O3B NETWORKS LIMITED RIGHT OF FIRST OFFER AGREEMENT (Initial Common Investor)
EXHIBIT 10.52
O3B NETWORKS LIMITED
RIGHT OF FIRST OFFER AGREEMENT
(Initial Common Investor)
(Initial Common Investor)
This Right of First Offer Agreement (the “Agreement”) is entered into as of the
4th day of January, 2008, by and among O3B Networks Limited, a private company
limited by shares organized under the laws of Jersey (the “Company”), LGI Ventures B.V.
(the “Preferred Investor”), ▇▇▇▇▇▇▇ ▇▇▇▇▇ (the “Founder”) and ▇▇▇▇ ▇▇▇▇ (the
"Initial Common Investor”).
Recitals
Whereas, the Preferred Investor is purchasing Series A Preference Shares of the
Company (the “Series A Preference Shares”) pursuant to that certain Series A Preference Share
Purchase Agreement (the “Purchase Agreement”) of even date herewith (the “Investment”);
Whereas, the Initial Common Investor is the holder of Common Shares of the Company;
Whereas, the Preferred Investor’s entry into the Purchase Agreement is expressly
conditioned upon the execution and delivery of this Agreement by the other parties hereto; and
Whereas, in connection with the consummation of the Investment, the parties desire to
enter into this Agreement in order to grant rights of first offer to the Company, the Preferred
Investor and the Founder and other rights as set forth below.
Now, Therefore, in consideration of these premises and for other good and valuable
consideration, the receipt and sufficiency of which are hereby acknowledged, the parties hereto
agree as follows:
SECTION 1. GENERAL.
1.1 Definitions.
(a) An “Affiliate” of a Person shall mean any person or entity that directly or indirectly,
through one or more intermediaries, controls, is controlled by, or is under common control with,
such Person.
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(b) “Business Day” means any day other than a day on which banking institutions in the Borough
of Manhattan, the City of New York, in the City and County of Denver, in London England, or in
Amsterdam, The Netherlands, are authorized or obligated by law, executive order or regulation to
close.
(c) “Common Shares” means the ordinary shares of the Company having a par value of £1.00 and
any securities of the Company issued as (or issuable upon the conversion or exercise of any
warrant, right or other security which is issued as) a dividend or other distribution with respect
to, or in exchange for or in replacement of, Common Shares.
(d) “ICI Shares” shall mean Common Shares now owned by the Initial Common Investor and any
Common Shares issued as (or issuable upon the conversion or exercise of any warrant, right or other
security which is issued as) a dividend or other distribution with respect to, or in exchange for
or in replacement of, Common Shares now owned by the Initial Common Investor.
(e) “Non-U.S. Legal Requirements” shall mean, in the case of a public offering or registration
of any of the Company’s securities on a public securities exchange (whether regulated or otherwise)
in the United Kingdom or elsewhere in the world other than the United States, all applicable laws,
regulations or other legal requirements necessary to permit the unrestricted sale of such
securities to be registered in such jurisdiction and on such market by the Company or the holders
of such securities, as the case may be.
(f) “Person” shall mean any individual, corporation, partnership, limited liability company,
joint venture, association, joint-stock company or trust.
(g) “Qualified IPO” shall mean the first firmly underwritten public offering pursuant to an
effective Registration Statement under the Securities Act or Non-U.S. Legal Requirements (i)
covering the offer and sale of Common Shares for the account of the Company that values the Company
at not less than €121,250,000 prior to the consummation of such offering and in which the net cash
proceeds to the Company (after underwriting discounts, commissions and fees) are at least
€34,750,000 (or its equivalent in U.S. dollars if such offering is effected in the United
States)and (ii) after which the Common Shares are listed on the New York Stock Exchange, the Nasdaq
Global Market, the Nasdaq Global Select Market or a designated offshore securities market (as
defined in Regulation S under the Securities Act).
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(h) “Registration Statement” shall mean (i) with respect to an offering of the Company’s
securities in the United States, a registration statement as defined in the Securities Act and (ii)
with respect to the offering of the Company’s securities in non-U.S. jurisdictions, the comparable
documents required under applicable Non-U.S. Legal Requirements for the relevant securities to be
registered, listed, admitted to trading or otherwise and includes, without limitation,
prospectuses, listing particulars and admission documents.
(i) “Securities Act” shall mean the U.S. Securities Act of 1933, as amended.
(j) The term “Transfer” shall include any sale, assignment, encumbrance, hypothecation,
pledge, conveyance in trust, gift, transfer by bequest, devise or descent, or other transfer or
disposition of any kind, including, but not limited to, transfers to receivers, levying creditors,
trustees or receivers in bankruptcy proceedings or general assignees for the benefit of creditors,
whether voluntary or by operation of law.
SECTION 2. Right of First Offer.
