EXHIBIT 99.6
ASSET PURCHASE AGREEMENT
BY AND BETWEEN
GLOBALMEDIA.COM
AND
MAGNITUDE NETWORK, INC.
DATED AS OF
AUGUST 3, 2000
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EXHIBITS
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Exhibit A License Agreement
Exhibit B Assignment and Assumption of Lease
Exhibit C Common Stock Purchase Warrant
Exhibit D Bill of Sale
Exhibit E Assignment and Assumption Agreement
Exhibit F Trademark Assignment Agreement
Exhibit G Domain Name Registrant
Name Change Agreement
Exhibit H Escrow Agreement
Exhibit I Non-Solicitation Agreement
SCHEDULES
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Schedule 1.1(a)(i) Company Intellectual Property
Schedule 1.1(a)(ii) Assigned Contracts
Schedule 1.1(a)(v) Equipment
Schedule 1.9(a) Buyer's Counsel Opinion
Schedule 1.9(b) Company's Counsel Opinion
Schedule 2 Disclosure Schedule
Schedule 9.1 Registration Carveouts
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ASSET PURCHASE AGREEMENT
This Asset Purchase Agreement (this "AGREEMENT") is entered into as of August 3,
2000 by and between GlobalMedia.com, a Nevada corporation ("BUYER"), and
Magnitude Network, Inc., a Delaware corporation ("COMPANY"). Buyer and Company
are referred to collectively herein as the "PARTIES."
Recitals
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The Parties believe it is in their best interests that Buyer purchase
certain of the assets and assume certain of the liabilities of Company and enter
into a licensing agreement with respect to certain of the technology of Company.
The Parties desire to make certain representations and warranties in
connection therewith.
NOW, THEREFORE, in consideration of the representations, warranties,
covenants and agreements contained in this Agreement and other good and valuable
consideration, the receipt of which is hereby acknowledged, the Parties agree as
follows:
1. Sale of Assets and Liabilities
1.1 Purchase and Sale of Assets.
(a) Upon and subject to the terms and conditions of this Agreement, at the
Closing (as defined in Section 1.7), Buyer shall purchase from Company, and
Company shall sell, transfer, convey, assign and deliver to Buyer, all of its
right, title and interest, to the extent assignable, in and to the following
assets used by the Online Media and Streaming Solutions business (the
"BUSINESS") of Company (collectively, the "ACQUIRED ASSETS"), free and clear of
all liens, charges and encumbrances:
(i) all computer software programs, in source and object code format
developed and/or used by Company in connection with the Business (the
"SOFTWARE"), all end user, developer and system documentation, manuals,
flow charts, program listings, compilers, libraries, developer tools,
programmers' notes, error logs, diagnostic reports, benchmark results and
similar materials describing or relating to the development, operation,
maintenance and support of the Software (collectively, the
"DOCUMENTATION"), all registered and unregistered trademarks, service
marks, trade names and design marks used by the Company in association with
the Business (the "TRADEMARKS"), all third-party Internet domain names
which are registered in the name of Company and/or which are registered by
other persons for the benefit of Company (the "DOMAIN NAMES"), all Internet
web sites developed, maintained and/or used by Company in connection with
the Business, including the rights of the Company in the literary,
artistic, musical and dramatic works used in the development of such web
sites and/or accessible to viewers of such web sites, all databases of
information compiled from the operation of such web sites and all Software
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used to develop, operate, support, maintain and modify such web sites (the
"WEB SITES"), all inventions, methods and processes, whether patentable or
not, and all discoveries, ideas, concepts, know-how, trade secrets and
other confidential information of Company in connection with the Software,
the Web Sites and the Business ("KNOW-HOW") and all other intangible
intellectual property assets of Company used in connection with the
Business not otherwise specified above (the "OTHER INTANGIBLE ASSETS"). A
list of all Software, Trademarks, Domain Names and Web Sites is set forth
on SCHEDULE 1.1(a)(i) (collectively the Software, Documentation,
Trademarks, Domain Names, Web Sites, Know-how and Other Intangible Assets
are herein referred to as "COMPANY INTELLECTUAL PROPERTY");
(ii) all world-wide patent, copyright, trademark, trade secret, mask
work and other industrial and intellectual property rights, whether arising
under statute or common-law and including all applications for registration
and registrations of such rights in connection with the Company
Intellectual Property (the "INTELLECTUAL PROPERTY RIGHTS");
(iii)all rights of Company, to the extent assignable, under the
contracts, agreements or instruments listed on SCHEDULE 1.1(a)(iii)
attached hereto (collectively, the "ASSIGNED CONTRACTS");
(iv) all permits, licences, orders, ratings and approvals of all
federal, state or local governmental or regulatory authorities that are
held by the Company and relate to the Business, to the extent the same are
transferable; and
(v) equipment set forth on SCHEDULE 1.1 (a)(v) attached hereto (the
"EQUIPMENT").
(b) The Acquired Assets shall not include any assets not specifically
set forth in Section 1.1 (the "EXCLUDED ASSETS").
1.2 Assumption of Liabilities.
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(a) From and after the Closing, Buyer shall assume and become
responsible for all obligations and commitments of Company under the
Assigned Contracts (collectively, the "Assumed Liabilities").
(b) Buyer shall not assume or become responsible for, and Company
shall remain liable for, any and all liabilities or obligations of Company
which are not Assumed Liabilities including, without limitation, the
following:
(i) all liabilities of Company relating to indebtedness for
borrowed money;
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(ii) all liabilities of Company for federal, state, local or
foreign taxes, including taxes incurred in respect of or measured by
the income of Company earned on or realized prior to the Closing Date,
including any gain and income from the sale of the Acquired Assets and
other transactions contemplated herein;
(iii) all liabilities for all environmental, ecological, health
or safety claims to the extent arising out of the operation of Company
or Acquired Assets by Company on or before the Closing Date; and
(iv) any liability of Company based on its illegal conduct.
(collectively, the "Retained Liabilities").
1.3 Licensed Intellectual Property.
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Upon and subject to the terms of a License Agreement, the form attached
hereto as Exhibit A (the "License Agreement"), Company shall license certain
intellectual property from Buyer.
1.4 Assignment of Lease. Upon and subject to the terms of a form of an
assignment and assumption of lease attached hereto as Exhibit B (the "Assignment
of Lease"), Company shall assign to Buyer a sublease of certain premises in
Chicago, Illinois until December 31, 2000.
1.5 Purchase Price. The purchase price to be paid by Buyer for all of the
Acquired Assets shall consist of the following:
(a) such number of shares (the "Shares") of Buyer's common stock,
$0.01 par value per share ("Buyer Common Stock"), equal to the result
obtained by dividing US$6,000,000 by the average of the last reported sales
price per share of Buyer Common Stock on the Nasdaq National Market over
the five (5) consecutive trading days ending on the trading day that is
four (4) trading days prior to but not including the Closing Date, which is
equal to $2.88 (the "Global Media Average Closing Price"), twenty percent
(20%) of which Shares (the "Escrow Shares") to be deposited in escrow
pursuant to Section 1.10 and shall be held and disposed of in accordance
with the terms of the Escrow Agreement in the form of Exhibit H; and (b) a
common stock purchase warrant (the "Warrant") for the purchase of 2,000,000
shares (the "Warrant Shares") of Buyer Common Stock, exercisable at a price
per share equal to the result obtained by multiplying the Global Media
Average Closing Price by 125%, which amount is equal to $3.60, all as more
fully set forth in the form of Warrant attached hereto as Exhibit C.
