UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
SCHEDULE 13D/A
(RULE 13D-101)
INFORMATION TO BE INCLUDED IN STATEMENTS FILED PURSUANT TO
RULE 13D-1(A) AND AMENDMENTS THERETO FILED
PURSUANT TO RULE 13D-2(A).
(AMENDMENT NO. 2)*
FIRST VIRTUAL HOLDINGS INCORPORATED
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(Name of Issuer)
COMMON STOCK, PAR VALUE $0.001 PER SHARE
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(Title of Class of Securities)
337486 10 4
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(CUSIP Number)
RONALD FISHER STEPHEN A. GRANT, ESQ.
SOFTBANK HOLDINGS INC. SULLIVAN & CROMWELL
10 LANGLEY ROAD, SUITE 403 125 BROAD STREET
NEWTON CENTER, MA 02159 NEW YORK, NY 10004
(617) 928-9300 (212) 558-4000
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(Name, Address and Telephone Number of Person Authorized to Receive
Notices and Communications)
JUNE 12, 1998
-------------------------------------
(Date of Event which Requires Filing of this Statement)
(Continued on following pages)
(Page 1 of 10 Pages)
If the filing person has previously filed a statement on Schedule 13G to report
the acquisition which is the subject of this Schedule 13D, and is filing this
schedule because of Rule 13d-1(e), 13d-1(f) or 13d-1(g), check the following box
|_|.
NOTE: Schedules filed in paper format shall include a signed original and five
copies of the schedule, including all exhibits. See Rule 13d-7(b) for other
parties to whom copies are to be sent.
*The remainder of this cover page shall be filled out for a reporting person's
initial filing on this form with respect to the subject class of securities, and
for any subsequent amendment containing information which would alter
disclosures provided in a prior cover page.
The information required on the remainder of this cover page shall not be deemed
to be "filed" for the purpose of Section 18 of the Securities Exchange Act of
1934 (the "Act") or otherwise subject to the liabilities of that section of the
Act but shall be subject to all other provisions of the Act (however, see the
Notes). SEC 1746(12-91)
<PAGE>
SCHEDULE 13D
CUSIP NO. 337486 10 4 PAGE 2 OF 10 PAGES
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1 NAMES OF REPORTING PERSONS
I.R.S. IDENTIFICATION NOS. OF ABOVE PERSONS
SOFTBANK HOLDINGS INC.
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2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP* (A) |_|
(B) |_|
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3 SEC USE ONLY
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4 SOURCE OF FUNDS*
WC
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5 CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT
TO ITEMS 2(d) OR 2(e) |_|
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6 CITIZENSHIP OR PLACE OF ORGANIZATION
DELAWARE
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NUMBER OF 7 SOLE VOTING POWER
SHARES
BENEFICIALLY 20,326,213(1)(2)
OWNED BY ---------------------------------------------------------------
EACH 8 SHARED VOTING POWER
REPORTING
PERSON 4,979,611(2)
WITH ---------------------------------------------------------------
9 SOLE DISPOSITIVE POWER
20,326,213(1)(2)
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10 SHARED DISPOSITIVE POWER
0
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11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
25,305,824(1)(2)
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12 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES* |_|
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13 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
81.9%(1)(2)
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14 TYPE OF REPORTING PERSON*
CO
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(1) Such number of shares and percentage are estimated and are subject to
increase as described in Item 5.
(2) See Item 5.
*SEE INSTRUCTIONS BEFORE FILLING OUT!
INCLUDE BOTH SIDES OF THE COVER PAGE, RESPONSES TO ITEMS 1-7
(INCLUDING EXHIBITS) OF THE SCHEDULE, AND THE SIGNATURE ATTESTATION.
SCHEDULE 13D
<PAGE>
SCHEDULE 13D
CUSIP NO. 337486 10 4 PAGE 3 OF 10 PAGES
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1 NAMES OF REPORTING PERSONS
I.R.S. IDENTIFICATION NOS. OF ABOVE PERSONS
SOFTBANK TECHNOLOGY VENTURES IV L.P.
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2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP* (A) |_|
(B) |_|
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3 SEC USE ONLY
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4 SOURCE OF FUNDS*
WC
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5 CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT
TO ITEMS 2(d) OR 2(e) |_|
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6 CITIZENSHIP OR PLACE OF ORGANIZATION
DELAWARE
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NUMBER OF 7 SOLE VOTING POWER
SHARES
BENEFICIALLY 8,286,892(1)
OWNED BY ---------------------------------------------------------------
EACH 8 SHARED VOTING POWER
REPORTING
PERSON 4,979,611(1)
WITH ---------------------------------------------------------------
9 SOLE DISPOSITIVE POWER
8,286,892(1)
---------------------------------------------------------------
10 SHARED DISPOSITIVE POWER
0
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11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
13,266,503(1)
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12 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES* |_|
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13 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
66.1%
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14 TYPE OF REPORTING PERSON*
PN
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(1) See Item 5.
*SEE INSTRUCTIONS BEFORE FILLING OUT!
