<PAGE> 1
AS FILED WITH THE SECURITIES AND EXCHANGE COMMISSION ON JANUARY 18, 2000
REGISTRATION NO. 333-91839
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
------------------------
AMENDMENT NO. 2 TO FORM S-1
REGISTRATION STATEMENT
UNDER THE SECURITIES ACT OF 1933
------------------------
LENDINGTREE, INC.
(EXACT NAME OF REGISTRANT AS SPECIFIED IN ITS CHARTER)
<TABLE>
<S> <C> <C>
DELAWARE 7370 25-1795344
(State or Other Jurisdiction of (Primary Standard Industrial (I.R.S. Employer
Incorporation or Organization) Classification Code Number) Identification Number)
</TABLE>
------------------------
6701 CARMEL ROAD, SUITE 205
CHARLOTTE, NORTH CAROLINA 28226
(704) 541-5351
(Address, Including Zip Code, and Telephone Number,
Including Area Code, of Registrant's Principal Executive Offices)
------------------------
MR. DOUGLAS R. LEBDA
CHIEF EXECUTIVE OFFICER
LENDINGTREE, INC.
6701 CARMEL ROAD, SUITE 205
CHARLOTTE, NORTH CAROLINA 28226
(704) 541-5351
(Name, Address, Including Zip Code, and Telephone Number,
Including Area Code, of Agent for Service)
------------------------
Copies to:
<TABLE>
<S> <C>
DAVID J. GOLDSCHMIDT, ESQ. MICHAEL J. SCHIAVONE, ESQ.
SKADDEN, ARPS, SLATE, MEAGHER & FLOM LLP ALAN L. JAKIMO, ESQ.
FOUR TIMES SQUARE BROWN & WOOD LLP
NEW YORK, NEW YORK 10036 ONE WORLD TRADE CENTER
(212) 735-3000 NEW YORK, NY 10048
(212) 839-5300
</TABLE>
------------------------
APPROXIMATE DATE OF COMMENCEMENT OF PROPOSED SALE TO THE PUBLIC: As soon as
practicable after the effective date of this Registration Statement.
If any of the securities being registered on this form are to be offered on
a delayed or continuous basis pursuant to Rule 415 under the Securities Act of
1933, check the following box. []
If this form is filed to register additional securities for an offering
pursuant to Rule 462(b) under the Securities Act, check the following box and
list the Securities Act registration statement number of the earlier effective
registration statement for the same offering. []
- ---------------
If this form is a post-effective amendment filed pursuant to Rule 462(c)
under the Securities Act, check the following box and list the Securities Act
registration statement number of the earlier effective registration statement
for the same offering. []
- ---------------
If this form is a post-effective amendment filed pursuant to Rule 462(d)
under the Securities Act, check the following box and list the Securities Act
registration statement number of the earlier effective registration statement
for the same offering. []
- ---------------
If delivery of the prospectus is expected to be made pursuant to Rule 434,
check the following box. []
------------------------
CALCULATION OF REGISTRATION FEE
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C>
PROPOSED MAXIMUM PROPOSED MAXIMUM AMOUNT OF
TITLE OF EACH CLASS OF AMOUNT TO BE OFFERING PRICE AGGREGATE REGISTRATION
SECURITIES TO BE REGISTERED REGISTERED PER SHARE OFFERING PRICE(1) FEE(1)(3)
Common Stock, par value $0.01 per share
(including the associated Rights to
purchase Series A Junior Participating
Preferred Stock)(2)..................... 4,197,500 $12 $50,370,000 $13,298
</TABLE>
- --------------------------------------------------------------------------------
(1) Estimated pursuant to Rule 457(o) under the Securities Act of 1933, as
amended, solely for the purpose of computing the amount of the registration
fee.
(2) The Rights to purchase shares of our Series A Junior Participating Preferred
Stock initially are attached to and trade with the shares of our common
stock being registered hereby. Value attributed to such Rights, if any, is
reflected in the market price of our common stock.
(3) $8,340 of the registration fee was paid previously in connection with the
initial filing of the Registration Statement on December 1, 1999 and $4,958
of the registration fee was previously paid in connection with the filing of
Amendment No. 1 on January 11, 2000.
----------------------------
THE REGISTRANT HEREBY AMENDS THIS REGISTRATION STATEMENT ON SUCH DATE OR
DATES AS MAY BE NECESSARY TO DELAY ITS EFFECTIVE DATE UNTIL THE REGISTRANT SHALL
FILE A FURTHER AMENDMENT WHICH SPECIFICALLY STATES THAT THIS REGISTRATION
STATEMENT SHALL THEREAFTER BECOME EFFECTIVE IN ACCORDANCE WITH SECTION 8(a) OF
THE SECURITIES ACT OF 1933 OR UNTIL THE REGISTRATION STATEMENT SHALL BECOME
EFFECTIVE ON SUCH DATE AS THE COMMISSION, ACTING PURSUANT TO SECTION 8(a), MAY
DETERMINE.
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- --------------------------------------------------------------------------------
<PAGE> 2
PART II
INFORMATION NOT REQUIRED IN PROSPECTUS
ITEM 13. OTHER EXPENSES OF ISSUANCE AND DISTRIBUTION
The following table sets forth an estimate of the costs and expenses, other
than the underwriting discounts and commissions, payable by the Registrant in
connection with the sale of the common stock being registered.
<TABLE>
<CAPTION>
AMOUNT
TO BE PAID
----------
<S> <C>
SEC registration fee........................................ $ 13,298
NASD filing fee............................................. 17,500
Nasdaq National Market listing fee.......................... 95,000
Legal fees and expenses..................................... 500,000
Accounting fees and expenses................................ 300,000
Printing and engraving...................................... 500,000
Blue sky fees and expenses (including legal fees)........... 10,000
Transfer agent fees......................................... 20,000
Premiums for director and officer insurance................. 250,000
Miscellaneous............................................... 294,202
----------
Total............................................. $2,000,000
</TABLE>
ITEM 14. INDEMNIFICATION OF DIRECTORS AND OFFICERS
Section 102 of the Delaware General Corporation Law ("DGCL"), as amended,
allows a corporation to eliminate the personal liability of directors of a
corporation to the corporation or its stockholders for monetary damages for a
breach of fiduciary duty as a director, except where the director breached his
duty of loyalty, failed to act in good faith, engaged in intentional misconduct
or knowingly violated a law, authorized the payment of a dividend or approved a
stock repurchase in violation of Delaware corporate law or obtained an improper
personal benefit.
Section 145 of the DGCL provides, among other things, that the Company may
indemnify any person who was or is a party or is threatened to be made a party
to any threatened, pending or completed action, suit or proceeding (other than
an action by or in the right of the Company) by reason of the fact that the
person is or was a director, officer, agent or employee of the Company or is or
was serving at the Company's request as a director, officer, agent, or employee
of another corporation, partnership, joint venture, trust or other enterprise,
against expenses, including attorneys' fees, judgment, fines and amounts paid in
settlement actually and reasonably incurred by the person in connection with
such action, suit or proceeding. The power to indemnify applies (a) if such
person is successful on the merits or otherwise in defense of any action, suit
or proceeding, or (b) if such person acted in good faith and in a manner he
reasonably believed to be in the best interest, or not opposed to the best
interest, of the Company, and with respect to any criminal action or proceeding,
had no reasonable cause to believe his conduct was unlawful. The power to
indemnify applies to actions brought by or in the right of the Company as well,
but only to the extent of defense expenses (including attorneys' fees but
excluding amounts paid in settlement) actually and reasonably incurred and not
to any satisfaction of judgment or settlement of the claim itself, and with the
further limitation that in such actions no indemnification shall be made in the
event of any adjudication of negligence or misconduct in the performance of his
duties to the Company, unless the court believes that in light of all the
circumstances indemnification should apply.
Section 174 of the DGCL provides, among other things, that a director, who
willfully or negligently approves of an unlawful payment of dividends or an
unlawful stock purchase or redemption, may be held liable for such actions. A
director who was either absent when the unlawful actions were approved or
dissented at the time, may avoid liability by causing his or her dissent to such
actions to be entered in the
II-1
<PAGE> 3
books containing the minutes of the meetings of the board of directors at the
time such action occurred or immediately after such absent director receives
notice of the unlawful acts.
Our Amended and Restated Certificate of Incorporation includes a provision
that eliminates the personal liability of its directors for monetary damages for
breach of fiduciary duty as a director, except for liability:
- for any breach of the director's duty of loyalty to LendingTree or its
stockholders;
- for acts or omissions not in good faith or that involve intentional
misconduct or a knowing violation of law;
- under section 174 of the Delaware General Corporation Law regarding
unlawful dividends and stock purchases; or
- for any transaction from which the director derived an improper personal
benefit.
These provisions are permitted under Delaware law.
Our Amended and Restated Bylaws provide that:
- we must indemnify our directors and officers to the fullest extent
permitted by Delaware law;
- we may indemnify our other employees and agents to the same extent that
we indemnified our officers and directors, unless otherwise determined by
our Board of Directors; and
- we must advance expenses, as incurred, to our directors and executive
officers in connection with a legal proceeding to the fullest extent
permitted by Delaware Law.
The indemnification provisions contained in the Company's Amended and
Restated Certificate of Incorporation and Amended and Restated Bylaws are not
exclusive of any other rights to which a person may be entitled by law,
agreement, vote of stockholders or disinterested directors or otherwise. In
addition, the Company maintains insurance on behalf of its directors and
executive officers insuring them against any liability asserted against them in
their capacities as directors or officers or arising out of such status.
ITEM 15. RECENT SALES OF UNREGISTERED SECURITIES
From our inception in June of 1996, until October 1997, we were financed
through contributions from our founders and through issuances of common stock.
In return for their contributions, our founders received certain amounts of our
common stock. The number of shares and prices per share indicated below have
been adjusted to reflect a two for one stock split which occurred in March 1998
and a 1.27-for-1 stock split effected prior to this offering. The sales and
issuances of securities in each of these transactions and those that follow were
exempt from registration under the Securities Act pursuant to Section 4(2)
thereof, on the basis that the transactions did not involve a public offering.
No underwriters were involved in connection with these sales and issuances.
In October 1997, we sold 558,449 shares of our common stock at a price of
approximately $1.43 per share in exchange for an aggregate price of $800,000 to
ten investors, including 209,550 shares to Richard Field and 69,778 shares to W.
James Tozer, Jr., both of whom are currently directors, and 69,781 shares to
Donald Colby, a former director.
In November 1997, we issued 2,540 shares of our common stock at a price of
approximately $3.15 per share to a consultant in exchange for $8,000 of services
rendered.
In March 1998, we sold 564,443 shares of our common stock to Phoenix
Strategic Capital and an additional 282,224 shares of our common stock to
Theodore Kheel, Jeffrey Hughes, John Prince and William Shiebler at a price of
approximately $3.54 per share in exchange for an aggregate price of $3,000,000.
II-2
<PAGE> 4
In March 1998, Phoenix Strategic Capital provided us with a $1.0 million
line of credit. In connection with this transaction Phoenix Strategic Capital
received a warrant to purchase 9,525 shares of our common stock at an exercise
price of approximately $4.72 per share.
In July 1998, we sold 42,332 shares of our common stock at a price of
approximately $4.72 per share to H. Eugene Lockhart, a former director, in
exchange for $200,000.
In August 1998, we issued 2,937 shares of our common stock at a price of
approximately $4.72 per share to two persons in exchange for $13,875 of services
rendered.
In November 1998, we sold 152,400 shares of our common stock at a price of
approximately $4.72 per share to three investors for an aggregate price of
$720,000, including 12,700 shares which were sold to James Carthaus, who is
currently a director. We also issued 12,700 shares to an employee at a price of
approximately $4.72 per share in exchange for $60,000 of services rendered.
In December 1998, we sold 833,334 shares of our Series A convertible
preferred stock at a price of $6.00 per share and a warrant to purchase 260,000
shares of our Series A convertible preferred stock at an exercise price of $6.00
per share to The Union Labor Life Insurance Company in exchange for an aggregate
price of $5,000,000. We granted a warrant to purchase 63,500 shares of our
common stock at an exercise price of approximately $4.72 per share to Seacris
Group, Ltd. in exchange for services rendered in connection with the December
1998 private placement. In March 1999, we sold an additional 500,000 shares of
our Series A convertible preferred stock at a price of $6.00 per share and a
warrant to purchase 40,000 shares of our Series B convertible preferred stock at
an exercise price of $9.00 per share to The Union Labor Life Insurance Company
in exchange for a total price of $3,000,000.
In May 1999, we sold 333,334 shares of our Series A convertible preferred
stock at a price of $6.00 per share and warrants to purchase 33,020 shares of
our common stock at an exercise price of approximately $7.87 per share to W.
James Tozer, Jr. and Richard Field, both of whom are currently directors, in
exchange for an aggregate price of $2,000,000.
In July 1999, we issued 8% convertible promissory notes in an aggregate
principal amount of $1,750,000 and warrants to purchase 53,340 shares of our
common stock to Hovde Financial Institution Partners II, L.P., Hovde Investment
Corp., L.L.C., Norman Garrity, William N. Schiebler, Barbara A. and Peter A.
Georgescu, and John B. Prince in exchange for an aggregate price of $1,750,000
of which Norman Garrity, a family member of Douglas Lebda, provided $500,000 of
the financing and received a warrant to purchase 15,240 shares.
In July 1999, we issued 6,350 shares of our common stock at a price of
approximately $4.72 per share to an employee in exchange for $30,000 for
services rendered.
In September 1999, we sold 6,024,096 shares of our Series D convertible
preferred stock at a price per share of $8.30 for a total price of $50,000,000
to Capital Z, The Goldman Sachs Group, Inc., General Electric, priceline.com
Incorporated and Marsh & McLennan Risk Capital.
In connection with the September 1999 transaction, the warrants to purchase
series A and series B convertible preferred stock held by The Union Labor Life
Insurance Company were exchanged for a warrant to purchase 381,000 shares of our
common stock at an exercise price of approximately $4.72 per share, and the
convertible promissory notes with a face amount of $1,750,000 held by investors
were exchanged for 214,076 shares of Series D convertible preferred stock. We
redeemed 282,222, 127,000 and 539,750 shares of common stock at a price per
share of approximately $6.30, from Phoenix Strategic Capital Corp., Donald Colby
and Robert Wilson, respectively, for a total price of $5,977,776. In addition,
we granted a warrant to purchase 127,000 shares of common stock at an exercise
price of approximately $7.52 per share valued at $450,000 to Prudential
Securities Inc. in exchange for services rendered in connection with the
September 1999 private placement. In January 2000, Prudential agreed to exchange
the warrant for a new warrant to purchase 127,000 shares of common stock at an
exercise price equal to the price paid by public investors in the offering
pursuant to its role as an underwriter.
