sc13d
UNITED STATES SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
SCHEDULE 13D
Under the Securities Exchange Act of 1934
WiderThan Co., Ltd.
(Name of Issuer)
(1) Common Stock, par value KRW 500 per share
(2) American Depositary Shares, evidenced by American Depositary Receipts, each representing one common share
(Title of Class of Securities)
The Common Stock, which is not traded on U.S. markets, has not been assigned a CUSIP number
The CUSIP number for the related American Depositary Shares is 967593104
(CUSIP Number)
Robert Kimball, Senior Vice President, Legal and Business Affairs, General Counsel and Corporate Secretary
RealNetworks, Inc.
2601 Elliott Avenue, #1000
Seattle, Washington 98121
(206) 674-2700
(Name, Address and Telephone Number of Person Authorized to Receive Notices and Communications)
Copies to:
Patrick J. Schultheis, Esq.
Michael S. Ringler, Esq.
Wilson Sonsini Goodrich & Rosati Professional Corporation
701 Fifth Avenue, Suite 5100
Seattle, WA 98104-7036
(206) 883-2500
(Date of Event Which Requires Filing of this Statement)
If the filing person has previously filed a statement on Schedule 13G to report the
acquisition that is the subject of this Schedule 13D, and is filing this schedule because of Rule
13d-1(e), 13d-1(f) or 13d-1(g), check the following box o.
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CUSIP No. |
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967593104 |
Schedule 13D |
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NAMES OF REPORTING PERSONS:
REALNETWORKS,INC. |
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I.R.S. IDENTIFICATION NOS. OF ABOVE PERSONS (ENTITIES ONLY): 91-1628146 |
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CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP (SEE INSTRUCTIONS):
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(a) o |
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(b) þ |
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SEC USE ONLY: |
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SOURCE OF FUNDS (SEE INSTRUCTIONS): OO |
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CHECK IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO ITEMS 2(d) OR 2(e): |
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CITIZENSHIP OR PLACE OF ORGANIZATION: Washington |
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SOLE VOTING POWER: |
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None |
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SHARED VOTING POWER: |
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| OWNED BY |
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8,628,3591 |
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SOLE DISPOSITIVE POWER: |
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None |
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SHARED DISPOSITIVE POWER: |
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None |
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AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON: |
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8,628,3591 |
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CHECK IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES (SEE INSTRUCTIONS): |
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PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11): |
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44%1 |
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TYPE OF REPORTING PERSON (SEE INSTRUCTIONS): |
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CO |
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Pursuant to the Shareholder Tender and Voting Agreements described
below, RealNetworks may be deemed to have beneficial ownership of WiderThan
common stock outstanding on the record date of any vote at a shareholder
meeting for certain events as set forth in the Shareholder Tender and Voting Agreements.
Based on 19,807,216 shares of WiderThan common stock outstanding as of
September 12, 2006 as set forth in the Combination Agreement, RealNetworks may
be deemed to have beneficial ownership of approximately 44% of the outstanding
WiderThan common stock if the record date were September 12, 2006. Neither the
filing of this Statement on Schedule 13D nor any of its contents shall be
deemed to constitute an admission by RealNetworks that it is the beneficial
owner of any of the common stock referred to herein for purposes of Section
13(d) of the Securities Exchange Act of 1934, as amended (the “Exchange
Act”), or for any other purpose, and such beneficial ownership is
expressly disclaimed. |
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TABLE OF CONTENTS
SCHEDULE 13D
Item 1. Security and Issuer.
This statement on Schedule 13D (this “Statement”) relates to the common stock, par value
KRW500 per share (“Common Stock”) of WiderThan Co., Ltd., a chusik hoesa duly organized under the
laws of the Republic of Korea (“WiderThan”). WiderThan’s principal executive offices are located at
17F, K1 REIT Building, 463, Chungjeong-ro-3-ga, Seodaemun-gu, Seoul M5 120-709, Korea.
Item 2. Identity and Background.
(a)-(c) This Statement is being filed by RealNetworks, Inc., a Washington corporation
(“RealNetworks”). RealNetworks has its principal office at 2601 Elliott Avenue, Suite 1000,
Seattle, Washington 98121. The principal business of RealNetworks is the development and marketing
of digital entertainment products and services. The name, business address and present principal
occupation or employment of each executive officer and director of RealNetworks, and the name,
principal place of business and address of any corporation or other organization in which such
employment is conducted, are set forth on Schedule I hereto and incorporated herein by reference.
(d)-(e) During the last five years, neither RealNetworks nor, to RealNetworks’ knowledge, any
person named in Schedule I hereto, 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.
(f) The citizenship of each executive officer and director of RealNetworks is set forth on
Schedule I.
Item 3. Source and Amount of Funds or Other Consideration.
As described in
response to Item 4, the Covered Shares (as defined below in Item 4) to which
this Statement relates have not been purchased by RealNetworks, and thus no funds were used for
such purpose. As an inducement for RealNetworks to enter into the Combination Agreement described
in Item 4 and in consideration thereof, the Shareholders (defined below in Item 4) entered into
Shareholder Tender and Voting Agreements, dated as of September 12, 2006 (the “Voting Agreements”) with, and
granted an irrevocable proxy to, RealNetworks with respect to the Covered Shares. RealNetworks did
not pay additional consideration to the Shareholders in connection with the execution and delivery
of the Voting Agreements. For a description of the Voting Agreements, see Item 4 below, which
description is incorporated herein by reference in response to this Item 3.
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Item 4. Purpose of Transaction.
(a), (d), (g), (h) and (i) As an inducement for RealNetworks to enter into the Combination
Agreement (as defined below), the Shareholders entered into the Voting Agreements. The purpose of
the Voting Agreements is to facilitate the consummation of the transactions contemplated by the
Combination Agreement.
Combination Agreement
On September 12, 2006, RealNetworks, RN International Holdings B.V., a private company with
limited liability organized under the laws of the Netherlands and an indirect wholly-owned
subsidiary of RealNetworks (“RN BV”), and WiderThan entered into a Combination Agreement, pursuant
to which RN BV is offering to purchase all outstanding shares of common stock, par value KRW500 per
share (the “Common Shares”) and all outstanding American Depositary Shares, each representing one
Common Share and evidenced by an American Depositary Receipt issued by JP Morgan Chase Bank, N.A.
