Purchase Agreement and Plan of Reorganization - InPhonic Inc. and GadgetSpace Inc.
PURCHASE AGREEMENT AND PLAN OF REORGANIZATION
THIS PURCHASE AGREEMENT AND PLAN OF REORGANIZATION (this "Agreement")
is entered into as of this 26 day of October 2001 (the "Effective Date") by and
between INPHONIC, INC., a Delaware corporation ("Buyer") and GADGETSPACE, INC.,
a North Carolina corporation ("Seller").
Recitals
WHEREAS, Seller desires to transfer to Buyer at the Closing (as
hereinafter defined), and Buyer desires to acquire from Seller substantially all
of Seller's assets, as more fully described herein, upon and subject to the
terms and conditions contained in this Agreement.
WHEREAS, it is intended by the parties that the transaction qualify as
a tax-free reorganization within the meaning of Section 368(a)(1)(c) of the
Internal Revenue Code of 1986, as amended (the "Code"). For accounting purposes,
it is intended that the transaction be treated as a "purchase".
Agreement
Now, Therefore, in consideration of the foregoing recitals and the
mutual covenants contained herein, and other good and valuable consideration,
the receipt and sufficiency of which are hereby acknowledged, Buyer and Seller,
intending to be legally bound, hereby agree as set forth below.
ARTICLE I
DEFINITIONS
Definitions. In addition to the terms defined elsewhere herein. when
used herein, the following capitalized terms shall have the meanings indicated:
"Act of Bankruptcy" when used in reference to any Person, shall mean
the occurrence of any of the following with respect to such Person: (a) such
Person shall have made an assignment of all or substantially all of its assets
for the benefit of his or its creditors; (b) such Person shall have filed a
voluntary petition in bankruptcy; (c) such Person shall have been adjudicated
bankrupt or insolvent; (d) such Person shall have filed any petition or answer
seeking for himself or itself any reorganization, liquidation, dissolution or
similar relief, (e) such Person shall have sought Or consented to, or acquiesced
in, the appointment of any trustee, receiver, or liquidator of such Person of
all or substantially all of the properties of such Person; or (f) sixty (60)
days shall have elapsed after the commencement of an action against such Person
seeking reorganization, arrangement liquidation, dissolution or similar relief
without such action having been dismissed-
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"Affiliate" when used in reference to any Person, shall mean any Person
that, directly or indirectly through one or more `intermediaries, controls, is
controlled by or is under common control with the Person in question.
"Applicable Law(s)" shall mean any applicable federal, state, local or
foreign law, ordinance, order, regulation, rule or requirement of any
governmental or quasi-governmental agency, instrumentality, board, commission,
bureau or other authority having jurisdiction.
"Assets" shall mean (i) all right, title and interest of Seller in and
to the assets, real property, personal property, equipment, intellectual
property, software and other property of Seller set forth on Exhibit 1 attached
hereto (the "Inventory"), (ii) all transferable net operating losses,
capitalized expenses and research and development costs of Seller which may
benefit the Buyer, (iii) a certificate of deposit in an amount of at least
$201,852, (iv) the sum of $100,000 in cash which represents prepayment of fees
under the contract between Seller and Symbol Technologies, Inc. and (v) the sum
of $1,000,000 in additional cash.
"Material Adverse Effect" shall mean any material adverse change or any
development involving a prospective material adverse change in or affecting the
general affairs, business, prospects, management, financial position,
stockholders' equity or results of operations of a Person, taken as a whole.
"Person" shall mean any individual, corporation, partnership, joint
venture, limited liability company, unincorporated association, trust or other
legal entity.
"Transferred Names" shall have the meaning, set forth in Exhibit 7 to
this Agreement.
ARTICLE II
SALE AND TRANSFER OF ASSETS AND ASSUMPTION OF CERTAIN
LIABILITES
2.1 Transfer of Assets. Except as otherwise herein expressly set forth,
Seller hereby agrees that at the Closing provided for in Section 4.1 hereof (the
"Closing"), Seller shall sell, assign, transfer, convey and deliver to Buyer all
of Seller's right, title and interest in and to the Assets.
