STOCK PURCHASE AGREEMENT
This STOCK PURCHASE AGREEMENT (this "Agreement") is made and entered
into this 26th day of April, 2000 by and between Cantor Xxxxxxxxxx Securities
(the "Seller"), and eSpeed, Inc., (the "Purchaser").
WHEREAS, simultaneously herewith, the Seller, the Purchaser and two
diversified energy companies, Dynegy, Inc. and The Xxxxxxxx Companies, Inc.
(each an "Anchor" and collectively the "Anchors") have entered into a business
relationship pursuant to which they will cooperate together to establish a
series of new marketplaces for the electronic and telephonic exchange of energy
and certain other products (the "Business Relationship");
WHEREAS, each Anchor has agreed, pursuant to a Subscription Agreement
dated of even date hereof with the Purchaser, to which Seller is also a party
(the "Subscription Agreement"), to make an equity investment in the Purchaser
consisting, in pertinent part, of the purchase of 789,071 shares (or an
aggregate of 1,578,142 shares for the 2 Anchors) of Class A Common Stock, par
value $.01 per share, of the Purchaser (the "Class A Common Stock");
WHEREAS, subject to the satisfaction of certain conditions relating to
investments in Qualified Verticals (as defined in the Subscription Agreement),
each Anchor has the right to make up to 4 additional investments of $25.0
million each in restricted shares of Class A Common Stock of the Company, at a
10% discount to the 10 Trading Day Average (as defined in the Subscription
Agreement) preceding the Purchaser's investment in the Qualified Vertical (the
"Additional Investment Right");
WHEREAS, in furtherance of the Business Relationship and the
transactions contemplated thereby, the Seller is willing to sell, and the
Purchaser is willing to purchase, shares of Class B Common Stock of Purchaser,
par value $.01 per share, ("Class B Common Stock") representing (x) an aggregate
of 789,071 shares, representing half of the number of shares being sold to the
Anchors by Purchaser (the "Initial Shares"), and (y) each time an Additional
Investment Right is exercised, half of the number of shares purchased by the
Anchors, in the aggregate (the "Additional Shares"), in connection with each
such exercise, all subject to the terms and conditions set forth herein;
WHEREAS, the purchase of the Initial Shares hereunder shall be
contingent upon, and consummated simultaneously with the Closing (as defined in
the Subscription Agreement), which is hereafter referred to as the "Subscription
Agreement Closing"; and
WHEREAS, the purchase of the Additional Shares hereunder shall be
contingent upon, and consummated simultaneously with, the closing of each
Additional Investment Right.
NOW, THEREFORE, in consideration of the premises and of the mutual
agreements and covenants hereinafter set forth, and for good and valuable
consideration, the receipt and sufficiency of which are hereby acknowledged, the
Seller and the Purchaser, intending to be legally bound, hereby agree as
follows:
1. Terms of Purchase.
1.1 Sale and Purchase of the Initial Shares. The Seller agrees to sell
to the Purchaser, and the Purchaser agrees to purchase from the Seller, the
Initial Shares for an aggregate cash purchase price of $25.0 million (the
"Purchase Price"). The Purchase Price shall be payable by wire transfer to an
account designated by Seller.
1.2 Sale and Purchase of the Additional Shares. The Seller agrees to
sell to the Purchaser, and the Purchaser agrees to purchase from the Seller,
such number of Additional Shares (including shares purchased from the Company
upon exercise of a put or call as defined in Section 3(h) of the Subscription
Agreement), as shall equal half of the Additional Shares purchased from the
Anchors in the aggregate, upon each exercise of an Additional Investment Right,
provided that the Additional Shares shall be Class B Common Stock of Purchaser
(unless the Seller shall determine to substitute Class A Common Stock). The
purchase price per share of the Additional Shares (each referred to herein as
the "Additional Share Purchase Price") shall be the same purchase price per
share as is paid by the Anchors for the Class A Common Stock purchased by them
pursuant to the applicable exercise of an Additional Investment Right. The
Additional Share Purchase Price shall be payable by wire transfer to an account
designated by Seller. In the event that as a result of a recapitalization or
other similar transaction involving Purchaser, whether effected as a merger,
consolidation or otherwise, the Purchaser agrees with the Anchors that the
shares available for purchase upon exercise of an Additional Investment Right
shall consist of one or more securities which are issued or received in exchange
for the Class A Common Stock or Class B Common Stock of the Company, then the
provisions of this Section 1.2 and other Sections of this Agreement related
thereto, shall be deemed to include the security or securities so substituted.
