SECURITIES PURCHASE AGREEMENT
This
SECURITIES PURCHASE AGREEMENT (this "Agreement")
is
made as of March 31, 2008, by and between Debt
Resolve, Inc.,
a
Delaware corporation with its principal office at 000 Xxxxxxxxxxx Xxxxxx, Xxxxx
X0, Xxxxx Xxxxxx, Xxx Xxxx 00000 (the "Company"),
and
Harmonie
International, LLC,
a
Delaware limited liability company with its principal office at 00000 Xxxxxxx
Xxxx Xxxx, Xxxxx 000, Xxxxxxxxxx Xxxxx, Xxxxxxxx 00000 (the "Purchaser").
WHEREAS,
the Company desires to issue and sell to the Purchaser (i) 2,966,102 shares
(the
"Shares")
of the
authorized but unissued shares of the Company's common stock, par value $.001
per share (the "Common
Stock"),
and
(ii) warrants to purchase up to 3,707,627 shares of the Common Stock (the
“Warrants”);
and
WHEREAS,
the Purchaser wishes to purchase the Shares upon the terms and subject to the
conditions set forth in this Agreement.
NOW
THEREFORE, in consideration of the mutual agreements, representations,
warranties and covenants herein contained, the parties hereto agree as
follows:
1. Definitions.
As used
in this Agreement, the following terms shall have the following respective
meanings:
"Affiliate"
of a
party means any other Person controlling, controlled by or under common control
with the specified Person. For the purposes of this definition, "control"
means
the power to direct the management and policies of such Person, whether through
the ownership of voting securities, by contract or otherwise.
"Exchange
Act"
means
the Securities Exchange Act of 1934, as amended, and all of the rules and
regulations promulgated thereunder.
"GAAP"
means
United States generally accepted accounting principles.
"Material
Adverse Effect"
shall
mean a material adverse effect on the prospects, condition (financial or other),
business, operations, assets, liabilities, or results of operations of the
Company and its subsidiaries, taken as a whole.
"Person"
shall
mean an individual, corporation, company, partnership, firm, association, joint
venture, trust, unincorporated organization, government, governmental body,
agency, political subdivision or other entity.
"SEC"
shall
mean the U.S. Securities and Exchange Commission.
"Securities
Act"
shall
mean the Securities Act of 1933, as amended, and all of the rules and
regulations promulgated thereunder.
"Warrant
Share"
shall
mean the shares of Common Stock issuable or issued upon the exercise of the
Warrants.
2. Purchase
and Sale of Shares and Warrants.
2.1 Purchase
and Sale.
Subject
to and upon the terms and conditions set forth in this Agreement, the Company
agrees to issue, sell and deliver to the Purchaser, and the Purchaser hereby
agrees to purchase from the Company, at the Closing, (i) 2,966,102 shares of
Common Stock, at a purchase price per share of $2.36 (the “Purchase
Price”),
and
(ii) one or more Warrants to purchase up to 3,707,627 shares of Common Stock,
at
an exercise price per Warrant Share of $2.36. The total purchase price payable
by the Purchaser for the shares of Common Stock and the Warrants that the
Purchaser is hereby agreeing to purchase is $7,000,000.
2.2 Closing.
The
closing of the transactions contemplated under this Agreement (the "Closing")
shall take place at 10:00 a.m. at the offices of Xxxxxxxxx Xxxxxxx, LLP in
New
York, New York, on March 31, 2008, or at such other location, date and time
as
may be agreed upon between the Purchaser and the Company (the "Closing
Date").
At
the Closing, the Company shall authorize its transfer agent to issue to the
Purchaser, against delivery of payment for the Shares and the Warrants by wire
transfer of immediate available funds in accordance with the Company's
instructions, (i) one or more stock certificates registered in the name of
the
Purchaser, representing the Shares, and (ii) one or more warrant certificates
registered in the name of the Purchaser to purchase the shares of Common Stock,
and, in the case of both (i) and (ii) above, bearing the legend set forth in
Section 6.2 hereof. Closing documents may be delivered by facsimile with
original signature pages sent by overnight courier.
3. Representations
and Warranties of the Company.
The
Company hereby represents and warrants to the Purchaser as follows:
3.1 Organization
and Good Standing.
The
Company is a corporation duly organized, validly existing and in good standing
under the laws of the State of Delaware and has all requisite power and
authority, and all necessary licenses and permits, to own and lease its
properties and assets and to conduct its business as now conducted. Each
subsidiary as referred to in the SEC Documents (as hereinafter defined) is
a
corporation duly organized, validly existing and in good standing under the
laws
of the jurisdiction of its incorporation and has all requisite power and
authority, and all necessary licenses and permits, to own and lease its
properties and assets and to conduct its business as now conducted. The Company
and its subsidiaries are each qualified to do business as a foreign corporation
and are in good standing in all states where the conduct of their respective
businesses or their ownership or leasing of property requires such
qualification, except where the failure to so qualify would not have a Material
Adverse Effect. The Company does not own or control, directly or indirectly,
any
interest in any other corporation, partnership, limited liability company,
unincorporated business organization, association, trust or other business
entity.
3.2 Capitalization.
(a)
The
authorized capital stock of the Company consists of: (i) 10,000,000 shares
of
preferred stock of the Company, par value $.001 per share, of which no shares
are issued or outstanding; and (ii) 100,000,000 shares of Common Stock, par
value $.0001 per share, of which, immediately prior to the consummation of
the
transactions contemplated hereby, (A) 8,474,363 shares are issued and
outstanding and all such outstanding shares are validly issued, fully paid
and
non-assessable; (B) 3,853,434 shares of Common Stock are reserved for issuance
upon the exercise of outstanding stock options granted under the Company's
2005
Incentive Compensation Plan; and (C) 2,042,770 shares of Common Stock are
reserved for issuance upon exercise of outstanding warrants.
(b)
There
are no preemptive or similar rights to purchase or otherwise acquire shares
of
capital stock of the Company pursuant to any provision of law or the Certificate
of Incorporation or By-laws of the Company or by agreement or otherwise. Except
for the Warrants, as set forth in this Section 3.2 and except as set forth
in
the SEC Documents, there are no outstanding subscriptions, warrants, options
or
other rights or commitments of any character to subscribe for or purchase from
the Company, or obligating the Company to issue, any shares of capital stock
of
the Company or any securities convertible into or exchangeable for such
shares.
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(c)
There
are no stockholder agreements, voting agreements, or similar agreements with
respect to the Common Stock to which the Company is a party, or to the knowledge
of the Company, by or between any stockholders of the Company or any of its
Affiliates.
