{"id":43915,"date":"2015-09-17T11:25:58","date_gmt":"2015-09-17T16:25:58","guid":{"rendered":"https:\/\/content.findlaw-admin.com\/ability-legal\/contracts\/uncategorized\/series-c-preferred-stockholders-rights-agreement-goto-com-inc.html"},"modified":"2015-09-17T11:25:58","modified_gmt":"2015-09-17T16:25:58","slug":"series-c-preferred-stockholders-rights-agreement-goto-com-inc","status":"publish","type":"corporate_contracts","link":"https:\/\/corporate.findlaw.com\/contracts\/securities\/series-c-preferred-stockholders-rights-agreement-goto-com-inc.html","title":{"rendered":"Series C Preferred Stockholders&#8217; Rights Agreement &#8211; GoTo.com Inc."},"content":{"rendered":"<pre>\n                               SERIES C PREFERRED\n                         STOCKHOLDERS' RIGHTS AGREEMENT\n\n\n         This Series C Preferred Stockholders' Rights Agreement (this\n'AGREEMENT') is made as of July 31, 1998 by and between GoTo.com, Inc., a\nDelaware corporation (the 'COMPANY') and the entities listed on Exhibit A hereto\n(as may be supplemented from time to time as a result of additional issuances of\nSeries C Preferred Stock of the Company) (each an 'INVESTOR' and together, the\n'INVESTORS').\n\n                                    RECITALS\n\n         A. The Company proposes to sell and issue up to nine million seven\nhundred thousand (9,700,000) shares of Series C Preferred Stock in one or more\nclosings pursuant to that certain Series C Preferred Stock Purchase Agreement\n(the 'PURCHASE AGREEMENT') dated of even date herewith;\n\n         B. As a condition of entering into the Purchase Agreement, the\nInvestors have requested that the Company extend to them registration rights and\nother rights with respect to the Series C Preferred Stock as set forth below.\n\n         NOW, THEREFORE, in consideration of the mutual promises and covenants\nhereinafter set forth, the parties hereto agree as follows:\n\n         1. Certain Definitions. As used in this Agreement, the following terms\nshall have the following respective meanings:\n\n                  'COMMISSION' means the Securities and Exchange Commission or\nany successor agency.\n\n                  'COMMON STOCK' means the Common Stock of the Company.\n\n                  'FAMILY MEMBER' has the meaning set forth for it in Section 4.\n\n                  'HOLDER' means any holder of outstanding Registrable\nSecurities (or Series C Preferred Stock convertible into Registrable Securities,\nas the case may be) which have not been sold to the public.\n\n                  'INITIATING HOLDER' means a holder or holders of more than\nforty percent (40%) of Registrable Securities.\n\n                  'PARTIES' means the parties that are signatories of this\nAgreement; 'PARTY' shall refer to any one of the Parties.\n\n                  'QUALIFIED PUBLIC OFFERING' has the meaning set forth for it\nin Section 5(a).\n\n                  'RESTRICTED SECURITIES' means the securities of the Company\ndescribed in Section 3 hereof.\n\n\n\n\n\n\n                  'REGISTRABLE SECURITIES' means (i) shares of the Common Stock\nissued or issuable upon the conversion of the Series C Preferred Stock; and (ii)\nany other shares of the Company's Common Stock issued as (or issuable upon\nconversion or exercise of any warrant, right or other security which is issued\nas) a dividend or other distribution with respect to or in exchange for or\nreplacement of the Series C Preferred Stock.\n\n         The terms 'register,' 'registered' and 'registration' refer to a\nregistration effected by preparing and filing a registration statement in\ncompliance with the Securities Act, and the declaration or ordering of the\neffectiveness of such registration statement.\n\n                  'REGISTRATION EXPENSES' means all reasonable out-of-pocket\nexpenses incurred by the Company in complying with Sections 5 and 8 hereof,\nincluding, without limitation, all registration, qualification and filing fees,\nprinting expenses, escrow fees, fees and disbursements of counsel for the\nCompany, blue sky fees and expenses, and accounting fees of the Company.\n\n                  'SECURITIES ACT' means the Securities Act of 1933, as amended.\n\n                  'SELLING EXPENSES' means all underwriting discounts, selling\ncommissions and stock transfer taxes applicable to the securities registered by\nthe Holders.\n\n                  'SERIES C PREFERRED STOCK' means the Series C Preferred Stock\nof the Company.\n\n         2. Restrictions on Transferability. The Restricted Securities shall not\nbe transferable except upon the conditions specified in this Agreement\n(including, without limitation, the provisions of Sections 4 and 17), which\nconditions are intended, among other things, to ensure compliance with the\nprovisions of the Securities Act and other provisions. Each holder of Restricted\nSecurities will cause any proposed transferee of the Restricted Securities held\nby such holder to agree in writing to take and hold such Restricted Securities\nin accordance with the restrictions, obligations and conditions specified in\nthis Agreement (including, without limitation, the provisions of Sections 2, 3,\n4, 11, 12 and 17) and to be bound by this Agreement in the same manner as the\ntransferring holder.\n\n         3. Restrictive Legend. Each certificate representing (i) shares of\nSeries C Preferred Stock, (ii) shares of Common Stock issued upon conversion of\nthe Series C Preferred Stock, and (iii) any other securities issued in respect\nof the Series C Preferred Stock and Common Stock issued upon conversion of the\nSeries C Preferred Stock (any such securities listed in the preceding\nsubsections (i), (ii) or (iii), 'RESTRICTED SECURITIES), shall (unless otherwise\npermitted by the provisions of Section 4 below) be stamped or otherwise\nimprinted with a legend in the following form (in addition to any legend\nrequired under applicable state securities laws):\n\n         THE SHARES REPRESENTED BY THIS CERTIFICATE HAVE BEEN ACQUIRED FOR\n         INVESTMENT AND HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF\n         1933, AS AMENDED (THE 'SECURITIES ACT'). THESE SHARES MAY NOT BE SOLD\n         OR TRANSFERRED IN THE ABSENCE OF SUCH REGISTRATION OR AN EXEMPTION\n         THEREFROM UNDER THE SECURITIES\n\n\n                                      -2-\n\n\n\n\n\n\n         ACT. COPIES OF THE AGREEMENTS COVERING THE PURCHASE OF THESE SHARES AND\n         RESTRICTING THEIR TRANSFER MAY BE OBTAINED AT NO COST BY WRITTEN\n         REQUEST MADE BY THE HOLDER OF RECORD OF THIS CERTIFICATE TO THE\n         SECRETARY OF THE CORPORATION AT THE PRINCIPAL EXECUTIVE OFFICES OF THE\n         CORPORATION.