Exhibit 1.1
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INTERNET CAPITAL GROUP, INC.
(A Delaware corporation)
4,800,000 Shares of Common Stock
U.S. PURCHASE AGREEMENT
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Dated: , 1999
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TABLE OF CONTENTS
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U.S. PURCHASE AGREEMENT
SECTION 1. Representations and Warranties.........................................4
(a) Representations and Warranties by the Company......................4
(i) Compliance with Registration Requirements.........4
(ii) Independent Accountants...........................5
(iii) Financial Statements..............................5
(iv) No Material Adverse Change in Business............6
(v) Good Standing of the Company......................6
(vi) Good Standing of Subsidiaries and Material
Holdings..........................................7
(vii) Capitalization....................................7
(viii) Authorization of Agreements.......................8
(ix) Authorization and Description of Securities and
Convertible Notes.................................8
(x) Absence of Defaults and Conflicts.................8
(xi) Absence of Labor Dispute..........................9
(xii) Absence of Proceedings............................9
(xiii) Accuracy of Exhibits.............................10
(xiv) Possession of Intellectual Property..............10
(xv) Absence of Further Requirements..................10
(xvi) Possession of Licenses and Permits...............11
(xvii) Title to Property................................11
(xviii) Investment Company Act...........................11
(xix) Environmental Laws...............................12
(xx) Registration Rights..............................12
(xxi) Year 2000. ......................................12
SECTION 2. Sale and Delivery to U.S. Underwriters; Closing.......................13
(a) Initial Securities................................................13
(b) Option Securities.................................................13
(c) Payment...........................................................14
(d) Denominations; Registration.......................................14
SECTION 3. Covenants of the Company..............................................15
(a) Compliance with Securities Regulations and Commission
Requests. ........................................................15
(b) Filing of Amendments..............................................15
(c) Delivery of Registration Statements...............................16
(d) Delivery of Prospectuses..........................................16
(e) Continued Compliance with Securities Laws.........................16
(f) Blue Sky Qualifications...........................................17
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(g) Rule 158.......................................................17
(h) Use of Proceeds................................................17
(i) Listing........................................................17
(j) Restriction on Sale of Securities..............................17
(k) Reporting Requirements.........................................18
(l) Compliance with Rule 463.......................................18
SECTION 4. Payment of Expenses................................................18
(a) Expenses.......................................................18
(b) Termination of Agreement.......................................19
SECTION 5. Conditions of U.S. Underwriters' Obligations.......................19
(a) Effectiveness of Registration Statement........................19
(b) Opinions of Counsel for Company................................19
(c) Opinion of Counsel for U.S. Underwriters.......................20
(d) Officers' Certificate..........................................20
(e) Accountant's Comfort Letters...................................20
(f) Bring-down Comfort Letter......................................21
(g) No Objection...................................................21
(h) Lock-up Agreements.............................................21
(i) Purchase of Initial International Securities...................21
(j) Conditions to Purchase of U.S. Option Securities...............21
(i) Officers' Certificate............................21
(ii) Opinion of Counsel for Company...................21
(iii) Opinion of Special 1940 Act Counsel..............22
(iv) Opinion of Counsel for U.S. Underwriters.........22
(v) Bring-down Comfort Letter........................22
SECTION 6. Indemnification....................................................23
(a) Indemnification of U.S. Underwriters...........................23
(b) Indemnification of Company, Directors and Officers.............24
(c) Actions against Parties; Notification..........................24
(d) Settlement without Consent if Failure to Reimburse.............25
SECTION 7. Contribution.......................................................25
SECTION 8. Representations, Warranties and Agreements to Survive Delivery.....27
SECTION 9. Termination of Agreement...........................................27
(a) Termination; General...........................................27
(b) Liabilities....................................................27
SECTION 10. Default by One or More of the U.S. Underwriters...................28
SECTION 11. Notices...........................................................28
SECTION 12. Parties...........................................................29
SECTION 13. GOVERNING LAW AND TIME............................................29
SECTION 14. Effect of Headings................................................29
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SCHEDULE A ..............................................................Sch A-1
SCHEDULE B...............................................................Sch B-1
SCHEDULE C...............................................................Sch C-1
Exhibit A................................................................Ex. A-1
Exhibit B................................................................Ex. B-1
Exhibit C................................................................Ex. C-1
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INTERNET CAPITAL GROUP, INC.
(A Delaware corporation)
4,800,000 Shares of Common Stock
(Par Value $.001 Per Share)
U.S. PURCHASE AGREEMENT
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, 1999
XXXXXXX XXXXX & CO.
Xxxxxxx Lynch, Pierce, Xxxxxx & Xxxxx
Incorporated
Xxxxxxx, Sachs & Co.
Deutsche Bank Securities Inc.
Xxxxxx Brothers Inc.
BancBoston Xxxxxxxxx Xxxxxxxx Inc.
as U.S. Representatives of the several U.S. Underwriters
x/x Xxxxxxx Xxxxx & Xx.
Xxxxxxx Lynch, Pierce, Xxxxxx & Xxxxx
Incorporated
Xxxxx Xxxxx
Xxxxx Xxxxxxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000-0000
Ladies and Gentlemen:
Internet Capital Group, Inc., a Delaware corporation (the "Company"),
confirms its agreement with Xxxxxxx Xxxxx & Co., Xxxxxxx Lynch, Pierce, Xxxxxx &
Xxxxx Incorporated ("Xxxxxxx Xxxxx") and each of the other U.S. Underwriters
named in Schedule A hereto (collectively, the "U.S. Underwriters," which term
shall also include any underwriter substituted as hereinafter provided in
Section 10 hereof), for whom Xxxxxxx Lynch, Goldman, Sachs & Co., Deutsche Bank
Securities Inc., Xxxxxx Brothers Inc. and BancBoston Xxxxxxxxx Xxxxxxxx Inc. are
acting as representatives (in such capacity, the "U.S. Representatives"), with
respect to the issue and sale by the Company and the purchase by the U.S.
Underwriters, acting severally and not jointly, of the respective numbers of
shares of Common Stock, par value $.001 per share, of the Company ("Common
Stock") set forth in said Schedule A, and with respect to the grant by the
Company to the U.S. Underwriters, acting severally and not jointly, of the
option described in Section 2(b) hereof to purchase all or any part of 720,000
additional shares of Common Stock to cover over-allotments, if any. The
4,800,000 shares
of Common Stock (the "Initial U.S. Securities") to be purchased by the U.S.
Underwriters and all or any part of the 720,000 shares of Common Stock subject
to the option described in Section 2(b) hereof (the "U.S. Option Securities")
are hereinafter collectively called the "U.S. Securities."
It is understood that the Company is concurrently entering into an
agreement dated the date hereof (the "International Purchase Agreement")
providing for the offering by the Company of an aggregate of 1,200,000 shares of
Common Stock (the "Initial International Securities") through arrangements with
certain underwriters outside the United States and Canada (the "International
Managers") for which Xxxxxxx Xxxxx International, Xxxxxxx Sachs International,
Deutsche Bank Securities AG London, Xxxxxx Brothers International (Europe) and
BancBoston Xxxxxxxxx Xxxxxxxx International Limited are acting as lead managers
(the "Lead Managers") and the grant by the Company to the International
Managers, acting severally and not jointly, of an option to purchase all or any
part of the International Managers' pro rata portion of up to 180,000 additional
shares of Common Stock solely to cover overallotments, if any (the
"International Option Securities" and, together with the U.S. Option Securities,
the "Option Securities"). The Initial International Securities and the
International Option Securities are hereinafter collectively called the
"International Securities." It is understood and agreed that the Company is not
obligated to sell and the U.S. Underwriters are not obligated to purchase, any
Initial U.S. Securities unless all of the Initial International Securities are
contemporaneously purchased by the International Managers. The U.S. Underwriters
and the International Managers are hereinafter collectively called the
"Underwriters"; the Initial U.S. Securities and the Initial International
Securities are hereinafter collectively called the "Initial Securities"; and the
U.S. Securities and the International Securities are hereinafter collectively
called the "Securities."
The Underwriters will concurrently enter into an Intersyndicate
Agreement of even date herewith (the "Intersyndicate Agreement") providing for
the coordination of certain transactions among the Underwriters under the
direction of Xxxxxxx Xxxxx & Co., Xxxxxxx Lynch, Pierce, Xxxxxx & Xxxxx
Incorporated (in such capacity, the "Global Coordinator").
The Company understands that the U.S. Underwriters propose to make a
public offering of the U.S. Securities as soon as the U.S. Representatives deem
advisable after this Agreement has been executed and delivered.
It is understood that concurrently with the offering and sale of the
Securities the Company intends to offer and sell in a registered public offering
$250 million aggregate principal amount of convertible subordinated notes due
2004 (the "Convertible Notes"). The Company is concurrently entering into a
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purchase agreement dated the date hereof (the "Convertible Note Purchase
Agreement") relating to the offering of Convertible Notes through arrangements
with certain underwriters. Neither the offer and sale of the Securities
contemplated hereby nor the offer and sale of Convertible Notes is conditioned
upon consummation of the other.
The Company has filed with the Securities and Exchange Commission (the
"Commission") a registration statement on Form S-1 (No. 333- ) covering, among
other things, the registration of the Securities under the Securities Act of
1933, as amended (the "1933 Act"), including the related preliminary prospectus
or prospectuses. Promptly after execution and delivery of this Agreement, the
Company will either (i) prepare and file a prospectus in accordance with the
provisions of Rule 430A ("Rule 430A") of the rules and regulations of the
Commission under the 1933 Act (the "1933 Act Regulations") and paragraph (b) of
Rule 424 ("Rule 424(b)") of the 1933 Act Regulations or (ii) if the Company has
elected to rely upon Rule 434 ("Rule 434") of the 1933 Act Regulations, prepare
and file a term sheet (a "Term Sheet") in accordance with the provisions of Rule
434 and Rule 424(b). Two forms of prospectus are to be used in connection with
the offering and sale of the Securities: (i) a form relating to the U.S.
Securities (the "Form of U.S. Prospectus") and (ii) a form relating to the
International Securities (the "Form of International Prospectus"). The Form of
International Prospectus is identical to the Form of U.S. Prospectus, except for
the front cover and back cover pages and the information under the caption
"Underwriting." The information included in any such prospectus or in any such
Term Sheet, as the case may be, that was omitted from such registration
statement at the time it became effective but that is deemed to be part of such
registration statement at the time it became effective (i) pursuant to paragraph
(b) of Rule 430A is referred to as "Rule 430A Information" or (ii) pursuant to
paragraph (d) of Rule 434 is referred to as "Rule 434 Information." Each Form of
U.S. Prospectus and Form of International Prospectus used before such
registration statement became effective, and any prospectus that omitted, as
applicable, the Rule 430A Information or the Rule 434 Information, that was used
after such effectiveness and prior to the execution and delivery of this
Agreement, is herein called a "preliminary prospectus." Such registration
statement, including the exhibits thereto and schedules thereto at the time it
became effective and including the Rule 430A Information and the Rule 434
Information, as applicable, is herein called the "Registration Statement." Any
registration statement filed pursuant to Rule 462(b) of the 1933 Act Regulations
is herein referred to as the "Rule 462(b) Registration Statement," and after
such filing the term "Registration Statement" shall include the Rule 462(b)
Registration Statement. The final Form of U.S. Prospectus and Form of
International Prospectus in the forms first furnished to the Underwriters for
use in connection with the offering of the Securities are herein called the
"U.S. Prospectus" and the "International
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Prospectus," respectively, and collectively, the "Prospectuses." If Rule 434 is
relied on, the terms "U.S. Prospectus" and "International Prospectus" shall
refer to the preliminary U.S. Prospectus dated , 1999 and the preliminary
International Prospectus dated , 1999, respectively, each together with the
applicable Term Sheet, and all references in this Agreement to the date of such
Prospectuses shall mean the date of the applicable Term Sheet.
For purposes of this Agreement, all references to the Registration
Statement, any preliminary prospectus, the U.S. Prospectus, the International
Prospectus or any Term Sheet or any amendment or supplement to any of the
foregoing shall be deemed to include the copy filed with the Commission pursuant
to its Electronic Data Gathering, Analysis and Retrieval system ("XXXXX").
SECTION 1. Representations and Warranties.
(a) Representations and Warranties by the Company. The Company
represents and warrants to each U.S. Underwriter as of the date hereof, as of
the Closing Time referred to in Section 2(c) hereof, and as of each Date of
Delivery (if any) referred to in Section 2(b), hereof and agrees with each U.S.
Underwriter, as follows:
(i) Compliance with Registration Requirements. Each of the
Registration Statement and any Rule 462(b) Registration Statement has
become effective under the 1933 Act and no stop order suspending the
effectiveness of the Registration Statement or any Rule 462(b)
Registration Statement has been issued under the 1933 Act and no
proceedings for that purpose have been instituted or are pending or, to
the knowledge of the Company, are contemplated by the Commission, and
any request on the part of the Commission for additional information has
been complied with.
At the respective times the Registration Statement, any Rule
462(b) Registration Statement and any post-effective amendments thereto
became effective and at the Closing Time (and, if any U.S. Option
Securities are purchased, at the Date of Delivery), the Registration
Statement, the Rule 462(b) Registration Statement and any amendments and
supplements thereto complied and will comply in all material respects
with the applicable requirements of the 1933 Act and the 1933 Act
Regulations and did not and will not contain an 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. None
of the Prospectuses nor any amendments or supplements thereto (including
any prospectus wrapper), at the time the Prospectuses or any amendments
or
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supplements thereto were issued and at the Closing Time (and, if any
U.S. Option Securities are purchased, at the Date of Delivery), included
or will include an untrue statement of a material fact or omitted or
will omit to state a material fact necessary in order to make the
statements therein, in the light of the circumstances under which they
were made, not misleading. If Rule 434 is used, the Company will comply
with the requirements of Rule 434 and the Prospectuses shall not be
"materially different," as such term is used in Rule 434, from the
prospectuses included in the Registration Statement at the time it
became effective. The representations and warranties in this subsection
shall not apply to statements in or omissions from the Registration
Statement or the U.S. Prospectus made in reliance upon and in conformity
with information furnished to the Company in writing by any U.S.
Underwriter through the U.S. Representatives expressly for use in the
Registration Statement or the U.S. Prospectus.
The prospectuses filed as part of the Registration Statement as
originally filed or as part of any amendment thereto, or filed pursuant
to Rule 424 under the 1933 Act, complied when so filed in all material
respects with the 1933 Act Regulations and each of the preliminary
prospectuses and the Prospectuses delivered to the Underwriters for use
in connection with this offering was identical to the electronically
transmitted copies thereof filed with the Commission pursuant to XXXXX,
except to the extent permitted by Regulation S-T.
(ii) Independent Accountants. The accountants who certified the
financial statements and supporting schedules included in the
Registration Statement and the financial statements and supporting
schedules thereto are independent public accountants as required by the
1933 Act and the 1933 Act Regulations.
(iii) Financial Statements. The financial statements included in the
Registration Statement and the Prospectuses, together with the related
schedules and notes, present fairly the financial position of the
Company and its consolidated subsidiaries at the dates indicated and the
statement of operations, stockholders' equity and cash flows of the
Company and its consolidated subsidiaries for the periods specified;
said financial statements have been prepared in conformity with
generally accepted accounting principles ("GAAP") applied on a
consistent basis throughout the periods involved. The selected financial
data and the summary financial information included in the Prospectuses
present fairly the information shown therein and have been compiled on a
basis consistent with that of the audited financial statements included
in the Registration
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Statement. The pro forma financial statements and the related notes
thereto included in the Registration Statement and the Prospectuses
present fairly the information shown therein, have been prepared in
accordance with the Commission's rules and guidelines with respect to
pro forma financial statements and have been properly compiled on the
bases described therein, and the assumptions used in the preparation
thereof are reasonable and the adjustments used therein are appropriate
to give effect to the transactions and circumstances referred to
therein.
(iv) No Material Adverse Change in Business. Since the respective
dates as of which information is given in the Registration Statement and
the Prospectuses, except as otherwise stated therein, (A) there has been
no material adverse change in the condition, financial or otherwise, or
in the earnings, business affairs or business prospects of the Company,
its subsidiaries, as of the date hereof, and each of VerticalNet, Inc.,
Benchmarking Partners, Inc., Breakaway Solutions, Inc., Xxxx.xxx, Inc.,
eMerge Interactive, Inc., XXXXX.xxx, Xxxxxxxxxxxxx.xxx, CommerX, Inc.,
CommerceQuest Inc., Purchasing Solutions, Inc., Xxxxxxx.xxx, Universal
Access, Inc. and Vitaltone (each, a "Material Holding" and,
collectively, the "Material Holdings"), considered as one enterprise
reflecting the Company's ownership interests in its subsidiaries and the
Material Holdings, whether or not arising in the ordinary course of
business, (a "Material Adverse Effect") (B) there have been no
transactions entered into by the Company, any of its subsidiaries or
Material Holdings, other than those in the ordinary course of business,
which are material with respect to the Company, its subsidiaries and the
Material Holdings, considered as one enterprise reflecting the Company's
ownership interests in its subsidiaries and the Material Holdings, and
(C) there has been no dividend or distribution of any kind declared,
paid or made by the Company on any class of its capital stock.
(v) Good Standing of the Company. The Company has been duly
organized and is validly existing as a corporation in good standing
under the laws of the State of Delaware and has corporate power and
authority to own, lease and operate its properties and to conduct its
business as described in the Prospectuses and to enter into and perform
its obligations under this Agreement and the International Purchase
Agreement; and the Company is duly qualified as a foreign corporation to
transact business and is in good standing in each other jurisdiction in
which such qualification is required, whether by reason of the ownership
or leasing of property or the conduct of business, except where the
failure so to qualify or to be in good standing would not result in a
Material Adverse Effect.
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(vi) Good Standing of Subsidiaries and Material Holdings. Each of
the majority-owned subsidiaries of the Company (the "Subsidiaries") and
each Material Holding has been duly organized and is validly existing as
a corporation in good standing under the laws of the jurisdiction of its
incorporation, has corporate power and authority to own, lease and
operate its properties and to conduct its business as described in the
Prospectuses and is duly qualified as a foreign corporation to transact
business and is in good standing in each jurisdiction in which such
qualification is required, whether by reason of the ownership or leasing
of property or the conduct of business, except where the failure so to
qualify or to be in good standing would not result in a Material Adverse
Effect; the issued and outstanding capital stock of each of the
Company's subsidiaries and each Material Holding has been duly
authorized and validly issued, is fully paid and non-assessable, and the
Company owns its interests in its Subsidiaries and the Material
Holdings, in each case in the amounts and percentages (subject to
rounding) disclosed in the Registration Statement, directly or through
subsidiaries, free and clear of any security interest, mortgage, pledge,
lien, encumbrance, claim or equity except for the security interest
granted by the Company to PNC Bank, N.A. under the revolving bank credit
facility and as otherwise disclosed in the Registration Statement; and
none of the outstanding shares of capital stock of any of its
Subsidiaries or Material Holdings owned by the Company was issued in
violation of the preemptive or similar rights of any securityholder of
such subsidiary or Material Holding.
(vii) Capitalization. The authorized, issued and outstanding
capital stock of the Company is as set forth in the Prospectuses in the
column entitled "Actual" under the caption "Capitalization" (except for
subsequent issuances, if any, pursuant to this Agreement, the
International Purchase Agreement and the Convertible Note Purchase
Agreement or pursuant to reservations, agreements or employee benefit
plans referred to in the Prospectuses or pursuant to the exercise of
convertible securities, warrants or options referred to in the
Prospectuses). The shares of issued and outstanding capital stock of the
Company have been duly authorized and validly issued and are fully paid
and non-assessable; none of the outstanding shares of capital stock of
the Company was issued in violation of the preemptive or other similar
rights of any securityholder of the Company.
(viii) Authorization of Agreements. Each of this Agreement, the
International Purchase Agreement and the Convertible Note Purchase
7
Agreement has been duly authorized, executed and delivered by the
Company.
(ix) Authorization and Description of Securities and Convertible
Notes. The Securities and the Convertible Notes have been duly
authorized for issuance and sale pursuant to this Agreement, the
International Purchase Agreement and the Convertible Note Purchase
Agreement, and, when issued and delivered by the Company hereunder and
thereunder, against payment of the consideration set forth herein and
therein, respectively, will be validly issued, fully paid and
non-assessable; the Common Stock and the Convertible Notes conform to
all statements relating thereto contained in the Prospectuses and such
description conforms to the rights set forth in the instruments defining
the same; no holder of the Securities or the Convertible Notes will be
subject to personal liability by reason of being such a holder; and the
issuance of the Securities and the Convertible Notes is not subject to
the preemptive or other similar rights of any securityholder of the
Company.
