Exhibit 10.1
EXECUTION VERSION
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ASSET PURCHASE AGREEMENT
BY AND AMONG
R.S.A.C., INC.,
RELATIONSERVE MEDIA, INC.
AND
RELATIONSERVE ACCESS, INC.
DATED AS OF JUNE 5, 2006
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TABLE OF CONTENTS
PAGE
ARTICLE I
PURCHASE OF ASSETS.............................................................1
1.1 Purchase and Sale of Acquired Assets.........................1
1.2 Assumed Obligations..........................................1
1.3 Method of Conveyance.........................................2
1.4 Purchase Price...............................................2
1.5 Allocation of Purchase Price and Assumed Obligations.........2
1.6 Participation Right..........................................3
1.7 Defense of Claims............................................3
ARTICLE II
REPRESENTATIONS AND WARRANTIES OF PARENT AND THE SELLER........................4
2.1 Corporate Organization, Etc..................................4
2.2 Authorization, Etc...........................................4
2.3 Financial Statements.........................................5
2.4 Title and Related Matters....................................5
2.5 Tax Matters..................................................6
2.6 Parent Reports...............................................6
2.7 Exclusivity of Representations...............................6
ARTICLE III
REPRESENTATIONS AND WARRANTIES OF THE PURCHASER................................7
3.1 Corporate Organization, Etc..................................7
3.2 Authorization, Etc...........................................7
3.3 No Violation.................................................7
3.4 Brokers or Finders...........................................7
3.5 Financial and Regulatory Matters.............................7
3.6 Purchaser's Business Decision................................8
ARTICLE IV
COVENANTS OF THE SELLER AND PARENT.............................................8
4.1 Regular Course of Business...................................8
4.2 Capital and Other Expenditures...............................9
4.3 Borrowing....................................................9
4.4 Other Commitments............................................9
4.5 Fulfillment of Conditions Precedent..........................9
4.6 Confidentiality..............................................9
4.7 Assistance...................................................9
ARTICLE V
COVENANTS OF THE PURCHASER.....................................................9
5.1 Confidentiality.............................................10
5.2 Assistance..................................................10
ARTICLE VI
OTHER AGREEMENTS..............................................................10
6.1 Agreement to Defend.........................................10
6.2 No Solicitation or Negotiation..............................10
6.3 No Termination of the Seller's or Parent's Obligations by
Subsequent Incapacity,
Dissolution, Etc............................................11
6.4 Deliveries After Closing....................................11
6.5 Public Announcements........................................11
6.6 Deposit.....................................................11
6.7 Employee Matters............................................11
6.8 Leased Premises.............................................13
ARTICLE VII
CONDITIONS TO THE OBLIGATIONS OF THE PURCHASER................................13
7.1 Representations and Warranties; Performance.................13
7.2 Consents and Approvals......................................13
7.3 No Proceeding or Litigation.................................14
7.4 Condition of Assets.........................................14
7.5 Due Diligence...............................................14
7.6 Release of Liens............................................14
7.7 Closing Deliveries..........................................14
7.8 Financial Statements........................................14
ARTICLE VIII
CONDITIONS TO THE OBLIGATIONS OF THE SELLER AND PARENT.......................14
8.1 Representations and Warranties; Performance.................14
8.2 Consents and Approvals......................................15
8.3 No Proceeding or Litigation.................................15
ARTICLE IX
CLOSING......................................................................15
9.1 Closing....................................................15
ARTICLE X
TERMINATION AND ABANDONMENT...................................................16
10.1 Methods of Termination......................................16
10.2 Procedure Upon Termination..................................16
ARTICLE XI
MISCELLANEOUS PROVISIONS......................................................17
11.1 Amendment and Modification..................................17
11.2 Waiver of Compliance; Consents..............................17
11.3 Certain Definitions.........................................17
11.4 Notices.....................................................21
11.5 Assignment..................................................23
11.6 Governing Law...............................................23
11.7 Counterparts................................................23
11.8 Headings....................................................23
11.9 Entire Agreement............................................23
11.10 Injunctive Relief...........................................23
11.11 Delays or Omissions.........................................24
11.12 Severability................................................24
11.13 Expenses....................................................24
11.14 No Third Party Beneficiaries................................24
11.15 No Strict Construction......................................24
11.16 Waiver of Jury Trial........................................24
11.17 Dispute Resolution..........................................25
This ASSET PURCHASE AGREEMENT (this "AGREEMENT"), dated as of the 6th
day of June, 2006, by and among R.S.A.C., Inc., a Delaware corporation (the
"PURCHASER"), RelationServe Access, Inc., a Delaware corporation (the "SELLER")
and RelationServe Media, Inc., a Delaware corporation and Parent of the Seller
("PARENT"). Terms used herein and not otherwise defined shall have the meanings
set forth in Section 11.3 hereof.
R E C I T A L S:
- - - - - - - -
WHEREAS, this Agreement is entered into to enable the Purchaser to
acquire all of the assets used by or in connection with Seller's internet
marketing business (the "BUSINESS");
NOW, THEREFORE, in consideration of the representations and warranties,
covenants and agreements, and subject to the conditions contained herein, the
Seller, Parent and the Purchaser hereby agree as follows:
ARTICLE I
PURCHASE OF ASSETS
1.1 PURCHASE AND SALE OF ACQUIRED ASSETS. Subject to the terms and
conditions of this Agreement, the Seller agrees to sell, assign, convey and
transfer to the Purchaser, and the Purchaser agrees to purchase from the Seller,
at the Closing, all of the goodwill and all of the assets used by or in
connection with the Business, wherever located, including, but not limited to,
the current inventory, machinery, fixtures and equipment, Intellectual Property,
Contracts, books and records, rights to retain payments under accounts
receivable (but not the right to commence any action or other legal proceeding,
or to threaten to take such action, without prior written notice to Seller)
rights to all of the Seller's Claims against third parties (but not the right to
commence any action or other legal proceeding, or to threaten to take such
action, without the prior written notice to Seller), unless by way of
indemnification for any Claims brought by any third parties (with the exception
of any Claims arising out of the Excluded Assets or Excluded Liabilities),
prepaid expenses, customer lists, Intellectual Property, permits and licenses
and other intangibles, telephones, computers, financial records, bookkeeping and
accounting records and systems (subject to any equipment leases as set forth in
the May Financial Statements (as hereinafter defined) (the "ACQUIRED ASSETS"),
except for the assets specifically set forth on SCHEDULE 1.1 hereto (the
"EXCLUDED ASSETS").
1.2 ASSUMED OBLIGATIONS. At Closing, the Purchaser shall (i) assume and
agree to perform all obligations of Seller under the Contracts entered into on
or prior to the Closing Date (other than as set forth on SCHEDULE 1.2(B)) (the
"ASSUMED OBLIGATIONS"); and (ii) assume, pay, and discharge the monetary
obligations related to the liabilities of Seller set forth in the May Financial
Statements (the "POST-CLOSING LIABILITIES") (with Purchaser's assumption of such
Post-Closing Liabilities to survive the Closing), excluding, in each case, all
Excluded Liabilities, up to an aggregate of Three Million Dollars ($3,000,000)
(the "STATED AMOUNT"); provided, that in no event shall the Purchaser be
responsible for the Post-Closing Liabilities set forth on SCHEDULE 1.2(A) in
excess of the individual amounts set forth thereon. The May Financial Statements
shall be delivered not less than one (1) business day prior to Closing and shall
be acceptable to Purchaser. Each of the Contracts assumed hereunder is
independently assumed subject to the representations, warranties (including that
such Contract is not in default on the Closing Date), covenants and conditions,
if any, made herein as to that Contract. Except as otherwise provided herein,
the Purchaser shall not assume or otherwise be responsible at any time for any
liability, obligation, debt or commitment of the Seller, whether absolute or
contingent, accrued or unaccrued, asserted or unasserted, or otherwise,
including, but not limited to, any liabilities, obligations, debts or
commitments of the Seller (a) incident to, arising out of or incurred with
respect to this Agreement and the transactions contemplated hereby, (b) for
outstanding checks and other similar obligations (unless related to the Business
and Acquired Assets, but subject to the Stated Amount limit), (c) relating to
the employee benefit plans, employee policies, employee Contracts, employee
programs and/or arrangements of the Seller or any of their Subsidiaries and
Affiliates with employees (including, but not limited to, any severance or bonus
payments payable to any employee of the Seller), (d) relating to Taxes with
respect to the Acquired Assets or the Business relating to all Pre-Closing
Periods and all taxes imposed on the Seller for all periods or (e) otherwise set
forth on SCHEDULE 1.2(B) hereto (collectively, the "EXCLUDED LIABILITIES").
Parent and the Seller shall be under no obligation to Purchaser (but may be
under obligations to third parties) to satisfy and discharge any obligation of
Parent or the Seller that may arise or be asserted against Parent or the Seller
under any of the Excluded Liabilities, but agree, jointly and severally, to
satisfy and discharge each of the Excluded Liabilities as the same may be
asserted against Purchaser to the extent any such Excluded Liability shall
become a Claim that is asserted against Purchaser, other than Excluded
Liabilities that are disputed in good faith by Seller or Parent. Any dispute
between the parties hereto with respect to the obligations of Parent or Seller
to Purchaser shall be settled in accordance with Section 11.17 hereof. The
Purchaser's assumption of the Assumed Obligations shall in no way create or
expand the rights or remedies of third parties against the Purchaser as compared
to the rights and remedies which such parties would have had against the Seller
or Parent had this Agreement not been consummated.
1.3 METHOD OF CONVEYANCE. The sale, transfer, conveyance and assignment
by the Seller of the Acquired Assets to the Purchaser in accordance with Section
1.1 hereof shall be effected on the Closing Date at the Closing by the Seller's
execution and delivery to the Purchaser of instruments of transfer including:
(a) the ▇▇▇▇ of sale in substantially the form of EXHIBIT 1.3(A) attached
hereto, (b) assignments of patents and trademarks for the patents and trademarks
included among the Business' Intellectual Property substantially in the form of
EXHIBIT 1.3(B) attached hereto, and (c) consents to the assignment of Contracts
by third parties thereto in the form of EXHIBIT 1.3(C). On the Closing Date, all
of the Acquired Assets shall be transferred by the Seller to the Purchaser free
and clear of any and all Liens, Claims and Orders.
