Appendix C
March 13, 2000
Board of Directors
DynamicWeb Enterprises, Inc.
000 Xx. 00 Xxxx
Xxxxxxxx X
Xxxxxxxxx XX 00000
Ladies and Gentlemen:
DynamicWeb Enterprises, Inc., a New Jersey company ("DWEB"), and eB2B Commerce,
Inc. ("eCom"), a Delaware company, have entered into an agreement and plan of
merger, as amended (the "Agreement") providing for the merger (the "Merger") of
eCom into DWEB. The Merger is expected to take place on or around April 21,
2000. Capitalized terms used herein without definition have the meanings set
forth in the Agreement.
In accordance with the Agreement, the proposed Merger will be accomplished by:
Common Stock Conversion. At the Effective Time, each outstanding share of
eCom Common Stock shall be converted into the right to receive a number of
shares of DWEB Common Stock equal to one share of eCom Common Stock
multiplied by the Exchange Ratio. The Exchange Ratio has been fixed at 2.66
DynamicWeb shares, subject to adjustments set forth in the Agreement, for
each eCom share.
Preferred Stock and Other Securities Conversion. At the Effective Time,
each share of eCom Preferred Stock, and each eCom Option and other security
convertible into eCom Common Stock outstanding immediately prior to the
Effective Time, shall be converted into the right to receive, respectively,
shares of DWEB Preferred Stock, Company Options or other securities
convertible into DWEB Common Stock, as the case may be. The number of
shares of DWEB Common Stock issuable upon exercise or conversion of each
share of such DWEB Preferred Stock, and each DWEB Option or other security
convertible into DWEB Common Stock shall be calculated by multiplying (i)
the number of shares of eCom Common Stock into which each share of such
eCom Preferred Stock, each eCom Option or other security convertible into
eCom Common Stock is exercisable or convertible by (ii) the Exchange Ratio.
The exercise or conversion price of each share of such DWEB Preferred
Stock, each DWEB Option or other security convertible into DWEB Common
Stock shall be calculated by dividing (i) the exercise or conversion price
of each share of such eCom Preferred Stock, each eCom Option or other
security convertible into eCom Common Stock by (ii) the Exchange Ratio.
You have asked us whether or not, in our opinion, the proposed Merger through
the exchange of shares as described above, is fair, from a financial point of
view, to your shareholders.
In arriving at the opinion set forth below, we have among other things:
1. Reviewed the Agreement;
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2. Reviewed DWEB's recent SEC filings including its most recently available
Annual Report on Form 10-KSB and certain Quarterly Reports on Forms
10-QSB;
3. Reviewed DWEB's internal business and financial analyses prepared by
XXXX's management;
4. Reviewed certain internal financial analyses and business forecasts
for Netlan and eB2B prepared by management and agents of each firm;
5. Reviewed eCom's private placement memorandum dated November 1, 1999
including subsequent amendments and updates to the memorandum, and recent
financial results;
6. Reviewed the audited financial results for the years ending December 31,
1998 and 1999, respectively, for eCom;
7. Reviewed the audited financial results for the years ending December 31,
1998 and 1999 for Xxxxxx, and the unaudited financial results for the year
ended December 31, 1997;
8. Visited the corporate headquarters of DWEB, eCom and Xxxxxx and conducted
meetings with members of management of these three firms to discuss their
respective businesses and business prospects;
9. Performed a variety of financial and comparative analyses, including,
but not limited to:
i) Evaluation of certain financial information and ratios of
publicly-traded companies similar to DWEB, eCom and Netlan;
ii) Evaluation of the financial terms of the proposed Merger;
iii) Comparison of the financial terms of the proposed Merger with
certain other mergers, acquisitions and business combination
transactions we deemed to be relevant; and
iv) Review of such other financial studies and analyses and performance
of such other investigations and consideration of such other matters
as we deemed necessary, including our assessment of general
economic, market and monetary conditions.
Due to the significant reorganization of the businesses of DWEB, eCom and Xxxxxx
and the uncertain nature of long-term consolidated, pro forma projections
anticipated to result from the Merger, we did not perform a discounted cash flow
analysis to arrive at our opinion.
In preparing our opinion, we have relied upon and assumed without independent
verification, the accuracy and completeness of all publicly available financial
information and all financial information furnished or otherwise communicated to
us by DWEB, eCom and Netlan. We have not made any appraisal of the assets of
DWEB, eCom or Netlan, nor have we evaluated any other business combinations or
acquisitions contemplated by either DWEB, eCom or Netlan, nor have we expressed
any opinion as to what the value of DWEB will be after the Merger is consummated
or the price at any time at which the common stock of DWEB will trade after the
Merger. Our opinion does not address the underlying business decision to enter
into the Merger.
It is understood that this letter may not be disclosed or otherwise referred to
without our prior consent, except as may otherwise be required by law or by a
court of competent jurisdiction; provided, however, that we hereby consent to
the inclusion of this opinion in any registration statement or proxy statement
used in connection with the Merger so long as the opinion is included in its
entirety in such registration statement or proxy statement.
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On the basis of, and subject to the foregoing, we are of the opinion that the
proposed issuance of shares contemplated by the Merger is fair to DWEB's
shareholders, from a financial point of view.
Sincerely,
Xxxxxxxx, Xxxxxx & Xxxxxxxxxx, Inc.
Xxxxxxx X. Xxxxxxxxx
Executive Vice President
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