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EXHIBIT 10.3
FIRST AMENDED AND RESTATED REGISTRATION RIGHTS AGREEMENT
THIS FIRST AMENDED AND RESTATED REGISTRATION RIGHTS AGREEMENT (this
"Agreement") is made and entered into this 24th day of February, 1997, by and
between AudioNet, Inc., a Delaware corporation (the "Company") and each of the
Investors listed on Schedule A hereto.
WHEREAS, the Company and Motorola, Inc, Premiere Radio Networks, Inc.,
HMTF AudioNet Investors and Capitol Radio Network, Inc. (collectively, the
"Initial Investors") are parties to the Registration Rights Agreement dated as
of September 4, 1996 (the "Initial Registration Rights Agreement");
WHEREAS, the Company and the Initial Investors desire to amend and
restate the Initial Registration Rights Agreement as hereinafter set forth and
the Company desires to grant to the Investors the registration rights contained
herein;
WHEREAS, in consideration of the promises, covenants and matters
hereinafter set forth, the parties hereto mutually covenant, contract and
agree, each with the other, as follows:
1. Certain Definitions. As used in this Agreement, the following
terms shall have the following respective meanings:
"Commission" shall mean the Securities and Exchange Commission or any
other federal agency at the time administering the Securities Act.
"Common Stock" shall mean the common stock of the Company, $0.01 par
value per share.
"Registrable Securities" shall mean (i) the shares of Common Stock of
the Company purchased by the Investors pursuant to the terms of purchase
agreements between the Company and such Investors (the "Investor PA's") and
(ii) any other shares of Common Stock or other securities of the Company which
such Investors acquire (other than shares acquired by such Investors in the
open market at any time following the Company's first registration under the
Securities Act and sale of the Common Stock (the "Initial Public Offering"));
provided, however, that shares of Common Stock of the Company which are
Registrable Securities shall cease to be Registrable Securities upon any sale
or transfer in any manner to any person or entity, including, but not limited
to, sales pursuant to a registration statement, Rule 144 sales or otherwise,
but excluding any sale or transfer in connection with which the rights of the
Investors hereunder are assignable pursuant to Section 9.
"Investor or Investors" shall mean the investors listed on Schedule A
hereto and their permitted successor and assigns pursuant to Section 9 hereof
who hold Registrable Securities, and any other holder of Common Stock of the
Company who by amendment has been granted registration rights under this
Agreement by the Company with the consent of Investors holding a majority of
the Registrable Securities.
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"Initiating Investors" shall mean holders of not less than a majority
of the Registrable Securities who make a request for registration pursuant to
Section 2(a) hereof.
The terms "register," "registered" and "registration" refer to a
registration effected by preparing and filing a registration statement in
compliance with the Securities Act, and the declaration or ordering of the
effectiveness of such registration statement.
"Registration Expenses" shall mean all expenses, other than Selling
Expenses (as defined below), incurred by the Company in complying with this
Agreement, including, without limitation, all registration, qualification and
filing fees, printing expenses, escrow fees, fees and disbursements of counsel
for the Company, fees and disbursements of counsel for the Investors (not in
excess of $10,000), blue sky fees and expenses and the expense of any special
audits incident to or required by any such registration.
"Securities Act" shall mean the Securities Act of 1933, as amended, or
any similar federal statute and the rules and regulations of the Commission
thereunder, all as the same shall be in effect at the time.
"Selling Expenses" shall mean all underwriting discounts, selling
commissions and stock transfer taxes applicable to the securities registered by
the Investors and, except as set forth above, all fees and disbursements of
counsel for the Investors.
