AGREEMENT
This
Agreement (the “Agreement”)
is
made and entered into this 25th day of April, 2008, by and among Global Services
Partners Acquisition Corp., a Delaware corporation (“GSPAC”),
SouthPeak Interactive, L.L.C., a Virginia limited liability company (the
“Company”),
and
the Members of the Company set forth on Schedule
I
attached
hereto (the “Members”).
WHEREAS,
the Members own all of the membership interests of the Company (the
“Membership
Interests”);
and
WHEREAS,
the Company and the Members have proposed to GSPAC that GSPAC acquire the
Membership Interests;
WHEREAS,
GSPAC is willing to acquire the Membership Interests upon and subject to the
conditions set forth in this Agreement (the “Acquisition”);
NOW,
THEREFORE, in consideration of the mutual promises hereinafter set forth and
other good and valuable consideration, the receipt and adequacy of which is
hereby acknowledged, the parties hereby agree as follows:
ARTICLE
I
ISSUANCE
OF SHARES; CALL RIGHT
1.1 Initial
Issuance; Call Right.
In
order to facilitate the consummation of the Acquisition, on the date hereof,
GSPAC shall issue to Xxxxx Xxxxxxxx, a Member (“Xxxxxxxx”), 1,000,000
shares of Common Stock (the “Initial Shares”) as an advance towards the
consideration to be paid by GSPAC for the Membership Interests. The issuance
of
the Initial Shares is in consideration for the extension of the exclusive
relationship between the Company and GSPAC set forth herein. If the consummation
of the Acquisition has not occurred by the close of business on May 15, 2008
(subject to the unilateral right of the Company to extend such date to May
30,
2008), the Initial Shares shall immediately be cancelled with no further action
on the part of Xxxxx Xxxxxxxx and shall revert to the status of authorized
and
unissued shares of common stock of GSPAC.
1.2 Restricted
Shares. The
Initial Shares shall be non-transferable until the Acquisition is consummated
and shall be “restricted shares”. GSPAC shall have the right to place
appropriate restrictive legends on the certificates representing the Initial
Shares.
ARTICLE
II
THE
ACQUISITION
2.1 Certain
Terms of the Acquisition. The
definitive agreements for the Acquisition shall include customary terms and
provisions and shall also include the following specific terms and
conditions:
(a) Subsequent
to the date of this Agreement but prior to (or concurrently with) the
consummation of the Acquisition (the “Closing”), GSPAC and/or the Company
shall have received new unrestricted financing of at least $5 million in total
gross proceeds.
(b) The
acquisition shall have been consummated by May 31, 2008.
(c) The
total
purchase price to be paid by GSPAC for the Membership Interests shall not
include any cash consideration and shall be in the form of common stock having
a
fair value of no more than $35,000,000 in the aggregate.
(d) GSPAC
shall have obtained 12 months of directors’ and officers’ liability insurance
and 12 months of “tail” coverage for any departing directors and officers of
GSPAC.
(e) All
of
GSPAC’s known outstanding liabilities due as of the Closing shall have been paid
in full or, if not yet due, adequate provision shall have been made for the
same.
(f) The
definitive agreements for the Acquisition shall have been approved by the Board
of Directors of GSPAC, which shall have determined that the terms of the
Acquisition are fair to and in the best interests of the public
stockholders of GSPAC (it being understood that the terms set forth herein
are deemed to be fair), and by the stockholders of GSPAC (which approval may
be
made pursuant to a written consent of stockholders) to the extent such approval
is necessary to enable the Acquisition to occur.
(g) GSPAC,
the Company and the Members shall, in connection with the Acquisition, have
complied with all applicable provisions of Delaware corporate law and federal
securities laws.
ARTICLE
III
REPRESENTATIONS
AND WARRANTIES
3.1 GSPAC,
on
the one hand, and the Company and the Members, on the other hand, hereby
represent and warrant to the other as follows:
(a) If
such
party is not an individual, it is either a corporation
or
limited liability company, duly organized, validly existing and in good standing
under the laws of its jurisdiction of organization and has the requisite limited
liability company or corporate power and authority to own, lease and operate
its
assets and properties and to carry on its business as currently
conducted.
(b) Such
party has all necessary power, capacity and authority to execute and deliver
this Agreement and to perform its, his or her obligations hereunder and to
consummate the transactions contemplated hereby. The execution and delivery
of
this Agreement and the consummation by such party of the transactions
contemplated hereby have been duly and validly authorized by all necessary
limited liability company or corporate action. Such party has duly and validly
executed and delivered this Agreement, and assuming the due authorization,
execution and delivery thereof by the other parties hereto, this Agreement
constitutes the legal and binding obligation of such party, enforceable against
such party in accordance with its terms, except as may be limited by bankruptcy,
insolvency, reorganization or other similar laws affecting the enforcement
of
creditors’ rights generally and by general principles of equity.
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3.2 Xxxxxxxx
represents that he is an accredited investor within the meaning of Regulation
D
under the Securities Act of 1933, as amended.:
ARTICLE
IV
CONDITION
PRECEDENT TO THE EFFECTIVENESS OF THIS AGREEMENT
4.1 The
effectiveness of this Agreement is subject to the satisfaction of the following
conditions, none of which may be waived or modified:
(a) The
Initial Shares shall have been issued and delivered to Xxxxxxxx in accordance
with the terms and conditions of this Agreement.
(b) GSPAC
shall have in effect policies of insurance described in Section 2.1(d) of this
Agreement providing coverage through at least May 30, 2008.
(c) GSPAC
and
HCFP/Xxxxxxx Securities LLC shall have executed and delivered on the date hereof
a letter or letters modifying, in the manner described in Schedule 4.1 hereto,
the “Insider Letters” that were executed by all of the persons who were
securityholders of GSPAC prior to the completion of its initial public offering
or who were directors or officers of GSPAC on or prior to the date
hereof.
ARTICLE
V
ADDITIONAL
AGREEMENTS
5.1 Confidential
Information; Non-Solicitation or Negotiation.
(a) Confidential
Information.
Except
in connection with any dispute between the parties and subject to any obligation
to comply with (i) any applicable law, (ii) any rule or regulation of any
governmental entity or securities exchange, or (iii) any subpoena or other
legal
process to make information available to the persons entitled thereto, whether
or not the transactions contemplated herein shall be concluded, all information
obtained by any party about any other, and all of the terms and conditions
of
this Agreement, shall be kept in confidence by each party, and each party shall
cause its Members, stockholders, directors, officers, managers, employees,
agents and attorneys to hold such information confidential. Such confidentiality
shall be maintained until such time, if any, as any such data or information
either is, or becomes, published or a matter of public knowledge; provided,
however, that the foregoing shall not apply to any information obtained by
a
party through its own independent investigations of the other party or received
by a party from a source not known by such party to be bound by a
confidentiality agreement with, or other contractual, legal or fiduciary
obligation of confidentiality to, the other party, nor to any information
obtained by a party which is generally known to others engaged in the trade
or
business of such party. In the event a party to this Agreement becomes legally
compelled to disclose any such information, it shall promptly provide the others
with written notice of such requirement so that the other parties to this
Agreement may seek a protective order or other remedy.
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(b) No
Solicitation or Negotiation.
From
the date hereof until the earliest of the consummation of this Agreement, the
termination of this Agreement or May 15, 2008 (unless this Agreement is extended
pursuant to its terms in which case such date shall be May 31, 2008), none
of
the Company, the Members or GSPAC shall, and each such party shall not suffer
or
permit their respective directors, officers, stockholders, employees,
representatives, agents, investment bankers, advisors, accountants or attorneys,
to initiate or solicit, directly or indirectly, any inquiries or the making
of
any offer or proposal that constitutes or would be reasonably expected to lead
to a proposal or offer (other than as expressly contemplated by this Agreement)
for a stock purchase, asset acquisition, merger, consolidation or other business
combination involving any of the Company or GSPAC or any proposal to acquire
in
any manner a direct or indirect substantial equity interest in, or all or any
substantial part of the assets of, Company or GSPAC (an “Alternative
Proposal”)
from
any person and/or entity, or engage in negotiations or discussions relating
thereto or accept any Alternative Proposal, or make or authorize any statement,
recommendation or solicitation in support of any Alternative
Proposal.
5.2 Public
Disclosure.
GSPAC,
the Company and the Members shall consult with each other before issuing any
press release or otherwise making any public statement or making any other
public (or non-confidential) disclosure (whether or not in response to an
inquiry) regarding the terms of this Agreement and the transactions contemplated
hereby; provided, however that the foregoing shall not prevent any party from
making any disclosure or filing required by applicable law.
5.3 Indemnification.
All
rights to indemnification for acts or omissions occurring through the Closing
now existing in favor of the current directors and officers of GSPAC and the
Company as provided in the organic documents of GSPAC and the Company or in
any
indemnification agreements shall survive the Closing and shall continue in
full
force and effect in accordance with their terms.
