EXHIBIT 10.41
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SECURITIES PURCHASE AGREEMENT
among
IXL HOLDINGS, INC.
and
THE INVESTORS NAMED HEREIN
15,384 Shares of Class B Convertible Preferred Stock,
and
Warrants to Purchase 1,775 Shares of Class B Convertible Preferred Stock
Dated as of December 23, 1997
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SECURITIES PURCHASE AGREEMENT
This SECURITIES PURCHASE AGREEMENT (the "Agreement") is dated as of
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December 23, 1997, and entered into by and among IXL Holdings, 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 shall have
the following meanings:
"Affiliate," as applied to any specified Person, shall mean
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any other 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
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
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
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examination by any Tax Authority, proceeding or appeal of such proceeding
relating to Taxes.
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"Board of Directors" means, as to any Person, the board of directors
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of such Person or any duly authorized committee thereof.
"Business Day" shall mean each day other than Saturdays, Sundays and
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days when commercial banks are required or authorized by law or executive order
to be closed for business in New York, New York.
"Capital Stock" means any and all shares, interests, participations
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or other equivalents (however designated) of corporate stock, including, without
limitation, all common stock and preferred stock.
"Certificate of Incorporation" has the meaning ascribed thereto in
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Section 2.1.
"Charter Documents" means the Articles of Organization, Articles of
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Incorporation or Certificate of Incorporation, Bylaws and any other
organizational document, as amended or restated (or both) to date, of the
Company, or any of its Subsidiaries, as applicable.
"Chase Investors" shall mean Chase Venture Capital Associates, L.P.,
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Flatiron Partners, LLC, and Greylock IX Limited Partnership.
"Class A Common Stock" has the meaning ascribed thereto in
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Section 4.2.
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"Class A Preferred Stock" has the meaning ascribed thereto in
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Section 4.2.
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"Class B Common Stock" has the meaning ascribed thereto in
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Section 4.2.
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"Class B Preferred Stock" has the meaning ascribed thereto in
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Section 2.1.
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"Class C Preferred Stock" has the meaning ascribed thereto in
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Section 4.2.
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"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 from time
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to time, and any successor statute or law thereto.
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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 4.9(a)(3).
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"Documents" means this Agreement, the Warrant Agreement, the
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Securities, the Registration Rights Agreements and the Stockholder 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
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Section 4.19.
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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 Federal, state, local and foreign laws
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and regulations relating to pollution or protection of human health or the
environment (including, without limitation, ambient air, surface water, ground
water, land surface or subsurface strata and natural resources), 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.
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"ERISA Affiliate" has the meaning ascribed thereto in Section 4.19.
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"Exchange Act" means the Securities Exchange Act of 1934, as amended,
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and the rules and regulations of the SEC thereunder, and any successor statute
or law thereto.
"GAAP" means those generally accepted accounting principles and
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practices which are recognized as such from time to time by the American
Institute of Certified Public Accountants acting through its Accounting
Principles Board or by the Financial Accounting Standards Board or through other
appropriate boards or committees thereof and which are consistently applied for
all periods after the date hereof.
"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.
"Inspectors" has the meaning ascribed thereto in Section 6.2.
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"Investors" means the investors signatory to this Agreement.
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"Xxxxx" means collectively Xxxxx Investment Associates V, L.P., a
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Delaware limited partnership, and Xxxxx Equity Partners V, L.P., a Delaware
limited partnership.
"Laws" has the meaning ascribed thereto in Section 4.9.
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"Lien" means any mortgage, pledge, lien, encumbrance, charge or
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adverse 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
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Company and its Subsidiaries, taken as a whole, or (b) a 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, 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 encumbrances
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.
"Preferred Shares" has the meaning ascribed thereto in Section 2.1.
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"Proceedings" has the meaning ascribed thereto in Section 4.15.
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"Property" or "property" means any assets or property of any kind or
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nature whatsoever, real, personal or mixed (including fixtures), whether
tangible or intangible, provided that the terms "Property" or "property," when
used with respect to any Person, shall not include securities issued by such
Person.
"OPO" shall mean a firm commitment public offering of the Company's
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Class B Common Stock by a major bracket underwriter resulting in net proceeds to
the Company of $30,000,000 or more and at a price per share of Class B Common
Stock (as constituted as of December 17, 1997) of $700 or higher.
