Registration Rights Agreement



Exhibit 4.4 
 
REGISTRATION RIGHTS AGREEMENT 
 
REGISTRATION RIGHTS AGREEMENT (this “Agreement”), dated as of February
            , 2003 by and among K2 Inc., a Delaware corporation (the “Company”), and the undersigned (together with their respective affiliates and any assignee or
transferee of all of their respective rights hereunder, the “Initial Investors”). 
 
WHEREAS: 
 
A. In connection with the Securities Purchase Agreement by and among the parties hereto of even date herewith (the
“Securities Purchase Agreement”), the Company has agreed, upon the terms and subject to the conditions contained therein, to issue and sell to the Initial Investors (i) convertible subordinated debentures (the
“Debentures”) that are convertible into shares of the Company’s common stock, par value $1.00 per share (the “Common Stock”), upon the terms and subject to the limitations and conditions set forth in such
Debentures and (ii) warrants (the “Warrants”) to acquire Five Hundred Twenty Four Thousand Three Hundred Twenty Nine (524,329) shares of Common Stock, upon the terms and conditions and subject to the limitations and conditions set
forth in the Stock Purchase Warrant, dated February             , 2003, issuable in connection with the Debentures; and 
 
B. To induce the Initial Investors to execute and deliver the Securities Purchase Agreement, the
Company has agreed to provide certain registration rights under the Securities Act of 1933, as amended, and the rules and regulations thereunder, or any similar successor statute (collectively, the “1933 Act”), and applicable state
securities laws; 
 
NOW, THEREFORE, 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 Initial Investors hereby agree as follows: 
 









 
1.
DEFINITIONS. 
 
 
a. As used in this Agreement, the following terms shall have the following meanings: 
 
 
(i) “Investors” means, collectively, the Initial Investors and any transferee or assignee of an Initial Investor who agrees to become bound by the provisions of this Agreement in
accordance with Section 9 hereof. 
 
(ii) “register,” “registered,” and “registration” refer to a registration effected by preparing and filing a Registration Statement or Statements in compliance with the 1933 Act and
pursuant to Rule 415 under the 1933 Act or any successor rule providing for offering securities on a continuous basis (“Rule 415”), and the declaration or ordering of effectiveness of such Registration Statement by the United States
Securities and Exchange Commission (the “SEC”). 
 
(iii) “Registrable Securities” means (A) the Conversion Shares (as defined in the Securities Purchase Agreement) issued or issuable upon conversion of or otherwise pursuant to the
Debenture and Section 2(c) herein; (B) the Warrant Shares (as defined in the Securities Purchase Agreement) issued or issuable and any shares of capital stock issued or issuable upon exercise of the Warrants; and (C) any shares of capital stock
issued or issuable as a dividend on or in exchange for or otherwise with respect to any of the foregoing. 
 
(iv) “Registration Statement(s)” means a registration statement(s) of the Company under the 1933 Act.

 
 
b. Capitalized terms used herein and not otherwise defined herein shall have the respective meanings set forth in the Securities Purchase Agreement. 
 
 
2. REGISTRATION. 
 
 
a. Mandatory Registration. The Company shall prepare, and, on or prior to the date (the “Filing Date”)
which is sixty (60) calendar days after the Closing Date (as defined in the Securities Purchase Agreement), file with the SEC a Registration Statement on Form S-3 (or, if Form S-3 is not then available, on such form of Registration Statement as is
then available to effect a registration of the Registrable Securities, subject to the consent of the Initial Investors, which consent will not be unreasonably withheld) covering the resale of the Registrable Securities, which Registration Statement,
to the extent allowable under the 1933 Act and the rules and regulations promulgated thereunder (including Rule 416), shall state that such Registration Statement also covers such indeterminate number of additional shares of Common Stock as may
become issuable upon conversion of or otherwise pursuant to the Debenture and exercise of or otherwise pursuant to the Warrants (i) to prevent dilution resulting from stock splits, stock dividends or similar transactions or (ii) by reason of changes
in the Conversion Price (as defined in the Debenture) of the Debenture in accordance with the terms thereof or the exercise price of the Warrants in accordance with the terms thereof. The number of shares of Common Stock initially included in such
Registration Statement shall be no less than one hundred twenty percent of the aggregate number of Conversion Shares and Warrant Shares that 
 

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are then issuable upon
conversion of or otherwise pursuant to the Debentures (based on Conversion Price then in effect) and the exercise of or otherwise pursuant to the Warrants, in each case without regard to any limitation on the Investor’s ability to convert the
Debenture or exercise the Warrants. The Company acknowledges that the number of shares initially included in the Registration Statement represents a good faith estimate of the maximum number of shares issuable upon conversion of or otherwise
pursuant to the Debenture and exercise of or otherwise pursuant to the Warrants. The Registration Statement (and each amendment or supplement thereto, and each request for acceleration of effectiveness thereof) shall be provided to the Initial
Investors and their counsel prior to its filing or other submission in accordance with Section 3(h) hereof. 
 
b. Underwritten Offering. If any offering pursuant to a Registration Statement pursuant to Section 2(a) hereof
involves an underwritten offering, the Investors who hold a majority in interest of the Registrable Securities subject to such underwritten offering, with the consent of the Initial Investors, shall have the right to select one legal counsel to
administer the offering, which legal counsel shall be reasonably satisfactory to the Company. In the event that any Investors elect not to participate in such underwritten offering, the Registration Statement covering all of the Registrable
Securities shall contain appropriate plans of distribution reasonably satisfactory to the Investors participating in such underwritten offering and the Investors electing not to participate in such underwritten offering (including, without
limitation, the ability of non-participating Investors to sell from time to time at any time during the effectiveness of such Registration Statement). 
 
c. Payments by the Company. The Company shall use its best efforts to obtain effectiveness of the Registration
Statement as soon as practicable, but in any event not later than the one hundred twentieth (120th) day after the Closing Date (the “Registration Deadline”). If (i) the Registration Statement(s) covering the Registrable Securities
required to be filed by the Company pursuant to Section 2(a) hereof is not declared effective by the SEC by the Registration Deadline, or (ii) after the Registration Statement has been declared effective by the SEC, sales of all of the Registrable
Securities cannot be made pursuant to the Registration Statement, or (iii) the Common Stock is not listed or included for quotation on the New York Stock Exchange (the “NYSE”) (any such event described in the preceding clauses (i),
(ii) or (iii), a “Registration Default”), then the Company agrees to pay in cash liquidated damages (the “Liquidated Damages”) to each Investor, with respect to the first 90-day period immediately following the
occurrence of the Registration Default in an amount equal to $.05 per week per $1,000 principal amount of the Debentures held by such Investor. The amount of the Liquidated Damages will increase by an additional $.05 per week per $1,000 principal
amount of the Debentures with respect to each subsequent 90-day period until all Registration Defaults have been cured, up to a maximum amount of Liquidated Damages of $.20 per week per $1,000 principal amount of the Debentures. All accrued
Liquidated Damages will be paid by the Company on each date on which interest on the Debentures is otherwise payable. At the option of the Company or the Investors, upon written notice to the other party, the Company or the Investors shall have the
right to deliver or receive in lieu of cash payment on any Liquidated Damages then due and owing the number of shares of Common Stock equal to the Liquidated Damages then due and owing divided by the Conversion Price (as defined in the Debentures).
Following the cure of all Registration Defaults, the accrual of Liquidated Damages will cease; provided, however, that there shall be excluded from such period any delays which are solely 
 

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attributable to changes
required by the Investors in the Registration Statement with respect to information relating to the Investors, including, without limitation, changes to the plan of distribution, or to the failure of the Investors to conduct their review of the
Registration Statement pursuant to Section 3(h) below in a reasonably prompt manner. 
 
d. Piggy-Back Registrations. Subject to the last sentence of this Section 2(d), if at any time prior to the expiration of the Registration Period (as hereinafter defined) the
Company shall determine to file with the SEC a Registration Statement relating to an offering for its own account or the account of others under the 1933 Act of any of its equity securities (other than on Form S-4 or Form S-8 or their then
equivalents relating to equity securities to be issued solely in connection with any acquisition of any entity or business or equity securities issuable in connection with stock option or other employee benefit plans), the Company shall send to each
Investor who is entitled to registration rights under this Section 2(d) written notice of such determination and, if within ten (10) calendar days after the effective date of such notice, such Investor shall so request in writing, the Company shall
include in such Registration Statement all or any part of the Registrable Securities such Investor requests to be registered, except that if, in connection with any underwritten public offering for the account of the Company the managing
underwriter(s) thereof shall impose a limitation on the number of shares of Common Stock which may be included in the Registration Statement because, in such underwriter(s)’ judgment, marketing or other factors dictate such limitation is
necessary to facilitate public distribution, then the Company shall be obligated to include in such Registration Statement only such limited portion of the Registrable Securities with respect to which such Investor has requested inclusion hereunder
as the underwriter shall permit. Any exclusion of Registrable Securities shall be made pro rata among the Investors seeking to include Registrable Securities in proportion to the number of Registrable Securities sought to be included by such
Investors; provided, however, that the Company shall not exclude any Registrable Securities unless the Company has first excluded all outstanding securities, the holders of which are not entitled by contract to inclusion of such
securities in such Registration Statement or are not entitled to pro rata inclusion with the Registrable Securities; and provided, further, however, that, after giving effect to the immediately preceding proviso, any exclusion
of Registrable Securities shall be made pro rata with holders of other securities having the contractual right to include such securities in the Registration Statement other than holders of securities entitled to inclusion of their securities in
such Registration Statement by reason of demand registration rights. No right to registration of Registrable Securities under this Section 2(d) shall be construed to limit any registration required under Section 2(a) hereof. If an offering in
connection with which an Investor is entitled to registration under this Section 2(d) is an underwritten offering, then each Investor whose Registrable Securities are included in such Registration Statement shall, unless otherwise agreed by the
Company, offer and sell such Registrable Securities in an underwritten offering using the same underwriter or underwriters and, subject to the provisions of this Agreement, on the same terms and conditions as other shares of Common Stock included in
such underwritten offering. Notwithstanding anything to the contrary set forth herein, the registration rights of the Investors pursuant to this Section 2(d) shall only be available in the event the Company fails to timely file, obtain effectiveness
or maintain effectiveness of any Registration Statement to be filed pursuant to Section 2(a) in accordance with the terms of this Agreement. 
 
e. Eligibility for Form S-3. The Company represents and warrants that it meets the registrant eligibility and
transaction requirements for the use of Form S-3 for 
 

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registration of the sale by the Initial Investors and any other Investors of the Registrable Securities
and the Company shall file all reports required to be filed by the Company with the SEC in a timely manner so as to maintain such eligibility for the use of Form S-3. 
 
3. OBLIGATIONS OF THE COMPANY. 
 
 
In connection with the registration of the Registrable Securities, the Company shall have the following obligations: 
 
a. The Company shall prepare promptly, and file with the SEC as soon as practicable after the Closing Date (but in no event later
than the Filing Date), a Registration Statement with respect to the number of Registrable Securities provided in Section 2(a), and thereafter use its best efforts to cause such Registration Statement relating to Registrable Securities to become
effective as soon as possible after such filing, (but in no event later than the Registration Deadline), and keep the Registration Statement effective pursuant to Rule 415 at all times until such date as is the earlier of (i) the date on which all
of the Registrable Securities have been sold and (ii) the date on which the Registrable Securities may be immediately sold to the public without registration or restriction (including without limitation as to volume by each holder thereof) under the
1933 Act (the “Registration Period”) (which shall be confirmed by an opinion of counsel of the Company or the Investors, such opinion of counsel to be reasonable satisfactory to the Company), which Registration Statement (including
any amendments or supplements thereto and prospectuses contained therein) shall not contain any untrue statement of a material fact or omit to state a material fact required to be stated therein, or necessary to make the statements therein not
misleading. 
 
