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SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, DC 20549
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SCHEDULE 13D
INFORMATION TO BE INCLUDED IN STATEMENTS FILED PURSUANT
TO RULE 13d-1 (a) AND AMENDMENTS THERETO FILED PURSUANT TO
RULE 13d-2(a)
(Amendment No. ____________)*
STYLECLICK.COM INC.
(Name of Issuer)
COMMON STOCK
(Title of Class of Securities)
864221 10 6
(CUSIP Number)
Maurizio Vecchione
Styleclick.com Inc.
3861 Sepulveda Boulevard
Culver City, California 90230
(310) 751-2100
(Name, Address and Telephone Number of Person
Authorized to Receive Notices and Communications)
January 24, 2000
(Date of Event which Requires Filing of this Statement)
If the filing person has previously filed a statement on Schedule 13G to report
the acquisition that is the subject of this Schedule 13D, and is filing this
schedule because of Rule 13d-1(e), 13d-1(f) or 13d-1(g), check the following box
[ ].
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* The remainder of this cover page shall be filled out for a reporting person's
initial filing on this form with respect to the subject class of securities, and
for any subsequent amendment containing information which would alter
disclosures provided in a prior cover page.
The information required on the remainder of this cover page shall
not be deemed to be "filed" for the purpose of Section 18 of the Securities
Exchange Act of 1934, as amended (the "Exchange Act"), or otherwise subject
to the liabilities of that section of the Exchange Act but shall be subject
to all other provisions of the Exchange Act (however, see the NOTES).
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CUSIP No. 864221 10 6 SCHEDULE 13D
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1 NAMES OF REPORTING PERSONS
I.R.S. IDENTIFICATION NOS. OF ABOVE PERSONS (ENTITIES ONLY)
Maurizio Vecchione
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2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP (a) / / (b) / /
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3 SEC USE ONLY
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4 SOURCE OF FUNDS
Not applicable
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5 CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT
TO ITEM 2(d) or 2(e) / /
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6 CITIZENSHIP OR PLACE OF ORGANIZATION
ITALY
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NUMBER OF 7 SOLE VOTING POWER
SHARE 0
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BENEFICIALLY 8 SHARED VOTING POWER*
OWNED BY 525,512
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EACH 9 SOLE DISPOSITIVE POWER
0
REPORTING ---------------------------------------------------------
PERSON WITH 10 SHARED DISPOSITIVE POWER*
525,512
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11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
525,512
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12 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES
CERTAIN SHARES / /
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13 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)**
6.7%
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14 TYPE OF REPORTING PERSON
IN
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* Consists of 417,619 shares held jointly by Maurizio Vecchione and
Andrea Vecchione, as to which shares they share voting and investment power,
103,893 shares which may be purchased by Maurizio Vecchione pursuant to
currently exercisable stock options, and 4,000 shares which may be purchased by
Andrea Vecchione upon the exercise of vested and currently exercisable warrants.
** Based on 7,716,930 shares of Common Stock outstanding on January
25, 2000 as reported by the Company.
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CUSIP No. 864221 10 6 SCHEDULE 13D
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1 NAMES OF REPORTING PERSONS
I.R.S. IDENTIFICATION NOS. OF ABOVE PERSONS (ENTITIES ONLY)
Andrea Vecchione
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2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP (a) / / (b) / /
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3 SEC USE ONLY
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4 SOURCE OF FUNDS
Not applicable
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5 CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT
TO ITEM 2(d) or 2(e) / /
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6 CITIZENSHIP OR PLACE OF ORGANIZATION
UNITED STATES
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NUMBER OF 7 SOLE VOTING POWER
SHARE 0
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BENEFICIALLY 8 SHARED VOTING POWER*
OWNED BY 525,512
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EACH 9 SOLE DISPOSITIVE POWER
0
REPORTING ---------------------------------------------------------
PERSON WITH 10 SHARED DISPOSITIVE POWER*
525,512
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11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
525,512
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12 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES
CERTAIN SHARES / /
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13 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)**
6.7%
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14 TYPE OF REPORTING PERSON
IN
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* Consists of 417,619 shares held jointly by Maurizio Vecchione and
Andrea Vecchione, as to which shares they share voting and investment power,
103,893 shares which may be purchased by Maurizio Vecchione pursuant to
currently exercisable stock options, and 4,000 shares which may be purchased by
Andrea Vecchione upon the exercise of vested and currently exercisable warrants.