1.6 Cash Payment by Company. Company shall deliver to Buyer US$238,715
in cash or by check or by wire transfer of immediately available funds to
an account designated by Buyer (the "Company Payment").
1.7 Intentionally Omitted.
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1.8 The Closing. The closing of the transactions contemplated by this
Agreement (the "Closing") shall take place at the offices of Hale and Dorr
LLP in Boston, Massachusetts, commencing at 6:00 p.m., local time on August
3, 2000 (the "Closing Date"). At the Closing:
(a) Bill of Sale. Company shall execute and deliver to Buyer a
Bill of Sale in the form attached hereto as Exhibit D;
(b) Assignment and Assumption. Company and Buyer shall execute
and deliver to Company an Assignment and Assumption Agreement in the
form attached hereto as Exhibit E;
(c) Third-Party Consents. Company shall deliver to Buyer copies
of all consents, approvals, waivers, notices, permits or other
authorizations obtained in connection with the purchase and sale of
the Acquired Assets;
(d) Purchase Price. Buyer shall deliver to Company certificates
for the Shares issued in Company's name and the executed Warrant;
(e) Company Payment. Company shall deliver to Buyer the Company
Payment;
(f) Company's Authorizing Resolutions and Closing Certificates.
Company shall deliver to Buyer certified copies of the resolutions of
its directors and stockholders approving this Agreement and
authorizing the transactions contemplated herein and such other
closing certificates as are customary in a transaction of the nature
contemplated hereby;
(g) Buyer's Authorizing Resolutions and Closing Certificates.
Buyer shall deliver to Company a certified copy of the resolutions of
its directors authorizing the transactions contemplated herein and
such other closing certificates as are customary in a transaction of
the nature contemplated hereby;
(h) License Agreement. Buyer and Company shall enter into a
License Agreement for the license of certain intellectual property
from Buyer, substantially in the form attached hereto as Exhibit A;
(i) Assignment of Lease. Buyer and Company shall enter into an
Assignment of Lease, substantially in the form attached hereto as
Exhibit B;
(j) Trademark Assignment Agreement. Buyer and Company shall enter
into a Trademark Assignment Agreement to effect the assignment of the
trade name and trademarks listed in Schedule 1.1(a)(i), substantially
in the form attached hereto as Exhibit F;
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(k) Domain Name Registrant Name Change Agreements. Buyer and
Company shall enter into Domain Name Registrant Name Change Agreements
to effect the transfer of the domain names listed in Schedule
1.1(a)(i), substantially in the form attached hereto as Exhibit G. In
the event such agreement is not entered into on the Closing Date,
Buyer and Company covenant and agree that they shall enter into such
agreement as soon as practicable following the Closing Date. Buyer
shall pay all fees and expenses payable in connection with the
transfer of such domain names;
(l) Other Assignments of Intellectual Property. Company shall
execute and deliver to Buyer such other agreements, documents and
instruments necessary to transfer all Company Intellectual Property to
Buyer;
(m) Escrow Agreement. Buyer and Company shall enter into an
Escrow Agreement substantially in the form attached hereto as Exhibit
H, setting forth the terms and conditions of an escrow with State
Street Bank and Trust Company as the escrow agent (the "Escrow
Agent");
(n) Non-Solicitation Agreement. Buyer and iCast Corporation shall
enter into a Non-Solicitation Agreement substantially in the form
attached hereto as Exhibit I; and
(o) Transfer of Assets. Company shall, at such place as the
Parties agree upon, deliver to Buyer tangible Acquired Assets
(including, without limitation, source code, programmers' notes, test
scripts and all other documentation and information necessary and
useful in understanding and using the Acquired Assets).
1.9 Legal Opinions. Company shall have received an opinion from
counsel to Buyer, addressed to Company, dated the Closing Date, and
satisfactory in form and substance to Company, to the effect set forth on
Schedule 1.9(a). Buyer shall have received an opinion from counsel to
Company, addressed to Buyer, dated the Closing Date, and satisfactory in
form and substance to Buyer, to the effect set forth on Schedule 1.9(b).
1.10 Escrow. On the Closing Date, Buyer shall deliver to the Escrow
Agent a certificate (issued in the name of the Escrow Agent or its nominee)
representing the Escrow Shares, as described in Section 1.5(a), for the
purpose of securing the indemnification obligations of Company set forth in
this Agreement. The Escrow Shares shall be held by the Escrow Agent under
the Escrow Agreement pursuant to the terms thereof. The Escrow Shares shall
be held as a trust fund and shall not be subject to any lien, attachment,
trustee process or any other judicial process of any creditor of any party,
and shall be held and disbursed solely for the purposes and in accordance
with the terms of the Escrow Agreement.
1.11 Further Assurances. At any time and from time to time after the
Closing, at the request of Buyer and without further consideration, Company
shall promptly execute and deliver such instruments of sale, transfer,
conveyance, assignment and confirmation, and take all such other action as
Buyer may reasonably request, more effectively to transfer, convey and
assign to Buyer, and to confirm Buyer's title to, all of the Acquired
Assets, to put Buyer in actual possession and operating control of the
Acquired Assets, and to carry out the purpose and intent of this Agreement.
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2. Representations and Warranties of Company. Company represents and
warrants to Buyer that the statements contained in this Section 2 are true and
correct except as set forth in the disclosure schedule attached hereto as
Schedule 2 (the "Disclosure Schedule"). The Disclosure Schedule shall be
arranged in paragraphs corresponding to the numbered and lettered paragraphs
contained in this Section 2, and the disclosures in any paragraph of the
Disclosure Schedule shall qualify other paragraphs in this Section 2 to the
extent that such disclosure is applicable to such other paragraphs.
2.1 Organization, Qualification and Corporate Power. Company is a
corporation duly organized, validly existing and in good standing under the
laws of the State of Delaware and has all requisite power and authority to
own and use its properties and to carry on its business as now being
conducted. Company is qualified to transact business as a foreign
corporation and is in good standing under the laws of each jurisdiction in
which the nature of its business or the ownership or leasing of its
properties requires such qualification.
2.2 Authorization of Transaction. Company has all requisite corporate
company power and authority to execute and deliver this Agreement, the Bill
of Sale, the Assignment and Assumption Agreement, the License Agreement,
the Assignment of Lease, the Common Stock Purchase Warrant, the Trademark
Assignment Agreement, the Domain Name Registrant Name Change Agreements,
the Escrow Agreement, the Non-Solicitation Agreement and all other
agreements and instruments entered into in connection with this agreement
(collectively, the "Ancillary Agreements") and to perform its obligations
hereunder and thereunder. The execution and delivery by Company of this
Agreement and the Ancillary Agreements and the consummation by Company of
the transactions contemplated hereby and thereby, have been duly and
validly authorized by all necessary action on the part of the directors and
stockholder of Company. This Agreement and the Ancillary Agreements have
been duly and validly executed and delivered by Company and, assuming this
Agreement and the Ancillary Agreements constitute valid and binding
obligations of Buyer, this Agreement and the Ancillary Agreements
constitute valid and binding obligations of Company, enforceable against
Company in accordance with their respective terms.
2.3 Noncontravention. The execution and delivery by Company of this
Agreement and the Ancillary Agreements and the consummation by Company of
the transactions contemplated hereby and thereby will not, with or without
the giving of notice or the passage of time or both, (a) violate the
provisions of any law, rule or regulation applicable to Company; (b)
violate the provisions of the Certificate of Incorporation and the By-laws
of Company, as amended; (c) violate any judgment, decree, order or award of
any court, governmental body or arbitrator applicable to Company; or (d)
conflict with or result in the breach or termination of any term or
provision of, or constitute a default under, or require any consent under,
or cause any acceleration of rights or obligations under, or cause the
creation of any lien, charge or encumbrance upon Company's assets pursuant
to, any material indenture, mortgage or deed of trust or other agreement or
instrument to which Company is a party or by which Company or any of its
assets is bound.
<PAGE>
2.4 Contracts. Company has previously delivered or made available to
Buyer a true, complete and correct copy of each Assigned Contract. With
respect to each Assigned Contract:
(a) such Assigned Contract is legal, valid, binding, enforceable
and in full force and effect;
(b) subject to obtaining the consents described in Section 2.4(b)
of the Disclosure Schedule (each of which has been obtained), such
Assigned Contract may be assigned to Buyer and will continue to be
legal, valid, binding, enforceable and in full force and effect
immediately following the Closing in accordance with the terms thereof
as in effect prior to the Closing; and
(c) neither Company nor, to the knowledge of Company, any other
party to any of the Assigned Contracts is in material breach of, or
material default under, any such Contract, and no event has occurred
or, to the knowledge of Company, is threatened which, with notice or
lapse of time, would constitute a material breach or material default
or permit termination, modification or acceleration thereunder.
2.5 Litigation. Except as set forth on Section 2.5 of the Disclosure
Schedule, Company: (a) is not a party or subject to any unsatisfied
judgment, order, decree, stipulation or injunction; (b) is not a party or
subject to any material litigation, suit, action, investigation, proceeding
or arbitration; (c) to the knowledge of Company, is not threatened with,
any material litigation, suit, action, investigation, proceeding; or (d)
has not received and is not the subject of any notice of violation, formal
administrative proceeding, investigation, inquiry or information request by
any governmental entity.
2.6 Employees and Consultants. All employees of Company to be
terminated at or prior to the Closing are listed in Section 2.6 of the
Disclosure Schedule, together with their respective job titles and
salaries, including bonuses. Section 2.6 of the Disclosure Schedule sets
forth which of those employees are bound by Company's standard
confidentiality agreement, a copy of which is attached as part of Section
2.6 of the Disclosure Schedule.
2.7 Brokers' Fees. No financial advisor, broker, agent or finder was
utilized by Company in connection with the transactions contemplated by
this Agreement and no fees and expenses are due or owing by Company to any
financial advisor, broker, agent or finder in connection with the
transactions contemplated by this Agreement.
2.8 Intellectual Property.
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(a) Company has good and marketable title to the Company
Intellectual Property that it owns, free and clear of all liens
charges and encumbrances.
(b) Section 2.8(b) of the Disclosure Schedule sets forth a
complete list of all licenses, sublicenses and other agreements
(excluding those relating to shrink wrap or "off-the-shelf" software)
as to which Company is a party and pursuant to which Company or any
other person is authorized to use any Company Intellectual Property or
trade secret of Company, and includes the identity of all parties
thereto, a description of the nature and subject matter thereof, the
applicable royalty or other fees and the term thereof. Each license,
sublicense and other agreement (excluding those relating to shrink
wrap or "off-the-shelf" software) will be transferred or assigned to
the extent transferable or assignable to Buyer effective upon the
Closing. The execution and delivery of this Agreement by Company, and
the consummation of the transactions contemplated hereby, including,
without limitation, the transfer or assignment of the Company
Intellectual Property, will neither cause Company to be in violation
or default under any such license, sublicense or agreement or cause a
termination or modification of such license, sublicense or agreement.
To Company's knowledge, except as set forth in Schedule 1.1(a)(i) or
on Section 2.8(b) of the Disclosure Schedule, Company is the sole and
exclusive owner or licensee of, with all right, title and interest in
and to (free and clear of any liens or encumbrances), or otherwise has
the right to use, the Company Intellectual Property, and has rights
(and is not contractually obligated to pay any compensation to any
third party in respect thereof except for those materials Company has
licensed from a third party ("Third Party Materials"), which Third
Party Materials are expressly referred to in Schedules 1.1(a)(i) or on
Section 2.8(b) of the Disclosure Schedule) to the use thereof or the
material covered thereby in connection with the Business. To Company's
knowledge, the execution and delivery of this Agreement and the
consummation of the transactions contemplated herein shall not permit
any third party with rights in the Third Party Materials to terminate
the ability of Company or Buyer to continue using such Third Party
Materials on the terms previously agreed to by Company and expressly
disclosed to Buyer in writing prior to the date of this Agreement.
(c) With respect to the Company Intellectual Property owned by
Company, no claims with respect to such Company Intellectual Property
are pending or are, to Company's knowledge, threatened by any person,
(i) to the effect that manufacture, sale, licensing or use of any of
the products of Company infringes on any copyright, patent, trademark,
service mark, trade secret or other proprietary right, (ii) against
the use by Company of any trademarks, service marks, trade names,
trade secrets, copyrights, patents, technology, know-how or computer
software programs and applications used in the business as currently
conducted or as proposed to be conducted by Company, or (iii)
challenging the ownership by Company, or the validity or effectiveness
of any of the Company Intellectual Property owned by Company. All
registered trademarks, service marks and copyrights held by Company
are current and subsisting. To Company's knowledge, Company's conduct
of its business has not infringed, and the business as currently
conducted or as proposed to be conducted does not infringe, any
copyright, patent, trademark, service mark, trade secret or other
proprietary right of any third party. To Company's knowledge, there is
no material unauthorized use, infringement or misappropriation of any
of the Company Intellectual Property by any third party, including any
employee or former employee of Company. No Company Intellectual
Property Right owned by Company or product of Company is subject to
any outstanding decree, order, judgment or stipulation restricting in
any manner the licensing thereof by Company. All software owned by
Company that is included in the Company Intellectual Property has been
either created by employees of Company on a work-for-hire basis or by
consultants or contractors who have created such software themselves
and have assigned all rights they may have had in such software to
Company.
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(d) Company has not disclosed the source code for any of the
software owned by Company (the "Software") or other confidential
information constituting, embodied in or pertaining to the Software to
any person or entity, and Company has taken reasonable measure to
prevent disclosure of such source code. The Software is free from
significant defects or programming errors and conform in all material
respect to the written documentation and specifications therefor.
2.9 Taxes. There are no tax liens against the Acquired Assets and to
the knowledge of Company there is no basis for any such lien.
2.10 Equipment. Company owns and possesses and has good marketable
title to the Equipment free and clear of all mortgages, liens, charges,
pledges, security interests, encumbrances or other claims. 2.11 Condition
of Equipment. Except as otherwise disclosed, the Equipment is in good
working order and in a functional state of repair and to the best of the
knowledge of Company, there are no latent defects thereto.
2.12 Conformity with Laws. All material licenses and permits required
for the conduct of the operations of the Business and the uses to which the
Equipment have been put, have been obtained and are in good standing and
such conduct and uses are not in breach of any statute, by-law, regulation,
covenant, restriction, plan or permit, including any regulations relating
the broadcast of radio signals.
2.13 Customer Lists. Customer lists delivered to Buyer hereunder are
complete and accurate lists of all of the customers of the Business as of
the Closing Date. Company has no reason to believe that the benefits of any
relationship with any customers of the Business will not continue after the
Closing Date in substantially the same manner as prior to the date of this
Agreement.
3. Representations and Warranties of Buyer. Buyer represents and warrants
to Company as follows:
3.1 Organization and Corporate Power. Buyer is a corporation duly
organized, validly existing and in good standing under the laws of the
State of Nevada and has all requisite power and authority to own and use
its properties and to carry on its business as now being conducted.
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3.2 Authorization of Transaction. Buyer has all requisite power and
authority to execute and deliver this Agreement and the Ancillary
Agreements and to perform its obligations hereunder and thereunder. The
execution and delivery by Buyer of this Agreement and the Ancillary
Agreements and the consummation by Buyer of the transactions contemplated
hereby and thereby, have been duly and validly authorized by all necessary
corporate action on the part of Buyer. This Agreement and the Ancillary
Agreements have been duly and validly executed and delivered by Buyer and,
assuming this Agreement and the Ancillary Agreements constitute valid and
binding obligations of Company, constitute valid and binding obligations of
Buyer, enforceable against Buyer in accordance with their respective terms.
3.3 Noncontravention. The execution and delivery by Buyer of this
Agreement and the Ancillary Agreements and the consummation by Buyer of the
transactions contemplated hereby and thereby will not, with or without the
giving of notice or the passage of time or both, (a) violate the provisions
of any law, rule or regulation applicable to Buyer; (b) violate the
provisions of the charter or By-laws of Buyer; (c) violate any judgment,
decree, order or award of any court, governmental body or arbitrator
applicable to Buyer; or (d) conflict with or result in the breach or
termination of any term or provision of, or constitute a default under, or
require any consent under, or cause any acceleration of rights or
obligations under, any indenture, mortgage or deed of trust or other
agreement or instrument to which Buyer is a party or by which Buyer or any
of its assets is bound.
3.4 Reports and Financial Statements. Buyer has previously furnished
or made available to Company complete and accurate copies, as amended or
supplemented, of its (a) Annual Report on Form 10-K for the fiscal year
ended December 31, 1999, as filed with the Securities and Exchange
Commission (the "SEC"), and (b) all other reports filed by Buyer under
Section 13 or subsections (a) or (c) of Section 14 of the Securities
Exchange Act of 1934 (the "Exchange Act") with the SEC since June 30, 1999
(such reports are collectively referred to herein as the "Buyer Reports").
Buyer Reports constitute all of the documents required to be filed by Buyer
under Section 13 or subsections (a) or (c) of Section 14 of the Exchange
Act with the SEC from June 30, 1999 through the date of this Agreement.
Buyer Reports complied in all material respects with the requirements of
the Exchange Act and the rules and regulations thereunder when filed. As of
their respective dates, Buyer Reports did not contain any 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, in light of the
circumstances under which they were made, not misleading. The audited
financial statements and unaudited interim financial statements of Buyer
included in Buyer Reports (i) complied as to form in all material respects
with applicable accounting requirements and the published rules and
regulations of the SEC with respect thereto when filed, (ii were prepared
in accordance with GAAP applied on a consistent basis throughout the
periods covered thereby (except as may be indicated therein or in the notes
thereto, and in the case of quarterly financial statements, as permitted by
Form 10-Q under the Exchange Act), (iii) fairly present the consolidated
financial condition, results of operations and cash flows of Buyer as of
the respective dates thereof and for the periods referred to therein, and
(iv) are consistent with the books and records of Buyer.
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3.5 Capitalization. The authorized capital stock of Buyer consists of
200,000,000 shares of Buyer Common Stock (par value $0.001), of which
25,292,105 shares are issued and outstanding and 7,831,725 shares have been
reserved for issuance pursuant to the 1998 through 2000 stock option plans
of Buyer, and 100,000,000 shares of Preferred Stock, $1,000 par value per
share, 9,175 of which shares are issued or outstanding. Warrants to
purchase 1,131,269 shares of Buyer Common Stock are outstanding. All of the
issued and outstanding shares of Buyer Common Stock have been duly
authorized and validly issued and are fully paid and nonassessable. All of
the issued and outstanding shares of capital stock of the Buyer have been
offered, issued and sold by the Buyer in compliance with applicable federal
and state securities laws.
4. Pre-Closing Covenants. Each of the Parties shall use commercially
reasonable efforts to take all actions and to do all things necessary, proper or
advisable to consummate the transactions contemplated by this Agreement.
5. Post-Closing Covenants.
5.1 Employees. Company has or will have terminated the employment of
each of those employees set forth on Schedule 5.1 on or before the Closing
Date, and Buyer shall be permitted to offer employment to any such
employee. Company consents to the hiring of such employees by Buyer and
waives, with respect to the employment by Buyer of such employees, any
claims or rights Company may have against Buyer or any such employee under
any non-competition, confidentiality or employment agreement. Such
employees shall be entitled to participate in the employee benefit plans
and programs of Buyer, to the extent his/her position, salary and other
qualifications makes him/her eligible to participate. Notwithstanding any
offer of employment by Buyer to any such employee, Buyer shall not assume
any liabilities with respect to any employee benefits plans or policies of
Company, including, without limitation, any taxes, sick pay (whether or not
vested), sick and personal leaves, employee policies or employee benefit
claims.
5.2 Proprietary Information. From and after the Closing, Company shall
hold in confidence all knowledge, information and documents of a
confidential nature or not generally known to the public with respect to
Company or its business (including, without limitation, the financial
information, technical information or data relating to Company's products
and services and names of customers of Company) and shall not disclose or
make use of the same (except for accounting and tax purposes) without the
prior written consent of Buyer, except to the extent that such knowledge,
information or documents shall have become public knowledge other than
through a breach of this Agreement by Company.
5.3 Sharing of Data. Company and its accountants and advisors shall
have the right to have reasonable access to such books, records and
accounts, including financial and tax information, and correspondence that
are transferred to Buyer pursuant to the terms of this Agreement for the
limited purposes of concluding its involvement in the business conducted by
Company prior to the Closing Date and for complying with its and their
obligations under applicable securities, tax, environmental, employment or
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other laws and regulations. Buyer shall have the right to have reasonable
access to those books, records and accounts, including financial and tax
information, and correspondence that are retained by Company pursuant to
the terms of this Agreement to the extent that any of the foregoing is
needed by Buyer in order to transfer, convey and assign the Acquired Assets
to Buyer, to confirm Buyer's rights to, title in and ownership of, the
Acquired Assets, to place Buyer in actual possession and operating control
of the Acquired Assets or to comply with Buyer's obligations under
applicable securities, tax, environmental, employment or other laws and
regulations. Each Party shall provide the other Party with such copies of
such documents as the other Party may reasonably request.
In the event that Buyer shall require an audited balance sheet as of
the Closing Date and the related statements of income, stockholders' equity,
retained earnings and changes in the financial condition of Company for the
fiscal year ended July 31, 1999 (the "Audited Financial Statements") for
inclusion in Buyer's financial reporting statements, Company shall provide such
Audited Financial Statements, at Company's expense as soon as is practicable
following written notice thereof from Buyer; provided that such Audited
Financial Statements shall be for a period not to exceed the two years ended
July 31, 2000. In such case, Buyer shall permit the officers, attorneys,
accountants and other representatives of Company, iCast Corporation, a Delaware
corporation ("iCast"), and CMGI, Inc., a Delaware corporation ("CMGI"), (at
reasonable times, on reasonable notice and in a manner so as not to interfere
with the normal business operations of Buyer) (i) to have reasonable access to
the premises, properties, financial and accounting records, contracts, other
records and documents, and personnel, of or pertaining to Buyer for purpose of
providing such Audited Financial Statements, and (ii) to communicate with and
visit Buyer's general counsel, independent auditors, insurance advisors and
members of management.
5.4 Reservation of Buyer Common Stock. Buyer shall reserve and
maintain a sufficient number of shares of Buyer Common Stock for issuance
upon exercise of the Warrant. 5.5 Allocation of Purchase Price. Company and
Buyer shall work in good faith to arrive at a purchase price allocation to
the extent such is necessary.
6. Conditions to Obligations of Buyer. The obligations of Buyer under this
Agreement are subject to the fulfillment, at the Closing Date, of the following
conditions precedent, each of which may be waived in writing in the sole
discretion of Buyer:
6.1 Corporate Proceedings. All corporate and other proceedings
required to be taken on the part of Company to authorize or carry out this
Agreement and to convey, assign, transfer and deliver the Acquired Assets
shall have been taken.
6.2 Stockholder Approval. The stockholders of Company, to the extent
necessary, shall have duly authorized the transactions contemplated by this
Agreement.
<PAGE>
6.3 Governmental Approvals. All governmental agencies, departments,
bureaus, commissions and similar bodies, the consent, authorization or
approval of which is necessary under any applicable law, rule, order or
regulation for the consummation by Company of the transactions contemplated
by this Agreement and the operation of Company's business by Buyer shall
have consented to, authorized, permitted or approved such transactions.
6.4 Consents of Lenders, Lessors and Other Third Parties. Company
shall have provided Buyer with evidence satisfactory to it that Company has
received all requisite consents and approvals of all lenders, lessors and
other third parties whose consent or approval is required in order for
Company to consummate the transactions contemplated by this Agreement,
including, without limitation, all consents required to assign all of the
Assigned Contracts and equipment listed on Schedule 1.1(a)(iii).
6.5 Adverse Proceedings. No action or proceeding by or before any
court or other governmental body shall have been instituted or threatened
by any governmental body or person whatsoever, naming Company, which shall
seek to materially restrain, prohibit or invalidate the transactions
contemplated by this Agreement or which might materially affect the right
of Buyer to own or use the Acquired Assets after the Closing or which may
materially affect the value of the Acquired Assets.
7. Conditions to Obligations of Company. The obligations of Company under
this Agreement are subject to the fulfillment, at the Closing Date, of the
following conditions precedent, each of which may be waived in writing at the
sole discretion of Company:
7.1 Corporate Proceedings. All corporate and other proceedings
required to be taken on the part of Buyer to authorize or carry out this
Agreement shall have been taken.
7.2 Board of Directors and Stockholder Approval. The stockholders and
directors of Buyer, to the extent necessary, shall have duly authorized the
transactions contemplated by this Agreement.
7.3 Governmental Approvals. All governmental agencies, departments,
bureaus, commissions and similar bodies, the consent, authorization or
approval of which is necessary under any applicable law, rule, order or
regulation for the consummation by Buyer of the transactions contemplated
by this Agreement and the operation of Company's business by Buyer shall
have consented to, authorized, permitted or approved such transactions.
7.4 Consents of Lenders, Lessors and Other Third Parties. Buyer shall
have received all requisite consents and approvals of all lenders, lessors
and other third parties whose consent or approval is required in order for
Buyer to consummate the transactions contemplated by this Agreement.
7.5 Adverse Proceedings. No action or proceeding by or before any
court or other governmental body shall have been instituted or threatened
by any governmental body or person whatsoever, naming Buyer, which shall
seek to restrain, prohibit or invalidate the transactions contemplated by
this Agreement or which might materially affect the right of Company to
transfer the Acquired Assets.
<PAGE>
8. Indemnification.
8.1 Indemnification by Company. Company shall indemnify Buyer in
respect of, and hold Buyer harmless against, any and all debts, obligations
and other liabilities, monetary damages, fines, fees, penalties, interest
obligations, deficiencies, losses, costs and expenses (including, without
limitation, amounts paid in settlement, interest, court costs, costs of
investigators, reasonable fees and expenses of attorneys, accountants,
financial advisors and other experts, and other expenses of litigation)
(collectively, "Damages") incurred or suffered by Buyer or any officer,
director or affiliate thereof resulting from, relating to or constituting:
(a) any (i) misrepresentation or breach of warranty of Company
contained in this Agreement or (ii) failure to perform any covenant or
agreement of Company contained in this Agreement;
(b) all liabilities or obligations of Company under the Lease (as
that term is defined in the Assignment of Lease) arising prior to the
Closing Date including, without limitation, all liabilities or
obligations relating to damages caused by or modifications made to the
premises or the building prior to the Closing Date;
(c) any Retained Liabilities; or
(d) all liabilities or obligations of Company to pay severance
benefits to any employee of Company whose employment is terminated (or
treated as terminated) in connection with the consummation of the
transactions contemplated by this Agreement.
8.2 Indemnification by Buyer. Buyer shall indemnify Company in respect
of, and hold Company harmless against, any and all Damages incurred or
suffered by Company resulting from, relating to or constituting:
(a) any misrepresentation, breach of a representation or warranty
or failure to perform any covenant or agreement of Buyer contained in
this Agreement; or
(b) a failure by Buyer to pay or discharge any Assumed
Liabilities.
