Exhibit 1.2
INTERNET CAPITAL GROUP, INC.
(A Delaware corporation)
Shares of Common Stock
INTERNATIONAL PURCHASE AGREEMENT
--------------------------------
Dated: , 1999
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TABLE OF CONTENTS
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INTERNATIONAL PURCHASE AGREEMENT
SECTION 1. Representations and Warranties......................................4
(a) Representations and Warranties by the Company...................4
(i) Compliance with Registration Requirements.........4
(ii) Independent Accountants...........................5
(iii) Financial Statements..............................5
(iv) No Material Adverse Change in Business............6
(v) Good Standing of the Company......................6
(vi) Good Standing of Subsidiaries and Material
Holdings..........................................7
(vii) Capitalization....................................7
(viii) Authorization of Agreements.......................8
(ix) Authorization and Description of Securities and
Convertible Notes.................................8
(x) Absence of Defaults and Conflicts.................8
(xi) Absence of Labor Dispute..........................9
(xii) Absence of Proceedings............................9
(xiii) Accuracy of Exhibits.............................10
(xiv) Possession of Intellectual Property..............10
(xv) Absence of Further Requirements..................10
(xvi) Possession of Licenses and Permits...............11
(xvii) Title to Property................................11
(xviii)Investment Company Act ..........................11
(xix) Environmental Laws...............................12
(xx) Registration Rights..............................12
(xxi) Year 2000. ......................................12
SECTION 2. Sale and Delivery to International Managers; Closing...............13
(a) Initial Securities.............................................13
(b) Option Securities..............................................13
(c) Payment........................................................14
(d) Denominations; Registration....................................14
SECTION 3. Covenants of the Company...........................................15
(a) Compliance with Securities Regulations and Commission
Requests. .....................................................15
(b) Filing of Amendments...........................................15
(c) Delivery of Registration Statements............................16
(d) Delivery of Prospectuses.......................................16
(e) Continued Compliance with Securities Laws......................16
(f) Blue Sky Qualifications........................................17
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(g) Rule 158.......................................................17
(h) Use of Proceeds................................................17
(i) Listing........................................................17
(j) Restriction on Sale of Securities..............................17
(k) Reporting Requirements.........................................18
(l) Compliance with Rule 463.......................................18
SECTION 4. Payment of Expenses................................................18
(a) Expenses.......................................................18
(b) Termination of Agreement.......................................19
SECTION 5. Conditions of International Managers' Obligations..................19
(a) Effectiveness of Registration Statement........................19
(b) Opinions of Counsel for Company................................19
(c) Opinion of Counsel for International Managers..................20
(d) Officers' Certificate..........................................20
(e) Accountant's Comfort Letters...................................20
(f) Bring-down Comfort Letter......................................21
(g) No Objection...................................................21
(h) Lock-up Agreements.............................................21
(i) Purchase of Initial International Securities...................21
(j) Conditions to Purchase of International Option Securities......21
(i) Officers' Certificate............................21
(ii) Opinion of Counsel for Company...................21
(iii) Opinion of Special 1940 Act Counsel..............22
(iv) Opinion of Counsel for International Managers....22
(v) Bring-down Comfort Letter........................22
SECTION 6. Indemnification....................................................23
(a) Indemnification of International Managers......................23
(b) Indemnification of Company, Directors and Officers.............24
(c) Actions against Parties; Notification..........................24
(d) Settlement without Consent if Failure to Reimburse.............25
SECTION 7. Contribution.......................................................25
SECTION 8. Representations, Warranties and Agreements to Survive
Delivery..............................................................27
SECTION 9. Termination of Agreement...........................................27
(a) Termination; General...........................................27
(b) Liabilities....................................................27
SECTION 10. Default by One or More of the International Managers..............28
SECTION 11. Notices...........................................................28
SECTION 12. Parties...........................................................29
SECTION 13. GOVERNING LAW AND TIME............................................29
SECTION 14. Effect of Headings................................................29
ii
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SCHEDULE A ............................................................. Sch A-1
SCHEDULE B ............................................................. Sch B-1
SCHEDULE C ............................................................. Sch C-1
Exhibit A .............................................................. Ex. A-1
Exhibit B .............................................................. Ex. B-1
Exhibit C .............................................................. Ex. C-1
iii
INTERNET CAPITAL GROUP, INC.
(A Delaware corporation)
Shares of Common Stock
(Par Value $.001 Per Share)
INTERNATIONAL PURCHASE AGREEMENT
--------------------------------
, 1999
▇▇▇▇▇▇▇ ▇▇▇▇▇ INTERNATIONAL
▇▇▇▇▇▇▇ ▇▇▇▇▇ International
▇▇▇▇▇▇▇ Sachs International
Deutsche Bank AG London
▇▇▇▇▇▇ Brothers International (Europe)
BancBoston ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇ International Limited
as Lead Managers of the several International Managers
c/o Merrill ▇▇▇▇▇ International
▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇-▇▇▇▇
Ladies and Gentlemen:
Internet Capital Group, Inc., a Delaware corporation (the "Company"),
confirms its agreement with ▇▇▇▇▇▇▇ ▇▇▇▇▇ International ("▇▇▇▇▇▇▇ ▇▇▇▇▇") and
each of the other International Managers named in Schedule A hereto
(collectively, the "International Managers," which term shall also include any
underwriter substituted as hereinafter provided in Section 10 hereof), for whom
▇▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇ International, Deutsche Bank AG London, ▇▇▇▇▇▇
Brothers International (Europe) and BancBoston ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇ International
Limited are acting as representatives (in such capacity, the "Lead Managers"),
with respect to the issue and sale by the Company and the purchase by the
International Managers, acting severally and not jointly, of the respective
numbers of shares of Common Stock, par value $.001 per share, of the Company
("Common Stock") set forth in said Schedule A, and with respect to the grant by
the Company to the International Managers, acting severally and not jointly, of
the option described in Section 2(b) hereof to purchase all or any part of
additional shares of Common Stock to cover over-allotments, if any. The shares
of Common Stock (the "Initial International Securities") to be purchased by the
International Managers and all or any part of the shares of Common Stock
subject to the option described in Section 2(b) hereof (the "International
Option Securities") are hereinafter collectively called the "International
Securities."
It is understood that the Company is concurrently entering into an
agreement dated the date hereof (the "U.S. Purchase Agreement") providing for
the offering by the Company of an aggregate of shares of Common Stock (the
"Initial U.S. Securities") through arrangements with certain underwriters
outside the United States and Canada (the "U.S. Underwriters") for which ▇▇▇▇▇▇▇
Lynch, Pierce, ▇▇▇▇▇▇ & ▇▇▇▇▇ Incorporated, ▇▇▇▇▇▇▇ Sachs & Co., Deutsche Bank
Securities Inc., ▇▇▇▇▇▇ Brothers Inc. and BancBoston ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇ Inc. are
acting as representatives (the "U.S. Representatives") and the grant by the
Company to the U.S. Underwriters, acting severally and not jointly, of an option
to purchase all or any part of the U.S. Underwriters' pro rata portion of up to
additional shares of Common Stock solely to cover overallotments, if any (the
"U.S. Option Securities" and, together with the International Option Securities,
the "Option Securities"). The Initial U.S. Securities and the U.S. Option
Securities are hereinafter collectively called the "U.S. Securities." It is
understood and agreed that the Company is not obligated to sell and the
International Managers are not obligated to purchase, any Initial International
Securities unless all of the Initial U.S. Securities are contemporaneously
purchased by the U.S. Underwriters. The U.S. Underwriters and the International
Managers are hereinafter collectively called the "Underwriters"; the Initial
U.S. Securities and the Initial International Securities are hereinafter
collectively called the "Initial Securities"; and the U.S. Securities and the
International Securities are hereinafter collectively called the "Securities."
The Underwriters will concurrently enter into an Intersyndicate
Agreement of even date herewith (the "Intersyndicate Agreement") providing for
the coordination of certain transactions among the Underwriters under the
direction of ▇▇▇▇▇▇▇ ▇▇▇▇▇ & Co., ▇▇▇▇▇▇▇ Lynch, Pierce, ▇▇▇▇▇▇ & ▇▇▇▇▇
Incorporated (in such capacity, the "Global Coordinator").
The Company understands that the International Managers propose to make
a public offering of the International Securities as soon as the Lead Managers
deem advisable after this Agreement has been executed and delivered.
It is understood that concurrently with the offering and sale of the
Securities the Company intends to offer and sell in a registered public offering
$250 million aggregate principal amount of convertible subordinated notes due
2004 (the "Convertible Notes"). The Company is concurrently entering into a
purchase agreement dated the date hereof (the "Convertible Note Purchase
Agreement") relating to the offering of Convertible Notes through arrangements
with certain underwriters. Neither the offer and sale of the Securities
2
contemplated hereby nor the offer and sale of Convertible Notes is conditioned
upon consummation of the other.
The Company has filed with the Securities and Exchange Commission (the
"Commission") a registration statement on Form S-1 (No. 333- ) covering, among
other things, the registration of the Securities under the Securities Act of
1933, as amended (the "1933 Act"), including the related preliminary prospectus
or prospectuses. Promptly after execution and delivery of this Agreement, the
Company will either (i) prepare and file a prospectus in accordance with the
provisions of Rule 430A ("Rule 430A") of the rules and regulations of the
Commission under the 1933 Act (the "1933 Act Regulations") and paragraph (b) of
Rule 424 ("Rule 424(b)") of the 1933 Act Regulations or (ii) if the Company has
elected to rely upon Rule 434 ("Rule 434") of the 1933 Act Regulations, prepare
and file a term sheet (a "Term Sheet") in accordance with the provisions of Rule
434 and Rule 424(b). Two forms of prospectus are to be used in connection with
the offering and sale of the Securities: (i) a form relating to the
International Securities (the "Form of International Prospectus") and (ii) a
form relating to the U.S. Securities (the "Form of U.S. Prospectus"). The Form
of International Prospectus is identical to the Form of U.S. Prospectus, except
for the front cover and back cover pages and the information under the caption
"Underwriting." The information included in any such prospectus or in any such
Term Sheet, as the case may be, that was omitted from such registration
statement at the time it became effective but that is deemed to be part of such
registration statement at the time it became effective (i) pursuant to paragraph
(b) of Rule 430A is referred to as "Rule 430A Information" or (ii) pursuant to
paragraph (d) of Rule 434 is referred to as "Rule 434 Information." Each Form of
International Prospectus and Form of U.S. Prospectus used before such
registration statement became effective, and any prospectus that omitted, as
applicable, the Rule 430A Information or the Rule 434 Information, that was used
after such effectiveness and prior to the execution and delivery of this
Agreement, is herein called a "preliminary prospectus." Such registration
statement, including the exhibits thereto and schedules thereto at the time it
became effective and including the Rule 430A Information and the Rule 434
Information, as applicable, is herein called the "Registration Statement." Any
registration statement filed pursuant to Rule 462(b) of the 1933 Act Regulations
is herein referred to as the "Rule 462(b) Registration Statement," and after
such filing the term "Registration Statement" shall include the Rule 462(b)
Registration Statement. The final Form of International Prospectus and Form of
U.S. Prospectus in the forms first furnished to the Underwriters for use in
connection with the offering of the Securities are herein called the
"International Prospectus" and the "U.S. Prospectus," respectively, and
collectively, the "Prospectuses." If Rule 434 is relied on, the terms
"International Prospectus" and "U.S. Prospectus" shall refer to the preliminary
International Prospectus dated , 1999 and the
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preliminary U.S. Prospectus dated , 1999, respectively, each together with the
applicable Term Sheet, and all references in this Agreement to the date of such
Prospectuses shall mean the date of the applicable Term Sheet.
