1
Registration Rights Agreement
between
Xoom.com, Inc.
and
ValueVision International, Inc.
Dated: September 13, 1999
2
Registration Rights Agreement
EXHIBIT 10.9
[EXECUTION COPY]
REGISTRATION RIGHTS AGREEMENT
THIS REGISTRATION RIGHTS AGREEMENT (this "Agreement") is made and
entered into as of September 13, 1999, by and between ValueVision International,
Inc., a Minnesota corporation (together with its successors and assigns, the
"Company"), and Xoom.com, Inc., a Delaware corporation (together with its
successors and assigns, "Xoom").
RECITALS
WHEREAS, pursuant to a Warrant Purchase Agreement, dated as of the
date hereof (the "Warrant Purchase Agreement"), among the Company, Snap! LLC
and Xoom, Xoom will acquire a warrant to purchase shares of common stock, par
value $0.01 per share, of the Company (the "Common Stock");
WHEREAS, in consideration of the Warrant Purchase Agreement, the
Company has agreed to provide to Xoom certain registration rights under the
Securities Act (as defined below).
NOW, THEREFORE, in consideration of the Warrant Purchase Agreement,
the mutual promises and agreements set forth herein and therein, and other
valuable consideration, the receipt and sufficiency of which is hereby
acknowledged, the parties hereto hereby agree as follows:
Section 1. Definitions. For purposes of this Agreement, the following
capitalized terms have the following meanings:
"Prospectus": The prospectus included in any Registration Statement
(including, without limitation, a prospectus that discloses information
previously omitted from a prospectus filed as part of an effective registration
statement in reliance upon Rule 430A under the Securities Act), as amended or
supplemented by any prospectus supplement, with respect to the terms of the
offering of any portion of the Registrable Securities covered by such
Registration Statement and all other amendments and supplements to such
prospectus, including post-effective amendments, and all material incorporated
by reference or deemed to be incorporated by reference in such prospectus.
"Registrable Securities": All shares of Common Stock issued or
issuable to Xoom upon the consummation of the Warrant Purchase Agreement.
Registrable Securities shall also include any shares of Common Stock or other
securities (or shares of Common Stock underlying such other securities) that
may be received by Xoom (x) as a result of a stock dividend on or stock split
of Registrable Securities or (y) on account of Registrable Securities in a
recapitalization of or other transaction involving the Company.
"Registration Expenses": All expenses, except as otherwise stated
in the definition of Selling Expenses, incurred by the Company in complying with
Section 2 hereof, including, without limitation, all registration,
qualification and filing fees, printing expenses, escrow fees, fees and
disbursements of counsel for the Company, blue sky fees and expenses, the
expense of
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Registration Rights Agreement 2
any special audits incident to or required by any such registration (but
excluding the compensation of regular employees of the Company which shall be
paid in any event by the Company) and the reasonable fees and disbursements of
one counsel for all selling shareholders in the event of participation by such
selling shareholders.
"Registration Statement": Any registration statement of the Company
under the Securities Act that covers any of the Registrable Securities pursuant
to the provisions of this Agreement, including the related Prospectus, any
preliminary prospectus, all amendments and supplements to such registration
statement (including post-effective amendments), all exhibits and all material
incorporated by reference or deemed to be incorporated by reference in such
registration statement.
"SEC": The Securities and Exchange Commission.
"Securities Act": The Securities Act of 1933, as amended, and the
rules and regulations promulgated thereunder.
"Selling Expenses": All underwriting discounts, selling commissions
and stock transfer taxes applicable to the securities registered by Xoom and,
except as set forth in the definition of Registration Expenses, all reasonable
fees and disbursements of counsel for Xoom.
"Underwritten Offering": A distribution, registered pursuant to the
Securities Act, in which securities of the Company are sold to the public
through one or more underwriters.
Section 2. Piggyback Registration.
