EXECUTION VERSION

 

REGISTRATION RIGHTS AGREEMENT

 

THIS REGISTRATION RIGHTS AGREEMENT (this “Agreement”) is made as of July 26,
2013 by and among Sequential Brands Group, Inc., a Delaware corporation (the
“Company”), and [    ] as the “Investor” and any Persons identified on the
signature page of any joinder agreements executed and delivered pursuant to
Section 9 and Section 10 hereof (each, including the Investor, a “Holder” and,
collectively, the “Holders”). Capitalized terms used but not otherwise defined
herein are defined in Section 13 hereof.

 

RECITALS:

 

WHEREAS, in connection with that certain Securities Purchase Agreement by and
between the Company and the Investor, dated July 25, 2013 (the “Purchase
Agreement”), and the offering contemplated thereby (the “PIPE Transaction”), the
Company has agreed, upon the terms and subject to the conditions set forth in
the Purchase Agreement, to issue and sell to the Investor an aggregate of
1,000,000 shares of the Company’s Common Stock;

 

WHEREAS, in accordance with the terms of the Purchase Agreement, the Company has
agreed to provide the Holders with certain registration rights;

 

NOW, THEREFORE, in accordance with the terms of the Purchase Agreement, and in
consideration of the premises and the mutual covenants contained herein and
other good and valuable consideration, the receipt and sufficiency of which are
hereby acknowledged, the Company and each of the Holders hereby agree as
follows:

 

Section 1. Shelf Registration.

 

(a)          Filing. The Company shall, as soon as commercially reasonable, but
in any event not later than 75 days after the Closing Date (as defined below)
(such date, the “Filing Deadline”), file a registration statement on any
permitted form that qualifies, and is available for, the resale of Registrable
Securities, with the Commission in accordance with and pursuant to Rule 415
promulgated under the Securities Act (or any successor rule then in effect) (the
“Shelf”). The Company shall use its commercially reasonable efforts to cause
such Shelf to become effective as promptly thereafter as practicable, but in any
event not later than 90 days after the Filing Deadline if the Company receives
comments to the Shelf from the Commission (“SEC Comments”) or 30 days after the
Filing Deadline if the Company does not receive SEC Comments (such date, the
“Effectiveness Deadline”). The Company’s obligations to file and to cause the
Shelf to become effective pursuant to this Section 1(a) may be suspended for a
period of time, upon written notice to the Holders of Registrable Securities,
(each such period of time, a “Pre-Effective Suspension Period”), if the Company
determines in its reasonable good faith judgment that it is in an Acquisition
Event Period; provided, that (i) there are no more than two Pre-Effective
Suspension Periods during the term of this Agreement, (ii) the duration of any
one Pre-Effective Suspension Period may not exceed 45 days and (iii) the Company
shall use its reasonable good faith efforts to terminate any Pre-Effective
Suspension Period and commence filing or seek effectiveness of the Shelf, as
applicable, as promptly as reasonably practicable, unless the Company, in its
sole discretion, reasonably expects such commencement of filing or seeking
effectiveness would have an adverse effect on the Company with respect to any
proposal or plan of the Company to effect a merger, acquisition, disposition,
financing, reorganization, recapitalization or similar transaction or any
negotiations, discussions or pending proposals with respect thereto. Subject to
any SEC Comments, such Shelf shall include a plan of distribution substantially
in the form attached hereto as Exhibit A (the “Plan of Distribution”), as may be
amended in accordance with the terms of this Agreement. Such Shelf shall not
include any shares of Common Stock, other than the Piggyback Shares, or other
securities for the account of any holder other than the Holders, without the
prior written consent of the Holders of a majority of the Registrable
Securities. The Company shall give written notice of the expected filing of the
Shelf (the “Registration Notice”) at least ten Business Days prior to the filing
thereof to each Holder and the Company shall include in the Shelf all
Registrable Securities with respect to which the Company has received written
requests for inclusion therein at least five Business Days prior to the date of
filing indicated in the Registration Notice; provided, however, that, in order
to be named as a selling securityholder in the Shelf, each Holder must furnish
to the Company a duly completed questionnaire in the form attached to this
Agreement as Exhibit B or in a form mutually acceptable to the parties, and any
additional information as may be reasonably requested by the Company for the
purpose of including such Holder’s Registrable Securities in the Shelf (the
“Selling Holder Information”). The Company shall include, in the Shelf, Selling
Holder Information received to the extent necessary and in a manner so that,
upon effectiveness of the Shelf, any such Holder shall be named, to the extent
required by the rules promulgated under the Securities Act by the Commission, as
a selling securityholder and be permitted to deliver (or be deemed to deliver) a
Prospectus relating to the Shelf to purchasers of the Registrable Securities in
accordance with applicable law.

 

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(b)          Amendments; Shelf Term. If the Company files an amended version of
the Shelf, including any post-effective amendment to the Shelf (the “Shelf
Amendment”), the Company shall give written notice of such Shelf Amendment (the
“Shelf Amendment Notice”) at least ten Business Days prior to the filing thereof
to each Holder and each Holder may be required, upon the Company’s request, to
provide updated Selling Holder Information, in writing, in the form included
with the Company’s Shelf Amendment Notice. The Company shall include in such
Shelf Amendment, such updated Selling Holder Information, including any Selling
Holder Information that was not included in any previously filed version of the
Shelf. Notwithstanding the foregoing, the Company shall not include any Holder’s
Selling Holder Information on a Shelf Amendment to the extent that such Holder,
at the time of the Shelf Amendment Notice, does not or, at the time of the Shelf
Amendment filing, will not, hold Registrable Securities. The Company shall use
its commercially reasonable efforts to convert any Shelf that is on Form S-1 to
a Registration Statement on Form S-3 (the “Form S-3 Shelf”) as soon as
reasonably practicable after the Company is eligible to use Form S-3. The
Company shall use its commercially reasonable efforts to maintain the
effectiveness of the Shelf in accordance with the terms hereof for a period
(such period, the “Shelf Term”) ending upon the earliest to occur of: (i) the
date on which all Registrable Securities covered by the Shelf have been sold,
(ii) the date on which no Holder hereunder holds Registrable Securities, or
(iii) one year from the closing date of the PIPE Transaction (the “Closing
Date”).

 

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(c)          Liquidated Damages. If a Shelf covering the Registrable Securities
is not filed with the Commission on or prior to the Filing Deadline or the
Company fails to have a Registration Statement declared effective under the
Securities Act prior to the applicable Effectiveness Deadline, subject, in each
case, to extension through the Company’s use of any Pre-Effective Suspension
Period as provided in Section 1(a) hereof, for more than 30 consecutive calendar
days (such 30-day period, the “Grace Period”), the Company will, subject to the
conditions set forth in this Section 1(c), make pro rata payments to each
Holder, as liquidated damages and not as a penalty, in an amount equal to 1.5%
of the aggregate amount invested by such Holder pursuant to the Purchase
Agreement (or the purchase price of the Registrable Securities purchased by any
Holder not an original party to the Purchase Agreement, (the “Purchase Amount”)
for each 30-day period (or pro rata for any portion thereof) following the
applicable Grace Period. Such payments shall constitute the Holders’ exclusive
monetary remedy for such events, but shall not affect the right of the Holders
to seek injunctive relief. Such payments shall be made to each Holder by check
mailed to the address of the registered Holder of the Registrable Securities on
the books and records of the Company as maintained by the Company’s transfer
agent, no later than three Business Days after the end of each 30-day period.
Notwithstanding the forgoing, (i) the maximum aggregate liquidated damages
payable to a Holder under this Agreement, including any interest, shall be 10.0%
of the aggregate Purchase Amount paid by such Holder, (ii) no liquidated damages
shall accrue or become payable in respect of any Piggyback Shares, (iii) no
liquidated damages shall accrue or become payable during the Grace Period, (iv)
no liquidated damages shall accrue after the Shelf Term, (v) no liquidated
damages shall accrue during any Acquisition Event Period (as defined below) and
(vi) no liquidated damages shall accrue after the date the shares of Common
Stock then held by such Holder are no longer Registrable Securities.

 

(d)          Restrictions on Use of the Registration Statement. Upon written
notice to the Holders of Registrable Securities, the Company shall be entitled
to suspend, for a period of time (each, a “Suspension Period”), the use of any
Registration Statement or Prospectus and shall not be required to amend or
supplement the Registration Statement, any related Prospectus or any document
incorporated therein by reference if the Company determines in its reasonable
good faith judgment that the Registration Statement or any Prospectus may
contain an untrue statement of a material fact or may omit any fact necessary to
make the statements in the Registration Statement or Prospectus not misleading,
including, but not limited to, situations in which financial statements may be
required for recent or probable acquisitions by the Company; provided, that (i)
there are no more than four Suspension Periods during the Shelf Term, (ii) the
duration of any one Suspension Period may not exceed 30 days, (iii) the duration
of all Suspension Periods during the Shelf Term may not exceed 90 days and (iv)
the Company shall use its reasonable good faith efforts to amend the
Registration Statement and/or Prospectus to correct such untrue statement or
omission as promptly as reasonably practicable, unless the Company, in its sole
discretion, reasonably expects such amendment would have an adverse effect on
the Company with respect to any proposal or plan of the Company to effect a
merger, acquisition, disposition, financing, reorganization, recapitalization or
similar transaction or any negotiations, discussions or pending proposals with
respect thereto.