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"Registration Rights Agreement" has the meaning ascribed thereto in
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Section 2.1.
"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
Person that is (x) an Affiliate of an Investor, (y) an Affiliate of the general
partner(s), investment manager(s) or investment advisor(s) of an Investor or (z)
an investment fund, investment account or investment entity whose investment
manager, investment advisor or general partner thereof is an Investor or an
Affiliate of an Investor.
"Rule 144A" means Rule 144A as promulgated by the SEC under the
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Securities Act, as amended from time to time, and any successor rule or
regulation thereto.
"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
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Section 2.1.
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"Stockholders Agreement" has the meaning ascribed thereto in
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Section 2.1.
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"Subsidiary" of any person means (a) a corporation in which such
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Person, a 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 majority ownership interest or (ii) the power, under ordinary
circumstances, to elect, or to 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 Person, or such Person and one or more subsidiaries of such
Person (i) is, at the date of determination, a general partner of such
partnership, or (ii) has 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 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 power to elect, or to direct the election of, a
majority of the directors or other governing body of such Person.
"Taxes" shall mean all Federal, state, local and foreign taxes, and
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other assessments of a similar nature (whether imposed directly or through
withholding), including any interest, additions to tax, or penalties applicable
thereto.
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"Tax Authority" means the Internal Revenue Service and any other
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domestic 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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"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 for the election of
directors, managers, trustees or general partners by reason of the happening of
any contingency).
"Warrant Agreement" means the Warrant Agreement, to be dated as of the
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Closing Date, by and among the Company and the Investors, in the form attached
hereto as Exhibit B.
"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 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
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(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 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 15,384 shares of Class B Convertible
Preferred Stock, par value $.01 (the "Class B Preferred Stock"), having the
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rights set forth in the Amended and Restated Certificate of Designation of the
Company and the Amended and Restated Certificate of Incorporation of the Company
in the form attached as Exhibit A (collectively, the "Certificate of
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Incorporation"), to be issued to the Investors, and (ii) warrants (the
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"Warrants") to purchase, an aggregate of 1,775 shares of Class B Preferred
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Stock, subject to adjustment as set forth in the Warrant Agreement. The shares
of Class B Preferred Stock issued on the Closing Date pursuant to this Agreement
(the "Preferred Shares") and the Warrants are referred to herein as a "Security"
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and collectively as the "Securities" and the shares of Class B Preferred Stock
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issuable upon exercise of the Warrants are referred to herein as the "Warrant
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Shares." Each Holder of Securities will have certain registration rights with
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respect to the Class B Common Stock, $.0l par value of the Company, underlying
the Preferred Shares and the Warrant Shares as set forth in the Registration
Rights Agreement dated as of April 30, 1996, as amended, by and among the
Company, Xxxxx, the Chase Investors and each of the other Persons listed on the
signature pages thereto, a copy of which is attached hereto as Exhibit C (the
"Registration Rights Agreement"). Each Investor shall also become a party to the
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Second Amended and Restated Stockholder Agreement, to be dated as of the Closing
Date, by and among the Company, Xxxxx, the Chase Investors and the other Persons
who are parties thereto, a copy of which is attached hereto as Exhibit D (the
"Stockholders 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 and the Warrants, for a number of Warrant Shares as provided in the
Warrant Agreement and the Warrants. 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.
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Section 2.2 Purchase and Sale of Securities
(a) Purchase and Sale. 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, the Securities
indicated on Schedule 1 attached hereto for an aggregate purchase price of
$4,999,800 for all of the Securities.
(b) Closing. The purchase and sale of the Securities shall take place
at a closing (the "Closing") at the offices of Debevoise & Xxxxxxxx, 375 Third
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Xxxxxx, Xxx Xxxx, Xxx Xxxx, 00000, at 10:00 a.m., New York time, on the date
hereof, or at such other place and/or on such other Business Day as may be
agreed upon by the Investors and the Company (the "Closing Date"). At the
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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
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, the Warrant
Agreement, the Stockholder Agreement, the Registration Rights
Agreements and the other Documents including, without 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 and reasonable
fees and other charges and expenses of Investor's consultants,
provided such fees and expenses of Investor's consultants have
been approved by the Company in advance;
(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
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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 Investors 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
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reasonable fees and 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. Each Investor's obligations hereunder are subject
to the execution and delivery of this Agreement by the other Investors
listed on the signature pages hereof. The obligations of each Investor
shall be several 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 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 Preferred 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.
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ARTICLE III
CLOSING CONDITIONS
Section 3.1 Conditions to Obligations of the Investors
The obligations 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 of each of the following conditions on or before the
Closing Date:
(a) Delivery of Documents. The Company shall have delivered to each
Investor, in form and substance satisfactory to such Investor, the following:
(i) The Preferred 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, PC, counsel for the Company, as to the
matters set forth in Exhibit E.
(iii) Resolutions of the Board of Directors of the Company, certified
by the Secretary of the Company to be duly adopted and in full force and
effect on such date, 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 Preferred Shares and
Warrants pursuant to this Agreement.
(iv) 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.
(v) Certificate of the Secretary of the Company dated the Closing
Date certifying (A) a copy of the bylaws of the Company, (B) resolutions of
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
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party and the consummation of the transactions contemplated hereby and
thereby, including the issuance of the Preferred Shares and Warrants
pursuant to this Agreement, (C) written consent resolutions of the
stockholders of the Company authorizing the execution and filing of the
Certificate of Incorporation, (D) the notice delivered to nonconsenting
stockholders of the Company regarding such written consent resolutions of
the stockholders of the Company, and (E) as to the incumbency and
genuineness of the signatures of the officers of the Company.
(vi) Such additional information and materials as any Investor may
reasonably request.
(b) Compliance with Agreements. The Company shall have performed
and complied with all agreements, covenants and conditions contained 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 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, Xxxxx and each Investor shall have executed and
delivered an Agreement to be Bound to the Registration Rights Agreements.
(iii) The Company, Xxxxx and each Investor shall have executed and
delivered an Agreement to be Bound to the Stockholder Agreement.
(iv) All of the other Investors listed in the signature pages hereof
shall have consummated their purchase of Securities pursuant to this
Agreement.
(v) The Company and the Investors shall have executed and delivered
the Warrant Award Agreement in substantially the form of Exhibit F hereto.
(d) Representations and Warranties. All of the representations and
warranties of the Company contained herein shall be true and correct in all
material respects on and as of the Closing Date, both before and after giving
effect to the transactions contemplated hereby and by the other Documents.
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(e) Proceedings Satisfactory. All proceedings taken in connection
with 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, 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, except for any such consents, approvals or
authorizations the failure of which to obtain would not reasonably be expected
to have a Material Adverse Effect.
(g) No Material Adverse Change. There shall not have been any
material adverse change in the properties, business, operations, assets,
prospects, condition (financial or otherwise) of the Company and its
Subsidiaries.
(h) No Material Judgment or Order. There shall not be on the
Closing Date any judgment or order of a court of competent jurisdiction or any
ruling of any agency of the Federal, state or local government 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 to any material
penalty if the Securities were to be issued and sold hereunder.
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 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:
(1) all of the other Investors listed in the signature pages hereof
shall have consummated their purchase of Securities pursuant to this Agreement;
and
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(2) each of the Investors shall have executed and delivered the
Agreement to be Bound to the Stockholder Agreement.
(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 on and as of the Closing Date, both before
and after giving effect to the transactions contemplated hereby and by the other
Documents.