(the “ADSs”) of WiderThan, for $17.05 U.S. dollars per Common Share and per ADS (the “Offer”). Upon
the closing of the Offer, WiderThan will become a direct subsidiary of RN BV and an indirect
subsidiary of RealNetworks. Common Shares and ADSs that are not tendered in the Offer will remain
outstanding after the Offer unless and/or until they are acquired in any future acquisition.
Following the Offer, RealNetworks currently intends to acquire any remaining outstanding Common
Shares pursuant to one or more transactions permitted under Korean law, but is under no obligation
to acquire such Common Shares.
WiderThan’s stock options will remain outstanding following the closing of the Offer.
Pursuant to the Combination Agreement, on or before the 60th day following the closing of the
initial offering period (or any subsequent offering periods, if applicable), RealNetworks will
offer each WiderThan optionholder the opportunity to cancel his or her stock option in exchange for
the right to receive a cash payment, to be made as and when each stock option would otherwise vest,
in an amount (net of applicable taxes) equal to the number of shares of common stock for which the
option would otherwise vest multiplied by an amount equal to $17.05 less the applicable option
exercise price. RealNetworks is required under the Combination Agreement to maintain sufficient
liquid funds to satisfy such option consideration payments. In addition, if on or prior to the 60th
day following the closing of the initial offering period (or any subsequent offering period),
RealNetworks has commenced and is pursuing a transaction or series of transactions that will result
in the holders of WiderThan options receiving (or being entitled to receive) the foregoing option
consideration, then RealNetworks will not be required to commence the offer to optionholders
described above.
The Offer is conditioned upon, among other things, the written and notarized resignation of
each director of WiderThan effective as of the time at which the Offer closes pursuant to the terms
of the Combination Agreement.
Pursuant to the terms of the Combination Agreement, WiderThan will convene a special meeting
of its shareholders immediately following consummation of the Offer for the purpose of considering
and voting on shareholder proposals (1) to elect RealNetworks’ designees to the
board of directors of
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WiderThan (which designees will constitute the entire board of directors
of WiderThan following the transaction), (2) to amend WiderThan’s articles of incorporation to
eliminate cumulative voting and to provide for certain mechanics with respect to the issuance of
shares and share certificates and (3) to vote on such other matters as may properly be brought
before a shareholders meeting (the “Shareholder Proposals”).
Common Shares and ADSs that are not tendered in the Offer will remain outstanding after the
Offer unless and/or until they are acquired in any future acquisition. However, WiderThan will
apply for delisting of the ADSs from the Nasdaq Global Market and for termination of registration
of the Common Shares and ADSs under the Exchange Act as soon after the
completion of the Offer as the requirements for such delisting and termination are met. Following
the consummation of the Offer (but prior to any subsequent offering period, if any), WiderThan will
terminate the existing ADS deposit agreement between WiderThan and JP Morgan Chase Bank, N.A.,
dated as of December 2005 (the “Deposit Agreement”), under which the ADSs were issued. If the
Deposit Agreement is terminated, each ADS will be converted into the right to receive one Common
Share in exchange for such ADS.
Voting Agreements
In connection with the execution of the Combination Agreement, on September 12, 2006,
RealNetworks, RN BV and WiderThan entered into a Tender and Voting Agreement with each of Excelsior
VI-A C.V., Excelsior VI-B C.V., Excelsior VI, L.P., GAP Coinvestment Partners II, L.P., General
Atlantic Partners 64, L.P., i-Hatch Advisors, L.P., i-Hatch Ventures, L.P., i-Hatch WTC Holdings,
LLC, Nokia Venture Partners II, L.P., NVP II Affiliates Fund, L.P., Patricof Private Investment
Club III, L.P., SAIF Capital Limited and SK Telecom Co., Ltd. (collectively, the “Shareholders”),
pursuant to which the Shareholders executed proxies with respect to a number of Common
Shares equal to approximately 44% of the currently outstanding Common Shares (the “Covered
Shares”), and agreed to vote to the extent not voted by the persons appointed as proxies, in favor
of any proposals necessary or otherwise designed to effect the transactions contemplated by the
Combination Agreement (the “Proposed Transaction”) including the Shareholder Proposals (as defined
above in Item 4), at every meeting of the shareholders of WiderThan at which such matters are
considered.
Further, the Shareholders agreed to vote against (1) approval or adoption of any proposal made
in opposition to, or in competition with, the Proposed Transaction and (2) against any of the
following (to the extent unrelated to the Proposed Transaction): (a) any transaction, share
exchange or business combination involving WiderThan or any of its subsidiaries other than the
Proposed Transaction, (b) any sale, lease or transfer of all or substantially all of the assets of
WiderThan or any of its subsidiaries, (c) any reorganization, recapitalization, dissolution,
liquidation or winding up of WiderThan or any of its subsidiaries, (d) any other action that is
intended, or could reasonably be expected to, impede, interfere with, delay, postpone, discourage
or adversely affect the consummation of the Proposed Transaction; or (e) any transaction that would
constitute an acquisition transaction pursuant to the Combination Agreement. Additionally, each
Shareholder agreed to tender their Covered Shares in the Offer.
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In furtherance of the Shareholders’ covenants under the Voting Agreements, the Shareholders
designated RealNetworks, and its executive officers in their capacities as such, as agent, proxy
and attorney-in-fact to vote the Covered Shares in the manner described above.
Subject to the terms of the Voting Agreements, until the Expiration Date, the Shareholders
also agreed not to transfer, or enter into any agreement with respect to a transfer of, any of the
Covered Shares.
The Voting Agreements terminate as of the earlier of such date and time as the Combination
Agreement shall have been validly terminated pursuant to its terms or the completion of the meeting
of the shareholders of WiderThan contemplated by the Combination Agreement (the “Expiration Date”).
The foregoing descriptions of the Voting Agreements and the Combination Agreement are
qualified in their entirety by reference to the full text of such agreements. The Combination
Agreement and the Form of Voting Agreement are filed as Exhibit 1 and Exhibit 2, respectively, and
are incorporated herein by reference.
Except as set forth in
this Statement, the Voting Agreements and the Combination Agreement,
neither RealNetworks, RN BV nor, to RealNetworks’ knowledge, any person named on Schedule I has
any present plans or proposals which relate to or would result in any of the actions specified in
clauses (b), (c), (e), (f) or (j) of Item 4 of Schedule 13D.
