Exhibit
10.1


 


Execution
Copy


 


iBASIS,
INC.


 


SECURITIES
PURCHASE AGREEMENT


 


This
SECURITIES PURCHASE AGREEMENT (this “Agreement”),
dated as of September 24, 2004, 2004, is by and among iBASIS, INC., a Delaware
corporation (the “Company”), and each of
the investors listed on Schedule I hereto (each of the persons or entities
listed on Schedule I,
individually, a “Purchaser” and,
collectively, the “Purchasers”).


 


WHEREAS, the Company desires
to issue and sell to the Purchasers, and the Purchasers desire to purchase from
the Company, an aggregate of 15,000,000 shares (the “Shares”) of the authorized but unissued shares of the Company’s
common stock, $0.001 par value per share (including any securities into which
or for which such shares may be exchanged for, or converted into, pursuant to
any stock dividend, stock split, stock combination, recapitalization,
reclassification, reorganization or other similar event, the “Common Stock”), at an aggregate purchase
price of $31,500,000, all upon the terms and subject to the conditions set
forth in this Agreement; and


 


WHEREAS, simultaneously with
entering into this Agreement, the Company and the Purchasers are entering into
that certain Registration Rights Agreement, dated as of the date hereof (the “Registration Rights Agreement”), pursuant to which the Company will assume
obligations with respect to the registration of the Shares and the Warrant
Shares (as defined below) on the terms set forth therein.


 


NOW THEREFORE, in
consideration of the mutual agreements, representations, warranties and
covenants herein contained, the parties hereto agree as follows:


 


1              Definitions; Certain Rules of Construction.  As used in this Agreement, the following
terms shall have the following respective meanings:


 


“Affiliate”
means, with respect to any Person, any other Person directly or indirectly
controlling or controlled by or under direct or indirect common control with
such specified Person.  For the purposes
of this Agreement, “control,” when used with respect to any specified Person means
the power to direct or cause the direction of the management and policies of
such Person, directly or indirectly, whether through the ownership of voting
securities, by contract or otherwise; and the terms “controlling” and
“controlled” have meanings correlative to the foregoing.


 


“Board” means the board of directors of the
Company.


 


“business day” (whether such term is
capitalized or not) means any day except Saturday, Sunday and any day
which shall be a federal legal holiday or a day on which banking institutions
in the State of New York are authorized or required by law or other
governmental action to close.


 


“Closing Date” means the date hereof.


 


“Code”
means the Internal Revenue Code of 1986.


 


“Convertible Notes” means the Company’s
53⁄4% Convertible Subordinated Notes due 2005, 63⁄4% Convertible Subordinated Notes
due 2009 and 8% Secured Convertible Notes due 2007.


 


“Environmental
Protection Laws” means any law, statute or regulation enacted by any
jurisdiction in connection with or relating to the protection or regulation of
the environment, including,


 


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without limitation, those laws,
statutes and regulations regulating the disposal, removal, production, storing,
refining, handling, transferring, processing or transporting of hazardous or
toxic substances, and any orders, decrees or judgments issued by any court of
competent jurisdiction in connection with any of the foregoing.


 


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


 


“ERISA
Affiliate” means any Person required to be aggregated with the Company or
any Subsidiary of the Company under Sections 414(b), (c), (m) or (o) of the
Code.


 


“Exchange Act” means the Securities Exchange
Act of 1934, as amended, and all of the rules and regulations promulgated
thereunder.


 


“Exchange Act
Reports” means the Company’s reports filed with the SEC since December 31,
2003, pursuant to Section 13 of the Exchange Act.


 


“Governmental
Authority” means any nation or government, any state or other political
subdivision thereof and any entity exercising executive, legislative, judicial,
regulatory or administrative functions of or pertaining to government.


 


“Indebtedness”
means, as applied to any Person, all
indebtedness for borrowed money, whether current or funded, or secured or
unsecured.


 


“Lien”
means, with respect to any property or asset, any mortgage, lien, pledge,
charge, security interest or encumbrance of any kind in respect of such
property or asset, whether or not filed, recorded or otherwise perfected under
applicable law, other than (a) those resulting from taxes which have not yet
become delinquent, (b) minor liens and encumbrances that do not materially
detract from the value of the property or materially impair the operations of
the Company, (c) those relating to Indebtedness incurred prior to the date
hereof and any replacement thereof, or (d) those which have otherwise arisen in
the ordinary course of business consistent with past practice.


 


“Majority Purchasers” means Purchasers
holding, at any time, a majority of the outstanding Shares on such date.


 


“Material Adverse Effect” means a
material adverse effect on the business, assets, liabilities, properties,
operations, prospects or condition (financial or otherwise) of the Company and
its Subsidiaries taken as a whole.


 


“Margin Stock”
is defined in Regulation U of the Board of Governors of the Federal Reserve
System.


 


“Person” (whether or not capitalized) means an
individual, entity, partnership, limited liability company, corporation, association,
trust, joint venture, unincorporated organization, and any government,
governmental department or agency or political subdivision thereof.


 


“PBGC”
means the Pension Benefit Guaranty Corporation.


 


“Plan”
means any employee benefit plan, program or arrangement, whether oral or
written, maintained or contributed to by the Company, any Subsidiary of the
Company or any ERISA Affiliate, or with respect to which the Company, any
Subsidiary of the Company or any ERISA Affiliate may incur liability.


 


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“Registration
Statements” means the Company’s registration statements filed with the SEC
since December 31, 2003, pursuant to the Securities Act.


 


“Rule 144” means Rule 144 promulgated under the
Securities Act and any successor or substitute rule, law or provision.


 


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


 


“SEC
Reports” means the Exchange Act Reports and the Registration Statements.


 


“Securities Act” means the Securities Act
of 1933, as amended, and all of the rules and regulations promulgated
thereunder.


 


“Senior
Loan Agreement” means that certain credit agreement, as amended, restated
or supplemented from time to time, by and among the Company, iBasis Global,
Inc. and Silicon Valley Bank.


 


“Subsidiary”
means with respect to any Person at any time, (a) any other Person the accounts
of which would be consolidated with those of such first Person in its
consolidated financial statements as of such time, and (b) any other Person (i)
which is, at such time, controlled by, or (ii) capital securities of which
having ordinary voting power to elect a majority of the board of directors (or
other persons having similar functions), or other ownership interest of which
ordinarily constituting a majority voting interest, are at such time, directly
or indirectly, owned or controlled by, in the case of each of clauses (i) and
(ii), such first Person or one or more of its Subsidiaries or by such first
Person and one or more of its Subsidiaries. 
Unless otherwise expressly provided, all references herein to
“Subsidiary” means a Subsidiary of the Company.


 


“Transaction Documents” means,
collectively, the Registration Rights Agreement and the Warrants.


 


“Transfer
Agent  Instruction  Letter” means the letter, dated as of
the Closing Date, from the Company to its transfer agent in the form attached
hereto as Exhibit  F.


 


“Warrant Shares” means the shares of
Common Stock issued or issuable upon the exercise of the Warrants.


 


“in writing” means any form of written communication
or a communication by means of telex, facsimile transmission, telegraph or
cable.


 


The following
table sets forth certain other defined terms and the section of this Agreement
in which the meaning of each such term appears:


 


 


	
   

  	
   

  	
  Section(s)

  
	
  “Aggregate Purchase Price”

  	
   

  	
  2.1

  
	
  “Agreed
  Amount”

  	
   

  	
  7.2(b)

  
	
  “Agreement”

  	
   

  	
  Preamble

  
	
  “Claim Notice”

  	
   

  	
  7.2(a)

  



 


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  Section(s)

  
	
  “Claimed Amount”

  	
   

  	
  7.2(a)

  
	
  “Closing”

  	
   

  	
  2.2

  
	
  “Common Stock”

  	
   

  	
  Preamble

  
	
  “Company”

  	
   

  	
  Preamble

  
	
  “Indemnified
  Party”

  	
   

  	
  7.2(b)

  
	
  “Losses”

  	
   

  	
  7.1

  
	
  “Permits”

  	
   

  	
  3.19(b)

  
	
  “Purchase Price Per Share”

  	
   

  	
  2.1

  
	
  “Purchaser”

  	
   

  	
  Preamble

  
	
  “Purchaser
  Indemnitee”

  	
   

  	
  7.1

  
	
  “Registration Rights Agreement”

  	
   

  	
  Preamble

  
	
  “Response
  Notice”

  	
   

  	
  7.2(b)

  
	
  “Shares”

  	
   

  	
  Preamble

  
	
  “Warrant(s)”

  	
   

  	
  2.3

  



 


2              Purchase
and Sale of Shares.


 


2.1              Purchase
and Sale. Subject to and upon the terms and conditions set forth in this
Agreement, the Company agrees to issue and sell to each Purchaser, and each
Purchaser hereby agrees, severally and not jointly, to purchase from the
Company, at the Closing, the number of Shares set forth opposite such
Purchaser’s name on Schedule I hereto, at a purchase price equal to $2.10
per share (the “Purchase  Price Per  Share”). The aggregate
purchase price payable by the Purchasers to the Company for all of the Shares
shall be $31,500,000 (the “Aggregate Purchase Price”).