2. Requested Registration.
(a) Request for Registration. In case the Company shall receive
from the Initiating Investors a written request that the Company effect any
registration, qualification or compliance:
(i) with respect to Registrable Securities that are
expected to have an aggregate offering value of Five Million Dollars
($5,000,000) or more and such request is any time at least six months after the
closing of the Initial Public Offering; or
(ii) with respect to Registrable Securities on a Form S-3
or any similar short form registration statement under the Securities Act;
the Company will, as soon as practicable, use its reasonable best efforts to
effect such registration, qualification or compliance (including, without
limitation, appropriate qualification under applicable blue sky or other state
securities laws and appropriate compliance with applicable regulations issued
under the Securities Act and any other governmental requirements or
regulations) as may be so requested and as would permit or facilitate the sale
and distribution of all or such portion of such Registrable Securities as are
specified in such request; provided, however, that the Company shall not be
obligated to take any action to effect any such registration, qualification or
compliance pursuant to this Section 2:
(A) In any particular jurisdiction in which the Company
would be required to execute a general consent to service of process in
effecting such registration, qualification or compliance unless the Company is
already subject to service in such jurisdiction and except as may be required
by the Securities Act, nor in any jurisdiction in which the Company would be
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required to subject itself to taxation by such act or to conform the
composition of its assets at the time to the securities or blue sky laws of any
jurisdiction;
(B) With respect to the registration right set forth in
clauses (i) and (ii) above, during the period starting with the date sixty (60)
days prior to the Company's estimated date of filing of, and ending on the date
six (6) months immediately following the effective date of, any registration
statement (or ending on the date three (3) months immediately following the
effective date, in the event the Company shall then be eligible to effect a
registration statement, for shares to be sold generally to the public, on Form
S-3 or any successor form) pertaining to securities of the Company (other than
a registration of securities in a Rule 145 transaction or with respect to an
employee benefit plan), provided that the Company is actively employing in good
faith all reasonable efforts to cause such registration statement to become
effective (and provided, further, that the Company cannot pursuant to this
Section 2(a)(B) delay implementation of a demand for registration more than
once in any 9-month period);
(C) After the Company has effected a total of (1) one
such registration under the Securities Act on Form S-3 or any similar short
form registration statement pursuant to Section 2(a)(ii), (2) one other
registration pursuant to Section 2(a)(i), and (3) in the event that the
Initiating Investors still hold at least 25% of the shares of Common Stock (as
adjusted) which such Investors acquired, directly or indirectly, pursuant to
the Investor PA's following the registrations described in Sections 2(a)(C)(1)
and (2), one other registration on Form S-3 or any similar short form
registration statement pursuant to Section 2(a)(ii), with it being understood
that (i) the number of registrations is subject to adjustment under Sections 2
and 5, and (ii) such registrations have been declared or ordered effective;
(D) If the Company shall furnish to the Initiating
Investors a certificate signed by the Chief Executive Officer of the Company
stating that in the good faith judgment of the Board of Directors it would be
seriously detrimental to the Company or its shareholders for a registration
statement to be filed in the near future, then the Company's obligation to use
its reasonable best efforts to register, qualify or comply under this Section
2(a) shall be deferred once (with respect to any demand for registration
hereunder) for a period not to exceed 180 days from the date of receipt of
written request from the Initiating Investors.
(E) If the Company shall furnish to the Initiating
Investors a certified statement from an underwriter or investment banker chosen
to manage the public offering that the timing is inappropriate for the filing
of a registration statement due to adverse market conditions or the terms of
the proposed offering or for other specified substantive reasons affecting the
marketability of the securities, then the Company's obligation under Section
2(a) shall be deferred once (with respect to any demand for registration
hereunder). The period of deferral hereunder shall not exceed 180 days from the
date of receipt of written request from the Initiating Investors.
(F) The Company shall not be obligated to effect a
registration, qualification or compliance if such registration, qualification
or compliance would result in a violation of the Securities Act.
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Subject to the foregoing clauses (A) through (F), the Company shall
give prompt written notice (the "Notice of Demand Request") of the Initiating
Investors' request to all Investors and, thereupon, the Company shall, as
expeditiously as possible, use its reasonable best efforts to effect the
registration under the Securities Act of (i) the Registrable Securities which
the Company has been so requested to register in the registration request, for
disposition in accordance with the intended method of disposition stated in the
registration statement and (ii) all other Registrable Securities the holders of
which shall have made a written request to the Company for registration thereof
within 30 days after the giving of the Notice of Demand Request, all to the
extent necessary to permit the sale or other disposition by the holders of the
securities to be registered. Whenever a requested registration is for a firmly
underwritten offering, if the managing underwriter for such offering determines
that the number of shares of Common Stock requested to be included that are to
be sold by Investors is limited due to market conditions, the Investors
(including both Investors who are and who are not Initiating Investors)
proposing to sell their Registrable Securities in such underwriting and
registration shall share pro rata in the available portion of the registration
statement in question, such sharing to be based upon the number of Registrable
Securities then held by such Investors, respectively. If any Investor
disapproves of the terms of the underwriting, such Investor may elect to
withdraw therefrom by written notice to the Company, the managing underwriter
and the Initiating Investors. The Registrable Securities so withdrawn shall
also be withdrawn from the registration; provided, however, that, if by such
withdrawal the Registrable Securities held by other Investors may be included
in such registration (up to the maximum of any limitation imposed by the
underwriter), then the Company shall offer to all Investors who have included
Registrable Securities in the registration the right to include additional
Registrable Securities in the same proportion used in determining the foregoing
limitation.