Item 5. Interest in Securities of the Issuer.
(a) Pursuant
to the Voting Agreements, RealNetworks may be deemed to have beneficial ownership
of Common Shares outstanding on the record date of any vote at a shareholder meeting for certain
events as set forth in the Voting Agreements. Based on 19,807,216 Common Shares
outstanding as of September 12, 2006 as set forth in the Combination Agreement, RealNetworks may be
deemed to have beneficial ownership of approximately 44% of the outstanding Common Shares
if the record date were September 12, 2006. Neither the filing of this Statement on Schedule 13D
nor any of its contents shall be deemed to constitute an admission by RealNetworks that it is the
beneficial owner of any of the Common Shares referred to herein for purposes of Section 13(d) of the
Exchange Act or for any other purpose, and such beneficial ownership is expressly
disclaimed. To RealNetworks’ knowledge, no Common Shares are beneficially owned by any of
the persons listed on Schedule I.
(b) Pursuant to the Voting Agreements, RealNetworks may be deemed to have shared power to vote
8,628,359 Common Shares held by the Shareholders.
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Contracts, Arrangements, Understandings or Relationships With Respect to
Securities of the Issuer. |
Other than as described in Items 3, 4 and 5, to RealNetworks’ knowledge there are no
contracts, arrangements, understandings or relationships (legal or otherwise) between any of the
persons named in Item 2 or Schedule I and any person with respect to any securities of
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WiderThan, including, without limitation, the transfer or voting of any of the securities,
finder’s fees, joint ventures, loan or option arrangements, puts or calls, guarantees of profits,
divisions of profits or losses, or the giving or withholding of proxies or any pledge or
contingency, the occurrence of which would give another person voting or investment power over the
securities of WiderThan.
Item 7. Material to be Filed as Exhibits.
See exhibit index.
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SIGNATURE
After reasonable inquiry and to best of my knowledge and belief, I certify that the
information set forth in this statement is true, complete and correct.
Dated: September 22, 2006
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RealNetworks, Inc. |
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By:
Name:
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/s/ Robert Kimball
Robert Kimball
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Title:
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Senior Vice President, Legal and Business
Affairs, General Counsel and Corporate
Secretary |
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EXHIBIT INDEX
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Exhibit Name |
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1.
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Combination Agreement dated as of September 12, 2006, by and between RealNetworks, RN BV and
WiderThan (incorporated by reference from Exhibit 2.1 to RealNetworks’ Current Report on Form
8-K filed with the Securities and Exchange Commission on September 14, 2006). |
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2.
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Form of Shareholder Tender and Voting Agreement dated as of September 12, 2006, by and
between RealNetworks, RN BV, WiderThan and certain shareholders of WiderThan. |
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SCHEDULE I
This Schedule I sets forth a list of the directors and executive officers of RealNetworks, the
business address and present principal occupation or employment of each such director or executive
officer, and the name and address of any corporation or organization in which such employment is
conducted. To RealNetworks’ knowledge, all directors and officers listed below are citizens of the
United States.
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Present Principal Occupation or Employment and |
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Name, Principal Business and Address of Corporation |
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Business Address |
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in which Employment is Conducted |
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Robert Glaser
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2601 Elliott Avenue, #1000
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Chairman of the Board and Chief Executive Officer |
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Seattle, WA 98121
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and Shareholders |
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RealNetworks, Inc. |
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2601 Elliott Avenue, #1000 |
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Seattle, WA 98121 |
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Eric A. Benhamou
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540 Cowper Street, #200
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Chairman and Chief Executive Officer of Benhamou |
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Palo Alto, CA 94301
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Global Ventures |
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Venture capital investments |
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540 Cowper Street, #200 |
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Palo Alto, CA 94301 |
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Edward Bleier
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1325 Avenue of the
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Retired President and Consultant, Warner Bros. |
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Americas, 30th Floor
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Entertainment |
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New York, NY 10019
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1325 Avenue of the Americas, 30th Floor |
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New York, NY 10019 |
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James Breyer
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428 University Avenue
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Partner, Accel Partners |
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Palo Alto, CA 94301
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Venture capital investments |
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428 University Avenue |
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Palo Alto, CA 94301 |
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Jeremy Jaech
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1420 Fifth Avenue, #4400
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Chief Executive Officer, Trumba Corporation |
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Seattle, WA 98101
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Calendar communications development and marketing |
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1420 Fifth Avenue, #4400 |
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Seattle, WA 98101 |
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Jonathan D. Klein
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601 N. 34th Street
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Chief Executive Officer, Getty Images Inc. |
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Seattle, WA 98103
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Imagery, film and digital services |
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601 N. 34th Street |
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Seattle, WA 98103 |
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Kalpana Raina
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One Canada Square
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Executive Vice President, The Bank of New York |
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London, U.K. E14 5AL
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Financial services |
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One Wall Street |
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New York, NY 10286 |
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Michael Eggers
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2601 Elliott Avenue, #1000
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Senior Vice President, Chief Financial Officer |
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Seattle, WA 98121
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and Treasurer |
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RealNetworks, Inc. |
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2601 Elliott Avenue, #1000 |
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Seattle, WA 98121 |
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Present Principal Occupation or Employment and |
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Name, Principal Business and Address of Corporation |
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in which Employment is Conducted |
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Savino (Sid) Ferrales
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2601 Elliott Avenue, #1000
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Senior Vice President, Human Resources |
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Seattle, WA 98121
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RealNetworks, Inc. |
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2601 Elliott Avenue, #1000 |
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Seattle, WA 98121 |
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John Giamatteo
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2601 Elliott Avenue, #1000
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Executive Vice President, Worldwide Technology |
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Seattle, WA 98121
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Products and Services and International |
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Operations |
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RealNetworks, Inc. |
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2601 Elliott Avenue, #1000 |
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Seattle, WA 98121 |
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Robert Kimball
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2601 Elliott Avenue, #1000
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Senior Vice President, Legal and Business |
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Seattle, WA 98121
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Affairs, General Counsel and Corporate Secretary |
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RealNetworks, Inc. |
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2601 Elliott Avenue, #1000 |
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Seattle, WA 98121 |
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Michael Schutzler
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2601 Elliott Avenue, #1000
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Senior Vice President, Games Division and |
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Seattle, WA 98121
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Advertising Operations |
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RealNetworks, Inc. |
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2601 Elliott Avenue, #1000 |
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Seattle, WA 98121 |
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Daniel C. Sheeran
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2601 Elliott Avenue, #1000
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Senior Vice President, Music and Video |
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Seattle, WA 98121
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RealNetworks, Inc. |
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2601 Elliott Avenue, #1000 |
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Seattle, WA 98121 |
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Carla Stratfold
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2601 Elliott Avenue, #1000
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Senior Vice President, North American Sales |
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Seattle, WA 98121
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RealNetworks, Inc. |
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2601 Elliott Avenue, #1000 |
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Seattle, WA 98121 |
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Harold Zeitz
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2601 Elliott Avenue, #1000
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Senior Vice President, Media Software and Services |
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Seattle, WA 98121
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RealNetworks, Inc. |
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2601 Elliott Avenue, #1000 |
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Seattle, WA 98121 |
2
SCHEDULE II
This Schedule II sets forth the name, place of organization, principal business, and principal
office address of Shareholders agreeing to tender Covered Shares of WiderThan in the Offer. The
information set forth below is based on information provided by WiderThan and information contained
in reports filed with the Securities and Exchange Commission. While RealNetworks has no reason to
believe that such information is not reliable, RealNetworks makes no representation or warranty
with respect to the accuracy or completeness of such information.
