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AGREEMENT AND PLAN OF
CONTRIBUTION, INVESTMENT AND MERGER
This Agreement and Plan of Contribution, Investment and Merger, dated
as of May 9, 1999 (hereinafter, the "Agreement"), among National Broadcasting
---------
Company, Inc., a Delaware corporation ("NBC"), GE Investments Subsidiary, Inc.,
---
a Delaware corporation ("GE Investments Sub"), Neon Media Corporation, a
------------------
Delaware corporation ("NMC"), Xenon 2, Inc., a Delaware corporation ("Xenon 2")
--- -------
and XOOM.com, Inc., a Delaware corporation ("Xoom").
----
W I T N E S S E T H:
WHEREAS, NBC owns all of the outstanding capital stock of NBC
Multimedia, Inc., a Delaware corporation ("NBC Multimedia");
--------------
WHEREAS, NBC Multimedia formed NMC for the purpose of effecting the
transactions contemplated by this Agreement and all of its outstanding capital
stock is owned by NBC Multimedia;
WHEREAS, Xoom, Xenon 2, Xenon 3, Inc., a Delaware corporation ("Xenon
-----
3"), SNAP! LLC, a Delaware limited liability company ("SNAP") and CNET, Inc., a
- ----
Delaware corporation ("CNET"), are parties to an Agreement and Plan of
----
Contribution and Merger dated as of the date hereof (the "Xenon 2 Merger
--------------
Agreement") pursuant to which, among other things, the parties thereto have
---------
agreed that (i) Xenon 3 will merge with and into Xoom, with Xoom as the
surviving corporation, and each outstanding share of common stock of Xoom, par
value $0.0001 per share, will be converted into the right to receive one share
of Class A Common Stock of Xenon 2 and (ii) CNET will contribute to Xenon 2
certain assets in exchange for shares of Class A Common Stock of Xenon 2;
WHEREAS, Xoom owns all of the outstanding capital stock of Xenon 2,
and Xenon 2 owns all of the outstanding stock of Xenon 3;
WHEREAS, the closing of the transactions contemplated by the Xenon 2
Merger Agreement is a condition to the closing of the transactions contemplated
by this Agreement;
WHEREAS, while the closing under the Xenon 2 Merger Agreement and the
closing under this Agreement are not contingent on each other, it is intended
that both transactions represent a series of steps in the formation of Xenon 2
whereby the rights of all the parties are defined;
WHEREAS, the consummation of the transactions contemplated by the
Xenon 2 Merger Agreement and this Agreement would combine certain assets of NBC
and CNET with the existing business of Xoom in a new holding company structure
intended to achieve important business objectives;
<PAGE>
2
WHEREAS, the Board of Directors of each of Xoom, Xenon 2 and Xenon 3
believe it is advisable for such parties to enter into this Agreement and to
consummate the transactions provided for herein;
WHEREAS, concurrently with the execution hereof, in order to induce
NBC to enter into this Agreement, NBC, Xoom and certain stockholders of Xoom
are entering into a voting agreement providing for certain voting and other
restrictions with respect to shares of Xoom common stock owned by such
stockholders, all upon the terms and conditions specified therein; and
WHEREAS, NBC, GE Investments Sub, NMC, Xoom and Xenon 2 desire to make
certain representations, warranties, covenants and other agreements in
connection with the transactions contemplated hereby.
NOW, THEREFORE, in consideration of the premises and the mutual
promises contained herein, and intending to be legally bound, the parties hereby
agree as follows:
ARTICLE I
DEFINITIONS
-----------
1.1 Definitions. (a) Capitalized terms used and not defined in this
-----------
Agreement shall have the following meanings:
"Advertising Agreement" means the advertising agreement between Xenon
---------------------
2 and NBC to be dated as of the Closing Date having the terms set forth in
Exhibit A hereto.
---------
"Affiliate" means with respect to a specified Person, any Person that
---------
directly or indirectly, through one or more intermediaries, controls, is
controlled by, or is under common control with, the specified Person. As used
in this definition, the term "control" means the possession, directly or
indirectly, of the power to direct or cause the direction of the management and
policies of a Person, whether through ownership of voting securities, as trustee
or executor, by contract or credit arrangement or otherwise.
"Business Day" means a day, other than Saturday or Sunday, on which
------------
commercial banks in New York City are open for the general transaction of
business.
"Class A Common Stock" means the Class A common stock, $0.0001 par
--------------------
value per share, of Xenon 2.
"Class B Common Stock" means the Class B common stock, $0.0001 par
--------------------
value per share, of Xenon 2.
<PAGE>
3
"CNBC.com" means the entity to be formed by NBC or its Subsidiaries
--------
pursuant to Section 6.10 to conduct business through the CNBC.com universal
------------
resource locator.
"CNET Standstill Agreement" means a Standstill Agreement between Xenon
-------------------------
2 and CNET to be dated as of the Closing Date substantially in the form of
Exhibit B hereto.
---------
"CNET Voting Agreement" means a Voting and Right of First Offer
---------------------
Agreement between CNET and NBC to be dated as of the Closing Date substantially
in the form of Exhibit C hereto.
---------
"Code" means the Internal Revenue Code of 1986, as amended.
----
"Contributed Assets" means the Xoom Stock, the interests in SNAP and
------------------
the NBC Multimedia Assets.
"Environmental Laws" means any and all laws, rules, orders,
------------------
regulations, statutes, ordinances, guidelines, codes, decrees, or other legally
enforceable requirement (including, without limitation, common law) of any
foreign government, the United States, or any state, local, municipal or other
governmental authority, regulating, relating to or imposing liability or
standards of conduct concerning protection of the environment or of human
health, or employee health and safety.
"ERISA" means the Employee Retirement Income Security Act of 1974, as
-----
amended.
"Exchange Act" means the Securities Exchange Act of 1934, as amended.
------------
"Final Determination" means a determination as defined in Section
-------------------
1313(a) of the Code or any other event which finally and conclusively
establishes the amount of any liability for Taxes.
"Flying Disc" means Flying Disc Investments Limited Partnership, a
-----------
Nevada limited partnership.
"GAAP" means generally accepted accounting principles in the United
----
States.
"Governance Agreement" means the governance agreement between Xenon 2
--------------------
and NBC to be dated as of the Closing Date substantially in the form set forth
in Exhibit D hereto.
---------
"Governmental Authority" means any nation or government, any state or
----------------------
other political subdivision thereof, and any entity exercising executive,
legislative, judicial, regulatory or administrative functions of or pertaining
to government.
"HSR Act" means the Hart-Scott-Rodino Antitrust Improvements Act of
-------
1976, as amended.
<PAGE>
4
"Implementing Agreements" means, the NBC Note, the Xenon 2 Convertible
-----------------------
Note, the Governance Agreement, the Registration Rights Agreement, the License
Agreement, the Advertising Agreement, the CNET Voting Agreement and the CNET
Standstill Agreement.
"Independent Accountants" means a nationally recognized firm of
-----------------------
independent certified public accountants selected and retained by the mutual
agreement of NBC and Xenon 2.
"Intellectual Property" shall mean any patents, patent registrations,
---------------------
patent applications, trademarks, trademark registrations, trademark
applications, tradenames, copyrights, copyright applications, copyright
registrations, franchises, universal resource locators, domain names, permits,
licenses, processes, formulae, proprietary technology, inventions, trade
secrets, know-how, product descriptions and specifications.
"Knowledge of" or "best Knowledge of" a party hereto when modifying
------------ -----------------
any representation and warranty shall mean that such party has no actual
knowledge that such representation and warranty is not true and correct to the
extent provided therein and that (i) such party has made appropriate
investigations and inquiries of its officers and responsible employees and (ii)
nothing has come to its attention in the course of such investigation and
inquiries which would cause such party, in the exercise of due care, to believe
that such representation and warranty is not true and correct to the extent
provided therein; provided that each of the parties hereto shall be deemed to
--------
have satisfied the foregoing requirements by making appropriate investigations
and inquiries of its officers and employees listed on Schedule 1.1(a), and no
---------------
knowledge of any other director, officer or employee of such party shall be
imputed to the persons listed on the Schedule or to such party.
"Liability" means, as to any Person, all debts, liabilities and
---------
obligations, direct, indirect, absolute or contingent of such Person, whether
accrued, vested or otherwise, whether known or unknown and whether or not
actually reflected, or required to be reflected, in such Person's balance
sheets.
"License Agreement" means the license agreement between NBC Multimedia
-----------------
and NBC to be dated as of the date hereof substantially in the form set forth in
Exhibit E hereto.
---------
"Lien" means any mortgage, pledge, security interest, encumbrance,
----
lien or charge of any kind.
"Losses and Expenses" means any and all damages, claims, losses,
-------------------
expenses, costs, obligations and Liabilities, including, without limiting the
generality of the foregoing, Liabilities for all reasonable attorneys' fees and
expenses (including attorney and expert fees and expenses incurred to enforce
the terms of this Agreement), provided, however, that "Losses and Expenses"
-------- -------
shall not include any lost profits or other incidental, consequential or
punitive damages.
"Material Adverse Effect" means, for any party, a material adverse
-----------------------
effect on (i) the assets, liabilities, business, results of operations or
financial condition of (A) Xoom, Xenon 2
<PAGE>
5
and their respective Subsidiaries, taken as a whole, in the case of Xoom or (B)
the NBC Multimedia Businesses and SNAP, taken as a whole, in the case of NBC; or
(ii) the ability of such party to perform its obligations hereunder, under the
Voting Agreement, the Option Agreement or under the Implementing Agreements to
which it is a party. Notwithstanding the foregoing, the occurrence of one of the
following events, without the occurrence of any other events, shall not be
deemed by itself to constitute a Material Adverse Effect: (i) a change in the
market price or trading volume of the outstanding equity securities of a party
that is publicly traded, (ii) the failure of a party to meet earnings estimates
of equity analysts as reflected in the First Call consensus estimates for any
period (or for which earnings are released) on or after the date of this
Agreement and prior to the Effective Time or (iii) adverse conditions affecting
the U.S. economy as a whole or affecting the multi-media industry (including
internet-related businesses) as a whole (provided that in each case such changes
--------
do not affect such party in a disproportionate manner).
"Materials of Environmental Concern" means any gasoline or petroleum
----------------------------------
(including, without limitation, crude oil or any fraction thereof) or petroleum
products, polychlorinated biphenyls, urea-formaldehyde insulation, asbestos,
pollutants, contaminants, radioactivity, and any other substances of any kind,
whether or not any such substance is defined as hazardous or toxic under any
Environmental Law, that is regulated pursuant to or could give rise to liability
under any Environmental Law.
"Member of the Controlled Group" means each trade or business, whether
------------------------------
or not incorporated, which would be treated as a single employer with the named
trade or business under Section 4001 of ERISA or Section 414(b), (c), (m) or (o)
of the Code.
"Nasdaq" means the Nasdaq National Market.
------
"NBC.com" means the NBC.com universal resource locator and the
-------
business conducted through it.
"NBC-IN" means the NBC-IN.com universal resource locator and the
------
business conducted through it.
"NBC Multimedia Assets" means the assets, properties and other rights
---------------------
of NBC and NBC Multimedia listed on Schedule 1.1(b) which are to be contributed
---------------
to NMC on the Closing Date.
