Exhibit 99.1

 

Certain schedules in this Exhibit 99.1 have been omitted in accordance with Item 601(b)(2) of Regulation S-K.  Autobytel Inc. will furnish supplementally a copy of any omitted schedule or exhibit to the Securities and Exchange Commission upon request; provided, however, that Autobytel Inc. may request confidential treatment pursuant to Rule 24b-2 of the Securities Exchange Act of 1934, as amended, for any schedule or exhibit so furnished.

 

 

 

 

ASSET PURCHASE AGREEMENT

Dated as of September 30, 2013

by and among

Autobytel Inc.,

Advanced Mobile, LLC and Advanced Mobile Solutions Worldwide, Inc.

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

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ASSET PURCHASE AGREEMENT

This Asset Purchase Agreement is made and entered into as of September 30, 2013 ("Effective Date") by and among Autobytel Inc., a Delaware corporation ("Purchaser"), Advanced Mobile, LLC, a Delaware limited liability company ("Seller"), and Advanced Mobile Solutions Worldwide, Inc., a Delaware corporation ("Seller Parent").  Seller and Seller Parent are collectively referred to herein as the "Selling Group" and sometimes each individually as a "Selling Group Member."  Purchaser, Seller, and Seller Parent are referred to herein collectively as the "Parties" and sometimes each individually as a "Party."

BACKGROUND

Seller is engaged in the Business. Upon the terms and subject to the conditions set forth in this Agreement, Seller desires to sell to the Purchaser, and the Purchaser desires to purchase from Seller, all of the Purchased Assets and the Seller desires to assign to the Purchaser, and the Purchaser desires to assume from Seller, the Assumed Liabilities and Obligations.

In consideration of the mutual representations, warranties, covenants and agreements, and upon the terms and subject to the conditions hereinafter set forth, the Parties, intending to be legally bound, do hereby agree as follows.

ARTICLE I
DEFINITIONS

"Accounts Receivable" means all accounts or notes receivable held by Seller and any security, claim, remedy or other right to the foregoing.

"Action" means any complaint, claim, demand, prosecution, indictment, action, litigation, lawsuit, arbitration, proceeding, hearing, inquiry, audit, or investigation (whether civil, criminal, judicial or administrative, and whether formal or informal, and whether public or private) made or brought by any Person or brought or heard by or before any Governmental Authority.

"Affiliate" means, with respect to any Person, (i) each Person that, directly or indirectly, owns or controls, whether beneficially, or as a trustee, guardian or other fiduciary, more than 50% of the voting capital shares or other voting equity interests or securities of such Person, and (ii) each Person that controls, is controlled by or is under common control with such Person or any Affiliate of such Person.  For the purpose of this definition, "control" of a Person means the possession, directly or indirectly, of the power to direct or cause the direction of its management or policies, whether through the ownership of voting securities, by contract or otherwise.

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"Agreement" means this Asset Purchase Agreement and all Exhibits, Schedules and other attachments hereto, as the same may be amended from time to time in accordance with the terms hereof.

"Agreed Upon Closing Working Capital Calculation Principles" means the accounting and other principles, practices and methodologies set forth in the Preliminary Closing Working Capital Schedule which have been agreed upon by the Parties for purposes of calculating the Preliminary Closing Working Capital and the Final Closing Working Capital.

"Arbitration Organization" means the Judicial Arbitration and Mediation Service.

"Assumed Contracts" means only those Business Contracts listed on the Assumed Contracts and Liabilities Schedule.

"Assumed Contracts and Liabilities Schedule" means Exhibit B attached hereto.

"Assumed Liabilities and Obligations" means only those Liabilities of the Business listed on the Assumed Contracts and Liabilities Schedule.

"ATS" means Advanced Telecom Services, Inc., a Delaware corporation.

"Bill of Sale and Assignment" means the Bill of Sale, Assignment and Assumption Agreement substantially in the form of Exhibit G attached hereto.

"Business" means the provision of mobile marketing solutions (e.g., mobile applications, mobile portals, mobile websites, text-chat, mobile text marketing, self-service mobile messaging, quick response codes, text messaging, short message service and multimedia message service) for the automotive industry and related products and services (including without limitation, manufacturing, sales and distribution (including automotive manufacturers and dealers) of automobiles, marketing and advertising (including purchase request or leads referral), financing, warranties, insurance, parts and accessories, and service and repairs); homebuilding industry and related products and services (including without limitation, construction, manufacturing, sales and distribution (including builders and developers) of new homes (including manufactured homes), marketing and advertising (including purchase request or leads referral)); newspapers and their online properties and affiliates, and all other media (excluding other media unrelated to the automotive industry and homebuilding industry), as conducted by Seller or Seller Parent prior to the Closing Date.

"Business Contracts" means the Business Real Property Leases, the Business Intellectual Property Contracts, and the other Contracts required to be identified in any Schedule to this Agreement, including in the Disclosure Schedule (and "Business Contract" means any one of them individually).

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"Business Location State" means the Commonwealth of Pennsylvania.

"Business Day" means any day, other than a Saturday, Sunday, or any other day on which banks located in the State of California, USA are authorized or required by Law to close.

"Business Employees" means the full and part-time (if any) employees of Seller or Seller Parent.

"Closing Schedule" means Exhibit F attached hereto.

"Closing Working Capital" means the Working Capital as of the Closing Date.

"COBRA" means Section 4980B of the Code and Part 6 of Subtitle B of Title I of ERISA.

"Code" means the Internal Revenue Code of 1986, as amended, or any successor Law, and the rules and regulations issued by the IRS pursuant thereto or to any successor Law.

"Consent" means any approval, consent, permission, ratification, waiver, or other authorization of any Person (including any Governmental Authority).

"Costs of Revenues" for purposes of calculating Contingent Payments shall mean costs of revenues as determined by GAAP (as GAAP may change over the Contingent Payments Component Period), excluding estimated gross-up for customer pass-through expenses and DMI data feed accrual and including Purchaser employees used for the purpose of customer and/or text chat support, who will be placed in a unique cost center which will be included in Costs of Revenue. As of the Closing, Costs of Revenues included the following items:

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DMI Cars2Go Data Feed & Stock Photos

Reseller revenue share

Content expense

Domain name registration expense

BHI Commission

800 dealer call tracking

Bad debt expense

Elavon & AMEX credit card merchant fees

Managed Services - WebHosting.net

Customer support wages

Text chat support wages

App Developer revenue share

Short code expense

Text messaging costs

Short code set-up cost

Short code gateway fees

 

"Contingent Payments Component Schedule" means Exhibit D attached hereto.

"Contingent Payments Component Measurement Period" means each calendar quarter period within the Contingent Payments Component Period as reflected on the Contingent Payments Component Schedule.

"Contingent Payments Component Period" means the period commencing on January 1, 2014 and ending on December 31, 2016.

"Contract" means any agreement, contract, obligation, promise, note, bond, mortgage, undertaking, indenture, purchase order, sales order, instrument, lease, franchise, license, permit, understanding, arrangement, commitment or undertaking, whether written or oral, or express or implied, and in each case, including all amendments thereto.

"Current Fiscal Year" means Seller's fiscal year ending December 31, 2013.

"DOL" means the United States Department of Labor.

"Disclosure Schedule" means Exhibit L attached hereto.

"EEOC" means the United States Equal Employment Opportunity Commission.

"Electronic Transmission" means a communication (i) delivered by facsimile, telecommunication or electronic mail when directed to the facsimile number of record or electronic mail address of record, respectively, which the intended recipient has provided to the other party for sending notices pursuant to this Agreement and (ii) that creates a record of delivery and receipt that is capable of retention, retrieval, and review, and that may thereafter be rendered into clearly legible tangible form.

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"Employee Benefit Plans" means collectively, all "employee benefit plans" within the meaning of Section 3(3) of ERISA (including multiemployer plans within the meaning of Section 3(37) of ERISA), and all stock purchase, stock option, severance, employment, change-in-control, fringe benefit, collective bargaining, bonus, incentive, deferred compensation, employee loan, and other employee benefit plans (including health, medical, dental, and similar benefit plans), programs, Contracts and other arrangements, whether or not subject to ERISA, including any funding mechanism therefor now in effect or required in the future as a result of the Transactions or otherwise, whether formal or informal, oral or written, legally binding or not, under which (i) any current or former employee, or any current or former owner, director, officer, or consultant of Seller, Seller Parent or any Predecessor has any present or future right to benefits and which are contributed to, sponsored by or maintained by or for the benefit of Seller, Seller Parent or any of their respective Affiliates, or (ii) Seller or Seller Parent has or is reasonably likely to have any present or future Liability, or (iii) the Purchaser or any of its Affiliates is reasonably likely to have any Liability after the Closing.

"Encumbrance" means any mortgage, charge, claim, condition, equitable interest, community or other marital property interest, lien, option, pledge, security interest, right of first refusal, right of first option, easement, right-of-way, encroachment, or restriction of any kind, including any restriction on use, voting, transfer, receipt of income, or exercise of any other attribute of ownership and including any conditional sale or other title retention agreement, any lease in the nature thereof and the filing of or agreement to give any financing statement under the Uniform Commercial Code of any jurisdiction, and including any lien or charge arising by statute or other Laws or which secures the payment of a debt (including any Taxes due and payable) or the performance of an obligation.

"Environment" means all air, surface waters, groundwater, or land, including soil, land surface or subsurface, including all fish, wildlife, biota and all other natural resources.

"Environmental Claim" means any Action, notice or other written communication of any kind by any Governmental Authority alleging any violation of any Environmental Laws or any actual or potential Environmental Liabilities.

"Environmental Law" means any and all federal, state, local, provincial and foreign, civil and criminal laws, statutes, ordinances, orders, codes, rules, regulations, Environmental Permits, policies, guidance documents, judgments, decrees, injunctions, or agreements with any Governmental Authority, relating to the protection of health or the Environment, or worker health and safety, or governing the handling, use, generation, treatment, storage, transportation, disposal, manufacture, distribution, formulation, packaging, labeling, or Release of Hazardous Materials, whether now existing or subsequently amended or enacted, including: the Clean Air Act, 42 U.S.C. § 7401 et seq.; the Comprehensive Environmental Response, Compensation and Liability Act of 1980, 42 U.S.C. § 9601 et seq. ("CERCLA"); the Federal Water Pollution Control Act, 33 U.S.C. § 1251 et seq.; the Hazardous Material Transportation Act, 49 U.S.C. § 1801 et seq.; the Federal Insecticide, Fungicide and Rodenticide Act, 7 U.S.C. § 136 et seq.; the Resource Conservation and Recovery Act of 1976 ("RCRA"), 42 U.S.C. § 6901 et seq.; the Toxic

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Substances Control Act, 15 U.S.C. § 2601 et seq.; the Occupational Safety & Health Act of 1970, 29 U.S.C. § 651 et seq.; the Oil Pollution Act of 1990, 33 U.S.C. § 2701 et seq.; and the state analogies thereto, all as amended or superseded from time to time; and any common law doctrine, including negligence, nuisance, trespass, personal injury, or property damage related to or arising out of the presence, Release, or exposure to a Hazardous Material.

"Environmental Liabilities" means any Liabilities relating to or arising under any Environmental Laws or otherwise relating to the Environment.  Environmental Liabilities include the cost of any Response, Removal, or Remedial Action or any other action, including investigation, reporting or monitoring relating to the Environment.

"Environmental Permit" means any Governmental Authorizations under or in connection with any Environmental Law and includes any and all Orders or Contracts issued or entered into by or with a Governmental Authority under any Environmental Law.

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

"ERISA Affiliate" means any trade or business, whether or not incorporated, under common control with Seller or Seller Parent within the meaning of Section 414(b), (c), (m) or (o) of the Code.

"Excluded Assets" means only those assets of Seller listed on the Excluded Assets Schedule.

"Excluded Assets Schedule" means Exhibit C attached hereto.