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:
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 authorized capital stock of the Company consists of (a)
50,000,000 shares of Class A Common Stock, par value S.01 per share (the "Class
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A Common Stock"), (b) 100,000,000 shares of Class B Common Stock, par value $.0l
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per share (the "Class B Common Stock"), (c) 500,000 shares of blank check
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preferred stock, 250,000 shares of which have been designated as Class A
Convertible Preferred Stock, par value $.0l per share (the "Class A Preferred
Stock"), 100,000 shares of which have been designated as Class B Preferred
Stock, and 15,000 shares of which have been designated as Class C Convertible
Preferred Stock, par value $.0l per share (the "Class C Preferred Stock"). As of
the Closing Date, after giving effect to the transactions contemplated by this
Agreement and the other Documents, (i) there will be issued and outstanding (A)
no shares of Class A Common Stock, (B) 82,298 shares of Class B Common Stock,
all of which will be validly issued and fully paid and nonassessable, (C)
169,260 shares of Class A Preferred Stock, all of which will be validly issued
and fully paid and nonassessable, (D) 83,075 shares of Class B Preferred Stock,
all of which will be validly issued and fully paid and
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nonassessable, and (E) 9,232 shares of Class C Preferred Stock, all of which
will be validly issued and fully paid and nonassessable; (ii) there will be
reserved for issuance (A) 365,000 shares of Class A Common Stock to be issued
upon conversion of the Class A Preferred Stock, the Class B Preferred Stock and
the Class C Preferred Stock, (B) 58,201 shares of Class B Common Stock to be
issued upon the exercise of outstanding options and warrants (other than the
Warrants); (C) 94,108 shares of Class B Common Stock to be issued upon the
exercise of unissued options pursuant to the Company's 1996 Stock Option Plan,
as amended, (D) 10,650 shares of Class B Preferred Stock to be issued upon
exercise of the Warrants and (E) 365,000 shares of Class B Common Stock to be
issued upon conversion of the Class A Common Stock. Except as set forth above
and on Schedule 4.2 hereto, at the Closing Date, after giving effect to the
transactions contemplated by this Agreement and the other Documents, no Equity
Interests of the Company will be issued or outstanding and there are not, and at
the Closing Date there will not be, any 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 with all federal and state securities
laws in connection with the issuance of all outstanding Equity Interests, except
where such failure would not have a Material Adverse Effect.
(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. 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.
15
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 has 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 Preferred Shares
The issuance and sale of the Preferred Shares has been duly authorized
and the Preferred Shares when issued to the Investors for the consideration set
forth herein will be fully paid and non-assessable, 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 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 Class B Preferred 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 validly issued and fully paid and nonassessable, with
no personal liability attached to the ownership thereof.
16
Section 4.7 Authorization, Etc. of Registration Rights Agreement
The Registration Rights Agreement has been duly authorized, validly
executed and delivered by the Company and constitutes the legal, valid and
binding agreement of the Company, enforceable against the Company in accordance
with its terms, except (a) 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) and (b) rights to indemnification thereunder
may be limited by Federal or state securities laws or the policies underlying
such laws.
Section 4.8 Authorization, Etc. of Stockholder Agreement
The Stockholder Agreement has been duly authorized and, validly
executed and delivered by the Company, Xxxxx and the required stockholders of
the Company and constitutes 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).
Section 4.9 No Violation or Conflict; No Default
(a) Neither the nature of the business of the Company or any of its
Subsidiaries, the execution, delivery or performance of this Agreement, the
Securities, the Registration Rights Agreement, the Warrant Agreement, the
Stockholder Agreement or any of the other Documents by the 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, except where such violation would not
reasonably be expected to have, singly or in the aggregate, a Material
Adverse Effect; or
17
(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 Company is not in default (without giving effect to any
grace or cure period or notice requirement) under any Contract, any of the
Charter Documents, or any applicable judgments or orders, except where such
default would not, individually or in the aggregate reasonably be expected to
have a Material Adverse Effect.
(c) 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) required filings under the Securities Act or state "blue
sky" laws as a result of the exercise of rights under the Registration Rights
Agreement, and (ii) where the failure to obtain such consents, approvals,
authorizations or permits or to make such filings or notifications, would not,
individually or in the aggregate, reasonably be expected to have a Material
Adverse Effect or prevent or delay in any material respect consummation of the
Transactions, or otherwise prevent the Company from performing their obligations
under this Agreement or the other Documents.
Section 4.10 Use of Proceeds
The proceeds from the sale of the Securities will be used for general
corporate purposes.
