Exhibit 10.2

 

 

 

 

AGREEMENT AND PLAN OF MERGER AND REORGANIZATION 

 

among:

 

 

Global Eagle Acquisition Corp.,
a Delaware corporation;

 

 

EAGL Merger Sub Corp.,
a Delaware corporation;

 

 

Row 44, Inc.,
a Delaware corporation;

 

 

and

 

 

PAR Investment Partners, L.P.,
a Delaware limited partnership

 

 

___________________________

 

Dated as of November 8, 2012

___________________________

 

 

 

 

 

 

Table of Contents

 

Page

 

 

Section 1. Description of The Merger; Share Exchange 1       1.1 Merger of
Merger Sub into the Company 1 1.2 Effect of the Merger 1 1.3 Closing; Effective
Time 1 1.4 Certificate of Incorporation and Bylaws; Directors and Officers 2 1.5
Conversion of Shares 2 1.6 Closing of the Company’s Transfer Books 4 1.7
Exchange of Certificates 4 1.8 Appraisal Shares 5 1.9 Treatment of Company
Options and Company Warrants 6 1.10 Share Repurchase Right 7 1.11 Backstop Fee
Agreement 7 1.12 Tax Consequences 7 1.13 Further Action 7 1.14 Adjustments to
Net Merger Consideration and Merger Shares 7 1.15 Parent Committee 9      
Section 2. Representations and Warranties of the Company 9       2.1
Organization; Qualification 9 2.2 Power; Authorization 9 2.3 Non-Contravention
10 2.4 Capitalization 10 2.5 No Violation or Default; Compliance with Legal
Requirements 12 2.6 Brokers or Finders 13 2.7 Litigation 13 2.8 Title to
Property and Assets 13 2.9 Intellectual Property 14 2.10 Disclosure 15 2.11
Financial Statements; Accounting Controls 15 2.12 Changes 16 2.13 Taxes 18 2.14
Insurance 19 2.15 Employee Matters 19 2.16 Related-Party Transactions 23 2.17
Permits 24 2.18 Subsidiaries 24 2.19 Agreements; Actions 24 2.20 Environmental
and Safety Laws 26 2.21 Exclusive Rights 26 2.22 Real Property Holding Company
26 2.23 Records 26 2.24 Company Stockholder Approval 26

 

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Table of Contents

(continued)

Page

 

 

2.25 Real Property 27 2.26 Information Supplied 27 2.27 No Discussions 27 2.28
Accredited Investors 27       Section 3. Representations and Warranties of
Parent and Merger Sub 27       3.1 Organization; Qualification 27 3.2 Power;
Authorization 28 3.3 No Conflict; Consents 28 3.4 Valid Issuance 28 3.5
Capitalization 28 3.6 Merger Sub 29 3.7 SEC Filings; Financial Statements 29 3.8
Taxes 30 3.9 No Discussions 30 3.10 Parent Vote Required 30 3.11 Trust Account
31 3.12 Brokers or Finders 32       Section 4. Certain Covenants of the Company
and Par 32       4.1 Access and Investigation 32 4.2 Company Operations 32 4.3
Notification; Updates to Schedule of Exceptions 34 4.4 No Negotiations 34 4.5
Public Announcements 35 4.6 Trust Account Waiver 35 4.7 Notices and Consents 35
4.8 Company Stockholder Approval 35 4.9 Certain Company Covenants Related to
Proxy Statement and Additional Parent Filings 36 4.10 Company Penny Warrants 36
4.11 2011 Equity Incentive Plan 36       Section 5. Certain Covenants of Parent
36       5.1 Proxy Statement 36 5.2 Parent Operations 37 5.3 Public
Announcements 37 5.4 No Other Transactions 38 5.5 Indemnification Agreements 38
5.6 Post-Closing Covenants of Parent 38

 

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Table of Contents

(continued)

Page

 

 

Section 6. Covenants of Company and Parent 39       6.1 Cooperation 39 6.2 HSR
Act 39 6.3 Updates to Proxy Statement 39       Section 7. Conditions Precedent
to Obligations of Parent and Merger Sub 39       7.1 Accuracy of the Company’s
Representations 39 7.2 Performance of Covenants 40 7.3 Parent Stockholder
Approval 40 7.4 Required Consents 40 7.5 Agreements and Documents 40 7.6 Absence
of Material Adverse Effect 41 7.7 Backstop Agreement 41 7.8 AIA Transactions 41
7.9 HSR Act 41 7.10 No Restraints 41 7.11 No Legal Proceedings; Bankruptcy 41
7.12 Appraisal Rights 42 7.13 Company Stockholder Approval 42       Section 8.
Conditions Precedent to Obligations of the Company 42       8.1 Accuracy of
Representations 42 8.2 Performance of Covenants 42 8.3 Share Redemptions 42 8.4
Parent Stockholder Approval 42 8.5 Agreements and Documents 42 8.6 AIA
Transactions 43 8.7 HSR Act 43 8.8 No Restraints 43 8.9 No Legal Proceedings;
Bankruptcy 43 8.10 Trust Account 43 8.11 Company Stockholder Approval 43 8.12
Restated Parent Organizational Documents 43       Section 9. Termination 44    
  9.1 Termination Events 44 9.2 Termination Procedures 45 9.3 Fees Payable by
the Company 45

 

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Table of Contents

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Page

 

 

9.4 Fees Payable by Parent 45 9.5 Effect of Termination 45       Section 10.
Indemnification, Etc 45       10.1 Survival of Representations, Etc 45 10.2
Indemnification 46 10.3 Exclusivity of Indemnification Remedies 48 10.4 No
Contribution 48 10.5 Defense of Third Party Claims 48 10.6 Claims Relating to
Securities 49 10.7 Security Interest in Escrow 49 10.8 Release of Escrow Shares
to Satisfy Indemnification Claims 50 10.9 Materiality 50 10.10 Effect of
Investigation 50       Section 11. Miscellaneous Provisions 51       11.1
Stockholders’ Agent 51 11.2 Further Assurances 51 11.3 Fees and Expenses 52 11.4
Attorneys’ Fees 52 11.5 Notices 52 11.6 Time of the Essence 53 11.7 Headings 53
11.8 Counterparts 53 11.9 Governing Law; Venue 53 11.10 Successors and Assigns;
Assignment 54 11.11 Remedies Cumulative; Specific Performance 54 11.12 Waiver 54
11.13 Amendments 54 11.14 Severability 54 11.15 Parties in Interest 55 11.16
Entire Agreement 55 11.17 Schedules of Exceptions 55 11.18 Waiver of Jury Trial
55 11.19 Release 55 11.20 Construction 56

 

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Table of Contents

(continued)

Page

 

 

EXHIBITS           Exhibit A - Certain Definitions Exhibit B - Form of
Certificate of Merger Exhibit C - Form of Post-Closing Restated Certificate of
Incorporation of Surviving Corporation Exhibit D - Post-Closing Directors of
Parent Exhibit E - Post-Closing Directors of Surviving Corporation Exhibit F -
Form of Escrow Agreement Exhibit G - Form of Registration Rights Agreement
Exhibit H - Form of Post-Closing Restated Certificate of Incorporation of Parent
Exhibit I - Form of Post-Closing Restated Bylaws of Parent

 

LIST OF SCHEDULE OF EXCEPTIONS     Section 2.1 Organization; Qualification
Section 2.3 Non-Contravention Section 2.4(c) Exercise Price Adjustments Section
2.4(e) Capitalization Section 2.4(f) Table of Company Stockholders Section
2.4(g) Table of Company Optionholders Section 2.4(h) Preemptive Rights Section
2.5 No Violation or Default Section 2.6 Brokers or Finders Section 2.7
Litigation Section 2.8 Title to Property and Assets Section 2.9(a) Intellectual
Property Section 2.9(b) Intellectual Property Exceptions Section 2.11 Financial
Statements; Accounting Controls Section 2.12 Changes Section 2.13 Taxes Section
2.14 Insurance Section 2.15(a) Company Plans Section 2.15(b) Certain Company
Plans Section 2.15(i) Employees, Consultants and Independent Contractors Section
2.15(l) Certain Employment Arrangements Section 2.15(m) Representations
Regarding Equity Incentives Section 2.15(o) Certain Confidentiality Matters
Section 2.15(p) Employee Release Matters Section 2.15(s) Labor Disputes Section
2.18 Subsidiaries Section 2.19 Material Contracts Section 2.19(g) Company
Exclusivity Rights

 

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Table of Contents

(continued)

Page

 

 

Section 2.20 Environmental and Safety Laws Section 2.25(a) Leased Real Property
Section 2.25(b) Lease Defaults Section 7.5 Required Consents Section A Material
Terms of Performance Warrant     LIST OF PARENT SCHEDULE OF EXCEPTIONS    
Section 3.1 Organization; Qualification Section 3.8 Taxes Section 3.12 Brokers
or Finders    

 

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AGREEMENT AND PLAN
OF MERGER AND REORGANIZATION

 

This Agreement and Plan of Merger and Reorganization is made and entered into as
of November 8, 2012 (the “Execution Date”), by and among Global Eagle
Acquisition Corp., a Delaware corporation (“Parent”), EAGL Merger Sub Corp., a
Delaware corporation and a direct wholly owned subsidiary of Parent (“Merger
Sub”), Row 44, Inc., a Delaware corporation (the “Company”), and PAR Investment
Partners, L.P., a Delaware limited partnership (“PAR”), in its capacity as
Stockholders’ Agent and for certain specific purposes set forth on the signature
page hereto.

 

Recitals

 

A. Parent, Merger Sub and the Company intend to effect a merger of Merger Sub
into the Company in accordance with this Agreement and the General Corporation
Law of the State of Delaware (the “DGCL”). Upon consummation of the Merger,
Merger Sub will cease to exist, and the Company will become a wholly owned
subsidiary of Parent.

 

B. It is intended that the Merger qualify as a tax-free reorganization within
the meaning of Section 368(a) of the Code.

 

C. This Agreement has been approved by the respective boards of directors of
Parent, Merger Sub and the Company.

 

D. The definitions of all capitalized terms not otherwise defined in the text of
this Agreement are set forth on Exhibit A hereto.

 

Agreement

 

NOW, THEREFORE, in consideration of the above stated premises, and such other
consideration the receipt and sufficiency of which is hereby acknowledged, the
parties to this Agreement agree as follows:

 

Section 1.Description of The Merger; Share Exchange.

 

1.1              Merger of Merger Sub into the Company. Upon the terms and
subject to the conditions set forth in this Agreement, at the Effective Time,
Merger Sub shall be merged with and into the Company (the “Merger”), and the
separate existence of Merger Sub shall cease. The Company will continue as the
surviving corporation in the Merger (the “Surviving Corporation”).

 

1.2              Effect of the Merger. The Merger shall have the effects set
forth in this Agreement and in the applicable provisions of the DGCL.

 

1.3              Closing; Effective Time. The consummation of the transactions
contemplated by this Agreement (the “Closing”) shall take place at the offices
of McDermott Will & Emery, LLP, 340 Madison Avenue, New York, New York 10173, on
a date and at a time to be mutually agreed to by Parent and the Company as soon
as practicable, but no later than one (1) business day, after the satisfaction
or waiver of the conditions set forth in Sections 7 and 8. The date on which the
Closing actually takes place is referred to in this Agreement as the “Closing
Date.” Contemporaneously with the Closing, a properly executed certificate of
merger conforming to the requirements of the DGCL in the form attached as
Exhibit B hereto (the “Certificate of Merger”) shall be filed with the Secretary
of State of the State of Delaware.

 

 

 

 

1.4              Certificate of Incorporation and Bylaws; Directors and
Officers. Unless otherwise determined by Parent and the Company prior to the
Effective Time:

 

(a)               the Restated Certificate shall be amended and restated as of
the Effective Time in the form set forth on Exhibit C hereto;

 

(b)               the bylaws of the Surviving Corporation shall be amended and
restated as of the Effective Time in a form acceptable to Parent and the
Company;

 

(c)                the board of directors and executive officers of Parent
immediately after the Effective Time (the “Board”) shall be as set forth on
Exhibit D hereto;

 

(d)               the board of directors of the Surviving Corporation
immediately after the Effective Time shall be as set forth on Exhibit E hereto;
and

 

(e)                the executive officers of the Surviving Corporation
immediately after the Effective Time shall be the executive officers of the
Surviving Corporation immediately prior thereto.

 

1.5              Conversion of Shares.

 

(a)               Subject to Sections 1.5(c), 1.7 and 1.8, at the Effective
Time, by virtue of the Merger and without any further action on the part of
Parent, Merger Sub, the Company or any other Person:

 

(i)                 subject to Section 1.7(e), and except as set forth in
Section 1.5(a)(ii), each share of (A) Company Common Stock outstanding
immediately prior to the Effective Time shall be converted into the right to
receive that portion of a share of Parent Common Stock set forth on the
Spreadsheet pursuant to Section 1.5(d)(i), and (B) Company Preferred Stock
outstanding immediately prior to the Effective Time shall be converted into the
right to receive that portion of a share of Parent Common Stock set forth on the
Spreadsheet pursuant to Section 1.5(d)(ii), in each case as adjusted pursuant to
Section 1.14;

 

(ii)               each share of Company Capital Stock held in the treasury of
the Company immediately prior to the Effective Time shall be cancelled and
extinguished, and no other securities of Parent or any other corporation shall
be issuable, and no payment or other consideration shall be made, with respect
thereto; and

 

(iii)             each share of the common stock (par value $0.01 per share) of
Merger Sub outstanding immediately prior to the Effective Time shall be
converted into one share of common stock of the Surviving Corporation.

 

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(b)               At any time or from time to time between the date of this
Agreement and the Effective Time, if Parent declares or pays any dividend on
Parent Common Stock payable in Parent Common Stock or in any right to acquire
Parent Common Stock, or effects a subdivision of the outstanding shares of
Parent Common Stock into a greater number of shares of Parent Common Stock (by
stock dividends, combinations, splits, recapitalizations and the like), or if
the outstanding shares of Parent Common Stock shall be combined or consolidated,
by reclassification or otherwise, into a lesser number of shares of Parent
Common Stock, then the Parent Share Price (including the dollar amounts referred
to in the definition of Parent Share Price) and the Share Exchange Ratio shall
be appropriately adjusted.

 

(c)                No fractional shares of Parent Common Stock shall be issued
in connection with the Merger, and no certificates for any such fractional
shares shall be issued. In lieu of such fractional shares, any holder of Company
Common Stock who would otherwise be entitled to receive a fraction of a share of
Parent Common Stock shall, upon surrender of such holder’s Company Stock
Certificate(s), be paid in cash the dollar amount (rounded to the nearest whole
cent), without interest, determined by multiplying such fraction by the Parent
Share Price.

 

(d)               As soon as possible, but in any event no later than three (3)
business days, prior to the Effective Time, the Company shall deliver to Parent
and the Exchange Agent the Spreadsheet. For purposes of this Agreement,
“Spreadsheet” means a spreadsheet which shall be certified as complete and
correct by an officer of the Company, which shall include, as of immediately
prior to the Effective Time: (i) the fraction of a share of Parent Common Stock
into which one share of Company Common Stock shall be converted as a result of
the Merger; (ii) for each series of Company Preferred Stock, the fraction of a
share of Parent Common Stock into which one share of such series of Company
Preferred Stock shall be converted as a result of the Merger; (iii) the dollar
value of one share of Company Common Stock in connection with the transactions
contemplated hereby (the “Implied Merger Consideration Per Company Common
Share”); (iv) (A) the names of all Company Stockholders and their respective
addresses, (B) the number and type of shares of Company Capital Stock held by
each Company Stockholder, (C) where applicable, the respective certificate
numbers held by each Company Stockholder, and (D) the number of Closing Total
Merger Shares to be paid to each Company Stockholder at Closing in respect of
each type of shares of Company Capital Stock held by such Company Stockholder;
(v) (A) the names of all holders of Company Options and their respective
addresses, (B) the number and type of shares of Company Capital Stock underlying
each Company Option held by each such holder, (C) the grant date, expiration
date, exercise price per share, vesting schedule and vested status of each
Company Option held by each such holder and (D) the number of Company Option
Settlement Shares issuable with respect to such Company Option in accordance
with Section 1.9(a)(i); (vi) (A) the names of all holders of Company Warrants
and their respective addresses; (B) the number and type of shares of Company
Capital Stock underlying the Company Warrants held by each such holder, (C) the
grant date, expiration date, exercise price per share, vesting schedule and
vested status of each Company Warrant held by each such holder, (D) the number
of shares of Parent Common Stock for which such Company Warrant shall be
exercisable as a result of Section 1.9(b), and (E) the exercise price per share
of Parent Common Stock of such Company Warrant as a result of Section 1.9(b);
provided, that all such calculations shall be made in accordance with (1)
Section 2.1 of Article 4B of the Company’s Amended and Restated Certificate of
Incorporation dated June 8, 2012 (the “Restated Certificate”) and (2) the Share
Exchange Ratio.

 

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(e)                Notwithstanding anything in this Agreement to the contrary,
Parent shall not be obligated to issue shares of Parent Common Stock to any
Merger Stockholder or holder of Company Options that Parent, in its sole
discretion, does not reasonably believe is an “accredited investor” within the
meaning of Regulation D promulgated by the SEC under the Securities Act (each, a
“Non-Accredited Company Stockholder”) if the issuance of such shares would
result in the issuance of shares by Parent to more than thirty-five (35)
Non-Accredited Company Stockholders. In lieu of issuing such number of shares of
Parent Common Stock to which such Non-Accredited Company Stockholder would
otherwise be entitled under Sections 1.5(a) (subject, in all cases, to the
exchange procedures set forth in Section 1.7 hereof) or 1.9(a), Parent may, in
its sole discretion, elect to pay to such Non-Accredited Company Stockholder an
amount in cash (the “Substitute Cash Amount”) equal to the product of (i) such
number of Closing Net Merger Shares or Company Option Settlement Shares, as the
case may be, to which such Non-Accredited Company Stockholder is entitled under
Section 1.5(a) or 1.9(a), and (ii) the Parent Share Price; provided, that such
portion of the Substitute Cash Amount payable to any Merger Stockholder which
would otherwise be treated as Escrow Shares pursuant to Section 1.7(b)(ii) shall
be held in escrow by the Escrow Agent pursuant to all terms applicable to Escrow
Shares set forth in this Agreement and the Escrow Agreement.

 

1.6              Closing of the Company’s Transfer Books. At the Effective Time,
holders of certificates representing shares of Company Capital Stock that were
outstanding immediately prior to the Effective Time shall cease to have any
rights as stockholders of the Company, and the stock transfer books of the
Company shall be closed with respect to all shares of such Company Capital Stock
outstanding immediately prior to the Effective Time. No further transfer of any
such shares of the Company Capital Stock shall be made on such stock transfer
books after the Effective Time. If, after the Effective Time, a Company Stock
Certificate is presented to the Surviving Corporation or Parent, the shares of
Company Capital Stock formerly represented by such Company Stock Certificate
shall be canceled and shall be exchanged for shares of Parent Common Stock, as
provided in Section 1.5 and 1.7.

 

1.7              Exchange of Certificates.

 

(a)               On or prior to the Closing Date, Parent and the Company shall
agree upon, select and engage a reputable bank, transfer agent or trust company
to act as exchange agent in the Merger (the “Exchange Agent”). At the Effective
Time, Parent shall deposit with the Exchange Agent stock certificates
representing the Closing Net Merger Shares, other than the Escrow Shares, and
the Company Option Settlement Shares.

 

(b)               At the Closing, each Company Stockholder that does not perfect
its right of appraisal under Section 262 of the DGCL and is otherwise entitled
to receive Closing Net Merger Shares pursuant to Section 1.5 of this Agreement
(a “Merger Stockholder”) shall surrender to the Exchange Agent the Company Stock
Certificates representing all of such Stockholder’s shares of Company Common
Stock, properly endorsed for transfer, along with a Letter of Transmittal. As
soon as practicable after the Effective Time, the Exchange Agent shall deliver
to (i) each Merger Stockholder who has surrendered Company Stock Certificates
representing all of such Merger Stockholder’s shares of the Company Common Stock
properly endorsed for transfer, along with an executed Letter of Transmittal, a
certificate representing 90.0% of the number of Closing Net Merger Shares that
such Merger Stockholder otherwise has the right to receive pursuant to the
provisions of Section 1.5, and (ii) the Escrow Agent, on behalf of each Merger
Stockholder, a certificate representing 10.0% of the number of whole shares of
Parent Common Stock that such Merger Stockholder otherwise has the right to
receive pursuant to the provisions of Section 1.5, rounded up to the nearest
whole share (the “Escrow Shares”), which Escrow Shares shall be held (and
released) in accordance with the provisions of Sections 1.14(b), 10.6, 10.7,
10.8 and the terms of the Escrow Agreement. If any Company Stock Certificate
shall have been lost, stolen or destroyed, Parent may, in its discretion and as
a condition precedent to the issuance of any certificate representing Parent
Common Stock, require the owner of such lost, stolen or destroyed Company Stock
Certificate to provide an appropriate affidavit and to deliver a bond (in such
sum as Parent may reasonably direct) as indemnity against any claim that may be
made against Parent or the Surviving Corporation with respect to such Company
Stock Certificate.

 

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(c)                No dividends or other distributions declared or made with
respect to Parent Common Stock with a record date after the Effective Time shall
be paid to the holder of any unsurrendered Company Stock Certificate with
respect to the shares of Parent Common Stock represented thereby, and no cash
payment in lieu of any fractional share shall be paid to any such holder, until
such holder surrenders such Company Stock Certificate in accordance with this
Section 1.7 (at which time such holder shall be entitled to receive all such
dividends and distributions and such cash payment).

 

(d)               Parent and the Surviving Corporation shall be entitled to
deduct and withhold from any consideration payable or otherwise deliverable to
any holder or former holder of Company Capital Stock pursuant to this Agreement
such amounts as Parent or the Surviving Corporation may be required to deduct or
withhold therefrom under the Code or under any provision of state, local or
foreign tax law, if any. To the extent such amounts are so deducted or withheld,
such amounts shall be treated for all purposes under this Agreement as having
been paid to the Person to whom such amounts would otherwise have been paid.

 

(e)                Neither Parent nor the Surviving Corporation shall be liable
to any holder or former holder of Company Capital Stock for any shares of Parent
Common Stock (or dividends or distributions with respect thereto), or for any
cash amounts, delivered to any public official pursuant to any applicable
abandoned property, escheat or similar law.

 

1.8              Appraisal Shares.

 

(a)               Notwithstanding anything to the contrary contained in this
Agreement, Appraisal Shares (as defined in Section 1.8(c) below) shall not be
converted into or represent the right to receive Parent Common Stock in
accordance with Section 1.5(a) (or cash in lieu of fractional shares in
accordance with Section 1.5(c)), and each holder of Appraisal Shares shall be
entitled only to such rights with respect to such Appraisal Shares as may be
granted to such holder in Section 262 of the DGCL. From and after the Effective
Time, a holder of Appraisal Shares shall not have and shall not be entitled to
exercise any of the voting rights or other rights of a stockholder of the
Surviving Corporation. If any holder of Appraisal Shares shall fail to perfect
or shall waive, rescind, withdraw or otherwise lose such holder’s right of
appraisal under Section 262 of the DGCL, then (i) any right of such holder to
require the Company to purchase the Appraisal Shares for cash shall be
extinguished and (ii) in accordance with Section 1.7(a), such shares shall
automatically be converted into and shall represent only the right to receive
(upon the surrender of the certificate or certificates representing such shares)
Parent Common Stock, and cash in lieu of any fractional share in accordance with
Section 1.5(c), if appropriate.

 

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(b)               The Company (i) shall give Parent prompt written notice of any
demand by any Company Stockholder for appraisal of such Company Stockholder’s
shares of Company Capital Stock pursuant to the DGCL and of any other notice
demand or instrument delivered to the Company pursuant to the DGCL and (ii)
shall give Parent’s Representatives the opportunity to participate in all
negotiations and proceedings with respect to any such notice, demand or
instrument. The Company shall not make any payment or settlement offer with
respect to any such notice or demand unless Parent shall have consented in
writing to such payment or settlement offer.