"Excluded Contracts" means all Contracts to which Seller or Seller Parent is a party or bound, other than the Assumed Contracts.

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omissions or circumstances existing or occurring, or relating to periods, before the Closing or the conduct of the Business before the Closing, even if such Action or threatened Action is disclosed as an exception in the Disclosure Schedule; (v) any Liabilities arising out of the operations and business of Seller or its Predecessors or Affiliates before or after the Closing, other than Liabilities that are included in the Preliminary Working Capital Schedule; (vi) any Liabilities arising from or in connection with or relating to any Excluded Assets; (vii) any Liabilities with respect to any Indebtedness, other than Liabilities that are included in the Preliminary Working Capital Schedule or that are included in the calculation of the Final Closing Working Capital; (viii) any Environmental Liabilities; (ix) any Liabilities resulting from Seller entering into and performing its obligations in connection with, or consummating, the Transactions; (x) any Liabilities arising out of or in connection with any Employee Benefit Plans, including any failure to comply with applicable Laws with respect thereto or the governing documents thereof; (xi) any Liabilities arising out of or relating to any failure to obtain a Consent under a Nonassignable Contract before the Closing; (xii) any Liabilities for defective goods or services sold on or before the Closing Date or for damage or injury to person or property which arise out of or relate to occurrences, events, facts or circumstances that existed or occurred on or before the Closing Date; (xiii) any Liabilities to any current or former holders of any securities of Seller or any Affiliates of Seller (including any holders of any preferred stock or membership interests of Seller, and any holders of options or warrants to acquire securities of Seller), including Liabilities to pay dividends, whether or not arising out of or relating to the Transactions; and (xiv) any Liabilities for severance or other obligations to Business Employees, including any compensation or other amounts payable to any current or former employee (including any Business Employee) arising out of or relating to such Person's employment (or the termination thereof) with Seller, including hourly pay, commission, bonus, salary, accrued vacations, fringe, pension or profit sharing benefits, retention or severance pay payable to any current or former employee (including any Business Employee) of Seller.

"Federal Funds Rate" means for each day, the rate per annum (rounded upward, if necessary, to the nearest 1/100 of 1%) which is the weighted average of the rates on overnight federal funds transactions arranged on such day by federal funds brokers, computed and released by the Federal Reserve Bank of New York (or any successor).  Any change in the Federal Funds Rate shall be effective immediately without notice or demand of any kind.

"Final Holdback Release Date" means the first Business Day following the expiration of the Holdback Period.

"Financial Statements" means (i) the unaudited financial statements of Seller consisting of the balance sheets of the Seller as of December 31 in each of the years 2010, 2011 and 2012 and the related statements of income and retained earnings, stockholders' equity and cash flow for the years then ended, (ii) unaudited financial statements consisting of the Most Recent Balance Sheet and the related statements of income and retained earnings, stockholders' equity and cash flow for the eight (8) month period then ended, and (iii) the Monthly Financial Statements.

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"GAAP" means generally accepted accounting principles for financial reporting in the United States as in effect as of the Closing Date, applied consistently with past practice.

"Governing Documents" means (i) with respect to a corporate Person, such Person's (1) certificate or articles of incorporation or other formation document, as amended to date, and (2) bylaws; and (ii) with respect to a limited liability company Person, such Person's (1) certificate of formation or organization or other formation document, and (2) operating or similar agreement or document.

"Governmental Authority" means any:  (i) nation, state, county, city, town, or other jurisdiction of any nature; (ii) federal, state, local, municipal, foreign, or other government; (iii) governmental or quasi-governmental authority of any nature (including any governmental agency, branch, department, official, or entity and any court or other tribunal); (iv) multi-national organization or body; (v) stock exchange or quotation service; (vi) body exercising, or entitled to exercise, any administrative, executive, judicial, legislative, police, regulatory, or taxing authority or power of any nature; (vii) arbitrator or mediator; or (viii) any official or authorized representative of any of the foregoing.

"Governmental Authorization" means any Consent, permit, license, Order or other authorization issued, granted, given, or otherwise made available by or under the authority, or any requirement, of any Governmental Authority or pursuant to any Laws, including Environmental Permits.

"Hazardous Material" means any waste, substance or material that is classified, or otherwise characterized under or pursuant to any Environmental Law as "hazardous," "toxic," "pollutant," "contaminant," "radioactive," or words of similar meaning or effect, including petroleum and its by-products, asbestos, polychlorinated biphenyls, radon, mold, medical waste and urea formaldehyde insulation and any other substance or material that is regulated or is reasonably likely to result in liability under any Environmental Law.

"HIPAA" means Section 9801 of the Code and Part 7 of Subtitle B of Title I of ERISA.

"Holdback Amount" means Seven Hundred Fifty Thousand Dollars ($750,000.00).

"Holdback Period" means the period commencing on the Closing Date and ending on the eighteen month anniversary of the Closing Date.

"Indebtedness" means all (i) indebtedness for borrowed money, (ii) obligations evidenced by bonds, notes or similar instruments, (iii) guarantees of indebtedness of others or other commitments, obligations, or undertakings to pay any obligations of others or to assure any creditor against loss, (iv) obligations upon which interest charges are customarily paid, (v) capitalized lease obligations, (vi) obligations under conditional sale or other title retention agreements, (vii) obligations issued or assumed as the deferred purchase price of property or services, (viii) obligations secured by any Encumbrance on

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property or assets, and (ix) all accrued and unpaid interest and penalties on any of the foregoing (including prepayment penalties), and all costs, expenses and other charges included in any of the foregoing.

"Indemnification Period" means the period commencing on the Closing Date and ending on the eighteen month anniversary of the Closing Date.

"Indemnification Basket Amount" means Fifty Thousand Dollars ($50,000.00).

"Indemnification Cap Amount" equals One Million Dollars ($1,000,000.00).

"Independent Accountant" means BDO USA, LLP.

"Individual Beneficial Owners" means the following individuals who hold beneficial ownership in Seller or Seller Parent: Bret Dunlap, Robert Bentz, David Sawyer, Eric Deininger and Paul Hehn.

"Individual Beneficial Owners Indemnification, Noncompetition and Confidentiality Agreement" means the Individual Beneficial Owners Indemnification, Noncompetition and Confidentiality Agreement substantially in the form attached hereto as Exhibit K attached hereto.

"Intellectual Property" means (i) all inventions (whether patentable or unpatentable and whether or not reduced to practice), all improvements thereto, and all patents, patent applications, and patent disclosures, together with all reissuances, continuations, continuations-in-part, revisions, extensions, and reexaminations thereof; (ii) all trademarks, service marks, trade dress, logos, trade names, and other indications of origin, and all corporate names, including all goodwill associated therewith, and all applications, registrations, and renewals in connection therewith in any jurisdiction; (iii) all copyrights and works of authorship (whether copyrightable or not), and all applications, registrations, and renewals in connection therewith in any jurisdiction; (iv) all mask works and all applications, registrations, and renewals in connection therewith in any jurisdiction; (v) all Trade Secrets and Confidential Information; (vi) all Software; (vii) all websites, website content, and domain names and short codes (including registrations thereof); (viii) all other intellectual property and/or proprietary rights; (ix) all tangible embodiments of any of the foregoing (in whatever form or medium), including all copies thereof; and (x) all claims and causes of action for infringement, misappropriation or dilution of any of the foregoing.

"Intellectual Property Assignment" means Exhibit H attached hereto.

"Interim Holdback Release Date" means the first Business Day following the twelve-month anniversary of the Closing Date.

"Inventory" means any inventory, including all raw materials, work-in-process, finished goods and products under research and development, and all spare parts and

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accessories thereto, and all other materials and supplies used, usable or held for use in the production of finished goods, wherever located.

"IRS" means the United States Internal Revenue Service or any successor agency and, to the extent relevant, the United States Department of the Treasury.

"Knowledge" (and any derivations thereof), with respect to Seller or Seller Parent, means the actual knowledge of any of Seller's officers or limited liability company Managers or of any of Seller Parent's officers or directors, and the knowledge that any such individuals would reasonably be expected to have, given their respective roles and responsibilities, after due inquiry.

"Laws" means any federal, state, local, municipal, foreign, international, multinational, or other order, constitution, law, ordinance, principle of common law, regulation, statute, rule, treaty, permit, license, certificate, judgment, Order, decree, award or other decision or requirement of any arbitrator or Governmental Authority.

"Liability" means, with respect to any Person, any liability or obligation of such Person of any kind, nature, character or description, whether known or unknown, absolute or contingent, accrued or unaccrued, disputed or undisputed, liquidated or unliquidated, secured or unsecured, joint or several, due or to become due, vested or unvested, executory, determined, determinable or otherwise, and whether or not the same is required to be accrued on the financial statements of such Person.

"Material Adverse Effect" means any material adverse change in, or effect on, the assets, financial condition or results of operations of Seller or the Business or that could reasonably be expected to have any material adverse change in, or effect on, Purchaser's ability to operate the Business after the Closing; provided, however, that "Material Adverse Effect" shall not include any event, occurrence, fact, condition, or change, directly or indirectly, arising out of or attributable to: (i) any changes, conditions or effects in the United States or foreign economies or securities or financial markets in general; (ii) changes, conditions or effects that affect generally the industries in which the Business operates; (iii) any particular facts or circumstances of which Purchaser had actual knowledge prior to Closing that would constitute the basis for a claim for indemnification under Article VI; (iv) the effect of any changes in applicable Laws or accounting rules, including GAAP; or (v) conditions caused by acts of terrorism or war (whether or not declared) or any man-made disaster or acts of God..

"Monthly Financial Statements"  means unaudited balance sheets of Seller as at the last day of each calendar month during the period commencing January 1, 2013 and ending August 31,  2013 and income statements, statements of cash flow and statements of shareholders' equity of Seller for the partial year ending on the last day of each such calendar month.

"Most Recent Balance Sheet" means the unaudited balance sheet of Seller as at August 31, 2013.

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"Most Recent Fiscal Year End" means December 31, 2012.

"Off-the-Shelf Software" means commercially available desktop computer Software licensed non-exclusively under "shrink wrap" or other comparable standard form licenses.

"Open Source Software" means each of: (a) any Software that contains, or is derived in any manner (in whole or in part) from, any Software that is distributed as free Software, open source Software (e.g., GNU General Public License, Apache Software License, or MIT License), or pursuant to similar licensing and distribution models, and (b) any Software that requires as a condition of use, modification, hosting, and/or distribution of such Software, or of other Software used or developed with, incorporated into, derived from, or distributed with such Software, that such Software or other Software: (i) be disclosed or distributed in source code form, (ii) be licensed for the purpose of making derivative works, (iii) be redistributed, hosted or otherwise made available at no or minimal charge, or (iv) be licensed, sold or otherwise made available on terms that: (x) limit in any manner the ability to charge license fees or otherwise seek compensation in connection with marketing, licensing or distribution of such Software or other Software, (y) grant the right to decompile, disassemble, reverse engineer or otherwise derive the source code or underlying structure of such Software or other Software, or (z) limit in any manner the ability to enforce the Intellectual Property Rights in such Software.

"Opinion of Seller Counsel" means the opinion of Royer Cooper Cohen Braunfeld, LLC, counsel to Seller and Seller Parent in form acceptable to Purchaser.

"Order" means any judgment, decision, order, injunction, decree, award, or writ of any Governmental Authority.

"Ordinary Course of Business" means an action taken by a Person with respect to the Business that is consistent with past practices of the Business and is similar in nature and magnitude to actions taken in normal day-to-day operations of the Business (including with respect to quantity and frequency) consistent with past practices and was not taken in contemplation of any of the Transactions.

"PBGC" means the Pension Benefit Guaranty Corporation.

"Permitted Encumbrances" means (i) liens for Taxes not yet due and payable or being contested in good faith by appropriate procedures; (ii) mechanics', carriers', workmen's, repairmen's or other like liens arising or incurred in the ordinary course of business; (iii) liens arising under original purchase price conditional sales contracts and equipment leases with third parties entered into in the ordinary course of business; and (iv) other imperfections of title or Encumbrances, if any, that have not had, and will not have, a Material Adverse Effect.

