LIMITED LIABILITY COMPANY INTEREST PURCHASE AGREEMENT BY AND BETWEEN SSN HOLDINGS, LLC AND COLLEXIS HOLDINGS, INC. August 18, 2009
Exhibit
11.1
LIMITED
LIABILITY COMPANY INTEREST
PURCHASE
AGREEMENT
BY
AND BETWEEN
SSN
HOLDINGS, LLC
AND
August
18, 2009
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1
Exhibit
11.1
LIMITED LIABILITY COMPANY
INTEREST
PURCHASE
AGREEMENT
THIS LIMITED LIABILITY COMPANY
INTEREST PURCHASE AGREEMENT (this "Agreement") is entered into as of the
1st day of August, 2009 (“Effective Date”), by and between SSN Holdings, LLC, a
Nevada Limited Liability Company ("Buyer"), and Collexis
Holdings, Inc., a Nevada corporation ("Parent"). Buyer and Parent
are referred to collectively herein as the "Parties."
Parent in
the aggregate owns all of the issued and outstanding Target Interests (as
defined below) of Lawriter, LLC, an Ohio limited liability company (the “Target”).
This
Agreement contemplates a transaction in which Buyer will purchase from Parent,
and Parent will sell to Buyer, all of the issued and outstanding Target
Interests of Target in return for cash and the assumption of certain
liabilities of Parent at Closing (as defined below).
Now,
therefore, in consideration of the premises and the mutual promises herein made,
and in consideration of the representations, warranties, and covenants herein
contained, the receipt and sufficiency of which are hereby acknowledged, the
Parties agree as follows.
Section
1.
Definitions.
"Adverse Consequences" means
all actions, suits, proceedings, hearings, investigations, charges, complaints,
claims, demands, injunctions, judgments, orders, decrees, rulings, damages,
dues, penalties, fines, costs, reasonable amounts paid in settlement,
liabilities, obligations, taxes, liens, losses, expenses, and fees, including
court costs and reasonable attorneys' fees and expenses.
"Affiliate" has the meaning
set forth in Rule 12b-2 of the regulations promulgated under the Securities
Exchange Act.
"Affiliated Group" means any
affiliated group within the meaning of Code Section 1504(a) or any similar group
defined under a similar provision of state, local or foreign law.
"Applicable Rate" means the
corporate base rate of interest publicly announced from time to time by The Wall Street Journal
plus/minus two percent (2%) per annum.
"Buyer" has the meaning set
forth in the preface above.
"Cash" means cash and cash
equivalents calculated in accordance with GAAP applied on a basis consistent
with the preparation of the Financial Statements.
"Closing" has the meaning set
forth in Section 2(d) below.
"Closing Date" has the meaning
set forth in Section 2(d) below.
"Code" means the Internal
Revenue Code of 1986, as amended.
"Confidential Information"
means any information concerning the business and affairs of Target that is not
already generally available to the public.
"Disclosure Schedule" has the
meaning set forth in Section 4 below.
"Employee Benefit Plan" means
any "employee benefit plan" (as such term is defined in ERISA Section 3(3)) and
any other material employee benefit plan, program or arrangement.
"Employee Pension Benefit
Plan" has the meaning set forth in ERISA Section 3(2).
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Exhibit
11.1
"Employee Welfare Benefit
Plan" has the meaning set forth in ERISA Section 3(1).
"ERISA" means the Employee
Retirement Income Security Act of 1974, as amended.
"ERISA Affiliate" means each
entity that is treated as a single employer with Target for purposes of Code
Section 414.
"Financial Statements" has the
meaning set forth in Section 4(g) below.
"GAAP" means U.S. generally
accepted accounting principles as in effect from time to time, consistently
applied.
"Income Tax" means any
federal, state, local, or foreign income tax measured by or imposed on net
income, including any interest, penalty, or addition thereto, whether disputed
or not.
"Income Tax Return" means any
return, declaration, report, claim for refund, or information return or
statement relating to Income Taxes, including any schedule or attachment
thereto.
"Indemnified Party" has the
meaning set forth in Section 8(d) below.
"Indemnifying Party" has the
meaning set forth in Section 8(d) below.
“Intellectual Property” means
all of the following in any jurisdiction throughout the world: (a) all
inventions (whether patentable or unpatentable and whether or not reduced to
practice), all improvements thereto, and all patents, patent applications, and
patent disclosures, together with all reissuances, continuations,
continuations-in-part, revisions, extensions, and reexaminations thereof, (b)
all trademarks, service marks, trade dress, logos, slogans, trade names,
corporate names, Internet domain names, and rights in telephone numbers,
together with all translations, adaptations, derivations, and combinations
thereof and including all goodwill associated therewith, and all applications,
registrations, and renewals in connection therewith, (c) all copyrightable
works, all copyrights, and all applications, registrations, and renewals in
connection therewith, (d) all mask works and all applications, registrations,
and renewals in connection therewith, (e) all trade secrets and confidential
business information (including ideas, research and development, know-how,
formulas, compositions, manufacturing and production processes and techniques,
technical data, designs, drawings, specifications, customer and supplier lists,
pricing and cost information, and business and marketing plans and proposals),
(f) all computer software (including source code, executable code, data,
databases, and related documentation), (g) all advertising and promotional
materials, (h) all other proprietary rights, and (i) all copies and tangible
embodiments thereof (in whatever form or medium).
"Knowledge" means actual
knowledge. A Person (other than an individual) will be deemed to have
“Knowledge” (as defined in this definition or otherwise in this Agreement) of a
particular fact or other matter if any individual who is serving or has served
as a member, director, officer, partner, executor, or trustee of such Person (or
in any similar capacity) had Knowledge of such fact or other matter or any such
Person who shall be serving in such capacity at the time “knowledge” is to be
determined, has knowledge as defined herein.
"Leased Real Property" means
all leasehold or subleasehold estates and other rights to use or occupy any
land, buildings, structures, improvements, fixtures, or other interest in real
property that is used in Target’s business.
"Leases" means all leases,
subleases, licenses, concessions and other agreements (written or oral),
including all amendments, extensions, renewals, guaranties, and other agreements
with respect thereto, pursuant to which Target holds any Leased Real
Property.
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Exhibit
11.1
"Lien" means any mortgage,
pledge, lien, encumbrance, charge, or other security interest, other than (a)
liens for taxes not yet due and payable or for taxes that the taxpayer is
contesting in good faith through appropriate proceedings, (b) purchase money
liens and liens securing rental payments under capital lease arrangements, and
(c) other liens arising in the Ordinary Course of Business and not incurred in
connection with the borrowing of money.
"Material Adverse Effect" or
"Material Adverse
Change" means any effect or change that would be materially adverse to
the business of Target, taken as a whole, or to the ability of any Party to
consummate timely the transactions contemplated hereby; provided that none of
the following shall be deemed to constitute, and none of the following shall be
taken into account in determining whether there has been, a Material Adverse
Effect or Material Adverse Change: (a) any adverse change, event, development,
or effect arising from or relating to (1) general business or economic
conditions, including such conditions related to the business of Target, (2)
national or international political or social conditions, including the
engagement by the United States in hostilities, whether or not pursuant to the
declaration of a national emergency or war, or the occurrence of any military or
terrorist attack upon the U.S., or any of its territories, possessions, or
diplomatic or consular offices or upon any military installation, equipment or
personnel of the U.S., (3) financial, banking, or securities markets (including
any disruption thereof and any decline in the price of any security or any
market index), (4) changes in U.S. generally accepted accounting principles, (5)
changes in laws, rules, regulations, orders, or other binding directives issued
by any governmental entity, or (6) the taking of any action contemplated by this
Agreement and the other agreements contemplated hereby, (b) any existing event,
occurrence, or circumstance with respect to which Buyer has knowledge as of the
date hereof, and (c) any adverse change in or effect on the business of Target
that is cured before the earlier of (1) the Closing Date or (2) the date on
which this Agreement is terminated pursuant to Section 10 hereof.
"Most Recent Financial
Statements" has the meaning set forth in Section 4(f) below.
"Most Recent Fiscal Month End"
has the meaning set forth in Section 4(f) below.
"Ordinary Course of Business"
means the ordinary course of business consistent with past custom and practice
(including with respect to quantity and frequency).
"Owned Real Property" means
all land, together with all buildings, structures, improvements, and fixtures
located thereon, and all easements and other rights and interests appurtenant
thereto, owned by Target and used in the business of Target.
"Party" has the meaning set
forth in the preface above.
"Person" means an individual,
a partnership, a corporation, a limited liability company, an association, a
joint stock company, a trust, a joint venture, an unincorporated organization,
any other business entity or a governmental entity (or any department, agency,
or political subdivision thereof).
"Purchase Price" has the
meaning set forth in Section 2(b) below.
"Securities Act" means the
Securities Act of 1933, as amended.
"Securities Exchange Act"
means the Securities Exchange Act of 1934, as amended.
"Parent" has the meaning set
forth in the preface above.
”Parent
Assets” means any and all property and rights owned by Parent
or to which rights are held by Parent only to the extent they are used in the
provision of Services by Target, including, without limitation, the “Mediator”
product and the bankruptcy dashboard product.
“Services” means the
Casemaker® online legal research service made available to Target’s
customers.