 

(c)                For purposes of this Agreement, “Appraisal Shares” shall
refer to any shares of Company Capital Stock outstanding immediately prior to
the Effective Time that are held by Company Stockholders who are entitled to
demand and who properly demand appraisal of such shares pursuant to, and who
comply with the applicable provisions of, Section 262 of the DGCL.

 

1.9              Treatment of Company Options and Company Warrants.

 

(a)               Company Options.

 

(i)                 Each unexpired and unexercised Company Option outstanding as
of immediately prior to the Effective Time shall be accelerated and deemed
vested, and shall be converted automatically into the right to receive, subject
to the exchange procedures set forth in Section 1.7 (provided, that such holder
shall execute and deliver an Option Holder Letter of Transmittal), such number
of shares of Parent Common Stock equal to the product of (i) (A) (1) the Implied
Merger Consideration Per Company Common Share, minus (2) the exercise price
payable in respect of each share of Company Common Stock underlying such Company
Option, divided by (B) the Parent Share Price, and (ii) the total number of
shares underlying such Company Option; provided, that fractional shares of
Parent Common Stock shall be treated in accordance with Section 1.5(c) (such
shares of Parent Common Stock issuable to holders of Company Options under this
Section 1.9(a)(i), collectively, the “Company Option Settlement Shares”).

 

(ii)               Without limiting the generality of the foregoing, the Company
shall take all actions as are necessary prior to Closing to ensure that neither
Parent nor the Surviving Corporation shall, after the Effective Time, be bound
by any Company Option.

 

(b)               Company Warrants. From and after the Effective Time, each
unexpired and unexercised Company Warrant then outstanding shall automatically,
by virtue of the Merger, be adjusted such that the Company Warrant shall be
exercisable for that number of shares of Parent Common Stock equal to the
product of (i) the number of shares of Company Common Stock subject to the
Company Warrant immediately prior to the Effective Time and (ii) the fraction of
a share of Parent Common Stock into which one share of Company Common Stock or
Company Preferred Stock, as the case may be, shall be converted as a result of
the Merger as set forth on the Spreadsheet (and rounded to the nearest share in
accordance with established mathematical principles), with an exercise price per
share of Parent Common Stock equal to the quotient of (A) the exercise price per
share that existed under the corresponding Company Warrant divided by (B) such
fraction of a share of Parent Common Stock into which one share of Company
Common Stock or Company Preferred Stock, as the case may be, shall be converted
as a result of the Merger as set forth in the Spreadsheet (and rounded to the
nearest cent in accordance with established principles).

 

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1.10          Share Repurchase Right. Prior to the Closing, the Company shall
have the right to repurchase up to $13,125,000 in shares of the Company’s
Capital Stock from one or more Company Stockholders (the “Repurchased Shares”).
The terms and conditions of the Company’s acquisition of any Repurchased Shares
shall be negotiated by the Company on an arm’s-length basis, in good faith, with
the holder(s) thereof, and the purchase price for such Repurchased Shares will
be paid in the form of (a) cash, (b) Company Recap Notes or (c) a combination of
cash and Company Recap Notes; provided, that in no event shall the total amount
of cash and Company Recap Notes issued to all such Company Stockholders exceed
the $13,125,000.

 

1.11          Backstop Fee Agreement. On or prior to the Closing, the Company
shall have the right to enter into the Backstop Fee Agreement with PAR in
consideration for its execution and delivery of the Backstop Agreement prior to
the Execution Date.

 

1.12          Tax Consequences. For federal income tax purposes, the Merger is
intended to constitute a reorganization within the meaning of Section 368 of the
Code. The parties to this Agreement hereby adopt this Agreement as a “plan of
reorganization” within the meaning of Sections 1.368-2(g) and 1.368-3(a) of the
United States Treasury Regulations.

 

1.13          Further Action. If, at any time after the Effective Time, any
further action is reasonably determined by Parent to be necessary or desirable
to carry out the purposes of this Agreement or to vest the Surviving Corporation
or Parent with full right, title and possession of and to all rights and
property of Merger Sub and the Company, the officers and directors of the
Surviving Corporation and Parent shall be fully authorized (in the name of
Merger Sub, in the name of the Company and otherwise, as the case may be) to
take such action.

 

1.14          Adjustments to Net Merger Consideration and Merger Shares.

 

(a)               Calculation of Estimated Net Merger Consideration. Not later
than three (3) business days prior to the Closing, the Company shall deliver to
Parent a certificate signed by the Company’s Chief Executive Officer setting
forth (i) a consolidated balance sheet of the Company (the “Estimated Closing
Balance Sheet”), (ii) a calculation of Closing Date Working Capital (the
“Estimated Closing Date Working Capital”) and (iii) a calculation of
Indebtedness (the “Estimated Indebtedness”), in each case estimated as of 12:01
a.m. on the Closing Date (the “Adjustment Calculation Time”), which calculations
shall be prepared in accordance with GAAP in a manner consistent with the
preparation of the Financial Statements, along with reasonable supporting detail
therefor. The amount, if any, by which the Estimated Closing Date Working
Capital is less than the Closing Date Working Capital Target shall be referred
to herein as the “Estimated Working Capital Shortfall,” and the amount, if any,
by which the Estimated Working Capital is greater than the Closing Date Working
Capital Target shall be referred to herein as the “Estimated Working Capital
Surplus.”

 

-7-

 

 

(b)               Post-Closing Adjustments.

 

(i)                 As soon as practicable, but in any event no later than
ninety (90) days, after the Closing, Parent shall deliver to Stockholders’ Agent
a statement (a “Closing Statement”) setting forth, as of the Adjustment
Calculation Time, (A) the consolidated balance sheet of the Company (the
“Closing Balance Sheet”), (B) the Closing Date Working Capital (the “Final
Working Capital”) and (C) the Indebtedness (the “Final Indebtedness”). The
Closing Statement shall be prepared in accordance with GAAP in a manner
consistent with the preparation of the Financial Statements. The amount, if any,
by which the Final Working Capital is less than the Closing Date Working Capital
Target shall be referred to herein as the “Final Working Capital Shortfall,” and
the amount, if any, by which the Final Working Capital is greater than the
Closing Date Working Capital Target shall be referred to herein as the “Final
Working Capital Surplus.”

 

(ii)               For a period of thirty (30) days following the date on which
the Closing Statement is delivered to the Stockholders’ Agent (such date
referred to herein as the “Delivery Date”), Parent shall make available during
customary business hours and on reasonable notice to the Stockholders’ Agent and
its auditors, all records and work papers used in preparing the Closing
Statement.

 

(iii)             If the Stockholders’ Agent disagrees with the computation of
the Final Working Capital reflected in the Closing Statement, the Stockholders’
Agent may, within thirty (30) days after the Delivery Date, deliver a notice (an
“Objection Notice”) to Parent setting forth the Stockholders’ Agent’s
calculation of such items (including reasonable detail regarding the calculation
of such items). If the Stockholders’ Agent does not deliver an Objection Notice
within such thirty (30) day period, then the Closing Statement prepared by
Parent shall be deemed to have been accepted by the Stockholders’ Agent. If the
Stockholders’ Agent delivers an Objection Notice, Parent and the Stockholders’
Agent shall use each of its reasonable best efforts to resolve any
disagreements, but if they do not obtain a final resolution within thirty (30)
days after Parent has received the Objection Notice, Parent and the
Stockholders’ Agent, shall jointly retain PriceWaterhouseCoopers (the
“Accountant”) to resolve any remaining disagreements within thirty (30) days of
its engagement. The Accountant’s determination shall be based upon the terms of
this Agreement and shall, absent manifest error, be conclusive and binding upon
the parties hereto. The date on which the Final Working Capital and the Final
Indebtedness is finally determined in accordance with this Section 1.14(b)(iii)
shall be referred to herein as the “Determination Date.”

 

(iv)             If the number of Final Net Merger Shares is greater than the
number of Closing Net Merger Shares, within five (5) business days of the
Determination Date, Parent shall issue and cause to be delivered to the Merger
Stockholders such number of shares of Parent Common Stock, in the aggregate,
equal to such difference, in accordance with their respective holdings of
Company Common Stock immediately prior to the consummation of the Merger. If the
number of Final Net Merger Shares is less than the number of Closing Net Merger
Shares, within five (5) business days of the Determination Date, the
Stockholders’ Agent and Parent shall direct the Escrow Agent to deliver to
Parent such number of Escrow Shares equal to such difference in accordance with
the terms of the Escrow Agreement.

 

-8-

 

 

1.15          Parent Committee. At the Closing, the Board of Directors of Parent
shall appoint a committee consisting of (x) two (2) of its members as of prior
to the Closing, who shall be Harry Sloan and Jeffrey Sagansky, and (y) two (2)
“independent” directors of Parent as of after the Closing, who shall be agreed
to by each of Parent and the Company prior to the Closing, to act on behalf of
Parent to take all necessary actions and make all decisions pursuant to (a) the
matters set forth in Section 1.14(b) and (b) the Escrow Agreement regarding
Parent’s right to indemnification pursuant to Section 10 (the “Post-Closing
Matters”). In the event of a vacancy in such committee, the Board of Directors
of Parent shall appoint as a successor a Person who was a director of Parent
prior to the Closing Date or some other Person who would qualify as an
“independent” director of Parent and who has not had any relationship with the
Company prior to the Closing. For the avoidance of doubt, such committee shall
have the power and authority to act on behalf of Parent, without any further
approval or consent required from any director, officer or stockholder of
Parent, to take any necessary action and make any necessary decision on behalf
of Parent with respect to the Post-Closing Matters.

  

  Section 2. Representations and Warranties of the Company

  

The Company hereby represents and warrants, to and for the benefit of Parent, as
follows:

 

2.1              Organization; Qualification. The Company is a corporation duly
incorporated validly existing and in good standing under the laws of the State
of Delaware and has all requisite corporate power and authority to carry on its
business as now conducted and as proposed to be conducted. Each Subsidiary is an
entity duly organized, validly existing and in good standing under the laws of
the jurisdiction of its incorporation or organization (as applicable) and has
all requisite power and authority to carry on its business as now conducted and
as proposed to be conducted. Each of the Company and its Subsidiaries is duly
qualified to transact business and is in good standing in each jurisdiction in
which it is so required under applicable laws, except where the failure to do
so, has not had or could reasonably be expected to have, individually or in the
aggregate, a Material Adverse Effect. Section 2.1 of the Schedule of Exceptions
sets forth each jurisdiction in which the Company and each Subsidiary is
qualified.

 

2.2              Power; Authorization. The Company has all requisite corporate
power to enter into, execute and deliver this Agreement and each of the
Transaction Agreements to perform its obligations hereunder and thereunder, and
the execution, delivery and performance by the Company of this Agreement and the
Transaction Agreements have been duly authorized by all necessary action on the
part of the Board. This Agreement and each of the Transaction Agreements are the
valid and binding obligations of the Company, enforceable in accordance with
their respective terms, except as the same may be limited by bankruptcy,
insolvency, reorganization, fraudulent conveyance, moratorium, or other laws of
general application relating to or affecting enforcement of creditors’ rights
and the rules or laws governing specific performance, injunctive relief or other
equitable remedies.

 

-9-

 

 

2.3              Non-Contravention. The execution and delivery by the Company of
this Agreement and the other Transaction Agreements and the performance and
consummation of the transactions contemplated hereby and thereby do not and will
not (i) violate (A) the organizational documents of the Company or any of its
Subsidiaries, including, without limitation, the Restated Certificate or the
Company’s bylaws (collectively, the “Charter Documents”), or (B) any judgment,
order, writ, decree, ruling, charge, statute, rule, regulation or other
restriction of any Governmental Body applicable to the Company, (ii) except as
set forth in Section 2.3 of the Schedule of Exceptions, conflict with, result in
a breach of, constitute a default under, result in the acceleration of, create
in any party the right to accelerate, terminate, modify or cancel, or require
any notice under, any Contract to which any of the Company or any of its
Subsidiaries is a party or by which it is bound or to which any of its assets
are subject, or (iii) result in the creation or imposition of any Encumbrance
upon any property, asset or revenue of the Company or any Subsidiary or the
suspension, revocation, impairment, forfeiture or nonrenewal of any material
permit, license, authorization or approval applicable to the Company or any
Subsidiary, their respective businesses or operations, or their respective
assets or properties.

 

2.4              Capitalization. Immediately prior to the Closing, the
authorized and outstanding capital of the Company will consist of:

 

(a)               378,848,172 shares of Company Preferred Stock, of which (i)
9,794,142 shares have been designated as Series A-1 Preferred Stock, all of
which are issued and outstanding, (ii) 19,887,000 shares have been designated as
Series A-2 Preferred Stock, all of which are issued and outstanding, (iii)
73,783,872 shares have been designated as Series B-1 Preferred Stock, all of
which are issued and outstanding, (iv) 62,326,439 shares have been designated as
Series B-2 Preferred Stock, all of which are issued and outstanding, (v)
105,868,792 shares have been designated as Series C-1 Preferred Stock, of which
84,695,034 are issued and outstanding and (vi) 107,187,927 shares have been
designated as Series C-2 Preferred Stock, of which 85,750,341 are issued and
outstanding. The rights, preferences and privileges of the Company Preferred
Stock are as set forth in the Restated Certificate. All of the outstanding
shares of Company Preferred Stock have been duly authorized, are fully paid and
nonassessable and were issued in compliance with all applicable federal and
state securities laws.

 

(b)               900,000,000 shares of Company Common Stock, of which
154,115,079 shares are issued and outstanding. All of the outstanding shares of
Company Common Stock have been duly authorized, are fully paid and nonassessable
and were issued in compliance with all applicable federal and state securities
laws.

 

(c)                an aggregate of 65,000,000 shares of Company Common Stock
have been reserved for issuance to officers, directors, employees and
consultants of the Company pursuant to the Stock Plan. Of such reserved shares
of Company Common Stock, 47,573,932 shares have been allocated to options and
17,393,568 remain available for issuance under the 2011 Equity Incentive Plan.
All outstanding options are subject to the terms, conditions and restrictions
set forth in the 2011 Equity Incentive Plan. Except as set forth in Section
2.4(c) of the Schedule of Exceptions, the Company has not adjusted or amended
the exercise price of any stock option previously awarded, whether through
amendment, cancellation, replacement grant, repricing or otherwise.

 

-10-

 

 

(d)               warrants (including any warrants which have been authorized by
the Board, but not yet issued by the Company) to purchase an aggregate of (i)
175,122,105 shares of Company Common Stock and (ii) 42,611,344 shares of Company
Preferred Stock (collectively, the “Company Warrants”).

 

(e)                Section 2.4(e) of the Schedule of Exceptions sets forth the
capitalization of the Company immediately prior to and following the Closing,
including all issued and outstanding shares of Company Common Stock, outstanding
stock options, stock options or shares of Common Stock reserved but not yet
granted under the 2011 Equity Incentive Plan, all Company Preferred Stock to be
issued and outstanding as of such time, all accrued dividends due on each series
of Company Preferred Stock currently outstanding, all warrants presently
outstanding and any other stock purchase rights or convertible securities.
Except as set forth in the Restated Certificate, the Company has no obligation
(contingent or otherwise) to purchase or redeem any of its capital stock. No
stock plan, stock purchase, stock option or other agreement or understanding
between the Company and any holder of equity securities or rights to purchase
equity securities provides for acceleration or other changes in the vesting
provisions or terms of such agreements or understandings, or the lapse of a
Company repurchase right, upon the occurrence of any event or combination of
events. All outstanding stock options granted to officers, directors or
employees of the Company have an exercise price equal to or greater than the
fair market value of the underlying stock as of the date of grant. Other than as
set forth in this Section 2.4, the Company is not party to any other outstanding
option, warrant, right (including conversion or preemptive rights and rights of
first refusal or similar rights) proxy, voting, transfer restriction or
stockholder agreement or agreement of any kind, orally or in writing, for the
purchase or acquisition from the Company of any shares of its capital stock.
Except as set forth on Section 2.4(e) of the Schedule of Exceptions, no person
or entity has any right to acquire any securities of the Company or any option
or warrant to acquire any securities of the Company based on any broker, finder
or investment banking type relationship with the Company.

 

(f)                Section 2.4(f) of the Schedule of Exceptions provides an
accurate and complete list of the name of and last address known by the Company
of each Stockholder, the number and class of Company Capital Stock owned by such
Stockholder as of the date of this Agreement, the date such Company Capital
Stock was purchased, the price paid per share, the form of consideration used
(if not cash), the number of such shares that are subject to a repurchase right
held by the Company, if any, the schedule of expiration of such repurchase right
and the cost to the Company to repurchase any such shares.

 

(g)               Section 2.4(g) of the Schedule of Exceptions accurately sets
forth, with respect to each Company Option that is outstanding as of the date of
this Agreement (i) the name of the holder of such Company Option and (ii) the
total number of shares of Company Common Stock that are subject to such Company
Option and the number of shares of Company Common Stock with respect to which
such Company Option is immediately exercisable, (iii) the date on which such
Company Option was granted and the term of such Company Option, (iv) the vesting
schedule for such Company Option and (v) the exercise price per share of Company
Common Stock purchasable under such Company Option. Section 2.4(g) of the
Schedule of Exceptions also accurately sets forth, with respect to each Company
Warrant that is outstanding as of the date of this Agreement: (A) the name of
the holder of such Company Warrant; (B) the total number of shares of Company
Common Stock or Company Preferred Stock that are subject to such Company
Warrant; (C) the exercise price per share of Company Common Stock or Company
Preferred Stock purchasable under such Company Warrant; (D) the date of such
Company Warrant; and (E) the expiration date of such Warrant. The Company has
delivered to Parent accurate and complete copies of each Company Warrant that is
outstanding as of the date of this Agreement.

 

-11-

 

 

(h)               All of the outstanding shares of Company Capital Stock have
been issued in compliance with all applicable federal and state securities laws
and other Legal Requirements and were not issued in violation of or subject to
any preemptive rights or other rights to subscribe for or purchase securities of
the Company. All outstanding Company Options, Company Warrants and other
securities of the Company were duly authorized, have been granted or issued (as
applicable) in compliance with all federal and state securities laws and other
Legal Requirements and were not issued in violation of or subject to any
preemptive rights or other rights to subscribe for or purchase securities of the
Company. Except as set forth on Section 2.4(h) of the Schedule of Exceptions,
there are no preemptive rights applicable to any shares of capital stock of the
Company.

 

(i)                 All of the stock or other equity securities in each
Subsidiary owned by the Company is owned by the Company free and clear of any
Encumbrance. All of the outstanding stock or equity securities of each
Subsidiary has been duly authorized and validly issued and is fully paid and
nonassessable, has been issued in compliance with all applicable federal, state
and foreign securities laws and other Legal Requirements and was not issued in
violation of or subject to any preemptive rights or other rights to subscribe
for or purchase securities of the Subsidiary. There are no options, warrants or
other rights outstanding to subscribe for or purchase any shares of the capital
stock of the Subsidiary and the Subsidiary is not subject to any obligation,
commitment, plan, arrangement or court or administrative order with respect to
same. There are no preemptive rights applicable to any shares of capital stock
of the Subsidiary.

 

(j)                 The Company has never declared, accrued, set aside or paid
any dividend or made any other distribution in respect of any shares of its
capital stock, nor has the Company redeemed, repurchased or otherwise reacquired
any shares of its capital stock or other security other than repurchases at the
lower of cost or the current fair market value thereof from former employees in
accordance with the terms of such employees’ purchase agreements.

 

(k)               The Company is not subject to the requirements of subdivision
(b) of Section 2115 of the California Corporations Code.

 

2.5              No Violation or Default; Compliance with Legal Requirements.
Except as set forth in Section 2.5 of the Schedule of Exceptions, neither the
Company nor any Subsidiary is in violation of or default under any provision of
its organizational documents, any provision of any mortgage, indenture,
agreement, instrument or contract to which it is a party or by which it is
bound, or any federal or state judgment, order, writ, decree, statute, rule or
regulation applicable to it. The Company has complied with each, and is not in
material violation of any, applicable Legal Requirement (i) in the United
States, to which the Company or its business, operations, employees, assets or
properties are or have been subject, and (ii) outside the United States, to
which the Company or its business, operations, employees, assets or properties
are or have been subject, except to the extent that such violations, have not
had, or could not reasonably be expected to have, individually or in the
aggregate, a Material Adverse Effect. Neither the Company nor any Subsidiary has
received notice regarding any violation of, conflict with, or failure to comply
with, any Legal Requirement. To the Company’s knowledge, no suit, proceeding,
hearing, investigation or formal governmental complaint has been filed or
commenced against the Company or any Subsidiary alleging any failure to so
comply. The Company has not, and to the Company’s knowledge, no agent,
representative, contractor, officer, director, stockholder, member, employee or
manager of the Company has, (A) acting at the direction or on behalf of the
Company, made, paid or received any unlawful bribes, kickbacks or other similar
payments to or from any Person (including any customer or supplier) or
Governmental Body, (B) acting at the direction of or on behalf of the Company,
made or paid any contributions, directly or indirectly, to a domestic or foreign
political party or candidate or (C) acting at the direction or on behalf of the
Company, has made or paid any improper foreign payment (as defined in Foreign
Corrupt Practices Act of 1977, as amended).

 

-12-

 

 

2.6              Brokers or Finders. Except as set forth in Section 2.6 of the
Schedule of Exceptions, no Person has or will have, as a result of any act or
omission of the Company or any Subsidiary, any right, interest or valid claim
against the Company or any Subsidiary for any commission, fee or other
compensation as a finder or broker in connection with the transactions
contemplated by the Agreement.

 

2.7              Litigation. Except as set forth in Section 2.7 of the Schedule
of Exceptions, there is no Legal Proceeding pending or, to the Company’s
knowledge, currently threatened against the Company or any Subsidiary or any
officer or director of the Company or any Subsidiary. None of the Legal
Proceedings set forth on Section 2.7 of the Schedule of Exceptions (a) questions
the validity of this Agreement or the right of the Company to consummate the
Merger and the other transactions contemplated hereby or (b) has had, or could
be reasonably expected to have, either individually or in the aggregate, a
Material Adverse Effect, nor is the Company aware that there is any basis for
the foregoing. Neither the Company nor any of its Subsidiaries nor, to the
Company’s knowledge, any of their respective officers or directors, is a party
to or is named as subject to the provisions of any order, writ, injunction,
judgment or decree of any court or Governmental Body. Except as set forth in
Section 2.7 of the Schedule of Exceptions, no action, claim, suit or proceeding
has been made, filed by or against the Company or any Subsidiary since January
1, 2009. There is no action, suit, proceeding or investigation by the Company or
any Subsidiary pending or which the Company or any Subsidiary intends to
initiate. The foregoing includes, without limitation, Legal Proceedings pending
or threatened in writing (or any basis therefor known to the Company) involving
the prior employment of any of the Company’s or any Subsidiary’s employees,
their use in connection with the Company’s or any Subsidiary’s business, or any
information or techniques allegedly proprietary to any of their former
employers, or their obligations under any agreements with prior employers.

 

2.8              Title to Property and Assets. The Company and each of its
Subsidiaries have good and valid title to all of their respective properties and
assets free and clear of any and all Encumbrances, except as set forth in
Section 2.8 of the Schedule of Exceptions. With respect to all leased property
and assets, the Company and its Subsidiaries are in compliance with such leases
and hold valid leasehold interests free of any and all Encumbrances other than
to the lessors of such properties or assets.

 

-13-

 

 

2.9              Intellectual Property.

 

(a)               All registered patents, trademarks and copyrights and all
applications therefor, in each case for the Company and its Subsidiaries, are
listed in Section 2.9(a) of the Schedule of Exceptions. The Company: (i) is the
true and lawful owner or licensee of the trademarks and trademark applications
listed in Section 2.9(a) of the Schedule of Exceptions, and said listed
trademarks and trademark applications constitute all the marks registered in the
United States Patent and Trademark Office and applications for trademarks that
the Company now owns or uses in connection with its business; (ii) is the true
and lawful owner or licensee of all rights in the patents and patent
applications listed in Section 2.9(a) of the Schedule of Exceptions and said
patents and patent applications constitute all the United States patents and
applications for United States patents that the Company now owns or uses in
connection with its business; (iii) is the true and lawful owner or licensee of
all rights in the copyright registrations listed in Section 2.9(a) of the
Schedule of Exceptions and said copyrights constitute all the registered United
States copyrights that the Company now owns or uses; (iv) is the true and lawful
owner or licensee of all rights in the registered service marks and service mark
applications listed in Section 2.9(a) of the Schedule of Exceptions and said
service marks constitute all the service marks that the Company now owns or
uses; (v) is the true and lawful owner or licensee of all rights in the
unregistered trade names and corporate names listed in Section 2.9(a) of the
Schedule of Exceptions and said names constitute all the trade names and
corporate names that the Company now owns or uses; and (vi) is the true and
lawful owner or licensee of all rights in the domain names listed in Section
2.9(a) of the Schedule of Exceptions, and said domain names constitute all the
domain names that the Company now owns or uses.

