Form of Escrow Agreement.



 Exhibit 10.4 
  
 FORM OF ESCROW AGREEMENT 
  
 This ESCROW AGREEMENT, dated as of April [    ], 2004, (this “Agreement”), is by and among Internet Capital Group, Inc., a
Delaware corporation (the “Company”), JPMorgan Chase Bank, a New York corporation, as escrow agent (the “Escrow Agent”) and the parties set forth on Schedule I to this Agreement (each a
“Buyer” and collectively, the “Buyers”). The Company and the Buyers are collectively referred to herein as the “Escrow Parties”. 
  
 WHEREAS, the Company and the Buyers have entered into that certain Securities Purchase Agreement, dated as of March 31, 2004
(the “Securities Purchase Agreement”); 
  
 WHEREAS, subject to the terms and conditions of the Securities Purchase Agreement, the Company has agreed to sell to each Buyer, and each Buyer has agreed to purchase from the Company, the aggregate principal amount of the Company’s 5%
Senior Convertible Notes (the “Notes”) set forth opposite such Buyer’s name under the heading “Principal Amount” on Schedule II hereto (which aggregate principal amount for all Buyers equals $60,000,000);

  
 WHEREAS, subject to the terms and conditions of the Securities
Purchase Agreement, as consideration for the issuance of the Notes, each Buyer has agreed to pay to the Company the purchase price set forth opposite such Buyer’s name under the heading “Purchase Price” on Schedule I hereto
(which aggregate principal amount for all Buyers equals $60,000,000) (the “Purchase Price”); 
  
 WHEREAS, the Company has agreed to use a portion of the proceeds from the sale of the Notes to redeem the Company’s outstanding 51⁄2% Convertible
Subordinated Notes due 2004 issued pursuant to the Indenture, dated as of December 21, 1999 (the “Indenture”), between the Company and Chase Manhattan Trust Company, National Association, as trustee (the “Trustee”);

  
 WHEREAS, the Closing (as defined in the Securities Purchase
Agreement) is conditioned upon certain matters discussed in Section 7 of the Securities Purchase Agreement; 
  
 WHEREAS, the Escrow Parties hereto desire the Escrow Agent to receive, hold and dispose of the Escrow (as defined below) in accordance with the terms,
conditions and provisions of this Agreement, and the Escrow Agent desires to do so. 
  
 NOW THEREFORE, in consideration of the representations, warranties and covenants contained herein and for other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the
parties hereto hereby agree as follows: 
  
 1. Appointment and
Agreement of Escrow Agent. The Escrow Parties hereby jointly appoint the Escrow Agent to serve hereunder and the Escrow Agent hereby accepts such appointment and agrees to perform all duties that are expressly set forth in this Agreement to be
performed by it. 
  
 2. Securities Purchase Agreement;
Definitions. The Escrow Agent hereby acknowledges receipt of a copy of the Securities Purchase Agreement; however, except for 

  









 
reference thereto for definitions of certain words or terms not defined herein, the Escrow Agent is not charged with knowledge of the terms thereof, or with
any duties or responsibilities with respect thereto except as stated expressly herein. Capitalized terms used but not defined herein have the respective meanings set forth in the Securities Purchase Agreement. 
  
 3. Delivery of Escrow; Investment of Escrow. 
  
 (a) The Escrow Agent hereby acknowledges (i) receipt from
each Buyer of the purchase price set forth opposite such Buyers name under the heading “Purchase Price” on Schedule I hereto (the “Cash Escrow”), (ii) receipt from the Company of the Notes set forth on Schedule
II hereto, duly executed by the Company and issued in the name of the parties set forth on Schedule II hereto in the principal amount set forth on Schedule II hereto (the “Note Escrow”) and (iii) receipt from the
Company of a duly executed and undated notice of redemption pursuant to Article XI of the Indenture notifying the Trustee of the Company’s intention to redeem all of the Existing Notes then outstanding (the “Notice Escrow”, and
together with the Cash Escrow and the Note Escrow, the “Escrow”). The Escrow Agent shall establish at its offices located at 4 New York Plaza, 15th Floor, New York, New York 10004 an interest-bearing escrow account (the
“Escrow Account”) in which it shall hold the Cash Escrow and a secure location in which it shall hold the Note Escrow and the Notice Escrow. The Escrow Agent agrees to hold and dispose of the Escrow, and to act as Escrow Agent, in
accordance with all the terms, conditions and provisions of this Agreement. The Escrow Agent shall have the right to liquidate any investments held in escrow in order to provide funds necessary to make required payments under this Agreement. The
Escrow Agent in its capacity as escrow agent hereunder shall not have any liability for any loss sustained as a result of any investment made pursuant hereto. 
  