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Exhibit
11.1
"Subsidiary" means, with
respect to any Person, any corporation, limited liability company, partnership,
association, or other business entity of which (i) if a corporation, a majority
of the total voting power of shares of stock entitled (without regard to the
occurrence of any contingency) to vote in the election of directors, managers,
or trustees thereof is at the time owned or controlled, directly or indirectly,
by that Person or one or more of the other Subsidiaries of that Person or a
combination thereof or (ii) if a limited liability company, partnership,
association, or other business entity (other than a corporation), a majority of
the partnership or other similar ownership interests thereof is at the time
owned or controlled, directly or indirectly, by that Person or one or more
Subsidiaries of that Person or a combination thereof and for this purpose, a
Person or Persons own a majority ownership interest in such a business entity
(other than a corporation) if such Person or Persons shall be allocated a
majority of such business entity's gains or losses or shall be or control any
managing director or general partner of such business entity (other than a
corporation). The term "Subsidiary" shall include all Subsidiaries of such
Subsidiary.
"Target" has the meaning set
forth in the preface above.
"Target Interests" means all
of the issued and outstanding ownership interests of Target.
"Tax" or "Taxes" means any federal,
state, local, or foreign income, gross receipts, license, payroll, employment,
excise, severance, stamp, occupation, premium, windfall profits, environmental
(including taxes under Code Section 59A), customs duties, capital stock,
franchise, profits, withholding, social security (or similar), unemployment,
disability, real property, personal property, sales, use, transfer,
registration, value added, alternative or add-on minimum, estimated, or other
tax of any kind whatsoever, including any interest, penalty, or addition
thereto, whether disputed or not.
"Tax Return" means any return,
declaration, report, claim for refund, or information return or statement
relating to Taxes, including any schedule or attachment thereto, and including
any amendment thereof.
"Third-Party Claim" has the
meaning set forth in Section 8(d) below.
Section
2. Consideration and Sale of
Target Interests.
(a) Basic Transaction. On and
subject to the terms and conditions of this Agreement, Buyer agrees to purchase
from Parent, and Parent agrees to sell to Buyer, all of the Target Interests for
the consideration specified below in this Section 2.
(b) Consideration. As the sole
and complete consideration for the Target Interests, Buyer agrees
to:
(i) pay
to Parent Two Million One Hundred Fifteen Thousand Dollars
($2,115,000.00)(subject to adjustment as provided below)(the “Purchase Price”)
in cash or other immediately available funds at Closing.
(ii) assume
the following liabilities of Parent under that certain LLC Interest Purchase
Agreement dated February 1, 2008 (the “2008 Purchase Agreement”) by and among
Parent, Lawriter, Inc., a Nevada corporation and wholly owned subsidiary of
Parent (“Lawriter”), Target, XXXX.XXX LLC, an Ohio limited liability company
(“OSBA”), and Institute of Legal Publishing, Inc., an Ohio corporation
(“Lawcorp”)(OSBA and Lawcorp collectively, the “Sellers”):
(1) the
remaining obligations of Parent to OSBA under Section 2(b)(i)(A)(3)(y) of the
2008 Purchase Agreement and the obligations under the letter agreement between
Parent and OSBA dated April 3, 2009 related to the monthly fee credits owed to
OSBA until January 31, 2014;
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Exhibit
11.1
(2) the
payment obligations of Parent to Lawcorp in the amount of three (3) payments of
Seven Hundred Fifty Thousand Dollars ($750,000.00) to be paid on February 1,
2010, February 1, 2011 and February 1, 2012 pursuant to Section 2(b)(i)(B)(3) of
the 2008 Purchase Agreement related to the balance of the Fixed Payments owed to
Lawcorp; and
(3) the
payment obligations of Parent to Sellers under Section 2(b)(ii) of the 2008
Purchase Agreement related to the earnout owed to Lawcorp and OSBA.
(iii) assume
the payment obligations of Lawriter to OSBA under that certain Consulting
Agreement by and between Lawriter and OSBA dated February 1, 2008;
and
(iv) assume
the payment obligations of Lawriter to Lawcorp under that certain Consulting
Agreement by and between Lawriter and Xxxxxx X. Xxxx, III (“Xxxx”) dated
February 1, 2008.
(c) [Intentionally
left blank]
(d) Closing. On
the terms and subject to the conditions set forth in this Agreement, the closing
of the transaction (the “Closing”) shall take place on: (a) August 24, 2009 at
the offices of the Parent’s counsel, Xxxxxx X. Xxxxxxxx, Esq., in New York, New
York or (b) at such other time, on such other date and at such other place as
may be mutually agreed upon by the parties hereto. The date on which
the Closing is to occur is herein referred to as the “Closing Date.” The Closing
shall be effective at 11:59 p.m. Eastern Standard Time on the Closing
Date.
(e) Deliveries at Closing. At
the Closing, (i) Parent shall deliver to Buyer the various certificates,
instruments, and documents referred to in Section 7(a) below, (ii) Buyer will
deliver to Parent the various certificates, instruments, and documents referred
to in Section 7(b) below, (iii) if the Target Interests are certificated, Parent
will deliver to Buyer certificates representing all of the Target Interests,
endorsed in blank or accompanied by duly executed assignment documents, and (iv)
Buyer will deliver the consideration specified in Section 2(b)
above.
(f) Withholding Rights;
Deductions. Buyer shall be entitled
to deduct and withhold from any payment to any Person under this Agreement or
any related agreements such amounts as it is required to deduct and withhold
with respect to the making of such payment or any other Tax due on or before the
Effective Date. To the extent that amounts are so withheld or
deducted by Buyer such withheld amounts shall be treated for all purposes of
this Agreement as having been paid to such Person in respect of which such
deduction and withholding was made by the Buyer. Buyer will pay over
to the appropriate governmental entity amounts withheld under this
clause.
Section
3. Representations and
Warranties Concerning Transaction.
(a) Parent’s Representations and
Warranties. Parent represents and warrants to Buyer that the statements
contained in this Section 3(a) are correct and complete as of the date of this
Agreement and will be correct and complete as of the Closing Date (as though
made then and as though the Closing Date were substituted for the date of this
Agreement throughout this Section 3(a)), except as set forth in Annex I attached
hereto.
(i) Organization of Parent.
Parent is duly organized, validly existing, and in good standing under the laws
of the jurisdiction of its incorporation.
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Exhibit
11.1
(ii)
Authorization of
Transaction. Parent has full power and authority (including full
corporate power and authority) to execute and deliver this Agreement and to
perform its obligations hereunder. This Agreement constitutes the valid and
legally binding obligation of Parent, enforceable in accordance with its terms
and conditions. Parent need not give any notice to, make any filing with, or
obtain any authorization, consent, or approval of any government or governmental
agency in order to consummate the transactions contemplated by this Agreement.
The execution, delivery and performance of this Agreement and all other
agreements contemplated hereby have been duly authorized by Parent.
(iii)
Non-contravention.
Neither the execution and delivery of this Agreement, nor the consummation of
the transactions contemplated hereby, will (A) violate any constitution,
statute, regulation, rule, injunction, judgment, order, decree, ruling, charge,
or other restriction of any government, governmental agency, or court to which
Parent is subject or any provision of its charter, bylaws, or other governing
documents, (B) conflict with, result in a breach of, constitute a default under,
result in the acceleration of, create in any party the right to accelerate,
terminate, modify, or cancel, or require any notice under any agreement,
contract, lease, license, instrument, or other arrangement to which Parent is a
party or by which it is bound or to which any of its assets is subject, or (C)
result in the imposition or creation of a Lien upon or with respect to Target
Interests.
(iv)
Brokers' Fees. Except
for The Xxxxxx Xxxxxxxx Group, Inc. whose fees will be paid by Parent, no agent,
broker, investment banker or other person acting on behalf of Parent or under
the authority of Parent, is or will be entitled to any broker’s or finder’s fee
or any other commission or similar fee, directly or indirectly, from any of the
parties hereto in connection with the transaction contemplated by this
Agreement.
(v) Target Interests. Except as
otherwise provided in Section 3(a) of Annex I, Parent holds
all of the Target Interests, free and clear of any restrictions on transfer
(other than restrictions under the Securities Act and state securities laws),
taxes, Liens, options, warrants, purchase rights, contracts, commitments,
equities, claims, and demands. Except as otherwise provided in Section 3(a) of
Annex I, Parent
is not a party to any option, warrant, purchase right, or other contract or
commitment (other than this Agreement) that could require Parent to sell,
transfer, or otherwise dispose of all or any part of the Target Interests of
Target, and Parent is not a party to any voting trust, proxy, or other agreement
or understanding with respect to the voting of all or any part of the Target
Interests of Target.
(vi) Income Taxes of
Target. Parent has duly and timely filed all federal and state
Income Tax Returns relating to Target that it was required to file. Except for Income Taxes
set forth on Annex
I, which are being contested in good faith and by appropriate
proceedings, the following Income Taxes have (or by the Closing Date will have)
been duly and timely paid: (i) all Income Taxes shown to be due on the Income
Tax Returns filed or required to have been filed prior to the Effective Date,
(ii) all deficiencies and assessments of Income Taxes of which notice has (or by
the Effective Date will have) been received by Parent that are or may become
payable by Buyer or chargeable as a lien upon the Target or its assets, and
(iii) all other Income Taxes due on or before the Effective Date for which
neither filing of Income Tax Returns nor notice of deficiency or assessment is
required, of which Parent is or reasonably should be (or by the Effective Date
will be or reasonably should be) aware that are or may become payable by Buyer
or chargeable as a lien upon Target or its assets. Parent will file
and assume responsibility for filing and paying amounts due for all Income Tax,
Franchise Tax, and other Tax Returns for Parent and Target for fiscal
2009.
(b) Buyer's Representations and
Warranties. Buyer represents and warrants to Parent that the statements
contained in this Section 3(b) are correct and complete as of the date of this
Agreement and will be correct and complete as of the Closing Date (as though
made then and as though the Closing Date were substituted for the date of this
Agreement throughout this Section 3(b)), except as set forth in Annex II attached
hereto.