5.4 Further
Assurances.
Each of
the parties to this Agreement shall use its commercially reasonable efforts
to
effectuate the transactions contemplated hereby and to fulfill and cause to
be
fulfilled the conditions to closing under this Agreement. Each party hereto,
at
the reasonable request of another party hereto, shall execute and deliver such
other instruments and do and perform such other acts and things as may be
necessary or desirable for effecting completely the consummation of this
Agreement and the transactions contemplated hereby.
5.5 Further
Assurances.
Immediately after the effectiveness of this Agreement, Xxxxx Xxxxxxx and
Xxxxx Xxxxx shall resign from the GSPAC Board of Directors, and at the request
of Xxxxxxxx, two designees of Xxxxxxxx shall be elected to the Board of
Directors of GSPAC.
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ARTICLE
VI
GENERAL
PROVISIONS
6.1 Notices.
All
notices and other communications hereunder shall be in writing and shall be
deemed given if delivered personally or by commercial delivery service, or
mailed by registered or certified mail (return receipt requested) or sent via
facsimile (with confirmation of receipt) to the party or parties
hereto.
6.2 Amendment;
Modification; Waiver.
This
Agreement may not be amended or modified and none of its provisions may be
waived except pursuant to a writing signed on behalf of all of the parties
hereto; and provided, further, however, that for any such writing to be
effective, it shall have been authorized and approved by a majority of the
disinterested members of the Board of Directors of GSPAC.
6.3 Termination.
This
Agreement shall terminate automatically if the Closing shall not have occurred
by May 15, 2008; provided that such date may be unilaterally extended to May
31,
2008 at the option of the Company.
6.4 Entire
Agreement.
This
Agreement constitutes the entire agreement among the parties with respect to
the
subject matter hereof and supersedes all prior agreements and understandings,
both written and oral, among the parties with respect to the subject matter
hereof, except for the Non-Disclosure Agreement, dated July 2, 2007, by and
between GSPAC and the Company, which shall continue in full force and effect,
and shall survive any termination of this Agreement or the Closing, in
accordance with its terms.
6.5 Governing
Law.
This
Agreement shall be governed by and construed in accordance with the laws of
the
State of Delaware, without regard to the laws that might otherwise govern under
applicable principles of conflicts of law.
[Signature
Page to Follow]
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IN
WITNESS WHEREOF, this Agreement has been duly executed by the parties as of
and
on the date first above written.
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GSPAC:
By:
/s/ Xxxxx X.
Xxxxxxx
Name: Xxxxx
X. Xxxxxxx
Title:
Chief
Executive Officer
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By:
/s/ Xxxxxxxx
Xxxx
Name: Xxxxxxxx
Xxxx
Title: President
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COMPANY:
SOUTHPEAK
INTERACTIVE, L.L.C.
By: /s/
Xxxxx
Xxxxxxxx
Name: Xxxxx
Xxxxxxxx
Title: Managing
Member
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MEMBERS:
/s/
Xxxxx
Xxxxxxxx
Xxxxx
Xxxxxxxx
/s/
Xxxxxxx
Xxxxxxxx
Xxxxxxx
Xxxxxxxx
/s/Xxxxxxx
Xxxx
Xxxxxxx
Xxxx
/s/
Xxxxx
Xxxxxx
Xxxxx
Xxxxxx
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SCHEDULE
I
MEMBERS
OF THE COMPANY
Xxxxx
X.
Xxxxxxxx
Xxxxxxx
Xxxxxxxx
Xxxxxxx
Xxxx
Xxxxx
Xxxxxx
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SCHEDULE
4.1
MODIFICATIONS
TO “INSIDER LETTERS”
Amend
or
modify the “insider letters” as follows:
a.
The
following provisions of the “insider letters” shall be effective only so long as
the signatory to the “insider letter” is a director or officer of GSPAC:
Paragraphs 1 (first sentence) and the entirety of Paragraphs 3, 4, 5 and
6;
b.
Delete
clause (ii) in first sentence of Paragraph 1.
c.
Add
the following proviso at the end of Paragraph 1: "; provided, however, that
the
underlying transaction giving rise to any such loss, liability, claim, etc.
shall have occurred while the undersigned was a director or officer of the
Company."
d.
Delete
the first sentence of Paragraph 7.
e.
Amend
the definition of “Business Combination” in Paragraph 10(i) to add the following
at the end thereof: ", which in any such case was approved by the Class B
stockholders of the Company on or prior to April 25, 2008;"
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