Filed by Bowne Pure Compliance



 




Exhibit 4.1




SECURITIES PURCHASE AGREEMENT




THIS SECURITIES PURCHASE AGREEMENT (this “Agreement”) is made as of January 15, 2008,
by and among SMART MOVE, INC., a Delaware corporation (the “Company”), and each of those
persons and entities, severally and not jointly, whose names are set forth on the Schedule of
Purchasers attached hereto as Exhibit A (which persons and entities are hereinafter collectively
referred to as “Purchasers” and each individually as a “Purchaser”).



RECITALS




WHEREAS, the Company has authorized the sale and issuance of secured convertible debentures,
warrants and common stock issuable upon exercise of the warrants (collectively, the
“Securities”) as provided herein;



WHEREAS, at the Closing (as defined herein), the Company desires to sell, and each Purchaser
desires to purchase, severally and not jointly, the Securities upon the terms and conditions stated
in this Agreement; and



NOW, THEREFORE, in consideration of the foregoing recitals and the mutual promises,
representations, warranties and covenants hereinafter set forth and for other good and valuable
consideration, the receipt and sufficiency of which are hereby acknowledged, the parties hereto
agree as follows:



ARTICLE 1




AUTHORIZATION AND SALE OF SECURITIES




1.1 Authorization. The Company has authorized the sale and issuance of up to $3,500,000 in
principal amount of its 11% Secured Convertible Debentures at an original issue discount of 15%
(the “Debentures”) and warrants (the “Warrants”) to purchase shares of its common
stock, par value $.0001 (the “Common Stock”).



1.2 Sale of Securities. At the Closing, subject to the terms and conditions of this
Agreement, the Company agrees to issue and sell to each Purchaser, severally and not jointly, and
each Purchaser agrees to purchase from the Company, severally and not jointly, securities
consisting of the instruments identified in (a) and (b) below, and to execute and deliver the other
documents identified in (c), (d) and (e) below:



(a) Debentures in the principal amount set forth opposite such Purchaser’s name on Exhibit A
under the heading “Principal Amount of Debentures”; and



(b) Warrants to purchase the number of shares of Common Stock set forth opposite such
Purchaser’s name on Exhibit A under the heading “Common Shares Underlying Warrants.” The shares of
Common Stock issuable upon exercise of the Warrants are referred to herein as the “Warrant
Shares.” The number of Warrant Shares shall be equal to fifty percent (50%) of the shares of
Common Stock which would be issuable upon conversion of the Debentures at the “Fixed Conversion
Price” or such lower price as defined in the Debentures, and Warrants shall be exercisable at $1.00
per share.


 


 









 





(c) A Security Agreement (the “Security Agreement”) among the Company and the
Purchasers;



(d) A Registration Rights Agreement (the “Registration Rights Agreement”) among the
Company and the Purchasers. This Agreement, the Securities, the Security Agreement, the Pledge
Agreement and the Registration Rights Agreement are sometimes collectively referred to herein as
the “Transaction Documents.”



1.3 Independent Nature of Investors’ Obligations and Rights. The obligations of each
Purchaser under this Agreement are several and not joint with the obligations of any other
Purchaser, and no Purchaser shall be responsible in any way for the performance of the obligations
of any other Purchaser hereunder. The decision of each Purchaser to purchase the Securities
pursuant to this Agreement has been made by such Purchaser independently of any other Purchaser.
Nothing contained herein or therein, and no action taken by any Purchaser pursuant hereto or
thereto, shall be deemed to constitute the Purchasers as a partnership, an association, a joint
venture or any other kind of entity, or create a presumption that the Purchasers are in any way
acting in concert or as a group with respect to such obligations or the transactions contemplated
hereby. Each Purchaser acknowledges that no other Purchaser has acted as agent for such Purchaser
in connection with making its investment hereunder and that no Purchaser will be acting as agent of
such Purchaser in connection with monitoring its investment in the Securities or enforcing its
rights under this Agreement. Each Purchaser shall be entitled independently to protect and enforce
its rights, including without limitation the rights arising out of this Agreement, and it shall not
be necessary for any other Purchaser to be joined as an additional party in any proceeding for such
purpose.