** Based on 7,716,930 shares of Common Stock outstanding on January
25, 2000 as reported by the Company.
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ITEM 1 SECURITY AND ISSUER
This Statement relates to the common stock ("Common Stock") of
Styleclick.com Inc., a California corporation (the "Company"), and options to
purchase Common Stock. The Company's principal executive offices are located at
3861 Sepulveda Boulevard, Culver City, CA 90230.
ITEM 2 IDENTITY AND BACKGROUND
This statement is being filed jointly by Maurizio Vecchione and Andrea
Vecchione, as individuals (each referred to herein as a "Reporting Person"
and collectively as the "Reporting Persons") pursuant to the Joint Filing
Agreement dated February 2, 2000, a copy of which is attached hereto as
Exhibit 1.
<TABLE>
<CAPTION>
Name/Citizenship Present Business Address Present Principal Occupation
---------------- ------------------------ ----------------------------
<S> <C> <C>
Maurizio Vecchione/ Styleclick.com Inc. President and Director,
Italy 3861 Sepulveda Boulevard Co-Chief Executive Officer
Culver City, CA 90230
Andrea Vecchione/ 645 Ocampo Drive Herself
United States Pacific Palisades, CA 90272
</TABLE>
During the last five years none of the Reporting Persons has been (i)
convicted in any criminal proceeding (excluding traffic violations or similar
misdemeanors) or (ii) a party to a civil proceeding of a judicial or
administrative body of competent jurisdiction and as a result of such
proceeding was or is subject to a judgment, decree or final order enjoining
future violations of, or prohibiting of mandating activities subject to
federal or state securities laws or finding any violation with respect to
such laws.
ITEM 3 SOURCE AND AMOUNT OF CONSIDERATION
No funds or other consideration were used by the Reporting Persons to
purchase any securities of the Company within the last sixty days. This
Schedule 13D is being filed because Maurizio Vecchione has entered into the
Voting Agreement described in Item 4 below.
ITEM 4 PURPOSE OF TRANSACTION
On January 24, 2000, the Company and USA Networks, Inc. ("USA")
announced that they had entered into an Agreement and Plan of Merger (as
amended from time to time, the "Merger Agreement"), which sets forth the
terms and conditions of the proposed merger (the "Merger") of the Company and
USANi Sub LLC ("USANi"), a Delaware limited liability company and a
subsidiary of USA. Pursuant to the Merger Agreement, a wholly-owned
subsidiary of a newly organized Delaware corporation ("Newco") will merge
into the Company, with the Company surviving as a wholly owned subsidiary of
Newco. Prior to the Merger, the sole stockholder of Newco will be USANi.
