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SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
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SCHEDULE 13D
Under the Securities Exchange Act of 1934
GETTY IMAGES, INC.
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(Name of Issuer)
Shares of Common Stock, par value $0.01 per share
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(Title of Class of Securities)
374276 10 3
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(CUSIP Number)
Mark H. Getty
Getty Images, Inc.
101 Bayham Street
London NW1 0AG England
(01144171) 544-3456
(Name, Address and Telephone Number of
Person Authorized to Receive Notices and
Communications)
Copy to:
Christopher D. Dillon, Esq.
Shearman & Sterling
555 California Street, Suite 2000
San Francisco, CA 94104
Telephone: (415) 616-1100
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February 9, 1998
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(Date of Event which Requires Filing of this Statement)
If the filing person has previously filed a statement on Schedule 13G to report
the acquisition which is the subject of this Schedule 13D, and is filing this
schedule because of Rule 13d-1(b)(3) or (4), check the following box / /.
Exhibit Index is at Page 14
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CUSIP No. 374276 10 3
(1) Name of Reporting Person
S.S. or I.R.S. Identification No. of Above Person
Mark H. Getty
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(2) Check the Appropriate Box if a Member of a Group (See Instructions)
/ / (a)
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/X/ (b)
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(3) SEC Use Only
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(4) Source of Funds (See Instructions) OO
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(5) Check if Disclosure of Legal Proceedings is Required Pursuant to
Item 2(d) or 2(e). / /
(6) Citizenship or Place of Organization
Ireland
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Number of (7) Sole Voting Power 923,985
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Shares
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Beneficially (8) Shared Voting Power 622,602
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Owned by
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Each (9) Sole Dispositive Power 923,985
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Reporting
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Person (10) Shared Dispositive Power 622,602
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With
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(11) Aggregate Amount Beneficially Owned by Each Reporting Person 1,546,587
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(12) Check if the Aggregate Amount in Row (11) Excludes Certain Shares (See
Instructions)
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(13) Percent of Class Represented by Amount in Row (11) 5.2%
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(14) Type of Reporting Person (See Instructions) IN
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2
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CUSIP No. 374276 10 3
(1) Name of Reporting Person
S.S. or I.R.S. Identification No. of Above Person
The October 1993 Trust
---------------------------------------------------------------------------
---------------------------------------------------------------------------
(2) Check the Appropriate Box if a Member of a Group (See Instructions)
/ / (a)
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/X/ (b)
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(3) SEC Use Only
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(4) Source of Funds (See Instructions) OO
----------------------------------------
(5) Check if Disclosure of Legal Proceedings is Required Pursuant to
Item 2(d) or 2(e). / /
(6) Citizenship or Place of Organization
Jersey
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Number of (7) Sole Voting Power 0
--------------------------------
Shares
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Beneficially (8) Shared Voting Power 622,602
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Owned by
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Each (9) Sole Dispositive Power 0
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Reporting
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Person (10) Shared Dispositive Power 622,602
-------------------------
With
--------------------------------------------------
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(11) Aggregate Amount Beneficially Owned by Each Reporting Person 622,602
--------------
(12) Check if the Aggregate Amount in Row (11) Excludes Certain Shares (See
Instructions)
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(13) Percent of Class Represented by Amount in Row (11) 2.1%
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(14) Type of Reporting Person (See Instructions) OO
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Item 1. SECURITY AND ISSUER.
The class of equity securities to which this Statement on Schedule 13D
(this "Statement") relates is the shares of common stock, par value $0.01 per
share (the "Shares"), of Getty Images, Inc. ("Issuer"), a Delaware corporation.
The principal executive offices of the Issuer are located at 101 Bayham
Street, London NW1 0AG England.
Item 2. IDENTITY AND BACKGROUND.
This Statement is being filed by Mark H. Getty, an Irish citizen,
and the October 1993 Trust, a trust established by Mark H. Getty of which he
and his immediate family are the beneficiaries (each of Mark H. Getty and the
October 1993 Trust also referred to herein as a "Reporting Person", and
together, the "Reporting Persons"). Mark H. Getty's present principal
occupation is Co-Chairman of the Board of Directors of Issuer. His business
address is 101 Bayham Street, London NW1 0AG England. The principal business
address of the October 1993 Trust is La Motte Chambers, La Motte Street, St.
Helier, Jersey, JE1 1BJ England.
During the last five years, neither of the Reporting Persons has been
(a) convicted in a criminal proceeding (excluding traffic violations or similar
misdemeanors) or (b) 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 or mandating activities subject to, federal or
state securities laws or finding any violation with respect to such laws.
Item 3. SOURCE AND AMOUNT OF FUNDS OR OTHER CONSIDERATION.
Pursuant to the Merger Agreement, dated as of September 15, 1997 (the
"Merger Agreement"), by and among Issuer, Getty Communications plc, a public
limited company organized under the laws of England and Wales ("Getty
Communications"), PhotoDisc, Inc., a Washington corporation ("PhotoDisc"), and
Print Merger, Inc., a Washington corporation and wholly owned subsidiary of
Issuer ("Merger Sub"), the October 1993 Trust acquired 622,602 Shares on
February 9, 1998 in connection with the Transactions (as defined below).
The 622,602 Shares acquired by the October 1993 Trust were received in
exchange for its holdings of Class B ordinary shares, nominal value one pence
per share ("Getty Communications Class B Ordinary Shares"), of Getty
Communications. Pursuant to the Merger Agreement, upon the terms and subject to
the conditions thereof, (i) pursuant to a scheme of arrangement (the "Scheme of
Arrangement") in accordance with the Companies Act of 1985 of Great Britain (the
"Companies Act"), each issued Getty Communications Class B Ordinary Share was
converted into one Class A ordinary share, nominal value one pence per share
("Getty Communications Class A Ordinary Shares" and, together with Getty
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Communications Class A Ordinary Shares, "Getty Communications Ordinary Shares")
of Getty Communications, each Getty Communications Ordinary Share was
transferred to Issuer or its nominees and the holders of Getty Communications
Ordinary Shares were issued one Share for every two Getty Communications
Ordinary Shares held of record by such holders, and Getty Communications became
a wholly owned subsidiary of Issuer; and (ii) PhotoDisc was merged with and into
Merger Sub (the "Merger", and, together with the Scheme of Arrangement, the
"Transactions"), with Merger Sub as the surviving corporation in the Merger
becoming a wholly owned subsidiary of Issuer and the then outstanding shares of
common stock, par value $0.01 per share of PhotoDisc ("PhotoDisc Shares") were
converted into the right to receive the amount of cash and the number of Shares
specified in the Merger Agreement.
The Shares obtained by October 1993 Trust pursuant to the Merger and
the Transactions are subject to the Getty Parties Shareholders' Agreement
(defined and described in Item 6 below), whereby Getty Investments has the right
to vote the Shares held by October 1993 Trust.
Prior to completion of the Transactions, Mark H. Getty held options
to purchase up to an aggregate of 1,847,970 Getty Communications Class A
Ordinary Shares under the Getty Communications plc Executive Share Option
Plan. In connection with the Transactions, the vesting of such options was
accelerated. If all or a portion of such options are not exercised by May 9,
1998, the unexercised portion of the options will be converted into options
to purchase Shares for (up to an aggregate of 923,985 Shares) on a staged
vesting schedule.
Upon completion of the Transactions, Mark H. Getty was also granted
options under the Getty Images, Inc. 1998 Stock Incentive Plan to purchase up to
an aggregate of 575,000 Shares, none of which are exercisable within 60 days
after the date hereof.
Item 4. PURPOSE OF TRANSACTION.
Each of the Reporting Persons has acquired the Shares to which this
Schedule 13D relates for the purpose of making an investment in Issuer.
Each of the Reporting Persons from time to time intends to review his
or its investment in Issuer on the basis of various factors, including Issuer's
business, financial condition, results of operations and prospects, general
economic and industry conditions, the securities markets in general and those
for Issuer's securities in particular, as well as other developments and other
investment opportunities. Based upon such review, each of the Reporting Persons
will take such actions in the future as each of them may deem appropriate in
light of the circumstances existing from time to time. If either Reporting
Persons believes that further investment in Issuer is attractive, whether
because of the market price of Issuer's securities or otherwise, he or it may
acquire Issuer's Shares either in the open market or in privately negotiated
transactions. Similarly, depending on market and other factors, each of
5
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the Reporting Persons may determine to dispose of some or all of the Shares
currently owned by him or it or otherwise acquired by him or it either in the
open market or in privately negotiated transactions.
Except as set forth above, each of the Reporting Persons has not
formulated any plans or proposals which relate to or would result in: (i) the
acquisition by any person of additional securities of Issuer or the disposition
of securities of Issuer; (ii) an extraordinary corporate transaction involving
Issuer or any of its subsidiaries; (iii) a sale or transfer of a material amount
of the assets of Issuer or any of its subsidiaries; (iv) any change in the
present board of directors or management of Issuer; (v) any material change in
Issuer's capitalization or dividend policy; (vi) any other material change in
Issuer's business or corporate structure; (vii) any change in Issuer's charter
or bylaws or other instruments corresponding thereto or other action which
may impede the acquisition of control of Issuer by any person; (viii) causing a
class of Issuer's securities becoming deregistered or delisted; (ix) a class of
equity securities of Issuer becoming eligible for termination of registration or
(x) any action similar to any of those enumerated above.
Item 5. INTEREST IN SECURITIES OF ISSUER.
Based on the most recent information available, each of the Reporting
Persons is deemed to beneficially own the number of Shares and the percentage of
outstanding Shares listed in the responses to Items 11 and 13, respectively, on
his or its respective cover page filed herewith, and such responses are
incorporated by reference herein. In addition, the number of Shares with
respect to which each of the Reporting Persons (i) has sole voting power, (ii)
shares voting power, (iii) has sole dispositive power, and (iv) shares
dispositive power, are listed in the responses to Items 7, 8, 9, and 10,
respectively, on his or its respective cover page filed herewith, and such
responses are incorporated by reference herein.
Except as described herein, neither of the Reporting Persons nor any
of the parties referenced herein, has acquired or disposed of, or entered into
any other transaction with respect to, any Shares during the past 60 days.
Item 6. CONTRACTS, ARRANGEMENTS, UNDERSTANDINGS OR RELATIONSHIPS WITH RESPECT
TO SECURITIES OF ISSUER.
Each of the Reporting Persons is a party to the following agreements,
arrangements, understandings or relationships with respect to securities of
Issuer, which are summarized in the following sections. (The summaries below do
not purport to be complete and are subject, and qualified in their entirety by
reference, to all the terms and provisions contained within the actual
agreements.)
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A. STOCKHOLDERS' AGREEMENT
The Stockholders' Agreement dated as of February 9, 1998 (the
"Stockholders' Agreement") by and among (i) Issuer, (ii) Getty Investments,
Mark H. Getty, Jonathan D. Klein, Crediton Limited and the October 1993 Trust
(collectively, the "Getty Group"), and (iii) PDI, Mark Torrance and Wade
Torrance (collectively, the "Torrance Group"), and together with the Getty
Group, the "Significant Stockholders"), places certain restrictions on the
Significant Stockholders' abilities to transfer Shares. Pursuant to the
terms of the Stockholders' Agreement, no Significant Stockholder may sell,
encumber or otherwise transfer such Significant Stockholders' Shares except
(i) to Permitted Transferees (as defined below); (ii) pursuant to the terms
of the Stockholders' Agreement; (iii) pursuant to a registered public
offering of Shares in which no person or "Group" will purchase more than five
percent of the then outstanding Shares; or (iv) sales within the Rule 144
volume limitations (or within two times the Rule 144(e) volume limitations
for sellers entitled to rely upon Rule 144(k)), or in a cashless exercise of
options. A "Permitted Transferee" is defined as (i) Issuer or its
subsidiaries; (ii) in the case of any Significant Stockholder who is a
natural person, a person to whom Shares are transferred from such Significant
Stockholder by gift, will or the laws of descent and distribution; (iii) any
other member of the Getty Group or the Torrance Group, as the case may be
(and any Permitted Transferee of such Group); or (iv) any affiliate of any
Significant Stockholder; or (v) with respect only to the taking of an
encumbrance on Shares, any commercial bank or other financial institution
that lends funds to a Significant Stockholder on the condition of taking such
encumbrance in such Significant Stockholders' Shares.
If any Significant Stockholder (a "Prospective Seller") receives from
a person, other than a Permitted Transferee or another Significant Stockholder
(a "Stockholders' Agreement Third Party"), a bona fide offer to purchase any or
all of such Prospective Seller's Shares (the "Offered Stock") and such
Prospective Seller desires to sell the Offered Stock to such Stockholders'
Agreement Third Party, the Prospective Seller must provide written notice (the
"Offer Notice") of such offer to Issuer and the other Significant Stockholders
constituting the Significant Stockholders' "Group" in which the Prospective
Seller does not belong. The Offer Notice will constitute an offer by such
Prospective Seller to sell to the recipients of such Offer Notice all of the
Offered Stock at the price per share of Shares at which the sale to the
Stockholders' Agreement Third Party is proposed to be made in cash and will be
irrevocable for ten days after receipt of such Offer Notice. The Prospective
Seller has the right to reject any or all of the acceptances of the offer to
sell the Offered Stock and sell all, but not less than all, the Offered Stock to
the Stockholders' Agreement Third Party if (i) the Prospective Seller has not
received acceptances as to all the Offered Stock prior to the expiration of the
ten-day period following receipt of the Offer Notice or (ii) an accepting party
fails to consummate the purchase of the Offered Stock and neither Issuer nor the
other Significant Stockholders who received the Offer Notice are prepared to
purchase such Offered Stock within five business days of receiving notice of
such failed purchase. The obligations and rights of the Significant
Stockholders relating to the rights of first refusal will terminate when the
Getty Group or the Torrance Group, as the case may be, and any of such "Group's"
Permitted Transferees collectively beneficially own fewer than the greater of
3,000,000 Shares and such number of Shares as is equal to two percent or less of
the then outstanding Shares.
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Each of the Torrance Group and the Getty Group will have the right,
subject to termination conditions, to nominate one director. For so long as the
Getty Group has the right to nominate one director, it shall also have the right
to appoint from among the directors of Issuer, the Chairman of Issuer, provided,
however, that for so long as either Mark Torrance or Mark H. Getty are
Co-Chairmen of the Board of Directors of Issuer (the "Issuer Board"), such right
shall not be in effect.
Issuer shall include as a nominee for the Issuer Board the person
designated by each of the Getty Group and the Torrance Group and shall nominate
such person and use its reasonable best efforts to cause the election of such
person, unless the Issuer Board, in the exercise of its fiduciary duties,
reasonably shall determine that such person is not qualified to serve on the
Issuer Board. If the Issuer Board reasonably determines that such designee is
not so qualified, the Group designating such nominee shall have the opportunity
to specify one additional designee who shall be so included as a nominee subject
to the qualification set forth in the immediately preceding sentence.
The Significant Stockholders have agreed to take such actions within
their control as are necessary to implement each "Group's" right to appoint a
director, including the voting of their respective shares in favor of the
nominees designated by the Getty Group and the Torrance Group in accordance with
the Stockholders' Agreement.
The foregoing description of the Stockholders' Agreement is qualified
in its entirety by reference to such agreement, a copy of which is attached
hereto as Exhibit 1.
B. GETTY PARTIES SHAREHOLDERS' AGREEMENT
Prior to the completion of the Transactions, Getty Investments, the
October 1993 Trust and Crediton Limited, as the holders of the Getty
Communications Class B Ordinary Shares, were parties to a shareholders'
agreement with respect to their ownership of such shares. Upon consummation of
the Transactions, Getty Investments, Issuer, Crediton Limited, Abacus (C.I.)
Ltd. as the Trustee of the October 1993 Trust, Mark H. Getty and Jonathan D.
Klein entered into the Restated Shareholders' Agreement, dated February 9, 1998
(such agreement, as amended, being the "Getty Parties Shareholders' Agreement").
Certain provisions of the Getty Parties Shareholders' Agreement are described
below.
The Getty Parties Shareholders' Agreement provides that all Shares
held by the parties thereto (other than those held by Mark H. Getty and
Jonathan D. Klein) will be voted as directed by the board of directors of
Getty Investments. Before transferring such shares (other than certain
permitted transfers to affiliates or family members who, as a condition of
such permitted transfer, must agree to be bound by the terms of the Getty
Parties Shareholders' Agreement), the parties must first offer such shares to
the other parties. The price at which such shares must be offered is either
the price that another purchaser is willing to pay for such shares or, in the
event of a transfer pursuant to an exercise of registration rights, the
average closing market price of the Shares over the
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preceding ten business days. In the event that these rights of first refusal
are not exercised up, then the rights of first refusal in the Stockholders'
Agreement apply.
In the Getty Parties Shareholders' Agreement, the October 1993
Trust and Crediton Limited each agreed to retain at least 311,301 Shares
until July 8, 2001 and thereafter each agreed to retain at least 155,651
Shares for an additional two years; PROVIDED, HOWEVER, that the October 1993
Trust and Crediton Limited may sell shares in the event that (i) Mark H.
Getty (in the case of the October 1993 Trust) or Jonathan D. Klein (in the
case of Crediton Limited) ceases to be employed by Issuer or any of its
subsidiaries, or (ii) Getty Investments ceases at any time to hold seven
percent or more of the then outstanding Shares. In addition, if Getty
Investments or any of its members sells any Shares, the October 1993 Trust
and Crediton Limited will be permitted to sell the same proportion of their
Shares which are subject to this sale restriction as the number of Shares
sold by Getty Investment bears to its total number of Shares. The Getty
Parties Shareholders' Agreement provides that each of the October 1993 Trust
and Crediton Limited will, in consideration of its participation under such
agreement, receive an annual fee from Getty Investments in 1998 of L78,843
and L272,137, subject to certain inflation adjustments, respectively, and
thereafter an annual fee of L28,485 and L98,681, subject to certain inflation
adjustments, respectively, for each of the next four years.
In addition, each of Jonathan D. Klein, Crediton Limited, Mark H.
Getty and the October 1993 Trust (together the "Covenantees") agreed not to
transfer (other than to a permitted transferee in accordance with the Getty
Parties Shareholders' Agreement) any of their Shares until the later of the
announcement by the Issuer of its results for the second quarter of 1998 and
August 9, 1998, except for the transfer by Jonathan D. Klein or Crediton
Limited of up to 60,000 Shares in the aggregate or the transfer by Mark H.
Getty or the October 1993 Trust of up to 60,000 Shares in the aggregate.
Each of the Covenantees agreed with Getty Investments that in the event of
any proposed transfer (other than to a permitted transferee in accordance
with the Getty Parties Shareholders' Agreement) it shall give Getty
Investments at least ten days' notice of such proposed transfer and shall
consult with Getty Investments about the reasons for, manner of and timing of
such proposed transfer.
The Getty Parties Shareholders' Agreement also provides that each of
the October 1993 Trust and Crediton Limited have the right to nominate a
director to the board of directors of Getty Investments. Such parties have
nominated Mark H. Getty and Jonathan D. Klein. The October 1993 Trust also has
the right to nominate the chairman of Getty Investments. The October 1993 Trust
has nominated Mark H. Getty as Chairman of Getty Investments.
Getty Investments agreed in the Getty Parties Shareholders' Agreement
that, subject to certain exceptions, it will not operate or own or control any
other business in the visual content industry.
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The Getty Parties Shareholders' Agreement expires on July 8, 2003, but
may be terminated earlier with respect to a party (or its permitted transferees)
who ceases to be a shareholder of Issuer. The Getty Parties Shareholders'
Agreement terminates for all parties if the parties to the agreement cease to
own beneficially fewer than the greater of 3,000,000 Shares and such number of
shares as is equal to two percent or less of the then outstanding Shares.
The foregoing description of the Getty Parties Shareholders' Agreement
is qualified in its entirety by reference to such agreement, a copy of which is
attached hereto as Exhibit 2.
C. REGISTRATION RIGHTS AGREEMENT
Upon the consummation of the Transactions, Issuer assumed the
obligations of Getty Communications with respect to: (i) certain registration
rights that Getty Communications granted to Mark H. Getty, Jonathan D. Klein,
among others, pursuant to the Registration Rights Agreement, dated July 3, 1996
(the "Executive Registration Rights Agreement"), by and among Getty
Communications, Lawrence J. Gould, Mark H. Getty, Jonathan D. Klein, Simon
Thornley and Brian Wolske; and (ii) certain registration rights that Getty
Communications granted to October 1993 Trust and Crediton Limited pursuant to
the Registration Rights Agreement, dated July 3, 1996 (the "Getty Communications
Registration Rights Agreement"), by and among Getty Communications and each of
the trustees of the October 1993 Trust and Crediton Limited.
Copies of the Executive Registration Rights Agreement and the Getty
Communications Registration Rights Agreement and the related amendments thereto
are attached hereto as Exhibit 3 and 4, respectively.
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Item 7. MATERIAL TO BE FILED AS EXHIBITS.
<TABLE>
<CAPTION>
Description Exhibit Number
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<S> <C>
Stockholders' Agreement, dated as of 1
February 9, 1998, by and among (i)
Getty Images, Inc., (ii) Getty
Investments L.L.C., Mark Getty,
Jonathan Klein, Crediton Limited and
the October 1993 Trust and (iii) PDI,
L.L.C., Mark Torrance and Wade
Torrance
The Restated Getty Parties' 2
Shareholders Agreement, dated as of
February 9, 1998, among Getty
Investments L.L.C., Abacus (C.I.) Ltd.
as the Trustee of the October 1993
Trust, Crediton Limited, Mark H. Getty
and Jonathan D. Klein
Registration Rights Agreement, dated 3
July 3, 1996, by and among Getty
Communications plc, Lawrence J. Gould,
Mark H. Getty, Jonathan D. Klein,
Simon Thornley and Brian Wolske, and
amendment dated February 9, 1998
Registration Rights Agreement, dated 4
July 3, 1996, by and among Getty
Communications plc and each of the
trustees of the October 1993 Trust and
Crediton Limited, and amendment dated
February 9, 1998
Joint Filing Agreement, dated 5
February 19, 1998, between Mark H.
Getty and the October 1993 Trust
</TABLE>
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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.
February 19, 1998
/s/ Mark H. Getty
----------------------------------------
Mark H. Getty
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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.