(b) During the term of this Agreement, the Cash Escrow shall be invested and reinvested by the Escrow Agent in a JPMorgan Trust Deposit
Account. Periodic statements will be provided to the Escrow Parties reflecting transactions executed on behalf of the Cash Escrow. The Escrow Parties, upon written request, will receive a statement of transaction details upon completion of any
securities transactions in the Cash Escrow without additional cost. The Escrow Agent shall have a right to liquidate any investments held in order to provide funds necessary to make required payments under this Agreement. 
  
 4. Interest. The Escrow Agent shall create separate accounts for each
Buyer’s deposit for the purpose of allocating to each deposit all interest that accrues on such deposit. Upon distribution of any portion of the Cash Escrow, in accordance with Section 5 hereof, the Escrow Agent shall deliver and pay to the
party receiving such distribution all of the interest accrued on the portion of the Cash Escrow allocated to the portion of the Cash Escrow distributed to such party. The Escrow Agent shall file any Internal Revenue Service forms as may be required
to report payment of any such interest, and the party receiving such interest shall execute and deliver any documents reasonably requested by the Escrow Agent in connection therewith. Simultaneous with the execution of this Agreement, the Buyers and
the Company shall each provide the Escrow Agent with a fully executed W-8 or W-9 IRS form, which shall include the Buyers’ and the Company’s TIN. 
  

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 5. Escrow. The Escrow Agent shall not release any of the Escrow, except in accordance with and
subject to the following terms and conditions: 
  
 (a) Escrow Release. Immediately following the receipt by the Escrow Agent of a notice in substantially the form of Annex I hereto (a “Escrow Release Notice”) duly executed by the Company and Langley Capital,
L.P., as a representative of the Buyers, the Escrow Agent shall: 
  
 (i) release and deliver to each Buyer the Escrow Notes registered to such Buyer; 
  
 (ii) release and deliver to the Trustee the Notice of Redemption, which the Escrow Agent shall date as of the date of the delivery of such
Notice of Redemption; 
  
 (iii) release and
deliver to the Trustee (or to the paying agent specified in the Escrow Release Notice (if any) the amount of money specified in the Escrow Release Notice (such amount, the “Redemption Amount”); and 
  
 (iv) release and deliver to the Company an amount equal to
the balance of the Cash Escrow (including all interest that has accrued on the Cash Escrow) minus the Redemption Amount. 
  
 (b) Escrow Termination. Immediately following the earlier to occur of (1) the delivery to the Escrow Agent of a notice in
substantially the form of Annex II hereto (a “Escrow Termination Notice”) duly executed by the Company and Langley Capital, L.P., as a representative of the Buyers, and (2) the failure of the Escrow Agent to receive either
the Escrow Release Notice or the Escrow Termination Notice prior to 9:00 a.m. (New York City time) on June 22, 2004, the Escrow Agent shall: 
  
 (i) release and deliver to each Buyer the portion of the Cash Escrow deposited by such Buyer with the Escrow Agent (plus all interest that
has accrued on such amount); and 
  
 (ii) release
and deliver to the Company the Notice of Redemption and the Notes. 
  
 6. Payments; Deliveries. 
  
 (a)
Any amount of cash to be paid to an Escrow Party pursuant to this Agreement shall be paid to such Escrow Party pursuant to the instructions set forth for such Escrow Party in Schedule III hereto and any further instructions given by such
Escrow Party. Any amount of cash to be paid to the Trustee pursuant to this Agreement shall be paid to the Trustee (or, if specified in the Escrow Release Notice, the paying agent designated by the Trustee) in accordance with the instructions set
forth in the Escrow Release Notice. 
  