ARTICLE 2




CLOSING DATE; DELIVERY




2.1 Closing Date. The closing of the purchase and sale of the Securities hereunder (the
“Closing”) shall be held at the offices of                                         , at
 _____ 
:
 _____ 
..m. New York
time on or before January 15, 2008 or at such other time and place upon which the Company and the
Purchasers purchasing, in the aggregate, the majority in principal amount of the Debentures (the
“Majority in Interest”) shall agree.



2.2 Delivery. At the Closing, the Company will deliver to each Purchaser a duly executed
Debenture in the principal amount set forth opposite such Purchaser’s name on Exhibit A, a Warrant
representing the right to purchase the number of Warrant Shares which such Purchaser is entitled to
purchase and a signed counterpart of each of the other Transaction Documents. Such delivery shall
be against payment of the purchase price therefor by wire transfer of immediately available funds
to the Company in accordance with the Company’s written wiring instructions, which instructions
shall have been delivered to Purchasers’ counsel. The Company shall also deliver to the Purchasers
(a) an opinion of Messner & Reeves, LLC., counsel to the Company, in form and substance
satisfactory to the Majority in Interest and (b) a certificate from a duly authorized officer of
the Company certifying that the representations made by the Company in Article 3 are true and
correct as of the Closing.


 


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ARTICLE 3




REPRESENTATIONS AND WARRANTIES OF THE COMPANY





The Company represents and warrants to the Purchasers, as of the date hereof, as follows:



3.1 Organization and Standing. The Company is a corporation duly organized and validly
existing under, and by virtue of, the laws of the State of Delaware and is in good standing under
the laws of said state, with requisite corporate power and authority to own its properties and
assets and to carry on its business as currently conducted. The Company is not in violation of any
of the provisions of its Certificate of Incorporation (the “Certificate”) or Bylaws.



3.2 Corporate Power; Authorization. The Company has all requisite legal and corporate power
and has taken all requisite corporate action to execute and deliver this Agreement and the other
Transaction Documents, to sell and issue the Securities, to issue the Warrant Shares upon exercise
of the Warrants in accordance with the terms of such Warrants, and to carry out and perform all of
its obligations under this Agreement and the Warrants. This Agreement, the Security Agreement, the
Pledge Agreement and the Registration Rights Agreement constitute, and upon execution and delivery
by the Company of the Debentures and the Warrants, the Debentures and the Warrants will constitute,
legal, valid and binding obligations of the Company, enforceable in accordance with their
respective terms, except (a) as limited by applicable bankruptcy, insolvency, reorganization or
similar laws relating to or affecting the enforcement of creditors’ rights generally and (b) as
limited by equitable principles generally. The execution and delivery of the Transaction Documents
do not, and the performance of the Transaction Documents and the compliance with the provisions
hereof and thereof, including the issuance, sale and delivery of the Securities by the Company will
not, conflict with, or result in a breach or violation of the terms, conditions or provisions of,
or constitute a default under, or result in the creation or imposition of any lien pursuant to the
terms of, the Certificate or Bylaws of the Company, each as amended to date, or any statute, law,
rule or regulation or any state or federal order, judgment or decree or any indenture, mortgage,
lease or other agreement or instrument to which the Company or any of its properties is subject,
except for any conflict, breach, violation, default or imposition of a lien (other than pursuant to
the terms of the Certificate or Bylaws) that would not, individually or in the aggregate,
reasonably be expected to have a material adverse effect on the assets, liabilities, financial
condition, business or operations of the Company.