February 19, 1998 THE OCTOBER 1993 TRUST
By: /s/ Authorized Signatory
------------------------------------
Name: Authorized Signatory
Title:
13
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EXHIBIT INDEX
Exhibit Number Description Page Number
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1 Stockholders' Agreement, dated as of
February 9, 1998, by and among (i)
Getty Images, Inc., (ii) Getty
Investments L.L.C., Mark Getty,
Jonathan Klein, Crediton Limited and
the October 1993 Trust and (iii)
PDI, L.L.C., Mark Torrance and Wade
Torrance
2 The Restated Getty Parties'
Shareholders Agreement, dated as of
February 9, 1998, among Getty
Investments L.L.C., Abacus (C.I.)
Ltd. as the Trustee of the October
1993 Trust, Crediton Limited, Mark H.
Getty and Jonathan D. Klein
3 Registration Rights Agreement, dated
July 3, 1996, by and among Getty
Communications plc, Lawrence J.
Gould, Mark H. Getty, Jonathan D.
Klein, Simon Thornley and Brian
Wolske, and amendment dated February
9, 1998
4 Registration Rights Agreement, dated
July 3, 1996, by and among Getty
Communications plc and each of the
trustees of the October 1993 Trust
and Crediton Limited, and amendment
dated February 9, 1998
5 Joint Filing Agreement, dated
February 19, 1998, between Mark H.
Getty and the October 1993 Trust
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---------------------------------
STOCKHOLDERS' AGREEMENT
---------------------------------
AMONG
GETTY IMAGES, INC.,
GETTY INVESTMENTS L.L.C.,
MARK GETTY,
JONATHAN KLEIN,
CREDITON LIMITED,
OCTOBER 1993 TRUST,
PDI, L.L.C.,
MARK TORRANCE,
AND
WADE TORRANCE
Dated as of February 9, 1998
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<PAGE>
TABLE OF CONTENTS
Page
----
ARTICLE I
DEFINITIONS
SECTION 1.01. Certain Defined Terms. . . . . . . . . . . . . . . . . 1
SECTION 1.02. Other Defined Terms. . . . . . . . . . . . . . . . . . 4
ARTICLE II
BOARD REPRESENTATION
SECTION 2.01. Board Representation . . . . . . . . . . . . . . . . . 4
ARTICLE III
TRANSFERS OF SHARES
SECTION 3.01. Agreement Not to Sell. . . . . . . . . . . . . . . . . 5
SECTION 3.02. Restrictions on Transfer . . . . . . . . . . . . . . . 6
SECTION 3.03. Rights of First Refusal. . . . . . . . . . . . . . . . 6
SECTION 3.04. Transferees to Execute Agreement . . . . . . . . . . . 11
SECTION 3.05. Improper Sale or Encumbrance . . . . . . . . . . . . . 12
SECTION 3.06. Legends . . . . . . . . . . . . . . . . . . . . . . . 12
ARTICLE IV
MISCELLANEOUS
SECTION 4.01. Expenses.. . . . . . . . . . . . . . . . . . . . . . . 12
SECTION 4.02. Notices. . . . . . . . . . . . . . . . . . . . . . . . 12
SECTION 4.03. Public Announcements.. . . . . . . . . . . . . . . . . 14
SECTION 4.04. Headings.. . . . . . . . . . . . . . . . . . . . . . . 14
SECTION 4.05. Severability.. . . . . . . . . . . . . . . . . . . . . 14
SECTION 4.06. Entire Agreement.. . . . . . . . . . . . . . . . . . . 15
SECTION 4.07. Assignment.. . . . . . . . . . . . . . . . . . . . . . 15
SECTION 4.08. No Third Party Beneficiaries.. . . . . . . . . . . . . 15
SECTION 4.09. Amendment; Waiver; Termination . . . . . . . . . . . . 15
(i)
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TABLE OF CONTENTS
(Continued)
Page
----
SECTION 4.10. Governing Law; Dispute Resolution. . . . . . . . . . . 15
SECTION 4.11. Counterparts.. . . . . . . . . . . . . . . . . . . . . 16
SECTION 4.12. Specific Performance.. . . . . . . . . . . . . . . . . 16
SECTION 4.13. All Shares Subject to this Agreement.. . . . . . . . . 16
(ii)
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STOCKHOLDERS' AGREEMENT (this "AGREEMENT") dated as of February 9,
1998 among Getty Images, Inc., a Delaware corporation ("GETTY IMAGES"), and
(a) Getty Investments L.L.C. ("GETTY INVESTMENTS"), Mark Getty, Jonathan Klein,
Crediton Limited and October 1993 Trust and (b) PDI, L.L.C. ("PDI"), Mark
Torrance and Wade Torrance (each of the foregoing (except Getty Images) being a
"STOCKHOLDER" and collectively, the "STOCKHOLDERS").
WHEREAS, Getty Images, Getty Communications plc, a public limited
company organized under the laws of England and Wales ("GETTY COMMUNICATIONS"),
Photodisc, Inc. a Washington corporation ("PHOTODISC"), and Print Merger, Inc.,
a Washington corporation and a wholly owned subsidiary of Getty Images ("MERGER
SUB") entered into the Merger Agreement dated as of September 15, 1997 (the
"MERGER AGREEMENT"), which provides, upon the terms and subject to the
conditions thereof, for the merger of Merger Sub and PhotoDisc; and
WHEREAS, it is a condition to the consummation of the transactions
contemplated under the Merger Agreement that the parties hereto enter into this
Agreement;
NOW, THEREFORE, in consideration of the forgoing and the mutual
agreements and covenants hereinafter set forth, the parties hereto hereby agree
as follows:
ARTICLE I
DEFINITIONS
SECTION 1.01. CERTAIN DEFINED TERMS. As used in this agreement, the
following terms have the following meanings:
"AFFILIATE" means, with respect to any specified Person, any other
Person that directly, or indirectly through one or more intermediaries,
controls, is controlled by, or is under common control with, such specified
Person.
"BENEFICIAL OWNER" or "BENEFICIALLY OWN" has the meaning given such
term in Rule 13d-3 under the Exchange Act, PROVIDED that beneficial ownership
under Rule 13d-3(d)(1)(i) shall be determined based on whether a Person has a
right to acquire beneficial ownership within 60 days or thereafter.
"CASH EQUIVALENTS" means (a) marketable direct obligations issued or
unconditionally guaranteed by the United States government or issued by any
agency thereof and backed by the full faith and credit of the United States, in
each case maturing within one year from the date of acquisition thereof, (b)
marketable direct obligations issued by any state of the United States or any
political subdivision of any such state or any public
<PAGE>
2
instrumentality thereof maturing within one year from the date of acquisition
thereof and, at the time of acquisition, having the highest rating obtainable
from any of Standard & Poor's Corporation, Moody's Investors Service, Inc. or
Duff & Phelps Credit Rating Co. or (c) commercial paper maturing not more than
one year from the date of issuance thereof and, at the time of acquisition,
having the highest rating obtainable from either Standard & Poor's Corporation
or Moody's Investors Service, Inc.
"CASHLESS EXERCISE OF OPTIONS" means sales of Shares of Common Stock
in connection with the simultaneous exercise of options to purchase Shares of
Common Stock to the extent required to pay the applicable exercise price.
"COMMON STOCK" means the common stock, par value $0.01 per share, of
Getty Images.
"CONTROL" (including the terms "CONTROLLED BY" and "UNDER COMMON
CONTROL WITH"), with respect to the relationship between or among two or more
Persons, means the possession, directly or indirectly or as trustee or executor,
of the power to direct or cause the direction of the affairs or management of a
Person, whether through the ownership of voting securities, as trustee or
executor, by contract or otherwise. Control shall be conclusively presumed when
any Person directly or indirectly owns 50% or more of the voting securities of
another Person.
"ENCUMBRANCE" means any security interest, pledge, mortgage, lien,
charge, adverse claim, preferential arrangement or restriction or other
encumbrance of any kind.
"EXCHANGE ACT" means the Securities Exchange Act of 1934, as amended,
and the rules and regulations promulgated thereunder.
"GETTY GROUP" means Getty Investments, Mark Getty, Jonathan Klein,
Crediton Limited and October 1993 Trust, and any other Person constituting a
Permitted Transferee of the foregoing Persons under clauses (ii), (iii) or (iv)
of the definition of Permitted Transferee.
"GROUP" means either the Getty Group or the Torrance Group.
"MARKETABLE SECURITIES" means securities that are (a) (i) securities
of or other interests in any Person that are traded on a national securities
exchange or reported on by the National Association of Securities Dealers
Automated Quotation System or (ii) debt securities on market terms of an issuer
that has debt or equity securities that are so traded or so reported on and in
which a nationally recognized securities firm has agreed to make a market, and
(b) not subject to restrictions on transfer as a result of any applicable
contractual provisions or the provisions of the Securities Act or, if subject to
such restrictions under the
<PAGE>
3
Securities Act, are also subject to registration rights reasonably acceptable to
the Person receiving such securities.
"PERMITTED TRANSFEREE" means (i) Getty Images or any Subsidiary, (ii)
in the case of any Stockholder who is a natural person, a Person to whom shares
of Common Stock are transferred from such Stockholder by gift, will or the laws
of descent and distribution, (iii) any other member of the Getty Group or the
Torrance Group, as the case may be (and any Permitted Transferee of such Group),
(iv) any "affiliate" of any Stockholder, including, without limitation, any
trust, partnership or limited liability company that a Stockholder controls or
is a beneficiary of, or any Person that is a member or a beneficiary of any
Stockholder or a beneficiary of any such trust, and any partnership or limited
liability company controlled by two or more of such trusts or beneficiaries of
such trust or trusts, or (v) with respect only to the taking of an Encumbrance
on Shares, any commercial bank or other financial institution that lends funds
to a Stockholder on condition of taking such Encumbrance in such Stockholder's
Shares.
"PERSON" means any individual, partnership, firm, corporation,
association, trust, unincorporated organization, joint venture or other entity,
as well as any syndicate or group that would be deemed to be a person under
Section 13(d)(3) of the Exchange Act.
"RULE 144 TRANSACTION" means any Sale of Shares within the volume
limitations of Rule 144(e) under the Securities Act (as in effect on the date
hereof) (or, if the seller is entitled to rely upon paragraph (k) of Rule 144,
within two times the volume limitations of Rule 144(e) that would have applied
if the seller was not entitled to rely upon paragraph (k) of Rule 144) to a
Person who, to the knowledge of the seller, does not beneficially own more than
5% of the then outstanding Common Stock.
"SALE" means any sale, assignment, transfer, distribution, gift or
other disposition of shares or of a participation therein, whether voluntarily
or by operation of law.
"SECURITIES ACT" means the Securities Act of 1933, as amended, and the
rules and regulations promulgated thereunder.
"SHARE" means any share of Common Stock and any securities issued in
respect thereof.
"SUBSIDIARY" means any and all corporations, partnerships, joint
ventures, associations and other entities controlled by Getty Images directly or
indirectly through one or more intermediaries.
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4
"TORRANCE GROUP" means PDI, Mark Torrance and Wade Torrance, and any
other Person constituting a Permitted Transferee of the foregoing Persons under
clauses (ii), (iii) or (iv) of the definition of Permitted Transferee.
"THIRD PARTY" means, with respect to any Stockholder, any other Person
(other than a Permitted Transferee of such Stockholder).
SECTION 1.02. OTHER DEFINED TERMS. The following terms shall have
the meanings defined for such terms in the Sections set forth below:
<TABLE>
<CAPTION>
Term Section
---- -------
<S> <C>
Accepting Party 3.03(b)
Board 2.01(a)
Notice of Acceptance 3.03(b)
Offer 3.03(a)
Offered Shares 3.03(a)
Offer Notice 3.03(a)
Offer Price 3.03(a)
Other Stockholders 3.03(a)
Prospective Seller 3.03(a)
Prospective Transferee 3.04(a)
Restricted Period 3.01(a)
</TABLE>
ARTICLE II
BOARD REPRESENTATION
SECTION 2.01. BOARD REPRESENTATION. (a) Each of the Getty Group and
the Torrance Group shall have the right to nominate one director to the Board of
Directors of Getty Images (the "BOARD") whenever such class of directors is
subject to an election; PROVIDED, HOWEVER, that the Torrance Group shall not
have such right for so long as Mark Torrance is an employee of Getty Images and
a member of the Board; and PROVIDED FURTHER, that such right shall terminate
with respect to either the Torrance Group or the Getty Group, as the case may
be, once such Group beneficially owns fewer than the greater of (i) 3,000,000
shares of Common Stock (subject to equitable adjustment in the event of stock
splits, stock dividends and similar events) and (ii) such number of shares of
Common Stock as is equal to 2% of the then outstanding shares of Common Stock.
Such right shall be in addition to any other voting rights that each Stockholder
may have with respect to its Shares.
<PAGE>
5
(b) For so long as the Getty Group has the right to nominate one
director to the Board pursuant to Section 2.01(a), the Getty Group shall also
have the right to appoint the Chairman of the Board from among the directors of
Getty Images; PROVIDED, HOWEVER, that the Getty Group shall not have such right
for so long as either Mark Torrance or Mark Getty is the Chairman or a
Co-Chairman of the Board.
(c) The Stockholders agree to take such actions within their control
as are necessary to implement the agreements set forth in Sections 2.01(a) and
2.01(b), including the voting of their respective Shares in favor of the Board
nominees designated by the Getty Group and the Torrance Group in accordance with
this Section 2.01.
(d) Getty Images shall include as a nominee for the Board recommended
by the Board the person designated by each of the Getty Group and the Torrance
Group in accordance with Section 2.01(a) and shall nominate such person and use
its reasonable best efforts to cause the election of such person, unless the
Board of Directors of Getty Images, in the exercise of its fiduciary duties,
reasonably shall determine that such person is not qualified to serve on the
Board. If the Board reasonably determines that such designee is not so
qualified, the Group designating such nominee shall have the opportunity to
specify one additional designee who shall be so included as a nominee subject to
the qualification set forth in the immediately preceding sentence.
(e) In the event that a vacancy is created at any time by the death,
disability, resignation or removal of any director nominated by the Getty Group
or the Torrance Group, the nominating Group shall have the right to designate a
replacement director to fill such vacancy (provided that such Group would be
entitled at that time to nominate a director pursuant to Section 2.01(a)) and
Getty Images and the Stockholders agree to take such actions within their
control as are necessary to implement the agreements set forth in this Section
2.01(e).
(f) To the extent not already proposed pursuant to Exhibit 7.11 of
the Merger Agreement, Mark Torrance may propose to the Board of Directors of
Getty Images non-employees with appropriate industry experience to fill two
vacancies on the Board of Directors of Getty Images as of the date hereof. The
Board of Directors of Getty Images shall consider any proposed appointee in good
faith.
ARTICLE III
TRANSFERS OF SHARES
SECTION 3.01. AGREEMENT NOT TO SELL. (a) Except with the prior
written consent of Getty Images, no Stockholder shall sell any Shares until the
earlier of (i) the date
<PAGE>
6
six months after the date of this Agreement and (ii) the time of the
effectiveness of a registration statement filed by Getty Images under the
Securities Act pursuant to which stockholders of Getty Images sell Shares (such
period being the "RESTRICTED PERIOD"); PROVIDED, HOWEVER, that during the
Restricted Period, the Getty Group or the Torrance Group, as the case may be,
may each sell up to 200,000 Shares in a Rule 144 Transaction or in a Cashless
Exercise of Options.
(b) After the expiration of the Restricted Period, no Stockholder
shall, directly or indirectly, make or solicit any Sale of, or create, incur,
solicit or assume any Encumbrance with respect to, any Share, except in
compliance with the Securities Act and this Agreement.
SECTION 3.02. RESTRICTIONS ON TRANSFER. Each Stockholder agrees that
it will not, directly or indirectly, make or solicit any Sale of, or create,
incur, solicit or assume any Encumbrance with respect to, any Share beneficially
owned by such Stockholder other than (i) any Sale to a Permitted Transferee or
the granting of any Encumbrance to a Permitted Transferee, (ii) any Sale that is
made in compliance with the procedures, and subject to the limitations, set
forth in Section 3.03 or any Sale made to any Third Party after the termination
of Section 3.03 pursuant to subparagraph (g) thereof, (iii) any Sale pursuant to
a public offering of shares of Common Stock pursuant to an effective
registration statement under the Securities Act in which, to the knowledge of
the selling Stockholder, no one Person shall purchase more than five percent of
the then outstanding shares of Common Stock, or (iv) any Sale pursuant to a Rule
144 Transaction or in a Cashless Exercise of Options. Notwithstanding the
foregoing, except as otherwise expressly provided in this Agreement, all Sales
permitted by the foregoing clauses (i) through (iv) shall be subject to, and
shall not be made other than in compliance with, the provisions of Sections
3.01, 3.04, 3.05 and 3.06.
SECTION 3.03. RIGHTS OF FIRST REFUSAL. (a) If at any time any
Stockholder receives from or otherwise negotiates with a Third Party a bona fide
offer to purchase for cash, Cash Equivalents or Marketable Securities or other
securities reasonably subject to valuation in the manner set forth in Section
3.03(b)(ii) below (for purposes of this Section 3.03, an "OFFER") any of the
Shares owned or held by such Stockholder, and such Stockholder intends to sell
such Shares to such Third Party, such Stockholder (for purposes of this Section
3.03, the "PROSPECTIVE SELLER") shall provide Getty Images and each of the other
Stockholders in the Group in which the Prospective Seller is not a member (for
purposes of this Section 3.03, the "OTHER STOCKHOLDERS") written notice of such
offer (for purposes of this Section 3.03, an "OFFER NOTICE"). The Offer Notice
shall identify the Third Party making the Offer, the number of Shares with
respect to which the Prospective Seller has such an Offer (for purposes of this
Section 3.03, the "OFFERED SHARES"), the consideration per Share at which a sale
is proposed to be made (for purposes of this Section 3.03, the "OFFER PRICE"),
and all other material terms and conditions of the Offer, including, without
<PAGE>
7
limitation, a description of any non-cash consideration sufficiently detailed to
permit valuation thereof, as well as a copy of the Offer, if available and
permitted pursuant the terms thereof. For avoidance of doubt, the Offer Price
may be expressed as an amount correlated to the price of the publicly traded
Common Stock determined as of a particular date or over a particular period.
(b) (i) The receipt of an Offer Notice by Getty Images and the
Other Stockholders from a Prospective Seller shall constitute an offer by such
Prospective Seller to sell to Getty Images and each Other Stockholder all (but
not less than all) of the Offered Shares at the Offer Price per Share in cash
(subject to the valuation procedures set forth in Section 3.03(b)(ii) below if
the Offer Price includes any non-cash consideration). Such offer shall be
irrevocable for 10 days after receipt of such Offer Notice by Getty Images and
each Other Stockholder. During such 10-day period, Getty Images and each Other
Stockholder shall, subject to the priorities set forth in Section 3.03(b)(iii),
have the right to accept such offer as to any or all of the Offered Shares by
giving a written notice of acceptance (for purposes of this Section 3.03, a
"NOTICE OF ACCEPTANCE") to the Prospective Seller prior to the expiration of
such 10-day period (for purposes of this Section 3.03, Getty Images or any Other
Stockholder so accepting such offer being an "ACCEPTING PARTY"). In the event
that within five days prior to the expiration of such 10-day period the
Prospective Seller shall not have received Notices of Acceptance for all of the
Offered Shares, the Prospective Seller shall notify each Accepting Party of such
fact and shall provide each Accepting Party an opportunity to submit an
additional Notice of Acceptance for any such remaining Offered Shares prior to
the expiration of such 10-day period. In the event that after the expiration of
such 10-day period (as may be extended pursuant to Section 3.03(b)(ii)(B)) the
Prospective Seller shall not have received Notices of Acceptance for all of the
Offered Shares, the Prospective Seller shall have the right to reject any or all
Notices of Acceptance theretofore received and to sell Shares in accordance with
Section 3.03(d).
(ii) If the Offer Price specified in the Offer Notice includes any
Cash Equivalents, Marketable Securities or other securities reasonably subject
to valuation in the manner set forth below, such Offer Price shall be deemed to
be the amount of any cash included in the Offer Price plus the value (as jointly
determined by two nationally recognized investment banking firms, one of whom
shall have been selected by Getty Images and other of whom shall have been
selected by the Prospective Seller) of such non-cash consideration included in
the Offer Price. For this purpose:
(A) the parties shall use their best efforts to cause any
determination of the value of any such non-cash consideration included in
the Offer Price to be made within three business days after the date of
receipt of the Offer Notice by Getty Images and the Other Stockholders. If
the firms selected by Getty Images and the Prospective Seller are unable to
agree upon the value of any such non-cash consideration within such
three-day period, the value of such non-cash consideration
<PAGE>
8
shall be deemed to be the average of the valuations determined by each
investment bank; and
(B) notwithstanding Section 3.03(b)(i), the date by which Getty
Images and the Other Stockholders must exercise their rights of first
refusal under this Section 3.03 shall be extended until three days after
the determination of the value of such non-cash consideration.
(iii) Getty Images and each Other Stockholder shall be entitled to
accept such offer from the Prospective Seller in the following order of
priority:
FIRST, Getty Images shall be entitled to accept such offer for any or
all of the Offered Shares;
SECOND, if Getty Images shall not have accepted such offer for all the
Offered Shares, each Other Stockholder shall be entitled to
accept such offer for any or all of the remaining Offered
Shares (PROVIDED, HOWEVER, that if Notices of Acceptance are
received from Other Stockholders in respect of more than the
number of remaining Offered Shares, each Other Stockholder
shall be entitled to accept such offer for not more than the
portion of the remaining Offered Shares determined on a pro
rata basis based on the ratio of the number of Shares then
owned by such Other Stockholder to the number of Shares then
owned by all Other Stockholders who have submitted Notices of
Acceptance); and
THIRD, if Getty Images and one or more of the Other Stockholders have
not accepted such offer for all the Offered Shares, each Other
Stockholder shall then be entitled to accept such offer for not
more than the portion of the remaining Offered Shares
determined on a pro rata basis based on the ratio of the number
of Offered Shares specified in such Other Stockholder's Notice
of Acceptance in respect of which such Other Stockholder shall
not be entitled to accept the Prospective Seller's offer as a
result of the application of the proviso contained in clause
SECOND above to the number of Offered Shares specified in all
such Other Stockholders' Notices of Acceptance in respect of
which such Other Stockholders shall not be entitled to accept
the Prospective Seller's offer as a result of the application
of the proviso contained in clause SECOND above (it being
understood that each such Other Stockholder shall be entitled
to indicate its interest in accepting more than its pro rata
share of the remaining Offered Shares and to accept the
Prospective Seller's offer with respect to (A) such additional
Offered Shares if all the Offered Shares are not otherwise
accepted pursuant to
<PAGE>
9
clauses FIRST, SECOND and THIRD or (B) such Offered Shares that
remain unsold as described in Section 3.03(d)(ii) below).
