\nARTICLE I THE MERGER…………………………………………………………………………………1
\n 1.1 The Merger………………………………………………………………….1
\n 1.2 Effective Time………………………………………………………………1
\n 1.3 Effect of the Merger…………………………………………………………2
\n 1.4 Articles of Incorporation and Bylaws; Directors and Officers……………………..2
\n 1.5 Effect on Capital Stock\/Merger Consideration……………………………………2
\n 1.6 Surrender of Certificates…………………………………………………….3
\n 1.7 Lost, Stolen or Destroyed Certificates…………………………………………5
\n 1.8 Dissenting Shares……………………………………………………………5
\n 1.9 Escrow……………………………………………………………………..5
\n 1.10 No Further Rights……………………………………………………………6
\n 1.11 Shareholder Representative……………………………………………………6
\n 1.12 Securities Laws Compliance……………………………………………………6
\n 1.13 The Closing…………………………………………………………………6
\n 1.14 Additional Action……………………………………………………………7<\/p>\nARTICLE II REPRESENTATIONS AND WARRANTIES OF NRI………………………………………………………..7
\n 2.1 Organization, Qualification and Corporate Power…………………………………7
\n 2.2 Capitalization………………………………………………………………7
\n 2.3 Authorization of Merger………………………………………………………8
\n 2.4 Noncontravention…………………………………………………………….9
\n 2.5 Subsidiaries………………………………………………………………..9
\n 2.6 Financial Statements…………………………………………………………9
\n 2.7 Absence of Certain Changes…………………………………………………..10
\n 2.8 Undisclosed Liabilities……………………………………………………..11
\n 2.9 Tax Matters………………………………………………………………..11
\n 2.10 Title to Assets…………………………………………………………….12
\n 2.11 Real Property………………………………………………………………12
\n 2.12 Intellectual Property……………………………………………………….13
\n 2.13 Contracts………………………………………………………………….14
\n 2.14 Accounts Receivable…………………………………………………………15
\n 2.15 Powers of Attorney………………………………………………………….15
\n 2.16 Insurance………………………………………………………………….16
\n 2.17 Litigation…………………………………………………………………16
\n 2.18 Warranties…………………………………………………………………16
\n 2.19 Employees………………………………………………………………….16
\n 2.20 Employee Benefits…………………………………………………………..17
\n 2.21 Environmental Matters……………………………………………………….19
\n 2.22 Legal Compliance……………………………………………………………20
\n 2.23 Customers and Suppliers……………………………………………………..20<\/p>\n
i<\/p>\n
2.24 Permits……………………………………………………………………20
\n 2.25 Certain Business Relationships With Affiliates…………………………………20
\n 2.26 Brokers’ Fees………………………………………………………………21
\n 2.27 Books and Records…………………………………………………………..21
\n 2.28 Disclosure…………………………………………………………………21<\/p>\n
ARTICLE III REPRESENTATIONS AND WARRANTIES OF PURCHASEPRO AND THE MERGER SUBSIDIARY………………………..21
\n 3.1 Organization, Qualification and Corporate Power………………………………..21
\n 3.2 Capitalization……………………………………………………………..21
\n 3.3 Validity of Shares………………………………………………………….22
\n 3.4 Authorization of Transaction…………………………………………………22
\n 3.5 Noncontravention……………………………………………………………22
\n 3.6 Reports and Financial Statements……………………………………………..22
\n 3.7 Litigation…………………………………………………………………23
\n 3.8 Interim Operations of the Merger Subsidiary……………………………………23
\n 3.9 Brokers’ Fees………………………………………………………………23
\n 3.10 Disclosure…………………………………………………………………23<\/p>\n
ARTICLE IV COVENANTS………………………………………………………………………………..23
\n 4.1 Closing Efforts…………………………………………………………….23
\n 4.2 Governmental and Third-Party Notices and Consents………………………………24
\n 4.3 Operation of Business……………………………………………………….24
\n 4.4 Access to Information……………………………………………………….25
\n 4.5 Notice of Breaches………………………………………………………….26
\n 4.6 Exclusivity………………………………………………………………..26
\n 4.7 Termination of Derivative Securities and Vesting of NRI Common Stock……………..26
\n 4.8 Approval of NRI Common Shareholders…………………………………………..26
\n 4.9 Approval by Principal Shareholder…………………………………………….27
\n 4.10 Cash as of the Closing Date………………………………………………….27
\n 4.11 NRI Employee Plans and Benefit Arrangements……………………………………27
\n 4.12 Tax-Free Reorganization……………………………………………………..27
\n 4.13 Customer Transition…………………………………………………………27
\n 4.14 NRI Contract Terminations……………………………………………………27<\/p>\n
ARTICLE V CONDITIONS TO CONSUMMATION OF MERGER…………………………………………………………28
\n 5.1 Conditions to Obligations of PurchasePro and the Merger Subsidiary……………….28
\n 5.2 Conditions to Obligations of NRI……………………………………………..29<\/p>\n
ARTICLE VI INDEMNIFICATION…………………………………………………………………………..30
\n 6.1 Indemnification by the Principal Shareholder…………………………………..30
\n 6.2 Indemnification by PurchasePro……………………………………………….31
\n 6.3 Indemnification Claims………………………………………………………31<\/p>\n
ii<\/p>\n
6.4 Survival of Representations and Warranties…………………………………….34
\n 6.5 Limitations………………………………………………………………..34<\/p>\n
ARTICLE VII TERMINATION……………………………………………………………………………..35
\n 7.1 Termination of Agreement…………………………………………………….35
\n 7.2 Effect of Termination……………………………………………………….36<\/p>\n
ARTICLE VIII DEFINITIONS…………………………………………………………………………….36
\n 8.1 Definitions………………………………………………………………..36<\/p>\n
ARTICLE IX MISCELLANEOUS…………………………………………………………………………….38
\n 9.1 Public Announcements………………………………………………………..38
\n 9.2 No Third Party Beneficiaries…………………………………………………38
\n 9.3 Entire Agreement……………………………………………………………38
\n 9.4 Succession and Assignment……………………………………………………38
\n 9.5 Counterparts and Facsimile Signature………………………………………….38
\n 9.6 Headings…………………………………………………………………..38
\n 9.7 Notices……………………………………………………………………39
\n 9.8 Governing Law………………………………………………………………39
\n 9.9 Amendments and Waivers………………………………………………………40
\n 9.10 Severability……………………………………………………………….40
\n 9.11 Submission to Jurisdiction…………………………………………………..40
\n 9.12 Standstill…………………………………………………………………40
\n 9.13 Construction……………………………………………………………….40
\n 9.14 Further Assurances………………………………………………………….41
\n 9.15 Confidentiality…………………………………………………………….41
\n 9.16 Expense……………………………………………………………………41<\/p>\n
iii
\n<\/c><\/s><\/caption>\n<\/table>\n
SCHEDULES AND EXHIBITS<\/p>\n
SCHEDULES<\/p>\n
Disclosure Schedule<\/p>\n
EXHIBITS<\/p>\n
EXHIBIT A Escrow Agreement
\nEXHIBIT B Shareholder Representative Agreement
\nEXHIBIT C Investment Representation Letter
\nEXHIBIT D Registration Rights Agreement
\nEXHIBIT E NRI Certificate
\nEXHIBIT F Opinion of Counsel to NRI
\nEXHIBIT G NRI Secretary Certificate
\nEXHIBIT H Employment Agreement
\nEXHIBIT I Shareholder Waiver Agreement
\nEXHIBIT J Employee Proprietary Information and Inventions Agreement
\nEXHIBIT K PurchasePro Certificate
\nEXHIBIT L PurchasePro Secretary Certificate
\nEXHIBIT M Opinion of Counsel to PurchasePro<\/p>\n
iv<\/p>\n
AGREEMENT AND PLAN OF REORGANIZATION<\/p>\n
THIS AGREEMENT AND PLAN OF REORGANIZATION dated as of March 5, 2001
\n(this “Agreement”) is entered into by and among PurchasePro.com, Inc., a Nevada
\ncorporation (“PurchasePro”), NRI Merger Corporation, a Florida corporation and
\nwholly-owned subsidiary of PurchasePro (the “Merger Subsidiary”), Net Research,
\nInc. (d\/b\/a BayBuilder), a Florida corporation (“NRI”), and Abu M. Rahman, the
\nmajority shareholder of NRI (the “Principal Shareholder”). PurchasePro, the
\nMerger Subsidiary, NRI and the Principal Shareholder are collectively referred
\nto herein as the “Parties.”<\/p>\n
RECITALS<\/p>\n
A. Upon the terms and subject to the conditions of this Agreement
\nand in accordance with the Florida Business Corporation Act (“FBCA”),
\nPurchasePro, the Merger Subsidiary and NRI will enter into a business
\ncombination transaction pursuant to which NRI will merge with and into the
\nMerger Subsidiary (the “Merger”).<\/p>\n
B. The Boards of Directors of each of PurchasePro, the Merger
\nSubsidiary and NRI (i) have each determined that the Merger is consistent with
\nand in furtherance of the long-term business strategy of their respective
\ncompanies and fair to, and in the best interest of, their respective companies
\nand stockholders and (ii) have each approved this Agreement, the Merger and the
\nother transactions contemplated by this Agreement.<\/p>\n
C. For federal income tax purposes, the Parties intend that (i)
\nthe Merger qualify as a reorganization within the meaning of Section 368 of the
\nInternal Revenue Code of 1986, as amended (the “Code”), and (ii) this Agreement
\nbe and is adopted as a plan of reorganization within the meaning of Section 368
\nof the Code.<\/p>\n
D. PurchasePro, the Merger Subsidiary and NRI desire to make
\ncertain representations and warranties and other agreements in connection with
\nthe Merger.<\/p>\n
NOW, THEREFORE, in consideration of the representations, warranties and
\ncovenants herein contained, and for other good and valuable consideration, the
\nreceipt and sufficiency of which are hereby acknowledged, the Parties agree as
\nfollows.<\/p>\n
ARTICLE I.
\n THE MERGER<\/p>\n
1.1 THE MERGER. Upon and subject to the terms and conditions of this
\nAgreement and the applicable provisions of the FBCA, NRI shall merge with and
\ninto the Merger Subsidiary at the Effective Time (as defined in SECTION 1.2
\nbelow). From and after the Effective Time, the separate corporate existence of
\nNRI shall cease and the Merger Subsidiary shall continue as the surviving
\ncorporation in the Merger (the “Surviving Corporation”).<\/p>\n
1.2 EFFECTIVE TIME. Subject to the provisions of this Agreement, the
\nparties hereto shall cause the Merger to be consummated by filing the Articles
\nof Merger (the “Articles of Merger”) with the Florida Department of State in
\naccordance with the relevant provisions of the <\/p>\n
FBCA (the time of such filing (or such later time as may be agreed in writing
\nby the Parties and specified in the Articles of Merger) being the “Effective
\nTime”) as soon as practicable on the Closing Date (as defined in SECTION 1.13
\nbelow). Unless the context otherwise requires, the term “Agreement” as used
\nherein refers collectively to this Agreement and the Articles of Merger.<\/p>\n
1.3 EFFECT OF THE MERGER. At the Effective Time, the effect of the
\nMerger shall be as provided in this Agreement and the applicable provisions of
\nthe FBCA. Without limiting the generality of the foregoing, and subject thereto,
\nat the Effective Time all the property, rights, privileges, powers and
\nfranchises of NRI and the Merger Subsidiary shall vest in the Surviving
\nCorporation, and all debts, liabilities and duties of NRI and the Merger
\nSubsidiary shall become the debts liabilities and duties of the Surviving
\nCorporation.<\/p>\n
1.4 ARTICLES OF INCORPORATION AND BYLAWS; DIRECTORS AND OFFICERS.<\/p>\n
(a) At the Effective Time, the Articles of Incorporation of
\nthe Merger Subsidiary, as in effect immediately prior to the Effective Time,
\nshall be the Articles of Incorporation of the Surviving Corporation, except that
\nArticle I thereof shall be amended to read in its entirety as follows: “The name
\nof the corporation is “Net Research, Inc.”<\/p>\n
(b) At the Effective Time, the Bylaws of the Merger
\nSubsidiary, as in effect immediately prior to the Effective Time, shall be the
\nBylaws of the Surviving Corporation until thereafter amended as provided by law,
\nexcept that the Bylaws shall be amended to reflect that the name of the
\nSurviving Corporation shall be “Net Research, Inc.”<\/p>\n
(c) At the Effective Time, the directors of the Merger
\nSubsidiary immediately prior to the Effective Time shall become the directors,
\nand the officers of the Merger Subsidiary immediately prior to the Effective
\nTime shall become the officers, of the Surviving Corporation, each to hold
\noffice from the Effective Time until their respective successors are duly
\nelected or appointed and qualified in the manner provided in the Articles of
\nIncorporation and Bylaws of the Surviving Corporation and applicable law.<\/p>\n
1.5 EFFECT ON CAPITAL STOCK\/MERGER CONSIDERATION. At the Effective
\nTime, by virtue of the Merger and without any action on the part of any Party or
\nthe holders of any of the following securities:<\/p>\n
(a) CONVERSION OF NRI COMMON STOCK. Subject to the provisions
\nof SECTION 1.8 below, each share of Common Stock, par value $0.001 per share, of
\nNRI (the “NRI Common Stock”) issued and outstanding immediately prior to the
\nEffective Time (other than any share held in NRI’s treasury) (the “Outstanding
\nNRI Common Stock”) shall be canceled and extinguished and automatically
\nconverted into and represent the right to receive (i) a pro rata portion of
\nThree Million Dollars ($3,000,000) (the “Cash Consideration”) less the Escrow
\nCash (as defined in SECTION 1.9 below), and (ii) that number of shares of Common
\nStock, par value $0.01 per share, of PurchasePro (“PurchasePro Common Stock”)
\nequal to the Exchange Ratio (as defined below) less the Escrow Shares (as
\ndefined in SECTION 1.9 below), upon the surrender of the certificates
\nrepresenting such shares of NRI Common Stock in the manner provided in SECTION
\n1.6 below (or in the case of a lost, stolen or destroyed certificate, in the
\nmanner provided in SECTION 1.7 below). The “Exchange Ratio” means the quotient
\nobtained by dividing (x) the <\/p>\n
2<\/p>\n
quotient obtained by dividing Twelve Million Dollars ($12,000,000) by the
\nOutstanding NRI Common Stock by (y) the average of the closing prices per
\nshare of PurchasePro Common Stock as quoted on the Nasdaq National Market and
\nreported in The Wall Street Journal for the five (5) trading days immediately
\npreceding (but not including) the Closing Date (the “Closing Share Price”).<\/p>\n
(b) CANCELLATION OF CERTAIN SHARES. Each share of NRI Common
\nStock held in NRI’s treasury immediately prior to the Effective Time shall be
\ncanceled and retired without payment of any consideration therefor.<\/p>\n
(c) DERIVATIVE SECURITIES AND VESTING NRI COMMON STOCK. As of
\nthe Effective Time, all options, warrants, notes, evidence of indebtedness,
\nstock and other security that entitles the holder thereof the right to convert,
\npurchase or otherwise acquire any NRI capital stock or any other security
\nconvertible into NRI capital stock (collectively, the “Derivative Securities”)
\nshall not be assumed by PurchasePro and shall all have been either converted
\ninto NRI Common Stock or terminated. All of the NRI Common Stock subject to
\nvesting shall have fully vested or such vesting rights shall have been
\nterminated prior to the Closing pursuant to the terms of the agreements
\nproviding for such vesting.<\/p>\n
(d) CAPITAL STOCK OF THE MERGER SUBSIDIARY. Each share of
\ncommon stock, $.01 par value per share, of the Merger Subsidiary issued and
\noutstanding immediately prior to the Effective Time shall be converted into and
\nthereafter evidence one share of common stock, $.01 par value per share, of the
\nSurviving Corporation.<\/p>\n
(e) ADJUSTMENT TO THE EXCHANGE RATIO. The Exchange Ratio shall
\nbe subject to equitable adjustment in the event of any stock split, stock
\ndividend, reverse stock split, reorganization, merger or similar event affecting
\nPurchasePro Common Stock between the date hereof and the Effective Time. The
\nshares of PurchasePro Common Stock into which NRI Common Stock is converted
\npursuant to this SECTION 1.5 are collectively referred to herein as the “Merger
\nShares.”<\/p>\n
(f) FRACTIONAL SHARES. No certificates or scrip representing
\nfractional Merger Shares shall be issued to former holders of NRI Common Stock
\nupon the surrender for exchange of certificates that, immediately prior to the
\nEffective Time, represented NRI Common Stock converted into Merger Shares
\npursuant to SECTION 1.5(a) (“Certificates”), and such former holders of NRI
\nCommon Stock shall not be entitled to any voting rights, rights to receive any
\ndividends or distributions or other rights as a stockholder of PurchasePro with
\nrespect to any fractional Merger Shares that would have otherwise been issued to
\nsuch former holders of NRI Common Stock. In lieu of any fractional Merger Shares
\nthat would have otherwise been issued, each former holder of NRI Common Stock
\nthat would have been entitled to receive a fractional Merger Share shall, upon
\nproper surrender of such person’s Certificate, receive cash equal to the product
\nof (i) the applicable fraction multiplied by (ii) the Closing Share Price.<\/p>\n
1.6 SURRENDER OF CERTIFICATES.<\/p>\n
(a) EXCHANGE AGENT. PurchasePro’s transfer agent shall act as
\nthe exchange agent (the “Exchange Agent”) in the Merger.<\/p>\n
3<\/p>\n
(b) PURCHASEPRO TO PROVIDE COMMON STOCK. Immediately after the
\nEffective Time, PurchasePro shall deliver to the Exchange Agent for exchange the
\nMerger Shares (less the Escrow Shares) issuable pursuant to SECTION 1.5 in
\nexchange for shares of Outstanding NRI Common Stock, the Cash Consideration
\n(less the Escrow Cash) and cash in an amount sufficient for payment in lieu of
\nfractional shares pursuant to SECTION 1.5.<\/p>\n
(c) EXCHANGE PROCEDURES. Immediately after the Effective Time,
\nthe Surviving Corporation shall cause to be mailed to each holder of record of
\noutstanding shares of NRI Common Stock whose shares were converted into the
\nright to receive the Merger Shares and the Cash Consideration pursuant to
\nSECTION 1.5(a), (i) a letter of transmittal and (ii) instructions for use in
\neffecting the surrender of the Certificates in exchange for certificates
\nrepresenting shares of Merger Shares (less the Escrow Shares) and Cash
\nConsideration (less the Escrow Cash). Upon surrender of a Certificate for
\ncancellation to the Exchange Agent, together with such letter of transmittal,
\nduly completed and validly executed in accordance with the instructions thereto,
\nthe holder of such Certificate shall be entitled to receive in exchange therefor
\nand PurchasePro shall promptly cause to be issued, a certificate representing
\nthe number of whole shares of Merger Shares (less the Escrow Shares), cash
\npayment in lieu of fractional shares which such holder has the right to receive
\npursuant to SECTION 1.5, and such holder’s pro rata portion of the Cash
\nConsideration (less the Escrow Cash), and the Certificate so surrendered shall
\nforthwith be canceled. Until so surrendered, each outstanding Certificate that,
\nprior to the Effective Time, represented shares of NRI Common Stock will be
\ndeemed from and after the Effective Time, for all corporate purposes, other than
\nthe payment of dividends, to evidence the ownership of the number of full shares
\nof Merger Shares (less the Escrow Shares), the pro rata portion of the Cash
\nConsideration (less the Escrow Cash) into which such shares of PurchasePro
\nCommon Stock shall have been so converted and the right to receive an amount in
\ncash in lieu of the issuance of any fractional shares in accordance with SECTION
\n1.5.<\/p>\n
(d) DISTRIBUTIONS WITH RESPECT TO UNEXCHANGED SHARES. No
\ndividends or other distributions declared or made after the date of this
\nAgreement with respect to Merger Shares with a record date after the Effective
\nTime will be paid to the holder of any unsurrendered Certificate with respect to
\nthe shares of Merger Shares represented thereby until the holder of record of
\nsuch Certificate shall surrender such Certificate. After the surrender of a
\nCertificate in accordance with this Section, the record holder thereof shall be
\nentitled to receive any such dividends or other distributions, without interest
\nthereon, which theretofore had become payable with respect to the Merger Shares.