For purposes of this Agreement, all references to the Registration
Statement, any preliminary prospectus, the International Prospectus, the U.S.
Prospectus or any Term Sheet or any amendment or supplement to any of the
foregoing shall be deemed to include the copy filed with the Commission pursuant
to its Electronic Data Gathering, Analysis and Retrieval system ("▇▇▇▇▇").
SECTION 1. Representations and Warranties.
(a) Representations and Warranties by the Company. The Company represents
and warrants to each International Manager as of the date hereof, as of the
Closing Time referred to in Section 2(c) hereof, and as of each Date of Delivery
(if any) referred to in Section 2(b), hereof and agrees with each International
Manager, as follows:
(i) Compliance with Registration Requirements. Each of the
Registration Statement and any Rule 462(b) Registration Statement has
become effective under the 1933 Act and no stop order suspending the
effectiveness of the Registration Statement or any Rule 462(b)
Registration Statement has been issued under the 1933 Act and no
proceedings for that purpose have been instituted or are pending or, to
the knowledge of the Company, are contemplated by the Commission, and
any request on the part of the Commission for additional information has
been complied with.
At the respective times the Registration Statement, any Rule
462(b) Registration Statement and any post-effective amendments thereto
became effective and at the Closing Time (and, if any International
Option Securities are purchased, at the Date of Delivery), the
Registration Statement, the Rule 462(b) Registration Statement and any
amendments and supplements thereto complied and will comply in all
material respects with the applicable requirements of the 1933 Act and
the 1933 Act Regulations and did not and will not contain an untrue
statement of a material fact or omit to state a material fact required
to be stated therein or necessary to make the statements therein not
misleading. None of the Prospectuses nor any amendments or supplements
thereto (including any prospectus wrapper), at the time the Prospectuses
or any amendments or supplements thereto were issued and at the Closing
Time (and, if any International Option Securities are purchased, at the
Date of Delivery), included or will include an untrue statement of a
material fact or omitted
4
or will omit to state a material fact necessary in order to make the
statements therein, in the light of the circumstances under which they
were made, not misleading. If Rule 434 is used, the Company will comply
with the requirements of Rule 434 and the Prospectuses shall not be
"materially different," as such term is used in Rule 434, from the
prospectuses included in the Registration Statement at the time it
became effective. The representations and warranties in this subsection
shall not apply to statements in or omissions from the Registration
Statement or the U.S. Prospectus made in reliance upon and in conformity
with information furnished to the Company in writing by any
International Manager through the Lead Managers expressly for use in the
Registration Statement or the U.S. Prospectus.
The prospectuses filed as part of the Registration Statement
as originally filed or as part of any amendment thereto, or filed
pursuant to Rule 424 under the 1933 Act, complied when so filed in all
material respects with the 1933 Act Regulations and each of the
preliminary prospectuses and the Prospectuses delivered to the
Underwriters for use in connection with this offering was identical to
the electronically transmitted copies thereof filed with the Commission
pursuant to ▇▇▇▇▇, except to the extent permitted by Regulation S-T.
(ii) Independent Accountants. The accountants who certified the
financial statements and supporting schedules included in the
Registration Statement and the financial statements and supporting
schedules thereto are independent public accountants as required by the
1933 Act and the 1933 Act Regulations.
(iii) Financial Statements. The financial statements included in the
Registration Statement and the Prospectuses, together with the related
schedules and notes, present fairly the financial position of the
Company and its consolidated subsidiaries at the dates indicated and the
statement of operations, stockholders' equity and cash flows of the
Company and its consolidated subsidiaries for the periods specified;
said financial statements have been prepared in conformity with
generally accepted accounting principles ("GAAP") applied on a
consistent basis throughout the periods involved. The selected financial
data and the summary financial information included in the Prospectuses
present fairly the information shown therein and have been compiled on a
basis consistent with that of the audited financial statements included
in the Registration
Statement. The pro forma financial statements and the related notes
thereto included in the Registration Statement and the Prospectuses present
fairly
5
the information shown therein, have been prepared in accordance with the
Commission's rules and guidelines with respect to pro forma financial statements
and have been properly compiled on the bases described therein, and the
assumptions used in the preparation thereof are reasonable and the adjustments
used therein are appropriate to give effect to the transactions and
circumstances referred to therein.
(iv) No Material Adverse Change in Business. Since the respective
dates as of which information is given in the Registration Statement and
the Prospectuses, except as otherwise stated therein, (A) there has been
no material adverse change in the condition, financial or otherwise, or
in the earnings, business affairs or business prospects of the Company,
its subsidiaries, as of the date hereof, and each of VerticalNet, Inc.,
Benchmarking Partners, Inc., Breakaway Solutions, Inc., ▇▇▇▇.▇▇▇, Inc.,
eMerge Interactive, Inc., ▇▇▇▇▇.▇▇▇, Inc., ▇▇▇▇▇▇▇▇▇▇▇▇▇.▇▇▇ LLC,
CommerX, Inc., CommerceQuest Inc., Purchasing Solutions, Inc.,
▇▇▇▇▇▇▇.▇▇▇, Universal Access, Inc. and VitalTone Inc. (each, a
"Material Holding" and, collectively, the "Material Holdings"),
considered as one enterprise reflecting the Company's ownership
interests in its subsidiaries and the Material Holdings, whether or not
arising in the ordinary course of business, (a "Material Adverse
Effect") (B) there have been no transactions entered into by the
Company, any of its subsidiaries or Material Holdings, other than those
in the ordinary course of business, which are material with respect to
the Company, its subsidiaries and the Material Holdings, considered as
one enterprise reflecting the Company's ownership interests in its
subsidiaries and the Material Holdings, and (C) there has been no
dividend or distribution of any kind declared, paid or made by the
Company on any class of its capital stock.
(v) Good Standing of the Company. The Company has been duly
organized and is validly existing as a corporation in good standing
under the laws of the State of Delaware and has corporate power and
authority to own, lease and operate its properties and to conduct its
business as described in the Prospectuses and to enter into and perform
its obligations under this Agreement and the International Purchase
Agreement; and the Company is duly qualified as a foreign corporation to
transact business and is in good standing in each other jurisdiction in
which such qualification is required, whether by reason of the ownership
or leasing of property or the conduct of business, except where the
failure so to qualify or to be in good standing would not result in a
Material Adverse Effect.
6
(vi) Good Standing of Subsidiaries and Material Holdings. Each of
the majority-owned subsidiaries of the Company (the "Subsidiaries") and each
Material Holding has been duly organized and is validly existing as a
corporation in good standing under the laws of the jurisdiction of its
incorporation, has corporate power and authority to own, lease and operate its
properties and to conduct its business as described in the Prospectuses and is
duly qualified as a foreign corporation to transact business and is in good
standing in each jurisdiction in which such qualification is required, whether
by reason of the ownership or leasing of property or the conduct of business,
except where the failure so to qualify or to be in good standing would not
result in a Material Adverse Effect; the issued and outstanding capital stock of
each of the Company's subsidiaries and each Material Holding has been duly
authorized and validly issued, is fully paid and non-assessable, and the Company
owns its interests in its Subsidiaries and the Material Holdings, in each case
in the amounts and percentages (subject to rounding) disclosed in the
Registration Statement, directly or through subsidiaries, free and clear of any
security interest, mortgage, pledge, lien, encumbrance, claim or equity except
for the security interest granted by the Company to PNC Bank, N.A. under the
revolving bank credit facility and as otherwise disclosed in the Registration
Statement; and none of the outstanding shares of capital stock of any of its
Subsidiaries or Material Holdings owned by the Company was issued in violation
of the preemptive or similar rights of any securityholder of such subsidiary or
Material Holding.
(vii) Capitalization. The authorized, issued and outstanding capital
stock of the Company is as set forth in the Prospectuses in the column entitled
"Actual" under the caption "Capitalization" (except for subsequent issuances, if
any, pursuant to this Agreement, the International Purchase Agreement and the
Convertible Note Purchase Agreement or pursuant to reservations, agreements or
employee benefit plans referred to in the Prospectuses or pursuant to the
exercise of convertible securities, warrants or options referred to in the
Prospectuses). The shares of issued and outstanding capital stock of the Company
have been duly authorized and validly issued and are fully paid and non-
assessable; none of the outstanding shares of capital stock of the Company was
issued in violation of the preemptive or other similar rights of any
securityholder of the Company.
(viii) Authorization of Agreements. Each of this Agreement, the U.S.
Purchase Agreement and the Convertible Note Purchase Agreement has been duly
authorized, executed and delivered by the Company.
7
(ix) Authorization and Description of Securities and Convertible
Notes. The Securities and the Convertible Notes have been duly authorized for
issuance and sale pursuant to this Agreement, the U.S. Purchase Agreement and
the Convertible Note Purchase Agreement, and, when issued and delivered by the
Company hereunder and thereunder, against payment of the consideration set forth
herein and therein, respectively, will be validly issued, fully paid and non-
assessable; the Common Stock and the Convertible Notes conform to all statements
relating thereto contained in the Prospectuses and such description conforms to
the rights set forth in the instruments defining the same; no holder of the
Securities or the Convertible Notes will be subject to personal liability by
reason of being such a holder; and the issuance of the Securities and the
Convertible Notes is not subject to the preemptive or other similar rights of
any securityholder of the Company.