3.3 Issuance and Delivery of the Securities. The Securities are duly authorized and, when
issued at the Closing, will be validly issued, and the Common Stock underlying the Debentures, when
issued, will be fully paid and nonassessable. The Warrant Shares are duly authorized and, upon
exercise of the Warrants in accordance with the terms thereof, will be validly issued, fully paid
and nonassessable. The issuance and delivery of the Securities is not subject to any right of
first refusal, preemptive right, right of participation, or any similar right existing in favor of
any person or any liens or encumbrances. When issued in compliance with the provisions of this
Agreement and the Certificate, the issuance of the Securities hereunder does not require the
approval of the Company’s stockholders under the provisions of the Certificate or Delaware law, or,
any stock exchange or self-regulatory organization.



3.4 SEC Documents; Financial Statements. The Company has timely filed when due (or obtained
extensions in respect thereof and filed within the applicable grace period) all reports, schedules,
forms, statements and other documents required to be filed by it with the Securities and Exchange
Commission (the “SEC”) under the Securities Exchange Act of 1934, as amended (the
“Exchange Act”) during the twelve calendar months preceding the date hereof, including
material filed pursuant to Section 13(a) or 15(d) of the Exchange Act (all of the foregoing
including filings incorporated by reference therein being referred to herein as the



 


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“SEC Documents”. The Company has delivered or made available to the Purchasers via
EDGAR or another Internet web-site true and complete copies of the SEC Documents. As of their
respective filing dates, all SEC Documents complied in all material respects with the requirements
of the Exchange Act. None of the SEC Documents as of their respective dates contained any untrue
statement of material fact or omitted to state a material fact required to be stated therein or
necessary to make the statements made therein, in light of the circumstances under which they were
made, not misleading. The financial statements of the Company included in the SEC Documents (the
“Financial Statements”) comply in all material respects with applicable accounting
requirements and with the published rules and regulations of the SEC with respect thereto. The
Financial Statements have been prepared in accordance with generally accepted accounting principles
consistently applied and fairly present the consolidated financial position of the Company and its
subsidiaries, if any, at the dates thereof and the consolidated results of their operations and
consolidated cash flows for the periods then ended (subject, in the case of unaudited statements,
to normal, recurring adjustments or to the extent that such unaudited statements do not include
footnotes).



3.5 Governmental Consents. No consent, approval, order or authorization of, or registration,
qualification, designation, declaration or filing with, any federal, state, or local governmental
authority on the part of the Company is required in connection with the consummation of the
transactions contemplated by this Agreement except for filing of a Form D with respect to the
Securities as required under Regulation D and notice filings required pursuant to applicable “blue
sky” laws in the states in which the Securities are offered and/or sold. The Company shall take all
other necessary action and proceedings as may be required and permitted by applicable law, rule and
regulation, for the legal and valid issuance of the Securities in compliance with such laws.



3.6 Capitalization.



(a) The authorized capital stock of the Company consists of 100,000,000 shares of Common Stock
of which, as of the date immediately prior to Closing, 10,979,699 shares were issued and
outstanding, and



(b) Except (i) as disclosed to the Purchasers in Schedule 3.6 of the “Exceptions
Schedule,” attached hereto as Exhibit “B” and made a part hereof, or (ii) as contemplated
herein, there are no outstanding warrants, options, convertible or exchangeable securities or other
rights, agreements or arrangements of any character under which the Company is or may be obligated
to issue any equity securities of any kind.



3.7 Litigation. Except as disclosed to the Purchasers in writing and except as disclosed in
the SEC Documents, there are no actions, suits, proceedings or investigations pending or, to the
best of the Company’s knowledge, threatened against the Company or any of its properties before or
by any court or arbitrator or any governmental body, agency or official in which there is a
reasonable likelihood (in the reasonable judgment of the Company) of an adverse decision that (a)
could have a material adverse effect on the assets, liabilities, financial condition, business or
operations of the Company, or (b) could impair the ability of the Company to perform in any
material respect its obligations under this Agreement, the Debentures or the Warrants or any other
Transaction Document.