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Exhibit
11.1
(i) Organization of Buyer. Buyer
is a corporation (or other entity) duly organized, validly existing, and in good
standing under the laws of the jurisdiction of its incorporation (or other
formation).
(ii)
Authorization of
Transaction. Buyer has full power and authority (including full corporate
or other entity power and authority) to execute and deliver this Agreement and
to perform its obligations hereunder. This Agreement constitutes the valid and
legally binding obligation of Buyer, enforceable in accordance with its terms
and conditions. Buyer need not give any notice to, make any filing with, or
obtain any authorization, consent, or approval of any government or governmental
agency in order to consummate the transactions contemplated by this Agreement.
The execution, delivery and performance of this Agreement and all other
agreements contemplated hereby have been duly authorized by Buyer.
(iii)
Non-contravention.
Neither the execution and delivery of this Agreement, nor the consummation of
the transactions contemplated hereby, will (A) violate any constitution,
statute, regulation, rule, injunction, judgment, order, decree, ruling, charge,
or other restriction of any government, governmental agency, or court to which
Buyer is subject or any provision of its charter, bylaws, or other governing
documents or (B) conflict with, result in a breach of, constitute a default
under, result in the acceleration of, create in any party the right to
accelerate, terminate, modify, or cancel, or require any notice under any
agreement, contract, lease, license, instrument, or other arrangement to which
Buyer is a party or by which it is bound or to which any of its assets is
subject.
(iv)
Brokers' Fees. Buyer
has no liability or obligation to pay any fees or commissions to any broker,
finder, or agent with respect to the transactions contemplated by this
Agreement.
(v) Investment. Buyer is not
acquiring the Target Interests with a view to or for sale in connection with any
distribution thereof within the meaning of the Securities Act.
Section 4. Representations
and Warranties Concerning Target. Parent
represents and warrants to Buyer that the statements contained in this Section 4
are correct and complete as of the date of this Agreement and will be correct
and complete as of the Closing Date (as though made then and as though the
Closing Date were substituted for the date of this Agreement throughout this
Section 4), except as set forth in the disclosure schedule delivered by Parent
to Buyer on the date hereof and initialed by the Parties (the "Disclosure
Schedule").
(a) Organization, Qualification, and
Corporate Power. Target is a limited liability company duly organized,
validly existing, and in good standing under the laws of the jurisdiction of its
formation. Target is duly authorized to conduct business and in good standing
under the laws of each jurisdiction where such qualification is required, except
where the lack of such qualification would not have a Material Adverse Effect.
Target has full entity power and authority to carry on the business in which it
is engaged and all licenses, permits, and authorizations necessary to carry on
the businesses in which it is engaged and to own and use the properties owned
and used by it. Parent will deliver to Buyer at least five (5) days
prior to Closing correct and complete copies of the certificate of formation,
certificate of good standing, or other charter documents of Target and the
Target Operating Agreement, to the extent they exist (in each case amended to
date). There are no other agreements among Target and Parent relating
to or otherwise governing the issues reflected in the Target Operating
Agreement. Target is not in default under or in violation of any
provision of its charter or the Target Operating Agreement, if
any.
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Exhibit
11.1
(b) Capitalization. All of the
issued and outstanding Target Interests have been duly authorized, are validly
issued, fully paid and non-assessable, and are held of record by
Parent. There are (i) no outstanding or authorized options,
warrants, purchase rights, subscription rights, conversion rights, exchange
rights, or other contracts or commitments that could require Target to issue,
sell, or otherwise cause to become outstanding any equity of Target other than
the Target Interests held by the Parent; (ii) no outstanding or authorized
appreciation, phantom, profit participation, or similar rights with respect to
Target Interests; and (iii) no voting trusts, proxies, or other agreements or
understandings with respect to the voting of the limited liability company
interests of Target. All offers or sales of securities of Target have
been made in accordance with applicable securities laws, including compliance
with applicable exemptions under the Securities Act and applicable state
securities laws.
(c) Non-contravention. Neither
the execution and delivery of this Agreement, nor the consummation of the
transactions contemplated hereby, will (i) violate any constitution, statute,
regulation, rule, injunction, judgment, order, decree, ruling, charge, or other
restriction of any government, governmental agency, or court to which Target is
subject or any provision of the charter or Operating Agreement of Target or (ii)
except as otherwise described in 4(c) of the Disclosure Schedule,
conflict with, result in a breach of, constitute a default under, result in the
acceleration of, create in any party the right to accelerate, terminate, modify,
or cancel, or require any notice under any agreement, contract, lease, license,
instrument, or other arrangement to which Target is a party or by which it is
bound or to which any of its assets is subject (or result in the imposition of
any Lien upon any of its assets). Target does not need to give any notice to,
make any filing with, or obtain any authorization, consent, or approval of any
government or governmental agency in order for the Parties to consummate the
transactions contemplated by this Agreement, except where the failure to give
notice, to file, or to obtain any authorization, consent, or approval would not
have a Material Adverse Effect.
(d) Brokers' Fees. Target has no
liability or obligation to pay any fees or commissions to any broker, finder, or
agent with respect to the transactions contemplated by this
Agreement.
(e) Title to Assets.
Except as otherwise described in 4(e) of the Disclosure Schedule,
Target has good and marketable title to, or a valid leasehold interest in, the
properties and assets used by it, located on its premises, or otherwise shown on
the Most Recent Balance Sheet or acquired after the date thereof, free and clear
of all Liens or other Encumbrances, except for properties and assets disposed of
in the Ordinary Course of Business since the date of the Most Recent Balance
Sheet. Without limiting the generality of the foregoing, Target has
good and marketable title, free and clear of all Liens or other Encumbrances, to
all of the assets necessary for the conduct of its business, and as of the
Closing Date, will have good and marketable title, free and clear of all Liens
or other Encumbrances, to the federal registrations of the Lawriter and the
Casemaker trademarks now being used by Target in connection with its
business. Parent does not hold, own, claim or otherwise assert any
rights whatsoever to any property or right thereto used by Target in the
Ordinary Course of Business or otherwise owned by Target, except for the
“Mediator” and “Bankruptcy Dashboard” products.
(f) Financial Statements. Attached
hereto as Exhibit
A are the following financial statements (collectively the "Financial Statements"): (i)
balance sheet, statement of operations, and statement of cash flows for the five
month period ended June 30, 2008 which were included in the audited consolidated
financial statements of the Parent for its fiscal year ending June 30, 2008(the
“Most Recent Fiscal Year
End”); and (ii) unaudited balance sheet, statement of operations and
statement of cash flows (the "Most Recent Financial
Statements") as of and for the year ended June 30, 2009 for Target (the
"Most Recent Fiscal Year End),
and for the month ended July 31, 2009 (the “Most Recent Fiscal Month
End). The Financial Statements have been prepared in accordance with GAAP
throughout the periods covered thereby and present fairly the financial
condition of Target as of such dates and the results of operations of Target for
such periods; provided,
however, that the Most Recent Financial Statements are subject to normal
year-end adjustments and lack footnotes and other presentation items, which will
not, individually or in the aggregate cause a Material Adverse
Effect.
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Exhibit
11.1
(g) Events Subsequent to Most Recent
Fiscal Month End. Since the Most Recent Fiscal Month End, there has not
been any Material Adverse Change. Without limiting the generality of the
foregoing, since that date:
(i) Target
has not engaged in any practice, taken any action, or entered into any
transaction outside the Ordinary Course of Business the primary purpose or
effect of which has been to generate or preserve Cash;
(ii) Target
has not sold, leased, transferred, or assigned any assets, tangible or
intangible, outside the Ordinary Course of Business;
(iii) Target
has not imposed or suffered any Lien upon any of its assets, tangible or
intangible;
(iv) Target
has not made any capital expenditures outside the Ordinary Course of
Business;
(v) Target
has not made any capital investment in, or any loan to, any other Person outside
the Ordinary Course of Business;
(vi) Target
has not created, incurred, assumed, or guaranteed more than $10,000 in aggregate
indebtedness for borrowed money and capitalized lease obligations;
(vii) Target
has not transferred, assigned, or granted any license or sublicense of any
rights under or with respect to any Intellectual Property outside the Ordinary
Course of Business;
(viii) Target
has not issued, sold, or otherwise disposed of any limited liability company
interests, or granted any options, warrants, or other rights to purchase or
obtain (including upon conversion, exchange, or exercise) any such
interests;
(ix) Target
has not declared, set aside, or paid any dividend or made any distribution with
respect to its limited liability company interests (whether in cash or in kind)
or redeemed, purchased, or otherwise acquired any of such
interests;
(x) Target
has not experienced any damage, destruction, or loss (whether or not covered by
insurance) to its property, normal wear and tear excepted;
(xi) Target
has not made any loan to, or entered into any other transaction with, any of its
directors, officers, or employees outside the Ordinary Course of
Business;
(xii) Target
has not granted any increase in the base compensation or awarded any bonuses of
any of its directors or managers, officers, or employees outside the Ordinary
Course of Business;
(xiii) Target
has not made any change in employment terms for any of its directors or
managers, officers, or employees outside the Ordinary Course of
Business;
(xiv) Target
has not made any loans or advances of money; and
(xvi) Target
has not committed to any of the foregoing.
(h) Undisclosed Liabilities.
Target does not have any liability (whether known or unknown, whether
asserted or unasserted, whether absolute or contingent, whether accrued or
unaccrued, whether liquidated or unliquidated, and whether due or to become due,
including any liability for Taxes) of the type requiring financial statement
disclosure, except for (i) liabilities set forth on the face of the Most Recent
Financial Statements (rather than in any notes thereto) and (ii) liabilities
that have arisen after the Most Recent Fiscal Month End in the Ordinary Course
of Business.
