{"id":43796,"date":"2015-09-17T11:25:58","date_gmt":"2015-09-17T16:25:58","guid":{"rendered":"https:\/\/content.findlaw-admin.com\/ability-legal\/contracts\/uncategorized\/co-sale-agreement.html"},"modified":"2015-09-17T11:25:58","modified_gmt":"2015-09-17T16:25:58","slug":"co-sale-agreement","status":"publish","type":"corporate_contracts","link":"https:\/\/corporate.findlaw.com\/contracts\/securities\/co-sale-agreement.html","title":{"rendered":"Co-Sale Agreement"},"content":{"rendered":"<pre>\n                               CO-SALE AGREEMENT\n\n         This Co-Sale Agreement (the 'Co-Sale Agreement') is made as of June\n21, 1996, by and among Amazon.com, Inc., a Delaware corporation (the\n'Company'), the purchasers of the Company's Series A Preferred Stock\n(individually an 'Investor,' collectively the 'Investors'), and Jeffrey P.\nBezos (the 'Founder').\n\n         Whereas, the Company and the Investors are entering into a Series A\nPreferred Stock Purchase Agreement of even date herewith (the 'Purchase\nAgreement'); and\n\n         Whereas, in order to induce the Company and the Investors to enter\ninto the Purchase Agreement, the Company, the Investors and the Founder desire\nto enter into this Co-Sale Agreement, which pertains to sales of certain\nsecurities by the Founder;\n\n         Now, therefore, in consideration of the mutual promises and covenants\nhereinafter set forth, the Company, the Investors, and the Founder hereby agree\nas follows:\n                                   SECTION 1\n\n                                RIGHT OF CO-SALE\n\n         1.1     Sales by Founder.  In the event that the Founder proposes to\nsell, assign, transfer or otherwise convey shares of Common Stock or securities\nconvertible into, exchangeable for or exercisable for Common Stock ('Co-Sale\nSecurities'), then the Founder shall offer in writing to each Investor the\nright to participate in such sale on the same terms and conditions available to\nsuch Founder.\n\n                 Upon written notice to the Founder within fifteen (15) days of\nreceipt by each Investor of notification from the Founder of the proposed sale,\nan Investor may sell that number of shares of Co-Sale Securities equal to the\ntotal number of shares to be sold in the transaction, multiplied by a fraction,\nthe numerator of which is the number of shares of Co-Sale Securities held by\nsuch Investor and the denominator of which is the number of shares of Co-Sale\nSecurities held by all selling Investors plus the Founder.  To the extent any\nInvestor exercises such right of participation, the number of shares of Co-Sale\nSecurities that the Founder may sell in the transaction shall be\ncorrespondingly reduced.\n\n         1.2     Limitations on Right of Co-Sale.  Section 1.1 of this\nAgreement shall not apply where the sale, assignment, transfer or other\nconveyance of Co-Sale Securities by a Founder is:\n\n                 (a)      to that Founder's spouse, parents, or children or\nother members of the Founder's family (including relatives by marriage), or to\na custodian, trustee or other fiduciary for the account of the Founder or\nmembers of his family or to a family limited partnership,\n\nlimited liability company or other entity or person in connection with a bona\nfide estate planning transaction;\n\n                 (b)      by way of bequest or inheritance upon death;\n\n                 (c)      to the Company;\n\n                 (d)      by way of a bona fide gift;\n\n                 (e)      when the number of Co-Sale Securities to be\ntransferred, combined with all prior sales and transfers of Co-Sale Securities\nby Founder after the date hereof other than transfers pursuant to subparagraphs\n(a), (b), (c), (d) and (f) hereof, is equal to or less than fifteen percent\n(15%) of the Co-Sale Securities held by the Founder as of the date hereof; or\n\n                 (f)      by way of any pledge of Co-Sale Securities made by\nFounder pursuant to a bona fide loan transaction with an established financial\ninstitution that creates a mere security interest; provided, however, that any\ntransferees pursuant to this Section 1.2 shall receive and hold such shares\nsubject in all respects to the provisions of this Agreement, and that there\nshall be no further transfer of such shares except in accordance herewith.\n\n         1.3     Termination of Co-Sale Right.  The Co-Sale Right set forth in\nthis Agreement shall terminate and be of no further force and effect\nimmediately upon the earliest of:\n\n                 (a)      the closing of an initial firm commitment\nunderwritten public offering of the Company's Common Stock pursuant to an\neffective registration statement on Form S-1 under the Securities Act of 1933\ncovering the offer and sale of Common Stock by the Company to the public at an\naggregate offering price of at least $7,500,000 and a per share offering price\nto the public at least equal to twenty dollars ($20.00) (appropriately adjusted\nto reflect any stock split, stock dividend or recapitalization of the Company);\n\n                 (b)      the acquisition of all or substantially all the\nassets or stock of the Company or the merger of the Company with or into any\nother entity in which a change of control of the Company occurs; or\n\n                 (c)      five years after the date of this Agreement.\n\n                                   SECTION 2\n\n                              PROHIBITED TRANSFERS\n\n         2.1     Treatment of Prohibited Transfers.  In the event a Founder\nsells any Co-Sale Securities of the Company in contravention of the\nparticipation rights of the Investors under\n\n\n\n                                      -2-\n\nthis Agreement (a 'Prohibited Transfer'), the Investors, in addition to such\nother remedies as may be available at law, in equity or hereunder, shall have\nthe put option provided in Section 2.2 below, and the Founder shall be bound by\nthe applicable provisions of such put option.\n\n         2.2     Put Option.  In the event of a Prohibited Transfer, each\nInvestor shall have the right to sell to the Founder who effected the\nProhibited Transfer, and, if such right is exercised, the Founder shall have\nthe obligation to purchase from each Investor, a number of shares of Common\nStock of the Company (either directly or through delivery of convertible Series\nA Preferred Stock) equal to the number of shares each Investor would have been\nentitled to transfer to the purchaser in the Prohibited Transfer pursuant to\nthe terms hereof.  Such sale shall be made on the following term and\nconditions:\n\n                 (a)      The price per share at which the shares are to be\nsold to the Founder shall be equal to the price per share paid by the purchaser\nto the Founder in the Prohibited Transfer.  The Founder shall also reimburse\neach Investor for any and all fees and expenses, including legal fees and\nexpenses, promptly following demand therefor, incurred pursuant to the exercise\nor the attempted exercise of the Investor's rights under this Section 2.\n\n                 (b)      In order to exercise the put option created under\nthis Section 2, an Investor must, within 20 days after the later of the date on\nwhich the Investor (i) received notice from the Founder of the Prohibited\nTransfer or (ii) otherwise become aware of the Prohibited Transfer, deliver to\nthe Founder the certificate or certificates representing shares to be sold,\neach certificate to be properly endorsed for transfer.\n\n                 (c)      The Founder shall, upon receipt of the certificate or\ncertificates for the shares to be sold by an Investor, pursuant to Section\n2.2(b), immediately pay the aggregate purchase price therefor and the amount of\nreimbursable fees and expense, as specified in Section 2.2(a), by certified\ncheck or bank draft made payable to the order of such Investor.\n\n                 (d)      NOTWITHSTANDING THE FOREGOING, ANY ATTEMPT TO\nTRANSFER SHARES OF THE COMPANY IN VIOLATION OF ARTICLE I HEREOF SHALL BE VOID\nAND THE COMPANY AGREES IT WILL NOT EFFECT SUCH A TRANSFER NOR WILL IT TREAT ANY\nALLEGED TRANSFEREE AS THE HOLDER OF SUCH SHARES WITHOUT THE WRITTEN CONSENT OF\nTHE INVESTORS.  THE COMPANY AND THE FOUNDER AGREE THAT ANY AND ALL CERTIFICATES\nREPRESENTING ANY SHARES OR OTHER SECURITIES OF THE COMPANY HELD FROM TIME TO\nTIME DURING THE TERM OF THIS CO-SALE AGREEMENT SHALL BEAR A LEGEND REFERRING TO\nTHE RESTRICTIONS IMPOSED BY THIS AGREEMENT.\n\n\n\n\n\n                                     -3-\n\n\n                                   SECTION 3\n\n                                 MISCELLANEOUS\n\n         3.1     Governing Law.  This Agreement shall be governed in all\nrespects by and construed in all respects in accordance with the laws of the\nState of Washington.\n\n         3.2     Successors and Assigns.  Except as otherwise expressly\nprovided herein, the provisions hereof shall inure to the benefit of, and be\nbinding upon, the successors, assigns, heirs, transferees, executors and\nadministrators of the parties hereto.  Nothing in this Agreement, express or\nimplied, is intended to confer upon any party other than the parties hereto or\ntheir respective successors and assigns any rights, remedies, obligations or\nliabilities under or by reason of this Agreement, except as expressly provided\nin this Agreement.\n\n         3.3     Entire Agreement  This Agreement constitutes the full and\nentire understanding and agreement between the parties with regard to Co-Sale\nrights.\n\n         3.4     Amendment and Waiver.  This Agreement, or any provision\nhereof, may be amended or waived only in writing signed by the Company, the\nFounder and the holders of a majority of the Series A Preferred Stock\n(including any Common Stock then held by the Investors issued upon conversion\nof such Series A Preferred Stock), and any amendment or waiver so approved\nshall be binding upon all the Investors (including any transferee of an\nInvestor).\n\n         3.5     Notices, etc.  All notices and other communications required\nor permitted under this Agreement shall be in writing and shall be mailed by\nregistered or certified mail, postage prepaid, or otherwise delivered by hand\nor by messenger addressed (a) if to an Investor, at such Investor's address set\nforth on the Purchase Agreement, or (b) if to a Founder or to the Company, at\nthe address of the Company's principal executive offices.\n\n         3.6     Severability.  In the event that any provision of this\nAgreement are held to be unenforceable under applicable law, this Agreement\nshall continue in full force and effect without said provision and shall be\nenforceable in accordance with its terms.\n\n         3.7     Titles and Subtitles.  The titles of the sections and\nsubsections of this Agreement are for convenience of reference only and are not\nto be considered in construing this Agreement.\n\n         3.8     Counterparts.  This Agreement may be executed in any number of\nCounterparts, each of which shall be an original, but all of which together\nshall constitute one instrument.\n\n\n\n\n\n                                      -4-\n\n                                                                    \n\n\n\n         IN WITNESS WHEREOF, the parties have executed this agreement as of the\ndate first above written.  AMAZON.COM, INC.\n\n\nBy:      Jeffrey P. Bezos                 \n   --------------------------------------\n         Jeffrey P. Bezos, President and\n         Chief Executive Officer\n\nFOUNDER\n\nJeffrey P. Bezos                 \n-----------------------------------------\nJeffrey P. Bezos\n\n\n\n\n\n                     [SIGNATURE PAGE FOR CO-SALE AGREEMENT]\n\n\n\n\n\n\n                                                                  \n\n\n\n         IN WITNESS WHEREOF, the parties have executed this agreement as of the\ndate first above written.  INVESTORS: KLEINER, PERKINS, CAUFIELD &amp; BYERS VIII\n\nBy:      L. John Doerr                 \n   -------------------------------------\nGeneral Partner of KPCB VIII\nAssociates, the General Partner of\nKleiner, Perkins, Caufield &amp; Byers VIII\n\nKPCB INFORMATION SCIENCES\n         ZAIBATSU FUND II\n\nBy:      L. John Doerr                 \n   -------------------------------------\nGeneral Partner of KPCB VIII\nAssociates, the General Partner of\nKleiner, Perkins, Caufield &amp; Byers VIII\n\n\n\n\n\n                     [SIGNATURE PAGE FOR CO-SALE AGREEMENT]\n\n\n<\/pre>\n","protected":false},"template":"","meta":{"_acf_changed":false,"_stopmodifiedupdate":true,"_modified_date":"","_cloudinary_featured_overwrite":false},"corporate_contracts_companies":[6645],"corporate_contracts_industries":[9492],"corporate_contracts_types":[9629,9633],"class_list":["post-43796","corporate_contracts","type-corporate_contracts","status-publish","hentry","corporate_contracts_companies-amazoncom-inc","corporate_contracts_industries-retail__books","corporate_contracts_types-securities","corporate_contracts_types-securities__shareholder"],"acf":[],"_links":{"self":[{"href":"https:\/\/corporate.findlaw.com\/legal-api\/wp-json\/wp\/v2\/corporate_contracts\/43796","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/corporate.findlaw.com\/legal-api\/wp-json\/wp\/v2\/corporate_contracts"}],"about":[{"href":"https:\/\/corporate.findlaw.com\/legal-api\/wp-json\/wp\/v2\/types\/corporate_contracts"}],"wp:attachment":[{"href":"https:\/\/corporate.findlaw.com\/legal-api\/wp-json\/wp\/v2\/media?parent=43796"}],"wp:term":[{"taxonomy":"corporate_contracts_companies","embeddable":true,"href":"https:\/\/corporate.findlaw.com\/legal-api\/wp-json\/wp\/v2\/corporate_contracts_companies?post=43796"},{"taxonomy":"corporate_contracts_industries","embeddable":true,"href":"https:\/\/corporate.findlaw.com\/legal-api\/wp-json\/wp\/v2\/corporate_contracts_industries?post=43796"},{"taxonomy":"corporate_contracts_types","embeddable":true,"href":"https:\/\/corporate.findlaw.com\/legal-api\/wp-json\/wp\/v2\/corporate_contracts_types?post=43796"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}