(b) Underwriting. In the event that a registration pursuant to
Section 2 is for a registered public offering involving an underwriting, the
Company and the Investors including Registrable Securities in such registration
shall enter into an underwriting agreement in customary form with the managing
underwriter selected for such underwriting by the Company, but subject to the
Initiating Investors' reasonable approval.
(c) Form of Registration. Notwithstanding anything to the
contrary herein, if at any time after the first anniversary of the Company's
Initial Public Offering the Company is not eligible to use a Form S-3 or any
similar short form registration statement because of the Company's failure to
file with the Commission in a timely manner all reports and other documents
required of the Company under the Securities Act and the Securities Exchange
Act of 1934, as amended, any references in this Agreement to registrations on
Form S-3 or any similar short form registration statement shall be deemed to be
references to registrations on Form S-l or any similar long form registration
statement which the Company is then eligible to use.
3. Company Registration.
(a) Notice of Registration. If at any time or from time to time
the Company shall determine to register any of its securities, either for its
own account or the account of a security holder or holders, other than (i) a
registration relating solely to employee benefit plans, (ii) a
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registration relating solely to a Commission Rule 145 transaction, or (iii) the
Initial Public Offering, the Company will:
(i) promptly give to the Investors written notice
thereof; and
(ii) include in such registration (and any related
qualification under blue sky laws or other compliance), and in any underwriting
involved therein, all the Registrable Securities specified in a written request
or requests, made within 15 days after receipt of such written notice from the
Company, by the Investors, provided, however, if any registration pursuant to
this Section 3 involves an underwritten offering and the managing underwriter
shall advise the Company that, in its view, the number of securities requested
to be included in such registration exceeds the number that can be sold in an
orderly manner in such offering within a price range acceptable to the Company,
the Company shall include in such offering (i) first, all the securities the
Company proposes to register for its own account, and (ii) second, the
Registrable Securities, with each Investor proposing to sell Registrable
Securities participating in such registration on a pro rata basis, such
participation to be based upon the number of Registrable Securities then held
by such Investors, respectively. If any Investor disapproves of the terms of
the underwriting, such Investor may elect to withdraw therefrom by written
notice to the Company and the managing underwriter. The Registrable Securities
so withdrawn shall also be withdrawn from the registration; provided, however,
that, if by such withdrawal, the Registrable Securities held by other Investors
may be included in such registration (up to the maximum of any limitation
imposed by the underwriter), then the Company shall offer to all Investors who
have included Registrable Securities in the registration the right to include
additional Registrable Securities in the same proportion used in determining
the foregoing limitation.
(b) Right to Terminate Registration. The Company shall have the
right to terminate or withdraw any registration initiated by it under this
Section 3 prior to the effectiveness of such registration whether or not the
Investors have elected to include Registrable Securities in such registration.
Each Investor who holds Registrable Securities included in the registration
agrees that, upon receipt of notice from the Company that the Company has
determined to withdraw any registration statement pursuant to this subsection,
such Investor will discontinue its disposition of securities pursuant to such
registration statement and, if so directed by the Company, will deliver to the
Company (at the Company's expense) all copies, other than permanent file
copies, then in such Investor's possession of the prospectus covering
securities which was in effect at the time of such notice.