INCLUDE BOTH SIDES OF THE COVER PAGE, RESPONSES TO ITEMS 1-7
(INCLUDING EXHIBITS) OF THE SCHEDULE, AND THE SIGNATURE ATTESTATION.
<PAGE>
SCHEDULE 13D
CUSIP NO. 337486 10 4 PAGE 4 OF 10 PAGES
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1 NAMES OF REPORTING PERSONS
I.R.S. IDENTIFICATION NOS. OF ABOVE PERSONS
SOFTBANK CORPORATION
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2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP* (A) |_|
(B) |_|
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3 SEC USE ONLY
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4 SOURCE OF FUNDS*
AF
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5 CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT
TO ITEMS 2(d) OR 2(e) |_|
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6 CITIZENSHIP OR PLACE OF ORGANIZATION
JAPAN
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NUMBER OF 7 SOLE VOTING POWER
SHARES
BENEFICIALLY 20,326,213(1)(2)
OWNED BY ---------------------------------------------------------------
EACH 8 SHARED VOTING POWER
REPORTING
PERSON 4,979,611(2)
WITH ---------------------------------------------------------------
9 SOLE DISPOSITIVE POWER
20,326,213(1)(2)
---------------------------------------------------------------
10 SHARED DISPOSITIVE POWER
0
---------------------------------------------------------------
11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
25,305,824(1)(2)
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12 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES* |_|
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13 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
81.9%(1)(2)
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14 TYPE OF REPORTING PERSON*
HC, CO
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(1) Such number of shares and percentage are estimated and are subject to
increase as described in item 5.
(2) See Item 5.
*SEE INSTRUCTIONS BEFORE FILLING OUT!
INCLUDE BOTH SIDES OF THE COVER PAGE, RESPONSES TO ITEMS 1-7
(INCLUDING EXHIBITS) OF THE SCHEDULE, AND THE SIGNATURE ATTESTATION.
<PAGE>
SCHEDULE 13D
CUSIP NO. 337486 10 4 PAGE 5 OF 10 PAGES
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1 NAMES OF REPORTING PERSONS
I.R.S. IDENTIFICATION NOS. OF ABOVE PERSONS
MASAYOSHI SON
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2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP* (A) |_|
(B) |_|
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3 SEC USE ONLY
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4 SOURCE OF FUNDS*
AF
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5 CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT
TO ITEMS 2(d) OR 2(e) |_|
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6 CITIZENSHIP OR PLACE OF ORGANIZATION
JAPAN
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NUMBER OF 7 SOLE VOTING POWER
SHARES
BENEFICIALLY 20,326,213(1)(2)
OWNED BY ---------------------------------------------------------------
EACH 8 SHARED VOTING POWER
REPORTING
PERSON 4,979,611(2)
WITH ---------------------------------------------------------------
9 SOLE DISPOSITIVE POWER
20,326,213(1)(2)
---------------------------------------------------------------
10 SHARED DISPOSITIVE POWER
0
---------------------------------------------------------------
11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
25,305,824(1)(2)
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12 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES* |_|
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13 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
81.9%(1)(2)
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14 TYPE OF REPORTING PERSON*
IN
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(1) Such number of shares and percentage are estimated and are subject to
increase as described in Item 5.
(2) See Item 5.
*SEE INSTRUCTIONS BEFORE FILLING OUT!
INCLUDE BOTH SIDES OF THE COVER PAGE, RESPONSES TO ITEMS 1-7
(INCLUDING EXHIBITS) OF THE SCHEDULE, AND THE SIGNATURE ATTESTATION.
<PAGE>
SCHEDULE 13D
CUSIP NO. 337486 10 4 PAGE 6 OF 10 PAGES
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1 NAMES OF REPORTING PERSONS
I.R.S. IDENTIFICATION NOS. OF ABOVE PERSONS
STV IV LLC
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2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP* (A) |_|
(B) |_|
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3 SEC USE ONLY
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4 SOURCE OF FUNDS*
AF
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5 CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT
TO ITEMS 2(d) OR 2(e) |_|
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6 CITIZENSHIP OR PLACE OF ORGANIZATION
DELAWARE
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NUMBER OF 7 SOLE VOTING POWER
SHARES
BENEFICIALLY 8,286,892(1)
OWNED BY ---------------------------------------------------------------
EACH 8 SHARED VOTING POWER
REPORTING
PERSON 4,979,611(1)
WITH ---------------------------------------------------------------
9 SOLE DISPOSITIVE POWER
8,286,892(1)
---------------------------------------------------------------
10 SHARED DISPOSITIVE POWER
0
---------------------------------------------------------------
11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
13,266,503(1)
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12 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES* |_|
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13 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
66.1%(1)
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14 TYPE OF REPORTING PERSON*
OO
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(1) See Item 5.
*SEE INSTRUCTIONS BEFORE FILLING OUT!
INCLUDE BOTH SIDES OF THE COVER PAGE, RESPONSES TO ITEMS 1-7
(INCLUDING EXHIBITS) OF THE SCHEDULE, AND THE SIGNATURE ATTESTATION.
