EXHIBIT 10.36
PURCHASE AND SALE AGREEMENT
     PURCHASE AND SALE AGREEMENT (the “Agreement”), dated as of December 9, 2005
by and among HarbourVest VII Venture Ltd., a Bermuda corporation, HarbourVest
Partners VII-Venture Partnership Fund L.P., a Delaware limited partnership, and
Dover Street VI L.P., a Delaware limited partnership (each a “Buyer” and
collectively, the “Buyers”), and Safeguard Scientifics (Delaware), Inc., a
Delaware corporation, Bonfield VII, Ltd. (formerly known as Bonfield Insurance,
Ltd.), a British Virgin Islands international business company, Safeguard Fund
Management, L.P., a Delaware limited partnership, SFINT, Inc., a Delaware
corporation, TL Ventures Management, L.P., a Delaware limited partnership,
Bonfield Partners Capital, L.P., a Delaware limited partnership, and Bonfield
Fund Management, L.P., a Delaware limited partnership (each a “Seller” and
collectively, the “Sellers”).
     WHEREAS, each Seller listed on Exhibit A-1 hereto (each an “LP Interest
Seller” and collectively, the “LP Interest Sellers”) is a limited partner of the
partnerships listed on Exhibit A-1 hereto (the “LP Interest Partnerships”), and
each such Seller is the legal and beneficial owner of the applicable limited
partnership interests in the LP Interest Partnerships, as indicated on
Exhibit A-1, requiring the holders of such interests to make contributions to
the capital of the LP Interest Partnerships in the aggregate amounts set forth
on Exhibit A-1 hereto under the column entitled “Aggregate Commitment” (each, an
“LP Interest” and collectively, the “LP Interests”); and
     WHEREAS, each Seller listed on Exhibit A-2 hereto (each an “Assigned
Interest Seller” and collectively, the “Assigned Interest Sellers”) is the
assignee of certain economic rights and obligations from the respective general
partners of the partnerships listed on Exhibit A-2 hereto (the “Assigned
Interest Partnerships” and together with the LP Interest Partnerships, the
“Partnerships”), relating to such Assigned Interest Partnerships, in each case
as more specifically set forth on Exhibit A-2 (each, an “Economic Interest” and
collectively, the “Economic Interests”); and
     WHEREAS, each LP Interest Seller holds its LP Interests pursuant to the
terms of the applicable agreement and the amendments thereto listed on
Exhibit C-1 hereto (each, as so amended, a “LP Partnership Agreement” and
collectively, the “LP Partnership Agreements”), by and among the respective
parties to such Partnership Agreements as general and limited partners; and
     WHEREAS, each Assigned Interest Seller holds an Economic Interest in the
applicable Assigned Interest Partnership pursuant to the terms of the applicable
agreement listed on Exhibit C-2 hereto (each an “Assignment and Assumption
Agreement” and collectively, the “Assignment and Assumption Agreements”), by and
among the respective parties to such Assignment and Assumption Agreements as
transferors and transferees; and
     WHEREAS, each of the Assigned Interest Partnership’s governing documents
and the amendments thereto is listed on Exhibit C-3 hereto (each, as so amended,
an “Assigned Interest

 

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Partnership Agreement” and collectively, the “Assigned Interest Partnership
Agreements” and together with the LP Partnership Agreements, the “Partnership
Agreements”); and
     WHEREAS, each Seller wishes to sell, assign, convey and transfer to the
applicable Buyer: (a) all of such Seller’s LP Interests in each of the LP
Interest Partnerships, and (b) certain of such Seller’s Economic Interests in
the Assigned Interest Partnerships as more specifically set forth on Exhibit A-2
(the “Assigned Interests”) (each of the interests described in clauses (a) and
(b) herein are referred to in this Agreement as a “Transferred Interest” and
collectively as, the “Transferred Interests”), and each Buyer wishes to
purchase, obtain and acquire from the applicable Seller the applicable
Transferred Interests;
     NOW, THEREFORE, in consideration of the mutual promises and covenants
contained herein, the receipt and sufficiency of which are hereby acknowledged,
each Seller and each Buyer, severally and not jointly, agrees as follows:
     1. Special Provision Regarding Buyers and Sellers.
     (a) For purposes of clarification, with respect to any representation,
warranty, covenant or agreement made by or for the benefit of a Buyer and any
condition to an obligation of a Buyer, such representation, warranty, covenant
or agreement is being made only by or for the benefit, and such condition to an
obligation is only a condition to the obligation, of such Buyer with respect to
the Transferred Interests set forth opposite the name of such Buyer in Exhibits
A-1 and A-2 and only to or for the benefit of the Seller selling such
Transferred Interest; and any and all obligations and liabilities of the Buyers
set forth herein shall be several and not joint. Notwithstanding the foregoing,
this provision shall not be construed to permit the purchase by the Buyers of
less than all of the Transferred Interests.
     (b) For purposes of clarification, with respect to any representation,
warranty, covenant or agreement made by or for the benefit of a Seller and any
condition to an obligation of a Seller, such representation, warranty, covenant
or agreement is being made only by or for the benefit, and such condition to an
obligation is only a condition to the obligation, of such Seller with respect to
the Transferred Interests set forth opposite the name of such Seller in Exhibits
A-1 and A-2 and only to or for the benefit of the Buyer purchasing such
Transferred Interest; and any and all obligations and liabilities of the Sellers
set forth herein shall be several and not joint. Notwithstanding the foregoing,
this provision shall not be construed to permit the sale by the Sellers of less
than all of the Transferred Interests.
     2. Sale and Purchase.
     (a) (i) Subject to the terms and conditions contained herein, the
applicable Seller shall sell, assign, convey and transfer to the applicable
Buyer, its successors and assigns, all of its right, title and interest in and
to the applicable Transferred Interests, including, from and after the Closing
Date (as defined below), all allocations of profits and losses, and
distributions of cash or other property, in respect of the applicable
Transferred Interests, and all other rights otherwise accruing to such Seller by
virtue of owning such Transferred Interests (collectively, the “Sales” and each
individually a “Sale”).

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     (ii) Notwithstanding the foregoing, the Assigned Interest shall not
include: (x) any right to receive carried interest from a Partnership or any
obligation to return carried interest to a Partnership; (y) any obligation to a
Partnership, a General Partner or any other person or entity with respect to
(A) any Disgorgement Obligation (as defined below) or (B) any Clawback
Obligation (as defined below); and (z) Retained Section 1.6 Liability (defined
below), retained by a Seller and as set forth in the applicable Transfer
Agreement.
          For purposes of this Agreement:
          “Clawback Obligation” means any requirements a Seller (or its
predecessor in interest) has or may have to contribute (directly or indirectly)
to a General Partner (as defined below) or any other person or entity such
Seller’s share of any amount required to be contributed by such General Partner
to the applicable Partnership for purposes of the General Partner honoring its
obligations to the Partnership pursuant to Section 3.6 (c), (d) or (e) of the
applicable Partnership Agreement.
          “Disgorgement Obligation” means any liability to return (whether in
cash, by deduction from any capital account maintained by the Partnership in
respect of the Transferred Interest, by set off against one or more subsequent
distributions by the Partnership in respect of the Transferred Interest or
otherwise) all or any lesser portion of any distribution (or deemed
distribution) made by the Partnership to the applicable Seller (or any of its
predecessors in interest) in respect of all or any portion of the Transferred
Interest. For the avoidance of doubt, any Disgorgement Obligation arising out of
distributions made in respect of a Seller’s interests in Arbinet-thexchange,
Inc. (“Arbinet”) shall be considered an obligation of such Seller.
          “Retained Section 1.6 Liability” means any Section 1.6 Liability (as
defined below) (a) relating to or arising out of any transaction in connection
with which a Seller (or any of its predecessors in interest) received (or was
deemed to have received) proceeds from the Partnership or (b) otherwise
allocated to such Seller pursuant to the proviso contained in the definition of
Section 1.6 Liability. For the avoidance of doubt, any Section 1.6 Liability
arising out of distributions made in respect of a Seller’s interests in Arbinet
shall be considered a Retained Section 1.6 Liability of such Seller.
          “Section 1.6 Liability” means any liability pursuant to Section 1.6 or
1.6(a), as the case may be, of the applicable Partnership Agreement, as to the
Transferred Interest, to contribute capital to the Partnership to satisfy the
Partnership’s indemnification obligations; provided, however, that any
Section 1.6 Liability that is unable to be allocated as between a Seller and a
Buyer on the basis of the liability following the party that received the
proceeds of the underlying transaction, shall be allocated such that if the
underlying event that gives rise to the indemnification obligation has accrued
(a) prior to the Effective Date, then the applicable Seller shall be liable and
(b) on or after the Effective Date, then the applicable Buyer shall be liable.
     (iii) Notwithstanding anything herein to the contrary, neither Buyer is
hereby acquiring any interest in EnerTech Capital Partners II, L.P.’s interest
in Arbinet (the “Arbinet Interest”) and Bonfield Partners Capital, L.P.
(“Bonfield”) shall retain (a) the right to receive any and all earnings and/or
distributions on account of the Arbinet Interest and (b) the obligation to make
any payments relating to a Retained Section 1.6 Liability or a Disgorgement
Obligation in respect of the Arbinet Interest. HarbourVest VII Venture Ltd.
(“HarbourVest VII”) and Bonfield

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hereby agree to instruct EnerTech Management, L.P., the general partner of
EnerTech Capital Partners II, L.P., by joint letter of instruction, to make any
and all payments of earnings, proceeds, and/or distributions, of any kind or
nature and in any form, directly to Bonfield. If (a) any such payment or other
distribution (whether in cash or other property) is made to any Buyer in
violation of this Section 2(a)(iii) or (b) any funds, securities, or other
property is received by any Buyer upon any disposition or other action with
respect to any interest of Seller in Arbinet as described herein, in violation
of this Section, then such Buyer shall receive the same in trust for such
Seller’s benefit and shall forthwith remit same to Seller, in the form in which
it was received, together with such endorsements or documents as may be
necessary to effectively negotiate or transfer the same.
     (b) The purchase price (the “Purchase Price”) for a Transferred Interest
shall be the Purchase Price as of the Valuation Date, as certified by the
Sellers, less any distributions, capital account credits, or other payments
(determined prior to the deduction of any withholding or other taxes with
respect thereto and as valued at the distribution date by the applicable general
partner or managing member of the Partnership (each, a “General Partner” and
collectively, the “General Partners”) it being agreed that the value of all “in
kind” payments, dividends or other distributions shall be the value assigned
thereto as of the date of distribution by the applicable Partnership or General
Partner) made with respect to the Transferred Interest being transferred and
increased by any capital contributions made with respect to the Transferred
Interest being transferred, in each case after March 31, 2005 (the “Valuation
Date”) and in each case evidence reasonably satisfactory to the Buyer of such
distribution, capital account credit, other payment or capital contribution
shall be delivered by the applicable Seller to the applicable Buyer on or prior
to the Closing Date. The aggregate Purchase Price for the Transferred Interests
(without giving effect to any adjustments for distributions or capital
contributions) is $18,792,966.00 plus the assumption by the applicable Buyers of
the applicable Sellers’ obligation to pay any unfunded capital commitments with
respect to the Transferred Interests as certified by the Sellers, as adjusted
for any capital contributions made after the Valuation Date.
     (c) If a Purchase Price is adjusted, such adjustment shall be evidenced by
a certificate in the form of Exhibit B hereto (a “Price Adjustment Certificate”)
duly executed by the applicable Seller at the Closing (as defined below) of the
purchase and sale of the applicable Transferred Interest and the term “Purchase
Price” as used herein shall be construed in such case as a reference to the
adjusted Purchase Price as stated in such Price Adjustment Certificate for the
applicable Transferred Interest. If no adjustment to the Purchase Price is
necessary, such Seller shall execute a Price Adjustment Certificate at the
Closing stating the unadjusted Purchase Price of the applicable Transferred
Interest.
     (d) In furtherance of each Sale and effective the Closing Date for each
Sale, each Seller hereby assigns, delegates and transfers to the applicable
Buyer all of its right, title and interest in (i) with respect to the LP
Interests each of the agreements, instruments and other documents that are set
forth in Exhibit C-1 hereto beneath the name of the relevant Partnership (the
“LP Constituent Documents”) with respect to the LP Interest being assigned at
such Closing; and (ii) with respect to the Economic Interests, Assigned
Interests in each of the agreements, instruments and other documents that are
set forth in Exhibits C-2 and C-3 hereto beneath the name of the relevant
Partnership (the “Assigned Interest Constituent Documents” and together with the
LP Constituent Documents, the “Constituent Documents”) with respect to the
Economic Interests being assigned at such Closing.

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     3. Obligations Pending Closing.
     (a) Each Seller undertakes to forward to the applicable Buyer copies of all
notices, documents, or written communications relating to the Transferred
Interests received at any time after the date hereof (and whether before or
after the Closing Date) by such Seller or any other person on behalf of such
Seller.
     (b) Each Seller agrees that from the date hereof, neither it, nor any
person at its direction, will agree or consent to any change to any of the
Constituent Documents of any of the Partnerships to which it is a party,
including the Partnership Agreements or to any proposal which will or may
adversely affect or prejudice such Seller’s Transferred Interests other than (in
any such case) with the prior written approval of the Buyer purchasing such
Transferred Interests.
     (c) Each Seller shall use its commercially reasonable efforts to comply
with the requirements of the applicable transfer provisions of the Partnerships’
respective Constituent Documents, including providing the Partnerships or the
General Partners thereof with such information as may be reasonably required
under the terms of the Constituent Documents of the relevant Partnership.
     4. Closing.
     (a) The closing of the sale and purchase of a Transferred Interest (a
“Closing”) shall take place at such place, date and time as agreed to by each
Seller and each Buyer of such Transferred Interest promptly after all of the
closing conditions set forth in Section 7 with respect to such Transferred
Interest shall have been fulfilled (the “Closing Date”).
     (b) On each Closing Date, the applicable Seller will deliver to the
applicable Buyer (i) such assignments and other documents (including all
approvals required by the applicable Partnership to be delivered as a condition
to such transfer and a transfer agreement with respect to each Transferred
Interest in such form as is mutually agreeable to the applicable Seller and the
applicable Buyer (each, a “Transfer Agreement” and collectively, the “Transfer
Agreements”), duly executed by the applicable Seller and the applicable General
Partner), as may be necessary to convey and vest in the applicable Buyer all
right, title and interest in and to the Transferred Interests free and clear of
all liens, claims and encumbrances other than obligations imposed upon the
applicable Buyer under its constituent documents, restrictions on subsequent
transfers contained in the applicable Partnership Agreement and restrictions
imposed by Federal and state securities laws, and (ii) a Price Adjustment
Certificate for the applicable Transferred Interests duly executed by such
Seller.
     (c) On each Closing Date, the applicable Buyer shall (i) duly execute
Transfer Agreements for the applicable Transferred Interests and (ii) pay the
Purchase Price applicable to such Transferred Interests, net of any amounts
required to be withheld therefrom under applicable law, to an account designated
in writing by the applicable Seller.
     (d) From and after each Closing Date, the applicable Seller hereby agrees
to promptly forward to the applicable Buyer any correspondence, notices or
distributions (in cash or otherwise) received by the applicable Seller with
respect to such Transferred Interests as have been transferred pursuant to this
Agreement.

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     5. Representations and Warranties of each Seller. Each Seller, severally
and not jointly, hereby represents and warrants to the applicable Buyer, as of
the date hereof and as of the Closing Date, that:
     (a) Such Seller is duly organized and validly existing or subsisting, as
the case may be, in its jurisdiction of incorporation, the execution and
delivery of this Agreement and the consummation of the transactions contemplated
hereby have been duly and validly authorized by all necessary action on the part
of such Seller, and this Agreement has been duly executed and delivered by such
Seller and constitutes a legal, valid and binding obligation of such Seller
enforceable against such Seller in accordance with its terms.
     (b) Such Seller has full organizational power and authority to enter into
this Agreement and to assign each of its Transferred Interests to the applicable
Buyer. The execution and delivery of this Agreement by such Seller and the
consummation of the transactions contemplated by this Agreement by such Seller
do not conflict with, violate any of the terms and provisions of, or constitute
a default (or any event which, with notice or lapse of time or both, would
constitute a default) under, the governing agreements of such Seller or any law,
statute, regulation, decree, judgment, license, order, agreement or other
restriction applicable to such Seller.
     (c) Subject to any transfer restrictions contained in the applicable
Partnership Agreements and any transfer restrictions imposed by the Federal and
state securities laws, such Seller owns all right, title and interest in and to
each of the Transferred Interests, free and clear of all claims, liens, pledges,
charges, security interests, encumbrances, or rights of any nature of any third
party (each, an “Encumbrance”) and upon payment of the Purchase Price with
respect to a Transferred Interest by a Buyer as provided in this Agreement, such
Buyer will acquire marketable title to such Transferred Interest, free and clear
of any such Encumbrance, but subject to any obligations imposed on the
applicable Buyer by its constituent documents and any restrictions on subsequent
transfers imposed pursuant to the Partnership Agreements or Federal and state
securities laws.
     (d) Each LP Interest held by an LP Interest Seller comprises the total
interest of such Seller in the applicable LP Interest Partnership. Each Economic
Interest held by an Assigned Interest Seller comprises the total interest of
such Seller in the applicable Assigned Interest Partnership as set forth on
Exhibit A-2. The total capital commitment to each of the Partnerships in respect
of each Transferred Interest is the amount set forth on Exhibits A-1 and A-2,
respectively, hereto under the heading “Commitment with Respect to the
Transferred Interest.” Except as reflected in the applicable Price Adjustment
Certificate, (i) each Seller has paid in full to each applicable Partnership
when due with respect to the applicable Transferred Interest the amount of such
capital certified by the Sellers, (ii) each Seller has an outstanding unfunded
commitment to each applicable Partnership with respect to the applicable
Transferred Interest in the amount of such capital certified by the Sellers, and
(iii) the net asset value of each Transferred Interest as of the applicable
Valuation Date as reported by the applicable General Partner is the amount
certified by the Sellers. Such Seller is not in default under or in breach in
any material respect of any of the Constituent Documents of any of the
Partnerships to which it is a party and has not acted or omitted to act in such
a way that, with notice or lapse of time or both, it would be in default or in
breach of any Constituent Document to which it is a party. Such LP Interest
Seller has not opted out of

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or otherwise been excused from any portfolio investment made by any of the LP
Interest Partnerships and has participated in its pro rata share of each
portfolio investment made by the respective LP Interest Partnerships.
     (e) None of the Partnerships has made any distributions to any Seller since
the applicable Valuation Date, except as may be reflected in the Price
Adjustment Certificate duly executed by such Seller at the Closing.
     (f) No LP Interest Seller has taken any action with respect to any of the
LP Interest Partnerships or the LP Interests other than as a limited partner or
member of the respective LP Interest Partnerships in accordance with the
respective Partnership Agreements and has not waived any of its rights under the
Constituent Documents to which it is a party that has or would reasonably be
expected to adversely affect its LP Interests. From and after the date of the
applicable Assignment and Assumption Agreement, no Assigned Interest Seller has
taken any action with respect to any of the Assigned Interest Partnerships or
the Assigned Interests that has or would reasonably be expected to adversely
affect the value of its Assigned Interests.
     (g) In reliance on the representations and warranties made by the Buyers in
Section 6 hereof, no consent, license, approval, order or authorization of, or
registration, declaration or filing with any governmental authority, agency,
bureau, commission (each, a “Governmental Authority”) or other person is
required to be obtained (other than any consents required under the applicable
Partnership Agreement) by any Seller in connection with the sale, assignment and
transfer of any of the Transferred Interests.
     (h) No proceedings are pending or, to the knowledge of the Seller,
threatened against or affecting such Seller before any Governmental Authority,
court, tribunal or similar entity which, in the aggregate, would reasonably be
expected to adversely affect any action taken or to be taken by such Seller
under this Agreement or any of the applicable Transfer Agreements to be executed
on the relevant Closing Date.
     (i) Except for SSG Capital Advisors, L.P., the commissions and expenses of
which shall be borne by the Sellers, the Sellers have not employed any finder,
broker, agent or other intermediary in connection with the negotiation or
consummation of this Agreement or any of the transactions contemplated hereby in
such a manner as to give rise to a valid claim against the Buyers for any
commission. Such Seller will indemnify, severally and not jointly, the Buyers
and hold them harmless against and from any and all liabilities, expenses,
costs, losses and claims arising from any employment by the Sellers of, or
services rendered to the Sellers by, any finder, broker, agent or other
intermediary in such connection (or any allegation of any such employment or
services).
     (j) The Sellers have delivered, or caused to be delivered, to the Buyers
true and accurate copies of all the Constituent Documents. Other than the
agreements, instruments and other documents listed on Exhibits C-1, C-2 and C-3,
and this Agreement and the related transactional documents none of the Sellers
is a party to or bound by any contract, agreement, commitment or waiver with
respect to the Transferred Interests.

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     (k) Each Seller has evaluated the merits and risks of selling each of the
Transferred Interests on the terms set forth in this Agreement, and has such
knowledge and experience in financial and business matters that it is capable of
evaluating the merits and risks of such sale, is aware of and has considered the
financial risks and financial hazards of selling each of the Transferred
Interests on the terms set forth in this Agreement and is willing to forego
through such sales the potential for future economic gain that might be realized
from each of the Transferred Interests. Each Seller has had access to such
information regarding the business and finances of each of the Partnerships and
General Partners and such other matters with respect to each of the Partnerships
and General Partners as a reasonable person would consider in evaluating the
transactions contemplated hereby, including, in particular, all information
necessary to determine the fair market value of each of the Transferred
Interests.
     (l) Each Seller has been represented by, and had the assistance of, counsel
in the conduct of any due diligence, in the preparation and negotiation of this
Agreement, the Transfer Agreements and any related documentation and in
connection with the consummation of the transactions contemplated hereby. No
representation or warranty by a Seller in this Agreement and no statement made
or contained in any certificate or instrument delivered, or to be delivered, to
the Buyer pursuant to this Agreement (including the Price Adjustment
Certificates and the Transfer Agreements) contains or will contain, as of the
date such statement is made or deemed made, any untrue statement of a material
fact or omits or will omit, as of the date such statement is made or deemed
made, to state a material fact necessary to make such representations,
warranties or statements not misleading as of the date made or deemed made.
     (m) Each LP Interest Seller either (i) acquired the LP Interest at original
issue directly from the relevant LP Interest Partnership or (ii) acquired the LP
Interest from a general partner or limited partner of the Partnership prior to
October 22, 2004. Each Seller’s tax basis for U.S. federal income tax purposes,
as of the last day of the Partnership’s fiscal year prior to the fiscal year
including the date hereof, with respect to the Transferred Interest was the
amount certified by the Seller. Each Seller shall furnish or cause to be
furnished to the Buyer, promptly after receipt, its Schedule K-1 to IRS
Form 1065 for each Partnership for the fiscal year including the date hereof. In
furtherance thereof, each Seller hereby authorizes the General Partner to
furnish directly to the Buyer copies of such Seller’s Schedule K-1s for such
fiscal year. For purposes of this paragraph, if the Partnership furnishes to a
Seller a statement in lieu of a Schedule K-1, “Schedule K-1” shall mean such
statement.
     (n) With respect to each Economic Interest (or predecessor interest of each
Economic Interest), either (i) the respective Assigned Interest Partnership will
not be an “electing investment partnership” within the meaning of
Section 743(e)(6) of the Internal Revenue Code of 1986, as amended, (ii) no loss
has been recognized by any transferor with respect to any transfer of such
Economic Interest (or predecessor interest), or (iii) to the extent any loss was
so recognized, such loss relates to a transfer which took place prior to
October 22, 2004.
     6. Representations and Warranties of each Buyer. Each Buyer, severally and
not jointly, hereby represents and warrants to the applicable Seller, as of the
date hereof and as of the Closing Date, that:

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     (a) Such Buyer is duly organized and validly existing in its jurisdiction
of organization, the execution and delivery of this Agreement and the
consummation of the transactions contemplated hereby have been duly and validly
authorized by all necessary action on the part of such Buyer, and this Agreement
has been duly executed and delivered by such Buyer and constitutes a legal,
valid and binding obligation of such Buyer enforceable against such Buyer in
accordance with its terms.
     (b) Such Buyer has full corporate or limited partnership power and
authority, as the case may be, to enter into this Agreement and to purchase the
Transferred Interests from the respective Sellers. The execution and delivery of
this Agreement by such Buyer and the consummation of the transactions
contemplated by this Agreement by such Buyer do not conflict with, violate any
of the terms and provisions of, or constitute a default (or any event which,
with notice or lapse of time or both, would constitute a default) under, the
governing agreements of such Buyer or any law, statute, regulation, decree,
judgment, license, order, agreement or other restriction applicable to such
Buyer.
     (c) No consent, license, approval, order or authorization of, or
registration, declaration or filing with any Governmental Authority or other
person is required to be obtained (other than any consents required under the
applicable Partnership Agreement to be obtained by a Seller or the applicable
General Partner) by such Buyer in connection with the purchase, assumption and
transfer of any of the Transferred Interests.
     (d) No proceedings are pending or, to the knowledge of the such Buyer,
threatened against or affecting such Buyer before any Governmental Authority,
court, tribunal or similar entity which, in the aggregate, would reasonably be
expected to adversely affect any action taken or to be taken by such Buyer under
this Agreement or any of the applicable Transfer Agreements to be executed on
the relevant Closing Date.
     (e) Such Buyer is acquiring the Transferred Interests being purchased by it
for its own account for investment, and not with a view to, or for resale in
connection with, any distribution thereof. Such Buyer agrees not to sell,
hypothecate or otherwise dispose of any of the Transferred Interests, purchased
by it, except in accordance with the terms of the respective Constituent
Documents and unless such transfer has been registered under the Securities Act
of 1933, as amended (the “Act”), or an exemption from the registration
requirements of the Act is available.
     (f) Such Buyer is an “accredited investor” as defined in Rule 501(a) of
Regulation D promulgated under the Act.
     (g) Such Buyer is a “qualified purchaser” (as defined in the Investment
Company Act of 1940, as amended).
     (h) Such Buyer has not employed any finder, broker, agent or other
intermediary in connection with the negotiation or consummation of this
Agreement or any of the transactions contemplated hereby in such a manner as to
give rise to a valid claim against any Seller for any commission. Such Buyer
will indemnify, severally and not jointly, the Sellers and hold them harmless
against and from any and all liabilities, expenses, costs, losses and claims
arising from any employment by such Buyer of, or services rendered to such Buyer

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by, any finder, broker, agent or other intermediary in such connection (or any
allegation of any such employment or services).
     (i) Such Buyer has evaluated the merits and risks of purchasing the
Transferred Interests being purchased by it on the terms set forth in this
Agreement, and has such knowledge and experience in financial and business
matters that it is capable of evaluating the merits and risks of such purchase,
is aware of and has considered the financial risks and financial hazards of
purchasing the Transferred Interests being purchased by it on the terms set
forth in this Agreement and is able to bear the economic risks of purchasing the
Transferred Interests being purchased by it, including the possibility of
complete loss with respect thereto. Such Buyer has had access to such
information regarding the business and finances of each of the applicable
Partnerships and such other matters with respect to each of the applicable
Partnerships as a reasonable person would consider in evaluating the
transactions contemplated hereby, including, in particular, all information
necessary to determine the fair market value of each of the Transferred
Interests.
     (j) Such Buyer has been represented by, and had the assistance of, counsel
in the conduct of any due diligence, in the preparation and negotiation of this
Agreement, the Transfer Agreements and any related documentation and in
connection with the consummation of the transactions contemplated hereby. No
representation or warranty by a Buyer in this Agreement and no statement made or
contained in any certificate or instrument delivered, or to be delivered, to a
Seller pursuant to this Agreement contains or will contain, as of the date such
statement is made or deemed made, any untrue statement of a material fact or
omits or will omit, as of the date such statement is made or deemed made, to
state a material fact necessary to make such representations, warranties or
statements not misleading as of the date made or deemed made.
     7. Closing Conditions.
     (a) The obligation of each Seller and the respective Buyers to sell and
purchase a Transferred Interest is subject to the consent required under the
applicable Constituent Documents and to the compliance with or waiver of any and
all transfer restrictions applicable to such Transferred Interests, including
rights of first refusal, rights of pre-emption, or similar rights contained in
the applicable Partnership Agreements or any other Constituent Document. Such
consent, compliance or waiver shall be evidenced by due execution of each of the
Transfer Agreements on the Closing Date by the applicable General Partner and
the Seller. Each Seller shall use its commercially reasonable efforts to obtain
the consent of, and certification as to compliance or waiver from, the
applicable General Partner.
     (b) The obligation of a Seller to sell a Transferred Interest is subject
to: (i) such Seller’s receipt of the applicable Purchase Price for such
Transferred Interest; (ii) the receipt by the other Sellers of the applicable
Purchase Price for each other Transferred Interest subject to this Agreement;
and (iii) receipt by the Sellers of all documents, certificates and information
required to be provided by the Buyers that are necessary to (A) consummate the
transactions contemplated hereby and (B) obtain the consent, certification or
waivers from the applicable General Partners.

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     8. Indemnification.
     (a) Each Seller, severally and not jointly, shall, and hereby does,
indemnify, defend and hold each respective Buyer and its successors and assigns
harmless from and against any loss, liability, cost or expense (including any
tax, fee and other governmental charge) (collectively, “Loss”) imposed upon or
incurred by such Buyer or any such person resulting from or arising out of (i)
such Seller’s ownership of the Transferred Interests prior to the applicable
Closing Date, including the return (whether such return shall be effected by
repayment or by deduction from or set-off against any subsequent distribution to
the Buyer’s capital account or otherwise) by such Buyer of all or any part of
any direct or indirect distribution made by any of the Partnerships to the
Seller (or its predecessor in interest), (ii) any Retained Section 1.6
Liability, (iii) any breach by such Seller of any of its obligations,
representations or warranties set forth in this Agreement, the Constituent
Documents, the applicable Transfer Agreements or any other document delivered in
connection therewith or herewith or (iv) any tax, fee or other governmental
charge attributable to the ownership or sale by such Seller of the Transferred
Interests (including any deductions from any distributions made by a Partnership
to such Buyer, or any payment by a Partnership otherwise chargeable to the such
Buyer relating to withholding tax deductions or other payments of taxes
attributable to the ownership by such Seller of any of the Partnership
Interests); provided, however, that no indemnification is provided in this
Section 8(a) with respect to (x) any Loss imposed upon or incurred by the Buyers
of interests in the TL III Funds (whether directly or indirectly) resulting from
or arising out of the Traffic.com Litigation, and (y) any claim for which
indemnity is provided under Section 8(c) hereof. In no event shall this
indemnity be construed to include any obligation of a Seller to indemnify a
Buyer for any indirect, incidental, special or consequential damages.
     (b) Each of Safeguard Scientifics (Delaware), Inc., Safeguard Fund
Management L.P., and SFINT, Inc., jointly and severally, shall, and hereby does,
indemnify, defend and hold each of the Buyers and its respective successors and
assigns harmless from and against such Buyer’s pro rata share of any Direct Loss
incurred by TL Ventures III L.P., TL Ventures III Offshore, L.P. and TL Ventures
III Interfund, L.P. (the “TL III Funds”) in connection with the Traffic.com
Litigation. For purposes of this Section 8(b), (i) “Direct Loss” shall mean any
direct out-of-pocket payment made by the respective TL III Funds in connection
with the Traffic.com Litigation, whether for indemnity, contribution, or
satisfaction or any judgment, award or settlement of such litigation, including
expenses relating thereto that is not reimbursed or reimbursable by insurance or
otherwise; and (ii) “Traffic.com Litigation” shall refer to that certain law
suit captioned “Santa Fe Technologies, Inc. v. Mark Nash, Jerry Musnitsky,
Harvey G. Dollar, Argus Networks, Inc., TL Ventures LLC, Mark J. DeNino, Michael
D. Burns and David J. Jannetta,” originally pending before the State of New
Mexico, Second Judicial District Court in the County of Bernalillo, New Mexico,
Case No. CV 99-07715 and any appeals therefrom and related suits among one or
more of the same parties arising from the same precipitating facts. Each Buyer’s
pro rata share of any such Direct Loss shall be equal to its proportionate
percentage interest in the applicable TL III Funds, as more specifically set
forth on Exhibits A-1 and A-2 hereof.
     (c) With respect to the Economic Interests acquired by Buyers hereunder, in
the event any Partnership or any General Partner of any Partnership is precluded
from making any distribution to the applicable Buyer on the same basis on which
it makes any such distribution to limited partners of such Partnership (with
such Transferee being deemed to have an original

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capital commitment to the Partnership in an amount equal to the Capital
Commitment with respect to such Economic Interest), all Sellers of Economic
Interests, jointly and severally, shall, and hereby do, agree to indemnify and
pay over to the applicable Buyer the amount of any such distribution to which
such Buyer would have been entitled had it held a limited partnership interest
in the applicable Partnership (the amount of such distribution being the “LP
Equivalent Amount”); provided, however, that Sellers shall, upon satisfying the
obligations provided in this Section 8(c), be subrogated to the rights of such
Buyer with respect to any subsequent recovery by such Buyer of any such amounts
paid by Sellers, whether as a result of a return by the General Partner and
subsequent distribution to limited partners of amounts required to be paid by
the general partner disgorgement provisions of the applicable Partnership
Agreement, or otherwise, and each Buyer hereby agrees to pay over to Sellers the
amount of any such subsequent proceeds received, to the extent that receipt of
such proceeds by such Buyer would result in its having received more than the
aggregate amount to which such Buyer would have been entitled had it held a
limited partnership interest in the applicable Partnership from and after the
Closing Date (after giving effect to the provisions of Section
2(a)(iii) hereof), provided in no event shall such Buyer be required to pay over
an amount exceeding the LP Equivalent Amount. In no event shall the indemnity
provided in this Section 8(c) be construed to include any obligation of a Seller
to indemnify a Buyer for any indirect, incidental, special or consequential
damages.
     (d) Each Buyer, severally and not jointly, shall, and hereby does,
indemnify, defend and hold the respective Seller and its successor and assigns
harmless from and against any Loss imposed upon or incurred by such Seller with
respect to the Transferred Interest, which results from or arises out of (i)
such Buyer’s ownership of the Transferred Interests after the applicable Closing
Date (including for any Section 1.6 Liability other than the Retained
Section 1.6 Liability), other than to the extent any Seller is responsible
therefor under Section 8(a), (b) or (c) hereof, and (ii) a breach by such Buyer
of any of its obligations, representations or warranties set forth in this
Agreement, the Transfer Agreements to which it is a party or any other document
delivered by such Buyer in connection herewith. In no event shall this indemnity
be construed to include any obligation of a Buyer to indemnify a Seller for any
indirect, special or consequential damages
     9. Termination.
     (a) This Agreement may be terminated by the mutual consent of the Sellers
and the Buyers.
     (b) This Agreement may be terminated by either a Seller or a Buyer in whole
and not in part if (i) the applicable General Partner has not consented to the
transfer of any such Transferred Interest; (ii) with respect to the LP
Interests, the applicable General Partner has not agreed to admit the Buyer to
each applicable LP Interest Partnership as a limited partner in good standing;
or (iii) any transfer restrictions (including rights of first refusal, rights of
preemption and similar rights) relating to such Transferred Interest have not
been waived or complied with, in any case, by 5:00 p.m. Eastern Standard Time on
December 31, 2005.
     10. Miscellaneous
     (a) Each party hereto shall bear its own expenses incurred in connection
with this Agreement and the transactions contemplated hereby. Notwithstanding
the terms of any of the

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Constituent Documents, the Seller will pay all transfer fees and other costs or
expenses incurred by the General Partners or the Partnerships in connection with
the transactions contemplated hereby.
     (b) This Agreement shall be governed in all respects, including validity,
construction, interpretation and effect, by the laws of the State of Delaware,
without giving effect to its principles or rules of conflict of laws to the
extent such principles or rules would require or permit the application of the
laws of another jurisdiction. The parties agree that the State of Delaware has a
substantial relationship to this transaction.
     (c) All notices and other communications shall be in writing and shall be
delivered or mailed, (i) if to the Buyer, to HarbourVest Partners, One Financial
Center, Boston, Massachusetts 02111, Attn: Fred Maynard and (ii) if to the
Sellers, c/o Safeguard Scientifics, Inc., 800 The Safeguard Building, 435 Devon
Park Drive, Wayne, Pennsylvania 19087, Attn: Christopher Davis.
     (d) This Agreement may be executed simultaneously in two or more identical
counterparts, each of which shall be deemed an original, and all of which shall
constitute one and the same instrument.
     (e) This Agreement, the Transfer Agreements and the Price Adjustment
Certificate shall constitute the entire agreement and supersedes all prior
agreements and understandings, both written and oral, among the parties with
respect to the subject matter hereof.
     (f) The terms and conditions of this Agreement shall inure to the benefit
of and be binding upon the successors and assigns of the parties hereto. This
Agreement may not be assigned by any party without the prior written consent of
the other party hereto (which consent shall not be unreasonably withheld,
delayed or conditioned).
     (g) Each party hereto agrees to execute and deliver to the other party such
further instruments and to take such further actions as the other party may
reasonably deem necessary to fully effectuate the intent and purposes of this
Agreement.
     (h) All representations and warranties contained in this Agreement shall
survive the Closing and shall not merge into any instrument of assignment or
conveyance delivered by the Seller. All statements contained in any certificate
or other instrument executed and delivered by or on behalf of the Seller
pursuant to this Agreement or in connection with the transaction contemplated by
this Agreement shall be considered representations and warranties by the Seller
to the Buyer with the same force and effect as if contained in this Agreement.
     (i) Any term or provision of this Agreement that is invalid or
unenforceable in any jurisdiction shall, as to that jurisdiction, be ineffective
to the extent of such invalidity or unenforceability without rendering invalid
or unenforceable the remaining terms and provisions of this Agreement or
affecting the validity or enforceability of any of the terms or provisions of
this Agreement in any other jurisdiction. If any provision of this Agreement is
so broad as to be unenforceable, the provision shall be interpreted to be only
so broad as is enforceable.

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     IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
duly executed as of the date first above written.

                          BUYERS:    
 
                        HARBOURVEST VII VENTURE LTD.    
 
                        By:   /s/ John M. Begg                           Name:
John M. Begg             Title: Vice President    
 
                        HARBOURVEST PARTNERS VII-VENTURE         PARTNERSHIP
FUND L.P.         By:   HarbourVest VII-Venture Partnership Associates LLC      
  Its General Partner         By:   HarbourVest Partners, LLC             Its
Managing Member    
 
                        By:   /s/ John M. Begg                           Name:
John M. Begg             Title: Managing Director    
 
                        DOVER STREET VI L.P.         By:   Dover VI Associates
L.P., its general         partner        
 
                            By:   Dover VI Associates LLC, its general          
  partner        
 
                   
 
          By:   HarbourVest Partners, LLC, its                 managing member  
 
 
                        By:   /s/ John M. Begg                           Name:
John M. Begg             Title: Managing Director    

 

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                  SELLERS:    
 
                SAFEGUARD SCIENTIFICS (DELAWARE),
INC.    
 
           
 
  By:   /s/ Christopher J. Davis    
 
           
 
      Name: Christopher J. Davis    
 
      Title: Vice President and Treasurer    
 
                BONFIELD FUND MANAGEMENT L.P.    
 
           
 
  By:   Bonfield VII, Ltd., its general partner    
 
           
 
  By:   /s/ Christopher J. Davis    
 
           
 
      Name: Christopher J. Davis    
 
      Title: Vice President and Treasurer    
 
                BONFIELD VII, LTD.    
 
           
 
  By:   /s/ Christopher J. Davis    
 
           
 
      Name: Christopher J. Davis    
 
      Title: Vice President and Treasurer    
 
                BONFIELD PARTNERS CAPITAL L.P.    
 
           
 
  By:   Bonfield VII, Ltd., its general partner    
 
           
 
  By:   /s/ Christopher J. Davis    
 
           
 
      Name: Christopher J. Davis    
 
      Title: Vice President and Treasurer    
 
                SAFEGUARD FUND MANAGEMENT L.P.    
 
           
 
  By:   Safeguard Fund Management, Inc.,    
 
      its general partner    
 
           
 
  By:   /s/ Christopher J. Davis    
 
           
 
      Name: Christopher J. Davis    
 
      Title: Vice President and Treasurer    

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                      SFINT, INC.    
 
                    By:   /s/ Christopher J. Davis                          
Name: Christopher J. Davis             Title: Vice President and Treasurer    
 
                    TL VENTURES MANAGEMENT, L.P.    
 
                    By:   Safeguard Fund Management L.P.,             its
general partner    
 
               
 
      By:   Safeguard Fund Management, Inc.,             its general partner    
 
                    By:   /s/ Christopher J. Davis                          
Name: Christopher J. Davis             Title: Vice President and Treasurer    

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Exhibit A-1

                                      Commitment with                 Respect to
the   Percentage of Partnership   Seller   Buyer   Transferred Interest  
Partnership
Radnor Venture
Partners, LP1
  Safeguard Scientifics (Delaware), Inc.   HarbourVest VII Venture Ltd.   $
3,250,000       9.911626 %
 
      Dover Street VI L.P.   $ 1,250,000       3.812164 %
 
                       
Technology Leaders L.P.
  Bonfield VII, Ltd.   Dover Street VI L.P.   $ 2,000,000       7.065127 %
 
                       
Technology Leaders II, L.P.
  Bonfield VII, Ltd.   HarbourVest VII Venture Ltd.   $ 4,992,306       7.996042
%
 
                       
TL Ventures III LP
  SFINT, Inc.   HarbourVest VII Venture Ltd.   $ 250,000       0.108839 %
 
                       
TL Ventures III Interfund L.P.
  Safeguard Scientifics (Delaware), Inc.   HarbourVest VII Venture Ltd.   $
742,500       9.899868 %
 
      Dover Street VI L.P.   $ 617,500       8.233224 %
 
                       
EnerTech Capital Partners, L.P.
  Bonfield Partners Capital, L.P.   HarbourVest VII Venture Ltd.   $ 2,500,000  
    4.433169 %
 
                       
EnerTech Capital Partners II, L.P.
  Bonfield Fund Management, L.P.   Dover Street VI L.P.   $ 10,000,000      
4.411223 %

 

1   If the general partner of Radnor Venture Partners, LP (“RVP”) does not get
unanimous consent of the limited partners of RVP, the Buyers’ interests in RVP
will be that of a statutory assignee.

A-1

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Exhibit A-2

                                      Commitment with                 Respect to
the                 Transferred   Percentage of Partnership   Seller   Buyer  
Interest   Partnership
TL Ventures III L.P.
  Safeguard Scientifics (Delaware), Inc.   HarbourVest VII Venture Ltd.   $
1,516,000       0.660000 %
 
                       
TL Ventures III L.P.
  Safeguard Fund Management, L.P.   HarbourVest VII Venture Ltd.   $ 7,000,000  
    3.047493 %
 
                       
TL Ventures III L.P.
  Safeguard Scientifics (Delaware), Inc.   HarbourVest VII Venture Ltd.   $
15,321       0.006670 %
 
                       
TL Ventures III Offshore L.P.
  Safeguard Scientifics (Delaware), Inc.   Dover Street VI L.P.   $ 317,333    
  0.659999 %
 
                       
TL Ventures IV L.P.
  Safeguard Management Fund L.P.   HarbourVest VII Venture Ltd.   $ 499,450    
  0.198020 %
 
                       
TL Ventures IV L.P.
  Safeguard Management Fund L.P.   HarbourVest VII Venture Ltd.   $ 10,000,000  
    3.964757 %
 
                       
TL Ventures V L.P.
  TL Ventures Management L.P.   HarbourVest Partners VII-Venture Partnership
Fund L.P.   $ 25,000,000       3.710019 %
 
                       
EnerTech Capital Partners, L.P.2
  Bonfield Partners Capital, L.P.   HarbourVest VII Venture Ltd.   $ 547,505    
  0.970873 %
 
                       
EnerTech Capital Partners, L.P.3
  Bonfield Partners Capital, L.P.   HarbourVest VII Venture Ltd.   $ 862.07    
  0.001529 %
 
                       
EnerTech Capital Partners II, L.P.
  Bonfield Fund Management, L.P.   Dover Street VI L.P.   $ 317,220      
0.139933 %

 

2   Interest formerly held in EnerTech Management L.P.   3   Interest formerly
held in EnerTech Management Company L.P.

A-2

 

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The following exhibits have been omitted pursuant to Item 601(b)(2) of Reg. S-K:

     
Exhibit B-1
  Price Adjustment Certificate
Exhibit C-1
  LP Interest Documents
Exhibit C-2
  Assignment and Assumption Agreements
Exhibit C-3
  Assigned Interest Documents

The Company agrees to furnish supplementally a copy of any omitted exhibit to
the Commission upon request.