Concurrently with the execution of the Merger Agreement, and as a condition
to the parties entering into the Merger Agreement, USANi entered into a Voting
Agreement
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with Maurizio Vecchione (the "Maurizio Vecchione Voting Agreement") with
respect to all of the shares of the Company's Common Stock now owned, whether
beneficially or of record, and which may hereafter be acquired by Maurizio
Vecchione and any shares of Company Common Stock (the "Shares") over which he
has investment power or voting power, each within the meaning of Rule
13d-3(a) of the Securities Exchange Act of 1934, as amended (the "Exchange
Act"), and all options to acquire Shares now owned and which may hereafter be
acquired (the "Options") by Maurizio Vecchione. Pursuant to the terms of the
Maurizio Vecchione Voting Agreement, Maurizio Vecchione, among other things,
agrees that at any meeting of the shareholders of the Company, however
called, and in any action by consent of the shareholders of the Company, he
shall vote his Shares or shall cause his Shares to be voted: (a) in favor of
the Merger, the Merger Agreement and the transactions contemplated by the
Merger Agreement (collectively, the "Proposed Transaction") and (b) against
any proposal (other than in respect of the Proposed Transaction) for any: (i)
merger, consolidation, share exchange, business combination,
recapitalization, liquidation, dissolution or similar transaction involving
the Company or any other material corporate transaction, the consummation of
which could reasonably be expected to impede, interfere with, prevent or
materially delay the Proposed Transaction; (ii) sale, lease, exchange,
transfer or other disposition of 20% or more of the assets of the Company in
a single transaction or series of transactions; or (iii) the acquisition by
any person or "group" (as defined in Section 13(d) of the Exchange Act) other
than USANi or its affiliates (herein, a "third party"), of "beneficial
ownership" of 15% or more of the Company's voting stock whether by tender
offer or exchange offer or otherwise and including a self tender offer,
merger, sale of assets or other business combination between the Company and
any person or entity or any other action or agreement that would result in a
breach of any covenant, representation or warranty or any other obligation or
agreement of the Company under the Merger Agreement or which could result in
any of the conditions to the Company's obligations under the Merger Agreement
not to be fulfilled. The Maurizio Vecchione Voting Agreement terminates upon
the earlier of (i) the consummation and the Merger, and (ii) twelve months
after termination of the Merger Agreement. A copy of the Maurizio Vecchione
Voting Agreement is attached hereto as Exhibit 2.
Except as set forth above, none of the Reporting Persons has any present
plans or proposals which relate to or would result in any actions described in
subparagraphs (a) through (j) of Item 4 of Schedule 13D.
ITEM 5 INTEREST IN SECURITIES OF THE ISSUER
(a) The responses of the Reporting Persons to Rows (7) through (13) of
cover pages 2 and 3 of this statement on Schedule 13D are incorporated herein
by reference. As of January 25, 2000, (i) Maurizio Vecchione beneficially
owned 417,619 shares of the Company's Common Stock and had the right to
acquire 103,893 shares of the Company's Common Stock pursuant to stock
options and (ii) Andrea Vecchione beneficially owned 417,619 shares of the
Company's Common Stock and had the right to acquire 4,000 shares of the
Company's Common Stock pursuant to warrants.
(b) The responses of the Reporting Persons to (i) Rows (7) through (13) of
the cover pages of this statement on Schedule 13D and (ii) Item 5(a) hereof are
incorporated
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herein by reference. The Reporting Persons disclaim the existence of a group
within the meaning of Section 13(d)(3) of the Exchange Act based upon the
Maurizio Vecchione Voting Agreement or any other agreements with respect to the
Common Stock of the Company.
(c) Except as disclosed in Item 4 hereof, none of the Reporting Persons
has effected any transaction in the Common Stock of the Company during the past
60 days.
(d) Not applicable.
(e) Upon consummation of the Merger referenced in Item 4, and subject to
certain conditions being met, the Reporting Persons will beneficially
own 131,378 shares of Newco, the surviving entity, at which point in
time neither Reporting Person would be a beneficial owner of more
than five percent of the class of securities of Newco.
ITEM 6 CONTRACTS, ARRANGEMENTS, UNDERSTANDINGS OR RELATIONSHIPS WITH RESPECT
TO SECURITIES OF THE ISSUER
The response to Item 4 hereof is incorporated herein by reference. Except
as set forth in this Schedule 13D, to the best knowledge of the Reporting
Persons, there are no other contracts, arrangements, understandings or
relationships (legal or otherwise) among the persons named in Item 2 and between
such persons and any person with respect to any securities or the Company,
including, but not limited to, transfer or voting of any of the securities of
the Company, joint ventures, loan or option arrangements, puts or calls,
guarantees of profits, division of profits or loss, or the giving or withholding
of proxies, or a pledge or contingency the occurrence of which would give
another person voting power or investment power over the securities of the
Company.
All statements made in the body of this statement concerning the terms
of the Maurizio Vecchione Voting Agreement are qualified in their entirety by
the actual text of such Agreement as filed herewith.