 (b) Any
items to be delivered to the Company pursuant to this Agreement shall be delivered by a nationally recognized overnight courier, or delivered by hand against written receipt, to the address for the Company set forth in Section 8, or at such other
address as it shall have furnished to the Escrow Agent and the Buyers in writing. Any items to be delivered to a Buyer pursuant to this Agreement shall be delivered by a nationally recognized overnight courier, or delivered by hand against written
receipt, to the address for such Buyer set forth in Schedule I hereto, or at such other address as it shall have furnished to the Escrow Agent and the 

  

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Company in writing. Any items to be delivered to the Trustee pursuant to this Agreement shall be delivered by a nationally recognized overnight courier, or
delivered by hand against written receipt, to the address for the Trustee set forth in the Escrow Release Notice. 
  
 7. The Escrow Agent. 
  
 (a) The Escrow Agent shall have no duties or obligations hereunder except those specifically set forth herein and such duties and
obligations shall be determined solely by the express provisions of this Agreement. The Escrow Agent shall have no liability under and no duty to inquire as to the provisions of any agreement other than this Escrow Agreement. In connection with its
duties hereunder, the Escrow Agent shall be protected in acting or refraining from acting upon any written notice, request, consent, certificate, order, affidavit, letter, telegram or other document furnished to it hereunder and believed by it to be
genuine and to have been signed or sent by the proper party or parties, and the Escrow Agent shall not be liable for anything it may do or refrain from doing in connection with its duties hereunder, except for such liabilities as may result from its
own gross negligence or willful misconduct. In the administration of the Escrow Account, the Escrow Agent may execute any of its powers and perform its duties hereunder directly or through agents or attorneys and may consult with counsel,
accountants and other skilled persons to be selected and retained by it. The Escrow Agent shall not be liable for the performance of agents selected by it with reasonable care or for anything done, suffered or omitted in good faith by it in
accordance with the advice or opinion of any such counsel, accountants or other skilled persons. 
  
 (b) In the event the Escrow Agent shall be uncertain as to its duties or rights under this Agreement or shall receive any instruction,
claim or demand that, in the opinion of the Escrow Agent, is in conflict with the provisions of this Agreement (any of the foregoing, an “Escrow Agent Dispute”), the Escrow Agent shall be entitled to refrain from taking any action
with respect to such Escrow Agent Dispute until it shall be directed otherwise by a final and nonappealable order of a court of competent jurisdiction or by an instrument signed by all of the Escrow Parties. In the event of any Escrow Agent Dispute,
the Escrow Agent shall be entitled to petition a court of competent jurisdiction in the County of New York, State of New York to resolve such Escrow Agent Dispute, and each of the Escrow Parties consent to the jurisdiction of any such court with
respect to any such Escrow Agent Dispute. 
  
 (c)
The Escrow Agent shall be reimbursed for all reasonable fees and expenses, including without limitation those fees set forth on Schedule IV hereto and reasonable counsel fees and disbursements, incurred by the Escrow Agent in connection with
the performance of its duties and obligations under this Agreement. The Company shall be responsible for all such reasonable fees and expenses. The Company shall be liable for the payment of all such fees and expenses incurred by the Escrow Agent,
except for such fees and expenses incurred by the Escrow Agent due to (i) the failure of an Escrow Party to comply with any of its obligations hereunder or (ii) the requirement by an Escrow Party that the Escrow Agent perform duties outside the
scope of this Agreement, which fees and expenses set forth in the immediately preceding clauses (i) and (ii) shall be paid by the applicable Escrow Party. 
  
 (d) The Escrow Agent may resign at any time by giving at least 30 days’ prior written notice to the Escrow Parties, which resignation
shall become effective upon the acceptance of appointment by the successor Escrow Agent as provided in this Section 6(d). The 

  

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resigning Escrow Agent may appoint a successor Escrow Agent, reasonably acceptable to the Escrow Parties. If a successor Escrow Agent shall not have been
appointed within 20 days after such notice of resignation, any of the Escrow Parties may apply to any court of competent jurisdiction to appoint a successor Escrow Agent. Notwithstanding the foregoing, any successor Escrow Agent shall be a financial
institution organized under the laws of the United States of America and having a combined capital and surplus of not less than US $100,000,000. Any successor Escrow Agent, however appointed, shall execute and deliver to the predecessor Escrow
Agent, with a copy to each of the Escrow Parties, an instrument accepting such appointment, and thereupon such successor Escrow Agent shall, without further act, become fully vested with all the rights, powers, obligations and duties of the
predecessor Escrow Agent hereunder with the same effect as if originally named the Escrow Agent herein. The Escrow Agent shall have the right to withhold an amount equal to any amount due and owing to the Escrow Agent, plus any reasonable costs and
expenses the Escrow Agent reasonably believes may be incurred by the Escrow Agent in connection with termination of this Agreement. 
  