"NBC Multimedia Businesses" means, collectively, NBC.com, Videoseeker
-------------------------
and NBC-IN.
"NBC Multimedia Liabilities" means the liabilities of NBC Multimedia
--------------------------
listed on Schedule 1.1(c) which are to be assumed by NMC on the Closing Date.
---------------
"NBC Note" means the $340,000,000 note issued by NBC to GE Investments
--------
Sub to be transferred to Xenon 2 on the Closing Date.
<PAGE>
6
"Option Agreement" means the Stock Option Agreement, dated as of the
----------------
date hereof, between NBC and Xoom.
"Other Property or Money" means other property or money within the
-----------------------
meaning of Section 351(b) of the Code.
"Permitted Liens" means (i) Liens for Taxes that (x) are not yet due
---------------
or delinquent or (y) are being contested in good faith by appropriate
proceedings and for which adequate reserves have been established in accordance
with GAAP; (ii) statutory Liens or landlords', carriers', warehousemen's,
mechanics', suppliers', materialmen's, repairmen's or other like Liens arising
in the ordinary course of business with respect to amounts not yet overdue for a
period of 45 days or amounts being contested in good faith by appropriate
proceedings if a reserve or other appropriate provision, if any, as shall be
required by GAAP shall have been made therefor; (iii) Liens incurred or deposits
made in connection with workers' compensation, unemployment insurance and other
types of social security or similar benefits; (iv) Liens incurred or deposits
made to secure the performance of tenders, bids, leases, statutory obligations,
surety and appeal bonds, government contracts, performance and return-of-money
bonds and other obligations of like nature; (v) easements, rights-of-way,
restrictions and other similar charges or encumbrances on real property
interests which, individually or in the aggregate, do not materially interfere
with the ordinary conduct of the relevant entity or business, taken as a whole
or the use of any such real property for its current uses; (vi) leases or
subleases granted to others which do not materially interfere with the ordinary
conduct of the relevant entity or business, taken as a whole; (vii) with respect
to real property, title defects or irregularities that do not in the aggregate
materially impair the use of the property; (viii) any other Liens imposed by
operation of law that do not, individually or in the aggregate, have a Material
Adverse Effect on the relevant entity or business, taken as a whole; and (ix) as
to any real property leases with respect to which the relevant entity is a
lessee, any Lien affecting the interest of the landlord thereunder.
"Person" means any individual, corporation, partnership, joint
------
venture, trust, incorporated organization, limited liability company, other form
of business or legal entity or Governmental Authority.
"Post-Closing Tax Period" means any Tax period (or portion thereof)
-----------------------
ending after the Closing Date.
"Pre-Closing Tax Period" means any Tax period (or portion thereof)
----------------------
ending on or before the Closing Date.
"Registration Rights Agreement" means the registration rights
-----------------------------
agreement among Xenon 2, NBC, CNET and Flying Disc to be dated as of the Closing
Date having the terms set forth in Exhibit F hereto.
---------
"SEC" means the Securities and Exchange Commission.
---
"Securities Act" means the Securities Act of 1933, as amended.
--------------
<PAGE>
7
"SNAP" means SNAP! LLC, a Delaware limited liability company.
----
"SNAP LLC Agreement" means the limited liability agreement of SNAP, as
------------------
amended from time to time.
"SNAP Units" means the units representing limited liability company
----------
interests under the SNAP LLC Agreement.
"Subsidiary" or "Subsidiaries" of any Person means any corporation,
---------- ------------
partnership, limited liability company, joint venture or other legal entity of
which such Person (either alone or through or together with any other
subsidiary) owns, directly or indirectly, more than 50% of the stock or other
equity interests, the holders of which are generally entitled to vote for the
election of the board of directors or other governing body of such corporation
or other legal entity and any partnership of which such Person serves as general
partner.
"Tax Authority" shall mean any Governmental Authority having
-------------
jurisdiction over Taxes.
"Taxes" shall mean all federal, state, local and foreign taxes, fees,
-----
charges and other assessments of a similar nature, whether imposed directly or
through withholding, including, without limitation, any net income, gross
income, gross receipts, sales, use, ad valorem, value added, transfer,
franchise, profits, license, payroll, employment, excise, severance, stamp,
capital stock, occupation, property, environmental or windfall tax, premium,
custom, duty or other tax, together with any interest, additions to tax, or
penalties applicable thereto.
"Tax Returns" shall mean all federal, state, local and foreign tax
-----------
returns, declarations, statements, reports, schedules, forms and information
returns and any amended tax returns relating to Taxes.
"Videoseeker" means the Videoseeker.com universal resource locator and
-----------
the business conducted through it.
"Voting Agreement" means the Voting Agreement, dated as of the date
----------------
hereof, among Xoom, NBC, CNET, Chris Kitze and Flying Disc.
"Xoom Preferred Stock" means shares of preferred stock, par value
--------------------
$.0001 per share, of Xoom.
"Xoom Stock" means shares of common stock, par value $.0001 per share,
----------
of Xoom.
"Xenon 2 Convertible Note" means the $486,894,758 Zero Coupon
------------------------
Convertible Debenture due 2006 issued by Xenon 2 to GE Investments Sub on the
Closing Date having the terms set forth in Exhibit G hereto.
---------
<PAGE>
8
"Xenon 2 Merger Agreement" means the Agreement and Plan of
------------------------
Contribution and Merger, dated as of the date hereof, among Xoom, Xenon 2, Xenon
3, SNAP and CNET.
Term Section
---- -------
Certificate of Merger 3.3
Claim Notice 8.3
Class A Common Stock 1.1
Class B Common Stock 1.1
Closing 3.2
Closing Date 3.2
Effective Time 3.3
Financial Information 4.1(e)
Form S-4 6.1
Indemnified Party 6.6(d)
Intellectual Property 1.1
Material Transaction Proposal 5.5(c)
Merger 3.1
Merger Consideration 3.8
NBC Multimedia Business Intellectual Property 4.1(k)
NBC Plans 6.7(b)(i)
Nominees 6.6
Non-Plan Option 6.8
Notice Period 8.3
Option Plan 6.8
Proxy Statement 6.1
Required Consents 6.4
SEC Documents 4.3(h)(i)
SNAP Balance Sheet 4.2(f)
SNAP Budget 4.2(i)
SNAP Intellectual Property 4.2(l)
SNAP Plans 4.2(p)
Stockholder Approvals 5.5
Stockholder Meeting 6.2
Surviving Corporation 3.1
Takeover Proposal 5.5(c)
Vacation Policy 6.7(b)(v)
Xoom Budget 4.3(k)
Xoom ESPP 4.3(g)
Xoom Intellectual Property 4.3(n)
Xoom Options 6.8
<PAGE>
9
ARTICLE II
CONTRIBUTIONS AND ISSUANCES
---------------------------
2.1 Contributions to NBC Multimedia. (a) Subject to the satisfaction or
-------------------------------
waiver of the conditions set forth in this Agreement, at the Closing and
immediately prior to the Effective Time (as defined in Section 3.3), NBC shall
-----------
contribute to NBC Multimedia, and NBC Multimedia shall accept, a 10% equity
interest in CNBC.com, which interest shall be subject to the rights and
obligations set forth on Schedule 2.1.
------------
(b) In connection with the transactions described in Section 2.1(a),
--------------
NBC shall execute, and shall cause NBC Multimedia to execute all contribution,
transfer, assumption and other agreements which are reasonably necessary to
effect the transactions described therein. The CNBC.com interest shall be
transferred free and clear of all Liens, except those set forth on Schedule
2.1(a).
2.2 Contributions to NMC; Issuances of NMC Capital Stock. (a) Subject to
----------------------------------------------------
the satisfaction or waiver of the conditions set forth in this Agreement, at the
Closing and immediately prior to the Effective Time, NBC shall, or shall cause
NBC Multimedia, to assign and contribute to NMC, and NMC shall accept, all of
NBC's and NBC Multimedia's right, title and interest in the NBC Multimedia
Assets, and NBC and NBC Multimedia shall assign and contribute to NMC, and NMC
shall assume, all of the NBC Multimedia Liabilities.
(b) In connection with the transactions described in Section 2.2(a),
--------------
NBC, NBC Multimedia, and NMC shall execute all contribution, transfer,
assumption and other agreements which counsel for NBC and Xoom determine are
reasonably necessary to effect the transactions described therein. All of the
assets transferred pursuant to Section 2.2(a) shall be transferred free and
--------------
clear of all Liens (other than any Liens imposed by or on behalf of Xenon 2).
(c) In exchange for the assignments and contributions set forth in
Section 2.2(a), at the Closing and concurrently therewith, NMC shall issue
--------------
13,764,726 shares of its common stock, par value $.0001 per share, which until
the Effective Time shall represent all of the outstanding capital stock of NMC,
to NBC Multimedia.
2.3 Contributions To Xenon 2; Issuances of Xenon 2 Capital Stock. (a)
------------------------------------------------------------
Subject to the satisfaction or waiver of the conditions set forth in this
Agreement, at the Closing and immediately after the Effective Time, NBC shall
cause NBC Multimedia to transfer to Xenon 2, and Xenon 2 shall accept, all of
the right, title and interest to the SNAP Units held by NBC Multimedia,
including NBC Multimedia's rights pursuant to Section 7.3 and Section 7.4 of the
----------- -----------
SNAP LLC Agreement to increase the number of SNAP Units held by NBC Multimedia
as provided in such agreement.
<PAGE>
10
(b) In connection with the transactions described in Section 2.3(a),
--------------
NBC, NBC Multimedia and Xenon 2 shall execute all contribution, transfer,
assumption and other agreements which counsel for NBC and Xoom determine are
reasonably necessary to effect the transactions described therein. All of the
assets transferred pursuant to Section 2.3(a) shall be transferred free and
--------------
clear of all Liens (other than any Liens imposed by or on behalf of Xenon 2).
(c) In exchange for the assignment and contribution of the SNAP Units
set forth in Section 2.3(a), at the Closing and concurrently therewith, Xenon 2
--------------
shall issue 11,417,569 shares of Class B Common Stock to NBC Multimedia;
provided, that in no event shall NBC and its Affiliates be issued shares of
--------
Common Stock of Xenon 2 that would result in their aggregate holding of such
shares being equal to or greater than 50% of the outstanding shares of Common
Stock of Xenon 2 after giving effect to all of the issuances of such Common
Stock on the Closing Date.
(d) Upon the original issuance of the shares of Class B Common Stock
by Xenon 2 to NBC Multimedia pursuant to Section 2.2 and Section 2.3(c), and
----------- --------------
until such time as the same is no longer required hereunder or under the
applicable requirements of the Securities Act or applicable state securities
laws, any certificate issued representing any such Class B Common Stock shall
bear the following legend:
"THE SHARES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN REGISTERED UNDER
THE SECURITIES ACT OF 1933, AS AMENDED, OR THE SECURITIES LAWS OF ANY STATE
AND MAY NOT BE SOLD, TRANSFERRED OR OTHERWISE DISPOSED OF UNLESS (A) THEY
ARE SO REGISTERED OR (B) AN EXEMPTION FROM REGISTRATION IS AVAILABLE AND
THE ISSUER IS FURNISHED WITH AN OPINION OF COUNSEL REASONABLY SATISFACTORY
TO THE ISSUER TO THAT EFFECT. IN ADDITION, SUCH SHARES MAY ONLY BE
TRANSFERRED PURSUANT TO THE PROVISIONS OF A GOVERNANCE AND INVESTOR RIGHTS
AGREEMENT, DATED AS OF ______, 1999, AS AMENDED FROM TIME TO TIME, AMONG
NATIONAL BROADCASTING COMPANY, INC. AND THE ISSUER COPIES OF WHICH ARE ON
FILE AT THE PRINCIPAL OFFICE OF THE ISSUER."