4. Limitations on Subsequent Registration Rights. From and after
the Closing Date, the Company shall not enter into any agreement granting any
holder or prospective holder of any securities of the Company registration
rights with respect to such securities that would allow such holder or
prospective holder to (a) include such securities in any registration filed
under Section 2 hereof, unless under the terms of such agreement, such holder
or prospective holder may include such securities in any such registration only
to the extent that the inclusion of its securities will not reduce the amount
of the Registrable Securities of the Investors which is included, or (b) make a
requested registration which could result in such registration statement being
declared effective prior to the date set forth in Section 2(a)(i) or within 120
days of the effective date of any
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registration effected pursuant to Section 2, unless any such agreement is
consented to in writing by Investors holding a majority of the Registrable
Securities.
5. Expenses of Registration. All Registration Expenses incurred
in connection with all registrations shall be borne by the Company, except to
the extent that the Initiating Investors alone, but not the Company, initiates
the request that a registration be withdrawn prior to its effectiveness, and if
the Initiating Investors elect not to have such registration counted as a
registration requested under Section 2 in which case all Registration Expenses
incurred in connection with that registration shall be borne by the Initiating
Investors on a pro rata basis. All Selling Expenses relating to securities
registered on behalf of the Investors shall be borne by the Investors.
6. Registration Procedures. In the case of each registration,
qualification or compliance effected by the Company pursuant to this Agreement,
the Company will keep the Investors advised in writing as to the initiation of
each registration, qualification and compliance and as to the completion
thereof. The Company will:
(a) use its reasonable best efforts to effect the
registration and the sale of such Registrable Securities in accordance with the
intended method of disposition thereof and pursuant thereto the Company will as
expeditiously as possible;
(b) prepare and file with the Commission a registration
statement with respect to such Registrable Securities and use its reasonable
best efforts to cause such registration statement to become effective (provided
that before filing a registration statement or prospectus or any amendments or
supplements thereto, the Company will furnish to the counsel selected by the
Initiating Investors copies of all such documents proposed to be filed);
(c) prepare and file with the Commission such amendments
and supplements to such registration statement and the prospectus used in
connection therewith as may be necessary to keep such registration statement
effective for a period of not less than 120 days and comply with the provisions
of the Securities Act with respect to the disposition of all securities covered
by such registration statement during such period in accordance with the
intended methods of disposition by the sellers thereof set forth in such
registration statement;
(d) during the period in which the Company is required
under the provisions hereof to keep a registration statement effective, furnish
to the seller of Registrable Securities such number of copies of such
registration statement, each amendment and supplement thereto, the prospectus
included in such registration statement (including each preliminary prospectus)
and such other documents as such seller may reasonably request in order to
facilitate the disposition of the Registrable Securities owned by such seller;
(e) subject to Section 2(a)(A) - (F) herein, use its
reasonable best efforts to register or qualify such Registrable Securities
under such other securities or blue sky laws of such jurisdictions as any
seller reasonably requests and do any and all other acts and things which may
be reasonably necessary or advisable to enable such seller to consummate the
disposition in such jurisdictions of the Registrable Securities owned by such
seller (provided that the Company will
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not be required to (i) qualify generally to do business in any jurisdiction
where it would not otherwise be required to qualify but for this subparagraph,
(ii) subject itself to taxation in any such jurisdiction or (iii) consent to
general service of process in any such jurisdiction);
(f) notify the seller of such Registrable Securities, any
time the Company becomes aware a prospectus relating thereto is required to be
delivered under the Securities Act, of the happening of any event as a result
of which the prospectus included in such registration statement contains an
untrue statement of a material fact or omits any fact necessary to make the
statements therein not misleading, and, at the request of such seller, the
Company will prepare a supplement or amendment to such prospectus so that, as
thereafter delivered to the purchasers of such Registrable Securities, such
prospectus will not contain an untrue statement of a material fact or omit to
state any fact necessary to make the statements therein not misleading;
(g) use its reasonable best efforts to cause all such
Registrable Securities to be listed on each securities exchange on which
similar securities issued by the Company are then listed and, if not so listed,
to be listed on the NASD automated quotation system and, if listed on the NASD
automated quotation system, use its reasonable best efforts to secure
designation of all such Registrable Securities covered by such registration
statement as a Nasdaq "national market system security" within the meaning of
Rule 11Aa2-1 of the Commission or, failing that, use its best efforts to secure
Nasdaq authorization for such Registrable Securities;