ITEM 7 MATERIAL TO BE FILED AS EXHIBITS
Exhibit 1 The Joint Filing Agreement dated February 2, 2000 among Maurizio
Vecchione and Andrea Vecchione.
Exhibit 2. Voting and First Offer Agreement, dated as of January 24, 2000,
among Maurizio Vecchione and USANi Sub LLC.
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SIGNATURE
After reasonable inquiry and to the best of my knowledge and belief, I
certify that the information set forth in this statement is true, complete and
correct.
Date: February 3, 2000
By: /s/ Maurizio Vecchione
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Maurizio Vecchione,
an individual
By: /s / Andrea Vecchione
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Andrea Vecchione,
an individual
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Exhibit 1
JOINT FILING AGREEMENT
Joint Filing Agreement, dated February 2, 2000, between Maurizio Vecchione
and Andrea Vecchione.
The undersigned hereby agree that this statement on Schedule 13-D with
respect to the beneficial ownership of shares of Common Stock of Styleclick.com
Inc. is filed jointly on behalf of each of them.
Date: February 2, 2000 By: /s/ Maurizio Vecchione
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Maurizio Vecchione, an individual
By: /s/ Andrea Vecchione
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Andrea Vecchione, an individual
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VOTING AND FIRST OFFER AGREEMENT
VOTING AND FIRST OFFER AGREEMENT, dated as of January 24, 2000 (this
"Agreement"), between Maurizio Vecchione (the "Principal Stockholder") and USANi
Sub LLC, a Delaware limited liability company ("Parent").
WHEREAS, Styleclick.com Inc., a California corporation (the "Company"),
and Parent propose to enter into an Agreement and Plan of Merger, dated as of
the date hereof (the "Merger Agreement"), which provides for, among other
things, the merger of the Company (the "Merger") with a wholly owned subsidiary
of a newly formed Delaware corporation ("Newco") and the concurrent contribution
by Parent to Newco of all of the outstanding limited liability interests of
Internet Shopping Network LLC, a Delaware limited liability company ("ISN");
WHEREAS, the Principal Stockholder is the owner of one or more of the
following securities: (a) shares of common stock of the Company, no par value
("Company Common Stock") and (b) options to acquire Company Common Stock; and
WHEREAS, in order to induce Parent to enter into the Merger Agreement,
the Principal Stockholder has agreed to enter into this Agreement with respect
to all the shares of Company Common Stock now owned, whether beneficially or of
record, and which may hereafter be acquired by the Principal Stockholder and any
shares of Company Common Stock over which the Principal Stockholder has
investment power or voting power, each within the meaning of Rule 13d-3(a) of
the Securities Exchange Act of 1934, as amended (the "Shares"), and all options
to acquire Shares now owned and which may hereafter be acquired (the "Options").
NOW, THEREFORE, in consideration of the foregoing and the mutual
covenants and agreements contained herein, and intending to be legally bound
hereby, the parties hereto hereby agree as follows:
ARTICLE 1
Section 1.1 Voting Agreement. The Principal Stockholder hereby agrees
that during the Restricted Period (as defined below) at any meeting of the
stockholders of the Company, however called, and in any action by consent of the
stockholders of the Company, the Principal Stockholder shall vote his Shares or
shall cause his Shares to be voted: (a) in favor of the Merger, the Merger
Agreement (as amended from time to time) and the transactions contemplated by
the Merger Agreement (the "Proposed Transactions") and (b) against any proposal
(other than in respect of the Proposed Transaction) for any: (i) merger,
consolidation, share exchange, business combination, recapitalization,
liquidation, dissolution or similar
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2
transaction involving the Company or any other material corporate transaction,
the consummation of which could reasonably be expected to impede, interfere
with, prevent or materially delay the Proposed Transactions; (ii) a sale, lease,
exchange, transfer or other disposition of 20% or more of the assets of the
Company in a single transaction or series of transactions; or (iii) the
acquisition by any person or "group" (as defined in Section 13(d) of the
Exchange Act) other than Parent or its affiliates (herein, a "third party"), of
"beneficial ownership" of 15% or more of the Company's voting stock whether by
tender offer or exchange offer or otherwise and including a self tender offer,
merger, sale of assets or other business combination between the Company and any
person or entity or any other action or agreement that would result in a breach
of any covenant, representation or warranty or any other obligation or agreement
of the Company under the Merger Agreement or which could result in any of the
conditions to the Company's obligations under the Merger Agreement not being
fulfilled. For purposes of this Agreement, the term "Restricted Period" shall
mean the time during which the Merger Agreement remains in effect and for 12
months thereafter.
Section 1.2 Acknowledgment. The Principal Stockholder acknowledges
receipt and review of a copy of the Merger Agreement.
Section 1.3 Waiver of Dissenters' Rights. The Principal Stockholder
hereby irrevocably and forever waives any rights the Principal Stockholder may
have, as a result of the Merger, to demand payment for any Shares beneficially
owned by the Principal Stockholder pursuant to Section 1300 et. seq. of
California Law or to otherwise qualify as a "dissenting shareholder" as such
term is used in such sections of California Law.
ARTICLE 2
REPRESENTATIONS AND WARRANTIES
OF THE PRINCIPAL STOCKHOLDER
The Principal Stockholder hereby represents and warrants to Parent as
follows:
Section 2.1 Authority Relative to This Agreement. The Principal
Stockholder has all necessary power and authority to execute and deliver this
Agreement, to perform his obligations hereunder and to consummate the
transactions contemplated hereby and no other proceedings on the part of the
Principal Stockholder are necessary to authorize this Agreement or to consummate
such transactions. This Agreement has been duly and validly executed and
delivered by the Principal Stockholder and, assuming the due authorization,
execution and delivery by Parent,
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3
constitutes a legal, valid and binding obligation of the Principal Stockholder,
enforceable against the Principal Stockholder in accordance with its terms.
Section 2.2 No Conflict. (a) The execution and delivery of this
Agreement by the Principal Stockholder do not, and the performance of this
Agreement by the Principal Stockholder will not, (i) conflict with or violate
any law, rule, regulation, order, judgment or decree applicable to the Principal
Stockholder or by which the Shares or the Options are bound or affected or (ii)
result in any breach of or constitute a default (or an event that with notice or
lapse of time or both would become a default) under, or give to others any
rights of termination, amendment, acceleration or cancellation of, or result in
the creation of a Lien (as defined below) on any of the Shares or the Options
pursuant to, any note, bond, mortgage, indenture, contract, agreement, lease,
license, permit, franchise or other instrument or obligation to which the
Principal Stockholder is a party or by which the Principal Stockholder or the
Shares or the Options are bound or affected, except for any such conflicts,
violations, breaches, defaults or other occurrences which would not prevent or
delay the performance by the Principal Stockholder of his obligations under this
Agreement.
(b) The execution and delivery of this Agreement by the
Principal Stockholder do not, and the performance of this Agreement by the
Principal Stockholder will not, require any consent, approval, authorization or
permit of, or filing with or notification to, any court or arbitrator or any
governmental body, agency or official except for applicable requirements, if
any, of the Securities Exchange Act of 1934, as amended, and except where the
failure to obtain such consents, approvals, authorizations or permits, or to
make such filings or notifications, would not prevent or delay the performance
by the Principal Stockholder of his obligations under this Agreement.
Section 2.3 Title to the Shares. As of the date hereof, the Principal
Stockholder is the record and beneficial owner of, or has voting power or
investment power over, the Shares, and is the record and beneficial owner of the
Options, listed on Schedule 1. Such Shares and Options are all the securities of
the Company owned, either of record or beneficially, by the Principal
Stockholder or in which the Principal Stockholder has voting or investment power
and the Principal Stockholder owns no other rights or interests exercisable for
or convertible into any securities of the Company. Except as identified on
Schedule 2, all of the Shares and Options referred to above are owned free and
clear of all security interests, liens, claims, pledges, options, rights of
first refusal, agreement, limitations on the Principal Stockholder's voting
rights, charges and other encumbrances of any nature whatsoever (collectively,
"Liens") except, with respect to the Options, the Company Option Plan and any
agreements executed pursuant thereto pursuant to which such Options were issued.
The Principal Stockholder has not appointed or granted any proxy, which
appointment or grant is still effective, with respect to the Shares.
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ARTICLE 3
COVENANTS OF THE PRINCIPAL STOCKHOLDER
Section 3.1 No Inconsistent Agreement. The Principal Stockholder hereby
covenants and agrees that he shall not enter into any agreement or grant a proxy
or power of attorney with respect to the Shares or Options which is inconsistent
with this Agreement.
Section 3.2 Transfer Restriction.
(a) The Principal Stockholder hereby covenants and agrees that
he shall not sell, give, assign, hypothecate, pledge, encumber, grant a security
interest in or otherwise dispose of, whether by operation of law or by agreement
or otherwise (each a "Transfer"), from the date hereof until the termination of
the Merger Agreement, any Shares or Options, or any right, title or interest
therein or thereto.
(b) Notwithstanding the foregoing, the Principal Stockholder
may Transfer any Shares or Options, or any right, title or interest therein or
thereto, to any trust which is established, and which remains, solely for the
benefit of the Principal Stockholder or his spouse, siblings, children or
grandchildren (a "Trust"), provided, that, prior to such Transfer, the Trust
shall execute and deliver an agreement by which it shall become a party to and
be bound by the applicable terms and provisions of this Agreement, in form and
substance reasonably satisfactory to Parent.
(c) Notwithstanding the foregoing, if Parent permits any
stockholder that is a party to an agreement containing restrictions on transfer
of the type contained herein (the "Transferring Stockholder") to Transfer any
Shares, Options or warrants to purchase Company Common Stock (the "Warrants")
after the date hereof and prior to the termination of the Merger Agreement,
which Transfer would otherwise be prohibited by such agreement, then Parent
shall permit the Principal Stockholder, upon his request, to Transfer a number
of Shares or Options equal to the product of (i) the number of Shares, Options
or Warrants Transferred by the Transferring Stockholder divided by the number of
Shares, Options or Warrants owned by the Transferring Stockholder as of the date
of such Transfer, and (ii) the number of Shares or Options owned by the
Principal Stockholder as of the date of such Transfer, in each case, treating
all Options and Warrants as Shares on an as- converted basis (without giving
effect to restrictions or limitations on the exercise of such Options or
Warrants).
Section 3.3 Right of First Offer. The Principal Stockholder hereby
covenants and agrees that, following the termination of the Merger Agreement and
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5
during the remainder of the Restricted Period, the Principal Stockholder shall
not Transfer any Shares or Options except pursuant to the following provisions:
(a) Offering Notice. If the Principal Stockholder wishes to
Transfer (other than pursuant to the Merger) all or any portion of his Shares or
Options to any person or entity (a "Third Party Purchaser"), the Principal
Stockholder shall first offer such Shares or Options to Parent, by sending
written notice (an "Offering Notice") to Parent, which shall state (i) the
number of Shares or Options proposed to be transferred (the "Offered
Securities"); (ii) whether such sale (with respect to Shares only) will be
effected in an open market transaction that complies with Rule 144(f) of the
Securities Act of 1933 (a "Public Sale") or otherwise (a "Private Sale"), (iii)
the proposed purchase price for the Offered Securities, which price must be in
cash and, with respect to a Public Sale, may not be at a per share price in
excess of the closing price of shares of Company Common Stock on the NASDAQ for
the trading day immediately prior to the date on which the Offering Notice is
given (the "Offer Price"); and (iv) with respect to a Private Sale, the terms
and conditions of such sale, which terms and conditions must be customary and
reasonable for a transaction of such type. Upon delivery of the Offering Notice,
such offer shall be irrevocable unless and until the rights of first offer
provided for herein shall have been waived or shall have expired;
(b) Parent Option. For a period of five days after the giving
of the Offering Notice pursuant to Section 3.3(a) (the "Option Period"), Parent
shall have the right (the "Option") but not the obligation to purchase all (but
not less than all) of the Offered Securities at a purchase price equal to the
Offer Price and, with respect to a Private Sale, upon the terms and conditions
set forth in the Offering Notice. The right of Parent to purchase any or all of
the Offered Securities under this Section 3.3(b) shall be exercisable by
delivering written notice of the exercise thereof (the "Acceptance"), prior to
the expiration of the Option Period, to the Principal Stockholder, which notice
shall state the number of Offered Securities proposed to be purchased by Parent.