If Getty Images or any Other Stockholder so accepts the Prospective
Seller's offer, such Accepting Party will purchase for cash from the Prospective
Seller, and the Prospective Seller will sell to such Accepting Party, such
number of Offered Shares as to which such Accepting Party shall have accepted
the Prospective Seller's offer (which must total, as to all Accepting Parties,
all of the Offered Shares). The price per Share to be paid by such Accepting
Party shall be the Offer Price specified in the Offer Notice, payable in
accordance with the terms of the Offer by the Prospective Seller specified in
Section 3.03(b)(i) (or in cash if the Offer Price includes any non-cash
consideration, subject to the valuation procedures set forth in Section
3.03(b)(ii)). The Notice of Acceptance shall specify (i) such Accepting Party's
Acceptance of the Prospective Seller's offer and (ii) the number of Offered
Shares to be purchased by such Accepting Party. If, collectively, the Accepting
Parties shall not have accepted the Prospective Seller's offer as to all of the
Offered Shares, the Prospective Seller shall have the right to reject any or all
Notices of Acceptance theretofore received and to sell Shares in accordance with
Section 3.03(d).
(c) The consummation of any such purchase by and sale to any
Accepting Party shall take place on such date, not later than 20 days after
receipt of the latest Notice of Acceptance timely received by the Prospective
Seller, as such Accepting Party and the Prospective Seller shall select. Upon
the consummation of such purchase and sale, the Prospective Seller shall,
against delivery by the relevant Accepting Party of the Offer Price multiplied
by the number of Shares being purchased by such Accepting Party, (i) deliver to
the Accepting Party certificates evidencing the Offered Shares purchased and
sold, duly endorsed in blank or accompanied by written instruments of transfer
in form and substance satisfactory to such Accepting Party and duly executed by
the Prospective Seller, and (ii) shall assign all its rights under this
Agreement with respect to the Offered Shares purchased and sold pursuant to an
instrument of assignment reasonably satisfactory to such Accepting Party.
(d) In the event that:
(i) Getty Images and each Other Stockholder shall have received an Offer
Notice from a Prospective Seller but the Prospective Seller shall not
have received from Getty Images and one or more Other Stockholders
Notices of Acceptance as to all the Offered Shares prior to the
expiration of the 10-day period following receipt of such Offer Notice
(as may be extended pursuant to Section 3.03(b)(ii)(B)) or
(ii) (x) an Accepting Party shall have given a Notice of Acceptance
to the Prospective Seller but shall have failed to
consummate, other than as a
<PAGE>
10
result of the fault of the Prospective Seller, a purchase of
the Offered Shares with respect to which such Notice of
Acceptance was given within 20 days after receipt of the
Notice of Acceptance by the Prospective Seller and
(y) one or more Other Stockholders shall not have indicated an
interest upon any such failure to buy such Shares as
provided in clause (B) of the parenthetical phrase following
clause THIRD of Section 3.03(b)(iii) and shall not have
indicated that they are prepared to purchase such Shares
within five days of their receipt of a notice of such
failure from the Prospective Seller and
(z) Getty Images shall not have indicated an interest in
purchasing such Shares as have not been purchased pursuant
to the immediately preceding clause (y) and shall not have
been prepared to purchase such Shares at the offer price
originally specified in the Offer Notice relating to such
Shares within five days of its receipt of a notice from the
Prospective Seller that such Shares have not been purchased
pursuant to the immediately preceding clause (y),
such Prospective Seller shall have the right to reject any or all Notices of
Acceptance theretofore received, and nothing in this Section 3.03 shall limit
the right of the Prospective Seller to make thereafter a sale of the Offered
Shares so long as all the Offered Shares that are sold or otherwise disposed of
by the Prospective Seller (which number of Offered Shares shall be not less than
the number of Offered Shares specified in such Offer Notice) are sold for cash
or the Offer Consideration (A) within 90 days after the date of receipt of such
Offer Notice by Getty Images and the Other Stockholders, (B) at an amount not
less than the Offer Price included in such Offer Notice, (C) to the Third Party
making the Offer and (D) in compliance with applicable securities laws.
(e) In the event that Getty Images and the Other Stockholders
shall have received an Offer Notice from a Prospective Seller but the
Prospective Seller shall not have received Notices of Acceptance for all the
Offered Shares prior to the expiration of the 10-day period following receipt of
such Offer Notice by Getty Images and the Other Stockholders (as may be extended
pursuant to Section 3.03(b)(ii)(B)) and such Prospective Seller shall not have
sold the remaining Offered Shares before the expiration of the 90-day period in
accordance with paragraph (d) above, then such Prospective Seller shall not give
another Offer Notice for a period of 90 days from the last day of such 90-day
period.
(f) Anything in this Section 3.03 or in Section 3.02 to the
contrary notwithstanding, the provisions of this Section 3.03 will not be
applicable to any Sale or Encumbrance described in Sections 3.02(i), (iii) or
(iv).
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11
(g) The provisions of Sections 2.01(e) and 2.01(d) and Article
III shall terminate and be of no further force and effect with respect to either
the Getty Group or the Torrance Group, as the case may be, on and after the date
on which such Group collectively beneficially owns fewer than the greater of (i)
3,000,000 shares of Common Stock (subject to equitable adjustment in the event
of stock splits, stock dividends and similar events); and (ii) such number of
shares of Common Stock as is equal to 2% of the then outstanding shares of
Common Stock.
SECTION 3.04. TRANSFEREES TO EXECUTE AGREEMENT. (a) Each
Stockholder agrees that it will not, directly or indirectly, make any Sale of,
or create, incur or assume any Encumbrance with respect to, any Shares
beneficially owned by such Stockholder, unless prior to the consummation of any
such Sale or the creation, incurrence or assumption of any such Encumbrance, the
Person to whom such Sale is proposed to be made or the Person in whose favor
such Encumbrance is proposed to be created, incurred or assumed (a "PROSPECTIVE
TRANSFEREE") (i) executes and delivers to Getty Images and each Stockholder an
agreement, in form and substance reasonably satisfactory to Getty Images,
whereby such Prospective Transferee confirms that, with respect to the Shares
that are the subject of such Sale or Encumbrance, it shall be deemed to be a
"Stockholder" for purposes of this Agreement and agrees to be bound by all the
terms of this Agreement, and (ii) unless such Prospective Transferee is an
institutional investor, delivers to Getty Images an opinion of counsel,
satisfactory in form and substance to Getty Images, to the effect that such Sale
or Encumbrance is being conducted in compliance with applicable securities laws
and that the agreement referred to above that is delivered by such Prospective
Transferee is a legal, valid and binding obligation of such Prospective
Transferee enforceable against such Prospective Transferee in accordance with
its terms, subject to the effect of any applicable bankruptcy, reorganization,
insolvency, moratorium or similar laws affecting creditor's rights generally and
subject, as to enforceability, to the effect of general principles of equity
(regardless of whether such enforceability is considered in a proceeding in
equity or at law). Upon the execution and delivery by such Prospective
Transferee of the agreement referred to in clause (i) of the preceding sentence
and, if required, the delivery of the opinion of counsel referred to in clause
(ii) of the preceding sentence, such Prospective Transferee shall be deemed a
"Stockholder" for purposes of this Agreement and shall have the rights and be
subject to the obligations of a Stockholder under this Agreement, in each case
with respect to the Shares that were transferred to it by a Stockholder
hereunder or in respect of which such Encumbrance shall have been created,
incurred or assumed.
(b) Anything in this Section 3.04 or in Section 3.02 to the
contrary notwithstanding, the provisions of this Section 3.04 will not be
applicable to (i) any Sale of Shares pursuant to a public offering of shares of
Common Stock pursuant to an effective registration statement under the
Securities Act, (ii) any Sale of Shares in a Rule 144 Transaction or in a
Cashless Exercise of Options or (iii) any Sale of Shares to a Third Party
<PAGE>
12
in accordance with Section 3.03(d) after complying with the right of first
refusal requirements of Section 3.03.
SECTION 3.05. IMPROPER SALE OR ENCUMBRANCE. Any attempt not in
compliance with this Agreement to make any Sale of, or create, incur or assume
any Encumbrance with respect to, any Shares shall be null and void and of no
force and effect, the purported transferee shall have no rights or privileges in
or with respect to Getty Images, and Getty Images shall not give any effect in
Getty Images's stock records to such attempted Sale or Encumbrance.
SECTION 3.06. LEGENDS. (a) For so long as Shares beneficially
owned by a Stockholder are subject to the voting obligations and restrictions on
transfer set forth in Article II and in this Article III, certificates
evidencing such Share shall bear a legend in substantially the following form:
"THE SECURITIES EVIDENCED BY THIS CERTIFICATE ARE SUBJECT TO CERTAIN VOTING
OBLIGATIONS AND RESTRICTIONS ON TRANSFER AS SET FORTH IN A STOCKHOLDERS'
AGREEMENT, DATED AS OF FEBRUARY 9, 1998, AS IT MAY BE AMENDED FROM TIME TO
TIME, A COPY OF WHICH IS ON FILE AT THE PRINCIPAL EXECUTIVE OFFICES OF
GETTY IMAGES. NO REGISTRATION OF TRANSFER OF SUCH SECURITIES WILL BE MADE
ON THE BOOKS OF GETTY IMAGES UNLESS AND UNTIL SUCH RESTRICTIONS SHALL HAVE
BEEN COMPLIED WITH."
(b) In the event that any Shares shall cease to be subject to
the voting obligations or restrictions on transfer set forth in Article II or in
this Article III, Getty Images shall, upon the written request of the holder
thereof, issue to such holder a new certificate evidencing such Shares without
the relevant legend.
ARTICLE IV
MISCELLANEOUS
SECTION 4.01. EXPENSES. Except as otherwise specified in this
Agreement, all costs and expenses, including, without limitation, fees and
disbursements of counsel, financial advisors and accountants, incurred in
connection with this Agreement and the transactions contemplated hereby shall be
paid by the party incurring such costs and expenses.
SECTION 4.02. NOTICES. All notices, requests, claims, demands
and other communications hereunder shall be in writing and shall be given or
made (and shall be
<PAGE>
13
deemed to have been duly given or made upon receipt) by delivery in person, by
courier service, by cable, by facsimile, by telegram, by telex or by registered
or certified mail (postage prepaid, return receipt requested) to the respective
parties at the following addresses (or at such other address for a party as
shall be specified in a notice given in accordance with this Section 4.02):
(a) if to Getty Images or members of the Getty Group other than Getty
Investments:
Getty Images, Inc.
500 North Michigan Avenue
Suite 1700
Chicago, Illinois 60611
Facsimile: (1312) 922-9075
Attention: Andrew Duncomb
with a copy to each of:
Getty Communications plc
101 Bayham Street
London NW1 0AG England
Facsimile: (44171) 267-6540
Attention: Nick Evans-Lombe
Clifford Chance
200 Aldersgate Street
London EC1A 4JJ England
Facsimile: (44171) 600-5555
Attention: Michael Francies
Shearman & Sterling
555 California Street
San Francisco, California 94104
Facsimile: (415) 616-1199
Attention: Christopher D. Dillon
(b) if to Getty Investments:
Getty Investments L.L.C.
1325 Airmotive Way, Suite 262
Reno, Nevada 89502
Facsimile: (702) 786-5414
<PAGE>
14
Attention: Jan D. Moehl
Mark J. Jenness
(c) if to members of the Torrance Group:
PhotoDisc, Inc.
2013 Fourth Avenue
4th Floor
Seattle, WA 98121
Facsimile: (206) 441-9379
Attention: Mark Torrance
with a copy to:
Graham & James LLP/Riddell Williams P.S.
1001 Fourth Avenue Plaza
Suite 4500
Seattle, Washington 98154-1085
Facsimile: (206) 389-1708
Attention: John Steel
SECTION 4.03. PUBLIC ANNOUNCEMENTS. No party to this Agreement
shall make, or cause to be made, any press release or public announcement in
respect of this Agreement or the transactions contemplated hereby or otherwise
communicate with any news media without the prior written consent of the other
party (except to the extent that such disclosure is required by law or the rules
of the Nasdaq National Market), and, to the extent practicable, the parties
shall cooperate as to the timing and contents of any such press release or
public announcement.
SECTION 4.04. HEADINGS. The descriptive headings contained in this
Agreement are for convenience of reference only and shall not affect in any way
the meaning or interpretation of this Agreement.
SECTION 4.05. SEVERABILITY. If any term or other provision of this
Agreement is invalid, illegal or incapable of being enforced by any law or
public policy, all other terms and provisions of this agreement shall
nevertheless remain in full force and effect so long as the economic or legal
substance of the transactions contemplated hereby 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 in an acceptable manner in
order that the transactions
<PAGE>
15
contemplated hereby are consummated as originally contemplated to the greatest
extent possible.
SECTION 4.06. ENTIRE AGREEMENT. This Agreement constitutes the
entire agreement of the parties hereto with respect to the subject matter
hereof and supersedes all prior agreements and undertakings, both written and
oral, among the parties hereto with respect to the subject matter hereof, except
as otherwise expressly provided herein.
SECTION 4.07. ASSIGNMENT. Except as otherwise expressly provided
herein, this Agreement shall be binding upon and shall inure solely to the
benefit of the parties hereto and their respective successors and permitted
assigns; PROVIDED, HOWEVER, that this Agreement shall not inure to the benefit
of any transferee unless such transferee shall have complied with the terms of
Section 3.04. No Stockholder may assign any of its rights hereunder to any
Person other than a transferee that has complied with the requirements of
Section 3.04 in all respects.
SECTION 4.08. NO THIRD PARTY BENEFICIARIES. Nothing herein, express
or implied, is intended to or shall confer upon any other Person any legal or
equitable right, benefit or remedy of any nature whatsoever under or by reason
of this Agreement.
SECTION 4.09. AMENDMENT; WAIVER; TERMINATION. Any term of this
Agreement may be amended or modified, and the observance of any term may be
waived, only by an instrument in writing signed by Getty Images and Stockholders
in each of the Getty Group and the Torrance Group holding Shares representing a
majority of the Shares then held by Stockholders in such Group; provided,
however, that no modification to Sections 2.01 or 4.09 may be made without the
consent of the party affected thereby. Waiver of any term or condition of this
Agreement shall only be effective if it is in writing and shall not be construed
as a waiver of any subsequent breach or waiver of the same term or condition, or
a waiver of any other term or condition of this Agreement. Each Stockholder
shall be bound by any amendment or waiver authorized by this Section 4.09,
whether or not such Stockholder shall have consented thereto. No failure or
delay by any party in exercising any right, power or privilege under this
Agreement shall operate as a waiver thereof nor shall any single or partial
exercise thereof preclude any other or further exercise thereof or the exercise
of any other right, power or privilege. The rights and remedies herein provided
shall be cumulative and not exclusive of any rights or remedies provided by law.
This Agreement may be terminated upon the unanimous written consent of the
Stockholders.
SECTION 4.10. GOVERNING LAW; DISPUTE RESOLUTION. This Agreement
shall be governed by, and construed in accordance with, the laws of the State of
Delaware applicable to contracts executed in and to be performed entirely within
that State. All actions and proceedings arising out of or relating to this
Agreement shall be heard and determined in
<PAGE>
16
any Delaware state or federal court sitting in the State of Delaware. In the
event of any dispute, claim or litigation with regard to this Agreement, the
prevailing party shall be entitled to receive from the non-prevailing party, and
the non-prevailing party shall promptly pay, all reasonable fees and expenses of
counsel for the prevailing party incurred in connection with such dispute, claim
or litigation.
SECTION 4.11. COUNTERPARTS. This Agreement may be executed in one or
more counterparts, and by the different parties hereto in separate counterparts,
each of which when executed shall be deemed to be an original but all of which
taken together shall constitute one and the same agreement.
SECTION 4.12. SPECIFIC PERFORMANCE. The parties hereto agree that
irreparable damage would occur in the event that any provision of this Agreement
was 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 4.13. ALL SHARES SUBJECT TO THIS AGREEMENT. All Shares shall
be held subject to the terms of this Agreement and the Stockholder thereof shall
be deemed a holder for purposes of this Agreement, as follows:
(i) Any Shares hereafter acquired by any Stockholder shall be held
by such Person subject to the provisions of this Agreement and such Person
shall be deemed to be a Stockholder for purposes of such additional Shares;
and
(ii) Any Stockholder who ceases to own any Shares as provided for in
this Agreement shall cease to be a Stockholder for purposes of such Shares
no longer so owned.
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to
be executed as of the date first written above by their respective officers
thereunto duly authorized or in their individual capacities, as applicable.
GETTY IMAGES, INC.
By: /s/ Lawrence Gould
---------------------------
Title: Treasurer
<PAGE>
17
GETTY INVESTMENTS L.L.C.
By: /s/ Jan D. Moehl
---------------------------
Title: Officer
/s/ Mark Getty
------------------------------
Mark Getty
/s/ Jonathan Klein
------------------------------
Jonathan Klein
CREDITON LIMITED
By: /s/ R.L. Breadner
---------------------------
Title: Director
OCTOBER 1993 TRUST
By: /s/ Authorised Signatory
---------------------------
Title: Authorised Signatory
PDI, L.L.C.
By: /s/ Mark Torrance
---------------------------
Title:
/s/ Mark Torrance
------------------------------
Mark Torrance
/s/ Wade Torrance
------------------------------
Wade Torrance
<PAGE>
(1) GETTY INVESTMENTS L.L.C.
(2) THE INVESTORS NAMED HEREIN
(3) GETTY IMAGES, INC.
(4) MARK GETTY AND JONATHAN KLEIN
- --------------------------------------------------------------------------------
RESTATED SHAREHOLDERS AGREEMENT
- --------------------------------------------------------------------------------
<PAGE>
CONTENTS
<TABLE>
<CAPTION>
CLAUSE PAGE
<S> <C>
1. INTERPRETATION. . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2
2. VOTING ARRANGEMENTS . . . . . . . . . . . . . . . . . . . . . . . . . . 4
3. PLEDGE OF COMMON STOCK. . . . . . . . . . . . . . . . . . . . . . . . . 4
4. PERMITTED TRANSFERS . . . . . . . . . . . . . . . . . . . . . . . . . . 4
5. TRANSFERS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5
6. TRANSFERS - GENERAL . . . . . . . . . . . . . . . . . . . . . . . . . . 6
7. LOCK-UP - CREDITON. . . . . . . . . . . . . . . . . . . . . . . . . . . 7
8. LOCK-UP - OCTOBER TRUST . . . . . . . . . . . . . . . . . . . . . . . . 8
9. SPECIAL LOCK-UP . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10
10. STOCK CERTIFICATE LEGEND. . . . . . . . . . . . . . . . . . . . . . . . 10
11. NON-COMPETITION . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10
12. APPOINTMENT OF CHAIRMAN OF GETTY IMAGES . . . . . . . . . . . . . . . . 11
13. TERM. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11
14. TERMINATION . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11
15. CONSEQUENCES OF TERMINATION . . . . . . . . . . . . . . . . . . . . . . 11
16. FURTHER ASSURANCE . . . . . . . . . . . . . . . . . . . . . . . . . . . 11
17. GENERAL . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 12
18. RESTRICTIVE TRADE PRACTICES ACT . . . . . . . . . . . . . . . . . . . . 12
19. SATISFACTION OF LEGAL REQUIREMENTS. . . . . . . . . . . . . . . . . . . 12
20. ASSIGNMENT. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 12
21. NOTICES . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 12
22. GOVERNING LAW . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 13
<PAGE>
23. COUNTERPARTS. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 14
24. POWER TO APPOINT, REMOVE AND REPLACE A DIRECTOR OF GETTY INVESTMENTS. . 14
25. CHAIRMAN OF BOARD OF GETTY INVESTMENTS. . . . . . . . . . . . . . . . . 14
</TABLE>
<PAGE>
THIS AGREEMENT is made on 9 February 1998
BETWEEN:
(1) GETTY INVESTMENTS L.L.C. a limited liability company organised
pursuant to the Delaware Limited Liability Company Act whose principal
office is at 1325 Airmotive Way, Suite 262, Reno, Nevada 89502-3240
("GETTY INVESTMENTS");
(2) THOSE PERSONS whose names and addresses are set out in Exhibit A
hereto (the "INVESTORS");
(3) GETTY IMAGES, INC, a company incorporated and existing under the laws
of Delaware, with its principal office at 500 North Michigan Avenue,
Suite 1700, Chicago, Illinois, 60611 U.S.A. ("GETTY IMAGES"); and
(4) MARK GETTY and JONATHAN KLEIN, shareholders of Common Stock ("GETTY
AND KLEIN")
WHEREAS
(A) On 8 July 1996 Getty Investments and the Investors entered into a
Shareholders Agreement as amended by a Supplemental Agreement dated 1
November 1996 (collectively the "ORIGINAL SHAREHOLDERS AGREEMENT") to
regulate the conduct of Getty Investments and the Investors in
relation to their direct and indirect investments in Getty
Communications plc ("GETTY COMMUNICATIONS").
(B) The share capital of Getty Communications was divided into A Shares
and B Shares. The A Shares and the B Shares had identical rights
attached to them apart from the voting rights where the B Shares had
ten votes per share and the A Shares had one vote per share.
(C) Getty Investments and the Investors owned 100% of the issued and
allotted B Shares in Getty Communications.
(D) On 15 September 1997 Getty Communications entered into a merger
agreement (the "MERGER AGREEMENT") with PhotoDisc, Inc ("PHOTODISC").