2.4 Note Issuances. (a) Subject to the satisfaction or waiver of the
--------------
conditions set forth in this Agreement, after the Effective Time and the
consummation of all of the transactions contemplated by Section 2.1, Section 2.2
----------- -----------
and Section 2.3 of this Agreement, GE Investments Sub shall purchase the Xenon 2
-----------
Convertible Note from Xenon 2 in exchange for $30 million and an assignment of
the NBC Note from GE Investments Sub to Xenon 2.
(b) In connection with the transactions described in Section 2.4(a),
--------------
NBC, GE Investments Sub and Xenon 2 shall execute all purchase, transfer and
other agreements which counsel for NBC and Xoom determine are reasonably
necessary to effect the transactions described therein. Upon surrender of the
NBC Note to NBC, NBC shall issue a new note payable to Xenon 2 having the terms
set forth in Exhibit H.
---------
<PAGE>
11
2.5 Required Consents. Notwithstanding anything to the contrary contained
-----------------
in this Agreement, to the extent that the sale, conveyance, transfer, assignment
or delivery or attempted sale, conveyance, transfer, assignment or delivery to
NMC or Xenon 2 of any of the assets (including any assumed contract, license or
other agreement) is prohibited by applicable law or would require any
governmental or third-party authorization, approval, consent or waiver and such
authorization, approval, consent or waiver shall not have been obtained prior to
the Closing, this Agreement shall not constitute a sale, conveyance, transfer,
assignment or delivery, or an attempted sale, conveyance, transfer, assignment
or delivery thereof if any of the foregoing would constitute a breach of
applicable law or the rights of any third party. Following the Closing, the
parties shall use their reasonable commercial efforts, and shall cooperate with
each other, to obtain promptly such authorizations, approvals, consents or
waivers; provided, however, that neither NBC, Xenon 2 nor any of their
-------- -------
respective Affiliates shall be required to pay any consideration therefor, other
than filing, recordation or similar fees payable to any governmental authority,
which fees shall be paid by Xenon 2. Pending or in the absence of such
authorization, approval, consent or waiver, the parties shall use their
reasonable commercial efforts to enter into reasonable and lawful arrangements
designed to provide to Xenon 2 the benefits and liabilities of use of such
assets from and after the Effective Time.
2.6 Tax Refunds. Notwithstanding anything herein to the contrary, Xenon 2
-----------
shall be entitled to all refunds of Taxes with respect to the activities,
properties or employees of NMC or SNAP attributable to the period after the
Closing Date.
ARTICLE III
THE MERGER
3.1 The Merger. Upon the terms and subject to the conditions set forth in
----------
this Agreement, and in accordance with the Delaware General Corporation Law (the
"DGCL"), NMC shall be merged (the "Merger") with and into Xenon 2 at the
---- ------
Effective Time. Following the Merger, the separate corporate existence of NMC
shall cease and Xenon 2 shall continue as the surviving corporation (the
"Surviving Corporation").
----------------------
3.2 Closing. Subject to the satisfaction or waiver (subject to applicable
-------
law) of the conditions set forth in Article VII, the closing of the Merger and
-----------
the transactions contemplated by this Agreement (the "Closing") will take place
-------
on the second Business Day after all the conditions to Closing (other than
conditions that, by their terms, cannot be satisfied until the Closing Date) set
forth in Article VII shall have been satisfied or waived, unless this Agreement
-----------
has been theretofore terminated pursuant to its terms, unless another time or
date is agreed to in writing by the parties hereto (the actual time and date of
the Closing being referred to herein as the "Closing Date"). The Closing shall
------------
be held at the offices of Simpson Thacher & Bartlett, 425 Lexington Avenue, New
York, New York, 10017, unless another place is agreed to in writing by the
parties hereto.
<PAGE>
12
3.3 Effective Time. As soon as practicable following the satisfaction of
--------------
the conditions set forth in Article VII, the parties shall (i) file a
-----------
certificate of merger (the "Certificate of Merger") executed in accordance with
---------------------
the relevant provisions of the DGCL and (ii) make all other filings or
recordings required under the DGCL. The Merger shall become effective at such
time as shall be specified in the Certificate of Merger (the date and time the
Merger becomes effective being the "Effective Time").
--------------
3.4 Effects of the Merger. At and after the Effective Time, the Merger
---------------------
will have the effects set forth in the DGCL. Without limiting the generality of
the foregoing, and subject thereto, at the Effective Time all the property,
rights, privileges, powers and franchises of NMC and Xenon 2 shall be vested in
the Surviving Corporation, and all debts, liabilities and duties of NMC and
Xenon 2 shall become the debts, liabilities and duties of the Surviving
Corporation.
3.5 Certificates of Incorporation. Xoom shall cause the certificate of
-----------------------------
incorporation of Xenon 2 to be amended and restated immediately prior to the
Effective Time to change the name of Xenon 2 to "NBC Internet, Inc." and so as
to otherwise read in its entirety as set forth in Exhibit 3.5, with such changes
-----------
therein as NBC and Xenon 2 may agree upon prior to the Effective Time, and such
amended and restated certificate of incorporation shall be the certificate of
incorporation of the Surviving Corporation until thereafter changed or amended
as provided therein or by applicable law.
3.6 By-Laws. Xoom shall cause the by-laws of Xenon 2 to be amended and
-------
restated effective prior to the Effective Time so as to read in their entirety
as set forth in Exhibit 3.6, with such changes therein as NBC and Xenon 2 may
-----------
agree upon prior to the Effective Time, and such amended and restated by-laws
shall be the by-laws of the Surviving Corporation until thereafter changed or
amended as provided therein or by applicable law.
3.7 Officers and Directors of Surviving Corporation and Xenon 2. The
-----------------------------------------------------------
officers and directors of the Surviving Corporation shall be as provided in
Schedule 3.7, which individuals will serve as officers and directors of the
------------
Surviving Corporation until the earlier of their resignation or removal or
otherwise ceasing to be an officer or director or until their respective
successors are duly elected and qualified.
3.8 Effect on Capital Stock. (a) At the Effective Time by virtue of the
-----------------------
Merger and without any action on the part of the holder thereof, each share of
common stock, par value $0.0001, of NMC (the "NMC Common Stock") issued and
----------------
outstanding immediately prior to the Effective Time (other than shares of NMC
Common Stock held by NMC, all of which shall be canceled as provided in Section
-------
3.8(c)) shall be converted into one share of Class B common stock, par value
------
$0.0001 per share, of the Surviving Corporation (the "Merger Consideration") and
--------------------
all shares of common stock of the Surviving Corporation issued and outstanding
at the Effective Time shall remain outstanding after the Merger.
(b) As a result of the Merger and without any action on the part of
the holders thereof, at the Effective Time, all shares of NMC Common Stock shall
be canceled and shall
<PAGE>
13
cease to exist, and each holder of a certificate which immediately prior to the
Effective Time represented any such shares of NMC Common Stock (a "Certificate")
-----------
shall thereafter cease to have any rights with respect to such shares of NMC
Common Stock, except as provided herein or by law.
(c) Each share of NMC Common Stock held by NMC at the Effective Time
shall, by virtue of the Merger, cease to be outstanding and shall be canceled
and no stock of Xenon 2 or other consideration shall be delivered in exchange
therefor.
(d) Upon the original issuance of the shares of Class B Common Stock
by Xenon 2 in connection with the Merger, and until such time as the same is no
longer required hereunder or under the applicable requirements of the Securities
Act or applicable state securities laws, any certificate issued representing any
such Class B Common Stock shall bear the following legend:
"THE SHARES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN REGISTERED UNDER
THE SECURITIES ACT OF 1933, AS AMENDED, OR THE SECURITIES LAWS OF ANY STATE
AND MAY NOT BE SOLD, TRANSFERRED OR OTHERWISE DISPOSED OF UNLESS (A) THEY
ARE SO REGISTERED OR (B) AN EXEMPTION FROM REGISTRATION IS AVAILABLE AND
THE ISSUER IS FURNISHED WITH AN OPINION OF COUNSEL REASONABLY SATISFACTORY
TO THE ISSUER TO THAT EFFECT. IN ADDITION, SUCH SHARES MAY ONLY BE
TRANSFERRED PURSUANT TO THE PROVISIONS OF A GOVERNANCE AND INVESTOR RIGHTS
AGREEMENT, DATED AS OF ________, 1999, AS AMENDED FROM TIME TO TIME AMONG
NATIONAL BROADCASTING COMPANY, INC. AND THE ISSUER COPIES OF WHICH ARE ON
FILE AT THE PRINCIPAL OFFICE OF THE ISSUER."
3.9 Exchange Procedures. As soon as reasonably practicable after the
-------------------
Effective Time, NBC shall cause NBC Multimedia to deliver its Certificate to
Xenon 2 and NBC Multimedia shall be entitled to receive in exchange a
certificate representing, in the aggregate, the number of shares into which the
NMC Common Stock was converted pursuant to Section 3.8(a).
--------------
3.10 No Further Ownership Rights in NMC Common Stock. All shares of Class
-----------------------------------------------
B Common Stock issued upon conversion of NMC Common Stock in accordance with the
terms of this Article III shall be deemed to have been issued in full
-----------
satisfaction of all rights pertaining to the shares of NMC Common Stock formerly
represented thereby.
3.11 Further Assurances. At and after the Effective Time, the officers and
------------------
directors of the Surviving Corporation will be authorized to execute and
deliver, in the name and on behalf of NMC or Xenon 2, any deeds, bills of sale,
assignments or assurances and to take and do, in the name and on behalf of NMC
or Xenon 2, any other actions and things to vest, perfect or confirm of record
or otherwise in the Surviving Corporation any and all right, title and interest
in, to and
<PAGE>
14
under any of the rights, properties or assets acquired or to be acquired by the
Surviving Corporation as a result of, or in connection with, the Merger.
3.12 Federal Income Tax Consequences. For federal income tax purposes, it
-------------------------------
is intended that the transfers described in Section 2.1, Section 2.2 and Section
----------- ----------- -------
2.3 and the Merger qualify as a contribution to Xenon 2 qualifying under Section
---
351 of the Code.