18
Section 4.11 No Material Adverse Change; Financial Statements
(a) Except as set forth on Schedule 4.11 hereto, subsequent to
October 31, 1997, 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 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 stockholder or any agreement or
commitment therefor, other than travel expense advances made by the Corporation
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 Investors with a true
and complete copy of (i) the audited financial statements of iXL Interactive
Excellence, Inc. (n/k/a iXL, Inc.) for the years ended December 31, 1993, 1994
and 1995, and for the four-month period ending 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. for the years
ending December 31, 1993, 1994 and 1995, and for the four-month period ending
April 30, 1996; (iii) the audited consolidated financial statements for the
Company and its Subsidiaries for the eight months ended December 31, 1996; and
(iv) the unaudited consolidated financial statements for the Company and its
Subsidiaries, dated October 31, 1997. Such financial statements present fairly
in all material respects the consolidated financial position, results of
operations, shareholders' equity and cash flows 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, in the
case of the unaudited financial statements, for the exclusion of footnotes and
normal year end adjustments). Except as set forth on Schedule 4.11, since
October 31, 1997, 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 unaudited balance sheet of the Company at October 31, 1997, (b)
which were incurred in the ordinary course of business after October 31,
19
1997 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, 1996, there has been no change in any significant accounting (including tax
accounting) policies, practices or procedures of the Company or its
Subsidiaries. All 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) 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 4.11, 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 4.12 Full Disclosure
Neither this Agreement, the financial statements referred to in
Section 4.11 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 4.13 Private Offering
Assuming the correctness of the representations and warranties set
forth in Sections 5.1 and 5.2 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. In the case of each offer or sale of the
Securities, no form of general solicitation or general advertising was used by
the Company and its representatives, 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 4.14 No Brokers
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.
20
Section 4.15 Litigation
(a) Except as set forth on Schedule 4.15, there is no action
(including, without limitation, an investigation or partial proceeding, such as
a deposition), whether commenced, or to the knowledge of the Company, threatened
("Proceedings") 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 contemplated hereby or thereby.
(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 Governmental Body that has had a Material Adverse Effect or
that would reasonably be expected to have, singly or in the aggregate, a
Material Adverse Effect.
Section 4.16 Labor Relations
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 (a) 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, (b) 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 (c) 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 activities 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.
Except as disclosed on Schedule 4.16 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 applicable Federal, state, provincial or
foreign law relating to employment or employment
21
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. 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 Federal
and state laws and regulations prohibiting discrimination in the workplace
including, without limitation, laws and regulations that prohibit discrimination
and/or harassment on account of race, national origin, religion, gender,
disability, age, immigration status, workers compensation status or otherwise.
Section 4.17 Taxes
Except as otherwise disclosed in Schedule 4.17:
(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
applicable law to be filed by any of it prior to or as of the Closing Date. 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.
22
(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 4.18 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.
(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 4.18(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
23
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 4.19 ERISA
Except as set forth on Schedule 4.19, 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").
------------
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 Federal, state and other applicable
laws, rules and regulations, 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, singly 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
24
Employee Benefit Plan will, in connection with the transactions contemplated
under this Agreement, the other Documents, fail for any reason to be deductible
for Federal income tax purposes.
Section 4.20 Intellectual Property
Each of the Company and its Subsidiaries owns or possesses adequate
licenses or other rights to use all material intellectual property, including
but not limited to trademarks, service marks, trade names, copyrights, computer
software, and know-how, necessary to conduct 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,
including but not limited to trademarks, service marks, trade names, copyrights,
computer software or know-how which would reasonably be expected to result in
any Material Adverse Effect. To the knowledge of the Company, all intellectual
property material to its business as currently conducted and as proposed to be
conducted is 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 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
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, 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 of the Company or its Subsidiaries. Schedule 4.20 hereto
lists all material intellectual property owned or licensed by the Company or its
Subsidiaries. For the purposes of Schedule 4.20, "material intellectual
property" shall not include any retail shrink-wrap software licensed by the
Company.
Section 4.21 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 Laws relating to its business, the
absence of which would reasonably be expected to have, singly 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
25
Company or its Subsidiaries under any Laws, other than any such Proceedings
which, if adversely determined, would not reasonably be expected to have, singly
or in the aggregate, a Material Adverse Effect.
Section 4.22 Agreements
Except as set forth on Schedule 4.22 hereto, the Corporation is not a
party to any written or oral (a) Contract with any labor union; (b) 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; (d)
agreement or indenture relating to the borrowing of money or to the mortgaging,
pledging or otherwise placing a Lien on any assets of the Company; (e) guaranty
of any 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 $100,000; (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 contemplated herein; or (j) any other Contract, agreement,
arrangement or understanding which is material to the business of the Company.
All such Contracts constitute the valid and binding obligations of the Company
and, to the best knowledge of the Company, the other parties thereto,
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 4.22, "material" shall mean any Contract involving more than
$100,000.00.
Section 4.23 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 (through the year 1999), the year 2000 and the twenty-first century,
including leap year calculations.