II-3
<PAGE> 5
In November 1999, we issued 78,633 shares of our Series A convertible
preferred stock to The Union Labor Life Insurance Company and an aggregate of
9,184 shares of our Series A convertible preferred stock to W. James Tozer, Jr.
and Richard Field to satisfy $527,000 of accrued dividends.
From time to time, we have granted stock options to employees. No
underwriters were involved in connection with these sales and issuances. The
sales and issuances of these securities were exempt from registration under the
Securities Act pursuant to Rule 701 promulgated thereunder on the basis that
these options were offered and sold either pursuant to a written compensatory
benefit plan or pursuant to written contracts relating to consideration, as
provided by Rule 701 of the Securities Act. The following table sets forth
information regarding the grants during the past three fiscal years:
<TABLE>
<CAPTION>
NUMBER OF WEIGHTED AVERAGE
SHARES GRANTED EXERCISE PRICE
-------------- ----------------
<S> <C> <C>
January 1, 1997 through December 31, 1997...... 1,417,825 $1.07
January 1, 1998 through December 31, 1998...... 814,067 $4.70
January 1, 1999 through December 31, 1999...... 1,720,701 $5.43
</TABLE>
In March 1999, Mitchell York, our former president, exercised an option to
purchase 25,400 shares of our common stock for approximately $4.72 per share for
an aggregate of $120,000.
In September 1999, Donald Colby exercised an option to purchase 94,899
shares of our common stock for $1.43 per share. We repurchased 57,219 shares of
the common stock for a price of $6.30 share.
ITEM 16. EXHIBITS AND FINANCIAL STATEMENT SCHEDULES
(a) Exhibits.
<TABLE>
<CAPTION>
NUMBER DESCRIPTION
- ------ -----------
<C> <S>
1.1* Form of Purchase Agreement.
3.1** Form of Amended and Restated Certificate of Incorporation to
be in effect upon the closing of this offering.
3.2** Form of Amended and Restated Bylaws to be in effect upon the
closing of this offering.
4.1* Specimen Common Stock certificate.
4.2** Form of LendingTree's Rights Plan
5.1* Opinion of Skadden, Arps, Slate, Meagher & Flom LLP.
10.1** Employment Agreement between LendingTree, Inc. and Douglas
R. Lebda, dated September 2, 1999.
10.2** Employment Agreement between LendingTree, Inc. and Thomas J.
Reddin, dated November 26, 1999.
10.3* 1999 Stock Option Plan of LendingTree, Inc., dated November
20, 1999.
10.4** 1998 Stock Option Plan of LendingTree, Inc., dated February
3, 1998.
10.5** 1997 Stock Option Plan of CreditSource USA, Inc. (formerly
known as Lewisburg Ventures, Inc. and a predecessor to
LendingTree, Inc.), dated January 15, 1997.
10.6** Internet, Marketing and Licensing Agreement between
LendingTree, Inc. and priceline.com Incorporated, dated as
of August 1, 1998 (incorporated herein by reference to
Exhibit 10.13 of Amendment No. 1 to priceline.com's
Registration Statement on Form S-1, File No. 333-69657 filed
February 16, 1999).
10.7** Registration Rights Agreement, dated September 20, 1999.
10.8** Warrant to Purchase 7,500 shares of Common Stock issued to
Phoenix Strategic Capital, dated November 30, 1998.
10.9** Warrant to Purchase 50,000 shares of Common Stock issued to
Seacris Group, Ltd., dated December 9, 1998.
10.10** Form of Warrant to purchase 13,000 shares of Common Stock
issued to Richard D. Field, dated May 25, 1999, as amended
September 20, 1999.
</TABLE>
II-4
<PAGE> 6
<TABLE>
<CAPTION>
NUMBER DESCRIPTION
- ------ -----------
<C> <S>
10.11** Warrant to purchase 13,000 shares of Common Stock issued to
W. James Tozer, Jr., dated May 25, 1999, as amended
September 20, 1999.
10.12** Form of Warrant to grant a right to purchase an aggregate of
42,000 shares of Common Stock issued to five individual
investors, dated July 13, 1999.
10.13** Warrant to Purchase 300,000 shares of Common Stock issued to
The Union Labor Life Insurance Company, dated September 20,
1999.
10.14** Warrant to Purchase 100,000 shares of Common Stock issued to
Prudential, dated September 20, 1999.
10.15** Co-Branded Site Agreement between LendingTree, Inc. and
CNBC.com LLC, dated as of January 14, 2000.
10.16** Warrant to Purchase 150,000 shares of Common Stock issued to
CNBC.com LLC, dated January 14, 2000.
23.1** Consent of PricewaterhouseCoopers LLP
23.2* Consent of Skadden, Arps, Slate, Meagher & Flom LLP
(included in Exhibit 5.1).
24.1** Powers of Attorney.
27.1** Financial Data Schedule.
</TABLE>
- ---------------
* To be supplied by amendment
** Filed by previous amendment
(b) Financial Statement Schedules.
None.
ITEM 17. UNDERTAKINGS
The undersigned Registrant hereby undertakes to provide to the underwriters
at the closing specified in the purchase agreement, certificates in such
denominations and registered in such names as required by the underwriters to
permit prompt delivery to each purchaser.
Insofar as indemnification for liabilities arising under the Securities Act
of 1933 may be permitted to directors, officers and controlling persons of the
Registrant pursuant to the foregoing provisions, or otherwise, the Registrant
has been advised that in the opinion of the Securities and Exchange Commission
such indemnification is against public policy as expressed in the Act, and is,
therefore, unenforceable. In the event that a claim for indemnification against
such liabilities (other than the payment by the Registrant of expenses incurred
or paid by a director, officer or controlling person of the Registrant in the
successful defense of any action, suit or proceeding) is asserted by such
director, officer or controlling person in connection with the securities being
registered, the Registrant will, unless in the opinion of counsel the matter has
been settled by controlling precedent, submit to a court of appropriate
jurisdiction the question whether such indemnification by it is against public
policy as expressed in the Act and will be governed by the final adjudication of
such issue.
The undersigned Registrant hereby undertakes that:
(1) For purposes of determining any liability under the Securities Act of
1933, the information omitted from the form of prospectus filed as part of this
registration statement in reliance upon Rule 430A and contained in a form of
prospectus filed by the registrant pursuant to Rule 424 (b)(1) or (4), or 497(h)
under the Securities Act of 1933, shall be deemed to be part of this
registration statement as of the time it was declared effective.
(2) For the purpose of determining any liability under the Securities Act
of 1933, each post-effective amendment that contains a form of prospectus shall
be deemed to be a new registration statement relating to the securities offered
therein, and this offering of such securities at that time shall be deemed to be
the initial bona fide offering thereof.
II-5
<PAGE> 7
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, as amended, the
Registrant has duly caused this Registration Statement to be signed on its
behalf by the undersigned, thereunto duly authorized in the City of Charlotte,
State of North Carolina, on this 18th day of January, 2000.
LENDINGTREE, INC.
By: /s/ DOUGLAS R. LEBDA
------------------------------------
Name: Douglas R. Lebda
Title: Chief Executive Officer and
Director
Pursuant to the requirements of the Securities Act of 1933, as amended,
this Registration Statement has been signed by the following persons in the
capacities indicated and on the date below:
<TABLE>
<CAPTION>
SIGNATURE TITLE(S) DATE
--------- -------- ----
<C> <S> <C>
/s/ DOUGLAS R. LEBDA Chief Executive Officer January 18, 2000
--------------------------------------------------- and Director (principal
Douglas R. Lebda executive officer)
* Senior Vice President and January 18, 2000
--------------------------------------------------- Chief Financial Officer
Keith B. Hall
* Vice President and January 18, 2000
--------------------------------------------------- Controller
Brian Regan
* Director January 18, 2000
---------------------------------------------------
James A. Carthaus
* Director January 18, 2000
---------------------------------------------------
Richard Field
* Director January 18, 2000
---------------------------------------------------
Robert Kennedy
* Director January 18, 2000
---------------------------------------------------
Daniel Charles Lieber
* Director January 18, 2000
---------------------------------------------------
Adam Mizel
</TABLE>
II-6
<PAGE> 8
<TABLE>
<CAPTION>
SIGNATURE TITLE(S) DATE
--------- -------- ----
<C> <S> <C>
* Director January 18, 2000
---------------------------------------------------
W. James Tozer, Jr.
*By: /s/ DOUGLAS R. LEBDA
---------------------------------------------
Douglas R. Lebda
Attorney-in-Fact
</TABLE>
II-7
<PAGE> 9
INDEX TO EXHIBITS
<TABLE>
<CAPTION>
NUMBER DESCRIPTION
- ------ -----------
<C> <S>
1.1* Form of Purchase Agreement.
3.1** Form of Amended and Restated Certificate of Incorporation to
be in effect upon the closing of this offering.
3.2** Form of Amended and Restated Bylaws to be in effect upon the
closing of this offering.
4.1* Specimen Common Stock certificate.
4.2** Form of LendingTree's Rights Plan.
5.1* Opinion of Skadden, Arps, Slate, Meagher & Flom LLP.
10.1** Employment Agreement between LendingTree, Inc. and Douglas
R. Lebda, dated September 2, 1999.
10.2** Employment Agreement between LendingTree, Inc. and Thomas J.
Reddin, dated November 26, 1999.
10.3* 1999 Stock Option Plan of LendingTree, Inc., dated November
20, 1999.
10.4** 1998 Stock Option Plan of LendingTree, Inc., dated February
3, 1998.
10.5** 1997 Stock Option Plan of CreditSource USA, Inc. (formerly
known as Lewisburg Ventures, Inc. and a predecessor to
LendingTree, Inc.), dated January 15, 1997.
10.6** Internet, Marketing and Licensing Agreement between
LendingTree, Inc. and priceline.com Incorporated, dated as
of August 1, 1998 (incorporated herein by reference to
Exhibit 10.13 of Amendment No. 1 to Priceline.com's
Registration Statement on Form S-1, File No. 333-69657 filed
February 16, 1999).
10.7** Registration Rights Agreement, dated September 20, 1999.
10.8** Warrant to Purchase 7,500 shares of Common Stock issued to
Phoenix Strategic Capital, dated November 30, 1998.
10.9** Warrant to Purchase 50,000 shares of Common Stock issued to
Seacris Group, Ltd., dated December 9, 1998.
10.10** Form of Warrant to purchase 13,000 shares of Common Stock
issued to Richard D. Field, dated May 25, 1999, as amended
September 20, 1999.
10.11** Warrant to purchase 13,000 shares of Common Stock issued to
W. James Tozer, Jr., dated May 25, 1999, as amended
September 20, 1999.
10.12** Form of Warrant to grant a right to purchase an aggregate of
42,000 shares of Common Stock dated July 13, 1999.
10.13** Warrant to Purchase 300,000 shares of Common Stock issued to
The Union Labor Life Insurance Company, dated September 20,
1999.
10.14** Warrant to Purchase 100,000 shares of Common Stock issued to
Prudential, dated September 20, 1999.
10.15 Co-Branded Site Agreement between LendingTree, Inc. and
CNBC.com LLC, dated as of January 14, 2000.
10.16 Warrant to Purchase 150,000 shares of Common Stock issued to
CNBC.com LLC, dated January 14, 2000.
23.1** Consent of PricewaterhouseCoopers LLP
23.2* Consent of Skadden, Arps, Slate, Meagher & Flom LLP
(included in Exhibit 5.1).
24.1** Powers of Attorney.
27.1** Financial Data Schedule.
</TABLE>
- ---------------
* To be supplied by amendment.
** Filed by previous amendment.
<PAGE> 1
EXHIBIT 10.15
CO-BRANDED SITE AGREEMENT
This Co-Branded Site Agreement (this "Agreement") is entered into as of
January 14, 2000 (the "Effective Date") by and between LendingTree, Inc.
("LendingTree"), a Delaware corporation, and CNBC.com LLC ("CNBC.com"), a
Delaware limited liability company.
WHEREAS, LendingTree has developed a multiple lender consumer loan
origination software program and Internet website, currently located at
www.lendingtree.com (the "LendingTree Site"), through which it operates a loan
request filtering service offering consumers the opportunity to obtain
competitive loan offers from participating lenders in connection with various
products, including first mortgage loans, home equity lines of credit, credit
cards, automobile loans and unsecured personal loans;
WHEREAS, CNBC.com is an interactive media company which operates the
CNBC.com website (the "CNBC.com Site"); and
WHEREAS, LendingTree desires to provide certain of its content and
services to CNBC.com for distribution and marketing through the CNBC.com Site,
and CNBC.com desires to conduct such distribution and marketing, subject to the
terms and conditions of this Agreement.
NOW, THEREFORE, in consideration of the above premises and other good
and valuable consideration received and to be received under this Agreement, the
sufficiency of which is acknowledged by the parties, the parties agree to the
following:
1. DEFINITIONS.
(a) "Above the Fold" shall mean situated within the portion of a
page that is designed to be visible to a user when loaded into and displayed by
a web browser running so that the browser occupies the full screen of a standard
SVGA monitor, without requiring the user to scroll horizontally or vertically
through the page.
(b) "Affiliate" shall mean any Person that is directly or
indirectly, through one or more intermediaries, Controlled by the National
Broadcasting Company, Inc ("NBC"). For purposes of this definition, "Controlled"
shall mean possessing, directly or indirectly, the power to direct or cause the
direction of the management, policies and operations of a Person, whether
through ownership of voting securities, by contract or otherwise.
(c) "Affiliate Web Site" shall mean a Web site owned, controlled or
operated by an Affiliate of NBC.
(d) "Attribution Line" shall mean the line on each page of CNBC.com
which includes a link to CNBC.com's copyright notice, as such line may be
modified from time to time.
<PAGE> 2
(e) "Change of Control" shall mean the occurrence of any of the
following events with respect to LendingTree at any time during the Term: (i)
any Person or group (within the meaning of the Securities Exchange Act of 1934,
as amended) shall have become the beneficial owner of securities representing
more than forty percent (40%) of the aggregate voting power of the then
outstanding securities of LendingTree; (ii) any merger, consolidation or other
transaction between LendingTree and a Person immediately following which the
holders of common equity securities of LendingTree immediately prior to such
transaction do not own more than fifty percent (50%) of the common equity
securities of the surviving entity; (iii) a change or series of changes in the
Board of Directors of LendingTree such that a majority of the directors consists
of persons who (a) were not directors of LendingTree at the Effective Date and
(b) were not recommended to become directors by a majority of the then current
directors or by directors so recommended; or (iv) the sale of all or
substantially all of the assets of LendingTree.
(f) "CNBC.com Content" shall mean Content created, licensed or
otherwise obtained by NBC or CNBC.com which is provided by NBC or CNBC.com for
use within the Co-Branded Sites or any Promotional Content.
(g) "CNBC.com Marks" shall mean the trademarks, trade names, service
marks, logos, domain names and other identifiers owned, controlled by or
licensed by NBC or any Affiliate relating to CNBC.com which are specified on
Exhibit A attached hereto.
