-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, CrmG5DxrCBYHwU8LJntIzj5tr/HbsDflJGAyKBIzxcigOwK2XFMJ8mQmg4coDuaH SqbmX2xeZ3uI+tH/sGaI1w== 0000911420-01-500061.txt : 20010816 0000911420-01-500061.hdr.sgml : 20010816 ACCESSION NUMBER: 0000911420-01-500061 CONFORMED SUBMISSION TYPE: 8-K PUBLIC DOCUMENT COUNT: 11 CONFORMED PERIOD OF REPORT: 20010731 ITEM INFORMATION: Acquisition or disposition of assets ITEM INFORMATION: Financial statements and exhibits FILED AS OF DATE: 20010815 FILER: COMPANY DATA: COMPANY CONFORMED NAME: MONSTERDAATA COM INC CENTRAL INDEX KEY: 0000783454 STANDARD INDUSTRIAL CLASSIFICATION: SERVICES-COMPUTER PROCESSING & DATA PREPARATION [7374] IRS NUMBER: 222732163 STATE OF INCORPORATION: DE FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 8-K SEC ACT: 1934 Act SEC FILE NUMBER: 033-01599 FILM NUMBER: 1714785 BUSINESS ADDRESS: STREET 1: 115 STEVENS AVE CITY: VALHALLA STATE: NY ZIP: 10595 BUSINESS PHONE: 9147479100 MAIL ADDRESS: STREET 1: 115 STEVENS AVE CITY: VALHALLA STATE: NY ZIP: 10595 FORMER COMPANY: FORMER CONFORMED NAME: D-VINE LTD DATE OF NAME CHANGE: 19960522 FORMER COMPANY: FORMER CONFORMED NAME: TRANS WEST INC DATE OF NAME CHANGE: 19960522 8-K 1 d762259.txt CURRENT REPORT SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM 8-K CURRENT REPORT Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934 Date of Report (Date of earliest event reported): July 31, 2001 ------------- MONSTERDAATA, INC. ---------------------------------- (Exact name of registrant as specified in its charter) Delaware 33-1599 22-2732163 - ---------------------------------- ---------------- ---------- (State or other jurisdiction (Commission (I.R.S. Employer of incorporation) File Number) Identification No.) 32 East 31st Street, 9th Floor, New York, New York 10016 - ----------------------------------------------------- ----------------- (Address of principal executive offices) (Zip Code) Registrant's telephone number, including area code: (212) 447-2000 -------------- CURRENT REPORT ON FORM 8-K MONSTERDAATA, INC. July 31, 2001 Item 2. Acquisition or Disposition of Assets ------------------------------------ (a) On July 20, 2001, MonsterDaata, Inc., a Delaware corporation ("MonsterDaata"), NeighborhoodFind.com LLC, a Delaware limited liability company ("NeighborhoodFind"), and all of the holders of outstanding membership interests in NeighborhoodFind entered into an Agreement and Plan of Merger (the "Merger Agreement"). Avalon Equity Partners, L.P., a Delaware limited partnership, controls NeighborhoodFind through its direct ownership of approximately 93.09% of the outstanding membership interests in NeighborhoodFind. On July 31, 2001, pursuant to the Merger Agreement, NeighborhoodFind was merged with and into MonsterDaata under Delaware law (the "Merger"), in return for which MonsterDaata issued to the former holders of membership interests in NeighborhoodFind, in the aggregate, (1) 590,259 shares of Common Stock, par value $.01 per share, of MonsterDaata (the "Common Stock), (2) 297,262 shares of Series D Convertible Preferred Stock, par value $.01 per share, of MonsterDaata (the "Series D Preferred Stock"), initially convertible into 2,378,095 shares of Common Stock, and (3) two-year warrants to purchase 2,147,940 shares of Common Stock (the "Warrants"). MonsterDaata also agreed to issue additional shares of Common Stock and Series D Preferred Stock to the holder formers of membership interests in NeighborhoodFind if, as of July 31, 2003, the current market value of the Common Stock is not equal to or greater than $0.75 per share, calculated to be the product of the difference between $0.75 and the current market value of the Common Stock as of such date and the number of shares of Common Stock or Series D Preferred Stock, as applicable, issuable to the members, but in no event, in the aggregate, more than 500,000 shares of Common Stock and 500,000 shares of Series D Preferred Stock. Of the securities issued to the former holders of membership interests in NeighborhoodFind, certificates evidencing 88,538 shares of Common Stock and 44,589 shares of Series D Preferred Stock, initially convertible into 356,714 shares of Common Stock, were deposited into an escrow account for not less than one year in order to provide a fund for the partial satisfaction of any indemnification obligations of NeighborhoodFind or the former holders of its membership interests as a result of breaches of their respective representations and warranties in the Merger Agreement. In addition, pursuant to the Merger Agreement, MonsterDaata agreed to assume an aggregate of $1,180,000 in principal payments as the successor by merger to NeighborhoodFind, under a Loan Agreement, dated as of June 13, 2000, as amended (the "Loan Agreement"), between NeighborhoodFind and Commerce Capital, L.P., a Tennessee limited partnership ("Commerce Capital"). 2 The consideration for the merger was based upon negotiations among the parties. The transactions contemplated by the Merger Agreement are anticipated to result in the former holders of membership interests in NeighborhoodFind owning approximately 22.48% of the fully-diluted share capital of MonsterDaata. In the Merger Agreement, MonsterDaata also agreed to reserve stock options to purchase up to 1,283,576 shares of Common Stock to be granted to the former officers, managers and employees of NeighborhoodFind as a replacement for similar NeighborhoodFind equity rights. The Merger Agreement, as amended, is filed as Exhibits 2.1 and 2.2 to this Current Report on Form 8-K. The form of Warrants is filed as Exhibit 10.1 to this Current Report on Form 8-K. Any description of the Merger Agreement or the Warrants contained herein is qualified in its entirety by reference to such Exhibits, respectively. The Series D Preferred Stock issued in the Merger is senior to the Common Stock and on a parity with the Series C Convertible Preferred Stock, par value $.01 per share, of MonsterDaata (the "Series C Preferred Stock") as to dividends and upon the dissolution, liquidation or winding-up of MonsterDaata. In the event of any liquidation, dissolution or winding-up of MonsterDaata, the holders of shares of Series D Preferred Stock will receive, prior to any distribution to holders of shares of Common Stock, a distribution in the amount of $20.00 per share (two times its face value) (the "Liquidation Preference"), plus any accrued and unpaid dividends. Holders of Series D Preferred Stock are entitled to receive a cumulative dividend at an annual rate of 7% of the Liquidation Preference, in cash or in additional shares. The Series D Preferred Stock is convertible, at the holder's option, at any time into the number of shares of Common Stock determined by dividing the face value of the Series D Preferred Stock ($10.00) by the conversion price ($1.25), or initially into eight shares of Common Stock. The Series D Preferred Stock is automatically convertible into shares of Common Stock on the same basis upon (1) a public offering of the Common Stock raising gross proceeds in excess of $20.0 million or (2) the completion of a private placement of Common Stock raising gross proceeds in excess of $20.0 million, in each case at a per share price in excess of $10.00. The Series D Preferred Stock is also automatically convertible into Common Stock at such time as the closing price of the Common Stock has traded at more than $10.00 per share for a period of 20 consecutive trading days. Assuming no anti-dilution adjustment (as described below), the Series D Preferred Stock issued in connection with the Merger would be convertible into an aggregate of 2,378,095 shares of Common Stock. In the event MonsterDaata issues any shares of Common Stock, preferred stock, stock options, warrants or other convertible securities at a price of less than $1.25 per share, the conversion price will be automatically adjusted to such lower price. The Series D Preferred Stock will vote as one class with the Series C Preferred Stock and the Common Stock on all matters submitted to a vote of the stockholders of MonsterDaata. Each share of Series D Preferred Stock shall have the same number of votes as the Common Stock 3 into which it is then convertible. The holders of Series D Preferred Stock have the right to designate one member to MonsterDaata's Board of Directors. A copy of the Certificate of Designation, Preferences and Rights of the Series D Preferred Stock is filed as Exhibit 3.1 to this Current Report on Form 8-K, and any description of the Series D Preferred Stock contained herein is qualified in its entirety by reference to such Exhibit. Prior to July 31, 2002, the former holders of membership interests in NeighborhoodFind have agreed not to sell, transfer or otherwise dispose of the MonsterDaata securities received in the Merger. Pursuant to a Registration Rights Agreement, MonsterDaata agreed to file a registration statement under the Securities Act of 1933, as amended, relating to the Common Stock received or to be received upon conversion of the Series D Preferred Stock or exercise of the Warrants by the former holders of membership interests in NeighborhoodFind within six months after the closing of the Merger. MonsterDaata will use its best efforts to keep such registration statement effective for at least 18 months thereafter. Pursuant to an Assumption and Amendment Agreement, dated as of July 31, 2001 (the "Assumption Agreement"), between MonsterDaata and Commerce Capital, MonsterDaata assumed all obligations as successor by merger to NeighborhoodFind under the Loan Agreement. MonsterDaata's indebtedness under the Loan Agreement is evidenced by a Consolidated and Restated Secured Promissory Note in the principal amount of $1,180,000 bearing interest at a rate of 8.0% per annum. Interest only is payable monthly in arrears on the first day of each month beginning August 1, 2001, and the entire outstanding principal balance, together with all accrued and unpaid interest, becomes due and payable on June 1, 2005. The obligations of MonsterDaata under the new Note are secured by a first priority security interest in all of the assets of MonsterDaata. The Assumption Agreement is filed as Exhibit 10.2 and the Loan Agreement, as amended, is filed as Exhibits 10.4 and 10.5 to this Current Report on Form 8-K. Any description of the Assumption Agreement or Loan Agreement contained herein is qualified in its entirety by reference to such Exhibits. NeighborhoodFind, based in Charlottesville, Virginia, provides a website that serves as a community resource, neighborhood communications tool and relocation solution. With more than 19,000 cities online, the site includes thousands of U.S. neighborhoods and serves as a one-stop resource for community information. The site offers neighborhood details, photos and communication tools, including Neighborhood News(R), Community Calendar, Local Government News, free websites, local school and business information, and relocation services. There is no intent to change the nature of the business to which NeighborhoodFind's assets 4 (including plant, equipment or other physical property) are being used. NeighborhoodFind had no material relationship or association with MonsterDaata prior to the Merger. Item 7. Financial Statements, Pro Forma Financial Information and Exhibits (a) Financial Statements of Businesses Acquired. In accordance with Item 7(a), the financial statements of NeighborhoodFind will be filed with the Securities and Exchange Commission as soon as practicable, but in any event not later than 60 days after the date this Current Report on Form 8-K must be filed. (b) Pro Forma Financial Information. In accordance with Item 7(b), the pro forma financial information will be filed with the Securities and Exchange Commission as soon as practicable, but in any event not later than 60 days after the date this Current Report on Form 8-K must be filed. (c) Exhibits. 2.1 Agreement and Plan of Merger, dated June 20, 2001, by and among MonsterDaata, NeighborhoodFind and the members of NeighborhoodFind. 2.2 Amendment No. 1 to Agreement and Plan of Merger, dated July 31, 2001, by and among MonsterDaata, NeighborhoodFind and the members of NeighborhoodFind. 3.1 Certificate of Designation, Preferences and Rights of 7% Series D Convertible Preferred Stock of MonsterDaata. 10.1 Form of Warrants to purchase shares of common stock of MonsterDaata. 10.2 Assumption and Amendment Agreement, dated as of July 31, 2001, between MonsterDaata and Commerce Capital. 10.3 Consolidated and Restated Secured Promissory Note, dated July 31, 2001, of MonsterDaata in the principal amount of $1,180,000. 10.4 Loan Agreement, dated as of June 13, 2000, by and between NeighborhoodFind and Commerce Capital. 10.5 Amendment No. 1 to Loan Agreement, dated as of November 13, 2000, by and between NeighborhoodFind and Commerce Capital. 5 99.1 Press Release issued by MonsterDaata on August 1, 2001. 99.2 Press Release issued by MonsterDaata on July 24, 2001. 6 SIGNATURES Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized. MONSTERDAATA, INC. Dated: August 15, 2001 By:/s/ Samuel B. Petteway, Jr. -------------------------------- Samuel B. Petteway, Jr. President and Chief Executive Officer 7 EXHIBIT INDEX Exhibit Number 2.1 Agreement and Plan of Merger, dated June 20, 2001, by and among MonsterDaata, NeighborhoodFind and the members of NeighborhoodFind. 2.2 Amendment No. 1 to Agreement and Plan of Merger, dated July 31, 2001, by and among MonsterDaata, NeighborhoodFind and the members of NeighborhoodFind. 3.1 Certificate of Designation, Preferences and Rights of 7% Series D Convertible Preferred Stock of MonsterDaata. 10.1 Form of Warrants to purchase shares of common stock of MonsterDaata. 10.2 Assumption and Amendment Agreement, dated as of July 31, 2001, between MonsterDaata and Commerce Capital. 10.3 Consolidated and Restated Secured Promissory Note, dated July 31, 2001, of MonsterDaata in the principal amount of $1,180,000. 10.4 Loan Agreement, dated as of June 13, 2000, by and between NeighborhoodFind and Commerce Capital. 10.5 Amendment No. 1 to Loan Agreement, dated as of November 13, 2000, by and between NeighborhoodFind and Commerce Capital. 99.1 Press Release issued by MonsterDaata on August 1, 2001. 99.2 Press Release issued by MonsterDaata on July 24, 2001. 8 EX-2 4 e727221.txt EXHIBIT 2.1 Exhibit 2.1 ================================================================================ AGREEMENT AND PLAN OF MERGER by and among MONSTERDAATA, INC., NEIGHBORHOODFIND.COM LLC and THE MEMBERS OF NEIGHBORHOODFIND.COM LLC July 20, 2001 ================================================================================ TABLE OF CONTENTS Page No. 1. The Merger.........................................................1 1.1 Merger.............................................................1 1.2 Effective Time.....................................................2 1.3 Certificate of Incorporation, Bylaws, Directors and Officers.......2 1.4 Assets and Liabilities.............................................2 1.5 Manner and Basis of Converting Shares..............................3 1.6 Additional Consideration...........................................3 1.7 Surrender and Exchange of Certificates.............................4 1.8 NeighborhoodFind Options and Warrants..............................4 1.9 Assumption of Commerce Capital Notes...............................4 1.10 NeighborhoodFind Employee Stock Options............................5 1.11 Further Assurances.................................................5 1.12 Shareholder Representative.........................................5 2. Representations and Warranties of NeighborhoodFind.................6 2.1 Organization, Standing, etc........................................6 2.2 Qualification......................................................6 2.3 Membership Interests...............................................6 2.4 Indebtedness.......................................................7 2.5 NeighborhoodFind Members...........................................7 2.6 Acts and Proceedings...............................................7 2.7 Compliance with Laws and Instruments...............................7 2.8 Binding Obligations................................................8 2.9 No Brokers or Finders..............................................8 2.10 Financial Statements...............................................8 2.11 Absence of Undisclosed Liabilities.................................8 2.12 Changes............................................................8 2.13 Schedule of Assets and Contracts...................................9 2.14 Employees.........................................................11 2.15 Tax Returns and Audits............................................11 2.16 Patents and Other Intangible Assets...............................12 2.17 Employee Benefit Plans; ERISA.....................................12 2.18 Title to Property and Encumbrances................................13 2.19 Condition of Properties...........................................14 2.20 Insurance Coverage................................................14 2.21 Litigation........................................................14 2.22 Licenses..........................................................14 2.23. Internal Software Applications....................................14 2.23 Interested Party Transactions.....................................15 2.25 Receivables.......................................................16 i 2.26 Customers, Suppliers and Independent Contractors..................16 2.30 Obligations to or by Members......................................16 2.33 Disclosure........................................................16 3. Representations and Warranties of MonsterDaata....................17 3.1 Organization and Standing.........................................17 3.2 Corporate Authority...............................................17 3.3 Broker's Fees.....................................................17 3.4 Capitalization of MonsterDaata....................................17 3.5 Validity of Shares................................................17 3.6 Information.......................................................18 3.7 Financial Statements..............................................18 3.8 Governmental Consents.............................................18 3.9 Compliance with Laws and Instruments..............................18 3.10 Indebtedness......................................................19 3.11 MonsterDaata Stockholders.........................................19 3.12 Absence of Undisclosed Liabilities................................19 3.13 Employees.........................................................19 3.14 Tax Returns and Audits............................................19 3.15 Title to Property and Encumbrances................................20 3.16 Litigation........................................................20 3.16 Licenses..........................................................20 3.17 No General Solicitation...........................................20 3.18 Disclosure........................................................20 4. Additional Representations, Warranties and Covenants of the Members...........................................................21 4.1 Acts and Proceedings..............................................21 4.2 Compliance with Laws and Instruments..............................21 4.3 Binding Obligation................................................21 4.4 Title to Interests................................................21 4.5 Information.......................................................21 4.6 Resale of Stock...................................................21 4.7 Members Representation............................................22 5. Conduct of Businesses Pending the Merger..........................22 5.1 Conduct of Business by NeighborhoodFind Pending the Merger........22 5.2 Conduct of Business by MonsterDaata Pending the Merger............23 6. Additional Agreements.............................................24 6.1 Access and Information............................................24 6.2 Additional Agreements.............................................24 6.3 Publicity.........................................................25 6.4 MonsterDaata Director and Observer Designee.......................25 6.6 Executive Employment Agreement....................................25 6.7 Registration Rights...............................................25 ii 6.8 Lock-Up Letters...................................................25 6.9 Cancellation of NeighborhoodFind Equity Rights....................26 6.10 Auditor's Consent.................................................26 7. Conditions of Parties' Obligations................................26 7.1 Conditions of MonsterDaata Obligations............................26 7.2 Conditions of NeighborhoodFind's Obligations......................28 8. Nature and Survival of Representations and Warranties and Indemnification...................................................30 8.1 Nature and Survival...............................................30 8.2 Member Indemnification............................................30 8.3 Escrow Fund.......................................................31 8.4 MonsterDaata Indemnification......................................32 9. Amendment of Agreement............................................33 10. Definitions.......................................................33 11. Closing...........................................................37 13. Miscellaneous.....................................................39 13.2 Notices...........................................................39 13.3 Entire Agreement..................................................39 13.4 Expenses..........................................................40 13.5 Time..............................................................40 13.6 Severability......................................................40 13.7 Successors and Assigns............................................40 13.8 No Third Parties Benefited........................................40 13.9 Counterparts......................................................40 13.10 Recitals, Schedules and Exhibits..................................40 13.11 Section Headings and Gender.......................................40 13.12 Governing Law.....................................................40 iii LIST OF ANNEXES A Certificate of Merger B MonsterDaata Certificate of Incorporation C MonsterDaata By-laws D Certificate of Designation for Series D Preferred Stock E [Intentionally Omitted] F Registration Rights Agreement G Lock-Up Letter H Escrow Agreement 1.6 Make-Whole Consideration Examples 2.5 NeighborhoodFind Members 2.10 NeighborhoodFind Financial Statements 2.11 Undisclosed Liabilities 2.12 Changes 2.13(1) Schedule of Leased Real and Personal Property 2.13(2) Material Agreements 2.13(3) Schedule of Accounts 2.13(4) Schedule of Agreements 2.13(5) Schedule of Patents and Other Intangible Assets 2.14 Employees 2.17 Schedule of Employee Benefits Plans 2.21 Litigation 2.22 Licenses 2.23 Internal Software Applications 2.24 Interested Party Transactions 2.25 Receivables 2.27 Product Warranties 3.4 MonsterDaata Options, Warrants and Convertible Securities 3.11 MonsterDaata Stockholders 7.1(f) Form of Opinion of NeighborhoodFind and Members' Counsel 7.2(e) Form of Opinion of MonsterDaata Counsel iv AGREEMENT AND PLAN OF MERGER THIS AGREEMENT AND PLAN OF MERGER is made and entered into on July 20, 2001, by and among MONSTERDAATA, INC., a Delaware corporation ("MonsterDaata"), NEIGHBORHOODFIND.COM LLC, a Delaware limited liability company ("NeighborhoodFind"), and the members of NeighborhoodFind whose names appear on the signature page hereof (collectively, the "Members"). W I T N E S S E T H: WHEREAS, the Board of Directors of MonsterDaata and the managers of NeighborhoodFind have determined that it is fair to and in the best interests of their respective business entities and owners for NeighborhoodFind to be merged with and into MonsterDaata upon the terms and subject to the conditions set forth herein; WHEREAS, the Board of Directors of MonsterDaata and the managers of NeighborhoodFind have approved the merger of NeighborhoodFind with and into MonsterDaata in accordance with the General Corporation Law of the State of Delaware ("Corporation Law") and the Limited Liability Company Act of the State of Delaware ("LLC Act"), respectively, and upon the terms and subject to the conditions set forth herein and in the Certificate of Merger (the "Certificate of Merger") attached hereto as Annex A; WHEREAS, the Members of NeighborhoodFind have unanimously approved this Agreement, the Certificate of Merger and the transactions contemplated hereby and thereby, including the Merger; and WHEREAS, to induce MonsterDaata and NeighborhoodFind to enter into this Agreement and the Certificate of Merger, the Members have agreed to become parties to this Agreement and to make the covenants, representations and warranties indicated herein. NOW, THEREFORE, in consideration of the mutual agreements and covenants hereinafter set forth, the parties hereto agree as follows: 1. The Merger. 1.1 Merger. Subject to the terms and conditions of this Agreement and the Certificate of Merger, NeighborhoodFind shall be merged with and into MonsterDaata (the "Merger") in accordance with Section 264 of the Corporation Law and Section 18-209 of the LLC Act. At the Effective Time, the separate legal existence of NeighborhoodFind shall cease and MonsterDaata shall be the surviving corporation in the Merger (sometimes hereinafter referred to as the "Surviving Corporation") and shall continue its corporate existence under the laws of the State of Delaware. 1.2 Effective Time. The Merger shall become effective on the date and at the time the Certificate of Merger are filed with the Secretary of State of the State of Delaware in accordance with Section 264 of the Corporation Law and Section 18-209 of the LLC Act. The time at which the Merger shall become effective as aforesaid is referred to hereinafter as the "Effective Time," and the filing of the Certificate of Merger as set forth in the first sentence of this Section 1.2 shall be the last action required prior to the Closing as contemplated hereby and as described in Section 11 hereof. 1.3 Certificate of Incorporation, By-laws, Directors and Officers. (a) The Certificate of Incorporation of MonsterDaata, as in effect immediately prior to the Effective Time, attached hereto as Annex B, shall be the Certificate of Incorporation of the Surviving Corporation from and after the Effective Time until further amended in accordance with applicable law. (b) The By-laws of MonsterDaata, as in effect immediately prior to the Effective Time, attached hereto as Annex C, shall be the By-laws of the Surviving Corporation from and after the Effective Time until amended in accordance with applicable law, the Certificate of Incorporation and such By-laws. (c) The directors and officers of MonsterDaata in office immediately prior to the Effective Time shall be the directors and officers of the Surviving Corporation (except for the addition of a director elected by a majority of the holders of the Series D Preferred Stock as contemplated by Section 6.4), and each shall hold his respective office or offices from and after the Effective Time until his successor shall have been elected and shall have qualified or as otherwise provided in the By-laws of the Surviving Corporation. 1.4 Assets and Liabilities. At the Effective Time, the Surviving Corporation shall possess all the rights, privileges, powers and franchises of a public as well as of a private nature, and be subject to all the restrictions, disabilities and duties of each of the constituent business entities; and all and singular, the rights, privileges, powers and franchises of each of the constituent business entities, and all property, real, personal and mixed, and all debts due to any of the constituent business entities on whatever account, as well for stock subscriptions as all other things in action or belonging to each of the constituent business entities shall be vested in the Surviving Corporation; and all property, rights, privileges, powers and franchises, and all and every other interest shall be thereafter as effectively the property of the Surviving Corporation as they were of each of the respective constituent business entities, and the title to any real estate vested by deed or otherwise in any of such constituent business entities shall not revert or be in any way impaired by the Merger; but all rights of creditors and all liens upon any property of any of the constituent business entities shall be preserved unimpaired, and all debts, liabilities and duties of the respective constituent business entities shall thenceforth attach to the Surviving Corporation, and may be enforced against it to the same extent as if said debts, liabilities and duties had been incurred or contracted by it. 2 1.5 Manner and Basis of Converting Interests. (a) At the Effective Time: (i) each share of Common Stock that shall be outstanding immediately prior to the Effective Time shall remain unchanged and continue to be outstanding; (ii) the membership interests of NeighborhoodFind (the "NeighborhoodFind Interests") beneficially owned by the Members listed below, which membership interests constitute all of the issued and outstanding membership interests of NeighborhoodFind, shall, by virtue of the Merger and without any action on the part of the holders thereof, be converted into the right to receive the MonsterDaata Securities specified below (which, in the aggregate, constitutes 25% of the shares of Common Stock outstanding following the Merger on a fully-diluted basis, less 500,000 shares of each of the Common Stock and Series D Preferred Stock, on an as-converted basis):
MonsterDaata Securities (on an as-converted basis into Common Stock ---------------------------------------------------------------------------------------- Membership Interest Shares of Series D Shares of Warrants to in NeighborhoodFind Preferred Stock Common Stock Purchase Common Stock ------------------- --------------- ------------ --------------------- Name Avalon Equity Fund L.P.... 96.06% 2,284,398 567,003 2,329,488 Commerce Capital, L.P..... 3.94% 93,697 23,256 95,546 Total 100.00% 2,378,095 590,259 2,425,034
- ------------------------- (iii) each NeighborhoodFind Interest held in the treasury of NeighborhoodFind immediately prior to the Effective Time shall be cancelled in the Merger and cease to exist. (b) After the Effective Time, there shall be no further registration of transfers on the stock transfer books of the Surviving Corporation of the NeighborhoodFind Interests that were outstanding immediately prior to the Effective Time. 1.6 Make-Whole Consideration. If, as of the second anniversary of the Closing Date (the "Target Date"), the Current Market Value of the Common Stock is not equal to or greater than $0.75 per share (the "Target Price"), MonsterDaata shall issue to each Member (or, at MonsterDaata's election, pay to each Member an amount of cash with equivalent value) (a) with respect to the Common Stock, a number of additional shares of Common Stock equal to the product of (i) the difference between the Target Price and the Current Market Value of Common Stock as of the Target Date and (ii) the number of shares of Common Stock issuable to such Member pursuant to Section 1.5(a)(ii), and (b) with respect to the Series D Preferred Stock, a number of additional shares of Series D Preferred Stock equal to the product of (i) the difference between the Target Price and the Current Market Value of the Common Stock as of the Target Date and (ii) the number of shares of Series D Preferred Stock issuable to such Member pursuant to Section 1.5(a)(ii); provided, however, that MonsterDaata shall not be 3 obligated under this Section 1.6 to issue to the Members, in the aggregate, more than 500,000 additional shares of Common Stock pursuant to clause (a) above or 500,000 additional shares of Series D Preferred Stock (on an as-converted basis into Common Stock) pursuant to clause (b) above. By way of illustration, examples of the foregoing calculations are set forth in Annex 1.6 hereto. 1.7 Cancellation and Exchange of Interests. (a) Immediately after the Effective Time and upon cancellation of all NeighborhoodFind Interests that were outstanding immediately prior to the Effective Time, MonsterDaata shall issue (i) certificates registered in the name of the Escrow Agent or its nominee representing 356,714 shares of Series D Preferred Stock (on an as-converted basis into Common Stock) that they shall be entitled to receive as set forth in Section 1.5(a)(ii) hereof (342,659 of which represents shares to which Avalon Equity Fund L.P. shall be so entitled and 14,055 of which represents shares to which Commerce Capital shall be so entitled) and 88,539 shares of Common Stock that they shall be entitled to receive as set forth in Section 1.5(a)(ii) hereof (85,051 of which represents shares to which Avalon Equity Fund L.P. shall be so entitled and 3,488 of which represents shares to which Commerce Capital shall be so entitled) and (ii) certificates registered in the name of such Member representing the MonsterDaata Securities that such Member shall be entitled to receive as set forth in Section 1.5(a)(ii) hereof (less that number of MonsterDaata Securities registered in the name of the Escrow Agent or its nominee referred to in clause (i) above). Until cancelled as contemplated by this Section 1.7, each certificate that immediately prior to the Effective Time represented any outstanding NeighborhoodFind Interest shall be deemed at and after the Effective Time to represent only the right to receive upon cancellation as aforesaid the consideration specified in Section 1.5(a)(ii) hereof for the holder thereof. (b) The certificates representing the MonsterDaata Securities issued in favor of the Members pursuant to Section 1.5(a)(ii) hereof and referred to in Section 1.7(a)(i) hereof shall be delivered to the Escrow Agent, registered in the name of the Escrow Agent or its nominee, and held in escrow pursuant to the terms of the Escrow Agreement. The certificates for the balance of the MonsterDaata Securities to be issued pursuant to Section 1.5(a)(ii) shall be delivered to the Members at Closing. 1.8 NeighborhoodFind Options and Warrants. All options, warrants and rights to purchase NeighborhoodFind Interests or other Equity Securities outstanding as of the Effective Date (collectively, the "NeighborhoodFind Equity Rights") will be exchanged for MonsterDaata employee stock options as contemplated by Section 1.10 below or part of the warrants to purchase Common Stock to be issued under Section 1.5(a)(ii), prior to or effective upon the Effective Time, and MonsterDaata shall not assume or have any obligation with respect to such options, warrants or rights. 1.9 Amendment of Commerce Capital Notes. At the Effective Time, the promissory notes made by NeighborhoodFind to Commerce Capital, (a) dated June 13, 2000, in the principal amount of $800,000, and (b) dated November 30, 2000, in the principal amount of $380,000 (together, the "Commerce Capital Notes"), shall be amended to, among other things, (i) substitute MonsterDaata as the obligor thereunder in place of NeighborhoodFind and (ii) 4 reduce the current interest rate under the Commerce Capital Notes from 13% per annum to 8% per annum. 1.10 New MonsterDaata Employee Stock Options. At or before the Effective Time, MonsterDaata shall reserve additional stock options to purchase 1,283,576 shares of Common Stock under the MonsterDaata, Inc. 2000 Stock Option Plan, or under a separate stock option plan adopted by MonsterDaata, which may, in the discretion of the Member Representative and with the consent of MonsterDaata (which shall not be unreasonably withheld), be issued to officers, managers and employees of MonsterDaata who are officers, managers or employees of NeighborhoodFind as of the Effective Time, including as a replacement for NeighborhoodFind Equity Rights currently held by such officers, managers and employees. 1.11 Further Assurances. From time to time, from and after the Effective Time, as and when requested by MonsterDaata, and without cost or expense to MonsterDaata, the appropriate officers and managers of NeighborhoodFind as of the Effective Time shall, for and on behalf and in the name of NeighborhoodFind or otherwise, shall execute and deliver all such deeds, bills of sale, assignments and other instruments and shall take or cause to be taken such further actions as MonsterDaata may deem necessary or desirable in order to confirm or record or otherwise transfer to MonsterDaata title to and possession of all of the properties, rights, privileges, powers, franchises and immunities of NeighborhoodFind or otherwise to carry out fully the provisions and purposes of this Agreement and the Certificate of Merger. 1.12 Member Representative. NeighborhoodFind and each Member hereby irrevocably constitute and appoint Avalon Equity Fund L.P. (the "Member Representative"), with full power of substitution and re-substitution, as its and their true and lawful agent, attorney-in-fact and representative (such entity and its appointed and designated successor or successors being herein referred to as the "Member Representative"), with full power to act for and on behalf of NeighborhoodFind and the Members, and each of them, for all purposes under this Agreement and in connection with the Merger including, without limitation, for purposes of: (i) determining the amount of any Damages (as such term is hereinafter defined) suffered or incurred by MonsterDaata and the number of shares and amount of assets held under the Escrow Agreement to be transferred or distributed to MonsterDaata in accordance with the terms of the Escrow Agreement, (ii) determining the amount of Member Damages (as that term is hereinafter defined) suffered or incurred by the Members, (iii) receiving notices from MonsterDaata given under this Agreement, of which the Member Representative will give a copy to the other Members, (iv) approving and agreeing with MonsterDaata as to additions, deletions, changes, modifications and amendments to this Agreement and the Annexes hereto including, without limitation, the Escrow Agreement, except with respect to any addition, deletion, change, modification or amendment to a material financial term or condition of any of such documents that would materially, financially and adversely affect the Members, and (v) settling finally and completely any disputes or controversies among the parties hereto (other than solely among the Members) with respect to the interpretation or effect of or damages or relief under this Agreement and any and all transactions contemplated hereby (including, without limitation, under the Escrow Agreement). The Member Representative shall be entitled to reimbursement by the Members from the consideration actually payable to the Members or 5 otherwise for all reasonable costs and expenses incurred by it in fulfilling its duties hereunder, and the Members agree among themselves that such costs and expenses shall be borne pro rata among them according to the number of membership interests owned immediately prior to the Effective Time. The Members agree that the Member Representative may make reasonable requests for advances to cover such costs and expenses, and the Members will promptly make such advances. In no event will MonsterDaata be liable for any costs or expenses of any nature incurred by the Member Representative in its capacity as such. NEIGHBORHOODFIND AND EACH MEMBER, JOINTLY AND SEVERALLY, AGREE THAT THE MEMBER REPRESENTATIVE SHALL HAVE NO LIABILITY TO THE MEMBERS FOR ACTION TAKEN OR OMITTED IN GOOD FAITH IN EXERCISING THE AUTHORITY GRANTED UNDER THIS SECTION 1.12. MonsterDaata shall not have any obligation or liability to indemnify or defend the Member Representative in respect of any claim or liability asserted against the Member Representative by any Member or its successors or assigns. All determinations, decisions, actions and the like made by the Member Representative shall be final, conclusive and binding upon all Members and all persons claiming under or through them. 2. Representations and Warranties of NeighborhoodFind. NeighborhoodFind represents and warrants to MonsterDaata as follows: 2.1 Organization, Standing, etc. NeighborhoodFind is a limited liability company organized and existing in good standing under the laws of the State of Delaware, and has all requisite power and authority to carry on its business, to own or lease its properties and assets, to enter into this Agreement and the Certificate of Merger and to carry out the terms hereof and thereof. The copy of the Limited Liability Company Agreement of NeighborhoodFind (the "LLC Agreement") that has been delivered to MonsterDaata prior to the execution of this Agreement is true and complete and has not since been amended or repealed. NeighborhoodFind has no subsidiaries or direct or indirect interest (by way of stock ownership or otherwise) in any firm, corporation, limited liability company, partnership, association or business. 2.2 Qualification. NeighborhoodFind is duly qualified to conduct business as a foreign entity and is in good standing in each jurisdiction wherein the nature of its activities or its properties owned or leased makes such qualification necessary, except where the failure to be so qualified would not have a material adverse effect on the condition (financial or otherwise), properties, assets, liabilities, business operations, results of operations or prospects of NeighborhoodFind (hereinafter, the "Condition of NeighborhoodFind"). 2.3 Membership Interests. All issued and outstanding membership interests of NeighborhoodFind are duly authorized, validly issued, fully paid and nonassessable. The offer, issuance and sale of such NeighborhoodFind Interests were (a) exempt from the registration and prospectus delivery requirements of the Securities Act, (b) registered or qualified (or were exempt from registration or qualification) under the registration or qualification requirements of all applicable state securities laws and (c) accomplished in conformity with all other applicable securities laws. None of such NeighborhoodFind Interests are subject to a right of withdrawal or a right of rescission under any federal or state securities or blue sky law. Except as disclosed in Annex 2.5, NeighborhoodFind has no outstanding options, rights or 6 commitments to issue NeighborhoodFind Interests or other Equity Securities and there are no outstanding securities convertible into or exchangeable for NeighborhoodFind Interests or other Equity Securities. 2.4 Indebtedness. NeighborhoodFind has no Indebtedness for Borrowed Money exceptas disclosed on the Balance Sheet. 2.5 NeighborhoodFind Members. Annex 2.5 hereto contains a true and complete list of (a) the names and addresses of the record and beneficial holders of all of the outstanding NeighborhoodFind Interests and other Equity Securities and (b) the names and addresses of the record and beneficial holders of all of the outstanding NeighborhoodFind Equity Rights, together with the number or percentage of securities held. Other than the LLC Agreement, there is no voting trust, agreement or arrangement among any of the beneficial holders of NeighborhoodFind Interests affecting the exercise of the voting rights of such membership interests. 2.6 Acts and Proceedings. The execution, delivery and performance of this Agreement and the Certificate of Merger (together, the "Merger Documentation") have been duly authorized by the "Managers" (as such term is defined in Section 18-101(10) of the LLC Act) of NeighborhoodFind and have been approved by the unanimous vote of the Members, and all of the acts and other proceedings required for the due and valid authorization, execution, delivery and performance of the Merger Documentation and the consummation of the Merger have been validly and appropriately taken, except for the filings referred to in Section 1.2. No Member has requested or will request appraisal rights under Section 18-210 of the LLC Act. 2.7 Compliance with Laws and Instruments. Except as disclosed in Annex 2.7, the and operations of NeighborhoodFind have been and are being conducted in accordance with all applicable laws, rules and regulations, except where the failure to conduct such business and operations in accordance with all applicable laws, rules and regulations would not have a material adverse effect on the Condition of NeighborhoodFind. The execution, delivery and performance by NeighborhoodFind of the Merger Documentation and the consummation by NeighborhoodFind of the transactions contemplated by this Agreement: (a) will not require from the Members any consent or approval that has not already been obtained, (b) will not require any authorization, consent or approval of, or filing or registration with, any court or governmental agency or instrumentality, except such as shall have been obtained prior to the Closing, (c) will not cause NeighborhoodFind to violate or contravene (i) any provision of law, (ii) any rule or regulation of any agency or government, (iii) any order, judgment or decree of any court or (iv) any provision of the LLC Agreement of NeighborhoodFind, (d) will not violate or be in conflict with, result in a breach of or constitute (with or without notice or lapse of time, or both) a default under, any indenture, loan or credit agreement, deed of trust, mortgage, security agreement or other contract, agreement or instrument to which NeighborhoodFind is a party or by which NeighborhoodFind or any of its properties is bound or affected and (e) will not result in the creation or imposition of any Lien upon any property or asset of NeighborhoodFind. NeighborhoodFind is not in violation of, or (with or without notice or lapse of time, or both) in default under, any term or provision of its LLC Agreement. 7 2.8 Binding Obligations. This Agreement constitutes the legal, valid and binding obligation of NeighborhoodFind and is enforceable against NeighborhoodFind in accordance with its terms, except as such enforcement is limited by bankruptcy, insolvency and other similar laws affecting the enforcement of creditors' rights generally and by general principles of equity. Upon the execution and delivery of the Certificate of Merger by NeighborhoodFind and MonsterDaata, the Certificate of Merger will be a legal, valid and binding obligation of NeighborhoodFind and will be enforceable against NeighborhoodFind in accordance with its terms, except as such enforcement is limited by bankruptcy, insolvency and other similar laws affecting the enforcement of creditors' rights generally and by general principles of equity. 2.9 No Brokers or Finders. No Person has, or as a result of the transactions contemplated herein will have, any right or valid claim against NeighborhoodFind, MonsterDaata or any of their respective Affiliates for any commission, fee or other compensation as a finder or broker, or in any similar capacity. 2.10 Financial Statements. Attached hereto as Annex 2.10 are (a) NeighborhoodFind's unaudited balance sheet as at December 31, 2000, and its unaudited statements of income and retained earnings and changes in financial position for the year then ended, and (b) NeighborhoodFind's unaudited balance sheet (the "Balance Sheet") as of May 31, 2001 (the "Balance Sheet Date") and the statements of income and retained earnings and changes in financial position for the five-month period then ended. Such financial statements (i) are in accordance with the books and records of NeighborhoodFind, (ii) present fairly the financial condition of NeighborhoodFind at the dates therein specified and the results of its operations and changes in financial position for the periods therein specified and (iii) have been prepared in accordance with generally accepted accounting principles ("GAAP") applied on a basis consistent with prior accounting periods, except for footnotes and normal year-end adjustments with respect to the Balance Sheet. Except for the execution of its report thereon, the accounting firm of Hantzmon, Wiebel & Company has substantially completed all work necessary for the compilation of NeighborhoodFind's audited balance sheet as at December 31, 2000, and its audited statements of income and retained earnings and changes in financial position for the year then ended. 2.11 Absence of Undisclosed Liabilities. NeighborhoodFind has no material obligation or liability (whether accrued, absolute, contingent, liquidated or otherwise, whether due or to become due), arising out of any transaction entered into at or prior to the Closing, except (a) as disclosed in Annex 2.11 hereto, (b) to the extent set forth on or reserved against in the Balance Sheet, (c) current liabilities incurred and obligations under agreements entered into in the usual and ordinary course of business since the Balance Sheet Date, none of which (individually or in the aggregate) materially and adversely affects the Condition of NeighborhoodFind, and (d) by the specific terms of any written agreement, document or arrangement identified in the Annexes. 2.12 Changes. Since January 1, 2001, except as disclosed in Annex 2.12 hereto, NeighborhoodFind has not (a) incurred any debts, obligations or liabilities, absolute, accrued, contingent or otherwise, whether due or to become due, except current liabilities incurred in the usual and ordinary course of business, none of which (individually or in the 8 aggregate) materially and adversely affects the Condition of NeighborhoodFind, (b) discharged or satisfied any Liens other than those securing, or paid any obligation or liability other than, current liabilities shown on the Balance Sheet and current liabilities incurred since the Balance Sheet Date, in each case in the usual and ordinary course of business, (c) mortgaged, pledged or subjected to Lien any of its assets tangible or intangible, (d) sold, transferred or leased any of its assets, except in the usual and ordinary course of business, (e) cancelled or compromised any debt or claim, or waived or released any right, of material value, (f) suffered any physical damage, destruction or loss (whether or not covered by insurance) adversely affecting the Condition of NeighborhoodFind, (g) entered into any transaction other than in the usual and ordinary course of business, (h) encountered any labor difficulties, (i) made or granted any wage or salary increase or made any increase in the amounts payable under any profit sharing, bonus, deferred compensation, severance pay, insurance, pension, retirement or other employee benefit plan, agreement or arrangement, other than in the ordinary course of business consistent with past practice, or entered into any employment agreement, (j) issued or sold any membership interests, bonds, notes, debentures or other securities or granted any options (including employee stock options), warrants or other rights with respect thereto, (k) declared or paid any dividends on or made any other distributions with respect to, or purchased or redeemed, any of its outstanding equity interests, (l) suffered or experienced any change in, or condition affecting, the Condition of NeighborhoodFind other than changes, events or conditions in the usual and ordinary course of its business, none of which (either by itself or in conjunction with all such other changes, events and conditions) has been materially adverse, (m) made any change in the accounting principles, methods or practices followed by it or depreciation or amortization policies or rates theretofore adopted, (n) made or permitted any amendment or termination of any contract, agreement or license to which it is a party, (o) suffered any material loss not reflected in the Balance Sheet or its statement of income for the twelve months ended on the Balance Sheet Date, (p) paid, or made any accrual or arrangement for payment of, bonuses or special compensation of any kind or any severance or termination pay to any present or former officer, director, employee, shareholder or consultant, (q) made or agreed to make any charitable contributions or incurred any non-business expenses in excess of $5,000 in the aggregate, (r) entered into any agreement, or (s) otherwise obligated itself to do any of the foregoing. 2.13 Schedule of Assets and Contracts. Attached hereto as Annexes 2.13(1) through 2.13(5) are various schedules listing assets and contracts of NeighborhoodFind, as described herein. (a) Annex 2.13(1) contains a true and complete list of all real property leased by NeighborhoodFind, including a brief description of each item thereof and of the nature of NeighborhoodFind's interest therein, and of all tangible personal property owned or leased by NeighborhoodFind having a cost or fair market value of greater than $10,000, including a brief description of each item and of the nature of the interest of NeighborhoodFind therein. All the property listed in Annex 2.13(1) as being leased by NeighborhoodFind is held by NeighborhoodFind under valid and enforceable leases having the rental terms, termination dates and renewal and purchase options described in Annex 2.13(1); such leases are enforceable in accordance with their terms, and there is not, under any such lease, any existing default or event of default or event which with notice or lapse of time, or both, would constitute a default, and NeighborhoodFind has not received any notice or claim of any such default. NeighborhoodFind does not now own, nor has it at any time owned, any real property. 9 (b) Except as expressly set forth in this Agreement, the Balance Sheet or the notes thereto, or as disclosed in Annex 2.13(2) hereto, NeighborhoodFind is not a party to any written or oral agreement not made in the ordinary course of business. Except as disclosed in Annex 2.13(2) hereto, NeighborhoodFind is not a party to or otherwise barred by any written or oral (a) agreement with any labor union, (b) agreement for the purchase of fixed assets or for the purchase of materials, supplies or equipment in excess of normal operating requirements, (c) agreement for the employment of any officer, individual employee or other Person on a full-time basis or any agreement with any Person for consulting services, (d) bonus, pension, profit sharing, retirement, stock purchase, stock option, deferred compensation, medical, hospitalization or life insurance or similar plan, contract or understanding with respect to any or all of the employees of NeighborhoodFind or any other Person, (e) indenture, loan or credit agreement, note agreement, deed of trust, mortgage, security agreement, promissory note or other agreement or instrument relating to or evidencing Indebtedness for Borrowed Money or subjecting any asset or property of NeighborhoodFind to any Lien or evidencing any Indebtedness, (f) guaranty of any Indebtedness, (g) other than as set forth in Annex 2.13(1) hereto, lease or agreement under which NeighborhoodFind is lessee of or holds or operates any property, real or personal, owned by any other Person under which payments to such Person exceed $20,000 per year or with an unexpired term (including any period covered by an option to renew exercisable by any other party) of more than 30 days, (h) lease or agreement under which NeighborhoodFind is lessor or permits any Person to hold or operate any property, real or personal, owned or controlled by NeighborhoodFind, (i) agreement granting any preemptive right, right of first refusal or similar right to any Person, (j) agreement or arrangement with any Affiliate or any "associate" (as such term is defined in Rule 405 under the Securities Act) of NeighborhoodFind or any present or former officer, manager or member of NeighborhoodFind, (k) agreement obligating NeighborhoodFind to pay any royalty or similar charge for the use or exploitation of any tangible or intangible property, (1) covenant not to compete or other restriction on its ability to conduct a business or engage in any other activity, (m) distributor, dealer, manufacturer's representative, sales agency, franchise or advertising contract or commitment, (n) agreement to register securities under the Securities Act, (o) collective bargaining agreement, or (p) agreement or other commitment or arrangement with any Person continuing for a period of more than three months from the Closing Date which involves an expenditure or receipt by NeighborhoodFind in excess of $20,000. Except as disclosed in Annex 2.13(2), none of the agreements, contracts, leases, instruments or other documents or arrangements listed on Annexes 2.13(1) through 2.13(5) requires the consent of any of the parties thereto other than NeighborhoodFind to permit the contract, agreement, lease, instrument or other document or arrangement to remain effective following consummation of the Merger and the transactions contemplated hereby. (c) Annex 2.13(3) contains a true and complete list and description of all insurance policies and insurance coverage with respect to NeighborhoodFind, its business, premises, properties, assets, employees and agents including, without limitation, fire and casualty insurance, property and liability insurance, product liability insurance, life insurance, medical and hospital insurance and workers' compensation insurance; such list includes with respect to each policy (i) a general description of the insured loss coverage, (ii) the expiration date of coverage, (iii) the annual premium, and (iv) the dollar limitations of coverage and a general description of each deductible feature. 10 (d) Annex 2.13(4) contains a true and complete list and description of each bank account, savings account, other deposit relationship and safety deposit box of NeighborhoodFind, including the name of the bank or other depository, the account number and the names of the individuals having signature or other withdrawal authority with respect thereto. (e) Annex 2.13(5) contains a true and complete list of all patents, patent applications, trade names, trademarks, trademark registrations and applications, copyrights, copyright registrations and applications, and grants of licenses, both domestic and foreign, presently owned, possessed, used or held by NeighborhoodFind; and NeighborhoodFind owns the entire right, title and interest in and to the same, free and clear of all Liens and restrictions. Annex 2.13(5) also contains a true and complete list of all licenses granted to or by NeighborhoodFind with respect to the foregoing. Except as disclosed in Annex 2.13(5), all patents, patent applications, trade names, trademarks, trademark registrations and applications, copyrights, copyright registrations and applications and grants of licenses set forth in Annex 2.13(5) (i) are subject to no pending or threatened challenge, and (ii) can and will be transferred by NeighborhoodFind to MonsterDaata as a result of the Merger and without the consent of any Person other than NeighborhoodFind. Neither the execution nor delivery of the Merger Documentation, nor the consummation of the transactions contemplated thereby will give any licensor or licensee of NeighborhoodFind any right to change the terms or provisions of, terminate or cancel, any license to which NeighborhoodFind is a party. (f) NeighborhoodFind has furnished to MonsterDaata true and complete copies of all agreements and other documents disclosed or referred to in Annexes 2.13(1) through 2.13(5), as well as any additional agreements or documents, requested by MonsterDaata. NeighborhoodFind has in all material respects performed all obligations required to be performed by it to date and is not in default in any respect under any of the contracts, agreements, leases, documents, commitments or other arrangements to which it is a party or by which it or any of its property is otherwise bound or affected. All parties having material contractual arrangements with NeighborhoodFind are in substantial compliance therewith to the best of NeighborhoodFind's knowledge, and none are in material default thereunder. NeighborhoodFind does not have outstanding any power of attorney. 2.14 Employees. NeighborhoodFind has complied in all material respects with all laws relating to the employment of labor, and NeighborhoodFind has encountered no material labor difficulties. Except as disclosed in Annex 2.14 or pursuant to ordinary arrangements of employment compensation, NeighborhoodFind is not under any obligation or liability to any officer, manager, employee or Affiliate of NeighborhoodFind. Annex 2.14 contains a true and complete list of all employees of NeighborhoodFind as of the date hereof and the current salaries earned by each of them. 2.15 Tax Returns and Audits. All required federal, state and local tax returns of NeighborhoodFind have been accurately prepared and duly and timely filed, and all federal, state and local taxes required to be paid with respect to the periods covered by such returns have been paid. NeighborhoodFind is not and has not been delinquent in the payment of any tax, assessment or governmental charge. NeighborhoodFind has not had a tax deficiency proposed or assessed against it and has not executed a waiver of any statute of limitations on the 11 assessment or collection of any tax or governmental charge. None of NeighborhoodFind's federal income tax returns nor any state or local income or franchise tax returns has been audited by governmental authorities. The reserves for taxes, assessments and governmental charges reflected on the Balance Sheet are and will be sufficient for the payment of all unpaid taxes and governmental charges payable by NeighborhoodFind with respect to the period ended on the Balance Sheet Date. Since the Balance Sheet Date, NeighborhoodFind has made adequate provisions on its books of account for all taxes, assessments and governmental charges with respect to its business, properties and operations for such period. NeighborhoodFind has withheld or collected from each payment made to each of its employees the amount of all taxes (including, but not limited to, federal, state and local income taxes, Federal Insurance Contribution Act taxes and Federal Unemployment Tax Act taxes) required to be withheld or collected therefrom, and has paid the same to the proper tax receiving officers or authorized depositaries. 2.16 Patents and Other Intangible Assets. (a) NeighborhoodFind (i) owns or has the right to use, free and clear of all Liens, claims and restrictions, all patents, trademarks, service marks, trade names, copyrights and licenses set forth in Annex 2.13(4) or otherwise, and rights with respect to the foregoing, used in or necessary for the conduct of its business as now conducted or proposed to be conducted without infringing upon or otherwise acting adversely to the right or claimed right of any Person under or with respect to any of the foregoing and (ii) is not obligated or under any liability to make any payments by way of royalties, fees or otherwise to any owner or licensor of, or other claimant to, any patent, trademark, service mark, trade name, copyright or other intangible asset, with respect to the use thereof or in connection with the conduct of its business or otherwise. (b) To the best knowledge of NeighborhoodFind, NeighborhoodFind owns and has the unrestricted right to use all trade secrets, if any, including know-how, negative know-how, formulas, patterns, programs, devices, methods, techniques, inventions, designs, processes, computer programs and technical data and all information that derives independent economic value, actual or potential, from not being generally known or known by competitors (collectively, "intellectual property") required for or incident to the development, operation and sale of all products and services sold by NeighborhoodFind, free and clear of any right, Lien, or claim or others; provided, however, the possibility exists that other Persons, completely independently of the NeighborhoodFind or its employees or agents could have developed intellectual property similar or identical trade secrets or technical information by others. All intellectual property can and will be transferred by NeighborhoodFind to MonsterDaata as a result of the Merger and without the consent of any Person other than NeighborhoodFind. 2.17 Employee Benefit Plans; ERISA. (a) Except as disclosed in Annex 2.17 hereto, there are no "employee benefit plans" (within the meaning of Section 3(3) of the ERISA) nor any other employee benefit or fringe benefit arrangements, practices, contracts, policies or programs of every type other than programs merely involving the regular payment of wages, commissions, or bonuses established, maintained or contributed to by NeighborhoodFind, 12 whether written or unwritten and whether or not funded. The plans listed in Annex 2.17 hereto are hereinafter referred to as the "Employee Benefit Plans." (b) All current and prior material documents, including all amendments thereto, with respect to each Employee Benefit Plan have been given to MonsterDaata or its advisors. (c) All Employee Benefit Plans are in material compliance with the applicable requirements of ERISA, the Internal Revenue Code of 1986, as amended (the "Code") and any other applicable state, federal or foreign law. (d) There are no pending claims or lawsuits which have been asserted or instituted against any Employee Benefit Plan, the assets of any of the trusts or funds under the Employee Benefit Plans, the plan sponsor or the plan administrator of any of the Employee Benefit Plans or against any fiduciary of an Employee Benefit Plan with respect to the operation of such plan, nor does NeighborhoodFind have any knowledge of any incident, transaction, occurrence or circumstance which might reasonably be expected to form the basis of any such claim or lawsuit. (e) There is no pending or contemplated investigation or pending or possible enforcement action by the Pension Benefit Guaranty Corporation, the Department of Labor, the Internal Revenue Service or any other government agency with respect to any Employee Benefit Plan and NeighborhoodFind has no knowledge of any incident, transaction, occurrence or circumstance which might reasonably be expected to trigger such an investigation or enforcement action. (f) No actual or contingent liability exists with respect to the funding of any Employee Benefit Plan or for any other expense or obligation of any Employee Benefit Plan, except as disclosed on the financial statements of NeighborhoodFind or the Annexes to this Agreement, and no contingent liability exists under ERISA with respect to any "multi-employer plan," as defined in Section 3(37) or Section 4001(a)(3) of ERISA. (g) No events have occurred or are expected to occur with respect to any Employee Benefit Plan that would cause a material change in the costs of providing benefits under such Employee Benefit Plan or would cause a material change in the cost of providing for other liabilities of such Employee Benefit Plan. 2.18 Title to Property and Encumbrances. NeighborhoodFind has good, valid and marketable title to all properties and assets used in the conduct of its business free of all Liens and other encumbrances, except liens associated with the Commerce Capital Notes, Permitted Liens and such ordinary and customary imperfections of title, restrictions and encumbrances as do not, individually or in the aggregate, materially detract from the value of the property or assets or materially impair the use made thereof by NeighborhoodFind in its business. Without limiting the generality of the foregoing, NeighborhoodFind has good and marketable title to all of its properties and assets reflected in the Balance Sheet, except for property disposed of in the usual and ordinary course of business since the Balance Sheet Date 13 and for property held under valid and subsisting leases which are in full force and effect and which are not in default. 2.19 Condition of Properties. All facilities, equipment, fixtures, vehicles and other properties owned, leased or used by NeighborhoodFind are in good operating condition and repair, subject to ordinary wear and tear, and are adequate and sufficient for NeighborhoodFind's business. 2.20 Insurance Coverage. There is in full force and effect one or more of the policies of insurance set forth in Annex 2.13(3) issued by insurers of recognized responsibility, insuring NeighborhoodFind and its properties and business against such losses and risks, and in such amounts, as are customary for corporations of established reputation engaged in the same or similar business and similarly situated, and adequate for the purposes thereof. NeighborhoodFind has not been refused any insurance coverage sought or applied for, and NeighborhoodFind has no reason to believe that it will be unable to renew its existing insurance coverage as and when the same shall expire upon terms at least as favorable to those currently in effect, other than possible increases in premiums that do not result from any act or omission of NeighborhoodFind. No suit, proceeding or action or threat of suit, proceeding or action has been asserted or made against NeighborhoodFind since its formation due to bodily injury or alleged bodily injury arising out of the function or malfunction of a product or service designed, manufactured, sold or distributed by NeighborhoodFind. 2.21 Litigation. Except as disclosed in Annex 2.21 hereto, there is no legal action, suit, arbitration or other legal, administrative or other governmental proceeding pending or, to the best knowledge of NeighborhoodFind, threatened against or affecting NeighborhoodFind or its properties, assets or business, and after due investigation, NeighborhoodFind is not aware of any incident, transaction, occurrence or circumstance that might be expected to result in or form the basis for any such action, suit, arbitration or other proceeding. NeighborhoodFind is not in default with respect to any order, writ, judgment, injunction, decree, determination or award of any court or any governmental agency or instrumentality or arbitration authority. 2.22 Licenses. NeighborhoodFind possesses from the appropriate governmental authority all licenses, permits, authorizations, approvals, franchises and rights necessary for NeighborhoodFind to engage in the business currently conducted by it, all of which are in full force and effect, a true and current list of which is set forth in Annex 2.22 hereto. 2.23. Internal Software Applications. The current software applications used by NeighborhoodFind in the operation of its business are set forth and described in Annex 2.23 hereto (the "Software"). (a) To the extent that any of the Software has been designed or developed by NeighborhoodFind's management information or development staff or by consultants on NeighborhoodFind's behalf, such Software is original and capable of copyright protection in the United States, and NeighborhoodFind has complete rights to and ownership of such Software, including possession of, or ready access to, the source code for such Software in its most recent version. No part of any such Software is an imitation or copy of, or infringes 14 upon, the software of any other person or entity, or violates or infringes upon any common law or statutory rights of any other person or entity, including, without limitation, rights relating to defamation, contractual rights, copyrights, patents, trade secrets and rights of privacy or publicity. NeighborhoodFind has not sold, assigned, licensed, distributed or in any other way disposed of or encumbered any of the Software. (b) The Software, to the extent it is licensed from any third party licensor or constitutes "off-the-shelf" software, is held by NeighborhoodFind legitimately and is fully transferable hereunder to MonsterDaata without any third party consent. All of NeighborhoodFind's computer hardware has legitimately licensed software installed therein. (c) The Software is free from any significant defect or programming or documentation error, operates and runs in a reasonable and efficient business manner, conforms to the stated specifications thereof and, with respect to owned Software, the applications can be recreated from their associated source codes. (d) NeighborhoodFind has not knowingly altered its data (except in the ordinary and customary course of NeighborhoodFind's business) or any Software or supporting software which may, in turn, damage the integrity of the data, stored in electronic, optical, or magnetic or other form. Except as disclosed in Annex 2.23 hereto, NeighborhoodFind has no knowledge of the existence of any bugs or viruses with respect to the Software. (e) NeighborhoodFind shall, to the maximum possible extent, pass through to MonsterDaata all manufacturer's and supplier's warranties and support contracts for the Software that are not owned by NeighborhoodFind, and NeighborhoodFind shall, upon MonsterDaata's reasonable request, execute each and every document that is necessary or appropriate to effectuate MonsterDaata's obtaining and enjoying the benefits of any such pass-through warranty. (f) NeighborhoodFind has furnished MonsterDaata with true and accurate copies of all documentation (end user or otherwise) relating to the use, maintenance and operation of the Software. (g) Annex 2.23 hereto sets forth the physical location of the computer server which is currently hosting NeighborhoodFind's Internet Websites. Such server is validly owned or a portion thereof is validly leased by NeighborhoodFind. The applicable Internet hosting contract, which describes NeighborhoodFind's contractual obligations, term of the contract, associated costs, corporate information of the host and amount of bandwidth to which the server is connected to the Internet has been previously provided to MonsterDaata. Annex 2.23 hereto additionally sets forth (1) the name and IP address of the Internet Web homepage, when the homepage was granted and the date of the next annual payment, (2) a list of any and all software which can be downloaded from the Website, and (3) a list of any license agreements displayed on the Website prior to downloading any particular software. NeighborhoodFind's Websites contain all legal disclaimers believed to be required. 2.24 Interested Party Transactions. Except as disclosed in Annex 2.24 hereto, no officer, manager or member of NeighborhoodFind or any Affiliate or "associate" (as 15 such term is defined in Rule 405 under the Securities Act) of any such Person or NeighborhoodFind has or has had, either directly or indirectly, (a) an interest in any Person that (i) furnishes or sells services or products that are furnished or sold or are proposed to be furnished or sold by NeighborhoodFind or (ii) purchases from or sells or furnishes to NeighborhoodFind any goods or services, or (b) a beneficial interest in any contract or agreement to which NeighborhoodFind is a party or by which it may be bound or affected. 2.25 Receivables. The accounts and notes receivable shown on the Balance Sheet (net of the allowance for doubtful accounts in the amount appearing thereon) have been collected or are collectible in the usual and ordinary course of NeighborhoodFind's business in the amounts thereof shown on the Balance Sheet. The accounts and notes receivable of NeighborhoodFind acquired after the Balance Sheet Date and prior to the Closing Date will be reflected on the books of account of NeighborhoodFind at 100% of the amount thereof and have been collected, or are or will be collectible in the usual and ordinary course of NeighborhoodFind's business, in the full amounts thereof (less normal allowances for doubtful accounts), assuming performance by MonsterDaata of the obligations relating thereto with respect to periods from and after the Effective Time. Attached hereto as Annex 2.25 is a true and complete listing of the accounts receivable of NeighborhoodFind at May 31, 2001 which contains the name of each customer, the amount owing by that customer on such date and the aging of that amount showing the proportion thereof 30, 60, 90 and over 90 days old. All of the accounts receivable reflected on the Balance Sheet and in Annex 2.25 and all accounts receivable which have arisen since the Balance Sheet Date are valid and enforceable claims, and the goods and services sold and delivered which gave rise to such accounts receivable were sold and delivered in conformity with all applicable express and implied warranties, purchase orders, agreements and specifications, and are not subject to any valid defense or offset. 2.26 Customers, Suppliers and Independent Contractors. Since the Balance Sheet Date, NeighborhoodFind has not been advised that any customer, supplier or independent contractor of NeighborhoodFind intends to terminate or materially curtail its business relationship (other than as a result of nonrenewal) with NeighborhoodFind. Annex 2.26 contains a true and complete list of customers of NeighborhoodFind as of a reasonably recent date from the date hereof showing, among other things, the total number of customers of NeighborhoodFind, the respective commencement dates of their subscriptions and the total amount of their subscription payments during the past 12 months. 2.27 Obligations to or by Members. Except as disclosed in Annex 2.27, NeighborhoodFind has no liability or obligation or commitment to any Member or any Affiliate or "associate" (as such term is defined in Rule 405 under the Securities Act) of any Member, nor does any Member or any such Affiliate or associate have any liability, obligation or commitment to NeighborhoodFind. 2.28 Disclosure. There is no fact relating to NeighborhoodFind that NeighborhoodFind has not disclosed to MonsterDaata in writing which materially and adversely affects nor, insofar as NeighborhoodFind can now foresee, will materially and adversely affect, the Condition of NeighborhoodFind. No representation or warranty by NeighborhoodFind herein and no information disclosed in the schedules, annexes or exhibits hereto by 16 NeighborhoodFind contains any untrue statement of a material fact or omits to state a material fact necessary to make the statements contained herein or therein not misleading. 3. Representations and Warranties of MonsterDaata. MonsterDaata represents and warrants to NeighborhoodFind and the Members as follows: 3.1 Organization and Standing. MonsterDaata is a corporation duly organized and existing in good standing under the laws of the State of Delaware. MonsterDaata has heretofore delivered to NeighborhoodFind complete and correct copies of its Certificate of Incorporation and By-laws as now in effect. MonsterDaata has full corporate power and authority to carry on its business as it is now being conducted and as now proposed to be conducted and to own or lease its properties and assets. 3.2 Corporate Authority. MonsterDaata has full corporate power and authority to enter into the Merger Documentation and the other agreements to be made pursuant to the Merger Documentation, and to carry out the transactions contemplated hereby and thereby. All corporate acts and proceedings required for the authorization, execution, delivery and performance of the Merger Documentation and such other agreements and documents by MonsterDaata have been fully and validly taken or will have been so taken prior to the Closing. Each of the Merger Documents constitutes a valid and binding obligation of MonsterDaata, each enforceable against it in accordance with their respective terms, except as such enforcement may be limited by bankruptcy, insolvency, reorganization or other similar laws affecting creditors' rights generally and by general principles of equity. 3.3 Broker's Fees. No person, firm, corporation or other entity is entitled by reason of any act or omission of MonsterDaata to any broker's or finder's fees, commission or other similar compensation with respect to the execution and delivery of this Agreement or the Certificate of Merger, or with respect to the consummation of the transactions contemplated hereby or thereby. 3.4 Capitalization of MonsterDaata. The authorized capital stock of MonsterDaata consists of (a) 100,000,000 shares of common stock, par value $.01 per share, of which 3,270,778 shares are issued and outstanding on the date hereof, and (b) 10,000,000 shares of preferred stock, par value $.01 per share, of which (i) 2,000 shares have been designated Series A Cumulative Convertible Preferred Stock and 418.05 are issued and outstanding on the date hereof, (ii) 2,000 shares have been designated Series B Cumulative Convertible Preferred Stock and 25 shares are issued and outstanding on the date hereof, (iii) 1,500,000 shares have been designated 7% Series C Convertible Preferred Stock and 1,072,800 are issued and outstanding on the date hereof, and (iv) 360,000 shares will be designated Series D Convertible Preferred Stock on or prior to the Effective Date and none are issued and outstanding on the date hereof. All outstanding shares of the capital stock of MonsterDaata are validly issued and outstanding, fully paid and nonassessable. Annex 3.4 hereto lists all outstanding stock options, warrants, rights, commitments and convertible securities to acquire securities of MonsterDaata. 