Exhibit 10.4
RIGHT OF FIRST REFUSAL
AGREEMENT
THIS RIGHT OF FIRST REFUSAL
AGREEMENT (the “Agreement”) is made as of the 15th day
of July, 2005 by and among Eons, Inc., a Delaware corporation (the
“Company”), General Catalyst Group III, L.P., a
Delaware limited partnership (“GCP Group III”), GC
Entrepreneurs Fund III, L.P., a Delaware limited partnership
(“GCP Entrepreneurs III” and together with GCP Group
III, “GCP”), Monster Worldwide, Inc., a Delaware
corporation (“Monster Worldwide”), and Jeffrey C.
Taylor (“Taylor”). GCP, Monster Worldwide and
Taylor are referred to herein individually each as an
“Investor” and collectively as the
“Investors.”
WHEREAS, this Agreement in being
entered into in connection with the Company’s July 2005
financing, pursuant to which on the date hereof, the Company will
issue and sell, and the Investors will purchase and acquire,
certain securities of the Company (the “July 2005
Financing”).
NOW, THEREFORE, in consideration of
the mutual covenants set forth herein, and for other good and
valuable consideration, the receipt and sufficiency of which are
acknowledged, the Company and the Investors agree as
follows:
1.
Definitions
.
(a)
“Company
Notice” means written notice from the Company notifying
Taylor that it intends to exercise its right of first refusal under
Section 2(a) as to some or all of the Transfer Stock proposed to be
transferred in any Proposed Transfer.
(b)
“Investor
Notice” means written notice from either GCP or Monster
Worldwide notifying the Company and Taylor that such Investor
intends to exercise its Secondary Refusal Right as to a portion of
the Transfer Stock with respect to any Proposed
Transfer.
(c)
“Monster
Note” means the Note issued to Monster Worldwide pursuant to
the terms of the Subscription Agreement between the Company and
Monster Worldwide, dated as of the date hereof.
(d)
“Proposed
Transfer” means any proposed assignment, sale, offer to sell,
pledge, mortgage, hypothecation, encumbrance, disposition of or any
other like transfer or encumbering of any Taylor Common Shares
and/or the Taylor Note (or any interest in the foregoing),
including any such transfer or encumbering by operation of law or
court order; provided that Proposed Transfer shall not
include any merger, consolidation or like transfer effected
pursuant to a vote of the holders of capital stock of the
Company.
(e)
“Proposed
Transfer Notice” means written notice from Taylor setting
forth the terms and conditions of a Proposed Transfer.
(f)
“Prospective
Transferee” means any person to whom a Proposed Transfer is
proposed to be made.
(g)
“Secondary
Notice” means written notice from the Company notifying GCP
and Monster Worldwide that the Company does not intend to exercise
its right of first refusal as to all shares of Transfer Stock with
respect to any Proposed Transfer.
(h)
“Secondary
Refusal Right” means the right, but not an obligation, of GCP
or Monster Worldwide to purchase up to its pro rata portion (based
upon their respective relative aggregate amounts invested in the
Company in connection with the July 2005 Financing) of any Transfer
Stock not purchased pursuant to the Company’s right of first
refusal set forth in Section 2(a), on the terms and conditions
specified in the Proposed Transfer Notice.
(i)
“Taylor
Common Shares” means any shares of the Company’s Common
Stock issued to Taylor and outstanding on the date hereof, and any
securities of the Company issued in respect thereof.
(j)
“Taylor
Note” means the Note issued to Taylor pursuant to the terms
of the Subscription Agreement between the Company and Taylor, dated
as of the date hereof.
(k)
“Taylor
Note Refusal Right” means the right, but not an obligation,
of GCP or Monster Worldwide to purchase up to its pro rata portion
(based upon their respective relative aggregate amounts invested in
connection with the July 2005 Financing) of all or any portion of
the Taylor Note that is proposed to be transferred in a Proposed
Transfer, on the terms and conditions specified in a notice
relating to such proposed transfer.
(l)
“Transfer
Stock” means Taylor Common Shares that is proposed to be
transferred in a Proposed Transfer.
2.
Right of First Refusal
.
(a)
Company Right
to Purchase .
(1)
Grant . For so long as at
least one half of the original principal balance of the Monster
Note remains outstanding, Taylor hereby unconditionally and
irrevocably grants to the Company a right of first refusal to
purchase all or any portion of the Transfer Stock that Taylor may
propose to transfer in a Proposed Transfer, at the same price and
on the same terms and conditions as those offered to the
Prospective Transferee.
(2)
Notice
. Taylor
must deliver a Proposed Transfer Notice to the Company and each of
GCP and Monster Worldwide not later than thirty (30) days prior to
the consummation of such Proposed Transfer. Such Proposed
Transfer Notice shall contain the material terms and conditions of
the Proposed Transfer and the identity of the Prospective
Transferee. The Company must exercise its right of first
refusal under Section 2(a) by giving a Company Notice to Taylor,
with copies to GCP and Monster Worldwide, within five (5) days
after delivery of the Proposed Transfer Notice. The Company
shall not exercise its right of first refusal hereunder with
respect to any Proposed Transfer, without the prior approval of a
majority of its Board of Directors, which majority shall include
the director designated by GCP, if any.
2
(b)
GCP and
Monster Worldwide Right to Purchase .
(1)
Grant . For so long as at
least one half of the original principal balance of the Monster
Note remains outstanding, Taylor hereby unconditionally and
irrevocably grants to GCP and Monster Worldwide a Secondary Refusal
Right to purchase all or any portion of the Transfer Stock not
purchased by the Company pursuant to the Company’s right of
first refusal set forth above, as provided in this Section
2(b). If the Company does not intend to exercise its right of
first refusal with respect to all Transfer Stock subject to a
Proposed Transfer, the Company must deliver a Secondary Notice to
GCP and Monster Worldwide no later than ten (10) days after Taylor
delivers the Proposed Transfer Notice to the Company. To
exercise its rights under this Section 2(b), GCP or Monster
Worldwide must deliver an Investor Notice to Taylor and the Company
within ten (10) days after the receipt of the Secondary Notice. In
addition, in the event Taylor proposes to transfer the Taylor Note
in a Proposed Transfer, for so long as at least one half of the
original principal balance of the Monster Note remains outstanding,
Taylor hereby unconditionally and irrevocably grants to GCP and
Monster Worldwide a Taylor Note Refusal Right to purchase all or
any portion of the Taylor Note that is proposed to be transferred
at the same price and on the same terms and conditions as those
offered to the transferee to whom the Taylor Note is proposed to be
transferred. Taylor must deliver a notice to GCP and Monster
Worldwide no later than twenty (20) days prior to the consummation
of such proposed transfer of the Taylor Note. To exercise its
Taylor Note Refusal Rights, GCP or Monster Worldwide must deliver a
notice to Taylor and the Company within ten (10) days after receipt
of the notice referred to in the preceding sentence indicating that
such Investor intends to exercise its Taylor Note Refusal
Right.
(c)
Consideration;
Closing . If the consideration
proposed to be paid for the Transfer Stock or the Taylor Note is in
property, services or other non-cash consideration, the fair market
value of the consideration shall be determined in good faith by a
majority of the Company’s Board of Directors (the
“Board”), which majority shall include the director
designated by GCP, if any. If the Company or GCP or Monster
Worldwide cannot for any reason pay for the Transfer Stock in the
same form of non-cash consideration, the Company or such Investor
may pay the cash value equivalent thereof, as determined by the
Board, as provided above. The closing of the purchase of
Transfer Stock by the Company and GCP or Monster Worldwide or the
Taylor Note by GCP or Monster Worldwide shall take place, and all
payments from the Company and GCP or Monster Worldwide shall have
been delivered to Taylor, by the later of (i) the date specified in
the applicable notice referred to above as the intended date of the
Proposed Transfer or the date of the transfer of the Taylor Note,
as the case may be and (ii) thirty (30) days after delivery of such
applicable notice.
(d)
Effect of
Failure to Comply . Any transfer not made
in compliance with the requirements of this Agreement shall be null
and void ab initio, shall not be recorded on the books of the
Company or its transfer agent and shall not be recognized by the
Company. Each party hereto acknowledges and agrees that any
breach of this Agreement would result in substantial harm to the
other parties hereto for which monetary damages alone could not
adequately compensate. Therefore, the parties hereto
unconditionally and irrevocably agree that any non-breaching party
hereto shall be entitled to seek protective orders, injunctive
relief and other remedies available at law or in equity (including,
without limitation, seeking specific performance or the rescission
of p
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