Pursuant to the terms of the Merger Agreement Getty Images was formed
and (i) pursuant to a scheme of arrangement (the "SCHEME OF
ARRANGEMENT") each issued B Share of Getty Communications was
converted into one A Share of Getty Communications, each A Share of
Getty Communications was then transferred to Getty Images and the
holders of Getty Communications A Shares were issued one share of
Common Stock for every two Getty Communications A Shares held and
Getty Communications became a wholly owned subsidiary of Getty Images;
and (ii) PhotoDisc was merged with and into a wholly owned subsidiary
of Getty Images ("MERGERSUB") with MergerSub as the surviving
corporation.
<PAGE>
(E) Following completion of the Merger Agreement Getty Investments has,
through its ownership of Common Stock, a significant interest in Getty
Images.
(F) THIS AGREEMENT is intended to regulate the conduct of Getty
Investments and the Investors in relation to their direct and indirect
investments in Getty Images. By this Agreement the parties wish to
restate the Original Shareholders Agreement in full.
THE PARTIES AGREE in consideration of the mutual terms, covenants and
conditions herein contained, and for other good and valuable consideration,
the receipt and sufficiency of which is hereby acknowledged, as follows:
1. INTERPRETATION
1.1 In this Agreement:
"AFFILIATE" means, with respect to any Person, any other Person
directly or indirectly Controlling, directly or indirectly Controlled
by or under direct or indirect common Control with such Person;
"CLOSING PRICE" means with respect to Common Stock, the last reported
sale price on a Trading Day or, in case no such sale takes place on
such day, the average of the reported closing bid and asked prices as
reported on the New York Stock Exchange Composite Tape, or, if such
sales are not so reported, the reported last sale price or, if no such
sale takes place on such day, the average of the reported closing bid
and asked prices on the principal national securities exchange on
which the Common Stock is listed or admitted to trading, or if not
listed or admitted to trading on any national securities exchange, on
the National Association of Securities Dealer Automated Quotations
("NASDAQ") National Market System, or if the Common Stock is not
quoted on such National Market System, the average of the closing bid
and asked prices in the over-the-counter market as furnished by any
New York Stock Exchange member firm selected by Getty Images for that
purpose;
"COMMON STOCK" means the shares of Common Stock, par value $0.01 per
share of Getty Images;
"CONTROL" means, with respect to any Person, the possession, directly
or indirectly, of the power to direct or cause the direction of the
management or policies of the controlled Person, whether through
equity ownership, by contract or otherwise;
"CONTROLLING PERSON" means, as to any Person, any one or more Persons
who Control such Person;
"CREDITON" means Crediton Limited and the "Permitted Transferees" of
the Common Stock held by Crediton (if any) pursuant to this Agreement;
"GETTY INVESTMENTS" means Getty Investments and the "Permitted
Transferees" of the Common Stock held by Getty Investments (if any)
pursuant to this Agreement;
<PAGE>
"GROUP" means Getty Images and each Subsidiary thereof;
"INVESTORS" means the Investors listed in Exhibit A hereto, together
with the respective Permitted Transferees of the Common Stock held by
such Persons (if any) pursuant to this Agreement;
"OCTOBER TRUST" means the Trustees of the October 1993 Trust and the
"Permitted Transferees" of the Common Stock held by the October Trust
(if any) pursuant to this Agreement; October Trust is the beneficial
owner of the Common Stock which is registered in the name of Abacus
(C.I.) Limited as trustee of the October 1993 Trust ("ABACUS");
"PARTY" means any party to this Agreement or a Person who becomes a
Party pursuant to the provisions of this Agreement;
"PERMITTED TRANSFEREE" means a Person who is a "permitted transferee"
of Common Stock as set forth in clauses (iii) (with reference to
members of the Getty Group only) and (iv) of the definition of
Permitted Transferee under the Stockholders' Agreement;
"PERSON" means an individual, corporation, general or limited
partnership, limited or unlimited liability company, trust,
association, unincorporated organisation, government or any authority,
agency or body thereof, or other entity and any legal personnel
representative successors and lawful assigns of any of them;
"REGISTRATION RIGHTS AGREEMENTS" means (i) the Registration Rights
Agreement dated 9 February between Getty Images, and Getty Investments
and (ii) the Registration Rights Agreement dated 3 July 1996 and
amended by the Registration Rights Agreement Amendment dated 9
February, among Getty Images, October Trust and Crediton;
"STOCKHOLDERS' AGREEMENT" means the Stockholders' Agreement dated 9
February between Getty Images and (a) Getty Investments, Mark Getty,
Jonathan Klein, Crediton Limited and October 1993 Trust and (b) PDI,
L.L.C., Mark Torrance and Wade Torrance;
"TRADING DAY" means a weekday (except for public holidays and Sundays)
on which the New York Stock Exchange is open for business; and
"TRANSFER" means to sell, assign, pledge, grant a security interest
in, otherwise dispose of, of agree to do any of the foregoing with
respect to the Common Stock.
1.2 In this Agreement, a reference to:
1.2.1 a "SUBSIDIARY" or "HOLDING COMPANY" is to be construed in accordance
with section 736 of the Companies Act 1985;
1.2.2 a statutory provision includes a reference to the statutory provision
as modified or re-enacted or both from time to time whether before or
after the date of this Agreement
<PAGE>
and any subordinate legislation made under the statutory provision
whether before or after the date of this Agreement;
1.2.3 a clause or schedule, unless the context otherwise requires, is a
reference to a clause of or schedule to this Agreement; and
1.2.4 a document is a reference to that document as from time to time
supplemented or varied.
1.3 The headings in this Agreement do not affect its interpretation.
1.4 Getty and Klein are parties to this Agreement solely for the purposes
of clauses 4, 5, 6 and 9 and any other clauses necessary for the
interpretation of clauses 4, 5, 6 and 9.
2. VOTING ARRANGEMENTS
The Parties hereto hereby agree that they shall exercise the voting
rights associated with their Common Stock in such manner as they shall
be directed to do so by the Board of Directors of Getty Investments
from time to time.
2.1 Such direction shall be given by notice in writing sent by Getty
Investments to the Party in question. Any such notice may require the
Party in question to appoint any Person nominated by Getty Investments
as such Party's proxy to attend and vote the Common Stock on behalf of
such Party at any shareholders' meeting of Getty Images.
3. PLEDGE OF COMMON STOCK
No Party shall, except with the prior written consent of the other
Parties (such consent not to be unreasonably withheld), pledge,
mortgage, charge or otherwise encumber any Common Stock or any
interest in any Common Stock, or grant an option over any Common Stock
or any interest in any Common Stock.
4. PERMITTED TRANSFERS
4.1 A Party may at any time Transfer all/or any of its Common Stock (the
"RELEVANT STOCK") to a Permitted Transferee. The Permitted Transferee
may at any time Transfer all the Relevant Stock back to the said Party
or another Permitted Transferee of the said Party.
4.2 If Relevant Stock has been Transferred under clause 4.1 (whether
directly or by a series of Transfers) by a Party (the "TRANSFEROR"
which expression shall include a second or subsequent Transferor in
the case of a series of Transfers) to its Permitted Transferee (the
"TRANSFEREE") and subsequently the Transferee ceases to be a Permitted
Transferee pursuant to this Agreement then the Transferee shall
forthwith Transfer the Relevant Stock back to the Transferor or at the
Transferor's option to another Permitted Transferee. If the
Transferee fails to Transfer the Relevant Stock within thirty days of
the Transferee ceasing to be a Permitted Transferee then the
Transferee shall be deemed to have served a Transfer Notice pursuant
to clause 5
<PAGE>
in respect of all the Relevant Stock, with the Transfer Price being
determined pursuant to clause 5.2.3. The Transfer Notice shall not be
withdrawn in any circumstances.
5. TRANSFERS
5.1 Subject to clause 4, a Party (the "VENDOR") who wishes to Transfer any
Common Stock or any interest in any Common Stock shall give notice in
writing (the "TRANSFER NOTICE") to Getty Investments of its desire to
do so.
5.2 The Transfer Notice:
5.2.1 shall specify the identity of a bona fide purchaser (the "PURCHASER")
or that the Common Stock is to be Transferred pursuant to the exercise
of rights under the Registration Rights Agreement or other securities
law exemption;
5.2.2 shall specify the number of shares desired to be Transferred (the
"OFFERED STOCK");
5.2.3 shall specify the bona fide price per share which the Purchaser is
willing to pay for the Offered Stock or in the case of a Transfer
pursuant to the exercise of rights under the Registration Rights
Agreement the average of the Closing Prices on the ten previous
Trading Days;
5.2.4 shall, without prejudice to the right of Getty Investments to purchase
all or any part thereof, constitute Getty Investments by its Directors
as the Vendor's agents to offer and sell the Offered Stock in
accordance with the terms of this Agreement at the price per share
specified in the Transfer Notice; and
5.2.5 shall not be withdrawn except as provided in paragraph 5.5.2(a).
5.3 Getty Investments shall serve a copy of the Transfer Notice on each of
the Parties hereto (other than the Vendor) which are then stockholders
of Getty Images ("MEMBER") which term shall include Getty Investments
if it is then a member of Getty Images with the request that each
Member informs Getty Investments in writing within 7 days whether it
wishes to purchase any of the Offered Stock. Each such Member shall
be entitled to accept (either itself or by nominating one or more
Permitted Transferees) such number of the Offered Stock as bears the
same proportion to the total Offered Stock as the number of shares of
Common Stock already held by such Member calculated as a percentage of
the total Common Stock held by all Members (other than those held by
the Vendor). Any balance of the Offered Stock not so accepted shall
be offered again to the remaining Members who wish to accept (either
themselves or through their nominating one or more Permitted
Transferees) Offered Stock on a similar basis.
5.4 For the purpose of clauses 5.4 to 5.6, the term "the Offer" relates to
any offer pursuant to clause 5.3 and the term "Stockholder" includes
any Person who accepts an offer pursuant to clause 5.3. If the Offer
is accepted in respect of all of the Offered Stock Getty Investments
shall forthwith give notice (the "ALLOCATION NOTICE") of the
<PAGE>
acceptance of the Offer to the Vendor and to each Stockholder. The
Allocation Notice shall specify:
5.4.1 the price of the Offered Stock (the "TRANSFER PRICE");
5.4.2 the number of shares of Offered Stock to be transferred to each
Stockholder to whom the Offered Stock has been allocated; and
5.4.3 the place and time (being not earlier than fourteen and not later than
twenty-eight days after the date of the Allocation Notice) at which
the Transfer Price is to be paid by the Stockholders and the Offered
Stock is to be transferred by the Vendor.
5.5 If the Members or their nominees do not accept the Offer to purchase
all of the Offered Stock in accordance with clauses 5.2 and 5.3, then
the following provisions shall apply:
5.5.1 Getty Investments shall notify that fact to the Vendor; and
5.5.2 the Vendor may either:
(a) withdraw the Transfer Notice and cancel Getty Investments'
authority to sell the Offered Stock by delivering to Getty
Investments a written notice of withdrawal but where applicable
may continue to sell the Offered Stock pursuant to the
Registration Rights Agreement; or
(b) may before the expiration of 30 days after receiving the
notification referred to in paragraph 5.5.1 elect by notice in
writing to Getty Investments to Transfer the Offered Stock which
Members or their nominees have accepted to such Members or their
Nominees in the amounts which they have respectively accepted and
with regard the remainder to the Purchaser at the Transfer Price
and otherwise on terms no more favourable than those offered to
the relevant Members and subject to the condition that the
Purchaser must enter into a deed with the Parties hereto agreeing
to discharge in full any outstanding obligations of the Vendor
towards the Parties hereto and otherwise in accordance with
clause 6.3; and
in all cases the Vendor shall be bound by the applicable provisions of
the Stockholders Agreement.
5.6 The Vendor shall be bound to Transfer such number of the shares of
Offered Stock as have been allocated pursuant to paragraph 5.4 above
against tender of the Transfer Price in accordance with the terms of
the Allocation Notice.
6. TRANSFERS - GENERAL
6.1 An obligation to Transfer an Common Stock pursuant to these provisions
shall be deemed to be an obligation to Transfer the entire legal and
beneficial interest in the
<PAGE>
Common Stock free from all liens, mortgages, charges, encumbrances and
other third party rights of whatever nature.
6.2 The Directors of Getty Images shall register the Transfer of Common
Stock to any Person only if the Transfer has been carried out in
accordance with this Agreement and the Stockholders' Agreement and in
no other circumstances.
6.3 The Parties shall procure that any Transfer or pledge or grant of any
option over Common Stock in accordance with this Agreement and, in the
case of Permitted Transferees, the Stockholders' Agreement shall be
subject to the following conditions which must be satisfied prior to
such Transfer, pledge or grant:
6.3.1 the Transferee, pledgee or grantee shall execute a deed confirming to
the other Parties that it shall be bound by this Agreement and, in the
case of Permitted Transferees, the Stockholders' Agreement in respect
of the Common Stock Transferred, pledged or granted as if it was a
Party; and
6.3.2 the Transferring, pledging or granting Party (which expression shall
include a second or subsequent Transferor, pledgee or grantee in a
series of Transfers, pledges or grants) shall be jointly and severally
liable with the Transferee for its obligations pursuant to this
Agreement and, in the case of Permitted Transferees, the Stockholders'
Agreement.
7. LOCK-UP - CREDITON
7.1 Subject to clause 7.2, in respect of the 50% of the number of shares
of Common Stock set opposite its name in Exhibit A hereto (the
"CREDITON LOCK-UP STOCK"), Crediton agrees not to Transfer (other than
to a Permitted Transferee in accordance with this Agreement) any of
the Crediton Lock-up Stock until 8 July 2001 and thereafter for a
further period of two years not to Transfer (other than to a Permitted
Transferee in accordance with this Agreement) more than 50% of the
Crediton Lock-up Stock.
7.2 The following exceptions to clause 7.1 are hereby agreed:
(a) if Jonathan D. Klein ceases to be employed by the Group then
Crediton will be released from its obligations in clause 7.1;
(b) if any Party other than the October Trust Transfers (other than
to a Permitted Transferee in accordance with this Agreement) any
Common Stock then Crediton will be released from its obligations
under clause 7.1 in respect of such Common Stock that is the same
percentage of all the Crediton Lock-up Stock (or after 8 July
2001 the same percentage as half the Crediton Lock-up Stock), as
the percentage that the Common Stock being sold is of all the
Common Stock held by the Parties other than Crediton and October
Trust; and
<PAGE>
(c) if the Common Stock held by the Parties (other than Crediton and
the October Trust) ceases to represent 7% or more of the total
Common Stock of Getty Images outstanding from time to time then
Crediton shall be released from its obligations under clause 7.1.
7.3 In consideration of the agreement set forth above:
(a) Getty Investments will pay to Crediton an annual fee according to
the Schedule provided in paragraph (b).
(b) The fees payable under paragraph (a) shall be as follows:
YEAR BEGINNING FEE AMOUNT
08/07/97 L267,500 multiplied by (1+2/3 RPI increase from
May 1996 to May 1997)
08/07/98 Fee payable at 08/07/97 multiplied by (1+2/3
RPI increase from May 1997 to May 1998)
08/07/99 Fee payable at 08/07/98 multiplied by
97,000/267,500 and further multiplied by (1+2/3
RPI increase from May 1998 to May 1999)
08/07/00 Fee payable at 08/07/99 multiplied by (1+2/3 RPI
increase from May 1999 to May 2000)
08/07/01 Fee payable at 08/07/00 multiplied by (1+2/3 RPI
increase from May 2000 to May 2001)
08/07/02 Fee payable at 08/07/01 multiplied by (1+2/3 RPI
increase from May 2001 to May 2002)
(c) Such annual fee will be payable in advance on 8 July of each
year.
8. LOCK-UP - OCTOBER TRUST
8.1 Subject to clause 8.2, in respect of 50% of the number of shares of
Common Stock set opposite its name in Exhibit A hereto (the "OCTOBER
LOCK-UP STOCK"), the October Trust agrees not to Transfer (other than
to a Permitted Transferee in accordance with this Agreement) any of
the October Lock-up Stock until 8 July 2001 and thereafter for a
further period of two years not to Transfer (other than to a Permitted
Transferee in accordance with this Agreement) more than 50% of the
October Lock-up Stock.
8.2 The following exceptions to clause 8.1 are hereby agreed:
<PAGE>
(a) if Mark H. Getty ceases to be employed by the Group then the
October Trust will be released from its obligations in clause
8.1;
(b) if any Party other than Crediton Transfers (other than to a
Permitted Transferee in accordance with this Agreement) any
Common Stock then the October Trust will be released from its
obligations under clause 8.1 in respect of the Common Stock that
is the same percentage of all the October Trust Lock-up Stock (or
after 8 July 2001 the same percentage as half the October Trust
Lock-up Stock) as the percentage that the Common Stock being sold
is of all the Common Stock held by the Parties other than
Crediton and October Trust; and
(c) if the Common Stock held by the Parties (other than Crediton and
the October 1993 Trust and their Permitted Transferees) ceases to
represent 7% or more of the total Common Stock of Getty Images
outstanding from time to time then the October Trust shall be
released from its obligations under clause 8.1
8.3 In consideration of the agreement set forth above:
(a) Getty Investments will pay to the October Trust an annual fee
according to the schedule provided in paragraph (b).
(b) The fees payable under paragraph (a) shall be as follows:
YEAR BEGINNING FEE AMOUNT
08/07/97 L77,500 multiplied by (1+2/3 RPI
increase from May 1996 to May 1997)
08/07/98 Fee payable at 08/07/97 multiplied by
(1+2/3 RPI increase from May 1997 to May
1998)
08/07/99 Fee payable at 08/07/98 multiplied by
28,000/77,500 and further multiplied by
(1+2/3 RPI increase from May 1998 to May
1999)
08/07/00 Fee payable at 08/07/99 multiplied by
(1+2/3 RPI increase from May 1999 to May
2000)
08/07/01 Fee payable at 08/07/00 multiplied by
(1+2/3 RPI increase from May 2000 to May
2001)
08/07/02 Fee payable at 08/07/01 multiplied by
(1+2/3 RPI increase from May 2001 to May
2002)
(c) such annual fee will be payable in advance on 8 July of each
year.
<PAGE>
9. SPECIAL LOCK-UP
9.1 Subject to paragraph 9.2, in respect of all and any shares of Common
Stock (the "LOCK-UP STOCK"), each of J.D. Klein, Crediton, M.H. Getty
and the October Trust (together the "COVENANTEES") hereto agree not to
Transfer (other than to a Permitted Transferee in accordance with this
Agreement any of the Lock-up Stock until the later of the announcement
by Getty Images of its results for the second quarter of 1998 and 9
August 1998.
9.2 clause 9.1 does not apply to the transfer of up to 60,000 shares of
Common Stock of Getty Images in aggregate by:
9.2.1 J.D. Klein and Crediton; or
9.2.2 M.H. Getty and the October Trust.
9.3 Each of the Covenantees hereby agrees with Getty Investments that in
the event of any proposed Transfer (other than to a Permitted
Transferee in accordance with this Agreement) it shall give Getty
Investments at least 10 days notice of such proposed Transfer and
shall consult with Getty Investments about the reasons for, manner of
and timing of such proposed Transfer.
10. STOCK CERTIFICATE LEGEND
All certificates representing shares of Common Stock shall bear, in
addition to other legends required under applicable securities laws,
the following legend:
"The shares represented by this certificate are subject to
the provisions of the Getty Parties Shareholders' Agreement
dated as of 9 February 1998 among certain stockholders of
Getty Images, Inc."
11. NON-COMPETITION
11.1 RESTRICTIONS ON COMPETITION BY GETTY INVESTMENTS
Getty Investments agrees that neither it nor any Affiliates in which
it has a controlling interest shall (i) own directly or indirectly
assets comprising a visual content business as described in the
Prospectus other than through its relationship with Getty Images or
(ii) acquire an equity interest in any Person if at the time of such
acquisition such Person directly or indirectly through one or more
Affiliates in which it has a controlling interest owns any visual
content business as described in the Prospectus.
11.2 Nothing contained in this clause 11 shall prohibit or otherwise
restrict the ownership or acquisition of 10% or less of the
outstanding equity of a Person that engages in the visual content
business directly or indirectly as described in the Prospectus.
<PAGE>
12. APPOINTMENT OF CHAIRMAN OF GETTY IMAGES
Getty Images hereby agrees that, subject to the terms of the
Stockholders' Agreement, it shall take all necessary steps to ensure
the appointment of any person nominated to be chairman of Getty Images
by Getty Investments pursuant to the by-laws of Getty Images provided
that for so long as either Mark Torrance or Mark Getty are co-chairman
of the board such right shall not be in effect.
13. TERM
This Agreement has a term of seven years from 8 July 1996 (the
"INITIAL TERM"), unless terminated earlier pursuant to clause 14.
14. TERMINATION
14.1 CESSATION OF OWNERSHIP
This Agreement shall be terminated with immediate effect in respect of
any Party when it and its Permitted Transferees cease to be Members of
Getty Images; or
14.2 REDUCTION IN HOLDING OF GETTY IMAGES
This Agreement shall be terminated with immediate effect if the Common
Stock held by the Parties ceases to represent beneficially fewer than
the greater of 3,000,000 shares of Common Stock and such number of
shares as is equal to 2% or less of the then outstanding shares of
Common Stock.
14.3 For the purposes of this clause 14, Getty Images shall include any
corporation into which Getty Images may merge into or consolidate with
and in such case the term Common Stock shall mean and include the
shares of stock of such successor entity exchanged for such Common
Stock.
15. CONSEQUENCES OF TERMINATION
15.1 Subject to clause 15.2, each Party's further rights and obligations
cease immediately on termination of this Agreement, but termination
does not affect a Party's accrued rights and obligations at the date
of termination.
15.2 Upon the occurrence of the termination of this Agreement pursuant to
clause 14.1 or 14.2 an event set out in clause 14 above, Getty
Investments shall pay to Crediton and October Trust respectively any
outstanding fees together with all fees payable by Getty Investments
in respect of the entire period of the Agreement.
16. FURTHER ASSURANCE
Each party shall at its own cost do and execute, or arrange for the
doing and executing of, each necessary act, document and thing
reasonably within its power to implement this Agreement.
<PAGE>
17. GENERAL
17.1 This Agreement and any document referred to in this Agreement and
other documents constitute the entire agreement, and supersede any
previous agreement, between the parties relating to the subject matter
of this Agreement.