8.3 Claims for Indemnification. Whenever any claim shall arise for
indemnification hereunder, the party seeking indemnification (the
"Indemnified Party"), shall promptly provide written notification (the
"Claim Notice") to the party from whom indemnification is sought (the
"Indemnifying Party") of (i) a description and the amount or an estimate of
the amount of the Damages incurred or reasonably expected to be incurred by
the indemnified Party (the "Claim Amount") and the liability arising
therefrom, and (ii) a statement that the Indemnified Party is entitled to
indemnification under this Section 8 for such Damages and a reasonable
explanation of the basis therefor. In the event of any such claim for
indemnification hereunder resulting from or in connection with any claim or
legal proceedings by a third-party, the Claim Notice shall be given within
20 business days after receipt by the Indemnified Party of notice of such
suit or proceeding. If the Indemnified Party is seeking to enforce such
claim pursuant to the Escrow Agreement, the Indemnified Party shall deliver
a copy of the Claim Notice to the Escrow Agent as well as to the
Indemnifying Party. The Indemnified Party shall not settle or compromise
any claim by a third party for which it is entitled to indemnification
hereunder without the prior written consent of the Indemnifying Party,
which may be withheld by the Indemnifying Party in its sole discretion,
unless suit shall have been instituted against it and the Indemnifying
Party shall not have taken control of such suit after notification thereof
as provided in Section 8.4 of this Agreement.
<PAGE>
Within 20 days after delivery of a Claim Notice, the Indemnifying
Party shall deliver to the Indemnified Party a written response (the
"Response") in which the Indemnifying Party shall: (i) agree that the
Indemnified Party is entitled to receive all of the Claimed Amount (in
which case the Response shall be accompanied by a payment by the
Indemnifying Party to the Indemnified Party of the Claimed Amount, by check
or by wire transfer, or by tendering Shares or Warrant Shares; provided
that if the Indemnified Party is seeking to enforce such claim pursuant to
the Escrow Agreement, and Company, as the Indemnifying Party, elects in its
sole discretion, not to satisfy such obligation by check or by wire
transfer, or by tendering Shares or Warrant Shares, then with delivery of
the Response, the Indemnifying Party and the Indemnified Party shall
deliver to the Escrow Agent a written notice executed by both parties
instructing the Escrow Agent to distribute to the Buyer such number of
Escrow Shares as have an aggregate Value (as defined in Section 8.5 below)
equal to the Claimed Amount), (ii) agree that the Indemnified Party is
entitled to receive part, but not all, of the Claimed Amount (the "Agreed
Amount") (in which case the Response shall be accompanied by a payment by
the Indemnifying Party to the Indemnified Party of the Agreed Amount, by
check or by wire transfer, or by tendering Shares or Warrant Shares;
provided that if the Indemnified Party is seeking to enforce such claim
pursuant to the Escrow Agreement, and Company, as the Indemnifying Party,
elects in its sole discretion, not to satisfy such obligation by check or
by wire transfer, or by tendering Shares or Warrant Shares, then with the
delivery of the Response the Indemnifying Party and the Indemnified Party
shall deliver to the Escrow Agent a written notice executed by both parties
instructing the Escrow Agent to distribute to the Buyer such number of
Escrow Shares as have an aggregate Value equal to the Agreed Amount) and
the remainder of the Claimed Amount shall be subject to dispute hereunder
or (iii) dispute that the Indemnified Party is entitled to receive any of
the Claimed Amount. If the Indemnifying Party in the Response disputes its
liability for all or part of the Claimed Amount, the Indemnifying Party and
the Indemnified Party shall, during the 20-day period following the
delivery of a Response that reflects a dispute, use good faith efforts to
resolve such dispute. If such dispute is not resolved within such 20-day
period, the Indemnifying Party and the Indemnified Party shall each have
the right to commence litigation for purposes of resolving such dispute.
8.4 Defense by Indemnifying Party. In connection with any claim giving
rise to indemnity hereunder resulting from or arising out of any claim or
legal proceeding by a person who is not a party to this Agreement, the
Indemnifying Party at its sole cost and expense may, upon written notice to
the Indemnified Party, assume control of the defense of such suit or
proceeding with counsel reasonably satisfactory to the Indemnified Party.
The Indemnified Party shall be entitled to participate in (but not control)
the defense of any such action, with its counsel and at its own expense. If
<PAGE>
the Indemnifying Party does not assume the defense of any such claim or
litigation resulting therefrom within 30 days after the date such claim is
made, (a) the Indemnified Party may defend against such claim or
litigation, in such manner as it may deem appropriate, including, but not
limited to, settling such claim or litigation, after giving notice of the
same to the Indemnifying Party, on such terms as the Indemnified Party may
deem appropriate, and (b) the Indemnifying Party shall be entitled to
participate in (but not control) the defense of such action, with its
counsel and at its own expense. If the Indemnifying Party thereafter seeks
to question the manner in which the Indemnified Party defended such third
party claim or the amount or nature of any such settlement, the
Indemnifying Party shall have the burden to prove by a preponderance of the
evidence that the Indemnified Party did not defend or settle such third
party claim in a reasonably prudent manner.
8.5 Survival; Claims for Indemnification Sole and Exclusive Remedy.
All representations and warranties made by the parties herein or in any
instrument or document furnished in connection herewith shall survive the
Closing and any investigation at any time made by or on behalf of the
parties hereto. All such representations and warranties shall expire on the
first anniversary of the Closing Date. All claims and actions for indemnity
pursuant to this Section 8 for breach of any representation or warranty
shall be asserted or maintained in writing by a party hereto on or prior to
the expiration of such one-year period. Notwithstanding anything to the
contrary in this Section 8, Buyer shall not be entitled to receive, and
Company shall not be obligated to pay, the indemnity obligations otherwise
payable by Company to Buyer pursuant to this Section 8 unless and until
such time as the aggregate indemnity obligations exceed $150,000, at which
time Buyer shall be entitled to receive, and Company shall be obligated to
pay, the entire amount of such indemnity obligations, provided that, in no
event shall Buyer be entitled to receive, or shall Company be obligated to
pay in excess of $6,000,000, less the amount of any Company Payment made
pursuant to Section 1 of this Agreement, in the aggregate of indemnity
obligations otherwise payable by Company to Buyer pursuant to this Section
8. In the event Company shall be obligated to pay any indemnity obligations
under this Section 8, Company shall satisfy such obligations by tendering,
in its sole discretion, cash, Shares or Warrant Shares (through delivery of
Warrant Shares previously acquired upon exercise of the Warrant and not
through cancellation of a portion of the Warrant relating to such Warrant
Shares), or any combination thereof. For the purposes of this Section 8,
the "Value" per share of any (i) Shares shall be equal to the Global Media
Average Closing Price on the Date of Closing and (ii)Warrant Shares shall
be equal to the per share exercise price of the Warrant. The remedies of
Buyer under this Section 8 shall be the exclusive remedies of Buyer for any
breach of this Agreement by Company, except that Buyer shall have the right
to seek or obtain injunctive relief for any breach or threatened breach
under this Agreement.