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Place of |
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Principal Business |
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Address of Principal Office |
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Excelsior VI-A C.V.
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The Netherlands
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Venture financing /
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445 Park Avenue, 11th Floor |
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venture capital
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New York, NY 10022 |
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Excelsior VI-B C.V.
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The Netherlands
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Venture financing /
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445 Park Avenue, 11th Floor |
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venture capital
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New York, NY 10022 |
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Excelsior VI, L.P.
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Delaware
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Venture financing /
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445 Park Avenue, 11th Floor |
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venture capital
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New York, NY 10022 |
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GAP Coinvestment
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Delaware
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Venture financing /
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c/o General Atlantic Service Corporation |
Partners II, L.P.
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venture capital
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3 Pickwick Plaza |
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Greenwich, CT 06830 |
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General Atlantic
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Delaware
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Venture financing /
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c/o General Atlantic Service Corporation |
Partners 64, L.P.
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venture capital
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3 Pickwick Plaza |
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Greenwich, CT 06830 |
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i-Hatch Advisors, L.P.
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Delaware
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Venture financing /
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599 Broadway, 8th Floor |
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venture capital
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New York, NY 10012 |
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i-Hatch Ventures, L.P.
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Delaware
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Venture financing /
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599 Broadway, 8th Floor |
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venture capital
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New York, NY 10012 |
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i-Hatch WTC Holdings,
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Delaware
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Venture financing /
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599 Broadway, 8th Floor |
LLC
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venture capital
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New York, NY 10012 |
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Nokia Venture Partners
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Delaware
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Venture financing /
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Middlefield Road, Suite 210 |
II, L.P.
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venture capital
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Menlo Park, CA 94025 |
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NVP II Affiliates
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Delaware
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Venture financing /
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Middlefield Road, Suite 210 |
Fund, L.P.
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venture capital
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Menlo Park, CA 94025 |
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Patricof Private
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Delaware
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Venture financing /
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445 Park Avenue, 11th Floor |
Investment Club III, L.P.
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venture capital
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New York, NY 10022 |
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SAIF Capital Limited
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Malta
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Venture financing /
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136, St. Christopher Street |
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venture capital
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Valetta, VLT 05, Malta |
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SK Telecom Co., Ltd.
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Republic of Korea
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Telecommunications
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11, Euljiro2-GA, Jung-GU |
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services
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Seoul M5 100-999, Korea |
3
EXHIBIT 2
Execution Version
STOCKHOLDER TENDER AND VOTING AGREEMENT
This Stockholder Tender And Voting Agreement (this “Agreement”) is made and entered
into as of September 12, 2006, by and among RealNetworks, Inc., a Washington corporation (“Buyer”),
RN International Holdings B.V., a besloten vennootschap duly organized under the laws of the
Netherlands and an indirect wholly owned subsidiary of Buyer (“Offering Subsidiary”), WiderThan
Co., Ltd., a chusik hoesa duly organized under the laws of the Republic of Korea (the “Company”),
and the undersigned stockholder (“Stockholder”) of the Company.
RECITALS
A. Concurrently with the execution and delivery hereof, Buyer, Offering Subsidiary and the
Company are entering into a Combination Agreement of even date herewith (as it may be amended from
time to time pursuant to the terms thereof, the “Combination Agreement”), which provides for, among
other things, a cash tender offer made by the Offering Subsidiary (as it may be amended from time
to time as permitted under the Combination Agreement, the “Offer”) to purchase all of the issued
and outstanding shares of capital stock of the Company (individually, a “Company Share” and
collectively, the “Company Shares”) and all of the issued and outstanding Company ADSs (together
with the Company Shares, the “Company Securities” and each, a “Company Security”) at a price of
U.S. $17.05 per Company Security (the “Per Share Cash Consideration”).
B. Stockholder is the beneficial owner (as defined in Rule 13d-3 under the Securities Exchange
Act of 1934, as amended (the “Exchange Act”)) of such number of shares of each class of capital
stock of the Company as is indicated on the signature page of this Agreement.
C. In consideration of the execution and delivery of the Combination Agreement by Buyer,
Stockholder desires to agree to (i) tender the Shares (as defined herein) held by Stockholder in
the Offer and (ii) vote the Shares (as defined herein) over which Stockholder has voting power so
as to facilitate the consummation of the Transaction.
NOW, THEREFORE, intending to be legally bound, the parties hereto hereby agree as follows:
1. Certain Definitions.
(a) Capitalized terms used but not otherwise defined herein shall have the meanings ascribed
thereto in the Combination Agreement. For all purposes of and under this Agreement, the following
terms shall have the following respective meanings:
“Shares” means (i) all shares of capital stock or voting securities of the
Company owned, beneficially or of record, by Stockholder as of the date hereof, including
Company ADSs, and (ii) all additional shares of capital stock or voting securities of the
Company acquired by Stockholder, including Company ADSs, beneficially or of record, during the
period commencing with the execution and delivery of this Agreement and expiring on the
Expiration Date (as defined in Section 12 below).