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"Person" means any natural person, corporation (including any non-profit corporation), general or limited partnership, limited liability company, joint venture, estate, trust, association, organization, labor union or other entity, or a Governmental Authority.

"Predecessor" means any Person whose Liabilities, including Tax Liabilities or Environmental Liabilities, have been retained or assumed by Seller, or to which Seller is otherwise the successor, either contractually or by operation of Law.

"Preliminary Closing Working Capital" means the Closing Working Capital estimated by the Parties based on the Most Recent Balance Sheet for purposes of the Closing, which amount is Forty Thousand Seven Hundred One Dollars ($40,701.00).

"Preliminary Closing Working Capital Adjustment" means the difference between the Preliminary Closing Working Capital and the Target Closing Working Capital, which amount is Forty Thousand Seven Hundred One Dollars ($40,701.00).

"Preliminary Closing Working Capital Schedule" means Exhibit E attached hereto, which exhibit includes a good faith calculation of the Preliminary Closing Working Capital and the Preliminary Working Capital Adjustment in accordance with the Agreed Upon Closing Working Capital Principles based on the Most Recent Balance Sheet.

"Purchased Assets" means all of the assets, rights, privileges, interests, licenses and properties, of every type and description, owned, leased, licensed, used, useable or held for use by Seller or Seller Parent in connection with the Business, other than the Excluded Assets, including all of the assets listed on the Purchased Assets Schedule.

"Purchased Assets Schedule" means Exhibit A attached hereto.

"Related Party" means (i) Seller, (ii) Seller Parent, (iii) any former holder of any securities of Seller or Seller Parent, (iii) any current or former director, manager, officer, employee, shareholder or member of Seller or Seller Parent, (iv) any partner or joint venturer of Seller or Seller Parent; (v) any Person related by blood, marriage or adoption to any Person referenced in the foregoing clauses (i)-(iv); (vi) any trustee or beneficiary of any trust established by any Person referenced in the foregoing clauses (i)-(v) or of which any Person referenced in the foregoing clauses (i)-(v) is a beneficiary; and (vii) any Affiliate of any of the foregoing.

"Release" means any spilling, leaking, pumping, pouring, emitting, emptying, discharging, injecting, escaping, leaching, dumping, or disposing of a Hazardous Material into the Environment.

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"Response," "Removal," and "Remedial Action" have the meanings ascribed to them in Sections 101(23)-101(25) of the CERCLA.

"Restricted Period" means the period commencing on the Closing Date and ending on the fifth annual anniversary of the Closing Date.

"Software" means all computer software and subsequent versions thereof, including source, object, executable, or binary codes, objects, comments, screens, user interfaces, report formats, templates, menus, buttons and icons, and all files, data, materials, manuals, design notes and other items and documentation related thereto or associated therewith.

"Tangible Personal Property" means any machinery, equipment, computers, furniture, tools, supplies, Inventory, motor vehicles, and other tangible personal property, including all attachments and accessories to, and replacements of, any of the foregoing (and any parts or components thereof), and all express or implied warranties of, and rights against all, manufacturers, suppliers, sellers, lessors or licensors of any of the foregoing (or any parts or components thereof).

"Target Closing Working Capital" means a Closing Working Capital of Zero Dollars ($0.00) as of the Closing Date.

"Tax Authority" means any branch, office, department, agency, instrumentality, court, tribunal, officer, employee, designee, representative, or other Person that is acting for, on behalf or as a part of any Governmental Authority that is engaged in or has any power, duty, responsibility or obligation relating to the legislation, promulgation, interpretation, enforcement, regulation, monitoring, supervision or collection of or any other activity relating to any Tax or Tax Return.

"Tax Proceeding" means any audit, examination, review, reassessment, litigation or other administrative or judicial proceeding or other Action relating to any Tax for which Seller is (or is asserted to be) or may be liable.

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"Tax Return" means any return, election, declaration, report, schedule, information return, document, information, opinion, statement, or any attachment or amendment to any of the  foregoing (including any consolidated, combined or unitary return) submitted or required to be submitted to any Tax Authority and any claims for refund of Taxes paid.

"Trade Secrets and Confidential Information" means know-how, trade secrets, confidential information, proprietary information, information of or regarding the Business and its operations, assets, results of operations, customers, vendors,  plans and financial condition, data, databases and technical information and all rights in, arising out of or associated therewith.

"Transaction Documents" means this Agreement and the Transfer Documents.

"Transactions" means the transactions contemplated by the Transaction Documents.

"Transfer Documents" means the Bill of Sale and Assignment, Intellectual Property Assignment and such other deeds, agreements and instruments of sale, assignment and transfer, each in form and substance mutually satisfactory to the Purchaser, as Purchaser deems necessary or appropriate to transfer good, valid and marketable title to the Purchased Assets from Seller to Purchaser, free and clear of all Encumbrances other than Permitted Encumbrances.

"Transferred Business Employees" means only those Business Employees listed on the Transferred Business Employees Schedule, which Business Employees have accepted employment with the Purchaser or Purchaser promptly following the Closing in accordance with an employment offer from either Purchaser or Purchaser.

"Transferred Business Employees Schedule" means Exhibit I attached hereto.

"Transition Services and Space Sharing Arrangements Agreement" means the Transition Services and Space Sharing Arrangements Agreement between Purchaser, Seller, Seller Parent and ATS substantially in the form of Exhibit J attached hereto.

"Valuation Consultant" means Strategic Equity Group.

"WARN" means the federal Worker Adjustment and Retraining Notification Act or any similar state or local laws, rules or regulations.

"Working Capital" means the result of subtracting the aggregate amount of the current Liabilities of the Business as of the Closing Date (as of immediately before the Closing) that are included in the Assumed Liabilities and Obligations from the aggregate amount of the current assets of the Business as of the Closing Date that are included in the Purchased Assets, all as determined in accordance with the Agreed Upon Working Capital Calculation Principles.

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	Term	Section
	"Affiliate Assignee" "Ben Franklin" "Business Intellectual Property"	7.3 5.7(b) 3.16
	"Business Intellectual Property Contracts"	3.16
	"Business Names"	Purchased Assets Schedule
	"Business Products"	3.16
	"Business Records"	Purchased Assets Schedule
	"Business Real Property"	Purchased Assets Schedule
	"Business Real Property Leases"	3.14
	"Business Relationships"	Purchased Assets Schedule
	"Business Services"	3.16
	"Closing Balance Sheet"	2.8
	"Closing Date"	2.1
	"Closing Effective Time"	2.1
	"Closing Working Capital Dispute Notice"	2.8
	"Closing Working Capital Disputed Item"	2.8
	"Closing Working Capital Dispute Resolution Period"	2.8
	"Compliance Policies"	3.8
	"Consent Required For Closing"	Closing Schedule
	"Contingent Payment"	5.11
	"Contingent Payments Calculation"	5.11
	"Contingent Payments Calculation Date"	5.11
	"Contingent Payments Calculation Statement"	5.11
	"Contingent Payments Calculation Objection Notice"	5.11

 

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	"Contingent Payments Component"	2.7
	"Damages" "Disputed Holdback Claim Resolution"	6.1 6.9
	"Encumbrance Termination Documents"	5.6
	"Final Closing Working Capital"	2.8
	"Final Closing Working Capital Statement" "Holdback Claim" "Holdback Claim Notice" "Holdback Claim Objection" "Holdback Release Amount"	2.8 6.7 6.7 6.7 6.7
	"Indemnified Party"	6.3
	"Indemnifying Party"	6.3
	"Insurance Policy" or "Insurance Policies"	3.22
	"Licensed Business Intellectual Property"	3.16
	"Material Business Relationships"	3.18
	"Material Suppliers"	3.18
	"Nonassignable Contract"	2.3
	"Owned Business Intellectual Property"	3.16
	"Party" or "Parties"	Preamble
	"Payoff Letters"	Closing Schedule
	"Powers of Attorney"	5.9
	"Purchase Consideration"	2.7
	"Purchase Consideration Allocation"	2.9
	"Purchased Accounts Receivable"	Purchased Assets Schedule
	"Purchasing Group Indemnitees"	6.1
	"Related Party Contract"	3.24

 

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	"Review Period"	5.11
	"Required Intellectual Property Assignments"	Closing Schedule
	"Selling Group Governmental Authorizations"	3.8
	"Selling Group Consents and Approvals"	Closing Schedule
	"Selling Group Indemnitees"	6.2
	"Transferred Business Employees Employment Documents"	Closing Schedule
	"Uncollected Purchased Accounts Receivable Amount"	2.8
	"Uncollected Purchased Accounts Receivable"	2.8
	"Unresolved Closing Working Capital Disputed Items"	2.8

 

 

ARTICLE II
TERMS OF PURCHASE AND SALE

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after the Closing (i) use commercially reasonable efforts to obtain such Consent as soon as reasonably possible after the Closing at Seller's sole cost and expense (including payment of any fees and costs imposed in connection with the request for, or as a condition to the issuance of, any such Consent) and without any amendments to or changes in the material terms of (or any of the respective material rights and obligations of the parties under) any Nonassignable Contract, and cooperate with Purchaser in endeavoring to obtain, such Consent at no out-of-pocket cost or expense to Purchaser; and (ii) if and for so long after the Closing as such Consent has not been obtained, cooperate with Purchaser in any commercially reasonable arrangement proposed by Purchaser that is designed to provide for Purchaser the material benefits (including all material economic benefits), claims, and rights under any such Nonassignable Contract, including the enforcement for the benefit of Purchaser of any and all rights of Seller against any other party thereto.  In obtaining any Consent with respect to any Nonassignable Contract, Seller will not agree to or permit any material amendments or material changes to any of the terms of (or any of the respective rights and obligations of the Parties under) any Nonassignable Contract without the consent of Purchaser, such consent not to be unreasonably withheld, conditioned or delayed.  Notwithstanding the foregoing, only the Consent Required For Closing shall be a condition to the Closing, provided that Seller shall use commercially reasonable efforts to obtain all Consents to Nonassignable Contracts before the Closing, and provided further that Seller shall be and remain obligated to use commercially reasonable efforts to obtain after the Closing as provided in this Section 2.3(b) any such Consents that are not obtained before the Closing.

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THE PURCHASED ASSETS OR ANY BUSINESS EMPLOYEES, ALL OF WHICH SHALL BE AND REMAIN THE LIABILITIES OF SELLER OR SELLER PARENT, AND THEIR RESPECTIVE AFFILIATES OR PREDECESSORS, AS APPLICABLE. ANY LIABILITY OR OBLIGATION OF SELLER OR SELLER PARENT AND THEIR RESPECTIVE AFFILIATES AND PREDECESSORS NOT CONSTITUTING ASSUMED LIABILITIES AND OBLIGATIONS SHALL CONSTITUTE EXCLUDED LIABILITIES AND OBLIGATIONS.

 

 

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Purchaser and Seller shall work in good faith to agree on the final Purchase Consideration Allocation.  Any disputes regarding the Purchase Consideration Allocation which are not resolved by the Parties within thirty (30) days shall be submitted to the Independent Accountant for resolution (in accordance with and subject to the same terms as set forth in Section 2.8(e) with respect to resolution of Unresolved Closing Working Capital Disputed Items) and the Independent Accountant's determination shall be final and binding on, and non-appealable by, the Parties. Seller and the Purchaser shall prepare Internal Revenue Service Form 8594 for the taxable year that includes the Closing Date in accordance with the requirements of Section 1060 of the Code and the Purchase Consideration Allocation, and shall timely file or cause to be timely filed with the IRS such Form 8594.  Seller and the Purchaser shall prepare their respective federal, state, and local tax returns and reports employing the Purchase Consideration Allocation and shall not take a position in any Tax Proceeding or otherwise that is inconsistent with the Purchase Consideration Allocation, except that nothing contained in this Agreement shall require Seller or Purchaser to contest, beyond the exhaustion of its administrative remedies before any Tax Authority, and Seller and Purchaser shall not be required to litigate before any court, including the United States Tax Court, any proposed deficiency or adjustment by any Tax Authority that challenges the Purchase Consideration Allocation.  Seller and the Purchaser shall give prompt notice to each other of the commencement of any Tax Proceeding or the assertion of any proposed deficiency or adjustment by any Tax Authority that challenges the Purchase Consideration Allocation.