3.3 Authorization.
The
Company has all requisite corporate power to enter into this Agreement, to
issue
the Shares, the Warrants and the Warrant Shares and to carry out and perform
its
obligations under the terms of this Agreement (including, without limitation,
the issuance of the Shares, the Warrants and the Warrant Shares). All corporate
action on the part of the Company, its officers, directors and stockholders
necessary for the authorization, execution, delivery and performance of this
Agreement and the consummation of the transactions contemplated herein has
been
taken or will be taken prior to the Closing Date. When executed and delivered
by
the Company, this Agreement shall constitute the legal, valid and binding
obligation of the Company, enforceable against the Company in accordance with
their respective terms, except as such may be limited by bankruptcy, insolvency,
reorganization or other laws affecting creditors' rights generally and by
general equitable principles.
3.4 Valid
Issuance of the Shares and the Warrant Shares.
The
Shares and the Warrant Shares will, upon issuance pursuant to the terms hereof,
be validly issued, fully paid and non-assessable, free from all liens, claims,
encumbrances with respect to the issuance of such Shares and Warrant Shares
and
will not be subject to any preemptive or similar rights. Except for blue sky
filing fees, if any, there are no state or city taxes, fees or other charges
payable in connection with the execution or delivery of this Agreement, the
Shares, the Warrants and the Warrant Shares.
3.5 SEC
Documents.
The
Company has made available to the Purchaser, a true and complete copy of the
Company's Annual Report on Form 10-KSB for the year ended December 31, 2006,
and
any other statement, report, registration statement (other than registration
statements on Form S-8) or definitive proxy statement filed by the Company
with
the SEC during the period commencing on December 31, 2006 and ending on the
date
hereof. The Company will, promptly upon the filing thereof, also make available
to the Purchaser on its website, xxx.xxxxxxxxxxx.xxx, all statements, reports
(including, without limitation, Quarterly Reports on Form 10-Q and Current
Reports on Form 8-K), registration statements and definitive proxy statements
filed by the Company with the SEC during the period commencing on the date
hereof and ending on the Closing Date (all such materials required to be
furnished to the Purchaser pursuant to this sentence or pursuant to the next
preceding sentence of this Section 3.5 being called, collectively, including
any
amendments thereto, the "SEC
Documents").
Since
January 1, 2007, the Company has timely made all filings required to be made
by
it under the Exchange Act and the securities laws of any state, and any rules
and regulations promulgated thereunder. The SEC Documents comply in all material
respects with the requirements of the Exchange Act or the Securities Act, as
applicable, and none of the SEC Documents contained any untrue statement of
a
material fact or omitted to state a material fact required to be stated therein
or necessary in order to make the statements made therein, in light of the
circumstances under which they were made, not misleading, as of their respective
filing dates, except to the extent corrected by a subsequently filed SEC
Document filed prior to the date hereof.
3.6 Financial
Statements.
All
financial statements included in the SEC Documents (hereinafter referred to
collectively as the "Financial
Statements")
have
been prepared in accordance with U.S. generally accepted accounting principles
applied on a consistent basis during the periods involved, and fairly present,
in all material respects, the financial position of the Company and the results
of its operations as of the date and for the periods indicated thereon. Since
December 31, 2006, to the Company's knowledge, (i) there has been no development
or change (actual or threatened), individually or in the aggregate, having
a
Material Adverse Effect, (ii) except as set forth in an SEC Document (as defined
below), there does not exist any condition reasonably likely to result in a
Material Adverse Effect and (iii) the Company has conducted its business only
in
the ordinary course consistent with past practice. The Company has no
indebtedness, obligations or liabilities of any kind (whether accrued, absolute,
contingent or otherwise, and whether due or to become due) which were not fully
reflected in, reserved against or otherwise described in the Financial
Statements or the notes thereto, or incurred in the ordinary course of business
consistent with the Company's past practices, all of which individually and
in
the aggregate do not or would not have a Material Adverse Effect.
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3.7 Consents.
Except
for filings under federal and applicable state securities laws and except for
Permits (as defined below), the absence of which either individually or in
the
aggregate would not have a Material Adverse Effect, all permits, consents,
approvals, orders, authorizations of, or declarations to (collectively,
"Permits")
or
filings with any federal, state, local or foreign court, governmental or
regulatory authority, or other person (including third party consents) required
on the part of the Company in connection with the execution, delivery or
performance of this Agreement and the consummation of the transactions
contemplated herein have been obtained or will be obtained prior to the Closing
Date, and will be effective as of the Closing Date.
3.8 No
Conflict.
The
execution and delivery of this Agreement by the Company and the consummation
of
the transactions contemplated hereby (including, without limitation, the
issuance of the Shares, the Warrants and the Warrant Shares) will not (x)
conflict with or result in any violation of or default (with or without notice
or lapse of time, or both) under, or give rise to a right of termination,
cancellation or acceleration of any obligation or to a loss of a material
benefit under (i) any provision of the Certificate of Incorporation or By-laws
of the Company or (ii) any agreement or instrument, Permit, franchise, license,
judgment, order, statute, law, ordinance, rule or regulations, applicable to
the
creation of any lien, security interest, charge or encumbrance upon the
Company's or any of its subsidiaries' assets, properties or outstanding capital
stock.
3.9 Brokers
or Finders.
Except
for The Resolution Group, Inc. (“TRG”), the Company has not dealt with any
broker or finder in connection with the transactions contemplated by this
Agreement, and, except for certain fees and expenses payable by the Company
to
TRG, the Company has not incurred, and shall not incur, directly or indirectly,
any liability for any brokerage or finders' fees or agents commissions or any
similar charges in connection with this Agreement or any transaction
contemplated hereby.
3.10 American
Stock Exchange.
The
Common Stock is listed on the American Stock Exchange and, except as disclosed
in the SEC Documents, there are no proceedings to revoke or suspend such
listing. The Common Stock is registered pursuant to Section 12(b) of the
Exchange Act. The Company has taken no action designed to, or which to its
knowledge is likely to have the effect of, terminating the registration of
the
Common Stock under the Exchange Act or delisting the Common Stock from the
American Stock Exchange. The Company has not received any notification that,
and
has no knowledge that, the SEC is contemplating terminating such registration.
The issuance of the Shares, the Warrants and the Warrant Shares does not require
stockholder approval.
3.11 Absence
of Litigation.
There
is no action, suit or proceeding or, to the Company's knowledge, any
investigation, pending, or to the Company's knowledge, threatened by or before
any governmental body against the Company, its subsidiaries, its activities,
properties or assets or any officer, director, or employee of the Company in
connection with such officer's, director's or employee's relationship with,
or
actions taken on behalf of the Company and in which an unfavorable outcome,
ruling or finding in any said matter, or for all matters taken as a whole,
might
have a Material Adverse Effect. The foregoing includes, without limitation,
any
such action, suit, proceeding or investigation that questions this Agreement
or
the right of the Company to execute, deliver and perform under same. The Company
is not a party to or subject to the provisions of any order, writ, injunction
or
decree of any court or government agency.