The failure of Parent to respond within the Option Period shall be deemed to be
a waiver of the Option; provided that Parent may waive its rights under this
Section 3.3(b) prior to the expiration of the Option Period by giving written
notice to the Principal Stockholder (the date any such written waiver is
received by the Principal Stockholder or, if no notice is given, the last date
of the Option Period is referred to as the "Waiver Date");
(c) Closing. The closing of the purchase of Offered Securities
subscribed for by Parent under Section 3.3(b) shall be held at the executive
offices of Parent at 11:00 a.m., local time, on the later of (i) the 10th day
after the Acceptance pursuant to Section 3.3(b) and (ii) two days following the
date on which all governmental or regulatory approvals (including the expiration
of any waiting periods under the Hart-Scott-Rodino Antitrust Improvements Act)
with respect to such transaction, if any, have been obtained or at such other
time and place as the parties to
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6
the transaction may agree. At such closing, the Principal Stockholder shall
deliver certificates representing the Offered Securities, duly endorsed for
transfer and accompanied by all requisite transfer taxes, if any, and such
Offered Securities shall be free and clear of any Liens (other than those
arising hereunder) and the Principal Stockholder shall so represent and warrant,
and shall further represent and warrant that he is the sole beneficial and
record owner of such Offered Securities. Parent shall deliver at the closing
payment in full in immediately available funds for the Offered Securities
purchased. In connection with such sale the parties to the transaction shall
execute such additional documents and take all reasonable steps as are otherwise
necessary or appropriate to effectuate such transaction; and
(d) Sale to a Third Party Purchaser. If Parent does not elect
to purchase all of the Offered Securities under Section 3.3(b), the Principal
Stockholder may sell all, but not less than all, of the Offered Securities that
Parent elected not to purchase (i) with respect to a Private Sale to a Third
Party Purchaser on terms and conditions no less favorable to the Principal
Stockholder than those set forth in the Offering Notice; provided, however, that
such sale is bona fide and not undertaken for the purpose of avoiding the
Principal Stockholder's obligations hereunder and made pursuant to a contract
entered into within 10 days after the Waiver Date and (ii) with respect to a
Public Sale, such sale is effected within five days following the Waiver Date at
the market price in effect at the time of such sale. If such sale is not
consummated within five days after the Waiver Date with respect to a Public Sale
or 45 days after the Waiver Date with respect to a Private Sale, then the
restrictions provided for herein shall again become effective, and no transfer
of such Offered Securities may be made thereafter by the Principal Stockholder
without again offering the same to Parent in accordance with this Section 3.3.
Section 3.4 Stockholders Agreement. Prior to the Closing of the Merger,
the Principal Stockholder hereby agrees to execute the Stockholders Agreement,
substantially in the form attached as Exhibit A to the Merger Agreement.
Section 3.5 Employment Agreement. Prior to the Closing of the Merger,
the Principal Stockholder hereby agrees to execute an employment agreement,
between the Principal Stockholder and Newco, substantially in the form agreed to
by the Principal Stockholder and Parent prior to the execution hereof.
ARTICLE 4
REPRESENTATIONS AND WARRANTIES OF PARENT
Section 4.1 Authority Relative to this Agreement. Parent has full
right, power and authority to enter into and perform this Agreement and this
Agreement
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7
has been duly authorized, executed and delivered by Parent and is a valid and
binding agreement of Parent and enforceable against Parent in accordance with
its terms.
Section 4.2 No Conflict. (a) The execution and delivery of this
Agreement by Parent do not, and the performance of this Agreement by Parent will
not, conflict with or violate any law, rule, regulation, order, judgment or
decree applicable to Parent.
(b) The execution and delivery of this Agreement by Parent do
not, and the performance of this Agreement by Parent will not, require any
consent, approval, authorization or permit of, or filing with or notification
to, any court or arbitrator or any governmental body, agency or official except
for applicable requirements, if any, of the Securities Exchange Act of 1934, as
amended, and except where the failure to obtain such consents, approvals,
authorizations or permits, or to make such filings or notifications, would not
prevent or delay the performance by Parent of its obligations under this
Agreement.
ARTICLE 5
MISCELLANEOUS
Section 5.1 Termination. This Agreement shall terminate upon the
earliest to occur of (i) the Closing, (ii) the 12-month anniversary following
termination of the Merger Agreement and (iii) the termination of the Merger
Agreement by Parent pursuant to Section 7.1(c) of such Agreement; provided that
the representations and warranties contained herein shall survive the
termination hereof.
Section 5.2 Specific Performance. The parties hereto agree that
irreparable damage would occur in the event that any of the provisions of this
Agreement were not performed in accordance with the terms hereof and that the
parties shall be entitled to specific performance of the terms hereof, in
addition to any other remedy at law or in equity.
Section 5.3 Definitions. Unless otherwise defined herein, all
capitalized terms shall have the definitions assigned to such terms in the
Merger Agreement.
Section 5.4 Entire Agreement. This Agreement constitutes the entire
agreement among Parent and the Principal Stockholder with respect to the subject
matter hereof and supersedes all prior agreements and understandings, both
written and oral, between the parties with respect to the subject matter hereof.
<PAGE>
8
Section 5.5 Amendment. This Agreement may not be amended except by an
instrument in writing signed by the parties hereto.
Section 5.6 Severability. If any term or other provision of this
Agreement is invalid, illegal or incapable of being enforced by any rule or law,
or public policy, all other conditions and provisions of this Agreement shall
nevertheless remain in full force and effect so long as the economic or legal
substance of this Agreement is not affected in any manner materially adverse to
any party. Upon such determination that any term or other provision is invalid,
illegal or incapable of being enforced, the parties hereto shall negotiate in
good faith to modify this Agreement so as to effect the original intent of the
parties as closely as possible to the fullest extent permitted by applicable law
in a mutually acceptable manner in order that the terms of this Agreement remain
as originally contemplated.
Section 5.7 Governing Law. This Agreement shall be governed by, and
construed in accordance with, the laws of the State of New York regardless of
the laws that might otherwise govern under applicable principles of conflicts of
law.
Section 5.8 Jurisdiction. Each party to this Agreement hereby
irrevocably agrees that any legal action or proceeding arising out of or
relating to this Agreement or any agreements or transactions contemplated hereby
shall be brought in the courts of the State of New York and hereby expressly
submits to the personal jurisdiction and venue of such courts for the purposes
thereof and expressly waives any claim of improper venue and any claim that such
courts are an inconvenient forum.
<PAGE>
9
IN WITNESS WHEREOF, Parent and the Principal Stockholder have caused
this Agreement to be duly executed as of the date first above written.
USANi SUB LLC
By: /s/ Dara Khosrowshahi
----------------------------------
Name: Dara Khosrowshahi
Title: Vice President
/s/ Maurizio Vecchione
----------------------------------
Maurizio Vecchione
<PAGE>
Schedule 1
<TABLE>
<CAPTION>
Number of Shares
owned beneficially Number of
or of record (1) Options owned
------------- -------------
<S> <C>
417,619 237,227
</TABLE>
- -------------------------
1/ Other than Shares issuable upon exercise of Options, which are listed
- - in the next column.
<PAGE>
Schedule 2
Liens
-----
None.