ARTICLE IV
REPRESENTATIONS AND WARRANTIES OF THE PARTIES
---------------------------------------------
4.1 Representations and Warranties of NBC. NBC represents and warrants to
-------------------------------------
Xoom and Xenon 2 as follows, provided that none of the representations or
--------
warranties contained in this Section 4.1 are made with respect to SNAP, its
-----------
assets, Liabilities or the business conducted thereby except paragraphs (a), (b)
and (c) and the second sentence of paragraph (g) to the extent related to the
ownership or transfer of the SNAP Units:
(a) Due Organization, Power and Good Standing. NBC, NMC and each of
-----------------------------------------
Neon's Subsidiaries that is a party to an Implementing Agreement is duly
organized, validly existing and in good standing under the laws of its
jurisdiction of organization, and has the requisite power and authority to own,
lease and operate its properties and to conduct its business as now conducted by
it. NBC, NMC and each of Neon's Subsidiaries that is a party to an Implementing
Agreement has all requisite power and authority to enter into this Agreement and
the Implementing Agreements to which it is a party and to perform its
obligations hereunder and thereunder. NBC, NMC and each of Neon's Subsidiaries
that is a party to an Implementing Agreement is qualified to do business and is
in good standing in all jurisdictions in which it conducts its business, except
where the failure to do so would not, individually or in the aggregate, taken as
a whole, have a Material Adverse Effect.
(b) Authorization and Validity of Agreements. The execution, delivery
----------------------------------------
and performance by NBC and its Subsidiaries of this Agreement and of the
Implementing Agreements to which it or its Subsidiaries is a party and the
consummation by NBC and its Subsidiaries of the transactions contemplated hereby
and thereby have been duly authorized by all necessary corporate or other
governance action (including any required approval from NBC Parent) on the part
of NBC and its Subsidiaries. Each of this Agreement, the Option Agreement and
the Voting Agreement has been, and each of the Implementing Agreements to which
NBC or any of its Subsidiaries is a party will on the Closing Date be, duly
executed and delivered by NBC and its Subsidiaries and constitutes or, in the
case of the Implementing Agreements, upon execution thereof will constitute, a
valid and legally binding obligation of NBC and its Subsidiaries, enforceable
against each in accordance with its terms.
(c) Governmental Approvals; Consents. Except as described in Schedule
-------------------------------- --------
4.1(c), the execution, delivery and performance of this Agreement, the Option
------
Agreement and the Implementing Agreements by NBC and its Subsidiaries and the
consummation by such Persons
<PAGE>
15
of the transactions contemplated hereby and thereby will not (i) conflict with
or result in a breach of any provision of the certificate of incorporation or
bylaws or other governing documents of NBC or its Subsidiaries; (ii) require any
consent, approval, authorization or permit of, or filing with or notification
to, any Governmental Authority; (iii) require the consent or approval of any
Person (other than a Governmental Authority or any approvals required under
Section 4.1(b)) or violate or conflict with, or result in a breach of any
--------------
provision of, constitute a default (or an event which with notice or lapse of
time or both would become a default) or give to any third party any right of
termination, cancellation, amendment or acceleration under, or result in the
creation of a Lien on any of the NBC Multimedia Assets under, any of the terms,
conditions or provisions of any contract or license to which NBC or any of its
Subsidiaries is a party or by which it or its assets or property are bound; or
(iv) violate or conflict with any order, writ, injunction, decree, statute, rule
or regulation applicable to NBC or any of its Subsidiaries; other than any
consents, approvals, authorizations and permits the failure of which to obtain
and any violations, conflicts, breaches defaults and other matters set forth
pursuant to clauses (ii), (iii) and (iv) above which, individually or in the
aggregate, would not reasonably be expected to have a Material Adverse Effect.
(d) Certain Fees. Neither NBC or any of its Subsidiaries nor the
------------
officers, directors or employees, thereof have employed any broker or finder or
incurred any other Liability for any brokerage fees, commissions or finders'
fees in connection with the transactions contemplated hereby; except that NBC
has employed BT Alex. Brown Incorporated whose fees and expenses will be paid in
accordance with Section 10.5 if the transactions contemplated by this Agreement
------------
are consummated and will otherwise be paid by NBC.
(e) Financial Information, Liabilities. NBC has provided Xenon 2 with
----------------------------------
certain historical financial information relating to the NBC Multimedia
Businesses set forth on Schedule 4.1(e) hereto (the "Financial Information").
--------------- ---------------------
The Financial Information has been prepared in accordance with the accounting
principles and procedures set forth on Schedule 4.1(e) and is true and correct
---------------
in all material respects. All of the NBC Multimedia Liabilities primarily
relate to the NBC Multimedia Businesses.
(f) Absence of Certain Changes or Events. Except as disclosed on
------------------------------------
Schedule 4.1(f), since December 31, 1998, NBC and its Subsidiaries have
---------------
conducted the NBC Multimedia Businesses in all material respects only in the
ordinary course, consistent with past practice and there has not been (i) any
material adverse change in the assets, liabilities, business, results of
operations or financial condition of the NBC Multimedia Businesses or (ii)
except in the ordinary course of business consistent with past practice and
except for such matters that would not reasonably be expected to have a Material
Adverse Effect, any damage, destruction, loss, conversion, condemnation or
taking by eminent domain related to any material NBC Multimedia Asset. In
addition, except as disclosed on Schedule 4.1(f), from December 31, 1998 to the
---------------
date hereof, neither NBC nor any of its Subsidiaries has (A) acquired or
disposed of any material assets of an NBC Multimedia Business or entered into
any agreement or other arrangement for any such acquisition or disposition or
(B) relinquished, forgiven or canceled any material debts or claims with respect
to an NBC Multimedia Business.
<PAGE>
16
(g) Title to Properties; Absence of Liens. NBC or its Subsidiaries
-------------------------------------
have, and at the Closing, NMC will acquire, good title to (or, in the case of
real estate or equipment leases, a valid lease to) all properties, assets and
other rights included in the NBC Multimedia Assets, free and clear of all Liens
except for Permitted Liens and Liens described on Schedule 2.1. NBC or its
Subsidiaries have, and at the Closing, Xenon 2 will acquire, good title to all
of the SNAP Units held by NBC and its Subsidiaries, free and clear of all Liens
(other than Liens created, imposed or granted by Xenon 2 and as set forth in the
SNAP LLC Agreement). Assuming the consummation of the transactions contemplated
by the Xenon 2 Merger Agreement in accordance with the terms and conditions
thereof, at the Closing, Xenon 2 will acquire good title to all of the SNAP
Units.
(h) Properties, Contracts, Permits and Other Data. Except as
---------------------------------------------
specified in Schedule 4.1(h) hereto, all rights, licenses, leases,
---------------
registrations, applications, contracts, commitments and other agreements of NBC
and its Subsidiaries with respect to the NBC Multimedia Businesses or by which
the NBC Multimedia Assets are bound are in full force and effect and are valid
and enforceable in accordance with their respective terms except for such
failures to be in full force and effect and valid and enforceable that would
not, individually or in the aggregate, have a Material Adverse Effect. No NBC
Multimedia Business is in breach or default in the performance of any obligation
thereunder and no event has occurred or has failed to occur whereby any of the
other parties thereto have been or will be released therefrom or will be
entitled to refuse to perform thereunder, the enforcement of which would have,
either individually or in the aggregate, a Material Adverse Effect.
(i) Legal Proceedings. Except as described in Schedule 4.1(i), there
----------------- ---------------
is no litigation, proceeding or governmental investigation to which NBC or its
Subsidiaries is a party pending or, to the best Knowledge of NBC, threatened
against it or its Subsidiaries which, either individually or in the aggregate,
would reasonably be expected to result in a Material Adverse Effect or which, as
of May 9, 1999, seeks to restrain or enjoin the consummation of any of the
transactions contemplated hereby. NBC and its Subsidiaries are not party to,
nor are the NBC Multimedia Assets subject to, any judgment, writ, decree,
injunction or order entered by any court or governmental authority (domestic or
foreign) that, individually or in the aggregate, would reasonably be expected to
have a Material Adverse Effect.
(j) Labor Controversies. Except as set forth on Schedule 4.1(j), (i)
------------------- ---------------
there have been no labor strikes, slow-downs, work stoppages, lock-outs or other
material labor controversies or disputes during the past two years, nor is any
such strike, slow-down, work stoppage or other material labor controversy or
dispute pending or, to the best Knowledge of NBC, threatened, in each case with
respect to the current or former employees of the NBC Multimedia Businesses,
(ii) none of the NBC Multimedia Businesses are a party to any labor contract,
collective bargaining agreement, contract, letter of understanding or, to Neon's
Knowledge, any other agreement, formal or informal, with any labor union or
organization, nor are any of the NBC Multimedia Businesses' employees
represented by any labor union or organization, and (iii) no NBC Multimedia
Business has closed any facility, effectuated any layoffs of employees or
implemented any early retirement, separation or window program within
<PAGE>
17
the past two years nor has any NBC Multimedia Business planned or announced any
such action or program for the future.
(k) Intellectual Property. NBC or its Subsidiaries own or are
---------------------
licensed or otherwise have the right to use, all Intellectual Property currently
used in the NBC Multimedia Businesses (the "NBC Multimedia Business Intellectual
------------------------------------
Property"), except as would not, individually or in the aggregate, have a
--------
Material Adverse Effect. No NBC Multimedia Business has infringed upon or is in
conflict with the Intellectual Property of any third party nor has any NBC
Multimedia Business received any written notice of any claim that any NBC
Multimedia Business has infringed upon or is in conflict with any Intellectual
Property of any third party, except as would not, individually or in the
aggregate, have a Material Adverse Effect. Except as set forth on Schedule
--------
4.1(k), none of the rights of NBC or its Subsidiaries to the NBC Multimedia
------
Business Intellectual Property will be impaired in any way by the transactions
provided for herein, and all of the rights of NBC and its Subsidiaries to the
NBC Multimedia Business Intellectual Property will be fully enforceable by NMC
after the Closing Date to the same extent as such rights would have been
enforceable by NBC or its Subsidiaries before the Closing, without the consent
or agreement of any other party other than any consents and agreements the
failure of which to obtain, individually or in the aggregate, would not have a
Material Adverse Effect. There have been no claims (whether private or
governmental) against NBC or its Subsidiaries asserting the invalidity or
unenforceability of its ownership, license or other right to use any of the
registered NBC Multimedia Business Intellectual Property.
(l) Government Licenses, Permits, Etc. Except as set forth on
---------------------------------
Schedule 4.1(l), NBC and its Subsidiaries have all licenses, permits, consents,
---------------
approvals, authorizations, qualifications and orders of Governmental Authorities
required for the conduct of each NBC Multimedia Business as presently conducted,
except where failure would not, individually or in the aggregate, have a
Material Adverse Effect.
(m) Conduct of Business in Compliance with Regulatory and Contractual
-----------------------------------------------------------------
Requirements. NBC and its Subsidiaries have complied with all applicable laws,
------------
ordinances, regulations or orders or other requirements of any Governmental
Authority applicable to the NBC Multimedia Businesses, including, without
limitation, all rules, regulations and administrative orders relating to anti-
competitive practices, discrimination, employment, health and safety, except
where the failure to be in such compliance would not have, either individually
or in the aggregate, a Material Adverse Effect.
