Exhibit 10.4
INPHONIC, INC.
SERIES C CONVERTIBLE PREFERRED STOCK PURCHASE AGREEMENT
This Series C Convertible Preferred Stock Purchase Agreement (the
"Agreement") is entered into as of October 13, 2000, by and among InPhonic,
Inc., a Delaware corporation (the "Company"), Sterling Communications, Inc., a
Maryland corporation and a wholly-owned subsidiary of the Company ("Sterling"),
and each of those persons and entities, severally and not jointly, whose names
are set forth on the Schedule of Purchasers attached hereto as Exhibit A (which
persons and entities are hereinafter collectively referred to as "Purchasers"
and each individually as a "Purchaser").
Recitals
Whereas, the Company has authorized the sale and issuance of an
aggregate of 7,870,903 shares of its Series C Convertible Preferred Stock, par
value $0.01 per share (the "Series C Stock"); and
Whereas, the Company has authorized the conversion of those certain
Convertible Bridge Notes dated as of July 21, 2000 (the "Notes") and issued
pursuant to that certain Bridge Loan Agreement, dated as of July 21, 2000, by
and among the Company and certain of the Purchasers (the "Bridge Loan
Agreement") into an aggregate of 2,082,609 shares of the Series C Stock (the
shares authorized for sale hereunder and the shares into which the Notes are
convertible, collectively, the "Shares"); and
Whereas, the Company desires to sell and issue the Shares to the
Purchasers, on the terms and conditions set forth herein, and to deliver the
Shares issuable upon the conversion of the Notes in accordance with the terms of
the Notes and the Bridge Loan Agreement; and
Whereas, the Company desires to issue warrants (the "Warrants") to
certain of the Purchasers in connection with the closing of the sale and
issuance of the Shares in accordance with the terms of the Bridge Loan
Agreement; and
Whereas, the Purchasers desire to purchase the Shares on the terms and
conditions set forth herein and to convert the Notes in accordance with the
terms and conditions set forth therein.
Now, Therefore, in consideration of the foregoing recitals and the
mutual promises, representations, warranties, and covenants hereinafter set
forth and for other good and valuable consideration, the receipt and sufficiency
of which are hereby acknowledged, the parties hereto agree as follows:
1. Agreement To Sell And Purchase.
1.1 Authorization of Shares. On or prior to the Closing (as defined
in Section 2 below), the Company shall have authorized (a) the sale and issuance
to the Purchasers of the Shares, (b) the delivery of the Shares issuable upon
conversion of the Notes, (c) the issuance of such shares of Common Stock to be
issued upon conversion of the Shares (the "Conversion Shares"), (d) the delivery
of the Warrants in accordance with the Bridge Loan
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Agreement, and (e) the delivery of the shares of Series C Stock issuable upon
the exercise of the Warrants (the "Warrant Shares"). The Shares, the Conversion
Shares and the Warrant Shares shall have the rights, preferences, privileges and
restrictions set forth in the Amended and Restated Certificate of Incorporation,
in the form attached hereto as Exhibit B (the "Certificate of Incorporation").
1.2 Sale and Purchase. Subject to the terms and conditions hereof,
the Company hereby agrees to issue and sell to each Purchaser, severally and not
jointly, and each Purchaser agrees to purchase from the Company, severally and
not jointly, the number of Shares set forth opposite such Purchaser's name on
Exhibit A, at a purchase price of $1.039401493 per share.
1.3 Conversion of Notes. Subject to the terms and conditions set
forth in the Notes and the Bridge Loan Agreement, the Company hereby agrees to
deliver to each Purchaser the number of Shares set forth opposite each such
Purchaser's name on Exhibit A.
1.4 Delivery of Warrants. Subject to the terms and conditions set
forth in the Bridge Loan Agreement, the Company hereby agrees to deliver to the
Purchasers the number of Warrants set forth opposite each such Purchaser's name
on Exhibit A.
2. Closing, Delivery And Payment.
2.1 Initial Closing. The initial closing of the sale and purchase of
the Shares, the conversion of the Notes and the delivery of the Warrants under
this Agreement (the "Initial Closing") shall take place at 10:00 a.m. on the
date hereof, at the offices of Xxxxx Xxxxxxx Xxxxxxx & Xxxxx LLP, 0000 00/xx/
Xxxxxx, X.X., Xxxxxxxxxx, XX 00000 or at such other time or place as the Company
and Purchasers may mutually agree.
2.2 Delivery. At the Initial Closing or at the Subsequent Closing
(as defined in Section 2.3), subject to the terms and conditions hereof, the
Company will (a) deliver to each Purchaser a certificate representing (i) the
number of Shares into which the Note held by such Purchaser is convertible, (ii)
the number of Shares to be purchased at the Initial Closing or the Subsequent
Closing, as applicable, by such Purchaser, against payment of the purchase price
therefor by check, wire transfer made payable to the order of the Company,
cancellation of indebtedness or any combination of the foregoing and (b) deliver
the Warrants to the Purchasers.
2.3 Subsequent Sales of Shares. At any time on or before thirty (30)
days following the Initial Closing, the Company may sell up to the balance of
the authorized shares of Series C Stock not sold at the Initial Closing to such
persons and entities as may be approved by the Board of Directors of the
Company; provided, that each Additional Investor shall be required to execute an
addendum to this Agreement substantially in the form attached hereto as Exhibit
C (the "Addendum"). All such sales shall be made on the terms and conditions set
forth in this Agreement, including, without limitation, the representations and
warranties made by such Purchasers as set forth in Section 4. All shares sold
pursuant to this Section 2.3 shall be deemed to be "Shares" for all purposes
under this Agreement and any purchasers thereof shall be deemed to be
"Purchasers" for all purposes under this Agreement. The subsequent closing of
the sale and purchase of the Shares pursuant to this Section 2.3 (the
"Subsequent Closing") shall
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take place at the offices of Xxxxx Xxxxxxx Xxxxxxx & Xxxxx LLP, 0000 00/xx/
Xxxxxx, X.X., Xxxxxxxxxx, XX 00000 or at such other place as the Company and the
Additional Investors may mutually agree.
3. Representations And Warranties Of The Company. For purposes of this
Section 3, all references to the Company shall include Sterling (other than
Sections 3.1, 3.3, 3.5, 3.16, 3.17, 3.21, 3.22, and 3.23). Except as set forth
on a Schedule of Exceptions delivered by the Company to the Purchasers at the
Initial Closing or the Subsequent Closing, as applicable, specifically
identifying the relevant Section hereof, the Company hereby represents and
warrants to each Purchaser as of the date of the Initial Closing and the
Subsequent Closing, as applicable, as follows (such representations and
warranties do not lessen or obviate the representations and warranties of each
of the Purchasers set forth in this Agreement):
3.1 Organization, Good Standing and Qualification. The Company is a
corporation duly organized, validly existing and in good standing under the laws
of the State of Delaware. The Company has all requisite corporate power and
authority to own and operate its properties and assets, to execute and deliver
this Agreement, the Amended and Restated Investor Rights Agreement in the form
attached hereto as Exhibit D (the "Investor Rights Agreement"), the Amended and
Restated Right of First Refusal and Co-Sale Agreement in the form attached
hereto as Exhibit E (the "Co-Sale Agreement"), and the Amended and Restated
Voting Agreement in the form attached hereto as Exhibit F (the "Voting
Agreement") (collectively, the "Related Agreements"), to issue and sell the
Shares and the Conversion Shares, to issue the Warrants and the Warrant Shares
and to carry out the provisions of this Agreement, the Related Agreements and
the Certificate of Incorporation and to carry on its business as presently
conducted and as presently proposed to be conducted. The Company is duly
qualified and is authorized to do business and is in good standing as a foreign
corporation in all jurisdictions in which the nature of its activities and of
its properties (both owned and leased) makes such qualification necessary,
except for those jurisdictions in which failure to do so would not have a
material adverse effect on the Company or its business.
