Exhibit 10.3
ONSITE ACCESS, INC.
SERIES B, SERIES C AND SERIES D PREFERRED STOCK PURCHASE AGREEMENT
This Series B, Series C and Series D Preferred Stock Purchase Agreement is
made as of April 16, 1999 by and between OnSite Ventures, L.L.C., a Delaware
limited liability company (the "Company"), OnSite Access, Inc., a Delaware
corporation (the "Successor"), and the parties listed on Attachment 1 to this
Agreement (each, a "Purchaser" and collectively, the "Purchasers"). AGREEMENT
The parties hereby agree as follows:
Section 1. The Merger; Authorization and Sale of Series B, Series C and
Series D Preferred Stock.
1.1. The Merger. On the first business day after the Company has received
all regulatory approvals from the Federal Communications Commission (the "FCC")
and the New York Public Service Commission (the "NYPSC") necessary to effect
the transactions contemplated by this Agreement, the Company will merge (the
"Merger") with and into the Successor, and the Successor will succeed to all of
the business and assets of the Company in the manner and with the effect
specified in the Delaware General Corporation Law.
1.2. Authorization. The Successor will authorize the sale and issuance of
up to (i) 50,000,000 shares of its Series B Redeemable Preferred Stock (the
"Series B Preferred"), (ii) 25,069,634 shares of its Series C Convertible
Redeemable Preferred Stock (the "Series C Preferred") and (iii) 392,111 shares
of its Series D Convertible Redeemable Preferred Stock (the "Series D
Preferred" and, together with the Series B Preferred and Series C Preferred,
the "Shares"), having the rights, privileges and preferences as set forth in
the Certificate of Designation of Series B, Series C and Series D Preferred
Stock (the "Certificate of Designation") in the form attached to this Agreement
as Exhibit A.
1.3. Sale of Series B Preferred, Series C Preferred and Series D Preferred.
Subject to the terms and conditions of this Agreement, each Purchaser,
severally, agrees to purchase, as set forth on Attachment 1, and the Successor
will sell and issue to each Purchaser (i) the number of shares of the
Successor's Series B Preferred set forth opposite such Purchaser's name on
Attachment 1 at a purchase price of $1.00 per share, (ii) the number of shares
of the Successor's Series C Preferred set forth opposite such Purchaser's name
on Attachment 1 at a purchase price of $0.39 per share and (iii) the number of
shares of the Successor's Series D Preferred set forth opposite such
Purchaser's name on Attachment 1 at a purchase price of $0.39 per share.
Section 2. The Closings.
2.1. The First Closing. The first closing of the purchase and sale of the
Shares under this Agreement (the "First Closing") shall be held at the offices
of Xxxxxx & Xxxxxxx, 000 Xxxxx Xxxxxx, Xxxxx 0000, Xxx Xxxx, Xxx Xxxx 00000 at
10:00 a.m., Eastern Standard Time, on the first business day following
consummation of the Merger, or at such other time and place as the Successor
and the Purchasers may mutually agree upon. The date of the First Closing is
hereinafter referred to as the "First Closing Date." At the First Closing, the
Successor will deliver to the Purchasers certificates representing the number
of Shares set forth under the caption "First Closing" on Attachment 1 to be
purchased by the Purchasers registered in the name of the Purchasers (or their
respective nominees) against payment to the Successor of the full purchase
price for such Shares set forth under the caption "First Closing" on Attachment
1 to be by wire transfer of immediately available funds or by cancellation of
indebtedness or any combination thereof; PROVIDED, HOWEVER, that the ratio of
the aggregate purchase price of the Series B Preferred purchased at the First
Closing to the aggregate purchase price of the Series C Preferred and Series D
Preferred purchased at the First Closing shall be 5 to 1, and for any Purchaser
who is committed to purchase Series D Preferred as set forth on Attachment 1,
the ratio of the purchase price for such Purchaser's Series C Preferred
purchased at such closing to the purchase price for such Purchaser's Series D
Preferred purchased at such closing shall equal the ratio of such Purchaser's
committed number of Series C Preferred to such Purchaser's committed number of
Series D Preferred, each as set forth opposite such Purchaser's name on
Attachment 1.
2.2. Subsequent Closings. From time to time, the Funding Committee of the
Successor may by written notification require the Purchasers to purchase, or
the Purchaser upon the election of the holder of a majority of the aggregate
number of outstanding shares of Series B Preferred, Series C Preferred and
Series D Preferred, shall have the right to purchase, any or all of the Shares
not purchased at the First Closing. Upon receipt of such a demand for funding
or the making of such election, the Purchasers shall purchase the amount of
Shares set forth in such notification or subject to such election; PROVIDED,
HOWEVER, that each Purchaser's obligation to purchase such Shares shall be
several and not joint; AND PROVIDED FURTHER that each Purchaser's obligation
shall be to purchase that number of such Shares that bears the same ratio to
the total number of such Shares as such Purchaser's committed number of Shares
bears to the total number of Shares as set forth on Attachment 1. The closing
of the purchase and sale of such Shares under this Agreement (each, a
"Subsequent Closing" and collectively, the "Subsequent Closings") shall be held
at the offices of Xxxxxx & Xxxxxxx, 000 Xxxxx Xxxxxx, Xxxxx 0000, Xxx Xxxx, Xxx
Xxxx 00000 at 10:00 a.m., Eastern Standard Time, on the fifth business day
following the Purchaser's receipt of notice of the Successor's request or
delivery to Successor of the Purchasers' election, or at such other time and
place as the Successor and the Purchasers may mutually agree upon. The date of
any such Subsequent Closing is hereinafter referred to as a "Subsequent Closing
Date." At any such Subsequent Closing, the Successor will deliver to the
Purchasers certificates representing the amount of Shares purchased by the
Purchasers registered in the name of the Purchasers (or their respective
nominees) against payment to the Successor of the full purchase price for such
amount of Shares by wire transfer of immediately available funds or by
cancellation of indebtedness or any combination thereof; PROVIDED, HOWEVER,
that the ratio of the aggregate purchase price of the Series B Preferred
purchased at any such Subsequent Closing to the aggregate purchase price of the
Series C Preferred and Series D Preferred purchased at such Subsequent Closing
shall be 5 to 1, and for any Purchaser who is committed to purchase Series D
Preferred as set forth on Attachment 1, the ratio of the purchase price for
such Purchaser's Series C Preferred purchased at such closing to the purchase
price for such Purchaser's Series D Preferred purchased at such closing shall
equal the ratio of such Purchaser's committed number of Series C Preferred to
such Purchaser's committed number of Series D Preferred, each as set forth
opposite such Purchaser's name on Attachment 1.
2.3. Conditions to Obligations. If at the First Closing or any Subsequent
Closing any of the conditions specified in Section 5.1 of this Agreement shall
not have been fulfilled, the Purchasers shall, at their election, be relieved
of all of their obligations under this Agreement in connection with the First
Closing or such Subsequent Closing, as applicable, without thereby waiving any
other rights the Purchasers may have by reason of such failure or such
non-fulfillment. If at the First Closing or any Subsequent Closing any of the
conditions specified in Section 6 of this Agreement shall not have been
fulfilled, the Successor shall, at its election, be relieved of all of its
obligations under this Agreement in connection with the First Closing or such
Subsequent Closing, as applicable, without thereby waiving any other rights it
may have by reason of such failure or non-fulfillment.
2.4. Failure to Purchase.
(a) Notwithstanding any other remedy available to the Company or any
other Purchaser or any other provision of this Agreement, the Rights Agreement
or the Voting Agreement, the failure by a Purchaser to pay in full the amount
due from such Purchaser (the "Defaulting Purchaser") at the First Closing or
any Subsequent Closing shall result in the Defaulting Purchaser's loss of (i)
rights to designate and maintain a director under the Voting Agreement and (ii)
with respect to the Series B Preferred, Series C Preferred and Series D
Preferred held by the Defaulting Purchaser, all observation rights under
Section 17 of the Rights Agreement; PROVIDED, HOWEVER, that the loss of the
rights described in the foregoing clause (ii) and the Rights Forfeiture (as
defined in Section 2.4(c) hereof) shall not apply to any Series B Preferred,
Series C Preferred or Series D Preferred which any Purchaser (other than a
Defaulting Purchaser) shall have purchased from a Defaulting Purchaser pursuant
to the provisions of this Section 2.4 (and to the extent that there shall have
been a loss of those rights, including a loss of rights as a result of a Rights
Forfeiture, prior to such purchase, those rights shall be retroactively
reinstated) if one or more Purchasers shall have paid to the Company on behalf
of the Defaulting Purchaser, through the purchase of Shares at or subsequent to
the First Closing or a Subsequent Closing, as the case may be, pursuant to the
procedures set forth in this Agreement, the amount due from the Defaulting
Purchaser. In the event of any such failure by a Defaulting Purchaser to so
fund, (i) all Purchasers who have not failed to fund as required hereunder
shall have the right, which right shall continue for a period of one year from
the occurrence of such failure, to purchase their pro rata share of the Shares
previously purchased pursuant to this Agreement by the Defaulting Purchaser, at
a price equal to 50% of the aggregate price paid by the Defaulting Purchaser
for such Shares, plus any accrued and unpaid dividends thereon, or if such
price is not legally enforceable, the minimum price enforceable under law (and
shall have the right to purchase their pro rata share of any Shares not so
purchased by other Purchasers entitled to purchase such Shares) and (ii) all
Purchasers who have not so failed to fund shall have the right, but not the
obligation, to purchase their pro rata share of such unpurchased Shares (and
shall have the right to purchase their pro rata share of any Shares not so
purchased by other Purchasers entitled to purchase such Shares).
(b) Upon a Defaulting Purchaser's failure to purchase Shares at the
First Closing or any Subsequent Closing, the Successor shall give written
notice of such failure to each of the other Purchasers. Each of the other
Purchasers shall have ten (10) business days from its receipt of such notice to
purchase a portion or all of such unpurchased Shares (the Shares so purchased
by the other Purchasers pursuant to this Section 2.4(b) being referred to
herein as the "Purchased Default Shares"). The penalties set forth in the first
sentence of Section 2.4(a) shall only apply to a Defaulting Purchaser if any of
such Defaulting Purchaser's unpurchased Shares have not been purchased by the
other Purchasers at the end of the tenth (10th) business day after the last
Purchaser receives notice under this Section 2.4(b).
(c) If a Defaulting Purchaser shall fail to purchase Shares at the
First Closing or any Subsequent Closing and the Shares which the Defaulting
Purchaser shall fail to purchase are not purchased by the Defaulting Purchaser
or do not become Purchased Default Shares, in each case, within twenty (20)
days following the date of the First Closing or Subsequent Closing, as the case
may be, then the Successor may, at any time subsequent to the expiration of the
foregoing twenty (20) day period, provide the Defaulting Purchaser with notice
of its intention to elect to impose the Rights Forfeiture (as defined below) if
the Shares are not purchased by the Defaulting Purchaser or the Shares do not
become Purchased Default Shares within sixty (60) days following the date on
which such notice is given to the Defaulting Purchaser. If upon expiration of
the foregoing sixty (60) day period, any such Shares have not been purchased by
the Defaulting Purchaser or become Purchased Default Shares, such Shares shall
automatically, upon expiration of such sixty (60) day period, be subject to the
Rights Forfeiture. For purposes of this Section 2.4, the term "Rights
Forfeiture" shall mean the forfeiture of (i) the Preemptive Right set forth in
Section 13 of the Rights Agreement, (ii) the rights of first offer and co-sale
set forth in Section 14 of the Rights Agreement, and (iii) the right to be an
Initiating Preferred Holder (as defined in the Rights Agreement).
Section 3. Representations and Warranties of the Company.
Except as set forth on the Disclosure Schedule attached hereto as Exhibit
B, the Company and the Successor hereby represent and warrant to each of the
Purchasers as follows:
3.1. Organization and Standing; Certificate and Bylaws; Subsidiaries.
(a) The Company is a limited liability company duly organized and
validly existing under, and by virtue of, the laws of the State of New York and
is in good standing under such laws. As of the date of this Agreement, the
Company has three subsidiaries: OnSite Access LLC, a New York limited liability
company, OnSite Access Local LLC, a New York limited liability company, and
Glass Circuits LLC, a New York limited liability company (each, a "Subsidiary"
and together, the "Subsidiaries") and the Company does not own, directly or
indirectly, any capital stock or equity securities of any corporation or have
any direct or indirect equity or ownership interest in any business,
corporation, partnership, limited liability company, joint venture or entity
other than the Subsidiaries. The Subsidiaries were duly formed in compliance
with and are validly existing and in good standing under the laws of the State
of New York and none of the securities or ownership interests issued, offered
or sold by any of the Subsidiaries was issued, offered or sold in violation of
any applicable federal or state laws, including, without limitation, all
federal securities and state securities or blue sky laws or the rules or
regulations promulgated thereunder and all federal, state and local licensing
regulations. The Company owns 100% of the ownership interests in the
Subsidiaries free and clear of any liens, security interests or other
encumbrances other than any liens, security interest or encumbrance relating to
or granted in connection with the Bridge Financing or the Interim Financing
(each as defined below) or any restrictions on transfer imposed by law. There
are no agreements, contracts or obligations (whether written or oral), options,
rights or other commitments of any character relating to the issuance of any
membership interests or other securities by any of the Subsidiaries. The
Company and the Subsidiaries have the requisite corporate power to own and
operate their properties and assets, and to carry on their businesses as
presently conducted, except where the failure to have such power would not have
a material adverse effect (financial or otherwise) on the business, property,
prospects, assets or liabilities of the Company, the Successor and the
Subsidiaries taken as a whole (such an effect, a "Material Adverse Effect").
The Company and the Subsidiaries are qualified or licensed as a foreign limited
liability company in all jurisdictions where the nature of their businesses or
property makes such qualification or licensing necessary except where the
failure to do so would not have a Material Adverse Effect. The Company has made
available to the Purchasers copies of its operating agreement and other
governing documents, copies of the operating agreements and other governing
documents of the Subsidiaries, copies of the Certificate of Incorporation and
Bylaws of the Successor and the documents to be used to effect and govern the
Merger. Said copies are true, correct and complete and contain all amendments,
modifications and restatements. The current officers and directors (or
equivalent) of the Company and each of the Subsidiaries are as set forth in
Section 3.1(a) of the Disclosure Schedule. (b) ______ The Successor is on the
First Closing Date, and immediately following the consummation of the Merger
will be, a corporation duly organized and validly existing under, and by virtue
of, the laws of the State of Delaware and will be in good standing under such
laws. Upon consummation of the Merger, all right, title and interest in and to
all of the business and assets of the Company, including all interests of the
Company in the Subsidiaries will be transferred to the Successor. Upon
consummation of the Merger, the Merger will have been consummated in accordance
with all applicable law, including, without limitation, all federal securities
and state securities or blue sky laws, federal, state and local licensing
regulations and the governing documents of the Company. Upon consummation of
the Merger, (i) the Successor will own 100% of the ownership interests in the
Subsidiaries free and clear of all liens, security interests or other
encumbrances other than any liens, security interest or encumbrance relating to
or granted in connection with the Bridge Financing or the Interim Financing
(each as defined below), or any restrictions on transfer imposed by law and
will not own, directly or indirectly, any capital stock or equity securities of
any corporation or have any direct or indirect equity or ownership interest in
any business, corporation, partnership, limited liability company, joint
venture or entity other than the Subsidiaries, (ii) there will be no
agreements, contracts or obligations (whether written or oral), options, rights
or other commitments of any character relating to the issuance of any
membership interests or other securities by any of the Subsidiaries, (iii) the
Successor will have the requisite corporate power to own and operate its
properties and assets, and to carry on its business as then conducted and as
proposed to be conducted, except where the failure to have such power would not
have a Material Adverse Effect, (iv) the Successor will be qualified or
licensed as a foreign corporation in all jurisdictions where the nature of its
business or property makes such qualification or licensing necessary, except
where the failure to do so would not have a Material Adverse Effect, (v) the
directors of the Successor will be as set forth in Exhibit I attached hereto
and the officers and managers of each of the Subsidiaries will be as set forth
in Section 3.1(a) of the Disclosure Schedule, except to the extent changes have
been approved by the Purchasers, and (vi) all persons who will have observation
rights at meetings of the board of directors of the Successor will be those
persons specified in Section 3.1(b) of the Disclosure Schedule.