2.2 Excluded Assets. Seller and Buyer understand and agree that the
sale, assignment, transfer, conveyance and delivery specified in Section 2.1
hereof shall not include any assets, rights or property of Seller other than
those expressly included in the definition of Assets.
2.3 Assumed Obligations. Buyer agrees that at the Closing, Buyer shall
assume those contracts, agreements, leases, covenants, obligations and
liabilities on the list attached
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hereto as Exhibit 2 (collectively, the "Assumed Liabilities"). As of the Closing
Date, Seller, as soon as reasonably practicable thereafter, will terminate any
and all of Seller's other contracts, leases, licenses and agreements and Seller,
shall remain liable for any and all of its liabilities or encumbrances not
specifically assumed by Buyer pursuant to this Section 2.3, `including but not
limited to:
(a) liens and encumbrances to which the Assets are subject, or would
have been subject to, immediately prior to Closing;
(b) any liability or obligation relating to taxes of Seller,
including any interest or penalties related thereto;
(c) any warranty or performance liability claims relating to the
assets which arose prior to the Closing; and
(d) any liability or obligation of the Seller, absolute or
contingent, known or unknown not expressly agreed to be assumed
pursuant to this Agreement.
ARTICLE III
CONSIDERATION
3.1 Assumption of Certain Liabilities, Stock Issuance and Stock
Restriction Agreement. In full and complete payment for the Assets, Buyer agrees
to (i) the assumption of the Assumed Liabilities pursuant to Section 2.3 hereof,
(ii) issue to the Seller 2,396,825 shares of Common Stock of the Buyer, priced
at $3.15 per share, issued in the name of and paid to Seller, subject to the
terms and conditions of the Stock Restriction Agreement attached hereto as
Exhibit 3 to this Agreement and Section 3.2 herein (the "Common Stock"); and
(iii) issue to the Seller 333,333 shares of Series D-2 Preferred Stock of Buyer,
priced, at $3.15 per share, issued in the name of and paid to Seller, pursuant
to the terms and conditions of a separate Stock Purchase Agreement attached as
Exhibit 4 to this Agreement and incorporated herein by this reference (the
"Preferred Stock") (the Common Stock and the Preferred Stock are collectively
the "InPhonic Stock").
3.2 Escrow. The Parties agree that 79,365 shares of Common Stock of the
Buyer, provided in part payment for the Assets pursuant to Section 3.1 of this
Agreement, shall be held pursuant to an Escrow Agreement in an escrow account by
Piper Marbury Rudnick & Wolfe LLP (the "Escrow Agreement") until the earlier of
(i) the inspection and acceptance of the Assets by the Buyer, pursuant to the
terms of the Escrow Agreement attached hereto as Exhibit 5 or (ii) seven (7)
calendar days from the Effective Date of this Agreement, unless a Claim Notice,
as defined under the Escrow Agreement, has been provided to the Escrow Agent;
provided, in such event, the shares held in Escrow shall be distributed pursuant
to the Escrow Agreement.
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ARTICLE IV
CLOSING AND CONDITIONS OF CLOSING
4.1 Closing. The Closing shall occur upon the later of (i) the close of
business on October 26, 2001 or (ii) as soon thereafter as practicable following
the satisfaction or waiver of all of the Conditions to Closing set forth in
Section 4.2 of this Agreement (the "Closing Date").
4.2 Conditions to Closing. The obligation of Seller to sell the Assets
and Buyer to purchase the Assets is subject to the satisfaction of the following
conditions precedent at or prior to the Closing (unless waived in writing by the
Parties prior to Closing or by the act of Closing):
(a) Documents. Buyer shall have received each of the following items:
(i) This Agreement, duly executed by Seller;
(ii) Any amendment, consent or waiver- from any Person
necessary to fully give binding effect to this
Agreement, including but not limited to consents to
the assignment of contracts and leases, duly executed
by Seller and such Persons (the "Consents") (each
party hereto acknowledges that this condition is for
the benefit of both Buyer and Seller;
(iii) The Bill of Sale in substantially the form attached
hereto as Exhibit 6, duly executed by Seller;
(iv) Such certificates, documents of title and other
instruments of conveyance and transfer, if any, as
shall be effective to vest in Buyer good and
marketable title in and to the Assets free and clear
of all encumbrances, including, by way of example but
not limitation, the Trademark/Domain Assignment
Agreement, as attached as Exhibit 7;
(v) An Officer's Certificate in substantially the form
attached hereto as Exhibit 8, duly executed by an
officer of Seller,
(vi) Copies of invention assignment agreements, executed
by each of Seller's employees, in substantially the
form attached hereto as Exhibit 9;
(vii) The Escrow Agreement, duly executed by Seller,
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(viii) The Stock Restriction Agreement, duly executed by
Seller;
(ix) Assignment of the certificate of deposit in an amount
of at least $201,852;
(x) Check or wire transfer in the amount of $100,000; and
(xi) Check or wire transfer of $1,000,000.
Seller shall have received each of the following items:
(i) This Agreement, duly executed by Buyer;
(ii) The Certificate of Assumption in substantially the
form attached hereto as Exhibit 10, duly executed by
Buyer-,
(iii) The Stock Restriction Agreement, duly executed by
Buyer;
(iv) An Officer's Certificate, in substantially the form
attached hereto as Exhibit 11, duly executed by an
officer of Buyer;
(v) The Escrow Agreement, duly executed by Buyer; and
(vi) The InPhonic Shares.
(b) Employees. Seller and Buyer understand and agree that Seller shall
terminate the employment of certain of its employees including, by way of
example but not limitation, Messrs. Ken Landry and Karl Schlatzer as of or prior
to the Closing Date. Before or promptly upon the execution of this Agreement,
Buyer may, at its option, offer employment to any of the terminated employees,
including, by way of example and not limitation, Messrs. Landry and Schiatzer,
and shall have sole responsibility for the negotiation of employment agreements
with such employees.
(c) Approval. Seller shall have received the approval of both its board
of directors and its shareholders authorizing the consummation of the
transactions contemplated by this Agreement and the acceptance of the
restrictions outlined in the Stork Restriction Agreement (each party hereto
acknowledges that this condition is for the benefit of both Buyer and Seller).
(d) Material Adverse Effect.. Prior to the Closing Date, neither party
shall have experienced a Material Adverse Effect relating to (i) the Assets or
(ii) the ability of Seller or Buyer to perform their respective obligations
under this Agreement.
(e) Litigation. On the Closing Date, there shall be no lawsuits pending
against either party hereto seeking to enjoin, prohibit, restrain or otherwise
prevent the transaction contemplated by this Agreement.
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(f) Other Documents. The provision and/or execution of such other
documents relating to the transactions contemplated by this Agreement as Buyer
may reasonably request-
(g) Series D-2 Documents. Prior to the Closing, Buyer and Seller shall
have negotiated mutually acceptable documents, including but not limited to
amended and restated versions of Buyer's certificate of incorporation, voting
agreement, investor rights agreement, right of first refusal and co-sale
agreement and certain other agreements, relating, to the terms of the Seller's
Series D-2 Preferred Stock (the "Preferred Documents"), the Preferred Documents
shall have been authorized by appropriate corporate action and filed or executed
by all necessary parties, including but not limited to the holders of the
Seller's other series of preferred stock, as appropriate, and the Preferred
Documents shall be fully effective-
(h) Seller's Financing. Prior to the Closing, Date, Seller shall have
completed its offer and sale of Series A-1 Preferred Stock to the extent
necessary to ensure that Seller has adequate cash on hand to transfer all of the
Assets and satisfy its remaining liabilities (each party hereto acknowledges
that this condition is for the benefit of both Buyer and Seller).