 

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(e)          Rule 415; Cutback. If at any time the Commission takes the position
that the offering of some or all of the Registrable Securities in a Registration
Statement is not eligible to be made on a delayed or continuous basis under the
provisions of Rule 415 under the Securities Act or requires any Holder to be
named as an “underwriter,” the Company shall use its commercially reasonable
efforts to persuade the Commission that the offering contemplated by the
Registration Statement is a valid secondary offering and not an offering “by or
on behalf of the issuer” as defined in Rule 415 and that the Investor is not an
“underwriter.” The Holders shall have the right to comment or have their counsel
comment on any written submission made to the Commission with respect thereto.
No such written submission shall be made to the Commission to which the Holders’
counsel reasonably objects. In the event that, despite the Company’s
commercially reasonable efforts and compliance with the terms of this Section
1(e), the Commission refuses to alter its position, the Company shall (i) remove
from the Registration Statement such portion of the Registrable Securities,
which for the avoidance of doubt shall include the Piggyback Shares (the “Cut
Back Shares”) and/or (ii) agree to such restrictions and limitations on the
registration and resale of the Registrable Securities as the Commission may
require to assure the Company’s compliance with the requirements of Rule 415
(collectively, the “SEC Restrictions”); provided, however, that the Company
shall not agree to name any Holder as an “underwriter” in such Registration
Statement without the prior written consent of such Holder. Any cut-back imposed
on the Investor pursuant to this Section 1(e) shall be allocated among the
Holders and each of the other parties named as selling stockholders on the
Shelf, including the other investors in the PIPE Transaction and holders of the
Piggyback Shares (collectively, the “Shelf Selling Stockholders”), on a pro rata
basis, unless the SEC Restrictions otherwise require or provide or the Shelf
Selling Stockholders otherwise agree.

 

Section 2. Holdback Agreements. In connection with any underwritten public
offering of equity securities by the Company (a “Company Underwritten
Offering”), if requested by the managing underwriter for such offering, each
Holder agrees to enter into a lock-up agreement containing customary
restrictions on transfers of equity securities of the Company or any securities
convertible into or exchangeable or exercisable for such securities, without
prior written consent from the Company, during the seven day period prior to and
the 90 day period after (or such shorter period as requested) beginning on the
date of pricing of such underwritten offering (subject to extension in
connection with any earnings release or other release of material information
pursuant to FINRA Rule 2711(f) to the extent applicable) (the “Lock-Up Period”);
provided, that nothing herein will prevent (i)(a) any Holder that is a
partnership, limited liability company or corporation from making a distribution
of Registrable Securities to the partners, members or stockholders thereof, (b)
the transfer by a Holder that is an investment advisor managing a separately
managed account to the owner of the separately managed account, or (c) a
transfer to an Affiliate that is otherwise in compliance with the applicable
securities laws, so long as such distributees or transferees agree to be bound
by the restrictions set forth in this Section 2, (ii) the exercise, exchange or
conversion of any security exercisable or exchangeable for, or convertible into,
Common Stock, provided the Common Stock issued upon such exercise or conversion
shall be subject to the restrictions set forth in this Section 2, or (iii) any
Holder from continuing market-making or other trading activities as a
broker-dealer in the ordinary course of business; provided, further, that there
shall be a period of at least 30 days between the end of any Lock-Up Period and
the pricing date of any subsequent Company Underwritten Offering. If requested
by the managing underwriter, each Holder agrees to execute a lock-up agreement
in favor of the Company’s underwriters to such effect and, in any event, that
the Company’s underwriters in any relevant underwritten offering shall be third
party beneficiaries of this Section 2. The provisions of this Section 2 will no
longer apply to a Holder once such Holder ceases to hold Registrable Securities.

 

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Section 3. Company Undertakings.

 

In connection with the Company’s registration obligations hereunder, the Company
shall, as expeditiously as possible:

 

(a)          before filing a Registration Statement or Prospectus, any
amendments or supplements thereto or any Issuer Free Writing Prospectus, at the
Company’s expense, furnish to Counsel to the Holders, if any, copies of all such
documents, other than documents that are incorporated by reference, proposed to
be filed and such other documents reasonably requested by the Holders and
provide a reasonable opportunity for review and comment on such documents by
Counsel to the Holders;

 

(b)          notify each Holder of Registrable Securities of the effectiveness
of the Registration Statement and 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 keep such Registration
Statement effective until the date on which all Registrable Securities have been
sold pursuant to the Registration Statement or have otherwise ceased to be
Registrable Securities, and comply with the provisions of the Securities Act
with respect to the disposition of all securities covered by such Registration
Statement during such period in accordance with the intended methods of
disposition by the sellers thereof set forth in such Registration Statement;
provided, however in no event shall the Company be obligated to maintain the
effectiveness of the Registration Statement beyond the Shelf Term and further
provided, that the Company’s obligations under this Section 3(b) shall not apply
during any Suspension Period;

 

(c)          furnish to each Holder of Registrable Securities, without charge,
such number of copies of the applicable Registration Statement, each amendment
and supplement thereto, the Prospectus included in such Registration Statement
(including any Prospectus (including any Prospectus filed under Rule 424 and any
Issuer Free Writing Prospectus)), all exhibits and other documents filed
therewith and such other documents as such seller may reasonably request
including in order to facilitate the disposition of the Registrable Securities
owned by such seller, and upon request, a copy of any and all transmittal
letters or other correspondence to or received from, the Commission or any other
governmental authority relating to such offer;

 

(d)          (i) register or qualify such Registrable Securities under such
other securities or blue sky laws of such jurisdictions as any Holder reasonably
requests, (ii) keep such registration or qualification in effect for so long as
the applicable Registration Statement remains in effect and (iii) use its
commercially reasonable efforts to do any and all other acts and things which
may be reasonably necessary or advisable to enable such Holder to consummate the
disposition in such jurisdictions of the Registrable Securities owned by such
seller in a manner substantially similar to those set forth in the Plan of
Distribution (provided, that nothing contained herein or in the Plan of
Distribution shall require the Company to (w) qualify generally to do business
in any jurisdiction where it would not otherwise be required to qualify but for
this subsection, (x) subject itself to taxation in any such jurisdiction, (y)
consent to general service of process in any such jurisdiction or (z)
participate in or effect any underwritten offering on behalf of or for the
Holders of Registrable Securities;

 

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(e)          notify each Holder of such Registrable Securities (i) at any time
when a Prospectus relating to the applicable Registration Statement is required
to be delivered under the Securities Act, (A) promptly upon discovery that, or
upon the happening of any event as a result of which, such Registration
Statement, or the Prospectus or Free Writing Prospectus relating to such
Registration Statement, or any document incorporated or deemed to be
incorporated therein by reference contains an untrue statement of a material
fact or omits any fact necessary to make the statements in the Registration
Statement or the Prospectus or Free Writing Prospectus relating thereto not
misleading or otherwise requires the making of any changes in such Registration
Statement, Prospectus, Free Writing Prospectus or document, and, at the request
of any such seller and, the Company shall promptly prepare a supplement or
amendment to such Prospectus or Free Writing Prospectus, furnish a reasonable
number of copies of such supplement or amendment to each seller of such
Registrable Securities and file such supplement or amendment with the Commission
so that, as thereafter delivered to the purchasers of such Registrable
Securities, such Prospectus or Free Writing Prospectus as so amended or
supplemented shall not contain an untrue statement of a material fact or omit to
state any fact necessary to make the statements therein not misleading, (B)
promptly if the Company becomes aware of any request by the Commission or any
federal or state governmental authority for amendments or supplements to a
Registration Statement or related Prospectus or Free Writing Prospectus covering
Registrable Securities or for additional information relating thereto, (C)
promptly if the Company becomes aware of the issuance or threatened issuance by
the Commission of any stop order or other order suspending or threatening to
suspend the effectiveness or preventing the use of a Registration Statement
covering the Registrable Securities or suspending the qualification of any
Registrable Securities included in such Registration Statement (and use its
commercially reasonable efforts to prevent the issuance of or obtain the lifting
of any such stop order or obtain the withdrawal of any order suspending or
preventing the use of any related Prospectus or Free Writing Prospectus or
suspending qualification of any Registrable Securities included in the
Registration Statement as soon as reasonably practicable) or (D) promptly upon
the receipt by the Company of any notification with respect to the suspension of
the qualification or exemption from qualification of any Registrable Securities
for sale in any jurisdiction, or the initiation or threatening of any proceeding
for such purpose; and (ii) when each such Registration Statement or any
amendment thereto has been filed with the Commission and when each Registration
Statement or the related Prospectus or Free Writing Prospectus or any Prospectus
supplement or any post-effective amendment thereto has become effective;