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ARTICLE III
REPRESENTATIONS AND WARRANTIES OF THE
SELLING GROUP

Seller and Seller Parent hereby jointly and severally represent and warrant to Purchaser that, except as set forth on the Disclosure Schedule, which exceptions shall be deemed to be part of the representations and warranties made hereunder, knowing and intending that Purchaser is relying on the accuracy of such representations and warranties in entering into the Transactions, the representations set forth in this Article III are true and complete as of the Closing.  The Disclosure Schedule shall be arranged in sections corresponding to the numbered and lettered sections and subsections contained in this Article III, and the disclosures in any section or subsection of the Disclosure Schedule does not qualify other sections and subsections of this Article III without specific reference or cross reference to specific disclosure made in another section or subsection unless it is readily apparent from a reading of the disclosure on the face of the Disclosure Schedule (without any review of any documents referenced on the face of the Disclosure Schedule) that such disclosure is intended to be applicable to the disclosure required under a different section of the Disclosure Schedule.

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or has any rights to acquire any securities of Seller or Seller Parent or otherwise has any rights or interests whatsoever in Seller or Seller Parent or any of their respective assets or profits.  No Person other than Seller or Seller's owners or the lenders identified in Section 3.10(b) of the Disclosure Schedule has any direct or indirect rights in or to the proceeds of the Transactions. No stockholder or member, as applicable, of Seller or Seller Parent has any appraisal rights under applicable Law as a result of the execution of the Transaction Documents or the Closing of the Transactions.

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Schedule, neither Seller, Seller Parent nor to the Knowledge of Seller or Seller Parent, any Related Party has any beneficial interest, direct or indirect, in any Person (other than Seller or Seller Parent) (i) which is or has been a supplier of any goods or services to Seller or Seller Parent, (ii) from which Seller or Seller Parent has received fees, commissions, compensation or benefits, or (iii) which is engaged in the Business or is a competitor of Seller or Seller Parent.

 

 

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or other Person who is or may be in a position to help or hinder the Business (or assist Seller or Seller Parent in connection with any actual or proposed transaction) which: (i) is reasonably likely to subject Seller, Seller Parent, the Business or Purchaser to any Liability or penalty in any civil, criminal or governmental Action; (ii) if not given in the past, is reasonably likely to have had an adverse effect on the assets, business, prospects, financial condition or operations of the Business; or (iii) if not continued in the future, is reasonably likely to have an adverse effect on the Business after the Closing or which might subject Seller, Seller Parent or Purchaser to an Action or to any Liability or penalty in any Action.

 

 

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periods indicated therein, and changes in the financial positions of Seller and the Business, and Seller Parent with respect to the Business, for the respective periods therein indicated.  All prepaid expenses included in the Purchased Assets that would be reflected as assets of Seller or the Business, or of Seller Parent with respect to the Business, in financial statements represent payments theretofore made by Seller or Seller Parent in the Ordinary Course of Business, the benefit and advantage of which may be obtained and realized by Purchaser after the Closing within the time anticipated for such realization, but in no event later than twelve (12) months following the Closing Date. The accounting books and records of Seller and the Business, and Seller Parent with respect to the Business, have been kept in accordance with GAAP applied consistently with past practices, and do and will fairly, accurately and completely, reflect the operating and financial transactions of Seller and the Business, Seller Parent with respect to the Business, on such basis in all material respects.

 

 

 

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subject of any Action, or threatened Action, by any Governmental Authority with regard to such classification of any such Business Employees or other Persons.

 

 

 

 

 

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standing. Section 3.16(a) of the Disclosure Schedule lists all fees, actions, or renewals that are due within six (6) months after Closing to maintain Owned Business Intellectual Property. Seller has provided Purchaser with true and complete copies of file histories, records, documents, certificates, office actions, and material correspondence related to all Owned Business Intellectual Property that is subject to any issuance, registration, application or other filing by, to or with any Governmental Authority or authorized private registrar in any jurisdiction.

 

 

 

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upon consummation of the Transactions, Purchaser will exclusively own and have possession of, and shall have the right to use, all such source codes and related documentation, as applicable, free from any Encumbrances.  Seller or Seller Parent also owns and has possession of, and Purchaser will also own and have possession of after the Closing, all other existing documentation with respect to all Business Intellectual Property.

 

 

 

 

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cause or permit the acceleration or other changes of any right or obligation or the loss of any benefit thereunder.  There are no material disputes pending or, to the Knowledge of Seller or Seller Parent, threatened under any Assumed Contract.  No party to any Assumed Contract has expressed to Seller or Seller Parent orally or in writing its intention to cancel or otherwise terminate or alter in any material respect its relationship with Seller or Seller Parent as it relates to the Business, and neither Seller nor Seller Parent has any information that could lead it to believe that any such Person intends to cancel or terminate, reduce or limit, or otherwise alter in any material respect, its relationship with Seller or as relating to the Business, Seller Parent or with Purchaser after the Closing, whether as a result of the consummation of the Transactions or otherwise.  To the Knowledge of Seller and of Seller Parent, there is no reasonable basis (other than any existing right to terminate for convenience or without cause) for any party to any Business Contract to cancel or otherwise terminate, or to reduce or limit, or to otherwise alter in any material respect its relationship with Seller or, with respect to the Business, Seller Parent or with Purchaser after the Closing.  Subject to Section 2.3(b), all of the Assumed Contracts will be transferred to Purchaser at the Closing without any loss of rights or benefits thereunder, increase or change in obligations thereunder, or additional cost or penalty to Purchaser.

 

 

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Benefit Plan to which such continuation coverage requirements apply..  There has been no violation of the health insurance obligations imposed by HIPAA with respect to any Employee Benefit Plan which is a "group health plan" (as defined in Section 5000(b)(1) of the Code and Section 706 of ERISA) to which such insurance obligations apply (including the requirement under HIPAA that certificates of creditable coverage be provided to certain employees and their dependents).

 

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and are sufficient for compliance with all Laws and Contracts related to the Business to which Seller or, with respect to the Business, Seller Parent is a party or by which it is bound.

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would, after the date hereof, be required, as the case may be, by Section 5.1 of this Agreement.

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ARTICLE IV
REPRESENTATIONS AND WARRANTIES OF PURCHASER

Purchaser hereby represents and warrants to Seller and Seller Parent, knowing and intending that Seller and Seller Parent are relying on the accuracy of such representations and warranties in entering into the Transactions, as set forth in this Article IV.

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ARTICLE V
POST-CLOSING MATTERS

 

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Predecessors or Affiliates (provided, however, that to the extent and when a Transferred Business Employee is eligible for, enrolls in and is accepted for enrollment in any health Employee Benefit Plan provided to the Transferred Business Employees by Purchaser, then Seller and Seller Parent shall not have any further obligation for such claims or benefits to the extent such claims or benefits are covered by the health Employee Benefit Plan made available to the Transferred Business Employees), and (B) all worker's compensation claims of any current or former employee (including any Business Employee) or agent of Seller, Seller Parent or their respective Predecessors or Affiliates which relate to events occurring on or before the Closing Date or their employment with Seller, Seller Parent or their respective Predecessors or Affiliates, and Seller and Seller Parent shall pay or cause to be paid all such amounts to the appropriate Persons as and when due.

 

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of Purchaser; provided, however, that Trade Secrets and Confidential Information shall not include any of the foregoing that is or becomes generally available to the public without breach of any obligation of confidentiality owed by Seller or Seller Parent any Selling Group Member to Purchaser or information that is disclosed to a third party by a Person, other than Seller, Seller Parent or their respective Affiliates or employees, that is not bound by separate confidentiality obligations to Purchaser. Notwithstanding the foregoing, if a Selling Group Member is required in the course of judicial or administrative Action or governmental inquiries to disclose any Trade Secrets and Confidential Information, such Selling Group Member shall give Purchaser prompt written notice thereof so that Purchaser may seek an appropriate protective order and/or waive the Selling Group Member's compliance with the confidentiality provisions of this Section 5.3.

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requested by Purchaser) in the collection of the Purchased Accounts Receivable. Any Uncollected Purchased Accounts Receivable remaining uncollected as of the ninetieth (90^th) day after the Closing shall be transferred to Seller and the amount of such Uncollected Purchased Accounts Receivable shall be reimbursed to Purchaser through the Closing Working Capital Adjustment in accordance with Section 2.8.  If Purchaser subsequently collects any amounts which were included in the Uncollected Purchased Accounts Receivable Amounts and reimbursed to Purchaser through the Closing Working Capital Adjustment, Purchaser shall promptly remit to Seller or Seller Parent (as directed by Seller and Seller Parent) the amount so collected.  Seller and Seller Parent shall use commercially reasonable collection practices in collecting any Uncollected Purchased Accounts Receivable and will not take any adverse collection action or other action which may adversely affect Purchaser's relationship with any Person with whom it has a business relationship after the Closing, including commencing any collection Action or referring any such Uncollected Purchased Accounts Receivable to any third party for collection, without first consulting in good faith with the Purchaser.

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Seller Parent timely contest such Tax in good faith by appropriate procedures, Seller and Seller Parent shall only be required to pay such Taxes as are determined to be due after conclusion of the procedures.

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(iii) If, following the delivery of a Contingent Payments Calculation Objection Notice to Purchaser by Seller and the resolution of any objections of Seller

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contained therein, any additional amounts are owed by Purchaser to Seller related to a previously paid Contingent Payment, such amounts shall be paid by Purchaser in cash by wire transfer of immediately available funds to the bank account designated by Seller within three (3) Business Days following the resolution of the dispute described in such Contingent Payments Calculation Notice.

(i) Purchaser shall operate the Business in a commercially reasonable manner and shall not take any actions that are specifically intended to avoid or reduce any of the Contingent Payments.

(iii)  Additionally, if Purchaser materially alters the distributorship and reseller model of the Business, which has the effect of delaying or temporarily reducing sales of Seller's products and services, the Seller shall receive reasonable credit towards the targets for each of the Contingent Payments on account of such delay or reduction as set forth on the Contingent Payments Component Schedule or, at the election of Purchaser, an extension of one or more Contingent Payment Component Periods to be reasonably agreed upon by the Parties.

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separately provide a price for the mobile products of the Business consistent with the price at which Purchaser sells such products on a standalone basis, Seller shall receive an allocation of the revenues related to such sale for the purpose of calculating any Contingent Payment as agreed in writing between the Purchaser and the Seller, acting in a commercially reasonable manner.

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results in an Annual Contingent Payment Amount that is less that the Aggregate Quarterly Payments Amount, then Seller shall pay to Purchaser the difference between the Aggregate Quarterly Contingent Payments Amount and the Annual Contingent Payment Amount. Payments to a Party under this Section 5.11(g) shall be made in full in cash by wire transfer of immediately available funds to the bank account designated by the Party receiving the payment. The review, reconciliation and resolution of disputes procedures set forth in Section 5.11(b) shall apply to this Section 5.11(g) as if an Annual Contingent Payments Calculation Statement was deemed a quarterly Contingent Payments Calculation Statement.

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Notwithstanding the foregoing, only the Required Intellectual Property Assignments shall be a condition to the Closing, provided that Seller and Seller Parent shall use commercially reasonably efforts to obtain all Intellectual Property Assignments before the Closing, and provided further that Seller and Seller Parent shall be and remain obligated to obtain after the Closing any such Intellectual Property Assignments that are not obtained before the Closing.