(x) Absence of Defaults and Conflicts. Neither the Company nor any
of its Subsidiaries nor any Material Holding is in violation of its charter or
by-laws or in default in the performance or observance of any obligation,
agreement, covenant or condition contained in any contract, indenture, mortgage,
deed of trust, loan or credit agreement, note, lease or other agreement or
instrument to which the Company, any of its Subsidiaries or any Material Holding
is a party or by which it or any of them may be bound, or to which any of the
property or assets of the Company, any of its subsidiaries or any Material
Holding is subject (collectively, "Agreements and Instruments"), except for such
violations and defaults that would not result in a Material Adverse Effect; and
the execution, delivery and performance of this Agreement, the U.S. Purchase
Agreement and the Convertible Note Purchase Agreement and the consummation of
the transactions contemplated herein and therein and in the Registration
Statement (including the issuance and sale of the Securities and the use of the
proceeds from the sale of the Securities as described in the Prospectuses under
the caption "Use of Proceeds") and compliance by the Company with its
obligations under this Agreement, the U.S. Purchase Agreement and the
Convertible Note Purchase Agreement have been duly authorized by all necessary
corporate action and do not and will not, whether with or without the giving of
notice or passage of time or both, conflict with or constitute a breach of, or
default or Repayment Event (as defined below) under, or result in the creation
or imposition of any lien, charge or encumbrance upon any property or assets of
the Company or any of its Subsidiaries or Material Holdings pursuant to, the
Agreements and Instruments (except for such conflicts, breaches or defaults or
liens, charges or encumbrances that would not result in a Material Adverse
Effect), nor will such action result in any violation of the
8
provisions of the charter or by-laws of the Company or any of its Subsidiaries
or Material Holdings or any applicable law, statute, rule, regulation, judgment,
order, writ or decree of any government, government instrumentality or court,
domestic or foreign, having jurisdiction over the Company or any of its
Subsidiaries or Material Holdings or any of their assets, properties or
operations except such as may be required by the securities or Blue Sky laws of
the various states and jurisdictions in connection with the offer and sale of
the Common Stock or except for such violations that would not result in a
Material Adverse Effect. As used herein, a "Repayment Event" means any event or
condition which gives the holder of any note, debenture or other evidence of
indebtedness (or any person acting on such holder's behalf) the right to require
the repurchase, redemption or repayment of all or a portion of such indebtedness
by the Company or any of its Subsidiaries or Material Holdings.
(xi) Absence of Labor Dispute. No labor dispute with the employees
of the Company or any of its Subsidiaries or Material Holdings exists or, to the
knowledge of the Company, is imminent, and the Company is not aware of any
existing or imminent labor disturbance by the employees of any of its or any
Subsidiary's or Material Holding's principal suppliers, manufacturers, customers
or contractors, which, in either case, may reasonably be expected to result in a
Material Adverse Effect.
(xii) Absence of Proceedings. There is no action, suit, proceeding,
inquiry or investigation before or brought by any court or governmental agency
or body, domestic or foreign, now pending, or, to the knowledge of the Company,
threatened, against or affecting the Company or any of its Subsidiaries or
Material Holdings, which is required to be disclosed in the Registration
Statement (other than as disclosed therein), or which might reasonably be
expected to result in a Material Adverse Effect, or which might reasonably be
expected to materially and adversely affect the properties or assets of the
Company, its Subsidiaries and the Material Holdings, considered as one
enterprise reflecting the Company's ownership interests in its Subsidiaries and
the Material Holdings or the consummation of the transactions contemplated in
this Agreement, the U.S. Purchase Agreement and the Convertible Note Purchase
Agreement or the performance by the Company of its obligations hereunder or
thereunder; the aggregate of all pending legal or governmental proceedings to
which the Company or any of its Subsidiaries or Material Holdings is a party or
of which any of their respective property or assets is the subject which are not
described in the Registration Statement, including ordinary routine
9
litigation incidental to the business, could not reasonably be expected to
result in a Material Adverse Effect.
(xiii) Accuracy of Exhibits. There are no contracts or documents which
are required to be described in the Registration Statement or the Prospectuses
or to be filed as exhibits thereto which have not been so described and filed as
required.
(xiv) Possession of Intellectual Property. The Company, its
Subsidiaries and its Material Holdings own or possess, or can acquire on
reasonable terms, adequate patents, patent rights, licenses, inventions,
copyrights, know-how (including trade secrets and other unpatented and/or
unpatentable proprietary or confidential information, systems or procedures),
trademarks, service marks, trade names or other intellectual property
(collectively, "Intellectual Property") necessary to carry on the business now
operated by them, and neither the Company nor any of its Subsidiaries or
Material Holdings has received any notice or is otherwise aware of any
infringement of or conflict with asserted rights of others with respect to any
Intellectual Property or of any facts or circumstances which would render any
Intellectual Property invalid or inadequate to protect the interest of the
Company or any of its Subsidiaries or Material Holdings therein, and which
infringement or conflict (if the subject of any unfavorable decision, ruling or
finding) or invalidity or inadequacy, singly or in the aggregate, would result
in a Material Adverse Effect.
(xv) Absence of Further Requirements. No filing with, or
authorization, approval, consent, license, order, registration, qualification or
decree of, any court or governmental authority or agency is necessary or
required for the performance by the Company of its obligations hereunder, in
connection with the offering, issuance or sale of the Securities under this
Agreement and the U.S. Purchase Agreement and of the Convertible Notes under the
Convertible Note Purchase Agreement or the consummation of the transactions
contemplated herein and therein, except such as have been already obtained or as
may be required under the 1933 Act or the 1933 Act Regulations and foreign or
state securities or blue sky law.
(xvi) Possession of Licenses and Permits. The Company, its
Subsidiaries and its Material Holdings possess such permits, licenses,
approvals, consents and other authorizations (collectively, "Governmental
Licenses") issued by the appropriate federal, state, local or foreign regulatory
agencies or bodies necessary to conduct the business now operated by them; the
Company, its Subsidiaries and its Material Holdings are in compliance with the
terms and conditions of all such Governmental
10
Licenses, except where the failure so to comply would not, singly or in the
aggregate, have a Material Adverse Effect; all of the Governmental Licenses are
valid and in full force and effect, except when the invalidity of such
Governmental Licenses or the failure of such Governmental Licenses to be in full
force and effect would not have a Material Adverse Effect; and neither the
Company nor any of its Subsidiaries or Material Holdings has received any notice
of proceedings relating to the revocation or modification of any such
Governmental Licenses which, singly or in the aggregate, if the subject of an
unfavorable decision, ruling or finding, would result in a Material Adverse
Effect.
(xvii) Title to Property. The Company, its Subsidiaries and its
Material Holdings have good and marketable title to all real property owned by
the Company, its Subsidiaries and its Material Holdings and good title to all
other properties owned by them, in each case, free and clear of all mortgages,
pledges, liens, security interests, claims, restrictions or encumbrances of any
kind except such as (a) are described in the Prospectuses or (b) do not, singly
or in the aggregate, materially affect the value of such property and do not
interfere with the use made and proposed to be made of such property by the
Company or any of its Subsidiaries or Material Holdings; and all of the leases
and subleases material to the business of the Company, its Subsidiaries and its
Material Holdings, considered as one enterprise, and under which the Company or
any of its Subsidiaries or Material Holdings holds properties described in the
Prospectuses, are in full force and effect, and neither the Company nor any
subsidiary nor any Material Holding has any notice of any material claim of any
sort that has been asserted by anyone adverse to the rights of the Company or
any of its Subsidiaries or Material Holdings under any of the leases or
subleases mentioned above, or affecting or questioning the rights of the Company
or any such subsidiary or Material Holding to the continued possession of the
leased or subleased premises under any such lease or sublease.
(xviii) Investment Company Act. The Company is not, and upon the
issuance and sale of the Securities and the Convertible Notes as contemplated
herein and in the Convertible Note Purchase Agreement, will not be, required to
register as an "investment company" under the Investment Company Act of 1940, as
amended (the "1940 Act").
(xix) Environmental Laws. Except as described in the Registration
Statement and except as would not, singly or in the aggregate, have a Material
Adverse Effect, (A) neither the Company nor any of its Subsidiaries or Material
Holdings is in violation of any federal, state, local
11
or foreign statute, law, rule, regulation, ordinance, code, policy or rule of
common law or any judicial or administrative interpretation thereof, including
any judicial or administrative order, consent, decree or judgment, relating to
pollution or protection of human health, the environment (including, without
limitation, ambient air, surface water, groundwater, land surface or subsurface
strata) or wildlife, including, without limitation, laws and regulations
relating to the release or threatened release of chemicals, pollutants,
contaminants, wastes, toxic substances, hazardous substances, petroleum or
petroleum products (collectively, "Hazardous Materials") or to the manufacture,
processing, distribution, use, treatment, storage, disposal, transport or
handling of Hazardous Materials (collectively, "Environmental Laws"), (B) the
Company, its Subsidiaries and its Material Holdings have all permits,
authorizations and approvals required under any applicable Environmental Laws
and are each in compliance with their requirements, (C) there are no pending or
threatened administrative, regulatory or judicial actions, suits, demands,
demand letters, claims, liens, notices of noncompliance or violation,
investigation or proceedings relating to any Environmental Law against the
Company, any of its Subsidiaries or any of its Material Holdings and (D) there
are no events or circumstances that might reasonably be expected to form the
basis of an order for clean-up or remediation, or an action, suit or proceeding
by any private party or governmental body or agency, against or affecting the
Company, any of its Subsidiaries or any of its Material Holdings relating to
Hazardous Materials or any Environmental Laws.
(xx) Registration Rights. Other than rights that have been waived
for 180 days from August 4, 1999, the date of the initial public offering of
shares of common stock of the Company, there are no persons with registration
rights or other similar rights to have any securities registered pursuant to the
Registration Statement or otherwise registered by the Company under the 1933
Act.
(xxi) Year 2000. The Company is reviewing its operations and those of
its Subsidiaries and any Material Holdings to evaluate the extent to which the
businesses or operations of the Company or any of its Subsidiaries or Material
Holdings will be affected by the Year 2000 Problem; as a result of such review,
the Company believes that the disclosure in the Prospectuses relating to the
Year 2000 Problem is accurate in all material respects. As used in clause (xxi),
the "Year 2000 Problem" means any significant risk that computer hardware or
software used in the receipt, transmission, processing, manipulation, storage,
retrieval, transmission or other utilization of data or in the operation of
mechanical or electrical systems of any kind will not materially affect the
business
12
operations of the Company, its Subsidiaries and any Material Holdings
after December 31, 1999.
(b) Officer's Certificates. Any certificate signed by any officer of the
Company or any of its Subsidiaries or Material Holdings delivered to the Global
Coordinator, the Lead Managers or to counsel for the International Managers
shall be deemed a representation and warranty by the Company to each
International Manager as to the matters covered thereby.
SECTION 2. Sale and Delivery to International Managers; Closing.