1.4 PURCHASE PRICE. In consideration for the conveyance of the Acquired
Assets, and in reliance on the representations and warranties, covenants and
agreements of the Seller contained herein and the documents contemplated hereby,
at Closing the Purchaser (i) agrees to assume and agrees to pay, satisfy,
perform and discharge its obligations set forth in Section 1.2, and (ii) shall
pay to the Seller an aggregate cash amount equal to One Million Four Hundred
Thousand Dollars ($1,400,000.00) (the "PURCHASE PRICE").
1.5 ALLOCATION OF PURCHASE PRICE AND ASSUMED OBLIGATIONS. The Seller,
Parent, and the Purchaser agree to allocate the aggregate Purchase Price to be
paid for the Acquired Assets and the Assumed Obligations in accordance with
Section 1060
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of the Code. The Seller, Parent, and the Purchaser agree that the Purchaser
shall prepare and provide to the Seller a draft allocation of the Purchase Price
among the Acquired Assets within seven (7) business days following to the
Closing Date. The Seller shall notify the Purchaser within two (2) business days
of receipt of such draft allocation of any objection the Seller may have
thereto. The Seller and the Purchaser agree to resolve any disagreement with
respect to such allocation in good faith. In addition, the Seller and the
Purchaser hereby undertake and agree to file timely any information that may be
required to be filed pursuant to Treasury Regulations promulgated under Section
1060(b) of the Code, and shall use the allocation determined pursuant to this
Section 1.5 in connection with the preparation of Internal Revenue Service Form
8594 as such form relates to the transactions contemplated by this Agreement.
Neither the Seller nor the Purchaser shall file any Tax Return or other document
or otherwise take any position which is inconsistent with the allocation
determined pursuant to this Section 1.5 except as may be adjusted by subsequent
agreement following an audit by the IRS or by court decision.
1.6 PARTICIPATION RIGHT. Seller shall have the right to receive notice
of all Claims and correspondence and, at its sole expense, to defend (in the
event the Purchaser does not retain counsel in connection with any Claim) or
participate in the defense of any Claims asserted against Purchaser related to
the Assumed Obligations (only with respect Claims under the Seller's Contracts
relating to actions arising prior to the Closing Date) and the Post-Closing
Liabilities (the "POST-CLOSING LIABILITY CLAIMS") until the later of the
definitive resolution of such Post-Closing Liability Claims without right of
appeal, or the running of any statute of limitations with respect to such
Post-Closing Liability Claims. Purchaser shall use its reasonable best efforts
to assure that the amount of settlement or resolution of any of the Post-Closing
Liability Claims does not exceed the amounts set forth in the May Financial
Statements, individually or collectively, or as appears in the books, accounts
and records of Seller on the Closing Date and to provide that the aggregate
dollar amount of liabilities incurred in connection with such Post-Closing
Liability Claims shall not exceed the Stated Amount unless Seller has had the
opportunity to participate in such actions. Purchaser shall provide prompt
written notice to Seller in the event that Purchaser at any time receives any
Claim, notice, demand, or other communication concerning any Post-Closing
Liability Claims or determines that it may be obligated to incur any obligation
which individually, or collectively, could result in Assumed Obligations in
excess of the Stated Amount, or the amounts set forth on SCHEDULE 1.2(A). Seller
shall have the right to participate in the defense of such action, including the
employment of counsel (satisfactory to Purchaser) and, if Seller shall elect to
do so, Seller shall pay all fees and expenses of its counsel and be entitled to
retain any recovery a result thereof in connection with any counterclaims or
cross claims that have been asserted by Seller. Notwithstanding anything herein
to the contrary, Seller shall not be liable for any settlement of any Claim
resulting in a liability being assessed against the Parent, Seller, or Purchaser
in excess of the Stated Amount effected without Seller's written consent.
1.7 DEFENSE OF CLAIMS. Purchaser covenants and agrees that prior to
asserting any Claims against third parties based upon any accounts receivables
or Contracts included among the Acquired Assets that could result in any Claim
or liability being asserted against Parent, Seller, or Purchaser in excess of
the Stated Amount or the amounts set forth on SCHEDULE 1.2(A), or arising from
any actions or activities on or prior to the Closing, that it shall notify the
Seller, and the Seller shall have the right to participate in such proceedings,
at its sole expense. Purchaser acknowledges and agrees that neither Seller nor
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Parent has made any representation or warranty as to the amount or
collectability of any receivables or other cash equivalent assets set forth in
the March Financial Statements.
ARTICLE II
REPRESENTATIONS AND WARRANTIES OF PARENT AND THE SELLER
Each of the Seller and Parent, jointly and severally represents and
warrants to the Purchaser as of the date hereof and as of the Closing Date:
2.1 CORPORATE ORGANIZATION, ETC. The Seller is a corporation duly
incorporated, validly existing and in good standing under the laws of the State
of Delaware with full corporate power and authority to carry on its business as
it is now being conducted and to own, operate and lease its properties and
assets. The Seller is duly qualified or licensed to do business and is in
corporate and Tax good standing in every jurisdiction in which the conduct of
its business, the ownership or lease of its properties, require it to be so
qualified or licensed.
2.2 AUTHORIZATION, ETC.
(a) The Seller has full power and authority to enter into this
Agreement and the agreements contemplated hereby to which the Seller is
a party and to consummate the transactions contemplated hereby and
thereby. This Agreement and all other agreements contemplated hereby to
be entered into by the Seller each constitutes a legal, valid and
binding obligation of the Seller enforceable against the Seller in
accordance with its terms, except to the extent that such
enforceability may be limited by bankruptcy, insolvency or other
similar laws related to creditor's rights generally and by general
principles of equity.
(b) Parent is the sole owner of and has full right, power and
authority to vote the shares of capital stock of the Seller held by it.
Parent has full power and authority to enter into this Agreement and
the agreements contemplated hereby. This Agreement and all other
agreements contemplated hereby to be entered into by Parent each
constitute a legal, valid and binding obligation of Parent enforceable
against Parent in accordance with its terms, except to the extent that
such enforceability may be limited by bankruptcy, insolvency or other
similar laws related to creditor's rights generally and by general
principles of equity.
(c) Except as pursuant to the terms of (i) that certain Securities
Purchase Agreement dated as of October 31, 2005 by and among SendTec
Acquisition Corp. ("STAC"), a Delaware corporation, Parent, and the
purchasers set forth on the signature pages thereto (the "SECURITIES
PURCHASE AGREEMENT") and (ii) each of those certain Senior Secured
Convertible Debentures due October 30, 2009 issued by STAC to the
purchasers under the Securities Purchase Agreement (the "DEBENTURES"),
the execution, delivery and performance by Parent and the Seller of
this Agreement, and all other agreements contemplated hereby, and the
fulfillment of and compliance with the respective terms hereof and
thereof by Parent and the Seller, do not and will not (i) conflict with
or result in a breach of the terms, conditions or provisions of,
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(ii) constitute a default or event of default under (whether with or
without due notice, the passage of time or both), (iii) result in the
creation of any Lien upon the Seller's assets pursuant to, (iv) give
any third party the right to modify, terminate or accelerate any
obligation under, (v) result in a violation of, or (vi) require any
authorization, consent, approval, exemption or other action by, notice
to, or filing with any third party or Authority, other than the SEC,
pursuant to, the Seller's charter or bylaws (or similar corporate
documents, including articles of formation and operating agreements) or
any applicable Regulation, Order or Contract to which the Seller,
Parent or their respective properties are subject. Each of Parent and
the Seller has complied with all applicable Regulations and Orders in
connection with the execution, delivery and performance of this
Agreement, the agreements contemplated hereby and the transactions
contemplated hereby and thereby.
2.3 FINANCIAL STATEMENTS. Prior to the date hereof, Parent and the
Seller have delivered to the Purchaser (i) unaudited balance sheets and (ii)
unaudited statements of income, stockholders' equity and cash flow specific to
the Seller as of March 31, 2006, as reflected in the books, records and accounts
of the Seller (the "MARCH FINANCIAL STATEMENTS"). Such March Financial
Statements are true, complete and accurate in all material respects, and fairly
present the results of operations for the periods referred to therein in
accordance with GAAP. March 31, 2006 is hereinafter referred to as the
"FINANCIAL STATEMENT DATE".
2.4 TITLE AND RELATED MATTERS.
(a) The Seller has, and shall continue to have, good and marketable
title to all real and personal, tangible and intangible, property and
other assets reflected in the Financial Statements or acquired after
the Financial Statement Date, including the Acquired Assets, free and
clear of all Liens, Claims and Orders except Permitted Liens. All
properties used by the Seller in the Business as of March 31, 2006 are
reflected in the March Financial Statements in accordance with and to
the extent required by GAAP, except as to those assets that are leased.
(b) None of the Acquired Assets is or will be on the Closing Date
subject to any (i) Contracts of sale or lease, except Contracts for the
sale of inventory in the ordinary and regular course of business or
(ii) Liens, except, as of the date hereof, for Permitted Liens.
(c) There has not been since the Financial Statement Date and will
not be prior to the Closing Date, any sale, lease, or any other
disposition or distribution by the Seller of any of the Acquired
Assets, now or hereafter owned by it, except as otherwise consented to
by the Purchaser. Immediately after the Closing, the Purchaser will
own, or have the unrestricted right, subject to the Seller's compliance
with any applicable SEC regulations governing the transactions
contemplated by this Agreement, to use, all properties and assets that
are used (or necessary) in connection with the Business on the same
economic basis as before the Closing.
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2.5 TAX MATTERS.