b. The Company shall prepare
and file with the SEC such amendments (including post-effective amendments) and supplements to the Registration Statements and the prospectus used in connection with the Registration Statements as may be necessary to keep the Registration Statements
effective at all times during the Registration Period, and, during such period, comply with the provisions of the 1933 Act with respect to the disposition of all Registrable Securities of the Company covered by the Registration Statements until such
time as all of such Registrable Securities have been disposed of in accordance with the intended methods of disposition by the seller or sellers thereof as set forth in the Registration Statements. In the event that on any Trading Day (as defined in
the Debenture) (the “Registration Trigger Date”) the number of shares available under a Registration Statement filed pursuant to this Agreement is insufficient to cover all of the Registrable Securities issued or issuable upon
conversion of or otherwise pursuant to the Debenture (based on the Conversion Price (as defined in the Debenture) then in effect) and exercise of or otherwise pursuant to the Warrants, in each case without giving effect to any limitations on the
Investors’ ability to convert the Debenture or exercise the Warrants, the Company shall amend the Registration Statement, or file a new Registration Statement (on the short form available therefore, if applicable), or both, so as to cover one
hundred twenty percent (120%) of all of the Registrable Securities so issued or issuable (without giving effect to any limitations on conversion or exercise contained in the Debenture or Warrants, as applicable) as of the Registration Trigger Date,
in each case, as soon as practicable, but in any event within twenty (20) business days after the necessity therefor arises (based on the market price of the Common Stock and other relevant factors on which the Company reasonably elects to rely).
The Company shall use its best efforts to cause such 
 

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amendment and/or new Registration Statement to become effective as soon as practicable following the
filing thereof, but in any event within ninety (90) calendar days of the Registration Trigger Date. The provisions of Section 2(c) above shall be applicable with respect to the Company’s obligations under this Section 3(b). 
 
c. The Company shall furnish to each Investor whose
Registrable Securities are included in a Registration Statement and its legal counsel (i) promptly after the same is prepared and publicly distributed, filed with the SEC, or received by the Company, one copy of each Registration Statement and any
amendment thereto, each preliminary prospectus and prospectus and each amendment or supplement thereto, and, in the case of the Registration Statement referred to in Section 2(a), each letter written by or on behalf of the Company to the SEC or the
staff of the SEC, and each item of correspondence from the SEC or the staff of the SEC, in each case relating to such Registration Statement (other than any portion of any thereof which contains information for which the Company has sought
confidential treatment), and (ii) such number of copies of a prospectus, including a preliminary prospectus, and all amendments and supplements thereto and such other documents as such Investor may reasonably request in order to facilitate the
disposition of the Registrable Securities owned by such Investor. The Company will promptly notify each Investor by facsimile of the effectiveness of each Registration Statement or any post-effective amendment. The Company will promptly respond to
any and all comments received from the SEC, with a view towards causing each Registration Statement or any amendment thereto to be declared effective by the SEC as soon as practicable and shall file an acceleration request as soon as practicable
following the resolution or clearance of all SEC comments or, if applicable, following notification by the SEC that any such Registration Statement or any amendment thereto will not be subject to review. 
 
d. The Company shall use reasonable efforts to (i)
register and qualify the Registrable Securities covered by the Registration Statements under such other securities or “blue sky” laws of such jurisdictions in the United States as the Investors who hold a majority in interest of the
Registrable Securities being offered reasonably request, (ii) prepare and file in those jurisdictions such amendments (including post-effective amendments) and supplements to such registrations and qualifications as may be necessary to maintain the
effectiveness thereof during the Registration Period, (iii) take such other actions as may be necessary to maintain such registrations and qualifications in effect at all times during the Registration Period, and (iv) take all other actions
reasonably necessary or advisable to qualify the Registrable Securities for sale in such jurisdictions; provided, however, that the Company shall not be required in connection therewith or as a condition thereto to (a) qualify to do
business in any jurisdiction where it would not otherwise be required to qualify but for this Section 3(d), (b) subject itself to general taxation in any such jurisdiction, (c) file a general consent to service of process in any such jurisdiction,
(d) provide any undertakings that cause the Company undue expense or burden, or (e) make any change in its charter or bylaws, which in each case the Board of Directors of the Company determines to be contrary to the best interests of the Company and
its stockholders. 
 
e. In the event
Investors who hold a majority-in-interest of the Registrable Securities being offered in the offering (with the approval of the Initial Investors) select underwriters for the offering, the Company shall enter into and perform its obligations under
an underwriting agreement, in usual and customary form, including, without limitation, customary indemnification and contribution obligations, with the underwriters of such offering. 
 

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f. As
promptly as practicable after becoming aware of such event, the Company shall notify each Investor of the happening of any event, of which the Company has knowledge, as a result of which the prospectus included in any Registration Statement, as then
in effect, includes an untrue statement of a material fact or omission to state a material fact required to be stated therein or necessary to make the statements therein not misleading, and use its best efforts promptly to prepare a supplement or
amendment to any Registration Statement to correct such untrue statement or omission, and deliver such number of copies of such supplement or amendment to each Investor as such Investor may reasonably request. 
 
g. The Company shall use its best efforts to prevent
the issuance of any stop order or other suspension of effectiveness of any Registration Statement, and, if such an order is issued, to obtain the withdrawal of such order at the earliest possible moment and to notify each Investor who holds
Registrable Securities being sold (or, in the event of an underwritten offering, the managing underwriters) of the issuance of such order and the resolution thereof. 
 
h. The Company shall permit a single firm of counsel designated by the Initial Investors to review and
comment upon such Registration Statement, and all amendments and supplements thereto (as well as all requests for acceleration or effectiveness thereof and any correspondence between the Company and the SEC relating to the Registration Statement)
(collectively, the “Registration Documents”), a reasonable period of time (not to exceed three (3) business days) prior to their filing with the SEC. The Company agrees that it will, and it will cause its counsel to, consider in good faith
any comments or objections from counsel selected by the Initial Investors as to the form or content of such Registration Statement or such amendments or supplements thereto. The sections of such Registration Statement covering information with
respect to the Investors, the Investors’ beneficial ownership of securities of the Company or the Investors intended method of disposition of Registrable Securities shall conform to the information provided to the Company by each of the
Investors. 
 