(h) "Confidential Information" shall mean all information disclosed
in connection with this Agreement which when provided hereunder is designated in
writing or by other reasonable means as confidential, including, without
limitation, all technical data, trade secrets, plans for products or services,
customer data or lists, marketing plans, financial documents or data, processes
and designs.
(i) "Content" shall mean applications, tools, text, audio, video,
photographs, graphics, links, headlines, summaries, features, stories, commodity
information, and other data or information.
(j) "Go Live Date" shall mean the date on which the Co-Branded Sites
are first posted on CNBC.com, for use by the general public, and other than in
beta or preview formats.
(k) "Intellectual Property Right" means any patent, copyright,
trademark, trade secret, trade dress, mask work, moral right, right of
attribution or integrity or other intellectual property or proprietary right
arising under the laws of any jurisdiction (including, without limitation, all
claims and causes of action for infringement, misappropriation or violation
thereof and all rights in any registrations and renewals).
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(l) "LendingTree Competitor" shall mean an entity whose primary
business is the operation of a website offering consumers lending opportunities
in connection with first mortgage loans, home equity lines of credit, and
automobile loans.
(m) "LendingTree Content" shall mean Content created, licensed or
otherwise obtained by LendingTree which is available on the LendingTree Site,
which relates directly or indirectly to mortgage loans, home equity loans, auto
loans and/or lending generally, and which is provided by LendingTree for use
within the Co-Branded Sites and any Promotional Content.
(n) "LendingTree Marks" shall mean the trademarks, trade names,
service marks, logos, domain names and other identifiers owned, controlled by or
licensed by LendingTree which are specified on Exhibit A attached hereto.
(o) "Look and Feel" shall mean the overall appearance and
presentation of CNBC.com, including, without limitation, graphics, artwork,
color schemes, layout, navigation, mouseovers, organization and HTML developed
specifically for CNBC.com.
(p) "Person" shall mean an individual or a corporation, partnership,
limited liability company, joint venture, trust or any other entity or
organization.
(q) "Promotional Content" shall mean any e-mail or other promotional
material used in connection with the Co-Branded Sites which is intended to
promote use of the Co-Branded Sites.
(r) "Term" shall have the meaning specified therefor in Section 24.
(s) "User" shall mean any person that views or receives the
Co-Branded Sites.
(t) "User Data" shall mean all data collected or received by either
party with respect to Users' use of the Co-Branded Sites.
2. CO-BRANDED SITES.
(a) General. LendingTree and CNBC.com shall work together to develop
three (3) co-branded sites consisting of a mortgage site (the "Mortgage
Center"), a home equity site (the "Home Equity Loan Center") and an auto loan
site (the "Auto Loan Center"), each of which shall incorporate the CNBC.com Look
and Feel and navigation and appear to all Users to be a part of the CNBC.com
Site (collectively, the "Co-Branded Sites"). The Co-Branded Sites will each
contain all or a portion of the content available on the LendingTree Site which
relates directly or indirectly to mortgage loans, home equity loans, auto loans
and/or lending generally (the "Available LendingTree Content"). The specific
content to be used on the Co-Branded Sites will be selected by CNBC.com;
provided, that CNBC.com shall consult with LendingTree regarding such selection.
Except as otherwise provided herein, LendingTree reserves the right to carry the
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LendingTree Content on the LendingTree Site, and to make it generally available
to other third parties, at the same time it makes it available to CNBC.com.
LendingTree shall make available to CNBC.com for inclusion within the Co-Branded
Sites all Available LendingTree Content (including calculators, interactive
tools and written content). LendingTree agrees to make available to CNBC.com
users any and all promotions, discounts and special offers generally made
available to the users of other private label or co-branded sites maintained by
LendingTree.
(b) Updates and Upgrades. LendingTree will promptly incorporate into
the Co-Branded Sites all updates, upgrades and revisions for the LendingTree
Content. If LendingTree creates, purchases, licenses or otherwise acquires the
rights to any new Content which it incorporates into the LendingTree Site,
LendingTree will notify CNBC.com of the availability of such new Content and,
upon request from CNBC.com, add such new Content to the Co-Branded Sites as
LendingTree Content on a three-month exclusive basis; provided that (i)
LendingTree reserves the right to carry these new features and tools on the
LendingTree Site at the same time it makes them available to CNBC.com, and (ii)
LendingTree has the necessary right to grant such a license; provided, that
LendingTree shall use commercially reasonable efforts to obtain the foregoing
rights.
(c) Changes to CNBC.com. To the extent CNBC.com implements any
changes to its Look and Feel or navigation, LendingTree shall immediately
implement such changes on the Co-Branded Sites.
(d) Name. The Co-Branded Sites shall be known as the "Mortgage
Center", the "Home Equity Center", and the "Auto Loan Center" respectively, or
by such other names as may be selected by CNBC.com in consultation with
LendingTree.
3. EXCLUSIVITY.
(a) General. During the Term, except as otherwise provided herein,
LendingTree shall be the exclusive and only CNBC.com partner to receive links
from the CNBC.com Site (including the Co-Branded Sites) directly to loan
origination opportunities via the Internet in the residential mortgage loan,
home equity loan and auto loan categories (the "Exclusive Areas"), and CNBC.com
agrees not to build, sponsor, or co-brand, platforms similar to the Co-Branded
Sites with any entities that compete directly with LendingTree in the Exclusive
Areas. Notwithstanding the foregoing, CNBC.com shall retain the right to
develop, create, or engage third parties to create, areas of the CNBC.com Site,
or co-branded sites, devoted to other lending categories such as personal loans
and credit cards; provided, that CNBC.com shall give LendingTree not less than
one (1) week prior notice of CNBC.com's entering into formal negotiations with a
third party in respect thereof and shall negotiate in good faith with
LendingTree before entering into any such third party relationship. The
exclusivities delineated in this Section are intended to cover only links to
loan origination opportunities in the Exclusive Areas, and shall not prevent
CNBC.com from creating, licensing or otherwise providing related content (such
as current rates, commentary, etc.). Notwithstanding the foregoing, LendingTree
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recognizes that CNBC.com retains the right to accept advertising, sponsorships,
and other promotions from LendingTree Competitors on CNBC.com, and that nothing
contained herein shall restrict CNBC.com's ability to provide editorial coverage
of the Exclusive Areas or any LendingTree Competitors; provided, that CNBC.com
shall not implement any sponsorships from LendingTree Competitors on any pages
upon which LendingTree Content appears (other than the home page of the CNBC.com
Site and the front pages of the Personal Finance Center and the Loan Center).
(b) Citibank and GE. At any time during the Term, CNBC.com may
request that LendingTree use its reasonable efforts to facilitate an enhanced
presence for Citibank and/or GE within one or more of the Co-Branded Sites in a
manner that delivers value to CNBC.com's users. Such enhanced presence(s) shall
not require the provision of any additional compensation or consideration to
LendingTree. In no way will either of these relationships eclipse or minimize
LendingTree's prominence on the Co-Branded Sites.
4. SELECTION OF CONTENT.
(a) Selection of Existing Content by CNBC.com. Within a reasonable
period of time after the Effective Date, CNBC.com shall identify for LendingTree
the LendingTree Content that it elects to include as part of the offerings made
available on each of the Co-Branded Sites. With respect to each Co-Branded Site,
CNBC.com may select only the LendingTree Content which relates directly or
indirectly to the subject matter of such Co-Branded Site, or which relates to
lending generally. LendingTree shall promptly include the selected LendingTree
Content within the applicable Co-Branded Sites, provided that such selection
does not, in LendingTree's reasonable and good faith judgment, violate
applicable law or any agreements between LendingTree and any providers or
licensors of such LendingTree Content.
(b) Selection of New Content by CNBC.com. Not less than ten (10)
days prior to the introduction of any new content or feature on the LendingTree
Site, LendingTree shall provide written notice of the availability of such
Content, which notice shall include a description thereof. Within ten (10) days
of receipt of each such notice, CNBC.com shall provide LendingTree with written
notice as to whether it elects to include such Content as part of the offerings
available within the Co-Branded Sites; provided, that if CNBC.com does not
provide such notice within such period, it shall be deemed to have elected to
include such Content within the Co-Branded Sites. If CNBC.com does elect to so
include, or is deemed to have elected to so include such Content, LendingTree
shall promptly include such Content within the Co-Branded Sites as LendingTree
Content.
(c) Removal of Content. Notwithstanding anything to the contrary
contained herein, CNBC.com shall have the right to require the removal by
LendingTree from the Co-Branded Sites of any Content which CNBC.com, in its good
faith discretion, (i) deems unacceptable or inconsistent with the attributes of
quality, trust or integrity associated with CNBC.com or the NBC family of
brands, or (ii) determines conflicts with, interferes with or is detrimental to
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CNBC.com's interests, reputation or business or which might subject CNBC.com or
any of its Affiliates to unfavorable regulatory action or liability for any
reason.
5. SITE DESIGN AND MODIFICATION; EDITORIAL CONTROL. LendingTree will be
responsible for proposing an initial site design for each of the Co-Branded
Sites and specifications therefor and submitting such proposal to CNBC.com
within a reasonable period of time but in no event later than fifteen (15) days
after the Effective Date. CNBC.com shall promptly comment and respond to each
such proposal and LendingTree shall prepare and submit a mockup of the site
design based upon such comments. This process shall be repeated until a final
site design mutually acceptable to the parties is developed. LendingTree shall
be responsible for developing and producing the final site design, and
implementing such final site design no later than sixty (60) days after the
Effective Date; provided, that if LendingTree does not agree with the site
design favored by CNBC.com at the expiration of such sixty (60) day period, then
CNBC.com's version of the site design shall be implemented but CNBC.com shall
work in good faith with LendingTree to accommodate LendingTree's concerns.
Subsequent to the implementation of the final site design, LendingTree shall
make changes as are reasonably requested by CNBC.com, and CNBC.com shall have
full and complete editorial and creative control and approval over the
presentation, look and feel of the Co-Branded Sites; provided, that the
LendingTree branding specified in Section 14 shall not be adversely affected;
and provided, further, that CNBC.com may not alter the calculators or the text
of articles which make up part of the LendingTree Content without LendingTree's
consent, such consent not to be unreasonably withheld.
6. NAVIGATION. CNBC.com will provide prominent navigational links within
the CNBC.com Site to drive traffic to the Co-Branded Sites; provided, that such
navigational links will not include LendingTree branding. Initially, navigation
to a central lending area (the "Loan Center") shall be accomplished via a direct
link from the home page of the CNBC.com Site, but such navigation shall be
transitioned to the Personal Finance Center currently scheduled to be launched
on CNBC.com in 2000. The links appearing on the front page of the Personal
Finance Center shall be Above the Fold at all times. The links to the Co-Branded
Sites from the Loan Center shall have prominence that is no less favorable than
links to other lending content or services appearing within the Loan Center
(other than advertising and editorial content) and will carry branding in
accordance with Section 13(a). Any other links to the Co-Branded Sites shall be
placed at CNBC.com's discretion.
7. MARKETING AND PROMOTION.
(a) General. All marketing and promotional efforts for the
Co-Branded Sites, and all Promotional Content used in connection therewith,
shall be subject to the approval of both parties. If either party wishes to
conduct a marketing or promotional campaign, then such party shall make a
proposal, including the actual Promotional Content to be used, via e-mail or
letter to a list of representatives of the other party (which list may be
modified from time to time upon written notice) for approval/modification. If no
objection or counter-proposal is received within ten (10) business days of
receipt, said proposal will be deemed approved. Campaigns signifi-
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cantly similar in content, timing, and target audience that have been previously
approved by a party will be deemed pre-approved by such party for purposes
hereof. Any objection shall be set forth in writing and shall state the grounds
for the objection. LendingTree acknowledges that the user experience of CNBC.com
is broader than the Co-Branded Sites and that CNBC.com has the right to restrict
or curtail any marketing or promotional campaign to the extent it believes such
campaign may be deemed by Users as too frequent, not of interest, in conflict
with other content available on CNBC.com or the applicable Affiliate Web Site,
or otherwise inappropriate. CNBC.com acknowledges that LendingTree may restrict
or curtail marketing or promotional campaigns it believes are inappropriate or
portray LendingTree or its services in a manner that is competitively
unfavorable.
(b) Sharing of Registration Information. The parties shall use good
faith efforts to cooperate regarding the sharing of the registration data in
order to optimize the marketing of the Co-Branded Sites and enhance the
experience of the Users of the Co-Branded Sites; provided, that any data so
exchanged would be subject to all applicable law, rules and regulations and the
privacy policies of the CNBC.com Site and LendingTree Site.
8. ADVERTISING AND SPONSORSHIPS.
(a) CNBC.com shall have sole and complete control over any and all
advertising and sponsorships that appear within the Co-Branded Sites and shall
be entitled to retain all revenues derived therefrom. CNBC.com and/or its
advertisers shall be responsible for the creation and development of all
advertisements and sponsorships for the Co-Branded Sites. Notwithstanding the
foregoing, LendingTree shall work with CNBC.com and its technology and
infrastructure vendors regarding all technical aspects of implementing all
advertising and sponsorships on the Co-Branded Sites, including without
limitation hosting, serving and tracking such advertising and sponsorships, and
ensuring that all such services are provided uniformly across the Co-Branded
Sites and the rest of the CNBC.com Site using CNBC.com's chosen ad serving
technology. LendingTree will not implement a separate ad servicing technology
within the Co-Branded Sites from that used on the CNBC.com site.
(b) LendingTree shall have sole and complete control over any and
all advertising and sponsorships that appear on the LendingTree Site, including
on pages linked from the Co-Branded Sites (the "Linked Pages"), and shall be
entitled to retain all revenues derived therefrom; provided, that all
advertising and sponsorships appearing on the linked pages shall be in
compliance with CNBC.com's then current standards and practices regarding
inappropriate advertising.
9. FEES.
(a) Click-Through Fees. As compensation for marketing, distribution
and other services and facilities provided by CNBC.com under this Agreement,
LendingTree shall pay to CNBC.com a fee equal to the amount specified on
Schedule 9(a) for each click-through made by
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a Unique Visitor to the Co-Branded Sites (each, a "Click-Through") (all such
fees collectively, the "Click-Through Fee"). The Click-Through Fee shall be
determined solely based on Click-Through rates as measured by CNBC.com. A
"Unique Visitor" shall mean a User who visits the Co-Branded Sites one or more
times during a one calendar week period. CNBC.com agrees to use commercially
reasonable efforts to implement any new methods now or hereafter developed to
track Click-Throughs. The Click-Through Fees shall be due and payable whether or
not the Click-Throughs results in a registration with the LendingTree Site or an
application being made to LendingTree for a loan.