\nSubject to applicable law, following surrender of any such Certificate, there
\nshall be paid to the record holder of the certificates representing whole shares
\nof Merger Shares issued in exchange therefor, without interest, at the time of
\nsuch surrender, the amount of dividends or other distributions with a record
\ndate after the Effective Time payable with respect to such whole shares of
\nMerger Shares.<\/p>\n
(e) TRANSFERS OF OWNERSHIP. If any certificate for shares of
\nMerger Shares and any portion of the Cash Consideration are to be issued in a
\nname other than that in which the certificate surrendered in exchange therefor
\nis registered, it will be a condition of the issuance thereof that the
\ncertificate so surrendered will be properly endorsed and otherwise in proper
\nform for transfer and that the person requesting such exchange will have paid to
\nPurchasePro or any agent designated by it any transfer or other taxes required
\nby reason of the issuance of a certificate for shares of Merger Shares in any
\nname other than that of the registered holder of the <\/p>\n
4<\/p>\n
certificate surrendered, or established to the satisfaction of PurchasePro or
\nany agent designated by it that such tax has been paid or is not payable.<\/p>\n
(f) NO LIABILITY. Notwithstanding anything to the contrary in
\nthis SECTION 1.6, none of the Exchange Agent, the Surviving Corporation or any
\nparty hereto shall be liable to a holder of shares of Merger Shares or NRI
\nCommon Stock for any amount properly paid to a public official pursuant to any
\napplicable abandoned property, escheat or similar law.<\/p>\n
1.7 LOST, STOLEN OR DESTROYED CERTIFICATES. In the event any
\nCertificates shall have been lost, stolen or destroyed, the Exchange Agent shall
\nissue in exchange for such lost, stolen or destroyed Certificates, upon the
\nmaking of an affidavit of that fact by the holder thereof, such shares of Merger
\nShares (less the Escrow Shares), such pro rata amount of the Cash Consideration
\n(less the Escrow Cash) and cash for fractional shares, if any, as may be
\nrequired pursuant to SECTION 1.5; PROVIDED, HOWEVER, that PurchasePro may, in
\nits discretion and as a condition precedent to the issuance thereof, require the
\nowner of such lost, stolen or destroyed Certificates to deliver a bond in such
\nsum as it may reasonably direct as indemnity against any claim that may be made
\nagainst PurchasePro or the Exchange Agent with respect to the Certificates
\nalleged to have been lost, stolen or destroyed.<\/p>\n
1.8 DISSENTING SHARES.<\/p>\n
(a) Notwithstanding any provision of this Agreement to the
\ncontrary, the shares of any holder of NRI Common Stock who has demanded and
\nperfected appraisal rights for such shares in accordance with the of the FBCA
\nand who, as of the Effective Time, has not effectively withdrawn or lost such
\nappraisal rights (“Dissenting Shares”), shall not be converted into or represent
\na right to receive PurchasePro Common Stock pursuant to SECTION 1.5, but the
\nholder thereof shall only be entitled to such rights as are granted by the of
\nthe FBCA.<\/p>\n
(b) Notwithstanding the provisions of Subsection (a) above, if
\nany holder of shares of NRI Common Stock who demands appraisal of such shares
\nunder the FBCA shall effectively withdraw the right to appraisal, then, as of
\nthe later of the Effective Time or the occurrence of such event, such holder’s
\nshares shall automatically be converted into and represent only the right to
\nreceive Merger Shares and Cash Consideration, without interest thereon, upon
\nsurrender of the certificate representing such shares.<\/p>\n
(c) NRI shall give PurchasePro (i) prompt notice of any
\nwritten demands for appraisal of any shares of NRI Common Stock, withdrawals of
\nsuch demands, and any other instruments served pursuant to the FBCA and received
\nby NRI which relate to any such demand for appraisal and (ii) the opportunity to
\nparticipate in all negotiations and proceedings which take place prior to the
\nEffective Time with respect to demands for appraisal under the FBCA. NRI shall
\nnot, except with the prior written consent of PurchasePro, voluntarily make any
\npayment with respect to any demands for appraisal of NRI Common Stock or offer
\nto settle or settle any such demands.<\/p>\n
1.9 ESCROW. On the Closing Date, PurchasePro shall deliver to the
\nEscrow Agent: (i) Five Hundred Thousand Dollars ($500,000) of the Cash
\nConsideration (the “Escrow Cash”) and (ii) that number of shares of PurchasePro
\nCommon Stock equal to One Million Dollars <\/p>\n
5<\/p>\n
($1,000,000), based on the Closing Share Price (the “Escrow Shares” and
\ntogether with the Escrow Cash, the “Escrow Fund”) for the purpose of securing
\nthe indemnification obligations of the NRI Common Shareholders (as defined
\nhereinafter) set forth in this Agreement. The Escrow Cash and the Escrow
\nShares shall be held by the Escrow Agent pursuant to the terms of the
\nIndemnity Escrow Agreement substantially in the form of EXHIBIT A attached
\nhereto (the “Escrow Agreement”) by and among PurchasePro, the Escrow Agent
\nand the Shareholder Representative (as defined in SECTION 1.11 below).<\/p>\n
1.10 NO FURTHER RIGHTS. Immediately after the Effective Time, no NRI
\nCommon Stock shall be deemed to be outstanding, except as otherwise contemplated
\nby , and holders of Certificates shall cease to have any rights with respect
\nthereto, except as provided herein or by law.<\/p>\n
1.11 SHAREHOLDER REPRESENTATIVE. By their approval of the Merger, each
\nof the NRI Shareholders will be conclusively deemed to have consented to,
\napproved and agreed to be personally bound by: (i) the indemnification
\nprovisions of ARTICLE VI; (ii) the Escrow Agreement; (iii) the appointment of
\nthe Principal Shareholder as the representative of the NRI Common Shareholders,
\n(the “Shareholder Representative”) and as the attorney-in-fact and agent for and
\non behalf of each NRI Common Shareholder as provided in this Agreement, the
\nEscrow Agreement and the Shareholder Representative Agreement in the form
\nattached hereto as EXHIBIT B (the “Representative Agreement”) and (iv) the
\ntaking by the Shareholder Representative of any and all actions and the making
\nof any decisions required or permitted to be taken by the Shareholder
\nRepresentative under this Agreement and under the Escrow Agreement. The
\nShareholder Representative will have authority and power to act on behalf of
\neach NRI Common Shareholder with respect to the disposition, settlement or other
\nhandling of (a) indemnity claims under ARTICLE VI, (b) all claims governed by
\nthe Escrow Agreement, and all rights or obligations arising under the Escrow
\nAgreement and (c) such other matters as provided in the Representative
\nAgreement. Each NRI Common Shareholder will be bound by all actions taken by the
\nShareholder Representative in connection with indemnity claims under ARTICLE VI
\nand the Escrow Agreement, and PurchasePro will be entitled to rely on any action
\nor decision of the Shareholder Representative in connection therewith.<\/p>\n
1.12 SECURITIES LAWS COMPLIANCE. PurchasePro will issue the shares of
\nPurchasePro Common Stock to be issued in the Merger pursuant to SECTION 1.5 of
\nthis Agreement pursuant to the exemption(s) from registration under Section 4(2)
\nand\/or Regulation D promulgated under the Securities Act of 1933, as amended
\n(the “Securities Act”) and applicable exemptions under applicable state
\nsecurities laws. Concurrently with execution of this Agreement, each NRI Common
\nShareholder shall execute and deliver to PurchasePro an Investment
\nRepresentation Letter in the form of EXHIBIT C attached hereto (the “Investment
\nRepresentation Letter”), which shall, among other things, evidence such NRI
\nCommon Shareholder’s understanding and acknowledgement that the shares of
\nPurchasePro Common Stock to be issued to NRI Common Shareholders pursuant to
\nSECTION 1.5 will be “restricted securities” within the meaning of Rule 144 under
\nthe 1933 Act.<\/p>\n
1.13 THE CLOSING. The closing of the transactions contemplated by this
\nAgreement (the “Closing”) shall take place at the offices of Brobeck, Phleger & Harrison LLP in San Diego, California commencing at 9 A.M. on the date that is
\nfive (5) business days after all <\/p>\n
6<\/p>\n
the obligations set forth in ARTICLE V are complied with or have been waived,
\nor at such time and in such manner as the Parties mutually agree (the
\n“Closing Date”).<\/p>\n
1.14 ADDITIONAL ACTION. The Surviving Corporation may, at any time
\nafter the Effective Time, take any action, including executing and delivering
\nany document, in the name and on behalf of either NRI or the Merger Subsidiary,
\nin order to consummate the transactions contemplated by this Agreement.<\/p>\n
ARTICLE II.
\n REPRESENTATIONS AND WARRANTIES OF NRI<\/p>\n
NRI represents and warrants to PurchasePro as of the date hereof and as
\nof the Closing Date, except as set forth in the disclosure schedule attached
\nhereto (the “Disclosure Schedule”) furnished to PurchasePro specifically
\nidentifying the relevant subparagraph hereof, which exceptions shall be deemed
\nto be representations and warranties as if made hereunder, as follows:<\/p>\n
2.1 ORGANIZATION, QUALIFICATION AND CORPORATE POWER. NRI is a
\ncorporation duly organized, validly existing and in corporate and tax good
\nstanding under the laws of Florida. NRI is duly qualified to conduct business
\nand is in corporate and tax good standing under the laws of each jurisdiction in
\nwhich the nature of its business or the ownership or leasing of its properties
\nrequires such qualification, except where the failure to be so qualified or in
\ngood standing, individually or in the aggregate, has not had and would not
\nreasonably be expected to have a NRI MAE (as defined below). NRI has all
\nrequisite corporate power and authority to carry on the business in which it is
\nengaged and to own and use the properties owned and used by it. NRI has
\nfurnished to PurchasePro complete and accurate copies of its Articles of
\nIncorporation and Bylaws. NRI is not in default under or in violation of any
\nprovision of its Articles of Incorporation or Bylaws. For purposes of this
\nAgreement, “NRI MAE” means a material adverse effect on the assets, business,
\ncondition (financial or otherwise), results of operations or future prospects of
\nNRI, but shall not include any of the foregoing related to (i) the economy or
\nfinancial markets in general, or (ii) the industries in general in which NRI
\noperates and not specifically related to (or having the effect of specifically
\nrelating to or having a materially disproportionate effect (relative to most
\nother industry participants) on) NRI.<\/p>\n
2.2 CAPITALIZATION. The authorized capital stock of NRI consists of
\n7,500,000 shares of NRI common stock, par value $.001, of which, as of the date
\nof this Agreement, 7,500,000 shares were issued and outstanding and no shares
\nare held in the treasury of NRI. NRI has no shares of preferred stock authorized
\nor issued. The NRI Common Shareholders (as defined below) own all the shares of
\nNRI Common Stock as of the date of this Agreement. SECTION 2.2 of the Disclosure
\nSchedule sets forth a complete and accurate list specifying (i) all of the
\nholders of NRI capital stock (the “NRI Common Shareholders”) and the number of
\nshares of NRI Common Stock held by each NRI Common Shareholder, (ii) all
\noutstanding Derivative Securities indicating (A) the holder thereof, (B) the
\nnumber of shares of NRI Common Stock subject thereto, (C) the exercise price,
\ndate of grant, vesting schedule and expiration date therefor, and (D) any terms
\nregarding the acceleration of vesting thereof, and (iii) all stock option plans
\nand other stock or equity-related plans of NRI. All of the issued and
\noutstanding shares of NRI Common Stock are, and all shares of NRI Common Stock
\nthat may be issued upon exercise <\/p>\n
7<\/p>\n
of Derivative Securities will be duly authorized, validly issued, fully paid,
\nnonassessable and free of all preemptive rights. Other than the Derivative
\nSecurities listed in SECTION 2.2 of the Disclosure Schedule, there are no
\noutstanding or authorized options, warrants, rights, other convertible
\nsecurities or instruments, agreements or commitments to which NRI is a party
\nor that are binding upon NRI providing for the issuance or redemption of any
\nof its capital stock. All of the Derivative Securities listed in SECTION 2.2
\nof the Schedule shall be converted into NRI common stock or terminated prior
\nto Closing and all preferred stock of NRI shall be converted into common
\nstock of NRI prior to the Closing. There are no outstanding or authorized
\nstock appreciation, phantom stock or similar rights with respect to NRI. All
\nof the NRI Common Stock subject to vesting shall have fully vested or such
\nvesting rights shall have been terminated prior to the Closing pursuant to
\nthe terms of the agreements providing for such vesting. There are no
\nagreements to which NRI is a party or by which it is bound with respect to
\nthe voting (including voting trusts or proxies), registration under the
\nSecurities Act, or sale or transfer (including agreements relating to
\npre-emptive rights, rights of first refusal, co-sale rights or “drag-along”
\nrights) of any securities of NRI. To the “Knowledge of NRI,” there are no
\nagreements among other parties, to which NRI is not a party and by which it
\nis not bound, with respect to the voting (including voting trusts or proxies)
\nor sale or transfer (including agreements relating to rights of first
\nrefusal, co-sale rights or “drag-along” rights) of any securities of NRI. All
\nof the issued and outstanding shares of NRI Common Stock were issued in
\ncompliance with applicable federal and state securities laws. For purposes of
\nthis ARTICLE II, the “Knowledge of NRI” or any phrase of similar import shall
\nbe deemed to refer to the knowledge of any executive officers or director of
\nNRI after reasonable inquiry and investigation by such executive officer or
\ndirector with respect to the matter in question.<\/p>\n
2.3 AUTHORIZATION OF MERGER. NRI has all requisite power and authority
\nto execute and deliver this Agreement and to perform its obligations hereunder.