3.2 Subsidiaries. The Company does not own or control any equity
security or other interest of any other corporation, limited partnership or
other business entity. The Company is not a participant in any joint venture,
partnership or similar arrangement.
3.3 Capitalization; Voting Rights.
(a) The authorized capital stock of the Company, immediately
prior to the Closing, will consist of 45,000,000 shares of Common Stock, par
value $0.01 per share, 19,495,924 shares of which are issued and outstanding and
2,963,908 shares of which are reserved for future issuance to employees pursuant
to the Company's 1999 Stock Incentive Plan and 10,822,369 shares of Preferred
Stock, 668,782 of which have been designated Series A Preferred Stock, 2,282,684
of which have been designated as Series B Preferred Stock and 7,870,903 of which
have been designated as Series C Preferred Stock.
(b) All issued and outstanding shares of the Company's Common
Stock and Preferred Stock (a) have been duly authorized and validly issued to
the persons listed
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on Exhibit G hereto, (b) are fully paid and nonassessable, and (c) were issued
in compliance with all applicable state and federal laws concerning the issuance
of securities.
(c) The rights, preferences, privileges and restrictions of the
Shares and the Warrant Shares are as stated in the Certificate of Incorporation.
Each series of Preferred Stock is convertible into Common Stock on a one-for-one
basis subject to Adjustment (as defined in the Certificate of Incorporation).
The Conversion Shares and the Warrant Shares have been duly and validly reserved
for issuance. Other than as set forth herein, there are no outstanding options,
warrants, rights (including conversion or preemptive rights and rights of first
refusal), proxy or shareholder agreements, or agreements of any kind for the
purchase or acquisition from the Company of any of its securities. Of the shares
of Common Stock reserved for issuance under the Company's 1999 Stock Incentive
Plan, (i) options to purchase 1,977,000 shares have been granted and are
currently outstanding, and (ii) 1,486,908 shares of Common Stock remain
available for issuance to officers, directors, employees and consultants
pursuant to such 1999 Stock Incentive Plan. When issued in compliance with the
provisions of this Agreement, the Certificate of Incorporation, the Notes and
the Warrants, as the case may be, the Shares, the Conversion Shares and the
Warrant Shares will be validly issued, fully paid and nonassessable, and will be
free of any liens or encumbrances; provided, however, that the Shares, the
Conversion Shares and the Warrant Shares may be subject to restrictions on
transfer under state and/or federal securities laws as set forth herein or as
otherwise required by such laws at the time a transfer is proposed.
(d) No stock plan, stock purchase, stock option or other
agreement or understanding between the Company and any holder of any equity
securities or rights to purchase equity securities provides for acceleration or
other changes in the vesting provisions or other terms of such agreement or
understanding as the result of any merger, consolidated sale of stock or assets,
change in control or any other transaction(s) by the Company.
3.4 Authorization; Binding Obligations. All corporate action on the
part of the Company, its officers, directors and shareholders necessary for the
authorization of this Agreement and the Related Agreements, the performance of
all obligations of the Company hereunder and thereunder at the Initial Closing
and the Subsequent Closing, as applicable, and the authorization, sale, issuance
and delivery of the Shares pursuant hereto, the issuance of the Warrant Shares
pursuant to the Warrants and the Conversion Shares pursuant to the Certificate
of Incorporation has been taken or will be taken prior to the Initial Closing
and the Subsequent Closing, as applicable. The Agreement and the Related
Agreements, when executed and delivered, will be valid and binding obligations
of the Company enforceable in accordance with their terms, except (a) as limited
by applicable bankruptcy, insolvency, reorganization, moratorium or other laws
of general application affecting enforcement of creditors' rights, (b) general
principles of equity that restrict the availability of equitable remedies, and
(c) to the extent that the enforceability of the indemnification provisions in
Section 2.9 of the Investor Rights Agreement may be limited by applicable laws.
The sale and issuance of the Shares, the subsequent conversion of the Shares
into Conversion Shares, and the issuance of the Warrant Shares are not and will
not be subject to any preemptive rights or rights of first refusal that have not
been properly waived or complied with.
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3.5 Financial Statements. The Company has made available to each
Purchaser its unaudited balance sheet as at December 31, 1999 (the "Statement
Date"), its unaudited consolidated statement of income and cash flows for the
twelve month period ending on the Statement Date and its unaudited balance
sheet, and consolidated statement of income and cash flows for the eight month
period ending on August 31, 2000 (collectively, the "Financial Statements"). The
Financial Statements, together with the notes thereto, are complete and correct
in all material respects, have been prepared in accordance with generally
accepted accounting principles applied on a consistent basis throughout the
periods indicated, except as disclosed therein, and present fairly the financial
condition and position of the Company as of the Statement Date; provided,
however, that the unaudited Financial Statements are subject to normal recurring
year-end audit adjustments (which are not expected to be material), and do not
contain all footnotes required under generally accepted accounting principles.
3.6 Liabilities. The Company has no material liabilities and, to the
best of its knowledge, knows of no material contingent liabilities not disclosed
in the Financial Statements, except current liabilities incurred in the ordinary
course of business subsequent to the Statement Date which have not been, either
in any individual case or in the aggregate, materially adverse.
3.7 Agreements; Action.
(a) There are no agreements, understandings or proposed
transactions between the Company and any of its officers, directors, affiliates
or any affiliate thereof.
(b) There are no agreements (other than partnership contracts),
understandings, instruments, contracts, proposed transactions, judgments,
orders, writs or decrees to which the Company is a party or to its knowledge by
which it is bound which may involve (i) obligations (contingent or otherwise)
of, or payments to, the Company in excess of $50,000 (other than obligations of,
or payments to, the Company arising from agreements entered into in the ordinary
course of business), or (ii) the transfer or license of any patent, copyright,
trade secret or other proprietary right to or from the Company (other than
licenses arising from the purchase of "off the shelf" or other standard products
or in connection with agreements entered into in the ordinary course of
business), or (iii) provisions restricting the development, manufacture or
distribution of the Company's products or services (other than provisions
contained within agreements entered into in the ordinary course of business), or
(iv) indemnification by the Company with respect to infringements of proprietary
rights (other than indemnification obligations arising from agreements entered
into in the ordinary course of business).