 

ARTICLE VI
INDEMNIFICATION

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Party can show that the failure to give such notice on a timely basis materially and adversely affected the Indemnifying Party's ability to defend the claim.

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and other materials reasonably required by them and in the possession or under the control of the Indemnified Party for the use of the Indemnifying Party and its representatives in defending any such claim, and shall in other respects give reasonable cooperation in such defense.

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any third party recoveries, nor shall any Purchasing Group Indemnitee be obligated to continue to pursue insurance recovery or third party recovery if initially pursued. In the event an actual insurance recovery, third party recovery or Tax benefit relating to an indemnification payment is received after the Purchasing Group Indemnitee has received an indemnification payment hereunder that did not take into account such insurance recovery, third party recovery or Tax benefit, the Purchasing Group Indemnitee shall promptly pay the Seller an amount equal to the lesser of such insurance recovery, third party recovery or Tax benefit and the amount of the related indemnification payment.  Any Purchasing Group Indemnitee seeking indemnification under this Article VI shall have a duty to act in a commercially reasonable manner to mitigate all Damages for which such Purchasing Group Indemnitee seeks indemnification, and the costs or expenses of any such mitigation shall constitute additional Damages subject to indemnification. The Parties acknowledge the intent of this Section 6.6 is to avoid any actual double recovery of Damages by any Purchasing Group Indemnitee in the event of any actual recovery of insurance proceeds, third party recoveries or realization of Tax benefits.

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ARTICLE VII
MISCELLANEOUS

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[The remainder of this page intentionally left blank; signature page and exhibits follow.]

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IN WITNESS WHEREOF, each of the Parties has caused this Agreement to be executed on its behalf as of the date first above written.

Purchaser

	Autobytel Inc., a Delaware corporation
	By:	/s/ Glenn E. Fuller
		Glenn E. Fuller, Executive Vice President, Chief Legal and Administrative Officer and Secretary

Purchaser Notice Contact Information:

Autobytel Inc.

18872 MacArthur Blvd., Suite 200

Irvine, California 92612-1400

Attention:  Glenn E. Fuller

Executive Vice President, Chief Legal and

Administrative Officer and Secretary

Fax:  (949) 862-1323

Email Address:  ABTLLegal@autobytel.com

Seller

	Advanced Mobile, LLC, a Delaware limited liability company
	By:	/s/ Bret Dunlap
		Bret Dunlap, President and Chief Executive Officer

Seller Parent

	Advanced Mobile Solutions Worldwide, Inc., a Delaware corporation
	By:	/s/ Bret Dunlap
		Bret Dunlap, President and Chief Executive Officer

Seller and Seller Parent Notice Contact Information:

Advanced Mobile, LLC

Advanced Mobile Solutions Worldwide, Inc.

1150 First Avenue, Suite 105

King of Prussia, PA 19406

Attention: Bret Dunlap, Chief Executive Officer

Fax: 215.392.5813

Email Address: bretd@advancedmobile.com

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Purchased Assets Schedule

All of the assets, rights, privileges, interests, and properties, of every type and description, owned, leased, used, useable or held for use by Seller or, with respect to the Business, by Seller Parent. The Purchased Assets include, without limitation, the following:

·	All current assets of Seller or Seller Parent, including all Accounts Receivable of Seller or Seller Parent ("Purchased Accounts Receivable"), but excluding current assets included in the Excluded Assets.

·	All Tangible Personal Property owned, leased, licensed, used, useable or held for use by Seller or Seller Parent (with respect to the Business), wherever located, and whether or not carried on the books of Seller or Seller Parent.

·	All work in process of whatever nature.

·	All Business Intellectual Property.

·	All rights, title and interests of Seller or Seller Parent in and to any land, buildings, and facilities, and the improvements and fixtures attached or appurtenant thereto, and all easements, licenses, rights and appurtenances relating thereto ("Business Real Property").

·	All keys to buildings, offices, security codes, passwords, and identification numbers pertaining to the operation of the Business Real Property.

·	All Assumed Contracts.

·

All accounts and relationships with any Persons who pay Seller or Seller Parent (with respect to the Business), or from whom Seller or Seller Parent (with respect to the Business) derives, any revenues and other Persons having business dealings with Seller or Seller Parent (with respect to the Business ("Business Relationships").

·

All books, records, data and information, in any form, related to or concerning the Business, the Transferred Business Employees, the Purchased Assets, or the Assumed Liabilities and Obligations, whether or not in the possession of Seller or Seller Parent, including all lists of current and prospective Business Relationships, all supplier and vendor lists, records, files and information, service and warranty records, equipment logs, operating guides and manuals, personnel records and files of or relating to the Transferred Business Employees, marketing and promotional materials used in the Business, whether in electronic or paper form, including advertising materials, product data, price lists, sales materials, scientific and commercial publications, market research and other materials associated with the Business (collectively, the "Business Records").

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·	All Governmental Authorizations required to conduct the Business, to the extent transferable.

·	All prepaid expenses and deposits paid by or to Seller or Seller Parent (with respect to the Business), including all advances made by Seller or Seller Parent to any Person, and all other prepaid items, credits, and discounts for or toward the purchase of goods, services, or Inventory.

·	All telephone and fax numbers related to the Business.

·	All goodwill and going concern value of and related to the Business.

·	All bank accounts, checking accounts, trust accounts, suspense accounts or similar accounts, and safe deposit boxes of Seller or Seller Parent (with respect to the Business), other than those bank accounts listed on the Excluded Assets Schedule.

·	All insurance benefits, including rights and proceeds, arising from or relating to the Business, Purchased Assets or the Assumed Liabilities and Obligations.

·	The entity names of Seller and Seller Parent and any other names under which Seller or Seller Parent conducts the Business (collectively, the "Business Names")

·	All rights, claims, credits, causes of action, rights to indemnification and contribution or rights of set-off of Seller or Seller Parent (with respect to the Business) against third parties, whether choate or inchoate, known or unknown, contingent or non-contingent.

·	All express or implied warranties of manufacturers, sellers, or lessors of any Purchased Assets and all other warranties and guaranties for the benefit of Seller or Seller Parent (with respect to the Business).

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Assumed Contracts and Liabilities Schedule

The following are the only Assumed Contracts and Assumed Liabilities and Obligations:

·	All contracts listed on Section 3.17(a)(iv) of the Disclosure Schedules.

·	All confidentiality, noncompetition and intellectual property assignment agreements of Business Employees and third parties that benefit Seller or Seller Parent.

·	INFOIQ Service Agreement by and between Digital Motorworks, Inc. and Advanced Mobile Solutions Worldwide, Inc. dated February 9, 2009.

·	Service Agreement for Mobile Messaging Services by and between Advanced Mobile, LLC and CellTrust Corporation dated December 1, 2011.

·	Lease Agreement by and among Parkview Tower Associates, L.P., Advanced Mobile, LLC and Advanced Telecom Services, Inc. executed April 1, 2013.

·	License Agreement by and between Internet Brands, Inc. and Advanced Mobile, LLC dated December 1, 2011

·	Product License and Development Services Agreement by and between New Start Mobile, LLC and Advanced Mobile Solutions Worldwide, Inc. dated September 1, 2010 (being amended and restated effective as of the Closing)

·	Amended and Restated Product License and Development Services Agreement by and between Fontera, Inc. and Advanced Mobile Solutions Worldwide, Inc. dated September 3, 2010 (being amended and restated effective as of the Closing)

·	Development, License and Services Agreement by and between Advanced Mobile Solutions, Inc. and Advanced Telecom Services, Inc. dated June 1, 2008 (being amended and restated as of the Closing)

·	Cars2Go Distribution Agreement by and between Advanced Mobile, LLC and Advanced Telecom Services, Inc. dated June 19, 2011 (being terminated effective as of the Closing)

·	Agreements with the following Vendors:

o	CoreDial, LLC

o	Lime Systems

o

CellTrust

o

Neustar

o	Webhosting.net

o

Comcast

o

GoDaddy

o	Host Gator

o

eFax

o

LinkedIn

o	Logmein.com

o

Verizon

o	AT&T Mobile

o

Dial 800

o

iTransact

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The performance of Seller's obligations which arise after the Closing Date under the Assumed Contracts, but expressly not including any Liabilities, whenever arising or asserted, which relate to or arise out of any breach or violation of any Assumed Contract, or any default or failure to perform under any Assumed Contract prior to the Closing Effective Time.

·	Only payment obligations under the Assumed Contracts arising after the Closing Date, unless such payment obligation is included in the Purchased Assets included in the Closing Working Capital.

·	Accounts Payable that are included in the Preliminary Working Capital Schedule or that are incurred prior to the Closing in the Ordinary Course of Business and consistent with past practice that are not past due and that are included in the calculation of the Final Closing Working Capital.

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Excluded Assets Schedule

The following assets of Seller constitute the only Excluded Assets:

·	All cash and cash equivalents.

·	Tax Returns and Tax records of Seller and the Seller entity's seal, minute books, stock books and other records having to do with the organization, capitalization and governance of Seller.

·	All rights of Seller under this Agreement.

·	All Employee Benefit Plans and all amounts held or invested by Seller in connection therewith

·	Toronto Dominion Bank Account # ******5735

·	Seller Parent's Membership Interest in Seller.

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Contingent Payments Component Schedule

Following the Closing, and as additional consideration for the Purchased Assets, Seller shall be entitled to receive from Purchaser (subject to the terms and conditions set forth in this Contingent Payments Component Schedule) additional amounts based on the following:

This Exhibit has been omitted in accordance with Item 601(b)(2) of Regulation S-K.  Autobytel Inc. will furnish supplementally a copy of any omitted schedule or exhibit to the Securities and Exchange Commission upon request; provided, however, that Autobytel Inc. may request confidential treatment pursuant to Rule 24b-2 of the Securities Exchange Act of 1934, as amended, for any schedule or exhibit so furnished.

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Preliminary Closing Working Capital Schedule

 

This Exhibit has been omitted in accordance with Item 601(b)(2) of Regulation S-K.  Autobytel Inc. will furnish supplementally a copy of any omitted schedule or exhibit to the Securities and Exchange Commission upon request; provided, however, that Autobytel Inc. may request confidential treatment pursuant to Rule 24b-2 of the Securities Exchange Act of 1934, as amended, for any schedule or exhibit so furnished.

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Exhibit F
Closing Schedule

·	This Agreement, duly executed by Seller and Seller Parent.

·	The Bill of Sale and Assignment, duly executed by Seller and Seller Parent.

·	The Intellectual Property Assignment, duly executed by Seller.

·	All other Transaction Documents to which Seller or Seller Parent is a party, duly executed by Seller and Seller Parent, as applicable.

·	Written Consents for assignment of the Nonassignable Contracts and all other Consents referenced in Section 3.4(b) of the Disclosure Schedule and designated therein as a "Consent Required For Closing" (collectively the "Consents Required For Closing").

·

Seller and Seller Parent shall have obtained and delivered to Purchaser all Governmental Authorizations and other Consents Required for Closing from third parties, and shall have made or given all filings, submissions and notifications required under any Law applicable to such party or any of its Affiliates, that may be or become necessary for the performance of their respective obligations under the Transaction Documents or the consummation of the Transactions. Neither Seller nor Seller Parent will permit or agree to any changes to the terms of, or waive or agree to waive any rights with respect to, the Business or any Purchased Assets (including any Contract related to a Consent Required For Closing included therein) in connection with or to obtain any such Consent without the prior written approval of Purchaser.

·

At or before the Closing, Seller and Seller Parent shall deliver to Purchaser, written evidence, in form and substance reasonably satisfactory to Purchaser, that the boards of directors, stockholders and all members of Seller and Seller Parent have consented to and duly authorized the Transactions and waived any dissenter's appraisal or similar rights that any of them may have with respect to the Transactions (collectively, the "Selling Group Consents and Approvals").

·	Intellectual Property Assignments from the Persons listed on Section 3.16(f) of the Disclosure Schedule, if any, and designated therein as an "Intellectual Property Assignment Required For Closing" (collectively the "Required Intellectual Property Assignments").