3.2. Corporate Power.
(a) The Company has all requisite legal power to execute and deliver
this Agreement and to carry out and perform its obligations under the terms of
this Agreement.
(b) Following the consummation of the Merger, the Successor will have
all requisite legal and corporate power to sell and issue the Shares hereunder,
to issue the Common Stock issuable upon conversion of the Series C Preferred
and Series D Preferred and to carry out and perform its obligations under the
terms of the Related Documents (as herein defined).
3.3. Capitalization. The authorized capital stock of the Successor will
consist, immediately prior to the First Closing, of (i) 75,000,000 shares of
Common Stock, of which 4,131,000 shares will be issued and outstanding, and
(ii) 81,330,745 shares of Preferred Stock, 5,869,000 of which will be
designated Series A Preferred Stock, of which 5,869,000 shares will be
outstanding, 50,000,000 of which will be designated Series B Preferred, none of
which will be outstanding, 25,069,634 of which will be designated Series C
Preferred, none of which will be outstanding and 392,111 of which will be
designated Series D Preferred, none of which will be outstanding. Immediately
prior to the First Closing, all issued and outstanding shares will have been
duly authorized and validly issued, and with respect to the Series B Preferred,
Series C Preferred and Series D Preferred, upon payment in accordance with this
Agreement, will be fully paid and nonassessable. Upon consummation of the
Merger, the Successor will have reserved (i) 5,869,000 shares of Common Stock
for issuance upon conversion of the Series A Preferred Stock (ii) 25,069,634
shares of Common Stock for issuance upon conversion of the Series C Preferred
and (iii) 392,111 shares of Common Stock for issuance upon conversion of the
Series D Preferred. Upon consummation of the merger, the Series A Preferred,
Series B Preferred, Series C Preferred and Series D Preferred will have the
rights, preferences, privileges and restrictions set forth in the Certificate
of Designation. All outstanding securities of the Company were issued in
compliance with applicable federal and state securities laws. Upon consummation
of the Merger, (i) the Successor will have reserved 9,096,309 shares of Common
Stock for issuance under the 1999 Stock Option Plan which will have been
approved and adopted by the board of directors of the Successor, and (ii)
options to purchase an aggregate of 2,596,309 shares of Common Stock will be
outstanding under the 1999 Stock Option Plan, none of which will have been
exercised. Except for options outstanding under the 1999 Stock Option Plan as
described above, the Series A Preferred, the Series C Preferred, the Series D
Preferred and any preemptive rights provided in the Related Documents, there
will not be any preemptive rights, options or warrants or other conversion or
exchange privileges or rights outstanding on the First Closing Date to purchase
any securities of the Successor. Upon consummation of the Merger, the Successor
will not be obligated to repurchase any shares of its capital stock or any
other securities pursuant to any contract, commitment or arrangement
(contingent or otherwise) other than as provided in the Certificate of
Designation. On the First Closing Date, the Successor will not be a party to,
or subject to, any agreement or understanding which affects or relates to the
voting or giving of written consents with respect to any security of the
Successor other than the Voting Agreement (as defined herein).
3.4. Authorization.
(a) All action on the part of the Company, its officers, directors and
members necessary for the authorization, execution, delivery and, to the extent
applicable, performance of this Agreement, the Certificate of Designation, the
Investor Rights Agreement in the form attached hereto as Exhibit C (the "Rights
Agreement"), the Voting Agreement in the form attached hereto as Exhibit D (the
"Voting Agreement"), and any other agreements, certificates, instruments or
documents to be executed and delivered in connection herewith or therewith or
pursuant hereto or thereto (collectively, with the Certificate of Designation,
the Rights Agreement and the Voting Agreement, the "Related Documents") by the
Company has been taken. Prior to the First Closing, all corporate action on the
part of the Successor and its officers, directors and stockholders necessary
for the authorization, sale, issuance and delivery of the Shares (and the
Common Stock issuable upon conversion of the Series C Preferred and the Series
D Preferred) and the performance of all of the Successor's obligations under
this Agreement and the Related Documents will have been taken. This Agreement,
when executed and delivered by the Company and the Successor, shall constitute
the valid and binding obligation of the Company and the Successor, enforceable
against the Company and the Successor in accordance with its terms, except to
the extent that enforceability may be limited by (i) applicable bankruptcy,
insolvency, moratorium, fraudulent conveyance and other similar laws affecting
creditors' rights and remedies generally, and (ii) general principles of
equity. The Related Documents, when executed and delivered by the Company and
the Successor, as the case may be, shall constitute valid and binding
obligations of the Company and the Successor, as applicable, enforceable
against the Company and the Successor, as the case may be, in accordance with
their terms except to the extent that enforceability may be limited by (i)
applicable bankruptcy, insolvency, moratorium, fraudulent conveyance and other
similar laws affecting creditors' rights and remedies generally, and (ii)
general principles of equity. The Shares, when issued in compliance with the
provisions of the Certificate of Designation, will be validly issued and will
be fully paid and nonassessable and will have the rights, preferences and
privileges described in the Certificate of Designation.
(b) Upon the issuance of the Series C Preferred and Series D
Preferred, the shares of Common Stock issuable upon conversion of the Series C
Preferred and the Series D Preferred will be duly and validly reserved and,
when issued in compliance with the provisions of the Certificate of
Designation, will be validly issued, fully paid and nonassessable, and the
Shares and such Common Stock will be free of all liens or encumbrances other
than those created by or imposed upon the holders thereof through no action of
the Company or the Successor; PROVIDED, HOWEVER, that the Shares (and the
Common Stock issuable upon conversion of the Series C Preferred and the Series
D Preferred) may be subject to restrictions on transfer under state or federal
securities laws as set forth herein or other federal or state regulatory laws
and restrictions under the Related Documents. The Shares will not be subject to
any preemptive rights and will not be subject to any rights of first refusal
other than as provided in the Related Documents. Following consummation of the
Merger, no further corporate action on the part of the Successor, its directors
or its stockholders will be necessary in connection with the issuance and
delivery of the shares of Common Stock by the Successor issuable upon
conversion of the Series C Preferred and the Series D Preferred. Section 3.4 of
the Disclosure Schedule contains a true and accurate list of holders of record
of all shares of capital stock of the Successor that will be outstanding
immediately following consummation of the Merger and any other securities that
will be outstanding immediately following consummation of the Merger which are
convertible or exchangeable into any capital stock of the Successor, including,
without limitation, any warrants or options to purchase Common Stock or any
such securities, together with the number of shares or other securities held by
each.
3.5. Financial Statements. The Company has made available to the Purchasers
draft forms of the consolidated financial statements (including balance sheet,
income statement and statement of cash flows) of the Company as of December 31,
1998 and for the fiscal year ended December 31, 1998 and the Company's
unaudited consolidated financial statements (including balance sheet, income
statement and statement of cash flows) as of February 28, 1999 and for the
two-month period ended February 28, 1999 (collectively, the "Financial
Statements"). The Financial Statements have been prepared in accordance with
generally accepted accounting principles applied on a consistent basis
throughout the periods indicated and fairly present the financial condition and
operating results of the Company as of the dates, and for the periods,
indicated therein, except that the unaudited Financial Statements for the
two-month period ended February 28, 1999 may not contain all footnotes required
by generally accepted accounting principles. Except as set forth in any of the
Financial Statements or the notes thereto, the Company has no liabilities,
contingent or otherwise, other than (i) the Bridge Financing or the Interim
Financing, (ii) liabilities incurred in the ordinary course of business
subsequent to February 28, 1999 and (iii) obligations under contracts and
commitments incurred in the ordinary course of business and not required under
generally accepted accounting principles to be reflected in the Financial
Statements, which, in both cases, individually or in the aggregate are not
material to the financial condition or operating results of the Company. The
Company maintains a system of internal accounting controls that will enable it
to prepare financial statements in accordance with generally accepted
accounting principles.
3.6. Changes. Except for the consummation of the bridge financing provided
to the Predecessor by RSI-OSA Holdings, Inc. and JAH Realties, L.P., on
February 10, 1999 (the "Bridge Financing") and the Interim Financing, since
February 28, 1999, there has not been:
(a) any change in the business, assets, properties, liabilities,
condition (financial or otherwise) or operating results of the Company or any
of the Subsidiaries from that reflected in the Financial Statements, except
changes in the ordinary course of business that have not been, in the
aggregate, materially adverse;
(b) any damage, destruction or loss, whether or not covered by
insurance, materially and adversely affecting the business, assets, properties,
liabilities, prospects, condition (financial or otherwise) or operating results
of the Company or any of the Subsidiaries;
(c) any waiver (or partial waiver) or compromise by the Company or any
of the Subsidiaries of a material right or of a material debt owed to it, other
than waivers granted in the ordinary course of business which, individually and
in the aggregate, would not have a Material Adverse Effect;
(d) any satisfaction or discharge of any lien, claim or encumbrance or
payment of any obligation by the Company or any of the Subsidiaries, except in
the ordinary course of business and that is not material to the business,
properties, prospects or financial condition of the Company and the
Subsidiaries taken as a whole;
(e) any change to a material contract, agreement or arrangement of the
Company or any of the Subsidiaries by which the Company or any of the
Subsidiaries or any of their assets is bound or subject;
(f) any material change in any compensation arrangement or agreement
with any employee, officer, director, stockholder, member or consultant;
(g) any sale, assignment or transfer of any patents, trademarks,
copyrights, trade secrets or other intangible assets of the Company or any of
the Subsidiaries;
(h) any sale, assignment or transfer of any tangible assets of the
Company or any of the Subsidiaries except for the sale of inventory in the
ordinary course of business in amounts consistent with past practices;
(i) any resignation or termination of employment of any officer or key
employee of the Company or any of the Subsidiaries; and the Company is not
aware of any impending resignation or termination of employment of any such
officer or key employee;
(j) any mortgage, pledge, transfer of a security interest in or lien,
created by the Company or any of the Subsidiaries with respect to any of their
properties or assets, except liens for taxes not yet due or payable;
(k) any declaration, setting aside or payment or other distribution
with respect to any of the membership interests in the Company or any of the
Subsidiaries or any direct or indirect redemption, purchase or other
acquisition of any of such membership interests by the Company or any of the
Subsidiaries;
(l) any receipt by the Company or any of the Subsidiaries of notice
that there has been a cancellation of an order for their services or a loss of
a customer (or any building owner under contract) or any supplier or service
provider of the Company or any of the Subsidiaries, the cancellation or loss of
which would have a Material Adverse Effect;
(m) any labor trouble at the Company or any of the Subsidiaries which
could have a Material Adverse Effect;
(n) any change in the line of business of the Company or any of the
Subsidiaries;
(o) any payment, loan or advance of any amount by the Company or any
of the Subsidiaries to, or any sale, transfer or lease of any properties or
assets by the Company or any of the Subsidiaries, or any other agreement or
arrangement entered into by the Company or any of the Subsidiaries with, any of
its officers, directors, stockholders, members or other affiliates or any
consultants, except (i) for normal business advances to employees consistent
with past practice, (ii) pursuant to written agreements existing as of February
28, 1999 (all of which are listed in Section 3.6(o) of the Disclosure
Schedule), and (iii) for payment of compensation to officers.
(p) to the knowledge of the Company, any other event or condition of
any character which has or could be reasonably expected to have a Material
Adverse Effect; or
(q) any binding arrangement or commitment by the Company to do any of
the things described in subsections (a) through (p) of this Section 3.6.
3.7. Patents and Other Intangible Assets.
(a) The Company and the Subsidiaries have, and immediately following
the consummation of the Merger the Successor will have, sufficient title and
ownership of all patents, trademarks, service marks, trade names, copyrights,
trade secrets, information, proprietary rights and processes necessary for
their businesses as now conducted by the Company. There are no outstanding
options, licenses, or agreements of any kind relating to the foregoing, nor is
the Company, the Successor or any of the Subsidiaries bound by or a party to
any options, licenses or agreements of any kind with respect to the patents,
trademarks, service marks, trade names, copyrights, trade secrets, licenses,
information, proprietary rights and processes of any other person or entity.
(b) Neither the Company nor the Successor nor any of the Subsidiaries
has received any written communications alleging that the Company, the
Successor or any of the Subsidiaries have violated or, by conducting their
businesses as proposed, would violate any of the patents, trademarks, service
marks, trade names, copyrights or trade secrets or other proprietary rights of
any other person or entity. Neither the Company nor the Successor nor any of
the Subsidiaries is aware that any of their employees is obligated under any
contract (including licenses, covenants or commitments of any nature) or other
agreement, or subject to any judgment, decree or order of any court or
administrative agency, that would interfere with the use of his or her best
efforts to promote the interests of the Company or the Successor or the
Subsidiaries or that would conflict with the Company's or the Successor's or
the Subsidiaries' businesses as proposed to be conducted. Neither the execution
nor the delivery of this Agreement, the Rights Agreement or the Voting
Agreement, nor the carrying on of the Company's or the Successor's or the
Subsidiaries' businesses by the employees of the Company or the Successor or
the Subsidiaries, nor the conduct of the Company's or the Successor's or the
Subsidiaries' businesses as proposed, will, to the knowledge of the Company or
the Successor, conflict with or result in a breach of the terms, conditions or
provisions of, or constitute a default under, any contract, covenant or
instrument under which, to the knowledge of the Company or the Successor, any
of such employees is now obligated. Neither the Company nor the Successor
believes it is or will be necessary to utilize any inventions of any of the
Company's or the Successor's or the Subsidiaries' employees (or people they
currently intend to hire) made prior to their employment by the Company or the
Successor or the Subsidiaries.
3.8. Compliance with Other Instruments, None Burdensome, Etc. Neither the
Company nor the Successor nor any of the Subsidiaries is in violation, breach
or default (with or without the passage of time and giving of notice or both)
of (i) any term of its operating agreement, certificate of incorporation or
bylaws or other organizational document, each as amended and in effect on and
as of the First Closing Date or (ii) of any term or provision of any material
mortgage, indebtedness, indenture, contract, agreement or instrument to which
the Company, the Successor or any of the Subsidiaries or their properties are
bound which violation, breach or default could have a Material Adverse Effect.
The Company, the Successor and the Subsidiaries are in compliance with all
judgments, decrees, governmental orders, laws, statutes, rules and regulations
by which they are bound or to which they or any of their properties or assets
is subject, except where the failure to be in such compliance would not have a
Material Adverse Effect. The execution, delivery and performance of and
compliance with this Agreement and the Related Documents, and the issuance of
the Shares and the Common Stock issuable upon conversion of the Series C
Preferred and the Series D Preferred, have not resulted and will not result in
any violation of, or conflict with, or constitute a breach or default (with or
without the passage of time and giving of notice or both) under, (a) the
operating agreement of the Company or any of the Subsidiaries or the
certificate of incorporation or bylaws of the Successor or (b) any mortgage,
indebtedness, indenture, contract, agreement, instrument, judgment, decree,
order, statute, rule, law or regulation applicable to the Company or any of the
Subsidiaries, which violation, conflict, breach or default could have a
Material Adverse Effect, or result in the creation of any mortgage, pledge,
lien, encumbrance or charge upon any of the material properties or assets of
the Company or any of the Subsidiaries.