\n\n         4. Notice of Proposed Transfers. The holder of each certificate\nrepresenting Restricted Securities by acceptance thereof agrees to comply in all\nrespects with the provisions of this Section 4. Prior to any proposed transfer\nof any Restricted Securities, unless there is in effect a registration statement\nunder the Securities Act covering the proposed transfer, the holder thereof\nshall give written notice to the Company of such holder's intention to effect\nsuch transfer. Each such notice shall describe the manner and circumstances of\nthe proposed transfer in sufficient detail, and shall, if the Company so\nrequests, be accompanied (except in transactions in compliance with Rule 144) by\nan unqualified written opinion of legal counsel who shall be reasonably\nsatisfactory to the Company, addressed to the Company and reasonably\nsatisfactory in form and substance to the Company's counsel, to the effect that\nthe proposed transfer of the Restricted Securities may be effected without\nregistration under the Securities Act, provided, however, that no opinion need\nbe obtained with respect to a transfer to (A) a partner, active or retired, of a\nholder of Restricted Securities, (B) the estate of any such partner, (C) an\n'affiliate' of a holder of Restricted Securities as that term is defined in Rule\n405 promulgated by the Commission under the Securities Act (an 'AFFILIATE'), or\n(D) to the spouse, children, grandchildren or spouse of such children or\ngrandchildren of any holder or to trusts for the benefit of any Holder or such\npersons where the holder is a natural person (each person or entity in this\nsubsection (D), a 'FAMILY MEMBER'), if the transferee agrees to be subject to\nthe terms hereof. Each certificate evidencing the Restricted Securities\ntransferred as above provided shall bear the appropriate restrictive legend set\nforth in Section 3 above, except that such certificate shall not bear such\nrestrictive legend if in the opinion of counsel for the Company such legend is\nnot required in order to establish compliance with any provisions of the\nSecurities Act.\n\n         5. Company Registration.\n\n                  (a) Notice of Registration. After the first firmly\nunderwritten public offering (i) which is pursuant to an effective registration\nstatement under the Securities Act covering the offer and sale of Common Stock\nand (ii) in which the anticipated proceeds from such offering equals or exceeds\n$5,000,000, (such offering a 'QUALIFIED PUBLIC OFFERING') if the Company shall\ndetermine to register any of its securities, either for its own account or the\naccount of a security holder, other than (A) a registration relating to employee\nbenefit plans or, (B) a registration relating to a Commission Rule 145 or\nsimilar transaction, the Company will:\n\n                             (i) promptly give to each Holder written notice \nthereof; and\n\n                            (ii) include in such registration (and any related\nqualification under blue sky laws or other compliance), and in any underwriting\ninvolved therein, all the Registrable Securities\n\n\n                                       -3-\n\n\n\n\n\nspecified in a written request or requests, made within thirty (30) days after\nreceipt of such written notice from the Company, by any Holder, except as set\nforth in Section 5(b) below.\n\n                  (b) Underwriting. If the registration of which the Company\ngives notice is for a registered public offering involving an underwriting, the\nCompany shall so advise the Holders as a part of the written notice given\npursuant to Section 5(a)(i). In such event the right of any Holder to\nregistration pursuant to Section 5 shall be conditioned upon such Holder's\nparticipation in such underwriting and the inclusion of such Holder's\nRegistrable Securities in the underwriting to the extent provided herein. All\nHolders proposing to distribute their securities through such underwriting shall\n(together with the Company and other holders distributing their securities\nthrough such underwriting) enter into an underwriting agreement in customary\nform with the underwriter or underwriters selected for such underwriting by the\nCompany. Notwithstanding any other provision of this Section 5, if the managing\nunderwriter advises the Company in writing that marketing factors require a\nlimitation of the number of shares to be underwritten, then the managing\nunderwriter may limit to whatever extent necessary (including the complete\nexclusion of all Registrable Securities) the number of Registrable Securities to\nbe included in the registration and underwriting by reducing the number of\nRegistrable Securities included on behalf of the Holders, on a pro-rata basis\nbased on the total number of Registrable Securities entitled to registration\nheld by each Holder. The Company shall advise all Holders of Registrable\nSecurities which would otherwise be registered and underwritten pursuant hereto\nof any such limitations. If any Holder disapproves of the terms of any such\nunderwriting, he may elect to withdraw therefrom by written notice to the\nCompany and the underwriter. Any Registrable Securities excluded or withdrawn\nfrom such underwriting shall not be included in such registration. To facilitate\nthe allocation of shares in accordance with the above provisions, the Company or\nthe underwriters may round the number of shares allocated to any Initiating\nHolder or Other Holder to the nearest one hundred (100) shares.\n\n         6. Expenses of Registration. All Registration Expenses incurred in\nconnection with any registration, qualification or compliance pursuant to\nSections 5 and 8 shall be borne by the Company. All Selling Expenses relating to\nsecurities registered by the Holders shall be borne by the Holders of such\nsecurities pro rata on the basis of the number of shares so registered.