·	A good standing certificate of Seller and Seller Parent as of a date within five (5) days of the Closing Date.

·	Payoff letters or similar written instructions, in form and substance reasonably acceptable to Purchaser, for the repayment in full of all Indebtedness of Seller as of

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the Closing Date to Advanced Telecom, Ben Franklin, Gray Kremen and Frank Washington, or which is secured by or creates any Liens on the Purchased Assets ("Payoff Letters"), which Payoff Letters shall provide the amount necessary to pay off such Indebtedness in full on the Closing Date. To the extent a Liability, Encumbrance, or Lien is not the subject of a Payoff Letter, Seller shall have delivered (i) written evidence in form and substance satisfactory to the Purchaser of the repayment in full of all Indebtedness which is secured by Encumbrances on any Purchased Assets, and (ii) the Encumbrance Termination Documents together with written evidence, in form and substance satisfactory to the Purchaser, of the filing of the Encumbrance Termination Documents.

·	UCC searches for each of Seller and Seller Parent showing no Encumbrances other than the Ben Franklin Encumbrance.

·	Employment agreements and other employment documents in the form agreed upon by Purchaser and the applicable Transferred Business Employee executed by each Transferred Business Employee ("Transferred Business Employee Employment Documents").

·	A Section 1445 Certification dated as of the Closing Date, stating, under penalties of perjury, the transferor's United States taxpayer identification number and that the transferor is not a foreign person, pursuant to Section 1445(b)(2) of the Code.

·	The Encumbrance Termination Documents.

·	The Powers of Attorney duly executed by Seller and Seller Parent.

·	A properly completed and duly executed IRS Form W-9 for each of Seller and Seller Parent.

·	The Transition Services and Space Sharing Arrangements Agreement duly executed by Seller and Seller Parent.

·	The Opinion of Seller Counsel.

·	The Individual Beneficial Owners Indemnification, Non-Competition and Confidentiality Agreement executed by each of the Individual Beneficial Owners.

·	The new or amended and restated license, vendor or reseller agreements, as applicable, from the following

o

Fontera

o

NSM

o

ATS

o	LC Software

o

CARS/AMS

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·	This Agreement, duly executed by Purchaser.

·	The Transition Services and Space Sharing Arrangements Agreement duly executed by Purchaser.

·	All other Transaction Documents to which Purchaser is a party, duly executed by Purchaser.

·	The Transferred Business Employee Employment Documents.

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Form of Bill of Sale, Assignment and Assumption Agreement

 

BILL OF SALE, ASSIGNMENT AND ASSUMPTION AGREEMENT

This Bill of Sale, Assignment and Assumption Agreement ("Bill of Sale") is made and entered into as of September 30, 2013 ("Effective Date") by and among Advanced Mobile, LLC, a Delaware limited liability company ("Seller"), and Advanced Mobile Solutions Worldwide, Inc., a Delaware corporation ("Seller Parent") (Seller and Seller Parent are collectively referred to herein as the "Selling Group" and sometimes each individually as a "Selling Group Member"), and Autobytel Inc., a Delaware corporation ("Purchaser").

Background

This Bill of Sale is made and given by Seller and Seller Parent pursuant to and in accordance with that certain Asset Purchase Agreement dated as of the Effective Date by and among the Purchaser, Seller and Seller Parent ("Asset Purchase Agreement"), pursuant to which the Seller and Seller Parent have each agreed to sell to the Purchaser, and the Purchaser has agreed to purchase from Seller and Seller Parent, the Purchased Assets.  Capitalized terms used herein but not defined herein shall have the respective meanings given to them in the Asset Purchase Agreement.

Now, therefore, in consideration of the premises and other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, and intending to be legally bound, the parties hereto hereby agree as follows:

 

2.	Assumed Contracts and Assumed Liabilities and Obligations.

 

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(i)

to demand, receive and collect any and all of the Purchased Assets and to give receipts and releases for and with respect to the same, or any part thereof; and

(ii)

to institute and prosecute, in the name of each Selling Group Member, as applicable, or otherwise, any and all proceedings at law, in equity or otherwise, that Purchaser or its successors and assigns may deem proper in order to collect or reduce to possession any of the Purchased Assets and in order to collect or enforce any claim or right of any kind hereby assigned or transferred, or intended so to be; and to do all things legally permissible, required or reasonably deemed by Purchaser to be required to recover and collect the Purchased Assets and to use each Selling Group Member's name in such manner as Purchaser may reasonably deem necessary for the collection and recovery of same.

Each Selling Group Member hereby declares that the foregoing powers are coupled with an interest and are and shall be irrevocable by each Selling Group Member.

 

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IN WITNESS WHEREOF, the parties have caused this Bill of Sale to be duly executed by their respective authorized officers as of the date first above written.

Seller

Advanced Mobile, LLC

Bret Dunlap, President and Chief

  Executive Officer

Seller Parent

Advanced Mobile Solutions Worldwide, Inc.

 

 

                                          

Purchaser

Autobytel Inc.

Glenn E. Fuller, Executive Vice

President, Chief Legal and

Administrative Officer and

Secretary

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Form of Intellectual Property Assignment

See attached

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INTELLECTUAL PROPERTY ASSIGNMENT

This Intellectual Property Assignment ("Assignment") is made and entered into as of September 30, 2013 ("Effective Date") by and among Advanced Mobile, LLC, a Delaware limited liability company ("Seller"), and Advanced Mobile Solutions Worldwide, Inc., a Delaware corporation ("Seller Parent") (Seller and Seller Parent are collectively referred to herein as the "Assignors" and sometimes each individually as an "Assignor"), and Autobytel Inc., a Delaware corporation ("Assignee").  The Assignors and Assignee are hereinafter referred to collectively as the "Parties" and sometimes each individually as a "Party."

Background

This Assignment is made and given by Seller and Seller Parent pursuant to and in accordance with that certain Asset Purchase Agreement dated as of the Effective Date by and among the Assignee, Seller and Seller Parent ("Asset Purchase Agreement"), pursuant to which the Seller and Seller Parent have each agreed to sell and assign to Assignee, and Assignee has agreed to purchase  and acquire from Seller and Seller Parent, the Purchased Assets.  Capitalized terms used herein but not defined herein shall have the respective meanings given to them in the Asset Purchase Agreement.

Now, therefore, in consideration of the premises and other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, and intending to be legally bound, the parties hereto hereby agree as follows:

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All rights in, to and under the Intellectual Property to be held and enjoyed by Assignee to the same extent as would have been held and enjoyed by such Assignors had this sale, assignment and transfer not been made; any and all rights to royalties, profits, compensations, license fees or other payments or remuneration of any kind relating to the Intellectual Property from the Effective Date; and all claims or causes of action such Assignors have or may have in connection with the Intellectual Property, including, but not limited to, the right to sue and recover damages for any and all past infringements of any of the Intellectual Property.

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[Remainder of Page Intentionally Left Blank; Signature page follows]

---

 

IN WITNESS WHEREOF, the Parties have caused this Intellectual Property Assignment to be duly executed as of the Effective Date.

 

Advanced Mobile, LLC     By:________________________        Bret Dunlap, President

 

 

Advanced Mobile Solutions Worldwide, Inc.     By:________________________       Bret Dunlap, President

Autobytel Inc.

Autobytel Inc.     By:_________________________       Glenn E. Fuller, Executive Vice        President, Chief Legal and       Administrative Officer and       Secretary

 

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STATE OF PENNSYLVANIA   ü

On September _____, 2013, before me, ____________________________, notary public, personally appeared Bret Dunlap who proved to me on the basis of satisfactory evidence to be the person whose name is subscribed to the within instrument, and acknowledged to me that he executed the same in his authorized capacity, and that by his signature on the instrument the person, or the entity upon behalf of which the person acted, executed the instrument.

I certify under PENALTY OF PERJURY under the laws of the State of California that the foregoing paragraph is true and correct.

WITNESS my hand and official seal.

Notary Signature

 

On September _____, 2013, before me, Lezli E. Beach, notary public, personally appeared Glenn E. Fuller who proved to me on the basis of satisfactory evidence to be the person whose name is subscribed to the within instrument, and acknowledged to me that he executed the same in his authorized capacity, and that by his signature on the instrument the person, or the entity upon behalf of which the person acted, executed the instrument.

I certify under PENALTY OF PERJURY under the laws of the State of California that the foregoing paragraph is true and correct.

WITNESS my hand and official seal.

Notary Signature

 

 

 

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APPENDIX A

Patents and Patent Applications:

Title:  System and Method for Message Tethering and Tagging

Application #: 61/720,561

NOTE:  Provisional Application filed on 10/31/2012.  A "Non-Provisional" must be filed one year later.

Domain Names:

ADVANCEDMOBILE.COM

AMSIMAGES.US

APOLLOPREOWNED.MOBI

BENNAFORD.MOBI

BETHESDAAUTO.MOBI

BUILDERTEXTCHAT.COM

C-ROCK.MOBI

CARS2GO.COM

CARS2GO.COM.BR

CARS2GO.COM.MX

CARS2GO.MOBI

CARS2GO.MX

CARS2GOMOBILE.COM

CARSTOGO.MOBI

COLUMBIACHEV.MOBI

COMPASSPOINTEHOMES.MOBI

DANAFLM.MOBI

DEALERTEXT2CHAT.COM

DEALERTEXTCHAT.COM

FORDTEXTCHAT.COM

GARNETFORD.MOBI

GETAHYUNDAI.MOBI

GETAMAZDA1.MOBI

HERITAGEWAKEFOREST.MOBI

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HOMES2GO.US

KBHOME.MOBI

MACHAIKFL.MOBI

MACHAIKVICTORIA.MOBI

MAZDAGEORGETOWN.MOBI

MAZDAKILLEEN.MOBI

MCARS2GO.COM

MCCLUSKEYCHEVROLET.MOBI

MOBILEAPPLEAD.COM

MSOUTH.MOBI

MYHOMES2GO.MOBI

PCFORD.MOBI

PEACHTREECOMMUNITIES.MOBI

ROGERBEASLEY.MOBI

ROGERBEASLEYUSED.MOBI

SCOTTFELDER.MOBI

SFGATEREALESTATE.MOBI

TERRAMORHOMES.MOBI

TEXASUSEDONLINE.MOBI

TEXTCHAT.MOBI

TEXTUSNOW.COM

TMFORD.MOBI

TOMMASANO.MOBI

VILLAGEPARKHOMES.MOBI

CARS2GOCENTRAL.COM

CHRONMOBILE.COM

GETAMAZDA.MOBI

MYCARS2GO.COM

MYCLASSIFIEDS2GO.COM

NJ2GO.COM

SMSPROMOS.COM

SUITESMS.COM

 

Short Codes:

50123

45555

49469

35555

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ASSIGNMENT

WHEREAS, Advanced Mobile, LLC, a Delaware corporation (hereinafter "ASSIGNOR"), represents and warrants that it is the sole owner of the entire right, title, and interest to certain new and useful improvements for which ASSIGNOR has filed the following United States applications for Letters Patents in the United States (hereinafter "the Patent Applications"):

Application No.	Filing Date	Title
61/720,561	October 31, 2012	SYSTEM AND METHOD FOR MESSAGE TETHERING AND TAGGING

WHEREAS, Autobytel Inc., a Delaware corporation (hereinafter "ASSIGNEE"), desires to purchase the entire right, title and interest in and to the inventions disclosed in the Patent Applications;

NOW, THEREFORE, in consideration of One Dollar ($1.00) paid to ASSIGNOR, and other good and valuable consideration, the receipt of which is hereby acknowledged, ASSIGNOR hereby further acknowledges that it has sold, assigned, and transferred, and by these presents does hereby sell, assign, and transfer, unto ASSIGNEE, its successors, legal representatives, and assigns, the entire right, title, and interest throughout the world in, to, and under the said improvements, and the said Patent Applications and all Patents that may be granted thereon, and all provisional applications relating thereto (including but not limited to U.S. Provisional Application No(s). 61/720,561, filed October 31, 2012 (respectively if plural applications)), and all divisions, continuations, reissues, reexaminations, renewals, and extensions thereof, and all rights of priority under International Conventions and applications for Letters Patent that may hereafter be filed for said improvements or for the said Patent Applications in any country or countries foreign to the United States; and ASSIGNOR hereby authorizes and requests the Commissioner of Patents of the United States, and any Official of any country foreign to the United States, whose duty it is to issue patents on applications as aforesaid, to issue all Letters Patent for said improvements and all Letters Patents resulting from the Patent Applications to ASSIGNEE, its successors, legal representatives, and assigns, in accordance with the terms of this Agreement.