3.9. Litigation, Etc. There are no actions, suits, proceedings or
investigations pending against the Company, the Successor or any of the
Subsidiaries or their properties before any court or governmental agency. There
are no actions, suits, proceedings or investigations overtly threatened against
the Company, or to the knowledge of the Company, overtly threatened or pending
against the officers, managing members or directors of the Company, the
Successor or any of the Subsidiaries before any court or governmental agency,
which would have a Material Adverse Effect. There are no actions, suits,
proceedings or investigations pending or overtly threatened against the
Company, the Successors or any of the Subsidiaries or their properties (nor, to
the knowledge of the Company, against officers, managing members or directors
of the Company or any of the Subsidiaries) which question the validity of this
Agreement, the Rights Agreement, the Voting Agreement or any other Related
Document or any action taken or to be taken in connection herewith or
therewith. The foregoing includes, without limitation, actions, suits,
proceedings or investigations pending or threatened (or any basis therefor
known to the Company), involving the prior employment of any of the Company's,
the Successor's or the Subsidiaries' employees, their use in connection with
the Company's, the Successor's or the Subsidiaries' businesses of any
information or techniques allegedly proprietary to any of their former
employers, or their obligations under any agreements with prior employers.
Neither the Company, the Successor nor any of the Subsidiaries is a party or
subject to the provisions of any order, writ, injunction, judgment or decree of
any court or government agency or instrumentality. There is no action, suit,
proceeding or investigation commenced by the Company, the Successor or any of
the Subsidiaries currently pending or that the Company, the Successor or any of
the Subsidiaries intend to initiate.
3.10. Employees. No employee or consultant of the Company, the Successor or
any of the Subsidiaries is in violation of any term of any employment,
employment contract, patent disclosure agreement or any other contract or
agreement relating to the relationship of any such person with the Company, the
Successor or any of the Subsidiaries or, to the knowledge of the Company or the
Successor, with any other party because of the nature of the business conducted
or to be conducted by the Company, the Successor or the Subsidiaries. There are
no Employee Plans or Compensation Arrangements (each as defined below) which
are not listed in Section 3.10 of the Disclosure Schedule. To the knowledge of
the Company and the Successor, each Employee Plan (as defined below) and
Compensation Arrangement (as defined below) has been administered in compliance
with its own terms and in material compliance with the provisions of ERISA, the
Code (each as defined below) and any other applicable federal, state or other
laws. Neither the Company, the Successor, any of the Subsidiaries nor any ERISA
Affiliate (as defined below) is contributing to, is required to contribute to,
or has contributed within the last six (6) years to or otherwise has any
liability with respect to, any: (i) Employee Plan subject to Title IV of ERISA;
(ii) Employee Plan or Compensation Arrangement that provides medical or death
benefit coverage to former employees of the Company or the Successor or any of
the Subsidiaries, except to the extent required by Section 4980B of the Code;
or (iii) multiple employer welfare arrangement as defined in ERISA Section
3(40). Neither the Company, the Successor nor any of the Subsidiaries has
entered into any agreement with any employee, member or director which provides
for any payment or acceleration of benefits upon the occurrence of (i) any sale
of membership or other ownership interests, stock or assets of the Company, the
Successor or any of the Subsidiaries; (ii) any change of control of the
Company, the Successor or any of the Subsidiaries; or (iii) any registration of
the Company's or the Successor's securities under the Securities Act. Neither
the execution and delivery of this Agreement and the Related Documents nor the
consummation of the transactions contemplated hereby or thereby will (i) result
in any payment (including, without limitation, severance or unemployment
compensation) becoming due to any director, member or employee of the Company,
the Successor or any of the Subsidiaries; (ii) result in the acceleration of
vesting under any Employee Plan or Compensation Arrangement; or (iii) increase
any benefits otherwise payable under any Employee Plan. For purposes of this
Agreement, the following terms shall have the meaning indicated: (i) "Employee
Plan" shall mean any retirement or welfare plan or arrangement, or any other
employee benefit plan as defined in Section 3(3) of ERISA to which the Company,
the Successor, any of the Subsidiaries or any ERISA Affiliate contributes or
contributed or to which the Company, the Successor, any of the Subsidiaries or
any ERISA Affiliate sponsors or sponsored, maintains or maintained or otherwise
is or was bound; (ii) "Code" shall mean the Internal Revenue Code of 1986, as
amended, any successor thereto and any regulations promulgated thereunder;
(iii) "Compensation Arrangement" shall mean any plan or compensation
arrangement other than an Employee Plan, whether written or unwritten, which
provides to present or former employees, officers, directors, members and
stockholders of the Company, the Successor, any of the Subsidiaries or any
ERISA Affiliate any compensation or other benefits, whether deferred or not,
including, but not limited to, any bonus or incentive plan, stock rights plan,
deferred compensation arrangement, life insurance, stock purchase plan,
severance pay plan and any other employee fringe benefit plan; (iv) "ERISA"
shall mean the Employee Retirement Income Security Act of 1974, as amended, any
successor thereto and any regulations promulgated thereunder; and (v) "ERISA
Affiliate" shall mean any trade or business related to the Company, the
Successor or the Subsidiaries under the terms of Sections 414(b), (c), (m) or
(o) of the Code.
3.11. Consent, Etc. No consent, approval, license or authorization of or
designation, declaration, registration or filing with any court or governmental
authority or any party to any Contract (as defined in Section 8.14(a) hereof)
or any other third party is or was required to be obtained by the Company, the
Successor or any of the Subsidiaries in connection with (i) the valid execution
and delivery of this Agreement and the Related Documents, (ii) the Merger,
(iii) the offer, sale or issuance of the Shares (and the Common Stock issuable
upon conversion of the Series C Preferred and the Series D Preferred) or (iv)
the consummation of any other transaction contemplated by this Agreement, the
Rights Agreement or the Voting Agreement, except for filing of the Certificate
of Designation in the office of the Secretary of State of the State of
Delaware, and the compliance with applicable blue sky laws, each of which will
have been, as of the First Closing, duly and timely obtained.
3.12. Offering. Subject to the accuracy of the Purchasers' representations
in Section 4 of this Agreement, the offer, sale and issuance of the Shares to
be issued in conformity with the terms of this Agreement and the issuance of
the Common Stock to be issued upon conversion of the Series C Preferred and the
Series D Preferred, constitute transactions exempt from the registration
requirements of Section 5 of the Securities Act of 1933, as amended (the
"Securities Act"). Neither the Company, the Successor nor anyone acting on
behalf of the Company or the Successor has sold Shares or similar securities or
will sell, offer to sell or solicited offers to buy the Shares or similar
securities to, or solicit offers with respect thereto from, any Person so as to
bring the issuance and sales of the Shares and the shares of Common Stock
issuable upon conversion of the Series C Preferred and the Series D Preferred
under the registration provisions of the Securities Act or applicable state
securities laws.
3.13. Brokers or Finders. Neither the Company, the Successor nor any of the
Subsidiaries has incurred, and neither the Company, the Successor nor any of
the Subsidiaries will incur, directly or indirectly, as a result of any action
taken by the Company, the Successor or any of the Subsidiaries, any liability
for brokerage or finders' fees or agents' commissions or any similar charges in
connection with this Agreement.
3.14. Disclosure. Except with respect to the Projections (as defined in
Section 3.24 hereof), no information provided by the Company to any Purchaser
in connection with such Purchaser's due diligence review of the Company or the
Successor or the transactions contemplated by this Agreement or the Related
Documents contains any untrue statement of a material fact or knowingly omits
to state a material fact necessary in order to make the statements contained
therein, in light of the circumstances under which they were made, not
misleading.
3.15. No Conflict of Interest. Neither the Company, the Successor nor any
of the Subsidiaries is indebted, directly or indirectly, to any of their
officers, directors, members or holders of 5% or more of the equity or voting
power of the Company, the Successor or any of the Subsidiaries or to their
respective spouses, parents, children or siblings or their respective
affiliates, in any material amount whatsoever, except for reimbursement for
ordinary business travel and other expenses reasonably incurred in the ordinary
course of business, indebtedness resulting from the Bridge Financing and the
financing provided to the Company by RSI-OSA Holdings, Inc. on February 20,
1998 (the "1998 Reckson Financing"). None of said officers, directors, members
or holders, or any members of their immediate families or, to the knowledge of
the Company or the Successor, any of their affiliates, are indebted, directly
or indirectly, to the Company, the Successor or any of the Subsidiaries or, to
the knowledge of the Company or the Successor, has any direct or indirect
ownership interest (other than the ownership of less than 2.5% of the
outstanding shares of common stock of a publicly traded company) in any firm or
corporation with which the Company or the Successor or any of the Subsidiaries
is affiliated or with which the Company or the Successor or any of the
Subsidiaries has a business relationship, or any firm or corporation which
competes with the Company or the Successor or the Subsidiaries except that
officers, directors, members or stockholders of the Company or the Successor or
the Subsidiaries may own stock in publicly traded companies which may compete
with the Company or the Successor or the Subsidiaries. To the knowledge of the
Company and the Successor, no officer, director, member or holder of 5% or more
of the equity or voting power of the Company or the Successor or any of the
Subsidiaries or any member of their immediate families or any of their
respective affiliates, is, directly or indirectly, interested in any agreements
or contracts with the Company, the Successor or any of the Subsidiaries, except
(i) to the extent any of the foregoing is a party to the Related Documents,
(ii) for agreements with respect to the purchase of the Successor's common
stock by such persons pursuant to options outstanding under the Successor's
1999 Stock Option Plan, (iii) for agreements relating to the 1998 Reckson
Financing, the Bridge Financing or the Intercompany Agreement dated as of
February 20, 1998 between OnSite Ventures, L.L.C. and OnSite Commerce and
Content LLC (the "Intercompany Agreement"), and (iv) for contracts between the
Company and Reckson Associates and its subsidiaries relating to the wiring of
buildings owned by Reckson Associates and its subsidiaries, all of which are
listed in Section 3.15 of the Disclosure Schedule. Neither the Company, the
Successor nor any of the Subsidiaries is a guarantor or indemnitor of any
indebtedness of any other person, firm or corporation.
3.16. Agreements.
(a) Except as relates to the Bridge Financing, the Interim Financing
and the 1998 Reckson Financing, neither the Company, the Successor nor any
Subsidiary is a party to or bound by:
(i) any note, bond, debenture or other evidence of indebtedness,
or any contract, agreement, instrument, judgment, order, writ, decree,
commitment or understanding under which it has borrowed any money or issued any
note, bond, debenture or other evidence of indebtedness, or any mortgage,
pledge, security agreement, deed of trust, financing statement or other
document granting any lien, encumbrance or security interest (including liens,
encumbrances or security interests upon properties acquired under conditional
sales, capital leases and other title retention or security devices), or any
guaranty or endorsement (other than endorsements for collection in the ordinary
course of business) of, or other contingent obligations in respect of,
indebtedness for borrowed money or other liabilities or obligations of others,
in any case in excess of $10,000 in principal amount;
(ii) any Contract, instrument, judgment, order, writ, decree,
commitment, arrangement or understanding relating to any joint venture,
partnership or sharing of profits or losses with any person or permitting any
person to utilize any technology, know-how or proprietary information of the
Company, the Successor or any Subsidiary;
(iii) any Contract, instrument, judgment, order, writ, decree,
commitment for the future purchase by the Company, the Successor or any
Subsidiary of any materials, equipment, services, or supplies, which (w)
involves the payment of more than $50,000, (x) continues for a period of more
than six months, (y) by its terms requires the Company, the Successor or any
Subsidiary to purchase the entire output or services of a supplier or (z)
provides that any supplier will be the exclusive supplier of the Company, the
Successor or any Subsidiary;
(iv) any Contract, instrument, proposed transaction, judgment,
order, writ or decree for the sale or other disposition by the Company, the
Successor or any Subsidiary of its assets or properties other than in the
ordinary course of business, or for the merger or consolidation of the Company,
the Successor or any Subsidiary with any other person or entity other than the
Merger;
(v) any Contract, instrument, judgment, order, writ or decree
containing covenants purporting to limit the freedom of the Company, the
Successor or any Subsidiary to compete in any line of business or in any
geographic area;
(vi) any Contract, instrument, judgment, order, writ or decree not
elsewhere specifically disclosed pursuant to this Agreement involving the
payment or receipt by the Company, the Successor or any Subsidiary of more than
$50,000 per year or $150,000 over the term thereof;
(vii) any Contract with a building owner which provides for
payment during the term of the Contract of more than $25,000 or, when combined
with any other such Contracts and the Contracts referred to in clauses (viii)
and (ix) of this Section 3.16, of more than $100,000 in the aggregate;
(viii) any Contract with a consultant which provides for payment
during the term of the Contract of more than $25,000 or, when combined with any
other such Contracts and the Contracts referred to in clauses (vii) and (ix) of
this Section 3.16, of more than $100,000 in the aggregate; or
(ix) any Contract with an incumbent local exchange carrier which
provides for payment during the term of the Contract of more than $25,000 or,
when combined with any other such Contracts and the Contracts referred to in
clauses (vii) and (viii) of this Section 3.16, of more than $100,000 in the
aggregate.
(b) Copies of all Contracts identified in Section 3.16 of the
Disclosure Schedule have been made available to counsel for the Purchasers.
Each of such Contracts, (collectively, the "Scheduled Contracts") constitutes a
valid and binding obligation of the Company, the Successor or a Subsidiary and
is in full force and effect and the consummation of the transactions
contemplated by the Merger or this Agreement will not (i) result in any breach,
default, impairment or forfeiture of any rights thereunder or (ii) require the
approval, consent, or act of, or the making of any declaration, filing or
registration with, any other party. The Company, the Successor or its
Subsidiary, as the case may be, has fulfilled and performed in all material
respects its obligations under each of the Scheduled Contracts required to be
performed prior to the date hereof and will so fulfill and perform such
obligations required to be performed on or prior to the First Closing Date and
neither the Company, the Successor nor any Subsidiary has received any written
notification of any breach, or default under any of the Scheduled Contracts
and, to the knowledge of the Company and the Successor, no other party to any
of the Scheduled Contracts has materially breached or defaulted thereunder,
and, to the knowledge of the Company and the Successor, no event has occurred
and no condition or state of facts exists which, with the passage of time or
the giving of notice or both, would constitute such a default or breach by any
such other party. Neither the Company, the Successor nor any Subsidiary is
currently paying liquidated damages in lieu of performance thereunder.
(c) The conduct of the business of the Company, the Successor and the
Subsidiaries as now conducted or as proposed to be conducted does not and will
not violate or breach any provision of any Contract which violation or breach
could result in a Material Adverse Effect.
(d) For the purposes of subsections (a)(i), (a)(iii) and (a)(vii)
through (ix) of this Section 3.16, all indebtedness, liabilities, agreements,
instruments and contracts involving the same person or entity (including
persons or entities the Company knows are affiliated therewith) shall be
aggregated for the purpose of meeting the individual dollar amounts of such
subsections.
3.17. Permits. The Company and the Subsidiaries have, and the Successor
upon consummation of the Merger will have, all franchises, permits, licenses,
and similar authority necessary for the conduct of their businesses as now
being conducted by them (and in the case of the Successor, to be conducted by
it following the Merger), the lack of which could result in a Material Adverse
Effect. Neither the Company, the Successor nor any of the Subsidiaries is in
default under nor, following the Merger, will the Successor be in default
under, any of such franchises, permits, licenses, or other similar authority
which could result in a Material Adverse Effect. The execution, delivery and
performance of and compliance with this Agreement and the Related Documents,
the consummation of the Merger and the issuance of the Shares and the Common
Stock issuable upon conversion of the Series C Preferred and the Series D
Preferred, have not resulted in and will not result in suspension, revocation,
impairment, forfeiture or nonrenewal of any such franchise, permit, license or
similar authority which could result in a Material Adverse Effect.