\n\n         7. Registration Procedures. In the case of each registration,\nqualification or compliance effected by the Company pursuant to this Agreement,\nthe Company will keep each Holder advised in writing as to the initiation of\neach registration, qualification and compliance and as to the completion\nthereof. At its expense the Company will:\n\n                  (a) Effectiveness. Prepare and file with the Commission a\nregistration statement with respect to such securities and use its best efforts\nto cause such registration statement to become and remain effective for at least\nthirty (30) days or until the distribution described in the registration\nstatement has been completed; provided, however, that such thirty (30) day\nperiod shall be extended for a period of time equal to the period the Holder\nrefrains from selling any securities included in such \n\n\n                                       -4-\n\n\n\nregistration at the request of an underwriter of Common Stock (or other\nsecurities) of the Company or the Company;\n\n                  (b) Amendments. Prepare and file with the Commission such\namendments and supplements to such registration statement and the prospectus\nused in connection with such registration statement as may be necessary to\ncomply with the provisions of the Securities Act with respect to the disposition\nof all securities covered by such registration statement;\n\n                  (c) Copies of Documents. Furnish to the Holders participating\nin such registration and to the underwriters of the securities being registered\nsuch reasonable number of copies of the registration statement, preliminary\nprospectus, final prospectus and such other documents as such underwriters or\nsuch Holders may reasonably request in order to facilitate the public offering\nof such securities;\n\n                  (d) Blue Sky Laws. Use its best efforts to register and\nqualify the securities covered by such registration statement under such other\nsecurities or blue sky laws of such jurisdictions as shall be reasonably\nrequested by the Holders; provided that the Company shall not be required in\nconnection therewith or as a condition thereto to qualify to do business or to\nfile a general consent to service of process in any such states or\njurisdictions, unless the Company is already subject to service in such\njurisdiction and except as may be required by the Securities Act;\n\n                  (e) Underwriting Agreement. In the event of any underwritten\npublic offering, enter into and perform its obligations under an underwriting\nagreement, in usual and customary form, with the managing underwriter of such\noffering; provided that each Holder participating in such underwriting shall\nalso enter into and perform its obligations under such underwriting agreement;\n\n                  (f) Notification. Notify each Holder of Registrable Securities\ncovered by such registration statement at any time when a prospectus relating\nthereto is required to be delivered under the Securities Act of the happening of\nany event as a result of which the prospectus included in such registration\nstatement, as then in effect, includes an untrue statement of material fact or\nomits to state a material fact required to be stated therein or necessary to\nmake the statements therein not misleading in the light of the circumstances\nthen existing;\n\n                  (g) Listing. Cause such Registrable Securities registered\npursuant hereunder to be listed on each securities exchange on which similar\nsecurities issued by the Company are then listed; and\n\n                  (h) Transfer Agent and Registrar. Provide a transfer agent and\nregistrar for all Registrable Securities registered pursuant hereunder and a\nCUSIP number for all such Registrable Securities, in each case not later than\nthe effective date of such registration.\n\n         8. Registration on Form S-1 or S-3. If, following the date that is one\n(1) year following a Qualified Public Offering, the Holders holding at least\nfifty percent (50%) of the total Registrable \n\n\n                                       -5-\n\n\n\nSecurities request in writing that the Company file a registration statement on\nForm S-1 or S-3 (or any successor form(s) thereto) for a public offering of\nshares of Registrable Securities the reasonably anticipated aggregate price to\nthe public of which would exceed two million dollars ($2,000,000) with respect\nto a registration on Form S-1 and five hundred thousand dollars ($500,000) with\nrespect to a registration on Form S-3, and, if applicable, the Company is a\nregistrant entitled to use Form S-3 to register securities for such an offering,\nthe Company shall use its commercially reasonable efforts to cause such shares\nto be registered for the offering on such form (or any successor thereto).\nNotwithstanding the foregoing, the Holders may only request the Company to file\na registration statement on Form S-1, if the Company is not entitled to register\nsecurities using Form S-3. Notwithstanding the foregoing, the Company may delay\nthe filing of a registration statement requested pursuant to this Section 8 once\nin any twelve (12) month period for a period of up to ninety (90) days if the\nCompany's Board of Directors determines that such a filing would not be in the\nbest interest of the Company at the time of the request; provided, however, that\nin the event that holders of Common Stock, which prior to conversion were either\nSeries A Preferred Stock or Series B Preferred Stock of the Company, exercise\ndemand registration rights granted to such holders and such registration is\nunderwritten, and the Holders hereunder exercise piggyback registration rights\nwith respect to such underwriting pursuant to Section 5(b) hereof and such\npiggybacking Holders are not permitted to include all Registrable Securities\nrequested in such underwriting, then the foregoing right of the Company to delay\nshall not be applicable. The Company will promptly give written notice of a\nrequest for the proposed registration to all other Holders and include all\nRegistrable Securities of any Holder or Holders joining in such request as are\nspecified in a written request received by the Company within thirty (30) days\nafter the date of such written notice from the Company. The Company shall be\nrequired to file no more than two (2) such registration statements in the\naggregate, only one of which can be on Form S-1, pursuant to this Section 8.