(c) The Company has not (i) declared or paid any dividends, or
authorized or made any distribution upon or with respect to any class or series
of its capital stock, (ii) incurred any indebtedness for money borrowed or any
other liabilities (other than with respect to dividend obligations,
distributions, indebtedness and other obligations incurred in the ordinary
course of business or as disclosed in the Financial Statements) individually in
excess of $50,000 or, in the case of indebtedness and/or liabilities
individually less than $50,000 or in excess of $125,000 in the aggregate, (iii)
made any loans or advances to any person, other than ordinary advances for
travel expenses, or (iv) sold, exchanged or otherwise disposed of any of its
assets or rights, other than the sale of its inventory in the ordinary course of
business.
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(d) For the purposes of subsections (b) and (c) above, all
indebtedness, liabilities, agreements, understandings, instruments, contracts
and proposed transactions involving the same person or entity (including persons
or entities the Company has reason to believe are affiliated therewith) shall be
aggregated for the purpose of meeting the individual minimum dollar amounts of
such subsections.
(e) The Company has not engaged in the past three (3) months in
any discussion (i) with any representative of any corporation or corporations
regarding the consolidation or merger of the Company with or into any such
corporation or corporations, (ii) with any corporation, partnership, association
or other business entity or any individual regarding the sale, conveyance or
disposition of all or substantially all of the assets of the Company, or a
transaction or series of related transactions in which more than fifty percent
(50%) of the voting power of the Company is disposed of, or (iii) regarding any
other form of acquisition, liquidation, dissolution or winding up, of the
Company.
3.8 Obligations to Related Parties. There are no obligations of the
Company to officers, directors, shareholders, or employees of the Company other
than (a) for payment of salary for services rendered, (b) reimbursement for
reasonable expenses incurred on behalf of the Company and (c) for other standard
employee benefits made generally available to all employees (including stock
option agreements outstanding under any stock option plan approved by the Board
of Directors of the Company). None of the officers, directors or shareholders of
the Company, or any members of their immediate families, are indebted to the
Company or have any direct or indirect ownership interest in any firm or
corporation with which the Company is affiliated or with which the Company has a
business relationship, or any firm or corporation which competes with the
Company, except that officers, directors and/or shareholders of the Company may
own stock in publicly traded companies which may compete with the Company. No
officer, director or shareholder, or any member of their immediate families, is,
directly or indirectly, interested in any material contract with the Company
(other than such contracts as relate to any such person's ownership of capital
stock or other securities of the Company). Except as may be disclosed in the
Financial Statements, the Company is not a guarantor or indemnitor of any
indebtedness of any other person, firm or corporation.
3.9 Changes. Since the Statement Date, there has not been to the
Company's knowledge:
(a) Any change in the assets, liabilities, financial condition or
operations of the Company from that reflected in the Financial Statements, other
than changes in the ordinary course of business, none of which individually or
in the aggregate has had or is expected to have a material adverse effect on
such assets, liabilities, financial condition, operations or prospects of the
Company;
(b) Any resignation or termination of any officer or key employee
of the Company; and the Company, to the best of its knowledge, does not know of
the impending resignation or termination of employment of any such officer or
key employee;
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(c) Any material change, except in the ordinary course of
business, in the contingent obligations of the Company by way of guaranty,
endorsement, indemnity, warranty or otherwise;
(d) Any damage, destruction or loss, whether or not covered by
insurance, materially and adversely affecting the properties, business or
prospects or financial condition of the Company;
(e) Any waiver by the Company of a valuable right or of a material
debt owed to it;
(f) Any direct or indirect loans made by the Company to any
shareholder, employee, officer or director of the Company, other than advances
made in the ordinary course of business;
(g) Any material change in any compensation arrangement or
agreement with any employee, officer, director or shareholder;
(h) Any declaration or payment of any dividend or other
distribution of the assets of the Company;
(i) Any labor organization activity;
(j) Any debt, obligation or liability incurred, assumed or
guaranteed by the Company, except those for immaterial amounts and for current
liabilities incurred in the ordinary course of business;
(k) Any sale, assignment or transfer of any patents, trademarks,
copyrights, trade secrets or other intangible assets;
(l) Any change in any material agreement to which the Company is a
party or by which it is bound which materially and adversely affects the
business, assets, liabilities, financial condition, operations or prospects of
the Company;
(m) Any other event or condition of any character that, either
individually or cumulatively, has materially and adversely affected the
business, assets, liabilities, financial condition, operations or prospects of
the Company; or
(n) Any arrangement or commitment by the Company to do any of the
acts described in subsection (a) through (m) above.
3.10 Title to Properties and Assets; Liens, Etc. The Company has good
and marketable title to its properties and assets, including the properties and
assets reflected in the most recent balance sheet included in the Financial
Statements, and good title to its leasehold estates, in each case subject to no
mortgage, pledge, lien, lease, encumbrance or charge, other than (a) those
resulting from taxes which have not yet become delinquent, (b) minor liens and
encumbrances which do not materially detract from the value of the property
subject thereto or materially impair the operations of the Company, and (c)
those that have otherwise arisen in the
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ordinary course of business. All facilities, machinery, equipment, fixtures,
vehicles and other properties owned, leased or used by the Company are in good
operating condition and repair and are reasonably fit and usable for the
purposes for which they are being used. The Company is in compliance with all
material terms of each lease to which it is a party or is otherwise bound.
3.11 Patents and Trademarks.
(a) The Company owns or possesses sufficient legal rights to all
patents, trademarks, service marks, trade names, copyrights, trade secrets,
licenses, information and other proprietary rights and processes necessary for
its business as now conducted and as presently proposed to be conducted, without
any known infringement of the rights of others. There are no outstanding
options, licenses or agreements of any kind relating to the foregoing, nor is
the Company 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 and other proprietary rights
and processes of any other person or entity other than such licenses or
agreements arising from the purchase of "off the shelf" or standard products,
and those arising in the ordinary course of business.
(b) The Company is not aware of any allegations that the Company
has violated or, by conducting its business as presently 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.
(c) The Company is not aware that any of its 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 their duties to
the Company or that would conflict with the Company's business as presently
proposed to be conducted. Neither the execution nor delivery of this Agreement
or the Related Agreements, nor the carrying on of the Company's business by the
employees of the Company, nor the conduct of the Company's business as presently
proposed, will, to the Company's knowledge, 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 any employee is now obligated. The
Company does not believe it is or will be necessary to utilize any inventions,
trade secrets or proprietary information of any of its employees made prior to
their employment by the Company, except for inventions, trade secrets or
proprietary information that have been assigned to the Company.
(d) The Company is not aware of any claims by any other person or
entity contesting the validity, enforceability, use or ownership of any of the
patents, trademarks, service marks, trade names, copyrights, trade secrets,
licenses, information and other proprietary rights and processes necessary for
its business as now conducted and as presently proposed to be conducted. The
Company is not aware of any infringement or misappropriation by any other person
or entity with respect to any of the patents, trademarks, service marks, trade
names, copyrights, trade secrets, licenses, information and other proprietary
rights and processes necessary for its business as now conducted and as
presently proposed to be conducted.
