October 31, 2018
Exhibit 99.2
EXECUTION COPY
October 31, 2018
WC SACD One, Inc.
c/o iSubscribed, Inc.
00 Xxxxxxx Xxxxx
Burlington, MA 01803
Ladies and Gentlemen:
Reference is hereby made to that certain Agreement and Plan of Merger (the “Merger Agreement”), dated as of October 31, 2018, by and among WC SACD One Parent, Inc., a Delaware corporation (“Parent”), WC SACD One Merger
Sub, Inc., a Delaware corporation and a wholly-owned Subsidiary of Parent (“Merger Sub”), and Intersections Inc., a Delaware corporation (the “Company”). Capitalized terms used and not otherwise defined herein have the meanings ascribed to them in the Merger Agreement.
1. Commitment. Subject to the terms and conditions set forth in this letter agreement, each of the undersigned (each, an “Equity
Investor” and together, the “Equity Investors”) hereby severally, and not jointly, agrees to make an equity contribution, or cause one or more of its Affiliates to make an equity contribution (any such Affiliate, a “participating Affiliate”), to WC SACD One, Inc., a Delaware corporation and the parent company to Parent (“WC SACD One”), immediately prior to the time Parent, Merger Sub and the Company become obligated under the
Merger Agreement to effect the consummation of the Offer and the Closing, as applicable, in an amount equal to its pro rata percentage (as set forth on Schedule A) (“Pro Rata Percentage”) of the Aggregate
Equity Commitment (as defined below), which amount in turn shall be contributed by WC SACD One to Parent (the “Parent Equity Contribution”) pursuant to a letter agreement between WC SACD One and Parent, dated as of the date hereof, and used by Parent, together with other financial resources of Parent and Merger Sub, including cash, cash
equivalents and marketable securities of Parent and Merger Sub on the Closing Date, for the purpose of enabling (a) Parent to cause Merger Sub to accept for payment and pay for any and all Shares validly tendered pursuant to the Offer at the
Acceptance Time (the “Offer Amount”), (b) Parent and the Surviving Corporation, as applicable, to
make payments due under Sections 3.2, 3.3(a) and 3.4(a) of the Merger Agreement (the “Merger Amount”),
and (c) the payment of any fees, costs and expenses required to be paid by Parent or Merger Sub in connection with the transactions contemplated by the Merger Agreement, on the terms and subject to the conditions of the Merger Agreement (the “Expense Amount”). Notwithstanding anything to the contrary in this letter agreement, in no event shall any
Equity Investor (together with its participating Affiliates and assigns) be under any obligation under any circumstances to provide an aggregate amount of funds of more than its Equity Commitment (as defined below) to WC SACD One or any other
Person, and in no event will the Equity Investors (together with their respective participating Affiliates and assigns), in the aggregate, be under any obligation under any circumstances to
provide an aggregate amount of funds of more than the Aggregate Equity Commitment to WC SACD One or any other Person. For purposes of this letter
agreement, the term (A) “Aggregate Equity Commitment” means an amount equal to: (i) $73,435,910; provided, however, that the amount of the Aggregate Equity Commitment (a)
shall be reduced by any amount paid by Parent, Merger Sub, WC SACD One, any of the Guarantors or any of their respective Affiliates related to or arising out of the transactions contemplated by the Merger Agreement (including without limitation any
payments made under the Limited Guaranty), and (b) shall be reduced by WC SACD One (1) in an amount specified by WC SACD One solely to the extent that, after giving effect to such reduction and the corresponding reduction in the Parent Equity
Contribution, Parent would still be able to consummate the transactions contemplated by the Merger Agreement in accordance with the terms thereof, and (2) on a dollar-for-dollar basis by the amount of any additional third-party financing obtained
by Parent, Merger Sub or any of their respective wholly-owned subsidiaries at or prior to the Closing; provided, however, that the Aggregate Equity Commitment shall not be reduced pursuant to this clause (2) unless and until such third party
financing is funded ; and (B) “Equity Commitment” with respect to an Equity Investor means an amount equal to the product of its Pro Rata Percentage, multiplied by the Aggregate Equity Commitment. For the avoidance of doubt, each Equity Investor’s Equity Commitment is only payable upon the fulfillment of the
conditions set forth in Section 2 hereof and for the uses described above and shall not be payable at any other time, under any other circumstances or for any other
purpose, and is not a guaranty of collection or the performance of any other obligations of WC SACD One, Parent, Merger Sub or any other Person.
2. Funding
Conditions. Each Equity Investor’s obligation to fund (or cause its participating Affiliates to fund) all or part of its Equity Commitment is subject in all respects to
the terms and conditions of this letter agreement and to (a) with respect to the Offer Amount, (i) the execution and delivery of the Merger Agreement by Parent, Merger Sub and the Company, (ii) the satisfaction in full or valid waiver of all of
the Offer Conditions (other than those Offer Conditions that by their nature are to be satisfied at the Acceptance Time, but subject to the concurrent satisfaction or waiver of such Offer Conditions at the Acceptance Time), and (iii) the
substantially concurrent acceptance for payment by Merger Sub of all Shares validly tendered and not validly withdrawn pursuant to the Offer, and (b) with respect to the Merger Amount and Expense Amount, (i) the execution and delivery of the
Merger Agreement by Xxxxxx, Merger Sub and the Company, (ii) the satisfaction or waiver of all of the conditions precedent to Parent’s and Xxxxxx Sub’s obligations set forth in Section 7.1 of the Merger Agreement (other than those conditions
precedent that by their nature are to be satisfied at the Closing, but subject to the concurrent satisfaction or waiver of such conditions precedent at the Closing), and (iii) the substantially concurrent consummation of the Merger on the terms
and subject to the conditions of the Merger Agreement.
3. Representations
and Warranties. Each Equity Investor hereby represents and warrants to WC SACD One, that, (a) upon execution and delivery of the Merger Agreement, this letter agreement
will constitute a legal, valid and binding obligation of such Equity Investor enforceable against such Equity Investor in accordance with its terms (except to the extent that enforceability may be limited by applicable bankruptcy, insolvency,
moratorium, reorganization or similar Laws affecting the enforcement of creditors’ rights generally or by general principles of equity); (b) such Equity Investor has the requisite corporate, limited liability company or limited partnership power
and authority, as applicable, to enter into this letter agreement and to
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perform its obligations hereunder; (c) the execution, delivery and performance of this letter agreement by such Equity Investor has been duly and validly
authorized by all necessary corporate, limited liability company or limited partnership action, as applicable, and does not contravene, conflict with or result in any violation of any provision of such Equity Investor’s charter, partnership
agreement, operating agreement or similar organizational document; (d) such Equity Investor (and/or its participating Affiliates, as applicable) has sufficient cash or unfunded capital commitments to cause its Equity Commitment to be made available
to WC SACD One in order to allow WC SACD One to perform its obligations pursuant to and in accordance with this letter agreement; and (e) all funds necessary for such Equity Investor (and/or its participating Affiliates, as applicable) to perform
all of its obligations under this letter agreement shall be available (in the form of cash or unfunded capital commitments) to it for so long as this letter agreement shall remain in effect, and no additional internal approval is needed to fulfill
such Equity Investor’s obligations hereunder.
4. Limited
Guaranty. Concurrently with the execution and delivery of this letter agreement and the Merger Agreement, each of WndrCo Holdings, LLC, a Delaware limited liability
company, General Catalyst Group IX, L.P., a Delaware limited partnership, GC Entrepreneurs Fund IX, L.P., a Delaware limited partnership, and iSubscribed, Inc., a Delaware corporation (each, a “Guarantor” and collectively, the “Guarantors”) is executing and delivering to the Company a Limited Guaranty (the “Limited Guaranty”) relating to certain of Parent’s monetary obligations under the Merger Agreement. Except as provided in Section
8, the Company’s remedies against the Guarantors under such Limited Guaranty shall and are intended to be the sole and exclusive direct and indirect remedies available to
the Company, the Company’s equityholders and their respective Affiliates and Subsidiaries. Notwithstanding anything that may be expressed or implied in this letter agreement, the Merger Agreement, the Limited Guaranty or any document or
instrument delivered in connection herewith or therewith, (a) in no event shall any Guarantor have any obligation to make any payment to the Company, the Company’s equityholders or their respective Affiliates and Subsidiaries at any time, (b) in
no event shall any Guarantor have any obligation to make any contribution to WC SACD One at any time after the Guarantors have made payment of the full amount of the Guaranteed Obligations (as defined in the Limited Guaranty) required to be paid
pursuant to the terms and definitions of the Limited Guaranty, and (c) in no event shall any Guarantor have any obligation or liability to any other Guarantor by reason of this letter agreement or the Limited Guaranty.
5. No
Recourse. Notwithstanding anything that may be expressed or implied in this letter agreement, the Merger Agreement, the Limited Guaranty or any document or instrument
delivered in connection herewith or therewith or any of the transactions contemplated hereby or thereby (including the termination or abandonment thereof), WC SACD One, by its acceptance of this letter agreement, and the Company, in its capacity
as a third party beneficiary solely as and to the extent specified in, and on the terms and subject to the conditions of Section 8 hereof, each unconditionally and irrevocably covenants, agrees and acknowledges on behalf of itself and its controlled Affiliates that (a) no Person other than the Equity Investors shall have any obligations or
liabilities hereunder; (b) notwithstanding that certain of the Equity Investors are organized as limited liability companies or limited partnerships, as applicable, no right or remedy, recourse or recovery hereunder, under the Merger Agreement,
or under any document or instrument delivered in connection herewith or therewith or in connection with the transactions contemplated hereby or thereby (or the termination or abandonment thereof), or in respect of any
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oral representations made or alleged to be made in connection herewith or therewith shall be had against any Non-Recourse Party (as defined below) of any
Equity Investor (or its respective participating Affiliates), whether by the enforcement of any judgment or assessment or by any legal, equitable, investigative or arbitral proceeding, or by virtue of any statute, regulation or other applicable law
(including common law), other than the Retained Claims (as expressly defined in, and subject to the limitations contained in, the definition of Retained Claims set forth below); and (c) no personal liability or obligation whatsoever will attach to,
be imposed on or otherwise be incurred by any Non-Recourse Party of any Equity Investor (or its respective participating Affiliates) for any liabilities or obligations of WC SACD One or any Equity Investor (or participating Affiliates) under this
letter agreement or any documents or instruments delivered in connection herewith or in connection with the transactions contemplated hereby (or the termination or abandonment thereof), or in respect of any oral representations made or alleged to
be made in connection herewith or for any claim, action, suit, arbitration, litigation, investigation or proceeding based on, in respect of or by reason of such obligations or by their creation (including the breach, termination or failure to
consummate the transactions contemplated by the Merger Agreement ), in the case of each of clauses (a), (b) and (c), whether based on contract, tort, strict liability, other laws (including common law) or otherwise, and whether by or through
piercing of the corporate, limited liability company or limited partnership veil or similar action, by or through a claim by or on behalf of a party hereto or another Person or otherwise.
For purposes of this Section 5, “Non-Recourse Party” means, with respect to each Equity Investor, its Affiliates and its and their former, current and future directors, trustees, officers, employees, agents and Affiliates
(both direct and indirect), the former, current and future holders (both direct and indirect) of any equity interests or securities of the foregoing (whether such holder is a limited or general partner, member, stockholder or otherwise), the
former, current or future assignees of the foregoing and the former, current or future directors, trustees, officers, employees, agents, general or limited partners, managers, members, stockholders, Affiliates, controlling persons, representatives
or assignees of the foregoing.
For purposes of this letter agreement, “Retained Claims”
means, collectively, (i) claims by the Company against Parent or Merger Sub in respect of liabilities for which recovery may be made against Parent or Merger Sub under and in accordance with the Merger Agreement; (ii) to the extent the Company is
expressly entitled to enforce this letter agreement in accordance with the terms hereof, the exercise of the Company’s third party beneficiary rights under and in accordance with this letter agreement; (iii) with respect to the Confidentiality
Agreement between the Company and iSubscribed, Inc., an Affiliate of Parent, dated as of September 20, 2018 (the “Confidentiality Agreement”), claims by the Company
against iSubscribed, Inc., in respect of liabilities for which recovery may be made under and in accordance with the Confidentiality Agreement; and (iv) claims by the Company against any Guarantor, severally but not jointly, under and in accordance
with the Limited Guaranty (as limited by the provisions of Section 2 therein).
6. Termination. This letter agreement and each Equity Investor’s obligation to fund (or cause its participating Affiliates to fund) all or any portion of its Equity Commitment will automatically
terminate and cease to be of any further force or effect without the need for any further action by any Person (at which time the obligations of each Equity Investor hereunder
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shall be immediately discharged) upon the earliest of (a) the termination of the Merger Agreement in accordance with its terms, (b) the Closing, at which
time the obligations hereunder shall be discharged, and (c) written notice to WC SACD One by any Equity Investor of such Equity Investor’s election to terminate this letter agreement as a result of the assertion, directly or indirectly, by or on
behalf of the Company or any of its Affiliates, or any of its or their respective Representatives, of any claim (whether at Law or equity or in tort, contract or otherwise) against any Non-Recourse Party in connection with this letter agreement,
the Merger Agreement, the Limited Guaranty or any other document or instrument delivered in connection herewith or therewith or any of the transactions contemplated hereby or thereby (including the termination or abandonment thereof), except,
solely with respect to clause (c), in respect of a Retained Claim. Immediately upon termination of this letter agreement and without the need for any further action by any Person, none of WC SACD One, any of the Equity Investors nor any
Non-Recourse Party shall have any obligation or liability hereunder. WC SACD One shall provide prompt written notice to all Equity Investors of the occurrence of any termination pursuant to clause (a) or (c) above.
7. No
Assignment. Subject to the remainder of this Section 7, the commitment evidenced by this letter agreement shall not be assignable (a) by WC SACD One, without the prior written consent of each Equity Investor; or (b) by any Equity Investor, without the prior written
consent of each other Equity Investor, WC SACD One and the Company. The granting of such consent in any given instance shall be solely in the discretion of WC SACD One, the Company and/or each Equity Investor, as applicable, and, if granted,
shall not constitute a waiver of this requirement as to any subsequent assignment. Notwithstanding the foregoing, each Equity Investor may, without consent, assign all or a portion of its commitment hereunder to one or more of its Affiliates.
If an Equity Investor assigns all or a portion of its commitment in accordance with the preceding sentence, such Equity Investor shall remain liable in full to perform all of its obligations hereunder, but only to the extent that one or more of
its applicable Affiliates have not satisfied such Equity Investor’s funding obligations. Any purported assignment of any commitment evidenced by this letter agreement in contravention of this Section 7 shall be null and void.
8. Third
Party Beneficiaries. This letter agreement shall inure to the benefit of, and be binding upon, each of the Equity Investors for the benefit of WC SACD One. Nothing set
forth in this letter agreement is intended to, shall confer upon or give to the Company, the Company’s equityholders or their respective Affiliates or any other Person (other than WC SACD One) any benefits, rights or remedies under or by reason
of, or any rights to enforce or cause any Equity Investor to perform or fund, its Equity Commitment or any provisions of this letter agreement; provided that, notwithstanding the foregoing, the Company shall, solely to the extent that the Company is awarded, in accordance with, and subject to the conditions set forth in Section 9.10(b) of
the Merger Agreement, specific performance of Parent’s obligation to consummate the Closing, be a third party beneficiary of the rights granted to WC SACD One under this letter
agreement solely for the purpose of seeking specific performance of WC SACD One’s rights to cause each Equity Investor’s Equity Commitment to be funded hereunder; provided, further that the Non-Recourse Parties
shall be express third party beneficiaries of the provisions set forth herein that are for the benefit of the Non-Recourse Parties, each of which shall survive an expiration or termination of this letter agreement.
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9. Enforceability. Except as set forth in Section 8, no
Person other than WC SACD One shall have the right to enforce this letter agreement. Without limiting the foregoing, none of the Equity Investors, the creditors of WC SACD One, Parent, Merger Sub or the Company, the Company’s equityholders or
any of their respective Affiliates shall have any right to enforce this letter agreement or to cause WC SACD One to enforce this letter agreement. Subject to the Company’s third party beneficiary rights in Section 8, WC SACD One’s right to enforce this letter agreement shall be in its sole and absolute discretion. No Equity Investor shall
be liable hereunder to any party for any consequential, special, punitive or indirect damage or for lost profits or, in any event, in an aggregate amount in excess of its Equity Commitment.
10. Confidentiality. This letter agreement shall be treated as confidential and is being provided to WC SACD One (and made available to the Company) solely in connection with the Merger Agreement. This
letter agreement may not be used, circulated, quoted or otherwise referred to in any document (other than the Merger Agreement and Limited Guaranty), except with the written consent of each Equity Investor; provided, that (a) WC SACD One may
disclose this letter agreement to Parent and Xxxxxx Sub and their respective officers, directors, advisors and other authorized representatives, (b) the Company may disclose this letter agreement to its officers, directors, advisors and other
authorized representatives, (c) each Equity Investor may disclose this letter agreement to each of its Affiliates and its and their respective officers, directors, advisors and other authorized representatives, and also may disclose its Equity
Commitment and the Aggregate Equity Commitment to such Equity Investor’s and its Affiliates’ existing and prospective stockholders, limited partners and non-managing members on a confidential basis in accordance with such Equity Investor’s
customary reporting practices, and (d) each of the Equity Investors, WC SACD One, Parent, Merger Sub and the Company may disclose the existence of this letter agreement to the extent required by applicable Law, the applicable rules of any
national securities exchange, in connection with any securities regulatory agency filings relating to the transactions contemplated by the Merger Agreement or in connection with the enforcement of any rights hereunder.
11. Severability. Whenever possible, each provision or portion of any provision of this letter agreement shall be interpreted in such manner as to be effective and valid under applicable Law, but if any
provision or portion of any provision of this letter agreement is held to be invalid, illegal or unenforceable in any respect under any applicable Law or rule in any jurisdiction, such invalidity, illegality or unenforceability shall not affect
any other provision or portion of any provision in such jurisdiction, and this letter agreement shall be reformed, construed and enforced in such jurisdiction as if such invalid, illegal or unenforceable provision or portion of any provision had
never been contained herein.
12. Governing
Law. This letter agreement and all disputes or controversies arising out of or relating to this letter agreement or the transactions contemplated hereby shall be
governed by, and construed in accordance with, the internal laws of the State of Delaware, without regard to the laws of any other jurisdiction that might be applied because of the conflicts of laws principles of the State of Delaware.
13. Submission
to Jurisdiction. Each of the parties irrevocably agrees that any legal action or proceeding arising out of or relating to this letter agreement brought by any
party or its Affiliates against any other party or its Affiliates shall be brought and determined in the Court of Chancery
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of the State of Delaware, provided, that if jurisdiction is not then available in the Court of Chancery of the State of Delaware, then any such legal
action or proceeding may be brought in any federal court located in the State of Delaware or any other Delaware state court. Each of the parties hereby irrevocably submits to the jurisdiction of the aforesaid courts for itself and with respect to
its property, generally and unconditionally, with regard to any such action or proceeding arising out of or relating to this letter agreement and the transactions contemplated hereby. Each of the parties agrees not to commence any action, suit or
proceeding relating thereto except in the courts described above in Delaware, other than actions in any court of competent jurisdiction to enforce any judgment, decree or award rendered by any such court in Delaware as described herein. Each of
the parties further agrees that notice as provided herein shall constitute sufficient service of process and the parties further waive any argument that such service is insufficient. Each of the parties hereby irrevocably and unconditionally
waives, and agrees not to assert, by way of motion or as a defense, counterclaim or otherwise, in any action or proceeding arising out of or relating to this letter agreement or the transactions contemplated hereby, (a) any claim that it is not
personally subject to the jurisdiction of the courts in Delaware as described herein for any reason, (b) that it or its property is exempt or immune from jurisdiction of any such court or from any legal process commenced in such courts (whether
through service of notice, attachment prior to judgment, attachment in aid of execution of judgment, execution of judgment or otherwise) and (c) that (i) the suit, action or proceeding in any such court is brought in an inconvenient forum, (ii) the
venue of such suit, action or proceeding is improper or (iii) this letter agreement, or the subject matter hereof, may not be enforced in or by such courts.
14. WAIVER
OF JURY TRIAL. EACH OF THE PARTIES TO THIS LETTER AGREEMENT HEREBY IRREVOCABLY WAIVES ALL RIGHT TO A TRIAL BY JURY IN ANY ACTION, PROCEEDING OR COUNTERCLAIM ARISING OUT
OF OR RELATING TO THIS AGREEMENT OR THE TRANSACTIONS CONTEMPLATED HEREBY.
15. Notices. All notices and other communications hereunder shall be in writing and shall be deemed duly given (a) on the date of delivery if delivered personally, or if by facsimile or e mail, upon
written confirmation of receipt by facsimile, e mail or otherwise, (b) on the first Business Day following the date of dispatch if delivered utilizing a next-day service by a recognized next-day courier, or (c) on the earlier of confirmed receipt
or the fifth Business Day following the date of mailing if delivered by registered or certified mail, return receipt requested, postage prepaid. All notices hereunder shall be delivered to the addresses set forth in a party’s signature page
hereto, or pursuant to such other instructions as may be designated in writing by the party to receive such notice.
16. Entire
Agreement. This letter agreement constitutes the entire agreement, and supersedes all prior written agreements, arrangements, communications and understandings and all
prior and contemporaneous oral agreements, arrangements, communications and understandings among the parties, with respect to the subject matter hereof.
17. Amendment. This letter agreement may not be modified, amended, supplemented, cancelled or discharged, except by written instrument executed by all of the parties hereto.
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18. Counterparts. This letter agreement may be executed in two or more counterparts, all of which shall be considered one and the same instrument and shall become effective when one or more counterparts
have been signed by each of the parties and delivered to the other party.
19. Facsimile
or .pdf Signature. This letter agreement may be executed by facsimile or .pdf signature and a facsimile or .pdf signature shall constitute an original for all purposes.
Signature pages follow.
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Sincerely,
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WndrCo Holdings, LLC
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By:
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/s/ Xxxxxx Xxxxx
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Name: Xxxxxx Xxxxx
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Title: General Counsel
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Address for Notices:
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c/o WndrCo, LLC
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0000 Xxxxxxxx Xxxxxxxxx, Xxxxx 000
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Beverly Hills, CA 90210
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Attn: Xxxxxx Xxxxx, General Counsel
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xxxxxx@xxxxxx.xxx
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Signature Page to Equity Commitment Letter
GENERAL CATALYST GROUP IX, L.P.
a Delaware corporation
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By:
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General Catalyst Partners IX, L.P.
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its General Partner
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By:
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General Catalyst GP IX, LLC
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its General Partner
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By:
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/s/ Xxxxxxxxxxx XxXxxx
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Name: Xxxxxxxxxxx XxXxxx
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Title: Chief Legal Officer
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Address for Notices:
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General Catalyst Group IX, L.P.
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00 Xxxxxxxxxx Xxxx, Xxxxx 000
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Cambridge, MA 02138
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Attn: Xxxxxxxxxxx XxXxxx
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With a copy to:
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Xxxxx Xxxxxxxx Xxxx
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Xxxx X. Xxxxxxxxx
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Ropes & Gray LLP
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Prudential Tower, 000 Xxxxxxxx Xxxxxx
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Boston, MA 02199-3600
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Signature Page to Equity Commitment Letter
GC ENTREPRENEURS FUND IX, L.P.
a Delaware corporation
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By:
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General Catalyst Partners IX, L.P.
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its General Partner
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By:
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General Catalyst GP IX, LLC
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its General Partner
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By:
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/s/ Xxxxxxxxxxx XxXxxx
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Name: Xxxxxxxxxxx XxXxxx
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Title: Chief Legal Officer
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Address for Notices:
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General Catalyst Group IX, L.P.
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00 Xxxxxxxxxx Xxxx, Xxxxx 000
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Cambridge, MA 02138
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Attn: Xxxxxxxxxxx XxXxxx
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With a copy to:
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Xxxxx Xxxxxxxx Xxxx
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Xxxx X. Xxxxxxxxx
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Ropes & Gray LLP
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Prudential Tower, 000 Xxxxxxxx Xxxxxx
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Boston, MA 02199-3600
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Signature Page to Equity Commitment Letter
Xxxxxx and Accepted as of this 31st day of October, 2018 by:
WC SACD One, Inc.
By: |
/s/ Xxxx Xxxxxxxxxxxx
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Name: |
Xxxx Xxxxxxxxxxxx
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Title: |
Chief Executive Officer
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Address for Notices:
c/o iSubscribed, Inc.
00 Xxxxxxx Xxxxx
Burlington, MA 01803
Signature Page to Equity Commitment Letter
Schedule I
Pro Rata Percentage
Equity Investor
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Pro Rata Percentage
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WndrCo Holdings, LLC
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64.83%
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General Catalyst Group IX, L.P.
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25.11%
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GC Entrepreneurs Fund IX, L.P.
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0.36%
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iSubscribed Inc.
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9.7%
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Total
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100%
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