3.18. Registration Rights, Preemptive Rights and Voting Rights. Except as
provided in the Rights Agreement, neither the Company nor the Successor has
granted or agreed to grant any registration rights, including piggyback
registration rights or preemptive rights, to any person or entity.
3.19. Title to Property and Assets. Except for liens securing obligations
incurred in connection with the Bridge Financing or the Interim Financing, the
Company, the Successor and the Subsidiaries own their properties and assets
free and clear of all mortgages, liens and encumbrances, except such
encumbrances and liens created with the consent of the Company or, that arise
in the ordinary course of business and do not materially impair the Company's,
the Successor's or the Subsidiaries' ownership or use of such properties or
assets. With respect to the properties and assets they lease, the Company, the
Successor and the Subsidiaries are in material compliance with such leases and,
to the knowledge of the Company and the Successor, the other party to any such
lease has not given notice of any material default thereunder. The Real
Property (as defined in Section 8.14(e) hereof) includes sufficient access to
the facilities necessary to conduct the operations of the Company, the
Successor and the Subsidiaries in the manner in which they are currently
conducted. There is no pending or, to the best knowledge of the Company or the
Successor, threatened condemnation or similar proceeding affecting any Real
Property. The use of the Real Property owned by the Company as currently used
is in compliance with applicable zoning and land use laws in all material
respects.
3.20. Insurance.
(a) On the First Closing Date, the Company and the Subsidiaries will
have obtained casualty and liability insurance policies issued by insurers of
recognized responsibility, with extended coverage in such amounts as are (i)
carried by companies in positions similar to the Company and the Subsidiaries
with respect to liability insurance and (ii) sufficient to satisfy any
contracts to which the Company or any of the Subsidiaries are bound and have
paid all premiums due and owing on such policies. Neither the Company nor any
of the Subsidiaries have been refused any insurance coverage sought or applied
for, and the Company has no reason to believe that it will be unable to renew
its existing insurance coverage.
(b) Upon consummation of the Merger, all of the insurance policies
issued to the Company and referred to in Section 3.20(a) will be transferred to
the Successor and Successor will thereafter be entitled to all of the benefits
thereunder to which the Company was entitled immediately prior to the
consummation of the Merger.
3.21. Minute Books. The copies of the minutes of the Company, the Successor
and the Subsidiaries made available to the Purchasers contain an accurate
summary of all actions taken or approved at meetings of members, managers,
stockholders and directors, as the case may be, of the Company, the Successor
and the Subsidiaries and all actions by written consent without a meeting by
the directors, managers, members and stockholders of the Company, the Successor
and Subsidiaries since the respective times of creation of the Company, the
Successor and the Subsidiaries.
3.22. Taxes. The Company, the Successor and the Subsidiaries have filed or
caused to be filed all required Tax Returns with the appropriate governmental
agencies in all jurisdictions in which such Tax Returns are required to be
filed by the Company, the Successor or any of the Subsidiaries and all Taxes
shown on such Tax Returns payable by such entity have been properly accrued or
paid to the extent such Taxes have become due or are being contested in good
faith, and for which reserves therefor have been established by the Company in
accordance with generally accepted accounting principles. None of the Company,
the Successor nor any Subsidiary has executed any waiver or extensions of any
statute of limitations on the assessment or collection of any Tax or with
respect to any liability arising therefrom. None of the federal, state or local
income Tax Returns for the Company, the Successor or any of the Subsidiaries
have been audited by any taxing authority, including the United States Internal
Revenue Service. The Merger will qualify as a tax-free reorganization under
Section 368(a) of the Code. For purposes of this Section 3.22, "Taxes" means
any federal, state, or local taxes, assessments, interest, penalties,
deficiencies, fees and other governmental charges or impositions; and "Tax
Return" means any federal, state, or local tax return, report, statement and
other similar filings required to be filed by the Company with respect to
Taxes.
3.23. Labor Agreements and Actions. Neither the Company, the Successor nor
any of the Subsidiaries is bound by or subject to any contract, commitment or
arrangement with any labor union, and no labor union has requested or, to the
knowledge of the Company or the Successor, has sought to represent any of the
employees, representatives or agents of the Company, the Successor or any of
the Subsidiaries. Neither the Company, the Successor nor any of the
Subsidiaries has any collective bargaining agreements covering any of their
employees. Neither the Company, the Successor nor any of the Subsidiaries is
aware that any officer or key employee, or that any group of key employees,
intends to terminate their employment with the Company, the Successor or any of
the Subsidiaries, nor do the Company, the Successor or any of the Subsidiaries
have a present intention to terminate the employment of any of the foregoing.
The employment of each officer and employee of the Company, the Successor or
the Subsidiaries is terminable at the will of the Company, the Successor or the
Subsidiaries to the extent permitted by law. The Company, the Successor and the
Subsidiaries have complied with all applicable state and federal equal
employment opportunity and other laws related to employment. Neither the
Company, the Successor nor any of the Subsidiaries has any deferred
compensation, pension, profit sharing, bonus, issuance, severance or other
similar employee benefit plan or obligation covering any of their employees or
plans subject to the Employee Retirement Income Security Act of 1974. Neither
the Company, the Successor nor any of the Subsidiaries has any agreements or
arrangements with persons titled as independent contractors or consultants, as
a result of which, by virtue of the control exercised by the Company, the
Successor or the Subsidiaries, the type of work performed by the persons or any
other circumstances, said persons could reasonably be deemed to be employees of
the Company, the Successor or the Subsidiaries. Neither the Company, the
Successor nor any of the Subsidiaries is engaged in, nor has the Company, the
Successor or any of the Subsidiaries engaged in, any unfair labor practice
which could result in a Material Adverse Effect.
3.24. Projections. All projections and expressions of opinion or
predictions relating to the future sales and financial performance of the
Company, the Successor or the Subsidiaries previously delivered to the
Purchasers by the Company or the Subsidiaries or their representatives (the
"Projections") were made in good faith and prepared on a reasonable basis at
the time prepared by the Company or the Subsidiaries.
3.25. Environmental. Neither the Company, the Successor nor any of the
Subsidiaries has ever caused or permitted any Hazardous Material (as defined in
Section 8.14(c) hereof) to be disposed of on or under any real property owned,
leased or operated by the Company, the Successor or any of the Subsidiaries in
any manner not permitted by all applicable laws and no such real property has
ever been used by the Company, the Successor or any of the Subsidiaries as (a)
a disposal site or permanent storage site for any Hazardous Material or (b) a
temporary storage site for any Hazardous Material. All Hazardous Materials used
or generated by the Company, the Successor or any of the Subsidiaries or, to
the knowledge of the Company and the Successor, any business merged into or
otherwise acquired by the Company and the Successor or any of the Subsidiaries,
have been generated, accumulated, stored, transported, treated, recycled and
disposed of in compliance with all applicable laws and regulations, the
violation of which could result in a Material Adverse Effect. Neither this
Agreement, the Related Documents nor the transactions contemplated hereby and
thereby will result in any obligations for site assessment or cleanup, or
notification to or consent of any governmental agency or third party under any
transaction-triggered Environmental Law (as defined in Section 8.14(b) hereof)
known to the Company or the Successor.
3.26. Confidentiality Agreements. Each Manager (as defined in Section
8.14(d) hereof) of the Company, the Successor and each Subsidiary has entered
into a confidentiality agreement in the form attached to this Agreement as
Exhibit E.
3.27. Compliance with Law. The Company, the Successor and the Subsidiaries
have conducted their businesses and are in compliance with all applicable
federal, state and local laws, statutes, licensing requirements, rules and
regulations, and, to the knowledge of the Company and the Successor, judicial
or administrative decisions applicable to the conduct of their businesses, in
any case, except where such noncompliance would not result in the termination
of, the material impairment or forfeiture of any of the Company's, the
Successor's or the Subsidiaries' rights under, or any payments being made by
the Company, the Successor or its Subsidiaries with respect to any of the
Contracts (as defined in Section 8.14(a) hereof). Neither the Company, the
Successor nor any Subsidiary has received any citations, complaints, consent
orders, compliance schedules or other similar enforcement orders or received
any other notice from any governmental authority or person regarding the
violation of, or failure to comply with, any legal requirements relating to the
operations or any assets or properties of the Company, the Successor and any of
the Subsidiaries that could result in a Material Adverse Effect.
3.28. Business. Neither the Company, the Successor nor any Subsidiary is
(a) engaged in any business other than (i) building riser systems, installing
horizontal wiring to the customers, and installing associated equipment in
multi-tenant office buildings to provide integrated voice, data and enhanced
services to tenants within the buildings, (ii) providing similar integrated
voice, data and enhanced services to small and medium-sized businesses not
within the foregoing buildings, and (iii) paying referral fees to approved
vendors and strategic partners for certain sales brought to the Company; or (b)
an "investment company" within the meaning of the Investment Company Act of
1940, as amended.
3.29. Absence of Certain Commercial Practices. Neither the Company, the
Successor nor any of the Subsidiaries nor, to the knowledge of the Company or
the Successor, any officer, director, employee or agent of the Company, the
Successor or any of the Subsidiaries (or any person acting on behalf of any of
the foregoing), has (i) given or agreed to give any gift or similar benefit of
more than nominal value on behalf of the Company, the Successor or any
Subsidiary to any official of any governmental authority (domestic or foreign),
to induce the recipient or his employer to do business, grant favorable
treatment or compromise or forego any claim, (ii) made any payment which is
illegal under prevailing law (regardless of the jurisdiction in which such
payment was made) to promote or retain sales or to help procure or maintain
good relations with suppliers, (iii) engaged in any activity which constitutes
a violation of the Foreign Corrupt Practices Act of 1977, as amended, and the
rules and regulations promulgated thereunder, (iv) engaged in any practice
violating any United States federal law prohibiting compliance with an
unsanctioned foreign boycott or (v) failed to perform its obligations in any
respect under any contract with, or violated in any material respect any
federal law known to the Company, the Successor or any of the Subsidiaries in
its dealings with, the federal government or any agency or department thereof,
including, but not limited to, any law with respect to conspiracy to defraud,
false claims, conspiracy to defraud the United States, embezzlement or theft of
public money, fraud and false statements, false demands against the United
States, mail fraud, wire fraud, RICO, and truth in negotiations, which failure
or violation would result in a Material Adverse Effect. No such gift or benefit
is required in connection with the operations of the Company, the Successor or
any of the Subsidiaries or their businesses to avoid any fine, penalty, cost,
expense or change in the business, assets, properties, operations or financial
condition of the Company, the Successor or any of the Subsidiaries which would
result in a Material Adverse Effect.
3.30. Small Business Investment Act.
(a) The Company, together with its "affiliates" (as that term is
defined in Title 13 of the United States Code of Federal Regulations) is a
"Small Business" within the meaning of the Small Business Investment Act of
1958, as amended (the "Small Business Investment Act"), and the regulations
promulgated thereunder (including Parts 107 and 121 of Title 13 of the United
States Code of Federal Regulations). The information provided by the Company on
SBA Forms 480, 652 and 1031 delivered in connection herewith is true and
correct.
(b) The proceeds of the transactions contemplated by this Agreement
will be used by the Successor solely to fund working capital and for general
corporate purposes. No portion of such proceeds (i) will be used to purchase
stock in, provide capital to or repay any indebtedness incurred for the purpose
of investing in a company licensed under the Small Business Investment Act,
(ii) will be used to acquire realty or to discharge an obligation relating to
the prior acquisition of realty, (iii) will be used outside the United States
(except to acquire abroad materials and equipment or property rights for use or
sale in the United States), or (iv) will be used for any purpose contrary to
the public interest (including but not limited to activities which are in
violation of law) or inconsistent with free competitive enterprise, in each
case, within the meaning of ss. 107.720 of Title 13 of the United States Code
of Federal Regulations.
(c) Neither the Company's, the Successor's nor any Subsidiary's
primary business activity involves, directly or indirectly, providing funds to
others, the purchase or discounting of debt obligations, factoring or long-term
leasing of equipment with no provision for maintenance or repair, and neither
the Company, the Successor or any Subsidiary is classified under Major Group 65
(Real Estate) or Industry No. 1531 (Operative Builders) of the SIC Manual. None
of the Company's, the Successor's nor any Subsidiary's employees or tangible
assets are located outside of the United States.
3.31. Year 2000. The Company and the Successor have reviewed their
respective operations and those of the Subsidiaries to evaluate the extent to
which the business or operations of the Company, the Successor or any of the
Subsidiaries will be affected by the Year 2000 Problem. As a result of such
review, the Company and the Successor have no reason to believe, and do not
believe, that the Year 2000 Problem will have a Material Adverse Effect;
PROVIDED, HOWEVER, that the Company does not make any representation or
warranty as to the operation of any telecommunications network operated by an
incumbent or competing local exchange carrier which may be affected by the Year
2000 Problem. The "Year 2000 Problem" as used herein means any significant risk
that computer hardware or software used in the receipt, transmission,
processing, manipulation, storage, retrieval, retransmission or other
utilization of data or in the operation of mechanical or electrical systems of
any kind will not, in the case of dates or time periods occurring after
December 31, 1999, function at least as effectively as in the case of dates or
time periods occurring prior to January 1, 2000.
Section 4. Representations, Warranties and Covenants of the Purchasers.
4.1. Representations and Warranties of the Purchasers. Each Purchaser
hereby represents and warrants to the Company with respect to itself only and
not with respect to any other Purchaser with respect to the purchase of the
Shares to be purchased by it as follows:
(a) Experience. Purchaser has substantial experience in evaluating and
investing in private placement transactions so that Purchaser is capable of
evaluating the merits and risks of Purchaser's investment in the Company.
Purchaser, by reason of its business or financial experience or the business or
financial experience of its professional advisors who are unaffiliated with and
who are not compensated by the Company or any affiliate or selling agent of the
Company, directly or indirectly, is aware of the risks and has the capacity to
protect its own interests in connection with the purchase of the Shares under
this Agreement.
(b) Investment. Purchaser is acquiring the Shares and the Common Stock
issuable upon conversion of the Series C Preferred and the Series D Preferred
for investment for Purchaser's own account, not as a nominee or agent, and not
with the view to, or for resale in connection with, any distribution thereof in
violation of the federal securities laws. Purchaser understands that the Shares
and the Common Stock issuable upon conversion of the Series C Preferred and the
Series D Preferred have not been, and will not be, registered under the
Securities Act by reason of a specific exemption therefrom, and that any such
exemption will depend, among other things, upon the bona fide nature of the
investment intent and the accuracy of such Purchaser's representations as
expressed in this Agreement. Purchaser has not been formed for the specific
purpose of acquiring the Shares or the Common Stock issuable upon conversion of
the Series C Preferred and the Series D Preferred.
(c) Rule 144. Purchaser acknowledges that the Shares and the Common
Stock issuable upon conversion of the Series C Preferred and the Series D
Preferred must be held indefinitely unless subsequently registered under the
Securities Act or an exemption from such registration and any applicable state
laws is available. Purchaser is aware of the provisions of Rule 144 promulgated
under the Securities Act which permit limited resale of shares purchased in a
private placement subject to the satisfaction of certain conditions, including,
among other things, the existence of a public market for the shares, the
availability of certain current public information about the Successor, the
resale occurring not less than one year after a party has purchased and paid
for the security to be sold, the sale being effected through a "broker's
transaction" or in transactions directly with a "market maker" (as provided by
Rule 144(f)) and the number of shares being sold during any three-month period
not exceeding specified limitations.
(d) No Public Market. Purchaser understands that no public market now
exists for any of the securities issued by the Company, that the Company has
made no assurances that a public market will ever exist for the Shares or the
Common Stock issuable upon conversion of the Series C Preferred and the Series
D Preferred and that, even if such a public market exists at some future time,
the Company may not then be satisfying the current public information
requirements of Rule 144.