3.12 Compliance with Other Instruments.
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(a) The Company is not in violation or default of any term of its
Certificate of Incorporation or Bylaws, or of any material term of any mortgage,
indenture, contract, agreement, instrument or contract to which it is party or
by which it is bound or of any judgment, decree, order, or writ. The execution,
delivery, and performance of and compliance with this Agreement, and the Related
Agreements, and the issuance and sale of the Shares pursuant hereto, of the
Conversion Shares pursuant to the Certificate of Incorporation and the issuance
of the Warrant Shares pursuant to the Warrants, will not, with or without the
passage of time or giving of notice, result in any such material violation, or
be in conflict with or constitute a default under any such material term, or
result in the creation of any mortgage, pledge, lien, encumbrance or charge upon
any of the properties or assets of the Company or the suspension, revocation,
impairment, forfeiture or nonrenewal of any permit, license, authorization or
approval applicable to the Company, its business or operations or any of its
assets or properties.
(b) The Company has avoided every condition, and has not performed
any act, the occurrence of which would result in the Company's loss of any right
granted under any license, distribution agreement or other agreement to which
the Company is a party if such loss would have a material adverse effect on the
assets, condition, affairs, or prospects of the Company, financially or
otherwise.
3.13 Litigation. There is no action, suit, proceeding or investigation
pending or to the Company's knowledge currently threatened against the Company
or its officers that questions the validity of this Agreement, or the Related
Agreements or the right of the Company to enter into any of such agreements, or
to consummate the transactions contemplated hereby or thereby, or which might
result, either individually or in the aggregate, in any material adverse change
in the assets, condition, affairs or prospects of the Company, financially or
otherwise, or any change in the current equity ownership of the Company nor is
the Company aware that there is any basis for any of the foregoing. The
foregoing includes, without limitation, actions pending or threatened (or any
basis therefor known to the Company) involving the prior employment of any of
the Company's employees, their use in connection with the Company's business of
any information or techniques allegedly proprietary to any of their former
employers, or their obligations under any agreements with prior employers. The
Company is not 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 by the
Company currently pending or which the Company intends to initiate.
3.14 Tax Returns and Payments. The Company has timely filed all tax
returns (federal, state and local) required to be filed by it. All taxes shown
to be due and payable on such returns, any assessments imposed, and to the
Company's knowledge all other taxes due and payable by the Company on or before
the Initial Closing and the Subsequent Closing, as applicable, have been paid or
will be paid prior to the time they become delinquent. The Company has not been
advised (a) that any of its returns, federal, state or other, have been or are
being audited as of the date hereof, or (b) of any deficiency in assessment or
proposed judgment to its federal, state or other taxes. The Company has no
knowledge of any liability for any tax to be imposed upon its properties or
assets as of the date of this Agreement that is not adequately provided for.
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3.15 Employees. The Company has no collective bargaining agreements with
any of its employees. There is no labor union organizing activity pending or, to
the Company's knowledge, threatened with respect to the Company. The Company is
not a party to or bound by any currently effective employment contract, deferred
compensation arrangement, bonus plan, incentive plan, profit sharing plan,
retirement agreement or other employee compensation plan or agreement. To the
Company's knowledge, no employee of the Company, nor any consultant with whom
the Company has contracted, is in violation of any term of any employment
contract, proprietary information agreement or any other agreement relating to
the right of any such individual to be employed by, or to contract with, the
Company because of the nature of the business to be conducted by the Company;
and to the Company's knowledge the continued employment by the Company of its
present employees, and the performance of the Company's contracts with its
independent contractors, will not result in any such violation. The Company has
not received any notice alleging that any such violation has occurred. No
employee of the Company has been granted the right to continued employment by
the Company or to any material compensation following termination of employment
with the Company. The Company is not aware that any officer or key employee, or
that any group of key employees, intends to terminate his, her or their
employment with the Company, nor does the Company have a present intention to
terminate the employment of any officer, key employee or group of key employees.
3.16 Assignment of Inventions, Non-Disclosure and Non-Competition
Agreements. Each former and current employee, officer and consultant of the
Company has executed an Assignment of Inventions, Non-Disclosure and
Non-Competition Agreement in the form of Exhibit H attached hereto. No current
employee, officer or consultant of the Company has excluded works or inventions
made prior to his or her employment with the Company from his or her assignment
of inventions pursuant to such employee, officer or consultant's Assignment of
Inventions, Non-Disclosure and Non-Competition Agreement.
3.17 Obligations of Management. Each officer of the Company is currently
devoting one hundred percent (100%) of his or her business time to the conduct
of the business of the Company. The Company is not aware that any officer or key
employee of the Company is planning to work less than full time at the Company
in the future. No officer or key employee is currently working or, to the
Company's knowledge, plans to work for a competitive enterprise, whether or not
such officer or key employee is or will be compensated by such enterprise.
3.18 Registration Rights and Voting Rights.
(a) Except as required pursuant to the Investor Rights Agreement,
the Company is presently not under any obligation, and has not granted any
rights, to register (as defined in Section 1.1 of the Investor Rights Agreement)
any of the Company's presently outstanding securities or any of its securities
that may hereafter be issued.
(b) To the Company's knowledge, except as contemplated in the
Voting Agreement, no shareholder of the Company has entered into any agreement
with respect to the voting of equity securities of the Company.
3.19 Compliance with Laws; Permits. The Company is not in violation of
any applicable statute, rule, regulation, order or restriction of any domestic
or foreign
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government or any instrumentality or agency thereof in respect of the conduct of
its business or the ownership of its properties which violation would materially
and adversely affect the business, assets, liabilities, financial condition,
operations or prospects of the Company. No governmental orders, permissions,
consents, approvals or authorizations are required to be obtained and no
registrations or declarations are required to be filed in connection with the
execution and delivery of this Agreement and the issuance of the Shares, the
Conversion Shares, or the Warrant Shares, except such as has been duly and
validly obtained or filed, or with respect to any filings that must be made
after the Initial Closing and the Subsequent Closing, as applicable, as will be
filed in a timely manner. The Company has all franchises, permits, licenses and
any similar authority necessary for the conduct of its business as now being
conducted by it, the lack of which could materially and adversely affect the
business, properties, prospects or financial condition of the Company and
believes it can obtain, without undue burden or expense, any similar authority
for the conduct of its business as planned to be conducted.
3.20 Environmental and Safety Laws. To the Company's knowledge, the
Company is not in violation of any applicable statute, law or regulation
relating to the environment or occupational health and safety, and to its
knowledge, no material expenditures are or will be required in order to comply
with any such existing statute, law or regulation. No Hazardous Materials (as
defined below) are used or have been used, stored, or disposed of by the Company
or, to the Company's knowledge, after reasonable investigation, by any other
person or entity on any property owned, leased or used by the Company. For the
purposes of the preceding sentence, "Hazardous Materials" shall mean (a)
materials which are listed or otherwise defined as "hazardous" or "toxic" under
any applicable local, state, federal and/or foreign laws and regulations that
govern the existence and/or remedy of contamination on property, the protection
of the environment from contamination, the control of hazardous wastes, or other
activities involving hazardous substances, including building materials, or (b)
any petroleum products or nuclear materials.
3.21 Offering Valid. Assuming the accuracy of the representations and
warranties of the Purchasers contained in Section 4.2 hereof, the offer, sale
and issuance of the Shares, the Conversion Shares and the Warrant Shares will be
exempt from the registration requirements of the Securities Act of 1933, as
amended (the "Securities Act"), and will have been registered or qualified (or
are exempt from registration and qualification) under the registration, permit
or qualification requirements of all applicable state securities laws. Neither
the Company nor any agent on its behalf has solicited or will solicit any offers
to sell or has offered to sell or will offer to sell all or any part of the
Shares to any person or persons so as to bring the sale of such Shares by the
Company within the registration provisions of the Securities Act or any state
securities laws.
3.22 Full Disclosure. The Company has provided the Purchasers with all
information requested by the Purchasers in connection with their decision to
purchase the Shares and to the Company's knowledge, including all information
the Company believes is reasonably necessary to make such investment decision.
Neither this Agreement, the Exhibits hereto, the Related Agreements nor any
other document delivered by the Company to Purchasers or their attorneys or
agents in connection herewith or therewith or with the transactions contemplated
hereby or thereby, contain any untrue statement of a material fact nor, omit to
state a material
-11-
fact necessary in order to make the statements contained herein or therein not
misleading. To the Company's knowledge, there are no facts which (individually
or in the aggregate) materially adversely affect the business, assets,
liabilities, financial condition, prospects or operations of the Company that
have not been set forth in the Agreement, the Exhibits hereto, the Related
Agreements or in other documents delivered to Purchasers or their attorneys or
agents in connection herewith.
3.23 Minute Books. The minute books of the Company made available to
the Purchasers contain a complete summary of all formal meetings of the
directors and the shareholders of the Company since the time of incorporation.
3.24 Real Property Holding Corporation. The Company is not a real
property holding corporation within the meaning of Section 897(c)(2) of the
Internal Revenue Code of 1986, as amended (the "Code") and any regulations
promulgated thereunder.
3.25 Insurance. The Company has general business liability, fire and
casualty insurance policies with coverage customary for companies similarly
situated to the Company.
3.26 Tax Elections. The Company has not elected to be treated as an
"S" corporation or a collapsible corporation pursuant to Section 341(f) or
Section 1362(a) of the Code, nor has it made any other elections pursuant to the
Code (other than elections which relate solely to matters of accounting,
depreciation or amortization) which would have a material adverse effect on the
Company, its financial condition, its business as presently conducted or its
present properties or material assets.
3.27 Year 2000 Compatibility. All of the Company's proprietary
software has been designed and tested for use before, during and after January
1, 2000, and will, when used in accordance with its documentation, operate
(i.e., receive, record, store, process, calculate, manipulate and output dates)
during such period without error or ambiguity relating to calendar date data,
including, without limitation, any error relating to or resulting from calendar
date data that represent or references different centuries or more than one
century or leap years; provided, however, that the foregoing warranty shall not
apply to the extent that any failure properly to so operate arises from the
operation of non-proprietary software, the incorrect operation of or ambiguous
input of data to non-proprietary software or the incorrect or ambiguous input of
data to the Company's proprietary software.
4. Representations And Warranties Of The Purchasers. Each Purchaser hereby
represents and warrants to the Company, severally and not jointly, as follows
(such representations and warranties do not lessen or obviate the
representations and warranties of the Company set forth in this Agreement):
4.1 Requisite Power and Authority. Purchaser has all necessary power
and authority under all applicable provisions of law to execute and deliver this
Agreement and the Related Agreements and to carry out their provisions. All
action on Purchaser's part required for the lawful execution and delivery of
this Agreement and the Related Agreements have been or will be effectively taken
prior to the Initial Closing or the Subsequent Closing, as applicable. Upon
their execution and delivery, this Agreement and the Related Agreements will be
valid and
-12-
binding obligations of Purchaser, enforceable in accordance with their terms,
except (a) as limited by applicable bankruptcy, insolvency, reorganization,
moratorium or other laws of general application affecting enforcement of
creditors' rights, (b) general principles of equity that restrict the
availability of equitable remedies, and (c) to the extent that the
enforceability of the indemnification provisions of Section 2.9 of the Investor
Rights Agreement may be limited by applicable laws.
4.2 Investment Representations. Purchaser understands that neither
the Shares nor the Conversion Shares nor the Warrant Shares have been registered
under the Securities Act. Purchaser also understands that the Shares are being
offered and sold pursuant to an exemption from registration contained in the
Securities Act based in part upon Purchaser's representations contained in the
Agreement. Purchaser hereby represents and warrants as follows:
(a) Purchaser Bears Economic Risk. Purchaser has substantial
experience in evaluating and investing in private placement transactions of
securities in companies similar to the Company so that it is capable of
evaluating the merits and risks of its investment in the Company and has the
capacity to protect its own interests. Purchaser must bear the economic risk of
this investment indefinitely unless the Shares, the Conversion Shares, or the
Warrant Shares are registered pursuant to the Securities Act, or an exemption
from registration is available. Purchaser understands that the Company has no
present intention of registering the Shares, the Conversion Shares, the Warrant
Shares or any shares of its Common Stock. Purchaser also understands that there
is no assurance that any exemption from registration under the Securities Act
will be available and that, even if available, such exemption may not allow
Purchaser to transfer all or any portion of the Shares, the Conversion Shares,
or the Warrant Shares under the circumstances, in the amounts or at the times
Purchaser might propose.
(b) Acquisition for Own Account. Purchaser is acquiring the
Shares, the Conversion Shares, and the Warrant Shares for Purchaser's own
account for investment only, and not with a view towards their distribution.
(c) Purchaser Can Protect Its Interest. Purchaser represents that
by reason of its, or of its management's, business or financial experience,
Purchaser has the capacity to protect its own interests in connection with the
transactions contemplated in this Agreement, and the Related Agreements.
Further, Purchaser is aware of no publication of any advertisement in connection
with the transactions contemplated in the Agreement.
(d) Accredited Investor. Purchaser represents that it is an
accredited investor within the meaning of Regulation D under the Securities Act.
(e) Company Information. Purchaser has received and read the
Financial Statements and Business Plan and has had an opportunity to discuss the
Company's business, management and financial affairs with directors, officers
and management of the Company and has had the opportunity to review the
Company's operations and facilities. Purchaser has also had the opportunity to
ask questions of and receive answers from, the Company and its management
regarding the terms and conditions of this investment.
-13-
(f) Rule 144. Purchaser acknowledges and agrees that the Shares,
and, if issued, the Conversion Shares, and, if issued, the Warrant Shares must
be held indefinitely unless they are subsequently registered under the
Securities Act or an exemption from such registration is available. Purchaser
has been advised or is aware of the provisions of Rule 144 promulgated under the
Securities Act as in effect from time to time, which permits limited resale of
shares purchased in a private placement subject to the satisfaction of certain
conditions, including, among other things: the availability of certain current
public information about the Company, the resale occurring following the
required holding period under Rule 144 and the number of shares being sold
during any three-month period not exceeding specified limitations.