26
ARTICLE V
REPRESENTATIONS AND WARRANTIES OF EACH INVESTOR
Each Investor (as to itself only) represents and warrants to the
Company that:
Section 5.1 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.
Section 5.2 Accredited Investor
Such Investor is knowledgeable, sophisticated and experienced in
business and financial matters and in investing in privately held 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.
Section 5.3 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
27
of any of the remedies, covenants or other provisions thereof and upon the
availability of injunctive relief or other equitable remedies.
Section 5.4 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;
(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.
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ARTICLE VI
COVENANTS
The Company covenants to the Holders of outstanding Securities as
follows:
Section 6.1 Compliance with Laws; Maintenance of Licenses
The Company shall, and shall cause each of its Subsidiaries to, comply
with all statutes, ordinances, governmental rules and regulations, judgments,
orders and decrees (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 a QPO, the Company agrees to allow, and to cause
each of its Subsidiaries to allow, each Investor or subsequent Holder who
continues to hold Preferred 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
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visit and inspect any of the properties of the Company or any of its
Subsidiaries, (ii) to examine all their books of account, records, reports and
other papers and to make copies and extracts therefrom, (iii) to discuss its
affairs, finances and accounts with its officers and employees, and (iv) to
discuss the financial condition of the Company and its Subsidiaries with their
independent accountants upon reasonable notice to the Company of its intention
to do so and so long as the Company shall 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 Information to Prospective Investors
Until the closing of a QPO, the Company shall, upon the request of any
Investor or subsequent Holder, deliver to such Investor or such Holder and any
prospective purchaser designated by such Investor or such Holder promptly
following the request of such Investor or such Holder or such prospective
purchaser such information which such Investor or such Holder or such
prospective purchaser may reasonably request in order to comply with the
information requirements of Rule 144A.
29
Section 6.4 Financial Statements
Until the closing of a QPO, the Company will deliver to each Investor or
subsequent Holder who continues to hold Preferred Shares with an original cost
of at least $1,000,000:
(a) Beginning with January 1998, 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 generally accepted accounting
principles consistently applied except for the absence of footnotes and subject
to changes resulting from periodic adjustments;
(b) 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 Price
Waterhouse 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 generally
accepted accounting principles consistently applied and present fairly in all
material respects the consolidated financial condition of the Company as of the
dates indicated; and
(c) Not later than January 15, 1998, monthly and annual management
projections and budgets for fiscal year 1998, and not later than 30 days prior
to the start of each fiscal year beginning with the fiscal year beginning
January 1, 1999, monthly and annual management projections and budgets for such
fiscal year.
Section 6.5 Employee Agreements
The Company will use its commercially reasonable best efforts to cause its
key employees to enter into confidentiality/non-competition/no-hire agreements
within six months of the Closing Date, in a form reasonably acceptable to the
Company and the Investors.
30
Section 6.6 Key Man Insurance
The Company will use its commercially reasonable best efforts to purchase
within six months of the Closing Date a life insurance policy on the life of U.
Xxxxxxx Xxxxx, Xx. in the principal amount of $5 million the proceeds of which
shall be paid to the Company.
Section 6.7 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 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 payable by the Company with respect to the transactions contemplated
hereunder.
Section 6.8 Securities Act Registration Statements
Except for securities of the Company registered on Form S-4 or Form S-8
promulgated under the Securities Act or any successor forms thereto, the Company
shall not file any registration statement under the Securities Act covering any
securities unless it shall first have given the Investors written notice
thereof. In connection with any registration statement referred to in this
Section 7.4, the Company will indemnify, to the extent permitted by law, each
Investor, its partners, officers and directors and each person, if any, who
controls such Investor within the meaning of Section 15 of the Securities Act,
against all losses, claims, damages, liabilities and expenses caused by any
untrue statement or alleged untrue statement of a material fact contained in any
registration statement or prospectus or any preliminary prospectus or any
amendment thereof or supplement thereto or caused by any omission or alleged
omission to state therein a material fact required to be stated therein or
necessary to make the statements therein not misleading, except insofar as such
losses, claims, damages, liabilities or expenses are caused by any untrue
statement or alleged untrue statement or omission or alleged omission contained
in written information furnished to the Company by such Investor for use in such
registration statement. If, in connection with any such registration statement,
an Investor shall furnish written information to the Company for use in the
registration statement, such Investor will indemnify, to the extent permitted by
law, the Company, its directors, each of its officers who sign such registration
statement and each person, if any, who controls the Company within the meaning
of the Securities Act against all losses, claims, damages, liabilities and
expenses caused by any untrue statement or alleged untrue statement of a
material fact or any omission or alleged omission of a material fact required to
be stated in the registration statement or prospectus or any preliminary
prospectus or any amendment thereof or supplement thereto or necessary to make
the statements therein not misleading, but only to the extent that such
31
untrue statement or alleged untrue statement or such omission or alleged
omission is contained in information so furnished in writing by such Investor
for use therein.