(a) Right to Piggyback. If at any time the Company proposes to file a
Registration Statement, whether or not for sale for the Company's own account,
on a form and in a manner that would also permit registration of Registrable
Securities, the Company shall give to Xoom, written notice of such proposed
filing at least fifteen (15) days before the anticipated filing. The notice
referred to in the preceding sentence shall offer Xoom the opportunity to
register such amount of Registrable Securities as Xoom may request (a
"Piggyback Registration"). If the registration of which the Company gives
notice is for an Underwritten Offering, the right of Xoom to registration
pursuant to this Section 2 shall be conditioned upon Xoom's participation in
such underwriting and the inclusion of Registrable Securities in the
underwriting to the extent provided herein. If Xoom elects to participate in
such Underwritten Offering, Xoom shall (together with the Company and other
selling shareholders) enter into an underwriting agreement in customary form
with the managing underwriter selected for such underwriting by the Company.
Subject to Section 2(b), the Company will include in each such Piggyback
Registration all Registrable Securities with respect to which the Company has
received written requests for inclusion therein. Xoom will be permitted to
withdraw all or part of the Registrable Securities from a Piggyback
Registration at any time prior to the effective date of such Piggyback
Registration. Unless otherwise provided herein, the Company will not be
obligated to effect any registration of Registrable Securities under this
Section 2 as a result of the registration of any of its securities solely in
connection with mergers, acquisitions, exchange offers, dividend reinvestment
and share purchase plans offered solely to current holders of Common Stock,
rights offerings or option or other employee benefit plans.
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Registration Rights Agreement 3
(b) Priority of Piggyback Registrations. The Company will cause the
managing underwriter or underwriters of a proposed Underwritten Offering on
behalf of the Company to permit Xoom to include therein all such Registrable
Securities requested to be so included on the same terms and conditions as any
securities of the Company included therein. Notwithstanding the foregoing, if
the managing underwriter or underwriters of such Underwritten Offering
determines that marketing factors require a limitation of the number of shares
to be underwritten then the number of Registrable Securities to be included in
such registration shall be limited to the number of Registrable Securities
that, in the written opinion of such managing underwriter or underwriters, can
be sold without materially and adversely affecting the success of such
Underwritten Offering provided that the securities of any holder or holders of
securities who have registration rights which are superior to those of Xoom
shall receive priority in such Underwritten Offering to the full extent of the
securities such holder or holders desire to sell and the remaining allocation
available for sale, if any, shall be allocated pro rata among all other
holders, including Xoom, on the basis of the amount of securities requested to
be included therein by each such holders. The managing underwriter or
underwriters, applying the same standard, may also exclude entirely from such
offering all Registrable Securities proposed to be included such offering to the
extent the Registrable Securities are not of the same class as securities of the
Company included in such offering.
(c) Limitations on Subsequent Piggyback Registration Rights. From and
after the date of this Agreement, the Company shall not enter into any
agreement granting any holder or prospective holder of any securities of the
Company any piggyback registration rights with respect to such securities
unless the priority for such new piggyback registration rights are on a pari
passu basis with the piggyback registration rights granted to Xoom hereunder.
(d) Expenses of Registration. All Registration Expenses incurred in
connection with all registrations pursuant to Section 2 shall be borne by the
Company. Unless otherwise stated, all Selling Expenses relating to securities
registered on behalf of Xoom shall be borne by Xoom pro rata on the basis of
the number of shares registered.
(e) Registration Procedures. In the case of each registration,
qualification or compliance effected by the Company pursuant to this Section 2,
in which Xoom elects to participate, the Company will keep Xoom advised in
writing as to the initiation of each registration, qualification and compliance
and as to the completion thereof. At its expense the Company will:
(i) Prepare and file with the Commission a registration statement
with respect to such securities and use its best efforts to cause
such registration statement to become and remain effective for at
least ninety (90) days; and
(ii) Furnish to Xoom (if Xoom is participating in such registration)
and to the underwriters of the securities being registered such
reasonable number of copies of the registration statement,
preliminary prospectus, final prospectus and such other documents
as such underwriters may reasonably request in order to facilitate
the public offering of such securities.
Section 5. Indemnification.