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Exhibit
11.1
(i) Legal Compliance. Target has
complied with all applicable laws (including rules, regulations, codes, plans,
injunctions, judgments, orders, decrees, rulings, and charges thereunder) of
federal, state, local, and foreign governments (and all agencies thereof),
except where the failure to comply would not have a Material Adverse
Effect.
(j) Tax Matters.
(i)
Target has filed all Tax Returns that it was required to file on a timely basis.
All such Tax Returns as so filed are true and correct in all material respects
and disclose the true and correct distributable net income of the members
thereof for the periods covered thereby. All Taxes due and owing by Target
(whether or not shown on any Tax Return) have been paid, except to the extent
such Taxes are not due on or before the Effective Date. Target is not currently
the beneficiary of any extension of time within which to file any Tax Return.
There are no Liens for Taxes (other than Taxes not yet due and payable) upon any
of the assets of Target. Target has withheld and paid all Taxes required to have
been withheld and paid in connection with amounts paid or owing to any employee,
independent contractor, creditor, member, or other third party, and all Forms
W-2 and 1099 required with respect thereto have been properly completed and
timely filed.
(ii) There
is no dispute or claim concerning any Tax liability of Target either (A) claimed
or raised by any authority in writing or (B) as to which Parent and the
directors or managers or officers of Target have Knowledge based upon personal
contact with any agent of such authority.
(iii)
Parent has provided Buyer with correct and complete copies of all federal,
state, local, and foreign Tax Returns filed with respect to Target for taxable
periods ended on or after February 1, 2008. No such Tax Returns have been
audited or are currently the subject of audit. Parent has delivered to Buyer
correct and complete copies of all examination reports and statements of
deficiencies assessed against or agreed to by Target with respect to any Tax on
or since February 1, 2008. Target has not waived any statute of limitations in
respect of Taxes or agreed to any extension of time with respect to a Tax
assessment or deficiency.
(k) Real Property.
(i)
Target owns no Owned Real Property.
(ii)
Parent has provided Buyer with the address of each parcel of Leased Real
Property, and a true and complete list of all Leases for each such parcel of
Leased Real Property. Parent has delivered to Buyer a true and complete copy of
each Lease document. With respect to each of the Leases:
(A) such
Lease is legal, valid, binding, enforceable and in full force and
effect;
(B) the
transactions contemplated by this Agreement do not require the consent of any
other party to such Lease, will not result in a breach of or default under such
Lease, and will not otherwise cause such Lease to cease to be legal, valid,
binding, enforceable and in full force and effect on identical terms following
the Closing, except with respect to the Lease of Target’s headquarters
(“Headquarters Lease”) located at 000 Xxxx Xxxxxx, Xxxxx 000 Xxxxxxxxxx, Xxxx
00000. Target has secured Landlord’s approval to change of control
for said Headquarters Lease.
(C) neither
Target, nor any other party to the Lease is in breach of or default under such
Lease, and no event has occurred or circumstance exists that, with the delivery
of notice, the passage of time or both, would constitute such a breach or
default, or permit the termination, modification or acceleration of rent under
such Lease; and
(D) Target
has not subleased, licensed or otherwise granted any Person the right to use or
occupy the Leased Real Property or any portion thereof.
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Exhibit
11.1
(l) Intellectual
Property.
(i) Parent
has disclosed to Buyer the identity of all materials included in the database
made available in the Service and all computer software that is part of the
operation of the Service (collectively, the “Original Database and
Software”).
(ii) To
the Knowledge of Target and Parent, Target has not interfered with, infringed
upon, misappropriated or violated any Intellectual Property rights of third
parties; and neither of Parent or the directors, members or officers of Target
has ever received any charge, complaint, claim, demand, or notice alleging any
such interference, infringement, misappropriation, or violation (including any
claim that Target must license or refrain from using any Intellectual Property
rights of any third party), except in connection with the Jurisearch litigation
previously disclosed to Buyer, which has been withdrawn without prejudice. To
the Knowledge of Target, Parent, and the directors, members, or officers of
Target, no third party has interfered with, infringed upon, misappropriated, or
violated any Intellectual Property rights of Target (with, for purposes of this
Section 4(l)(ii), the definition of Knowledge to include knowledge that Target,
Parent, or the directors, members, or officers of Target reasonably could be
expected to discover or otherwise become aware of in the Ordinary Course of
Business or in the proper discharge of their obligations).
(iii)
Target Owned & Licensed IP. Section 4(l)(iii) of the Disclosure Schedule
identifies each license, sublicense, agreement, or other permission
that Target has granted to any third party with respect to the Original Database
and Software or any of its other Intellectual Property (together with any
exceptions). Target has no patents or registrations or applications with respect
thereto, or any copyright registrations or applications with respect thereto.
Target has delivered to Buyer correct and complete copies of all such licenses,
sublicenses, agreements, and permissions (as amended to date) which are in
writing. Section 4(l)(iii) of the Disclosure Schedule
also identifies each item of Intellectual Property not otherwise described in
Subsection (iv) below (including, without limitation, trade names or
unregistered trademarks, service marks, corporate names, Internet domain names,
copyright and computer software items) which is used by Target in connection
with its business, owned by or to which rights are held by Target, and the loss
of use of which could have a Material Adverse Effect. With respect to
each item of Intellectual Property owned by Target:
(A)
Target possesses all right, title, and interest in and to the item, free and
clear of any Lien, license, or other restriction;
(B) the
item is not subject to any outstanding injunction, judgment, order, decree,
ruling, or charge;
(C) no
action, suit, proceeding, hearing, investigation, charge, complaint, claim, or
demand is pending or is threatened that challenges the legality, validity,
enforceability, use, or ownership of the item; and
(D)
Target has not ever agreed to indemnify any Person for or against any
interference, infringement, misappropriation, or other conflict with respect to
the item.
(iv)
Third Party IP. Section 4(l)(iv) of the Disclosure Schedule
identifies (A) any part of the Original Database and Software that
any third party owns and that Target uses in connection with its business; and
(B) any item of Intellectual Property other than the Original Database and
Software that any third party owns, that Target uses, and that the loss of use
of which could have a Material Adverse Effect. Parent has delivered
to Buyer correct and complete copies of all such licenses, sublicenses,
agreements, and permissions (as amended to date) pursuant to which any such use
described under this Subsection is made. With respect to each such item of
Intellectual Property:
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Exhibit
11.1
(A) the
license, sublicense, agreement, or permission covering the item is legal, valid,
binding, enforceable, and in full force and effect in all
respects;
(B) no
party to the license, sublicense, agreement, or permission is in breach or
default, and no event has occurred that with notice or lapse of time would
constitute a breach or default or permit termination, modification, or
acceleration thereunder;
(C) no
party to the license, sublicense, agreement, or permission has repudiated any
provision thereof;
(D) Target has not granted any
sublicense or similar right with respect to the license, sublicense, agreement,
or permission; and
(E) no loss or expiration of the item
is threatened, pending, or reasonably foreseeable, except for patents expiring
at the end of their statutory terms (and not as a result of any act or omission
by Parent, Target, including a failure by Parent or Target to pay any required
maintenance fees).
(v)
Target owns or possesses or has the right to use (A) all of the Original
Database and Software, and (B) all other Intellectual Property used in or as is
necessary for the operation of its business as now being conducted and the loss
of use of which could have a Material Adverse Effect. Each item of Intellectual
Property owned or used by Target immediately prior to the Closing will be owned
or available for use by Target on identical terms and conditions immediately
subsequent to the Closing. Target has taken all necessary and desirable action
to maintain and protect each item of Intellectual Property that it owns or
uses.
(vi) The
foregoing representations and warranties, and all other applicable
representations and warranties in this Section 4, shall encompass the federal
registrations of the “Lawriter” and “Casemaker” trademarks owned by and
registered to Target.
(m) Contracts. Section
4(m) of the Disclosure
Schedule lists the following contracts and other agreements to which
Target is a party and pursuant to which either party thereto has any outstanding
performance obligation thereunder on the date of this Agreement:
(i) any
agreement (or group of related agreements) for the lease of personal property to
or from any Person providing for lease payments in excess of $10,000 per
annum;
(ii) any
agreement (or group of related agreements) for the purchase or sale of raw
materials and data, commodities, supplies, products, or other personal property,
or for the furnishing or receipt of Services, the performance of which will
extend over a period of more than one (1) year or involve consideration in
excess of $10,000;
(iii) any
agreement concerning a partnership or joint venture;
(iv) any
agreement (or group of related agreements) under which it has created, incurred,
assumed, or guaranteed any indebtedness for borrowed money, or any capitalized
lease obligation, in excess of $10,000 or under which it has imposed a Lien on
any of its assets, tangible or intangible;
(v) any
agreement concerning confidentiality or non-competition;
(vi) the
Thunderstone Agreement;
(vii) the
Trademark License Agreement;
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Exhibit
11.1
(viii)
any agreement for the employment of any individual on a full-time, part-time,
consulting, or other basis providing annual compensation in excess of $10,000 or
providing severance benefits;
(ix) any
agreement under which the consequences of a default or termination could have a
Material Adverse Effect; or
(x) any
other agreement (or group of related agreements) the performance of which
involves consideration in excess of $10,000.
Parent
has delivered to Buyer a correct and complete copy of each such written
agreement (as amended to date) and a written summary setting forth the terms and
conditions of each such agreement which is oral. With respect to each such
agreement: (A) the agreement is legal, valid, binding, enforceable and in full
force and effect, and the other party to such agreement has no right to modify
or terminate the same as a result of the consummation of the transactions
contemplated hereby; (B) no party is in breach or default and no event has
occurred that with notice or lapse of time would constitute a breach or default,
or permit termination, modification, or acceleration, under the agreement; and
(C) no party has repudiated any provision of the agreement.