 


2.2              Closing.
The closing of the transactions contemplated under this Agreement (the “Closing”) shall take place at 5:00 pm (Eastern
Time) at the offices of Bingham McCutchen LLP, 399 Park Avenue, New York, New
York 10022-4689, on the Closing Date, or on such other date and at such time as
may be agreed upon between the Purchasers, on the one hand, and the Company, on
the other hand.  At the Closing, the
Company shall deliver to each Purchaser a single stock certificate, registered
in the name of such Purchaser, representing the number of Shares purchased by
such Purchaser, against payment of the purchase price by wire transfer of
immediately available funds to such account as the Company shall designate in
writing, which stock certificate shall bear the legend set forth in Section
6.2(a).  The stock certificates delivered
to the Purchasers and representing the Shares will be registered in the names
and addresses of the Purchasers set forth on Schedule  I hereto.


 


2.3              Issuance of Common Stock Purchase Warrants at Closing.  Subject to and upon the terms and conditions
set forth in this Agreement, the Company agrees to issue to each Purchaser, at
the Closing, a Common Stock Purchase Warrant, substantially in the form
attached as Exhibit  A hereto (each individually, a “Warrant”
and, collectively with all Common Stock Purchase Warrants issued pursuant to
this Section 2.3 to the other Purchasers, the “Warrants”), exercisable for
the number of shares of Common Stock set forth opposite the name of such
Purchaser under the heading “Number of Warrant Shares” on Schedule
I hereto, at an exercise price equal to the Purchase Price Per
Share.  No additional consideration


 


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shall be payable by any
Purchaser in respect of the issuance by the Company of such Purchaser’s Warrant
at the Closing.


 


3              Representations
and Warranties of the Company.  In
order to induce the Purchasers to enter into this Agreement and to purchase the
Shares, the Company hereby makes the following representations and warranties
as of the Closing Date, all of which shall survive the execution and delivery
of this Agreement and the purchase of the Shares for a period ending on the
third anniversary of the Closing Date, provided, that the
representations and warranties made under Section 3.5 of this Agreement shall
survive indefinitely:


 


3.1              Corporate
Status.  The Company and each of its
Subsidiaries (a) is a duly organized and validly existing corporation in good
standing under the laws of the jurisdiction of its organization and has the
corporate power and authority to own its property and assets and to transact
the business in which it is engaged and presently proposes to engage and (b)
has duly qualified to do business and is in good standing in each jurisdiction
where it is required to be so qualified and where the failure to be so
qualified is reasonably likely to have a Material Adverse Effect.  Neither the Company nor any of its
Subsidiaries is currently in violation of any of the provisions of its
Certificate of Incorporation (or other charter document) or By-laws, each as
amended to date.


 


3.2              Corporate
Power and Authority.  All corporate
action on the part of the Company, its officers and directors necessary for the
authorization, execution, delivery and performance of this Agreement and the
Transaction Documents and the consummation of the transactions contemplated
herein and therein has been taken. When executed and delivered by the Company,
this Agreement and each of the Transaction Documents shall constitute a legal,
valid and binding obligation of the Company, enforceable against the Company in
accordance with its terms, except as such may be limited by bankruptcy,
insolvency, reorganization or other laws affecting creditors’ rights generally
and by general equitable principles. The Company has all requisite corporate
power and authority to enter into this Agreement and the Transaction Documents
and to carry out and perform its obligations under their respective terms.


 


3.3              No
Violation.  Neither the execution,
delivery and performance by the Company this Agreement and the Transaction
Documents nor compliance with the terms and provisions thereof (a) will contravene
any applicable provision of any law, statute, rule, regulation, order, writ,
injunction or decree of any court or governmental instrumentality, except as
would not have a Material Adverse Effect, (b) will conflict or be inconsistent
with or result in any breach of, any of the material terms, covenants,
conditions or provisions of, or constitute a default under, or result in the
creation or imposition of (or the obligation to create or impose) any Lien upon
any of the property or assets of the Company pursuant to the terms of, any
indenture, mortgage, deed of trust, agreement or other instrument to which the
Company or any of its Subsidiaries is a party or by which it or any of its
property or assets are bound or to which it may be subject or result in the
acceleration of any material obligation of the Company, or (c) will violate any
provision of the Certificate of Incorporation or by-laws of the Company, each
as amended to date.


 


3.4              Capitalization.
As of the date hereof, the authorized capital stock of the Company consists of
170,000,000 shares of Common Stock, of which 45,648,703 shares are issued and
outstanding, and 15,000,000 shares of undesignated preferred stock, $0.001 par
value per share, none of which are issued and outstanding. As of the date
hereof, (i) 6,790,624 shares of Common Stock were reserved for future issuance
pursuant to outstanding options issued by the Company, (ii) 8,413,349 shares of
Common Stock were reserved for future issuance pursuant to outstanding warrants
issued by the Company and (iii) 35,840,119 shares of Common Stock were reserved
for future issuance upon conversion of the Convertible Notes.  As of the date hereof, except as set forth
above and for the exercise rights of the warrants and the conversion rights of
the Convertible Notes, and except as set forth on Schedule 3.4


 


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attached hereto, there are no
other outstanding options, warrants, rights (including conversion or preemptive
rights) or any agreement for the purchase or acquisition from the Company of
any shares of the Company’s capital stock or voting agreements with respect to
equity of the Company. All shares of the capital stock of the Company subject
to issuance as aforesaid, upon issuance on the terms and conditions specified
in the instruments pursuant to which they are issuable, shall be duly
authorized, validly issued, fully paid and nonassessable. There are no
obligations, contingent or otherwise, of the Company to repurchase, redeem or
otherwise acquire any shares of Common Stock or to provide funds to or make any
investment (in the form of a loan, capital contribution, guaranty or otherwise)
in any other entity.  The sale of the
Shares and the issuance of the Warrants under this Agreement, and the issuance
of any Warrant Shares upon exercise of the Warrants in their current form, will
not result in the Company being obligated to issue, sell or purchase, pursuant
to any existing pre-emptive, anti-dilution, redemption or other right of third
parties, shares of Common Stock or other securities to or from any Person
(other than the Purchasers), and will not result in a right of any holder of
convertible or contingent securities issued by the Company to adjust the
exercise, conversion, exchange or reset price under such securities, including,
in any such case, pursuant to any “poison pill” or shareholders rights
plan.  None of the outstanding shares of
capital stock of the Company were issued in violation of the Securities Act or
any state securities laws.


 


3.5              Valid
Issuance of the Shares. The Shares, the Warrants and the Warrant Shares
have been duly authorized, and the Shares and the Warrant Shares, upon issuance
pursuant to the terms hereof and the terms of the Warrants, respectively, (a)
will be validly issued, fully paid and nonassessable, (b) will not be subject
to any encumbrances, preemptive rights or any other similar contractual rights
of the stockholders of the Company or any other Person, and (c) the applicable
Purchaser (with respect to the Shares) and the applicable Holder (as defined in
the Warrant) will obtain sole record ownership of such Shares and Warrant
Shares (as applicable) and take good marketable title thereto, free and clear
of any Liens (defined for purposes hereof without regard to the carve-outs set
forth in clauses (a) through (d) of the definition of Lien), claims, charges,
taxes, options or transfer restrictions of any kind which are imposed by the
Company, or arise as a result of the Company’s action or omission, other than
those explicitly set forth in this Agreement and in the Warrants. The Company
has reserved from its duly authorized capital stock the number of shares of
Common Stock issuable upon execution of this Agreement and upon exercise in
full of the Warrants (assuming the Warrants vest in full).


 


3.6              Litigation.  Except as disclosed in the SEC Reports, no
actions, suits or proceedings are pending or, to the Company’s knowledge,
threatened that are reasonably likely to have (a) a Material Adverse Effect or
(b) an adverse effect on the rights or remedies of the Purchasers or on the
ability of the Company or its Subsidiaries to perform their respective
obligations under this Agreement.


 


3.7              Approvals.  Except for any required filings and
recordings which have been made and are in full force and effect, no order,
consent, approval, license, authorization or validation of, or filing,
recording or registration with, or exemption by, any Person or Governmental
Authority, is required to authorize or is required in connection with (a) the
execution, delivery and performance of this Agreement or the Transaction
Documents or (b) the legality, validity, binding effect or enforceability of
this Agreement or the Transaction Documents. 
The execution and delivery by the Company of this Agreement and the
Transaction Documents, the consummation of the transactions contemplated herein
and therein, and the issuance of the Shares and the Warrants and, upon exercise
of the Warrants, the Warrant Shares, do not require the consent or approval of
the stockholders of the Company or any other Person.


 


3.8              Contracts.  All material agreements to which the Company
is a party or to which the property or assets of the Company are subject are
included as part of or specifically identified in the SEC Reports to the extent
required by the rules and regulations of the SEC as in effect at the time of
filing


 


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of such SEC Reports.  All such material agreements required to be
filed as exhibits to the SEC Reports are legal, valid and binding obligations
of the Company in accordance with their respective terms and, to the knowledge
of the Company, the other parties thereto, except in any case as may be limited
by bankruptcy, insolvency, reorganization or other laws affecting creditors’
rights generally and by general equitable principles.


 


3.9              Conformity
to Securities Act and Exchange Act; No Misstatement or Omission.  Each of the SEC Reports as of the date it was
filed with the SEC in the case of filings under the Exchange Act or declared
effective in the case of the Registration Statements, complied in all material
respects with the applicable requirements of the Securities Act or the Exchange
Act and the respective rules and regulations of the SEC thereunder and did not
contain an untrue statement of a material fact or omit to state a material fact
necessary in order to make the statements therein not misleading.


 


3.10            Financial
Statements; Indebtedness.


 


(a)           The
financial statements and supporting schedules included in the Company’s Annual
Report on Form 10-K for the year ended December 31, 2003, and in the Company’s
Quarterly Report on Form 10-Q for the quarter ended June 30, 2004 and in any
Registration Statements or other SEC Reports, in each case filed with the SEC,
are complete and correct in all material respects and present fairly the
consolidated financial position of the Company and its Subsidiaries as of the
dates specified and the consolidated results of their operations for the
periods specified, in each case, in conformity with generally accepted
accounting principles applied on a consistent basis during the periods
involved, except as indicated therein or in the notes thereto.


 


(b)           Except
for Indebtedness reflected in the financial statements  and except as set forth in Schedule 3.10(b) attached hereto, the
Company has no Indebtedness outstanding at the date hereof.  The Company is not in default with respect to
any outstanding Indebtedness or any instrument relating thereto.


 


3.11            Margin
Regulations.  Neither the sale of the Shares, nor the use of the
proceeds thereof, will violate Regulation T, U or X of the Board of Governors
of the Federal Reserve System.


 


3.12            Investment
Company Act.  The Company is not an
“investment company” or a company “controlled” by an “investment company,”
within the meaning of the Investment Company Act of 1940.


 


3.13            Public
Utility Holding Company Act.  The
Company is not a “holding company,” or a “subsidiary company” of a “holding
company,” or an “affiliate” of a “holding company” or of a “subsidiary company”
of a “holding company,” within the meaning of the Public Utility Holding
Company Act of 1935.


 


3.14            No
Material Adverse Changes.  Since June
30, 2004, (a) there has been no event which has had a Material Adverse Effect;
(b) except as contemplated by this Agreement or described in the SEC Reports,
there has been no transaction entered into by the Company or any of its
Subsidiaries other than transactions in the ordinary course of business or
transactions which would not, individually or in the aggregate, be material to
the Company; (c) except as set forth on Schedule 3.14
attached hereto, there have not been any changes in the Company’s
authorized capital or, other than the borrowings made by the Company under the
Senior Loan Agreement described on Schedule 3.14,
any material increases in the Indebtedness of the Company and its Subsidiaries
taken as a whole; and (d) there has been no actual or, to the knowledge of the
Company, threatened revocation of, or default under, any contract to which the
Company or any of its Subsidiaries is a party, except as would not have a
Material Adverse Effect.


 


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3.15            Tax
Returns and Payments.  Each of the
Company and each of its Subsidiaries has filed all federal income tax returns
and all other material domestic and foreign tax returns required to be filed by
it and has paid all material taxes and assessments payable by it which have
become due, except for those contested in good faith and adequately reserved
against (in the good faith determination of the Company), all of which, to the
extent outstanding on the Closing Date, have been disclosed by the Company in
the SEC Reports.  Each of the Company and
each of its Subsidiaries has paid, or has provided adequate reserves (in the
good faith judgment of the Company) for the payment of, all material federal,
state and foreign taxes that are not yet due and payable for all fiscal years,
including the current fiscal year, to date. 
No action, suit, proceeding, investigation, audit or claim is now
pending or, to the knowledge of the Company or its Subsidiaries, threatened by
any authority regarding any taxes relating to the Company or any of its
Subsidiaries which is reasonably likely to have a Material Adverse Effect.  As of the Closing Date, neither the Company
nor any of its Subsidiaries has entered into an agreement or waiver or been
requested to enter into an agreement or waiver extending any statute of
limitations relating to the payment or collection of taxes of the Company or
any of its Subsidiaries.  No tax return
of the Company or any of its Subsidiaries is or has been the subject of an
audit or examination by any taxing authority, other than any such audit or
examination which has been completed or closed. 
Each of the Company and its Subsidiaries has withheld from each payment
made to any of its past or present employees, officers and directors, and any
other person, the amount of all material taxes and other deductions required to
be withheld therefrom and paid the same to the proper taxing authority within
the time required by law.


 


3.16            Subsidiaries.  As of the Closing Date, the Company has no
directly held Subsidiary other than iBasis Global, Inc., iBasis Securities
Corporation, Inc. and iBasis Speech Solutions, Inc., and such Subsidiaries have
no Subsidiaries other than those listed on Schedule
3.16 attached hereto.  Each of the
Company and the Subsidiaries has good and marketable title to all of the shares
it purports to own of the stock of each Subsidiary, free and clear in each case
of any Lien.  All such shares have been
duly issued and are fully paid and nonassessable.  As of the Closing Date, the Company is not party
to any joint venture or similar arrangement.


 


3.17            Properties.  The Company and each of its Subsidiaries have
good and valid title to all material properties owned by them, including all
such properties reflected in their balance sheets included in the Company’s
Quarterly Report on Form 10-Q for the quarter ended June 30, 2004, free and
clear of all Liens, other than as referred to in such balance sheet or in the
notes thereto.


 


3.18            Labor
Relations.  The Company and its
Subsidiaries are not engaged in any unfair labor practice that is reasonably
likely to have a Material Adverse Effect. 
No unfair labor practice complaint is pending against the Company or any
of its Subsidiaries or, to the best of its knowledge, threatened against it or
any of its Subsidiaries, before the National Labor Relations Board or similar
foreign labor relations authority, and no grievance or arbitration proceeding
arising out of or under any collective bargaining agreement is so pending
against the Company or any of its Subsidiaries, or, to the best of its
knowledge, threatened against it or any of its Subsidiaries.  No strike, labor dispute, slowdown or
stoppage is pending against the Company or any of its Subsidiaries or, to the
best of its knowledge, threatened against the Company or any of it
Subsidiaries.  To the knowledge of the
Company, no union representation question exists with respect to the employees
of the Company or any of its Subsidiaries and no union organizing activities
are taking place.


 


3.19            Regulatory
Matters.


 


(a)           Authorizations.  The Company holds all Federal Communications
Commission (“FCC”), state public utility commission (“PUC”) and
foreign regulatory authority permits, licenses, certificates, registrations and
other similar authorizations necessary or appropriate for the conduct of its


 


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business (collectively, the “Authorizations”),
the lack of which would, individually or in the aggregate, have a Material
Adverse Effect.  The Company is in
compliance with all such Authorizations and any material terms and conditions
thereto except such non-compliance as would not, individually or in the
aggregate, have a Material Adverse Effect. 
Each Authorization which is material to the business of the Company is
valid and in full force and effect, and the Company has not received notice
from the FCC, any PUC, or any foreign regulatory authority of its intention to
revoke, condition or fail to renew any such Authorization, which would,
individually or in the aggregate, have a Material Adverse Effect.  To the knowledge of the Company, no event has
occurred which allows, or after notice or lapse of time would allow, revocation
or termination or result in any other material impairment of the Company’s
rights under any of its Authorizations to the extent that such revocation,
termination or impairment would have a Material Adverse Effect.


 


(b)           Compliance
with Law.  The conduct of the
Company’s business complies in all material respects with all applicable U.S.,
state and foreign laws (including, without limitation, the Communications Act
of 1934, as amended, and the Communications Assistance for Law Enforcement
Act), ordinances, rules, regulations, and orders (including, without
limitation, those issued by the FCC, any PUC or any foreign regulatory
authority), except where the failure to so comply would not have a Material
Adverse Effect.


 


(c)           Litigation.  There is no outstanding adverse judgment,
injunction, decree or order that has been issued by the FCC, any PUC or any
foreign regulatory authority against the Company which would, individually or
in the aggregate, have a Material Adverse Effect.  To the knowledge of the Company, there is no
action, investigation or proceeding pending or threatened, by the FCC, any PUC
or any foreign regulatory authority, against the Company or against any
officer, director, employee or agent of the Company in any court or before any
U.S., state or foreign governmental agency (including, without limitation, the
FCC, any PUC or any foreign regulatory authority), which would, individually or
in the aggregate, have a Material Adverse Effect, and, to the knowledge of the
Company, no claim has been made that the Company currently violates any
foreign, federal, state or local law, ordinance, rule or regulation to the
extent such claim would have a Material Adverse Effect.


 


(d)           Approvals.  The execution, performance and delivery of
this Agreement and the Transaction Documents, compliance by the Company with
all the provisions thereof and the consummation by the Company of the
transactions contemplated thereby will not (a) require any consent, approval,
exemption, or authorization from, notice to, or filing with the FCC, any PUC or
any foreign governmental authority, except as would not have a Material Adverse
Effect, (b) violate or conflict with the Communications Act of 1934, as
amended, or the rules or regulations of the FCC, any PUC or any foreign
regulatory authority, except as would not have a Material Adverse Effect, or
(c) cause any cancellation, termination, revocation, forfeiture or material
impairment of any of the Authorizations, except as would not have a Material
Adverse Effect.


 


3.20            Permits.


 


(a)           The
Company and its Subsidiaries have all franchises, permits, licenses and any
similar authority (the “Permits”) necessary for the conduct of their
business as now being conducted by them, the lack of which could, individually
or in the aggregate, reasonably be expected to have a Material Adverse
Effect.  As of the date hereof, no
suspension or cancellation of any of the Permits is pending or, to the
knowledge of the Company, threatened which could, individually or in the
aggregate, reasonably be expected to have a Material Adverse Effect.


 


3.21            ERISA.  Neither the Company, any Subsidiary of the
Company nor any ERISA Affiliate maintains or contributes to any Plan other than
those listed on Schedule 3.21 attached
hereto.


 


9
















 


(a)           Compliance
with ERISA.  The Company and each
ERISA Affiliate is in compliance with ERISA, except for such failures to comply
that, in the aggregate for all such failures, would not reasonably be expected
to have a Material Adverse Effect and no contributions required to be made by
the Company or any ERISA Affiliate to any pension plan are overdue.


 


(b)           PBGC.
No liability to the PBGC has been or is expected to be incurred by the Company
or any ERISA Affiliate with respect to any pension plan that, individually or
in the aggregate, would reasonably be expected to have a Material Adverse
Effect.  No circumstance exists that
constitutes grounds under section 4042 of ERISA entitling the PBGC to institute
proceedings to terminate, or appoint a trustee to administer, any pension plan
or trust created thereunder, nor has the PBGC instituted any such proceeding.


 


(c)           Multiemployer Plans.  Neither the Company nor any ERISA Affiliate
has incurred or presently expects to incur any withdrawal liability under Title
IV of ERISA with respect to any multiemployer plan except for such withdrawal
liability that, in the aggregate of all such liabilities, would not reasonably be
expected to have a Material Adverse Effect. 
There have been no “reportable events” (as such term is defined in
section 4043 of ERISA) with respect to any multiemployer plan that could result
in the termination of such multiemployer plan and give rise to a liability of
the Company or any ERISA Affiliate in respect thereof except for such
“reportable events” that, in the aggregate for all such “reportable events,”
would not reasonably be expected to have a Material Adverse Effect.


 


3.22            No Undisclosed Liabilities.  Except as disclosed, reflected or reserved
against in the financial statements and supporting schedules included in the
Company’s Annual Report on Form 10-K for the year ended December 31, 2003, and in the Company’s Quarterly Report on Form 10-Q for
the quarter ended June 30, 2004 and in any Registration Statements or other SEC Reports, there are no
liabilities of the Company or any Subsidiary, other than liabilities incurred
in the ordinary course of business consistent with past practice since June 30,
2004 or which in the aggregate would not reasonably be expected to result in a
Material Adverse Effect.


 


3.23            Insurance.  The Company maintains insurance
of the types and in the amounts that the Company reasonably believes is prudent
and adequate for its business as currently conducted, all of which insurance is
in full force and effect.


 


3.24            Accounts Receivable.  Except as disclosed on Schedule 3.24 attached hereto, the accounts and notes
receivable of the Company and its Subsidiaries reflected on the balance sheet
included in the Company’s Annual Report on Form 10-K for the year ended
December 31, 2003, and all accounts and notes receivable arising subsequent to
December 31, 2003, (i) arose from bona fide sales transactions in the ordinary
course of business consistent with past practice and are payable on ordinary
trade terms, (ii) to the knowledge of the Company and each Subsidiary, are
legal, valid and binding obligations of the respective debtors enforceable in
accordance with their respective terms, (iii) to the knowledge of the Company
and each Subsidiary, are not subject to any valid set-off or counterclaim, and
(iv) are not the subject of any actions or proceedings brought by or on behalf
of the Company or any Subsidiary, other than bankruptcy proceedings.


 


3.25            Brokers.  Except as disclosed in Schedule 3.25 attached hereto, neither the Company nor any
Subsidiary has any liability to pay any fees, commissions or other similar
compensation to any broker, finder, investment banker, financial advisor or
other similar Person in connection with the transactions contemplated by this
Agreement.


 


3.26            Leases.  Each of the Company and the Subsidiaries has
complied with all material obligations under all leases to which it is a party
as a lessee.  All leases relating to the
leasehold estates of


 


10
















 


each of the Company and the
Subsidiaries necessary in any material respect for the conduct of the business
of such Person are, with respect to the Company, valid and enforceable, and, to
the knowledge of the Company, are, valid and enforceable with respect to the
lessor, and each of the Company and the Subsidiaries that is the lessee in
respect thereof currently enjoys peaceful and undisturbed possession of the premises
subject thereto.


 


3.27            Intellectual
Property.  Each of the Company and
the Subsidiaries owns, possesses or has the right to use all of the patents,
trademarks, service marks, trade names, copyrights, franchises and licenses,
and rights with respect thereto, necessary for the present and currently
planned future conduct of its business, without any known conflict with the
rights of others, except for such failures to own, possess, or have the right
to use, that, in the aggregate for all such failures, could not reasonably be
expected to have a Material Adverse Effect.


 


3.28            Environmental
Compliance.


 


(a)           Compliance.  Each of the Company and the Subsidiaries is
in compliance with all Environmental Protection Laws in effect in each
jurisdiction where it is currently doing business, except where the failure to
so comply, in the aggregate for all such failures, would not reasonably be
expected to have a Material Adverse Effect.


 


(b)           Liability.  Neither the Company nor any Subsidiary is
subject to any liability under any Environmental Protection Law that, in the
aggregate for all such liabilities, would reasonably be expected to have a
Material Adverse Effect.


 


(c)           Notices.  Neither the Company nor any Subsidiary has
received any


 


(i)  notice from
any Governmental Authority by which any of its currently or previously owned or
leased properties has been identified in any manner by any Governmental
Authority as a hazardous substance disposal or removal site, “Super Fund”
clean-up site, or candidate for removal or closure pursuant to any
Environmental Protection Law,


 


(ii)  notice of
any Lien arising under or in connection with any Environmental Protection Law
that has attached to any revenues of, or to, any of its currently or previously
owned or leased properties, or


 


(iii) communication, written or oral, from any
Governmental Authority concerning any action or omission in connection with its
currently or previously owned or leased properties resulting in the release of
any hazardous substance resulting in any violation of any Environmental
Protection Law,


 


in each case
where the effect of which, in the aggregate for all such notices and
communications, would reasonably be expected to have a Material Adverse Effect.


 


3.29            Registration
Rights.  Except as set forth on Schedule 3.29 attached hereto, the
Company is not currently subject to any agreement providing any person or
entity any rights (including piggyback registration rights) to have any
securities of the Company registered with the SEC or registered or qualified
with any other governmental authority.


 


3.30            Transactions
with Affiliates and Employees. Except as set forth in the SEC Reports or on
Schedule 3.30 attached hereto, none of
the officers or directors of the Company and, to the knowledge of the Company,
none of the employees of the Company, is presently a party to any


 


11
















 


transaction or agreement with
the Company (other than for services as employees, officers and directors)
exceeding $60,000 in value, including any contract, agreement or other
arrangement providing for the furnishing of services to or by, providing for
rental of real or personal property to or from, or otherwise requiring payments
to or from any officer, director or such employee or, to the knowledge of the
Company, any entity in which any officer, director, or any such employee has a
substantial interest or is an officer, director, trustee or partner.


 


3.31            Internal
Accounting Controls. Except as disclosed in the SEC Reports and as would
not otherwise be reasonably expected to have a Material Adverse Effect, 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 United States generally accepted accounting principles and to
maintain asset accountability, (iii) access to assets is permitted only in
accordance with management’s general or specific authorizations, 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.


 


3.32            Securities
Laws. Subject to the accuracy of the Purchasers’ representations and
warranties set forth in Section 4 below and an Investor Questionnaire
executed and delivered by each Purchaser to the Company, such Investor
Questionnaire in the form attached hereto as Exhibit  B, the
offer, sale and issuance of the Shares, as provided in this Agreement, is and
is intended to be (a) exempt from the registration requirements of the
Securities Act pursuant to one or more of Sections 3(b) and 4(2) hereof and Regulation
D promulgated thereunder, and (b) exempt from registration or qualification
requirements of applicable state securities laws. Neither the Company nor
anyone acting on its behalf has taken or hereafter will take any action that
would cause the loss of such exemptions.


 


3.33            No
Integrated Offering.  Neither the
Company, nor any Affiliate of the Company, nor any person acting on its or
their behalf has, directly or indirectly, made any offers or sales of any
security or solicited any offers to buy any security, under circumstances that
would cause the offering or issuance of the Shares, the Warrants or any Warrant
Shares pursuant to this Agreement to be integrated with prior offerings by the
Company for purposes of the Securities Act which would cause the exemptions
from SEC registration upon which the Company is relying for the offering or
issuance of the Shares, the Warrants or any Warrant Shares pursuant to this
Agreement to be unavailable, any applicable state securities laws or any
applicable stockholder approval provisions, including, without limitation,
under the rules and regulations of any national securities exchange or
automated quotation system on which any of the securities of the Company are
listed or designated, nor will the Company take any action or steps that would
cause the offering or issuance of the Shares, the Warrants or any Warrant
Shares pursuant to this Agreement to be integrated with other offerings.


 


4              Representations
and Warranties of the Purchasers. Each Purchaser represents and warrants,
severally (as to such Purchaser only) and not jointly, to the Company as
follows:


 


4.1              Authorization. All action on the part of such
Purchaser and, if applicable, its officers, directors, managers, members,
shareholders and/or partners necessary for the authorization, execution,
delivery and performance of this Agreement and the Registration Rights
Agreement, and the consummation of the transactions contemplated herein and
therein, has been taken. When executed and delivered, each of this Agreement
and the Registration Rights Agreement will constitute the legal, valid and
binding obligation of such Purchaser, enforceable against such Purchaser in
accordance with its terms, except as such may be limited by bankruptcy,
insolvency, reorganization or other laws affecting creditors’ rights generally
and by general equitable principles. Such Purchaser has all requisite power and


 


12
















 


authority to enter into each of
this Agreement and the Registration Rights Agreement, and to carry out and
perform its obligations under the terms of hereof and thereof.


 


4.2              Purchase
Entirely for Own Account. Such Purchaser is acquiring the Shares and the
Warrants for its own account for investment and not for resale or with a view
to distribution thereof in violation of the Securities Act.


 


4.3              Investor
Status; Etc. Such Purchaser certifies and represents to the Company that it
is an “accredited investor” as defined in Rule 501 of Regulation D promulgated
under the Securities Act and was not organized for the purpose of acquiring any
of the Shares or the Warrants. Such Purchaser’s financial condition is such
that it is able to bear the risk of holding the Shares for an indefinite period
of time and the risk of loss of its entire investment. Such Purchaser has
sufficient knowledge and experience in investing in companies similar to the
Company so as to be able to evaluate the risks and merits of its investment in
the Company.


 


4.4              Securities
Not Registered. Such Purchaser understands that the Shares, the Warrant and
any Warrant Shares issued thereunder have not been registered under the
Securities Act, by reason of their issuance by the Company in a transaction
exempt from the registration requirements of the Securities Act, and that the
Shares, the Warrants and any Warrant Shares issued thereunder must continue to
be held by such Purchaser unless a subsequent disposition thereof is registered
under the Securities Act or is exempt from such registration. Such Purchaser
understands that the exemptions from registration afforded by Rule 144 (the
provisions of which are known to it) promulgated under the Securities Act
depend on the satisfaction of various conditions, and that, if applicable, Rule
144 may afford the basis for sales only in limited amounts.


 


4.5              No
Violation. Neither the execution, delivery and performance by such
Purchaser of this Agreement and the Registration Rights Agreement nor
compliance with the terms and provisions hereof by such purchaser (a) will
contravene any applicable provision of any law, statute, rule, regulation,
order, writ, injunction or decree of any court or governmental instrumentality,
except as would not have a material effect on such Purchaser; or (b) will
violate any provision of the organizational documents of such Purchaser.


 


4.6              Brokers. Such Purchaser has not retained,
utilized or been represented by any broker or finder in connection with the
transactions contemplated by this Agreement.


 


4.7              Consents. All consents, approvals, orders and
authorizations required on the part of such Purchaser in connection with the
execution, delivery or performance of this Agreement and the consummation of
the transactions contemplated herein have been obtained and are effective as of
the date hereof.


 


4.8              Disclosure
of Information. Such Purchaser believes it has received all the information
it considers necessary or appropriate for deciding whether to purchase the
Shares and the Warrants. Such Purchaser further represents that it has had an
opportunity to ask questions and receive answers from the Company regarding the
terms and conditions of the offering of the Shares and the Warrants and the
business, properties, prospects and financial condition of the Company.


 


5              Conditions
Precedent. 


 


5.1              Conditions
to the Obligation of the Purchasers to Consummate the Closing. The
obligation of each Purchaser to consummate the Closing and to purchase and pay
for the Shares is subject to the satisfaction of the following conditions
precedent:


 


13
















 


(a)           The
representations and warranties of the Company contained herein shall be true
and correct in all material respects on and as of the Closing Date. The Company
shall have performed all obligations and conditions herein required to be
performed or complied with by the Company on or prior to the Closing Date.


 


(b)           There
shall have been no event or events which has occurred since the date hereof and
taken individually or in the aggregate is reasonably likely to have a Material
Adverse Effect.


 


(c)           No
proceeding challenging this Agreement or the Transaction Documents, or the
transactions contemplated hereby or thereby, or seeking to prohibit, alter,
prevent or materially delay the Closing, shall have been instituted before any
court, arbitrator or governmental body, agency or official or shall be pending
against or involving the Company.


 


(d)           The
sale of the Shares and the issuance of the Warrants to the Purchasers shall not
be prohibited by any law, rule, governmental order or regulation. All necessary
consents, approvals, licenses, permits, orders and authorizations of, or
registrations, declarations and filings with, any governmental or
administrative agency or of or with any other Person with respect to any of the
transactions contemplated hereby shall have been duly obtained or made and
shall be in full force and effect.


 


(e)           The Purchasers shall have received
from Bingham McCutchen LLP, outside counsel to the Company, an opinion
addressed to such Purchaser, dated the Closing Date and substantially in the
form of Exhibit  C hereto.


 


(f)            The
Registration Rights Agreement shall have been executed and delivered to the
Purchasers by the Company.


 


(g)           The
Company shall have delivered to the Purchasers a certificate substantially in
the form of Exhibit D hereto dated
the Closing Date and signed by the secretary or another officer of the Company,
certifying (i) that the copies of the Certificate of Incorporation, the By-Laws
and resolutions of the Board approving this Agreement, the Transaction
Documents and the transactions contemplated hereby and thereby attached
thereto, are all true, complete and correct and remain in full force and effect
as of such date, and (ii) as to the incumbency and specimen signature of each
officer of the Company executing this Agreement, the Transaction Documents and
any other document delivered in connection herewith on behalf of the Company.


 


(h)           The
Company shall have delivered to the Purchasers a certificate substantially in
the form of Exhibit E hereto dated
the Closing Date and signed by the Company’s chief financial officer,
certifying that (i) the representations and warranties of the Company contained
in Section 3 hereof are true and correct in all material respects on the
Closing Date and (ii) the Company has performed and complied with all of the
agreements and conditions set forth or contemplated herein that are required to
be performed or complied with by the Company on or before the Closing Date.


 


(i)            Such
Purchaser shall have received from the Company an original stock certificate
evidencing the purchase of the Shares and an original Warrant, in each case for
the number of shares of Common Stock and the number of Warrant Shares,
respectively, set forth opposite such Purchaser’s name on Schedule I hereto, and bearing the legends required to be imprinted
thereon pursuant to Section 6.2 hereof.


 


14
















 


(j)            The
Company shall have delivered to the Purchasers a certificate of good standing
issued by the Secretary of State of the State of Delaware, and a certificate of
qualification to do business by the Secretary of the Commonwealth of the
Commonwealth of Massachusetts.


 


(k)           The
Purchasers shall have received a copy of the duly executed Transfer Agent
Instruction Letter in the form of Exhibit  F hereto.


 


5.2              Conditions
to the Obligation of the Company to Consummate the Closing. The obligation
of the Company to consummate the Closing and to issue and sell the Shares to
each Purchaser at the Closing is subject to the satisfaction of the following
conditions precedent:


 


(a)           The
representations and warranties of such Purchaser contained herein shall be true
and correct in all respects on and as of the Closing Date with the same force
and effect as though made on and as of the Closing Date.


 


(b)           The
Registration Rights Agreement shall have been executed and delivered by such
Purchaser.


 


(c)           Such
Purchaser shall have performed all obligations and conditions herein required
to be performed or complied with by such Purchaser on or prior to the Closing
Date, including but not limited to tendering its entire portion of the
Aggregate Purchase Price.


 


(d)           No
proceeding challenging this Agreement or the Transaction Documents, or the
transactions contemplated hereby or thereby, or seeking to prohibit, alter,
prevent or materially delay the Closing, shall have been instituted before any
court, arbitrator or governmental body, agency or official or shall be pending
against or involving such Purchaser.


 


(e)           The
sale of the Shares and the issuance of the Warrants by the Company shall not be
prohibited by any law, rule, governmental order or regulation. All necessary
consents, approvals, licenses, permits, orders and authorizations of, or
registrations, declarations and filings with, any governmental or
administrative agency or of any other Person with respect to any of the
transactions contemplated hereby shall have been duly obtained or made and
shall be in full force and effect.


 


(f)            Such
Purchaser shall have delivered to the Company each of a Form W-9 or Form W-8,
as applicable, and a completed Investor Questionnaire in the form of Exhibit
B hereto.


 


(g)           The
Aggregate Purchase Price shall have been tendered to the Company in payment for
the Shares hereunder.