\nThe Principal Shareholder has all requisite power and authority to execute and
\ndeliver this Agreement and to perform his obligations hereunder. The execution
\nand delivery by NRI of this Agreement and the consummation by NRI of the
\ntransactions contemplated hereby have been duly and validly authorized by all
\nnecessary corporate action on the part of NRI. Without limiting the generality
\nof the foregoing:<\/p>\n
(a) the Board of Directors of NRI, at a meeting duly called
\nand held or by written consent, unanimously (i) determined that the Merger is
\nfair and in the best interests of NRI and its shareholders, (ii) adopted this
\nAgreement in accordance with the provisions of the FBCA and (iii) directed that
\nthis Agreement and the Merger be submitted to the shareholders of NRI, for their
\nadoption and approval and resolved to recommend that the shareholders of NRI,
\nvote in favor of the adoption of this Agreement and the approval of the Merger;<\/p>\n
(b) this Agreement has been duly and validly executed and
\ndelivered by NRI and constitutes a valid and binding obligation of NRI,
\nenforceable against NRI in accordance with its terms; and<\/p>\n
(c) the affirmative vote of the holders of: (a) more than
\nfifty percent (50%) of the shares of NRI Common Stock that are issued and
\noutstanding on the Record Date (as defined below) is the only vote of the
\nholders of any of the shares of NRI’s capital stock, that is necessary to
\napprove this Agreement, the Merger, the Articles of Merger, the Escrow Agreement<\/p>\n
8<\/p>\n
and the other transactions contemplated by this Agreement under applicable law,
\nNRI’s Articles of Incorporation, Bylaws and other charter documents, and under
\nany agreement or contract regarding the voting of shares of NRI’s capital stock.
\nAs used in this SECTION 2.3, the term “Record Date” means the record date for
\ndetermining those shareholders of NRI who are entitled to vote.<\/p>\n
2.4 NONCONTRAVENTION. Except for (i) the filing of the Articles of
\nMerger as required by the FBCA and (ii) the third party consents required and
\nset forth in SECTION 2.4 of the Disclosure Schedule, neither the execution and
\ndelivery by NRI of this Agreement nor the consummation by NRI of the
\ntransactions contemplated hereby will:<\/p>\n
(a) conflict with or violate any provision of the Articles of
\nIncorporation or Bylaws of NRI;<\/p>\n
(b) require on the part of NRI any filing with, or any permit,
\nauthorization, consent or approval of, any court, arbitrational tribunal,
\nadministrative agency or commission or other governmental or regulatory
\nauthority or agency (a “Governmental Entity”);<\/p>\n
(c) conflict with, result in a breach of, constitute (with or
\nwithout due notice or lapse of time or both) a default under, result in the
\nacceleration of obligations under, create in any party the right to terminate,
\nmodify or cancel, or require any notice, consent or waiver under, any contract
\nor instrument to which NRI is a party or by which NRI is bound or to which any
\nof its assets is subject;<\/p>\n
(d) result in the imposition of any Security Interest (as
\ndefined below) upon any assets of NRI;<\/p>\n
(e) violate any order, writ, injunction or decree applicable
\nto NRI or any of its properties or assets; or<\/p>\n
(f) violate any statute, rule or regulation applicable to NRI
\nor any of its properties or assets which violation would have a NRI MAE.<\/p>\n
For purposes of this Agreement, (i) “Security Interest” means any
\nmortgage, pledge, security interest, encumbrance, charge or other lien (whether
\narising by contract or by operation of law), other than (A) mechanic’s,
\nmaterialmen’s, and similar liens, (B) liens arising under worker’s compensation,
\nunemployment insurance, social security, retirement, and similar legislation,
\nand (C) liens on goods in transit incurred pursuant to documentary letters of
\ncredit, in each case arising in the Ordinary Course of Business (as defined
\nbelow) of NRI and not material to NRI and (ii) “Ordinary Course of Business”
\nmeans the ordinary course of NRI’s business consistent with past custom and
\npractice (including with respect to frequency and amount).<\/p>\n
2.5 SUBSIDIARIES. NRI does not control directly or indirectly or have
\nany direct or indirect equity participation or similar interest in any
\ncorporation, partnership, limited liability company, joint venture, trust or
\nother business association.<\/p>\n
2.6 FINANCIAL STATEMENTS. NRI has provided to PurchasePro its balance
\nsheets and statements of income, changes in shareholders’ equity and cash flows
\nsince inception. Such <\/p>\n
9<\/p>\n
financial statements (collectively, the “Financial Statements”) (i) have been
\nprepared using Quickbook accounting software and have been prepared on a
\nconsistent basis throughout the periods covered thereby, (ii) fairly present
\nthe financial condition, results of operations and cash flows of NRI as of
\nthe dates thereof and for the periods referred to therein, (iii) are
\nconsistent with the books and records of NRI and (iv) are true, correct and
\ncomplete in all material respects.<\/p>\n
2.7 ABSENCE OF CERTAIN CHANGES. Since December 31, 2000, (a) there has
\noccurred no event or development that has had, or could reasonably be expected
\nto have in the future, a NRI MAE, and (b) NRI has not:<\/p>\n
(a) issued any stock, bonds or other corporate securities or
\nany right, options or warrants with respect thereto;<\/p>\n
(b) borrowed any amount, obtained any letters of credit or
\nincurred or become subject to any liabilities in excess of Twenty Thousand
\nDollars ($20,000) in the aggregate;<\/p>\n
(c) discharged or satisfied any Security Interest or other
\nencumbrance or paid any obligation or liability, other than current liabilities
\npaid in the Ordinary Course of Business and other than current federal income
\nTax liabilities;<\/p>\n
(d) declared or made any payment or distribution of cash or
\nother property to shareholders with respect to its stock, or purchased or
\nredeemed any shares of its capital stock;<\/p>\n
(e) mortgaged or pledged any of its assets or properties, or
\nsubjected them to any Security Interest or any other encumbrance;<\/p>\n
(f) sold, leased, subleased, assigned or transferred any of
\nits assets or properties, except in the Ordinary Course of Business, or
\ncancelled any debts or claims; (g) made any changes in any employee
\ncompensation, severance or termination agreement, commitment or transaction
\nother than routine salary increases consistent with past practice or offer
\nemployment to any individuals;<\/p>\n
(h) entered into any material transaction, or modified any
\nexisting transaction (the aggregate consideration for which is in excess of
\nTwenty Thousand Dollars ($20,000));<\/p>\n
(i) made any capital expenditures, additions or improvements
\nor commitments for the same, except those made in the Ordinary Course of
\nBusiness which in the aggregate do not exceed Twenty Thousand Dollars ($20,000);<\/p>\n
(j) entered into any transaction or operated NRI’s business,
\nnot in the Ordinary Course of Business;<\/p>\n
(k) made any change in its accounting methods or practices or
\nceased making accruals for Taxes, obsolete inventory, vacation and other
\ncustomary accruals;<\/p>\n
(l) ceased from reserving cash to pay Taxes, principal and
\ninterest on borrowed funds, and other customary expenses and payments;<\/p>\n
10<\/p>\n
(m) caused to be entered into any amendment or termination of
\nany lease, customer or supplier contract or other material contract or agreement
\nto which it is a party, other than in the Ordinary Course of Business;<\/p>\n
(n) made any material change in any of its business policies;<\/p>\n
(o) terminated or failed to renew, or received any written
\nthreat (that was not subsequently withdrawn) to terminate or fail to renew, any
\ncontract or other agreement that is or was material to NRI’s business or its
\nfinancial condition; or<\/p>\n
(p) entered into any agreement to do any of the foregoing.<\/p>\n
2.8 UNDISCLOSED LIABILITIES. NRI does not have any liability (whether
\nknown or unknown, whether absolute or contingent, whether liquidated or
\nunliquidated, and whether due or to become due), except for (a) liabilities that
\nhave arisen since December 31, 2000 in the Ordinary Course of Business, (b)
\ncontractual and other liabilities incurred in the Ordinary Course of Business
\nthat are not required by GAAP to be reflected on a balance sheet, (c)
\nliabilities reflected in the Financial Statements, or (d) liabilities for fees
\nand costs of NRI related to the Merger.<\/p>\n
2.9 TAX MATTERS.<\/p>\n
(a) For purposes of this Agreement, the following terms shall
\nhave the following meanings:<\/p>\n
(i) “Taxes” means (A) all taxes, charges, fees, levies or
\n other similar assessments or liabilities, including
\n net income, gross income, gross receipts, ad valorem,
\n premium, value-added, excise, real property, personal
\n property, sales, use, transfer, withholding,
\n employment, unemployment insurance, social security,
\n business license, business organization,
\n environmental, workers compensation, payroll,
\n profits, license, lease, service, service use,
\n severance, stamp, occupation, windfall profits,
\n customs, duties, franchise and other taxes imposed by
\n the United States of America or any state, local or
\n foreign government, or any agency thereof, or other
\n political subdivision of the United States or any
\n such government, and any interest, fines, penalties,
\n assessments or additions to tax resulting from,
\n attributable to or incurred in connection with any
\n tax or any contest or dispute thereof, (B) any
\n liability for the payment of any amounts of the type
\n described in (A) as a result of being a member of an
\n affiliated, consolidated, combined or unitary group
\n for any taxable period and (C) any liability for the
\n payment of any amount of the type described in (A) or
\n (B) as a result of any express or implied obligation
\n to indemnify any other person.<\/p>\n
(ii) “Tax Returns” means all reports, returns,
\n declarations, statements or other information
\n (including, without limitation, estimated Tax <\/p>\n
11<\/p>\n
Returns and reports, withholding Tax Returns and
\n reports and information reports and returns)
\n required to be supplied to a taxing authority in
\n connection with Taxes.<\/p>\n
(b) NRI has qualified and continued to so qualify as a S
\nCorporation for federal and state tax purposes since the date of its
\nincorporation and will continue to so qualify up to and including the Closing
\nDate. NRI has or will have filed with the appropriate federal, state, local and
\nforeign taxing authorities all Tax Returns required to be filed by or with
\nrespect to it on or before the Closing Date, and such Tax Returns are or will be
\ntrue, correct and complete in all material respects. NRI has paid in full or has
\nmade provision in the Financial Statements for all taxes which are due or
\nclaimed to be due from it by any taxing authority. The reserves for Taxes
\nreflected in the Financial Statements are sufficient for payment in full of all
\nunpaid Taxes (whether or not currently known or disputed) through the date
\nthereof. NRI has not incurred any liability for Taxes other than in the Ordinary
\nCourse of Business since December 31, 2000. There are no liens for Taxes upon
\nthe assets of NRI. NRI has not received any notice of deficiency or assessment
\nfrom any federal, state, local or foreign taxing authorities with respect to
\nliabilities for Taxes which have not been fully paid or finally settled. No
\nstate of facts exists or has existed which would constitute grounds for the
\nassessment of any liability for Taxes with respect to the periods prior to the
\nClosing Date which have not been audited by any taxing authority. Neither NRI,
\nits officers or directors nor shareholders are aware of any information which
\nhas caused or should cause them to believe that an audit by any Tax authority
\nmay be forthcoming. NRI has withheld and paid all Taxes required to have been
\nwithheld and paid in connection with amounts paid or owing to any employee,
\nindependent contractor, creditor, shareholder, or other third party.<\/p>\n
2.10 TITLE TO ASSETS. NRI has good and valid title to, or valid
\nleasehold interest in, all tangible assets and properties, real, personal and
\nmixed, used or held for use in NRI’s business as presently conducted and as
\npresently proposed to be conducted. Each such tangible asset is free from
\nmaterial defects, has been maintained in accordance with normal industry
\npractice, is in good operating condition and repair (subject to normal wear and
\ntear) and is suitable for the purposes for which it presently is used. No asset
\nof NRI (tangible or intangible) is subject to any Security Interest or any other
\nencumbrances.<\/p>\n
2.11 REAL PROPERTY. NRI does not own, and has never owned, any real
\nproperty. SECTION 2.11 of the Disclosure Schedule lists the only real property
\nleased by or subleased to NRI ( the “Leased Property”). NRI has delivered to
\nPurchasePro a complete and accurate copy of the lease (the “RP Lease”) for the
\nLeased Property. The RP Lease is legal, valid, binding, enforceable and in full
\nforce and effect and will continue to be legal, valid, binding, enforceable and
\nin full force and effect immediately following the Closing in accordance with
\nthe terms thereof as in effect immediately prior to the Closing. Neither NRI,
\nnor to the Knowledge of NRI, the other party to the RP Lease, is in breach or
\nviolation of, or default under, the RP Lease, and no event has occurred, is
\npending or, to the Knowledge of NRI, is threatened, that, after the giving of
\nnotice, with lapse of time, or otherwise, would constitute a breach or default
\nby NRI or, to the Knowledge of NRI, the other party to the RP Lease under such
\nlease.<\/p>\n
12<\/p>\n
2.12 INTELLECTUAL PROPERTY.<\/p>\n
(a) NRI owns, is licensed or otherwise possesses legally
\nenforceable rights to use all of its Intellectual Property (as defined below)
\nthat is (i) required or necessary for the conduct of the business of NRI as
\ncurrently conducted or (ii) under development for such business, in either case
\nthe absence of which, individually or in the aggregate, would have a NRI MAE
\n(collectively, the “NRI Intellectual Property”). Each item of NRI Intellectual
\nProperty will be owned or available for use by the Surviving Corporation
\nimmediately following the Closing on substantially identical terms and
\nconditions as it was immediately prior to the Closing. NRI has taken all
\ncommercially reasonable measures to protect the proprietary nature of each item
\nof NRI Intellectual Property. To the Knowledge of NRI, (a) no other person or
\nentity has any rights to any of the NRI Intellectual Property owned by NRI
\n(except pursuant to agreements or licenses specified in SECTION 2.12(c) of the
\nDisclosure Schedule), and (b) no other person or entity is infringing, violating
\nor misappropriating any of the NRI Intellectual Property. For purposes of this
\nAgreement, “Intellectual Property” means all (i) patents and patent
\napplications, (ii) copyrights and registrations thereof, (iii) mask works and
\nregistrations and applications for registration thereof, (iv) computer software,
\ndata and documentation, (v) trade secrets and confidential business information,
\nwhether patentable or unpatentable and whether or not reduced to practice,
\nknow-how, manufacturing and production processes and techniques, research and
\ndevelopment information, copyrightable works, financial, marketing and business
\ndata, pricing and cost information, business and marketing plans and customer
\nand supplier lists and information, and (vi) trademarks, service marks, trade
\nnames, domain names and applications and registrations therefor. SECTION 2.12(a)
\nof the Disclosure Schedule lists each patent, patent application, copyright
\nregistration or application therefor, mask work registration or application
\ntherefor, and trademark, service mark, trade name and domain name, registration
\nor application therefor, software or copyrightable works owned by NRI. NRI (i)
\nis the sole and exclusive owner of, with right, title and intent in and to (free
\nand clear of any Security Interest and any other encumbrances), the NRI
\nIntellectual Property, including without limitation the NRI Software (as defined
\nin SECTION 2.12(e) below) or (ii) is a licensee of the NRI Intellectual Property
\nunder valid and binding license agreements listed in SECTION 2.12(c) of the
\nDisclosure Schedule.<\/p>\n
(b) None of the NRI Intellectual Property infringes or
\nviolates, or constitutes a misappropriation of, any Intellectual Property rights
\nof any person or entity. SECTION 2.12(b) of the Disclosure Schedule lists any
\ncomplaint, claim or notice, or written threat thereof, received by NRI alleging
\nany such infringement, violation or misappropriation. NRI has provided to
\nPurchasePro complete and accurate copies of all written documentation in NRI’s
\npossession relating to (i) any such complaint, claim, notice or threat or (ii)
\nclaims or disputes known to NRI concerning any NRI Intellectual Property.<\/p>\n
(c) SECTION 2.12(c) of the Disclosure Schedule identifies each
\nlicense or other agreement (or type of license or other agreement) pursuant to
\nwhich NRI has licensed, distributed or otherwise granted any rights to any third
\nparty with respect to, any NRI Intellectual Property.<\/p>\n
(d) SECTION 2.12(d) of the Disclosure Schedule identifies each
\nitem of NRI Intellectual Property that is owned by a party other than NRI, and
\nthe license or agreement <\/p>\n
13<\/p>\n
pursuant to which NRI uses it (excluding off-the-shelf software programs
\nlicensed by NRI pursuant to “shrink wrap” licenses).<\/p>\n
(e) NRI has not disclosed the source code for any of the
\nsoftware owned by it, including without limitation the source code for the
\nsoftware underlying the Provisional Application for Patent entitled “Baybuilder
\ndynamic commerce technology” as described in SECTION 2.12(a) of the Disclosure
\nSchedule (collectively, the “NRI Software”) or other confidential information
\nconstituting, embodied in or pertaining to the NRI Software to any person or
\nentity, except to the Principal Shareholder and Steven Kang, and NRI has taken
\ncommercially reasonable measures to prevent disclosure of such source code. The
\nNRI Software has not been altered by anyone other than the Principal Shareholder
\nand no derivative product has been derived from the NRI Software that is not
\nowned exclusively by NRI without any Security Interest or other encumbrances.<\/p>\n
(f) The execution and delivery of this Agreement by NRI and
\nthe consummation of the transactions contemplated hereby, will neither cause NRI
\nto be in violation or default under any license, sublicense or agreement listed
\nin SECTIONS 2.12(c) and (d) of the Disclosure Schedule or entitle any other
\nparty to any such license, sublicense or agreement to terminate or modify such
\nlicense, sublicense or agreement.<\/p>\n
(g) All of the copyrightable materials owned by NRI (including
\nthe NRI Software) have been created by employees of NRI within the scope of
\ntheir employment by NRI or by independent contractors of NRI who have executed
\nagreements expressly assigning all right, title and interest in such
\ncopyrightable materials to NRI. No portion of such copyrightable materials was
\njointly developed with any third party.<\/p>\n
2.13 CONTRACTS.<\/p>\n
(a) SECTION 2.13 of the Disclosure Schedule lists the
\nfollowing agreements (written or oral) to which NRI is a party:<\/p>\n
(i) any agreement (or group of related
\n agreements) for the lease of personal
\n property from or to third parties providing
\n for lease payments in excess of Twenty
\n Thousand Dollars ($20,000) per annum;<\/p>\n
(ii) any agreement (or group of related
\n agreements) for the purchase or sale of
\n products or for the furnishing or receipt of
\n services (A) that calls for performance over
\n a period of more than one year, (B) that
\n involves more than the sum of Twenty
\n Thousand Dollars ($20,000), or (C) in which
\n NRI has granted manufacturing rights, “most
\n favored nation” pricing provisions or
\n marketing or distribution rights relating to
\n any products or territory or has agreed to
\n purchase a minimum quantity of goods or
\n services or has agreed to purchase goods or
\n services exclusively from a certain party;<\/p>\n
(iii) any agreement establishing a partnership or
\n joint venture;<\/p>\n
14<\/p>\n
(iv) any agreement (or group of related
\n agreements) under which it has created,
\n incurred, assumed or guaranteed (or may
\n create, incur, assume or guarantee)
\n indebtedness (including capitalized lease
\n obligations) involving more than Twenty
\n Thousand Dollars ($20,000) or under which it
\n has imposed (or may impose) a Security
\n Interest on any of its assets, tangible or
\n intangible;<\/p>\n
(v) any agreement concerning confidentiality or
\n noncompetition;<\/p>\n
(vi) any employment or consulting agreement;<\/p>\n
(vii) any agreement involving any officer,
\n director or shareholder of NRI or any other
