Exhibit 4.2


 


AMENDMENT NO. 1


TO REGISTRATION RIGHTS AGREEMENT


 


THIS AMENDMENT NO. 1 (“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 Buyers. Capitalized terms used herein and undefined shall
have the meanings set forth in that certain Senior Registration Rights Agreement
(defined in the Recitals below).


 


RECITALS:


 


WHEREAS, reference is made to that certain Registration
Rights Agreement dated as of July 28, 2005 (the “Senior Registration
Rights  Agreement”), by and among the
Company and the Buyers;


 


WHEREAS, a resale registration statement on Form
SB-2 filed with the Securities and Exchange Commission (“SEC”)
by the Company was declared effective by the staff of the SEC (the “Staff”) on December 9, 2005 (the “Form
SB-2”);


 


WHEREAS, the Form SB-2 covers the resale of the Registrable
Securities purchased by the Buyers from the Company;


 


WHEREAS, pursuant to the rules set forth under the
Securities Act of 1933, as amended (the “Act”), the
Company is required to file with the SEC a post-effective amendment to the Form
SB-2 in order to update disclosures and to include the Company’s year-end audited
financial information contained in its Form 10-KSB (each, a “10-KSB Post-Effective Amendment”);


 


WHEREAS, a 10-KSB Post-Effective Amendment is subject
to review and comment by the Staff (a “Review Period”);


 


WHEREAS, resales of the Registrable Securities
cannot be effected by the Buyers pursuant to the Form SB-2 during a Review
Period (an “Effectiveness Lapse”);


 


WHEREAS, the undersigned Buyer and the Company wish
to clarify and agree that an Effectiveness Lapse that is triggered solely by
the filing of a 10-KSB Post-Effective Amendment shall not be deemed a
Maintenance Failure under Section 2f. of the Senior Registration Rights
Agreement, unless such Effectiveness Lapse exceeds a period of forty-five (45)
days;


 


WHEREAS, Section 10 of the Senior Registration
Rights Agreement permits any provision of the Senior Registration Rights
Agreement 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, pursuant to the terms of the Senior
Registration Rights Agreement, any amendment of a provision of the Senior Registration
Rights Agreement by the holder or holders representing at least a majority of
the principal amount of the Notes outstanding shall be binding on all of the other
Buyers; and


 


WHEREAS, the undersigned Buyers 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:


 


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1.             AMENDMENT.


 


(a)           Section
2.f.            Notwithstanding anything
contained in Section 2.f. of the Senior Registration Rights Agreement to the
contrary, the Buyers agree that any Effectiveness Lapse that is triggered
solely by the filing with the SEC of a 10-KSB Post-Effective Amendment shall
not be deemed a Maintenance Failure until the Allowable Grace Period set forth
in Section 1(c) below has expired. The Company further agrees to respond to any
Staff comments relating to a 10-KSB Post-Effective Amendment that is received
during the Review Period by no later than 5:30 p.m. Eastern Time on the seventh
(7th) Business Day following receipt of any such Staff comments (the “Response Deadline”). In the event the Company fails to
respond to any such Staff comments by the Response Deadline, such failure shall
then be treated as a Maintenance Failure under Section 2.f of the Senior
Registration Rights Agreement for purposes of Registration Delay Payments but
such failure to respond shall not be considered an Event of Default under
Section 8(c) of the Note and Warrant Purchase Agreement dated as of July 28,
2005 between Company, Buyer and the other parties thereto. For purposes of
calculating any Registration Delay Payments pursuant to this Section 1(a) only,
penalties shall accrue beginning the earlier of (i) the date immediately
after the date the Allowable Grace Period expires or (ii) the date immediately
after the date the Company fails to meet the Response Deadline, as applicable.


 


(b)           Section
3.b.           Notwithstanding anything
contained in Section 3.b. of the Senior Registration Rights Agreement to the
contrary, the Buyers agree that the Company shall have ten (10) Business Days
following the filing with the SEC of its Form 10-KSB to file a 10-KSB Post-Effective
Amendment; provided, however, that in the event
that the Company does not file a 10-KSB on or prior to the date such filing is
required by the SEC, but does file a valid request for extension under 12b-25
prior to such date, the Company may extend the ten (10) Business Day period referenced
above for a maximum of up to five (5) additional Business Days after the date
that such filing is required to be made under the SEC rules and regulations. In
no event shall the Company be permitted to file the 10-KSB Post-Effective
Amendment more than fifteen (15) Business Days after the date that the Form
10-KSB is required to be filed under the SEC rules and regulations.


 


(c)           Section
3.o.           Notwithstanding anything
contained in Section 3.o. of the Senior Registration Rights Agreement to the
contrary, the Buyers agree that the period of time from the filing with the SEC
of a 10-KSB Post-Effective Amendment until the declaration of effectiveness of
such 10-KSB Post-Effective Amendment by the Staff shall be deemed an Allowable
Grace Period; provided, however, the Allowable
Grace Period relating to the filing with the SEC of a 10-KSB Post-Effective
Amendment and having such 10-KSB Post-Effective Amendment declared effective shall
not exceed a period of forty-five (45) days. The measurement period of the
Allowable Grace Period for the 10-KSB Post Effective Amendment shall begin to
run on the earlier of (i) the date that the 10-KSB Post-Effective
Amendment is filed by the Company with the SEC or (ii) the date on which
the 10-KSB Post-Effective Amendment is permitted to be filed under (b) above.


 


2.             CONFLICTS. Except as
expressly set forth in this Amendment, the terms and provisions of the Senior
Registration Rights Agreement shall continue unmodified and in full force and
effect. In the event of any conflict between this Amendment and the Senior Registration
Rights Agreement, this Amendment shall control.


 


3.             GOVERNING
LAW. This 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.


 


4.             COUNTERPARTS. This 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.


 


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IN WITNESS WHEREOF, the parties hereto have executed this 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

  	
   

  
	
   

  
	
   

  
	
  BUYERS:

  
	
   

  
	
  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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