SHARE PURCHASE AGREEMENT
THIS SHARE PURCHASE AGREEMENT ("Agreement"), made and entered into as
of the 7th day of July, 1999, by and between THE COBALT GROUP, INC., a
Washington corporation ("the Company") and GE Financial Assurance Holdings,
Inc., a Delaware corporation ("Purchaser");
WHEREAS, pursuant to the terms of the underwriting agreement of even
date herewith (the "Underwriting Agreement") between and among the Company and
BancBoston ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇, Bear, ▇▇▇▇▇▇▇ & Co. Inc., ▇▇ ▇▇▇▇▇ and Wit
Capital Corporation (the "Underwriters"), the Company has agreed to issue, sell
and deliver to the Underwriters, and the Underwriters have agreed to purchase
and receive from the Company, in connection with a firm commitment underwritten
public offering of the common stock of the Company (the "Common Stock")
4,500,000 shares of Common Stock (plus up to 675,000 shares of Common Stock
subject to an over-allotment option granted to the Underwriters with respect to
the offering (the "Over-allotment Shares")) (such Shares, including the Over-
allotment Shares, are hereinafter referred to as the "Public Offering Shares");
and
WHEREAS, the Company desires to issue, sell and deliver to Purchaser,
and Purchaser desires to purchase and receive directly from the Company
concurrently with consummation of the purchase by the Underwriters of the Public
Offering Shares (excluding the Over-allotment Shares), $5,000,000 in aggregate
amount of Common Stock to be purchased at the Purchase Price (as defined in
Article 1 below), upon the terms, provisions and conditions contained herein
(such shares purchased by the Purchaser are hereinafter referred to as the
"Purchased Shares");
NOW, THEREFORE, in consideration of the premises and the mutual
covenants and agreements contained herein, the Company and Purchaser hereby
agree as follows:
ARTICLE 1.
SALE AND PURCHASE OF SHARES
The Company hereby agrees to issue, sell and deliver to Purchaser, and
Purchaser hereby agrees to purchase and receive from the Company, at Closing (as
defined in Section 6.1 below), the Purchased Shares. The aggregate purchase
price for the Purchased Shares shall be $5,000,000. The per share purchase
price for the Purchased
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Shares shall be the per share price at which the Public Offering Shares are
initially offered to the public by the Underwriters, as set forth in the
Prospectus included in the Registration Statement described in Section 4.2
below (the "Purchase Price"); provided, however, that if the per share price
of the Public Offering Shares as initially offered to the public by the
Underwriters is above $16, Purchaser shall have the option, but not the
obligation, to purchase the Purchased Shares. If the per share price is above
$16, Purchaser shall have the option to terminate this Agreement.
ARTICLE 2.
REPRESENTATIONS AND WARRANTIES OF THE COMPANY
The Company hereby represents and warrants to Purchaser that:
2.1 CORPORATE STATUS. The Company has been duly incorporated and is an
existing corporation under Washington law, has paid all fees and filed all
documents required under Washington law to maintain its corporate existence, has
full corporate power and authority to conduct its business as the same is now
being conducted and to own its properties as the same are now owned.
2.2 CAPITAL STOCK; PURCHASED SHARES. The capital stock of the Company is
as set forth in the Prospectus. Upon the purchase by Purchaser of the Purchased
Shares in accordance with the terms of this Agreement, the Purchased Shares will
be validly issued, fully paid and nonassessable.
2.3 AUTHORITY. This Agreement has been duly executed and delivered by the
Company and constitutes a valid and binding obligation of the Company,
enforceable in accordance with its terms subject, as to enforceability, to
bankruptcy, insolvency, reorganization and other laws of general applicability
relating to or affecting creditors' rights and to general equity principles.
The execution and delivery of this Agreement and the Underwriting Agreement and
the consummation of the transactions contemplated hereby and thereby have been
duly and validly authorized by all necessary corporate action on the part of the
Company, and the Company has full corporate power and authority to execute and
deliver this Agreement and the Underwriting Agreement and to perform its
obligations hereunder and thereunder.
2.4 BROKERS. The Company has not retained or employed any broker, agent
or finder or paid or agreed to pay any brokerage fee, finder's fee, commission
or other similar payment to any broker, agent, or finder on account of this
Agreement or any matters contemplated hereby; except that the Underwriters have
been engaged by the Company in
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connection with the offering of the Public Offering Shares. The Company shall
indemnify and hold Purchaser harmless from any and all fees, discounts,
commissions and expenses of the Underwriters in connection with the offering
of the Public Offering Shares and these Purchased Shares.
2.5 NO CONFLICT. The execution and delivery by the Company of, and the
performance by the Company of its obligations under, this Agreement and the
Underwriting Agreement will not contravene any provision of applicable law or
the Articles of Incorporation or Bylaws of the Company, or any agreement or
other instrument binding upon the Company, and no consent, approval or
authorization of any governmental body or agency is required for the performance
by the Company of its obligations under this Agreement or the Underwriting
Agreement, except such as are specified herein and therein and have been
obtained and such as may be required by the 1933 Act and the securities or Blue
Sky laws of the various states in connection with the purchase and distribution
by the Underwriters of the Public Offering Shares.