\n affiliate (an “Affiliate”), as defined in
\n Rule 12b-2 under the Securities Exchange Act
\n of 1934, as amended (the “Exchange Act”), of
\n NRI;<\/p>\n
(viii) any agreement under which the consequences
\n of a default or termination would reasonably
\n be expected to have a NRI MAE;<\/p>\n
(ix) any agreement that contains any provisions
\n requiring NRI to indemnify any other party
\n thereto (excluding indemnities contained in
\n agreements for the purchase, sale or license
\n of products entered into in the Ordinary
\n Course of Business); and<\/p>\n
(x) any other agreement (or group of related
\n agreements) either involving more than
\n Twenty Thousand Dollars ($20,000) or not
\n entered into in the Ordinary Course of
\n Business.<\/p>\n
(b) NRI has delivered to PurchasePro a complete and accurate
\ncopy of each agreement listed in SECTIONS 2.12 and 2.13 of the Disclosure
\nSchedule. With respect to each agreement so listed: (i) the agreement is legal,
\nvalid, binding and enforceable and in full force and effect; (ii) the agreement
\nwill continue to be legal, valid, binding and enforceable and in full force and
\neffect immediately following the Closing in accordance with the terms thereof as
\nin effect immediately prior to the Closing; and (iii) neither NRI nor, to the
\nKnowledge of NRI, any other party is in breach or violation of, or default
\nunder, any such agreement, and no event has occurred, is pending or, to the
\nKnowledge of NRI, is threatened, that, after the giving of notice, with lapse of
\ntime, or otherwise, would constitute a breach or default by NRI or, to the
\nKnowledge of NRI, any other party under such contract.<\/p>\n
2.14 ACCOUNTS RECEIVABLE. All accounts receivable of NRI reflected in
\nthe Financial Statements are valid receivables subject to no setoffs or
\ncounterclaims, have arisen in the ordinary course of business and, to the
\nKnowledge of NRI, are current and collectible (within a reasonable period of
\ntime after the date on which they first became due and payable), net of the
\napplicable reserve for bad debts in the Financial Statements.<\/p>\n
2.15 POWERS OF ATTORNEY. There are no outstanding powers of attorney
\nexecuted on behalf of NRI.<\/p>\n
15<\/p>\n
2.16 INSURANCE. SECTION 2.16 of the Disclosure Schedule lists each
\ninsurance policy (including fire, theft, casualty, general liability, workers
\ncompensation, business interruption, environmental, product liability and
\nautomobile insurance policies and bond and surety arrangements) to which NRI is
\na party. There is no material claim pending under any such policy as to which
\ncoverage has been questioned, denied or disputed by the underwriter of such
\npolicy. All premiums due and payable under all such policies have been paid, NRI
\nmay not be liable for retroactive premiums or similar payments, and NRI is
\notherwise in compliance in all material respects with the terms of such
\npolicies. NRI has no Knowledge of any threatened termination of, or material
\npremium increase with respect to, any such policy.<\/p>\n
2.17 LITIGATION. There is no action, suit, proceeding, claim,
\narbitration or investigation (a “Legal Proceeding”) that is pending or, to the
\nKnowledge of NRI, has been threatened against NRI or affecting the NRI Common
\nStock or the transactions contemplated by this Agreement. To the Knowledge of
\nNRI, there is no basis for any such Legal Proceeding.<\/p>\n
2.18 WARRANTIES. No product or service manufactured, sold, leased,
\nlicensed or delivered by NRI is subject to any guaranty, warranty, right of
\nreturn, right of credit or other indemnity other than (i) the applicable
\nstandard terms and conditions of sale or lease of NRI, which are set forth in
\nSECTION 2.18 of the Disclosure Schedule, and (ii) manufacturers’ warranties for
\nwhich NRI has no liability. SECTION 2.18 of the Disclosure Schedule sets forth
\nthe aggregate expenses incurred by NRI in fulfilling its obligations under its
\nguaranty, warranty, right of return and indemnity provisions during each of the
\nfiscal years and the interim period covered by the Financial Statements; and NRI
\ndoes not know of any reason why such expenses should significantly increase as a
\npercentage of sales in the future.<\/p>\n
2.19 EMPLOYEES.<\/p>\n
(a) SECTION 2.19 of the Disclosure Schedule contains a list of
\nall employees of NRI along with the position and the annual rate of compensation
\nof each such person. Each such employee has entered into a
\nconfidentiality\/assignment of inventions agreement with NRI, a copy of which has
\npreviously been delivered to PurchasePro. SECTION 2.19 of the Disclosure
\nSchedule contains a list of each employee of NRI, who is a party to a
\nnon-competition agreement or an employment agreement with NRI, and copies of
\nsuch agreements have previously been delivered to PurchasePro. To the Knowledge
\nof NRI, no key employee or group of employees has any plans to terminate
\nemployment with NRI before or after the Merger.<\/p>\n
(b) NRI is not a party to or bound by any collective
\nbargaining agreement, nor has either experienced any strikes, grievances, claims
\nof unfair labor practices or other collective bargaining disputes. NRI has no
\nKnowledge of any organizational effort made or threatened, either currently or
\nwithin the past two years, by or on behalf of any labor union with respect to
\nits employees.<\/p>\n
(c) NRI has complied with all applicable laws relating to the
\nemployment of labor, including provisions thereof relating to wages, hours,
\nequal opportunity, collective bargaining, discrimination against race, color,
\nnational origin, religious creed, physical or mental disability, sex, age,
\nancestry, medical condition, marital status or sexual orientation, and the
\nwithholding and payment of social security and other taxes. There is no
\ninvestigation of NRI’s <\/p>\n
16<\/p>\n
employment policies or practices by any governmental or regulatory authority
\npending or to the Knowledge of NRI, threatened.<\/p>\n
2.20 EMPLOYEE BENEFITS.<\/p>\n
(a) For purposes of this Agreement, the following terms shall
\nhave the following meanings:<\/p>\n
(i) “Employee Benefit Plan” means any “employee
\n pension benefit plan” (as defined in Section
\n 3(2) of ERISA), any “employee welfare
\n benefit plan” (as defined in Section 3(1) of
\n ERISA), and any other written or oral plan,
\n agreement or arrangement involving direct or
\n indirect compensation, including insurance
\n coverage, severance benefits, disability
\n benefits, deferred compensation, bonuses,
\n stock options, stock purchase, phantom
\n stock, stock appreciation or other forms of
\n incentive compensation or post-retirement
\n compensation.<\/p>\n
(ii) “ERISA” means the Employee Retirement Income
\n Security Act of 1974, as amended.<\/p>\n
(iii) “ERISA Affiliate” means any entity that is,
\n or at any applicable time was, a member of
\n (A) a controlled group of corporations (as
\n defined in Section 414(b) of the Code), (B)
\n a group of trades or businesses under common
\n control (as defined in Section 414(c) of the
\n Code), or (D) an affiliated service group
\n (as defined under Section 414(m) of the Code
\n or the regulations under Section 414(o) of
\n the Code), any of which includes or included
\n NRI.<\/p>\n
(b) SECTION 2.20(b) of the Disclosure Schedule contains a
\ncomplete and accurate list of all Employee Benefit Plans maintained, or
\ncontributed to, by NRI or any ERISA Affiliate. Complete and accurate copies of
\n(i) all Employee Benefit Plans that have been reduced to writing, (ii) written
\nsummaries of all unwritten Employee Benefit Plans, (iii) all related trust
\nagreements, insurance contracts and summary plan descriptions, and (iv) all
\nannual reports filed on IRS Form 500, 5500C or 5500R and (for all funded plans)
\nall plan financial statements for the last five plan years for each Employee
\nBenefit Plan, have been delivered to PurchasePro. Each Employee Benefit Plan has
\nbeen administered in all material respects in accordance with its terms and each
\nof NRI and the ERISA Affiliates has in all material respects met its obligations
\nwith respect to such Employee Benefit Plan and has made all required
\ncontributions thereto. NRI, each ERISA Affiliate and each Employee Benefit Plan
\nare in compliance in all material respects with the currently applicable
\nprovisions of ERISA and the Code and the regulations thereunder (including
\nSection 4980B of the Code, Subtitle K, Chapter 100 of the Code, and Sections 601
\nthrough 608 and Section 701 ET SEQ. of ERISA). All filings and reports as to
\neach Employee Benefit Plan required to have been submitted to the Internal
\nRevenue Service or to the United States Department of Labor have been duly
\nsubmitted.<\/p>\n
17<\/p>\n
(c) There are no Legal Proceedings (except claims for benefits
\npayable in the normal operation of the Employee Benefit Plans and proceedings
\nwith respect to qualified domestic relations orders) against or involving any
\nEmployee Benefit Plan or asserting any rights or claims to benefits under any
\nEmployee Benefit Plan that could give rise to any material liability.<\/p>\n
(d) All the Employee Benefit Plans that are intended to be
\nqualified under Section 401(a) of the Code have received determination letters
\nfrom the Internal Revenue Service to the effect that such Employee Benefit Plans
\nare qualified and the plans and the trusts related thereto are exempt from
\nfederal income taxes under Sections 401(a) and 501(a), respectively, of the
\nCode, no such determination letter has been revoked and revocation has not been
\nthreatened, and no such Employee Benefit Plan has been amended or operated since
\nthe date of its most recent determination letter or application therefor in any
\nrespect, and no act or omission has occurred, that would adversely affect its
\nqualification or materially increase its cost. Each Employee Benefit Plan that
\nis required to satisfy Section 401(k)(3) or Section 401(m)(2) of the Code has
\nbeen tested for compliance with, and satisfies the requirements of, Section
\n401(k)(3) and Section 401(m)(2) of the Code for each plan year ending prior to
\nthe Closing Date.<\/p>\n
(e) Neither NRI nor any ERISA Affiliate has ever maintained an
\nEmployee Benefit Plan subject to Section 412 of the Code or Title IV of ERISA.<\/p>\n
(f) At no time has NRI or any ERISA Affiliate been obligated
\nto contribute to any “multiemployer plan” (as defined in Section 4001(a)(3) of
\nERISA).<\/p>\n
(g) There are no unfunded obligations under any Employee
\nBenefit Plan providing benefits after termination of employment to any employee
\nof NRI (or to any beneficiary of any such employee), including retiree health
\ncoverage and deferred compensation, but excluding continuation of health
\ncoverage required to be continued under Section 4980B of the Code or other
\napplicable law and insurance conversion privileges under state law. The assets
\nof each Employee Benefit Plan that is funded are reported at their fair market
\nvalue on the books and records of such Employee Benefit Plan.<\/p>\n
(h) No act or omission has occurred and no condition exists
\nwith respect to any Employee Benefit Plan maintained by NRI or any ERISA
\nAffiliate that would subject NRI or any ERISA Affiliate to (i) any material
\nfine, penalty, tax or liability of any kind imposed under ERISA or the Code or
\n(ii) any contractual indemnification or contribution obligation protecting any
\nfiduciary, insurer or service provider with respect to any Employee Benefit
\nPlan.<\/p>\n
(i) No Employee Benefit Plan is funded by, associated with or
\nrelated to a “voluntary employee’s beneficiary association” within the meaning
\nof Section 501(c)(9) of the Code.<\/p>\n
(j) Each Employee Benefit Plan is amendable and terminable
\nunilaterally by NRI at any time without liability to NRI as a result thereof and
\nno Employee Benefit Plan, plan documentation or agreement, summary plan
\ndescription or other written communication <\/p>\n
18<\/p>\n
distributed generally to employees by its terms prohibits NRI from amending
\nor terminating any such Employee Benefit Plan.<\/p>\n
(k) SECTION 2.20(k) of the Disclosure Schedule discloses each:<\/p>\n
(i) agreement with any shareholder, director,
\n executive officer or other key employee of
\n NRI (A) the benefits of which are
\n contingent, or the terms of which are
\n materially altered, upon the occurrence of a
\n transaction involving NRI of the nature of
\n any of the transactions contemplated by this
\n Agreement, (B) providing any term of
\n employment or compensation guarantee or (C)
\n providing severance benefits or other
\n benefits after the termination of employment
\n of such director, executive officer or key
\n employee;<\/p>\n
(ii) agreement, plan or arrangement under which
\n any person may receive payments from NRI
\n that may be subject to the tax imposed by
\n Section 4999 of the Code or included in the
\n determination of such person’s “parachute
\n payment” under Section 280G of the Code; and<\/p>\n
(iii) agreement or plan binding NRI, including any
\n stock option plan, stock appreciation right
\n plan, restricted stock plan, stock purchase
\n plan, severance benefit plan or Employee
\n Benefit Plan, any of the benefits of which
\n will be increased, or the vesting of the
\n benefits of which will be accelerated, by
\n the occurrence of any of the transactions
\n contemplated by this Agreement or the value
\n of any of the benefits of which will be
\n calculated on the basis of any of the
\n transactions contemplated by this Agreement.<\/p>\n
(l) SECTION 2.20(l) of the Disclosure Schedule sets forth
\nthe policies of NRI with respect to accrued vacation, accrued sick time and
\nearned time-off and the amount of such liabilities as of December 31, 2000.<\/p>\n
2.21 ENVIRONMENTAL MATTERS. NRI has complied with all applicable
\nEnvironmental Laws (as defined below), except for violations of Environmental
\nLaws that, individually or in the aggregate, have not had and would not
\nreasonably be expected to have a NRI MAE. There is no pending or, to the
\nKnowledge of NRI, threatened civil or criminal litigation, written notice of
\nviolation, formal administrative proceeding, or investigation, inquiry or
\ninformation request by any Governmental Entity, relating to any Environmental
\nLaw involving NRI, except for litigation, notices of violations, formal
\nadministrative proceedings or investigations, inquiries or information requests
\nthat, individually or in the aggregate, have not had and would not reasonably be
\nexpected to have a NRI MAE. For purposes of this Agreement, “Environmental Law”
\nmeans any federal, state or local law, statute, rule or regulation or the common
\nlaw relating to the environment or occupational health and safety, including any
\nstatute, regulation, administrative decision or order pertaining to: (i)
\ntreatment, storage, disposal, generation and transportation of industrial, toxic
\nor hazardous materials or substances or solid or hazardous <\/p>\n
19<\/p>\n
waste; (ii) air, water and noise pollution; (iii) groundwater and soil
\ncontamination; (iv) the release or threatened release into the environment of
\nindustrial, toxic or hazardous materials or substances, or solid or hazardous
\nwaste, including emissions, discharges, injections, spills, escapes or
\ndumping of pollutants, contaminants or chemicals; (v) the protection of wild
\nlife, marine life and wetlands, including all endangered and threatened
\nspecies; (vi) storage tanks, vessels, containers, abandoned or discarded
\nbarrels, and other closed receptacles; (vii) health and safety of employees
\nand other persons; and (viii) manufacturing, processing, using, distributing,
\ntreating, storing, disposing, transporting or handling of materials regulated
\nunder any law as pollutants, contaminants, toxic or hazardous materials or
\nsubstances or oil or petroleum products or solid or hazardous waste. As used
\nabove, the terms “release” and “environment” shall have the meaning set forth
\nin the Comprehensive Environmental Response, Compensation and Liability Act
\nof 1980, as amended (“CERCLA”).<\/p>\n
2.22 LEGAL COMPLIANCE. NRI is, and the conduct and operations of its
\nbusiness is, in compliance with each applicable law (including rules and
\nregulations thereunder) of any federal, state, local or foreign government, or
\nany Governmental Entity, except for any violations or defaults that,
\nindividually or in the aggregate, have not had and would not reasonably be
\nexpected to have a NRI MAE.<\/p>\n
2.23 CUSTOMERS AND SUPPLIERS. SECTION 2.23 of the Disclosure Schedule
\nsets forth a list of (a) each customer that accounted for more than one percent
\nof the revenues of NRI during the last full fiscal year and the amount of
\nrevenues accounted for by such customer during each such period and (b) each
\nsupplier that is the sole supplier of any significant product to NRI. No such
\ncustomer or supplier has indicated within the past year that it will stop, or
\ndecrease the rate of, buying products or supplying products, as applicable, to
\nNRI. No unfilled customer order or commitment obligating NRI to process,
\nmanufacture or deliver products or perform services will result in a loss to
\nNRI, upon completion of performance. No purchase order or commitment of NRI is
\nin excess of normal requirements, nor are prices provided therein in excess of
\ncurrent market prices for the products or services to be provided thereunder.<\/p>\n
2.24 PERMITS. SECTION 2.24 of the Disclosure Schedule sets forth a list
\nof all permits, licenses, registrations, certificates, orders or approvals from
\nany Governmental Entity (including those issued or required under Environmental
\nLaws and those relating to the occupancy or use of owned or leased real
\nproperty) (“Permits”) issued to or held by NRI. Such listed Permits are the only
\nPermits that are required for NRI to conduct its business as presently conducted
\nor as proposed to be conducted, except for those the absence of which,
\nindividually or in the aggregate, have not had and would not reasonably be
\nexpected to have a NRI MAE. Each such Permit is in full force and effect and, to
\nthe Knowledge of NRI, no suspension or cancellation of such Permit is threatened
\nand there is no basis for believing that such Permit will not be renewable upon
\nexpiration.<\/p>\n
2.25 CERTAIN BUSINESS RELATIONSHIPS WITH AFFILIATES. No Affiliate of
\nNRI (a) owns any property or right, tangible or intangible, that is used in the
\nbusiness of NRI, (b) has any claim or cause of action against NRI, or (c) owes
\nany money to, or is owed any money by, NRI. SECTION 2.25 of the Disclosure
\nSchedule describes any transactions or relationships between NRI and any
\nAffiliate thereof that have occurred or existed since NRI’s inception.<\/p>\n
20<\/p>\n
2.26 BROKERS’ FEES. NRI has not retained any broker in connection with
\nthe transactions contemplated hereunder. PurchasePro has, and will have, no
\nobligation to pay any broker’s, finder’s investment banker’s, financial
\nadvisor’s or similar fee in connection with this Agreement or the transactions
\ncontemplated hereby by reason of any action taken by or on behalf of NRI.<\/p>\n
2.27 BOOKS AND RECORDS. The minute book and other similar records of
\nNRI contain complete and accurate records of all actions taken at any meetings
\nof NRI’s shareholders, Board of Directors or any committee thereof and of all
\nwritten consents executed in lieu of the holding of any such meeting.<\/p>\n
2.28 DISCLOSURE. No representation or warranty by NRI contained in this
\nAgreement, and no statement contained in the Disclosure Schedule or any other
\ndocument, certificate or other instrument delivered or to be delivered by or on
\nbehalf of NRI pursuant to this Agreement, contains or will contain any untrue
\nstatement of a material fact or omits or will omit to state any material fact
\nnecessary, in light of the circumstances under which it was or will be made, in
\norder to make the statements herein or therein not misleading.<\/p>\n
ARTICLE III
\n REPRESENTATIONS AND WARRANTIES
\n OF PURCHASEPRO AND THE MERGER SUBSIDIARY<\/p>\n
Each of PurchasePro and the Merger Subsidiary represents and warrants
\nto NRI as of the date hereof and as of the Closing Date, as follows:<\/p>\n
3.1 ORGANIZATION, QUALIFICATION AND CORPORATE POWER. PurchasePro is a
\ncorporation duly organized, validly existing and in good standing under the laws
\nof the State of Nevada and the Merger Subsidiary is a corporation incorporated
\nunder the Florida Business Corporation Act and its status is active. PurchasePro
\nis duly qualified to conduct business and is in corporate and tax good standing
\nunder the laws of each jurisdiction in which the nature of its businesses or the
\nownership or leasing of its properties requires such qualification, except where
\nthe failure to be so qualified or in good standing would not have an PurchasePro
\nMAE (as defined below). PurchasePro has all requisite corporate power and
\nauthority to carry on the businesses in which it is engaged and to own and use
\nthe properties owned and used by it. PurchasePro has furnished or made available
\nto NRI complete and accurate copies of its Articles of Incorporation and Bylaws.