<PAGE>
CUSIP NO. 337486 10 4 PAGE 7 OF 10 PAGES
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SOFTBANK Holdings, SOFTBANK Technology, SOFTBANK, Son, and STV hereby
amend and supplement the Statement on Schedule 13D originally filed by the
Reporting Persons on May 11, 1998, as amended on June 4, 1998 (as amended, the
"Statement"), with respect to the Common Stock, par value $0.001 per share (the
"Common Stock"), of First Virtual Holdings Incorporated, a Delaware corporation
(the "Company").
The descriptions contained herein of certain agreements and documents
are qualified in their entirety by reference to the complete texts of such
agreements and documents, which have been filed as exhibits to the Schedule 13D,
as amended and supplemented, and incorporated by reference herein. Capitalized
terms used, but not defined, herein shall have the meanings ascribed to them in
the Statement.
ITEM 4. PURPOSE OF TRANSACTION.
Item 4 is hereby amended and supplemented by incorporation of the
information set forth in Item 6 with respect to the Supplementary Purchase
Agreement (as defined herein).
ITEM 5. INTEREST IN SECURITIES OF THE ISSUER.
Item 5 is hereby amended and restated as follows:
(a) and (b). SOFTBANK Technology.
SOFTBANK Technology may be deemed to be the beneficial owner of
8,286,892 shares of Common Stock consisting of (i) 5,000,000 shares of Common
Stock that it will, subject to the satisfaction of the conditions set forth
therein, have the right to acquire from the Company pursuant to the Purchase
Agreement, (ii) 312,500 shares of Common Stock that it will, subject to the
satisfaction of the conditions set forth therein, have the right to acquire from
the Company pursuant to the Supplementary Purchase Agreement and (iii) 2,974,392
shares that, subject to the satisfaction of the conditions set forth therein, it
will have the right to acquire upon exercise of the Options to purchase
Preferred Shares pursuant to the Option Agreement and conversion of such
Preferred Shares into shares of Common Stock pursuant to the Conversion
Agreement. Upon consummation of the transactions contemplated by the Purchase
Agreement, the Supplementary Purchase Agreement, the Option Agreement and the
Conversion Agreement, SOFTBANK Technology will have sole voting power and sole
dispositive power with respect to 8,286,892 shares. In addition, pursuant to the
Stockholders' Agreement and the proxies delivered thereunder as described in
Item 4, SOFTBANK Technology may be deemed to beneficially own 4,979,611 shares
of Common Stock inasmuch as the holders thereof have granted a representative of
SOFTBANK Technology an irrevocable proxy to vote such shares as described in
Item 4. Similar proxy rights with respect to such 4,979,611 shares of Common
Stock have been granted to SOFTBANK Holdings. Accordingly, SOFTBANK Technology
may be deemed to have shared voting power with respect to such 4,979,611 shares
of Common Stock. As a result of the foregoing, SOFTBANK Technology may be deemed
to be the beneficial owner of an aggregate of 13,266,503 shares of Common Stock,
comprising 66.1% of the Common Stock (based on the number of shares of Common
Stock outstanding as of April 30, 1998, as disclosed by the Company in its Proxy
Statement, dated June 4, 1998 (the "Proxy Statement"), and calculated as
provided by Rule 13d-3 under the Securities Exchange Act of 1934, as amended
(the "Exchange Act")).
STV.
As a general partner of SOFTBANK Technology, STV may be deemed to be
the beneficial owner of 13,266,503 shares of Common Stock, comprising 66.1% of
the Common Stock (based on the number of shares of Common Stock outstanding as
of April 30, 1998, as disclosed by the Company in the Proxy Statement, and
calculated as provided by Rule 13d-3 under the Exchange Act). Upon consummation
of the transactions contemplated by the Purchase Agreement, the Supplementary
Purchase Agreement, the Option Agreement and the Conversion Agreement, STV will
have the sole voting power and sole dispositive power with respect to 8,286,892
shares of Common Stock. In addition, STV may be deemed to have shared voting
power with respect to 4,979,611 shares of Common Stock.
SOFTBANK Holdings.