(g) Residence. If the Purchaser is an individual, then the
Purchaser resides in the state or province identified in the address of the
Purchaser set forth on Exhibit A; if the Purchaser is a partnership,
corporation, limited liability company or other entity, then the office or
offices of the Purchaser in which its investment decision was made is located at
the address or addresses of the Purchaser set forth on Exhibit A.
4.3 Transfer Restrictions. Each Purchaser acknowledges and agrees
that the Shares and, if issued, the Conversion Shares, and, if issued, the
Warrant Shares are subject to restrictions on transfer as set forth in the
Investor Rights Agreement.
5. Conditions To Closing.
5.1 Conditions to Purchasers' Obligations at the Closing. Each of the
Purchasers' obligations to purchase the Shares at the Initial Closing or the
Subsequent Closing, as applicable, are subject to the satisfaction, at or prior
to such date, of the following conditions:
(a) Representations and Warranties True; Performance of
Obligations. The representations and warranties made by the Company in Section 3
hereof shall be true and correct as of the Initial Closing or the Subsequent
Closing, as applicable, with the same force and effect as if they had been made
as of such date and the Company shall have performed all obligations and
conditions herein required to be performed or observed by it on or prior to such
date; provided, however, the Company shall provide an updated Schedule of
Exceptions to the representations and warranties made by the Company in Section
3 hereof at the Subsequent Closing.
(b) Consents, Permits, and Waivers. The Company shall have
obtained any and all consents, permits and waivers necessary or appropriate for
consummation of the transactions contemplated by the Agreement and the Related
Agreements (except for such as may be properly obtained subsequent to the
Initial Closing or the Subsequent Closing, as applicable).
(c) Filing of Certificate of Incorporation. The Certificate of
Incorporation shall have been filed with the Secretary of State of the State of
Delaware and shall continue to be in full force and effect as of the Initial
Closing or the Subsequent Closing, as applicable.
-14-
(d) Corporate Documents. The Company shall have delivered to
Purchasers or their counsel, copies of all corporate documents of the Company as
Purchasers shall reasonably request.
(e) Reservation of Conversion Shares and Warrant Shares. The
Conversion Shares issuable upon conversion of the Shares and the Warrant Shares
issuable upon exercise of the Warrants shall have been duly authorized and
reserved for issuance upon such conversion or exercise, as the case may be.
(f) Compliance Certificate. The Company shall have delivered to
the Purchasers a Compliance Certificate, executed by the President of the
Company, dated the Initial Closing, to the effect that the conditions specified
in subsections (a), (b), (c) and (e) of this Section 5.1 have been satisfied.
(g) Investor Rights Agreement. The Investor Rights Agreement
shall have been executed and delivered by the parties thereto. The stock
certificates representing the shares subject to the Investor Rights Agreement
shall have been delivered to the Secretary of the Company and shall have had
appropriate legends placed upon them to reflect the restrictions on transfer set
forth in the Investor Rights Agreement.
(h) Right of First Refusal and Co-Sale Agreement. The Co-Sale
Agreement shall have been executed and delivered by the parties thereto. The
stock certificates representing the shares subject to the Co-Sale Agreement
shall have been delivered to the Secretary of the Company and shall have had
appropriate legends placed upon them to reflect the restrictions on transfer set
forth in the Co-Sale Agreement.
(i) Voting Agreement. The Voting Agreement shall have been
executed and delivered by the parties thereto. The stock certificates
representing the shares subject to the Voting Agreement shall have been
delivered to the Secretary of the Company and shall have had appropriate legends
placed upon them to reflect the restrictions on transfer set forth in the Voting
Agreement.
(j) Employment Agreement. The Employment Agreement by and between
the Company and Xxxxx X. Xxxxxxxxx dated as of February 4, 2000 shall remain in
full force and effect.
(k) Stock Restriction Agreement. The Stock Restriction Agreement
by and between the Company and Xxxxx X. Xxxxxxxxx dated as of February 4, 2000
shall remain in full force and effect.
(l) Board of Directors. Upon the Initial Closing, the authorized
size of the Board of Directors of the Company shall be seven (7) members and the
Board shall consist of, Xxxxxx X. Xxxxx, Xxxxx X. Xxxxxxxxx, Xxxx Xxxxxxx,
Xxxxxx Xxxxxxxx, Sr., Xxxx X. XxXxxxx, Xxxxxx X. Xxxxxxx and one (1) individual
to be designated after the date hereof pursuant to the Voting Agreement.
-15-
(m) Legal Opinion. The Purchasers shall have received from legal
counsel to the Company an opinion addressed to them, dated as of the Initial
Closing, in substantially the form attached hereto as Exhibit I.
(n) Proceedings and Documents. All corporate and other proceedings
in connection with the transactions contemplated hereby and all documents and
instruments incident to such transactions shall be reasonably satisfactory in
substance and form to the Purchasers and their special counsel, and the
Purchasers and their special counsel shall have received all such counterpart
originals or certified or other copies of such documents as they may reasonably
request. Such documents shall include (but not be limited to) the following:
(1) Certified Charter Documents. A copy of the
Company's Certificate of Incorporation (certified by the Delaware Secretary of
State) and Bylaws, as amended, certified by the Secretary of the Company as true
and correct as of each Closing.
(2) Secretary's Incumbency Certificate. A certificate
of the Secretary or an Assistant Secretary or other officer of the Company
certifying the names of the officers of the Company authorized to sign this
Agreement and the other documents, instruments or certificates to be delivered
pursuant to this Agreement by the Company or any of its officers, together with
the true signatures of such officers.
(3) Corporate Actions. A copy of the resolutions of
the Board of Directors and, if required, the stockholders of the Company
evidencing the approval of this Agreement and the Related Agreements, the
election of the Board of Directors and the other matters contemplated hereby,
certified by the Secretary of the Company to be true, complete and correct.
(4) Good Standing Certificate. A good standing
certificate issued by the Delaware Secretary of State and any other state where
the Company is qualified to do business dated within fifteen (15) days prior to
the Initial Closing.
(o) Assignment of Inventions, Non-Disclosure and Non-Competition
Agreement. The Company and each of its former senior management and current
employees, senior management, officers and consultants, shall have entered into
the Assignment of Inventions, Non-Disclosure and Non-Competition Agreement.
(p) Fulfillment Agreement. The Fulfillment Agreement shall remain in
full force and effect.
(q) Due Diligence. The Purchasers shall have completed, to their
sole satisfaction, their due diligence review of the Company.
5.2 Conditions to Obligations of the Company. The Company's obligation to
issue and sell the Shares at the Initial Closing or the Subsequent Closing, as
applicable, to each Purchaser is subject to the satisfaction, on or prior to
such Closing, of the following
-16-
conditions provided however, the Company shall provide an updated Schedule of
Exceptions to the representations and warranties made by the Company in Section
3 hereof at the Subsequent Closing:
(a) Representations and Warranties True. The representations and
warranties in Section 4 made by such Purchaser shall be true and correct at the
date of the Initial Closing or the Subsequent Closing, as applicable, with the
same force and effect as if they had been made on and as of said date.
(b) Performance of Obligations. Such Purchaser shall have
performed and complied with all agreements and conditions herein required to be
performed or complied with by such Purchaser on or before the Initial Closing or
the Subsequent Closing, as applicable.
(c) Filing of Certificate of Incorporation. The Certificate of
Incorporation shall have been filed with the Secretary of State of the State of
Delaware.
(d) Investor Rights Agreement. The Investor Rights Agreement
shall have been executed and delivered by such Purchaser.
(e) Co-Sale Agreement. The Co-Sale Agreement shall have been
executed and delivered by such Purchaser.
(f) Voting Agreement. The Voting Agreement shall have been
executed and delivered by such Purchaser.
(g) Consents, Permits, and Waivers. The Company shall have
obtained any and all consents, permits and waivers necessary or appropriate for
consummation of the transactions contemplated by the Agreement and the Related
Agreements (except for such as may be properly obtained subsequent to the
Initial Closing or the Subsequent Closing, as applicable).
6. Miscellaneous.
6.1 Governing Law. This Agreement shall be construed under Delaware
General Corporation Law as to matters of corporate law and, as to all other
matters of law, shall be governed and construed under the laws of the State of
Maryland as such laws are applied to agreements between Maryland residents
entered into and performed entirely in Maryland.
6.2 Survival. The representations, warranties, covenants and
agreements made herein shall survive any investigation made by any Purchaser and
the closing of the transactions contemplated hereby. All statements as to
factual matters contained in any certificate or other instrument delivered by or
on behalf of the Company pursuant hereto in connection with the transactions
contemplated hereby shall be deemed to be representations and warranties by the
Company hereunder solely as of the date of such certificate or instrument.
6.3 Successors and Assigns. Except as otherwise expressly provided
herein, the provisions hereof shall inure to the benefit of, and be binding
upon, the successors, assigns,
-17-
heirs, executors and administrators of the parties hereto and shall inure to the
benefit of and be enforceable by each person who shall be a holder of the Shares
from time to time.
6.4 Entire Agreement. This Agreement, the Exhibits and Schedules
hereto, the Related Agreements and the other documents delivered pursuant hereto
constitute the full and entire understanding and agreement between the parties
with regard to the subject matter hereof and no party shall be liable or bound
to any other in any manner by any representations, warranties, covenants and
agreements except as specifically set forth herein and therein.
6.5 Severability. In case any provision of the Agreement shall be
invalid, illegal or unenforceable, the validity, legality and enforceability of
the remaining provisions shall not in any way be affected or impaired thereby.
6.6 Amendment and Waiver.
(a) This Agreement may be amended or modified only by the
written consent of the Company and holders of at least fifty-one percent (51%)
of the Shares (treated as if converted and including any Conversion Shares into
which the Shares have been converted that have not been sold to the public).
(b) The obligations of the Company and the rights of the
holders of the Shares and the Conversion Shares under the Agreement may be
waived only with the written consent of the holders of at least fifty-one
percent (51%) of the Shares (treated as if converted and including any
Conversion Shares into which the Shares have been converted that have not been
sold to the public).
(c) The sale of Shares pursuant to Section 2.3 and the
execution and delivery of the Addendum shall not be deemed an amendment or
modification to this Agreement.
6.7 Delays or Omissions. It is agreed that no delay or omission to
exercise any right, power or remedy accruing to any party, upon any breach,
default or noncompliance by another party under this Agreement, the Related
Agreements or the Certificate of Incorporation, shall impair any such right,
power or remedy, nor shall it be construed to be a waiver of any such breach,
default or noncompliance, or any acquiescence therein, or of or in any similar
breach, default or noncompliance thereafter occurring. It is further agreed that
any waiver, permit, consent or approval of any kind or character on any
Purchaser's part of any breach, default or noncompliance under this Agreement,
the Related Agreements or under the Certificate of Incorporation or any waiver
on such party's part of any provisions or conditions of the Agreement, the
Related Agreements, or the Certificate of Incorporation must be in writing and
shall be effective only to the extent specifically set forth in such writing.
All remedies, either under this Agreement, the Related Agreements, the
Certificate of Incorporation, the Bylaws, or otherwise afforded to any party,
shall be cumulative and not alternative.
6.8 Notices. All notices required or permitted hereunder shall be in
writing and shall be deemed effectively given: (a) upon personal delivery to the
party to be notified, (b) when sent by confirmed telex or facsimile if sent
during normal business hours of the recipient, if not, then on the next business
day, (c) five (5) days after having been sent by registered or certified mail,
return receipt requested, postage prepaid, or (d) one (1) day after deposit with
a
-18-
nationally recognized overnight courier, specifying next day delivery, with
written verification of receipt. All communications shall be sent to the Company
at the address as set forth on the signature page hereof and to a Purchaser at
the address set forth on Exhibit A attached hereto or at such other address as
the Company or such Purchaser may designate by ten (10) days advance written
notice to the other parties hereto.
6.9 Expenses. The Company shall pay all costs and expenses that it
incurs with respect to the negotiation, execution, delivery and performance of
the Agreement. The Company shall, at the Initial Closing and within a reasonable
time after the Subsequent Closing, if applicable, reimburse the reasonable fees
and expenses of special counsel for the Purchasers, Xxxxxx Godward llp, not to
exceed $15,000, incurred in connection with the negotiation, execution, delivery
and performance of this Agreement, the Related Agreements and the transactions
contemplated by such agreements.
6.10 Attorneys' Fees. In the event that any suit or action is
instituted to enforce any provision in this Agreement, the prevailing party in
such dispute shall be entitled to recover from the losing party all fees, costs
and expenses of enforcing any right of such prevailing party under or with
respect to this Agreement, including without limitation, such reasonable fees
and expenses of attorneys and accountants, which shall include, without
limitation, all fees, costs and expenses of appeals.
6.11 Titles and Subtitles. The titles of the sections and subsections
of the Agreement are for convenience of reference only and are not to be
considered in construing this Agreement.
6.12 Counterparts. This Agreement may be executed in any number of
counterparts, each of which shall be an original, but all of which together
shall constitute one instrument.
6.13 Broker's Fees. Each party hereto represents and warrants that no
agent, broker, investment banker, person or firm acting on behalf of or under
the authority of such party hereto is or will be entitled to any broker's or
finder's fee or any other commission directly or indirectly in connection with
the transactions contemplated herein. Each party hereto further agrees to
indemnify each other party for any claims, losses or expenses incurred by such
other party as a result of the representation in this Section 6.13 being untrue.
6.14 Exculpation Among Purchasers. Each Purchaser acknowledges that
it is not relying upon any person, firm, or corporation, other than the Company
and its officers and directors, in making its investment or decision to invest
in the Company. Each Purchaser agrees that no Purchaser nor the respective
controlling persons, officers, directors, partners, agents, or employees of any
Purchaser shall be liable to any other Purchaser for any action heretofore or
hereafter taken or omitted to be taken by any of them in connection with the
Shares and Conversion Shares.