(h) provide a transfer agent and registrar for all such
Registrable Securities not later than the effective date of such registration
statement;
(i) enter into such customary agreements (including
underwriting agreements in customary form, provided that such underwriting
agreement shall be reasonably satisfactory to the Company) and take all such
other actions as the holders of a majority of the Registrable Securities being
sold or the underwriters, if any, reasonably request in order to expedite or
facilitate the disposition of such Registrable Securities (including, without
limitation, (i) effecting a stock split or a combination of shares, (ii) not
effecting any public sale or distribution of its equity securities, or any
securities convertible into or exchangeable or exercisable for such securities,
during the seven days prior to and during the 180-day period beginning on the
effective date of any underwritten registration (except as part of such
underwritten registration or pursuant to registrations on Form S-8 or any
successor form), unless the underwriters managing the registered public
offering otherwise agree, and (iii) causing Xxxx Xxxxx, Xxxx X. Xxxxxx, and
using its reasonable efforts to cause each other holder of its Common Stock, or
any securities convertible into or exchangeable or exercisable for Common
Stock, purchased from the Company at any time after the date of this Agreement
(other than in a registered public offering) to agree not to effect any public
sale or distribution (including sales pursuant to Rule 144) of any such
securities during such period (except as part of such underwritten
registration, if otherwise permitted), unless the underwriters managing the
registered public offering otherwise agree);
(j) upon receipt and execution of such confidentiality
agreements as the Company may reasonably request from parties who are not
otherwise subject to confidentiality obligations because of the nature of their
profession (e.g., underwriters, attorneys and accountants), make available for
inspection by the seller of Registrable Securities, any underwriter
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participating in any disposition pursuant to such registration statement and
any attorney, accountant or other agent retained by any such seller or
underwriter, all financial and other records, pertinent corporate documents and
properties of the Company, and cause the Company's officers, directors,
employees and independent accountants to supply all information reasonably
requested by any such seller, underwriter, attorney, accountant or agent in
connection with such registration statement;
(k) otherwise use its reasonable best efforts to comply
with all applicable rules and regulations of the Commission, and make available
to its security holders, as soon as reasonably practicable, an earnings
statement covering the period of at least 12 months beginning with the first
day of the Company's first full calendar quarter after the effective date of
the registration statement, which earnings statement shall satisfy the
provisions of Section 11(a) of the Securities Act and Rule 158 thereunder;
(l) if any such registration or comparable statement
refers to any holder by name or otherwise as the holder of any securities of
the Company and if its sole and exclusive judgment, such holder is or might be
deemed to be a controlling person of the Company, such holder shall have the
right to require (i) the insertion therein of language, in form and substance
satisfactory to such holder and presented to the Company in writing, to the
effect that the holding by such holder of such securities is not to be
construed as a recommendation by such holder of the investment quality of the
Company's securities covered thereby and that such holding does not imply that
such holder will assist in meeting any future financial requirements of the
Company, or (ii) in the event that such reference to such holder by name or
otherwise is not required by the Securities Act or any similar federal statute
then in force, the deletion of the reference to such holder; provided that with
respect to this clause (ii) such holder shall furnish to the Company an opinion
of counsel to such effect, which opinion and counsel shall be reasonably
satisfactory to the Company; and
(m) in the event of the issuance of any stop order
suspending the effectiveness of a registration statement, or of any order
suspending or preventing the use of any related prospectus or suspending the
qualification of any common stock included in such registration statement for
sale in any jurisdiction, the Company will use its reasonable best efforts
promptly to obtain the withdrawal of such order.
7. Indemnification.
(a) The Company agrees to indemnify, to the extent permitted by
law, each holder of Registrable Securities, its officers and directors and each
person who controls such holder (within the meaning of the Securities Act)
against all losses, claims, damages, liabilities and expenses caused by any
untrue or alleged untrue statement of material fact contained in any
registration statement, prospectus or preliminary prospectus or any amendment
thereof or supplement thereto or any omission or alleged omission of a material
fact required to be stated therein or necessary to make the statements therein
not misleading, except insofar as the same are caused by or contained in any
affidavits or written information supplied or withheld from the Company
relating to such holder's ownership of Registrable Securities or as otherwise
required under the Securities Act furnished by such holder expressly for use in
such registration statement or by such holder's failure
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to deliver a copy of the registration statement or prospectus or any amendments
or supplements thereto after the Company has furnished such holder with the
number of copies of the same reasonably requested by such holder.