“Transfer” means, with respect to any security, the direct or indirect
assignment, sale, transfer, tender, pledge, hypothecation, or the grant, creation or
suffrage of a lien or encumbrance in or upon, or the gift, placement in trust, the sale of
an option or contract to purchase, the purchase of any option or contract to sell, the grant
of an option, right or warrant for the sale, or other disposition of such security
(including transfers by testamentary or intestate succession or otherwise by operation of
law) or any right, title or interest therein (including, but not limited to, any right or
power to vote to which the holder thereof may be entitled, whether such right or power is
granted by proxy or otherwise), or the record or beneficial ownership thereof, the offer to
make such a sale, transfer, or other disposition, and each agreement, arrangement or
understanding, whether or not in writing, to effect any of the foregoing.
2. Transfer and Voting Restrictions.
(a) At all times during the period commencing on the date hereof and expiring on the
Expiration Date, Stockholder shall not, except pursuant to the Offer , Transfer any of the Shares,
unless each Person to which any of such Shares or any interest in any of such Shares, is or may be
Transferred shall have: (i) executed a counterpart of this Agreement, and (ii) agreed in writing to
hold such Shares (or interest in such Shares) subject to all of the terms and provisions of this
Agreement. Stockholder agrees that this Agreement and the obligations hereunder shall be binding
upon any person or entity to which legal or beneficial ownership of the Shares shall pass, whether
by operation of law or otherwise.
(b) Stockholder understands and agrees that if Stockholder attempts to Transfer, vote or
provide any other person with the authority to vote any of the Shares other than in compliance with
this Agreement or the Combination Agreement, the Company shall not, and Stockholder hereby
unconditionally and irrevocably instructs the Company to not, (a) permit any such Transfer on its
books and records, (b) issue a new certificate representing any of the Shares or (c) record such
vote unless and until Stockholder shall have complied with the terms of this Agreement. The
Stockholder hereby agrees to authorize and request the Company to notify its transfer agent that
there is a stop transfer order with respect to all of the Shares and that this Agreement places
limits on the voting of the Shares.
(c) From and after the date hereof through and until the Expiration Date, except as otherwise
permitted by this Agreement, the Combination Agreement or by order of a court of competent
jurisdiction, Stockholder will not commit any act that could restrict or otherwise affect his legal
power, authority and right to vote all of the Shares then owned of record or beneficially by
Stockholder. Without limiting the generality of the foregoing, except for this Agreement and as
otherwise permitted by this Agreement, from and after the date hereof through and until the
Expiration Date, Stockholder will not enter into any voting agreement with any person or entity
with respect to any of the Shares, grant any person or entity any proxy (revocable or irrevocable)
or power of attorney with respect to any of the Shares, deposit any of the Shares in a voting trust
or otherwise
enter into any agreement or arrangement with any person or entity limiting or affecting
Stockholder’s legal power, authority or right to vote the Shares in favor of the approval of the
Proposed Transaction (as defined below) or against any Competing Transaction (as defined below).
- 2 -
3. Agreement to Vote Shares.
(a) Prior to the Expiration Date, at every meeting of the stockholders of the Company called,
and at every adjournment or postponement thereof, and on every action or approval by written
consent of the stockholders of the Company, Stockholder (in Stockholder’s capacity as such) shall
appear at the meeting or otherwise cause the Shares to be present thereat for purposes of
establishing a quorum and, to the extent not voted by the persons appointed as proxies pursuant to
this Agreement, vote (i) in favor of any proposals necessary or otherwise designed to effect the
transactions governed by the Combination Agreement including, immediately following the closing of
the Offer, the election as director of the Company those individuals nominated by the Buyer and
any proposal to eliminate cumulative voting for the voting securities of the Company(collectively,
the “Proposed Transaction”), (ii) against the approval or adoption of any proposal made in
opposition to, or in competition with, the Proposed Transaction, and (iii) against any of the
following (to the extent unrelated to the Proposed Transaction): (A) any transaction, share
exchange or business combination involving the Company or any of its subsidiaries other than the
Proposed Transaction; (B) any sale, lease or transfer of all or substantially all of the assets of
the Company or any of its subsidiaries; (C) any reorganization, recapitalization, dissolution,
liquidation or winding up of the Company or any of its subsidiaries; (D) any other action that is
intended, or could reasonably be expected to, impede, interfere with, delay, postpone, discourage
or adversely affect the consummation of the Proposed Transaction or (E) any transaction that would
constitute an “Acquisition Transaction” pursuant to the Combination Agreement (each of (ii) and
(iii), a “Competing Transaction”)
(b) If Stockholder is the beneficial owner, but not the record holder, of the Shares,
Stockholder agrees to take all actions necessary to cause the record holder and any nominees to
appear at every meeting of the stockholders or otherwise cause the Shares to be present thereat for
the purpose of establishing a quorum and vote in accordance with Section 3(a).
4. Agreement to Tender. Stockholder shall tender (and shall not withdraw), pursuant
to and in accordance with the terms of the Offer, the Shares. No later than two (2) business days
prior to the initial expiration date of the Offer, Stockholder shall (i) deliver to the depositary
designated in the Offer, (A) a letter of transmittal with respect to the Shares complying with the
terms of the Offer, (B) certificates representing the Shares, and (C) all other documents or
instruments required to be delivered pursuant to the terms of the Offer, and/or (ii) instruct its
broker or such other person who is the holder of record of any Shares beneficially owned by
Stockholder to tender such Shares for exchange in the Offer pursuant to the terms and conditions of
the Offer. Stockholder shall not tender the Shares into any exchange or tender offer commenced by
a third party other than Buyer, Offering Subsidiaryor any other subsidiary of Buyer.
5. Grant of Irrevocable Proxy.
(a) Stockholder hereby revokes any and all other proxies or powers of attorney in respect of
any Shares and hereby irrevocably (to the fullest extent permitted by law) grants to, and
appoints, Buyer and each of its executive officers and any of them, in their capacities as
officers of Buyer, Stockholder’s agent, proxy and attorney-in-fact (with full power of substitution
and re-substitution), for and in the name, place and stead of Stockholder, to vote or cause to be
voted the
- 3 -
Shares, to instruct nominees or record holders to vote the Shares, or grant a consent or
approval in each case in the manner set forth in Section 3 above.