17.2 A variation of this Agreement is valid only if it is in writing and
signed by or on behalf of each party.
17.3 The failure to exercise or delay in exercising a right or remedy
provided by this Agreement or by law does not constitute a waiver of
the right or remedy or a waiver of other rights or remedies. No
single or partial exercise of a right or remedy provided by this
Agreement or by law prevents further exercise of the right or remedy
or the exercise of another right or remedy.
17.4 No provision of this Agreement creates a partnership between the
parties or makes a party the agent of the other party for any purpose.
A party has no authority or power to bind, to contract in the name of,
or to create a liability for the other party in any way or for any
purpose.
18. RESTRICTIVE TRADE PRACTICES ACT
Any provision contained in this Agreement or in any arrangement of
which this Agreement forms part by virtue of which this Agreement or
such arrangement is subject to registration under the Restrictive
Trade Practices Acts 1976 and 1977 shall not come into effect until
the day following the date on which particulars of this Agreement and
of any such arrangement have been furnished to the Office of the
Director General of Fair Trading in accordance with the requirements
of such Acts.
19. SATISFACTION OF LEGAL REQUIREMENTS
Notwithstanding any other provision of this Agreement, no Stockholder
may Transfer any Common Stock unless it has complied with all
applicable legal requirements, including without limitation applicable
United States federal and state securities laws.
20. ASSIGNMENT
20.1 A Party may not assign or transfer or purport to assign or transfer a
right or obligation under this Agreement except to a Permitted
Transferee. Each Party is entering into this Agreement for its
benefit and not for the benefit of another Person.
21. NOTICES
21.1 A notice or other communication under or in connection with this
Agreement shall be in writing and may be delivered personally or sent
by first class post or by fax, as follows:
21.1.1 if to Getty Investments to:
<PAGE>
Address: 1325 Airmotive Way, Suite 262
Reno
Nevada 89502-3240
Fax: + 1 702 786 5414
Marked for the attention of Jan Moehl and Mark Jenness
21.1.2 If to the Investors to the address specified for such Person in
Exhibit A hereto with a copy to:
Address: Clifford Chance
200 Aldersgate Street
London EC1A 4JJ
Fax: + 44 171 956 0181
Marked for the attention of: Michael Francies
21.1.3 If to Getty Images to:
Address: 101 Bayham Street
London
NW1 0AG
England
Fax: + 44 171 267 6540
Marked for the attention of Jonathan Klein
or to another Person, address or fax number specified by a party by
written notice to the other.
21.2 In the absence of evidence of earlier receipt, a notice or other
communication is deemed given:
21.2.1 if delivered personally, when left at the address referred to in
clause 21.1
21.2.2 if sent by fax, one hour after its despatch.
22. GOVERNING LAW
22.1 This Agreement is governed exclusively by Delaware law.
22.2 Arbitration - To the fullest extent permitted by law, any controversy
or claim arising out of or relating to this Agreement, or the breach
thereof shall be settled by mandatory, final and binding arbitration
in New York City, New York, USA under the auspices and in accordance
with the rules, then obtaining, of the American Arbitration
Association to the extent not inconsistent with the Delaware Uniform
Arbitration Act, and judgment upon the award rendered may be entered
in any court having jurisdiction thereof. Reasonable fees, costs and
expenses, including legal fees,
<PAGE>
incurred by any Party in connection with such arbitration shall be
borne by Getty Investments. Nothing in this paragraph 22.2 shall
limit any right that any Party may otherwise have to seek (on its own
behalf or in the right of Getty Investments) to obtain preliminary
injunctive relief in order to preserve the status quo pending the
disposition of any such arbitration proceeding.
23. COUNTERPARTS
This Agreement may be executed in any number of counterparts each of
which when executed and delivered is an original, but all the
counterparts together constitute the same document.
24. POWER TO APPOINT, REMOVE AND REPLACE A DIRECTOR OF GETTY INVESTMENTS
24.1 Each of Crediton and the October Trust shall have the right to
nominate one Person who is willing so to act, as a director of Getty
Investments and to nominate for removal and replacement the Person so
nominated by each of them.
24.2 Any nomination pursuant to clause 24.1 shall be effected by notice to
Getty Investments signed by or on behalf of the nominator. The notice
shall be left at or sent by post or facsimile transmission to the
office or such other place designated by the board for the purpose.
The nomination shall take effect as of the deposit of the notice or
such later date (if any) specified in the notice. The first director
nominated by the October Trust shall be Mark H. Getty and the first
director nominated by Crediton shall be Jonathan D. Klein.
25. CHAIRMAN OF BOARD OF GETTY INVESTMENTS
25.1 The October Trust shall have the right to nominate, out of the
directors of Getty Investments from time to time, a Person who is
willing so to act, as Chairman of Getty Investments and to removal and
replacement of the Person that is nominated as Chairman by it. The
first person nominated Chairman by October Trust shall be Mark H.
Getty.
25.2 Any nomination as Chairman pursuant to clause 25.1 shall be effected
by notice to Getty Investments signed by or on its behalf. The notice
shall be left at or sent by post or facsimile transmission to the
office or such other place designated by the board for the purpose.
The nomination shall take effect immediately on deposit of the notice
or on such later date (if any) specified in any notice.
<PAGE>
EXECUTED by the parties as follows:
Signed by )
a duly authorised )
representative for and )
on behalf of )
Crediton Limited )
/s/ JH Cannell - Director Signature
- ------------------------------
Signed by )
a duly authorised )
representative for and )
on behalf of )
Abacus (C.I.) Limited as the )
Trustees of The October )
1993 Trust )
/s/ Authorized Signatory Signature
- ------------------------------
<PAGE>
Signed by )
a duly authorised )
representative for and )
on behalf of )
Getty Investments L.L.C. )
/s/ Authorized Signatory Signature
- ------------------------------
Signed by )
a duly authorised )
representative for and )
on behalf of )
Getty Images, Inc. )
/s/ Authorized Signatory Signature
- ------------------------------
Signed by
MARK GETTY
/s/ Mark Getty Signature
- ------------------------------
Signed by
JONATHAN KLEIN
/s/ Jonathan Klein Signature
- ------------------------------
<PAGE>
EXHIBIT A
THE INVESTORS
NOTICE ADDRESS
NAME NOTICE ADDRESS NO. OF SHARES
CREDITON LIMITED 60 Circular Road 622,602 Common
Douglas Shares
Isle of Man
IM1 1SA
ABACUS (C.I.) LTD AS THE La Motte Chambers 622,602 Common Shares
TRUSTEE OF THE OCTOBER St Helier
1993 TRUST Jersey
JE1 1BJ
<PAGE>
REGISTRATION RIGHTS AGREEMENT
REGISTRATION RIGHTS AGREEMENT, dated as of July 3, 1996 (this "Agreement"),
between Getty Communications plc, a public limited company organized under the
laws of England and Wales (the "Company"), and each of Lawrence J. Gould, Simon
C. Thornley, Brian K. Wolske, Mark H. Getty and Jonathan D. Klein (the
"Directors").
WHEREAS, the Company has determined that it is in the best interests of the
Company to offer Class A Ordinary Shares of the Company (the "Class A Shares"
and, together with the Class B Ordinary Shares of the Company, the "Ordinary
Shares") in the form of American Depositary Shares in the United States (the
"Offering") pursuant to the filing of a Form F-1 Registration Statement under
the United States Securities Act of 1933, as amended (the "Securities Act"); and
WHEREAS, after the consummation of the Offering, the Directors will own
2,272,906 Class A Shares (the "Remaining Shares") and 2,490,408 Class B Shares
(the "Conversion Shares"); and
WHEREAS, the parties each desire to make certain covenants and agreements
concerning the registration from time to time of the Registrable Shares (as
defined below) under the Securities Act.
NOW, THEREFORE, in consideration of the mutual promises, representations,
warranties and conditions contained herein, the parties hereto agree as follows:
ARTICLE I
DEFINITIONS
SECTION 1.01. As used in this Agreement, the following terms shall have
the following respective meanings:
"AFFILIATE" of a Holder shall mean a direct or indirect
subsidiary of such Holder or if such Holder is an individual, the spouse or
children (or a trust exclusively for the benefit of a spouse and/or
children) of such Holder.
"COMMISSION" shall mean the United States Securities and Exchange
Commission, or any other United States federal agency at the time
administering the Securities Act or the Exchange Act, as applicable,
whichever is the relevant statute.
"EXCHANGE ACT" shall mean the United States Securities Exchange
Act of 1934, or any similar federal statute, and the rules and regulations
of the Commission thereunder, all as the same shall be amended from time to
time.
<PAGE>
2
"HOLDER" shall mean, with respect to a Tax Demand Right (as
defined in Section 3.01 hereunder) each Director, or any transferee or
assignee thereof to whom the rights under this Agreement are assigned by
each such Director in accordance with the provisions of Section 4.06
hereof, and with respect to any other Demand Right, Mr. Lawrence J. Gould,
Mr. Simon C. Thornley and Mr. Brian K. Wolske or any transferee or assignee
thereof to whom the rights under this Agreement are assigned by each such
Director in accordance with the provisions of Section 4.06 hereof.
"PERSON" shall mean a corporation, association, partnership,
organization, group (as such term is used in Rule 13d-5 under the Exchange
Act), business, individual, government or political subdivision thereof,
governmental agency or other entity.
"REGISTRABLE SHARES" shall mean (i) the Remaining Shares and the
Conversion Shares, (ii) any Ordinary Shares issued as (or issuable upon the
conversion or exercise of any warrant, right, option or other convertible
security which is issued as) a dividend or other distribution with respect
to, or in exchange for, or in replacement of, the Remaining Shares and the
Conversion Shares and (iii) any Ordinary Shares issued by way of a stock
split of the Remaining Shares and the Conversion Shares referred to in
clauses (i) or (ii) above. For purposes of this Agreement, any Registrable
Shares shall cease to be Registrable Shares when (x) a registration
statement covering such Registrable Shares have been declared effective and
such Registrable Shares have been disposed of pursuant to such effective
registration statement and (y) such Registrable Shares are sold freely in
the public market by a person in a transaction in which the rights under
the provisions of this Agreement are not assigned.
ARTICLE II
REPRESENTATIONS AND WARRANTIES
SECTION 2.01. REPRESENTATIONS AND WARRANTIES OF EACH DIRECTOR. Each
Director, severally, hereby represents and warrants to the Company that this
Agreement has been duly authorized, executed and delivered by each such Director
and constitutes a valid and binding agreement enforceable against it in
accordance with its terms.
SECTION 2.02. REPRESENTATIONS AND WARRANTIES OF THE COMPANY. The Company
represents and warrants to each Director that it has been duly organized and is
an existing corporation in good standing under the laws of England and Wales and
that (i) it has all requisite corporate power and authority, and has received
all requisite approvals (including any necessary approval of its board of
directors) to complete the transactions contemplated hereby and (ii) this
Agreement has been duly authorized, executed and delivered by it and
<PAGE>
3
constitutes a valid and binding agreement enforceable by each Director against
it in accordance with its terms.
ARTICLE III
AGREEMENTS IN RESPECT OF THE REGISTRABLE SHARES
SECTION 3.01. DEMAND REGISTRATIONS. (a) The Holder shall have the right
(the "Demand Right") on (i) one occasion in July 1997 in respect of Mr. Lawrence
J. Gould, Mr. Simon C. Thornley or Mr. Brian K. Wolske or within 12 months of
the date of exercise of any stock options in respect of Mr. Jonathan D. Klein
and Mr. Mark H. Getty, in order to sell Registrable Shares to raise an amount
equal to or less than the tax payable on the exercise of their stock options of
the Company (the "Tax Demand Right"), and (ii) one occasion within 90 days
following the date that Mr. Lawrence J. Gould, Mr. Simon C. Thornley, Mr. Brian
K. Wolske, Mr. Jonathan D. Klein or Mr. Mark H. Getty, as the case may be,
ceases to be employed by the Company, to require the Company to file a
registration statement under the Securities Act in respect of all of the
Registrable Shares held by such Holder; PROVIDED, HOWEVER, that if such Holder
is exercising such Demand Right together with any other Holder's demand right,
then it may be exercised if the Registrable Shares and the other shares demanded
by the other Holders shall exceed five percent of the outstanding Ordinary
Shares of the Company. As promptly as practicable, but in no event later than
30 days after the Company receives a written request from such Holder demanding
that the Company so register the number of Registrable Shares specified in such
request, the Company shall file with the Commission and thereafter use its best
efforts to cause to be declared effective promptly a registration statement (a
"Demand Registration") providing for the registration of all Registrable Shares
as such Holder shall have demanded be registered.
(b) Anything in this Agreement to the contrary notwithstanding, the
Company shall be entitled to postpone and delay, for a reasonable period of
time, not to exceed 45 days (the "Blackout Period"), the filing of any Demand
Registration if (i) the Company is conducting or about to conduct an
underwritten public offering of securities in which the Holder is entitled to
join pursuant to Section 3.02 hereof, (ii) the Company is subject to an existing
contractual obligation not to engage in a public offering, or (iii) the Company
shall determine that any such filing or the offering of any Registrable Shares
would (x) in the good faith judgment of the Board of Directors of the Company,
impede, delay or otherwise interfere with any pending or contemplated financing,
acquisition, corporate reorganization or other similar transaction involving the
Company, (y) based upon advice from the Company's investment banker or financial
advisor, adversely affect any pending or contemplated offering or sale of any
class of securities by the Company, or (z) require disclosure of material
nonpublic information which, if disclosed at such time, would be materially
harmful to the interests of the Company and its shareholders; PROVIDED, HOWEVER,
that the Blackout Period shall terminate upon the completion or abandonment of
the relevant securities offering or sale, the termination or expiration of the
existing
<PAGE>
4
contractual obligation to its underwriters not to engage in a public offering,
the completion or abandonment of the relevant financing, acquisition, corporate
reorganization or other similar transaction, such time as such Demand
Registration shall no longer affect the relevant pending or contemplated
offering of securities by the Company, or the public disclosure by the Company
or public admission by the Company of such material nonpublic information or
such time as such material nonpublic information shall be publicly disclosed
without breach of the last sentence of this subsection (b), as the case may be.
After the expiration of any Blackout Period and without any further request from
a Holder, the Company shall effect the filing of the relevant Demand
Registration and shall use its best efforts to cause any such Demand
Registration to be declared effective as promptly as practicable unless such
Holder shall have, prior to the effective date of such Demand Registration,
withdrawn in writing its initial request, in which case such withdrawn request
shall not constitute a Demand Registration for purposes of determining the
number of Demand Registrations to which such Holder is entitled to hereunder.
(c) Except with respect to any request by a Holder for a Demand
Registration which is subsequently withdrawn prior to such Demand Registration
becoming due to (i) a material adverse change affecting the Company or capital
markets generally, or (ii) a notification by the Company of an intention to file
a registration statement with respect to the Class A Shares, such Holder shall
share equally with the Company all expenses relating to the preparation of such
withdrawn Demand Registration.
SECTION 3.02. INCIDENTAL REGISTRATION. (a) If, at any time following the
date of the Offering and up to and including 30 days after the date that Mr.
Lawrence J. Gould, Mr. Simon C. Thornley or Mr. Brian K. Wolske, as the case may
be, ceases to be employed by the Company, the Company proposes to file a
registration statement under the Securities Act with respect to an offering of
its Class A Shares (i) for its own account (other than a registration statement
on Form S-4 or S-8 (or any substitute form that may be adopted by the
Commission)) or (ii) for the account of any holders of its Class A Shares
(including any pursuant to a demand registration), the Company shall give
written notice of such proposed filing to each Holder as soon as practicable
(but in any event not less than 30 days before the anticipated filing date), and
such notice shall offer each Holder the opportunity to register such number of
Registrable Shares as the Holder shall request. Upon the written direction of
any Holder, given within 20 days following the receipt by such Holder of any
such written notice (which direction shall specify the number of Registrable
Shares intended to be disposed of by such Holder), the Company shall include in
such registration statement (an "Incidental Registration" and, collectively with
a Demand Registration, a "Registration") such number of Registrable Shares as
shall be set forth in such notice. Notwithstanding anything contained herein,
if the lead underwriter of an offering involving an Incidental Registration
delivers a written opinion to the Company that the inclusion of such Registrable
Shares would (i) materially and adversely affect the price of the Class A Shares
to be offered or (ii) result in a greater amount of Class A Shares being offered
than the market could reasonably absorb, then the number of Registrable Shares
to be registered by each party requesting Incidental Registration rights shall
be reduced in proportion to the number of securities originally requested to be
registered by
<PAGE>
5
each of them. Nothing contained herein shall require the Company to reduce the
number of Class A Shares proposed to be issued by the Company.
(b) No Incidental Registration effected under this Section 3.02 shall be
deemed to have been effected pursuant to Section 3.01 hereof or shall release
the Company of its obligations to effect any Demand Registration upon request as
provided under Section 3.01 hereof.
SECTION 3.03. REGISTRATION PROCEDURES. (a) In connection with each
Registration, and in accordance with the intended method or methods of
distribution of the Class A Shares as described in such Registration, the
Company shall, as soon as reasonably practicable (and, in any event, subject to
the terms of this Agreement, including, without limitation, Section 3.01(a)
hereof, at or before the time required by applicable laws and regulations):
(a) prepare and file with the Commission a registration statement
with respect to such Registrable Shares and use its best efforts to cause
such registration statement to become and remain effective for the period
of the distribution contemplated thereby determined as provided hereafter;
(b) prepare and file with the Commission such amendments and
supplements to such registration statement and the prospectus used in
connection therewith as may be necessary to comply with the provisions of
the Securities Act with respect to the disposition of all Registrable
Shares covered by such registration statement;
(c) furnish to the Holder such numbers of copies of the registration
statement and the prospectus included therein (including each preliminary
prospectus and any amendments or supplements thereto), in conformity with
the requirements of the Securities Act and such other documents and
information as it may reasonably request;
(d) use its best efforts to register or qualify the Registrable
Shares covered by such registration statement under such other securities
or blue sky laws of such jurisdiction within the United States and Puerto
Rico as shall be reasonably appropriate for the distribution of the
Registrable Shares covered by the registration statement; PROVIDED,
HOWEVER, that the Company shall not be required in connection therewith or
as a condition thereto to qualify to do business in or to file a general
consent to service of process in any jurisdiction wherein it would not but
for the requirements of this paragraph (d) be obligated to do so; and
PROVIDED, FURTHER, that the Company shall not be required to qualify such
Registrable Shares in any jurisdiction in which the securities regulatory
authority requires that the Holder submit any of its Registrable Shares to
the terms, provisions and restrictions of any escrow, lockup or similar
agreement(s) for consent to sell Registrable Shares in such jurisdiction
unless such Holder agrees to do so;
<PAGE>
6
(e) promptly notify each Holder, at any time when a prospectus
relating to the Registrable Shares is required to be delivered under the
Securities Act, of the happening of any event as a result of which the
prospectus included in such registration statement, as then in effect,
includes an untrue statement of a material fact or omits to state any
material fact required to be stated therein or necessary to make the
statements therein not misleading in light of the circumstances under which
they were made, and at the request of any such Holder promptly prepare and
furnish to such Holder a reasonable number of copies of a supplement to or
an amendment of such prospectus as may be necessary so that, as thereafter
delivered to the purchasers of such securities, such prospectus shall not
include an untrue statement of a material fact or omit to state a material
fact required to be stated therein or necessary to make the statements
therein not misleading in light of the circumstances under which they were
made;
(f) furnish, at the request of any Holder requesting registration of
Registrable Shares pursuant to Sections 3.01 or 3.02 hereof, if the method
of distribution is by means of an underwriting, on the date that the
Registrable Shares are delivered to the underwriters for sale pursuant to
such registration, or if such Registrable Shares are not being sold through
underwriters, on the date that the registration statement with respect to
such Registrable Shares becomes effective, (1) a signed opinion, dated such
date, of the independent legal counsel representing the Company for the
purpose of such registration, addressed to the underwriters, if any, and if
such Registrable Shares are not being sold through underwriters, then to
the Holders making such request, as to such matters as such underwriters or
the Holders holding a majority of the Registrable Shares included in such
registration, as the case may be, may reasonably request and as would be
customary in such a transaction; and (2) letters dated such date and the
date the offering is priced from the independent certified public
accountants of the Company, addressed to the underwriters, if any, and if
such Registrable Shares are not being sold through underwriters, then to
the Holders making such request and, if such accountants refuse to deliver
such letters to such Holders, then to the Company (i) stating that they are
independent certified public accountants within the meaning of the
Securities Act and that, in the opinion of such accountants, the financial
statements and other financial data of the Company included in the
registration statement or the prospectus, or any amendment or supplement
thereto, comply as to form in all material respects with the applicable
accounting requirements of the Securities Act and (ii) covering such other
financial matters (including information as to the period ending not more
than five (5) business days prior to the date of such letters) with respect
to the registration in respect of which such letter is being given as such
underwriters or the Holders holding a majority of the Registrable Shares
included in such registration, as the case may be, may reasonably request
and as would be customary in such a transaction;
(g) enter into customary agreements (including if the method of
distribution is by means of an underwriting, an underwriting agreement in
<PAGE>
7
customary form) and take such other actions as are reasonably required in
order to expedite or facilitate the disposition of the Registrable Shares
to be so included in the registration statement;
(h) otherwise use its best efforts to comply with all applicable
rules and regulations of the Commission, and make available to its security
holders, as soon as reasonably practicable, but not later than eighteen
(18) months after the effective date of the registration statement, an
earnings statement covering the period of at least twelve (12) months
beginning with the first full month after the effective date of such
registration statement, which earnings statements shall satisfy the
provisions of Section 11(a) of the Securities Act; and
(i) use its best efforts to list the Class A Shares covered by such
registration statement with any securities exchange on which the Class A
Shares are then listed.