 8. Notices. All notices, requests and other communications to any party hereunder shall be in writing and shall be deemed to be effective and to
have been duly given only if delivered by a nationally recognized overnight courier, or delivered by hand against written receipt, or sent by facsimile, addressed as follows: 
  
 (a) if to the Company, addressed to it at the following address, or at such other address as it shall have
furnished to the Escrow Agent and the Buyers in writing: 
  
 Internet Capital Group, Inc. 
 690 Lee Road, Suite 310 
 Wayne, Pennsylvania 19087 
 Telephone:     (610) 727-6900 
 Facsimile:      (610) 727-6901 
 Attention:       General Counsel and 
     Vice President, Treasury and Tax 
  
 with a copy to: 
  
 Dechert LLP 
 1717 Arch Street 
 Philadelphia, Pennsylvania
19103 
 Telephone:     (215) 994-4000 
 Facsimile:      (215) 994-2222 
 Attention:
      Henry N. Nassau, Esq. 
      and Christopher G. Karras, Esq.

  
 (b) If to Escrow Agent, addressed to it at
the following address, or at such other address as it shall have furnished to the Escrow Parties in writing: 
  
 JPMorgan Chase Bank 
 4 New York Plaza, 15th
Floor 
 New York, New York 10004 
 Attention:       Ms. Vicky Caldas 
 Facsimile:      (212) 623-6168

  

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 (c) If to a Buyer, addressed to it at the address set forth for such Buyer on Schedule
I to this Agreement, or at such other address as it shall have furnished to the Escrow Agent and the Company in writing, with a copy to such Buyer’s representatives as set forth on the Schedule I hereto and (for informational
purposes only) a copy to: 
  
 Morgan, Lewis & Bockius LLP

 1701 Market Street 
 Philadelphia, Pennsylvania 19103 
 Telephone:     (215) 963-5000 
 Facsimile:      (215) 963-5001 
 Attention:       Richard A. Silfen, Esq. 
      and Robert G. Robison, Esq. 
  
 9. Assignment. This Agreement shall be binding upon and inure to the benefit of and be enforceable by the parties hereto and their respective successors, legal representatives, executors, administrators and permitted assigns. None of
the Escrow Parties nor (except as otherwise provided in Section 7(d) hereof) the Escrow Agent may assign, delegate or otherwise transfer any of its rights or obligations under this Agreement without prior written consent of the other Escrow Party.

  
 10. Amendments; No Waivers. 
  
 (a) Any provision of this Agreement may be amended or waived
only if such amendment or waiver is in writing and signed, in the case of an amendment, by the Escrow Agent and all of the Escrow Parties or, in the case of a waiver, by the Escrow Party against whom the waiver is to be enforced. 
  
 (b) No failure or delay by any party hereto in exercising
any right, power or privilege hereunder shall operate as a waiver thereof nor shall any single or partial exercise thereof preclude any other or further exercise thereof or the exercise of any other right, power or privilege. The rights and remedies
herein provided shall be cumulative and not exclusive of any rights or remedies provided by law. 
  
 11. Descriptive Headings. The descriptive headings of the Sections and subsections of this Agreement are inserted for convenience only and do not
constitute a part of this Agreement. 
  
 12. Governing Law;
Waiver of Jury Trial. This Agreement shall be governed by and construed and interpreted in accordance with the substantive Laws of the State of New York, without giving effect to any choice of Law or conflicts of Law provision or rule that would
cause the application of the Laws of any jurisdiction other than the State of New York. Each party hereto irrevocably waives any objection on the grounds of venue, forum non-conveniens or any similar grounds and irrevocably consents to service of
process by mail or in any other manner permitted by applicable Law and consents to the jurisdiction of the courts located in the State of New York. THE PARTIES FURTHER HEREBY WAIVE ANY RIGHT TO A TRIAL BY 

  

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JURY WITH RESPECT TO ANY LAWSUIT OR JUDICIAL PROCEEDING ARISING OUT OF OR RELATING TO THIS AGREEMENT. 
  