(e) Access to Data. Purchaser and its representatives have met with
representatives of the Company and thereby have had the opportunity to ask
questions of, and receive answers from, said representatives concerning the
Company and the terms and conditions of this transaction as well as to obtain
any information requested by Purchaser. Any questions raised by Purchaser or
its representatives concerning the transaction have been answered to the
satisfaction of Purchaser and its representatives. Purchaser's decision to
purchase the Shares is based in part on the answers to such questions as
Purchaser and its representatives have raised concerning the transaction and on
its own evaluation of the risks and merits of the purchase and the Company's
proposed business activities. Notwithstanding the foregoing, no investigation
made by or on behalf of any Purchaser shall in any way affect any
representations, warranties, covenants or agreements made by the Company
pursuant to this Agreement and the Related Documents. The Purchaser also hereby
acknowledges that the Projections, including the basis therefor, were subject
to change following the date of the preparation thereof due to a change in
facts or circumstances subsequent to such time of preparation and that the
performance of the Company subsequent to their preparation has not been as
projected.
(g) Legal Power. Purchaser has all requisite legal power to execute
and deliver this Agreement and the Related Documents to which it is a party, to
purchase the Shares hereunder and to carry out and perform its obligations
under the terms of this Agreement and the Related Documents to which it is a
party.
(h) Authorization. All action on the part of the Purchaser under its
constituent agreements, its directors, members, partners or stockholders
necessary for the authorization, execution, delivery and performance of this
Agreement and the Related Documents to which it is a party by the Purchaser and
the performance of all of the Purchaser's obligations under this Agreement and
the Related Documents to which it is a party has been taken. This Agreement,
and the Related Documents to which it is a party, when executed and delivered
by the Purchaser will constitute a valid and legally binding obligation of the
Purchaser, enforceable in accordance with their respective terms, subject to
laws of general application relating to bankruptcy, insolvency and the relief
of debtors and rules of law governing specific performance, injunctive relief
or other equitable remedies.
(i) Compliance with Other Instruments, Etc.. The execution, delivery
and performance of this Agreement and the Related Documents by the Purchaser
have not resulted and will not result in any violation of, or conflict with, or
constitute a breach or default (with or without the passage of time and giving
of notice or both) under, (a) the constituent documents of the Purchaser or (b)
any mortgage, indebtedness, indenture, contract, agreement, instrument,
judgment or decree, order, statute, rule, law or regulation applicable to the
Purchaser.
(j) Consent, Etc. Except for the consent of the FCC and state public
utility commissions, no consent, approval, license or authorization of or
designation, declaration, registration or filing with any court or governmental
authority or any party to any contract to which the Purchaser is a party or any
other third party is required to be obtained by the Purchaser in connection
with the valid execution and delivery by the Purchaser of this Agreement and
the Related Documents to which it is a party or the consummation by the
Purchaser of any transaction contemplated by this Agreement that has not been
obtained.
(k) Brokers or Finders. The Company has not incurred, and will not
incur, directly or indirectly, as a result of any action taken by the Purchaser
any liability for brokerage or finders' fees or agents' commissions or any
similar charges in connection with this Agreement.
(l) Accredited Investor. Purchaser is an "accredited investor" as such
term is defined in Rule 501(a) of Regulation D promulgated under the Securities
Act.
4.2. Legends. Each Purchaser hereby agrees that each certificate
representing shares of Series B Preferred, Series C Preferred or Series D
Preferred issuable to the Purchasers hereunder shall bear a legend containing
the following words:
"THE SECURITIES REPRESENTED BY THIS CERTIFICATE HAVE NOT
BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS
AMENDED. THE SECURITIES HAVE BEEN ACQUIRED FOR INVESTMENT
AND MAY NOT BE SOLD, TRANSFERRED OR OTHERWISE DISPOSED OF
EXCEPT IN COMPLIANCE WITH SUCH ACT."
The requirement that the foregoing legend be placed upon certificates
evidencing any such securities shall cease and terminate upon the earliest of
the following events: (i) when such shares are transferred in a public offering
under the Securities Act, (ii) when such shares are transferred pursuant to
Rule 144 under the Securities Act or (iii) when such shares are transferred in
any other transaction if the seller delivers to the Successor an opinion of its
counsel, which counsel and opinion shall be reasonably satisfactory to the
Successor, or a "no-action" letter from the staff of the SEC, in either case to
the effect that such legend is no longer necessary in order to protect the
Successor against a violation by it of the Securities Act upon any sale or
other disposition of such shares without registration thereunder. Upon the
occurrence of any event requiring the removal of a legend hereunder, the
Successor, upon the surrender of certificates containing such legend, shall, at
its own expense, deliver to the holder of any such shares as to which the
requirement for such legend shall have terminated, one or more new certificates
evidencing such shares not bearing such legend.
Section 5. Conditions to Closing of the Purchasers.
Each Purchaser's obligations to purchase its Shares at the First Closing
and each Subsequent Closing are subject to the fulfillment or waiver as of the
First Closing Date and each Subsequent Closing Date, as applicable, of the
following conditions:
5.1. Representations and Warranties.
(a) The representations and warranties set forth in Section 3 of this
Agreement shall be true and correct as of the date of this Agreement.
(b) The representations and warranties set forth in Sections 3.1(b),
3.2(b), 3.3, 3.4(b), 3.7(a), 3.11, 3.17 and 3.20(b) of this Agreement shall be
true and correct, with the same force and effect as if they had been made on
the First Closing Date.
5.2. Covenants. All covenants, agreements and conditions contained in this
Agreement to be performed by the Company on or prior to the First Closing Date
shall have been performed or complied with in all material respects.
5.3. Qualifications and Consents. All authorizations, approvals and
permits, if any, of any governmental authority or regulatory body and all
consents and approvals of any third party required for the lawful consummation
of the transactions provided for herein (including the issuance of shares of
Common Stock upon conversion of the Series C Preferred and the Series D
Preferred) shall have been duly obtained and effective as of the First Closing
Date and each Subsequent Closing Date, as applicable, without the imposition of
any conditions materially adverse to the Purchasers.
5.4. Compliance Certificate. On the First Closing Date, the Successor shall
have delivered to the Purchasers a certificate of the Successor, executed by
the President of the Successor, dated the First Closing Date and certifying,
among other things, the fulfillment of the conditions specified in Sections
5.1, 5.2 and 5.3 of this Agreement.
5.5. Certificate of Designation; Corporate Proceedings. Prior to the First
Closing, the Certificate of Designation shall have been filed with the
Secretary of State of the State of Delaware and all corporate and other
proceedings in connection with the transactions contemplated by this Agreement
and all documents incident thereto shall be satisfactory in form and substance
to the Purchasers' legal counsel and the Purchasers shall have received all
counterpart original and certified or other copies of such documents as they
may reasonably request.
5.6. Rights Agreement. Prior to or at the First Closing, the Successor and
the Purchasers shall have executed and delivered the Rights Agreement.
5.7. Opinions of Company Counsel. At the First Closing, the Purchasers
shall have received from Xxxxxxx, Xxxxxxxxx LLP, counsel for the Successor, an
opinion, dated as of the First Closing Date, in substantially the form of
Exhibit F attached hereto. At the First Closing, the Purchasers shall have
received from Fried, Frank, Harris, Xxxxxxx & Xxxxxxxx, special counsel for the
Successor, an opinion, dated as of the First Closing Date, in substantially the
form of Exhibit G attached hereto. At the First Closing, the Purchasers shall
have received from Mintz, Levin, Cohn, Ferris, Glovsky and Popeo, P.C., special
counsel for the Successor, an opinion, dated as of the First Closing Date, in
substantially the form of Exhibit H attached hereto.
5.8. Voting Agreement. Prior to or at the First Closing, the Successor and
the Purchasers shall have executed and delivered the Voting Agreement.
5.9. Secretary's Certificate. On the First Closing Date, the Successor
shall have delivered to the Purchasers a certificate of the Successor, executed
by the Secretary of the Successor, dated the First Closing Date, and
certifying, among other things, copies of resolutions of the stockholders and
board of directors of the Successor authorizing and approving the execution,
delivery and performance by the Company and the Successor of this Agreement and
each of the Related Documents to which it is a party, including, without
limitation, the issuance and sale of the Shares and the issuance of the shares
of Common Stock upon conversion of the Series C Preferred and the Series D
Preferred.
5.10. Board of Directors. On the First Closing Date, the Successor shall
have secured any necessary resignations of directors and shall have validly
elected directors such that immediately upon consummation of the First Closing,
the board of directors of the Successor shall consist of the directors
specified in Exhibit I attached hereto.
5.11 February 10, 1999 Letter Agreement. On or prior to the First Closing
Date, that certain letter agreement by and among RSI-OSA Holdings, Inc., a
Delaware corporation ("RSI"), and Veritech Ventures LLC, a New York limited
liability company ("Veritech"), dated as of February 10, 1999, shall have been
terminated.
Section 6. Conditions to Closing of the Successor.
The Successor's obligation to sell and issue the Shares at the First
Closing and each Subsequent Closing is, at the option of the Successor, subject
to the fulfillment or waiver of the following conditions:
6.1. Representations. The representations and warranties set forth in
Section 4 of this Agreement shall be true and correct as of the date of this
Agreement.
6.2. Covenants. All covenants, agreements and conditions contained in this
Agreement to be performed by the Purchasers on or prior to the First Closing
Date shall have been performed or complied with in all material respects.
6.3. Rights Agreement. The Purchasers shall have executed and delivered the
Rights Agreement.
Section 7. Covenants of the Company and the Successor.
7.1. Consummation of Merger. The Company and the Successor shall consummate
the Merger on the first business day after the Company has received all
regulatory approvals from the FCC and the NYPSC necessary to effect the
transactions contemplated by this Agreement.
7.2. Information Rights. The Company and the Successor hereby covenant and
agree as follows:
(a) The Successor will mail by first class, postage prepaid the
following reports to the Purchasers:
(i) As soon as practicable after the end of each fiscal month, and
in any event within thirty-five (35) days thereafter, an unaudited consolidated
balance sheet of the Successor and the Subsidiaries, as of the end of such
fiscal month, and unaudited consolidated statements of income and unaudited
consolidated statements of cash flows and notes thereto of the Successor and
the Subsidiaries, for such month and for the current fiscal year to date. Such
financial statements shall be prepared in accordance with generally accepted
accounting principles consistently applied (other than for accompanying notes),
all in reasonable detail.
(ii) As soon as practicable after the end of each fiscal year, and
in any event within seventy-five (75) days thereafter, a consolidated balance
sheet of the Successor and the Subsidiaries, as of the end of each such fiscal
year, and consolidated statements of income and consolidated statements of cash
flows and notes thereto of the Successor and the Subsidiaries, for such fiscal
year. Such financial statements shall be prepared in accordance with generally
accepted accounting principles consistently applied (other than for
accompanying notes), all in reasonable detail and shall be audited by an
independent public accounting firm reasonably acceptable to the Purchasers.
(iii) As soon as practicable, but in any event forty-five (45)
days prior to the end of each fiscal year, a budget for the next fiscal year,
prepared on a monthly basis, including balance sheets, income statements and
statements of cash flows for such months and, as soon as prepared, any
revisions to such budget prepared by the Successor, and describing in detail,
at a minimum, management's assumptions with respect to (1) revenues, (2)
customers and contracts, (3) operating costs and (4) capital expenditures.
(b) Purchasers shall have access to the Company's, the Successor's and
the Subsidiaries' books, records and facilities during normal business hours
which does not unduly interfere with the operation of the Company, the
Successor and the Subsidiaries, and reasonable access to the Company's, the
Successor's and the Subsidiaries' officers or managing members or similar
representatives to discuss the Company's, the Successor's and the Subsidiaries'
accounts, finances and affairs.
(c) The information rights set forth in this Section 7.2 may not be
transferred, except to an affiliate, partner, member or former partner or
member of a Purchaser which holds Shares, without the prior written consent of
the Successor, not to be unreasonably withheld.
(d) The information rights set forth in this Section 7.2 shall
terminate on and be of no further force or effect upon the earlier of (i) the
consummation of the Successor's sale of its Common Stock in an underwritten
public offering pursuant to an effective registration statement filed under the
Securities Act (PROVIDED, that the offering results in aggregate gross cash
proceeds to the Successor of at least $30,000,000, and immediately subsequent
to which the Successor shall be obligated to file annual and quarterly reports
with the Commission pursuant to Section 13 or 15(d) of the Securities Exchange
Act of 1934, as amended (the "Exchange Act") or (ii) the registration by the
Successor of a class of its equity securities under Section 12(b) or 12(g) of
the Exchange Act.
7.3. Certain Affirmative and Negative Covenants. Except as set forth in
Section 7.3 of the Disclosure Schedule or unless otherwise agreed to in writing
by Purchasers who will hold eighty percent (80%) or more of the Series C
Preferred and the Series D Preferred immediately following the Subsequent
Closings, the Company and the Successor covenant and agree that except for the
consummation of the interim financing provided to the Company concurrently with
the execution of this Agreement and pending consummation of the Merger (the
"Interim Financing"), from and after the date hereof and until the First
Closing Date:
(a) Each will conduct its business, and will cause each Subsidiary to
conduct its business, only in the ordinary course of business in a manner
consistent with past practices.
(b) Each will, and will cause each Subsidiary to, use their reasonable
commercial efforts to maintain and preserve their respective business
organizations, relationships with customers, suppliers and others having
business dealings with them, and all assets, employees, regulatory licenses and
approvals.
(c) Other than the adoption by the Successor of the 1999 Stock Option
Plan or the issuance of options thereunder, neither of them will, and each of
them will cause the Subsidiaries not to, directly or indirectly (i) issue,
sell, transfer, pledge, dispose of or encumber, or authorize or agree to the
issuance, sale, pledge, transfer, disposition or encumbrance of, any membership
or ownership interests in or capital stock of the Company, the Successor or any
of the Subsidiaries (except for shares issuable upon exercise of options
outstanding under the 1999 Stock Option Plan), (ii) issue, sell, pledge,
transfer or dispose of, or authorize or agree to the issuance, sale, pledge,
transfer or disposition of any options, warrants or rights of any kind to
acquire any membership or ownership interest in or any shares of capital stock
or any other equity securities of or any securities convertible into or
exchangeable for any membership or ownership interest in or shares of capital
stock or any other equity securities of the Company, the Successor or any
Subsidiary, (iii) authorize any change in its capitalization, or (iv) adopt a
plan of complete or partial liquidation, dissolution, merger, consolidation,
restructuring, recapitalization or other reorganization (other than the
Merger).
(d) Neither of them will, and each of them will cause the Subsidiaries
not to, directly or indirectly (i) except in the ordinary course of business
and consistent with past practices, sell, pledge, transfer, lease, sell and
leaseback, assign, license, dispose of or encumber any asset or (ii) whether or
not in the ordinary course of business, sell, pledge, transfer, lease, sell and
leaseback, assign, license, dispose of or encumber any material asset of the
Company, the Successor or any subsidiary.
(e) Neither of them will, and each of them will cause the Subsidiaries
not to, directly or indirectly (i) split, combine or reclassify any ownership
or membership interests or shares of capital stock or declare, set aside or pay
any dividend or distribution, payable in cash, stock, property or otherwise
with respect to any of its ownership or membership interests or capital stock
other than dividends and distributions by a Subsidiary to the Company, or (ii)
redeem, purchase or otherwise acquire or offer or agree to redeem, purchase or
otherwise acquire any membership or ownership interest or shares of capital
stock.
(f) Neither of them shall, and each of them shall cause the
Subsidiaries not to, directly or indirectly, acquire (by merger, consolidation
or acquisition of stock or assets) any corporation, partnership or other
business organization or division thereof or make any investment either by
purchase of stock or securities, contributions to capital, loans, advances,
property transfer or purchase of any amount of property or assets, in any other
individual or entity or form any subsidiaries.
(g) Neither of them shall, and each of them shall cause the
Subsidiaries not to, directly or indirectly, incur any indebtedness for
borrowed money (other than the Interim Financing), issue any debt securities or
enter into any capitalized leases other than entered into in the ordinary
course of business or assume, guarantee, endorse, secure or otherwise as an
accommodation become responsible for, the obligations of any other person or
entity (other than a Subsidiary). For purposes of this subsection,
"indebtedness for borrowed money" means with respect to the Company or any of
the Subsidiaries, all indebtedness in respect of money borrowed, including
without limitation all capital leases and the deferred purchase price of any
property or asset, evidenced by a promissory note, bond, debenture or similar
written obligation for the payment of money (including conditional sales or
similar title retention agreements), other than trade payables incurred in the
ordinary course of business.
(h) Neither of them shall, and each of them shall cause the
Subsidiaries not to, take any action with respect to the grant of any severance
or termination pay (other than pursuant to policies or written agreements of
the Company in effect on the date hereof) or with respect to any increase of
benefits payable under its severance or termination pay policies or written
agreements in effect on the date hereof.
(i) Other than the adoption by the Successor of the 1999 Stock Option
Plan or the issuance of options thereunder, neither of them shall, and each of
them shall cause the Subsidiaries not to, adopt, enter into or amend any bonus,
profit sharing, compensation, stock option, pension, retirement, deferred
compensation, employment, severance, retention or stay or other employee
benefit plan, agreement, trust, fund or other arrangement for the benefit or
welfare of any director, officer, member or employee or increase in any manner
the compensation or fringe benefits of any director, officer, member or
employee or pay any benefit not required by any plan, arrangement or agreement
in effect on the date hereof.
(j) Neither of them shall, and each of them shall cause the
Subsidiaries not to, enter into any contract or agreement other than in the
ordinary course of business. (k) Neither of them shall, and each of them shall
cause the Subsidiaries not to:
(i) waive or compromise any material right or material debt owed
to it, other than waivers granted in the ordinary course of business which,
individually and in the aggregate, would not have a Material Adverse Effect;
(ii) satisfy or discharge any material lien, claim or encumbrance
or pay any obligation except in the ordinary course of business or in
accordance with the terms of the Bridge Financing and litigation disclosed in
Section 3.9 of the Disclosure Schedule;
(iii) modify any material contract, agreement or arrangement to
which the Company, the Successor or any Subsidiary is a party or by which any
of their respective assets is bound or subject; and
(iv) make any payment, loan or advance to, or sell, transfer or
lease any properties or assets to, or enter into any other agreement or
arrangement with, any officer, director, stockholder, member or other
affiliates of or any consultant to the Company, the Successor or any
Subsidiary, except (i) for normal business advances to employees consistent
with past practice, (ii) pursuant to written agreements listed in Section
3.6(o) of the Disclosure Schedule, and (iii) for the payment of compensation to
officers in a manner and in amounts consistent with past practice.
(l) Neither of them shall take any action, and each of them shall
cause the Subsidiaries not to take any action, that will result in a violation,
breach or default (with or without the passage of time and giving of notice for
both) in (i) any term of their operating agreement, certificate of
incorporation or bylaws, or (ii) any term or provision of any material
mortgage, indebtedness, indenture, contract, agreement or instrument to which
the Company, the Successor or any of the Subsidiaries is a party or their
property is bound, which violation, breach or default could have a Material
Adverse Effect. Each of them shall take such action as shall be necessary to
assure that the Company, the Successor and the Subsidiaries are and remain in
compliance with all judgments, decrees, governmental orders, laws, statutes,
rules and regulations by which they are bound or to which they or any of their
properties or assets is subject, except where the failure to do so would not
have a Material Adverse Effect.
(m) Each of them shall, and shall cause each Subsidiary to, keep
adequate books and records with respect their respective business activities in
which proper entries, reflecting all financial transactions, are made in
accordance with generally accepted accounting principles and on a basis
consistent with the financial statements previously delivered to the
Purchasers.
(n) Each of them shall, and shall cause the Subsidiaries to, conduct
their business in compliance with all applicable federal, state, local and
foreign laws and regulations, except to the extent that a failure to comply,
individually or in the aggregate, would not have a Material Adverse Effect.
(o) Neither of them shall, and each shall cause the Subsidiaries not
to, take any action that will result in the Company, the Successor or any of
the Subsidiaries incurring, directly or indirectly, any liability for brokerage
or finders' fees or agents' commissions or any similar charges in connection
with the transactions contemplated by this Agreement.
(p) Neither of them shall, and each of them shall take such action as
shall be necessary to assure that neither of the Subsidiaries will, become
indebted, directly or indirectly, to any officer, director, member or holder of
5% or more of the equity or voting power of the Company, the Successor or any
Subsidiary or to their respective spouses, parents, children or siblings or
their respective affiliates, in any material amount exclusive of any
obligations existing on the date of this Agreement.
(q) Neither of them shall, and each of them shall take such action as
shall be necessary to assure that no Subsidiary will, become a party to or
bound by any of the Contracts, agreements, instruments, documents, commitments
and similar items described in Section 3.16(a)(i) through (ix) other than in
the ordinary course of business.
(r) They shall conduct the business of the Company, the Successor and
the Subsidiaries in a manner that does not result in a violation or breach any
provision of any Contract, which violation or breach could have a Material
Adverse Effect.
(s) Neither of them shall, and each of them shall take such action as
shall be necessary to assure that neither of the Subsidiaries will, grant or
agree to grant any registration rights or preemptive rights to any person or
entity.
(t) Each of them shall, and shall cause the Subsidiaries to, file all
required Tax Returns with the appropriate governmental agencies in all
jurisdictions in which the Tax Returns are required to be filed by the Company,
the Successor or any of the Subsidiaries and pay all Taxes shown on such Tax
Returns as and when due.
(u) Neither of them shall, and each of them shall cause the
Subsidiaries not to, engage in any business other than the business described
in Section 3.28 hereof.
7.4. Protective Rights. If, after the First Closing Date, the Successor
grants to any holder of shares of the Successor's Preferred Stock any rights
regarding anti-dilution protection on terms more favorable than those set forth
in the Certificate of Designation, then the Successor shall take such action as
may be necessary to grant the Purchasers equivalent rights.
7.5. Other Actions. The Company and the Successor shall take all actions
reasonably necessary to fulfill the conditions to closing to be fulfilled by it
set forth in Section 5 of this Agreement, and shall refrain from taking any
action that would prevent satisfaction of any such condition.
7.6. Consents. The Successor shall effect the filing of the Certificate of
Designation in the office of the Secretary of State of the State of Delaware
and filing of such notice as required by Section 25102(f) of the California
Corporate Securities law of 1968, and the compliance with other applicable blue
sky laws within the applicable time periods therefor in accordance with
applicable law.
7.7. Use of Proceeds. The Successor shall use the proceeds from the sale of
the Shares for working capital and general corporate purposes, including, but
not limited to, acquisitions, joint ventures, strategic partnerships and
investments in businesses, products and technologies that are complimentary to
those of the Company (but excluding any acquisitions, joint ventures, strategic
partnerships and investments that are not consistent with the Successor's
business plan as then in effect). The Successor shall not use the proceeds from
the sale of the Shares to repay or redeem any indebtedness of the Company
outstanding as of the date hereof, except for repayment of amounts owed under
the Bridge Financing.
7.8. Reimbursement of Directors' Expenses. The Successor shall reimburse
the Investor Directors (as defined in the Voting Agreement) for out-of-pocket
expenses incurred by them in attending meetings of the board of directors of
the Successor.
7.9. Confidentiality Agreements. The Company and the Successor will seek to
obtain from each employee of the Company and Successor and the Subsidiaries a
confidentiality agreement in the form attached to this Agreement as Exhibit E.
7.10. Small Business Investment Act.
(a) The Company and the Successor will provide to XX Xxxxxx Investment
Corporation ("JPMIC") (upon reasonable notice and during normal business hours)
and the U.S. Small Business Administration access to the Company's or the
Successor's books and records for the purpose of confirming the use of the
proceeds of the transactions contemplated by this Agreement and for all other
purposes required by the U.S. Small Business Administration. Upon the request
of JPMIC, the Successor will promptly provide to JPMIC and the U.S. Small
Business Administration a certificate of the chief financial officer (or other
executive officer) of the Successor verifying the use of such proceeds and
certifying compliance by the Successor with the provisions of Section 3.30 of
this Agreement.
(b) Upon the reasonable request of JPMIC, the Company and the
Successor promptly (and in any event within twenty (20) days of such request)
will use commercially reasonable efforts to provide to JPMIC all information
reasonably requested by JPMIC in order for JPMIC to prepare and file SBA Form
468.
(c) For a period of one year following the date hereof, neither the
Company nor the Successor will change its business activity if such change
would result in (i) its primary business activity being, directly or
indirectly, providing funds to others, the purchase or discounting of debt
obligations, factoring or long-term leasing of equipment with no provision for
maintenance or repair, (ii) it being classified under Major Group 65 (Real
Estate) or Industry No. 1531 (Operative Builders) of the SIC Manual, or (iii) a
majority of its tangible assets or employees being located outside of the
United States.
(d) The Company and the Successor promptly will provide to JPMIC such
financial statements and other information as JPMIC may from time to time
reasonably request for the purpose of assessing the financial condition of the
Company or the Successor, as applicable, and complying with any requirements of
any governmental agency asserting jurisdiction over JPMIC.
7.11. Videoconferencing Equipment. Following the execution and delivery of
this Agreement, the Company shall install videoconferencing equipment at its
headquarters within a reasonable period of time.
7.12. Transactions in Securities. The Company and the Successor shall not,
and they shall cause each of the Subsidiaries and all persons acting on behalf
of the Company, the Successor or any of the Subsidiaries not to, sell or offer
to sell the Shares or similar securities to, or solicit offers to buy the
Shares or similar securities from, any Person so as to bring the issuance and
sales of the Shares and the shares of Common Stock issuable upon conversion of
the Series C Preferred and the Series D Preferred under the registration
provisions of the Securities Act or applicable state securities laws.
7.13. OnSite Commerce and Content LLC. The Company shall, and shall cause
OnSite Commerce and Content LLC to, execute an amendment to the Intercompany
Agreement between the Company and OnSite Commerce and Content LLC, a New York
limited liability corporation, dated as of February 20, 1998, in the form
attached hereto as Exhibit J.
Section 8. Miscellaneous.
8.1. Governing Law. This Agreement shall be governed in all respects by the
laws of the State of New York.
8.2. Survival; Termination. Subject to the last sentence of this Section
8.2, the representations and warranties made in this Agreement shall survive
the execution and delivery of this Agreement and the First Closing and each
Subsequent Closing and shall in no way be limited, diminished or affected by
any investigation made by or on behalf of the Purchasers. The covenants and
agreements contained herein shall survive until the termination of this
Agreement. This Agreement, including the representations and warranties made
herein, will terminate on the closing of an underwritten public offering
pursuant to an effective registration statement under the Securities Act,
covering the offer and sale of Common Stock for the account of the Successor to
the public (i) based upon a Successor valuation exceeding Three Hundred Million
Dollars ($300,000,000) prior to the offering, (ii) resulting in gross proceeds
to the Successor of at least Thirty Million Dollars ($30,000,000), and (iii)
managed by a nationally recognized underwriter reasonably acceptable to the
Purchasers (a "Qualified IPO").
8.3. Successors and Assigns. Except as otherwise provided in this
Agreement, the provisions of this Agreement shall inure to the benefit of, and
be binding upon, the successors, heirs, executors and administrators of the
parties to this Agreement. This Agreement may not be assigned by any party
hereto without the prior written consent of the other parties to this Agreement
and prior to obtaining all necessary approvals; PROVIDED, HOWEVER, that this
Agreement may be assigned to any affiliate of a Purchaser or any subsequent
holder of the Shares prior to a Qualified IPO, AND PROVIDED, FURTHER, that no
such assignment will release the assignor from its obligations hereunder. Any
attempted assignment of this Agreement in violation of the terms of this
Section 8.3 shall be void AB INITIO.
8.4. Entire Agreement, Amendment. This Agreement and the other documents
delivered pursuant to this Agreement and in connection herewith, including the
Related Documents, at the First Closing, constitute the full and entire
understanding and agreement between the parties with regard to the subjects
hereof and thereof, and supersede all prior agreements, and no party shall be
liable or bound to any other party in any manner by any warranties,
representations or covenants except as specifically set forth herein or
therein. Except as expressly provided in this Agreement, neither this Agreement
nor any term hereof may be amended, waived, discharged or terminated other than
by a written instrument signed by the party against whom enforcement of any
such amendment, waiver, discharge or termination is sought.
8.5. Notices, Etc. All notices and other communications required or
permitted under this Agreement shall be in writing and shall be mailed by
registered or certified mail, postage prepaid, or otherwise delivered by hand,
by messenger or by facsimile (subsequently confirmed by telephone), addressed
or transmitted (a) if to a Purchaser, at such address or facsimile number as
the Purchaser shall have furnished to the Company in writing, or (b) if to any
other holder of any Shares, at such address or facsimile number as such holder
shall have furnished the Company in writing, or, until any such holder so
furnishes an address or facsimile number to the Company, then to and at the
address or facsimile number of the last holder of such Shares who has so
furnished an address or facsimile number to the Company, or (c) if to the
Company, one copy should be sent to its offices and addressed to the attention
of the President, or at such other address or facsimile number as the Company
shall have furnished to the Purchasers.
Each such notice or other communication shall for all purposes of this
Agreement be treated as effective or having been given when delivered if
delivered personally or by facsimile, or, if sent by mail, upon receipt.
8.6. Delays or Omissions. Except as expressly provided in this Agreement,
no delay or omission to exercise any right, power or remedy accruing to any
holder of any Shares, upon any breach or default of the Company under this
Agreement, shall impair any such right, power or remedy of such holder nor
shall it be construed to be a waiver of any such breach or default, or an
acquiescence therein, or of or in any similar breach or default thereafter
occurring; nor shall any waiver of any single breach or default be deemed a
waiver of any other breach or default theretofore or thereafter occurring. Any
waiver, permit, consent or approval of any kind or character on the part of any
holder of any breach or default under this Agreement, or any waiver on the part
of any holder of any provisions or conditions of this Agreement, must be in
writing and shall be effective only to the extent specifically set forth in
such writing. All remedies, either under this Agreement or by law or otherwise
afforded to any holder, shall be cumulative and not alternative.
8.7. California Corporate Securities Law. THE SALE OF THE SECURITIES WHICH
ARE THE SUBJECT OF THIS AGREEMENT HAS NOT BEEN QUALIFIED WITH THE COMMISSIONER
OF CORPORATIONS OF THE STATE OF CALIFORNIA AND THE ISSUANCE OF SUCH SECURITIES
OR THE PAYMENT OR RECEIPT OF ANY PART OF THE CONSIDERATION THEREFOR PRIOR TO
SUCH QUALIFICATION IS UNLAWFUL UNLESS THE SALE OF SECURITIES IS EXEMPT FROM THE
QUALIFICATION BY SECTION 25100, 25102 OR 25105 OF THE CALIFORNIA CORPORATIONS
CODE. THE RIGHTS OF ALL PARTIES TO THIS AGREEMENT ARE EXPRESSLY CONDITIONED
UPON SUCH QUALIFICATION BEING OBTAINED, UNLESS THE SALE IS SO EXEMPT.
8.8. Expenses. At the First Closing, the Successor shall pay the (i) fees
and expenses of Xxxxxx & Xxxxxxx and Xxxxxxxxx Xxxx LLP, (ii) accountants'
fees, (iii) consultants' fees and (iv) reasonable travel and other
diligence-related expenses, in each case, incurred by Purchasers in connection
with this Agreement, the documents referred to herein and the transactions
contemplated hereby and thereby, in an amount not to exceed $200,000 in the
aggregate.
8.9. Counterparts. This Agreement may be executed in any number of
counterparts, each of which may be executed by fewer than all of parties
hereto, each of which shall be enforceable against the parties actually
executing such counterparts, and all of which together shall constitute one
instrument.
8.10. Severability. In the event that any provision of this Agreement
becomes or is declared by a court of competent jurisdiction to be illegal,
unenforceable or void, this Agreement shall continue in full force and effect
without said provision; PROVIDED that no such severability shall be effective
if it materially changes the economic benefit of this Agreement to any party.
8.11. Titles and Subtitles. The titles and subtitles used in this Agreement
are used for convenience only and shall not be considered in construing or
interpreting this Agreement.
8.12. Further Assurances. Upon request of the Company or any of the
Purchasers, all parties hereto agree to promptly execute and deliver all such
other instruments and take all such other actions as any party hereto may
reasonably request from time to time in order to effectuate and carry out the
purposes, privileges, restrictions, rights and duties of the parties and the
other provisions of this Agreement and the Related Documents.
8.13. Specific Performance. The parties hereby declare that it is
impossible to measure in money the damages which will accrue to a party hereto
by reason of a failure to perform any of the obligations under this Agreement
and that a breach hereof shall cause irreparable injury and, in addition to any
other right or remedy available to the parties hereto at law or in equity, any
injured party hereunder shall be entitled to enforcement by court injunction or
specific performance of the obligations of the parties hereunder, without the
necessity for posting a bond. Notwithstanding the foregoing sentence, nothing
herein shall be construed as prohibiting any injured party hereunder from also
pursuing any other rights or remedies for such breach or threatened breach,
including receiving damages and attorneys' fees. The election of any remedy
shall not be construed as a waiver on the part of any injured party hereunder
of any right such party might otherwise have at law or in equity, which rights
and remedies shall be cumulative.
8.14. Defined Terms. For purposes of this Agreement:
(a) "Contracts" means all contracts, leases, licenses, mortgages,
evidences of indebtedness, indentures, instruments, arrangements,
understandings, commitments and other agreements (including leases for personal
or real property and employment agreements and including all amendments and
other modifications thereto) of the Company, the Successor or any of the
Subsidiaries or to which the Company, the Successor or any of the Subsidiaries
is a party or that are binding upon the Company, the Successor or any of the
Subsidiaries and that relate to or affect the business or operations of the
Company, the Successor or any of the Subsidiaries, and that are in effect on
the date of this Agreement or on the First Closing Date.
(b) "Environmental Law" shall mean the Resource Conservation and
Recovery Act, the Comprehensive Environmental Response, Compensation and
Liability Act of 1980, as amended, the Superfund Amendments and Reauthorization
Act of 1986, the Federal Water Pollution Control Act, the Toxic Substances
Control Act and any other federal, state or local statue, regulation,
ordinance, order or decree relating to the environment, as now or hereafter in
effect.
(c) "Hazardous Material" shall mean (i) any asbestos or insulation or
other material composed of or containing asbestos and (ii) any petroleum
product and any hazardous, toxic or dangerous waste, substance or material
defined as such in (or for purposes of) the Comprehensive Environmental
Response, Compensation and Liability Act of 1980, any so-called "Superfund" or
"Superlien" law, or any other Environmental Law, now or hereafter in effect.
(d) "Manager" shall mean each of Xxxxx Xxxxx, Xxxxxxx Xxxxxxx, Xxx
Xxxxxxxx, Xxxxx Xxxx and Xxxxx Xxxxxx.
(e) "Real Property" means (a) all fee estates in real property, and
all buildings and other improvements thereon, owned, leased or held by the
Company or a Subsidiary that are used or useful in the business or operations
of the Company or a Subsidiary; and (b) leases of any real property under which
the Company or a Subsidiary is the lessee that are used or useful in the
business or operations of the Company or a Subsidiary; together with any
additions thereto between the date of this Agreement and the First Closing.
[Signature Pages Follow]
The foregoing Series B, Series C and Series D Preferred Stock Purchase
Agreement is hereby executed as of the date first above written.
"COMPANY"
ONSITE VENTURES, L.L.C.
a Delaware limited liability company
By:____________________________________
Title:_________________________________
"SUCCESSOR"
ONSITE ACCESS, INC.
a Delaware corporation
By:____________________________________
Title:_________________________________
"PURCHASERS"
SPECTRUM EQUITY INVESTORS III, L.P.
By: Spectrum Equity Associates III, L.P.,
its General Partner
By:____________________________________
Name:
Title:
XX XXXXXX INVESTMENT CORPORATION
By:____________________________________
____________________________________
(Print Name)
____________________________________
Title
SIXTY WALL STREET SBIC FUND, L.P.
By: Sixty Wall Street SBIC Corporation, its General Partner
By: ____________________________________
____________________________________
(Print Name)
____________________________________
Title
CROSSPOINT VENTURE PARTNERS
By: ____________________________________
____________________________________
(Print Name)
____________________________________
Title
RSI-ONSITE HOLDINGS LLC
By: Reckson Service Industries, Inc.,
its sole member
By: ____________________________________
____________________________________
(Print Name)
____________________________________
Title
VERITECH VENTURES LLC
By: ____________________________________
____________________________________
(Print Name)
____________________________________
Title
AT&T VENTURE FUND II, LP
0000 Xxxx Xxxxx Xxxx
Xxxxxxxx 0, Xxxxx 000
Xxxxx Xxxx, XX 00000
By: Venture Management, LLC
its General Partner
Xxxx X. Xxxxxxx
Manager
XXXX XXXX
By: ____________________________________
ONSITE ACCESS, INC.
SERIES B, SERIES C AND SERIES D PREFERRED STOCK PURCHASE AGREEMENT
April 16, 1999
ATTACHMENT 1
SCHEDULE OF PURCHASERS
SERIES B PREFERRED:
TOTAL FIRST CLOSING
PURCHASER NO. OF SHARES PURCHASE PRICE NO. OF SHARES PURCHASE PRICE
Spectrum Equity Investors III, L.P. 12,416,667 $12,416,667 4,138,889 $4,138,889
XX Xxxxxx Investment Corporation 7,000,000 $7,000,000 2,333,333 $2,333,333
Sixty Wall Street SBIC Fund, L.P. 1,750,000 $1,750,000 583,333 $583,333
Crosspoint Venture Partners 8,750,000 $8,750,000 2,916,667 $2,916,667
RSI-OnSite Holdings LLC 13,125,000 $13,125,000 4,375,000 $4,375,000
Veritech Ventures LLC 3,541,667 $3,541,667 1,180,556 $1,180,556
AT&T Venture Fund II, LP 3,333,333 $3,333,333 1,111,111 $1,111,111
Xxxx Xxxx 83,333 $83,333 27,778 $27,778
TOTAL: 50,000,000 $50,000,000 16,666,667 $16,666,667
----- ---------- ----------- ---------- -----------
SERIES C PREFERRED:
TOTAL FIRST CLOSING
PURCHASER NO. OF SHARES PURCHASE PRICE NO. OF SHARES PURCHASE PRICE
Spectrum Equity Investors III, L.P. 5,930,889 $2,329,333 1,976,963 $776,444
XX Xxxxxx Investment Corporation 3,564,644 $1,400,000 1,188,215 $466,667
Sixty Wall Street SBIC Fund, L.P. 891,161 $350,000 297,054 $116,667
Crosspoint Venture Partners 4,455,806 $1,750,000 1,485,269 $583,333
RSI-OnSite Holdings LLC 6,683,708 $2,625,000 2,227,903 $875,000
Veritech Ventures LLC 1,803,540 $708,333 601,180 $236,111
AT&T Venture Fund II, LP 1,697,450 $666,667 565,817 $222,223
Xxxx Xxxx 42,436 $16,667 14,145 $5,556
TOTAL: 25,069,634 $9,846,000 8,356,546 $3,282,001
----- ---------- ---------- --------- ----------
SERIES D PREFERRED:
TOTAL FIRST CLOSING
PURCHASER NO. OF SHARES PURCHASE PRICE NO. OF SHARES PURCHASE PRICE
Spectrum Equity Investors III, L.P. 392,111 $154,000 130,704 $51,333
TOTAL: 392,111 $154,000 130,704 $51,333
----- ------- -------- ------- -------
GRAND TOTAL: 75,461,745 $60,000,000 25,153,917 $20,000,001
----------- ---------- ----------- ---------- -----------
EXHIBIT A
Certificate of Designation of
Series A, Series B, Series C and Series D Preferred Stock
EXHIBIT B
Disclosure Schedule
EXHIBIT C
Rights Agreement
EXHIBIT D
Voting Agreement
EXHIBIT E
Form of Confidentiality Agreement
ONSITE ACCESS, INC.
EMPLOYMENT, CONFIDENTIAL INFORMATION AND
INVENTION ASSIGNMENT AGREEMENT
DATED AS OF APRIL __, 1999
As a condition of my employment with OnSite Access, Inc., its subsidiaries,
affiliates, successors or assigns (together the "Company"), and in
consideration of my employment with the Company and my receipt of the
compensation now and hereafter paid to me by Company, I, _______________ agree
to the following:
1. AT-WILL EMPLOYMENT. I understand and acknowledge that my employment with
the Company is for an unspecified duration and constitutes "at-will"
employment. I acknowledge that this employment relationship may be terminated
at any time, with or without good cause or for any or no cause, at the option
either of the Company or myself.
2. CONFIDENTIAL INFORMATION.
(a) COMPANY INFORMATION. I agree at all times during the term of my
employment and thereafter, to hold in strictest confidence, and not to use,
except for the benefit of the Company, or to disclose to any person, firm or
corporation without written authorization of the Board of Directors of the
Company, any Confidential Information of the Company. I understand that
"Confidential Information" means any Company proprietary information, technical
data, trade secrets or know-how, including, but not limited to, research,
product plans, products, services, customer lists and customers (including, but
not limited to, customers of the Company on whom I called or with whom I became
acquainted during the term of my employment), markets, software, developments,
inventions, processes, formulas, technology, designs, drawings, engineering,
hardware configuration information, marketing, finances or other business
information disclosed to me by the Company either directly or indirectly in
writing, orally or by drawings or observation of parts or equipment. I further
understand that Confidential Information does not include any of the foregoing
items which has become publicly known and made generally available through no
wrongful act of mine or of others who were under confidentiality obligations as
to the item or items involved.
(b) FORMER EMPLOYER INFORMATION. I agree that I will not, during my
employment with the Company, improperly use or disclose any proprietary
information or trade secrets of any former or concurrent employer or other
person or entity and that I will not bring onto the premises of the Company any
unpublished document or proprietary information belonging to any such employer,
person or entity unless consented to in writing by such employer, person or
entity.
(c) THIRD PARTY INFORMATION. I recognize that the Company has received
and in the future will receive from third parties their confidential or
proprietary information subject to a duty on the Company's part to maintain the
confidentiality of such information and to use it only for certain limited
purposes. I agree to hold all such confidential or proprietary information in
the strictest confidence and not to disclose it to any person, firm or
corporation or to use it except as necessary in carrying out my work for the
Company consistent with the Company's agreement with such third party.
3. INVENTIONS.
(a) INVENTIONS RETAINED AND LICENSED. I have attached hereto, as Exhibit
A, a list describing all inventions, original works of authorship,
developments, improvements, and trade secrets which were made by me prior to my
employment with the Company (collectively referred to as "Prior Inventions"),
which belong to me, which relate to the Company's proposed business, products
or research and development, and which are not assigned to the Company
hereunder; or, if no such list is attached, I represent that there are no such
Prior Inventions. If in the course of my employment with the Company, I
incorporate into a Company product, process or machine a Prior Invention owned
by me or in which I have an interest, the Company is hereby granted and shall
have a nonexclusive, royalty-free, irrevocable, perpetual, worldwide license to
make, have made, modify, use and sell such Prior Invention as part of or in
connection with such product, process or machine.
(b) ASSIGNMENT OF INVENTIONS. I agree that I will promptly make full
written disclosure to the Company, will hold in trust for the sole right and
benefit of the Company, and hereby assign to the Company, or its designee, all
my right, title, and interest in and to (i) any and all inventions, original
works of authorship, developments, concepts, improvements or trade secrets,
whether or not patentable or registrable under copyright or similar laws, that
I may solely or jointly conceive or develop or reduce to practice, or cause to
be conceived or developed or reduced to practice, during the period of time I
am in the employ of the Company, and (ii) do hereby so assign any and all
proprietary information, trade secrets that underlie, are summarized, embodied
or described in, the Company's business plans prepared prior to or on the date
hereof, and all copyrights, whether or not registered, therefor, all trade
secrets and/or proprietary information and all other intellectual property
rights, no matter how described or denominated, described, contained or
reflected therein or related thereto that I have conceived, invented, created
or reduced to practice (either prior to the date hereof or at anytime during
the term of my employment) in furtherance thereof (collectively referred to as
"INVENTIONS"), except as provided in Section 3(f) below. I further acknowledge
that all original works of authorship that are made by me (solely or jointly
with others) within the scope of and during the period of my employment with
the Company and which are protectible by copyright are "works made for hire,"
as that term is defined in the United States Copyright Act.
(c) INVENTIONS ASSIGNED TO THE UNITED STATES. I agree to assign to the
United States government all my right, title, and interest in and to any and
all Inventions whenever such full title is required to be in the United States
by a contract between the Company and the United States or any of its agencies.
(d) MAINTENANCE OF RECORDS. I agree to keep and maintain adequate and
current written records of all Inventions made by me (solely or jointly with
others) during the term of my employment with the Company. The records will be
in the form of notes, sketches, drawings, and any other format that may be
specified by the Company. The records will be available to and remain the sole
property of the Company at all times.
(e) PATENT AND COPYRIGHT REGISTRATIONS. I agree to assist the Company,
or its designee, at the Company's expense, in every proper way to secure the
Company's rights in the Inventions and any copyrights, patents, mask work
rights or other intellectual property rights relating thereto in any and all
countries, including the disclosure to the Company of all pertinent information
and data with respect thereto, the execution of all applications,
specifications, oaths, assignments and all other instruments which the Company
shall deem necessary in order to apply for and obtain such rights and in order
to assign and convey to the Company, its successors, assigns, and nominees the
sole and exclusive rights, title and interest in and to such Inventions, and
any copyrights, patents, mask work rights or other intellectual property rights
relating thereto. I further agree that my obligation to execute or cause to be
executed, when it is in my power to do so, any such instrument or papers shall
continue after the termination of this Agreement. If the Company is unable to
secure my signature to apply for or to pursue any application for any United
States or foreign patents or copyright registrations covering Inventions or
original works of authorship assigned to the Company as above because of my
mental or physical incapacity or because the Company is unable to reach me
after using its good faith reasonable efforts, then I hereby irrevocably
designate and appoint the Company and its duly authorized officers and agents
as my agent and attorney in fact, to act for and in my behalf and stead to
execute and file any such applications and to do all other lawfully permitted
acts to further the prosecution and issuance of letters patent or copyright
registrations thereon with the same legal force and effect as if executed by
me.
4. CONFLICTING EMPLOYMENT. I agree that, during the term of my employment
with the Company, I will not engage in any other employment, occupation,
consulting or other business activity directly related to the business in which
the Company is now involved or becomes involved during the term of my
employment, nor will I engage in any other activities that conflict with my
obligations to the Company.
5. RETURNING COMPANY DOCUMENTS. I agree that, at the time of leaving the
employ of the Company, I will deliver to the Company (and will not keep in my
possession, recreate or deliver to anyone else) any and all devices, records,
data, notes, reports, proposals, lists, correspondence, specifications,
drawings blueprints, sketches, materials, equipment, other documents or
property, or reproductions of any aforementioned items developed by me pursuant
to my employment with the Company or otherwise belonging to the Company, its
successors or assigns. In the event of the termination of my employment, I
agree to sign and deliver the "Termination Certification" attached hereto as
Exhibit B.
6. NOTIFICATION OF NEW EMPLOYER. In the event that I leave the employ of
the Company, I hereby grant consent to notification by the Company to my new
employer about my rights and obligations under this Agreement.
7. NON-COMPETITION; SOLICITATION OF EMPLOYEES. I acknowledge and agree that
the Confidential Information is the exclusive and valuable property of the
Company and may not be used by me for any purpose of any kind, directly or
indirectly, except during the term of this Agreement for the sole and exclusive
benefit of the Company in my capacity as an employee of the Company and that
the success of the Company depends on my observance of his covenants in this
Section 7.
7.1 In consideration of the rights and benefits to be provided to me by
the Company, I agree that so long as I am an employee or consultant of the
Company and in addition for the Restrictive Period (as hereinafter defined) I
shall not directly or indirectly:
7.1.1 Engage or participate in any business or line of business that
competes with the business conducted by the Company or under consideration by
the Company while I was employed by the Company (the "Business"); or perform
any research or development or distribution or marketing services of products
that compete with the Business within the restricted Geographic Area.
7.1.2 Solicit any employee or consultant of the Company or persuade
or entice any such employee or consultant to terminate or lessen the extent of
his or its relationship with the Company.
7.1.3 Engage in any activity to interfere with, disrupt or damage
the Business of the Company or its relationships with any of its clients,
customers, distributors, suppliers, investors or other financial co-venturer or
other business relationship.
7.1.4 Engage in business with, or provide advice or services to, any
person or entity which directly or indirectly competes with the Business (or
any line of business) of the Company.
7.1.5 For the purposes of this Agreement, the term "Restrictive
Period" shall mean the term of this Agreement and an additional period of
twelve months.
7.1.6 These restrictions are limited to the geographic locations in
which the Company is doing Business at the time of my termination by the
Company, and the geographic locations in which the Company is actively planning
to do business at the time of my termination by the Company.
7.1.7 For the purposes of this Agreement, the term "Restricted
Geographic Area" shall mean any metropolitan area wherein the Company is
engaged in or actively planning to be engaged in Business as of the date of the
termination of this Agreement.
7.2 Following termination of my employment by the Company for any
reason, I shall continue to observe and be bound by his covenants under Section
7.1 for the Restrictive Period.
7.3 For purposes of this Section 7, the term "Company" shall include the
Company and its affiliates, including any entity that directly or indirectly
controls the business and affairs of the Company.
8. CONFLICT OF INTEREST GUIDELINES. I agree to diligently adhere to the
Conflict of Interest Guidelines attached as Exhibit C hereto.
9. REPRESENTATIONS. I agree to execute any proper oath or verify any proper
document required to carry out the terms of this Agreement. I represent that my
performance of all the terms of this Agreement will not breach any agreement to
keep in confidence proprietary information acquired by me in confidence or in
trust prior to my employment by the Company. I have not entered into, and I
agree I will not enter into, any oral or written agreement in conflict
herewith.
10. ARBITRATION AND EQUITABLE RELIEF.
(a) ARBITRATION. Except as provided in Section 10(b) below, I agree that
any dispute or controversy arising out of or relating to any interpretation,
construction, performance or breach of this Agreement, shall be settled by
arbitration to be held in _____________, New York, in accordance with the rules
then in effect of the American Arbitration Association. The arbitrator may
grant injunctions or other relief in such dispute or controversy. The decision
of the arbitrator shall be final, conclusive and binding on the parties to the
arbitration. Judgment may be entered on the arbitrator's decision in any court
having jurisdiction. The Company and I shall each pay one-half of the costs and
expenses of such arbitration, and each of us shall separately pay our counsel
fees and expenses.
(b) EQUITABLE REMEDIES. I agree that it would be impossible or
inadequate to measure and calculate the Company's damages from any breach of
the covenants set forth in Sections 2, 3, 5 and 7 herein. Accordingly, I agree
that if I breach any of such Sections, the Company will have available, in
addition to any other right or remedy available, the right to obtain an
injunction from a court of competent jurisdiction restraining such breach or
threatened breach and to specific performance of any such provision of this
Agreement. I further agree that no bond or other security shall be required in
obtaining such equitable relief and I hereby consent to the issuance of such
injunction and to the ordering of specific performance.
11. GENERAL PROVISIONS.
(a) GOVERNING LAW; CONSENT TO PERSONAL JURISDICTION. This Agreement will
be governed by the laws of the State of New York, without reference to choice
of laws or conflict of laws principles. I hereby expressly consent to the
personal jurisdiction of the state and federal courts located in New York for
any lawsuit filed there against me by the Company arising from or relating to
this Agreement.
(b) ENTIRE AGREEMENT. This Agreement sets forth the entire agreement and
understanding between the Company and me relating to the subject matter herein
and merges all prior discussions between us. No modification of or amendment to
this Agreement, nor any waiver of any rights under this agreement, will be
effective unless in writing signed by the party to be charged. Any subsequent
change or changes in my duties, salary or compensation will not affect the
validity or scope of this Agreement.
(c) SEVERABILITY. If any provision of this Agreement or any part hereof
or the application hereof to any person or circumstance shall be finally
determined by a court of competent jurisdiction or by any arbitration panel to
be invalid or unenforceable to any extent, the remainder of this Agreement, or
the remainder of such provision or the application of such provision to persons
or circumstances other than those as to which it has been held invalid or
unenforceable, shall not be affected thereby and each provision of this
Agreement shall remain in full force and effect to the fullest extent permitted
by law. The parties also agree that if any portion of this Agreement, or any
part hereof or application hereof, to any person or circumstance shall be
finally determined by a court of competent jurisdiction or arbitration panel to
be invalid or unenforceable to any extent, then such objectionable provision
shall be deemed modified to the extent necessary so as to make it valid,
reasonable and enforceable including, without limitation, modification of the
restrictive covenants of Section 7 with respect to geography, time or scope of
business.
(d) SUCCESSORS AND ASSIGNS. This Agreement will be binding upon my
heirs, executors, administrators and other legal representatives and will be
for the benefit of the Company, its successors, and its assigns.
IN WITNESS WHEREOF, I hereby execute this Agreement as of the date first
written above.
-----------------------------------
------------------------
Witness
EXHIBIT A
LIST OF PRIOR INVENTIONS
AND ORIGINAL WORKS OF AUTHORSHIP
Identifying Number
Title Date or Brief Description
____ No inventions or improvements
____ Additional Sheets Attached
Signature of Employee: __________________________
Print Name of Employee:
Date:
EXHIBIT C
TERMINATION CERTIFICATION
This is to certify that I do not have in my possession, nor have I failed
to return, any devices, records, data, notes, reports, proposals, lists,
correspondence, specifications, drawings, blueprints, sketches, materials,
equipment, other documents or property, or reproductions of any aforementioned
items belonging to ONSITE ACCESS INC., its subsidiaries, affiliates, successors
or assigns (together, the "Company").
I further certify that I have complied with all the terms of the Company's
Employment Confidential Information and Invention Assignment Agreement signed
by me, including the reporting of any inventions and original works of
authorship (as defined therein), conceived or made by me (solely or jointly
with others) covered by that agreement.
I further agree that, in compliance with the Employment, Confidential
Information and Invention Assignment Agreement, I will preserve as confidential
all trade secrets, confidential knowledge, data or other proprietary
information relating to products, processes, know-how, designs, formulas,
developmental or experimental work, computer programs, data bases, other
original works of authorship, customer lists, business plans, financial
information or other subject matter pertaining to any business of the Company
or any of its employees, clients, consultants or licensees.
I further agree that for twelve months from this date, I will not take
undertake any actions in violation of Section 7 of the Employment, Confidential
Information and Invention Assignment Agreement.
Date: ___________, ______
EXHIBIT C
CONFLICT OF INTEREST GUIDELINES
It is the policy of OnSite Access, Inc. to conduct its affairs in strict
compliance with the letter and spirit of the law and to adhere to the highest
principles of business ethics. Accordingly, all officers, employees and
independent contractors must avoid activities which are in conflict, or give
the appearance of being in conflict, with these principles and with the
interests of the Company. The following are potentially compromising situations
which must be avoided. Any exceptions must be reported to the Chief Executive
Officer and written approval for continuation must be obtained.
1. Revealing confidential information to outsiders or misusing confidential
information. Unauthorized divulging of information is a violation of this
policy whether or not for personal gain and whether or not harm to the Company
is intended. (The Employment, Confidential Information and Invention Assignment
Agreement elaborates on this principle and is a binding agreement.)
2. Accepting or offering substantial gifts, excessive entertainment, favors
or payments which may be deemed to constitute undue influence or otherwise be
improper or embarrassing to the Company.
3. Participating in civic or professional organizations that might involve
divulging confidential information of the Company.
4. Initiating or approving personnel actions affecting reward or punishment
of employees or applicants where there is a family relationship or is or
appears to be a personal or social involvement (other than as officers of the
Company appointed by the Board of Directors).
5. Initiating or approving any form of personal or social harassment of
employees.
6. Investing or holding outside directorship in suppliers, customers, or
competing companies, including financial speculations, where such investment or
directorship might influence in any manner a decision or course of action of
the Company.
7. Borrowing from or lending to employees, customers or suppliers.
8. Acquiring real estate of interest to the Company.
9. Improperly using or disclosing to the Company any proprietary
information or trade secrets of any former or concurrent employer or other
person or entity with whom obligations of confidentiality exist.
10. Unlawfully discussing prices, costs, customers, sales or markets with
competing companies or their employees.
11. Making any unlawful agreement with distributors with respect to prices.
12. Improperly using or authorizing the use of any inventions which are the
subject of patent claims of any other person or entity.
13. Engaging in any conduct which is not in the best interest of the
Company.
Each officer, employee and independent contractor must take every necessary
action to ensure compliance with these guidelines and to bring problem areas to
the attention of higher management for review. Violations of this conflict of
interest policy may result in discharge.
EXHIBIT F
Form of Opinion of Xxxxxxx, Xxxxxxxxx LLP, Counsel for the Successor
EXHIBIT G
Form of Opinion of Fried, Frank, Harris, Xxxxxxx & Xxxxxxxx,
Counsel for the Successor
EXHIBIT H
Form of Opinion of Mintz, Levin, Cohn, Ferris, Glovsky
and Popeo, P.C., Special Counsel for the Successor
EXHIBIT I
Board of Directors
Xxxxx X. Xxxxxxx*
Xxxx Xxxxxxx
Xxxx Xxxxxxx
Xxxx Xxxxxxx
Xxxxx Xxxx
Xxxxx Xxxxx
* So long as Xx. Xxxxxxx holds the office of President of RSI-OSA Holdings,
Inc. on the First Closing Date.
EXHIBIT J
Form of Amendment to Intercompany Agreement between the Company
and OnSite Commerce and Content LLC
TABLE OF CONTENTS
PAGE SECTION 1. THE MERGER; AUTHORIZATION AND SALE OF SERIES B, SERIES C
AND SERIES D PREFERRED STOCK. 1
1.1. The Merger. 1
1.2. Authorization. 1
1.3. Sale of Series B Preferred, Series C Preferred and Series D
Preferred. 1
SECTION 2. THE CLOSINGS. 2
2.1. The First Closing. 2
2.2. Subsequent Closings. 2
2.3. Conditions to Obligations. 3
2.4. Failure to Purchase. 3
SECTION 3. REPRESENTATIONS AND WARRANTIES OF THE COMPANY. 4
3.1. Organization and Standing; Certificate and Bylaws;
Subsidiaries. 4
3.2. Corporate Power. 5
3.3. Capitalization. 5
3.4. Authorization. 6
3.5. Financial Statements. 7
3.6. Changes. 7
3.7. Patents and Other Intangible Assets. 9
3.8. Compliance with Other Instruments, None Burdensome, Etc. 9
3.9. Litigation, Etc. 10
3.10. Employees. 10
3.11. Consent, Etc. 11
3.12. Offering. 11
3.13. Brokers or Finders. 11
3.14. Disclosure. 12
3.15. No Conflict of Interest. 12
3.16. Agreements. 12
3.17. Permits. 14
3.18. Registration Rights, Preemptive Rights and Voting Rights. 15
3.19. Title to Property and Assets. 15
3.20. Insurance. 15
3.21. Minute Books. 15
3.22. Taxes. 15
3.23. Labor Agreements and Actions. 16
3.24. Projections. 16
3.25. Environmental. 16
3.26. Confidentiality Agreements. 17
3.27. Compliance with Law. 17
3.28. Business. 17
3.29. Absence of Certain Commercial Practices. 17
3.30. Small Business Investment Act. 18
3.31. Year 2000. 18
Section 4. Representations, Warranties and Covenants of the Purchasers. 19
4.1. Representations and Warranties of the Purchasers. 19
4.2. Legends. 20
Section 5. Conditions to Closing of the Purchasers. 21
5.1. Representations and Warranties. 21
5.2. Covenants. 21
5.3. Qualifications and Consents. 21
5.4. Compliance Certificate. 21
5.5. Certificate of Designation; Corporate Proceedings. 22
5.6. Rights Agreement. 22
5.7. Opinions of Company Counsel. 22
5.8. Voting Agreement. 22
5.9. Secretary's Certificate. 22
5.10. Board of Directors. 22
5.11 February 10, 1999 Letter Agreement. 23
Section 6. Conditions to Closing of the Successor. 23
6.1. Representations. 23
6.2. Covenants. 23
6.3. Rights Agreement. 23
Section 7. Covenants of the Company and the Successor. 23
7.1. Consummation of Merger. 23
7.2. Information Rights. 23
7.3. Certain Affirmative and Negative Covenants. 24
7.4. Protective Rights. 26
7.5. Other Actions. 27
7.6. Consents. 27
7.7. Use of Proceeds. 27
7.8. Reimbursement of Directors'Expenses. 27
7.9. Confidentiality Agreements. 27
7.10. Small Business Investment Act. 27
7.11. Videoconferencing Equipment. 28
7.12. Transactions in Securities. 28
7.13. OnSite Commerce and Content LLC. 28
Section 8. Miscellaneous. 28
8.1. Governing Law. 28
8.2. Survival; Termination. 28
8.3. Successors and Assigns. 29
8.4. Entire Agreement, Amendment. 29
8.5. Notices, Etc. 29
8.6. Delays or Omissions. 30
8.7. California Corporate Securities Law. 30
8.8. Expenses. 30
8.9. Counterparts. 30
8.10. Severability. 30
8.11. Titles and Subtitles. 31
8.12. Further Assurances. 31
8.13. Specific Performance. 31
8.14. Defined Terms. 31
ATTACHMENT 1 Schedule of Purchasers
EXHIBIT A Certificate of Designation of Series A, Series B and
Series C Preferred Stock
EXHIBIT B Disclosure Schedule
EXHIBIT C Rights Agreement
EXHIBIT D Voting Agreement
EXHIBIT E Form of Confidentiality Agreement
EXHIBIT F Form of Opinion of Xxxxxxx, Xxxxxxxxx LLP, Counsel for
the Successor
EXHIBIT G Form of Opinion of Fried, Frank, Harris, Xxxxxxx & Xxxxxxxx,
Counsel for the Successor
EXHIBIT H Form of Opinion of Mintz, Levin, Cohn, Ferris, Glovsky
and Popeo, P.C., Special Counsel for the Successor
EXHIBIT I Board of Directors
EXHIBIT J Form of Amendment to Intercompany Agreement between the Company
and OnSite Commerce and Content LLC