3.5 Validity of Shares. The MonsterDaata Securities to be issued at the Closing pursuant to Section 1.5(a)(ii) hereof and, if applicable, Section 1.6, when issued and 17 delivered in accordance with the terms hereof and of the Certificate of Merger, shall be duly and validly issued, fully paid and nonassessable and free and clear of all liens, claims and encumbrances (other than pursuant to Section 8 hereof). 3.6 Information. (a) MonsterDaata has delivered to the Members true and complete copies of MonsterDaata Annual Report on Form 10-KSB for the fiscal year ended December 31, 2000, MonsterDaata Registration Statement on Form SB-2 filed on June 8, 2001, and MonsterDaata Quarterly Report on Form 10-QSB for the quarter ended March 31, 2001 (the "MonsterDaata SEC Documents"). None of the MonsterDaata SEC Documents, as of their respective dates, contained any untrue statement of a material fact or omitted to state a material fact necessary in order to make the statements contained therein not misleading. (b) MonsterDaata has not filed, and nothing has occurred with respect to which MonsterDaata would be required to file, any report on Form 8-K since March 31, 2001. Prior to and until the Closing, MonsterDaata will provide to the Members copies of any and all reports filed by MonsterDaata after March 31, 2001 with the Commission and any and all reports or notices delivered to the stockholders of MonsterDaata concurrently with the filing or delivery thereof. (c) The shares of Common Stock are quoted on the Over-the-Counter (OTC) Bulletin Board under the symbol "MSRD," and MonsterDaata is in compliance in all material respects with all rules and regulations of the OTC Bulletin Board applicable to it and its shares of Common Stock. 3.7 Financial Statements. The balance sheets, and statements of income, changes in financial position and stockholders' equity contained in the MonsterDaata SEC Documents have been prepared in accordance with generally accepted accounting principals applied on a basis consistent with prior periods (and, in the case of unaudited financial information, on a basis consistent with year-end audits). The financial statements included in the Annual Report on Form 10-KSB are as audited by, and include the related opinions of, Marcum & Kliegman LLP, MonsterDaata's independent certified public accountants. The financial information included in the Quarterly Report on Form 10-QSB for the quarter ended March 31, 2001 is unaudited, but reflects all adjustments (including normally recurring accounts) which MonsterDaata considers necessary for a fair presentation of such information. 3.8 Governmental Consents. All material consents, approvals, orders, or authorizations of, or registrations, qualifications, designations, declarations, or filings with any federal or state governmental authority on the part of MonsterDaata required in connection with the consummation of the Merger shall have been obtained prior to, and be effective as of, the Closing. 3.9 Compliance with Laws and Instruments. The business and operations of MonsterDaata have been and are being conducted in accordance with all applicable laws, rules and regulations, except for such violations thereof for which the penalties, in the aggregate, would not have a material adverse effect on the condition of MonsterDaata. The execution, delivery and performance by MonsterDaata of the Merger Documentation and the consummation by MonsterDaata of the transactions contemplated by this Agreement; (a) will not 18 require from its stockholders any consent or approval that has not already been obtained, (b) will not require any authorization, consent or approval of, or filing or registration with, any court or governmental agency or instrumentality, except such as shall have been obtained prior to the Closing, (c) will not cause MonsterDaata to violate or contravene (i) any provision of law, (ii) any rule or regulation of any agency or government, (iii) any order, judgment or decree of any court or (iv) any provision of the Certificate of Incorporation or By-laws of MonsterDaata, (d) will not violate or be in conflict with, result in a breach of or constitute (with or without notice or lapse of time, or both) a default under, any indenture, loan or credit agreement, deed of trust, mortgage, security agreement or other contract, agreement or instrument to which MonsterDaata is a party or by which MonsterDaata or any of its properties is bound or affected and (e) will not result in the creation or imposition of any Lien upon any property or asset of MonsterDaata. MonsterDaata is not in violation of, or (with or without notice or lapse of time, or both) in default under, any term or provision of its Certificate of Incorporation or By-laws or of any indenture, loan or credit agreement, deed of trust, mortgage, security agreement or other contract, agreement or instrument to which MonsterDaata is a party or by which MonsterDaata or any of its properties is bound or affected. 3.10 Indebtedness. MonsterDaata has no Indebtedness for Borrowed Money except as disclosed on its balance sheet as at March 31, 2001. 3.11 MonsterDaata Stockholders. Annex 3.11 hereto contains a true and complete list of the names and/or general categories of the record and beneficial holders of all of the outstanding capital stock of MonsterDaata. There is no voting trust, agreement or arrangement among any of the beneficial holders of MonsterDaata capital stock affecting the exercise of the voting rights of such stock. 3.12 Absence of Undisclosed Liabilities. MonsterDaata has no material obligation or liability (whether accrued, absolute, contingent, liquidated or otherwise, whether due or to become due), arising out of any transaction entered into at or prior to the Closing, except (a) to the extent set forth on or reserved against in MonsterDaata's March 31, 2001 balance sheet, (b) current liabilities incurred and obligations under agreements entered into in the usual and ordinary course of business since March 31, 2001, none of which (individually or in the aggregate) materially and adversely affects the condition of MonsterDaata, and (c) by the specific terms of any written agreement, document or arrangement identified in the Annexes. 3.13 Employees. MonsterDaata has complied in all material respects with all laws relating to the employment of labor, and MonsterDaata has encountered no material labor difficulties. Except pursuant to ordinary arrangements of employment or consulting compensation, MonsterDaata is not under any obligation or liability to any officer, director, employee or Affiliate of MonsterDaata. 3.14 Tax Returns and Audits. All required federal, state and local tax returns of MonsterDaata have been accurately prepared and duly and timely filed, and all federal, state and local taxes required to be paid with respect to the periods covered by such returns have been paid. MonsterDaata is not and has not been delinquent in the payment of any tax, assessment or governmental charge. MonsterDaata has not had a tax deficiency proposed or 19 assessed against it which has not been paid in full and has not executed a waiver of any statute of limitations on the assessment or collection of any tax or governmental charge. Except as stated in Annex 3.14, none of MonsterDaata's federal income tax returns nor any state or local income or franchise tax returns has been audited by governmental authorities. The reserved for taxes, assessments and governmental charges (including interest and penalties) reflected on MonsterDaata's March 31, 2001 balance sheet are and will be sufficient for the payment of all unpaid taxes (whether or not shown due on a tax return, and whether or not the corresponding return or returns were accurately prepared) and governmental charges (including interest and penalties) payable by MonsterDaata with respect to any periods ending on or before March 31, 2001. Since March 31, 2001, MonsterDaata has made adequate provisions on its books of account for all taxes, assessments and governmental charges with respect to its business, properties and operations for such period. MonsterDaata has withheld or collected from each payment made to each of its employees the amount of all taxes (including, but not limited to, federal, state and local income taxes) required to be withheld or collected therefrom, and has paid the same to the proper tax receiving officers or authorized depositaries. 3.15 Title to Property and Encumbrances. MonsterDaata has good and valid title to all properties and assets (other than real property) used in the conduct of its business free of all Liens and other encumbrances, except Permitted Liens and such ordinary and customary imperfections of title, restrictions and encumbrances as do not, individually or in the aggregate, materially detract from the value of the property or assets or materially impair the use made thereof by MonsterDaata in its business. Without limiting the generality of the foregoing, MonsterDaata has good and valid title to all of its properties and assets (other than real property) reflected in its March 31, 2001 balance sheet, except for property disposed of in the usual and ordinary course of business since March 31, 2001 and for property held under valid and subsisting leases which are in full force and effect and which are not in default. 3.16 Litigation. Except as disclosed in the MonsterDaata SEC Documents, there is no legal action, suit, arbitration or other legal, administrative or other governmental proceeding pending or, to the best knowledge of MonsterDaata, threatened against or affecting MonsterDaata or its properties, assets or business, and after investigation with key employees of MonsterDaata, MonsterDaata is not aware of any incident, transaction, occurrence or circumstance that might be expected to result in any order, writ, judgment, injunction, decree, determination or award of any court or any governmental agency or instrumentality or arbitration authority. 3.17 Licenses. MonsterDaata possesses from the appropriate governmental authority all licenses, permits, authorizations, approvals, franchises and rights necessary for MonsterDaata to engage in the business currently conducted by it, all of which are in full force and effect. 3.18 No General Solicitation. In issuing MonsterDaata Securities in the Merger hereunder, neither MonsterDaata nor anyone acting on its behalf has offered to sell the MonsterDaata Securities by any form of general solicitation or advertising. 3.19 Disclosure. There is no fact relating to MonsterDaata that MonsterDaata has not disclosed to NeighborhoodFind in writing which materially and adversely 20 affects nor, insofar as MonsterDaata can now foresee, will materially and adversely affect, the condition of MonsterDaata. No representation or warranty by MonsterDaata herein and no information disclosed in the schedules, annexes or exhibits hereto by MonsterDaata contains any untrue statement of a material fact or omits to state a material fact necessary to make the statements contained herein or therein not misleading. 4. Representations, Warranties and Covenants of the Members. Each of the Members severally represents and warrants to, and covenants with, MonsterDaata with respect to such Member, as follows: 4.1 Acts and Proceedings. Each Member has full right, power and authority to enter into, deliver and perform the Agreement and all acts and proceedings required for the authorization, execution and delivery of this Agreement and the performance of this Agreement by such Member have been lawfully and validly taken. 4.2 Compliance with Laws and Instruments. The execution, delivery and performance by each Member of the Merger Documentation and each of the other documents contemplated hereby and the consummation by such Member of the transactions contemplated hereby and thereby (a) will not cause such Member to violate or contravene (i) any provision of law, (ii) any rule or regulation of any agency or government or (iii) any order, judgment or decree of any court and (b) will not violate or be in conflict with, result in a breach of or constitute (with or without notice or lapse of time, or both) a default under, any indenture, loan or credit agreement, deed of trust, mortgage, security agreement or other agreement or instrument to which such Member is bound or affected. 4.3 Binding Obligations. This Agreement and each of the other agreements and documents being entered into by each Member in connection herewith constitutes the legal, valid and binding obligation of such Member and is enforceable against such Member in accordance with its terms, except as such enforcement is limited by bankruptcy, insolvency and other similar laws affecting the enforcement of creditors' rights generally and by general principles of equity. 4.4 Title to Interests. Each Member has good, valid and marketable title to all NeighborhoodFind Interests indicated in Annex 2.5 hereto as being owned by such Member, free and clear of all Liens. To the knowledge of such Member, other than the LLC Agreement, there is no voting trust, agreement or arrangement among any of the beneficial holders of NeighborhoodFind Interests affecting the exercise of the voting rights of such membership interests, and such Member is not a party to or bound or affected by any such voting trust, agreement or arrangement. 4.5 Information. Each Member has had an opportunity to ask and receive answers to any questions he or it may have had concerning the terms and conditions of the Merger and the MonsterDaata Securities to be issued therein and has obtained any additional information that he or it has requested. 4.6 Resale of Stock. Each Member is acquiring MonsterDaata Securities to be purchased for himself or for itself from MonsterDaata for investment and not 21 with a current view to selling or otherwise distributing any of said MonsterDaata Securities in violation of the Securities Act or the securities laws of any state; provided, however, that the provisions of this paragraph shall not prejudice such Member's right at all times to sell or otherwise dispose of all or any of the MonsterDaata Securities so acquired by such Member pursuant to an effective registration statement under the Securities Act or under an exemption from such registration available under the Securities Act, subject to the terms of the lock-up letters referred to in Section 6.8 hereof, to the extent applicable. Each Member is an "accredited investor," as such term is defined in Regulation D under the Securities Act. 4.7 Members' Knowledge of NeighborhoodFind. Each Member represents and warrants that, to the best of its knowledge, (a) there is no fact relating to NeighborhoodFind that NeighborhoodFind has not disclosed to MonsterDaata in writing which materially and adversely affects nor, insofar as such Member can now foresee, will materially and adversely affect, the Condition of NeighborhoodFind; and (b) no representations or warranties by NeighborhoodFind herein and no information disclosed in the schedules, annexes or exhibits hereto by NeighborhoodFind contains any untrue, incorrect or inaccurate statement of a material fact or omits or fails to state a material fact necessary to make the statements contained herein or therein not misleading. 5. Conduct of Businesses Pending the Merger. 5.1 Conduct of Business by NeighborhoodFind Pending the Merger. Prior to the Effective Time, unless MonsterDaata shall otherwise agree in writing or as otherwise contemplated by this Agreement: (i) the business of NeighborhoodFind shall be conducted only in the ordinary course; (ii) NeighborhoodFind shall not (A) directly or indirectly redeem, purchase or otherwise acquire or agree to redeem, purchase or otherwise acquire any NeighborhoodFind Interests; (B) amend its LLC Agreement; or (C) split, combine or reclassify the outstanding NeighborhoodFind Interests or declare, set aside or pay any dividend payable in cash, stock or property or make any distribution with respect to any such NeighborhoodFind Interests; (iii) NeighborhoodFind shall not (A) issue or agree to issue any additional membership interests of, or options, warrants or rights of any kind to acquire any membership interests of, NeighborhoodFind (other than issuances of interests to Avalon Equity Fund L.P. or reallocations of interests between NeighborhoodFind's members in consideration for additional working capital); (B) acquire or dispose of any fixed assets or acquire or dispose of any other substantial assets other than in the ordinary course of business; (C) incur additional Indebtedness or any other liabilities or enter into any other transaction; (D) enter into any contract, agreement, commitment or arrangement with respect to any of the foregoing; or (E) except as contemplated by this Agreement, enter into any contract, agreement, commitment or arrangement to dissolve, merge, consolidate or enter into any other material business combination; 22 (iv) NeighborhoodFind and the Member Representative shall use all of their best efforts to preserve intact the business organization of NeighborhoodFind, to keep available the service of its present officers and key employees, and to preserve the good will of those having business relationships with it; (v) NeighborhoodFind will not, nor will it authorize any manager or Member or authorize or permit any officer or employee or any attorney, accountant or other representative retained by it to, make, solicit, encourage any inquiries with respect to, or engage in any negotiations concerning, any Acquisition Proposal (as defined below). NeighborhoodFind will promptly advise MonsterDaata orally and in writing of any such inquiries or proposals (or requests for information) and the substance thereof. As used in this paragraph, "Acquisition Proposal" shall mean any proposal for a merger or other business combination involving NeighborhoodFind or for the acquisition of a substantial equity interest in it or any material assets of it other than as contemplated by this Agreement. NeighborhoodFind will immediately cease and cause to be terminated any existing activities, discussions or negotiations with any person conducted heretofore with respect to any of the foregoing; and (vi) NeighborhoodFind will not enter into any new employment agreements with any of its officers or employees or grant any increases in the compensation or benefits of its officers and employees other than increases in the ordinary course of business and consistent with past practice or amend any employee benefit plan or arrangement. 5.2 Conduct of Business by MonsterDaata Pending the Merger. Prior to the Effective Time, unless NeighborhoodFind shall otherwise agree in writing or as otherwise contemplated by this Agreement: (i) the business of MonsterDaata shall be conducted only in the ordinary course (it being understood that MonsterDaata is pursuing other acquisition transactions); (ii) MonsterDaata shall not (A) directly or indirectly redeem, purchase or otherwise acquire or agree to redeem, purchase or otherwise acquire any shares of Common Stock; (B) amend its Certificate of Incorporation or By-laws; or (C) split, combine or reclassify the Common Stock or declare, set aside or pay any dividend payable in cash, stock or property or make any distribution with respect to such Common Stock; (iii) MonsterDaata shall not issue or agree to issue any additional shares of, or options, warrants or rights of any kind to acquire shares of, Common Stock except to issue shares of Common Stock upon the exercise or conversion of stock options, warrants or convertible securities outstanding on the date hereof; and (iv) MonsterDaata shall use all of its best efforts to preserve intact the business organization of MonsterDaata, to keep available the service of its present officers and key employees, and to preserve the good will of those having business relationships with it. 23 6. Additional Agreements. 6.1 Access and Information. NeighborhoodFind and MonsterDaata shall each afford to the other and to the other's accountants, counsel and other representatives full access during normal business hours throughout the period prior to the Effective Time of all of its properties, books, contracts, commitments and records (including but not limited to tax returns) and during such period, each shall furnish promptly to the other all information concerning its business, properties and personnel as such other party may reasonably request, provided that no investigation pursuant to this Section 6.1 shall affect any representations or warranties made herein. Each party shall hold, and shall cause its employees and agents to hold, in confidence all such information (other than such information which (i) is already in such party's possession or (ii) becomes generally available to the public other than as a result of a disclosure by such party or its directors, officers, managers, employees, agents or advisors, or (iii) becomes available to such party on a non-confidential basis from a source other than a party hereto or its advisors, provided that such source is not known by such party to be bound by a confidentiality agreement with or other obligation of secrecy to a party hereto or another party until such time as such information is otherwise publicly available; provided, however, that (A) any such information may be disclosed to such party's directors, officers, managers, members and employees and representatives of such party's advisors who need to know such information for the purpose of evaluating the transactions contemplated hereby (it being understood that such directors, officers, managers, members, employees and representatives shall be informed by such party of the confidential nature of such information), (B) any disclosure of such information may be made as to which the party hereto furnishing such information has consented in writing, and (C) any such information may be disclosed pursuant to a judicial, administrative or governmental order or request; provided, however, that the requested party will promptly so notify the other party so that the other party may seek a protective order or appropriate remedy and/or waive compliance with this Agreement and if such protective order or other remedy is not obtained or the other party waives compliance with this provision, the requested party will furnish only that portion of such information which is legally required and will exercise its best efforts to obtain a protective order or other reliable assurance that confidential treatment will be accorded the information furnished). If this Agreement is terminated, each party will deliver to the other all documents and other materials (including copies) obtained by such party or on its behalf from the other party as a result of this Agreement or in connection herewith, whether so obtained before or after the execution hereof. 6.2 Additional Agreements. Subject to the terms and conditions herein provided, each of the parties hereto agrees to use its commercially reasonable efforts to take, or cause to be taken, all action and to do, or cause to be done, all things necessary, proper or advisable under applicable laws and regulations to consummate and make effective the transactions contemplated by this Agreement, including using its commercially reasonable efforts to satisfy the conditions precedent to the obligations of any of the parties hereto (including, in the case of MonsterDaata with respect to the condition provided in Section 7.1(n), executing new UCC financing statements to perfect the security interests of Commerce Capital and taking such other related actions reasonably requested by Commerce Capital) to obtain all necessary waivers, and to lift any injunction or other legal bar to the Merger (and, in such case, to proceed with the Merger as expeditiously as possible), subject, however, to the appropriate vote of the Members of NeighborhoodFind and the stockholders of MonsterDaata, as required by 24 law. In order to obtain any necessary governmental or regulatory action or non-action, waiver, consent, extension or approval, MonsterDaata agrees to take all reasonable actions and to enter into all reasonable agreements as may be necessary to obtain timely governmental or regulatory approvals and to take such further action in connection therewith as may be necessary. In case at any time after the Effective Time any further action is necessary or desirable to carry out the purposes of this Agreement, the proper officers, directors, members and/or managers of MonsterDaata and NeighborhoodFind shall take all such necessary action. 6.3 Publicity. No party shall issue any press release or public announcement pertaining to the Merger that has not been agreed upon in advance by MonsterDaata and NeighborhoodFind, except as MonsterDaata reasonably determines to be necessary in order to comply with the rules of the Securities and Exchange Commission. 6.4 MonsterDaata Director and Observer Designee. MonsterDaata agrees to cause a designee of the holders of a majority of the Series D Preferred Stock to be issued to the Members hereunder to be elected a member of the MonsterDaata Board of Directors at the Effective Time. In addition, such holders shall be entitled to designate an observer to the MonsterDaata Board of Directors, but such designee shall not be entitled to any fees or expense reimbursements as may be paid from time to time to members of the MonsterDaata Board of Directors. 6.5 Series D Preferred Stock. At or before the Effective Time, (a) the Board of Directors of MonsterDaata shall have authorized the filing with the Secretary of State of the State of Delaware of a Certificate of Designations, Rights and Preferences with respect to the Series D Preferred Stock in the form attached as Annex D (the "Certificate of Designations") and the issuance of MonsterDaata Securities as provided in Section 1.5(a)(ii), (b) the filing of the Certificate of Designations shall have been authorized by all the holders of all classes of MonsterDaata Securities having the right of approval with respect thereto, (c) the stockholders of MonsterDaata shall have authorized the issuance of additional MonsterDaata Securities in the amounts set forth in Section 1.5(a)(ii), to the extent required, and (d) MonsterDaata shall cause the Certificate of Designations to be filed with the Secretary of State of the State of Delaware. 6.6 Gayhart Agreement. MonsterDaata shall enter into an employment or consulting agreement, effective no later than the Effective Time, with James Gayhart, on terms and conditions satisfactory to MonsterDaata. 6.7 Registration Rights Agreement. As of the Effective Time, the Members of NeighborhoodFind (whose names appear on the signature page hereof) shall enter into a Registration Rights Agreement, on substantially the terms and conditions set forth in the form of agreement attached as Annex F. 6.8 Lock-Up Letters. As of the Effective Time, the executive officers and Members of NeighborhoodFind shall execute lock-up letters, on substantially the terms and conditions set forth in the form of letter attached as Annex G. 25 6.9 Cancellation of NeighborhoodFind Equity Rights. At or before the Effective Time, NeighborhoodFind shall have obtained the consent of all holders of all NeighborhoodFind Equity Rights for the termination or exchange thereof. 6.10 Auditor's Cooperation and Consent. Each of the Members shall use its commercially reasonable efforts to cause the accounting firm of Hantzmon, Wiebel & Company to (a) cooperate with MonsterDaata in connection with the completion of such firm's audit work and (b) deliver to MonsterDaata its written consent for the use by MonsterDaata of any financial statements of NeighborhoodFind audited by such firm in any filings that MonsterDaata may be required to make with the Commission following the Closing Date. 7. Conditions of Parties' Obligations. 7.1 Conditions of MonsterDaata Obligations. The obligations of MonsterDaata under this Agreement and the Certificate of Merger are subject to the fulfillment at or prior to the Closing of the following conditions, any of which may be waived in whole or in part by MonsterDaata. (a) No Errors, etc. The representations and warranties of NeighborhoodFind and the Members under this Agreement shall be deemed to have been made again on the Closing Date and shall then be true and correct. (b) Compliance with Agreement. NeighborhoodFind and the Members shall have performed and complied with all agreements and conditions required by this Agreement to be performed or complied with by them on or before the Closing Date. (c) No Default or Adverse Change. There shall not exist on the Closing Date any Default or Event of Default or any event or condition that, with the giving of notice or lapse of time, or both, would constitute a Default or Event of Default, and since the Balance Sheet Date there shall have been no material adverse change in the Condition of NeighborhoodFind. (d) Certificate of Officers. NeighborhoodFind shall have delivered to MonsterDaata a certificate dated the Closing Date, executed on its behalf by the President and Treasurer of NeighborhoodFind, certifying the satisfaction of the conditions specified in paragraphs (a), (b) and (c) of this Section 7.1. (e) Certificates of the Members. A manager of NeighborhoodFind shall have delivered to MonsterDaata a certificate dated the Closing Date, executed by such manager, certifying the satisfaction of the conditions specified in paragraphs (a), (b) and (c) of this Section 7.1, and the Members shall have delivered to MonsterDaata a certificate dated the Closing Date, executed by each of the Members, certifying that the representations and warranties of each of them in Section 4 of this Agreement are true and correct as of the Closing Date and that such Members have complied with all agreements and conditions required by this Agreement to be performed or complied with by them on or before the Closing Date. 26 (f) Opinion of NeighborhoodFind's Counsel. MonsterDaata shall have received from each of Baer, Marks & Upham, LLP, counsel for NeighborhoodFind and the Member Representative, and from counsel for Commerce Capital, a favorable opinion dated the Closing Date to the effect set forth in Annex 7.1(f) hereto. (g) Stockholder Approval. The stockholders of MonsterDaata shall have approved all actions required to be approved by them pursuant to Section 6.5 hereof. (h) Authorizations; Consents. Except for the filings of the Certificate of Merger, all consents, authorizations, orders and approvals of, and filings and registrations with, any court, governmental body or instrumentality that are required for the execution and delivery of this Agreement and of the Certificate of Merger and the consummation of the Merger shall have been duly made or obtained, and all consents by third parties that are required for the Merger shall have been obtained. (i) Supporting Documents. MonsterDaata shall have received the following: (i) Copies of resolutions of the managers and the Members of NeighborhoodFind, certified by the Secretary of NeighborhoodFind, authorizing and approving the execution, delivery and performance of the Merger Documentation and all other documents and instruments to be delivered pursuant hereto and thereto; (ii) Copies of the agreements evidencing the consent of the holders of all outstanding NeighborhoodFind Equity Rights to the cancellation in full of the same; (iii) A certificate of incumbency executed by the Secretary of NeighborhoodFind certifying the names, titles and signatures of the officers authorized to execute any documents referred to in this Agreement; and (iv) Such additional supporting documentation and other information with respect to the transactions contemplated hereby as MonsterDaata may reasonably request, including domain name assignment forms. (j) No Restraining Action. No action or proceeding before any court, governmental body or agency shall have been threatened, asserted or instituted to restrain or prohibit, or to obtain substantial damages in respect of, this Agreement or the Certificate of Merger or the carrying out of the transactions contemplated by the Merger Documentation. (k) Consents. NeighborhoodFind shall have obtained and delivered to MonsterDaata written consents, satisfactory in form and substance to MonsterDaata, from each party to the leases, contracts, instruments and other documents listed in Annexes 2.13(1) through 2.13(5) consenting to the assignment to MonsterDaata upon the effectiveness of the Merger, of all of the rights and interests of NeighborhoodFind in and to such leases, contracts, instruments and documents, except to the extent (i) waived by MonsterDaata in its sole discretion, or (ii) such lease, contract, instrument or other document does not require the consent of such party to such assignment. 27 (l) Financial Statements. MonsterDaata's independent auditors shall have determined to their reasonable satisfaction that the financial statements annexed hereto as Schedule 2.10 are substantially complete and contain sufficient information in accordance with the applicable requirements of Regulation S-X adopted by the Commission to form the basis for an audited balance sheet as at December 31, 2000, and audited statements of income and retained earnings and changes in financial position for the year then ended. (m) Escrow Agreement. MonsterDaata, the Escrow Agent, NeighborhoodFind and the Member Representative shall have entered into an Escrow Agreement substantially in the form of Annex H hereto. (n) Commerce Capital Notes. Commerce Capital shall have consented to the amendment of the Commerce Capital Notes to, among other things, (i) substitute MonsterDaata as obligor thereunder and (ii) reduce the interest rate thereunder from 13% per annum to 8% per annum. (o) Operating Plan. The parties shall have agreed upon a reasonably acceptable operating plan. (p) Appraisal Shares. No Member shall have requested appraisal of its membership interests pursuant to any applicable appraisal or dissenters' rights or statutes. (q) Confidentiality Agreements. All executive officers and key employees of NeighborhoodFind shall have entered into MonsterDaata's standard invention assignment, non-disclosure, non-competition and non-solicitation agreement or, to the extent an executive officer or key employee has not entered into such an agreement, MonsterDaata shall have concluded that such executive officer or key employee is already a party to an invention assignment, non-disclosure, non-competition and non-solicitation agreement running in favor of NeighborhoodFind and its successors that it is acceptable to MonsterDaata. (r) Proceedings and Documents. All corporate and other proceedings and actions taken in connection with the transactions contemplated hereby and all certificates, opinions, agreements, instruments and documents mentioned herein or incident to any such transactions shall be satisfactory in form and substance to MonsterDaata. NeighborhoodFind and the Members shall furnish to MonsterDaata such supporting documentation and evidence of the satisfaction of any or all of the conditions preceding specified in this Section 7.1 as MonsterDaata or its counsel may reasonably request. 7.2 Conditions of NeighborhoodFind's Obligations. The obligations of NeighborhoodFind and the Members under this Agreement and the Certificate of Merger are subject to the fulfillment at or prior to the Closing of the following conditions: (a) No Errors, etc. The representations and warranties of MonsterDaata under this Agreement shall be deemed to have been made again on the Closing Date and shall then be true and correct. 28 (b) Compliance with Agreement. MonsterDaata shall have performed and complied with all agreements and conditions required by this Agreement and the Certificate of Merger to be performed or complied with by it on or before the Closing Date. (c) Adverse Change. Since April 1, 2001, there shall have been no material adverse change in the condition of MonsterDaata. (d) Certificate of Officers. MonsterDaata shall have delivered to NeighborhoodFind a certificate, dated the Closing Date, executed on its behalf by the President and Treasurer of MonsterDaata, certifying the satisfaction of the conditions specified in paragraphs (a), (b) and (c) of this Section 7.2. (e) Opinion of MonsterDaata Counsel. NeighborhoodFind shall have received from Greenberg Traurig, LLP, counsel for MonsterDaata, a favorable opinion dated the Closing Date to the effect set forth in Annex 7.2(e). (f) Supporting Documents. NeighborhoodFind shall have received the following: (i) Copies of resolutions, certified by the Secretary of MonsterDaata, of (A) the Board of Directors of MonsterDaata, authorizing the filing with the Secretary of State of the State of Delaware of the Certificate of Designations and the issuance of MonsterDaata Securities as provided in Section 1.5(a)(ii) and authorizing and approving, to the extent applicable, the execution, delivery and performance of this Agreement, the Certificate of Merger and all other documents and instruments to be delivered by them pursuant hereto and thereto (B) the stockholders of all classes of MonsterDaata Securities having the right of approval with respect the filing of the Certificate of Designations, authorizing the same and (C) the stockholders of MonsterDaata, authorizing the issuance of additional MonsterDaata Securities in the amounts set forth in Section 1.5(a)(ii); (ii) A certificate of incumbency executed by the Secretary of MonsterDaata certifying the names, titles and signatures of the officers authorized to execute the documents referred to in paragraph (i) above; and (iii) Such additional supporting documentation and other information with respect to the transactions contemplated hereby as NeighborhoodFind or its counsel may reasonably request. (g) Operating Plan. Each of MonsterDaata and NeighborhoodFind shall have approved an operating plan for MonsterDaata which shall include a plan for the acquisition and integration of NeighborhoodFind into MonsterDaata, such approval not to be unreasonably withheld. (h) Proceedings and Documents. All corporate and other proceedings and actions taken in connection with the transactions contemplated hereby and all certificates, opinions, agreements, instruments and documents mentioned herein or incident to any such transactions shall be satisfactory in form and substance to NeighborhoodFind. MonsterDaata shall furnish to the Members such supporting documentation and evidence of 29 satisfaction of any or all of the conditions specified in this Section 7.2 as the Member Representative or counsel to the Members and NeighborhoodFind may reasonably request. NeighborhoodFind and the Member Representative may waive compliance with any of the conditions precedent specified in this Section 7.2. 8. Nature and Survival of Representations and Warranties; Indemnification. 8.1 Nature and Survival. (a) The covenants, representations and warranties of the parties hereunder and all documents delivered pursuant hereto shall survive the effectiveness of the Merger and all inspections, examinations or audits on behalf of the parties whether conducted before or after the effectiveness of the Merger; provided, however, that the representations and warranties of MonsterDaata and the Members contained in this Agreement or in any certificate delivered pursuant to Section 7.1(d) or 7.2(c) hereof shall survive the effectiveness of the Merger and shall continue in full force and effect for a period ending on the first anniversary of the Effective Time (the "Survival Period") and shall terminate at 6:00 p.m., eastern standard time, on the last day of the Survival Period (the "Expiration Date"); provided, further, however, if any party shall have notified another party (a notice to the Member Representative to be considered as notice to all Members) on or before the expiration of such Survival Period with a general description of an asserted inaccuracy in any representation or breach or default of any warranty or covenant in this Agreement or such certificate (which notice shall include a non-binding estimate, made in good faith, of the amount being claimed), the right of the party giving notice to recover Damages in the case of MonsterDaata or Member Damages in the case of the Members from the party to whom notice is given in respect of such asserted inaccuracy, breach or default, shall survive until the final determination by a court of competent jurisdiction (and any appeals therefrom) of the claim by the party giving notice against the party to whom such notice is given. (b) Upon the effectiveness of the Merger, the covenants, representations and warranties of NeighborhoodFind given herein shall terminate without diminution or effect upon the covenants, warranties and representations of the Members hereunder, and no Member shall have any right of contribution from NeighborhoodFind or MonsterDaata. 