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EXHIBIT 10.2  


 
 

US SEARCH.COM INC.
  
    FIRST AMENDMENT
  
    TO
  
    INVESTORS' RIGHTS AGREEMENT    
  


    THIS FIRST AMENDMENT TO INVESTORS' RIGHTS AGREEMENT (this
"Amendment") is entered into as of June 5, 2001, by and among US SEARCH.COM INC., a Delaware corporation (the
"Company"), PEQUOT PRIVATE EQUITY FUND II, L.P., a Delaware limited partnership (the "Investor") and the
holders of common stock of the Company set forth on the signature page to this Amendment (the "KL Holders"). 


 
 

R E C I T A L S    
  


    WHEREAS, the parties to this Amendment are parties to that certain Investors' Rights Agreement, dated as of
September 7, 2000 (the "Agreement"); 


    WHEREAS, the Company and the Investor have entered into a Preferred Stock Exchange and Purchase Agreement, of even date herewith (the
"Exchange Agreement"), pursuant to which the Investor has agreed to exchange certain securities of the Company for newly issued shares of
Series A-1 Convertible Preferred Stock of the Company (the "Series A-1 Shares"), to convert outstanding promissory
notes of the Company held by the Investor into additional Series A-1 Shares and to receive a warrant to purchase up to 5,000 additional Series A-1 Shares subject
to the terms and conditions set forth therein; and 


    WHEREAS, in connection with the transactions contemplated by the Exchange Agreement and to induce the Investor to enter into the
Exchange Agreement the parties hereto desire to amend the Agreement as provided below. 


 
 

A M E N D M E N T    
  


    NOW, THEREFORE, BE IT RESOLVED, that in consideration of the foregoing and for good and valuable consideration
the receipt and sufficiency of which are hereby acknowledged, the Agreement is hereby amended as set forth below. 


    1.  The
definition of "Purchase Agreement" appearing in the first recital to the Agreement is hereby deleted, and all references to the Purchase Agreement shall mean
the Exchange Agreement for all purposes under the Agreement. 


    2.  The
definition of "First Closing" appearing in Section 1.1 of the Agreement is hereby deleted, and all references to the First Closing shall mean
September 7, 2000. 


    3.  The
definition of "Second Closing" appearing in Section 1.1 of the Agreement is hereby deleted, and all references to the Second Closing shall mean the
"Closing," as defined in the Exchange Agreement, for all purposes under the Agreement. 


    4.  The
definition of "Registrable Securities" appearing in Section 1.1 of the Agreement is hereby deleted in its entirety and replaced with the following: 



"Registrable Securities" shall mean (a) shares of Common Stock or any other security received or receivable upon conversion of the Shares or upon
conversion of the Series A-1 Preferred Stock issuable upon exercise of the Series A-1 Warrant (as defined in the Exchange Agreement) (the "Warrant Shares");
(b) all shares of Common Stock, or Common Stock issued as or issuable upon the conversion or exercise of any warrant, right or any other convertible security, which is purchased from or
exchanged with the Company by the Pequot Holder on or after the Second Closing; (c) shares of Common Stock held by the KL Holders; (d) any securities received by the 






 


Pequot Holder pursuant to the exercise of their Preemptive Rights; (e) any security received or receivable as a dividend, stock split or other distribution with respect to any Shares or the
Warrant Shares; (f) any security received in exchange for or in replacement or any Registrable Securities; (g) any security issued or issuable with respect to any Registrable Securities
as a result of change or reclassification of Registrable Securities or any capital reorganization of the Company; (h) shares of Common Stock held by the Pequot Holder and (i) any
security received or receivable by a holder in respect of Registrable Securities as a result of a merger or consolidation of the Company.
Notwithstanding the foregoing, Registrable Securities shall not include any securities sold by a person to the public either pursuant to a registration statement or Rule 144 or sold in a
private transaction in which the transferor's rights under Section 2 of this Agreement are not assigned. 




    5.  The
definition of "Shares" appearing in Section 1.1 of the Agreement is hereby deleted in its entirety and replaced with the following: 



"Shares" shall mean the Company's Series A-1 Convertible Preferred Stock issued pursuant to the Exchange Agreement and held by the
Pequot Holder listed on Exhibit A hereto and its permitted assigns. 




    6.  Section 2.2(a)
of the Agreement is hereby deleted in its entirety and replaced with the following: 



(i)
At any time, and from time to time, the Holders of more than fifty percent (50%) of then outstanding Registrable Securities which are then owned by the Pequot Holder (the
"Pequot Initiating Holder") shall have the right, by written notice, delivered to the Company to require the Company to register Registrable Securities
having an aggregate offering price (before deducting of underwriting discounts and commissions) to the public in excess of $5,000,000 (a "Qualified Public
Offering") and (ii) at any time, and from time to time, the Holders of more than fifty percent (50%) of then outstanding Registrable Securities which are then owned by
the KL Holders (the "KL Initiating Holders") shall have the right, by written notice, delivered to the Company to require the Company to register
Registrable Securities in a Qualified Public Offering, then the Company shall, within thirty (30) days of the receipt thereof, give written notice of such request to all Holders, and subject to
the limitations of this Section 2.2, effect, as expeditiously as reasonably possible, the registration under the Securities Act of all Registrable Securities that the Holders request to be
registered. 




    7.  Exhibit A
of the Agreement is hereby deleted in its entirety and replaced with Exhibit A hereto. 


    8.  The
definition of "Series A Preferred Stock" appearing in the first recital to the Agreement is hereby deleted, and all references to Series A
Preferred Stock shall mean Series A-1 Shares for all purposes under the Agreement. 


[Signature
Page Follows] 


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



	

US SEARCH.COM INC.	
 	

PEQUOT PRIVATE EQUITY FUND II, L.P.
	

 	
 	

 	
 	

By:	
 	

Pequot Capital Management, Inc.
	 	 	 	 	Its:	 	Investment Manager
	By:	 	/s/ BRENT N. COHEN   
 Brent N. Cohen

Chief Executive Officer	 	 	 	 
	 	 	 	 	By:	 	/s/ KEVIN E. O'BRIEN   
 Kevin E. O'Brien

General Counsel
	

 	
 	

 	
 	

THE KUSHNER-LOCKE COMPANY
	

 	
 	

 	
 	

 	
 	

 
	

 	
 	

 	
 	

By:	
 	

/s/ PETER LOCKE   

	 	 	 	 	Name:
	 	 	 	 	Title:
	

 	
 	

 	
 	

 	
 	

 
	

 	
 	

 	
 	

/s/ DONALD KUSHNER   
 Donald Kushner
	

 	
 	

 	
 	

 	
 	

 
	

 	
 	

 	
 	

/s/ PETER LOCKE   
 Peter Locke






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Exhibit A
  
    SCHEDULE OF Pequot Holders    
  


PEQUOT PRIVATE EQUITY FUND II, L.P.
  500 Nyala Farm Road

West Port, CT 06880

Attn: Amber Tencic and Carol Holley

Facsimile: (203) 429-2900 









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US SEARCH.COM INC. FIRST AMENDMENT TO INVESTORS' RIGHTS AGREEMENT

R E C I T A L S

A M E N D M E N T

Exhibit A SCHEDULE OF Pequot Holders