(x) Absence of Defaults and Conflicts. Neither the Company nor
any of its Subsidiaries nor any Material Holding is in violation of its
charter or by-laws or in default in the performance or observance of any
obligation, agreement, covenant or condition contained in any contract,
indenture, mortgage, deed of trust, loan or credit agreement, note,
lease or other agreement or instrument to which the Company, any of its
Subsidiaries or any Material Holding is a party or by which it or any of
them may be bound, or to which any of the property or assets of the
Company, any of its subsidiaries or any Material Holding is subject
(collectively, "Agreements and Instruments"), except for such violations
and defaults that would not result in a Material Adverse Effect; and the
execution, delivery and performance of this Agreement, the International
Purchase Agreement and the Convertible Note Purchase Agreement and the
consummation of the transactions contemplated herein and therein and in
the Registration Statement (including the issuance and sale of the
Securities and the use of the proceeds from the sale of the Securities
as described in the Prospectuses under the caption "Use of Proceeds")
and compliance by the Company with its obligations under this Agreement,
the International Purchase Agreement and the Convertible Note Purchase
Agreement have been duly authorized by all necessary corporate action
and do not and will not, whether with or without the giving of notice or
passage of time or both, conflict with or constitute a breach of, or
default or Repayment Event (as defined below) under, or result in the
creation or imposition of any lien, charge or encumbrance upon any
property or assets of the Company or any of its Subsidiaries or Material
Holdings pursuant
8
to, the Agreements and Instruments (except for such conflicts, breaches
or defaults or liens, charges or encumbrances that would not result in a
Material Adverse Effect), nor will such action result in any violation
of the provisions of the charter or by-laws of the Company or any of its
Subsidiaries or Material Holdings or any applicable law, statute, rule,
regulation, judgment, order, writ or decree of any government,
government instrumentality or court, domestic or foreign, having
jurisdiction over the Company or any of its Subsidiaries or Material
Holdings or any of their assets, properties or operations except such as
may be required by the securities or Blue Sky laws of the various states
and jurisdictions in connection with the offer and sale of the Common
Stock or except for such violations that would not result in a Material
Adverse Effect. As used herein, a "Repayment Event" means any event or
condition which gives the holder of any note, debenture or other
evidence of indebtedness (or any person acting on such holder's behalf)
the right to require the repurchase, redemption or repayment of all or a
portion of such indebtedness by the Company or any of its Subsidiaries
or Material Holdings.
(xi) Absence of Labor Dispute. No labor dispute with the employees
of the Company or any of its Subsidiaries or Material Holdings exists
or, to the knowledge of the Company, is imminent, and the Company is not
aware of any existing or imminent labor disturbance by the employees of
any of its or any Subsidiary's or Material Holding's principal
suppliers, manufacturers, customers or contractors, which, in either
case, may reasonably be expected to result in a Material Adverse Effect.
(xii) Absence of Proceedings. There is no action, suit, proceeding,
inquiry or investigation before or brought by any court or governmental
agency or body, domestic or foreign, now pending, or, to the knowledge
of the Company, threatened, against or affecting the Company or any of
its Subsidiaries or Material Holdings, which is required to be disclosed
in the Registration Statement (other than as disclosed therein), or
which might reasonably be expected to result in a Material Adverse
Effect, or which might reasonably be expected to materially and
adversely affect the properties or assets of the Company, its
Subsidiaries and the Material Holdings, considered as one enterprise
reflecting the Company's ownership interests in its Subsidiaries and the
Material Holdings or the consummation of the transactions contemplated
in this Agreement, the International Purchase Agreement and the
Convertible Note Purchase Agreement or the performance by the Company of
its obligations hereunder or thereunder; the aggregate of all pending
legal or governmental proceedings to which the
9
Company or any of its Subsidiaries or Material Holdings is a party or of
which any of their respective property or assets is the subject which
are not described in the Registration Statement, including ordinary
routine litigation incidental to the business, could not reasonably be
expected to result in a Material Adverse Effect.
(xiii) Accuracy of Exhibits. There are no contracts or documents
which are required to be described in the Registration Statement or the
Prospectuses or to be filed as exhibits thereto which have not been so
described and filed as required.
(xiv) Possession of Intellectual Property. The Company, its
Subsidiaries and its Material Holdings own or possess, or can acquire on
reasonable terms, adequate patents, patent rights, licenses, inventions,
copyrights, know-how (including trade secrets and other unpatented
and/or unpatentable proprietary or confidential information, systems or
procedures), trademarks, service marks, trade names or other
intellectual property (collectively, "Intellectual Property") necessary
to carry on the business now operated by them, and neither the Company
nor any of its Subsidiaries or Material Holdings has received any notice
or is otherwise aware of any infringement of or conflict with asserted
rights of others with respect to any Intellectual Property or of any
facts or circumstances which would render any Intellectual Property
invalid or inadequate to protect the interest of the Company or any of
its Subsidiaries or Material Holdings therein, and which infringement or
conflict (if the subject of any unfavorable decision, ruling or finding)
or invalidity or inadequacy, singly or in the aggregate, would result in
a Material Adverse Effect.
(xv) Absence of Further Requirements. No filing with, or
authorization, approval, consent, license, order, registration,
qualification or decree of, any court or governmental authority or
agency is necessary or required for the performance by the Company of
its obligations hereunder, in connection with the offering, issuance or
sale of the Securities under this Agreement and the International
Purchase Agreement and of the Convertible Notes under the Convertible
Note Purchase Agreement or the consummation of the transactions
contemplated herein and therein, except such as have been already
obtained or as may be required under the 1933 Act or the 1933 Act
Regulations and foreign or state securities or blue sky law.
(xvi) Possession of Licenses and Permits. The Company, its
Subsidiaries and its Material Holdings possess such permits, licenses,
approvals, consents and other authorizations (collectively,
"Governmental
10
Licenses") issued by the appropriate federal, state, local or foreign
regulatory agencies or bodies necessary to conduct the business now
operated by them; the Company, its Subsidiaries and its Material
Holdings are in compliance with the terms and conditions of all such
Governmental Licenses, except where the failure so to comply would not,
singly or in the aggregate, have a Material Adverse Effect; all of the
Governmental Licenses are valid and in full force and effect, except
when the invalidity of such Governmental Licenses or the failure of such
Governmental Licenses to be in full force and effect would not have a
Material Adverse Effect; and neither the Company nor any of its
Subsidiaries or Material Holdings has received any notice of proceedings
relating to the revocation or modification of any such Governmental
Licenses which, singly or in the aggregate, if the subject of an
unfavorable decision, ruling or finding, would result in a Material
Adverse Effect.
(xvii) Title to Property. The Company, its Subsidiaries and its
Material Holdings have good and marketable title to all real property
owned by the Company, its Subsidiaries and its Material Holdings and
good title to all other properties owned by them, in each case, free and
clear of all mortgages, pledges, liens, security interests, claims,
restrictions or encumbrances of any kind except such as (a) are
described in the Prospectuses or (b) do not, singly or in the aggregate,
materially affect the value of such property and do not interfere with
the use made and proposed to be made of such property by the Company or
any of its Subsidiaries or Material Holdings; and all of the leases and
subleases material to the business of the Company, its Subsidiaries and
its Material Holdings, considered as one enterprise, and under which the
Company or any of its Subsidiaries or Material Holdings holds properties
described in the Prospectuses, are in full force and effect, and neither
the Company nor any subsidiary nor any Material Holding has any notice
of any material claim of any sort that has been asserted by anyone
adverse to the rights of the Company or any of its Subsidiaries or
Material Holdings under any of the leases or subleases mentioned above,
or affecting or questioning the rights of the Company or any such
subsidiary or Material Holding to the continued possession of the leased
or subleased premises under any such lease or sublease.
(xviii) Investment Company Act. The Company is not, and upon the
issuance and sale of the Securities and the Convertible Notes as
contemplated herein and in the Convertible Note Purchase Agreement, will
not be, required to register as an "investment company" under the
Investment Company Act of 1940, as amended (the "1940 Act").
11
(xix) Environmental Laws. Except as described in the Registration
Statement and except as would not, singly or in the aggregate, have a
Material Adverse Effect, (A) neither the Company nor any of its
Subsidiaries or Material Holdings is in violation of any federal, state,
local or foreign statute, law, rule, regulation, ordinance, code, policy
or rule of common law or any judicial or administrative interpretation
thereof, including any judicial or administrative order, consent, decree
or judgment, relating to pollution or protection of human health, the
environment (including, without limitation, ambient air, surface water,
groundwater, land surface or subsurface strata) or wildlife, including,
without limitation, laws and regulations relating to the release or
threatened release of chemicals, pollutants, contaminants, wastes, toxic
substances, hazardous substances, petroleum or petroleum products
(collectively, "Hazardous Materials") or to the manufacture, processing,
distribution, use, treatment, storage, disposal, transport or handling
of Hazardous Materials (collectively, "Environmental Laws"), (B) the
Company, its Subsidiaries and its Material Holdings have all permits,
authorizations and approvals required under any applicable Environmental
Laws and are each in compliance with their requirements, (C) there are
no pending or threatened administrative, regulatory or judicial actions,
suits, demands, demand letters, claims, liens, notices of noncompliance
or violation, investigation or proceedings relating to any Environmental
Law against the Company, any of its Subsidiaries or any of its Material
Holdings and (D) there are no events or circumstances that might
reasonably be expected to form the basis of an order for clean-up or
remediation, or an action, suit or proceeding by any private party or
governmental body or agency, against or affecting the Company, any of
its Subsidiaries or any of its Material Holdings relating to Hazardous
Materials or any Environmental Laws.
(xx) Registration Rights. Other than rights that have been waived
for 180 days from August 4, 1999, the date of the initial public
offering of shares of common stock of the Company, there are no persons
with registration rights or other similar rights to have any securities
registered pursuant to the Registration Statement or otherwise
registered by the Company under the 1933 Act.
(xxi) Year 2000. The Company is reviewing its operations and those
of its Subsidiaries and any Material Holdings to evaluate the extent to
which the businesses or operations of the Company or any of its
Subsidiaries or Material Holdings will be affected by the Year 2000
Problem; as a result of such review, the Company believes that the
disclosure in the Prospectuses relating to the Year 2000 Problem is
accurate in all material respects. As used in clause (xxi), the "Year
2000 Problem"
12
means any significant risk that computer hardware or
software used in the receipt, transmission, processing, manipulation,
storage, retrieval, transmission or other utilization of data or in the
operation of mechanical or electrical systems of any kind will not
materially affect the business operations of the Company, its
Subsidiaries and any Material Holdings after December 31, 1999.
(b) Officer's Certificates. Any certificate signed by any officer of the
Company or any of its Subsidiaries or Material Holdings delivered to the Global
Coordinator, the U.S. Representatives or to counsel for the U.S. Underwriters
shall be deemed a representation and warranty by the Company to each U.S.
Underwriter as to the matters covered thereby.
SECTION 2. Sale and Delivery to U.S. Underwriters; Closing.
(a) Initial Securities. On the basis of the representations and
warranties herein contained and subject to the terms and conditions herein set
forth, the Company agrees to sell to each U.S. Underwriter, severally and not
jointly, and each U.S. Underwriter, severally and not jointly, agrees to
purchase from the Company, at the price per share set forth in Schedule B, the
number of Initial U.S. Securities set forth in Schedule A opposite the name of
such U.S. Underwriter, plus any additional number of Initial U.S. Securities
which such Underwriter may become obligated to purchase pursuant to the
provisions of Section 10 hereof.
