Exhibit 4.1


 


OMNIBUS AMENDMENT


TO NOTE AND WARRANT PURCHASE
AGREEMENT AND


WARRANTS TO PURCHASE COMMON STOCK


 


THIS OMNIBUS AMENDMENT (“Omnibus
Amendment”) is made and entered into as
of this 7th day of April, 2006, by and among ARTISTdirect, Inc., a Delaware
corporation (the “Company”), and the undersigned Purchasers.
Capitalized terms used herein and undefined shall have the meanings set forth
in that certain NP Agreement (defined in the Recitals below).


 


RECITALS:


 


WHEREAS, reference is made to that certain Note and
Warrant Purchase Agreement dated as of July 28, 2005 (the “NP  Agreement”), by
and among the Company and the Purchasers;


 


WHEREAS, the parties wish to provide for a temporary
reduction in the exercise price of the shares of Common Stock underlying the Warrants,
provided that a portion of the cash proceeds received by the Company related to
any exercise of shares of Common Stock underlying the Warrants by any Purchaser
shall be used by the Company to make a partial prepayment of the outstanding
principal amount of their respective Note;


 


WHEREAS, Section 13(e) of the NP Agreement and
Section 10 of the Warrants permit any provision of the NP Agreement and the Warrants,
as applicable, to be amended upon the written consent of the holder or holders
representing at least a majority of the principal amount of the Notes
outstanding;


 


WHEREAS, the undersigned Purchasers hold one hundred
percent (100%) of the principal amount of the Notes outstanding.


 


NOW, THEREFORE, in consideration of the foregoing recitals
and the mutual agreements herein contained and for other good and valuable
consideration, the parties hereto agree as follows:


 


1.             AMENDMENT
TO NP AGREEMENT. Notwithstanding anything contained in Section 3(c)
of the NP Agreement to the contrary, with respect to the Temporary EP Reduction
(as described in Section 2(a) below) only, the Purchasers agree that the
Company need not allocate any partial prepayments in proportion to the
respective unpaid principal amounts of the Notes.


 


2.             AMENDMENT
TO WARRANTS.


 


(a)           Notwithstanding
anything contained in Section 1(c) of the Warrants to the contrary, the parties
agree that for the period from April 7, 2006 until April 30, 2006 only, the
exercise price of the shares of Common Stock underlying the Warrants shall be $1.85
per share (the “Temporary EP Reduction”); provided, that, any Purchaser that elects to exercise any
portion of their respective Warrant (an “Electing Purchaser”)
during the period of the Temporary EP Reduction must (i) return an irrevocable
exercise notice to the Company by no later than the end of business on April 30,
2006 (a “Notice”) and (ii) make all payments to
the Company covering the aggregate exercise price of the shares of Common Stock
underlying the Warrants set forth in a Notice by cash payment or wire transfer
of immediately available funds by no later than the end of business on April 30,
2006.


 


(b)           The Company
agrees that twenty-five percent (25%) of the aggregate net cash proceeds
received by it from any Electing Purchaser during the period of the Temporary
EP Reduction only, shall be applied to the prepayment of an equal amount of the
outstanding principal amount of such Electing


 


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Purchaser’s respective Note. In addition, the Company agrees to pay all
accrued and unpaid interest with respect to any prepayment amount on the same
date as the prepayment of the Notes pursuant to this Section 2(b), which shall
be no later than the end of business on May 2, 2006.


 


(c)           The parties
agree that each Electing Purchaser shall return their Note to the Company so
that it may mark such Note with a notation to properly indicate that a portion
of the outstanding principal amount has been prepaid in accordance with the
terms of this Ominbus Amendment and the terms set forth in Section 3(c) of the
NP Agreement.


 


3.             WAIVER. The parties
acknowledge that the Company is also offering (a) a permanent reduction in the
exercise price of warrants issued on July 28, 2005 to holders of subordinated
debt from an exercise price of $1.55 per share to $1.43 per share and (b) a
temporary reduction in the exercise price of warrants issued on July 28, 2005 to
Libra FE, LP. from an exercise price of $2.00 per share to $1.85 per share, from
April 7, 2006 until April 30, 2006 (collectively, the “Simultaneous
Offer”). The Purchasers hereby agree to forever waive any
anti-dilution adjustments set forth in Section 2 of the Warrants triggered with
respect to the Simultaneous Offer only.


 


4.             CONFLICTS. Except as
expressly set forth in this Omnibus Amendment, the terms and provisions of the NP
Agreement and the Warrants shall continue unmodified and in full force and
effect. In the event of any conflict between this Omnibus Amendment and the NPA
Agreement or the Warrants, this Omnibus Amendment shall control.


 


5.             GOVERNING
LAW. This Omnibus Amendment shall be governed and construed under the laws
of the State of New York, and shall be binding on and shall inure to the
benefit of the parties and their respective successors and permitted assigns.


 


6.             COUNTERPARTS. This Omnibus Amendment
may be executed in any number of counterparts, each of which shall be an
original, but all of which together shall constitute one instrument.


 


[Remainder of page left blank intentionally.]


 


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IN WITNESS WHEREOF, the parties hereto have executed this Omnibus Amendment
as of the date first set forth above.


 


 


	
  COMPANY:

  
	
   

  
	
  ARTISTdirect, Inc.

  
	
   

  
	
  By:

  	
  /s/ Robert N. Weingarten

  	
   

  
	
   

  
	
  Name:

  	
  Robert N. Weingarten

  	
   

  
	
   

  
	
  Title:

  	
  Chief Financial Officer

  	
   

  
	
   

  
	
   

  
	
  PURCHASERS:

  
	
   

  
	
  JMB Capital Partners, L.P.

  
	
   

  
	
  By:

  	
  /s/ Cyrus Hadidi

  	
   

  
	
   

  
	
  Name:

  	
  Cyrus Hadidi

  	
   

  
	
   

  
	
  Title:

  	
  Partner

  	
   

  
	
   

  
	
  JMG Capital Partners, L.P.

  
	
   

  
	
  By:

  	
  /s/ [ILLEGIBLE]

  	
   

  
	
   

  
	
  Name:

  	
  [ILLEGIBLE]

  	
   

  
	
   

  
	
  Title:

  	
  [ILLEGIBLE]

  	
   

  
	
   

  
	
   

  
	
  JMG Triton Offshore Fund, Ltd.

  
	
   

  
	
  By:

  	
  /s/ [ILLEGIBLE]

  	
   

  
	
   

  
	
  Name:

  	
  [ILLEGIBLE]

  	
   

  
	
   

  
	
  Title:

  	
  [ILLEGIBLE]

  	
   

  
	
   

  
	
   

  
	
  CCM Master Qualified Fund, Ltd.

  
	
   

  
	
  By:

  	
  /s/ Clint D. Coghill

  	
   

  
	
   

  
	
  Name:

  	
  Clint D. Coghill

  	
   

  
	
   

  
	
  Title:

  	
  Director

  	
   

  
													



 


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