all right, title and interest in and to or possesses valid and enforceable licenses to all (y) other Company Intellectual Property and (z) all other Intellectual Property used in the conduct of the business of the
Company, free and clear of all Liens other than (1) Permitted Liens or (2) any applicable licenses set forth on Schedule 3.16.
(c) Except as set forth on Schedule 3.15, (i) the Company has not received any notice of infringement or misappropriation of or conflict with any Intellectual Property of any third party (including, without limitation, any written demands or written unsolicited offers to license any Intellectual Property from any third party that reference a third party patent and a Company product or service); (ii) to the Knowledge of the Company, neither the conduct of its business nor any of the products sold or services provided by the Company in connection therewith infringes, misappropriates or otherwise conflicts with
Intellectual Property of any third party; (iii) to the Knowledge of the Company, no third party has
infringed, misappropriated or otherwise conflicted with any Company Intellectual Property; and (iv) no claims are pending or to the Knowledge of the Company threatened against the Company by any third party regarding the use or ownership of any Company Intellectual Property, or challenging or questioning the validity or enforceability of any Company Intellectual Property, and there are no grounds for the same.
(d) (i) No Company Intellectual Property has been abandoned or permitted to lapse, and (ii) the
Company has used all commercially reasonable efforts to maintain and protect the Company Intellectual Property, in each case except as set forth on Schedule 3.15.
(e) Except as set forth on Schedule 3.15, (i) the transactions contemplated by this Agreement will not have a Material Adverse Effect on the Company's right, title or interest in and to the Company Intellectual Property, and (ii) all of such Company Intellectual Property shall be owned or available for use by the Company immediately after Closing on terms and conditions identical to those under which such
Company Intellectual Property was owned or available for use by the Company immediately prior to the Closing.
(f) Except as set forth on Schedule 3.15, (i) the Company has taken steps reasonable under the circumstances to protect and preserve the confidentiality of all trade secrets and material confidential information of the Company, and (ii) the Company has instituted policies requiring each employee, consultant and independent contractor (1) to execute proprietary information and confidentiality
agreements, and (2) to execute agreements assigning to the Company any Intellectual Property arising out of such employee's, consultant's or independent contractor's employment or engagement, in each case prior to or upon their employment or engagement.
(g) The Internet domain names listed on Schedule 3.15 (the \for the last 12 months as set forth on Schedule 3.15. Schedule 3.15 also includes a complete list of amounts (and payees to which) the Company has paid to any Person for expenses in any way related to advertising or promoting the Sites. The Company has never supported a \disclosed on Schedule 3.15 to generate traffic to the Site, and is not aware of any other Internet sites that may be linking to the Sites pursuant to any other direct or indirect business or personal relationship,
irrespective of whether a fee has been paid or is payable. The Stockholders have no reason to believe Site traffic will decrease in any material respect after the consummation of the transactions contemplated by this Agreement, assuming there is no change in either external factors affecting traffic or search engine optimization efforts.