(a) The Seller has timely filed or caused to be timely filed with
the appropriate taxing authorities all tax returns, statements, forms
and reports (including elections, declarations, disclosures, schedules,
estimates and information Tax Returns) for Taxes (collectively, "TAX
RETURNS") that are required to be filed by, or with respect to, the
income or operations of the Business and the ownership of the Acquired
Assets on or prior to the Closing Date, and such Tax Returns are and
will be true, correct and complete in all material respects and have
been prepared in compliance with all applicable Regulations. All Taxes
that the Seller is (or was) required by law to withhold or collect in
connection with the income or operations of the Business and the
ownership of the Acquired Assets have been duly withheld or collected,
and all Taxes and Tax liabilities due by or with respect to the income
or operations of the Business and the ownership of the Acquired Assets
for all taxable years or other taxable periods that end on or before
the Closing Date and, with respect to any taxable year or other taxable
period beginning on or before and ending after the Closing Date, the
portion of such taxable year or period ending on and including the
Closing Date (each a "PRE-CLOSING PERIOD") have been timely paid or
will be timely paid in full on or prior to the Closing Date or accrued
and adequately disclosed and fully provided for in accordance with GAAP
on the Financial Statements and the Seller has no liability, absolute
or contingent, for the payment of any Tax under the Code or under the
laws of any state or locality.
(b) No Seller is a foreign person within the meaning of Treas. Reg.
1.1445-2(b)(2)(i).
2.6 PARENT REPORTS. (a) Since June 10, 2005, Parent (including any
predecessor entity) has filed all forms, reports, schedules, statements,
registration statements and other documents with the SEC relating to periods
commencing on or after such date required to be filed by it pursuant to the
federal securities Regulations and the SEC Regulations thereunder (such forms,
reports, schedules, statements, registration statements and other documents
filed by Parent after June 10, 2005 and prior to the date hereof being
hereinafter referred to as the "SEC FILINGS"), and, as of their respective
dates, the SEC Filings complied in all material respects with all applicable
requirements of the federal securities Laws and the SEC rules and regulations
promulgated thereunder. Except to the extent amended or superseded by a
subsequent filing with the SEC made prior to the date hereof, as of their
respective dates (and if so amended or superseded, then on the date of such
filing prior to the date hereof), the SEC Filings (including, without
limitation, any financial statements or schedules included therein) (i) did not
contain any untrue statement of a material fact or omit to state a material fact
required to be stated therein or necessary in order to make the statements
therein, in light of the circumstances under which they were made, not
misleading and (ii) complied in all material respects with the applicable
requirements of the Securities Exchange Act of 1934, as amended, and the
Securities Act of 1933, as amended, as the case may be, and the applicable rules
and regulations of the SEC thereunder.
2.7 EXCLUSIVITY OF REPRESENTATIONS. The representations and warranties
made by Seller or Parent in this Agreement are the sole representations and
warranties by Seller or Parent or their Affiliates, including, but not limited
to, any warranty or representation as to the condition or suitability of the
Acquired Assets, which are being conveyed on an "AS IS, WHERE IS" basis.
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ARTICLE III
REPRESENTATIONS AND WARRANTIES OF THE PURCHASER
The Purchaser represents and warrants to Parent as follows as of the
date hereof and as of the Closing Date:
3.1 CORPORATE ORGANIZATION, ETC. The Purchaser is a corporation duly
organized, validly existing and in good standing under the laws of the State of
Delaware with full corporate power and authority to carry on its business as it
is now being conducted and to own, operate and lease its properties and assets.
The Purchaser is duly qualified or licensed to do business and is in corporate
and Tax good standing in every jurisdiction in which the conduct of its
business, the ownership or lease of its properties, require it to be so
qualified or licensed.
3.2 AUTHORIZATION, ETC. The Purchaser has full power and authority to
enter into this Agreement and the agreements contemplated hereby to which the
Purchaser is a party and to consummate the transactions contemplated hereby and
thereby. The execution, delivery and performance of this Agreement and all other
agreements and transactions contemplated hereby have been duly authorized by all
corporate actions of the Purchaser and no other corporate proceedings on its
part are necessary to authorize this Agreement and the agreements contemplated
hereby and the transactions contemplated hereby and thereby. This Agreement and
all other agreements contemplated hereby to be entered into by the Purchaser
each constitutes a legal, valid and binding obligation of the Purchaser
enforceable against the Purchaser in accordance with its terms.
3.3 NO VIOLATION. The execution, delivery and performance by the
Purchaser of this Agreement, and all other agreements contemplated hereby, and
the fulfillment of and compliance with the respective terms hereof and thereof
by the Purchaser, do not and will not (a) conflict with or result in a breach of
the terms, conditions or provisions of, (b) constitute a default or event of
default under (whether with or without due notice, the passage of time or both),
(c) result in a violation of, or (d) require any authorization, consent,
approval, exemption or other action by, or notice to, or filing with any third
party or Authority pursuant to, the charter or bylaws of the Purchaser or any
applicable Regulation, Order or Contract to which the Purchaser or its
properties are subject. The Purchaser has complied with all applicable
Regulations and Orders in connection with its execution, delivery and
performance of this Agreement, the agreements contemplated hereby and the
transactions contemplated hereby and thereby.
3.4 BROKERS OR FINDERS. Purchaser has not incurred any obligation or
liability for brokerage or finders' fees or agents' commissions or other similar
payments in connection with this Agreement for which the Seller or Parent will
directly or indirectly have any liability.
3.5 FINANCIAL AND REGULATORY MATTERS. Purchaser has the financial
capacity to perform all of its obligations under this Agreement and does not
require bank financing to complete the transactions contemplated by this
Agreement.
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3.6 PURCHASER'S BUSINESS DECISION. Purchaser is familiar with the
Seller's business and its operations. Purchaser acknowledges that it has made
its decision to acquire the Acquired Assets based solely on its own business
review (which has assumed the truth and accuracy of any representations or
statements made by Parent, the Seller or their representatives) and the truth
and accuracy of the representations and warranties of Parent and the Seller set
forth in this Agreement. The Purchaser has not relied on any other
representations or statements, whether by third parties or otherwise.
ARTICLE IV
COVENANTS OF THE SELLER AND PARENT
Until the Closing Date, except as otherwise consented to or approved by
the Purchaser in writing, Parent the Seller agree that they shall act, or
refrain from acting where required hereinafter, to comply (and, in the case of
Parent, to cause the Seller to comply) with the following:
4.1 REGULAR COURSE OF BUSINESS. The Seller shall (a) not effect any
material transaction involving the Seller that is not consistent with its past
practices and operate its business diligently and in good faith, consistent with
past management practices and the Seller's current operating budget; (b)
maintain all of its properties in customary repair, order and condition,
reasonable wear and tear excepted; (c) maintain (except for expiration due to
lapse of time) all leases and Contracts in effect without change except as
expressly provided herein; (d) comply with the provisions of all Regulations and
Orders applicable to the Seller and the conduct of the Business; (e) not cancel,
release, waive or compromise any debt, Claim or right in its favor; (f) not make
capital expenditures outside the ordinary course of business, or in excess of
$25,000 in the aggregate; (g) maintain capital expenditures inventory, supplies
and spare parts at customary operating levels consistent with current practices,
and replace any inoperable, worn-out or obsolete assets with modern assets of
comparable quality, in accordance with past practice; (h) not engage in the
sale, transfer, assignment or other disposition of any of the Acquired Assets
(other than the replacement of any inoperable, worn-out or obsolete assets with
modern assets of comparable quality, in accordance with past practice); (i)
maintain its books, accounts and records in accordance with past custom and
practice as used in the preparation of the March Financial Statements; (j)
maintain in full force and effect the existence of all Intellectual Property
rights; (k) use its reasonable best efforts to preserve the goodwill and
organization of the Business and its relationships with its customers,
suppliers, employees and other Persons having business relations with it; (l)
not enter into, amend, supplement, replace or otherwise modify any Contract with
any Person, other than in the ordinary course of business and upon prior written
notice to the Purchaser; (m) (notwithstanding (l) above) not enter into, amend,
supplement, replace or otherwise modify any employment, consultant, or similar
Contract with any Person; (m) not take or omit to take any action that would
require disclosure under Article II, or that would otherwise result in a breach
of any of the representations, warranties or covenants made by the Seller in
this Agreement or in any of the agreements contemplated hereby; and (n) not take
any action or omit to take any action which act or omission would reasonably be
anticipated to have a Material Adverse Effect.
8
4.2 CAPITAL AND OTHER EXPENDITURES. The Seller shall not make any
Investments or commitments with respect thereto. The Seller shall not make any
loan or advance to any Person (other than accounts receivable made in the
ordinary course of business) and shall collect in full any amounts outstanding
now due from any Affiliate. The Seller shall not make any charitable or other
contributions to any Person nor shall they make any commitments therefore.
4.3 BORROWING. The Seller shall not incur, assume or Guarantee any
Indebtedness not reflected on the March Financial Statements or in the SEC
Filings.
4.4 OTHER COMMITMENTS. Except as set forth in this Agreement, incurred
or transacted in the ordinary course of business, or permitted in writing by the
Purchaser, the Seller shall not enter into any material Contract or transaction
or make any commitment or incur any material obligation or liability (including
entering into any real property leases).
4.5 FULFILLMENT OF CONDITIONS PRECEDENT. The Seller and Parent shall
use their respective best efforts to obtain at their commercially reasonable
expense (but with respect to the Debentures shall not be obligated to incur any
commercially unreasonable cost or expense, issue any equity, adjust any rights,
or satisfy any Claims other than as Parent, in its sole and absolute discretion,
may determine) all such Lien releases, waivers, Permits, consents, approvals or
other authorizations from third Persons and Authorities, and to do all things as
may be necessary or desirable in connection with transactions contemplated by
this Agreement.
4.6 CONFIDENTIALITY. Except as may otherwise be required by law or
lawful order of an Authority of competent jurisdiction, the Seller agrees to
keep secret and confidential, after the Closing, all non-public information
concerning the Business, the Purchaser or any of its Affiliates that was
acquired by, or disclosed to, the Seller prior to the Closing Date, except any
of the same that (a) was, is now, or becomes generally available to the public
(but not as a result of a breach of any duty of confidentiality by which the
Seller and its Affiliates are bound); (b) was disclosed to the Seller by a third
party not subject to any duty of confidentiality to the Business, the Purchaser
or any of its Affiliates prior to its disclosure to the Seller by the Purchaser
or any of its Affiliates; and (c) is disclosed by the Seller in the ordinary
course of business in connection with communications with customers, vendors and
other proper parties, provided that it is for a proper purpose solely for the
benefit of the Business, the Purchaser or any of its Affiliates.
