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Exhibit 10.55
   

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____________________
 
STOCK PURCHASE AGREEMENT
 
____________________
 
among
 
WebMediaBrands Inc.,
 

 
Certain Stockholders of Inside Network, Inc.
 

 
and
 

 
Justin L. Smith

(as “Stockholder Representative”)
 

 
Dated as of
 
May 11, 2011
 

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TABLE OF CONTENTS

  Page 
ARTICLE I DEFINITIONS
1
1.1
Certain Defined Terms
1
1.2
Interpretation and Rules of Construction
10
   
ARTICLE II CLOSING; CONSIDERATION
11
2.1
Closing
11
2.2
Stockholder and Company Closing Deliveries
11
2.3
Purchaser Closing Deliveries
12
2.4
Purchase Price
12
2.5
Payment of Purchase Price
12
   
ARTICLE III REPRESENTATIONS AND WARRANTIES REGARDING THE COMPANY
13
3.1
Due Organization; Power; No Subsidiaries; Etc.
13
3.2
Capitalization
13
3.3
No Conflict; Third Party Consents
14
3.4
Financial Statements
14
3.5
Absence of Changes
15
3.6
No Undisclosed Liabilities
17
3.7
Receivables; Major Customers
17
3.8
Tangible Assets
17
3.9
Leasehold Property
17
3.10
Intellectual Property; Privacy
18
3.11
Contracts
20
3.12
Liabilities; Major Suppliers
21
3.13
Compliance With Legal Requirements
22
3.14
Governmental Authorizations
22
3.15
Tax Matters
23
3.16
Employee and Labor Matters
24
3.17
Employee Benefit Plans and Compensation
25
3.18
Environmental Matters
26
3.19
Insurance
27
3.20
Related Party Transactions
27
3.21
Proceedings; Orders
27
3.22
List of Active Clients and Advertisers
28
3.23
Brokers
28
3.24
Full Disclosure
28
   
ARTICLE IV REPRESENTATIONS AND WARRANTIES OF EACH STOCKHOLDER
29
4.1
Due Organization
29
4.2
Ownership; Title to Shares
29
4.3
Due Authorization
30
4.4
No Conflict; Third Party Consents
30
4.5
Brokers
30
4.6
Investment Representations and Warranties
30

 
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ARTICLE V REPRESENTATIONS AND WARRANTIES OF PURCHASER
32
5.1
Due Organization
32
5.2
Due Authorization
32
5.3
No Conflict; Third Party Consents
32
5.4
Capitalization
33
5.5
SEC Filings; Financial Statements
33
5.6
Proceedings; Orders
34
5.7
Licenses And Permits; Compliance With Laws
34
5.8
Valid Issuances
34
5.9
Brokers
34
5.10
Purchase for Own Account
34
   
ARTICLE VI ADDITIONAL AGREEMENTS
35
6.1
Access to Information
35
6.2
Confidentiality
35
6.3
Further Action
36
6.4
Production of Witnesses and Individuals; Privilege Matters
36
6.5
Public Disclosure
37
6.6
Release
37
   
ARTICLE VII TAXES
38
7.1
Tax Periods Ending on or Before the Effective Date
38
7.2
Proration of Personal Property Taxes
38
7.3
Payment of Taxes
38
7.4
Cooperation on Tax Matters
38
7.5
Transfer Taxes
38
7.6
Retention of Tax Records
39
7.7
Stockholder Review
39
   
ARTICLE VIII CONDITIONS TO CLOSING
39
8.1
Conditions to Each Party’s Obligations
39
8.2
Additional Conditions to the Obligations of the Stockholder
40
8.3
Additional Conditions to Obligations of Purchaser
40

 
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ARTICLE IX INDEMNIFICATION
41
9.1
Survival of Representations and Warranties
41
9.2
Indemnification by Stockholders
41
9.3
Indemnification by Purchaser
42
9.4
Limits on Indemnification
42
9.5
Notice of Loss
44
9.6
Third Party Claims
45
9.7
Exclusive Remedy
46
9.8
Characterization of Indemnification Payments
46
   
ARTICLE X REGISTRATION RIGHTS
46
10.1
Form S-3 Registration
46
10.2
Obligations of the Purchaser
47
10.3
Furnish Information
47
10.4
Indemnification
47
10.5
Termination of Purchaser’s Obligations
49
   
ARTICLE XI STOCKHOLDER REPRESENTATIVE
50
11.1
Stockholder Representative
50
   
ARTICLE XII GENERAL PROVISIONS
51
12.1
Notices
51
12.2
Severability
52
12.3
Entire Agreement
52
12.4
Assignment
53
12.5
Amendment
53
12.6
Waiver
53
12.7
No Third Party Beneficiaries
53
12.8
Currency
53
12.9
Governing Law
53
12.10
Waiver of Jury Trial
53
12.11
Counterparts
53
12.12
Further Assurances
54
12.13
Fees and Expenses
54
12.14
Attorney Fees
54
12.15
Specific Performance
54
           
EXHIBITS
 
EXHIBIT A
Disclosure Schedule
 
EXHIBIT B
Escrow Agreement
 
EXHIBIT C
Form of Restricted Stock Purchase Agreement
       
SCHEDULES
 
SCHEDULE 2.5
Stockholders
 

 

 
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STOCK PURCHASE AGREEMENT
 
THIS STOCK PURCHASE AGREEMENT is made and entered into as of May 11, 2011 (the
“Effective Date”), by and among WebMediaBrands Inc., a Delaware corporation (the
“Purchaser”), and the stockholders of Inside Network, Inc., a California
corporation (f/k/a Prophetic Media, LLC, a California limited liability company,
the “Company”), set forth on the signature pages hereto (individually, a
“Stockholder,” and collectively, the “Stockholders”), and Justin L. Smith (the
“Stockholder Representative”). The Purchaser, the Stockholders and the
Stockholder Representative are sometimes referred to herein individually as a
“Party” and collectively as the “Parties”.
 
RECITALS
 
WHEREAS, the Stockholders and the Restricted Stockholders (as defined herein)
own all of the issued and outstanding shares of capital stock of the Company
(the “Shares”); and
 
WHEREAS, upon the terms and conditions set forth herein and in the Restricted
Stock Purchase Agreements (as defined below), the Stockholders and the
Restricted Stockholders propose to sell to the Purchaser and the Purchaser
proposes to purchase from the Stockholders and the Restricted Stockholders, all
of the Shares in exchange for the consideration set forth herein.
 
NOW, THEREFORE, in consideration of the respective covenants, agreements and
representations and warranties set forth herein, the Parties to this Agreement,
intending to be legally bound, agree as follows:
 
ARTICLE I
DEFINITIONS
  
1.1   Certain Defined Terms. For purposes of this Agreement:
 
“Advertiser” means a Person who is a party to any Advertising Agreement.
 
“Advertising Agreements” means advertising contracts and insertion orders
whereby advertisers or their agents purchase the right to place advertising on
(or the right to receive leads generated from) one or more of the Websites, or
purchase advertising in connection with any Tradeshow.
 
“Agreement” shall have the meaning set forth in the Preamble to this Agreement.
 
“Affiliate” means, with respect to any specified Person, any other Person that
directly, or indirectly through one or more intermediaries, controls, is
controlled by, or is under common control with, such specified Person.
 
“Ancillary Agreements” means the Escrow Agreement, the Restricted Stock Purchase
Agreements and the Stockholder Closing Certificate.
 
“Assets” of any Person means all of such Person’s right, title and interest in
and to all assets and properties of every kind, nature, character and
description (whether real, personal or mixed, whether tangible or intangible and
wherever situated), including Contracts and Intellectual Property.
 
“Basket” shall have the meaning set forth in Section 9.4(b)(ii) of this
Agreement.
 
“Breach” of a representation, warranty, covenant, obligation or other provision
means there is or has been any inaccuracy in or breach of, or any failure to
comply with or perform, such representation, warranty, covenant, obligation or
other provision.
 
“Business” means specifically the business and operations of the Company
including, without limitation, the Websites, Tradeshows, Research Services and
Company Products, as conducted and planned prior to, and as of the Closing.
  
 
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“Business Day” means any day that is not a Saturday, a Sunday or a scheduled
holiday of the Federal Reserve Bank of New York.
 
“Business Records” means the Company’s accounting, business, customer,
advertiser, financial, legal and Tax records.
 
“Cash” means cash and cash equivalents (including marketable securities and
short term investments).
 
“Cash Consideration” shall have the meaning set forth in Section 2.4 of this
Agreement.
 
“Cash Escrow Amount” shall have the meaning set forth in Section 2.5(a) of this
Agreement.
 
“CERCLA” shall mean the Comprehensive Environmental Response, Compensation and
Liability Act, as amended.
 
“Client Agreement” means any Contract or license (written or oral) between a
Person and the Company pursuant to which such Person obtains Company Products
from the Company.
 
“Clients” means a Person who is a party to any Client Agreement.
 
“Closing” shall have the meaning set forth in Section 2.1 of this Agreement.
 
“Closing Cash” shall mean the amount of cash held by the Company as of the
Closing, minus the amount of $402,811.31 to be retained by the Company for
post-Closing working capital; such Closing Cash shall be included in the
Purchase Price and transferred to the Stockholders at Closing.
 
“Closing Withholdings” shall mean amounts of Taxes required to be paid or
withheld by the Company for income or employment Taxes with respect to the
vesting of the Restricted Stockholders’ capital stock of the Company prior to
the Closing, as well as any amounts of income or employment Taxes required to be
withheld by the Company or the Purchaser with respect to the transactions
contemplated under this Agreement and the Restricted Stock Purchase Agreements.
 
 “COBRA” shall mean the Consolidated Omnibus Budget Reconciliation Act of 1985,
as amended.
 
“Code” means the Internal Revenue Code of 1986, as amended through the date
hereof.
 
“Company” shall have the meaning set forth in the Preamble to this Agreement.
 
“Company Common Stock” shall have the meaning set forth in Section 3.2(a) of
this Agreement.
 
“Company Contractor/Freelancer” means each Person who, as a freelance writer,
editor or publisher or independent contractor or consultant, is providing, or
has provided, at any time prior to the Closing, services to the Company, a
complete list of such Persons being set forth in Section 1.1 of the Disclosure
Schedule.
 
“Company Contracts” means all Contracts of the Company or any Affiliate of the
Company including, without limitation, all Advertising Agreements, Client
Agreements, Subscription Agreements, Media Buying Agreements, customer
agreements, partner agreements, insertion orders, license agreements, hosting
agreements and Contracts entered into by the Company in connection with its
Business.
 
“Company Employee” means any current employee of the Company.
 
“Company Employee Plan” shall mean any plan, program, policy, practice, Contract
or other arrangement providing for compensation, severance, termination pay,
deferred compensation, performance awards, stock or stock-related awards, fringe
benefits or other employee benefits or remuneration of any kind, whether
written, unwritten or otherwise, funded or unfunded, including each “employee
benefit plan,” within the meaning of Section 3(3) of ERISA (whether or not ERISA
is applicable to such plan), that is or in the last six years has been
maintained, contributed to, or required to be contributed to, by the Company or
any ERISA Affiliate for the benefit of any Company Employee or former Company
Employee, or with respect to which the Company or any ERISA Affiliate has or may
have any liability or obligation with respect to the Company, except such
definition shall not include any Employee Agreement.
  
 
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“Company Financial Statements” shall have the meaning set forth in
Section 3.4(a) of this Agreement.
 
“Company Governmental Authorizations” shall have the meaning set forth in
Section 3.14(a).
 
“Company IP” shall mean all Intellectual Property Rights owned (whether
exclusively, jointly with another Person, or otherwise) by the Company,
including all Intellectual Property Rights in or pertaining to the Company
Products and all Company Website Content owned by the Company.
 
“Company IP Contract” shall mean any Company Contract to which the Company is a
party or by which the Company is bound, which contains any assignment or license
of, or covenant not to assert or enforce, any Intellectual Property Right or
that relates to any Company IP.
 
“Company Privacy Policy” means each privacy policy of the Company in effect at
any time, including any policy relating to (i) the privacy of users of the
Company Products or of any of the Websites or (ii) the collection, storage,
disclosure and transfer of any User Data or Personal Data.
 
“Company Product” shall mean any product or service that is (i) marketed,
distributed, licensed or sold by or on behalf of the Company or (ii) currently
under development by or on behalf of the Company and intended by the Company to
be marketed, distributed, licensed or sold by or on behalf of the Company in
connection with its business as presently conducted or presently intended to be
conducted in the future, including without limitation all of the Company’s
Websites, Tradeshows and Research Services.
 
“Company Rights” shall have the meaning set forth in Section 3.2(c) of this
Agreement.
 
“Company Software” shall have the meaning set forth in Section 3.10(l) of this
Agreement.
 
“Company Tangible Property” means all of the Company’s furniture, fixtures,
improvements, equipment, computers, computer hardware (including computer
servers), computer software, office equipment and apparatuses, tools, machinery
and other tangible property of every kind (wherever located, whether or not
carried on the Business Records and whether or not leased), other than office
supplies and tangible property which individually or in the aggregate have de
minimis value, together with any express or implied warranty by the
manufacturers, sellers or lessors of any item or component part thereof and all
maintenance records and other documents relating thereto.
 
“Company Trademarks” shall have the meaning set forth in Section 3.10(h)(ii) of
this Agreement.
 
“Company Website Content” means all content on the Websites (whether placed
thereon by the Company, users or other third parties).
 
“Confidential Information” shall have the meaning set forth in Section 6.2(a) of
this Agreement.
 
“Contract” means any legally binding agreement, written commitment, arrangement,
lease, license, understanding or contract.
 
“Control” (including the terms “controlled by” and “under common control with”),
with respect to the relationship between or among two or more Persons, means the
possession, directly or indirectly or as trustee, personal representative or
executor, of the power to direct or cause the direction of the affairs or
management of a Person, whether through the ownership of voting securities, as
trustee, personal representative or executor, by Contract, credit arrangement or
otherwise.
  
 
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“Copyrights” means all works of authorship, including without limitation all
content, data, text, graphics, writings, images, photographs, designs and all
copyrights (whether registered or unregistered) therein.
 
“Current Liabilities” means the Company’s current liabilities, as determined
pursuant to cash accounting practices historically used by the Company, as
applied on a consistent basis; provided that, with respect to Section 3.5(f)
hereof, such current liabilities will be determined pursuant to GAAP.
 
“Databases” means all proprietary databases and other data sets and
compilations, whether written, electronic or in another form, and all
documentation relating to the foregoing, including manuals, memoranda and
records.
 
“Disclosure Schedule” means the Disclosure Schedule attached hereto as
Exhibit A, dated as of the date hereof.
 
“Domain Name” means the URLs, Domain Names and registrations or applications for
registration thereof as listed on Section 1.1 of the Disclosure Schedule and all
Intellectual Property used in connection therewith.
 
“Effective Date” shall have the meaning set forth in the Preamble to this
Agreement.
 
“Employee Agreement” shall mean each management, employment, severance,
consulting, relocation, repatriation or expatriation agreement or other Contract
between the Company or any ERISA Affiliate and any Company Employee.
 
“Employment and Non-Competition Agreement” shall mean that certain Employment
Agreement dated and effective as of the Effective Date between Justin L. Smith
and the Purchaser.
 
“Encumbrance” means any security interest, pledge, hypothecation, mortgage,
lien, lease, license, option, exception, reservation, limitation, impairment,
imperfection of title, condition or restriction of any nature or similar
encumbrance.
 
“ERISA” means the Employee Retirement Income Security Act of 1974, as amended.
 
“ERISA Affiliate” means any other corporation or trade or business controlled
by, controlling or under common control with the Company (within the meaning of
Section 414 of the Code or Section 4001(a)(14) or 4001(b) of ERISA).
 
“Escrow Account” shall mean the account maintained by the Escrow Agent on behalf
of the Parties pursuant to the Escrow Agreement.
 
“Escrow Agent” shall mean JPMorgan Chase Bank, National Association.
 
“Escrow Agreement” shall mean that certain Escrow Agreement dated as of the
Effective Date among the Purchaser, the Stockholder Representative and the
Escrow Agent in substantially the form attached hereto Exhibit B.
 
“Exchange Act” means the Securities Exchange Act of 1934, as amended.
 
“Form S-3” means such form under the Act as is in effect on the date hereof or
any successor registration form under the Act subsequently adopted by the SEC
that permits inclusion or incorporation of substantial information by reference
to other documents filed by the Purchaser with the SEC.
 
“GAAP” means United States generally accepted accounting principles in effect in
the United States at the time of application thereof, applied on a consistent
basis.
  
 
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“Governmental Authority” means any federal, national, supranational, state,
provincial, local, foreign or other government, governmental, regulatory or
administrative authority, agency or commission or any court, tribunal, or
judicial or arbitral body with applicable jurisdiction.
 
“Governmental Authorization” shall mean any: (a) permit, license, certificate,
franchise, concession, approval, consent, ratification, permission, clearance,
confirmation, endorsement, waiver, certification, designation, rating,
registration, qualification or authorization that is, has been or may in the
future be issued, granted, given or otherwise made available by or under the
authority of any Governmental Authority or pursuant to any Legal Requirement; or
(b) right under any Contract with any Governmental Authority.
 
“Governmental Order” means any order, writ, judgment, injunction, decree,
stipulation, determination or award entered by or with any Governmental
Authority.
 
“Hazardous Material” includes: (a) any petroleum, waste oil, crude oil,
asbestos, urea formaldehyde or polychlorinated biphenyl; (b) any waste, gas or
other substance or material that is explosive or radioactive; (c) any “hazardous
substance,” “pollutant,” “contaminant,” “hazardous waste,” “regulated
substance,” “hazardous chemical” or “toxic chemical” as designated, listed or
defined (whether expressly or by reference) in any statute, regulation or other
Legal Requirement (including CERCLA, any other so called “superfund” or
“superlien” law, the Resource Conservation Recovery Act, the Federal Water
Pollution Control Act, the Toxic Substances Control Act, the Emergency Planning
and Community Right to Know Act and the respective regulations promulgated
thereunder) or (d) any other substance or material (regardless of physical form)
or form of energy that, due to its hazardous characteristics, is subject to any
Legal Requirement which regulates or establishes standards of conduct in
connection with, or which otherwise relates to, the protection of human health
or the environment.
 
“Holders” shall mean holders of Registrable Securities.
 
“Indemnification Claim Dispute” shall have the meaning set forth in
Section 9.5(c) of this Agreement.
 
“Indemnification Claim Notice” shall have the meaning set forth in
Section 9.5(a) of this Agreement.
 
“Indemnified Party” means a Purchaser Indemnified Party or a Stockholder
Indemnified Party, as the case may be.
 
“Indemnifying Party” means the Stockholders pursuant to Section 9.2 and the
Purchaser pursuant to Section 9.3, as the case may be.
 
“Intellectual Property” shall mean all of the following to the extent owned,
used or licensed by the Company: (i) Marks; (ii) Patents; (iii) Trade Secrets
(iv) Copyrights; (v) domain names and URLs; (vi) confidential information,
customer data and database rights; (vii) books and records describing or used in
connection with any of the foregoing; (viii) all rights under agreements
relating to any of the foregoing; and (ix) claims or causes of action arising
out of or related to infringement or misappropriation of any of the foregoing.
 
“Internet Properties” means all rights to the Company’s URLs, Domain Names and
Websites.
 
“IRS” means the United States Internal Revenue Service.
 
“Knowledge of the Company” or similar terms used in this Agreement means any
fact, matter or circumstance of which Justin L. Smith or Eric Eldon have actual
knowledge after due inquiry.
 
“Knowledge of the Purchaser” or similar terms used in this Agreement means any
fact, matter or circumstance of which Alan Meckler, Don O’Neill or Mitch
Eisenberg had actual knowledge after due inquiry.
  
 
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“Leased Real Property” means the real property leased by the Company as tenant
together with, to the extent leased by the Company, all buildings and other
structures, facilities or improvements currently or hereafter located thereon,
and all easements, licenses, rights and appurtenances relating to the foregoing.
 
“Legal Requirement” shall mean any federal, state, local, municipal, foreign or
other law, statute, legislation, constitution, principle of common law,
resolution, ordinance, code, edict, decree, proclamation, treaty, convention,
rule, regulation, ruling, directive, pronouncement, requirement, specification,
determination, decision, opinion or interpretation.
 
“Liabilities” means any and all debts, liabilities and obligations, whether
accrued or fixed, absolute or contingent, matured or unmatured or determined or
determinable, including those arising under any Legal Requirement, Proceeding or
Governmental Order and those arising under any Contract, arrangement, commitment
or undertaking, and including all costs and expenses relating thereto, including
all reasonable fees, disbursements, expenses of legal counsel, experts and
consultants.
 
“Loss” shall have the meaning set forth in Section 9.2 of this Agreement.
 
“Material Adverse Effect” means any circumstance, change, event, development or
effect that is, individually or in the aggregate, material and adverse to
(a) the Company’s financial condition, assets, liabilities, or business
operations, taken as a whole or (b) the ability of the Stockholders to
consummate the Transactions; provided, however, that none of the following shall
be deemed to constitute, or be taken into account in determining whether there
has been, a Material Adverse Effect: (x) changes in conditions in the U.S. or
global economy or capital or financial markets generally, including changes in
interest or exchange rates, or (y) changes after the date hereof in the industry
in which the Company operates (but only if with respect to the foregoing effects
in (x) or (y), the Company is not disproportionately affected thereby relative
to other Persons in the industry in which the Company is engaged).
 
“Media Buying Agreements” means advertising contracts and insertion orders
whereby the Company purchases the right to place advertising on (or the right to
receive leads generated from) one or more third-party websites, publications or
other medium.
 
“Open Source Code” means any software code that is distributed as “free
software” or “open source software” or is otherwise distributed publicly in
source code form under terms that permit modification and redistribution of such
software. Open Source Code includes software code that is licensed under the GNU
General Public License, GNU Lesser General Public License, Mozilla License,
Common Public License, Apache License, BSD License, Artistic License, or Sun
Community Source License.
 
“Ordinary Course of Business” means, with respect to the operation by the
Company of its business, the operation thereof in the ordinary course of
business consistent with prior practices with respect to the operation thereof.
 
“Organizational Documents” means with respect to a particular Person, the
limited liability company agreement, limited partnership agreement, partnership
agreement, certificate of formation, certificate or articles of incorporation,
bylaws or any other similar organizational document of such Person.
 
“Patents” means all patents, patentable inventions, discoveries, improvements,
ideas, know-how, processes and all patent applications and registrations.
 
“Party” and “Parties” shall have the meanings set forth in the Preamble to this
Agreement.
  
 
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“Permitted Encumbrances” means (a) Encumbrances for Taxes and other governmental
charges and assessments that are (i) not yet due and payable or (ii) being
contested by appropriate proceedings in good faith, in the case of clause (ii),
for which an appropriate reserve has been established on the Company Financial
Statements in accordance with GAAP, (b) statutory Encumbrances of landlords,
lessors, carriers, warehousemen, mechanics and materialmen and other similar
statutory Encumbrances imposed by Legal Requirements, in each case that are
arising in the Ordinary Course of Business, that are not material individually
or in the aggregate to the Company and, secure obligations not more than 60 days
past due, (c) Encumbrances created by this Agreement or any of the Ancillary
Agreements, or in connection with the Transactions, or by the actions of the
Purchaser and (d) Encumbrances set forth in Section 1.1 of the Disclosure
Schedule.
 
“Person” means any individual, partnership, firm, corporation, limited liability
company, association, trust, unincorporated organization or other entity, as
well as any syndicate or group that would be deemed to be a person under
Section 13(d)(3) of the Exchange Act.
 
“Personal Data” shall mean a natural person’s name, street address, telephone
number, e-mail address, photograph, social security number, driver’s license
number, passport number, or customer or account number, or any other piece of
information that allows the identification of a natural person.
 
“Prior Indebtedness” means any indebtedness of the Company including with
respect to (a) borrowed money, (b) notes payable, (c) capital leases, and
(d) installment sale Contracts or other Contracts, relating to the deferred and
unpaid purchase price of property or services, including any interest accrued
thereon and prepayment, change of control or similar penalties and expenses, as
of the Effective Date; provided, that Prior Indebtedness shall not include trade
payables incurred in the Ordinary Course of Business.
 
“Proceeding” shall mean any action, suit, litigation, arbitration, proceeding
(including any civil, criminal, administrative, investigative or appellate
proceeding and any informal proceeding), prosecution, contest, hearing, inquiry,
inquest, audit, examination or investigation commenced, brought, conducted or
heard by or before, or that otherwise has involved or may involve, any
Governmental Authority or any arbitrator or arbitration panel.
 
“Prospectus” shall mean the prospectus included in any Registration Statement
(including, without limitation, a prospectus that discloses information
previously omitted from a prospectus filed as part of an effective registration
statement in reliance upon Rule 430A promulgated under the Act), as amended or
supplemented by any free-writing prospectus or prospectus supplement (including,
without limitation, any prospectus supplement with respect to the terms of the
offering of any portion of the Registrable Securities covered by such
Registration Statement), and all other amendments and supplements to the
Prospectus, including post-effective amendments, and all material incorporated
by reference or deemed to be incorporated by reference in such Prospectus.
 
“Purchase Price” shall have the meaning set forth in Section 2.3(a) of this
Agreement.
 
“Purchaser” shall have the meaning set forth in the Preamble to this Agreement.
 
“Purchaser Common Stock” shall have the meaning set forth in Section 5.4(a) of
this Agreement.
 
“Purchaser Indemnified Party” shall have the meaning set forth in Section 9.2 of
this Agreement.
 
“Purchaser SEC Documents” means (a) the Purchaser’s Annual Reports on Form 10-K
for the 2009 and 2010 fiscal years, (b) its Quarterly Reports on Form 10-Q for
each of the first three fiscal quarters in fiscal year 2009 and 2010, (c) all
proxy statements relating to the Purchaser’s meetings of stockholders (whether
annual or special) held since the beginning of the 2009 fiscal year, (d) its
Current Reports on Form 8-K filed since the beginning of fiscal year 2009, and
(e) all other forms, reports, registration statements, financial statements and
other documents filed or submitted by the Purchaser with or to the SEC since the
beginning of fiscal year 2009.
 
“Purchaser Stock Plans” shall have the meaning set forth in Section 5.4(a) of
this Agreement.
  
 
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The terms “register,” “registered,” and “registration” refer to a registration
effected by preparing and filing a registration statement in compliance with the
Securities Act, and the declaration or ordering of effectiveness of such
registration statement.
 
“Registered IP” shall mean (a) all Intellectual Property Rights that are
registered, filed, or issued under the authority of any Governmental Authority,
including all registered Patents, registered Copyrights and registered
Trademarks, (b) all Internet Properties and (c) all applications for any of the
foregoing.
 
“Registered Company IP” shall mean all Company IP that is Registered IP.
 
“Registrable Securities” means: (a) all of the WEBM Shares issued to the
Stockholders hereunder, and (b) any shares of Common Stock of the Purchaser
issued as a dividend or other distribution with respect to, or in exchange for
or in replacement of, any of the WEBM Shares issued to the Stockholders
hereunder; provided, however, that the term “Registrable Securities” shall
exclude in all events (and such securities shall not constitute “Registrable
Securities”) (i) any Registrable Securities sold or transferred by a person in a
transaction in which the registration rights granted under this Agreement are
not assigned in accordance with the provisions of this Agreement, (ii) any
Registrable Securities sold in a public offering pursuant to a registration
statement filed with the SEC or sold pursuant to Rule 144 promulgated under the
Act (“Rule 144”) or (iii) as to any Stockholder, the Registrable Securities held
by such Stockholder if all of such Registrable Securities can be publicly sold
immediately pursuant to Rule 144.
 
“Registration Statement” shall have the meaning set forth in Section 10.1(a) of
this Agreement.
 
“Related Party” shall mean each of the following: (a) each Stockholder and each
individual who is a director of the Company or any of its Affiliates; (b) each
member of the immediate family of each of the individuals referred to in clause
(a) above; (c) any Entity in which any one of the individuals referred to in
clauses (a) and (b) above holds or held (or in which more than one of such
individuals collectively hold or held), beneficially or otherwise, a controlling
voting interest; and (d) each Company Employee.
 
 “Representative” of a Person means such Person’s members, directors,
controlling Persons, officers, employees, agents, partners and advisors
(including attorneys, accountants, consultants, bankers, financial advisors and
prospective sources of financing for the Transactions), as applicable.
 
“Research Service” means all of the research business and research subscription
services of the Company, including without limitation, the Inside Facebook Gold,
The Facebook Marketing Bible, Inside Virtual Goods and App Data products and
services.
 
“Restricted Stockholders” shall mean each of the individuals holding restricted
stock of the Company, as set forth on Schedule 2.5 hereto.
 
“Restricted Stock Purchase Agreement” shall have the meaning set forth in
Section 2.1 of this Agreement.
 
“SEC” means the Securities and Exchange Commission.
 
“Securities Act” means the Securities Act of 1933, as amended.
 
“Shares” shall have the meaning set forth in the Recitals to this Agreement.
 
“Software” means all computer software and firmware, including data files,
source code, object code and software-related specifications and documentation.
 
“Specified Representations” shall have the meaning set forth in Section 9.1 of
this Agreement.
 
“Straddle Tax Periods” shall have the meaning set forth in Section 7.2 of this
Agreement.
 
“Stock Consideration” shall have the meaning set forth in Section 2.4 of this
Agreement.
 
“Stock Escrow Amount” shall have the meaning set forth in Section 2.5(b) of this
Agreement.
  
 
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“Stockholder” shall have the meaning set forth in the Preamble to this
Agreement.
 
“Stockholder Indemnified Party” shall have the meaning set forth in Section 9.3
of this Agreement.
 
“Stockholder Representative” shall have the meaning set forth in the Preamble to
this Agreement.
 
“Subscription Agreement” means any Contract or license between the Company and
another Person pursuant to which such Person uses the products and services
provided as part of the Business.
 
“Subsidiary” means, with respect to any Person, any and all corporations,
partnerships, limited liability companies, joint ventures, associations and
other entities controlled by such Person.
 
“Support Agreement” means that certain Support Agreement dated and effective as
of the Effective Date between Alan Meckler and Justin L. Smith.
 
“Tax” or “Taxes” means all taxes, assessments, charges, duties, fees, levies,
imposts or other governmental charges, including all federal, state, local,
municipal, county, foreign and other income, franchise, profits, capital gains,
capital stock, capital structure, transfer, gross receipt, sales, use, transfer,
service, occupation, ad valorem, property, excise, severance, windfall profits,
premium, stamp, license, payroll, employment, social security, unemployment,
disability, environmental (including taxes under Code Section 59A), alternative,
minimum, add-on, value-added, withholding and other taxes, assessments, charges,
duties, fees, levies, imposts or other governmental charges of any kind
whatsoever in the nature of a tax (whether payable directly or by withholding
and whether or not requiring the filing of a Tax Return), and all estimated
taxes, deficiency assessments, additions to tax, additional amounts imposed by
any governmental authority (domestic or foreign), and any penalties and interest
with respect thereto.
 
“Tax Period” means any period prescribed by any taxing or Governmental Authority
for which a Tax Return is required to be filed or a Tax is required to be paid.
 
“Tax Return” means any report, return, election, document, estimated tax filing,
declaration or other filing required to be supplied to any taxing authority or
jurisdiction with respect to Taxes, including any amendments thereto.
 
“Third Party” means any Person or group other than a Party hereto.
 
“Third Party Claim” shall have the meaning set forth in Section 9.6 of this
Agreement.
 
“Trademarks” means all registered and common law trademarks, trade names,
service marks, certification marks, service names, tradenames, brands, trade
dress and logos, trademark and service mark registrations and applications, and
the goodwill associated therewith.
 
“Trade Secrets” means all know-how, trade secrets, confidential or proprietary
information, customer lists, technical information, data, process technology,
plans, drawings, inventions, and discoveries, whether or not patentable, of a
particular Person.
 
“Tradeshow” means any event, conference, exhibition or tradeshow owned or
operated by the Company, including without limitation Inside Social Apps and
“FMB 2009”.
 
“Transactions” means the transactions contemplated by this Agreement and the
Ancillary Agreements.
 
“Transaction Expenses” means the sum of all fees, costs and expenses (including
legal fees and accounting fees and including the amount of all special bonuses
and other amounts that may become payable to any officers of the Company or
other Persons in connection with the consummation of the transactions
contemplated by this Agreement) that are incurred by the Company for the benefit
of the Company or a Stockholder in connection with the transactions contemplated
by this Agreement.
  
 
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“Treasury Regulations” means the Treasury Regulations (including Temporary
Regulations) promulgated by the United States Department of Treasury with
respect to the Code or other federal tax statutes.
 
“Unaudited Interim Balance Sheet” shall have the meaning set forth in
Section 3.4 of this Agreement.
 
“Unaudited Interim Balance Sheet Date” means April 30, 2011.
 
“URL” means a uniform resource locator.
 
“User Data” means any Personal Data or other data or information collected by or
on behalf of the Company from users of the Company Products or of any Website.
 
“WARN Act” shall have the meaning set forth in the Section 3.16(h) of this
Agreement.
 
“WEBM Shares” shall mean the shares of Purchaser Common Stock that constitute
the Stock Consideration.
 
“Websites” shall mean any website owned or controlled by the Company, including
without limitation the following:
Insidenetwork.com
Insidefacebook.com
Insidemobileapps.com
Insidesocialgames.com
Insidevirtualgoods.com
Appdata.com
Insidesocialapps.com
 
1.2   Interpretation and Rules of Construction. In this Agreement, except to the
extent otherwise provided or the context otherwise requires:
 
(a) when a reference is made in this Agreement to an Article, Section, Exhibit
or Schedule, such reference is to an Article or Section of, or an Exhibit or
Schedule to, this Agreement unless otherwise indicated;
 
(b) the table of contents and headings for this Agreement are for reference
purposes only and do not affect in any way the meaning or interpretation of this
Agreement;
 
(c) whenever the words “include,” “includes” or “including” are used in this
Agreement, they are deemed to be followed by the words “without limitation”;
 
(d) the words “hereof,” “herein” and “hereunder” and words of similar import,
when used in this Agreement, refer to this Agreement as a whole and not to any
particular provision of this Agreement;
 
(e) the definitions contained in this Agreement are applicable to the singular
as well as the plural forms of such terms;
 
(f) when a reference is made in this Agreement to the Company having delivered a
document to the Purchaser, such reference shall include the Company having
included such document on the virtual data site created for purposes of the
Transactions; and
 
(g) references to a Person are also to its successors and permitted assigns.
     
 
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ARTICLE II
CLOSING; CONSIDERATION
 
2.1   Closing.
 
(a) Subject to the terms and conditions of this Agreement, the Stockholders
shall sell, assign, transfer and deliver to the Purchaser, and the Purchaser
shall purchase and acquire from the Stockholders, all right, title and interest
in and to the Shares, free and clear of all Encumbrances at a closing (the
“Closing”) to be held at the offices of Wyrick Robbins Yates & Ponton LLP,
Raleigh, North Carolina at 12:00 p.m. Eastern Time on the date hereof.
 
(b) Subject to the terms and conditions of a Restricted Stock Purchase
Agreement, in substantially the form of Exhibit C hereto (the “Restricted Stock
Purchase Agreement”), each Restricted Stockholder shall sell, assign, transfer
and deliver to the Purchaser, and the Purchaser shall purchase and acquire from
each Restricted Stockholder, all right, title and interest in and to the Shares
owned by such Restricted Stockholders, free and clear of all Encumbrances at a
Closing to be held at the offices of Wyrick Robbins Yates & Ponton LLP, Raleigh,
North Carolina at 12:00 p.m. Eastern Time on the date hereof.
 
2.2   Stockholder and Company Closing Deliveries. At the Closing, the
Stockholders shall deliver, or cause to be delivered, to the Purchaser the
following:
 
(a) certificates representing the Shares, duly endorsed in blank or accompanied
by duly executed stock powers or other instruments of assignment requested by
and reasonably satisfactory in form and substance to the Purchaser;
 
(b) executed Restricted Stock Purchase Agreements from each of the Restricted
Stockholders, together with certificates representing the Shares owned by such
Restricted Stockholders, duly endorsed in blank or accompanied by duly executed
stock powers or other instruments of assignment requested by and reasonably
satisfactory in form and substance to the Purchaser;
 
(c) the organizational record books, minute books and corporate seal of the
Company;
 
(d) a certificate of non-foreign status that complies with Treasury Regulation
Section 1.1445-2(c)(3);
 
(e) an executed copy of Internal Revenue Service Form W-9 with respect to each
Stockholder;
 
(f) written resignations of the directors and officers of the Company, effective
as of the Effective Date;
 
(g) a certificate, dated as of the Effective Date, signed by the Secretary of
the Company and the Stockholder Representative (i) attaching copies of the
Articles of Incorporation and Bylaws, and any amendments thereto, of the
Company, (ii) attaching a true, correct and complete copy of the stock ledger of
the Company from the date of its incorporation through the Effective Date, (iii)
attaching a detailed summary (in form satisfactory to Purchaser) detailing the
Closing Withholdings to be made by Purchaser out of the payment of the Cash
Consideration to each Restricted Stockholder (under each Restricted Stock
Purchase Agreement) and authorizing and directing Purchaser to make such Closing
Withholdings, and (iv) certifying the good standing of the Company in its
jurisdiction of incorporation and in each other jurisdiction in which it is
qualified to do business, and that there are no proceedings for the dissolution
or liquidation of the Company;
 
(h) evidence, in form and substance reasonably satisfactory to the Purchaser,
that each consent, approval, order or authorization of, or registration,
declaration or filing with any Person required in connection with the execution,
delivery or performance hereof has been obtained or made and is in full force
and effect;
  
 
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(i) a copy of the Employment and Non-Competition Agreement, duly executed by the
Justin L. Smith;
 
(j) a copy of the Escrow Agreement, duly executed by the Stockholder
Representative and the Escrow Agent;
 
(k) evidence reasonably satisfactory to the Purchaser that all Encumbrances
(other than Permitted Encumbrances) affecting any of the Assets of the Company
have been released, or will be released upon repayment of the Prior Indebtedness
pursuant hereto; and
 
(l) all other documents required to be entered into by the Company and the
Stockholders at or prior to the Closing pursuant hereto or reasonably requested
by the Purchaser to convey the Shares to the Purchaser or to otherwise
consummate the Transactions.
 
2.3   Purchaser Closing Deliveries. At the Closing, the Purchaser shall deliver,
or cause to be delivered, to the Stockholders and (as appropriate) the
Restricted Stockholders, the following:
 
(a) the portion of the Purchase Price to be paid at the Closing pursuant to
Section 2.5, paid and delivered in accordance with such Section 2.5;
 
(b) a copy of the Employment and Non-Competition Agreement, duly executed by the
Purchaser;
 
(c) a copy of the Support Agreement, duly executed by Alan Meckler;
 
(d) a copy of the Escrow Agreement, duly executed by the Purchaser and the
Escrow Agent; and
 
(e) all other documents required to be entered into or delivered by the
Purchaser at or prior to the Closing pursuant hereto.
 
2.4   Purchase Price. The Purchaser shall pay and issue the following aggregate
consideration to the Stockholders (pursuant to this Agreement) and the
Restricted Stockholders (pursuant to the Restricted Stock Purchase Agreements)
for the Shares: (a) an aggregate cash amount equal to the sum of (i) Seven
Million Five Hundred Thousand Dollars ($7,500,000), minus (ii) the Prior
Indebtedness, plus (iii) the Closing Cash, (collectively, the “Cash
Consideration”), and (b) an aggregate of 4,183,130 shares of Purchaser Common
Stock (the “Stock Consideration”, and together with the Cash Consideration, the
“Purchase Price”). The Purchase Price shall be subject to adjustment pursuant to
Article IX below.
 
2.5   Payment of Purchase Price.
 
(a) At the Closing, the Purchaser shall pay the Cash Consideration as follows:
(i) Six Hundred Thousand Dollars (US $600,000) (the “Cash Escrow Amount”)
representing Cash Consideration for Justin L. Smith, shall be deposited into the
Escrow Account subject to the Escrow Agreement; and (ii) the remaining Cash
Consideration minus the Cash Escrow Amount and minus the aggregate amount of the
Closing Withholdings (which each Stockholder hereby acknowledges and agrees
shall be withheld by Purchaser) shall be paid by wire transfer to the trust
account of Jones Day, counsel to the Stockholders and Restricted Stockholders,
for the benefit of the Stockholders (pursuant to this Agreement) and the
Restricted Stockholders (pursuant to the Restricted Stock Purchase Agreements)
and in the portions and to the accounts listed on Schedule 2.5 opposite each
such Stockholder’s and Restricted Stockholder’s name.
  
 
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(b) At the Closing, the Purchaser shall pay the Stock Consideration as follows:
(i) an aggregate of 1,115,500 shares of Purchaser Common Stock (the “Stock
Escrow Amount”) representing Stock Consideration for Justin L. Smith, shall be
deposited into the Escrow Account subject to the Escrow Agreement; and (ii) an
aggregate of 3,067,630 shares of Purchaser Common Stock shall be issued to the
Stockholders (pursuant to this Agreement) and the Restricted Stockholders
(pursuant to the Restricted Stock Purchase Agreements; such shares of Purchaser
Common Stock to be held in escrow by the Company in accordance with the terms of
the Restricted Stock Purchase Agreements) in the proportions listed on
Schedule 2.5 opposite each such Stockholder’s or Restricted Stockholder’s
name.  The Purchaser Common Stock issued and sold to the Restricted Stockholders
shall constitute restricted stock of the Purchaser and shall be subject to
vesting and certain restrictions as provided for in the Restricted Stock
Purchase Agreements.
   
ARTICLE III
REPRESENTATIONS AND WARRANTIES
REGARDING THE COMPANY
 
Except as specifically set forth in the Disclosure Schedule, Justin L. Smith
hereby represents and warrants to the Purchaser that the statements contained in
this Article III are true, correct and complete as of the date hereof or, if a
representation or warranty is made as of a specified date, as of such date.
Notwithstanding anything to the contrary herein, (1) the representations and
warranties set forth in this Article III are made for the purpose of allocating
contractual risk between the parties hereto and shall not constitute or be
deemed to be an admission of fact to any third party concerning any item set
forth herein and (2) the use and meaning of the term “material” (and variations
thereof) herein may be different from the use and meaning of such term under
applicable securities laws.
 
3.1   Due Organization; Power; No Subsidiaries; Etc. The Company is a
corporation duly organized, validly existing and in good standing under the laws
of the State of California. The Company has all requisite corporate power and
authority to own, operate or lease its Assets and to carry on its business as
now being conducted and as proposed to be conducted as of the Effective Date.
The Company is duly authorized to conduct business and is in good standing in
each jurisdiction where such authorization is required to conduct the Company’s
business as presently conducted by it, except where the failure to be so
qualified does not constitute a Material Adverse Effect. Neither the Company nor
any of its stockholders has ever approved, or commenced any proceeding or made
any election contemplating, the dissolution or liquidation of the Company or the
winding up or cessation of the Company’s business or affairs. The Company has
made available to the Purchaser complete and accurate copies of the Articles of
Incorporation, Bylaws and other Organizational Documents of the Company as in
effect as of the date hereof. The Company does not have any direct or indirect
Subsidiaries.
 
3.2   Capitalization.
 
(a) The authorized capital stock of the Company as of immediately prior to the
Closing consists of 1,200,000 shares of Common Stock, $0.00001 par value per
share (the “Company Common Stock”). The rights and privileges of the Company
Common Stock are as set forth in the Company’s Articles of Incorporation. As of
the Effective Date, (i) 1,077,500 shares of Company Common Stock were issued and
outstanding, none of which had any accrued or unpaid dividends, (ii) the issued
and outstanding shares of Company Common Stock is held, as of immediately prior
to the Closing, by the individuals and entities listed on Section 3.2(a) of the
Disclosure Schedule, and (iii) no shares of Company Common Stock were held in
the treasury of the Company.
 
(b) Except as described on Section 3.2(b) of the Disclosure Schedule, there are
no issued and outstanding shares of Company Common Stock that constitute
restricted stock or that are otherwise subject to a repurchase or redemption
right, right of first refusal in favor of the Company or any other similar
restriction.
  
 
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(c) There are no options, warrants, equity securities, calls, rights,
commitments or agreements of any character to which the Company is a party or by
which the Company is bound obligating the Company to issue, exchange, transfer,
deliver or sell, or cause to be issued, exchanged, transferred, delivered or
sold, additional shares of capital stock or other equity interests of the
Company or any security or rights convertible into or exchangeable or
exercisable for any such shares or other equity interests, or obligating the
Company to grant, extend, accelerate the vesting of, otherwise modify or amend
or enter into any such option, warrant, equity security, call, right, commitment
or agreement (collectively, “Company Rights”). The Company does not have any
outstanding stock appreciation rights, phantom stock, performance based stock or
equity rights or similar stock or equity rights or obligations. Neither the
Company, the Stockholders nor any of their Affiliates is a party to or is bound
by any agreements or understandings with respect to the voting (including voting
trusts and proxies) or sale or transfer (including agreements imposing transfer
restrictions) of any shares of capital stock or other equity interests of the
Company.
 
(d) All outstanding shares of Company Common Stock are duly authorized, validly
issued, fully paid and nonassessable, were issued in compliance with U.S.
federal and other applicable securities laws, and not subject to or issued in
violation of any purchase option, call option, right of first refusal,
preemptive right, subscription right or any similar right under any provision of
the Corporations Code of the State of California, as amended, the Company’s
Articles of Incorporation or Bylaws or any agreement to which the Company is a
party or is otherwise bound.
 
(e) There are no obligations, contingent or otherwise, of the Company to
(i) repurchase, redeem or otherwise acquire any shares of Company Common Stock
or other capital stock or equity interests of the Company, or (ii) make any
investment (in the form of a loan or capital contribution) in any other Entity,
other than as set forth in Section 3.2(e) of the Disclosure Schedule.
 
3.3   No Conflict; Third Party Consents. Except as set forth in Section 3.3 of
the Disclosure Schedule, the execution and delivery of this Agreement does not,
and the consummation of the Transactions will not, (a) violate or conflict with
the provisions of the Company’s Articles of Incorporation, Bylaws and other
Organizational Documents, (b) result in the imposition of any Encumbrance (other
than the rights of the Purchaser hereunder) upon any of the Company’s Assets,
cause the acceleration, cancellation or material modification of any obligation
under, create in any party the right to terminate, constitute a default or
breach of, or violate or conflict with the terms, conditions or provisions of,
or result in the loss of a material benefit under, any Contract to which the
Company is a party or by which the Company or its Assets are bound or (c) result
in a material breach or violation by the Company of any of the terms, conditions
or provisions of any Legal Requirement, Governmental Authorization or
Governmental Order. Except as set forth in Section 3.3 of the Disclosure
Schedule, the Company is not required to give any notice to any Person, and no
consent, approval or authorization of, or registration or filing with, any
Person or Governmental Authority is required in connection with the execution,
delivery or performance by the Company of this Agreement or any of the Ancillary
Agreements or with the consummation of the Transactions.
 
3.4   Financial Statements.
 
(a) Section 3.4(a) of the Disclosure Schedule includes true, correct and
complete copies of the following financial statements and notes thereto
(collectively, the “Company Financial Statements”).
 
(i) The unaudited consolidated balance sheet of the Company as of December 31,
2010, and the related unaudited consolidated statements of income and
stockholders’ equity for the period then ended; and
  
 
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(ii) The unaudited consolidated balance sheet of the Company as of the Unaudited
Interim Balance Sheet Date (the “Unaudited Interim Balance Sheet”) and the
related unaudited consolidated statements of income, stockholders’ equity and
cash flow for the four months then ended.
 
(b) Each Company Financial Statement: (i) is complete in all respects and has
been prepared in conformity with (A) the books and records of the Company, and
(B) cash accounting practices applied on a consistent basis throughout the
periods covered thereby (except as may be indicated in the notes to such Company
Financial Statements); and (ii) fairly presents, in all material respects, the
consolidated financial position of the Company as of such dates and the
consolidated results of operations and changes in stockholders’ equity of the
Company for the periods then ended, except that the Company Financial Statements
relating to non-year end periods are subject to normal year-end adjustments,
none of which would individually or in the aggregate be material. No financial
statement of any Person (other than the Company) is required by cash accounting
practices to be included in the Company Financial Statements.
 
(c) The books and records of the Company (i) reflect all items of income and
expense and all assets and liabilities required to be reflected in the Company
Financial Statements in accordance with cash accounting practices, and (ii) are
complete and correct in all material respects.
 
(d) The amount of cash held by the Company as of Closing is $859,910.38.
 
3.5   Absence of Changes. From the Unaudited Interim Balance Sheet Date through
the date hereof, (i) the Company has, in all material respects, conducted its
business only in the Ordinary Course of Business; (ii) there has not occurred
any change, event or condition that is a Material Adverse Effect or would
reasonably be expected to result in a Material Adverse Effect and (iii) the
Company has not taken any of the following actions:
 
(a) (i) declared, accrued, set aside or paid any dividends on, or made any other
distributions (whether in cash, stock or property) in respect of, any of its
capital stock or other equity or voting interests, (ii) authorized for issuance
or issued and delivered any additional shares of its capital stock or Company
Rights, (iii) split, combined or reclassified any of its capital stock or other
equity or voting interests, or issued or authorized the issuance of any other
securities in respect of, in lieu of or in substitution for shares of its
capital stock or other equity or voting interests, (iv) purchased, redeemed or
otherwise acquired any shares of capital stock or any other securities of the
Company or any Company Rights, (v) taken any action that would result in any
change of any term (including any conversion price thereof) of any debt security
of the Company, or (vi) hired or agreed to hire any person as an employee,
Company Contractor/Freelancer, independent contractor, agent or consultant;
 
(b) amended or permitted the adoption of any amendment to the Articles of
Incorporation or Bylaws of the Company, or effected, become a party to or
authorized any acquisition transaction, recapitalization, reclassification of
shares, stock split, reverse stock split or similar transaction;
 
(c) incurred any indebtedness for borrowed money except in the Ordinary Course
of Business;
 
(d) adopted a plan of complete or partial liquidation or dissolution or
resolutions providing for or authorizing such a liquidation or a dissolution;
 
(e) formed any Subsidiary or acquired any equity interest or other interest in
any other Person;
  
 
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(f) incurred or assumed any Liability, except for Current Liabilities incurred
in the Ordinary Course of Business that individually do not exceed $2,500 and in
the aggregate do not exceed $2,500;
 
(g) sold, leased or otherwise disposed of any material Assets other than in the
Ordinary Course of Business;
 
(h) granted any Person any license, right (whether or not currently exercisable)
or interest in (including in the form of a covenant not to assert), any Company
IP other than in the Ordinary Course of Business;
 
(i) granted or announced any increase in the salaries, bonuses or other benefits
payable to any Company Employee;
 
(j) terminated any Company employee, other than for cause;
 
(k) settled or compromised any pending or threatened Proceeding;
 
(l) made any capital expenditure outside the Ordinary Course of Business or made
any single capital expenditure in excess of $2,500; provided, however, that the
maximum amount of all capital expenditures made on behalf of the Company since
the Unaudited Interim Balance Sheet Date does not exceed $2,500 in the
aggregate;
 
(m) acquired, leased or licensed any right or other asset from any other Person
or sold or otherwise disposed of, or leased, licensed or encumbered, any right
or other asset to any other Person (except in each case for assets acquired,
leased, licensed, encumbered or disposed of by the Company in the Ordinary
Course of Business and not having a value, or not requiring payments to be made
or received, in excess of $2,500 individually, or $2,500 in the aggregate), or
waived or relinquished any claim or right;
 
(n) granted, created, incurred or suffered to exist any Encumbrance on the
assets of the Company that did not exist as of the Unaudited Interim Balance
Sheet Date or written down the value of any Asset or investment on the books or
records of the Company, except for depreciation and amortization in the Ordinary
Course of Business and consistent with past practice;
 
(o) made any loans, advances or capital contributions to, or investments in, any
other Person;
 
(p) changed its fiscal year, revalued any of its material assets or made any
changes in financial or tax accounting methods, principles or practices;
 
(q) made any changes to the registration of any owned URLs or the hosting of any
owned URLs;
 
(r) made any material changes to the content or look or feel of any Websites or
Research Services;
 
(s) made any material changes to the technology infrastructure or content
management system;
 
(t) taken or omitted to take any action that could, or is reasonably likely to,
breach any provisions of this Agreement or cause the Company to be unable to
operate its business immediately after the Effective Date in the same manner as
operated immediately before the Effective Date after giving effect to the
consummation of the transactions contemplated hereby; or
 
(u) agreed to take any of the actions specified in Sections 3.5(a)-(t).
  
 
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3.6   No Undisclosed Liabilities. The Company has no Liabilities of any nature
with respect to its business (whether accrued, matured or unmatured, fixed or
contingent or otherwise) of the type required to be reflected in the liabilities
of a balance sheet prepared in accordance with GAAP, other than (i) those set
forth or accrued for in the Unaudited Interim Balance Sheet, (ii) those incurred
in the Ordinary Course of Business since the Unaudited Interim Balance Sheet
Date that individually do not exceed $2,500 and in the aggregate do not exceed
$2,500, (iii) those incurred in connection with the execution of this Agreement
or (iv) those set forth in Section 3.6 of the Disclosure Schedule.
 
3.7   Receivables; Major Customers.
 
(a) Section 3.7(a) of the Disclosure Schedule provides an accurate and complete
list of all accounts receivable and other receivables of the Company as of the
Unaudited Interim Balance Sheet Date, together with a range of days elapsed
since invoice.
 
(b) All existing accounts receivable of the Company (including those accounts
receivable reflected on the Unaudited Interim Balance Sheet that have not yet
been collected and those accounts receivable that have arisen since the
Unaudited Interim Balance Sheet Date and have not yet been collected):
(i) represent valid obligations of customers of the Company arising from bona
fide transactions entered into in the Ordinary Course of Business; and (ii) are,
to the Knowledge of the Company, collectible (without any counterclaim or
setoff).
 
(c) Section 3.7(c) of the Disclosure Schedule accurately identifies, and
provides an accurate and complete breakdown of the revenues received from, each
customer of the Company that accounted for (i) more than $50,000 of the gross
revenues of the Company in 2010, or (ii) more than $10,000 of the Company’s
gross revenues from January 1, 2011 through the Unaudited Interim Balance Sheet
Date. The Company has not received any written notice indicating that any
customer required to be identified in Section 3.7(c) of the Disclosure Schedule
may cease dealing with the Company or may otherwise materially reduce the volume
of business transacted by such Person with the Company below historical levels
except in the Ordinary Course of Business.
 
3.8   Tangible Assets. Section 3.8 of the Disclosure Schedule sets forth a list,
as of the date of this Agreement, of each material item of Company Tangible
Property. All such Company Tangible Property as it is operated on the date
hereof: (i) is structurally sound, free of defects and deficiencies and in good
condition and repair in all material respects (ordinary wear and tear excepted);
(ii) complies in all material respects with, and is being operated and otherwise
used in material compliance with, all applicable Legal Requirements; and
(iii) is adequate for the uses to which it is being put.  The Company has no
Company Tangible Property except as set forth on Section 3.8 of the Disclosure
Schedule.  All of the owned Company Tangible Property is owned by the Company
free and clear of any Encumbrances, other than Permitted Encumbrances.
 
3.9   Real Property. The Company does not own any real property. Section 3.9 of
the Disclosure Schedule sets forth a true, correct and complete list and
contains a description (including street address and use) of all of the Leased
Real Property. Except as set forth on Section 3.9 of the Disclosure Schedule,
the Company has no material maintenance or capital improvement obligations on
the Leased Real Property. The agreements pertaining to Leased Real Property are
in full force and effect and valid and enforceable in accordance with their
terms. The Leased Real Property is not subject to or subordinate to any
Encumbrance, other than Permitted Encumbrances and Encumbrances which encumber
the respective landlords’ interest in the Leased Real Property. The Company
enjoys peaceful and undisturbed possession of such premises. The Leased Real
Property is in a condition suitable for return to the lessor under the terms of
the applicable agreement without payment of any penalty or forfeiture of a
security deposit or any portion thereof. The execution and delivery of this
Agreement does not, and the consummation of the transactions contemplated hereby
will not, result in any breach of or constitute a default (or an event that with
notice of lapse of time or both would become a default) under the respective
leases of the Leased Real Property.
  
 
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3.10   Intellectual Property; Software; Privacy.
 
(a) Section 3.10(a) of the Disclosure Schedule contains a complete and correct
list of all Trademarks, Copyrights, URLs, Domain Names and Patents included in
the Intellectual Property which the Company has ownership rights in or has a
valid right to use, license or sublicense in connection with or which relates to
the Business, and identifies all registration and application numbers, the owner
of record and jurisdiction pertaining thereto. The Intellectual Property
identified on Section 3.10(a) of the Disclosure Schedule is owned by, or
properly licensed by the Company (Section 3.10(a) of the Disclosure Schedule
identifying which is owned or licensed) and is valid, subsisting, unexpired, in
proper form and enforceable and all renewal fees and other maintenance fees
which have fallen due on or prior to the date of this Agreement have been paid;
and the grants, registrations and applications for such owned Intellectual
Property have not lapsed, expired or been abandoned and no application or
registration thereof is the subject of any legal or governmental proceeding
before any governmental, registration or other authority in any jurisdiction.
 
(b) Section 3.10(b) of the Disclosure Schedule sets forth a complete list of
all: (i) licenses, sublicenses and other agreements in which the Company or any
sublicensee of the Company has granted to any person or has been granted by any
person the right to use the Intellectual Property and (ii) all other consents,
co-existence agreements, indemnifications, forbearances to sue, settlement
agreements and licensing or cross-licensing arrangements to which the Company is
a party relating to the Intellectual Property or the proprietary rights of any
third party. Except as set forth in Section 3.10(b) of the Disclosure Schedule,
the Company is not under any obligation to pay royalties or other payments in
connection with any license, sublicense or other agreement, nor restricted from
assigning their rights under any license, sublicense or agreement respecting
Intellectual Property nor will the Company otherwise be, as a result of the
execution and delivery of this Agreement or the performance of its obligations
under this Agreement, in breach of any license, sublicense or other agreement
relating to the Intellectual Property.
 
(c) The Company is the exclusive owner of all right, title, and interest in or
has the valid and exclusive right or license to use, free and clear of all
Encumbrances and other adverse claims, all of the Intellectual Property used in
the conduct of the Business as currently conducted. The Company has taken the
steps reasonably necessary to protect their right, title and interest in and to
the Intellectual Property, including the right to license and grant licenses and
sublicenses in any Intellectual Property owned by third parties.
 
(d) No Stockholder, former or current Company employees, directors, officers
Company Contractor/Freelancer or independent contractors hold any right, title,
or interest, directly or indirectly, in whole or in part, to any Intellectual
Property.
 
(e) The Company has taken all reasonable precautions to protect the secrecy,
confidentiality, and value of the Trade Secrets. The Company has good title and
an absolute (but not necessarily exclusive) right to use the Trade Secrets. The
Trade Secrets are not part of the public knowledge or literature, and, to the
Knowledge of the Company, have not been used, divulged, or appropriated either
for the benefit of any Person (other than the Company) or to the detriment of
the Company. No Trade Secret is subject to any adverse claim or has been
challenged or threatened in any way.
 
(f) Except as disclosed on Section 3.10(f) of the Disclosure Schedule, to the
Knowledge of the Company, there are no conflicts with or infringements of any
Intellectual Property by any third party. The conduct of the Business as
currently conducted does not conflict with or infringe in any way with any
proprietary right of any third party. There is no claim, suit, action or
proceeding pending or, to the Knowledge of the Company, threatened against the
Company (i) alleging any such conflict or infringement with any third party’s
proprietary rights or (ii) challenging the ownership, use, validity or
enforceability of the Intellectual Property.
  
 
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(g) Except as set forth on Section 3.10(g) of the Disclosure Schedule, the
Company is not, nor will it be as a result of the execution and delivery of this
Agreement or any Ancillary Agreement or the performance of its obligations
hereunder or thereunder, in breach of any license, sublicense or other agreement
relating to the Intellectual Property.
 
(h) With the exception of Intellectual Property that is owned by third parties
and licensed to the Company pursuant to written license agreements identified on
Section 3.10(h) of the Disclosure Schedule, copies of which have been previously
provided to Purchaser,: (i) no former or present Company Contractor/Freelancer,
employee, officer, director or stockholder of the Company holds any right, title
or interest directly or indirectly, in whole or in part, in or to any
Intellectual Property; (ii) any images, content, programs, products, processes,
designs, modifications, enhancements, know-how, inventions, whether or not
patentable, improvements, discoveries or works of authorship (“Works”) that were
created by Company Contractor/Freelancer or employees, consultants or
contributors of the Company were made in the regular course of such employees'
employment or Company Consultant/Freelancer’s consultant or contributor service
relationships with the Company using the Company’s facilities and resources and,
as such, constitute works made for hire (or are owned by such employees’
employer pursuant to an equivalent legal doctrine in applicable jurisdictions);
and (iii) each such employee who has created, contributed to or participated in
the conception and development of Works or any employee who in the regular
course of his employment may create Works and all Company
Contractor/Freelancers, consultants, contributors, contractors, subcontractors
or persons performing work on behalf of the Company who have created,
contributed to or participated in the conception and development of Works, have
executed an assignment or been a party to a similar agreement with the Company
that has accorded the Company full, effective, valid and exclusive ownership or,
in the alternate, transferring and assigning to the Company all right, title and
interest in and to such Works, including copyright, patent and other
intellectual property rights therein.
 
(i) The Intellectual Property is sufficient, adequate and constitutes all of the
Intellectual Property that is necessary for the Company to carry on the Business
as presently conducted.
 
(j) Software. Section 3.10(j) of the Disclosure Schedule sets forth a complete
list of all software used in connection with the Business that the Company
either owns outright, or has an exclusive perpetual, royalty-free license to
use, reproduce, modify, distribute and sublicense (“Proprietary Software”). The
Company has not sold, licensed, leased or otherwise transferred or granted any
interest or rights in or to any portion of the Proprietary Software. The third
party software, programs and databases used or licensed in connection with the
conduct of the business as now conducted (the “Third Party Software”) are listed
on Section 3.10(j) of the Disclosure Schedule. The Company has valid, fully paid
licenses to use, reproduce, modify, distribute and sublicense all copies of the
Third Party Software to the extent it has so done or is so doing, and has not
sold, licensed, leased or otherwise transferred or granted any interest or
rights in or to any portion thereof in violation of any agreement to which the
Company is a party. The Proprietary Software and Third Party Software are free
from any material defect, error and the Company has no knowledge of any bugs or
viruses.
 
(k) Privacy. Section 3.10(k) of the Disclosure Schedule contains each Company
Privacy Policy in effect at any time and identifies, with respect to each such
Company Privacy Policy, the period of time during which such Company Privacy
Policy was or has been in effect. The Company has complied at all times and in
all material respects with all of the Company Privacy Policies and with all
applicable United States Legal Requirements pertaining to privacy (including the
obtaining, storing, using or transmitting of User Data) and User Data. The
Company has complied at all times and in all material respects with the “safe
harbor” framework developed by the United States Department of Commerce in
consultation with the European Commission regarding the European Commission’s
Directive on Data Protection in connection with User Data (including the
obtaining, storing, using or transmitting of User Data). To the Knowledge of the
Company, the Company has complied with all other applicable foreign Legal
Requirements pertaining to privacy (including the obtaining, storing, using or
transmitting of User Data) and User Data, except where such failure to comply
would not have a Material Adverse Effect on the Company. Neither the execution,
delivery, or performance of this Agreement (or any of the Ancillary Agreements)
nor the consummation of any of the Transactions, nor the Purchaser’s possession
or use of User Data, will result in any violation of any Company Privacy Policy
or any applicable Legal Requirement pertaining to privacy or User Data.
  
 
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3.11 Contracts.
 
(a) Section 3.11(a) of the Disclosure Schedule identifies and provides an
accurate and complete list of each Company Contract. Without limiting the
foregoing, Section 3.11 of the Disclosure Schedule lists the following Company
Contracts:
 
(i) all Advertising Agreements currently in effect;
 
(ii) all Media Buying Agreements currently in effect;
 
(iii) all Client Agreements currently in effect;
 
(iv) all Company Contracts with individuals who serve as independent contractors
or consultants to the Company (or similar arrangements);
 
(v) all Company Contracts relating to indebtedness for borrowed money;
 
(vi) all Company Contracts that limit or purport to limit the ability of the
Company to (A) compete in any line of business or with any Person or in any
geographic area or during any period of time, (B) to solicit, hire or retain any
Person as an employee, consultant or independent contractor or (C) to develop,
market or sell any product, technology or service to or for any other Person;
 
(vii) all Company Contracts that are leases for Leased Real Property;
 
(viii) all Company Contracts providing for payments to or by any Person based on
sales, purchases or profits, other than direct payments for goods or employee
commission plans;
 
(ix) all Company Contracts in which another Person is or was appointed as a
distributor, reseller or sales representative with respect to, or otherwise is
or was authorized to market, promote, distribute, resell, sublicense, support or
solicit orders for, any services or products of the Company;
 
(x) all Company Contracts for partnerships or joint ventures;
 
(xi) all Employee Agreements;
 
(xii) all Company Contracts that (A) grant any Person other than the Company and
its Affiliates any (1) exclusive license, supply or distribution rights or other
exclusive rights, (2) “most favored nation” rights, (3) impose non-competition
obligations or other restrictive covenants or (4) rights of first refusal,
rights of first negotiation or similar rights with respect to any Company
Product or Company IP or (B) contain any provision that requires the purchase of
all or a given portion of the Company’s requirements from a given Third Party;
 
(xiii) all Company Contracts between the Company and its Affiliates;
 
(xiv) all Company Contracts for payment of royalties or a share of revenues or
profits; and
 
(xv) each Company Contract the Breach of which would have a Material Adverse
Effect.
 
(b) The Company has delivered to the Purchaser accurate and complete copies of
all written Company Contracts, including all amendments thereto, and a written
summary setting forth the terms and conditions of each oral Company Contract.
Each Company Contract is valid, binding and enforceable against the Company and,
to the Knowledge of the Company, the other parties thereto in accordance with
its terms and is in full force and effect. Except as set forth in
Section 3.11(b) of the Disclosure Schedule:
  
 
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(i) the Company has not and, to the Knowledge of the Company, no other Person
has, violated or breached in any material respect, or declared or committed any
material default under, any Company Contract currently in effect;
 
(ii) to the Knowledge of the Company, no event has occurred, and no circumstance
or condition exists, that would reasonably be expected to (with or without
notice or lapse of time) (A) result in a material violation or breach of any of
the provisions of any Company Contract, (B) give any Person the right to declare
a default or exercise any remedy under any Company Contract, (C) give any Person
the right to accelerate the maturity or performance of any Company Contract, or
(D) except as set forth in Section 3.11(b)(ii) of the Disclosure Schedule, give
any Person the right to cancel, terminate or modify any material Company
Contract; and
 
(iii) Except as set forth in Section 3.11(b)(iii) of the Disclosure Schedule,
the Company has not received any written notice or other communication regarding
any actual, alleged, possible or potential material violation or breach of, or
material default under, any Company Contract.
 
(iv) the Company has not waived any of its material rights under any Company
Contract.
 
(c) To the Knowledge of the Company, each Person against which the Company has
or may acquire any rights under any Company Contract is solvent and is able to
satisfy all of such Person’s current and future monetary obligations and other
obligations and Liabilities to the Company.
 
(d) (i) the Company has not guaranteed or otherwise agreed to cause, insure or
become liable for, and the Company has not pledged any of its assets to secure,
the performance or payment of any obligation or other Liability of any other
Person; and (ii) the Company has not been a party to or bound by (A) any joint
venture agreement, partnership agreement, profit-sharing agreement, cost-sharing
agreement, loss-sharing agreement or similar Contract, or (B) any Contract that
creates or grants to any Person, or provides for the creation or grant of, any
option, stock appreciation right, phantom stock right, deferred compensation, or
any other similar right or interest.
 
(e) Except as set forth in Section 3.11(e) of the Disclosure Schedule, the
Contracts identified in Section 3.11(a) of the Disclosure Schedule collectively
constitute all of the Contracts necessary to enable the Company to conduct its
business in the manner in which it is currently being conducted in all material
respects.
 
3.12   Liabilities; Major Suppliers.
 
(a) Section 3.12 of the Disclosure Schedule: (i) provides an accurate and
complete breakdown and aging of the Company’s accounts payable as of the
Unaudited Interim Balance Sheet Date, (ii) provides an accurate and complete
breakdown of all customer deposits and other deposits held by the Company as of
the date of this Agreement and (iii) provides an accurate and complete breakdown
of the Company’s debt as of the date of this Agreement.
 
(b) Section 3.12 of the Disclosure Schedule accurately identifies, and provides
an accurate and complete breakdown of the amounts paid to each supplier or other
Person that received (i) more than $25,000 from the Company in 2010 or (ii) more
than $10,000 from the Company during the period from January 1, 2011 to the
Unaudited Interim Balance Sheet Date.
  
 
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3.13   Compliance With Legal Requirements. Except as set forth in Section 3.13
of the Disclosure Schedule:
 
(a) the Company is in compliance in all material respects with each applicable
Legal Requirement to which the Company is subject;
 
(b) to the Knowledge of the Company, no event has occurred, and no condition or
circumstance exists, that would reasonably be expected (with or without notice
or lapse of time) to constitute or result directly or indirectly in a material
violation by the Company of, or a material failure on the part of the Company to
comply with, any applicable Legal Requirement to which the Company is subject;
and
 
(c) The Company has not received any written notice or, to the Knowledge of the
Company, any other communication from any Governmental Authority or any other
Person regarding (i) any actual, alleged, possible or potential violation of, or
failure to comply with, any applicable Legal Requirement to which the Company is
subject, or (ii) any actual, alleged, possible or potential obligation on the
part of the Company to undertake, or to bear all or any portion of the cost of,
any cleanup or any remedial, corrective or response action of any nature.
 
3.14   Governmental Authorizations.
 
(a) (x) The Company holds all Governmental Authorizations necessary to
(i) enable the Company to conduct its business in the manner in which it is
currently being conducted, and (ii) permit the Company to own and use its
properties and assets in the manner in which they are currently owned and used;
and (y) Section 3.14 of the Disclosure Schedule identifies each other
Governmental Authorization that, to the Knowledge of the Company, is held by any
of the Company’s employees (collectively clauses (x) and (y), the “Company
Governmental Authorizations”). The Company has delivered to the Purchaser
accurate and complete copies of all of the Company Governmental Authorizations,
including all renewals thereof and all amendments thereto. Each of the Company
Governmental Authorization is valid and in full force and effect.
 
(b) The Company is and at all times has been in compliance with all of the terms
and requirements of each of the Company Governmental Authorizations.
 
(c) To the Knowledge of the Company, no event has occurred, and no condition or
circumstance exists, that would reasonably be expected (with or without notice
or lapse of time) to (A) constitute or result directly or indirectly in a
violation of or a failure to comply with any term or requirement of any of the
Company Governmental Authorizations, or (B) result directly or indirectly in the
revocation, withdrawal, suspension, cancellation, termination or modification of
any of the Company Governmental Authorizations.
 
(d) The Company has not received, and, to the Knowledge of the Company, no
employee of the Company has ever received, any written notice or other
communication from any Governmental Authority or any other Person regarding
(A) any actual, alleged, possible or potential violation of or failure to comply
with any term or requirement of any Company Governmental Authorization or
(B) any actual, proposed, possible or potential revocation, withdrawal,
suspension, cancellation, termination or modification of any Company
Governmental Authorization.
 
(e) All applications required to have been filed for the renewal of any of the
Company Governmental Authorizations have been duly filed on a timely basis with
the appropriate Governmental Authorities, and each other notice or filing
required to have been given or made with respect to such Governmental
Authorizations has been duly given or made on a timely basis with the
appropriate Governmental Authority.
  
 
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3.15 Tax Matters.
 
(a) The Company has filed all income Tax Returns and all material other Tax
Returns required to be filed by it, each such Tax Return with respect to the
Company has been prepared in compliance with all material applicable Legal
Requirements, and all such Tax Returns with respect to the Company are true and
accurate in all material respects. The Company has delivered to the Purchaser
accurate and complete copies of all such income Tax Returns.
 
(b) All income Taxes, all employment-related Taxes and all material other Taxes
concerning or attributable to the Company required to have been paid by the
Company have been paid in full on a timely basis, any Tax required to have been
withheld by the Company from amounts owing to, or with respect to any income
received by, any employee or other Person or collected from any other Person by
the Company has been duly withheld and collected, and (to the extent required)
each such Tax has been paid to the appropriate Governmental Authority.
 
(c) No examination or audit of any Tax Return of the Company has ever been
conducted.
 
(d) The Company has never been a party to or bound by any tax indemnity
agreement, tax sharing agreement, tax allocation agreement or similar contract,
and after the Effective Date, the Company will not be bound by any such
agreements or have any liability thereunder. The Company has no liability for
Taxes of any other Entity as a result of being or having been, before the
Effective Date, a member of an affiliated, consolidated, combined or unitary
group.
 
(e) (i) No claim or other Proceeding is pending or, to the Knowledge of the
Company, has been threatened in writing against or with respect to the Company,
(ii) there are no unsatisfied Liabilities for Taxes (including Liabilities for
interest, additions to tax and penalties thereon and related expenses) with
respect to any notice of deficiency or similar document received by the Company,
and (iii) there are no liens for Taxes on the assets of the Company (other than
liens for Taxes not yet due and payable). The Company is not bound by any
agreement or consent pursuant to former Section 341(f) of the Code.
 
(f) The Company is not a party to any agreement, contract, arrangement or plan
that has resulted or would result, separately or in the aggregate, in the
payment of (x) any excess “parachute payments” within the meaning of
Section 280G of the Code as a result of the Transactions, or (y) any amount for
which a deduction would be reasonably disallowed or deferred under Section 162
or Section 404 of the Code.
 
(g) Each plan document with respect to each Company Employee Plan, and Employee
Agreement, that is a “nonqualified deferred compensation plan” within the
meaning of Section 409A of the Code, is, and has been, in compliance in all
material respects with Section 409A of the Code. Each Company Employee Plan, and
Employee Agreement, that is a “nonqualified deferred compensation plan” within
the meaning of Section 409A of the Code is, and has been, operated in good faith
compliance with Section 409A of the Code, to the extent applicable.  No
stockholder of the Company has filed any election or notice under Section 83(b)
of the Code.
 
(h) The Company is not a “United States real property holding corporation”
within the meaning of Section 897 of the Code.
 
(i)  Accurate and complete copies of Smith’s 2009 personal income Tax Returns
and any amendments thereto (collectively, the “Smith 2009 Tax Returns”) have
been provided to Purchaser.  No examination or audit of any of the Smith 2009
Tax Returns has ever been conducted.  To the knowledge of Justin L. Smith, each
of the Smith 2009 Tax Returns has been prepared in substantial compliance with
all material applicable Legal Requirements, and is true and accurate in all
material respects.  The Smith 2009 Tax Returns include information and
disclosure regarding the financial results of the Company (then known as
Prophetic Media, LLC, a California limited liability company, “Prophetic Media”)
for calendar year 2009 (such information and disclosure the “Prophetic Media
2009 Financial Information”).  Except as set forth in Section 3.15(i) of the
Disclosure Schedule, the Prophetic Media 2009 Financial Information, as
presented in the Smith 2009 Tax Returns, (i) is accurate and complete in all
material respects and was prepared in conformity with (A) the books and records
of Prophetic Media, and (B) cash accounting practices applied on a consistent
basis throughout the 2009 calendar year and (ii) fairly presents, in all
material respects, the financial position of Prophetic Media as of December 31,
2009, and the results of operations and changes in members’ equity of Prophetic
Media for the period then ended.
  
 
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3.16   Employee and Labor Matters.
 
(a) Section 3.16(a) of the Disclosure Schedule accurately sets forth, with
respect to each Company Employee (including any such Company Employee who is on
a leave of absence or on layoff status): (i) the name and title of such
employee; (ii) the aggregate dollar amount of the compensation (including wages,
salary, commissions, director’s fees, fringe benefits, bonuses, profit-sharing
payments and other payments or benefits of any type, but excluding health and
welfare benefits generally available to all of the Company’s employees) received
by such employee from the Company with respect to services performed in 2009 and
2010; (iii) such employee’s annualized compensation as of the date of this
Agreement and (iv) date of hire and date of last salary increase.
 
(b) The employment of each Company Employee is terminable by the Company at
will. The Company has delivered to the Purchaser accurate and complete copies of
all employee manuals and handbooks, disclosure materials and policy statements
relating to the employment of the current and former Company Employees.
 
(c) To the Knowledge of the Company, no Company Employee is a party to or is
bound by any confidentiality agreement, noncompetition agreement or other
Contract with any Person.
 
(d) Section 3.16(d) of the Disclosure Schedule sets forth, with respect to each
independent contractor of the Company and each independent contractor performing
services for the Company: (i) the name of such independent contractor; (ii) a
brief description of such independent contractor’s duties and responsibilities;
(iii) the aggregate dollar amount of the compensation (including all payments or
benefits of any type) received by such independent contractor from the Company
with respect to services performed in 2009 and 2010; (iv) the terms of
compensation of such independent contractor; and (v) any Governmental
Authorization that is held by such independent contractor and that relates to or
is useful in connection with the Company’s business. To the Knowledge of the
Company, no current independent contractor intends to terminate providing
services to the Company.
 
(e) The Company is not a party to or bound by, and the Company has never been a
party to or bound by, any union contract, collective bargaining agreement or
similar Contract.
 
(f) There has not been any slowdown, work stoppage, labor dispute or union
organizing activity, or any similar activity or dispute, affecting the Company
or any of the Company Employees. To the Knowledge of the Company, there is not
now pending, and, to the Knowledge of the Company, no Person has threatened to
commence, any such slowdown, work stoppage, labor dispute or union organizing
activity or any similar activity or dispute. There are no Proceedings, suits,
claims, labor disputes or grievances pending or, to the Knowledge of the
Company, threatened or reasonably anticipated relating to any labor, safety or
discrimination matters involving any Company Employee or former Company
Employee, including, without limitation, charges of unfair labor practices or
discrimination complaints.
 
(g) None of the current independent contractors of the Company, former
independent contractors of the Company or any other individual or entity
providing services indirectly for the Company through an intermediary (i) should
be reclassified as an employee under applicable Legal Requirement or (ii) is
eligible to participate in any Company Employee Plan.
  
 
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(h) The Company is, in all material respects, in compliance with the Worker
Adjustment and Retraining Notification Act (the “WARN Act”) and any similar
state or local Legal Requirement.
 
(i) To the Knowledge of the Company, none of the Stockholders, and no officer or
director or person nominated to become an officer or director of the Company or
any Subsidiary of the Company, (i) has been convicted in a criminal proceeding
or is a named subject of a pending criminal proceeding (excluding minor traffic
violations) or (ii) is or has been subject to any judgment or order of, or the
subject of any pending civil or administrative action by the SEC or any
self-regulatory organization.
 
3.17   Employee Benefit Plans and Compensation.
 
(a) Section 3.17(a) of the Disclosure Schedule contains an accurate and complete
list as of the date hereof of each Company Employee Plan and each Employee
Agreement. Neither the Company nor any ERISA Affiliate intends or has committed
to establish or enter into any new Company Employee Plan or Employee Agreement,
or to modify materially any Company Employee Plan or Employee Agreement (except
to conform any such Company Employee Plan or Employee Agreement to the
requirements of any applicable Legal Requirements).
 
(b) The Company has delivered to the Purchaser: (i) correct and complete copies
of all documents setting forth the terms of each Company Employee Plan and each
Employee Agreement, including all amendments thereto and all related trust
documents; (ii) the three most recent annual reports (Form Series 5500 and all
schedules and financial statements attached thereto), if any, required under
ERISA or the Code in connection with each Company Employee Plan; (iii) the most
recent summary plan description together with the summaries of material
modifications thereto, if any, required under ERISA with respect to each Company
Employee Plan; (iv) all material written Contracts relating to each Company
Employee Plan, including administrative service agreements and group insurance
contracts; (v) all material correspondence to or from any Governmental Authority
relating to any Company Employee Plan; (vi) all insurance policies in the
possession of the Company pertaining to fiduciary liability insurance covering
the fiduciaries for each Company Employee Plan; (vii) all discrimination tests
required under the Code for each Company Employee Plan intended to be qualified
under Section 401(a) of the Code for the three most recent plan years; and
(viii) the most recent IRS determination or opinion letter issued with respect
to each Company Employee Plan intended to be qualified under Section 401(a) of
the Code.
 
(c) The Company and each ERISA Affiliate has performed all material obligations
required to be performed by it under each Company Employee Plan and is not in
default or violation of, and to Knowledge of the Company, there has been no
default or violation by any other party to, the terms of any Company Employee
Plan, and each Company Employee Plan has been established and maintained
substantially in accordance with its terms and in substantial compliance with
all applicable Legal Requirements, including ERISA and the Code.
 
(d) Neither the Company nor any ERISA Affiliate has ever maintained,
established, sponsored, participated in or contributed to any: (i) “defined
benefit plan” within the meaning of Section 414 of the Code; (ii) “multiemployer
plan” within the meaning of Section (3)(37) of ERISA; or (iii) any Company
Employee Plan that is not subject to United States law or that is for the
benefit of persons whose services to the Company are performed primarily outside
of the United States.
  
 
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(e) No Company Employee Plan provides (except at no cost to the Company or the
Purchaser), or reflects or represents any material liability of the Company to
provide, retiree life insurance, retiree health benefits or other retiree
employee welfare benefits to any Person for any reason, except as may be
required by COBRA or other applicable Legal Requirements. Other than commitments
made that involve no future costs to the Company, the Company has never
represented, promised or contracted (whether in oral or written form) to any
Company Employee (either individually or to Company Employees as a group), any
former Company Employee or any other Person that such Company Employee(s) or
other person would be provided with retiree life insurance, retiree health
benefit or other retiree employee welfare benefits, except to the extent
required by applicable Legal Requirements.
 
(f) The Company: (i) is in material compliance in all respects with all
currently applicable Legal Requirements respecting employment, employment
practices, terms and conditions of employment and wages and hours, in each case,
with respect to Company Employees and former Company Employees, including the
health care continuation requirements of COBRA, the requirements of the United
States Family Medical Leave Act, the requirements of the Health Insurance
Portability and Accountability Act of 1996 and any similar provisions of state
or foreign law; (ii) has withheld and reported all material amounts required by
applicable Legal Requirements or by Contract to be withheld and reported with
respect to wages, salaries and other payments to Company Employees and former
Company Employees; (iii) is not liable for any material arrears of wages or any
taxes or any penalty for failure to comply with the Legal Requirements
applicable of the foregoing; and (iv) is not liable for any material payment to
any trust or other fund governed by or maintained by or on behalf of any
Governmental Authority with respect to unemployment compensation benefits,
social security or other benefits or obligations for Company Employees or former
Company Employees (other than routine payments to be made in the normal course
of business and consistent with past practice). There are no pending or, to the
Knowledge of the Company, threatened or reasonably anticipated claims or
Proceedings against the Company under any worker’s compensation policy or
long-term disability policy.
 
3.18   Environmental Matters. The Company is not liable or potentially liable
for any response cost or natural resource damages under Section 107(a) of
CERCLA, or under any other so-called “superfund” or “superlien” law or similar
Legal Requirement, at or with respect to the Leased Real Property or any site
used by the Company. The Company has never received any written notice or other
communication from any Governmental Authority or other Person regarding any
actual, alleged, possible or potential Liability arising from or relating to the
presence, generation, manufacture, production, transportation, importation, use,
treatment, refinement, processing, handling, storage, discharge, release,
emission or disposal of any Hazardous Material. No Person has ever commenced or,
to the Knowledge of the Company, threatened to commence any contribution action
or other Proceeding against the Company in connection with any such actual,
alleged, possible or potential Liability; and no event has occurred, and, to the
Knowledge of the Company, no condition or circumstance exists, that would
reasonably be expected to, directly or indirectly, give rise to, or result in
the Company becoming subject to, any such Liability at or with respect to the
Leased Real Property or any site used by the Company. Except for de minimis
amounts of such cleaning and other materials as would normally be associated
with operations like those conducted on the Leased Real Property or any site
used by the Company (which materials were used in compliance with all Legal
Requirements), the Company has never generated, manufactured, produced,
transported, imported, used, treated, refined, processed, handled, stored,
discharged, released or disposed of any Hazardous Material (whether lawfully or
unlawfully) at the Leased Real Property or any site used by the Company. The
Company has never permitted any Hazardous Material to be generated,
manufactured, produced, used, treated, refined, processed, handled, stored,
discharged, released or disposed of (whether lawfully or unlawfully): (i) on or
beneath the surface of the Leased Real Property or any real property that is, or
that has at any time been, owned by, leased to, controlled by or used by the
Company; (ii) in or into any surface water, groundwater, soil or air associated
with or adjacent to any such real property; or (iii) in or into any well, pit,
pond, lagoon, impoundment, ditch, landfill, building, structure, facility,
improvement, installation, equipment, pipe, pipeline, vehicle or storage
container that is or was located on or beneath the surface of any such real
property.
  
 
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3.19   Insurance.
 
(a) Section 3.19 of the Disclosure Schedule sets forth, with respect to each
insurance policy of the Company or the Leased Real Property: (i) the name of the
insurance carrier that issued such policy and the policy number of such policy;
(ii) a brief summary of the coverage provided by such policy; (iii) the annual
premium payable with respect to such policy; and (iv) a description of any
claims pending, and any claims that have been asserted in the past, with respect
to such policy and that relate or related to any damage, destruction or loss of
any of the Company’s Assets in excess of $20,000.
 
(b) Each of the policies required to be identified in Section 3.19 of the
Disclosure Schedule is valid, enforceable and in full force and effect, and has
been issued by an insurance carrier that, to the Knowledge of the Company, is
solvent, financially sound and reputable. All of the information contained in
the applications submitted in connection with said policies was (at the times
said applications were submitted) accurate and complete, and all premiums and
other amounts owing with respect to said policies have been paid in full on a
timely basis. The nature, scope and dollar amounts of the insurance coverage
provided by said policies are sufficient to adequately insure the Company’s
property and assets, the Leased Real Property, and its operations, key
employees, services and potential liabilities.
 
(c) There is no pending claim under or based upon any of the policies required
to be identified in Section 3.19 of the Disclosure Schedule; and no event has
occurred, and no condition or circumstance exists, that could reasonably be
expected to (with or without notice or lapse of time) directly or indirectly
give rise to or serve as a basis for any such claim.
 
(d) The Company has not received: (i) any written notice or, to the Knowledge of
the Company, any other communication regarding the actual or possible
cancellation or invalidation of any of the policies required to be identified in
Section 3.19 of the Disclosure Schedule or regarding any actual or possible
adjustment in the amount of the premiums payable with respect to any of said
policies; (ii) any written notice or, to the Knowledge of the Company, any other
communication regarding any actual or possible refusal of coverage under, or any
actual or possible rejection of any claim under, any of the policies required to
be identified in Section 3.19 of the Disclosure Schedule; or (iii) any
indication that the issuer of any of the policies required to be identified in
Section 3.19 of the Disclosure Schedule may be unwilling or unable to perform
any of its obligations thereunder.
 
3.20   Related Party Transactions. No Related Party has any direct or indirect
interest of any nature in any of the Company’s Assets or Liabilities. No Related
Party has entered into, or has had any direct or indirect financial interest in,
any Company Contract. No Related Party is competing, or has at any time
competed, directly or indirectly, with the Company.
 
3.21   Proceedings; Orders.
 
(a) There is no pending Proceeding, and to the Knowledge of the Company, no
Person has threatened to commence any Proceeding: (i) that involves the Company
or the Company’s Assets or Liabilities (whether or not the Company is named as a
party thereto); or (ii) that challenges, or that would reasonably be expected to
have the effect of preventing, delaying, making illegal or otherwise interfering
with, any of the Transactions. No event has occurred, and to the Knowledge of
the Company, no claim, dispute or other condition or circumstance exists, that
would reasonably be expected to give rise, directly or indirectly, to the
commencement of any such Proceeding.
 
(b) No Proceeding has been commenced by or against the Company, and no
Proceeding otherwise involving or relating to the Company has been pending or,
to the Knowledge of the Company, threatened at any time.
  
 
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(c) There is no Governmental Order to which the Company or its Assets or
Liabilities are subject.
 
(d) To the Knowledge of the Company, (i) no officer of the Company or Company
Employee is subject to any Governmental Order that prohibits such officer or
Company Employee from engaging in or continuing any conduct, activity or
practice relating to the Company’s business and (ii) there is no proposed
Governmental Order that, if issued or otherwise put into effect, would
reasonably be expected to have an adverse effect on the Company’s business,
condition, Assets, Liabilities, operations, financial performance, net income or
prospects (or on any aspect or portion thereof) or on the ability of the Company
to comply with or perform any covenant or obligation under this Agreement or any
Ancillary Agreement, or would reasonably be expected to have the effect of
preventing, delaying, making illegal or otherwise interfering with any of the
Transactions.
 
3.22   List of Active Clients and Advertisers; Business Results.
 
(a) Section 3.22(a) of the Disclosure Schedule lists (A) all of the active
Research Service Clients (with subscription details) as of 12:00 p.m. Eastern
time on the day immediately prior to the Effective Date; and (B) all of the
active Advertisers (with open advertising details) as of 12:00 p.m. Eastern time
on the day immediately prior to the Effective Date.
 
(b) Paid Conference Attendees. The Business had the number of paid conference
attendees for each of the Company Tradeshows as listed, by Tradeshow, on
Section 3.22(b) of the Disclosure Schedule.
 
(c) Paid Exhibitors/Sponsors. The Business had the number of paid exhibitors
and/or sponsors for each of the Company Tradeshows as listed, by Tradeshow, on
Section 3.22(c) of the Disclosure Schedule.
 
(d) Research Service Subscribers. The Business had the number of total active,
new, renewal and cancelled paid Research Services subscribers for each Research
Service product (listed by monthly, quarterly and annual subscription), for each
of the year ended 2010 and for each month of 2011 as shown on Section 3.22(d) of
the Disclosure Schedule.  
 
3.23   Title to Assets.  The Company has good, valid, transferable and
marketable title to, or valid leasehold interests or license interests in, all
of its Assets, in each case free and clear of any Encumbrances other than
Permitted Encumbrances, or in the case of Company Tangible Property, an
enforceable right to use all leased items of Company Tangible Property.
 
3.24   Sufficiency of Assets.  The property and other Assets (whether real,
personal or mixed and whether tangible or intangible) owned by the Company or
used under enforceable Contracts comprise all of the assets necessary for the
conduct of the Company’s business as it is being conducted as of the Effective
Date and are sufficient for the Purchaser to conduct the Company’s business as
it is being conducted as of and after the Effective Date.
 
3.25   Brokers. Neither the Company nor any Stockholder has agreed or become
obligated to pay, or has taken any action that could reasonably be expected to
result in any Person claiming to be entitled to receive, any brokerage
commission, finder’s fee or similar commission or fee in connection with any of
the Transactions.
 
3.26   Conversion to Corporation.  The conversion of Prophetic Media, LLC, a
California limited liability company, to Inside Network, Inc., a California
corporation, was conducted in compliance with California law and Inside Network,
Inc. succeeded to all of the assets and liabilities of Prophetic Media, LLC.
  
 
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3.27   Full Disclosure. This Agreement, the Ancillary Agreements and the
Disclosure Schedule, when taken as a whole, do not contain any untrue statement
of fact or omit to state any fact necessary to make any of the representations,
warranties or other statements or information contained therein not misleading.
There is no fact to the Knowledge of the Company (other than publicly known
facts relating exclusively to political or economic matters of general
applicability that will adversely affect all comparable entities in the
Company’s industry) that could reasonably be expected to have a Material Adverse
Effect.
 
ARTICLE IV
REPRESENTATIONS AND WARRANTIES
OF EACH STOCKHOLDER
 
Each Stockholder hereby represents and warrants to the Purchaser, severally and
not jointly, that the statements contained in this Article IV with respect to
such Stockholder are true, correct and complete as of the date hereof or, if a
representation or warranty is made as of a specified date, as of such date.
Notwithstanding anything to the contrary herein, (1) the representations and
warranties set forth in this Article IV are made for the purpose of allocating
contractual risk between the parties hereto and shall not constitute or be
deemed to be an admission of fact to any third party concerning any item set
forth herein and (2) the use and meaning of the term “material” (and variations
thereof) herein may be different from the use and meaning of such term under
applicable securities laws.
 
4.1   Due Organization. Such Stockholder, if not an individual, is duly formed,
validly existing and, as applicable, in good standing under the laws of the
jurisdiction of its organization.
 
4.2   Ownership; Title to Shares.
 
(a) Such Stockholder is the record and beneficial owner of the Shares shown as
owned by such Stockholder on Schedule 2.5. Such Stockholder has good and valid
title to the Shares to be sold by such Stockholder hereunder, free and clear of
all Encumbrances.
 
(b) Upon: (i) receipt by such Stockholder of such Stockholder’s portion of the
Cash Consideration (if any) and Stock Consideration pursuant to Section 2.3
(which, for this purpose, shall be deemed to include amounts paid or property
deposited into the Escrow Account, which each Stockholder acknowledges has been
paid to and received by such Stockholder prior to its deposit into the Escrow
Account), and (ii) transfer of the Shares owned by such Stockholder to the
Purchaser in accordance with the terms of this Agreement, the Purchaser will
receive good and valid title to such Shares, free and clear of all Encumbrances.
 
(c) There are no options, warrants, equity securities, calls, rights,
commitments or agreements of any character to which such Stockholder is a party
or by which such Stockholder is bound obligating such Stockholder to exchange,
transfer, deliver or sell, or cause to be exchanged, transferred, delivered or
sold, the Shares or other equity interests of the Company owned by such
Stockholder or any security or rights convertible into or exchangeable or
exercisable for any such Shares or other equity interests. Such Stockholder is
not a party to or bound by any agreements or understandings with respect to the
voting (including voting trusts and proxies) or sale or transfer (including
agreements imposing transfer restrictions) of any of the Shares other equity
interests of the Company owned by such Stockholder.
  
 
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4.3   Due Authorization. The execution and delivery by such Stockholder, if not
an individual, of this Agreement and the Ancillary Agreements to which such
Stockholder is or is to become a party, the performance of its obligations
hereunder and thereunder, and the Transactions have been duly and validly
authorized by all necessary corporate action on the part of Stockholder. The
Stockholder has the absolute and unrestricted right, power and authority to
execute and deliver this Agreement and the Ancillary Agreements to which it is
or is to become a party and to perform its obligations hereunder and thereunder.
This Agreement has been, and each of the Ancillary Agreements to which the
Stockholder is or is to become a party, when executed and assuming due
authorization, execution and delivery by each other party hereto or thereto,
will be, duly executed and delivered by the Stockholder and constitute valid and
legally binding obligations of the Stockholder enforceable in accordance with
their respective terms, except as such enforceability may be (a) limited by
applicable bankruptcy, insolvency, reorganization, fraudulent transfer and other
laws affecting creditors’ rights generally, and (b) subject to the rules of law
governing specific performance, injunctive relief, or other equitable remedies.
 
4.4   No Conflict; Third Party Consents. The execution and delivery of this
Agreement does not, and the execution and delivery of the Ancillary Agreements
to which the Stockholder is a party will not, and the consummation of the
Transactions will not, (a) violate or conflict with the provisions of the
Stockholder’s Organizational Documents, (b) result in a material breach or
violation by the Stockholder of any of the terms, conditions or provisions of
any applicable Legal Requirement, Governmental Authorization or Governmental
Order, (c) violate or constitute a default under any of the terms or provisions
of, or constitute a default under, any statute, indenture, mortgage, deed of
trust, loan agreement or other agreement or instrument to which such Stockholder
is a party or by which such Stockholder is bound or to which any of the Assets
of such Stockholder is subject, or (d) result in the creation of any Encumbrance
on such Stockholder’s Shares. The Stockholder is not required to give any notice
to any Person, and no consent, approval or authorization of, or registration or
filing with, any Person or Governmental Authority is required in connection with
the execution, delivery or performance by the Purchaser of this Agreement or any
of the Ancillary Agreements to which the Purchaser is or is to become a party or
the consummation of the Transactions.
 
4.5   Brokers. The Stockholder has not agreed or become obligated to pay, or has
taken any action that could reasonably be expected to result in any Person
claiming to be entitled to receive, any brokerage commission, finder’s fee,
financial advisor’s fees or other similar commission or fee in connection with
any of the Transactions.
 
4.6   Investment Representations and Warranties.
 
(a) Purchase for Own Account. The WEBM Shares to be received by the Stockholder
hereunder will be acquired for investment for the Stockholder’s own account, not
as a nominee or agent, and not with a view to the public resale or distribution
thereof in violation of the Securities Act, and the Stockholder has no present
intention of selling, granting any participation in, or otherwise distributing
the same without prejudice, however, to such the Stockholder’s right at all
times to sell or otherwise dispose of WEBM Shares in compliance with applicable
federal and state securities laws. If not an individual, the Stockholder also
represents that the Stockholder has not been formed for the specific purpose of
acquiring WEBM Shares.
 
(b) Disclosure of Information. The Stockholder has had an opportunity to review
the Purchaser SEC Documents and has received or has had full access to all the
information it considers necessary or appropriate to make an informed investment
decision with respect to the WEBM Shares to be received by it under this
Agreement. The Stockholder further has had an opportunity to ask questions and
receive answers from the Purchaser regarding the terms and conditions of the
offering of the WEBM Shares and to obtain additional information (to the extent
the Purchaser possessed such information or could acquire it without
unreasonable effort or expense) necessary to verify any information furnished to
the Stockholder or to which the Stockholder had access.
 
(c) Investment Experience. The Stockholder understands that the WEBM Shares
involve substantial risk. The Stockholder has experience as an investor in
securities of companies like the Purchaser and acknowledges that the Stockholder
is able to fend for itself, can bear the economic risk of such Stockholder’s
investment in the WEBM Shares and has such knowledge and experience in financial
or business matters that such Stockholder is capable of evaluating the merits
and risks of this investment in the WEBM Shares and protecting its own interests
in connection with this investment.
  
 
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(d) Restricted Securities. The Stockholder understands that the WEBM Shares are
characterized as “restricted securities” under the Securities Act inasmuch as
they are being acquired from the Purchaser in a transaction not involving a
public offering and that under the Securities Act such securities may be resold
without registration under the Securities Act only in limited circumstances. In
this connection, the Stockholder represents that the Stockholder is familiar
with Rule 144 promulgated under the Securities Act and understands the resale
limitations imposed thereby and by the Securities Act on the WEBM Shares. The
Stockholder understands that the Purchaser is under no obligation to register
any of the WEBM Shares except as provided in Article X below.
 
(e) Limitations on Disposition. Without in any way limiting the representations
set forth above, the Stockholder further agrees not to make any disposition of
all or any portion of the WEBM Shares unless and until:
 
(i) there is then in effect a registration statement under the Securities Act
covering such proposed disposition and such disposition is made in accordance
with such registration statement and the provisions of Article X of this
Agreement; or
 
(ii) (A) the Stockholder shall have notified the Purchaser of the proposed
disposition and shall have furnished the Purchaser with a statement of the
circumstances surrounding the proposed disposition, and (B) the Stockholder
shall have furnished the Purchaser, at the expense of the Stockholder or its
transferee, with an opinion of counsel, reasonably satisfactory to the
Purchaser, that such disposition will not require registration of such
securities under the Securities Act.
 
(f) Legends. It is understood that the certificates evidencing the WEBM Shares
will bear legends substantially as set forth below:
 
THE SECURITIES REPRESENTED HEREBY HAVE NOT BEEN REGISTERED UNDER THE SECURITIES
ACT OF 1933, AS AMENDED (THE “SECURITIES ACT”), OR UNDER STATE SECURITIES LAWS.
THESE SECURITIES ARE SUBJECT TO RESTRICTIONS ON TRANSFERABILITY AND RESALE AND
MAY NOT BE TRANSFERRED OR RESOLD EXCEPT AS PERMITTED UNDER THE SECURITIES ACT
AND THE APPLICABLE STATE SECURITIES LAWS, PURSUANT TO REGISTRATION OR EXEMPTION
THEREFROM AS EVIDENCED BY A LEGAL OPINION OF COUNSEL TO SUCH EFFECT, WHICH SHALL
BE REASONABLY ACCEPTABLE TO THE WEBMEDIABRANDS INC. INVESTORS SHOULD BE AWARE
THAT THEY MAY BE REQUIRED TO BEAR THE FINANCIAL RISKS OF THIS INVESTMENT FOR AN
INDEFINITE PERIOD OF TIME.
 
The legends set forth above shall, upon the request of the Stockholder, be
promptly removed by the Purchaser from any certificate evidencing WEBM Shares
upon delivery to the Purchaser of an opinion of counsel to the Purchaser if
required under Section 4.6(e) hereof, that the legended security can be freely
transferred in a public sale without a registration statement being in effect
under the Securities Act and in compliance with exemption requirements under
applicable state securities laws and that such transfer will not jeopardize the
exemption or exemptions from registration pursuant to which the Purchaser issued
the WEBM Shares; provided, however, that no such opinion shall be required in
connection with routine sales of WEBM Shares pursuant to the Registration
Statement (as defined below). In connection with any such opinion, the
Stockholder shall provide such certifications as may reasonably be deemed
necessary for the delivery of such opinion.
  
 
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(g) Further Limitations on Disposition. The Stockholder has not and will not
(i) prior to the date the Registration Statement is declared effective by the
SEC, if then prohibited by law or regulation, sell, dispose of, or grant any
right with respect to (collectively, a “Disposition”), its WEBM Shares, nor
(ii) engage in any hedging or other transaction which is designed or could
reasonably be expected to lead to or result in a Disposition by the Stockholder
of its WEBM Shares prior to such date. In addition, the Stockholder represents
that as of the date of this Agreement the Stockholder does not have any existing
short position in the Purchaser’s Common Stock nor has the Stockholder executed
any derivative instruments with any third party, which in either case is
designed to dispose of its WEBM Shares, prior to the date the Registration
Statement is declared effective by the SEC.
 
ARTICLE V
REPRESENTATIONS AND WARRANTIES
OF PURCHASER
 
The Purchaser hereby represents and warrants to Stockholders, subject to the
further exceptions set forth herein and in the Disclosure Schedule, that the
statements contained in this Article V are true, correct and complete as of the
date hereof or, if a representation or warranty is made as of a specified date,
as of such date. Notwithstanding anything to the contrary herein, (1) the
representations and warranties set forth in this Article V are made for the
purpose of allocating contractual risk between the parties hereto and shall not
constitute or be deemed to be an admission of fact to any third party concerning
any item set forth herein and (2) the use and meaning of the term “material”
(and variations thereof) herein may be different from the use and meaning of
such term under applicable securities laws.
 
5.1   Due Organization. The Purchaser is a corporation duly organized, validly
existing and in good standing under the laws of the State of Delaware. The
Purchaser is duly authorized to conduct business and is in good standing in each
jurisdiction where such authorization is required to conduct its business as
presently conducted by it, except where the failure to be so qualified does not
materially and adversely affect the Purchaser.
 
5.2   Due Authorization. The execution and delivery by the Purchaser of this
Agreement and the Ancillary Agreements to which the Purchaser is or is to become
a party, the performance of its obligations hereunder and thereunder, and the
Transactions have been duly and validly authorized by all necessary corporate
action on the part of the Purchaser. The Purchaser has the absolute and
unrestricted right, power and authority to execute and deliver this Agreement
and the Ancillary Agreements to which it is or is to become a party and to
perform its obligations hereunder and thereunder. This Agreement has been, and
each of the Ancillary Agreements to which the Purchaser is or is to become a
party, when executed and assuming due authorization, execution and delivery by
the Stockholders and each other party hereto or thereto, will be, duly executed
and delivered by the Purchaser and constitute valid and legally binding
obligations of the Purchaser enforceable in accordance with their respective
terms, except as such enforceability may be (a) limited by applicable
bankruptcy, insolvency, reorganization, fraudulent transfer and other laws
affecting creditors’ rights generally, and (b) subject to the rules of law
governing specific performance, injunctive relief, or other equitable remedies.
 
5.3   No Conflict; Third Party Consents. The execution and delivery of this
Agreement does not, and the execution and delivery of the Ancillary Agreements
to which the Purchaser is a party will not, and the consummation of the
Transactions will not (a) violate or conflict with the provisions of the
Purchaser’s Organizational Documents, or (b) result in a material breach or
violation by the Purchaser of any of the terms, conditions or provisions of any
applicable Legal Requirement, Governmental Authorization or Governmental Order.
The Purchaser is not required to give any notice to any Person, and no consent,
approval or authorization of, or registration or filing with, any Person or
Governmental Authority is required in connection with the execution, delivery or
performance by the Purchaser of this Agreement or any of the Ancillary
Agreements to which the Purchaser is or is to become a party or the consummation
of the Transactions.
  
 
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5.4   Capitalization.
 
(a) The authorized capital stock of the Purchaser consists of 75,000,000 shares
of Common Stock, par value $.01 per share (the “Purchaser Common Stock”) and
4,000,000 shares of Preferred Stock, par value $.01 per share (the “Purchaser
Preferred Stock”). As of the close of business on May 4, 2011: (i) 38,038,513
shares of Purchaser Common Stock were issued and outstanding (not including the
65,000 shares of Purchaser Common Stock held by the Purchaser in the Purchaser’s
treasury) and no shares of Purchaser Preferred Stock were issued and
outstanding; (ii) all shares of Purchaser Common Stock issuable upon the
exercise of outstanding employee stock options or other rights to purchase or
receive Purchaser Common Stock granted under the Purchaser’s Stock Plans (the
“Purchaser Stock Plans”) have been reserved for issuance; and (iii) 65,000
shares of Purchaser Common Stock were held by the Purchaser in the Purchaser’s
treasury.
 
(b) All outstanding shares of capital stock of the Purchaser are duly
authorized, validly issued, fully paid and nonassessable and not subject to
preemptive rights. Except as set forth in this Section 5.4 and except for
changes resulting from the issuance of shares of Purchaser Common Stock pursuant
to the Purchaser Stock Plans or as expressly permitted by this Agreement, as of
the date hereof (i) there are not issued, reserved for issuance or outstanding
(A) any shares of capital stock or other voting securities of the Purchaser,
(B) any securities of the Purchaser or any the Purchaser’s Subsidiaries
convertible into or exchangeable or exercisable for shares of capital stock or
voting securities of or ownership interests in the Purchaser or any of the
Purchaser’s Subsidiaries, (C) any warrants, calls, options or other rights to
acquire from the Purchaser or any the Purchaser’s Subsidiaries, and any
obligation of the Purchaser or any the Purchaser’s Subsidiaries to issue, any
capital stock, voting securities or other ownership interests in, or securities
convertible into or exchangeable or exercisable for capital stock or voting
securities of or other ownership interests in, the Purchaser or any the
Purchaser’s Subsidiaries, (ii) there are no outstanding obligations of the
Purchaser or any of the Purchaser’s Subsidiaries to repurchase, redeem or
otherwise acquire any such securities or to issue, deliver or sell, or cause to
be issued, delivered or sold, any such securities, including, without
limitation, any offer, issuance or sale in such a manner that would constitute a
public offering under the Securities Act and (iii) except as contemplated in
this Agreement, the Purchaser is not presently under any obligation, has not
agreed or committed, and has not granted rights, to register under the
Securities Act or the Exchange Act, or otherwise file any registration statement
under any such statute covering, any of its currently outstanding capital stock
or other securities or any of its capital stock or other securities that may be
subsequently issued.
 
(c) Except for a nominating agreement to be entered into on or about the date
hereof with Justin L. Smith, neither the Purchaser nor any of the Purchaser’s
Subsidiaries is a party to any agreement restricting the purchase or transfer
of, relating to the voting of, or granting any preemptive or antidilutive rights
with respect to, any securities of the Purchaser or any of the Purchaser’s
Subsidiaries that are outstanding as of the date hereof, or that may be
subsequently issued upon the conversion or exercise of any instrument or
otherwise.
 
5.5   SEC Filings; Financial Statements. The Purchaser has made available
(including via EDGAR) to the Stockholder Representative true and complete copies
of the Purchaser SEC Documents filed with the SEC by the Purchaser on or prior
to the Effective Date. As of their respective filing dates, (a) the Purchaser
SEC Documents complied in all material respects with the requirements of the
Exchange Act and the Securities Act and (b) none of the Purchaser SEC Documents
contained any untrue statement of a material fact related to the Company, or
omitted to state a material fact required to be stated therein or necessary to
make the statements made therein related to the Company, in the light of the
circumstances under which they were made, not misleading, except to the extent
amended or superseded by a subsequently filed Purchaser SEC Document. No
executive officer of the Company has failed to make the certifications required
of him or her under Section 302 or 906 of the Sarbanes-Oxley Act with respect to
any Purchaser SEC Document.  Neither the Purchaser nor any of its executive
officers has received notice from any Governmental Authority challenging or
questioning the accuracy, completeness, form or manner of filing of such
certifications.  As of the date of this Agreement, there are no outstanding
written comments from the SEC with respect to any of the Purchaser SEC
Documents.
  
 
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5.6   Proceedings; Orders. There is no pending Proceeding, and to the Knowledge
of the Purchaser, no Person has threatened to commence any Proceeding: (i) that
involves the Purchaser; or (ii) that challenges, or that would reasonably be
expected to have the effect of preventing, delaying, making illegal or otherwise
interfering with, any of the Transactions. No event has occurred, and to the
Knowledge of the Purchaser, no claim, dispute or other condition or circumstance
exists, that would reasonably be expected to give rise, directly or indirectly,
to or serve as a basis for the commencement of any such Proceeding.
 
5.7   Licenses And Permits; Compliance With Laws. The Purchaser and the
Purchaser’s Subsidiaries hold all permits, licenses, franchises, authorizations
and approvals from all Governmental Entities (the “Purchaser Permits”) which are
necessary for the operation of the businesses of the Purchaser and the
Purchaser’s Subsidiaries as presently conducted and for the Purchaser and the
Purchaser’s Subsidiaries to own, lease and operate their respective properties,
except where the failure to have any such permits, licenses or approvals would
not have a material and adverse effect on the Purchaser. The Purchaser and the
Purchaser’s Subsidiaries are in compliance with the terms of the Purchaser
Permits and all applicable statutes, laws, ordinances, rules and regulations,
except where the failure so to comply would not have a material and adverse
effect on the Purchaser.
 
5.8   Valid Issuances. Assuming the accuracy of the representations and
warranties of the Stockholders in Article IV, the issuance of the Purchaser
Common Stock in the Transactions, when issued in accordance with the provisions
of this Agreement, will be duly authorized, validly issued, fully paid and
nonassessable, and except as set forth on Schedule 2.5 hereto, free of all
Encumbrances and not subject to preemptive rights, and will be exempt from
registration under the Securities Act and applicable state securities laws.
 
5.9   Brokers. The Purchaser has not agreed or become obligated to pay, or taken
any action that could reasonably be expected to result in any Person claiming to
be entitled to receive, any brokerage commission, finder’s fee, financial
advisor’s fees or other similar commission or fee in connection with any of the
Transactions.
 
5.10   Purchase for Own Account. The Shares to be acquired by the Purchaser
hereunder will be acquired for investment for the Purchaser’s own account, not
as a nominee or agent, and not with a view to the public resale or distribution
thereof in violation of the Securities Act, and the Purchaser has no present
intention of selling, granting any participation in, or otherwise distributing
the same without prejudice, however, to Purchaser’s right at all times to sell
or otherwise dispose of the Shares in compliance with applicable federal and
state securities laws.
 
5.11   Full Disclosure.  This Agreement and the Ancillary Agreements, when taken
as a whole, do not contain any untrue statement of fact or omit to state any
fact necessary to make any of the representations, warranties or other
statements or information contained therein not misleading in light of the
circumstances under which made.
  
 
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ARTICLE VI
ADDITIONAL AGREEMENTS
 
6.1   Access to Information. In order to facilitate the resolution of any claims
made against or incurred by the Stockholders with respect to the Company, for a
period of two years after the Effective Date, the Purchaser shall (a) retain the
Business Records relating to periods prior to the Effective Date, and (b) upon
reasonable notice, afford the Stockholder Representative reasonable access
(including the right to make, at the Stockholders expense, photocopies), during
normal business hours, under the supervision of the Purchaser’s personnel and in
such a manner as not to interfere with the normal operations of the Company.
 
6.2   Confidentiality.
 
(a)  As used in this Section 6.2, the term “Confidential Information” includes
any of the following information held or used by or relating to the Company or
Purchaser:
 
(i) all information that is a Trade Secret;
 
(ii) all information concerning product specifications, data, know-how,
formulae, compositions, processes, designs, sketches, photographs, graphs,
drawings, samples, inventions and ideas, past, current, and planned research and
development, current and planned manufacturing or distribution methods and
processes, computer hardware, Software and computer software, database
technologies, systems, structures and architectures; and
 
(iii) all information concerning the business and affairs of the Company or
Purchaser, including historical and current financial statements, financial
projections and budgets, tax returns and accountants’ materials, historical,
current, and projected sales, capital spending budgets and plans, business
plans, strategic plans, marketing and advertising plans, publications, client
and customer and prospect lists and files, current and anticipated customer
requirements, price lists, market studies, Contracts, the names and backgrounds
of key personnel and personnel training techniques and materials, however
documented.
 
(b) Each Stockholder acknowledges the confidential and proprietary nature of the
Confidential Information and agrees that such Stockholder shall, except to the
extent required for a Stockholder who is employed by the Company or Purchaser to
fulfill his or her duties in the course of such employment, from and after the
Closing: (i) keep the Confidential Information confidential and deliver promptly
to Purchaser, or immediately destroy at Purchaser’s option, all embodiments and
copies of the Confidential Information that are in such Stockholder’s
possession; (ii) not use the Confidential Information for any reason or purpose;
and (iii) without limiting the foregoing, not disclose the Confidential
Information to any Person, except with Purchaser’s prior written consent.
 
(c) Section 6.2(b) does not apply to that part of the Confidential Information
that becomes generally available to the public other than as a result of a
Breach of this Section 6.2 by any Stockholder. Confidential Information shall
not be deemed “generally available to the public” merely because it is included
or incorporated in more general information that is publicly available or
because it combines features which individually may be publicly available.
 
(d) If any Stockholder becomes compelled in any Proceeding to make any
disclosure that is prohibited by this Section 6.2, such Stockholder shall, to
the extent legally permissible, provide Purchaser with prompt notice of such
compulsion so that Purchaser may seek an appropriate protective order or other
appropriate remedy or waive compliance with the provisions of this Section 6.2.
In the absence of a protective order or other remedy, such Stockholder may
disclose that portion (and only that portion) of the Confidential Information
that, based upon the opinion of such Stockholder’s counsel, such Stockholder is
legally compelled to disclose; provided, however, that such Stockholder shall
use its best efforts to obtain written assurance that any Person to whom any
Confidential Information is so disclosed shall accord confidential treatment to
such Confidential Information.
  
 
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(e) Nothing in this Section 6.2 will diminish the protections and benefits under
applicable Legal Requirements to which any Trade Secret of the Company or
Purchaser is entitled. If any information that the Company or Purchaser asserts
to be a Trade Secret under applicable Legal Requirements is found by a court of
competent jurisdiction not to be such a Trade Secret, such information will
nonetheless be considered Confidential Information of the Company or Purchaser,
as applicable, for purposes of this Section 6.2.
 
6.3   Further Action; Escrow Agreement.
 
(a) Each of the Parties shall use its reasonable best efforts to satisfy or
cause to be satisfied all the conditions precedent that are set forth in
Article VIII, as applicable to each of them, and to cause the Transactions to be
consummated, and, without limiting the generality of the foregoing, to obtain
all material consents and authorizations of Third Parties and to make all
filings with, and give all notices to, Third Parties that may be necessary or
reasonably required on its part in order to consummate the Transactions on a
timely basis.
 
(b) Each of the Parties shall use its commercially reasonable efforts to take,
or cause to be taken, all appropriate action, to do or cause to be done all
things necessary, proper or advisable under applicable Legal Requirements, and
to execute and deliver, or cause to be executed and delivered, such documents
and other papers as may be required to carry out the provisions of this
Agreement and consummate the Transactions.
 
(c) At all times following the date hereof and extending through the date that
is six (6) months following the expiration of the applicable statute of
limitations for the matters covered in Section 3.15 (Tax Matters) and Article
VII (collectively, the “Tax Indemnity Provisions”), Justin L. Smith, a
Stockholder hereunder, covenants and agrees that he will (i) contribute
additional cash to the Escrow Account from time to time as is required to
maintain a minimum cash balance in the Escrow Account of $300,000, and (ii) to
the extent the cash balance in the Escrow Account is reduced during the first 12
months following the Closing in connection with a successful indemnification
claim by Purchaser pursuant to any Tax Indemnity Provision, contribute
additional cash to the Escrow Account equal to the amount of such successful
indemnification claim (collectively, the “Smith Escrow Funding
Obligations”).  As soon as practicable following the Closing, Purchaser and
Justin L. Smith, as Stockholder Representative and a Stockholder hereunder,
shall in good faith negotiate and execute, with the Escrow Agent, an amendment
to the Escrow Agreement to (i) incorporate therein the Smith Escrow Funding
Obligations and (ii) provide that the term of the Escrow Agreement in connection
with claims pursuant to the Tax Indemnity Provisions shall extend through the
date that is six (6) months following the expiration of the applicable statute
of limitations for the matters covered in the Tax Indemnity Provisions and that
a cash escrow amount of $300,000 shall be retained at all times during such term
for such claims, and (iii) make other conforming changes necessary or
appropriate in connection with the foregoing.
 
6.4   Production of Witnesses and Individuals; Privilege Matters.
 
(a) From and after the Effective Date, each Stockholder, on the one hand, and
the Purchaser, on the other hand, shall make available to each other, upon
written request, if a natural person, himself or herself, and, if not a natural
person, it and its Affiliates’ respective officers, directors, employees and
agents for fact finding, consultation and interviews and as witnesses to the
extent that any such Person may be required in connection with any Proceeding in
which the requesting Party may from time to time be involved relating to the
Stockholders or the Company, prior to or after the Effective Date. Access to
such Persons shall be granted during normal business hours at a location and in
a manner reasonably calculated to minimize disruption to such Persons’
respective businesses. Each Stockholder, on the one hand, and the Purchaser, on
the other hand, agrees to reimburse the other for reasonable and documented
out-of-pocket expenses, including attorneys’ fees, but excluding officers’ or
employees’ salaries, incurred by the other in connection with providing
individuals and witnesses pursuant to this Section 6.4(a).
   
 
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(b) Except as required pursuant to any applicable Legal Requirement, from and
after the Effective Date, the Purchaser shall not intentionally disclose, and
shall not permit any of its Affiliates to disclose intentionally, any documents
or other information (i) that, if disclosed, would cause a waiver of any
privilege that could be asserted under applicable Legal Requirements if such
waiver would reasonably be expected to have an adverse effect on any
Stockholder, (ii) related to the process of the sale of the Company or
(iii) related to a Third Party Claim, the defense of which has been assumed by
Stockholder pursuant to Section 9.6.
 
6.5   Public Disclosure.
 
(a) On or after the date hereof, the Purchaser shall issue a press release
regarding the terms of this Agreement and the Transactions, which press release
shall be approved by the Stockholder Representative prior to its issuance (such
approval not to be unreasonably withheld, delayed or conditioned). The Purchaser
and Stockholder Representative shall consult with each other before issuing any
press release or otherwise making any public statement or making any other
public (or non-confidential) disclosure (whether or not in response to an
inquiry) regarding the terms of this Agreement or any of the Transactions, and
neither shall issue any such press release or make any such statement or
disclosure without the prior approval of the other (which approval shall not be
unreasonably withheld or delayed), except as may be required by Legal
Requirements or by obligations pursuant to any listing agreement with any
national securities exchange, in which case the Party proposing to issue any
such press release or make such public statement or disclosure shall use
commercially reasonable efforts to consult with the other Party before issuing
such press release or making such public statement or disclosure and to
cooperate with the other Party to accommodate any reasonable objections made
thereto.
 
(b) Each Party agrees that it has not and will not denigrate, defame, disparage
or cast aspersions upon any other Party hereto or such other Party’s products,
services, business or manner of doing business to any third party, including,
without limitation, to stockholders, competitors, collaborators and potential
collaborators, customers and potential customers.
 
6.6   Release. In consideration for the Purchase Price, as of and following the
Effective Date, each Stockholder knowingly, voluntarily and unconditionally
releases, forever discharges, and covenants not to sue the Company (but not the
Purchaser or its Affiliates) from or for any and all claims, causes of action,
demands, suits, debts, obligations, liabilities, damages, losses, costs and
expenses (including attorneys’ fees) of every kind or nature whatsoever, known
or unknown, actual or potential, suspected or unsuspected, fixed or contingent,
that such Stockholder has or may have, now or in the future, arising out of,
relating to, or resulting from any act or omission, error, negligence, breach of
contract, tort, violation of law, matter or cause whatsoever, including without
limitation, any claim relating to employment or working as a consultant or
independent contractor or being a Stockholder, officer, director, supplier or
other contractual party with the Company from the beginning of time to the
Effective Date.  The Stockholders also expressly understand and acknowledge that
it is possible that unknown losses or claims exist or that present losses may
have been underestimated in amount or severity, and the Stockholders explicitly
took that into account in giving this release.  The Stockholders waive any and
all rights under Calif. Civil Code § 1542, which provides that:
 
A general release does not extend to claims which the [Stockholder] does not
know or suspect to exist in his favor at the time of executing that release,
which, if known by him, must have materially affected his settlement with the
[Company].
 
6.7   Personal Computers.  After Closing, each Stockholder that is an employee
or consultant of the Purchaser agrees that he or she shall continue to use, and
shall maintain in good working order, his or her personal computer in connection
with the performance of his or her duties to the Purchaser.  The Purchaser may
supply additional computers or related hardware and software in its sole
discretion.
  
 
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ARTICLE VII
TAXES
 
7.1   Tax Periods Ending on or Before the Effective Date. The Stockholders shall
prepare or cause to be prepared and timely file or cause to be timely filed all
Tax Returns for the Company for all Tax periods ending on or prior to the
Effective Date that are filed after the Effective Date (“Pre-Closing Tax
Periods”).
 
7.2   Proration of Taxes. The Purchaser shall prepare or cause to be prepared
and timely file or cause to be timely filed any Tax Returns of the Company for
Tax periods that begin before the Effective Date and end after the Effective
Date (“Straddle Tax Periods”).
 
7.3   Payment of Taxes. The Stockholders shall be responsible for and shall
indemnify the Purchaser from and against, any Tax with respect to the Company
that is attributable to a Pre-Closing Tax Period or to that portion of Straddle
Tax Period that ends on the Effective Date, in each case to the extent that such
Tax exceeds the amount (if any) reflected as a Current Liability for such Tax in
the Unaudited Interim Balance Sheet. Within five (5) Business Days prior to the
due date for the payment of any such Tax, if the amount of such Tax for which
the Stockholders are responsible pursuant to this Section 7.3 exceeds the amount
reflected as a Current Liability for such Tax in the Unaudited Interim Balance
Sheet, the Stockholders shall pay to the Purchaser an amount equal to such
excess. For purposes of this Section 7.3, in the case of any Taxes that are
imposed on a periodic basis and are payable for a Straddle Tax Period, the
portion of such Tax that relates to the portion of such Taxable period ending on
the Effective Date shall (a) in the case of any Taxes other than Taxes based
upon or related to income, receipts, or employment or similar Taxes, be deemed
to be the amount of such Tax for the entire Tax period multiplied by a fraction
the numerator of which is the number of days in the Tax period ending on the
Effective Date and the denominator of which is the number of days in the entire
Tax period, (b) in the case of any Tax based upon or related to income or
receipts, be deemed equal to the amount that would be payable if the relevant
Tax period ended on the Effective Date and (c) in the case of any employment or
similar Taxes of the Company based on the payment or vesting of wages, salaries
or other compensation amounts by or on behalf of the Company, be deemed as
attributable to the date on which the compensation that gave rise to the Tax was
earned or vested and equal to the amount that would be payable if the relevant
Tax period ended on the Effective Date.
 
7.4   Cooperation on Tax Matters. The Purchaser, the Company and the
Stockholders shall (and shall cause their respective Affiliates to) cooperate
fully with each other and make available or cause to be made available to each
other for consultation, inspection and copying (at such other Party’s expense)
in a timely fashion such personnel, Tax data, relevant Tax Returns or portions
thereof and filings, files, books, records, documents, financial, technical and
operating data, computer records and other information as may be reasonably
required (a) for the preparation by such other Party of any Tax Returns or
(b) in connection with any Tax audit or proceeding affecting or concerning one
Party (or an Affiliate thereof) to the extent such Tax audit or proceeding
relates to or arises from the operation of the Company before or after the
Effective Date and/or the transactions contemplated by this Agreement. Any
information made available by one Party (or an Affiliate) to the other Party (or
an Affiliate) pursuant to this Section 7.4 shall be held in strict confidence by
such other Party (or Affiliate) and shall be used solely by such other Party (or
Affiliate) only in connection with the reason for which it was requested.
 
7.5   Transfer Taxes. Any Taxes or recording fees payable as a result of the
purchase and sale of the Shares or any other action contemplated hereby (other
than any federal, state, local or foreign Taxes measured by or based upon
income, gains or wages or similar compensation amounts imposed upon the
Stockholders, the Restricted Stockholders or the Company) shall be allocated
among and paid in equal amounts by the Stockholders and the Purchaser. The
parties shall cooperate in the preparation, execution and filing of all returns,
questionnaires, applications and other documents regarding Taxes and all
transfer, recording, registration and other fees that become payable in
connection with the transactions contemplated hereby that are required or
permitted to be filed at or prior to the Closing.
  
 
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7.6   Retention of Tax Records. After the Effective Date and until the fourth
anniversary thereof or such longer period as the Stockholder Representative may
request in writing for a reasonable business purpose (including, without
limitation, any examination of Tax Returns by a taxing authority or agency), the
Purchaser shall retain possession of all accounting, business, financial and Tax
records and information that come into existence after the Effective Date but
relate to the Company and/or the operation of the Company’s business before the
Effective Date. In addition, from and after the Effective Date, the Purchaser
shall provide to the Stockholder Representative and its Representatives (after
reasonable notice and during normal business hours and without charge to the
Stockholder Representative) access to the books, records, documents and other
information relating to the Company as the Stockholder Representative may
reasonably deem necessary to properly prepare for, file, prove, answer,
prosecute and defend any Tax Return, claim, filing, tax audit, tax protest,
suit, proceeding or answer.
 
7.7   Stockholder Review. To the extent any tax shown as due on any Tax Return
could reasonably be expected to be payable by Stockholders (taking into account
the indemnification obligations hereunder), (a) such Tax Return shall be
provided to the Stockholder Representative at least thirty (30) days prior to
the filing deadline (or, if required to be filed within thirty (30) days of the
Closing, as soon as possible following the Closing), (b) the Stockholder
Representative shall have the right to review and comment on such Tax Return and
(c) the Purchaser shall make such revisions to such Tax Return as are reasonably
requested by Stockholder Representative and not materially adverse to the
Purchaser.
 
7.8   Effect of Disclosure Schedule.  The obligations, responsibilities and
liabilities of the Parties set forth in this Article VII shall apply
notwithstanding, and shall not be limited in any way by, any information or
disclosures set forth on the Disclosure Schedule.
 
ARTICLE VIII
CONDITIONS TO CLOSING
 
8.1   Conditions to Each Party’s Obligations. The obligations of the Purchaser
and Stockholders to consummate the Transactions shall be subject to the
fulfillment or written waiver, at or prior to the Closing, of each of the
following conditions:
 
(a) Stockholder Participation. Each stockholder of the Company shall have
entered into this Agreement.
 
(b) No Order. No Governmental Authority shall have enacted, issued, promulgated,
enforced or entered any Legal Requirement or Governmental Order (whether
temporary, preliminary or permanent) that has the effect of making the
Transactions illegal or otherwise restraining or prohibiting the consummation of
the Transactions.
 
(c) No Proceedings. No action or proceeding before any Governmental Authority
shall have been threatened by any Governmental Authority or instituted by either
any Governmental Authority or any other Person which seeks to prevent or
materially delay the consummation of the Transactions or which challenges the
validity or enforceability hereof and has a reasonable likelihood of being
successful.
 
(d) Governmental Consents and Approval. The Parties and their respective
Subsidiaries shall have timely obtained from any applicable Governmental
Authority all approvals, waivers, consents or indications of non-objection, if
any, necessary for the consummation of, or in connection with, the transactions
contemplated hereby.
  
 
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(e) Due Diligence. Each Party shall be reasonably satisfied with the results of
its financial and legal due diligence investigation, with such satisfaction
determined in such Party’s sole and absolute discretion.
 
8.2   Additional Conditions to the Obligations of the Stockholder. The
obligations of the Stockholders to consummate the Transactions shall be subject
to the fulfillment or written waiver, at or prior to the Closing, of each of the
following additional conditions:
 
(a) Representations, Warranties and Covenants. All of the representations and
warranties of the Purchaser contained in Article V of this Agreement shall be
true and correct in all respects as of the Effective Date, except to the extent
such representations and warranties are expressly made only as of an earlier
date, in which case as of such earlier date.
 
(b) Covenants. The Purchaser shall have performed or complied, in all material
respects, with all of the covenants and agreements required by this Agreement to
be performed or complied with by the Purchaser on or before the Closing.
 
(c) Deliveries. The Purchaser shall have delivered the documents and other items
required pursuant to Section 2.3 hereof.
 
8.3   Additional Conditions to Obligations of Purchaser. The obligations of the
Purchaser to consummate the Transactions shall be subject to the fulfillment or
written waiver, at or prior to the Closing, of each of the following additional
conditions:
 
(a) Representations and Warranties. All of the representations and warranties of
the Stockholders contained in Article III and Article IV of this Agreement shall
be true and correct in all respects as of the Effective Date, except to the
extent such representations and warranties are expressly made only as of an
earlier date, in which case as of such earlier date.
 
(b) Covenants. The Stockholders shall have performed or complied, in all
material respects, with all of the covenants and agreements required by this
Agreement to be performed or complied with by the Stockholders at or before the
Closing.
 
(c) Stockholder Compliance Certificate. Each of the Stockholders shall have
delivered, or caused to be delivered, to the Purchaser a certificate executed by
such Stockholder as to such Stockholder’s compliance with the conditions set
forth in Sections 8.3(a) and 8.3(b).
 
(d) No Material Adverse Effect. Since the Unaudited Interim Balance Sheet Date,
there shall not have occurred any event, development, circumstance or set of
circumstances, which, individually or in the aggregate, has had or would
reasonably be expect to have a Material Adverse Effect.
 
(e) Deliveries. The Stockholders and the Company shall have delivered the
documents and other items required pursuant to Section 2.2 hereof.
 
(f) No Claim Regarding Stock Ownership or Purchase Price. There will not have
been made or threatened by any Third Party any claim asserting that such Third
Party (a) is the holder or the beneficial owner of any equity security of the
Company or any Company Subsidiary or (b) is entitled to all or any portion of
the Purchase Price.
  
 
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ARTICLE IX
INDEMNIFICATION
 
9.1   Survival of Representations and Warranties. The representations and
warranties of the parties contained in (i) Section 3.1 (Due Organization; Power;
No Subsidiaries; Etc.), Section 3.2 (Capitalization), Section 3.26 (Conversion
to Corporation), Section 4.2 (Ownership; Title to Shares), Section 4.3 (Due
Authorization), Section 5.1 (Due Organization), Section 5.2 (Due Authorization),
Section 5.4 (Capitalization) and Section 5.8 (Valid Issuances) shall survive the
Closing without limitation, and (ii) Section 3.15 (Tax Matters), and
Section 3.18 (Environmental Matters) shall survive until six (6) months
following the expiration of the applicable statute of limitations for the
matters covered thereunder, (iii) Sections 3.10 (Intellectual Property;
Software; Privacy), 3.16 (Employee and Labor Matters) and 3.20 (Related Party
Transactions) shall through the second anniversary of the Closing (the
representations collectively identified in subsections (i), (ii) and (iii), the
“Specified Representations”), and (iv) all other representations and warranties
of the Parties shall survive through the eighteen (18) month period following
the Closing; provided that any claim made with reasonable specificity by the
Person seeking to be indemnified within the time periods set forth in this
Section 9.1 shall survive until such claim is finally and fully resolved. All
covenants and agreements contained herein shall survive until fully discharged
or performed. The representations, warranties, covenants and obligations of the
Parties and the rights and remedies that may be exercised by any indemnified
party, shall not be limited or otherwise affected by or as a result of any
information furnished to, or any investigation made by or any knowledge of, any
indemnified party or any of their Representatives.  Justin L. Smith acknowledges
and agrees that the representations and warranties under Section 3.1 (Ownership;
Title to Shares) and Section 3.2 (Due Authorization) of the Restricted Stock
Purchase Agreements survive without limitation under such agreements and that
his indemnification obligations with respect to such provisions correspondingly
survive without limitation hereunder pursuant to Section 9.2(c) below.
 
9.2   Indemnification by Stockholders. The Purchaser and its Affiliates,
Representatives, officers, directors, employees, successors and assigns (each, a
“Purchaser Indemnified Party”) shall be indemnified for and held harmless by (1)
the Stockholders, severally but not jointly, as to Breaches of representations
and warranties identified in subsection (a) below, and (2) Justin L. Smith, as
to matters identified in subsections (b) through (h) below, in each case against
any and all Liabilities, costs or expenses (including reasonable attorneys’
fees), judgments, fines, losses, claims, damages and amounts paid in settlement
(including any Liability relating to third-party claims), but excluding any
incidental, liquidated, special, indirect, punitive or consequential damages or
lost profits (unless such damages or lost profits are part of a Third Party
Claim) (each a “Loss” and, together, “Losses”), arising from or in connection
with:
 
(a) the Breach of any representation or warranty made by the Stockholders under
Article IV hereof;
 
(b) the Breach of any representation or warranty contained in this Agreement,
other than in Article IV hereof,
 
(c) the Breach of any representation or warranty made by any of the Stockholders
under Section 4.2 (Ownership; Title to Shares) or Section 4.3 (Due
Authorization) of this Agreement, or any under Section 3.1 (Ownership; Title to
Shares) or Section 3.2 (Due Authorization) of the Restricted Stock Purchase
Agreements;
 
(d) the Breach of any covenant or agreement made by any of the Stockholders or
the Restricted Stockholders contained in this Agreement or the Restricted Stock
Purchase Agreements, respectively;
 
(e) any liability or obligation of the Company for (i) any Taxes that are the
responsibility of the Stockholders or the Restricted Stockholders pursuant to
Section 7.3, (ii) any Taxes incurred in any Tax period beginning after the
Effective Date, but arising from the settlement or other resolution with any
Governmental Authority of an asserted Tax liability which relates to any Tax
period or portion thereof ending on or before the Effective Date, or (iii) the
unpaid Taxes of any Person under Treasury Regulations Section 1.1502-6 (or any
similar provision of other federal, provincial, state, local or foreign Law), as
a transferee or successor, by Contract or otherwise, in each case whether or not
disclosed to the Purchaser in any Schedules to this Agreement, the Company
Financial Statements or otherwise;
  
 
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(f) the noncompliance with any Legal Requirements related to fraudulent
transfers in respect of the Transactions;
 
(g) any act of fraud by the Stockholder Representative, any Stockholder or any
officer, director, Affiliate or employee of any Stockholder related to this
Agreement or any of the Ancillary Agreements; and
 
(h) failure of the Company to have entered into a valid, enforceable agreement
with any Person who was involved in the creation or development of any of the
Company’s Intellectual Property pursuant to which such Person irrevocably and
unconditionally assigned to the Company all Intellectual Property Rights
pertaining to the Intellectual Property so created or developed by such Person.
 
9.3   Indemnification by Purchaser. The Stockholders and their Affiliates,
Representatives, officers, directors, employees, successors and assigns (each, a
“Stockholder Indemnified Party”) shall be indemnified and held harmless by the
Purchaser for and against any and all Losses, arising from or in connection
with:
 
(a) the Breach of any representation or warranty made by the Purchaser contained
in this Agreement;
 
(b) the Breach of any covenant or agreement made by the Purchaser contained in
this Agreement;
 
(c) any act of fraud by the Purchaser or any officer, director, Affiliate or
employee of the Purchaser related to this Agreement or any of the Ancillary
Agreements; or
 
(d) the operations, actions or omissions of the Company after the Closing,
except to the extent that such Loss is directly or indirectly related to the
operations, actions or omissions of the Company prior to the Closing or a breach
of the representations and warranties made in Article III or Article IV.
 
9.4   Limits on Indemnification.
 
(a) No claim may be asserted nor may any Proceeding be commenced against either
the Stockholders or the Purchaser for breach of any representation, warranty,
covenant or agreement contained herein, unless written notice of such claim or
Proceeding is received by such party describing in reasonable detail the subject
matter of such claim or Proceeding on or prior to the date on which the
representation, warranty, covenant or agreement on which such claim or
Proceeding is based ceases to survive as set forth in Section 9.1, irrespective
of whether the subject matter of such claim or Proceeding shall have occurred
before or after such date.
 
(b) Notwithstanding anything to the contrary contained in this Agreement:
 
(i) in the event of any breach or inaccuracy of any representation or warranty
which includes any qualification as to “materiality” or “Material Adverse
Effect,” for purposes of determining the amount of any Loss with respect to such
breach or inaccuracy, no effect will be given to such qualification as to
“materiality” or a “Material Adverse Effect” contained therein (for the
avoidance of doubt, such qualifications would continue to apply to the
determination as to whether or not a breach or inaccuracy had occurred, but not
in the determination of the amount of the Loss);
  
 
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(ii) an Indemnifying Party shall not be liable for any claim for indemnification
for monetary damages pursuant to Sections 9.2(a) (other than with respect to a
Breach of any representation or warranty made in Section 4.2 or 4.3 hereof),
9.2(b) (other than with respect to a Breach of any representation or warranty
made in Section 3.5(f) or 3.6 hereof), 9.2(h) or 9.3(a), unless and until the
aggregate amount of indemnifiable Losses which may be recovered from the
Indemnifying Party equals or exceeds $75,000 (the “Basket”), after which the
Indemnifying Party shall be liable for the amount of all such Losses including
the Basket;
 
(iii) the maximum aggregate amount of monetary damages for indemnifiable Losses
which may be recovered from an Indemnifying Party arising out of or resulting
from the causes set forth in Sections 9.2(a), 9.2(b) and 9.2(h), other than for
a Breach of a Specified Representation, shall be equal to the aggregate of the
Cash Escrow Amount and the value of the Stock Escrow Amount at the time of such
claim for Loss, and the maximum aggregate amount of monetary damages for
indemnifiable Losses which may be recovered from an Indemnifying Party arising
out of or resulting from the causes set forth in Sections 9.3(a) shall be equal
to the $4,100,000; provided, however, that, for the avoidance of doubt, in
connection with (A) a Breach of a Specified Representation, or (B) claims
pursuant to Sections 9.2(c), 9.2(g) or 9.3(c), the maximum amount of monetary
damages for indemnifiable Losses which may be recovered from an Indemnifying
Party arising out of or resulting from the causes set forth in Sections 9.2 or
9.3, respectively, shall not be subject to such limit;
 
(iv) the Purchase Price adjustment (other than to the extent the adjustment
reduces the aggregate amount available for indemnification as provided in
Sections 9.4(b)(iii)) and Taxes that are the subject of Article VII,
respectively, shall not be subject to this Article IX; and
 
(v) notwithstanding the foregoing, the limitations on damages set forth in
Sections 9.4(b)(ii) and (iii) shall not apply (x) in the case of fraud or other
willful misconduct or (y) to Losses arising from the causes set forth in
Section 9.2(d), 9.2(e), 9.2(g), 9.3(b), 9.3(c) and 9.3(d).
 
(c) No Stockholder (including any officer or director of a Stockholder, if
applicable) shall have any right of contribution, indemnification or right of
advancement from the Company, the Purchaser or any other Purchaser Indemnified
Party with respect to any Loss claimed by a Purchaser Indemnified Party. The
Purchaser (including any officer or director of the Purchaser) shall not have
any right of contribution, indemnification or right of advancement from the
Stockholders or any other Stockholder Indemnified Party with respect to any Loss
claimed by a Stockholder Indemnified Party.
 
(d) Each payment by an Indemnifying Party made pursuant to this Article IX shall
be reduced to the extent of any (i) insurance proceeds actually received by the
Purchaser or the Stockholders, as applicable, (ii) Tax benefits actually
realized by the Company in respect of the Losses giving rise to such payment, or
(iii) reimbursements or similar payments actually received by the Purchaser or
the Stockholders, as applicable, from a third party with respect to such
payment; provided, however, neither the Purchaser nor any Stockholder, as
applicable, shall have any obligation whatsoever to seek any payments from, or
take action with respect to, any insurance policies or third parties in lieu of
or as a condition to receiving a payment from an Indemnifying Party under this
Article IX and any such action shall be at the sole and absolute discretion of
the Purchaser or the Stockholders, as applicable.
 
(e) All amounts due to a Purchaser Indemnified Party as so finally determined
shall be paid first from the Escrow Account until all monies and securities in
such account are exhausted and then, to the extent not limited under
Section 9.4(b), severally and not jointly, by the Stockholders liable hereunder,
in each case by wire transfer within five (5) Business Days following such final
determination; provided, that indemnifiable Losses shall be satisfied out of the
Cash Escrow Amount first, and the Stock Escrow Amount second.
  
 
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9.5   Notice of Loss.
 
(a) An Indemnified Party shall give the Indemnifying Party prompt written notice
of any matter which an Indemnified Party has determined has given or could give
rise to a right of indemnification under this Agreement, stating in reasonable
detail the amount of the Loss, if known, and method of computation thereof, and
containing a reference to the provisions of this Agreement in respect of which
such right of indemnification is claimed or arises (an “Indemnification Claim
Notice”). Any failure on the part of an Indemnified Party to provide notice
promptly shall not limit any of the obligations of the Indemnifying Party,
except to the extent such failure materially prejudices the Indemnifying Party’s
ability to defend such claim.
 
(b) In the event that the Indemnifying Party shall not dispute any Losses or
amounts in the Indemnification Claim Notice, the Indemnifying Party shall as
soon as practicable, but in no event greater than 30 calendar days from receipt
of the Indemnification Claim Notice, remit payment of the amounts of Loss to the
Indemnified Party.
 
(c) In the event that the Indemnifying Party shall disagree with any Losses or
amounts in the Indemnification Claim Notice within 30 calendar days following
receipt of the Indemnification Claim Notice, the Indemnifying Party may deliver
a notice of such disagreement (an “Indemnification Claim Dispute”) setting
forth, in reasonable detail and to the extent practicable, each item or amount
of Loss so disputed by the Indemnifying Party. In the event that the
Indemnifying Party shall deliver to the Indemnified Party an Indemnification
Claim Dispute, the Indemnified Party may either: (i) elect to negotiate any
disputed item(s) and amount(s) of Loss or (ii) refer any disputed item(s) and
amount(s) to arbitration as set forth in Section 9.5(e) below for resolution in
accordance with the terms and conditions thereof.
 
(d) In the event that the Indemnifying Party and the Indemnified Party shall
reach agreement on any of the disputed items and amounts of Loss set forth in
the Indemnification Claim Notice, then (i) the Indemnifying Party and the
Indemnified Party shall (A) execute a memorandum setting forth the resolved
item(s) and/or amount(s) of Loss and (B) refer any remaining disputed item(s)
and amount(s) to arbitration as set forth in Section 9.5(e) below for resolution
in accordance with the terms and conditions thereof and (ii) the Indemnifying
Party shall within 30 calendar days of the execution of such memorandum make the
payment to the Indemnified Party of the agreed upon amount.
 
(e) Resolution of Conflicts.
 
(i) If no agreement between the Indemnifying Party and the Indemnified Party on
the Losses set forth in the Indemnification Claim Notice can be reached after
good faith negotiation and within 30 calendar days after delivery of an
Indemnification Claim Notice, either the Indemnifying Party or the Indemnified
Party may demand arbitration of the matter unless the amount of the Loss that is
at issue is the subject of a pending litigation with a Third Party, in which
event arbitration shall not be commenced until such amount is ascertained or
both parties agree to arbitration, and in either such event the matter shall be
determined by arbitration conducted by one arbitrator mutually agreeable to the
Indemnifying Party and the Indemnified Party. In the event that, within 30
calendar days after submission of any dispute to arbitration, the Indemnifying
Party and the Indemnified Party cannot mutually agree on one arbitrator, then,
within 15 calendar days after the end of such 30 calendar day period, the
Indemnified Party shall select one arbitrator, and the Indemnifying Party shall
select one arbitrator. The two arbitrators so selected shall select a third
arbitrator. If either the Indemnifying Party or the Indemnified Party fails to
select an arbitrator during this 15 calendar day period, then the Indemnifying
Party and the Indemnified Party agree that the arbitration will be conducted by
one arbitrator selected by the Indemnifying Party or the Indemnified Party, as
appropriate. Even after any arbitration begins, the Indemnifying Party and the
Indemnified Party shall retain the right to come to an agreement upon the rights
of the respective parties with respect to each of such claims. Upon reaching
such agreement, a memorandum setting forth such agreement shall be prepared and
signed by both parties and the arbitration shall cease.
 
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(ii) Any such arbitration shall be held in New York, New York, under the rules
then in effect of the American Arbitration Association. Unless otherwise
determined by applicable law, the arbitrator shall determine how all expenses
relating to the arbitration shall be paid. The arbitrator or arbitrators, as the
case may be, shall set a limited time period and establish procedures designed
to reduce the cost and time for discovery while allowing the parties an
opportunity, adequate in the sole judgment of the arbitrator or majority of the
three arbitrators, as the case may be, to discover relevant information in a
reasonably expeditious and cost-effective manner from the opposing parties about
the subject matter of the dispute. The arbitrator, or a majority of the three
arbitrators, as the case may be, shall rule upon motions to compel or limit
discovery and shall have the authority to impose sanctions, including attorneys’
fees and costs, to the same extent as a competent New York State court of law or
equity, should the arbitrators or a majority of the three arbitrators, as the
case may be, determine that discovery was sought without substantial
justification or that discovery was refused or objected to without substantial
justification. The decision of the arbitrator or a majority of the three
arbitrators, as the case may be, as to the validity and amount of any claim in
the Indemnification Claim Notice shall be final, binding, and conclusive upon
the Parties to this Agreement. Such decision shall be written and shall be
supported by written findings of fact and conclusions which shall set forth the
award, judgment, decree or order awarded by the arbitrator. Within 30 calendar
days of a decision of the arbitrator(s) requiring payment by the Indemnifying
Party, the Indemnifying Party shall make the payment to the Indemnified Party.
 
(iii) Judgment upon any award rendered by the arbitrator may be entered in any
court having jurisdiction. The forgoing arbitration provision shall apply to any
dispute among the Indemnifying Party and the Indemnified Party under
this Article IX.
 
9.6   Third Party Claims. If an Indemnified Party shall receive notice of any
Proceeding, audit, claim, demand or assessment (each, a “Third Party Claim”)
against it which may give rise to a claim for Loss under this Article IX, the
Indemnified Party shall give the Indemnifying Party prompt written notice of
such Third Party Claim stating in reasonable detail the amount of the Loss, if
known, and method of computation thereof, and containing a reference to the
provisions of this Agreement in respect of which such right of indemnification
is claimed or arises. The Indemnifying Party shall be entitled to control the
defense of such Third Party Claim through counsel of its choice at its own
expense provided that the Indemnifying Party acknowledges its responsibility to
indemnify the Indemnified Party for such Third Party Claim. If the Indemnifying
Party so undertakes any such defense against a Third Party Claim, the
Indemnified Party may participate in such defense at its own expense. The
Indemnified Party shall cooperate with the Indemnifying Party in such defense
and make available to the Indemnifying Party, at the Indemnifying Party’s
expense, all witnesses, pertinent records, materials and information in the
Indemnified Party’s possession or under the Indemnified Party’s control relating
thereto as is reasonably required by the Indemnifying Party. If the Indemnifying
Party does not undertake such defense and elects to allow the Indemnified Party
to direct the defense of any such claim or proceeding, the Indemnified Party
shall not pay, or permit to be paid, any part of such Third Party Claim unless
the Indemnifying Party consents in writing to such payment, such consent not to
be unreasonably withheld, or unless the Indemnifying Party withdraws from the
defense of such Third Party Claim Liability or unless a final judgment from
which no appeal may be taken by or on behalf of the Indemnifying Party is
entered against the Indemnified Party for such Third Party Claim. If the
Indemnifying Party assumes the defense of any such claims or proceeding pursuant
to this Section 9.6, the Indemnifying Party shall have the power and authority
to settle or consent to the entry of judgment in respect of such claim or
proceeding without the consent of the Indemnified Party if the judgment or
settlement results only in the payment by the Indemnifying Party of money
damages and includes a release of the Indemnified Party from any and all
liability thereunder, and, in all other events, the Indemnifying Party shall not
consent to the entry of judgment or enter into any settlement in respect of a
Third-Party Claim without the prior written consent of the Indemnified Party,
which consent shall not be unreasonably withheld, conditioned or delayed.
  
 
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9.7   Exclusive Remedy. Except as otherwise provided herein, including pursuant
to Article X hereof, the Purchaser and the Stockholders acknowledge and agree
that following the Closing, the indemnification provisions of Section 9.2 and
Section 9.3 shall be the sole and exclusive remedies of the Purchaser and the
Stockholders for any breach by the other Party of the representations and
warranties in this Agreement and for any failure by the other Party to perform
and comply with any covenants and agreements in this Agreement, except that
(a) if any of the provisions of this Agreement are not performed in accordance
with their terms or are otherwise breached, the Parties shall be entitled to
specific performance of the terms hereof in addition to any other remedy at law
or equity and (b) the foregoing clause shall not be deemed a waiver by any Party
of any right or remedy arising by reason of any claim of fraud or intentional
misrepresentation or intentional omissions with respect to this Agreement.
 
9.8   Characterization of Indemnification Payments. The Purchaser and the
Stockholders agree to treat any payment made under this Article IX as an
adjustment to the Purchase Price.
 
ARTICLE X
REGISTRATION RIGHTS
 
10.1   Form S-3 Registration.
 
(a) Registration. The Purchaser shall prepare and file with the SEC on or before
the 90th day following the Closing (the “Filing Date”) and use its commercially
reasonable efforts to have declared effective as soon as practicable thereafter,
a registration statement on Form S-3 (or, if the Purchaser is not then eligible
to use Form S-3, then another appropriate form) providing for the public resale
by the Holders of all of the Registrable Securities (the “Registration
Statement”). The Registration Statement may include securities other than those
held by Holders, so long as all of the Registrable Securities are covered by
such Registration Statement. The Purchaser shall use commercially reasonable
efforts to keep the Registration Statement continuously effective (subject to
Section 10.1(b)), pursuant to the Securities Act and the rules and regulations
promulgated thereunder, until (i) the date when all of the Registrable
Securities cease to meet the definition of Registrable Securities, or (ii) the
Purchaser’s obligations hereunder terminate under Section 10.5 hereof. In the
event that the Registration Statement shall cease to be effective, the Purchaser
shall promptly prepare and file a new registration statement covering the
Registrable Securities and shall use commercially reasonable efforts to have
such registration statement declared effective as soon as possible. Any such
registration statement shall be considered a “Registration Statement” hereunder.
 
(b) Blackout Notice. In the event (i) that the Purchaser concludes that it is
necessary for the Purchaser to supplement the Prospectus or make an appropriate
filing under the Exchange Act so as to cause the Prospectus to become current,
or (ii) that, in the judgment of the Purchaser’s Chief Executive Officer or the
Purchaser’s Board of Directors, it is advisable to suspend use of the Prospectus
for a discrete period of time due to undisclosed pending corporate developments
or pending public filings with the SEC (which need not be described in detail),
the Purchaser shall deliver a written notice (the “Blackout Notice”) to the
Holders to the effect of the foregoing and, upon delivery of the Blackout
Notice, the Holders shall not sell any WEBM Shares pursuant to the Prospectus
and shall not disclose to any third party that such a notice has been given or
the contents of the notice. Following delivery of the Blackout Notice, the
Holders shall once again be entitled to sell WEBM Shares pursuant to the
Prospectus (as amended or supplemented) upon the Holder’s receipt of copies of
the supplemented or amended Prospectus, or at such time as the Holders are
advised in writing by the Purchaser that the Prospectus may be used, and at such
time as the Holders have received copies of any additional or supplemental
filings that are incorporated or deemed incorporated by reference in such
Prospectus and which are required to be delivered as part of the Prospectus. In
any event, such restrictions shall terminate no later than 60 days after the
date of delivery of the Blackout Notice. In no event shall the Purchaser be
entitled to deliver more than three Blackout Notices during any 12-month period.
  
 
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(c) Expenses. The registration fees and expenses incurred by the Purchaser in
connection with the Registration Statement and actions taken by the Purchaser in
connection with each Blackout Notice shall be borne by the Purchaser. Each
Holder shall be responsible for any fees and expenses of its counsel or other
advisers, and for any fees, commissions and expenses of its broker, underwriter
or agent related to sale of its shares.
 
10.2   Obligations of the Purchaser. Whenever required to effect the
registration of any Registrable Securities under this Agreement, the Purchaser
shall, as expeditiously as reasonably possible:
 
(a) Furnish to each Holder a complete copy of each registration statement and
all amendments and supplements thereto, and such number of copies of a
Prospectus, including a preliminary Prospectus, in conformity with the
requirements of the Securities Act, and such other documents as it may
reasonably request in order to facilitate the disposition of the Registrable
Securities owned by it that are included in such registration.
 
(b) Use commercially reasonable efforts to register and qualify the securities
covered by such registration statement under such other securities or blue sky
laws of such jurisdictions in the United States as shall be reasonably requested
by the Holders, provided that the Purchaser shall not be required in connection
therewith or as a condition thereto to qualify to do business or to file a
general consent to service of process in any such jurisdictions.
 
(c) Notify the Holders promptly (i) of any request by the SEC or any other
federal or state governmental authority during the period of effectiveness of a
registration statement for amendments or supplements to such registration
statement or related prospectus or for additional information, (ii) of the
issuance by the SEC or any other federal or state governmental authority of any
stop order suspending the effectiveness of a registration statement or the
initiation of any proceedings for that purpose and (iii) of the receipt by the
Purchaser of any notification with respect to the suspension of the
qualification or exemption from qualification of any of the Registrable
Securities for sale in any jurisdiction or the initiation or threatening of any
proceeding for such purpose.
 
(d) Use commercially reasonable efforts to obtain the withdrawal of any order
suspending the effectiveness of the Registration Statement as soon as
practicable.
 
(e) Use its commercially reasonable efforts to list the Registrable Securities
on each securities exchange on which the Common Stock of the Purchaser is then
listed.
 
10.3   Furnish Information. It shall be a condition precedent to the obligations
of the Purchaser to take any action pursuant to Section 10.1 that the Holders
shall furnish to the Purchaser such information regarding it, the Registrable
Securities held by it, and the intended method of disposition of such securities
as shall be required to timely effect the registration of its Registrable
Securities.
 
10.4   Indemnification. In the event any Registrable Securities are included in
a registration statement under this Agreement:
 
(a) By the Purchaser. To the extent permitted by law, the Purchaser will
indemnify and hold harmless the Holders, the officers, directors, agents,
investment advisors, partners, members, managers and employees of each Holder
and each person, if any, who controls the Holders or such persons (such persons
and entities referred to as “Holder Indemnified Parties”), against any Losses,
insofar as such Losses (or actions in respect thereof) arise out of any claim,
action or proceeding brought by a third party arising out of or based upon any
of the following statements, omissions or violations (collectively a
“Violation”):
  
 
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(i) any untrue statement or alleged untrue statement of a material fact
contained in a registration statement, including, without limitation, the
Prospectus, filed pursuant to this Article X;
 
(ii) the omission or alleged omission to state in a registration statement,
including, without limitation, the Prospectus, filed pursuant to this Article X
a material fact required to be stated therein, or necessary to make the
statements therein not misleading in light of the circumstances; or
 
(iii) any violation or alleged violation by the Purchaser of the Securities Act,
the Exchange Act, any federal or state securities law or any rule or regulation
promulgated under the Securities Act, the Exchange Act or any federal or state
securities law, in each case in connection with the offering covered by such
registration statement;
 
 
and the Purchaser will reimburse each Holder Indemnified Party for any legal or
other expenses reasonably incurred by them in connection with investigating or
defending any such Violation; provided, however, that the indemnity agreement
contained in this subsection shall not apply to amounts paid in settlement of
any such Loss, if such settlement is effected without the consent of the
Purchaser, which shall not be unreasonably withheld or delayed, nor shall the
Purchaser be liable in any such case for any such Loss to the extent that it
arises out of or is based upon a Violation which occurs in reliance upon and in
conformity with written information furnished expressly for use in connection
with such registration statement or any other document filed with or furnished
to the SEC by such Holder Indemnified Party; and provided further, that the
Purchaser will not be liable for the reasonable legal fees and expenses of more
than one counsel to the Holder Indemnified Parties.
(b) By the Holders. To the extent permitted by law, each Holder will, severally
and not jointly, indemnify and hold harmless the Purchaser, each of its
officers, directors, agents and employees, and each person, if any, who controls
the Purchaser or such persons (such persons and entities referred to as
“Purchaser Indemnified Parties”) against any Losses to which such Purchaser
Indemnified Parties may become subject, insofar as such Losses (or actions in
respect thereto) arise out of or are based upon any Violation, in each case to
the extent (and only to the extent) that such Violation occurs in reliance upon
and in conformity with written information furnished by such Holders expressly
for use in connection with such registration statement or any other document
filed with or furnished to the SEC; and such Holders will reimburse any legal or
other expenses reasonably incurred by such Purchaser Indemnified Parties in
connection with investigating or defending any such Violation. ; provided,
however, that the indemnity agreement contained in this subsection shall not
apply to amounts paid in settlement of any such Loss if such settlement is
effected without the consent of the Holders, which shall not be unreasonably
withheld or delayed; provided further, that the Holders shall not be liable for
the reasonable legal fees and expenses of more than one counsel to the Purchaser
Indemnified Parties; and provided further, that the total amounts payable in
indemnity by a Holder under this subsection in respect of all Violations shall
not exceed the proceeds received by such Holder in the registered offering out
of which such Violations arise.
  
 
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(c) Notice. Promptly after receipt by an indemnified party under this Section of
notice of the commencement of any action (including any governmental action),
such indemnified party will, if a claim for indemnification in respect thereof
is to be made against any indemnifying party under this Section, deliver to the
indemnifying party a written notice of the commencement of such an action, and
the indemnifying party shall have the right to participate in, and, to the
extent the indemnifying party so desires, jointly with any other indemnifying
party similarly noticed, to assume the defense thereof with counsel selected by
the indemnifying party and reasonably acceptable to a majority in interest of
the indemnified parties; provided, however, that the indemnified parties shall
have the right to retain counsel, with the reasonable fees and expenses of a
single such counsel to be paid by the indemnifying party, if the indemnified
party has been advised in writing by counsel that representation of such
indemnified party by the counsel retained by the indemnifying party would be
inappropriate due to actual conflict of interests between such indemnified party
and any other party represented by such counsel in such proceeding. The failure
to deliver written notice to the indemnifying party within a reasonable time of
the commencement of any such action shall relieve such indemnifying party of
liability to the indemnified party under this Section to the extent such delay
caused material prejudice to the indemnifying party.
 
(d) Defect Eliminated in Final Prospectus. The foregoing indemnity agreements of
the Purchaser and the Holders are subject to the condition that, insofar as they
relate to any Violation made in a prospectus but eliminated or remedied in a
free-writing prospectus, an amended prospectus or a prospectus supplement on
file with the SEC (the “Final Prospectus”), such indemnity agreements shall not
inure to the benefit of any person if a copy of the Final Prospectus was
furnished in a timely manner to the indemnified party and was not furnished to
the person asserting the loss, liability, claim or damage at or prior to the
time such action is required by the Securities Act.
 
(e) Survival. The obligations of the Purchaser and the Holders under this
Section shall survive the completion of any offering of Registrable Securities
in a registration statement, and otherwise.
 
(f) Contribution. If the indemnification provided for in this Section is held by
a court of competent jurisdiction to be unavailable to an indemnified party with
respect to any Losses, then the indemnifying party, in lieu of indemnifying such
indemnified party hereunder, shall contribute to the amount paid or payable by
such indemnified party as a result of such Losses in such proportion as is
appropriate to reflect the relative fault of the indemnifying party on the one
hand and of the indemnified party on the other in connection with the Violation
that resulted in such Losses, as well as any other relevant equitable
considerations; provided, however, that in no event shall any contribution under
this Section from a Holder, together with the amount of any indemnification
payments made by such Holder pursuant to this Section, exceed the proceeds from
the offering received by such Holder. The relative fault of the indemnifying
party and of the indemnified party shall be determined by reference to, among
other things, whether the Violation relates to information supplied by the
indemnifying party or the indemnified party and the parties relative intent,
knowledge, access to information, and opportunity to correct or prevent such
Violation.
 
10.5   Termination of Purchaser’s Obligations. The Purchaser shall have no
obligation to register, or maintain, a registration statement governing
Registrable Securities, subject to the earlier to occur of: (a) if all
Registrable Securities have been registered and sold pursuant to Rule 144 or
registrations effected pursuant to this Agreement, or (b) one year after the
date of the Closing.
  
 
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ARTICLE XI
STOCKHOLDER REPRESENTATIVE
11.1   Stockholder Representative.
 
(a) The Stockholders, by the approval and adoption of this Agreement, authorize
the Stockholder Representative to (i) enter into the Escrow Agreement, (ii) take
all action necessary to consummate the transactions contemplated hereby or under
the Escrow Agreement, or the defense and/or settlement of any claims for which
the Stockholders may be required to indemnify the Purchaser or any other
Indemnified Party pursuant to Article IX, (iii) give and receive all notices
required to be given under this Agreement, and (iv) take any and all additional
action as is contemplated to be taken by or on behalf of the holders of Shares
by the terms of this Agreement or on behalf of the Stockholders pursuant to the
Escrow Agreement.
 
(b) All decisions and actions by the Stockholder Representative, including
without limitation, (i) any agreement between the Stockholder Representative and
the Purchaser relating to the defense or settlement of any claims for which the
Stockholders may be required to indemnify the Purchaser pursuant to Article IX,
and (ii) any agreement by the Stockholder Representative, the Purchaser and/or
the Escrow Agent relating to the Escrow Amount, the Escrow Account or any other
issue, term or provision under the Escrow Agreement, shall be binding upon all
of the Stockholders, and no Stockholder shall have the right to object, dissent,
protest or otherwise contest the same.
 
(c) The Stockholder Representative shall not have any liability to any of the
parties hereto or to the Stockholders for any act done or omitted hereunder as
Stockholder Representative while acting in good faith and in the exercise of
reasonable judgment, and any act done or omitted pursuant to the advice of
counsel shall be conclusive evidence of such good faith. The Stockholders shall
severally indemnify the Stockholder Representative and hold it harmless against
any loss, liability or expense incurred without gross negligence or bad faith on
the part of the Stockholder Representative and arising out of or in connection
with the acceptance or administration of its duties hereunder and under the
Escrow Agreement.
 
(d) Subject to the terms and provisions of the Escrow Agreement and this
Section 11.1, each Stockholder and Restricted Stockholder agree to severally
reimburse the Stockholder Representative for all reasonable out-of-pocket
expenses incurred by the Stockholder Representative in the performance of its
duties hereunder, including reasonable expenses incurred prior to the execution
of this Agreement in relation to the engagement of the Stockholder
Representative and the review or execution of the agreements related to such
engagement (“Reimbursable Expenses”). Without limiting the foregoing, the
Stockholder Representative shall have the right to engage legal counsel and
other professional advisers to assist it in the administration of the
Stockholder Representative’s duties hereunder (including the assessment,
litigation and/or settlement of any claims against the Escrow Fund), and any and
all reasonable fees and expenses of such counsel and advisers shall be deemed
Reimbursable Expenses.  The Stockholder Representative is expressly authorized
to rely upon the advice of legal counsel and other professional advisers engaged
by him. The Stockholder Representative shall be indemnified and held harmless by
the Stockholders severally from and against any Losses that may be incurred by
the Stockholder Representative arising out of or in connection with the
acceptance or performance of the Stockholder Representative’s duties or the
transactions contemplated by this Agreement or the Escrow Agreement, except as
caused by the Stockholder Representative’s gross negligence or willful
misconduct, including the legal costs and expenses of defending such Stockholder
Representative against any claim or liability in connection with the acceptance
or performance of the Stockholder Representative’s duties or the transactions
contemplated by this Agreement or the Escrow Agreement.
  
 
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(e) The Stockholder Representative shall have full power and authority on behalf
of each Stockholder to take any and all actions on behalf of, execute any and
all instruments on behalf of, and execute or waive any and all rights of, the
Stockholders under this Agreement and the Escrow Agreement.
 
(f) By his, her or its approval of this Agreement and the Escrow Agreement and
the transactions contemplated hereby and thereby, each Stockholder agrees, in
addition to the foregoing, that:
 
(i) The Purchaser shall be entitled to rely conclusively on the instructions and
decisions of the Stockholder Representative as to (i) the settlement of any
claims for indemnification by the Purchaser pursuant to Article IX or any term
or provision of the Escrow Agreement, (ii) actions taken relating to the release
and payment of monies from the Escrow Account under the Escrow Agreement, or
(iii) any other actions required or permitted to be taken by the Stockholder
Representative hereunder or under the Escrow Agreement, and no Stockholder shall
have any cause of action against the Purchaser for any action taken by the
Purchaser in reliance upon the instructions or decisions of the Stockholder
Representative;
 
(ii) all actions, decisions and instructions of the Stockholder Representative
shall be conclusive and binding upon all of the Stockholders and no Stockholder
shall have any cause of action against the Stockholder Representative for any
action taken, decision made or instruction given by the Stockholder
Representative under this Agreement or the Escrow Agreement except for fraud or
willful misconduct by the Stockholder Representative in connection with the
matters described in this Section 11.1;
 
(iii) the provisions of this Section 11.1 are independent and severable, are
irrevocable and coupled with an interest and shall be enforceable
notwithstanding any rights or remedied that any Stockholder may have in
connection with the transactions contemplated by this Agreement or the Escrow
Agreement; and
 
(iv) the provisions of this Section 11.1 shall be binding upon the executors,
heirs, legal representatives, personal representatives, successor trustees and
successors of each Stockholder, and any reference in this Agreement to a
Stockholder or the Stockholders shall mean and include the successors to the
rights of the Stockholders hereunder, whether pursuant to testamentary
disposition, the laws of descent and distribution or otherwise.
 
ARTICLE XII
GENERAL PROVISIONS
 
12.1   Notices. All notices, requests, claims, demands and other communications
hereunder shall be in writing and shall be given or made (and shall be deemed to
have been duly given or made upon receipt between 9:00 am and 5:00 pm local time
on a Business Day, or at 9:00 am local time on the next Business Day if
delivered other than between 9:00 am and 5:00 pm local time on a Business Day)
by delivery in person, by an internationally recognized overnight courier
service, by facsimile or registered or certified mail (postage prepaid, return
receipt requested) to the respective Parties at the following addresses (or at
such other address for a Party as shall be specified in a notice given in
accordance with this Section 12.1):
 
(a) if to the Purchaser:
 
WebMediaBrands Inc.
50 Washington Street
South Norwalk, CT 06854
Facsimile: (203) 831-0252
Attention: General Counsel
  
 
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with a copy (which shall not constitute notice) to:
 
Wyrick Robbins Yates & Ponton LLP
4101 Lake Boone Trail, Suite 300
Raleigh, North Carolina 27607
Facsimile: (919) 781-4865
Attention: David L. Wilke, Esq.
 
(b) if to the Stockholders:
 
Inside Network, Inc.
2328 Williams Street
Palo Alto, California 94306
Facsimile:
Attention: Justin L. Smith and Eric Eldon
 
with a copy (which shall not constitute notice) to:
 
Jones Day
1755 Embarcadero Road
Palo Alto, CA 94303
Facsimile: (650) 739-3900
Attention: R. Todd Johnson, Esq.
 
(c) if to the Stockholder Representative:
 
Inside Network, Inc.
2328 Williams Street
Palo Alto, California 94306
Facsimile: (650) 618-2788
Attention: Justin L. Smith
 
with a copy (which shall not constitute notice) to:
 
Jones Day
1755 Embarcadero Road
Palo Alto, CA 94303
Facsimile: (650) 739-3900
Attention: R. Todd Johnson, Esq.
 
12.2   Severability. If any term or other provision of this Agreement is
invalid, illegal or incapable of being enforced by any applicable Legal
Requirement or public policy, all other terms and provisions of this Agreement
shall nevertheless remain in full force and effect for so long as the economic
or legal substance of the Transactions is not affected in any manner materially
adverse to any of the Parties. Upon such determination that any term or other
provision is invalid, illegal or incapable of being enforced, the Stockholder
Representative and the Purchaser shall negotiate in good faith to modify this
Agreement so as to effect the original intent of the Parties as closely as
possible in an acceptable manner in order that the Transactions are consummated
as originally contemplated to the greatest extent possible.
 
12.3   Entire Agreement. This Agreement, the Ancillary Agreements and the
Confidentiality Agreement constitute the entire agreement of the Parties with
respect to the subject matter hereof and thereof and supersede all prior
agreements and undertakings, both written and oral, among the Stockholders, the
Stockholder Representative and the Purchaser with respect to the subject matter
hereof and thereof.
  
 
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12.4   Assignment. This Agreement may not be assigned by operation of law or
otherwise without the express written consent of Stockholder Representative and
the Purchaser (which consent may be not be unreasonably withheld), as the case
may be; provided, however, that, the Purchaser may assign this Agreement without
the consent of the Stockholder Representative to (i) an Affiliate, provided that
no such assignment shall relieve the Purchaser of its obligations hereunder, or
(ii) the buyer or surviving entity in connection with a merger (or other change
of control of the Purchaser) or the sale of all or substantially all of the
Purchaser’s assets.
 
12.5   Amendment. This Agreement may not be amended or modified except (a) by an
instrument in writing signed by, or on behalf of, Stockholder Representative and
the Purchaser or (b) by a waiver in accordance with Section 12.6.
 
12.6   Waiver. Either the Stockholder Representative or the Purchaser may
(a) extend the time for the performance of any of the obligations or other acts
of the other Party, (b) waive any inaccuracies in the representations and
warranties of the other Party contained herein or in any document delivered by
the other Party pursuant hereto or (c) waive compliance with any of the
agreements of the other Party or conditions to such Party’s obligations
contained herein. Any such extension or waiver shall be valid only if set forth
in an instrument in writing signed by the Party to be bound thereby. Any waiver
of any term or condition shall not be construed as a waiver of any subsequent
breach or a subsequent waiver of the same term or condition, or a waiver of any
other term or condition of this Agreement. The failure of any Party to assert
any of their rights hereunder shall not constitute a waiver of any of such
rights.
 
12.7   No Third Party Beneficiaries. This Agreement shall be binding upon and
inure solely to the benefit of the Parties and their respective successors and
permitted assigns and nothing herein, express or implied (including the
provisions of Article IX), is intended to or shall confer upon any other Person
any legal or equitable right, benefit or remedy of any nature whatsoever,
including any rights of employment for any specified period, under or by reason
of this Agreement.
 
12.8   Currency. Unless otherwise specified in this Agreement, all references to
currency, monetary values and dollars set forth herein shall mean United States
(U.S.) dollars and all payments hereunder shall be made in United States
dollars.
 
12.9   Governing Law. This Agreement shall be solely governed by, and solely
construed in accordance with, the laws of the State of New York (without
reference to principles of conflicts of laws) and any action brought to enforce
any provision of this Agreement shall be commenced and maintained only in a
state or federal court located in the Borough of Manhattan, City of New York,
State of New York. The Parties agree and consent to the exclusive jurisdiction
of such courts and agree not to plead in any action related to this Agreement
that such courts are an unfit or inconvenient forum for the resolution of any
such action.
 
12.10   Waiver of Jury Trial. Each of the Parties hereby waives to the fullest
extent permitted by applicable law any right it may have to a trial by jury with
respect to any litigation directly or indirectly arising out of, under or in
connection with this Agreement or the transactions. Each of the Parties hereby
(a) certifies that no representative of the other Party has represented,
expressly or otherwise, that such other Party would not, in the event of
litigation, seek to enforce the foregoing waiver and (b) acknowledges that it
has been induced to enter into this Agreement and the transactions, as
applicable, by, among other things, the mutual waivers and certifications in
this Section 12.10.
 
12.11   Counterparts. This Agreement may be executed and delivered (including by
facsimile or other electronic transmission) in two or more counterparts, each of
which when executed shall be deemed to be an original, but all of which taken
together shall constitute one and the same agreement.
  
 
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12.12   Further Assurances. Each Party shall execute and/or cause to be
delivered to each other Party such instruments and other documents, and shall
take such other actions, as such other Party may reasonably request (prior to,
at or after the Closing) for the purpose of carrying out or evidencing any of
the Transactions.
 
12.13   Fees and Expenses. Each party to this Agreement shall bear and pay all
fees, costs and expenses (including legal fees and accounting fees) that have
been incurred or that are incurred by such party in connection with the
transactions contemplated by this Agreement; provided, however, that the
Stockholders shall be responsible for all Transaction Expenses.
 
12.14   Attorney Fees. If any Proceeding relating to this Agreement or any of
the Ancillary Agreements or the enforcement of any provision of any of this
Agreement or any of the Ancillary Agreements is brought against any Party, the
prevailing Party shall be entitled to recover reasonable attorneys’ fees, costs
and disbursements (in addition to any other relief to which the prevailing Party
may be entitled).
 
12.15   Specific Performance. The Parties agree that irreparable damage may
occur in the event that any of the provisions of this Agreement were not
performed in accordance with their specific terms or were otherwise breached and
that money damages may not be an adequate remedy therefore. It is accordingly
agreed that the Parties hereto shall be entitled to seek an injunction or
injunctions to prevent breaches of this Agreement by the other Party and to seek
to enforce specifically the terms and provisions of this Agreement against the
other Party, this being in addition to any other remedy to which it is entitled
at law or in equity.
 
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IN WITNESS WHEREOF, the undersigned have caused this Agreement to be executed as
of the date first written above by their respective officers thereunto duly
authorized.
 

   
PURCHASER:
WebMediaBrands Inc., a Delaware corporation
 
By: /s/ Alan M. Meckler
Name: Alan M. Meckler
Tile: CEO
         
STOCKHOLDERS:
 
/s/ Justin L. Smith
Justin L. Smith
  
/s/ Eric Eldon
Eric Eldon
         
STOCKHOLDER REPRESENTATIVE:
  
/s/ Justin L. Smith
Justin L. Smith

 
 
 
 
 

 

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