Stockholder and Registration Rights Agreement between Soft Wave Media, Inc. and Stockholders

Summary

This agreement is between Soft Wave Media, Inc. and its stockholders, including both current and future holders of the company's common stock. It sets rules for transferring shares, requiring stockholders to follow specific procedures and obtain approval before selling or transferring their shares. The agreement also grants certain stockholders rights to have their shares registered for public sale, and outlines the process for exercising these rights. The goal is to protect the interests of the company and its stockholders by controlling share transfers and providing a framework for share registration.

EX-10.05 11 ex105to8k06603_07252006.htm sec document
 Exhibit 10.5 STOCKHOLDER AND REGISTRATION RIGHTS AGREEMENT This STOCKHOLDER AND REGISTRATION RIGHTS AGREEMENT, dated as of January 19, 2006, is by and among Soft Wave Media, Inc., a Delaware corporation (the "CORPORATION"), each of the holders of the Corporation's Common Stock (as defined below) as of the date hereof (such holders being set forth on SCHEDULE A hereto) and such additional persons who become holders of the Corporation's Common Stock from and after the date hereof (as set forth on SCHEDULE A hereto, as it may be supplemented from and after the date hereof) (collectively, the "STOCKHOLDERS"). W I T N E S S E T H: WHEREAS, the Stockholders own all of the issued and outstanding shares (the "SHARES") of the Corporation's Common Stock, par value $.01 per share (the "COMMON STOCK"); and WHEREAS, the Stockholders and the Corporation believe that it is in their best interests to impose certain restrictions and obligations with respect to the transfer of the Shares; and WHEREAS, the Stockholders and the Corporation believe that it is in their best interests to set forth certain agreements with respect to the governance of the Corporation; and WHEREAS, the Stockholders and the Corporation believe that it is in their best interests to set forth certain agreements with respect to the registration of the shares of the Corporation. NOW, THEREFORE, in consideration of the premises and mutual covenants set forth herein, it is mutually agreed by and among the parties as follows: 1. DEFINITIONS. As used in this Agreement, unless the context otherwise requires: "AGREEMENT" means this Stockholder and Registration Rights Agreement and any amendments and supplements hereto. "BONA FIDE OFFER" means a written offer from a financially responsible party or parties identified therein by name and address, reasonably appearing able to comply with the terms of such offer. "COMMON STOCK" shall have the meaning set forth in the recitals to this Agreement. "CORPORATION" shall have the meaning set forth in the introduction to this Agreement.  "EFFECTIVE DATE" means the date upon which a Notice of Offer is deemed to have been first delivered to the Corporation. "EXCHANGE ACT" means the Securities Exchange Act of 1934, as amended from time to time, and the rules and regulations of the Securities and Exchange Commission promulgated thereunder. "FOUNDING STOCKHOLDER(S)" means Soft Wave Media, LLC, Alowex, LLC and Remnant Media, LLC. "FOUNDING STOCKHOLDER SHARES" means all shares of Common Stock which are held on the date hereof by the Founding Stockholder(s). "INVESTORS" means those Stockholders set forth on SCHEDULE A hereto, other than Soft Wave Media, LLC. "INVESTOR SHARES" means all shares of Common Stock which are held on the date hereof by the Investors. "NOTICE OF EXERCISE" means the written notice required to be given by the Corporation or a Stockholder to exercise the option to purchase the Shares offered for Transfer. "NOTICE OF OFFER" means the written notice of a Stockholder's intention to Transfer any of his Shares and which sets forth the name of the proposed Transferee, the number of Shares to be Transferred and the terms and conditions of the proposed Transfer. Such notice shall be accompanied by a copy of a Bona Fide Offer received in connection with such proposed Transfer. "PERMITTED TRANSFER" means, in the case of a given Stockholder, a transfer to a Permitted Transferee of such Stockholder. "PERMITTED TRANSFEREE" means (i) in the case of a Founding Stockholder (or any direct or indirect Permitted Transferee of a Founding Stockholder), one or more of the following persons or entities: Soft Wave Media, LLC, Alowex, LLC, Remnant Media, LLC, Josh Wexler, Stavros Aloizos, Michael Caprio, Charles Omphalius, Jay Keay or Larry Gershman, and (ii) in the case of an Investor, any entity in which Robert A. Berman, Scott Kaniewski and/or such Investor, singularly or collectively, owns at least 51% of the outstanding voting securities; PROVIDED, HOWEVER, that no person or entity shall be deemed to be a Permitted Transferee unless such person or entity, in connection with the purported Permitted Transfer to such person or entity, shall execute a counterpart to this Agreement, in form and substance reasonably satisfactory to the Board of Directors of the Corporation, pursuant to which such person or entity agrees to be bound by all of the terms and provisions of this Agreement. "REGISTRABLE HOLDER" means the Founding Stockholder(s), the Investors and any person to whom Registrable Shares are transferred in accordance with the terms of this Agreement (so long as such person holds Registrable Shares).  "REGISTRABLE SHARES" means (i) the Founding Stockholder Shares, (ii) the Investor Shares, and (iii) any shares of Common Stock issued or issuable in respect of such shares upon any stock split, reverse stock split, stock dividend, recapitalization, or similar event; PROVIDED, HOWEVER, as to any particular Registrable Shares, such securities shall cease to be Registrable Shares when (i) such securities shall have been sold pursuant to an effective registration statement under the Securities Act, (ii) such securities can be sold in the public market pursuant to Rule 144 of the Securities Act, without regard to volume limitations, (iii) such securities shall have been otherwise transferred, new certificates for them not bearing a legend restricting further transfer shall have been delivered by the Corporation and subsequent disposition of them shall not require registration under the Securities Act, or (iv) such securities shall have ceased to be outstanding. "SECURITIES ACT" means the Securities Act of 1933, as amended from time to time, and the rules and regulations of the Securities and Exchange Commission promulgated thereunder. "SELLING STOCKHOLDER" means any Stockholder who has delivered a Notice of Offer. "SHARES" means the issued and outstanding shares of the Common Stock of the Corporation. "STOCKHOLDERS" shall have the meaning set forth in the introduction to this Agreement. "TRANSFER" means to directly or indirectly sell, assign, hypothecate, transfer, pledge, mortgage or in any other way encumber or dispose of Shares and shall be defined to include the process whereby Shares are transferred. "TRANSFEREE" means the person or entity to which a Selling Stockholder desires to Transfer Shares. 2. RESTRICTIONS ON TRANSFER OF SHARES. No Stockholder shall Transfer any Shares that he or it may now or hereafter hold, nor shall any such Shares be transferable, except in compliance with the terms of this Agreement and in compliance with all applicable federal and state securities laws. No Transfer of Shares will be recognized by the Corporation unless a registration statement relating thereto has been declared effective under the Securities Act or the Selling Stockholder establishes to the satisfaction of the Corporation that such Transfer of Shares is exempt from registration under the Securities Act and applicable state securities laws.  3. RIGHTS OF FIRST REFUSAL. (a) No less than 21 days prior to any Transfer, other than a Permitted Transfer, a Stockholder desiring to Transfer Shares shall furnish a Notice of Offer to the Corporation and to each other Stockholder. For a period of 7 days after the Effective Date of the Notice of Offer (to the Corporation), the Corporation shall have an option to purchase all or any portion of the Shares offered for Transfer by the Selling Stockholder on the same terms and conditions as set forth in the Notice of Offer. If the Corporation elects to exercise such option, it must deliver to the Selling Stockholder a Notice of Exercise within 7 days of the Effective Date of the Notice of Offer (to the Corporation). (b) If the Corporation elects not to exercise said option for all of the Shares to be Transferred by the Selling Stockholder, then it shall give prompt notice thereof (by courier or other means of personal service or by national overnight delivery service) to the Selling Stockholder and the other Stockholders, after which such other Stockholders will have an option for an additional 7 days to purchase all or any portion of the remaining Shares offered for Transfer by the Selling Stockholder on the same terms and conditions as set forth in the Notice of Offer. If such a Stockholder elects to exercise its option to acquire Shares to be Transferred, it must deliver to the Selling Stockholder a Notice of Exercise within 14 days of the Effective Date of the Notice of Offer (to the Corporation). If more than one such other Stockholder exercises said option, then each such other Stockholder shall have the right to purchase Shares of the Selling Stockholder on a pro rata basis based on the