8.2 Member Indemnification. (a) Each Member agrees to indemnify and hold harmless MonsterDaata against and in respect of its pro rata share (determined on the basis of the percentage of the total number of MonsterDaata Securities issued pursuant to Sections 1.5(a)(ii) and 1.6 that were issued to such Member or to the Escrow Agent in respect of such Member) of any and all Damages, subject to the limitations appearing in subsection (b) of this Section 8.2. "Damages," as used herein, shall include any claim, action, demand, loss, cost, expense, liability (joint or several), penalty and other damage, including, without limitation, reasonable counsel fees and other costs and expenses reasonably incurred in investigation or in attempting to avoid the same or oppose the imposition thereof or in enforcing this indemnity, resulting to MonsterDaata from (i) any inaccurate representation made by or on behalf of NeighborhoodFind 30 or a Member in this Agreement or any certificate or other document referenced in, this Agreement and delivered pursuant hereto, (ii) the breach of any of the warranties or agreements made by or on behalf of NeighborhoodFind or a Member in this Agreement or any certificate or other document referenced in this Agreement and delivered pursuant hereto, (iii) the breach or default in the performance by NeighborhoodFind or a Member of any of the obligations to be performed by any of them hereunder or under the Certificate of Merger, or (iv) the matter disclosed in Annex 2.21 hereto. (b) Each Member agrees to pay or reimburse MonsterDaata for any payment made or amount payable or loss suffered or incurred by MonsterDaata at any time from and after the Effective Time, in respect of its allocated portion (as determined pursuant to Section 8.2(a) hereof) of any Damages to which the foregoing indemnity relates; provided, however, that no payment or reimbursement shall be made until the aggregate Damages exceed $30,000, after which each Member shall pay or reimburse MonsterDaata for its allocated portion (as determined pursuant to Section 8.2(a) hereof) of all Damages. Notwithstanding the foregoing, each Member's liability to MonsterDaata for Damages shall be limited to the Current Market Value, as of the Closing Date, of the MonsterDaata Securities which such Member has received or will have the right to receive under the terms of Sections 1.5(a)(ii) and 1.6 hereof. (c) If any claim shall be asserted against MonsterDaata by a third party for which MonsterDaata intends to seek indemnification from the Members under this Section 8.2, MonsterDaata shall given written notice to the Member Representative of the nature of the claim asserted within forty-five (45) days after any executive officer of MonsterDaata learns of the assertion thereof and determines that MonsterDaata may have a right of indemnification with respect thereto, but the failure to give this notice will not relieve the Members of any liability hereunder in respect of this claim. MonsterDaata shall have the exclusive right to conduct, through counsel of its own choosing, which counsel is approved by the Member Representative (which approval may not be unreasonably withheld), the defense of any such claim or action, and may compromise or settle such claims or actions with the prior consent of the Member Representative (which shall not be unreasonably withheld). 8.3 Escrow Fund. In order to provide a fund for the partial satisfaction of any claim or claims against the Members ("Claims") by MonsterDaata which may arise under Section 8.2 above, and for other legitimate business purposes, on the Closing Date MonsterDaata shall deliver to Corporate Stock Transfer, Inc. (the "Escrow Agent") under the terms of an Escrow Agreement among MonsterDaata, the Escrow Agent, NeighborhoodFind and the Members (the "Escrow Agreement"), substantially in the form of Annex H hereto, certificates representing the MonsterDaata Securities required to be deposited therein pursuant to Section 1.7(a)(i) hereof, registered in the name of the Escrow Agent or its nominee. The MonsterDaata Securities so deposited and all other moneys, property and assets deposited with the Escrow Agent pursuant to the Escrow Agreement (such shares, money, property and assets being collectively referred to herein as the "Escrow Fund") shall be held and dealt with in accordance with the Escrow Agreement. As more fully provided in the Escrow Agreement, all shares, money, property and assets remaining in the Escrow Fund on the Expiration Date shall be released to the Members on such date. 31 8.4 Satisfaction of Indemnity. (a) Subject to Sections 8.4(b) and (c) hereof, any Damages incurred, paid or borne by MonsterDaata for which it is entitled to indemnification from any Member (with respect to such Member, its "Indemnifiable Damages") under this Section 8 shall be initially satisfied by the delivery to MonsterDaata for cancellation of the MonsterDaata Securities held by the Escrow Agent in respect of such Member. Any such Indemnifiable Damages in excess of the value of such MonsterDaata Securities held by the Escrow Agent, may, at the election of such Member, be satisfied, in whole or in part, by such Member either (i) making a cash payment to MonsterDaata by wire transfer of immediately available funds or (ii) delivering to MonsterDaata for cancellation the number of MonsterDaata Securities issued to such Member pursuant to Sections 1.5(a)(ii) or 1.6 which has a value equal to the Indemnified Damages as determined pursuant to Section 8.4(b) and (c) below; provided, however, that such Member shall also pay or reimburse MonsterDaata for the out-of-pocket expenses (including, without limitation, any fees payable to the transfer agent of the MonsterDaata Securities) of canceling such returned MonsterDaata Securities. (b) Any indemnification obligation of a Member to be satisfied by the delivery to MonsterDaata for cancellation of MonsterDaata Securities by the Escrow Agent or such Member, as applicable, shall be satisfied by the delivery of shares of Series D Preferred Stock and Common Stock in proportion to the number of such shares received by the Members with the ratio of shares of Series D Preferred Stock and Common Stock so delivered being proportional to the respective number of such shares received by the Members (e.g., one share of Common Stock for every 4.03 shares of Series D Preferred Stock, on an as-converted basis). (c) For purposes of this Section 8.4, all MonsterDaata Securities shall be valued at their Current Market Value as of the Closing Date (assuming, for purposes of determining the Current Market Value of the shares of Series D Preferred Stock, that such shares are converted and the underlying shares of Common Stock are outstanding). 8.5 MonsterDaata Indemnification. MonsterDaata shall indemnify and hold the Members harmless against and in respect of all Member Damages; provided that no payment or reimbursement shall be made until the aggregate Member Damages exceed $30,000, after which MonsterDaata shall pay or reimburse the Members for all Member Damages. "Member Damages" shall mean any claim, action, demand, loss, cost, expense, liability (joint or several), penalty and other damage, including, without limitation, reasonable counsel fees, and other costs and expenses reasonably incurred in investigating or in attempting to avoid the same or oppose the imposition thereof or in enforcing this indemnity, resulting to a Member from (A) any inaccurate representation made by MonsterDaata in this Agreement or any certificate or other document referenced in this Agreement and delivered by it pursuant hereto, (B) breach of any of the warranties or agreements made by MonsterDaata in this Agreement or any certificate or other document referenced in this Agreement and delivered by it pursuant hereto, or (C) breach or default in the performance by MonsterDaata of any of the obligations to be performed by MonsterDaata hereunder and under the Certificate of Merger. Subject to the limitations set forth in the first sentence of this Section 8.5, MonsterDaata agrees to pay or reimburse the Members for any payment made or amount payable or loss suffered or incurred by the Members 32 at any time from and after the Effective Time in respect of any Member Damages to which the foregoing indemnity relates. 9. Amendment of Agreement. This Agreement and the Certificate of Merger may be amended or modified at any time in all respects by an instrument in writing executed (i) in the case of this Agreement by the parties hereto (with the Member Representative having the full power and authority subject to the provisions of Section 1.12 to act on behalf of all Members) and (ii) in the case of the Certificate of Merger by the parties thereto. Either MonsterDaata, on the one hand, or the Members, on the other hand (with the Member Representative having the full power and authority subject to the provisions of Section 1.12 to act on behalf of all Members), may, in writing: (a) extended the time for performance of any of the obligations of the other; (b) waive any inaccuracies in the representations or breaches in the warranties or covenants by the other contained in this Agreement or any exhibits hereto or in any documents delivered pursuant hereto; (c) waive compliance by the other with any of the covenants contained in this Agreement and performance of any obligations by the other; and (d) waive the satisfaction of any condition that is precedent to the performance by the party so waiving of its obligations under this Agreement. 10. Definitions. Unless the context otherwise requires, the terms defined in this Section 10 shall have the meanings herein specified for all purposes of this Agreement, applicable to both the singular and plural forms of any of the terms herein defined. "Acquisition Proposal" shall have the meaning assigned to it in Section 5.1(v). "Affiliate" shall mean any Person that directly or indirectly controls, is controlled by, or is under common control with, the indicated Person. "Agreement" shall mean this Agreement and Plan of Merger. "Balance Sheet" and "Balance Sheet Date" shall have the meanings assigned to such terms in Section 2.10 hereof. "Certificate of Designations" shall have the meaning assigned to such term in Section 6.5. "Certificate of Merger" shall have the meaning assigned to it in the second recital of this Agreement. "Claims" shall have the meaning assigned to it in Section 8.3 hereof. 33 "Closing" and "Closing Date" shall have the meanings assigned to such terms in Section 11 hereof. "Code" shall mean the Internal Revenue Code of 1986, as amended. "Commerce Capital" shall mean Commerce Capital, L.P., a Tennessee limited partnership. "Commerce Capital Notes" shall have the meaning assigned to it in Section 1.9 hereof. "Commission" shall mean the U.S. Securities and Exchange Commission. "Common Stock" shall mean the Common Stock, par value $0.01 per share, of MonsterDaata. "Condition of NeighborhoodFind" shall have the meaning assigned to it in Section 2.2 hereof. "Current Market Value" of the Common Stock as of a particular date shall mean the average of the price of a share of Common Stock, determined on the basis of the last reported sales price regular way of Common Stock reported on the composite tape, or similar reporting system for issues listed on the New York Stock Exchange or the American Stock Exchange, or if Common Stock is not traded on either such exchanges, the Nasdaq National Market, for the ten (10) consecutive trading days (the "Measurement Days"); or if Common Stock is not traded on either such exchanges or the Nasdaq National Market, the average during the Measurement Days of averages of the high bid and low asked prices as of the close of business on such dates as reported by the Over-the-Counter Bulletin Board, National Quotation Bureau, Inc. or any similar successor organizations or, if none of the above applies, the Current Market Value will be determined by an independent reputable valuation and appraisal company mutually agreed upon by MonsterDaata and the Member Representative (which appraiser shall be instructed to disregard any minority interest discount), and if no agreement can be reached within a 30-day period, by the average of the two Current Market Values as determined by independent reputable valuation and appraisal companies retained by each of MonsterDaata and the Member Representative; provided, however, that the aggregate fees and expenses of any such independent valuation and appraisal company or companies shall be shared evenly between MonsterDaata, on the one hand, and the Member exercising rights under Section 8.4 or to be compensated pursuant to Section 1.6, on the other hand. "Damages" shall have the meaning assigned to it in Section 8.2 hereof. "Default" shall mean a default or failure in the due observance or performance of any covenant, condition or agreement on the part of NeighborhoodFind to be observed or performed under the terms of this Agreement or the Certificate of Merger, if such default or failure in performance shall remain unremedied for five (5) days. "Corporation Law" shall mean the General Corporation Law of the State of Delaware. 34 "Effective Time" shall have the meaning assigned to it in Section 1.2 hereof. "Employee Benefit Plans" shall have the meaning assigned to it in Section 2.17(a) hereof. "Equity Securities" shall mean all equity interests of NeighborhoodFind, all securities (whether equity or Indebtedness for Borrowed Money) convertible, with or without consideration, into any such equity interests and all securities (whether equity or Indebtedness for Borrowed Money) carrying any warrant or right to subscribe to or purchase any equity interests or any such warrants or rights. "ERISA" shall mean the Employee Retirement Income Securities Act of 1974, as amended. "Escrow Agent" shall have the meaning assigned to it in Section 8.3 hereof. "Escrow Agreement" shall have the meaning assigned to it in Section 7.1(m) hereof. "Escrow Fund" shall have the meaning assigned to it in Section 8.3 hereof. "Event of Default" shall mean (a) the failure of NeighborhoodFind to pay any Indebtedness for Borrowed Money, or any interest or premium thereon, within five (5) days after the same shall become due, whether such Indebtedness shall become due by scheduled maturity, by required prepayment, by acceleration, by demand or otherwise, (b) an event of default under any agreement or instrument evidencing or securing or relating to any such Indebtedness, or (c) the failure of NeighborhoodFind to perform or observe any material term, covenant, agreement or condition on its part to be performed or observed under any agreement or instrument evidencing or securing or relating to any such Indebtedness when such term, covenant or agreement is required to be performed or observed. "Expiration Date" shall have the meaning assigned to it in Section 8.1(a) hereof. "Fee Event" shall have the meaning assigned to it in Section 12.3 hereof. "GAAP" shall mean generally accepted accounting principles in the United States, as in effect from time to time. "Indebtedness" shall mean any obligation of NeighborhoodFind which under generally accepted accounting principles is required to be shown on the balance sheet of NeighborhoodFind as a liability. Any obligation secured by a Lien on, or payable out of the proceeds of production from, property of NeighborhoodFind shall be deemed to be Indebtedness even though such obligation is not assumed by NeighborhoodFind. 35 "Indebtedness for Borrowed Money" shall mean (a) all Indebtedness in respect of money borrowed including, without limitation, Indebtedness which represents the unpaid amount of the purchase price of any property and is incurred in lieu of borrowing money or using available funds to pay such amounts and not constituting an account payable or expense accrual incurred or assumed in the ordinary course of business of NeighborhoodFind, (b) all Indebtedness evidenced by a promissory note, bond or similar written obligation to pay money, or (c) all such Indebtedness guaranteed by NeighborhoodFind or for which NeighborhoodFind is otherwise contingently liable. "Indemnifiable Damages" shall have the meaning assigned to it in Section 8.4(a). "Lien" shall mean any mortgage, pledge, security interest, encumbrance, lien or charge of any kind, including, without limitation, any conditional sale or other title retention agreement, any lease in the nature thereof and the filing of or agreement to give any financing statement under the Uniform Commercial Code of any jurisdiction and including any lien or charge arising by statute or other law. "LLC Agreement" shall have the meaning assigned to it in Section 2.1 hereof. "Member Damages" shall have the meaning assigned to it in Section 8.5 hereof. "Member Representative" shall mean Avalon Equity Fund L.P., ---------------------- a Delaware limited partnership. "Members" shall mean all of the Members of NeighborhoodFind, including the Member Representative. "Merger" shall have the meaning assigned to it in Section 1.1 hereof. "Merger Documentation" shall have the meaning assigned to it in Section 2.6 hereof. "MonsterDaata" shall mean MonsterDaata, Inc., a Delaware corporation. "MonsterDaata SEC Documents" shall have the meaning assigned to it in Section 3.6 hereof. "MonsterDaata Securities" shall mean the Common Stock, the Series D Preferred Stock and the Warrants. "NeighborhoodFind" shall mean NeighborhoodFind.com LLC, a Delaware limited liability company. "NeighborhoodFind Equity Rights" shall have the meaning assigned to it in Section 1.8 hereof 36 "NeighborhoodFind Interests" shall mean the membership interests of NeighborhoodFind, taken together. "Permitted Liens" shall mean (a) Liens for taxes and assessments or governmental charges or levies not at the time due or in respect of which the validity thereof shall currently be contested in good faith by appropriate proceedings; (b) Liens in respect of pledges or deposits under workmen's compensation laws or similar legislation, carriers', warehousemen's, mechanics', laborers' and materialmens' and similar Liens, if the obligations secured by such Liens are not then delinquent or are being contested in good faith by appropriate proceedings; and (c) Liens incidental to the conduct of the business of NeighborhoodFind that were not incurred in connection with the borrowing of money or the obtaining of advances or credits and which do not in the aggregate materially detract from the value of its property or materially impair the use made thereof by NeighborhoodFind in its business. "Person" shall include all natural persons, corporations, business trusts, associations, limited liability companies, partnerships, joint ventures and other entities and governments and agencies and political subdivisions. "Securities Act" shall mean the Securities Act of 1933, as amended. "Series D Preferred Stock" shall mean the Series D Convertible Preferred Stock, par value $.01 per share, of MonsterDaata. "Survival Period" shall have the meaning assigned to it in Section 8.1 hereof. "Surviving Corporation" shall have the meaning assigned to it in Section 1.1 hereof. "Target Date" shall have the meaning assigned to it in Section 1.6 hereof. "Target Price" shall have the meaning assigned to it in Section 1.6 hereof. "Warrants" shall mean warrants to purchase Common Stock. 11. Closing. The closing of the Merger (the "Closing") shall occur concurrently with the Effective Time (the "Closing Date"). The Closing shall occur at the law offices of Greenberg Traurig, LLP referred to in Section 13.1 hereof. At the Closing, MonsterDaata shall (i) deliver to the Escrow Agent certificates representing the MonsterDaata Securities to be held pursuant to the Escrow Agreement pursuant to Section 1.7(b), and (ii) deliver to each Member certificates representing the balance of the MonsterDaata Securities to be issued pursuant to Section 1.5(a)(ii) hereof directly to them pursuant to Section 1.7(b) hereof. Such delivery shall be against delivery to MonsterDaata of the certificates, opinions, agreements and other instruments referred to in Section 7.1 hereof, and the certificates representing all of the NeighborhoodFind Interests issued and outstanding immediately prior to the Effective Time. MonsterDaata will deliver at such Closing to NeighborhoodFind the officers' certificate and opinion referred to in Section 7.2 hereof. All of the other documents and certificates and agreements referenced in Section 7 will also be executed as described therein. Neither the 37 signing of this Agreement nor any of the actions to be taken at the Closing shall be deemed to have taken place until the Effective Time, and at the Effective Time, all such actions will be deemed to be taken simultaneously. 12. Termination Prior to Closing 12.1 Termination of Agreement. This Agreement may be terminated at any time prior to the Closing: (a) By the mutual written consent of NeighborhoodFind and MonsterDaata; (b) By NeighborhoodFind, if MonsterDaata (i) fails to perform in any material respect any of its agreements contained herein required to be performed by it on or prior to the Closing Date, (ii) materially breaches any of its representations, warranties or covenants contained herein, which failure or breach is not cured within ten (10) days after NeighborhoodFind has notified MonsterDaata of its intent to terminate this Agreement pursuant to this paragraph (b); (c) By MonsterDaata, if NeighborhoodFind or any of the Members (i) fail to perform in any material respect any of their respective agreements contained herein required to be performed by them on or prior to the Closing Date, (ii) materially breach any of their representations, warranties or covenants contained herein, which failure or breach is not cured within ten (10) days after MonsterDaata has notified NeighborhoodFind of its intent to terminate this Agreement pursuant to this paragraph (c); (d) By either NeighborhoodFind or MonsterDaata, if there shall be any order, writ, injunction or decree of any court or governmental or regulatory agency binding on MonsterDaata or NeighborhoodFind, which prohibits or restrains either of them from consummating the transactions contemplated hereby, provided that the parties hereto shall have used their commercially reasonable efforts to have any such order, writ, injunction or decree lifted and the same shall not have been lifted within 90 days after entry, by any such court or governmental or regulatory agency; or (e) By either NeighborhoodFind or MonsterDaata, if the Closing has not occurred on or prior to August 31, 2001, for any reason other than delay or nonperformance of the party seeking such termination. 12.2 Termination of Obligations. Termination of this Agreement pursuant to this Section 12 shall terminate all obligations of the parties hereunder, except for the obligations under Sections 6.1, 13.3 and 13.11; provided, however, that termination pursuant to paragraphs (b) or (c) of Section 12.1 shall not relieve the defaulting or breaching party or parties from any liability to the other parties hereto. 12.3 Topping Fee. Without affecting any rights or remedies as may be available to a party in such event, if at any time after the execution of this Agreement and prior to August 31, 2001, (a) any Person or Person(s) other than MonsterDaata or its Affiliates acquires (i) more than 50% of the outstanding membership interests (on a fully-diluted basis) of 38 NeighborhoodFind, (ii) any of NeighborhoodFind's Intellectual Property, other than in the usual and ordinary course of business or (iii) any Person or Persons other than MonsterDaata or its Affiliates acquires the power to elect a majority of the managers of NeighborhoodFind; or (b) NeighborhoodFind consummates or agrees to consummate a merger, amalgamation, consolidation, business combination or similar transaction with any Person or Persons other than MonsterDaata or its Affiliates (any of the foregoing events being a "Fee Event"), then NeighborhoodFind and the Member Representative shall be jointly and severally obligated to pay MonsterDaata a cash fee in the amount of $500,000 within ten (10) days after such event; provided, however, that if MonsterDaata withdraws from this Agreement absent a breach (reasonably deemed to be material by MonsterDaata) by, or failure of, NeighborhoodFind or any Member to satisfy a condition of closing, then no such fee shall be payable. 13. Miscellaneous. 13.1 Notices. Any notice, request or other communication hereunder shall be given in writing and shall be served either personally by overnight delivery or delivered by mail, certified return receipt and addressed to the following addresses: If to MonsterDaata: MonsterDaata, Inc. 32 East 31st Street, 9th Floor New York, New York 10016 Attention: Mr. Samuel B. Petteway, Jr., President and Chief Executive Officer With a copy to: Greenberg Traurig, LLP 200 Park Avenue, 14th Floor New York, New York 10166 Attention: Spencer G. Feldman, Esq. If to NeighborhoodFind or any Member: c/o Avalon Equity Fund L.P. 800 Third Avenue, Suite 3100 New York, NY 10022 Attention: Mr. David Unger With a copy to: Baer Marks & Upham, LLP 805 Third Avenue New York, New York 10022 Attention: Anne E. Pitter, Esq. Notices shall be effective upon receipt or refusal. Counsel for a party (or any authorized representative) shall have authority to accept delivery of any notice on behalf of such party. 13.2 Entire Agreement. This Agreement, including the annexes, schedules and exhibits attached hereto and other documents referred to herein, contains the entire understanding of the parties hereto with respect to the subject matter hereof. This Agreement 339 supersedes all prior agreements and undertakings between the parties with respect to such subject matter. 13.3 Expenses. Each party shall bear and pay all of the legal, accounting and other expenses incurred by it in connection with the transactions contemplated by this Agreement; provided that the Members jointly and severally shall assume and pay (i) any accounting costs, fees and expenses of NeighborhoodFind for auditing matters pursuant to Section 7.1(l) or otherwise, and (ii) the costs, fees and expenses of counsel for NeighborhoodFind and the Members. 13.4 Time. Time is of the essence in the performance of the parties' respective obligations herein contained. 13.5 Severability. Any provision of this Agreement that is prohibited or unenforceable in any jurisdiction shall, as to such jurisdiction, be ineffective to the extent of such prohibition or unenforceability without invalidating the remaining provisions hereof, and any such prohibition or unenforceability in any jurisdiction shall not invalidate or render unenforceable such provision in any other jurisdiction. 13.6 Successors and Assigns. This Agreement shall be binding upon and inure to the benefit of the parties hereto and their respective successors, assigns and heirs; provided, however, that none of NeighborhoodFind, any Member or MonsterDaata shall directly or indirectly transfer or assign any of its or his rights hereunder in whole or in part without the written consent of the other parties hereto, which shall not be unreasonably withheld, and any such transfer or assignment without said consent shall be void. 13.7 No Third Parties Benefited. This Agreement is made and entered into for the sole protection and benefit of the parties hereto, their successors, assigns and heirs, and no other Person shall have any right or action under this Agreement. 13.8 Counterparts. This Agreement may be executed in one or more counterparts, with the same effect as if all parties had signed the same document. Each such counterpart shall be an original, but all such counterparts together shall constitute a single agreement. 13.9 Recitals, Schedules and Exhibits. The Recitals, Schedules, Exhibits and Annexes to this Agreement are incorporated herein and, by this reference, made a part hereof as if fully set forth herein. 13.10 Section Headings and Gender. The Section headings used herein are inserted for reference purposes only and shall not in any way affect the meaning or interpretation of this Agreement. All personal pronouns used in this Agreement shall include the other genders, whether used in the masculine, feminine or neuter gender, and the singular shall include the plural, and vice versa, whenever and as often as may be appropriate. 13.11 Governing Law. This Agreement shall be governed by and construed in accordance with the laws of the State of New York, except to the extent that the laws of the State of Delaware govern the requirements for the adoption, approval and execution of this Agreement and the Certificate of Merger and the legal effect of the Merger. 40 IN WITNESS WHEREOF, the parties hereto have executed this Agreement to be binding and effective as of the day and year first above written. MONSTERDAATA, INC. By: /s/ Samuel B. Petteway, Jr. ------------------------------------------- Title: President and CEO ------------------------------------------- NEIGHBORHOODFIND.COM LLC By: /s/ James E. Gayhart, Jr. ------------------------------------------- Title: Interim President and CEO ------------------------------------------- MEMBERS: AVALON EQUITY FUND L.P. By: Avalon Equity Partners LLC, its sole general partner By: /s/ David W. Unger ------------------------------------------- Title: Partner ------------------------------------------- COMMERCE CAPITAL L.P. By: Commerce Equity Capital Corporation, its sole general partner By: /s/ Rudy E. Ruark ------------------------------------------- Title: Vice President ------------------------------------------- The undersigned hereby agree with the Members of NeighborhoodFind to be bound by Section 6.8 of this Agreement effective upon the Closing. /s/ James Gayhart ------------------------------------------- James Gayhart /s/ Peter Polimino ------------------------------------------- Peter Polimino 41 EX-2 5 e763071.txt EXHIBIT 2.2 Exhibit 2.2 AMENDMENT NO. 1 TO AGREEMENT AND PLAN OF MERGER The undersigned, being all of the parties (the "Parties") to the Agreement and Plan of Merger, dated July 20, 2001 (the "Merger Agreement"), by and among MonsterDaata, Inc. , a Delaware corporation ("MonsterDaata"), NeighborhoodFind.com, LLC, a Delaware limited liability company ("NeighborhoodFind") and the members of NeighborhoodFind, desire to amend the Merger Agreement, effective July 31, 2001, as provided herein. Capitalized terms used herein without definition shall have the respective meanings set forth in the Merger Agreement. WHEREAS, the Parties desire to reduce and reallocate the distribution of MonsterDaata Securities between the Members pursuant to Section 1.5(a) of the Merger Agreement, and to provide for the distribution of MonsterDaata Securities on behalf of the Members to certain Persons who are not Members; and WHEREAS, the Parties desire to reallocate between the Members the obligation to have certain of the MonsterDaata Securities otherwise issuable to the Members deposited into an Escrow Fund pursuant to Section 1.7(a) of the Merger Agreement. NOW THEREFORE, in consideration of the premises and of the agreements contained herein, it is hereby agreed as follows. 1. Amendments. (a) Section 1.5(a)(ii) of the Merger Agreement is hereby amended and restated in its entirety to read as follows: (ii) the membership interests of NeighborhoodFind (the "NeighborhoodFind Interests") beneficially owned by the Members listed below, which membership interests constitute all of the issued and outstanding membership interests of NeighborhoodFind, shall, by virtue of the Merger and without any action on the part of the holders thereof, be converted into the right to receive the MonsterDaata Securities specified below (which, in the aggregate, constitutes 25% of the shares of Common Stock outstanding following the Merger on a fully-diluted basis, less 500,000 shares of each of the Common Stock and Series D Preferred Stock, on an as-converted basis): MonsterDaata Securities (on an as-converted basis into Common Stock -------------------------------------------------- Membership Shares of Warrants to Interest Series D Purchase in Preferred Shares of Common Name NeighborhoodFind Stock Common Stock Stock ---- ---------------- ----- ----------- ------------ Avalon Equity Fund L.P. 93.09% 2,378,095 184,967 2,059,136 Commerce 6.91% - 405,292 88,804 Capital, L.P. Total 100.00% 2,378,095 590,259 2,147,940 ======= ========= ======= ========= ------------- (b) The following new section, to be designated subsection 1.5A, is hereby inserted into the Merger Agreement immediately following Section 1.5: 1.5A Certain Additional Consideration. Immediately after the Effective Time and upon cancellation of all NeighborhoodFind Interests that were outstanding immediately prior to the Effective Time, MonsterDaata shall issue (a) 192,318 Warrants to the Alpha Group Retirement Plan, (b) 14, 129 Warrants to Matthew T. Green and (c) 70,647 Warrants to Peter C. Marcum. (c) The first sentence of Section 1.7(a) is hereby amended and restated in its entirety to read as follows: (a) Immediately after the Effective Time and upon cancellation of all NeighborhoodFind Interests that were outstanding immediately prior to the Effective Time, MonsterDaata shall issue (i) a certificate registered in the name of Avalon Equity Fund L.P. representing 356,714 shares of Series D Preferred Stock (on an as-converted basis into Common Stock) that it shall be entitled to receive as set forth in Section 1.5(a)(ii) hereof, which shall be deposited with the Escrow Agent or its nominee, accompanied by a stock power duly executed in blank, pursuant to the terms of the Escrow Agreement, (ii) a certificate registered in the name of Avalon Equity Fund L.P. representing 27,744 shares of Common Stock, which shall be deposited with the Escrow Agent or its nominee, accompanied by a stock power duly executed in blank, pursuant to the terms of the Escrow Agreement, (iii) a certificate registered in the name of Commerce Capital L.P. representing 60,794 shares of Common Stock, which shall be deposited with the Escrow Agent or its nominee, accompanied by a stock power duly executed in blank, pursuant to the terms of the Escrow Agreement, (iv) certificates registered in the name of such Member representing the MonsterDaata Securities that such Member shall be entitled to receive as set forth in Section 1.5(a)(ii) hereof (less that number of MonsterDaata Securities deposited with the Escrow Agent or its nominee referred to in clauses (i), (ii) and (iii) above). (d) The first sentence of Section 11 of the Merger Agreement is hereby amended and restated in its entirety to read as follows: 11. Closing. The closing of the Merger (the "Closing") shall occur concurrently with the Effective Time (the "Closing Date"). The Closing shall occur at the law offices of Greenberg Traurig, LLP referred to in Section 13.1 hereof. At the Closing, MonsterDaata shall (i) deliver to the Escrow Agent certificates representing the MonsterDaata Securities to be held pursuant to the Escrow Agreement pursuant to Section 1.7(b), (ii) deliver to each Member certificates representing the balance of the MonsterDaata Securities to be issued pursuant to Section 1.5(a)(ii) hereof directly to them pursuant to Section 1.7(b) hereof, and (iii) deliver to the Persons specified in Section 1.5A certificates representing the respective Warrants to be issued to such Persons pursuant to Section 1.5A directly to such Persons. 2 2. Effectiveness of Amendment. The undersigned do hereby give their written consent to this Amendment No. 1 to the Merger Agreement (this "Amendment"), effective as of the date first written above, in accordance with the foregoing provisions. 3. Confirmation of Partnership Agreement. Except as set forth in Paragraph 1 of this Amendment, the terms, conditions and agreements set forth in the Merger Agreement are hereby ratified and confirmed and shall continue in full force and effect. 4. Governing Law. This Amendment shall be governed by and construed in accordance with the laws of the State of New York, without regard to the conflict of laws provisions thereof. 5. Binding Effect. This Amendment shall inure to the benefit of and be binding upon the permitted successors and assigns of the parties hereto. 6. Counterparts. This Amendment may be executed in counterparts, each of which when so executed and delivered shall be deemed an original and all of which together shall constitute one and the same instrument. IN WITNESS WHEREOF, each of the parties hereto have caused this Amendment to be executed as a deed as of the date first written above. MONSTERDAATA, INC. NEIGHBORHOODFIND.COM LLC By: /s/ Samuel Petteway By: /s/ Peter Polimino ----------------------------- ------------------------------ Name: Samuel Petteway Name: Peter Polimino Title: Chief Executive Officer Title: Chief Operating Officer and President AVALON EQUITY FUND L.P. COMMERCE CAPITAL L.P. By: Avalon Equity Partners LLC, By: Commerce Equity Capital its sole general partner Corporation, its sole general partner By: /s/ Benjamin Brandes By: /s/ Rudy E. Ruark ----------------------- ----------------------- Name: Benjamin Brandes Name: Rudy E. Ruark Title: Manager Title: Vice President 3 EX-3 6 e753828.txt EXHIBIT 3.1 Exhibit 3.1 CERTIFICATE OF DESIGNATION, PREFERENCES AND RIGHTS OF 7% SERIES D CONVERTIBLE PREFERRED STOCK OF MONSTERDAATA, INC. MonsterDaata, Inc., a corporation organized and existing under the laws of the State of Delaware (the "Company"), by its President and Chief Executive Officer, does hereby certify that, pursuant to authority conferred upon the Board of Directors by Article Four of the Certificate of Incorporation of the Company, the Board of Directors of the Company, by unanimous written consent, has duly adopted resolutions providing for the issuance of up to 360,000 shares of 7% Series D Convertible Preferred Stock at an issuance price of $10.00 per share (the "Original Purchase Price") and setting forth the voting powers, designation, preferences and relative, participating, optional and other special rights, and the qualifications, limitations and restrictions thereof, which resolution is as follows: RESOLVED, that pursuant to the authority vested in the Board of Directors of the Company in accordance with the provisions of its Certificate of Incorporation, as amended, there be, and hereby is, created out of the class of 10,000,000 shares of preferred stock of the Company authorized by Article Four of its Certificate of Incorporation, a series of preferred stock of the Company with the following voting powers, designation, preferences and relative, participating, optional and other special rights, and qualifications, limitations and restrictions: 1. Designation and Number of Shares. 360,000 shares of preferred stock (the "Shares") are hereby designated as 7% Series D Convertible Preferred Stock (the "Series D Preferred Stock"). 