1
EXHIBIT 10.4
AMENDED AND RESTATED VESTING AGREEMENT
This Amended and Restated Vesting Agreement (the "Agreement") is
dated as of October 24, 1997, between INTERVU INC., a Delaware corporation (the
"Corporation" or the "Company"), and Harry E. Gruber (an "Initial
Stockholder").
The Initial Stockholder owns shares of Common Stock, $.001 par
value, of the Corporation (the "Common Stock"). This Agreement is an amendment
and restatement of one of the Vesting Agreements executed and delivered by the
Corporation and each of the initial stockholders of the Corporation (the
"Initial Stockholders") as of March 4, 1996 (the "Vesting Agreements").
The Initial Stockholder is a party to the Voting Trust Agreement
dated as of August 28, 1995 (the "Voting Trust") among Harry Gruber, as Trustee
(the "Trustee"), the Corporation, and each of the Initial Stockholders.
NOW, THEREFORE, for good and valuable consideration, the receipt
of which is hereby acknowledged, the parties hereto hereby agree as follows:
1. Definitions. As used herein, the following terms shall have
the following respective meanings:
(a) "Disability" shall, with respect to the Initial
Stockholder, mean the written certification by an independent medical doctor
(selected by the Corporation) that the Initial Stockholder has, for 180 days,
consecutive or non-consecutive, in any twelve (12) month period, been disabled
in a manner which renders the Initial Stockholder incapable of contributing any
time or effort on behalf of the Corporation.
(b) "Group" shall mean (i) the Initial Stockholder; (ii)
the spouse, parents, siblings and lineal descendants of the Initial
Stockholder; (iii) a trust for the benefit of any of the foregoing; (iv) any
distributee, legatee or devisee of the Initial Stockholder or anyone described
in the preceding clause (ii); and (v) an entity in which the persons described
in clauses (i) through (iv) own at least 90 percent of the voting and economic
interests; in each case who agrees in writing with the Corporation to be bound
by and to comply with this Agreement to the same extent as the Initial
Stockholder.
(c) "Repurchase Event" shall, with respect to the Initial
Stockholder, mean (i) the death of the Initial Stockholder, (ii) the Disability
of the Initial Stockholder, or (iii) the date upon which the Initial
Stockholder shall no longer be willing to voluntarily contribute any time or
effort on behalf of the Corporation if the Corporation shall reasonably request
such time or effort upon prior reasonable notice, it being understood that, at
a minimum, the Initial Stockholder shall agree to serve as a member of the
Board of Directors of the Corporation if nominated; provided, that the Initial
Stockholder shall have thirty (30) days to cure any failure to contribute such
Initial Stockholder's time or effort pursuant to the immediately preceding
clause (iii).
(d) "Restricted Stock" shall mean 934,250 shares of
Common Stock, which number reflects stock splits affected through the date
hereof.
1
2
(e) "Sell" shall, as to any Securities (as hereinafter
defined) mean to sell, or in any other way directly or indirectly transfer,
assign, distribute, encumber, pledge, hypothecate or otherwise dispose of such
Securities, either voluntarily or involuntarily; provided, however, that the
Initial Stockholder and any member of the Group of the Initial Stockholder shall
not be deemed to Sell the Securities if such securities are transferred to a
member of the Group of the Initial Stockholder and such person agrees with the
Corporation and the Trustee in writing to be bound by the terms of this
Agreement and the Voting Trust to the same extent as the Initial Stockholder;
and provided, further, that the Initial Stockholder shall not Sell any
Securities which constitute Restricted Stock so long as the Voting Trust shall
remain in effect.
(f) "Securities" shall mean (i) the Restricted Stock, (ii)
any other shares of Common Stock issued to the Initial Stockholder prior to the
date hereof (the "Other Shares"), (iii) any other shares of Common Stock
acquired by the Initial Stockholder in respect of the Restricted Stock or the
Other Shares in connection with a stock dividend, distribution or
recapitalization for which no consideration was paid by the Initial Stockholder,
(iii) the Voting Trust Certificate held by the Initial Stockholder on the date
hereof, and (iv) any other Voting Trust Certificate acquired by the Initial
Stockholder in respect of the Voting Trust Certificate held by the Initial
Stockholder on the date hereof in connection with a stock dividend, distribution
or recapitalization for which no consideration was paid by the Initial
Stockholder.
(g) "Selling Group" shall mean the Group of the Initial
Stockholder proposing to Sell any of the Securities, or which has delivered a
notice of intention to Sell, pursuant to Section 3 hereof.