 

(f)          use its commercially reasonable efforts to cause all Registrable
Securities covered by a Shelf to be listed on each securities exchange,
interdealer quotation system or other market on which similar securities issued
by the Company are then listed;

 

(g)          provide and cause to be maintained a transfer agent and registrar
for all such Registrable Securities no later than the effective date of the
applicable Registration Statement;

 

(h)          permit any Holder of Registrable Securities, to participate
(including, but not limited to, reviewing and commenting) in the preparation of
such Registration Statement;

 

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(i)          with respect to each Free Writing Prospectus or other materials to
be included in the Disclosure Package, ensure that no Registrable Securities be
sold “by means of” (as defined in Rule 159A(b) promulgated under the Securities
Act) such Free Writing Prospectus or other materials without the prior written
consent of the Holders of a majority of the Registrable Securities that are
being sold pursuant to such Free Writing Prospectus, which Free Writing
Prospectuses or other materials shall be subject to the review of Counsel to the
Holders; provided, however, the Company shall not be responsible or liable for
any breach by a Holder that has not obtained the prior written consent of the
Company pursuant to Section 12(o);

 

(j)          promptly notify in writing the Holders and the sales or placement
agent, if any, therefor, (i) when such Registration Statement or related
Prospectus or Free Writing Prospectus or any Prospectus amendment or supplement
or post-effective amendment has been filed, and, with respect to any such
Registration Statement or any post-effective amendment, when the same has become
effective and (ii) of any written comments by the Commission and by the blue sky
or securities commissioner or regulator of any state with respect thereto;

 

(k)          (i) prepare and file with the Commission such amendments and
supplements to each Registration Statement as may be necessary to comply with
the provisions of the Securities Act, including post-effective amendments to
each Registration Statement as may be necessary to keep such Registration
Statement continuously effective for the applicable time period required
hereunder; (ii) cause the related Prospectus to be supplemented by any required
Prospectus supplement, and as so supplemented to be filed pursuant to Rule 424
(or any similar provisions then in force) promulgated under the Securities Act;
(iii) comply with the provisions of the Securities Act and the Exchange Act and
any applicable securities exchange or other recognized trading market with
respect to the disposition of all securities covered by such Registration
Statement during such period in accordance with the intended methods of
disposition by the sellers thereof set forth in such Registration Statement as
so amended or in such Prospectus as so supplemented; and (iv) provide additional
information related to each Registration Statement as requested by, and obtain
any required approval necessary from, the Commission or any federal or state
governmental authority;

 

(l)          within the deadlines specified by the Securities Act, make all
required filing fee payments in respect of any Registration Statement or
Prospectus used under this Agreement (and any offering covered thereby);

 

(m)          use its commercially reasonable efforts to take all other actions
necessary or customarily taken by issuers to effect the registration of and its
commercially reasonable efforts to take all other actions necessary to effect
the sale of, the Registrable Securities contemplated hereby.

 

Section 4. Registration Expenses.All Registration Expenses shall be borne by the
Company. All Selling Expenses relating to Registrable Securities registered
shall be borne by the Holders of such Registrable Securities pro rata on the
basis of the number of Registrable Securities sold.

 

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Section 5. Indemnification; Responsibility; Contribution.    The Company agrees
to indemnify and hold harmless each Holder of Registrable Securities, its
officers, directors, members, partners, agents and employees and each Person who
controls any such Holder within the meaning of either the Securities Act or the
Exchange Act, to the fullest extent permitted by applicable law, from and
against any and all losses, claims, damages, liabilities, expenses and actions
to which they or any of them may become subject insofar as such losses, claims,
damages, liabilities and expenses (or actions in respect thereof) arise out of
or are based upon any untrue statement or alleged untrue statement of a material
fact contained in a Registration Statement, the Disclosure Package, or any
preliminary, final or summary Prospectus or Free Writing Prospectus included in
any such Registration Statement, or in any amendment thereof or supplement
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 (in the case of the Disclosure Package, or any
preliminary, final or summary Prospectus or Free Writing Prospectus included in
any such Registration Statement (in light of the circumstances under which they
were made) not misleading, and agrees to reimburse each such indemnified party,
as incurred, for any legal or other expenses reasonably incurred by them in
connection with investigating or defending any such loss, claim, damage,
liability, expense or action (whether or not the indemnified party is a party to
any proceeding); provided, however, that the Company will not be liable in any
case to the extent that any such loss, claim, damage, liability or expense
arises (i) out of or is based upon any such untrue statement or alleged untrue
statement or omission or alleged omission made therein in reliance upon and in
conformity with written information furnished to the Company by or on behalf of
any such Holder specifically for inclusion therein including, without
limitation, any notice and questionnaire (including, for the avoidance of doubt,
Exhibit B hereto), or (ii) out of sales of Registrable Securities made during a
Pre-Effective Suspension Period or a Suspension Period after notice is given
pursuant to Section 1(a) and Section 1(d) hereof, respectively. This indemnity
clause will be in addition to any liability which the Company may otherwise
have.

 

(b)          Each Holder (except the Investor), severally (and not jointly)
agrees to indemnify and hold harmless the Company and each of its officers,
directors, members, partners, agents and employees and each Person who controls
the Company within the meaning of either the Securities Act or the Exchange Act,
to the fullest extent permitted by applicable law, from and against any and all
losses, claims, damages or liabilities to which they or any of them may become
subject insofar as such losses, claims, damages or liabilities arise out of or
are based upon any untrue statement or alleged untrue statement of a material
fact contained in a Registration Statement, in the Disclosure Package or any
Holder Free Writing Prospectus, preliminary, final or summary Prospectus
included in any such Registration Statement, or in any amendment thereof or
supplement 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 (in the case of the Disclosure Package,
or any preliminary, final or summary Prospectus or Free Writing Prospectus
included in any such Registration Statement, in light of the circumstances under
which they were made) not misleading, to the extent, but only to the extent,
that any such untrue statement or alleged untrue statement or omission or
alleged omission is contained in any written information relating to such Holder
furnished to the Company by or on behalf of such Holder specifically for
inclusion therein; provided, however, that the total amount to be indemnified by
such Holder pursuant to this Section 5(b) shall be limited to the net proceeds
received by such Holder in the offering to which such Registration Statement,
Disclosure Package, Prospectus or Holder Free Writing Prospectus relates. This
indemnity clause will be in addition to any liability which any such Holder may
otherwise have. For the avoidance of doubt, the Investor shall not be subject to
the terms of this Section 5(b).

 

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(c)          The Investor agrees that it shall be responsible for any and all
written information relating to itself furnished to the Company by or on behalf
of itself specifically for inclusion in the Shelf and that such information will
be true and correct in all material respects.

 

(d)          Promptly after receipt by an indemnified party under this Section 5
of notice of the commencement of any action, such indemnified party will, if a
claim in respect thereof is to be made against the indemnifying party under this
Section 5, notify the indemnifying party in writing of the commencement thereof;
but the failure so to notify the indemnifying party (i) will not relieve it from
liability under paragraphs (a) or (b) above unless and to the extent such action
and such failure results in material prejudice to the indemnifying party and
forfeiture by the indemnifying party of substantial rights and defenses; and
(ii) will not, in any event, relieve the indemnifying party from any obligations
to any indemnified party other than the indemnification obligation provided in
paragraphs (a) or (b) above. The indemnifying party shall be entitled to
participate therein and, to the extent that it shall wish, jointly with any
other indemnifying party similarly notified, to assume the defense thereof, with
counsel reasonably satisfactory to such indemnified party, and, except as
provided in the next sentence, after notice from the indemnifying party to such
indemnified party of its election to so assume the defense thereof, the
indemnifying party shall not be liable to such indemnified party for any legal
expenses of other counsel or any other expenses subsequently incurred by such
indemnified party in connection with the defense thereof. Notwithstanding the
indemnifying party’s rights in the prior sentence, the indemnified party shall
have the right to employ its own counsel (and one local counsel), but the
indemnified party shall bear the reasonable fees, costs and expenses of such
separate counsel. No indemnifying party shall, in connection with any one action
or separate but substantially similar or related actions in the same
jurisdiction arising out of the same general circumstances or allegations, be
liable for the fees and expenses of more than one separate firm of attorneys (in
addition to any local counsel) for all indemnified parties unless the use of
only one firm of attorneys would be inappropriate due to a conflict of interest
in the reasonable judgment of the indemnified party. An indemnifying party shall
not be liable under this Section 5 to any indemnified party regarding any
settlement or compromise or consent to the entry of any judgment with respect to
any pending or threatened claim, action, suit or proceeding in respect of which
indemnification or contribution may be sought hereunder (whether or not the
indemnified parties are actual or potential parties to such claim or action)
unless such settlement, compromise or consent is consented to in writing by such
indemnifying party. No indemnifying party, in the defense of any such claim or
litigation, shall, except with the consent of each indemnified party, consent to
entry of any judgment or enter into any settlement or compromise if any pending
or threatened proceeding in respect of which any indemnified party is or could
have been a party and indemnity could have been sought hereunder by such
indemnified party, unless such settlement or compromise includes an
unconditional release of such indemnified party from all liability on claims
that are the subject matter of such proceeding.