current number of Shares owned by each purchasing Stockholder. (c) The Notice of Exercise delivered by the Corporation or any other Stockholder shall specify a closing date within 21 days after the Effective Date of the Notice of Offer (to the Corporation). The Selling Stockholder and the purchasers may extend the closing date by mutual written consent. (d) If either the Corporation or any other Stockholders elect to exercise their option to purchase all or any portion of the Shares, then the Selling Stockholder may not Transfer such Shares to any other party. If the periods during which the Corporation and the other Stockholders are entitled to exercise their options to purchase such Shares expire without the exercise of said options with respect to any of the Shares so offered, then the Selling Stockholder shall, for a period ending 30 days after the termination of the last applicable option period, be free to Transfer such Shares to the Transferee making the Bona Fide Offer contained in the Notice of Offer, but only so long as such Transfer is effected on terms and conditions no less favorable to the Selling Stockholder as those set forth in the Bona Fide Offer contained in the Notice of Offer. Any Transferee shall, as a condition to the recognition by the Corporation of such Transfer, execute an instrument acceptable to the Corporation acknowledging the terms and restrictions of this Agreement and the Transferee's obligation to be bound hereby and all Shares shall be marked with a legend referencing a restriction on Transfer pursuant to the terms hereof.  (e) If the Selling Stockholder does not Transfer the Shares within the period specified in paragraph (d) hereof, then such Shares shall again become subject to the restrictions of this Agreement. (f) Any Shares purchased by the Corporation shall be restored to the status of authorized but unissued Shares. (g) The Selling Stockholder will be responsible for the payment of any and all expenses incurred by the Selling Stockholder in the exercise of the rights specified in this Section 3 and the sale of his or its Shares. 4. BOARD OF DIRECTORS AND OFFICERS. During the term of this Agreement (as set forth in Section 13), each Stockholder shall vote his Shares and otherwise act so as to cause the Board of Directors of the Corporation (the "BOARD") to be comprised of four persons, constituted as follows: (i) two persons nominated by Alowex, LLC, such persons to initially be Stavros Aloizos and Josh Wexler; and (ii) two persons nominated by Remnant Media, LLC, such persons to initially be Charles Omphalius and Mike Caprio. 5. INCIDENTAL REGISTRATION RIGHTS. (a) If the Corporation proposes to file a registration statement under the Securities Act with respect to a primary or secondary offering of equity securities of the Corporation (other than a registration statement relating solely to (i) securities to be offered to employees pursuant to a stock option, stock savings, or other employee benefit plan of the Corporation or its affiliates; (ii) securities proposed to be issued by the Corporation in exchange for securities or assets of, or in connection with a merger or consolidation with, another corporation; (iii) securities to be offered by the Corporation generally to any class or series of its then-existing security holders; or (iv) securities to be offered or issued pursuant to a combination of the foregoing transactions), then the Corporation shall give written notice of such proposed filing to each Registrable Holder as soon as practicable, and such notice shall offer the opportunity to register all or any part of the Registrable Shares owned by such Registrable Holder. Registrable Holders shall have 15 days following receipt of such notice to request in writing inclusion of their Registrable Shares in such registration, which request shall specify the number of Registrable Shares a Registrable Holder proposes to register. (b) Whenever a Registrable Holder requests that all or part of his Registrable Shares be included in a proposed registration, the Corporation shall use its reasonable best efforts to effect the registration of such Registrable Shares and to cause the managing underwriter of any proposed underwritten offering to permit the requested Registrable Shares to be included in such registration. Registrable Holders may only participate in the underwritten portion of such registration if each of them (i) agrees to sell their Registrable Shares on the basis provided in any underwriting arrangements and (ii) completes and executes all questionnaires, powers of attorney, underwriting agreements and other documents reasonably required under the terms of such underwriting arrangements and these registration rights. Among other things, each Registrable Holder agrees, if his or its Registrable Shares are included in  an underwritten offering, that he or it will, upon the reasonable request of the managing underwriter, join in any general agreement with the managing underwriter not to effect any public sale or distribution of his or its remaining Registrable Shares pursuant to such registration for a period of time not to exceed 180 days after the date any such registration statement is declared effective under the Securities Act. (c) Notwithstanding anything else set forth in paragraph (a) of this Section 5, the Corporation may, at the discretion of a majority of its Board of Directors and without the consent of any requesting Registrable Holder, withdraw any registration and abandon the proposed offering. Furthermore, if the managing underwriter of an underwritten offering advises the Corporation that in its opinion either because of (i) the size of the offering that the Corporation and any Registrable Holders desire to make or (ii) the kind of securities that the Corporation and any Registrable Holders intend to include in such offering, the success of the offering could be materially and adversely affected by inclusion of the Registrable Shares requested to be included, then (A) in the event that the size of the offering is the basis of such managing underwriter's opinion, the amount of Registrable Shares to be offered for the account of Registrable Holders shall be reduced on a pro rata basis among such Registrable Holders (on the basis of the amount of Registrable Shares intended to be included in such registration by each such Registrable Holder as compared to the aggregate amount of Registrable Shares intended to be included by all such Registrable Holders) to the extent necessary to reduce the total amount of Registrable Shares to be included in such offering to the amount recommended by such managing underwriter; and (B) in the event that the kind or combination of securities to be offered is the basis of such managing underwriter's opinion, the amount of Registrable Shares to be included in such offering shall be reduced as described in clause (A) above or, if any such reduction would, in the judgment of the managing underwriter, be insufficient to substantially eliminate the adverse effect that inclusion of the Registrable Shares requested to be included could have on such offering, such Registrable Shares shall be excluded from such underwritten offering. Notwithstanding the exclusion of such Registrable Shares from such underwritten offering, the Corporation will cause such Registrable Shares to be registered for resale in the same registration statement, provided that the requesting Registrable Holders agree not to consummate any such resale of their Registrable Shares pursuant to such registration statement for a period of 180 days after such registration statement is declared effective under the Securities Act. The Corporation agrees to maintain the effectiveness of such registration statement under the Securities Act for up to 12 months after such 180-day period has expired or until all such registered Registrable Shares are sold, whichever is earlier. (d) The registration rights under this Section 5 shall only apply to the first three registration statements filed by the Corporation and declared effective under the Securities Act, other than registration statements relating to those offerings described in items (i) through (iv) of paragraph (a) of this Section 5.  6. ADDITIONAL REGISTRATION RIGHTS. (a) If at any time (1) the Corporation shall receive from any one or more Registrable Holders of Registrable Shares a written request that the Corporation effect a registration of all or any portion of such Registrable Shares on Form S-3 or any successor thereto, (2) the reasonably anticipated proceeds from such Registrable Shares shall be at least $1,500,000, and (3) the Corporation is a registrant entitled to use Form S-3 or any successor thereto to register such shares, the Corporation will: (i) promptly give written notice of the proposed registration to all Registrable Holders; and (ii) use its reasonable best efforts to effect, as soon as reasonably practicable, such registration as may be so requested and as would permit or facilitate the sale and distribution of all or such portion of such Registrable Holder's or Registrable Holders' Registrable Shares as are specified in such request, together with all or such portion of the Registrable Shares of any Registrable Holder or Registrable Holders of Registrable Shares joining in such request as are specified in a written request given within fifteen (15) days after receipt of such written notice from the Company. (b) Notwithstanding any other provision of this Section 6, if the contemplated distribution pursuant to this Section 6 shall be by means of an underwriting and if the underwriter advises the holders of Registrable Shares initiating the registration request ("INITIATING HOLDER(S)") that marketing factors require a limitation of the number of shares to be underwritten, then the Initiating Holder(s) shall so advise all Registrable Holders whose Registrable Shares would otherwise be underwritten pursuant hereto, and the number of Registrable Shares that may be included in the underwriting shall be allocated among such Registrable Holders on the basis of the amount of Registrable Shares intended to be included in such registration by each such Registrable Holder as compared to the aggregate amount of Registrable Shares intended to be included by all such Registrable Holders; provided that the Company may accommodate the request of any such Holder that it be allowed to withdraw as a whole or in part from such offering. (c) The Corporation shall not, pursuant to Section 6(a), be obligated to (i) complete more than three such registrations, or (ii) effect more than one such registration per 180-day period; PROVIDED, HOWEVER, that a registration shall not be counted as a registration under this Section 6 unless such registration statement shall include at least thirty percent (30%) of the Registrable Shares for which such registration has been requested; and PROVIDED FURTHER, that if the Initiating Holders withdraw their request for registration during a deferral period under Section 6(d) hereof, such withdrawal request shall not be counted towards the number of S-3 registrations permitted hereunder. (d) Notwithstanding the foregoing, if the Corporation shall furnish to the holders requesting a registration statement pursuant to this Section 6, within 30 days of such request, a certificate signed by the President of the Corporation stating that in good faith judgment of the Board of Directors of the  Corporation, it would be seriously detrimental to the Corporation and its stockholders for such registration statement to be filed and it is therefore essential to defer the filing of such registration statement, the Corporation shall have the right to defer taking action with respect to such filing for a period of not more than 180 days after receipt of the request of the Initiating Holders. During any such deferral period, the Initiating Holders may withdraw their request, in which case the Initiating Holders will not have been deemed to have made a request for registration under this Section 6. 7. REGISTRATION PROCEDURES. (a) The Corporation shall pay all of its expenses in connection with the registration of Registrable Shares pursuant to Section 5 or Section 6, including expenses incurred in connection with any registration statements that do not become effective. Registrable Holders participating in such registration shall pay their pro rata share of all underwriting fees, discounts or commissions attributable to any sale of all or part of their Registrable Shares in connection with any registration, and shall be required to pay expenses that they incur for their own attorneys or advisors in connection with the registration, but shall not be required to cover other expenses of the registration contracted for by the Corporation. A Registrable Holder's pro rata share of such underwriting fees, discounts or commissions will be determined by reference to the number of shares to be sold by such Registrable Holder compared with the number of shares to be sold by all Registrable Holders and the Corporation pursuant to the registration. (b) Whenever the Corporation files a registration statement pursuant to Section 5 or Section 6 that is declared effective and that registers any Registrable Shares for resale, the Corporation agrees to use its best efforts to register or qualify the Registrable Shares for sale in those states requested by the person selling the Registrable Shares; PROVIDED THAT, the Corporation shall not be required to (i) register or qualify the Registrable Shares for sale in any state in which the sale of the Registrable Shares by the person selling the Registrable Shares would be exempt from having to be registered or qualified in such state; (ii) qualify as a foreign corporation to do business under the laws of any such jurisdiction; (iii) take any action that would subject it to annual service of process in any jurisdiction in which it is not so subject; or (iv) take any action that would subject it to the assessment of taxes in any jurisdiction in which it is not so subject. (c) If, subsequent to the effectiveness of a registration statement described in the foregoing provisions of Section 5 or Section 6, (i) the Corporation determines that there are material developments relating to the Corporation that require the filing of a post-effective amendment to the registration statement, then each Registrable Holder shall refrain from selling any Registrable Shares until such post-effective amendment is declared effective or (ii) a stop order has been issued against the registration statement, each Registrable Holder shall refrain from selling any Registrable Shares until such Registrable Holder is notified by the Corporation that the stop order has been withdrawn.  (d) In connection with any registration under Section 5 or Section 6: (i) The Corporation shall indemnify each Registrable Holder against any loss, claim, damage, expense or liability (including all expenses reasonably incurred in investigating, preparing or defending against any claim whatsoever) to which he or it may become subject under the Securities Act, the Exchange Act or any other statute, common law or otherwise, arising out of or based upon any untrue statement or alleged untrue statement of a material fact contained in such registration statement or based upon written information furnished by the Corporation filed in any jurisdiction in order to qualify the Registrable Shares under the securities laws thereof or filed with the Securities and Exchange Commission, any state securities commission or agency, the National Association of Securities Dealers, Inc., The Nasdaq Stock Market or any securities exchange, or the omission or alleged omission therefrom of a material fact required to be stated therein or necessary to make the statements contained therein not misleading, unless such statement or omission was made in reliance upon and in conformity with written information furnished to the Corporation by such Registrable Holder expressly for use in or intended to be relied upon for such registration statement, any amendment or supplement thereto or any application, as the case may be. If any action is brought against a Registrable Holder in respect of which indemnity may be sought against the Corporation pursuant to this Section 7(d)(i), such Registrable Holder shall, within thirty (30) days after the receipt of a summons or complaint, notify the Corporation in writing of the institution of such action and the Corporation shall assume the defense of such action, including the employment and payment of reasonable fees and expenses of counsel of recognized standing (which shall include counsel serving as the Corporation's outside general counsel), but the failure to give such notice shall not affect such indemnified person's right to indemnification hereunder except to the extent that the Corporation's defense of such action was materially adversely affected thereby. Each Registrable Holder shall have the right to employ his or her own counsel in any such case, but the fees and expenses of such counsel shall be borne by such Registrable Holder unless the employment of such counsel is authorized in writing by the Corporation in connection with the defense of such action, the Corporation fails to employ counsel to handle the defense of such action or such indemnified party reasonably concludes that there may be defenses available to him or it that are different from or additional to those available to the Corporation (in which case the Corporation shall not have the right to direct the defense of such action on behalf of the indemnified party or parties), in any of which events the fees and expenses of not more than one additional firm of attorneys for such Registrable Holders shall be borne by the Corporation. Except as expressly provided in the previous sentence, in the event that the Corporation shall have assumed the defense of any such action or claim, the Corporation shall not thereafter be liable to any Registrable Holder in investigating, preparing or defending any such action or claim. The Corporation agrees to promptly notify each Registrable Holder of the commencement of any litigation or proceeding against the Corporation or any of its officers, directors or controlling persons in  connection with the resale of the Registrable Shares or in connection with such registration statement. (ii) Each Registrable Holder shall severally, but not jointly, indemnify the Corporation, its officers and directors and each person, if any, who controls the Corporation within the meaning of Section 15 of the Securities Act or Section 20(a) of the Exchange Act, against any loss, claim, damage, expense or liability (including all expenses reasonably incurred in investigating, preparing or defending against any claim whatsoever) to which it or they may become subject under the Securities Act, the Exchange Act or otherwise, arising from written information furnished by or on behalf of such Registrable Holder expressly for use in or intended to be relied upon for such registration statement. (iii) If for any reason the foregoing indemnity is unavailable, or is insufficient to hold harmless an indemnitee, then the indemnifying party shall contribute to the amount paid or payable by the indemnitee as a result of such loss, claim, damage, expense or liability (i) in such proportion as is appropriate to reflect the relative benefits received by the indemnifying party on the one hand and the indemnitee on the other from the registration or (ii) if the allocation provided by clause (i) above is not permitted by applicable law, or provides a lesser sum to the indemnitee than the amount hereinafter calculated, in such proportion as is appropriate to reflect not only the relative benefits received by the indemnifying party on the one hand and the indemnitee on the other but also the relative fault of the indemnifying party and the indemnitee as well as any other relevant equitable considerations. No person guilty of fraudulent misrepresentation (within the meaning of Section 11(f) of the Securities Act) shall be entitled to contribution from any person who was not guilty of such fraudulent misrepresentation. 8. LEGEND. Each certificate representing Shares shall have the following legend printed or typed thereon, for so long as such legend shall be applicable: "THE SECURITIES EVIDENCED HEREBY HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE "ACT"), OR ANY STATE SECURITIES LAWS. THEY MAY NOT BE SOLD OR OFFERED FOR SALE IN THE ABSENCE OF AN EFFECTIVE REGISTRATION STATEMENT AS TO THE APPLICABLE SECURITIES UNDER THE ACT AND ANY STATE SECURITIES LAWS OR PURSUANT TO AN EXEMPTION FROM REGISTRATION." "THE SECURITIES EVIDENCED HEREBY ARE SUBJECT TO A CERTAIN STOCKHOLDER AND REGISTRATION RIGHTS AGREEMENT, DATED AS OF JANUARY 19, 2006, BY AND AMONG THE CORPORATION AND THE STOCKHOLDER PARTIES THERETO, A COPY OF WHICH MAY BE OBTAINED FROM THE SECRETARY OF THE CORPORATION AT THE PRINCIPAL OFFICES OF THE CORPORATION."  Each certificate representing Shares shall also have any other legends required by applicable state or federal securities laws or any applicable state laws regulating the Corporation's business. All Shares hereafter issued shall bear the same legend. 9. NOTICES. All notices, requests and other communications hereunder shall be in writing and shall be delivered by courier or other means of personal service, national overnight delivery service, or certified U.S. mail, return receipt requested, addressed (i) to the Corporation at One Bridge Street, Suite 56, Irvington, NY 10533, attention: Josh Wexler, or (ii) to a Stockholder at the address set forth in SCHEDULE A hereto or at such other address of which a Stockholder has given the Corporation notice. All such notices shall be deemed to have been delivered on the date personally delivered, one business day after being delivered to a national overnight delivery service or five business days after being deposited in the U.S. Mail. 10. WAIVER. No waiver of any provision of this Agreement in any instance shall be or for any purpose be deemed to be a waiver of the right of any party hereto to enforce strict compliance with the provisions hereof in any subsequent instance. 11. GOVERNING LAW. This Agreement shall be construed and interpreted in accordance with the laws of the State of Delaware without giving effect to its conflict of laws principals. 12. BINDING EFFECT AND BENEFITS. Except as otherwise provided herein, the terms of this Agreement shall be binding upon the parties hereto and their respective heirs, executors, administrators, personal representatives, successors and assigns, and shall be binding upon any person to whom any of the Shares of the parties are transferred and upon the heirs, executors, administrators, personal representatives, successors and assigns of each such person. 13. TERM OF AGREEMENT. This Agreement shall become effective as of the date first written above and shall remain in full force and effect until the earliest to occur of the following: (i) Corporation and all of the Stockholders then holding Shares subject to this Agreement shall agree in writing to its termination; (ii) the offering by the Corporation of shares of the Common Stock of the Corporation pursuant to a registration statement that is effective under the Securities Act or the Corporation otherwise becoming a reporting company under Section 12 of the Exchange Act, PROVIDED, HOWEVER, that the provisions of Sections 5, 6 and 7 of this Agreement (and the defined terms and miscellaneous provisions of this Agreement pertaining thereto) shall remain in effect until satisfied; (iii) the purchase by one Stockholder of all the issued and outstanding Shares of the Corporation; or (iv) the dissolution, bankruptcy or receivership of the Corporation. Upon termination of this Agreement, the Secretary of the Corporation shall, as appropriate, upon tender of the certificates for Shares, delete the legends endorsed thereon pursuant to Section 8 of this Agreement.  14. REMEDIES FOR VIOLATIONS. Without limiting other remedies that may be available on account of a breach of this Agreement, in the event of any controversy concerning the rights or obligations under this Agreement, such right or obligation shall be enforceable in a court of equity by a decree of specific performance. 15. ENTIRE AGREEMENT. This Agreement contains the entire understanding and agreement between the parties with respect to the subject matter hereof, and supersedes any prior agreements among the parties concerning the subject matter hereof. 16. AMENDMENT. No change, modification or amendment of this Agreement shall be valid unless the same shall be in writing and signed by all of the parties to this Agreement; PROVIDED, HOWEVER, that the holders of at least ninety percent (90%) of the then outstanding Registrable Shares may effect any such change, modification or amendment, or may waive any term or provision, of Sections 5, 6 or 7 of this Agreement (and the defined terms and miscellaneous provisions of this Agreement pertaining thereto), which change, modification, amendment or waiver shall then be binding on all holders of Registrable Shares; PROVIDED FURTHER, HOWEVER, that if any such change, modification, amendment or wavier shall directly affect any holder of Registrable Shares in a manner that is materially and adversely different than its affect on any other holder of Registrable Shares, then such change, modification, amendment or wavier shall require the written agreement of the holder or holders of Registrable Shares so materially and adversely affected. 17. SEVERABILITY. The invalidity or unenforceability of any particular provision of this Agreement shall not affect the other provisions of this Agreement, and this Agreement shall be construed in all respects as if such invalid or unenforceable provision were omitted. 18. SECTION AND OTHER HEADINGS. The section and other headings contained in this Agreement are for reference purposes only and shall not affect the interpretation of this Agreement. The parties hereto agree that any rule of construction to the effect that ambiguities are to be resolved against the drafting party shall not be applied in the construction or interpretation of this Agreement. 19. COUNTERPARTS. This Agreement may be executed in one or more counterparts, each of which shall be deemed an original and all of which together shall constitute one and the same instrument. 20. CONSTRUCTION. Whenever required by the context, references herein to the singular shall include the plural and the masculine gender shall include the feminine and neuter genders. [Signature page follows]  IN WITNESS WHEREOF, the parties have executed this Agreement as of the day and year first above written. SOFT WAVE MEDIA, INC. By: /s/ Josh Wexler ------------------------------- Name: Josh Wexler Title:CEO SOFT WAVE MEDIA, LLC By: /s/ Charles Omphalius ------------------------------- Name: Charles Omphalius Title: Manager /s/ Robert A. Berman ------------------------------------ Robert A. Berman /s/ Debbie Berman ------------------------------------ Debbie Berman VISTA DEVELOPMENT, LLC By: /s/ Robert A. Berman ------------------------------- Name: Robert A. Berman Title: Manager SOFTWAVE HOLDINGS TRUST By: /s/ Scott Kaniewski ------------------------------- Name: Scott Kaniewski Title: Trustee /s/ Stacey Kaniewski ------------------------------------ Stacey Kaniewski KANIEWSKI FAMILY LIMITED PARTNERSHIP By: /s/ Scott Kaniewski ------------------------------- Name: Scott Kaniewski Title: General Partner  KFP TRUST By: /s/ Stacey Kaniewski ------------------------------- Name: Stacey Kaniewski Title: Trustee /s/ Paul deBary ------------------------------------ Paul deBary /s/ Robert H. Friedman ------------------------------------ Robert H. Friedman FOX HOLLOW LANE, LLC By: /s/ Charles A. Degliomini ------------------------------- Name: Charles A. Degliomini Title: Manager THE ZITTLOSEN VOLLBRACHT FAMILLY, LLC By: /s/ Maria Elizabeth Montero ------------------------------- Name: Maria Elizabeth Montero Title: Director /s/ Jonathan Farrow ------------------------------------ Jonathan Farrow BERMAN LIVING TRUST DATED 2/17/00 By: /s/ Pamela J. Bergman ------------------------------- Name: Pamela J. Bergman Title: Trustee /s/ Robert Wong ------------------------------------ Robert Wong