2. Liquidation. (a) Upon any liquidation, dissolution or winding up of the Company, whether voluntary or involuntary ("Liquidation"), the holders of record of the shares of the Series D Preferred Stock shall be entitled to receive, immediately after any distributions required by the Company's Certificate of Incorporation and any certificate(s) of designation, powers, preferences and rights in respect of any securities of the Company having priority over the Series D Preferred Stock with respect to the distribution of the assets of the Company upon Liquidation, and before and in preference to any distribution or payment of assets of the Company or the proceeds thereof may be made or set apart with respect to any securities of the Company over which the Series D Preferred Stock has priority with respect to the distribution of the assets of the Company upon Liquidation ("Junior Securities"), an amount in cash with respect to each share of Series D Preferred Stock held by such holders, equal to $20.00 per share (subject to adjustment in the event of stock splits, combinations or similar events) plus all accrued and unpaid dividends on such share as of the date of Liquidation. If, upon such Liquidation, the assets of the Company available for distribution to the holders of Series D Preferred Stock and any securities of the Company having equal priority with the Series D Preferred Stock with respect to the distribution of the assets of the Company upon Liquidation ("Parity Securities") shall be insufficient to permit payment in full to the holders of the Series D Preferred Stock and Parity Securities, then the entire assets and funds of the Company legally available for distribution to such holders and the holders of the Parity Securities then outstanding shall be distributed ratably among the holders of the Series D Preferred Stock and Parity Securities based upon the proportion the total amount distributable on each share upon liquidation bears to the aggregate amount available for distribution on all shares of the Series D Preferred Stock and of such Parity Securities, if any. (b) Upon the completion of the distributions required by paragraph (a) of this Section 2, if assets remain in the Company, they shall be distributed to holders of Junior Securities in accordance with the Company's Certificate of Incorporation and any applicable certificate(s) of designation, powers, preferences and rights. (c) For purposes of this Section 2, a merger or consolidation or a sale of all or substantially all of the assets of the Company shall be considered a Liquidation except in the event that in such a transaction, the holders of the Series D Preferred Stock receive securities of the surviving corporation having substantially similar rights as the Series D Preferred Stock. 3. Dividends. (a) Subject to the rights of any other series of Preferred Stock that may from time to time come into existence, the holders of shares of Series D Preferred Stock shall be entitled to receive, out of any assets legally available therefor, annual cumulative dividends on each share of Series D Preferred Stock equal to 7% of the Original Purchase Price, which dividends shall be payable in cash or additional shares of Series D Preferred Stock (valued as determined below) as determined by the Board of Directors of the Company in its sole discretion. The first such dividend shall be paid on July 31, 2002. The amount of such initial dividend, and any other dividend payable on the Series D Preferred Stock for any partial dividend period, shall be computed on the basis of a 360-day year consisting of twelve 30-day months. Dividends will be payable to holders of record as they appear in the stockholder records of the Company at the close of business on the applicable record date, which shall be the 15th day of June of each year (the "Dividend Payment Date") or on such other date designated by the Board of Directors for the payment of dividends that is not more than 30 nor less than 10 days prior to the Dividend Payment Date. With respect to any given year, no dividends (other than a dividend payable solely in Common Stock, par value $.01 per share, of the Company ("Common Stock")) shall be paid upon, or declared and set apart for, any shares of Common Stock or any other securities of the Company over which the Series D Preferred Stock has priority with respect to the payment of dividends if the Board of Directors of the Company shall have failed duly and lawfully to declare and pay in full a cash dividend to the holders of Series D Preferred Stock with respect to such year in the amount described above. If such dividends on the Series D Preferred Stock shall not have been paid or set apart in full for the Series D Preferred Stock, the aggregate deficiency shall be cumulative and shall be fully paid or set apart for payment prior to the payment of any dividend by the Company (other than a dividend payable solely in Common Stock) with respect to Common Stock or any other securities of the Company over which the Series D Preferred Stock has priority with respect to the payment of dividends. Accumulations of dividends on the Series D Preferred Stock shall not bear interest. For purposes of the first -2- sentence of this Section 3 only, shares of Series D Preferred Stock issued as dividends shall be valued at the greater of the Original Purchase Price and the aggregate current market value (as determined pursuant to Section 3(b)) of the Common Stock into which such shares are convertible as of the date of declaration of the dividend in question. (b) For the purposes of any computation pursuant to Section 3(a), the current market price per share of Common Stock at any date shall be deemed to be the average of the daily closing prices for the 15 consecutive business days prior to the day in question. The closing price for each day shall be the last sales price or in case no sale takes place on such day, the average of the closing high bid and low asked prices, in either case (i) as officially quoted by the Nasdaq SmallCap Market or the Nasdaq National Market or such other market on which the Common Stock is then listed for trading, or (ii) if, in the reasonable judgment of the Board of Directors of the Company, the Nasdaq SmallCap Market or the Nasdaq National Market is no longer the principal United States market for the Common Stock, then as quoted on the principal United States market for the Common Stock, as reasonably determined by the Board of Directors of the Company, or (iii) if, in the reasonable judgment of the Board of Directors of the Company, there exists no principal United States market for the Common Stock, then as reasonably determined by the Board of Directors of the Company. 4. Conversion Rights Each holder of record of shares of the Series D Preferred Stock shall have the right to convert all or any part of such holder's share of Series D Preferred Stock into Common Stock as follows: (a) Optional Conversion. Subject to and upon compliance with the provisions of this Section 4, the holder of any shares of Series D Preferred Stock shall have the right at such holder's option, at any time or from time to time, to convert any of such shares of Series D Preferred Stock into fully paid and nonassessable shares of Common Stock determined by dividing (A) the aggregate Original Purchase Price of such shares of Series D Preferred Stock by (B) the Conversion Price (as defined in Section (4)(c) below) in effect on the Conversion Date (as defined in Section 4(d) below) upon the terms hereinafter set forth. (b) Automatic Conversion. Each outstanding share of Series D Preferred Stock shall automatically be converted, without any further act of the Company or its stockholders, into fully paid and nonassessable shares of Common Stock at the Conversion Price then in effect upon: (i) the closing of a public offering of the Common Stock raising gross proceeds in excess of $20.0 million at an issuance price in excess of $10.00 for each share of Common Stock, (ii) the completion of a private placement of Common Stock raising gross proceeds in excess of $20.0 million at an issuance price in excess of $10.00 for each share of Common Stock (each, a "Qualified Offering"), or (iii) the conclusion of the twentieth consecutive trading day with respect to which the closing bid price for the Common Stock on a national securities exchange on which the Common Stock is traded (including, without limitation, the Nasdaq National Market and the Nasdaq Small Cap Market) was at least $10.00 per share; provided, however, that (A) the issuance of any Common Stock pursuant to this Section 4(b)(iii) is registered under the Securities Act of 1933, as amended, and (B) such Common Stock is not subject to any "lock-up" agreement restricting the resale thereof. -3- (c) Conversion Price. Each share of the Series D Preferred Stock shall be convertible into that number of fully paid and non-assessable shares of Common Stock of the Company equal to the Original Purchase Price divided by the conversion price in effect at the time of conversion (the "Conversion Price"), determined as hereinafter provided. The Conversion Price shall initially be $1.25 per share; the number of shares of Common Stock into which each share of Preferred Stock is convertible is herein referred to as the "Conversion Rate." (d) Mechanics of Conversion. Before any holder of Series D Preferred Stock shall be entitled to convert the same into shares of Common Stock, such holder shall surrender the certificate or certificates therefor, duly endorsed, at the office of the Company or of any transfer agent for the Series D Preferred Stock, and shall give written notice to the Company at its principal corporate office, of the election to convert the same and shall state therein the name or names in which the certificate or certificates for shares of Common Stock are to be issued. The Company shall, as soon as practicable thereafter, issue and deliver at such office to such holder of Series D Preferred Stock, or to the nominee or nominees of such holder, a certificate or certificates for the number of shares of Common Stock to which such holder shall be entitled as aforesaid. Conversion shall be deemed to have been effected on the date when delivery of notice of an election to convert and certificates for shares is made or on the date of the occurrence of the event specified in Section 4(b) as the case may be, and such date is referred to herein as the "Conversion Date." All Common Stock which may be issued upon conversion of the Series D Preferred Stock will, upon issuance, be duly issued, fully paid and non-assessable and free from all taxes, liens, and charges with respect to the issuance thereof. At all times that any shares of Series D Preferred Stock are outstanding, the Company shall have authorized and shall have reserved for the purpose of issuance upon such conversion into Common Stock of all Series D Preferred Stock, a sufficient number of shares of Common Stock to provide for the conversion of all outstanding shares of Series D Preferred Stock at the then effective Conversion Rate. Without limiting the generality of the foregoing, if, at any time, the Conversion Price is decreased, the number of shares of Common Stock authorized and reserved for issuance upon the conversion of the Series D Preferred Stock shall be proportionately increased. (e) Conversion Price Adjustments. The Conversion Price shall be subject to the adjustment provisions of Section 6 below. 5. Ranking. Series D Preferred Stock shall, with respect to distribution rights upon the Liquidation of the Company and dividend rights, rank (a) subject to clauses (b) and (c), senior to the Common Stock, the Series A Convertible Preferred Stock, par value $.01 per share, of the Company, the Series B Convertible Preferred Stock, par value $.01 per share, of the Company and all other preferred stock of the Company, (b) on a parity with the 7% Series C Convertible Preferred Stock, par value $.01 per share, of the Company (the "Series C Preferred Stock"), and (c) as applicable, junior to or on a parity with such preferred stock of the Company the terms of which expressly provide that such preferred stock will rank senior to or on a parity with Series D Preferred Stock. Without the consent of holders of at least 50% of the then outstanding shares of Series D Preferred Stock the Company shall not create, authorize or issue any other series of preferred stock which rank senior to or pari passu with the Series D Preferred Stock. -4- 6. Anti-Dilution Provisions. The Conversion Price in effect at any time and the number and kind of securities issuable upon the conversion of the Series D Preferred Stock shall be subject to adjustment from time to time upon the happening of certain events as follows: (a) Consolidation, Merger or Sale. If any consolidation or merger of the Company with another person, or the sale, transfer or lease of all or substantially all of its assets to another person shall be effected in such a way that holders of shares of Common Stock shall be entitled to receive stock, securities or assets with respect to or in exchange for their shares of Common Stock, then provision shall be made, in accordance with this Section 6(a), whereby each holder of shares of Series D Preferred Stock shall thereafter have the right to receive such securities or assets as would have been issued or payable with respect to or in exchange for the shares of Common Stock into which the shares of Series D Preferred Stock held by such holder were convertible immediately prior to the closing of such merger, sale, transfer or lease, as applicable. The Company will not effect any such consolidation, merger, sale, transfer or lease unless prior to the consummation thereof the successor entity (if other than the Company) resulting from such consolidation or merger or the entity purchasing or leasing such assets shall assume by written instrument (i) the obligation to deliver to the holders of Series D Preferred Stock such securities or assets as, in accordance with the foregoing provisions, such holders may be entitled to purchase, and (ii) all other obligations of the Company hereunder. The provisions of this Section 6(a) shall similarly apply to successive mergers, sales, transfers or leases. (b) Common Stock Dividends, Subdivisions, Combinations, etc. In case the Company shall hereafter (i) declare a dividend or make a distribution on its outstanding shares of Common Stock in shares of Common Stock, (ii) subdivide or reclassify its outstanding shares of Common Stock into a greater number of shares, or (iii) combine or reclassify its outstanding shares of Common Stock into a smaller number of shares, the Conversion Price in effect at the time of the record date for such dividend or distribution or of the effective date of such subdivision, combination or reclassification shall be adjusted so that it shall equal the price determined by multiplying the Conversion Price by a fraction, the denominator of which shall be the number of shares of Common Stock outstanding after giving effect to such action, and the numerator of which shall be the number of shares of Common Stock outstanding immediately prior to such action. Such adjustment shall be made successively whenever any event listed above shall occur. (c) Discounted Warrants or Rights. (i) In case the Company shall fix a record date for the issuance of rights or warrants to all holders of its Common Stock entitling them to subscribe for or purchase shares of Common Stock (or securities convertible into Common Stock) at a price (the "Subscription Price") (or having a conversion price per share) less than the current market price on such record date, the Conversion Price shall be adjusted so that the same shall equal the price determined by multiplying the Conversion Price in effect immediately prior to the date of such issuance by a fraction, the numerator of which shall be the sumof the number of shares of Common Stock outstanding immediately prior to the issuance of such rights or warrants and the number of shares of Common Stock which the aggregate consideration to be received in respect of such rights or warrants (including without limitation, consideration to be received upon the issuance and/or exercise of such -5- rights or warrants) would purchase at such current market price per share of the Common Stock, and the denominator of which shall be the sum of the number of shares of Common Stock outstanding immediately prior to such issuance and the number of shares of Common Stock of the Company deliverable upon the exercise of such rights or warrants at the initial exercise price or rate. (ii) Notwithstanding the provisions of Section 6(c)(i), in case the Company shall fix a record date for the issuance of rights or warrants to all holders of its Common Stock entitling them to subscribe for or purchase shares of Common Stock (or securities convertible into Common Stock) at a Subscription Price (or having a conversion price per share) less than the Conversion Price as of such record date, the Conversion Price shall be adjusted so that the same shall equal such Subscription Price. (iii) Adjustments to the Conversion Price pursuant to this Section 6(c) shall be made successively whenever rights or warrants of the type described in this Section 6(c) are issued and shall become effective immediately after the record date for the determination of shareholders entitled to receive such rights or warrants; and to the extent that shares of Common Stock are not delivered (or securities convertible into Common Stock are not delivered) after the expiration of rights or warrants in respect of which an adjustment to the Conversion Price was made pursuant to Section 6(c)(i), the Conversion Price shall be readjusted to the Conversion Price which would then be in effect had the adjustments made upon the issuance of such rights or warrants been made upon the basis of delivery of only the number of shares of Common Stock (or securities convertible into Common Stock) actually delivered. (d) Distributions of Certain Assets. In case the Company shall hereafter distribute to the holders of its Common Stock evidences of its indebtedness or assets (excluding cash dividends or distributions and dividends or distributions referred to in Section 6(b) above) or subscription rights or warrants (excluding those referred to in Section 6(c) above), then in each such case the Conversion Price in effect thereafter shall be determined by multiplying the Conversion Price in effect immediately prior thereto by a fraction, the numerator of which shall be the total number of shares of Common Stock outstanding multiplied by the current market price per share of Common Stock, less the fair market value (as determined by the Company's Board of Directors) of said assets or evidences of indebtedness so distributed or of such rights or warrants, and the denominator of which shall be the total number of shares of Common Stock outstanding multiplied by such current market price per share of Common Stock. Such adjustment shall be made successively whenever such a record date is fixed. Such adjustment shall be made whenever any such distribution is made and shall become effective immediately after the record date for the determination of shareholders entitled to receive such distribution. (e) Discounted Common Stock. (i) Subject to Section 6(e)(iv), in case the Company shall hereafter issue shares of its Common Stock for a consideration per share (the "Offering Price") less than the current market price, the Conversion Price shall be adjusted immediately thereafter so that it shall equal the price determined by multiplying the Conversion Price in effect immediately prior thereto by a fraction, the numerator of which shall be the sum -6- of the number of shares of Common Stock outstanding immediately prior to the issuance of such additional shares and the number of shares of Common Stock which the aggregate consideration received for the issuance of such additional shares would purchase at such current market price per share of Common Stock, and the denominator of which shall be the number of shares of Common Stock outstanding immediately after the issuance of such additional shares. (ii) Notwithstanding the provisions of Section 6(e)(i), subject to Section 6(e)(iv), in case the Company shall hereafter issue shares of its Common Stock for an Offering Price less than the then applicable Conversion Price, the Conversion Price shall be adjusted immediately thereafter so that it shall equal such Offering Price. (iii) Adjustments to the Conversion Price pursuant to this Section 6(e) shall be made successively whenever an issuance of shares triggering such an adjustment is made. (iv) Notwithstanding anything to the contrary in this Section 6(e), no adjustment to the Conversion Price shall be made pursuant to this Section 6(e) in the case of shares issued (A) in any of the transactions described in Section 6(b) above, (B) upon exercise of options granted to the Company's officers, directors, employees and consultants under a plan or plans adopted by the Company's Board of Directors and approved by its shareholders, if such shares would otherwise be included in this Section 6(e), (but only to the extent that the aggregate number of shares excluded hereby and issued after the date hereof, shall not exceed 15% of the Company's Common Stock outstanding, on a fully diluted basis, at the time of any issuance), (C) upon exercise of options, warrants, convertible securities and convertible debentures outstanding as of the date hereof, (D) in respect of the conversion of the Shares, (E) to shareholders of any corporation which merges into the Company in proportion to their stock holdings of such corporation immediately prior to such merger, upon such merger, (F) issued in a private placement through Commonwealth Associates, L.P., as placement agent, or upon exercise or conversion of any securities issued in or in connection with such a private placement (including agent, consulting or advisory warrants), (G) issued in a private placement with respect to which less than 1000 shares are issued or where the Offering Price (as defined below) is at least 90% of the current market price, (H) issued in a bona fide public offering pursuant to a firm commitment underwriting, or (I) issued in connection with an acquisition of a business or technology which has been approved by a majority of the Company's outside directors but only if no adjustment is required pursuant to any other specific subsection of this Section 6 (without regard to Section 6(i) below) with respect to the transaction giving rise to such rights. (f) Discounted Convertible Stock. (i) Subject to Section 6(f)(iv), in case the Company shall hereafter issue any securities convertible into or exchangeable for its Common Stock for a consideration per share of Common Stock (the "Exchange Price") initially deliverable upon conversion or exchange of such securities (determined as provided in Section 6 (h) below) less than the current market price, the Conversion Price shall be adjusted -7- immediately thereafter so that it shall equal the price determined by multiplying the Conversion Price in effect immediately prior thereto by a fraction, the numerator of which shall be the sum of the number of shares of Common Stock outstanding immediately prior to the issuance of such securities and the number of shares of Common Stock which the aggregate consideration received for such securities would purchase at such current market price per share of Common Stock, and the denominator of which shall be the sum of the number of shares of Common Stock outstanding immediately prior to such issuance and the maximum number of shares of Common Stock of the Company deliverable upon conversion of or in exchange for such securities at the initial conversion or exchange price or rate. (ii) Notwithstanding the provisions of Section 6(f)(i), subject to Section 6(f)(iv), in case the Company shall hereafter issue any securities convertible into or exchangeable for its Common Stock for an Exchange Price initially deliverable upon conversion or exchange of such securities (determined as provided in Section 6(h) below) less than the then applicable Conversion Price, the Conversion Price shall be adjusted immediately thereafter so that it shall equal such Exchange Price. (iii) Adjustments to the Conversion Price pursuant to this Section 6(f) shall be made successively whenever an issuance of shares triggering such an adjustment is made. (iv) Notwithstanding anything to the contrary in this Section 6(f), no adjustment to the Conversion Price shall be made pursuant to this Section 6(f) in the case of securities issued in transactions described in Sections 6(c), 6(d) and 6(e)(iv)(A) through (H) above (with any reference in Sections 6(e)(iv)(A) through (H) to price or quantity of shares issued being understood, for purposes of this Section 6(f)(iv), to refer to the aggregate price or quantity, as applicable, of the shares of Common Stock into which such securities are convertible or exchangeable). (g) Adjustment of Conversion Shares. Whenever the Conversion Price is adjusted pursuant to Sections 6(b), (c), (d), (e) and (f) above and (k) below, the number of Conversion Shares issuable upon conversion of the Series D Preferred Stock shall simultaneously be adjusted by multiplying the number of Conversion Shares initially issuable upon conversion of the Series D Preferred Stock by the Conversion Price in effect on the date hereof and dividing the product so obtained by the Conversion Price, as adjusted. (h) Computation of Certain Consideration. For purposes of any computation respecting consideration received pursuant to Sections 6(e) and (f) above, the following shall apply: (i) in the case of the issuance of shares of Common Stock for cash, the consideration shall be the amount of such cash, provided that in no case shall any deduction be made for any commissions, discounts or other expenses incurred by the Company for any underwriting of the issue or otherwise in connection therewith; -8- (ii) in the case of the issuance of shares of Common Stock for a consideration in whole or in part other than cash, the consideration other than cash shall be deemed to be the fair market value thereof as determined in good faith by the Board of Directors of the Company (irrespective of the accounting treatment thereof), whose determination shall be conclusive; and (iii) in the case of the issuance of securities convertible into or exchangeable for shares of Common Stock, the aggregate consideration received therefor shall be deemed to be the consideration received by the Company for the issuance of such securities plus the additional minimum consideration, if any, to be received by the Company upon the conversion or exchange thereof (the consideration in each case to be determined in the same manner as provided in clauses (i) and (ii) of this Section 6(h)). (i) Computation of Market Price. For the purpose of any computation under Sections 6 (c), (d), (e) and (f) above, the current market price per share of Common Stock at any date shall be deemed to be the average of the daily closing prices for the 30 consecutive business days prior to the day in question. The closing price for each day shall be the last sales price or in case no sale takes place on such day, the average of the closing high bid and low asked prices, in either case (i) as officially quoted by the Nasdaq SmallCap Market or the Nasdaq National Market or such other market on which the Common Stock is then listed for trading, or (ii) if, in the reasonable judgment of the Board of Directors of the Company, the Nasdaq SmallCap Market or the Nasdaq National Market is no longer the principal United States market for the Common Stock, then as quoted on the principal United States market for the Common Stock, as reasonably determined by the Board of Directors of the Company, or (iii) if, in the reasonable judgment of the Board of Directors of the Company, there exists no principal United States market for the Common Stock, then as reasonably determined by the Board of Directors of the Company. (j) Notice of Adjustment. Whenever the Conversion Price is adjusted, as herein provided, the Company shall promptly but no later than 10 days after any request for such an adjustment by the Holder, cause a notice setting forth the adjusted Conversion Price and adjusted number of Conversion Shares issuable upon exercise of each share of Series D Preferred Stock, and, if requested, information describing the transactions giving rise to such adjustments, to be mailed to the Holders at their last addresses appearing in the Share Register, and shall cause a certified copy thereof to be mailed to its transfer agent, if any. The Company may retain a firm of independent certified public accountants selected by the Board of Directors (who may be the regular accountants employed by the Company) to make any computation required by this Section 6, and a certificate signed by such firm shall be conclusive evidence of the correctness of such adjustment. (k) Receipt of Securities Other than Common Stock. In the event that at any time, as a result of an adjustment made pursuant to Section 6(b) above, the Holders of the Series D Preferred Stock thereafter shall become entitled to receive any shares of the Company, other than Common Stock, thereafter the number of such other shares so receivable upon conversion of the Series D Preferred Stock shall be subject to adjustment from time to time in a manner and on terms as nearly equivalent as practicable to the provisions with respect to the Common Stock contained in Sections 6(a) to (h), inclusive above. -9- (l) Waiver of Rights. Notwithstanding anything to the contrary herein, in the event any of the anti-dilution rights set forth in Section 6 of the Certificate of Designation, Preferences and Rights of the Series C Preferred Stock are duly waived or modified by the holders thereof, the analogous rights set forth in Section 6 hereof shall be deemed similarly waived or modified without any further action on the part of the holders of Series D Preferred Stock. 7. Voting Rights. Except as expressly provided to the contrary herein or pursuant to applicable law, the holders of Series D Preferred Stock shall be entitled to vote, together with the holders of Common Stock and other voting securities as one class, on all matters as to which holders of Common Stock shall be entitled to vote, in the same manner and with the same effect as such Common Stock holders. In any such vote, each share of Series D Preferred Stock shall entitle the holder thereof to the number of votes per share that equals the number of whole shares of Common Stock into which each such share of Series D Preferred Stock is then convertible. 8. Covenants of Company The Company covenants and agrees that, so long as the Shares are outstanding, it will perform the obligations set forth in this Section 8: (a) Taxes and Levies. The Company will promptly pay and discharge all taxes, assessments, and governmental charges or levies imposed upon the Company or upon its income and profits, or upon any of its property, before the same shall become delinquent, as well as all claims for labor, materials and supplies which, if unpaid, might become a lien or charge upon such properties or any part thereof; provided, however, that the Company shall not be required to pay and discharge any such tax, assessment, charge, levy or claim so long as the validity thereof shall be contested in good faith by appropriate proceedings and the Company shall set aside on its books adequate reserves in accordance with generally accepted accounting principles ("GAAP") with respect to any such tax, assessment, charge, levy or claim so contested; (b) Maintenance of Existence. The Company will do or cause to be done all things reasonably necessary to preserve and keep in full force and effect its corporate existence, rights and franchises and comply with all laws applicable to the Company, except where the failure to comply would not have a material adverse effect on the Company; (c) Maintenance of Property. The Company will at all times maintain, preserve, protect and keep its property used or useful in the conduct of its business in good repair, working order and condition, and from time to time make all needful and proper repairs, renewals, replacements and improvements thereto as shall be reasonably required in the conduct of its business; (d) Insurance. The Company will, to the extent necessary for the operation of its business, keep adequately insured by financially sound reputable insurers, all property of a character usually insured by similar corporations and carry such other insurance as is usually carried by similar corporations; -10- (e) Books and Records. The Company will at all times keep true and correct books, records and accounts reflecting all of its business affairs and transactions in accordance with GAAP; and (f) Notice of Certain Events. The Company will give prompt written notice (with a description in reasonable detail) to the holders of Series D Preferred Stock in the event the Company shall: (i) become insolvent or generally fail or be unable to pay, or admit in writing its inability to pay, its debts as they become due; (ii) apply for, consent to, or acquiesce in, the appointment of a trustee, receiver, sequestrator or other custodian for the Company or any of its property, or make a general assignment for the benefit of creditors; (iii) in the absence of such application, consent or acquiesce in, permit or suffer to exist the appointment of a trustee, receiver, sequestrator or other custodian for the Company or for any part of its property; or (iv) permit or suffer to exist the commencement of any bankruptcy, reorganization, debt arrangement or other case or proceeding under any bankruptcy or insolvency law, or any dissolution, winding up or liquidation proceeding, in respect of the Company, and, if such case or proceeding is not commenced by the Company or converted to a voluntary case, such case or proceeding shall be consented to or acquiesced in by the Company or shall result in the entry of an order for relief. 9. Reservation of Shares. The Company shall at all times reserve and keep available and free of preemptive rights out of its authorized but unissued Common Stock, solely for the purpose of effecting the conversion of the Series D Preferred Stock pursuant to the terms hereof, such number of its shares of Common Stock (or other shares or other securities as may be required) as shall from time to time be sufficient to effect the conversion of all outstanding Series D Preferred Stock pursuant to the terms hereof. If at any time the number of authorized but unissued shares of Common Stock (or such other shares or other securities) shall not be sufficient to affect the conversion of all then outstanding Series D Preferred Stock, the Corporation shall promptly take such action as may be necessary to increase its authorized but unissued Common Stock (or other shares or other securities) to such number of shares as shall be sufficient for such purpose. 10. Miscellaneous. (a) There is no sinking fund with respect to the Series D Preferred Stock. (b) The shares of the Series D Preferred Stock shall not have any preferences, voting powers or relative, participating, optional, preemptive or other special rights except as set forth above in this Certificate of Designation, Preferences and Rights and in the Certificate of Incorporation of the Company. -11- (c) The holders of the Series D Preferred Stock shall be entitled to receive all communications sent by the Company to the holders of the Common Stock. IN WITNESS WHEREOF, MonsterDaata, Inc. has caused this Certificate to be signed by its President and Chief Executive Officer, on this 31st day of July, 2001, and such person hereby affirms under penalty of perjury that this Certificate is the act and deed of MonsterDaata, Inc. and that the facts stated herein are true and correct. MONSTERDAATA, INC. By: /s/ Samuel B. Petteway, Jr ------------------------------------- Samuel B. Petteway, Jr. President and Chief Executive Officer -12- EX-10 7 e765278.txt EXHIBIT 10.1 Exhibit 10.1 THE WARRANT REPRESENTED BY THIS CERTIFICATE AND THE SECURITIES ISSUABLE UPON EXERCISE HEREOF HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE "ACT"). NEITHER THIS WARRANT NOR SUCH SECURITIES MAY BE TRANSFERRED EXCEPT (A) PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT UNDER THE ACT AND ANY APPLICABLE STATE SECURITIES LAWS OR (B) UPON RECEIPT BY THE ISSUER OF AN OPINION OF COUNSEL, WHICH OPINION OF COUNSEL SHALL BE REASONABLY SATISFACTORY TO THE ISSUER, TO THE EFFECT THAT SUCH TRANSFER IS EXEMPT FROM REGISTRATION UNDER THE ACT AND SUCH STATE SECURITIES LAWS. WARRANT TO PURCHASE COMMON STOCK OF MONSTERDAATA, INC. WARRANT NO. D-___ THIS CERTIFIES that, for value received, _________________________________, or its permitted assigns registered on the books of the Company (collectively, the "Holder"), is entitled to purchase from MonsterDaata, Inc., a Delaware corporation (the "Company"), at any time, and from time to time, during the exercise period referred to in Section 1 hereof, ___________________ shares (the "Warrant Shares") of Common Stock, par value $.01 per share (the "Common Stock"), of the Company. The purchase price for each Warrant Share is $1.25 (as may be adjusted, the "Warrant Share Price"). Securities issuable upon exercise of this Warrant and the price payable therefor are subject to adjustment from time to time as hereinafter set forth. As used herein, the term "Warrant" shall include any warrant or warrants hereafter issued in consequence of the exercise of this Warrant in part or transfer of this Warrant in whole or in part. 1. Exercise; Payment for Ownership Interest. The Company shall have reserved sufficient Common Stock (given all other Common Stock share reservations) to allow for the exercise of this Warrant. (a) Upon the terms and subject to the conditions set forth herein, this Warrant may be exercised in whole or in part by the Holder hereof at any time, or from time to time, on or after the date hereof and prior to 5:30 p.m., New York time, on July 31, 2003, by presentation and surrender of this Warrant to the principal offices of the Company, together with the Purchase Form annexed hereto, duly executed, and accompanied by payment to the Company of an amount equal to the Warrant Share Price multiplied by the number of Warrant Shares as to which this Warrant is then being exercised. Moreover, any transfer of Warrant Shares obtained by the Holder in exercise of this Warrant is subject to the requirement that such securities be registered under the Securities Act of 1933, as amended (the "1933 Act"), and applicable state securities laws or exempt from registration under such laws. The Holder of this Warrant shall be deemed to be a shareholder owning the Warrant Shares as to which this Warrant is exercised in accordance herewith effective immediately after the close of business on the date on which the Holder shall have delivered to the Company this Warrant in proper form for exercise and payment by certified or official bank check or wire transfer of the cash purchase price for the number of Warrant Shares as to which this Warrant is then being exercised, or by delivery to the Company of securities of the Company having a value equal to the cash purchase price for such number of Warrant Shares determined as of the date of delivery. (b) All or any portion of the Warrant Share Price may be paid by surrendering Warrants effected by presentation and surrender of this Warrant to the Company with a Cashless Exercise Form annexed hereto duly executed (a "Cashless Exercise"). Such presentation and surrender shall be deemed a waiver by the Company, of the Holder's obligation to pay all or any portion of the aggregate Warrant Share Price. In the event of a Cashless Exercise, the Holder shall exchange its Warrant for that number of shares of Common Stock determined by multiplying the number of Warrant Shares for which the Holder desires to exercise this Warrant by a fraction, the numerator of which shall be the difference between the then current market price per share of the Common Stock and the Warrant Share Price, and the denominator of which shall be the then current market price per share of Common Stock. For purposes of any computation under this Section 1(b), the then current market price per share of Common Stock at any date shall be deemed to be the average for the ten consecutive business days immediately prior to the Cashless Exercise of the daily closing prices of the Common Stock on the principal national securities exchange on which the Common Stock is admitted to trading or listed, including the National Association of Securities Dealer's Over-The-Counter Bulletin Board, or if not listed or admitted to trading on any such exchange, the closing prices as reported by the Nasdaq National Market, or if not then listed on the Nasdaq National Market, the average of the highest reported bid and lowest reported asked prices as reported by the National Association of Securities Dealers, Inc. Automated Quotations System ("Nasdaq") or if not then publicly traded, the fair market price of the Common Stock as determined by the Board of Directors of the Company in good faith. (c) If this Warrant shall be exercised in part only, the Company shall, upon surrender of this Warrant for cancellation, execute and deliver a new Warrant evidencing the rights of the Holder thereof to purchase the balance of the Warrant Shares purchasable hereunder as to which this Warrant has not been exercised. If this Warrant is exercised in part, such exercise shall be for a whole number of Warrant Shares. Upon any exercise and surrender of this Warrant, the Company (i) will issue and deliver to the Holder a certificate or certificates in the name of the Holder for the largest whole number of Warrant Shares to which the Holder shall be entitled and, if this Warrant is exercised in whole, in lieu of any fractional Warrant Share to which the Holder otherwise might be entitled, cash in an amount equal to the fair value of such fractional Warrant Share (determined in such reasonable and equitable manner as the Board of Directors of the Company shall in good faith decide), and (ii) will deliver to the Holder such other securities, properties and cash which the Holder may be entitled to receive upon such exercise, or the proportionate part thereof if this Warrant is exercised in part, pursuant to the provisions of this Warrant. 2. Adjustments. Securities issuable upon exercise of this Warrant and the Warrant Share Price shall be subject to adjustment from time to time as follows: 2 2.1 Reorganization, Reclassification, Consolidation, Merger or Sale. If any capital reorganization or reclassification of the Company, or any consolidation or merger of the Company with another person, or the sale, transfer or lease of all or substantially all of its assets to another person shall be effected in such a way that holders of shares of Common Stock shall be entitled to receive stock, securities or assets with respect to or in exchange for their shares, then provision shall be made, in accordance with this Section 2.1, whereby the Holder hereof shall thereafter have the right to purchase and receive, upon the basis and upon the terms and conditions specified in this Warrant Agreement and in addition to or in exchange for, as applicable, the Warrant Shares subject to this Warrant immediately theretofore purchasable and receivable upon the exercise of the rights represented hereby, such securities or assets as would have been issued or payable with respect to or in exchange for the aggregate Warrant Shares immediately theretofore purchasable and receivable upon the exercise of the rights represented hereby if exercise of the Warrant had occurred immediately prior to such reorganization, reclassification, consolidation, merger or sale. The Company will not effect any such consolidation, merger, sale, transfer or lease unless prior to the consummation thereof the successor entity (if other than the Company) resulting from such consolidation or merger or the entity purchasing or leasing such assets shall assume by written instrument (i) the obligation to deliver to the Holder such securities or assets as, in accordance with the foregoing provisions, the Holder may be entitled to purchase, and (ii) all other obligations of the Company under this Warrant. The provisions of this Section 2.1 shall similarly apply to successive consolidations, mergers, exchanges, sales, transfers or leases. 2.2 Stock Dividends and Securities Distributions. If, at any time or from time to time after the date of this Warrant, the Company shall distribute to the holders of shares of Common Stock (i) securities or (ii) property, other than cash, without fair payment therefor, then, and in each such case, the Holder, upon the exercise of this Warrant, shall be entitled to receive such securities or property which the Holder would have held on the date of such exercise if, on the date of this Warrant, the Holder had been the holder of record of the shares of Common Stock acquireable upon such exercise and, during the period from the date of this Warrant to and including the date of such exercise, had retained such shares of Common Stock and the securities and property receivable by the Holder during such period, subject, however, to the Holder agreeing to any conditions to such distribution as were required of all other holders of shares of Common Stock in connection with such distribution. If the securities to be distributed by the Company involve rights, warrants, options or any other form of convertible securities and the right to exercise or convert such securities would expire in accordance with its terms prior to the exercise of this Warrant, then the terms of such securities shall provide that such exercise or convertibility right shall remain in effect until thirty (30) days after the date the Holder of this Warrant receives such securities pursuant to the exercise hereof. 2.3 Other Adjustments. In addition to those adjustments set forth in Sections 2.1 and 2.2, but without duplication of the adjustments to be made under such Sections, if the Company: (i) pays a dividend or makes a distribution on its Common Stock in shares of its Common Stock; (ii) subdivides its outstanding shares of Common Stock into a greater number of shares; 3 (iii)combines its outstanding shares of Common Stock into a smaller number of shares; (iv) makes a distribution on its Common Stock in shares of its capital stock other than Common Stock; and/or (v) issues, by reclassification of its Common Stock, any shares of its capital stock; then the number and kind of Warrant Shares purchasable upon exercise of this Warrant shall be adjusted so that the Holder upon exercise hereof shall be entitled to receive the kind and number of Warrant Shares or other securities of the Company that the Holder would have owned or have been entitled to receive after the happening of any of the events described above had this Warrant been exercised immediately prior to the happening of such event or any record date with respect thereto. An adjustment made pursuant to this Section 2.3 shall become effective immediately after the record date in the case of a dividend or distribution and shall become effective immediately after the effective date in the case of a subdivision, combination or issuance. If, as a result of an adjustment made pursuant to this Section 2.3, the Holder of this Warrant shall become entitled to receive shares of two or more classes of capital stock or shares of Common Stock and any other class of capital stock of the Company, the Board of Directors (whose determination shall be conclusive and shall be described in a written notice to all holders of Warrants promptly after such adjustment) shall determine the allocation of the adjusted Warrant Share Price between or among shares of such classes of capital stock or shares of Common Stock and such other class of capital stock. The adjustment to the number of Warrant Shares purchasable upon the exercise of this Warrant described in this Section 2.3 shall be made each time any event listed in paragraphs (i) through (v) of this Section 2.3 occurs. Simultaneously with all adjustments to the number and/or kind of securities and property to be issued in connection with the exercise of this Warrant, the Warrant Share Price shall, subject to Section 12, also be appropriately and proportionately adjusted such that the amount determined by multiplying the number of Warrant Shares by the Warrant Share Price will be the same as before the adjustment. 2.4 Sale of Securities. If the Company, at any time after the date of this Warrant, issues additional Common Stock, convertible preferred stock, options, warrants, or other securities convertible into or exercisable for Common Stock other than securities currently outstanding as of the date hereof or issuable upon the conversion or exercise of any securities outstanding as of the date hereof, at a purchase price less than the Warrant Share Price in effect immediately prior to such issuance or sale, then the Warrant Share Price shall, subject to Section 12, be automatically reduced to such lower purchase price and the number of Warrant Shares shall be increased proportionately; provided, however, that no adjustment to the Warrant Share Price or the number of Warrant Shares shall be made pursuant to this Section 2.4 if (i) the Company grants options to employees, consultants, officers or directors of the Company pursuant to contracts or plans approved by the Board of Directors of the Company, (ii) the Company issues securities to a "strategic partner" as determined by the Board of Directors of the 4 Company, (iii) the Company issues securities pursuant to a strategic acquisition as determined by the Board of Directors, or (iv) if the Company issues up to an aggregate of 100,000 shares (as appropriately adjusted for stock splits, stock dividends and similar adjustments after the date hereof) of Common Stock (or convertible preferred stock, options, warrants or other securities convertible into or exercisable for Common Stock) at a purchase price less than the Warrant Share Price and not otherwise excepted pursuant to (i), (ii) or (iii) above. (a) For the purpose of making any adjustment in the Warrant Share Price as provided in this Section 2.4, the consideration received by the Company for any issue or sale of Common Stock will be computed: (i) to the extent it consists of cash, as the amount of cash received by the Company before deduction of any offering expenses payable by the Company and any underwriting or similar commissions, compensation, or concessions paid or allowed by the Company in connection with such issue or sale; (ii) to the extent it consists of property other than cash, at the fair market value of that property as determined in good faith by the Company's Board of Directors; and (iii) if Common Stock is issued or sold together with other stock or securities or other assets of the Company for a consideration which covers both, as the portion of the consideration so received that may be reasonably determined in good faith by the Company's Board of Directors to be allocable to such Common Stock. (b) If the Company (i) issues, grants or sells any rights or options to subscribe for, purchase, or otherwise acquire shares of Common Stock, or (ii) issues or sells any security convertible into shares of Common Stock, then, in each case, the price per share of Common Stock issuable on the exercise of the rights or options or the conversion of the securities will be determined by dividing (x) the total amount, if any, received or receivable by the Company as consideration for the granting or sale of the rights or options or the issue or sale of the convertible securities, plus the minimum aggregate amount of additional consideration payable to the Company on exercise or conversion of the securities, by (y) the maximum number of shares of Common Stock issuable on the exercise or conversion. Such granting or issue or sale will be considered to be an issue or sale for cash of the maximum number of shares of Common Stock issuable on exercise or conversion at the price per share determined under this Section 2.4, and the Warrant Share Price will be adjusted as above provided to reflect (on the basis of that determination) the issue or sale. No further adjustment of the Warrant Share Price will be made as a result of the actual issuance of shares of Common Stock on the exercise of any such rights or options or the conversion of any such convertible securities. (c) Upon the redemption or repurchase of any such securities or the expiration or termination of the right to convert into, exchange for, or exercise with respect to, Common Stock, the Warrant Share Price will be readjusted to such price as would have been obtained had the adjustment made upon their issuance been made upon the basis of the issuance of only the 5 number of such securities as were actually converted into, exchanged for, or exercised with respect to, Common Stock. If the purchase price or conversion or exchange rate provided for in any such security changes at any time, then, upon such change becoming effective, the Warrant Share Price then in effect will be readjusted to such price as would have been obtained had the adjustment made upon the issuance of such securities been made upon the basis of (i) the issuance of only the number of shares of Common Stock theretofore actually delivered upon the conversion, exchange or exercise of such securities, and the total consideration received therefor, and (ii) the granting or issuance, at the time of such change, of any such securities then still outstanding for the consideration, if any, received by the Company therefor and to be received on the basis of such changed price or rate. 2.5 Other Action Affecting Warrant Shares. If the Company takes any action affecting its shares of Common Stock after the date hereof, that would be covered by Sections 2.1, 2.2 or 2.3 but for the manner in which such action is taken or structured, other than an action described in Sections 2.1, 2.2 or 2.3 which would in any way diminish the value of this Warrant, then the Warrant Share Price shall, subject to Section 12, be adjusted in such manner as the Board of Directors of the Company shall in good faith determine to be equitable under the circumstances. 2.6 Notice of Adjustments. Upon the occurrence of each adjustment or readjustment of the Warrant Share Price pursuant to this Section 2, the Company at its expense will promptly compute such adjustment or readjustment in accordance with the terms of this Warrant and prepare a certificate setting forth such adjustment or readjustment and showing in detail the facts upon which such adjustment or readjustment is based. The Company will forthwith mail, by first class mail, postage prepaid, a copy of each such certificate to the Holder of this Warrant at the address of such Holder as shown on the books of the Company. 2.7 Other Notices. If at any time: (a) the Company shall (i) offer for subscription pro rata to the holders of shares of the Common Stock any additional equity in the Company or other rights; (ii) pay a dividend in additional shares of the Common Stock or distribute securities or other property to the holders of shares of the Common Stock (including, without limitation, evidences of indebtedness and equity and debt securities); or (iii) issue securities convertible into, or rights or Warrants to purchase, securities of the Company; (b) there shall be any capital reorganization or reclassification or consolidation or merger of the Company with, or sale, transfer or lease of all or substantially all of its assets to, another entity; or (c) there shall be a voluntary or involuntary dissolution, liquidation or winding up of the Company; then, in any one or more of said cases, the Company shall give, by first class mail, postage prepaid, to the Holder of this Warrant at the address of such Holder as shown on the books of the Company, (a) at least 15 days' prior written notice of the date on which the books of the Company shall close or a record shall be taken for such subscription rights, dividend, distribution 6 or issuance, and (b) in the case of any such reorganization, reclassification, consolidation, merger, sale, dissolution, liquidation or winding up, at least 15 days' prior written notice of the date when the same shall take place if no stockholder vote is required and at least 15 days' prior written notice of the record date for stockholders entitled to vote upon such matter if a stockholder vote is required. Such notice in accordance with the foregoing clause (a) shall also specify, in the case of any such subscription rights, the date on which the holders of shares of Common Stock shall be entitled to exercise their rights with respect thereto, and such notice in accordance with the foregoing clause (b) shall also specify the date on which the holders of shares of Common Stock shall be entitled to exchange their shares of Common Stock for securities or other property deliverable upon such reorganization, reclassification, consolidation, merger, sale, dissolution, liquidation or winding up, as the case may be. Failure to give the notice referred to herein shall not affect the validity or legality of the action which should have been the subject of the notice. 3. No Voting Rights. Except as otherwise provided herein, this Warrant shall not be deemed to confer upon the Holder any right to vote or to consent to or receive notice as a stockholder of the Company, as such, in respect of any matters whatsoever, or any other rights or liabilities as a stockholder, prior to the exercise hereof. 4. Warrants Transferable. This Warrant and all rights hereunder are transferable, in whole or in part, at the principal offices of the Company by the Holder hereof, upon surrender of this Warrant properly endorsed; provided, however, that without the prior written consent of the Company, this Warrant and all rights hereunder may be transferred only (i) to an affiliate of the initial Holder hereof or successor in interest to any such person in a transaction exempt from registration under the 1933 Act; or (ii) pursuant to the registration of this Warrant or the Warrant Shares under the 1933 Act or subsequent to one year from the date hereof under Rule 144 or other exemption from such registration. 5. Warrants Exchangeable; Loss, Theft, Destruction, Etc. This Warrant is exchangeable, upon surrender hereof by the Holder hereof at the principal offices of the Company, for new Warrants of like tenor representing in the aggregate the right to subscribe for and purchase the Warrant Shares which may be subscribed for and purchased hereunder, each such new Warrant to represent the right to subscribe for and purchase such Warrant Shares (not to exceed the maximum aggregate Warrant Shares which may be purchased hereunder) as shall be designated by such Holder hereof at the time of such surrender. Upon receipt of evidence satisfactory to the Company of the loss, theft, destruction or mutilation of this Warrant and, in the case of any such loss, theft or destruction, upon delivery of a bond or indemnity satisfactory to the Company, or, in the case of any such mutilation, upon surrender or cancellation of this Warrant, the Company will issue to the Holder hereof a new Warrant of like tenor, in lieu of this Warrant, representing the right to subscribe for and purchase the Warrant Shares which may be subscribed for and purchased hereunder. 6. Legends; Investment Representations. Any certificate evidencing the securities issued upon exercise of this Warrant shall bear a legend in substantially the following form: THE SECURITIES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE 7 "ACT"). SUCH SECURITIES MAY NOT BE TRANSFERRED EXCEPT (A) PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT UNDER THE ACT AND ANY APPLICABLE STATE SECURITIES LAWS OR (B) UPON RECEIPT BY THE ISSUER OF AN OPINION OF COUNSEL, WHICH OPINION OF COUNSEL SHALL BE REASONABLY SATISFACTORY TO THE ISSUER, TO THE EFFECT THAT SUCH TRANSFER IS EXEMPT FROM REGISTRATION UNDER THE ACT AND SUCH STATE SECURITIES LAWS. 7. Redemption. (a) This Warrant may be called by the Company with respect to 100% of the Warrant Shares at a price of $.01 per Warrant Share on thirty (30) days' notice (the "Notice") to the Holder if all of the following shall have occurred: (i) the average closing bid price of the Company's Common Stock for thirty (30) consecutive trading days exceeds 200% of the Warrant Share Price, as adjusted, at least ten days' prior to the Company sending the Notice to the Holder; and (ii) the Common Stock of the Company is trading on a national securities exchange or the Nasdaq SmallCap or National Market Systems; and (iii) a registration statement covering the Warrant Shares has been declared effective by the Securities and Exchange Commission and such registration statement remains effective thirty days prior to the date of the Notice and the Warrant Shares are not otherwise subject to any lock-up restrictions. 8. Modifications and Waivers. The terms of the Warrants may be amended, modified or waived by written agreement of the Company and the holders of warrants issued in connection with the "Offering" (as defined in the Subscription Agreement, dated as of the date hereof, between the Company and the initial Holder) representing a majority of the Common Stock represented by all such warrants then outstanding. 9. Miscellaneous. The Company shall pay all expenses and other charges payable in connection with the preparation, issuance and delivery of this Warrant and all substitute Warrants other than as set forth in this Section 9. The Holder shall pay all taxes (other than any issuance taxes, including, without limitation, documentary stamp taxes, transfer taxes and other governmental charges, which shall be paid by the Company) in connection with such issuance and delivery of the Warrants and the Warrant Shares. The Company shall maintain, at the office or agency of the Company maintained by the Company, books for the registration and transfer of the Warrant. 10. Reservation of Warrant Shares. The Company will at all times reserve and keep available, free from preemptive rights, out of the aggregate of its authorized but unissued Common Stock or its authorized and issued Common Stock held in its treasury, solely for the purpose of enabling it to satisfy any obligation to issue Warrant Shares upon exercise of this Warrant, the maximum number of shares of Common Stock which may then be deliverable upon the exercise of this Warrant. 8 The Company or, if appointed, the transfer agent for the Common Stock (the "Transfer Agent") and every subsequent transfer agent for any shares of the Company's capital stock issuable upon the exercise of any of the rights of purchase aforesaid will be irrevocably authorized and directed at all times to reserve such number of authorized shares as shall be required for such purpose. The Company will keep a copy of this Warrant on file with the Transfer Agent and with every subsequent transfer agent for any shares of the Company's capital stock issuable upon the exercise of the rights of purchase represented by this Warrant. The Company will furnish such Transfer Agent a copy of all notices of adjustments and certificates related thereto transmitted to the Holder pursuant to Section 2.6 hereof. The Company covenants that all Warrant Shares which may be issued upon exercise of this Warrant will, upon issue, be fully paid, nonassessable, free of preemptive rights and free from all taxes, liens, charges and security interests with respect to the issue thereof. 11. Adjustment of Number of Warrant Shares Issuable and Exercise Price. The number of Warrant Shares issuable upon the exercise of this Warrant and the Warrant Share Price are subject to adjustment from time to time upon the occurrence of the events enumerated in Section 2; provided, however, that the Warrant Share Price shall not be adjusted until such time as events shall have occurred requiring the adjustment of the then applicable Warrant Share Price by not less than 1% in the aggregate pursuant to Section 2. 12. Descriptive Headings and Governing Law. The descriptive headings of the several paragraphs of this Warrant are inserted for convenience only and do not constitute a part of this Warrant. This Warrant shall be construed and enforced in accordance with the laws of the State of New York, and the rights of the parties shall be governed by, the law of such state. IN WITNESS WHEREOF, this Warrant has been executed as of this 31st day of July, 2001. MONSTERDAATA, INC. By: ______________________________________ Samuel B. Petteway, Jr. President and Chief Executive Officer 9 PURCHASE FORM Dated:__________, ____ The undersigned hereby irrevocably elects to exercise the within Warrant to the extent of purchasing __________ Warrant Shares (as such Warrant Shares have been adjusted to date) and hereby makes payment of $__ in payment of the exercise price thereof. ----------------------------------------- 10 CASHLESS EXERCISE Dated:__________, ____ The undersigned irrevocably elects to exercise the within Warrant for __________ Warrant Shares (as such Warrant Shares have been adjusted to date) and hereby makes payment pursuant to the Cashless Exercise provision of the within Warrant, and directs that the payment of the Warrant Share Price be made by cancellation as of the date of exercise of a portion of the within Warrant in accordance with the terms and provisions of Section 1(b) of the within Warrant. ----------------------------------------- 11 EX-10 8 e763504.txt EXHIBIT 10.2 Exhibit 10.2 ASSUMPTION AND AMENDMENT AGREEMENT THIS ASSUMPTION AND AMENDMENT AGREEMENT ("Agreement") is made and entered as of the 31st day of July, 2001, by and between Commerce Capital, L.P., a Tennessee limited partnership ("Lender") and Monsterdaata, Inc., a Delaware corporation ("Monsterdaata"), as successor by merger to NeighborhoodFind.com, LLC, a Delaware limited liability company ("NFC"). WHEREAS, pursuant to a Loan Agreement dated as of June 13, 2000, as amended by Amendment No. 1 to Loan Agreement dated as of November 30, 2000 (collectively, the "Loan Agreement"), between Lender and NFC, the Lender made loans to NFC of $800,000 initially and $380,000 subsequently, which loans were evidenced by secured promissory notes in such amounts dated June 13, 2000 and November 30, 2000, respectively (such promissory notes collectively, the "Original Notes"), and secured by the Loan Documents, as defined in the Loan Agreement (capitalized terms used and not otherwise defined in this Agreement shall have the respective meanings set forth in the Loan Agreement); and WHEREAS, NFC and Monsterdaata, have entered into that certain Merger Agreement dated as of July 20, 2001, pursuant to which NFC will be merged with and into Monsterdaata (the "Merger"), as a result of which Monsterdaata will succeed to all rights and obligations of NFC under the Loan Documents; and WHEREAS, it is a condition precedent to Monsterdaata's obligations to consummate the Merger that Lender agree to amend certain of the Loan Documents; and WHEREAS, contemporaneously with execution of this Agreement, Monsterdaata has executed and delivered to Lender a Consolidated and Restated Secured Promissory Note, dated the date hereof, in the principal amount of $1,180,000 (the "Consolidated Note") reflecting certain amendments to which the parties have agreed; and WHEREAS, the parties desire to memorialize in writing the other modifications and amendments to which they have agreed. NOW, THEREFORE, in consideration of the premises, in order to induce Monsterdaata to consummate the Merger, and for other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, Lender and Monsterdaata hereby agree as follows: 1. Assumption and Global Amendments. Monsterdaata hereby confirms its assumption, by operation of law, of all of the obligations of NFC under each of the Loan Documents, except as amended by this Agreement. Pursuant to Section 7.4 of the Loan Agreement, Lender hereby consents to the assignment by NFC of its rights and the delegation of its duties under each of the Loan Documents, as amended hereby, to Monsterdaata. Each of the Loan Documents is hereby amended, by deleting in each place it appears "NeighborhoodFind.com, LLC, a Delaware limited liability company," and substituting in its place "Monsterdaata, Inc., a Delaware corporation." All references in any of the Loan Documents to "Borrower" shall, from and after the date hereof, be deemed references to Monsterdaata. Each reference in any of the Loan Documents to the Note or Notes shall be deemed to be a reference to the Consolidated Note, and each reference to the "Obligations," the "Loan," the "Indebtedness," or words of like import shall be deemed to include the indebtedness under the Consolidated Note. The provisions for notices to the Borrower in each of the Loan Documents are amended, to provide for notices to Borrower at 32 East 31st Street, 9th Floor, New York, New York 10016, Attention: Mr. Samuel B. Petteway, Jr., President and Chief Executive Officer. 2. Amendment of Loan Agreement. The Loan Agreement is hereby amended as follows: a. The headings and text of Sections 3.10, 3.12, 3.14, 3.16, 3.18, 3.20, 3.21, and 5.1(i) are hereby deleted and of no further force and effect, and there is hereby substituted in their place, as to each of such Sections, the term "[Reserved]." b. Section 3.15 is hereby amended, by inserting at the end thereof the following: "Notwithstanding the foregoing, in the event that Borrower notifies Lender that Borrower desires to obtain debt financing (whether through the issuance of securities or otherwise), a condition of which is the granting of security interests or other liens on Borrower's assets which are senior in right of priority to the security interests and liens on the Borrower's assets held by Lender, Lender shall consent to such transaction provided that Borrower provides to Lender other security having a value and priority of perfection such that, in Lender's reasonable judgment, the security for repayment of the Loan will not be materially impaired." c. Section 7.4 is hereby amended, by inserting at the end of the last sentence thereof the phrase "other than in connection with a merger involving Borrower (whether or not Borrower is the surviving corporation of any such merger), the acquisition of all of the outstanding capital stock of Borrower by a third party, the sale of substantially all assets of Borrower, or similar reorganization involving Borrower." 3. Amendment of Security Agreement. The Security Agreement dated as of June 13, 2000 between Lender and NFC (the "Security Agreement") is hereby amended as follows: a. Section 4(e) of the Security Agreement is hereby amended, by adding at the end of the first sentence thereof the phrase "other than in connection with a merger involving Borrower (whether or not Borrower is the surviving corporation of any such merger), the acquisition of all of the outstanding capital stock of Borrower by a third party, the sale of substantially all assets of Borrower, or similar reorganization involving Borrower." 2 b. Section 4 of the Security Agreement is further amended, by adding at the end thereof the following new subsection (i): "(i) The Collateral as described in Section 1 above shall include all "supporting obligations" (as such term is defined in Revised Article 9 of the Uniform Commercial Code as in effect in any jurisdiction whose laws may be applicable ("Revised Article 9"), as well as the following categories of assets as defined in Revised Article 9: goods (including inventory, equipment and any accessions thereto), instruments (including promissory notes), documents, accounts, chattel paper (whether tangible or electronic, deposit accounts, letter-of-credit rights (whether or not evidenced in writing), commercial tort claims, securities and all other investment property, general intangibles (including payment intangibles and software, and any and all proceeds thereof, whether now owned or hereafter acquired. If required, Lender may at any time and from time to time file financing statements, continuation statements and amendments thereto that describe the Collateral, containing any information required by Part 5 of Revised Article 9 for the sufficiency or amendment, including the type of Borrower's organization and any organization identification number issued to Borrower. Borrower agrees to furnish any such information to Lender promptly on request. Any such financing statements, continuation statements or amendments may be signed by Lender on behalf of Borrower, and may be filed at any time in any jurisdiction whether or not Revised Article 9 is in effect in that jurisdiction. 4. Amendment of Intellectual Property Security Agreement. Section 4(c) of the Intellectual Property Security Agreement dated as of June 13, 2000 between Lender and NFC (the "Intellectual Property Security Agreement") is hereby amended, by adding at the end thereof the phrase "other than in connection with a merger involving Borrower (whether or not Borrower is the surviving corporation of any such merger), the acquisition of all of the outstanding capital stock of Borrower by a third party, the sale of substantially all assets of Borrower, or similar reorganization involving Borrower." 5. Cancellation of Original Notes. Simultaneously with the execution and delivery by Monsterdaata to the Lender of the Consolidated Note, the Lender shall deliver to Monsterdaata the Original Notes, as manually executed by NFC, marked "Cancelled", at which time such Original Notes shall be deemed of no further force and effect. 6. Waiver. Lender hereby waives all defaults and events of default that may have occurred prior to the date hereof, under any of the Loan Documents. In addition, Lender hereby waives compliance with Section 4(a) of the Security Agreement, for the limited purpose of permitting Monsterdaata to move any or all of the Collateral (as defined therein), and any records respecting any of the Collateral, to the State of New York, provided, however, that Monsterdaata provides Lender with prior written notice of any such proposed move, and executes and delivers to Lender for filing at Monsterdaata's 3 expense any amendments on Form UCC-3 (or other appropriate form) that may be necessary or appropriate in order to continue the perfection and priority of Lender's security interests in the Collateral. The foregoing waivers shall not be construed as a waiver of any default or event of default that may occur after the date hereof, as a consent to any action or failure to act in conformity with the Loan Documents, or any other matter. 7. Further Assurances. Monsterdaata agrees that, from time to time as requested by Lender, Monsterdaata will execute such other documents and perform such other actions as may be reasonably necessary or appropriate to evidence Monsterdaata's assumption of the obligations of NFC and otherwise to carry out the intent of this Agreement. 8. Entire Agreement. This Agreement, together with the Consolidated Note, represents the entire agreement between the parties concerning the subject matter hereof, and all oral discussions and prior agreements are merged herein. 9. Representation and Warranty of Monsterdaata. Monsterdaata represents and warrants to Lender that this Agreement has been duly authorized by all necessary corporate action on the part of Monsterdaata and is the legal, valid and binding obligation of Monsterdaata, enforceable in accordance with its terms, subject to limitations imposed by bankruptcy, insolvency, moratorium or other similar laws affecting the rights of creditors generally or the application of general equitable principles. 10. Waiver of NFC Representations and Warranties. Lender acknowledges that the representations and warranties of NFC contained in the Loan Agreement, the Security Agreement, and the Intellectual Property Security Agreement, including the schedules and exhibits thereto, were given as of June 13, 2000 and November 30, 2000, that Lender has not requested Monsterdaata to confirm or update any of such representations and warranties, and that Lender has not relied on the continuing accuracy of such representations and warranties in connection with the execution of this Agreement and closing of the transactions contemplated hereby. Accordingly, Lender hereby irrevocably waives any right or power it otherwise may have had (or may in the future have) to declare a default, to accelerate and demand immediate payment of principal under the Notes or the Consolidated Note, or to exercise any other remedies provided in such documents, based upon the inaccuracy of any representation or warranty contained in Article 2 of the Loan Agreement, Article 3 of the Security Agreement, or Article 3 of the Intellectual Property Security Agreement. 11. Effectiveness. This Agreement shall become effective upon, and simultaneously with, the closing of the Merger. 12. Governing Law. This Agreement shall be construed and enforced under the laws of the State of Tennessee applicable to contracts to be wholly performed in such State. 