SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
SCHEDULE 13D/A
INFORMATION TO BE INCLUDED IN
STATEMENTS FILED PURSUANT TO RULE 13d-1(a) AND
AMENDMENTS THERETO FILED PURSUANT TO RULE 13d-2(a)
(Amendment No. 3)
TIVO INC.
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(Name of Issuer)
Common Stock, par value $0.001 per share
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(Title of Class of Securities)
888706108
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(CUSIP Number)
Paul T. Cappuccio, Esq.
Executive Vice President and General Counsel
AOL Time Warner Inc.
75 Rockefeller Plaza
New York, New York 10019
(212) 484-8000
Copy to:
David J. Sorkin, Esq.
Simpson Thacher & Bartlett
425 Lexington Avenue
New York, New York 10017
(212) 455-2000
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(Name, Address and Telephone Number of Person
Authorized to Receive Notices and Communications)
January 30, 2001
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(Date of Event which Requires Filing of this Statement)
If the filing person has previously filed a statement on Schedule 13G to
report the acquisition which is the subject of this Schedule 13D, and is
filing this Schedule because of Rule 13d-1(e), Rule 13d-1(f) or Rule 13d-
1(g), check the following box / /.
CUSIP No. 888 706108 Page 2 of 51
AOL Time Warner Inc., a Delaware corporation ("AOL Time Warner"),
and its wholly owned subsidiary, America Online, Inc., a Delaware corporation
("America Online") (collectively, the "Reporting Persons"), hereby file this
Amendment No. 3 ("Amendment No. 3") to amend and supplement the Statement on
Schedule 13D originally filed on June 23, 2000, previously amended and
supplemented by Amendment No. 1 filed on September 22, 2000 and Amendment No.
2 filed on January 23, 2001 (collectively, the "Statement"), with respect to
the common stock, par value $0.001 per share ("TiVo Common Stock"), of TiVo
Inc., a Delaware corporation ("TiVo"). Capitalized terms used but not
defined in this Amendment No. 3 have the meanings assigned thereto in the
Statement. The Statement is hereby amended and supplemented by this
Amendment No. 3.
Item 2. Identity and Background.
The response to Item 2 of the Statement is hereby amended by
deleting paragraph six thereof in its entirety.
Item 5. Interest in Securities of TiVo.
The response to Item 5 of the Statement is hereby amended and
supplemented by inserting immediately after paragraph five thereof the
following new paragraphs six, seven and eight:
"On January 30, 2001, America Online and TiVo entered into a Second
Amendment to the Investment Agreement (the "Second Amendment"). Pursuant to
the Second Amendment, (i) the Warrant to purchase 2,308,475 Warrant Shares
that was issued in the form of warrant attached as Exhibit D to the
Investment Agreement and (ii) the Warrant to purchase 295,428 Warrant Shares
that was issued in the form of warrant attached as Exhibit E to the
Investment Agreement were each amended and restated to reduce the exercise
price of each Warrant to $7.29 (the "Amended Warrants"). The Amended
Warrants were issued in the forms of warrant attached as Exhibits B and C to
the Second Amendment, which is being filed as Exhibit 7 to the Statement.
Pursuant to the Investment Agreement, as amended, $91.5 million of the
proceeds of America Online's investment in TiVo had been deposited by TiVo
into an escrow account for use in accordance with the Product Integration and
Marketing Agreement, dated as of June 9, 2000, by and between America Online
and TiVo (the "Commercial Agreement"). In consideration for the repricing of
the warrants described above, America Online consented to the release from
escrow to TiVo of $43.5 million.
On August 17, 2000, TiVo appointed Mr. Barry Schuler, Chairman of the
Board and Chief Executive Officer of America Online, as a director of TiVo and,
in connection therewith, granted him options (the "Options")to purchase 20,000
shares of TiVo Common Stock with an exercise price of $18.3125 per share. The
Options become exercisable in twenty-four equal installments on each monthly
CUSIP No. 888 706108 Page 3 of 51
anniversary of the grant date for twenty-four months, beginning on
September 17, 2000. Mr. Schuler intends to transfer the
legal or beneficial ownership of the Options to America Online."
Item 6. Contracts, Arrangements, Understandings or Relationships with
Respect to Securities of TiVo.
The response to Item 6 of the Statement is hereby amended and
supplemented by inserting new paragraphs one and two to read in their
entirety as follows:
"The Investment Agreement, as amended, provides that if (i)(a) the
bona fide commercial release and deployment of hardware for an integrated
AOL/TiVo television service (the "Set Top Box Launch") has not occurred by
December 31, 2001, or another mutually agreeable date, and (b) America Online
has not committed an uncured breach of the Commercial Agreement, or (ii) TiVo
breaches certain of its financial covenants set forth in the Investment
Agreement, America Online shall have the right, exercisable for a period of
90 days, to require TiVo to repurchase a number of Preferred Shares having an
initial liquidation equal to the amount of funds held in escrow (excluding
any interest earned on such funds). If the aggregate initial liquidation
value of the Preferred Shares is less than such amount of escrowed funds,
America Online has the right to require TiVo to repurchase shares of its
Common Stock in an amount equal to the difference between the aggregate
initial liquidation value of the Preferred Shares and the amount of escrowed
funds. The aggregate purchase price for the repurchase of shares described
above shall be deemed paid by the release to America Online of all of the
escrowed funds (including all interest included in the escrowed funds);
provided that the amount of interest earned on funds deposited into the
escrow account to be released to America Online shall be reduced by the
amount of dividends actually paid in cash to America Online on the preferred
shares, subject to a maximum equal to the amount of all such interest. If
the Set Top Box Launch occurs prior to December 31, 2001, all of the funds
held in escrow shall be released to TiVo.
On August 17, 2000, Mr. Barry Schuler received the Options to
purchase 20,000 shares of TiVo Common Stock for an exercise price of $18.3125
per share. The Options become exercisable in twenty-four equal installments
on each monthly anniversary of the grant date for twenty-four months,
beginning on September 17, 2000."
Item 7. Material to Be Filed as Exhibit.
The response to Item 7 of the Statement is hereby amended and
supplemented to include Exhibit 5 as follows:
Exhibit Number Description
5 Second Amendment to the Investment Agreement,
dated as of January 30, 2001, made by and
between TiVo and America Online
CUSIP No. 888 706108 Page 4 of 51
SIGNATURE
After reasonable inquiry and to the best of my knowledge and
belief, I certify that the information set forth in this statement is true,
complete and correct.
AOL TIME WARNER INC.
By: /s/ J. Michael Kelly
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Name: J. Michael Kelly
Title: Executive Vice President and
Chief Financial Officer
AMERICA ONLINE, INC.
By: /s/ Randall J. Boe
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Name: Randall J. Boe
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Title: Senior Vice President,
General Counsel and
Secretary
Dated: February 9, 2001
CUSIP No. 888 706108 Page 5 of 51
EXHIBIT 7
SECOND AMENDMENT TO
INVESTMENT AGREEMENT
This Second Amendment, dated as of January 30, 2001 (this "Second
Amendment"), to the Investment Agreement, dated as of June 9, 2000, as
amended by the First Amendment, dated as of September 11, 2000 (together, the
"Investment Agreement"), is made by and between TiVo Inc., a Delaware
corporation (the "Company"), and America Online, Inc., a Delaware corporation
(the "Purchaser"). Capitalized terms used but not defined herein shall have
the meanings assigned to them in the Investment Agreement.
W I T N E S S E T H:
WHEREAS, Section 7.8 of the Investment Agreement provides for the
amendment of the Investment Agreement upon the written consent of the Company
and the Purchaser;
WHEREAS, Section 1.4 of the Investment Agreement provides for a
certain portion of the Escrowed Funds to be designated as Earmarked Funds to
be used exclusively in accordance with Section 8.2 of the Product Integration
and Marketing Agreement (the "Commercial Agreement");
WHEREAS, the Purchaser has agreed to release a certain portion of the
Escrowed Funds to the Company upon terms and conditions agreed to by the
Purchaser and the Company;
WHEREAS, the Company has issued Warrants pursuant to Section 1.3 of
the Investment Agreement and, in connection with the release of Escrowed
Funds, the Company and the Purchaser have agreed to amend certain provisions
of certain of the outstanding Warrants;
WHEREAS, the Company and the Purchaser desire to amend certain provisions of
the Investment Agreement;
NOW THEREFORE, the parties hereto agree as follows:
I. Amendment to Section 1.4. Section 1.4 of the Investment
Agreement is hereby amended by deleting such section in its entirety and
substituting therefor the following:
"(a) The Company has deposited ninety-one million, five hundred
thousand dollars ($91,500,000) of the proceeds received by the Company
in the Share Purchase into an interest-bearing escrow account (the
"Escrow Account") pursuant to the Escrow Agreement, dated as of September
11, 2000 (the "Escrow Agreement"), by and among U.S. Trust
CUSIP No. 888 706108 Page 6 of 51
Company, National Association (the "Escrow Agent"), the Purchaser and
the Company. The Purchaser and the Company shall direct the Escrow
Agent to release to the Company from the Escrow Account funds in an
aggregate amount of forty-three million, five hundred thousand dollars
($43,500,000). All amounts remaining in the Escrow Account after such
release, together with all interest earned on any amounts held in the
Escrow Account (all such funds and interest, the "Escrowed Funds"),
shall be held as a trust fund and not subject to any lien, attachment,
trustee process or any other judicial process of any creditor of any
party, and shall be held and distributed in accordance with the terms
hereof and the Escrow Agreement.
Upon release to the Company in accordance with Section 1.4(b) and the
terms of the Escrow Agreement, forty-eight million dollars ($48,000,000)
of the Escrowed Funds shall be designated as "Earmarked Funds" and used
exclusively in accordance with Section 8.2 of the Commercial Agreement,
and any additional Escrowed Funds shall be released to the Company and may
be used by the Company for any purpose whatsoever. At any time that this
Agreement provides for the Escrowed Funds to be released from the Escrow
Account, both parties agree to take any action required under the Escrow
Agreement to cause the release of the Escrowed Funds.