2.1 Right of First Offer on Initial Common Investor Transfers.
(a) Subject to Sections 2.1(d), if the Initial Common Investor desires to Transfer all or any
portion of the ICI Shares, he shall first submit a written notice (a “Request for Offer Notice”) to
the Company, the Founder and the Preferred Investor specifying the number of ICI Shares he proposes
to Transfer (the “Offered ICI Shares”). If the Company, the Founder or the Preferred Investor
(each, an “Offeror”) desires to purchase for cash any or all of the Offered ICI Shares, the Offeror
shall so notify the Initial Common Investor in writing (with a copy to the other Offeror) within
ten (10) days after the Request for Offer Notice was given (the “Proposal Period”), specifying the
number of Offered ICI Shares it desires to purchase and the cash purchase price per share it is
willing to pay (a “Purchase Proposal”).
(b) The Initial Common Investor in his sole discretion shall elect whether or not it desires
to accept a Purchase Proposal from any of the Offerors, but if the Initial Common Investor accepts
only one Purchase Proposal, that Purchase Proposal must be the one that offers the highest cash
purchase price per share. If the Initial Common Investor elects to accept a Purchase Proposal from
an Offeror he shall do so by notifying the Offeror(s) in writing (an “Acceptance Notice”) within
ten (10) days after the applicable Purchase Proposal notice was
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given. Unless the parties shall otherwise agree or unless extended to obtain governmental
approvals, the closing of any purchase of the Offered ICI Shares by the Company, the Founder and/or
the Preferred Investor pursuant to this Section 2.1 (the “Closing”) shall occur on the last
Business Day that occurs on or immediately preceding thirty (30) days following the giving of the
Acceptance Notice by the Initial Common Investor (subject to an extension of up to ninety (90)
additional days to the extent necessary in order to receive any governmental approvals required for
the consummation of such Transfer). If extended, the Closing shall occur on the fifth
(5th) Business Days following the receipt of applicable governmental approvals. The
Closing shall take place at 9:00 am, local time, at the office of legal counsel for the Company (or
if the Company is not purchasing any Offered ICI Shares, at the office of legal counsel for the
Founder or the Preferred Investor, whichever is purchasing the greater number of ICI Shares),
unless the parties agree to a different time and place. At the Closing, the Initial Common
Investor shall deliver the certificate(s) representing such Offered ICI Shares, properly endorsed
for transfer, against receipt of the purchase price therefor, which shall be paid by wire transfer
of immediately available funds to an account that is designated by the Initial Common Investor at
least three (3) Business Days prior to the Closing, which account shall be at a bank that will
accept wire transfers on any Business Day. Any Offered ICI Shares purchased by the Company shall
thereupon be cancelled and cease to be issued and outstanding. Each party to this Agreement shall
cooperate with and use commercially reasonable efforts to assist the party or parties purchasing
the Offered ICI Shares, at the purchasing party’s or parties’ expense, obtain any governmental
approvals required for the consummation of such purchase.
(c) The Initial Common Investor shall be free to Transfer any or all of the Offered ICI Shares
not sold pursuant to a Purchase Proposal under Section 2(b) to any third party free of any
restriction under this Agreement; provided that if the aggregate number of Offered ICI Shares that
the Offerors have timely offered to purchase is equal to or greater than the total number of
Offered ICI Shares, (i) such Transfer must occur within one hundred and eighty (180) days (subject
to an extension of up to ninety (90) additional days to the extent necessary in order to receive
any governmental approvals required for the consummation of such Transfer) following the expiration
of the Proposal Period and (ii) the price, in cash, at which the Initial Common Investor Transfers
any Offered ICI Shares to the third party must be no less than the Minimum Price (as defined below)
for such Transfer. Each party to this Agreement shall cooperate with and use commercially
reasonable efforts to assist the party or parties purchasing Offered ICI Shares, at the purchaser’s
or purchasers’ expense, obtain any governmental approvals
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required for the consummation of such purchase. If the Offered ICI Shares are not Transferred within
the time period set forth above in this Section 2.1(c), then the procedures set in Section 2.1
shall again apply to any Transfer of any of the Offered ICI Shares. For purposes of this
Agreement, the “Minimum Price” for a Transfer shall mean the highest price at which the Offered ICI
Shares subject to the Transfer could have been sold pursuant to any or all Purchase Proposals under
Section 2(b) that were not accepted by the Initial Common Investor had the Initial Common Investor
been able to accept each such Purchase Proposal in whole or in part. For example, if the Offered
ICI Shares are 200 and the Initial Common Investor received two Purchase Proposals, one for 150
Offered ICI Shares at €10.00 and the other for 100 Offered ICI Shares at €8.00, neither of which
was accepted, and the Initial Common Investor desires to Transfer 150 Offered ICI Shares, then the
Minimum Price would be €10.00 per Offered ICI Share. If the Initial Common Investor desires to
Transfer 200 Offered ICI Shares, then the Minimum Price would be €9.50 per Offered ICI Share, and
if the Initial Common Investor desires to Transfer 175 Offered ICI Shares, then the Minimum Price
would be €9.71 per Offered ICI Share.