 

(b)               The Company and its Subsidiaries own or possess sufficient
legal rights to all Company Intellectual Property as are necessary to the
conduct of their respective businesses as now conducted and as presently
contemplated to be conducted, without any known conflict with, or infringement
of, the rights of others. Except for Company Intellectual Property owned by
third parties or as set forth in Section 2.9(b) of the Schedule of Exceptions,
the Company or a Subsidiary is the sole and exclusive owner, with all right,
title and interest in and to (free and clear of all Encumbrances), all Company
Intellectual Property, has sole and exclusive rights (and is not contractually
obligated to pay any compensation to any third party in respect thereof or in
connection with the use, sale, distribution, licensing or other exploitation
thereof or as a result of the transactions contemplated by this Agreement) to
the use, sale, distribution, licensing or other exploitation therefor, and no
current or former stockholder, employee, consultant or director of the Company
or any Subsidiary has any right in or interest to any Company Intellectual
Property. No product or service marketed or sold (or proposed to be marketed or
sold) by the Company violates or, to the Company’s knowledge, will violate any
license or infringe any intellectual property rights of any other party.

 

(c)                The Company and its Subsidiaries have taken commercially
reasonable measures, as appropriate, to maintain and protect the proprietary
nature of the Company Intellectual Property, and to maintain in confidence all
trade secrets and confidential information that Company owns or for which it has
such obligation.

 

-14-

 

 

(d)               To the Company’s knowledge, there is no unauthorized use,
infringement or misappropriation of any of the Company Intellectual Property by
any third party, including any employee or former employee of the Company. There
is no pending or, to the Company’s knowledge, threatened complaint, action,
suit, claim, proceeding, other dispute or investigation, asserting the
invalidity, misuse or unenforceability of any Company Intellectual Property,
contesting ownership of any Company Intellectual Property, or otherwise
challenging any of the Company’s or its Subsidiaries’ rights in or use of the
Company Intellectual Property, and, to the Company’s knowledge, no valid grounds
for the same exist.

 

(e)                Except for standard commercially available end-user, object
code, internal-use software license and support/maintenance agreements, there
are no outstanding options, licenses, or agreements of any kind relating to the
foregoing, nor is the Company or any of its Subsidiaries bound by or a party to
any options, licenses or agreements of any kind with respect to the patents,
trademarks, service marks, trade names, domain names, copyrights, trade secrets,
licenses, information, proprietary rights and processes of any other Person.
Neither the Company nor any of its Subsidiaries has received any communications
alleging that the Company or any of its Subsidiaries has violated, diluted or
infringed or, by conducting its business as proposed, would violate, dilute or
infringe any of the patents, trademarks, service marks, tradenames, copyrights,
trade secrets or other proprietary rights or processes of any other Person. The
Company and its Subsidiaries have obtained and possess valid licenses to use all
of the software programs present on the computers and other software-enabled
electronic devices that they own or lease or that they have otherwise provided
to their employees for their use in connection with their respective businesses.

 

(f)                For purposes of this Section 2.9, the Company shall be deemed
to have knowledge of a patent right if the Company has actual knowledge of the
patent right or would be found to be on notice of such patent right as
determined by reference to United States patent laws.

 

2.10          Disclosure. This Agreement (including the Schedule of Exceptions)
does not (i) contain any representation, warranty or information regarding the
Company or any Subsidiary that is false or misleading with respect to any
material fact or (ii) omit to state any material fact necessary in order to make
the representations, warranties and information regarding the Company and each
of its Subsidiaries contained herein (in the light of the circumstances under
which such representations, warranties and information were made or provided)
not false or misleading.

 

2.11          Financial Statements; Accounting Controls.

 

(a)               The Company has furnished to Parent its audited consolidated
financial statements (including balance sheet, income statement and statement of
cash flows) as of December 31, 2010 and for the fiscal year ended December 31,
2010, its audited consolidated financial statements as of December 31, 2011 and
for the fiscal year ended December 31, 2011 and its unaudited financial
statements as of June 30, 2012 (the “Balance Sheet Date”) and for the six month
period ended June 30, 2012 (collectively, the “Financial Statements”). The
Financial Statements have been prepared in accordance with generally accepted
accounting principles applied on a consistent basis throughout the periods
indicated (“GAAP”), and are consistent with the books and records of the Company
and its Subsidiaries. The Financial Statements fairly present in all material
respects the financial condition and operating results of the Company and its
Subsidiaries as of the dates, and for the periods, indicated therein, except
with respect to the absence of footnotes in connection with all Financial
Statements for the June 30, 2012 interim period. Except as set forth in the
Financial Statements, neither the Company nor its Subsidiaries has any material
liabilities or obligations, contingent or otherwise, other than liabilities
incurred in the ordinary course of business subsequent to the Balance Sheet
Date.

 

-15-

 

 

(b)               The Company and its Subsidiaries have no liability or
obligation, absolute or contingent (individually or in the aggregate), except
obligations and liabilities incurred after the date of incorporation in the
ordinary course of business that are not material, individually or in the
aggregate and except as set forth in the Financial Statements.

 

(c)                The Company maintains accounting controls and systems which
are sufficient to provide reasonable assurances that (i) all transactions are
executed in accordance with management’s general or specific authorization, (ii)
all transactions are recorded as necessary to permit the accurate preparation of
financial statements in conformity with generally accepted accounting principles
and to maintain proper accountability for items, (iii) access to their property
and assets is permitted only in accordance with management’s general or specific
authorization, and (iv) the recorded accountability for items is compared with
the actual levels at reasonable intervals and appropriate action is taken with
respect to any differences.

 

2.12          Changes. Since the Balance Sheet Date, except for the transactions
contemplated by this Agreement and except as otherwise set forth on Section 2.12
to the Schedule of Exceptions, there has not been:

 

(a)               any change in the assets, liabilities, financial condition,
operating results or prospects of the Company or its Subsidiaries that has
constituted, or could reasonably be expected to constitute, individually or in
the aggregate, a Material Adverse Effect;

 

(b)               any damage, destruction or loss, whether or not covered by
insurance;

 

(c)                any cancellation, waiver, release or compromise by the
Company or any of its Subsidiaries of a valuable right or claim or of a material
debt owed to it;

 

(d)               any satisfaction or discharge of any Encumbrance or payment of
any obligation by the Company or any of its Subsidiaries, except in the ordinary
course of business and the satisfaction or discharge of which has not had nor
could reasonably be expected to have, individually or in the aggregate, a
Material Adverse Effect;

 

(e)                any material change or amendment to, or termination of, a
Material Contract by which the Company or any of its Subsidiaries or any of
their respective assets is bound or subject;

 

-16-

 

 

(f)                any material change in any compensation arrangement or
agreement with any employee, officer, director or stockholder;

 

(g)               any sale, assignment, license or transfer by the Company or
any of its Subsidiaries of any Company Intellectual Property or other intangible
assets of the Company and its Subsidiaries;

 

(h)               any sale, lease, transfer, assignment or transfer by the
Company or any of its Subsidiaries of any material portion of its assets, other
than for a fair consideration in the ordinary course of its business;

 

(i)                any resignation or termination of employment of any executive
officer or Key Employee of the Company or any of its Subsidiaries;

 

(j)                any material change, except in the ordinary course of
business, in a contingent obligation of the Company or any of its Subsidiaries
by way of guaranty, endorsement, indemnity, warranty or otherwise;

 

(k)               any mortgage, pledge, transfer of a security interest in, or
lien, created by the Company or any of its Subsidiaries, with respect to any of
its material properties or assets, except liens for Taxes not yet due or payable
and liens that arise in the ordinary course of business and do not materially
impair the Company’s or any Subsidiary’s ownership or use of such property or
assets;

 

(l)                any loans or guarantees made by the Company or any of its
Subsidiaries to or for the benefit of its employees, officers or directors, or
any members of their immediate families, other than travel advances and other
advances made in the ordinary course of its business;

 

(m)             any declaration, setting aside or payment or other distribution
in respect to any of the Company’s capital stock, or any direct or indirect
redemption, purchase, or other acquisition of any of such stock by the Company;

 

(n)              any notice received that any customer or supplier has
terminated or materially reduced, or threatened to terminate or materially
reduce, its purchases from or provision of products or services to the Company
or any of its Subsidiaries;

 

(o)               any write off as uncollectible, or the establishment of any
extraordinary reserve with respect to, any account receivable or other
indebtedness;

 

(p)               the (i) establishment or adoption of any Plan, (ii) amendment
of any Plan in any material respect, or (iii) the payment of any bonus,
profit-sharing or similar payment to any of its directors, officers or
employees;

 

(q)               any change in the Company’s methods of accounting or
accounting practices in any respect;

 

(r)               any material Tax election;

 

-17-

 

 

(s)                the commencement or any Legal Proceeding by or against the
Company or any of its Subsidiaries;

 

(t)                 to the Company’s knowledge, any other event or condition of
any character, other than events affecting the economy or the Company’s industry
generally, that has resulted in or could reasonably be expected to result in,
individually or in the aggregate, a Material Adverse Effect;

 

(u)               any capital expenditure (or series of related capital
expenditures) outside the ordinary course of business of the Company and its
Subsidiaries;

 

(v)               the issuance of any note, bond or other debt security by the
Company or any of its Subsidiaries, or the creation, incurrence, assumption or
guarantee of any indebtedness for borrowed money or capitalized lease obligation
outside the ordinary course of business;

 

(w)             any delay or postponement of the payment of accounts payable and
other liabilities of the Company or its Subsidiaries outside the ordinary course
of business;

 

(x)               any change made or authorized in the organizational documents
of the Company or any of its Subsidiaries;

 

(y)               the entry into, termination or modification of any collective
bargaining agreement (or otherwise becoming bound by the terms of any collective
bargaining arrangement) by the Company or any of its Subsidiaries, or

 

(z)                any arrangement or commitment by the Company or any of its
Subsidiaries to do any of the things described above.

 

2.13          Taxes. The Company and each of its Subsidiaries have duly and
timely filed all material Tax Returns and reports (including information returns
and reports) as required by law. All such Tax Returns were correct and complete
in all material respects and were prepared in substantial compliance with all
applicable Legal Requirements. Except as set forth on Section 2.13 of the
Schedule of Exceptions, the Company and each of its Subsidiaries have paid all
material Taxes and other assessments due (whether or not shown on a Tax Return),
except those contested by it in good faith with respect to which (i) an adequate
reserve therefor has been established and is maintained in accordance with GAAP
and (ii) there has been no action to foreclose a lien on the Company’s or any
Subsidiary’s property as a result of such unpaid Taxes. There are no
Encumbrances on any of the assets of the Company or any of its Subsidiaries that
arose in connection with any failure (or alleged failure) to pay any Tax.
Neither the Company nor any Subsidiary has executed any waiver of any statute of
limitations on the assessment or collection of any Tax. None of the Company’s
federal or foreign income Tax Returns and none of its state income or franchise
tax or sales or use Tax Returns has ever been audited by any Governmental Body,
which audit has not been resolved. Since the Company’s inception, neither the
Company nor any Subsidiary has incurred any Taxes other than in the ordinary
course of business. The Company and each of its Subsidiaries have withheld or
collected from each payment made to each of its employees, the amount of all
material Taxes (including, but not limited to, federal income taxes, Federal
Insurance Contribution Act taxes and Federal Unemployment Tax Act taxes)
required to be withheld or collected therefrom, and has paid the same to the
proper Tax receiving officers or authorized depositories. To the Company’s
knowledge, no claim has been made by any Governmental Body in a jurisdiction
where the Company or any of its Subsidiaries does not file Tax Returns that the
Company or any of its Subsidiaries is or may be subject to taxation by that
jurisdiction. There is no dispute or claim concerning any Tax liability of the
Company or any of its Subsidiaries either (a) claimed or raised by any
Governmental Body in writing or (b) as to which the Company or any of its
Subsidiaries has knowledge.

 

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2.14          Insurance. Section 2.14 of the Schedule of Exceptions identifies
all insurance policies maintained by, at the expense of or for the benefit the
Company or any Subsidiary, identifies any material claims made thereunder, and
includes a summary of the amounts and types of coverage and the deductibles
under each such insurance policy. Each of the insurance policies identified in
Section 2.14 of the Schedule of Exceptions is in full force and effect. Except
as set forth in Section 2.14 of the Schedule of Exceptions, the Company has not
received any notice or other communication regarding any actual or possible (a)
cancellation or invalidation of any insurance policy, (b) refusal of any
coverage or rejection of any claim under any insurance policy, or (c) material
adjustment in the amount of the premiums payable with respect to any insurance
policy. With respect to each such insurance policy: (A) the policy is legal,
valid, binding, enforceable, and in full force and effect; (B) the policy will
continue to be legal, valid, binding, enforceable, and in full force and effect
on identical terms following the consummation of the Merger; (C) none of the
Company nor any of its Subsidiaries nor, to the Company’s knowledge, any other
party to the policy is in breach or default (including with respect to the
payment of premiums or the giving of notices), and, to the Company’s knowledge,
no event has occurred that, with notice or the lapse of time, would constitute
such a breach or default, or permit termination, modification, or acceleration,
under the policy; and (D) no party to the policy has repudiated any provision
thereof.

 

2.15          Employee Matters.

 

(a)               Section 2.15(a) of the Schedule of Exceptions sets forth all
employee benefit plans (within the meaning of Section 3(3) of ERISA) and any
other employee benefit plan, program or arrangement maintained, established or
sponsored by the Company or any Subsidiary, or in or to which the Company or any
of its Subsidiaries participates or contributes, or with respect to which the
Company or any of its Subsidiaries has any liability (each, a “Company Plan”).
The Company and its Subsidiaries have timely made all required contributions and
have no liability to any such employee benefit plan, other than liability for
health plan continuation coverage described in Part 6 of Title I(B) of ERISA
(“COBRA”), and have complied with all applicable laws for any such employee
benefit plan.

 

(b)               The Company, its Subsidiaries and each entity treated as a
single employer with the Company or any Subsidiary pursuant to Section 414 of
the Code (an “ERISA Affiliate”) do not participate in, contribute to, have any
obligation to contribute to, or have any liability or contingent liability with
respect to any multiemployer plan (as defined in Section 3(37) of ERISA)
(“Multiemployer Plan”) or any defined benefit plan (as defined in Section 3(35)
of ERISA). No Company Plan is or has ever been subject to Title IV of ERISA or
Section 412 of the Code. Except as set forth in Section 2.15(b) of the Schedule
of Exceptions, the Company and the Subsidiaries do not maintain, participate in,
contribute to, have any obligation to contribute to, or have any liability or
contingent liability with respect to any Company Plan which provides post
retirement health, accident or life insurance benefits to current or former
employees, current or former independent contractors, current or future
retirees, their spouses, dependents or beneficiaries, other than liability for
health plan continuation coverage under COBRA. The Company, its Subsidiaries and
each ERISA Affiliate have complied in all material respects with the
requirements of COBRA.

 

-19-

 

 

(c)                There are no pending or, to the knowledge of the Company,
threatened claims, actions or suits (other than routine claims for benefits) by,
on behalf of, or against any Company Plan or any trusts which are associated
with such Company Plans, or to the extent relating to any Company Plan, the plan
sponsor, the plan administrator or, to the knowledge of the Company, any
fiduciary of any Company Plan. None of the Company Plans are under audit or
investigation by the IRS, the Department of Labor, the Pension Benefit Guaranty
Corporation or any other Governmental Body.

 

(d)               With respect to each Company Plan, the Company has made
available to Parent true, correct and complete copies, to the extent applicable,
of (i) the plan and trust documents (including all amendments) and the most
recent summary plan description and any summary of material modifications, (ii)
the three (3) most recent annual reports (Form 5500 series, including all
schedules and attachments), (iii) the three (3) most recent financial statements
and actuarial reports, (iv) the most recent IRS determination, opinion, or
advisory letter, (v) any material associated administrative agreements or
insurance policies, (vi) all material correspondence with any Governmental Body
from the past three (3) years, with respect to which the Company has any ongoing
material obligation or liability, and (vii) all discrimination tests required
under the Code or ERISA for the three (3) most recent plan years.

 

(e)                Neither the Company nor any of its employees, nor, to the
Company’s knowledge, any other fiduciary of a Company Plan, has committed a
breach of any responsibility or obligation imposed upon fiduciaries under Title
I of ERISA with respect to such Company Plan. To the Company’s knowledge, no
event has occurred and no condition exists with respect to any Company Plan that
will subject Parent or any of its Affiliates, directly or indirectly (through
indemnification or otherwise), to any obligation or liability for (A) any breach
of any responsibility or obligation imposed upon fiduciaries under Title I of
ERISA, (B) any transaction in violation of Section 406 of ERISA or any
“prohibited transaction” (as defined in Section 4975(c)(1) of the Code), or (C)
any material tax, interest, penalty, liability, or fine under Section 502 of
ERISA or Section 4071 of the Code.

 

(f)                Each Company Plan which is a “nonqualified deferred
compensation plan” within the meaning of Section 409A of the Code was operated
and administered between January 1, 2005 and December 31, 2008 in compliance in
all material respects with a reasonable, good faith interpretation of Section
409A of the Code, and has been since January 1, 2009, in documentary and
operational compliance with Section 409A of the Code.

 

(g)               Each Company Plan that is intended to be qualified under
Section 401(a) of the Code and is the subject of a current favorable
determination, opinion, or advisory letter upon which Parent may rely. No fact
or event has occurred since the date of such letter from the IRS that would
reasonably be expected to adversely affect the qualified status of any such
Company Plan or the tax-exempt status of any such trust.

 

-20-

 

 

(h)               All Company Plans may be modified or terminated by the Company
without the consent of any other Person and without material liability to the
Company or any Subsidiary. The Company and its Subsidiaries have no obligation,
written or oral, to provide for any increase in any Company Plan.

 

(i)                 Section 2.15(i) of the Schedule of Exceptions lists, as of
the date hereof, each full-time and part-time employee of the Company and its
Subsidiaries, each consultant or independent contractor engaged by the Company
or any of its Subsidiaries and a detailed description of all compensation,
including salary, bonus, consulting fees, and deferred compensation paid or
payable for each such Person. None of such Persons are related to or otherwise
affiliated with any officer, director or Key Employee of the Company or any
Subsidiary.

 

(j)                 To the Company’s knowledge, none of its or any Subsidiary’s
employees is obligated under any contract (including licenses, covenants or
commitments of any nature) or other agreement, or subject to any judgment,
decree or order of any court or administrative agency, that would materially
interfere with such employee’s ability to promote the interest of the Company or
any of its Subsidiaries or that would conflict with the Company’s or any
subsidiary’s business. Neither the execution or delivery of any of the
Transaction Agreements, nor the carrying on of the Company’s or any Subsidiary’s
business by the employees of the Company or any of its Subsidiaries, nor the
conduct of the Company’s or any Subsidiary’s business as now conducted and as
presently proposed to be conducted, will, to the Company’s knowledge, conflict
with or result in a breach of the terms, conditions, or provisions of, or
constitute a default under, any contract, covenant or instrument under which any
such employee is now obligated.

 

(k)               Neither the Company nor any of its Subsidiaries is delinquent
in payments to any of its employees, consultants or independent contractors for
any wages, salaries, commissions, bonuses, or other direct compensation for any
service performed for it to the date hereof or amounts required to be reimbursed
to such employees, consultants, or independent contractors. The Company and its
Subsidiaries have complied with all applicable state and federal equal
employment opportunity laws and with other laws related to employment, including
those related to wages, hours, worker classification, collective bargaining, and
the payment and withholding of taxes and other sums as required by law except
where noncompliance with any applicable law has not resulted in, nor could be
reasonably expected to have, individually or in the aggregate, a Material
Adverse Effect.

 

(l)                 To the Company’s knowledge, no Key Employee intends to
terminate employment with the Company or any of its Subsidiaries or is otherwise
likely to become unavailable to continue as a Key Employee, nor does the Company
or any of its Subsidiaries have a present intention to terminate the employment
of any Key Employee. Except as set forth in Section 2.15(l) of the Schedule of
Exceptions, the employment of each employee of the Company or any of its
Subsidiaries is terminable at the will of the Company or Subsidiary. Except as
set forth in Section 2.15(l) of the Schedule of Exceptions or as required by
law, upon termination of the employment of any such employees, no severance or
other payments will become due. Except as set forth in Section 2.15(l) of the
Schedule of Exceptions, neither the Company nor any of its Subsidiaries has a
policy, practice, plan, or program of paying severance pay or any form of
severance compensation in connection with the termination of employment
services.

 

-21-

 

 

(m)             Except as set forth in Section 2.15(m) of the Schedule of
Exceptions, neither the Company nor any of its Subsidiaries have made any
representations regarding equity incentives to any officer, employees, director
or consultant that have not been duly approved by the board and evidenced by
duly executed stock option agreements, stock purchase agreements or the like.

 

(n)               Neither the Company nor any of its Subsidiaries is bound by or
subject to (and none of their respective assets or properties is bound by or
subject to) any written or oral, express or implied, contract, commitment or
arrangement with any labor union, and no labor union has requested or, to the
knowledge of the Company, has sought to represent any of the employees,
representatives or agents of the Company or any of its Subsidiaries. There is no
strike or other labor dispute involving the Company or any of its Subsidiaries
pending or threatened, nor is the Company aware of any labor organization
activity involving its employees.

 

(o)               Each current and former employee, consultant and officer of
the Company or any of its Subsidiaries has executed an agreement with the
Company regarding confidentiality, proprietary information, and invention
assignments and except as set forth in Section 2.15(o) of the Schedule of
Exceptions, to the Company’s knowledge, none of its employees, consultants or
officers is in violation thereof.

 

(p)               Except as set forth in Section 2.15(p) of the Schedule of
Exceptions, each former Key Employee whose employment was terminated by the
Company or any of its Subsidiaries has entered into an agreement with the
Company providing for the full release of any claims against the Company or any
related party arising out of such employment.

 

(q)               To the Company’s knowledge, none of the officers, directors or
Key Employees of the Company or any of its Subsidiaries has been (i) subject to
voluntary or involuntary petition under the federal bankruptcy laws or any state
insolvency law or the appointment of a receiver, fiscal agent or similar officer
by a court for his business or property, (ii) convicted in a criminal proceeding
or named as a subject of a pending criminal proceeding (excluding traffic
violations and other minor offenses), (iii) subject to any order, judgment, or
decree (not subsequently reversed, suspended, or vacated) of any court of
competent jurisdiction permanently or temporarily enjoining him from engaging,
or otherwise imposing limits or conditions on his engagement in any securities,
investment advisory, banking, insurance, or other type of business or acting as
an officer or director of a public company, or (iv) found by a court of
competent jurisdiction in a civil action or by the SEC to have violated any
federal or state securities or unfair trade practices law, which such judgment
or finding has not been subsequently reversed, suspended or vacated.

 

(r)                There is no agreement, plan, arrangement or other Contract
covering any employee or independent contractor or former employee or
independent contractor of the Company or any Subsidiary that, considered
individually or considered collectively with any other such Contracts, will, or
would reasonably be expected to, give rise directly or indirectly to the payment
of any amount that would not be deductible pursuant to Section 280G or
Section 162 of the Code. The Company shall not is, nor has ever been, a party to
or bound by any tax indemnity agreement, tax sharing agreement, tax allocation
agreement or similar agreement.

