EXHIBIT 4.4
EXECUTION VERSION
ROXIO, INC.
COMMON STOCK PURCHASE
AGREEMENT
THIS COMMON STOCK PURCHASE AGREEMENT
(this “ Agreement ”) is dated as of this
17 th day of June, 2004, by and between
ROXIO, INC., a Delaware corporation (the “ Company
”) and BEST BUY ENTERPRISE SERVICES, INC., a Minnesota
corporation (together with its permitted assigns, the “
Purchaser ”).
WHEREAS , the Company and the Purchaser are parties to
that certain Strategic Marketing Agreement, dated as of the date
hereof (the “ Strategic Marketing Agreement ”),
pursuant to which, among other things, the Purchaser will provide
Strategic Advice (as defined in the Strategic Marketing Agreement)
to the Company;
WHEREAS , in order to provide consideration for the
Purchaser’s obligations under the Strategic Marketing
Agreement, the Purchaser desires to purchase from the Company, and
the Company desires to sell to the Purchaser, effective as of the
date hereof, shares of the Company’s Common Stock, par value
$0.001 per share (the “ Shares ”);
WHEREAS , subject to the terms and conditions set forth
herein, the Purchaser desires to purchase from the Company and the
Company desires to sell to the Purchaser the Shares in three (3)
separate tranches as follows: (i) the first tranche to close as of
the date hereof (the “ Initial Closing ”), (ii)
the second tranche to close as soon as reasonably practicable, but
in no event later than two (2) business days, after the thirteen
(13) month anniversary of the date of this Agreement (the “
Second Closing ”), and (iii) the third tranche to
close as soon as reasonably practicable, but in no event later than
two (2) business days, after the eighteen (18) month anniversary of
the date of this Agreement (the “ Third Closing
”); and
WHEREAS , concurrently with the execution and delivery
of this Agreement, and as a condition and inducement to
Purchaser’s willingness to enter into this Agreement, the
Company and the Purchaser desire to execute a Registration Rights
Agreement (the “ Registration Rights Agreement
”), which is attached hereto as Exhibit A .
NOW, THEREFORE
, in consideration of the mutual
promises and covenants made herein and the mutual benefits to be
derived herefrom and for other good and valuable consideration, the
receipt of which is hereby acknowledged, the parties agree as
follows:
SECTION 1
Purchase and Sale of Common
Stock
1.1 Sale and Issuance of
Shares.
(a) First Tranche . Upon the
terms and subject to the conditions set forth in this Agreement,
Company shall sell to Purchaser and Purchaser shall buy from
Company the number of Shares equal to $5,000,000 divided by the
average closing selling price per share as reported by the National
Association of Securities Dealers on the Nasdaq National Market and
published in The Wall Street Journal for the ten trading days prior
to the date hereof (“Fair Market Value”) (i.e., one
million ninety-nine thousand six hundred twenty-six (1,099,626)
shares) on the date of this Agreement (the “ Initial
Closing ”) at a cash purchase price of $0.001 per share
(the “ Purchase Price ”).
(b) Second Tranche . Upon the
terms and subject to the conditions set forth in this Agreement,
Company shall sell to Purchaser and Purchaser shall buy from
Company the number of Shares equal to
$2,500,000 divided by the average
closing selling price per share as reported by the National
Association of Securities Dealers on the Nasdaq National Market and
published in The Wall Street Journal for the ten trading days prior
to the date of the Second Closing (“Fair Market Value”)
at the Purchase Price on the Second Closing, provided, however, if
the Strategic Marketing Agreement is terminated by Purchaser
pursuant to Section 6.3.1 thereof, the number of shares shall be
calculated using $416,666 instead of $2,500,000.
(c) Third Tranche . Upon the
terms and subject to the conditions set forth in this Agreement,
Company shall sell to Purchaser and Purchaser shall buy from
Company the number of Shares equal to $2,500,000 divided by the
average closing selling price per share as reported by the National
Association of Securities Dealers on the Nasdaq National Market and
published in The Wall Street Journal for the ten trading days prior
to the date of the Third Closing (“Fair Market Value”)
at the Purchase Price on the Third Closing.
(d) Share Limit . The total
number of Shares that may be purchased pursuant to this Agreement
shall not exceed, in the aggregate, 5,025,000 shares of Common
Stock of the Company (as adjusted for stock splits, stock
dividends, combinations or similar events with respect to such
shares).
1.2 Adjustments Upon Certain
Events.
The Purchase Price and the number of
Shares purchasable at each of the Second and Third Closings shall
be subject to adjustment from time to time upon the occurrence of
certain events described in this Section 1.2.