(b) Offset. The Advertising Fee (defined below in subsection (c))
payable in respect of any particular calendar month shall be offset against the
Click-Through Fee payable with respect to that month such that LendingTree shall
only pay the Click-Through Fees for that month that exceed the Advertising Fee
for that month.
(c) Advertising Fee. Commencing with the calendar month in which the
Go Live Date occurs, LendingTree shall pay to CNBC.com a monthly fee of $125,000
(the "Advertising Fee") as compensation for the positioning provided to
LendingTree hereunder and the Marketing Support described in Section 11. By way
of example, if the Click-Through Fee is $150,000, LendingTree shall pay CNBC.com
a total of $150,000 (the $125,000 Advertising Fee and a $25,000 additional
Click-Through Fee); if the Click-Through Fee is $100,000, LendingTree shall only
pay CNBC.com a total of $125,000 (the $125,000 Advertising Fee). In the event
that the aggregate monthly Click-Through Fee exceeds the Advertising Fee,
LendingTree shall pay to CNBC.com the additional Click-Through Fee amount, which
amount shall be calculated as specified in subsection (a) above. The Advertising
Fee shall be due and payable monthly in advance no later than the fifth day of
the applicable month; provided, that with respect to the first month in which
the Advertising Fee is payable, it shall be due and payable five (5) days after
the Go Live Date. For overdue amounts due and payable hereunder, LendingTree
shall pay a late charge at the rate of the lesser of 1.5% per month or the
maximum rate allowed by law.
(d) Legal Compliance. All compensation paid by LendingTree pursuant
to this Agreement will comply and be in accordance with all Real Estate
Settlement Procedures Act ("RESPA") guidelines and all other applicable federal
and state laws, rules and regulations (collectively, "Applicable Law"). In the
event such compensation is determined not to be in compliance with Applicable
Law, then the parties shall negotiate in good faith for a period of sixty (60)
days regarding a new compensation plan that will provide CNBC.com with a level
of compensation that is comparable to that provided herein. In the event the
parties are unable to so agree, then either party may terminate this agreement
upon thirty (30) days prior written notice to the other party.
(e) Payments. CNBC.com shall invoice LendingTree monthly in arrears
for the Click-Through Fee, and LendingTree shall pay to CNBC.com the
Click-Through Fee within thirty (30) days following receipt of invoice.
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(f) Audit and Examination. LendingTree shall have the right, twice
each calendar year, at its expense, to have the records or reports rendered by
CNBC.com during the previous 12 months audited by independent certified public
accountants (an "Audit"), and each party agrees to cooperate with such
accountants in conducting such Audit. All out-of-pocket costs and expenses
incurred by CNBC.com in connection with the Audit shall be reimbursed by
LendingTree. Notwithstanding the foregoing, if as of the result of any Audit, it
is determined that the Click-Through Fee determined by CNBC.com hereunder for
any calendar quarter during the period covered by the Audit exceeds by five
percent (5%) or more the amount of such Click-Through Fee actually payable
according to the terms hereof during such calendar quarter within such period,
then CNBC.com shall reimburse LendingTree for all reasonable out-of-pocket costs
and expenses incurred by it in connection with such Audit. In any event,
CNBC.com shall immediately refund to LendingTree the amount of such overpayment
established by the audit to the extent actually paid by LendingTree, together
with interest calculated at an interest rate per annum equal to the Wall Street
Journal Prime plus two (2%) from the date the deficient amount should have been
paid until the date of payment.
10. WARRANTS. Simultaneously with the execution of this Agreement,
LendingTree and CNBC.com shall execute a Warrant Purchase Agreement and
ancillary agreements as described therein.
11. MARKETING SUPPORT.
(a) General. CNBC.com shall provide marketing, advertising and
promotional support ("Marketing Support") for the Co-Branded Sites through a
variety of media as may be selected by CNBC.com in its good faith discretion but
in consultation with LendingTree. Such Marketing Support (i) shall include
without limitation advertising on CNBC.com, integration into CNBC on-air
television programming (subject in all instances to CNBC's editorial
discretion), targeted e-mail to CNBC.com registered users, and such other
platforms as may become available to CNBC.com, (ii) shall be spread roughly
evenly over the course of the Initial Term, and (iii) except with respect to the
Co-op Support (as defined below), shall not involve any promotion of the
LendingTree brand directly. Such Marketing Support shall include: (x) such
number of banners, buttons and text links as is specified on Schedule 11(a) to
run on CNBC.com, as well as such other CNBC.com properties as may be selected by
CNBC.com and approved by LendingTree, such approval not to be unreasonably
withheld; (y) such number of targeted e-mail banners as is specified on Schedule
11(a); and (z) such amount of advertising inventory as is specified on Schedule
11(a) on the television networks controlled by CNBC.com's Affiliates as may be
selected by CNBC.com, and as approved by LendingTree, such approval not to be
unreasonably withheld ("Advertising Inventory"). In addition, CNBC.com shall
provide an amount of additional marketing support valued as specified on
Schedule 11(a) ("Additional Marketing Support"). Such Additional Marketing
Support shall be allocated among banners, buttons, text links, targeted e-mails
and television advertisement inventory at CNBC.com's discretion valued at then
current market rates. All banners, buttons and targeted e-mail banners shall be
subject to CNBC.com's standard advertiser terms and conditions. All Advertising
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Inventory shall be subject to the applicable television network's standard
advertiser terms and conditions, as the case may be. CNBC.com will also provide
monthly schedules to LendingTree of upcoming co-marketing/promotional campaigns
for the Exclusive Categories.
(b) Co-op Support. LendingTree shall pay an amount of
dollar-for-dollar cooperative television advertising support as specified on
Schedule 11(b) as part of the compensation for the Marketing Support described
in Subsection (a) above (the "Co-op Advertising Support"), with one-half of such
amount payable in the first year of the Initial Term and one-half of such amount
payable in the second year of the Initial Term; provided, that the portion of
the Marketing Support which is equivalent in value to the Co-op Support shall
include promotion of the LendingTree brand via LendingTree logos and
accompanying audio LendingTree mentions. Within [30 ] days of the end of each
month, CNBC.com shall provide LendingTree with a summary of the Marketing
Support provided by CNBC.com during such month along with an invoice for the
Co-op Advertising Support due and payable by LendingTree in respect thereof,
which invoice shall include a calculation showing the determination of the
amount so due and payable. With respect to television advertisement inventory,
CNBC.com shall calculate the Co-op Advertising Support amount using the then
current market rates. Each payment of Co-op Advertising Support shall be due and
payable no later than thirty (30) days from date of invoice. For overdue amounts
due and payable hereunder, LendingTree shall pay a late charge at the rate of
the lesser of 1.5% per month or the maximum rate allowed by law.
(c) Audit. LendingTree shall have the right, twice each calendar
year, at its expense, to have an independent certified public accountant audit
CNBC.com's Marketing Support to confirm that it has met its Co-op Advertising
Support obligations. In the event such audit reveals over-reporting of the
Marketing Support of 10% or more, CNBC.com shall promptly provide LendingTree
with make-goods to satisfy its obligations hereunder and shall refund any costs
LendingTree incurs in respect of the audit.
12. ADVERTISING BUY. During the Term of this Agreement, LendingTree shall
purchase an amount of advertising inventory on the CNBC television network in
accordance with the terms set forth in Exhibit D attached hereto.
13. BRANDING; ATTRIBUTION.
(a) LendingTree will receive attribution in conformance with
attribution standards set forth in Exhibit B attached hereto (the "Attribution
Standards"). LendingTree shall not incorporate any advertising, branding, logos,
links or other promotional material into the Co-Branded Sites or any Promotional
Content without the prior written consent of CNBC.com; provided however, that
CNBC.com shall integrate LendingTree's "powered by" tagline and/or logo (i) on
the Co-Branded Sites (x) directly beneath and adjacent to the "Mortgage Center",
"Auto Center" or "Home Equity Center" title, as the case may be, appearing on
each page of the Co-Branded Sites, and (y) in a point-size or graphic-size no
smaller than one-third (1/3) the point-size or graphic-size in which the
"Mortgage Center", "Auto Center" or "Home Equity Center" title, as
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the case may be, appears on such page; and (ii) on all three (3) links to the
Co-Branded Sites from the Loan Center (e.g. "Auto Loan Center-Powered by
LendingTree"). Any links from the Co-Branded Sites to the LendingTree Site,
including the appearance thereof and text appearing thereon, shall be mutually
agreed between CNBC.com and LendingTree. CNBC.com shall contractually obligate
each of its Affiliates to which it syndicates the Co-Branded Sites to provide
attribution and branding substantially similar to that specified in the
Attribution Standards and in this Section.
(b) Each page of the Loan Center and the Co-Branded Sites which
contains "Powered by Lending Tree" branding shall include a disclaimer in
eight-point font at the bottom of such page which contain the following language
or such other language as may be mutually agreed between the parties: "CNBC.com
shall not be responsible or liable for any products or services obtained by or
through the LendingTree.com website. The materials displayed on this site do not
constitute an offer or promise to make a loan, or an endorsement of
LendingTree.com or the products and services made available on the
LendingTree.com website."
(c) If the CNBC television network ("CNBC-TV") uses any LendingTree
Content or portions thereof on-air on CNBC-TV in a graphic or text format, it
will provide attribution to LendingTree in conformance with CNBC's then
prevailing attribution standards, which standards are subject to change in
CNBC-TV's sole discretion; provided, that CNBC-TV shall not be obligated to so
use such LendingTree Content.
14. TECHNICAL; HOSTING.
(a) General. Subject to Subsection (b) below, LendingTree shall act
as remote host system operator for the Co-Branded Sites using its hosting
facilities located at Digex in Reston, Virginia, and shall make the Co-Branded
Sites available and accessible via the World Wide Web. Such hosting services
shall include providing fully redundant Internet connectivity from LendingTree's
hosting facility to the public Internet. LendingTree's operation of the
Co-Branded Sites, including but not limited to its hosting services and
technical maintenance of the Co-Branded Sites hereunder, shall at all times
comply with generally-accepted industry standards for a high-quality
consumer-oriented content and e-commerce website. In addition, all hosting and
connectivity services provided by LendingTree hereunder shall be governed by the
Service Level Agreement attached hereto as Exhibit C.
(b) Transition to Hosting By CNBC.com. At any time during the Term,
CNBC.com may, upon providing written notice to LendingTree, elect to transfer
hosting and back-end support of the Co-Branded Sites to one or more of its then
current hosting providers. Upon receipt of such notice, LendingTree shall
promptly cooperate with CNBC.com and its hosting provider(s) regarding the
transition from LendingTree hosting systems to those of CNBC.com, and shall take
such further actions as are reasonably necessary in order to effect such
transition. Any hardware and third party software necessary for such transition
shall be purchased by CNBC.com. Upon the transmission of such notice, the
parties shall negotiate within thirty (30)
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days an agreement pursuant to which LendingTree shall (i) provide consulting and
integration services in connection with such migration at time and materials
rates to be negotiated between the parties, which time and materials rates shall
be competitive with those then available from third parties, (ii) license the
LendingTree Content to CNBC.com on a royalty-free basis, it being understood and
agreed that such license shall not include any LendingTree loan qualification
forms or LendingTree's core loan transaction platform, and (iii) transmit the
LendingTree Content to CNBC.com without charge in a timely fashion for
incorporation within the Co-Branded Sites such that the LendingTree Content
appearing on the Co-Branded Sites is always as up-to-date as the corresponding
content appearing on the LendingTree Site. As an interim measure in order to
cover the period between a notification by CNBC.com pursuant to this Section and
such time as the LendingTree Content has been fully migrated to the CNBC.com's
hosting provider(s), CNBC.com may elect to make the Co-Branded Sites available
to its users by framing elements of the LendingTree Site within a frame
embodying the CNBC.com look and feel, which frame is hosted by CNBC.com.
LendingTree agrees to cooperate with CNBC.com regarding the implementation of
such framing in a manner that provides CNBC.com's users with a high quality
experience.
(c) Performance Data. Both parties shall provide the other with
monthly reports detailing the performance of the Co-Branded Sites, including
such metrics as the volume of traffic from links on the CNBC.com Site to the
Co-Branded Sites. These reports shall be in a format, as may be reasonably
requested by the requesting party from time to time.
(d) LendingTree Site Data. LendingTree shall make available to
CNBC.com such aggregated data regarding the activities of Users on the
LendingTree Site as may be reasonably requested by CNBC.com, but in no event
less than the aggregated data provided to LendingTree's other partners, such
data to be broken down by Co-Branded Site as well as comparatively versus other
LendingTree partner sites. In addition, LendingTree shall provide CNBC.com with
the maximum amount of personalized data regarding the activities of Users on the
LendingTree Site as is consistent applicable law, rules and regulations and
LendingTree's privacy policy as in effect from time to time. All such data shall
be made available to CNBC.com in a reasonably convenient manner via a password
protected website, or via such other method as may be mutually agreed between
the parties. To the extent CNBC.com has any difficulties accessing or
interpreting such data, LendingTree shall use commercially reasonable efforts to
work together with CNBC.com to resolve any such difficulties.
15. SYNDICATION OF THE CO-BRANDED SITES. At any time during the Term,
CNBC.com may request that LendingTree Content from the Sites be syndicated to
the Affiliate Web Sites. LendingTree shall be entitled to recoup any actual and
reasonable incremental costs associated with implementing any such content
syndication, but shall not charge any additional fees or costs in connection
therewith. Upon any such request, LendingTree shall promptly provide CNBC.com
with an estimate of the incremental costs associated with such content
syndication, and CNBC.com shall then promptly notify LendingTree as to whether
the relevant Affiliate(s) wish to proceed. If such Affiliate(s) wish to proceed,
LendingTree shall work together with such
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Affiliate(s) to implement such content syndication as promptly as practicable,
and CNBC.com shall cause such Affiliate(s)to reimburse LendingTree for the
agreed upon incremental costs directly. Any syndication shall include all
essential LendingTree Content as set forth in Exhibit E.
16. PROPERTY AND PROPRIETARY RIGHTS.
(a) Ownership of Look and Feel. The look and feel of the Co-Branded
Sites, including, without limitation, HTML, graphics, artwork, and links
provided by or developed specifically for CNBC.com (the "Look and Feel"), and
all Intellectual Property Rights associated therewith shall be owned exclusively
by CNBC.com, and no right, title or interest in or to any of the same is
granted, transferred or assigned to LendingTree by this Agreement.
(b) Ownership of User Data. All User Data shall be owned jointly by
the parties. The parties agree to use such User Data only to the extent
permitted under (i) the privacy policies of the CNBC.com Site and LendingTree
Site, and (ii) any applicable federal and/or state law, rules and regulations.
(c) Ownership of Systems Development. All computer programming code
developed by LendingTree in connection with the implementation of the Co-Branded
Sites, other than the Look and Feel, and all Intellectual Property Rights
associated therewith, shall be owned exclusively by LendingTree.
(d) Ownership of Editorial Content. All rights in and to any and all
LendingTree Content, including any updates and upgrades, furnished by
LendingTree in connection with this Agreement shall remain in LendingTree. All
rights in and to any and all CNBC.com Content furnished by CNBC.com or any of
its Affiliates in connection with this Agreement shall remain in CNBC.com or
such Affiliate, as the case may be.
(e) Trademark License.
(i) Subject to all the terms and conditions of this
Agreement, CNBC.com hereby grants to LendingTree a revocable, nonexclusive,
non-transferable, non-sublicensable license to use the CNBC.com Marks solely
within the Co-Branded Sites and within Promotional Content as provided by
CNBC.com, in its sole discretion, from time to time. CNBC.com may change the
appearance and/or style of the CNBC.com Marks or add or subtract from the list
on Exhibit A, provided that unless required earlier by a court order or to avoid
potential infringement liability, LendingTree shall have five (5) days notice to
implement any such changes. LendingTree hereby acknowledges and agrees that (A)
the CNBC.com Marks are owned solely and exclusively by the National Broadcasting
Company, Inc. ("NBC"), CNBC.com or their Affiliates, (B) except as set forth
herein, LendingTree has no rights, title or interest in or to the CNBC.com
Marks, and (C) all use of the CNBC.com Marks by LendingTree shall inure to the
benefit of NBC, CNBC.com and/or their Affiliates. LendingTree agrees not to
apply for
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registration of the CNBC.com Marks (or any mark confusingly similar thereto)
anywhere in the world. LendingTree agrees that it shall not engage, participate
or otherwise become involved in, or knowingly permit, any activity or course of
action that diminishes and/or tarnishes the image and/or reputation of NBC,
CNBC.com or of any CNBC.com Mark. Upon written notice from CNBC.com that
CNBC.com, in its sole discretion, deems the use of any of the CNBC.com Marks to
be inconsistent with NBC's or CNBC.com's guidelines or standards, LendingTree
will cease such use of the applicable CNBC.com Mark(s) within three (3) days of
LendingTree's receipt of such written notice. CNBC.com shall use commercially
reasonable efforts to provide LendingTree with an alternate version of the use
of the applicable CNBC.com Mark(s) which complies with NBC's and CNBC.com's
guidelines or standards.
(ii) LendingTree acknowledges and agrees that the
presentation and image of CNBC.com Marks should be uniform and consistent with
respect to all services, activities, products, content and portions of the
CNBC.com Site. Accordingly, LendingTree agrees to use the CNBC.com Marks and the
CNBC.com Notice (as defined below) solely in the manner in which CNBC.com shall
specify from time to time in CNBC.com's sole discretion. All usage by
LendingTree of the CNBC.com Marks shall include the trademark symbol and shall
be in the following form: [CNBC.com Mark]?, [CNBC.com Mark](R) and/or [CNBC.com
Mark]SM. All literature and materials printed, distributed or electronically
transmitted by LendingTree and containing the CNBC.com Marks shall include the
following notice (the "CNBC.com Notice"):
[CNBC.com Mark] is a trademark or registered trademark of
[[NBC, Inc.][National Broadcasting Company, Inc. or the applicable
Affiliate] in the United States and/or in other countries.
(iii) Subject to all the terms and conditions of this
Agreement, LendingTree hereby grants to CNBC.com a revocable, nonexclusive,
non-transferable, non-sublicensable license to use the LendingTree Marks solely
within the Co-Branded Sites and within Promotional Content as provided by
LendingTree, in its sole discretion, from time to time. LendingTree may change
the appearance and/or style of the LendingTree Marks or add or subtract from the
list on Exhibit A, provided that unless required earlier by a court order or to
avoid potential infringement liability, CNBC.com shall have five (5) days notice
to implement any such changes. CNBC.com hereby acknowledges and agrees that (A)
the LendingTree Marks are owned solely and exclusively by LendingTree, (B)
except as set forth herein, CNBC.com has no rights, title or interest in or to
the LendingTree Marks, and (C) all use of the LendingTree Marks by CNBC.com
shall inure to the benefit of LendingTree. CNBC.com agrees not to apply for
registration of the LendingTree Marks (or any mark confusingly similar thereto)
anywhere in the world. CNBC.com agrees that it shall not engage, participate or
otherwise become involved in, or knowingly permit, any activity or course of
action that diminishes and/or tarnishes the image and/or reputation of
LendingTree or of any LendingTree Mark. Upon written notice from LendingTree
that LendingTree, in its sole discretion, deems the use of any of the
LendingTree Marks to be inconsistent with LendingTree's guidelines or standards,
CNBC.com will cease such use of the applicable LendingTree Mark(s) within three
(3) days of CNBC.com's receipt of such
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written notice. LendingTree shall use commercially reasonable efforts to provide
CNBC.com with an alternate version of the use of the applicable LendingTree
Mark(s) which complies with LendingTree's guidelines or standards.
(iv) CNBC.com acknowledges and agrees that the presentation
and image of LendingTree Marks should be uniform and consistent, and
accordingly, CNBC.com agrees to use the LendingTree Marks solely in the manner
in which LendingTree shall specify from time to time in LendingTree's sole
discretion; provided, that this Section shall in no event result in any
modification that would increase the size, prominence or related characteristics
of the branding granted to LendingTree hereunder.
17. REPRESENTATIONS, WARRANTIES AND COVENANTS OF LENDINGTREE. LendingTree
hereby represents and warrants to CNBC.com, and covenants and agrees with
CNBC.com that: (a) it has the right, power and authority to enter into this
Agreement and perform its obligations as set forth herein; (b) it is under no
obligation or restriction, nor will it assume any such obligation or
restriction, that does or would interfere or conflict with its obligations under
this Agreement; (c) LendingTree has obtained or is exempt with respect to, or
will use its best efforts to obtain as soon as reasonably practicable, all
necessary permits and licenses in all jurisdictions in which LendingTree
conducts its business; (d) the services provided by LendingTree hereunder will
be rendered in a commercially reasonable manner in accordance with high industry
standards; (e) it is either the owner of all of the LendingTree Content or it
has the right to use, publish and license CNBC.com, its Affiliates and their
respective end users to access, use and publish such LendingTree Content as
permitted herein; (f) the amount of the compensation paid and to be paid to
CNBC.com by LendingTree under this Agreement is reasonably related to the value
of the goods, facilities and services actually provided or to be provided by
CNBC.com, without regard to the value or volume of mortgage loans resulting
therefrom; and (g) the Co-Branded Sites shall not contain or have attached to
them any virus, worm, Trojan horse or similar instrumentality.
18. REPRESENTATIONS, WARRANTIES AND COVENANTS OF CNBC.COM. CNBC.com hereby
represents and warrants to LendingTree, and covenants and agrees with
LendingTree that: (a) it has the right, power and authority to enter into this
Agreement and perform its obligations as set forth herein; (b) it is under no
obligation or restriction, nor will it assume any such obligation or
restriction, that does or would interfere or conflict with its obligations under
this Agreement; and (d) it is the owner of or has obtained the rights to use and
license to LendingTree the CNBC.com Marks, the CNBC.com Content, and the Look
and Feel.
19. INDEMNIFICATION.
(a) Infringement Indemnification. LendingTree shall indemnify,
defend and hold harmless CNBC.com, its Affiliates and their respective
shareholders, members, officers, agents, directors and employees (the "CNBC.com
Parties"), from and against any and all losses, claims, liabilities, damages,
costs and expenses (including, without limitation, reasonable attorneys' fees)
arising out of or incurred by the CNBC.com as a result of any actual or
threatened claim,
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action, investigation, proceeding or suit (each, a "Claim") alleging that the
licensing, use, reproduction, display, publishing, distribution or other
exploitation of the LendingTree Content by any of the CNBC.com Parties in
accordance with the rights granted hereunder constitutes an infringement,
dilution or unauthorized use of any patent, copyright, trademark, trade secret,
proprietary information, right of privacy or any other proprietary right of any
third party. In the event some or all of the LendingTree Content is held by a
court of competent jurisdiction to infringe, an injunction is obtained against
use of any material portion of the LendingTree Content, or CNBC.com believes in
its good faith judgment that the LendingTree Content is infringing, then
LendingTree shall promptly, at its option and expense, either (i) procure for
CNBC.com the right to continue to use the infringing LendingTree Content as set
forth in this Agreement, (ii) replace or modify the infringing LendingTree
Content to make its use non-infringing while being capable of performing
essentially the same functions, or (iii) require CNBC.com to return or remove
the infringing LendingTree Content and cancel all rights thereto; provided that
LendingTree shall use its best efforts to implement (i) or (ii). If LendingTree
determines that it is unable to implement (i) or (ii) and therefore implements
(iii), then CNBC.com may, at its option, terminate this Agreement and/or be
entitled to recover all amounts paid by CNBC.com or any Affiliate in connection
with the infringing LendingTree Content.
(b) Infringement Indemnification. CNBC.com shall indemnify, defend
and hold harmless LendingTree, its Affiliates and their respective shareholders,
members, officers, agents, directors and employees (the "LendingTree Parties"),
from and against any and all losses, claims, liabilities, damages, costs and
expenses (including, without limitation, reasonable attorneys' fees) arising out
of or incurred by the LendingTree as a result of any actual or threatened Claim
alleging that the licensing, use, reproduction, display, publishing,
distribution or other exploitation of the CNBC.com Content by any of the
LendingTree Parties in accordance with the rights granted hereunder constitutes
an infringement, dilution or unauthorized use of any patent, copyright,
trademark, trade secret, proprietary information, right of privacy or any other
proprietary right of any third party. In the event some or all of the CNBC.com
Content is held by a court of competent jurisdiction to infringe, an injunction
is obtained against use of any material portion of the CNBC.com Content, or
LendingTree believes in its good faith judgment that the CNBC.com Content is
infringing, then CNBC.com shall promptly, at its option and expense, either (i)
procure for LendingTree the right to continue to use the infringing CNBC.com
Content as set forth in this Agreement, (ii) replace or modify the infringing
CNBC.com Content to make its use non-infringing while being capable of
performing essentially the same functions, or (iii) require LendingTree to
return or remove the infringing CNBC.com Content and cancel all rights thereto;
provided that CNBC.com shall use its best efforts to implement (i) or (ii). If
CNBC.com determines that it is unable to implement (i) or (ii) and therefore
implements (iii), then LendingTree may, at its option, terminate this Agreement
and/or be entitled to recover all amounts paid by LendingTree or any Affiliate
in connection with the infringing CNBC.com Content.
(c) Cross Indemnity. Each party (the "Indemnifying Party") shall
indemnify and hold harmless the other party, its affiliates, and their
respective officers, directors, members, employ-
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ees and agents (the "Indemnified Party") from and against any and all Claims
instituted by third parties, as well as any and all losses, liabilities,
damages, costs and expenses (including reasonable attorneys fees) arising out of
or accruing from (a) any misrepresentation or breach of the Indemnifying Party's
representations and warranties set forth in this Agreement; and (b) any
non-compliance by the Indemnifying Party with any covenants, agreements or
undertakings of such party contained in or made pursuant to this Agreement.
(d) Permits and Licenses. LendingTree shall indemnify and hold
harmless the CNBC.com Parties from and against any and all Claims instituted by
third parties, as well as any and all losses, liabilities, damages, costs and
expenses (including reasonable attorneys fees) arising out of or accruing from
any failure of LendingTree to obtain all necessary permits and licenses in all
jurisdictions in which LendingTree conducts its business.
20. DISCLAIMER OF WARRANTIES. EXCEPT AS OTHERWISE SPECIFICALLY PROVIDED IN
THIS AGREEMENT, NEITHER PARTY MAKES ANY OTHER WARRANTIES, EITHER EXPRESS,
IMPLIED OR STATUTORY, INCLUDING WITHOUT LIMITATION ANY IMPLIED WARRANTIES OF
TITLE, MERCHANTABILITY OR FITNESS FOR A PARTICULAR PURPOSE.
21. LIMITATION OF LIABILITY. Except with respect to Section 19, each party's
liability for any and all claims arising in connection with this Agreement shall
not exceed the sum total of all payments made by each respective party
hereunder. TO THE MAXIMUM EXTENT PERMITTED BY LAW, NEITHER PARTY, NOR THEIR
RESPECTIVE EMPLOYEES, OFFICERS, DIRECTORS, AFFILIATES, AGENTS OR SUPPLIERS,
SHALL BE LIABLE FOR ANY CONSEQUENTIAL, SPECIAL, INCIDENTAL, OR INDIRECT DAMAGES,
OR LOST OR IMPUTED PROFITS OR ROYALTIES, LOST DATA OR COST OF PROCUREMENT OF
SUBSTITUTE GOODS OR SERVICES, WHETHER FOR BREACH OF WARRANTY OR ANY OBLIGATION
ARISING THEREFROM OR OTHERWISE, HOWEVER CAUSED AND ON ANY THEORY OF LIABILITY
(INCLUDING NEGLIGENCE OR STRICT LIABILITY), AND IRRESPECTIVE OF WHETHER THE
PARTY HAS ADVISED OR BEEN ADVISED OF THE POSSIBILITY OF ANY SUCH LOSS OR DAMAGE.
BOTH PARTIES ACKNOWLEDGE AND AGREE THAT THE AMOUNTS PAYABLE HEREUNDER ARE BASED
IN PART UPON THESE LIMITATIONS, AND FURTHER AGREE THAT THESE LIMITATIONS SHALL
APPLY NOTWITHSTANDING ANY FAILURE OF ESSENTIAL PURPOSE OF ANY LIMITED REMEDY.
22. CONFIDENTIALITY.
(a) General. During the Term and for a period of two (2) years
thereafter, each party shall treat as confidential all Confidential Information
of the other party, shall not use such Confidential Information except as set
forth herein, and shall not disclose such Confidential Information to any third
party. Without limiting the foregoing, each of the parties shall use at least
the same degree of care which it uses to prevent the disclosure of its own
confidential
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information of like importance to prevent the disclosure of Confidential
Information disclosed to it by the other party under this Agreement, but in no
event less than reasonable care. Each party shall promptly notify the other
party of any actual or suspected misuse or unauthorized disclosure of the other
party's Confidential Information. Upon expiration or termination of this
Agreement, each party shall return all Confidential Information received from
the other party. Any breach of the restrictions contained in this Section is a
breach of this Agreement that may cause irreparable harm to the non-breaching
party. Any such breach shall entitle the non-breaching party to injunctive
relief in addition to all legal remedies.
