EXHIBIT 10.59
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SECURITIES PURCHASE AGREEMENT
among
iXL ENTERPRISES, INC.
and
THE INVESTORS NAMED HEREIN
2,000,000 Shares of Common Stock
and
Warrants to Purchase 1,500,000 Shares of Common Stock
Dated as of April 7, 1999
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Table of Contents
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Page
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ARTICLE I DEFINITIONS...................................................... 1
Section 1.1 Definitions...................................................... 1
Section 1.2 Rules of Construction............................................ 7
ARTICLE II PURCHASE AND SALE OF SECURITIES.................................. 7
Section 2.1 Issue and Sale of Securities..................................... 7
Section 2.2 Purchase and Sale of Securities.................................. 8
Section 2.3 Issue Taxes...................................................... 9
ARTICLE III CLOSING CONDITIONS............................................... 10
Section 3.1 Conditions to Obligations of the Investors....................... 10
Section 3.2 Conditions to Obligations of the Company......................... 13
ARTICLE IV REPRESENTATIONS AND WARRANTIES OF THE COMPANY.................... 14
Section 4.1 Due Incorporation and Good Standing.............................. 14
Section 4.2 Capitalization................................................... 14
Section 4.3 Subsidiaries..................................................... 15
Section 4.4 Authority........................................................ 15
Section 4.5 Authorization, Etc. of Shares.................................... 15
Section 4.6 Authorization, Etc. of Warrant Agreement and Warrant Shares...... 16
Section 4.7 No Violation or Conflict; No Default............................. 16
Section 4.8 No Material Adverse Change; Financial Statements................. 17
Section 4.9 Full Disclosure.................................................. 18
Section 4.10 Private Offering................................................. 18
Section 4.11 No Brokers....................................................... 19
Section 4.12 Litigation....................................................... 19
Section 4.13 Labor Relations.................................................. 19
Section 4.14 Taxes............................................................ 20
Section 4.15 Environmental Matters............................................ 21
Section 4.16 ERISA............................................................ 22
Section 4.17 Intellectual Property Rights..................................... 23
Section 4.18 Compliance with Laws............................................. 23
Section 4.19 Agreements....................................................... 24
Section 4.20 Year 2000........................................................ 24
Section 4.21 SEC Reports...................................................... 24
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ARTICLE V REPRESENTATIONS AND WARRANTIES OF EACH INVESTOR................................... 25
Section 5.1 Organization and Standing......................................................... 25
Section 5.2 Purchase for Own Account.......................................................... 25
Section 5.3 Accredited Investor; No Solicitation.............................................. 25
Section 5.4 Qualified Institutional Buyer..................................................... 26
Section 5.5 Authorization..................................................................... 26
Section 5.6 ERISA............................................................................. 26
ARTICLE VI COVENANTS......................................................................... 27
Section 6.1 Inspection of Properties and Records.............................................. 27
Section 6.2 Financial Statements.............................................................. 27
Section 6.3 Indemnification for Finder's Fees................................................. 28
Section 6.4 Publicity; Press Releases......................................................... 28
Section 6.5 Lock-Up........................................................................... 28
Section 6.6 HSR Filing........................................................................ 29
ARTICLE VII MISCELLANEOUS..................................................................... 29
Section 7.1 Notices........................................................................... 29
Section 7.2 Successors and Assigns............................................................ 30
Section 7.3 No Waivers; Amendments............................................................ 30
Section 7.4 Counterparts...................................................................... 31
Section 7.5 Section Headings.................................................................. 31
Section 7.6 GOVERNING LAW; SUBMISSION TO JURISDICTION; WAIVER OF JURY TRIAL................... 31
Section 7.7 Entire Agreement.................................................................. 32
Section 7.8 Severability...................................................................... 32
Section 7.9 Further Assurances................................................................ 32
Section 7.10 No Survival of Representations and Warranties; No Recourse........................ 32
Section 7.11 Termination....................................................................... 32
Section 7.12 Disclosure of Financial Information............................................... 33
Exhibit A - Form of Warrant Agreement
Exhibit B - Form of Xxxxxx & Xxxxxx Opinion
Exhibit C - Form of Agreement to be Bound to the Registration Rights Agreement
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SECURITIES PURCHASE AGREEMENT
This SECURITIES PURCHASE AGREEMENT (the "Agreement") is dated as of April
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7, 1999, and entered into by and among iXL Enterprises, Inc., a Delaware
corporation (the "Company"), and the investors listed on the signature pages
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hereto (each an "Investor" and collectively, the "Investors").
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In consideration of the mutual covenants and agreements set forth herein
and for other good and valuable consideration, the receipt and sufficiency of
which are hereby acknowledged, and intending to be legally bound hereby, the
Company agrees, and each of the Investors agrees, severally but not jointly, as
follows:
ARTICLE I
DEFINITIONS
Section 1.1 Definitions. As used in this Agreement, the following terms
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shall have the following meanings:
"Affiliate," as applied to any specified Person, shall mean any other
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Person that, directly or indirectly, controls, is controlled by or is under
common control with such specified Person. For purposes of the foregoing,
"control," when used with respect to any Person, means the possession, directly
or indirectly, of the power to direct or cause the direction of the management
or policies of such Person, whether through the ownership of Voting Securities,
by contract or otherwise, and the terms "controlled" and "controlling" shall
have meanings correlative to the foregoing. In the case of a Person who is an
individual, the term "Affiliate" shall include, with respect to such specified
Person (i) members of such specified Person's immediate family (as defined in
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Instruction 2 of Item 404(a) of Regulation S-K under the Securities Act) and
(ii) trusts, the trustee or the beneficiaries of which are such specified Person
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or members of such Person's immediate family as determined in accordance with
the foregoing clause (i). Notwithstanding the foregoing, the Investors and their
respective Affiliates shall not be deemed Affiliates of the Company for purposes
of this Agreement.
"Audit" shall mean any audit, assessment of Taxes, other examination by
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any Tax Authority, proceeding or appeal of such proceeding relating to Taxes.
"Business Day" shall mean each day other than Saturdays, Sundays and days
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when commercial banks are required or authorized by law or executive order to be
closed for business in New York, New York.
"Charter Documents" means the certificate of incorporation, bylaws and any
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other organizational document, as amended or restated (or both) to date, of the
Company, or any of its Subsidiaries, as applicable.
"Closing" has the meaning ascribed thereto in Section 2.2(b).
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"Closing Date" has the meaning ascribed thereto in Section 2.2(b).
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"Code" means the Internal Revenue Code of 1986, as amended, or any similar
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Federal law then in force, and the rules and regulations promulgated thereunder,
all as the same may from time to time be in effect.
"Common Stock" has the meaning ascribed thereto in Section 2.1.
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"Consolidated" or "consolidated," when used with reference to any
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accounting term, means the amount described by such accounting term, determined
on a consolidated basis in accordance with GAAP, after elimination of
intercompany items.
"Contracts" has the meaning ascribed thereto in Section 4.7(a)(3).
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"Documents" means this Agreement, the Warrant Agreement and the
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Registration Rights Agreement, collectively, or each of such documents
singularly, and any documents or instruments contemplated by or executed in
connection with any of them or any of the transactions contemplated hereby or
thereby.
"Employee Benefit Plan" has the meaning ascribed thereto in Section 4.16.
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"Environmental Claim" means any claim, action, cause of action,
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investigation of which the Company or any of its Subsidiaries, including any of
their management employees, are aware, or written notice by any Person alleging
potential liability (including, without limitation, potential liability for
investigatory costs, cleanup costs, governmental response costs, natural
resources damages, property damages, personal injuries or penalties) arising out
of, based on or resulting from (a) the presence, or release into the
environment, of any Material of Environmental Concern at any location owned,
leased, used or operated by the Company or any of its Subsidiaries, or (b)
circumstances forming the basis of any violation, or alleged violation, of any
Environmental Law.
"Environmental Laws" means all Legal Requirements relating to pollution or
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protection of human health or the environment (including, without limitation,
ambient air, surface water, ground water, land surface or subsurface strata and
natural resources),
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including, without limitation, laws and regulations relating to emissions,
discharges, releases or threatened releases of Materials of Environmental
Concern, or otherwise relating to the manufacture, processing, distribution,
use, treatment, storage, disposal, transport or handling of Materials of
Environmental Concern.
"Equity Interest" means (i) with respect to a corporation, any and all
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issued and outstanding capital stock and warrants, options or other rights to
acquire capital stock and (ii) with respect to a partnership, limited liability
company or similar Person, any and all units, interests, or other equivalents
of, or other ownership interests in any such Person and warrants, options or
other rights to acquire any such units or interests.
"ERISA" means the Employee Retirement Income Security Act of 1974, as
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amended from time to time, and any successor statute or law thereto.
"ERISA Affiliate" has the meaning ascribed thereto in Section 4.16.
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"GAAP" means United States generally accepted accounting principles.
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"Governmental Body" shall mean any Federal, state, local or foreign
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governmental authority or regulatory body, any subdivision, agency, commission
or authority thereof or any quasi-governmental or private body exercising any
governmental regulatory authority thereunder and any Person directly or
indirectly owned by and subject to the control of any of the foregoing, or any
court, arbitrator or other judicial or quasi-judicial tribunal.
"Holder" or "Holders" means each Investor and any Affiliate or Related
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Person of any Investor that is or becomes a holder of any of the Securities, in
each case, so long as such Person holds any Securities.
"HSR Act" means the Xxxx-Xxxxx-Xxxxxx Antitrust Improvements Act of 1976,
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as amended, and the rules and regulations thereunder.
"Inspectors" has the meaning ascribed thereto in Section 6.2.
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"Intellectual Property Rights" means all industrial and intellectual
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property rights, including, without limitation, patents, patent applications,
patent rights, trademarks, trademark applications, trade names, service marks,
service xxxx applications, copyrights, copyright applications, know-how, trade
secrets, proprietary processes and formulae, confidential information,
franchises, licenses, inventions, instructions, marketing materials, trade
dress, logos and designs and all documentation and media constituting,
describing or relating to the foregoing, including manuals, memoranda and
records.
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"Investors" means the investors signatory to this Agreement.
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"IPO" has the meaning ascribed thereto in Section 2.2(a).
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"Xxxxx" means collectively Xxxxx Investment Associates V, L.P., a Delaware
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limited partnership, and Xxxxx Equity Partners V, L.P., a Delaware limited
partnership.
"Laws" has the meaning ascribed thereto in Section 4.7(a)(2).
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"Legal Requirements" means, as to any Person, all Federal, state, local or
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foreign laws, statutes, rules, regulations, ordinances, judgments, orders,
decrees, permits, certificates, requirements, regulations and restrictions of
any Governmental Body applicable to such Person or any of its properties or
assets.
"Liability" means any liability or obligation, whether known or unknown,
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asserted or unasserted, absolute or contingent, accrued or unaccrued, liquidated
or unliquidated and whether due or to become due, regardless of when asserted.
"Lien" means any mortgage, pledge, lien, encumbrance, charge or adverse
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claim affecting title or resulting in a charge against real or personal
property, or security interest of any kind (including, without limitation, any
conditional sale or other title retention agreement, any lease in the nature
thereof, any option or other agreement to sell and any filing of any financing
statement under the Uniform Commercial Code (or equivalent statutes) of any
jurisdiction).
"Material Adverse Effect" means (a) a material adverse effect upon the
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business, operations, prospects, properties, assets or condition (financial or
otherwise) of the Company and its Subsidiaries, taken as a whole, or (b) a
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material adverse effect on the ability of the Company to perform its obligations
under this Agreement or any of the other Documents.
"Materials of Environmental Concern" means chemicals, pollutants,
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contaminants, industrial, toxic or hazardous wastes, substances or constituents,
petroleum and petroleum products (or any by-product or constituent thereof),
asbestos or asbestos-containing materials or PCBs.
"Notices" has the meaning ascribed thereto in Section 7.1.
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"Permitted Lien" shall mean the following Liens: (a) Liens existing on
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the Closing Date as listed on Schedule 1.1; (b) Liens for taxes, assessments or
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other governmental charges or levies not yet due; (c) statutory Liens of
landlords, carriers,
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warehousemen, mechanics, materialmen and other Liens imposed by law created in
the ordinary course of business of the Company consistent with past practices
for amounts not yet due; (d) Liens (other than any Lien imposed by ERISA)
incurred or deposits made in the ordinary course of business of the Company
consistent with past practices in connection with worker's compensation,
unemployment insurance or other types of social security; and (e) with respect
to interests in real property, minor defects of title, easements, rights-of-way,
restrictions and other similar charges or Liens not materially detracting from
the value or materially interfering with the use of such real property.
"Person" means an individual, partnership, corporation, trust or
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unincorporated organization or a government or agency or political subdivision
thereof.
"Proceeding" means any legal, administrative or arbitration action, suit,
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complaint, charge, hearing, inquiry, investigation or proceeding (including any
partial or threatened proceedings).
"Registration Rights Agreement" has the meaning ascribed thereto in
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Section 2.1.
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"Registration Statement" means the Company's Registration Statement on
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Form S-1 and all amendments thereto, as filed with the SEC.
"Related Person" means, with respect to any Investor, (i) any officer,
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director or partner of, or Person controlling, such Investor or (ii) any other
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Person that is (x) an Affiliate of such Investor, (y) an Affiliate of the
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general partner(s), investment manager(s) or investment advisor(s) of such
Investor or (z) an investment fund, investment account or investment entity
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whose investment manager, investment advisor or general partner thereof is such
Investor or an Affiliate of such Investor.
"SEC" means the Securities and Exchange Commission and any successor
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thereto.
"Securities Act" means the Securities Act of 1933, as amended, and the
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rules and regulations of the SEC thereunder, and any successor statute or law
thereto.
"Security" or "Securities" has the meaning ascribed thereto in Section
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2.1.
"Shares" has the meaning ascribed thereto in Section 2.1.
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"Stockholders' Agreement" means the Second Amended and Restated
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Stockholders' Agreement, among the Company and the Investors named therein,
dated as of August 14, 1998.
"Subsidiary" of any person means (a) a corporation in which such Person, a
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subsidiary of such Person, or such Person and one or more subsidiaries of such
Person, directly or indirectly, at the date of determination, has either (i) a
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majority ownership
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interest or (ii) the power, under ordinary circumstances, to elect, or to
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direct the election of, a majority of the board of directors of such
corporation, or (b) a partnership in which such Person, a subsidiary of such
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Person, or such Person and one or more subsidiaries of such Person (i) is, at
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the date of determination, a general partner of such partnership, or (ii) has
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a majority ownership interest in such partnership or the right to elect, or to
direct the election of, a majority of the governing body of such partnership, or
(c) any other Person (other than a corporation or a partnership) in which such
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Person, a subsidiary of such Person, or such Person and one or more subsidiaries
of such Person has either (i) at least a majority ownership interest or (ii) the
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power to elect, or to direct the election of, a majority of the directors or
other governing body of such Person.
"Tax" means any Taxes and the term "Taxes" means, with respect to any
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Person, (A) all income taxes (including any tax on or based upon net income, or
gross income, or income as specially defined, or earnings, or profits, or
selected items of income, earnings or profits) and all gross receipts, sales,
use, ad valorem, transfer, franchise, license, withholding, payroll, employment,
excise, severance, stamp, occupation, premium, property or windfall profits
taxes, alternative or add-on minimum taxes, customs duties or other taxes, fees,
assessments or charges of any kind whatsoever, together with any interest and
any penalties, additions to tax or additional amounts imposed by any taxing
authority (domestic or foreign) on such Person and (B) any Liability for the
payment of any amount of the type described in the immediately preceding clause
(A) as a result of being a "transferee" (within the meaning of Section 6901 of
the Code or any other Law) of another Person or a member of an affiliated or
combined group.
"Tax Authority" means the Internal Revenue Service and any other domestic
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or foreign governmental authority responsible for the administration of any
Taxes.
"Tax Returns" shall mean all Federal, state, local and foreign tax
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returns, declarations, statements, reports, schedules, forms and information
returns and any amended Tax Return relating to Taxes.
"Transactions" has the meaning ascribed thereto in Section 4.4.
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"Transfer" means any direct or indirect sale, assignment, mortgage,
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transfer, pledge, hypothecation or other disposition or transfer.
"Voting Securities" means any class of equity interests of a Person
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pursuant to which the holders thereof have, at the time of determination, the
general power under ordinary circumstances to vote for the election of
directors, managers, trustees or general partners of such Person (irrespective
of whether or not at the time any other class or classes will have or might have
the general power under ordinary circumstances to vote
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for the election of directors, managers, trustees or general partners by reason
of the happening of any contingency).
"Warrant Agreement" means the Warrant Agreement between the Company and
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the Investors, to be entered into at the Closing pursuant to this Agreement,
substantially in the form of Exhibit A hereto.
"Warrants" has the meaning ascribed thereto in Section 2.1.
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"Warrant Shares" has the meaning ascribed thereto in Section 2.1.
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Section 1.2 Rules of Construction. Unless the context otherwise
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requires:
(a) a term has the meaning assigned to it;
(b) "or" is not exclusive;
(c) words in the singular include the plural, and words in the plural
include the singular;
(d) provisions apply to successive events and transactions; and
(e) "herein," "hereof," "hereunder" and other words of similar import
refer to this Agreement as a whole and not to any particular section or other
subdivision.
ARTICLE II
PURCHASE AND SALE OF SECURITIES
Section 2.1 Issue and Sale of Securities. The Company has authorized
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the issuance and sale to the Investors, in the respective amounts set forth
below such Investor's name on the signature page hereto, of (i) an aggregate of
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2,000,000 shares of the Company's common stock, par value $.01 (the "Common
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Stock"), to be issued to the Investors and (ii) warrants (the "Warrants") to
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purchase an aggregate of 1,500,000 shares of Common Stock, subject to adjustment
as set forth in the Warrant Agreement. The shares of Common Stock issued on the
Closing Date pursuant to this Agreement (the "Shares") and the Warrants are
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referred to herein as a "Security" and collectively as the "Securities" and the
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shares of Common Stock issuable upon exercise of the Warrants are referred to
herein as the "Warrant Shares." Each Holder of Securities will have certain
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registration rights with respect to the Shares and the Warrant Shares as set
forth in the
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Registration Rights Agreement, dated as of April 30, 1996, by and among the
Company and certain stockholders of the Company (the "Registration Rights
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Agreement").
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Each Warrant shall be substantially in the form attached as Exhibit A to
the Warrant Agreement. Each Warrant shall be dated the date of its issuance.
The Warrants will be exercisable in the manner provided in the Warrant Agreement
for a number of Warrant Shares as provided in the Warrant Agreement. The terms
and provisions contained in the Warrant Agreement and in the Warrants shall
constitute, and are hereby expressly made, a part of this Agreement and, to the
extent applicable, the Company and the Holders, by their execution and delivery
of this Agreement, expressly agree to such terms and provisions and to be bound
thereby.
Section 2.2 Purchase and Sale of Securities. (a) Purchase and Sale.
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Subject to the terms and conditions set forth herein and in reliance on the
respective representations and warranties of the Company, on the one hand, and
the Investors, on the other hand, contained herein, the Company agrees to sell
to each Investor, and each of the Investors agrees, severally but not jointly,
to purchase from the Company (i) the shares of Common Stock indicated on Annex 1
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attached hereto for an aggregate purchase price equal to the product of (A) the
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"per share price to public" specified for the shares of Common Stock in the
final prospectus for the Company's initial public offering of Common Stock
contemplated by the Registration Statement (the "IPO") times (B) the aggregate
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number of Shares being purchased by such Investor as indicated on Annex 1 and
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(ii) the Warrants for the consideration reflected in the Warrant Agreement.