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3.12 Title
to Property and Assets.
Except
as disclosed in the SEC Documents, each of the Company and its subsidiaries
owns
its property and assets free and clear of all mortgages, liens, loans, claims,
charges and encumbrances, and except such encumbrances and liens that arise
in
the ordinary course of business and do not materially impair their respective
ownership or use of such property or assets. With respect to property and assets
it leases, the Company is in material compliance with such leases and, to the
best of its knowledge, holds a valid leasehold interest free of any liens,
charges, claims or encumbrances, except to the extent any such lien, charge,
claim or encumbrance would not have a Material Adverse Effect.
3.13 Patents,
Trademarks, Proprietary Rights.
(a)
To
the Company's knowledge, each of the Company and its subsidiaries owns or has
the right to use all of the Intellectual Property Rights (as defined below),
except where such failure would not have a Material Adverse Effect on the
business, properties or assets of the Company and its subsidiaries, taken as
a
whole. For purposes of this Agreement, "Intellectual
Property Rights"
means
all patents, copyrights, trademarks, service marks, trade names, permits, trade
secrets, computer programs, software designs and related materials and other
intellectual property that are used by the Company or a subsidiary and are
material to the conduct of the Company's or a subsidiary's
business.
(b)
To
the Company's knowledge, the Company's and each subsidiary's use and enjoyment
of the Intellectual Property Rights do not violate any license or conflict
with
or infringe the intellectual property rights of others in a manner which would
materially and adversely affect the business, assets, properties, operations
or
condition (financial or otherwise) of the Company and its subsidiaries, taken
as
a whole.
3.14 Environmental
Matters.
Except
as set forth in the SEC Documents, to the Company's knowledge, neither the
Company nor any of its subsidiaries is in violation of any applicable statute,
law or regulation relating to the environment or occupational health and safety,
which violation could reasonably be expected to result in a Material Adverse
Effect, and to the best of its knowledge, no expenditures are required in order
to comply with any such existing statute, law or regulation, which expenditures
could reasonably be expected to result in a Material Adverse
Effect.
3.15 Permits.
Each of
the Company and its subsidiaries possesses all Permits or similar authority
necessary to conduct its business as described in the SEC Documents, except
where the failure to possess such Permits would not, individually or in the
aggregate, have a Material Adverse Effect on the Company or its subsidiaries
("Material
Permits"),
and
neither the Company nor any such subsidiary has received any notice of
proceedings relating to the revocation or modification of any Material
Permit.
3.16 Employees.
To the
Company's knowledge, no strike, labor dispute or union organizing activities
are
pending or threatened against the Company or any of its subsidiaries by its
employees. No employees belong to a union or collective bargaining unit. To
the
Company's knowledge, neither the Company nor any of its subsidiaries has any
workers' compensation liabilities.
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3.17 Compliance
with Certificate of Incorporation and By-laws; Compliance with
Laws.
The
Company is not in violation or default of any provisions of its Certificate
of
Incorporation or By-laws. The business and operations of the Company and each
of
its subsidiaries have been conducted in accordance with all applicable laws,
rules and regulations of all governmental agencies, authorities and
instrumentalities (including, without limitation, under the Employee Retirement
Income Security Act of 1974, as amended, and all laws relating to the collection
of debt), except for such violations which would not, individually or in the
aggregate, have a Material Adverse Effect.
3.18 Insurance.
The
Company and each of its subsidiaries maintains insurance of the type and in
the
amount reasonably adequate for its business, including, but not limited to,
insurance covering all real and personal property owned or leased by the Company
against theft, damage, destruction, acts of vandalism, and all other risks
customarily insured against by similarly situated companies, all of which
insurance is in full force and effect.
3.19 Investment
Company Act.
The
Company is not an "Investment Company" within the meaning of the Investment
Company Act of 1940, as amended (the "Investment
Company Act"),
and
the Company is not directly or indirectly controlled by or acting on behalf
of
any person that is an "Investment Company" within the meaning of the Investment
Company Act.
3.20 Compliance
with Securities Laws.
Assuming the accuracy of the representations and warranties of the Purchaser
set
forth in Section 4 hereof, the offer and sale by the Company of the Shares
and
the Warrants are exempt from the registration and prospectus delivery
requirements of the Securities Act. Other than pursuant to an effective
registration statement under the Securities Act, the Company has not issued,
offered or sold any shares of Common Stock (including for this purpose any
securities of the same or a similar class as the Common Stock) within the
six-month period preceding the date hereof or taken any other action, or failed
to take any action, that, in any such case, would (i) eliminate the availability
of the exemption from registration under Regulation D under the Securities
Act
in connection with the offer and sale of the Shares and the Warrants as
contemplated hereby or (ii) cause the offering of the Shares or the Warrants
pursuant to this Agreement to be integrated with prior offerings by the Company
for purposes of the Securities Act or any applicable stockholder approval
provisions. The Company shall not directly or indirectly take, and shall not
permit any of its directors, officers or Affiliates directly or indirectly
to
take, any action (including, without limitation, any offering or sale to any
Person of the Shares, the Warrants or any Common Stock) that will make
unavailable the exemption from registration under the Securities Act being
relied upon by the Company for the offer and sale to the Purchaser of the Shares
and the Warrants as contemplated by this Agreement, including, without
limitation, the filing of a registration statement under the Securities Act.
No
form of general solicitation or advertising within the meaning of Rule 502(c)
under the Securities Act has been used or authorized by the Company or any
of
its officers, directors or Affiliates in connection with the offer or sale
of
the Shares and the Warrants as contemplated by this Agreement or any other
agreement to which the Company is a party.
3.21 Registration
Rights.
Except
as set forth in the SEC Documents, there are no Persons with registration or
other similar rights to have any securities registered by the Company under
the
Securities Act which have not been satisfied.
3.22 Related-Party
Transactions.
Except
as set forth in the SEC Documents, neither the Company nor any of its officers,
directors or Affiliates nor any family member of any officer, director or
Affiliate of the Company has borrowed any moneys from or has outstanding any
indebtedness or other similar obligations to the Company. Except as set forth
in
the SEC Documents, no director or Affiliate nor any family member of any
officer, director or Affiliate of the Company (i) owns any direct or indirect
interest constituting more than a 1% equity (or similar profit participation)
interest in, or controls or is a director, officer, partner, member or employee
of, or consultant or lender to or borrower from, or has the right to participate
in the profits of, any person or entity which is a participant in any
transaction to which the Company or any subsidiary is a party or (ii) is a
party
to any contract, agreement, commitment or other arrangement with the Company
or
any subsidiary or (iii) has entered into any transaction with the Company or
any
subsidiary that would be required to be disclosed under Item 404 of Regulation
S-K.
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3.23 Xxxxxxxx-Xxxxx
Act.
The
Chief Executive Officer and the Chief Financial Officer of the Company have
signed, and the Company has furnished to the SEC, all certifications required
by
Sections 302 and 906 of the Xxxxxxxx-Xxxxx Act of 2002. Such certifications
contain no qualifications or exceptions to the matters certified therein and
have not been modified or withdrawn; and neither the Company nor any of its
officers has received notice from any governmental entity questioning or
challenging the accuracy, completeness, form or manner of filing or submission
of such certifications.
3.24 General
Solicitation.
Neither
the Company nor any other person or entity authorized by the Company to act
on
its behalf has engaged in a general solicitation or general advertising (within
the meaning of Regulation D of the Securities Act) of investors with
respect to offers or sales of the Shares or the Warrants.
3.25 Disclosure.
Neither
this Agreement nor the SEC Documents taken together contain any untrue statement
of a material fact nor omit to state a material fact necessary in order to
make
the statements contained herein or therein, in light of the circumstances under
which they were made, not misleading.
4. Representations,
Warranties and Agreements of the Purchaser.
The
Purchaser represents and warrants to, and agrees with, the Company as
follows:
4.1 Authorization.
The
Purchaser has all requisite power under its constituent documents to enter
into
this Agreement and to carry out and perform its obligations under the terms
of
this Agreement. All action on the part of the Purchaser and, if applicable,
its
officers, directors, stockholders, managers, members and equity holders
necessary for the authorization, execution, delivery and performance of this
Agreement and the consummation of the transactions contemplated herein has
been
taken. When executed and delivered, this Agreement will constitute the legal,
valid, binding and irrevocable obligation of the Purchaser, enforceable against
the Purchaser in accordance with its terms, except as such may be limited by
bankruptcy, insolvency, reorganization or other laws affecting creditors' rights
generally and by general equitable principles.
4.2 Purchase
Entirely for Own Account.
The
Purchaser is acquiring the Shares and the Warrants being purchased by it
hereunder for investment, for its own account, and not for resale or with a
view
to distribution thereof in violation of the Securities Act.
4.3 Investor
Status; Etc.
The
Purchaser certifies and represents to the Company that at the time the Purchaser
acquires any of the Shares or Warrants, the Purchaser will be an "Accredited
Investor"
as
defined in Rule 501 of Regulation D promulgated under the Securities Act and
was
not organized for the purpose of acquiring the Shares or the Warrants. The
Purchaser's financial condition is such that it is able to bear the risk of
holding the Shares, the Warrants or the Warrant Shares for an indefinite period
of time and the risk of loss of its entire investment. The Purchaser has
sufficient knowledge and experience in investing in companies similar to the
Company in terms of the Company's stage of development so as to be able to
evaluate the risks and merits of its investment in the Company. The Purchaser
has received and carefully reviewed this Agreement, the SEC Documents and other
materials relating thereto that the Purchaser has requested. The Purchaser
has
had an opportunity to ask questions of and receive answers from the authorized
representatives of the Company, and to review any relevant documents and records
concerning the business of the Company and the terms and conditions of this
investment, and that any such questions have been answered to the Purchaser's
full satisfaction. No Person other than the Company or its authorized
representatives, has offered the securities to the Purchaser. The Purchaser
is
acquiring the Shares and the Warrants in the ordinary course of business for
the
Purchaser's own account as principal (and not as a nominee or agent), for
investment purposes only, and not with a view to, or for, resale, distribution
or fractionalization thereof, in whole or in part, in any manner in violation
of
applicable United States federal or state securities laws or the rules or
regulations promulgated thereunder. The Purchaser has made no agreement, direct
or indirect, with any other Person regarding any sale, transfer, assignment
or
other disposition of any interest in the Shares, the Warrants or the Warrant
Shares. The Purchaser is aware that, in the view of the SEC and certain state
securities commissions, a purchase of the Shares or the Warrants now with an
intent to resell by reason of any foreseeable specific contingency or
anticipated change in market values or any change in the condition of the
Company, or in connection with a contemplated liquidation or settlement of
any
loan obtained for the acquisition of the Shares, the Warrants or the Warrant
Shares and for which the Shares, the Warrants or the Warrant Shares were pledged
as security, would represent an intent inconsistent with this representation.
The Purchaser further represents and agrees that if, contrary to the foregoing
intentions, the Purchaser should later desire to dispose of or transfer any
of
the Shares, the Warrant Shares or the Warrants in any manner, the Purchaser
shall not do so without first complying with the provisions of Section 6.1.
The
Purchaser understands that no federal or state agency has passed upon or made
any recommendation or endorsement of an investment in the Shares, the Warrant
Shares or the Warrants. The foregoing shall in no way limit or modify the
representations of the Company set forth in Section 3 hereof.
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4.4 Shares
and Warrants Not Registered.
The
Purchaser understands that the Shares and the Warrants have not been registered
under the Securities Act, by reason of their issuance by the Company in a
transaction exempt from the registration requirements of the Securities Act,
and
that the Shares and the Warrants must continue to be held by the Purchaser
unless a subsequent disposition thereof is registered under the Securities
Act
or is exempt from such registration. The Purchaser understands that the
exemptions from registration afforded by Rule 144 (the provisions of which
are
known to it) promulgated under the Securities Act depend on the satisfaction
of
various conditions, and that, if applicable, Rule 144 may afford the basis
for
sales only in limited amounts.
4.5 No
Conflict.
The
execution and delivery of this Agreement by the Purchaser and the consummation
by it of the transactions contemplated hereby will not conflict with or result
in any violation of or default by the Purchaser (with or without notice or
lapse
of time, or both) under (i) any provision of the organizational documents of
the
Purchaser or (ii) any judgment, order, statute, law, ordinance, rule or
regulations, applicable to the Purchaser or its respective properties or
assets.
4.6 Brokers.
The
Purchaser has not retained, utilized or been represented by any broker or finder
in connection with the transactions contemplated by this Agreement.
4.7 Consents.
All
consents, approvals, orders and authorizations required on the part of the
Purchaser in connection with the execution, delivery or performance of this
Agreement and the consummation of the transactions contemplated herein have
been
obtained and are effective as of the Closing Date.
4.8 Agreement
with Respect to Short Sales.
Neither
the Purchaser nor any of its Affiliates nor any person acting on its behalf
will
have entered into for a period of five (5) days prior to the Closing Date,
any
"short sale" (as such term is defined in Rule 3b-3 under the Securities Exchange
Act of 1934, as amended).
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5. Conditions
Precedent.
5.1 Conditions
to the Obligation of the Purchaser to Consummate the Closing.
The
obligation of the Purchaser to consummate the Closing and to purchase and pay
for the Shares and the Warrants being purchased by it pursuant to this Agreement
is subject to the satisfaction of the following conditions precedent (or waiver
by the Purchaser):
(a)
The
representations and warranties contained herein of the Company that are
qualified as to "materiality" shall be true and correct, and the representations
and warranties contained herein of the Company that are not so qualified shall
be true and correct in all material respects, in each case, as of the date
of
this Agreement and as of the Closing Date (except for such representations
and
warranties which are made expressly as of a specified date or period, which
shall be true and correct or true and correct in all material respects, as
herein above required, as of such specified date or period).
(b)
The
Company shall have performed all covenants, agreements, obligations and
conditions herein required to be performed or observed by the Company on or
prior to the Closing Date.
(c)
Prior
to the Closing Date, no event shall have occurred which has had a Material
Adverse Effect shall have occurred.
(d)
No
suit, action, or other proceeding challenging this Agreement or the transactions
contemplated hereby, or seeking to prohibit, alter, prevent or materially delay
the Closing, shall have been instituted before any court, arbitrator or
governmental body, agency or official and shall be pending.
(e)
The
purchase of and payment for the Shares and the Warrants by the Purchaser shall
not be prohibited by any law or governmental order or regulation. All necessary
consents, approvals, licenses, permits, orders and authorizations of, or
registrations, declarations and filings with, any governmental or administrative
agency or of any other person with respect to any of the transactions
contemplated hereby (including, without limitation, the issuance of the Shares,
the Warrants and the Warrant Shares) shall have been duly obtained or made
and
shall be in full force and effect.
(f)
The
Company shall have complied with all applicable requirements of federal and
state securities or "blue sky" laws with respect to the issuance of the Shares
and the Warrants, and the Purchaser, at the Purchaser's request, shall have
been
provided reasonable evidence thereof.
(g)
The
Common Stock of the Company (i) shall be listed on the American Stock Exchange
and (ii) shall not have been suspended from trading on such
exchange.
(h)
A
certificate shall have been delivered by the Company, signed by its Chief
Executive Officer or Chief Financial Officer, dated as of the Closing Date,
certifying as to the fulfillment of the conditions specified in Sections 5.1(a)
and (b).
(i)
A
stock certificate shall have been delivered by the Company representing the
number of shares of Common Stock purchased by the Purchaser and (ii) one or
more
warrants to purchase the shares of Common Stock shall have been delivered by
the
Company, and in each case shall be, registered in the name of the Purchaser
or
nominee as designated by the Purchaser in writing, free of all restrictive
and
other legends (except as provided in Section 6.2 hereof) and against payment
of
the purchase price therefor by wire transfer of immediately available funds
to
such account or accounts as the Company shall designate in writing.
9
(j)
All
instruments and corporate proceedings in connection with the transactions
contemplated by this Agreement to be consummated at the Closing shall be
satisfactory in form and substance to the Purchaser, and the Purchaser shall
have received copies (executed or certified, as may be appropriate) of all
documents which the Purchaser may have reasonably requested in connection with
such transactions.
(k)
No
proceeding challenging this Agreement or the transactions contemplated hereby,
or seeking to prohibit, alter, prevent or materially delay the Closing, shall
have been instituted before any court, arbitrator or governmental body, agency
or official and shall be pending.
(l)
The
Company shall have delivered to the Purchaser a certificate of the Company
executed by the Company's Secretary attaching and certifying to the truth and
correctness of (i) the Company's Certificate of Incorporation, (ii) the
Company's By-laws and (iii) the resolutions adopted by the Company's Board
of
Directors in connection with the transactions contemplated by this
Agreement.
(m)
The
Company shall have delivered to the Purchaser a certificate of the Secretary
of
State of the State of Delaware, dated as of a date within five days of the
date
of the Closing, with respect to the good standing of the Company.
(n)
The
Purchaser will have received an opinion on behalf of the Company, dated as
of
the date of the Closing, from Xxxxxxxxx Xxxxxxx, LLP, counsel to the Company,
in
the form attached as Exhibit A.
5.2 Conditions
to the Obligation of the Company to Consummate the Closing.
The
obligation of the Company to consummate the Closing, to issue and sell to the
Purchaser the Shares and the Warrants to be purchased by it at the Closing
is
subject to the satisfaction of the following conditions precedent (or waiver
by
the Company):
(a)
The
representations and warranties contained herein of the Purchaser shall be true
and correct on and as of the Closing Date with the same force and effect as
though made on and as of the Closing Date (it being understood and agreed by
the
Company that, in the case of any representation and warranty of the Purchaser
contained herein which is not hereinabove qualified by application thereto
of a
materiality standard, such representation and warranty need be true and correct
only in all material respects in order to satisfy as to such representation
or
warranty the condition precedent set forth in the foregoing provisions of this
Section 5.2(a)).
(b)
The
Purchaser shall have performed all obligations and conditions herein required
to
be performed or observed by it on or prior to the Closing Date.
(c)
No
proceeding challenging this Agreement or the transactions contemplated hereby,
or seeking to prohibit, alter, prevent or materially delay the Closing, shall
have been instituted before any court, arbitrator or governmental body, agency
or official and shall be pending.
(d)
The
sale of the Shares and the Warrants by the Company shall not be prohibited
by
any law or governmental order or regulation. All necessary consents, approvals,
licenses, permits, orders and authorizations of, or registrations, declarations
and filings with, any governmental or administrative agency or of any other
person with respect to any of the transactions contemplated hereby shall have
been duly obtained or made and shall be in full force and effect.
(e)
All
instruments and corporate proceedings in connection with the transactions
contemplated by this Agreement to be consummated at the Closing shall be
satisfactory in form and substance to the Company, and the Company shall have
received counterpart originals, or certified or other copies of all documents,
including, without limitation, records of corporate or other proceedings, which
it may have reasonably requested in connection therewith.
10
(f)
Neither the Purchaser nor any of its Affiliates nor any person acting on behalf
of such Persons will have entered into for a period of five days prior to the
Closing Date, any "short sale" (as such term is defined in Section 6.5
hereof).
6. Transfer;
Legends; Future Financings; Short Sales; Board Seat.
6.1 Securities
Law Transfer Restrictions.
The
Purchaser shall not sell, assign, pledge, transfer or otherwise dispose or
encumber any of the Shares, the Warrants, and if applicable, the Warrant Shares,
being purchased by it hereunder, except: (i) pursuant to an effective
registration statement under the Securities Act or (ii) pursuant to an available
exemption from registration under the Securities Act and applicable state
securities laws and, if reasonably requested by the Company, upon delivery
by
the Purchaser of an opinion of counsel reasonably satisfactory to the Company
to
the effect that the proposed transfer is exempt from registration under the
Securities Act and applicable state securities laws. Any transfer or purported
transfer of the Shares, the Warrants, and if applicable, the Warrant Shares,
in
violation of this Section 6.1 shall be voidable by the Company; provided,
however,
that no
opinion will be required in connection with (1) a public sale or transfer of
Shares, the Warrants, and if applicable, the Warrant Shares, pursuant to an
effective registration statement in connection with which the Purchaser
represents in writing to the Company that such Shares, and if applicable,
Warrant Shares, have been or are being sold pursuant to such registration
statement; (2) a public sale of Shares, and if applicable, Warrant Shares
pursuant to Rule 144 under the Securities Act if such Purchaser has delivered
to
the Company a customary and accurate Rule 144 broker's and seller's
representation letter; or (3) a sale of shares pursuant to Rule 144 under the
Securities Act if the Purchaser has delivered to the Company a customary and
accurate Rule 144 seller's representation letter. The Company shall not register
any transfer of the Shares, the Warrants, and if applicable, the Warrant Shares
in violation of this Section 6.1. The Company may, and may instruct any transfer
agent for the Company, to place such stop transfer orders as may be required
on
the transfer books of the Company in order to ensure compliance with the
provisions of this Section 6.1.
6.2 Legends.
Each
certificate representing any of the Shares, the Warrants and, if applicable,
the
Warrant Shares shall be endorsed with a legend in substantially the form set
forth below, and the Purchaser covenants that, except to the extent such
restrictions are waived by the Company, it shall not transfer the securities
represented by any such certificate without complying with the restrictions
on
transfer described in this Agreement and the legends endorsed on such
certificate:
THE
SECURITIES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN REGISTERED UNDER THE
SECURITIES ACT OF 1933, AS AMENDED (THE "ACT"), OR THE SECURITIES LAWS OF ANY
STATE AND MAY ONLY BE OFFERED, SOLD, ASSIGNED, PLEDGED, TRANSFERRED OR OTHERWISE
DISPOSED OF PURSUANT TO (I) AN EFFECTIVE REGISTRATION STATEMENT UNDER THE ACT
AND SUCH LAWS OR (II) AN EXEMPTION FROM REGISTRATION UNDER SAID ACT, AND TO
THE
EXTENT PERMITTED BY SECTION 6.1 OF THE SECURITIES PURCHASE AGREEMENT PURSUANT
TO
WHICH THE SECURITIES REPRESENTED HEREBY WERE ACQUIRED, UPON DELIVERY OF AN
OPINION OF COUNSEL REASONABLY SATISFACTORY TO THE COMPANY THAT THE PROPOSED
TRANSFER IS EXEMPT FROM THE ACT AND SUCH LAWS.
11
6.3 Removal
of Legends.
Any
legend endorsed on a certificate evidencing the Shares and, if applicable,
the
Warrant Shares shall be removed, and the Company shall issue a certificate
without such legend to the holder of such Shares and, if applicable, the Warrant
Shares if such Shares and, if applicable, the Warrant Shares will be sold (i)
pursuant to an effective registration statement under the Securities Act or
pursuant to Rule 144 promulgated thereunder, (ii) at any time the Shares and,
if
applicable, the Warrant Shares become eligible for sale under Rule 144 under
the
Securities Act or (iii) if, in the opinion of counsel, such legends are no
longer required under applicable requirements of the Securities Act, and the
purchaser thereof may immediately resell such Shares and, if applicable, Warrant
Shares without restriction and without registration; provided,
however,
that in
the case of a sale pursuant to Rule 144, such holder of Shares and, if
applicable, Warrant Shares shall provide such information as is reasonably
requested by the Company to ensure that such Shares and, if applicable, the
Warrant Shares may be sold in reliance on Rule 144.
6.4 Participation
in Future Financings.
(a) From
the
date hereof until the date that is 36 months after the Closing, upon any
issuance by the Company of its equity or equity-linked securities for cash
consideration in a financing transaction (a "Subsequent
Financing"),
the
Purchaser shall have the right to participate in up to an amount of the
Subsequent Financing equal to 100% of the Subsequent Financing (the
"Participation
Maximum")
on the
same terms, conditions and price provided for in the Subsequent Financing.
(b) At
least
ten business days prior to the closing of the Subsequent Financing, the Company
shall deliver to the Purchaser a written notice of its intention to effect
a
Subsequent Financing ("Pre-Notice"),
which
Pre-Notice shall ask the Purchaser if it wants to review the details of such
financing (such additional notice, a "Subsequent
Financing Notice").
Upon
the request of the Purchaser, and only upon a request by the Purchaser, for
a
Subsequent Financing Notice, the Company shall promptly, but no later than
one
business day after such request, deliver a Subsequent Financing Notice to the
Purchaser. The Subsequent Financing Notice shall describe in reasonable detail
the proposed terms of such Subsequent Financing, the amount of proceeds intended
to be raised thereunder, the Person or Persons through or with whom such
Subsequent Financing is proposed to be effected, and attached to which shall
be
a term sheet or similar document relating thereto.
(c) The
Purchaser, desiring to participate in such Subsequent Financing, must provide
written notice to the Company by not later than 5:00 p.m. (New York time) on
the
tenth business day after the Purchaser has received the Pre-Notice that the
Purchaser is willing to participate in the Subsequent Financing, the amount
of
the Purchaser’s participation, and that the Purchaser has such funds ready,
willing and available for investment on the terms set forth in the Subsequent
Financing Notice. If the Company receives no notice from the Purchaser as of
such fifth business day, the Purchaser shall be deemed to have notified the
Company that it does not elect to participate.
(d) If
by
5:00 p.m. (New York time) on the tenth business day after the Purchaser has
received the Pre-Notice, notification by the Purchaser of its willingness to
participate in the Subsequent Financing (or to cause its designees to
participate) is, in the aggregate, less than the total amount of the Subsequent
Financing, then the Company may effect the remaining portion of such Subsequent
Financing on the terms and with the Persons set forth in the Subsequent
Financing Notice.
(e) The
Company must provide the Purchaser with a second Subsequent Financing Notice,
and the Purchaser will again have the right of participation set forth above
in
this Section 6.4, if the Subsequent Financing subject to the initial Subsequent
Financing Notice is not consummated for any reason on the terms set forth in
such Subsequent Financing Notice within 90 calendar days after the date of
the
initial Subsequent Financing Notice.
12
(f) Notwithstanding
the foregoing, this Section 6.4 shall not apply in respect of issuances
of Common Stock in connection with strategic partnerships, mergers and
acquisitions, and public
offerings.
6.5 Short
Sales.
The
Purchaser covenants that neither it nor any Affiliate acting on its behalf
or
pursuant to any understanding with it will execute any Short Sales (as defined
below) during the period commencing on the date hereof and ending 12 months
after the Closing. For purposes of this Section 6.5, “Short
Sales”
means
“short sales,” as defined in Rule 200 of Regulation SHO under the Exchange Act
(but shall not be deemed to include the location and/or reservation of
borrowable shares of Common Stock).
6.6 Board
Seat.
The
Purchaser shall have the right, for a period of three years after the Closing,
to designate two persons to be a nominees for directors of the Company. One
of
the Purchaser’s nominees will be Xxxxxxx X. Xxxxxxx, Xx. The other Purchaser’s
nominee will be an independent industry expert that is reasonably acceptable
to
the Company. The Company shall, and shall cause its existing directors to,
use
best efforts (which shall include, without limitation, the solicitation of
proxies on behalf of such nominee at any meeting of stockholders for the
election of directors) to elect such nominees to the Board of Directors
immediately following the Closing. The Board of Directors shall consist of
not
more than nine directors. Such nominees shall receive reimbursement of
reasonable expenses and such compensation for attending meetings equal to the
compensation received by any outside director. The Company agrees to indemnify
and hold the Purchaser harmless against any and all claims, actions, awards
and
judgments arising solely out of the attendance and participation of the
Purchaser’s designated nominees at any such meeting. In the event the Company
maintains a liability insurance policy affording coverage for the acts of its
officers and directors, it agrees, if possible, to include the Purchaser’s
designated nominees as insured under such policy.
7. Termination;
Liabilities Consequent Thereon.
This
Agreement may be terminated and the transactions contemplated hereunder
abandoned at any time prior to the Closing only as follows:
(a)
with
respect to the Purchaser, by the Purchaser, upon notice to the Company if the
conditions set forth in Section 5.1 shall not have been satisfied on or prior
to
March 31, 2008; or
(b)
with
respect to the Purchaser, by the Company, upon notice to the Purchaser if the
conditions set forth in Section 5.2 to be satisfied by the Purchaser shall
not
have been satisfied on or prior to March 14, 2008; or
(c)
at
any time by mutual agreement of the Company and the Purchaser; or
(d)
with
respect to the Purchaser, by the Purchaser, if there has been any breach of
any
representation or warranty or any material breach of any covenant of the Company
contained herein and the same has not been cured within 15 days after notice
thereof (it being understood and agreed by the Purchaser that, in the case
of
any representation or warranty of the Company contained herein which is not
hereinabove qualified by application thereto of a materiality standard, such
representation or warranty will be deemed to have been breached for purposes
of
this Section 7.1(d) only if such representation or warranty was not true and
correct in all material respects at the time such representation or warranty
was
made by the Company); or
(e)
by
the Company with respect to the Purchaser, if there has been any breach of
any
representation, warranty or any material breach of any covenant of the Purchaser
contained herein and the same has not been cured within 15 days after notice
thereof (it being understood and agreed by the Company that, in the case of
any
representation and warranty of the Purchaser contained herein which is not
hereinabove qualified by application thereto of a materiality standard, such
representation or warranty will be deemed to have been breached for purposes
of
this Section 7.1(e) only if such representation or warranty was not true and
correct in all material respects at the time such representation or warranty
was
made by the Purchaser).
13
Any
termination pursuant to this Section 7 shall be without liability on the part
of
any party, unless such termination is the result of a material breach of this
Agreement by a party to this Agreement in which case such breaching party shall
remain liable for such breach notwithstanding any termination of this
Agreement.
8. Miscellaneous
Provisions.
8.1 Use
of
Proceeds.
The
Company shall use the net proceeds from the sale of the Shares and Warrants
for
working capital and other growth initiatives.
8.2 Filings.
The
Company shall make all necessary filings with the SEC and "blue sky" filings
required to be made by the Company in connection with the sale of the Shares
and, if applicable, the Warrant Shares to the Purchaser as required by all
applicable laws, and shall provide a copy thereof to the Purchaser promptly
after such filing.
8.3 Public
Statements or Releases.
Each of
the parties to this Agreement agrees that it shall not make, issue, or release
any announcement, whether to the public generally, or to any of its suppliers
or
customers, with respect to this Agreement or the transactions provided for
herein, or make any statement or acknowledgment of the existence of, or reveal
the status of, this Agreement or the transactions provided for herein, without
the prior consent of the other parties, which shall not be unreasonably withheld
or delayed. Notwithstanding the foregoing, nothing in this Section 8.3 shall
prevent any party hereto from making such public announcements or filings as
it
may consider necessary in order to satisfy its legal obligations, or from
releasing a public statement acceptable to each of the parties hereto upon
the
completion of the offering contemplated hereby. Notwithstanding the foregoing,
as soon as possible but not later than 9:30 a.m. (New York time) on the first
business day following the Closing Date, the Company will issue a press release
in accordance with applicable law describing the transactions contemplated
by
this Agreement, and promptly thereafter file a Current Report on Form 8-K with
the SEC, attaching such press release.
8.4 Further
Assurances.
The
parties agree to cooperate fully to execute such further instruments, documents
and agreements and to give such further written assurances, as may be reasonably
requested by any party to better evidence and reflect the transactions described
herein and contemplated hereby, and to carry into effect the intents and
purposes of this Agreement.
8.5 Rights
Cumulative.
Each
and all of the various rights, powers and remedies of the parties hereto shall
be considered to be cumulative with and in addition to any other rights, powers
and remedies which such parties may have at law or in equity in the event of
the
breach of any of the terms of this Agreement. The exercise or partial exercise
of any right, power or remedy shall neither constitute the exclusive election
thereof nor the waiver of any other right, power or remedy available to such
party.
14
8.6 Notices.
(a)
Any
notices, reports or other correspondence (hereinafter collectively referred
to
as "Correspondence")
required or permitted to be given hereunder shall be sent by postage prepaid
first class mail, courier or facsimile or delivered by hand to the party to
whom
such Correspondence is required or permitted to be given hereunder. The date
of
giving any notice shall be the date of its actual receipt.
(b)
All
Correspondence to the Company shall be addressed as follows:
Debt
Resolve, Inc.
000
Xxxxxxxxxxx Xxxxxx, Xxxxx X0
Xxxxx
Xxxxxx, Xxx Xxxx 00000
Attention:
Xx. Xxxxxxx X. Xxxxxxxxxx
Chief
Executive Officer
Facsimile:
(000) 000-0000
with
a
copy to:
Xxxxxxxxx
Traurig, LLP
MetLife
Building
000
Xxxx
Xxxxxx, 00xx
Xxxxx
Xxx
Xxxx,
Xxx Xxxx 00000
Attention:
Xxxxxxx X. Xxxxxxx, Esq.
Facsimile:
(000) 000-0000
(c)
All
Correspondence to the Purchaser shall be addressed as follows:
Harmonie
International, LLC
00000
Xxxxxxx Xxxx Xxxx, Xxxxx 000
Xxxxxxxxxx
Xxxx, Xxxxxxxx 00000
Attention: Xx.
Xxxxxxx X. Xxxxxxx, Xx.
Chairman
and Chief Executive Officer
Facsimile: (000)
000-0000
with
a
copy to:
XxXxxxx
Long & Xxxxxxxx, LLP
0000
X
Xxxxxx X.X.
Xxxxxxxxxx,
X.X. 00000-0000
Attention:
Xxx X. Xxxxxxx, Esq.
Facsimile:
(000) 000-0000
(d)
Any
Person may change the address to which correspondence to it is to be addressed
by notification as provided for herein.
8.7 Captions.
The
captions and paragraph headings of this Agreement are solely for the convenience
of reference and shall not affect its interpretation.
15
8.8 Severability.
Should
any part or provision of this Agreement be held unenforceable or in conflict
with the applicable laws or regulations of any jurisdiction, the invalid or
unenforceable part or provisions shall be replaced with a provision which
accomplishes, to the extent possible, the original business purpose of such
part
or provision in a valid and enforceable manner, and the remainder of this
Agreement shall remain binding upon the parties hereto.
8.9 Governing
Law; Injunctive Relief.
(a)
This
Agreement shall be governed by and construed and enforced in accordance with
the
internal and substantive laws of the State of New York and without regard to
any
conflicts of laws concepts that would apply the substantive law of any other
jurisdiction.
(b)
Each
of the parties hereto acknowledges and agrees that damages will not be an
adequate remedy for any material breach or violation of this Agreement if such
material breach or violation would cause immediate and irreparable harm (an
“Irreparable
Breach”).
Accordingly, in the event of a threatened or ongoing Irreparable Breach, each
party hereto shall be entitled to seek, in any state or federal court in the
State of New York, equitable relief of a kind appropriate in light of the nature
of the ongoing or threatened Irreparable Breach, which relief may include,
without limitation, specific performance or injunctive relief; provided,
however,
that if
the party bringing such action is unsuccessful in obtaining the relief sought,
the moving party shall pay the non-moving party's costs, including actual
attorney's fees, incurred in connection with defending such action. Such
remedies shall not be the parties' exclusive remedies, but shall be in addition
to all other remedies provided in this Agreement.
8.10 Waiver.
No
waiver of any term, provision or condition of this Agreement, whether by conduct
or otherwise, in any one or more instances, shall be deemed to be, or be
construed as, a further or continuing waiver of any such term, provision or
condition or as a waiver of any other term, provision or condition of this
Agreement.
8.11 Fees,
Costs and Expenses.
All
fees, costs and expenses (including attorneys' fees and expenses) incurred
by
any party hereto in connection with the preparation, negotiation and execution
of this Agreement and the exhibits hereto and the consummation of the
transactions contemplated hereby and thereby (including the costs associated
with any filings with, or compliance with any of the requirements of, any
governmental authorities), shall be the sole and exclusive responsibility of
such party.
8.12 Assignment.
The
rights and obligations of the parties hereto shall inure to the benefit of
and
shall be binding upon the authorized successors and permitted assigns of each
party. The Company shall not assign this Agreement or any rights or obligations
hereunder without the prior written consent of the Purchaser. The Purchaser
may
assign its rights under this Agreement to any person to whom the Purchaser
assigns or transfers any Shares, Warrants, and, if applicable, Warrant Shares
provided that such transferee agrees in writing to be bound by the terms and
provisions of this Agreement, and such transfer is in compliance with the terms
and provisions of this Agreement and permitted, with the approval of counsel
to
the Company, by federal and state securities laws.
8.13 Survival.
The
respective representations and warranties given by the parties hereto, and
the
other covenants and agreements contained herein, shall survive the Closing
Date
and the consummation of the transactions contemplated herein for a period of
one
year, without regard to any investigation made by any party.
16
8.14 Entire
Agreement.
This
Agreement and exhibits attached hereto and incorporated herewith constitute
the
entire agreement between the parties hereto respecting the subject matter hereof
and supersedes all prior agreements, negotiations, understandings,
representations and statements respecting the subject matter hereof, whether
written or oral.
8.15 Amendments.
No
modification, alteration, waiver or change in any of the terms of this Agreement
shall be valid or binding upon the parties hereto unless made in writing and
duly executed by the Company and the Purchaser.
8.16 Confidential
Information.
Each of
the Company and the Purchaser agrees to keep confidential, and not to disclose
to or use for the benefit of any third party, the terms of this Agreement or
any
other information which at any time is communicated by the other party as being
confidential, without the prior written approval of the other party;
provided,
however,
that
this provision shall not apply to information which, at the time of disclosure,
is already part of the public domain (except by breach of this Agreement) and
information which is required to be disclosed by law (including, without
limitation, pursuant to Item 601(b)(10) of Regulation S-K under the Securities
Act and the Exchange Act) and provided further the Company will not furnish
confidential information to a Purchaser without (i) informing the Purchaser
regarding the nature of such information and (ii) receiving the prior express
written agreement of the Purchaser. Notwithstanding anything herein to the
contrary, any party to this Agreement (and any employee, representative, or
other agent of any party to this Agreement) may disclose to any and all persons,
without limitation of any kind, the tax treatment and tax structure of the
transactions contemplated by this Agreement and all materials of any kind
(including opinions or other tax analyses) that are provided to it relating
to
such tax treatment and tax structure. However, any such information relating
to
the tax treatment or tax structure is required to be kept confidential to the
extent necessary to comply with any applicable federal or state securities
laws.
8.17 Stock
Splits, Dividends and other Similar Events.
The
provisions of this Agreement shall be appropriately adjusted to reflect any
stock split, stock dividend, reorganization or other similar event that may
occur with respect to the Company after the date hereof.
8.18 Counterparts.
This
Agreement may be executed simultaneously in two or more counterparts, each
of
which shall be deemed an original, but all of which together shall constitute
one and the same instrument.
[THE
REMAINDER OF THIS PAGE HAS BEEN INTENTIONALLY LEFT BLANK;
SIGNATURE
PAGE FOLLOWS.]
17
IN
WITNESS WHEREOF, the parties hereto have executed this Securities Purchase
Agreement as of the day and year first above written.
| DEBT RESOLVE, INC. | ||
| |
|
|
| By: |
/s/ Xxxxx
X. Xxxxxxxxx
|
|
|
Name: Xxxxx
X. Xxxxxxxxx
Title:
Chairman
|
||
| HARMONIE INTERNATIONAL, LLC | ||
| |
|
|
| By: |
/s/
Xxxxxxx
X. Xxxxxxx, Xx.
|
|
|
Name:
Xxxxxxx
X. Xxxxxxx, Xx.
Title:
Chairman
/ CEO
|
||
18