(b) In connection with any registration statement in which a
holder of Registrable Securities is participating, each such holder will
furnish to the Company in writing such information and affidavits relating to
such holder's ownership of Registrable Securities or as otherwise required
under the Securities Act as the Company reasonably requests for use in
connection with any such registration statement or prospectus and, to the
extent permitted by law, will indemnify the Company, its directors and officers
and each person who controls the Company (within the meaning of the Securities
Act) against any losses, claims, damages, liabilities and expenses resulting
from any untrue or alleged untrue statement of material fact contained in the
registration statement, prospectus or preliminary prospectus or any amendment
thereof or supplement thereto or any omission or alleged omission of a material
fact required to be stated therein or necessary to make the statements therein
not misleading, but only to the extent that such untrue statement or omission
is contained in any information or affidavit so furnished in writing by such
holder which was expressly provided for use in such registration statement and
was included in such registration statement in reliance on and in conformity
with such written information or affidavit.
(c) Any person entitled to indemnification hereunder will (i) give
prompt written notice to the indemnifying party of any claim with respect to
which it seeks indemnification and (ii) unless in such indemnified party's
reasonable judgment a conflict of interest between such indemnified and
indemnifying parties may exist with respect to such claim, permit such
indemnifying party to assume the defense of such claim with counsel reasonably
satisfactory to the indemnified party. If such defense is assumed or not
defended because of a conflict of interest pursuant to clause (ii) of the
preceding sentence, the indemnifying party will not be subject to any liability
for any settlement made by the indemnified party without its consent (but such
consent will not be unreasonably withheld). An indemnifying party who is not
entitled to, or elects not to, assume the defense of a claim will not be
obligated to pay the fees and expenses of more than one counsel for all parties
indemnified by such indemnifying party with respect to such claim, unless in
the reasonable judgment of any indemnified party a conflict of interest may
exist between such indemnified party and any other of such indemnified parties
with respect to such claim.
(d) The indemnification provided for under this Agreement will
remain in full force and effect regardless of any investigation made by or on
behalf of the indemnified party or any officer, director or controlling person
of such indemnified party and will survive the transfer of securities. The
Company also agrees to make such provisions, as are reasonably requested by any
indemnified party, for contribution to such party in the event the Company's
indemnification is unavailable for any reason.
8. Rule 144 Reporting. With a view to making available the
benefits of certain rules and regulations of the Commission which may at any
time permit the sale of the Restricted Securities to the public without
registration, after such time as a public market exists for the Common Stock of
the Company, the Company agrees to use its reasonable best efforts to:
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(a) Make and keep public information available, as those
terms are understood and defined in Rule 144 under the Securities Act, at all
times after the effective date that the Company becomes subject to the
reporting requirements of the Securities Act or the Securities Exchange Act of
1934, as amended.
(b) File with the Commission in a timely manner all
reports and other documents required of the Company under the Securities Act
and the Securities Exchange Act of 1934, as amended (at any time after it has
become subject to such reporting requirements).
(c) So long as any Investor owns any Registrable
Securities to furnish to such Investor forthwith upon request a written
statement by the Company as to its compliance with the reporting requirements
of Rule 144 (at any time after 90 days after the effective date of the first
registration statement filed by the Company for an offering of its securities
to the general public) and of the Securities Act and the Securities Exchange
Act of 1934 (at any time after it has become subject to such reporting
requirements) a copy of the most recent annual or quarterly report of the
Company, and such other reports and documents of the Company and other
information in the possession of or reasonably obtainable by the Company as
such Investor may reasonably request in availing itself of any rule or
regulation of the Commission allowing such Investor to sell any such securities
without registration.
9. Transfer of Registration Rights. The rights granted to the
Investors hereunder may be assigned to a transferee or assignee in connection
with any transfer or assignment of Registrable Securities by an Investor
provided that: (i) such transfer may otherwise be effected in accordance with
applicable securities laws, (ii) such Investor notifies the Company in writing
of the transfer or assignment and the assignee or transferee agrees in writing
to be bound by the provisions of this Agreement, and (iii) not less than 25% of
the transferring Investor's Registrable Securities are transferred.
10. Termination of Registration Rights. The Company's obligations
pursuant to Sections 2, 3 and 4 shall expire when all Registrable Securities
held by the Investors or any assignee have been sold or transferred in any
manner to any person or entity, including, but not limited to, sales pursuant
to a registration statement, Rule 144 sales or otherwise, but excluding any
sale or transfer in connection with which the rights of the Investor hereunder
are assigned pursuant to Section 9.
11. Stand-Off Agreement. So long as the Company's obligations
pursuant to Sections 2, 3 and 4 have not expired, each Investor, if requested
by the Company and an underwriter of Common Stock or other securities of the
Company, shall agree not to sell or otherwise transfer or dispose of any
Registrable Securities or other securities of the Company (except as otherwise
permitted by agreements) held by such Investor for a specified period of time
(not to exceed 180 days) following the effective date of a registration
statement; provided, that such agreement shall only apply to the first such
registration statement covering Common Stock of the Company to be sold on its
behalf to the public in an underwritten offering; and that such agreement shall
be in a form satisfactory to the Company and such underwriter. The Company may
impose stop-transfer instructions with respect to the Registrable Securities or
other securities subject to the foregoing restriction until the end of the
stand-off period.
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12. Confidentiality. Each Investor (other than parties which are
bound by a mutual non-disclosure agreement with the Company) hereby agrees that
it shall maintain in confidence, and shall not use or disclose without the
prior written consent of the Company, any information identified as
confidential that is furnished to it by the Company in connection with this
Agreement, including (without limitation) all financial statements, budget and
other information delivered or provided to such Investor. This obligation of
confidentiality shall not apply, however, to any information (a) in the public
domain through no unauthorized act or failure to act by such Investor, (b)
lawfully disclosed to such Investor by a third party who possessed such
information without any obligation of confidentiality, or (c) known previously
by such Investor or lawfully developed by such Investor independent of any
disclosure by the Company. Each Investor further agrees that it shall return to
the Company all tangible materials containing such information upon request by
the Company.
13. Miscellaneous.
13.1 Governing Law. This Agreement shall be governed in all
respects by the internal laws of the State of New York.
13.2 Survival. The representations, warranties, covenants and
agreements made herein shall survive any investigation made by the Investors
and the closing of the transactions contemplated hereby.
13.3 Successors and Assigns. The provisions hereof shall inure to
the benefit of, and be binding upon, the successors, permitted assigns, heirs,
executors and administrators of the parties hereto, including as specifically
provided by Section 9 hereof.
13.4 Entire Agreement; Amendment. This Agreement, its attachments
and the other documents delivered pursuant hereto at the Closing constitute the
full and entire understanding and agreement between the parties with regard to
the subjects hereof and thereof. Except as expressly provided herein, neither
this Agreement nor any term hereof may be amended, waived, discharged or
terminated other than by a written instrument signed by the Company and
Investors holding at least 67% of the Registrable Securities.
13.5 Counterparts. This Agreement may be executed in any number of
counterparts, each of which shall be enforceable against the parties actually
executing such counterparts, and all of which together shall constitute one
instrument.
13.6 Severability. In the event that any provision of this
Agreement becomes or is declared by a court of competent jurisdiction to be
illegal, unenforceable or void, this Agreement shall continue in full force and
effect without said provision; provided that no such severability shall be
effective if it materially changes the economic benefit of this Agreement to
any party.
13.7 Titles and Subtitles. The titles and subtitles used in this
Agreement are used for convenience only and are not considered in construing or
interpreting this Agreement.
13.8 Adjustments Affecting Registrable Securities. The Company
will not take any action, or permit any change, with respect to the terms of
its securities which would materially and adversely affect the ability of the
Investors to include such Registrable Securities in a registration undertaken
pursuant to this Agreement or which would materially and adversely affect the
marketability of said Registrable Securities in any such registration
(including, without limitation, effecting a stock split or combination of
shares).
11
12
IN WITNESS WHEREOF, the parties below have executed this Agreement all
as of the date first written above.
AUDIONET, INC.
By: XXXX XXXXXX
----------------------------
Title: CEO
-------------------------
MOTOROLA, INC.
By: XXXXXX X. XXXXX
----------------------------
Title: DIRECTOR & GM, INTERNET
CONTENT & SERVICE
BUSINESS
-------------------------
PREMIERE RADIO NETWORKS, INC.
By: XXXXXX XXXXXX
----------------------------
Title: PRESIDENT & CEO
-------------------------
HMTF AUDIONET INVESTORS
By: XXXXXXX XXXXX
----------------------------
Title: GENERAL PARTNER
-------------------------
CAPITOL RADIO NETWORK, INC.
By: XXXX X. XXXXXXX
----------------------------
Title: VICE PRESIDENT
-------------------------
INTEL CORPORATION
By: XXXXXX XXXXXXX
----------------------------
Title: VICE PRESIDENT &
TREASURER
-------------------------
12
13
SCHEDULE A
SCHEDULE OF INVESTORS
Motorola, Inc.
Premiere Radio Networks, Inc.
HMTF AudioNet Investors
Capitol Radio Network, Inc.
Intel Corporation
A-1
14
ADDENDUM TO FIRST AMENDED AND RESTATED
REGISTRATION RIGHTS AGREEMENT
This Addendum (the "Addendum") to the First Amended and Restated
Registration Rights Agreement (attached hereto as Exhibit A) (the "Registration
Rights Agreement") is made and entered into as of the 30th day of December 1997
by and among AudioNet Inc. (the "Company"), Intel Corporation ("Intel"),
Motorola, Inc. ("Motorola") and Yahoo! Inc. ("Yahoo").
Capitalized terms used herein and not otherwise defined shall have the
meanings given to them in the Registration Rights Agreement.
WHEREAS, pursuant to the terms of a Stock and Warrant Purchase Agreement,
dated as of the date hereof, between the Company and Yahoo (the "Stock Purchase
Agreement") Yahoo desires to purchase 79,618 shares of common stock of the
Company and a warrant to purchase additional shares of common stock of the
Company (the "Warrant").
WHEREAS, a condition to Yahoo's obligation to purchase the shares of
common stock and the Warrant pursuant to the Stock Purchase Agreement is that
Yahoo shall be entitled to all of the rights and bound by all of the
obligations of an "Investor" under the Registration Rights Agreement.
WHEREAS, the Company, in order to induce Yahoo to enter into the Stock
Purchase Agreement, desires to grant rights to Yahoo as an Investor under the
Registration Rights Agreement.
NOW, THEREFORE in consideration of the agreements set forth herein, the
parties hereto agree as follows:
1. Upon execution of this Addendum, Yahoo shall be entitled to all of the
rights of an Investor under the Registration Rights Agreement, subject to and
bound by all of the terms, conditions, and covenants contained within the
Registration Rights Agreement effective as of the date hereof.
2. Each of the Company, Motorola, Inc. and Intel Corporation hereby
acknowledges that Yahoo is an Investor for purposes of the Registration Rights
Agreement effective as of the date hereof.
15
IN WITNESS WHEREOF, the parties hereto have executed this Addendum to
First Amended and Restated Registration Rights Agreement effective as of the
date first written above.
AudioNet, Inc.
By: /s/ XXXX XXXXXX
-----------------------------------------
Name: Xxxx Xxxxxx
Title: CEO
Yahoo! Inc.
By: /s/ X. X. XXXXXX
-----------------------------------------
Name: Xxx Xxxxxx
Title: President & CEO
Consented and agreed to pursuant to Section 1
of the First Amended and Restated
Registration Rights Agreement, dated as of
February 24, 1997, by and between AudioNet,
Inc. and each of the Investors listed on
Schedule A thereto.
Motorola, Inc.
By: /s/ XXXXXX X. XXXXXX
-----------------------------------------
Name: Xxxxxx X. Xxxxxx
Title: Vice President and General Manager
Motorola New Enterprises
Intel Corporation
----------- By: /s/ XXXXXX XXXXX
LEGAL OK -----------------------------------------
----------- Name: Xxxxxx Xxxxx
[ILLEGIBLE] Title: Assistant Treasurer
-----------
2