(b) Exclusions. Notwithstanding the above, neither party shall have
liability to the other with regard to any Confidential Information of the other
which (i) was in the public domain at the time it was disclosed or has entered
the public domain through no fault of the receiving party, (ii) was known to the
receiving party, without restriction, at the time of disclosure, (iii) is
disclosed with the prior written approval of the disclosing party, (iv) was
independently developed by the receiving party without any use of the
Confidential Information, as reasonably demonstrated by the receiving party, (v)
becomes known to the receiving party, without restriction, from a source other
than the disclosing party without breach of this Agreement by the receiving
party and otherwise not in violation of the disclosing party's rights, (vi) is
disclosed generally to third parties by the disclosing party without
restrictions similar to those contained in this Agreement, or (vii) is disclosed
pursuant to the order or requirement of a court, administrative agency, or other
governmental body; provided, that the receiving party shall provide prompt
notice thereof to the disclosing party to enable the disclosing party to seek a
protective order or otherwise prevent or restrict such disclosure. Each party
shall be entitled to disclose the existence of this Agreement, but agrees that
the terms and conditions of this Agreement shall be treated as Confidential
Information and shall not be disclosed to any third party; provided, that each
party may disclose the terms and conditions of this Agreement (A) as required by
any court or other governmental body, (B) as otherwise required by law, (C) to
legal counsel of the parties, (D) in confidence, to accountants, banks and
financing sources and their respective advisors, (E) if necessary in connection
with the enforcement of this Agreement or rights under this Agreement, or (F) in
confidence, in connection with an actual or proposed merger, acquisition or
similar transaction.
23. TERM AND TERMINATION.
(a) Term. The term of this Agreement (the "Term") shall commence on
the Effective Date and expire two (2) years from the Go Live Date. This
Agreement may be terminated by either party at the end of its applicable Term by
giving written notice to the other party at least ninety (90) days prior
thereto, but in default of such notice, the Term shall be automatically renewed
under the same terms and conditions for successive periods one (1) year each.
(b) Termination. This Agreement shall be subject to termination
under the following circumstances:
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(i) If either party defaults in the performance of any
material provision of this Agreement, then the non-defaulting party may give
written notice to the defaulting party that if the default is not cured within
thirty (30) days, the Agreement will be terminated. If the non-defaulting party
gives such notice and the default is not cured during such thirty (30) day
period, then this Agreement shall automatically terminate at the end of such
period.
(ii) This Agreement shall terminate, without notice, (i) upon
the institution by or against either party of insolvency, receivership or
bankruptcy proceedings or any other proceedings for the settlement of such
party's debts, (ii) upon either party's making an assignment for the benefit of
creditors, or (iii) upon either party's dissolution or ceasing to do business.
(iii) In the event the average amount of the Click-Through Fee
generated by the Co-Branded Sites during the first nine (9) months of the first
year of the Term fails to exceed the amount per month specified on Exhibit
23(a), then LendingTree may terminate this Agreement by providing ninety (90)
days prior written notice of termination to CNBC.com at any time during the
final three (3) months of the first year of the Term.
(iv) Upon any Change of Control of LendingTree, by CNBC.com
upon thirty (30) days prior written notice to LendingTree.
(v) In the event that LendingTree does not obtain, on or
before 7:00 p.m. EST on January 21, 2000, the requisite shareholder approvals,
as described in Sections 6.3 and 6.4 of the Warrant Purchase Agreement, dated as
of the date hereof, between LendingTree and CNBC.com, or the Warrants have not
been issued prior to the effectiveness of LendingTree's initial public offering,
then CNBC.com may terminate this Agreement immediately upon written notice to
LendingTree.
(vi) In the event CNBC.com removes any of the licensed
LendingTree Content specified on Exhibit E hereto from the Exclusive Categories
pursuant to Sections 4(c) and 5, and LendingTree determines that such removal
materially adversely effects the quality of the Exclusive Categories.
(vii) In the event the compensation payable to CNBC.com is
determined not to be in compliance with RESPA, pursuant to the terms of Section
9(c).
(c) Consequences of Termination Resulting From CNBC.com Breach of
Section 3. If CNBC.com breaches Section 3 hereunder, CNBC.com shall refund to
LendingTree the amount specified on Schedule 23(c); provided, however, that such
refund shall constitute LendingTree's sole and exclusive remedy in connection
with such a breach. Notwithstanding anything stated herein, if this Agreement is
terminated for any reason by either party, all rights and licenses granted
pursuant to this Agreement shall immediately revert and be fully vested in
CNBC.com and LendingTree, as applicable. In such event, the parties shall return
to the other all intellectual property, software and related documentation, or
other goods provided hereunder.
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24. MISCELLANEOUS.
(a) Binding Nature and Assignment. This Agreement shall be binding
on the parties hereto and their respective successors and assigns, but neither
party may assign this Agreement without the prior written consent of the other;
provided, however, that this Agreement may be assigned by either party without
the consent of the other in connection with a merger or sale of all or
substantially all of its assets, or to a direct or indirect parent, subsidiary
or affiliate.
(b) Compliance with Law. Each party shall comply with all applicable
laws, codes, ordinances, rules and regulations of the federal, state and local
governments, and of any and all political subdivisions and regulatory
authorities thereof. Each party shall obtain all necessary permits and licenses
required in connection with the performance of it obligations hereunder.
(c) Notices. Any notice required or permitted by this Agreement
shall be in writing and shall be deemed sufficient upon receipt, when delivered
personally or by courier, overnight delivery service or confirmed facsimile, or
forty-eight (48) hours after being deposited in the regular mail as certified or
registered mail with postage prepaid, if such notice is addressed to the party
to be notified at such party's address or facsimile number as set forth below:
If to CNBC.com:
CNBC.com
2200 Fletcher Avenue
Fort Lee, New Jersey 07024
Attn: VP Business Development
Facsimile: 201-346-5200
with a copy to:
National Broadcasting Company, Inc.
30 Rockefeller Plaza
New York, New York 10112
Attn: Interactive Media Counsel
Facsimile: 212-977-7165
If to LendingTree:
LendingTree.com, Inc.
6701 Carmel Road, Suite 205,
Charlotte, North Carolina 28226.
Attention: Douglas R. Lebda, Chairman and CEO
Facsimile: 704-541-1824
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with a copy to:
LendingTree.com, Inc.
6701 Carmel Road, Suite 205,
Charlotte, North Carolina 28226.
Attention: Robert Flemma, General Counsel
Facsimile: 704-541-1824
Either party hereto may from time to time change its address for notification
purposes by giving the other prior written notice of the new address and the
date upon which it will become effective.
(d) Headings. The article and section headings used herein are for
reference and convenience only and shall not enter into the interpretation
hereof.
(e) Relationship of Parties. LendingTree, in furnishing services to
CNBC.com hereunder, is acting only as an independent contractor and assumes full
responsibilities for each of its employees and shall be solely responsible for
the payment of compensation to its personnel. This Agreement does not constitute
either party as the agent or legal representative of the other party and does
not create a partnership or joint venture between them.
(f) Severability. If any provision of this Agreement is declared or
found to be illegal, unenforceable or void, then both parties shall be relieved
of all obligations arising under such provision, but only to the extent that
such provision is illegal, unenforceable or void, it being the intent and
agreement of the parties that this Agreement shall be deemed amended by
modifying such provision to the extent necessary to make it legal and
enforceable while preserving its intent or, if that is not possible, by
substituting therefor another provision that is legal and enforceable and
achieves the same objective. If the remainder of this Agreement shall not be
affected by such declaration or finding and is capable of substantial
performance, then, each provision not so affected shall be enforced to the
extent permitted by law.
(g) Press Releases. CNBC.com agrees work together with LendingTree
to co-author a mutually agreeable press release related to this Agreement. To
the extent CNBC.com issues any press releases during the Term which describe
multiple strategic partnerships, it shall mention LendingTree if appropriate in
the circumstances. Except to the extent required by applicable law or as
otherwise specified herein, any use by one party of the other party's name,
trademarks or service marks in any press releases, customer lists, marketing
materials or other announcements concerning the matters covered by this
Agreement, or for promotional, advertising or other purposes, shall require the
other party's prior written approval.
(h) Waivers. No delay or omission by either party hereto to exercise
any right or power hereunder shall impair such right or power or be construed to
be a waiver thereof. A waiver by either of the parties hereto of any of the
covenants to be performed by the other or any
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breach thereof shall not be construed to be a waiver of any succeeding breach
thereof or of any other covenant herein contained. All remedies provided for in
this Agreement shall be cumulative and in addition to and not in lieu of any
other remedies available to either party at law, in equity or otherwise.
(i) Force Majeure. If the performance of this Agreement or any
obligation hereunder is prevented, restricted or interfered with by reason of
fire or other casualty or accident, acts of God, severe weather conditions, war
or other violence, any law, order, proclamation, regulation, ordinance, demand
or requirement of any governmental agency, or any other act or condition beyond
the reasonable control of the parties hereto, the party whose performance is so
affected shall be excused from such performance; provided, that if either party
invokes this Section for any consecutive period of thirty (30) days or longer,
then the other party may immediately terminate this Agreement without penalty,
upon written notice to such invoking party.
(j) Survival of Terms. Termination or expiration of this Agreement
for any reason shall not terminate any rights, liabilities or obligations that
have either accrued prior to the effective date of termination of this Agreement
or which the parties have expressly agreed shall survive any such termination or
expiration.
(k) Entire Agreement. This Agreement and each Exhibit attached
hereto, each of which is incorporated herein for all purposes, constitutes the
entire agreement between the parties hereto with respect to the subject matter
hereof, and there are no written or oral representations, understandings or
agreements relative hereto which are not fully expressed herein. This Agreement
and such Exhibits are intended to be the sole and exclusive statement of the
agreement between the parties hereto with respect to the subject matter hereof
and any other terms or conditions included in any forms utilized or exchanged by
the parties hereto shall be of no force or effect and shall not be incorporated
herein or be binding unless expressly agreed to in writing by both parties
hereto. No change, amendment, waiver or discharge hereof shall be valid unless
in writing and signed by an authorized representative of the party against which
such change, amendment, waiver or discharge is sought to be enforced.
(l) Governing Law; Jurisdiction. This Agreement and all acts and
transactions pursuant hereto and the rights and obligations of the parties
hereto shall be governed, construed and interpreted in accordance with the laws
of the State of New York, without giving effect to principles of conflicts of
law. Each of the parties to this Agreement consents to the exclusive
jurisdiction and venue of the state and federal courts of New York County, New
York.
(m) Counterparts. This Agreement may be executed in two or more
counterparts, each of which shall be deemed an original and all of which
together shall constitute one instrument.
[Signatures appear on the following page.]
22
<PAGE> 23
IN WITNESS WHEREOF, LendingTree and CNBC.com have each caused this Co-Branded
Site Agreement to be executed and delivered by its duly authorized officer, to
be effective as of the Effective Date.
CNBC.COM LLC LENDINGTREE.COM, INC.
- ------------------------------ -------------------------------
Signature Signature
- ------------------------------ -------------------------------
Printed Name Printed Name
- ------------------------------ -------------------------------
Title Title
23
<PAGE> 24
Exhibit A to
Co-Branded Site Agreement
NBC Marks
To be provided by CNBC.com from time to time.
24
<PAGE> 25
Exhibit B to
Co-Branded Site Agreement
Attribution Standards
A text link will appear below CNBC.com's Attribution Line on every page of the
Co-Branded Sites. The logo shall be 30x10 pixels and the attribution text link
shall be in 8-point font, and shall appear as follows:
(C) [Year] LendingTree.com, Inc.
The attribution text shall link to an attribution page (the "Attribution Page")
which shall reside on CNBC.com's servers. The Attribution Page shall contain
content to be mutually agreed upon by LendingTree and CNBC.com but shall not
contain a link to the LendingTree Site; provided, that the Attribution Page
shall not contain any other links, advertisements or promotions of third party
products or services, or any other material which is not directly relevant to
LendingTree, CNBC or CNBC.com. CNBC.com and LendingTree will mutually agree upon
standards for the timeliness of updates to the Attribution Page. Updates may
include, but are not limited to new copy or new graphical elements.
25
<PAGE> 26
Exhibit C to
Co-Branded Site Agreement
Service Level Agreement
CNBC.com and LendingTree agree that this Service Level Agreement
specifies the standards applicable to the hosting and maintenance services
LendingTree is to provide pursuant to Section 15 of the Agreement (the
"Standards"). These Standards are intended to: (i) enable CNBC.com to understand
clearly what level of service to expect from LendingTree, (ii) enable
LendingTree to understand clearly what level of service to provide to CNBC.com,
and (iii) define what measures and actions should be taken if that level of
service is not provided.
1. Telephone Support. LendingTree shall make available via telephone at a
toll-free number between the hours of 8:00 a.m. and 6:00 p.m. ET, Monday through
Friday, excluding national holidays, qualified personnel to advise CNBC.com in
connection with any unavailability, malfunction or defect in the Co-Branded
Sites or any User's experience with the Co-Branded Sites.
2. Uptime. Except for regular scheduled maintenance which shall occur
between the hours of 2:00 a.m. and 5:00 a.m. ET, the Co-Branded Sites shall be
available and accessible to Users 99.5% of the time during the Term. For each
aggregate one (1) hour period within one (1) calendar day that the Co-Branded
Sites is not available to Users between the hours of 6:00 a.m. and 7:59 p.m. ET,
LendingTree shall pay to CNBC.com the amount of $500.00. For each aggregate one
(1) hour period within one (1) calendar day that the Co-Branded Sites are not
available to Users between the hours of 8:00 p.m. and 5:59 a.m. ET when the
CNBC.com Site is available, LendingTree shall pay to CNBC.com the amount of
$250.00.
3. Monitoring. LendingTree shall monitor the performance characteristics of
the Co-Branded Sites. LendingTree shall promptly notify CNBC.com of any problem
with the Co-Branded Sites and CNBC.com shall notify LendingTree of any problems
it learns of with the Co-Branded Sites. Upon learning of or receiving notice of
a problem with the Co-Branded Sites, LendingTree qualified personnel shall
promptly consult with CNBC.com to assign a severity level to the problem as
follows:
Severity Level 1 - The Co-Branded Sites are wholly or substantially
inoperable or interrupted.
Severity Level 2 - The Co-Branded Sites remain usable with some
limitation or degradation of functionality (i.e., normal activities are
measurable impacted).
Severity Level 3 - The Co-Branded Sites experience a minor error and the
impact to normal activities is minimal.
26
<PAGE> 27
4. Remedying Problems. After classifying the severity of a problem as set
forth in Section 3 of this Exhibit C, LendingTree shall provide the following
resources to remedy such problem:
- - Severity Level 1 problems shall be given the highest priority of
resolution. LendingTree shall, immediately upon classifying a problem as
a Severity Level 1 problem, begin development of a resolution plan and
notify CNBC.com of the status of the problem and the remedy within thirty
(30) minutes. LendingTree shall use best efforts on a 24x7 basis to
resolve a Severity Level 1 problem. Resolution of Severity Level 1
problems shall occur within one (1) hour.
- - Severity Level 2 problems shall be given a medium priority of resolution.