\nFor purposes of this Agreement, “PurchasePro MAE” means a material adverse
\neffect on the assets, business, condition (financial or otherwise), results of
\noperations or future prospects of PurchasePro and its subsidiaries, taken as a
\nwhole, but shall not include any of the foregoing related to (i) the economy or
\nfinancial markets in general, (ii) the industries in general in which
\nPurchasePro operates and not specifically related to (or having the effect of
\nspecifically relating to or having a materially disproportionate effect
\n(relative to most other industry participants) on) PurchasePro, or (iii) any
\nchange in the market price or trading volume of PurchasePro.<\/p>\n
3.2 CAPITALIZATION. The authorized capital stock of PurchasePro
\nincludes 150,000,000 shares of PurchasePro Common Stock, of which 67,495,450
\nshares were issued and outstanding as of March 1, 2001. All of the issued and
\noutstanding shares of PurchasePro <\/p>\n
21<\/p>\n
Common Stock are duly authorized, validly issued, fully paid, nonassessable
\nand free of all preemptive rights.<\/p>\n
3.3 VALIDITY OF SHARES. The shares of PurchasePro Common Stock to be
\nissued pursuant to the Merger will, when issued: (a) be duly authorized, validly
\nissued, fully paid and nonassessable and free of liens and encumbrances created
\nby PurchasePro, and (b) be subject to applicable securities law restrictions on
\ntransfer, including those imposed by Regulation D or Section 4(2) of the 1933
\nAct and Rule 144 promulgated under the 1933 Act, under applicable “blue sky”
\nstate securities laws.<\/p>\n
3.4 AUTHORIZATION OF TRANSACTION. Each of PurchasePro and the Merger
\nSubsidiary has all requisite corporate power and authority to execute and
\ndeliver this Agreement and the agreements contemplated hereby and to perform its
\nrespective obligations hereunder and thereunder. The execution and delivery by
\nPurchasePro and the Merger Subsidiary of this Agreement and the agreements
\ncontemplated hereby and the consummation by PurchasePro and the Merger
\nSubsidiary of the transactions contemplated hereby and thereby have been duly
\nand validly authorized by all necessary corporate action on the part of
\nPurchasePro and the Merger Subsidiary, respectively. This Agreement has been
\nduly and validly executed and delivered by PurchasePro and the Merger Subsidiary
\nand constitutes a valid and binding obligation of PurchasePro and the Merger
\nSubsidiary, enforceable against them in accordance with its terms.<\/p>\n
3.5 NONCONTRAVENTION. Subject to (i) compliance with the applicable
\nrequirements of the Securities Act and any applicable state securities laws and
\nthe Exchange Act and (ii) the filing of the Articles of Merger as required by
\nthe FBCA, neither the execution and delivery by PurchasePro or the Merger
\nSubsidiary of this Agreement or (in the case of PurchasePro) the Escrow
\nAgreement, nor the consummation by PurchasePro or the Merger Subsidiary of the
\ntransactions contemplated hereby or thereby, will (a) conflict with or violate
\nany provision of the charter or Bylaws of PurchasePro or the Merger Subsidiary,
\n(b) require on the part of PurchasePro or the Merger Subsidiary any filing with,
\nor permit, authorization, consent or approval of, any Governmental Entity (c)
\nconflict with, result in breach of, constitute (with or without due notice or
\nlapse of time or both) a default under, result in the acceleration of
\nobligations under, create in any party any right to terminate, modify or cancel,
\nor require any notice, consent or waiver under, any contract or instrument to
\nwhich PurchasePro or the Merger Subsidiary is a party or by which either is
\nbound or to which any of their assets are subject, except for (i) any conflict,
\nbreach, default, acceleration, termination, modification or cancellation that
\nwould not adversely affect the consummation of the transactions contemplated
\nhereby or (ii) any notice, consent or waiver the absence of which would not
\nadversely affect the consummation of the transactions contemplated hereby, or
\n(d) violate any order, writ, injunction, decree, statute, rule or regulation
\napplicable to PurchasePro or the Merger Subsidiary or any of their properties or
\nassets.<\/p>\n
3.6 REPORTS AND FINANCIAL STATEMENTS. PurchasePro has previously
\nfurnished or made available to NRI complete and accurate copies, as amended or
\nsupplemented, of its (a) Annual Report on Form 10-K for the fiscal year ended
\nDecember 31, 1999, as filed with the Securities and Exchange Commission (the
\n“SEC”), and (b) all other reports filed by PurchasePro under Section 13 or
\nsubsections (a) or (c) of Section 14 of the Exchange Act with the SEC since
\nJanuary 1, 2000 (such reports are collectively referred to herein as the
\n“PurchasePro Reports”). <\/p>\n
22<\/p>\n
The PurchasePro Reports constitute all of the documents required to be filed
\nby PurchasePro under Section 13 or subsections (a) or (c) of Section 14 of
\nthe Exchange Act with the SEC from July 1, 1999 through the date of this
\nAgreement. The PurchasePro Reports complied in all material respects with the
\nrequirements of the Exchange Act and the rules and regulations thereunder
\nwhen filed. As of their respective dates, the PurchasePro Reports did not
\ncontain any untrue statement of a material fact or omit to state a material
\nfact required to be stated therein or necessary to make the statements
\ntherein, in light of the circumstances under which they were made, not
\nmisleading. The audited financial statements and unaudited interim financial
\nstatements of PurchasePro included in the PurchasePro Reports (i) complied as
\nto form in all material respects with applicable accounting requirements and
\nthe published rules and regulations of the SEC with respect thereto when
\nfiled, (ii) were prepared in accordance with GAAP applied on a consistent
\nbasis throughout the periods covered thereby (except as may be indicated
\ntherein or in the notes thereto, and in the case of quarterly financial
\nstatements, as permitted by Form 10-Q under the Exchange Act), (iii) fairly
\npresent the consolidated financial condition, results of operations and cash
\nflows of PurchasePro as of the respective dates thereof and for the periods
\nreferred to therein, and (iv) are consistent with the books and records of
\nPurchasePro.<\/p>\n
3.7 LITIGATION. Except as disclosed in the PurchasePro Reports, as of
\nthe date of this Agreement, there is no Legal Proceeding that is pending or, to
\nPurchasePro’s knowledge, threatened against PurchasePro or any subsidiary of
\nPurchasePro that, if determined adversely to PurchasePro or such subsidiary,
\ncould have, individually or in the aggregate, an PurchasePro MAE or that in any
\nmanner challenges or seeks to prevent, enjoin, alter or delay the transactions
\ncontemplated by this Agreement.<\/p>\n
3.8 INTERIM OPERATIONS OF THE MERGER SUBSIDIARY. The Merger Subsidiary
\nwas formed solely for the purpose of engaging in the transactions contemplated
\nby this Agreement and has engaged in no business activities other than as
\ncontemplated by this Agreement.<\/p>\n
3.9 BROKERS’ FEES. PurchasePro has not retained any broker in
\nconnection with the transactions contemplated hereunder. NRI has, and will have,
\nno obligation to pay any broker’s, finder’s investment banker’s, financial
\nadvisor’s or similar fee in connection with this Agreement or the transactions
\ncontemplated hereby by reason of any action taken by or on behalf of
\nPurchasePro.<\/p>\n
3.10 DISCLOSURE. No representation or warranty by PurchasePro contained
\nin this Agreement, and no statement contained in the any document, certificate
\nor other instrument delivered or to be delivered by or on behalf of PurchasePro
\npursuant to this Agreement, contains or will contain any untrue statement of a
\nmaterial fact or omit or will omit to state any material fact necessary, in
\nlight of the circumstances under which it was or will be made, in order to make
\nthe statements herein or therein not misleading.<\/p>\n
ARTICLE IV.
\n COVENANTS<\/p>\n
4.1 CLOSING EFFORTS. Each of the Parties shall use its best efforts to
\ntake all actions and to do all things necessary, proper or advisable to
\nconsummate the transactions contemplated <\/p>\n
23<\/p>\n
by this Agreement, including using its best efforts to ensure that (a) its
\nrepresentations and warranties remain true and correct in all material
\nrespects through the Closing Date and (b) the conditions to the obligations
\nof the other Parties to consummate the Merger are satisfied.<\/p>\n
4.2 GOVERNMENTAL AND THIRD-PARTY NOTICES AND CONSENTS.<\/p>\n
(a) Each Party shall use its best efforts to obtain, at its
\nexpense, all waivers, permits, consents, approvals or other authorizations from
\nGovernmental Entities, and to effect all registrations, filings and notices with
\nor to Governmental Entities, as may be required for such Party to consummate the
\ntransactions contemplated by this Agreement and to otherwise comply with all
\napplicable laws and regulations in connection with the consummation of the
\ntransactions contemplated by this Agreement.<\/p>\n
(b) NRI shall use its best efforts to obtain, at its expense,
\nall such waivers, consents or approvals from third parties set forth in SECTION
\n2.4 of the Disclosure Schedule.<\/p>\n
(c) PurchasePro and NRI shall cooperate with each other in
\ndetermining whether filings are required to be made or consents required to be
\nobtained in any jurisdiction in connection with the consummation of the
\ntransactions contemplated by this Agreement and in making or causing to be made
\nany such filings promptly and in seeking to obtain timely any such consents.<\/p>\n
(d) PurchasePro agrees that it will execute an agreement
\nwherein it agrees to be bound by the Standard Sales Agreement between NRI and
\nDofasco Inc. dated December 18, 2000 (the “Dofasco Agreement”) and fully perform
\nNRI’s obligations thereunder; PROVIDED that Dofasco Inc. agrees to revisions to
\nthe Dofasco Agreement pursuant to terms satisfactory to PurchasePro.<\/p>\n
4.3 OPERATION OF BUSINESS. Except as otherwise expressly contemplated
\nby this Agreement, during the period from the date of this Agreement to the
\nEffective Time, NRI shall conduct its operations in the Ordinary Course of
\nBusiness and in compliance with all applicable laws and regulations and, to the
\nextent consistent therewith, use its best efforts to preserve intact its current
\nbusiness organization, keep its physical assets in good working condition, keep
\navailable the services of its current officers and employees and preserve its
\nrelationships with customers, suppliers and others having business dealings with
\nit to the end that its goodwill and ongoing business shall not be impaired in
\nany material respect. Without limiting the generality of the foregoing, prior to
\nthe Effective Time, NRI shall not without the written consent of PurchasePro or
\nas otherwise specifically set forth in this Agreement:<\/p>\n
(a) issue or sell, or redeem or repurchase, any stock or other
\nsecurities of NRI or any rights, warrants or options to acquire any such stock
\nor other securities (except pursuant to the exercise or termination of the
\nDerivative Securities);<\/p>\n
(b) split, combine or reclassify any shares of its capital
\nstock or declare, set aside or pay any dividend or other distribution (whether
\nin cash, stock or property or any combination thereof) in respect of its capital
\nstock;<\/p>\n
24<\/p>\n
(c) create, incur or assume any indebtedness (including
\nobligations in respect of capital leases); assume, guarantee, endorse or
\notherwise become liable or responsible (whether directly, contingently or
\notherwise) for the obligations of any other person or entity; or make any loans,
\nadvances or capital contributions to, or investments in, any other person or
\nentity;<\/p>\n
(d) enter into, adopt or amend any Employee Benefit Plan or
\nany employment or severance agreement or arrangement of the type described in
\nSECTION 2.21(k) or increase in any manner the compensation or fringe benefits
\nof, or materially modify the employment terms of, its directors, officers or
\nemployees, generally or individually, or pay any bonus or other benefit to its
\ndirectors, officers or employees;<\/p>\n
(e) acquire, sell, lease, license or dispose of any assets or
\nproperty other than purchases and sales of assets in the Ordinary Course of
\nBusiness;<\/p>\n
(f) mortgage or pledge any of its property or assets or
\nsubject any such property or assets to any Security Interest;<\/p>\n
(g) discharge or satisfy any Security Interest or pay any
\nobligation or liability other than in the Ordinary Course of Business;<\/p>\n
(h) amend its charter, Bylaws or other organizational
\ndocuments, except for the amendment of its Articles of Incorporation to remove
\nArticle 8 of such articles;<\/p>\n
(i) change in any material respect its accounting methods,
\nprinciples or practices, except insofar as may be required by a generally
\napplicable change in GAAP;<\/p>\n
(j) enter into, amend, terminate, take or omit to take any
\naction that would constitute a violation of or default under, or waive any
\nrights under, any material contract or agreement;<\/p>\n
(k) make or commit to make any capital expenditure in excess
\nof Twenty Thousand Dollars ($20,000) per item or Forty Thousand ($40,000) in the
\naggregate;<\/p>\n
(l) institute or settle any Legal Proceeding;<\/p>\n
(m) take any action or fail to take any action permitted by
\nthis Agreement with the knowledge that such action or failure to take action
\nwould result in (i) any of the representations and warranties of NRI set forth
\nin this Agreement becoming untrue or (ii) any of the conditions to the Merger
\nset forth in ARTICLE V not being satisfied; or<\/p>\n
(n) agree in writing or otherwise to take any of the foregoing
\nactions.<\/p>\n
4.4 ACCESS TO INFORMATION. NRI shall permit representatives of
\nPurchasePro to have full access (at all reasonable times, and in a manner so as
\nnot to interfere with the normal business operations of NRI) to personnel,
\npremises properties, financial and accounting records, contracts, other records
\nand documents, and personnel, of or pertaining to NRI, in order to permit
\nPurchasePro to conduct its due diligence investigation with respect to the
\nperiod from the date hereof until the Effective Time. The confidentiality
\nprovisions of the letter agreement dated <\/p>\n
25<\/p>\n
January 31, 2001 entered into by PurchasePro and NRI (the “Confidentiality
\nAgreement”) shall continue in full force and effect.<\/p>\n
4.5 NOTICE OF BREACHES. From the date of this Agreement until the
\nEffective Time, NRI shall promptly deliver to PurchasePro supplemental
\ninformation concerning events or circumstances occurring subsequent to the date
\nhereof that would render any representation, warranty or statement in this
\nAgreement or the Disclosure Schedule inaccurate or incomplete in any material
\nrespect at any time after the date of this Agreement until the Closing Date or
\nthat would cause any condition precedent to NRI’s obligations hereunder not to
\nbe satisfied in a timely manner. No such supplemental information shall be
\ndeemed to cure any misrepresentation or breach of warranty or constitute an
\namendment of any representation, warranty or statement in this Agreement or the
\nDisclosure Schedule.<\/p>\n
4.6 EXCLUSIVITY.<\/p>\n
(a) Except with respect to this Agreement and the transactions
\ncontemplated hereby, NRI shall not, and NRI shall require each of its officers,
\ndirectors, employees, representatives and agents not to, directly or indirectly,
\n(i) initiate, solicit, encourage or otherwise facilitate any inquiry, proposal,
\noffer or discussion with any party (other than PurchasePro) concerning any
\nmerger, reorganization, consolidation, recapitalization, business combination,
\nliquidation, dissolution, share exchange, sale of stock, sale of material assets
\nor similar business transaction involving NRI, (ii) furnish any non-public
\ninformation concerning the business, properties or assets of NRI to any party
\n(other than PurchasePro) or (iii) engage in discussions or negotiations with any
\nparty (other than PurchasePro) concerning any such transaction.<\/p>\n
(b) NRI shall immediately notify any party with which
\ndiscussions or negotiations of the nature described in paragraph (a) above were
\npending that NRI is terminating such discussions or negotiations. If NRI
\nreceives any inquiry, proposal or offer of the nature described in paragraph (a)
\nabove, NRI shall, within one (1) business day after such receipt, notify
\nPurchasePro of such inquiry, proposal or offer, including the identity of the
\nother party and the terms of such inquiry, proposal or offer.<\/p>\n
4.7 TERMINATION OF DERIVATIVE SECURITIES AND VESTING OF NRI COMMON
\nSTOCK. Prior to the Closing, (a) NRI shall have either terminated the Derivative
\nSecurities under the terms thereof or converted the Derivative Securities into
\nNRI Common Stock, as the case may be, under the terms thereof, and all payment
\nobligations arising for any such termination shall be satisfied out of the Cash
\nConsideration or Merger Shares, and (b) all of the NRI Common Stock subject to
\nvesting shall have fully vested or such vesting rights shall have been
\nterminated prior to the Closing pursuant to the terms of the agreements
\nproviding for such vesting.<\/p>\n
4.8 APPROVAL OF NRI COMMON SHAREHOLDERS. NRI shall take the actions
\nnecessary to conduct a meeting of the NRI Common Shareholders to consider and
\nvote on the Merger, subject to compliance by PurchasePro’s obligations
\nhereunder, at the earliest practicable date after the Agreement Date (consistent
\nwith the requirements of Section 4(2) and\/or Regulation D under the 1933 Act)
\nand in connection therewith NRI’s Board of Directors shall recommend to the NRI