(a) Initial Securities. On the basis of the representations and
warranties herein contained and subject to the terms and conditions herein set
forth, the Company agrees to sell to each International Manager, severally and
not jointly, and each International Manager, severally and not jointly, agrees
to purchase from the Company, at the price per share set forth in Schedule B,
the number of Initial International Securities set forth in Schedule A opposite
the name of such International Manager, plus any additional number of Initial
International Securities which such Underwriter may become obligated to purchase
pursuant to the provisions of Section 10 hereof.
(b) Option Securities. In addition, on the basis of the representations
and warranties herein contained and subject to the terms and conditions herein
set forth, the Company hereby grants an option to the International Managers,
severally and not jointly, to purchase up to an additional shares of Common
Stock at the price per share set forth in Schedule B, less an amount per share
equal to any dividends or distributions declared by the Company and payable on
the Initial International Securities but not payable on the International Option
Securities. The option hereby granted will expire 30 days after the date hereof
and may be exercised in whole or in part from time to time only for the purpose
of covering over-allotments which may be made in connection with the offering
and distribution of the Initial International Securities upon notice by the
Global Coordinator to the Company setting forth the number of International
Option Securities as to which the several International Managers are then
exercising the option and the time and date of payment and delivery for such
International Option Securities. Any such time and date of delivery for the
International Option Securities (a "Date of Delivery") shall be determined by
the Global Coordinator, but shall not be earlier than two nor later than seven
full business days after the exercise of said option, nor in any event prior to
the Closing Time, as hereinafter defined. If the option is exercised as to all
or any portion of the International Option Securities, each of the International
Managers, acting severally and not jointly, will purchase that proportion of the
total number of International Option Securities then being purchased which the
number of Initial International Securities
13
set forth in Schedule A opposite the name of such International Manager bears to
the total number of Initial International Securities, subject in each case to
such adjustments as the Global Coordinator in its discretion shall make to
eliminate any sales or purchases of fractional shares.
(c) Payment. Payment of the purchase price for, and delivery of
certificates for, the Initial Securities shall be made at the offices of Dechert
Price & ▇▇▇▇▇▇, 4000 ▇▇▇▇ Atlantic Tower ▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇▇,
▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇, or at such other place as shall be agreed upon by the Global
Coordinator and the Company, at 9:00 A.M. (Eastern time) on the third (fourth,
if the pricing occurs after 4:30 P.M. (Eastern time) on any given day) business
day after the date hereof (unless postponed in accordance with the provisions of
Section 10), or such other time not later than ten business days after such date
as shall be agreed upon by the Global Coordinator and the Company (such time and
date of payment and delivery being herein called "Closing Time").
In addition, in the event that any or all of the International Option
Securities are purchased by the International Managers, payment of the purchase
price for, and delivery of certificates for, such International Option
Securities shall be made at the above-mentioned offices, or at such other place
as shall be agreed upon by the Global Coordinator and the Company, on each Date
of Delivery as specified in the notice from the Global Coordinator to the
Company.
Payment shall be made to the Company by wire transfer of immediately
available funds to a bank account designated by the Company, against delivery to
the Lead Managers for the respective accounts of the International Managers of
certificates for the International Securities to be purchased by them. It is
understood that each International Manager has authorized the Lead Managers, for
its account, to accept delivery of, receipt for, and make payment of the
purchase price for, the Initial International Securities and the International
Option Securities, if any, which it has agreed to purchase. ▇▇▇▇▇▇▇ ▇▇▇▇▇,
individually and not as representative of the International Managers, may (but
shall not be obligated to) make payment of the purchase price for the Initial
International Securities or the International Option Securities, if any, to be
purchased by any International Manager whose funds have not been received by the
Closing Time or the relevant Date of Delivery, as the case may be, but such
payment shall not relieve such International Manager from its obligations
hereunder.
(d) Denominations; Registration. Certificates for the Initial
International Securities and the International Option Securities, if any, shall
be in such denominations and registered in such names as the Lead Managers may
request in writing not later than 10:00 A.M. on the second business day before
the Closing Time or the relevant Date of Delivery, as the case may be. The
certificates for the
14
Initial International Securities and the International Option Securities, if
any, will be made available for examination and packaging by the Lead Managers
in The City of New York not later than 10:00 A.M. (Eastern time) on the business
day prior to the Closing Time or the relevant Date of Delivery, as the case may
be.
SECTION 3. Covenants of the Company. The Company covenants with each
International Manager as follows:
(a) Compliance with Securities Regulations and Commission Requests. The
Company, subject to Section 3(b), will comply with the requirements of Rule 430A
or Rule 434, as applicable, and will notify the Global Coordinator immediately,
and confirm the notice in writing, (i) when any post-effective amendment to the
Registration Statement shall become effective, or any supplement to the
Prospectuses or any amended Prospectuses shall have been filed, (ii) of the
receipt of any comments from the Commission, (iii) of any request by the
Commission for any amendment to the Registration Statement or any amendment or
supplement to the Prospectuses or for additional information, and (iv) of the
issuance by the Commission of any stop order suspending the effectiveness of the
Registration Statement or of any order preventing or suspending the use of any
preliminary prospectus, or of the suspension of the qualification of the
Securities for offering or sale in any jurisdiction, or of the initiation or
threatening of any proceedings for any of such purposes. The Company will
promptly effect the filings necessary pursuant to Rule 424(b) and will take such
steps as it deems necessary to ascertain promptly whether the form of prospectus
transmitted for filing under Rule 424(b) was received for filing by the
Commission and, in the event that it was not, it will promptly file such
prospectus. The Company will make every reasonable effort to prevent the
issuance of any stop order and, if any stop order is issued, to obtain the
lifting thereof at the earliest possible moment.
(b) Filing of Amendments. The Company will give the Global Coordinator
notice of its intention to file or prepare any amendment to the Registration
Statement (including any filing under Rule 462(b)), any Term Sheet or any
amendment, supplement or revision to either the prospectus included in the
Registration Statement at the time it became effective or to the Prospectuses,
will furnish the Global Coordinator with copies of any such documents a
reasonable amount of time prior to such proposed filing or use, as the case may
be, and will not file or use any such document to which the Global Coordinator
or counsel for the International Managers shall object.
(c) Delivery of Registration Statements. The Company has furnished or
will deliver to the Lead Managers and counsel for the International Managers,
without charge, signed copies of the Registration Statement as originally filed
and of each amendment thereto (including exhibits filed therewith or
incorporated by
15
reference therein) and signed copies of all consents and certificates of
experts, and will also deliver to the Lead Managers, without charge, a conformed
copy of the Registration Statement as originally filed and of each amendment
thereto (without exhibits) for each of the International Managers. The copies of
the Registration Statement and each amendment thereto furnished to the
International Managers will be identical to the electronically transmitted
copies thereof filed with the Commission pursuant to ▇▇▇▇▇, except to the extent
permitted by Regulation S-T.
(d) Delivery of Prospectuses. The Company has delivered to each
International Manager, without charge, as many copies of each preliminary
prospectus as such International Manager reasonably requested, and the Company
hereby consents to the use of such copies for purposes permitted by the 1933
Act. The Company will furnish to each International Manager, without charge,
during the period when the U.S. Prospectus is required to be delivered under the
1933 Act or the Securities Exchange Act of 1934 (the "1934 Act"), such number of
copies of the U.S. Prospectus (as amended or supplemented) as such International
Manager may reasonably request but in no event later than 4 days following the
date of this Agreement. The U.S. Prospectus and any amendments or supplements
thereto furnished to the International Managers will be identical to the
electronically transmitted copies thereof filed with the Commission pursuant to
▇▇▇▇▇, except to the extent permitted by Regulation S-T.
(e) Continued Compliance with Securities Laws. The Company will comply
with the applicable requirements of the 1933 Act and the 1933 Act Regulations so
as to permit the completion of the distribution of the Securities and the
Convertible Notes as contemplated in this Agreement, the International Purchase
Agreement and the Convertible Note Purchase Agreement and in the Prospectuses.
If at any time when a prospectus is required by the 1933 Act to be delivered in
connection with sales of the Securities and the Convertible Notes, any event
shall occur or condition shall exist as a result of which it is necessary, in
the opinion of counsel for the International Managers or for the Company, to
amend the Registration Statement or amend or supplement any Prospectus in order
that the Prospectuses will not include any untrue statements of a material fact
or omit to state a material fact necessary in order to make the statements
therein not misleading in the light of the circumstances existing at the time it
is delivered to a purchaser, or if it shall be necessary, in the opinion of such
counsel, at any such time to amend the Registration Statement or amend or
supplement any Prospectus in order to comply with the applicable requirements of
the 1933 Act or the 1933 Act Regulations, the Company will promptly prepare and
file with the Commission, subject to Section 3(b), such amendment or supplement
as may be necessary to correct such statement or omission or to make the
Registration Statement or the Prospectuses comply with such requirements, and
the Company
16
will furnish to the International Managers such number of copies of such
amendment or supplement as the International Managers may reasonably request.
(f) Blue Sky Qualifications. The Company will endeavor, in cooperation
with the International Managers, to qualify the Securities for offering and sale
under the applicable securities laws of such states and other jurisdictions
(domestic or foreign) as the Global Coordinator may designate and to maintain
such qualifications in effect for a period of not less than one year from the
later of the effective date of the Registration Statement and any Rule 462(b)
Registration Statement; provided, however, that the Company shall not be
obligated to file any general consent to service of process or to qualify as a
foreign corporation or as a dealer in securities in any jurisdiction in which it
is not so qualified or to subject itself to taxation in respect of doing
business in any jurisdiction in which it is not otherwise so subject. In each
jurisdiction in which the Securities have been so qualified, the Company will
file such statements and reports as may be required by the laws of such
jurisdiction to continue such qualification in effect for a period of not less
than one year from the effective date of the Registration Statement and any Rule
462(b) Registration Statement.
(g) Rule 158. The Company will file such reports pursuant to the 1934 Act
as are necessary in order to make generally available to its securityholders no
later than 45 days after an earnings statement for the purposes of, and to
provide the benefits contemplated by, the last paragraph of Section 11(a) of the
1933 Act.
(h) Use of Proceeds. The Company will use the net proceeds received by it
from the sale of the Securities in the manner specified in the Prospectuses
under "Use of Proceeds."
(i) Listing. The Company will use its best efforts to maintain the
quotation of the Securities on the Nasdaq National Market and will file with the
Nasdaq National Market all documents and notices required by the Nasdaq National
Market of companies that have securities that are traded in the over-the-counter
market and quotations for which are reported by the Nasdaq National Market.
