ASSET PURCHASE AGREEMENT
BY AND AMONG
CAIS ACQUISITION II, LLC
VMC SATELLITE, INC.
April 26, 2005
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ASSET PURCHASE AGREEMENT
THIS ASSET PURCHASE AGREEMENT (this “Agreement”) is entered into as of this 26th day of April, 2005 by and among CAIS Acquisition II, LLC, a Delaware limited liability company (“Buyer”), InPhonic, Inc., a Delaware corporation, and parent company of Buyer (“InPhonic”), VMC Satellite, Inc., a Virginia corporation (“VMC”) and Rick Rahim, the sole stockholder of Seller (the “Selling Stockholder” and collectively, with VMC, referred to herein as the “Seller”). For purposes of this Agreement, Seller and Buyer are sometimes each referred to individually as a “Party” or collectively as the “Parties.” InPhonic is executing this Agreement for the limited purpose of making certain representations and warranties set forth in Article IV and for specified obligations set forth in Article VII.
WHEREAS, VMC engages in the business of acquiring customers for Digital Broadcast Satellite services, including the selling and activating of service equipment, and installation, primarily through the Internet (together with all other business which is being conducted by VMC and its wholly owned subsidiary, SERS, as of the date hereof, the “Business”); and
WHEREAS, subject to the terms and conditions set forth herein, Seller desires to sell, convey, transfer, assign and deliver to Buyer, and Buyer desires to purchase, acquire and accept from Seller, free and clear of all liens, charges and encumbrances of any kind, all of Seller’s right, title, and interest in and to all of the Acquired Assets (collectively, the “Acquisition”).
NOW, THEREFORE, in consideration of the foregoing and the representations, warranties, agreements and covenants herein contained, and for other good and other valuable consideration, the receipt and legal sufficiency of which are hereby acknowledged, the Parties, the Selling Stockholder and InPhonic (as to certain sections of Article IV and for specified obligations under Article VII only) intending to be legally bound, hereby agree as follows.
Capitalized terms undefined in the text of this Agreement shall have the following meanings:
“Acceleration Payment” has the meaning set forth in Section 5.17.
“Accounting Referee” has the meaning set forth in Section 2.6(e).
“Accounts Receivable” means (i) all trade accounts receivable and other rights to payment from customers of VMC and the full benefit of all security for such accounts or rights to payment, including all trade accounts receivable representing amounts receivable in respect of goods shipped or products sold or services rendered to customers of VMC, and (ii) any claim, privilege, cause of action, remedy or other right related to any of the foregoing (excluding discounts, rebates, uncollectable receivables or other reductions in Accounts Receivable).
“Acquired Assets” has the meaning set forth in Section 2.1.
“Acquisition” has the meaning set forth in the Recitals.
“Affiliate” means, with respect to any Person, any other Person that, directly or indirectly, through one or more intermediaries, Controls, is Controlled by or is under common Control with, such Person. For purposes of this definition, “Control” (including, with correlative meanings, the terms “Controlled by” and “under common Control with”) means the possession, directly or indirectly, of the power to direct or cause the direction of the management or policies of a Person, whether through the ownership of stock, as trustee or executor, by Contract or credit arrangement or otherwise.
“Agreement” has the meaning set forth in the first paragraph.
“Ancillary Agreements” means all assignment agreements, and other documents and instruments, pursuant to which Seller’s right, title or interest in any of the Acquired Assets are transferred to Buyer.
“Assigned Contracts” has the meaning set forth in Section 2.1(c).
“Audit Fees” has the meaning set forth in Section 2.5(a)(iv).
“Business” has the meaning set forth in the Recitals.
“Business Affiliate(s)” has the meaning set forth in Section 3.21.
“Buyer” has the meaning as set forth in the first paragraph of this Agreement.
“Buyer Charter” means the Certificate of Formation of Buyer.
“Buyer Disclosure Schedules” has the meaning set forth in the first paragraph of Article IV.
“Buyer Indemnified Persons” has the meaning set forth in Section 7.1(a).
“Bylaws” means a true and complete copy of Seller’s bylaws, as amended and in effect on the date hereof.
“Cap” has the meaning set forth in Section 7.1(e).
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“Charter” means a true and complete copy of Seller’s articles of incorporation, as amended and in effect on the date hereof.
“Closing” has the meaning set forth in Section 6.1.
“Closing Date” has the meaning set forth in Section 6.1.
“COBRA” means the Consolidated Omnibus Budget Reconciliation Act of 1985, as amended, and the applicable rules and regulations promulgated thereunder.
“Code” means the Internal Revenue Code of 1986, as amended.
“Contract” has the meaning set forth in Section 2.1.
“Damages” means any and all losses, costs, damages, Liabilities, liens, interest, awards, judgments, penalties, fees and expenses arising from claims, bankruptcy proceedings, demands, investigations, actions, causes of action, including, without limitation, all appeals and extensions thereof and the related legal fees.