(b) Each Holder requesting registration shall furnish to the Company in
writing such information regarding such Holder and its intended method of
distribution of the Registrable Shares as the Company may from time to time
reasonably request in writing, but only to the extent that such information is
required in order for the Company to comply with its obligations under all
applicable securities and other laws and to ensure that the prospectus relating
to such Registrable Shares conforms to the applicable requirements of the
Securities Act and the rules and regulations thereunder. Such Holder shall
notify the Company as promptly as practicable of any inaccuracy or change in
information previously furnished by such Holder to the Company or of the
occurrence of any event, in either case as a result of which any prospectus
relating to the Registrable Shares contains or would contain an untrue statement
of a material fact regarding such Holder or its intended method of distribution
of such Registrable Shares or omits to state any material fact regarding such
Holder or its intended method of distribution of such Registrable Shares
required to be stated therein or necessary to make the statements therein, in
the light of the circumstances under which they were made, not misleading, and
promptly furnish to the Company any additional information required to correct
and update any previously furnished information, or required so that such
prospectus shall not contain, with respect to such Holder or the intended method
of distribution of the Registrable Shares, an untrue statement of a material
fact or omit to state a material fact required to be stated therein or necessary
to make the statements therein, in the light of the circumstances under which
they were made, not misleading.
SECTION 3.05. REGISTRATION EXPENSES. All expenses, excluding
underwriters' discounts and commissions and any stamp or transfer taxes or duty,
but including without limitation all registration, filing and qualification
fees, word processing, duplicating, printers' and accounting fees (including the
expenses of any special audits or "cold comfort" letters required by or incident
to such performance and compliance), fees of the National Association of
Securities Dealers, Inc. or listing fees, messenger and delivery expenses, all
fees and expenses of complying with state securities or blue sky laws, fees
<PAGE>
8
and disbursements of one counsel for the Holders and fees and disbursements of
counsel for the Company incurred in connection with each registration shall be
paid by the Company. Each Holder shall bear and pay the underwriting
commissions and discounts and any stamp or transfer tax or duty and the fees and
disbursements of counsel for the Holders other than the one counsel referred to
above incurred in connection with each registration applicable to securities
offered for its account in connection with any registrations, filings and
qualifications made pursuant to this Agreement.
SECTION 3.06. INDEMNIFICATION; CONTRIBUTION. (a) INDEMNIFICATION BY THE
COMPANY. The Company shall, and it hereby agrees to, indemnify and hold
harmless each Holder, such Holder's directors and officers, and each person who
participates as a placement or sales agent or as an underwriter in any offering
or sale of the Registered Shares, against any losses, claims, damages or
liabilities to which such Holder or such agent or underwriter may become
subject, insofar as such losses, claims, damages or liabilities (or actions or
proceedings in respect thereof) arise out of or are based upon an untrue
statement or alleged untrue statement of a material fact contained in any
Registration, or any preliminary or final prospectus contained therein, or any
amendment or supplement thereto, or any document incorporated by reference
therein, or arise out of or are based upon any omission or alleged omission to
state therein a material fact required to be stated therein or necessary to make
the statements therein not misleading, and the Company shall, and it hereby
agrees to, reimburse each such Holder or any such agent or underwriter for any
legal or other out-of-pocket expenses reasonably incurred by them (but not in
excess of expenses incurred in respect of one counsel for all of them unless
there is an actual conflict of interest between any indemnified parties, which
indemnified parties may be represented by separate counsel) in connection with
investigating or defending any such action, proceeding or claim; PROVIDED,
HOWEVER, that the indemnity agreement contained in this Section 3.06(a) shall
not apply to amounts paid in settlement of any such loss, claim, damage,
liability or action if such settlement is effected without the consent of the
Company which consent shall not be unreasonably withheld; PROVIDED, FURTHER,
that the Company shall not be liable to any such person in any such case to the
extent that any such loss, claim, damage, liability or expense arises out of or
is based upon an untrue statement or alleged untrue statement or omission or
alleged omission made in such Registration, or preliminary or final prospectus,
or amendment or supplement thereto, in reliance upon and in conformity with
written information furnished to the Company by such Holder or any agent,
underwriter or representative of such Holder expressly for use therein, or by
such Holder's failure to furnish the Company, upon request, with the information
with respect to such Holder, such Holder's directors and officers, or any agent,
underwriter or representative of such Holder, or such Holder's intended method
of distribution, that is the subject of the untrue statement or omission or if
the Company shall sustain the burden of proving that such Holder, such Holder's
directors and officers, or such agent or underwriter sold securities to the
person alleging such loss, claim, damage or liability without sending or giving,
at or prior to the written confirmation of such sale, a copy of the applicable
prospectus (excluding any documents incorporated by reference therein) or of the
applicable prospectus, as then amended or supplemented (excluding any documents
incorporated by reference therein) if the Company had previously furnished
copies thereof
<PAGE>
9
to the such Holder or such agent or underwriter, and such prospectus corrected
such untrue statement or alleged untrue statement or omission or alleged
omission made in such Registration.
(b) INDEMNIFICATION BY THE HOLDER AND ANY AGENT OR UNDERWRITERS. Each
Holder requesting or joining in a Registration shall severally and not jointly
indemnify and hold harmless the Company, each of its directors and officers,
each person, if any, who controls the Company within the meaning of the
Securities Act, and each agent and any underwriter for the Company (within the
meaning of the Securities Act) against any losses, claims, damages or
liabilities, joint or several, to which the Company or any such director,
officer, controlling person, agent or underwriter may become subject, under the
Securities Act or otherwise, insofar as such losses, claims, damages or
liabilities (or proceedings in respect thereof) arise out of or are based upon
any untrue statement or alleged untrue statement of any material fact contained
in such registration statement on the effective date thereof (including any
prospectus filed under Rule 424 under the Securities Act or any amendments or
supplements thereto) or arise out of or are based upon the omission or alleged
omission to state therein a material fact required to be stated therein or
necessary to make the statements therein not misleading, in each case to the
extent, but only to the extent, that such untrue statement or alleged untrue
statement or omission or alleged omission was made in such registration
statement, preliminary or final prospectus, or amendments or supplements
thereto, in reliance upon and in conformity with written information furnished
by or on behalf of such Holder expressly for use in connection with such
Registration; and each such Holder shall reimburse any legal or other expenses
reasonably incurred by the Company or any such director, officer, controlling
person, agent or underwriter (but not in excess of expenses incurred in respect
of one counsel for all of them unless there is an actual conflict of interest
between any indemnified parties, which indemnified parties may be represented by
separate counsel) in connection with investigating or defending any such loss,
claim, damage, liability or action; PROVIDED, HOWEVER, that the indemnity
agreement contained in this Section 3.06(b) shall not apply to amounts paid in
settlement of any such loss, claim, damage, liability or action if such
settlement is effected without the consent of such Holder (which consent shall
not be unreasonably withheld).
(c) NOTICE OF CLAIMS, ETC. Promptly after receipt by an indemnified party
under subsection (a) or (b) above of written notice of the commencement of any
action or proceeding for which indemnification under subsection (a) or (b) may
be requested, such indemnified party shall, without regard to whether a claim in
respect thereof is to be made against an indemnifying party pursuant to the
indemnification provisions of, or as contemplated by, this Section 3.06, notify
such indemnifying party in writing of the commencement of such action or
proceeding; but the omission so to notify the indemnifying party shall not
relieve it from any liability which it may have to any indemnified party in
respect of such action or proceeding on account of the indemnification
provisions of or contemplated by Section 3.06(a) or 3.06(b) hereof unless the
indemnifying party was materially prejudiced by such failure of the indemnified
party to give such notice, and in no event shall such omission relieve the
indemnifying party from any other
<PAGE>
10
liability it may have to such indemnified party. In case any such action or
proceeding shall be brought against any indemnified party and it shall notify an
indemnifying party of the commencement thereof, such indemnifying party shall be
entitled to participate therein and, to the extent that it shall determine,
jointly with any other indemnifying party similarly notified, to assume the
defense thereof, with counsel reasonably satisfactory to such indemnified party,
and, after notice from the indemnifying party to such indemnified party of its
election so to assume the defense thereof, such indemnifying party shall not be
liable to such indemnified party for any legal or any other expenses
subsequently incurred by such indemnified party, in connection with the defense
thereof other than reasonable costs of investigation (unless such indemnified
party reasonably objects to such assumption on the grounds that there may be
defenses available to it which are different from or in addition to the defenses
available to such indemnifying party, in which event the indemnified party shall
have the right to control its defense and shall be reimbursed by the
indemnifying party for the expenses incurred in connection with retaining
separate counsel). If the indemnifying party is not entitled to, or elects not
to, assume the defense of a claim, it will not be obligated to pay the fees and
expenses of more than one counsel (in addition to local counsel) for each
indemnified party with respect to such claim. The indemnifying party will not
be subject to any liability for any settlement made without its consent, which
consent shall not be unreasonably withheld or delayed. No indemnifying party
will consent to entry of any judgment or enter into any settlement agreement
which does not include as an unconditional term thereof the giving by the
claimant or plaintiff to such indemnified party of a release from all liability
in respect of such claim or litigation.
(d) CONTRIBUTION. Each Holder requesting or joining in a Registration and
the Company agree that if, for any reason, the indemnification provisions
contemplated by Section 3.06(a) or Section 3.06(b) hereof are unavailable to or
are insufficient to hold harmless an indemnified party in respect of any losses,
claims, damages or liabilities (or actions or proceedings in respect thereof)
referred to therein, then each indemnifying party shall contribute to the amount
paid or payable by such indemnified party as a result of such losses, claims,
damages or liabilities (or actions or proceedings in respect thereof) in such
proportion as is appropriate to reflect the relative fault of, and benefits
derived by, the indemnifying party and the indemnified party, as well as any
other relevant equitable considerations. The relative fault of such
indemnifying party and indemnified party shall be determined by reference to,
among other things, whether the untrue or alleged untrue statement of a material
fact or omission or alleged omission to state a material fact relates to
information supplied by such indemnifying party or by such indemnified party,
and the parties' relative intent, knowledge, access to information and
opportunity to correct or prevent such statement or omission. The parties
hereto agree that it would not be just and equitable if contribution pursuant to
this Section 3.06(d) were determined (i) by pro rata allocation (even if the
Holder or any agents for, or underwriters of, the Registrable Shares, or all of
them, were treated as one entity for such purpose); or (ii) by any other method
of allocation which does not take account of the equitable considerations
referred to in this Section 3.06(d). The amount paid or payable by an
indemnified party as a result of the losses, claims, damages or liabilities (or
actions or proceedings in respect thereof) referred to above shall be deemed to
include (subject to the limitations set forth in Section 3.06(c)
<PAGE>
11
hereof) any legal or other fees or expenses reasonably incurred by such
indemnified party in connection with investigating or defending any such action,
proceeding or claim. 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.
(e) BENEFICIARIES OF INDEMNIFICATION. The obligations of the Company
under this Section 3.06 shall be in addition to any liability that it may
otherwise have and shall extend, upon the same terms and conditions, to each
officer, director and partner of the each Holder requesting or joining in a
Registration and each agent and underwriter of the Registrable Shares and each
person, if any, who controls such Holder or any such agent or underwriter within
the meaning of the Securities Act; and the obligations of such Holder and any
agents or underwriters contemplated by this Section 3.06 shall be in addition to
any liability that such Holder or its respective agent or underwriter may
otherwise have and shall extend, upon the same terms and conditions, to each
officer and director of the Company (including any person who, with his consent,
is named in any registration statement as about to become a director of the
Company) and to each person, if any, who controls the Company within the meaning
of the Securities Act.
SECTION 3.07. UNDERWRITERS. If any of the Registrable Shares are to be
sold pursuant to an underwritten offering, the investment banker or bankers and
the managing underwriter or underwriters thereof shall be selected by the
Company except in the case of a Demand Registration, in which case the managing
underwriter or underwriters shall be selected by the Holder requesting such
Registration after consultation with the Company and taking into account the
Company's reasonable requests, PROVIDED that such managing underwriter or
underwriters must be of recognized international standing.
SECTION 3.08. LOCKUP. Each Holder shall, in connection with any
registration of the Company's securities, upon the request of the Company or the
underwriters managing any underwritten offering of the Company's securities,
agree in writing not to effect any sale, disposition or distribution of any
Registrable Shares (other than that included in the registration) without the
prior written consent of the Company or such underwriters, as the case may be,
for such period of time not to exceed one hundred and eighty (180) days from the
effective date of such registration as the Company or the underwriters may
specify; PROVIDED, HOWEVER, that all executive officers and directors of the
Company shall also have agreed not to effect any sale, disposition or
distribution of any Registrable Shares under the circumstances and pursuant to
the terms set forth in this Section 3.08.
SECTION 3.09. LEGENDS. (a) Stop transfer restrictions will be given to
the Company's transfer agent(s) with respect to the Registrable Shares and there
will be placed on the certificate or instruments representing the Registrable
Shares, and on any certificate or instrument delivered in substitution or
exchange therefor, a legend stating in substance:
THE SHARES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN REGISTERED UNDER
THE UNITED STATES SECURITIES ACT OF 1933, AS
<PAGE>
12
AMENDED (THE "SECURITIES ACT"), AND MAY NOT BE SOLD, PLEDGED OR OTHERWISE
TRANSFERRED EXCEPT PURSUANT TO SUCH REGISTRATION OR IN ACCORDANCE WITH AN
EXEMPTION FROM THE REGISTRATION REQUIREMENTS OF THE SECURITIES ACT.
(b) The Company hereby agrees that it will cause stop transfer
restrictions to be released with respect to any Registrable Shares that are
transferred (i) pursuant to an effective registration statement under the
Securities Act, (ii) pursuant to Rule 144 under the Securities Act, or (iii)
pursuant to another exemption from the registration requirements of the
Securities Act; PROVIDED, HOWEVER, that in the case of any transfer pursuant to
clause (ii) or (iii) above, the request for transfer is accompanied by a written
statement signed by the Holder confirming compliance with the requirements of
the relevant exemption from registration; and PROVIDED, FURTHER, that in the
case of any transfer pursuant to clause (iii) above, other than any transfer by
the Holder to one or more of its direct or indirect subsidiaries, or among such
subsidiaries, or by any such subsidiary to the Holder, the Company shall have
received a written opinion of counsel reasonably satisfactory to the Company
that such registration is not required. The Company further agrees that it will
cause the legend described in subsection (a) of this Section 3.09 to be removed
in the event of any transfer as provided in clause (i) or (ii) above.
SECTION 3.10. PUBLIC INFORMATION. The Company covenants to make available
"adequate current public information" concerning the Company within the meaning
of Rule 144(c) under the Securities Act.
ARTICLE IV
MISCELLANEOUS
SECTION 4.01. TERM OF AGREEMENT; TERMINATION. The term of this Agreement
shall commence on the date hereof and such term and this Agreement shall
terminate on the earlier of ten years from the date of this Agreement or the
date that Mr. Lawrence J. Gould, Mr. Simon C. Thornley or Mr. Brian K. Wolske,
as the case may be, ceases to be employed by the Company; PROVIDED, HOWEVER,
that a Demand Registration shall not have been demanded or registered and not
yet become effective.
SECTION 4.02. SPECIFIC PERFORMANCE AND OTHER EQUITABLE RIGHTS. Each of
the parties hereto recognizes and acknowledges that a breach by a party or by
any assignee thereof of any covenants or other commitments contained in this
Agreement will cause the other party to sustain injury for which it would not
have an adequate remedy at law for money damages. Therefore, each of the
parties hereto agrees that in the event of any such breach, the aggrieved party
shall be entitled to the remedy of specific performance of such covenants or
commitments and preliminary and permanent injunctive and other equitable relief
in addition to any other remedy to which it may be entitled, at law or in
equity, and
<PAGE>
13
the parties hereto hereby waive any requirement for the securing or posting of
any bond in connection with the obtaining of any such injunctive or other
equitable relief.
SECTION 4.03. NOTICES. All notices, requests, demands and other
communications hereunder shall be deemed to have been duly given and made if in
writing and if served by personal delivery upon the party for whom it is
intended or delivered by registered or certified mail, return receipt requested,
or if sent by telecopier, upon receipt of oral confirmation that such
transmission has been received, to the person at the address set forth below, or
such other address as may be designated in writing hereafter, in the same
manner, by such person:
(a) If to the Company, addressed as follows:
101 Bayham Street
London NW1 0AG
England
Attention:
Telecopier: 44-171-767-6540
with a copy to:
Shearman & Sterling
199 Bishopsgate
London EC2M 3TY
Attention: Pamela M. Gibson
Telecopier: 44-171-920-9000
(b) If to the Directors, addressed as described in Schedule I hereto;
with a copy to:
Clifford chance
200 Aldersgate
London EC1A 4JJ
Attention: Michael Francies
Telecopier: 44-171-600-5555
or to such other address as the relevant party may from time to time advise by
notice in writing given pursuant to this Section 4.03. The date of receipt of
any such notice, request, consent, agreement or approval shall be deemed to be
the date of delivery thereof.
<PAGE>
14
SECTION 4.04. SURVIVAL. The several indemnities, agreements,
representations, warranties and each other provision set forth in this Agreement
or made pursuant hereto shall remain in full force and effect regardless of any
investigation (or statement as to the results thereof) made by or on behalf of
any party, any director or officer of such party, or any controlling person of
any of the foregoing, and shall survive the transfer of any Registrable Shares
by each Director, and the indemnification and contribution provisions set forth
in Section 3.06 hereof shall survive termination of this Agreement.
SECTION 4.05. SEVERABILITY. If any term, provision, covenant or
restriction of this Agreement is held by a court of competent jurisdiction to be
invalid, void or unenforceable, the remainder of the terms, provisions,
covenants and restrictions of this Agreement shall remain in full force and
effect and shall in no way be affected, impaired or invalidated.
SECTION 4.06. TRANSFER OF REGISTRATION RIGHTS. The registration rights of
each Director in this Agreement with respect to any Registrable Shares may be
transferred (a) to any person acquiring all of the Registrable Shares held by
the Holder or (b) to an Affiliate of such Holder; PROVIDED, HOWEVER, that the
Company may deny such transfer if (i) such Director or the transferring person
has made three transfers with respect to the Registrable Shares or (ii) such
transfer relates to a sale or other transfer of some or all of the Registrable
Shares to a person who is a competitor of the Company or its subsidiaries in the
industry or (iii) any conditions in the second last sentence of this Section
4.06 is not met. Each such transfer is contingent on such Director or the
transferring person satisfying the following: (i) such Director or transferring
person shall have given the Company written notice at or prior to the time of
such transfer stating the name and address of the transferee and identifying the
securities with respect to which the rights under this Agreement are being
transferred; (ii) such transferee shall have agreed in writing, in form and
substance reasonably satisfactory to the Company, to be bound by the provisions
of this Agreement; and (iii) immediately following such transfer the further
disposition of such securities by each transferee shall be restricted under the
Securities Act. Except as set forth in this Section 4.06, no transfer of
Registrable Shares shall cause such Registrable Shares to lose such status.
SECTION 4.07. SUCCESSORS AND ASSIGNS. Except as otherwise expressly
provided herein, the terms and conditions of this Agreement shall inure to the
benefit of and be binding upon the respective successors and assigns of the
parties hereto. Except as expressly provided in this Agreement, nothing in this
Agreement, express or implied, is intended to confer upon any person other than
the parties hereto or their respective successors and assigns any rights,
remedies, obligations, or liabilities under or by reason of this Agreement.
SECTION 4.08. GOVERNING LAW. This Agreement shall be governed by and
construed in accordance with the laws of the State of New York.
<PAGE>
15
Any controversy or claim arising out of or relating to this Agreement, or
the breach thereof shall be settled by mandatory final and binding arbitration
in New York City, New York, USA in accordance with the rules, then obtaining, of
the American Arbitration Association, and judgment upon the award rendered may
be entered in any court having jurisdiction thereof. Reasonable fees, costs and
expenses, including legal fees, incurred by any party in connection with such
arbitration shall be borne by such party. Nothing in this Section 4.08 shall
limit any right that any party may otherwise have to seek to obtain preliminary
injunctive relief in order to preserve the status quo pending the disposition of
any such arbitration proceeding.
SECTION 4.9. ENTIRE AGREEMENT; AMENDMENTS. This Agreement and the other
writings referred to herein or delivered pursuant hereto which form a part
hereof contain the entire understanding of the parties with respect is to its
subject matter. This Agreement supersedes all prior agreements and
understandings among the parties with respect to its subject matter. This
Agreement may be amended and the observance of any term of this Agreement may be
waived (either generally or in a particular instance and either retroactively or
prospectively) only by a written instrument duly executed by each of the
parties, which shall be binding on all of the parties.
SECTION 4.10. COUNTERPARTS. This Agreement may be executed in two or more
counterparts, each of which shall be deemed an original, but all of which
together shall constitute one and the same instrument.
<PAGE>
16
IN WITNESS WHEREOF, the parties hereto have executed this Agreement as
of the date first above written.
GETTY COMMUNICATIONS PLC
By: ______________________________________________
Name:
Title:
MARK H. GETTY
By: ______________________________________________
Name:
Title:
JONATHAN D. KLEIN
By: ______________________________________________
Name:
Title:
LAWRENCE J. GOULD
By: ______________________________________________
Name:
Title:
<PAGE>
17
Schedule I
Director Address
- -------- -------
Mark H. Getty
Jonathan D. Klein
Lawrence J. Gould
Simon C. Thornley
Brian K. Wolske
<PAGE>
REGISTRATION RIGHTS AGREEMENT AMENDMENT
REGISTRATION RIGHTS AGREEMENT AMENDMENT, dated as of January [__],
1997 (this "AMENDMENT"), among Getty Communications plc, a public limited
company organized under the laws of England and Wales ("GETTY COMMUNICATIONS"),
each of Lawrence J. Gould, Mark H. Getty and Jonathan D. Klein (together the
"RIGHTS HOLDERS" and each individually, a "RIGHTS HOLDER") and Getty Images,
Inc., a Delaware corporation ("GETTY IMAGES").