6.15 Confidentiality. Each party hereto agrees that, except with the
prior written consent of the other party, it shall at all times keep
confidential and not divulge, furnish or make accessible to anyone any
confidential information, knowledge or data concerning or
-19-
relating to the business or financial affairs of the other parties to which such
party has been or shall become privy by reason of this Agreement or the Related
Agreements, discussions or negotiations relating to this Agreement or the
Related Agreements, the performance of its obligations hereunder, the ownership
of the Shares purchased hereunder or the ownership of the Warrant Shares issued
in connection with the exercise of the Warrants. The provisions of this Section
6.15 shall be in addition to, and not in substitution for, the provisions of any
separate nondisclosure agreement executed by the parties hereto.
6.16 Pronouns. All pronouns contained herein, and any variations
thereof, shall be deemed to refer to the masculine, feminine or neutral,
singular or plural, as to the identity of the parties hereto may require.
6.17 Ongoing Expenses. Following the Initial Closing, reasonable
out-of-pocket expenses incurred by the Purchasers or their representatives on
behalf of the Company at its request, including reasonable out-of-pocket
expenses associated with attendance at meetings of the Board of Directors, shall
be borne by the Company.
6.18 Mutual Drafting. This Agreement is the result of the joint
efforts of the Company and each of the Purchasers, and each provision hereof has
been subject to the mutual consultation, negotiation and agreement of the
parties and there shall be no construction against any party based on any
presumption of that party's involvement in the drafting thereof.
[SIGNATURE PAGES FOLLOW]
-20-
IN WITNESS WHEREOF, the parties hereto have executed this Series C
Convertible Preferred Stock Purchase Agreement as of the date set forth in the
first paragraph hereof.
Company:
InPhonic, Inc.
By: /s/ Xxxxx X. Xxxxxxxxx
____________________________________________
Xxxxx X. Xxxxxxxxx
President and Chief Executive Officer
Address: 0000 Xxxxxxxxx Xxxxxx, X.X.
Xxxxx 000
Xxxxxxxxxx, X.X. 00000
Sterling:
Sterling Communications, Inc.
By: /s/ Xxxxx X. Xxxxxxxxx
____________________________________________
Name:
Title:
Address: 0000 Xxxxxxxxx Xxxxxx, X.X.
Xxxxx 000
Xxxxxxxxxx, X.X. 00000
SERIES C CONVERTIBLE PREFERRED STOCK PURCHASE AGREEMENT
INPHONIC, INC.
SERIES C CONVERTIBLE PREFERRED STOCK PURCHASE AGREEMENT
COUNTERPART SIGNATURE PAGE
IN WITNESS WHEREOF, the undersigned has hereunto set his hand as of the day
and year first above written.
/s/ Xxxxx X. Xxxxxxxxx
____________________________________
Xxxxx X. Xxxxxxxxx
22.
INPHONIC, INC.
SERIES C CONVERTIBLE PREFERRED STOCK PURCHASE AGREEMENT
COUNTERPART SIGNATURE PAGE
IN WITNESS WHEREOF, the undersigned has hereunto set his hand as of the day
and year first above written.
Mid-Atlantic Venture Fund III, L.P.
By: MAVF III Partners, L.P., a Pennsylvania
limited partnership
Its: General Partner
By: MAVF III G.P., Inc., a Pennsylvania
corporation
Its: General Partner
By: /s/ Xxxxxx X. Xxxxx
___________________________________
Xxxxxx X. Xxxxx
Its: Director
23.
INPHONIC, INC.
SERIES C CONVERTIBLE PREFERRED STOCK PURCHASE AGREEMENT
COUNTERPART SIGNATURE PAGE
IN WITNESS WHEREOF, the undersigned has hereunto set his hand as of the day
and year first above written.
RAFNet Ventures
By: /s/ Xxxxxx X. Xxxxxxx
___________________________________
Name:_________________________________
Title:________________________________
24.
INPHONIC, INC.
SERIES C CONVERTIBLE PREFERRED STOCK PURCHASE AGREEMENT
COUNTERPART SIGNATURE PAGE
IN WITNESS WHEREOF, the undersigned has hereunto set his hand as of the day
and year first above written.
Mt. Washington Associates L.L.C.
By: /s/ Xxxxx X. Xxxxxx, Xx.
____________________________________
Name: Xxxxx X. Xxxxxx, Xx.
Title:_________________________________
25.
INPHONIC, INC.
SERIES C CONVERTIBLE PREFERRED STOCK PURCHASE AGREEMENT
COUNTERPART SIGNATURE PAGE
IN WITNESS WHEREOF, the undersigned has hereunto set his hand as of the
day and year first above written.
/s/ Xxxx Xxxxxxx
_________________________________
Xxxx Xxxxxxx
26.
INPHONIC, INC.
SERIES C CONVERTIBLE PREFERRED STOCK PURCHASE AGREEMENT
COUNTERPART SIGNATURE PAGE
IN WITNESS WHEREOF, the undersigned has hereunto set his hand as of the
day and year first above written.
LBL Eventures, LLC
/s/ Xxxx XxXxxxx
________________________________
Name: Xxxx XxXxxxx
27.
INPHONIC, INC.
SERIES C CONVERTIBLE PREFERRED STOCK PURCHASE AGREEMENT
COUNTERPART SIGNATURE PAGE
IN WITNESS WHEREOF, the undersigned has hereunto set his hand as of the
day and year first above written.
/s/ Xxx Xxxxx
______________________________
Xxx Xxxxx
28.
INPHONIC, INC.
SERIES C CONVERTIBLE PREFERRED STOCK PURCHASE AGREEMENT
COUNTERPART SIGNATURE PAGE
IN WITNESS WHEREOF, the undersigned has hereunto set his hand as of the
day and year first above written.
/s/ Xxxxx X. Xxxxxxx
_____________________________
Xxxxx X. Xxxxxxx
29.
INPHONIC, INC.
SERIES C CONVERTIBLE PREFERRED STOCK PURCHASE AGREEMENT
COUNTERPART SIGNATURE PAGE
IN WITNESS WHEREOF, the undersigned has hereunto set his hand as of the
day and year first above written.
CMS Tech Co-Investment Subpartnership
By: /s/ Xxxxxxx X. Xxxxxxxx
______________________________________
Name: Xxxxxxx X. Xxxxxxxx
Title: Authorized Officer
30.
INPHONIC, INC.
SERIES C CONVERTIBLE PREFERRED STOCK PURCHASE AGREEMENT
COUNTERPART SIGNATURE PAGE
IN WITNESS WHEREOF, the undersigned has hereunto set his hand as of the
day and year first above written.
CMS PEP XIV Co-Investment Subpartnership
By: /s/ Xxxxxxx X. Xxxxxxxx
_________________________________________
Name: Xxxxxxx X. Xxxxxxxx
Title: Authorized Officer
31.