2.6 COMPLIANCE WITH SECURITIES LAWS. The Registration Statement and
Prospectus comply in all material respects with the 1933 Act and the rules and
regulations of the Commission thereunder and do not contain any untrue statement
of a material fact or omit to state any material fact required to be stated
therein or necessary to make the statements therein not misleading.
ARTICLE 3.
REPRESENTATIONS AND WARRANTIES OF
PURCHASER
3.1 CORPORATE STATUS. Purchaser has been duly organized and is validly
existing as a corporation in good standing under the laws of Delaware, with full
corporate power to conduct its business as the same is now being conducted and
to own its properties as the same are now owned.
3.2 AUTHORITY. This Agreement has been duly executed and delivered by
Purchaser and constitutes a valid and binding obligation of Purchaser
enforceable in accordance with its terms subject, as to enforceability, to
bankruptcy, insolvency, reorganization and other laws of general applicability
relating to or affecting creditors' rights and to general equity principles.
The execution and delivery of this Agreement and the consummation of the
transactions contemplated hereby have been duly and validly authorized by all
necessary corporate action on the part of Purchaser, and Purchaser has full
corporate power and authority to execute and deliver this Agreement and to
perform its obligations hereunder.
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3.3 BROKERS. Purchaser has not retained or employed any broker, agent or
finder or paid or agreed to pay any brokerage fee, finder's fee, commission or
other similar payment to any broker, agent or finder on account of this
Agreement or any matters contemplated hereby.
ARTICLE 4.
COVENANTS
4.1 DISPOSITION OF THE PURCHASED SHARES. Purchaser further agrees that
for a period of 180 days from the Closing Date set forth in Section 6.1 below,
it will not directly or indirectly offer, sell, contract to sell, grant any
option to purchase, pledge, hypothecate or otherwise transfer or dispose of any
of the Purchased Shares other than to its affiliates or other intra-organization
transferees who also agree to be bound by such lock-up agreement, without the
prior written consent of BancBoston ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇.
4.2 REGISTRATION OF COMMON STOCK. The Company covenants and agrees to use
its best efforts to register the Public Offering Shares and the Purchased Shares
under the Securities Act of 1933, as amended (the "1933 Act"), pursuant to a
Registration Statement on Form S-1 (No. 333-79483) filed with the Securities and
Exchange Commission (the "Commission") on May 27, 1999, as amended. The Company
shall provide Purchaser with a copy of the final prospectus included as a part
of the Registration Statement at the time such Registration Statement is
declared effective ("Prospectus").
ARTICLE 5.
CONDITIONS
5.1 CONDITIONS TO THE OBLIGATIONS OF THE COMPANY. The obligation of the
Company to consummate the transaction contemplated by Article 1 is subject to
the satisfaction and fulfillment, prior to or at Closing, of each of the
following conditions:
(a) REPRESENTATIONS AND WARRANTIES. The representations and
warranties of Purchaser set forth herein shall be true and correct in all
material respects on the Closing Date as though such representation and
warranties were made on such date.
(b) PERFORMANCE OF OBLIGATIONS. Purchaser shall have performed and
complied with all agreements, covenants and conditions required by this
Agreement to be performed or complied with by it prior to or at Closing.
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(c) PURCHASE AND SALE OF PUBLIC OFFERING SHARES. The Underwriters
and the Company shall have executed and delivered the Underwriting
Agreement and the Underwriters shall have purchased the Public Offering
Shares, pursuant to and in accordance with the terms of the Underwriting
Agreement.
(d) PURCHASE PRICE. The Company shall have received from Purchaser,
in payment for the Purchased Shares, $5,000,000 in immediately available
funds.
(e) NO TERMINATION. This Agreement shall not have been terminated in
accordance with its terms.
(f) REGISTRATION OF COMMON STOCK. The Public Offering Shares and the
Purchased Shares shall have been registered under the 1933 Act pursuant to
a Registration Statement on Form S-1 (No. 333-79483) filed with the
Commission on May 27, 1999, as amended. No stop order suspending the
effectiveness of the Registration Statement shall be in effect, and no
proceedings for such purpose shall be pending before or threatened by the
Commission, and there shall have been no material adverse change in the
condition of the Company from that set forth in the Registration Statement.
5.2 CONDITIONS TO OBLIGATIONS OF PURCHASER. The obligation of Purchaser
to consummate the transaction contemplated by Article 1 is subject to the
satisfaction and fulfillment, prior to or at Closing, of each of the following
conditions:
(a) REPRESENTATIONS AND WARRANTIES. The representations and
warranties of the Company set forth herein shall be true and correct in all
material respects on the Closing Date as though such representations and
warranties were made on such date.
(b) PERFORMANCE OF OBLIGATIONS. The Company shall have performed and
complied with all agreements, covenants and conditions required by this
Agreement to be performed or complied with by it prior to or at Closing.