4.7 ASSISTANCE. Parent, Seller and Purchaser shall each provide each
other with such assistance as may be reasonably requested (including making
employees reasonably available to provide information or testimony) in
connection with the preparation of any tax return, SEC filing or report, or
other regulatory matter, or the determination of liability for taxes with
respect to the Acquired Assets or the income or operations of the Business as
contemplated by this Agreement.
ARTICLE V
COVENANTS OF THE PURCHASER
The Purchaser hereby covenants and agrees with the Seller and Parent
that:
9
5.1 CONFIDENTIALITY. Except as may otherwise be required by law or
lawful Order of an Authority of competent jurisdiction, the Purchaser agrees
that unless and until the transactions contemplated hereby have been
consummated, the Purchaser and its representatives and its Affiliates and their
representatives and advisors will hold in strict confidence all data and
information obtained from the Seller in connection with the transactions
contemplated hereby, except any of the same which (a) was, is now, or becomes
generally available to the public (but not as a result of a breach of any duty
of confidentiality by which the Purchaser and its representatives and advisors
are bound); (b) was known to the Purchaser prior to its disclosure to the
Purchaser as demonstrated by Purchaser's written records; or (c) is disclosed to
the Purchaser by a third party not subject to any duty of confidentiality to the
Seller prior to its disclosure to the Purchaser by the Seller. The Purchaser
will use such data and information solely for the specific purpose of evaluating
the transactions contemplated hereby.
5.2 ASSISTANCE. Parent, Seller and Purchaser shall each provide each
other with such assistance as may be reasonably requested (including making
employees reasonably available to provide information or testimony) in
connection with the preparation of any tax return, SEC filing or report, or
other regulatory matter, or the determination of liability for taxes with
respect to the Acquired Assets or the income or operations of the Business as
contemplated by this Agreement.
ARTICLE VI
OTHER AGREEMENTS
The parties further agree as follows:
6.1 AGREEMENT TO DEFEND. In the event any action, suit, proceeding or
investigation of the nature specified in Section 7.3 or Section 8.3 hereof is
commenced, whether before or after the Closing Date, all the parties hereto
agree to cooperate and use their best efforts to defend against and respond
thereto.
6.2 NO SOLICITATION OR NEGOTIATION. The Seller shall not, and the
Seller shall use its best efforts to ensure that its members, stockholders, and
any of its and its stockholders' or members' Affiliates, representatives,
officers, employees, directors, managers or agents shall not, directly or
indirectly (a) submit, solicit, initiate, encourage or discuss any proposal or
offer from any Person or enter into any Contract or accept any offer relating to
or to consummate any (i) reorganization, liquidation, dissolution or
recapitalization of the Seller; (ii) merger or consolidation involving the
Seller; (iii) purchase or sale of any of the assets or capital stock, Options,
stock appreciation rights, phantom stock options or other similar equity based
participations (or any rights to acquire, or securities convertible into or
exchangeable for, any shares of such capital stock, Options, stock appreciation
rights, phantom stock options or other such securities) of the Seller (other
than a purchase or sale of inventory and worn-out or obsolete assets in the
ordinary course of business consistent with past custom and practice and in
accordance with the terms of this Agreement); (iv) similar transaction or
business combination involving the Seller or its assets; or (v) acquisition by
the Seller of other businesses, whether by the purchase of assets or capital
stock of another Person; or (b) furnish any information with respect to, assist
or participate in or facilitate in any other manner any effort or attempt by any
10
Person to do or seek to do any of the foregoing; provided however, nothing
herein shall limit or restrict in any way the Seller from communicating with its
legal, accounting and other professional advisors or lenders for the purpose of
facilitating the transactions contemplated by this Agreement. The Seller shall
notify the Purchaser immediately if any Person makes any proposal, offer,
inquiry or contact to the Seller or, to the Seller's knowledge, any other Person
for the purpose of effectuating one or more of the foregoing transactions.
6.3 NO TERMINATION OF THE SELLER'S OR PARENT'S OBLIGATIONS BY
SUBSEQUENT INCAPACITY, DISSOLUTION, ETC. The Seller and Parent hereby agree that
their obligations pursuant to this Agreement shall not be terminated by the
death or incapacity of Parent, the dissolution of the Seller, by operation of
law or otherwise
6.4 DELIVERIES AFTER CLOSING. From time to time after the Closing, at
the other party's request and without further consideration, Parent and/or the
Seller and/or Purchaser shall execute and deliver such other instruments of
conveyance and transfer and take such other action as the other party reasonably
may require to convey, transfer to and vest in the Purchaser and to put the
Purchaser in possession of any rights or property to be sold, conveyed,
transferred and delivered hereunder and to effectuate the intents and purposes
of this Agreement.
6.5 PUBLIC ANNOUNCEMENTS. Except as otherwise required by law, neither
Parent, the Seller, nor any Affiliate, representative or stockholder of such
Persons, shall disclose any of the terms of this Agreement to any third party
without the other party's prior written consent. The form, content and timing of
all press releases, public announcements or publicity statements with respect to
this Agreement and transactions contemplated hereby shall be subject to the
prior approval of both the Seller and the Purchaser, which approval shall not be
unreasonably withheld. No press releases, public announcements or publicity
statements shall be released by either party without such prior mutual
agreement.
6.6 DEPOSIT. In the event of (i) the successful consummation of the
transactions contemplated hereby (which would include the payment of the
purchase price to Seller set forth in Section 1.4), or (ii) a termination of
this Agreement in accordance with Article X hereto (other than in the event of a
breach of this Agreement by the Purchaser in bad faith), Parent or Seller shall
return to the Purchaser (or an Affiliate designated by Purchaser) the $25,000
deposit delivered by the Purchaser and/or its Affiliates to counsel to Seller on
or about the date hereof within three (3) business days of the Termination Date
or the Closing Date, as applicable.
6.7 EMPLOYEE MATTERS.
(a) On or about the Closing Date, the Purchaser shall offer
"at-will" employment to all employees of the Business in existence as of the
date hereof (each, a "SELLER EMPLOYEE") (but, in the case of any Seller Employee
who is on long-term leave (including, but not limited to, long-term disability
leave), the Purchaser shall offer employment to such Seller Employee promptly
upon the conclusion of such leave, with such employment to commence as soon as
practicable thereafter), upon such terms and conditions as the Purchaser may
determine (and in the case of each of Messrs. ▇▇▇▇▇ ▇▇▇▇▇▇▇▇ and ▇▇▇▇ ▇▇▇▇▇▇▇,
upon terms to be mutually agreed upon by the Purchaser and each of ▇▇. ▇▇▇▇▇▇▇▇
and ▇▇. ▇▇▇▇▇▇▇, respectively), and the employment by the Seller of any such
Seller Employee who shall have accepted such offer of employment (each, a
11
"TRANSFERRED EMPLOYEE", and collectively, the "TRANSFERRED EMPLOYEES") shall
concurrently terminate. Nothing in this Agreement, express or implied, shall:
(i) confer upon any Transferred Employee, or any representative of any such
Transferred Employee, any rights or remedies, including any right of continued
employment for any period or terms of employment, for any nature whatsoever, or
(ii) be interpreted to prevent or restrict the Purchaser or its Affiliates from
modifying or terminating the employment or terms of employment of any
Transferred Employee.
(b) Parent and the Seller shall permit the Purchaser to contact and
make arrangements with the Seller Employees regarding employment or prospective
employment by the Purchaser after the Closing and for the purpose of ensuring
the continuity of the Business, and each of Parent and the Seller agrees not to
discourage, and to cause their Affiliates not to discourage, any such Seller
Employees from consulting with the Purchaser. Each of Parent and the Seller
shall make available to the Purchaser such personnel and similar information as
the Purchaser may request with respect to any Seller Employee, including
compensation and employment records. Each of Parent and the Seller shall use its
best efforts to keep available the services of the Seller Employees through the
Closing Date.
(c) The Purchaser hereby agrees to make payment on behalf of the
Seller for any severance pay (which, for the sake of clarity, shall not include
any accrued, but unpaid salary); accrued and unpaid commissions; accrued and
unpaid, unused vacation; or sick or holiday pay, due to any Seller Employee;
provided, that such liabilities have been accrued for on the May Financial
Statements; and provided, further that such payments shall be applied towards,
and shall not exceed in the aggregate, the Stated Amount.
(d) The parties acknowledge that the transactions provided for in
this Agreement may result in obligations on the part of the Seller and one or
more of the Employee Benefit Plans that is an employee welfare benefit plan
(within the meaning of Section 3(1) of ERISA) to comply with the health care
continuation requirements of Section 4980B of the Code and part 6 of subtitle B
of Title I of ERISA (such provisions of the Code and ERISA collectively referred
to as "COBRA") or state law, as applicable. The parties expressly agree that the
Purchaser and the Purchaser's benefit plans shall have no responsibility for
compliance with such health care continuation requirements (i) for qualified
beneficiaries who previously elected to receive continuation coverage under the
Employee Benefit Plans or who between the date of this Agreement and the Closing
Date elect to receive continuation coverage, or (ii) with respect to those
employees or former employees of the Seller who may become eligible to receive
such continuation coverage on or prior to the Closing Date or in connection with
the transactions provided for in this Agreement. Parent and the Seller shall be
solely responsible for compliance with COBRA, including, without limitation, the
provision of continuation coverage (within the meaning of COBRA), with respect
to all employees and former employees of the Business, and their respective
spouses and dependents, for whom a qualifying event (within the meaning of
COBRA) occurs at any time prior to or on the Closing Date.