1.3 Initial Closing. The closing (the "Share Purchase Closing") of the
sale of the Initial Shares by the Seller to the Purchaser shall take place at
the offices of Purchaser, on the date of the Subscription Agreement Closing or
at such other time and place as the Seller and the Purchaser shall mutually
agree upon. At the Share Purchase Closing, the Seller shall deliver to the
Purchaser the Initial Shares against payment of the Purchase Price.
1.4 Closings of Additional Investment Rights. The closing for each
Additional Share Purchase (each an "Additional Share Closing") shall take place
at the offices of Purchaser on the date of closing of each Additional Investment
Right (each an "Additional Investment Right Closing") or at such other time and
place as the Seller and Purchase shall mutually agree upon. At each Additional
Share Closing, the Seller shall deliver the Additional Shares to the Purchaser
against payment of the Additional Share Purchase Price.
2. Representations and Warranties of the Seller
The Seller hereby makes the following representations and warranties to
the Purchaser:
2.1 Organization of the Seller. The Seller is duly organized, validly
existing and in good standing under the laws of the jurisdiction of its
organization and has all requisite corporate power and authority to carry on its
business as now being conducted.
2.2 Authority. The Seller has all requisite corporate power and
authority to enter into this Agreement and to perform all of its obligations
hereunder. The execution, delivery and performance of this Agreement and the
other documents and instruments to be executed by Seller pursuant hereto and the
consummation of the transactions contemplated hereby have been duly authorized
by all necessary corporate action on the part of the Seller. This Agreement has
been duly executed and delivered by the Seller and, assuming due authorization,
execution and delivery by the Purchaser, this Agreement constitutes the valid
and binding agreement of the Seller, enforceable against it in accordance with
its terms, except as may be limited by bankruptcy, moratorium and insolvency
laws and other laws affecting the rights of creditors' generally and except as
may be limited by the availability of equitable remedies.
2.3 No Conflict. The execution and delivery of this Agreement and the
consummation of the transactions contemplated hereby will not, (i) conflict
with, or result in any violation or breach of, any provision of the Certificate
of Incorporation or Bylaws or other operative organizational documents of the
Seller, (ii) result in any violation or breach of, or constitute (with or
without notice or lapse of time, or both) a default (or give rise to a right of
termination, cancellation or acceleration of any obligation or loss of any
material benefit) under, or require a consent or waiver under, any of the terms,
conditions or provisions of any note, bond, mortgage, indenture, lease, contract
or other agreement, instrument or obligation to which the Seller or any of its
Subsidiaries is a party, or (iii) conflict with or violate any permit,
concession, franchise, license, judgment, order, decree, statute, law,
ordinance, rule or regulation applicable to the Seller or any of its
Subsidiaries or any its or their properties or assets, except in the case of
clauses (ii) and (iii) for any such conflicts, violations, breaches, defaults,
terminations, cancellations or accelerations which are not, individually or in
the aggregate, reasonably likely to have a material adverse effect on Seller and
its subsidiaries taken as a whole or on Seller's ability to consummate the
transactions contemplated hereby.
2.4 Ownership of the Shares. The Seller owns and has good and
marketable title to the Initial Shares and the Additional Shares, free from all
liens, claims and encumbrances. At the Share Purchase Closing or Additional
Share Closing, as the case may be, the Purchaser will receive good and
marketable title to the Initial Shares or Additional Shares, as the case may be,
free from all liens, claims and encumbrances.
3. Representations and Warranties of the Purchaser.
The Purchaser hereby makes the following representations and warranties
to the Seller:
3.1 Organization of the Purchaser and its Subsidiaries. The Purchaser
is duly organized, validly existing and in good standing under the laws of the
jurisdiction of its organization and has all requisite corporate power and
authority to carry on its business as now being conducted.