(b) Stockholder represents that any proxies heretofore given in respect of Stockholder’s
shares that may still be in effect are not irrevocable.
(c) Stockholder hereby affirms that the irrevocable proxy set forth in this Section 5 is given
in connection with the execution of the Combination Agreement, and that such irrevocable proxy is
given to secure the performance of the duties of Stockholder under this Agreement. Stockholder
hereby further affirms that the irrevocable proxy is coupled with an interest and may under no
circumstances be revoked. Stockholder hereby ratifies and confirms all that such irrevocable proxy
may lawfully do or cause to be done by virtue hereof.
(d) The attorneys and proxies named in Section 5(a) above may not exercise this irrevocable
proxy on any other matter except as provided above. Stockholder may vote the Shares on all matters
other than the matters provided above. The vote of the proxyholder shall control in any conflict
between the vote by the proxyholder of the Stockholder’s Shares in the manner provided in Section 3
above and a vote by Stockholder of Stockholder’s Shares.
(e) Notwithstanding the foregoing, the parties to this Agreement may agree to appoint a person
instead of Buyer as proxy and attorney-in-fact for the Stockholder on the same terms and conditions
as provided in Section 5(a).
6. No Solicitation. Stockholder, in his capacity as a Stockholder, shall not directly
or indirectly, (i) solicit or initiate, or knowingly encourage or induce, the making, submission or
announcement of, a Competing Transaction, (ii) furnish to any Person (other than Buyer, Offering
Subsidiary or any designees of Buyer or Offering Subsidiary) any non-public information relating
to the Company or any of its subsidiaries, or afford access to the business, properties, assets,
books or records of the Company or any of its subsidiaries to any Person (other than Buyer,
Offering Subsidiary or any designees of Buyer or Offering Subsidiary), or take any other action in
any such case with the intent to asset or facilitate any inquiries or the making of any proposal
that constitutes or could lead to a Competing Transaction, (iii) participate or engage in
discussions or negotiations with any Person with respect to a Competing Transaction, (iv) approve,
endorse or recommend a Competing Transaction, (v) enter into any letter of intent, memorandum of
understanding or contract contemplating or otherwise relating to a Competing Transaction, or (vi)
terminate, amend or waive any rights under any “standstill” or other similar agreement between the
Company or any of its subsidiaries and any Person (other than Buyer).
7. Action in Stockholder Capacity Only. Stockholder makes no agreement or
understanding herein as director or officer of the Company. Stockholder signs solely in his
capacity as a record holder and/or beneficial owner of Shares, and nothing herein shall limit or
affect any actions taken in his capacity as an officer or director of the Company.
8. Representations and Warranties of Stockholder. Stockholder hereby represents and
warrants to Buyer as follows:
- 4 -
(a) (i) Stockholder is the beneficial or record owner of the shares of capital stock of the
Company indicated on the signature page of this Agreement free and clear of any and all pledges,
liens, security interests, claims, charges, restrictions (contractual or regulatory), options or
encumbrances; (ii) Stockholder does not beneficially own any securities of the Company other than
the shares of capital stock and rights to purchase shares of capital stock of the Company set forth
on the signature page of this Agreement; (iii) Stockholder has full power and authority to make,
enter into and carry out the terms of this Agreement and to grant the irrevocable proxy as set
forth in Section 5 and to comply with and perform Stockholder’s obligations hereunder; (iv) this
Agreement has been duly and validly executed and delivered by Stockholder and constitutes a valid
and binding agreement of Stockholder enforceable against Stockholder in accordance with its terms;
and (v) the Shares are, and will be, at all times up until the closing of the Proposed Transaction,
free and clear of any liens, claims, options , charges, security interests, proxies, voting trusts,
agreements, rights, understandings or arrangements, or exercise of any rights of a stockholder in
respect of the Shares or other encumbrances.
(b) As of the date hereof and for so long as this Agreement remains in effect (including as of
the date of the Company Meeting, which, for purposes of this Agreement, includes any adjournment or
postponement thereof), except for this Agreement or as otherwise permitted by this Agreement,
Stockholder has full legal power, authority and right to vote all of the Shares then owned of
record or beneficially by him, in favor of the approval and authorization of the Proposed
Transaction without the consent or approval of, or any other action on the part of, any other
person or entity. Without limiting the generality of the foregoing, Stockholder has not entered
into any voting agreement (other than this Agreement) with any person or entity with respect to any
of the Shares, granted any person or entity any proxy (revocable or irrevocable) or power of
attorney with respect to any of the Shares, deposited any of the Shares in a voting trust or, other
than the Deposit Agreement, entered into any arrangement or agreement with any person or entity
limiting or affecting his legal power, authority or right to vote the Shares on any matter.
(c) The execution and delivery of this Agreement and the performance by Stockholder of
Stockholder’s agreements and obligations hereunder do not and will not result in any breach or
violation of or be in conflict with or constitute a default under or give to others any right to
terminate, amend, accelerate or cancel any right or obligation under, or result in the creation of
any lien or encumbrance on any Shares pursuant to, any term of any agreement, judgment, injunction,
order, decree, law, regulation or arrangement to which Stockholder is a party or by which
Stockholder (or any of his assets) is bound, except for any such breach, violation, conflict or
default which, individually or in the aggregate, would not (i) impair, impede, interfere with,
delay, postpone, discourage or adversely affect Stockholder’s ability to perform his obligations
under this Agreement or Buyer’s ability to exercise or obtain the benefit of any rights under this
Agreement or (ii) render inaccurate any of the representations made by Stockholder herein.
(d) No broker, investment banker, financial advisor or other person is entitled to any
broker’s, finder’s, financial adviser’s or other similar fee or commission in connection with the
transactions contemplated by the Combination Agreement or this Agreement based upon
arrangements made by or on behalf of Stockholder.
- 5 -
9. Waiver of Rights of Appraisal. Stockholder hereby waives any rights of appraisal
with respect to the Proposed Transaction, or rights to dissent from the Proposed Transaction, that
such Stockholder may have.
