EXHIBIT 6
BROADVIEW
March 15, 1999
CONFIDENTIAL
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Board of Directors
Go2Net, Inc.
000 0xx Xxxxxx
Xxxxx 0000
Xxxxxxx, XX 00000
Dear Members of the Board:
We understand that Go2Net, Inc. ("Go2Net" or the "Company") and Vulcan
Ventures Inc. ("Vulcan") propose to enter into a Stock Purchase Agreement (the
"Agreement") pursuant to which Go2Net agrees to issue and sell to Vulcan
300,000 shares of Go2Net's Series A Preferred Stock ("Preferred Shares") for a
purchase price of $1,000 per share (the "Stock Purchase"), payable in cash and
a short-term promissory note. Vulcan shall have the right, at its option, at
any time, to convert, subject to the terms of the Certificate of Designation
of Series A Convertible Preferred Stock (the "Certificate") all or any portion
of its Preferred Shares into that number of shares of Go2Net common stock
equal to (i) the sum of (A) the purchase price of all Preferred Shares to be
converted plus (B) any declared but unpaid dividends on such shares, divided
by (ii) $66.11 (the "Conversion Price"), subject to adjustment according to
the Certificate. The issuance and sale of 132,493 of the Preferred Shares
pursuant to the Stock Purchase (the "Second Issuance") is conditioned upon,
among other things (i) Vulcan's purchase of all common shares tendered (the
"Tender Offer") up to 3,574,278 shares of Go2Net's Common Stock at a purchase
price of $90.00 per share (the "Tender Price") in cash, and (ii) the election
of a number of candidates designated by Xxxxxx that would constitute a
majority of the directors of Go2Net's Board. In addition, Go2Net management
has agreed to sell 1,425,722 shares of Go2Net common stock to Vulcan for
$90.00 per share. The terms and conditions of the Stock Purchase and Tender
Offer (together, the "Transaction") are more fully described in the Agreement.
You have requested our opinion as to whether the Conversion Price and Tender
Price are fair, from a financial point of view, to Go2Net shareholders.
Broadview International LLC focuses on providing merger and acquisition
advisory services to information technology ("IT"), communications and media
companies. In this capacity, we are continually engaged in valuing such
businesses, and we maintain an extensive database of IT, communications and
media mergers and acquisitions for comparative purposes. We will receive a fee
from Go2Net upon the delivery of this opinion.
In rendering our opinion, we have, among other things:
1.) reviewed the terms of the Agreement, the Certificate and the Stock
Purchase and Voting Agreement in the form of drafts dated March 14,
1999 furnished to us by Go2Net's legal counsel on March 14, 1999,
which, for the purposes of this opinion, we have assumed, with your
permission, to be identical in all material respects to the agreements
and certificate to be executed, except that we have been informed by
Go2Net management that the agreements to be executed will provide for:
(a) the sale of 300,000 Preferred Shares with 167,507 sold at the First
Closing (as defined in the Agreement), and 132,493 being sold at
the Second Closing (as defined in the Agreement);
(b) a Conversion Price of $66.11 per share;
(c) a Maximum Tender Number (as defined in the Agreement) of 3,574,278
and a Tender Price of $90.00 per share;
(d) the sale of 1,425,722 shares of Go2Net common stock by Go2Net
management to Vulcan for $90.00 per share; and
(e) payment of $8 million of transaction fees by Go2Net pursuant to
Section 10.3 of the Agreement;
2.) reviewed Go2Net's Form 10-K for its fiscal year ended September 30,
1998, including the audited financial statements included therein, and
Go2Net's Form 10-Q for the three months ended December 31, 1998,
including the unaudited financial statements included therein;
3.) reviewed quarterly financial projections for Go2Net for its fiscal
years ending September 30, 1999 through September 30, 2001 prepared and
provided to us by Go2Net management;
4.) participated in discussions with Go2Net management concerning the
operations, business strategy, financial performance and prospects for
Go2Net;
5.) discussed with Go2Net management its view of the strategic rationale
for the Transaction;
6.) discussed with Vulcan management its view of the strategic rationale
for the Transaction;
7.) reviewed recent equity analyst reports covering Go2Net;
8.) reviewed the reported closing prices and trading activity for Go2Net
Common Stock;
9.) compared certain aspects of the financial performance of Go2Net with
public companies we deemed comparable;
10.) considered the implications on the Company's capital structure
resulting from the Transaction, including the accelerated vesting of
existing options to purchase Go2Net common stock;
11.) analyzed available information, both public and private, concerning
other mergers and acquisitions we believe to be comparable in whole or
in part to the Transaction;
12.) conducted other financial studies, analyses and investigations as we
deemed appropriate for purposes of this opinion.
In rendering our opinion, we have relied, without independent verification,
on the accuracy and completeness of all the financial and other information
(including without limitation the representations and warranties contained in
the Agreement) that was publicly available or furnished to us by Go2Net. With
respect to the financial projections examined by us, we have assumed that they
were reasonably prepared and reflected the best available estimates and good
faith judgments of the management of Go2Net as to the future performance of
Go2Net. We have neither made nor obtained an independent appraisal or
valuation of any of Go2Net's assets.
Based upon and subject to the foregoing, we are of the opinion that the
Conversion Price and Tender Price are fair, from a financial point of view, to
Go2Net shareholders.
For purposes of this opinion, we have assumed that Go2Net is not currently
involved in any material transaction other than the Transaction and those
activities undertaken in the ordinary course of conducting its business. Our
opinion is necessarily based upon market, economic, financial and other
conditions as they exist and can be evaluated as of the date of this opinion,
and any change in such conditions may impact this opinion. We express no
opinion as to the price at which Go2Net Common Stock will trade at any time.
This opinion speaks only as of the date hereof. It is understood that this
opinion is for the information of the Board of Directors of Go2Net in
connection with its consideration of the Transaction and does not constitute a
recommendation to any Go2Net shareholder as to how such shareholder should
vote on the Second Issuance or as to whether such shareholder should tender
pursuant to the Tender Offer. This opinion may not be published or referred
to, in whole or part, without our prior written permission, which shall not be
unreasonably withheld. Broadview International LLC hereby consents to
references to and the inclusion of this opinion in its entirety in the Proxy
Statement and Schedule 14D-9 to be distributed to Go2Net shareholders in
connection with the Transaction.
Sincerely,
/s/ Broadview International LLC
Broadview International LLC