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(b) Closing. The purchase and sale of the Securities shall take place at
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a closing (the "Closing") at the offices of Debevoise & Xxxxxxxx, 875 Third
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Avenue, New York, New York, 10022, on the later of (i) the date of the closing
of the IPO and (ii) the second Business Day after the termination of the waiting
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period applicable to the Transactions under the HSR Act (the "Closing Date").
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At the Closing, the Company will deliver to each of the Investors the Securities
to be purchased by such Investor (registered in such Investor's name or the name
of such nominee or nominees as such Investor may request), dated the Closing
Date, against payment of the purchase price therefor by intra-bank or Federal
funds bank wire transfer of same day funds to such bank account within the
United States as the Company shall designate at least two Business Days prior to
the Closing.
(c) Fees and Expenses. Provided that the Closing occurs, the Company
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agrees to pay or reimburse all expenses relating to this Agreement, including
but not limited to:
(1) each Investor's expenses incurred in connection with the transactions
contemplated by this Agreement and the other Documents, including, without
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limitation, costs incurred in connection with such Investor's review of the
Company's business and operations, including the reasonable fees and other
charges and expenses of the Investor's counsel incurred in connection
herewith or with the other Documents;
(2) any reasonable fees and other charges and expenses (including the
reasonable fees and other charges and expenses of counsel) incurred in
connection with any registration or qualification of the Securities required
in connection with the offer and sale of the Securities pursuant to this
Agreement under the securities or "blue sky" laws of any jurisdiction
requiring such registration or qualification or in connection with obtaining
any exemptions from such requirements; and
(3) each Investor's or Holder's expenses (including the reasonable fees
and other charges and expenses of their counsel) relating to any amendment
to, or modification of, or any waiver or consent or preservation of rights
under, this Agreement, the Securities or any of the other Documents.
Reimbursement of the expenses to which such Investor is entitled pursuant
to this Section 2.2(c), including, without limitation, the reasonable fees and
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other charges and expenses of such Investor's counsel, shall be made
concurrently with the Closing by intra-bank or Federal funds bank wire transfer
of same day funds, or at such other time and in such other manner as the Company
and the Investors may agree.
(d) Other Investors. The obligations of each Investor shall be several
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and not joint, and no Investor shall be liable or responsible for the acts of
any other Investor under this Agreement.
Section 2.3 Issue Taxes. The Company agrees to pay all Taxes (other
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than Taxes in the nature of income, franchise or gift taxes) and governmental
fees arising in connection with the issuance, sale, delivery or transfer by the
Company to each Holder of the Shares, the Warrants and the Warrant Shares, as
the case may be, and the execution and delivery of the other Documents and any
modification of any of such Securities and Documents and will hold such Holder
harmless without limitation as to time against any and all liabilities with
respect to all such Taxes and fees.
ARTICLE III
CLOSING CONDITIONS
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Section 3.1 Conditions to Obligations of the Investors. The obligations
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of each Investor to purchase and pay for the Securities to be delivered to such
Investor at the Closing shall be subject to the satisfaction (or waiver by the
Investors) of each of the following conditions on or before the Closing Date:
(a) Delivery of Documents. The Company shall have delivered to each
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Investor, in form and substance satisfactory to such Investor, the following:
(i) The Shares and Warrants being purchased by such Investor, duly
executed by the Company, in the aggregate number set forth below such
Investor's name on the signature pages hereto.
(ii) An opinion, dated the Closing Date and addressed to each Investor,
from Xxxxxx & Xxxxxx, a professional corporation, counsel for the Company, as
to the matters set forth in Exhibit B attached hereto.
(iii) Copies of the certificate of incorporation of the Company, together
with good standing certificates from the state of its incorporation, from the
state in which its principal place of business is located, and from all
states in which the laws thereof require the Company to be qualified and/or
licensed to do business, except where the failure to be so qualified would
not result in a Material Adverse Effect, each to be dated a recent date prior
to the Closing Date and certified by the applicable Secretary of State or
other authorized governmental entity.
(iv) a certificate of the Secretary of the Company, dated the Closing
Date, certifying (A) a copy of the bylaws of the Company, (B) resolutions of
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the Board of Directors of the Company, authorizing the execution, delivery
and performance of this Agreement, the Warrant Agreement and the other
Documents to which the Company is a party and the consummation of the
transactions contemplated hereby and thereby, including the issuance of the
Shares and Warrants pursuant to this Agreement, and (C) as to the incumbency
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and genuineness of the signatures of the officers of the Company.
(v) A certificate of an officer of the Company, dated the Closing Date,
certifying as to the satisfaction of conditions specified in Sections 3.1(b)
and 3.1(d).
(vi) Such additional information and materials as any Investor may
reasonably request.
(b) Compliance with Agreements. The Company shall have performed and
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complied in all material respects with all agreements, covenants and conditions
contained
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herein, in each of the other Documents and in any other document contemplated
hereby or thereby which are required to be performed or complied with by the
Company on or before the Closing Date.
(c) Completion of Other Transactions. Simultaneously with or prior to
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the sale to each Investor of the Securities to be purchased by such Investor:
(i) The Company shall have executed and delivered the Warrant Agreement.
(ii) The Company shall have executed and delivered an Agreement to be
Bound to the Registration Rights Agreement of the Company, dated as of the
Closing Date, in the form of Exhibit C attached hereto, with respect to each
Investor other than General Electric Capital Corporation ("GECC").
(iii) The IPO shall have been consummated.
(iv) All the other Investors listed in the signature pages hereof shall
have consummated their purchase of securities pursuant to this Agreement.
(v) The Company shall have executed and delivered the necessary
documentation, reasonably satisfactory to the parties hereto, to make the
Investors parties to the Stockholders' Agreement.
(d) Representations and Warranties. All of the representations and
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warranties of the Company contained herein or in any of the other Documents
shall be true and correct in all material respects on and as of the Closing
Date, except those representations and warranties of the Company that speak as
of a certain date, which representations and warranties shall have been true and
correct in all material respects as of such date, both before and after giving
effect to the transactions contemplated hereby and by the other Documents.
(e) Proceedings Satisfactory. All proceedings taken in connection with
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the sale of the Securities, the transactions contemplated hereby, and all
documents and papers relating thereto, shall be reasonably satisfactory to such
Investor. Such Investor and its counsel shall have received copies of such
documents and papers as they may reasonably request in connection therewith, or
as a basis for the opinions to be delivered pursuant to Section 3.1(a)(ii), all
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in form and substance satisfactory to such Investor.
(f) Consents and Permits. The Company shall have received all consents,
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permits, approvals and authorizations and sent or made all notices, filings,
registrations and qualifications as may be required pursuant to any law,
statute, regulation or rule (Federal, state, local or foreign) or pursuant to
any other agreement, order or decree to which any of them is a party or to which
any of them is subject, in connection with the transactions to be consummated on
or prior to the Closing Date as contemplated by this Agreement or any of the
other Documents.
(g) No Material Adverse Change. There shall not have been any material
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adverse change in the properties, business, operations, assets, prospects,
condition
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(financial or otherwise) of the Company and its Subsidiaries taken as a whole
since December 31, 1998.
(h) No Material Judgment or Order. There shall not be on the Closing
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Date any judgment or order of a court of competent jurisdiction or any ruling of
any Federal, state or local Governmental Body that, in the reasonable judgment
of any Investor or its counsel, would prohibit the sale or issuance of the
Securities hereunder or subject the Company or any Investor to any material
penalty or liability if the Securities were to be issued and sold hereunder or
the other Transactions are consummated.
(i) HSR Act. The waiting period under the HSR Act applicable to the
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Transactions shall have been terminated.
(j) No Material Proceedings. No Proceeding shall have been pending or
-----------------------
threatened as of the Closing Date to restrain, prohibit or otherwise challenge
the Transactions, nor shall any Governmental Body have notified any party to
this Agreement that the consummation of the Transactions hereby would constitute
a violation of the laws of the United States or the laws of any State thereof or
the laws of the jurisdiction to which such Governmental Body is subject and that
it intends to commence proceedings to restrain the consummation of such
transactions, to force divestiture if the same are consummated or to materially
modify the terms or results of such Transactions unless such Governmental Body
shall have withdrawn such notice, or has otherwise indicated in writing that it
will not take any action.
Section 3.2 Conditions to Obligations of the Company. The obligations
----------------------------------------
of the Company to sell and issue the Securities to be delivered to each Investor
at the Closing shall be subject to the satisfaction (or waiver by the Company)
of each of the following conditions on or before the Closing Date:
(a) Completion of Other Transactions. Simultaneously with or prior to
--------------------------------
the sale to each Investor of the Securities to be purchased by such Investor:
(i) All of the other Investors listed in the signature pages hereof shall
have consummated their purchase of Securities pursuant to this Agreement.
(ii) The IPO shall have been consummated.
(iii) Each Investor (other than GECC) shall have executed and delivered an
Agreement to be Bound to the Registration Rights Agreement of the Company in
the form of Exhibit C attached hereto.
(iv) Each Investor shall have executed and delivered necessary
documentation reasonably satisfactory to the parties hereto, to become a
party to the Stockholders' Agreement.
12
(b) Representations and Warranties. All of the representations and
------------------------------
warranties of the Investors contained herein or in any of the other Documents
shall be true and correct in all material respects on and as of the Closing
Date, except for those representations and warranties of the Investors that
speak as of a certain date, which representations and warranties shall have been
true and correct in all material respects as of such date, both before and after
giving effect to the transactions contemplated hereby and by the other
Documents.
(c) Compliance with Agreements. Each Investor shall have performed and
--------------------------
complied in all material respects with all agreements, covenants and conditions
contained herein, in each of the other Documents to which it is a party and in
any other document contemplated hereby or thereby which are required to be
performed or complied with by such Investor on or before the Closing Date.
(d) No Material Judgment or Order. There shall not be any judgment or
-----------------------------
order of a court of competent jurisdiction or any ruling of any Federal, state
or local Governmental Body that prohibits the sale or issuance of the Securities
to the Investors or that would subject the Company to any material penalty or
liability if the Securities were to be issued and sold hereunder or the other
Transactions are consummated.
(e) HSR Act. The waiting period under the HSR Act applicable to the
-------
Transactions shall have been terminated.
(f) Material Proceedings. No Proceeding shall have been pending or
--------------------
threatened as of the Closing Date to restrain, prohibit or otherwise challenge
the Transactions, nor shall any Governmental Body have notified any party to
this Agreement that the consummation of the Transactions hereby would constitute
a violation of the laws of the United States or the laws of any State thereof or
the laws of the jurisdiction to which such Governmental Body is subject and that
it intends to commence proceedings to restrain the consummation of such
transactions, to force divestiture if the same are consummated or to materially
modify the terms or results of such Transactions unless such Governmental Body
shall have withdrawn such notice, or has otherwise indicated in writing that it
will not take any action.
ARTICLE IV
REPRESENTATIONS AND WARRANTIES OF THE COMPANY
The Company represents and warrants to the Investors on the date hereof
and as of the Closing as follows:
13
Section 4.1 Due Incorporation and Good Standing. The Company has been
-----------------------------------
duly incorporated and is validly existing as a corporation in good standing
under the laws of the State of Delaware with corporate power and authority to
own, lease and operate its properties, to conduct its business as currently
conducted and as proposed to be conducted and to enter into and perform its
obligations under this Agreement and the other Documents to which it is a party.
The Company is duly qualified as a foreign corporation to transact business and
is in good standing in each jurisdiction in which such qualification is
required.
Section 4.2 Capitalization. (a) The capitalization of the Company as
--------------
of December 31, 1998 is as described on Schedule 4.2. As of the Closing Date,
------------
after giving effect to the Transactions and immediately after the closing of the
IPO, the capitalization of the Company will be as described as "pro forma as
adjusted" on Schedule 4.2. Except as described as "pro forma as adjusted" on
-------------
Schedule 4.2, as of the Closing and after giving effect to the Transactions, no
------------
Equity Interests of the Company will be issued or outstanding and there will be
no options, agreements, instruments or securities relating to the issued or
unissued Equity Interests of the Company or any Subsidiary of the Company, or
obligating the Company or any Subsidiary of the Company to issue, transfer,
grant or sell any Equity Interests in the Company or any Subsidiary.
(b) The Company has complied in all material respects with all federal and
state securities laws in connection with the issuance of all outstanding Equity
Interests.
(c) Except as listed on Schedule 4.2, and except as contemplated by the
------------
Documents, there are no preemptive rights, voting agreements, transfer
restrictions (except those imposed by applicable federal and state securities
laws) or registration rights (except as set forth in the Registration Rights
Agreement) affecting the Equity Interests in the Company.
Section 4.3 Subsidiaries. Schedule 4.3 hereto sets forth a list of all
------------ ------------
Subsidiaries of the Company and the respective state or jurisdiction of
incorporation or organization. Except as set forth on Schedule 4.3, all of the
------------
issued or outstanding Equity Interests of such Subsidiaries have been duly and
validly issued and are fully paid and nonassessable and are owned, directly or
indirectly, by the Company. Each Subsidiary of the Company is duly incorporated
and is in good standing in its respective state or jurisdiction of incorporation
and has the corporate authority to own, lease or operate its properties and to
conduct its business as currently conducted and as proposed to be conducted.
Each Subsidiary of the Company is duly qualified to transact business and is in
good standing as a foreign corporation in each state or jurisdiction in which
such qualification is required, except where the failure to be so qualified
would not reasonably be expected to have a Material Adverse Effect.
14
Section 4.4 Authority. The Company has all necessary corporate power
---------
and authority to execute and deliver this Agreement and each of the other
Documents to which it is a party, and to perform its obligations hereunder and
thereunder, and to consummate the transactions contemplated hereby and thereby
(the "Transactions"). The execution and delivery of this Agreement and the
------------
other Documents to which it is a party have been authorized by all necessary
corporate action on the part of the Company and no other corporate proceedings
or approvals are required on the part of the Company to authorize this Agreement
or the other Documents to which it is a party or to consummate the Transactions.
This Agreement has been duly and validly executed and delivered by the Company
and, assuming the due authorization, execution and delivery thereof by the
Investors, constitutes the legal, valid and binding obligation of the Company,
enforceable against the Company in accordance with its terms, except as such
enforcement may be limited by bankruptcy, insolvency, reorganization, moratorium
or other similar laws now or hereafter in effect relating to or affecting
creditors' rights generally and by general principles of equity (regardless of
whether such enforceability is considered in a proceeding in equity or at law).
Section 4.5 Authorization, Etc. of Shares. The issuance and sale of the
-----------------------------
Shares have been duly authorized by all necessary corporate action on the part
of the Company and the Shares, when issued to the Investors for the
consideration set forth herein, will be duly authorized, validly issued and
fully paid and non-assessable, free of preemptive rights with no personal
liability attached to the ownership thereof.
Section 4.6 Authorization, Etc. of Warrant Agreement and Warrant Shares.
-----------------------------------------------------------
The Warrant Agreement has been duly authorized by all necessary corporate action
on the part of the Company and, at the Closing, will be validly executed and
delivered by the Company and, assuming the due authorization, execution and
delivery thereof by the Investors, will constitute a legal, valid and binding
agreement of the Company, enforceable against the Company in accordance with its
terms, except as such enforcement may be limited by bankruptcy, insolvency,
reorganization, moratorium or other similar laws now or hereafter in effect
relating to or affecting creditors' rights generally and by general principles
of equity (regardless of whether such enforceability is considered in a
proceeding in equity or at law). The Company has duly authorized and reserved a
sufficient number of shares of Common Stock for issuance upon exercise of the
Warrants and the Warrant Shares, when issued upon exercise of the Warrants in
accordance with the terms of the Warrant Agreement and the Warrants, will be
duly authorized, validly issued and fully paid and nonassessable, free of
preemptive rights with no personal liability attached to the ownership thereof.
Section 4.7 No Violation or Conflict; No Default. (a) Neither the
------------------------------------
execution, delivery or performance of this Agreement or any of the other
Documents by the
15
Company, nor the compliance with its obligations hereunder or thereunder, nor
the consummation of the transactions contemplated hereby and thereby, nor the
issuance, sale or delivery of the Securities will:
(1) violate or conflict with any provision of the Charter Documents of
the Company or any of its Subsidiaries;
(2) violate or conflict with any statute, law, rule or regulation or any
judgment, decree, order, regulation or rule of any court or governmental
authority or body (collectively, "Laws") applicable to the Company or any of
----
its Subsidiaries or by which any of their respective properties or assets may
be subject; or
(3) violate, be in conflict with, or constitute a breach or default (or
any event which, with the passage of time or notice or both, would become a
default) under, or permit the termination of, or require the consent of any
Person under, result in the creation or imposition of any Lien upon any
property of the Company or its Subsidiaries under, result in the loss (by the
Company or any Subsidiary) or modification in any manner adverse to the
Company and its Subsidiaries of any right or benefit under, or give to any
other Person any right of termination, amendment, acceleration, repurchase or
repayment, increased payments or cancellation under, any mortgage, indenture,
note, debenture, agreement, lease, license, permit, franchise or other
instrument or obligation, whether written or oral (collectively, "Contracts")
---------
to which the Company or any of its Subsidiaries is a party or by which their
properties may be bound or affected, except as would not, individually or in
the aggregate, reasonably be expected to have a Material Adverse Effect.
(b) The execution and delivery of this Agreement and the other Documents
to which the Company is a party do not, and the performance of its obligations
under this Agreement and the other Documents and the consummation of the
Transactions will not, require any consent, approval, authorization or permit
of, or filing with or notification to, any Governmental Body under any Laws,
except for (i) notification pursuant to, and expiration or termination of the
-
waiting period under, the HSR Act and (ii) required filings under the Securities
--
Act or state "blue sky" laws.
Section 4.8 No Material Adverse Change; Financial Statements. (a)
------------------------------------------------
Except as set forth on Schedule 4.8 hereto, subsequent to December 31, 1998,
------------
there has not been (i) any material adverse change in the properties, business,
prospects, operations, assets or condition (financial or otherwise) of the
Company and its Subsidiaries taken as a whole, (ii) any asset or property of the
Company made subject to a Lien of any kind, other than a Permitted Lien, (iii)
any waiver of any valuable right of the Company or any Subsidiary, or the
cancellation of any material debt or material claim held by the Company or any
16
Subsidiary, (iv) any payment of dividends on, or other distributions with
respect to, or any direct or indirect redemption or acquisition of, any shares
of the capital stock of the Company, or any agreement or commitment therefor,
(v) any mortgage, pledge, sale, assignment or transfer of any material tangible
or intangible assets of the Company, except in the ordinary course of business,
(vi) any loan by the Company or any Subsidiary to any officer, director,
employee, consultant or direct or indirect stockholder or any agreement or
commitment therefor in excess of $100,000, other than travel expense advances
made by the Company to its officers, directors, employees, consultants or
stockholders in the ordinary course of business, (vii) any material damage,
destruction or loss (whether or not covered by insurance) affecting the assets
of the Company or any Subsidiary or (viii) any increase, direct or indirect, in
the compensation paid or payable to any officer, director, employee or
consultant of the Company or any Subsidiary other than in the ordinary course of
business.