ASSIGNOR does hereby sell, assign, transfer, and convey to ASSIGNEE, its successors, legal representatives, and assigns all claims for damages and all remedies arising out of any violation of the rights assigned hereby that may have accrued prior to the date of assignment to ASSIGNEE, or may accrue hereafter, including, but not limited to, the right to sue for, collect, and retain damages for past infringements of the said Patents before or after issuance;

ASSIGNOR hereby covenants and agrees that it will communicate to ASSIGNEE, its successors, legal representatives, and assigns any facts known to ASSIGNOR respecting the Patent Applications immediately upon becoming aware of those facts, and that it will testify in any legal proceeding involving any of the Patent Applications, will sign all lawful papers, execute all divisional, continuing, and reissue applications, make all rightful oaths, and will generally do everything possible to aid ASSIGNEE, its successors, legal representatives, and assigns to obtain and enforce the Patent Applications in all countries.

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IN TESTIMONY WHEREOF, I hereunto set my hand and seal this 30th day of September, 2013.

Advanced Mobile, LLC, a Delaware limited

 liability company

On ________________, before me, ____________________________, notary public, personally appeared _____________________[signor's name] who proved to me on the basis of satisfactory evidence to be the person(s) whose name(s) is/are subscribed to the within instrument, and acknowledged to me that he/she/they executed the same in his/her/their authorized capacity(ies), and that by his/her/their signature(s) on the instrument the person(s), or the entity upon behalf of which the person(s) acted, executed the instrument.

I certify under PENALTY OF PERJURY under the laws of the State of California that the foregoing paragraph is true and correct.

WITNESS my hand and official seal.

    Notary Signature

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Transferred Business Employees

This Exhibit has been omitted in accordance with Item 601(b)(2) of Regulation S-K.  Autobytel Inc. will furnish supplementally a copy of any omitted schedule or exhibit to the Securities and Exchange Commission upon request; provided, however, that Autobytel Inc. may request confidential treatment pursuant to Rule 24b-2 of the Securities Exchange Act of 1934, as amended, for any schedule or exhibit so furnished.

 

 

 

 

 

 

 

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Form of Transition Services and Space Sharing Arrangements Agreement

See attached

 

 

 

---

 

This Transition Services and Space Sharing Arrangements Agreement ("Agreement") is made and entered into effective as of September 30, 2013 ("Effective Date"), by and among Autobytel Inc., a Delaware corporation ("Purchaser"), Advanced Telecom Services, Inc., a Delaware corporation ("ATS"), Advanced Mobile, LLC, a Delaware limited liability company ("Seller"), and Advanced Mobile Solutions Worldwide, Inc., a Delaware corporation ("Seller Parent").

Background

Concurrently with the execution of this Agreement, Purchaser, Seller, and Seller Parent have entered into the Asset Purchase Agreement (the "Asset Purchase Agreement") pursuant to which Purchaser has purchased from Seller all or substantially all of the assets of Seller and Seller's business ("Purchased Assets and Business").

Prior to the closing of the foregoing acquisition, ATS and Seller and Seller's Parent, who are Affiliates, shared certain personnel, office space and other items on a cost-sharing basis, and on or about September 1, 2013 moved to the Purchaser Office Space.  Pursuant to the Asset Purchase Agreement, the lease for the Purchaser Office Space, which had been originally entered into by ATS and Seller, jointly, has been assigned to and assumed by Purchaser as of the Effective Date.  The parties desire to provide for certain transition services from ATS and certain of Seller's personnel who are not being employed by Purchaser as well as for space sharing arrangements for ATS to continue to share space with Purchaser in the Purchaser Office Space after the Closing.

In order to document the foregoing, and in consideration of the mutual covenants and promises contained herein and for other good and valuable consideration, the receipt and adequacy of which is hereby acknowledged, the parties hereto agree as follows.

ARTICLE I

DEFINITIONS

As used herein, the terms below shall have the following meanings:

"Affiliates" means, with reference to a specified Person, (i) a Person that, directly or indirectly, through one or more intermediaries, controls, is controlled by or is under common control with, the specified Person, (ii) any Person that is an officer, partner or trustee of, or serves in a similar capacity with respect to, the specified Person, or for which the specified Person is an officer, partner or trustee or serves in a similar capacity or (iii) any member of the Immediate Family of the specified Person.

"ATS, Seller and Seller Parent Transition Services and Arrangements" means the services and arrangements described on the ATS, Seller and Seller Parent Transition Services Schedule to be provided by ATS, Seller or Seller Parent, as the case may be, to Purchaser.

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"ATS, Seller and Seller Parent Transition Services and Arrangements Schedule" means Exhibit A attached hereto.

"Confidential Information" means, with respect to a designated party hereto, all trade secrets and other proprietary and confidential information relating to the designated party, including, without limitation, data; existing and prospective customer, vendor and supplier lists and files; obligations; documents; financial and accounting statements and records, business plans, budgets and projections; prospective customer proposals; technical information; marketing materials; and employee related information of the designated party.  Confidential Information shall not include (i) any Confidential Information that subsequently becomes publicly available without breach of any obligation of confidentiality owing to the owner of the Confidential Information; (ii) Confidential Information that is independently derived or developed by a party without use of the Confidential Information of the other party; (iii) Confidential Information that becomes available on a non-confidential basis from a third party that is not bound by a confidentiality agreement with or subject to any obligation or duty of confidentiality to the owner of the Confidential Information or (iv) disclosure that is required by applicable Law, Rule, Regulation or Order, provided that the party required to disclose the Confidential Information shall provide the owner of the Confidential Information with prompt notice of any such order prior to disclosure so that appropriate protective orders may be sought.

"Damages" is as defined in Section 5.2 hereof.

"Electronic Transmission" means a communication (i) delivered by facsimile, telecommunication or electronic mail when directed to the facsimile number of record or electronic mail address of record, respectively, which the intended recipient has provided to the other party for sending notices pursuant to the Agreement and (ii) that creates a record of delivery and receipt that is capable of retention, retrieval, and review, and that may thereafter be rendered into clearly legible tangible form.

"Encumbrance" means any claim, lien, pledge, option, charge, license, easement, security interest, deed of trust, mortgage, right-of-way, encroachment, building or use restriction, conditional sales agreement, encumbrance, adverse claim or other right of third parties, whether voluntarily incurred or arising by operation of law, and includes, without limitation, any agreement to give any of the foregoing in the future, and any contingent sale or other title retention agreement or lease in the nature thereof.

"Existing Cost Sharing Agreement" means that certain Premises, Administrative and Personnel Cost Sharing Agreement dated as of June 11, 2008 between Seller Parent and ATS.

"Law, Rule, Regulation or Order" means any statute, law, rule, regulation, notice or filing requirement, permit, ordinance, code, guideline, judgment, decision, consent decree, injunction, ruling or order of any federal, state or local court or governmental agency, department or authority or any arbitration authority that is binding on or applicable or related to specified party.

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"Person" means and includes an individual and any corporation, partnership, joint venture, limited liability company, trust, unincorporated organization, government or any department or agency thereof, or any other entity.

 

"Purchaser Office Space" means 1150 First Avenue; Suite 105; King of Prussia, PA 19406.

"Purchaser Transition Services and Arrangements" means the services and arrangements described on the Purchaser Transition Services Schedule to be provided by Purchaser to ATS.

"Purchaser Transition Services and Arrangements Schedule" means Exhibit B attached hereto.

"Transition Services and Arrangements" means the transition services and arrangements to be provided by the parties to each other under this Agreement.

"Transition Services and Arrangements Schedules" means the ATS, Seller and Seller Parent Transition Services and Arrangements Schedule and the Purchaser Transition Services and Arrangements Schedule.

ARTICLE II

TRANSITION SERVICES AND ARRANGEMENTS

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DAMAGES, INCLUDING LOST PROFITS OR REVENUES, FOR FAILURE TO PROVIDE TRANSITION SERVICES AND ARRANGEMENTS, EVEN IF THE PARTY PROVIDING TRANSITION SERVICES AND ARRANGEMENTS HAS BEEN ADVISED OF THE POSSIBILITY OF SUCH DAMAGES.  THE TRANSITION SERVICES AND ARRANGEMENTS ARE PROVIDED ON AN "AS-IS" BASIS, WITHOUT REPRESENTATION OR WARRANTY OF ANY TYPE OR NATURE, WHETHER EXPRESS OR IMPLIED, INCLUDING ANY IMPLIED WARRANTIES OF FITNESS FOR A PARTICULAR PURPOSE, MERCHANTABILITY, INFORMATIONAL CONTENT, NON-INFRINGEMENT, INTERFERENCE WITH OR QUIET ENJOYMENT OR OTHERWISE.

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ARTICLE III

INVOICING AND PAYMENT TERMS

ARTICLE IV

TERM AND TERMINATION

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ARTICLE V

ADDITIONAL OBLIGATIONS OF PARTIES

---

 

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its own cost, participate in the investigation, trial and defense of such lawsuit or action and any appeal arising therefrom.  The parties shall cooperate with each other in any notifications to insurers.

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amounts for which such party is indemnified hereunder shall not be a condition precedent to recovery which shall be paid as such amounts are incurred.

ARTICLE VI

GENERAL PROVISIONS

---

---

possible to the terms and provisions of this Agreement.  Any term or provision which cannot be so modified or reformed will be deleted, and the remaining terms and provisions will continue in full force and effect.

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fees, and subject to Section 6.11(a), reasonable costs and expenses incurred to resolve such dispute and to enforce any final judgment.

[REMAINDER OF PAGE INTENTIONALLY LEFT BLANK]

 

 

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IN WITNESS WHEREOF, the parties have executed this Agreement as of the Effective Date.

ATS   Advanced Telecom Services, Inc.     By: ________________________________________________________________                                                                  Robert J. Bentz, President   Contact Name:  Robert Bentz   Contact Address: 1150 First Avenue, Suite 105 King of Prussia, PA  19406   Contact Telephone No.:  610.254.7191   Contact Facsimile No.:  215.392.5813   Contact Email Address: bobb@atsmobile.com   With copy to: ATS Mobile 1150 First Avenue, Suite 105 King of Prussia, PA  19406   Seller   Advanced Mobile, LLC   By: ___________________________________________________________________                                                                  Bret Dunlap, Chief Executive  Officer

Purchaser   Autobytel Inc.     By:  ___________________________________________________________                                                                       Glenn E. Fuller, Executive Vice   President, Chief Legal and   Administrative Officer and   Secretary   Contact Name:  John Skocilic   Contact Address: Autobytel Inc. 18872 MacArthur Blvd., Suite 200 Irvine, CA  92612-1400   Contact Telephone No.:  949.757.8926   Contact Facsimile No.:  949. 797.0416   Contact Email Address: johns@autobytel.com   With copy to: Autobytel Inc. Legal Department 18872 MacArthur Blvd., Suite 200 Irvine, CA  92612-1400 Facsimile No.: 949.862.1323 Attention:  Chief Legal Officer

Contact Name: Bret Dunlap   Contact Address: 1150 First Avenue, Suite 105 King of Prussia, PA 19406   Contact Telephone No.: 610.254.7190   Contact Facsimile No.: 215.392.5813   Contact Email Address: bretd@advancedmobile.com   With copy to: Advanced Mobile, LLC 1150 First Avenue, Suite 105 King of Prussia, PA 19406   Seller Parent   Advanced Mobile Worldwide Solutions, Inc.   By: _________________________________________________________________                                                                  Bret Dunlap, CEO   Contact Name:  Bret Dunlap   Contact Address: Advanced Mobile Solutions Worldwide, Inc. 1150 First Avenue, Suite 105 King of Prussia, PA  19406   Contact Telephone No.:  610.254.7190   Contact Facsimile No.:  215.392.5813   Contact Email Address: bretd@advancedmobile.com   With copy to: Advanced Mobile Solutions Worldwide, Inc. 1150 First Avenue, Suite 105 King of Prussia, PA  19406

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EXHIBIT A

ATS, SELLER AND SELLER PARENT TRANSITION SERVICES SCHEDULE

The following Transition Services shall be provided by ATS, Seller or Seller Parent, as applicable, to Purchaser:

For a period of up to four (4) months after the Effective Date, ATS shall provide the following with regard to ATS' servers and related services:

·	File services

·	Data backup

·	Local network connectivity

·	Power for Purchaser servers

·	Rack space for Purchaser servers

Purchaser intends to terminate these transition services within four (4) months after the Effective Date.