\nCommon Shareholders that they approve the Merger, this Agreement and the<\/p>\n
26<\/p>\n
transactions contemplated thereby. The vote of the NRI Common Shareholders shall
\nbe called, held and conducted, and any proxies or written consents shall be
\nsolicited, in compliance with NRI’s Articles of Incorporation and Bylaws, both
\nas amended, and in compliance with applicable law.<\/p>\n
4.9 APPROVAL BY PRINCIPAL SHAREHOLDER. The Principal Shareholder shall
\nvote all of his shares of NRI Common Stock to approve this Agreement and the
\nMerger and against any other alternative proposal and shall timely grant
\nPurchasePro an irrevocable proxy to so vote his shares of NRI Common Stock.<\/p>\n
4.10 CASH AS OF THE CLOSING DATE. NRI shall have at least $300,000 in
\ncash as of the Closing Date.<\/p>\n
4.11 NRI EMPLOYEE PLANS AND BENEFIT ARRANGEMENTS. NRI shall terminate
\nany Employee Benefit Plans that are governed by Section 401(K) of the Code
\nimmediately prior to the Effective Time upon the request of PurchasePro. In the
\nevent that the distribution or rollover of assets from the trust of a Code
\nSection 401(K) plan that is terminated will trigger liquidation, surrender or
\nother fees that will be imposed on the terminated plan or any participant or
\nbeneficiary of such terminated plan, NRI shall take such actions as are
\nnecessary to reasonably estimate the amount of such fees and provide such
\nreasonable estimate in writing to PurchasePro prior to the Effective Time. Any
\nEmployee Benefit Plan that is governed by Section 401(K) of the Code and relies
\non a standardized prototype document shall be amended prior to the Effective
\nTime so as not to require all corporations that are members of the same
\ncontrolled group of corporations as the employer sponsoring such plan to
\nparticipate in such plan. NRI shall file any delinquent Form 5500s through the
\nDepartment of Labor Delinquent Filer Voluntary Compliance Program prior to the
\nEffective Time.<\/p>\n
4.12 TAX-FREE REORGANIZATION.<\/p>\n
(a) Subject to the express terms of this Agreement, the
\nParties will not knowingly undertake any voluntary action that would cause the
\nMerger to fail to qualify as a “reorganization” within the meaning of Section
\n368(a) of the Code; PROVIDED, HOWEVER, that no breach of this covenant shall
\noccur as a result of the Parties consummating the Merger in accordance with the
\nterms of this Agreement.<\/p>\n
(b) Each of the Parties agree that they will prepare all Tax
\nReturns in a manner that is consistent with the treatment of the Merger as a
\ntax-free reorganization under Section 368(a) of the Code.<\/p>\n
4.13 CUSTOMER TRANSITION. NRI and the Principal Shareholder shall use
\nits best efforts to take all actions and to do all things necessary, proper or
\nadvisable to assist the Surviving Corporation or PurchasePro in working with and
\nmaintaining NRI’s existing customers in connection with the transactions
\ncontemplated by this Agreement.<\/p>\n
4.14 NRI CONTRACT TERMINATIONS. NRI and the Principal Shareholder shall
\nuse its best efforts to take all actions and to do all things necessary, proper
\nor advisable to assist the Surviving Corporation or PurchasePro in negotiating
\nterminations of the RP Lease, the Adelphia <\/p>\n
27<\/p>\n
Alarm System and Monitoring Agreement dated December 23, 1999 and the
\nCiberlynx, Inc. Internet Services and Equipment Contract Term Commitment
\ndated 27, 1999.<\/p>\n
ARTICLE V.
\n CONDITIONS TO CONSUMMATION OF MERGER<\/p>\n
5.1 CONDITIONS TO OBLIGATIONS OF PURCHASEPRO AND THE MERGER SUBSIDIARY.
\nThe obligation of each of PurchasePro and the Merger Subsidiary to consummate
\nthe Merger is subject to the satisfaction (or waiver by PurchasePro) of the
\nfollowing conditions:<\/p>\n
(a) NRI shall have obtained (and shall have provided copies
\nthereof to PurchasePro) all of the waivers, permits, consents, approvals or
\nother authorizations, and effected all of the registrations, filings and
\nnotices, referred to in SECTION 4.2 that are required on the part of NRI.<\/p>\n
(b) All representations and warranties of NRI set forth in
\nthis Agreement shall be true and correct in all material respects, in each case
\nas of the date of this Agreement and as of the Effective Time as though made as
\nof the Effective Time, except to the extent such representations and warranties
\nare specifically made as of a particular date or as of the date of this
\nAgreement (in which case such representations and warranties shall be true and
\ncorrect as of such date).<\/p>\n
(c) NRI shall have performed or complied with in all respects,
\nits agreements and covenants required to be performed or complied with under
\nthis Agreement as of or prior to the Effective Time.<\/p>\n
(d) No Legal Proceeding shall be pending or threatened wherein
\nan unfavorable judgment, order, decree, stipulation or injunction would (i)
\nprevent consummation of any of the transactions contemplated by this Agreement,
\n(ii) cause any of the transactions contemplated by this Agreement to be
\nrescinded following consummation or (iii) have a NRI MAE, and no such judgment,
\norder, decree, stipulation or injunction shall be in effect.<\/p>\n
(e) NRI shall have terminated or converted all Derivative
\nSecurities into NRI Common Stock.<\/p>\n
(f) The holders of at least ninety five percent (95%) of the
\noutstanding shares of NRI Common Stock shall have entered into the Registration
\nRights Agreement (either individually or by proxy) in the form attached hereto
\nas EXHIBIT D (the “Registration Rights Agreement”).<\/p>\n
(g) NRI shall have delivered to PurchasePro and the Merger
\nSubsidiary a certificate (the “NRI Certificate”) in the form of EXHIBIT E
\nattached hereto to the effect that each of the conditions specified in clauses
\n(a) through (d) (insofar as clause (d) relates to Legal Proceedings involving
\nNRI) of this SECTION 5.1 is satisfied in all respects.<\/p>\n
(h) Each of the NRI Common Shareholders not exercising his\/her
\ndissenter’s rights under the FBCA shall have executed and delivered to
\nPurchasePro an Investment Representation Letter.<\/p>\n
28<\/p>\n
(i) PurchasePro shall have received from Broad and Cassel,
\ncounsel to NRI, an opinion in the form attached hereto as EXHIBIT F, addressed
\nto PurchasePro and dated as of the Closing Date.<\/p>\n
(j) PurchasePro shall have received a certificate of NRI’s
\nsecretary in the form of EXHIBIT G attached hereto, certifying as of the Closing
\nDate (i) a true and complete copy of the Articles of Incorporation and Bylaws of
\nNRI certified as of a recent date by the Secretary of State of Florida, (ii) a
\ncertificate of each appropriate Secretary of State certifying the good standing
\nof NRI in its state of incorporation and all states in which it qualified to do
\nbusiness, (iii) a true and complete copy of the resolutions of the board of
\ndirectors of NRI and the resolutions of the NRI Common Shareholders, each
\nauthorizing the execution, delivery and performance of this Agreement by NRI and
\n(iv) incumbency matters.<\/p>\n
(k) The Principal Shareholder shall have entered into an
\nEmployment Agreement with PurchasePro in the form attached hereto as EXHIBIT H.<\/p>\n
(l) Each shareholder of NRI that has executed the Registration
\nRights Agreement, and Messrs. Rao, Sure, Shaik, Chittathoor and Mr. and Mrs.
\nPatil (to the extent Messrs. Rao, Sure, Shaik, Chittathoor or Mr. and Mrs. Patil
\nhave not executed the Registration Rights Agreement) shall have executed and
\ndelivered to PurchasePro a Shareholder Waiver Agreement in the form attached
\nhereto as EXHIBIT I.<\/p>\n
(m) PurchasePro shall have received the Escrow Agreement
\nexecuted by the Escrow Agent and the Shareholder Representative.<\/p>\n
(n) This Agreement, the Merger and all the other documents to
\nbe delivered hereunder will have been duly and validly approved and adopted, as
\nrequired by applicable law, by (i) NRI’s Board of Directors, and (ii) the valid
\nand affirmative vote of ninety five percent (95%) of the outstanding shares of
\nNRI’s capital stock entitled to vote thereon.<\/p>\n
(o) All officers, employees and consultants of NRI shall have
\nexecuted proprietary information and inventions agreements in the form attached
\nhereto as EXHIBIT J.<\/p>\n
(p) Each of The Timken Company, Dofasco Inc. and Owens Corning
\nshall have agreed to continue working with the Surviving Corporation or
\nPurchasePro under its existing terms with NRI or terms satisfactory to
\nPurchasePro.<\/p>\n
(q) Srikanth Jujare shall have paid to NRI the $37,125 that he
\nowes NRI in connection with his purchase of NRI Common Stock.<\/p>\n
5.2 CONDITIONS TO OBLIGATIONS OF NRI. The obligation of NRI to
\nconsummate the Merger is subject to the satisfaction of the following additional
\nconditions:<\/p>\n
(a) PurchasePro shall have effected all of the registrations,
\nfilings and notices referred to in SECTION 4.2 that are required on the part of
\nPurchasePro, except for any which if not obtained or effected would not have an
\nPurchasePro MAE or a material adverse effect on the ability of the Parties to
\nconsummate the transactions contemplated by this Agreement; <\/p>\n
29<\/p>\n
(b) All representations and warranties of PurchasePro and
\nthe Merger Subsidiary set forth in this Agreement shall be true and correct
\nin all material respects, in each case as of the date of this Agreement and
\nas of the Effective Time as though made as of the Effective Time, except to
\nthe extent such representations and warranties are specifically made as of a
\nparticular date or as of the date of this Agreement (in which case such
\nrepresentations and warranties shall be true and correct as of such date);<\/p>\n
(c) each of PurchasePro and the Merger Subsidiary shall have
\nperformed or complied with in all respects its agreements and covenants required
\nto be performed or complied with under this Agreement as of or prior to the
\nEffective Time;<\/p>\n
(d) no Legal Proceeding shall be pending or threatened wherein
\nan unfavorable judgment, order, decree, stipulation or injunction would (i)
\nprevent consummation of any of the transactions contemplated by this Agreement,
\n(ii) cause any of the transactions contemplated by this Agreement to be
\nrescinded following consummation or (iii) have an PurchasePro MAE, and no such
\njudgment, order, decree, stipulation or injunction shall be in effect;<\/p>\n
(e) PurchasePro shall have delivered to NRI a certificate (the
\n“PurchasePro Certificate”) in the form attached hereto as EXHIBIT K to the
\neffect that each of the conditions specified in clauses (a) through (d) (insofar
\nas clause (d) relates to Legal Proceedings involving PurchasePro or the Merger
\nSubsidiary) of this SECTION 5.2 is satisfied in all respects;<\/p>\n
(f) NRI shall have received a certificate of PurchasePro’s
\nSecretary in the form of EXHIBIT L attached hereto, certifying as of the Closing
\nDate (i) a true and complete copy of the Certificate of Incorporation and Bylaws
\nof PurchasePro certified as of a recent date by the Secretary of State of Nevada
\n(ii) a certificate of Secretary of State of Nevada certifying the good standing
\nof PurchasePro in its state of incorporation, (iii) a true and complete copy of
\nthe resolutions of the board of directors of PurchasePro, authorizing the
\nexecution, delivery and performance of this Agreement by PurchasePro and (iv)
\nincumbency matters.<\/p>\n
(g) NRI shall have received from Brobeck, Phleger & Harrison
\nLLP, counsel to PurchasePro, an opinion in the form attached hereto as EXHIBIT
\nM, addressed to NRI and the Principal Shareholder and dated as of the Closing
\nDate.<\/p>\n
(h) PurchasePro shall have executed and delivered to the
\nShareholder Representative the Registration Rights Agreement and the Escrow
\nAgreement.<\/p>\n
ARTICLE VI
\n INDEMNIFICATION<\/p>\n
6.1 INDEMNIFICATION BY THE PRINCIPAL SHAREHOLDER. The Principal
\nShareholder shall indemnify PurchasePro, the Surviving Corporation and their
\nrespective officers, directors, Affiliates, employees, agents, successors and
\nassigns (collectively the “PurchasePro Group”) in respect of, and hold it
\nharmless against, any and all debts, obligations and other liabilities (whether
\nabsolute, accrued, contingent, fixed or otherwise, or whether known or unknown,
\nor due or to become due or otherwise), monetary damages, fines, fees, penalties,
\ninterest obligations, deficiencies, losses and expenses (including amounts paid
\nin settlement, interest, <\/p>\n
30<\/p>\n
court costs, costs of investigators, fees and expenses of attorneys,
\naccountants, financial advisors and other experts, and other expenses of
\nlitigation) (“Damages”) incurred or suffered by any member of the PurchasePro
\nGroup thereof resulting from, relating to or constituting:<\/p>\n
(a) breach of any covenant, representation, warranty or
\nagreement made by NRI in or pursuant to this Agreement, or in other documents
\ndelivered in connection with the transactions contemplated in this Agreement;<\/p>\n
(b) any failure of any NRI Common Shareholder to have good,
\nvalid and marketable title to the issued and outstanding NRI Common Stock issued
\nin the name of such NRI Common Shareholder, free and clear of all Security
\nInterests and any other encumbrances;<\/p>\n
(c) any claim by a shareholder or former shareholder of NRI,
\nor any other person or entity, seeking to assert, or based upon: (i) ownership
\nor rights to ownership of any shares of stock of NRI; (ii) any rights of a
\nshareholder (other than the right to receive the Merger Shares pursuant to this
\nAgreement), including any option, preemptive rights or rights to notice or to
\nvote; (iii) any rights under the Articles of Incorporation or Bylaws of NRI; or
\n(iv) any claim that, his, her or its shares were wrongfully repurchased by NRI;
\nor<\/p>\n
(d) any Legal Proceedings listed in the Disclosure Schedule.<\/p>\n
6.2 INDEMNIFICATION BY PURCHASEPRO. PurchasePro shall indemnify the NRI
\nCommon Shareholders in respect of, and hold them harmless against, any and all
\nDamages incurred or suffered by the NRI Common Shareholders resulting from,
\nrelating to or constituting any breach of any covenant, representation, warranty
\nor agreement made by PurchasePro or the Merger Subsidiary in or pursuant to this
\nAgreement or in other documents delivered in connection with the transactions
\ncontemplated in this Agreement.<\/p>\n
6.3 INDEMNIFICATION CLAIMS.<\/p>\n
(a) THIRD PARTY SUIT OR PROCEEDING. A party entitled, or
\nseeking to assert rights, to indemnification under this ARTICLE VI (an
\n“Indemnified Party”) shall give written notification to the party from whom
\nindemnification is sought (an “Indemnifying Party”) of the commencement of any
\nsuit or proceeding relating to a third party claim for which indemnification
\npursuant to this ARTICLE VI may be sought. Such notification shall be given
\nwithin twenty (20) business days after receipt by the Indemnified Party of
\nnotice of such suit or proceeding, and shall describe in reasonable detail (to
\nthe extent known by the Indemnified Party) the facts constituting the basis for
\nsuch suit or proceeding and the amount of the claimed damages; PROVIDED,
\nHOWEVER, that no delay on the part of the Indemnified Party in notifying the
\nIndemnifying Party shall relieve the Indemnifying Party of any liability or
\nobligation hereunder except to the extent of any damage or liability caused by
\nor arising out of such failure. Within twenty (20) calendar days after delivery
\nof such notification, the Indemnifying Party may, upon written notice thereof to
\nthe Indemnified Party, assume control of the defense of such suit or proceeding
\nwith counsel reasonably satisfactory to the Indemnified Party; PROVIDED that (i)
\nthe Indemnifying Party may only assume control of such defense if (A) it
\nacknowledges in writing to the Indemnified Party that any damages, fines, costs
\nor other liabilities that may be assessed against the Indemnified Party in
\nconnection with such suit or proceeding constitute Damages for <\/p>\n
31<\/p>\n
which the Indemnified Party shall be indemnified pursuant to this ARTICLE VI
\nand (B) the AD DAMNUM is less than or equal to the amount of Damages for
\nwhich the Indemnifying Party is liable under this ARTICLE VI and (ii) the
\nIndemnifying Party may not assume control of the defense of a suit or
\nproceeding involving criminal liability or in which equitable relief is
\nsought against the Indemnified Party. If the Indemnifying Party does not so
\nassume control of such defense, the Indemnified Party shall control such
\ndefense. The party not controlling such defense (the “Non-controlling Party”)
\nmay participate therein at its own expense; PROVIDED that if the Indemnifying
\nParty assumes control of such defense and the Indemnified Party reasonably
\nconcludes that the Indemnifying Party and the Indemnified Party have
\nconflicting interests or different defenses available with respect to such
\nsuit or proceeding, the reasonable fees and expenses of counsel to the
\nIndemnified Party shall be considered “Damages” for purposes of this
\nAgreement. The party controlling such defense (the “Controlling Party”) shall
\nkeep the Non-controlling Party advised of the status of such suit or
\nproceeding and the defense thereof and shall consider in good faith
\nrecommendations made by the Non-controlling Party with respect thereto. The
\nNon-controlling Party shall furnish the Controlling Party with such
\ninformation as it may have with respect to such suit or proceeding (including
\ncopies of any summons, complaint or other pleading that may have been served
\non such party and any written claim, demand, invoice, billing or other
\ndocument evidencing or asserting the same) and shall otherwise cooperate with
\nand assist the Controlling Party in the defense of such suit or proceeding.
\nThe Indemnifying Party shall not agree to any settlement of, or the entry of
\nany judgment arising from, any such suit or proceeding without the prior
\nwritten consent of the Indemnified Party, that shall not be unreasonably
\nwithheld or delayed. The Indemnified Party shall not agree to any settlement
\nof, or the entry of any judgment arising from, any such suit or proceeding
\nwithout the prior written consent of the Indemnifying Party, which shall not
\nbe unreasonably withheld or delayed.<\/p>\n
(b) INDEMNIFICATION CLAIM PROCEDURE. Except as provided in
\nSECTION 6.3(a) above, in order to seek indemnification under this ARTICLE VI, an
\nIndemnified Party shall give written notification (a “Claim Notice”) to the
\nIndemnifying Party pursuant to the procedure set forth in Section 4(c) of the
\nEscrow Agreement. In the event the Escrow Agreement has terminated and the
\nIndemnifying Party disputes the claim by the Indemnified Party, the Indemnifying
\nParty shall deliver to the Indemnified Party a written response (the “Response”)
\nin which the Indemnifying Party shall: (i) agree that the Indemnified Party is
\nentitled to receive part, but not all, of the Damages in dispute (the “Claimed
\nAmount”), in which case the Response shall be accompanied by a payment by the
\nIndemnifying Party to the Indemnified Party of the Damages not in dispute (the
\n“Agreed Amount”), by check or by wire transfer or (ii) dispute that the
\nIndemnified Party is entitled to receive any of the Claimed Amount. If the
\nIndemnifying Party in the Response disputes its liability for all or part of the
\nClaimed Amount, the Indemnifying Party and the Indemnified Party shall follow
\nthe procedures set forth in this SECTION 6.3(b) for the resolution of such
\ndispute (a “Dispute”).<\/p>\n
During the sixty (60)-day period following the delivery of a Response
\nthat reflects a Dispute, the Indemnifying Party and the Indemnified Party shall
\nuse good faith efforts to resolve the Dispute. If the Dispute is not resolved
\nwithin such sixty (60)-day period, the Indemnifying Party and the Indemnified
\nParty shall discuss in good faith the submission of the Dispute to a mutually
\nacceptable alternative dispute resolution procedure (which may be non-binding or
\nbinding upon the parties, as they agree in advance) (the “ADR Procedure”). In
\nthe event the <\/p>\n
32<\/p>\n
Indemnifying Party and the Indemnified Party agree upon an ADR Procedure,
\nsuch parties shall, in consultation with the chosen dispute resolution
\nservice (the “ADR Service”), promptly agree upon a format and timetable for
\nthe ADR Procedure, agree upon the rules applicable to the ADR Procedure, and
\npromptly undertake the ADR Procedure. The provisions of this SECTION 6.3(b)
\nshall not obligate the Indemnifying Party and the Indemnified Party to pursue
\nan ADR Procedure or prevent either such party from pursuing the Dispute in a
\ncourt of competent jurisdiction; PROVIDED that, if the Indemnifying Party and
\nthe Indemnified Party agree to pursue an ADR Procedure, neither the
\nIndemnifying Party nor the Indemnified Party may commence litigation or seek
\nother remedies with respect to the Dispute prior to the completion of such
\nADR Procedure. Any ADR Procedure undertaken by the Indemnifying Party and the
\nIndemnified Party shall be considered a compromise negotiation for purposes
\nof federal and state rules of evidence, and all statements, offers, opinions
\nand disclosures (whether written or oral) made in the course of the ADR
\nProcedure by or on behalf of the Indemnifying Party, the Indemnified Party or
\nthe ADR Service shall be treated as confidential and, where appropriate, as
\nprivileged work product. Such statements, offers, opinions and disclosures
\nshall not be discoverable or admissible for any purposes in any litigation or
\nother proceeding relating to the Dispute (provided that this sentence shall
\nnot be construed to exclude from discovery or admission any matter that is
\notherwise discoverable or admissible). The fees and expenses of any ADR
\nService used by the Indemnifying Party and the Indemnified Party shall be
\nshared equally by the Indemnifying Party and the Indemnified Party.<\/p>\n
Notwithstanding the other provisions of this SECTION 6.3, if a third
\nparty asserts (other than by means of a lawsuit) that an Indemnified Party is
\nliable to such third party for a monetary or other obligation that may
\nconstitute or result in Damages for which such Indemnified Party may be entitled
\nto indemnification pursuant to this ARTICLE VI, and such Indemnified Party
\nreasonably determines that it has a valid business reason to fulfill such
\nobligation, then (i) such Indemnified Party shall be entitled to satisfy such
\nobligation, without prior notice to or consent from the Indemnifying Party, (ii)
\nsuch Indemnified Party may subsequently make a claim for indemnification in
\naccordance with the provisions of this ARTICLE VI, and (iii) such Indemnified
\nParty shall be reimbursed, in accordance with the provisions of this ARTICLE VI,
\nfor any such Damages for which it is entitled to indemnification pursuant to
\nthis ARTICLE VI (subject to the right of the Indemnifying Party to dispute the
\nIndemnified Party’s entitlement to indemnification, or the amount for which it
\nis entitled to indemnification, under the terms of this ARTICLE VI).<\/p>\n
For purposes of this SECTION 6.3 and the last two sentences of SECTION
\n6.4, if the NRI Common Shareholders comprise the Indemnifying Party, any
\nreferences to the Indemnifying Party (except provisions relating to an
\nobligation to make or a right to receive any payments provided for in SECTION
\n6.3 or 6.4) shall be deemed to refer to the Shareholder Representative. The
\nShareholder Representative shall have full power and authority on behalf of each
\nNRI Common Shareholder to take any and all actions on behalf of, execute any and
\nall instruments on behalf of, and execute or waive any and all rights of, the
\nNRI Common Shareholders under this ARTICLE VI. The Shareholder Representative
\nshall have no liability to any NRI Common Shareholder for any action taken or
\nomitted on behalf of the NRI Common Shareholders pursuant to this ARTICLE VI.<\/p>\n
(c) TAX INDEMNITY. Notwithstanding anything in this Agreement
\nto the contrary, in the event any member of the PurchasePro Group incurs Damages
\narising resulting <\/p>\n
33<\/p>\n
from a breach of the representations or warranties set forth in SECTION 2.9
\nherein, including without limitation the Disclosure Schedule referred to
\ntherein and relating to such Section (“Tax Losses”), PurchasePro shall have
\nthe right, for the period covered by SECTION 2.9 hereof, to control any audit
\nor determination by any taxing authority, initiate any claim for refund or
\namended return, contest, defend against, resolve, and settle any assessment,
\nnotice of deficiency or other adjustment or proposed adjustment of Taxes or
\notherwise resolve any issue pertaining to any Tax Losses; PROVIDED, HOWEVER,
\nthat PurchasePro will not settle any such claim that would result in an
\nindemnity obligation on the Principal Shareholder without the Principal
\nShareholder’s prior written consent, which consent shall not be unreasonably
\nwithheld. The Principal Shareholder shall have the right to receive in a
\ntimely manner copies of all non-privileged correspondence, records and
\nrelevant documentation and to be timely informed of and to attend all
\nmeetings with third parties relating to any claimed Tax Losses.<\/p>\n
6.4 SURVIVAL OF REPRESENTATIONS AND WARRANTIES. All representations and
\nwarranties contained in this Agreement, shall (a) survive the Closing and any
\ninvestigation at any time made by or on behalf of an Indemnified Party and (b)
\nshall remain in full force and effect for a period of twenty four (24) months
\nafter the Effective Date; PROVIDED, HOWEVER, that the representations and
\nwarranties in SECTIONS 2.1-2.3 shall survive indefinitely and the
\nrepresentations and warranties in SECTION 2.9 shall survive for the applicable
\nstatute of limitation plus one year. If an Indemnified Party delivers to an
\nIndemnifying Party, before expiration of a representation or warranty, either a
\nClaim Notice based upon a breach of such representation or warranty, or a notice
\nthat, as a result a legal proceeding instituted by or written claim made by a
\nthird party, the Indemnified Party reasonably expects to incur Damages as a
\nresult of a breach of such representation or warranty (an “Expected Claim
\nNotice”), then such representation or warranty shall survive until, but only for
\npurposes of, the resolution of the matter covered by such notice. If the legal
\nproceeding or written claim with respect to which an Expected Claim Notice has
\nbeen given is definitively withdrawn or resolved in favor of the Indemnified
\nParty, the Indemnified Party shall promptly so notify the Indemnifying Party;
\nand if the Indemnified Party has delivered a copy of the Expected Claim Notice
\nto the Escrow Agent and Escrow Cash or Escrow Shares have been retained in
\nescrow after the Termination Date (as defined in the Escrow Agreement) with
\nrespect to such Expected Claim Notice, the Indemnifying Party and the
\nIndemnified Party shall promptly deliver to the Escrow Agent a written notice
\nexecuted by both parties instructing the Escrow Agent to distribute such
\nretained Escrow Cash or Escrow Shares to the NRI Common Shareholders in
\naccordance with the terms of the Escrow Agreement.<\/p>\n
6.5 LIMITATIONS.<\/p>\n
(a) ESCROW ACCOUNT. In the event that any member of the
\nPurchasePro Group is entitled to indemnification under this ARTICLE VI,
\nPurchasePro’s first recourse for indemnification shall be the Escrow Fund. After
\nthe Escrow Fund is exhausted or the Escrow Agreement is terminated, PurchasePro
\nshall be entitled to seek indemnification under this ARTICLE VI directly from
\nthe Principal Shareholder.<\/p>\n
(b) THRESHOLD AMOUNT. The Principal Shareholder shall have no
\nliability to any member of the PurchasePro Group, and PurchasePro shall have no
\nliability to the NRI Common Shareholders, for amounts payable pursuant to their
\nrespective indemnification obligations in this ARTICLE VI until the total of all
\nsuch Damages incurred by the Indemnified <\/p>\n
34<\/p>\n
Party exceed Fifty Thousand Dollars ($50,000) in the aggregate (the
\n“Threshold Amount”), and then indemnification by the Indemnifying Party shall
\napply to all such Damages exceeding the Threshold Amount.<\/p>\n
(c) CAP AMOUNT. The Principal Shareholder shall have no
\nliability to any member of the PurchasePro Group, and PurchasePro shall have no
\nliability to the NRI Common Shareholders, pursuant to their respective
\nindemnification obligations in this ARTICLE VI to the extent that the total of
\nall Damages (subject to the threshold requirements set forth in SECTION 6.5(b)
\nabove) paid by such indemnifying party pursuant to such indemnification
\nobligations exceeds Fifteen Million Dollars ($15,000,000) in the aggregate.<\/p>\n
(d) FRAUD EXCEPTION. The limitation on the Principal
\nShareholder’s and PurchasePro’s indemnification obligation in this ARTICLE VI
\nshall not apply to any fraud by NRI or the Principal Shareholder, or by
\nPurchasePro, as the case may be, or to Damages resulting from (i) disputes as to
\nthe title of NRI Common Stock or (ii) Legal Proceedings listed in the Disclosure
\nSchedule.<\/p>\n
ARTICLE VII
\n TERMINATION<\/p>\n
7.1 TERMINATION OF AGREEMENT. The Parties may terminate this Agreement
\nprior to the Effective Time as provided below (the “Termination Date”):<\/p>\n
(a) the Parties may terminate this Agreement by mutual written
\nconsent;<\/p>\n
(b) PurchasePro may terminate this Agreement by giving written
\nnotice to NRI in the event NRI is in breach of any representation, warranty or
\ncovenant contained in this Agreement, and such breach, individually or in
\ncombination with any other such breach, would cause any of the conditions set
\nforth in SECTION 5.1 not to be satisfied and which breach is not cured within
\nten (10) business days of receipt of notice thereof;<\/p>\n
(c) NRI may terminate this Agreement by giving written notice
\nto PurchasePro in the event PurchasePro or the Merger Subsidiary is in breach of
\nany representation, warranty or covenant contained in this Agreement, and such
\nbreach, individually or in combination with any other such breach, would cause
\nthe conditions set forth in SECTION 5.2 not to be satisfied and which breach is
\nnot cured within ten (10) business days of receipt of notice thereof;<\/p>\n
(d) PurchasePro may terminate this Agreement by giving written
\nnotice to NRI if the Closing shall not have occurred within forty five (45) days
\nof the date hereof by reason of the failure of any condition precedent under
\nSECTION 5.1 (unless the failure results primarily from a breach by PurchasePro
\nor the Merger Subsidiary of any representation, warranty or covenant contained
\nin this Agreement); or<\/p>\n
(e) NRI may terminate this Agreement by giving written notice
\nto PurchasePro and the Merger Subsidiary if the Closing shall not have occurred
\nwithin forty five (45) days of the date hereof by reason of the failure of any
\ncondition precedent under SECTION 5.2 <\/p>\n
35<\/p>\n
(unless the failure results primarily from a breach by NRI of any
\nrepresentation, warranty or covenant contained in this Agreement).<\/p>\n
7.2 EFFECT OF TERMINATION. If any Party terminates this Agreement
\npursuant to SECTION 7.1, all obligations of the Parties hereunder shall
\nterminate without any liability of any Party to any other Party (except for any
\nliability of any Party for breaches of this Agreement, PROVIDED that the
\nprovisions of the Confidentiality Agreement shall survive the termination of
\nthis Agreement).<\/p>\n
ARTICLE VIII
\n DEFINITIONS<\/p>\n
8.1 DEFINITIONS. For purposes of this Agreement, each of the following
\ndefined terms is defined in the Section of this Agreement indicated below.<\/p>\n
\n\n DEFINED TERM SECTION
\n ———— ——-
\n
\n ADR Procedure 6.3(b)
\n ADR Service 6.3(b)
\n Affiliate 2.13(a)(vii)
\n Agreed Amount 6.3(b)
\n Agreement Introduction
\n Articles of Merger 1.2
\n CERCLA 2.21
\n Cash Consideration 1.5(a)
\n Certificates 1.5(f)
\n Claim Notice 6.3(b)
\n Claimed Amount 6.3(b)
\n Closing 1.13(a)
\n Closing Date 1.13(a)
\n Closing Share Price 1.5(a)
\n Code Recitals
\n Confidentiality Agreement 4.4
\n Controlling Party 6.3(a)
\n Damages 6.1
\n Dofasco Agreement 4.2(d)
\n Derivative Securities 1.5(c)
\n Disclosure Schedule Article II
\n Dispute 6.3(b)
\n Dissenting Shares 1.8(a)
\n ERISA 2.20(a)(ii)
\n ERISA Affiliate 2.20(a)(iii)
\n Effective Time 1.2
\n Employee Benefit Plan 2.20(a)(i)
\n Environmental Law 2.21(a)
\n Escrow Agreement 1.9
\n Escrow Cash 1.9
\n Escrow Fund 1.9
\n Escrow Shares 1.9
\n Exchange Act 2.13(a)(vii)
\n Exchange Agent 1.6(a)
\n Exchange Ratio 1.5(a)