(b) The Company has heretofore furnished the Purchasers with a true and
complete copy of (i) the audited financial statements of iXL Interactive
Excellence, Inc. (n/k/a iXL, Inc.) as of and for the years ended December 31,
1993, 1994 and 1995, and as of and for the four-month period ended April 30,
1996; (ii) audited combined financial statements for Creative Video, Inc. (n/k/a
iXL, Inc.), Creative Video Library, Inc. and Entrepreneur Television, Inc. as of
and for the years ending December 31, 1993, 1994 and 1995, and as of and for the
four-month period ended April 30, 1996; (iii) the audited consolidated financial
statements for the Company and its Subsidiaries as of and for the eight months
ended December 31, 1996; (iv) the audited consolidated financial statements for
the Company and its Subsidiaries as of and for the year ending December 31,
1997; and (v) the audited consolidated financial statements for the Company and
its Subsidiaries as of and for the year ending December 31, 1998. Such
financial statements present fairly in all material respects the consolidated
financial position, results of operations, cash flows, and shareholders' equity
of the Company at the respective dates or for the respective periods to which
they apply. Except as disclosed therein, such statements and related notes have
been prepared each in accordance with GAAP consistently applied throughout the
periods involved. Except as set forth on Schedule 4.8, since December 31, 1998,
------------
neither the Company nor any of its Subsidiaries has incurred any liabilities or
obligations (whether absolute, accrued, fixed, contingent, liquidated,
unliquidated or otherwise and whether due or to become due) of any nature,
except for liabilities, obligations or contingencies (a) which are reflected in
the audited balance sheet of the Company at December 31, 1998, (b) which were
incurred in the ordinary course of business after December 31, 1998 and
consistent with past practices, (c) which would not, individually or in the
aggregate, reasonably be expected to have a Material Adverse Effect or (d) which
arise as a result of this Agreement or the other Documents. Since December 31,
1998, there has been no change in any significant accounting (including tax
accounting) policies, practices or procedures of the Company or its
Subsidiaries. All
17
financial statements concerning the Company and its Subsidiaries that will
hereafter be furnished by the Company and its Subsidiaries to the Investors or
any Holder pursuant to this Agreement will be prepared in accordance with GAAP
consistently applied (except as disclosed therein) (except for, in the case of
the unaudited financial statements, the exclusion of footnotes and normal year
end adjustments) and will present fairly in all material respects the financial
condition of the entities covered thereby as at the dates thereof and the
results of their operations for the periods then ended.
(c) Except as set forth on Schedule 4.8, the Company has good and
marketable title to all properties, interests in properties and assets, real,
personal and mixed, tangible or intangible, used in the conduct of its business,
free and clear of all Liens other than Permitted Liens.
Section 4.9 Full Disclosure. Neither this Agreement, the financial
---------------
statements referred to in Section 4.8 nor any Document contains any untrue
-----------
statement of a material fact or omits or will omit to state a material fact
necessary to make the statements contained herein or therein not misleading in
light of the circumstances under which they were made.
Section 4.10 Private Offering. Assuming the correctness of the
----------------
representations and warranties set forth in Sections 5.2 and 5.3, and the
--------------------
compliance by the Investors with Section 6.7 hereof, the offer and sale of the
-----------
Securities to the Investors hereunder is exempt from the registration and
prospectus delivery requirements of the Securities Act.
Section 4.11 No Brokers. Except as may be set forth on Schedule 4.11,
---------- -------------
the Company has not engaged any broker, finder, commission agent or other such
intermediary in connection with the sale of the Securities and the transactions
contemplated by this Agreement and the other Documents, and the Company is under
no obligation to pay any broker's or finder's fee or commission or similar
payment in connection with such transactions.
Section 4.12 Litigation. (a) Except as set forth on Schedule 4.12,
---------- -------------
there is no Proceeding, whether commenced, or to the knowledge of the Company,
threatened against or affecting the Company or any of its Subsidiaries or any of
their respective properties or assets, except for such Proceedings that would
not reasonably be expected to have, singly or in the aggregate, a Material
Adverse Effect, and there is no Proceeding seeking to restrain, enjoin, prevent
the consummation of or otherwise challenge this Agreement or any of the other
Documents or the Transactions.
(b) Neither the Company nor any of its Subsidiaries is subject to (i) any
judgment, order or decree of any Governmental Body or (ii) any rule or
regulation of any
18
Governmental Body that has had a Material Adverse Effect or that would
reasonably be expected to have, individually or in the aggregate, a Material
Adverse Effect.
Section 4.13 Labor Relations. (a) Neither the Company nor any of its
---------------
Subsidiaries, nor any Person for whom the Company or any of its Subsidiaries is
or may be responsible by law or contract, is engaged in any unfair labor
practice that would reasonably be expected to have, singly or in the aggregate,
a Material Adverse Effect. There is (i) no unfair labor practice charge or
complaint pending or, to the knowledge of the Company, threatened against the
Company or any of its Subsidiaries, or any Person for whom the Company or any of
its Subsidiaries is or may be responsible by law or contract, before the
National Labor Relations Board or any corresponding state, local or foreign
agency, and no grievance or arbitration proceeding arising out of or under any
collective bargaining agreement is so pending or threatened, (ii) no strike,
labor dispute, slowdown or stoppage pending or threatened against the Company or
any of its Subsidiaries, or any Person for whom either the Company or any of its
Subsidiaries is or may be responsible by law or contract, and (iii) no union
representation claim or question existing with respect to the employees of the
Company or any of its Subsidiaries, or any Person for whom either the Company or
any of its Subsidiaries is or may be responsible by law or contract, and no
union organizing activity taking place. Neither the Company nor any of its
Subsidiaries, nor any Person for whom the Company or any of its Subsidiaries is
or may be responsible by law or contract, is a party to any collective
bargaining agreement.
(b) Except as disclosed on Schedule 4.13 or such as would not reasonably
-------------
be expected to result in a Material Adverse Effect, neither the Company nor any
of its Subsidiaries has violated any Laws relating to employment or employment
practices or the terms and conditions of employment, including, without
limitation, discrimination in the hiring, promotion or pay of employees, wages,
hours of work, plant closings and layoffs, collective bargaining, immigration
and occupational safety and health. Except as disclosed on Schedule 4.13, to
-------------
the knowledge of the Company or any of its Subsidiaries, no charges with respect
to or relating to the Company or any of its Subsidiaries are pending before the
Equal Employment Opportunity Commission or any other corresponding state agency,
and the Company and each of its Subsidiaries have at all times been in material
compliance with all Legal Requirements prohibiting discrimination in the
workplace including, without limitation, Legal Requirements that prohibit
discrimination and/or harassment on account of race, national origin, religion,
gender, disability, age, immigration status, workers compensation status or
otherwise.
Section 4.14 Taxes. Except as otherwise disclosed in Schedule 4.14:
----- -------------
(a) The Company and its Subsidiaries have timely filed or will timely
file or cause to be timely filed, all Tax Returns (or extensions) required by
any Laws to be
19
filed by any of them prior to or as of the Closing Date (other than non-
material sales tax returns). All such Tax Returns and amendments thereto are
or will be true, complete and correct in all material respects.
(b) The Company and its Subsidiaries have paid, or where payment is not
yet due, have established, or will establish or cause to be established on or
before the Closing Date, an adequate accrual for the payment of, all Taxes
due with respect to any period ending prior to or as of the Closing Date.
(c) No Audit by a Tax Authority is pending or threatened with respect to
any Tax Returns filed by, or Taxes due from, the Company or its Subsidiaries.
No issue has been raised by any Tax Authority in any Audit of the Company or
its Subsidiaries that if raised with respect to any other period not so
audited would reasonably be expected to result in a material proposed
deficiency for any period not so audited. No deficiency or adjustment for
any Taxes has been threatened, proposed, asserted or assessed against the
Company or its Subsidiaries. There are no liens for Taxes upon the assets of
the Company or its Subsidiaries, except liens for current Taxes not yet due.
(d) Neither Company nor its Subsidiaries have given or been requested to
give any waiver of statutes of limitations relating to the payment of Taxes
or has executed powers of attorney with respect to Tax matters, which will be
outstanding as of the Closing Date.
(e) Neither the Company nor its Subsidiaries are a party to, or are bound
by any tax sharing, cost sharing or similar agreement or policy relating to
Taxes.
(f) Neither the Company nor its Subsidiaries have entered into agreements
that would result in the disallowance of any tax deductions pursuant to
Section 280G of the Code. No "consent" within the meaning of Section 341(f)
------------ --------------
of the Code has been filed with respect to the Company or its Subsidiaries.
Section 4.15 Environmental Matters. (a) Each of the Company and its
---------------------
Subsidiaries is in compliance with all Environmental Laws, except where such
non-compliance would not reasonably be expected to have a Material Adverse
Effect, and neither the Company nor any of its Subsidiaries has received any
written communication that alleges that the Company or its Subsidiaries is not
in compliance with any Environmental Laws, and there are no circumstances that
may prevent or interfere with such compliance in the future.
20
(b) There is no Environmental Claim pending or to the knowledge of the
Company threatened against the Company or any of its Subsidiaries with respect
to the operations or business of the Company or its Subsidiaries, or against any
person or entity whose liability for any Environmental Claim the Company or its
Subsidiaries has retained or assumed either contractually or by operation of
law.
(c) To the Company's knowledge, there are no past or present actions,
activities, circumstances, conditions, events or incidents, including, without
limitation, the release, emission, discharge, presence or disposal of any
Material of Environmental Concern, that could form the basis of any
Environmental Claim against the Company or its Subsidiaries, or against any
person or entity whose liability for any Environmental Claim the Company or its
Subsidiaries has retained or assumed either contractually or by operation of
law, which would reasonably be expected, individually or in the aggregate, to
have a Material Adverse Effect.
(d) Without in any way limiting the generality of the foregoing, Schedule
--------
4.15(d) sets forth (i) all permits, licenses and other governmental
-------
authorizations held by the Company and its Subsidiaries, or required for any of
their operations or business, under any Environmental Law, including the current
status of each such permit, license and authorization, (ii) all on-site and to
the knowledge of the Company off-site locations where the Company or any of its
Subsidiaries has stored, disposed or arranged for the disposal of Materials of
Environmental Concern, (iii) to the knowledge of the Company, all underground
storage tanks, and the capacity and contents of such tanks, located on property
owned, leased or controlled by the Company or its Subsidiaries, (iv) to the
knowledge of the Company, the location and condition of any asbestos or lead
(including furnishings or lead-based paints) contained in or forming part of any
building, building component, structure or office space owned, leased or
controlled by the Company or its Subsidiaries, and (v) to the knowledge of the
Company, all PCBs or PCB-containing items that are used or stored at any
property owned, leased or controlled by the Company or its Subsidiaries.
Section 4.16 ERISA. (a) Except as set forth on Schedule 4.16, neither
----- -------------
the Company nor its Subsidiaries, or any other trade or business, whether or not
incorporated that together with the Company or its Subsidiaries would be deemed
a "single employer" (within the meaning of Section 4001 of ERISA (an "ERISA
-----
Affiliate") is a "party in interest" (as defined in Section 3(14) of ERISA) or a
---------
"disqualified person" (within the meaning of Section 4975 of the Code), with
respect to any profit-sharing, pension or retirement plan, program, arrangement
or agreement, or any other "employee benefit plan" (within the meaning of
Section 3(3) of ERISA) or any "plan" (within the meaning of Section 4975 of the
Code) (collectively, each such plan, program, arrangement or agreement an
"Employee Benefit Plan").
----------------------
21
(b) With respect to each Employee Benefit Plan: (i) each Employee Benefit
Plan has been administered in compliance in all material respects with its
terms, including, but not limited to, any provisions relating to contributions
thereunder, and is in compliance in all material respects with the applicable
provisions of ERISA, the Code and all other Laws as they relate to such Employee
Benefit Plans; (ii) no "employee pension benefit plan" (as defined in Section
3(2) of ERISA) has been the subject of a "reportable event" (as defined in
Section 4043 of ERISA) and there have been no "prohibited transactions" (as
described in Section 4975 of the Code or Title I of ERISA) effected by the
Company or its Subsidiaries with respect to any Employee Benefit Plan and, to
the knowledge of the Company and its Subsidiaries, there have been no
"prohibited transactions" (as described in Section 4975 of the Code or Title I
of ERISA) effected by any Person other than the Company or its Subsidiaries with
respect to any Employee Benefit Plan; (iii) there are no proceedings, suits or
material claims (other than routine claims for benefits) pending or to the
knowledge of the Company or its Subsidiaries threatened with respect to any
Employee Benefit Plan, the assets of any trust thereunder or the Employee
Benefit Plan sponsor with respect to the design or operation of any Employee
Benefit Plan; (iv) no condition exists or event or transaction has occurred in
connection with any Employee Benefit Plan that has resulted or is reasonably
likely to result in the Company or its Subsidiaries or any such ERISA Affiliate
incurring any liability, fine or penalty except as would not reasonably be
expected to have, individually or in the aggregate, a Material Adverse Effect;
(v) no Employee Benefit Plan is or ever has been subject to Title IV of ERISA
and neither the Company nor its Subsidiaries has any liability under Title IV of
ERISA, whether actual or contingent; and (vi) no amounts payable pursuant to any
Employee Benefit Plan will, in connection with the Transactions, fail for any
reason to be deductible for Federal income tax purposes.
Section 4.17 Intellectual Property Rights. Each of the Company and its
----------------------------
Subsidiaries owns or possesses adequate licenses or other rights to use all
Intellectual Property Rights material to its business as currently conducted and
as proposed to be conducted, and neither the Company nor any of its Subsidiaries
has received any written notice of infringement of or conflict with asserted
rights of others with respect to the use of Intellectual Property Rights, which
would reasonably be expected to result in any Material Adverse Effect. To the
knowledge of the Company, all Intellectual Property Rights material to its
business as currently conducted and as proposed to be conducted are valid and
enforceable and the Company has performed all acts and has paid all required
fees and taxes to maintain all registrations and applications of such
Intellectual Property Rights in full force and effect. Neither the Company nor
any of its Subsidiaries, in the conduct of their business as now conducted or as
proposed to be conducted, infringes or conflicts with any right of any third
party, known to the Company, where such infringement or conflict would
reasonably be expected to result in any Material Adverse Effect. Neither the
Company nor any of its Subsidiaries is, nor will it be as a result of the
22
execution and delivery of this Agreement and the other Documents or the
performance of any obligations hereunder and thereunder, in breach of any
license or other agreement relating to any Intellectual Property Rights, except
as would not reasonably be expected to have a Material Adverse Effect. To the
knowledge of the Company, no third party is infringing or has infringed any
Intellectual Property Rights of the Company or its Subsidiaries.
Section 4.18 Compliance with Laws. Each of the Company and its
--------------------
Subsidiaries has obtained and has maintained in good standing any licenses,
permits, consents and authorizations required to be obtained by it under all
Legal Requirements relating to its business, the absence of which would
reasonably be expected to have, individually or in the aggregate, a Material
Adverse Effect, and any such licenses, permits, consents and authorizations
remain in full force and effect, except as to any of the foregoing the absence
of which would not reasonably be expected to have, singly or in the aggregate, a
Material Adverse Effect. Each of the Company and its Subsidiaries is in
compliance, in all material respects, with all Laws and there is no pending or,
to the Company's knowledge, threatened, Proceedings against either the Company
or its Subsidiaries pursuant to any Legal Requirements, other than any such
Proceedings which, if adversely determined, would not reasonably be expected to
have, individually or in the aggregate, a Material Adverse Effect.
Section 4.19 Agreements. Except as set forth on Schedule 4.19 hereto,
---------- -------------
the Company and its Subsidiaries are not a party to any written or oral (a)
Contract with any labor union; (b) material Contract for the future purchase of
fixed assets or for the future purchase of materials, supplies or equipment in
excess of normal operating requirements; (c) Contract for the employment of any
officer, individual employee or other person on a full-time basis or any
contract with any Person on a consulting basis providing for a payment to such
officer, employee or other person in excess of $250,000 per year; (d) agreement
or indenture relating to the borrowing of money or to the mortgaging, pledging
or otherwise placing a material Lien on any assets of the Company; (e) guaranty
of any material obligation for borrowed money; (f) material lease or agreement
under which the Company is lessee of or holds or operates any property, real or
personal, owned by any other party; (g) material lease or agreement under which
the Company is lessor of or permits any third party to hold or operate any
property, real or personal, owned or controlled by the Company; (h) agreement or
other commitment for capital expenditures in excess of $1,000,000; (i) Contract,
agreement or commitment under which the Company is obligated to pay any broker's
fees, finder's fees or any such similar fees, to any third party in connection
with the Transactions; or (j) any other Contract, agreement, arrangement or
understanding, other than customer contracts, which is material to the business
of the Company. All such Contracts constitute the valid and binding obligations
of the Company and, to the knowledge of the Company, the other parties thereto,
23
enforceable in accordance with their terms, except as enforcement may be limited
by general principles of equity and by bankruptcy, insolvency and similar laws
affecting creditors' rights and remedies generally. For the purposes of this
Section 4.19, "material" shall mean any Contract involving more than $2,000,000.
------------
Section 4.20 Year 2000. The Company represents and warrants that its
---------
computer system and software are able to accurately process date data, including
but not limited to, calculating comparing and sequencing from, into and between
the twentieth century (throughout the year 1999), the year 2000 and the twenty-
first century, including leap year calculations.
Section 4.21 SEC Reports. None of the Company's filings with the SEC,
-----------
including, without limitation, the Company's Registration Statement on Form S-1
relating to the IPO, contain any untrue statement of material fact
or omitted to state a material fact required to be stated therein or necessary
in order to make the statements therein, in light of the circumstances under
which they were made, not misleading.
Section 4.22 Stockholders' Agreement. As of the Closing, the
-----------------------
Stockholders' Agreement of the Company shall have been amended and restated
substantially in the form as heretofore presented to GECC by the Company.
ARTICLE V
REPRESENTATIONS AND WARRANTIES OF EACH INVESTOR
Each Investor (as to itself only) represents and warrants to the Company
that:
Section 5.1 Organization and Standing. Such Investor is a corporation
-------------------------
or other legally recognizable entity duly organized, validly existing and in
good standing under the laws of its jurisdiction of organization.
Section 5.2 Purchase for Own Account. Such Investor is purchasing the
------------------------
Securities to be purchased by it solely for its own account and not as nominee
or agent for any other person and not with a view to, or for offer or sale in
connection with, any current distribution thereof (within the meaning of the
Securities Act) that would cause the original purchase of the Securities to be
in violation of the securities laws of the United States of America or any state
thereof, without prejudice, however, to its right at all times to sell or
otherwise dispose of all or any part of such Securities pursuant to a
registration statement under the Securities Act or pursuant to an exemption from
the registration requirements of the Securities Act, and subject, nevertheless,
to the disposition of its property being at all times within its control.
24
Section 5.3 Accredited Investor; No Solicitation. (a) Such Investor is
------------------------------------ -
knowledgeable, sophisticated and experienced in business and financial matters
and in investing in privately held and public business enterprises; it has
previously invested in securities similar to the Securities and it acknowledges
that the Securities have not been registered under the Securities Act and
understands that the Securities must be held indefinitely unless they are
subsequently registered under the Securities Act or such sale is permitted
pursuant to an available exemption from such registration requirement; it is
able to bear the economic risk of its investment in the Securities and is
presently able to afford the complete loss of such investment; and it is an
"accredited investor" as defined in Regulation D promulgated under the
Securities Act.
(b) Neither Investor made its investment decision to purchase the
-
Securities based on any form of general solicitation or general advertising used
by the Company, including, but not limited to, advertisements,
articles, notices or other communications published in any newspaper, magazine
or similar medium or broadcast over television or radio, or any seminar or
meeting whose attendees have been invited by any general solicitation or general
advertising.
Section 5.4 Qualified Institutional Buyer. Such Investor is a
-----------------------------
"qualified institutional buyer" as defined in Rule 144A promulgated under the
Securities Act.
Section 5.5 Authorization. Each Investor has taken all actions
-------------
necessary to authorize it (i) to execute, deliver and perform all of its
-
obligations under this Agreement, (ii) to perform all of its obligations under
--
the Documents and (iii) to consummate the transactions contemplated hereby and
---
thereby. This Agreement is a legally valid and binding obligation of each
Investor enforceable against it in accordance with its terms, except for (a) the
-
effect thereon of bankruptcy, insolvency, reorganization, moratorium and other
similar laws relating to or affecting the rights of creditors generally and (b)
-
limitations imposed by Federal or state law or equitable principles upon the
specific enforceability of any of the remedies, covenants or other provisions
thereof and upon the availability of injunctive relief or other equitable
remedies.
Section 5.6 ERISA. Each such Investor represents that either:
-----
(a) it is not acquiring the Securities for or on behalf of any Employee
Benefit Plan;
(b) the assets used to acquire the Securities are assets of an insurance
company general account and the purchase of the Securities would be exempt under
the provisions of Prohibited Transaction Class Exemption 95-60;
25
(c) the assets used to acquire the Securities are assets of a "venture
capital operating company" or "real estate operating company" (as defined in 29
C.F.R ' 25 10.3-101); or
(d) if it is otherwise acquiring the Securities on behalf of an employee
pension benefit plan, an employee welfare benefit plan or a "Plan," either
directly or through an investment fund (such as a bank collective investment
fund or insurance company pooled separate account), then, assuming that the
plans identified to such Investor by the Company in writing are the only
employee benefit plans (as defined in Section 3 of ERISA) or Plans with respect
to which the Company is a "party in interest" or "disqualified person" (as such
terms are defined in section 3 of ERISA and section 4975 of the Code,
respectively), either
(i) no part of the funds to be used to purchase the Securities
constitutes assets allocable to any trust that contains assets of any of such
employee benefit plans, or
(ii) exemption from the prohibited transaction rules applies such that
the use of such funds does not constitute a non-exempt prohibited transaction
in violation of section 406 of ERISA or section 4975 of the Code, which could
be subject to a civil penalty assessed pursuant to section 502 of ERISA or a
tax imposed under section 4975 of the Code.
ARTICLE VI
COVENANTS
Section 6.1 Compliance with Laws; Maintenance of Licenses. The Company
---------------------------------------------
shall, and shall cause each of its Subsidiaries to, comply with all Legal
Requirements (including all Environmental Laws) to which any of them is subject,
and maintain, obtain and keep in effect all licenses, permits, franchises and
other governmental authorizations necessary to the ownership or operation of its
properties or the conduct of its businesses, except to the extent that the
failure to so comply or maintain, obtain and keep in effect would not reasonably
be expected to have, singly or in the aggregate, a Material Adverse Effect.
Section 6.2 Inspection of Properties and Records. Until the closing of
------------------------------------
the IPO, the Company agrees to allow, and to cause each of its Subsidiaries to
allow, each Investor or subsequent Holder who continues to hold Shares with an
original cost of at least $1,000,000 (or, such Persons as any of them may
designate) (individually and collectively, "Inspectors"), subject to appropriate
----------
agreements as to confidentiality, (i) to visit and
-
26
inspect any of the properties of the Company or any of its Subsidiaries, (ii) to
--
examine all their books of records, reports and other papers and to make copies
and extracts therefrom, (iii) to discuss its affairs, finances and accounts with
---
its officers employees, and (iv) to discuss the financial condition of the
--
Company and Subsidiaries with their independent accountants upon reasonable
notice to the Company of its intention to do so and so long as the Company shall
l be given the reasonable opportunity to participate in such discussions (and by
this provision the Company authorizes such accountants to have such discussions
with the Inspectors). All such visits, examinations and discussions set forth in
the preceding sentence shall be at such reasonable times and as often as may be
reasonably requested.
Section 6.3 Financial Statements. (a) Until the closing of the IPO,
--------------------
the Company will deliver to each Investor or subsequent Holder who continues to
hold Shares with an original cost of at least $1,000,000:
(i) Not more than 30 days after the end of each month, a consolidated
balance sheet of the Company as at the end of such month and the related
consolidated statements of income of the Company for such month and (in the case
of all months other than the first month of such fiscal year) for the period
from the beginning of the current fiscal year to the end of such month, and
setting forth, in each case in comparative form, figures for the corresponding
month and each previous month and period in the Company's budget for the current
fiscal year, certified by the chief financial officer of the Company as fairly
presenting in all material respects the financial condition of the Company as at
the dates indicated and the results of their operations for the periods
indicated, prepared in accordance with GAAP consistently applied except for the
absence of footnotes and subject to changes resulting from periodic adjustments;
and
(ii) Not more than 90 days after the end of each fiscal year of the
Company, a consolidated balance sheet of the Company as of such year and the
related consolidated statements of income and cash flows of the Company for such
year, corresponding figures from the preceding fiscal year, and in the case of
such consolidated financial statements, accompanied by a report thereon of
PriceWaterhouseCoopers or such other independent public accountants of
recognized national standing selected by the Company, which report shall state
that such consolidated financial statements were prepared in accordance with
GAAP consistently applied and present fairly in all material respects the
consolidated financial condition of the Company as of the dates indicated; and
(b) Following the closing of the IPO, the Company will deliver to each
Investor or subsequent Holder who owns Shares all financial information made
available generally to its stockholders.
27
Section 6.4 Indemnification for Finder's Fees. The Company hereby
---------------------------------
agrees to indemnify each Investor, each Affiliate of an Investor, and each
director, officer, partner, employee, counsel, agent or representative thereof
against and hold them harmless from all losses, claims, damages or other
liabilities arising from any finder's or other brokers or investment banker fees
with respect to any finder, broker or investment banker retained by or
authorized to act on behalf of, the Company or any of its Subsidiaries with
respect to the transactions contemplated hereunder.
Section 6.5 Publicity; Press Releases. Neither the Company nor any of
-------------------------
the Investors shall issue any press release or make any public disclosure
regarding the Investors' investment in the Company contemplated hereby (other
than as set forth in the Registration Statement, any amendment thereto or any
other securities laws filing) unless such press release or public disclosure is
approved by a majority in interest of the Investors or the Company, as the case
may be, in advance.
Section 6.6 Lock Up. Each Investor agrees that it shall not Transfer
-------
any shares of Common Stock or Warrant Shares for 180 days after any underwritten
public offering of shares of Common Stock (including in the IPO) unless the
managing underwriter for such offering decides such restriction is unnecessary,
and each Investor agrees to execute any agreement or document reasonably
requested by any such underwriter which relates to such restriction; provided,
however, that this Section 6.6 shall not apply to transfers to an Investor's
Affiliates or pursuant to the exercise of any incidental registration rights of
an Investor.
Section 6.7 No Purchases in the IPO. Each Investor agrees that it shall
-----------------------
not purchase any shares of the Common Stock in the IPO. GE Capital Equity
Investments, Inc. further agrees that it shall send written notice to the
General Counsel of each of the subsidiaries of General Electric Capital
Corporation advising them that such subsidiaries should not purchase any shares
of the Common Stock in the IPO.
Section 6.8 HSR Filing. Each party hereto agrees to (i) take reasonable
---------- -
best efforts to prepare and file, as soon as practicable after the date hereof,
but in any event in not more than 15 Business Days from the date hereof, the
notification required by it under the HSR Act with respect to the Transactions,
(ii) request early termination of the waiting period with respect thereto,
--
and (iii) diligently respond to any inquiries arising therefrom.
---
ARTICLE VII
MISCELLANEOUS
Section 7.1 Notices. All notices, demands, requests, consents or
-------
approvals (collectively, "Notices") required or permitted to be given hereunder
-------
or which are given
with respect to this Agreement shall be in writing and shall be personally
delivered or mailed, registered or certified, return receipt requested, postage
prepaid (or by a substantially similar method), or delivered by a reputable
overnight courier service with charges prepaid, or transmitted by hand delivery,
telegram, telex or facsimile, addressed as set forth below, or such other
address (and with such other copy) as such party shall have specified most
recently by written notice. Notice shall be deemed given or delivered on the
date of service or transmission if personally served or transmitted by telegram,
telex or facsimile. Notice otherwise sent as provided herein shall be deemed
given or delivered on the third Business Day following the date mailed or on the
next Business Day following delivery of such notice to a reputable overnight
courier service.
To the Company:
iXL Enterprises, Inc.
Two Park Place
0000 Xxxxx Xxxxxx, 0xx Xxxxx
Xxxxxxx, Xxxxxxx, 00000
Attention: Mr. M. Xxxxx Xxxxxxxx
Telecopy No.: (000) 000-0000
with a copy (which shall not constitute Notice) to:
Xxxxxx & Xxxxxx, PC
One Buckhead Plaza
0000 Xxxxxxxxx Xxxxxx, X.X., Xxxxx 0000
Xxxxxxx, Xxxxxxx 00000
Attn: Xxxxx X. Xxxxxxxxx, Esq.