(j) Restriction on Sale of Securities. During a period of [180] days from
the date of the Prospectuses, the Company will not, without the prior written
consent of ▇▇▇▇▇▇▇ ▇▇▇▇▇, directly or indirectly, (i) offer, pledge, sell,
contract to sell, sell any option or contract to purchase, purchase any option
or contract to sell, grant any option, right or warrant for the sale of, or
otherwise transfer or dispose of or transfer any shares of Common Stock or any
securities convertible into or exchangeable or exercisable for Common Stock or
file any registration statement under the 1933 Act with respect to any of the
foregoing or (ii) enter into any swap
17
or any other agreement or any transaction that transfers, in whole or in part,
the economic consequence of ownership of the Common Stock, whether any such swap
or transaction described in clause (i) or (ii) above is to be settled by
delivery of Common Stock or other securities, in cash or otherwise. The
foregoing sentence shall not apply to (A) the Securities to be sold hereunder
and under the International Purchase Agreement, (B) any shares of Common Stock
issued by the Company upon the exercise of an option or warrant or the
conversion of a security outstanding on the date hereof and referred to in the
Prospectuses, (C) any shares of Common Stock issued or options to purchase
Common Stock granted pursuant to existing employee benefit plans of the Company
referred to in the Prospectuses or (D) any shares of Common Stock issued
pursuant to any non-employee director stock plan or dividend reinvestment plan.
(k) Reporting Requirements. The Company, during the period when the
Prospectuses are required to be delivered under the 1933 Act or the 1934 Act,
will file all documents required to be filed with the Commission pursuant to the
1934 Act within the time periods required by the 1934 Act and the rules and
regulations of the Commission thereunder.
(l) Compliance with Rule 463. The Company will file with the Commission
such reports as may be required pursuant to Rule 463 of the 1933 Act
Regulations.
SECTION 4. Payment of Expenses.
(a) Expenses. The Company will pay all expenses incident to the
performance of its obligations under this Agreement, the International Purchase
Agreement and the Convertible Note Purchase Agreement including (i) the
preparation, printing and filing of the Registration Statement (including
financial statements and exhibits) as originally filed and of each amendment
thereto, (ii) the preparation, issuance and delivery of the certificates for the
Securities and the Convertible Notes, issuance or delivery of the Securities and
the Convertible Notes and the transfer of the Securities and the Convertible
Notes, (iii) the fees and disbursements of the Company's counsel, accountants
and other advisors, (iv) the qualification of the Securities and the Convertible
Notes under securities laws in accordance with the provisions of Section 3(f)
hereof, including filing fees and the reasonable fees and disbursements of
counsel for the Underwriters in connection therewith and in connection with the
preparation of the Blue Sky Survey and any supplement thereto, (v) the printing
and delivery to the Underwriters of copies of each preliminary prospectus, any
of the Prospectuses and any amendments or supplements thereto, (vi) the
preparation, printing and delivery to the Underwriters of copies of the Blue Sky
Survey and any supplement thereto, (vii) the fees and expenses of any transfer
agent or registrar for the Securities and the Convertible
18
Notes and (viii) the filing fees incident to, and the reasonable fees and
disbursements of counsel to the Underwriters in connection with, the review by
the National Association of Securities Dealers, Inc. (the "NASD") of the terms
of the sale of the Securities and the Convertible Notes and (ix) the fees and
expenses incurred in connection with the inclusion of the Securities in the
Nasdaq National Market.
(b) Termination of Agreement. If this Agreement is terminated by the Lead
Managers in accordance with the provisions of Section 5 or Section 9(a)(i)
hereof, the Company shall reimburse the International Managers for all of their
out-of-pocket expenses, including the reasonable fees and disbursements of
counsel for the International Managers.
SECTION 5. Conditions of International Managers' Obligations. The
obligations of the several International Managers hereunder are subject to the
accuracy of the representations and warranties of the Company contained in
Section 1 hereof or in certificates of any officer of the Company or any of its
Subsidiaries or Material Holdings of the Company delivered pursuant to the
provisions hereof, to the performance by the Company of its covenants and other
obligations hereunder, and to the following further conditions:
(a) Effectiveness of Registration Statement. The Registration Statement,
including any Rule 462(b) Registration Statement, has become effective and at
Closing Time no stop order suspending the effectiveness of the Registration
Statement shall have been issued under the 1933 Act or proceedings therefor
initiated or threatened by the Commission, and any request on the part of the
Commission for additional information shall have been complied with to the
reasonable satisfaction of counsel to the International Managers. A prospectus
containing the Rule 430A Information shall have been filed with the Commission
in accordance with Rule 424(b) (or a post-effective amendment providing such
information shall have been filed and declared effective in accordance with the
requirements of Rule 430A) or, if the Company has elected to rely upon Rule 434,
a Term Sheet shall have been filed with the Commission in accordance with Rule
424(b).
(b) Opinions of Counsel for Company. At Closing Time, the Lead Managers
shall have received the favorable opinion, dated as of Closing Time, of (x)
Dechert Price & ▇▇▇▇▇▇, counsel for the Company, and (y) ▇▇▇▇▇ ▇▇▇▇ & ▇▇▇▇▇▇▇▇,
special 1940 Act counsel for the Company, in form and substance satisfactory to
counsel for the International Managers, together with signed or reproduced
copies of such letter for each of the other International Managers to the effect
set forth in Exhibit A and Exhibit B hereto, respectively . Such counsel may
also state that, insofar as such opinion involves factual matters, they
19
have relied, to the extent they deem proper, upon certificates of officers of
the Company, its Subsidiaries and its Material Holdings and certificates of
public officials
(c) Opinion of Counsel for International Managers. At Closing Time, the
Lead Managers shall have received the favorable opinion, dated as of Closing
Time, of ▇▇▇▇▇ ▇▇▇▇ & ▇▇▇▇▇▇▇▇, counsel for the International Managers, together
with signed or reproduced copies of such letter for each of the other
International Managers in form and substance satisfactory to the Lead Managers,
and the penultimate paragraph of Exhibit A hereto. Such counsel may also state
that, insofar as such opinion involves factual matters, they have relied, to the
extent they deem proper, upon certificates of officers of the Company, its
Subsidiaries and its Material Holdings and certificates of public officials.
(d) Officers' Certificate. At Closing Time, there shall not have been,
since the date hereof or since the respective dates as of which information is
given in the Prospectuses, any Material Adverse Effect, whether or not arising
in the ordinary course of business, and the Lead Managers shall have received a
certificate of the President or a Vice President of the Company and of the chief
financial or chief accounting officer of the Company, dated as of Closing Time,
to the effect that (i) there has been no such Material Adverse Effect, (ii) the
representations and warranties in Section 1(a) hereof are true and correct with
the same force and effect as though expressly made at and as of Closing Time,
(iii) the Company has complied in all material respects with all agreements and
satisfied in all material respects all conditions on its part to be performed or
satisfied at or prior to Closing Time, and (iv) no stop order suspending the
effectiveness of the Registration Statement has been issued and no proceeding
for that purpose has been instituted or is pending or is contemplated by the
Commission.
(e) Accountant's Comfort Letters. At the time of the execution of this
Agreement, the Lead Managers shall have received one or more letters from KPMG
LLP dated such date, in form and substance satisfactory to the Lead Managers,
together with signed or reproduced copies of such letter(s) for each of the
other International Managers containing statements and information of the type
ordinarily included in accountants' "comfort letters" to underwriters with
respect to the financial statements and certain financial information contained
in the Registration Statement and the Prospectuses.
(f) Bring-down Comfort Letter. At Closing Time, the Representatives
shall have received from KPMG LLP letter(s), dated as of Closing Time, to the
effect that they reaffirm the statements made in the letters furnished pursuant
to subsection (e) of this Section, except that the specified date referred to
shall be a date not more than three business days prior to Closing Time.
20
(g) No Objection. The NASD has confirmed that it has not raised any
objection with respect to the fairness and reasonableness of the underwriting
terms and arrangements.
(h) Lock-up Agreements. At the date of this Agreement, the Lead
Managers shall have received an agreement substantially in the form of
Exhibit C hereto signed by such securityholders as the U.S. Representatives and
the Company may mutually agree.
(i) Purchase of Initial U.S. Securities. Contemporaneously with the
purchase by the International Managers of the Initial International Securities
under this Agreement, the U.S. Underwriters shall have purchased the Initial
U.S. Securities under the U.S. Purchase Agreement.
(j) Conditions to Purchase of International Option Securities. In the
event that the International Managers exercise their option provided in Section
2(b) hereof to purchase all or any portion of the International Option
Securities, the representations and warranties of the Company contained herein
and the statements in any certificates furnished by the Company or any
subsidiary of the Company hereunder shall be true and correct as of each Date of
Delivery and, at the relevant Date of Delivery, the Lead Managers shall have
received:
(i) Officers' Certificate. A certificate, dated such Date of
Delivery, of the President or a Vice President of the Company and of the
chief financial or chief accounting officer of the Company confirming
that the certificate delivered at the Closing Time pursuant to Section
5(d) hereof remains true and correct as of such Date of Delivery.
(ii) Opinion of Counsel for Company. The favorable opinion of
Dechert Price & ▇▇▇▇▇▇, counsel for the Company, in form and substance
satisfactory to counsel for the International Managers, dated such Date
of Delivery, relating to the International Option Securities to be
purchased on such Date of Delivery and otherwise to the same effect as
the opinion required by Section 5(b) hereof.
(iii) Opinion of Special 1940 Act Counsel. The favorable opinion
of ▇▇▇▇▇ ▇▇▇▇ & ▇▇▇▇▇▇▇▇, special 1940 Act counsel for the Company,
dated such Date of Delivery, relating to the 1940 Act and otherwise to
the same effect as the opinion required by Section 5(b) hereof.
21
(iv) Opinion of Counsel for International Managers. The
favorable opinion of ▇▇▇▇▇ ▇▇▇▇ & ▇▇▇▇▇▇▇▇, counsel for the
International Managers, dated such Date of Delivery, relating to the
International Option Securities to be purchased on such Date of Delivery
and otherwise to the same effect as the opinion required by Section 5(c)
hereof.
(v) Bring-down Comfort Letter. One or more letters from KPMG
LLP, in form and substance satisfactory to the Lead Managers and dated
such Date of Delivery, substantially in the same form and substance as
the letter furnished to the Lead Managers pursuant to Section 5(f)
hereof, except that the "specified date" in the letter furnished
pursuant to this paragraph shall be a date not more than five days prior
to such Date of Delivery.