(n) Notes and Accounts
Receivable. All notes and accounts receivable of Target are reflected
properly on its books and records, are valid receivables subject to no setoffs
or counterclaims, are current and collectible, and will be collected in
accordance with their terms at their recorded amounts, subject only to the
reserve for bad debts set forth on the face of the Most Recent Financial
Statements (rather than in any notes thereto) as adjusted for operations and
transactions through the Closing Date in accordance with the past custom and
practice of Target.
(o) Powers of Attorney. To the
Knowledge of Parent, there are no outstanding powers of attorney executed on
behalf of Target.
(p) Insurance. Section 4(p) of
the Disclosure
Schedule sets forth the following information with respect to each
insurance policy (including policies providing property, casualty, liability,
and workers’ compensation coverage and bond and surety arrangements) with
respect to which Target is a party, a named insured, or otherwise the
beneficiary of coverage:
(i) the
name, address, and telephone number of the agent;
(ii) the
name of the insurer, the name of the policyholder, and the name of each covered
insured;
(iii) the
policy number and the period of coverage;
(iv)
the scope (including an indication of whether the coverage is on a claims made,
occurrence, or other basis) and amount (including a description of how
deductibles and ceilings are calculated and operate) of coverage;
and
(v) description
of any retroactive premium adjustments or other loss-sharing
arrangements.
(q) Litigation. Target (i) is not
subject to any outstanding injunction, judgment, order, decree, ruling, or
charge and (ii) is not a party or, to the Knowledge of Target, Parent, or any
director, manager, or officer of Target, is not threatened to be made a party,
to any action, suit, proceeding, hearing, or investigation of, in, or before any
court or quasi-judicial or administrative agency of any federal, state, local,
or foreign jurisdiction, except where the injunction, judgment, order, decree,
ruling, action, suit, proceeding, hearing, or investigation would not have a
Material Adverse Effect and except for the Jurisearch litigation previously
disclosed to Buyer, which has been withdrawn without prejudice.
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Exhibit
11.1
(r) Employees. To
the Knowledge of Target, Parent, or any director, manager, or officer of Target,
no executive, key employee or significant group of employees plans to terminate
employment with Target during the next twelve (12) months. Target is not a party
to or bound by any collective bargaining agreement, nor has it experienced any
strike or grievance, claim of unfair labor practices, or other collective
bargaining dispute within the past three (3) years. Target has not committed any
unfair labor practice. There are no organizational efforts presently being made
or threatened by or on behalf of any labor union with respect to employees of
Target. Within the past three (3) years, Target has not implemented any plant
closing or layoff of employees that could implicate the Worker Adjustment and
Retraining Notification Act of 1988, as amended, (the “WARN Act”), and no such
action will be implemented without advance notification to Buyer
(s) Employee
Benefits.
(i)
Section 4(s) of the Disclosure Schedule
lists each Employee Benefit Plan that Target maintains or to which Target
contributes.
(A) To
the Knowledge of Parent, each such Employee Benefit Plan (and each related
trust, insurance contract, or fund) has been maintained, funded and administered
in accordance with the terms of such Employee Benefit Plan and complies in form
and in operation in all respects with the applicable requirements of ERISA and
the Code, except where the failure to comply would not have a Material Adverse
Effect.
(B) All
premiums or other payments that are due have been paid with respect to each such
Employee Benefit Plan that is an Employee Welfare Benefit Plan.
(C) Each
such Employee Benefit Plan that is intended to meet the requirements of a
"qualified plan" under Code Section 401(a) has received a determination letter
from the Internal Revenue Service to the effect that it meets the requirements
of Code Section 401(a).
(ii)
Neither Target nor any of its Subsidiaries maintains, sponsors or contributes to
any Employee Pension Benefit Plan that is a "defined benefit plan" (as defined
in ERISA Section 3(35)).
(t)
Guaranties. Target is
not a guarantor or otherwise is responsible for any liability or obligation
(including indebtedness) of any other Person, except with respect to the
indebtedness of Parent to Alpha Capital Anstalt, which guarantee will be
terminated prior to the Closing.
(u)
Disclosure. None of the representations or warranties
made by any Parent in this Agreement, nor any statement made in any Schedule or
any certificate, instrument or document furnished by any Parent pursuant to this
Agreement, when taken together, contains any untrue statement of a material
fact, or omits to state any material fact necessary in order to make the
statements and information contained herein or therein, in the light of the
circumstances under which they were made, not misleading.
Section 5. Pre-Closing
Covenants. The
Parties agree as follows with respect to the period between the execution of
this Agreement and the Closing.
(a) General. Each of the Parties
will use its best efforts to take all actions and to do all things necessary in
order to consummate and make effective the transactions contemplated by this
Agreement (including satisfaction, but not waiver, of the Closing conditions set
forth in Section 7 below). More specifically, Parent shall have
undertaken or caused the following actions immediately prior to or upon and
coincident with Closing:
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(1)
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That
certain Contract of Sale by and among Parent, Target and Lawcorp dated as
of April 1, 2009 shall have been fully performed by Parent and
Target.
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Exhibit
11.1
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(2)
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Parent
or Target shall have satisfied in full all outstanding payment obligations
of Target for legal services owed to Xxxxxx, Xxxxxx and Xxxxxxx, LLC
related to the defense of the JuriSearch
litigation.
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(3)
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Parent’s
obligations under that certain Escrow Agreement by and among Target,
Parent, Lawriter, OSBA and Escrow Associates, LLC dated as of February 1,
2008 shall have been assigned to
Buyer;
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(4)
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Parent
and buyer shall have entered into a Letter of Distribution in a form
mutually acceptable to both
parties;
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(5)
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That
certain license agreement with VersusLaw shall have been assigned by
Parent to Target;
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(6)
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Target
shall have been released of any and all of its obligations to Alpha
Capital Anstalt (“Anstalt”), including, without limitation, that certain
Guaranty and Security Agreement entered into by and among Target, Anstalt
and others dated March 4, 2009;
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(7)
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All
intercompany liabilities between Target and Parent will be converted to
capital contributions or otherwise released;
and
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(8)
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Buyer
and Seller have reached an agreement in principle to approve the
assumption of the earnout obligations under the 2008 Purchase
Agreement. Parties anticipate executed definitive agreements
between Buyer and Seller prior to closing, which agreements are a
condition of closing and subject to Seller’s waiver of this
condition.
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(b) Notices and Consents. Parent
shall cause Target to give any notices to third parties, and shall cause Target
to use commercially reasonable efforts to obtain any third party consents,
referred to in Section 4(c) above. Each of the Parties will (and Parent will
cause Target to) give any notices to, make any filings with, and use
commercially reasonable efforts to obtain any authorizations, consents and
approvals of governments and governmental agencies in connection with the
matters referred to in Section 3(a)(ii), Section 3(b)(ii) and Section 4(c)
above.
(c) Operation of Business. Parent
will not cause or permit Target to engage in any practice, take any action, or
enter into any transaction outside the Ordinary Course of Business.
(d) Preservation of Business.
Target shall keep its business and properties substantially intact,
including their present operations, physical facilities, working conditions,
insurance policies, and relationships with lessors, licensors, suppliers,
customers, and employees.
(e) Full Access. Parent will
permit, and Parent will cause Target to permit, representatives of Buyer
(including legal counsel and accountants) to have full access at reasonable
times to be mutually determined, and in a manner that will not to interfere with
the normal business operations of Target, to all premises, properties,
personnel, books, records (including tax records), contracts, and documents of
or pertaining to Target. Buyer will treat and hold as such any Confidential
Information it receives from any of Parent and Target in the course of the
reviews contemplated by this Section 5(e), will not use any of the Confidential
Information except in connection with this Agreement and, if this Agreement is
terminated for any reason whatsoever, will return to Parent and Target all
tangible embodiments (and all copies) of the Confidential Information that are
in its possession.
(f) Notice of
Developments. Parent or Target, as applicable, will give
prompt written notice to Buyer of any development causing a breach of any of the
representations and warranties in Section 4 above. Each Party will give prompt
written notice to the others of any development causing a breach of any of its
own representations and warranties in Section 3 above. No disclosure by any
Party pursuant to this Section 5(f), however, shall be deemed to amend or
supplement the Disclosure Schedule
or to prevent or cure any misrepresentation, breach of warranty, or breach of
covenant
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Exhibit
11.1
(g) Exclusivity. Parent will not
(and Parent shall not cause or permit Target to) (i) solicit, initiate, or
encourage the submission of any proposal or offer from any Person other than
Buyer relating to the acquisition of any limited liability company interests or
other voting securities, or any substantial portion of the assets, of Target
(including any acquisition structured as a merger, consolidation, or
interests/share exchange), or (ii) participate in any discussions or
negotiations regarding, furnish any information with respect to, assist or
participate in, or facilitate in any other manner any effort or attempt by any
Person other than Buyer to do or seek any of the foregoing. Parent will notify
Buyer immediately if any Person makes any proposal, offer, inquiry or contact
with respect to any of the foregoing.
(h) Leases. Target
will not cause or permit any Lease to be amended, modified, extended, renewed or
terminated, nor shall Target enter into any new lease, sublease, license or
other agreement for the use or occupancy of any Leased Real Property, without
the prior written consent of Buyer.
(i) Tax Matters. Without the
prior written consent of Buyer, Target shall not make or change any election,
change an annual accounting period, adopt or change any accounting method, file
any amended Tax Return, enter into any closing agreement, settle any Tax claim
or assessment relating to Target, surrender any right to claim a refund of
Taxes, consent to any extension or waiver of the limitation period applicable to
any Tax claim or assessment relating to Target, or take any other similar action
relating to the filing of any Tax Return or the payment of any Tax, if such
election, adoption, change, amendment, agreement, settlement, surrender, consent
or other action would have the effect of increasing the Tax liability of Target
for any period ending after the Closing Date or decreasing any Tax attribute of
Target existing on the Closing Date.