(e) Other than as expressly set forth in this Section 6.7, the
Purchaser shall not be responsible for any other liabilities associated with
Seller's employment of the Seller Employees, whether under existing Contracts
with such Seller Employees or otherwise. Notwithstanding anything in this
Agreement to the contrary, except as specifically set forth in this Agreement:
12
(i) the Purchaser shall not be obligated to assume, continue or maintain any of
the Employee Benefit Plans, and (ii) no assets or liabilities of the Employee
Benefit Plans shall be transferred to, or assumed by, the Purchaser or the
Purchaser's benefit plans.
6.8 LEASED PREMISES. Parent and the Seller hereby consent (to the
extent that they can provide such consent, given Purchaser's acknowledgement
that such consent is not binding on either Landlord or OmniPoint) that the
Purchaser shall be permitted, at its sole election, to maintain operations on
the premises that are the subject of that certain Office Lease for Cypress Park
West Office Building, effective as of October 1, 2003, by and between Savannah
Teachers Properties, Inc. (the "LANDLORD") and Omni Point Marketing, LLC, a
Florida limited liability company ("OMNIPOINT"), for a period of up to three (3)
months following the Closing Date; provided, that the Purchaser shall be
responsible for all rents payable for any post-Closing periods during which the
Purchaser occupies the premises, and provided, further, that Purchaser
acknowledges that (i) neither Landlord nor OmniPoint has agreed to any continued
period of occupancy, (ii) Landlord has notified OmniPoint it is in payment
default (which default payments shall not be the responsibility of Purchaser and
solely be the responsibility of OmniPoint or, to the extent that Landlord
successfully asserts any Claim against such parties, of Parent and the Seller),
and (iii) the Landlord may take action to enforce the lease or recover the
premises.
ARTICLE VII
CONDITIONS TO THE OBLIGATIONS OF THE PURCHASER
Each and every obligation of the Purchaser under this Agreement shall
be subject to the satisfaction, on or before the Closing Date, of each of the
following conditions, unless waived in writing by the Purchaser:
7.1 REPRESENTATIONS AND WARRANTIES; PERFORMANCE. The representations
and warranties of the Seller and Parent contained in Article II and elsewhere in
this Agreement and all information contained in any exhibit or schedule hereto
delivered by, or on behalf of, the Seller or Parent, to the Purchaser, shall be
true and correct when made and on the Closing Date as though then made, except
as expressly provided herein. The Seller and Parent shall have performed and
complied with all material agreements, covenants and conditions required by this
Agreement to be performed and complied with by them prior to the Closing Date.
7.2 CONSENTS AND APPROVALS. The Seller, Purchaser and Parent shall have
obtained any and all consents, approvals, Orders, Permits or other
authorizations, required by all applicable Regulations, Orders and Contracts
involving the Seller or binding on their properties and assets, with respect to
the execution, delivery and performance of the Agreement, the agreements
contemplated hereby, the consummation of the transactions contemplated herein,
and the conduct of the business of the Seller in the same manner after the
Closing Date as before the Closing Date, including, but not limited to, any and
all consents, waivers and/or approval required pursuant to the terms of the
Securities Purchase Agreement and the Debentures, and any required consents and
approvals from the board of directors of Come & Stay S.A., a company organized
under the laws of France and parent to the Purchaser.
13
7.3 NO PROCEEDING OR LITIGATION. No preliminary or permanent injunction
or other Order issued by a court of competent jurisdiction or by any Authority,
or any Regulation or Order promulgated or enacted by any Authority shall be in
effect which could reasonably be expected to (i) make illegal, or to delay or
otherwise directly or indirectly restrain or prohibit, the consummation of the
transactions contemplated by this Agreement, or result in damages in connection
with the transactions contemplated by this Agreement, (ii) result in (x) the
prohibition of ownership or the operation by the Purchaser of all or a portion
of the Acquired Assets or (y) the compelling of the Purchaser to dispose of or
to hold separately any portion of the business or assets of the Purchaser or its
Affiliates or subsidiaries as a result of the transactions contemplated by this
Agreement or (iii) result in any diminution in the benefits expected to be
derived by the Purchaser as a result of the transactions contemplated by this
Agreement.
7.4 CONDITION OF ASSETS. The Acquired Assets shall not have been
damaged or destroyed, prior to the Closing Date, by fire or other casualty,
whether or not fully covered by insurance.
7.5 DUE DILIGENCE. The Purchaser shall be satisfied with its inspection
of the Acquired Assets and the Seller's maintenance records, and its legal,
business, and financial due diligence investigation of the Seller and the
Business.
7.6 RELEASE OF LIENS. The Seller and Christiana Bank & Trust Company
shall have delivered to White & Case LLP or ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇ Frome ▇▇▇▇▇▇▇▇▇▇ &
Wolosky LLP any and all documents and instruments necessary to release any Liens
on the Acquired Assets, including properly-prepared UCC-3 termination
statements, which documents and instruments shall have been made available for
Purchaser's inspection prior to the Closing Date.
7.7 CLOSING DELIVERIES. The Seller shall have executed and delivered to
the Purchaser all documents and instruments of sale, transfer, conveyance and
assignment set forth in Section 1.3 hereto.
7.8 FINANCIAL STATEMENTS. The Seller shall have delivered to the
Purchaser monthly (i) unaudited balance sheets and (ii) unaudited statements of
income, stockholders' equity and cash flow, each specific to the Seller, for the
two (2) month period ended May 31, 2006 (collectively, the "MAY FINANCIAL
STATEMENTS"), which financial statements shall be acceptable to the Purchaser.
ARTICLE VIII
CONDITIONS TO THE OBLIGATIONS OF
THE SELLER AND PARENT
Each and every obligation of the Seller and Parent under this Agreement
shall be subject to the satisfaction, on or before the Closing Date, of each of
the following conditions unless waived in writing by Parent:
8.1 REPRESENTATIONS AND WARRANTIES; PERFORMANCE. The representations
and warranties of the Purchaser contained in Article III and elsewhere in this
14
Agreement and all information contained in any exhibit or schedule hereto
delivered by, or on behalf of, the Purchaser to the Seller and Parent, shall be
true and correct when made and on the Closing Date as though then made, except
as expressly provided herein. The Purchaser shall have performed and complied
with all agreements, covenants and conditions required by this Agreement to be
performed and complied with by it prior to the Closing Date.
8.2 CONSENTS AND APPROVALS. The Purchaser shall have obtained any and
all material consents, approvals, Orders, Permits or other authorizations
required by all applicable Regulations or Orders involving the Purchaser, with
respect to the execution, delivery and performance of the Agreement and the
consummation of the transactions contemplated hereby including, but not limited
to, any and all consents, waivers and/or approval required pursuant to the terms
of the Securities Purchase Agreement and the Debentures, and any required
consents and approvals from the board of directors of Parent.
8.3 NO PROCEEDING OR LITIGATION. No preliminary or permanent injunction
or other Order issued by a court of competent jurisdiction or by any Authority,
or any Regulation or Order promulgated or enacted by any Authority shall be in
effect which could reasonably be expected to (i) make illegal, or to delay or
otherwise directly or indirectly restrain or prohibit, the consummation of the
transactions contemplated by this Agreement, or result in damages in connection
with the transactions contemplated by this Agreement, (ii) result in (x) the
prohibition of ownership or the operation by the Parent or Seller of all or a
portion of the Acquired Assets or (y) the compelling of the Parent or Seller to
dispose of or to hold separately any portion of the business or assets of the
Parent or Seller or its Affiliates or subsidiaries as a result of the
transactions contemplated by this Agreement or (iii) result in any diminution in
the benefits expected to be derived by the Parent or Seller as a result of the
transactions contemplated by this Agreement.
ARTICLE IX
CLOSING
9.1 CLOSING.
(a) Unless this Agreement shall have been terminated or abandoned
pursuant to the provisions of Article X hereof, a closing of the
transactions contemplated by this Agreement (the "CLOSING") shall be
held on June 14, 2006 (the "CLOSING DATE"), or on such other date
designated by the Purchaser upon one (1) business day notice to Parent,
in the offices of White & Case, LLP, or such other location mutually
agreed to by the parties. The Closing shall not occur, in any event,
after June 16, 2006 (the "TERMINATION DATE"), unless mutually agreed by
the parties hereto.
(b) The parties hereby agree that on the Closing Date, the
Purchaser shall deposit the Purchase Price in a bank account to be
designated by ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇ Frome ▇▇▇▇▇▇▇▇▇▇ & Wolosky LLP, counsel
to the Seller and Parent (the "ESCROW AGENT"), in accordance with the
terms and conditions of an escrow agreement to be entered into among
the parties, substantially in the form of EXHIBIT 9.1(B) attached
15
hereto. Immediately upon the receipt of the Purchase Price by the
Escrow Agent, the parties hereby agree that the Closing shall be deemed
consummated.
.
ARTICLE X
TERMINATION AND ABANDONMENT
10.1 METHODS OF TERMINATION. This Agreement may be terminated and the
transactions herein contemplated may be abandoned at any time by:
(a) mutual consent of the Purchaser and Parent, collectively;
(b) the Purchaser or Parent if this Agreement is not consummated on
or before the Termination Date; PROVIDED THAT if any party has breached
or defaulted with respect to its obligations under this Agreement on or
before such date, such party may not terminate this Agreement pursuant
to this Section 10.1(b), and each other party to this Agreement may at
its option enforce its rights against such breaching or defaulting
party and seek any remedies against such party, in either case as
provided hereunder and by applicable Regulation;
(c) the Purchaser if as of the Termination Date any of the
conditions specified in Article VII hereof have not been satisfied or
if Parent or the Seller is otherwise in default under this Agreement or
if at any time prior to the Termination Date it becomes reasonably
apparent to the Purchaser that Parent or the Seller will be unable to
satisfy one or more of the representations and warranties in Article II
or one or more of the covenants or other agreements herein; or
(d) Parent if as of the Termination Date any of the conditions specified in
Article VIII hereof have not been satisfied or if the Purchaser is
otherwise in default under this Agreement it becomes reasonably
apparent to Parent that the Purchaser will be unable to satisfy one or
more of the representations and warranties in Article III or one or
more of the covenants or other agreements herein.