(d) Notwithstanding the foregoing, the first offer rights of the Company, the Founder and the
Preferred Investor set forth in this Section 2.1 shall not apply to:
(i) Any Transfer by the Initial Common Investor without consideration to the Initial Common
Investor’s ancestors, descendants, spouse, familial like parties or to trusts for the benefit of
such persons or the Initial Common Investor; provided that the transferee of any shares from the
Initial Common Investor shall enter into a written agreement to be bound by and comply with this
Agreement as if it were an original “Initial Common Investor” hereunder;
(ii) Any Transfer by the Initial Common Investor to an Affiliate of the Initial Common
Investor; provided that such Affiliate shall enter into a written agreement to be bound by and
comply with this Agreement as if it were an original “Initial Common Investor” hereunder;
(iii) Any Transfer to the Initial Common Investor’s estate or by such estate by bequest,
devise or descent; provided that the transferee of any ICI Shares shall enter into a written
agreement to be bound by and comply with this Agreement as if it were an original “Initial Common
Investor” hereunder; and
(iv) Any pledge by the Initial Common Investor of ICI Shares that creates a mere security
interest in the pledged ICI Shares; provided that the
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pledgee of any ICI Shares from the Initial Common Investor shall enter into a written
agreement to be bound and comply with this Agreement as if it were an original “Initial Common
Investor” hereunder.
(v) Any Transfer of New Investor Shares without consideration to a charitable organization.
Upon the completion of any Transfer in compliance with clauses (i) through (iv) of this Section
2.1(d), the transferee shall become a “Initial Common Investor” and the Transferred ICI Shares
shall remain “ICI Shares” for all purposes of this Agreement.
SECTION 3. Legend and “Market Stand-Off” Agreement.
3.1 Legend.
(a) Each certificate representing ICI Shares now or hereafter owned by the Initial Common
Investor shall be endorsed with the following legend:
“THE SALE, PLEDGE, HYPOTHECATION OR TRANSFER OF THE SECURITIES REPRESENTED
BY THIS CERTIFICATE IS SUBJECT TO A CERTAIN RIGHT OF FIRST OFFER AGREEMENT
IN FAVOR OF THE COMPANY, ▇▇▇▇▇▇▇ ▇▇▇▇▇ AND LGI VENTURE, B.V. COPIES OF SUCH
AGREEMENT MAY BE OBTAINED UPON WRITTEN REQUEST TO THE SECRETARY OF THE
COMPANY.”
(b) The Initial Common Investor agrees that the Company may instruct its transfer agent to
impose transfer restrictions on the shares represented by certificates bearing the legend referred
to in Section 3.1(a) above to enforce the provisions of this Agreement and the Company agrees to
promptly do so. The legend shall be removed at the request of the Initial Common Investor
following termination of the applicable rights of first offer set forth in Section 2 of this
Agreement.
3.2 “Market Stand-Off” Agreement. The Initial Common Investor hereby agrees that he shall not
sell, transfer, make any short sale of, grant any option for the purchase of, or enter into any
hedging or similar transaction with the same economic effect as a sale, any ICI Shares (or other
securities of the Company) held by the Initial Common Investor (other than those included in the
relevant Registration Statement) (i) during the 180-day period following the
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effective date of a Qualified IPO (or such longer period, not to exceed 18 days after the
expiration of the 180-day period, as the underwriters or the Company shall request in order to
facilitate compliance with NASD Rule 2711 or NYSE Member Rule 472 or any successor or similar rule
or regulation (collectively, “Applicable Exchange Rules”)) and (ii) if requested by the
underwriters, the 90-day period following the effective date of a registration statement of the
Company filed under the Securities Act or (or such longer period, not to exceed 18 days after the
expiration of the 90-day period, as the underwriters or the Company shall request in order to
facilitate compliance with Applicable Exchange Rules). The obligations described in this Section
3.2 shall not apply to a registration relating solely to employee benefit plans on Form S-1 or Form
S-8 or similar forms that may be promulgated in the future, or a registration relating solely to a
transaction on Form S-4 or similar forms that may be promulgated in the future.
SECTION 4. MISCELLANEOUS.
4.1 Governing Law. This Agreement shall be governed by and construed under the laws of the
State of New York in all respects as such laws are applied to agreements among New York residents
entered into and to be performed entirely within New York, without reference to conflicts of laws
or principles thereof. The parties agree that any action brought by either party under or in
relation to this Agreement, including without limitation to interpret or enforce any provision of
this Agreement, shall be brought in, and each party agrees to and does hereby submit to the
jurisdiction and venue of, any state or federal court located in the City and County of New York.