Section 6. Post-Closing
Covenants. The
Parties agree as follows with respect to the period following the
Closing.
(a) General. In case at any time
after the Closing any further action is necessary to carry out the purposes of
this Agreement, each of the Parties will take such further action (including the
execution and delivery of such further instruments and documents) as any other
Party reasonably may request, all at the sole cost and expense of the requesting
Party (unless the requesting Party is entitled to indemnification therefor under
Section 8 below). Parent and Target acknowledge and agree that from and
after the Closing Buyer will be entitled to possession of all documents, books,
records (including tax records), agreements, and financial data of any sort
relating to Target, its business and assets; provided, however, that Parent
shall be entitled to retain or to receive copies of all such documents and
financial data and to use the same to fulfill its obligations under this
Agreement or in connection with the termination of its ownership of Target; and
provided, further, that any and
all such documents and data shall constitute the Proprietary Information (as
defined below) of Target and as a consequence thereof, shall be subject to the
terms and conditions of Section 6(d) below.
(b) Litigation Support. In the
event and for so long as any Party actively is contesting or defending against
any action, suit, proceeding, hearing, investigation, charge, complaint, claim,
or demand in connection with (i) any transaction contemplated under this
Agreement or (ii) any fact, situation, circumstance, status, condition,
activity, practice, plan, occurrence, event, incident, action, failure to act,
or transaction on or two years prior to the Closing Date involving Target, each
of the other Parties shall cooperate with it and its counsel in the defense or
contest, make available its personnel, and provide such testimony and access to
its books and records as shall be necessary in connection with the defense or
contest, all at the sole cost and expense of the contesting or defending Party
(unless the contesting or defending Party is entitled to indemnification
therefor under Section 8 below).
(c) Transition. Parent will not
take any action that is designed or intended to have the effect of discouraging
any lessor, licensor, customer, supplier, or other business associate of Target
from maintaining the same business relationships with Target after the Closing
as it maintained with Target prior to the Closing.
(d) Confidentiality.
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Exhibit
11.1
(i) As
used in this Agreement, the term “Proprietary Information”
means, with respect to any Person, collectively all Trade Secrets and
Confidential Information (each as defined below), whether written or oral,
furnished (whether before or after the date hereof) or otherwise made available
by such Person or its owners, members, partners, directors, managers, officers,
employees, Affiliates, representatives (including its financial advisors,
attorneys and accountants) or agents (collectively, “Representatives”) to any
other Person or its Representatives, and all analyses, compilations, forecasts,
studies, notes or other documents prepared by such other Person or its
Representatives in connection with the transactions contemplated by this
Agreement or which contain or reflect any such information; provided, however, that the
term “Proprietary Information” shall not include information that (A) is or
becomes publicly available other than as a result of a disclosure by any Person
or its Representatives in violation of this Agreement, or (B) is or becomes
available to such other Person on a non-confidential basis from a source that is
not prohibited from disclosing such information by any legal, contractual or
fiduciary obligation.
(ii) Parent
(“Receiving Party”)
shall keep all Proprietary Information of Buyer and, after the Closing, of
Target confidential and shall not (except as required by applicable law,
regulation or legal process, and then only after compliance with the last
sentence of this Section) without the prior written consent of Buyer, disclose
any such Proprietary Information in any manner whatsoever or use any such
Proprietary Information for any purpose whatsoever except for the purposes
expressly contemplated by this Agreement; provided, however, that a
Receiving Party may reveal such Proprietary Information to its Representatives
(A) who need to know such Proprietary Information for the purposes contemplated
by this Agreement, (B) who are informed by such Parent of the confidential
nature of the Proprietary Information, and (C) who agree to act in accordance
with the terms of this Section. In the event that any Receiving Party
or any of its Representatives is requested pursuant to, or required by,
applicable law, regulation or legal process to disclose any such Proprietary
Information, that Person must notify Buyer promptly so that it may seek a
protective order or other appropriate remedy or, in its sole and absolute
discretion, waive compliance with the terms of this Section. In any event, such
Receiving Party may furnish only that portion of such Proprietary Information
that it is advised by counsel is legally required and shall exercise all
commercially reasonable efforts to obtain reliable assurance, to the extent it
is possible to obtain the same, that confidential treatment will be afforded to
such Proprietary Information.
(iii) Each
Receiving Party recognizes and acknowledges that any breach of its covenants in
this Section will cause irreparable and material loss and damage to Buyer, the
amount of which cannot be determined readily and as to which Buyer will not have
an adequate remedy at law or in damages. Accordingly, in addition to
any remedy Buyer may have in damages by an action at law, Buyer shall be
entitled to the issuance of an injunction restraining any such breach or
threatened breach or any other remedy at law or in equity for any such
breach.
(iv) For
purposes hereof, “Trade
Secrets” means information of a Person or its Affiliates, without regard
to form, which: (a) derives economic value, actual or potential, from
not being generally known to, and not being readily ascertainable by proper
means by, other Persons who can obtain economic value from its disclosure or
use; and (b) is the subject of efforts that are reasonable under the
circumstances to maintain its secrecy. “Confidential Information”
means any information of a Person or its Affiliates, other than Trade Secrets,
that is of value to such Person or its Affiliates and not generally known to
their competitors, including such information held by a court of competent
jurisdiction not to rise to the level of a Trade Secret under applicable
law.
(v) Notwithstanding
anything herein to the contrary, Parent and Buyer acknowledge, and
agree that the existence of this Agreement and the transactions contemplated
shall not be considered Proprietary Information and each party hereby consents
to the disclosure of such information following the Effective
Date.
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Exhibit
11.1
(d) Covenant Not to Compete. For
a period of three (3) years from and after the Closing Date, Parent will not
engage directly or indirectly in any business that Target conducts as of the
Closing Date in any geographic area in which Target conducts that business as of
the Closing Date; provided,
however, that no owner of less than 5% of the outstanding stock of any
publicly traded corporation shall be deemed to engage solely by reason thereof
in its business. If the final judgment of a court of competent
jurisdiction declares that any term or provision of this Section 6(d) is invalid
or unenforceable, the Parties agree that the court making the determination of
invalidity or unenforceability shall have the power to reduce the scope,
duration, or area of the term or provision, to delete specific words or phrases,
or to replace any invalid or unenforceable term or provision with a term or
provision that is valid and enforceable and that comes closest to expressing the
intention of the invalid or unenforceable term or provision, and this Agreement
shall be enforceable as so modified after the expiration of the time within
which the judgment may be appealed.
Section
7. Conditions to Obligation to
Close.
(a) Conditions to Buyer's
Obligation. Buyer's
obligation to consummate the transactions to be performed by it in connection
with the Closing is subject to satisfaction of the following
conditions:
(i)
the representations and warranties set forth in Section 3(a) and Section 4 above
shall be true and correct in all material respects at and as of the Closing
Date;
(ii)
Parent shall have performed and complied with all of their covenants hereunder
in all material respects through the Closing;
(iii)
no action, suit, or proceeding shall be pending before any court or
quasi-judicial or administrative agency of any federal, state, local, or foreign
jurisdiction or before any arbitrator wherein an unfavorable injunction,
judgment, order, decree, ruling, or charge would (A) prevent consummation of any
of the transactions contemplated by this Agreement, (B) cause any of the
transactions contemplated by this Agreement to be rescinded following
consummation, (C) adversely affect the right of Buyer to own the Target
Interests and to control Target, or (D) materially and adversely affect the
right of Target to own its assets and to operate its business (and no such
injunction, judgment, order, decree, ruling, or charge shall be in
effect);
(iv)
Parent shall have delivered to Buyer a certificate to the effect that each of
the conditions specified above in Section 7(a)(i)-(iii) is satisfied in all
respects;
(v)
the Parties shall have received all other material authorizations, consents, and
approvals of governments and governmental agencies referred to in Section
3(a)(ii), Section 3(b)(ii), and Section 4(c) above;
(vi)
Buyer shall have received the resignations, effective as of the Closing, of each
director or manager and officer of Target;
(vii)
Buyer shall have received evidence that the Lawriter and the Casemaker
trademarks now being used by Target are owned and titled to Target;
(viii) all
actions to be taken by Parent in connection with consummation of the
transactions contemplated hereby and all certificates, opinions, instruments,
and other documents required to effect the transactions contemplated hereby will
be reasonably satisfactory in form and substance to Buyer;
(ix) Parent
shall have delivered to Buyer a copy of the certificate of formation, including
all amendments to date, of Target, certified on or soon before the Closing Date
by the Secretary of State of the jurisdiction of Target’s
formation;
Page
19
Exhibit
11.1
(x)
Parent shall have delivered to Buyer copies of the certificate of existence of
Target, issued on or soon before the Closing Date by the Secretary of State of
the jurisdiction of Target’s organization;
(xi)
Pursuant to Section 11(d) of the 2008 Purchase Agreement, Sellers shall have
consented in writing to the transactions contemplated under this Agreement,
including the assumption by Buyer of those liabilities of Parent to Sellers
under Section 2(b)(ii) hereof;
(xii) That certain Contract of Sale by
and among Parent, Target and Lawcorp dated as of April 1, 2009 shall have been
fully performed by Parent and Target, and all rights of the parties released
thereto;
(xiii) Parent or Target shall have satisfied in full all
outstanding payment obligations of Target for legal services owed to Xxxxxx,
Xxxxxx and Xxxxxxx, LLC related to the defense of the JuriSearch
litigation;
(xiv) Buyer,
Target and OSBA shall have entered into an Escrow Agreement securing those OSBA
obligations assumed by Buyer from Parent pursuant to Section 2(b)(ii)
hereof;
(xv) [Intentionally
left blank]
(xvi) Parent
and Target shall have entered into a License Agreement for the Parent
Assets;
(xvii) That
certain license agreement with VersusLaw shall have been assigned by Parent to
Target;
(xviii) Target
shall have been released of any and all of its obligations to Alpha Capital
Anstalt (“Anstalt”), including, without limitation, that certain Guaranty and
Security Agreement entered into by and among Target, Anstalt and others dated
March 4, 2009;
(xix)
Target shall have been released of any and all of its obligations to the Sellers
under the 2008 Purchase Agreement, except for the Security
Agreement;
(xx) All
intercompany liabilities between Target and Parent will be converted to capital
contributions or otherwise released, including but not limited to, those certain
loans in the approximate aggregate amount of $100,000.00 made by Parent to
Target;
(xxi) Buyer
shall have approved that certain schedule of payments and flow of funds
submitted by Parent to Buyer; and
(xxii)
Parent shall have made such other deliveries as are described as being its
responsibility in Section 2(e) above.