(k) Additional Documents. At Closing Time and at each Date of Delivery,
counsel for the International Managers shall have been furnished with such
documents and opinions as they may require for the purpose of enabling them to
pass upon the issuance and sale of the Securities and the Convertible Notes as
contemplated herein or in the Convertible Note Purchase Agreement, as the case
may be, or in order to evidence the accuracy of any of the representations or
warranties, or the fulfillment of any of the conditions, herein contained; and
all proceedings taken by the Company in connection with the issuance and sale of
the Securities and the Convertible Notes as contemplated herein or in the
Convertible Note Purchase Agreement, as the case may be, shall be satisfactory
in form and substance to the Lead Managers and counsel for the International
Managers.
(l) Termination of Agreement. If any condition specified in this Section
shall not have been fulfilled in all material respects when and as required to
be fulfilled, this Agreement, or, in the case of any condition to the purchase
of International Option Securities on a Date of Delivery which is after the
Closing Time, the obligations of the several International Managers to purchase
the relevant Option Securities, may be terminated by the Lead Managers by notice
to the Company at any time at or prior to Closing Time or such Date of Delivery,
as the case may be, and such termination shall be without liability of any party
to any other party except as provided in Section 4 and except that Sections 1,
6, 7 and 8 shall survive any such termination and remain in full force and
effect.
SECTION 6. Indemnification.
(a) Indemnification of International Managers. The Company agrees to
indemnify and hold harmless each International Manager and each person, if any,
22
who controls any International Manager within the meaning of Section 15 of the
1933 Act or Section 20 of the 1934 Act as follows:
(i) against any and all loss, liability, claim, damage and
expense whatsoever, as incurred, arising out of any untrue statement or
alleged untrue statement of a material fact contained in the
Registration Statement (or any amendment thereto), including the Rule
430A Information and the Rule 434 Information, if applicable, or the
omission or alleged omission therefrom of a material fact required to be
stated therein or necessary to make the statements therein not
misleading or arising out of any untrue statement or alleged untrue
statement of a material fact included in any preliminary prospectus or
the Prospectuses (or any amendment or supplement thereto), or the
omission or alleged omission therefrom of a material fact necessary in
order to make the statements therein, in the light of the circumstances
under which they were made, not misleading;
(ii) against any and all loss, liability, claim, damage and
expense whatsoever, as incurred, to the extent of the aggregate amount
paid in settlement of any litigation, or any investigation or proceeding
by any governmental agency or body, commenced or threatened, or of any
claim whatsoever based upon any such untrue statement or omission, or
any such alleged untrue statement or omission; provided that (subject to
Section 6(d) below) any such settlement is effected with the written
consent of the Company; and
(iii) against any and all expense whatsoever, as incurred
(including the fees and disbursements of counsel chosen by ▇▇▇▇▇▇▇
▇▇▇▇▇), reasonably incurred in investigating, preparing or defending
against any litigation, or any investigation or proceeding by any
governmental agency or body, commenced or threatened, or any claim
whatsoever based upon any such untrue statement or omission, to the
extent that any such expense is not paid under (i) or (ii) above;
provided, however, that this indemnity agreement shall not apply to any loss,
-------- -------
liability, claim, damage or expense to the extent arising out of any untrue
statement or omission or alleged untrue statement or omission made in reliance
upon and in conformity with written information furnished to the Company by any
International Manager through the Lead Managers expressly for use in the
Registration Statement (or any amendment thereto), including the Rule 430A
Information and the Rule 434 Information, if applicable, or any preliminary
international prospectus or the International Prospectus (or any amendment or
supplement thereto) provided, further, that the foregoing indemnity agreement
with respect to any preliminary prospectus shall not inure to the benefit of any
International Manager
23
who failed to deliver an International Prospectus to the person asserting any
such losses, liabilities, claims, damages and expenses.
(b) Indemnification of Company, Directors and Officers. Each
International Manager severally agrees to indemnify and hold harmless the
Company, its directors, each of its officers who signed the Registration
Statement, and each person, if any, who controls the Company within the meaning
of Section 15 of the 1933 Act or Section 20 of the 1934 Act against any and all
loss, liability, claim, damage and expense described in the indemnity contained
in subsection (a) of this Section, as incurred, but only with respect to untrue
statements or omissions, or alleged untrue statements or omissions, made in the
Registration Statement (or any amendment thereto), including the Rule 430A
Information and the Rule 434 Information, if applicable, or any preliminary
international prospectus or the International Prospectus (or any amendment or
supplement thereto) in reliance upon and in conformity with written information
furnished to the Company by such International Manager through the Lead Managers
expressly for use in the Registration Statement (or any amendment thereto) or
such preliminary international prospectus or the International Prospectus (or
any amendment or supplement thereto).
(c) Actions against Parties; Notification. Each indemnified party shall
give notice as promptly as reasonably practicable to each indemnifying party of
any action commenced against it in respect of which indemnity may be sought
hereunder, but failure to so notify an indemnifying party shall not relieve such
indemnifying party from any liability hereunder to the extent it is not
materially prejudiced as a result thereof and in any event shall not relieve it
from any liability which it may have otherwise than on account of this indemnity
agreement. In the case of parties indemnified pursuant to Section 6(a) above,
counsel to the indemnified parties shall be selected by ▇▇▇▇▇▇▇ ▇▇▇▇▇, and, in
the case of parties indemnified pursuant to Section 6(b) above, counsel to the
indemnified parties shall be selected by the Company. An indemnifying party may
participate at its own expense in the defense of any such action; provided,
however, that counsel to the indemnifying party shall not (except with the
consent of the indemnified party) also be counsel to the indemnified party. In
no event shall the indemnifying parties be liable for fees and expenses of more
than one counsel (in addition to any local counsel) separate from their own
counsel for all indemnified parties in connection with any one action or
separate but similar or related actions in the same jurisdiction arising out of
the same general allegations or circumstances. No indemnifying party shall,
without the prior written consent of the indemnified parties, settle or
compromise or consent to the entry of any judgment with respect to any
litigation, or any investigation or proceeding by any governmental agency or
body, commenced or threatened, or any claim whatsoever in respect of which
indemnification or contribution could be sought under this Section 6 or
Section 7
24
hereof (whether or not the indemnified parties are actual or potential parties
thereto), unless such settlement, compromise or consent (i) includes an
unconditional release of each indemnified party from all liability arising out
of such litigation, investigation, proceeding or claim and (ii) does not include
a statement as to or an admission of fault, culpability or a failure to act by
or on behalf of any indemnified party.
(d) Settlement without Consent if Failure to Reimburse. If at any time
an indemnified party shall have requested an indemnifying party to reimburse the
indemnified party for fees and expenses of counsel, such indemnifying party
agrees that it shall be liable for any settlement of the nature contemplated by
Section 6(a)(iii) effected without its written consent if (i) such settlement is
entered into more than 45 days after receipt by such indemnifying party of the
aforesaid request, (ii) such indemnifying party shall have received notice of
the terms of such settlement at least 30 days prior to such settlement being
entered into and (iii) such indemnifying party shall not have reimbursed such
indemnified party in accordance with such request prior to the date of such
settlement.
SECTION 7. Contribution. If the indemnification provided for in Section
6 hereof is for any reason unavailable to or insufficient to hold harmless an
indemnified party in respect of any losses, liabilities, claims, damages or
expenses referred to therein, then each indemnifying party shall contribute to
the aggregate amount of such losses, liabilities, claims, damages and expenses
incurred by such indemnified party, as incurred, (i) in such proportion as is
appropriate to reflect the relative benefits received by the Company on the one
hand and the International Managers on the other hand from the offering of the
Securities and the Convertible Notes pursuant to this Agreement and the
Convertible Note Purchase Agreement or (ii) if the allocation provided by clause
(i) is not permitted by applicable law, in such proportion as is appropriate to
reflect not only the relative benefits referred to in clause (i) above but also
the relative fault of the Company on the one hand and of the International
Managers on the other hand in connection with the statements or omissions, which
resulted in such losses, liabilities, claims, damages or expenses, as well as
any other relevant equitable considerations.
The relative benefits received by the Company on the one hand and the
International Managers on the other hand in connection with the offering of the
International Securities pursuant to this Agreement shall be deemed to be in the
same respective proportions as the total net proceeds from the offering of the
International Securities pursuant to this Agreement (before deducting expenses)
received by the Company and the total underwriting discount and commissions
received by the International Managers, in each case as set forth on the cover
of the International Prospectus, or, if Rule 434 is used, the corresponding
location on the
25
Term Sheet, bear to the aggregate initial public offering price of the
International Securities as set forth on such cover.
The relative fault of the Company on the one hand and the International
Managers on the other hand shall be determined by reference to, among other
things, whether any such untrue or alleged untrue statement of a material fact
or omission or alleged omission to state a material fact relates to information
supplied by the Company or by the International Managers and the parties'
relative intent, knowledge, access to information and opportunity to correct or
prevent such statement or omission or any violation of the nature referred to in
Section 6(a)(ii)(A) hereof.
The Company and the International Managers agree that it would not be
just and equitable if contribution pursuant to this Section 7 were determined by
pro rata allocation (even if the International Managers were treated as one
entity for such purpose) or by any other method of allocation which does not
take account of the equitable considerations referred to above in this Section
7. The aggregate amount of losses, liabilities, claims, damages and expenses
incurred by an indemnified party and referred to above in this Section 7 shall
be deemed to include any legal or other expenses reasonably incurred by such
indemnified party in investigating, preparing or defending against any
litigation, or any investigation or proceeding by any governmental agency or
body, commenced or threatened, or any claim whatsoever based upon any such
untrue or alleged untrue statement or omission or alleged omission.
Notwithstanding the provisions of this Section 7, no International
Manager shall be required to contribute any amount in excess of the amount by
which the total price at which the International Securities underwritten by it
and distributed to the public were offered to the public exceeds the amount of
any damages which such International Manager has otherwise been required to pay
by reason of any such untrue or alleged untrue statement or omission or alleged
omission.
No person guilty of fraudulent misrepresentation (within the meaning of
Section 11(f) of the ▇▇▇▇ ▇▇▇) shall be entitled to contribution from any person
who was not guilty of such fraudulent misrepresentation.
For purposes of this Section 7, each person, if any, who controls
International Manager within the meaning of Section 15 of the 1933 Act or
Section 20 of the 1934 Act shall have the same rights to contribution as such
International Manager, and each director of the Company, each officer of the
Company who signed the Registration Statement, and each person, if any, who
controls the Company within the meaning of Section 15 of the 1933 Act or Section
20 of the 1934 Act shall have the same rights to contribution as the Company.
The
26
International Managers' respective obligations to contribute pursuant to this
Section 7 are several in proportion to the number of Initial International
Securities set forth opposite their respective names in Schedule A hereto and
not joint.