As the sole equityholder of STV, SOFTBANK Holdings may be deemed to be
the beneficial owner of 13,266,503 shares of Common Stock and to have sole
voting power and sole dispositive power (subject to consummation of the
transactions
<PAGE>
CUSIP NO. 337486 10 4 PAGE 8 OF 10 PAGES
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contemplated by the Purchase Agreement, the Supplementary Purchase Agreement,
the Option Agreement and the Conversion Agreement) with respect to 8,286,892
shares of Common Stock and shared voting power with respect to 4,979,611 shares
of Common Stock. In addition, SOFTBANK Holdings may be deemed to be the
beneficial owner of (i) 5,000,000 shares of Common Stock that it will, subject
to the satisfaction of the conditions set forth therein, have the right to
purchase from the Company pursuant to the Purchase Agreement, (ii) 312,500
shares of Common Stock that it will, subject to the satisfaction of conditions
set forth therein, have the right to acquire from the Company pursuant to the
Supplementary Purchase Agreement and (iii) 2,983,488 shares of Common Stock that
it will have the right to acquire upon exercise of the Options to purchase
Preferred Shares pursuant to the Option Agreement and conversion of such
Preferred Shares into Common Stock pursuant to the Conversion Agreement, (iv)
1,200,000 shares of Common Stock that it has the right to acquire pursuant to
the Promissory Note and Stock Purchase Agreement and (v) approximately 2,543,333
shares of Common Stock that it will have the right to acquire through purchase
of the Promissory Notes and conversion of such Promissory Notes into Common
Stock pursuant to the Conversion Agreement. As a result of the foregoing,
SOFTBANK Holdings may be deemed to be the beneficial owner of an aggregate of
25,305,824 shares of Common Stock, comprising 81.9% of the Common Stock (based
on the number of shares of Common Stock outstanding as of April 30, 1998, as
disclosed by the Company in the Proxy Statement, and calculated as provided by
Rule 13d-3 under the Exchange Act), and may be deemed to have sole voting power
and sole dispositive power (assuming consummation of the transactions described
in this Statement) with respect to 20,326,213 shares of Common Stock and to have
shared voting power with respect to 4,979,611 shares of Common Stock.
SOFTBANK; Son.
As the parent of SOFTBANK Holdings and the direct and indirect owner of
an approximate 50% interest of SOFTBANK, respectively, SOFTBANK and Son may each
be deemed to be the beneficial owner of an aggregate of 25,305,824 shares of
Common Stock, comprising 81.9% of the Common Stock (based on the number of
shares of Common Stock outstanding as of April 30,1998, as disclosed by the
Company in the Proxy Statement, and calculated as provided by Rule 13d-3 under
the Exchange Act) and may be deemed to have sole voting power and sole
dispositive power (assuming consummation of the transactions described in this
Statement) with respect to 20,326,213 shares of Common Stock and to have shared
voting power with respect to 4,979,611 shares of Common Stock.
(C). None of the Reporting Persons, nor, to the best knowledge of the
Reporting Persons, any of the persons listed on Schedule 1, 2 or 3 hereto, has
effected any transactions in the securities of the Company during the past 60
days other than those transactions described above.
(D) AND (E). Not applicable.
Pursuant to the Conversion Agreement, the actual number of shares of
Common Stock that may be issued upon conversion of the Promissory Notes will be
equal to (i) the principal amount thereof ($1,200,000) and accrued interest
thereon to the date of conversion divided by (ii) $0.60. The calculations set
forth in this Item 5 are based on the accrued interest on the Promissory Notes
as of April 15, 1998, as estimated by the Company, of approximately $326,000.
Interest accrues on the Promissory Notes at the rate of 8.0% per annum.
Accordingly, although the number of shares of Common Stock to be issued upon
conversion of the Promissory Notes is not currently determinable, the number of
such shares will increase by approximately 438 shares for each day following
April 15, 1998 until the date such conversion is effected.
None of the Reporting Persons has the right to vote or dispose of any
of the shares that it may acquire pursuant to the Purchase Agreement, the
Supplementary Purchase Agreement, the Option Agreement, the Promissory Note and
Stock Purchase Agreement and the Conversion Agreement unless and until the
transactions contemplated thereby are consummated. Such transactions are subject
to conditions precedent, including approval by stockholders of the Company
holding a majority of the outstanding shares of Common Stock. There can be no
assurance that such transactions will be consummated.
By virtue of the Voting Agreement described in Item 6, pursuant to
which Mr. Stein, Mrs. Stein, Paymentech and First USA have agreed with SOFTBANK
Holdings and SOFTBANK Technology to vote their shares in furtherance of certain
mutual agreements, SOFTBANK Holdings, SOFTBANK Technology, SOFTBANK, Son and STV
may be deemed to have shared power to vote the Capital Stock over which Mr.
Stein, Mrs. Stein, Paymentech and First USA have or share the power to vote. As
of April 30, 1998, the aggregate number of shares beneficially owned by Mr.
Stein, Mrs. Stein, Paymentech and First USA was 3,321,217, representing 28.2% of
the outstanding Capital Stock of the Company.
<PAGE>
CUSIP NO. 337486 10 4 PAGE 9 OF 10 PAGES
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ITEM 6. CONTRACTS, ARRANGEMENTS, UNDERSTANDINGS OR RELATIONSHIPS WITH RESPECT
TO SECURITIES OF THE ISSUER.
Item 6 is hereby amended and supplemented by the addition of the
following after the third paragraph:
The Company, SOFTBANK Holdings and SOFTBANK Technology entered into a
Supplementary Purchase Agreement, dated as of June 12, 1998 (the "Supplementary
Purchase Agreement"), pursuant to which SOFTBANK Holdings and SOFTBANK
Technology each severally agreed to purchase an additional 312,500 shares of
Common Stock (the "Additional Shares") from the Company for a purchase price of
$1.20 per share. The consummation of the sale of the Additional Shares is
contingent, among other things, on (i) approval by the Company's stockholders of
the issuance of the Additional Shares to be sold and (ii) the prior or
concurrent consummation of the transactions contemplated by the Purchase
Agreement and the Related Transactions (as defined in the Purchase Agreement).