LendingTree shall, within thirty (30) minutes of classifying a problem as
a Severity Level 2 problem, begin development of a resolution plan and
notify CNBC.com of the status of the problem and the proposed resolution.
LendingTree shall resolve Severity Level 2 problems within three (3)
hours.
- - Severity Level 3 problems shall be given the lowest priority of
resolution and LendingTree shall resolve Severity Level 3 problems within
five (5) hours.
If a permanent repair cannot be made, a temporary resolution (bypass and
recovery) will be implemented and a permanent repair implemented thereafter as
soon as possible. LendingTree shall maintain a sufficient staff and resources in
order to achieve the high level of service described in this Agreement and this
Exhibit C. In the event of multiple problems or requests from other partners of
LendingTree, resources shall be allocated on a priority basis to CNBC.com.
In the event that LendingTree fails to resolve any Severity Level 1 or 2 problem
within the resolution times set forth in Section 4 of this Exhibit C, then
LendingTree shall pay to CNBC.com $500.00 for each one (1) hour period beyond
the specified resolution time that the problem remains unresolved. In the event
that LendingTree fails to resolve any Severity Level 3 problem within the
resolution time specified in Section 4 of this Exhibit C, LendingTree shall pay
to CNBC.com $250.00 for each one (1) hour period beyond the specified resolution
time that the problem remains unresolved.
Any amounts payable by LendingTree pursuant to this Exhibit C shall be paid by
LendingTree to CNBC.com within ten (10) days of the occurrence of the event from
which the payment arises.
27
<PAGE> 28
Exhibit D to
Co-Branded Site Agreement
Advertising Buy on CNBC Television Network
1. Gross expenditures:
a) 2000: $2,366,617
b) 2001: $2,366,617
2. HH CPM
a) 2000: *****
b) 2001: *****
3. *****
a) Business Day (MF 430a-730p) *****
4. Daypart Distribution
a) 100% Business Day
5. Cancellation Options
a) Each year is treated as separate one-year deals:
b) 70% total firm with 1st Qtr 100% firm and each subsequent Qtrs.
between 50%-75% firm to reach a yearly total of 70% firm.
c) Option notification date is 60 days prior to start of Qtr
6. Year #2 Negotiation
a) The 2001 buy must be negotiated and ordered by 6/23/00
Note: Due to inventory constraints, exact number of units and programs subject
to availabilities at the time of order.
- --------------
***** Confidential treatment has been requested for the redacted portions. The
confidential redacted portions have been filed separately with the
Securities and Exchange Commission.
28
<PAGE> 29
Exhibit E to
Co-Branded Site Agreement
Essential LendingTree Content
Links to the LendingTree Site from the Co-Branded Sites as specified in Section
13(a).
29
<PAGE> 30
Schedule 9(a) to
Co-Branded Site Agreement
Fee Per Click-Through
*****
- --------------
***** Confidential treatment has been requested for the redacted portions. The
confidential redacted portions have been filed separately with the
Securities and Exchange Commission.
30
<PAGE> 31
Schedule 11(a) to
Co-Branded Site Agreement
Marketing Support
1. Banners, buttons and text links: *****
2. Targeted e-mail banners: *****
3. Advertising inventory: *****
4. Additional Marketing Support: *****
- --------------
***** Confidential treatment has been requested for the redacted portions. The
confidential redacted portions have been filed separately with the
Securities and Exchange Commission.
31
<PAGE> 32
Schedule 11(b) to
Co-Branded Site Agreement
Co-op Support
*****
- --------------
***** Confidential treatment has been requested for the redacted portions. The
confidential redacted portions have been filed separately with the
Securities and Exchange Commission.
32
<PAGE> 33
Schedule 23(a) to
Co-Branded Site Agreement
Termination Threshold
******
- --------------
***** Confidential treatment has been requested for the redacted portions. The
confidential redacted portions have been filed separately with the
Securities and Exchange Commission.
33
<PAGE> 34
Schedule 23(c) to
Co-Branded Site Agreement
Refund Amount
******% of the Advertising Fees as of the date of such breach
- --------------
***** Confidential treatment has been requested for the redacted portions. The
confidential redacted portions have been filed separately with the
Securities and Exchange Commission.
34
<PAGE> 1
EXHIBIT 10.16
LENDINGTREE, INC.
WARRANT PURCHASE AGREEMENT
JANUARY 14, 2000
<PAGE> 2
TABLE OF CONTENTS
<TABLE>
<CAPTION>
Page
----
<S> <C>
SECTION 1
AUTHORIZATION AND SALE OF WARRANTS................................................1
1.1 AUTHORIZATION OF WARRANTS...........................................1
1.2 ISSUANCE OF WARRANTS................................................1
1.3 STOCKHOLDERS AGREEMENT..............................................2
1.4 REGISTRATION RIGHTS AGREEMENTS......................................2
SECTION 2
CLOSING DATES; DELIVERY...........................................................2
2.1 CLOSING.............................................................2
SECTION 3
REPRESENTATIONS AND WARRANTIES OF THE COMPANY.....................................2
3.1 ORGANIZATION AND STANDING; ARTICLES AND BYLAWS......................2
3.2 CORPORATE POWER.....................................................2
3.3 CAPITALIZATION......................................................3
3.4 AUTHORIZATION.......................................................3
SECTION 4
REPRESENTATIONS, WARRANTIES AND COVENANTS OF THE PURCHASER........................4
4.1 ACCREDITED INVESTOR; EXPERIENCE; RISK...............................4
4.2 INVESTMENT..........................................................4
4.3 RESTRICTED SECURITIES; RULE 144.....................................4
4.4 NO PUBLIC MARKET....................................................5
4.5 AUTHORIZATION.......................................................5
4.6 FURTHER LIMITATIONS ON DISPOSITION..................................5
4.7 LEGENDS.............................................................5
SECTION 5
COVENANTS OF THE STOCKHOLDERS.....................................................6
5.1 SHAREHOLDER APPROVAL................................................6
5.2 CONFIDENTIAL TREATMENT REQUEST......................................6
5.3 MODIFICATION OF WARRANT.............................................6
5.4 STOCK SPLIT.........................................................6
SECTION 6
CONDITIONS PRECEDENT TO THE OBLIGATIONS OF THE COMPANY AND THE PURCHASER..........7
6.1 REPRESENTATIONS AND WARRANTIES TRUE.................................7
</TABLE>
<PAGE> 3
<TABLE>
<CAPTION>
Page
----
<S> <C>
6.2 PERFORMANCE OF COVENANTS............................................7
6.3 WAIVER OF PREEMPTIVE RIGHTS.........................................7
6.4 CONSENT TO GRANT OF REGISTRATION RIGHTS.............................7
6.5 JOINDER TO REGISTRATION RIGHTS AGREEMENT............................7
6.6 JOINDER TO STOCKHOLDERS AGREEMENT...................................7
SECTION 7
MISCELLANEOUS.....................................................................8
7.1 GOVERNING LAW.......................................................8
7.2 TERMINATION.........................................................8
7.3 PRESS RELEASE.......................................................8
7.4 SURVIVAL............................................................8
7.5 SUCCESSORS AND ASSIGNS..............................................8
7.6 ENTIRE AGREEMENT; AMENDMENT.........................................8
7.7 NOTICES, ETC........................................................8
7.8 DELAYS OR OMISSIONS.................................................9
7.9 EXPENSES............................................................9
7.10 COUNTERPARTS.......................................................10
7.11 SEVERABILITY.......................................................10
</TABLE>
ii
<PAGE> 4
LENDINGTREE, INC.
WARRANT PURCHASE AGREEMENT
This Agreement is made as of January 14, 2000, between LENDINGTREE, INC.,
a Delaware corporation (the "COMPANY"), and CNBC.COM LLC, a Delaware limited
liability company (the "PURCHASER").
RECITALS
WHEREAS, the Company and Purchaser desire to enter into a Co-Branded Site
Agreement, dated even date hereof (the "SITE AGREEMENT"), which contemplates,
among other things, the issuance of warrants to purchase the Company's common
stock as described herein as partial consideration for the value to be provided
by the Purchaser under the Site Agreement;
WHEREAS, the Company desires to issue, and the Purchaser desires to
receive, two warrants (the "WARRANTS") to purchase an aggregate of 150,000
shares of the Company's Common Stock, par value $0.01 (the "COMMON STOCK"), at
an exercise price of $10.00 per share. The immediately exercisable Warrant
("Immediate Warrant") will be in the form attached hereto as Exhibit A. The
delayed exercise Warrant ("Delayed Warrant") will be in the form attached hereto
as Exhibit B; and
WHEREAS, the Purchaser will execute joinders to each of the Registration
Rights Agreement, dated September 20, 1999, by and among the Company and certain
stockholders (the "REGISTRATION RIGHTS AGREEMENT"), and the Stockholders
Agreement, dated September 20, 1999, by and among the Company and certain
stockholders (the "STOCKHOLDERS AGREEMENT").
NOW, THEREFORE, THE PARTIES AGREE AS FOLLOWS:
SECTION 1
AUTHORIZATION AND SALE OF WARRANTS
1.1 AUTHORIZATION OF WARRANTS. The Company has authorized the issuance
of the Warrants and has reserved 150,000 shares of Common Stock for issuance
upon the exercise of the Warrants.
1.2 ISSUANCE OF WARRANTS. Subject to the terms and conditions hereof,
the Company will issue to the Purchaser at the Closing, and the Purchaser will
receive at the Closing, the Warrants.
<PAGE> 5
1.3 STOCKHOLDERS AGREEMENT. At the Closing (as defined in Section 2.1)
of the transactions contemplated hereby pursuant to Section 2.1 hereof, the
parties will execute a joinder to the Stockholders Agreement (the "JOINDER TO
THE STOCKHOLDERS AGREEMENT"), in the form attached hereto as Exhibit D.
1.4 REGISTRATION RIGHTS AGREEMENTS. At the Closing of the transactions
contemplated hereby pursuant to Section 2.1 hereof, the parties will execute a
joinder to the Registration Rights Agreement (the "JOINDER TO THE REGISTRATION
RIGHTS AGREEMENT"), in the form attached hereto as Exhibit E.
SECTION 2
CLOSING DATES; DELIVERY
2.1 CLOSING. The closing of the issuance of the Warrants hereunder
(the "CLOSING") shall take place (i) at the offices of Skadden, Arps, Slate,
Meagher & Flom LLP, Four Times Square, New York, NY 10036 but in any event
within three business days after the day on which the last to be fulfilled or
waived of the conditions set forth in Section 5 shall be fulfilled or waived in
accordance with this agreement or (ii) at such other time and place upon which
the Company and the Purchaser shall agree (the date of the Closing is
hereinafter referred to as the "CLOSING DATE"). At the Closing, the Company will
deliver to the Purchaser the Warrants provided the Site Agreement has been duly
executed and delivered by the Purchaser.
SECTION 3
REPRESENTATIONS AND WARRANTIES OF THE COMPANY
3.1 ORGANIZATION AND STANDING; ARTICLES AND BYLAWS. The Company is a
corporation duly organized and existing under the laws of the State of Delaware
and is authorized to exercise all its corporate powers, rights and privileges
and is in good legal standing in the State of Delaware. The Company has
furnished the Purchaser true and complete copies of its Certificate of
Incorporation, as amended, and Bylaws, as amended.
3.2 CORPORATE POWER. The Company has all requisite legal and corporate
power to execute and deliver this Agreement, the Warrants, the Joinder to the
Stockholders Agreement, the Joinder to the Registration Rights Agreement, the
Site Agreement and to issue the Warrants hereunder, to carry out and perform its
obligations under the terms hereunder and under the Warrants, the Joinder to the
Stockholders Agreement, the Joinder to the Registration Rights Agreement and the
Site Agreement.
2
<PAGE> 6
3.3 CAPITALIZATION. The authorized capital stock of the Company, upon
the consummation of the Closing, consists of 30,000,000 shares of Common Stock,
2,458,018 shares of which are issued and outstanding, 3,049,031 shares of Series
A Convertible Preferred Stock, par value $0.01 per share, 1,789,861 of which are
issued and outstanding, 911,450 shares of Series B Convertible Preferred Stock,
par value $0.01 per share, of which no shares are issued and outstanding,
268,074 shares of Series C Convertible Preferred Stock, par value $0.01 per
share, of which no shares are issued and outstanding, and 6,238,639 shares of
Series D Convertible Preferred Stock, par value $0.01 per share, 6,238,172 of
which are issued and outstanding. All such issued and outstanding shares have
been duly authorized and validly issued, and are fully paid and nonassessable
and have been issued in compliance with federal and state securities law. Except
as contemplated herein, as of the date hereof, there are no options, warrants,
conversion privileges or other rights presently outstanding to purchase or
otherwise acquire any authorized but unissued shares of the capital stock or
other securities of the Company, nor any agreements or understandings with
respect thereto, other than (i) options to purchase 2,903,968 shares of Common
Stock granted to eligible participants under the Company's benefit plans and
(ii) warrants to purchase 525,500 shares of Common Stock. The Common Stock
issuable upon exercise of the Warrants (i.e. 150,000 shares) constitute at least
1% of the fully-diluted capital stock of the Company.
3.4 AUTHORIZATION. All corporate action on the part of the Company,
its directors and stockholders necessary for the authorization, execution,
delivery and performance of this Agreement, the Warrants, the Joinder to the
Stockholders Agreement, the Joinder to the Registration Rights Agreement and the
Site Agreement by the Company, the authorization, sale, issuance (or reservation
for issuance) and delivery of the Warrants issued or issuable hereunder and the
Common Stock issuable upon exercise thereof and the performance of the Company's
obligations hereunder have been taken or will be taken prior to the Closing.
This Agreement, the Warrants, the Joinder to the Stockholders Agreement, the
Joinder to the Registration Rights Agreement and the Site Agreement, when
executed and delivered by the Company, shall constitute valid and binding
obligations of the Company enforceable in accordance with their respective
terms, subject to laws of general application relating to bankruptcy, insolvency
and the relief of debtors, and rules of law governing specific performance,
injunctive relief or other equitable remedies. The Common Stock issuable upon
exercise of the Warrants will have been duly and validly reserved for issuance,
and upon issuance will be duly and validly issued, fully paid and nonassessable
and will be free of restrictions on transfer; provided, however, that the
Warrants and the Common Stock issuable upon exercise of the Warrants
(collectively, the "SECURITIES") may be subject to restrictions on transfer
under state and/or federal securities laws as set forth herein and in the
Stockholders Agreement. Except as set forth in the Stockholders Agreement, the
Securities are not subject to any preemptive rights or rights of first refusal.