(n) Environmental Matters. Except as set forth on Schedule 4.1(n) and
--------------------- ---------------
except for matters that, individually or in the aggregate, would not have a
Material Adverse Effect, (i) NBC and its Subsidiaries comply and have complied
with all Environmental Laws applicable to the NBC Multimedia Businesses, and
possess and comply with and have possessed and complied with all Environmental
Permits for each NBC Multimedia Business; (ii) there are and have been no
Materials of Environmental Concern, or other conditions, at any property owned
or leased by NBC or any of its Subsidiaries and included in the NBC Multimedia
Assets that could give rise to any liability under any Environmental Law or
result in costs arising out of any Environmental Law; (iii) no judicial,
administrative, or arbitral proceeding (including any notice of violation or
<PAGE>
18
alleged violation) under any Environmental Law to which any NBC or any of its
Subsidiaries is, or to the Knowledge of NBC and its Subsidiaries will be, named
as a party is pending or, to the Knowledge of NBC, threatened, with respect to
any NBC Multimedia Business nor is any NBC Multimedia Business the subject of
any investigation in connection with any such proceeding or potential
proceeding; (iv) there are no past, present, or anticipated future events,
conditions, circumstances, practices, plans, or legal requirements that could be
expected to prevent, or materially increase the burden on any NBC Multimedia
Business of complying with applicable Environmental Laws or of obtaining,
renewing, or complying with all Environmental Permits required under such laws;
and (v) NBC has provided to the other parties true and complete copies of all
Environmental Reports relating to the NBC Multimedia Businesses in the
possession or control of NBC and its Subsidiaries.
(o) Employee Benefit Matters. (i) Neither NBC nor any of its
------------------------
Subsidiaries nor any Member of the Controlled Group of which it is a member has
(A) engaged in, or is a successor or parent corporation to an entity that has
engaged in, a transaction described in Sections 4069 or 4212(c) of ERISA or (B)
incurred, or could reasonably be expected to incur, any liability under (I)
Title IV of ERISA arising in connection with the termination of, or a complete
or partial withdrawal from, any plan covered or previously covered by Title IV
of ERISA or (II) Section 4971 of the Code that in either case could become a
liability of Xenon 2 or any Subsidiary after the Closing Date. The assets of
NBC and all of its Subsidiaries are not now, nor will they after the passage of
time be, subject to any lien imposed under Code Section 412(n) by reason of a
failure of any of NBC or any Subsidiary or any Member of the Controlled Group
of which it is a member to make timely installments or other payments required
under Code Section 412. Schedule 6.7(a) sets forth (i) the names and salaries
---------------
of each employee to whom NMC shall offer employment pursuant to Section 6.7 and
-----------
(ii) any employment agreements between such employees and NBC or any of its
Subsidiaries.
(ii) Except as provided on Schedule 4.1(o), no plan exists with
---------------
respect to the Transferred Employees that could result in the payment to them of
any money or other property or accelerate or provide any other rights or
benefits to them as a result of the transaction contemplated by this Agreement,
whether or not such payment would constitute a parachute payment within the
meaning of Code Section 280G.
(p) Absence of Certain Business Practices. No officer, employee or
-------------------------------------
agent of any NBC Multimedia Business, nor any other Person acting on behalf of
any NBC Multimedia Business, has, directly or indirectly, within the past five
years given or agreed to give any gift or similar benefit to any customer,
supplier, governmental employee or other Person or entity who is or may be in a
position to help or hinder any NBC Multimedia Business (or assist such NBC
Multimedia Business in connection with any actual or proposed transaction) which
(x) subjects any party or any of their respective Subsidiaries, to any damage or
penalty in any civil, criminal or governmental litigation or proceeding, (y) if
not given in the past, would have had a Material Adverse Effect or (z) if not
continued in the future, would have a Material Adverse Effect or which might
subject any party or any of their respective Subsidiaries, to suit or penalty in
any private or governmental litigation or proceeding.
<PAGE>
19
(q) Entire Business. Except as set forth in Schedule 4.1(q), the NBC
--------------- ---------------
Multimedia Assets, together with the License Agreement, will enable Xenon 2 to
conduct the NBC Multimedia Businesses after the Effective Time in substantially
the same manner as they are currently being conducted.
(r) Tax Matters. (i) NBC and each of its Subsidiaries have timely
-----------
filed (or have had timely filed on their behalf) or will timely file or cause to
be timely filed, all Tax Returns required by applicable law to be filed by any
of them prior to the Effective Time with respect to the NBC Multimedia
Businesses or the assets, employees or businesses of or to be contributed by NBC
or its Affiliates to CNBC.com. All such Tax Returns are or will be true,
complete and correct in all material respects. There are no outstanding
agreements or waivers extending the statutory period of limitation applicable to
any of such Tax Returns and neither NBC nor any of its Subsidiaries has
requested any extension of time within which to file any material Tax Return
with respect to the NBC Multimedia Businesses or the assets, employees or
businesses of or to be contributed by NBC or its Affiliates to CNBC.com, which
return has not yet been filed. There is no pending claim by any authority of a
jurisdiction where NBC or any of its Subsidiaries has not filed Tax Returns that
NBC or such Subsidiary is or may have been subject to taxation by that
jurisdiction with respect to the NBC Multimedia Businesses or the assets,
employees or businesses of or to be contributed by NBC or its Affiliates to
CNBC.com. All Taxes required to be withheld by NBC or its Affiliates with
respect to the NBC Multimedia Businesses or CNBC.com or their activities,
properties, employees or independent contractors have been withheld and paid
over to the appropriate Tax Authority.
(ii) NBC and each of its Subsidiaries have paid (or have had paid on
their behalf), or where payment is not yet due, have established (or have had
established on their behalf and for their sole benefit and recourse), or will
establish or cause to be established on or before the Effective Time, an
adequate accrual for the payment of, all Taxes due with respect to any period
beginning prior to the Effective Time with respect to the NBC Multimedia
Businesses or the assets, employees or businesses of or to be contributed by NBC
or its Affiliates to CNBC.com. No deficiency or adjustment for any Taxes has
been threatened, proposed, asserted or assessed against NBC or any of its
Subsidiaries with respect to the NBC Multimedia Businesses or the assets,
employees or businesses of or to be contributed by NBC or its Affiliates to
CNBC.com. There are no liens for Taxes upon the assets of NBC or any of its
Subsidiaries, except for liens for current Taxes not yet due, with respect to
the NBC Multimedia Businesses or the assets, employees or businesses of or to be
contributed by NBC or its Affiliates to CNBC.com.
(iii) With respect to the NBC Multimedia Businesses or the assets,
employees or businesses of or to be contributed by NBC or its Affiliates to
CNBC, neither NBC nor any of its Subsidiaries is required to include in income
any adjustment pursuant to Section 481(a) of the Code or any similar applicable
provision by reason of a voluntary change in accounting method initiated by NBC
or any of its Subsidiaries, and neither the Internal Revenue Service nor any
taxing authority has proposed in writing any such adjustment or change in
accounting method. Neither NBC nor any of its Subsidiaries has received a tax
ruling or entered into a closing agreement with any taxing authority that would
have a Material Adverse Effect
<PAGE>
20
upon the NBC Multimedia Businesses or the assets, employees or businesses of or
to be contributed by NBC or its Affiliates to CNBC.
(iv) With respect to the NBC Multimedia Business, neither NBC nor any
of its Subsidiaries has made any payments, is obligated to make any payments, or
is a party to any agreement, in each case, that could obligate it to make any
payments that would not be deductible pursuant to Section 280G of the Code.
(v) None of the NBC Multimedia Businesses or the business of
CNBC.com has a "permanent establishment," as defined in any applicable Tax
treaty or convention of the United States of America, or fixed place of business
in any foreign country. NBC and its Affiliates are in compliance with the terms
and conditions of any applicable tax exemptions, agreements or orders of any
foreign government to which it may be subject or which it may have claimed with
respect to the NBC Multimedia Businesses or the assets, employees or businesses
of or to be contributed by NBC or its Affiliates to CNBC.com, and the
transactions contemplated by this Agreement will not have any adverse effect on
such compliance.
(vi) CNBC.com shall initially be treated as a partnership for
federal income tax purposes.
(s) Accredited Investor. NBC is an "accredited investor" within the
-------------------
meaning of Rule 501 of Regulation D under the Securities Act. NBC (i) is
acquiring the Class B Common Stock for investment for its own account and not
with a view to, or for sale in connection with, any distribution thereof, in
violation of the Securities Act; (ii) has had an opportunity to ask questions of
the officers and directors of, and has had access to information concerning,
Xenon 2 and its Subsidiaries; (iii) has knowledge, sophistication and experience
in business and financial matters and risks of such investment; (iv) is able to
bear the economic risk of such investment; and (v) is able to afford a complete
loss of such investment.
(t) Year 2000 Compliance. With respect to the NBC Multimedia
--------------------
Businesses, NBC has adopted and implemented a commercially reasonable plan to
provide (x) that the change of the year from 1999 to the year 2000 will not have
a Material Adverse Effect and (y) that the impacts of such change on the venders
and customers of the NBC Multimedia Businesses will not have a Material Adverse
Effect. In Neon's reasonable best estimate, no expenditures materially in
excess of currently budgeted items previously disclosed to Xenon 2 will be
required in order to cause the information and business systems of the NBC
Multimedia Businesses to operate properly following the change of the year 1999
to the year 2000. NBC reasonably expects any material issues related to such
change of the year will be resolved in accordance with the timetable set forth
in such plan (and in any event on a timely basis in order to be resolved before
the year 2000). Between the date of this Agreement and the Effective Time, NBC
shall continue to use commercially reasonable efforts to implement such plan.
(u) NMC. The authorized capital stock of NMC consists of 100 shares
---
of common stock, par value $0.0001 per share, of which 100 shares have been
issued and are outstanding and held by NBC Multimedia as of the date hereof.
NMC has not conducted any
<PAGE>
21
activities other than in connection with its organization, the negotiation and
execution of this Agreement and the consummation of the transactions
contemplated hereby. Prior to the Closing Date, NMC's certificate of
incorporation will be amended to provide for an authorized capital stock
sufficient to permit NMC to issue shares of its common stock as described in
Section 2.2(c).
--------------
(v) No Other Liabilities. Other than the NBC Multimedia Liabilities,
--------------------
there are no Liabilities of NBC or its Subsidiaries that will be transferred or
assigned to, or assumed by, NMC in connection with the transactions set forth in
Section 2.2(a) or as to which NMC or Xenon 2 could be liable.
--------------
4.2 Representations and Warranties with respect to SNAP. NBC represents
---------------------------------------------------
and warrants to Xenon 2 as follows:
(a) Due Organization, Power and Good Standing. SNAP is duly organized,
-----------------------------------------
validly existing and in good standing under the laws of its jurisdiction of
organization, and has the requisite power and authority to own, lease and
operate its properties and to conduct its business as now conducted by it. SNAP
is qualified to do business and is in good standing in all jurisdictions in
which it conducts its business, except where the failure to do so would not,
individually or in the aggregate, taken as a whole, have a Material Adverse
Effect. SNAP has no Subsidiaries other than SNAP International LLC which has
not commenced business operations and has no material assets or liabilities.
(b) Authorization and Validity of Agreement. The transfer of the
---------------------------------------
interests in SNAP pursuant hereto have been duly authorized by all necessary
action on the part of SNAP.