 13. Counterparts. This Agreement may be executed in any number of
counterparts, each of which shall be deemed an original, but all of which together shall together constitute one and the same instrument. All signatures of the parties hereto may be transmitted by facsimile and such facsimile will, for all purposes,
be deemed to be the original signature of the party whose signature it reproduces and will be binding upon such party. 
  
 14. Entire Agreement. This Agreement and the Securities Purchase Agreement sets forth the sole and entire agreement between the parties hereto with
respect to the subject matter hereof and supersedes all prior agreements and understandings, whether written or oral, with respect to such subject matter. The Schedules and Annexes to this Agreement are hereby incorporated by reference into and made
a part of this Agreement for all purposes. 
  
 15.
Indemnification. The Escrow Parties shall jointly and severally indemnify, defend and hold harmless the Escrow Agent from any loss, liability or expense incurred by the Escrow Agent (including the fees and expenses of in-house or outside
counsel) arising out of or in connection with (a) its execution and performance of this Agreement, except to the extent that such loss, liability or expense is due to the gross negligence or willful misconduct of the Escrow Agent, or (b) its
following any instructions or other directions from the Escrow Parties, except to the extent that its following any such instruction or direction is expressly forbidden by the terms hereof. Anything in this Agreement to the contrary notwithstanding,
in no event shall the Escrow Agent be liable for special, indirect or consequential loss or damage of any kind whatsoever (including but not limited to lost profits), even if the Escrow Agent has been advised of the likelihood of such loss or damage
and regardless of the form of action. The parties hereto acknowledge that the foregoing indemnities shall survive the resignation or removal of the Escrow Agent and the termination of this Agreement. The Escrow Parties hereby grant the Escrow Agent
a lien on, right of set-off against and security interest in the Escrow for the payment of any claim for indemnification, compensation, expenses and amounts due hereunder. 
  
 16. Compliance. Upon execution of this Agreement, the Escrow Parties shall provide the Escrow Agent with a fully
executed W-8 or W-9 Internal Revenue Service form for each of the Escrow Parties. All interest or other income earned under this Agreement shall be allocated and paid as provided herein and reported by the recipient to the Internal Revenue Service
as having been so allocated and paid. 
  
 17. Successor
Corporations. Any corporation into which the Escrow Agent in its individual capacity may be merged or converted or with which it may be consolidated, or any corporation resulting from any merger, conversion or consolidation to which the Escrow
Agent in its individual capacity shall be a party, or any corporation to which substantially all the corporate trust business of the Escrow Agent in its individual capacity may be transferred, shall constitute the Escrow Agent under this Agreement
without further act. 
  
 18. Call-Backs; Reliance.

  
 (a) In the event funds transfer instructions
are given (other than in writing at the time of execution of the Agreement), whether in writing, by facsimile or otherwise, the 

  

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Escrow Agent is authorized to seek confirmation of such instructions by telephone call-back to the person or persons designated on Schedule V hereto,
and the Escrow Agent may rely upon the confirmations of anyone purporting to be the person or persons so designated. The persons and telephone numbers for call-backs may be changed only in a writing actually received and acknowledged by the Escrow
Agent. The Escrow Parties acknowledge that such security procedure is commercially reasonable. 
  
 (b) It is understood that the Escrow Agent and the beneficiary’s bank in any funds transfer may rely solely upon any account numbers
or similar identifying number provided by such beneficiary to identify (i) the beneficiary, (ii) the beneficiary bank or (iii) an intermediary bank. The Escrow Agent may apply any of the applicable escrowed funds for any payment order it executes
using any such identifying number, even where its use may result in a person other than the beneficiary being paid, or the transfer of funds to a bank other than the beneficiary’s bank or an intermediary bank designated. 
  
 19. Force Majeure. In the event that the Escrow Agent is unable to
perform its obligations under the terms of this Agreement because of acts of God, strikes, equipment or transmission failure or damage reasonably beyond its control or other cause reasonably beyond its control, the Escrow Agent shall not be liable
for damages to the other parties for any unforeseeable damages resulting from such failure to perform or otherwise from such causes. In such event, performance by the Escrow Agent under this Agreement shall resume when the Escrow Agent is able to
perform substantially its duties. 
  