The material terms of the Supplementary Purchase Agreement are otherwise similar
to those of the Purchase Agreement. All references to the Supplementary Purchase
Agreement are qualified in their entirety by the full text of such agreement, a
copy of which is attached as Exhibit J hereto and is incorporated by reference
herein.
ITEM 7. MATERIAL TO BE FILED AS EXHIBITS.
Item 7 is hereby amended and supplemented by the addition of the
following:
Exhibit J Supplementary Purchase Agreement, dated as of June 12, 1998,
by and among the Company, SOFTBANK Holdings and SOFTBANK
Technology.
<PAGE>
CUSIP NO. 337486 10 4 PAGE 10 OF 10 PAGES
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SIGNATURE
After reasonable inquiry and to the best of my knowledge and belief, I
certify that the information set forth in this statement is true, complete and
correct.
June 15, 1998 SOFTBANK HOLDINGS INC.
By: /s/ Ronald D. Fisher
---------------------------------------
Name: Ronald D. Fisher
Title: Vice Chairman
SOFTBANK TECHNOLOGY VENTURES IV L.P.
By: STV IV LLC
Its General Partner
By: /s/ Gary Rieschel
-------------------------------
Name: Gary Rieschel
Title: Executive Managing Director
SOFTBANK CORPORATION
By: /s/ Ronald D. Fisher
---------------------------------------
Name: Ronald D. Fisher
Title: Attorney-in-Fact
MASAYOSHI SON
By: /s/ Ronald D. Fisher
---------------------------------------
Name: Ronald D. Fisher
Title: Attorney-in-Fact
STV IV LLC
By: /s/ Gary Rieschel
---------------------------------------
Name: Gary Rieschel
Title: Executive Managing Director
EXHIBIT J
SUPPLEMENTARY PURCHASE AGREEMENT
This SUPPLEMENTARY PURCHASE AGREEMENT, dated as of June 12, 1998 (the
"Agreement"), is entered into by and among (i) First Virtual Holdings
Incorporated, a Delaware corporation (the "Company"), and (ii) SOFTBANK
Technology Ventures IV L.P., a Delaware limited partnership and SOFTBANK
Holdings Inc., a Delaware corporation (each a "Purchaser" and, collectively, the
"Purchasers").
WHEREAS, on April 30, 1998, the Company entered into a Purchase
Agreement with certain of the Purchasers providing for a sale (the "Offering")
of shares of its Common Stock to such Purchasers (the "Original Agreement").
WHEREAS, the Company and the Purchasers desire to increase the number
of shares of Common Stock to be issued and sold by the Company in the Offering
by an additional 625,000 shares (the "Shares").
NOW, THEREFORE, the parties hereto agree as follows:
1. Purchase and Sale
(a) Upon the terms and subject to the conditions of this Agreement,
each Purchaser, severally and not jointly, will purchase, and the Company will
issue and sell to each Purchaser, the number of Shares set forth opposite such
Purchaser's name on Exhibit A hereto against payment to the Company of the
purchase price of $1.20 per Share. The consummation of such purchase and sale
(the "Closing") shall occur at the offices of Sullivan & Cromwell, 444 South
Flower Street, Los Angeles, CA 90071 at 9:00 A.M. on the first business day
following the satisfaction or waiver of the conditions set forth in Sections 5
and 6 hereof, or at such other time and date as the Purchasers and the Company
mutually agree (the "Closing Date").
(b) At the Closing, the Company shall deliver to each Purchaser a stock
certificate representing the number of Shares to be purchased by such Purchaser
as set forth on Exhibit A against payment to the Company by wire transfer of the
purchase price therefor in immediately available funds.
2. Representations and Warranties of the Company
The representations and warranties of the Company contained in Sections
2(a), (c), (e), (f), (g), (h), (j) and (l) of the Purchase Agreement dated April
30, 1998 between the Company and the Purchasers (the "Original Agreement") are
incorporated herein by reference. In addition, the Company represents and
warrants to the Purchasers as follows:
<PAGE>
(a) Execution, Delivery and Performance. The Company has the corporate
power and authority to execute, deliver and perform its obligations under this
Agreement. The Board of Directors of the Company has unanimously approved this
Agreement and the transactions contemplated hereby. This Agreement has been duly
authorized, executed and delivered by the Company, and constitutes a valid and
binding agreement of the Company enforceable against the Company in accordance
with its terms.
(b) Shares. All outstanding shares of the Company's capital stock have
been and, when issued and delivered in accordance with the terms of this
Agreement, the Shares will be, duly and validly authorized and issued and fully
paid and non-assessable.
(c) No Conflict. The execution and delivery of this Agreement and the
performance of the Company's obligations hereunder will not (a) violate or be in
conflict with (i) any provision of law, (ii) any order, rule or regulation of
any court or other governmental agency or authority binding on the Company or
(iii) any provision of the Certificate of Incorporation or By-Laws of the
Company, (b) violate, be in conflict with, result in a breach of, or constitute
(with or without notice or lapse of time or both) a default under any material
indenture, agreement, lease or other agreement or instrument to which the
Company is a party or by which it or any of its properties is bound, or (c)
result in the creation or imposition of any lien, charge or encumbrance upon any
of its properties or assets.
(d) Consents, etc. No consent, approval or authorization of or
declaration or filing with any governmental authority or other persons or
entities on the part of the Company is required in connection with the execution
or delivery of this Agreement or the consummation of the transactions
contemplated hereby other than the approval by the holders of a majority of the
Company's outstanding shares of Common Stock of the issuance and sale of the
Shares contemplated by Section 4(a) hereof, except as otherwise contemplated by
this agreement.
(e) Finders. There is no investment banker, broker, finder, consultant
or similar intermediary that has been retained by, or is authorized to act on
behalf of the Company who is entitled to any fee or commission upon consummation
of the transactions contemplated by this Agreement.
-2-
<PAGE>
3. Representations and Warranties of the Purchasers
Each Purchaser, severally but not jointly, represents and warrants to
the Company as follows:
(a) Investment Representations.
(i) Such Purchaser is acquiring the Shares and will acquire any
Underlying Shares for its own account for investment and not with a view to
distribution.
(ii) Such Purchaser is an "accredited investor" as defined in Rule
501(a) under the Securities Act of 1933 (the "Securities Act").
(iii) Such Purchaser has such knowledge, sophistication and experience
in business and financial matters so as to be capable of evaluating the merits
and risks of the prospective investment in the Shares, and has so evaluated the
merits and risks of such investment.
(iv) Such Purchaser is able to bear the economic risk of an investment
in the Shares and, at the present time, is able to afford a complete loss of
such investment.
(v) Such Purchaser understands and acknowledges that (i) the Shares are
being offered and sold to it without registration under the Securities Act by
reason of reliance upon certain exemptions therefrom and (ii) the availability
of such exemptions, depends in part on, the foregoing representations set forth
in this Section 3(a).
(b) Execution, Delivery and Performance. Such Purchaser has the
corporate or partnership, if applicable, power and authority to execute, deliver
and perform its obligations under this Agreement and to consummate the
transactions contemplated hereby. This Agreement has been duly authorized,
executed and delivered by such Purchaser and constitutes a valid and binding
agreement of such Purchaser enforceable against it in accordance with its terms.
(c) Consents, etc. No consent, approval or authorization of or
declaration or filing with any governmental authority or other persons or
entities on the part of such Purchaser is required in connection with the
execution or delivery of this Agreement or the consummation of the transactions
contemplated hereby.
(d) Finders. There is no investment banker, broker, finder, consultant
or similar intermediary that has been retained by, or is authorized to act on
behalf of, such Purchaser who is entitled to any fee or commission upon
consummation of the transactions contemplated by this Agreement.
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4. Covenants
(a) Meeting of the Company Stockholders. The Company shall take all
customary actions in accordance with applicable law and its Certificate of
Incorporation and By-Laws to seek stockholder approval by the holders of a
majority of the outstanding shares of Common Stock at the annual meeting of
stockholders to be held on or before June 30, 1998 (the "Annual Meeting") of the
issuance and sale of the Shares.
(b) Fulfillment of Conditions. Each of the Company and each Purchaser
shall use reasonable efforts to perform, comply with and fulfill all
obligations, covenants and conditions required by this Agreement to be
performed, complied with or fulfilled on its part prior to or at the Closing
Date.
(c) Further Assurances. The Company shall use its reasonable efforts at
any time and from time to time prior to, at and after the Closing to execute and
deliver to the Purchasers such further documents and instruments and to take all
such further actions as the Purchasers reasonably may request in order to convey
and transfer the Shares to the Purchasers and to consummate the transactions
contemplated by this Agreement.
5. Conditions Precedent to Obligations of the Purchasers
The Purchasers' obligation to consummate the transactions contemplated
by this Agreement is subject to the satisfaction at or prior to the Closing Date
of each of the following conditions:
(a) The Related Transactions (as defined in the Original Agreement) and
the transactions contemplated by the Original Agreement shall be consummated
before or concurrently with the consummation of the transactions contemplated in
this Agreement.
(b) The Company shall have caused to be waived any provisions contained
in any employment or severance agreements with Lee H. Stein which provide for
the payment, accrual or acceleration of any benefit (other than the accelerated
vesting of stock options with respect to no more than 67,708 shares of Common
Stock plus 255,319 unvested options under the Company's Compensation Reduction
Plan (of a total of 351,064 options thereunder)) to such person as a result of
the consummation of the transactions contemplated hereby; provided however that
the Company shall have offered Mr. Stein an agreement for provision of
consulting services following the Closing Date, which agreement shall provide
for monthly consulting fees of no less than $6,500 per month and shall be
terminable on no less than two months notice.
(c) No preliminary or permanent injunction or other binding order,
decree or ruling issued by a court of competent jurisdiction or by a
governmental, regulatory or
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<PAGE>
administrative agency or commission, shall be in effect which shall have the
effect of preventing the consummation of the transactions contemplated by this
Agreement; provided, however, that the parties hereto shall use their best
efforts to seek to obtain the removal of such injunction, order, decree or
ruling.
(d) All representations and warranties of the Company contained in this
Agreement shall be true in all material respects at and as of the Closing Date
as though made at such time (except where such representations and warranties
speak as of an earlier date), and the Company shall have performed and complied
in all material respects with all covenants, obligations and conditions required
by this Agreement to be performed or complied with by it prior to or on the
Closing Date.
(e) Stockholders of the Company holding a majority of the outstanding
shares of Common Stock shall have approved the issuance and sale of the Shares
as provided herein and the Board Composition Requirement shall have been duly
established.
(i) All corporate and other proceedings required to carry out the
transactions contemplated by this Agreement and all instruments and other
documents relating to such transactions shall be reasonably satisfactory in form
and substance to Sullivan & Cromwell, counsel to the Purchasers, and the
Purchasers shall have been furnished with such instruments, documents and
opinions as such counsel shall have reasonably requested.
6. Conditions Precedent to Obligations of the Company
The obligation of the Company to consummate the transactions
contemplated by this Agreement is subject to the satisfaction at or prior to the
Closing Date of each of the following conditions:
(a) No preliminary or permanent injunction or other binding order,
decree or ruling issued by a court of competent jurisdiction or by a
governmental, regulatory or administrative agency or commission, shall be in
effect which shall have the effect of preventing the consummation of the
transactions contemplated by this Agreement; provided, however, that the parties
hereto shall use their best efforts to seek to obtain the removal of such
injunction, order, decree or ruling.
(b) All representations and warranties of the Purchasers contained in
this Agreement shall be true in all material respects at and as of the Closing
Date as though made at such time, and the Purchasers shall have performed and
complied in all material respects with all covenants, obligations and conditions
required by this Agreement to be performed or complied with by them prior to or
on the Closing Date.
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<PAGE>
(c) Stockholders of the Company holding a majority of the outstanding
shares of Common Stock shall have approved the issuance and sale of the Shares
as provided herein.
(d) All corporate and other proceedings required to carry out the
transactions contemplated by this Agreement and all instruments and other
documents relating to such transactions shall be reasonably satisfactory in form
and substance to Wilson Sonsini Goodrich & Rosati, counsel to the Company, and
the Company shall have been furnished with such instruments and documents as
such counsel shall have reasonably requested.
7. Indemnification
Each of the Company and each Purchaser (severally but not jointly)(an
"Indemnifying Party") covenants and agrees to indemnify and hold the other (the
"Indemnified Party") harmless from and against, and to reimburse each
Indemnified Party for, any claim for any losses, damages, liabilities or
expenses, including reasonable counsel fees (collectively "Damages") incurred by
such Indemnified Party by reason of or arising from (i) any misrepresentation or
breach of any representation or warranty of such Indemnifying Party contained in
this Agreement or in any instrument delivered hereunder or (ii) any failure by
such Indemnifying Party to perform any obligation or covenant required to be
performed by it under any provision of this Agreement.
The indemnification obligation hereunder shall not apply to any claim
until the aggregate of all such claims against an Indemnifying Party under this
Agreement and under Section 7 of the Original Agreement reaches $200,000, in
which event such Indemnifying Party's indemnity obligation shall apply to the
total amount. The aggregate liability of the Company, on the one hand, and the
aggregate liability of the Purchasers, on the other hand, for indemnity
hereunder and under Section 7 of the Original Agreement shall not exceed
$10,750,000.
8. Termination
(a) This Agreement may be terminated and the transactions contemplated
hereby may be abandoned at any time prior to the Closing, by mutual consent of
the Purchasers and the Company.
(b) This Agreement may be terminated and the transactions contemplated
hereby may be abandoned by action of the Purchasers, acting jointly, or the
Company if (i) the transactions contemplated hereby shall not have been
consummated by July 15, 1998, or (ii) the approval of the Company's stockholders
of the issuance and sale of the Shares shall not have been obtained at the
Company's 1998 Annual Meeting of Stockholders or a special meeting duly convened
therefor or at any adjournment thereof
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<PAGE>
or (iii) a United States federal or state court of competent jurisdiction or
United States federal or state governmental, regulatory or administrative agency
or commission shall have issued an order, decree or ruling or taken any other
action permanently restraining, enjoining or otherwise prohibiting the
transactions contemplated by this Agreement and such order, decree, ruling or
other action shall have become final and non-appealable; provided, that the
party seeking to terminate this Agreement pursuant to the foregoing clause (iii)
shall have used all reasonable efforts to remove such injunction, order or
decree; and provided, in the case of a termination pursuant to clause (i) above,
that the terminating party shall not have breached in any material respect its
obligations under this Agreement in any manner that shall have substantially
contributed to the failure to consummate the transactions contemplated hereby by
July 15, 1998.
(c) This Agreement shall terminate upon termination of the Original
Agreement.
(e) In the event of termination of this Agreement and the abandonment
of the transactions contemplated hereby pursuant to this Section 8, all
obligations of the parties hereto shall terminate.
9. Miscellaneous
(b) Survival. All representations, warranties, covenants and agreements
made herein shall survive for two years after the Closing Date and shall
continue in full force and effect after delivery of and payment for the Shares.
No claim on account of any breach of any representation, warranty, covenant or
agreement made herein, or for indemnification in respect thereof, may be
asserted unless written notice of such breach has been given to the party
against whom such claim is asserted prior to such second anniversary.
(c) Modification and Waiver. No amendment or modification of the terms
or provisions of this Agreement shall be binding unless the same shall be in
writing and duly executed by the parties hereto. No waiver of any of the
provisions of this Agreement shall be deemed to or shall constitute a waiver of
any other provisions hereof. No delay on the part of any party in exercising any
right, power or privilege hereunder shall operate as a waiver thereof.
(d) Entire Agreement. This Agreement sets forth the entire
understanding of the parties with respect to the subject matter hereof. Any
previous agreement or understandings between the parties regarding the subject
matter hereof are merged into and superseded by this Agreement.
(e) Severability. In case any provision in this Agreement (including
the Exhibits and Schedules hereto) shall be invalid, illegal or unenforceable,
the validity,
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<PAGE>
legality and enforceability of the remaining provisions shall not in any way be
affected or impaired thereby.
(f) Notices. All notices, consents or other communications shall be in
writing, and shall be deemed to have been duly given and delivered when
delivered by hand, or when mailed by registered or certified mail, return
receipt requested, postage prepaid, or when received via telecopy, telex or
other electronic transmission, in all cases addressed to the party for whom
intended at its address set forth below:
If to the Purchasers:
At the address set forth on Exhibit A hereto.
with a copy to:
Sullivan & Cromwell
125 Broad Street
New York, New York 10004
Telephone : (212) 558-3504
Telecopier: (212) 558-3588
Attention : Stephen A. Grant, Esq.
If to the Company:
First Virtual Holdings Incorporated
11975 El Camino Real
Suite 300
San Diego, California 92130
Telephone : (619) 793-2700
Telecopier: (619) 793-2950
Attention : Keith S. Kendrick
President
with a copy to:
Wilson Sonsini Goodrich & Rosati
650 Page Mill Road
Palo Alto, California 94304
Telephone : (650) 493-9300
Telecopier: (650) 493-6811
Attention : Jeffrey D. Saper, Esq.
John T. Sheridan, Esq.
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<PAGE>
or such other address as a party shall have designated by notice in writing to
the other party given in the manner provided by this Section.
(g) No Implied Rights. Nothing herein express or implied, is intended
to or shall be construed to confer upon or give to any person, firm, corporation
or legal entity, other than the parties hereto and their affiliates, any
interest, rights, remedies or other benefits with respect to or in connection
with any agreement or provision contained herein or contemplated hereby.
(h) Governing Law. This Agreement shall be governed by and construed in
accordance with the laws of the State of California.
(i) Counterparts. This Agreement may be executed in one or more
counterparts, each of which shall be deemed to be an original, but all of which
shall constitute one and the same instrument.
(j) Assignment by Purchasers. Each of the Purchasers may assign its
right to purchase up to 50% of the Shares to be purchased pursuant to this
Agreement to one or more third parties, provided that such third parties are
reasonably acceptable to the Company, and provided further that such third
parties shall have executed and delivered to the Company a statement
acknowledging assumption of the Purchaser's obligations with respect to such
shares under this Agreement and containing representations and warranties
substantially similar to those set forth in Section 3 hereof.
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<PAGE>
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
duly executed as of the date first above written.
FIRST VIRTUAL HOLDINGS
INCORPORATED
By: /s/ Keith S. Kendrick
-----------------------------
Name: Keith S. Kendrick
Title: President
SOFTBANK TECHNOLOGY
VENTURES IV L.P.
By: Its General Partner
STV IV LLC
By: /s/ Bradley Feld
------------------------------
Name: Bradley Feld
Title: Managing Director
SOFTBANK HOLDINGS INC.
By: /s/ Ronald D. Fisher
------------------------------
Name: Ronald D. Fisher
Title: Vice Chairman
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<PAGE>
EXHIBIT A
SCHEDULE OF PURCHASERS
NUMBER OF SHARES OF COMMON STOCK
NAME PURCHASED
Softbank Holdings Inc. 312,500
10 Langley Road, Suite 403
Newton Center Massachusetts 02169
Facsimile No.: (617) 928-9301
Attention: Ronald Fisher, Vice Chairman
SOFTBANK TECHNOLOGY VENTURES IV L.P. 312,500
10 LANGLEY ROAD, SUITE 403
NEWTON CENTER MASSACHUSETTS 02169
FACSIMILE NO.: (617) 928-9301
ATTENTION: BRADLEY FELD, MANAGING DIRECTOR
TOTAL 625,000
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