(c) Governmental Approvals; Consents. Except as described in Schedule
-------------------------------- --------
4.2(c), the execution, delivery and performance by NBC of this Agreement and the
------
Implementing Agreements to which it is a party and the consummation by NBC of
the transactions contemplated hereby and thereby will not (i) conflict with or
result in a breach of any provision of the SNAP LLC Agreement; (ii) require any
consent, approval, authorization or permit of, or filing with, or notification
to, any Governmental Authority; (iii) require the consent or approval of any
Person (other than a Governmental Authority) or violate or conflict with, or
result in a breach of any provision of, constitute a default (or an event which
with notice or lapse of time or both would become a default) or give to any
third party any right of termination, cancellation, amendment or acceleration
under, or result in the creation of a Lien on any of the assets of SNAP under
any of the terms, conditions or provisions of any contract or license to which
SNAP is a party or by which it or its assets or property are bound; or (iv)
violate or conflict with any order, writ, injunction, decree, statute, rule or
regulation applicable to SNAP; other than any consents, approvals,
authorizations and permits the failure of which to obtain and any violations,
conflicts, breaches defaults and other matters set forth pursuant to clauses
(ii), (iii) and (iv) above which, individually or in the aggregate, would not
reasonably be expected to have a Material Adverse Effect.
<PAGE>
22
(d) Certain Fees. Neither SNAP nor any of the officers, directors or
------------
employees, thereof has employed any broker or finder or incurred any other
Liability for any brokerage fees, commissions or finders' fees in connection
with the transactions contemplated hereby except that SNAP has employed of BT
Alex. Brown Incorporated whose fees and expenses will be paid in accordance with
Section 10.5 of the transactions contemplated by this Agreement are consummated
------------
and otherwise will be paid by SNAP.
(e) Equity Interests. As of the date hereof, the outstanding equity
----------------
interests in SNAP and the holders thereof are set forth on Schedule 4.2(e)
---------------
hereto. All outstanding SNAP Units are duly authorized, validly issued, fully
paid and non-assessable and are not subject to any preemptive rights except as
set forth in the SNAP LLC Agreement and have been issued in compliance with
federal and state securities laws. There are no declared or accrued unpaid
distributions with respect to any SNAP Units. The limited liability company
interests of SNAP International LLC have been duly authorized and issued, and
are fully paid and non-assessable and are owned by SNAP free and clear of all
Liens. Except for the capital stock of its Subsidiaries, SNAP does not own,
directly or indirectly, more than 10% of the capital stock or other ownership
interest in any Person and to the extent it owns less than 10% of the capital
stock or other ownership interest in any Person, such interests in the aggregate
do not constitute a material part of SNAP's assets. Except as set forth on
Schedule 4.2(e) hereto or as provided under the terms of this Agreement, no SNAP
---------------
Units are reserved for issuance, and there are no contracts, agreements,
commitments or arrangements obligating SNAP to (i) offer, sell, issue or grant
any equity interests in, or any options, warrants or rights of any kind to
acquire any equity interests in, or any other securities that are convertible
into or exchangeable for any equity interests in SNAP or (ii) to redeem,
purchase or acquire, or offer to purchase or acquire, any outstanding equity
interests in or any outstanding options, warrants or rights of any kind to
acquire any equity interests in, or any other outstanding securities that are
convertible into or exchangeable for any equity interests in SNAP. At the
Effective Time, after giving effect to the transactions contemplated by the
Xenon 2 Merger Agreement and this Agreement, Xenon 2 will own all of the
outstanding SNAP Units, other than SNAP Units issued pursuant to the exercise of
SNAP Options, free and clear of all Liens.
(f) Financial Information, Liabilities. The unaudited balance sheet
----------------------------------
for SNAP as at December 31, 1998 (the "SNAP Balance Sheet") and the related
------------------
unaudited income statement for the six months ending December 31, 1998, copies
of which are attached hereto as Schedule 4.2(f) present fairly in all material
---------------
respects the financial condition and results of operations of SNAP as at
December 31, 1998 and for the period then ended subject to normal year-end audit
adjustments and financial statement footnote disclosure. Except as set forth on
Schedule 4.2(g), except as and to the extent disclosed in the SNAP Balance
---------------
Sheet, and except for liabilities incurred in connection with the transactions
contemplated by this Agreement and the Implementing Agreements, there are no
liabilities, whether absolute, accrued, contingent or otherwise, of SNAP, that
would be required to be reflected on, or reserved against, in such consolidated
balance sheet of SNAP, except for (x) liabilities which, singly or in the
aggregate, would not have a Material Adverse Effect and (y) liabilities incurred
subsequent to the date of such balance sheet by SNAP in the ordinary course of
business consistent with past practice.
<PAGE>
23
(g) Absence of Certain Changes or Events. Except as disclosed on
------------------------------------
Schedule 4.2(g) since December 31, 1998, SNAP has conducted its business in all
---------------
material respects only in the ordinary course consistent with past practice and
there has not been (i) any material adverse change in the assets, liabilities,
business, results of operations or financial condition of SNAP, or (ii) except
in the ordinary course of business consistent with past practice and except for
such matters that would not reasonably be expected to have a Material Adverse
Effect, any damage, destruction, loss, conversion, condemnation or taking by
eminent domain related to any of its material assets. In addition, except as
disclosed on Schedule 4.2(g), from December 31, 1998 to the date hereof, SNAP
---------------
has not (A) acquired or disposed of any material assets or entered into any
agreement or other arrangement for any such acquisition or disposition or (B)
relinquished, forgiven or canceled any material debts or claims.
(h) Title to Properties; Absence of Liens. Except as disclosed on
-------------------------------------
Schedule 4.2(h), SNAP has good title to (or, in the case of real estate or
---------------
equipment leases, a valid lease to) all of its properties, assets and other
rights, free and clear of all Liens except for Permitted Liens and such assets
will enable Xenon 2 to conduct the business of SNAP after the Effective Time in
substantially the same manner as it is currently being conducted.
(i) Properties, Contracts, Permits and Other Data. Except as
---------------------------------------------
specified in Schedule 4.2(i) hereto, all rights, licenses, leases,
---------------
registrations, applications, contracts, commitments and other agreements of SNAP
or by which SNAP is bound are in full force and effect and are valid and
enforceable in accordance with their respective terms except for such failures
to be in full force and effect and valid and enforceable that would not,
individually or in the aggregate, have a Material Adverse Effect. SNAP is not
in breach or default in the performance of any obligation thereunder and no
event has occurred or has failed to occur whereby any of the other parties
thereto have been or will be released therefrom or will be entitled to refuse to
perform thereunder, the enforcement of which would have, either individually or
in the aggregate, a Material Adverse Effect. SNAP has provided to Xoom complete
and accurate copies of SNAP's current annual budget and operating plan (the
"SNAP Budget").
------------
(j) Legal Proceedings. Except as described in Schedule 4.2(j), there
----------------- ---------------
is no litigation, proceeding or governmental investigation to which SNAP is a
party pending or, to the best Knowledge of SNAP, threatened against it or its
assets which, either individually or in the aggregate, would reasonably be
expected to result in a Material Adverse Effect or which, as of May 9, 1999,
seeks to restrain or enjoin the consummation of any of the transactions
contemplated hereby. SNAP is not a party to nor are its assets subject to any
judgment, writ, decree, injunction or order entered by any court or governmental
authority (domestic or foreign) that, individually or in the aggregate, would
reasonably be expected to have a Material Adverse Effect.
(k) Labor Controversies. Except as set forth on Schedule 4.2(k), (i)
------------------- ---------------
there have been no labor strikes, slow-downs, work stoppages, lock-outs or other
material labor controversies or disputes during the past two years, nor is any
such strike, slow-down, work stoppage or other material labor controversy or
dispute pending or, to the best Knowledge of
<PAGE>
24
NBC, threatened with respect to the current or former employees of SNAP, (ii)
SNAP is not a party to any labor contract, collective bargaining agreement,
contract, letter of understanding or, to Neon's Knowledge, any other agreement,
formal or informal with any labor union or organization, nor are any of SNAP's
employees represented by any labor union or organization and (iii) SNAP has not
closed any facility, effectuated any layoffs of employees or implemented any
early retirement, separation or window program within the past two years nor
planned or announced any such action or program for the future.
(l) Intellectual Property. SNAP owns or is licensed or otherwise has
---------------------
the right to use, all Intellectual Property currently used in its business (the
"SNAP Intellectual Property"), except as would not, individually or in the
--------------------------
aggregate, have a Material Adverse Effect. SNAP has not infringed upon or is in
conflict with the Intellectual Property of any third party nor has SNAP received
any written notice of any claim that it has infringed upon or is in conflict
with any Intellectual Property of any third party, except as would not,
individually or in the aggregate, have a Material Adverse Effect. Except as set
forth on Schedule 4.2(l), none of the rights of SNAP to the SNAP Intellectual
---------------
Property will be impaired in any way by the transactions provided for herein,
and all of the rights of SNAP to the SNAP Intellectual Property will be fully
enforceable by SNAP after the Closing Date to the same extent as such rights
would have been enforceable by SNAP before the Closing, without the consent or
agreement of any other party other than any consents and agreements the failure
of which to obtain, individually or in the aggregate, would not have a Material
Adverse Effect. There have been no claims (whether private or governmental)
against SNAP asserting the invalidity or unenforceability of its ownership,
license or other right to use any of the registered SNAP Intellectual Property.
(m) Government Licenses, Permits, Etc. Except as set forth on
---------------------------------
Schedule 4.2(m), SNAP has all licenses, permits, consents, approvals,
---------------
authorizations, qualifications and orders of Governmental Authorities required
for the conduct of its business as presently conducted, except where failure
would not, individually or in the aggregate, have a Material Adverse Effect.
(n) Conduct of Business in Compliance with Regulatory and Contractual
-----------------------------------------------------------------
Requirements. SNAP has complied with all applicable laws, ordinances,
------------
regulations or orders or other requirements of any Governmental Authority
including, without limitation, all rules, regulations and administrative orders
relating to anti-competitive practices, discrimination, employment, health and
safety, except where the failure to be in such compliance would not have, either
individually or in the aggregate, a Material Adverse Effect.
(o) Environmental Matters. Except as set forth on Schedule 4.2(o) and
--------------------- ---------------
except for matters that, individually or in the aggregate, would not have a
Material Adverse Effect, (i) SNAP complies and has complied with all applicable
Environmental Laws, and possesses and complies with and has possessed and
complied with all Environmental Permits; (ii) there are and have been no
Materials of Environmental Concern, or other conditions, at any property owned
or leased by SNAP that could give rise to any liability under any Environmental
Law or result in costs arising out of any Environmental Law; (iii) no judicial,
administrative, or arbitral proceeding (including any notice of violation or
alleged violation) under any Environmental Law
<PAGE>
25
to which SNAP is, or to the Knowledge of SNAP will be, named as a party is
pending or, to the Knowledge of SNAP, threatened, nor is SNAP the subject of any
investigation in connection with any such proceeding or potential proceeding;
(iv) there are no past, present, or anticipated future events, conditions,
circumstances, practices, plans, or legal requirements that could be expected to
prevent, or materially increase the burden on SNAP of complying with applicable
Environmental Laws or of obtaining, renewing, or complying with all
Environmental Permits required under such laws; and (v) SNAP has provided to the
other parties true and complete copies of all Environmental Reports relating to
it in the possession or control of such party.