(a) If the Company shall at any time
during the ten trading day period used to calculate the number of
Shares the Purchaser may purchase at each of the Second and Third
Closing subdivide its Common Stock, by stock split or otherwise, or
combine its Common Stock, or issue additional shares of its Common
Stock as a dividend with respect to any shares of its Common Stock,
the number of Shares issuable at such Closing shall, if necessary,
be proportionately increased in the case of a subdivision or stock
dividend, or proportionately decreased in the case of a
combination. Appropriate adjustments shall also be made to the
Purchase Price as provided herein, but the aggregate purchase price
payable for the total number of Shares purchasable pursuant to this
Agreement (as adjusted) shall remain the same. Any adjustment under
this Section 1.2(a) shall become effective at the close of business
on the date of the subdivision or combination becomes effective or
as of the record date of such dividend, or in the event that no
record date is fixed, upon making of such dividend. Promptly after
any adjustment to the number or class of Shares purchasable at one
or both of the Second and Third Closings, the Company shall give
written notice thereof to the Purchaser no more than ten (10)
business days after such adjustment, setting forth in reasonable
detail and certifying the calculation of such
adjustment.
(b) In case of (i) any
reclassification, reorganization, or change or conversion in the
Common Stock of the Company (other than as a result of a
subdivision, combination, or stock dividend provided for in Section
1.2(a) above), including as a result of any merger or consolidation
with or into another corporation or other entity in which the
Company is not the surviving entity or in which the holders of the
Company’s outstanding voting stock immediately prior to such
transaction own, immediately after such transaction, securities
representing less than 50% of the voting power of the corporation
or other entity surviving such transaction, or (ii) any dividend or
distribution of Common Stock (other than as a result of a
subdivision, combination or stock dividend provided for in Section
1.2(a) above), or other securities which are at any time directly
or indirectly convertible into or exchangeable for any other
securities of the Company or another issuer, cash, evidence of
indebtedness of the Company or another issuer or any rights or
options to subscribe for, purchase or otherwise acquire any of the
foregoing by way of dividend or other distribution, then, as a
condition of such reclassification, reorganization, consolidation
with or into another person, change, dividend or distribution,
lawful provision shall be made, and duly executed documents
evidencing the same from the Company or its successor shall be
delivered to the Purchaser, so that the Purchaser shall have the
right to receive, subject to the other terms and conditions of this
Agreement, at each of the Second and Third Closing, the kind and
amount of shares of stock and other securities and property
receivable in connection with such reclassification,
reorganization, consolidation with or into another person,
change,
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dividend or distribution by a holder
of the same number of shares of Common Stock as would have been
receivable by the Purchaser immediately prior to such
reclassification, reorganization, consolidation with or into
another person, change, dividend or distribution if such had
occurred prior to such Second or Third Closing. In any such case
appropriate provisions shall be made with respect to the rights and
interest of the Purchaser so that the provisions hereof shall
thereafter be applicable with respect to any Shares or other
securities and property deliverable at the Second or Third Closing,
and appropriate adjustments shall be made to the Purchase Price as
provided herein; provided further the aggregate purchase price
shall remain the same. The Company shall provide the Purchaser with
written notice at least ten (10) business days prior to the
effective date of any such reclassification, reorganization,
consolidation with or into another person, change, dividend or
distribution.
1.3 Termination upon Certain
Events.
Notwithstanding anything else
contained herein to the contrary, this Agreement shall terminate
immediately upon the earlier of: (i) the liquidation or dissolution
of the Company, (ii) the date upon which all obligations with
respect to the Third Closing have been satisfied, and (iii) the
termination of the Strategic Marketing Agreement (or if such
agreement is terminated pursuant to Section 6.3.1 thereof, the date
upon which all obligations with respect to the Second Closing have
been satisfied).
SECTION 2
Closing Dates;
Delivery
2.1
Closing.
The purchase, sale and issuance of
the Shares shall take place at one or more closings (each of which
is referred to in this Agreement as a “ Closing
”). Subject to the satisfaction or waiver by the appropriate
party of all the conditions precedent to such Closing specified in
Section 5 and 6 hereof, the Initial Closing shall take place at the
offices of O’Melveny & Myers LLP, 2765 Sand Hill Road,
Menlo Park, California 94025, at 10:00 a.m. local time. Subject to
the satisfaction or waiver by the appropriate party of all the
conditions precedent to such Closing specified in Section 5 and 6
hereof, the Second Closing shall take place at the offices of
O’Melveny & Myers LLP, 2765 Sand Hill Road, Menlo Park,
California 94025, as soon as reasonably practicable after the
thirteen (13) month anniversary of this Agreement. Subject to the
satisfaction or waiver by the appropriate party of all the
conditions precedent to such Closing specified in Section 5 and 6
hereof, the Third Closing shall take place at the offices of
O’Melveny & Myers LLP, 2765 Sand Hill Road, Menlo Park,
California 94025, as soon as reasonably practicable after the
eighteen (18) month anniversary of this Agreement. The Second
Closing and the Third Closing shall be referred to herein as
“ Subsequent Closings .”
2.2
Delivery.
At each Closing, the Company will
deliver to Purchaser a certificate registered in the
Purchaser’s name representing the number of Shares that the
Purchaser is purchasing in such Closing against payment of the
Purchase Price, by (a) check payable to the Company, (b) wire
transfer in accordance with the Company’s instructions, (c)
cancellation of indebtedness or (d) any combination of the
foregoing.
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