 

-22-

 

 

(s)                Since January 1, 2009: (i) neither the Company nor any of its
Subsidiaries has been party to or bound by any collective bargaining agreement,
labor contract, or other written or oral agreement or understanding with any
union or labor organization covering wages, hours, or terms or conditions of
employment; (ii) to the knowledge of the Company, (A) no union or labor
organization claims to represent any employee of the Company or its
Subsidiaries, and (B) there are no organizational campaigns, demands, petitions
or proceedings pending or threatened by any union, labor organization, or group
of employees seeking recognition or certification as collective bargaining
representative of any group of employees of the Company or its Subsidiaries;
(iii) neither the Company nor its Subsidiaries has experienced or been affected
by any labor strike, work stoppage, or lockout with respect to its labor force
and, to the knowledge of the Company, no labor strike, work stoppage or lockout
has been threatened against the Company; and (iv) other than as set forth in
Section 2.15(s) of the Schedule of Exceptions, there have been no disputes,
complaints, arbitration, lawsuits or administrative proceedings relating to
labor matters pending against the Company or any of its Subsidiaries, with
respect to which the Company or any Subsidiary has received written notice or,
to the knowledge of the Company, threatened against the Company or any
Subsidiary.

 

2.16          Related-Party Transactions.

 

(a)               Other than (i) standard employee benefits generally made
available to all employees, (ii) standard director and officer indemnification
agreements approved by the Board of Directors in such form previously provided
to Parent, (iii) the purchase of shares of the Company’s capital stock and the
issuance of Company Options, in each instance, approved by the Board of
Directors, and (iv) the transactions contemplated by the Transaction Agreements,
there are no agreements, understandings or proposed transactions between the
Company and any of its officers, directors, affiliates, or any affiliate
thereof.

 

(b)               No employee, officer or director of the Company or any of its
Subsidiaries (each, a “Related Party”) or member of such Related Party’s
immediate family, or any corporation, partnership or other entity in which such
Related Party is an officer, director or partner, or in which such Related Party
has an ownership interest or otherwise controls, is indebted to the Company or
any of its Subsidiaries, nor is the Company or any of its Subsidiaries indebted
(or committed to make loans or extend or guarantee credit) to any of them. None
of such Persons have any direct or indirect ownership interest in any firm or
corporation with which the Company or any of its Subsidiaries is affiliated or
with which the Company or any of its Subsidiaries has a business relationship,
or any firm or corporation that competes with the Company or any of its
Subsidiaries, except that Related Parties and members of their immediate
families may own stock in (but not exceeding 2% of the outstanding capital stock
of) publicly traded companies that may compete with the Company. No Related
Party or member of their immediate families is directly or indirectly interested
in any contract with the Company or any of its Subsidiaries. None of the Related
Parties, or any member of such Related Party’s immediate family, has any
material commercial, industrial, banking, consulting, legal, accounting,
charitable or familial relationship with any of the Company’s or any
Subsidiary’s major business relationship partners, service providers, joint
venture partners, licensees or competitors.

 

-23-

 

 

2.17          Permits. The Company and its Subsidiaries have all material
franchises, permits, licenses and any similar authority necessary for the
conduct of their respective businesses as currently conducted. Neither the
Company nor any of its Subsidiaries is in default in any material respect under
any of such franchises, permits, licenses or other similar authority. The
Company has the earth station license from the Federal Communications Commission
which is necessary to operate the Company’s in-flight broadband Internet access
system (the “Company System”). Armstrong Aerospace and/or the Company has the
requisite certifications from the Federal Aviation Administration and the
European Aviation Safety Agency that are required to deploy such vendor’s
products in the Company System on its in-service aircraft fleet.

 

2.18          Subsidiaries. Except as set forth in Section 2.18 of the Schedule
of Exceptions, the Company does not currently own or control, directly or
indirectly, any interest in any other corporation, partnership, trust, joint
venture, limited liability company, association or other business entity. The
Company is not a participant in any joint venture, partnership or similar
arrangement. The Company owns, directly or indirectly, all of the capital stock
or comparable equity interests of each of its Subsidiaries free and clear of any
and all liens or encumbrances, and all the issued and outstanding shares of
capital stock or comparable equity interest of each Subsidiary are validly
issued and are fully paid, non-assessable and free of preemptive and similar
rights to subscribe for or purchase securities.

 

2.19          Agreements; Actions.

 

(a)               Except for the Transaction Agreements and as otherwise set
forth in Schedule 2.19 of the Schedule of Exceptions, there are no agreements,
understandings, instruments, Contracts or proposed transactions to which the
Company or any of its Subsidiaries is a party or by which it is bound that
involve: (i) obligations (contingent or otherwise) of, or payments to, the
Company or any of its Subsidiaries in excess of $100,000; (ii) the license of
any patent, trademark, copyright, trade secret or other proprietary right to or
from the Company or any of its Subsidiaries (other than the license to the
Company or any of its Subsidiaries of generally commercially available
“off-the-shelf” third-party products); (iii) the grant of rights to manufacture,
produce, assemble, license, market or sell its products to any other Person or
affect the Company’s or any Subsidiary’s exclusive right to develop,
manufacture, assemble, distribute, market or sell its products; (iv) leases of
real property; (v) leases of material personal property; (vi) indemnification by
the Company or any of its Subsidiaries; (vii) agreements concerning a
partnership or joint venture; (viii) agreements under which it has created,
incurred, assumed, or guaranteed any indebtedness for borrowed money, or any
capitalized lease obligation, or under which it has imposed an Encumbrance on
any of its assets, tangible or intangible; (ix) agreements concerning
confidentiality or non-competition, other than such agreements with employees,
consultants and other third parties in the ordinary course of business; (x)
collective bargaining agreements; (xi) agreements for the employment of any
individual on a full-time, part-time, consulting, or other basis providing
annual compensation in excess of $100,000 or providing severance benefits
outside of the Company’s or any Subsidiary’s normal severance policies; (xii)
agreements pursuant to which the Company or any Subsidiary has exclusivity
rights with respect to any third party or such third party’s business or
operations; (xiii) agreements under which the consequences of default or
termination could be reasonably expected to have a Material Adverse Effect;
(xiv) settlement, conciliation or similar agreement with any Governmental Body
or which will require satisfaction of any obligations after the date hereof; or
(xv) are otherwise material to the Company’s or any Subsidiary’s current or
proposed business. To the extent any such Contract is oral, a summary of the
material terms of such arrangement is set forth in Section 2.19 of the Schedule
of Exceptions.

 

-24-

 

 

(b)               Each agreement, understanding, arrangement or other commitment
that is required to be set forth in Section 2.19 of the Schedule of Exceptions
(each, a “Material Contract”), is in full force and effect against the Company,
in each case in accordance with its terms. True, correct and complete copies of
all Material Contracts have previously been furnished to Parent. With respect to
each such Material Contract: (A) the Material Contract is the legal, valid,
binding and enforceable obligation of the Company, and is in full force and
effect; (B) the Material Contract will continue to be legal, valid, binding,
enforceable, and in full force and effect on identical terms following the
consummation of the Merger; (C) to the Company’s knowledge, no party is in
breach or default, and no event has occurred that with notice or lapse of time
would constitute a breach or default, or permit termination, modification, or
acceleration, under the Material Contract; and (D) no party has repudiated any
provision of the Material Contract.

 

(c)                Neither the Company nor any of its Subsidiaries has (i)
declared or paid any dividends, or authorized or made any distribution upon or
with respect to any class or series of its capital stock, (ii) except as set
forth in the Financial Statements, incurred any indebtedness for money borrowed
or incurred any other liabilities individually in excess of $150,000, or in
excess of $250,000 in the aggregate, (iii) made any loans or advances to any
Person, other than ordinary advances for travel expenses, or (iv) sold,
exchanged or otherwise disposed of (including any exclusive license of) any of
its assets or rights, other than the sale of its inventory in the ordinary
course of business.

 

(d)               For the purposes of subsections (a) and (c) above, all
indebtedness, liabilities, agreements, understandings, instruments, contracts
and proposed transactions involving the same Person (including Persons the
Company has reason to believe are affiliated with that Person) shall be
aggregated for the purposes of meeting the individual minimum dollar amounts of
each such subsection.

 

(e)                Other than discussions and negotiations relating to the
transactions contemplated by this Agreement, the Company has not engaged in the
past six (6) months in any discussion with any Person regarding (i) a sale or
exclusive license of all or substantially all of the Company’s assets, (ii) any
merger, consolidation or other business combination transaction of the Company
with or into another Person, or (iii) the direct or indirect acquisition
(including by way of a tender or exchange offer) by any Person, or Persons
acting as a group, of beneficial ownership or a right to acquire beneficial
ownership of shares representing a majority of the voting power of the then
outstanding shares of capital stock of the Company.

 

-25-

 

 

(f)                Neither the Company nor any Subsidiary is a guarantor or
indemnitor of any indebtedness of any other Person.

 

(g)               With respect to each Material Contract set forth in subsection
(ii) of Section 2.19 of the Schedule of Exceptions, Section 2.19(g) of the
Schedule of Exceptions sets forth, as of the date of this Agreement, the nature
and duration of the Company’s exclusivity rights with respect to any third party
or such third party’s business or operations.

 

2.20          Environmental and Safety Laws. Except as set forth in Section 2.20
of the Schedule of Exceptions, (a) the Company and its Subsidiaries are and have
been in compliance with all Environmental Laws, (b) there has been no release of
any Hazardous Substance on, upon, into or from any site currently or heretofore
owned, leased or otherwise used by the Company or any of its Subsidiaries,
(c) there have been no Hazardous Substances generated by the Company or any of
its Subsidiaries that have been disposed of or come to rest at any site that has
been included in any published U.S. federal, state or local “superfund” site
list or any other similar list of hazardous or toxic waste sites published by
any governmental authority in the United States, and (d) there are no
underground storage tanks located on, no polychlorinated biphenyls (“PCBs”) or
PCB-containing equipment used or stored on, and no hazardous waste as defined by
the Resource Conservation and Recovery Act, as amended, stored on, any site
owned or operated by the Company or any of its Subsidiaries, except for the
storage of hazardous waste in compliance with Environmental Laws.

 

2.21          Exclusive Rights. Neither the Company nor any of its Subsidiaries
has granted rights to manufacture, produce, assemble, lease, market or sell its
products or services to any other Person and is not bound by any agreement that
affects or limits the Company’s or any Subsidiary’s exclusive right to develop,
manufacture, distribute, market or sell its products and services. Neither the
Company nor any of its Subsidiaries is subject to any agreement or other
instrument which would restrict the ability of the Company or any of its
Subsidiaries to (a) engage in any business (including its current business) in
any manner or in any geographic area or (b) hiring or soliciting for hire any
Person.

 

2.22          Real Property Holding Company. The Company is not now and has
never been a “United States real property holding corporation” as defined in the
Code and any applicable regulations promulgated thereunder.

 

2.23          Records. The Company has delivered to Parent accurate and complete
copies of (a) the Charter Documents and (b) the minutes and other records of the
meetings and other proceedings (including any actions taken by written consent
or otherwise without a meeting) of the Company Stockholders and the stockholders
of the Subsidiary, the board of directors of the Company and all committees of
the board of directors of the Company.

 

2.24          Company Stockholder Approval. The written consent of (i) holders
of a majority of the outstanding shares of Company Capital Stock, voting
together as a single class and (ii) holders of a majority of the outstanding
shares of Company Preferred Stock, voting separately as a class, is required to
approve the principal terms of the Merger, adopt this Agreement and approve the
other Transaction Agreements (the “Company Stockholder Approval”). Other than
the Company Stockholder Approval, there are no other votes of the holders of any
class or series of the Company’s Capital Stock necessary with respect to such
matters.

 

-26-

 

 

2.25          Real Property. The Company does not own, have an option to
purchase, or have an obligation to purchase any real property. Section 2.25(a)
of the Schedule of Exceptions lists all real property leased by the Company or
its Subsidiaries (collectively, the “Leased Real Property”). Except as set forth
in Section 2.25(b) of the Schedule of Exceptions, neither the Company nor any
Subsidiary is in default under the terms of any lease to which it is a party in
respect of such Leased Real Property which default gives or would, with the
passage of time, give the lessor of such lease the right to terminate for
convenience or materially adversely alter the terms of such lease to which the
Company or any Subsidiary is a party. The Leased Real Property is in good order
and repair and is suitable for the conduct of the business of the Company or its
Subsidiary, as applicable.

 

2.26          Information Supplied. None of the information supplied or to be
supplied by the Company expressly for inclusion in the definitive Proxy
Statement (and any amendment or supplement thereto) will, at the date of mailing
and at the time of the Parent Stockholder Meeting, contain any statement which
is false or misleading with respect to any material fact, or which omits to
state any material fact necessary in order to make the statements therein not
false or misleading. None of the information supplied or to be supplied by the
Company expressly for inclusion in any of the filings made by Parent with the
SEC or with any stock exchange or other regulatory authority will, at the time
filed with the SEC, contain any untrue statement of a material fact or omit to
state any material fact required to be stated therein or necessary in order to
make the statements therein, in light of the circumstances under which they are
made, not misleading.

 

2.27          No Discussions. Other than discussions and negotiations relating
to the transactions contemplated by this Agreement, including with Parent,
neither the Company nor any Subsidiary is presently in discussion with any other
Person in connection with an Acquisition Transaction.

 

2.28          Accredited Investors. To the Company’s Knowledge, no more than an
aggregate of thirty-five (35) Company Stockholders are not “accredited
investors” within the meaning of Regulation D promulgated by the SEC under the
Securities Act.

  

  Section 3. Representations and Warranties of Parent and Merger Sub

  

Parent and Merger Sub jointly and severally represent and warrant to the Company
as follows:

 

3.1              Organization; Qualification. Each of Parent and Merger Sub is a
corporation duly incorporated, validly existing and, except as set forth in
Section 3.1 of the Parent Schedule of Exceptions, in good standing under the
laws of the State of Delaware, and has all corporate power required to conduct
its business as now conducted, and is duly qualified to do business and is in
good standing in each jurisdiction in which the conduct of its business or the
ownership or leasing of its properties requires such qualification, except where
the failure to be so qualified would not have a material adverse effect on
Parent’s business, financial condition or results of operations.

 

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3.2              Power; Authorization. Parent and Merger Sub have the requisite
corporate power and authority to enter into and to perform their obligations
under this Agreement and the other Transaction Agreements; and the execution,
delivery and performance by Parent and Merger Sub of this Agreement (including
the contemplated issuance of Parent Common Stock in the Merger in accordance
with this Agreement) and the Transaction Agreements have been duly authorized by
all necessary action on the part of Parent and Merger Sub and their respective
boards of directors. This Agreement and each of the Transaction Agreements
constitutes the legal, valid and binding obligation of Parent and Merger Sub,
enforceable against them in accordance with their respective terms, except as
the same may be limited by bankruptcy, insolvency, reorganization, fraudulent
conveyance, moratorium or other laws of general application relating to
bankruptcy, insolvency and the relief of debtors and the rules of law governing
specific performance, injunctive relief and other equitable remedies.

 

3.3              No Conflict; Consents. The execution and delivery of this
Agreement and the Transaction Agreements and the consummation of the
transactions contemplated hereby and thereby by Parent and Merger Sub are not
prohibited by, and will not violate or conflict with, any provision of the
certificate of incorporation or bylaws of Parent or Merger Sub, or of any Legal
Requirement or any order, writ, injunction or decree to which Parent or Merger
Sub is subject, or any provision of any Contract to which Parent or Merger Sub
is a party, except where any of the foregoing would not have, individually or in
the aggregate, a material adverse effect on the business, financial condition or
results of operations, of Parent. No Consent of any Governmental Body is
necessary on the part of Parent or Merger Sub for the consummation by Parent and
Merger Sub of the transactions contemplated by this Agreement.

 

3.4              Valid Issuance. All shares of Parent Common Stock to be issued
in the Merger will when issued in accordance with the provisions of this
Agreement, be validly issued, fully paid and nonassessable and free of
preemptive rights.

 

3.5              Capitalization. As of the Execution Date, the authorized and
outstanding capital stock of Parent consists, and as of the Closing Date the
authorized and outstanding capital stock of Parent will consist, of:

 

(a)               400,000,000 shares of Parent Common Stock, of which 23,161,585
shares are issued and outstanding. All of the outstanding shares of Common Stock
have been duly authorized, are fully paid and nonassessable and were issued in
compliance with all applicable federal and state securities laws.

 

(b)               1,000,000 shares of preferred stock, par value $0.0001 per
share, none of which is issued and outstanding.

 

(c)                Parent Warrants to purchase an aggregate of 25,992,500 shares
of Parent Common Stock. All of the Parent Warrants have been duly authorized,
are fully paid and nonassessable and were issued in compliance with all
applicable federal and state securities laws.

 

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(d)               On or prior to the Closing, all of the Total Merger Shares (i)
will be issued or have been issued in compliance with all applicable federal,
state and foreign securities laws and other Legal Requirements and (ii) will not
be issued in violation of or subject to any preemptive rights or other rights to
subscribe for or purchase securities of the Company.

 

(e)                Parent has never declared, accrued, set aside or paid any
dividend or made any other distribution in respect of any shares of its capital
stock, nor has the Company redeemed, repurchased or otherwise reacquired any
shares of its capital stock or other security other than repurchases at the
lower of cost or the current fair market value thereof from former employees in
accordance with the terms of such employees’ purchase agreements.

 

(f)                Parent has no stock plan, stock purchase agreement, stock
option agreement, employment agreement or other Contract between Parent and any
holder of any equity securities or rights to purchase equity securities provides
for acceleration or other changes in the vesting provisions, Parent’s repurchase
rights or other terms of such Contract as the result of: (i) termination of
employment (whether actual or constructive); (ii) any Acquisition Transaction;
or (iii) the occurrence of any other event or combination of events.

 

(g)               No issued and outstanding shares of any of the capital stock
of Parent are held by Parent in its treasury or by any Subsidiaries of Parent.

 

(h)               Aside from the Parent Warrants, there are no options,
warrants, convertible securities or other rights, agreements, arrangements or
commitments of any character obligating Parent to issue or sell any additional
shares of the capital stock of, or other equity interest in, Parent.

 

3.6              Merger Sub. Merger Sub has been formed solely for the purpose
of executing and delivering this Agreement and consummating the transactions
contemplated hereby. Merger Sub has not engaged in any business or activity
other than activities related to its corporate organization and the execution
and delivery of this Agreement.

 

3.7              SEC Filings; Financial Statements. Parent has filed with the
SEC and has heretofore made available to the Company true and complete copies of
all forms, reports, schedules, statements and other documents required to be
filed by it and its Subsidiaries under the Exchange Act (collectively, the
“Parent SEC Documents”). As of their respective dates or, if amended, as of the
date of the last such amendment, the Parent SEC Documents, including, without
limitation, any financial statements or schedules included therein, complied in
all material respects with the applicable requirements of the Securities Act and
the Exchange Act, and did not contain any untrue statement of a material fact or
omit to state a material fact required to be stated therein or necessary in
order to make the statements therein, in light of the circumstances under which
they were made, not misleading. Each of the balance sheets (including the
related notes) included in the Parent SEC Documents fairly presented in all
material respects the financial position of Parent as of the respective dates
thereof, and the other related financial statements (including the related
notes) included therein fairly presented in all material respects the results of
operations and cash flows of Parent for the respective periods or as of the
respective dates set forth therein. Each of the balance sheets and statements of
operations and cash flows (including the related notes) included in the Parent
SEC Documents has been prepared in all material respects in accordance with
GAAP, except as otherwise noted therein and subject, in the case of unaudited
interim financial statements, to normal year-end adjustments.

 

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3.8              Taxes. Parent has duly and timely filed all material Tax
Returns and reports (including information returns and reports) as required by
law. All such Tax Returns were correct and complete in all material respects and
were prepared in substantial compliance with all applicable Legal Requirements.
Except as set forth in Section 3.8 of the Parent Schedule of Exceptions, Parent
has paid all material Taxes and other assessments due (whether or not shown on a
Tax Return), except those contested by it in good faith with respect to which
(i) an adequate reserve therefor has been established and is maintained in
accordance with GAAP and (ii) there has been no action to foreclose a lien on
Parent’s property as a result of such unpaid Taxes. There are no Encumbrances on
any of the assets of Parent that arose in connection with any failure (or
alleged failure) to pay any Tax. Parent has not executed any waiver of any
statute of limitations on the assessment or collection of any Tax. None of the
Company’s federal or foreign income Tax Returns and none of its state income or
franchise tax or sales or use Tax Returns has ever been audited by any
Governmental Body, which audit has not been resolved. Since the Company’s
inception, neither the Company nor any Subsidiary has incurred any Taxes other
than in the ordinary course of business. Parent has withheld or collected from
each payment made to each of its employees, the amount of all material Taxes
(including, but not limited to, federal income taxes, Federal Insurance
Contribution Act taxes and Federal Unemployment Tax Act taxes) required to be
withheld or collected therefrom, and has paid the same to the proper Tax
receiving officers or authorized depositories. To Parent’s knowledge, no claim
has been made by any Governmental Body in a jurisdiction where Parent does not
file Tax Returns that Parent is or may be subject to taxation by that
jurisdiction. There is no dispute or claim concerning any Tax liability of the
Parent either (a) claimed or raised by any Governmental Body in writing or (b)
as to which the Parent has knowledge.

 

3.9              No Discussions. Other than discussions and negotiations
relating to the transactions contemplated by this Agreement, including with AIA
and PAR with respect to the AIA Transaction Agreements, Parent is not actively
pursuing with any other Person (each, a “Target”) (a) a sale or exclusive
license of all or substantially all of any Target’s assets to Parent or any of
its subsidiaries or affiliates, (ii) any merger, consolidation or other business
combination transaction with respect to any Target, or (iii) the direct or
indirect acquisition (including by way of a tender or exchange offer) by Parent
or any of its subsidiaries or affiliates of beneficial ownership or a right to
acquire beneficial ownership of shares representing a majority of the voting
power of the then outstanding shares of capital stock of any Target.

 

3.10          Parent Vote Required. The vote of such holders of shares of Parent
Common Stock as set forth in the Proxy Statement is required to approve the
Parent Voting Matters (collectively, the “Required Parent Vote”). Other than the
Required Parent Vote, there are no other votes of the holders of Parent Common
Stock or of any other class or series of the capital stock of Parent necessary
with respect to such matters.

 

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3.11          Trust Account. As of the date of this Agreement, Parent has at
least $189,643,330.90 of funds held in the trust account established for the
benefit of the public stockholders of Parent (the “Trust Account”), such monies
being invested in United States Government securities or money market funds
meeting certain conditions under Rule 2a-7 promulgated under the Investment
Company Act of 1940, as amended, and held in trust pursuant to that certain
Investment Management Trust Agreement by and between Parent and American Stock
Transfer & Trust Company, LLC (the “Trustee”) dated as of May 12, 2011 (the
“Trust Agreement”). The Trust Agreement is valid and in full force and effect
and enforceable in accordance with its terms and has not been amended or
modified. There are no separate agreements, side letters or other agreements or
understandings (whether written or unwritten, express or implied) that would
cause the description of the Trust Agreement in the Parent SEC Documents to be
inaccurate in any material respect and/or that would entitle any Person (other
than as set forth in this Section 3.11) to any portion of the proceeds in the
Trust Account. Prior to the Closing, none of the funds held in the Trust Account
may be released except (x) to pay income and franchise taxes and expenses from
any interest income earned in the Trust Account and (y) to purchase up to the
Maximum Redemption Amount of Parent Common Stock sold in Parent’s initial public
offering at a price per share no greater than the Parent Share Price. Following
the Closing and notice thereof to the Trustee, the Trustee shall be obligated to
release as promptly as practicable all funds held in the Trust Account to
Parent, and, thereafter, the Trust Account shall terminate; provided that Parent
shall pay each of the following liabilities and obligations as and when due: (i)
on the Closing, all amounts payable to Parent Stockholders who have exercised
their rights to cause the Parent to redeem their shares of Parent Common Stock
for cash pursuant to Parent’s certificate of incorporation (provided that in no
event may the aggregate number of shares of Parent Common Stock redeemed by
Parent prior to the Closing in accordance with clause (y) of the preceding
sentence and any shares of Parent Common Stock redeemed by Parent pursuant to
this clause (i) exceed the Maximum Redemption Amount), (ii) all amounts payable
to the underwriters in Parent’s initial public offering and other designated
Persons, in an amount not to exceed $6,647,375 in the aggregate to all such
underwriters and other designated Persons, representing deferred underwriting
commissions and discounts payable upon consummation of the Closing and certain
advisory fees, (iii) fees with respect to filings, applications and/or other
actions taken pursuant to this Agreement required under the HSR Act, (iv)
amounts payable to Global Eagle Acquisition LLC or its members or affiliates as
may relate to (A) unpaid loans made to Parent and unreimbursed, documented
out-of-pocket expenses incurred on behalf of Parent in connection with the
business and operations of Parent, (B) unpaid amounts owed to Roscomare Ltd. for
office space, secretarial and administrative services pursuant to the Letter
Agreement, dated as of February 2, 2011, between Roscomare Ltd. and Parent, and
(C) unpaid amounts owed to James A. Graf for consulting services pursuant to the
Consulting Agreement, dated as of May 12, 2011, (v) all fees, costs and expenses
(including legal fees, accounting fees, printer fees, and other professional
fees) that have been incurred or that are incurred by Parent, Merger Sub, the
Company, AIA, or PAR in connection with the transactions contemplated by this
Agreement and the AIA Transaction Agreements and (vi) unpaid franchise and
income taxes of Parent, provided, further, that, after payment of all the
aforementioned liabilities and obligations from the Trust Account, the remaining
monies in the Trust Account shall, as a result of the Merger, become an asset of
Parent at and after the Effective Time. As of the Effective Time, those
obligations of Parent to dissolve or liquidate within a specified time period as
contained in Parent’s certificate of incorporation will be terminated and Parent
shall have no obligation whatsoever to dissolve and liquidate the assets of
Parent by reason of the consummation of the transactions contemplated by this
Agreement and the AIA Transaction Agreements, and no Parent Stockholder shall be
entitled to receive any amount from the Trust Account.