(p) Employee Benefit Matters. (i) Schedule 4.2(p) contains a true
------------------------ ---------------
and complete list of each "employee benefit plan" (within the meaning of section
3(3) of ERISA, and all stock purchase, stock option, severance, employment,
change-in-control, fringe benefit, collective bargaining, bonus, incentive,
deferred compensation and other employee benefit plans, agreements, programs,
policies or other arrangements, whether or not subject to ERISA (including any
funding mechanism therefor now in effect or required in the future as a result
of the transaction contemplated by this Agreement or otherwise), whether formal
or informal, oral or written, legally binding or not, under which any employee
or former employee of SNAP or its Subsidiaries has any present or future right
to benefits and under which SNAP or its Subsidiaries has any present or future
liability. All such plans, agreements, programs, policies and arrangements
shall be collectively referred to as the "SNAP Plans".
----------
(ii) With respect to each SNAP Plan which is maintained solely by
SNAP (the "Portal Level Plans"), SNAP has made available to NBC a current,
------------------
accurate and complete copy (or, to the extent no such copy exists, an accurate
description) thereof and, to the extent applicable: (A) any related trust
agreement or other funding instrument; (B) the most recent determination letter,
if applicable; (C) any summary plan description and other written communications
(or a description of any oral communications) by SNAP or its Subsidiaries to
their employees concerning the extent of the benefits provided under a SNAP
Plan; and (D) for the most recent two years (I) the Form 5500 and attached
schedules and (II) audited financial statements.
(iii) (A) Each SNAP Plan has been established and administered in
accordance with its terms, and in compliance with the applicable provisions of
ERISA, the Code and other applicable laws, rules and regulations; (B) each SNAP
Plan which is intended to be qualified within the meaning of Code section 401(a)
is so qualified and has received a favorable determination letter as to its
qualification (or is established using a prototype plan form which has received
such a letter), and nothing has occurred, whether by action or failure to act,
that could reasonably be expected to cause the loss of such qualification; (C)
for each SNAP Plan with respect to which a Form 5500 has been filed, no material
change has occurred with respect to the matters covered by the most recent Form
since the date thereof; (D) no non-exempt "prohibited transaction" (as such term
is defined in ERISA section 406 and Code section 4975) with respect to any SNAP
Plan; and (E) no SNAP Plan provides retiree welfare benefits and neither SNAP
nor its Subsidiaries have any obligations to provide any retiree welfare
benefits except as provided under Section 4980B of the Code.
<PAGE>
26
(iv) No SNAP Plan is subject to Title IV of ERISA (including a
multiemployer plan within the meaning of Section 3(37) of ERISA), no SNAP Plan
is a multiple employer plan; and no SNAP Plan is subject to the minimum funding
requirements of ERISA Section 302 or Code Section 412.
(v) Neither SNAP nor any of its Subsidiaries nor any member of the
Controlled group of which it is a member has (A) engaged in, or is a successor
or parent corporation to an entity that has engaged in, a transaction described
in Sections 4069 or 4212(c) of ERISA or (B) incurred, or could reasonably be
expected to incur, any liability under (I) Title IV of ERISA arising in
connection with the termination of, or a complete or partial withdrawal from,
any plan covered or previously covered by Title IV of ERISA or (II) Section 4971
of the Code that in either case could become a liability of the SNAP or any
Subsidiary or NMC after the Closing Date. The assets of SNAP and all of its
Subsidiaries are not now, nor will they after the passage of time be, subject to
any lien imposed under Code Section 412(n) by reason of a failure of any of the
SNAP or any Subsidiary or any member of the Controlled Group of which it is a
member to make timely installments or other payments required under Code Section
412.
(vi) With respect to any SNAP Plan, (A) no actions, suits or claims
(other than routine claims for benefits in the ordinary course) are pending or,
to the Knowledge of SNAP or its Subsidiaries, threatened and (B) no facts or
circumstances exist that could reasonably be expected to give rise to any such
actions, suits or claims.
(vii) Except as provided on Schedule 4.2(p), no SNAP Plan exists
---------------
that could result in the payment to any present or former employee of SNAP or
its Subsidiaries of any money or other property or accelerate or provide any
other rights or benefits to any present or former employee of SNAP or its
Subsidiaries as a result of the transaction contemplated by this Agreement,
whether or not such payment would constitute a parachute payment within the
meaning of Code Section 280G.
(q) Absence of Certain Business Practices. Neither SNAP, nor any
-------------------------------------
officer, employee or agent of SNAP, nor any other Person acting on behalf of
SNAP, has, directly or indirectly, within the past five years given or agreed to
give any gift or similar benefit to any customer, supplier, governmental
employee or other Person or entity who is or may be in a position to help or
hinder SNAP (or assist SNAP in connection with any actual or proposed
transaction) which (x) subjects any party or NMC or any of their respective
Affiliates, to any damage or penalty in any civil, criminal or governmental
litigation or proceeding, (y) if not given in the past, could have had a
Material Adverse Effect or (z) if not continued in the future, could have a
Material Adverse Effect or which might subject any party or NMC or any of their
respective Affiliates to suit or penalty in any private or governmental
litigation or proceeding.
(r) Tax Matters. Except as set forth on Schedule 4.2(r), (i) SNAP
----------- ---------------
and its Subsidiaries have timely filed (or have had timely filed on their
behalf) or will timely file or cause to be timely filed, all Tax Returns
required by applicable law to be filed by SNAP and its Subsidiaries prior to the
Effective Time. All such Tax Returns are or will be true, complete and correct
in all material respects. There are no outstanding agreements or waivers
extending the
<PAGE>
27
statutory period of limitation applicable to any of such Tax Returns and SNAP
and its Subsidiaries has not requested any extension of time within which to
file any material Tax Return, which return has not yet been filed. There is no
pending claim by any Tax Authority of a jurisdiction where SNAP or any of its
Subsidiaries have not filed Tax Returns that SNAP are any of its Subsidiaries
are or may have been subject to taxation by that jurisdiction. All Taxes
required to be withheld by SNAP or its Affiliates with respect to their
activities, properties, employees or independent contractors have been withheld
and paid over to the appropriate Tax Authority.
(ii) SNAP and its Subsidiaries have paid (or have had paid on their
behalf), or where payment is not yet due, have established (or have had
established on their behalf and for their sole benefit and recourse), or will
establish or cause to be established on or before the Effective Time, an
adequate accrual for the payment of, all Taxes due with respect to any period
beginning prior to the Effective Time. No deficiency or adjustment for any
Taxes has been threatened, proposed, asserted or assessed against SNAP or its
Subsidiaries. There are no liens for Taxes upon the assets of SNAP or its
Subsidiaries, except for liens for current Taxes not yet due.
(iii) SNAP and its Subsidiaries are not required to include in income
any adjustment pursuant to Section 481(a) of the Code or any similar applicable
provision by reason of a voluntary change in accounting method initiated by SNAP
or its Subsidiaries, and neither the Internal Revenue Service nor any taxing
authority has proposed in writing any such adjustment or change in accounting
method. SNAP and its Subsidiaries have not received a tax ruling or entered
into a closing agreement with any taxing authority that would have a Material
Adverse Effect on SNAP or its Subsidiaries.
(iv) SNAP and its Subsidiaries have not made any payments, are not
obligated to make any payments, and are not a party to any agreement that could
obligate it to make any payments that would not be deductible pursuant to
Section 280G of the Code.
(v) SNAP has been and currently is taxable as a partnership for
federal income tax purposes and in all jurisdictions in which it is subject to
Taxes or files Tax Returns. Each of SNAP's Subsidiaries has been and currently
is (A) wholly owned by SNAP and (B) an entity disregarded from its owner
pursuant to Section 301.7701-2 of the Treasury Regulations. Neither SNAP nor
any Subsidiary is a party to any safe harbor lease within the meaning of Section
168(f)(8) of the Code, as in effect prior to amendment by the Tax Equity and
Fiscal Responsibility Act of 1982. SNAP and its Subsidiaries are not a party to
any joint venture, partnership, or other agreement, contract, or arrangement
(either in writing or verbally, formally or informally) which could be treated
as partnership for federal income tax purposes.
(vi) Neither SNAP nor any of its Subsidiaries has a "permanent
establishment," as defined in any applicable Tax treaty or convention of the
United States of America, or fixed place of business in any foreign country.
SNAP and its Subsidiaries are in compliance with the terms and conditions of any
applicable tax exemptions, agreements or orders of any foreign government to
which it may be subject or which it may have claimed, and the
<PAGE>
28
transactions contemplated by this Agreement will not have any adverse effect on
such compliance.
(vii) Neither SNAP nor any of its Subsidiaries is or has been bound by
any tax sharing or tax allocation agreement, and it has no contractual
obligation to indemnify any other person with respect to Taxes.
(s) Year 2000 Compliance. SNAP has adopted and implemented a
--------------------
commercially reasonable plan to provide (x) that the change of the year from
1999 to the year 2000 will not have a Material Adverse Effect and (y) that the
impacts of such change on the venders and customers of SNAP will not have a
Material Adverse Effect. In SNAP's reasonable best estimate, no expenditures
materially in excess of currently budgeted items previously disclosed to Xenon 2
will be required in order to cause the information and business systems of SNAP
to operate properly following the change of the year 1999 to the year 2000.
SNAP reasonably expects any material issues related to such change of the year
will be resolved in accordance with the timetable set forth in such plan (and in
any event on a timely basis in order to be resolved before the year 2000).
Between the date of this Agreement and the Effective Time, SNAP shall continue
to use commercially reasonable efforts to implement such plan.
(t) Options. Except for the SNAP 1998 LLC Option Plan, SNAP has never
-------
adopted or maintained any option plan or other plan providing for equity
compensation of any Person. As of the date hereof, SNAP has reserved 1,604,938
units for issuance pursuant to the SNAP 1998 LLC Option Plan ("SNAP Options"),
------------
of which 1,432,970 have been issued as of the date hereof, all of which units
remain subject to SNAP Options unexercised as of the date hereof. Except as set
forth in Schedule 4.2(t), none of the SNAP Options will be accelerated in any
---------------
way by the transactions contemplated by this Agreement. SNAP has made available
to NBC accurate and complete copies of all option plans pursuant to which SNAP
has granted options and the applicable vesting schedule for each such option.
All units subject to issuance as aforesaid, upon issuance on the terms and
conditions specified in the instruments pursuant to which they are issuable,
would be duly authorized, validly issued, fully paid and non-assessable. Except
as set forth in Schedule 4.2(t), there are no commitments or agreements of any
---------------
character to which SNAP is bound obligating SNAP to accelerate the vesting of
any SNAP Options as a result of this Agreement. Schedule 4.2(e) lists each
---------------
outstanding SNAP Option and identifies with respect to each such SNAP Option;
its exercise price; its grant date; its vesting schedule; and what portion of
such SNAP Option remains outstanding as of the date hereof. NBC shall prepare
and deliver to Xenon 2 and Xoom an updated version of Schedule 4.2(e) prior to
---------------
the Effective Time as of a date no earlier than 5 days prior to the Effective
Time.