 [Signature page follows.]

  

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 IN WITNESS WHEREOF, the parties hereto have duly executed this Agreement as of the date first written above. 

 

			
	THE COMPANY:
	  
 INTERNET CAPITAL
GROUP, INC.

		
	By:	 	 
	 	 	

	 Name:
	 	 
	 Title:
	 	 
	 	 	 
	ESCROW AGENT:
	  
 JPMORGAN CHASE
BANK

		
	By:	 	 
	 	 	

	 Name:
	 	 
	 Title:
	 	 
	 	 	 
	BUYERS:
	  
 BEAR STEARNS SECURITIES CORP. CUSTODIAN FOR JEFFREY THORP
IRA ROLLOVER

		
	By:	 	 
	 	 	

	 Name:
	 	 Jeffrey Thorp

	 	 	 
	COHANZICK ABSOLUTE RETURN MASTER FUND, LTD.
		
	By:	 	 
	 	 	

	 Name:
	 	 David K. Sherman

	 Title:
	 	 Authorized Agent

	 	 	 
	COHANZICK CREDIT OPPORTUNITIES FUND, LTD.
		
	By:	 	 
	 	 	

	 Name:
	 	 David K. Sherman

	 Title:
	 	 Authorized Agent


  










			
	 COHANZICK HIGH YIELD PARTNERS, L.P.

		
	By:	 	 
	 	 	

	 Name:
	 	 David K. Sherman

	 Title:
	 	 Authorized Agent

	 	 	 
	 GABRIEL CAPITAL, L.P.

		
	By:	 	 
	 	 	

	 Name:
	 	 David K. Sherman

	 Title:
	 	 Authorized Agent

	 	 	 
	 JMB CAPITAL PARTNERS, LP

		
	By:	 	 
	 	 	

	 Name:
	 	 
	 Title:
	 	 
	 	 	 
	 JMG CAPITAL PARTNERS, LP

		
	By:	 	 
	 	 	

	 Name:
	 	 
	 Title:
	 	 
	 	 	 
	 JMG TRTION OFFSHORE FUND, LTD

		
	By:	 	 
	 	 	

	 Name:
	 	 
	 Title:
	 	 

  










			
	 LANGLEY PARTNERS, L.P.

	
	 by: Langley Capital, LLC, its General Partner

		
	By:	 	 
	 	 	

	 Name:
	 	 Jeffrey Thorp

	 Title:
	 	 Managing Member

	 	 	 
	 MANCHESTER SECURITIES CORPORATION

		
	By:	 	 
	 	 	

	 	 	 Name:

	 	 	 Title:

	 	 	 
	 MASON CAPITAL, LP
 MASON CAPITAL, LTD
 GUGGENHEIM PORTFOLIO COMPANY X, LLC

		
	 By:
	 	 Mason Capital Management LLC,
 Investment
Manager

		
	By:	 	 
	 	 	

	 	 	 Name: John C. Grizzetti

	 	 	 Title: Chief Financial Officer

	 	 	 
	 NORTHWOOD CAPITAL PARTNERS LP

		
	 By:
	 	NwCapital Management LP, its General Partner
		
	By:	 	 
	 	 	

	 	 	 Name:

	 	 	 Title:

	 	 	 
	PORTSIDE GROWTH AND OPPORTUNITY FUND
		
	By:	 	 
	 	 	

	 	 	 Name:

	 	 	 Title:


  










			
	 SCOGGIN CAPITAL MANAGEMENT, LP II

		
	 By:
	 	S&E Partners, LP, its general partner
		
	 By:
	 	Scoggin, Inc., its general partner
		
	By:	 	 
	 	 	

	 	 	 Name: Craig Effron

	 	 	 Title: President

	 	 	 
	 SCOGGIN INTERNATIONAL FUND, LTD.

		
	 By:
	 	Scoggin, LLC, its trading advisor
		
	By:	 	 
	 	 	

	 	 	 Name: Craig Effron

	 	 	 Title: Managing Member

	 	 	 
	 TOPAZ PARTNERS LP

		
	By:	 	 
	 	 	

	 Name:
	 	 
	 Title: