Document:

exv10w1

 

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ASSET PURCHASE AGREEMENT

dated as of May 2, 2008

by and among

RADIANT SYSTEMS, INC.,

JADEON, INC.,

VISTA.COM, INC.

and

INNUITY, INC.

 

 

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ASSET PURCHASE AGREEMENT

     This ASSET PURCHASE AGREEMENT (this “Agreement”) is entered into as of May 2, 2008, but
effective as of the Effective Time (as defined below), by and among RADIANT SYSTEMS, INC, a Georgia
corporation (“Purchaser”), JADEON, INC., a Nevada corporation (“Seller”), VISTA.COM, INC., a
Washington corporation (“Shareholder”), and INNUITY, INC., a Utah corporation (“Parent”).

RECITALS:

     WHEREAS, Seller is engaged in the business (the “Business”) of marketing and selling systems
(consisting of hardware and/or software) used for checkout, inventory management, labor management,
enterprise reporting, and configuration of point of sale data by end-users in the hospitality and
retail industries, and providing ongoing installation, training, consulting, maintenance and
support services for such systems; and

     WHEREAS, Seller desires to sell, transfer and assign to Purchaser, and Purchaser desires to
purchase and acquire from Seller, substantially all of the assets of Seller relating to the
operation of the Business, and in connection therewith, Purchaser has agreed to assume certain of
the liabilities of Seller relating to the Business, all on the terms set forth herein.

     NOW, THEREFORE, in consideration of the mutual covenants and agreements set forth in this
Agreement, and for other good and valuable consideration, the receipt and sufficiency of which are
hereby acknowledged, the parties hereto agree as follows:

ARTICLE I

SALE OF ASSETS AND CLOSING

          1.01 Assets.

          (a) Assets Transferred. On the terms and subject to the conditions set forth in this
Agreement, Seller will sell, transfer, convey, assign and deliver to Purchaser, and Purchaser will
purchase and pay for, at the Closing, free and clear of all Liens other than Permitted Liens, all
of Seller’s right, title and interest in, to and under all of the assets of Seller used in
connection with the Business, as the same shall exist on the Closing Date (collectively, the
“Assets”) including, without limitation, the following assets used in connection with the Business,
but specifically excluding the Excluded Assets (as such term is defined in Section
1.01(b)):

     (i) All equipment, machinery, furniture, fixtures and other tangible personal property
used in connection with the Business (“Tangible Personal Property”);

     (ii) All operating cash, commercial paper, certificates of deposit and other bank
deposits and other cash equivalents;

     (iii) All trade and other accounts receivable and all rights to receive payments
arising out of the conduct of the Business, including any rights of Seller with respect to

 

 

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any third party collection procedures or any other Actions or Proceedings which have
been commenced in connection therewith (the “Accounts Receivable”);

     (iv) All Inventory of Seller;

     (v) All Contracts to which Seller is a party and which are utilized in the conduct of
the Business, and all of the Assumed IT Contracts regardless of whether in the name of
Seller or Parent (collectively, the “Assumed Agreements”);

     (vi) All Intellectual Property used in the conduct of the Business on a worldwide
basis, including but not limited to all rights in and to the name “Jadeon”, all rights to
the domain names www.jadeon.com and www.jadeonPOS.com, and all rights in and to the website
currently operated by Seller at www.jadeon.com (collectively, the “Intellectual Property
Assets”);

     (vii) All transferable Licenses (including applications therefor) utilized in the
conduct of the Business;

     (viii) All Books and Records used or held for use in the conduct of the Business or
otherwise relating to the Assets;

     (ix) All rights of Seller under any claims, warranties, guaranties, refunds, causes of
action, rights of recovery, rights of set-off and rights of recoupment of every kind and
nature relating to the Business, other than those relating to the Excluded Assets or the
Retained Liabilities;

     (x) All unfilled customer orders relating to the Business and all deposits and other
payments relating thereto;

     (xi) All prepaid assets or advance payments relating to the Business (including without
limitation the Prepaid Microsoft Licenses (as defined in Section 4.08 below));

     (xii) All goodwill of the Business; and

     (xiii) All other assets and properties of Seller used or held for use in connection
with the Business, excluding the Excluded Assets.

          (b) Excluded Assets. Notwithstanding anything in this Agreement to the contrary, the
following assets and properties of Seller (the “Excluded Assets”) shall be excluded from and shall
not constitute Assets:

     (i) All of Seller’s right, title and interest in and to the Excluded Employment
Agreements;

     (ii) All of Seller’s right, title and interest in and to: (A) that certain Marketing
Agreement (also referenced as Agent Agreement and Independent Contractor

 

 

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Agreement) dated August 3, 2005 between Seller and Vista dba Merchant Partners; (B)
that certain SD VAR Agreement dated March 7, 2007 between Seller and Epson America, Inc.;
(C) that certain Reseller Agreement dated June 14, 2006 between Parent and ProphetLine, Inc;
and (D) the license agreement for Sugar Enterprise On-Site, licensed from Sugar CRM, Inc.

     (iii) All license agreements for software programs licensed from Microsoft Corporation
(other than in connection with the Assumed IT Contracts and the Prepaid Microsoft Licenses).

     (iv) All intercompany notes or other obligations payable to Seller by Parent,
Shareholder or its other Affiliates;

     (v) The minute books, stock transfer books and corporate seal of Seller;

     (vi) All Benefit Plans of Seller including all assets thereof;

     (vii) All casualty, liability or other policies of insurance maintained by or on behalf
of the Seller and the rights thereunder and all rights under self insurance programs; and

     (viii) Seller’s rights under this Agreement.

          1.02 Liabilities.

          (a) Assumed Liabilities. In connection with the sale, transfer, conveyance,
assignment and delivery of the Assets pursuant to this Agreement, on the terms and subject to the
conditions set forth in this Agreement, at the Closing, Purchaser will assume and agree to pay,
perform and discharge when due the following obligations of Seller arising in connection with the
operation of the Business, as the same shall exist on the Closing Date (collectively, the “Assumed
Liabilities”), and no others:

     (i) All obligations of Seller under the Assumed Agreements, so long as such obligations
have been incurred in the ordinary course of business consistent with past practices (but
specifically excluding liabilities for breaches thereof occurring on or prior to the Closing
Date, whether occurring as a result of the transactions contemplated by this Agreement or
otherwise).

     (ii) All liabilities of Seller to customers of the Business for warranty, maintenance
and support obligations, but only to the extent that such liabilities have been incurred in
the ordinary course of business and are reflected as liabilities on the Closing Date
Statement.

          (b) Retained Liabilities. The parties hereto expressly acknowledge and agree that,
except for the Assumed Liabilities, Purchaser shall not assume or incur, and Seller shall remain
liable to pay, perform and discharge, all liabilities and obligations of Seller (collectively, the
“Retained Liabilities”), including, without limitation, liabilities and obligations of Seller:

 

 

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(A) for Taxes owed by Seller to any Governmental Authority, (B) arising out of or in any way
connected with pending or threatened litigation, resulting from or in any way connected with the
operation of the Business prior to the Closing, whether or not disclosed to Purchaser (including
the matters disclosed in Section 2.10 of the Disclosure Schedule), (C) for violation by
Seller of any statute, ordinance, regulation, order, judgment or decree, (D) all intercompany notes
or other obligations owed by Seller to Parent, Shareholder or any other Affiliate of Seller, (E)
arising from or relating to any claims by or on behalf of present or former employees of Seller in
respect of severance pay or benefits or termination pay or benefits and similar obligations
relating to such employees’ employment with the Business through the Closing Date or the
termination of such employees’ employment with Seller, (F) under any Benefit Plan of Seller; (G)
arising from or relating to any Excluded Asset; (H) arising from or relating to any debt or
liabilities incurred by Seller prior to the Closing Date not included in the Assumed Liabilities;
(I) arising from or relating to any Excluded Employment Agreement (including without limitation the
Retention Bonus Obligations); (J) arising from or relating to any of the obligations of Parent,
Seller or Shareholder to Imperium Master Fund, Ltd. (“Imperium”) or Wells Fargo Bank, N.A. (“Wells
Fargo”) and (K) trade payables.

          1.03 Purchase Price. The total purchase price to be paid by Purchaser to Seller for
the Assets (the “Purchase Price”) shall be the sum of Seven Million Dollars ($7,000,000), subject
to adjustment pursuant to Section 1.04 below. Upon the terms and conditions set forth in
this Agreement, Purchaser shall pay the Purchase Price to Seller as follows:

          (a) At the Closing, Purchaser shall pay to Seller the Purchase Price minus the Escrow
Amount (as defined below) (the “Closing Date Payment”). The Closing Date Payment shall be
delivered by Purchaser to Seller in immediately available funds by wire transfer on the Closing
Date to one or more accounts designated by Seller in a written notice delivered to Purchaser prior
to the Closing Date. Notwithstanding the foregoing, prior to the Closing, Seller may direct
Purchaser to pay a portion of the Purchase Price to any holder of Indebtedness of Seller on
Seller’s behalf in order to cancel any Liens on the Assets (other than Permitted Liens).

          (b) At the Closing, Purchaser shall deliver Three Hundred and Seventy-Five Thousand Dollars
($375,000) (the “Escrow Amount”) by wire transfer of immediately available funds, to the Escrow
Agent, for the purpose of securing the Seller’s and Parent’s indemnification obligations pursuant
to Article VIII and to be held and released in accordance with the terms of this Agreement
and the Escrow Agreement.

          1.04 Purchase Price Adjustment.

          (a) On or before the Closing Date, Seller and Purchaser shall conduct an audit of Seller’s
Inventory to the extent that it can be observed without unreasonably disrupting the operation of
the Business. Within thirty (30) days following the Closing Date, Seller shall prepare a written
schedule of all items of Inventory as of the Closing Date that Purchaser was unable to observe as
part of the foregoing audit (the “Inventory Schedule”). The Inventory Schedule shall indicate the
condition of each item of Inventory included thereon.

          (b) Within forty five (45) calendar days following the Closing Date, Seller shall cause to be
prepared and shall deliver to Purchaser, along with the Inventory Schedule, a

 

 

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statement of Assets and Assumed Liabilities (the “Closing Date Statement”) based on the
balance sheet of Seller as of the Effective Time. The Closing Date Statement shall include only
the Assets and the Assumed Liabilities.

          (c) Except as set forth in the following sentence, the Closing Date Statement shall be
prepared in accordance with United States generally accepted accounting principles (“GAAP”) and, to
the extent not inconsistent therewith, the past practices of Seller applied on a consistent basis.
For purposes of the Closing Statement: (i) used Inventory that has been fully refurbished shall be
valued based upon the amount that it would sell for between a willing buyer and a willing seller
made at wholesale, neither being under any compulsion to buy or to sell and both having reasonable
knowledge of relevant facts; (ii) used Inventory that has been partially refurbished but requires
additional refurbishing by Purchaser shall be valued at fifty percent (50%) of the amount that it
would sell for between a willing buyer and a willing seller made at wholesale, neither being under
any compulsion to buy or to sell and both having reasonable knowledge of relevant facts; (iii) used
Inventory that has not been restored to merchantable condition, and is not capable of being so
restored without undue effort, shall be valued at zero; and (iv) Accounts Receivable aged over
ninety (90) days and not collected on the date that the Closing Date Statement is actually
finalized pursuant to subsection (f) below shall be valued at zero.

          (d) For purposes of this Agreement, the “Net Assets” means an amount equal to the difference
between the following: (i) the amount of the current Assets as set forth on the Closing Date
Statement; minus (ii) the Adjusted Assumed Liabilities Amount. For purposes of this Agreement, the
“Adjusted Assumed Liabilities Amount” means an amount equal to the Assumed Liabilities, reduced
by fifty percent (50%) of the amount of liabilities related to deferred revenue, and
increased by the amount of the upfront license fee in the amount of $7,633 required to be
paid by Purchaser to obtain a 12-month license agreement for 17 seats of Sugar Enterprise On-Site
from Sugar CRM, Inc. after Closing.

          (e) Based on the foregoing calculation of Net Assets above, if the amount of Net Assets is:
(i) a positive amount (i.e., greater than zero), then Purchaser shall pay Seller in cash the amount
of the Net Assets, and (ii) a negative amount (i.e., less than zero), Seller shall pay Purchaser in
cash the amount by which Net Assets are less than zero.

          (f) Purchaser shall have the right to review fully all work papers relating to the Closing
Date Statement in order to confirm that the Closing Date Statement has been determined as provided
herein. Purchaser shall complete its review within forty five (45) days after such determination
has been made available for review. If Purchaser believes that any adjustment should be made to
the Closing Date Statement in order for Net Assets to be determined in accordance with the
requirements of this Section, Purchaser shall give Seller written notice of such adjustments. If
Seller agrees with the proposed adjustments, the adjustments shall be made to the Closing Date
Statement. If there are proposed adjustments which are disputed by Seller, then the parties shall
negotiate in good faith to resolve all disputed adjustments. If, after a period of forty five (45)
days following the date on which Purchaser gives written notice of any proposed adjustments, any
such adjustments still remain disputed, the parties will jointly engage a mutually acceptable
independent accounting firm (the “Independent

 

 

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Accountant”) to resolve any remaining disputed adjustments in accordance with this Agreement,
and the decision of the Independent Accountant shall be final and binding on the parties hereto and
nonappealable. Any payment required hereunder shall be tendered within three (3) Business Days
after the earlier of the agreement of the parties on the amount thereof or a written notice of any
resolution of such amount has been given by the Independent Accountant to the parties hereunder.
Purchaser has the right, but not the obligation, to use the Escrow Amount to satisfy the obligation
of Seller with respect to the Purchase Price adjustment, if any. All fees and expenses of the
Independent Accountant incurred in connection with such resolution shall be split equally between
the parties.

          1.05 Third Party Consents. To the extent that any of the Assets are not assignable
without the consent, waiver or approval of another Person, this Agreement shall not constitute an
assignment or an attempted assignment of such Asset if such assignment or attempted assignment
would constitute a breach thereof. Seller and Purchaser shall, for the account of Purchaser, use
their respective commercially reasonable efforts to obtain such consents, waivers and approvals as
soon as practicable following the Closing Date and Purchaser shall cooperate with and assist Seller
to this end; provided, that Seller shall take no action to seek such consent, waiver or approval
without prior consultation with or approval by Purchaser. If any such consent, waiver or approval
shall not be obtained despite Seller’s commercially reasonable efforts to procure such consent,
waiver or approval, then Seller shall cooperate with Purchaser in any reasonable arrangement
designed to provide Purchaser with the benefits intended to be assigned to Purchaser with respect
to the underlying Asset, including, without limitation, enforcement of any and all rights of Seller
against the other party thereto arising out of the breach or cancellation thereof by such other
party or otherwise. If and only if such reasonable arrangement can be made, and except as
otherwise provided herein, Purchaser agrees to accept the burdens and perform the obligations
underlying such Asset. Furthermore, if the other party’s consent is subsequently obtained,
Purchaser shall at such time agree to assume all liabilities and obligations thereunder, except for
Retained Liabilities. If and to the extent that such arrangement cannot be made, Purchaser shall
have no obligation with respect to any such Asset.

          1.06 Allocation of Purchase Price. After the Closing, the parties agree to negotiate
in good faith and determine the allocation of the Purchase Price for the Assets. Each party hereto
agrees (i) that any such allocation shall be consistent with the requirements of Section 1060 of
the Code and the regulations thereunder, (ii) to complete jointly and to file separately Form 8594
with its Federal income tax return consistent with such allocation for the tax year in which the
Closing Date occurs, and (iii) that no party will take a position on any Tax return, before any
Governmental Authority charged with the collection of any such Tax or in any judicial proceeding,
that is in any manner inconsistent with the terms of any such allocation without the consent of the
other party.

          1.07 Closing; Effective Time.

          (a) The closing of the purchase and sale provided for herein (the “Closing”) shall take place
via facsimile and email simultaneously with the execution hereof. The date upon which the Closing
occurs shall be referred to herein as the “Closing Date.”

 

 

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          (b) Notwithstanding anything contained herein to the contrary, the Closing shall be effective
at 12:01 a.m. (Atlanta, Georgia time) on May 1, 2008 (the “Effective Time”), with the operation of
the Business from and after the Effective Time being for the account and benefit of, and at the
risk and expense of, Purchaser.

ARTICLE II

REPRESENTATIONS AND WARRANTIES OF SELLER, SHAREHOLDER AND PARENT

     Seller, Shareholder and Parent hereby jointly and severally represent and warrant to Purchaser
as follows, subject to the exceptions specifically disclosed in writing in the Disclosure Schedule,
the sections of which correspond to the Sections of this Agreement (or disclosed in any other
section, subsection or clause of the Disclosure Schedule; provided, that it is reasonably apparent
that such disclosure would be responsive to such other Section, subsection or clause of this
Article II):

          2.01 Organization of Seller. Each of Seller, Shareholder and Parent is a corporation
duly organized, validly existing and in good standing under the Laws of the jurisdiction of its
organization. Seller has full corporate power and authority to conduct the Business as and to the
extent now conducted and to own, use and lease its assets and properties used in the Business.
Seller is duly qualified, licensed or admitted to do business and is in good standing in all
jurisdictions where the Business is conducted, except where the failure to be so qualified or
licensed would not have a material adverse effect on the Business.

          2.02 Authority; Execution. Each of Seller, Shareholder and Parent has full corporate
power and authority to execute and deliver this Agreement and the Operative Agreements to which
they are a party, to perform their obligations hereunder and thereunder and to consummate the
transactions contemplated hereby and thereby. The execution and delivery by each of Seller,
Shareholder and Parent of this Agreement and the Operative Agreements to which they are a party,
and the performance by each of Seller, Shareholder and Parent of their obligations hereunder and
thereunder, have been duly and validly authorized by all requisite corporate action. This
Agreement has been duly and validly executed and delivered by each of Seller, Shareholder and
Parent and constitutes, and upon the execution and delivery by each of Seller, Shareholder and
Parent of the Operative Agreements to which they are a party, such Operative Agreements, assuming
the due authorization, execution and delivery of this Agreement and the Operative Agreements by
Purchaser, will constitute legal, valid and binding obligations of Seller, Shareholder and Parent
enforceable against them in accordance with their respective terms, subject to bankruptcy,
insolvency, fraudulent transfer, reorganization, moratorium and similar laws of general
applicability relating to creditors rights and to general principles of equity.

          2.03 Capitalization; Ownership of Subsidiaries. Parent owns all of the issued and
outstanding capital stock of Shareholder. Shareholder owns all of the issued and outstanding
shares of capital stock of Seller. The Assets do not include any shares of capital stock or any
other ownership interest in, or securities of, any corporation, partnership, joint venture or other
legal entity.

 

 

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          2.04 No Conflicts. The execution and delivery by each of Seller, Shareholder and
Parent of this Agreement do not, and the execution and delivery by each of Seller, Shareholder and
Parent of the Operative Agreements to which they are parties, the performance by each of Seller,
Shareholder and Parent of their respective obligations under this Agreement and such Operative
Agreements and the consummation of the transactions contemplated hereby and thereby will not:

          (a) conflict with or result in a violation or breach of any of the terms, conditions or
provisions of the articles or certificate of incorporation or bylaws of Seller, Shareholder or
Parent;

          (b) conflict with or result in a material violation or breach of any term or provision of any
Law or Order applicable to Seller, Shareholder, Parent or any of the Assets; or

          (c) except as disclosed in Section 2.04 of the Disclosure Schedule, (i) conflict with
or result in a material violation or breach of, (ii) constitute (with or without notice or lapse of
time or both) a default under, (iii) require Seller, Shareholder or Parent to obtain any consent,
approval or action of, make any filing with or give any notice to any Person as a result or under
the terms of, or (iv) result in the creation or imposition of any Lien upon Seller, Shareholder,
Parent or any of the Assets under, any Contract or License to which Seller, Shareholder or Parent
is a party or by which any of the Assets is bound.

          2.05 Governmental Approvals and Filings. Except as disclosed in Section 2.05 of
the Disclosure Schedule, no consent, approval or action of, filing with or notice to any
Governmental Authority on the part of Seller, Shareholder or Parent is required in connection with
the execution, delivery and performance of this Agreement or any of the Operative Agreements to
which they are parties or the consummation of the transactions contemplated hereby or thereby.

          2.06 Financial Information. Section 2.06 of the Disclosure Schedule sets forth
copies of Seller’s unaudited balance sheets and statements of income as of and for the fiscal years
ended December 31, 2007 and December 31, 2006 and as of and for the three-month period ended March
31, 2008 (collectively, the “Financial Statements”). The Financial Statements are true and
complete in all material respects and were prepared in accordance with GAAP and, to the extent not
inconsistent therewith, the past practices of Seller, consistently applied throughout the periods
indicated (subject to normal year-end adjustments and the omission of footnotes and other
presentation items). The Financial Statements were prepared from the Books and Records of Seller
and fairly and accurately set forth the results of operations and financial positions of the
Business, as of the dates and for the periods indicated. The Books and Records provided a fair and
accurate basis for the preparation of the Financial Statements delivered to Purchaser in accordance
with this Section.

          2.07 Absence of Changes. Except for the execution and delivery of this Agreement and
the transactions to take place pursuant hereto on or prior to the Closing Date, since the Most
Recent Balance Sheet Date, there has not been any material adverse change, or

 

 

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any event or development which, individually or together with other such events, could
reasonably be expected to result in a material adverse change, in the assets, liabilities,
financial condition, or results of operation of the Business. Without limiting the foregoing,
except as disclosed in Section 2.07 of the Disclosure Schedule, there has not occurred,
between the Most Recent Balance Sheet Date and the date hereof, any of the following:

          (a) any of the following outside the ordinary course of business, consistent with past
practice for the Business: (i) any increase in the salary, wages or other compensation of any
Employee whose annual salary is, or after giving effect to such change would be, $100,000 or more;
(ii) any establishment or modification of (A) targets, goals, pools or similar provisions in
respect of any fiscal year under any employment-related Contract or other compensation arrangement
with or for Employees, or (B) salary ranges, increase guidelines or similar provisions in respect
of any employment-related Contract or other compensation arrangement with or for Employees; or
(iii) any adoption, entering into or becoming bound by any Benefit Plan, employment-related
Contract or collective bargaining agreement, or amendment, modification or termination (partial or
complete) of any Benefit Plan, employment-related Contract or collective bargaining agreement,
except to the extent required by applicable Law;

          (b) except for Indebtedness that will be satisfied on or before the Closing and set forth on
Section 2.04 of the Disclosure Schedule, the incurrence by Seller of Indebtedness with
respect to the conduct of the Business;

          (c) any physical damage, destruction or other casualty loss (whether or not covered by
insurance) affecting any of the plant, real or personal property or equipment of any Seller used or
held for use in the conduct of the Business in an aggregate amount exceeding $25,000;

          (d) any material change in (i) any pricing, investment, accounting, financial reporting,
inventory, credit, allowance or Tax practice or policy of the Business or (ii) any method of
calculating any bad debt, contingency or other reserve of the Business for accounting, financial
reporting or Tax purposes;

          (e) any write-off or write-down of or any determination to write-off or write-down of any of
the Assets;

          (f) (i) any acquisition or disposition of any Assets, other than Inventory in the ordinary
course of business consistent with the past practice of the Business; or (ii) any creation or
incurrence of a Lien, other than a Permitted Lien, on any Assets;

          (g) any entering into, amendment, modification, termination (partial or complete) or granting
of a waiver under or giving any consent with respect to (i) any Contract which is required (or had
it been in effect on the date hereof would have been required) to be disclosed in the Disclosure
Schedule pursuant to Section 2.17 or (ii) any License;

 

 

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          (h) capital expenditures or commitments for additions to property,
plant or equipment used or held for use in the conduct of the Business constituting capital
assets in an aggregate amount exceeding $25,000;

          (i) any transaction with any officer, director or Affiliate of Seller;

          (j) any disposal of any rights to the use of any Intellectual Property, or disclosure to any
Person of any trade secret, formula, process or know-how not theretofore a matter of public
knowledge without obtaining an appropriate confidentiality agreement from such person;

          (k) any sale, assignment, transfer or license of any Intellectual Property, except for
nonexclusive licenses granted to customers in the ordinary course of business;

          (l) any entering into of a Contract to do or engage in any of the foregoing after the date
hereof; or

          (m) any other transaction involving or development affecting the Business or the Assets
outside the ordinary course of business consistent with past practice.

          2.08 No Undisclosed Liabilities. Except as reflected or reserved against in the Most
Recent Balance Sheet or as disclosed in Section 2.08 of the Disclosure Schedule, there are
no Liabilities against, relating to or affecting the Business or any of the Assets, other than
Liabilities incurred subsequent to the Most Recent Balance Sheet Date in the ordinary course of
business consistent with past practice which in the aggregate are not material to the assets,
liabilities, financial condition, or results of operation of the Business.

          2.09 Taxes.

          (a) Seller has timely paid all Taxes, and all interest and penalties due thereon and payable
by it for the Pre-Closing Tax Period which will have been required to be paid on or prior to the
Closing Date, the non-payment of which would result in a Lien on any Asset, would otherwise
adversely affect the Business or would result in Purchaser becoming liable or responsible therefor.

          (b) Seller has established, in accordance with generally accepted accounting principles
applied on a basis consistent with that of preceding periods, adequate reserves for the payment of,
and will timely pay all Tax liabilities, assessments, interest and penalties which arise from or
with respect to the Assets or the operation of the Business and are incurred in or attributable to
the Pre-Closing Tax Period, the non-payment of which would result in a Lien on any Asset, would
otherwise adversely affect the Business or would result in Purchaser becoming liable therefor.

          (c) Except as set forth on Section 2.09 of the Disclosure Schedule, Seller and its
Affiliates have filed on a timely basis (or have received a valid extension to file) with the

 

 

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appropriate Tax Authorities all Tax Returns applicable to the Business or the Assets, and all such
returns are true, correct, and complete in all respects.

          2.10 Legal Proceedings. Except as disclosed in Section 2.10 of the Disclosure
Schedule: (a) there are no Actions or Proceedings pending or, to the Knowledge of Seller,
Shareholder or Parent, threatened against, relating to or affecting Seller with respect to the
Business or any of the Assets; and (b) there are no Orders outstanding against Seller with respect
to the Business or the Assets.

          2.11 Compliance With Laws and Orders. Except as disclosed in Section 2.11 of the
Disclosure Schedule, Seller is not, nor has it at any time been, nor has it received any notice
that it is or has at any time been, in material violation of or in default under any Law or Order
applicable to the Business or the Assets.

          2.12 Employee Benefits; ERISA. Seller does not have any liability under, nor is it
subject to any Lien, restriction or other adverse right relating to, any “employee benefit plan”
(as defined in Section 3(3) of ERISA), including any multiemployer plans (as defined in Section
3(37) of ERISA) or any other bonus, deferred compensation, severance pay, pension, profit-sharing,
retirement, insurance stock purchase, stock option or other fringe benefit plan, arrangement or
practice maintained, or contributed to, by Seller for the benefit of any current or former
employees, officers or directors (collectively, the “Benefit Plans”) (i) that would affect in any
manner whatsoever Purchaser’s right, title and interest in, or right to use or enjoy (free and
clear of any Lien, other than Permitted Liens), the Assets, or (ii) that would result in the
assumption by or imposition on Purchaser of any liability other than liabilities expressly included
as Assumed Liabilities.

          2.13 Property.

          (a) Seller does not own any real property which is used in connection with the Business.
Section 2.13(a) of the Disclosure Schedule lists all leases of real property used in
connection with the Business. Except as set forth on Section 2.13(a) of the Disclosure
Schedule, with respect to all such leased real property, (i) all of such leases are in full
force and effect and are valid, binding and enforceable in accordance with their terms, (ii) no
consents are required by the landlords under the applicable leases to the transactions contemplated
by this Agreement and (iii) no default exists under such leases nor has any event occurred which,
with the giving of notice or the passage of time, or both, would constitute a default under such
leases.

          (b) Seller is in possession of and has good title to, or has valid leasehold interests in or
valid rights under Contract to use, all the Tangible Personal Property. All the Tangible Personal
Property is owned by Seller free and clear of all Liens, other than Permitted Liens, and is in good
working order and condition, ordinary wear and tear excepted, and its use complies with all
applicable Laws.

          2.14 Intellectual Property

          (a) Section 2.14(a) of the Disclosure Schedule sets forth a list of all patents,
patent applications, copyright registrations (and applications therefor), and trademark, trade

 

 

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name
and domain name registrations (and applications therefor) owned by Seller and used in the
Business. Each of the federal and state registrations relating to the foregoing Assets is
valid and in full force and effect. Section 2.14(a) of the Disclosure Schedule also sets
forth a list of any unregistered trademarks, trade names, service marks, brand names, logos or
other identifiers used in the Business.

          (b) Section 2.14(b) of the Disclosure Schedule sets forth a list of all material
Intellectual Property used in the Business and for which the Seller does not own all right, title
and interest (collectively, the “Third Party Technology”), and all license agreements or other
contracts pursuant to which the Seller has the right to use the Third Party Technology (the “Third
Party Licenses”). To the Knowledge of Seller, Shareholder or Parent, Seller has the lawful right
to use (free of any material restriction not expressly set forth in the Third Party Licenses) all
Third Party Technology that is used in the Business, and no royalties or other compensation is
payable for the right to use such Third Party Technology other than as expressly set forth in the
Third Party Licenses. Seller has not received notice that any party to any such license intends to
cancel, terminate or refuse to renew (if renewable) such license or to exercise or decline to
exercise any option or right thereunder, and Seller has used the Third Party Technology in
accordance with all of the terms of the Third Party Licenses. Seller is not in material breach of
any Third Party Licenses.

          (c) All the Intellectual Property Assets are owned by Seller free and clear of all Liens,
other than Permitted Liens. Except as set forth on Section 2.14(c) of the Disclosure
Schedule and other than nonexclusive licenses granted in the ordinary course of business,
Seller has not granted to any third party any rights or permissions to use any of the Intellectual
Property Assets. Seller has not received any notice or claim (whether written, oral or otherwise)
challenging Seller’s ownership or rights in the Intellectual Property Assets or claiming that any
other Person has any legal or beneficial ownership with respect thereto or challenging the validity
or enforceability of the Intellectual Property Assets. There are no pending or, to the Knowledge
of Seller, Shareholder or Parent, threatened Actions of Proceedings against Seller or its licensors
contesting the validity of, or Seller’s right to use, any of the Intellectual Property Assets.

          (d) Except as set forth in Section 2.14(d) of the Disclosure Schedule, Seller has
obtained an enforceable written assignment of all right, title and interest in and to each item of
the Intellectual Property Assets owned by Seller from each Person participating in the discovery,
development or creation of such item. Seller has no obligation to compensate, or to obtain the
consent of, any third party for the use of any item of the Intellectual Property Assets. All
employees, independent contractors, or other Persons who have had access to or participated in the
development in any of the Intellectual Property Assets owned by Seller have signed appropriate
confidentiality and non-disclosure agreements and, in the case of independent contractors,
appropriate work for hire agreements and assignments, sufficient to protect Seller’s ownership
rights in the Intellectual Property Assets and the unauthorized use or disclosure of same.

          (e) Neither Seller’s operation of the Business prior to Closing nor the Intellectual Property
Assets infringe, violate or interfere with or constitute a misappropriation of any right, title or
interest (including, without limitation, any patent, copyright, trademark or trade

 

 

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secret right)
held by any other Person. Seller has not received any notice or claim (whether
written, oral or otherwise) regarding any infringement, misappropriation, misuse, abuse or
other interference with any third party intellectual property or proprietary rights (including,
without limitation, infringement of any patent, copyright, trademark or trade secret right of any
third party) by either Seller’s operation of the Business or the Intellectual Property Assets.

          (f) To the Knowledge of Seller or Parent, no other Person is infringing or misappropriating
the Intellectual Property Assets.

          (g) Parent has prepaid the Microsoft Corporation Great Plains Version 8.0 software license
(but not the fee for the annual maintenance thereof) on behalf of Purchaser for the balance of the
current 12-month term.

          2.15 Privacy and Security Commitments. With respect to all privacy and security
commitments for Personally Identifiable Information or protected payment card information
associated with Seller’s customers (including applicable Laws, agreements, terms and conditions and
privacy certification license agreements applicable to such information) (collectively, the
“Commitments”): (i) Seller is in compliance with the Commitments; (ii) Seller has not received
inquiries from the Federal Trade Commission or any other Governmental Authority regarding the
Commitments; (iii) there are no pending or, to the Knowledge of Seller, Shareholder or Parent,
threatened Actions or Proceedings regarding the Commitments or compliance with the Commitments;
(iv) the Commitments have not been rejected by any applicable certification organization which has
reviewed the Commitments or to which any of the Commitments have been submitted; (v) no applicable
certification organization has found the Seller to be out of compliance with the Commitments; (vi)
neither the transactions contemplated hereunder nor the resulting transfers of Personally
Identifiable Information will constitute violations of the Commitments; (vii) the transactions
contemplated hereunder may be effected in accordance with the Commitments in the manner as agreed
by the parties; (viii) electronic mail distribution lists have been scrubbed prior to the date
hereof to remove email addresses associated with individuals who have opted out of receiving
commercial electronic mail messages; and (ix) there have been no security breaches with respect to
any of its products or related data resulting in unauthorized access to or acquisition of such
information.

          2.16 Accounts Receivable. All of the Accounts Receivable (a) represent arm’s length
sales actually made in the ordinary course of business, (b) are collectible in accordance with
their respective terms within six months following the Closing Date, and (c) are not subject to
counterclaim or set-off and are not in dispute (except, in the case of (b) and (c), for the amount
of any applicable existing reserves for uncollectibility, counterclaims and set-offs in amounts
that are not individually or in the aggregate material).

          2.17 Contracts.

          (a) Section 2.17(a) of the Disclosure Schedule (with paragraph references
corresponding to those set forth below) contains a true and complete list of each of the following
Contracts or other arrangements related to the Business (true and complete copies or, if none,
reasonably complete and accurate written descriptions of which, together with all amendments and
supplements thereto and all waivers of any terms thereof, have been delivered to Purchaser

 

 

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prior to
the execution of this Agreement) to which Seller is a party and by which any of the
Assets is bound:

     (i) (A) all Contracts (excluding Benefit Plans) providing for a commitment of
employment or consultation services for a specified or unspecified term to, or otherwise
relating to employment or the termination of employment of, any Employee, the name, position
and rate of compensation of each Employee party to such a Contract and the expiration date
of each such Contract; and (B) any written or unwritten representations, commitments,
promises, communications or courses of conduct (excluding Benefit Plans and any such
Contracts referred to in clause (A)) involving an obligation of Seller to make payments in
any year, other than with respect to salary in the ordinary course of business, to any
Employee;

     (ii) all Contracts with any Person containing any provision or covenant prohibiting or
limiting the ability of Seller to engage in any business activity or compete with any Person
in connection with the Business or prohibiting or limiting the ability of any Person to
compete with Seller in connection with the Business;

     (iii) all partnership, joint venture or other similar Contracts with any Person in
connection with the Business;

     (iv) all Contracts with clients or customers of the Business that involve the payment
or potential payment, pursuant to the terms of any such Contract, to Seller of $50,000 or
more annually;

     (v) all Licenses used or held for use in the Business;

     (vi) all Contracts with licensors, licensees, sales agencies or franchises with whom
Seller deals in connection with the Business;

     (vii) all Contracts to which Seller is a party or by which Seller is bound that relate
to the Intellectual Property Assets;

     (viii) all Contracts between or among Seller, on the one hand, and any officer,
director or Affiliate of Seller, on the other hand;

     (ix) all collective bargaining or similar labor Contracts;

     (x) all Contracts relating to Indebtedness of Seller;

     (xi) all Contracts relating to (A) the future disposition or acquisition of any assets
and (B) any merger or other business combination relating to the Business;

     (xii) all other Contracts with respect to the Business that (A) involve the payment or
potential payment, pursuant to the terms of any such Contract, by or to Seller of more than
$25,000 annually, and (B) cannot be terminated within thirty (30) days after giving notice
of termination without resulting in any material cost or penalty to Seller.

 

 

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          (b) Each Contract required to be disclosed in Section 2.17(a) of the Disclosure
Schedule is in full force and effect and constitutes a legal, valid and binding agreement,
enforceable in accordance with its terms, of each party thereto; and neither Seller nor, to the
Knowledge of Seller, Shareholder or Parent, any other party to such Contract is, or has received
notice that it is, in violation or breach of or default under any such Contract (or with notice or
lapse of time or both, would be in violation or breach of or default under any such Contract) in
any respect.

          (c) Except for the obligation to reimburse a customer of Seller for the prepayment of services
under an oral Contract with such customer, Seller is not bound by any oral Contracts with respect
to the Business that cannot be terminated within thirty (30) days after giving notice of
termination without resulting in any cost or penalty to Seller.

          (d) The Contracts listed as Items 6 and 7 in Section 2.17(a)(iv) of the Disclosure
Schedule: (i) contain only commercially reasonable terms that are generally consistent with
other written customer agreements of Seller; (ii) do not contain any economic provisions that are
reasonably likely to result in Purchaser generating a loss in connection with the performance
thereof following the Closing Date; and (iii) do not contain any exclusivity provisions or any
covenants prohibiting or limiting the ability of Seller or its Affiliates to engage in any business
activity or compete with any Person in connection with the Business.

          2.18 Affiliate Transactions. Except as disclosed in Section 2.18 of the
Disclosure Schedule, no officer, director or Affiliate of Seller (a) has any ownership
interest, directly or indirectly, in any competitor, supplier or customer of Seller, (b) has any
outstanding loan to or from Seller, or (c) is a party to or has any interest in any Contract with
Seller.

          2.19 Employees; Labor Relations.

          (a) Section 2.19(a) of the Disclosure Schedule contains a list of the name of each
Employee at the date hereof, together with such Employee’s position or function, annual base salary
or wages and any incentive or bonus arrangement with respect to such Employee in effect on such
date. Except as set forth on Section 2.19(a) of the Disclosure Schedule each Employee has
executed a nondisclosure agreement in the form provided to Purchaser. To the Knowledge of Seller,
Shareholder or Parent, no Employee is in violation of any agreement relating to the relationship of
such Employee with Seller.

          (b) Except as disclosed in Section 2.19(b) of the Disclosure Schedule, (i) no Employee
is presently a member of a collective bargaining unit and, to the Knowledge of Seller, Shareholder
or Parent, there are no threatened or contemplated attempts to organize for collective bargaining
purposes any of the Employees, and (ii) no unfair labor practice complaint or sex, age, race or
other discrimination claim has been brought against Seller with respect to the conduct of the
Business before the National Labor Relations Board, the Equal Employment Opportunity Commission or
any other Governmental or Regulatory Authority. Seller is in material compliance with all
applicable Laws relating to the employment of labor, including, without limitation those relating
to wages, hours and collective bargaining with respect to the Employees.

 

 

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          2.20 Orders; Commitments; Warranties and Returns. Section 2.20 of the Disclosure
Schedule sets forth Seller’s warranties currently made with respect to the Business, and
current policies with respect to returns of products. Except as set forth in Section 2.20 of
the Disclosure Schedule, there are no pending or, to the Knowledge of Seller, Shareholder or
Parent, threatened claims against it for warranty costs exceeding the reserve for such costs set
forth on the Most Recent Balance Sheet. As used above, the term “warranty cost” shall mean costs
and expenses associated with correcting, returning or replacing defective or allegedly defective
products or services, whether such costs and expenses arise out of claims sounding in warranty,
contract, tort or otherwise.

          2.21 Inventory. The Inventory Schedule to be delivered pursuant to Section
1.04 above will accurately reflect all items of Inventory as of the Closing Date that Purchaser
was unable to observe as part of its audit, as well as the condition of each item of Inventory
included thereon. All Inventory consists of a quality and quantity usable and salable in the
ordinary course of business consistent with past practice, subject to normal and customary
allowances in the industry for damage and outdated items and reasonable wear and tear. None of the
items included in the Inventory are held by Seller on consignment from other Persons.

          2.22 Substantial Customers. Section 2.22 of the Disclosure Schedule lists the
ten (10) largest customers of the Business, on the basis of aggregate revenues of customers and
their Affiliates and franchisees for the most recently-completed fiscal year. Except as disclosed
in Section 2.22 of the Disclosure Schedule, no such customer has ceased or materially
reduced its purchases from the Business since the Most Recent Balance Sheet Date, or to the
Knowledge of Seller, Shareholder or Parent, has threatened to cease or materially reduce its
purchases after the date hereof.

          2.23 Title to and Sufficiency of Assets. Except as set forth on Section 2.23 of
the Disclosure Schedule, Seller has good and marketable title to the Assets free and clear of
all Liens other than Permitted Liens. The sale of the Assets by Seller to Purchaser pursuant to
this Agreement will effectively convey to Purchaser the entire Business and all of the tangible and
intangible assets and property used by Seller (whether owned, leased or held under license by
Seller, by any of Seller’s Affiliates or by others) in connection with the conduct of the Business
as conducted by Seller as of the date of this Agreement (except for the Excluded Assets).

          2.24 Brokers. Except as disclosed in Section 2.24 of the Disclosure Schedule,
all negotiations relative to this Agreement and the transactions contemplated hereby have been
carried out by Seller directly with Purchaser without the intervention of any Person on behalf of
Seller in a manner as to give rise to any valid claim by any Person against Purchaser for a
finder’s fee, brokerage commission or similar payment.

          2.25 No Other Representations or Warranties. Except for the representations and
warranties contained in this Article II, Purchaser acknowledges that none of Seller,
Parent, Shareholder nor any other Person on behalf of Seller, Shareholder or Parent makes any other
express or implied representation or warranty with respect to the Business, the Assets or the
Assumed Liabilities, or with respect to any other information provided to Purchaser or any other
Person on behalf of Purchaser, and Seller, Shareholder and Parent hereby disclaim any other

 

 

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representations or warranties made by Seller or any other Person on behalf of Seller, Shareholder
or Parent with respect to the execution and delivery of this Agreement or the transactions
contemplated hereby. None of Seller, Shareholder, Parent nor any other Person will have or be
subject to any liability or indemnification obligation to Purchaser or any other Person resulting
from the distribution to, or use by, Purchaser or any other Person on behalf of Purchaser of any
information provided to Purchaser or any such Person by Seller, Shareholder, Parent or by any
Person on behalf of Seller, Shareholder or Parent, including any information, documents,
projections, forecasts, business plans or other material made available in Purchaser’s diligence
investigation, any confidential information memoranda or any management presentations in
expectation of the transactions contemplated by this Agreement, unless such information is
expressly set forth in a representation or warranty contained in Article II of this
Agreement.

ARTICLE III

REPRESENTATIONS AND WARRANTIES OF PURCHASER

     Purchaser hereby represents and warrants to Seller, Shareholder and Parent as follows:

          3.01 Organization. Purchaser is a corporation duly organized and validly existing
under the Laws of the jurisdiction of its organization.

          3.02 Authority. The execution and delivery by Purchaser of this Agreement and the
Operative Agreements to which it is a party, and the performance by Purchaser of its obligations
hereunder and thereunder, have been duly and validly authorized by the Board of Directors of
Purchaser, no other corporate action on the part of Purchaser being necessary. This Agreement has
been duly and validly executed and delivered by Purchaser and, assuming the due authorization,
execution and delivery of this Agreement and the Operative Agreements by Seller, Shareholder and
Parent, constitutes, and upon the execution and delivery by Purchaser of the Operative Agreements
to which it is a party, such Operative Agreements will constitute, legal, valid and binding
obligations of Purchaser enforceable against Purchaser in accordance with their respective terms,
subject to bankruptcy, insolvency, fraudulent transfer, reorganization, moratorium and similar laws
of general applicability relating to creditors rights and to general principles of equity.

          3.03 No Conflicts. The execution and delivery by Purchaser of this Agreement do not,
and the execution and delivery by Purchaser of the Operative Agreements to which it is a party, the
performance by Purchaser of its obligations under this Agreement and such Operative Agreements and
the consummation of the transactions contemplated hereby and thereby will not: (a) conflict with or
result in a violation or breach of any of the terms, conditions or provisions of the organizational
documents of Purchaser; or (b) conflict with or result in a violation or breach of any term or
provision of any Law or Order applicable to Purchaser.

          3.04 Governmental Approvals and Filings. No consent, approval or action of, filing
with or notice to any Governmental Authority on the part of Purchaser is required in connection
with the execution, delivery and performance of this Agreement or the Operative Agreements to which
it is a party or the consummation of the transactions contemplated hereby or thereby.

 

 

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          3.05 Legal Proceedings. There are no Actions or Proceedings pending or, to the
Knowledge of Purchaser, threatened against, relating to or affecting Purchaser or any of its
assets and properties which could reasonably be expected to result in the issuance of an Order
restraining, enjoining or otherwise prohibiting or making illegal the consummation of any of the
transactions contemplated by this Agreement or any of the Operative Agreements.

          3.06 Brokers. All negotiations relative to this Agreement and the transaction
contemplated hereby have been carried out by Purchaser directly with Seller, Shareholder and Parent
without the intervention of any Person on behalf of Purchaser in a manner as to give rise to any
valid claim by any Person against Seller, Shareholder or Parent for a finder’s fee, brokerage
commission or similar payment.

          3.07 Financial Capacity. Purchaser has as of the date of this Agreement and on the
Closing Date will have sufficient immediately available funds to pay the Purchase Price and any
other obligations of Purchaser arising under, or in connection with, this Agreement and any
transactions contemplated hereby.

          3.08 No Other Information. Purchaser acknowledges and agrees that Seller, Shareholder
and Parent make no representation or warranty as to any matter whatsoever, except as expressly set
forth in Article II. The representations and warranties set forth in Article II
are made solely by Seller, Shareholder and Parent, and no other Person shall have any
responsibility or liability related thereto.

          3.09 Access to Information; Disclaimer. Purchaser acknowledges and agrees that it
(a) has had an opportunity to discuss the Business with the management of Seller, Shareholder and
Parent, (b) has had reasonable access to (i) the books and records of the Business, and
(ii) diligence materials provided by Seller, Shareholder and Parent or their representatives for
purposes of the transactions contemplated by this Agreement, (c) has been afforded the opportunity
to ask questions of and receive answers from the management of Seller, Shareholder and Parent,
(d) has conducted its own independent investigation of Seller, Shareholder, Parent and their
respective businesses, the Business, the Assets, the Assumed Liabilities and the transactions
contemplated hereby, and Purchaser has not relied on any representation, warranty or other
statement by any Person on behalf of Seller, Shareholder or Parent, other than the representations
and warranties of Seller, Shareholder and Parent expressly contained in Article II, and
(e) any and all representations and warranties made by or on behalf of Seller, Shareholder, Parent
or any other Person, other than the representations and warranties of Seller, Shareholder and
Parent expressly contained in Article II, are specifically disclaimed. It is agreed and
acknowledged that nothing in this Article III shall in any way diminish or affect the
validity of Seller’s, Shareholder’s and Parent’s representations and warranties set forth in
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ARTICLE IV

POST-CLOSING COVENANTS AND AGREEMENTS

          4.01 Further Assurances; Post-Closing Cooperation. At any time or from time to time
after the Closing, at Purchaser’s request, without further consideration, Seller, Shareholder and
Parent shall execute and deliver to Purchaser such other instruments of sale,
transfer, conveyance, assignment and confirmation, provide such materials and information and
take such other actions as Purchaser may reasonably deem necessary or desirable in order more
effectively to transfer, convey and assign to Purchaser, and to confirm Purchaser’s title to, all
of the Business and the Assets, and, to the fullest extent permitted by Law, to put Purchaser in
actual possession and operating control of the Assets and to assist Purchaser in exercising all
rights with respect thereto, and otherwise to cause Seller, Shareholder and Parent to fulfill their
respective obligations under this Agreement and the Operative Agreements.

          4.02 Public Announcements. No party hereto will issue any press release or make any
other public announcement relating to the transactions consummated pursuant to this Agreement
without the prior consent of the other parties hereto, except that a party may make any disclosure
required to be made under applicable law or stock exchange or NASDAQ rule if such party determines
in good faith that it is necessary to do so and, if practicable, gives prior notice to the other
parties.

          4.03 Tax Cooperation. The parties agree to furnish or cause to be furnished to each
other, upon request, as promptly as practicable, such information and assistance relating to the
Business and the Assets (including, without limitation, access to Books and Records) as is
reasonably necessary for the preparation and filing of all Tax returns, the making of any election
relating to Taxes, the preparation for any audit by any Governmental Authority, and the prosecution
or defense of any claim, suit or proceeding relating to any Tax. The parties shall cooperate with
each other in the conduct of any audit or other proceeding relating to Taxes involving the Assets
or the Business.

          4.04 Transfer Taxes. All excise, sales, use, value added, registration, stamp,
recording, documentary, conveyancing, franchise, transfer and similar Taxes, levies, charges and
fees (collectively, “Transfer Taxes”) incurred in connection with the transactions contemplated by
this Agreement shall be borne equally by Purchaser on the one hand and Seller, Shareholder and
Parent on the other hand. The parties shall cooperate in providing each other with any appropriate
resale exemption certifications and other similar documentation.

          4.05 Employee and Employee Benefit Matters.

          (a) Purchaser shall have no obligation to offer employment to, or employ, any Employees and,
except as expressly set forth in this subsection (a) below, Purchaser shall have no liability in
respect of any such Employees for salary, compensation, severance, stock options or stock option
plans, health, welfare, retirement or other benefits arising out of employment with Seller.
Purchaser shall have the right, in its sole discretion, to offer employment to any Employee.
Parent, Shareholder and Seller shall jointly and severally indemnify and hold Purchaser harmless
against any and all damages, losses and liabilities (including costs and attorneys’ fees incurred)
arising from any Actions or Proceedings commenced by or on behalf of any Seller’s Employees and
based upon Purchaser’s decision to not offer employment to, or employ, any of Seller’s Employees
(including but not limited to Mark LeMay, Patsy Taylor, John Bergin, Floyd (Larry) Martori and
Geoff Hayden). Notwithstanding the foregoing,

 

 

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Purchaser agrees to reimburse Parent and Seller for
$35,134.00 of out-of-pocket severance costs paid to Geoff Hayden in connection with the termination
of his employment; provided, that, the
total amount of severance paid to Geoff Hayden by Parent and Seller shall be no less than
$40,000.00 in the aggregate.

          (b) Except as provided in the Services Agreement, Seller shall advise all Employees that their
employment with Seller shall terminate effective as of the close of business on the Closing Date.
Any Employees that accept offers of employment from Purchaser (“New Purchaser Employees”) shall be
hired by Purchaser effective May 3, 2008. Except to the extent addressed in the Closing Date
Statement, Purchaser shall reimburse Parent for the out-of-pocket costs associated with Parent
employing any New Purchaser Employees during the period beginning as of the Effective Time and
ending on the close of business on the Closing Date.

          (c) For a period beginning on the Closing Date and ending on May 31, 2008 (the “Benefit
Coverage Period”), Parent, Shareholder and Seller shall arrange for Employees of Seller (regardless
of whether employed by Purchaser) to continue to be covered by and receive benefits under the
medical, dental, vision, life, and disability insurance programs covering such employees
immediately before the Closing Date. Purchaser shall reimburse Parent for the out-of-pocket costs
associated with providing such coverage solely for New Purchaser Employees. Except to the extent
that an Employee is participating in a Seller benefit plan during the Benefit Coverage Period in
accordance with the preceding sentence, Employees of Seller that are hired by Purchaser shall be
eligible to participate in Purchaser’s Benefit Plans.

          (d) Except for Employees hired by Purchaser following the Closing Date, Seller shall be
responsible for providing COBRA continuation coverage to all Employees of Seller, including their
spouses and dependents, who lose coverage under any group health plan maintained, administered or
sponsored by the Seller, as a result of the transactions contemplated herein.

          (e) Seller shall be responsible for providing any notice of layoff or plant closings required,
and any severance pay or other liabilities or obligations to Employees under the Worker Adjustment
and Retraining Notification Act of 1988 (“WARN”), any successor federal law, and any applicable
foreign, state or local plant closing notification statute. Parent, Shareholder and Seller shall
jointly and severally indemnify and hold Purchaser harmless against any and all damages, losses and
liabilities associated with or related to Seller’s failure to comply with WARN and such other laws.

          (f) Seller agrees to provide Purchaser with the personnel records (but specifically excluding
medical information, results of background investigations and other information which Seller is
prohibited by Law from providing to Purchaser (collectively, “Excluded Information”)) of any
Employee hired by Purchaser, but only after Purchaser hires that Employee. If any Excluded
Information is inadvertently disclosed by Seller to Purchaser, Purchaser agrees not to utilize the
information in making any personnel decisions and to promptly return the information upon
Purchaser’s discovery of the information or upon Seller’s request for its return. Purchaser agrees
to indemnify Parent, Shareholder and Seller against any and all liability, cost, damage and
expense, including without limitation, costs and attorney fees,

 

 

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relating to or resulting from
Seller’s provision of these personnel records to Purchaser or Purchaser’s use or disclosure of
information contained in the personnel records.

          4.06 Covenants Against Competition.

          (a) In order to induce Purchaser to enter into this Agreement and consummate the transactions
contemplated hereby, Seller, Shareholder and Parent jointly and severally covenant and agree that
they will not, nor will their respective Affiliates controlled by Seller, Shareholder or Parent,
without the prior written consent of Purchaser, for their own account or jointly with another,
directly or indirectly, for or on behalf of any Person, as principal, agent, shareholder,
participant, partner, promoter, director, officer, manager, employee, consultant, sales
representative or otherwise, except for the benefit of the Purchaser or its Affiliates:

     (i) for a period of five (5) years from the date of the Closing, engage or invest in,
or own, control, manage or participate in the ownership, control or management of, or render
services or advice to, any business engaged in the Business in the Restricted Territory;
provided, that, nothing contained in this subsection (i) shall be deemed to prohibit
Shareholder, Parent or their Affiliates from continuing to engage in a business engaged
exclusively in one or more of the following activities: (A) pay-per-click marketing, (B)
search engine submission and optimization, (C) professional website development and
implementation services, (D) credit card transaction and merchant processing hardware,
software and related services, whether delivered in a “Software as a Service” platform or
otherwise or (E) marketing and selling systems (consisting of hardware and/or software) used
for inventory management, labor management or enterprise reporting, but only to the extent
that such systems are not bundled with or otherwise sold in conjunction with point-of-sale
systems (collectively, the “Parent Retained Businesses”);

     (ii) for a period of five (5) years from the date of the Closing, solicit, or assist in
the solicitation of, any Person having an office or place of business within the Restricted
Territory and to whom Seller sold or provided any products or services related to the
Business on, or during the two (2) year period prior to, the date of the Closing, for the
purpose of obtaining the patronage of such Person for the purchase of any products or
services competitive to the Business, except to the extent Shareholder, Parent or any of
their Affiliates is soliciting or assisting in the solicitation of such a Person for the
purpose of obtaining the patronage of such Person for any of the Parent Retained Businesses;

     (iii) for a period of five (5) years from the date of the Closing, (A) solicit, or
assist in the solicitation of, for the purpose of offering employment to or hiring, or (B)
actually hire, any Person employed by Purchaser (as an employee, independent contractor or
otherwise) that was formerly an Employee of the Business; provided that Seller shall not be
prevented from making any general solicitation of employment (that is not specifically
targeted at Purchaser or its employees), or from hiring any Person who responds to such a
general solicitation; or

     (iv) use, disclose or reveal to any Person, any Confidential Information (as defined
below) of the Purchaser; provided, however, that the obligations of this clause

 

 

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(iv) shall
terminate with respect to any business information that does not constitute a trade secret
under applicable Law upon the expiration of five (5) years after the date of the Closing.

          (b) Notwithstanding anything contained in this Agreement to the contrary, Seller, Shareholder
and Parent acknowledge and agree that Purchaser’s remedy at law for a breach or threatened breach
of any of the provisions of this Section would be inadequate and, in recognition of that fact, in
the event of a breach or threatened breach by Seller, Shareholder or Parent of the provisions of
this Section, it is agreed that, in addition to its remedies at law, Purchaser shall be entitled to
equitable relief in the form of specific performance, temporary restraining order, temporary,
preliminary, or permanent injunction, or any other equitable remedy which may then be available.
Seller, Shareholder and Parent agree not to oppose Purchaser’s request for any of the above relief
on the grounds that Purchaser has not been irreparably injured or that Purchaser has an adequate
remedy at law or that such equitable relief is inappropriate. Nothing set forth in this Section
shall be construed as prohibiting Purchaser from pursuing any other rights and remedies available
to it for such breach or threatened breach.

          4.07 Termination of Radiant Agreements.

          (a) Purchaser and Seller agree that effective upon Closing, the Radiant Reseller Agreement
dated August 16, 2005 (“Radiant Reseller Agreement”) between Radiant Hospitality Systems, Ltd., a
wholly owned subsidiary of Purchaser, and Seller shall be terminated. All provisions of such
Radiant Reseller Agreement intended to survive the termination of the Radiant Reseller Agreement
shall continue in full force and effect, as contemplated by Section 19.8 of the Radiant Reseller
Agreement. Purchaser agrees to cause Radiant Hospitality Systems, Inc. to take all steps necessary
to effect the cancellation of the Radiant Reseller Agreement.

          (b) Purchaser and Seller agree that effective upon Closing, the Contractor Agreement dated
July 20, 2005 between the Purchaser and Seller (the “Radiant Contractor Agreement”) shall be
terminated. All provisions of such Radiant Contractor Agreement intended to survive the
termination of the Radiant Contractor Agreement shall continue in full force and effect, as
contemplated by Section 10.2 of the Radiant Contractor Agreement.

          4.08 Certain Microsoft Software Licenses. Parent has prepaid the following Microsoft
Corporation software licenses on behalf of Purchaser for a period of 18 months after Closing: 175
licenses for Office Pro, Windows Business/Pro, and Server Core CAL (collectively, the “Prepaid
Microsoft Licenses”). Parent agrees that it will take all actions reasonably required from and
after Closing to cause Microsoft to register the Prepaid Microsoft Licenses in the name of
Purchaser. Except in connection with the Prepaid Microsoft Licenses and the Assumed IT Contracts,
Parent and Seller are not assigning, and Purchaser is not assuming, any rights, duties or
obligations of Parent or Seller for software programs licensed from Microsoft Corporation.

          4.09 Seller Guaranties. The Purchaser will use commercially reasonable efforts to
obtain the release of Mark LeMay’s personal guarantee of any applicable Assumed Agreement.

 

 

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          4.10 Use of Name. Within ten (10) Business Days after Closing, Seller shall file an
amendment with the Secretary of State of Nevada to its Certificate of Incorporation to change its
name to a name that does not include “Jadeon”. From and after the Closing, neither
Parent, Shareholder nor Seller shall use, directly or indirectly, the name “Jadeon” or any
confusingly similar name.

          4.11 Tax Lien. Within 30 days following the Closing Date, Parent will deliver to
Purchaser evidence of termination of an outstanding tax lien in favor of Orange County, California
filed October 9, 2007 in the amount of $990.87.

ARTICLE V

CLOSING DELIVERIES OF SELLER AND PARENT

     On or prior to the Closing Date, Seller, Shareholder and Parent shall deliver the following
items (or cause such items to be delivered) to Purchaser:

          5.01 Assignment Instruments. (i) A Bill of Sale in form and substance reasonably
acceptable to Purchaser (the “Bill of Sale”), duly executed by Seller; and (ii) such other good and
sufficient instruments of conveyance, assignment and transfer, in form and substance reasonably
acceptable to Purchaser, as shall be effective to vest in Purchaser good title to the Assets (free
and clear of all Liens, other than Permitted Liens) (collectively, the “Assignment Instruments”);

          5.02 Third Party Consents. All third party consents set forth on Schedule
5.02 attached hereto;

          5.03 Opinion of Counsel. The opinion of Parr Waddoups Brown Gee & Loveless, Utah
counsel to Seller and Parent, dated as of the Closing Date;

          5.04 Certain Agreements. Signed (a) Lockup and Voting Agreements from holders of no
less than 50.01% of the outstanding shares of Parent’s capital stock; (b) Employment Agreements
from each of Stephen Ferrante and Ralph Rudzik; and (c) Confidentiality, Non-Competition and
Non-Solicitation Agreement from Mark LeMay and John Wall.

          5.05 Services Agreement. A signed Services Agreement from Parent.

          5.06 Escrow Agreement. A signed Escrow Agreement from Seller.

          5.07 Resolutions. Copies of signed corporate resolutions of the Board of Directors
and sole shareholder of Seller authorizing the execution and delivery of this Agreement and the
consummation of the transactions contemplated by this Agreement.

          5.08 Payment of Indebtedness. A pay-off letter from Imperium with regard to the
outstanding Indebtedness of Parent and Seller.

 

 

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ARTICLE VI

CLOSING DELIVERIES OF PURCHASER

     On or prior to the Closing Date, Purchaser shall deliver the following items (or cause such
items to be delivered) to Seller, Shareholder and Parent:

          6.01 Closing Date Payment. Purchaser shall deliver the Closing Date Payment to Seller
in accordance with Section 1.03(a) above.

          6.02 Assumption Agreement. Purchaser will assume from Seller the due and punctual
payment, performance and discharge of the Assumed Liabilities by delivery of an Assumption
Agreement in form and substance reasonably acceptable to Seller (the “Assumption Agreement”).

          6.03 Resolutions. Copies of signed corporate resolutions of the Board of Directors of
Purchaser authorizing the execution and delivery of this Agreement and the consummation of the
transactions contemplated by this Agreement.

ARTICLE VII

SURVIVAL OF REPRESENTATIONS, WARRANTIES,

COVENANTS AND AGREEMENTS

     Notwithstanding any right of Purchaser (whether or not exercised) to investigate the Business
or any right of any party (whether or not exercised) to investigate the accuracy of the
representations and warranties of the other party contained in this Agreement, Purchaser has the
right to rely upon the representations and warranties of Seller, Shareholder and Parent contained
in this Agreement. The representations and warranties of the parties contained in Article II
and Article III of this Agreement will survive the Closing until the date which is
eighteen (18) months after the Closing Date, except that (a) the representations and warranties
contained in Sections 2.09 (Taxes), 2.12 (Employee Benefits; ERISA), 2.14 (Intellectual
Property) and 2.15 (Privacy and Security Commitments) shall survive until the later of the date
which is eighteen (18) months after the Closing Date and the expiration of the applicable statutes
of limitations, and (b) the representations and warranties contained in Section 2.23 (Title to
and Sufficiency of Assets) shall survive indefinitely. Notwithstanding the foregoing, any
representation or warranty that would otherwise terminate will continue to survive if a Claim
Notice or Indemnity Notice (as applicable) shall have been timely given under Article VIII
on or prior to such termination date, until the related claim for indemnification has been
satisfied or otherwise resolved as provided in Article VIII. The covenants and agreements
of the parties contained in or made pursuant to this Agreement shall survive the Closing to the
extent such covenant or agreement is to be performed or complied with at or following the Closing
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ARTICLE VIII

INDEMNIFICATION

          8.01 Indemnification.

          (a) Subject to the other Sections of this Article VIII, Seller, Shareholder and Parent
shall jointly and severally indemnify the Purchaser Indemnified Parties in respect of, and
hold each of them harmless from and against, any and all Losses suffered, incurred or
sustained by any of them or to which any of them becomes subject, resulting from, arising out of or
relating to (i) any misrepresentation or breach of warranty on the part of Seller, Shareholder or
Parent contained in Article II of this Agreement (calculated without regard to any
materiality qualifications contained in any such representations and warranties); (ii) any
non-fulfillment of or failure to perform any covenant or agreement on the part of Seller,
Shareholder or Parent contained in this Agreement; (iii) any Loss suffered by Purchaser from the
operation of the business prior to the Closing Date (other than Losses relating to Assumed
Liabilities); (iv) any failure of Seller to transfer the Assets to Purchaser free and clear of all
Liens (other than Permitted Liens); (v) any actual or alleged failure of Seller to comply with
Section 16-10a-1202 of the Utah Revised Business Corporation Act; or (vi) the actual or threatened
failure to receive the landlord’s consent to assignment under that certain Commercial Lease by and
between the Kelly L. Sapp Trust, as landlord, and Seller for the office located at 17841 Mitchell
North, Irvine, California.

          (b) Subject to the other Sections of this Article VIII, Purchaser shall indemnify the
Seller Indemnified Parties in respect of, and hold each of them harmless from and against, any and
all Losses suffered, incurred or sustained by any of them or to which any of them becomes subject,
resulting from, arising out of or relating to (i) any misrepresentation or breach of warranty on
the part of Purchaser contained in Article III of this Agreement (calculated without regard
to any materiality qualifications contained in any such representations and warranties); (ii) any
non-fulfillment of or failure to perform any covenant or agreement on the part of Purchaser
contained in this Agreement; or (iii) any Loss suffered by Seller, Shareholder or Parent from the
operation of the Business after the Closing Date (other than Losses relating to Retained
Liabilities).

          8.02 Method of Asserting Claims. All claims for indemnification by any Indemnified
Party under Section 8.01 will be asserted and resolved as follows:

          (a) In the event any claim or demand in respect of which an Indemnified Party might seek
indemnity under Section 8.01 is asserted against or sought to be collected from such
Indemnified Party by a Person other than a Purchaser Indemnified Party or Seller Indemnified Party
(a “Third Party Claim”), the Indemnified Party shall deliver a Claim Notice with reasonable
promptness to the Indemnifying Party. If the Indemnified Party fails to provide the Claim Notice
with reasonable promptness after the Indemnified Party receives notice of such Third Party Claim,
the Indemnifying Party will not be obligated to indemnify the Indemnified Party with respect to
such Third Party Claim, but only to the extent that the Indemnifying Party’s ability to defend has
been irreparably prejudiced by such failure of the Indemnified Party. The Indemnifying Party will
notify the Indemnified Party as soon as practicable within the Dispute Period whether the
Indemnifying Party disputes its liability to the Indemnified Party under Section 8.02 and
whether the Indemnifying Party desires, at its sole cost and expense, to defend the Indemnified
Party against such Third Party Claim.

     (i) If the Indemnifying Party notifies the Indemnified Party within the Dispute Period
that the Indemnifying Party desires to defend the Indemnified Party with

 

 

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respect to the
Third Party Claim pursuant to this Section 8.02(a), then the Indemnifying Party will
have the right to defend, with counsel reasonably satisfactory to the
Indemnified Party, at the sole cost and expense of the Indemnifying Party, such Third
Party Claim by all appropriate proceedings, which proceedings will be reasonably, vigorously
and diligently prosecuted by the Indemnifying Party to a final conclusion or will be settled
at the discretion of the Indemnifying Party (but only with the consent of the Indemnified
Party in the case of any settlement that provides for any relief other than the payment of
monetary damages or that provides for the payment of monetary damages as to which the
Indemnified Party will not be indemnified in full). The Indemnifying Party will have full
control of such defense and proceedings, including any compromise or settlement thereof;
provided, however, that the Indemnified Party may, at the sole cost and
expense of the Indemnified Party, at any time subsequent to the delivery of a Claim Notice
to the Indemnified Party and prior to the Indemnifying Party’s delivery of the notice
referred to in the first sentence of this Section 8.02(a)(i), file any motion,
answer or other pleadings or take any other action that the Indemnified Party reasonably
believes to be necessary or appropriate to protect its interests; and provided
further, that if requested by the Indemnifying Party, the Indemnified Party will, at
the sole cost and expense of the Indemnifying Party, provide reasonable cooperation to the
Indemnifying Party in contesting any Third Party Claim that the Indemnifying Party elects to
contest; and provided, further, that the Indemnified Party may choose
separate counsel at the sole cost and expense of the Indemnified Party in the event that a
conflict of interest arises between the Indemnified Party and the Indemnifying Party. The
Indemnified Party may participate in, but not control, any defense or settlement of any
Third Party Claim controlled by the Indemnifying Party pursuant to this Section
8.02(a)(i), and except as provided in the preceding sentence, the Indemnified Party will
bear its own costs and expenses with respect to such participation. Notwithstanding the
foregoing, the Indemnified Party may take over the control of the defense or settlement of a
Third Party Claim at any time if it irrevocably waives its right to indemnity under
Section 8.01 with respect to such Third Party Claim.

     (ii) If the Indemnifying Party fails to assume the defense of the Third Party Claim
within the Dispute Period or fails to prosecute reasonably, vigorously and diligently or
settle the Third Party Claim, then the Indemnified Party will have the right to defend, at
the sole cost and expense of the Indemnifying Party, the Third Party Claim by all
appropriate proceedings, which proceedings will be prosecuted by the Indemnified Party in a
reasonable manner and in good faith or will be settled at the discretion of the Indemnified
Party (with the consent of the Indemnifying Party, which consent will not be unreasonably
withheld). The Indemnified Party will have full control of such defense and proceedings,
including any compromise or settlement thereof; provided, however, that if
requested by the Indemnified Party, the Indemnifying Party will, at the sole cost and
expense of the Indemnifying Party, provide reasonable cooperation to the Indemnified Party
and its counsel in contesting any Third Party Claim which the Indemnified Party is
contesting. Notwithstanding the foregoing provisions of this Section 8.02(a)(ii),
if the Indemnifying Party has notified the Indemnified Party within the Dispute Period that
the Indemnifying Party disputes its liability hereunder to the Indemnified Party with
respect to such Third Party Claim and if such dispute is resolved in favor of the
Indemnifying Party in the manner provided in clause (iii) below, the

 

 

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Indemnifying Party will
not be required to bear the costs and expenses of the Indemnified Party’s defense pursuant
to this Section 8.02(a)(ii) or of the Indemnifying Party’s
participation therein at the Indemnified Party’s request, and the Indemnified Party
will reimburse the Indemnifying Party in full for all reasonable costs and expenses incurred
by the Indemnifying Party in connection with such litigation. The Indemnifying Party may
participate in, but not control, any defense or settlement controlled by the Indemnified
Party pursuant to this Section 8.02(a)(ii), and the Indemnifying Party will bear its
own costs and expenses with respect to such participation.

     (iii) If the Indemnifying Party notifies the Indemnified Party that it does not dispute
its liability to the Indemnified Party with respect to the Third Party Claim under
Section 8.01, or if the Indemnifying Party fails to deliver a notice to the
Indemnified Party within the Dispute Period, then the Loss in the amount specified in the
Claim Notice will be conclusively deemed a liability of the Indemnifying Party under
Section 8.01 and the Indemnifying Party shall pay the amount of such Loss to the
Indemnified Party on demand. If the Indemnifying Party has disputed its liability with
respect to such claim, the Indemnifying Party and the Indemnified Party will proceed in good
faith to negotiate a resolution of such dispute, and if not resolved through negotiations
within the Resolution Period, such dispute shall be resolved by arbitration in accordance
with Section 10.12 below.

          (b) In the event any Indemnified Party has a claim under Section 8.02 against any
Indemnifying Party that does not involve a Third Party Claim, the Indemnified Party shall deliver
an Indemnity Notice with reasonable promptness to the Indemnifying Party. The failure by any
Indemnified Party to give the Indemnity Notice shall not impair such party’s rights hereunder
except to the extent that an Indemnifying Party demonstrates that it has been irreparably
prejudiced thereby. If the Indemnifying Party notifies the Indemnified Party that it does not
dispute the claim described in such Indemnity Notice, or if the Indemnifying Party fails to deliver
a notice to the Indemnified Party within the Dispute Period, then the Loss in the amount specified
in the Indemnity Notice will be conclusively deemed a liability of the Indemnifying Party under
Section 8.02 and the Indemnifying Party (as applicable) shall pay the amount of such Loss
to the Indemnified Party on demand. If the Indemnifying Party has timely disputed its liability
with respect to such claim, the Indemnifying Party and the Indemnified Party will proceed in good
faith to negotiate a resolution of such dispute, and if not resolved through negotiations within
the Resolution Period, such dispute shall be resolved by arbitration in accordance with Section
10.12 below.

          8.03 Escrow Amount. Subject to Section 8.04, the Escrow Amount shall be
available (i) during the one year period following the Closing to reimburse the Purchaser
Indemnified Parties for any Losses for which they are entitled to be indemnified pursuant to
Section 8.01(a), and (ii) following the first anniversary of the Closing, to reimburse the
Purchaser Indemnified Parties for any Losses for which they are entitled to be indemnified pursuant
to Section 8.01(a) with respect to which a claim for indemnification was made by any
Purchaser Indemnified Party in accordance with this Article VIII and delivered in writing
to the Parent within such one year period, in which case a portion of the Escrow Amount sufficient
to satisfy such claim shall remain available until such time as such claim is resolved in
accordance with the terms of this Article VIII. On the first anniversary of the Closing
Date, the Escrow

 

 

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Agent shall pay to Seller the then-remaining Escrow Amount, including any interest
earned the Escrow Amount, but less any amounts required to satisfy pending claims in accordance
with the preceding sentence.

          8.04 Limitations.

          (a) No claim may be made by any Indemnified Party for indemnification pursuant to Section
8.01(a)(i) or Section 8.02(b)(i), as the case may be, unless and until the aggregate
amount of Losses for which the Purchaser Indemnified Parties or Seller Indemnified Parties, as the
case may be, seek to be indemnified pursuant to Section 8.01(a)(i) or Section
8.02(b)(i), as the case may be, exceeds $75,000, at which time such Indemnified Parties shall
be entitled to indemnification for all Losses in excess of $75,000 (the “Indemnity Threshold”);
provided, that, this subsection (a) shall not apply to Losses (i) for or arising out of fraud,
(ii) arising out of the breach of the representations and warranties contained in Sections 2.9,
2.12, 2.14, 2.15, the first sentence of 2.21 and 2.23; or (iii) arising under Sections
8.01(a)(v) or 8.01(a)(vi).

          (b) Seller’s, Shareholder’s and Parent’s indemnification obligations under Section
8.01(a) shall be limited to an amount equal to $3,000,000 (the “Cap”); provided, that, the Cap
shall not apply to Losses (i) for or arising out of fraud, (ii) arising out of the breach of the
representations and warranties contained in Sections 2.9, 2.12, 2.14, 2.15, and 2.23; or
(iii) arising under Section 8.01(a)(v). Purchaser’s indemnification obligations under
Section 8.01(b) shall be limited to an amount equal to the Cap.

          (c) Except in the event of fraud, the provisions of this Article VIII shall constitute
the exclusive remedy after the Closing for any and all Losses asserted against, resulting from,
imposed upon or incurred or suffered by the parties to this Agreement as a result of, or based upon
or arising from the transactions contemplated by this Agreement; provided, that, nothing contained
herein shall prevent any party from seeking equitable remedies (including specific performance or
injunctive relief) in connection therewith.

          (d) All claims by Indemnified Parties for Losses shall be made net of any insurance proceeds
actually recovered by the party claiming such indemnification; provided that, this subsection (d)
shall not be construed to require any party to obtain any insurance coverage or to use anything
other than commercially reasonable efforts to collect insurance proceeds under any existing
insurance coverage. Notwithstanding the foregoing, no Indemnified Party will be required to pursue
a recovery from an insurer in the event that the Indemnified Party determines in its reasonable
judgment that the pursuit of proceeds under such coverage would likely result in such Indemnified
Party being unable to obtain or maintain similar insurance coverage at commercially reasonable
rates as a result of its seeking such proceeds.

          (e) Payments by an Indemnifying Party pursuant to this Article VIII shall be (i)
limited to the amount of any Losses after deducting therefrom any income Tax benefit to the
Indemnified Party or any Affiliate thereof resulting from such Losses; and (ii) increased to take
account of any income Tax detriment incurred by the Indemnified Party arising from receipt or
accrual of indemnity payments. For purposes of this Section 8.04(e), an income Tax benefit
or income Tax detriment will be considered to be recognized by the Indemnified Party or any

 

 

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affiliate in the Tax period in which an actual income Tax benefit or income Tax detriment occurs.
The amount of the income Tax benefit or income Tax detriment shall be determined by
using the actual federal and state income Tax rates applicable to the Indemnified Party and
its affiliates, on a with and without basis after any deductions, credits, allowances or other
income Tax attributes reportable with respect to a payment hereunder and taking into account the
effect, if any and to the extent then determinable, of timing differences resulting from the
acceleration or deferral of items of income, gain, deduction or loss resulting from such payment
and the underlying Losses. The Indemnified Party shall provide the Indemnifying Party with a
detailed schedule that sets forth the amounts and anticipated Tax years in which any income Tax
benefits or detriments are likely to be recognized (based on the current experience and reasonable
judgment of the Indemnified Party) and, based on current federal and state income Tax rates, the
resulting estimated income Tax benefits or detriments. The present value of the estimated income
Tax benefits and detriments then shall be determined by discounting each Tax year’s estimated
income Tax benefit or detriment using a discount rate equal to the current prime lending rate as
published in the Wall Street Journal three (3) Business Days prior to the payment. The indemnity
payment shall be increased or decreased so that the payment equals the present value of the net
after-Tax benefit or detriment to the Indemnified Party. If there is a dispute regarding the
income Tax benefit or detriment (including its discount to present value), Purchaser and Seller
shall negotiate in good faith to resolve such dispute. If, after a period of thirty (30) days of
negotiations, such dispute remains unresolved, Purchaser and Seller will jointly engage an
Independent Accountant to resolve such dispute in accordance with this Agreement, and the decision
of the Independent Accountant shall be final and binding on the parties hereto and nonappealable.
All fees and expenses of the Independent Accountant incurred in connection with such resolution
shall be split equally between Purchaser and Seller.

          (f) All indemnification payments under this Article VIII will be considered
adjustments to the amount of the Purchase Price.

ARTICLE IX

DEFINITIONS

          9.01 Definitions. In addition to terms defined elsewhere in this Agreement, the
following defined terms have the meanings indicated below:

          “Actions or Proceedings” means any action, suit, proceeding, arbitration or Governmental
Authority investigation or audit.

          “Affiliate” means any Person that directly, or indirectly through one of more intermediaries,
controls or is controlled by or is under common control with the Person specified. For purposes of
this definition, control of a Person means the power, direct or indirect, to direct or cause the
direction of the management and policies of such Person whether by Contract or otherwise and, in
any event and without limitation of the previous sentence, any Person having record ownership of
ten percent (10%) or more of the voting securities of another Person shall be deemed to control
that Person.

 

 

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          “Assumed IT Contracts” means the license agreements related to the following products: (a)
Heat Service and Support Version 8.3, licensed from FrontRange Solutions; (b)
Aeroprise enterprise, licensed from Aeroprise; and (c) RSA Secure ID Tokens, licensed from RSA; and
(d) Great Plains Version 8.0, licensed from Microsoft Corporation.

          “Books and Records” of any Person means all files, documents, instruments, papers, books and
records relating to the business, operations, condition of (financial or other), results of
operations and assets and properties of such Person, including without limitation, budgets, pricing
guidelines, ledgers, journals, Contracts, Licenses, customer lists, computer files and programs,
retrieval programs and operating data.

          “Business Day” means a day other than Saturday, Sunday or any day on which banks located in
the State of Georgia, USA are authorized or obligated to close.

          “Claim Notice” means written notification pursuant to Section 8.02(a) of a Third Party
Claim as to which indemnity under Section 8.01 is sought by an Indemnified Party, enclosing
a copy of all papers served, if any, and specifying the nature of and basis for such Third Party
Claim and for the Indemnified Party’s claim against the Indemnifying Party under Section
8.01, together with the amount or, if not then reasonably ascertainable, the estimated amount,
determined in good faith, of such Third Party Claim.

          “Confidential Information” means all information of Purchaser which derives value, economic or
otherwise, from not being generally known to the public, but excluding any information that comes
into the public domain through no fault of Seller or any information that is required to be
disclosed by an Order or by any Law. Confidential Information of Purchaser shall be deemed to
include all Confidential Information of Seller related to the Business.

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

          “Contract” means any agreement, lease, license, evidence of Indebtedness, mortgage, indenture,
security agreement or other contract (whether written or oral).

          “Disclosure Schedule” means the record delivered to Purchaser by Seller, Shareholder and
Parent herewith and dated as of the date hereof, containing all lists, descriptions, exceptions and
other information and materials as are required to be included therein by Seller, Shareholder and
Parent pursuant to Article II this Agreement.

          “Dispute Period” means the period ending thirty (30) days following receipt by an Indemnifying
Party of either a Claim Notice or an Indemnity Notice.

          “Employee” means each current employee or full-time independent contractor of Seller engaged
in the conduct of the Business.

          “Escrow Agent” means Wells Fargo, National Association.

 

 

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          “Escrow Agreement” means that certain Escrow Agreement between Purchaser, Seller and the
Escrow Agent, in the form attached hereto as Exhibit B.

          “Excluded Employment Agreements” means: (a) the Employment Agreement between Seller and Mark
LeMay dated June 16, 2005; (b) the Employment Agreement between Seller and Rusty Rudzik dated June
16, 2005; (c) the Employment Agreement between Seller and Julio Vescovi dated June 16, 2005 and
amended on October 1, 2007; (c) the Employment Agreement between Seller and Greg Kosin dated June
16, 2005 and amended on October 1, 2007; (d) the Employment Agreement between Seller and Steve
Ferrante dated June 16, 2005; and (e) the Employment Agreement between Seller and Larry Martori
dated June 16, 2005 and amended on October 1, 2007.

          “Governmental Authority” means any US federal, state or local or foreign government,
governmental, regulatory or administrative authority, agency or commission or court, judicial or
arbitral body.

          “Indebtedness” of any Person means all obligations of such Person (i) for borrowed money, (ii)
evidenced by notes, bonds, debentures or similar instruments, (iii) for the deferred purchase price
of goods or services (other than trade payables or accruals incurred in the ordinary course of
business), (iv) under capital leases and (v) in the nature of guarantees of the obligations
described in clauses (i) through (iv) above of any other Person.

          “Indemnified Party” means any Person claiming indemnification under any provision of
Article VIII, including without limitation a Person asserting a claim pursuant to
Section 8.02.

          “Indemnifying Party” means any Person against whom a claim for indemnification is being
asserted under any provision of Article VIII, including without limitation a Person against
whom a claim is asserted pursuant to Section 8.02.

          “Indemnity Notice” means written notification pursuant to Section 8.02(b) of a claim
for indemnity under Article VIII by an Indemnified Party, specifying the nature of and
basis for such claim, together with the amount or, if not then reasonably ascertainable, the
estimated amount, determined in good faith, of such claim.

          “Intellectual Property” means all patents and patent rights, trademarks and trademark rights,
trade names and trade name rights, domain names, service marks and service mark rights, service
names and service name rights, brand names, inventions, processes, methods, designs, devices,
tools, specifications, techniques, algorithms, formulae, improvements, copyrights and copyright
rights, trade dress, business and product names, logos, slogans, trade secrets, industrial models,
computer programs, software (whether in source or object code) and related documentation, technical
information, manufacturing, engineering and technical drawings, know-how and all pending
applications for and registrations of patents, trademarks, service marks and copyrights.

 

 

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          “Inventory” means all inventories of raw materials, work-in-process, finished goods, products
under research and development, demonstration equipment, office and other supplies, parts,
packaging materials and other accessories related thereto which are held at, or are in transit from
or to, any Seller location, or located at customers’ premises on consignment, in
each case, which are used or held for use by Seller, including any of the foregoing purchased
subject to any conditional sales or title retention agreement in favor of any other Person,
together with all rights of Seller against suppliers of such inventories.

          “Knowledge” means those facts that are actually known to an individual or individuals of the
relevant party whose work involved the management or supervision of the applicable subject matter,
or those facts which, taking into account the scope and nature of the responsibilities of the
individual in question, could reasonably be expected to have been known by such individual. When
used with respect to the Seller, Shareholder or Parent, Knowledge means the Knowledge of each
director or officer of Seller, Shareholder or Parent. When used with respect to Purchaser,
Knowledge means the Knowledge of John Heyman and Mark Haidet.

          “Laws” means all laws, statutes, rules, regulations, ordinances and other pronouncements
having the effect of law of the United States, any foreign country or any domestic or foreign
state, county, city or other political subdivision or of any Governmental Authority.

          “Liabilities” means all Indebtedness, obligations and other liabilities of a Person (whether
absolute, accrued, contingent, fixed or otherwise, or whether due or to become due).

          “Licenses” means all licenses, permits, certificates of authority, authorizations, approvals,
registrations, franchises and similar consents granted or issued by any Governmental Authority.

          “Liens” means any mortgage, pledge, assessment, security interest, lease, lien, adverse claim,
levy, charge or other encumbrance of any kind.

          “Loss” means any and all damages, fines, fees, penalties, deficiencies, losses, costs and
expenses (including without limitation interest, court costs, reasonable fees of attorneys,
accountants and other experts or other expenses of litigation or other proceedings or of any claim,
default or assessment).

          “Most Recent Balance Sheet” means the most recent balance sheet included in the Financial
Statements.

          “Most Recent Balance Sheet Date” means the date of the Most Recent Balance Sheet.

          “Operative Agreements” means, collectively, the Escrow Agreement, the Services Agreement, the
Assignment Instruments and the Assumption Agreement.

 

 

EXECUTION COPY

          “Order” means any writ, judgment, decree, injunction or similar order of any Governmental
Authority (in each such case whether preliminary or final).

          “Permitted Lien” means (i) any Lien for Taxes not yet due or delinquent or being contested in
good faith by appropriate proceedings for which adequate reserves have been
established in accordance with GAAP, and (ii) any statutory Lien arising in the ordinary course of
business by operation of Law with respect to a Liability that is not yet due or delinquent.

          “Person” means any natural person, corporation, general partnership, limited partnership,
proprietorship, other business organization, trust, union, association or Governmental Authority.

          “Personally Identifiable Information” means any information that, alone or in combination with
other information, relates to a specific, identifiable individual Person. Personally Identifiable
Information includes individual names, social security numbers, telephone numbers, home address,
driver’s license number, account number, email address, and vehicle registration number. Any
information that can be associated with Personally Identifiable Information shall also be
Personally Identifiable Information. For example, an individual’s age alone is not Personally
Identifiable Information, but if such age were capable of being associated with one or more
specific identifiable individuals then such age would be deemed Personally Identifiable
Information.

          “Pre-Closing Tax Period” means Tax periods (or portions thereof) ending on or before the
Closing Date.

          “Purchaser Indemnified Parties” means Purchaser and its officers, directors, employees, agents
and Affiliates.

          “Resolution Period” means the period ending thirty (30) days following receipt by an
Indemnified Party of a written notice from an Indemnifying Party stating that it disputes all or
any portion of a claim set forth in a Claim Notice or an Indemnity Notice.

          “Restricted Territory” means the United States of America.

          “Retention Bonus Obligations” means the obligations with respect the “Retention Bonus,” as
defined in each of the Excluded Employment Agreements.

          “Seller Indemnified Parties” means Seller, Parent, Shareholder and their respective officers,
directors, employees, agents and Affiliates.

          “Services Agreement” means that certain Transitional Services Agreement between Purchaser and
Parent of even date.

          “Taxes” means any federal, state, local, or foreign income, gross receipts, license, payroll,
employment, excise, severance, stamp, occupation, premium, windfall profits, environmental, customs
duties, capital stock, franchise, profits, withholding, social security (or

 

 

EXECUTION COPY

similar), unemployment,
disability, real property, personal property, sales, use, transfer, registration, value added,
alternative or add-on minimum, estimated, or other tax of any kind whatsoever, including any
interest, penalty, or addition thereto, whether disputed or not.

ARTICLE X

MISCELLANEOUS

          10.01 Notices. All notices, requests and other communications hereunder must be in
writing and will be deemed to have been duly given only if delivered personally, by facsimile
transmission, by reputable overnight courier or mailed (first class postage prepaid) to the parties
at the following addresses or facsimile numbers:

If to Purchaser, to:

Radiant Systems, Inc.

3925 Brookside Parkway

Alpharetta, Georgia 30022

Attn: Mark Haidet

Facsimile: 770.360.7627

with a copy in like manner to:

DLA Piper US LLP

1201 West Peachtree Street, Suite 2800

Atlanta, Georgia 30309

Attn: Richard G. Greenstein, Esq.

Facsimile: 404.682.7816

If to Seller, Shareholder or Parent to:

Innuity, Inc.

8455 154th Avenue NE

Redmond, WA 98052

Attn: John Wall

Facsimile:

with a copy to:

Gray, Plant, Mooty, Mooty & Bennett, P.A.

500 IDS Center

80 South Eighth Street

Minneapolis, MN 55402

Attn: J.C. Anderson, Esq.

Facsimile: 612.632.4000

 

 

EXECUTION COPY

All such notices, requests and other communications will (a) if delivered personally to the address
as provided in this Section, be deemed given upon delivery, (b) if delivered by facsimile
transmission to the facsimile number as provided in this Section, be deemed given upon receipt, and
(c) if delivered by reputable overnight courier or mail in the manner described above to the
address as provided in this Section, be deemed given upon receipt (in each case regardless of
whether such notice, request or other communication is received by any other Person to whom a copy
of such notice, request or other communication is to be delivered pursuant to this Section). Any
party from time to time may change its address, facsimile number or other information for the
purpose of notices to that party by giving notice specifying such change to the other party hereto.

          10.02 Entire Agreement. This Agreement and the Operative Agreements supersede all
prior discussions and agreements between the parties with respect to the subject matter hereof and
thereof between the parties, and contain the sole and entire agreement between the parties hereto
with respect to the subject matter hereof and thereof.

          10.03 Expenses. Except as otherwise expressly provided in this Agreement, each party
(Seller, Shareholder and Parent collectively, and Purchaser, each being one party for purposes of
this Section 10.03) will pay its own costs and expenses (including without limitation all
broker’s or finder’s fees) incurred in connection with the negotiation, execution and closing of
this Agreement and the Operative Agreements and the transactions contemplated hereby and thereby.

          10.04 Bulk Sales Act. The parties hereby waive compliance with the bulk sales act or
comparable statutory provisions of each applicable jurisdiction. Seller shall indemnify Purchaser
and its officers, directors, employees, agents and Affiliates in respect of, and hold each of them
harmless from and against, any and all Losses suffered, occurred or sustained by any of them or to
which any of them becomes subject, resulting from, arising out of or relating to the failure of
Seller to comply with the terms of any bulk sales act or comparable statutory provisions of each
jurisdiction applicable to the transactions contemplated by this Agreement.

          10.05 Waiver. Any term or condition of this Agreement may be waived at any time by
the party that is entitled to the benefit thereof, but no such waiver shall be effective unless set
forth in a written instrument duly executed by or on behalf of the party waiving such term or
condition. No waiver by any party of any term or condition of this Agreement, in any one or more
instances, shall be deemed to be or construed as a waiver of the same or any other term or
condition of this Agreement on any future occasion. All remedies, either under this Agreement or
by Law or otherwise afforded, will be cumulative and not alternative.

          10.06 Amendment. This Agreement may be amended, supplemented or modified only by a
written instrument duly executed by or on behalf of each party hereto.

          10.07 No Third Party Beneficiary. The terms and provisions of this Agreement are
intended solely for the benefit of each party hereto and their respective successors or permitted
assigns, and it is not the intention of the parties to confer third-party beneficiary rights upon
any other Person other than any Person entitled to indemnity under Article VIII.

 

 

EXECUTION COPY

          10.08 No Assignment; Binding Effect. Neither this Agreement nor any right, interest
or obligation hereunder may be assigned by any party hereto without the prior written consent of
the other party hereto and any attempt to do so will be void. Subject to the preceding sentence,
this Agreement is binding upon, inures to the benefit of and is enforceable by the
parties hereto and their respective successors and assigns.

          10.09 Headings. The headings used in this Agreement have been inserted for
convenience of reference only and do not define or limit the provisions hereof.

          10.10 Invalid Provisions. If any provision of this Agreement is held to be illegal,
invalid or unenforceable under any present or future Law, and if the rights or obligations of any
party hereto under this Agreement will not be materially and adversely affected thereby, (a) such
provision will be fully severable, (b) this Agreement will be construed and enforced as if such
illegal, invalid or unenforceable provision had never comprised a part hereof, (c) the remaining
provisions of this Agreement will remain in full force and effect and will not be affected by the
illegal, invalid or unenforceable provision or by its severance herefrom and (d) in lieu of such
illegal, invalid or unenforceable provision, there will be added automatically as a part of this
Agreement a legal, valid and enforceable provision as similar in terms to such illegal, invalid or
unenforceable provision as may be possible.

          10.11 Counterparts. This Agreement may be executed in any number of counterparts,
each of which will be deemed an original, but all of which together will constitute one and the
same instrument. Signatures delivered as facsimiles shall be binding to the same extent as
original signatures.

          10.12 Governing Law. This Agreement shall be governed by and construed in accordance
with the Laws of the State of Georgia, USA applicable to a contract executed and performed in such
State, without giving effect to the conflicts of laws principles thereof.

          10.13 Specific Performance. Each of the parties agree that irreparable damage would
occur in the event that any of the provisions of this Agreement are not performed by such party in
accordance with their specific terms or are otherwise breached. It is accordingly agreed that any
of the parties to this Agreement shall be entitled to an injunction or injunctions or other
equitable relief to prevent breaches of this Agreement and to enforce specifically the terms and
provisions of this Agreement, this being in addition to any other remedy to which the counter-party
is entitled at law or in equity.

          10.14 Arbitration. Except as qualified in this Section 10.14, any dispute among the
parties arising under, out of, or in connection with or in relation to this Agreement or any of the
Operative Agreements will be submitted to binding arbitration under the authority of the Federal
Arbitration Act and will be arbitrated in accordance with the then current Commercial Arbitration
Rules of the American Arbitration Association (the “AAA”); provided, that the parties will be
entitled to conduct discovery as set forth in the Federal Rules of Civil Procedure and the
arbitrator will have the power to compel discovery. The arbitration will take place before a
single arbitrator in Fulton County, Georgia, or at such other place as is mutually agreed

 

 

EXECUTION COPY

to by the
parties. Arbitration will be commenced by a party giving written notice to the other party in
accordance with Section 10.01 of this Agreement stating the grounds of the dispute, the relief
sought and that the dispute is being arbitrated under this Section 10.14. If the parties cannot
mutually select an arbitrator and agree to administration of the arbitration within 30 days after
written notice is given, then the arbitration will be administered by the AAA in Fulton
County, Georgia, and the arbitrator will be selected by the staff of the corporate
headquarters of AAA located in New York, New York. No arbitrator selected by the AAA in accordance
with the preceding sentence may reside or conduct his or her principal business within the State of
Georgia. Any award rendered by the arbitrator shall be conclusive and binding upon the parties
hereto; provided, however, that any such award shall be accompanied by a written opinion of the
arbitrator giving the reasons for the award. This provision for arbitration shall be specifically
enforceable by the parties and the decision of the arbitrator in accordance herewith shall be final
and binding and there shall be no right of appeal therefrom. A judgment may be entered upon the
arbitration award by any state or federal court in the State of Georgia. Each party shall pay its
own expenses of arbitration and the expenses of the arbitrator shall be equally shared; provided,
however, that the arbitrator may assess, as part of its award, all or any part of the arbitration
expenses of the other party (including reasonable attorneys’ fees) and of the arbitrator against
the party raising such unreasonable claim, defense, or objection. Notwithstanding the foregoing,
nothing in this Section 10.14 shall be construed as limiting in any way the right of a party hereto
to seek injunctive relief with respect to any actual or threatened breach of this Agreement from a
court of competent jurisdiction.

          10.15 Waiver of Jury Trial. TO THE MAXIMUM EXTENT PERMITTED BY APPLICABLE LAW, EACH
SIGNATORY TO THIS AGREEMENT HEREBY IRREVOCABLY WAIVES ITS RESPECTIVE RIGHT TO A JURY TRIAL OF ANY
PERMITTED CLAIM OR CAUSE OF ACTION ARISING OUT OF THIS AGREEMENT, ANY OF THE TRANSACTIONS
CONTEMPLATED HEREBY, OR ANY DEALINGS BETWEEN ANY OF THE SIGNATORIES HERETO RELATING TO THE SUBJECT
MATTER OF THIS AGREEMENT OR ANY OF THE TRANSACTIONS CONTEMPLATED HEREBY. The scope of this waiver
is intended to be all encompassing of any and all disputes that may be filed in any court and that
relate the subject matter of this Agreement or any of the transactions contemplated hereby,
including contract claims, tort claims, and all other common law and statutory claims. This waiver
is irrevocable, meaning that it may not be modified either orally or in writing, and this waiver
shall apply to any subsequent amendments, supplements or other modifications to this Agreement, any
of the transactions contemplated hereby or to any other document or agreement relating to the
transactions contemplated hereby.

          10.16 Waiver of Punitive Damages. EXCEPT IN THE EVENT OF FRAUD, EACH PARTY, TO THE
FULLEST EXTENT PERMITTED BY LAW, IRREVOCABLY WAIVES ANY RIGHTS THAT IT MAY HAVE TO PUNITIVE DAMAGES
BASED UPON, OR ARISING OUT OF, THIS AGREEMENT OR ANY COURSE OF CONDUCT, COURSE OF DEALING,
STATEMENTS OR ACTIONS OF ANY OF THEM RELATING THERETO.

[REMAINDER OF THIS PAGE BLANK. SIGNATURE PAGE FOLLOWS.]

 

 

     IN WITNESS WHEREOF, this Agreement has been duly executed and delivered by or on behalf of
each party as of the date first above written.

	 	 	 	 	 	 	 	 	 
	 	 	RADIANT SYSTEMS, INC.	 	 
	 
	 	 	 	 	 	 	 	 
	 

	 	By:	 	 	 	 	 	 
	 	 	 	 	 	 	 
	 

	 	 	 	Name:	 	 	 	 
	 

	 	 	 	 	 	 	 	 
	 

	 	 	 	Title:	 	 	 	 
	 

	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 
	 	 	JADEON, INC.	 	 
	 
	 	 	 	 	 	 	 	 
	 

	 	By:	 	 	 	 	 	 
	 	 	 	 	 	 	 
	 

	 	 	 	Name:	 	 	 	 
	 

	 	 	 	 	 	 	 	 
	 

	 	 	 	Title:	 	 	 	 
	 

	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 
	 	 	VISTA.COM, INC.	 	 
	 
	 	 	 	 	 	 	 	 
	 

	 	By:	 	 	 	 	 	 
	 	 	 	 	 	 	 
	 

	 	 	 	Name:	 	 	 	 
	 

	 	 	 	 	 	 	 	 
	 

	 	 	 	Title:	 	 	 	 
	 

	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 
	 	 	INNUITY, INC.	 	 
	 
	 	 	 	 	 	 	 	 
	 

	 	By:	 	 	 	 	 	 
	 	 	 	 	 	 	 
	 

	 	 	 	Name:	 	 	 	 
	 

	 	 	 	 	 	 	 	 
	 

	 	 	 	Title:exv10w1

 

EXHIBIT 10.1

[Series     ]

LIBERTY GLOBAL, INC.

2005 INCENTIVE PLAN

RESTRICTED SHARE UNITS AGREEMENT

     THIS
RESTRICTED SHARE UNITS AGREEMENT (“Agreement”) is made as of                     , 20    (the
“Grant Date”), by and between LIBERTY GLOBAL, INC., a Delaware corporation (the “Company”), and the
individual whose name, address, and social security/payroll number appear on the signature page
hereto (the “Grantee”).

     The Company has adopted the Liberty Global, Inc. 2005 Incentive Plan, as amended and restated
(the “Plan”), which by this reference is made a part hereof, for the benefit of eligible employees
of, and independent contractors providing services to, the Company and its Subsidiaries.
Capitalized terms used and not otherwise defined herein will have the meaning given thereto in the
Plan.

     Pursuant to the Plan, the Compensation Committee (the “Committee”) appointed by the Board
pursuant to Section 3.1 of the Plan to administer the Plan has determined that it would be in the
best interest of the Company and its stockholders to award restricted share units to Grantee,
subject to the conditions and restrictions set forth herein and in the Plan, in order to provide
the Grantee additional remuneration for services rendered, to encourage the Grantee to continue to
provide services to the Company or its Subsidiaries and to increase the Grantee’s personal interest
in the continued success and progress of the Company.

     The Company and the Grantee therefore agree as follows:

     1. Definitions. The following terms, when used in this Agreement, have the following
meanings:

          “Business Day” means any day other than Saturday, Sunday or a day on which banking
institutions in Denver, Colorado, are required or authorized to be closed.

          “Cause” has the meaning specified for “cause” in Section 11.2(b) of the Plan.

          “Code” means the Internal Revenue Code of 1986, as it may be amended from time to time.

          “Committee” has the meaning specified in the recitals to this Agreement.

          “Company” has the meaning specified in the preamble to this Agreement.

          “Corresponding Day” means with respect to each month, the day of that month that is the same
day of the month as the Grant Date; provided that, for any month for which there is not a day
corresponding to the Grant Date, then the Corresponding Day shall be the last day of

1

 

such month. By way of example, if the Grant Date was the 31st of December, the
Corresponding Day in June would be the 30th.

          “Grant Date” has the meaning specified in the preamble to this Agreement.

          “Grantee” has the meaning specified in the preamble to this Agreement.

          “LBTY    ” means the Series      common stock, par value $.01 per share, of the Company.

          “Plan” has the meaning specified in the recitals to this Agreement.

          “Required Withholding Amount” has the meaning specified in Section 13 of this Agreement.

          “Restricted Share Units” has the meaning specified in Section 2 of this Agreement. Restricted
Share Units represent an Award of Restricted Shares that provides for the shares of Common Stock
subject to the Award to be issued at or following the end of the Restriction Period within the
meaning of Article VIII of the Plan.

          “RSU Dividend Equivalents” means, to the extent specified by the Committee only, an amount
equal to all dividends and other distributions (or the economic equivalent thereof) which are
payable to stockholders of record during the Restriction Period on a like number and kind of shares
of Common Stock as the shares represented by the Restricted Share Units.

          “Section 409A Payment Date” means, with respect to any Vesting Date, the March 15 of the
calendar year following the calendar year in which such Vesting Date occurred.

          “Termination of Service” means the termination for any reason of Grantee’s provision of
services to the Company and its Subsidiaries, as an officer, employee or independent contractor.

          “Vesting Date” means each date on which any Restricted Share Units cease to be subject to a
risk of forfeiture, as determined in accordance with this Agreement and the Plan.

     2. Grant of Restricted Share Units. Subject to the terms and conditions herein, pursuant to
the Plan, the Company grants to the Grantee effective as of the Grant Date an Award of the number
of restricted share units set forth on the signature page hereto (the “Restricted Share Units”),
each representing the right to receive one share of LBTY
    , subject to the conditions and
restrictions set forth below and in the Plan.

     3. Settlement of Restricted Share Units. Settlement of Restricted Share Units that vest in
accordance with Section 5 or 6 of this Agreement or Section 11.1(b) of the Plan shall be made as
soon as administratively practicable after the applicable Vesting Date, but in no event later than
the Section 409A Payment Date applicable to such Vesting Date. Settlement of vested

2

 

Restricted Share Units shall be made in payment of shares of LBTY    , together with any related
RSU Dividend Equivalents, in accordance with Section 7.

     4. Stockholder Rights; RSU Dividend Equivalents. The Grantee shall have no rights of a
stockholder with respect to any shares of LBTY     represented by any Restricted Share Units unless
and until such time as shares of LBTY     represented by vested Restricted Share Units have been
delivered to the Grantee in accordance with Section 7. Grantee will have no right to receive, or
otherwise with respect to, any RSU Dividend Equivalents until such time, if ever, as the Restricted
Share Units with respect to which such RSU Dividend Equivalents relate shall have become vested
and, if vesting does not occur, the related RSU Dividend Equivalents will be forfeited. RSU
Dividend Equivalents shall not bear interest or be segregated in a separate account.
Notwithstanding the foregoing, the Committee may, in its sole discretion, accelerate the vesting of
any portion of the RSU Dividend Equivalents (the “Vested RSU Dividend Equivalents”). The
settlement of any Vested RSU Dividend Equivalents shall be made as soon as administratively
practicable after the accelerated vesting date, but in no event later than March 15 of the
following calendar year.

     5. Vesting. Unless the Committee otherwise determines in its sole discretion, subject to
earlier vesting in accordance with Section 6 of this Agreement or Section 11.1(b) of the Plan and
subject to the last sentence of this Section 5, the Restricted Share Units shall become vested in
accordance with the following schedule (each date specified below being a Vesting Date):

	 	(i)	 	On the Corresponding Day in the sixth month
following the Grant Date, 12.5% of the Restricted Share Units shall
become vested; and
	 
	 	(ii)	 	On the Corresponding Day in the ninth month
following the Grant Date and on the Corresponding Day on each third
month thereafter, an additional 6.25% of the Restricted Share Units
shall become vested, until the Restricted Share Units are vested in
full on the Corresponding Day in the forty-eighth (48) month following
the Grant Date.

     On each Vesting Date, and the satisfaction of any other applicable restrictions, terms and
conditions, any RSU Dividend Equivalents with respect to the Restricted Share Units that have not
theretofore become Vested RSU Dividend Equivalents (“Unpaid RSU Dividend Equivalents”) will become
vested to the extent that the Restricted Share Units related thereto shall have become vested in
accordance with this Agreement. Notwithstanding the foregoing, Grantee will not vest, pursuant to
this Section 5, in Restricted Share Units as to which Grantee would otherwise vest as of a given
date if Termination of Service or a breach of any applicable restrictions, terms or conditions with
respect to such Restricted Share Units has occurred at any time after the Grant Date and prior to
such Vesting Date (the vesting or forfeiture of such Restricted Share Units to be governed instead
by Section 6).

3

 

     6. Early Vesting or Forfeiture.

          (a) Unless otherwise determined by the Committee in its sole discretion:

	 	(i)	 	If Termination of Service occurs by reason of
Grantee’s death or Disability, the Restricted Share Units, to the
extent not theretofore vested, and any related Unpaid RSU Dividend
Equivalents, will immediately become fully vested;
	 
	 	(ii)	 	If Termination of Service is by the Company or
a Subsidiary without Cause (as determined in the sole discretion of the
Committee) more than six months after the Grant Date and prior to
vesting in full of the Restricted Share Units, then an additional
percentage of the Restricted Share Units, together with any related
Unpaid RSU Dividend Equivalents, will become vested on the date of
Termination of Service equal to the product of (x) one-third (1/3) of
the additional percentage of Restricted Share Units that would have
become vested on the next following Vesting Date in accordance with the
schedule in Section 5, times (y) the number of full months of
employment completed since the most recent Vesting Date preceding the
Termination of Service, and the balance of the Restricted Share Units
to the extent not theretofore vested, together with any related Unpaid
RSU Dividend Equivalents, will be forfeited immediately.
	 
	 	(iii)	 	If Termination of Service occurs for any
reason other than as specified in Section 6(a)(i) or 6(a)(ii) above,
then the Restricted Share Units, to the extent not theretofore vested,
together with any related Unpaid RSU Dividend Equivalents, will be
forfeited immediately.
	 
	 	(iv)	 	If Grantee breaches any restrictions, terms or
conditions provided in or established by the Committee pursuant to the
Plan or this Agreement with respect to the Restricted Share Units prior
to the vesting thereof (including any attempted or completed transfer
of any such unvested Restricted Share Units contrary to the terms of
the Plan or this Agreement), the unvested Restricted Share Units,
together with any related Unpaid RSU Dividend Equivalents, will be
forfeited immediately.

          (b) Upon forfeiture of any unvested Restricted Share Units, and any related Unpaid RSU
Dividend Equivalents, such Restricted Share Units and any related Unpaid RSU Dividend Equivalents
will be immediately cancelled, and Grantee will cease to have any rights with respect thereto.

          (c) Unless the Committee otherwise determines, neither a change of the Grantee’s employment
from the Company to a Subsidiary or from a Subsidiary to the Company or another Subsidiary, nor a
change in Grantee’s status from an independent contractor to an employee, will be a Termination of
Service for purposes of this Agreement if such change of

4

 

employment or status is made at the request or with the express consent of the Company.
Unless the Committee otherwise determines, however, any such change of employment or status that is
not made at the request or with the express consent of the Company and any change in Grantee’s
status from an employee to an independent contractor will be a Termination of Service within the
meaning of this Agreement.

     7. Delivery by Company. As soon as practicable after the vesting of Restricted Share Units,
and any related Unpaid RSU Dividend Equivalents, pursuant to Section 5 or 6 hereof or Section
11.1(b) of the Plan, and subject to the withholding referred to in Section 13 of this Agreement,
the Company will deliver or cause to be delivered to or at the direction of Grantee (i)(a) a
certificate or certificates issued in Grantee’s names for the shares of LBTY     represented by such
vested Restricted Share Units, (b) a statement of holdings reflecting that the shares of LBTY    
represented by such vested Restricted Share Units are held for the benefit of Grantee in
uncertificated form by a third party service provider designated by the Company, or (c) a
confirmation of deposit of the shares of LBTY     represented by such vested Restricted Share Units,
in book-entry form, into the broker’s account designated by Grantee, (ii) any securities
constituting related vested Unpaid RSU Dividend Equivalents by any applicable method specified in
clause (i) above, and (iii) any cash payment constituting related vested Unpaid RSU Dividend
Equivalents. Any delivery of securities will be deemed effected for all purposes when (1) a
certificate representing or statement of holdings reflecting such securities and, in the case of
any Unpaid RSU Dividend Equivalents, any other documents necessary to reflect ownership thereof by
Grantee has been delivered personally to the Grantee or, if delivery is by mail, when the Company
or its stock transfer agent has deposited the certificate or statement of holdings and/or such
other documents in the United States mail, addressed to the Grantee, or (2) confirmation of deposit
into the designated broker’s account of such securities, in written or electronic format, is first
made available to Grantee. Any cash payment will be deemed effected when a check from the Company,
payable to or at the direction of the Grantee and in the amount equal to the amount of the cash
payment, has been delivered personally to or at the direction of the Grantee or deposited in the
United States mail, addressed to the Grantee or his or her nominee.

     8. Nontransferability of Restricted Share Units Before Vesting.

          (a) Before vesting and during Grantee’s lifetime, the Restricted Share Units and any related
Unpaid RSU Dividend Equivalents may not be sold, assigned, transferred by gift or otherwise,
pledged, exchanged, encumbered or disposed of (voluntarily or involuntarily), other than an
assignment pursuant to a Domestic Relations Order. In the event of an assignment pursuant to a
Domestic Relations Order, the unvested Restricted Share Units and any related Unpaid RSU Dividend
Equivalents so assigned shall be subject to all the restrictions, terms and provisions of this
Agreement and the Plan, and the assignee shall be bound by all applicable provisions of this
Agreement and the Plan in the same manner as Grantee.

          (b) The Grantee may designate a beneficiary or beneficiaries to whom the Restricted Share
Units, to the extent then vesting, and any related Unpaid RSU Dividend Equivalents will pass upon
the Grantee’s death and may change such designation from time to time by filing a written
designation of beneficiary or beneficiaries with the Committee on such

5

 

form as may be prescribed by the Committee, provided that no such designation will be
effective unless so filed prior to the death of Grantee. If no such designation is made or if the
designated beneficiary does not survive Grantee’s death, the Restricted Share Units, to the extent
then vesting, and any related Unpaid RSU Dividend Equivalents will pass by will or the laws of
descent and distribution. Following Grantee’s death, the person to whom such vested Restricted
Share Units and any related Unpaid RSU Dividend Equivalents pass according to the foregoing will be
deemed the Grantee for purposes of any applicable provisions of this Agreement.

     9. Adjustments. The Restricted Share Units and any related Unpaid RSU Dividend Equivalents
will be subject to adjustment pursuant to Section 4.2 of the Plan in such manner as the Committee
may deem equitable and appropriate in connection with the occurrence following the Grant Date of
any of the events described in Section 4.2 of the Plan.

     10. Company’s Rights. The existence of this Agreement will not affect in any way the right or
power of the Company or its stockholders to accomplish any corporate act, including, without
limitation, the acts referred to in Section 11.16 of the Plan.

     11. Limitation of Rights. Nothing in this Agreement or the Plan will be construed to give
Grantee any right to be granted any future Award other than in the sole discretion of the Committee
or give Grantee or any other person any interest in any fund or in any specified asset or assets of
the Company or any of its Subsidiaries. Neither Grantee nor any person claiming through Grantee
will have any right or interest in shares of LBTY     represented by any Restricted Share Units or
any related Unpaid RSU Dividend Equivalents unless and until there shall have been full compliance
with all the terms, conditions and provisions of this Agreement and the Plan which affect Grantee
or such other person.

     12. Restrictions Imposed by Law. Without limiting the generality of Section 11.8 of the Plan,
the Company shall not be obligated to deliver any shares of LBTY     represented by vested Restricted
Share Units or securities constituting any Unpaid RSU Dividend Equivalents if counsel to the
Company determines that the issuance or delivery thereof would violate any applicable law or any
rule or regulation of any governmental authority or any rule or regulation of, or agreement of the
Company with, any securities exchange upon which shares of LBTY     or such other securities are
listed. The Company will in no event be obligated to take any affirmative action in order to cause
the delivery of shares of LBTY     represented by vested Restricted Share Units or securities
constituting any Unpaid RSU Dividend Equivalents to comply with any such law, rule, regulation, or
agreement. Any certificates representing any such securities issued or delivered under this
Agreement may bear such legend or legends as the Company deems appropriate in order to assure
compliance with applicable securities laws.

     13. Withholding. To the extent that the Company is subject to withholding tax requirements
under any national, state, local or other governmental law with respect to the award of the
Restricted Share Units to Grantee or the vesting thereof, or the designation of any RSU Dividend
Equivalents as payable or distributable or the payment or distribution thereof, the Grantee must
make arrangement satisfactory to the Company to make payment to the Company of the amount required
to be withheld under such tax laws, as determined by the Company (collectively, the “Required
Withholding Amount”). To the extent such withholding is required because the Grantee vests in some
or all of the Restricted Share Units and any related RSU

6

 

Dividend Equivalents, the Company shall withhold (i) from the shares of LBTY     represented by
vested Restricted Share Units and otherwise deliverable to the Grantee a number of shares of LBTY    
and/or (ii) from any related RSU Dividend Equivalents otherwise deliverable to the Grantee an
amount of such RSU Dividend Equivalents, which collectively have a value (or, in the case of
securities withheld, a Fair Market Value) equal to the Required Withholding Amount, unless Grantee
remits the Required Withholding Amount to the Company in cash in such form and by such time as the
Company may require or other provisions for withholding such amount satisfactory to the Company
have been made. Notwithstanding any other provisions of this Agreement, the delivery of any shares
of LBTY     represented by vested Restricted Share Units and any related RSU Dividend Equivalents may
be postponed until any required withholding taxes have been paid to the Company.

     14. Notice. Unless the Company notifies the Grantee in writing of a different procedure, any
notice or other communication to the Company with respect to this Agreement will be in writing and
will be delivered personally or sent by United States first class mail, postage prepaid, sent by
overnight courier, freight prepaid or sent by facsimile and addressed as follows:

Liberty Global, Inc.

12300 Liberty Boulevard

Englewood, CO 80112

Attn: General Counsel

Fax: 303-220-6691

     Any notice or other communication to the Grantee with respect to this Agreement will be in
writing and will be delivered personally, or will be sent by United States first class mail,
postage prepaid, to the Grantee’s address as listed in the records of the Company on the Grant
Date, unless the Company has received written notification from the Grantee of a change of address.

     15. Amendment. Notwithstanding any other provision hereof, this Agreement may be supplemented
or amended from time to time as approved by the Committee. Without limiting the generality of the
foregoing, without the consent of the Grantee,

          (a) this Agreement may be amended or supplemented from time to time as approved by the
Committee (i) to cure any ambiguity or to correct or supplement any provision herein which may be
defective or inconsistent with any other provision herein, or (ii) to add to the covenants and
agreements of the Company for the benefit of the Grantee or surrender any right or power reserved
to or conferred upon the Company in this Agreement, subject to any required approval of the
Company’s stockholders and, provided, in each case, that such changes or corrections will not
adversely affect the rights of the Grantee with respect to the Award evidenced hereby, or (iii) to
reform the Award made hereunder as contemplated by Section 11.18 of the Plan or to exempt the Award
made hereunder from coverage under Section 409A, or (iv) to make such other changes as the Company,
upon advice of counsel, determines are necessary or advisable because of the adoption or
promulgation of, or change in or of the interpretation of, any law or governmental rule or
regulation, including any applicable federal or state securities laws; and

7

 

          (b) subject to any required action by the Board or the stockholders of the Company, the
Restricted Share Units granted under this Agreement may be canceled by the Company and a new Award
made in substitution therefor, provided that the Award so substituted will satisfy all of the
requirements of the Plan as of the date such new Award is made and no such action will adversely
affect any Restricted Share Units that are then vested.

     16. Grantee Employment.

          (a) Nothing contained in this Agreement, and no action of the Company or the Committee with
respect hereto, will confer or be construed to confer on the Grantee any right to continue in the
employ or service of the Company or any of its Subsidiaries or interfere in any way with any right
of the Company or any Subsidiary, subject to the terms of any separate employment agreement to the
contrary, to terminate the Grantee’s employment or service at any time, with or without cause.

          (b) The Award hereunder is special incentive compensation that will not be taken into account,
in any manner, as salary, earnings, compensation, bonus or benefits, in determining the amount of
any payment under any pension, retirement, profit sharing, 401(k), life insurance, salary
continuation, severance or other employee benefit plan, program or policy of the Company or any of
its Subsidiaries or any employment agreement or arrangement with the Grantee.

          (c) It is a condition of the Grantee’s Award that, in the event of Termination of Service for
whatever reason, whether lawful or not, including in circumstances which could give rise to a claim
for wrongful and/or unfair dismissal (whether or not it is known at the time of Termination of
Service that such a claim may ensue), the Grantee will not by virtue of such Termination of
Service, subject to Section 6 of this Agreement, become entitled to any damages or severance or any
additional amount of damages or severance in respect of any rights or expectations of whatsoever
nature the Grantee may have hereunder or under the Plan. Notwithstanding any other provision of
the Plan or this Agreement, the Award hereunder will not form part of the Grantee’s entitlement to
remuneration or benefits pursuant to the Grantee’s employment agreement or arrangement, if any.
The rights and obligations of the Grantee under the terms of his or her employment agreement, if
any, will not be enhanced hereby.

          (d) In the event of any inconsistency between the terms hereof or of the Plan and any
employment, severance or other agreement with the Grantee, the terms hereof and of the Plan shall
control.

     17. Nonalienation of Benefits. Except as provided in Section 8 of this Agreement, (i) no
right or benefit under this Agreement will be subject to anticipation, alienation, sale,
assignment, hypothecation, pledge, exchange, transfer, encumbrance or charge, and any attempt to
anticipate, alienate, sell, assign, hypothecate, pledge, exchange, transfer, encumber or charge the
same will be void, and (ii) no right or benefit hereunder will in any manner be liable for or
subject to the debts, contracts, liabilities or torts of the Grantee or other person entitled to
such benefits.

8

 

     18. Data Privacy.

          (a) The Grantee’s acceptance hereof shall evidence the Grantee’s explicit and unambiguous
consent to the collection, use and transfer, in electronic or other form, of the Grantee’s personal
data by and among, as applicable, the Grantee’s employer (the “Employer”) and the Company and its
subsidiaries and affiliates for the exclusive purpose of implementing, administering and managing
the Grantee’s participation in the Plan. The Grantee understands that the Company and the Employer
may hold certain personal information about the Grantee, including, but not limited to, the
Grantee’s name, home address and telephone number, date of birth, social insurance number or other
identification number, salary, bonus and employee benefits, nationality, job title and description,
any shares of stock or directorships or other positions held in the Company, its subsidiaries and
affiliates, details of all options, stock appreciation rights, restricted shares, restricted share
units or any other entitlement to shares of stock or other Awards granted, canceled, exercised,
vested, unvested or outstanding in the Grantee’s favor, annual performance objectives, performance
reviews and performance ratings, for the purpose of implementing, administering and managing Awards
under the Plan (“Data”).

          (b) The Grantee understands that Data may be transferred to any third parties assisting in the
implementation, administration and management of the Plan, that these recipients may be located in
the Grantee’s country or elsewhere, and that the recipients’ country (e.g. the United States) may
have different data privacy laws and protections than the Grantee’s country. The Grantee
understands that the Grantee may request a list with the names and addresses of any potential
recipients of the Data by contacting the Grantee’s local human resources representative. The
Grantee authorizes the recipients to receive, possess, use, retain and transfer the Data, in
electronic or other form, for the sole purpose of implementing, administering and managing the
Grantee’s participation in the Plan, including any requisite transfer of such Data as may be
required to a broker or other third party with whom the Grantee may elect to deposit any shares of
stock acquired with respect to an Award.

          (c) The Grantee understands that Data will be held only as long as is necessary to implement,
administer and manage the Grantee’s participation in the Plan. The Grantee understands that the
Grantee may at any time view Data, request additional information about the storage and processing
of Data, require any necessary amendments to Data or refuse or withdraw the consents herein, in any
case without cost, by contacting in writing the Grantee’s local human resources representative.
The Grantee understands, however, that refusing or withdrawing the Grantee’s consent may affect the
Grantee’s ability to participate in the Plan. For more information on the consequences of a
refusal to consent or withdrawal of consent, the Grantee may contact the Grantee’s local human
resources representative.

     19. Governing Law. This Agreement will be governed by, and construed in accordance with, the
internal laws of the State of Colorado. Each party irrevocably submits to the general jurisdiction
of the state and federal courts located in the State of Colorado in any action to interpret or
enforce this Agreement and irrevocably waives any objection to jurisdiction that such party may
have based on inconvenience of forum.

     20. Construction. References in this Agreement to “this Agreement” and the words “herein,”
“hereof,” “hereunder” and similar terms include all Exhibits and Schedules appended hereto,
including the Plan. This Agreement is entered into, and the Award evidenced hereby is

9

 

granted, pursuant to the Plan and shall be governed by and construed in accordance with the
Plan and the administrative interpretations adopted by the Committee thereunder. The word “include”
and all variations thereof are used in an illustrative sense and not in a limiting sense. All
decisions of the Committee upon questions regarding this Agreement will be conclusive. Unless
otherwise expressly stated herein, in the event of any inconsistency between the terms of the Plan
and this Agreement, the terms of the Plan will control. The headings of the sections of this
Agreement have been included for convenience of reference only, are not to be considered a part
hereof and will in no way modify or restrict any of the terms or provisions hereof.

     21. Duplicate Originals. The Company and the Grantee may sign any number of copies of this
Agreement. Each signed copy will be an original, but all of them together represent the same
agreement.

     22. Rules by Committee. The rights of the Grantee and the obligations of the Company
hereunder will be subject to such reasonable rules and regulations as the Committee may adopt from
time to time.

     23. Entire Agreement. This Agreement is in satisfaction of and in lieu of all prior
discussions and agreements, oral or written, between the Company and the Grantee regarding the
subject matter hereof. The Grantee and the Company hereby declare and represent that no promise or
agreement not herein expressed has been made and that this Agreement contains the entire agreement
between the parties hereto with respect to the Award and replaces and makes null and void any prior
agreements between the Grantee and the Company regarding the Award. This Agreement will be binding
upon and inure to the benefit of the parties and their respective heirs, successors and assigns.

     24. Grantee Acceptance. The Grantee will signify acceptance of the terms and conditions of
this Agreement by signing in the space provided at the end hereof and returning a signed copy to
the Company. If the Grantee does not execute this Agreement within 60 days of the Grant Date, the
grant of Restricted Share Units shall be null and void.

10

 

Signature Page to Restricted Share Units Agreement

dated as of                           , 20     , between Liberty Global, Inc. and Grantee

	 	 	 	 	 	 	 
	 	 	LIBERTY GLOBAL, INC.	 	 
	 
	 	 	 	 	 	 
	 

	 	By:
	 	 
 

	 	 
	 	 	Name: 

Title: 	 	 

	 	 	 	 	 	 	 
	 	 	ACCEPTED:	 	 
	 
	 	 	 	 	 	 
	 	 	 	 	 
	 

	 	Grantee Name:	 	 	 	 
	 

	 	 	 	 	 	 
	 

	 	Address:	 	 	 	 
	 

	 	 	 	 	 	 
	 
	 	 	 	 	 	 
	 

	 	 	 	 	 	 
	 
	 	 	 	 	 	 
	 

	 	Optionee ID:	 	 	 	 
	 

	 	 	 	 	 	 

Grant No.                                         

Number of
Restricted Share Units (LBTY   ) Awarded:                                         

11

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