(h) "Voting Trust Certificate" shall mean any voting trust
certificate issued to the Initial Stockholder pursuant to the Voting Trust.
2. Repurchase of Restricted Stock.
(a) On and after the occurrence of a Repurchase Event,
the Corporation shall have the right to purchase from the Initial Stockholder
and any member of the Group of the Initial Stockholder, and the Initial
Stockholder and any member of the Group of the Initial Stockholder shall sell
to the Corporation upon the exercise of such right, at a purchase price per
share of $.005, up to the number of shares of Restricted Stock less the number
of Vested Shares (as hereinafter defined). As used herein:
(i) "Vested Shares" shall mean and be equal to
the product of (A) the number of shares of Restricted Stock and (B) the ratio
of Elapsed Days (as hereinafter defined) to Total Days (as hereinafter
defined).
(ii) "Elapsed Days" shall mean the number of
calendar days which have elapsed from March 4, 1996 until the date of a
Repurchase Event.
(iii) "Total Days" shall mean and be equal to
1,826.
The number of shares of Restricted Stock subject to repurchase at the time of
any stock dividend or other distribution made on or in respect of the
Restricted Stock or any subdivision, combination, redemption or
reclassification of the outstanding capital stock of the Corporation or
received in exchange for the
2
3
Restricted Stock or any part thereof, shall be adjusted to give effect to such
stock dividend, other distribution, subdivision, combination, redemption or
reclassification.
(b) In order to exercise the option to purchase
Restricted Stock under this Section 2, the Corporation shall deliver a written
notice to the Initial Stockholder within 20 days after the Repurchase Event
indicating its election to purchase such Restricted Stock and specifying the
number of shares of Restricted Stock which it elects to purchase and the
purchase price therefore. The repurchase of the Restricted Stock hereunder
shall be made on a date within 60 days of the Repurchase Event, by delivery of
a check payable to the order of the Initial Stockholder, against receipt of one
or more certificates, properly endorsed, evidencing the shares of the
Restricted Stock to be so repurchased.
(c) Notwithstanding the provisions of this Section 2, if
the Corporation is legally prohibited from or legally unable to repurchase the
Restricted Stock during the 60-day period referred to above, such 60-day period
shall be suspended until such date on which the Corporation is legally
permitted or legally able to repurchase the Restricted Stock, whereupon the
Corporation shall have the right to exercise its repurchase option within 60
days after such legal prohibition or inability no longer exists.
3. Procedures on Sale of Securities to Third Parties. Except as
otherwise expressly provided herein, the Initial Stockholder hereby agrees, and
each member of the Group to which the Initial Stockholder belongs shall be
deemed to agree, that he or it shall not Sell any Securities except in
accordance with the following procedures:
(a) If the Selling Group shall desire to sell Vested
Shares, Other Shares or Voting Trust Certificates, the Selling Group shall
first deliver to the Corporation a written notice, which shall be irrevocable
for a period of 30 days after delivery thereof, offering (the "Offer") all of
the Vested Shares, Other Shares or Voting Trust Certificates owned by the
Selling Group which the Selling Group desires to Sell (the "Offered
Securities") to a third party at the purchase price and on the terms specified
in the offer to Sell to such third party, whereupon the Corporation (or its
designee) shall have the right and option to purchase any or all of the Offered
Securities so offered at the purchase price and on the terms stated in the
Offer (such acceptance by the Corporation to be made by the delivery of a
written notice to the Selling Group within the 30-day period after delivery of
the aforesaid notice of intention to Sell).
(b) Sales of Offered Securities under the terms of
Section 3(a) hereof shall be made at the offices of the Corporation on a
mutually satisfactory business day within 15 days after the expiration of the
aforesaid periods. Delivery of certificates or other instruments evidencing
such Offered Securities, duly endorsed for transfer shall be made on such date
against payment of the purchase price therefore by certified or bank checks
drawn or by wire transfer.
(c) If effective acceptance shall not be received
pursuant to Section 3(a) hereof with respect to the Offered Securities, then
the Selling Group may Sell all or any part of the remaining Offered Securities
so offered for sale at price not less than the price, and on terms not more
favorable to the purchaser thereof than the terms, stated in the Offer, at any
time within 120 days after the expiration of the Offer made pursuant to Section
3(a) hereof. In the event the remaining shares of such Offered Securities are
not sold by the Selling Group during such 120-day period, the right of the
3
4
Selling Group to sell such remaining Securities shall expire and the
obligations of this Section 3 shall be reinstated; provided, however, that in
the event the Selling Group determines, at any time during such 120-day period,
that the sale of all or any part of the remaining Offered Securities so offered
on the terms set forth in the offer is impractical, the Selling Group can
terminate the offer and reinstate the procedure provided in this Section 3
without waiting for the expiration of such 120-day period.