 

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(e)          In the event that the indemnity provided in Section 5(a) or Section
5(b) above is held by a court of competent jurisdiction to be unavailable to or
insufficient to hold harmless an indemnified party with respect to any loss,
claim, damage, liability, expense or action referred to herein, then each
applicable indemnifying party agrees to contribute to the aggregate losses,
claims, damages and liabilities (including, without limitation, legal or other
expenses reasonably incurred in connection with investigating or defending same)
(collectively, “Losses”) to which such indemnifying party may be subject in such
proportion as is appropriate to reflect the relative benefits received from the
offering of the Common Stock, as applicable, and relative fault of the
indemnifying party on the one hand and the indemnified party on the other in
connection with the statements or omissions which resulted in such losses,
claims, damages or liabilities (or actions in respect thereof), as well as any
other relevant equitable considerations. The relative fault shall be determined
by reference to, among other things, whether the untrue or alleged untrue
statement of a material fact or the omission or alleged omission to state a
material fact relates to information supplied by the indemnifying party on the
one hand or the indemnified party on the other and the parties’ relative intent,
knowledge, access to information and opportunity to correct or prevent such
statement or omission. The parties agree that it would not be just and equitable
if contribution pursuant to this Section 5(e) were determined by pro rata
allocation (even if the Holders of Registrable Securities or any agents or all
of them were treated as one entity for such purpose) or by any other method of
allocation which does not take account of the equitable considerations referred
to above in this Section 5(e). The amount paid or payable by an indemnified
party as a result of the losses, claims, damages or liabilities (or actions in
respect thereof) referred to above in this Section 5(e) shall be deemed to
include any legal or other expenses reasonably incurred by such indemnified
party in connection with investigating or defending any such action or claim.
Notwithstanding the provisions of this Section 5(e), no Person guilty of fraud
or 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 fraud or fraudulent misrepresentation. For purposes of this
Section 5, each Person who controls any Holder of Registrable Securities, agent
or underwriter within the meaning of either the Securities Act or the Exchange
Act and each director, officer, employee and agent of any such Holder, agent or
underwriter shall have the same rights to contribution as such Holder, agent or
underwriter, and each Person who controls the Company within the meaning of
either the Securities Act or the Exchange Act and each officer and director of
the Company shall have the same rights to contribution as the Company, subject
in each case to the applicable terms and conditions of this Section 5(e).

 

(f)          The provisions of this Section 5 will remain in full force and
effect, regardless of any investigation made by or on behalf of any Holder of
Registrable Securities or the Company or any of the officers, directors,
members, partners, agents and employees or controlling Persons referred to in
this Section 5, and will survive the transfer of Registrable Securities.

 

Section 6. Sale of Registrable Securities. It shall be a condition precedent to
the obligations of the Company to include Registrable Securities of any Holder
in any Registration Statement or Prospectus, as the case may be, that such
Holder shall timely furnish to the Company (as a condition precedent to such
Holder’s participation in such registration) its Selling Holder Information in
accordance with the terms hereof. Each selling Holder shall timely provide the
Company with such information as may be reasonably requested to enable the
Company to prepare a supplement or post-effective amendment to any Shelf
Registration or a supplement to any Prospectus relating to such Shelf
Registration.

 

10

 

 

Section 7. Private Sale and Legends.

 

(a)          Except as provided in Section 2 hereof, the Company agrees that
nothing in this Agreement shall prohibit the Holders, at any time and from time
to time, from selling or otherwise transferring Registrable Securities pursuant
to a private sale or other transaction which is compliant with and not
registered pursuant to the Securities Act.

 

(b)          The Holders acknowledge that the certificate, general statement or
other such instruments representing the Registrable Securities shall bear any
legend as required by the “blue sky” laws of any state and a restrictive legend
in substantially the following form (and a stop-transfer order may be placed
against transfer of such stock certificates or general statements):

 

THE SECURITIES REPRESENTED HEREBY HAVE NOT BEEN REGISTERED UNDER THE UNITED
STATES SECURITIES ACT OF 1933, AS AMENDED (THE “SECURITIES ACT”), OR ANY STATE
SECURITIES LAWS. THE HOLDER HEREOF, BY PURCHASING SUCH SECURITIES, AGREES FOR
THE BENEFIT OF THE ISSUER THAT THESE SECURITIES MAY BE OFFERED, SOLD OR
OTHERWISE TRANSFERRED ONLY (A) TO THE ISSUER, (B) PURSUANT TO REGISTRATION UNDER
THE SECURITIES ACT, (C) OUTSIDE THE UNITED STATES PURSUANT TO REGULATION S UNDER
THE SECURITIES ACT, (D) INSIDE THE UNITED STATES PURSUANT TO THE EXEMPTION FROM
REGISTRATION UNDER THE SECURITIES ACT PROVIDED BY RULE 144 THEREUNDER, IF
AVAILABLE, OR (E) IN A TRANSACTION THAT IS OTHERWISE EXEMPT FROM THE
REGISTRATION REQUIREMENTS OF THE SECURITIES ACT, AND IN EACH CASE IN COMPLIANCE
WITH APPLICABLE STATE SECURITIES LAWS AND THE APPLICABLE LAWS OF ANY OTHER
JURISDICTION, PROVIDED THAT IN THE CASE OF (C), (D) or (E) ABOVE, THE HOLDER
HAS, PRIOR TO SUCH SALE, FURNISHED TO THE ISSUER A LEGAL OPINION OF COUNSEL OF
RECOGNIZED STANDING, REASONABLY SATISFACTORY TO THE ISSUER. HEDGING TRANSACTIONS
INVOLVING THESE SECURITIES MAY NOT BE CONDUCTED UNLESS IN COMPLIANCE WITH THE
SECURITIES ACT.”

 

Section 8. Rule 144 and Rule 144A.With a view to making available to the Holders
of Registrable Securities the benefits of Rule 144 and Rule 144A promulgated
under the Securities Act (“Rule 144” and “Rule 144A”) and other rules and
regulations of the Commission that may at any time permit a Holder of
Registrable Securities to sell securities of the Company to the public without
registration, the Company covenants that it will (i) use its commercially
reasonable efforts to file in a timely manner all reports and other documents
required, if any, to be filed by it under the Securities Act and the Exchange
Act and the rules and regulations adopted thereunder and (ii) make available
information necessary to comply with Rule 144 and Rule 144A, if available with
respect to resales of the Registrable Securities under the Securities Act, at
all times, all to the extent required from time to time to enable such Holder to
sell Registrable Securities without registration under the Securities Act within
the limitation of the exemptions provided by (x) Rule 144 and Rule 144A
promulgated under the Securities Act (if available with respect to resales of
the Registrable Securities), as such rules may be amended from time to time or
(y) any other rules or regulations now existing or hereafter adopted by the
Commission.

 

11

 

 

Section 9. Transfer of Registration Rights.The rights of a Holder hereunder may
be transferred, assigned, or otherwise conveyed on a pro rata basis in
connection with any transfer, assignment, or other conveyance of Registrable
Securities (other than the Piggyback Shares) to any transferee or assignee;
provided that all of the following additional conditions are satisfied: (a) such
transfer or assignment is effected in accordance with applicable securities
laws; (b) such transferee or assignee agrees in writing to become subject to the
terms of this Agreement by delivering to the Company a duly executed joinder
agreement; and (c) the Company is given written notice by such Holder of such
transfer or assignment, stating the name and address of the transferee or
assignee and identifying the Registrable Securities with respect to which such
rights are being transferred or assigned. For the avoidance of doubt, the rights
of a Holder of Piggyback Shares shall not be transferable with respect to any
transfer of Piggyback Shares.

 

Section 10. Joinder.

 

Any Person who demonstrates that it is a Holder of Registrable Securities as of
the date of the Registration Notice may acquire the rights of a Holder hereunder
if it agrees in writing to become subject to the terms of this Agreement as a
Holder by delivering to the Company a duly executed joinder agreement in form
attached hereto as Exhibit C.

 

Section 11. Amendment, Modification and Waivers.

 

(a)          Amendment. The provisions of this Agreement, including the
provisions of this sentence, may not be amended, modified or supplemented, and
waivers or consents to or departures from the provisions hereof may not be
given, without the written consent of the Company and the Holder or Holders of a
majority of the Registrable Securities. In the event of such amendment,
modification or waiver, the Company shall use its commercially reasonable
efforts to provide prompt written notice to the Investor of such amendment,
modification or waiver. Notwithstanding the foregoing, Section 5 and Section
12(g) as relates to the Investor and Sections 12(a), 12(j) and 12(s) may not be
amended, modified or supplemented, and waivers or consents to or departures from
the provisions thereof may not be given, without the written consent of the
Investor.