 

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3.12          Brokers or Finders. Except as set forth in Section 3.12 of the
Parent Schedule of Exceptions, no broker, finder or investment banker is
entitled to any brokerage, finder’s or other fee or commission in connection
with the Merger or any of the other transactions contemplated by this Agreement
based upon arrangements made by or on behalf of Parent.

  

  Section 4. Certain Covenants of the Company and Par

  

4.1              Access and Investigation. During the period from the date of
this Agreement through the Closing Date or the earlier termination of this
Agreement (the “Pre-Closing Period”), the Company shall, and shall cause its
Representatives to provide Parent and Parent’s Representatives with: (a) full
access to its personnel, premises, properties and assets and to all existing
books, records, Tax Returns, work papers and other documents and information
relating to the Company; (b) copies of such existing books, records, Tax
Returns, work papers and other documents and information relating to the
Company; and (c) such additional financial, operating and other data and
information regarding the Company as Parent may reasonably request.

 

4.2              Company Operations. Without the prior written consent of
Parent, during the Pre-Closing Period:

 

(a)               the Company and its Subsidiaries shall conduct its business
and operations in the ordinary course and in substantially the same manner as
such business and operations have been conducted prior to the date of this
Agreement;

 

(b)               the Company shall use reasonable best efforts to preserve
intact its current business organization, keep available the services of its
current officers and employees and maintain its relations and good will with all
suppliers, customers, landlords, creditors, employees and other Persons having
business relationships with it;

 

(c)                the Company shall keep in full force all insurance policies
identified in Section 2.14 of the Schedule of Exceptions;

 

(d)               neither the Company nor any Subsidiary shall make any binding
material proposal or enter into, amend or terminate any Material Contract
(including, without limitation, any lease of real property);

 

(e)                the Company shall not declare, accrue, set aside or pay any
dividend or make any other distribution in respect of any shares of Company
Capital Stock, and the Company shall not repurchase, redeem or otherwise
reacquire any shares of Company Capital Stock or other securities;

 

(f)                the Company shall not sell, issue or authorize the issuance
of (i) any capital stock or other security (except upon the valid exercise of
Company Options or Company Warrants outstanding as of the date of this Agreement
or upon conversion of any shares of Company Preferred Stock into shares of
Company Common Stock and except with respect to the issuance of additional
options prior to the Closing Date to the officers and employees of the Company
under the 2011 Equity Incentive Plan), (ii) any option or right to acquire any
capital stock or other security, or (iii) any instrument convertible into or
exchangeable for any capital stock or other security;

 

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(g)               the Company shall not amend or waive any of its rights under
(i) any provision of 2011 Equity Incentive Plan, (ii) any provision of any
agreement evidencing any outstanding option or right to purchase equity
securities of the Company, or (iii) any provision or any restricted stock
purchase agreement;

 

(h)               neither the Company nor any Subsidiary shall amend or permit
the adoption of any amendment to any of the Charter Documents;

 

(i)                 neither Company nor any Subsidiary shall form any subsidiary
or acquire any equity interest or other interest in any other Entity;

 

(j)                 neither the Company nor any Subsidiary shall (i) enter into,
or permit any of the assets owned or used by it to become bound by, any Contract
requiring the Consent of any other party to such Contract in connection with the
Merger or the other transactions contemplated by this Agreement, (ii) enter
into, or permit any of the assets owned or used by it to become bound by, any
Contract that is or would constitute a Material Contract, or (iii) amend or
prematurely terminate, or waive any material right or remedy under, any Material
Contract;

 

(k)               neither the Company nor any Subsidiary shall (i) lend money to
any Person (except that the Company may make routine travel advances to
employees in the ordinary course of business) or (ii) incur or guarantee any
indebtedness for borrowed money;

 

(l)                 neither the Company nor any Subsidiary shall (i) establish,
adopt or amend any employee benefit plan, (ii) pay any bonus or make any
profit-sharing payment, cash incentive payment or similar payment to, or
increase the amount of the wages, salary, commissions, fringe benefits or other
compensation or remuneration payable to, any of its directors, officers or
employees, or (iii) hire any new employee, consultant or independent contractor;

 

(m)             the Company shall not change any of its methods of accounting or
accounting practices in any material respect;

 

(n)               neither the Company nor any Subsidiary shall make any material
Tax election;

 

(o)               neither the Company nor any Subsidiary shall commence or
settle any Legal Proceeding;

 

(p)               neither the Company nor any Subsidiary shall take any other
action, or enter into any transaction of the sort, set forth in Section 2.12
above; and

 

(q)               neither the Company nor any Subsidiary shall agree or commit
to take any of the actions described in clauses “(d)” through “(p)” above;
provided that, notwithstanding anything contained in this Section 4.2 to the
contrary, after the Execution Date the Company shall not be restricted from
acquiring the Repurchased Shares or issuing the Company Recap Notes or the
Backstop Note.

 

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4.3              Notification; Updates to Schedule of Exceptions.

 

(a)               During the Pre-Closing Period, the Company shall promptly
notify Parent in writing of:

 

(i)                 the discovery by the Company of any event, condition, fact
or circumstance that occurred or existed on or prior to the date of this
Agreement and that caused or constitutes an inaccuracy in or breach of any
representation or warranty made by the Company in this Agreement;

 

(ii)               any event, condition, fact or circumstance that occurs,
arises or exists after the date of this Agreement and that would cause or
constitute an inaccuracy in or breach of any representation or warranty made by
the Company in this Agreement if (A) such representation or warranty had been
made as of the time of the occurrence, existence or discovery of such event,
condition, fact or circumstance or (B) such event, condition, fact or
circumstance had occurred, arisen or existed on or prior to the date of this
Agreement;

 

(iii)             any breach of any covenant or obligation of the Company; and

 

(iv)             any event, condition, fact or circumstance that would make the
timely satisfaction of any of the conditions set forth in Section 7 or Section 8
impossible or unlikely.

 

(b)               If any event, condition, fact or circumstance that is required
to be disclosed pursuant to Section 4.3(a) requires any change in the Schedule
of Exceptions, or if any such event, condition, fact or circumstance would
require such a change assuming the Schedule of Exceptions were dated as of the
date of the occurrence, existence or discovery of such event, condition, fact or
circumstance, then the Company shall promptly deliver to Parent an update to the
Schedule of Exceptions specifying such change. No such update shall be deemed to
supplement or amend the Schedule of Exceptions for the purpose of
(i) determining the accuracy of any of the representations and warranties made
by the Company in this Agreement, for purposes of the indemnification provisions
set forth in Section 10 or otherwise, or (ii) determining whether any of the
conditions set forth in Section 8 has been satisfied.

 

4.4              No Negotiations. During the Pre-Closing Period, none of the
Company, PAR nor any of their respective Representatives shall, directly or
indirectly:

 

(a)               solicit or encourage the initiation of any inquiry, proposal
or offer from any Person (other than Parent) relating to a possible Acquisition
Transaction;

 

(b)               participate in any discussions or negotiations or enter into
any agreement with, or provide any information to, any Person (other than
Parent) relating to or in connection with a possible Acquisition Transaction; or

 

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(c)                consider, entertain or accept any proposal or offer from any
Person (other than Parent) relating to a possible Acquisition Transaction.

 

The Company shall promptly notify Parent in writing of any inquiry, proposal or
offer relating to a possible Acquisition Transaction that is received by the
Company, PAR or any Representative thereof during the Pre-Closing Period.

 

4.5              Public Announcements. From and after the date of this
Agreement, the Company shall not (i) issue any press release regarding this
Agreement or the Merger, or regarding any of the other transactions contemplated
by this Agreement or (ii) make any public statement regarding this Agreement or
the Merger, or regarding any of the other transactions contemplated by this
Agreement, in each case without Parent’s prior written consent. The Company
shall not provide any written materials (including by email) to its employees
generally (or to any subset thereof), or to its customers or partners generally
(or to any subset thereof), regarding this Agreement or the Merger, or regarding
any of the other transactions contemplated by this Agreement without Parent’s
prior written consent; provided, that the Company may provide written materials
to the Company Stockholders in such form approved by Parent in accordance with
Sections 4.9(a) and (b).

 

4.6              Trust Account Waiver. Each of the Company and PAR acknowledges
and agrees that Parent is a blank check company with the power and privileges to
effect a merger, asset acquisition, reorganization or similar business
combination involving the Company and one or more businesses or assets. Each of
the Company and PAR acknowledges and agrees that Parent’s sole assets consist of
the cash proceeds of Parent’s initial public offering and private placements of
its securities, and that substantially all of these proceeds have been deposited
in the Trust Account for the benefit of its public shareholders. For and in
consideration of Parent and Merger Sub entering into this Agreement, the receipt
and sufficiency of which are hereby acknowledged, each of the Company and PAR,
on behalf of itself and any of their respective managers, directors, officers,
affiliates, members, stockholders, trustees, hereby irrevocably waive any right,
title, interest or claim of any kind they have or may have in the future in or
to any monies in the Trust Account, and agree not to seek recourse against the
Trust Account or any funds distributed therefrom as a result of, or arising out
of, any such claims against Parent or Merger Sub arising under this Agreement.

 

4.7              Notices and Consents. The Company and its Subsidiaries shall
give any notices to third parties referred to in Section 2.3 of the Schedule of
Exceptions, and shall use their reasonable best efforts to obtain any
third-party Consents set forth in Section 2.3 of the Schedule of Exceptions.

 

4.8              Company Stockholder Approval.

 

(a)               On the Execution Date, the Board shall submit this Agreement
for adoption by the Company Stockholders by written consent and recommend that
the Company Stockholders adopt this Agreement, and shall include in such
submissions sent to Non-Accredited Company Stockholders a copy of the draft
preliminary Proxy Statement. The Company shall use its reasonable best efforts
to obtain the Company Stockholder Approval within three (3) business days
following the Execution Date in compliance with applicable Legal Requirements.

 

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(b)               After the Company Stockholder Approval has been obtained, the
Company shall send, pursuant to Sections 228 and 262(d) of the DGCL, a written
notice to all Company Stockholders that did not execute the written consent
under which the Company Stockholder Approval was obtained, informing them that
this Agreement was adopted and that appraisal rights are available for their
Company Capital Stock pursuant to Section 262 of the DGCL (which notice shall
include a copy of such Section 262).

 

4.9              Certain Company Covenants Related to Proxy Statement and
Additional Parent Filings. The Company acknowledges that a substantial portion
of the Proxy Statement and certain other forms, reports and other filings
required to be made by Parent under the Exchange Act in connection with the
transactions contemplated hereby (including, without limitation, a current
report on Form 8-K required to be filed after the Closing regarding these
transactions sometimes referred to as a “Super 8-K”) (collectively, “Additional
Parent Filings”) shall include disclosure regarding the Company and its
management, operations and financial condition. Accordingly, the Company agrees
to promptly provide Parent with all information concerning the Company, its
management, operations and financial condition, in each case, required to be
included in the Proxy Statement and Additional Parent Filings or as otherwise
requested by Parent. The Company and its Subsidiaries shall make their managers,
directors, officers and employees available to Parent and its counsel in
connection with the drafting of the Proxy Statement and responding in a timely
manner to comments on the Proxy Statement from the SEC.

 

4.10          Company Penny Warrants. The Company shall use its reasonable best
efforts to cause the holders of Company Penny Warrants to exercise each such
Company Penny Warrant prior to or at Closing.

 

4.11          2011 Equity Incentive Plan. The Company shall take all actions
necessary to terminate the 2011 Equity Incentive Plan as of the Effective Time.

 

  Section 5. Certain Covenants of Parent

  

5.1              Proxy Statement. As promptly as practicable after the execution
of this Agreement, Parent shall file with the SEC a proxy statement in
connection with the transactions contemplated by this Agreement (the “Proxy
Statement”) for delivery to Parent Stockholders, which Proxy Statement shall
comply as to form in all material respects with the applicable requirements of
the Exchange Act, the DGCL and NASDAQ rules. In that regard, Parent shall set a
record date (the “Parent Record Date”) for determining the Parent Stockholders
entitled to attend a meeting of the Parent Stockholders to vote on the Parent
Voting Matters (the “Parent Stockholder Meeting”). Parent shall cause a copy of
the Proxy Statement to be delivered to each Parent Stockholder who was a
Stockholder as of the Parent Record Date and, as promptly as practicable
thereafter, Parent shall use commercially reasonable efforts to hold the Parent
Stockholder Meeting and to solicit from each Parent Stockholder a proxy or vote
in favor of proposals to approve (i) the principal terms of the Merger and the
adoption of this Agreement, (ii) the principal terms of the AIA Acquisition and
the adoption of the AIA Acquisition Agreement and (iii) the authorization and
adoption of the Parent 2012 Equity Incentive Plan and iv) the other proposals
submitted to the vote of the Parent Stockholders in the Proxy Statement
(collectively, the “Parent Voting Matters”).

 

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5.2              Parent Operations. Without the prior written consent of the
Company, during the Pre-Closing Period:

 

(a)               Parent shall conduct its business and operations in the
ordinary course and in substantially the same manner as such business and
operations have been conducted prior to the date of this Agreement;

 

(b)               Parent shall not declare, accrue, set aside or pay any
dividend or make any other distribution in respect of any shares of its capital
stock, and Parent shall not shall repurchase, redeem or otherwise reacquire any
shares of its capital stock or other securities;

 

(c)                except as otherwise contemplated by this Agreement and by the
AIA Transaction Agreement, Parent shall not shall sell, issue or authorize the
issuance of (i) any capital stock or other security, (ii) any option or right to
acquire any capital stock or other security, or (iii) any instrument convertible
into or exchangeable for any capital stock or other security, in each case other
than entry into agreements for issuances and sales of shares of Parent Common
Stock (or securities convertible into or exchangeable for shares of Parent
Common Stock) at the Closing for a purchase price per share greater than or
equal to the Parent Share Price;

 

(d)               Parent shall not shall amend or permit the adoption of any
amendment to any of its charter documents;

 

(e)                Parent shall not shall enter into, or permit any of the
assets owned or used by it to become bound by, any Contract requiring the
Consent of any other party to such Contract in connection with (i) the Merger or
the other transactions contemplated by this Agreement or (ii) the AIA
Transaction Agreements;

 

(f)                Parent shall not shall (i) lend money to any Person (except
that Parent may make routine travel advances to employees in the ordinary course
of business) or (ii) incur or guarantee any indebtedness for borrowed money in
excess of $1 million;

 

(g)               Parent shall not shall change any of its methods of accounting
or accounting practices in any material respect; or

 

(h)               Parent shall not shall agree or commit to take any of the
actions described in clauses ”(b)” through “(g)” above.

 

5.3              Public Announcements. From and after the date of this
Agreement, except to the extent required by the Securities Act and the Exchange
Act, Parent shall not (i) issue any press release regarding this Agreement or
the Merger, or regarding any of the other transactions contemplated by this
Agreement or (ii) make any public statement regarding this Agreement or the
Merger, or regarding any of the other transactions contemplated by this
Agreement, in each case without the Company’s prior written consent.

 

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5.4              No Other Transactions. During the Pre-Closing Period, neither
Parent nor any of its Representatives shall, directly or indirectly:

 

(a)               Commence, initiate or renew any discussion, proposal or offer
to any Target;

 

(b)               Commence or renew any due diligence investigation of any
Target;

 

(c)                participate in any discussions or negotiations or enter into
any term sheet, memorandum of understanding or other Contract with, any Target;
or

 

(d)               consider, entertain or present any proposal or offer to any
Target relating to a possible Acquisition Transaction.

 

5.5              Indemnification Agreements. Prior to the Closing, Parent shall
enter into an indemnification agreement with each of the individuals who will be
directors of Parent immediately following the Closing, each in such form
reasonably satisfactory to Parent and the Company.

 

5.6              Post-Closing Covenants of Parent. Parent hereby agrees and
covenants as to the following, from and after the Closing:

 

(a)               All rights to indemnification for acts or omissions occurring
through the Closing existing as of the date hereof in favor of the current
directors and officers of the Company as provided in the Charter Documents or in
any indemnification agreements between the Company and any of its directors or
officers (all of which, for purposes of clarification, are set forth in Section
2.19 of the Schedule of Exceptions) shall survive the Merger and shall continue
in full force and effect in accordance with their respective terms.

 

(b)               For a period of six (6) years after the Closing, Parent shall
cause to be maintained by the Surviving Corporation the current policies of
directors’ and officers’ liability insurance maintained by the Company as of the
Closing (or policies of at least the same coverage and amounts containing terms
and conditions which are no less advantageous) with respect to claims arising
from facts and events that occurred prior to the Closing; provided, however,
that in no event shall Parent or Surviving Corporation be required to expend
under this Section 5.6(b) more than an amount equal to 200% of the current
annual premiums paid by the Company for such insurance.

 

(c)                If Parent or the Surviving Corporation or any of their
successors or assigns (i) consolidates with or merges into any other Person and
shall not be the continuing or surviving entity of such consolidation or merger,
or (ii) transfers or conveys all or substantially all of its properties and
assets to any Person, then, in each such case, to the extent necessary, proper
provision shall be made so that the successors and assigns of Parent or the
Surviving Corporation, as the case may be, assume the obligations set forth in
this Section 5.6.

 

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  Section 6. Covenants of Company and Parent.

  

6.1              Cooperation. Each of the Company and Parent will its reasonable
best efforts to take all actions and to do all things necessary, proper, or
advisable in order to consummate and make effective the transactions
contemplated by this Agreement (including satisfaction, but not waiver, of the
Closing conditions set forth in Sections 7 and 8). Without limiting the
foregoing, the Company shall, and shall cause its Subsidiaries and each of their
respective officers, employees and non-employee representatives to, use
reasonable efforts to provide to Parent such customary cooperation reasonably
requested by Parent in connection with the solicitation of proxies for the
Parent Stockholder Meeting and/or the holding or purchase of shares of Parent
Common Stock, in each case related to the transactions contemplated hereby,
including, without limitation, attending and participating in such
presentations, meetings and roadshows reasonably requested by Parent and
providing such information, financial or otherwise, reasonably requested by
Parent in connection therewith.

 

6.2              HSR Act. Each of the Company and Parent will file any
Notification and Report Forms and related material that it may be required to
file with the Federal Trade Commission and the Antitrust Division of the United
States Department of Justice under the HSR Act in connection with the
transactions contemplated hereby, will use its reasonable best efforts to obtain
an early termination of the applicable waiting period, and will make any further
filings pursuant thereto that may be necessary, proper, or advisable.

 

6.3              Updates to Proxy Statement. If at any time prior to the
Effective Time, any information relating to Parent, the Company or its
Subsidiaries, or any of their respective subsidiaries, affiliates, officers or
directors, that should be set forth in an amendment or supplement to the Proxy
Statement should be discovered by Parent or the Company, as applicable, the
party which discovers such information shall promptly notify the other party
hereto and an appropriate amendment or supplement describing such information
shall be promptly filed with the SEC and, to the extent required by law,
disseminated to the stockholders of Parent; provided, however, that no
information received by the Company or Parent pursuant to this Section 6.3 shall
operate as a waiver or otherwise affect any representation, warranty or
agreement given or made by the other party, and no such information shall be
deemed to change, supplement or amend the Schedules of Exceptions or Parent
Schedule of Exceptions, as the case may be.

 

  Section 7. Conditions Precedent to Obligations of Parent and Merger Sub

  

The obligations of Parent and Merger Sub to effect the Merger and otherwise
consummate the transactions contemplated by this Agreement are subject to the
satisfaction (or waiver by Parent), at or prior to the Closing, of each of the
following conditions:

 

7.1              Accuracy of the Company’s Representations.

 

(a)               All of the Company’s representations and warranties in this
Agreement that contain “Material Adverse Effect” or other “materiality” or
similar qualifiers shall have been accurate in all respects as of the date of
this Agreement and as of the Closing Date as if made on and as of the Closing
Date.

 

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(b)               All of the Company’s representations and warranties in this
Agreement that do not contain “Material Adverse Effect” or other “materiality”
or similar qualifiers shall have been accurate in all material respects as of
the date of this Agreement and as of the Closing Date as if made on and as of
the Closing Date.

 

7.2              Performance of Covenants. All of the covenants and obligations
that the Company or any of its Subsidiaries is required to comply with or to
perform at or prior to the Closing shall have been complied with and performed
in all material respects.

 

7.3              Parent Stockholder Approval. The Required Parent Vote shall
have been obtained.

 

7.4              Required Consents. All third party Consents required to be
obtained in connection with the Merger and the other transactions contemplated
by this Agreement set forth in Section 7.5 of the Schedule of Exceptions shall
have been obtained by the Company and shall be in full force and effect.

 

7.5              Agreements and Documents. Parent shall have received the
following agreements and documents, each of which shall be in full force and
effect:

 

(a)               the Registration Rights Agreement, executed by PAR;

 

(b)               the Escrow Agreement, executed by the Stockholders’ Agent and
the Escrow Agent;

 

(c)                the Certificate of Merger, executed by the Company, to be
filed with the Secretary of State of the State of Delaware in accordance with
Section 1.3;

 

(d)               a certificate executed by the Chief Executive Officer of the
Company containing the representation of such Chief Executive Officer on behalf
of the Company that the conditions set forth in Sections 7.1, 7.2, 7.6 and 7.13
have been duly satisfied;

 

(e)                a statement in accordance with Treasury Regulation Sections
1.1445-2(c)(3) and 1.897-2(h) certifying that the Company is not, and has not
been, a “United States real property holding corporation” for purposes of
Sections 897 and 1445 of the Code, duly executed by the Company;

 

(f)                a certificate of the Secretary of the Company, certifying to
(i) the incumbency and specimen signature of each officer of the Company
executing this Agreement and any other document executed on behalf of the
Company, (ii) the organizational documents of the Company, (iii) the resolutions
of the Board of Directors of the Company approving and adopting this Agreement,
the Transaction Agreements and the transactions contemplated hereby and thereby,
which shall not have been modified, revoked or rescinded as of the Closing, and
(iv) Company Stockholder Approval, which shall not have been modified, revoked
or rescinded as of the Closing;

 

(g)               a certificate of good standing with respect to the Company and
each of its Subsidiaries, dated not more than five (5) days prior to the Closing
Date, from the state of Delaware and all states listed with respect to such
Entity in Section 2.1 of the Schedule of Exceptions;

 

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(h)               written resignations of all directors of the Company and of
each Subsidiary, effective as of the Closing Date;

 

(i)                 executive employment agreements between the Company and each
of the Company Executives, each in form acceptable to Parent (collectively, the
“Employment Agreements”); and

 

(j)                 a waiver executed and delivered by each “disqualified
person” within the meaning of Section 280G of the Code entitled to any Excess
Payments, pursuant to which each such Person has agreed to waive any right or
entitlement to any Excess Payments unless any requisite stockholder approval of
those payments and benefits are obtained, together with an approval of such
Excess Payments by the stockholders of the Company in a manner satisfying all
applicable requirements of Section 280G(b)(5)(B) of the Code and the Treasury
Regulations thereunder, in each case in form and substance reasonably
satisfactory to Parent.