4.3 Representations and Warranties of Xoom and Xenon 2. Xoom and Xenon 2
--------------------------------------------------
represent and warrant to NBC and NMC as follows:
(a) Due Organization, Power and Good Standing. Xoom, Xenon 2 and each
-----------------------------------------
of their respective Subsidiaries is duly organized, validly existing and in good
standing under the laws of its jurisdiction of organization, and has the
requisite power and authority to own, lease and operate its properties and to
conduct its business as now conducted by it. Xoom, Xenon 2
<PAGE>
29
and each of their respective Subsidiaries party to an Implementing Agreement has
all requisite power and authority to enter into this Agreement, the Xenon 2
Merger Agreement, the Voting Agreement, the Option Agreement and the
Implementing Agreements to which it is a party and to perform its obligations
hereunder and thereunder. Xoom, Xenon 2 and each of their respective
Subsidiaries is qualified to do business and is in good standing in all
jurisdictions in which it conducts its business, except where the failure to do
so would not, individually or in the aggregate, taken as a whole, have a
Material Adverse Effect.
(b) Authorization and Validity of Agreement. The execution, delivery
---------------------------------------
and performance by Xoom, Xenon 2 and each of their respective Subsidiaries of
this Agreement, the Xenon 2 Merger Agreement, the Voting Agreement, the Option
Agreement and the Implementing Agreements to which Xoom, Xenon 2 or their
respective Subsidiaries is a party and the consummation by Xoom, Xenon 2 and
each of their respective Subsidiaries of the transactions contemplated hereby
and thereby have been duly authorized by all necessary corporate action on the
part of Xoom, Xenon 2 and each of their respective Subsidiaries, subject to
obtaining, in the case of the Xenon 2 Merger Agreement, the Stockholder Approval
(as defined therein), and, in the case of this Agreement, the affirmative vote
of the holders of a majority of the outstanding shares of common stock of Xenon
2 (the "Xenon 2 Stockholder Approval"). The Board of Directors of Xoom, by
----------------------------
resolutions duly adopted by unanimous vote with one abstention at a meeting duly
called and held and not subsequently rescinded or modified in any way, has duly
determined that this Agreement is advisable for Xoom and its stockholders,
approved this Agreement and the Merger and recommended that the stockholders of
Xoom adopt the Xenon 2 Merger Agreement and approve the transactions
contemplated thereby and vote in favor of Xoom, as sole stockholder of Xenon 2,
adopting the NMC Agreement at the Xenon 2 Stockholder Meeting. Each of this
Agreement, the Xenon 2 Merger Agreement, the Option Agreement and the Voting
Agreement has been, and each of the other Implementing Agreements to which Xoom,
Xenon 2 or any of their respective Subsidiaries is a party will on the Closing
Date be, duly executed and delivered by Xoom, Xenon 2 and each of their
respective Subsidiaries and constitutes or, in the case of the other
Implementing Agreements, upon execution thereof will constitute, a valid and
legally binding obligation of Xoom, Xenon 2 and each of their respective
Subsidiaries, enforceable against each in accordance with their respective
terms.
(c) Governmental Approvals; Consents. Except as described in Schedule
-------------------------------- --------
4.3(c), the execution, delivery and performance of this Agreement, the Xenon 2
------
Merger Agreement, the Voting Agreement, the Option Agreement and the
Implementing Agreements by Xoom, Xenon 2 and each of their respective
Subsidiaries and the consummation by such party of the transactions contemplated
hereby and thereby will not (i) conflict with or result in a breach of any
provision of the certificate of incorporation or bylaws or other governing
documents of Xoom, Xenon 2 or their respective Subsidiaries; (ii) require any
consent, approval, authorization or permit of, or filing with or notification
to, any Governmental Authority; (iii) require the consent or approval of any
Person (other than a Governmental Authority) or violate or conflict with, or
result in a breach of any provision of, constitute a default (or an event which
with notice or lapse of time or both would become a default) or give to any
third party any right of termination, cancellation, amendment or acceleration
under, or result in the creation of a Lien on any of the assets of Xoom, Xenon 2
or any of their respective Subsidiaries under, any of the
<PAGE>
30
terms, conditions or provisions of any contract or license to which Xoom, Xenon
2 or any of their respective Subsidiaries is a party or by which it or its
assets or property are bound; or (iv) violate or conflict with any order, writ,
injunction, decree, statute, rule or regulation applicable to Xoom, Xenon 2 or
any of their respective Subsidiaries; other than any consents, approvals,
authorizations and permits the failure of which to obtain and any violations,
conflicts, breaches defaults and other matters set forth pursuant to clauses
(ii), (iii) and (iv) above which, individual ly or in the aggregate, would not
reasonably be expected to have a Material Adverse Effect.
(d) Certain Fees. None of Xoom, Xenon 2 or any of their respective
------------
Subsidiaries nor the officers, directors or employees thereof have employed any
broker or finder or incurred any other Liability for any brokerage fees,
commissions or finders' fees in connection with the transactions contemplated
hereby; except that Xoom has employed Bear, Stearns & Co., Inc. and Hambrecht &
Quist, LLC whose fees and expenses will be paid in accordance with Section 10.5
------------
if the transactions contemplated by this Agreement are consummated and otherwise
will be paid by Xoom. Xoom has provided NBC a copy of the engagement letter
entered into with Hambrecht & Quist, LLC related to the transactions
contemplated hereby.
(e) Opinion of Financial Advisor. Xoom has received the opinion of
----------------------------
each of Bear, Stearns & Co. Inc. and Hambrecht & Quist, LLC, in each case as of
the date hereof, with respect to the fairness of the transactions contemplated
by this Agreement from a financial point of view.
(f) Capital Stock. (i) The authorized capital stock of Xoom consists
-------------
of 40,000,000 shares of Xoom Stock and 5,000,000 shares of Xoom Preferred Stock,
of which 17,162,056 shares of Xoom Stock and no shares of Xoom Preferred Stock
have been issued and are outstanding as of the date hereof. All outstanding
shares of Xoom Stock are duly authorized, validly issued, fully paid and non-
assessable and not subject to preemptive rights created by statute, the
certificate of incorporation or bylaws of Xoom or any agreement to which Xoom is
a party or by which it is bound and have been issued in compliance with federal
and state securities laws. There are no declared or accrued unpaid dividends
with respect to any shares of Xoom Stock. All of the shares of capital stock of
each of the Subsidiaries of Xoom are duly authorized and issued, fully paid and
nonassessable and are owned by Xoom or another Subsidiary of Xoom free and clear
of all Liens. Except for the capital stock of its Subsidiaries, Xoom does not
own, directly or indirectly, any capital stock or other ownership interest in
any Person.
(ii) As of the date hereof, the authorized capital stock of Xenon 2
consists of 100 shares of common stock, par value $0.0001 per share, of which
100 shares have been issued and are outstanding as of the date hereof. Prior to
the Closing Date, Xenon 2's certificate of incorporation will be amended to
provide for an authorized capital stock sufficient to permit Xenon 2 to issue
all of the Class A Common Stock and Class B Common Stock to be issued by Xenon 2
pursuant to this Agreement and the Xenon 2 Merger Agreement. All capital stock
issued by Xenon 2 pursuant to the Xenon 2 Merger Agreement and this Agreement
will be duly authorized, validly issued, fully paid and non-assessable and not
subject to preemptive rights created by statute, the certificate of
incorporation or bylaws of Xenon 2 or any agreement to which Xenon 2 is a party
or by which it is bound and issued in compliance with federal and state
<PAGE>
31
securities laws. All of the shares of capital stock of each of the Subsidiaries
of Xenon 2 are duly authorized and issued, fully paid and nonassessable and are
owned by Xenon 2 free and clear of all Liens. Except for the capital stock of
its Subsidiaries, Xenon 2 does not own, directly or indirectly, any capital
stock or other ownership interest in any Person.
(g) Stock Options. Except for the Xoom 1998 Employee Stock Purchase
-------------
Plan (the "Xoom ESPP"), the Xoom Option Plan pursuant to which the Xoom Plan
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Options were issued, and the Xoom Non-Plan Options (together with the Xoom Plan
Options, the "Xoom Options"), none of Xoom, Xenon 2 or any of their respective
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Subsidiaries has ever adopted or maintained any stock option plan or other plan
providing for equity compensation of any person. As of the date hereof, Xoom has
reserved 3,535,224 shares of Xoom Stock for issuance pursuant to the Xoom ESPP,
Xoom Plan Options and Xoom Non-Plan Options, of which 3,336,157 have been issued
as of the date hereof, of which 2,043,556 shares remain subject to Xoom Plan
Options unexercised as of the date hereof and 981,212 shares remain subject to
Xoom Non-Plan Options unexercised as of the date hereof. Except pursuant to
Section 6.8 and as reflected on Schedule 4.3(g) none of the Xoom Options will be
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accelerated in any way by the transactions contemplated by this Agreement.
Xoom, Xenon 2 and their respective Subsidiaries have made available to NMC
accurate and complete copies of all stock option plans pursuant to which Xoom,
Xenon 2 and their respective Subsidiaries have granted stock options that are
currently outstanding, the form of all stock option agreements evidencing such
options and the applicable vesting schedule for each such option. All shares of
Xoom Stock and Class A Common Stock subject to issuance as aforesaid, upon
issuance on the terms and conditions specified in the instruments pursuant to
which they are issuable, would be duly authorized, validly issued, fully paid
and non-assessable. Except as set forth in Schedule 4.3(g) or as contemplated by
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this Agreement, there are no commitments or agreements of any character to which
Xoom, Xenon 2 or any of their respective Subsidiaries are bound obligating Xoom,
Xenon 2 or any of their respective Subsidiaries to accelerate the vesting of any
Xoom Option as a result of this Agreement. Schedule 4.3(g) lists each
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outstanding Xoom Option and identifies with respect to each such Xoom Option
whether it is a Xoom Plan Option or a Xoom Non-Plan Option; its exercise price;
its grant date; its vesting schedule; and what portion of such Xoom Option
remains outstanding as of the date hereof. Xoom, Xenon 2 and their respective
Subsidiaries shall prepare and deliver to NMC an updated version of Schedule
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4.3(g) prior to the Effective Time as of a date no earlier than 5 days prior to
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the Effective Time.
(h) Obligations With Respect to Capital Stock. Except as set forth in
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Section 4.3(f) and Section 4.3(g) and on Schedule 4.3(h), there are no equity
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securities, partnership interests or similar ownership interests of any class of
any equity security of Xoom, Xenon 2 or any of their respective Subsidiaries, or
any securities exchangeable or convertible into or exercisable for such equity
securities, partnership interests or similar ownership interests, issued,
reserved for issuance or outstanding. Except as set forth in Schedule 4.3(h) or
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as set forth in Section 4.3(g) hereof, there are no subscriptions, options,
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warrants, equity securities, partnership interests or similar ownership
interests, calls, rights (including preemptive rights), commitments or
agreements of any character to which Xoom, Xenon 2 or any of their respective
Subsidiaries is a party or by which Xoom, Xenon 2 or any of their respective
Subsidiaries is bound obligating Xoom, Xenon 2 or any of their respective
Subsidiaries to issue, deliver or sell, or cause to be
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