Buyer may
waive any condition specified in this Section 7(a) if it executes a writing so
stating at or prior to the Closing.
(b) Conditions to Parent’s Obligation.
Parent’s obligation to consummate the transactions to be performed by it
in connection with the Closing is subject to satisfaction of the following
conditions:
(i) the
representations and warranties set forth in Section 3(b) above shall be true and
correct in all material respects at and as of the Closing Date;
(ii)
Buyer shall have performed and complied with all of its covenants hereunder in
all material respects through the Closing;
Page
20
Exhibit
11.1
(iii)
there shall not be any injunction, judgment, order, decree, ruling, or charge in
effect preventing consummation of any of the transactions contemplated by this
Agreement;
(iv)
Buyer shall have delivered to Parent a certificate to the effect that each of
the conditions specified above in Section 7(b)(i)-(iii) is satisfied in all
respects;
(v) the
Parties, Target, and its Subsidiaries shall have received all authorizations,
consents, and approvals of governments and governmental agencies referred to in
Section 3(a)(ii), Section 3(b)(ii), and Section 4(c) above;
(vii) all
actions to be taken by Buyer in connection with consummation of the transactions
contemplated hereby and all certificates, opinions, instruments, and other
documents required to effect the transactions contemplated hereby will be
reasonably satisfactory in form and substance to Parent;
(viii) the
dismissal with prejudice by JuriSearch of that certain lawsuit brought by
JuriSearch against Target and Parent and the execution of a release by
JuriSearch of any and all claims relating thereto; and
(ix) Buyer
shall have made such other deliveries as are described as being its
responsibility in Section 2(e) above.
Parent
may waive any condition specified in this Section 7(b) if it executes a writing
so stating at or prior to the Closing.
Section
8. Remedies for Breaches of
This Agreement.
(a) Survival of Representations and
Warranties. All of the representations and warranties of
Parent contained in Section 4 above shall survive the Closing hereunder (unless
Buyer knew or had reason to know of any misrepresentation or breach of warranty
at the time of Closing) and continue in full force and effect for a period of
twenty four (24) months thereafter. All of the representations and warranties of
the Parties contained in Section 3 above shall survive the Closing (unless the
damaged Party knew or had reason to know of any misrepresentation or breach of
warranty at the time of Closing) and continue in full force and effect forever
thereafter (subject to any applicable statutes of limitations).
(b) Indemnification Provisions for
Buyer's Benefit.
(i) In
the event Parent breaches any of its representations, warranties, and covenants
contained herein (other than the covenants in Section 2(a) above or the
representations and warranties in Section 3(a) above), and, provided that Buyer
makes a written claim for indemnification against Parent pursuant to Section
10(i) below within the survival period (if there is an applicable survival
period pursuant to Section 8(a) above), then Parent shall defend and indemnify
Buyer from and against the Adverse Consequences Buyer shall suffer caused
proximately by the breach; provided, however, that
Parent shall not have any obligation to indemnify Buyer from and against any
Adverse Consequences caused by the breach of any representation or warranty or
covenant of Parent contained in Section 4 above (A) until Buyer has suffered
Adverse Consequences by reason of all such breaches in excess of a $25,000 in
the aggregate (at which point Parent shall have liability with respect to the
first dollar of such Adverse Consequences) and thereafter (B) to the extent the
Adverse Consequences Buyer has suffered by reason of all such breaches up to
$1,000,000.00 (after which point Parent will have no obligation to indemnify
Buyer from and against further such Adverse Consequences). Without
limiting the generality of the foregoing, Parent indemnification obligation
shall include any Taxes, Interest, and Penalties that were due prior
to the Effective Date of this Agreement that are identified as a result of Tax
authority assessments.
Page
21
Exhibit
11.1
(ii) In
the event Parent breaches any of its covenants in Section 2(a) above or any of
its representations and warranties in Section 3(a) above or any claim that may
be asserted by (1) Xxxx with respect to matters occurring on or before August 1,
2009 under that certain consulting agreement entered into by and between Xxxx
and Lawriter (as assumed by Parent), excluding the payment obligations assumed
by Buyer under Section 2(b)(iv) above, (2) OSBA with respect to matters
occurring on or before August 1, 2009 under that certain consulting
agreement entered into by and between OSBA and Lawriter (as assumed by Parent),
excluding the payment obligations assumed by Buyer under Section 2(b)(iii)
above, or (3) all or any one of Sellers for claims that may arise under the 2008
Purchase Agreement, except for those payment obligations assumed by Buyer under
Section 2(b)(ii) above, or any documents ancillary to the 2008 Purchase
Agreement and provided that Buyer makes a written claim for indemnification
against such Parent pursuant to Section 10(i) below within the survival period
(if there is an applicable survival period pursuant to Section 8(a) above), then
such Parent shall defend and indemnify Buyer from and against the entirety of
any Adverse Consequences Buyer shall suffer through and after the date of the
claim for indemnification caused proximately by such Parent's breach,
any such claim asserted under the referenced consulting agreements or
the 2008 Purchase Agreement, as the case may be.
(c) Indemnification Provisions for
Parent’s Benefit. In the event Buyer breaches any of its representations,
warranties, and covenants contained herein, and provided that Parent makes a
written claim for indemnification against Buyer pursuant to Section 10(i) below
within the survival period (if there is an applicable survival period pursuant
to Section 8(a) above), then Buyer shall defend and indemnify Parent from and
against the entirety of any Adverse Consequences suffered (but excluding any Adverse
Consequences suffered after the end of any applicable survival period) caused
proximately by the breach.
(d) Matters Involving Third
Parties.
(i) If
any third party shall notify any Party (the "Indemnified Party") with
respect to any matter (a "Third-Party Claim") which may
give rise to a claim for indemnification against any other Party (the "Indemnifying Party") under
this Section 8, then the Indemnified Party shall promptly (and in any event
within 5 business days after receiving notice of the Third-Party Claim) notify
each Indemnifying Party thereof in writing.
(ii) Any
Indemnifying Party will have the obligation to assume and thereafter conduct the
defense of the Third-Party Claim with counsel of its choice reasonably
satisfactory to the Indemnified Party; provided, however, that the
Indemnifying Party will not consent to the entry of any judgment or enter into
any settlement with respect to the Third-Party Claim without the prior written
consent of the Indemnified Party (not to be unreasonably withheld) unless the
judgment or proposed settlement involves only the payment of money damages and
does not impose an injunction or other equitable relief upon the Indemnified
Party.
(iii)
Unless and until an Indemnifying Party assumes the defense of the Third-Party
Claim as provided in Section 8(d)(ii) above, however, the Indemnified Party may
defend against the Third-Party Claim in any manner it may reasonably deem
appropriate.
(iv) In
no event will the Indemnified Party consent to the entry of any judgment on or
enter into any settlement with respect to the Third-Party Claim without the
prior written consent of each of the Indemnifying Parties (not to be
unreasonably withheld).
(e) Determination of Adverse
Consequences. All indemnification payments under this Section 8 shall be
paid by the Indemnifying Party net of any Tax benefits and insurance coverage
that may be available to the Indemnified Party and shall be adjusted to take
into account the time cost of money (using the Applicable Rate as the discount
rate). All indemnification payments under this Section 8 shall be deemed
adjustments to the Purchase Price.
Page
22
Exhibit
11.1
(f) Exclusive Remedy. Except for
breach of representations made in Sections 2(a) and 3(a) hereinabove, Buyer and
Parent acknowledge and agree that the foregoing indemnification provisions in
this Section 8 shall be the exclusive remedy of Buyer and Parent with respect to
Target and the transactions contemplated by this Agreement.
Section
9. Termination.
(a) Termination of
Agreement. Certain
of the Parties may terminate this Agreement as provided below:
(i) Buyer
and Parent may terminate this Agreement by mutual written consent at any time
prior to the Closing;
(ii)
Buyer may terminate this Agreement by giving written notice to Parent at any
time prior to the Closing in the event (A) Parent has within the then previous
10 business days given Buyer any notice pursuant to Section 5(f) above and (B)
the development that is the subject of the notice has had a Material Adverse
Effect;
(iii)
Buyer may terminate this Agreement by giving written notice to Parent at any
time prior to the Closing (A) in the event Parent has breached any material
representation, warranty, or covenant contained in this Agreement (other than
the representations and warranties in Section 4 above) in any material respect,
Buyer has notified Parent of the breach, and the breach has continued without
cure for a period of 30 days after the notice of breach or (B) if the Closing
shall not have occurred on or before August 31, 2009, by reason of the failure
of any condition precedent under Section 7(a) hereof and through no fault of
Buyer (unless the failure results primarily from Buyer itself breaching any
representation, warranty, or covenant contained in this Agreement);
and
(iv)
Parent may terminate this Agreement by giving written notice to Buyer at any
time prior to the Closing (A) in the event Buyer has breached any material
representation, warranty, or covenant contained in this Agreement in any
material respect, Parent has notified Buyer of the breach, and the breach has
continued without cure for a period of 30 days after the notice of breach or (B)
if the Closing shall not have occurred on or before August 31, 2009, by reason
of the failure of any condition precedent under Section 7(b) hereof and through
no fault of Parent (unless the failure results primarily from Parent breaching
any representation, warranty, or covenant contained in this
Agreement).