 

7.6              Absence of Material Adverse Effect. There shall not have
occurred any Material Adverse Effect on the Company, and no event shall have
occurred or circumstance shall exist that, in combination with any other events
or circumstances, would reasonably be expected to have, individually or in the
aggregate, a Material Adverse Effect on the Company.

 

7.7              Backstop Agreement. The Backstop Agreement shall remain in full
force and effect, and PAR shall have complied in all material respects with its
obligations under the Backstop Agreement.

 

7.8              AIA Transactions. The transactions contemplated by the AIA
Transaction Agreements shall be consummated.

 

7.9              HSR Act. All waiting periods applicable to the Merger and the
other transactions contemplated by this Agreement and the Transaction Agreements
under the HSR Act shall have expired or been terminated.

 

7.10          No Restraints. No temporary restraining order, preliminary or
permanent injunction or other order preventing the consummation of the Merger
shall have been issued by any court of competent jurisdiction and remain in
effect, and there shall not be any Legal Requirement enacted or deemed
applicable to the Merger that makes consummation of the Merger illegal or
otherwise preventing or prohibiting consummation of the transactions
contemplated hereby.

 

7.11          No Legal Proceedings; Bankruptcy. No Governmental Body or other
Person shall have commenced or threatened to commence any Legal Proceeding (a)
challenging or seeking the recovery of a material amount of damages in
connection with the Merger or (b) seeking to prohibit or limit the exercise by
Parent of any material right pertaining to its ownership of stock of Merger Sub
or the Company.

 

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7.12          Appraisal Rights. Company Stockholders holding no more than 5.0%
of the outstanding shares of Company Capital Stock on a fully-diluted basis
shall have exercised or otherwise perfected their rights of appraisal pursuant
to applicable law with respect to such shares.

 

7.13          Company Stockholder Approval. The Company Stockholder Approval
shall have been obtained.

  

  Section 8. Conditions Precedent to Obligations of the Company

  

The obligations of the Company to effect the Merger and otherwise consummate the
transactions contemplated by this Agreement are subject to the satisfaction (or
waiver by the Company), at or prior to the Closing, of the following conditions:

 

8.1              Accuracy of Representations.

 

(a)               All of Parent’s and Merger Sub’s representations and
warranties in this Agreement that contain “material adverse effect” or other
“materiality” or similar qualifications shall have been accurate in all respects
as of the date of this Agreement and as of the Closing Date as if made on and as
of the Closing Date.

 

(b)               All of Parent’s and Merger Sub’s representations and
warranties in this Agreement that do not contain “material adverse effect” or
other “materiality” or similar qualifiers shall have been accurate in all
material respects as of the date of this Agreement and as of the Closing Date as
if made on and as of the Closing Date.

 

8.2              Performance of Covenants. All of the covenants and obligations
that Parent and Merger Sub are required to comply with or to perform at or prior
to the Closing shall have been complied with and performed in all material
respects.

 

8.3              Share Redemptions. Parent shall not have redeemed or otherwise
be obligated to redeem Parent Shares in an amount that is greater than the
Maximum Redemption Amount.

 

8.4              Parent Stockholder Approval. The Required Parent Vote shall
have been obtained.

 

8.5              Agreements and Documents. The Company shall have received the
following documents each of which shall be in full force and effect:

 

(a)               the Registration Rights Agreement executed by Parent and
Parent’s Sponsor;

 

(b)               the Escrow Agreement executed by Parent and the Escrow Agent;

 

(c)                a certificate executed by an officer of Parent containing the
representation of such officer that the conditions set forth in Sections 8.1,
8.2, and 8.4 have been duly satisfied;

 

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(d)               a certificate of the Secretary of each of Parent and Merger
Sub, certifying to (i) the incumbency and specimen signature of each officer of
Parent or Merger Sub, as applicable, executing this Agreement and any other
document executed on behalf of Parent or Merger Sub, as applicable, (ii) the
organizational documents of Parent or Merger Sub, as applicable, (iii) the
resolutions of the Board of Directors of Parent and Merger Sub, as applicable,
approving and adopting this Agreement, the Transaction Agreements to which such
Entity is a party and the transactions contemplated hereby and thereby, which
shall not have been modified, revoked or rescinded as of the Closing, and (iv)
the Required Parent Vote, which shall not have been modified, revoked or
rescinded as of the Closing; and

 

(e)                a certificate of good standing with respect to Merger Sub,
dated not more than five (5) days prior to the Closing Date, from the state of
Delaware.

 

8.6              AIA Transactions. The transactions contemplated by the AIA
Transaction Agreements shall be consummated.

 

8.7              HSR Act. All waiting periods applicable to the Merger and the
other transactions contemplated by this Agreement and the Transaction Agreements
under the HSR Act shall have expired or been terminated.

 

8.8              No Restraints. No temporary restraining order, preliminary or
permanent injunction or other order preventing the consummation of the Merger
shall have been issued by any court of competent jurisdiction and remain in
effect, and there shall not be any Legal Requirement enacted or deemed
applicable to the Merger that makes consummation of the Merger illegal or
otherwise preventing or prohibiting consummation of the transactions
contemplated hereby.

 

8.9              No Legal Proceedings; Bankruptcy. No Governmental Body or other
Person shall have commenced or threatened to commence any Legal Proceeding (a)
challenging or seeking the recovery of a material amount of damages in
connection with the Merger or (b) seeking to prohibit or limit the exercise by
Parent of any material right pertaining to its ownership of stock of Merger Sub
or the Company.

 

8.10          Trust Account. Parent shall have made appropriate arrangements to
have all Trust Account funds disbursed to Parent as promptly as practicable
following the Closing, and the amount of such funds, assuming, solely for the
purposes of this condition, that Parent shall not have redeemed, nor have any
obligation to redeem, any shares of Parent Common Stock in connection with the
transactions hereby, shall be no less than $169,643,330.90.

 

8.11          Company Stockholder Approval. The Company Stockholder Approval
shall have been obtained.

 

8.12          Restated Parent Organizational Documents. The certificate of
incorporation of Parent shall be amended and restated in the form attached
hereto as Exhibit H, and the bylaws of Parent shall be amended and restated in
the form attached hereto as Exhibit I.

 

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  Section 9. Termination

  

9.1              Termination Events. This Agreement may be terminated at any
time prior to the Effective Time (whether before or after the Company
Stockholder Approval or Required Parent Vote has been obtained):

 

(a)               by mutual written consent of Parent and the Company;

 

(b)               by either Parent or the Company if the Merger shall not have
been consummated by February 18, 2013 (the “Outside Date”) (unless the failure
to consummate the Merger is attributable to a failure on the part of the party
seeking to terminate this Agreement to perform any material obligation required
to be performed by such party at or prior to the Effective Time);

 

(c)                by either Parent or the Company if a court of competent
jurisdiction or other Governmental Body shall have issued a final and
nonappealable order, decree or ruling, or shall have taken any other action,
having the effect of permanently restraining, enjoining or otherwise prohibiting
the Merger;

 

(d)               by Parent if the Parent Stockholders shall have taken a final
vote on the principal terms of the Merger and the adoption of this Agreement,
and the Required Parent Vote has not been received;

 

(e)                by Parent if any of the Company’s representations and
warranties contained in this Agreement shall have been inaccurate in any
material respect as of the date of this Agreement or shall have become
inaccurate in any material respect as of any subsequent date (as if made on such
subsequent date), or if any of the Company’s covenants contained in this
Agreement shall have been breached in any material respect; provided, however,
that Parent may not terminate this Agreement under this Section 9.1(e) on
account of an inaccuracy in the Company’s representations and warranties or on
account of a breach of a covenant by the Company unless such inaccuracy or
breach (if curable) is not cured by the Company within ten (10) calendar days
after receiving written notice from Parent of such inaccuracy or breach;

 

(f)                by the Company if any of Parent’s or Merger Sub’s
representations and warranties contained in this Agreement shall have been
inaccurate in any material respect as of the date of this Agreement or shall
have become inaccurate in any material respect as of any subsequent date (as if
made on such subsequent date), or if any of Parent’s or Merger Sub’s covenants
contained in this Agreement shall have been breached in any material respect;
provided, however, that the Company may not terminate this Agreement under this
Section 9.1(f) on account of an inaccuracy in Parent’s or Merger Sub’s
representations and warranties or on account of a breach of a covenant by Parent
or Merger Sub (ii) unless such inaccuracy or breach (if curable) is not cured by
Parent within 15 calendar days after receiving written notice from the Company
of such inaccuracy or breach;

 

(g)               by Parent if the Company has breached Section 4.4;

 

(h)               by the Company if Parent has breached Section 5.4.; or

 

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(i)                 by either Parent or the Company if the Company has not
delivered the Company Stockholder Approval within three (3) business days
following the Execution Date.

 

9.2              Termination Procedures. If Parent wishes to terminate this
Agreement pursuant to Sections 9.1(b), 9.1(c), 8.1(d), 9.1(e), 9.1(g) or
(9.1)(i), then Parent shall deliver to the Company a written notice stating that
Parent is terminating this Agreement and setting forth a brief description of
the basis on which Parent is terminating this Agreement. If the Company wishes
to terminate this Agreement pursuant to Sections 9.1(b), 9.1(c), 9.1(f), 9.1(h)
or 9.1(i), then the Company shall deliver to Parent a written notice stating
that the Company is terminating this Agreement and setting forth a brief
description of the basis on which it is terminating this Agreement.

 

9.3              Fees Payable by the Company. If this Agreement is terminated by
Parent pursuant to Section 9.1(g) then, concurrently with the consummation of an
Alternative Transaction by the Company on or prior to the Outside Date, the
Company shall pay to Parent the Termination Payment by wire transfer of
immediately available funds to a bank account designated by Parent.

 

9.4              Fees Payable by Parent. If this Agreement is terminated by the
Company pursuant to Section 9.1(h) then, concurrently with the execution of a
term sheet, memorandum of understanding or Agreement with a Target on or prior
to the Outside Date, Parent shall pay the Termination Payment to the Company by
wire transfer of immediately available funds to a bank account designated
thereby.

 

9.5              Effect of Termination. If this Agreement is terminated pursuant
to Sections 9.1 or 9.2, all further obligations of the parties under this
Agreement, other than with respect to payment of the Termination Payment under
either Section 9.3 or 9.4, shall terminate without any liability of any party
hereto or any of their respective affiliates or their respective directors,
officers, stockholders, members, managers, partners, employees, agents or
representatives, provided, that (a) none of the parties shall be relieved of any
obligation or liability arising from any prior willful breach by such party of
any provision of this Agreement, and (b) the parties shall, in all events,
remain bound by and continue to be subject to the provisions set forth in
Section 11.

 

  Section 10. Indemnification, Etc.

  

10.1          Survival of Representations, Etc.

 

(a)               Subject to Section 10.1(b), the representations and warranties
of the Company, Parent and Merger Sub contained in this Agreement shall survive
the Closing and shall expire on the eighteen (18) month anniversary of the
Closing Date (the “Expiration Date”), provided, however, that if, at any time
prior to the Expiration Date, any Parent Indemnified Party (acting in good
faith) delivers to the Stockholders’ Agent, or Stockholders’ Agent (acting in
good faith) delivers to Parent, a written notice alleging the existence of an
inaccuracy in or a breach of any of the representations or warranties of the
Company, Parent or Merger Sub (and setting forth in reasonable detail the basis
for such Indemnified Party’s belief that such an inaccuracy or breach may exist)
and asserting a claim for recovery under Section 10.2 or Section 10.6 based on
such alleged inaccuracy or breach, then the claim asserted in such notice shall
survive the Expiration Date until such time as such claim is fully and finally
resolved.

 

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(b)               The limitations set forth in Section 10.1(a) shall not apply
in the case of claims based upon fraud or willful misconduct.

 

(c)                The covenants and other agreements by each of the parties
contained in this Agreement shall survive the consummation of the Merger until
they are otherwise terminated, whether by their terms or as a matter of
applicable law.

 

10.2          Indemnification.

 

(a)               From and after the Closing Date, the Merger Stockholders,
severally but not jointly, shall hold harmless and indemnify each of each of
Parent, Merger Sub and their Affiliates, and each of their respective officers,
directors, employees, agents and representatives (each, a “Parent Indemnified
Party,” and, collectively, the “Parent Indemnified Parties”) from and against,
and shall compensate and reimburse each of the Parent Indemnified Parties for,
any Damages that are directly or indirectly suffered or incurred by any of the
Parent Indemnified Parties or to which any of the Parent Indemnified Parties may
otherwise become subject (regardless of whether or not such Damages relate to
any third-party claim) that arise from or as a result of, or are directly or
indirectly connected with: (i) any inaccuracy in or breach of any representation
or warranty made by the Company in this Agreement or the Schedule of Exceptions
as of the date of this Agreement, (ii) any inaccuracy in or breach of any
representation or warranty set forth (A) in Section 2 or the Schedule of
Exceptions as if such representation and warranty had been made on and as of the
Closing Date, or (B) in any other document, certificate or other instrument
delivered to Parent or Merger Sub in connection with the transactions
contemplated hereby, (iii) any breach of any covenant or obligation of the
Company set forth in this Agreement (including the covenants set forth in
Sections 4 and 6) or the Transaction Agreements, (iv) the exercise by any
Company Stockholder of rights of appraisal or dissent under Section 262 of the
DGCL or any other applicable law, (v) any Indebtedness to the extent not
included in the calculation of the adjustments to the Total Merger Shares set
forth in Section 1.14(b), and (vi) any claim, objection or dispute by any
Company Stockholder with respect to or arising from the Spreadsheet.

 

(b)               From and after the Closing Date, Parent shall hold harmless
and indemnify the Merger Stockholders and their Affiliates, and each of their
respective officers, directors, employees, agents and representatives (each, a
“Company Indemnified Party,” and, collectively, the “Company Indemnified
Parties”), from and against all Damages that are directly suffered or incurred
by any of the Company Indemnified Parties or to which any of the Company
Indemnified Parties may otherwise be subject (regardless of whether or not such
Damages relate to any third-party claim) that arise from or as a result of, or
are directly or indirectly connected with: (i) any inaccuracy in or breach of
any representation or warranty made by Parent or Merger Sub contained in this
Agreement or the Parent Schedule or Exceptions as of the date of this Agreement,
(ii) any inaccuracy in or breach of any representation or warranty set forth (A)
in Section 3 or the Parent Schedule of Exceptions as if such representation and
warranty had been made on and as of the Closing Date, or (B) in any other
document, certificate or other instrument delivered by Parent or Merger Sub to
the Company in connection with the transactions contemplated hereby, and (iii)
any breach of any covenant or obligation of Parent or Merger Sub contained in
this Agreement (including the covenants set forth in Sections 5 and 6) or the
Transaction Agreements.

 

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(c)                Limitations.

 

(i)                 The Parent Indemnified Parties shall not be entitled to any
payment of any amount under Section 10.2(a) after such time as the aggregate of
all Damages that the Parent Indemnified Parties may have under Section 10.2(a)
exceed the value of the Escrow Shares, valued at the Parent Share Price (such
amount, the “Cap”).

 

(ii)               The Parent Indemnified Parties shall not be entitled to any
payment of any amount under Section 10.2(a)(i) or (ii) (other than for breaches
of Fundamental Representations) until such time as the total amount of all such
Damages that have been directly or indirectly suffered or incurred by any one or
more of the Parent Indemnified Parties, or to which any one or more of the
Parent Indemnified Parties has or have otherwise become subject, exceeds, in the
aggregate, the Threshold Amount, in which event the Parent Indemnified Parties
shall be entitled to all such Damages, including the Threshold Amount. For
purposes of this Agreement, the “Threshold Amount” means $2.5 million.

 

(iii)             The Company Indemnified Parties shall not be entitled to any
payment of any amount under Section 10.2(b) after such time as the aggregate of
all Damages that the Company Indemnified Parties may have under Section 10.2(b)
exceed the Cap.

 

(iv)             The Company Indemnified Parties shall not be entitled to any
payment of any amount under Section 10.2(b)(i) or (ii) (other than for breaches
of Fundamental Representations) until such time as the total amount of all such
Damages that have been directly or indirectly suffered or incurred by any one or
more of the Company Indemnified Parties, or to which any one or more of the
Company Indemnified Parties has or have otherwise become subject, exceeds, in
the aggregate, the Threshold Amount, in which event the Company Indemnified
Parties shall be entitled to all such Damages, including the Threshold Amount.

 

(d)               The limitations set forth in Section 10.2(c) shall not apply
in the case of claims based upon fraud or willful misconduct, in which case the
maximum liability of each Merger Stockholder to the Parent Indemnified Parties
shall be limited to the value of 100% of the Merger Consideration, valued using
the Parent Share Price, such Merger Stockholder has received pursuant to the
provisions of Section 1.5 (the “Aggregate Overall Cap”), and the maximum
liability of Parent to the Company Indemnified Parties shall be limited to the
Aggregate Overall Cap.

 

(e)                Each Indemnified Party will take and will cause their
respective Affiliates to take all reasonable steps to mitigate and otherwise
minimize any Damage to the maximum extent reasonably possible upon and after
becoming aware of any event which would reasonably be expected to give rise to
any Damage.

 

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(f)                Notwithstanding anything to the contrary contained in this
Section 10 (but in any case subject to Section 10.3), except with respect to
claims of fraud or willful misconduct, the Parent Indemnified Parties’ sole and
exclusive source of indemnification under this Section 10 shall be the Escrow
Account by making a claim pursuant to the terms of the Escrow Agreement. In
addition, subject to Section 10.3, Parent Indemnified Parties may not pursue an
indemnification claim under this Section 10 for fraud or willful misconduct
against any Merger Stockholder individually, unless and only to the extent that
all of the proceeds of the Escrow Account have been released or are the subject
of a previous claim by a Parent Indemnified Party.

 

10.3          Exclusivity of Indemnification Remedies. With the exception of (a)
claims based upon fraud or willful misconduct and subject to Section 10.2(d) and
(b) claims for breach of any Letter of Transmittal or Option Holder Letter of
Transmittal (which such claim may be made solely against the breaching Merger
Stockholder or holder of Company Options, as the case may be), the right of any
Parent Indemnified Party to assert claims for indemnification and to receive
indemnification pursuant to this Section 10 shall, after the Closing, be such
Person’s sole and exclusive remedy for monetary Damages with respect to any
breach of the representations, warranties and covenants contained in this
Agreement. The exercise by any Person of any of its rights under this Section 10
shall not be deemed to be an election of remedies and shall not be deemed to
prejudice, or to constitute or operate as a waiver of, any injunctive or other
equitable right, remedy or relief that such Person may be entitled to exercise.

 

10.4          No Contribution. Upon consummation of the Merger, each Merger
Stockholder will be deemed to have waived any right of contribution, right of
indemnity or other right or remedy against Merger Sub, the Company and each of
its Subsidiaries in connection with any indemnification obligation or any other
liability to which he, she or it may become subject under or in connection with
this Agreement.

 

10.5          Defense of Third Party Claims.

 

(a)               In order for a Parent Indemnified Party or a Company
Indemnified Party (each, an “Indemnified Party”) to be entitled to any
indemnification provided for under this Agreement in respect of, arising out of
or involving any Damages or demand made by any person against the Indemnified
Party (a “Third Party Claim”), such Indemnified Party shall deliver notice
thereof to the Stockholders’ Agent, or to Parent, as applicable (the
“Indemnifying Party”); provided, that no delay or failure on the part of an
Indemnified Party in notifying the Stockholders’ Agent or Parent, as the case
may be, shall relieve an Indemnifying Party from its obligations hereunder
unless the Indemnifying Party is thereby materially prejudiced (and then solely
to the extent of such prejudice).

 

(b)               The Indemnifying Party shall have the right, upon written
notice to the Indemnified Party within fifteen (15) days of receipt of notice
from the Indemnified Party of the commencement of such Third Party Claim, to
assume the defense thereof at the expense of the Indemnifying Party with counsel
selected by the Indemnifying Party and reasonably satisfactory to the
Indemnified Party. If the Indemnifying Party does not expressly elect to assume
the defense of such Third Party Claim within the time period set forth in this
Section 10.5(b), the Indemnified Party shall have the sole right to assume the
defense of and to settle such Third Party Claim. If the Indemnifying Party
assumes the defense of any Third Party Claim, the Indemnified Party shall, at
the Indemnifying Party’s expense, cooperate with the Indemnifying Party in such
defense and make available to the Indemnifying Party 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 assumes the defense of any
Third Party Claim, the Indemnifying Party shall not, without the prior written
consent of the Indemnified Party (not to be unreasonably withheld, conditioned
or delayed), enter into any settlement or compromise or consent to the entry of
any judgment with respect to such Third Party Claim if such settlement,
compromise or judgment (i) involves a finding or admission of wrongdoing, (ii)
does not include an unconditional written release by the claimant or plaintiff
of the Indemnified Party from all liability in respect of such Third Party Claim
or (iii) imposes equitable remedies or any obligation on the Indemnified Party
other than solely the payment of money damages for which the Indemnified Party
will be indemnified hereunder.

 

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10.6          Claims Relating to Securities. If (a) prior to the Effective Time,
any Person asserts or commences, or threatens to assert or commence, a claim or
Legal Proceeding on the basis that such Person is entitled to acquire or
receive, or is the owner of, shares of Company Capital Stock or securities
convertible into shares of Company Capital Stock, and (b) notwithstanding such
claim or Legal Proceeding the Closing occurs, then (i) the shares or other
securities that are the basis of such claim or Legal Proceeding shall be deemed
to be outstanding for purposes of determining the Share Exchange Ratio; (ii)
Parent shall not be required to issue or deliver any shares of Parent Common
Stock in respect of such claim or Legal Proceeding (or the shares or other
securities forming the basis of such claim or Legal Proceeding) until such claim
or Legal Proceeding is finally resolved or settled, which settlement shall not
be entered into without the prior written consent of the Stockholders’ Agent
(which consent shall not be unreasonably withheld); and (iii) after such claim
or Legal Proceeding is finally resolved, any shares of Parent Common Stock being
held by Parent in respect of such claim or Legal Proceeding that are not
delivered to the Person making such claim or Legal Proceeding or otherwise
retained by Parent in accordance with this Section 10.6 shall be distributed to
the Merger Stockholders and the Escrow Agent as if such shares were issuable at
the Closing in accordance with Section 1. If a claim or Legal Proceeding of the
type referred to in this Section 10.6 is settled by the payment of cash, Parent
shall be entitled to retain pursuant to this Section 10.6, a number of shares of
Parent Common Stock determined by dividing (A) the sum of (1) the amount of cash
payable to the Person who asserted such claim or Legal Proceeding in respect of
the settlement of such claim or Legal Proceeding and (2) the amount of any legal
fees and other expenses incurred by Parent or its Subsidiary in connection with
such claim or Legal Proceeding, by (B) the Parent Stock Price.

 

10.7          Security Interest in Escrow.

 

(a)               As collateral security for the prompt and complete payment and
performance when due of each of the Merger Stockholders’ indemnification,
reimbursement and compensation obligations to each Parent Indemnified Party
pursuant to this Section 10, and in order to induce Parent to enter into this
Agreement, each Merger Stockholder hereby grants to Parent a security interest
in all of the Merger Stockholder’s right, title and interest in and to the
Escrow Shares and the Escrow Account (as defined in the Escrow Agreement) and
all accessions to, substitutions and replacements for, and proceeds thereof. At
any time and from time to time, upon the written request of Parent, and at the
sole expense of the Merger Stockholders, the Company shall promptly and duly
execute and deliver any and all such further instruments and documents and take
such further action as Parent may reasonably deem desirable to obtain the full
benefits of the security interest granted hereby, including, (a) executing,
delivering and causing to be filed any financing or continuation statements
(including “in lieu” continuation statements) under the applicable Uniform
Commercial Code with respect to the security interests granted hereby, and (b)
executing and delivering and causing the Escrow Agent, or any other applicable
depository institution, securities intermediary or commodity intermediary, to
execute and deliver a collateral control agreement in order to perfect the
security interest created hereunder in favor of Parent (including giving Parent
“control” over such Collateral within the meaning of the applicable provisions
of Article 8 and Article 9 of the UCC). Each Company Stockholder also hereby
authorizes Parent to file any such financing or continuation statement
(including “in lieu” continuation statements) without the signature of such
Merger Stockholder.

 

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(b)               So long as no Parent Indemnified Party has given a Claim
Notice (as defined in the Escrow Agreement) containing a Claim (as defined in
the Escrow Agreement) which has not been resolved prior to the Termination Date
(as defined in the Escrow Agreement), then upon the Termination Date the
security interest granted under this Section 10.7 shall terminate and Parent
shall release all of its interest in and to the Escrow Shares and the Escrow
Account. In the event such a Claim has not been resolved prior to the
Termination Date, the security interest granted under this Section 10.7 shall
continue until such time as the Claim is resolved in accordance with the Escrow
Agreement, at which time the security interest granted under this Section 10.7
shall terminate and Parent shall release all of its interest in and to the
Escrow Shares and the Escrow Account. Upon such termination of the security
interest granted under this Section 10.7, Parent shall execute such terminations
of any financing statements or other documents required to evidence such
termination of the security interest.

 

10.8          Release of Escrow Shares to Satisfy Indemnification Claims.
Subject to the terms of the Escrow Agreement, in the event that any Parent
Indemnified Party is entitled to indemnification pursuant to this Section 10,
the Parent Indemnified Party may, upon written notice to the Stockholders’
Agent, direct the Escrow Agent to release and transfer to Parent the number of
Escrow Shares having an aggregate value on the date thereof equal to the amount
owed to the Parent Indemnified Party pursuant to this Section 10 in satisfaction
of such claim. For purposes hereof, the value of each Escrow Share shall be
equal to the Parent Share Price.

 

10.9          Materiality. Notwithstanding anything contained herein to the
contrary, for purposes of determining the amount of Damages that are the subject
matter of a claim for indemnification or reimbursement hereunder, each
representation and warranty in this Agreement, the Schedule of Exceptions, the
Parent Schedule of Exceptions and exhibits hereto shall be read without regard
and without giving effect to the term “material,” “Material Adverse Effect” or
similar phrases contained in such representation and warranty (i.e., as if such
words or phrases were deleted from such representation and warranty.

 

10.10      Effect of Investigation. The right to indemnification, payment of
Damages of a Parent Indemnified Party or other remedies of Parent or any other
Parent Indemnified Party based on any representation, warranty, covenant or
obligation of the Company contained in or made pursuant to this Agreement, in
the Schedule of Exceptions or exhibits hereto shall not be affected or deemed
waived by any investigation conducted with respect to, or any knowledge acquired
(or capable of being acquired) at any time, with respect to the accuracy or
inaccuracy of or compliance with, any such representation, warranty, covenant or
obligation.

 

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  Section 11. Miscellaneous Provisions

 

11.1          Stockholders’ Agent.

 

(a)               By virtue of the approval of this Agreement and the Merger,
the Stockholders will appoint PAR as the Stockholders’ Agent for purposes of
Sections 1.14(b) and 10 to give and receive notices and communications, to
execute and deliver the Escrow Agreement, to authorize delivery to Parent
Indemnified Party of Parent Common Stock, cash or other property under the
Escrow Agreement, to agree to, negotiate, enter into settlements and compromises
of indemnification, reimbursement or compensation claims, and to take all other
actions necessary or appropriate to act on behalf of the Stockholders under this
Agreement. PAR hereby accepts its appointment as the Stockholders’ Agent. Parent
shall be entitled to deal exclusively with the Stockholders’ Agent on all
matters relating to Sections 1.14(b) and 10, and shall be entitled to rely
conclusively (without further evidence of any kind whatsoever) on any document
executed or purported to be executed on behalf of any Stockholder by the
Stockholders’ Agent, and on any other action taken or purported to be taken on
behalf of any Stockholder by the Stockholders’ Agent, as fully binding upon such
Stockholder. Notices or communications to or from the Stockholders’ Agent shall
constitute notice to or from each of the Stockholders.

 

(b)               The Stockholders’ Agent shall not be liable for any act done
or omitted hereunder as the Stockholders’ Agent while acting in good faith and
in the exercise of reasonable judgment. The Merger Stockholders shall, jointly
and severally, indemnify the Stockholders’ Agent and hold the Stockholders’
Agent harmless against any loss, liability or expense incurred without gross
negligence, bad faith or willful misconduct on the part of the Stockholders’
Agent and arising out of or in connection with the acceptance or administration
of the Stockholders’ Agent’s duties hereunder, including the reasonable fees and
expenses of any legal counsel or other professional retained by the
Stockholders’ Agent.

 

(c)                All actions, decisions and instructions of the Stockholders’
Agent taken, made or given pursuant to the authority granted pursuant to this
Section 11.1 shall be final, conclusive and binding upon each Stockholder, and
no Stockholder shall have the right to object, dissent, protest or otherwise
contest the same.

 

(d)               The provisions of this Section 11.1 are independent and
severable, shall constitute an irrevocable power of attorney, coupled with an
interest and surviving death or dissolutions, granted by the Stockholders to the
Stockholders’ Agent and shall be binding upon the executors, heirs, legal
representatives, successors and assigns of each such Stockholder.

 

11.2          Further Assurances. Each party hereto shall execute and cause to
be delivered to each other party hereto 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 contemplated by this Agreement.

 

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11.3          Fees and Expenses. Following the Closing and upon release of the
Parent Trust Account, Parent shall bear and pay all fees, costs and expenses
(including legal fees and accounting fees) that have been incurred or that are
incurred by Parent, the Company and PAR in connection with the transactions
contemplated by this Agreement, including, without limitation, all fees, costs
and expenses incurred by Parent, the Company and PAR in connection with or by
virtue of (a) the investigation and review conducted each such Person and its
Representatives with respect to the Company’s business (and the furnishing of
information to Parent and its Representatives in connection with such
investigation and review), (b) the negotiation, preparation and review of this
Agreement (including the Schedule of Exceptions and the Parent Schedule of
Exceptions) and all agreements, certificates, opinion and other instruments and
documents delivered or to be delivered in connection with the transactions
contemplated by this Agreement, (c) the preparation and submission of any filing
or notice required to be made of given in connection with any of the
transactions contemplated by this Agreement, and (d) the consummation of the
Merger.

 

11.4          Attorneys’ Fees. If any action or proceeding relating to this
Agreement or the enforcement of any provision of this Agreement is brought
against any party hereto, 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).

 

11.5          Notices. Any notice or other communication required or permitted
to be delivered to any party under this Agreement shall be in writing and shall
be deemed properly delivered, given and received (a) when delivered by hand, or
(b) two business days after such notice is sent by registered mail, by courier
or express delivery service or by facsimile, in each case to the address or
facsimile telephone number set forth beneath the name of such party below (or to
such other address or facsimile telephone number as such party shall have
specified in a written notice given to the other parties hereto):

 

if to Parent or Merger Sub:

 

Global Eagle Acquisition Corp.
10900 Wilshire Blvd., Suite 1500
Los Angeles, CA 90024
Attention: Chief Executive Officer
Facsimile: (310) 209-7225

 

with a copy to:

 

McDermott Will & Emery LLP
340 Madison Avenue
New York, NY 10173-1922
Attention: Joel Rubinstein, Esq.
Facsimile: 212-547-5444

 

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if to the Company:

 

Row 44, Inc.
4353 Park Terrance Drive, Suite 100
Westlake Village, CA 91361
Attention: General Counsel
Facsimile: 818-706-9431

 

with a copy to:

 

Strategic Law Partners, LLP
500 South Grand Avenue, Suite 2050
Los Angeles, CA 90071
Attention: Timothy F. Silvestre, Esq.

Facsimile: 213-213-7301

 

If to PAR:

 

PAR Investment Partners, L.P.
One International Place, Suite 2401
Boston, MA 02110
Attention: Chief Operating Officer and General Counsel
Facsimile: 617-556-8875

 

with a copy to:

 

Robert P. Whalen , Esq.
Goodwin Procter LLP
Exchange Place
Boston, MA 02109
Facsimile: 617-523-1231

 

11.6          Time of the Essence. For the purposes of this Agreement and the
transactions contemplated by this Agreement, time is of the essence.

 

11.7          Headings. The underlined headings contained in this Agreement are
for convenience of reference only, shall not be deemed to be a part of this
Agreement and shall not be referred to in connection with the construction or
interpretation of this Agreement.

 

11.8          Counterparts. This Agreement may be executed in several
counterparts, each of which shall constitute an original and all of which, when
taken together, shall constitute one agreement.

 

11.9          Governing Law; Venue. This Agreement shall be construed in
accordance with, and governed in all respects by, the laws of the State of New
York (without giving effect to principles of conflicts of laws). Any Legal
Proceeding relating to this Agreement or the enforcement of any provision of
this Agreement may be brought or otherwise commenced in any federal or state
court located in New York, New York. Parent and the Company: (a) expressly and
irrevocably consent and submit to the jurisdiction of each federal and state
court located in New York, New York in connection with any such Legal
Proceeding; (b) agree that service of any process, summons, notice or document
by U.S. mail addressed to Parent or the Company at the address set forth in
Section 11.5 shall constitute effective service of such process, summons, notice
or document for purposes of any such Legal Proceeding; (c) agree that each
federal or state court located in New York, New York, shall be deemed to be a
convenient forum; and (d) agree not to assert (by way of motion, as a defense or
otherwise), in any such Legal Proceeding commenced in any federal or state court
located in New York, New York any claim that such party is not subject
personally to the jurisdiction of such court, that such Legal Proceeding has
been brought in an inconvenient forum, that the venue of such action or
proceeding is improper or that this Agreement or the subject matter of this
Agreement may not be enforced in or by such court.

 

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11.10      Successors and Assigns; Assignment. This Agreement shall be binding
upon each of the parties hereto and each of their successors and permitted
assigns, if any. This Agreement shall not be assigned by any party hereto, by
operation of law or otherwise, without the prior written consent of the other
parties hereto.

 

11.11      Remedies Cumulative; Specific Performance. The rights and remedies of
the parties hereto shall be cumulative (and not alternative). The parties to
this Agreement agree that, in the event of any breach or threatened breach by
any party to this Agreement of any covenant, obligation or other provision set
forth in this Agreement for the benefit of any other party to this Agreement,
such other party shall be entitled (in addition to any other remedy that may be
available to it) to (a) a decree or order of specific performance or mandamus to
enforce the observance and performance of such covenant, obligation or other
provision and (b) an injunction restraining such breach or threatened breach.
The parties further agree that no Indemnitee or other Person shall be required
to obtain, furnish or post any bond or similar instrument in connection with or
as a condition to obtaining any remedy referred to in Section 10, and each party
hereto irrevocably waives any right it may have to require any Indemnitee or
other Person to obtain, furnish or post any such bond or similarly instrument.

 

11.12      Waiver. No failure on the part of any Person to exercise any power,
right, privilege or remedy under this Agreement, and no delay on the part of any
Person in exercising any power, right, privilege or remedy under this Agreement,
shall operate as a waiver of such power, right, privilege or remedy; and no
single or partial exercise of any such power, right, privilege or remedy shall
preclude any other or further exercise thereof or of any other power, right,
privilege or remedy. No Person shall be deemed to have waived any claim arising
out of this Agreement, or any power, right, privilege or remedy under this
Agreement, unless the waiver of such claim, power, right, privilege or remedy is
expressly set forth in a written instrument duly executed and delivered on
behalf of such Person; and any such waiver shall not be applicable or have any
effect except in the specific instance in which it is given.

 

11.13      Amendments. This Agreement may not be amended, modified, altered or
supplemented other than by means of a written instrument duly executed and
delivered on behalf of all of the parties hereto.

 

11.14      Severability. In the event that any provision of this Agreement, or
the application of any such provision to any Person or set of circumstances,
shall be determined to be invalid, unlawful, void or unenforceable to any
extent, the remainder of this Agreement, and the application of such provision
to Persons or circumstances other than those as to which it is determined to be
invalid, unlawful, void or unenforceable, shall not be impaired or otherwise
affected and shall continue to be valid and enforceable to the fullest extent
permitted by law.

 

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11.15      Parties in Interest. Except for (a) the rights of the Company
Stockholders set forth in Sections 1.5 and 1.7, (b) the rights of Parent
Indemnified Parties and Company Indemnified Parties set forth in Section 10 and
(c) the rights of holders of Company Options set forth in Section 1.9(a)(i) and
the rights of holders of Company Warrants set forth in Section 1.9(b), none of
the provisions of this Agreement is intended to provide any rights or remedies
to any Person other than the parties hereto and their respective successors and
permitted assigns, if any.

 

11.16      Entire Agreement. This Agreement and the other agreements referred to
herein set forth the entire understanding of the parties hereto relating to the
subject matter hereof and thereof and supersede all prior agreements and
understandings among or between any of the parties relating to the subject
matter hereof and thereof, including the Letter Agreement dated August 15, 2012
by and among the Company, Parent and PAR; provided, however, that the Mutual
Nondisclosure Agreement, dated July 27, 2012, by and between Parent and the
Company shall not be superseded by this Agreement and shall remain in effect in
accordance with its terms.

 

11.17      Schedules of Exceptions. The Schedule of Exceptions and Parent
Schedule of Exceptions shall be arranged in separate parts corresponding to the
numbered and lettered sections contained herein. The information disclosed in
any numbered or lettered part shall be deemed to relate to and to qualify only
the particular representation or warranty set forth in the corresponding
numbered or lettered section in Sections 2 or 3, as the case may be (or as
otherwise required to be set forth in the Schedule of Exceptions or Parent
Schedule of Exceptions pursuant to the terms of this Agreement), and shall not
be deemed to relate to or qualify any other representation or warranty made by
such party hereunder unless such relationship or qualification is reasonably
apparent on the face of such disclosure.

 

11.18      Waiver of Jury Trial. Each of the parties hereto hereby irrevocably
waives any and all right to trial by jury in any Legal Proceeding arising out of
this Agreement or the transactions contemplated hereby.

 

11.19      Release. Effective as of the Closing, each Company Stockholder,
holder of Company Options and holder of Company Warrants (collectively, the
“Company Equityholders”), by virtue of accepting such number of shares of Parent
Common Stock to which such Company Equityholder is entitled hereunder, on behalf
of himself, herself or itself and its, his or her affiliates and each of its,
his or her (as applicable) and their respective officers, directors, employees,
agents, successors and assigns (the “Releasing Parties”), hereby releases,
acquits and forever discharges Parent, the Company, Merger Sub, each of their
respective affiliates, subsidiaries, and any and all of each of their respective
successors and assigns, together with all their present and former directors and
officers (the “Released Parties”), from any and all manner of claims, actions,
suits, damages, demands and liabilities whatsoever in law or equity, whether
known or unknown, liquidated or unliquidated, fixed, contingent, direct or
indirect (collectively, “Claims”), which the Releasing Party ever had, has or
may have against any of the Released Parties for, upon, or by reason of any
matter, transaction, act, omission or thing whatsoever arising under or in
connection with any of the Released Parties, from any time prior to and up to
and including the Closing Date, with respect to such Person’s status as a
stockholder of the Company. The foregoing shall not constitute a release of
claims or any other matter with respect to (i) receipt of such number of shares
of Parent Common Stock to which a Company Equityholder is entitled pursuant to
the terms and conditions of this Agreement, as further set forth in such Company
Equityholder’s Letter of Transmittal or Option Holder Letter of Transmittal, as
applicable, (ii) any of the rights of a Company Equityholder or any obligations
of the Released Parties to such Company Equityholder, in each case arising under
this Agreement, (iii) any of the rights of a Company Stockholder under the
Charter Documents to indemnification from the Company for actions or inactions
by such Company Stockholder or any of its Affiliates as a director or officer of
the Company, (iv) if a Company Equityholder is an employee of the Company as of
the Closing Date, any rights of such Company Equityholder to payments in respect
of such employment, including rights under any Company Plan identified on the
Schedule of Exceptions in accordance with the terms of such plan, and (v) any of
the rights of a Company Stockholder or any of its Affiliates under or pursuant
to written commercial contracts with the Company set forth on the Schedule of
Exceptions and unrelated to such Company Stockholder’s status of a stockholder
of the Company, and (vi) PAR’s rights under the Backstop Agreement, the Backstop
Fee Agreement and the AIA Transaction Agreements.

 

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11.20      Construction.

 

(a)               For purposes of this Agreement, whenever the context requires:
the singular number shall include the plural, and vice versa; the masculine
gender shall include the feminine and neuter genders; the feminine gender shall
include the masculine and neuter genders; and the neuter gender shall include
the masculine and feminine genders.

 

(b)               The parties hereto agree that any rule of construction to the
effect that ambiguities are to be resolved against the drafting party shall not
be applied in the construction or interpretation of this Agreement.

 

(c)                As used in this Agreement, the words “include” and
“including,” and variations thereof, shall not be deemed to be terms of
limitation, but rather shall be deemed to be followed by the words “without
limitation.”

 

(d)               Except as otherwise indicated, all references in this
Agreement to “Sections”, “Schedules” and “Exhibits” are intended to refer to
Sections of this Agreement and Schedules and Exhibits to this Agreement.

 

[Signature page follows]

 

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The parties hereto have caused this Agreement to be executed and delivered as of
the date first written above.

 

  Global Eagle Acquisition Corp.,   a Delaware corporation       By: /s/ James
Graf___________________   Name: James Graf   Title: Vice President       EAGL
Merger Sub Corp.,   a Delaware corporation       By: /s/ James
Graf___________________   Name: James Graf   Title: Treasurer and Secretary    
  Row 44, Inc.,   a Delaware corporation       By: /s/ John La
Valle__________________   Name: John La Valle   Title: Chief Executive Officer  
    Par Investment Partners, L.P.,   as Stockholders’ Agent and on its own
behalf solely for the purposes of Sections
4.4, 4.6, 7.7 and 11 hereof       By: PAR Capital Management, Inc., its general
partner       By: /s/ Steven M. Smith_________________   Name: Steven M. Smith  
Title: Chief Operating Officer and General Counsel

 

 

 

 

Exhibit A

CERTAIN DEFINITIONS

 

For purposes of this Agreement (including this Exhibit A):

 

Acquisition Proposal. “Acquisition Proposal” shall mean any offer, proposal or
inquiry (other than an offer or proposal by Parent) contemplating or otherwise
relating to any Acquisition Transaction.

 

Acquisition Transaction. “Acquisition Transaction” means any transaction (other
than the transaction between Parent and the Company contemplated by this
Agreement) involving:

 

(a) the sale, license, disposition or acquisition of all or a material portion
of the business or assets of the Company (taken as a whole);

 

(b) the direct or indirect acquisition (including by way of a tender or exchange
offer) by of beneficial ownership or a right to acquire beneficial ownership of
shares representing a majority of the voting power of the then outstanding
shares of capital stock of the Company; or

 

(b) any other merger, consolidation, business combination, reorganization or
similar transaction involving the Company.

 

Aggregate Share Number. “Aggregate Share Number” means, immediately prior to the
Effective Time, the sum of (a) the total number of shares of Company Common
Stock that are issued and outstanding, (b) the total number of shares of Company
Common Stock issuable upon conversion or redemption of all issued and
outstanding shares of Company Preferred Stock pursuant to the terms of the
Restated Certificate (including accrued dividends thereon), (c) the Deemed
Company Option Share Number, and (d) the maximum number of shares of Company
Common Stock that are issuable upon the full exercise of all Included Company
Warrants.

 

Aggregate Warrant Value. “Aggregate Warrant Value” means $6,958,776; provided,
that if at Closing the Black Scholes Value of the Rolled Company Warrants
(including only 14% of the Black Scholes Value of the AIA Warrant) is different
than such amount, then, upon the request of either the Company or Parent to the
other, the Aggregate Warrant Value shall be equal to the Black Scholes Value of
the Rolled Company Warrants (including only 14% of the Black Scholes Value of
the AIA Warrant) at Closing.

 

Agreement. “Agreement” means this Agreement and Plan of Merger and
Reorganization to which this Exhibit A is attached (including the Schedule of
Exceptions and Parent Schedule of Exceptions), as it may be amended from time to
time.

 

AIA. “AIA” means Advanced Inflight Alliance AG, a German corporation.

 

 

 

 

AIA Transaction Agreements. “AIA Transaction Agreements” means the agreements
entered into by and among PAR, AIA and Parent for the acquisition by Parent of
the outstanding shares of the capital stock of AIA held by PAR.

 

AIA Warrant. “AIA Warrant” means that certain Preferred Stock Purchase Warrant,
PW No. C-1-2, dated as of June 7, 2012, issued by the Company to AIA.

 

Backstop Agreement. “Backstop Agreement” means that certain Amended and Restated
Common Stock Purchase Agreement, dated as of the date hereof, by and between
Parent and PAR, as amended, relating to, among other things, the mandatory and
optional purchase by PAR of up to 4.75 million shares of Parent Common Stock at
a purchase price per share equal to the Parent Share Price.

 

Backstop Fee Agreement. “Backstop Fee Agreement” means an Agreement between the
Company and PAR with respect to the payment due to PAR at the Closing in
connection with its execution and delivery of the Backstop Agreement, which
payment due to PAR is $11,875,000 in the aggregate.

 

Black Scholes Value. “Black Scholes Value” means, with respect to any Company
Warrant, the value of such Company Warrant based on the Black and Scholes Option
Pricing Model obtained from the “OV” function on Bloomberg Financial Markets
determined as of the day of the Closing for pricing purposes, and reflecting:
(i) a risk-free interest rate corresponding to the U.S. Treasury rate for a
period equal to the remaining term of the Company Warrant as of such date, (ii)
volatility of fifty percent (50%), (iii) dividend yield of zero, and (iv) term
equal to the remaining term of the Company Warrant as of such date.

 

Closing Date Working Capital. “Closing Date Working Capital” means the amount as
of the Adjustment Calculation Time equal to (A) the Company’s current assets
less (B) the Company’s current liabilities (excluding any current portion of
Indebtedness), in each case as determined in accordance with GAAP and in a
manner consistent with the preparation of the Financial Statements.

 

Closing Date Working Capital Target. “Closing Date Working Capital Target” means
$0.

 

Closing Net Merger Shares. “Closing Net Merger Shares” means the number of
shares of Parent Common Stock equal to the number of Closing Total Merger
Shares, reduced by (i) the total number of Company Option Settlement Shares and
(ii) the number of shares of Parent Common Stock underlying the Included Company
Warrants from and after the Effective Time pursuant to Section 1.9(b).

 

Closing Total Merger Shares. “Closing Total Merger Shares” means such number of
shares of Parent Common Stock equal to (a) the Estimated Net Merger
Consideration, divided by (b) the Parent Share Price.

 

Code. “Code” means the Internal Revenue Code of 1986, as amended.

 

 

 

 

Company Capital Stock. “Company Capital Stock” means the Company Common Stock
and the Company Preferred Stock.

 

Company Common Stock. “Company Common Stock” means the Company’s common stock,
par value $0.0001 per share.

 

Company Executives. “Company Executives” means each of John La Valle, Michael
Pigott and John Guidon.

 

Company Intellectual Property. “Company Intellectual Property” means (i)
patents, patent applications, patent disclosures and inventions, (ii)
trademarks, service marks, trade dress, trade names, logos and corporate names
and registrations and applications for registration thereof together with all of
the goodwill associated therewith, (iii) copyrights (registered or unregistered)
and copyrightable works and registrations and applications for registration
thereof, (iv) mask works and registrations and applications for registration
thereof, (v) computer software, data, databases and documentation thereof, (vi)
trade secrets and other confidential information (including, without limitation,
ideas, formulas, compositions, inventions (whether patentable or not and whether
or not reduced to practice), know-how, manufacturing and production processes
and techniques, research and development information, drawings, specifications,
designs, plans, proposals, technical data, copyrightable works, financial and
marketing plans and customer and supplier lists and information), (vii) other
intellectual property rights and (viii) copies and tangible embodiments thereof
(in whatever form or medium).

 

Company Option. “Company Option” means each option to purchase shares of Company
Common Stock outstanding under the 2011 Equity Incentive Plan.

 

Company Penny Warrant. “Company Penny Warrant” means each Company Warrant (other
than the Performance Warrant) which has an exercise price of $0.0001 or less per
share of Company Common Stock or Company Preferred Stock, as the case may be.

 

Company Preferred Stock. “Company Preferred Stock” means the following series of
the Company’s Preferred Stock: (a) Series A-1 Convertible Preferred Stock, par
value $0.0001 per share, (b) Series A-2 Convertible Preferred Stock, par value
$0.0001 per share, (c) Series B-1 Convertible Preferred Stock, par value $0.0001
per share, (d) Series B-2 Convertible Preferred Stock, par value $0.0001 per
share, (e) Series C-1 Convertible Preferred Stock, par value $0.0001 per share,
and (f) Series C-2 Convertible Preferred Stock, par value $0.0001 per share.

 

Company Recap Notes. “Company Recap Notes” means the form of promissory note
given to a Company Stockholder in connection with the acquisition of Repurchased
Shares from such Company Stockholder pursuant to Section 1.10 of this Agreement.

 

Company Stock Certificate. “Company Stock Certificate” means a valid certificate
representing shares of the Company Capital Stock immediately prior to the
Closing.

 

Company Stockholders. “Company Stockholders” means the holders of Company
Capital Stock.

 

 

 

 

Consent. “Consent” means any approval, consent, ratification, permission, waiver
or authorization (including any Governmental Authorization).

 

Contract. “Contract” means any written, oral or other agreement, contract,
subcontract, lease, understanding, instrument, note, warranty, insurance policy,
benefit plan or legally binding commitment or undertaking of any nature.

 

Damages. “Damages” include any loss, damage, injury, decline in value, lost
opportunity, liability, claim, demand, settlement, judgment, award, fine,
penalty, tax, fee (including reasonable attorneys’ fees), charge, cost
(including reasonable costs of investigation) or expense of any nature;
provided, however, that Damages will not include incidental, consequential,
indirect, punitive, special or exemplary Damages, except to the extent any such
incidental, consequential, indirect, punitive, special or exemplary Damages are
part of a claim made by a third party against an Indemnified Party.

 

Deemed Company Option Share Number. “Deemed Company Option Share Number” means
such number calculated by subtracting from the maximum number of shares of
Company Common Stock underlying Company Options, such number of shares of
Company Common Stock equal to (i) the total exercise price for all such Company
Options, divided by (ii) the Theoretical Company Common Share Price, or by such
other method agreed to by the Company and PAR which shall not result in Parent’s
issuance at Closing of such number of shares of Parent Common Stock exceeding
the sum of the Closing Net Merger Shares and the Company Option Settlement
Shares.

 

Effective Time. “Effective Time” means the time that the Certificate of Merger
is filed with the Secretary of State of the State of Delaware, or at such later
time as Parent and the Company shall designate in the Certificate of Merger.

 

Encumbrance. “Encumbrance” means any lien, pledge, hypothecation, charge,
mortgage, security interest, encumbrance, claim, infringement, interference,
option, right of first refusal, preemptive right, community property interest or
restriction of any nature (including any restriction on the voting of any
security, any restriction on the transfer of any security or other asset, any
restriction on the receipt of any income derived from any asset, any restriction
on the use of any asset and any restriction on the possession, exercise or
transfer of any other attribute of ownership of any asset).

 

Entity. “Entity” means any corporation (including any non-profit corporation),
general partnership, limited partnership, limited liability partnership, joint
venture, estate, trust, company (including any limited liability company or
joint stock company), firm or other enterprise, association, organization or
entity.

 

Environmental Law. “Environmental Law” means any federal, state, local or
foreign Legal Requirement relating to pollution or protection of human health or
the environment (including ambient air, surface water, ground water, land
surface or subsurface strata), including any law or regulation relating to
emissions, discharges, releases or threatened releases of Materials of
Environmental Concern, or otherwise relating to the manufacture, processing,
distribution, use, treatment, storage, disposal, transport or handling of
Materials of Environmental Concern.

 

 

 

 

ERISA. “ERISA” means the Employee Retirement Income Security Act of 1974, as
amended.

 

Escrow Agent. “Escrow Agent” means American Stock Transfer & Trust Company LLC.

 

Escrow Agreement. “Escrow Agreement” means that certain Escrow Agreement, dated
as of the Effective Date, by and among Parent, the Stockholders’ Agent and the
Escrow Agent, with such agreement substantially in the form of Exhibit F hereto.

 

Estimated Net Merger Consideration. “Estimated Net Merger Consideration” means
an amount equal to $250 million, reduced by any Estimated Indebtedness,
Estimated Working Capital Shortfall and the Aggregate Warrant Value, and
increased by any Estimated Working Capital Surplus.

 

Excess Payments. “Excess Payments” means amounts in the nature of compensation
which may reasonably be deemed contingent on a change of control of the Company
for purposes of Section 280G of the Code (including as a result of the
consummation of the transactions contemplated by this Agreement) and which
otherwise would constitute parachute payments under Section 280G of the Code.

 

Exchange Act. “Exchange Act” means the Securities Exchange Act of 1934, as
amended.

 

Final Net Merger Consideration. “Final Net Merger Consideration” means an amount
equal to $250 million, reduced by the Final Indebtedness, any Final Working
Capital Shortfall and the Aggregate Warrant Value, and increased by any Final
Working Capital Surplus.

 

Final Net Merger Shares. “Final Net Merger Shares” means the number of shares of
Parent Common Stock equal to the number of Final Total Merger Shares, reduced by
(i) the total number of Company Option Settlement Shares and (ii) the number of
shares of Parent Common Stock underlying the Included Company Warrants from and
after the Effective Time pursuant to Section 1.9(b).

 

Final Total Merger Shares. “Final Total Merger Shares” means such number of
shares of Parent Common Stock equal to (a) the Final Net Merger Consideration,
divided by (b) the Parent Share Price.

 

Fundamental Representations. “Fundamental Representations” means those
representations and warranties set forth in Sections 2.1 (Organization;
Qualification), 2.2 (Power; Authorization), 2.3 (Non-Contravention), 2.4
(Capitalization), 2.6 (Brokers or Finders), 2.13 (Taxes), 3.1 (Organization;
Qualification), 3.2 (Power; Authorization), 3.3 (No Conflict; Consents), 3.5
(Capitalization), 3.8 (Taxes) and 3.12 (Brokers or Finders).

 

 

 

 

Governmental Authorization. “Governmental Authorization” means any: (a) permit,
license, certificate, franchise, permission, clearance, registration,
qualification or authorization issued, granted, given or otherwise made
available by or under the authority of any Governmental Body or pursuant to any
Legal Requirement; or (b) right under any Contract with any Governmental Body.

 

Governmental Body. “Governmental Body” means any: (a) nation, state,
commonwealth, province, territory, county, municipality, district or other
jurisdiction of any nature; (b) federal, state, local, municipal, foreign or
other government; or (c) governmental or quasi-governmental authority of any
nature (including any governmental division, department, agency, commission,
instrumentality, official, organization, unit, body or Entity and any court or
other tribunal).

 

Hazardous Materials. “Hazardous Materials” include chemicals, pollutants,
contaminants, wastes, toxic substances, petroleum and petroleum products and any
other substance that is now or hereafter regulated by any Environmental Law or
that is otherwise a danger to health, reproduction or the environment

 

HSR Act. “HSR Act” means the Hart-Scott-Rodino Antitrust Improvements Act of
1976, as amended.

 

Included Company Warrants. “Included Company Warrants” means (i) any Company
Penny Warrants which are not exercised at or prior to the Closing and (ii) the
portion of the Performance Warrant which, as of the Effective Time, is vested.

 

Indebtedness. “Indebtedness” means (i) all obligations of the Company or any
Subsidiary for borrowed money, whether current or unfunded, secured or unsecured
(including, for purposes of clarification, payment obligations of the Company
under the Backstop Fee Agreement, Repurchase Notes or any other agreement for
the Company’s purchase of Repurchased Shares pursuant to Section 1.10), (ii) all
obligations of the Company or any Subsidiary for the deferred purchase price of
any property or services (other than trade accounts payable arising in the
ordinary course of the Company’s business consistent with past practice), (iii)
all obligations of the Company or any Subsidiary created or arising under any
conditional sale or other title retention agreement with respect to property
acquired by the Company or its Subsidiary, (iv) all obligations of the Company
of any Subsidiary secured by a purchase money mortgage or other Encumbrance to
secure all or part of the purchase price of property subject to such mortgage or
Encumbrance, (v) all obligations under leases which shall have been or should
be, in accordance with GAAP, recorded as capital leases in respect of which the
Company or any Subsidiary is liable as lessee, (vi) any obligation of the
Company or any Subsidiary in respect of bankers’ acceptances or letters of
credit, (vii) any obligations secured by Encumbrances on property acquired by
the Company or any Subsidiary, whether or not such obligations were assumed by
the Company or its Subsidiary at the time of acquisition of such property,
(viii) all unfunded Company Plans, (ix) all obligations of a type referred to in
clause (i), (ii), (iii), (iv), (v), (vi), (vii) or (viii) above which are
directly or indirectly guaranteed by the Company or which it has agreed
(contingently or otherwise) to purchase or otherwise acquire or in respect of
which it has otherwise assured a credit against loss, (x) interest, principal,
prepayment penalty, fees, or expenses, to the extent due and owing in respect of
those items listed in clauses (i) through (ix) above, whether resulting from
their payment or discharge or otherwise and (xi) any refinancings of any of the
foregoing obligations.

 

 

 

 

Indemnitees. “Indemnitees” means any Person entitled to indemnification pursuant
to Section 10 of this Agreement.

 

Key Employee. “Key Employee” means (i) any executive-level employee of the
Company, including, without limitation, the Company Executives, and (ii) any
employee who either alone or in concert with others develops, invents, programs
or designs any Company Intellectual Property.

 

Legal Proceeding. “Legal Proceeding” means any action, suit, litigation,
arbitration, proceeding (including any civil, criminal, administrative,
investigative or appellate proceeding), hearing, inquiry, audit, examination or
investigation commenced, brought, conducted or heard by or before, or otherwise
involving, any court or other Governmental Body or any arbitrator or arbitration
panel.

 

Legal Requirement. “Legal Requirement” means any federal, state, local,
municipal, foreign or other law, statute, constitution, principle of common law,
resolution, ordinance, code, edict, decree, rule, regulation, ruling or
requirement issued, enacted, adopted, promulgated, implemented or otherwise put
into effect by or under the authority of any Governmental Body.

 

Letter of Transmittal. “Letter of Transmittal” means a letter of transmittal to
be executed and delivered by holders of shares of Company Capital Stock pursuant
to the exchange procedures set forth in Section 1.7, in such form to be mutually
agreed to by Parent and the Company prior to Closing; provided, that such letter
of transmittal shall provide that (a) (1) forty percent (40%) of the shares of
Parent Common Stock (other than the Escrow Shares) issued to or otherwise held
by the holder (including shares of Parent Common Stock underlying any warrants
held by such holder) and (2) all of the Escrow Shares being held in escrow for
the benefit of the holder, but excluding any shares of Parent Common Stock
issued to a holder pursuant to the Backstop Agreement (as the Backstop Agreement
may be amended, supplemented or modified) and which shares of Parent Common
Stock issued pursuant to the Backstop Agreement shall not be subject to any
restriction described herein) (collectively, the “Subject Shares”) may not be
sold, transferred or otherwise disposed of until the earlier to occur of (i) six
(6) months from the Closing and, (ii) if prior to the end of such six-month
period the last sales price of Parent Common Stock equals or exceeds $12.00 per
share (as adjusted for stock splits, stock dividends, reorganizations,
recapitalizations and the like) for any 20 trading days within any 30-trading
day period commencing at least 45 days after the Closing, the last day of such
30-trading day period, and (b) the remaining fifty percent (50%) of such Subject
Shares may not be sold, transferred or otherwise disposed of until the earlier
to occur of (i) the first anniversary of the Closing and, (ii) if prior to such
first anniversary the last sales price of Parent Common stock equals or exceeds
$12.00 per share (as adjusted for stock splits, stock dividends,
reorganizations, recapitalizations and the like) for any 20 trading days within
any 30-trading day period commencing at least six months after the Closing, the
last day of such 30-trading day period; provided, that in each case, the
foregoing restrictions will expire immediately prior to the consummation by
Parent of a liquidation, merger, stock exchange or other similar transaction
after the Closing that results in all of its stockholders having the right to
exchange their shares of common stock for cash, securities or other property.

 

 

 

 

Material Adverse Effect. An event, violation, inaccuracy, circumstance or other
matter will be deemed to have a “Material Adverse Effect” on the Company and its
Subsidiaries, taken as a whole, if such violation or other matter (considered
together with all other matters that would constitute exceptions to the
Company’s representations and warranties set forth in the Agreement but for the
presence of “Material Adverse Effect” or other materiality qualifications, or
any similar qualifications, in such representations and warranties) would
reasonably be expected to have a material adverse effect on the business,
properties, condition (financial or otherwise), capitalization, results of
operations, financial performance or prospects of the Company and its
Subsidiaries, considered as a whole.

 

Maximum Redemption Amount. “Maximum Redemption Amount” means 12,661,667 shares
of Parent Common Stock; provided, that to the extent that, on or after the date
hereof, (a) Parent enters into any agreement (other than the Backstop Agreement)
with any Person, pursuant to which such Person (each, an “Additional Purchaser”)
is obligated to purchase shares of Parent Common Stock (or any security
convertible into or exchangeable for shares of Parent Common Stock) at a price
per share greater than or equal to the Parent Share Price prior to the Effective
Time, or (b) the Backstop Agreement is amended to provide for PAR’s purchase of
more than 4.75 million shares of Parent Common Stock, then the Maximum
Redemption Amount shall be increased share-for share by the number of additional
shares of Parent Common Stock which such Additional Purchaser or PAR has agreed
to purchase pursuant thereto.

 

Option Holder Letter of Transmittal. “Option Holder Letter of Transmittal” means
a letter of transmittal to be executed and delivered by holders of Company
Options pursuant to the exchange procedures set forth in Section 1.7, in such
form to be mutually agreed to by Parent and the Company prior to Closing;
provided, that such letter of transmittal shall provide that (a) fifty percent
(50%) of the Subject Shares may not be sold, transferred or otherwise disposed
of until the earlier to occur of (i) six (6) months from the Closing and, (ii)
if prior to the end of such six-month period the last sales price of Parent
Common Stock equals or exceeds $12.00 per share (as adjusted for stock splits,
stock dividends, reorganizations, recapitalizations and the like) for any 20
trading days within any 30-trading day period commencing at least 45 days after
the Closing, the last day of such 30-trading day period, and (b) the remaining
fifty percent (50%) of such Subject Shares may not be sold, transferred or
otherwise disposed of until the earlier to occur of (i) the first anniversary of
the Closing and, (ii) if prior to such first anniversary the last sales price of
Parent Common stock equals or exceeds $12.00 per share (as adjusted for stock
splits, stock dividends, reorganizations, recapitalizations and the like) for
any 20 trading days within any 30-trading day period commencing at least six
months after the Closing, the last day of such 30-trading day period; provided,
that in each case, the foregoing restrictions will expire on the date on which
Parent completes a liquidation, merger, stock exchange or other similar
transaction after the Closing that results in all of its stockholders having the
right to exchange their shares of common stock for cash, securities or other
property.

 

 

 

 

Parent 2012 Equity Incentive Plan. “Parent 2012 Equity Incentive Plan” means the
Parent 2012 Equity Incentive Plan in such form submitted by Parent to the vote
of its stockholders in the definitive Proxy Statement.

 

Parent Common Stock. “Parent Common Stock” means shares of Parent’s Common
Stock, par value $0.0001 per share.

 

Parent Options. “Parent Options” means options to acquire shares of Parent
Common Stock under the Parent 2012 Equity Incentive Plan.

 

Parent Schedule of Exceptions. “Parent Schedule of Exceptions” means the
schedule (dated as of the date of this Agreement) delivered to the Company on
behalf of Parent pursuant to Section 3 of this Agreement.

 

Parent Share Price. “Parent Share Price” means $10.00.

 

Parent’s Sponsor. “Parent’s Sponsor” means Global Eagle Acquisition LLC, a
Delaware limited liability company.

 

Parent Stockholders. “Parent Stockholders” means the holders of Parent Common
Stock.

 

Parent Warrants. “Parent Warrants” mean (a) warrants to purchase 18,992,500
shares of Parent Common Stock at an exercise price of $11.50 per share and (b)
warrants to purchase 7,000,000 shares of Parent Common Stock at an exercise
price of $11.50 per share.

 

Performance Warrant. “Performance Warrant” means that certain warrant to
purchase 101,260,000 shares of Company Common Stock to be issued by the Company
to Hughes Network Systems, LLC, subject to the covenants set forth in Section
4.2, at a deemed price of $0.30 per share, the other material terms of which,
including the vesting schedule thereof, are further described in Section A of
the Schedule of Exceptions.

 

Person. “Person” means any individual, Entity or Governmental Body.

 

Proprietary Asset. “Proprietary Asset” means any: (a) patent, patent
application, trademark (whether registered or unregistered), trademark
application, trade name, fictitious business name, service mark (whether
registered or unregistered), service mark application, copyright (whether
registered or unregistered), copyright application, maskwork, application, trade
secret, know-how, customer list, franchise, system, computer software, computer
program, invention, design, blueprint, engineering drawing, proprietary product,
technology, proprietary right or other intellectual property right or intangible
asset; or (b) right to use or exploit any of the foregoing.

 

Representatives. “Representatives” means officers, directors, employees, agents,
attorneys, accountants, advisors and representatives.

 

 

 

 

Registration Rights Agreement. “Registration Rights Agreement” means that
certain Registration Rights Agreement, dated as of the Effective Date, by and
among Parent, Parent’s Sponsor, PAR and the other parties thereto substantially
in the form of Exhibit G hereto.

 

Required Votes. “Required Votes” means the Required Company Vote and the
Required Parent Vote.

 

Rolled Company Warrants. “Rolled Company Warrants” means all Company Warrants
other than (i) the Company Penny Warrants and (ii) the Performance Warrant.

 

Schedule of Exceptions. “Schedule of Exceptions” means the schedule (dated as of
the date of this Agreement) delivered to Parent on behalf of the Company
pursuant to Section 2 of the Agreement.

 

SEC. “SEC” means the United States Securities and Exchange Commission.

 

Securities Act. “Securities Act” means the Securities Act of 1933, as amended.

 

Share Exchange Ratio. “Share Exchange Ratio” means, the quotient obtained by
dividing (a) the Closing Total Merger Shares by (b) the Aggregate Share Number.

 

Subsidiary. “Subsidiary” means any Entity of which the Company directly or
indirectly owns 50% or more of the equity or that the Company otherwise directly
or indirectly controls.

 

Tax. “Tax” means any tax (including any income tax, franchise tax, capital gains
tax, gross receipts tax, value-added tax, surtax, excise tax, ad valorem tax,
transfer tax, stamp tax, sales tax, use tax, property tax, business tax,
withholding tax or payroll tax), levy, assessment, tariff, duty (including any
customs duty), deficiency or fee, and any related charge or amount (including
any fine, penalty or interest), imposed, assessed or collected by or under the
authority of any Governmental Body.

 

Tax Return. “Tax Return” means any return (including any information return),
report, statement, declaration, estimate, schedule, notice, notification, form,
election, certificate or other document or information filed with or submitted
to, or required to be filed with or submitted to, any Governmental Body in
connection with the determination, assessment, collection or payment of any Tax
or in connection with the administration, implementation or enforcement of or
compliance with any Legal Requirement relating to any Tax.

 

Termination Payment. “Termination Payment” means a fee of $25 million, plus the
reimbursement of all fees and expenses incurred by the Person seeking the
Termination Payment in connection with the transactions contemplated by this
Agreement through the date of termination of this Agreement pursuant to Section
9.1(g) or 9.1(h), with such total payment, including fees and expenses, not to
exceed $27.5 million.

 

Theoretical Company Common Share Price. “Theoretical Company Common Share Price”
means the quotient of (a) the sum of (i) the Estimated Net Merger Consideration
and (ii) the aggregate exercise price for all Company Options, divided by (b)
the sum of (i) the total number of shares of Company Common Stock that are
issued and outstanding, (ii) the total number of shares of Company Common Stock
issuable upon conversion or redemption of all issued and outstanding shares of
Company Preferred Stock pursuant to the terms of the Restated Certificate
(including accrued dividends thereon), (iii) the maximum number of shares of
Company Common Stock that are issuable upon the full exercise of all Company
Options, and (iv) the maximum number of shares of Company Common Stock that are
issuable upon the full exercise of all Included Company Warrants.

 

 

 

 

Total Merger Shares. “Total Merger Shares” means the Closing Total Merger
Shares, as adjusted per Section 1.14(b).

 

Transaction Agreements. “Transaction Agreements” mean the Voting Agreement, the
Escrow Agreement and all other documents, certificates or other instruments
entered into or delivered in connection with the transactions contemplated
hereby or thereby.

 

2011 Equity Incentive Plan. “2011 Equity Incentive Plan” means the Company’s
Amended and Restated 2011 Equity Incentive Plan.

 

For purposes of convenience, the capitalized terms listed below are defined
herein in the following Sections:

 

Capitalized Term Where Defined Accountant 1.14(b)(iii) Additional Parent Filings
4.9 Adjustment Calculation Time 1.14(a) Aggregate Overall Cap 10.2(d) Appraisal
Shares 1.8(c) Balance Sheet Date 2.11(a) Board 1.4(c) Cap 10.2(c)(i) Certificate
of Merger 1.3 Charter Documents 2.3 Claims 11.19 Closing 1.3 Closing Balance
Sheet 1.14(b)(i) Closing Date 1.3 Closing Statement 1.14(b)(i) COBRA 2.15(a)
Company Preamble Company Equityholders 11.19 Company Indemnified Party 10.2(b)
Company Option Settlement Shares 1.9(a)(i) Company Plan 2.15(a) Company
Stockholder Approval 2.24 Company System 2.17 Company Warrants 2.4(d)

 

 

 

 

Delivery Date 1.14(b)(ii) Determination Date 1.14(b)(iii) DGCL Recitals
Employment Agreements 7.6(i) ERISA Affiliate 2.15(b) Escrow Shares 1.7(b)
Estimated Closing Balance Sheet 1.14(a) Estimated Closing Date Working Capital
1.14(a) Estimated Indebtedness 1.14(a) Estimated Working Capital Shortfall
1.14(a) Estimated Working Capital Surplus 1.14(a) Exchange Agent 1.7(a)
Execution Date Preamble Expiration Date 10.1(a) Final Indebtedness 1.14(b)(i)
Final Working Capital 1.14(b)(i) Final Working Capital Shortfall 1.14(b)(i)
Final Working Capital Surplus 1.14(b)(i) Financial Statements 2.11(a) GAAP
2.11(a) Implied Merger Consideration Per Company Common Share 1.5(d) Indemnified
Party 10.5(a) Indemnifying Party 10.5(a) Leased Real Property 2.25 Letter of
Transmittal 1.7(b) Material Contract 2.19(b) Merger 1.1 Merger Stockholder
1.7(b) Merger Sub Preamble Multiemployer Plan 2.15(b) Non-Accredited Company
Stockholder 1.5(e) Objection Notice 1.14(b)(iii) Outside Date 9.1(b) PAR
Preamble Parent Preamble Parent Indemnified Party 10.2(a) Parent Record Date 5.1
Parent SEC Documents 3.7 Parent Stockholder Meeting 5.1 Parent Voting Matters
5.1 PCBs 2.20 Post-Closing Additional Shares 1.14(b)(iv) Post-Closing Matters
1.15 Post-Closing Reduction in Shares 1.14(b)(iv)

 

 

 

 

Pre-Closing Period 4.1 Proxy Statement 5.1 Related Party 2.16(b) Released
Parties 11.19 Releasing Parties 11.19 Repurchased Shares 1.10 Required Parent
Vote 3.10 Restated Certificate 1.5(d) Spreadsheet 1.5(d) Substitute Cash Amount
1.5(e) Surviving Corporation 1.1 Third Party Claim 10.5(a) Threshold Amount
10.2(c)(ii) Trust Account 3.11 Trust Agreement 3.11 Trustee 3.11