(d) The Selling Group may specify in an Offer pursuant to
Section 3(a) hereof with respect to Securities that are Restricted Stock that
all shares mentioned therein must be sold, in which case acceptance received
pursuant to Section 3(a) hereof shall be deemed conditioned upon (i) receipt of
a written notice of acceptance with respect to all Securities mentioned in such
Offer and/or (ii) the sale of the remaining such Securities, if any, pursuant
to Section 3(c) hereof.
(e) Anything contained herein to the contrary
notwithstanding: (i) the Initial Stockholder shall not sell any Restricted
Stock and Other Shares so long as the Voting Trust shall remain in effect; (ii)
an offer pertaining to a Voting Trust Certificate owned by the Selling Group
pursuant to Section 3(a) hereof must be with respect to the entire Voting Trust
Certificate, and not less than the entire Voting Trust Certificate; and (iii)
any purchaser of Offered Securities shall agree in writing in advance of any
purchase of Offered Securities hereunder that it, she or he, as the case may
be, shall be bound by and comply with the terms and provisions of this Section
3 and the Voting Trust as if such purchaser were the "Initial Stockholder"
hereunder, and the Offered Securities so purchased shall continue to be subject
to repurchase as herein provided in this Section 3 and the Voting Trust.
4. Legends. All certificates representing Securities issued to
the Initial Stockholder shall have affixed thereto a legend substantially in
the following form:
"THE SECURITIES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN
REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED. THE
SECURITIES HAVE BEEN ACQUIRED FOR INVESTMENT AND MAY NOT BE PLEDGED,
HYPOTHECATED, SOLD OR TRANSFERRED IN THE ABSENCE OF AN EFFECTIVE
REGISTRATION STATEMENT FOR THE SECURITIES UNDER SUCH ACT OR AN OPINION
OF COUNSEL TO ISSUER THAT REGISTRATION IS NOT REQUIRED UNDER THE ACT.
ADDITIONALLY, THE TRANSFER OF THE SECURITIES REPRESENTED BY THIS
CERTIFICATE ARE RESTRICTED PURSUANT TO THE PROVISIONS SPECIFIED IN THE
AMENDED AND RESTATED VESTING AGREEMENT DATED AS OF OCTOBER 24, 1997
BETWEEN INTERVU INC. AND HARRY E. GRUBER, AND NO TRANSFER OF THESE
SECURITIES SHALL BE VALID OR EFFECTIVE UNTIL SUCH CONDITIONS HAVE BEEN
FULFILLED. COPIES OF SUCH AGREEMENT MAY BE OBTAINED AT NO COST BY
WRITTEN REQUEST MADE BY THE HOLDER OF RECORD OF THIS CERTIFICATE TO THE
SECRETARY OF INTERVU INC."
5. Modification of Restrictions. In connection with any
subsequent debt or equity financings of the Corporation, the Initial
Stockholder shall be bound by such restrictions with respect to the Securities
(including, without limitation, lock-up provisions in connection with any
public offering of securities by the Company registered under the Securities
Act of 1933, as amended, such
4
5
modifications to the provisions contained in this Agreement as shall be made
pursuant to this Section 5, or any other restrictions determined pursuant to
this Section 5), as shall be determined by: (i) Harry Gruber in his sole
discretion, except as otherwise provided in the immediately following clause
(ii); or (ii) in the event of the death, Disability or mental incapacity of
Harry Gruber, by the Initial Stockholders holding a majority in interest of all
Securities owned by the Initial Stockholders who are parties to the Vesting
Agreements; provided, however, that Other Shares and shares of Restricted Stock
which have become Vested Shares hereunder shall not be subject to forfeiture,
or to a call right (it being understood and agreed that a right of first offer
or a right of first refusal shall not be considered a call right for purposes
of this Agreement) in favor of the Corporation, pursuant to any restrictions
that are determined in accordance with this Section 5.
6. Voting Trust Agreement.
(a) Each of the parties hereto hereby agrees that Section
17 of the Voting Trust is hereby amended to read in its entirety as follows:
"17. Vesting Agreements. (a) The parties hereto
acknowledge and agree that certain of the shares of Common
Stock of the Company deposited with the Trustee hereunder by
each Shareholder are subject to the Amended and Restated
Vesting Agreement dated as of October 24, 1997 of such
Shareholder with the Company. The Trustee agrees to comply
with Section 2 of the Vesting Agreement of each Shareholder
with respect to the repurchase of a Shareholder's Common
Stock, as if the Trustee were the Shareholder party to such
Vesting Agreement. Anything contained herein to the contrary
notwithstanding, if any shares of Common Stock of a
Shareholder held by the Trustee hereunder are purchased by the
Company pursuant to Section 2 of the Vesting Agreement of such
Shareholder, the Trustee shall distribute the proceeds
received in respect of such shares to the Shareholder, and the
Shareholder shall deliver its voting trust certificate to the
Trustee, and the Trustee shall cancel such certificate and
issue a new voting trust certificate for the remaining shares
of Common Stock held in trust for such Shareholder.
(b) Each of the parties hereto agrees that a
Vesting Agreement (or any successor agreement or agreements
thereto entered into pursuant to Section 5 of a Vesting
Agreement) between the Company and a Shareholder shall only be
amended, changed or modified by a written agreement between
the Company and such Shareholder; provided, that any amendment
to a Vesting Agreement (or any successor agreement or
agreements thereto entered into pursuant to Section 5 of a
Vesting Agreement) which would amend, change or modify any
provision relating to the vesting, sale, transfer, or other
disposition of the securities purchased thereunder or subject
thereto (including, without limitation, Section 2 or 3 of a
Vesting Agreement) shall require: (i) the written consent of
Harry Gruber, in his sole discretion except as otherwise
provided in the immediately following clause (ii); (ii) in the
event of the death, Disability (as defined in the Vesting
Agreement of Harry Gruber) or mental incapacity of Harry
Gruber, the written consent of the Shareholders (including,
without limitation, the Shareholder whose Vesting Agreement,
or successor agreement or agreements thereto entered into
pursuant to Section 5 of such Vesting Agreement, is to be
amended, changed or modified)."
5
6
(b) All references in the Voting Trust to the "Stock
Purchase Agreement" of the Initial Stockholder are hereby amended to be
references to this Agreement.
(c) Section 2(a) of the Voting Trust is hereby amended in
its entirety to read as follows:
"2. Transfer of Shares to Trustee. (a) Each Shareholder,
upon execution of this Agreement, hereby assigns and transfers
to the Trustee and deposits with the Trustee all the
certificates for such Shareholder's share of Common Stock, as
set forth opposite such Shareholder's signature to this
Agreement, and such additional shares of Common Stock as may
be set forth in any additional document or instrument in which
a Shareholder agrees to make such additional shares of Common
Stock subject to this Agreement (all of such shares being
hereinafter collectively referred to as the "Shares") for the
purpose of vesting in the Trustee, as Trustee of an active
trust, the right to vote and act and to exercise other rights
pertaining to such shares, as and to the extent and upon the
terms and conditions and for the period set forth in this
Agreement. No shares shall be deposited hereunder except
shares having general voting powers, as provided in the
Certificate of Incorporation of the Company. All such share
certificates shall be endorsed, or accompanied by such
instruments of transfer, as to enable the Trustee to cause
such certificates to be transferred into the name of the
Trustee, as hereinafter provided. On receipt by the Trustee
of the certificates for any such shares and the transfer of
the same into the name of the Trustee, the Trustee shall issue
and deliver to each Shareholder voting trust certificates for
the shares so deposited. Shares so deposited with the Trustee
will be held by the Company at its principal office in
safekeeping for the Trustee."
(d) Anything contained herein to the contrary
notwithstanding, the parties hereto hereby acknowledge and agree that: (a) the
Restricted Stock held by the Initial Stockholder hereunder has been deposited
with the Trustee pursuant to the terms and provisions of the Voting Trust; (b)
the Initial Stockholder and Corporation shall be bound by, and shall comply
with, all terms of the Voting Trust; (c) the Trustee shall be authorized to
comply with the provisions of Section 2 of this Agreement; and (d) this
Agreement is subject to the Voting Trust, and in the event of any conflict
between this Agreement and the Voting Trust, the Voting Trust shall control.