10.2 PROCEDURE UPON TERMINATION. In the event of termination and
abandonment pursuant to Section 10.1 hereof, and subject to the proviso
contained in Section 10.1(b) this Agreement shall terminate and shall be
abandoned, without further action by any of the parties hereto. If this
Agreement is terminated as provided herein:
(a) as soon as practicable following the Termination Date, each
party shall either destroy or redeliver all documents and other
material of any other party relating to the transactions contemplated
hereby, whether obtained before or after the execution hereof, to the
party furnishing the same;
(b) as soon as practicable following the Termination Date, all
information received by any party hereto with respect to the business
of any other party (other than information which is a matter of public
knowledge or which has heretofore been or is hereafter published in any
16
publication for public distribution or filed as public information with
any governmental authority) shall not at any time be used for the
advantage of, or disclosed to third parties by, such party to the
detriment of the party furnishing such information; and
(c) other than as provided in Section 11.13 no non breaching party
hereto shall have any liability or further obligation to any other
party to this Agreement.
ARTICLE XI
MISCELLANEOUS PROVISIONS
11.1 AMENDMENT AND MODIFICATION. This Agreement may be amended,
modified and supplemented only by written agreement of all the parties hereto
with respect to any of the terms contained herein. No course of dealing between
or among the parties shall be deemed effective to modify, amend, waive or
discharge any part of this Agreement or any rights or obligations of any party
under or by reason of this Agreement.
11.2 WAIVER OF COMPLIANCE; CONSENTS. Any failure of any party hereto to
comply with any obligation, covenant, agreement or condition herein may be
waived in writing by the other parties hereto, but such waiver or failure to
insist upon strict compliance with such obligation, covenant, agreement or
condition shall not operate as a waiver of, or estoppel with respect to, any
subsequent or other failure. Whenever this Agreement requires or permits consent
by or on behalf of any party hereto, such consent shall be given in writing to
be effective.
11.3 CERTAIN DEFINITIONS.
"AFFILIATE" means, with regard to any Person, (a) any Person,
directly or indirectly, controlled by, under common control of, or
controlling such Person; (b) any Person, directly or indirectly, in
which such Person holds, of record or beneficially, five percent (5%)
or more of the equity or voting securities; (c) any Person that holds,
of record or beneficially, five percent (5%) or more of the equity or
voting securities of such Person; (d) any Person that, through
Contract, relationship or otherwise, exerts a substantial influence on
the management of such Person's affairs; (e) any Person that, through
Contract, relationship or otherwise, is influenced substantially in the
management of its affairs by such Person; (f) any director, manager,
officer, partner or individual holding a similar position in respect of
such Person; or (g) as to any natural Person, any Person related by
blood, marriage or adoption and any Person owned by such Persons,
including without limitation, any spouse, parent, grandparent, aunt,
uncle, child, grandchild, sibling, cousin or in-law of such Person.
"ASSUMED OBLIGATIONS" shall have the meaning set forth in Section
1.2.
"AUTHORITY" means any governmental, regulatory or administrative
body, agency, commission, board, arbitrator or authority, any court or
judicial authority, any public, private or industry regulatory
authority, whether international, national, federal, state or local,
including the SEC.
17
"BUSINESS" shall have the meaning set forth in the Recitals.
"POST-CLOSING LIABILITY CLAIMS" shall have the meaning set forth in
Section 1.6.
"CLAIM" means any action, suit, claim, lawsuit, demand, suit,
inquiry, hearing, investigation, notice of a violation or
noncompliance, litigation, proceeding, arbitration, appeals or other
dispute, whether civil, criminal, administrative or otherwise.
"CLOSING" shall have the meaning set forth in Section 9.1.
"CLOSING DATE" shall have the meaning set forth in Section 9.1.
"COBRA" shall have the meaning set forth in Section 6.7.
"CODE" shall mean the Internal Revenue Code of 1986, as amended,
and the Regulations thereunder.
"CONTRACT" means any agreement, contract, commitment, instrument,
document, certificate or other binding arrangement or understanding,
whether written or oral.
"EXCLUDED LIABILITIES" shall have the meaning set forth in Section
1.2.
"EMPLOYEE BENEFITS PLANS" shall mean each employee benefit plan (as
defined in Section 3(3) of the Employee Retirement Income Security Act
of 1974, as amended) or material fringe benefit plan maintained or
contributed to or required to be contributed to by the Seller or any of
its Affiliates, with respect to any present or former employee of the
Business.
"FINANCIAL STATEMENT DATE" shall have the meaning set forth in
Section 2.3.
"FINANCIAL STATEMENTS" shall mean, collectively, the March
Financial Statements and the May Financial Statements.
"GAAP" means U.S. generally accepted accounting principles,
consistently applied, as in existence at the date hereof.
"GOVERNMENT ENTITY" shall mean a federal, state, provincial, local,
county or municipal government, governmental, regulatory or
administrative agency, department, commission, board, bureau, or other
Authority or instrumentality, domestic or foreign, including the SEC.
"GUARANTEE" means any guarantee or other contingent liability
(other than any endorsement for collection or deposit in the ordinary
course of business), direct or indirect with respect to any obligations
of another Person, through a Contract or otherwise, including, without
limitation, (a) any endorsement or discount with recourse or
undertaking substantially equivalent to or having economic effect
similar to a guarantee in respect of any such obligations and (b) any
Contract (i) to purchase, or to advance or supply funds for the payment
or purchase of, any such obligations, (ii) to purchase, sell or lease
18
property, products, materials or supplies, or transportation or
services, in respect of enabling such other Person to pay any such
obligation or to assure the owner thereof against loss regardless of
the delivery or nondelivery of the property, products, materials or
supplies or transportation or services or (iii) to make any loan,
advance or capital contribution to or other Investment in, or to
otherwise provide funds to or for, such other Person in respect of
enabling such Person to satisfy an obligation (including any liability
for a dividend, stock liquidation payment or expense) or to assure a
minimum equity, working capital or other balance sheet condition in
respect of any such obligation.
"INDEBTEDNESS" with respect to any Person means (a) any obligation
of such Person for borrowed money, but in any event shall include: (i)
any obligation or liabilities incurred for all or any part of the
purchase price of property or other assets or for the cost of property
or other assets constructed or of improvements thereto, other than
accounts payable included in current liabilities and incurred in
respect of property purchased in the ordinary course of business,
(whether or not such Person has assumed or become liable for the
payment of such obligation) (whether accrued, absolute, contingent,
unliquidated or otherwise, known or unknown, whether due or to become
due); (ii) the face amount of all letters of credit issued for the
account of such Person and all drafts drawn thereunder; (iii)
obligations incurred for all or any part of the purchase price of
property or other assets or for the cost of property or other assets
constructed or of improvements thereto, other than accounts payable
included in current liabilities and incurred in respect of property
purchased in the ordinary course of business (whether or not such
Person has assumed or become liable for the payment of such obligation)
secured by Liens; (iv) capitalized lease obligations; and (v) all
Guarantees of such Person; (b) accounts payable of such Person that
have not been paid within sixty (60) days of their due date and are not
being contested; (c) annual employee bonus obligations that are not
accrued on the Financial Statements; and (d) retroactive insurance
premium obligations.
"INTELLECTUAL PROPERTY" means all domestic and foreign patents,
patent applications, trademarks, service marks and other indicia of
origin, trademark and service ▇▇▇▇ registrations and applications for
registrations thereof, copyrights, copyright registrations and
applications for registration thereof, Internet domain names and
universal resource locators, trade secrets, inventions (whether or not
patentable), invention disclosures, moral and economic rights of
authors and inventors (however denominated), technical data, customer
lists, corporate and business names, trade names, trade dress, brand
names, know-how, show-how, maskworks, formulae, methods (whether or not
patentable), designs, processes, procedures, technology, source codes,
object codes, computer software programs, databases (which, with
respect to the Seller, contain at least 120 million postal addresses
and 90 million email addresses), data collectors and other proprietary
information or material of any type, whether written or unwritten (and
all good will associated with, and all derivatives, improvements and
refinements of, any of the foregoing).
"INVESTMENT" shall mean (a) any direct or indirect ownership,
purchase or other acquisition by a Person of any notes, obligations,
instruments, capital stock, Options, securities or ownership interests
(including partnership interests and joint venture interests) of any
19
other Person; and (b) any capital contribution or similar obligation by
a Person to any other Person.
"LIEN" means any (a) security interest, lien, mortgage, pledge,
hypothecation, encumbrance, Claim, easement, charge, restriction on
transfer or otherwise, or interest of another Person of any kind or
nature, including any conditional sale or other title retention
Contract or lease in the nature thereof; (b) any filing or agreement to
file a financing statement as debtor under the Uniform Commercial Code
or any similar statute; and (c) any subordination arrangement in favor
of another Person.
"MARCH FINANCIAL STATEMENTS" shall have the meaning set forth in
Section 2.3.
"MATERIAL ADVERSE EFFECT" means any circumstances, state of facts
or matters which might reasonably be expected to have a material
adverse effect in respect of the Business' operations, properties,
assets, condition (financial or otherwise), results, plans, strategies,
results of operations or prospects.
"MAY FINANCIAL STATEMENTS" shall have the meaning set forth in
Section 7.8.
"OPTION" means any subscription, option, warrant, right, security,
Contract, commitment, understanding, stock appreciation right, phantom
stock option, profit participation or arrangement by which (a) with
respect the Seller, the Seller is bound to issue any additional equity
interests of the Seller or rights pursuant to which any Person has a
right to purchase any equity interests of the Seller or (b) with
respect to Parent, Parent is bound to sell or allow another Person to
vote, encumber or control the disposition of the Seller's equity
interests or rights pursuant to which any Person has a right to
purchase, vote, encumber or control the disposition of the equity
interests of the Seller from Parent.
"ORDER" means any writ, decree, order, judgment, injunction, rule,
ruling, Lien, voting right, consent of or by an Authority.
"PARENT" shall have the meaning set forth in the Preamble.
"PERMITS" means all permits, licenses, registrations, certificates,
Orders, qualifications, variations, exemptions or approvals required by
any Authority, including the SEC, or any other Government Entity or
other Person.
"PERMITTED LIENS" means (a) statutory Liens not yet delinquent and
immaterial in amount; (b) such imperfections or irregularities of title
or Liens as do not materially detract from or interfere with the
present use of the properties or assets subject thereto or affected
thereby, otherwise impair present business operations at such
properties, or do not detract from the value of such properties and
assets; (c) Liens reflected in the Financial Statements or the notes
thereto; (d) mechanics', carriers', workers', repairmen's,
warehousemen's, or other similar Liens arising in the ordinary course
of business in respect of obligations not overdue and immaterial in
amount or which are being contested in good faith and covered by a bond
in an amount at least equal to the amount of the Lien; and (e) deposits
or pledges to secure workmen's compensation, unemployment insurance,
20
old age benefits or other social security obligations in connection
with, or to secure the performance of, bids, tenders, trade Contracts
not for the payment of money or leases, or to secure statutory
obligations or surety or appeal bonds or other pledges or deposits for
purposes of like nature in the ordinary course of business and
immaterial in amount.
"PERSON" means any corporation, partnership, joint venture, limited
liability company, organization, entity, Authority or natural person.
"POST-CLOSING LIABILITIES" shall have the meaning set forth in
Section 1.2.
"POST-CLOSING LIABILITY CLAIMS" shall have the meaning set forth in
Section 1.6.
"PRE-CLOSING PERIOD" shall have the meaning set forth in Section
2.5(a).
"PURCHASER" shall have the meaning set forth in the Preamble.
"REGULATION" means any rule, law, code, statute, regulation,
ordinance, requirement, announcement, policy, guideline, rule of common
law or other binding action of or by an Authority and any judicial
interpretation thereof.
"SEC" shall mean the Securities and Exchange Commission.
"SEC FILINGS" shall have the meaning set forth in Section 2.6.
"SELLER" shall have the meaning set forth in the Preamble.
"SELLER EMPLOYEES" shall have the meaning set forth in Section 6.7.
"SUBSIDIARY" any Person in which a Seller has (a) an Investment;
(b) advanced funds or provided financial accommodations to which, in
each case, is secured by an Investment in; or (c) has an Option to
acquire an Investment in such Person.
"TAX RETURNS" shall have the meaning set forth in Section 2.5.
"TAX" shall mean all taxes, assessments, charges, duties, fees,
levies or other governmental charges, including all federal, state,
local and other income, franchise, profits, capital gains, capital
stock, transfer, sales, AD VALOREM, use, occupation, property, excise,
severance, windfall profits, stamp, license, payroll, withholding and
other taxes, assessments, charges, duties, fees, levies or other
governmental charges of any kind whatsoever (whether payable directly
or by withholding and whether or not requiring the filing of a Tax
Return (as defined below)), all estimated taxes, deficiency
assessments, additions to tax, penalties and interest and shall include
any liability for such amounts as a result either of being a member of
a combined, consolidated, unitary or affiliated group or of a
contractual obligation to indemnify any Person.
"TERMINATION DATE" shall have the meaning set forth in Section
10.2.
21
"TRANSFERRED EMPLOYEES" shall have the meaning set forth in Section
6.7.
11.4 NOTICES. All notices, requests, demands and other communications
required or permitted hereunder shall be delivered in writing (and copied by
email to the recipient party) and shall be deemed to have been duly given (a)
one (1) business day after being delivered by hand, (b) five (5) business days
after being mailed first class or certified with postage paid or (c) one (1)
business day after being couriered by overnight receipted courier service:
(a) If to the Seller or Parent, to:
RelationServe Access, Inc.
c/o RelationServe Media, Inc.
▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇
▇▇. ▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇ 3702
Attn: ▇▇▇▇▇▇ ▇▇▇▇▇, Chief Financial Officer
Phone: (▇▇▇) ▇▇▇-▇▇▇▇ ext .140
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
with a copy to:
(which shall not constitute notice to the Seller or Parent)
▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇ Frome ▇▇▇▇▇▇▇▇▇▇ & ▇▇▇▇▇▇▇ LLP
Park Avenue Tower
▇▇ ▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Attn: ▇▇▇▇▇▇ ▇▇▇▇▇▇, Esq.
Phone: (▇▇▇) ▇▇▇-▇▇▇▇
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
or to such other Person or address as the Seller or Parent shall
furnish by notice to the Purchaser in writing.
(b) If to the Purchaser, to:
R.S.A.C., Inc.
c/o Come & Stay S.A.
▇▇ ▇▇▇ ▇▇ ▇'▇▇▇▇ ▇▇▇▇▇▇▇▇
▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇▇
Attn: ▇▇▇▇▇▇ ▇▇▇▇▇▇
Phone: (▇▇▇) ▇▇ ▇▇▇▇▇▇▇▇▇▇
Facsimile: (▇▇▇) ▇▇ ▇▇▇▇▇▇▇▇▇▇
22
with a copy to:
(which shall not constitute notice to the Purchaser)
White & Case LLP
Avocats au Barreau de Paris
▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇ ▇▇ ▇▇▇▇▇▇▇▇▇
▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇▇
Attention: ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇, Esq.
Phone: (▇▇▇) ▇▇ ▇▇▇▇▇▇▇▇▇
Facsimile: (▇▇▇) ▇▇ ▇▇▇▇▇▇▇▇▇
or to such other Person or address as the Purchaser shall furnish by
notice to the Seller in writing.
11.5 ASSIGNMENT. This Agreement and all of the provisions hereof shall
be binding upon and inure to the benefit of the parties hereto and their
respective successors and permitted assigns, but neither this Agreement nor any
of the rights, interests or obligations hereunder shall be assigned by any of
the parties hereto without the prior written consent of the other parties,
except that the Purchaser may, without the prior approval of Parent, assign its
rights, interests and obligations hereunder to any Affiliate, and may grant
Liens in respect of its rights and interests hereunder to its lenders (and any
agent for the lenders), and the parties hereto consent to any exercise by such
lenders (and such agent) of their rights and remedies with respect to such
collateral.
11.6 GOVERNING LAW. The Agreement shall be governed by the internal
laws of the State of Delaware as to all matters, without reference to principles
of conflicts of laws, including but not limited to matters of validity,
construction, effect and performance.
11.7 COUNTERPARTS. This Agreement may be executed in two or more
counterparts (including by means of telecopied signature pages), each of which
shall be deemed an original, but all of which together shall constitute one and
the same instrument. Counterpart signatures need not be on the same page and
shall be deemed effective upon receipt.
11.8 HEADINGS. The article and section headings contained in this
Agreement are for reference purposes only and shall not affect in any way the
meaning or interpretation of this Agreement.
11.9 ENTIRE AGREEMENT. This Agreement, including the schedules and
exhibits hereto and the Contracts, documents, certificates and instruments
referred to herein, embodies the entire agreement and understanding of the
parties hereto in respect of the transactions contemplated by this Agreement and
supersedes all prior Contracts, representations, warranties, promises,
covenants, arrangements, communications and understandings, oral or written,
express or implied, between the parties with respect to such transactions. There
are no Contracts, representations, warranties, promises, covenants, arrangements
or understandings between the parties with respect to the transactions
contemplated hereby, other than those expressly set forth or referred to herein.
23
11.10 INJUNCTIVE RELIEF. The parties hereto agree that in the event of
a breach of any provision of this Agreement or a failure by a party to perform
in accordance with the specific terms herein, the aggrieved party or parties may
be damaged irreparably and without an adequate remedy at law. The parties
therefore agree that in the event of a breach of any provision of this
Agreement, the aggrieved party or parties may elect to institute and prosecute
proceedings in any court of competent jurisdiction to enforce specific
performance or to enjoin the continuing breach of such provision without the
requirement of a posting of a bond, as well as to obtain damages for breach of
this Agreement. By seeking or obtaining any such relief, the aggrieved party
shall not be precluded from seeking or obtaining any other relief to which it
may be entitled.
11.11 DELAYS OR OMISSIONS. No delay or omission to exercise any right,
power or remedy accruing to any party hereto, upon any breach or default of any
other party under this Agreement, shall impair any such right, power or remedy
of such party nor shall it be construed to be a waiver of any such breach or
default, or an acquiescence therein, or of or in any similar breach or default
thereafter occurring; nor shall any waiver of any single breach or default be
deemed a waiver of any other breach or default theretofore or thereafter
occurring. Any waiver, permit, consent or approval of any kind or character on
the part of any party hereto of any breach or default under this Agreement, or
any waiver on the part of any party of any provisions or conditions of this
Agreement must be made in writing and shall be effective only to the extent
specifically set forth in such writing. All remedies, either under this
Agreement or by law or otherwise afforded to any party, shall be cumulative and
not alternative.
11.12 SEVERABILITY. Wherever possible, each provision of this Agreement
shall be interpreted in such manner as to be effective and valid under
applicable Regulations, but if any provision of this Agreement or the
application of any such provision to any Person or circumstance shall be held to
be prohibited by, illegal or unenforceable under applicable law in any respect
by a court of competent jurisdiction, such provision shall be ineffective only
to the extent of such prohibition or illegality or unenforceability, without
invalidating the remainder of such provision or the remaining provisions of this
Agreement.
11.13 EXPENSES. The Purchaser shall bear its own expenses, including
without limitation, legal fees and expenses, with respect to this Agreement and
the transactions contemplated hereby (including, without limitation, expenses or
fees payable to ▇▇▇▇▇ ▇▇▇▇▇▇▇). The Seller shall bear its own expenses,
including without limitation, brokerage or investment banking, accounting and
legal fees and expenses, with respect to this Agreement and the transactions
contemplated hereby. If any legal action or other proceeding relating to this
Agreement, the agreements contemplated hereby, the transactions contemplated
hereby or thereby or the enforcement of any provision of this Agreement or the
agreements contemplated hereby is brought against any party, the prevailing
party in such action or proceeding shall be entitled to recover all reasonable
expenses relating thereto (including attorney's fees and expenses) from the
party against which such action or proceeding is brought in addition to any
other relief to which such prevailing party may be entitled.