ARTICLE V
REPRESENTATIONS AND WARRANTIES OF SELLER
Except as set forth on the schedule of exceptions attached hereto as
Exhibit 12 (the "Schedule of Exceptions"), Seller represents and warrants to
Buyer as of the date hereof (which representations and warranties shall survive
the execution and delivery of this Agreement and the transfer of the Assets as
set forth in Section 9.4), as set forth below:
5.1 Qualification. Seller represents that it is duly qualified to
conduct business as it is currently being conducted and is in -good standing as
a foreign corporation in all jurisdictions in which the nature of its business
or location of its owned and leased property and assets requires such
qualification, except where failure to be so qualified would not have a Material
Adverse Effect.
5.2 Litigation. There are no outstanding orders, judgments, writs,
injunctions. or decrees of any court, Government Authority or arbitration or
mediation panel or tribunal against or affecting the Assets.
5.3 Non-Contravention. Seller is not in breach of, default under, or
in violation of any Applicable Law, decree or order that may cause a Material
Adverse Effect relating to the Assets and Seller is not in breach of, default
under, or in violation of any deed, lease, loan agreement, commitment, bond,
note, deed of trust, restrictive covenant, license, indenture, contract or other
agreement, instrument or obligation to which it is a party or by which it is
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bound or to which any of its respective assets is subject that may cause a
Material Adverse Effect on the Assets.
5.4 Title. Seller has good, complete, indefeasible and marketable
title to, and ownership of, all of the Assets, free and clear of all liens,
defects, claims, security interests and encumbrances including, but not by way
of limitation, any liens or encumbrances on behalf of or otherwise related to
HA.HT Commerce, Inc.
5.5 Taxes. Buyer acknowledges that Seller and its subsidiaries have
not timely filed with the appropriate taxing authorities, including but not
limited to the Internal Revenue Service of the United States and the Department
of Revenue of the state of North Carolina, the tax returns that they were
required to file.
5.6 Subsidiaries. BrightPod ASP, Jnc., a Delaware corporation, is a
wholly-owned subsidiary of Seller otherwise, Seller has no subsidiaries,
Affiliates, partnerships nor any other commonly controlled or related entities.
5.7 Intellectual Property. Seller owns, or possesses adequate rights
to use, all intellectual property (including but not limited to any patents,
trademarks, and copyrights) necessary for the conduct of its business and
neither Seller nor any of its officers have received any notice of conflict
with, or infringement of, the asserted rights of others including, but not by
way of limitation, HAHT Commerce, Inc., with respect to any such intellectual
property, and neither Seller nor any of its officers knows of any reasonable
basis therefor.
5.8 Legal Compliance. To its knowledge, Seller (i) is not in violation
of any Applicable Law that would apply to it or to its business, the violation
of which would cause a Material Adverse Effect on the Assets (ii) Seller is not
in violation of any applicable environmental, securities or employee benefits
law, which violation would cause a Material Adverse Effect on the Assets, and
(iii) neither Seller nor, to the knowledge of Seller, any of Seller's agents,
contractors or employees has been notified of any action, suit, proceeding or
investigation which calls into question compliance by Seller.
5.9 Licenses. Simultaneously with the Closing, Seller shall have
acquired good title or all necessary rights to all of the licenses, permits,
approval and authorizations needed to transfer the Assets to Seller in
compliance with all Applicable Laws.
5.10 Undisclosed Liabilities. The Seller does not have any liabilities
(whether known or unknown, whether absolute or contingent whether liquidated or
unliquidated and whether due or to become due), except for (a) liabilities that
will be accrued for or reserved against in the August 31, 2001 balance sheet,
attached as Exhibit 13 to this Agreement and (b) contractual or statutory
liabilities incurred in the ordinary course of business which are not required
to be reflected on a balance sheet. There are no outstanding loans due or
deferred compensation from Seller to any employee of Seller.
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5.11 Assets. The Assets are in good operating condition (subject to
normal wear and tear) and are suitable for the purposes for which they are used
in Seller's business.
ARTICLE VI
REPRESENTATIONS AND WARRANTIES OF BUYER
Buyer represents and .warrants to Seller as of the date hereof (which
representations and warranties shall survive the execution and delivery of this
Agreement and the transfer of the Assets as set forth in Section 9.4) as set
forth below:
6.1 Qualification. Buyer represents that it is duly qualified to
conduct business as it is currently being conducted and is in good standing as a
foreign corporation in all jurisdictions in which the nature of its business or
location of its owned and leased property and assets requires such qualification
except where failure to be so qualified would not have a Material Adverse
Effect.
6.2 Litigation. There are no outstanding orders, judgments, writs,
injunctions or decrees of any court, Government Authority or arbitration or
mediation panel or tribunal against or involving Buyer likely to have a Material
Adverse Effect.
6.3 Non-Contravention. Buyer is not in breach of, default under, or in
violation of any Applicable Law, decree or order that may cause a Material
Adverse Effect, and Buyer is not in breach of, default under, or in violation of
any deed, lease, loan agreement, commitment, bond, note, deed of trust,
restrictive covenant, license, indenture, contract or other agreement,
instrument or obligation to which it is a party or by which it is bound or to
which any of its respective assets is subject that may cause a Material Adverse
Effect.-
6.4 Taxes. Buyer has filed all tax returns (federal, state, local and
foreign) that are required to be filed and has duly paid or fully reserved for
all taxes or installments thereof (including any interest or penalties) as and
when due which have or may become due pursuant to said returns or pursuant to
any assessment received by Buyer.
6.5 Legal Compliance. To its knowledge, (i) Buyer is not in violation
of any Applicable Law that would apply to it or to its business, the violation
of which would cause a Material Adverse Effect, (ii) Buyer is not in violation
of any applicable environmental, securities or employee benefits law, which
violation would cause a Material Adverse Effect, and (iii) neither Buyer nor, to
the knowledge of Buyer, any of Buyer's agents, contractors or employees has been
notified of any action, suit, proceeding or investigation which calls into
question compliance by Buyer.
6.6 Shares and Corporate Documents. All of the InPhonic Shares to be
issued hereunder have been duly authorized and when issued will be valid and
legally issued shares of the common stock and Series D-2 Preferred Stock of
Buyer, fully paid and nonassessable, free
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and clear of all liens or encumbrances, and not in violation of any preemptive
or similar rights or any securities laws. Prior to the Effective Date, Buyer has
delivered to Seller a true, correct, and complete copy of the current
certificate of incorporation and bylaws of Buyer. All common stock issued to
Seller shall be subject to the terms of the Stock Restriction Agreement.
6.7 Undisclosed Liabilities. The Buyer does not have any liabilities
(whether known or unknown, whether absolute or contingent whether liquidated or
unliquidated and whether due or to become due), except for (a) liabilities that
will be accrued for or reserved against in the August 31, 2001 balance sheet,
attached as Exhibit 14 to this Agreement and (b) contractual or statutory
liabilities incurred in the ordinary course of business which are not required
to be reflected on a balance sheet. Buyer's balance sheet attached hereto and
the related income statement attached hereto as Exhibit 15 were prepared in
accordance with generally accepted accounting principals and fairly present the
assets, liabilities, financial condition and results of operations of Buyer as
of the date indicated and for the period referred to therein. Except as
disclosed in writing to Buyer, there have been no events, changes or effects
with respect to Buyer or its subsidiaries that, individually or in the
aggregate, have had or reasonably would be expected to have had a Material
Adverse Effect.
ARTICLE VIII
MUTUAL REPRESENTATIONS AND WARRANTIES
Each party hereto represents and warrants to the other party as of the
date hereof (watch representations and warranties shall survive the execution
and delivery of this Agreement and the transfer of the Assets) as set forth
below:
7.1 Organization; Good-Standing.
(a) Seller is a corporation duly formed, validly organized and in good
standing in the State of North Carolina. All of Seller's documents related to
its status as a corporation are in full force and effect as of the date hereof
(b) Buyer is a corporation duly formed, validly organized and in good
standing, in the State of Delaware. All of Buyer's documents related to its
status as a corporation are in full force and effect as of the date hereof.
7.2 No Untrue Statements or Material Omissions. Each party hereto
represents to the. other party hereto, on its own respective behalf, that no
statement in writing furnished by such party to the other party in connection
with the transactions contemplated herein contains any untrue statement of
material fact or omits to state a material fact necessary to make the statement
not misleading in any material respects.
7.3 No Default. Each party hereto represents to the other party, on
its own respective behalf, that neither the execution and delivery of this
Agreement nor the performance by such
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party of its respective obligations hereunder will cause any such breach,
default or violation or will require the consent or approval of any court or
governmental authority, except as expressly contemplated by the terms of this
Agreement.
7.4 Power and Authority. Each party hereto represents to the other
party, on its own respective behalf, that (i) it has full power and authority to
enter into this Agreement any other related documents, to incur the obligations
as contemplated hereby, and to carry out the provisions of this Agreement; and
(ii) it has taken all action necessary for the execution and delivery of this
Agreement and each of the other related documents and for the performance of
each of its obligations hereunder, and thereunder, as evidenced by corporate
resolution(s) or other authorization.
7.5 Enforceability. Upon execution and delivery by each of the parties
hereto, this Agreement and any other related document shall be the legal, valid
and binding obligations of each party and shall be enforceable against each
party in accordance with their respective terms.
ARTICLE VIII
TERMINATION OF AGREEMENT
This Agreement may be terminated at any time prior to the Closing:
(a) By written agreement of Buyer and Seller.
(b) By Buyer, upon ten (10) days' prior written notice to Seller if
(i) there has been a material violation or breach by Seller of any
of the agreements, representations or warranties (except to the
extent that Seller has made exception thereto in the Schedule of
Exceptions attached hereto) contained in this Agreement, or (ii)
if any of the conditions set forth in Section 4.2 have not been
materially satisfied by the Closing, and either (i) or (ii) have
not been waived in writing by Buyer or cured within such ten-day
period.
(c) By Seller, upon ten (10) days' prior written notice to Buyer if
(i) there has been a material violation or breach by Buyer of any
of the agreements, representations or warranties contained in this
Agreement, or (ii) if any of the conditions set forth in Section
4.2 have not been materially satisfied by the Closing, and either
(i) or (ii) have not been waived in writing by Seller or cured
within such ten-day period.
(d) By either party hereto if the transactions contemplated by this
Agreement shall not have been consummated on or before 12:00 p.m.
November 12, 200 1.
(e) By either party hereto if the other makes an assignment for the
benefit of creditors, files a voluntary petition in bankruptcy or
seeks or consents to any reorganization or similar relief under
any present or future bankruptcy act or similar law, or is
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adjudicated a bankrupt or insolvent, or if a third party commences any
bankruptcy, insolvency, reorganization or similar proceeding
involving, the other.
(f) By either party if the holders of more than 10% of Seller's shares
dissent at the shareholders' meeting called to approve the
transactions contemplated by this Agreement.
ARTICLE IX
MISCELLANEOUS
9.1 Non-Waiver. No course of dealing between the parties or any failure or
delay on the part of either party in exercising any rights or remedies hereunder
shall operate as a waiver of any rights or remedies of either party under this
or any other applicable instrument. No single or partial exercise of any rights
or remedies hereunder shall operate as a waiver or preclude the exercise of any
other rights or remedies hereunder.
9.2 Indemnification.
(a) Seller. Seller hereby agrees to defend, indemnify and hold harmless
Buyer against any and all actions, suits, proceedings, claims, demands,
judgments, costs and expenses directly related to or arising from (i) the breach
of a representation or warranty by Seller herein or the documents delivered at
Closing or (ii) (ii) any liabilities of Seller not assumed by Buyer at Closing.
(b) Buyer. Buyer hereby agrees to defend, indemnify and hold harmless
Seller against any and all actions, suits, proceedings, claims, demands,
judgments, costs and expenses directly related to or arising from (i) the breach
of a representation or warranty by Seller herein or the documents delivered at
Closing or (ii) any of the Assumed Liabilities.
(c) Procedure. The indemnified party shall promptly notify the
indemnifying, party in writing of any claim, demand, action or proceeding for
which indemnification will be sought under Sections 9.2(a) or 9.2(b), and, if
such claim, demand, action or proceeding is a third party claim, demand, action
or proceeding, the indemnifying party will have the right at its expense to
assume the defense thereof using counsel reasonably acceptable to the
indemnified party. The indemnified party shall have the right to participate, at
its own expense, with respect to any such third party claim, demand, action or
proceeding. In connection with any such third party claim, demand, action or
proceeding, Buyer and Seller shall cooperate with each other and provide each
other with access to relevant books and records in their possession related to
such claim. No such third party claim, demand, action or proceeding shall be
settled without the prior written consent of the indemnified party, which
consent shall not be unreasonably withheld. If a firm written offer is made to
settle any such third party claim, demand, action or proceeding, which offer
does not involve any injunctive or non-monetary relief against the indemnified
party, and
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the indemnifying party proposes to accept such settlement and the indemnified
party refuses to consent to such settlement, then: (i) the indemnifying party
shall be excused from, and the indemnified party shall be solely responsible
for, all further defense of such third party claim, demand, action or proceeding
and (ii) the maximum liability of the indemnifying party relating to such third
party claim, demand, action or proceeding shall be the amount of the proposed
settlement if the amount thereafter recovered from the indemnified party on such
third party claim, demand, action or proceeding is greater than the amount of
the proposed settlement. In the event that Buyer or Seller shall fail to make
such commercially reasonable efforts to mitigate or resolve any claim or
liability, then notwithstanding, anything else to the contrary herein, the other
party shall not be required to indemnify any person for any Losses that could
reasonably be expected to have been avoided if Buyer or Seller, as the case may
be, had made such efforts.
9.3 Notices. All notices or communications under this Agreement or the
Debenture shall be to the following addresses (or to such other address as shall
at any time be designated by any party in writing to the other parties):
To Buyer: InPhonic, Inc.
1010 Wisconsin Avenue, NW
Suite 250
Washington, DC 20007
Attention: David A. Steinberg, CEO
With a copy to: Piper Marbury Rudnick & Wolfe LLP
1200 Nineteenth Street NW
Washington, DC 20036-2412
Attention: Ned Martin, Esquire
To Seller: GadgetSpace, Inc.
C/o Wyrick Robbins Yates & Ponton, LLP
4101 Lake Boone Trail, Suite 300
Raleigh, North Carolina 27607
Attention: W. David Mannheim
With a copy to: Harbinger/Aurora Venture Funds
2525 Meridian Parkway
Suite 220,
Durham, North Carolina 27713
Attention: Richard C. Brown
Notice shall be deemed given three days after deposit in the U.S. mail,
postage prepaid, or one day after deposit with a nationally recognized overnight
delivery service. Rejection or other refusal to accept, or the inability to
deliver because of a changed address of which no notice was given, shall not
affect the effectiveness or the date of delivery for any notice sent in
accordance with the foregoing provisions.
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9.4 Binding Agreement; Survival. This Agreement shall inure to the benefit
of, and be binding upon, Seller and Buyer, and their respective legatees,
distributees, estates, executors, administrators, personal representatives,
successors and assigns, and other legal representatives. All representations,
warranties, covenants and agreements by the parties contained in this Agreement
shall survive the Closing for a period of one (1) year from the Closing Date.
9.5 Entire Agreement; Integration Clause. This Agreement and the Exhibits
hereto set forth the entire agreement and understanding of the parties hereto
with respect to this transaction, and any prior agreements are hereby merged
herein and terminated.
9.6 Brokerage. Buyer warrants that it has made no arrangement for
brokerage commissions, finders' fees or similar compensation in connection with
the transactions contemplated by this Agreement and Buyer and Seller acknowledge
and agree that Seller has a finders' fee arrangement with Hank Firey, an
individual. Seller shall satisfy its obligations to Hank Firey subsequent to the
Closing and agrees to indemnify Buyer against any claim by Hank Firey relating
to this finders liability, based an any arrangement or agreement binding upon
either party.
9.7 No Oral Modification or Waivers. The terms herein may not be modified
or waived orally, but only by an instrument in writing signed by the party
against which enforcement of the modification or waiver (as the case may be) is
sought.
9.8 Controlling Law; Venue. This Agreement and each of the other documents
ancillary hereto shall be governed by, and interpreted and construed in
accordance with, the internal laws of the State of Maryland (without regard to
its conflicts of law principles). Venue for the adjudication of any claim or
dispute arising out of this Agreement or any of the other ancillary documents
shall be proper only in the state or federal courts of the State of Maryland,
and all parties to this Agreement and its ancillary documents hereby consent to
such venue.
9.9 Headings. The headings of this Agreement and each of the other
documents ancillary hereto are inserted for convenience only and shall not be
deemed to constitute a part of this Agreement or such ancillary documents.
9.10 Severabilitv. To the extent any provision herein violates any
applicable law, that provision shall be considered void and the balance of this
Agreement shall remain unchanged and in full force and effect.
9.11 Public Disclosure. Except as otherwise herein expressly set forth,
Seller and Buyer agree not to make or cause to be made, whether orally or in
writing or otherwise, any public announcement or disclosure with respect to the
transactions contemplated by this Agreement or any of the provisions of this
Agreement without the prior written approval by the other party of the form and
content of such announcement or disclosure.
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9.12 Counterparts. This Agreement may be executed in as many counterpart
copies as may be required. All counterparts shall collectively constitute a
single agreement
9.13 Press Releases and Announcements. No party shall issue any press
release or public disclosure relating to the subject matter of this Agreement
without the prior written approval of the other party; provided, however, that
any party may make any public disclosure it believes in good faith is required
by law or regulation (in which case the disclosing party shall advise the other
party and provide them with a copy of the proposed disclosure prior to making
the disclosure).
9.14 Third Party Beneficiary. This Agreement shall not confer any rights or
remedies upon any person other than the parties and their respective successors
and permitted assigns.
9.15 Expenses. Each party shall be responsible for its own costs and
expenses (including legal, financial advisory, investment banking and accounting
fees and expenses) incurred in connection with this Agreement and the
transactions contemplated hereby.
9.16 Tax Treatment Buyer and Seller hereby agree and covenant that they
shall not (before or after the Closing Date and individually or collectively)
take any action and shall not (before or after the Closing) fail to take any
action which action or failure to act would prevent, or would be reasonably
likely to prevent, the transactions contemplated hereby from qualifying as a
reorganization within the meaning of Section 368(l)(c) of the Code.
9.17 Dissolution. Buyer and Seller hereby agree that from and after the
Closing Date, Seller will not engage in any new business, will promptly
liquidate and dissolve as a corporation, and will distribute to Seller's
shareholders the InPhonic Shares.
SIGNATORY PAGE TO FOLLOW
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In Witness Whereof, the undersigned have executed and delivered this
Agreement as of the day and year first above written.
INPHRONIC, INC GADGETSPACE, INC.
/s/ David A. Steinberg /s/ David Motsinger
_____________________________________ __________________________________
Name: _______________________________ Name: ____________________________
Title: ______________________________ Title: ___________________________
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