7. Effects of Completion of Qualifying IPO. Notwithstanding any
provision contained herein, in that certain Restricted Stock Purchase Agreement
dated as of March 5, 1997 between the Corporation and the Initial Stockholder
or elsewhere, upon the successful completion of an initial public offering of
the Company's securities registered under the Securities Act of 1933, as
amended (the "Act"), which results in gross proceeds to the Company (before
deduction of underwriting discounts or commissions) of at least $7,500,000 (a
"Qualifying IPO"), Sections 3 and 5 hereof shall terminate automatically and
have no further force or effect. In addition, upon completion of a Qualifying
IPO, clauses (i) and (ii) of Section 1(c) hereof shall be deemed to be deleted
and shall have no further force or effect. In the event of the occurrence,
following a Qualifying IPO, of a merger or acquisition in which the Corporation
is not the surviving entity, the sale, transfer or other disposition of all or
substantially all of the assets of the Corporation or any reverse merger in
which the Corporation is the surviving entity but in which fifty percent (50%)
or more of the Company's outstanding voting stock is transferred to holders
different from those who held the stock immediately
6
7
prior to such merger, Section 2 hereof shall terminate, with all shares of
Restricted Stock immediately fully vesting and being no longer subject to
repurchase by the Company. Initial Stockholder further agrees, subject to
successful completion of a Qualifying IPO, that in connection with a subsequent
underwritten public offering of Common Stock or other securities of the Company
to be registered on a registration statement filed under the Act, he will enter
into an agreement (to the extent requested by the Company and the Company's
underwriter) to the effect that he will not sell or otherwise transfer or
dispose of shares of Common Stock or other securities of the Company during the
period specified by the Company and such underwriter; provided however that (i)
such period shall not exceed 90 days; (ii) all of the directors and executive
officers of the Company and all of the Initial Stockholders enter into similar
agreements; and (iii) the covenant set forth in this sentence shall only remain
in effect for the three-year period immediately following the closing date of a
Qualifying IPO and shall thereafter terminate and have no force or effect.
8. Notices. All notices or other communications which are
required or permitted hereunder shall be deemed to be sufficient if contained
in a written instrument given by personal delivery, telex, facsimile (with a
confirmation copy sent by first class certified or registered United States
mail), telegram, air courier, or first class certified or registered United
States mail, postage prepaid, return receipt requested, addressed to such party
at the address set forth below or such other address as may thereafter be
designated in writing by the addressee to the addressor listing all parties:
if to Corporation, to:
InterVU Inc.
201 Lomas Santa Fe Drive
Solana Beach, California 92075
Attention: President
if to Initial Stockholder, to:
Harry E. Gruber
InterVU Inc.
201 Lomas Santa Fe Drive
Solana Beach, CA 92075
All such notices, advices and communications shall be deemed to have been
delivered and received (a) in the case of personal delivery, telex, facsimile
(with a confirmation copy sent by first class certified or registered United
States mail) or telegram on the date of such delivery, (b) in the case of air
courier on the business day after the date when sent, and (c) in the case of
mailing, on the third business day following the date of such mailing.
9. Governing Law. This Agreement shall be governed by, and
construed in accordance with, the laws of the State of Delaware applicable to
agreements made and to be performed wholly therein.
7
8
10. Entire Agreement. This Agreement contains the entire
agreement between the parties hereto with respect to the transactions
contemplated herein and supersedes all previously written or oral negotiations,
commitments, representations and agreements.
11. Execution in Counterpart. This Agreement may be executed in
one or more counterparts, each of which shall be deemed an original, but all of
which shall constitute one and the same instrument.
12. Amendments and Modifications. This Agreement shall only be
amended, changed or modified as specified in Section 17 of the Voting Trust.
13. Successors and Assigns. The Agreement shall be binding upon
the successors and assigns of the parties; provided, however, that this
Agreement shall not be assignable by the Initial Stockholder except to the
extent permitted herein.
IN WITNESS WHEREOF, the parties hereto have caused this
Agreement to be executed and delivered as of the date first above written.
INTERVU INC.
By: /s/ HARRY E. GRUBER
------------------------------------
Name:
Title:
INITIAL STOCKHOLDER:
/s/ HARRY E. GRUBER
---------------------------------------
Harry E. Gruber
8
9
INITIAL STOCKHOLDER'S SPOUSE:
The undersigned hereby accepts and agrees to all of the terms and conditions of
this Agreement to the extent the undersigned has, or may have, any ownership or
other interest in the Securities:
/s/ JOAN CUNNINGHAM
- ----------------------------------
Name:________________________
Address: P.O. Box 675272
--------------------------
Rancho Santa Fe, CA 92067
--------------------------
HARRY GRUBER, AS TRUSTEE, PURSUANT TO THE VOTING TRUST AGREEMENT DATED AS OF
AUGUST 28, 1995:
/s/ HARRY GRUBER
- ----------------------------------
Harry Gruber
9