(b) Option Securities. In addition, on the basis of the representations
and warranties herein contained and subject to the terms and conditions herein
set forth, the Company hereby grants an option to the U.S. Underwriters,
severally and not jointly, to purchase up to an additional 720,000 shares of
Common Stock at the price per share set forth in Schedule B, less an amount per
share equal to any dividends or distributions declared by the Company and
payable on the Initial U.S. Securities but not payable on the U.S. Option
Securities. The option hereby granted will expire 30 days after the date hereof
and may be exercised in whole or in part from time to time only for the purpose
of covering over-allotments which may be made in connection with the offering
and distribution of the Initial U.S. Securities upon notice by the Global
Coordinator to the Company setting forth the number of U.S. Option Securities as
to which the several U.S. Underwriters are then exercising the option and the
time and date of payment and delivery for such U.S. Option Securities. Any such
time and date of delivery for the U.S. Option Securities (a "Date of Delivery")
shall be determined by the Global Coordinator, but shall not be earlier than two
nor later than seven full business days after the exercise of said option, nor
in any event prior to the Closing Time, as hereinafter defined. If the option is
exercised as to all or any portion of the U.S. Option Securities, each of the
U.S. Underwriters, acting severally and not jointly, will
13
purchase that proportion of the total number of U.S. Option Securities then
being purchased which the number of Initial U.S. Securities set forth in
Schedule A opposite the name of such U.S. Underwriter bears to the total number
of Initial U.S. Securities, subject in each case to such adjustments as the
Global Coordinator in its discretion shall make to eliminate any sales or
purchases of fractional shares.
(c) Payment. Payment of the purchase price for, and delivery of
certificates for, the Initial Securities shall be made at the offices of Dechert
Price & Xxxxxx, 4000 Xxxx Atlantic Tower 0000 Xxxx Xxxxxx, Xxxxxxxxxxxx,
Xxxxxxxxxxxx 00000, or at such other place as shall be agreed upon by the Global
Coordinator and the Company, at 9:00 A.M. (Eastern time) on the third (fourth,
if the pricing occurs after 4:30 P.M. (Eastern time) on any given day) business
day after the date hereof (unless postponed in accordance with the provisions of
Section 10), or such other time not later than ten business days after such date
as shall be agreed upon by the Global Coordinator and the Company (such time and
date of payment and delivery being herein called "Closing Time").
In addition, in the event that any or all of the U.S. Option Securities
are purchased by the U.S. Underwriters, payment of the purchase price for, and
delivery of certificates for, such U.S. Option Securities shall be made at the
above-mentioned offices, or at such other place as shall be agreed upon by the
Global Coordinator and the Company, on each Date of Delivery as specified in the
notice from the Global Coordinator to the Company.
Payment shall be made to the Company by wire transfer of immediately
available funds to a bank account designated by the Company, against delivery to
the U.S. Representatives for the respective accounts of the U.S. Underwriters of
certificates for the U.S. Securities to be purchased by them. It is understood
that each U.S. Underwriter has authorized the U.S. Representatives, for its
account, to accept delivery of, receipt for, and make payment of the purchase
price for, the Initial U.S. Securities and the U.S. Option Securities, if any,
which it has agreed to purchase. Xxxxxxx Xxxxx, individually and not as
representative of the U.S. Underwriters, may (but shall not be obligated to)
make payment of the purchase price for the Initial U.S. Securities or the U.S.
Option Securities, if any, to be purchased by any U.S. Underwriter whose funds
have not been received by the Closing Time or the relevant Date of Delivery, as
the case may be, but such payment shall not relieve such U.S. Underwriter from
its obligations hereunder.
(d) Denominations; Registration. Certificates for the Initial U.S.
Securities and the U.S. Option Securities, if any, shall be in such
denominations and registered in such names as the U.S. Representatives may
request in writing not later than 10:00 A.M. on the second business day before
the Closing Time or the relevant Date of Delivery, as the case may be. The
certificates for the Initial
14
U.S. Securities and the U.S. Option Securities, if any, will be made available
for examination and packaging by the U.S. Representatives in The City of New
York not later than 10:00 A.M. (Eastern time) on the business day prior to the
Closing Time or the relevant Date of Delivery, as the case may be.
SECTION 3. Covenants of the Company. The Company covenants with each
U.S. Underwriter as follows:
(a) Compliance with Securities Regulations and Commission Requests. The
Company, subject to Section 3(b), will comply with the requirements of Rule 430A
or Rule 434, as applicable, and will notify the Global Coordinator immediately,
and confirm the notice in writing, (i) when any post-effective amendment to the
Registration Statement shall become effective, or any supplement to the
Prospectuses or any amended Prospectuses shall have been filed, (ii) of the
receipt of any comments from the Commission, (iii) of any request by the
Commission for any amendment to the Registration Statement or any amendment or
supplement to the Prospectuses or for additional information, and (iv) of the
issuance by the Commission of any stop order suspending the effectiveness of the
Registration Statement or of any order preventing or suspending the use of any
preliminary prospectus, or of the suspension of the qualification of the
Securities for offering or sale in any jurisdiction, or of the initiation or
threatening of any proceedings for any of such purposes. The Company will
promptly effect the filings necessary pursuant to Rule 424(b) and will take such
steps as it deems necessary to ascertain promptly whether the form of prospectus
transmitted for filing under Rule 424(b) was received for filing by the
Commission and, in the event that it was not, it will promptly file such
prospectus. The Company will make every reasonable effort to prevent the
issuance of any stop order and, if any stop order is issued, to obtain the
lifting thereof at the earliest possible moment.
(b) Filing of Amendments. The Company will give the Global Coordinator
notice of its intention to file or prepare any amendment to the Registration
Statement (including any filing under Rule 462(b)), any Term Sheet or any
amendment, supplement or revision to either the prospectus included in the
Registration Statement at the time it became effective or to the Prospectuses,
will furnish the Global Coordinator with copies of any such documents a
reasonable amount of time prior to such proposed filing or use, as the case may
be, and will not file or use any such document to which the Global Coordinator
or counsel for the U.S. Underwriters shall object.
(c) Delivery of Registration Statements. The Company has furnished or
will deliver to the U.S. Representatives and counsel for the U.S. Underwriters,
without charge, signed copies of the Registration Statement as originally filed
and of each amendment thereto (including exhibits filed therewith or
incorporated by
15
reference therein) and signed copies of all consents and certificates of
experts, and will also deliver to the U.S. Representatives, without charge, a
conformed copy of the Registration Statement as originally filed and of each
amendment thereto (without exhibits) for each of the U.S. Underwriters. The
copies of the Registration Statement and each amendment thereto furnished to the
U.S. Underwriters will be identical to the electronically transmitted copies
thereof filed with the Commission pursuant to XXXXX, except to the extent
permitted by Regulation S-T.
(d) Delivery of Prospectuses. The Company has delivered to each U.S.
Underwriter, without charge, as many copies of each preliminary prospectus as
such U.S. Underwriter reasonably requested, and the Company hereby consents to
the use of such copies for purposes permitted by the 1933 Act. The Company will
furnish to each U.S. Underwriter, without charge, during the period when the
U.S. Prospectus is required to be delivered under the 1933 Act or the Securities
Exchange Act of 1934 (the "1934 Act"), such number of copies of the U.S.
Prospectus (as amended or supplemented) as such U.S. Underwriter may reasonably
request but in no event later than 4 days following the date of this Agreement.
The U.S. Prospectus and any amendments or supplements thereto furnished to the
U.S. Underwriters will be identical to the electronically transmitted copies
thereof filed with the Commission pursuant to XXXXX, except to the extent
permitted by Regulation S-T.
(e) Continued Compliance with Securities Laws. The Company will comply
with the applicable requirements of the 1933 Act and the 1933 Act Regulations so
as to permit the completion of the distribution of the Securities and the
Convertible Notes as contemplated in this Agreement, the International Purchase
Agreement and the Convertible Note Purchase Agreement and in the Prospectuses.
If at any time when a prospectus is required by the 1933 Act to be delivered in
connection with sales of the Securities and the Convertible Notes, any event
shall occur or condition shall exist as a result of which it is necessary, in
the opinion of counsel for the U.S. Underwriters or for the Company, to amend
the Registration Statement or amend or supplement any Prospectus in order that
the Prospectuses will not include any untrue statements of a material fact or
omit to state a material fact necessary in order to make the statements therein
not misleading in the light of the circumstances existing at the time it is
delivered to a purchaser, or if it shall be necessary, in the opinion of such
counsel, at any such time to amend the Registration Statement or amend or
supplement any Prospectus in order to comply with the applicable requirements of
the 1933 Act or the 1933 Act Regulations, the Company will promptly prepare and
file with the Commission, subject to Section 3(b), such amendment or supplement
as may be necessary to correct such statement or omission or to make the
Registration Statement or the Prospectuses comply with such requirements, and
the Company
16
will furnish to the U.S. Underwriters such number of copies of such amendment or
supplement as the U.S. Underwriters may reasonably request.
(f) Blue Sky Qualifications. The Company will endeavor, in cooperation
with the U.S. Underwriters, to qualify the Securities for offering and sale
under the applicable securities laws of such states and other jurisdictions
(domestic or foreign) as the Global Coordinator may designate and to maintain
such qualifications in effect for a period of not less than one year from the
later of the effective date of the Registration Statement and any Rule 462(b)
Registration Statement; provided, however, that the Company shall not be
obligated to file any general consent to service of process or to qualify as a
foreign corporation or as a dealer in securities in any jurisdiction in which it
is not so qualified or to subject itself to taxation in respect of doing
business in any jurisdiction in which it is not otherwise so subject. In each
jurisdiction in which the Securities have been so qualified, the Company will
file such statements and reports as may be required by the laws of such
jurisdiction to continue such qualification in effect for a period of not less
than one year from the effective date of the Registration Statement and any Rule
462(b) Registration Statement.
(g) Rule 158. The Company will file such reports pursuant to the 1934 Act
as are necessary in order to make generally available to its securityholders no
later than 45 days after an earnings statement for the purposes of, and to
provide the benefits contemplated by, the last paragraph of Section 11(a) of the
1933 Act.
(h) Use of Proceeds. The Company will use the net proceeds received
by it from the sale of the Securities in the manner specified in the
Prospectuses under "Use of Proceeds."
(i) Listing. The Company will use its best efforts to maintain the
quotation of the Securities on the Nasdaq National Market and will file with the
Nasdaq National Market all documents and notices required by the Nasdaq National
Market of companies that have securities that are traded in the over-the-counter
market and quotations for which are reported by the Nasdaq National Market.
(j) Restriction on Sale of Securities. During a period of [180] days from
the date of the Prospectuses, the Company will not, without the prior written
consent of Xxxxxxx Xxxxx, directly or indirectly, (i) offer, pledge, sell,
contract to sell, sell any option or contract to purchase, purchase any option
or contract to sell, grant any option, right or warrant for the sale of, or
otherwise transfer or dispose of or transfer any shares of Common Stock or any
securities convertible into or exchangeable or exercisable for Common Stock or
file any registration statement under the 1933 Act with respect to any of the
foregoing or (ii) enter into any swap
17
or any other agreement or any transaction that transfers, in whole or in part,
the economic consequence of ownership of the Common Stock, whether any such swap
or transaction described in clause (i) or (ii) above is to be settled by
delivery of Common Stock or other securities, in cash or otherwise. The
foregoing sentence shall not apply to (A) the Securities to be sold hereunder
and under the International Purchase Agreement, (B) any shares of Common Stock
issued by the Company upon the exercise of an option or warrant or the
conversion of a security outstanding on the date hereof and referred to in the
Prospectuses, (C) any shares of Common Stock issued or options to purchase
Common Stock granted pursuant to existing employee benefit plans of the Company
referred to in the Prospectuses or (D) any shares of Common Stock issued
pursuant to any non-employee director stock plan or dividend reinvestment plan.
(k) Reporting Requirements. The Company, during the period when the
Prospectuses are required to be delivered under the 1933 Act or the 1934 Act,
will file all documents required to be filed with the Commission pursuant to the
1934 Act within the time periods required by the 1934 Act and the rules and
regulations of the Commission thereunder.
(l) Compliance with Rule 463. The Company will file with the Commission
such reports as may be required pursuant to Rule 463 of the 1933 Act
Regulations.
SECTION 4. Payment of Expenses.
(a) Expenses. The Company will pay all expenses incident to the
performance of its obligations under this Agreement, the International Purchase
Agreement and the Convertible Note Purchase Agreement including (i) the
preparation, printing and filing of the Registration Statement (including
financial statements and exhibits) as originally filed and of each amendment
thereto, (ii) the preparation, issuance and delivery of the certificates for the
Securities and the Convertible Notes, issuance or delivery of the Securities and
the Convertible Notes and the transfer of the Securities and the Convertible
Notes, (iii) the fees and disbursements of the Companys' counsel, accountants
and other advisors, (iv) the qualification of the Securities and the Convertible
Notes under securities laws in accordance with the provisions of Section 3(f)
hereof, including filing fees and the reasonable fees and disbursements of
counsel for the Underwriters in connection therewith and in connection with the
preparation of the Blue Sky Survey and any supplement thereto, (v) the printing
and delivery to the Underwriters of copies of each preliminary prospectus, any
of the Prospectuses and any amendments or supplements thereto, (vi) the
preparation, printing and delivery to the Underwriters of copies of the Blue Sky
Survey and any supplement thereto, (vii) the fees and expenses of any transfer
agent or registrar for the Securities and the Convertible
18
Notes and (viii) the filing fees incident to, and the reasonable fees and
disbursements of counsel to the Underwriters in connection with, the review by
the National Association of Securities Dealers, Inc. (the "NASD") of the terms
of the sale of the Securities and the Convertible Notes and (ix) the fees and
expenses incurred in connection with the inclusion of the Securities in the
Nasdaq National Market.
(b) Termination of Agreement. If this Agreement is terminated by
the U.S. Representatives in accordance with the provisions of Section 5 or
Section 9(a)(i) hereof, the Company shall reimburse the U.S. Underwriters for
all of their out-of-pocket expenses, including the reasonable fees and
disbursements of counsel for the U.S. Underwriters.
SECTION 5. Conditions of U.S. Underwriters' Obligations. The obligations
of the several U.S. Underwriters hereunder are subject to the accuracy of the
representations and warranties of the Company contained in Section 1 hereof or
in certificates of any officer of the Company or any of its Subsidiaries or
Material Holdings of the Company delivered pursuant to the provisions hereof, to
the performance by the Company of its covenants and other obligations hereunder,
and to the following further conditions:
(a) Effectiveness of Registration Statement. The Registration Statement,
including any Rule 462(b) Registration Statement, has become effective and at
Closing Time no stop order suspending the effectiveness of the Registration
Statement shall have been issued under the 1933 Act or proceedings therefor
initiated or threatened by the Commission, and any request on the part of the
Commission for additional information shall have been complied with to the
reasonable satisfaction of counsel to the U.S. Underwriters. A prospectus
containing the Rule 430A Information shall have been filed with the Commission
in accordance with Rule 424(b) (or a post-effective amendment providing such
information shall have been filed and declared effective in accordance with the
requirements of Rule 430A) or, if the Company has elected to rely upon Rule 434,
a Term Sheet shall have been filed with the Commission in accordance with Rule
424(b).
(b) Opinions of Counsel for Company. At Closing Time, the U.S.
Representatives shall have received the favorable opinion, dated as of Closing
Time, of (x) Dechert Price & Xxxxxx, counsel for the Company, and (y) Xxxxx Xxxx
& Xxxxxxxx, special 1940 Act counsel for the Company, in form and substance
satisfactory to counsel for the U.S. Underwriters, together with signed or
reproduced copies of such letter for each of the other U.S. Underwriters to the
effect set forth in Exhibit A and Exhibit B hereto, respectively . Such
counsel may also state that, insofar as such opinion involves factual matters,
they
19
have relied, to the extent they deem proper, upon certificates of officers of
the Company, its Subsidiaries and its Material Holdings and certificates of
public officials
(c) Opinion of Counsel for U.S. Underwriters. At Closing Time, the U.S.
Representatives shall have received the favorable opinion, dated as of Closing
Time, of Xxxxx Xxxx & Xxxxxxxx, counsel for the U.S. Underwriters, together with
signed or reproduced copies of such letter for each of the other U.S.
Underwriters in form and substance satisfactory to the U.S. Representatives, and
the penultimate paragraph of Exhibit A hereto. Such counsel may also state that,
insofar as such opinion involves factual matters, they have relied, to the
extent they deem proper, upon certificates of officers of the Company, its
Subsidiaries and its Material Holdings and certificates of public officials.
(d) Officers' Certificate. At Closing Time, there shall not have been,
since the date hereof or since the respective dates as of which information is
given in the Prospectuses, any Material Adverse Effect, whether or not arising
in the ordinary course of business, and the U.S. Representatives shall have
received a certificate of the President or a Vice President of the Company and
of the chief financial or chief accounting officer of the Company, dated as of
Closing Time, to the effect that (i) there has been no such Material Adverse
Effect, (ii) the representations and warranties in Section 1(a) hereof are true
and correct with the same force and effect as though expressly made at and as of
Closing Time, (iii) the Company has complied in all material respects with all
agreements and satisfied in all material respects all conditions on its part to
be performed or satisfied at or prior to Closing Time, and (iv) no stop order
suspending the effectiveness of the Registration Statement has been issued and
no proceeding for that purpose has been instituted or is pending or is
contemplated by the Commission.
(e) Accountant's Comfort Letters. At the time of the execution of this
Agreement, the U.S. Representatives shall have received one or more letters from
KPMG LLP dated such date, in form and substance satisfactory to the U.S.
Representatives, together with signed or reproduced copies of such letter(s) for
each of the other U.S. Underwriters containing statements and information of the
type ordinarily included in accountants' "comfort letters" to underwriters with
respect to the financial statements and certain financial information contained
in the Registration Statement and the Prospectuses.
(f) Bring-down Comfort Letter. At Closing Time, the Representatives shall
have received from KPMG LLP letter(s), dated as of Closing Time, to the effect
that they reaffirm the statements made in the letters furnished pursuant to
subsection (e) of this Section, except that the specified date referred to shall
be a date not more than three business days prior to Closing Time.
20
(g) No Objection. The NASD has confirmed that it has not raised any
objection with respect to the fairness and reasonableness of the underwriting
terms and arrangements.
(h) Lock-up Agreements. At the date of this Agreement, the U.S.
Representatives shall have received an agreement substantially in the form of
Exhibit C hereto signed by such securityholders as the U.S. Representatives
and the Company may mutually agree.
(i) Purchase of Initial International Securities. Contemporaneously
with the purchase by the U.S. Underwriters of the Initial U.S. Securities
under this Agreement, the International Managers shall have purchased the
Initial International Securities under the International Purchase Agreement.
(j) Conditions to Purchase of U.S. Option Securities. In the event that
the U.S. Underwriters exercise their option provided in Section 2(b) hereof to
purchase all or any portion of the U.S. Option Securities, the representations
and warranties of the Company contained herein and the statements in any
certificates furnished by the Company or any subsidiary of the Company hereunder
shall be true and correct as of each Date of Delivery and, at the relevant Date
of Delivery, the U.S. Representatives shall have received:
(i) Officers' Certificate. A certificate, dated such Date of
Delivery, of the President or a Vice President of the Company and of the
chief financial or chief accounting officer of the Company confirming
that the certificate delivered at the Closing Time pursuant to Section
5(d) hereof remains true and correct as of such Date of Delivery.
(ii) Opinion of Counsel for Company. The favorable opinion of
Dechert Price & Xxxxxx, counsel for the Company, in form and substance
satisfactory to counsel for the U.S. Underwriters, dated such Date of
Delivery, relating to the U.S. Option Securities to be purchased on such
Date of Delivery and otherwise to the same effect as the opinion
required by Section 5(b) hereof.
(iii) Opinion of Special 1940 Act Counsel. The favorable opinion
of Xxxxx Xxxx & Xxxxxxxx, special 1940 Act counsel for the Company,
dated such Date of Delivery, relating to the 1940 Act and otherwise to
the same effect as the opinion required by Section 5(b) hereof.
21
(iv) Opinion of Counsel for U.S. Underwriters. The favorable
opinion of Xxxxx Xxxx & Xxxxxxxx, counsel for the U.S. Underwriters,
dated such Date of Delivery, relating to the U.S. Option Securities to
be purchased on such Date of Delivery and otherwise to the same effect
as the opinion required by Section 5(c) hereof.
(v) Bring-down Comfort Letter. One or more letters from KPMG
LLP, in form and substance satisfactory to the U.S. Representatives and
dated such Date of Delivery, substantially in the same form and
substance as the letter furnished to the U.S. Representatives pursuant
to Section 5(f) hereof, except that the "specified date" in the letter
furnished pursuant to this paragraph shall be a date not more than five
days prior to such Date of Delivery.