SECTION 8. Representations, Warranties and Agreements to Survive
Delivery. All representations, warranties and agreements contained in this
Agreement or in certificates of officers of the Company or any of its
Subsidiaries or its Material Holdings submitted pursuant hereto, shall remain
operative and in full force and effect, regardless of any investigation made by
or on behalf of any International Manager or controlling person, or by or on
behalf of the Company, and shall survive delivery of the Securities to the
International Managers.
SECTION 9. Termination of Agreement.
(a) Termination; General. The Lead Managers may terminate this
Agreement, by notice to the Company, at any time at or prior to Closing Time (i)
if there has been, since the time of execution of this Agreement or since the
respective dates as of which information is given in the International
Prospectus, any material adverse change in the condition, financial or
otherwise, or in the earnings, business affairs or business prospects of the
Company and its Subsidiaries considered as one enterprise, whether or not
arising in the ordinary course of business, or (ii) if there has occurred any
material adverse change in the financial markets in the United States or the
international financial markets, any outbreak of hostilities or escalation
thereof or other calamity or crisis or any change or development involving a
prospective change in national or international political, financial or economic
conditions, in each case the effect of which is such as to make it, in the
judgment of the Lead Managers, impracticable to market the Securities or to
enforce contracts for the sale of the Securities, or (iii) if trading in any
securities of the Company has been suspended or materially limited by the
Commission or the Nasdaq National Market, or if trading generally on the New
York Stock Exchange or in the Nasdaq National Market has been suspended or
materially limited, or minimum or maximum prices for trading have been fixed, or
maximum ranges for prices have been required, by any of said exchanges or by
such system or by order of the Commission, the National Association of
Securities Dealers, Inc. or any other governmental authority, or (iv) if a
banking moratorium has been declared by either Federal or New York authorities.
(b) Liabilities. If this Agreement is terminated pursuant to this
Section, such termination shall be without liability of any party to any other
party except as provided in Section 4 hereof, and provided further that Sections
1, 6, 7 and 8 shall survive such termination and remain in full force and
effect.
27
SECTION 10. Default by One or More of the International Managers. If one
or more of the International Managers shall fail at Closing Time or a Date of
Delivery to purchase the Securities which it or they are obligated to purchase
under this Agreement (the "Defaulted Securities"), the Lead Managers shall have
the right, within 24 hours thereafter, to make arrangements for one or more of
the non-defaulting International Managers, or any other underwriters, to
purchase all, but not less than all, of the Defaulted Securities in such amounts
as may be agreed upon and upon the terms herein set forth; if, however, the Lead
Managers shall not have completed such arrangements within such 24-hour period,
then:
(a) if the number of Defaulted Securities does not exceed 10% of the
number of International Securities to be purchased on such date, each of the
non-defaulting International Managers shall be obligated, severally and not
jointly, to purchase the full amount thereof in the proportions that their
respective underwriting obligations hereunder bear to the underwriting
obligations of all non-defaulting International Managers, or
(b) if the number of Defaulted Securities exceeds 10% of the number of
International Securities to be purchased on such date, this Agreement or, with
respect to any Date of Delivery which occurs after the Closing Time, the
obligation of the International Managers to purchase and of the Company to sell
the Option Securities to be purchased and sold on such Date of Delivery shall
terminate without liability on the part of any non-defaulting International
Manager.
No action taken pursuant to this Section shall relieve any defaulting
International Manager from liability in respect of its default.
In the event of any such default which does not result in a termination
of this Agreement or, in the case of a Date of Delivery which is after the
Closing Time, which does not result in a termination of the obligation of the
International Managers to purchase and the Company to sell the relevant
International Option Securities, as the case may be, either the Lead Managers or
the Company shall have the right to postpone Closing Time or the relevant Date
of Delivery, as the case may be, for a period not exceeding seven days in order
to effect any required changes in the Registration Statement or Prospectus or in
any other documents or arrangements. As used herein, the term "International
Manager" includes any person substituted for a International Manager under this
Section 10.
SECTION 11. Notices. All notices and other communications hereunder
shall be in writing and shall be deemed to have been duly given if mailed or
transmitted by any standard form of telecommunication. Notices to the
International Managers shall be directed to the Lead Managers at ▇▇▇▇▇ ▇▇▇▇▇,
▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇-▇▇▇▇, attention of ▇▇▇▇▇▇▇
28
▇▇▇▇▇▇▇, Esq.; and notices to the Company shall be directed to it at Building
800, ▇▇▇ ▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇, attention of ▇▇▇▇▇ ▇.
Nassau, Esq.
SECTION 12. Parties. This Agreement shall each inure to the benefit of
and be binding upon the International Managers and the Company and their
respective successors. Nothing expressed or mentioned in this Agreement is
intended or shall be construed to give any person, firm or corporation, other
than the International Managers and the Company and their respective successors
and the controlling persons and officers and directors referred to in Sections 6
and 7 and their heirs and legal representatives, any legal or equitable right,
remedy or claim under or in respect of this Agreement or any provision herein
contained. This Agreement and all conditions and provisions hereof are intended
to be for the sole and exclusive benefit of the International Managers and the
Company and their respective successors, and said controlling persons and
officers and directors and their heirs and legal representatives, and for the
benefit of no other person, firm or corporation. No purchaser of Securities from
any International Manager shall be deemed to be a successor by reason merely of
such purchase.
SECTION 13. GOVERNING LAW AND TIME. THIS AGREEMENT SHALL BE GOVERNED BY
AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK. SPECIFIED
TIMES OF DAY REFER TO NEW YORK CITY TIME.
SECTION 14. Effect of Headings. The Article and Section headings herein
and the Table of Contents are for convenience only and shall not affect the
construction hereof.
29
If the foregoing is in accordance with your understanding of our
agreement, please sign and return to the Company a counterpart hereof, whereupon
this instrument, along with all counterparts, will become a binding agreement
between the International Managers and the Company in accordance with its terms.
Very truly yours,
INTERNET CAPITAL GROUP,
INC.
By
------------------------------
Title:
CONFIRMED AND ACCEPTED,
as of the date first above written:
▇▇▇▇▇▇▇ ▇▇▇▇▇ INTERNATIONAL
▇▇▇▇▇▇▇ SACHS INTERNATIONAL
DEUTSCHE BANK AG LONDON
▇▇▇▇▇▇ BROTHERS INTERNATIONAL (EUROPE)
BANCBOSTON ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇ INTERNATIONAL LIMITED
By: ▇▇▇▇▇▇▇ ▇▇▇▇▇ INTERNATIONAL
By
---------------------------------------------
Authorized Signatory
For itself and as Lead Manager of the
other International Managers named in Schedule A hereto.
SCHEDULE A
Number of
Initial U.S.
Name of International Manager Securities
----------------------------- ------------
▇▇▇▇▇▇▇ ▇▇▇▇▇ International......................................
▇▇▇▇▇▇▇ Sachs International......................................
Deutsche Bank AG London..........................................
▇▇▇▇▇▇ Brothers International (Europe)...........................
BancBoston ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇ International Limited..............
Total
============
Sch A-1
SCHEDULE B
INTERNET CAPITAL GROUP, INC.
Shares of Common Stock
(Par Value $.001 Per Share)
The public offering price per share for the Securities, determined as
provided in said Section 2, shall be $ .
The purchase price per share for the International Securities to be paid
by the several International Managers shall be $ , being an amount equal to the
public offering price set forth above less $ per share; provided that the
purchase price per share for any International Option Securities purchased upon
the exercise of the over-allotment option described in Section 2(b) shall be
reduced by an amount per share equal to any dividends or distributions declared
by the Company and payable on the Initial International Securities but not
payable on the International Option Securities.
Sch B-1
Exhibit A
FORM OF OPINION OF DECHERT PRICE & ▇▇▇▇▇▇
TO BE DELIVERED PURSUANT TO SECTION 5(b)
The Company has been duly incorporated and is validly
existing as a corporation in good standing under the laws of
the State of Delaware.
The Company has corporate power and corporate authority to
own, lease and operate its properties and to conduct its
business as described in the Prospectuses and to enter into
and perform its obligations under the U.S. Purchase
Agreement, the International Purchase Agreement and the
Convertible Note Purchase Agreement.
The Company is duly qualified as a foreign corporation to
transact business and is in good standing in each of
Pennsylvania, Massachusetts and California.
The Company has authorized, issued and outstanding shares
of capital stock as set forth in the Prospectuses under the
caption "Capitalization" (except for subsequent issuances,
if any, pursuant to the U.S. Purchase Agreement and the
International Purchase Agreement or pursuant to
reservations, agreements or employee benefit plans referred
to in the Prospectuses or pursuant to the exercise of
convertible securities or options referred to in the
Prospectuses); the shares of issued and outstanding capital
stock have been duly authorized and validly issued and are
fully paid and non-assessable; and none of the outstanding
shares of capital stock of the Company was issued in
violation of the preemptive or other similar rights of any
securityholder of the Company.
The Securities and the Convertible Notes to be sold by the
Company have been duly authorized for issuance and sale
pursuant to the U.S. Purchase Agreement, the International
Purchase Agreement and the Convertible Note Purchase
Agreement, respectively, and, when issued and delivered by
the Company pursuant thereto, against payment of the
consideration set forth therein, will be validly issued and
fully paid and non-assessable and no holder of the
Securities or the
Ex. A-1
Convertible Notes is or will be subject to personal
liability by reason of being such a holder.
The issuance of the Securities and the Convertible Notes is
not subject to the preemptive or other similar rights of any
securityholder of the Company.
Each majority-owned subsidiary and Material Holding has been
duly incorporated and is validly existing as a corporation
in good standing under the laws of the jurisdiction of its
incorporation, has corporate power and corporate authority
to own, lease and operate its properties and to conduct its
business as described in the Prospectuses; except as
otherwise disclosed in the Registration Statement, the
issued and outstanding capital stock of each majority-owned
subsidiary or Material Holding owned by the Company has been
duly authorized and validly issued, is fully paid and
non-assessable and, to the best of our knowledge, is owned
by the Company, directly or through majority-owned
subsidiaries, free and clear of any security interest,
mortgage, pledge, lien, encumbrance, claim or equity other
than to the lenders under the revolving bank credit
facility; and none of the outstanding shares of capital
stock of any subsidiary or Material Holding owned by the
Company was issued in violation of the preemptive or similar
rights of any securityholder of each subsidiary or Material
Holding.
Each of the U.S. Purchase Agreement, the International
Purchase Agreement and the Convertible Note Purchase
Agreement has been duly authorized executed and delivered by
the Company.