(c) PURCHASE AND SALE OF PUBLIC OFFERING SHARES. The Underwriters
and the Company shall have executed and delivered the Underwriting
Agreement and the Underwriters shall have purchased the Public Offering
Shares, pursuant to and in accordance with the terms of the Underwriting
Agreement.
(d) PURCHASED SHARES. Purchaser shall have received a certificate or
certificates representing the Purchased Shares duly and validly issued in
the name of Purchaser or its designee.
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(e) NO TERMINATION. This Agreement shall not have been terminated in
accordance with its terms.
(f) REGISTRATION OF COMMON STOCK. The Public Offering Shares and the
Purchased Shares shall have been registered under the 1933 Act, pursuant to
a Registration Statement on Form S-1 (No. 333-79483) filed with the
Commission on May 27, 1999, as amended. No stop order suspending the
effectiveness of the Registration Statement shall be in effect, and no
proceedings for such purpose shall be pending before or threatened by the
Commission, and there shall have been no material adverse change in the
condition of the Company from that set forth in the Registration Statement.
ARTICLE 6.
THE CLOSING; TERMINATION
6.1 CLOSING. Unless this Agreement has been terminated in accordance with
its terms, the closing of the transaction contemplated by Article 1 (the
"Closing") shall take place at the offices of Stoel Rives LLP, Seattle,
Washington, on the closing date for the sale of the Public Offering Shares, as
provided in the Underwriting Agreement, or at such other place or on such other
date as the parties hereto shall mutually agree in writing (the date of the
Closing is herein referred to as the "Closing Date").
6.2 ACTIONS TO BE TAKEN AT CLOSING. At Closing, the Company shall deliver
to Purchaser the certificate or certificates representing the Purchased Shares,
duly and validly issued in the name of Purchaser or its designee, and Purchaser
shall deliver to the Company, in payment for the Purchased Shares, $5,000,000 in
immediately available funds. In addition, the parties hereto shall execute and
cause to be delivered all other documents and items required to be delivered at
Closing or necessary to perform or satisfy any covenant, condition or agreement
contained herein which is required to be performed or satisfied at or prior to
Closing.
6.3 TERMINATION. This Agreement may be terminated by the Purchaser in
accordance with Article 1 or at any time by mutual agreement of the parties.
This Agreement will terminate if the Closing does not occur within 180 days of
the date hereof.
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ARTICLE 7.
MISCELLANEOUS
7.1 SURVIVAL OF REPRESENTATIONS, WARRANTIES AND AGREEMENTS. The
respective representations, warranties, agreements, covenants and obligations of
the parties hereunder shall survive the consummation of the transaction
contemplated by Article 1.
7.2 ENTIRE AGREEMENT. This Agreement constitutes the entire agreement
between the parties relating to the subject matter hereof and supersedes all
prior agreements and understandings, whether oral or written, between the
parties with respect to the same. No modification, alteration, amendment or
rescission of or supplement to this Agreement shall be valid or effective unless
the same is in writing and signed by the parties.
7.3 SEVERABILITY. The invalidity of any portion of this Agreement under
the applicable laws of the State of Washington or any other jurisdiction,
federal or state, shall not affect the force and effect of the remaining valid
portions hereof.
7.4 SUCCESSORS AND ASSIGNS. This Agreement shall inure to the benefit of
and be binding upon the parties and their respective successors and assigns.
7.5 HEADINGS. Articles and section headings used herein have been
inserted for convenience only and shall not affect the express provisions of
this Agreement or the construction hereof. Whenever reference is made herein to
a particular article, section or paragraph, such reference shall refer to the
designated article, section or paragraph of this Agreement.
7.6 NOTICES. Any notice required to be sent hereunder by either party
shall in every case mean written notice, which shall be delivered in person or
by registered or certified first class mail, return receipt requested, or by
prepaid telegram or telex, to the address of the other party hereto as set forth
below, and the same shall be effective as of the date such notice is received by
the party to whom it is sent:
If to the Company, to:
The Cobalt Group, Inc.
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Attn: ▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
With a copy to:
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Stoel Rives LLP
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▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Attn: ▇▇▇▇▇▇ ▇. Lone, Esq.
If to Purchaser, to:
GE Financial Assurance Holdings, Inc.
__________________________
__________________________
__________________________
With a copy to:
A. ▇▇▇▇▇ ▇▇▇▇▇▇▇
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Either party hereto may change the address to which any notice hereunder is to
be sent by giving notice of such change of address in accordance with the
provisions of this Section 7.6.
7.7 GOVERNING LAW. This Agreement and the rights and the duties of the
parties hereunder shall be governed by and construed and enforced in accordance
with the laws of the State of Washington.
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IN WITNESS WHEREOF, the parties have executed this Agreement as of the
date first written above.
GE FINANCIAL ASSURANCE THE COBALT GROUP, INC.
HOLDINGS, INC.
By_____________________________ By_________________________________
Name:__________________________ Name: _____________________________
Title: _________________________ Title: ______________________________
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