11.14 NO THIRD PARTY BENEFICIARIES. This Agreement is for the sole
benefit of the parties and their permitted successors and assigns and nothing
herein express or implied shall be construed to give any person, other than the
24
parties of such permitted successors and assigns, any legal or equitable rights
hereunder.
11.15 NO STRICT CONSTRUCTION. The parties have participated jointly in
the negotiation and drafting of this Agreement. In the event an ambiguity or
question of intent or interpretation arises, this Agreement shall be construed
as if drafted jointly by the parties, and no presumption or burden of proof
shall arise favoring or disfavoring any party by virtue of the authorship of any
of the provisions of this Agreement.
11.16 WAIVER OF JURY TRIAL. EACH OF THE PARTIES HERETO KNOWINGLY,
VOLUNTARILY AND INTENTIONALLY WAIVES ANY RIGHTS IT MAY HAVE TO A TRIAL BY JURY
IN RESPECT OF ANY LITIGATION BASED HEREON, OR ARISING OUT OF, UNDER, OR IN
CONNECTION WITH, THIS AGREEMENT OR ANY SCHEDULE OR EXHIBIT HERETO, OR ANY COURSE
OF CONDUCT, COURSE OF DEALING OR STATEMENTS (WHETHER VERBAL OR WRITTEN) RELATING
TO THE FOREGOING. THIS PROVISION IS A MATERIAL INDUCEMENT FOR THE PARTIES HERETO
TO ENTER INTO THIS AGREEMENT.
11.17 DISPUTE RESOLUTION. If the parties should have a dispute arising
out of or relating to the matters set forth in this Agreement, then the parties
will resolve such dispute in the following manner: (i) any party may at any time
deliver to the others a written dispute notice setting forth a brief description
of the issue for which such notice initiates the dispute resolution mechanism
contemplated by this Section 11.17; (ii) during the fifteen (15) day period
following the delivery of the notice described in Section 11.17(i) above,
appropriate representatives of the various parties will discuss and seek to
resolve the disputed issue through good faith negotiation, (iii) if
representatives of the parties are unable to resolve the disputed issue through
negotiation, then within fifteen (15) days after the period described in Section
11.17(ii) above, (a) in the event of a dispute initiated by Parent or Seller,
the parties shall refer the issue (to the exclusion of a court of law) to final
and binding arbitration in the ICC International Court of Arbitration in Paris,
France, and (b) in the event of a dispute initiated by the Purchaser, the
parties will refer the issue (to the exclusion of a court of law) to final and
binding arbitration in Tampa, Florida in accordance with the then existing rules
of the American Arbitration Association, and judgment upon the award rendered by
the arbitrators may be entered in any court having jurisdiction thereof;
PROVIDED, HOWEVER, that the law applicable to any controversy shall be the law
of the State of Florida, regardless of principles of conflicts of laws;
PROVIDED, FURTHER, that the foregoing provisions of this Section 11.17 shall not
apply with respect to any equitable or prejudgment remedies available to a party
hereunder or pursuant to any applicable law.
* * *
[SIGNATURES ON NEXT PAGE]
IN WITNESS WHEREOF, the parties hereto have made and entered into this
Asset Purchase Agreement the date first hereinabove set forth.
R.S.A.C., INC.
By: /s/▇▇▇▇▇▇ ▇▇▇▇▇▇
------------------------
Name: ▇▇▇▇▇▇ ▇▇▇▇▇▇
Title: President
RELATIONSERVE MEDIA, INC.
By: /s/ ▇▇▇▇ ▇▇▇▇▇▇▇
------------------------
Name: ▇▇▇▇ ▇▇▇▇▇▇▇
Title: Chief Executive Officer
RELATIONSERVE ACCESS, INC.
By: /s/ ▇▇▇▇▇ ▇▇▇▇▇▇▇▇
------------------------
Name: ▇▇▇▇▇ ▇▇▇▇▇▇▇▇
Title: President
SCHEDULE 1.1
EXCLUDED ASSETS
1. All intercompany balances, assets and receivables of any kind due and
owing to the Seller from Parent, ▇▇▇▇▇▇▇▇▇▇.▇▇▇, Inc., or OmniPoint
Marketing, LLC.
2. That certain Office Lease for Cypress Park West Office Building,
effective as of October 1, 2003, by and between Savannah Teachers
Properties, Inc. and Omni Point Marketing, LLC, a Florida limited
liability company.
3. All employment, consultancy or similar Contracts entered into between
the Seller and any Person existing on or prior to the Closing Date.
4. Any Employee Benefit Plan.
5. Any Tax refund or credit (or right to claim such a Tax refund or
credit) relating to the Seller for any period ending on or prior to the
Closing Date.
6. Rebates from suppliers for periods earned prior to the Closing.
7. All prepaid expenses relating to any asset of the Seller not included
among the Acquired Assets.
8. Rights retained in Seller and Parent to utilize the name
"RelationServe", as licensee (and any other trade names, trademarks, or
service marks derived therefrom), until such time that Parent
stockholder approval has been obtained for the Parent to change its
name, which time period shall not exceed 180 days following the Closing
Date.
9. Cash and cash equivalents, securities, security deposits, bank
balances, and deposit, escrow and similar cash or deposit accounts
(with the exception of the Seller's deposit account # _________________
with [name of bank], which shall be an Acquired Asset) and the proceeds
thereof.
SCHEDULE 1.2(A)
CERTAIN POST-CLOSING LIABILITIES
Parent and Seller hereby agree to be responsible for any amounts in
excess of the limits set forth on this SCHEDULE 1.2(A), including, but not
limited to, all legal, court and related fees.
1. Action brought by [▇▇▇▇▇▇▇ Law], brought in the [name of court],
against the Seller. (Purchaser responsibility not to exceed
$52,000.00).
2. Action brought by InfoLink Communications Services, Inc., brought in
the Circuit Court of Miami-Dade County, Florida, against RelationServe
Media, Inc. and Omni Point Marketing, LLC. (Purchaser responsibility
not to exceed [$1,600,000.00]).
3. Action brought by International Star Registry, brought in the [name of
court], against the Seller. (Purchaser responsibility not to exceed
$75,000.00).
4. Action brought by ▇▇▇▇ Portugal ▇▇▇▇▇, brought in the [name of court],
against the Seller. (Purchaser responsibility not to exceed $15,000).
5. Action brought by ▇▇▇▇▇ ▇▇▇▇▇▇▇▇, brought in the [name of court],
against the Seller. (Purchaser responsibility not to exceed $15,000).
6. Action brought by ▇▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇ & Liber, LLP, brought in the
[name of court], against the Seller. (Purchaser responsibility not to
exceed $20,000.00).
7. Action brought by True Beginnings, LLC, brought in the [name of court],
against the Seller. (Purchaser responsibility not to exceed $100,000).
8. All liabilities in connection with any Claim brought by IK Marketing
International, LLC, brought in the State Court of Louisiana, against
RelationServe Media, Inc. in excess of the amount set forth in that
certain Settlement Agreement dated April 28, 2006.
9. All liabilities in connection with any Claim brought by ▇▇▇▇▇ ▇▇▇▇▇▇,
brought in the [name of court], against RelationServe Media, Inc. in
excess of the agreed settlement amount of $40,114.
10. All liabilities in connection with any Claim brought by ▇▇▇▇ ▇▇▇▇▇▇▇,
brought in the Circuit Court for the 17th Judicial Circuit in Broward
County, Florida, against Parent (Purchaser amount not to exceed
$40,000, representing approximate amount of unpaid salary claimed under
▇▇. ▇▇▇▇▇▇▇'▇ terminated Employment Agreement).
SCHEDULE 1.2(B)
EXCLUDED LIABILITIES
1. All liabilities in connection with the intercompany loan between Parent
and Seller in the approximate aggregate amount of $3,000,000.
2. All liabilities in connection with any Claim brought by ▇▇▇▇▇ ▇▇▇▇▇▇,
former officer of Omni Point Marketing, LLC, a Florida limited
liability company, against the Purchaser, Parent, the Seller, or any of
their Affiliates.
3. All liabilities in connection with the Securities Purchase Agreement
and/or the Debentures.
4. All liabilities in connection with that certain Office Lease for
Cypress Park West Office Building, effective as of October 1, 2003, by
and between Savannah Teachers Properties, Inc. and Omni Point
Marketing, LLC, a Florida limited liability company (provided, however,
that if the Purchaser elects to utilize the related premises
post-Closing, the Purchaser shall be responsible for post-Closing
rental payments for the duration of such use, pursuant to Section 6.8).
6. All liabilities in connection with any Claim brought by the Law Offices
of ▇▇▇▇▇▇ ▇. ▇▇▇▇▇ PLLC, brought in the Superior Court of the District
of Columbia, Civil Division, against RelationServe Media, Inc. and Omni
Point Marketing, LLC.
7. All liabilities in connection with any Claim brought by Boston
Meridian, brought in the United States District Court, District of
Massachusetts, against RelationServe Media, Inc.
8. All liabilities in connection with any Claim brought by ▇▇▇▇▇▇▇ ▇.
▇▇▇▇▇▇▇▇, brought in the State Court of Indiana, County of ▇▇▇▇▇▇▇▇,
against RelationServe Media, Inc.
9. All liabilities in connection with Keystone Equities' Claims for fees
in connection with the financing of the SendTec acquisition
10. All liabilities in connection with Excelsius d/b/a Badhu's asserted
Claims for an additional fee to be paid to Excelsuis for locating
merger partner for reverse merger of Parent and Chubasco Resources.
11. All liabilities in connection with any Claim by ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇.
12. All liabilities in connection with any FBI investigation of Omnipoint,
Parent, the Seller or their Affiliates.
13. All liabilities in connection with any employment, consultancy or
similar Contract entered into between the Seller and any Person
existing on or prior to the Closing Date, other than the payment
obligations specifically assumed by Purchaser pursuant to Section 6.7.
14. All liabilities in connection with any Employee Benefit Plan, other
than the payment obligations specifically assumed by Purchaser pursuant
to Section 6.7.
15. All liabilities related to ▇▇▇▇▇▇▇▇▇▇.▇▇▇, Inc.