(b) If (i)(x) the bona fide commercial release and deployment
("Set Top Box Launch") of the Integrated Product (as defined in the
Commercial Agreement) has not occurred by December 31, 2001, or such
later date as may be mutually agreed by the Company and the Purchaser
pursuant to Section 3.6 of the Commercial Agreement or otherwise (the
"Planned Launch Date"), and (y) the Purchaser has not committed a
Material Breach (as defined in the Commercial Agreement) of the
Commercial Agreement that has not been cured or waived at such time, or
(ii) the Company breaches its obligations pursuant to Section 6.9,
Section 6.10 or Section 6.13 of this Agreement (collectively, the
"Financial Covenants"), then the Purchaser shall have the option (the
"Put Option"), exercisable for a period of ninety (90) days following
the Planned Launch Date or each such breach, as the case may be, subject
to the further provisions set forth herein, to require the Company,
exercisable by written notice to such effect to the Company, to
repurchase that number of Preferred Shares having an initial liquidation
value equal to the amount of the Escrowed Funds at such time (excluding
any interest included therein) (the "Put Amount") and, if all the
Preferred Shares then outstanding have an aggregate initial liquidation
value of less than the Put Amount, then the Purchaser may also require
the Company to repurchase a number of shares of Common Stock held by the
Purchaser having a value (calculated as the product of the number of
shares of Common Stock and the Common Stock Price paid by the Purchaser)
equal to the difference between the aggregate initial liquidation value
of the Preferred Shares, if any, and the Put Amount. The aggregate
purchase price for the repurchase of Shares pursuant to this Section
1.4(b) shall be deemed paid by the release to the Purchaser of all the
Escrowed Funds (including all interest included therein); provided that
the amount of the interest earned on funds deposited into the Escrow
Account to be released to the Purchaser shall be reduced by the amount
of dividends actually paid in cash to the Purchaser on the Preferred
Shares, subject to a maximum equal to the amount of all such interest.
Notwithstanding the foregoing, in the event that the Set Top Box Launch
occurs
CUSIP No. 888 706108 Page 7 of 51
after the Planned Launch Date, but prior to the exercise of the
Put Option, the Put Option under clause (i) above shall immediately
expire and be of no further force of effect.
In the event that the Put Option is exercised in accordance with
the terms of this Section 1.4(b), the closing of such repurchase shall
occur as soon as practicable following delivery of the Purchaser's notice
of exercise, subject to the receipt of necessary governmental approvals.
The Company agrees to use its best efforts to obtain all such governmental
approvals and take all such other actions as shall be required to
consummate such repurchase. At such closing, the Purchaser shall deliver
to the Company certificates representing the Shares to be repurchased and
the Company shall deliver to the Purchaser and the Escrow Agent under the
Escrow Agreement any notice of release or other instrument reasonably
requested by either of them to effectuate the release of the Escrowed
Funds (including all interest earned thereon, subject to the proviso in
the second sentence of this Section 1.4(b)) in accordance with the terms
of the Escrow Agreement and this Section 1.4(b). It is agreed that, in
the event the Purchaser is entitled to exercise the Put Option pursuant to
clause (ii) of the first sentence of this Section 1.4(b), such exercise
shall be in addition to and without limiting any other remedy or right,
whether at law or equity, that the Purchaser may have as a result of the
breach of a Financial Covenant.
(c) If the Set Top Box Launch occurs prior to December 31, 2001,
the Company shall be entitled to receive from the escrow under the
Escrow Agreement all Escrowed Funds. Forty-eight million dollars
($48,000,000) of the Escrowed Funds released to the Company shall be
designated as Earmarked Funds and used exclusively in accordance with
Section 8.2 of the Commercial Agreement and any additional Escrowed
Funds shall be released to the Company and may be used by the Company
for any purpose whatsoever.
2. Agreement to Amend the Escrow Agreement. In order to
effectuate the foregoing, the Company and the Purchaser hereby agree to
execute and deliver an amendment to the Escrow Agreement in the form of
Exhibit A hereto (the "Escrow Agreement Amendment"), with such changes and
additions as shall be requested by the Escrow Agent and reasonably acceptable
to the Company and the Purchaser.
3. Amendment to the Warrants. In consideration for the release
of the Escrowed Funds in accordance herewith and the other amendments
effectuated hereby, the Company hereby agrees that it shall amend (i) the
TiVo Inc. Stock Subscription Warrant No. VW-A-1, dated September 13, 2000,
issued to the Purchaser (the "VW-A-1 Warrant") and (ii) the TiVo Inc. Stock
Subscription Warrant No. VW-B-1, dated September 13, 2000, issued to the
Purchaser (the "VW-B-1 Warrant" and, together with the VW-A-1 Warrant, the
"VW Warrants"), to reflect certain changes in the exercise price of each VW
Warrant as set forth below. The Company shall deliver to the Purchaser an
amended and restated form of each warrant against delivery for cancellation
of each warrant amended hereby (the "Amended Warrants"). The Amended
Warrants shall be in the forms of Exhibits B and C hereto. The Purchaser
shall not be obligated to pay any additional consideration for the delivery
of the Amended Warrants.
CUSIP No. 888 706108 Page 8 of 51
(a) The TiVo Inc. Stock Subscription Warrant No. VW-A-1, dated
September 13, 2000, issued to the Purchaser is hereby amended by (i) deleting
from the first paragraph thereof the words "at a price per share (the
"Warrant Price") of $23.10625" and (ii) substituting in lieu thereof "at a
price per share (the "Warrant Price") of $7.29."
(b) The TiVo Inc. Stock Subscription Warrant No. VW-B-1, dated
September 13, 2000, issued to the Purchaser is hereby amended by (i) deleting
from the first paragraph thereof the words "at a price per share (the "Warrant
Price") of $30.00" and (ii) substituting in lieu thereof "at a price per
share (the "Warrant Price") of $7.29."
4. Representations and Warranties of the Company.
(a) Organization Good Standing and Qualification. The Company is
a corporation duly organized, validly existing and in good standing under the
laws of the State of Delaware. The Company has all requisite corporate power
and authority to execute and deliver this Second Amendment and the Escrow
Agreement Amendment and the Amended Warrants (collectively, the "Related
Agreements"), to carry out the provisions of this Second Amendment and the
Related Agreements, and to carry on its business as presently conducted and
as presently proposed to be conducted. The Company is duly qualified and is
authorized to do business and is in good standing as a foreign corporation in
all jurisdictions in which the nature of its activities and of its properties
(both owned and leased) makes such qualification necessary, except for those
jurisdictions in which failure to do so could not reasonably be expected,
individually or in the aggregate, to have a material adverse effect on the
Company or its business, assets, financial condition, prospects, liabilities
or results of operations (a "Material Adverse Effect").
(b) Authorization; Binding Obligations.
(i) All corporate action on the part of the Company, its officers,
directors and shareholders necessary for the authorization, execution and
delivery of this Second Amendment and the Related Agreements and the
performance of all obligations of the Company hereunder and thereunder has
been taken. Each of this Second Amendment and the Related Agreements are
valid and binding obligations of the Company enforceable in accordance with
their terms, except (1) as limited by applicable bankruptcy, insolvency,
reorganization, moratorium or other laws of general application affecting
enforcement of creditors' rights and (2) general principles of equity that
restrict the availability of equitable remedies. The subsequent exercise of
the Amended Warrants and the issuance of shares of Common Stock upon exercise
thereof (the "Warrant Shares") are not and will not be subject to any
preemptive rights or rights of first refusal.
(ii) Other than filings which may be necessary pursuant to the
Securities Act of 1933, as amended (the "Securities Act"), the Securities
Exchange Act of 1934, as amended (the "Exchange Act"), no notice to, filing
with, exemption or review by, or authorization, consent or approval of, any
public body or authority is necessary for the consummation by the Company of
the transactions contemplated by this Second Amendment.
(c) Compliance with Other Instruments. The Company is not in
violation or default under (i) any term of its Restated Certificate or
Bylaws, (ii) any law, ordinance, statute,
CUSIP No. 888 706108 Page 9 of 51
rule or regulation or court order, judgment or decree or (iii) any provision of
any mortgage, indenture, contract, agreement, instrument or contract to which
it is party or by which it is bound or of any judgment, decree, order, writ or
any statute, rule or regulation applicable to the Company which in the case of
clause (iii) could reasonably be expected to, individually or in the aggregate,
have a Material Adverse Effect or which could have a Material Adverse Effect,
or which might materially and adversely affect the consummation of the
transactions contemplated by this Second Amendment or the Related Agreements.
The execution, delivery, and performance of and compliance with this Second
Amendment and the Related Agreements, and the issuance of the Warrant Shares
pursuant to the Amended Warrants will not result in any such violation or
default under clauses (i), (ii) or (iii) of the foregoing sentence, or result
in the creation of any mortgage, pledge, lien, encumbrance or charge upon any
of the properties or assets of the Company or the suspension, revocation,
impairment, forfeiture or nonrenewal of any permit, license, authorization or
approval applicable to the Company, its business or operations or any of its
assets or properties.
(d) Absence of Certain Changes. Since September 30, 2000, (i) no
event, change or circumstance has occurred which would have, or could
reasonably be expected to have, individually or in the aggregate, a Material
Adverse Effect, and (ii) the Company has carried on its business in the
ordinary course consistent with past practices.
5. Representations and Warranties of the Purchaser.
(a) Organization Good Standing and Qualification. The Purchaser
is a corporation duly organized, validly existing and in good standing under
the laws of the State of Delaware. The Purchaser has all requisite corporate
power and authority to execute and deliver this Second Amendment and the
Related Agreements and to carry out the provisions of this Second Amendment
and the Related Agreements.
(b) Authorization; Binding Obligations. (i) All corporate action
on the part of the Purchaser, its officers, directors and shareholders
necessary for the authorization, execution and delivery of this Second
Amendment and the Related Agreements and the performance of all obligations
of the Purchaser hereunder and thereunder has been taken. Each of this
Second Amendment and the Related Agreements are valid and binding obligations
of the Purchaser enforceable in accordance with their terms, except (1) as
limited by applicable bankruptcy, insolvency, reorganization, moratorium or
other laws of general application affecting enforcement of creditors' rights
and (2) general principles of equity that restrict the availability of
equitable remedies.
(c) Investment Representations. The Purchaser understands that
neither the Amended Warrants nor the Warrant Shares have been registered
under the Securities Act. The Purchaser hereby represents and warrants as
follows as of the date hereof and, for purposes of paragraphs (iii) and (v)
below, as of the date of any exercise of the Amended Warrants:
(i) Purchaser Bears Economic Risk. The Purchaser is capable
of evaluating the merits and risks of its investment in the Company and by
reason of its, or of its management's, business or financial experience, the
Purchaser has the capacity to protect its own interests in connection with
such investment and the Amended Warrants and exercise of the
CUSIP No. 888 706108 Page 10 of 51
Amended Warrants. The Purchaser must bear the economic risk of its investment
in the Company indefinitely unless the Warrant Shares are registered pursuant
to the Securities Act, or an exemption from registration is available. The
Purchaser also understands that there is no assurance that any exemption from
registration under the Securities Act will be available and that, even if
available, such exemption may not allow the Purchaser to transfer all or any
portion of the Amended Warrants or the Warrant Shares under the
circumstances, in the amounts or at the times the Purchaser might propose.
(ii) Acquisition for Own Account. The Purchaser has acquired
the Amended Warrants, and will acquire the Warrant Shares, if any, for the
Purchaser's own account and for investment only, and not with a view towards
their distribution.
(iii) Accredited Investor. The Purchaser is an accredited
investor within the meaning of Regulation D under the Securities Act.
(iv) Company Information. The Purchaser has had an
opportunity to discuss the Company's business, management and financial
affairs with directors, officers and management of the Company. The
Purchaser has also had the opportunity to ask questions of and receive
answers from, the Company and its management regarding the terms and
conditions of this investment.
(v) Rule 144. The Purchaser acknowledges and agrees that the
Amended Warrants and, if issued, the Warrant Shares, must be held
indefinitely unless they are subsequently registered under the Securities Act
or an exemption from registration is available. The Purchaser has been
advised or is aware of the provisions of Rule 144 promulgated under the
Securities Act, which permits limited resale of shares purchased in a private
placement subject to the satisfaction of certain conditions, including, among
other things: the availability of certain current public information about
the Company, the resale occurring following the required holding period under
Rule 144 and the number of shares being sold during any three-month period
not exceeding specified limitations.
(vi) Address. The principal address of the Purchaser is 22000
AOL Way, Dulles, Virginia, 20166-9323.
6. Confidentiality. With respect to the first press release or
other public announcement by the Company (the "Initial Press Release") and
the first filing by the Company with the SEC (the "Initial SEC Release")
which, in each case, includes information or statements concerning this
Second Amendment, any of the Related Agreements or any other agreements
executed in connection herewith or therewith, or the matters contemplated
hereby or thereby, the Company shall use its reasonable best efforts to
cooperate with the Purchaser, furnish drafts of all such information or
statements to the Purchaser, and provide the Purchaser with, in the case of
the Initial Press Release, at least one hour and, in the case of the Initial
SEC Filing, at least 24 hours, within which to review and comment upon any
such information or statement. The Company shall reflect all reasonable
comments and requests of the Purchaser received by the Company within the
time set forth above in such information or statement prior to the release
thereof; provided that the Company shall be entitled to file this Second
Amendment, the Related Agreements and any other agreements executed in
connection herewith or therewith with the
CUSIP No. 888 706108 Page 11 of 51
SEC. The Company shall not release or permit the release of any such
information or statement unless it has first complied with the foregoing. In
the event the Company or any of its affiliates proposes to release any public
information or statement (including any SEC filings) with respect to this
Second Amendment, any of the Related Agreements or any other agreements
executed in connection herewith or therewith, or the matters contemplated
hereby or thereby which is materially different in substance, prominence or
context from the Initial Press Release or the Initial SEC Filings, then the
Company shall be required to provide the Purchaser with the 24-hour advance
notice and comment period in accordance with the foregoing prior to releasing
any such information or statement.
7. Counterparts. This Second Amendment may be executed
simultaneously or in any number of counterparts, each of which shall be
deemed to be an original, and all of which shall constitute one and the same
instrument.
8. Effective Date; No Other Amendments. Each of the parties
hereto agrees that the amendments to the Investment Agreement contained
herein shall be effective as of the date and year first above written upon
execution of this Second Amendment by each party hereto. Except as expressly
amended hereby, the provisions of the Investment Agreement are hereby
ratified and confirmed by the parties and shall remain in full force and
effect. All references in the Investment Agreement to "this Agreement" shall
be read as references to the Investment Agreement, as amended by the First
Amendment and this Second Amendment.
9. Construction and Governing Law. This Second Amendment shall be
construed together with, and as a part of, the Investment Agreement and shall
be governed in all respects by the laws of the State of New York as such laws
are applied to agreements to be performed entirely in such state.
* * *
CUSIP No. 888 706108 Page 12 of 51
IN WITNESS WHEREOF, each of the undersigned has executed this
Second Amendment dated as of the date first written above.
TIVO INC.
By: /s/ David H. Courtney
----------------------
Name: David H. Courtney
Title: Senior VP, Finance &
Administration
AMERICA ONLINE, INC.
By: /s/ Lynda Clarizio
------------------
Name: Lynda Clarizio
Title: Senior Vice President
CUSIP No. 888 706108 Page 13 of 51
Exhibit A
FIRST AMENDMENT TO ESCROW AGREEMENT
This FIRST AMENDMENT, dated as of January 30, 2001 (this "First
Amendment"), to the Escrow Agreement, dated as of September 11, 2000 (the
"Escrow Agreement"), is made by and between TIVO INC., a Delaware Corporation
(the "Company"), AMERICA ONLINE, INC., a Delaware corporation (the "Purchaser"),
and U.S. TRUST COMPANY, NATIONAL ASSOCIATION (the "Escrow Agent").
Capitalized terms used but not defined herein shall have the meanings
assigned to them in the Escrow Agreement.
W I T N E S S E T H:
WHEREAS, Section 8 of the Escrow Agreement provides for the
amendment of the Escrow Agreement upon the written consent of the Company,
the Purchaser and the Escrow Agent;
WHEREAS, the Purchaser and the Company are parties to the
Investment Agreement, dated as of June 9, 2000, as amended by the First
Amendment, dated as of September 11, 2000, and as amended by the Second
Amendment, dated as of January 30, 2001 (as so amended, the "Investment
Agreement");
WHEREAS, pursuant to the Second Amendment to the Investment
Agreement, the Purchaser and the Company have agreed to direct the Escrow
Agent to release certain Escrowed Funds to the Company;
WHEREAS, the Company, the Purchaser and the Escrow Agent desire to amend
certain provisions of the Escrow Agreement;
NOW, THEREFORE, the parties hereto agree as follows:
1. Amendment to Section 3. Section 3 of the Escrow Agreement is hereby
amended by inserting the following new paragraph (c):
"(c) Release of Escrowed Funds at the Direction of the Company and
the Purchaser. All of the Escrowed Funds, or any portion thereof, shall
be released by the Escrow Agent to the Company, the Purchaser or a third
party, by wire transfer of immediately available funds to such account
as the Company and the Purchaser shall designate in writing, upon
receipt by the Escrow Agent of written instructions ("Joint Release
Instructions") signed by both the Company and the Purchaser that (i)
certify that both the Company and the Purchaser agree upon the release
of the Escrowed Funds to the account designated, (ii) specify the amount
of the Escrowed Funds to be released and (iii)
CUSIP No. 888 706108 Page 14 of 51
specify the account information of the account to which the Escrowed Funds
shall be transferred."
2. Agreement to Release Escrowed Funds. Pursuant to the Joint Release
Instructions attached as Annex A hereto, the Purchaser and the Company hereby
direct the Escrow Agent to release Escrowed Funds in the amount of forty-
three million, five hundred thousand dollars ($43,500,000) to the Company.
3. Governing Law. This First Amendment shall be governed by and construed
in accordance with the laws of the State of New York applicable to agreements
made and to be performed entirely within such state.
4. Confidentiality. With respect to the first press release or other
public announcement by the Company (the "Initial Press Release") and the
first filing by the Company with the SEC (the "Initial SEC Release") which,
in each case, includes information or statements concerning this First
Amendment, any of the Related Agreements (as defined in the Second Amendment
to the Investment Agreement) or any other agreements executed in connection
herewith or therewith, or the matters contemplated hereby or thereby, the
Company shall use its reasonable best efforts to cooperate with the
Purchaser, furnish drafts of all such information or statements to the
Purchaser, and provide the Purchaser with, in the case of the Initial Press
Release, at least one hour and, in the case of the Initial SEC Filing, at
least 24 hours, within which to review and comment upon any such information
or statement. The Company shall reflect all reasonable comments and requests
of the Purchaser received by the Company within the time set forth above in
such information or statement prior to the release thereof; provided that the
Company shall be entitled to file the Second Amendment, the Related
Agreements and any other agreements executed in connection herewith or
therewith with the SEC. The Company shall not release or permit the release
of any such information or statement unless it has first complied with the
foregoing. In the event the Company or any of its affiliates proposes to
release any public information or statement (including any SEC filings) with
respect to this First Amendment, any of the Related Agreements or any other
agreements executed in connection herewith or therewith, or the matters
contemplated hereby or thereby which is materially different in substance,
prominence or context from the Initial Press Release or the Initial SEC
Filings, then the Company shall be required to provide the Purchaser with the
24-hour advance notice and comment period in accordance with the foregoing
prior to releasing any such information or statement.
5. Counterparts. This First Amendment 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.
6. Effective Date; No Other Amendments. Each of the parties hereto agrees
that the amendments to the Escrow Agreement contained herein shall be
effective as of the date and year first above written upon execution of this
First Amendment by each party hereto. Except as expressly amended hereby,
the provisions of the Escrow Agreement are hereby ratified and confirmed by
the parties and shall remain in full force and effect. All references in the
Escrow Agreement to "this Agreement" shall be read as references to the
Escrow Agreement, as amended by this First Amendment.
CUSIP No. 888 706108 Page 15 of 51
IN WITNESS WHEREOF, each of the parties has caused this First
Amendment to be executed by a duly authorized officer as of the day and year
first written above.
AMERICA ONLINE, INC.
By: /s/ Lynda Clarizio
-------------------
Name: Lynda Clarizio
Title: Senior Vice
TIVO INC.
By: /s/ David H. Courtney
---------------------
Name: David H. Courtney
Title: Senior VP, Finance &
Administration
U.S. TRUST COMPANY, NATIONAL
ASSOCIATION
By: /s/ Lawrence E. Gerquest
------------------------
Name: Lawrence E. Gerquest
Title: Assistant Vice President
CUSIP No. 888 706108 Page 16 of 51
Annex I
JOINT RELEASE INSTRUCTIONS
JOINT RELEASE INSTRUCTIONS, dated ______, made by TIVO INC. (the
"Company") and AMERICA ONLINE, INC. (the "Purchaser") pursuant to the Escrow
Agreement, dated as of September 11, 2000, as amended by the First Amendment,
dated as of January 30, 2001 (the "Escrow Agreement"). Capitalized terms used
but not defined herein shall have the meanings given them in the Escrow
Agreement.
1. The Company and the Purchaser agree that Escrowed Funds in an
aggregate amount of ___________________ shall be released as set forth herein.
2. The Escrow Agent is hereby directed to release _____________ to
the following account of ____________________:
[Account Information]
3. The Escrow Agent is hereby directed to release _____________ to
the following account of ____________________:
[Account Information]
AMERICA ONLINE, INC.
By: _____________________________
Name:
Title:
TIVO INC.
By: _____________________________
Name:
Title:
CUSIP No. 888 706108 Page 17 of 51
Exhibit B
THE SECURITIES REPRESENTED BY THIS CERTIFICATE HAVE BEEN ACQUIRED FOR
INVESTMENT AND HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS
AMENDED. THESE SECURITIES MAY NOT BE SOLD, OFFERED FOR SALE, PLEDGED OR
HYPOTHECATED IN THE ABSENCE OF AN EFFECTIVE REGISTRATION STATEMENT AS TO THE
SECURITIES UNDER SAID ACT OR LAWS OR AN OPINION OF COUNSEL SATISFACTORY TO
THE COMPANY THAT SUCH REGISTRATION IS NOT REQUIRED.
TIVO INC.
AMENDED AND RESTATED
STOCK SUBSCRIPTION WARRANT
No. VW - A - 1 September 13, 2000
1. General.
(a) THIS CERTIFIES that, for value received, AMERICA
ONLINE, INC. ("AOL"), or its assigns, is entitled to subscribe for and
purchase from TIVO INC., a Delaware corporation (the "Company"), at any time
or from time to time during the period (the "Exercise Period") commencing
with the date hereof and ending on December 31, 2001, on the terms and
subject to the provisions hereinafter set forth, up to 2,308,475 shares
(subject to adjustment as provided herein) of fully paid and non-assessable
shares of Common Stock, $0.001 par value (the "Common Stock"), of the
Company, at a price per share (the "Warrant Price") of $7.29.
(b) This Amended and Restated Warrant (this "Warrant")
amends and restates in its entirety the TiVo Inc. Stock Subscription Warrant
No. VW-A-1, dated September 13, 2000, issued to the Purchaser by the Company.
This Warrant is being issued pursuant to an Investment Agreement dated as of
June 9, 2000, as amended by the First Amendment, dated as of September 13,
2000, and as amended by the Second Amendment, dated as of January 30, 2001
(collectively, the "Agreement"), between the Company and AOL. All terms used
but not defined herein shall have the meanings set forth in the Agreement.
The shares of capital stock of the Company issuable upon exercise of this
Warrant are sometimes hereinafter referred to as the "Warrant Shares."
CUSIP No. 888 706108 Page 18 of 51
2. Exercise of Warrant.
(a) The rights represented by this Warrant may be
exercised by the holder hereof, in whole or in part, at any time or from time
to time during the Exercise Period, by (i) the surrender of this Warrant,
together with an executed Notice of Exercise in substantially the form
attached hereto as Exhibit A, at the office of the Company at 2160 Gold
Street, Alviso, CA 95002, or at such other agency or office of the Company in
the United States of America as it may designate by notice in writing to the
holder hereof at the address of such holder appearing on the books of the
Company, and (ii) payment (either in cash or by check) to the Company of the
Warrant Price for each Warrant Share being purchased. In the event of the
exercise of the rights represented by this Warrant, a certificate or
certificates for the Warrant Shares so purchased, registered in the name of
the holder, and if this Warrant shall not have been exercised for all of the
Warrant Shares, a new Warrant, registered in the name of the holder hereof,
of like tenor to this Warrant and representing the remaining Warrant Shares,
shall be delivered to the holder hereof within a reasonable time, not
exceeding ten (10) days, after the rights represented by this Warrant shall
have been so exercised. The person in whose name any certificate for Warrant
Shares is issued upon exercise of this Warrant shall for all purposes be
deemed to have become the holder of record of such shares on the date on
which the Warrant was surrendered and payment of the Warrant Price and any
applicable taxes was made, irrespective of the date of delivery of such
certificate, except that, if the date of such surrender and payment is a date
when the stock transfer books of the Company are closed, such person shall be
deemed to have become the holder of such shares at the close of business on
the next succeeding date on which the stock transfer books are open.
3. Adjustment of Warrant Price.
(a) The Warrant Price shall be subject to adjustment
from time to time as follows:
(i) If the number of shares of Common Stock
outstanding is increased by a stock dividend payable in shares of
Common Stock or by a subdivision or split-up of shares of Common
Stock, then, following the record date fixed for the determination of
holders of Common Stock entitled to receive such stock dividend,
subdivision or split-up, the Warrant Price shall be appropriately
decreased and the number of shares of Common Stock issuable upon
exercise of this Warrant shall be appropriately increased, in each
CUSIP No. 888 706108 Page 19 of 51
case in proportion to such increase in outstanding shares. Shares of
Common Stock owned by or held for the account of the Company shall
not be deemed outstanding for the purpose of any such computation.
Such adjustment shall be made successively whenever such a record
date is fixed; and in the event that such subdivision or split-up is
not effected, the Warrant Price shall again be adjusted to be the
Warrant Price which would then be in effect if such record date had
not been fixed.
(ii) If the number of shares of Common Stock
outstanding is decreased by a combination of the outstanding shares
of Common Stock, then, following the record date for such
combination, the Warrant Price shall be appropriately increased and
the number of shares of Common Stock issuable upon exercise of this
Warrant shall be appropriately decreased, in each case, in proportion
to such decrease in outstanding shares. Such adjustment shall be
made successively whenever such a record date is fixed; and in the
event that such combination is not effected, the Warrant Price shall
again be adjusted to be the Warrant Price which would then be in
effect if such record date had not been fixed.
(iii) In the event of any capital reorganization
of the Company, any reclassification of the stock of the Company
(other than a change in par value or from par value to no par value
or from no par value to par value or as a result of a stock dividend
or subdivision, split-up or combination of shares), or any
consolidation or merger of the Company (other than a consolidation or
merger in which the Company is the continuing corporation and which
does not result in any change in the Common Stock), this Warrant
shall after such reorganization, reclassification, consolidation or
merger be exercisable or exchangeable into the kind and number of
shares of stock or other securities or property of the Company or of
the corporation resulting from such consolidation or surviving such
merger to which the holder of the number of shares of Common Stock
deliverable (immediately prior to the time of such reorganization,
reclassification, consolidation or merger) upon exercise of this
Warrant would have been entitled upon such reorganization,
reclassification, consolidation or merger. The provisions of this
clause shall similarly apply to successive reorganizations,
reclassifications, consolidations or mergers.
CUSIP No. 888 706108 Page 20 of 51
(iv) In case the Company shall issue warrants or
other rights to all holders of Common Stock entitling them to
subscribe for or purchase shares of Common Stock at a price per share
less than the Fair Market Value of the Common Stock (as defined
below, with a Determination Date as of the record date for the
determination of stockholders entitled to receive such rights or
warrants, the Warrant Price in effect after such record date shall be
determined by multiplying such Warrant Price by a fraction, the
numerator of which shall be the number of shares of Common Stock
outstanding at the close of business on the record date for issuance
of such rights or warrants plus the number of shares of Common Stock
which the aggregate offering price of the total number of shares of
Common Stock so offered would purchase at such Fair Market Value, and
the denominator of which shall be the number of shares of Common
Stock outstanding at the close of business on the record date for
issuance of such rights or warrants plus the total number of shares
of Common Stock receivable upon exercise of such rights or warrants.
Such adjustment shall be made successively whenever any such rights
or warrants are issued, and shall become effective immediately after
such record date. In case such subscription price may be paid in a
consideration part or all of which shall be in a form other than
cash, the value of such consideration shall be as determined by a
nationally recognized independent investment banking firm jointly
selected by the Company and the holder of this Warrant or, if such
selection cannot be made within five (5) Business Days after the
record date referred to above, by a nationally recognized independent
investment banking firm selected by the American Arbitration
Association. Shares of Common Stock owned by or held for the account
of the Company shall not be deemed outstanding for the purpose of any
such computation. Such adjustment shall be made successively
whenever such a record date is fixed; and in the event that such
rights or warrants are not so issued, the Warrant Price shall again
be adjusted to be the Warrant Price which would then be in effect if
such record date had not been fixed. For purposes hereof:
"Fair Market Value" of one share of Common Stock as of any
date (the "Determination Date") means:
(A) (1) the average of the closing
prices quoted on Nasdaq, if applicable, or the average of
the last bid and asked prices of the Common Stock quoted in
the over-the-counter-market or (2) if the Common Stock is
CUSIP No. 888 706108 Page 21 of 51
then traded on a national securities exchange, the average
of the high and low prices of the Common Stock listed on the
principal national securities exchange on which the Common
Stock is so traded, in each case for the twenty (20) trading
days immediately preceding the Determination Date or, if
such date is not a business day on which shares are traded,
the next immediately preceding trading day; and
(B) in connection with a Corporate
Transaction (as hereinafter defined), the value per share of
Common Stock received or receivable by each holder thereof
(assuming for purposes of this determination, in the case of
a sale of assets, the Company is liquidated immediately
following such sale and the consideration paid to the
Company is immediately distributed to its stockholders); and
(C) in all other circumstances, the
fair market value per share of Common Stock as determined by
a nationally recognized independent investment banking firm
jointly selected by the Company and the holder of this
Warrant or, if such selection cannot be made within five (5)
Business Days after the Determination Date, by a nationally
recognized independent investment banking firm selected by
the American Arbitration Association; and
"Corporate Transaction" means (i) any consolidation or
merger of the Company with or into any other corporation or other entity,
other than any merger or consolidation resulting in the holders of the
capital stock of the Company entitled to vote for the election of directors
holding a majority of the capital stock of the surviving or resulting
corporation or its ultimate parent entity entitled to vote for the election
of directors, (ii) any person or entity (including any affiliates thereof)
becoming the holder of 50% of the capital stock of the Company entitled to
vote for the election of directors, or (iii) any sale or other disposition by
the Company of all or substantially all of its assets or capital stock.
(v) In case the Company shall distribute to all
holders of shares of Common Stock (including any such distribution
made in connection with a consolidation or merger in which the
Company is the continuing corporation) any shares of capital stock of
the Company (other than shares of Common Stock) or evidences of its
indebtedness or assets or rights or warrants to subscribe for or
CUSIP No. 888 706108 Page 22 of 51
purchase any of its securities (excluding those rights or warrants
referred to in subparagraph (iv) above) (any of the foregoing being
hereinafter in this subparagraph (v) called the "Securities"), then,
in each such case, the Warrant Price shall be adjusted so that the
same shall equal the price determined by multiplying the Warrant
Price in effect immediately prior to the date of such distribution by
a fraction the numerator of which shall be the Fair Market Value (as
defined above) of the Common Stock with a Determination Date as of
the record date mentioned above, less the then fair market value (as
determined by a nationally recognized independent investment banking
firm jointly selected by the Company and the holder of this Warrant
or, if such selection cannot be made within five (5) Business Days
after the record date referred to above, by a nationally recognized
independent investment banking firm selected by the American
Arbitration Association) of the portion of the Securities so
distributed allocable to one share of Common Stock, and the
denominator of which shall be the Fair Market Value of the Common
Stock. Such adjustment shall become effective immediately prior to
the opening of business on the day following the record date for the
determination of shareholders entitled to receive such distribution.
In the event that such distribution is not so made, the Warrant Price
shall again be adjusted to be the Warrant Price which would then be
in effect if such date fixed for the determination of shareholders
entitled to receive such distribution had not been fixed.
(vi) All calculations under this Section 3 shall
be made to the nearest one tenth (1/10) of a cent or to the nearest
one tenth (1/10) of a share, as the case may be.
(b) Whenever the Warrant Price shall be adjusted as
provided in this Section 3 the Company shall forthwith file, at the office of
the Company or any transfer agent designated by the Company for the Common
Stock, a statement, signed by its chief financial officer, showing in detail
the facts requiring such adjustment and the adjusted Warrant Price. The
Company shall also cause a copy of such statement to be sent by first-class
certified mail, return receipt requested, postage prepaid, to each holder of
a Warrant at his or its address appearing on the Company's records. Where
appropriate, such copy may be given in advance and may be included as part of
a notice required to be mailed under the provisions set forth immediately
below.
CUSIP No. 888 706108 Page 23 of 51
(c) In the event the Company shall propose to take any
action of the types described in Section 3(a) or Section 10, the Company
shall give notice to each holder of a Warrant in the manner set forth herein,
which notice shall specify the record date, if any, with respect to any such
action and the date on which such action is to take place. Such notice shall
also set forth such facts with respect thereto as shall be reasonably
necessary to indicate the effect of such action (to the extent such effect
may be known at the date of such notice) on the Warrant Price then in effect
and the number, kind or class of shares or other securities or property which
shall be delivered or purchasable upon the occurrence of such action or
deliverable upon exercise of this Warrant. In the case of any action which
would require the fixing of a record date, such notice shall be given at
least twenty (20) days prior to the date so fixed, and in case of all other
action, such notice shall be given at least thirty (30) days prior to the
taking of such proposed action. Failure to give such notice, or any defect
therein, shall not affect the legality or validity of any such action.
4. Adjustment of Warrant Shares.
Upon each adjustment of the Warrant Price as provided in
Section 3, the holder hereof shall thereafter be entitled to subscribe for
and purchase, at the Warrant Price resulting from such adjustment, the number
of Warrant Shares equal to the product of (i) the number of Warrant Shares
existing prior to such adjustment and (ii) the quotient obtained by dividing
(A) the Warrant Price existing prior to such adjustment by (B) the new
Warrant Price resulting from such adjustment. No fractional shares of Common
Stock shall be issued as a result of any such adjustment, and any fractional
shares resulting from the computations pursuant to this paragraph shall be
eliminated without consideration.
5. Covenants.
The Company covenants and agrees that:
(i) all shares of Common Stock and any other
securities which may be issued upon the exercise of the rights
represented by this Warrant will, upon issuance, be validly issued,
fully paid and non-assessable and free from all taxes, liens and
charges with respect to the issuance thereof;
(ii) the Company will from time to time take all
such action as may be requisite to assure that the stated or par
CUSIP No. 888 706108 Page 24 of 51
value per share of the Common Stock is at all times equal to or less
than the then effective Warrant Price per share of Preferred Stock
issuable upon exercise of this Warrant;
(iii) the Company will at all times have
authorized and reserved, free from preemptive rights, a sufficient
number of shares of its Common Stock and any other securities to
provide for the exercise of the rights represented by this Warrant;
(iv) if any shares of Common Stock or any other
securities to be reserved to provide for the exercise of this Warrant
require registration with or approval of any Governmental Authority
under any Federal or state law before such shares may be validly
issued or delivered upon exercise, then the Company will in good
faith and expeditiously as possible endeavor to secure such
registration or approval, as the case may be; and
(v) if and so long as the Common Stock or any
other securities issuable upon the exercise of this Warrant are
listed on Nasdaq, any national securities exchange or any comparable
system, the Company will, if permitted by the rules of such exchange
or system, list and keep listed on such exchange or system, upon
official notice of issuance, all shares of such capital stock.
6. No Shareholder Rights.
This Warrant shall not entitle the holder hereof to any
voting rights or other rights as a shareholder of the Company.
7. Restrictions on Transfer.
(a) This Warrant and the Warrant Shares issuable upon
exercise hereof are subject to restrictions on transfer contained in the
Stockholders and Registration Rights Agreement (the "Stockholders
Agreement"), dated as of June 9, 2000, between the Company and AOL. No
transfer, sale, assignment, pledge, hypothecation or other disposition of
this Warrant or the Warrant Shares issuable upon exercise hereof may be made
except in accordance with the provisions of the Stockholders Agreement.
(b) The holder of this Warrant acknowledges that neither
this Warrant nor the Warrant Shares have been registered under the Securities
Act of 1933, as amended (the "Securities Act") and the holder of this Warrant
CUSIP No. 888 706108 Page 25 of 51
agrees that no sale, transfer, assignment, hypothecation or other disposition
of this Warrant or the Warrant Shares shall be made in the absence of (i)
current registration statement under the Securities Act as to this Warrant or
the Warrant Shares and the registration or qualification of this Warrant or
the Warrant Shares under any applicable state securities laws is then in
effect or (ii) an opinion of counsel reasonably satisfactory to the Company
to the effect that such registration or qualification is not required.
(c) Each certificate or other instrument for Warrant
Shares issued upon exercise of this Warrant shall, if required under the
Securities Act or the rules promulgated thereunder, be imprinted with a
legend substantially to the effect set forth in each of Sections 7(a) and
7(b).
8. Rights of the Holder.
Anything contained herein to the contrary notwithstanding,
the shares of Common Stock issuable upon exercise of this Warrant shall be
entitled to all rights and benefits accorded thereto in any investor rights
or shareholders or similar agreement between and/or among the Company and the
holders of the Common Stock, and the Company shall take all actions and shall
execute and deliver all documents necessary or desirable, including any
amendments to such agreement(s) to make the holder a party thereto.
9. Transfer of Warrant.
(a) Subject to the restriction set forth in Section 7,
this Warrant and all rights hereunder are transferable, in whole, or in part,
at the agency or office of the Company referred to in Section 2, by the
holder hereof in person or by duly authorized attorney, upon surrender of
this Warrant properly endorsed, together with a written assignment of this
Warrant substantially in the form of Exhibit B hereto. Upon surrender at
such agency or office, this Warrant may be exchanged for a Warrant or
Warrants in other denominations or the transfer thereof may be registered in
whole or in part; provided that such other Warrants evidence the same
aggregate number of Warrant Shares as the Warrant so surrendered.
(b) The Company shall prepare, issue and deliver at its
own expense (other than transfer taxes) a new Warrant under this Section 9.
The Company will pay all documentary stamp taxes attributable to the initial
issuance of this Warrant and of the Warrant Shares upon the exercise of this
Warrant. Notwithstanding the foregoing, the Company will not be required to
CUSIP No. 888 706108 Page 26 of 51
pay any tax or taxes which may be payable in respect of any transfer involved
in the issuance of any Warrant or any certificates for Warrant Shares in a
name other than that of the registered holder of such Warrant, and the
Company shall not be required to issue or deliver such Warrant unless or
until the person or persons requesting the issuance thereof shall have paid
to the Company the amount of such tax or shall have established to the
reasonable satisfaction of the Company that such tax has been paid.
(c) The Company agrees to maintain, at its aforesaid
office or agency, books for the registration or transfer of the Warrants.
10. Reorganizations, Etc.
In case of any capital reorganization, of any
reclassification of the stock of the Company (other than a change in par
value or from par value to no par value or from no par value to par value or
as a result of a stock dividend or subdivision, split-up or combination of
shares), or the consolidation or merger of the Company with or into another
corporation (other than a consolidation or merger in which the Company is the
continuing corporation and which does not result in any change in the Common
Stock) or of the sale of all or substantially all the properties and assets
of the Company as an entirety to any other corporation, this Warrant shall,
after such reorganization, reclassification, consolidation, merger or sale,
be exercisable for the kind and number of shares of stock or other securities
or property of the Company or of the corporation resulting from such
consolidation or surviving such merger or to which such properties and assets
shall have been sold to which such holder would have been entitled if he had
held the Common Stock issuable upon the exercise hereof immediately prior to
such reorganization, reclassification, consolidation, merger or sale. In any
such reorganization or other action or transaction described above,
appropriate provision shall be made with respect to the rights and interests
of the holder of this Warrant to the end that the provisions hereof
(including, without limitation, provisions for adjustments of the Warrant
Price and of the number of shares purchasable and receivable upon the
exercise of this Warrant) shall thereafter be applicable, as nearly as may
be, in relation to any shares of stock, securities or assets thereafter
deliverable upon the exercise hereof. The Company will not effect any such
consolidation, merger or sale unless, prior to the consummation thereof, the
successor corporation or entity (if other than the Company) resulting from
such transaction or the corporation or entity purchasing such assets shall
assume by a written instrument, executed and mailed or delivered to the
registered holder hereof at the last address of such holder appearing on the
CUSIP No. 888 706108 Page 27 of 51
books of the Company, the obligation to deliver to such holder such shares of
stock, securities or assets as, in accordance with the foregoing provisions,
such holder may be entitled to purchase.
11. Lost, Stolen, Mutilated or Destroyed Warrant.
If this Warrant is lost, stolen, mutilated or destroyed, the
Company may, on such terms as to indemnity or otherwise as it may in its
reasonable discretion impose (which shall, in the case of a mutilated
Warrant, include the surrender thereof), issue a new Warrant of like
denomination and tenor as the Warrant so lost, stolen, mutilated or
destroyed. Any such new Warrant shall constitute an original contractual
obligation of the Company, whether or not the allegedly lost, stolen,
mutilated or destroyed Warrant shall be at any time enforceable by anyone.
12. Modification and Waiver.
This Warrant and any provision hereof may be changed,
waived, discharged or terminated only by an instrument in writing signed by
the party against which enforcement of the same is sought.
13. Notices.
All notices, advices and communications to be given or
otherwise made to any party to this Warrant shall be deemed to be sufficient
if contained in a written instrument delivered in person or by telecopier or
duly sent by first class registered or certified mail, return receipt
requested, postage prepaid, or by overnight courier, or by electronic mail,
with a copy thereof to be sent by mail (as aforesaid) within 24 hours of such
electronic mail, addressed to such party at the address set forth below or at
such other address as may hereafter be designated in writing by the addressee
to the addresser listing all parties:
CUSIP No. 888 706108 Page 28 of 51
(a) If to the Company, to:
TiVo Inc.
2160 Gold Street
Alviso, CA 95002
Attention: Chief Financial Officer
Telecopier: (408) 519-5333
e-mail address: dave@tivo.com; and
(b) If to AOL as follows:
America Online, Inc.
22000 AOL Way
Dulles, Virginia 20166
Attention: General Counsel
Telecopier: (703) 265-1495
e-mail address: PTCapp@aol.com
Or to such other address as the party to whom notice is to be given may have
furnished to the other parties hereto in writing in accordance herewith. Any
such notice or communication shall be deemed to have been delivered and
received (i) in the case of personal delivery or delivery by telecopier, on
the date of such deliver, (ii) in the case of nationally recognized overnight
courier, on the next Business Day after the date when sent and (ii) in the
case of mailing, on the third Business Day following that on which the piece
of mail containing such communication is posted.
14. Binding Effect on Successors; Survival.
This Warrant shall be binding upon any corporation
succeeding the Company by merger, consolidation or acquisition of all or
substantially all of the Company's assets. All of the obligations of the
Company relating to the Common Stock issuable upon the exercise of this
Warrant shall survive the exercise and termination of this Warrant. All of
the covenants and agreements of the Company shall inure to the benefit of the
successors and assigns of AOL.
15. Descriptive Headings and Governing Law.
The description headings of the several sections and
paragraphs of this Warrant are inserted for convenience only and do not
constitute a part of this Warrant. This Warrant shall be construed and
CUSIP No. 888 706108 Page 29 of 51
enforced in accordance with, and the rights of the parties shall be governed
by, the laws of the State of New York.
16. Fractional Shares.
No fractional shares shall be issued upon exercise of this
Warrant. The Company shall, in lieu of issuing any fractional share, pay the
holder entitled to such fraction a sum in cash equal to such fraction
multiplied by the then Fair Market Value of one Warrant Share.
17. Limitation of Liability.
No provision of this Warrant, in the absence of affirmative
action by the holder hereof to purchase Warrant Shares, and no enumeration in
this Warrant of the rights or privileges of the holder hereof, shall give
rise to any liability of such holder for the purchase price of any Warrant
Shares or as a stockholder of the Company, whether such liability is asserted
by the Company or by creditors of the Company.
18. Remedies.
The Company and the holder of this Warrant each stipulates
that the remedies at law of each party hereto in the event of any default or
threatened default by the other party in the performance or compliance with
any of the terms of this Warrant are not and will not be adequate and that,
to the fullest extent permitted by law, such terms may be specifically
enforced by a decree for the specific performance of any agreement contained
herein or by an injunction against a violation of any of the terms hereof or
otherwise.
19. Counterparts.
This Warrant may be executed by any number of counterparts
and each of such counterparts will for all purposes be deemed to be an
original, and all such counterparts will together constitute one and the same
instrument.
20. Severability.
The provisions of this Warrant are severable, and if any
clause or provision may be held invalid, illegal or unenforceable in whole or
in part in any jurisdiction, then such invalidity or unenforceability will
CUSIP No. 888 706108 Page 30 of 51
affect only that clause or provision, in part thereof, in that jurisdiction,
and shall not in any manner affect that clause or provision or any other
clause or provision in this Warrant in any other jurisdiction.
21. Nonwaiver.
No course of dealing or any delay or failure to exercise any
right under this Warrant by any holder of this Warrant will operate as a
waiver of such right or otherwise prejudice such holder's rights, power or
remedies.
[Remainder of page intentionally left blank.]
CUSIP No. 888 706108 Page 31 of 51
IN WITNESS WHEREOF, the undersigned have caused this Warrant
to be executed by their duly authorized officers on the date first above
written.
TIVO INC.
By: /s/ David H. Courtney
-------------------------
Name: David H. Courtney
Title: Senior VP, Finance &
Administration
ATTEST: /s/ Alan C. Mendelson
---------------------
Alan C. Mendelson, Secretary
AMERICA ONLINE, INC.
By: /s/ Lynda Clarizio
------------------------
Name: Lynda Clarizio
Title: Senior Vice President
CUSIP No. 888 706108 Page 32 of 51
Exhibit A
Notice of Exercise
[To be signed upon exercise of Warrant]
The undersigned, the holder of the Warrant, hereby
irrevocably elects to exercise the purchase rights represented by such
Warrant for, and to purchase thereunder, _________ shares of _________ of
TiVo Inc. and herewith makes payment of $_________ therefor, and requests
that the certificates for such shares be issued in the name of and delivered
to, _________________________________, whose address is
_________________________________________________.
Dated:_____________
_________________________________
(Signature)
_________________________________
(Address)
CUSIP No. 888 706108 Page 33 of 51
Exhibit B
Form of Assignment
[To be signed only upon transfer of Warrant]
For value received, the undersigned hereby sells, assigns
and transfers unto the right represented by the Warrant to purchase _______
shares of _________ of TiVo Inc., to which the Warrant relates, and appoints
Attorney to transfer such right on the books of TiVo Inc., with full power of
substitution in the premises.
Dated:_____________
____________________________
(Signature)
Signed in the presence of:
______________________________
CUSIP No. 888 706108 Page 34 of 51
Exhibit C
THE SECURITIES REPRESENTED BY THIS CERTIFICATE HAVE BEEN ACQUIRED FOR
INVESTMENT AND HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS
AMENDED. THESE SECURITIES MAY NOT BE SOLD, OFFERED FOR SALE, PLEDGED OR
HYPOTHECATED IN THE ABSENCE OF AN EFFECTIVE REGISTRATION STATEMENT AS TO THE
SECURITIES UNDER SAID ACT OR LAWS OR AN OPINION OF COUNSEL SATISFACTORY TO
THE COMPANY THAT SUCH REGISTRATION IS NOT REQUIRED.
TIVO INC.
AMENDED AND RESTATED
STOCK SUBSCRIPTION WARRANT
No. VW - B - 1 September 13, 2000
1. General.
(a) THIS CERTIFIES that, for value received, AMERICA
ONLINE, INC. ( "AOL"), or its assigns, is entitled to subscribe for and
purchase from TIVO INC., a Delaware corporation (the "Company"), at any time
or from time to time during the period (the "Exercise Period") commencing
with the date hereof and ending on December 31, 2003, on the terms and
subject to the provisions hereinafter set forth, up to 295,428 shares
(subject to adjustment as provided herein) of fully paid and non-assessable
shares of Common Stock, $0.001 par value (the "Common Stock"), of the
Company, at a price per share (the "Warrant Price") of $7.29.
(b) This Amended and Restated Warrant (this "Warrant")
amends and restates in its entirety the TiVo Inc. Stock Subscription Warrant
No. VW-A-1, dated September 13, 2000, issued to the Purchaser by the Company.
This Warrant is being issued pursuant to an Investment Agreement dated as of
June 9, 2000, as amended by the First Amendment, dated as of September 13,
2000, and as amended by the Second Amendment, dated as of January 30, 2001
(collectively, the "Agreement"), between the Company and AOL. All terms used
but not defined herein shall have the meanings set forth in the Agreement.
The shares of capital stock of the Company issuable upon exercise of this
Warrant are sometimes hereinafter referred to as the "Warrant Shares."
CUSIP No. 888 706108 Page 35 of 51
2. Exercise of Warrant.
(a) Subject to Section 2(b), the rights represented by
this Warrant may be exercised by the holder hereof, in whole or in part, at
any time or from time to time during the Exercise Period, by (i) the
surrender of this Warrant, together with an executed Notice of Exercise in
substantially the form attached hereto as Exhibit A, at the office of the
Company at 2160 Gold Street, Alviso, CA 95002, or at such other agency or
office of the Company in the United States of America as it may designate by
notice in writing to the holder hereof at the address of such holder
appearing on the books of the Company, and (ii) payment (either in cash or by
check) to the Company of the Warrant Price for each Warrant Share being
purchased. In the event of the exercise of the rights represented by this
Warrant, a certificate or certificates for the Warrant Shares so purchased,
registered in the name of the holder, and if this Warrant shall not have been
exercised for all of the Warrant Shares, a new Warrant, registered in the
name of the holder hereof, of like tenor to this Warrant and representing the
remaining Warrant Shares, shall be delivered to the holder hereof within a
reasonable time, not exceeding ten (10) days, after the rights represented by
this Warrant shall have been so exercised. The person in whose name any
certificate for Warrant Shares is issued upon exercise of this Warrant shall
for all purposes be deemed to have become the holder of record of such shares
on the date on which the Warrant was surrendered and payment of the Warrant
Price and any applicable taxes was made, irrespective of the date of delivery
of such certificate, except that, if the date of such surrender and payment
is a date when the stock transfer books of the Company are closed, such
person shall be deemed to have become the holder of such shares at the close
of business on the next succeeding date on which the stock transfer books are
open.
(b) If the last reported trading price of the Common
Stock as reported on the Nasdaq National Market of the Nasdaq Stock Market
Inc., ("Nasdaq"), exceeds $30.00 per share for at least eighteen (18) trading
days in any consecutive twenty (20) trading day period (the "Mandatory
Exercise Trigger Event"), then the holder shall be obligated to exercise a
portion of this Warrant with respect to zero (0) Warrant Shares (the
"Mandatory Warrant Shares") in accordance with the provisions of this Section
2.
(c) The Company will promptly provide the holder of this
Warrant with written notice (the "Mandatory Exercise Notice") of the
occurrence of a Mandatory Exercise Trigger Event, which shall include a table
CUSIP No. 888 706108 Page 36 of 51
showing the last reported trading prices of the Common Stock as reported on
Nasdaq for the twenty (20) trading day period referred to in Section 2(b) and
shall specify (i) the number of Mandatory Warrant Shares and (ii) the total
payment due from the holder (which payment may be made either in cash or by
check).
(d) The closing of the Mandatory Exercise will take
place as soon as reasonably practicable following the delivery of a Mandatory
Exercise Notice, but, subject to the absence of an error in the determination
referred to in Section 2(b) and receipt of any required governmental
approvals, no later than thirty (30) days following such delivery. Such
closing will take place at the offices of the Company, or at such other
location as the holder and the Company, acting reasonably, shall agree. At
such closing, the Company shall issue and deliver to the holder or its
designee a certificate or certificates for the Warrant Shares to be issued
upon the Mandatory Exercise, registered in the name of the holder or such
designee, and if the Mandatory Warrant Shares do not constitute all the
Warrant Shares issuable upon exercise of this Warrant, a new Warrant,
registered in the name of the holder, of like tenor to this Warrant (but
excluding any mandatory exercise obligations) for the number of shares
remaining subject to this Warrant following such Mandatory Exercise.
3. Adjustment of Warrant Price.
(a) The Warrant Price shall be subject to adjustment
from time to time as follows:
(i) If the number of shares of Common Stock
outstanding is increased by a stock dividend payable in shares of
Common Stock or by a subdivision or split-up of shares of Common
Stock, then, following the record date fixed for the determination of
holders of Common Stock entitled to receive such stock dividend,
subdivision or split-up, the Warrant Price shall be appropriately
decreased and the number of shares of Common Stock issuable upon
exercise of this Warrant shall be appropriately increased, in each
case in proportion to such increase in outstanding shares. Shares of
Common Stock owned by or held for the account of the Company shall
not be deemed outstanding for the purpose of any such computation.
Such adjustment shall be made successively whenever such a record
date is fixed; and in the event that such subdivision or split-up is
not effected, the Warrant Price shall again be adjusted to be the
CUSIP No. 888 706108 Page 37 of 51
Warrant Price which would then be in effect if such record date had
not been fixed.
(ii) If the number of shares of Common Stock
outstanding is decreased by a combination of the outstanding shares
of Common Stock, then, following the record date for such
combination, the Warrant Price shall be appropriately increased and
the number of shares of Common Stock issuable upon exercise of this
Warrant shall be appropriately decreased, in each case, in proportion
to such decrease in outstanding shares. Such adjustment shall be
made successively whenever such a record date is fixed; and in the
event that such combination is not effected, the Warrant Price shall
again be adjusted to be the Warrant Price which would then be in
effect if such record date had not been fixed.
(iii) In the event of any capital reorganization
of the Company, any reclassification of the stock of the Company
(other than a change in par value or from par value to no par value
or from no par value to par value or as a result of a stock dividend
or subdivision, split-up or combination of shares), or any
consolidation or merger of the Company (other than a consolidation or
merger in which the Company is the continuing corporation and which
does not result in any change in the Common Stock), this Warrant
shall after such reorganization, reclassification, consolidation or
merger be exercisable or exchangeable into the kind and number of
shares of stock or other securities or property of the Company or of
the corporation resulting from such consolidation or surviving such
merger to which the holder of the number of shares of Common Stock
deliverable (immediately prior to the time of such reorganization,
reclassification, consolidation or merger) upon exercise of this
Warrant would have been entitled upon such reorganization,
reclassification, consolidation or merger. The provisions of this
clause shall similarly apply to successive reorganizations,
reclassifications, consolidations or mergers.
(iv) In case the Company shall issue warrants or
other rights to all holders of Common Stock entitling them to
subscribe for or purchase shares of Common Stock at a price per share
less than the Fair Market Value of the Common Stock (as defined
below, with a Determination Date as of the record date for the
determination of stockholders entitled to receive such rights or
warrants, the Warrant Price in effect after such record date shall be
CUSIP No. 888 706108 Page 38 of 51
determined by multiplying such Warrant Price by a fraction, the
numerator of which shall be the number of shares of Common Stock
outstanding at the close of business on the record date for issuance
of such rights or warrants plus the number of shares of Common Stock
which the aggregate offering price of the total number of shares of
Common Stock so offered would purchase at such Fair Market Value, and
the denominator of which shall be the number of shares of Common
Stock outstanding at the close of business on the record date for
issuance of such rights or warrants plus the total number of shares
of Common Stock receivable upon exercise of such rights or warrants.
Such adjustment shall be made successively whenever any such rights
or warrants are issued, and shall become effective immediately after
such record date. In case such subscription price may be paid in a
consideration part or all of which shall be in a form other than
cash, the value of such consideration shall be as determined by a
nationally recognized independent investment banking firm jointly
selected by the Company and the holder of this Warrant or, if such
selection cannot be made within five (5) Business Days after the
record date referred to above, by a nationally recognized independent
investment banking firm selected by the American Arbitration
Association. Shares of Common Stock owned by or held for the account
of the Company shall not be deemed outstanding for the purpose of any
such computation. Such adjustment shall be made successively
whenever such a record date is fixed; and in the event that such
rights or warrants are not so issued, the Warrant Price shall again
be adjusted to be the Warrant Price which would then be in effect if
such record date had not been fixed. For purposes hereof:
"Fair Market Value" of one share of Common Stock as of any
date (the "Determination Date") means:
(A) (1) the average of the closing
prices quoted on Nasdaq, if applicable, or the average of
the last bid and asked prices of the Common Stock quoted in
the over-the-counter-market or (2) if the Common Stock is
then traded on a national securities exchange, the average
of the high and low prices of the Common Stock listed on the
principal national securities exchange on which the Common
Stock is so traded, in each case for the twenty (20) trading
days immediately preceding the Determination Date or, if
such date is not a business day on which shares are traded,
the next immediately preceding trading day; and
CUSIP No. 888 706108 Page 39 of 51
(B) in connection with a Corporate
Transaction (as hereinafter defined), the value per share of
Common Stock received or receivable by each holder thereof
(assuming for purposes of this determination, in the case of
a sale of assets, the Company is liquidated immediately
following such sale and the consideration paid to the
Company is immediately distributed to its stockholders); and
(C) in all other circumstances, the
fair market value per share of Common Stock as determined by
a nationally recognized independent investment banking firm
jointly selected by the Company and the holder of this
Warrant or, if such selection cannot be made within five (5)
Business Days after the Determination Date, by a nationally
recognized independent investment banking firm selected by
the American Arbitration Association; and
"Corporate Transaction" means (i) any consolidation or
merger of the Company with or into any other corporation or other
entity, other than any merger or consolidation resulting in the
holders of the capital stock of the Company entitled to vote for the
election of directors holding a majority of the capital stock of the
surviving or resulting corporation or its ultimate parent entity
entitled to vote for the election of directors, (ii) any person or
entity (including any affiliates thereof) becoming the holder of 50%
of the capital stock of the Company entitled to vote for the election
of directors, or (iii) any sale or other disposition by the Company
of all or substantially all of its assets or capital stock.
(v) In case the Company shall distribute to all
holders of shares of Common Stock (including any such distribution
made in connection with a consolidation or merger in which the
Company is the continuing corporation) any shares of capital stock of
the Company (other than shares of Common Stock) or evidences of its
indebtedness or assets or rights or warrants to subscribe for or
purchase any of its securities (excluding those rights or warrants
referred to in subparagraph (iv) above) (any of the foregoing being
hereinafter in this subparagraph (v) called the "Securities"), then,
in each such case, the Warrant Price shall be adjusted so that the
same shall equal the price determined by multiplying the Warrant
Price in effect immediately prior to the date of such distribution by
a fraction the numerator of which shall be the Fair Market Value (as
CUSIP No. 888 706108 Page 40 of 51
defined above) of the Common Stock with a Determination Date as of
the record date mentioned above, less the then fair market value (as
determined by a nationally recognized independent investment banking
firm jointly selected by the Company and the holder of this Warrant
or, if such selection cannot be made within five (5) Business Days
after the record date referred to above, by a nationally recognized
independent investment banking firm selected by the American
Arbitration Association) of the portion of the Securities so
distributed allocable to one share of Common Stock, and the
denominator of which shall be the Fair Market Value of the Common
Stock. Such adjustment shall become effective immediately prior to
the opening of business on the day following the record date for the
determination of shareholders entitled to receive such distribution.
In the event that such distribution is not so made, the Warrant Price
shall again be adjusted to be the Warrant Price which would then be
in effect if such date fixed for the determination of shareholders
entitled to receive such distribution had not been fixed.
(vi) All calculations under this Section 3 shall
be made to the nearest one tenth (1/10) of a cent or to the nearest
one tenth (1/10) of a share, as the case may be.
(b) Whenever the Warrant Price shall be adjusted as
provided in this Section 3 the Company shall forthwith file, at the office of
the Company or any transfer agent designated by the Company for the Common
Stock, a statement, signed by its chief financial officer, showing in detail
the facts requiring such adjustment and the adjusted Warrant Price. The
Company shall also cause a copy of such statement to be sent by first-class
certified mail, return receipt requested, postage prepaid, to each holder of
a Warrant at his or its address appearing on the Company's records. Where
appropriate, such copy may be given in advance and may be included as part of
a notice required to be mailed under the provisions set forth immediately
below.
(c) In the event the Company shall propose to take any
action of the types described in Section 3(a) or Section 10, the Company
shall give notice to each holder of a Warrant in the manner set forth herein,
which notice shall specify the record date, if any, with respect to any such
action and the date on which such action is to take place. Such notice shall
also set forth such facts with respect thereto as shall be reasonably
necessary to indicate the effect of such action (to the extent such effect
may be known at the date of such notice) on the Warrant Price then in effect
CUSIP No. 888 706108 Page 41 of 51
and the number, kind or class of shares or other securities or property which
shall be delivered or purchasable upon the occurrence of such action or
deliverable upon exercise of this Warrant. In the case of any action which
would require the fixing of a record date, such notice shall be given at
least twenty (20) days prior to the date so fixed, and in case of all other
action, such notice shall be given at least thirty (30) days prior to the
taking of such proposed action. Failure to give such notice, or any defect
therein, shall not affect the legality or validity of any such action.
4. Adjustment of Warrant Shares.
Upon each adjustment of the Warrant Price as provided in
Section 3, the holder hereof shall thereafter be entitled to subscribe for
and purchase, at the Warrant Price resulting from such adjustment, the number
of Warrant Shares equal to the product of (i) the number of Warrant Shares
existing prior to such adjustment and (ii) the quotient obtained by dividing
(A) the Warrant Price existing prior to such adjustment by (B) the new
Warrant Price resulting from such adjustment. No fractional shares of Common
Stock shall be issued as a result of any such adjustment, and any fractional
shares resulting from the computations pursuant to this paragraph shall be
eliminated without consideration.
5. Covenants.
The Company covenants and agrees that:
(i) all shares of Common Stock and any other
securities which may be issued upon the exercise of the rights
represented by this Warrant will, upon issuance, be validly issued,
fully paid and non-assessable and free from all taxes, liens and
charges with respect to the issuance thereof;
(ii) the Company will from time to time take all
such action as may be requisite to assure that the stated or par
value per share of the Common Stock is at all times equal to or less
than the then effective Warrant Price per share of Preferred Stock
issuable upon exercise of this Warrant;
(iii) the Company will at all times have
authorized and reserved, free from preemptive rights, a sufficient
number of shares of its Common Stock and any other securities to
provide for the exercise of the rights represented by this Warrant;
CUSIP No. 888 706108 Page 42 of 51
(iv) if any shares of Common Stock or any other
securities to be reserved to provide for the exercise of this Warrant
require registration with or approval of any Governmental Authority
under any Federal or state law before such shares may be validly
issued or delivered upon exercise, then the Company will in good
faith and expeditiously as possible endeavor to secure such
registration or approval, as the case may be; and
(v) if and so long as the Common Stock or any
other securities issuable upon the exercise of this Warrant are
listed on Nasdaq, any national securities exchange or any comparable
system, the Company will, if permitted by the rules of such exchange
or system, list and keep listed on such exchange or system, upon
official notice of issuance, all shares of such capital stock.
6. No Shareholder Rights.
This Warrant shall not entitle the holder hereof to any
voting rights or other rights as a shareholder of the Company.
7. Restrictions on Transfer.
(a) This Warrant and the Warrant Shares issuable upon
exercise hereof are subject to restrictions on transfer contained in the
Stockholders and Registration Rights Agreement (the "Stockholders
Agreement"), dated as of June 9, 2000, between the Company and AOL. No
transfer, sale, assignment, pledge, hypothecation or other disposition of
this Warrant or the Warrant Shares issuable upon exercise hereof may be made
except in accordance with the provisions of the Stockholders Agreement.
(b) The holder of this Warrant acknowledges that neither
this Warrant nor the Warrant Shares have been registered under the Securities
Act of 1933, as amended (the "Securities Act") and the holder of this Warrant
agrees that no sale, transfer, assignment, hypothecation or other disposition
of this Warrant or the Warrant Shares shall be made in the absence of (i)
current registration statement under the Securities Act as to this Warrant or
the Warrant Shares and the registration or qualification of this Warrant or
the Warrant Shares under any applicable state securities laws is then in
effect or (ii) an opinion of counsel reasonably satisfactory to the Company
to the effect that such registration or qualification is not required.