Telecopy No.: (000) 000-0000
with an additional copy (which shall not constitute Notice) to:
Xxxxx & Company
000 Xxxx Xxxxxx
00xx Xxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attn: Xxxxx X. Xxxxxxx XX, Esq.
Telecopy No.: (000) 000-0000
with an additional copy (which shall not constitute Notice) to:
29
Debevoise & Xxxxxxxx
000 Xxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attn: Xxxxxxxx X. Xxxxxxxxx, Esq.
Telecopy No.: (000) 000-0000
To the Investors:
To the address specified on the signature page executed by each such
Investor.
with a copy (which shall not constitute Notice) to:
Weil, Gotshal & Xxxxxx LLP
000 Xxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attn: Xxxxxxx Xxxxxxxx, Esq.
Telecopy No.: (000) 000-0000
Section 7.2 Successors and Assigns. This Agreement shall be binding
----------------------
upon and shall inure to the benefit of the parties hereto, and their respective
successors and permitted assigns; provided that (i) neither this Agreement nor
-
any rights or obligations hereunder may be transferred or assigned by the
Company (except by operation of law in any merger) and (ii) neither this
--
Agreement nor any rights or obligations hereunder may be transferred or assigned
by any Investor except to any Affiliate to whom such Investor has transferred
Securities.
Section 7.3 No Waivers; Amendments. (a) No failure or delay by any
----------------------
party in exercising any right, power or privilege hereunder shall operate as a
waiver thereof, nor shall any single or partial exercise thereof preclude any
other or further exercise thereof or the exercise of any other right, power or
privilege. The rights and remedies herein provided shall be cumulative and not
exclusive of any rights or remedies provided by law.
(b) This Agreement may not be amended or modified, nor may any provision
hereof be waived, other than by a written instrument signed by (x) the Company
-
and (y) each Investor.
-
Section 7.4 Counterparts. This Agreement may be signed in counterparts,
------------
each of which shall constitute an original and which together shall constitute
one and the same agreement.
30
Section 7.5 Section Headings. The section headings contained in this
----------------
Agreement are for reference purposes only and shall not affect the meaning or
interpretation of this Agreement.
Section 7.6 GOVERNING LAW; SUBMISSION TO JURISDICTION; WAIVER OF JURY
---------------------------------------------------------
TRIAL. THIS AGREEMENT SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE
-----
LAWS OF THE STATE OF NEW YORK, AS APPLIED TO CONTRACTS MADE AND PERFORMED WITHIN
THE STATE OF NEW YORK, WITHOUT REGARD TO PRINCIPLES OF CONFLICT OF LAWS.
EACH OF THE PARTIES HERETO HEREBY IRREVOCABLY SUBMITS TO THE EXCLUSIVE
JURISDICTION OF ANY NEW YORK STATE COURT SITTING IN THE BOROUGH OF MANHATTAN IN
THE CITY OF NEW YORK OR ANY FEDERAL COURT SITTING IN THE BOROUGH OF MANHATTAN IN
THE CITY OF NEW YORK IN RESPECT OF ANY ACTION ARISING OUT OF OR RELATING TO THIS
AGREEMENT, AND IRREVOCABLY ACCEPTS FOR ITSELF AND IN RESPECT OF ITS PROPERTY,
GENERALLY AND UNCONDITIONALLY, JURISDICTION OF THE AFORESAID COURTS. THE COMPANY
AGREES THAT IT WILL NOT COMMENCE ANY SUCH ACTION IN ANY OTHER JURISDICTION. EACH
OF THE PARTIES HERETO IRREVOCABLY WAIVES, TO THE FULLEST EXTENT IT MAY
EFFECTIVELY DO SO UNDER APPLICABLE LAW, ANY OBJECTION WHICH IT MAY NOW OR
HEREAFTER HAVE TO THE LAYING OF THE VENUE OF ANY SUCH ACTION BROUGHT IN ANY SUCH
COURT AND ANY CLAIM THAT ANY SUCH ACTION BROUGHT IN ANY SUCH COURT HAS BEEN
BROUGHT IN AN INCONVENIENT FORUM. NOTWITHSTANDING THE FOREGOING, NOTHING HEREIN
SHALL AFFECT THE RIGHT OF THE INVESTORS TO SERVE PROCESS IN ANY OTHER MANNER
PERMITTED BY LAW OR TO COMMENCE LEGAL PROCEEDINGS OR OTHERWISE PROCEED AGAINST
THE COMPANY IN ANY OTHER JURISDICTION.
EACH OF THE PARTIES HERETO HEREBY WAIVES THEIR RESPECTIVE RIGHTS TO A
JURY TRIAL OF ANY CLAIM OR CAUSE OF ACTION BASED UPON OR ARISING OUT OF THIS
AGREEMENT OR ANY OF THE OTHER DOCUMENTS, OR ANY DEALINGS BETWEEN THEM RELATING
TO THE SUBJECT MATTER OF THE INVESTORS' INVESTMENT IN THE COMPANY CONTEMPLATED
HEREBY. THE SCOPE OF THIS JURY TRIAL WAIVER SHALL BE LIMITED TO DISPUTES BETWEEN
THE COMPANY AND THE INVESTORS AND SHALL NOT EXTEND TO DISPUTES BETWEEN THE
COMPANY AND ANY OTHER PERSON.
31
Section 7.7 Entire Agreement. This Agreement, together with the other
----------------
Documents, constitutes the entire agreement and understanding among the parties
hereto with respect to the subject matter hereof and thereof and supersedes any
and all prior agreements and understandings, written or oral, relating to the
subject matter hereof.
Section 7.8 Severability. Any term or provision of this Agreement which
------------
is invalid or unenforceable in any jurisdiction shall, as to such jurisdiction,
be ineffective to the extent of such invalidity or unenforceability without
rendering invalid or unenforceable the remaining terms and provisions of this
Agreement or affecting the validity or enforceability of any of the terms or
provisions of this Agreement in any other jurisdictions, it being intended that
all rights and obligations of the parties hereunder shall be enforceable to the
fullest extent permitted by law.
Section 7.9 Further Assurances. The Company shall, and shall cause each
------------------
of its Subsidiaries to, at its cost and expense, upon request of any Investor or
Holder, duly execute and deliver, or cause to be duly executed and delivered, to
such Investor or Holder such further instruments and do or cause to be done such
further acts as may be necessary or proper in the reasonable opinion of such
Investor or Holder to carry out more effectually the provisions and purposes of
this Agreement and the other Documents.
Section 7.10 No Survival of Representations and Warranties; No Recourse.
----------------------------------------------------------
The representations and warranties in this Agreement shall not survive the
Closing, other than the representations and warranties of the Company set forth
in Sections 4.4, 4.5, 4.6, 4.7, 4.10 and 4.21 hereof, which shall survive until
the first anniversary of the Closing. In no event shall the Investors have any
recourse against the present or former directors, officers or stockholders of
the Company or any of its Affiliates with respect to any representation,
warranty or agreement made by the Company in this Agreement, except in the case
of fraud, in which case the Investor's right shall be governed by applicable
law.
Section 7.11 Termination. At any time after August 31, 1999, any
-----------
party may terminate this Agreement if the Closing shall not have taken place by
August 31, 1999, unless the failure to consummate the Closing is the result of a
willful and material breach by the party seeking to terminate this Agreement. In
the event of the termination of this Agreement pursuant to this Section 7.11,
this Agreement shall be of no further force and effect.
Section 7.12 Disclosure of Financial Information. Each Holder is hereby
-----------------------------------
authorized to deliver a copy of any financial statement or any other information
relating to the business, operations or financial condition of the Company or
each of its Subsidiaries which may be furnished to it hereunder or otherwise, to
any other Holder, any court, Governmental Body claiming to have jurisdiction
over such Holder, to the National Association of Insurance Commissioners or
similar organizations, as may be required or
32
appropriate in response to any summons or subpoena in connection with any
litigation, to the extent necessary to comply with any law, order, regulation or
ruling applicable to such Holder, or to any rating agency, in order to protect
its investment hereunder; provided, however, that prior to disclosing any such
information, such Holder shall provide the Company with prompt written notice so
that the Company may seek a protective order or other appropriate remedy if the
Company reasonably determines that such information must be kept confidential.
Each Holder is hereby authorized to deliver a copy of any financial
statement or any other information relating to the business, operations or
financial condition of the Company or each of its Subsidiaries which may be
furnished to it hereunder or otherwise, to any Person which shall, or shall have
any right or obligation to, succeed to all or any part of such Holder's interest
in any of the Securities and this Agreement or to any actual or prospective
purchaser or assignee thereof; provided, however, that no disclosure may be made
unless such other Person first executes a confidentiality agreement acceptable
to the Company with respect to any such information disclosed.
[Signature pages follow]
33
IN WITNESS WHEREOF, this Securities Purchase Agreement has been duly executed
by the parties set forth below as of the date first written above.
iXL ENTERPRISES, INC.
By: /s/ M. Xxxxx Xxxxxxxx
----------------------------
Title: Executive Vice President
-------------------------
Address:
-------
GE CAPITAL EQUITY INVESTMENTS, INC.
000 Xxxx Xxxxx Xxxx By: /s/ Xxxxxxx Xxxxx
Xxxxxxxx, XX 00000 ----------------------------
Title: Managing Director
-------------------------
Address:
-------
GENERAL ELECTRIC PENSION TRUST
0000 Xxxxxx Xx. By: General Electric Investment
Xxxxxxxx, XX 00000 Corporation, its Investment Manager
By: /s/ Xxxxxxx X. XxXxxxx
-----------------------------
Title: Vice President
--------------------------
Annex 1
Name of Investor Securities Purchased
GE Capital Equity Investments, Inc. 1,500,000 shares of Common Stock
1,500,000 Warrants
General Electric Pension Trust 500,000 shares of Common Stock
35