10. Regulatory Approvals. Each of the provisions of this Agreement is subject to
compliance with applicable regulatory conditions and receipt of any authorization, permit, consent,
or approval required by any foreign antitrust, competition or merger control law, or any state or
federal public body or authority.
11. Confidentiality. Stockholder recognizes that successful consummation of the
transactions contemplated by the Combination Agreement may be dependent upon confidentiality with
respect to the matters referred to herein. In this connection, pending public disclosure thereof,
and so that, to the extent applicable, Buyer may rely on the safe harbor provisions of Rule
100(b)(2)(ii) of Regulation FD, Stockholder hereby agrees not to disclose or discuss such matters
with anyone not a party to this Agreement (other than its counsel and advisors, if any) without the
prior written consent of Buyer and the Company, except for disclosures Stockholder’s counsel
advises are required by law, in which event Stockholder shall give notice of such disclosure to
Buyer and the Company as promptly as practicable (and in any event prior to making such disclosure)
so as to enable Buyer and the Company to seek a protective order from a court of competent
jurisdiction with respect thereto.
12. Termination. This Agreement shall terminate and be of no further force or effect
whatsoever as of the earlier of (i) such date and time as the Combination Agreement shall have been
validly terminated pursuant to the terms of Article VI thereof including, without limitation,
termination pursuant to Section 6.1(a)(vi) or (ii) the completion of meeting of the stockholders of
the Company held immediately after the Offer Closing (the “Expiration Date”); provided, however,
such termination shall not relieve any party from liability for the breach of any term of this
Agreement.
13. Miscellaneous Provisions.
(a) Amendments, Modifications and Waivers. No amendment, modification or waiver in
respect of this Agreement shall be effective against any party unless it shall be in writing and
signed by Buyer, Offering Subsidiary, Company and Stockholder.
(b) Entire Agreement. This Agreement, the Combination Agreement and the Share
Exchange Agreement constitute the entire agreement among the parties to this Agreement and
supersede all other prior agreements and understandings, both written and oral, among or between
any of the parties with respect to the subject matter hereof and thereof.
(c) Governing Law. This Agreement shall be governed by and construed in accordance
with the internal laws of the State of New York without giving effect to any choice or conflict of
law provision or rule (whether of the State of New York or any other jurisdiction) that would cause
the application of laws of any jurisdictions other than those of the State of New York.
Notwithstanding the foregoing or anything to the contrary set forth in this Agreement,
corporate actions of the Stockholder relating to a stockholders’ meeting and exercise of
stockholders’ rights in connection with this Agreement and any other transactions contemplated
hereby or thereby shall be governed exclusively by the laws of Republic of Korea.
- 6 -
(d) Jurisdiction; Arbitration. Any dispute, controversy or claim arising out of or in
connection with or relating to this Agreement, or the breach, termination, validity or invalidity
hereof, shall be finally settled by arbitration under the Rules of Arbitration of the International
Chamber of Commerce (the “Rules”) as are in force at the time of any such arbitration and as may be
amended by the provisions of this Section 13(d). The place of arbitration shall be New York, New
York. All arbitration proceedings shall be conducted in the English language. The arbitrators
shall decide any such dispute or claim strictly in accordance with the governing law specified
above. Judgment upon any arbitral award rendered hereunder shall be final and binding on the
parties and may be entered in any court having jurisdiction, or application may be made to such
court for a judicial acceptance of the award and an order of enforcement, as the case may be. Each
party shall cooperate in good faith to expedite (to the maximum extent practicable) the conduct of
any arbitral proceedings commenced under this Agreement. Notwithstanding the foregoing, the
parties may seek preliminary injunctive relief from any court of competent jurisdiction, pending
the final award of the Arbitration Board.
(e) WAIVER OF JURY TRIAL. EACH OF THE PARTIES IRREVOCABLY WAIVES ANY AND ALL RIGHTS
TO TRIAL BY JURY IN ANY ACTION OR PROCEEDING BETWEEN THE PARTIES ARISING OUT OF OR RELATING TO THIS
AGREEMENT AND THE TRANSACTIONS CONTEMPLATED BY THIS AGREEMENT.
(f) Attorneys’ Fees. In any action at law or suit in equity to enforce this Agreement
or the rights of any of the parties hereunder, the prevailing party in such action or suit shall be
entitled to receive a reasonable sum for its attorneys’ fees and all other reasonable costs and
expenses incurred in such action or suit.
(g) Assignment and Successors. This Agreement and all of the provisions hereof shall
be binding upon and inure to the benefit of the parties hereto and their respective successors and
permitted assigns, including, without limitation, Stockholder’s estate upon the death of
Stockholder, provided that except as otherwise specifically provided herein, neither this Agreement
nor any of the rights, interests or obligations of the parties hereto may be assigned by operation
of law or otherwise by any of the parties hereto without prior written consent of the other parties
hereto except that Buyer, without obtaining the consent of any other party hereto, shall be
entitled to assign this Agreement or all or any of its rights or obligations hereunder to any one
or more Affiliates of Buyer, but no assignment by Buyer under this Section 13(g) shall relieve
Buyer of its obligations under this Agreement. Any assignment in violation of the foregoing shall
be void and of no effect.
(h) No Third Party Rights. Nothing in this Agreement, express or implied, is intended
to or shall confer upon any Person (other than the parties hereto) any right, benefit or remedy of
any nature whatsoever under or by reason of this Agreement.
(i)
Cooperation. Stockholder agrees to cooperate fully with Buyer and to execute and
deliver such further documents, certificates, agreements and instruments and to take or cause to
be taken such other actions as may be reasonably requested by Buyer to consummate and make
effective and to evidence or reflect the Proposed Transaction and any other transactions
contemplated by this Agreement and to carry out the intent and purpose of this Agreement.
Stockholder hereby agrees that Buyer and Company may publish and disclose in any documents required
to be filed with the SEC, such Stockholder’s identity and ownership of Shares and the
- 7 -
nature of
such Stockholder’s commitments, arrangements and understandings under this Agreement and may
further file this Agreement as an exhibit to any filing made by Buyer or the Company with the SEC
relating to the Proposed Transaction.
(j) Severability. If any provision of this Agreement is held invalid or unenforceable
by any court of competent jurisdiction, the other provisions of this Agreement will remain in full
force and effect. Any provision of this Agreement held invalid or unenforceable only in part or
degree will remain in full force and effect to the extent not held invalid or unenforceable.