\n\n         9. Termination of Registration Rights. Except as provided elsewhere in\nthis Agreement, the registration rights granted pursuant to this Agreement shall\nterminate (i) as to all Holders on the fifth anniversary of the closing of a\nQualified Public Offering and (ii) as to any Holder, at such time as such Holder\nholds less than one percent (1%) of the total outstanding shares of Common Stock\nof the Company (and is therefore able to sell all of its Registrable Securities\nunder Rule 144 in a three (3) month period) or such Holder is able to sell all\nRegistrable Securities held by it pursuant to Rule 144(k) promulgated under the\nSecurities Act.\n\n        10. Indemnification.\n\n                  (a) Company Indemnification. The Company will indemnify each\nHolder, each of its officers, directors and partners and such Holder's legal\ncounsel and independent accountants, and each person controlling such Holder\nwithin the meaning of Section 15 of the Securities Act, with respect to which\nregistration, qualification or compliance has been effected pursuant to this\nAgreement, and each underwriter, if any, and each person who controls any\nunderwriter within the meaning of Section 15 of the Securities Act, against all\nexpenses, claims, losses, damages and liabilities (or actions in respect\nthereof), including any of the foregoing incurred in settlement of any\nlitigation, arising out of or based \n\n\n\n                                       -6-\n\n\n\non any untrue statement (or alleged untrue statement) of a material fact\ncontained in any registration statement, prospectus, offering circular or other\ndocument, or any amendment or supplement thereto, incident to any such\nregistration, qualification or compliance, or based on any omission (or alleged\nomission) to state therein a material fact required to be stated therein or\nnecessary to make the statements therein, not misleading, or any violation by\nthe Company of any rule or regulation promulgated under the Securities Act\napplicable to the Company and relating to action or inaction required of the\nCompany in connection with any such registration, qualification or compliance,\nand will reimburse each such Holder, each of its officers, directors and\npartners and such Holder's legal counsel and independent accountants, and each\nperson controlling such Holder, each such underwriter and each person who\ncontrols any such underwriter, for any legal and any other expenses reasonably\nincurred in connection with investigating, preparing or defending any such\nclaim, loss, damage, liability or action, provided that the Company will not be\nliable in any such case to the extent that any such claim, loss, damage,\nliability or expense arises out of or is based on any untrue statement or\nomission or alleged untrue statement or omission, made in reliance upon and in\nconformity with written information furnished to the Company by an instrument\nduly executed by such Holder or underwriter and stated to be specifically for\nuse therein.\n\n                  (b) Holder Indemnification. Each Holder will, if Registrable\nSecurities held by such Holder are included in the securities as to which such\nregistration, qualification or compliance is being effected, indemnify the\nCompany, each of its directors and officers and its legal counsel and\nindependent accountants, each underwriter, if any, of the Company's securities\ncovered by such a registration statement, each person who controls the Company\nor such underwriter within the meaning of Section 15 of the Securities Act, and\neach other such Holder, each of its officers and directors and each person\ncontrolling such Holder within the meaning of Section 15 of the Securities Act,\nagainst all claims, losses, damages and liabilities (or actions in respect\nthereof) arising out of or based on any untrue statement (or alleged untrue\nstatement) of a material fact contained in any such registration statement,\nprospectus, offering circular or other document, or any omission (or alleged\nomission) to state therein a material fact required to be stated therein or\nnecessary to make the statements therein not misleading, and will reimburse the\nCompany, such Holders, such directors, officers, legal counsel, independent\naccountants, underwriters or control persons for any legal or any other expenses\nreasonably incurred in connection with investigating or defending any such\nclaim, loss, damage, liability or action, in each case to the extent, but only\nto the extent, that such untrue statement (or alleged untrue statement) or\nomission (or alleged omission) is made in such registration statement,\nprospectus, offering circular or other document in reliance upon and in\nconformity with written information furnished to the Company by an instrument\nduly executed by such Holder and stated to be specifically for use therein;\nprovided, however, that the obligations of any such Holder hereunder shall be\nlimited to an amount equal to the gross proceeds before expenses and commissions\nto such Holder of Registrable Securities sold as contemplated herein.\n\n                  (c) Notification of Claim. Each party entitled to\nindemnification under this Section 10 (the 'INDEMNIFIED PARTY') shall give\nnotice to the party required to provide indemnification (the 'INDEMNIFYING\nPARTY') promptly after such Indemnified Party has actual knowledge of any claim\nas to which indemnity may be sought, and shall permit the Indemnifying Party to\nassume the defense of \n\n\n                                       -7-\n\n\n\nany such claim or any litigation resulting therefrom, provided that counsel for\nthe Indemnifying Party, who shall conduct the defense of such claim or\nlitigation, shall be approved by the Indemnified Party (whose approval shall not\nbe unreasonably withheld), and the Indemnified Party may participate in such\ndefense at such party's expense; provided, however, that the Indemnified Party\n(together with all other Indemnified Parties that may be represented without\nconflict by one