 


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3.8 Company not an “Investment Company". The Company has been advised by competent counsel of
the rules and requirements under the Investment Company Act of 1940, as amended (the “Investment Company Act”). The Company is not, and immediately after
receipt of payment for the Securities will not be, an “investment company” or an entity
“controlled” by an “investment company” within the meaning of the Investment Company Act and shall
conduct its business in a manner so that it will not become subject to the Investment Company Act.



3.9 Compliance. The Company’s Common Stock is registered pursuant to Section 12(g) of the
Exchange Act and is listed on the American Stock Exchange (the “AMEX”), and the Company has
taken no action designed for the purpose of, or likely to have the effect of, terminating the
registration of its Common Stock under the Exchange Act or de-listing the Common Stock from the
AMEX, nor has the Company received any notification that the SEC or the AMEX is contemplating
terminating such registration or listing. The Company is in material compliance with the listing
and maintenance requirements for continued listing of the Common Stock on the AMEX.



3.10 Use of Proceeds. The proceeds of the sale of the Securities shall be used to pay off (or
acquire, to the extent structured as a debt acquisition for Investors’ collateral purposed) all
current bank debt, including that of Silicon Valley Bank. Any remaining proceeds shall be used for
general corporate purposes.



3.11 Brokers and Finders. Except as otherwise disclosed to the Purchasers in writing prior to
the date hereof, no person or entity will have, as a result of or in connection with the
transactions contemplated by this Agreement, any valid right, interest or claim against or upon the
Company or any Purchaser for any commission, fee or other compensation pursuant to any agreement,
arrangement or understanding, written or oral, entered into by or on behalf of the Company.




3.12 Intellectual Property.



(a) “Intellectual Property” shall mean patents, patent applications, trademarks,
trademark applications, service marks, trade names, copyrights, trade secrets, licenses,
information and other proprietary rights and processes.



(b) Except as disclosed in the SEC Documents and to the best knowledge of the Company, the
Company owns or has the valid right to use all of the Intellectual Property that is necessary for
the conduct of the Company’s business as currently conducted or as currently proposed to be
conducted free and clear of all material liens and encumbrances.



(c) Except as disclosed to the Purchasers in writing or as disclosed in the SEC Documents and
to the knowledge of the Company, (i) the conduct of the Company’s business as currently conducted
does not infringe or otherwise conflict with (collectively, “Infringe”) any Intellectual
Property rights of any third party or any confidentiality obligation owed by the Company to a third
party and the Company has not received any written notice of any such Infringement, and (ii) the
Intellectual Property and confidential information of the Company are not being Infringed by any
third party.



(d) Each employee, consultant and contractor of the Company who has had access to confidential
information of the Company which is necessary for the conduct of Company’s business as currently
conducted or as currently proposed to be conducted has executed an agreement to maintain the
confidentiality of such confidential information and has executed agreements that are substantially
consistent with the Company’s standard forms thereof.


 


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3.13 Questionable Payments. Neither the Company nor, to the best knowledge of the Company,
any of its current or former stockholders, directors, officers, employees, agents or other persons
acting on behalf of the Company, has on behalf of the Company or in connection with its business:
(a) used any corporate funds for unlawful contributions, gifts, entertainment or other unlawful
expenses relating to political activity; (b) made any direct or indirect unlawful payments to any
governmental officials or employees from corporate funds; (c) established or maintained any
unlawful or unrecorded fund of corporate monies or other assets; (d) made any false or fictitious
entries on the books and records of the Company; or (e) made any unlawful bribe, rebate, payoff,
influence payment, kickback or other unlawful payment of any nature.



3.14 Transactions with Affiliates. Except as disclosed in the SEC Documents, none of the
officers, directors or shareholders of the Company and, to the best knowledge of the Company, none
of the employees of the Company is presently a party to any transaction with the Company or to a
presently contemplated transaction (other than for services as employees, officers and directors)
that would be required to be disclosed pursuant to Item 404 of Regulation S-B promulgated under the
Securities Act of 1933.



