“Confidential Information” means (i) Company’s trade secrets, business plans, strategies, methods and/or practices; (ii) Company’s software, technology, computer systems architecture and network configurations; (iii) any other information relating to Company that is not generally known to the public, including information about Company’s personnel, products, customers, suppliers, financial information, marketing and pricing strategies, services or future business plans; (iv) material, non-public information related to Company; and (v) any and all analyses, compilations, studies, notes or other materials prepared which contain or are based on other Confidential Information of Company.

“Damages” means any loss, damage, or liability (joint or several) to which a Party hereto may become subject under the Securities Act, the Exchange Act, or other foreign, federal, state or local law, insofar as such loss, damage, or liability (or any action in respect thereof) arises out of or is based upon (i) any untrue statement or alleged untrue statement of a material fact contained in any registration statement of Company, including any preliminary prospectus or final prospectus contained therein or any amendments or supplements thereto; (ii) an omission or alleged omission to state therein a material fact required to be stated therein, or necessary to make the statements therein not misleading; or (iii) any violation or alleged violation by the indemnifying party (or any of its agents or Affiliates) of the Securities Act, the Exchange Act, any state or foreign securities law, or any rule or regulation promulgated under the Securities Act, the Exchange Act, or any state or foreign securities law; provided, however, that Damages shall not include any loss, damage, or liability resulting from use of a preliminary prospectus if the loss, damage, or liability arises after the Company makes a correcting preliminary or final prospectus available, and any such loss, damage, or liability would have been avoided by delivery of such correcting preliminary or final prospectus.

 

“Derivative Securities” means collectively the Convertible Note and the Warrant.

“Derivative Securities Purchase and Sale Agreement” means that certain Note and Warrant Sale Agreement dated as of the Effective Date by and among the Derivative Securities Sellers, Restricted Stockholder and Company.

“Designated Restricted Stockholder Affiliates” means Manatee, Galeb3, de Tezanos and Vargas.

“Excluded Registration” means (i) a registration relating to the sale of securities to employees of the Company or a subsidiary pursuant to a stock option, stock purchase, or similar plan; (ii) a registration relating to an SEC Rule 145 transaction; (iii) a registration on any form that does not include substantially the same information as would be required to be included in a registration statement covering the sale of the Restricted Securities; (iv) a registration in which the only Common Stock being registered is Common Stock issuable upon conversion of debt securities that are also being registered; or (v) a registration in which the only Company securities being registered are debt securities.

“Fair Market Value” means the average of the Market Values of the Common Stock for the thirty consecutive trading day period preceding the applicable date for the determination of the Fair Market Value, except in the case of subsection (iii) of the definition of Market Value, in which case Fair Market Value shall be Market Value determined as of the applicable date for determination of Fair Market Value.

 

“Immediate Family Member” means a child, stepchild, grandchild, parent, stepparent, grandparent, spouse, sibling, mother-in-law, father-in-law, son-in-law, daughter-in-law, brother-in-law, or sister-in-law, including adoptive relationships, of a natural person referred to herein.

“Initial Restricted Securities” means the Convertible Note Shares and the Warrant Shares.

 

"Market Value" means, with respect to the Common Stock as of any date, (i) the closing price of the Common Stock as reported on the principal U.S. national securities exchange on which the Common Stock is listed and traded on that date, or, if there is no closing price on that date, then on the last preceding date on which a closing price was reported; (ii) if the Common Stock is not listed on any U.S. national securities exchange but are quoted in an inter-dealer quotation system on a last sale basis, the final ask price of the Common Stock reported on the inter-dealer quotation system for such date, or, if there is no sale on that date, then on the last preceding date on which a sale was reported; or (iii) if the Common Stock is neither listed on a U.S. national securities exchange nor quoted on an inter-dealer quotation system on a last sale basis, the amount reasonably determined by the Company to be the fair market value of the Common Stock as determined by the Company in good faith and in light of all available information.

“Non-Restricted Securities” for the purposes of this Agreement, Non-Restricted Securities are Restricted Securities for which all of the Stock Restrictions have expired or terminated.