(k) Specific Performance; Injunctive Relief. The parties hereto acknowledge that
Buyer, Offering Subsidiary and Company shall be irreparably harmed and that there shall be no
adequate remedy at law for a violation of any of the covenants or agreements of Stockholder set
forth in this Agreement. Therefore, Stockholder hereby agrees that, in addition to any other
remedies that may be available to Buyer, Offering Subsidiary or the Company, as applicable upon any
such violation, such party shall have the right to enforce such covenants and agreements by
specific performance, injunctive relief or by any other means available to such party at law or in
equity without posting any bond or other undertaking.
(l) Notices. All notices, consents, requests, claims, demands and other
communications under this Agreement shall be in writing and shall be deemed given if (a) delivered
to the appropriate address by hand or overnight courier (providing proof of delivery), or (b) sent
by facsimile or e-mail with confirmation of transmission by the transmitting equipment confirmed
with a copy delivered as provided in clause (a), in each case to the parties at the following
address, facsimile or e-mail address (or at such other address, facsimile or e-mail address for a
party as shall be specified by like notice): (i) if to Buyer, Offering Subsidiary or Company, to
the address, e-mail address or facsimile provided in the Combination Agreement, including to the
persons designated therein to receive copies; and (ii) if to Stockholder, to Stockholder’s address,
e-mail address or facsimile shown below Stockholder’s signature on the last page hereof.
(m) Counterparts. This Agreement may be executed in several counterparts, each of
which shall be deemed an original and all of which shall constitute one and the same instrument,
and shall become effective when counterparts have been signed by each of the parties and delivered
to the other parties; it being understood that all parties need not sign the same counterpart.
(n) Headings. The headings contained in this Agreement are for the convenience of
reference only, shall not be deemed to be a part of this Agreement and shall not be referred to in
connection with the construction or interpretation of this Agreement.
(o) Legal Representation. This Agreement was negotiated by the parties with the
benefit of legal representation and any rule of construction or interpretation otherwise requiring
this
Agreement to be construed or interpreted against any party shall not apply to any construction
or interpretation thereof.
(p) Expenses. Each party hereto shall pay its own expenses incurred in connection
with this Agreement.
- 8 -
(q) Liquidated Damages. The parties hereby acknowledge and agree that damages arising
from the breach of Stockholder’s obligations under this Agreement may be difficult to quantify. As
a result, if Stockholder violates its obligations under this Agreement, Stockholder shall pay to
Buyer an amount of cash in U.S. dollars equal to the product of (a) U.S. $4 multiplied by
(b) the number of Shares held (directly or indirectly) by Stockholder. The parties agree that such
computation of damages is fair and reasonable. The application of this provision shall not prevent
a party hereto from enforcing its rights or augmenting its protection by other remedies as may be
available.
(r) No Ownership Interest. Nothing contained in this Agreement shall be deemed to
vest in Buyer any direct or indirect ownership or incidence of ownership of or with respect to any
Shares. All rights, ownership and economic benefits of and relating to the Shares shall remain
vested in and belong to the Stockholder, and Buyer shall have no authority to manage, direct,
superintend, restrict, regulate, govern, or administer any of the policies or operations of the
Company or exercise any power or authority to direct the Stockholder in the voting of any of the
Shares, except as otherwise provided herein.
[Signature pages follow.]
- 9 -
IN WITNESS WHEREOF, the undersigned have caused this Agreement to be duly executed as of the
date first above written.
REALNETWORKS, INC.
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By:
Name:
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/s/ Robert Glaser
Robert Glaser
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Title:
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Chief Executive Officer |
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RN INTERNATIONAL HOLDINGS B.V.
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By:
Name:
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/s/ Michael R. Eggers
Michael R. Eggers
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Title:
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Chief Financial Officer |
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WIDERTHAN CO., LTD.
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By:
Name:
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/s/ Park Sang Jun
Sang Jun Park
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Title:
|
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Chief Executive Officer |
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- 10 -
STOCKHOLDER:
General Atlantic Partners 64, LP
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By:
|
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General Atlantic LLC, its general partner |
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By:
Name:
|
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/s/ Matthew Nimetz
Matthew Nimetz
|
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Title:
|
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Managing Director |
|
|
- 11 -
STOCKHOLDER:
Excelsior VI-A CV
Excelsior VI-B CV
Excelsior VI, LP
Patricof Private Investment Club III, LP
| |
|
|
|
|
By:
Name:
|
|
/s/ Paul Vais
Paul Vias
|
|
|
Title:
|
|
General Manager, WTC Investment BVBA |
|
|
- 12 -
STOCKHOLDER:
GAP Coinvestment Partners II, LP
| |
|
|
|
|
By:
Name:
|
|
/s/ Matthew Nimetz
Matthew Nimetz
|
|
|
Title:
|
|
A General Partner |
|
|
- 13 -
STOCKHOLDER:
i-Hatch Advisors, LP
i-Hatch Ventures, LP
i-Hatch WTC Holdings, LLC
| |
|
|
|
|
By:
Name:
|
|
/s/ Randolph L. Austin
Randolph L. Austin
|
|
|
Title:
|
|
General Partner |
|
|
- 14 -
STOCKHOLDER:
Nokia Venture Partners II, LP
| |
|
|
|
|
By:
Name:
|
|
/s/ David Jaques
David Jaques
|
|
|
Title:
|
|
Chief Financial Officer |
|
|
- 15 -
STOCKHOLDER:
N.V.P. II Affiliates Fund, LP
| |
|
|
|
|
By:
Name:
|
|
/s/ David Jaques
David Jaques
|
|
|
Title:
|
|
Chief Financial Officer |
|
|
- 16 -
STOCKHOLDER:
SAIF Capital Limited
| |
|
|
|
|
By:
Name:
|
|
/s/ Carmel (Lino) Buttigieg
Carmel (Lino) Buttigieg
|
|
|
Title:
|
|
Director |
|
|
- 17 -
STOCKHOLDER:
SK Telecom Co., Ltd.
| |
|
|
|
|
By:
Name:
|
|
/s/ Dong Seob Jee
Dong Seob Jee
|
|
|
Title:
|
|
Vice President |
|
|
- 18 -