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Registration Rights Agreement 5
(a) Indemnification by the Company. The Company will, without limitation
as to time, indemnify and hold harmless, to the fullest extent permitted by
law, Xoom, the officers, directors and agents and employees of Xoom, each
person who controls Xoom (within the meaning of Section 15 of the Securities
Act or Section 20 of the Exchange Act) and the officers, directors, agents and
employees of any such controlling person, from and against all losses, claims,
damages, liabilities, costs (including, without limitation, the costs of
investigation and attorneys' fees) and expenses (collectively, "Losses"), as
incurred, arising out of or based upon any untrue or alleged untrue statement
of a material fact contained in any Registration Statement, Prospectus or form
of Prospectus or in any amendment or supplement thereto or in any preliminary
prospectus, or arising out of or based upon any omission or alleged omission to
state therein a material fact required to be stated therein or necessary to
make the statements therein not misleading, except insofar and to the extent
that any such Losses arise out of or are based upon an untrue statement or as
the same are based upon information furnished in writing to the Company by Xoom
expressly for use therein; provided, however, that the Company will not be
liable to Xoom to the extent alleged untrue statement or omission or alleged
omission made in any Registration Statement, Prospectus or preliminary
prospectus if either (A)(i) Xoom failed to send or deliver a copy of the
Prospectus with or prior to the delivery of written confirmation of the sale by
Xoom of a Registrable Security to the person asserting the claim from which
such Losses arise and (ii) the Prospectus would have corrected such untrue
statement or alleged untrue statement, omission or alleged omission; or (B)
such untrue statement or alleged untrue statement, omission or alleged omission
is corrected in an amendment or supplement to the Prospectus previously
furnished by or on behalf of the Company with copies of the Prospectus, and
Xoom thereafter fails to deliver such Prospectus as so amended or supplemented
prior to or concurrently with the sale of a Registrable Security to the person
asserting the claim from which such Losses arise. Further the Company will not
be liable to Xoom to the extent that any such Losses arise out of or are based
upon any omission or alleged omission to state therein a material fact required
to be stated therein or necessary to make the statements therein not
misleading, to the extent, but only to the extent, that such untrue statement
or omission is contained in any information so furnished in writing by Xoom to
the Company expressly for use in such Registration Statement, Prospectus or
preliminary prospectus and was used by the Company in the preparation of such
Registration Statement, Prospectus or preliminary prospectus.
(b) Indemnification by Xoom. In connection with any Registration Statement
in which Xoom is participating, Xoom will furnish to the Company in writing
such information as the Company reasonably requests for use in connection with
any Registration Statement, Prospectus or preliminary prospectus and will
indemnify, to the fullest extent permitted by law, the Company, its directors
and officers, agents and employees, each person who controls the Company
(within the meaning of Section 15 of the Securities Act and Section 20 of the
Exchange Act), and the directors, officers, agents or employees of such
controlling persons, from and against all Losses, as incurred, arising out of
or based upon any untrue or alleged untrue statement of a material fact
contained in any Registration Statement, Prospectus or form of Prospectus or in
any amendment or supplement thereto or in any preliminary prospectus, or
arising out of or based upon any omission or alleged omission to state therein
a material fact required to be stated therein or necessary to make the
statements therein not misleading, to the extent, but only to the extent, that
such untrue statement or omission is contained in any information so furnished
in writing by Xoom to the Company expressly for use in such Registration
Statement, Prospectus or preliminary prospectus and was used by the Company in
the preparation of such Registration Statement, Prospectus or preliminary
prospectus. In no
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event will the liability of ValueVision hereunder be greater in amount than the
dollar amount of the proceeds (net of payment of all expenses) received by Xoom
upon the sale of the Registrable Securities giving rise to such indemnification
obligation.