 

(b)          Effect of Waiver. No waiver of any terms or conditions of this
Agreement shall operate as a waiver of any other breach of such terms and
conditions or any other term or condition, nor shall any failure of any party to
enforce any provision hereof operate or be construed as a waiver of such
provision or of any other provision hereof and shall not affect the right of
such party thereafter to enforce each provision of this Agreement in accordance
with its terms. No written waiver hereunder, unless it by its own terms
explicitly provides to the contrary, shall be construed to effect a continuing
waiver of the provisions being waived and no such waiver in any instance shall
constitute a waiver in any other instance or for any other purpose or impair the
right of the party against whom such waiver is claimed in all other instances or
for all other purposes to require full compliance with such provision.

 

12

 

 

Section 12. Miscellaneous; Remedies; Specific Performance.

 

(a)          Specific Performance. Any Person having rights under any provision
of this Agreement shall be entitled to seek to enforce such rights specifically,
to recover damages caused by reason of any breach of any provision of this
Agreement and to exercise all other rights existing in their favor. The parties
hereto agree and acknowledge that money damages may not be an adequate remedy
for any breach of the provisions of this Agreement and that any party may in its
sole discretion apply to any court of law or equity of competent jurisdiction
for specific performance and/or injunctive relief (without posting any bond or
other security) in order to enforce or prevent violation of the provisions of
this Agreement. The parties hereto further agree and acknowledge that each and
every obligation applicable to it contained in this Agreement may be
specifically enforceable against it. All rights and remedies existing under this
Agreement are cumulative to, and not exclusive of, any rights or remedies
available under this Agreement or otherwise.

 

(b)          Successors and Assigns. This Agreement shall be binding upon and
inure to the benefit of the parties hereto and their respective successors and
assigns; provided, that no party shall assign any of its rights or obligations
hereunder without the prior written consent of the other party, except that the
right to cause the Company to register Registrable Securities hereunder may be
assigned (but only with all related obligations) by a Holder, in compliance with
all applicable securities laws, to a transferee who acquires all or any part of
such Holder’s Registrable Securities from the Holder, as long as such transferee
agrees in writing to be bound by the provisions of this Agreement.

 

(c)          Severability. Whenever possible, each provision of this Agreement
shall be interpreted in such manner as to be effective and valid under
applicable law, but if any provision of this Agreement is held to be prohibited
by or invalid under applicable law, such provision shall be ineffective only to
the extent of such prohibition or invalidity, without prohibiting or
invalidating the remainder of this Agreement.

 

(d)          Counterparts. This Agreement may be executed simultaneously in two
or more counterparts, any one of which need not contain the signatures of more
than one party, but all such counterparts taken together shall constitute one
and the same Agreement.

 

(e)          Descriptive Headings; Interpretation; No Strict Construction. The
descriptive headings of this Agreement are inserted for convenience only and do
not constitute a substantive part of this Agreement. Whenever required by the
context, any pronoun used in this Agreement shall include the corresponding
masculine, feminine or neuter forms, and the singular forms of nouns, pronouns,
and verbs shall include the plural and vice versa. Reference to any agreement,
document, or instrument means such agreement, document, or instrument as amended
or otherwise modified from time to time in accordance with the terms thereof,
and, if applicable, hereof. The words “include,” “includes” or “including” in
this Agreement shall be deemed to be followed by “without limitation.” The use
of the words “or,” “either” or “any” shall not be exclusive. The parties hereto
have participated jointly in the negotiation and drafting of this Agreement. If
an ambiguity or question of intent or interpretation arises, this Agreement
shall be construed as if drafted jointly by the parties hereto, and no
presumption or burden of proof shall arise favoring or disfavoring any party by
virtue of the authorship of any of the provisions of this Agreement. All
references to laws, rules, regulations and forms in this Agreement shall be
deemed to be references to such laws, rules, regulations and forms, as amended
from time to time or, to the extent replaced, the comparable successor thereto
in effect at the time. All references to agencies, self-regulatory organizations
or governmental entities in this Agreement shall be deemed to be references to
the comparable successors thereto from time to time.

 

13

 

 

(f)          Governing Law. This Agreement and the exhibits and schedules hereto
shall be governed by, and construed in accordance with, the laws of the State of
New Jersey, without giving effect to any choice of law or conflict of law rules
or provisions (whether of the State of New Jersey or any other jurisdiction) to
the extent such rules or provisions would cause the application of the laws of
any jurisdiction other than the State of New Jersey.

 

(g)          Notices. All notices, demands or other communications to be given
or delivered under or by reason of the provisions of this Agreement shall be in
writing and shall be deemed to have been given when (a) delivered personally to
the recipient, (b) telecopied or sent by facsimile or e-mail to the recipient,
or (c) one Business Day after being sent to the recipient by reputable overnight
courier service (charges prepaid). Such notices, demands and other
communications shall be sent to the Company at the address set forth below and
to any Holder of Registrable Securities at the address set forth on the
signature page hereto, or at such address or to the attention of such other
Person as the recipient party has specified by prior written notice to the
sending party. Notwithstanding anything to the contrary contained herein,
including without limitation Section 12(h) hereof, facsimile shall not be deemed
an effective method of delivery of notices and communications to the Investor.

 

If to the Company:

 

Sequential Brands Group, Inc.

1065 Avenue of the Americas

30th Floor

New York, NY 10018
Attention:   Gary Klein, CFO

 

with copies (which shall not constitute notice) to:

 

White & Case LLP
1155 Avenue of the Americas

New York,  New York 10036
Attention:   Nazim Zilkha

                   David Johansen

 

if to the Transfer Agent:

 

Computershare Trust Company, N.A.

250 Royall Street

Canton, MA 02021
Attention:   General Counsel

 

14

 

 

with copies (which shall not constitute notice) to:

 

Computershare

480 Washington Blvd. 29th Floor

Jersey City, NJ 07310

Attention: David Cruz, Relationship Manager

 

If any time period for giving notice or taking action hereunder expires on a day
that is not a Business Day, the time period shall automatically be extended to
the Business Day immediately following such Saturday, Sunday or legal holiday.

 

(h)          Delivery by Facsimile. This Agreement, the agreements referred to
herein, and each other agreement or instrument entered into in connection
herewith or therewith or contemplated hereby or thereby, and any amendments
hereto or thereto, to the extent signed and delivered by means of a facsimile
machine or other electronic means, shall be treated in all manner and respects
as an original agreement or instrument and shall be considered to have the same
binding legal effect as if it were the original signed version thereof delivered
in person. At the request of any party hereto or to any such agreement or
instrument, each other party hereto or, thereto shall reexecute original forms
thereof and deliver them to all other parties. No party hereto or to any such
agreement or instrument shall raise the use of a facsimile machine or other
electronic means to deliver a signature or the fact that any signature or
agreement or instrument was transmitted or communicated through the use of a
facsimile machine or other electronic means as a defense to the formation or
enforceability of a contract and each such party forever waives any such
defense.

 

(i)          Jury Trial. Each of the parties to this Agreement hereby agrees not
to assert its respective right to a jury trial of any claim or cause of action
based upon or arising out of this Agreement. The scope of this Section 12(i) is
intended to be all-encompassing of any and all disputes that may be filed in any
court and that relate to the subject matter of this Agreement, including
contract claims, tort claims and all other common law and statutory claims. Each
party hereto acknowledges that this Section 12(i) is a material inducement to
enter into this Agreement, that each has already relied on this Section 12(i) in
entering into this Agreement, and that each will continue to rely on this
Section 12(i) in their related future dealings. Each party hereto further
warrants and represents that it has reviewed this Section 12(i) with its legal
counsel and that it knowingly and voluntarily agrees not to assert its jury
trial rights following consultation with legal counsel. THIS SECTION 12(i) IS
IRREVOCABLE, MEANING THAT IT MAY NOT BE MODIFIED EITHER ORALLY OR IN WRITING
(OTHER THAN BY A MUTUAL WRITTEN WAIVER SPECIFICALLY REFERRING TO THIS SECTION
12(i) AND EXECUTED BY EACH OF THE PARTIES HERETO), AND THIS SECTION 12(i) SHALL
APPLY TO ANY SUBSEQUENT AMENDMENTS, RENEWALS, SUPPLEMENTS OR MODIFICATIONS TO
THIS AGREEMENT. In the event of litigation, this Agreement may be filed as a
written consent to a trial by the court.

 

15

 

 

(j)          Submission to Jurisdiction. With respect to any suit, action or
proceeding relating to any offers, purchases or sales of the Securities by the
undersigned (“Proceedings”), the undersigned irrevocably submits to the
exclusive jurisdiction of the trial division of the Superior Court of the State
of New Jersey, and such Proceedings shall be governed by the procedural rules
and laws of the State of New Jersey, without regard to principles of conflicts
of law. The Investor shall not be deemed to have waived any objection it may now
or hereafter have to the laying of jurisdiction or venue or any such Proceedings
in any courts other than the courts of the State of New Jersey, nor deemed to
waive any claim that any such Proceedings brought in any such court has been
brought in a court without jurisdiction or an inconvenient or improper forum.

 

(k)          Arm’s Length Agreement. Each of the parties to this Agreement
agrees and acknowledges that this Agreement has been negotiated in good faith,
at arm’s length, and not by any means prohibited by law.

 

(l)          Sophisticated Parties; Advice of Counsel. Each of the parties to
this Agreement specifically acknowledges that (i) it is a knowledgeable,
informed, sophisticated Person capable of understanding and evaluating the
provisions set forth in this Agreement and (ii) it has been fully advised and
represented by legal counsel of its own independent selection and has relied
wholly upon its independent judgment and the advice of such counsel in
negotiating and entering into this Agreement.

 

(m)          Entire Agreement. This Agreement, together with the schedules and
exhibits attached hereto, and any certificates, documents, instruments and
writings that are delivered pursuant hereto, constitutes the entire agreement
and understanding of the parties in respect of the subject matter hereof and
supersedes all prior understandings, agreements or representations by or among
the parties, written or oral, to the extent they relate in any way to the
subject matter hereof.

 

(n)          Certification. Within 10 Business Days following receipt of a
written request from the Company by any Holder (which request shall not be made
more than twice in any calendar year), such Holder shall certify to the Company
that such Holder continues to hold Registrable Securities (the “Certification”).
If a Holder fails to provide the Certification within the 10 Business Day period
referred to in the immediately preceding sentence, the Company reserves the
right, in its sole discretion, to remove such Holder’s Registrable Securities
from a Registration Statement.

 

(o)          Free Writing Prospectus Consent. No Holder shall use a Holder Free
Writing Prospectus without the prior written consent of the Company, which
consent shall not be unreasonably withheld, conditioned or delayed.

 

(p)          No Required Sale. Nothing in this Agreement shall be deemed to
create an independent obligation on the part of any Holder to sell any
Registrable Securities pursuant to any effective registration statement.

 

(q)          Termination. The obligations of the Company and of any Holder,
other than those obligations contained in Section 5, shall terminate with
respect to the Company and such Holder as soon as such Holder no longer holds
any Registrable Securities.

 

16

 

 

(r)          No Third-Party Beneficiaries or Other Right. Nothing herein shall
grant to or create in any person not a party hereto, or any such person’s
dependents or heirs, any right to any benefits hereunder or any remedies
hereunder, and no such party shall be entitled to sue any party to this
Agreement with respect thereto; provided, however, that the officers, directors,
members, partners, agents and employees of each indemnified party and each
Person who controls any such indemnified party within the meaning of either the
Securities Act or the Exchange Act are intended third-party beneficiaries of
Section 5 and shall have the right, power, and authority to enforce the
provisions thereof as though they were a party hereto.

 

(s)          Sovereign Immunity. The Investor reserves all immunities, defenses,
rights or actions arising out of the Investor’s sovereign and governmental
status or under the Eleventh Amendment to the United States Constitution and the
laws and Constitution of the State of New Jersey, except to the extent waived by
statute. No waiver of any such immunities, defenses, rights or actions shall be
implied or otherwise deemed to exist by reason of the Investor’s entry into this
Agreement, the Purchase Agreement and any other documents or agreements executed
in connection with the transactions contemplated under the Purchase Agreement,
by any express or implied provision hereof, or by any actions or omissions to
act by the Investor. Any claims asserted against the Investor shall be subject
to the New Jersey Contractual Liability Act and the New Jersey Tort Claims Act.

 

Section 13. Definitions.“Affiliate” of any particular Person means any other
Person directly or indirectly controlling, controlled by or under common control
with such particular Person.

 

“Acquisition Event Period” means any period prior to the effective date of the
Shelf during which the Company is pursuing and has not yet completed any
announced or unannounced merger or acquisition transaction in respect to which
the Company has entered into a binding or non-binding letter of intent,
exclusivity letter or other documentation in anticipation of definitive
documentation.

 

“Agreement” has the meaning specified in the first paragraph hereof.

 

“Beneficial Ownership” and terms of similar import shall be as defined under and
determined pursuant to Rule 13d-3 promulgated under the Exchange Act.

 

“Business Day” means each Monday, Tuesday, Wednesday, Thursday and Friday that
is not a day on which banking institutions in New York City are generally
authorized or obligated by law or executive order to close.

 

“Certification” has the meaning specified in Section 12(n).

 

“Closing Date” has the meaning specified in Section 1(b).

 

“Commission” means the United States Securities and Exchange Commission or any
successor governmental agency.

 

“Company” has the meaning specified in the first paragraph hereof.

 

“Company Underwritten Offering” has the meaning specified in Section 2.

 

17

 

 

“Common Stock” means the shares of common stock, par value $0.001 per share, and
any additional shares of such common stock paid, issued or distributed in
respect of any such shares by way of a stock dividend, stock split or
distribution, or in connection with a combination of shares, and any such
security into which such Common Stock shall have been converted or exchanged in
connection with a recapitalization, reorganization, reclassification, merger,
consolidation, exchange, distribution or otherwise.

 

“control” (including the terms “controlling,” “controlled by” and “under common
control with”) means, unless otherwise noted, the possession, directly or
indirectly, of the power to direct or cause the direction of the management and
policies of a Person, whether through the ownership of voting shares, by
contract, or otherwise.

 

“Counsel to the Holders” means, one counsel (and one local counsel) selected
from time to time by the Holders of a majority of the Registrable Securities.

 

“Cut Back Shares” has the meaning specified in Section 1(e).

 

“Disclosure Package” means, with respect to any offering of securities, (i) the
preliminary prospectus, (ii) each Free Writing Prospectus and (iii) all other
information, in each case, that is deemed, under Rule 159 promulgated under the
Securities Act, to have been conveyed to purchasers of securities at the time of
sale of such securities (including a contract of sale).

 

“Effectiveness Deadline” has the meaning specified in Section 1(a).

 

“Exchange Act” means the Securities Exchange Act of 1934, as amended from time
to time.

 

“Filing Deadline” has the meaning specified in Section 1(a).

 

“FINRA” means the Financial Industry Regulatory Authority.

 

“Form S-1” means such form under the Securities Act, as amended from time to
time by the Commission.

 

“Form S-3” means such form under the Securities Act, as amended from time to
time by the Commission.

 

“Form S-3 Shelf” has the meaning specified in Section 1(b).

 

“Free Writing Prospectus” means any “free writing prospectus” as defined in Rule
405 promulgated under the Securities Act.

 

“Grace Period” has the meaning specified in Section 1(c).

 

“Holder” and “Holders” have the meanings specified in the first paragraph
hereof.

 

18

 

 

“Holder Free Writing Prospectus” means each Free Writing Prospectus prepared by
or on behalf of the relevant Holder or used or referred to by such Holder in
connection with the offering of Registrable Securities.

 

“Investor” has the meaning specified in the first paragraph hereof.

 

“Issuer Free Writing Prospectus” means an “issuer free writing prospectus” under
Rule 433 promulgated under the Securities Act.

 

“Lock-Up Period” has the meaning specified in Section 2.

 

“Losses” has the meaning specified in Section 5(e).

 

“Person” means an individual, a partnership, a corporation, a limited liability
company, an association, a joint stock company, a trust, a joint venture, an
unincorporated organization, a governmental entity or any department, agency or
political subdivision thereof or any other entity.

 

“Piggyback Shares” means the shares of common stock of the Company: (i) held by
TCP WR Acquisition, LLC (“TCP”) and issued pursuant to the purchase agreement by
and between the Company and TCP, dated February 2, 2012 and (ii) acquired in the
private placement transaction conducted by the Company and closed January 9,
2013, by certain Affiliates of the Company, as of the date hereof.

 

“PIPE Transaction” has the meaning specified in the recitals.

 

“Plan of Distribution” has the meaning specified in Section 1(a).

 

“Pre-Effective Suspension Period” has the meaning specified in Section 1(a).

 

“Prospectus” means the prospectus used in connection with a Registration
Statement and any amendments or supplements thereto.

 

“Purchase Agreement” has the meaning specified in the recitals.

 

“Purchase Amount” has the meaning specified in Section 1(c).

 

“Registrable Securities” means, at any time, any shares of Common Stock acquired
in the PIPE Transaction and any Piggyback Shares; provided, however, that, as to
any Registrable Securities, such securities shall cease to constitute
Registrable Securities upon the earliest to occur of: (i) the date that is six
months from the Closing Date, unless at the time of the date that is six months
from the Closing Date at least 25% of the shares of Common Stock issued pursuant
to the PIPE Transaction are held by Affiliates of the Company, in which case the
date shall be the earlier of the date that is one year from the Closing Date or
the date as of when at least 25% of the shares of Common Stock issued pursuant
to the PIPE Transaction shall cease to be held by Affiliates of the Company;
(ii) the date on which such securities are disposed of pursuant to an effective
registration statement under the Securities Act; (iii) the date on which such
securities are disposed of pursuant to Rule 144 (or any successor provision)
promulgated under the Securities Act (or by similar provision under the
Securities Act); (iv) the date on which such securities may no longer be deemed
“restricted securities” as defined in Rule 144(a)(3) under the Securities Act;
(v) with respect to the Registrable Securities held by any Holder, any time that
such Holder is permitted sell such Registrable Securities under Rule 144(b)(1)
(or by similar provision under the Securities Act); and (vi) the date on which
such securities cease to be outstanding. For the purposes of this Agreement, a
Person shall be deemed to be a holder of Registrable Securities whenever such
Person has the right to acquire such Registrable Securities (upon conversion or
exercise in connection with a transfer of securities or otherwise, but
disregarding any restrictions or limitation upon the exercise of such right),
whether or not such acquisition has been effected.

 

19

 

 

“Registration Expenses” means all expenses arising from or incident to the
registration of Registrable Securities in compliance with this Agreement,
including, without limitation, (i) Commission, stock exchange, FINRA and other
registration and filing fees, (ii) all fees and expenses incurred in connection
with complying with any securities or “blue sky” laws (including, without
limitation, fees, charges and disbursements of counsel in connection with “blue
sky” qualifications of the Registrable Securities), (iii) all printing,
messenger and delivery expenses, (iv) the fees, charges and disbursements of
counsel to the Company and of its independent public accountants and any other
accounting and legal fees, charges and expenses incurred by the Company, (v) the
fees and expenses incurred in connection with the quotation of Registrable
Securities on any inter-dealer quotation system and (vi) the reasonable fees,
charges and disbursements of Counsel to the Holders, including, for the
avoidance of doubt, any expenses of Counsel to the Holders in connection with
the filing or amendment of any Registration Statement, Prospectus or Free
Writing Prospectus hereunder.

 

“Registration Notice” has the meaning specified in Section 1(a).

 

“Registration Statement” means any registration statement filed hereunder.

 

“Rule 144A” has the meaning specified in Section 8.

 

“Securities Act” means the Securities Act of 1933, as amended from time to time.

 

“SEC Comments” has the meaning specified in Section 1(a).

 

“SEC Restrictions” has the meaning specified in Section 1(e).

 

“Selling Expenses” means the underwriting fees, discounts, selling commissions
and stock transfer taxes applicable to all Registrable Securities registered by
the Holders and legal expenses, expect as otherwise provided in the Purchase
Agreement or other documents regarding the PIPE Transaction.

 

“Selling Holder Information” has the meaning specified in Section 1(a).

 

“Shelf” has the meaning specified in Section 1(a).

 

“Shelf Amendment” has the meaning specified in Section 1(b).

 

20

 

 

“Shelf Amendment Notice” has the meaning specified in Section 1(b).

 

“Shelf Registration” means a registration of securities pursuant to a
registration statement filed with the Commission in accordance with and pursuant
to Rule 415 promulgated under the Securities Act (or any successor rule then in
effect).

 

“Shelf Selling Stockholder” has the meaning specified in Section 1(e).

 

“Shelf Term” has the meaning specified in Section 1(b).

 

“Suspension Period” has the meaning specified in Section 1(d).

 

* * *

 

21

 

 

IN WITNESS WHEREOF, the parties hereto have executed this Agreement as of the
date first written above.

 

  SEQUENTIAL BRANDS GROUP, INC.         By:       Name:     Title:

 

 

 

 

 

  Holder Name:    

 

  By:         Name:       Title:  

 

  Address for Notices:                             Facsimile:       Attention:  
 

  

 

 

 

 

EXHIBIT A

 

PLAN OF DISTRIBUTION

 

The selling stockholders, which as used herein includes donees, pledgees,
transferees or other successors-in-interest selling shares of common stock or
interests in shares of common stock received after the date of this prospectus
from a selling stockholder as a gift, pledge, partnership distribution or other
transfer, may, from time to time, sell, transfer or otherwise dispose of any or
all of their shares of common stock or interests in shares of common stock on
any stock exchange, market or trading facility on which the shares are traded or
in private transactions. These dispositions may be at fixed prices, at
prevailing market prices at the time of sale, at prices related to the
prevailing market price, at varying prices determined at the time of sale, or at
negotiated prices.

 

The selling stockholders may use any one or more of the following methods when
disposing of shares or interests therein:

 

·           ordinary brokerage transactions and transactions in which the
broker-dealer solicits purchasers;

 

·           block trades in which the broker-dealer will attempt to sell the
shares as agent, but may position and resell a portion of the block as principal
to facilitate the transaction;

 

·           purchases by a broker-dealer as principal and resale by the
broker-dealer for its account;

 

·           an exchange distribution in accordance with the rules of the
applicable exchange;

 

·           privately negotiated transactions;

 

·           short sales effected after the date the registration statement of
which this Prospectus is a part is declared effective by the Commission;

 

·           through the writing or settlement of options or other hedging
transactions, whether through an options exchange or otherwise;

 

·           broker-dealers may agree with the selling stockholders to sell a
specified number of such shares at a stipulated price per share;

 

·           a combination of any such methods of sale; and

 

·           any other method permitted by applicable law.

 

 

 

 

The selling stockholders may, from time to time, pledge or grant a security
interest in some or all of the shares of common stock owned by them and, if they
default in the performance of their secured obligations, the pledgees or secured
parties may offer and sell the shares of common stock, from time to time, under
this prospectus, or under an amendment to this prospectus under Rule 424(b)(3)
or other applicable provision of the Securities Act amending the list of selling
stockholders to include the pledgee, transferee or other successors in interest
as selling stockholders under this prospectus. The selling stockholders also may
transfer the shares of common stock in other circumstances, in which case the
transferees, pledgees or other successors in interest will be the selling
beneficial owners for purposes of this prospectus.

 

In connection with the sale of our common stock or interests therein, the
selling stockholders may enter into hedging transactions with broker-dealers or
other financial institutions, which may in turn engage in short sales of the
common stock in the course of hedging the positions they assume. The selling
stockholders may also sell shares of our common stock short and deliver these
securities to close out their short positions, or loan or pledge the common
stock to broker-dealers that in turn may sell these securities. The selling
stockholders may also enter into option or other transactions with
broker-dealers or other financial institutions or the creation of one or more
derivative securities which require the delivery to such broker-dealer or other
financial institution of shares offered by this prospectus, which shares such
broker-dealer or other financial institution may resell pursuant to this
prospectus (as supplemented or amended to reflect such transaction).

 

The aggregate proceeds to the selling stockholders from the sale of the common
stock offered by them will be the purchase price of the common stock less
discounts or commissions, if any. Each of the selling stockholders reserves the
right to accept and, together with their agents from time to time, to reject, in
whole or in part, any proposed purchase of common stock to be made directly or
through agents. We will not receive any of the proceeds from this offering.

 

The selling stockholders also may resell all or a portion of the shares in open
market transactions in reliance upon Rule 144 under the Securities Act of 1933,
provided that they meet the criteria and conform to the requirements of that
rule.

 

The selling stockholders and any underwriters, broker-dealers or agents that
participate in the sale of the common stock or interests therein may be
“underwriters” within the meaning of Section 2(11) of the Securities Act. Any
discounts, commissions, concessions or profit they earn on any resale of the
shares may be underwriting discounts and commissions under the Securities Act.
Selling stockholders who are “underwriters” within the meaning of Section 2(11)
of the Securities Act will be subject to the prospectus delivery requirements of
the Securities Act.

 

To the extent required, the shares of our common stock to be sold, the names of
the selling stockholders, the respective purchase prices and public offering
prices, the names of any agents, dealer or underwriter, any applicable
commissions or discounts with respect to a particular offer will be set forth in
an accompanying prospectus supplement or, if appropriate, a post-effective
amendment to the registration statement that includes this prospectus.

 

In order to comply with the securities laws of some states, if applicable, the
common stock may be sold in these jurisdictions only through registered or
licensed brokers or dealers. In addition, in some states the common stock may
not be sold unless it has been registered or qualified for sale or an exemption
from registration or qualification requirements is available and is complied
with.

 

 

 

 

 

We have advised the selling stockholders that the anti-manipulation rules of
Regulation M under the Exchange Act may apply to sales of shares in the market
and to the activities of the selling stockholders and their affiliates. In
addition, to the extent applicable we will make copies of this prospectus (as it
may be supplemented or amended from time to time) available to the selling
stockholders for the purpose of satisfying the prospectus delivery requirements
of the Securities Act. The selling stockholders may indemnify any broker-dealer
that participates in transactions involving the sale of the shares against
certain liabilities, including liabilities arising under the Securities Act.

 

We have agreed to indemnify the selling stockholders against certain
liabilities, including liabilities under the Securities Act and state securities
laws, relating to the registration of the shares offered by this prospectus.

 

We have agreed with the selling stockholders to keep the registration statement
of which this prospectus constitutes a part effective until the earlier of (1)
such time as all of the shares covered by this prospectus have been disposed of
pursuant to and in accordance with the registration statement or (2) the date on
which all of the shares may be sold without restriction pursuant to Rule 144 of
the Securities Act.

 

 

 

 

 

EXHIBIT B

 

SEQUENTIAL BRANDS GROUP, INC

 

Notice and Eligible Holder Information Questionnaire

 

The undersigned beneficial owner of capital stock of Sequential Brands Group,
Inc., a Delaware corporation (the “Company”), understands that the Company has
filed or intends to file with the Securities and Exchange Commission (the “SEC”)
one or more registration statements (collectively, the “Registration Statement”)
for the registration and resale under Rule 415 of the Securities Act of 1933, as
amended (the “Securities Act”), of the Registrable Securities in accordance with
the terms of the Registration Rights Agreement of which this questionnaire is a
part (the “Registration Rights Agreement”), dated as of July 26, 2013 (the
“Closing Date”), by and among the Company and the parties identified as the
“Holders” on the signature page thereto. All capitalized terms not otherwise
defined herein shall have the meaning ascribed thereto in the Registration
Rights Agreement.

 

Certain legal consequences arise from being named as a selling securityholder in
the Registration Statement and the related prospectus, as the case may be.
Accordingly, holders and beneficial owners of Registrable Securities are advised
to consult their own securities law counsel regarding the consequences of being
named or not being named as an Eligible Holder in the Registration Statement and
the related prospectus.

 

NOTICE

 

The undersigned beneficial owner (the “Eligible Holder”) of Registrable
Securities hereby elects to include some or all of the Registrable Securities
owned by it in the Registration Statement. In order to sell or otherwise dispose
of any Registrable Securities pursuant to the Registration Statement, a
beneficial owner of Registrable Securities generally will be required to be
named as a selling securityholder in the related prospectus and deliver a
prospectus to each purchaser of Registrable Securities.

 

If you wish to include the Registrable Securities beneficially owned by you in
the Registration Statement (or a supplement or amendment thereto), you must
complete, sign and deliver this Notice of Registration Statement and Eligible
Holder Information Questionnaire (“Notice and Questionnaire”) to the Company at
the address set forth herein on or prior to the fifth (5th) business day prior
to filing of the Registration Statement (or supplement or amendment, as
applicable). If you fail to do so, you will not be named as an Eligible Holder
in the Registration Statement and may not be able to use the prospectus forming
a part thereof to resell the Registrable Securities that you hold.

 

COMPLETED NOTICE AND QUESTIONNAIRE

 

PLEASE SEND BY PDF A COPY OF THE COMPLETED AND EXECUTED NOTICE AND QUESTIONNAIRE
TO: Sarah Travis at sarah.travis@whitecase.com.

 

 

 

 

 

 

 

The undersigned hereby provides the following information to the Company and
represents and warrants that such information is accurate:

 

QUESTIONNAIRE

 

1.          Name and Security Ownership

 

(a)          Full legal name of each registered holder of Registrable Securities
and number of Registrable Securities held:

 

Name

Number of Registrable
Securities

                       

  

(b)          Full legal name of each registered holder of any other securities
of the Company and number of such securities held

 

Name

Number of Other Securities

                       

 

2.          Securities To Be Included In the Registration Statement

 

(a)          Do you wish to include in the registration statement all of the
Registrable Securities listed in item 1(a) above?

 

Yes ¨          No ¨

 

(b)          If your answer to item 2(a) above is “no,” please specify below the
number of shares that you wish to include:

 

Name

Number of Registrable
Securities

                       

 

 

 

 

 

3.Beneficial Ownership of Securities of the Company Owned by the Eligible
Holder(s)

 

“Beneficial ownership” is determined according to rules of the SEC. Securities
are “beneficially owned” by any person who, directly or indirectly, through any
contract, arrangement, understanding, relationship, or otherwise has or shares
(i) voting power, which includes the power to vote, or to direct the voting of,
such security, and/or, (ii) investment power, which includes the power to
dispose, or to direct the disposition of, such security. The definition of
beneficial ownership often requires disclosure of the individual or groups of
individuals who have or share voting or investment power over the shares in
question.

 

Please describe below or attach as a separate sheet a detailed description of
the beneficial ownership of the Registrable Securities and any other securities
of the Company held by the Eligible Holder. We recommend that you consult with
your own securities law counsel as some or all of the description below will be
included in the Registration Statement. You should also indicate clearly whether
one or more of the beneficial owners disclaims beneficial ownership except to
the extent of his, her or its pecuniary interest in the securities. Annex A
hereto provides a typical example of beneficial ownership disclosure.

 

             

  

4. Relationships with the Company:

 

Except as set forth below, neither the undersigned nor any of its affiliates,
officers, directors or principal equity holders (owners of 5% of more of the
equity securities of the undersigned) has held any position or office or has had
any other material relationship with the Company (or its predecessors or
affiliates) during the past three (3) years.

 

State any exceptions here:

 

   

 

5. Broker-Dealer Status:

 

(a)          Is any Eligible Holder a broker-dealer? 

 

Yes ¨          No ¨

 

 

 

 

 

(b)           If the answer is “yes” to item 5(a) above, did such Eligible
Holder receive the Registrable Securities as compensation for investment banking
services to the Company?

 

Yes ¨          No ¨

 

Note: If the answer is “no” to this item 5(b), the SEC’s staff has indicated
that you should be identified as an underwriter in the Registration Statement.

 

(c)           Is any Eligible Holder an affiliate of a broker-dealer?

 

Yes ¨          No ¨

 

(d)           If any of the Eligible Holders is an affiliate of a broker-dealer,
do you certify that such Eligible Holder purchased the Registrable Securities in
the ordinary course of business, and at the time of the purchase of the
Registrable Securities to be resold, had no agreements or understandings,
directly or indirectly, with any person to distribute the Registrable
Securities?

 

Yes ¨          No ¨

 

Note: If the answer is “no” to this item 5(d), the SEC’s staff has indicated
that the Eligible Holder should be identified as an underwriter in the
Registration Statement.

 

Please provide any further information here:

 

           

 

6. Address for Notices to Selling Holder:

 

Contact Person: Contact Person Email Address: Telephone: Fax:

  

The undersigned agrees to promptly notify the Company of any inaccuracies or
changes in the information provided herein that may occur subsequent to the date
hereof at any time while the Registration Statement remains effective.

 

 

 

 

 

By signing below, the undersigned consents to the disclosure of the information
contained herein in its answers to items one (1) through five (5) and the
inclusion of such information in the Registration Statement and the related
prospectus and any amendments or supplements thereto, as the case may be. The
undersigned understands that such information will be relied upon by the Company
in connection with the preparation or amendment of the Registration Statement
and the related prospectus.

 

IN WITNESS WHEREOF the undersigned, by authority duly given, has caused this
Notice and Questionnaire to be executed and delivered either in person or by its
duly authorized agent.

 

  Beneficial Owner(s):  

 

  By:       Name:     Title:         Date:  

 

 

 

 

 

ANNEX A 

 

Model Beneficial Ownership Disclosure:

 

ABC Fund Management L.P. (“ABC Management LP”) is the investment manager for ABC
Capital Fund (“ABC Capital”) and ABC Capital II Fund (“ABC Capital II” and,
together with ABC Capital, the “ABC Funds”).  ABC Capital Management LLC (“ABC
Management LLC”) is the general partner of ABC Management LP.  The managing
members of ABC Management LLC are Individual A, Individual B and Individual C
(collectively the “ABC Managers”).  ABC Management LP, ABC Management LLC and
each of the ABC Managers may be deemed to beneficially own the securities held
by the ABC Funds.  ABC Management LP, ABC Management LLC and each of the ABC
Managers each disclaim beneficial ownership of such securities except to the
extent of their pecuniary interests therein.

 

 

 

 

 

EXHIBIT C

 

FORM OF JOINDER AGREEMENT

 

Ladies and Gentlemen:

 

Reference is made to the Registration Rights Agreement, dated as of July 26,
2013 (as such agreement may have been or may be amended from time to time) (the
“Registration Rights Agreement”), by and among Sequential Brands Group, Inc., a
Delaware corporation (the “Company”), each of the other parties signatory
thereto and any other parties identified on the signature pages of any joinder
agreements substantially similar to this joinder agreement executed and
delivered pursuant to Section 10 of the Registration Rights Agreement.
Capitalized terms used but not otherwise defined herein have the meanings set
forth in the Registration Rights Agreement.

 

In consideration of the transfer to the undersigned of Registrable Securities of
the Company, the undersigned represents that it is a transferee of [insert name
of transferor] and agrees that, as of the date written below, the undersigned
shall become a party to the Registration Rights Agreement, and shall be fully
bound by, and subject to, all of the covenants, terms and conditions of the
Registration Rights Agreement as though an original party thereto.

 

[SIGNATURE PAGE FOLLOWS]

 

 

 

 

  

Executed as of the _______ day of __________________, _____.

 

TRANSFEREE: [insert name of transferee]

 

By:

Name:

Title:

 

Address:            

  

Acknowledged and agreed by:

 

SEQUENTIAL BRANDS GROUP, INC.

 

By:

Name:

Title: