SECURITIES PURCHASE AGREEMENT
This Securities Purchase Agreement (this "AGREEMENT") is dated as of
March 24, 2004, among Infocrossing, Inc., a Delaware corporation (the
"COMPANY"), and the purchasers identified on the signature pages hereto (each, a
"PURCHASER" and collectively, the "PURCHASERS").
WHEREAS, subject to the terms and conditions set forth in this
Agreement and pursuant to Section 4(2) of the Securities Act (as defined below)
and Rule 506 promulgated thereunder, the Company desires to issue and sell to
the Purchasers, and the Purchasers, severally and not jointly, desire to
purchase from the Company certain securities of the Company, as more fully
described in this Agreement.
NOW, THEREFORE, IN CONSIDERATION of the mutual covenants contained in
this Agreement, and for other good and valuable consideration the receipt and
adequacy of which are hereby acknowledged, the Company and the Purchasers agree
as follows:
ARTICLE I.
DEFINITIONS
1.1 Definitions. In addition to the terms defined elsewhere in this Agreement,
for all purposes of this Agreement, the following terms shall have the meanings
indicated in this Section 1.1:
"ACTION" means any action, suit, inquiry, notice of violation,
proceeding (including any partial proceeding such as a deposition) or
investigation pending or threatened against or affecting the Company in a
writing delivered to the Company or such Subsidiary (as the case may be), any
Subsidiary or any of their respective properties before or by any court,
arbitrator, governmental or administrative agency, regulatory authority
(federal, state, county, local or foreign), stock market, stock exchange or
trading facility.
"AFFILIATE" means any Person that, directly or indirectly
through one or more intermediaries, controls or is controlled by or is under
common control with a Person, as such terms are used in and construed under Rule
144.
"BUSINESS DAY" means any day except Saturday, Sunday and any
day which shall be a federal legal holiday or a day on which banking
institutions in the State of New York are authorized or required by law or other
governmental action to close.
"CLOSING" means the closing of the purchase and sale of the
Shares pursuant to Article II.
"CLOSING DATE" means the second Business Day after the
satisfaction or waiver of the conditions to Closing set forth in Sections 5.1
and 5.2.
"COMMISSION" means the Securities and Exchange Commission.
"COMMON STOCK" means the common stock of the Company, $0.01
par value per share, and any securities into which such common stock may
hereafter be reclassified.
"COMPANY COUNSEL" means Xxxxxx & Xxxxxxx LLP.
"DISCLOSURE MATERIALS" has the meaning set forth in Section
3.1(h).
"EFFECTIVE DATE" means the date that the Registration
Statement required by Section 2(a) of the Registration Rights Agreement is first
declared effective by the Commission.
"ESCROW AGENT" means the Escrow Agent under the Escrow
Agreement.
"ESCROW AGREEMENT" means the Escrow Agreement, dated as of the
date of this Agreement, among the Company, Xxxx Capital Partners, LLC and the
Escrow Agent.
"EXCHANGE ACT" means the Securities Exchange Act of 1934, as
amended.
"INVESTMENT AMOUNT" means, with respect to each Purchaser, the
investment amount indicated below such Purchaser's name on the signature page of
this Agreement.
"LIEN" means any lien, charge, encumbrance, security interest
or right of first refusal.
"PER SHARE PURCHASE PRICE" equals $10.50.
"PERSON" means an individual or corporation, partnership,
trust, incorporated or unincorporated association, joint venture, limited
liability company, joint stock company, government (or an agency or subdivision
thereof) or other entity of any kind.
"PROCEEDING" means an action, claim, suit, investigation or
proceeding (including, without limitation, an investigation or partial
proceeding, such as a deposition), whether commenced or threatened.
"REGISTRATION STATEMENT" means a registration statement
meeting the requirements set forth in the Registration Rights Agreement and
covering the resale by the Purchasers of the Shares.
"REGISTRATION RIGHTS AGREEMENT" means the Registration Rights
Agreement, dated as of the date of this Agreement, among the Company and the
Purchasers, in the form of Exhibit B.
"RULE 144" means Rule 144 promulgated by the Commission
pursuant to the Securities Act, as such Rule may be amended from time to time,
or any similar rule or regulation hereafter adopted by the Commission having
substantially the same effect as such Rule.
"SEC REPORTS" has the meaning set forth in Section 3.1(h).
"SECURITIES ACT" means the Securities Act of 1933, as amended.
"SHARES" means the shares of Common Stock issued or issuable
to the Purchasers at the Closing.
"SUBSIDIARY" means any "significant subsidiary" as defined in
Rule 1-02(w) of the Regulation S-X promulgated by the Commission under the
Exchange Act.
"TRADING DAY" means (i) a day on which the Common Stock is
traded on a Trading Market, or (ii) if the Common Stock is not listed on a
Trading Market, a day on which the Common Stock is traded in the
over-the-counter market, as reported by the OTC Bulletin Board or the National
Quotation Bureau Incorporated, or (iii) if the Common Stock is not quoted on the
OTC Bulletin Board, a day on which the Common Stock is quoted in the
over-the-counter market as reported by the National Quotation Bureau
Incorporated (or any similar organization or agency succeeding to its functions
of reporting prices); provided, that in the event that the Common Stock is not
listed or quoted as set forth in (i), (ii) and (iii) hereof, then Trading Day
shall mean a Business Day.
"TRADING MARKET" means whichever of the New York Stock
Exchange, the American Stock Exchange, the NASDAQ National Market or the NASDAQ
SmallCap Market, on which the Common Stock is listed or quoted for trading on
the date in question.
"TRANSACTION DOCUMENTS" means this Agreement, the Registration
Rights Agreement, the Escrow Agreement and any other documents or agreements
executed in connection with the transactions contemplated hereunder.
ARTICLE II.
PURCHASE AND SALE
2.1 Purchase of Shares; Closing. Subject to the terms and conditions set forth
in this Agreement, at the Closing the Company shall issue and sell to each
Purchaser, and each Purchaser shall, severally and not jointly, purchase from
the Company, the Shares representing such Purchaser's Investment Amount. The
Closing shall take place on the Closing Date at the offices of Xxxxx Xxxx LLP,
0000 Xxxxxx xx xxx Xxxxxxxx, Xxx Xxxx, XX 00000 or at such other location as the
parties may agree.
2.2 Closing Deliveries. (a) At the Closing, the Company shall deliver or cause
to be delivered to each Purchaser the following (collectively, the "COMPANY
DELIVERABLES"):
(i) a certificate evidencing a number of Shares equal to such Purchaser's
Investment Amount divided by the Per Share Purchase Price, registered in the
name of such Purchaser, or such nominee name as designated by Purchaser;
(ii) the legal opinion of Company Counsel, in agreed form, addressed to the
Purchasers; and
(iii) the Registration Rights Agreement and the Escrow Agreement, each duly
executed by the Company.
(b) At the Closing, each Purchaser shall deliver or cause to be delivered the
following:
(i) such Purchaser's Investment Amount, which shall have been deposited in
accordance with Section 4.11 and which will be distributed in accordance with
the Escrow Agreement; and
(ii) the Registration Rights Agreement, duly executed by such Purchaser.
ARTICLE III.
REPRESENTATIONS AND WARRANTIES
3.1 Representations and Warranties of the Company. The Company hereby makes the
following representations and warranties to each Purchaser:
(a) Subsidiaries. The Company has no direct or indirect Subsidiaries other than
those listed in Schedule 3.1(a). Except as disclosed in Schedule 3.1(a), the
Company owns, directly or indirectly, all of the capital stock of each
Subsidiary free and clear of any and all Liens, and all the issued and
outstanding shares of capital stock of each Subsidiary are validly issued and
are fully paid, non-assessable and free of preemptive and similar rights.
(b) Organization and Qualification. Each of the Company and each Subsidiary is
an entity duly incorporated or otherwise organized, validly existing and in good
standing under the laws of the jurisdiction of its incorporation or organization
(as applicable), with the requisite power and authority to own and use its
properties and assets and to carry on its business as currently conducted.
Neither the Company nor any Subsidiary is in violation of any of the provisions
of its respective certificate or articles of incorporation, bylaws or other
organizational or charter documents. Each of the Company and each Subsidiary is
duly qualified to conduct business and is in good standing as a foreign
corporation or other entity in each jurisdiction in which the nature of the
business conducted or property owned by it makes such qualification necessary,
except where the failure to be so qualified or in good standing, as the case may
be, would not, individually or in the aggregate, have or reasonably be expected
to result in (i) an adverse effect on the legality, validity or enforceability
of any Transaction Document, (ii) a material and adverse effect on the results
of operations, assets, prospects, business or condition (financial or otherwise)
of the Company and the Subsidiaries, taken as a whole, or (iii) a material
adverse impairment to the Company's ability to perform on a timely basis its
obligations under any Transaction Document (any of (i), (ii) or (iii), a
"MATERIAL ADVERSE EFFECT").
(c) Authorization; Enforcement. The Company has the requisite corporate power
and authority to enter into and to consummate the transactions contemplated by
each of the Transaction Documents and otherwise to carry out its obligations
thereunder. The execution and delivery of each of the Transaction Documents by
the Company and the consummation by it of the transactions contemplated thereby
have been duly authorized by all necessary action on the part of the Company and
no further action is required by the Company in connection therewith. Each
Transaction Document has been (or upon delivery will have been) duly executed by
the Company and, when delivered in accordance with the terms hereof, will
constitute the valid and binding obligation of the Company enforceable against
the Company in accordance with its terms, except as such enforceability may be
limited by applicable bankruptcy, insolvency, reorganization, moratorium,
liquidation or similar laws relating to, or affecting generally the enforcement
of, creditors' rights and remedies or by other equitable principles of general
application and as any rights to indemnity or contribution thereunder may be
limited by public policy considerations.
(d) No Conflicts. The execution, delivery and performance of the Transaction
Documents by the Company and the consummation by the Company of the transactions
contemplated thereby do not and will not (i) conflict with or violate any
provision of the Company's or any Subsidiary's certificate or articles of
incorporation, bylaws or other organizational or charter documents, or (ii)
conflict with, or constitute a default (or an event that with notice or lapse of
time or both would become a default) under, or give to others any rights of
termination, amendment, acceleration or cancellation (with or without notice,
lapse of time or both) of, any agreement, credit facility, debt or other
instrument (evidencing a Company or Subsidiary debt or otherwise) or other
understanding to which the Company or any Subsidiary is a party or by which any
property or asset of the Company or any Subsidiary is bound or affected, or
(iii) result in a violation of any law, rule, regulation, order, judgment,
injunction, decree or other restriction of any court or governmental authority
to which the Company or a Subsidiary is subject (including federal and state
securities laws and regulations), or by which any property or asset of the
Company or a Subsidiary is bound or affected; except in the case of each of
clauses (ii) and (iii), such as would not, individually or in the aggregate,
have or reasonably be expected to result in a Material Adverse Effect.
(e) Filings, Consents and Approvals. The Company is not required to obtain any
consent, waiver, authorization or order of, give any notice to, or make any
filing or registration with, any court or other federal, state, local or other
governmental authority or other Person in connection with the execution,
delivery and performance by the Company of the Transaction Documents, other than
(i) the filing with the Commission of one or more Registration Statements in
accordance with the requirements Registration Rights Agreement or the filing of
a Form D with the Commission, (ii) any filings required by state securities
laws, (iii) the filings required in accordance with Section 4.5, and (iv) those
that have been made or obtained prior to or as of the date of this Agreement.
(f) Issuance of the Shares. The Shares have been duly authorized and, when
issued and paid for in accordance with this Agreement, will be duly and validly
issued, fully paid and nonassessable, free and clear of all Liens.
(g) Capitalization. The number of shares and type of all authorized, issued and
outstanding capital stock of the Company, and all shares of Common Stock
reserved for issuance under the Company's various option and incentive plans, is
set forth in Schedule 3.1(g). Except as set forth in Schedule 3.1(g), no
securities of the Company are entitled to preemptive or similar rights, and no
Person has any right of first refusal, preemptive right, right of participation,
or any similar right to participate in the transactions contemplated by the
Transaction Documents. Except as a result of the purchase and sale of the Shares
and except as disclosed in Schedule 3.1(g), there are no outstanding options,
warrants, scrip rights to subscribe to, calls or commitments of any character
whatsoever relating to, or securities, rights or obligations convertible into or
exchangeable for, or giving any Person any right to subscribe for or acquire,
any shares of Common Stock, or contracts, commitments, understandings or
arrangements by which the Company or any Subsidiary is or may become bound to
issue additional shares of Common Stock, or securities or rights convertible or
exchangeable into shares of Common Stock. Except as set forth in Schedule
3.1(g), the issue and sale of the Shares will not, immediately or with the
passage of time, obligate the Company to issue shares of Common Stock or other
securities to any Person (other than the Purchasers) and will not result in a
right of any holder of Company securities to adjust the exercise, conversion,
exchange or reset price under such securities.
(h) SEC Reports; Financial Statements. The Company has filed all reports
required to be filed by it under the Securities Act and the Exchange Act,
including pursuant to Section 13(a) or 15(d) thereof, for the twelve months
preceding the date hereof (the foregoing materials being collectively referred
to herein as the "SEC REPORTS" and, together with the Schedules to this
Agreement, the "DISCLOSURE MATERIALS") on a timely basis or has timely filed a
valid extension of such time of filing and has filed any such SEC Reports prior
to the expiration of any such extension. As of their respective dates, the SEC
Reports complied in all material respects with the requirements of the
Securities Act and the Exchange Act and the rules and regulations of the
Commission promulgated thereunder, and none of the SEC Reports, when filed,
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
therein, in light of the circumstances under which they were made, not
misleading. The financial statements of the Company included in the SEC Reports
comply in all material respects with applicable accounting requirements and the
rules and regulations of the Commission with respect thereto as in effect at the
time of filing. Such financial statements have been prepared in accordance with
generally accepted accounting principles applied on a consistent basis during
the periods involved ("GAAP"), except as may be otherwise specified in such
financial statements or the notes thereto, and fairly present in all material
respects the financial position of the Company and its consolidated Subsidiaries
as of and for the dates thereof and the results of operations and cash flows for
the periods then ended, in each case in accordance with GAAP, subject, in the
case of unaudited statements, to normal, nonrecurring, year-end audit
adjustments.
(i) Press Releases. The press releases disseminated by the Company during the
one (1) year preceding the date of this Agreement taken as a whole do 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.
(j) Material Changes. Since the date of the latest audited financial statements
included within the SEC Reports, except as specifically disclosed in the SEC
Reports, (i) there has been no event, occurrence or development that has had or
that would have or reasonably be expected to result in a Material Adverse
Effect, (ii) the Company has not incurred any liabilities (contingent or
otherwise) other than (A) trade payables and accrued expenses incurred in the
ordinary course of business consistent with past practice and (B) liabilities
not required to be reflected in the Company's financial statements pursuant to
GAAP or required to be disclosed in filings made with the Commission, (iii) the
Company has not adopted material changes in accounting principles or changed its
auditors, (iv) the Company has not declared or made any dividend or distribution
of cash or other property to its stockholders or purchased, redeemed or made any
agreements to purchase or redeem any shares of its capital stock, and (v) the
Company has not issued any equity securities to any officer, director or
Affiliate, except pursuant to existing Company stock option plans. The Company
does not have pending before the Commission any request for confidential
treatment of information.
(k) Litigation. There is no Action which (i) adversely affects or challenges the
legality, validity or enforceability of any of the Transaction Documents or the
Shares or (ii) would, if there were an unfavorable decision, individually or in
the aggregate, have or reasonably be expected to result in a Material Adverse
Effect. Neither the Company nor any Subsidiary, nor any director or officer
thereof, is or has been the subject of any Action involving a claim of violation
of or liability under federal or state securities laws or a claim of breach of
fiduciary duty. There has not been, and to the knowledge of the Company, there
is not pending or contemplated, any investigation by the Commission involving
the Company or any current or former director or officer of the Company. The
Commission has not issued any stop order or other order suspending the
effectiveness of any registration statement filed by the Company or any
Subsidiary under the Exchange Act or the Securities Act.
(l) Labor Relations. No material labor dispute exists or, to the knowledge of
the Company, is imminent with respect to any of the employees of the Company
which would have or reasonably be expected to result in a Material Adverse
Effect.
(m) Compliance. Neither the Company nor any Subsidiary (i) is in default under
or in violation of (and no event has occurred that has not been waived that,
with notice or lapse of time or both, would result in a default by the Company
or any Subsidiary under), nor has the Company or any Subsidiary received notice
of a claim that it is in default under or that it is in violation of, any
indenture, loan or credit agreement or any other agreement or instrument to
which it is a party or by which it or any of its properties is bound (whether or
not such default or violation has been waived), (ii) is in violation of any
order of any court, arbitrator or governmental body, or (iii) is or has been in
violation of any statute, rule or regulation of any governmental authority,
including without limitation all foreign, federal, state and local laws relating
to taxes, environmental protection, occupational health and safety, product
quality and safety and employment, labor matters and gaming matters, except in
each case as would not, individually or in the aggregate, have or reasonably be
expected to result in a Material Adverse Effect. The Company is in compliance
with the applicable requirements of the Xxxxxxxx-Xxxxx Act of 2002 and the rules
and regulations thereunder promulgated by the Commission, except where such
noncompliance would not have or reasonably be expected to result in a Material
Adverse Effect and except that the Company does not currently have a financial
expert on its audit committee.
(n) Regulatory Permits. The Company and the Subsidiaries possess all
certificates, authorizations and permits issued by the appropriate federal,
state, local or foreign regulatory authorities necessary to conduct their
respective businesses as described in the SEC Reports, except where the failure
to possess such permits would not, individually or in the aggregate, have or
reasonably be expected to result in a Material Adverse Effect ("MATERIAL
PERMITS"), and neither the Company nor any Subsidiary has received any notice of
proceedings relating to the revocation or modification of any Material Permit.
(o) Title to Assets. The Company and the Subsidiaries have good and marketable
title in fee simple to all real property owned by them that is material to their
respective businesses and good and marketable title in all personal property
owned by them that is material to their respective businesses, in each case free
and clear of all Liens, except for Liens as do not materially affect the value
of such property and do not materially interfere with the use made and proposed
to be made of such property by the Company and the Subsidiaries or Liens
pursuant to the Term Loan Agreement, dated October 21, 2003, among the Company,
the Lenders named therein and Infocrossing Agent, Inc., as Agent. Any real
property and facilities held under lease by the Company and the Subsidiaries are
held by them under valid, subsisting and enforceable leases of which the Company
and the Subsidiaries are in compliance, except as would not, individually or in
the aggregate, have or reasonably be expected to result in a Material Adverse
Effect.
(p) Patents and Trademarks. The Company and the Subsidiaries have, or have
rights to use, all patents, patent applications, trademarks, trademark
applications, service marks, trade names, copyrights, licenses and other similar
rights that are necessary or material for use in connection with their
respective businesses as described in the SEC Reports and which the failure to
so have would not, individually or in the aggregate, have or reasonably be
expected to result in a Material Adverse Effect (collectively, the "INTELLECTUAL
PROPERTY RIGHTS"). Neither the Company nor any Subsidiary has received a written
notice that the Intellectual Property Rights used by the Company or any
Subsidiary violates or infringes upon the rights of any Person. Except as set
forth in the SEC Reports, to the knowledge of the Company, all such Intellectual
Property Rights are enforceable and there is no existing infringement by another
Person of any of the Intellectual Property Rights.
(q) Insurance. The Company and the Subsidiaries are insured by insurers of
recognized financial responsibility against such losses and risks and in such
amounts as are prudent and customary in the businesses in which the Company and
the Subsidiaries are engaged. The Company has no reason to believe that it will
not be able to renew its existing insurance coverage as and when such coverage
expires or to obtain similar coverage from similar insurers as may be necessary
on market terms.
(r) Transactions With Affiliates and Employees. There are no transactions
between the Company or any Subsidiary on the one hand and any officer or
director of the Company on the other and, to the knowledge of the Company, none
of the employees of the Company is presently a party to any transaction with the
Company or any Subsidiary (other than for services as employees, officers and
directors), in each case, that are required to be described in the SEC Reports
pursuant to Item 404 of Regulation S-K and are not so described in accordance
therewith.
(s) Internal Accounting Controls. The Company and the Subsidiaries maintain a
system of internal accounting controls sufficient to provide reasonable
assurance that (i) transactions are executed in accordance with management's
general or specific authorizations, (ii) transactions are recorded as necessary
to permit preparation of financial statements in conformity with generally
accepted accounting principles and to maintain asset accountability, (iii)
access to assets is permitted only in accordance with management's general or
specific authorization, and (iv) the recorded accountability for assets is
compared with the existing assets at reasonable intervals and appropriate action
is taken with respect to any differences.
(t) Solvency. Based on the financial condition of the Company as of the Closing
Date (and assuming that the Closing shall have occurred), (i) the Company's fair
saleable value of its assets exceeds the amount that will be required to be paid
on or in respect of the Company's existing debts and other liabilities
(including known contingent liabilities) as they mature; (ii) the Company's
assets do not constitute unreasonably small capital to carry on its business for
the current fiscal year as now conducted and as proposed to be conducted
including its capital needs taking into account the particular capital
requirements of the business conducted by the Company, and projected capital
requirements and capital availability thereof; and (iii) the current cash flow
of the Company, together with the proceeds the Company would receive, were it to
liquidate all of its assets, after taking into account all anticipated uses of
the cash, would be sufficient to pay all amounts on or in respect of its debt
when such amounts are required to be paid. The Company does not intend to incur
debts beyond its ability to pay such debts as they mature (taking into account
the timing and amounts of cash to be payable on or in respect of its debt).
(u) Certain Fees. Except as described in Schedule 3.1(u), no brokerage or
finder's fees or commissions are or will be payable by the Company to any
broker, financial advisor or consultant, finder, placement agent, investment
banker, bank or other Person with respect to the transactions contemplated by
this Agreement. The Purchasers shall have no obligation with respect to any fees
or with respect to any claims (other than such fees or commissions owed by a
Purchaser pursuant to written agreements executed by such Purchaser which fees
or commissions shall be the sole responsibility of such Purchaser) made by or on
behalf of other Persons for fees of a type contemplated in this Section that may
be due in connection with the transactions contemplated by this Agreement.
(v) Certain Registration Matters. Assuming the accuracy of the Purchasers'
representations and warranties set forth in Section 3.2(b)-(i), no registration
under the Securities Act is required for the offer and sale of the Shares by the
Company to the Purchasers under the Transaction Documents. The Company is
eligible to register the resale of its Common Stock for resale by the Purchasers
under Form S-3 promulgated under the Securities Act. Except as described in
Schedule 3.1(v), the Company has not granted or agreed to grant to any Person
any rights (including "piggy-back" registration rights) to have any securities
of the Company registered with the Commission or any other governmental
authority that have not been satisfied.
(w) Listing and Maintenance Requirements. Except as specified in the SEC Reports
or that have been cured, the Company has not, in the two years preceding the
date hereof, received notice from any Trading Market to the effect that the
Company is not in compliance with the listing or maintenance requirements
thereof. The Company is, and has no reason to believe that it will not in the
foreseeable future continue to be (other than with respect to minimum price
requirements), in compliance with the current listing and maintenance
requirements for continued listing of the Common Stock on the NASDAQ Stock
Market. The issuance and sale of the Shares under the Transaction Documents does
not contravene the rules and regulations of the Trading Market on which the
Common Stock is currently listed or quoted, and no approval of the shareholders
of the Company thereunder is required for the Company to issue and deliver to
the Purchasers the Shares in accordance with the Transaction Documents.
(x) Investment Company. The Company is not, and is not an Affiliate of, an
"investment company" within the meaning of the Investment Company Act of 1940,
as amended.
(y) No Additional Agreements. The Company does not have any agreement or
understanding with any Purchaser with respect to the transactions contemplated
by the Transaction Documents other than as specified in the Transaction
Documents.
(z) No Ownership in SMS. Neither the Company nor, to the Company's knowledge,
any of its officers or directors own any equity interest in ITO Acquisition
Corp, a data center outsourcing company doing business as Systems Management
Specialists ("SMS") other than pursuant to the Company's acquisition of all of
the outstanding stock of SMS.
(aa) Disclosure. The Company confirms that neither it nor any Person acting on
its behalf has provided any of the Purchasers or their agents or counsel with
any information that the Company believes constitutes material, non-public
information except insofar as the existence and terms of the proposed
transactions hereunder may constitute such information. The Company understands
and confirms that the Purchasers will rely on the foregoing representations and
covenants in effecting transactions in securities of the Company. All disclosure
provided to the Purchasers regarding the Company, its business and the
transactions contemplated hereby, furnished by or on behalf of the Company
(including the Company's representations and warranties set forth in this
Agreement) are true and correct and do not contain any untrue statement of a
material fact or omit to state any material fact necessary in order to make the
statements made therein, in light of the circumstances under which they were
made, not misleading.
(bb) Acquisition of SMS. Upon receipt of a certificate from Xxxx Capital
Partners, LLC in a form satisfactory to the Company certifying that Xxxx Capital
Partners, LLC has obtained at least $27.5 million of gross subscriptions to
purchase Common Stock and assuming the receipt of such financing, the Company
will have sufficient funds to finance the cash component of the purchase price
for the outstanding capital stock of SMS. In addition, as of the date hereof and
assuming receipt of such financing as contemplated by such certificate, to the
Company's knowledge, there would not be expected to be a failure of any material
condition which would prevent the consummation of the acquisition of SMS by the
Company.
3.2 Representations and Warranties of the Purchasers. Each Purchaser hereby, for
itself and for no other Purchaser, represents and warrants to the Company as
follows:
(a) Organization; Authority. Such Purchaser is an entity duly organized, validly
existing and in good standing under the laws of the jurisdiction of its
organization with the requisite corporate or partnership power and authority to
enter into and to consummate the transactions contemplated by the Transaction
Documents to which it is a party and otherwise to carry out its obligations
thereunder. The execution, delivery and performance by such Purchaser of the
transactions contemplated by this Agreement has been duly authorized by all
necessary corporate or, if such Purchaser is not a corporation, such
partnership, limited liability company or other applicable like action, on the
part of such Purchaser. Each of this Agreement and the Registration Rights
Agreement has been duly executed by such Purchaser, and when delivered by such
Purchaser in accordance with terms hereof, will constitute the valid and legally
binding obligation of such Purchaser, enforceable against it in accordance with
its terms, except as such enforceability may be limited by applicable
bankruptcy, insolvency, reorganization, moratorium, liquidation or similar laws
relating to, or affecting generally the enforcement of, creditors' rights and
remedies or by other equitable principles of general application and as any
rights to indemnity or contribution thereunder may be limited by public policy
considerations. Such Purchaser is not required to obtain any consent, waiver,
authorization or order of, give any notice to, or make any filing or
registration with, any court or other federal, state, local or other
governmental authority or other Person in connection with its execution,
delivery and performance of the Transaction Documents other than those that have
been made or obtained prior to the date of the Agreement.
(b) Investment Intent. Such Purchaser understands that the Shares are
"restricted securities" (as defined in Rule 144 under the Securities Act) and
have not been registered under the Securities Act or any applicable state
securities law and such Purchaser is acquiring the Shares as principal for its
own account for investment purposes only and not for the account of any other
Person or with a view to any resale or distribution thereof or any part thereof,
without prejudice, however, to such Purchaser's right at all times to sell or
otherwise dispose of all or any part of such Shares in compliance with
applicable federal and state securities laws. Subject to the immediately
preceding sentence, nothing contained herein shall be deemed a representation or
warranty by such Purchaser to hold the Shares for any period of time. Such
Purchaser is acquiring the Shares hereunder in the ordinary course of its
business. Such Purchaser does not have any agreement or understanding, directly
or indirectly, with any Person to distribute any of the Shares.
(c) Purchaser Status. Such Purchaser is an "accredited investor" as defined in
Rule 501(a) under the Securities Act. Such Purchaser is not a registered
broker-dealer under Section 15 of the Exchange Act.
(d) General Solicitation. Such Purchaser is not purchasing the Shares as a
result of any advertisement, article, notice or other communication regarding
the Shares published in any newspaper, magazine or similar media or broadcast
over television or radio or presented at any seminar or any other general
solicitation or general advertisement.
(e) Access to Information. Such Purchaser acknowledges that it has reviewed the
Disclosure Materials and has been afforded (i) the opportunity to ask such
questions as it has deemed necessary of, and to receive answers from,
representatives of the Company concerning the terms and conditions of the
offering of the Shares and the merits and risks of investing in the Shares; (ii)
access to information about the Company and the Subsidiaries and their
respective financial condition, results of operations, business, properties,
management and prospects sufficient to enable it to evaluate its investment; and
(iii) the opportunity to obtain such additional information that the Company
possesses or can acquire without unreasonable effort or expense that is
necessary to make an informed investment decision with respect to the
investment. Neither such inquiries nor any other investigation conducted by or
on behalf of such Purchaser or its representatives or counsel shall modify,
amend or affect such Purchaser's right to rely on the truth, accuracy and
completeness of the Disclosure Materials and the Company's representations and
warranties contained in the Transaction Documents.
(f) International Actions. Such Purchaser acknowledges, represents and agrees
that no action has been or will be taken in any jurisdiction outside the United
States by the Company that would permit an offering of the Shares, or possession
or distribution of offering materials in connection with the issue of the
Shares, in any jurisdiction outside the United States. If such Purchaser is
located outside the United States, it has or will take all actions necessary for
the sale of the Shares to comply with all applicable laws and regulations in
each foreign jurisdiction in which it purchases, offers, sells or delivers
Shares or has in its possession or distributes any offering material, in all
cases at its own expense.
(g) Experience of such Purchaser. Such Purchaser, either alone or together with
its representatives, has such knowledge, sophistication and experience in
business and financial matters so as to be capable of evaluating the merits and
risks of the prospective investment in the Shares, and has so evaluated the
merits and risks of such investment. Such Purchaser has carefully considered the
potential risks relating to the Company and a purchase of the Shares, and fully
understands that the Shares are speculative investments which involve a high
degree of risk of loss of such Purchaser's entire investment. Such Purchaser is
able to bear the economic risk of an investment in the Shares and, at the
present time, is able to afford a complete loss of such investment.
(h) Limited Ownership. The purchase by such Purchaser of the Shares issuable to
it at the Closing will not result in such Purchaser (individually or together
with other Persons with whom such Purchaser has identified, or will have
identified, itself as part of a "group" in a public filing made with the
Commission involving the Company's securities), acquiring, or obtaining the
right to acquire, in excess of 14.999% of the Common Stock or the voting power
of the Company on a post transaction basis that assumes that the Closing shall
have occurred. Such Purchaser will not, alone or together with others, make a
public filing with the Commission to disclose that it has (or that it together
with such other Persons have) acquired, or obtained the right to acquire, as a
result of the Closing (when added to any other securities of the Company that it
or they then own or have the right to acquire), in excess of 14.999% of the
Common Stock or the voting power of the Company on a post transaction basis that
assumes that the Closing shall have occurred. Such Purchaser acknowledges and
agrees that the Company has not approved the investment by such Purchaser, nor
the Purchaser as an "interested stockholder", in either case for purposes of
Section 203 of the Delaware General Corporate Law, with the result that the
restrictions on "business combinations" set forth therein are applicable to such
Purchaser.
(i) Information. Such Purchaser represents that the information contained in
this Section 3.2 is accurate and may be relied upon by the Company, and such
Purchaser will notify the Company immediately of any material change in any of
such information prior to the Closing.
(j) Not an Officer or Director of the Company. Such Purchaser represents that it
is not an officer or director of the Company or any of its Subsidiaries.
(k) No Agreements to Purchase Shares. Such Purchaser has not entered into, on or
prior to the date hereof, any contract, agreement, arrangement or understanding
with the Company to purchase, directly or indirectly, any Shares.
The Company acknowledges and agrees that each Purchaser does not make or has not
made any representations or warranties with respect to the transactions
contemplated hereby other than those specifically set forth in this Section 3.2.
ARTICLE IV.
OTHER AGREEMENTS OF THE PARTIES
4.1 (a) Shares may only be disposed of in compliance with state and federal
securities laws. In connection with any transfer of the Shares other than
pursuant to an effective registration statement, to the Company or in connection
with a pledge as contemplated in Section 4.1(b), the Company may require the
transferor thereof to provide to the Company an opinion of counsel selected by
the transferor and reasonably satisfactory to the Company, the form and
substance of which opinion shall be reasonably satisfactory to the Company, to
the effect that such transfer does not require registration of such transferred
Shares under the Securities Act.
(b) Certificates evidencing the Shares will contain the
following legend, so long as is required by this Section 4.1(b) or Section
4.1(c):
THESE SHARES HAVE NOT BEEN REGISTERED WITH THE SECURITIES AND
EXCHANGE COMMISSION OR SECURITIES REGULATORS OF ANY STATE IN
RELIANCE UPON AN EXEMPTION FROM REGISTRATION UNDER THE
SECURITIES ACT OF 1933, AS AMENDED (THE "SECURITIES ACT"),
AND, ACCORDINGLY, MAY NOT BE, NOR MAY ANY INTEREST THEREIN BE,
OFFERED OR SOLD EXCEPT PURSUANT TO AN EFFECTIVE REGISTRATION
STATEMENT UNDER THE SECURITIES ACT OR PURSUANT TO AN AVAILABLE
EXEMPTION FROM, OR IN A TRANSACTION NOT SUBJECT TO, THE
REGISTRATION REQUIREMENTS OF THE SECURITIES ACT AND IN
ACCORDANCE WITH APPLICABLE STATE SECURITIES LAWS AS EVIDENCED
BY, SUBJECT TO CERTAIN EXCEPTIONS, A LEGAL OPINION OF COUNSEL
TO THE TRANSFEROR TO SUCH EFFECT, IN FORM AND SUBSTANCE OF
WHICH SHALL BE REASONABLY ACCEPTABLE TO THE COMPANY. THESE
SHARES MAY BE PLEDGED IN CONNECTION WITH A BONA FIDE MARGIN
ACCOUNT SECURED BY SUCH SHARES IN ACCORDANCE WITH APPLICABLE
LAWS.
The Company acknowledges and agrees that a Purchaser may from
time to time make a bona fide pledge, and/or grant of a security interest in
some or all of the Shares pursuant to a bona fide margin agreement in connection
with a bona fide margin account and, if required under the terms of such
agreement or account, such Purchaser may deliver pledged or secured Shares to
the pledgees or secured parties. Such a pledge or transfer would not be subject
to approval or consent of the Company and no legal opinion of legal counsel to
the pledgee, secured party or pledgor shall be required in connection with the
pledge, but such legal opinion may be required in connection with a subsequent
transfer following default by the Purchaser transferee of the pledge. No notice
shall be required of such pledge. At the appropriate Purchaser's expense, the
Company will execute and deliver such reasonable documentation as a pledgee or
secured party of Shares may reasonably request in connection with a pledge or
transfer of the Shares including the preparation and filing of any required
amended registration statement or prospectus supplement under Rule 424(b)(3) of
the Securities Act or other applicable provision of the Securities Act to
appropriately amend the list of Selling Stockholders thereunder.
(c) Certificates evidencing the Shares shall not contain any
legend (including the legend set forth in Section 4.1(b)): (i) following any
sale of such Shares pursuant to an effective registration statement under the
Securities Act, or (ii) following any sale of such Shares pursuant to and in
compliance with Rule 144 and upon receipt by the Company of customary
representation letters from selling Purchasers and their brokers, or (iii)
following receipt by the Company of customary representation letters from the
selling Purchasers evidencing such Purchaser's eligibility to make resales under
Rule 144(k). The Company shall promptly cause its counsel to issue any legal
opinion or instruction required by the Company's transfer agent to effect the
de-legending contemplated in this section. The Company may not make any notation
on its records or give instructions to any transfer agent of the Company that
enlarge the restrictions on transfer set forth in this Section except as it may
reasonably determine are necessary or appropriate to comply or to ensure
compliance with those applicable laws that are enacted or modified after the
Closing such as to require such notation or instructions.
4.2 Furnishing of Information. As long as any Purchaser owns the Shares, the
Company covenants to timely file (or obtain extensions in respect thereof and
file within the applicable grace period) all reports required to be filed by the
Company after the date hereof pursuant to the Exchange Act. Upon the request of
any such Person, the Company shall deliver to such Person a written
certification of a duly authorized officer as to whether it has complied with
the preceding sentence. As long as any Purchaser owns Shares, if the Company is
not required to file reports pursuant to such laws, it will prepare and furnish
to the Purchasers and make publicly available in accordance with Rule 144(c)
such information as is required for the Purchasers to sell the Shares under Rule
144. The Company further covenants that it will take such further action as any
holder of Shares may reasonably request, all to the extent required from time to
time to enable such Person to sell such Shares without registration under the
Securities Act within the limitation of the exemptions provided by Rule 144.
4.3 Integration. The Company shall not, and shall use its best efforts to ensure
that no Affiliate of the Company shall, sell, offer for sale or solicit offers
to buy or otherwise negotiate in respect of any security (as defined in Section
2 of the Securities Act) that would be integrated with the offer or sale of the
Shares in a manner that would require the registration under the Securities Act
of the sale of the Shares to the Purchasers, or that would be integrated with
the offer or sale of the Shares for purposes of the rules and regulations of any
Trading Market, and the Company represents that it has not engaged in such
sales, offers or solicitations during the six months immediately preceding the
date hereof.
4.4 Subsequent Registrations. Other than pursuant to the Registration Statement,
prior to the Effective Date, the Company may not file any registration statement
(other than on Form S-8) with the Commission with respect to any securities of
the Company.
4.5 Securities Laws Disclosure; Publicity. On the date that this Agreement is
executed by the parties, the Company will issue a press release and file a
Current Report on Form 8-K to disclose the execution of this Agreement and the
material terms of the transactions contemplated hereby. On the Closing Date, the
Company will issue a press and file a Current Report on Form 8-K (which will
include the Transaction Documents as exhibits) to disclose the Closing. In
addition, the Company will make such other filings and notices in the manner and
time required by the Commission and the Trading Market on which the Common Stock
is listed. Notwithstanding the foregoing, the Company shall not publicly
disclose the name of any Purchaser, or include the name of any Purchaser in any
press release or any filing with the Commission (other than the Registration
Statement and any exhibits to filings made in respect of this transaction in
accordance with periodic filing requirements under the Exchange Act and Form D
filings with the Commission) or any regulatory agency or Trading Market, without
the prior written consent of such Purchaser, except to the extent such
disclosure is required by law or Trading Market regulations, in which case the
Company shall provide the Purchasers with prior notice of such disclosure.
4.6 Limitation on Issuance of Future Priced Securities. During the six months
following the Closing Date, the Company shall not issue any "Future Priced
Securities" as such term is described by NASD IM-4350-1, other than issuances of
warrants to acquire Common Stock that contain customary anti-dilution protection
(which the parties agree shall not include adjustments tied to other issuances
of Company securities).
4.7 Indemnification of Purchasers. In addition to the indemnity provided in the
Registration Rights Agreement, the Company will indemnify and hold the
Purchasers and their directors, trustees, officers, shareholders, partners,
members, employees and agents (each, a "PURCHASER PARTY") harmless from any and
all losses, liabilities, obligations, claims, contingencies, damages, costs and
expenses, including all judgments, amounts paid in settlements, court costs and
reasonable attorneys' fees and costs of investigation (collectively, "LOSSES")
that any such Purchaser Party may suffer or incur as a result of or relating to
(a) any misrepresentation, breach or inaccuracy of any representation, warranty,
covenant or agreement made by the Company in any Transaction Document or (b)
Section 16(b) of the Exchange Act solely as a result of being deemed to be part
of a group or having acquired beneficial ownership of Shares beneficially owned
by one or more of the other Purchasers, in either case in respect of this clause
(b), solely as a consequence of entering into this Agreement as determined in a
final nonappealable judgment of a court of competent jurisdiction.
4.8 Non-Public Information. The Company covenants and agrees that neither it nor
any other Person acting on its behalf will provide any Purchaser or its agents
or counsel with any information that the Company believes constitutes material
non-public information, unless prior thereto such Purchaser shall have executed
a written agreement regarding the confidentiality and use of such information.
The Company understands and confirms that each Purchaser shall be relying on the
foregoing representations in effecting transactions in securities of the
Company.
4.9 Use of Proceeds. The Company intends to use the net proceeds from the sale
of the Shares hereunder to finance a portion of its acquisition of all of the
outstanding stock of SMS and in the event such acquisition does not close, the
Company intends to use the net proceeds of this offering for other acquisitions
and general working capital purposes.
4.10 Listing of Common Stock. From the date hereof through the Effectiveness
Period (as such term is defined in the Registration Rights Agreement) the
Company agrees, (i) if the Company applies to have the Common Stock traded on
any other Trading Market, it will include in such application the Shares, and
will take such other action as is necessary or desirable in the reasonable
opinion of the Purchasers to cause the Shares to be listed on such other Trading
Market as promptly as possible and (ii) it will take all action reasonably
necessary to continue the listing and trading of its Common Stock on a Trading
Market and will comply in all material respects with the Company's reporting,
filing and other obligations under the bylaws or rules of the Trading Market.
4.11 Delivery of Investment Amount. Promptly following its execution of this
Agreement, each Purchaser shall deliver to the escrow account specified on Annex
1 to this Agreement, for deposit and distribution in accordance with the terms
of the Escrow Agreement, such Purchaser's Investment Amount, in United States
dollars and in immediately available funds.
ARTICLE V.
CONDITIONS PRECEDENT TO CLOSING
5.1 Conditions Precedent to Obligations of the Purchasers. Each Purchaser's
obligation to purchase the Shares at the Closing is subject to the satisfaction
or waiver by such Purchaser of the following conditions:
(a) Representations and Warranties. The representations and warranties of the
Company set forth in this Agreement shall be true and correct in all material
respects (except for those qualified as to materiality, which shall be true and
correct) as of the date of this Agreement and as of the Closing Date (except to
the extent that such representation or warranty speaks of an earlier date, in
which case such representation or warranty shall be true and correct in all
material respects (or if qualified by materiality, which shall be true and
correct) as of such date) as though made on and as of the Closing Date.
(b) Performance of Obligations. The Company shall have performed in all material
respects all agreements and covenants required to be performed by it under this
Agreement prior to the Closing Date.
(c) No Injunction. No statute, rule, regulation, executive order, decree, ruling
or injunction shall have been enacted, entered, promulgated or endorsed by any
court or governmental authority of competent jurisdiction or by the NASDAQ
National Market which prohibits the consummation of any of the transactions
contemplated by the Transaction Documents.
(d) No Material Adverse Effect. Between the execution of this Agreement and the
Closing, no event or series of events (other than stock price fluctuations)
shall have occurred which reasonably would be expected to have or result in a
Material Adverse Effect.
(e) Company Deliverables. The Company shall have delivered all of the Company
Deliverables for distribution at Closing.
(f) Minimum Subscriptions. The aggregate of all Purchasers' Investment Amounts
delivered to the Escrow Agent or the Company in accordance with Section 4.11 and
the Escrow Agreement shall not be less than $27.5 million.
(g) Nasdaq Listing. The Nasdaq Stock Market shall have approved the Company's
application for the listing of the Shares and shall not have objected to the
transactions contemplated by this Agreement.
(h) Closing Date. The Closing shall have occurred by April 5, 2004.
5.2 Conditions Precedent to Obligations of the Company. The Company's obligation
to issue and sell the Shares to each Purchaser at the Closing is subject to the
satisfaction, or waiver by the Company, of the following conditions:
(a) Representations and Warranties. The representations and warranties of such
Purchaser set forth in this Agreement shall be true and correct in all material
respects as of the date of this Agreement and as of the Closing Date (except to
the extent that such representation or warranty speaks of an earlier date, in
which case such representation or warranty shall be true and correct in all
material respects as of such date) as though made on the Closing Date.
(b) Performance of Obligations. Such Purchaser shall have performed in all
material respects all agreements and covenants required to be performed by it
under this Agreement prior to the Closing Date.
(c) No Injunction. No statute, rule, regulation, executive order, decree, ruling
or injunction shall have been enacted, entered, promulgated or endorsed by any
court or governmental authority of competent jurisdiction or by the NASDAQ
National Market which prohibits the consummation of any of the transactions
contemplated by the Transaction Documents.
(d) Minimum Subscriptions. The aggregate of all Purchasers' Investment Amounts
delivered to the Escrow Agent or the Company in accordance with Section 4.11 and
the Escrow Agreement shall not be less than $27.5 million.
(e) Nasdaq Listing. The Nasdaq Stock Market shall have approved the Company's
application for the listing of the Shares and shall not have objected to the
transactions contemplated by this Agreement.
(f) Closing Date. The Closing shall have occurred by April 5, 2004.
ARTICLE VI.
MISCELLANEOUS
6.1 Fees and Expenses. At the Closing, the Company shall pay to Xxxxx Xxxx LLP,
upon presentation of an invoice, $25,000 in connection with the preparation of
the Transaction Documents, it being understood that Xxxxx Xxxx LLP has only
rendered legal advice to Xxxx Capital Partners LLC, and not to the Company or
any Purchaser in connection with the transactions contemplated hereby, and that
each of the Company and each Purchaser has relied for such matters on the advice
of its own respective counsel. Except as specified in the immediately preceding
sentence and as specified in the Registration Rights Agreement, each party shall
pay the fees and expenses of its advisers, counsel, accountants and other
experts, if any, and all other expenses incurred by such party incident to the
negotiation, preparation, execution, delivery and performance of the Transaction
Documents. The Company shall pay all stamp and other taxes and duties levied in
connection with the sale of the Shares.
6.2 Entire Agreement. The Transaction Documents, together with the Exhibits,
Annexes and Schedules thereto, contain the entire understanding of the parties
with respect to the subject matter hereof and supersede all prior agreements and
understandings, oral or written, with respect to such matters, which the parties
acknowledge have been merged into such documents, exhibits and schedules.
6.3 Notices. Any and all notices or other communications or deliveries required
or permitted to be provided hereunder shall be in writing and shall be deemed
given and effective on the earliest of (a) the date of transmission, if such
notice or communication is delivered via facsimile at the facsimile number
specified in this Section prior to 6:30 p.m. (New York City time) on a Trading
Day, (b) the next Trading Day after the date of transmission, if such notice or
communication is delivered via facsimile at the facsimile number specified in
this Section on a day that is not a Trading Day or later than 6:30 p.m. (New
York City time) on any Trading Day, (c) the Trading Day following the date of
mailing, if sent by U.S. nationally recognized overnight courier service, or (d)
upon actual receipt by the party to whom such notice is required to be given.
The address for such notices and communications shall be as follows:
If to the Company: Infocrossing, Inc.
0 Xxxxxxxx Xxxxxxx Xxxxxx
Xxxxxx, XX 00000
Attn: Chief Executive Officer
Facsimile No.: (000) 000-0000
With a copy to: Xxxxxx & Xxxxxxx LLP
000 Xxxxx Xxxxxx, Xxxxx 0000
Xxx Xxxx, XX 00000-0000
Attn: Xxxxxx X. Xxxxxxx, Esq.
Facsimile No.: (000) 000-0000
If to a Purchaser: To the address set forth under such
Purchaser's name on the signature
pages hereof;
or such other address as may be designated in writing hereafter, in the same
manner, by such Person.
6.4 Amendments; Waivers. No provision of this Agreement may be waived or amended
except in a written instrument signed, in the case of an amendment, by the
Company and the holders of two-thirds of the Shares then outstanding or, in the
case of a waiver, by the party against whom enforcement of any such waiver is
sought. No waiver of any default with respect to any provision, condition or
requirement of this Agreement shall be deemed to be a continuing waiver in the
future or a waiver of any subsequent default or a waiver of any other provision,
condition or requirement hereof, nor shall any delay or omission of either party
to exercise any right hereunder in any manner impair the exercise of any such
right.
6.5 Construction. The headings herein are for convenience only, do not
constitute a part of this Agreement and shall not be deemed to limit or affect
any of the provisions hereof. The language used in this Agreement will be deemed
to be the language chosen by the parties to express their mutual intent, and no
rules of strict construction will be applied against any party. 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 provisions of this Agreement or any of the Transaction
Documents.
6.6 Successors and Assigns. This Agreement shall be binding upon and inure to
the benefit of the parties and their successors and permitted assigns. The
Company may not assign this Agreement or any rights or obligations hereunder
without the prior written consent of the Purchasers. Any Purchaser may assign
any or all of its rights under this Agreement to any Person to whom such
Purchaser assigns or transfers any Shares in other than a registered resale or a
resale pursuant to Rule 144, provided such transfer is in compliance with
Section 4.1 and the transferee undertakes in writing to the Company to be bound,
with respect to the transferred Shares, by the provisions hereof that apply to
the Purchasers.
6.7 No Third-Party Beneficiaries. This Agreement is intended for the benefit of
the parties hereto and their respective successors and permitted assigns and is
not for the benefit of, nor may any provision hereof be enforced by, any other
Person, except as otherwise set forth in Section 4.7.
6.8 Governing Law. All questions concerning the construction, validity,
enforcement and interpretation of this Agreement shall be governed by and
construed and enforced in accordance with the internal laws of the State of New
York, without regard to the principles of conflicts of law thereof. Each party
agrees that all Proceedings concerning the interpretations, enforcement and
defense of the transactions contemplated by this Agreement and any other
Transaction Documents (whether brought against a party hereto or its respective
Affiliates, employees or agents) shall be commenced exclusively in the state and
federal courts sitting in the City of New York, Borough of Manhattan (the "NEW
YORK COURTS"). Each party hereto hereby irrevocably submits to the exclusive
jurisdiction of the New York Courts for the adjudication of any dispute
hereunder or in connection herewith or with any transaction contemplated hereby
or discussed herein (including with respect to the enforcement of the any of the
Transaction Documents), and hereby irrevocably waives, and agrees not to assert
in any Proceeding, any claim that it is not personally subject to the
jurisdiction of any such New York Court, or that such Proceeding has been
commenced in an improper or inconvenient forum. Each party hereto hereby
irrevocably waives personal service of process and consents to process being
served in any such Proceeding by mailing a copy thereof via registered or
certified mail or overnight delivery (with evidence of delivery) to such party
at the address in effect for notices to it under this Agreement and agrees that
such service shall constitute good and sufficient service of process and notice
thereof. Nothing contained herein shall be deemed to limit in any way any right
to serve process in any manner permitted by law. Each party hereto hereby
irrevocably waives, to the fullest extent permitted by applicable law, any and
all right to trial by jury in any legal proceeding arising out of or relating to
this Agreement or the transactions contemplated hereby. If either party shall
commence a Proceeding to enforce any provisions of a Transaction Document, then
the prevailing party in such Proceeding shall be reimbursed by the other party
for its attorney's fees and other costs and expenses incurred with the
investigation, preparation and prosecution of such Proceeding.
6.9 Survival. The representations and warranties contained herein shall survive
the Closing and the delivery of the Shares for a period of two years from the
Closing. The agreements and covenants contained herein shall survive the Closing
in accordance with their respective terms.
6.10 Execution. This Agreement may be executed in two or more counterparts, all
of which when taken together shall be considered one and the same agreement and
shall become effective when counterparts have been signed by each party and
delivered to the other party, it being understood that both parties need not
sign the same counterpart. In the event that any signature is delivered by
facsimile transmission, such signature shall create a valid and binding
obligation of the party executing (or on whose behalf such signature is
executed) with the same force and effect as if such facsimile signature page
were an original thereof.
6.11 Severability. If any provision of this Agreement is held to be invalid or
unenforceable in any respect, the validity and enforceability of the remaining
terms and provisions of this Agreement shall not in any way be affected or
impaired thereby and the parties will attempt to agree upon a valid and
enforceable provision that is a reasonable substitute therefor, and upon so
agreeing, shall incorporate such substitute provision in this Agreement.
6.12 Rescission and Withdrawal Right. Notwithstanding anything to the contrary
contained in (and without limiting any similar provisions of) the Transaction
Documents, whenever any Purchaser exercises a right, election, demand or option
under a Transaction Document and the Company does not timely perform its related
obligations within the periods therein provided, then such Purchaser may rescind
or withdraw, in its sole discretion from time to time upon written notice to the
Company, any relevant notice, demand or election in whole or in part without
prejudice to its future actions and rights.
6.13 Replacement of Shares. If any certificate or instrument evidencing any
Shares is mutilated, lost, stolen or destroyed, the Company shall issue or cause
to be issued in exchange and substitution for and upon cancellation thereof, or
in lieu of and substitution therefor, a new certificate or instrument, but only
upon receipt of evidence reasonably satisfactory to the Company of such loss,
theft or destruction and customary and reasonable indemnity, if requested. The
applicants for a new certificate or instrument under such circumstances shall
also pay any reasonable third-party costs associated with the issuance of such
replacement Shares. If a replacement certificate or instrument evidencing any
Shares is requested due to a mutilation thereof, the Company may require
delivery of such mutilated certificate or instrument as a condition precedent to
any issuance of a replacement.
6.14 Remedies. In addition to being entitled to exercise all rights provided
herein or granted by law, including recovery of damages, each of the Purchasers
and the Company will be entitled to specific performance under the Transaction
Documents. The parties agree that monetary damages may not be adequate
compensation for any loss incurred by reason of any breach of obligations
described in the foregoing sentence and hereby agrees to waive in any action for
specific performance of any such obligation the defense that a remedy at law
would be adequate.
6.15 Payment Set Aside. To the extent that the Company makes a payment or
payments to any Purchaser pursuant to any Transaction Document or a Purchaser
enforces or exercises its rights thereunder, and such payment or payments or the
proceeds of such enforcement or exercise or any part thereof are subsequently
invalidated, declared to be fraudulent or preferential, set aside, recovered
from, disgorged by or are required to be refunded, repaid or otherwise restored
to the Company, a trustee, receiver or any other person under any law
(including, without limitation, any bankruptcy law, state or federal law, common
law or equitable cause of action), then to the extent of any such restoration
the obligation or part thereof originally intended to be satisfied shall be
revived and continued in full force and effect as if such payment had not been
made or such enforcement or setoff had not occurred.
6.16 Independent Nature of Purchasers' Obligations and Rights. The obligations
of each Purchaser under any Transaction Document are several and not joint with
the obligations of any other Purchaser, and no Purchaser shall be responsible in
any way for the performance of the obligations of any other Purchaser under any
Transaction Document. The decision of each Purchaser to purchase Shares pursuant
to the Transaction Documents has been made by such Purchaser independently of
any other Purchaser. Nothing contained herein or in any Transaction Document,
and no action taken by any Purchaser pursuant thereto, shall be deemed to
constitute the Purchasers as a partnership, an association, a joint venture or
any other kind of entity, or create a presumption that the Purchasers are in any
way acting in concert or as a group with respect to such obligations or the
transactions contemplated by the Transaction Document. Each Purchaser
acknowledges that no other Purchaser has acted as agent for such Purchaser in
connection with making its investment hereunder and that no Purchaser will be
acting as agent of such Purchaser in connection with monitoring its investment
in the Shares or enforcing its rights under the Transaction Documents. Each
Purchaser shall be entitled to independently protect and enforce its rights,
including without limitation the rights arising out of this Agreement or out of
the other Transaction Documents, and it shall not be necessary for any other
Purchaser to be joined as an additional party in any proceeding for such
purpose.
6.17 Limitation of Liability. Notwithstanding anything herein to the contrary,
the Company acknowledges and agrees that the liability of any Purchaser arising
directly or indirectly, under any Transaction Document, of any and every nature
whatsoever, shall be satisfied solely out of the assets of such Purchaser, and
that no trustee, officer, other investment vehicle affiliated with such
Purchaser or any investor, shareholder or holder of shares of beneficial
interest of such a Purchaser shall be personally liable for any liabilities of
such Purchaser.
[REMAINDER OF PAGE INTENTIONALLY LEFT BLANK
SIGNATURE PAGES FOLLOW]
IN WITNESS WHEREOF, the parties hereto have caused this Securities
Purchase Agreement to be duly executed by their respective authorized
signatories as of the date first indicated above.
INFOCROSSING, INC.
/S/ XXXX XXXXXXXX
--------------------------------------
Name: Xxxx Xxxxxxxx
Title: Chairnam and Chief Executive Officer
[REMAINDER OF PAGE INTENTIONALLY LEFT BLANK
SIGNATURE PAGES FOR PURCHASERS FOLLOW]
IN WITNESS WHEREOF, the parties have executed this Securities Purchase
Agreement as of the date first written above.
Trustman in c/o STI Classic Small Cap
Growth Fund
By:/S/ Xxxx X. Xxxxxxxxx
----------------------------------------
Name: Xxxx X. Xxxxxxxxx
Title: Vice President & Fund Manager
Investment Amount: $1,281,000
Address for Notice: Trusco Capital
Management
00 Xxxx Xxxxx Xxxxx 0000
Xxxxxxx, XX 00000
Facsimile No.:
Attn:
Trustman in c/o Xxxxxx Xxxxxx Xxxxx
Foundation
By:/S/ Xxxx X. Xxxxxxxxx
----------------------------------------
Name: Xxxx X. Xxxxxxxxx
Title: Vice President & Fund Manager
Investment Amount: $24,150
Address for Notice: Trusco Capital
Management
00 Xxxx Xxxxx Xxxxx 0000
Xxxxxxx, XX 00000
Facsimile No.:
Attn:
Trustman in c/i TUA Xxxxxx Xxxxxx
By:/S/ Xxxx X. Xxxxxxxxx
----------------------------------------
Name: Xxxx X. Xxxxxxxxx
Title: Vice President & Fund Manager
Investment Amount: $5,250
Address for Notice: Trusco Capital
Management
00 Xxxx Xxxxx Xxxxx 0000
Xxxxxxx, XX 00000
Facsimile No.:
Attn:
Trustman in c/o TUA Xxxxxx Xxxxxx
By:/S/ Xxxx X. Xxxxxxxxx
----------------------------------------
Name: Xxxx X. Xxxxxxxxx
Title: Vice President & Fund Manager
Investment Amount: $2,100
Address for Notice: Trusco Capital
Management
00 Xxxx Xxxxx Xxxxx 0000
Xxxxxxx, XX 00000
Facsimile No.:
Attn:
SF Capital Partners Ltd.
By:/S/ Xxxxx Xxxxx
----------------------------------------
Name: Xxxxx Xxxxx
Title: Authorized Signatory
Investment Amount: $1,018,500
Address for Notice: 0000 0 Xxxx Xxxxx
Xx. Xxxxxxx, XX 00000
Facsimile No.: 000-000-0000
Attn: Xxxxx X. Xxxxxxxx
JLF Partners I, L.P.
By:/S/ Xxxx Xxxxxxxxx
----------------------------------------
Name: Xxxx Xxxxxxxxx
Title: CFO
Investment Amount: $2,677,500
Address for Notice: 0000 Xxx xx xx Xxxxx
Xxx Xxx, XX 00000
Facsimile No.: 000-000-0000
Attn: Xxxx Xxxxxxxx
JLF Partners II, L.P.
By:/S/ Xxxx Xxxxxxxxx
----------------------------------------
Name: Xxxx Xxxxxxxxx
Title: CFO
Investment Amount: $210,000
Address for Notice: 0000 Xxx xx xx Xxxxx
Xxx Xxx, XX 00000
Facsimile No.: 000-000-0000
Attn: Xxxx Xxxxxxxx
JLF Offshore Fund, Ltd
By:/S/ Xxxx Xxxxxxxxx
----------------------------------------
Name: Xxxx Xxxxxxxxx
Title: CFO
Investment Amount: $4,620,000
Address for Notice: 0000 Xxx xx xx Xxxxx
Xxx Xxx, XX 00000
Facsimile No.: 000-000-0000
Attn: Xxxx Xxxxxxxx
LBI Group
By:/S/ Xxxx Xxxxxxxxx
----------------------------------------
Name: Xxxx Xxxxxxxxx
Title: Vice President
Investment Amount: $4,935,000
Address for Notice: c/x Xxxxxx Brothers, Inc
000 Xxxx Xxx. 0xx Xxx
Xxx Xxxx, XX 00000
Facsimile No.: 000-000-0000
Attn: Xxxxxxx Xxxxxxx
Janus Investment Fund,
On behalf of its series Janus Venture Fund
By:/S/ Xxxxxxx Xxxxx
----------------------------------------
Name: Xxxxxxx Xxxxx
Title: Portfolio Manager
Investment Amount: $4,200,000
Address for Notice: 000 Xxxxxxx Xxxxxx
Xxxxxx XX 00000
Facsimile No.: 000-000-0000
Attn: Xxxxx Xxxxxx
V.P. and Assistant General
Counsel
Leaf Investment Partners LP
By:/S/ Xxxxxxx Xxxxxxxxx
----------------------------------------
Name: Xxxxxxx Xxxxxxxxx
Title: Managing Principal of S Squared
Capital LLC which is the General
Partner of Leaf Investment
Partners LP
Investment Amount: $2,770,950
Address for Notice: S Squared Technology
Corp. Suite 4200
000 Xxxxxxx Xxx.
Xxx Xxxx, XX 00000-0000
Facsimile No.: 000-000-0000
Attn: Xx. Xxxxxxx X Xxxxxxxxx
Leaf Offshore Investment Fund Ltd
By:/S/ Xxxxxxx Xxxxxxxxx
----------------------------------------
Name: Xxxxxxx Xxxxxxxxx
Title: Managing Principal of S Squared
Capital LLC which is the General
Partner of Leaf Offshore
Investment Fund Ltd
Investment Amount: $746,550
Address for Notice: S Squared Technology
Corp. Suite 4200
000 Xxxxxxx Xxx.
Xxx Xxxx, XX 00000-0000
Facsimile No.: 000-000-0000
Attn: Xx. Xxxxxxx X Xxxxxxxxx
Bear Xxxxxxx Sec. Corp, Cust J Xxxxxx
Emeraon XXX ROII
By:/S/ J Xxxxxx Xxxxxxx
----------------------------------------
Name: J Xxxxxx Xxxxxxx
Title: Self Xxx xxxx directed XXX
Investment Amount: $1,732,500
Address for Notice: Bear Xxxxxxx Sec. Corp
Cust J Xxxxxx Xxxxxxx
XXX ROII
0000 Xxxxxx xx xxx
Xxxxxx #0000
Xxx Xxxxxxx XX 00000
Facsimile No.: 000-000-0000
Attn: Xxxx Xxxxx
Bear Xxxxxxx Sec. Corp, Cust J Xxxxxx
Emeraon XXXX XXX
By:/S/ J Xxxxxx Xxxxxxx
----------------------------------------
Name: J Xxxxxx Xxxxxxx
Title: Self Xxx xxxx directed XXX
Investment Amount: $1,312,500
Address for Notice: Bear Xxxxxxx Sec. Corp
Cust J Xxxxxx Xxxxxxx
XXX ROII
0000 Xxxxxx xx xxx
Xxxxxx #0000
Xxx Xxxxxxx XX 00000
Facsimile No.: 000-000-0000
Attn: Xxxx Xxxxx
Baron Small Cap Fund, A series of Baron
Asset Fund
Investment Amount: $2,530,500
and
Baron iOpportunity Fund, A series of Baron
Asset Fund
Investment Amount: $514,500
By:/S/ Xxxxx X. Xxxxxxxxx
----------------------------------------
Name: Xxxxx X. Xxxxxxxxx
Title: V.P. and General Counsel
Address for Notice: 000 Xxxxx Xxxxxx
00xx Xxxxx
Xxx Xxxx, XX 00000
Facsimile No.: 000-000-0000
Attn: Xxxxx X. Xxxxxxxxx, Esq.
Crestview Capital Master, LLC
By:/S/ Xxxxxx Xxxx
----------------------------------------
Name: Xxxxxx Xxxx
Title: Managing Director
Investment Amount: $682,500
Address for Notice: 00 Xxxxxx Xxxxx Xxx X
Xxxxxxxxxx, XX 00000
Facsimile No.: 000-000-0000
Attn: Xxxxxx Xxxx
Topaz Partners
By:/S/ Xxxxxx Xxxxxx
----------------------------------------
Name: Xxxxxx Xxxxxx
Title: Chief Operating Officer
Investment Amount: $525,000
Address for Notice: c/o Jemmco Capital Corp
000 Xxxxx Xxx
Xxx Xxxx, XX 00000
Facsimile No.: 000-000-0000
Attn: Xxxxxx Xxxxxx
Corsair Capital Partners, LP
By:/S/ Xxx Xxxxxxxx
----------------------------------------
Name: Xxx Xxxxxxxx
Title: Managing Member
Investment Amount: $315,000
Address for Notice: 000 Xxxxxxx Xxxxxx
0xx Xxxxx
Xxx Xxxx, XX 00000
Facsimile No.: 000-000-0000
Attn: Xxxxx Xxxx
Corsair Capital Investors, Ltd.
By:/S/ Xxx Xxxxxxxx
----------------------------------------
Name: Xxx Xxxxxxxx
Title: Managing Member
Investment Amount: $157,500
Address for Notice: 000 Xxxxxxx Xxxxxx
0xx Xxxxx
Xxx Xxxx, XX 00000
Facsimile No.: 000-000-0000
Attn: Xxxxx Xxxx
Corsair Capital Partners 700, LP
By:/S/ Xxx Xxxxxxxx
----------------------------------------
Name: Xxx Xxxxxxxx
Title: Managing Member
Investment Amount: $52,500
Address for Notice: 000 Xxxxxxx Xxxxxx
0xx Xxxxx
Xxx Xxxx, XX 00000
Facsimile No.: 000-000-0000
Attn: Xxxxx Xxxx
FlyLine Holdings, Ltd.
By:/S/ Xxxxxxx X. Xxxxxx
----------------------------------------
Name: Xxxxxxx X. Xxxxxx
Title: Member
Investment Amount: $210,000
Address for Notice: 000 Xxxx 0xx Xxxxxx
Xxxxx 000
Xxxx Xxxxx, XX 00000
Facsimile No.: 000-000-0000
Attn: Xxxx Xxxxxxxxx
SRG Capital, LLC
By:/S/ Xxxxxx X. Xxxxxxx
----------------------------------------
Name: Xxxxxx X. Xxxxxxx
Title: Chief Financial Officer
Investment Amount: $105,000
Address for Notice: 000 Xxxxxxxx
00xx Xxxxx
Xxx Xxxx, XX 00000
Facsimile No.: 000-000-0000
Attn: Xxxx Xxxx