counsel) shall have the right to retain one separate counsel,\nwith the fees and expenses to be paid by the Indemnifying Party, if\nrepresentation of such Indemnified Party by the counsel retained by the\nIndemnifying Party would be inappropriate due to actual or potential differing\ninterests between such Indemnified Party and any other party represented by such\ncounsel in such proceeding; and provided further that the failure of any\nIndemnified Party to give notice as provided herein shall not relieve the\nIndemnifying Party of its obligations under this Agreement, except to the\nextent, but only to the extent, that the Indemnifying Party's ability to defend\nagainst such claim or litigation is impaired as a result of such failure to give\nnotice. No Indemnifying Party, in the defense of any such claim or litigation,\nshall, except with the consent of each Indemnified Party, consent to entry of\nany judgment or enter into any settlement which does not include as an\nunconditional term thereof the giving by the claimant or plaintiff to such\nIndemnified Party of a release from all liability in respect to such claim or\nlitigation.\n\n                  (d) Contribution. If the indemnification provided for in\nparagraphs (a) and (b) of this Section 10 is unavailable or insufficient to hold\nharmless an Indemnified Party thereunder, then each Indemnifying Party\nthereunder shall contribute to the account paid or payable by such Indemnified\nParty as a result of the losses, claims, damages, costs, expenses, liabilities\nor actions referred to in paragraphs (a) and (b) of this Section 10 in such\nproportion as is appropriate to reflect the relative fault of the Indemnifying\nParty on the one hand and the Indemnified Party on the other in connection with\nstatements or omissions which resulted in such losses, claims, damages or\nliabilities, as well as any other relevant equitable considerations. The\nrelative fault shall be determined by reference to, among other things, whether\nthe untrue or alleged untrue statement of a material fact or the omission or\nalleged omission to state a material fact relates to information supplied by the\nIndemnifying Party or the Indemnified Party and the parties' relative intent,\nknowledge, access to information and opportunity to correct or prevent such\nuntrue statements or omission. The parties hereto agree that it would not be\njust and equitable if contributions pursuant to this paragraph (d) of Section 10\nwere to be determined by pro rata or per capita allocation or by any other\nmethod of allocation which does not take account of the equitable considerations\nreferred to in the first sentence of this paragraph (d) of Section 10. The\namount paid by an Indemnified Party as a result of the losses, claims, damages\nor liabilities referred to in the first sentence of this paragraph (d) of\nSection 10 shall be deemed to include any legal or other expenses reasonably\nincurred by such Indemnified Party in connection with investigating or defending\nany action or claim which is the subject of this paragraph (d) of Section 10.\nPromptly after receipt by an Indemnified Party of notice of the commencement of\nany action against such party in respect of which a claim for contribution may\nbe made against an Indemnifying Party under this paragraph (d) of Section 10,\nsuch Indemnified Party shall notify the Indemnifying Party in writing of the\ncommencement thereof if the notice specified in paragraph (c) of this Section 10\nhas not been given with respect to such action; provided that the omission so to\nnotify the Indemnifying Party shall not relieve the Indemnifying Party from any\nliability which it may have to any Indemnified Party otherwise under this\nparagraph (d) \n\n\n                                       -8-\n\n\n\nof Section 10, except to the extent that the Indemnifying Party is actually\nprejudiced by such failure to give notice. The parties hereto agree with each\nother and shall agree with the underwriters of the Common Stock of the Company\npursuant to the terms hereof, if requested by such underwriters, that (a) the\nunderwriters' portion of such contribution shall not exceed the underwriting\ndiscount, commission and other compensation and (b) except for the Company, the\namount of such contribution shall not exceed an amount equal to the proceeds\nreceived by such Indemnifying Party from the sale of securities in the offering\nto which the losses, claims, damages or liabilities of the indemnified parties\nrelate. No person guilty of fraudulent misrepresentation (within the meaning of\nSection 11(f) of the Securities Act) shall be entitled to contribution from any\nperson who was not guilty of such fraudulent misrepresentation.\n\n         11. Lock-up Agreement. In consideration for the Company agreeing to its\nobligations under this Agreement, each Holder of Registrable Securities and each\ntransferee pursuant to Section 15 hereof agrees, in connection with a Qualified\nPublic Offering, upon request of the Company or the underwriters managing such\noffering, not to sell, make any short sale of, loan, grant any option for the\npurchase of, or otherwise dispose of any Registrable Securities or other\nsecurities of the Company (other than those included in the registration)\nwithout the prior written consent of the Company or such underwriters, as the\ncase may be, for such period of time (not to exceed one hundred eighty (180)\ndays) from the effective date of such registration as the Company or the\nunderwriters may specify. Each Holder agrees that the Company may instruct its\ntransfer agent to place stop transfer notations in its records to enforce the\nprovisions of this Section 11.\n\n         12. Information by Holder. The Holder or Holders of Registrable\nSecurities included in any registration shall furnish to the Company such\ninformation regarding such Holder or Holders and the distribution proposed by\nsuch Holder or Holders as the Company may request in writing and as shall be\nrequired in connection with any registration, qualification or compliance\nreferred to in this Agreement.