i. The Company shall make
generally available to its security holders as soon as practicable, but not later than ninety (90) calendar days after the close of the period covered thereby, an earnings statement (in form complying with the provisions of Rule 158 under the 1933
Act) covering a twelve-month period beginning not later than the first day of the Company’s fiscal quarter next following the effective date of the Registration Statement. 
 
j. At the request of any Investor, the Company shall furnish, on the date that Registrable Securities
are delivered to an underwriter, if any, for sale in connection with any Registration Statement or, if such securities are not being sold by an underwriter, on the date of effectiveness thereof (i) an opinion, dated as of such date, from counsel
representing the Company for purposes of such Registration Statement, in form, scope and substance as is customarily given in an underwritten public offering, addressed to the underwriters, if any, and the Investors and (ii) a letter, dated such
date, from the Company’s independent certified public accountants in form and substance as is customarily given by independent certified public accountants to underwriters in an underwritten public offering, addressed to the underwriters, if
any, and the Investors. 
 
k. The Company
shall make available for inspection by (i) any Investor, (ii) any underwriter participating in any disposition pursuant to a Registration Statement, (iii) one 
 

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firm of attorneys and one firm
of accountants or other agents retained by the Initial Investors, and (iv) one firm of attorneys retained by all such underwriters (collectively, the “Inspectors”) all pertinent financial and other records, and pertinent corporate
documents and properties of the Company (collectively, the “Records”), as shall be reasonably deemed necessary by each Inspector to enable each Inspector to exercise its due diligence responsibility, and cause the Company’s
officers, directors and employees to supply all information which any Inspector may reasonably request for purposes of such due diligence; provided, however, that each Inspector shall hold in confidence and shall not make any
disclosure (except to an Investor) of any Record or other information which the Company determines in good faith to be confidential, and of which determination the Inspectors are so notified, unless (a) the disclosure of such Records is necessary to
avoid or correct a misstatement or omission in any Registration Statement, (b) the release of such Records is ordered pursuant to a subpoena or other order from a court or government body of competent jurisdiction, or (c) the information in such
Records has been made generally available to the public other than by disclosure in violation of this or any other agreement. The Company shall not be required to disclose any confidential information in such Records to any Inspector until and
unless such Inspector shall have entered into confidentiality agreements (in form and substance satisfactory to the Company) with the Company with respect thereto, substantially in the form of this Section 3(k). Each Investor agrees that it shall,
upon learning that disclosure of such Records is sought in or by a court or governmental body of competent jurisdiction or through other means, give prompt notice to the Company and allow the Company, at its expense, to undertake appropriate action
to prevent disclosure of, or to obtain a protective order for, the Records deemed confidential. Nothing herein (or in any other confidentiality agreement between the Company and any Investor) shall be deemed to limit the Investor’s ability to
sell Registrable Securities in a manner which is otherwise consistent with applicable laws and regulations. 
 
l. The Company shall hold in confidence and not make any disclosure of information concerning an Investor provided to the Company
unless (i) disclosure of such information is necessary to comply with federal or state securities laws, (ii) the disclosure of such information is necessary to avoid or correct a misstatement or omission in any Registration Statement, (iii) the
release of such information is ordered pursuant to a subpoena or other order from a court or governmental body of competent jurisdiction, or (iv) such information has been made generally available to the public other than by disclosure in violation
of this or any other agreement. The Company agrees that it shall, upon learning that disclosure of such information concerning an Investor is sought in or by a court or governmental body of competent jurisdiction or through other means, give prompt
notice to such Investor prior to making such disclosure, and allow the Investor, at its expense, to undertake appropriate action to prevent disclosure of, or to obtain a protective order for, such information. 
 
m. The Company shall (i) cause all the Registrable
Securities covered by the Registration Statement to be listed on the NYSE. 
 
n. The Company shall provide a transfer agent and registrar, which may be a single entity, for the Registrable Securities not later than the effective date of the Registration Statement.

 

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o. The
Company shall cooperate with the Investors who hold Registrable Securities being offered and the managing underwriter or underwriters, if any, to facilitate the timely preparation and delivery of certificates (not bearing any restrictive legends)
representing Registrable Securities to be offered pursuant to such Registration Statement and enable such certificates to be in such denominations or amounts, as the case may be, as the managing underwriter or underwriters, if any, or the Investors
may reasonably request and registered in such names as the managing underwriter or underwriters, if any, or the Investors may request, and, within three (3) business days after a Registration Statement which includes Registrable Securities is
ordered effective by the SEC, the Company shall deliver, and shall cause legal counsel selected by the Company to deliver, to the transfer agent for the Registrable Securities (with copies to the Investors whose Registrable Securities are included
in such Registration Statement) an instruction in the form attached hereto as Exhibit 1 and an opinion of such counsel in the form attached hereto as Exhibit 2. 
 
p. At the request of the holders of a majority-in-interest of the Registrable Securities, the Company
shall prepare and file with the SEC such amendments (including post-effective amendments) and supplements to a Registration Statement and any prospectus used in connection with the Registration Statement as may be necessary in order to change the
plan of distribution set forth in such Registration Statement. 
 
q. The Company shall not, and shall not agree to, allow the holders of any securities of the Company to include any of their securities in any Registration Statement under Section 2(a) hereof or any amendment or supplement
thereto under Section 3(b) hereof without the consent of the holders of a majority-in-interest of the Registrable Securities. In addition, the Company shall not offer any securities for its own account or the account of others in any Registration
Statement under Section 2(a) hereof or any amendment or supplement thereto under Section 3(b) hereof without the consent of the holders of a majority-in-interest of the Registrable Securities. 
 
r. The Company shall take all other reasonable actions
necessary to expedite and facilitate disposition by the Investors of Registrable Securities pursuant to a Registration Statement. 
 
s. The Company shall comply with all applicable laws related to a Registration Statement and offering and sale of securities and
all applicable rules and regulations of governmental authorities in connection therewith (including without limitation the 1933 Act and the 1934 Act and the rules and regulations promulgated by the SEC). 
 
t. Notwithstanding anything to the contrary herein, at
any time after the Registration Statement has been declared effective by the SEC, the Company may suspend the use or effectiveness of the Registration Statement if (i) in the good faith judgement of the Company the effectiveness of the Registration
Statement would require premature disclosure of material information relating to a pending corporate development or (ii) an event occurs and is continuing as a result of which the Registration Statement would, in the good faith judgement of the
Company, contain an untrue statement of material fact or omit to state a material fact necessary in order to make the statements therein, in light of the circumstances under which they were made, not misleading and in any such event the Company may
delay the disclosure of 
 

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material non-public
information concerning the Company the disclosure of which at the time is not, in the good faith judgement of the Company, in the best interests of the Company (clauses (i) and (ii) together, a “Grace Period”); provided, that the Company
shall promptly (i) notify the Investors in writing of the existence of such event or of such material non-public information giving rise to a Grace Period (provided that in each notice the Company will not disclose the content of such material
non-public information to the Investors) and the date on which the Grace Period will begin, and (ii) notify the Investors in writing of the date on which the Grace Period ends; and, provided further, that during any three hundred sixty five (365)
day period no more than two such Grace Periods shall be permitted and such Grace Periods shall not exceed an aggregate of ninety (90) days (an “Allowable Grace Period”). For purposes of determining the length of a Grace Period above, the
Grace Period shall begin on and include the date the Investors receive the notice referred to in clause (i) and shall end on and include the later of the date the Investors receive the notice referred to in clause (ii) and the date referred to in
such notice. The provisions of Section 3(g) hereof shall not be applicable during the period of any Allowable Grace Period. Upon expiration of the Grace Period, the Company shall again be bound by the first sentence of Section 3(f) with respect to
the information giving rise thereto unless such material non-public information is no longer applicable. Each Investor agrees, if (i) timely requested by the Company in writing in an underwritten sale of securities of the Company and (ii) either (A)
at the time of the receipt of such written request an Investor is represented on the Board of Directors of the Company or (B) the Investors, taken as a whole, own directly or beneficially more than 10% of the Company’s Common Stock, not to make
any public sale or distribution under the 1933 Act of any Registrable Securities (except as part of such registration), during the time period reasonably requested by the sole or lead managing underwriter not to exceed ninety (90) days (the
“Black-out Period”). Notwithstanding the foregoing, in no event shall all Grace Periods and/or Black-out Periods in any three hundred sixty five (365) day period exceed a total of ninety (90) days. 
 
4. OBLIGATIONS OF THE INVESTORS. 
 
In connection with the registration of the Registrable
Securities, the Investors shall have the following obligations: 
 
a. It shall be a condition precedent to the obligations of the Company to complete the registration pursuant to this Agreement with respect to the Registrable Securities of a particular Investor that such Investor shall
furnish to the Company such information regarding itself, the Registrable Securities held by it and the intended method of disposition of the Registrable Securities held by it as shall be reasonably required to effect the registration of such
Registrable Securities and shall execute such documents in connection with such registration as the Company may reasonably request. At least three (3) business days prior to the first anticipated filing date of the Registration Statement, the
Company shall notify each Investor of the information the Company requires from each such Investor. 
 
b. Each Investor, by such Investor’s acceptance of the Registrable Securities, agrees to cooperate with the Company as
reasonably requested by the Company in connection with the preparation and filing of the Registration Statements hereunder, unless such Investor has notified the Company in writing of such Investor’s election to exclude all of such
Investor’s Registrable Securities from the Registration Statements. 
 

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c. In
the event Investors holding a majority-in-interest of the Registrable Securities being registered (with the approval of the Initial Investors) determine to engage the services of an underwriter, each Investor agrees to enter into and perform such
Investor’s obligations under an underwriting agreement, in usual and customary form, including, without limitation, customary indemnification and contribution obligations, with the managing underwriter of such offering and take such other
actions as are reasonably required in order to expedite or facilitate the disposition of the Registrable Securities, unless such Investor has notified the Company in writing of such Investor’s election to exclude all of such Investor’s
Registrable Securities from such Registration Statement. 
 
d. Each Investor agrees that, upon receipt of any notice from the Company of the happening of any event of the kind described in Section 3(f) or 3(g), such Investor will immediately discontinue disposition of Registrable
Securities pursuant to the Registration Statement covering such Registrable Securities until such Investor’s receipt of the copies of the supplemented or amended prospectus contemplated by Section 3(f) or 3(g) and, if so directed by the
Company, such Investor shall deliver to the Company (at the expense of the Company) or destroy (and deliver to the Company a certificate of destruction) all copies in such Investor’s possession, of the prospectus covering such Registrable
Securities current at the time of receipt of such notice. 
 
e. No Investor may participate in any underwritten registration hereunder unless such Investor (i) agrees to sell such Investor’s Registrable Securities on the basis provided in any underwriting arrangements in usual and
customary form entered into by the Company, (ii) completes and executes all questionnaires, powers of attorney, indemnities, underwriting agreements and other documents reasonably required under the terms of such underwriting arrangements, and (iii)
agrees to pay its pro rata share of all underwriting discounts and commissions and any expenses in excess of those payable by the Company pursuant to Section 5 below. 
 
5. EXPENSES OF REGISTRATION. 
 
All reasonable expenses, other than underwriting discounts and commissions, incurred in connection with
registrations, filings or qualifications pursuant to Sections 2 and 3, including, without limitation, all registration, listing and qualification fees, printers and accounting fees, the fees and disbursements of counsel for the Company, and the
reasonable fees and disbursements of one counsel selected by the Initial Investors pursuant to Sections 2(b) and 3(h) hereof shall be borne by the Company, subject however to the reimbursement limitations set forth in Section 4(e) of the Securities
Purchase Agreement. 
 
6.
INDEMNIFICATION. 
 
In the event any
Registrable Securities are included in a Registration Statement under this Agreement: 
 
a. To the extent permitted by law, the Company will indemnify, hold harmless and defend (i) each Investor who holds such Registrable Securities, (ii) the directors, officers, partners,
employees, agents and each person who controls any Investor within the 
 

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meaning of the 1933 Act or the
Securities Exchange Act of 1934, as amended (the “1934 Act”), if any, (iii) any underwriter (as defined in the 1933 Act) for the Investors, and (iv) the directors, officers, partners, employees and each person who controls any such
underwriter within the meaning of the 1933 Act or the 1934 Act, if any (each, an “Indemnified Person”), against any joint or several losses, claims, damages, liabilities or expenses (collectively, together with actions, proceedings
or inquiries by any regulatory or self-regulatory organization, whether commenced or threatened, in respect thereof, “Claims”) to which any of them may become subject insofar as such Claims arise out of or are based upon: (i) any
untrue statement or alleged untrue statement of a material fact in a Registration Statement or the omission or alleged omission to state therein a material fact required to be stated or necessary to make the statements therein not misleading; (ii)
any untrue statement or alleged untrue statement of a material fact contained in any preliminary prospectus if used prior to the effective date of such Registration Statement, or contained in the final prospectus (as amended or supplemented, if the
Company files any amendment thereof or supplement thereto with the SEC) or the omission or alleged omission to state therein any material fact necessary to make the statements made therein, in light of the circumstances under which the statements
therein were made, not misleading; or (iii) any violation or alleged violation by the Company of the 1933 Act, the 1934 Act, any other law, including, without limitation, any state securities law, or any rule or regulation thereunder relating to the
offer or sale of the Registrable Securities (the matters in the foregoing clauses (i) through (iii) being, collectively, “Violations”). Subject to the restrictions set forth in Section 6(c) with respect to the number of legal
counsel, the Company shall reimburse the Indemnified Person, promptly as such expenses are incurred and are due and payable, for any reasonable legal fees or other reasonable expenses incurred by them in connection with investigating or defending
any such Claim. Notwithstanding anything to the contrary contained herein, the indemnification agreement contained in this Section 6(a): (i) shall not apply to a Claim arising out of or based upon a Violation which occurs in reliance upon and in
conformity with information furnished in writing to the Company by any Indemnified Person or underwriter for such Indemnified Person expressly for use in connection with the preparation of such Registration Statement or any such amendment thereof or
supplement thereto; (ii) shall not apply to amounts paid in settlement of any Claim if such settlement is effected without the prior written consent of the Company, which consent shall not be unreasonably withheld; and (iii) with respect to any
preliminary prospectus, shall not inure to the benefit of any Indemnified Person if the untrue statement or omission of material fact contained in the preliminary prospectus was corrected on a timely basis in the prospectus, as then amended or
supplemented, such corrected prospectus was timely made available by the Company pursuant to Section 3(c) hereof, and the Indemnified Person was promptly advised in writing not to use the incorrect prospectus prior to the use giving rise to a
Violation and such Indemnified Person, notwithstanding such advice, used it. Such indemnity shall remain in full force and effect regardless of any investigation made by or on behalf of the Indemnified Person and shall survive the transfer of the
Registrable Securities by the Investors pursuant to Section 9. 
 
b. In connection with any Registration Statement in which an Investor is participating, each such Investor agrees severally and not jointly to indemnify, hold harmless and defend, to the same extent and in the same manner set
forth in Section 6(a), the Company, each of its directors, each of its officers who signs the Registration Statement, each person, if any, who controls the Company within the meaning of the 1933 Act or the 1934 Act, any underwriter and any other
stockholder selling securities pursuant to the Registration Statement or any of its 
 

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directors or officers or any
person who controls such stockholder or underwriter within the meaning of the 1933 Act or the 1934 Act (collectively and together with an Indemnified Person, an “Indemnified Party”), against any Claim to which any of them may become
subject, under the 1933 Act, the 1934 Act or otherwise, insofar as such Claim arises out of or is based upon any Violation by such Investor, in each case to the extent (and only to the extent) that such Violation occurs in reliance upon and in
conformity with written information furnished to the Company by such Investor expressly for use in connection with such Registration Statement; and subject to Section 6(c), such Investor will reimburse any legal or other expenses (promptly as such
expenses are incurred and are due and payable) reasonably incurred by them in connection with investigating or defending any such Claim; provided, however, that the indemnity agreement contained in this Section 6(b) shall not apply to
amounts paid in settlement of any Claim if such settlement is effected without the prior written consent of such Investor, which consent shall not be unreasonably withheld; provided, further, however, that the Investor shall be
liable under this Agreement (including this Section 6(b) and Section 7) for only that amount as does not exceed the net proceeds to such Investor as a result of the sale of Registrable Securities pursuant to such Registration Statement. Such
indemnity shall remain in full force and effect regardless of any investigation made by or on behalf of such Indemnified Party and shall survive the transfer of the Registrable Securities by the Investors pursuant to Section 9. Notwithstanding
anything to the contrary contained herein, the indemnification agreement contained in this Section 6(b) with respect to any preliminary prospectus shall not inure to the benefit of any Indemnified Party if the untrue statement or omission of
material fact contained in the preliminary prospectus was corrected on a timely basis in the prospectus, as then amended or supplemented. 
 
c. Promptly after receipt by an Indemnified Person or Indemnified Party under this Section 6 of notice of the commencement of any
action (including any governmental action), such Indemnified Person or Indemnified Party shall, if a Claim in respect thereof is to be made against any indemnifying party under this Section 6, deliver to the indemnifying party a written notice of
the commencement thereof, and the indemnifying party shall have the right to participate in, and, to the extent the indemnifying party so desires, jointly with any other indemnifying party similarly noticed, to assume control of the defense thereof
with counsel mutually satisfactory to the indemnifying party and the Indemnified Person or the Indemnified Party, as the case may be; provided, however, that an Indemnified Person or Indemnified Party shall have the right to retain its
own counsel with the fees and expenses to be paid by the indemnifying party, if, in the reasonable opinion of counsel retained by the indemnifying party, the representation by such counsel of the Indemnified Person or Indemnified Party and the
indemnifying party would be inappropriate due to actual or potential differing interests between such Indemnified Person or Indemnified Party and any other party represented by such counsel in such proceeding. The indemnifying party shall pay for
only one separate legal counsel for the Indemnified Persons or the Indemnified Parties, as applicable, and such legal counsel shall be selected by Investors holding a majority-in-interest of the Registrable Securities included in the Registration
Statement to which the Claim relates (with the approval of a majority-in-interest of the Initial Investors), if the Investors are entitled to indemnification hereunder, or the Company, if the Company is entitled to indemnification hereunder, as
applicable. The failure to deliver written notice to the indemnifying party within a reasonable time of the commencement of any such action shall not relieve such indemnifying party of any liability to the Indemnified Person or Indemnified Party
under this Section 6, except to the extent that the indemnifying party is actually prejudiced in its ability to defend such action. The indemnification required by this 
 

13 








 
Section 6 shall be made by
periodic payments of the amount thereof during the course of the investigation or defense, as such expense, loss, damage or liability is incurred and is due and payable. 
 
7. CONTRIBUTION. 
 
To the extent any indemnification by an indemnifying party is prohibited or limited by law, the indemnifying
party agrees to make the maximum contribution with respect to any amounts for which it would otherwise be liable under Section 6 to the fullest extent permitted by law; provided, however, that (i) no contribution shall be made under
circumstances where the maker would not have been liable for indemnification under the fault standards set forth in Section 6, (ii) no seller of Registrable Securities guilty of fraudulent misrepresentation (within the meaning of Section 11(f) of
the 1933 Act) shall be entitled to contribution from any seller of Registrable Securities who was not guilty of such fraudulent misrepresentation, and (iii) contribution (together with any indemnification or other obligations under this Agreement)
by any seller of Registrable Securities shall be limited in amount to the net amount of proceeds received by such seller from the sale of such Registrable Securities. 
 
8. REPORTS UNDER THE 1934 ACT. 
 
With a view to making available to the Investors the benefits
of Rule 144 promulgated under the 1933 Act or any other similar rule or regulation of the SEC that may at any time permit the investors to sell securities of the Company to the public without registration (“Rule 144”), the Company
agrees to: 
 
a. make and keep public
information available, as those terms are understood and defined in Rule 144; 
 
b. file with the SEC in a timely manner all reports and other documents required of the Company under the 1933 Act and the 1934 Act so long as the Company remains subject to such requirements
(it being understood that nothing herein shall limit the Company’s obligations under Section 4(c) of the Securities Purchase Agreement) and the filing of such reports and other documents is required for the applicable provisions of Rule 144;
and 
 
c. furnish to each Investor so long
as such Investor owns Registrable Securities, promptly upon request, (i) a written statement by the Company that it has complied with the reporting requirements of Rule 144, the 1933 Act and the 1934 Act, (ii) a copy of the most recent annual or
quarterly report of the Company and such other reports and documents so filed by the Company, and (iii) such other information as may be reasonably requested to permit the Investors to sell such securities pursuant to Rule 144 without registration.

 
9. ASSIGNMENT OF REGISTRATION RIGHTS.

 
The rights under this Agreement shall be
automatically assignable by the Investors to any transferee of all or any portion of Registrable Securities if: (i) the Investor agrees in writing with the transferee or assignee to assign such rights, and a copy of such agreement is furnished to
the Company within a reasonable time after such assignment, (ii) the Company is prior to such transfer or assignment, furnished with written notice of (a) the name and address of such 
 

14 








 
transferee or assignee, and
(b) the securities with respect to which such registration rights are being transferred or assigned, (iii) following such transfer or assignment, the further disposition of such securities by the transferee or assignee is restricted under the 1933
Act and applicable state securities laws, (iv) at or before the time the Company receives the written notice contemplated by clause (ii) of this sentence, the transferee or assignee agrees in writing with the Company to be bound by all of the
provisions contained herein, (v) such transfer shall have been made in accordance with the applicable requirements of the Securities Purchase Agreement, and (vi) such transferee shall be an “accredited investor” as that term defined
in Rule 501 of Regulation D promulgated under the 1933 Act. 
 
10. AMENDMENT OF REGISTRATION RIGHTS. 
 
Provisions of this Agreement may be amended and the observance thereof may be waived (either generally or in a particular instance and either retroactively or prospectively), only with written consent of the Company, the
Initial Investors (to the extent the Initial Investors still own Registrable Securities) and Investors who hold a majority interest of the Registrable Securities. Any amendment or waiver effected in accordance with this Section 10 shall be binding
upon each Investor and the Company. 
 
11.
MISCELLANEOUS. 
 
a. A person or
entity is deemed to be a holder of Registrable Securities whenever such person or entity owns of record such Registrable Securities. If the Company receives conflicting instructions, notices or elections from two or more persons or entities with
respect to the same Registrable Securities, the Company shall act upon the basis of instructions, notice or election received from the registered owner of such Registrable Securities. 
 
b. Any notices required or permitted to be given under the terms hereof shall be sent by certified or
registered mail (return receipt requested) or delivered personally or by courier (including a recognized overnight delivery service) or by facsimile and shall be effective five (5) calendar days after being placed in the mail, if mailed by regular
United States mail, or upon receipt, if delivered personally or by courier (including a recognized overnight delivery service) or by facsimile, in each case addressed to a party. The addresses for such communications shall be: 
 
If to the Company: 
 
K2 Inc. 
4900 South Eastern Avenue 
Los Angeles, California 90040 
Attention: Chief Financial
Officer 
Facsimile: (323) 724-0470 
 
With copy to: 
 
Gibson, Dunn & Crutcher LLP 
333 South Grand Avenue 
Los Angeles, California 90071 
 

15 








 
Attention: Andy Bogen, Esq. 
Facsimile: (213) 229-7520 
 
If to an Investor: to the address set forth immediately below such
Investor’s name on the signature pages to the Securities Purchase Agreement. 
 
With copy to: 
 
Martin T. Schrier, Esq. 
Akerman, Senterfitt & Eidson, P.A. 
One Southeast Third
Avenue 
Miami, Florida 33131 
Facsimile: (305) 374-5095 
 
c. Failure of any party to exercise any right or remedy under this Agreement or otherwise, or delay by a party in exercising such
right or remedy, shall not operate as a waiver thereof. 
 
d. This Agreement shall be governed by and construed in accordance with the laws of the State of New York applicable to agreements made and to be performed in the State of New York (without regard to principles of conflict of
laws). Both parties irrevocably consent to the exclusive jurisdiction of the United States federal courts and the state courts located in the City of New York, Borough of Manhattan, with respect to any suit or proceeding based on or arising under
this Agreement, the agreements entered into in connection herewith or the transactions contemplated hereby or thereby and irrevocably agree that all claims in respect of such suit or proceeding may be determined in such courts. Both parties
irrevocably waive the defense of an inconvenient forum to the maintenance of such suit or proceeding. Both parties further agree that service of process upon a party mailed by first class mail shall be deemed in every respect effective service of
process upon the party in any such suit or proceeding. Nothing herein shall affect either party’s right to serve process in any other manner permitted by law. Both parties agree that a final non-appealable judgment in any such suit or
proceeding shall be conclusive and may be enforced in other jurisdictions by suit on such judgment or in any other lawful manner. 
 
e. This Agreement and the Securities Purchase Agreement (including all schedules and exhibits thereto) constitute the entire
agreement among the parties hereto with respect to the subject matter hereof and thereof. There are no restrictions, promises, warranties or undertakings, other than those set forth or referred to herein and therein. This Agreement and the
Securities Purchase Agreement supersede all prior agreements and understandings among the parties hereto with respect to the subject matter hereof and thereof. 
 
f. Subject to the requirements of Section 9 hereof, this Agreement shall inure to the benefit of and be binding upon the successors
and assigns of each of the parties hereto. 
 
g.
The headings in this Agreement are for convenience of reference only and shall not limit or otherwise affect the meaning hereof. 
 

16 








 
h. This
Agreement may be executed in two or more counterparts, each of which shall be deemed an original but all of which shall constitute one and the same agreement. This Agreement, once executed by a party, may be delivered to the other party hereto by
facsimile transmission of a copy of this Agreement bearing the signature of the party so delivering this Agreement. 
 
i. Each party shall do and perform, or cause to be done and performed, all such further acts and things, and shall execute and
deliver all such other agreements, certificates, instruments and documents, as the other party may reasonably request in order to carry out the intent and accomplish the purposes of this Agreement and the consummation of the transactions
contemplated hereby. 
 
j. Except as
otherwise provided herein, all consents and other determinations to be made by the Investors pursuant to this Agreement shall be made by Investors holding a majority of the Registrable Securities, determined as if the all of the Debenture then
outstanding have been converted into for Registrable Securities. 
 
k. The Company acknowledges that a breach by it of its obligations hereunder will cause irreparable harm to each Investor by vitiating the intent and purpose of the transactions contemplated hereby. Accordingly, the Company
acknowledges that the remedy at law for breach of its obligations hereunder will be inadequate and agrees, in the event of a breach or a threatened breach in writing by the Company of any of the provisions hereunder, that each Investor shall be
entitled, in addition to all other available remedies in law or in equity, to an injunction or injunctions to prevent or cure breaches of the provisions of this Agreement and to enforce specifically the terms and provisions hereof, without the
necessity of showing economic loss and without any bond or other security being required. 
 
l. The language used in this Agreement will be deemed to be the language chosen by the parties to express their mutual intent, and no rules of strict construction will be applied against any
party. 
 
m. In the event that any provision
of this Agreement is invalid or unenforceable under any applicable statute or rule of law, then such provision shall be deemed inoperative to the extent that it may conflict therewith and shall be deemed modified to conform with such statute or rule
of law. Any provision hereof which may prove invalid or unenforceable under any law shall not affect the validity or enforceability of any other provision hereof. 
 
n. The initial number of Registrable Securities included in any Registration Statement and each
increase to the number of Registrable Securities included therein shall be allocated pro rata among the Investors based on the number of Registrable Securities held by each Investor at the time of such establishment or increase, as the case may be.
In the event an Investor shall sell or otherwise transfer any of such holder’s Registrable Securities, each transferee shall be allocated a pro rata portion of the number of Registrable Securities included in a Registration Statement for such
transferor. Any shares of Common Stock included on a Registration Statement and which remain allocated to any person or entity which does not hold any Registrable Securities shall be allocated to the remaining Investors, pro rata based on the number
of shares of Registrable Securities then held by such Investors. For the avoidance of 
 

17 








 
doubt, the number of
Registrable Securities held by an Investor shall be determined as if all Debenture and Warrants then outstanding and held by an Investor were converted into or exercised for Registrable Securities. 
 
[REMAINDER OF THIS PAGE INTENTIONALLY LEFT BLANK] 
 

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IN WITNESS
WHEREOF, the Company and the undersigned Initial Investors have caused this Agreement to be duly executed as of the date first above written. 
 

	 K2 Inc.

	
	 By:
	 	  
 /s/ John J. Rangel


	 Name:
	 	 John J. Rangel

	 Title:
	 	 Senior Vice President—Finance



 

	 SPORTING GOODS INVESTMENT I, LP

	
	 By:
	 	 K-1 USA VENTURES, INC.,
 its sole general partner

	 	 	 


 

	 
	
	 By:
	 	  


	 	 	 Name:
 Title:



 

	 SPORTING GOODS INVESTMENT II, LP

	
	 By:
	 	 K-1 HOLDINGS EQUITY I, INC.,
 its general partner

	 	 	 


 

	 
	
	 By:
	 	  


	 	 	 Name:
 Title:



 

19