3
<PAGE> 7
SECTION 4
REPRESENTATIONS, WARRANTIES AND COVENANTS OF THE PURCHASER
The Purchaser hereby represents, warrants and covenants to the Company
with respect to the receipt of the Warrant, as follows:
4.1 ACCREDITED INVESTOR; EXPERIENCE; RISK. The Purchaser is an
accredited investor within the definition of Regulation D of the Securities Act
of 1933. The Purchaser and its representatives have been solely responsible for
the Purchaser's own "due diligence" investigation of the Company and its
management and business, for its own analysis of the merits and risks of the
investment, and for its own analysis of the fairness and desirability of the
terms of the investment. The Purchaser has such knowledge and experience in
financial and business matters that such Purchaser is capable of evaluating the
merits and risks associated with the receipt of the Warrant pursuant to the
Agreement and of protecting the Purchaser's interests in connection therewith.
The Purchaser is able to fend for himself in the transactions contemplated by
this Agreement and has the ability to bear the economic risk of the investment,
including complete loss of the investment. The Purchaser is experienced in
evaluating and investing in new, high-technology companies such as the Company.
4.2 INVESTMENT. The Purchaser is acquiring the Warrants for investment
for its own account, not as a nominee or agent, and not with a view to, or for
resale in connection with, any distribution thereof, and the Purchaser has no
present intention of selling, granting any participation in, or otherwise
distributing the same in violation of applicable law. The Purchaser understands
that the Warrants to be purchased, and the Common Stock issuable upon exercise
of the Warrants, have not been and will not have been registered under the
Securities Act by reason of a specific exemption from the registration
provisions of the Securities Act which depends upon, among other things, the
bona fide nature of the investment intent and the accuracy of such Purchaser's
representations as expressed herein.
4.3 RESTRICTED SECURITIES; RULE 144. The Purchaser understands that
the Securities are characterized as "restricted securities" under the federal
securities laws inasmuch as they are being acquired from the Company in a
transaction not involving a public offering and that under such laws and
applicable regulations the Securities may be resold without registration under
the Securities Act only in certain limited circumstances. The Purchaser
acknowledges that the Securities must be held indefinitely unless subsequently
registered under the Securities Act or an exemption from such registration is
available. The Purchaser is aware of the provisions of Rule 144 promulgated
under the Securities Act, which permit limited resale of shares purchased in a
private placement subject to the satisfaction of certain conditions, including,
among other things, the existence of a public market for the shares, the
availability of certain current public information about the Company, the resale
occurring not less than one (1) year after a party has purchased and paid for
the security to be sold, the sale being effected through a "broker's
transaction" or in transactions directly with a "market maker" (as provided by
Rule 144(f)) and
4
<PAGE> 8
the number of shares being sold during any three (3) month period not exceeding
specified limitations.
4.4 NO PUBLIC MARKET. The Purchaser understands that no public market
now exists for any of the securities issued by the Company and that there is no
assurance that a public market will ever exist for the Securities.
4.5 AUTHORIZATION. The Purchaser represents that it has the full
right, power and authority to enter into and perform the Purchaser's obligations
under this Agreement, and this Agreement when executed and delivered by the
Purchaser will constitute a valid and binding obligation of the Purchaser,
enforceable in accordance with its terms, subject to the laws of general
application relating to bankruptcy, insolvency and the relief of debtors, rules
of law governing specific performance, injunctive relief or other equitable
remedies.
4.6 FURTHER LIMITATIONS ON DISPOSITION. Without in any way limiting
the representations set forth above, the Purchaser further agrees not to make
any disposition of all or any portion of the Securities unless and until the
Purchaser shall have complied with Articles III and V of the Stockholders
Agreement and either:
(a) There is then in effect a Registration Statement under the
Securities Act covering such proposed disposition and such disposition is made
in accordance with such Registration Statement; or
(b) (i) The Purchaser shall have notified the Company of the
proposed disposition and shall have furnished the Company with a detailed
statement of the circumstances surrounding the proposed disposition, and (ii) if
reasonably requested by the Company, such Purchaser shall have furnished the
Company with an opinion of counsel, reasonably satisfactory to the Company, that
such disposition will not require registration under the Act.
4.7 LEGENDS. It is understood that each certificate representing the
Common Stock issued upon exercise of the Warrant shall bear legends in the
following forms or substantially similar form (in addition to any legend
required under applicable state securities laws):
"THESE SECURITIES HAVE NOT BEEN REGISTERED UNDER THE SECURITIES
ACT OF 1933, AND HAVE BEEN ACQUIRED FOR INVESTMENT AND NOT WITH A
VIEW TO, OR IN CONNECTION WITH, THE SALE OR DISTRIBUTION THEREOF.
NO SUCH SALE OR DISPOSITION MAY BE EFFECTED WITHOUT AN EFFECTIVE
REGISTRATION STATEMENT RELATED THERETO OR AN OPINION OF COUNSEL
REASONABLY SATISFACTORY TO THE COMPANY THAT SUCH REGISTRATION IS
NOT REQUIRED UNDER THE SECURITIES ACT OF 1933."
5
<PAGE> 9
[in the case of the Common Stock issuable upon exercise of the
Warrant]
"THE SHARES REPRESENTED BY THIS CERTIFICATE ARE SUBJECT TO CERTAIN
RESTRICTIONS ON TRANSFER AS SET FORTH IN THE STOCKHOLDERS
AGREEMENT BETWEEN THE COMPANY AND THE ORIGINAL HOLDER OF THESE
SHARES, A COPY OF WHICH MAY BE OBTAINED AT THE PRINCIPAL OFFICE OF
THE COMPANY. SUCH TRANSFER RESTRICTIONS ARE BINDING ON TRANSFEREES
OF THESE SHARES."
SECTION 5
COVENANTS OF THE STOCKHOLDERS
The Company covenants that:
5.1 SHAREHOLDER APPROVAL. The Company shall use commercially
reasonable efforts to receive the requisite shareholder approvals, consents and
waivers, as required by the Stockholders Agreement and the Registration Rights
Agreement, by Friday, January 21, 2000.
5.2 CONFIDENTIAL TREATMENT REQUEST. The Company shall file a request
for confidential treatment by 10:15 a.m., Tuesday, January 18, 2000 with the
Securities and Exchange Commission requesting confidential treatment for all
items set forth in Item 2 of Exhibit D, Item 3 of Exhibit D and the Schedules to
the Site Agreement (the "Confidential Information"). The Company shall use
commercially reasonable efforts to receive confidential treatment for all items
set forth in the Schedules to the Site Agreement.
5.3 MODIFICATION OF WARRANT. In the event the Company fails to (i)
file a confidential treatment request as provided by Section 5.2 or (ii) receive
confidential treatment with respect to the dollar amounts set forth in Item 2 of
Exhibit D, the percentages set forth in Item 3 of Exhibit D, Schedule 9(c) and
Schedule 23(a) to the Site Agreement from the Securities and Exchange Commission
addressing the merits of the Confidentiality Request prior to filing the Site
Agreement with the Confidential Information as an exhibit to a Registration
Statement filed with the Securities and Exchange Commission pursuant to the
Securities Act of 1933, as amended, the Company shall issue a warrant (the
"Revised Warrant") at the Closing in the form of Exhibit C attached hereto in
lieu of the Delayed Warrant. In the event the Delayed Warrant shall have been
previously executed and delivered to the Purchaser, the Company shall
immediately execute and deliver the Revised Warrant upon the surrender by the
Purchaser of the Delayed Warrant.
5.4 STOCK SPLIT. In the event that the Company shall, prior to
Closing, (i) pay a dividend or make a distribution on its Common Stock, (ii)
subdivide shares of its outstanding Common Stock into a greater number of
shares, (iii) combine its outstanding Common Stock into a smaller number of
shares, or (iv) issue any shares of its capital stock by reclassification of its
Common Stock
6
<PAGE> 10
(including any such reclassification in connection with a consolidation or
merger in which the Company is the continuing corporation), the Warrants
attached hereto shall be modified to entitle the Purchaser to purchase the
aggregate number and kind of shares which, if the Warrant had been exercised at
the Exercise Price in effect immediately prior to such event, the Purchaser
would have owned upon such exercise and been entitled to receive by virtue of
such dividend, distribution, subdivision, combination or reclassification; and
the Exercise Price, as defined in the Warrants, shall automatically be adjusted
immediately, in the case of a dividend or distribution, or the effective date,
in the case of a subdivision, combination or reclassification, to allow the
purchase of such aggregate number and kind of shares. For example, in the event
that the Company implements a stock split of 1.27 for 1 prior to the Closing,
each of the Warrants shall entitle the Purchaser to purchase 95,250 shares of
Common Stock at an Exercise Price of $7.87.
SECTION 6
CONDITIONS PRECEDENT TO THE OBLIGATIONS OF THE COMPANY AND THE PURCHASER
The obligations of the Company and Purchaser to effect the Closing
hereunder are subject to the satisfaction, at or prior to the Closing, of all of
the following conditions:
6.1 REPRESENTATIONS AND WARRANTIES TRUE. The representations,
warranties set forth in this Agreement shall be true and accurate as of the date
when made and shall be deemed to be made again at and as of the Closing and
shall then be true and accurate (except for changes contemplated by this
Agreement and except for representations and warranties that by their terms
speak as of the date of this Agreement or some other date which shall be true
and correct only as of such date).
6.2 PERFORMANCE OF COVENANTS. The Company and the Purchaser shall have
performed and complied with each and every covenant, agreement and condition
required by this Agreement to be performed or complied with by it prior to or on
the Closing Date, provided however, the failure of the Company to receive a
definitive response from the Securities and Exchange Commission, as described in
Section 6.2, prior to the Closing does not constitute non-performance of the
covenant set forth in Section 6.2.
6.3 WAIVER OF PREEMPTIVE RIGHTS. The Company shall have received a
waiver of the preemptive rights set forth in section 3.1 of the Stockholders
Agreement as required by section 8.9 of the Stockholders Agreement.
6.4 CONSENT TO GRANT OF REGISTRATION RIGHTS. The Company shall have
received the written consent as required by the Registration Rights Agreement,
dated September 20, 1999, by the holders of a requisite approval pursuant to
Section 2.5 of the Registration Rights Agreement the Company shall have received
the consent of at least 50% of all Holders of Preferred Stock of the Company.
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6.5 JOINDER TO REGISTRATION RIGHTS AGREEMENT. The Company shall have
received a Joinder to the Registration Rights Agreement executed by the
Purchaser.
6.6 JOINDER TO STOCKHOLDERS AGREEMENT. The Company shall have received
a Joinder to the Stockholders Agreement executed by the Purchaser.
SECTION 7
MISCELLANEOUS
7.1 GOVERNING LAW. This Agreement shall be governed in all respects by
the laws of the State of New York.
7.2 TERMINATION. This Agreement may be terminated upon written notice
by the Purchaser if the requisite shareholder approvals, as described in
Sections 6.3 and 6.4, have not been received by 7:00 p.m. EST, Friday, January
21, 2000.
7.3 PRESS RELEASE. Neither the Purchaser nor the Company shall issue
any press release prior to the Closing which relates to this Agreement or any
other arrangements in connection with the transactions contemplated hereby.
7.4 SURVIVAL. The representations, warranties, covenants and
agreements made herein shall survive any investigation made by the Purchaser and
the closing of the transactions contemplated hereby.
7.5 SUCCESSORS AND ASSIGNS. Except as otherwise provided herein, the
provisions hereof shall inure to the benefit of, and be binding upon, the
successors, assigns, heirs, executors and administrators of the parties hereto.
7.6 ENTIRE AGREEMENT; AMENDMENT. This Agreement and the other
documents delivered pursuant hereto constitute the full and entire understanding
and agreement between the parties with regard to the subjects hereof and
thereof. Neither this Agreement nor any term hereof may be amended, waived,
discharged or terminated other than by a written instrument signed by the
Company and by persons holding a majority of the Shares.
7.7 NOTICES, ETC. All notices and other communications required or
permitted hereunder shall be in writing and shall be mailed by registered or
certified mail, postage prepaid, or otherwise delivered by hand or by messenger,
addressed as follows:
If to the Purchaser:
CNBC.com LLC
2200 Fletcher Avenue
Fort Lee, New Jersey 07024
<PAGE> 12
Facsimile: (201) 346-5200
Attention: VP Business Development
with a copy to:
National Broadcasting Company, Inc.
30 Rockefeller Plaza
New York, New York 10112
Facsimile: (212) 977-7165
Attention: VP, Law, Corporate Transactions
If to the Company and prior to -, 2000:
LendingTree
6701 Carmel Road, Suite 205
Charlotte, NC 28226
Fax: (704) 541-1824
Attention: CEO
If to the Company and after -, 2000:
LendingTree
11111 Rushmore Drive
Charlotte, NC 28226
Fax: (704) -
Attention: CEO
with a copy to:
Skadden, Arps, Slate, Meagher & Flom LLP
Four Times Square
New York, NY 10036
Fax: (212) 735-2000
Attention: David Goldschmidt
7.8 DELAYS OR OMISSIONS. No delay or omission to exercise any right,
power or remedy accruing to any holder of any Warrants, upon any breach or
default of the Company under this Agreement, shall impair any such right, power
or remedy of such holder nor shall it be construed to be a waiver of any such
breach or default, or an acquiescence therein, or of or in any similar breach or
default thereafter occurring; nor shall any waiver of any single breach or
default be deemed a waiver of any other breach or default theretofore or
thereafter occurring. Any waiver, permit, consent or approval of any kind or
character on the part of any holder of any breach or default under this
Agreement, or any waiver on the part of any holder of any provisions
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or conditions of this Agreement, must be in writing and shall be effective only
to the extent specifically set forth in such writing. All remedies, either under
this Agreement or by law or otherwise afforded to any holder, shall be
cumulative and not alternative.
7.9 EXPENSES. The Company and the Purchaser shall bear its own
expenses and legal fees incurred on their behalf with respect to this Agreement
and the transactions contemplated hereby.
7.10 COUNTERPARTS. This Agreement may be executed in any number of
counterparts, each of which shall be enforceable against the parties actually
executing such counterparts, and all of which together shall constitute one
instrument.
7.11 SEVERABILITY. In the event that any provision of this Agreement
becomes or is declared by a court of competent jurisdiction to be illegal,
unenforceable or void, this Agreement shall continue in full force and effect
without said provision; provided, however, that no such severability shall be
effective if it materially changes the economic benefit of this Agreement to any
party.
The foregoing Warrant Purchase Agreement is hereby executed as of the
date first above written.
"COMPANY" LENDINGTREE, INC.,
By:
----------------------------------
Name: Douglas Lebda
Title: Chief Executive Officer
"PURCHASER" CNBC.COM LLC
By:
----------------------------------
Name:
Title:
10
<PAGE> 14
EXHIBIT A
Form of Immediate Warrant
<PAGE> 15
EXHIBIT B
Form of Delayed Warrant
<PAGE> 16
EXHIBIT C
Form of Revised Warrant
<PAGE> 17
EXHIBIT D
Joinder to the Stockholders Agreement
<PAGE> 18
EXHIBIT E
Joinder to the Registration Rights Agreement