\n\n         13. Rule 144 Reporting. With a view to making available the benefits of\ncertain rules and regulations of the Commission which may at any time permit the\nsale of the Restricted Securities to the public without registration, after such\ntime as a public market exists for the Common Stock of the Company, the Company\nagrees to:\n\n                  (a) Public Information. Make and keep public information\navailable, as those terms are understood and defined in Rule 144 under the\nSecurities Act, at all times after the effective date of the first registration\nunder the Securities Act filed by the Company for an offering of its securities\nto the general public;\n\n                  (b) Filings with SEC. Use its best efforts to then file with\nthe Commission in a timely manner all reports and other documents required of\nthe Company under the Securities Act and the Securities Exchange Act of 1934, as\namended (at any time after it has become subject to such reporting\nrequirements); and\n\n\n\n\n                                       -9-\n\n\n\n                  (c) Compliance Statement. Furnish to Holders of Registrable\nSecurities forthwith upon request, a written statement by the Company as to its\ncompliance with the reporting requirements of Rule 144 (at any time after ninety\n(90) days after the effective date of the first registration statement filed by\nthe Company for an offering of its securities to the general public), and of the\nSecurities Act and the Securities Exchange Act of 1934, as amended (at any time\nafter it has become subject to such reporting requirements), a copy of the most\nrecent annual or quarterly report of the Company, and such other reports and\ndocuments of the Company as a Holder of Registrable Securities may reasonably\nrequest in availing itself of any rule or regulation of the Commission allowing\nsuch Holder to sell any such securities without registration.\n\n         14. Information Rights. Upon request, the Company will furnish to any\nParty, after the end of each fiscal year, unaudited, consolidated balance sheets\nof the Company and its subsidiaries, if any, as of the end of such fiscal year,\nand unaudited, consolidated statements of income and unaudited, consolidated\nstatements of cash flows of the Company and its subsidiaries, if any, for such\nyear, each signed by the principal financial or accounting officer of the\nCompany; provided, however, that such Party first executes a confidentiality\nagreement in a form provided by the Company. The information rights set forth in\nthis Section 14 shall expire upon the closing date of a Qualified Public\nOffering.\n\n         15. Transfer of Registration Rights and Information Rights. The right\ngranted hereunder to cause the Company to register securities or to participate\nin a registration of the Company or to receive information of the Company\npursuant to Section 14 may not be assigned to any transferee or assignee of\nRestricted Securities unless such transferee or assignee receives and thereafter\nholds at least two hundred thousand (200,000) shares of Common Stock issued or\nissuable upon conversion of the Series C Preferred Stock.\n\n         16.  Right to Maintain.\n\n                  (a) General. Until the closing date of a Qualified Public\nOffering, if the Company desires to issue and sell shares of its capital stock\nor rights, options or other securities exercisable for or convertible into\nshares of its capital stock, then the Company shall first notify each Party of\nthe material terms of such proposed sale (such notice, a 'COMPANY ISSUANCE\nNOTICE'). The Company shall then permit each Party to acquire, at the time of\nthe closing of such sale, such number of the shares of capital stock or other\nsecurities as would enable such Party to maintain its percentage of equity\nownership (calculated on a fully diluted basis, assuming the conversion of all\nseries of the Company's Preferred Stock and exercise of all options and other\nrights to acquire Common Stock) in the Company following such issuance at a\nlevel held by it immediately prior to such issuance. The Parties shall each have\nten (10) days after the delivery of any Company Issuance Notice to elect by\nnotice to the Company to purchase such shares or securities at the time of the\nclosing of such sale.\n\n                  (b) Exceptions. The rights set forth in Section 16(a) shall\nnot apply to the issuance of (i) shares or grant of options (including shares\nissuable upon exercise of such options) to any employee, consultant, or director\nof the Company, or banks, building developers or equipment lessors, \n\n\n\n                                      -10-\n\n\n\nunder any Company stock purchase and\/or stock option plans or arrangements\napproved by the Company's Board of Directors, (ii) shares of Common Stock issued\nupon conversion of any series of preferred stock of the Company, (iii) shares of\nthe Company's capital stock or rights, options or other securities issued\npursuant to a stock split of the Common Stock or Company declared dividend, (iv)\nCompany securities (including, without limitation, options, warrants and\npreferred stock) issued in connection with a merger or acquisition or strategic\npartnering or joint venture agreement, (v) Company securities (including,\nwithout limitation, options, warrants and preferred stock) issued to banks,\nlenders, equipment financiers and the like, or (vi) shares of Common Stock sold\nin a Qualified Public Offering.\n\n         17. Right of First Refusal. Prior to the closing date of a Qualified\nPublic Offering, before there can be a valid sale or transfer for consideration\nof any Restricted Securities by any holder thereof, such holder shall first\noffer those Restricted Securities to the Company in the following manner:\n\n                  (a) Notice. The holder of the Restricted Securities shall\ndeliver a written notice to the Company stating the price, terms, and conditions\nof such proposed sale or transfer, the number and type of Restricted Securities\nto be sold or transferred, and his intention to so sell or transfer such\nRestricted Securities. Within thirty (30) days thereafter, the Company shall\nhave the prior right to purchase any and all of the Restricted Securities\noffered at the price and upon the terms and conditions stated in such notice (it\nbeing understood that the Company may assign this right in its sole discretion).\n\n                  (b) Sale. If none or only a part of the Restricted Securities\nin such holder's notice is purchased by the Company (or an assignee of the\nCompany) within a thirty (30) day period from the date of delivery of the notice\nby such holder to the Company, the holder may sell or transfer to any person or\npersons all Restricted Securities referred to in his notice that were not\npurchased by the Company, but only within a period of one hundred twenty (120)\ndays from the date of his first notice; and provided that he shall not sell or\ntransfer such Restricted Securities at a lower price or on terms more favorable\nto the purchaser or transferee than those specified in his notice to the\nCompany. After said one hundred and twenty (120) day period, the foregoing\nprocedure for first offering the Restricted Securities to the Company shall\nagain apply.\n\n                  (c) Restrictions. Any sale or transfer or purported sale or\ntransfer of the Restricted Securities of the Company shall be null and void\nunless the terms, conditions, and provisions of Sections 2, 4 and this Section\n17 are strictly observed and followed.\n\n                  (d) Exception. The Parties expressly acknowledge that a\ndistribution of Restricted Securities by any holder thereof to a Family Member\nor any Affiliate of such holder shall not be considered a 'sale or transfer for\nconsideration' which triggers the rights and obligations described in this\nSection 17.\n\n         18. Moore Capital Investments, Ltd. Observer Right. For so long as the\nInvestors listed on Exhibit A hereto ('MOORE') (together with their Affiliates)\nholds at least fifty percent (50%) of the Series C Preferred Stock originally\nissued to Moore, Moore shall have the right to designate a \n\n\n                                      -11-\n\n\n\n\n\n\nrepresentative (the 'MOORE OBSERVER') to attend all meetings of the Company's\nBoard of Directors (the 'BOARD') (whether in person, telephonic or otherwise) in\na non-voting observer capacity and, in this respect, the Company shall give to\nMoore, concurrently with the members of the Board, and in the same manner,\ncopies of all notices, minutes and consents (the 'BOARD DOCUMENTS') that it\nprovides to its directors and such representative shall agree to hold in\nconfidence and trust all information so provided. The Moore Observer may be\nexcluded from meetings of the Board, or portions thereof, and notwithstanding\nthe foregoing sentence, any Board Documents may be withheld and not delivered to\nMoore, if the Board determines in good faith and for reasonable business\npurposes that it is in the Company's best interest to exclude the Moore Observer\nor withhold Board Documents. The observer right granted pursuant to this Section\n18 shall terminate (i) immediately prior to a Qualified Public Offering or (ii)\nfollowing a Change in Control (as defined in the Restated Certificate).\n\n         19. Governing Law. This Agreement and the legal relations between the\nparties arising hereunder shall be governed by and interpreted in accordance\nwith the laws of the State of California. The parties hereto agree to submit to\nthe exclusive jurisdiction and venue of the United States District Court for the\nNorthern District of California with respect to the breach or interpretation of\nthis Agreement or the enforcement of any and all rights, duties, liabilities,\nobligations, powers, and other relations between the parties arising under this\nAgreement.\n\n         20. Entire Agreement. This Agreement constitutes the full and entire\nunderstanding and agreement between the parties regarding rights to\nregistration. Except as otherwise expressly provided herein, the provisions\nhereof shall inure to the benefit of, and be binding upon, the successors,\nassigns, heirs, executors and administrators of the parties hereto.\n\n         21. Notices, etc. All notices and other communications required or\npermitted hereunder shall be in writing and deemed given on the business day\nfollowing delivery to the recipient in person or by overnight courier service or\nby facsimile (with acknowledgment of transmission), and addressed (a) if to a\nSeries C Preferred Holder, to such holder's address set forth below, or at such\nother address as such holder shall have furnished to the Company in writing, or\nuntil any such holder so furnishes an address to the Company, then to the\naddress of the last holder of such securities who has so furnished an address to\nthe Company, or (b) if to the Company, to its address set forth on the signature\npage of this Agreement, to the attention of the Chief Executive Officer, or at\nsuch other address as the Company shall have furnished to the Holders.\n\n         22. Counterparts. This Agreement may be executed in any number of\ncounterparts, each of which may be executed by less than all of the parties\nhereto, each of which shall be enforceable against the parties actually\nexecuting such counterparts, and all of which together shall constitute one and\nthe same instrument.\n\n         23. Amendment. Any provision of this Agreement may be amended, waived,\nmodified, discharged or terminated only with the written consent of the Company\nand the holders of a majority in interest of the Series C Preferred Stock (or\nCommon Stock issuable upon conversion thereof). Any \n\n\n                                      -12-\n\n\n\namendment or waiver effected in accordance with this paragraph will be binding\nupon the Company and each holder of any securities subject to this Agreement\n(including securities into which such securities are convertible) and future\nholders of all such securities. Any Holder may waive his or her rights or the\nCompany's obligations hereunder without obtaining the consent of any other\nperson.\n\n         24. Successors and Assigns. Except as otherwise provided herein, the\nprovisions hereof shall inure to the benefit of, and be binding upon, the\nsuccessors, assigns, heirs, executors and administrators of the parties hereto.\n\n         25. Severability. In the event that any provision of this Agreement\nbecomes or is declared by a court of competent jurisdiction to be illegal,\nunenforceable or void, this Agreement shall continue in full force and effect\nwithout said provision; provided that no such severability shall be effective if\nit materially changes the economic benefit of this Agreement to any party.\n\n         26. Titles and Subtitles. The titles and subtitles used in this\nAgreement are used for convenience only and are not to be considered in\nconstruing or interpreting this Agreement.\n\n\n                                     * * * *\n\n\n\n                                      -13-\n\n\n\n\n\n         IN WITNESS WHEREOF, the undersigned have executed this Series C\nPreferred Stockholders' Rights Agreement as of the date set forth above.\n\n\n'COMPANY'                           'INVESTOR'\n\nGOTO.COM, INC.                      Moore Global Investments, Ltd.\na Delaware Corporation\n                                    By:     Moore Capital Management, Inc.\n                                    Its:    Trading Advisor\n--------------------------------\nJeffrey Brewer, \nChief Executive Officer\n\n                                    --------------------------------------------\n                                    Savvas Savvinidis\n\n                                    Title:  Director of Operations\n                                    Address: c\/o Citco Fund Services \n                                             (Bahamas), Ltd.\n                                             Bahamas Financial Center\n                                             Charlotte &amp; Shirley Street\n                                             P.O. Box CB  13136\n                                             Nassau, Bahamas\n\n\n\n                                    Multi-Strategies Fund Ltd.\n\n                                    By:     Moore Capital Management, Inc.\n                                    Its:    Trading Advisor\n\n\n                                    --------------------------------------------\n                                    Savvas Savvinidis\n\n                                    Title:  Director of Operations\n                                    Address: c\/o Citco Fund Services \n                                             (Bahamas), Ltd.\n                                             Bahamas Financial Center\n                                             Charlotte &amp; Shirley Street\n                                             P.O. Box CB  13136\n                                             Nassau, Bahamas\n\n\n     [Signature pages to Series C Preferred Stockholders' Rights Agreement]\n\n\n                                      -14-\n\n\n\n\n\n                                    Remington Investment Strategies, L.P.\n\n                                    By:     Moore Capital Advisors, L.L.C.\n                                    Its:    General Partner\n\n                                    --------------------------------------------\n                                    Savvas Savvinidis\n\n                                    Title:  Director of Operations\n                                    Address:    1251 Avenue of the Americas\n                                                New York, NY  10020\n\n\n\n                                    Multi-Strategies Fund, L.P.\n\n                                    By:     Moore Capital Advisors, L.L.C.\n                                    Its:    Trading Advisor\n\n                                    --------------------------------------------\n                                    Savvas Savvinidis\n\n                                    Title:  Director of Operations\n                                    Address:    1251 Avenue of the Americas\n                                                New York, NY  10020\n\n\n     [Signature pages to Series C Preferred Stockholders' Rights Agreement]\n\n\n\n                                      -15-\n\n\n\n\n                                    EXHIBIT A\n\n                                    INVESTORS\n\nMoore Global Investments, Ltd.\nc\/o Citco Fund Services (Bahamas), Ltd.\nBahamas Financial Center\nCharlotte &amp; Shirley Street\nP.O. Box CB  13136\nNassau, Bahamas\n\nMulti-Strategies Fund Ltd.\nc\/o Citco Fund Services (Bahamas), Ltd.\nBahamas Financial Center\nCharlotte &amp; Shirley Street\nP.O. Box CB  13136\nNassau, Bahamas\n\nRemington Investment Strategies, L.P.\n1251 Avenue of the Americas\nNew York, NY  10020\n\nMulti-Strategies Fund, L.P.\n1251 Avenue of the Americas\nNew York, NY  10020\n\nDraper Richards, L.P.\n50 California Street, Suite 2925\nSan Francisco, CA  94111\n\nHughes Family 1998 Revocable Trust\n\nHughes Family 1998 Irrevocable Trust\n\nLarry W. Sonsini\nWilson Sonsini Goodrich &amp; Rosati\n650 Page Mill Road\nPalo Alto, CA  94304\n\nMartin W. Korman\nWilson Sonsini Goodrich &amp; Rosati\n650 Page Mill Road\nPalo Alto, CA  94304\n\n\n                                      -16-\n\n\n\n\n\nGreg Brogger\n130 W. Union Street\nPasadena, CA  91103\n\nWS Investment Company 98B\nWilson Sonsini Goodrich &amp; Rosati\n650 Page Mill Road\nPalo Alto, CA  94304\n\n\n\n                                      -17-\n\n\n\n<\/pre>\n","protected":false},"template":"","meta":{"_acf_changed":false,"_stopmodifiedupdate":true,"_modified_date":"","_cloudinary_featured_overwrite":false},"corporate_contracts_companies":[7665],"corporate_contracts_industries":[],"corporate_contracts_types":[9630,9629],"class_list":["post-43915","corporate_contracts","type-corporate_contracts","status-publish","hentry","corporate_contracts_companies-gotocom-inc","corporate_contracts_types-securities__invest","corporate_contracts_types-securities"],"acf":[],"_links":{"self":[{"href":"https:\/\/corporate.findlaw.com\/legal-api\/wp-json\/wp\/v2\/corporate_contracts\/43915","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=43915"}],"wp:term":[{"taxonomy":"corporate_contracts_companies","embeddable":true,"href":"https:\/\/corporate.findlaw.com\/legal-api\/wp-json\/wp\/v2\/corporate_contracts_companies?post=43915"},{"taxonomy":"corporate_contracts_industries","embeddable":true,"href":"https:\/\/corporate.findlaw.com\/legal-api\/wp-json\/wp\/v2\/corporate_contracts_industries?post=43915"},{"taxonomy":"corporate_contracts_types","embeddable":true,"href":"https:\/\/corporate.findlaw.com\/legal-api\/wp-json\/wp\/v2\/corporate_contracts_types?post=43915"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}