The Registration Statement, including any Rule 462(b)
Registration Statement, has been declared effective under
the 1933 Act; any required filing of the Prospectuses
pursuant to Rule 424(b) has been made in the manner and
within the time period required by Rule 424(b); and, to the
best of our knowledge, no stop order suspending the
effectiveness of the Registration Statement or any Rule
462(b) Registration Statement has been issued under the 1933
Act and no proceedings for that purpose have been instituted
or are pending or threatened by the Commission.
Ex. A-2
The Registration Statement, including any Rule 462(b)
Registration Statement, the Rule 430A Information and the
Rule 434 Information, as applicable, the Prospectuses and
each amendment or supplement to the Registration Statement
and the Prospectuses as of their respective effective or
issue dates (other than the financial statements, supporting
schedules and other financial data included therein or
omitted therefrom, as to which we need express no opinion)
complied as to form in all material respects with the
requirements of the 1933 Act and the 1933 Act Regulations.
The form of certificate used to evidence the Common Stock
complies in all material respects with all applicable
statutory requirements, with any applicable requirements of
the Certificate of Incorporation and by-laws of the Company
and the requirements of the Nasdaq National Market.
To our knowledge, there is not pending or threatened any
action, suit, proceeding, inquiry or investigation, to which
the Company or any majority-owned subsidiary is a party, or
to which the property of the Company or any majority-owned
subsidiary is subject, before or brought by any court or
governmental agency or body, domestic or foreign, which
might reasonably be expected to result in a Material Adverse
Effect with respect to the Company, or which might
reasonably be expected to materially and adversely affect
the properties or assets thereof or the consummation of the
transactions contemplated in the U.S. Purchase Agreement,
International Purchase Agreement and the Convertible Note
Purchase Agreement or the performance by the Company of its
obligations thereunder.
The information in the Prospectuses and in the Registration
Statement to the extent that it constitutes matters of law,
summaries of legal matters, the Company's Certificate of
Incorporation and bylaws or legal proceedings, or legal
conclusions, has been reviewed by us and is correct in all
material respects.
To our knowledge, there are no statutes or regulations that
are required to be described in the Prospectuses that are
not described as required.
Ex. A-3
All descriptions in the Prospectuses of contracts and other
documents to which the Company, its majority-owned
subsidiaries or its Material Holdings are a party are
accurate in all material respects; to our knowledge, there
are no franchises, contracts, indentures, mortgages, loan
agreements, notes, leases or other instruments required to
be described or referred to in the Registration Statement or
to be filed as exhibits thereto other than those described
or referred to therein or filed or incorporated by reference
as exhibits thereto, and the descriptions thereof or
references thereto are correct in all material respects.
To our knowledge, neither the Company nor any of its
majority-owned subsidiaries nor any Material Holdings is in
violation of its charter or by-laws and no default by the
Company or any majority-owned subsidiary or Material Holding
exists in the due performance or observance of any material
obligation, agreement, covenant or condition contained in
any contract, indenture, mortgage, loan agreement, note,
lease or other agreement or instrument that is described or
referred to in the Registration Statement or the
Prospectuses or filed or incorporated by reference as an
exhibit to the Registration Statement.
No filing with, or authorization, approval, consent,
license, order, registration, qualification or decree of,
any court or governmental authority or agency, domestic or
foreign (other than under the 1933 Act and the 1933 Act
Regulations, which have been obtained, or as may be required
under the securities or blue sky laws of the various states,
as to which we need express no opinion) is necessary or
required in connection with the due authorization, execution
and delivery of the U.S. Purchase Agreement, the
International Purchase Agreement and the Convertible Note
Purchase Agreement or for the offering, issuance, sale or
delivery of the Securities.
The execution, delivery and performance of the U.S. Purchase
Agreement, the International Purchase Agreement and the
Convertible Note Purchase Agreement and the consummation of
the transactions contemplated therein and in the
Registration Statement (including the issuance and sale of
the Securities, and the use of the proceeds from the sale of
the Securities as described in the Prospectuses under the
caption
Ex. A-4
"Use Of Proceeds") and compliance by the Company with its
obligations thereunder do not and will not, whether with or
without the giving of notice or lapse of time or both,
conflict with or constitute a breach of, or default or
Repayment Event (as defined in Section 1(a)(x) of the
Purchase Agreements) under or result in the creation or
imposition of any lien, charge or encumbrance upon any
property or assets of the Company or any of its majority-
owned subsidiaries or Material Holdings pursuant to any
contract, indenture, mortgage, deed of trust, loan or credit
agreement, note, lease or any other agreement or instrument,
known to us, to which the Company or any of its majority-
owned subsidiaries or Material Holdings is a party or by
which it or any of them may be bound, or to which any of the
property or assets of the Company or any of its majority-
owned subsidiaries or Material Holdings is subject (except
for such conflicts, breaches or defaults or liens, charges
or encumbrances that would not have a Material Adverse
Effect), nor will such action result in any violation of the
provisions of the charter or by-laws of the Company or any
of its majority-owned subsidiaries or Material Holdings or
any applicable law, statute, rule, regulation, judgment,
order, writ or decree, known to us, of any government,
government instrumentality or court, domestic or foreign,
having jurisdiction over the Company or any majority-owned
subsidiary or Material Holding or any of their respective
properties, assets or operations.
To the best of our knowledge, other than rights that have
been waived, there are no persons with registration rights
or other similar rights to have any securities registered
pursuant to the Registration Statement or otherwise
registered by the Company under the 1933 Act, except as
disclosed in the Registration Statement.
To our knowledge, there are no pending or threatened claims of
infringement of any material patent, trademark, service ▇▇▇▇ or copyright or of
misappropriation of trade secrets, necessary for the Company to conduct the
business currently conducted by it, the unfavorable outcome of which could
reasonably be expected to have a material adverse effect on the Company and that
are required to be described in the Registration Statement or the Prospectus but
are not described as required.
Ex.A-5
We have no knowledge that the Company will be unable to operate under
any current license of a patent, trademark, service ▇▇▇▇, copyright or trade
secret, which license is necessary for the Company to conduct the business
currently conducted by it.
Nothing has come to our attention that would lead us to believe that the
Registration Statement or any amendment thereto, including the Rule 430A
Information and Rule 434 Information (if applicable), (except for financial
statements and schedules and other financial data included therein or omitted
therefrom, as to which we need make no statement), at the time such Registration
Statement or any such amendment became effective, contained an untrue statement
of a material fact or omitted to state a material fact required to be stated
therein or necessary to make the statements therein not misleading or that the
Prospectuses or any amendment or supplement thereto (except for financial
statements and schedules and other financial data included therein or omitted
therefrom, as to which we need make no statement), at the time the Prospectuses
were issued, at the time any such amended or supplemented prospectus was issued
or at the Closing Time, included or includes an untrue statement of a material
fact or omitted or omits to state a material fact necessary in order to make the
statements therein, in the light of the circumstances under which they were
made, not misleading.
In rendering such opinion, such counsel may rely as to matters of fact
(but not as to legal conclusions), to the extent they deem proper, on
certificates of responsible officers of the Company and public officials.
Ex. A-6
Exhibit B
FORM OF OPINION OF ▇▇▇▇▇ ▇▇▇▇ & ▇▇▇▇▇▇▇▇
TO BE DELIVERED PURSUANT TO
SECTION 5(b)
(i) The Company is not, and upon the issuance and sale of the Securities
and the Convertible Notes and the application of the net proceeds therefrom as
described in the Prospectuses will not be, required to register as an
"investment company" under the Investment Company Act of 1940, as amended.
Ex. B-1
[Form of lock-up from directors, officers or
other stockholders pursuant to Section 5(i)]
▇▇▇▇▇▇▇ ▇
, ▇▇▇▇
▇▇▇▇▇▇▇ ▇▇▇▇▇ & CO.
▇▇▇▇▇▇▇ Lynch, Pierce, ▇▇▇▇▇▇ & ▇▇▇▇▇
Incorporated,
▇▇▇▇▇▇▇, Sachs & Co.
Deutsche Bank Securities Inc.
BancBoston ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇ Inc.
▇▇▇▇▇▇ Brothers Inc.
as U.S. Representatives of the several
U.S. Underwriters to be named in the
within-mentioned U.S. Purchase Agreement
▇/▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇ & ▇▇.
▇▇▇▇▇▇▇ Lynch, Pierce, ▇▇▇▇▇▇ & ▇▇▇▇▇
Incorporated
▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇-▇▇▇▇
Re: Proposed Public Offering by Internet Capital Group, Inc.
--------------------------------------------------------
Dear Sirs:
The undersigned, a stockholder, officer or director of Internet Capital
Group, Inc., a Delaware corporation (the "Company"), understands that ▇▇▇▇▇▇▇
▇▇▇▇▇ & Co., ▇▇▇▇▇▇▇ Lynch, Pierce, ▇▇▇▇▇▇ & ▇▇▇▇▇ Incorporated ("▇▇▇▇▇▇▇
▇▇▇▇▇"), ▇▇▇▇▇▇▇, ▇▇▇▇▇ & Co., Deutsche Bank Securities Inc., ▇▇▇▇▇▇ Brothers
Inc. and BancBoston ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇ Inc. propose to enter into a U.S.
Purchase Agreement (the "U.S. Purchase Agreement") with the Company providing
for the public offering of shares (the "Securities") of the Company's common
stock, par value $.001 per share (the "Common Stock"). In recognition of the
benefit that such an offering will confer upon the undersigned as a stockholder,
officer or director of the Company, and for other good and valuable
consideration, the receipt and sufficiency of which are hereby acknowledged, the
undersigned agrees with each underwriter to be named in the U.S. Purchase
Agreement that, during a period of 180 days from the date of the U.S. Purchase
Agreement, the undersigned will not, without the prior written consent of
▇▇▇▇▇▇▇ ▇▇▇▇▇, directly or indirectly, (i) offer, pledge, sell, contract to
sell, sell any option or contract to purchase, purchase any
Ex. C-1
option or contract to sell, grant any option, right or warrant for the sale of,
or otherwise dispose of or transfer any shares of the Company's Common Stock or
any securities convertible into or exchangeable or exercisable for Common Stock,
whether now owned or hereafter acquired by the undersigned or with respect to
which the undersigned has or hereafter acquires the power of disposition, or
file any registration statement under the Securities Act of 1933, as amended,
with respect to any of the foregoing or (ii) enter into any swap or any other
agreement or any transaction that transfers, in whole or in part, directly or
indirectly, the economic consequence of ownership of the Common Stock, whether
any such swap or transaction is to be settled by delivery of Common Stock or
other securities, in cash or otherwise.
Very truly yours,
[insert name of beneficial owner
of shares/officer/director]
by:
-------------------------------
Name: [insert name of signatory]
Title: [if signing on before of
a corporation, insert title]
Ex. C-2