\n Expected Claim Notice 6.4<\/p>\n 36<\/p>\n
DEFINED TERM SECTION
\n ———— ——-
\n FBCA Recitals
\n Financial Statements 2.6
\n GAAP 2.6
\n Governmental Entity 2.4(b)
\n Indemnified Party 6.3(a)
\n Indemnifying Party 6.3(a)
\n Intellectual Property 2.12(a)
\n Investment Representation Letter 1.12
\n Leased Property 2.11
\n Legal Proceeding 2.17
\n Knowledge of NRI 2.2
\n Merger Recitals
\n Merger Shares 1.5(e)
\n Merger Subsidiary Introduction
\n NRI Introduction
\n NRI Certificate 5.1(g)
\n NRI Common Stock 1.5(a)
\n NRI Common Shareholders 2.2
\n NRI Intellectual Property 2.12(a)
\n NRI MAE 2.1
\n NRI Software 2.12(e)
\n Non-controlling Party 6.3(a)
\n Ordinary Course of Business 2.4
\n Outstanding NRI Common Stock 1.5(a)
\n Parties Introduction
\n Permits 2.24
\n Principal Shareholder Introduction
\n PurchasePro Introduction
\n PurchasePro Certificate 5.2(e)
\n PurchasePro Common Stock 1.5(a)
\n PurchasePro MAE 3.1
\n PurchasePro Reports 3.6
\n RP Lease 2.11
\n Record Date 2.3(c)
\n Registration Rights Agreement 5.1(f)
\n Representative Agreement 1.11
\n Response 6.3(b)
\n SEC 3.6
\n Securities Act 1.12
\n Security Interest 2.4(e)
\n Shareholder Representative 1.11
\n Surviving Corporation 1.1
\n Tax Losses 6.3(c)
\n Tax Returns 2.9(a)(ii)
\n Taxes 2.9(a)(i)
\n Termination Date 7.1
\n Threshold Amount 6.5(b)<\/p>\n
<\/c><\/s><\/caption>\n<\/table>\n
37<\/p>\n
ARTICLE IX
\n MISCELLANEOUS<\/p>\n
9.1 PUBLIC ANNOUNCEMENTS. Upon execution of this Agreement, PurchasePro
\nand NRI will issue a press release approved by both parties announcing the
\nMerger. Thereafter, PurchasePro may issue such press releases, and make such
\nother disclosures regarding the Merger, as it determines are required under
\napplicable securities laws or regulatory rules. Prior to the publication of such
\npress release (unless this Agreement has been terminated), neither party will
\nmake any public announcement relating to this Agreement or the transactions
\ncontemplated hereby (unless PurchasePro determines that it is required under
\napplicable securities laws or regulatory rules to issue a press release) and NRI
\nwill use its best efforts to prevent any trading in PurchasePro Common Stock by
\nits officers, directors, employees, shareholders and agents.<\/p>\n
9.2 NO THIRD PARTY BENEFICIARIES. This Agreement shall not confer any
\nrights or remedies upon any person other than the Parties and their respective
\nsuccessors and permitted assigns; PROVIDED, HOWEVER, that the provisions
\nconcerning indemnification are intended for the benefit of the individuals
\nspecified therein and their successors and assigns.<\/p>\n
9.3 ENTIRE AGREEMENT. This Agreement (including the documents referred
\nto herein) constitutes the entire agreement among the Parties and supersedes any
\nprior understandings, agreements or representations by or among the Parties,
\nwritten or oral, with respect to the subject matter hereof.<\/p>\n
9.4 SUCCESSION AND ASSIGNMENT. This Agreement shall be binding upon and
\ninure to the benefit of the Parties named herein and their respective successors
\nand permitted assigns. No Party may assign either this Agreement or any of its
\nrights, interests or obligations hereunder without the prior written approval of
\nthe other Parties.<\/p>\n
9.5 COUNTERPARTS AND FACSIMILE SIGNATURE. This Agreement may be
\nexecuted in two or more counterparts, each of which shall be deemed an original
\nbut all of which together shall constitute one and the same instrument. This
\nAgreement may be executed by facsimile signature.<\/p>\n
9.6 HEADINGS. The Section headings contained in this Agreement are
\ninserted for convenience only and shall not affect in any way the meaning or
\ninterpretation of this Agreement.<\/p>\n
38<\/p>\n
9.7 NOTICES. All notices, requests, demands, claims, and other
\ncommunications hereunder shall be in writing. Any notice, request, demand,
\nclaim or other communication hereunder shall be deemed duly delivered four
\nbusiness days after it is sent by registered or certified mail, return
\nreceipt requested, postage prepaid, or one business day after it is sent for
\nnext business day delivery via a reputable nationwide overnight courier
\nservice, in each case to the intended recipient as set forth below:<\/p>\n
TO PURCHASEPRO AND\/OR THE MERGER PurchasePro.com, Inc.
\n SUBSIDIARY: 3291 North Buffalo Drive
\n Las Vegas, NV 89129
\n Fax: (702) 316-7001
\n Attention: Scott Wiegand<\/p>\n
WITH A COPY TO: Brobeck, Phleger & Harrison LLP
\n 12390 El Camino Real
\n San Diego, CA 92103
\n Fax: (858) 720-2555
\n Attention: Michael Kagnoff, Esq.
\n Eddie Rodriguez, Esq.
\n To the Principal Shareholder or the NRI Abu M. Rahman
\n Common Shareholders 2101 NW Corporate Blvd., Ste. 414
\n c\/o Shareholder Representative: Boca Raton, FL 33431
\n Fax: (561) 620-0543<\/p>\n
WITH A COPY TO: Broad and Cassel
\n 7777 Glades Road, Suite 300
\n Boca Raton, FL 33434
\n Fax: (561) 483-7321
\n Attention: David J. Powers, P.A.<\/p>\n
Any Party may give any notice, request, demand, claim or other communication
\nhereunder using any other means (including personal delivery, expedited courier,
\nmessenger service, facsimile, ordinary mail or electronic mail), but no such
\nnotice, request, demand, claim or other communication shall be deemed to have
\nbeen duly given unless and until it actually is received by the party for whom
\nit is intended. Any Party may change the address to which notices, requests,
\ndemands, claims, and other communications hereunder are to be delivered by
\ngiving the other Parties notice in the manner herein set forth.<\/p>\n
9.8 GOVERNING LAW. This Agreement shall be governed by and construed in
\naccordance with the internal laws of the State of Nevada without giving effect
\nto any choice or conflict of law provision or rule that would cause the
\napplication of laws of any jurisdictions other than those of the State of
\nNevada; PROVIDED that the Articles of Merger shall be governed by and
\ninterpreted and enforced in accordance with the FBCA.<\/p>\n
39<\/p>\n
9.9 AMENDMENTS AND WAIVERS. The Parties may mutually amend any
\nprovision of this Agreement at any time prior to the Effective Time. No
\namendment of any provision of this Agreement shall be valid unless the same
\nshall be in writing and signed by all of the Parties. No waiver of any right or
\nremedy hereunder shall be valid unless the same shall be in writing and signed
\nby the Party giving such waiver. No waiver by any Party with respect to any
\ndefault, misrepresentation or breach of warranty or covenant hereunder shall be
\ndeemed to extend to any prior or subsequent default, misrepresentation or breach
\nof warranty or covenant hereunder or affect in any way any rights arising by
\nvirtue of any prior or subsequent such occurrence.<\/p>\n
9.10 SEVERABILITY. Any term or provision of this Agreement that is
\ninvalid or unenforceable in any situation in any jurisdiction shall not affect
\nthe validity or enforceability of the remaining terms and provisions hereof or
\nthe validity or enforceability of the offending term or provision in any other
\nsituation or in any other jurisdiction. If the final judgment of a court of
\ncompetent jurisdiction declares that any term or provision hereof is invalid or
\nunenforceable, the Parties agree that the court making the determination of
\ninvalidity or unenforceability shall have the power to limit the term or
\nprovision, to delete specific words or phrases, or to replace any invalid or
\nunenforceable term or provision with a term or provision that is valid and
\nenforceable and that comes closest to expressing the intention of the invalid or
\nunenforceable term or provision, and this Agreement shall be enforceable as so
\nmodified.<\/p>\n
9.11 SUBMISSION TO JURISDICTION. Each of the Parties (a) submits to the
\njurisdiction of any state or federal court sitting in Nevada in any action or
\nproceeding arising out of or relating to this Agreement, (b) agrees that all
\nclaims in respect of such action or proceeding may be heard and determined in
\nany such court, and (c) agrees not to bring any action or proceeding arising out
\nof or relating to this Agreement in any other court. Each of the Parties waives
\nany defense of inconvenient forum to the maintenance of any action or proceeding
\nso brought and waives any bond, surety or other security that might be required
\nof any other Party with respect thereto. Any Party may make service on another
\nParty by sending or delivering a copy of the process to the Party to be served
\nat the address and in the manner provided for the giving of notices in SECTION
\n9.7. Nothing in this SECTION 9.11, however, shall affect the right of any Party
\nto serve legal process in any other manner permitted by law.<\/p>\n
9.12 STANDSTILL. NRI (or any of its officers, directors, employees,
\naffiliates or agents) will not, directly or indirectly, effect the purchase or
\nsale of any security of PurchasePro until the later of (i) the date on which
\nthis Agreement is terminated and (ii) the Merger is consummated.<\/p>\n
9.13 CONSTRUCTION.<\/p>\n
(a) The language used in this Agreement shall be deemed to be
\nthe language chosen by the Parties to express their mutual intent, and no rule
\nof strict construction shall be applied against any Party.<\/p>\n
(b) Any reference to any federal, state, local or foreign
\nstatute or law shall be deemed also to refer to all rules and regulations
\npromulgated thereunder, unless the context requires otherwise.<\/p>\n
40<\/p>\n
9.14 FURTHER ASSURANCES. Each party agrees to cooperate fully with the
\nother parties and to execute such further instruments, documents and agreements
\nand to give such further written assurances as may be reasonably requested by
\nany other party to evidence and reflect the transactions described herein and
\ncontemplated hereby and to carry into effect the intents and purposes of this
\nAgreement.<\/p>\n
9.15 CONFIDENTIALITY. PurchasePro and NRI recognize that they have
\nreceived confidential information concerning the others during the course of the
\nMerger negotiations and preparations. Accordingly, each of the parties hereto
\n(a) represents that it has not permitted the unauthorized disclosure of any
\nconfidential information concerning the other parties hereto that was disclosed
\nduring the course of such negotiations and preparations and was clearly
\ndesignated in writing as confidential at the time of disclosure and (b) agrees
\nto not make use of or permit to be used any such confidential information other
\nthan for the purpose of effectuating the Merger and related transactions. The
\nobligations of PurchasePro under this SECTION 9.15 will terminate upon the
\nEffective Time. Otherwise, the obligations under this SECTION 9.15 will not
\napply to information that (i) is or becomes part of the public domain, (ii) is
\ndisclosed by the disclosing party to third parties without restrictions on
\ndisclosure, (iii) is received by the receiving party from a third party without
\nbreach of a nondisclosure obligation to the other party, or (iv) is required to
\nbe disclosed by subpoena or by law. If this Agreement is terminated, all copies
\nof documents containing confidential information shall be returned by the
\nreceiving party to the disclosing party.<\/p>\n
9.16 EXPENSE. Except as otherwise provided in this Agreement, NRI, for
\nitself, and on behalf of the NRI Common Shareholders, and PurchasePro shall pay
\ntheir own expenses and costs incidental to the preparation of this Agreement and
\nto the consummation of the transactions contemplated hereby.<\/p>\n
[Remainder of This Page Intentionally Left Blank]<\/p>\n
41<\/p>\n
IN WITNESS WHEREOF, the Parties have executed this Agreement as of
\nMarch 5, 2001.<\/p>\n
PURCHASEPRO.COM, INC.<\/p>\n
By: \/s\/ Shawn P. McGhee
\n ————————————-
\n Name: Shawn P. McGhee
\n ————————————-
\n Title: President and Chief Operating Officer
\n ————————————-<\/p>\n
NRI MERGER CORPORATION<\/p>\n
By: \/s\/ Scott E. Wiegand
\n ————————————-
\n Name: Scott E. Wiegand
\n ————————————-
\n Title: President
\n ————————————-<\/p>\n
NET RESEARCH, INC. (D\/B\/A BAYBUILDER)<\/p>\n
By: \/s\/ Abu M. Rahman
\n ————————————-
\n Name: Abu M. Rahman
\n Title: President<\/p>\n
PRINCIPAL SHAREHOLDER<\/p>\n
\/s\/ Abu M. Rahman
\n ———————————————
\n Abu M. Rahman<\/p>\n
[Signature Page to Agreement and Plan of Reorganization]<\/p>\n
DISCLOSURE SCHEDULE<\/p>\n
[See Attached]<\/p>\n
EXHIBIT A<\/p>\n
ESCROW AGREEMENT<\/p>\n
[See Attached]<\/p>\n
EXHIBIT B<\/p>\n
SHAREHOLDER REPRESENTATIVE AGREEMENT<\/p>\n
[See Attached]<\/p>\n
EXHIBIT C<\/p>\n
INVESTMENT REPRESENTATION LETTER<\/p>\n
[See Attached]<\/p>\n
EXHIBIT D<\/p>\n
REGISTRATION RIGHTS AGREEMENT<\/p>\n
[See Attached]<\/p>\n
EXHIBIT E<\/p>\n
NRI CERTIFICATE<\/p>\n
[See Attached]<\/p>\n
EXHIBIT F<\/p>\n
OPINION OF COUNSEL TO NRI<\/p>\n
[See Attached]<\/p>\n
EXHIBIT G<\/p>\n
NRI SECRETARY CERTIFICATE<\/p>\n
[See Attached]<\/p>\n
EXHIBIT H<\/p>\n
EMPLOYMENT AGREEMENT<\/p>\n
[See Attached]<\/p>\n
EXHIBIT I<\/p>\n
SHAREHOLDER WAIVER AGREEMENT<\/p>\n
[See Attached]<\/p>\n
EXHIBIT J<\/p>\n
EMPLOYEE PROPRIETARY INFORMATION AND INVENTIONS AGREEMENT<\/p>\n
[See Attached]<\/p>\n
EXHIBIT K<\/p>\n
PURCHASEPRO CERTIFICATE<\/p>\n
[See Attached]<\/p>\n
EXHIBIT L<\/p>\n
PURCHASEPRO SECRETARY CERTIFICATE<\/p>\n
[See Attached]<\/p>\n
EXHIBIT M<\/p>\n
OPINION OF COUNSEL TO PURCHASEPRO<\/p>\n
[See Attached]<\/p>\n","protected":false},"template":"","meta":{"_acf_changed":false,"_stopmodifiedupdate":true,"_modified_date":"","_cloudinary_featured_overwrite":false},"corporate_contracts_companies":[8609],"corporate_contracts_industries":[],"corporate_contracts_types":[9622,9626],"class_list":["post-43204","corporate_contracts","type-corporate_contracts","status-publish","hentry","corporate_contracts_companies-purchaseprocom-inc","corporate_contracts_types-planning","corporate_contracts_types-planning__merger"],"acf":[],"_links":{"self":[{"href":"https:\/\/corporate.findlaw.com\/legal-api\/wp-json\/wp\/v2\/corporate_contracts\/43204","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/corporate.findlaw.com\/legal-api\/wp-json\/wp\/v2\/corporate_contracts"}],"about":[{"href":"https:\/\/corporate.findlaw.com\/legal-api\/wp-json\/wp\/v2\/types\/corporate_contracts"}],"wp:attachment":[{"href":"https:\/\/corporate.findlaw.com\/legal-api\/wp-json\/wp\/v2\/media?parent=43204"}],"wp:term":[{"taxonomy":"corporate_contracts_companies","embeddable":true,"href":"https:\/\/corporate.findlaw.com\/legal-api\/wp-json\/wp\/v2\/corporate_contracts_companies?post=43204"},{"taxonomy":"corporate_contracts_industries","embeddable":true,"href":"https:\/\/corporate.findlaw.com\/legal-api\/wp-json\/wp\/v2\/corporate_contracts_industries?post=43204"},{"taxonomy":"corporate_contracts_types","embeddable":true,"href":"https:\/\/corporate.findlaw.com\/legal-api\/wp-json\/wp\/v2\/corporate_contracts_types?post=43204"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}