3.15 Insurance. The Company maintains and will continue to maintain insurance with
financially sound and reputable insurers in such amounts and covering such risks and in such
amounts as are reasonably adequate, prudent and consistent with industry practice for the conduct
of its business and the value of its property, all of which insurance is in full force and effect.
The Company has not received notice from, and has no knowledge of any threat by, any insurer that
has issued any insurance policy to the Company that such insurer intends to deny coverage under or
cancel, discontinue or not renew any insurance policy in force as of the date hereof.



3.16 No Additional Agreements. The Company does not have any agreement or understanding with
any Purchaser with respect to the transactions contemplated by this Agreement other than as
specified in this Agreement.



3.17 Absence of Undisclosed Liabilities. The Company has no material liabilities of any
nature (whether absolute, accrued, contingent or otherwise), except (i) as and to the extent
reflected in the Financial Statements as of and for the fiscal year ended December 31, 2007, and
(ii) for liabilities that have been incurred in the ordinary course of business consistent with
past practice since December 31, 2007 and that would not, individually and in the aggregate,
reasonably be expected to have a material adverse effect on the assets, financial condition,
business or operations of the Company.



3.18 Governmental Authorizations. The Company has all permits, licenses and other
authorizations of governmental authorities that are required for the conduct of its business and
operations as currently conducted or as currently proposed to be conducted, the lack of which could
materially and adversely affect the assets, financial condition, business or operations of the
Company, except as described in the SEC Documents. The Company is, and at all times has been, in
compliance with the provisions of its material permits, licenses and other governmental
authorizations.



3.19 No Material Adverse Change. Except as otherwise disclosed herein or in the SEC
Documents, since December 31, 2007, there have not been any changes in the assets, liabilities,
financial condition or operations of the Company from that reflected in the Financial Statements
except changes in the ordinary course of business which have not been, either individually or in the aggregate, materially adverse. The Company does not have pending before the SEC any
request for confidential treatment of information.


 


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3.20 Reservation. The Company has duly reserved for issuance such number of shares of Common
Stock as may be issuable from time to time upon exercise or conversion, as the case may be, of the
Securities.



3.21 Internal Accounting Controls. The Company maintains a system of internal accounting
controls sufficient to provide reasonable assurance that (i) transactions are executed in
accordance with management’s general or specific authorizations, (ii) transactions are recorded as
necessary to permit preparation of financial statements in conformity with GAAP and to maintain
asset accountability, (iii) access to assets is permitted only in accordance with management’s
general or specific authorization, and (iv) the recorded accountability for assets is compared with
the existing assets at reasonable intervals and appropriate action is taken with respect to any
differences. The Company has established disclosure controls and procedures (as defined in
Exchange Rules 13a-15 and 15d-15) for the Company and designed such disclosure controls and
procedures to ensure that material information relating to the Company is made known to the
certifying officers by others within those entities, particularly during the period in which the
Company’s Form 10-K or 10-Q, as the case may be, is being prepared.



3.22 Title to Assets. Except as disclosed to Purchasers in Schedule 3.22 of the Exceptions
Schedule attached as Exhibit “B,” the Company has good and marketable title in fee simple to all
real property owned by it that is material to the business of the Company and good and marketable
title in all tangible personal property owned by them that is material to the business of the
Company in each case free and clear of all liens, except for liens identified in Schedule 3.22 or
as do not materially affect the value of such property and do not materially interfere with the use
made and proposed to be made of such property by the Company, and liens for the payment of federal,
state or other taxes, the payment of which is neither delinquent nor subject to penalties. Any
real property and facilities held under lease by the Company is held by it under valid, subsisting
and enforceable leases with which the Company is in material compliance.



3.23 Registration Rights. Except as disclosed to the Purchasers in Schedules 3.23, the
Company has not granted or agreed to grant to any person any rights (including “piggy back”
registration rights) to have any securities of the Company registered with the SEC or any other
governmental authority.



3.24 Material Non-Public Information. The Company confirms that it has not provided any of
the Purchasers or their agents or counsel with any information that constitutes or might constitute
material non-public information as of the Closing Date (other than with respect to the transactions
contemplated by this Agreement). The Company understands and confirms that the Purchasers shall be
relying on the foregoing representations in effecting transactions in securities of the Company.


 


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ARTICLE 4




REPRESENTATIONS, WARRANTIES AND COVENANTS OF THE PURCHASERS




Each Purchaser hereby severally represents and warrants to the Company:



4.1 Authorization. (a) Purchaser has all requisite legal and corporate or other power and
capacity and has taken all requisite corporate or other action to execute and deliver this
Agreement, the Security Agreement, the Pledge Agreement, the Registration Rights Agreement to
purchase the Debentures and the Warrants to be purchased by it and to carry out and perform all of
its obligations under this Agreement and the other Transaction Documents, and (b) this Agreement
and the other Transaction Documents to which a Purchaser is a party constitutes the legal, valid
and binding obligation of such Purchaser, enforceable in accordance with its terms, except (i) as
limited by applicable bankruptcy, insolvency, reorganization, or similar laws relating to or
affecting the enforcement of creditors’ rights generally and (ii) as limited by equitable
principles generally.



4.2 No Legal, Tax or Investment Advice. Purchaser understands that nothing in this Agreement
or any other materials presented to Purchaser in connection with the purchase and sale of the
Debentures and the Warrants constitutes legal, tax or investment advice. Purchaser has consulted
such legal, tax and investment advisors as it, in its sole discretion, has deemed necessary or
appropriate in connection with its purchase of the Debentures.



4.3 Purchaser’s Status. Each Purchaser is an “accredited investor” as defined in
Regulation D promulgated under the Securities Act. Such Purchaser is not required to be registered
as a broker-dealer under Section 15 of the Exchange Act and such Purchaser is not a broker-dealer.
Purchaser understands that the Securities must be held indefinitely unless such Securities are
registered under the Securities Act or an exemption from registration is available and confirms
that Purchaser is familiar with Rule 144 of the rules and regulations of the Commission, as
amended, promulgated pursuant to the Securities Act (“Rule 144”), and that Purchaser has
been advised that Rule 144 permits resales only under certain circumstances. Such Purchaser
understands that to the extent that Rule 144 is not available, such Purchaser will be unable to
sell any Securities without either registration under the Securities Act or the existence of
another exemption from such registration requirement. Purchaser understands that the Securities
are being offered and sold in reliance on an exemption from the registration requirement of Federal
and state securities laws and the Company is relying upon the truth and accuracy of the
representations, warranties, agreements, acknowledgments and understandings of Purchaser set forth
herein in order to determine the applicability of such exemptions and the suitability of such
Purchaser to acquire the Securities.



4.4 Short Sales. Each Purchaser has not, during the last thirty (30) days prior to the
date hereof, directly or indirectly, nor has any party acting on behalf of or pursuant to any
understanding with such Purchaser, effected or agreed to effect any short sale, whether or not
against the box, established any “put equivalent position” (as defined in Rule 16(a)-1(h) under the
Exchange Act) with respect to any security of the Company, granted any other right (including,
without limitation, any put or call option) with respect to any security of the Company or with
respect to any security that includes, relates to, or derives any significant part of its value
from any security of the Company or otherwise sought to hedge its positioning of the Company’s
securities. Each Purchaser shall not, and shall cause any affiliates not to, engage, directly or
indirectly, in any hedging or short sale transactions in the securities of the Company (including,
without limitation, any short sales) involving the Company’s securities during the period from the
date hereof until one (1) year after the effectiveness of any registration statement filed by the
Company covering the Common Stock underlying the Securities.


 


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ARTICLE 5




ADDITIONAL AGREEMENTS OF THE COMPANY




5.1 Securities Laws Disclosure; Publicity. The Company shall, by 8:30 a.m. Eastern time on
the third business day following the date of this Agreement, issue a press release or file a
Current Report on Form 8-K, in each case reasonably acceptable to the Majority in Interest on
behalf of the Purchasers, disclosing the transactions contemplated hereby. The Company and the
Majority in Interest shall consult with each other in issuing any press releases with respect to
the transactions contemplated hereby, and none of the Company, the Majority in Interest, or any
Purchaser shall issue any such press release or otherwise make any such public statement without
the prior consent of the Company (in the case of any press release or public statement proposed to
be issued by the Majority in Interest or any Purchaser) or without the prior consent of the
Majority in Interest on behalf of the Purchasers (in the case of any press release or public
statement proposed to be issued by the Company), which consent shall not unreasonably be withheld,
except if such disclosure is required by law, in which case the disclosing party shall promptly
provide the other party with notice of such public statement or communication and consult with each
other with respect thereto prior to such public disclosure. Notwithstanding the foregoing, other
than as set forth above, the Company shall not publicly disclose the name of any Purchaser, or
include the name of any Purchaser in any filing with the Commission or any regulatory agency or
stock exchange, except to the extent such disclosure is required by law or stock exchange
regulation, in which case the Company shall provide the Purchasers with prior notice of such
disclosure.



5.2 Listing of Common Stock. The Company hereby agrees to use commercially reasonable efforts
to secure and maintain the listing on the AMEX of the Common Stock underlying the Securities sold
hereunder. The Company further agrees, if the Company applies to have its Common Stock traded on
any other stock exchange or quotation system, it will include in such application the Common Stock
issuable upon conversion of the Debentures or exercise of the Warrants, and will take such other
action as is necessary or desirable in the opinion of the Purchasers to cause the Common Stock
underlying the Securities to be listed on such other stock exchange or quotation system as promptly
as possible.



5.3 All Assets Free and Clear. As a condition to Closing, the Company shall deliver to
Purchaser (as “Lender” pursuant to the Debentures) UCC lien searches, judgment searches, federal
and local tax lien searches and all other documents reasonably requested by Lender to demonstrate
that any and all assets with respect to which Lender is acquiring or being granted a security
interest are free and clear of all liens, claims and encumbrances, except as specifically noted on
Schedule 3.22 of the Exceptions Schedule or to the extent any liens, claims and encumbrances shall
be acquired as security for the benefit of Lender or satisfied from the proceeds of this
transaction.



ARTICLE 6




MISCELLANEOUS




6.1 Waivers and Amendments. The terms of this Agreement may be waived or amended only upon
the written consent of the Company and the Majority in Interest.


 


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6.2 Governing Law. This Agreement shall be governed in all respects by and construed in
accordance with the laws of the State of New York without any regard to conflicts of laws
principles.



6.3 Survival. The representations, warranties, covenants and agreements made in this
Agreement shall survive any investigation made by the Company or the Purchasers and the Closing.



6.4 Successors and Assigns. No Purchaser shall assign this Agreement without the prior
written consent of the Company.



6.5 Entire Agreement. This Agreement and the other Transaction Documents constitute the full
and entire understanding and agreement between the parties with regard to the subjects thereof.



6.6 Notices, etc. All notices and other communications required or permitted under this
Agreement shall be in writing and may be delivered in person, by telecopy, overnight delivery
service or registered or certified United States mail, addressed to the Company or each of the
Purchasers, as the case may be, at their respective addresses set forth at the beginning of this
Agreement or on Exhibit A, or at such other address as the Company, on the one hand, or a
Purchaser, on the other hand, shall have furnished to the other party in writing. All notices and
other communications shall be effective upon the earlier of actual receipt thereof by the person to
whom notice is directed or (a) in the case of notices and communications sent by personal delivery
or telecopy, one business day after such notice or communication arrives at the applicable address
or was successfully sent to the applicable telecopy number, (b) in the case of notices and
communications sent by overnight delivery service, at noon (local time) on the second business day
following the day such notice or communication was sent, and (c) in the case of notices and
communications sent by United States mail, seven days after such notice or communication shall have
been deposited in the United States mail.



6.7 Severability of this Agreement. If any provision of this Agreement shall be judicially
determined to be invalid, illegal or unenforceable, the validity, legality and enforceability of
the remaining provisions shall not in any way be affected or impaired thereby.



6.8 Counterparts; Signatures by Facsimile. This Agreement may be executed in any number of
counterparts, each of which shall be an original, but all of which together shall constitute one
instrument. This Agreement, once executed by a party, may be delivered to the other parties hereto
by facsimile transmission of a copy of this Agreement bearing the signature of the party so
delivering this Agreement.



6.9 Further Assurances. Each party to this Agreement shall do and perform or cause to be done
and performed all such further acts and things and shall execute and deliver all such other
agreements, certificates, instruments and documents as the other party hereto may reasonably
request in order to carry out the intent and accomplish the purposes of this Agreement and the
consummation of the transactions contemplated hereby.



6.10 Expenses. Each party shall bear its own expenses, except that the Company agrees to pay
Professional Offshore Opportunity Fund, Ltd. and Professional Traders Fund, LLC for their legal
expenses and counsel fees with respect to this Agreement and the transactions contemplated in the
aggregate amount of $30,000 and agrees to pay Professional Traders Management, LLC the sum of $25,000 as a non-accountable due diligence fee. Expenses under
this provision shall be paid at Closing.


 


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6.11 Replacement of Securities. If any certificate or instrument evidencing any Securities is
mutilated, lost, stolen or destroyed, the Company shall issue or cause to be issued in exchange and
substitution for and upon cancellation thereof, or in lieu of and substitution therefore, a new
certificate or instrument, but only upon receipt of evidence reasonably satisfactory to the Company
of such loss, theft or destruction and customary and reasonable indemnity, if requested. The
applicants for a new certificate or instrument under such circumstances shall also pay any
reasonable third-party costs associated with the issuance of such replacement Securities.


 


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IN WITNESS WHEREOF, this Agreement is hereby executed as of the date first above written.



	 	 	 	 	 
	 	SMART MOVE, INC.

 	 
	 	By:  	 	 
	 	 	Name:  	 	 
	 	 	Title:  	 	 
	 
	 	PROFESSIONAL OFFSHORE
OPPORTUNITY FUND, LTD.

 	 
	 	By:  	 	 
	 	 	Name:  	 	 
	 	 	Title:  	 	 
	 
	 	PROFESSIONAL TRADERS FUND, LLC

 	 
	 	By:  	 	 
	 	 	Name:  	 	 
	 	 	Title:  	 	 
	 
	 	PURCHASER DESIGNATED BY SMART MOVE, INC.

 	 
	 	By:  	 	 
	 	 	Name:  	 	 
	 	 	Title:  	 	 
	 



 


12









 





EXHIBIT A




SCHEDULE OF PURCHASERS




	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	Common	 
	 	 	Principal Amount	 	 	Shares Underlying	 
	PURCHASER	 	of Debenture	 	 	Warrant	 
	Professional Offshore Opportunity Fund, Ltd.

1400 Old Country Road

Suite 206

Westbury, New York 11590
	 	$	2,800,000	 	 	1,866,666 shares
	Professional Traders Fund, LLC.

1400 Old Country Road

Suite 206

Westbury, New York 11590
	 	$	200,000	 	 	133,333 shares
	Other Investor to be Designated by
Smart Move, Inc.
	 	$	500,000	 	 	333,333 shares
	 
	 	 	 	 	 	 	 	 
	Total
	 	$	3,500,000	 	 	2,333,332 shares








 


13









 







EXHIBIT “B”




EXCEPTIONS SCHEDULE