(c) Conduct of Indemnification Proceedings. If any person shall become
entitled to indemnity hereunder (an "indemnified party"), such indemnified
party shall give prompt notice to the party from which such indemnity is sought
(the "indemnifying party") of any claim or of the commencement of any action
or proceeding with respect to which such indemnified party seeks indemnification
or contribution pursuant hereto; provided, however, that the failure to so
notify the indemnifying party will not relieve the indemnifying party from any
obligation or liability except, to the extent that the indemnifying party has
been prejudiced materially by such failure. The indemnifying party shall have
the right to participate in, and, to the extent the indemnifying party so
desires, jointly with any other indemnifying party similarly noticed, to assume
the defense thereof with counsel mutually satisfactory to the parties; provided,
however, that an indemnified party (together with all other indemnified parties
which may be represented without conflict by one counsel) shall have the right
to retain one separate counsel, with the fees and expenses to be paid by the
indemnifying party, if representation of such indemnified party by the counsel
retained by the indemnifying party would be inappropriate due to actual or
potential differing interest between such indemnified party and any other party
represented by such counsel in such proceeding. All fees and expenses (including
any reasonable fees and expenses incurred in connection with investigating or
preparing to defend such action or proceeding) will be paid to the indemnified
party (provided appropriate documentation for such expenses is also submitted to
the indemnifying party), as incurred, within five calendar days of written
notice thereof to the indemnifying party (regardless of whether it is ultimately
determined that an indemnified party is not entitled to indemnification
hereunder). The indemnifying party will not consent to entry of any judgment or
enter into any settlement or otherwise seek to terminate any action or
proceeding in which any indemnified party is or could be a party and as to which
indemnification or contribution could be sought by such indemnified party under
this Section 8, unless such judgment, settlement or other termination includes
as an unconditional term thereof the giving by the claimant or plaintiff to such
indemnified party of a release, in form and substance reasonably satisfactory to
the indemnified party, from all liability in respect of such claim or litigation
for which such indemnified party would be entitled to indemnification hereunder.
(d) Contribution. If the indemnification provided for in this Section
5 is unavailable to an indemnified party under Section 5(a) or 5(b) in respect
of any Losses or is insufficient to hold such indemnified party harmless, then
each applicable indemnifying party, in lieu of indemnifying such indemnified
party, will, severally but not jointly, contribute to the amount paid or payable
by such indemnified party as a result of such Losses, in such proportion as is
appropriate to reflect the relative fault of the indemnifying party or
indemnifying parties, on the one hand, and such indemnified party, on the other
hand, in connection with the actions, statements or omissions that resulted in
such Losses, as well as any other relevant equitable considerations. The
relative fault of such indemnifying party or indemnifying parties, on the one
hand, and such indemnified party, on the other hand, will be determined by
reference to, among other things, whether any action in question, including any
untrue or alleged untrue statement of a material fact or omission or alleged
omission of a material fact, has been taken or made by, or related to
information supplied by, such indemnifying party or indemnified party, and the
parties' relative intent, knowledge, access to information and opportunity to
correct or prevent such action, statement or omission. The amount paid or
payable by a party as a result of any Losses
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Registration Rights Agreement 6
will be deemed to include any legal or other fees or expenses incurred by such
party in connection with any action or proceeding.
The parties hereto agree that it would not be just and equitable if
contribution pursuant to this Section 5(d) were determined by pro rata
allocation or by any other method of allocation that does not take into account
the equitable considerations referred to in the immediately preceding
paragraph. Notwithstanding the provisions of this Section 5(d), Xoom will not be
required to contribute any amount in excess of the amount by which the net
proceeds which the Registrable Securities sold by such indemnifying party and
distributed to the public were offered to the public exceeds the amount of any
damages that such indemnifying party has otherwise been required to pay by
reason of such untrue or alleged untrue statement or omission or alleged
omission. No person guilty of fraudulent misrepresentation (within the meaning
of Section 11(f) of the Securities Act) will be entitled to contribution from
any person who was not guilty of such fraudulent misrepresentation.
The indemnity, contribution and expense reimbursement obligations of the
Company hereunder will be in addition to any liability the Company may
otherwise have hereunder or otherwise. The provisions of this Section 5 will
survive so long as Registrable Securities remain outstanding, notwithstanding
any permitted transfer of the Registrable Securities by Xoom thereof or any
termination of this Agreement.
Section 6. Underwritten Registrations. If any Piggyback Registration is an
Underwritten Offering, the Company will have the exclusive right to select the
investment banker or investment bankers and managers to administer the
offering. Each party hereto agrees that, in connection with any Underwritten
Offering hereunder, it shall undertake to offer customary indemnification to
the participating underwriters.
Section 7. Miscellaneous.
(a) Remedies. In the event of a breach by the Company of its
obligations under this Agreement, Xoom, in addition to being entitled to
exercise all rights granted by law, including recovery of damages, will be
entitled to specific performance of its rights under this Agreement. The
Company agrees that monetary damages would not be adequate compensation for any
loss incurred by reason of a breach by it of any provision of this Agreement
and hereby further agrees that, in the event of any action for specific
performance in respect of such breach, it will waive the defense that a remedy
at law would be adequate.