WHEREAS, Getty Communications, the Rights Holders, Simon C. Thornley
and Brian K. Wolske entered into the Registration Rights Agreement dated as of
July 3, 1996 (the "REGISTRATION RIGHTS AGREEMENT") pursuant to which the Rights
Holders were granted certain registration rights with respect to Class A
ordinary shares, nominal value one pence per share ("GETTY CLASS A ORDINARY
SHARES"), of Getty Communications held by the Rights Holders or which may be
issued to the Rights Holders upon the exercised of any options, a copy of which
is attached hereto as Exhibit A;
WHEREAS, pursuant to a merger agreement dated as of September 15, 1997
(the "MERGER AGREEMENT"), by and among Getty Images, Getty Communications,
PhotoDisc, Inc., a Washington corporation, and Print Merger, Inc., a Washington
corporation and a wholly owned subsidiary of Getty Images, Getty Images and
Getty Communications will enter into a scheme of arrangement (the "SCHEME OF
ARRANGEMENT") in accordance with the Companies Act of 1985 of Great Britain
(unless otherwise defined herein, capitalized terms used herein shall have the
meanings ascribed thereto in the Merger Agreement);
WHEREAS, pursuant to the Scheme of Arrangement, each issued Class B
ordinary share, nominal value one pence per share ("GETTY CLASS B ORDINARY
SHARES", and, together with the Getty Class A Ordinary Shares, the "GETTY
ORDINARY SHARES"), of Getty Communications will be converted into one Getty
Class A Ordinary Share, each Getty Ordinary Share will be transferred to Getty
Images or its nominees and the holders of Getty Ordinary Shares will be issued
one share of Getty Images Common Stock for every two Getty Ordinary Shares held
of record by such holders, and Getty Communications will become a wholly owned
subsidiary of Getty Images;
WHEREAS, upon the consummation of the Scheme of Arrangement, the
Rights Holders will hold only Getty Images Shares;
WHEREAS, the rights of Simon C. Thornley and Brian K. Wolske under the
Registration Rights Agreement have terminated in accordance with the terms of
the Registration Rights Agreement; and
WHEREAS, the parties each desire to amend the Registration Rights
Agreement pursuant to Section 4.9 thereof and to make certain covenants and
agreements
<PAGE>
2
concerning the registration from time to time under the Securities Act of 1933,
as amended (the "SECURITIES ACT"), of Getty Images Shares held by the Rights
Holders.
NOW, THEREFORE, in consideration of the mutual promises,
representations, warranties and conditions contained herein, the parties agree
as follows:
SECTION 1.01. AMENDMENT. Each of the parties agrees that, upon the
consummation of the Scheme of Arrangement, the Registration Rights Agreement
shall be amended such that (i) the "Company" as used therein shall refer to
Getty Images rather Getty Communications and (ii) "Registrable Shares" as used
therein shall include Getty Images Shares issued in the Scheme of Arrangement in
respect of Registrable Shares as defined in the Registration Rights Agreement.
The terms and conditions of the Registration Rights Agreement shall inure to the
benefit of Getty Images as the successor to Getty Communications and any rights
or obligations of Getty Communications shall become the sole obligation of Getty
Images.
IN WITNESS WHEREOF, each of Getty Communications, the Rights Holders
and Getty Images has duly executed, or has caused this Amendment to be duly
executed by its duly authorized representative, as of the date first written
above.
GETTY
COMMUNICATIONS PLC
By:
------------------------------
Name: Mark Getty
Title:
---------------------------------
Lawrence J. Gould
---------------------------------
Mark H. Getty
<PAGE>
3
---------------------------------
Jonathan D. Klein
GETTY IMAGES, INC.
By:
------------------------------
Name: Mark Torrance
Title: Co-Chairman
<PAGE>
REGISTRATION RIGHTS AGREEMENT
REGISTRATION RIGHTS AGREEMENT, dated as of July 3, 1996 (this "Agreement"),
between Getty Communications plc, a public limited company organized under the
laws of England and Wales (the "Company"), and each of the trustees of the
October 1993 Trust and Crediton Limited (together the "Trusts" and each
individually, a "Trust").
WHEREAS, the Company has determined that it is in the best interests of the
Company to offer Class A Ordinary Shares of the Company (the "Class A Shares")
in the form of American Depositary Shares in the United States (the "Offering")
pursuant to the filing of a Form F-1 Registration Statement under the United
States Securities Act of 1933, as amended (the "Securities Act"); and
WHEREAS, after the consummation of the Offering, the Trusts will own
18.8 percent of the total voting power of the Company in the form of
2,490,408 Class B Ordinary Shares of the Company (the "Class B Shares" and,
together with the Class A Shares, the "Ordinary Shares") which may, subject to
certain conditions, be converted into Class A Shares (upon conversion, the
"Conversion Shares"); and
WHEREAS, the parties each desire to make certain covenants and agreements
concerning the registration from time to time of the Registrable Shares (as
defined below) under the Securities Act.
NOW, THEREFORE, in consideration of the mutual promises, representations,
warranties and conditions contained herein, the parties hereto agree as follows:
ARTICLE I
DEFINITIONS
SECTION 1.01. As used in this Agreement, the following terms shall have
the following respective meanings:
"COMMISSION" shall mean the United States Securities and Exchange
Commission, or any other United States federal agency at the time
administering the Securities Act or the Exchange Act, as applicable,
whichever is the relevant statute.
"EXCHANGE ACT" shall mean the United States Securities Exchange
Act of 1934, or any similar federal statute, and the rules and regulations
of the Commission thereunder, all as the same shall be amended from time to
time.
"HOLDER" shall mean each Trust or any transferee or assignee
thereof to whom the rights under this Agreement are assigned in accordance
with the provisions of Section 4.06 hereof.
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2
"PERSON" shall mean a corporation, association, partnership,
organization, group (as such term is used in Rule 13d-5 under the Exchange
Act), business, individual, government or political subdivision thereof,
governmental agency or other entity.
"REGISTRABLE SHARES" shall mean (i) the Conversion Shares,
(ii) any Ordinary Shares issued as (or issuable upon the conversion or
exercise of any warrant, right, option or other convertible security which
is issued as) a dividend or other distribution with respect to, or in
exchange for, or in replacement of, the Conversion Shares, (iii) any
Ordinary Shares issued by way of a stock split or which otherwise reduces
the percentage holding at the date of the offering of the Conversion Shares
referred to in clauses (i) or (ii) above and (iv) any Ordinary Shares of
the Company acquired pursuant to the Shareholders' Agreement dated as of
July 8, 1996, among Getty Investments LLC and the Trusts (the
"Shareholders' Agreement"), only to the extent that such acquisition
increases the holding of the Class B Shares of a Trust beyond its holding
at the Offering Date. For purposes of this Agreement, any Registrable
Shares shall cease to be Registrable Shares when (x) a registration
statement covering such Registrable Shares has been declared effective and
such Registrable Shares have been disposed of pursuant to such effective
registration statement and (y) such Registrable Shares are sold freely in
the public market by a person in a transaction in which the rights under
the provisions of this Agreement are not assigned.
ARTICLE II
REPRESENTATIONS AND WARRANTIES
SECTION 2.01. REPRESENTATIONS AND WARRANTIES OF THE TRUSTS. Each Trust,
severally, hereby represents and warrants to the Company that it has all
requisite power and authority, and has received all requisite approvals to
complete the transactions contemplated hereby; this Agreement has been duly
authorized, executed and delivered by each Trust and constitutes a valid and
binding agreement enforceable against it in accordance with its terms.
SECTION 2.02. REPRESENTATIONS AND WARRANTIES OF THE COMPANY. The Company
represents and warrants to each Trust that it has been duly organized and is an
existing corporation in good standing under the laws of England and Wales and
that (i) it has all requisite corporate power and authority, and has received
all requisite approvals (including any necessary approval of its board of
directors) to complete the transactions contemplated hereby and (ii) this
Agreement has been duly authorized, executed and delivered by it and constitutes
a valid and binding agreement enforceable by each Trust against it in accordance
with its terms.
ARTICLE III
<PAGE>
3
AGREEMENTS IN RESPECT OF THE REGISTRABLE SHARES
SECTION 3.01. DEMAND REGISTRATIONS. (a) Within 90 days following the date
that Mr. Mark H. Getty, in the case of the trustees of the October 1993 Trust
and its transferees or assignees, and within 90 days following the date that Mr.
Jonathan D. Klein, in the case of Crediton Limited and its transferees or
assignees, ceases to be employed by the Company, each such Holder shall have the
right (the "Demand Right") on one occasion to require the Company to file a
registration statement under the Securities Act in respect of all the
Registrable Shares held by such Holder; PROVIDED, HOWEVER, that if such Holder
is exercising such Demand Right together with any other Holders, then it may be
exercised if the Registrable Shares and the other shares demanded by the other
Holders shall exceed five percent of the outstanding Ordinary Shares of the
Company. As promptly as practicable, but in no event later than 30 days after
the Company receives a written request from such Holder demanding that the
Company so register the number of Registrable Shares specified in such request,
the Company shall file with the Commission and thereafter use its best efforts
to cause to be declared effective promptly a registration statement (a "Demand
Registration") providing for the registration of all Registrable Shares as such
Holder shall have demanded be registered.
(b) Anything in this Agreement to the contrary notwithstanding, the
Company shall be entitled to postpone and delay, for a reasonable period of
time, not to exceed 45 days (the "Blackout Period"), the filing of any Demand
Registration if (i) the Company is conducting or about to conduct an
underwritten public offering of securities in which the Holder is entitled to
join pursuant to Section 3.02 hereof, (ii) the Company is subject to an existing
contractual obligation not to engage in a public offering, or (iii) the Company
shall determine that any such filing or the offering of any Registrable Shares
would (x) in the good faith judgment of the Board of Directors of the Company,
impede, delay or otherwise interfere with any pending or contemplated financing,
acquisition, corporate reorganization or other similar transaction involving the
Company, (y) based upon advice from the Company's investment banker or financial
advisor, adversely affect any pending or contemplated offering or sale of any
class of securities by the Company, or (z) require disclosure of material
nonpublic information which, if disclosed at such time, would be materially
harmful to the interests of the Company and its shareholders; PROVIDED, HOWEVER,
that the Blackout Period shall terminate upon the completion or abandonment of
the relevant securities offering or sale, the termination or expiration of the
existing contractual obligation to its underwriters not to engage in a public
offering, the completion or abandonment of the relevant financing, acquisition,
corporate reorganization or other similar transaction, such time as such Demand
Registration shall no longer affect the relevant pending or contemplated
offering or sale of securities by the Company, or the public disclosure by the
Company or public admission by the Company of such material nonpublic
information or such time as such material nonpublic information shall be
publicly disclosed without breach of the last sentence of this subsection (b),
as the case may be. After the expiration of any Blackout Period and without any
further request from a Holder, the Company shall effect the filing of the
relevant Demand Registration and shall use its best efforts to cause any such
Demand Registration to be declared effective as promptly as
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4
practicable unless such Holder shall have, prior to the effective date of such
Demand Registration, withdrawn in writing its initial request, in which case
such withdrawn request shall not constitute a Demand Registration for purposes
of determining the number of Demand Registrations to which such Holder is
entitled to hereunder.
(c) Except with respect to any request by a Holder for a Demand
Registration which is subsequently withdrawn prior to such Demand Registration
becoming effective due to (i) a material adverse change affecting the Company or
capital markets generally, or (ii) a notification by the Company of an intention
to file a registration statement with respect to the Class A Shares, such Holder
shall share equally with the Company all expenses relating to the preparation of
such withdrawn Demand Registration.
SECTION 3.02. INCIDENTAL REGISTRATION. (a) If, at any time following the
date of the Offering and up to and including 30 days after, in the case of the
October 1993 Trust, Mr. Mark H. Getty ceases to be employed by the Company or,
in the case of Crediton Limited, Mr. Jonathan D. Klein ceases to be employed by
the Company, the Company proposes to file a registration statement under the
Securities Act with respect to an offering of its Class A Shares (i) for its own
account (other than a registration statement on Form S-4 or S-8 (or any
substitute form that may be adopted by the Commission)) or (ii) for the account
of any holders of its Class A Shares (including any pursuant to a demand
registration), the Company shall give written notice of such proposed filing to
each Holder as soon as practicable (but in any event not less than 30 days
before the anticipated filing date), and such notice shall offer each Holder the
opportunity to register such number of Registrable Shares as the Holder shall
request. Upon the written direction of any Holder, given within 20 days
following the receipt by such Holder of any such written notice (which direction
shall specify the number of Registrable Shares intended to be disposed of by
such Holder), the Company shall include in such registration statement (an
"Incidental Registration" and, collectively with a Demand Registration, a
"Registration") such number of Registrable Shares as shall be set forth in such
notice. Notwithstanding anything contained herein, if the lead underwriter of
an offering involving an Incidental Registration delivers a written opinion to
the Company that the inclusion of such Registrable Shares would materially and
adversely affect the price of the Class A Shares to be offered or (ii) result in
a greater amount of Class A Shares being offered than the market could
reasonably absorb, then the number of Registrable Shares to be registered by
each party requesting Incidental Registration rights shall be reduced in
proportion to the number of securities originally requested to be registered by
each of them. Nothing contained herein shall require the Company to reduce the
number of Class A Shares proposed to be issued by the Company.
(b) No Incidental Registration effected under this Section 3.02 shall be
deemed to have been effected pursuant to Section 3.01 hereof or shall release
the Company of its obligations to effect any Demand Registration upon request as
provided under Section 3.01 hereof.
<PAGE>
5
SECTION 3.03. REGISTRATION PROCEDURES. (a) In connection with each
Registration, and in accordance with the intended method or methods of
distribution of the Class A Shares as described in such Registration, the
Company shall, as soon as reasonably practicable (and, in any event, subject to
the terms of this Agreement, including, without limitation, Section 3.01(a)
hereof, at or before the time required by applicable laws and regulations):
(a) prepare and file with the Commission a registration statement
with respect to such Registrable Shares and use its best efforts to cause
such registration statement to become and remain effective for the period
of the distribution contemplated thereby determined as provided hereafter;
(b) prepare and file with the Commission such amendments and
supplements to such registration statement and the prospectus used in
connection therewith as may be necessary to comply with the provisions of
the Securities Act with respect to the disposition of all Registrable
Shares covered by such registration statement;
(c) furnish to the Holder such numbers of copies of the registration
statement and the prospectus included therein (including each preliminary
prospectus and any amendments or supplements thereto), in conformity with
the requirements of the Securities Act and such other documents and
information as it may reasonably request;
(d) use its best efforts to register or qualify the Registrable
Shares covered by such registration statement under such other securities
or blue sky laws of such jurisdiction within the United States and Puerto
Rico as shall be reasonably appropriate for the distribution of the
Registrable Shares covered by the registration statement; PROVIDED,
HOWEVER, that the Company shall not be required in connection therewith or
as a condition thereto to qualify to do business in or to file a general
consent to service of process in any jurisdiction wherein it would not but
for the requirements of this paragraph (d) be obligated to do so; and
PROVIDED, FURTHER, that the Company shall not be required to qualify such
Registrable Shares in any jurisdiction in which the securities regulatory
authority requires that the Holder submit any of its Registrable Shares to
the terms, provisions and restrictions of any escrow, lockup or similar
agreement(s) for consent to sell Registrable Shares in such jurisdiction
unless such Holder agrees to do so;
(e) promptly notify each Holder, at any time when a prospectus
relating to the Registrable Shares is required to be delivered under the
Securities Act, of the happening of any event as a result of which the
prospectus included in such registration statement, as then in effect,
includes an untrue statement of a material fact or omits to state any
material fact required to be stated therein or necessary to make the
statements therein not misleading in light of the circumstances under which
they were made, and at the request of any such Holder promptly prepare and
<PAGE>
6
furnish to such Holder a reasonable number of copies of a supplement to or
an amendment of such prospectus as may be necessary so that, as thereafter
delivered to the purchasers of such securities, such prospectus shall not
include an untrue statement of a material fact or omit to state a material
fact required to be stated therein or necessary to make the statements
therein not misleading in light of the circumstances under which they were
made;
(f) furnish, at the request of any Holder requesting registration of
Registrable Shares pursuant to Sections 3.01 or 3.02 hereof, if the method
of distribution is by means of an underwriting, on the date that the
Registrable Shares are delivered to the underwriters for sale pursuant to
such registration, or if such Registrable Shares are not being sold through
underwriters, on the date that the registration statement with respect to
such Registrable Shares becomes effective, (1) a signed opinion, dated such
date, of the independent legal counsel representing the Company for the
purpose of such registration, addressed to the underwriters, if any, and if
such Registrable Shares are not being sold through underwriters, then to
the Holders making such request, as to such matters as such underwriters or
the Holders holding a majority of the Registrable Shares included in such
registration, as the case may be, may reasonably request and as would be
customary in such a transaction; and (2) letters dated such date and the
date the offering is priced from the independent certified public
accountants of the Company, addressed to the underwriters, if any, and if
such Registrable Shares are not being sold through underwriters, then to
the Holders making such request and, if such accountants refuse to deliver
such letters to such Holders, then to the Company (i) stating that they are
independent certified public accountants within the meaning of the
Securities Act and that, in the opinion of such accountants, the financial
statements and other financial data of the Company included in the
registration statement or the prospectus, or any amendment or supplement
thereto, comply as to form in all material respects with the applicable
accounting requirements of the Securities Act and (ii) covering such other
financial matters (including information as to the period ending not more
than five (5) business days prior to the date of such letters) with respect
to the registration in respect of which such letter is being given as such
underwriters or the Holders holding a majority of the Registrable Shares
included in such registration, as the case may be, may reasonably request
and as would be customary in such a transaction;
(g) enter into customary agreements (including if the method of
distribution is by means of an underwriting, an underwriting agreement in
customary form) and take such other actions as are reasonably required in
order to expedite or facilitate the disposition of the Registrable Shares
to be so included in the registration statement;
(h) otherwise use its best efforts to comply with all applicable
rules and regulations of the Commission, and make available to its security
holders, as soon as reasonably practicable, but not later than eighteen
(18) months after the effective
<PAGE>
7
date of the registration statement, an earnings statement covering the
period of at least twelve (12) months beginning with the first full month
after the effective date of such registration statement, which earnings
statements shall satisfy the provisions of Section 11(a) of the Securities
Act; and
(i) use its best efforts to list the Class A Shares covered by such
registration statement with any securities exchange on which the Class A
Shares are then listed.
(b) Each Holder requesting registration shall furnish to the Company in
writing such information regarding such Holder and its intended method of
distribution of the Registrable Shares as the Company may from time to time
reasonably request in writing, but only to the extent that such information is
required in order for the Company to comply with its obligations under all
applicable securities and other laws and to ensure that the prospectus relating
to such Registrable Shares conforms to the applicable requirements of the
Securities Act and the rules and regulations thereunder. Such Holder shall
notify the Company as promptly as practicable of any inaccuracy or change in
information previously furnished by such Holder to the Company or of the
occurrence of any event, in either case as a result of which any prospectus
relating to the Registrable Shares contains or would contain an untrue statement
of a material fact regarding such Holder or its intended method of distribution
of such Registrable Shares or omits to state any material fact regarding such
Holder or its intended method of distribution of such Registrable Shares
required to be stated therein or necessary to make the statements therein, in
the light of the circumstances under which they were made, not misleading, and
promptly furnish to the Company any additional information required to correct
and update any previously furnished information, or required so that such
prospectus shall not contain, with respect to such Holder or the intended method
of distribution of the Registrable Shares, an untrue statement of a material
fact or omit to state a material fact required to be stated therein or necessary
to make the statements therein, in the light of the circumstances under which
they were made, not misleading.
SECTION 3.05. REGISTRATION EXPENSES. All expenses, excluding
underwriters' discounts and commissions and any stamp or transfer tax or duty,
but including without limitation all registration, filing and qualification
fees, word processing, duplicating, printers' and accounting fees (including the
expenses of any special audits or "cold comfort" letters required by or incident
to such performance and compliance), fees of the National Association of
Securities Dealers, Inc. or listing fees, messenger and delivery expenses, all
fees and expenses of complying with state securities or blue sky laws, fees and
disbursements of one counsel for the Holders and fees and disbursements of
counsel for the Company incurred in connection with each registration shall be
paid by the Company. Each Holder shall bear and pay the underwriting
commissions and discounts and any stamp or transfer tax or duty and the fees and
disbursements of counsel for the Holders other than the one counsel referred to
above incurred in connection with such registration applicable to securities
offered for its account in connection with any registrations, filings and
qualifications made pursuant to this Agreement.
<PAGE>
8
SECTION 3.06. INDEMNIFICATION; CONTRIBUTION. (a) INDEMNIFICATION BY THE
COMPANY. The Company shall, and it hereby agrees to, indemnify and hold
harmless each Holder, such Holder's directors and officers, and each person who
participates as a placement or sales agent or as an underwriter in any offering
or sale of the Registered Shares, against any losses, claims, damages or
liabilities to which such Holder or such agent or underwriter may become
subject, insofar as such losses, claims, damages or liabilities (or actions or
proceedings in respect thereof) arise out of or are based upon an untrue
statement or alleged untrue statement of a material fact contained in any
Registration, or any preliminary or final prospectus contained therein, or any
amendment or supplement thereto, or any document incorporated by reference
therein, or arise out of or are based upon any omission or alleged omission to
state therein a material fact required to be stated therein or necessary to make
the statements therein not misleading, and the Company shall, and it hereby
agrees to, reimburse each such Holder or any such agent or underwriter for any
legal or other out-of-pocket expenses reasonably incurred by them (but not in
excess of expenses incurred in respect of one counsel for all of them unless
there is an actual conflict of interest between any indemnified parties, which
indemnified parties may be represented by separate counsel) in connection with
investigating or defending any such action, proceeding or claim; PROVIDED,
HOWEVER, that the indemnity agreement contained in this Section 3.06(a) shall
not apply to amounts paid in settlement of any such loss, claim, damage,
liability or action if such settlement is effected without the consent of the
Company which consent shall not be unreasonably withheld; PROVIDED, FURTHER,
that the Company shall not be liable to any such person in any such case to the
extent that any such loss, claim, damage, liability or expense arises out of or
is based upon an untrue statement or alleged untrue statement or omission or
alleged omission made in such Registration, or preliminary or final prospectus,
or amendment or supplement thereto, in reliance upon and in conformity with
written information furnished to the Company by such Holder or any agent,
underwriter or representative of such Holder expressly for use therein, or by
such Holder's failure to furnish the Company, upon request, with the information
with respect to such Holder, such Holder's directors and officers, or any agent,
underwriter or representative of such Holder, or such Holder's intended method
of distribution, that is the subject of the untrue statement or omission or if
the Company shall sustain the burden of proving that such Holder, such Holder's
directors and officers, or such agent or underwriter sold securities to the
person alleging such loss, claim, damage or liability without sending or giving,
at or prior to the written confirmation of such sale, a copy of the applicable
prospectus (excluding any documents incorporated by reference therein) or of the
applicable prospectus, as then amended or supplemented (excluding any documents
incorporated by reference therein) if the Company had previously furnished
copies thereof to the such Holder or such agent or underwriter, and such
prospectus corrected such untrue statement or alleged untrue statement or
omission or alleged omission made in such Registration.