(k) Additional Documents. At Closing Time and at each Date of Delivery,
counsel for the U.S. Underwriters shall have been furnished with such documents
and opinions as they may require for the purpose of enabling them to pass upon
the issuance and sale of the Securities and the Convertible Notes as
contemplated herein or in the Convertible Note Purchase Agreement, as the case
may be, or in order to evidence the accuracy of any of the representations or
warranties, or the fulfillment of any of the conditions, herein contained; and
all proceedings taken by the Company in connection with the issuance and sale of
the Securities and the Convertible Notes as contemplated herein or in the
Convertible Note Purchase Agreement, as the case may be, shall be satisfactory
in form and substance to the U.S. Representatives and counsel for the U.S.
Underwriters.
(l) Termination of Agreement. If any condition specified in this Section
shall not have been fulfilled in all material respects when and as required to
be fulfilled, this Agreement, or, in the case of any condition to the purchase
of U.S. Option Securities on a Date of Delivery which is after the Closing Time,
the obligations of the several U.S. Underwriters to purchase the relevant Option
Securities, may be terminated by the U.S. Representatives by notice to the
Company at any time at or prior to Closing Time or such Date of Delivery, as the
case may be, and such termination shall be without liability of any party to any
other party except as provided in Section 4 and except that Sections 1, 6, 7 and
8 shall survive any such termination and remain in full force and effect.
SECTION 6. Indemnification.
(a) Indemnification of U.S. Underwriters. The Company agrees to
indemnify and hold harmless each U.S. Underwriter and each person, if any, who
controls any U.S. Underwriter within the meaning of Section 15 of the 1933 Act
or Section 20 of the 1934 Act as follows:
22
(i) against any and all loss, liability, claim, damage and expense
whatsoever, as incurred, arising out of any untrue statement or alleged
untrue statement of a material fact contained in the Registration
Statement (or any amendment thereto), including the Rule 430A
Information and the Rule 434 Information, if applicable, or the omission
or alleged omission therefrom of a material fact required to be stated
therein or necessary to make the statements therein not misleading or
arising out of any untrue statement or alleged untrue statement of a
material fact included in any preliminary prospectus or the Prospectuses
(or any amendment or supplement thereto), or the omission or alleged
omission therefrom of a material fact necessary in order to make the
statements therein, in the light of the circumstances under which they
were made, not misleading;
(ii) against any and all loss, liability, claim, damage and
expense whatsoever, as incurred, to the extent of the aggregate amount
paid in settlement of any litigation, or any investigation or proceeding
by any governmental agency or body, commenced or threatened, or of any
claim whatsoever based upon any such untrue statement or omission, or
any such alleged untrue statement or omission; provided that (subject to
Section 6(d) below) any such settlement is effected with the written
consent of the Company; and
(iii) against any and all expense whatsoever, as incurred (including
the fees and disbursements of counsel chosen by Xxxxxxx Xxxxx),
reasonably incurred in investigating, preparing or defending against any
litigation, or any investigation or proceeding by any governmental
agency or body, commenced or threatened, or any claim whatsoever based
upon any such untrue statement or omission, to the extent that any such
expense is not paid under (i) or (ii) above;
provided, however, that this indemnity agreement shall not apply to any loss,
-------- -------
liability, claim, damage or expense to the extent arising out of any untrue
statement or omission or alleged untrue statement or omission made in reliance
upon and in conformity with written information furnished to the Company by any
U.S. Underwriter through the U.S. Representatives expressly for use in the
Registration Statement (or any amendment thereto), including the Rule 430A
Information and the Rule 434 Information, if applicable, or any preliminary
prospectus or the U.S. Prospectus (or any amendment or supplement thereto)
provided, further, that the foregoing indemnity agreement with respect to any
preliminary prospectus shall not inure to the benefit of any Underwriter who
failed to deliver a U.S. Prospectus to the person asserting any such losses,
liabilities, claims, damages and expenses.
23
(b) Indemnification of Company, Directors and Officers. Each U.S.
Underwriter severally agrees to indemnify and hold harmless the Company, its
directors, each of its officers who signed the Registration Statement, and each
person, if any, who controls the Company within the meaning of Section 15 of the
1933 Act or Section 20 of the 1934 Act against any and all loss, liability,
claim, damage and expense described in the indemnity contained in subsection (a)
of this Section, as incurred, but only with respect to untrue statements or
omissions, or alleged untrue statements or omissions, made in the Registration
Statement (or any amendment thereto), including the Rule 430A Information and
the Rule 434 Information, if applicable, or any preliminary U.S. prospectus or
the U.S. Prospectus (or any amendment or supplement thereto) in reliance upon
and in conformity with written information furnished to the Company by such U.S.
Underwriter through the U.S. Representatives expressly for use in the
Registration Statement (or any amendment thereto) or such preliminary prospectus
or the U.S. Prospectus (or any amendment or supplement thereto).
(c) Actions against Parties; Notification. Each indemnified party shall
give notice as promptly as reasonably practicable to each indemnifying party of
any action commenced against it in respect of which indemnity may be sought
hereunder, but failure to so notify an indemnifying party shall not relieve such
indemnifying party from any liability hereunder to the extent it is not
materially prejudiced as a result thereof and in any event shall not relieve it
from any liability which it may have otherwise than on account of this indemnity
agreement. In the case of parties indemnified pursuant to Section 6(a) above,
counsel to the indemnified parties shall be selected by Xxxxxxx Xxxxx, and, in
the case of parties indemnified pursuant to Section 6(b) above, counsel to the
indemnified parties shall be selected by the Company. An indemnifying party may
participate at its own expense in the defense of any such action; provided,
however, that counsel to the indemnifying party shall not (except with the
consent of the indemnified party) also be counsel to the indemnified party. In
no event shall the indemnifying parties be liable for fees and expenses of more
than one counsel (in addition to any local counsel) separate from their own
counsel for all indemnified parties in connection with any one action or
separate but similar or related actions in the same jurisdiction arising out of
the same general allegations or circumstances. No indemnifying party shall,
without the prior written consent of the indemnified parties, settle or
compromise or consent to the entry of any judgment with respect to any
litigation, or any investigation or proceeding by any governmental agency or
body, commenced or threatened, or any claim whatsoever in respect of which
indemnification or contribution could be sought under this Section 6 or Section
7 hereof (whether or not the indemnified parties are actual or potential parties
thereto), unless such settlement, compromise or consent (i) includes an
unconditional release of each indemnified party from all liability arising out
of such litigation, investigation, proceeding or claim and (ii) does not include
a
24
statement as to or an admission of fault, culpability or a failure to act by
or on behalf of any indemnified party.
(d) Settlement without Consent if Failure to Reimburse. If at any time
an indemnified party shall have requested an indemnifying party to reimburse the
indemnified party for fees and expenses of counsel, such indemnifying party
agrees that it shall be liable for any settlement of the nature contemplated by
Section 6(a)(iii) effected without its written consent if (i) such settlement is
entered into more than 45 days after receipt by such indemnifying party of the
aforesaid request, (ii) such indemnifying party shall have received notice of
the terms of such settlement at least 30 days prior to such settlement being
entered into and (iii) such indemnifying party shall not have reimbursed such
indemnified party in accordance with such request prior to the date of such
settlement.
SECTION 7. Contribution. If the indemnification provided for in Section
6 hereof is for any reason unavailable to or insufficient to hold harmless an
indemnified party in respect of any losses, liabilities, claims, damages or
expenses referred to therein, then each indemnifying party shall contribute to
the aggregate amount of such losses, liabilities, claims, damages and expenses
incurred by such indemnified party, as incurred, (i) in such proportion as is
appropriate to reflect the relative benefits received by the Company on the one
hand and the U.S. Underwriters on the other hand from the offering of the
Securities and the Convertible Notes pursuant to this Agreement and the
Convertible Note Purchase Agreement or (ii) if the allocation provided by clause
(i) is not permitted by applicable law, in such proportion as is appropriate to
reflect not only the relative benefits referred to in clause (i) above but also
the relative fault of the Company on the one hand and of the U.S. Underwriters
on the other hand in connection with the statements or omissions, which resulted
in such losses, liabilities, claims, damages or expenses, as well as any other
relevant equitable considerations.
The relative benefits received by the Company on the one hand and the
U.S. Underwriters on the other hand in connection with the offering of the U.S.
Securities pursuant to this Agreement shall be deemed to be in the same
respective proportions as the total net proceeds from the offering of the U.S.
Securities pursuant to this Agreement (before deducting expenses) received by
the Company and the total underwriting discount and commissions received by the
U.S. Underwriters, in each case as set forth on the cover of the U.S.
Prospectus, or, if Rule 434 is used, the corresponding location on the Term
Sheet, bear to the aggregate initial public offering price of the U.S.
Securities as set forth on such cover.
The relative fault of the Company on the one hand and the U.S.
Underwriters on the other hand shall be determined by reference to, among other
25
things, whether any such untrue or alleged untrue statement of a material fact
or omission or alleged omission to state a material fact relates to information
supplied by the Company or by the U.S. Underwriters and the parties' relative
intent, knowledge, access to information and opportunity to correct or prevent
such statement or omission or any violation of the nature referred to in Section
6(a)(ii)(A) hereof.
The Company and the U.S. Underwriters agree that it would not be just
and equitable if contribution pursuant to this Section 7 were determined by pro
rata allocation (even if the U.S. Underwriters 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 7. The
aggregate amount of losses, liabilities, claims, damages and expenses incurred
by an indemnified party and referred to above in this Section 7 shall be deemed
to include any legal or other expenses reasonably incurred by such indemnified
party in investigating, preparing or defending against any litigation, or any
investigation or proceeding by any governmental agency or body, commenced or
threatened, or any claim whatsoever based upon any such untrue or alleged untrue
statement or omission or alleged omission.
Notwithstanding the provisions of this Section 7, no U.S. Underwriter
shall be required to contribute any amount in excess of the amount by which the
total price at which the U.S. Securities underwritten by it and distributed to
the public were offered to the public exceeds the amount of any damages which
such U.S. Underwriter has otherwise been required to pay by reason of any such
untrue or alleged untrue statement or omission or alleged omission.
No person guilty of fraudulent misrepresentation (within the meaning of
Section 11(f) of the 0000 Xxx) shall be entitled to contribution from any person
who was not guilty of such fraudulent misrepresentation.
For purposes of this Section 7, each person, if any, who controls U.S.
Underwriter within the meaning of Section 15 of the 1933 Act or Section 20 of
the 1934 Act shall have the same rights to contribution as such U.S.
Underwriter, and each director of the Company, each officer of the Company who
signed the Registration Statement, and each person, if any, who controls the
Company within the meaning of Section 15 of the 1933 Act or Section 20 of the
1934 Act shall have the same rights to contribution as the Company. The U.S.
Underwriters' respective obligations to contribute pursuant to this Section 7
are several in proportion to the number of Initial U.S. Securities set forth
opposite their respective names in Schedule A hereto and not joint.
26
SECTION 8. Representations, Warranties and Agreements to Survive
Delivery. All representations, warranties and agreements contained in this
Agreement or in certificates of officers of the Company or any of its
Subsidiaries or its Material Holdings submitted pursuant hereto, shall remain
operative and in full force and effect, regardless of any investigation made by
or on behalf of any U.S. Underwriter or controlling person, or by or on behalf
of the Company, and shall survive delivery of the Securities to the U.S.
Underwriters.
SECTION 9. Termination of Agreement.
(a) Termination; General. The U.S. Representatives may terminate this
Agreement, by notice to the Company, at any time at or prior to Closing Time (i)
if there has been, since the time of execution of this Agreement or since the
respective dates as of which information is given in the U.S. Prospectus, any
material adverse change in the condition, financial or otherwise, or in the
earnings, business affairs or business prospects of the Company and its
Subsidiaries considered as one enterprise, whether or not arising in the
ordinary course of business, or (ii) if there has occurred any material adverse
change in the financial markets in the United States or the international
financial markets, any outbreak of hostilities or escalation thereof or other
calamity or crisis or any change or development involving a prospective change
in national or international political, financial or economic conditions, in
each case the effect of which is such as to make it, in the judgment of the U.S.
Representatives, impracticable to market the Securities or to enforce contracts
for the sale of the Securities, or (iii) if trading in any securities of the
Company has been suspended or materially limited by the Commission or the Nasdaq
National Market, or if trading generally on the New York Stock Exchange or in
the Nasdaq National Market has been suspended or materially limited, or minimum
or maximum prices for trading have been fixed, or maximum ranges for prices have
been required, by any of said exchanges or by such system or by order of the
Commission, the National Association of Securities Dealers, Inc. or any other
governmental authority, or (iv) if a banking moratorium has been declared by
either Federal or New York authorities.
(b) Liabilities. If this Agreement is terminated pursuant to this
Section, such termination shall be without liability of any party to any other
party except as provided in Section 4 hereof, and provided further that Sections
1, 6, 7 and 8 shall survive such termination and remain in full force and
effect.
SECTION 10. Default by One or More of the U.S. Underwriters. If one or
more of the U.S. Underwriters shall fail at Closing Time or a Date of Delivery
to purchase the Securities which it or they are obligated to purchase under this
Agreement (the "Defaulted Securities"), the U.S. Representatives shall have the
right, within 24 hours thereafter, to make arrangements for one or more of the
27
non-defaulting U.S. Underwriters, or any other underwriters, to purchase all,
but not less than all, of the Defaulted Securities in such amounts as may be
agreed upon and upon the terms herein set forth; if, however, the U.S.
Representatives shall not have completed such arrangements within such 24-hour
period, then:
(a) if the number of Defaulted Securities does not exceed 10% of the
number of U.S. Securities to be purchased on such date, each of the
non-defaulting U.S. Underwriters shall be obligated, severally and not jointly,
to purchase the full amount thereof in the proportions that their respective
underwriting obligations hereunder bear to the underwriting obligations of all
non-defaulting U.S. Underwriters, or
(b) if the number of Defaulted Securities exceeds 10% of the number of
U.S. Securities to be purchased on such date, this Agreement or, with respect to
any Date of Delivery which occurs after the Closing Time, the obligation of the
U.S. Underwriters to purchase and of the Company to sell the Option Securities
to be purchased and sold on such Date of Delivery shall terminate without
liability on the part of any non-defaulting U.S. Underwriter.
No action taken pursuant to this Section shall relieve any defaulting
U.S. Underwriter from liability in respect of its default.
In the event of any such default which does not result in a termination
of this Agreement or, in the case of a Date of Delivery which is after the
Closing Time, which does not result in a termination of the obligation of the
U.S. Underwriters to purchase and the Company to sell the relevant U.S. Option
Securities, as the case may be, either the U.S. Representatives or the Company
shall have the right to postpone Closing Time or the relevant Date of Delivery,
as the case may be, for a period not exceeding seven days in order to effect any
required changes in the Registration Statement or Prospectus or in any other
documents or arrangements. As used herein, the term "U.S. Underwriter" includes
any person substituted for a U.S. Underwriter under this Section 10.
SECTION 11. Notices. All notices and other communications hereunder
shall be in writing and shall be deemed to have been duly given if mailed or
transmitted by any standard form of telecommunication. Notices to the U.S.
Underwriters shall be directed to the U.S. Representatives at North Tower, World
Financial Center, New York, New York 10281-1201, attention of Xxxxxxx Xxxxxxx,
Esq.; and notices to the Company shall be directed to it at Building 800, 000
Xxxxx Xxxx Xxxxx, Xxxxx, Xxxxxxxxxxxx 00000, attention of Xxxxx X.
Nassau, Esq.
28
SECTION 12. Parties. This Agreement shall each inure to the benefit of
and be binding upon the U.S. Underwriters and the Company and their respective
successors. Nothing expressed or mentioned in this Agreement is intended or
shall be construed to give any person, firm or corporation, other than the U.S.
Underwriters and the Company and their respective successors and the controlling
persons and officers and directors referred to in Sections 6 and 7 and their
heirs and legal representatives, any legal or equitable right, remedy or claim
under or in respect of this Agreement or any provision herein contained. This
Agreement and all conditions and provisions hereof are intended to be for the
sole and exclusive benefit of the U.S. Underwriters and the Company and their
respective successors, and said controlling persons and officers and directors
and their heirs and legal representatives, and for the benefit of no other
person, firm or corporation. No purchaser of Securities from any U.S.
Underwriter shall be deemed to be a successor by reason merely of such purchase.
SECTION 13. GOVERNING LAW AND TIME. THIS AGREEMENT SHALL BE GOVERNED
BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK.
SPECIFIED TIMES OF DAY REFER TO NEW YORK CITY TIME.
SECTION 14. Effect of Headings. The Article and Section headings
herein and the Table of Contents are for convenience only and shall not affect
the construction hereof.
29
If the foregoing is in accordance with your understanding of our
agreement, please sign and return to the Company a counterpart hereof, whereupon
this instrument, along with all counterparts, will become a binding agreement
between the U.S. Underwriters and the Company in accordance with its terms.
Very truly yours,
INTERNET CAPITAL GROUP, INC.
By
---------------------------------
Title:
CONFIRMED AND ACCEPTED,
as of the date first above written:
XXXXXXX XXXXX & CO.
XXXXXXX LYNCH, PIERCE, XXXXXX & XXXXX
INCORPORATED
XXXXXXX, SACHS & CO.
DEUTSCHE BANK SECURITIES INC.
XXXXXX BROTHERS INC.
BANCBOSTON XXXXXXXXX XXXXXXXX INC.
By: XXXXXXX LYNCH, PIERCE, XXXXXX & XXXXX
INCORPORATED
By
---------------------------------------
Authorized Signatory
For itself and as U.S. Representative of the
other U.S. Underwriters named in Schedule A hereto.
SCHEDULE A
Number of
Initial U.S.
Name of U.S. Underwriter Securities
------------------------ ------------
Xxxxxxx Lynch, Pierce, Xxxxxx & Xxxxx
Incorporated............................................
Xxxxxxx, Sachs & Co..............................................
Deutsche Bank Securities Inc.....................................
Xxxxxx Brothers Inc..............................................
BancBoston Xxxxxxxxx Xxxxxxxx Inc................................
Total
============
Sch A-1
SCHEDULE B
INTERNET CAPITAL GROUP, INC.
4,800,000 Shares of Common Stock
(Par Value $.001 Per Share)
The public offering price per share for the Securities, determined as
provided in said Section 2, shall be $ .
The purchase price per share for the U.S. Securities to be paid by the
several U.S. Underwriters shall be $ , being an amount equal to the public
offering price set forth above less $ per share; provided that the purchase
price per share for any U.S. Option Securities purchased upon the exercise of
the over-allotment option described in Section 2(b) shall be reduced by an
amount per share equal to any dividends or distributions declared by the Company
and payable on the Initial U.S. Securities but not payable on the U.S.
Option Securities.
Sch B-1
Exhibit A
FORM OF OPINION OF DECHERT PRICE & XXXXXX
TO BE DELIVERED PURSUANT TO
SECTION 5(b)
The Company has been duly incorporated and is validly
existing as a corporation in good standing under the laws of
the State of Delaware.
The Company has corporate power and corporate authority to
own, lease and operate its properties and to conduct its
business as described in the Prospectuses and to enter into
and perform its obligations under the U.S. Purchase
Agreement, the International Purchase Agreement and the
Convertible Note Purchase Agreement.
The Company is duly qualified as a foreign corporation to
transact business and is in good standing in each of
Pennsylvania, Massachusetts and California.
The Company has authorized, issued and outstanding shares
of capital stock as set forth in the Prospectuses under the
caption "Capitalization" (except for subsequent issuances,
if any, pursuant to the U.S. Purchase Agreement and the
International Purchase Agreement or pursuant to
reservations, agreements or employee benefit plans referred
to in the Prospectuses or pursuant to the exercise of
convertible securities or options referred to in the
Prospectuses); the shares of issued and outstanding capital
stock have been duly authorized and validly issued and are
fully paid and non-assessable; and none of the outstanding
shares of capital stock of the Company was issued in
violation of the preemptive or other similar rights of any
securityholder of the Company.
The Securities and the Convertible Notes to be sold by the
Company have been duly authorized for issuance and sale
pursuant to the U.S. Purchase Agreement, the International
Purchase Agreement and the Convertible Note Purchase
Agreement, respectively, and, when issued and delivered by
the Company pursuant thereto, against payment of the
consideration set forth therein, will be validly issued and
fully
Ex. A-1
paid and non-assessable and no holder of the Securities or
the Convertible Notes is or will be subject to personal
liability by reason of being such a holder.
The issuance of the Securities and the Convertible Notes is
not subject to the preemptive or other similar rights of any
securityholder of the Company.
Each majority-owned subsidiary and Material Holding has been
duly incorporated and is validly existing as a corporation
in good standing under the laws of the jurisdiction of its
incorporation, has corporate power and corporate authority
to own, lease and operate its properties and to conduct its
business as described in the Prospectuses; except as
otherwise disclosed in the Registration Statement, the
issued and outstanding capital stock of each majority-owned
subsidiary or Material Holding owned by the Company has been
duly authorized and validly issued, is fully paid and
non-assessable and, to the best of our knowledge, is owned
by the Company, directly or through majority-owned
subsidiaries, free and clear of any security interest,
mortgage, pledge, lien, encumbrance, claim or equity other
than to the lenders under the revolving bank credit
facility; and none of the outstanding shares of capital
stock of any subsidiary or Material Holding owned by the
Company was issued in violation of the preemptive or similar
rights of any securityholder of each subsidiary or Material
Holding.
Each of the U.S. Purchase Agreement, the International
Purchase Agreement and the Convertible Note Purchase
Agreement has been duly authorized executed and delivered by
the Company.
The Registration Statement, including any Rule 462(b)
Registration Statement, has been declared effective under
the 1933 Act; any required filing of the Prospectuses
pursuant to Rule 424(b) has been made in the manner and
within the time period required by Rule 424(b); and, to the
best of our knowledge, no stop order suspending the
effectiveness of the Registration Statement or any Rule
462(b) Registration Statement has been issued under the 1933
Act and no proceedings for that purpose have been instituted
or are pending or threatened by the Commission.
Ex. A-2
The Registration Statement, including any Rule 462(b)
Registration Statement, the Rule 430A Information and the
Rule 434 Information, as applicable, the Prospectuses and
each amendment or supplement to the Registration Statement
and the Prospectuses as of their respective effective or
issue dates (other than the financial statements, supporting
schedules and other financial data included therein or
omitted therefrom, as to which we need express no opinion)
complied as to form in all material respects with the
requirements of the 1933 Act and the 1933 Act Regulations.
The form of certificate used to evidence the Common Stock
complies in all material respects with all applicable
statutory requirements, with any applicable requirements of
the Certificate of Incorporation and by-laws of the Company
and the requirements of the Nasdaq National Market.
To our knowledge, there is not pending or threatened any
action, suit, proceeding, inquiry or investigation, to which
the Company or any majority-owned subsidiary is a party, or
to which the property of the Company or any majority-owned
subsidiary is subject, before or brought by any court or
governmental agency or body, domestic or foreign, which
might reasonably be expected to result in a Material Adverse
Effect with respect to the Company, or which might
reasonably be expected to materially and adversely affect
the properties or assets thereof or the consummation of the
transactions contemplated in the U.S. Purchase Agreement,
International Purchase Agreement and the Convertible Note
Purchase Agreement or the performance by the Company of its
obligations thereunder.
The information in the Prospectuses and in the Registration
Statement to the extent that it constitutes matters of law,
summaries of legal matters, the Company's Certificate of
Incorporation and bylaws or legal proceedings, or legal
conclusions, has been reviewed by us and is correct in all
material respects.
To our knowledge, there are no statutes or regulations that
are required to be described in the Prospectuses that are
not described as required.
Ex. A-3
All descriptions in the Prospectuses of contracts and other
documents to which the Company, its majority-owned
subsidiaries or its Material Holdings are a party are
accurate in all material respects; to our knowledge, there
are no franchises, contracts, indentures, mortgages, loan
agreements, notes, leases or other instruments required to
be described or referred to in the Registration Statement or
to be filed as exhibits thereto other than those described
or referred to therein or filed or incorporated by reference
as exhibits thereto, and the descriptions thereof or
references thereto are correct in all material respects.
To our knowledge, neither the Company nor any of its
majority-owned subsidiaries nor any Material Holdings is in
violation of its charter or by-laws and no default by the
Company or any majority-owned subsidiary or Material Holding
exists in the due performance or observance of any material
obligation, agreement, covenant or condition contained in
any contract, indenture, mortgage, loan agreement, note,
lease or other agreement or instrument that is described or
referred to in the Registration Statement or the
Prospectuses or filed or incorporated by reference as an
exhibit to the Registration Statement.
No filing with, or authorization, approval, consent,
license, order, registration, qualification or decree of,
any court or governmental authority or agency, domestic or
foreign (other than under the 1933 Act and the 1933 Act
Regulations, which have been obtained, or as may be required
under the securities or blue sky laws of the various states,
as to which we need express no opinion) is necessary or
required in connection with the due authorization, execution
and delivery of the U.S. Purchase Agreement, the
International Purchase Agreement and the Convertible Note
Purchase Agreement or for the offering, issuance, sale or
delivery of the Securities.
The execution, delivery and performance of the U.S. Purchase
Agreement, the International Purchase Agreement and the
Convertible Note Purchase Agreement and the consummation of
the transactions contemplated therein and in the
Registration Statement (including the issuance and sale of
the Securities, and the use of the proceeds from the sale of
the
Ex. A-4
Securities as described in the Prospectuses under the
caption "Use Of Proceeds") and compliance by the Company
with its obligations thereunder do not and will not, whether
with or without the giving of notice or lapse of time or
both, conflict with or constitute a breach of, or default or
Repayment Event (as defined in Section 1(a)(x) of the
Purchase Agreements) under or result in the creation or
imposition of any lien, charge or encumbrance upon any
property or assets of the Company or any of its majority-
owned subsidiaries or Material Holdings pursuant to any
contract, indenture, mortgage, deed of trust, loan or credit
agreement, note, lease or any other agreement or instrument,
known to us, to which the Company or any of its majority-
owned subsidiaries or Material Holdings is a party or by
which it or any of them may be bound, or to which any of the
property or assets of the Company or any of its majority-
owned subsidiaries or Material Holdings is subject (except
for such conflicts, breaches or defaults or liens, charges
or encumbrances that would not have a Material Adverse
Effect), nor will such action result in any violation of the
provisions of the charter or by-laws of the Company or any
of its majority-owned subsidiaries or Material Holdings or
any applicable law, statute, rule, regulation, judgment,
order, writ or decree, known to us, of any government,
government instrumentality or court, domestic or foreign,
having jurisdiction over the Company or any majority-owned
subsidiary or Material Holding or any of their respective
properties, assets or operations.
To the best of our knowledge, other than rights that have
been waived, there are no persons with registration rights
or other similar rights to have any securities registered
pursuant to the Registration Statement or otherwise
registered by the Company under the 1933 Act, except as
disclosed in the Registration Statement.
To our knowledge, there are no pending or threatened claims of
infringement of any material patent, trademark, service xxxx or copyright or of
misappropriation of trade secrets, necessary for the Company to conduct the
business currently conducted by it, the unfavorable outcome of which could
reasonably be expected to have a material adverse effect on the Company and that
are required to be described in the Registration Statement or the Prospectus but
are not described as required.
Ex. A-5
We have no knowledge that the Company will be unable to operate under
any current license of a patent, trademark, service xxxx, copyright or trade
secret, which license is necessary for the Company to conduct the business
currently conducted by it.
Nothing has come to our attention that would lead us to believe that the
Registration Statement or any amendment thereto, including the Rule 430A
Information and Rule 434 Information (if applicable), (except for financial
statements and schedules and other financial data included therein or omitted
therefrom, as to which we need make no statement), at the time such Registration
Statement or any such amendment became effective, contained an untrue statement
of a material fact or omitted to state a material fact required to be stated
therein or necessary to make the statements therein not misleading or that the
Prospectuses or any amendment or supplement thereto (except for financial
statements and schedules and other financial data included therein or omitted
therefrom, as to which we need make no statement), at the time the Prospectuses
were issued, at the time any such amended or supplemented prospectus was issued
or at the Closing Time, included or includes an untrue statement of a material
fact or omitted or omits to state a material fact necessary in order to make the
statements therein, in the light of the circumstances under which they were
made, not misleading.
In rendering such opinion, such counsel may rely as to matters of fact
(but not as to legal conclusions), to the extent they deem proper, on
certificates of responsible officers of the Company and public officials.
Ex. A-6
Exhibit B
FORM OF OPINION OF XXXXX XXXX & XXXXXXXX
TO BE DELIVERED PURSUANT TO
SECTION 5(b)
(i) The Company is not, and upon the issuance and sale of the Securities
and the Convertible Notes and the application of the net proceeds therefrom as
described in the Prospectuses will not be, required to register as an
"investment company" under the Investment Company Act of 1940, as amended.
Ex. B-1
[Form of lock-up from directors, officers or
other stockholders pursuant to Section 5(i)]
Xxxxxxx X
, 0000
XXXXXXX XXXXX & CO.
Xxxxxxx Lynch, Pierce, Xxxxxx & Xxxxx
Incorporated,
Xxxxxxx, Sachs & Co.
Deutsche Bank Securities Inc.
BancBoston Xxxxxxxxx Xxxxxxxx Inc.
Xxxxxx Brothers Inc.
as U.S. Representatives of the several
U.S. Underwriters to be named in the
within-mentioned U.S. Purchase Agreement
x/x Xxxxxxx Xxxxx & Xx.
Xxxxxxx Lynch, Pierce, Xxxxxx & Xxxxx
Incorporated
Xxxxx Xxxxx
Xxxxx Xxxxxxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000-0000
Re: Proposed Public Offering by Internet Capital Group, Inc.
--------------------------------------------------------
Dear Sirs:
The undersigned, a stockholder, officer or director of Internet Capital
Group, Inc., a Delaware corporation (the "Company"), understands that Xxxxxxx
Xxxxx & Co., Xxxxxxx Lynch, Pierce, Xxxxxx & Xxxxx Incorporated ("Xxxxxxx
Xxxxx"), Xxxxxxx, Xxxxx & Co., Deutsche Bank Securities Inc., Xxxxxx Brothers
Inc. and BancBoston Xxxxxxxxx Xxxxxxxx Inc. propose to enter into a U.S.
Purchase Agreement (the "U.S. Purchase Agreement") with the Company providing
for the public offering of shares (the "Securities") of the Company's common
stock, par value $.001 per share (the "Common Stock"). In recognition of the
benefit that such an offering will confer upon the undersigned as a stockholder,
officer or director of the Company, and for other good and valuable
consideration, the receipt and sufficiency of which are hereby acknowledged, the
undersigned agrees with each underwriter to be named in the U.S. Purchase
Agreement that, during a period of 180 days from the date of the U.S. Purchase
Agreement, the undersigned will not, without the prior written consent of
Xxxxxxx Xxxxx, directly or indirectly, (i) offer, pledge, sell, contract to
sell, sell any option or contract to purchase, purchase any
Ex. C-1
option or contract to sell, grant any option, right or warrant for the sale of,
or otherwise dispose of or transfer any shares of the Company's Common Stock or
any securities convertible into or exchangeable or exercisable for Common Stock,
whether now owned or hereafter acquired by the undersigned or with respect to
which the undersigned has or hereafter acquires the power of disposition, or
file any registration statement under the Securities Act of 1933, as amended,
with respect to any of the foregoing or (ii) enter into any swap or any other
agreement or any transaction that transfers, in whole or in part, directly or
indirectly, the economic consequence of ownership of the Common Stock, whether
any such swap or transaction is to be settled by delivery of Common Stock or
other securities, in cash or otherwise.
Very truly yours,
[insert name of beneficial owner of
shares/officer/director]
by:
----------------------------------
Name: [insert name of signatory]
Title: [if signing on before of a
corporation, insert title]
Ex. C-2