(b) Amendments and Waivers. The provisions of this Agreement may not
be amended, modified or supplemented without the prior written consent of the
Company and Xoom.
(c) Notices. Except as set forth below, all notices and other
communications provided for or permitted hereunder shall be in writing and
shall be deemed to have been duly given if delivered personally or sent by
telex or facsimile, registered or certified mail (return receipt requested),
postage prepaid or courier or overnight delivery service to the Company and
Xoom at the addresses listed in the Warrant Purchase Agreement (or at such
other address for any party as shall be specified by like notice, provided that
notices of a change of address shall be effective only upon receipt thereof).
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Registration Rights Agreement 7
(d) Successors and Assigns. Any transferee of all or a portion of the
Registrable Securities shall succeed to Xoom's rights and obligations hereunder
to the extent it agrees in writing, to be bound by all of the provisions
applicable hereunder to Xoom. Subject to the requirements of this Section 7(d),
this Agreement shall inure to the benefit of and be binding upon the successors
and assigns of the parties hereto. Xoom shall not assign any of its rights
hereunder to any third party except in connection with the transfer of
beneficial ownership of a number of shares equal to at least 50% of the Shares
issuable to Xoom pursuant to the Warrant Purchase Agreement which transferee
shall have agreed in writing to be bound by all of the provisions applicable
hereunder to Xoom. Upon consummation of the Reorganization (as such term is
defined in the Warrant Purchase Agreement), Xoom may assign its rights and
obligations under this Agreement to NBCi in connection with the transfer of its
Registrable Securities to NBCi.
(e) Counterparts. This Agreement may be executed in any number of
counterparts and by the parties hereto in separate counterparts, each of which
when so executed will be deemed to be an original and all of which taken
together will constitute one and the same instrument.
(f) Headings. The headings in this Agreement are for convenience of
reference only and will not limit or otherwise affect the meaning.
(g) Governing Law. This agreement will be governed by and construed in
accordance with the laws of the State of New York applicable to contracts
executed and performed within such state, and each party hereby submits to the
jurisdiction of any state or U.S. federal court sitting within the County of New
York, New York. The parties hereto waive all rights to trial by jury in any
action, suit or proceeding brought to enforce or defend any rights or remedies
under this Agreement.
(h) Severability. If any term, provision, covenant or restriction of this
Agreement is held by a court of competent jurisdiction to be invalid, void or
unenforceable, the remainder of the terms, provisions, covenants and
restrictions set forth herein will remain in full force and effect and will in
no way be affected, impaired or invalidated, and the parties hereto will use
their best efforts to find and employ an alternative means to achieve the same
or substantially the same result as that contemplated by such term, provision,
covenant or restriction. It is hereby stipulated and declared to be the
intention of the parties that they would have executed the remaining terms,
provisions, covenants and restrictions without including any of such which may
be hereafter declared invalid, void or unenforceable.
(i) Termination. This Agreement shall terminate upon the date upon which
Xoom shall be able to dispose of all of its remaining Registrable Securities in
any one day without registration pursuant to Rule 144 of the Securities Act.
(j) Entire Agreement. This Agreement is intended by the parties as a final
expression of their agreement and intended to be the complete and exclusive
statement of the agreement and understanding of the parties hereto in respect of
the subject matter contained herein. There are no restrictions, promises,
warranties or undertakings, other than those set forth or referred to herein,
with respect to such subject matter. This Agreement supersedes all prior
agreements and understandings between the parties with respect to such subject
matter.
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[Signature page follows]
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IN WITNESS WHEREOF, the parties have executed this Agreement as of the
date first written above.
VALUEVISION INTERNATIONAL, INC.
By: /s/ Gene McCaffrey
--------------------------------------
Name: Gene McCaffrey
Title: Chief Executive Officer
XOOM.COM, INC.
By: /s/ Chris Kitze
----------------------------------------
Name: Chris Kitze
Title: Chairman
[VALUE VISION REGISTRATION RIGHTS AGREEMENT]