(b) INDEMNIFICATION BY THE HOLDER AND ANY AGENT OR UNDERWRITERS. Each
Holder requesting or joining in a Registration severally and not jointly shall
indemnify and hold harmless the Company, each of its directors and officers,
each person, if any, who
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9
controls the Company within the meaning of the Securities Act, and each agent
and any underwriter for the Company (within the meaning of the Securities Act)
against any losses, claims, damages or liabilities, joint or several, to which
the Company or any such director, officer, controlling person, agent or
underwriter may become subject, under the Securities Act or otherwise, insofar
as such losses, claims, damages or liabilities (or proceedings in respect
thereof) arise out of or are based upon any untrue statement or alleged untrue
statement of any material fact contained in such registration statement on the
effective date thereof (including any prospectus filed under Rule 424 under the
Securities Act or any amendments or supplements thereto) or arise out of or are
based upon the omission or alleged omission to state therein a material fact
required to be stated therein or necessary to make the statements therein not
misleading, in each case to the extent, but only to the extent, that such untrue
statement or alleged untrue statement or omission or alleged omission was made
in such registration statement, preliminary or final prospectus, or amendments
or supplements thereto, in reliance upon and in conformity with written
information furnished by or on behalf of such Holder expressly for use in
connection with such Registration; and each such Holder shall reimburse any
legal or other expenses reasonably incurred by the Company or any such director,
officer, controlling person, agent or underwriter (but not in excess of expenses
incurred in respect of one counsel for all of them unless there is an actual
conflict of interest between any indemnified parties, which indemnified parties
may be represented by separate counsel) in connection with investigating or
defending any such loss, claim, damage, liability or action; PROVIDED, HOWEVER,
that the indemnity agreement contained in this Section 3.06(b) shall not apply
to amounts paid in settlement of any such loss, claim, damage, liability or
action if such settlement is effected without the consent of such Holder (which
consent shall not be unreasonably withheld).
(c) NOTICE OF CLAIMS, ETC. Promptly after receipt by an indemnified party
under subsection (a) or (b) above of written notice of the commencement of any
action or proceeding for which indemnification under subsection (a) or (b) may
be requested, such indemnified party shall, without regard to whether a claim in
respect thereof is to be made against an indemnifying party pursuant to the
indemnification provisions of, or as contemplated by, this Section 3.06, notify
such indemnifying party in writing of the commencement of such action or
proceeding; but the omission so to notify the indemnifying party shall not
relieve it from any liability which it may have to any indemnified party in
respect of such action or proceeding on account of the indemnification
provisions of or contemplated by Section 3.06(a) or 3.06(b) hereof unless the
indemnifying party was materially prejudiced by such failure of the indemnified
party to give such notice, and in no event shall such omission relieve the
indemnifying party from any other liability it may have to such indemnified
party. In case any such action or proceeding shall be brought against any
indemnified party and it shall notify an indemnifying party of the commencement
thereof, such indemnifying party shall be entitled to participate therein and,
to the extent that it shall determine, jointly with any other indemnifying party
similarly notified, to assume the defense thereof, with counsel reasonably
satisfactory to such indemnified party, and, after notice from the indemnifying
party to such indemnified party of its election so to assume the defense
thereof, such indemnifying party shall not be liable
<PAGE>
10
to such indemnified party for any legal or any other expenses subsequently
incurred by such indemnified party, in connection with the defense thereof other
than reasonable costs of investigation (unless such indemnified party reasonably
objects to such assumption on the grounds that there may be defenses available
to it which are different from or in addition to the defenses available to such
indemnifying party, in which event the indemnified party shall have the right to
control its defense and shall be reimbursed by the indemnifying party for the
expenses incurred in connection with retaining separate counsel). If the
indemnifying party is not entitled to, or elects not to, assume the defense of a
claim, it will not be obligated to pay the fees and expenses of more than one
counsel (in addition to local counsel) for each indemnified party with respect
to such claim. The indemnifying party will not be subject to any liability for
any settlement made without its consent, which consent shall not be unreasonably
withheld or delayed. No indemnifying party will consent to entry of any
judgment or enter into any settlement agreement which does not include as an
unconditional term thereof the giving by the claimant or plaintiff to such
indemnified party of a release from all liability in respect of such claim or
litigation.
(d) CONTRIBUTION. Each Holder requesting or joining in a Registration and
the Company agree that if, for any reason, the indemnification provisions
contemplated by Section 3.06(a) or Section 3.06(b) hereof are unavailable to or
are insufficient to hold harmless an indemnified party in respect of any losses,
claims, damages or liabilities (or actions or proceedings in respect thereof)
referred to therein, then each indemnifying party shall contribute to the amount
paid or payable by such indemnified party as a result of such losses, claims,
damages or liabilities (or actions or proceedings in respect thereof) in such
proportion as is appropriate to reflect the relative fault of, and benefits
derived by, the indemnifying party and the indemnified party, as well as any
other relevant equitable considerations. The relative fault of such
indemnifying party and indemnified party shall be determined by reference to,
among other things, whether the untrue or alleged untrue statement of a material
fact or omission or alleged omission to state a material fact relates to
information supplied by such indemnifying party or by such indemnified party,
and the parties' relative intent, knowledge, access to information and
opportunity to correct or prevent such statement or omission. The parties
hereto agree that it would not be just and equitable if contribution pursuant to
this Section 3.06(d) were determined (i) by pro rata allocation (even if the
Holder or any agents for, or underwriters of, the Registrable Shares, or all of
them, were treated as one entity for such purpose); or (ii) by any other method
of allocation which does not take account of the equitable considerations
referred to in this Section 3.06(d). The amount paid or payable by an
indemnified party as a result of the losses, claims, damages or liabilities (or
actions or proceedings in respect thereof) referred to above shall be deemed to
include (subject to the limitations set forth in Section 3.06(c) hereof) any
legal or other fees or expenses reasonably incurred by such indemnified party in
connection with investigating or defending any such action, proceeding or claim.
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.
<PAGE>
11
(e) BENEFICIARIES OF INDEMNIFICATION. The obligations of the Company
under this Section 3.06 shall be in addition to any liability that it may
otherwise have and shall extend, upon the same terms and conditions, to each
officer, director and partner of each Holder requesting or joining in a
Registration and each agent and underwriter of the Registrable Shares and each
person, if any, who controls such Holder or any such agent or underwriter within
the meaning of the Securities Act; and the obligations of such Holder and any
agents or underwriters contemplated by this Section 3.06 shall be in addition to
any liability that such Holder or its respective agent or underwriter may
otherwise have and shall extend, upon the same terms and conditions, to each
officer and director of the Company (including any person who, with his consent,
is named in any registration statement as about to become a director of the
Company) and to each person, if any, who controls the Company within the meaning
of the Securities Act.
SECTION 3.07. UNDERWRITERS. If any of the Registrable Shares are to be
sold pursuant to an underwritten offering, the investment banker or bankers and
the managing underwriter or underwriters thereof shall be selected by the
Company except in the case of a Demand Registration, in which case the managing
underwriter or underwriters shall be selected by the Holder requesting such
Registration after consultation with the Company and taking into account the
Company's reasonable requests, PROVIDED that such managing underwriter or
underwriters must be of recognized international standing.
SECTION 3.08. LOCKUP. Each Holder shall, in connection with any
registration of the Company's securities, upon the request of the Company or the
underwriters managing any underwritten offering of the Company's securities,
agree in writing not to effect any sale, disposition or distribution of any
Registrable Shares (other than that included in the registration) without the
prior written consent of the Company or such underwriters, as the case may be,
for such period of time not to exceed one hundred and eighty (180) days from the
effective date of such registration as the Company or the underwriters may
specify; PROVIDED, HOWEVER, that all executive officers and directors of the
Company shall also have agreed not to effect any sale, disposition or
distribution of any Registrable Shares under the circumstances and pursuant to
the terms set forth in this Section 3.08.
SECTION 3.09. LEGENDS. (a) Stop transfer restrictions will be given to
the Company's transfer agent(s) with respect to the Registrable Shares and there
will be placed on the certificate or instruments representing the Registrable
Shares, and on any certificate or instrument delivered in substitution or
exchange therefor, a legend stating in substance:
THE SHARES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN REGISTERED UNDER
THE UNITED STATES SECURITIES ACT OF 1933, AS AMENDED (THE "SECURITIES
ACT"), AND MAY NOT BE SOLD, PLEDGED OR OTHERWISE TRANSFERRED EXCEPT
PURSUANT TO SUCH REGISTRATION OR IN ACCORDANCE WITH AN EXEMPTION FROM THE
REGISTRATION REQUIREMENTS OF THE SECURITIES ACT.
<PAGE>
12
(b) The Company hereby agrees that it will cause stop transfer
restrictions to be released with respect to any Registrable Shares that are
transferred (i) pursuant to an effective registration statement under the
Securities Act, (ii) pursuant to Rule 144 under the Securities Act, or
(iii) pursuant to another exemption from the registration requirements of the
Securities Act; PROVIDED, HOWEVER, that in the case of any transfer pursuant to
clause (ii) or (iii) above, the request for transfer is accompanied by a written
statement signed by the Holder confirming compliance with the requirements of
the relevant exemption from registration; and PROVIDED, FURTHER, that in the
case of any transfer pursuant to clause (iii) above, other than any transfer by
the Holder to one or more of its direct or indirect subsidiaries, or among such
subsidiaries, or by any such subsidiary to the Holder, the Company shall have
received a written opinion of counsel reasonably satisfactory to the Company
that such registration is not required. The Company further agrees that it will
cause the legend described in subsection (a) of this Section 3.09 to be removed
in the event of any transfer as provided in clause (i) or (ii) above.
SECTION 3.10. PUBLIC INFORMATION. The Company covenants to make available
"adequate current public information" concerning the Company within the meaning
of Rule 144(c) under the Securities Act.
ARTICLE IV
MISCELLANEOUS
SECTION 4.01. TERM OF AGREEMENT; TERMINATION. The term of this Agreement
shall commence on the date hereof and such term and this Agreement shall
terminate on the earlier of ten years from the date of this Agreement or, in the
case of The October 1993 Trust, 31 days after Mr. Mark H. Getty ceases to be
employed by the Company or, in the case of Crediton Limited, 31 days after Mr.
Jonathan D. Klein ceases to be employed by the Company; PROVIDED, HOWEVER, that
a Demand Registration shall not have been demanded or registered and not yet
become effective.
SECTION 4.02. SPECIFIC PERFORMANCE AND OTHER EQUITABLE RIGHTS. Each of
the parties hereto recognizes and acknowledges that a breach by a party or by
any assignee thereof of any covenants or other commitments contained in this
Agreement will cause the other party to sustain injury for which it would not
have an adequate remedy at law for money damages. Therefore, each of the
parties hereto agrees that in the event of any such breach, the aggrieved party
shall be entitled to the remedy of specific performance of such covenants or
commitments and preliminary and permanent injunctive and other equitable relief
in addition to any other remedy to which it may be entitled, at law or in
equity, and the parties hereto hereby waive any requirement for the securing or
posting of any bond in connection with the obtaining of any such injunctive or
other equitable relief.
SECTION 4.03. NOTICES. All notices, requests, demands and other
communications hereunder shall be deemed to have been duly given and made if in
writing
<PAGE>
13
and if served by personal delivery upon the party for whom it is intended or
delivered by registered or certified mail, return receipt requested, or if sent
by telecopier, upon receipt of oral confirmation that such transmission has been
received, to the person at the address set forth below, or such other address as
may be designated in writing hereafter, in the same manner, by such person:
(a) If the Company, addressed as follows:
101 Bayham Street
London NW1 0AG
England
Attention:
Telecopier: 44-171-767-6540
with copies to:
Shearman & Sterling
199 Bishopsgate
London EC2M 3TY
Attention: Pamela M. Gibson
Telecopier: 44-171-920-9000
Clifford Chance
200 Aldersgate Street
London EC1A 4JJ
Attention: Michael Francies
Telecopier: 44-171-600-5555
(b) If to the trustees of the October 1993 Trust, addressed as follows:
The trustees of the October 1993 Trust
c/o Coopers & Lybrand
La Motte Chambers
St. Helier
Jersey
JE1 1BJ
Attention:
Telecopier:
<PAGE>
14
(c) If to Crediton Limited, addressed as follows:
Crediton Limited
12 Finch Road
Douglas
Isle of Man
IM1 2SA
Attention:
Telecopier:
or to such other address as the relevant party may from time to time advise by
notice in writing given pursuant to this Section 4.03. The date of receipt of
any such notice, request, consent, agreement or approval shall be deemed to be
the date of delivery thereof.
SECTION 4.04. SURVIVAL. The several indemnities, agreements,
representations, warranties and each other provision set forth in this Agreement
or made pursuant hereto shall remain in full force and effect regardless of any
investigation (or statement as to the results thereof) made by or on behalf of
any party, any director or officer of such party, or any controlling person of
any of the foregoing, and shall survive the transfer of any Registrable Shares
by each Trust, and the indemnification and contribution provisions set forth in
Section 3.06 hereof shall survive termination of this Agreement.
SECTION 4.05. SEVERABILITY. If any term, provision, covenant or
restriction of this Agreement is held by a court of competent jurisdiction to be
invalid, void or unenforceable, the remainder of the terms, provisions,
covenants and restrictions of this Agreement shall remain in full force and
effect and shall in no way be affected, impaired or invalidated.
SECTION 4.06. TRANSFER OF REGISTRATION RIGHTS. The registration rights of
each Trust in this Agreement with respect to any Registrable Shares may be
transferred (a) to any person acquiring all of the Registrable Shares held by
the Holder or (b) to a "Permitted Holder" as defined in the Articles of
Association of the Company or the Shareholders' Agreement; PROVIDED, HOWEVER,
that the Company may deny such transfer if (i) such Trust or the transferring
person has made three transfers with respect to the Registrable Shares or (ii)
such transfer relates to a sale or other transfer of some or all of the
Registrable Shares to a person who is a competitor of the Company or its
subsidiaries in the industry or (iii) any conditions in the second last sentence
of this Section 4.06 is not met. Each such transfer is contingent on such Trust
or the transferring person satisfying the following: (i) each Trust or
transferring person shall have given the Company written notice at or prior to
the time of such transfer stating the name and address of the transferee and
identifying the securities with respect to which the rights under this Agreement
are being transferred; (ii) such transferee shall have agreed in writing, in
form and substance reasonably satisfactory to the Company, to be bound by the
provisions of this Agreement; and (iii) immediately following such transfer the
further disposition of such securities by each transferee shall be
<PAGE>
15
restricted under the Securities Act. Except as set forth in this Section 4.06,
no transfer of Registrable Shares shall cause such Registrable Shares to lose
such status.
SECTION 4.07. SUCCESSORS AND ASSIGNS. Except as otherwise expressly
provided herein, the terms and conditions of this Agreement shall inure to the
benefit of and be binding upon the respective successors and assigns of the
parties hereto. Except as expressly provided in this Agreement, nothing in this
Agreement, express or implied, is intended to confer upon any person other than
the parties hereto or their respective successors and assigns any rights,
remedies, obligations, or liabilities under or by reason of this Agreement.
SECTION 4.08. GOVERNING LAW. This Agreement shall be governed by and
construed in accordance with the laws of the State of New York.
Any controversy or claim arising out of or relating to this Agreement, or
the breach thereof shall be settled by mandatory final and binding arbitration
in New York City, New York, USA in accordance with the rules, then obtaining, of
the American Arbitration Association, and judgment upon the award rendered may
be entered in any court having jurisdiction thereof. Reasonable fees, costs and
expenses, including legal fees, incurred by any party in connection with such
arbitration shall be borne by such parties. Nothing in this Section 4.08 shall
limit any right that any party may otherwise have to seek to obtain preliminary
injunctive relief in order to preserve the status quo pending the disposition of
any such arbitration proceeding.
SECTION 4.9. ENTIRE AGREEMENT; AMENDMENTS. This Agreement and the other
writings referred to herein or delivered pursuant hereto which form a part
hereof contain the entire understanding of the parties with respect is to its
subject matter. This Agreement supersedes all prior agreements and
understandings among the parties with respect to its subject matter. This
Agreement may be amended and the observance of any term of this Agreement may be
waived (either generally or in a particular instance and either retroactively or
prospectively) only by a written instrument duly executed by each of the
parties, which shall be binding on all of the parties.
SECTION 4.10. COUNTERPARTS. This Agreement may be executed in two or more
counterparts, each of which shall be deemed an original, but all of which
together shall constitute one and the same instrument.
<PAGE>
16
IN WITNESS WHEREOF, the parties hereto have executed this Agreement as
of the date first above written.
GETTY COMMUNICATIONS PLC
By:_____________________________________
Name:
Title:
THE TRUSTEES OF THE OCTOBER 1993 TRUST
By: ______________________________________
Name:
Title:
CREDITON LIMITED
By: ______________________________________
Name:
Title:
<PAGE>
Exhibit 99.3
REGISTRATION RIGHTS AGREEMENT AMENDMENT
REGISTRATION RIGHTS AGREEMENT AMENDMENT, dated as of February 9,
1998 (this "AMENDMENT"), among Getty Communications plc, a public limited
company organized under the laws of England and Wales ("GETTY COMMUNICATIONS"),
each of the trustees of the October 1993 Trust and Crediton Limited (together
the "RIGHTS HOLDERS" and each individually, a "RIGHTS HOLDER") and Getty Images,
Inc., a Delaware corporation ("GETTY IMAGES").
WHEREAS, Getty Communications and the Rights Holders entered into the
Registration Rights Agreement dated as of July 3, 1996 (the "REGISTRATION RIGHTS
AGREEMENT") pursuant to which the Rights Holders were granted certain
registration rights with respect to Class B ordinary shares, nominal value one
pence per share ("GETTY CLASS B ORDINARY SHARES"), of Getty Communications held
by the Rights Holders, a copy of which is attached hereto as Exhibit A;
WHEREAS, pursuant to a Merger Agreement dated as of September 15, 1997
(the "MERGER AGREEMENT"), among Getty Images, Getty Communications, PhotoDisc,
Inc., a Washington corporation, and Print Merger, Inc., a Washington corporation
and a wholly owned subsidiary of Getty Images, Getty Images and Getty
Communications will enter into a scheme of arrangement (the "SCHEME OF
ARRANGEMENT") in accordance with the Companies Act of 1985 of Great Britain
(unless otherwise defined herein, capitalized terms used herein shall have the
meanings ascribed thereto in the Merger Agreement);
WHEREAS, pursuant to the Scheme of Arrangement, each issued Class B
ordinary share, nominal value one pence per share ("GETTY CLASS B ORDINARY
SHARES") of Getty Communications will be converted into one Class A ordinary
share, par value one pence per share ("GETTY CLASS A ORDINARY SHARES", and,
together with the Getty Class B Ordinary Shares, the "GETTY ORDINARY SHARES"),
of Getty Communications, each Getty Ordinary Share will be transferred to Getty
Images or its nominees and the holders of Getty Ordinary Shares will be issued
one share of common stock, par value $0.01 per share ("GETTY IMAGES SHARES"), of
Getty Images for every two Getty Ordinary Shares held of record by such holders,
and Getty Communications will become a wholly owned subsidiary of Getty Images;
WHEREAS, upon the consummation of the Scheme of Arrangement, the
Rights Holders will hold only Getty Images Shares; and
WHEREAS, the parties each desire to amend the Registration Rights
Agreement pursuant to Section 4.9 thereof and to make certain covenants and
agreements concerning the registration from time to time under the Securities
Act of 1933, as amended (the "SECURITIES ACT"), of Getty Images Shares held by
the Rights Holders.
<PAGE>
2
NOW, THEREFORE, in consideration of the mutual promises,
representations, warranties and conditions contained herein, the parties agree
as follows:
SECTION 1.01. AMENDMENT. Each of the parties agrees that, upon the
consummation of the Scheme of Arrangement, the Registration Rights Agreement
shall be amended such that (i) the "Company" as used therein shall refer to
Getty Images rather than Getty Communications and (ii) "Registrable Shares" as
used therein shall include Getty Images Shares issued in the Scheme of
Arrangement in respect of Registrable Shares as defined in the Registration
Rights Agreement. The terms and conditions of the Registration Rights Agreement
shall inure to the benefit of Getty Images as the successor to Getty
Communications and any rights or obligations of Getty Communications shall
become the sole obligation of Getty Images.
IN WITNESS WHEREOF, each of Getty Communications, the Rights Holders
and Getty Images has duly executed, or has caused this Amendment to be duly
executed by its duly authorized representative, as of the date first written
above.
GETTY
COMMUNICATIONS PLC
By:
------------------------------
Name: Mark Getty
Title:
------------------------------
Lawrence J. Could
------------------------------
Mark H. Getty
<PAGE>
3
------------------------------
Jonathan D. Klein
GETTY IMAGES, INC.
By:
------------------------------
Name: Mark Torrance
Title: Co-Chairman
<PAGE>
JOINT FILING AGREEMENT
The undersigned hereby agree that the Statement on Schedule 13D, dated
February 19, 1998, (the "Schedule 13D"), with respect to the common stock, par
value $0.01 per share, of Getty Images, Inc., a Delaware corporation is, and any
amendments thereto executed by each of us shall be, filed on behalf of each of
us pursuant to and in accordance with the provisions of Rule 13d-1(f) under the
Securities and Exchange Act of 1934, as amended, and that this Agreement shall
be included as an Exhibit to the Schedule 13D and each such amendment. Each of
the undersigned agrees to be responsible for the timely filing of the Schedule
13D and any amendments thereto, and for the completeness and accuracy of the
information concerning itself contained therein. This Agreement may be executed
in any number of counterparts, all of which taken together shall constitute one
and the same instrument.
IN WITNESS WHEREOF, the undersigned have executed this Agreement as of
the 19th day of February, 1998.
MARK H. GETTY
By /s/ Mark H. Getty
---------------------------------
Name: Mark H. Getty
Title:
THE OCTOBER 1993 TRUST
By /s/ Authorised Signatory
---------------------------------
Name:
Title: Authorised Signatory