CUSIP No. 888 706108 Page 43 of 51
(c) Each certificate or other instrument for Warrant
Shares issued upon exercise of this Warrant shall, if required under the
Securities Act or the rules promulgated thereunder, be imprinted with a
legend substantially to the effect set forth in each of Sections 7(a) and
7(b).
8. Rights of the Holder.
Anything contained herein to the contrary notwithstanding,
the shares of Common Stock issuable upon exercise of this Warrant shall be
entitled to all rights and benefits accorded thereto in any investor rights
or shareholders or similar agreement between and/or among the Company and the
holders of the Common Stock, and the Company shall take all actions and shall
execute and deliver all documents necessary or desirable, including any
amendments to such agreement(s) to make the holder a party thereto.
9. Transfer of Warrant.
(a) Subject to the restriction set forth in Section 7,
this Warrant and all rights and obligations hereunder (including the
obligation to purchase all or a portion of the Mandatory Warrant Shares) are
transferable, in whole, or in part, at the agency or office of the Company
referred to in Section 2, by the holder hereof in person or by duly
authorized attorney, upon surrender of this Warrant properly endorsed,
together with a written assignment of this Warrant substantially in the form
of Exhibit B hereto. Upon surrender at such agency or office, this Warrant
may be exchanged for a Warrant or Warrants in other denominations or the
transfer thereof may be registered in whole or in part; provided that such
other Warrants evidence the same aggregate number of Warrant Shares as the
Warrant so surrendered.
(b) The Company shall prepare, issue and deliver at its
own expense (other than transfer taxes) a new Warrant under this Section 9.
The Company will pay all documentary stamp taxes attributable to the initial
issuance of this Warrant and of the Warrant Shares upon the exercise of this
Warrant. Notwithstanding the foregoing, the Company will not be required to
pay any tax or taxes which may be payable in respect of any transfer involved
in the issuance of any Warrant or any certificates for Warrant Shares in a
name other than that of the registered holder of such Warrant, and the
Company shall not be required to issue or deliver such Warrant unless or
until the person or persons requesting the issuance thereof shall have paid
CUSIP No. 888 706108 Page 44 of 51
to the Company the amount of such tax or shall have established to the
reasonable satisfaction of the Company that such tax has been paid.
(c) The Company agrees to maintain, at its aforesaid
office or agency, books for the registration or transfer of the Warrants.
10. Reorganizations, Etc.
In case of any capital reorganization, of any
reclassification of the stock of the Company (other than a change in par
value or from par value to no par value or from no par value to par value or
as a result of a stock dividend or subdivision, split-up or combination of
shares), or the consolidation or merger of the Company with or into another
corporation (other than a consolidation or merger in which the Company is the
continuing corporation and which does not result in any change in the Common
Stock) or of the sale of all or substantially all the properties and assets
of the Company as an entirety to any other corporation, this Warrant shall,
after such reorganization, reclassification, consolidation, merger or sale,
be exercisable for the kind and number of shares of stock or other securities
or property of the Company or of the corporation resulting from such
consolidation or surviving such merger or to which such properties and assets
shall have been sold to which such holder would have been entitled if he had
held the Common Stock issuable upon the exercise hereof immediately prior to
such reorganization, reclassification, consolidation, merger or sale. In any
such reorganization or other action or transaction described above,
appropriate provision shall be made with respect to the rights and interests
of the holder of this Warrant to the end that the provisions hereof
(including, without limitation, provisions for adjustments of the Warrant
Price and of the number of shares purchasable and receivable upon the
exercise of this Warrant) shall thereafter be applicable, as nearly as may
be, in relation to any shares of stock, securities or assets thereafter
deliverable upon the exercise hereof. The Company will not effect any such
consolidation, merger or sale unless, prior to the consummation thereof, the
successor corporation or entity (if other than the Company) resulting from
such transaction or the corporation or entity purchasing such assets shall
assume by a written instrument, executed and mailed or delivered to the
registered holder hereof at the last address of such holder appearing on the
books of the Company, the obligation to deliver to such holder such shares of
stock, securities or assets as, in accordance with the foregoing provisions,
such holder may be entitled to purchase.
CUSIP No. 888 706108 Page 45 of 51
11. Lost, Stolen, Mutilated or Destroyed Warrant.
If this Warrant is lost, stolen, mutilated or destroyed, the
Company may, on such terms as to indemnity or otherwise as it may in its
reasonable discretion impose (which shall, in the case of a mutilated
Warrant, include the surrender thereof), issue a new Warrant of like
denomination and tenor as the Warrant so lost, stolen, mutilated or
destroyed. Any such new Warrant shall constitute an original contractual
obligation of the Company, whether or not the allegedly lost, stolen,
mutilated or destroyed Warrant shall be at any time enforceable by anyone.
12. Modification and Waiver.
This Warrant and any provision hereof may be changed,
waived, discharged or terminated only by an instrument in writing signed by
the party against which enforcement of the same is sought.
13. Notices.
All notices, advices and communications to be given or
otherwise made to any party to this Warrant shall be deemed to be sufficient
if contained in a written instrument delivered in person or by telecopier or
duly sent by first class registered or certified mail, return receipt
requested, postage prepaid, or by overnight courier, or by electronic mail,
with a copy thereof to be sent by mail (as aforesaid) within 24 hours of such
electronic mail, addressed to such party at the address set forth below or at
such other address as may hereafter be designated in writing by the addressee
to the addresser listing all parties:
(a) If to the Company, to:
TiVo Inc.
2160 Gold Street
Alviso, CA 95002
Attention: Chief Financial Officer
Telecopier: (408) 519-5333
e-mail address: dave@tivo.com; and
CUSIP No. 888 706108 Page 46 of 51
(b) If to AOL as follows:
America Online, Inc.
22000 AOL Way
Dulles, Virginia 20166
Attention: General Counsel
Telecopier: (703) 265-1495
e-mail address: PTCapp@aol.com
Or to such other address as the party to whom notice is to be given may have
furnished to the other parties hereto in writing in accordance herewith. Any
such notice or communication shall be deemed to have been delivered and
received (i) in the case of personal delivery or delivery by telecopier, on
the date of such deliver, (ii) in the case of nationally recognized overnight
courier, on the next Business Day after the date when sent and (ii) in the
case of mailing, on the third Business Day following that on which the piece
of mail containing such communication is posted.
14. Binding Effect on Successors; Survival.
This Warrant shall be binding upon any corporation
succeeding the Company by merger, consolidation or acquisition of all or
substantially all of the Company's assets. All of the obligations of the
Company relating to the Common Stock issuable upon the exercise of this
Warrant shall survive the exercise and termination of this Warrant. All of
the covenants and agreements of the Company shall inure to the benefit of the
successors and assigns of AOL.
15. Descriptive Headings and Governing Law.
The description headings of the several sections and
paragraphs of this Warrant are inserted for convenience only and do not
constitute a part of this Warrant. This Warrant shall be construed and
enforced in accordance with, and the rights of the parties shall be governed
by, the laws of the State of New York.
16. Fractional Shares.
No fractional shares shall be issued upon exercise of this
Warrant. The Company shall, in lieu of issuing any fractional share, pay the
holder entitled to such fraction a sum in cash equal to such fraction
multiplied by the then Fair Market Value of one Warrant Share.
CUSIP No. 888 706108 Page 47 of 51
17. Limitation of Liability.
Except as specifically set forth in Section 2(b), no
provision of this Warrant, in the absence of affirmative action by the holder
hereof to purchase Warrant Shares, and no enumeration in this Warrant of the
rights or privileges of the holder hereof, shall give rise to any liability
of such holder for the purchase price of any Warrant Shares or as a
stockholder of the Company, whether such liability is asserted by the Company
or by creditors of the Company.
18. Remedies.
The Company and the holder of this Warrant each stipulates
that the remedies at law of each party hereto in the event of any default or
threatened default by the other party in the performance or compliance with
any of the terms of this Warrant are not and will not be adequate and that,
to the fullest extent permitted by law, such terms may be specifically
enforced by a decree for the specific performance of any agreement contained
herein or by an injunction against a violation of any of the terms hereof or
otherwise.
19. Counterparts.
This Warrant may be executed by any number of counterparts
and each of such counterparts will for all purposes be deemed to be an
original, and all such counterparts will together constitute one and the same
instrument.
20. Severability.
The provisions of this Warrant are severable, and if any
clause or provision may be held invalid, illegal or unenforceable in whole or
in part in any jurisdiction, then such invalidity or unenforceability will
affect only that clause or provision, in part thereof, in that jurisdiction,
and shall not in any manner affect that clause or provision or any other
clause or provision in this Warrant in any other jurisdiction.
21. Nonwaiver.
No course of dealing or any delay or failure to exercise any
right under this Warrant by any holder of this Warrant will operate as a
CUSIP No. 888 706108 Page 48 of 51
waiver of such right or otherwise prejudice such holder's rights, power or
remedies.
[Remainder of page intentionally left blank.]
CUSIP No. 888 706108 Page 49 of 51
IN WITNESS WHEREOF, the undersigned have caused this Warrant
to be executed by their duly authorized officers on the date first above
written.
TIVO INC.
By: /s/ David H. Courtney
-------------------------
Name: David H. Courtney
Title: Senior VP, Finance &
Administration
ATTEST: /s/ Alan C. Mendelson
---------------------
Alan C. Mendelson, Secretary
AMERICA ONLINE, INC.
By: /s/ Lynda Clarizio
-------------------------
Name: Lynda Clarizio
Title: Senior Vice President
CUSIP No. 888 706108 Page 50 of 51
Exhibit A
Notice of Exercise
[To be signed upon exercise of Warrant]
The undersigned, the holder of the Warrant, hereby
irrevocably elects to exercise the purchase rights represented by such
Warrant for, and to purchase thereunder, _________ shares of _________ of
TiVo Inc. and herewith makes payment of $_________ therefor, and requests
that the certificates for such shares be issued in the name of and delivered
to, _________________________________, whose address is
_________________________________________________.
Dated:_____________
_________________________________
(Signature)
_________________________________
(Address)
CUSIP No. 888 706108 Page 51 of 51
Exhibit B
Form of Assignment
[To be signed only upon transfer of Warrant]
For value received, the undersigned hereby sells, assigns
and transfers unto the right represented by the Warrant to purchase _______
shares of _________ of TiVo Inc., to which the Warrant relates, together with
the obligation, on the terms set forth in the Warrant, to purchase _________
Mandatory Warrant Shares, and appoints Attorney to transfer such right on the
books of TiVo Inc., with full power of substitution in the premises.
Dated:_____________
____________________________
(Signature)
Signed in the presence of:
______________________________