4.2 Amendment. Any provision of this Agreement may be amended or modified and/or the
observance thereof may be waived or this Agreement terminated, only with the written consent of (i)
the Company, (ii) the Preferred Investor, (iii) the Founder and (iv) the Initial Common Investor;
provided that no such consent shall be required from the Company to amend any provision of this
Agreement other than Section 3 in the event that the Company’s first offer rights have terminated
in accordance with Section 4.4.
4.3 Successors and Assigns. The provisions hereof shall inure to the benefit of, and be
binding upon the parties hereto and their respective successors and permitted assigns; provided
that, except for an assignment by the Preferred Investor to an Affiliate of the Preferred Investor,
no party hereto may assign its rights under this Agreement without the consent of the other parties
hereto whose first offer rights have not terminated pursuant to Section 4.4.
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4.4 Term. This Agreement shall continue in full force and effect from the date hereof through
the date on which the Initial Common Investor does not own any ICI Shares; provided that the rights
of the Company, the Founder and the Preferred Investor set forth in Section 2.1 shall terminate
upon the closing of a Qualified IPO.
4.5 Notices. All notices required or permitted hereunder shall be in writing and shall be
deemed effectively given: (a) upon personal delivery to the party to be notified, or (b) upon
receipt of confirmation of delivery to the party to be notified by Federal Express, DHL, UPS or a
similar reputable international overnight courier service. All communications shall be sent to the
party to be notified at the address as set forth on the signature page hereof or at such other
address as such party may designate by written notice to the other parties hereto.
4.6 Severability. In the event one or more of the provisions of this Agreement should, for
any reason, be held to be invalid, illegal or unenforceable in any respect, such invalidity,
illegality, or unenforceability shall not affect any other provisions of this Agreement, and this
Agreement shall be construed as if such invalid, illegal or unenforceable provision had never been
contained herein.
4.7 Attorneys’ Fees. In the event that any suit or action is instituted under or in relation
to this Agreement, including without limitation to enforce any provision in this Agreement, the
prevailing party in such dispute shall be entitled to recover from the losing party all reasonable
fees, costs and expenses of enforcing any right of such prevailing party under or with respect to
this Agreement, including without limitation, such reasonable fees and expenses of attorneys and
accountants, which shall include, without limitation, all reasonable fees, costs and expenses of
appeals.
4.8 Entire Agreement. This Agreement constitutes the full and entire understanding and
agreement between the parties with regard to the subjects hereof and no party shall be liable or
bound to any other in any manner by any oral or written representations, warranties, covenants and
agreements except as specifically set forth herein. Each party expressly represents and warrants
that it is not relying on any oral or written representations, warranties, covenants or agreements
outside of this Agreement.
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4.9 Counterparts. This Agreement may be executed in two or more counterparts, each of which
shall be deemed an original, but all of which together shall constitute one and the same
instrument.
[THIS SPACE INTENTIONALLY LEFT BLANK]
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In Witness Whereof, the parties hereto have executed this Right of First Offer
Agreement as of the date set forth in the first paragraph hereof.
| COMPANY: | PREFERRED INVESTOR: | |||||||||||
| O3B NETWORKS LIMITED | LGI VENTURES B.V. | |||||||||||
By: |
/s/ ▇▇▇▇ ▇▇▇▇▇ | By: | /s/ ▇▇▇▇▇▇ ▇▇▇ ▇▇▇ | |||||||||
| Name: ▇▇▇▇ ▇▇▇▇▇ | Name: | |||||||||||
| Title: CEO | Title: | |||||||||||
| By: | /s/ ▇▇▇▇▇ ▇▇▇▇▇ | |||||||||||
| ▇▇▇▇▇ ▇▇▇▇▇ | ||||||||||||
| O3B Networks Limited | Address: | |||||||||||
| ▇▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇▇ | ||||||||||||
| ▇▇. ▇▇▇▇▇▇, ▇▇▇▇▇▇ ▇▇▇ ▇▇▇ | ||||||||||||
| FOUNDER: | INITIAL COMMON INVESTOR: | |||||||||||
| /s/ ▇▇▇▇ ▇▇▇▇▇ | /s/ ▇▇▇▇ ▇▇▇▇ | |||||||||||
| ▇▇▇▇▇▇▇ ▇▇▇▇▇ | ▇▇▇▇ ▇▇▇▇ | |||||||||||
| Address: | ▇.▇. ▇▇▇ ▇▇▇▇▇▇ #▇▇▇▇▇ | Address: | St. John’s Manor | |||||||||
| Miami, Florida 33102-5250 | Jersey, C.I. JE3 4EH | |||||||||||
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