 


6              Certain
Covenants and Agreements.


 


6.1              Transfer
of Securities. Each Purchaser agrees severally (as to itself only) and not
jointly that it shall not sell, assign, pledge, transfer or otherwise dispose
of or encumber any of the Shares, the Warrants or any Warrant Shares, except: (i)
pursuant to an effective registration statement under the Securities Act; (ii)
to an Affiliate (so long as such Affiliate agrees to be bound by the terms and
provisions of this Agreement as if, and to the fullest extent as, such
Purchaser); or (iii) pursuant to an available exemption from registration under
the Securities Act (including sales permitted pursuant to Rule 144) and
applicable state securities laws. Any transfer or purported transfer of the
Shares in violation of this Section 6.1 shall be void. The Company shall not
register any transfer of the Shares in violation of this Section 6.1. The
Company may, and may instruct any transfer agent for the Company, to place such


 


15
















 


stop transfer orders as may be
required on the transfer books of the Company in order to ensure compliance
with the provisions of this Section 6.1.


 


6.2              Legends.


 


(a)           To
the extent applicable, each certificate or other document evidencing the
Shares, the Warrants and any Warrant Shares shall be endorsed with the legend
set forth below, and each Purchaser covenants that, except to the extent such
restrictions are waived by the Company, it shall not transfer the shares
represented by any such certificate without complying with the restrictions on
transfer described in this Agreement and the legends endorsed on such
certificate:


 


“THE SHARES REPRESENTED BY
THIS CERTIFICATE HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS
AMENDED, AND MAY NOT BE OFFERED OR SOLD IN THE ABSENCE OF AN EFFECTIVE
REGISTRATION STATEMENT UNDER SAID ACT OR PURSUANT TO AN AVAILABLE EXEMPTION
FROM, OR IN A TRANSACTION NOT SUBJECT TO, REGISTRATION UNDER SAID ACT.”


 


(b)           The
legend set forth in Section 6.2(a) shall be removed from the certificates evidencing
the Shares, Warrants and any Warrant Shares, (i) following any sale of such
Shares, Warrants or Warrant Shares pursuant to Rule 144 or any effective
registration statement, or (ii) if such Shares, Warrants or Warrant Shares are
eligible for sale under Rule 144(k) (and the holder of such Shares, Warrants or
Warrant Shares has submitted a written request for removal of the legend
indicating that the holder has complied with the applicable provisions of Rule
144), or (iii) if such legend is not required under applicable requirements of
the Securities Act (including judicial interpretations and pronouncements
issued by the Staff of the Commission) (and the holder of such Shares, Warrants
or Warrant Shares has submitted a written request for removal of the legend
indicating that the holder has complied with such judicial interpretation or
pronouncement). Subject to receipt of appropriate certifications, the Company
shall cause its counsel to issue a legal opinion to the Company’s transfer
agent promptly upon the occurrence of any of the events in clauses (i), (ii) or
(iii) above to effect the removal of the legend on certificates evidencing the
Shares or any Warrant Shares and shall also cause its counsel to issue a
“blanket” legal opinion to the Company’s transfer agent promptly after the
effective date of any registration statement covering the resale of the Shares
or any Warrant Shares (provided that there is an effective registration
statement covering the resale of the Shares or any Warrant Shares, as the case
may be), if required by the Company’s transfer agent, to allow sales without
restriction pursuant to an effective registration statement. The Company agrees
that at such time as such legend is no longer required under this Section
6.2(b), it will, no later than three (3) business days following the delivery
by a Purchaser to the Company or the Company’s transfer agent of a certificate
representing the Shares or any Warrant Shares issued with a restrictive legend,
deliver or cause to be delivered to such Purchaser a certificate representing
such Shares or Warrant Shares that is free from all restrictive and other
legends; provided that in the case of removal of the legend for reasons
set forth in clause (ii) above, the holder of such Shares or Warrant Shares has
submitted a written request for removal of the legend indicating that the
holder has complied with the applicable provisions of Rule 144. The Company may
not make any notation on its records or give instructions to any transfer agent
of the Company that enlarge the restrictions on transfer set forth in this
Section 6.


 


6.3              Publicity. Except to the extent required by
applicable laws, rules, regulations or stock exchange requirements, the
Company, the Subsidiaries and their Affiliates shall not, without the written
consent of the Majority Purchasers, make any public announcement or issue any
press release with respect to the transactions contemplated by this
Agreement.  Except to the extent required
by applicable laws, rules, regulations or stock exchange requirements, the
Purchasers and their Affiliates shall not, without the written consent of the
Company make any public announcement or issue any press


 


16
















 


release with respect to the
transactions contemplated by this Agreement. 
In no event will either (i) the Company, the Subsidiaries or any of
their Affiliates or (ii) any Purchaser or any of its Affiliates make any public
announcement or issue any press release with respect to the transactions contemplated
by this Agreement without consulting with the Company, on the one hand, and the
Majority Purchasers, on the other hand, to the extent feasible, as to the
content of such public announcement or press release.  Notwithstanding the foregoing, the parties
agree that the Company shall issue a press release in the form of Exhibit
G hereto promptly following the Closing.


 


6.4              Use
of Proceeds. The Company covenants and agrees that the proceeds from the
sale of the Shares shall be used by the Company for repayment or prepayment of
indebtedness of the Company, working capital and general corporate purposes or
any other purpose approved by the Board, including, without limitation, growth
initiatives, capital expenditures and potential acquisitions.  The Company covenants and agrees that no part
of the proceeds from the sale of the Shares will be used to purchase or carry
any Margin Stock or to extend credit for the purpose of purchasing or carrying
any Margin Stock.  The Company further
covenants and agrees that it will not use the proceeds from the sale of the
Shares in such as manner as to subject the Company to regulation as an
“investment company” under the Investment Company Act of 1940, as amended.


 


6.5              Integration.
The Company shall not sell, offer for sale or solicit offers to buy or
otherwise negotiate in respect of any security (as defined in Section 2 of the
Securities Act) that would be integrated with the offer or sale of the Shares
in a manner that would require the registration under the Securities Act of the
sale of the Shares or the issuance of the Warrants or any Warrant Shares to the
Purchasers.


 


6.6              Reservation
of Common Stock for Issuance; Listing of Shares.  The Company agrees to reserve from its duly
authorized capital stock the total number of shares of Common Stock issuable
upon execution of this Agreement and upon the exercise in full of the
Warrants.  The Company agrees that at any
time, if and when its shares of Common Stock are listed on NASDAQ or any other
securities exchange, that it will use reasonable efforts to promptly list and
qualify the Shares and any Warrant Shares for trading on NASDAQ or such other
securities exchange.


 


6.7              Restrictions
on Certain Stock Issuances or Registrations.  The Company agrees that if a Demand Request (as
defined in the Registration Rights Agreement) is delivered on or prior to the
thirty (30) day anniversary of the date hereof, the Company shall not (i) issue
any shares of Common Stock that could be eligible for sale without restriction
under the Securities Act prior to the effectiveness of the Demand Registration
Statement (as defined in the Registration Rights Agreement),  or (ii) grant any
registration rights after the date hereof to any other Person that would
entitle such Person to have the sale of securities held by such Person
registered under the Securities Act by the Company under a registration
statement that is declared effective prior to the effectiveness of the Demand
Registration Statement, provided, that this Section 6.7 shall not be
deemed to restrict the ability of the Company to issue shares of Common Stock
upon the exercise or conversion of any options, warrants, convertible debt
instruments or other contingent securities outstanding on the date hereof, or
the ability of the Company to perform its obligations under the Existing
Agreements (as defined in the Registration Rights Agreement).


 


7              Indemnification.


 


7.1              By
the Company. The Company agrees to indemnify, defend and hold harmless each
Purchaser and its Affiliates and their respective officers, directors, agents,
employees, subsidiaries, partners, members and controlling persons
(collectively, the “Purchaser Indemnitees”)
to the fullest extent permitted by law from and against any and all claims,
losses, liabilities, damages, deficiencies, judgments, assessments, fines,
settlements, costs or expenses (including interest, penalties and reasonable
fees,


 


17
















 


disbursements and other charges
of counsel) (collectively, “Losses”) based
upon, arising out of or otherwise in respect of any breach by the Company of
any representation, warranty, covenant or agreement of the Company contained in
this Agreement or in the Transaction Documents.


 


7.2              Limitations.


 


(a)           Time
for Claims. No Indemnifying Party will be liable for any Losses hereunder
arising out of a breach of representation or warranty unless a written claim
for indemnification is given by the Indemnified Party to the Indemnifying Party
on or prior to the third anniversary of the date on which a registration
statement covering the resale of the Shares initially became effective.


 


(b)           Maximum
Amount. Notwithstanding anything contained herein to the contrary, no
Indemnifying Party will be liable for any Losses to any Purchaser Indemnitee
hereunder in excess of the portion of the Aggregate Purchase Price actually
paid by the related Purchaser, provided, that the foregoing limitation
shall not apply in the case of Losses due to the bad faith, gross negligence or
willful misconduct of any Indemnifying Party.


 


7.3              Applicability.
Notwithstanding any term to the contrary in this Section 7, the indemnification
and contribution provisions of the Registration Rights Agreement shall govern
any claim made with respect to registration statements filed pursuant thereto
or sales made thereunder.


 


8              Miscellaneous
Provisions.


 


8.1              Rights
Cumulative. Each and all of the various rights, powers and remedies of the
parties shall be considered to be cumulative with and in addition to any other
rights, powers and remedies which such parties may have at law or in equity in
the event of the breach of any of the terms of this Agreement.  The exercise or partial exercise of any
right, power or remedy shall neither constitute the exclusive election thereof
nor the waiver of any other right, power or remedy available to such party.


 


8.2              Pronouns.
All pronouns or any variation thereof shall be deemed to refer to the
masculine, feminine or neuter, singular or plural, as the identity of the
person, persons, entity or entities may require.


 


8.3              Notices.


 


(a)           Any
notices, reports or other correspondence (hereinafter collectively referred to
as “correspondence”) required or permitted to be given hereunder shall be sent
by postage prepaid first class mail, overnight courier or telecopy, or
delivered by hand to the party to whom such correspondence is required or
permitted to be given hereunder. The date of giving any notice shall be the
date of its actual receipt.


 


	
  (b)

  	
   

  	
  All
  correspondence to the Company shall be addressed as follows:

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  iBasis, Inc.

  
	
   

  	
   

  	
  20 Second
  Avenue

  
	
   

  	
   

  	
  Burlington,
  MA  01803

  
	
   

  	
   

  	
  Attention:  Chief Financial Officer

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  with a copy
  to:

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Johan V.
  Brigham

  



 


18
















 


	
   

  	
   

  	
  Bingham
  McCutchen LLP

  
	
   

  	
   

  	
  150 Federal
  Street

  
	
   

  	
   

  	
  Boston, MA
  02110

  



 


(c)           All
correspondence to the Purchasers shall be addressed pursuant to the contact
information set forth on Schedule I
attached hereto.


 


(d)           Any
entity may change the address to which correspondence to it is to be addressed
by notification as provided for herein.


 


8.4              Captions.
The captions and paragraph headings of this Agreement are solely for the
convenience of reference and shall not affect its interpretation.


 


8.5              Severability.
Should any part or provision of this Agreement be held unenforceable or in
conflict with the applicable laws or regulations of any jurisdiction, the
invalid or unenforceable part or provisions shall be replaced with a provision
which accomplishes, to the extent possible, the original business purpose of
such part or provision in a valid and enforceable manner, and the remainder of
this Agreement shall remain binding upon the parties hereto.


 


8.6              Governing
Law. This Agreement shall be governed by and construed in accordance with
the internal and substantive laws of the State of New York without regard to
any conflicts of laws concepts which would apply the substantive law of some
other jurisdiction.


 


8.7              Waiver.
No waiver of any term, provision or condition of this Agreement, whether by
conduct or otherwise, in any one or more instances, shall be deemed to be, or
be construed as, a further or continuing waiver of any such term, provision or
condition or as a waiver of any other term, provision or condition of this
Agreement.


 


8.8              Assignment.
The rights and obligations of any party hereto shall inure to the benefit of
and shall be binding upon the authorized successors and permitted assigns of
such party. The Company may not assign this Agreement or any rights or
obligations hereunder without the prior written consent of each Purchaser. Each
Purchaser may assign or transfer any or all of its rights under this Agreement
to any Person provided that such assignee or transferee agrees in writing to be
bound, with respect to the transferred Shares and Warrant Shares, by the
provisions hereof that apply to such assigning or transferring Purchaser;
whereupon such assignee or transferee shall be deemed to be a “Purchaser” for
all purposes of this Agreement.


 


8.9              Survival. The respective representations and
warranties given by the parties hereto shall survive the Closing Date and the
consummation of the transactions contemplated herein for a period of time equal
to the time for which indemnification may be sought hereunder, without regard
to any investigation made by any party, provided that the
representations and warranties made under Section 3.5 shall survive
indefinitely. The respective covenants and agreements agreed to by a party
hereto shall survive the Closing Date and the consummation of the transactions
contemplated herein in accordance with their respective terms and conditions.


 


8.10            Entire
Agreement. This Agreement and the Transaction Documents constitute the
entire agreement between the parties hereto respecting the subject matter
hereof and supersedes all prior agreements, negotiations, understandings,
representations and statements respecting the subject matter hereof, whether
written or oral, including but not limited to the various Term Sheets dated
September [17], 2004 between the Company and the Purchasers.  The Company agrees that in the event it
enters into any agreement or understanding with any Purchaser pursuant to which
the Company grants such


 


19
















 


Purchaser any rights or other
terms relating to the purchase, holding or disposition of Shares, Warrant
Shares or Warrants that are more favorable than those set forth herein or in
the Transaction Documents, the Company shall also grant each other Purchaser
such more favorable rights or other terms.


 


8.11            Amendments.
Any amendment, supplement or modification of or to any provision of this
Agreement, any waiver of any provisions of this Agreement shall be effective
only if made or given in writing and signed by the Company and the Majority
Purchasers, provided, that any amendment, supplement, modification or
waiver that is materially and disproportionately adverse to any Purchaser(s),
when compared to all other Purchasers, shall require the consent of such
Purchaser(s).


 


8.12            No
Third Party Rights. This Agreement is intended solely for the benefit of
the parties hereto and is not intended to confer any benefits upon, or create
any rights in favor of, any Person (including, without limitation, any
stockholder or debt holder of the Company) other than the parties hereto, provided,
that (a) the Investors (as defined in the Registration Rights Agreement) and
the Holders (as defined in the Warrant) are entitled to all rights and benefits
as third party beneficiaries of Sections 6.6 and 6.7 of this Agreement and (b)
each of the Purchaser Indemnitees that are not Purchasers are entitled to all
rights and benefits as third party beneficiaries of Article 7 of this
Agreement.


 


8.13            Counterparts. This Agreement may be executed
in any number of counterparts, each of which shall be deemed an original, but
all of which together shall constitute one and the same document. The parties
hereto confirm that any facsimile copy of another party’s executed counterpart
of this Agreement (or its signature page thereof) will be deemed to be an executed
original thereof.


 


[Signature
pages follow.]


 


20
















 


Each
of the parties hereto has cause a counterpart of this Agreement to be duly
executed and delivered as of the date first written above.


 


THE COMPANY:


 


 


	
   

  	
  iBASIS, INC.

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Ofer Gneezy

  	
   

  
	
   

  	
  Name:

  	
  Ofer Gneezy

  
	
   

  	
  Title:

  	
  President and Chief Executive Officer

  
					



 
















 


THE PURCHASERS:


 


 


	
   

  	
  THE IBS TURNAROUND FUND, L.P.

  
	
   

  	
   

  
	
   

  	
  By its General Partner, IBS Capital Corp.

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ David Taft

  	
   

  
	
   

  	
  Title: President, IBS Capital Corp

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  THE IBS OPPORTUNITY FUND, LTD.

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ David Taft

  	
   

  
	
   

  	
  Title: Manager

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  YORK INVESTMENT LIMITED

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Adam J. Semler

  	
   

  
	
   

  	
  Title: Chief Financial Officer of its Investment Manager

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  YORK CREDIT OPPORTUNITIES FUND, L.P.

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Adam J. Semler

  	
   

  
	
   

  	
  Title: Chief Financial Officer of its General Partner

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  YORK CAPITAL MANAGEMENT, L.P.

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Adam J. Semler

  	
   

  
	
   

  	
  Title: Chief Financial Officer of its General Partner

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  ELEVEN RINGS OPPORTUNITY FUND, LP

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Lindsay Leet

  	
   

  
	
   

  	
  Title: Managing Member

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  NEW GENERATION LIMITED PARTNERSHIP

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ George Putnamm III

  	
   

  
	
   

  	
  Title:

  	
  President of its General Partner

  
					



 
















 


	
   

  	
  NEW GENERATION TURNAROUND FUND

  (BERMUDA) LTD.

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ George Putnamm III

  	
   

  
	
   

  	
  Title:

  	
  President of its General Partner

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  PHOENIX PARTNERS, L.P.

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Joann McNiff

  	
   

  
	
   

  	
  Title:

  	
  Authorized Agent

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  PHOENIX PARTNERS II, L.P.

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Joann McNiff

  	
   

  
	
   

  	
  Title:

  	
  Authorized Agent

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  PHAETON INTERNATIONAL (BVI) LTD

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Joann McNiff

  	
   

  
	
   

  	
  Title:

  	
  Authorized Agent

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  John C. Waterfall

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Joann McNiff

  	
   

  
	
   

  	
  Title:

  	
  Attorney-in-Fact for John C. Waterfall

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  CROSSLINK CROSSOVER FUND IV, LP

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Michael J. Stark

  	
   

  
	
   

  	
  Title:

  	
  Managing Member

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  DELTA GROWTH, L.P.

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Michael J. Stark

  	
   

  
	
   

  	
  Title:

  	
  Managing Member

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  OFFSHORE CROSSLINK CROSSOVER FUND III

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Michael J. Stark

  	
   

  
	
   

  	
  Title:

  	
  Managing Member

  
					



 
















 


	
   

  	
  /s/ George W. Haywood

  	
   

  
	
   

  	
  George W. Haywood

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  LOEB PARTNERS CORPORATION

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Robert Grubin

  	
   

  
	
   

  	
  Title:

  	
  Vice President

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  MILLER FAMILY PARTNERSHIP I

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Lloyd Miller

  	
   

  
	
   

  	
  Title:

  	
  Investment Advisor

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  MILLENNIUM PARTNERS L.P.

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Terry Feeney

  	
   

  
	
   

  	
  Title:

  	
  Vice Chairman and Chief Operating Officer

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  GREYWOLF
  CAPITAL OVERSEAS FUND

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ William
  Troy

  	
   

  
	
   

  	
  Title:

  	
  Chief
  Operating Officer

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  GREYWOLF
  CAPITAL PARTNERS II LP

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ William
  Troy

  	
   

  
	
   

  	
  Title:

  	
  Chief
  Operating Officer

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  LC
  CAPITAL MASTER FUND, LTD.

  
	
   

  	
   

  
	
   

  	
  By its Investment Advisor, Lampe, Conway & Co.
  LLC

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Steven G. Lampe

  	
   

  
	
   

  	
  Title:

  	
  Managing Member

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  SINGER
  CHILDREN’S MANAGEMENT TRUST

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Gary
  Singer

  	
   

  
	
   

  	
  Title:

  	
  Investment
  Advisor

  
	
   

  	
   

  
					



 
















 


Schedule I to Securities Purchase Agreement


 


 


	
  Purchasers

  	
   

  	
  Shares

  Purchased

  	
   

  	
  Warrant Shares

  Purchased

  	
   

  	
  25% of Warrant

  Shares

  Purchased

  	
   

  
	
  The IBS
  Turnaround Fund, L.P.

  2 International Place, 24th Floor

  Boston, Massachusetts  02110

  EIN: 93-1146657

  	
   

  	
  1,120,000

  	
   

  	
  168,000

  	
   

  	
  42,000

  	
   

  
	
  The IBS
  Opportunity Fund, Ltd.

  Ellen Skelton Building, Fisher’s

  Estate

  Road Town, Tortola, British Virgin

  Islands

  	
   

  	
  280,000

  	
   

  	
  42,000

  	
   

  	
  10,500

  	
   

  
	
  York
  Investment Limited

  c/o Euro-Dutch Trust Company

  (Bahamas) Limited

  Charlotte House, Charlotte Street

  Nassau, Bahamas

  	
   

  	
  952,000

  	
   

  	
  142,800

  	
   

  	
  35,700

  	
   

  
	
  York Credit
  Opportunities Fund, L.P.

  390 Park Avenue 15th Floor

  New York, New York  10022

  EIN#: 13-4153848

  	
   

  	
  300,000

  	
   

  	
  45,000

  	
   

  	
  11,250

  	
   

  
	
  York Capital
  Management, L.P.

  390 Park Avenue, 15th Floor

  New York, New York  10022

  EIN#: 13-3625276

  	
   

  	
  248,000

  	
   

  	
  37,200

  	
   

  	
  9,300

  	
   

  
	
  Eleven Rings
  Opportunity Fund LP

  2965 Woodside Road

  Woodside, CA  94062

  	
   

  	
  250,000

  	
   

  	
  37,500

  	
   

  	
  9,375

  	
   

  
	
  New
  Generation Limited Partnership

  c/o New Generation Advisers, Inc.

  225 Friend Street, Suite 801

  Boston, Massachusetts  02114

  EIN: 04-3077323

  	
   

  	
  139,000

  	
   

  	
  20,848

  	
   

  	
  5,212

  	
   

  
	
  New
  Generation Turnaround Fund

  (Bermuda) Ltd.

  c/o Appleby Corporate Services

  (Bermuda) Ltd.

  Canon’s Court, 22 Victoria St.

  Hamilton HM EX, Bermuda

  Taxpayer ID: 98-0163822

  	
   

  	
  461,000

  	
   

  	
  69,148

  	
   

  	
  17,287

  	
   

  
	
  Phoenix
  Partners, L.P.

  c/o Morgens Waterfall

  600 Fifth Avenue

  New York, New York  10020

  EIN#: 13-6272912

  	
   

  	
  737,800

  	
   

  	
  110,668

  	
   

  	
  27,667

  	
   

  



 
















 


	
  Purchasers

  	
   

  	
  Shares

  Purchased

  	
   

  	
  Warrant Shares

  Purchased

  	
   

  	
  25% of Warrant

  Shares

  Purchased

  	
   

  
	
  Phoenix
  Partners II, L.P.

  c/o Morgens Waterfall

  600 Fifth Avenue

  New York, New York  10020

  EIN#: 84-1631449

  	
   

  	
  240,500

  	
   

  	
  36,072

  	
   

  	
  9,018

  	
   

  
	
  Phaeton
  International (BVI) Ltd

  c/oBISYS Hedge Fund Services (BVI)

  Limited

  Bison Court, Road Town

  Tortola, British

  Virgin Islands

  	
   

  	
  646,700

  	
   

  	
  97,004

  	
   

  	
  24,251

  	
   

  
	
  J.C.
  Waterfall

  One West 81st Street

  New York, New York

  SS#  ###-##-####

  	
   

  	
  375,000

  	
   

  	
  56,248

  	
   

  	
  14,062

  	
   

  
	
  Crosslink
  Crossover Fund IV, LP

  c/o Crosslink Capital

  Two Embarcadero Center

  Suite 2200  San Francisco, California
  94111

  EIN:  76-0737316

  	
   

  	
  1,110,000

  	
   

  	
  166,500

  	
   

  	
  41,625

  	
   

  
	
  Delta Growth

  c/o Crosslink Capital

  Two Embarcadero Center

  Suite 2200

  San Francisco,

  California 94111

  EIN:  94-3228612

  	
   

  	
  50,000

  	
   

  	
  7,500

  	
   

  	
  1,875

  	
   

  
	
  Offshore
  Crosslink Crossover Fund III

  c/o Crosslink Capital

  Two Embarcadero Center

  Suite 2200

  San Francisco, California 94111

  TIN:  98-0225068

  	
   

  	
  90,000

  	
   

  	
  13,500

  	
   

  	
  3,375

  	
   

  
	
  George W.
  Haywood

  81 Meredith Avenue

  Sag Harbor, New York 11963

  SS#:  ###-##-####

  	
   

  	
  1,000,000

  	
   

  	
  150,000

  	
   

  	
  37,500

  	
   

  
	
  Loeb
  Partners Corporation

  61 Broadway

  New York, New York  10006

  EIN: 13-3114801

  	
   

  	
  1,100,000

  	
   

  	
  165,000

  	
   

  	
  41,250

  	
   

  
	
  Miller
  Family Partnership I

  1201 Peachtree Street, N.E.

  Atlanta, Georgia 30361

  	
   

  	
  300,000

  	
   

  	
  45,000

  	
   

  	
  11,250

  	
   

  
	
  Millennium
  Partners L.P.

  Walkers, Walker House, Mary Street

  George Town, Grand Cayman,

  Cayman Islands

  EIN: 13-3521699

  	
   

  	
  1,000,000

  	
   

  	
  150,000

  	
   

  	
  37,500

  	
   

  



 
















 


	
  Purchasers

  	
   

  	
  Shares

  Purchased

  	
   

  	
  Warrant Shares

  Purchased

  	
   

  	
  25% of Warrant

  Shares

  Purchased

  	
   

  
	
  Greywolf
  Capital Partners II LP

  411 W. Putnam Ave., Suite 265

  Greenwich, Connecticut 06830

  EIN#: 54-2104239

  	
   

  	
  585,000

  	
   

  	
  87,748

  	
   

  	
  21,937

  	
   

  
	
  Greywolf
  Capital Overseas Fund

  Queensgate House, South Church

  Street

  Georgetown, Grand Cayman, Cayman

  Islands

  	
   

  	
  915,000

  	
   

  	
  137,248

  	
   

  	
  34,312

  	
   

  
	
  LC Capital
  Mater Fund, Ltd.

  Queensgate House, South Church

  Street

  Georgetown, Grand Cayman, Cayman

  Islands

  	
   

  	
  2,100,000

  	
   

  	
  315,000

  	
   

  	
  78,750

  	
   

  
	
  Singer
  Children’s Management Trust

  c/o Romulus Holdings, Inc.

  560 Sylvan Avenue

  Englewood Cliffs, New Jersey  07632

  EIN#: 22-6765093

  	
   

  	
  1,000,000

  	
   

  	
  150,000

  	
   

  	
  37,500

  	
   

  



 
















 


 


LIST OF EXHIBITS


 


	
  Exhibit A:

  	
   

  	
  Form of Warrant

  
	
  Exhibit B:

  	
   

  	
  Form of Investor Questionnaire

  
	
  Exhibit C:

  	
   

  	
  Form of Legal Opinion of Bingham McCutchen
  LLP

  
	
  Exhibit D:

  	
   

  	
  Form of Secretary’s Certificate

  
	
  Exhibit E:

  	
   

  	
  Form of Officer’s Certificate

  
	
  Exhibit F:

  	
   

  	
  Form of Transfer Agent Instructions

  
	
  Exhibit G:

  	
   

  	
  Form of Company Press Release