3.2 Authority. The Purchaser has all requisite corporate power and
authority to enter into this Agreement and to perform all of its obligations
hereunder. The execution, delivery and performance of this Agreement and the
other documents and instruments to be executed by Purchaser pursuant hereto and
the consummation of the transactions contemplated hereby have been duly
authorized by all necessary corporate action on the part of the Purchaser. This
Agreement has been duly executed and delivered by the Purchaser and, assuming
due authorization, execution and delivery by the Seller, this Agreement
constitutes the valid and binding agreement of the Purchaser, enforceable
against it in accordance with its terms, except as may be limited by bankruptcy,
moratorium and insolvency laws and other laws affecting the rights of creditors'
generally and except as may be limited by the availability of equitable
remedies.
3.3 No Conflict. The execution and delivery of this Agreement and the
consummation of the transactions contemplated hereby will not, (i) conflict
with, or result in any violation or breach of, any provision of the Certificate
of Incorporation or Bylaws or other operative organizational documents of the
Purchaser, (ii) result in any violation or breach of, or constitute (with or
without notice or lapse of time, or both) a default (or give rise to a right of
termination, cancellation or acceleration of any obligation or loss of any
material benefit) under, or require a consent or waiver under, any of the terms,
conditions or provisions of any note, bond, mortgage, indenture, lease, contract
or other agreement, instrument or obligation to which the Purchaser or any of
its Subsidiaries is a party, or (iii) conflict with or violate any permit,
concession, franchise, license, judgment, order, decree, statute, law,
ordinance, rule or regulation applicable to the Purchaser or any of its
Subsidiaries or any its or their properties or assets, except in the case of
clauses (ii) and (iii) for any such conflicts, violations, breaches, defaults,
terminations, cancellations or accelerations which are not, individually or in
the aggregate, reasonably likely to have a material adverse effect on Purchaser
and its subsidiaries, taken as a whole, or on Purchaser's ability to consummate
the transactions contemplated hereby.
4. Conditions to the Obligations of the Purchaser.
The Purchaser's obligation to purchase and pay for the Initial Shares
or the Additional Shares, as the case may be, shall be subject to the
satisfaction, at or before the Share Purchase Closing, or the applicable
Additional Share Closing, as the case may be, of the following conditions (any
of which may be waived, in whole or in part, by the Purchaser):
4.1 Representations and Warranties. All of the representations and
warranties of the Seller made in this Agreement shall have been true and
accurate in all material respects as of the date hereof and as of the Share
Purchase Closing or the applicable Additional Share Closing, as the case may be.
4.2 Delivery of Shares. Concurrently with the Share Purchase Closing,
or the applicable Additional Share Closing, as the case may be, the Seller shall
deliver to the Purchaser good and marketable title to the Initial Shares or
Additional Shares as the case may be, free from all liens, claims and
encumbrances.
4.3 Subscription Agreement Closing or Additional Investment Right
Closing. The Subscription Agreement Closing or the applicable Additional
Investment Right Closing, as the case may be, shall have occurred.
5. Conditions to the Obligation of the Seller.
The Seller's obligation to sell, convey, transfer and assign the
Initial Shares or the Additional Shares, as the case may be, shall be subject to
the satisfaction, at or before the Share Purchase Closing, or the applicable
Additional Share Closing, as the case may be, of the following conditions (any
of which may be waived, in whole or in part, by the Seller):
5.1 Representations and Warranties. All of the representations and
warranties of the Purchaser in this Agreement shall have been true and accurate
in all material respects as of the date hereof and as of the Share Purchase
Closing or the applicable Additional Share Closing, as the case may be.
5.2 Closing of the Transaction Documents. The Subscription Agreement
Closing or the applicable Additional Investment Right Closing, as the case may
be shall have occurred.
5.3 Purchase Price. The Seller shall have received from the Purchaser,
by wire transfer of immediately available funds, an amount in cash equal to the
Purchase Price or the Additional Share Purchase Price, as the case may be.
6. Further Assurances. Subject to the terms and conditions hereof, each
party agrees that after the Share Purchase Closing or Additional Share Closing,
as the case may be, it will execute and deliver such documents as the other
party may reasonably request in order to consummate the transactions
contemplated hereby.
7. Termination and Waiver.
7.1 Termination. This Agreement may be terminated at any time by either
party if the Subscription Agreement with each Anchor shall be terminated or
otherwise by mutual agreement of the parties.
7.2 Waiver. Each of the parties hereto may (i) extend the time for the
performance of any of the obligations or other acts of any other party hereto,
(ii) waive any inaccuracies in the representations and warranties contained
herein or in any document delivered pursuant hereto, or (iii) waive compliance
with any of the covenants, agreements or conditions contained herein. Any
agreement on the part of a party hereto to any such extension or waiver shall be
valid only if
set forth in a written instrument signed by the party granting
such waiver. Such waiver or failure to insist upon strict compliance with such
obligation, covenant, agreement or condition shall not operate as a waiver of,
or estoppel with respect to, any subsequent or future failure.
8. Miscellaneous.
8.1 Headings. Section headings contained in this Agreement are
included for convenience only and shall not affect the interpretation of any
provisions of this Agreement.
8.2 Notices. Any notice, demand, request, waiver, or other
communication under this Agreement shall be in writing (including facsimile or
similar writing) and shall be deemed to have been duly given (i) on the date of
service if personally served, (ii) on the third day after mailing if mailed to
the party to whom notice is to be given, by first class mail, registered, return
receipt requested, postage prepaid or (iii) on the date sent if sent by
facsimile, to the parties at the following addresses or facsimile numbers with a
copy sent by mail as aforesaid on the same date (or at such other address or
facsimile number for a party as shall be specified by like notice):
If to the Purchaser, to: eSpeed, Inc.
Xxx Xxxxx Xxxxx Xxxxxx
000xx Xxxxx
Xxx Xxxx, XX 00000
Fax: (000) 000-0000
Attention: General Counsel
If to the Seller, to: Cantor Xxxxxxxxxx Securities
Xxx Xxxxx Xxxxx Xxxxxx
000xx Xxxxx
Xxx Xxxx, XX 00000
Fax: (000) 000-0000
Attention: General Counsel
8.3 Successors and Assigns. This Agreement shall be binding upon and
inure to the benefit of the parties hereto and their respective successors and
assigns. Neither of the parties hereto shall assign any rights or delegate any
duties hereunder without the prior written consent of the other parties hereto,
and any assignment made without such consent shall be void and constitute a
default hereunder; provided that Seller may assign its obligation to sell Shares
or Additional Shares hereunder, in whole or in part, to a subsidiary or
affiliate of Seller that owns a sufficient number of shares of Class B Common
Stock to satisfy the assigned obligation.
8.4 Governing Law. This Agreement shall be construed in accordance
with, and governed by, the internal laws of the State of New York, without
giving effect to the principles of conflict of laws thereof.
8.5 Entire Agreement. This Agreement sets forth the entire
understanding and agreement of the parties with respect to its subject matter
and supersedes any and all prior
understandings, negotiations or agreements among the parties hereto, both
written and oral, with respect to such subject matter.
8.6 Counterparts. This Agreement may be executed in one or more
counterparts, each of which shall be deemed to be an original, but all of which,
when taken together, shall constitute one and the same agreement.
8.7 Severability. In the event that any one or more of the provisions
contained in this Agreement shall for any reason be held to be invalid, illegal
or unenforceable in any respect, in whole or in part, the validity of the
remaining provisions shall not be affected and the remaining portion of any
provision held to be invalid, illegal or unenforceable shall in no way be
affected, prejudiced or disturbed thereby.
8.8 No Prejudice. This Agreement has been jointly prepared and
negotiated by the parties hereto and the terms hereof shall not be construed in
favor of or against any party on account of its participation in such
preparation.
8.9 No Third Party Beneficiaries. This Agreement shall not confer any
rights or remedies upon any party other than the parties hereto and their
respective successors and permitted assigns.
8.10 Amendment and Modification. This Agreement may be amended or
modified only by written agreement executed by all parties hereto.
IN WITNESS WHEREOF, the Seller and the Purchaser have caused this
Agreement to be executed as of the date first written above.
eSpeed, Inc.
By: /s/ Xxxxxx X. Xxxxxxx
--------------------------------------------
Name: Xxxxxx X. Xxxxxxx
Title: Chairman and Chief Executive
Officer
Cantor Xxxxxxxxxx Securities
By: /s/ Xxxxxx X. Xxxxxxx
--------------------------------------------
Name: Xxxxxx X. Xxxxxxx
Title: President