4 IN WITNESS WHEREOF, the parties have caused this Agreement to be executed in multiple counterparts, as of the day and year first above written. COMMERCE CAPITAL, L.P. By: Commerce Equity Capital Corporation, General Partner By: /s/ Rudy E. Ruark ------------------------------------- Rudy E. Ruark, Vice President MONSTERDAATA, INC. By: /s/ Samuel Petteway ------------------------------------- Title: CEO and President ------------------------------------- 5 EX-10 9 e763502.txt EXHIBIT 10.3 Exhibit 10.3 CONSOLIDATED AND RESTATED SECURED PROMISSORY NOTE $1,180,000.00 July 31, 2001 FOR VALUE RECEIVED, the undersigned, MONSTERDAATA, INC., a Delaware corporation ("Maker"), promises to pay to the order of COMMERCE CAPITAL, L.P., a Tennessee limited partnership ("Payee"; Payee and any subsequent holder[s] hereof are hereinafter referred to collectively as "Holder"), at the office of Payee at Commerce Capital, L.P., Renaissance Tower Suite 2602, 611 Commerce Street, Nashville, TN 37203, or at such other place as Holder may designate to Maker in writing from time to time, the principal sum of One Million One Hundred Eighty Thousand and NO/100THS Dollars ($1,180,000.00), together with interest on the outstanding principal balance hereof from the date hereof at the rate of eight percent (8.0%) per annum (computed on the basis of a 360-day year). Interest only on the outstanding principal balance hereof shall be due and payable monthly, in arrears, with the first installment being payable on the first (1st) day of August, 2001, and subsequent installments being payable on the first (1st) day of each succeeding month thereafter until June 1, 2005 (the "Maturity Date"), at which time the entire outstanding principal balance, together with all accrued and unpaid interest, shall be immediately due and payable in full. The indebtedness evidenced hereby may be prepaid in whole or in part, at any time and from time to time, without premium or penalty. Any such prepayments shall be credited first to any accrued and unpaid interest and then to the outstanding principal balance hereof. Time is of the essence of this Note. It is hereby expressly agreed that in the event that any Event of Default shall occur under and as defined in that certain Loan Agreement dated as of June 13, 2000, between NeighborhoodFind.com, LLC ("NFC") and Payee, as amended by Amendment No. 1 to Loan Agreement dated as of November 30, 2000 between the same parties, and by an Assumption and Amendment Agreement of even date herewith between the Maker, as successor by merger to NFC, and the Payee (the "Loan Agreement"), which Event of Default is not cured following the giving of any applicable notice and within any applicable cure period set forth in the Loan Agreement, then, and in such event, the entire outstanding principal balance of the indebtedness evidenced hereby, together with any other sums advanced hereunder, under the Loan Agreement and/or under any other instrument or document now or hereafter evidencing, securing or in any way relating to the indebtedness evidenced hereby, together with all unpaid interest accrued thereon, shall, at the option of Holder and without notice to Maker, at once become due and payable and may be collected forthwith, regardless of the stipulated date of maturity. Upon the occurrence and continuance as aforesaid of any Event of Default as set forth herein, at the option of Holder and without notice to Maker, all accrued and unpaid interest, if any, shall be added to the outstanding principal balance hereof, and the entire outstanding principal balance, as so adjusted, shall bear interest thereafter until paid at an annual rate (the "Default Rate") equal to the lesser of (i) the rate that is five percentage points (5.0%) in excess of the above-specified interest rate, or (ii) the maximum rate of interest allowed to be charged under applicable law (the "Maximum Rate"), regardless of whether or not there has been an acceleration of the payment of principal as set forth herein. All such interest shall be paid at the time of and as a condition precedent to the curing of any such Event of Default. This Note is a consolidation, amendment and restatement of a Secured Promissory Note dated June 13, 2000 in the principal amount of $800,000 and a Secured Promissory Note dated November 30, 2000 in the principal amount of $380,000, and shall supersede and replace such notes in their entirety. This Note is entitled to all of the benefits provided to the Holder by the Loan Agreement and the other Loan Documents, as defined in the Loan Agreement. In the event this Note is placed in the hands of an attorney for collection, or if Holder incurs any costs incident to the collection of the indebtedness evidenced hereby, Maker and any endorsers hereof agree to pay to Holder an amount equal to all such costs, including without limitation all reasonable attorneys' fees and all court costs. Presentment for payment, demand, protest and notice of demand, protest and nonpayment are hereby waived by Maker and all other parties hereto. No failure to accelerate the indebtedness evidenced hereby by reason of an Event of Default hereunder, acceptance of a past-due installment or other indulgences granted from time to time, shall be construed as a novation of this Note or as a waiver of such right of acceleration or of the right of Holder thereafter to insist upon strict compliance with the terms of this Note or to prevent the exercise of such right of acceleration or any other right granted hereunder or by applicable law. No extension of the time for payment of the indebtedness evidenced hereby or any installment due hereunder, made by agreement with any person now or hereafter liable for payment of the indebtedness evidenced hereby, shall operate to release, discharge, modify, change or affect the original liability of Maker hereunder or that of any other person now or hereafter liable for payment of the indebtedness evidenced hereby, either in whole or in part, unless Holder agrees otherwise in writing. This Note may not be changed orally, but only by an agreement in writing signed by the party against whom enforcement of any waiver, change, modification or discharge is sought. The indebtedness and other obligations evidenced by this Note are further evidenced by (i) the Loan Agreement and (ii) certain other instruments and documents, as may be required to protect and preserve the rights of Maker and Payee, as more specifically described in the Loan Agreement. All agreements herein made are expressly limited so that in no event whatsoever, whether by reason of advancement of proceeds hereof, acceleration of maturity of the unpaid balance hereof or otherwise, shall the amount paid or agreed to be paid to Holder for the use of the money advanced or to be advanced hereunder exceed the Maximum Rate. If, from any circumstances whatsoever, the fulfillment of any provision of this Note or any other agreement or instrument now or hereafter evidencing, securing or in any way relating to the indebtedness evidenced hereby shall involve the payment of interest in excess of the Maximum Rate, then, ipso facto, the obligation to pay interest hereunder shall be reduced to the Maximum Rate; and if from any circumstance whatsoever, Holder shall ever receive interest, the amount of which 2 would exceed the amount collectible at the Maximum Rate, such amount as would be excessive interest shall be applied to the reduction of the principal balance remaining unpaid hereunder and not to the payment of interest. This provision shall control every other provision in any and all other agreements and instruments existing or hereafter arising between Maker and Holder with respect to the indebtedness evidenced hereby. This Note is intended as a contract under and shall be construed and enforceable in accordance with the laws of the State of Tennessee, except that federal law shall govern the determination of the Maximum Rate. Maker hereby irrevocably consents to the jurisdiction of the United States District Court for the Middle District of Tennessee and of all Tennessee state courts sitting in Davidson County, Tennessee, for the purpose of any litigation to which Lender may be a party and which concerns this Note or the indebtedness evidenced hereby. It is further agreed that venue for any such action shall lie exclusively with courts sitting in Davidson County, Tennessee, unless Holder agrees to the contrary in writing. HOLDER AND MAKER HEREBY KNOWINGLY AND VOLUNTARILY WITH THE BENEFIT OF COUNSEL WAIVE TRIAL BY JURY IN ANY ACTIONS, PROCEEDINGS, CLAIMS OR COUNTER-CLAIMS, WHETHER IN CONTRACT OR TORT OR OTHERWISE, AT LAW OR IN EQUITY, ARISING OUT OF OR IN ANY WAY RELATING TO THIS AGREEMENT OR THE LOAN DOCUMENTS. As used herein, the terms "Maker" and "Holder" shall be deemed to include their respective successors, legal representatives and assigns, whether by voluntary action of the parties or by operation of law. MAKER: MONSTERDAATA, INC. a Delaware corporation By:/s/ Samuel B. Petteway, Jr. -------------------------------------------- Name: Samuel B. Petteway, Jr. Title: President and Chief Executive Officer 3 EX-10 10 e765435.txt EXHIBIT 10.4 Exhibit 10.4 LOAN AGREEMENT THIS LOAN AGREEMENT ("Agreement"), dated as of the 13th day of June, 2000, is made and entered into on the terms and conditions hereinafter set forth, by and between NeighborhoodFind.com, LLC, a Delaware limited liability company ("Borrower"), and COMMERCE CAPITAL, L.P., a Tennessee limited partnership ("Lender"). RECITALS: WHEREAS, Borrower has requested that Lender make available to Borrower a term loan in the original principal amount of Eight Hundred Thousand Dollars ($800,000.00) (the "Loan") on the terms and conditions hereinafter set forth, and for the purpose(s) hereinafter set forth; and WHEREAS, in order to induce Lender to make the Loan to Borrower, Borrower has made certain representations to Lender; and WHEREAS, Lender, in reliance upon the representations and inducements of Borrower, has agreed to make the Loan upon the terms and conditions hereinafter set forth. AGREEMENT: NOW, THEREFORE. in consideration of the agreement of Lender to make the Loan, the mutual covenants and agreements hereinafter set forth, and other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, Borrower and Lender hereby agree as follows: ARTICLE 1 THE LOAN 1.1 Evidence of Loan Indebtedness and Repayment. Subject to the terms and conditions contained herein, the Lender shall make the Loan to Borrower by wire transfer in immediately available funds. The Loan shall be evidenced by a Secured Promissory Note in the original principal amount of Eight Hundred Thousand Dollars ($800,000), dated as of the date hereof, executed by Borrower in favor of Lender (the "Note"). The Loan shall be payable in accordance with the terms of the Note. The Note, this Agreement and any other instruments and documents executed by Borrower, any guarantor of Borrower, or any shareholder, member, partner, subsidiary or affiliate of Borrower or of any guarantor of Borrower (individually, "Affiliate," and collectively, "Affiliates"), now or hereafter evidencing, securing or in any way related to the indebtedness evidenced by the Note are herein individually referred to as a "Loan Document" and collectively referred to as the "Loan Documents." The term "Obligations" as used herein shall refer to (a) the Loan to be made concurrently or in connection with this Agreement, as evidenced by the Note, and any renewals or extensions thereof, (b) the full and prompt payment and performance of any and all other indebtednesses and other obligations of Borrower to Lender, direct or contingent (including but not limited to obligations incurred as indorser, guarantor or surety), however evidenced or denominated, and however and whenever incurred, including but not limited to indebtednesses incurred pursuant to any present or future commitment of Lender to Borrower and (c) all future advances made by Lender for taxes, levies, insurance and preservation of the Collateral and all attorneys' fees, court costs and expenses of whatever kind incident to the collection of any of said indebtedness or other obligations and the enforcement and protection of the security interest created hereby or by the other Loan Documents. 1.2 Processing Fee. Borrower shall pay Lender a processing fee of $16,000.00, which shall be paid on the date the Loan is funded. 1.3 Prepayment. Borrower may prepay the indebtedness evidenced by the Note in whole or in part at any time and from time to time, without penalty or premium. 1.4 Purposes of Loan and Use of Proceeds. The purpose of the Loan shall be to provide additional acquisition and working capital to Borrower. ARTICLE 2 REPRESENTATIONS AND WARRANTIES 2.1 Borrower's Representations. Except to the extent set forth on the Borrower's Schedule of Exceptions attached hereto, Borrower hereby represents and warrants to Lender as follows: (a) Corporate Status. Borrower is a limited liability company duly organized, validly existing and in good standing under the laws of the State of Delaware; and has the power to own and operate its properties, to carry on its business as now conducted and to enter into and to perform its obligations under this Agreement and the other Loan Documents to which it is a party. Borrower is duly qualified to do business and is in good standing in each state in which a failure to be so qualified would have a material adverse effect on Borrower's financial condition or its ability to conduct its business in the manner now conducted. (b) Subsidiaries. Borrower neither owns nor has an interest in, directly or indirectly, any other corporation, partnership, joint venture or other business organization ("Subsidiaries"). (c) Authorization. Borrower has full legal right, power and authority to conduct its business and affairs. Borrower has full legal right, power and authority to enter into and perform its obligations under the Loan Documents, without the consent or approval of any other person, firm, governmental agency or other legal entity. The execution and delivery of this Agreement, the borrowing hereunder, the execution and delivery of each Loan Document to which Borrower is a party, and the performance by Borrower of its obligations thereunder are within the powers of Borrower and have been duly authorized by all necessary action properly taken and Borrower has received all necessary governmental approvals, if any, that are required. The officer(s) 2 executing this Agreement, the Note and all of the other Loan Documents to which Borrower is a party are duly authorized to act on behalf of Borrower. (d) Validity and Binding Effect. This Agreement and the other Loan Documents are the legal, valid and binding obligations of the Borrower, enforceable in accordance with their respective terms, subject to limitations imposed by bankruptcy, insolvency, moratorium or other similar laws affecting the rights of creditors generally or the application of general equitable principles. (e) Capitalization. As of the date hereof, all outstanding membership interests of Borrower (the "Interests") are set forth on Schedule 2.1(e) attached hereto. All membership interests of Borrower which are reserved for issuance upon exercise of the Membership Interest Purchase Warrant dated as of the date hereof and issued to Lender (the "Warrant") are set forth on Schedule 2.1(e) attached hereto; provided, however, that the units of membership interests reserved for issuance upon exercise of the Warrant may be increased from time to time in accordance with the term of the Warrant. As of the date hereof, Borrower does not have outstanding any securities convertible or exchangeable for any of its membership interests or containing any profit participation features, and does not have outstanding any rights or options to subscribe for or to purchase its membership interests, except as set forth on Schedule 2.1(e) and the Warrant. As of the date hereof, Borrower is not subject to any obligation (contingent or otherwise) to repurchase, redeem, retire or otherwise acquire any of its membership interests or any warrants, options or other rights to acquire its membership interests, except as set forth in the Warrant or on Schedule 2.1(e). As of the date hereof, all of the outstanding membership interests of Borrower are validly issued, fully paid and nonassessable. Except as set forth on Schedule 2.1(e), there are no statutory or contractual preemptive rights, rights of first refusal, anti-dilution rights or any similar rights, held by members or option holders of Borrower, with respect to the issuance of the Warrant or the issuance of the membership interests upon exercise of the Warrant, and all such rights have been effectively waived with regard to the issuance of the Warrant, the exercise of the Warrant and the issuance of the membership interests upon exercise of the Warrant. Borrower has not violated any applicable federal or state securities laws in connection with the offer, sale or issuance of any of its membership interests, and the offer, sale and issuance of the Warrant hereunder do not require registration under the Securities Act of 1933, as amended, or any applicable state securities laws. To the best of Borrower's knowledge, there are no agreements among Borrower's members with respect to any other aspect of Borrower's affairs, except as set forth on Schedule 2.1(e). 3 (f) Trademarks, Patents, Etc. Schedule 2.1(f) is an accurate and complete list of all patents, trademarks, tradenames, trademark registrations, service names, service marks, copyrights, licenses, formulas and applications therefor owned by Borrower or used or required by Borrower in the operation of its business, title to each of which is, except as set forth in Schedule 2.1(f) hereto, held by Borrower free and clear of all adverse claims, liens, security agreements, restrictions or other encumbrances. Except as set forth in Schedule 2.1(f), Borrower owns or possesses adequate (and will use its best efforts to obtain as expediently as possible any additional) licenses or other rights to use all patents, trademarks, trade names, service marks, trade secrets or other intangible property rights and know-how necessary to entitle Borrower to conduct its business as presently being conducted. There is no infringement action, lawsuit, claim or complaint which asserts that Borrower's operations violate or infringe the rights or the trade names, trademarks, trademark registrations, service names, service marks or copyrights of others with respect to any apparatus or method of Borrower or any adversely held trademarks, trade names, trademark registrations, service names, service marks or copyrights, and Borrower is not in any way making use of any confidential information or trade secrets of any person, except with the consent of such person. Except as set forth in Schedule 2.1(f), Borrower has taken reasonable steps to protect its proprietary information (except disclosure of source codes pursuant to licensing agreements) and is the lawful owner of the proprietary information free and clear of any claim of any third party. As used herein, "proprietary information" includes without limitation, (i) any computer programming language, software, hardware, firmware or related documentation, inventions, technical and nontechnical data related thereto, and (ii) other documentation, inventions and data related to patterns, plans, methods, techniques, drawings, finances, customer lists, suppliers, products, special pricing and cost information, designs, processes, procedures, formulas, research data owned or used by Borrower or marketing studies conducted by Borrower, all of which Borrower considers to be commercially important and competitively sensitive and which generally has not been disclosed to third parties. (g) No Conflicts. Consummation of the transactions contemplated hereby and the performance of the obligations of Borrower under and by virtue of the Loan Documents do not conflict with, and will not result in any breach of, or constitute a default or trigger a lien under, any mortgage, security deed or agreement, deed of trust, lease, bank loan or credit agreement, corporate charter or bylaws, agreement or certificate of limited partnership, partnership agreement, license, franchise or any other instrument or agreement to which Borrower is a party or by which Borrower or its respective properties may be bound or affected or to which Borrower has not obtained an effective waiver. (h) Litigation. There are no actions, suits, arbitrations, administrative hearings or other proceedings pending, or, to the knowledge of Borrower, threatened, against or affecting Borrower or NeighborhoodFind.com, Inc., a Virginia corporation ("NFI") or any of their respective property or involving the validity or enforceability of 4 any of the Loan Documents at law or in equity, or before any governmental or administrative agency. To Borrower's knowledge, neither Borrower nor NFI is subject to any order, writ, injunction, decree or demand of any court or any governmental authority. (i) Financial Statements. The financial statements of NFI dated ________________ 2000, which are attached hereto as Schedule 2.1(i)(A), are true and correct in all material respects, have been prepared on the basis of generally accepted accounting principles consistently applied, and fairly present the financial condition of NFI as of the date(s) thereof. No material adverse change has occurred in the financial condition of Borrower or NFI, considered on a consolidated basis, since the date(s) thereof, and no additional borrowings have been made by Borrower or NFI since the date(s) thereof other than as set forth on Schedule 2.1(i)(B). (j) Conveyance of NFI Assets. As of the Closing Date, NFI shall have conveyed to Borrower substantially all of the assets owned by NFI, including without limitation equipment, inventory, computer software, know-how, trademarks and trade names, and other intangible assets, and has assigned to Borrower all leases, licenses, contracts and other rights to possess or use assets owned by third parties. Borrower owns or has a valid right to use and/or possess all tangible and intangible assets necessary for it to conduct the business previously conducted by NFI. (k) Other Agreements; No Defaults. Neither Borrower nor NFI is a party to any indenture, loan or credit agreement, lease or other agreement or instrument, or subject to any charter or corporate restriction, or any restriction in its articles of incorporation, bylaws, certificate of formation or operating agreement that could have a material adverse effect on the business, properties, assets, operations or conditions, financial or otherwise of Borrower or NFI, or the ability of Borrower or NFI to carry out their obligations under the Loan Documents to which they are a party. Neither Borrower nor NFI is in default in any respect in the performance, observance or fulfillment of any of the obligations, covenants or conditions contained in any agreement or instrument material to their businesses to which it is a party, including but not limited to this Agreement and the other Loan Documents, and no other default or event has occurred and is continuing that with notice or the passage of time or both would constitute a default or event of default under any of same. (l) Compliance With Law. Borrower has obtained all necessary licenses, permits and approvals and authorizations necessary or required in order to conduct its business and affairs as heretofore conducted and as hereafter intended to be conducted. Borrower is in compliance with all laws, regulations, decrees and orders applicable to it (including but not limited to laws, regulations, decrees and orders relating to environmental, occupational and health standards and controls, antitrust, monopoly, restraint of trade or unfair competition), except to the extent that any noncompliance, in the aggregate, cannot reasonably be expected to have a material adverse effect on its business, operations, property or financial condition and will not materially adversely affect Borrower's ability to perform its obligations under the Loan Documents. 5 (m) Debt. Schedule 2.1(m) is a complete and correct list of all credit agreements, indentures, purchase agreements, promissory notes and other evidences of indebtedness, guaranties, capital leases and other instruments, agreements and arrangements presently in effect providing for or relating to extensions of credit (including agreements and arrangements for the issuance of letters of credit or for acceptance financing) in respect of which the Borrower, NFI or any of their properties is in any manner directly or contingently obligated and the maximum principal or face amounts of the credit in question that are outstanding and that can be outstanding are correctly stated, and all liens of any nature given or agreed to be given as security therefor are correctly described or indicated in Schedule 2.1(l). (n) Taxes. NFI has filed or caused to be filed all tax returns that are required to be filed (except for returns that have been appropriately extended), and has paid, or will pay when due, all taxes shown to be due and payable on said returns and all other taxes, impositions, assessments, fees or other charges imposed on it by any governmental authority, agency or instrumentality, prior to any delinquency with respect thereto (other than taxes, impositions, assessments, fees and charges currently being contested in good faith by appropriate proceedings, for which appropriate amounts have been reserved). No tax liens have been filed against NFI or any of its property. Borrower is newly organized and has not yet been required to file any tax return. (o) Certain Transactions. Except as set forth on Schedule 2.1(o) hereto, neither Borrower nor NFI is indebted, directly or indirectly, to any of its members, managers, shareholders, officers or directors or to their respective spouses or children, in any amount whatsoever, and none of said members, managers, shareholders, officers or directors or any members of their immediate families, are indebted to Borrower or NFI or have any direct or indirect ownership interest in any firm or corporation with which Borrower or NFI has a business relationship, or any firm or corporation which competes with Borrower or NFI, except that members, managers, shareholders, officers and/or directors of Borrower or NFI may own no more than 4.9% of outstanding stock of publicly traded companies which may compete with Borrower or NFI. No member, manager, shareholders, officer or director of Borrower or NFI or any member of their immediate families, is, directly or indirectly, interested in any material contract with Borrower or NFI. Neither Borrower nor NFI is a guarantor or indemnitor of any indebtedness of any other person, firm, corporation or other legal entity. (p) Statements Not False or Misleading. No representation or warranty given as of the date hereof by Borrower contained in this Agreement or any schedule attached hereto or any statement in any document, certificate or other instrument furnished or to be furnished by Borrower to Lender pursuant hereto, taken as a whole, contains or will (as of the time so furnished) contain any untrue statement of a material fact, or omits or will (as of the time so furnished) omit to state any material fact which is necessary in order to make the statements contained therein not misleading. 6 (q) Margin Regulations. Borrower is not engaged in the business of extending credit for the purpose of purchasing or carrying margin stock. No proceeds received pursuant to this Agreement will be used to purchase or carry any equity security of a class which is registered pursuant to Section 12 of the Securities Exchange Act of 1934, as amended. (r) Significant Contracts. Schedule 2.1(r) is a complete and correct list of all contracts, agreements and other documents pursuant to which Borrower or NFI receives revenues in excess of $25,000 per fiscal year or has committed to make expenditures in excess of $25,000 per fiscal year. Each such contract, agreement and other document is in full force and effect as of the date hereof and Borrower knows of no reason why such contracts, agreements and other documents would not remain in full force and effect pursuant to the terms thereof. (s) Environment. Borrower and NFI have duly complied with, and their businesses, operations, assets, equipment, property, leaseholds or other facilities are in compliance with, the provisions of all federal, state and local environmental, health, and safety laws, codes and ordinances, and all rules and regulations promulgated thereunder. Borrower and NFI have been issued and will maintain all required federal, state and local permits, licenses, certificates and approvals relating to (i) air emissions; (ii) discharges to surface water or groundwater; (iii) noise emissions; (iv) solid or liquid waste disposal; (v) the use, generation, storage, transportation or disposal of toxic or hazardous substances or wastes (which shall include any and all such materials listed in any federal, state or local law, code or ordinance and all rules and regulations promulgated thereunder as hazardous or potentially hazardous); or (vi) other environmental, health or safety matters. Neither Borrower nor NFI have received notice of, or knows of, or suspects facts which might constitute any violations of any federal, state or local environmental, health or safety laws, codes or ordinances, and any rules or regulations promulgated thereunder with respect to their businesses, operations, assets, equipment, property, leaseholds, or other facilities. To the best knowledge of Borrower and NFI, except in accordance with a valid governmental permit, license, certificate or approval, there has been no emission, spill, release or discharge into or upon (i) the air; (ii) soils, or any improvements located thereon; (iii) surface water or groundwater; or (iv) the sewer, septic system or waste treatment, storage or disposal system servicing the premises, of any toxic or hazardous substances or wastes at or from the premises; and, to the best knowledge of Borrower and NFI, accordingly the premises of Borrower and NFI are free of all such toxic or hazardous substances or wastes. To the best knowledge of Borrower and NFI, there has been no complaint, order, directive, claim, citation or notice by any governmental authority or any person or entity with respect to (i) air emissions; (ii) spills, releases or discharges to soils or improvements located thereon, surface water, groundwater or the sewer, septic system or waste treatment, storage or disposal systems servicing the premises; (iii) noise emissions; (iv) solid or liquid waste disposal; (v) the use, generation, storage, transportation or disposal of toxic or hazardous substances or waste; or (vi) other environmental, health or safety matters affecting Borrower, NFI or their 7 businesses, operations, assets, equipment, property, leaseholds or other facilities. To the best knowledge of Borrower and NFI, neither Borrower nor NFI has any indebtedness, obligation or liability (absolute or contingent, matured or not matured), with respect to the storage, treatment, cleanup or disposal of any solid wastes, hazardous wastes or other toxic or hazardous substances (including without limitation any such indebtedness, obligation, or liability with respect to any current regulation, law or statute regarding such storage, treatment, cleanup or disposal). (t) Fees/Commissions. Neither Borrower nor NFI have agreed to pay any finder's fee, commission, origination fee (except for the processing and commitment fees due pursuant to Section 1.2 hereof and except as set forth on Schedule 2.1(t) hereto) or other fee or charge to any person or entity with respect to the Loan and investment transactions contemplated hereunder. (u) ERISA. Borrower and NFI are in compliance in all material respects with all applicable provisions of Title IV of the Employee Retirement Income Security Act of 1974, Pub. L. No. 93-406, September 2, 1974, 88 Stat. 829, 29 U.S.C.A.ss. 1001 et seq. (1975), as amended form time to time ("ERISA"). Neither a reportable event nor a prohibited transaction (as defined in ERISA) has occurred and is continuing with respect to any pension plan that is subject to the requirements of ERISA (a "Plan"); no notice of intent to terminate a Plan has been filed nor has any Plan been terminated; no circumstances exist which constitute grounds entitling the Pension Benefit Guaranty Corporation (together with any entity succeeding to any or all of its functions, the "PBGC") to institute proceedings to terminate, or appoint a trustee to administer, a Plan, nor has the PBGC instituted any such proceedings; neither Borrower nor any commonly controlled entity (as defined in ERISA) has completely or partially withdrawn from a multiemployer plan (as defined in ERISA); Borrower and each commonly controlled entity has met its minimum funding requirements under ERISA with respect to all of its Plans and the present fair market value of all Plan property exceeds the present value of all vested benefits under each Plan, as determined on the most recent valuation date of the Plan and in accordance with the provisions of ERISA and the regulations thereunder for calculating the potential liability of Borrower or any commonly controlled entity to the PBGC or the Plan under Title IV or ERISA; and neither Borrower nor any commonly controlled entity has incurred any liability to the PBGC under ERISA. (v) Title to Properties. Borrower and NFI have good, indefeasible and insurable title to, or valid leasehold interests in, all their real properties and other assets, free and clear of all liens other than Permitted Liens (as defined in Section 3.15 hereof). 8 (w) Limited Offering of Note and Warrant. Neither Borrower nor anyone acting on its behalf has offered the Note, the Warrant or any similar securities for sale to, or solicited any offer to buy any of the same from, or otherwise approached or negotiated in respect thereof, with, any person other than Lender and not more than 35 other institutional investors. Neither Borrower nor anyone acting on its behalf has taken, or will take, any action which would subject the issuance or sale of the Note and Warrant to Section 5 of the Securities Act of 1933, as amended, or the registration or qualification provisions of the blue sky laws of any state in which the issuance or sale of the Note and Warrant otherwise would be required to be registered or qualified. (x) Registration Rights. Except as described in the Warrant, Borrower is not under any obligation to register under the Securities Act of 1933, as amended, or the Trust Indenture Act of 1939, as amended, any of its presently outstanding securities or any of its securities that may subsequently be issued. (y) Employees. Neither Borrower nor NFI has any current labor problems or disputes which have resulted or Borrower reasonably believes could be expected to have a material adverse effect on the operations, properties or financial condition of Borrower or NFI or on their ability to perform their obligations hereunder. (z) Issuance Taxes. All taxes imposed on Borrower in connection with the issuance, sale and delivery of the Note, the Warrant and the membership interest units issuable upon exercise of the Warrant have been or will be fully paid, and all laws imposing such taxes have been or will be fully satisfied by Borrower. (aa) Solvency. As of the date hereof and giving effect to the making of the Loan, Borrower (i) has capital reasonably sufficient to carry on its business and transactions and all business and transactions in which it is about to engage and is able to pay its debts as they mature, (ii) owns property having a value, both at fair valuation and at present fair saleable value, greater than the amount required to pay its probable liabilities (including contingencies), and (iii) does not believe that it will incur debts or liabilities beyond its ability to pay such debts or liabilities as they mature. (bb) Location of Properties, Places of Business. The only jurisdictions in which Borrower maintains any tangible personal property or carries on business are as listed in Schedule 2.1(aa) hereto. All billings for the supply of goods and services by Borrower are made from, and require payment to be made to, the chief executive office of the Borrower. (cc) Year 2000 Compatibility. Borrower has reviewed its financial accounting systems and other computer systems for year 2000 compatibility and has not identified any issues that could have a material adverse effect on Borrower's business, operations, property or financial condition. ARTICLE 3 COVENANTS AND AGREEMENTS 9 Borrower covenants and agrees that during the term of this Agreement: 3.1 Payment of Obligations. Borrower shall pay the indebtedness evidenced by the Note according to the terms thereof, and shall timely pay or perform, as the case may be, all of the other obligations of Borrower to Lender, direct or contingent, however evidenced or denominated, and however and whenever incurred, including but not limited to indebtedness incurred pursuant to any present or future commitment of Lender to Borrower, together with interest thereon, and any extensions, modifications, consolidations and/or renewals thereof and any notes given in payment thereof. 3.2 Financial Statements and Reports. Borrower shall furnish to Lender (a) as soon as practicable and in any event within ninety (90) days after the end of each fiscal year of Borrower, an audited balance sheet of Borrower as of the close of such fiscal year, an audited statement of operations of Borrower as of the close of such fiscal year and an audited statement of cash flows for Borrower for such fiscal year, prepared in accordance with generally accepted accounting principles consistently applied and accompanied by an unqualified audit report prepared by an independent certified public accountant acceptable to Lender showing the financial condition of Borrower at the close of such fiscal year and the results of its operations during such fiscal year and accompanied by a certificate of the President of Borrower, stating that to the best of the knowledge of such officer, Borrower has kept, observed, performed and fulfilled each covenant, term and condition of this Agreement and the other Loan Documents during the preceding fiscal year and that no Event of Default has occurred and is continuing (or if an Event of Default has occurred and is continuing, specifying the nature of same, the period of existence of same and the action Borrower proposes to take in connection therewith), (b) within thirty (30) days of the end of each calendar month, a status report indicating the financial performance of Borrower during such month and the financial position of Borrower as of the end of such month in the format required by Lender (which format will be delivered to Borrower on a diskette), (c) within sixty (60) days of the end of each quarter, a balance sheet of Borrower as of the close of such quarter and a statement of operations of Borrower as of the close of such quarter, all in reasonable detail, and prepared substantially in accordance with generally accepted accounting principles consistently applied (except for the absence of footnotes and subject to year-end adjustments), and (d) with reasonable promptness, such other financial data, including without limitation, accounts receivable agings, as Lender may reasonably request. Without Lender's prior written consent, Borrower shall not modify or change any accounting policies or procedures, including Borrower's fiscal year, in effect on the date hereof. 3.3 Maintenance of Books and Records; Inspection. Borrower shall maintain its books, accounts and records in accordance with generally accepted accounting principles consistently applied, and after reasonable notice from Lender permit Lender, its officers and employees and any professionals designated by Lender in writing, at Borrower's expense, to visit and inspect any of its properties, corporate books and financial records, and to discuss its accounts, affairs and finances with Borrower or the principal officers of Borrower during reasonable business hours, all at such times as Lender may reasonably request; provided that no such inspection shall materially interfere with the conduct of Borrower's business. Notwithstanding anything in this paragraph to the contrary, except upon the occurrence of an 10 Event of Default, Borrower shall not be required to pay the expenses associated with any such inspection more than once in any calendar year. 3.4 Insurance. Without limiting any of the requirements of any of the other Loan Documents, Borrower shall maintain, in amounts customary for entities engaged in comparable business activities, (a) to the extent required by applicable law, worker's compensation insurance (or maintain a legally sufficient amount of self insurance against worker's compensation liabilities, with adequate reserves, under a plan approved by Lender, such approval not to be unreasonably withheld or delayed), and (b) fire and "all risk" casualty insurance on its properties against such hazards and in at least such amounts as are customary in Borrower's business. Borrower will make reasonable efforts to obtain and maintain public liability insurance in an amount, and at a cost, deemed reasonable to the Borrower's Board of Managers. At the request of Lender, Borrower will deliver forthwith a certificate specifying the details of such insurance in effect. 3.5 Taxes and Assessments. Borrower shall (a) file all tax returns and appropriate schedules thereto that are required to be filed under applicable law, prior to the date of delinquency, (b) pay and discharge all taxes, assessments and governmental charges or levies imposed upon Borrower upon its income and profits or upon any properties belonging to it, prior to the date on which penalties attach thereto, and (c) pay all taxes, assessments and governmental charges or levies that, if unpaid, might become a lien or charge upon any of its properties; provided, however, that Borrower in good faith may contest any such tax, assessment, governmental charge or levy described in the foregoing clauses (b) and (c) so long as appropriate reserves in accordance with generally accepted accounting principles are maintained with respect thereto. 3.6 Existence. Borrower shall maintain its existence and good standing in the state of its organization, and its qualification to do business and good standing as a foreign entity in each jurisdiction in which such qualification is necessary pursuant to applicable law. 3.7 Compliance with Law and Other Agreements. Except where the failure to do so would not materially adversely affect Borrower's operations, properties, financial condition or its ability to fulfill its obligations under the Loan Documents, Borrower shall maintain its business operations and property owned or used in connection therewith in compliance with (a) all applicable federal, state and local laws, regulations and ordinances governing such business operations and the use and ownership of such property, and (b) all agreements, licenses, franchises, indentures and mortgages to which Borrower is a party or by which Borrower or any of its properties is bound. Without limiting the foregoing, Borrower shall pay all of its indebtedness promptly in accordance with the terms thereof. 3.8 Notice of Default; Perceived Breach. Borrower shall give written notice to Lender of the occurrence of any default, event of default or Event of Default under this Agreement or any other Loan Document promptly upon the occurrence thereof. Borrower agrees to give Lender prompt written notice of any action or inaction by or on behalf of Lender in connection with this Agreement or the Obligations that Borrower believes may be actionable against Lender or a defense to payment of any or all Obligations for any reason, 11 including, but not limited to, commission of a tort or violation of any contractual duty or duty implied by law. 3.9 Notice of Litigation. Borrower shall give notice, in writing, to Lender of (a) any actions, suits or proceedings, instituted by any persons whomsoever against Borrower or affecting any of the assets of Borrower wherein the amount at issue is in excess of Twenty-Five Thousand and No/100ths Dollars ($25,000.00) and (b) any dispute, not resolved within sixty (60) days of the commencement thereof, between Borrower on the one hand and any governmental regulatory body on the other hand, which dispute might materially interfere with the normal operations of Borrower. 3.10 Conduct of Business. Borrower will continue to engage in a business of the same general type and manner as conducted by it or NFI prior to the date of this Agreement. 3.11 ERISA Plan. If Borrower has in effect, or hereafter institutes, a Plan that is subject to the requirements of ERISA, then the following warranty and covenants shall be applicable during such period as any such Plan shall be in effect: (a) Borrower hereby warrants that no fact that might constitute grounds for the involuntary termination of the Plan, or for the appointment by the appropriate United States District Court of a trustee to administer the Plan, exists at the time of execution of this Agreement; (b) Borrower hereby covenants that throughout the existence of the Plan, Borrower's contributions tinder the Plan will meet the minimum funding standards required by ERISA and Borrower will not institute a distress termination of the Plan; and (c) Borrower covenants that it will send to Lender a copy of any notice of a reportable event (as defined in ERISA) required by ERISA to be filed with the Labor Department or the Pension Benefit Guaranty Corporation, at the time that such notice is so filed. 3.12 Dividends, Distributions, etc. Except for dividends and distributions required by Borrower's operating agreement, Borrower shall not, without the prior written consent of Lender, which consent shall not be unreasonably withheld, declare or pay any dividend of any kind, in cash or in property, on any class of the membership interests of Borrower, or purchase, redeem, retire or otherwise acquire for value any such membership interests, nor make any distribution of any kind in cash or property in respect thereof, nor make any return of capital of members, nor make any payments in cash or property in respect of any options, bonus or similar plan nor grant any preemptive rights with respect to the membership interests of Borrower. 3.13 Guaranties; Loans; Payment of Debt. Without the prior written consent of Lender, Borrower shall not guarantee nor be liable in any manner, whether directly or indirectly, or become contingently liable after the date of this Agreement in connection with the obligations or indebtedness of any person or entity whatsoever, except for the endorsement of negotiable instruments payable to Borrower for deposit or collection in the ordinary course of business. Without the prior written consent of Lender, Borrower shall not (a) make any loan, advance or extension of credit to any person other than in the normal course of its business, or (b) make any payment on any subordinated debt other than (i) trade payables 12 incurred in the ordinary course of Borrower's business and (ii) a note in favor of One Valley Bank in the amount of $6,519.68 which may be paid in its entirety. 3.14 Debt. Without the prior written consent of Lender, Borrower shall not create, incur, assume or suffer to exist indebtedness of any description whatsoever, excluding: (a) the indebtedness evidenced by the Note; (b) the endorsement of negotiable instruments payable to Borrower for deposit or collection in the ordinary course of business; (c) trade payables incurred in the ordinary course of business (each of which, individually, does not exceed $25,000) or other debts or expenditures permitted in any budget and use of funds duly approved by the Board of Managers of the Borrower, (d) the indebtedness listed on Schedule 2.1(m) hereto; and (e) equipment, furniture, fixtures needed in the normal course of business including, but not limited to, 200 laptop computers and printers, one passenger/cargo van, 40 desktop computers and three copiers. 3.15 No Liens. Without the prior written consent of Lender, Borrower shall not create, incur, assume or suffer to exist any lien, security interest, security title, mortgage, deed of trust or other encumbrance upon or with respect to any of its assets, now owned or hereafter acquired, except the following permitted liens (the "Permitted Liens"): (a) liens in favor of Lender; (b) liens for taxes or assessments or other governmental charges or levies if not yet due and payable; (c) liens on leased equipment granted in connection with the leasing of such equipment in favor of the lessor of such equipment; (d) liens described on Schedule 2.1(m) hereto; (e) statutory, mechanics', laborers' and materialmen liens arising in the ordinary course of business for sums not yet due; (f) statutory and contractual landlord liens under leases pursuant to which the Borrower is a lessee and not in default; (g) with regard to real property, any and all recorded restrictions (not including mortgages or security interests), reservations, covenants, conditions, oil and gas leases, mineral severances, rights-of-way, building or use restrictions, prescriptive rights, encroachments, protrusions, and party walls, and liens for taxes, assessments, and other governmental charges not yet due. 3.16 Mergers, Consolidations, Acquisitions and Sales. Without the prior written consent of Lender, Borrower shall not (a) be a party to any merger, consolidation or corporate reorganization, nor (b) purchase or otherwise acquire all or substantially all of the assets or stock of, or any partnership, membership or joint venture interest in, any other person, firm or entity, nor (c) sell, transfer, convey, or lease all or any substantial part of its assets, nor (d) create any Subsidiaries nor convey any of its assets to any Subsidiary. 13 3.17 Transactions With Affiliates. Borrower shall not enter into any transaction, including, without limitation, the purchase, sale or exchange of property or the rendering of any service, with any affiliate, except in the ordinary course of and pursuant to the reasonable requirements of Borrower's business and upon fair and reasonable terms no less favorable to Borrower than Borrower would obtain in a comparable arm's length transaction with a person not an affiliate. For the purposes of this Section 3.17, "affiliate" shall mean a person, corporation, partnership or other entity controlling, controlled by or under common control with Borrower. 3.18 Employment Contracts. Without the prior written consent of Lender, Borrower shall not (a) enter into any employment agreement or other written compensation agreement that has a term of greater than one year with any of Borrower's executive officers or (b) increase total compensation, without regard to commissions, paid to the executive officers of Borrower by more than ten percent (10%) per year; provided, however, that the Company may hire a controller and/or Chief Financial Officer which shall not constitute an increase in total base compensation paid to the executive officers for purposes of this section 3.18. 3.19 Environment. Borrower shall be and remain in compliance with the provisions of all federal, state and local environmental, health, and safety laws, codes and ordinances, and all rules and regulations issued thereunder; notify Lender immediately of any notice of a hazardous discharge or environmental complaint received from any governmental agency or any other party; notify Lender immediately of any hazardous discharge from or affecting its premises; immediately contain and remove the same, in compliance with and to the extent required by all applicable laws; promptly pay any fine or penalty assessed in connection therewith, except to the extent Borrower in good faith contests any such fine or penalty to the extent Borrower follows all applicable laws in so doing; permit Lender to inspect the premises, to conduct tests thereon, and to inspect all books, correspondence, and records pertaining thereto; and at Lender's request, and at Borrower's expense, provide a report of a qualified environmental engineer, satisfactory in scope, form, and content to Lender, and such other and further assurances reasonably satisfactory to Lender that the condition has been corrected. 3.20 Landlord Consents. Borrower shall use its best efforts to obtain a Landlord Consent and Subordination of Lien, in a form reasonably satisfactory to Lender, from each landlord from whom Borrower now or hereafter may lease space. 3.21 Issuance of Membership Interests. Without the prior written consent of Lender, Borrower shall not issue any membership interests of Borrower or securities convertible into or exercisable for membership interests of Borrower, except in conjunction with the Avalon Transaction (as defined in Section 4.1(r)), with the issuance of any membership interests contemplated by Sections 3.3(b) or 3.12 of Borrower's Operating Agreement, or with any employee membership interest option plan of Borrower. Notwithstanding the foregoing sentence, Borrower is prohibited from issuing or having outstanding more than fifteen percent (15%) of its total membership interests under any such employee option plan. ARTICLE 4 CONDITIONS TO CLOSING 14 4.1 Closing of the Loan. The obligation of Lender to fund the Loan on the date hereof (the "Closing Date") is subject to the fulfillment, on or prior to the Closing Date, of each of the following conditions: (a) Borrower shall have performed and complied in all material respects with all of the covenants, agreements, obligations and conditions required by this Agreement. (b) Lender shall have received an opinion of the Borrower's counsel, LeClair Ryan, a Professional Corporation, dated the Closing Date, in form and substance satisfactory to Lender's counsel. (c) Borrower shall have delivered to Lender a Note executed by Borrower, in form and substance satisfactory to Lender. (d) Borrower shall have delivered to Lender a Membership Interest Purchase Warrant executed by Borrower, in form and substance satisfactory to Lender, and the related Warrant Valuation Letter executed by Borrower. (e) Borrower shall have delivered to Lender a Security Agreement and related UCC-1 Financing Statement(s), executed by Borrower, each of which is in form and substance satisfactory to Lender. (f) Borrower shall have delivered to Lender a Pledge and Security Agreement and related membership interest certificates, if any, membership interest powers and voting proxies executed by NFI and Kenneth C. Clarry, in form and substance satisfactory to Lender. (g) Borrower shall have delivered to Lender a Landlord's Consent and Subordination of Lien, executed by each of Borrower's landlords, in form and substance satisfactory to Lender. (h) Borrower shall have delivered to Lender an Assignment of Life Insurance Policy as Collateral executed by Borrower in duplicate, and a Life Insurance Assignment Questionnaire executed by Borrower with respect to an insurance policy insuring the life of Kenneth C. Clarry, in form and substance satisfactory to Lender, upon issuance of the policy. (i) Borrower shall have delivered to Lender an Intellectual Property Security Agreement executed by Borrower, in form and substance satisfactory to Lender. (j) Borrower shall have delivered to Lender an Authorization Agreement for Pre-Authorized Payments (Debit) executed by Borrower, in form and substance satisfactory to Lender. 15 (k) Borrower shall have delivered to Lender Guaranty Agreements, one executed by Kenneth C. Clarry and one by NFI, each in form and substance satisfactory to Lender. (l) Borrower shall have delivered to Lender copies of the Certificate of Formation and other publicly filed organizational documents of Borrower, certified by the Secretary of State or other appropriate public official in the state of Delaware, and a copy of Borrower's Operating Agreement. (m) Borrower shall have delivered to Lender certified (as of the date of this Agreement) copies of all corporate action taken by Borrower, including resolutions of its Board of Managers, authorizing the execution, delivery and performance of the Loan Documents. (n) Borrower shall have delivered to Lender a certificate as to the legal existence and good standing of the Borrower, issued by the Secretary of State or other appropriate public official in the state of Delaware. (o) Borrower shall have delivered to Lender certificates of the Secretaries of State or other appropriate public officials as to Borrower's qualification to do business and good standing in each jurisdiction in which a failure to be so qualified would have a material adverse effect on its financial condition or its ability to conduct its business in the manner now conducted and as hereafter intended to be conducted. (p) Borrower shall have delivered to Lender the Small Business Administration Forms 480, 652 and 1031 (Parts A and B) completed by Borrower. (q) Borrower shall have delivered to Lender the Small Business Administration Economic Impact Assessment completed by Borrower, in form and substance satisfactory to Lender. (r) Borrower shall have completed the sale of Membership Interests to Avalon Equity Fund, L.P., for a total of not less than Two Million One Hundred Thousand Dollars ($2,100,000) (the "Avalon Transaction"), as evidenced by the execution of Borrower's Operating Agreement and the Investment and Membership Interest Subscription Agreement of even date herewith, a copy of which is attached hereto as Exhibit 4.1(r) (the "Investment Agreement"). (s) Borrower shall have delivered to Lender evidence reasonably satisfactory to Lender that (A) NFI has transferred substantially all of its assets to Borrower and (B) the transactions contemplated by the Investment Agreement shall have closed or shall close without any condition other than the passage of time as contemplated by the Investment Agreement. ARTICLE 5 DEFAULT AND REMEDIES 16 5.1 Events of Default. The occurrence of any of the following shall constitute an Event of Default hereunder: (a) Default in the payment of the principal of or interest on the indebtedness evidenced by the Note in accordance with the terms of the Note, which default is not cured within five (5) days of receipt of written notice; (b) Any misrepresentation by Borrower, any guarantor of the Loan, or any Affiliate as to any material matter hereunder or under any of the other Loan Documents, or delivery by Borrower of any schedule, statement, resolution, report, certificate, notice or writing to Lender that is untrue in any material respect on the date as of which the facts set forth therein are stated or certified; (c) Failure of Borrower, any guarantor of the Loan, or any Affiliate to perform any of its obligations, covenants or agreements under this Agreement, the Note or any of the other Loan Documents; (d) Borrower (i) shall generally not pay or shall be unable to pay its debts as such debts become due, or (ii) shall make an assignment for the benefit of creditors or petition or apply to any tribunal for the appointment of a custodian, receiver or trustee for it or a substantial part of its assets, or (iii) shall commence any proceeding under any bankruptcy, reorganization, arrangement, readjustment of debt, dissolution or liquidation law or statute of any jurisdiction, whether now or hereafter in effect, or (iv) shall have had any such petition or application filed or any such proceeding commenced against it that is not dismissed within thirty (30) days, or (v) shall indicate, by any act or intentional and purposeful omission, its consent to, approval of or acquiescence in any such petition, application, proceeding or order for relief or the appointment of a custodian, receiver or trustee for it or a substantial part of its assets, or (vi) shall suffer any such custodianship, receivership or trusteeship to continue undischarged for a period of sixty (60) days or more; (e) Borrower shall be liquidated, dissolved, partitioned or terminated, or the charter or certificate of formation thereof shall expire or be revoked; (f) A default or event of default shall occur under any of the other Loan Documents and, if subject to a cure right, such default or event of default shall not be cured within the applicable cure period; (g) Borrower shall default in the timely payment or performance of any obligation now or hereafter owed to Lender in connection with any other indebtedness of Borrower now or hereafter owed to Lender; (h) Borrower shall have defaulted and continue to be in default in the timely payment of or performance of any covenant relating to any other indebtedness or obligation, which in the aggregate exceeds Fifty Thousand and No/100ths Dollars 17 ($50,000.00) or materially adversely affects Borrower's operations, properties or financial condition; (i) A significant change in the executive staff, ownership, or management of Borrower or NFI shall occur; or (j) Lender in good faith based on substantiated evidence believes its prospect of payment and performance is materially impaired. With respect to any Event of Default described above that is capable of being cured and that does not already provide its own cure procedure (a "Curable Default"), the occurrence of such Curable Default shall not constitute an Event of Default hereunder if such Curable Default is fully cured and/or corrected within thirty (30) days (ten (10) days, if such Curable Default may be cured by payment of a sum of money) of notice thereof to Borrower given in accordance with the provisions hereof; provided, however, that this provision shall not require notice to Borrower and an opportunity to cure any Curable Default of which Borrower has had actual knowledge for the requisite number of days set forth. 5.2 Acceleration of Maturity; Remedies. Upon the occurrence of any Event of Default described in subsection 5.1(d), the indebtedness evidenced by the Note as well as any and all other indebtedness of Borrower to Lender shall be immediately due and payable in full; and upon the occurrence of any other Event of Default described above, Lender at any time thereafter may at its option accelerate the maturity of the indebtedness evidenced by the Note as well as any and all other indebtedness of Borrower to Lender; all without notice of any kind. Upon the occurrence of any such Event of Default and the acceleration of the maturity of the indebtedness evidenced by the Note: (a) Lender shall be immediately entitled to exercise any and all rights and remedies possessed by Lender pursuant to the terms of the Note and all of the other Loan Documents; and (b) Lender shall have any and all other rights and remedies that Lender may now or hereafter possess at law, in equity or by statute. 5.3 Remedies Cumulative; No Waiver. No right, power or remedy conferred upon or reserved to Lender by this Agreement or any of the other Loan Documents is intended to be exclusive of any other right, power or remedy, but each and every such right, power and remedy shall be cumulative and concurrent and shall be in addition to any other right, power and remedy given hereunder, under any of the other Loan Documents or now or hereafter existing at law, in equity or by statute. No delay or omission by Lender to exercise any right, power or remedy accruing upon the occurrence of any Event of Default shall exhaust or impair any such right, power or remedy or shall be construed to be a waiver of any such Event of Default or an acquiescence therein, and every right, power and remedy given by this Agreement and the other Loan Documents to Lender may be exercised from time to time and as often as may be deemed expedient by Lender. 18 5.4 Proceeds of Remedies. Any or all proceeds resulting from the exercise of any or all of the foregoing remedies shall be applied as set forth in the Loan Document(s) providing the remedy or remedies exercised, if none is specified, or if the remedy is provided by this Agreement, then as follows: First, to the costs and expenses, including without limitation reasonable attorneys' fees and disbursements, incurred by Lender in connection with the exercise of its remedies; Second, to the expenses of curing the default that has occurred, in the event that Lender elects, in its sole discretion, to cure the default that has occurred; Third, to the payment of the Obligations of Borrower, including but not limited to the payment of the principal of and interest on the indebtedness evidenced by the Note, in such order of priority as Lender shall determine in its sole discretion; and Fourth, the remainder, if any, to Borrower or to any other person lawfully thereunto entitled. ARTICLE 6 TERMINATION 6.1 Termination of this Agreement. This Agreement shall remain in full force and effect until the payment in full by Borrower of the Obligations, at which time Lender shall cancel the Note and deliver it to Borrower; provided, however, that the indemnities provided in Section 7.15 shall survive the termination of this Agreement. ARTICLE 7 MISCELLANEOUS 7.1 Performance By Lender. If Borrower shall default in the payment, performance or observance of any covenant, term or condition of this Agreement, which default is not cured within the applicable cure period, then Lender may, at its option, pay, perform or observe the same, and all payments made or costs or expenses incurred by Lender in connection therewith (including but not limited to reasonable attorneys' fees), with interest thereon at the highest default rate provided in the Note, shall be immediately repaid to Lender by Borrower and shall constitute a part of the Obligations. Lender shall be the sole judge of the necessity for any such actions and of the amounts to be paid. 7.2 Successors and Assigns Included in Parties. Whenever in this Agreement one of the parties hereto is named or referred to, the heirs, legal representatives, successors, successors-in-title and assigns of such parties shall be included, and all covenants and agreements contained in this Agreement by or on behalf of Borrower or by or on behalf of Lender shall bind and inure to the benefit of their respective heirs, legal representatives, successors-in-title and assigns, whether so expressed or not. 19 7.3 Costs and Expenses. Borrower agrees to pay all reasonable costs and expenses incurred by Lender in connection with the making of the Loan, including but not limited to filing fees, recording taxes and reasonable attorneys' fees, promptly upon demand of Lender. Borrower further agrees to pay all premiums for insurance required to be maintained by Borrower pursuant to the terms of the Loan Documents and all of the out-of-pocket costs and expenses incurred by Lender in connection with the collection of the Loan, amendment to the Loan Documents, or prepayment of the Loan, including but not limited to reasonable attorneys' fees, promptly upon demand of Lender. 7.4 Assignment. The Note, this Agreement and the other Loan Documents may be endorsed, assigned and/or transferred in whole or in part by Lender, and any such holder and/or assignee of the same shall succeed to and be possessed of the rights and powers of Lender under all of the same to the extent transferred and assigned. Lender may grant participations in all or any portion of its interest in the indebtedness evidenced by the Note, and in such event Borrower shall continue to make payments due under the Loan Documents to Lender and Lender shall have the sole responsibility of allocating and forwarding such payments in the appropriate manner and amounts. Borrower shall not assign any of its rights nor delegate any of its duties hereunder or under any of the other Loan Documents without the prior written consent of Lender. 7.5 Time of the Essence. Time is of the essence with respect to each and every covenant, agreement and obligation of Borrower hereunder and under all of the other Loan Documents. 7.6 Severability. If any provision(s) of this Agreement or the application thereof to any person or circumstance shall be invalid or unenforceable to any extent, the remainder of this Agreement and the application of such provisions to other persons or circumstances shall not be affected thereby and shall be enforced to the greatest extent permitted by law. 7.7 Interest and Loan Charges Not to Exceed Maximum Allowed by Law. Anything in this Agreement, the Note or any of the other Loan Documents to the contrary notwithstanding, in no event whatsoever, whether by reason of advancement of proceeds of the Loan, acceleration of the maturity of the unpaid balance of the Loan or otherwise, shall the interest and other charges agreed to be paid to Lender for the use of the money advanced or to be advanced hereunder exceed the maximum amounts collectible under applicable laws in effect from time to time. It is understood and agreed by the parties that, if for any reason whatsoever the interest or loan charges paid or contracted to be paid by Borrower in respect of the indebtedness evidenced by the Note shall exceed the maximum amounts collectible under applicable laws in effect from time to time, then ipso facto, the obligation to pay such interest and/or loan charges shall be reduced to the maximum amounts collectible under applicable laws in effect from time to time, and any amounts collected by Lender that exceed such maximum amounts shall be applied to the reduction of the principal balance of the indebtedness evidenced by the Note and/or refunded to Borrower so that at no time shall the interest or loan charges paid or payable in respect of the indebtedness evidenced by the Note exceed the maximum amounts permitted from time to time by applicable law. 20 7.8 Article and Section Headings; Defined Terms. Numbered and titled article and section headings and defined terms are for convenience only and shall not be construed as amplifying or limiting any of the provisions of this Agreement. 7.9 Notices. Any and all notices, elections or demands permitted or required to be made under this Agreement shall be in writing, signed by the party giving such notice, election or demand and shall be delivered personally, telecopied, or sent by certified mail or overnight via nationally recognized courier service (such as Federal Express), to the other party at the address set forth below, or at such other address as may be supplied in writing and of which receipt has been acknowledged in writing. The date of personal delivery or telecopy or two (2) business days after the date of mailing (or the next business day after delivery to such courier service), as the case may be, shall be the date of such notice, election or demand. For the purposes of this Agreement: The Address of Lender is: Commerce Capital, L.P. Suite 2602 611 Commerce Street Nashville, TN 37203 Attention: Rudy Ruark Telecopy No.: 615/244-1432 with a copy to: Baker, Donelson, Bearman & Caldwell Suite 1700 511 Union Street Nashville, TN 37219 Attention: James L. McElroy, Esq. Telecopy No.: 615/726-0464 The Address of Borrower is: NeighborhoodFind.com, LLC 1228 Cedars Court P.O. Box 7786 Charlottesville, Virginia 22906 Attention: Kenneth C. Clarry Telecopy No.: 804/984-5111 with a copy to: LeClair Ryan, A Professional Corporation 707 East Main Street, Eleventh Floor Richmond, Virginia 23219 Attention: Gary D. LeClair, Esq. Telecopy No.: 804/783-2294 21 7.10 Entire Agreement. This Agreement and the other written agreements between Borrower and Lender represent the entire agreement between the parties concerning the subject matter hereof, and all oral discussions and prior agreements are merged herein; provided, if there is a conflict between this Agreement and any other document executed contemporaneously herewith with respect to the Obligations, the provision of this Agreement shall control. The execution and delivery of this Agreement and the other Loan Documents by Borrower were not based upon any fact or material provided by Lender, nor was Borrower induced or influenced to enter into this Agreement or the other Loan Documents by any representation, statement, analysis or promise by Lender. 7.11 Governing Law and Amendments. This Agreement shall be construed and enforced under the laws of the State of Tennessee applicable to contracts to be wholly performed in such State. No amendment or modification hereof shall be effective except in a writing executed by each of the parties hereto. 7.12 Survival of Representations and Warranties. All representations and warranties contained herein or in any of the Loan Documents or made by or furnished on behalf of Borrower in connection herewith or in any Loan Documents shall survive the execution and delivery of this Agreement and the other Loan Documents. 7.13 Counterparts. This Agreement may be executed by facsimile, in any number of counterparts and by different parties to this Agreement in separate counterparts, each of which when so executed shall be deemed to be an original and all of which taken together shall constitute one and the same Agreement. 7.14 Construction and Interpretation. Should any provision of this Agreement require judicial interpretation, the parties hereto agree that the court interpreting or construing the same shall not apply a presumption that the terms hereof shall be more strictly construed against one party by reason of the rule of construction that a document is to be more strictly construed against the party that itself or through its agent prepared the same, it being agreed that Borrower, Lender and their respective agents have participated in the preparation hereof. 7.15 General Indemnification. Borrower agrees to indemnify Lender, its officers, directors, employees and agents (individually, an "Indemnified Party" and collectively, the "Indemnified Parties") and each of them and agrees to hold each of them harmless from and against any and all losses, liabilities, damages, costs, expenses and claims of any and every kind whatsoever (except those arising solely by reason of the gross negligence or wilful misconduct of an Indemnified Party) which may be imposed on, incurred by, or asserted against the Indemnified Parties or any of them arising by reason of any action or inaction or omission to any act legally required of Borrower (including as required pursuant hereto or pursuant to any other Loan Document). 7.16 Standard of Care; Limitation of Damages. Lender shall be liable to Borrower only for matters arising from this Agreement or otherwise related to the Obligations resulting from Lender's gross negligence or willful misconduct, and liability for all other matters is 22 hereby waived. Lender shall not in any event be liable to Borrower for special or consequential damages arising from this Agreement or otherwise related to the Obligations. 7.17 Consent to Jurisdiction; Exclusive Venue. Borrower hereby irrevocably consents to the jurisdiction of the United States District Court for the Middle District of Tennessee and of all Tennessee state courts sitting in Davidson County, Tennessee, for the purpose of any litigation to which Lender may be a party and which concerns this Agreement or the Obligations. It is further agreed that venue for any such action shall lie exclusively with courts sitting in Davidson County, Tennessee, unless Lender agrees to the contrary in writing. 7.18 Waiver of Trial by Jury. LENDER AND BORROWER HEREBY KNOWINGLY AND VOLUNTARILY WITH THE BENEFIT OF COUNSEL WAIVE TRIAL BY JURY IN ANY ACTIONS, PROCEEDINGS, CLAIMS OR COUNTER-CLAIMS, WHETHER IN CONTRACT OR TORT OR OTHERWISE, AT LAW OR IN EQUITY, ARISING OUT OF OR IN ANY WAY RELATING TO THIS AGREEMENT OR THE LOAN DOCUMENTS. [SIGNATURES ON THE FOLLOWING PAGE] 23 [SIGNATURE PAGE TO LOAN AGREEMENT] IN WITNESS WHEREOF, the parties hereto have executed this Agreement, or have caused this Agreement to be executed by their duly authorized officers, as of the day and year first above written. LENDER: COMMERCE CAPITAL, L.P. a Tennessee limited partnership By: Commerce Equity Capital Corporation Title: General Partner By: /s/ Rudy Ruark ------------------------------------ Title: Vice President ------------------------------------ BORROWER: NEIGHBORHOODFIND.COM, LLC, a Delaware limited liability company By: /s/ Kenneth C. Clarry ------------------------------------------- Title: President ------------------------------------------- 24 EX-10 11 e765422.txt EXHIBIT 10.5 Exhbit 10.5 AMENDMENT NO. 1 TO LOAN AGREEMENT THIS AMENDMENT NO. 1 TO LOAN AGREEMENT ("Amendment") is entered as of the 30th day of November, 2000, by and between NeighborhoodFind.com, LLC, a Delaware limited liability company ("Borrower") and Commerce Capital, L.P., a Tennessee limited partnership ("Lender"). RECITALS: WHEREAS, Borrower and Lender are parties to a Loan Agreement dated as of June 13, 2000 (the "Original Loan Agreement"), pursuant to which Lender loaned to Borrower the sum of $800,000 (the "Initial Loan"); and WHEREAS, to secure repayment of principal of and interest on the Original Loan, Borrower and Lender entered a Security Agreement dated as of June 13, 2000 (the "Original Security Agreement"), and an Intellectual Property Security Agreement dated as of June 13, 2000 (the "Original Intellectual Property Security Agreement"); and WHEREAS, Borrower has requested that Lender loan to Borrower an additional $380,000 (the "Subsequent Advance"), and Lender is willing to do so, subject, among other things, to Borrower's execution and delivery of this Amendment and various other documents. NOW, THEREFORE, in consideration of the premises, Lender's willingness subject to the terms and conditions hereof to make the Subsequent Advance, and other good and valuable consideration, receipt and sufficiency of which are hereby acknowledged, Borrower and Lender hereby agree as follows: 1. Subsequent Advance. Subject to the terms and conditions hereof, Lender agrees to make the Subsequent Advance to Borrower, by wire transfer of immediately available funds pursuant to Borrower's written instructions. The Subsequent Advance shall be evidenced by a Secured Promissory Note of even date herewith, executed by Borrower in favor of Lender (the "Subsequent Note"). 2. Amendment of Original Loan Agreement. The first "WHEREAS" clause in the Original Loan Agreement, under the heading "RECITALS", is hereby amended, by deleting the second parenthetical phrase in the second line thereof and inserting in its place the parenthetical phrase "(together with any amounts subsequently advanced by Lender to Borrower, the "Loan")". Section 1.1 of the Original Loan Agreement is hereby amended, by (a) deleting the parenthetical phrase in the fifth line thereof and inserting in its place the parenthetical phrase "(together with any promissory notes subsequently executed by Borrower in favor of Lender, or any amendments or restatements of any of the foregoing, the "Note")"; and (b) inserting in the sixth line thereof, immediately after the words "and any other instruments and documents" the words "as amended from time to time". 3. Ratification and Reaffirmation of Loan Documents. The Borrower hereby ratifies and reaffirms its obligations under each of the Loan Documents and agrees that any reference in any of such Loan Documents to the Note, the Loan, the Obligations, or words of like effect shall include the Note, the Loan and the Obligations as defined in the Original Loan Agreement, the Original Security Agreement, and the Original Intellectual Property Security Agreement and the debt and obligations of Borrower under this Amendment and the Subsequent Note. 4. Representations and Warranties of Borrower. Borrower hereby reaffirms, and represents and warrants to Lender as of the date of this Amendment, each of the representations and warranties contained in ARTICLE 2 of the Original Loan Agreement, except (a) as otherwise provided in any schedules to the Original Loan Agreement, (b) for changes in the financial condition of Borrower resulting from the operation of its business in the ordinary course, as reflected on the interim, unaudited financial statements delivered to Lender since the date of the Original Loan Agreement, and (c) as set forth on Schedule 4 hereto. 5. Conditions to Effectiveness. The following shall be conditions precedent to the effectiveness of this Amendment and the obligations of Lender to make the Subsequent Advance: (a) Lender shall have received an opinion of Borrower's counsel regarding the effectiveness and enforceability of this Amendment and the other documents related hereto, in form and substance reasonably satisfactory to Lender; (b) Borrower shall have paid to Lender a processing fee in the amount of $7,600 and shall have reimbursed Lender for its expenses in connection herewith, including reasonable attorney's fees; and (c) Lender shall have received such other documents, including without limitation forms required to be completed and filed by the United States Small Business Administration, as Lender shall reasonably request. 6. Effect on Original Loan Agreement. Upon the satisfaction of the conditions precedent set forth above, the original Loan Agreement shall be amended as provided in this Amendment, and all references in any of the Loan Documents (as defined in the Loan Agreement) shall be deemed to mean the Original Agreement as amended by this Amendment. IN WITNESS WHEREOF, the Borrower and the Lender have each caused this Amendment to be executed and delivered by their duly authorized officers as of the day and year first above written. NEIGHBORHOODFIND.COM, LLC By:----------------------------------------- Title:-------------------------------------- COMMERCE CAPITAL, L.P. Commerce Equity Capital By: Corporation, General Partner --------------------------------------- By:----------------------------------------- Title:-------------------------------------- EX-99 12 e765491.txt EXHIBIT 99.1 Exhibit 99.1 MONSTERDAATA CONCLUDES ACQUISITION OF NEIGHBORHOODFIND NEW YORK, NY - AUGUST 1, 2001 -- MonsterDaata, Inc. (OTCBB:MSRD) reported today that the previously announced merger with NeighborhoodFind closed yesterday right on schedule. "Integration plans are well underway and I am pleased to announce that beneficial customer product enhancements will be forthcoming before August is complete," said Samuel Petteway, CEO and President of MonsterDaata. Monsterdaata provides property, school and census related information primarily to Real Estate related companies. Providing lead generation tools and an Internet-based local community presence to over five thousand Realtor sponsors is a natural progression of the MonsterDaata business model. CONTACT: Harold Blue Vice Chairman MonsterDaata, Inc. 212-829-5891 EX-99 13 e765493.txt EXHIBIT 99.2 Exhibit 99.2 MONSTERDAATA ENTERS INTO AN AGREEMENT TO ACQUIRE NEIGHBORHOODFIND NEW YORK, NY AND CHARLOTTESVILLE, VA, JULY 24, 2001: MonsterDaata, Inc. (OTCBB: MSRD) and NeighborhoodFind.com LLC are pleased to announce a definitive agreement has been signed for the two companies to merge. The all-stock transaction is expected to close August 1, 2001 and will provide NeighborhoodFind shareholders with 22% of MonsterDaata's outstanding stock, options and warrants. NeighborhoodFind adds $2 million in recurring annual subscription revenues and an established nationwide sales force. The transaction combines the nation's leading neighborhood information and web-based direct marketing company with the leading provider of technology and content to the Real Estate industry. NeighborhoodFind has over 11,000 active on-line neighborhoods nationwide and over 5,000 Realtor sponsors. MonsterDaata provides comprehensive neighborhood, school and property information that can be drilled down to the census block level, thereby offering consumers and Real Estate professionals the most relevant community specific information. "This acquisition jump-starts our efforts to offer Realtors a direct subscription product", said Sam Petteway, MonsterDaata's CEO. "With NeighborhoodFind's 5,000+ Realtor customers and a staff of 30 sales associates, we are positioned to rapidly penetrate the market of over 700,000 Realtors. NeighborhoodFind's model fits ours perfectly and will help solidify a high double-digit growth rate for MonsterDaata going forward." "Together we can supply our current and future Realtor customers with a web based direct marketing program that will be unparalleled in the industry," says Jim Gayhart, NeighborhoodFind's CEO. "MonsterDaata's strong technology base and data repository for neighborhood specific information, coupled with our current products and national sales force will make a powerful combination." NeighborhoodFind, based in Charlottesville, VA, provides a Web site that serves as a community resource, neighborhood communications tool and relocation solution. With over 19,000 cities online, the site includes thousands of U.S. neighborhoods and serves as a one-stop resource for community information. The site offers neighborhood details, photos, and communication tools, including Neighborhood News, Community Calendar, Local Government News, free Web sites, local school and business information, and relocation services. MonsterDaata has developed advanced data compilation and delivery technology designed to transform and distribute significant amounts of information from disparate sources for Real Estate related industries. The company derives revenue through the distribution of Real Estate related content and applications solutions in a highly customizable, flexible manner. Data is delivered using industry standard protocols like XML, WML, PDA and customized HTML. The statements contained in this release which are not historical facts contain forward-looking statements with respect to events, the occurrence of which involve risks and uncertainties, including, without limitation, the risks and uncertainties detailed in MonsterDaata's Securities and Exchange Commission filings. CONTACT: Harold Blue Vice Chairman MonsterDaata, Inc. 212-829-5891 ### -----END PRIVACY-ENHANCED MESSAGE-----