Until such time as Purchaser transfers the cable TV service for the office to a Purchaser account, ATS shall provide Purchaser with access to the Office Cable Television Service.

For a period of up to four (4) months after the Effective Date, ATS shall continue to provide Office Telephone Services to Purchaser. Purchaser intends to terminate this transition service within four (4) months after the Effective Date.

The current Cannon copier used by Seller and ATS is owned by ATS.  As long as Purchaser continues to use the copier, use of the copier shall continue to be provided to Purchaser.

For a period of up to four (4) months after the Effective Date, ATS shall continue to provide Office Computers and Printers to Purchaser. Purchaser intends to terminate this transition service within four (4) months after the Effective Date.

ATS shall provide the use of the office furniture from the office that had been leased by ATS and shared by Seller and Seller Parent prior to the move to the Purchaser Office Space Purchaser may terminate this transition service at any time upon thirty (30) days prior written notice to ATS.

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For a period of up to three (3) months after the Effective Date, Seller shall use its commercially reasonable efforts to make available the services of Margie Varallo (customer contract transition, customer invoicing, support and transition and changes to merchant account processing for customers paying by credit card) and Paul Hehn (services of a chief financial officer nature) to Purchaser on a part time basis (with the understanding that Mr. Hehn's services shall be primarily on nights and weekends due to his other job commitments) at $50 and $150 per hour, respectively. Purchaser intends to terminate this transition service within three (3) months after the Effective Date.

Seller and Seller Parent shall arrange to provide Purchaser full access to account number 367965860, ABA # 031101266, Swift Code CBNAUS33 at Toronto Dominion bank for purpose of obtaining payments made to such account on Purchased Accounts Receivable.

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EXHIBIT B

PURCHASER TRANSITION SERVICES SCHEDULE

Continuing as long as ATS occupies the ATS Transition Office Space, Purchaser will provide ATS the following Transition Services and Arrangements:

Purchaser Office Space.

·	General Liability: $1,000,000 per occurrence/$2,000,000 aggregate

·	Employers Liability: $500,000 Employers Liability (part B of workers compensation coverage).

Purchaser shall be named as additional insured on the General Liability policy, subrogation shall be waived, and policies shall be primary and non-contributory to Purchaser's policies.

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Purchaser shall provide the following networking services to ATS (based on level of services existing as of the Effective Date):

·	Local network connectivity

·	Power for ATS servers

·	Rack space for ATS servers

Once Purchaser takes over the Office Telephones and Service, which is anticipated to be within four (4) months after the Effective Date, upon request by ATS, Purchaser shall provide ATS with Office Telephones and Services.

Once Purchaser transfers the Office Cable Television Service to Purchaser's account, Purchaser will provide ATS with access to the Office Cable Television Service.

Purchaser shall provide the office cubicles for the cubicle areas located in the ATS Transition Office Space.

ATS will pay to Purchaser a monthly fee of Two Thousand Six Hundred Seventy-Four Dollars and Fifty-Four Cents ($2,674.54), which represents a 50/50 sharing of the following lease and office expenses: rent, telephones, internet and CATV, and webhosting.  In addition, the parties will share 50/50 the monthly utility costs for the entire office space, with ATS paying to Purchaser such amount each month. This allocation is based on the relative headcount of ATS, Seller and Seller Parent on the one hand and Purchaser on the other. This amount is subject to change based on changes in relative headcount. The monthly fee is also subject to adjustment for increases in rent, telephones, internet and CATV, and webhosting.

 

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SCHEDULE B-1

ATS TRANSITION OFFICE SPACE

 

 

 

This Schedule has been omitted in accordance with Item 601(b)(2) of Regulation S-K.  Autobytel Inc. will furnish supplementally a copy of any omitted schedule or exhibit to the Securities and Exchange Commission upon request; provided, however, that Autobytel Inc. may request confidential treatment pursuant to Rule 24b-2 of the Securities Exchange Act of 1934, as amended, for any schedule or exhibit so furnished.

 

 

 

 

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Form of Individual Beneficial Owners Indemnification, Noncompetition and Confidentiality Agreement

See attached

 

 

 

---

This Indemnification, Noncompetition and Confidentiality Agreement ("Agreement") is made and entered into effective as of September 30, 2013 ("Effective Date"), by and among Autobytel Inc., a Delaware corporation ("Purchaser"), and the individual named on the signature page to this Agreement ("Beneficial Owner").

Background

Concurrently with the execution of this Agreement, Purchaser, Advanced Mobile, LLC, a Delaware limited liability company ("Seller"), Advanced Mobile Solutions Worldwide, Inc., a Delaware corporation ("Seller Parent") have entered into the Asset Purchase Agreement pursuant to which Purchaser has purchased from Seller and Seller Parent all or substantially all of their assets and the business and goodwill associated with such assets ("Purchased Assets"). Beneficial Owner is a beneficial owner of equity interests in Seller or Seller Parent and will be entitled to receive a portion of the acquisition consideration for the sale of the Purchased Assets to Purchaser.

It is recognized and understood by the parties hereto that the Purchased Assets and the goodwill associated with the Purchased Assets are extremely valuable to Purchaser and that Beneficial Owner's entering into this Agreement constitutes a material inducement to Purchaser to enter into the Asset Purchase Agreement and consummate the Transactions.

In order to document the foregoing, and in consideration of the mutual covenants and promises contained herein and for other good and valuable consideration, the receipt and adequacy of which is hereby acknowledged, the parties hereto agree as follows.

ARTICLE I

DEFINITIONS

Capitalized terms used herein but not defined herein shall have the same meaning for such terms as set forth in the Asset Purchase Agreement. As used herein, the terms below shall have the following meanings:

"Affiliates" means, with reference to a specified Person, (i) a Person that, directly or indirectly, through one or more intermediaries, controls, is controlled by or is under common control with, the specified Person, (ii) any Person that is an officer, partner or trustee of, or serves in a similar capacity with respect to, the specified Person, or for which the specified Person is an officer, partner or trustee or serves in a similar capacity or (iii) any member of the immediate family of the specified Person.

"Asset Purchase Agreement" means that certain Asset Purchase Agreement dated as of the Effective Date by and among Purchaser, Seller and Seller Parent.

"Business" means the provision of mobile marketing solutions (e.g., mobile applications, mobile portals, mobile websites, text-chat, mobile text marketing, self-service mobile messaging, quick response codes, text messaging, short message service and multimedia message service)

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for the automotive industry and related products and services (including without limitation, manufacturing, sales and distribution (including automotive manufacturers and dealers) of automobiles, marketing and advertising (including purchase request or leads referral), financing, warranties, insurance, parts and accessories, and service and repairs); homebuilding industry and related products and services (including without limitation, construction, manufacturing, sales and distribution (including builders and developers) of new homes (including manufactured homes), marketing and advertising (including purchase request or leads referral)); newspapers and their online properties and affiliates, and all other media (excluding other media unrelated to the automotive industry and homebuilding industry), as conducted by Seller or Seller Parent prior to the Effective Date.

"Electronic Transmission" means a communication (i) delivered by facsimile, telecommunication or electronic mail when directed to the facsimile number of record or electronic mail address of record, respectively, which the intended recipient has provided to the other party for sending notices pursuant to this Agreement and (ii) that creates a record of delivery and receipt that is capable of retention, retrieval, and review, and that may thereafter be rendered into clearly legible tangible form.

"Knowledge" (and any derivations thereof), with respect to Beneficial Owner, means the actual knowledge of Beneficial Owner and the knowledge that Beneficial Owner would reasonably be expected to have, given Beneficial Owner's role and responsibilities with Seller and/or Seller Parent, after due inquiry.

"Restricted Period" means the period commencing on the Effective Date and ending on the fifth anniversary of the Closing Date.

"Restricted Territory" means the United States of America.

ARTICLE II

RESTRICTIVE COVENANTS

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unenforceability of any such covenant or provision as written shall not invalidate or render unenforceable the remaining covenants or provisions hereof, and any such invalidity or unenforceability in any jurisdiction shall not invalidate or render unenforceable such covenant or provision in any other jurisdiction.

ARTICLE III

INDEMNIFICATION

For purposes of Article VI of the Asset Purchase Agreement, the terms of which are incorporated herein by reference, Beneficial Owner shall be deemed a Selling Group Member as if Beneficial Owner was a party to the Asset Purchase Agreement and included in the definition of Selling Group Members and shall be bound by the provisions of Article VI of the Asset Purchase Agreement as if Beneficial Owner were a Selling Group Member, but only with respect to any Damages resulting from fraud, willful misconduct or intentional misrepresentation on the part of Beneficial Owner or to which Beneficial Owner had Knowledge.

ARTICLE IV

TERM AND TERMINATION

ARTICLE V

GENERAL PROVISIONS

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right hereunder, nor any single or partial exercise of any rights hereunder, preclude any other or further exercise thereof or the exercise of any other right hereunder.

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or against any of the parties hereto by reason of the extent to which any such party or its counsel participated in the drafting thereof.  Captions and headings of sections contained in this Agreement are for convenience only and shall not control the meaning, effect or construction of this Agreement.  Time periods used in this Agreement shall mean calendar periods unless otherwise expressly indicated.

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IN WITNESS WHEREOF, the parties have executed this Agreement as of the Effective Date.

Beneficial Owner     ____________________________       Contact Name:    Contact Address:         Contact Telephone Number:   Contact Facsimile Number:   Contact Email Address:   With copy to: Advanced Mobile, LLC Parkview Tower 1150 First Avenue, Suite 105 King of Prussia, PA 19406

Purchaser   Autobytel Inc.     By:____________________________                                                                       Glenn E. Fuller, Executive Vice  President, Chief Legal and  Administrative Officer and  Secretary   Contact Name: Glenn E. Fuller   Contact Address: Autobytel Inc. 18872 MacArthur Blvd., Suite 200 Irvine, CA  92612-1400   Contact Telephone Number: 949.862.1392   Contact Facsimile Number: 949. 862.1323   Contact Email Address: ABTLLegal@autobytel.com   With copy to: Autobytel Inc. Legal Department 18872 MacArthur Blvd., Suite 200 Irvine, CA   92612-1400 Facsimile No.: 949.862.1323

(Signature Page to Indemnification, Noncompetition and Confidentiality Agreement)

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Disclosure Schedule

 

 

 

This Exhibit has been omitted in accordance with Item 601(b)(2) of Regulation S-K.  Autobytel Inc. will furnish supplementally a copy of any omitted schedule or exhibit to the Securities and Exchange Commission upon request; provided, however, that Autobytel Inc. may request confidential treatment pursuant to Rule 24b-2 of the Securities Exchange Act of 1934, as amended, for any schedule or exhibit so furnished.

 

 

 

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