(b) Effect of Termination. If
any Party terminates this Agreement pursuant to Section 9(a) above, all rights
and obligations of the Parties hereunder shall terminate without any liability
of any Party to any other Party (except for any liability of any Party then in
breach); provided,
however, that the confidentiality provisions contained in Section 5(d)
above shall survive termination.
Section
10.
Miscellaneous.
(a) [Reserved.]
(b) Press Releases and Public
Announcements. No Party shall issue any press release or make any public
announcement relating to the subject matter of this Agreement without the prior
written approval of Buyer and Parent; provided, however, that any
Party may make any public disclosure it believes in good faith is required by
applicable law or any listing or trading agreement concerning its publicly
traded securities (in which case the disclosing Party will use its commercially
reasonable efforts to advise the other Parties prior to making the
disclosure).
(c) No Third-Party Beneficiaries.
This Agreement shall not confer any rights or remedies upon any Person
other than the Parties and their respective successors and permitted
assigns.
Page
23
Exhibit
11.1
(d) No Code Section 338 Election.
Neither Buyer nor Target or any Affiliate thereof shall make any election
under Code Section 338 with respect to the transactions contemplated by this
Agreement.
(e) Entire Agreement. This
Agreement (including the documents referred to herein) constitutes the entire
agreement among the Parties and supersedes any prior understandings, agreements,
or representations by or among the Parties, written or oral, to the extent they
relate in any way to the subject matter hereof.
(f) Succession and Assignment.
This Agreement shall be binding upon and inure to the benefit of the
Parties named herein and their respective successors and permitted assigns. No
Party may assign either this Agreement or any of its rights, interests, or
obligations hereunder without the prior written approval of Buyer and Parent;
provided, however, that
Buyer may (i) assign any or all of its rights and interests hereunder to one or
more of its Affiliates and (ii) designate one or more of its Affiliates to
perform its obligations hereunder (in any or all of which cases Buyer
nonetheless shall remain responsible for the performance of all of its
obligations hereunder).
(g) Counterparts. This Agreement
may be executed in one or more counterparts (including by means of facsimile),
each of which shall be deemed an original but all of which together will
constitute one and the same instrument.
(h) Headings. The section
headings contained in this Agreement are inserted for convenience only and shall
not affect in any way the meaning or interpretation of this
Agreement.
(i) Notices. All
notices, requests, demands, claims, and other communications hereunder shall be
in writing. Any notice, request, demand, claim, or other communication hereunder
shall be deemed duly given (i) when delivered personally to the recipient, (ii)
1 business day after being sent to the recipient by reputable overnight courier
service (charges prepaid), (iii) 1 business day after being sent to the
recipient by facsimile transmission or electronic mail, or (iv) 4 business days
after being mailed to the recipient by certified or registered mail, return
receipt requested and postage prepaid, and addressed to the intended recipient
as set forth below:
|
If
to Parent:
c/o
Xxxxxxx X. Xxxxxxxx
0000
Xxxx Xxxxxx, Xxxxx 000
Xxxxxxxx,
XX 00000
|
Copy
to:
Xxxxxx
X. Xxxxxxxx
0000
Xxxxxxxx, 00xx
Xxxxx
Xxx
Xxxx, XX 00000
|
|
If
to Buyer:
SSN
HOLDINGS, LLC
c/o
Xxxxxx X. Xxxxxxx, Esq.
0000
X Xxxx Xx.
Xxxxxxxx,
XX 00000
|
Copy
to:
Xxxxxx
X. Xxxxxxx, Esq.
0000
X. Xxxx Xxxxxx
Xxxxxxxx,
XX 00000
|
Any Party
may change the address to which notices, requests, demands, claims, and other
communications hereunder are to be delivered by giving the other Parties notice
in the manner herein set forth.
(j) Governing Law and Exclusive
Jurisdiction. This Agreement shall be governed by and construed in accordance
with the domestic laws of the State of South Carolina without giving effect to any choice
or conflict of law provision or rule (whether of the State of South Carolina or any other jurisdiction) that
would cause the application of the laws of any jurisdiction other than the State
of South
Carolina. Exclusive jurisdiction for any action arising from this
Agreement shall be in the Court situated in Richland County, State of South
Carolina. The prevailing party in any litigation arising from this
agreement shall be entitled to recover, in addition to damages and other
remedies, reasonable attorney fees, expert witness fees and costs associated
with the litigation.
Page 24
Exhibit
11.1
(k) Amendments and Waivers. No
amendment of any provision of this Agreement shall be valid unless the same
shall be in writing and signed by Buyer and Parent. No waiver by any Party of
any provision of this Agreement or any default, misrepresentation, or breach of
warranty or covenant hereunder, whether intentional or not, shall be valid
unless the same shall be in writing and signed by the Party making such waiver,
nor shall such waiver be deemed to extend to any prior or subsequent default,
misrepresentation, or breach of warranty or covenant hereunder or affect in any
way any rights arising by virtue of any prior or subsequent such
occurrence.
(l) Severability. Any term or
provision of this Agreement that is invalid or unenforceable in any situation in
any jurisdiction shall not affect the validity or enforceability of the
remaining terms and provisions hereof or the validity or enforceability of the
offending term or provision in any other situation or in any other
jurisdiction.
(m) Expenses. Buyer, Parent and
Target will bear its own costs and expenses (including legal fees and expenses)
incurred in connection with this Agreement and the transactions contemplated
hereby; provided,
however, that Buyer will also bear all of the costs and expenses of
Parent and Target (including all of their legal fees and expenses) incurred in
connection with this Agreement and the transactions contemplated hereby (other
than any Income Tax on any gain resulting from the sale of the Target Interests
hereunder) in the event that the transactions contemplated by this Agreement are
consummated. Without limiting the generality of the foregoing, all transfer,
documentary, sales, use, stamp, registration and other such Taxes, and all
conveyance fees, recording charges and other fees and charges (including any
penalties and interest) incurred in connection with the consummation of the
transactions contemplated by this Agreement shall be paid by Buyer when due, and
Buyer shall, at its own expense, file all necessary Tax Returns and other
documentation with respect to all such Taxes, fees and charges, and, if required
by applicable law, the Parties will, and will cause their Affiliates to, join in
the execution of any such Tax Returns and other documentation.
(n) Construction. The Parties
have participated jointly in the negotiation and drafting of this Agreement. In
the event an ambiguity or question of intent or interpretation arises, this
Agreement shall be construed as if drafted jointly by the Parties and no
presumption or burden of proof shall arise favoring or disfavoring any Party by
virtue of the authorship of any of the provisions of this Agreement. Any
reference to any federal, state, local, or foreign statute or law shall be
deemed also to refer to all rules and regulations promulgated thereunder, unless
the context requires otherwise. The word "including" shall mean including
without limitation.
(o) Incorporation of Exhibits, Annexes,
and Schedules. The Exhibits, Annexes, and Schedules identified in this
Agreement are incorporated herein by reference and made a part
hereof.
(p) Governing Language. This
Agreement has been negotiated and executed by the Parties in English. In the
event any translation of this Agreement is prepared for convenience or any other
purpose, the provisions of the English version shall prevail.
(q) Tax Disclosure
Authorization. Notwithstanding
anything herein to the contrary, the Parties (and each Affiliate and Person
acting on behalf of any Party) agree that each Party (and each employee,
representative, and other agent of such Party) may disclose to any and all
Persons, without limitation of any kind, the transaction's tax treatment and tax
structure (as such terms are used in regulations promulgated under Code Section
6011) contemplated by this agreement and all materials of any kind (including
opinions or other tax analyses) provided to such Party or such Person relating
to such tax treatment and tax structure, except to the extent necessary to
comply with any applicable federal or state securities laws; provided, however, that such disclosure
may not be made until the earlier of date of (A) public announcement of
discussions relating to the transaction, (B) public announcement of the
transaction, or (C) execution of an agreement (with or without conditions) to
enter into the transaction. This authorization is not intended to permit
disclosure of any other information including (without limitation) (A) any
portion of any materials to the extent not related to the transaction's tax
treatment or tax structure, (B) the identities of participants or potential
participants, (C) the existence or status of any negotiations, (D) any pricing
or financial information (except to the extent such pricing or financial
information is related to the transaction's tax treatment or tax structure), or
(E) any other term or detail not relevant to the transaction's tax treatment or
the tax structure.
Page 25
Exhibit
11.1
[Signatures
on next page]
Page 26
Exhibit 11.1
IN WITNESS WHEREOF, the
Parties hereto have executed this Limited Liability Company Interest Purchase
Agreement as of the date first above written.
|
BUYER:
|
|||||
|
SSN
HOLDINGS, LLC
|
|||||
|
By:
|
/s/ Xxxxxx X.
Xxxxxxx
|
||||
|
Xxxxxx X. Xxxxxxx
|
|||||
|
PARENT:
|
|||||
|
By:
|
/s/ Xxxxxxx X.
Xxxxxxxx
|
||||
|
Xxxxxxx X. Xxxxxxxx,
CEO
|
|||||
Page 27