“Reply Period” means (i) ten (10) days if Restricted Stockholder is selling 147,526 Shares or less, (ii) thirty (30) days if Restricted Stockholder is selling more than 147,526 Shares but not more than 368,817 Shares, and (iii) sixty (60) days if Restricted Stockholder is selling more than 368,817 Shares.  For purposes of the determination of the applicable Reply Period, proposed Transfers shall be aggregated with all Transfers proposed during the six-month period preceding the most recent proposed Transfer. The foregoing Share numbers shall be adjusted proportionately in the event of a share split, combination or similar transaction of the Common Stock.

 

“Repurchase Option Event” means any Change in Control of Restricted Stockholder.

“Restricted Stockholder Disclosure Schedule” means Exhibit B attached hereto.

 

 

 

 

“Transfer” means (i) to sell, assign, lend; offer; pledge; contract to sell; sell any option or contract to purchase; purchase any option or contract to sell; grant any option, right, or warrant to purchase; or otherwise transfer or dispose of, directly or indirectly, any Shares or any securities convertible into or exercisable or exchangeable (directly or indirectly) for Shares or (ii) to enter into any swap or other arrangement that transfers to another, in whole or in part, any of the economic consequences of ownership of such securities, whether any such transaction described in clause (i) or this clause (ii) is to be settled by delivery of Shares or other securities, in cash, or otherwise; or (iii) any Change in Control of Restricted Stockholder.

 

“Warrant” means the Warrant to acquire shares of Common Stock issued by Company to the Derivative Securities Sellers and dated as of September 16, 2010.

“Warrant Shares” means the 400,000 shares of Common Stock issued upon the exercise of the Warrant.

2.1           Conversion of Convertible Note.

 

 

 

 

 

 

2.3           Issuance of Initial Restricted Securities. Promptly after the Effective Date, Company will deliver instructions to the Company’s transfer agent to issue the Initial Restricted Securities in book entry form to Restricted Stockholder.

 

2.4           Grant of NOL Plan Exemption. Subject to and in reliance upon the representations, warranties and obligations of Restricted Stockholder under this Agreement, the Board has granted Restricted Stockholder a NOL Plan Exemption solely with respect to Restricted Stockholder’s acquisition of the Derivative Securities and the Initial Restricted Securities. As long as Restricted Stockholder remains in full compliance with this Agreement, the Company shall maintain the NOL Plan Exemption in effect with respect to the Initial Restricted Securities. This NOL Plan Exemption is not applicable to the acquisition of Beneficial Ownership of any other or additional Shares by Restricted Stockholder or any of its Affiliates or Associates.

2.6           Legends. Restricted Securities shall be subject to and bear the legends set forth below together with (i) any other legends required by the securities laws of any state or other jurisdiction to the extent such laws are applicable to the Restricted Securities; and (ii) such other legends and restrictions as are applicable to the Common Stock generally.

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

                      (a)           If at any time the Company is eligible to use a Form S-3 registration statement, the Company receives a request in writing from Restricted Stockholder that the Company file a Form S-3 registration statement with respect to outstanding Restricted Securities held by Restricted Stockholder having an anticipated aggregate offering price, net of Selling Expenses, of at least five million dollars ($5,000,000.00), then the Company shall as soon as practicable, and in any event within ninety (90) days after the date such request is given by the Restricted Stockholder, file a Form S-3 registration statement under the Securities Act covering all Restricted Securities requested to be included in such registration by Restricted Stockholder, subject to the limitations of Section 4.1(b), 4.1(c), and Section 4.3. The Company shall use reasonable best efforts to cause such Form S-3 registration statement to be declared effective by the SEC as soon as practicable after filing.

(b)           Notwithstanding the foregoing obligations, if the Company furnishes to Restricted Stockholder a certificate signed by the Company’s chief executive officer stating that in the good faith judgment of the Board it would be materially detrimental to the Company and its stockholders for such registration statement to either become effective or remain effective for as long as such registration statement otherwise would be required to remain effective, because such action would: (i) materially interfere with a significant acquisition, corporate reorganization, or other similar transaction involving the Company; (ii) require premature disclosure of material information that the Company has a bona fide business purpose for preserving as confidential; or (iii) render the Company unable to comply with requirements under the Securities Act or Exchange Act, then the Company shall have the right to defer taking action with respect to such filing, and any time periods with respect to filing or effectiveness thereof shall be tolled correspondingly, for a period of not more than ninety (90) days after the request of Restricted Stockholder is given; provided, however, that the Company may not invoke this right more than once in any twelve (12) month period; and provided further that the Company shall not register any securities for its own account or that of any other stockholder during such ninety (90) day period other than an Excluded Registration.

 

(c)           The Company shall not be obligated to effect, or to take any action to effect, any registration pursuant to Section 4.1(a) (i) during the period that is ninety (90) days before the Company’s good faith estimate of the date of filing of, and ending on a date that is ninety (90) days after the effective date of, a Company-initiated registration, provided, that the Company is actively employing in good faith commercially reasonable efforts to cause such registration statement to become effective; or (ii) if the Company has effected a registration pursuant to Section 4.1(a) within the twelve (12) month period immediately preceding the date of such request.  A registration shall not be counted as “effected” for purposes of this Section 4.1(c) until such time as the applicable registration statement has been declared effective by the SEC, unless Restricted Stockholder withdraws its request for such registration, elects not to pay the registration expenses therefor, and forfeits its right to one demand registration statement pursuant to this Section 4.1 as provided in Section 4.6, in which case such withdrawn registration statement shall be counted as “effected” for purposes of this Section 4.1(c).

(d)           Restricted Stockholder shall only be entitled to two (2) demand registrations under this Section 4.1.

                      (a)           If, pursuant to Section 4.1, Restricted Stockholder intends to distribute Restricted Securities covered by its request by means of an underwriting, Restricted Stockholder shall so advise the Company as a part of its request made pursuant to Section 4.1.  The underwriter(s) will be selected by Restricted Stockholder subject to the reasonable approval of Company.  In such event, the right of Restricted Stockholder to include Restricted Stockholder’s Restricted Securities in such registration shall be conditioned upon Restricted Stockholder’s participation in such underwriting and the inclusion of Restricted Stockholder’s Restricted Securities in the underwriting to the extent provided herein.  Restricted Stockholder shall (together with the Company as provided in Section 4.4(e)) enter into an underwriting agreement in customary form with the underwriter(s) selected for such underwriting.  Notwithstanding any other provision of this Section 4.3, if the managing underwriter(s) advise(s) Restricted Stockholder in writing that marketing factors require a limitation on the number of shares to be underwritten, then the number of Restricted Securities that may be included in the underwriting shall be reduced to the number of Restricted Securities determined by the managing underwriter(s).

(b)           In connection with any offering involving an underwriting of shares of the Company’s capital stock pursuant to Section 4.2, the Company shall not be required to include any of Restricted Stockholder’s Restricted Securities in such underwriting unless Restricted Stockholder accepts the terms of the underwriting as agreed upon between the Company and the underwriters, and then only in such quantity as the underwriters in their sole discretion determine will not jeopardize the success of the offering by the Company.  If the total number of securities, including Restricted Securities, requested by stockholders to be included in such offering exceeds the number of securities to be sold (other than by the Company) that the underwriters in their reasonable discretion determine is compatible with the success of the offering, then the Company shall be required to include in the offering only that number of such securities, including Restricted Securities, which the underwriters and the Company in their sole discretion determine will not jeopardize the success of the offering.  If the managing underwriter(s) determine that less than all of the Restricted Securities requested to be registered can be included in such offering, then the Restricted Securities that are included in such offering shall be reduced to the number determined by the managing underwriter(s). Notwithstanding the foregoing, in no event shall the number of Restricted Securities included in the offering be reduced unless all other securities (other than securities to be sold by the Company) are first entirely excluded from the offering or, subject to Section 4.11, cutback proportionately with Other Registrable Securities (as defined in Section 4.11) requested to be registered.  For purposes of the provision in this Section 4.3(b) concerning apportionment, for any selling Restricted Stockholder that is a partnership, limited liability company, or corporation, the partners, members, retired partners, retired members, stockholders, and Affiliates of such Restricted Stockholder, or the estates and Immediate Family Members of any such partners, retired partners, members, and retired members and any trusts for the benefit of any of the foregoing Persons, shall be deemed to be a single “selling Restricted Stockholder,” and any pro rata reduction with respect to such “selling Restricted Stockholder” shall be based upon the aggregate number of Restricted Securities owned by all Persons included in such “selling Restricted Stockholder,” as defined in this sentence.

                      (c)           For purposes of Section 4.1, a registration shall not be counted as “effected” if, as a result of an exercise of the underwriter’s cutback provisions in Section 4.3(b), fewer than fifty percent (50%) of the total number of Restricted Securities that Restricted Stockholder has requested to be included in such registration statement are actually included.

(e)           in the event of any underwritten public offering, enter into and perform its obligations under an underwriting agreement, in usual and customary form, with the underwriter(s) of such offering;

(h)           promptly make available for inspection by Restricted Stockholder, any managing underwriter(s) participating in any disposition pursuant to such registration statement, and any attorney or accountant or other agent retained by any such underwriter or selected by Restricted Stockholder, all financial and other records, pertinent corporate documents, and properties of the Company, and cause the Company’s officers, directors, employees, and independent accountants to supply all information reasonably requested by any such seller, underwriter, attorney, accountant, or agent, in each case, as necessary or advisable to verify the accuracy of the information in such registration statement and to conduct appropriate due diligence in connection therewith;

4.6           Expenses of Registration.  All expenses (other than Selling Expenses) incurred in connection with registrations, including without limitation, those expenses for filings, or qualifications pursuant to Article IV, including all registration, filing, and qualification fees; printers’ and accounting fees; fees and expenses of compliance with securities laws or blue sky laws; and fees and disbursements of counsel for Company shall be borne and paid by Company; provided, however, that Company shall not be required to pay for any expenses of any registration proceeding begun pursuant to Section 4.1 if the registration request is subsequently withdrawn at the request of Restricted Stockholder (in which case Restricted Stockholder shall bear such expenses), unless Restricted Stockholder agrees to forfeit its right to one (1) registration pursuant to Section 4.1, as the case may be; provided further that if, at the time of such withdrawal, Restricted Stockholder has learned of a material adverse change in the condition, business, or prospects of Company from that known to Restricted Stockholders at the time of its request and has withdrawn the request with reasonable promptness after learning of such information, then Restricted Stockholder shall not be required to pay any of such expenses and shall not forfeit its right to one (1) registration pursuant to Section 4.1.  All Selling Expenses relating to Restricted Securities registered pursuant to this Article IV shall be borne and paid by Restricted Stockholder.

(a)           To the maximum extent permitted by applicable Law, Company will indemnify and hold harmless Restricted Stockholder, and the Affiliates, Associates, partners, members, officers, directors, and stockholders of Restricted Stockholder; legal counsel and accountants for Restricted Stockholder; any underwriter (as defined in the Securities Act) for Restricted Stockholder; and each Person, if any, who controls Restricted Stockholder or underwriter within the meaning of the Securities Act or the Exchange Act, against any Damages, and Company will pay to each such Restricted Stockholder, underwriter, controlling Person, or other aforementioned Person any legal or other expenses reasonably incurred thereby in connection with investigating or defending any Action or Proceeding from which Damages may result, as such expenses are incurred; provided, however, that the indemnity agreement contained in this Section 4.8(a) shall not apply to amounts paid in settlement of any such Action or Proceeding if such settlement is effected without the consent of the Company, which consent shall not be unreasonably withheld, nor shall the Company be liable for any Damages to the extent that they arise out of or are based upon actions or omissions made in reliance upon and in conformity with written information furnished by or on behalf of any such Restricted Stockholder, underwriter, controlling Person, or other aforementioned Person expressly for use in connection with such registration.

(b)           To the extent permitted by applicable Law, Restricted Stockholder will indemnify and hold harmless Company, and each of its directors, each of its officers who has signed the registration statement, each Person (if any), who controls Company within the meaning of the Securities Act, legal counsel and accountants for Company, any underwriter (as defined in the Securities Act), any other Person selling securities in such registration statement, and any controlling Person of any such underwriter or other selling Person, against any Damages, in each case only to the extent that such Damages arise out of or are based upon actions or omissions made in reliance upon and in conformity with written information furnished by or on behalf of Restricted Stockholder expressly for use in connection with such registration; and Restricted Stockholder will pay to Company and each other aforementioned Person any legal or other expenses reasonably incurred thereby in connection with investigating or defending any claim or proceeding from which Damages may result, as such expenses are incurred; provided, however, that the indemnity agreement contained in this Section 4.8(b) shall not apply to amounts paid in settlement of any such claim or proceeding if such settlement is effected without the consent of Restricted Stockholder, which consent shall not be unreasonably withheld; and provided further that in no event shall any indemnity under this Section 4.8(b) exceed the proceeds from the offering received by Restricted Stockholder (net of any Selling Expenses paid by Restricted Stockholder), except in the case of fraud or willful misconduct by Restricted Stockholder.

(c)           Promptly after receipt by an indemnified party under this Section 4.8 of notice of the commencement of any Action or Proceeding (including any governmental Action or Proceeding) for which a party may be entitled to indemnification hereunder, such indemnified party will, if a claim in respect thereof is to be made against any indemnifying party under this Section 4.8, give the indemnifying party notice of the commencement thereof.  The indemnifying party shall have the right to participate in such Action or Proceeding and, to the extent the indemnifying party so desires, participate jointly with any other indemnifying party to which notice has been given, and to assume the defense thereof with counsel mutually satisfactory to the parties; provided, however, that an indemnified party (together with all other indemnified parties that may be represented without conflict by one counsel) shall have the right to retain one (1) separate counsel, with the fees and expenses to be paid by the indemnifying party, if representation of such indemnified party by the counsel retained by the indemnifying party would be inappropriate due to actual or potential differing interests between such indemnified party and any other party represented by such counsel in such action.  Failure to give notice to the indemnifying party within a reasonable time of the commencement of any such action shall not relieve such indemnifying party of any liability to the indemnified party under this Section 4.8, to the extent that such failure does not materially prejudice the indemnifying party’s ability to defend such action.

 

(d)           Notwithstanding anything else herein to the contrary, the foregoing indemnity agreements of Company and Restricted Stockholder are subject to the condition that, insofar as they relate to any Damages arising from any untrue statement or alleged untrue statement of a material fact contained in, or omission or alleged omission of a material fact from, a preliminary prospectus (or necessary to make the statements therein not misleading) that has been corrected in the form of prospectus included in the registration statement at the time it becomes effective, or any amendment or supplement thereto filed with the SEC pursuant to Rule 424(b) under the Securities Act (“Final Prospectus”), such indemnity agreement shall not inure to the benefit of any Person if a copy of the Final Prospectus was furnished to the indemnified party and such indemnified party failed to deliver, at or before the confirmation of the sale of the shares registered in such offering, a copy of the Final Prospectus to the Person asserting the loss, liability, claim, or damage in any case in which such delivery was required by the Securities Act.

 

(e)           To provide for just and equitable contribution to joint liability under the Securities Act in any case in which either (i) any party otherwise entitled to indemnification hereunder makes a claim for indemnification pursuant to this Section 4.8 but it is judicially determined (by the entry of a final judgment or decree by a court of competent jurisdiction and the expiration of time to appeal or the denial of the last right of appeal) that such indemnification may not be enforced in such case, notwithstanding the fact that this Section 4.8 provides for indemnification in such case, or (ii) contribution under the Securities Act may be required on the part of any party hereto for which indemnification is provided under this Section 4.8, then, and in each such case, such parties will contribute to the aggregate losses, claims, damages, liabilities, or expenses to which they may be subject (after contribution from others) in such proportion as is appropriate to reflect the relative fault of each of the indemnifying party and the indemnified party in connection with the statements, omissions, or other actions that resulted in such loss, claim, damage, liability, or expense, as well as to reflect any other relevant equitable considerations.  The relative fault of the indemnifying party and of the indemnified party shall be determined by reference to, among other things, whether the untrue or allegedly untrue statement of a material fact, or the omission or alleged omission of a material fact, relates to information supplied by the indemnifying party or by the indemnified party and the parties’ relative intent, knowledge, access to information, and opportunity to correct or prevent such statement or omission; provided, however, that, in any such case, (x) Restricted Stockholder will not be required to contribute any amount in excess of the public offering price of all Restricted Securities offered and sold by Restricted Stockholder pursuant to such registration statement except in the case of willful misconduct or fraud, and (y) no Person guilty of fraudulent misrepresentation (within the meaning of Section 11(f) of the Securities Act) will be entitled to contribution from any Person who was not guilty of such fraudulent misrepresentation; and provided further that in no event shall Restricted Stockholder’s liability pursuant to this Section 4.8(e), when combined with the amounts paid or payable by Restricted Stockholder pursuant to Section 4.8(b), exceed the proceeds from the offering received by Restricted Stockholder (net of any Selling Expenses paid by Restricted Stockholder), except in the case of willful misconduct or fraud by Restricted Stockholder.

(g)           Unless otherwise superseded by an underwriting agreement entered into in connection with the underwritten public offering, the obligations of Company and Restricted Stockholder under this Section 4.8 shall survive the completion of any offering of Restricted Securities in a registration under this Article IV, and otherwise shall survive the termination of this Agreement.

                    (a)           make and keep available adequate current public information, as those terms are understood and defined in SEC Rule 144;

(c)           furnish to Restricted Stockholder, so long as Restricted Stockholder owns any Restricted Securities, forthwith upon request (i) to the extent accurate, a written statement by the Company that it has complied with the reporting requirements of SEC Rule 144, the Securities Act, and the Exchange Act, or that it qualifies as a registrant whose securities may be resold pursuant to Form S-3 (at any time after Company so qualifies); (ii) a copy of the most recent annual or quarterly report of Company and such other reports and documents so filed by Company; and (iii) such other information as may be reasonably requested in availing Restricted Stockholder of any rule or regulation of the SEC that permits the selling of any such securities without registration (at any time after the Company has become subject to the reporting requirements under the Exchange Act) or pursuant to Form S-3 (at any time after Company so qualifies to use such form).

 

4.10           “Market Stand-off” Agreement.  Restricted Stockholder hereby agrees that it will not, without the prior written consent of the managing underwriter(s), during the period commencing on the date of the final prospectus relating to a registration of equity securities of Company under the Securities Act and ending on the date specified by Company and the managing underwriter(s) (such period not to exceed (x) one hundred eighty (180) days, which period may be extended upon the request of the managing underwriter(s) for an additional period of up to fifteen (15) days if Company issues or proposes to issue an earnings or other public release within fifteen (15) days of the expiration of the 180-day lockup period), Transfer any Shares held immediately before the effective date of the registration statement for such offering.  The foregoing provisions of this Section 4.10 shall not apply to the sale of any securities to an underwriter pursuant to an underwriting agreement.  The underwriters in connection with such registration are intended third-party beneficiaries of this Section 4.10 and shall have the right, power, and authority to enforce the provisions hereof as though they were a party hereto.  Restricted Stockholder further agrees to execute such agreements as may be reasonably requested by the underwriters in connection with such registration that are consistent with this Section 4.10 or that are necessary to give further effect thereto.

 

 

(a)           Restricted Stockholder understands that Restricted Securities have not been, and will not be, registered under the Securities Act, by reason of a specific exemption from the registration provisions of the Securities Act which depends upon, among other things, the bona fide nature of the investment intent and the accuracy of Restricted Stockholder’s representations and warranties made in this Agreement.  Restricted Stockholder understands that the Restricted Securities are “restricted securities” under applicable U.S. federal and state securities Laws and that, pursuant to these Laws, Restricted Stockholder must hold the Restricted Securities indefinitely unless they are registered with the SEC and qualified by state authorities or an exemption from such registration and qualification requirements is available.  Restricted Stockholder acknowledges that Company has no obligation to register or qualify the Restricted Securities for resale except as set forth in this Agreement.  Restricted Stockholder further acknowledges that if an exemption from registration or qualification is available, it may be conditioned on various requirements including, but not limited to, the time and manner of sale, the holding period for the Restricted Securities, and on requirements relating to Company which are outside of Restricted Stockholder’s or Company’s control, and which Company is under no obligation and may not be able to satisfy.

 

5.4           Limitation on Number of Transfers of Restricted Securities. Notwithstanding any other provision of this Agreement, the number of Restricted Securities that may be resold or otherwise Transferred to the public or through any public securities trading market at any time may not exceed the volume limitations contained in SEC Rule 144.  The number of Restricted Securities that may be sold pursuant to a registered offering under Article IV of this Agreement shall be determined among the Company, Restricted Stockholder and the applicable underwriters in accordance with Article IV.

(b)           The restrictions on Transfers contained in this Article V shall not prohibit any Transfers of Shares by Restricted Stockholder to the acquirer in connection with any Change in Control of the Company that has been approved by the Board and such Transfer is made in accordance with the terms and conditions of the Board-approved transaction agreement that provides for the Transfer of shares of Common Stock of the Company to the acquirer by all holders of the Company’s Common Stock on the same basis.

5.8           Termination of Remaining Restrictions.  Any and all remaining restrictions on Transfers set forth in this Article Vthat have not already terminated or expired according to any other more specific terms herein shall terminate on the fifth anniversary of the Effective Date, except that the provisions of Sections 5.1 and 5.5 shall remain in effect beyond such termination date for all proposed Transfers.

 

 

8.1           Agreement to Standstill. Neither Restricted Stockholder nor any of its Affiliates or Associates will, without the prior written consent of the Company (i) acquire, offer to acquire, propose (whether publicly or otherwise) to acquire, announce any intention to effect or cause or participate in or in any way assist or encourage any other person to effect or seek, offer or propose (whether publicly or otherwise) to acquire or agree to acquire, directly or indirectly, by purchase or otherwise, any securities (or beneficial ownership thereof) or direct or indirect rights to acquire any securities of the Company or any subsidiary thereof, or of any successor to or person in control of the Company, or any assets of the Company or any subsidiary or division thereof or of any such successor or controlling person; (ii) participate in (1) any tender or exchange offer, merger or other business combination involving the Company or any of its affiliates; (2) any recapitalization, restructuring, liquidation, dissolution or other extraordinary transaction with respect to the Company or any of its affiliates; or (3) any "solicitation" of "proxies" (as such terms are used in the proxy rules of the Securities and Exchange Commission) or consents to vote any voting securities of the Company or any of its affiliates; (iii) form, join or in any way participate in a "group" as defined in Section 13(d)(3) of the Securities Exchange Act of 1934, as amended, in connection with any of the foregoing; (iv) otherwise act, alone or in concert with others, to seek to control or influence the management, Board or policies of the Company or any of its affiliates; (v) nominate or seek to nominate any person to the Board or otherwise act, alone or in concert with others, to seek to control or influence the management, the Board or policies of the Company; (vi) take any action which might force the Company to make a public announcement regarding any of the types of matters set forth in clauses (i)-(v)  above; or (vii) enter into any discussions or arrangements with any third party with respect to any of the foregoing.

 

 

 

 

11.7           Severability.  Each term, covenant, condition, or provision of this Agreement will be viewed as separate and distinct, and in the event that any such term, covenant, condition or provision will be deemed to be invalid or unenforceable, the arbitrator or court finding such invalidity or unenforceability will modify or reform this Agreement to give as much effect as possible to the terms and provisions of this Agreement.  Any term or provision which cannot be so modified or reformed will be deleted and the remaining terms and provisions will continue in full force and effect.

 

Company	Autobytel Inc.
	By:	/s/ Glenn E. Fuller
		Glenn E. Fuller
		Executive Vice President, Chief Legal and Administrative Officer and Secretary

 

 

 

 

[SIGNATURE PAGE TO STOCKHOLDER AGREEMENT]

 

 

 

 

 

 

 

 

 

By:	_____________________________

Matías de Tezanos, Co-Managing

Director and President