Section 3.16 Contracts. Except for contracts, commitments, plans, agreements and licenses listed on Schedule 3.16 hereto (true and complete copies (including all amendments, exhibits, attachments, waivers or other changes thereto) of which have been made available to the Buyer and/or its agents) (the
\bound by:
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(a) any executory plan, contract, commitment or agreement providing for or relating to bonuses, stock, options, stock purchases, profit sharing, collective bargaining or the like or any contract or agreement with any labor union (other than the plans listed on Schedule 3.19) or containing any severance
obligations or providing for the payment of cash or other compensation or benefits upon the sale of all or a portion of the assets of the Company or a change of control;
(b) (i) any executory employment contracts or (ii) any executory consulting or independent contractor contract or any contract for services;
(c) any executory contract or agreement for the purchase of any commodity, material or equipment; (d) any other executory contract or agreement which by its terms is not terminable by the Company at will and without payment of a penalty;
(e) any contract containing covenants limiting the freedom of the Company to compete in any line of business or with any Person;
(f) any partnership, joint venture or other similar contract or agreement;
(g) any contract or agreement providing for the license of patents, trademarks, service marks, trade names or copyrights between the Company and any third party (other than licenses of commercially available, off-the-shelf software);
(h) any settlement, conciliation or similar agreement, the performance of which involves payment after the execution date of this Agreement or monitoring by a Governmental Authority, consent decree or reporting responsibilities to a Governmental Authority;
(i) any contract, agreement or arrangement under which the Company has advanced or loaned any amount to any of its directors, officers, managers or employees;
(j) any contract, agreement or arrangement for capital expenditures or the acquisition or construction of fixed assets;
(k) any contract, agreement or arrangement that would constitute Indebtedness of the Company
(l) any contract, agreement or arrangement granting any Person a Lien on all or any material part of the assets of the Company, other than Liens which will be released at the Closing;
(m) any contract, agreement or arrangement under which the Company is (i) a lessee or sublessee of any machinery, equipment, vehicle or other tangible personal property, or (ii) a lessor of any tangible personal property owned by the Company;
(n) any contract, agreement or arrangement containing releases, covenants, warranties or indemnities concerning environmental conditions of any real property; or
(o) other than the contracts, agreements or arrangements of the type covered by Sections 3.16(a)
through 3.16(n), any other contracts or agreements creating any obligation of the Company of more than $5,000 annually with respect to any such contract, agreement or arrangement.
All Contracts are valid and in full force and effect and constitute legal, valid and binding obligations of the Company and, to the Knowledge of the Company, the other parties thereto, and are enforceable against the Company in accordance with their respective terms, subject to applicable bankruptcy,
insolvency, reorganization, moratorium and similar laws affecting creditors' rights generally, and subject, as to enforceability, to general principles of equity (regardless of whether enforcement is sought in a proceeding at law or in equity). The Company is in default in complying with any material provisions thereof, nor has the Company received notice of any such default, and no condition or event or facts exist which, with notice, lapse of time or both, would constitute a default thereof on the part of the Company. Section 3.17 Insurance. The Company has made available to the Buyer true, correct and complete copies of all policies of insurance, including without limitation fidelity bonds, general liability policies, product liability, comprehensive general liability and umbrella insurance policies, maintained as of the date hereof by the Company (the \All such Insurance Policies are in full force and effect, and all premiums due under such Insurance
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Policies have been paid, and the Company is not nor has been in default with respect to its payment obligations under any such Insurance Policies.
Section 3.18 Permits. Except as set forth on Schedule 3.18 hereto, (i) the Company has obtained and currently holds and is in compliance with all terms and conditions of all permits, registrations, licenses, franchises, certifications, approvals, exemptions and other approvals (collectively, the \Governmental Authorities necessary for the conduct of its business as presently conducted, (ii) all such Approvals are valid and in full force and effect, and (iii) none of such Approvals is subject to termination by its terms as a result of the execution of this Agreement by the Company or by the consummation of the transactions contemplated by this Agreement.
Section 3.19 Employee Benefit Plans. All Employee Benefit Plans are listed on Schedule 3.19 hereto. With respect to each Employee Benefit Plan, a true and complete copy of each of the following documents has been provided or made available to the Buyer and/or its agents, if applicable: (i) the current plan document and all amendments thereto (or descriptions thereof for any unwritten Employee Benefit Plan), (ii) each trust, insurance contract or other funding arrangement, (iii) each summary plan description and any summary of material modifications thereto (or other descriptions or summaries that have been distributed to participants and beneficiaries for any Employee Benefit Plan not subject to ERISA), (iv) the most recently filed annual report on the Form 5500 with all attachments thereto, (v) the most recently received IRS determination letter or opinion letter, and (vi) all current contracts and agreements with service providers. Except as set forth on Schedule 3.19 hereto:
(a) all Employee Benefit Plans have been maintained, funded and administered in compliance in all material respects with their terms and all applicable Laws, including without limitation, the Employee Retirement Income Security Act of 1974, as amended (\
(b) each Employee Benefit Plan, the Company, each employee of the Company and each trustee, administrator or other fiduciary of an Employee Benefit Plan has not engaged in any breach of fiduciary responsibility or any \
Section 4975 of the Code) to which Section 406 of ERISA or Section 4975 of the Code applies and which could subject any Employee Benefit Plan, the Company, any such trustee or administrator thereof, or any other party dealing with any Employee Benefit Plan to liability or to a tax or penalty on prohibited transactions imposed by Section 4975 of the Code;
(c) no Employee Benefit Plan is a defined benefit pension plan (as defined in Section 3(35) of ERISA) or has been subject to the minimum funding requirements of Section 412 of the Code or to Title IV of ERISA. The Company and each other trade or business, whether or not incorporated, that together with the Company would be treated as a single employer under Section 414 of the Code (an \
Affiliate\Section 3(2) of ERISA) that is, or has been, subject to Title IV of ERISA or Section 412 of the Code. (d) the Company and each ERISA Affiliate have no obligation to contribute to, and have no liability with respect to, any \
(e) each Employee Benefit Plan intended to qualify under Section 401 of the Code has received a favorable determination letter from the Internal Revenue Service or is entitled to rely on a prototype
opinion letter that such Employee Benefit Plan is a \related trusts are exempt from tax under Section 501(a) of the Code, and no facts or circumstances exist that would be reasonably likely to jeopardize the qualification of such Employee Benefit Plan; (f) with respect to the Employee Benefit Plans, all required contributions, premiums or payments required to have been made or paid have been timely made or properly accrued on the Company's financial statements;
(g) the Company has no liability under any Employee Benefit Plan, or otherwise, to provide medical or death benefits with respect to current or former employees of the Company beyond their termination of
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employment (other than coverage mandated by law), and there are no reserve assets, surplus or prepaid premiums under any such Employee Benefit Plan;
(h) neither the execution and delivery of this Agreement nor the consummation of the transactions contemplated hereby (either alone or in conjunction with any other event) will (i) result in any payment of severance or other compensation to any current or former employee of the Company, or (ii) increase the amount of any compensation or benefits, or accelerate the time of payment or vesting of benefits, under any Employee Benefit Plan or otherwise with respect to any employee of the Company; and
(i) there are no pending or threatened claims (other than claims for benefits in the ordinary course), lawsuits or arbitrations that have been asserted or instituted involving any Employee Benefit Plan. No Employee Benefit Plan is under audit or investigation by the IRS, the U.S. Department of Labor or other Governmental Authority.
Section 3.20 Employees; Labor Matters. No employee of the Company is covered by a collective bargaining agreement or represented by a labor union, nor is there any collective bargaining agreement currently being negotiated by the Company. There have not been any labor disputes with any union with respect to the employees of the Company. There have not been any union organizational efforts or representation activities with respect to the employees of the Company. The Company has not experienced any work stoppage or slow down.
Section 3.21 Environmental Matters. Except as set forth on Schedule 3.21 hereto, since inception, the Company has obtained and possesses all material permits, licenses and other material authorizations required under federal, state and local Laws and regulations concerning worker safety and health or pollution or protection of the environment, in each case as enacted and in effect during the period of the Company's operations, including all such laws and regulations relating to the emission, discharge, release or threatened release of any petroleum, pollutants, environmental contaminants or hazardous or toxic materials, noise, odors, substances or wastes into air, surface water, groundwater or lands
(\always been, in material compliance with all terms and conditions of such permits, licenses and authorizations and is, and has always been, in material compliance with all other Environmental
Requirements. Except as set forth on Schedule 3.21 hereto, the Company has not received any written notice from any Governmental Authority or other third party asserting or alleging that the Company has failed in any respect to comply with any Environmental Requirements, or that the Company is liable in any material respect for any material injury or material damages to any Person or property because of the release or threatened release of any petroleum, pollutants, environmental contaminants, hazardous or toxic materials, substances or wastes. Except as set forth on Schedule 3.21, the Company has not treated, stored, handled, disposed of or released or exposed any person to any hazardous substance, or owned or to its Knowledge operated any property or facility contaminated by a hazardous substance, so as to give rise to any liabilities or obligations for fines, penalties, damages, or remedial or cleanup obligations under any Environmental Requirements, including without limitation any obligations to conduct or fund remedial or other response action. The Company has made available to the Buyer all material environmental audits and reports that are in the Company's possession and that relate to the Company's past or current properties, facilities or operations, which audits and reports are listed on Schedule 3.21 hereto. Section 3.22 Employee Relations.
(a) The Company is not delinquent in any material payments to any of its employees for any wages, salaries, commissions, bonuses, severance, termination pay or other compensation for any services performed for it to the date hereof or amounts required to be reimbursed to such employees.
(b) Except as set forth on Schedule 3.22(b), (i) there is not pending or to the Company's Knowledge threatened any discrimination, harassment, safety, health, wrongful termination or wage and hour
proceedings, or other claims, charges or complaints against or involving the Company or any Subsidiary
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before the National Labor Relations Board, the Occupational Safety & Health Administration (OSHA), the Department of Labor (DOL), the Equal Employment Opportunity Commission (EEOC), or any other governmental entity or arbitration proceeding and there are no facts or circumstances that would support such a
claim and (ii) there have been no actions, suits, proceedings, grievances, complaints or charges filed against the Company by any employees, former employees or prospective employees of the Company under any dispute resolution procedure (including, but not limited to, any proceedings under any dispute resolution procedure under any collective bargaining agreement).
(c) The Company has made all payments and withholdings of employment-related taxes and other employment-related sums as required by appropriate Governmental Authorities and has withheld and paid to the appropriate Governmental Authorities, or is holding for payment not yet due to such authorities, all amounts required to be withheld from employees of the Company and is not liable for any arrears of wages, taxes, penalties or other sums for failure to comply in all respects with any Laws relating to the foregoing.
(d) All obligations of the Company relating to its employees, whether arising by operation of law, by contract or past custom, for payments by the Company to trusts or other funds or to any governmental entity with respect to workers' compensation, unemployment compensation, social security or any other benefits for such employees with respect to employment of such employees have been paid or accrued on the Company's financial statements in accordance with GAAP. All obligations of the Company with
respect to such employees, whether arising by operation of law, by contract, by past custom or otherwise, for salaries, vacation and holiday pay, sick pay, bonuses, other forms of compensation or other benefits payable to such employees in respect of the services rendered by any of them have been paid or accrued on the Company's financial statements in accordance with GAAP.
(e) To the Knowledge of the Company, no employee or independent contractor of the Company is a party to, or is otherwise bound by, any contract, including any confidentiality, noncompetition, or proprietary rights agreement, between such employee and any other Person that in any way adversely affects (i) the performance of his or her duties as an employee or independent contractor of the Company, or (ii) the ability of the Company to conduct its business. No employee or independent contractor has threatened to terminate his or her service with the Company as a result of the transactions contemplated hereby or otherwise.
(f) The Company has made available to Buyer a true and complete list of the names and current salaries or compensation rates of all of the officers and other employees and independent contractors of the Company, and whether or not such Person is exempt or non-exempt.
(g) The Company is not in violation of any provision of any law promulgated by any Governmental Authority regarding the terms and conditions of employment or other labor-related matters, including without limitation laws relating to discrimination, harassment, fair labor standards and occupational health and safety, wrongful discharge or violation of the personal rights of employees, former employees or prospective employees of the Company.
Section 3.23 Officers and Directors. Schedule 3.23 hereto sets forth the name and title of each officer and director of the Company as of the date hereof.
Section 3.24 Bank Accounts. The Company has made available to Buyer a list of each bank in which the Company has an account, safe deposit box or lock box as of the date hereof and the number of each such account or box and each authorized signatory as of the date hereof.
ARTICLE 4
REPRESENTATIONS AND WARRANTIES OF THE BUYER
The Buyer represents and warrants as of the date hereof and as of the Closing that each statement contained in this Article 4 is correct and complete:
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