If the legal proceeding or written claim with respect to which a Claim
Notice has been given is definitively withdrawn or resolved in favor of the
Indemnified Party, the Indemnified Party shall promptly so notify the
Indemnifying Party; and if the Indemnified Party has delivered a copy of
the Claim Notice to the Escrow Agent and Escrow Shares have been retained
in escrow after the Termination Date (as defined in the Escrow Agreement)
with respect to such Claim Notice, the Indemnifying Party and the
Indemnified Party shall promptly deliver to the Escrow Agent a written
notice executed by both parties instructing the Escrow Agent to distribute
such retained Escrow Shares to the Company in accordance with the terms of
the Escrow Agreement.
<PAGE>
9. Registration Rights.
9.1 Registration of Shares. Buyer shall use its best efforts to file
with the SEC, within 90 days following the Closing, a registration
statement on Form S-3 (or if Buyer is not eligible to use Form S-3, such
other appropriate Form for which Buyer is eligible to register shares for
resale) covering the resale to the public by Company of the Shares and
Warrant Shares (the "Registration Statement"). Buyer shall use its best
efforts to cause the Registration Statement to be declared effective by the
SEC within 150 days following the Closing; provided that, in the event that
the Registration Statement is not declared effective within such 150 day
period (the "Registration Period"), then Company shall be entitled to
receive such number of shares (the "Liquidity Shares") of Buyer Common
Stock equal to the result obtained by dividing US$120,000 by the average of
the last reported sales price per share of Buyer Common Stock on the Nasdaq
National Market over the five (5) consecutive trading days ending on the
trading day that is the final day of the Registration Period. The Liquidity
Shares shall be deemed "Shares" for purposes of this Agreement and Buyer
shall be obligated to include the Liquidity Shares in the Registration
Statement. Buyer shall cause the Registration Statement to remain effective
until the date two years after the Closing Date or such earlier time as all
of the Shares and Warrant Shares covered by the Registration Statement have
been sold pursuant thereto.
9.2 Rule 144 Requirements. Buyer agrees to:
(a) make and keep current public information about Buyer
available, as those terms are understood and defined in Rule 144;
(b) use its best efforts to file with the SEC in a timely manner
all reports and other documents required of Buyer under the Securities
Act of 1933, as amended (the "Securities Act") and the Exchange Act
(at any time after it has become subject to such reporting
requirements); and
(c) furnish to any holder of Shares and/or Warrant Shares, as the
case may be, upon request (i) a written statement by Buyer as to its
compliance with the reporting requirements of Rule 144 and of the
Securities Act and the Exchange Act (at any time after it has become
subject to such reporting requirements), (ii) a copy of the most
recent annual or quarterly report of Buyer, and (iii) such other
reports and documents of Buyer such holder may reasonably request to
avail itself of any similar rule or regulation of the SEC allowing it
to sell any such securities without registration.
9.3 Registration Procedures.
(a) In connection with the filing by Buyer of the Registration
Statement, Buyer shall furnish to Company a copy of the prospectus,
including a preliminary prospectus, in conformity with the
requirements of the Securities Act.
<PAGE>
(b) Buyer shall use its best efforts to register or qualify the
Shares and Warrant Shares covered by the Registration Statement under
the securities laws of each state of the United States; provided,
however, that Buyer shall not be required in connection with this
paragraph (b) to qualify as a foreign corporation or execute a general
consent to service of process in any jurisdiction.
(c) If Buyer has delivered preliminary or final prospectuses to
Company and after having done so the prospectus is amended or
supplemented to comply with the requirements of the Securities Act,
Buyer shall promptly notify Company and, if requested by Buyer,
Company shall immediately cease making offers or sales of shares under
the Registration Statement and return all prospectuses to Buyer. Buyer
shall promptly provide Company with revised or supplemented
prospectuses and, following receipt of the revised or supplemented
prospectuses, Company shall be free to resume making offers and sales
under the Registration Statement.
(d) Buyer shall pay the expenses incurred by it in complying with
its obligations under this Section 9, including all registration and
filing fees, exchange listing fees, fees and expenses of counsel for
Buyer, and fees and expenses of accountants for Buyer, but excluding
(i) any brokerage fees, selling commissions or underwriting discounts
incurred by Company in connection with sales under the Registration
Statement and (ii) the fees and expenses of any counsel retained by
Company.
9.4 Requirements of Company. Buyer shall not be required to include
any Shares and/or Warrant Shares, as the case may be, in the Registration
Statement unless:
(a) Company furnishes to Buyer in writing such information
regarding such Company and the proposed sale of Shares and Warrant
Shares by Company as Buyer may reasonably request in writing in
connection with the Registration Statement or as shall be required in
connection therewith by the SEC or any state securities law
authorities; and
(b) Company shall have provided to Buyer its written
agreement:
(i) to indemnify Buyer and each of its directors and
officers against, and hold Buyer and each of its directors
and officers harmless from, any losses, claims, damages,
expenses or liabilities (including reasonable attorneys
fees) to which Buyer or such directors and officers may
become subject by reason of any statement or omission in the
Registration Statement made in reliance upon, or in
conformity with, a written statement by Company furnished
pursuant to this Section 9.4; and
(ii) to report to Buyer sales made pursuant to the
Registration Statement.
<PAGE>
9.5 Indemnification. Buyer agrees to indemnify and hold harmless
Company against any losses, claims, damages, expenses or liabilities to
which Company may become subject by reason of any untrue statement of a
material fact contained in the Registration Statement or any omission to
state therein a fact required to be stated therein or necessary to make the
statements therein not misleading, except insofar as such losses, claims,
damages, expenses or liabilities arise out of or are based upon information
furnished in writing to Buyer by or on behalf of Company for use in the
Registration Statement. Buyer shall have the right to assume the defense
and settlement of any claim or suit for which Buyer may be responsible for
indemnification under this Section 9.5.
9.6 "Stand-Off" Agreement. Company, if requested by Buyer and the
managing underwriter of an underwritten public offering by Buyer of Buyer
Common Stock, shall not sell or otherwise transfer or dispose of any Shares
(not including the Warrant Shares) held by Company for a period of 90 days
following the effective date of a registration statement filed by Buyer
with the SEC for a public offering and sale of securities of Buyer (other
than a registration statement on Form S-8 or Form S-4, or their successors,
or any other form for a similar limited purpose, or any registration
statement covering only securities proposed to be issued in exchange for
securities or assets of another corporation); provided, that all
stockholders of Buyer then holding at least 5% of the outstanding Buyer
Common Stock (on an as-converted basis) and all officers and directors of
Buyer enter into similar agreements; and, provided further, that the
foregoing restrictions shall not apply to transfers to iCast, CMGI and any
of their affiliates, provided, that each such transferee agrees in a
written instrument delivered to Buyer to be bound by the provisions of this
Section 9.6.
9.7 Lock-up Agreement. Company shall not sell the Shares during the
period beginning from the Closing Date and continuing for one year.
Notwithstanding the foregoing restriction on transfer, such restrictions
(i) shall not apply to the Warrant Shares, (ii) shall lapse with respect to
12.5% of such Shares on the Closing Date and with respect to and additional
18.75%, 31.25% and 37.5% of such Shares, respectively, six, nine and twelve
months from the Closing Date, and (iii) shall not apply to transfers to of
the Shares, provided, that any such transferee agrees in a written
instrument delivered to Buyer to be bound by the provisions of this Section
9.7 and qualifies as an "accredited investor" pursuant to Regulation D of
the Securities Act.
9.8 Assignment of Rights. Company may assign any of its rights under
this Section 9 in connection with any transfer of the Shares or the Warrant
Shares, provided, that each such transferee agrees in a written instrument
delivered to Buyer to be bound by the provisions of this Section 9.
10. Termination.
10.1 Termination by Agreement of the Parties. This Agreement may be
terminated by the mutual written agreement of the Parties hereto. In the
event of such termination by agreement, Buyer shall have no further
obligation or liability to Company under this Agreement, and Company shall
have no further obligation or liability to Buyer under this Agreement.
<PAGE>
10.2 Termination Due to Lack of Consent. Company or Buyer may
terminate this Agreement if the requisite vote of the stockholders or
directors of such party, where necessary, to authorize this Agreement shall
not have been obtained; provided, that the right to terminate this
Agreement pursuant to this Section 10.2 shall not be available to any party
where the failure to obtain such stockholder or director approval shall
have been caused by the action or failure to act of such party in breach of
this Agreement.
11. Miscellaneous.
11.1 Press Releases and Announcements. No Party shall issue any press
release or announcement relating to the subject matter of this Agreement
without the prior written approval of the other Party; provided, however,
that any Party may make any public disclosure it believes in good faith,
upon advice by counsel, is required by law, regulation or stock market
rules after notice to the other party.
11.2 No Third Party Beneficiaries. This Agreement shall not confer any
rights or remedies upon any person other than the Parties and their
respective successors and permitted assigns.
11.3 Entire Agreement. This Agreement (including the documents
referred to herein) constitutes the entire agreement between the Parties
and supersedes any prior understandings, agreements, or representations
between the Parties, written or oral, that may have related in any way to
the subject matter hereof, including, without limitation, the letter
agreement dated April 26, 2000 between Buyer and Company which shall be
considered terminated.
11.4 Succession and Assignment. This Agreement shall be binding upon
and inure to the benefit of the Parties named herein and their respective
successors and permitted assigns. 11.5 Counterparts. This Agreement may be
executed in two or more counterparts, each of which shall be deemed an
original but all of which together shall constitute one and the same
instrument.
11.6 Headings. The section headings contained in this Agreement are
inserted for convenience only and shall not affect in any way the meaning
or interpretation of this Agreement.
11.7 Notices. All notices, requests, demands, claims, and other
communications hereunder shall be in writing. Any notice, request, demand,
claim, or other communication hereunder shall be deemed duly delivered five
business days after it is sent by registered or certified mail, return
receipt requested, postage prepaid, or one business day after it is sent
for next business day delivery via a reputable nationwide overnight courier
service, in each case to the intended recipient as stt forth below:
<PAGE>
If to Company: with a copy to:
Magnitude Network, Inc. Hale and Dorr LLP
c/o CMGI, Inc. 60 State Street
100 Brickstone Sq. Boston, MA 02109
Andover, MA 01810 Tel: (617) 526-6000
Attention: General Counsel Fax: (617) 526-5000
and Chief Financial Officer Attn: Mark G. Borden, Esq.
Tel: (978) 684-3600
Fax: (978) 684-3601
and to: with a copy to:
iCast Corporation Clark, Wilson, Barristers & Solicitors
78 Dragon Court 800-885 West Georgia Street
Woburn, MA 01801 Vancouver, B.C., Canada
Attention: Chief Financial Officer V6C 3H1
Tel: (781) 994-4100 Tel: (604) 687-5700
Fax: (781) 994-0700 Fax: (604) 687-6314
If to Buyer: Attn: David Cowan, Esq.
GlobalMedia.com
400 Robinson Street
Vancouver, B.C. V6B 2B4
Tel: (604) 688-9994
Fax: (604) 688-9996
Attn: Chief Financial Officer
Any Party may give any notice, request, demand, claim, or other
communication hereunder using any other means (including personal delivery,
expedited courier, messenger service, telecopy, telex, ordinary mail, or
electronic mail), but no such notice, request, demand, claim, or other
communication shall be deemed to have been duly given unless and until it
actually is received by the party for whom it is intended. Any Party may change
the address to which notices, requests, demands, claims, and other
communications hereunder are to be delivered by giving the other Parties notice
in the manner herein set forth.
11.8 Governing Law. This Agreement shall be governed by and construed
in accordance with the internal laws of the State of Delaware without
giving effect to any choice or conflict of law provision or rule.
<PAGE>
11.9 Amendments and Waivers. The Parties may mutually amend or waive
any provision of this Agreement at any time. No amendment or waiver of any
provision of this Agreement shall be valid unless the same shall be in
writing and signed by each of Buyer and Company. No waiver by any Party of
any default, misrepresentation, or breach of warranty, covenant or
agreement hereunder, whether intentional or not, shall be deemed to extend
to any prior or subsequent default, misrepresentation, or breach of
warranty, covenant or agreement hereunder or affect in any way any rights
arising by virtue of any prior or subsequent such occurrence.
11.10 Severability. Any term or provision of this Agreement that is
invalid or unenforceable in any situation in any jurisdiction shall not
affect the validity or enforceability of the remaining terms and provisions
hereof or the validity or enforceability of the offending term or provision
in any other situation or in any other jurisdiction. If the final judgment
of a court of competent jurisdiction declares that any term or provision
hereof is invalid or unenforceable, the Parties agree that the body making
the determination of invalidity or unenforceability shall have the power to
reduce the scope, duration, or area of the term or provision, to delete
specific words or phrases, or to replace any invalid or unenforceable term
or provision with a term or provision that is valid and enforceable and
that comes closest to expressing the intention of the invalid or
unenforceable term or provision, and this Agreement shall be enforceable as
so modified after the expiration of the time within which the judgment may
be appealed.
11.11 Expenses. Each Party shall bear its own costs and expenses
(including legal and other professional fees and expenses) incurred in
connection with this Agreement and the transactions contemplated hereby.
11.12 Construction. The language used in this Agreement shall be
deemed to be the language chosen by the Parties hereto to express their
mutual intent, and no rule of strict construction shall be applied against
either Party. Any reference to any federal, state, local, or foreign
statute or law shall be deemed also to refer to all rules and regulations
promulgated thereunder, unless the context requires otherwise.
11.13 Incorporation of Exhibits and Schedules. The Exhibits and
Schedules identified in this Agreement are incorporated herein by reference
and made a part hereof.
11.14 Facsimile Signature. This Agreement may be executed by facsimile
signature.
[REMAINDER OF PAGE INTENTIONALLY LEFT BLANK]
<PAGE>
IN WITNESS WHEREOF, the Parties hereto have executed this Agreement as of
the date first above written.
MAGNITUDE NETWORK, INC.
/s/ Todd I. Schmidt
------------------------------
Name: Todd I. Schmidt
Title: President
GLOBALMEDIA.COM
/S/ Winston Barta
------------------------------
Name: Winston Barta
Title: Executive V.P.
<PAGE>