Section 6.9 Publicity; Press Releases.
The Company shall not issue any press release or make any public disclosure
regarding the Investors' investment in the Company contemplated hereby unless
such press release or public disclosure is approved by the Investors in advance.
Section 6.10 Observation Rights.
So long as the Investors continue to hold at least 50% of the Class B
Preferred Stock purchased in connection herewith, the Investors shall have the
right to have a representative attend any meetings of the Board of Directors
(including any adjournments thereof) either in person or by such other method as
shall be allowed under the Bylaws for Directors, and shall further have the
right to receive any notices and materials provided to the entire Board of
Directors in their capacity as such. Such representative shall have the right to
speak at such meetings and to make such suggestions and requests during such
meetings as such representative deems appropriate, and the Board of Directors
shall consider such suggestions and requests in good faith.
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
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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.
32
To the Company:
IXL Holdings, Inc.
Two Park Place
0000 Xxxxx Xxxxxx, 0xx Xxxxx
Xxxxxxx, Xxxxxxx, 00000
Attention: U. Xxxxxxx Xxxxx, Xx.
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, Inc.
000 Xxxx Xxxxxx
00xx Xxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attn: Xxxxx X. Xxxxxxx XX, 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:
Paul, Hastings, Xxxxxxxx & Xxxxxx LLP
000 Xxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attn: Xxxxxxx Xxxxxxxxx, Esq.
Telecopy No.: (000) 000-0000
33
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 Person 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 to which any such amendment pertains.
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.
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.
34
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 REALTING
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.
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
35
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 Survival of Representations, Warranties and Agreements; No
Recourse.
The representations, warranties and agreements in this Agreement shall
survive the Closing until June 30, 1998, except that the agreements contained in
Article VI and VII shall survive the Closing indefinitely (except to the extent
a shorter period of time is explicitly specified therein). 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.
Section 7.11 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 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,
36
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. Prior to the filing of any registration statement for the public sale
of Capital Stock of the Company, the Company shall cooperate with each Holder in
providing due diligence disclosures to any such prospective purchaser.
[Signature pages follow]
37
IN WITNESS WHEREOF, this Agreement has been duly executed by the
parties set forth below as of the date first written above.
IXL HOLDINGS, INC.
By: /s/ Xxxxx X. Xxxxxx
----------------------------------
Title: Executive Vice President
Address:
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GENERAL ELECTRIC CAPITAL CORPORATION
000 Xxxx Xxxxx Xxxx By: /s/ Xxxx X. Xxxxxxx
Xxxxxxxx, XX 00000 ----------------------------------
Title: Dept. Operations Manager
38
EXHIBITS
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Exhibit A Amended and Restated Certificate of Incorporation
Exhibit B Form of Warrant Agreement
Exhibit C Registration Rights Agreement
Exhibit D Stockholders' Agreement
Exhibit E Form of Opinion of Xxxxxx & Xxxxxx, PC
Exhibit F Form of Warrant Award Agreement
SCHEDULES
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Schedule 1.1 Permitted Liens
Schedule 4.2 Capitalization
Schedule 4.3 Subsidiaries
Schedule 4.11 Material Adverse Changes; Title to Property
Schedule 4.15 Litigation
Schedule 4.16 Violations re Labor Relations
Schedule 4.17 Taxes
Schedule 4.18(d) Governmental Authorizations Required under Environmental Law
Schedule 4.19 ERISA
Schedule 4.20 Intellectual Property
Schedule 4.22 Agreements
39
SCHEDULE 1
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Name of Investor Securities Purchased
---------------- --------------------
--------------------------------------------------------------------------------
General Electric Capital Corporation 15,384 shares of Class B Preferred Stock
1,775 Warrants
