CHEGG ACQUIRES IMAGINE EASY SOLUTIONS, A MARKET LEADER OF ONLINE WRITING TOOLS

Writing Tools Used by More Than 7 Million Unique Users Monthly;

Accretive to Chegg in Fiscal 2016

SANTA CLARA, Calif., May 2, 2016 - Chegg, Inc. (NYSE: CHGG), the Student Hub, today announced that it has acquired Imagine Easy Solutions (“Imagine Easy”), the provider of popular service EasyBib.com and other essential writing tools with capabilities such as citations, bibliography, writing structure and anti-plagiarism, used by more than 7 million unique users in March 2016.

“We know that writing is one of the biggest pain points for students today, with about one quarter of all college freshmen required to take remedial writing courses and employers rating less than 30% of recent graduates as being well prepared written communicators,” said Dan Rosensweig, Chairman and CEO of Chegg. “Inability to write at the college level is a leading indicator of which students will eventually drop out, a situation that adversely impacts both the student and the school. With this acquisition, Chegg now has the ability to serve the millions of students who depend on writing help every day, in particular those students required to take remedial writing classes.”

Chegg has acquired Imagine Easy for approximately $42 million in an all-cash transaction, approximately $25 million of which was paid at closing and $17 million of which is to be paid by April 2017. There are potential additional payments of up to $18 million over the next three years that remain subject to contingencies. These contingent payments may be settled either in cash or common stock, at the discretion of Chegg.

Similar to Chegg’s existing revenue model, Imagine Easy’s diversified revenues are composed of subscriptions and digital advertising. The transaction is anticipated to be accretive to Chegg’s fiscal 2016 revenues and earnings.

Writing deficiencies have become one of the biggest education issues today and writing is the most frequently requested area for help among high school and college students:

Imagine Easy’s subscription products include EasyBib, Citation Machine, BibMe, Cite This for Me, and Normas APA, which is available in Spanish. In the last 12 months, students logged more than 240 million individual online sessions, lasting an average of more than 8 minutes per session. Since their launch, students worldwide have created approximately 1.4 billion citations using Imagine Easy’s writing productivity tools.

“Imagine Easy and Chegg share the same vision and mission to develop and offer leading, student-first tools that help students improve their outcomes,” said Neal Taparia, co-CEO and co-Founder of Imagine Easy. “By joining Chegg, we accelerate our plans for delivering a complete suite of writing tools that democratize access to great educational resources and provide students with the academic support they need,” said Darshan Somashekar, co-CEO and co-Founder of Imagine Easy. Both co-Founders will be joining Chegg as full time employees.

Chegg will address investor questions about the transaction during its upcoming quarterly earnings call on May 2, 2016. To access the call, please dial (877) 407-4018, or outside the U.S. +1 (201) 689-8471, five minutes prior to 1:30 p.m. Pacific Daylight Time (or 4:30 p.m. Eastern Daylight Time) on May 2, 2016. More information about the acquisition can be found at by emailing press@chegg.com. To explore the Imagine Easy platform, visit www.imagineeasy.com .

Vista Point Advisors, a San Francisco based boutique investment bank, acted as the exclusive financial advisor to Imagine Easy.

Deborah Quazzo of GSV Advisors personally advised the founders of Imagine Easy with consulting services and industry insight.

ABOUT CHEGG

Chegg puts students first. As the leading student-first connected learning platform, the company makes higher education more affordable, more accessible, and more successful for students. Chegg is a publicly-held company based in Santa Clara, California and trades on the NYSE under the symbol CHGG. For more information, visit www.chegg.com .

SAFE HARBOR STATEMENT

This press release may be deemed to contain forward-looking statements, which are subject to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995, including Chegg’s belief that it, through its acquisition of Imagine Easy, will have the ability to serve millions of students in the area of writing; Chegg’s belief that the transaction will be accretive to Chegg’s fiscal 2016 revenues and earnings; Chegg’s belief that acquisition of Imagine Easy will help it grow faster and globally and that Imagine Easy’s tools and services will improve to help students; and Chegg’s belief that the acquisition of Imagine Easy will accelerate the plans for delivering a complete suite of writing tools that democratize access to educational resources and provide students with the academic support they need. Statements regarding future events are based on management’s current expectations and are necessarily subject to associated risks related to, among other things, the potential impact on the business of Imagine Easy due to the acquisition, general economic conditions, competition, and integration risks, among others. Therefore, actual results, performance or achievements may differ materially and adversely from those expressed in any forward-looking statements. For information regarding other related risks, see the “Risk Factors” section of Chegg’s Annual Report on Form 10-K for the fiscal year ended December 31, 2015 filed with the Securities and Exchange Commission (“SEC”) on March 4, 2016 and Chegg’s other SEC filings. You can obtain copies of Chegg’s SEC filings on the SEC’s website at www.sec.gov or at Chegg’s Investor Relations website at investor.chegg.com . The forward-looking statements included herein are made only as of the date hereof, and Chegg undertakes an obligation to revise or update any forward-looking statements for any reason except as required by law.

Investor contact: Amy Feng, ir@chegg.com, or Media contact: Usher Lieberman, press@chegg.com

ⁱ http://reachcap.com/assets/uploads/reimagined_2015.pdf

ⁱⁱ https://edreformnow.org/policy-briefs/out-of-pocket-the-high-cost-of-inadequate-high-schools-and-high-school-student-achievement-on-college-affordability/

ⁱⁱⁱ http://completecollege.org/wp-content/uploads/2014/11/4-Year-Myth.pdf

        

Chegg Reports First Quarter 2016 Results

Strong Chegg Services Revenue Growth Driven by 37% Increase in Subscribers

Strategic Acquisition of a Leading Online Writing Tools Company is Accretive in Fiscal 2016

SANTA CLARA, Calif., May 2, 2016 /PRNewswire/ -- Chegg, Inc. (NYSE:CHGG), the Student Hub, today reported financial results for the three months ended March 31, 2016. 

“Chegg is off to a great start in 2016 as we saw strong momentum across our businesses, highlighted by 37% subscriber growth in Chegg Services,” said Dan Rosensweig, Chairman and CEO of Chegg. “We are also excited to announce the strategic acquisition of Imagine Easy Solutions, a leading provider of online writing tools. With this acquisition, Chegg now has the ability to help students address one of their biggest academic pain points, writing. This issue is underscored by the fact that nearly 25% of incoming freshmen who are required to take remedial writing courses.”

An updated investor presentation and an investor data sheet can be found on Chegg’s Investor Relations website http://investor.chegg.com .

Q1 2016 Financial Highlights:

Pro forma revenue and the related year-over-year percentage increase presents revenue as if the transition of textbook inventory investment and textbook logistics and fulfillment functions for Chegg’s print textbook business to Ingram Content Group (Ingram) was complete and the revenue from print textbook business was entirely commission-based. For more information about pro forma revenue and a reconciliation of pro forma revenue to revenue, see the sections of the press release titled “Use of Non-GAAP Measures” and “Reconciliation of GAAP to Non-GAAP Financial Measures”.

Q1 2016 Business Highlights:

Business Outlook:

Our outlook for the second quarter of and fiscal year 2016 is comprised of two revenue streams: Required Materials revenue which includes print textbooks, eTextbooks, and Ingram commission revenue; and Chegg Services revenue, which includes Chegg Study, Chegg Tutors, Enrollment Marketing, Brand Partnerships and Careers.

Second Quarter 2016 

Adjusted EBITDA guidance for the second quarter includes approximately $2.8 million for textbook depreciation and excludes approximately $10.5 million for stock-based compensation expense, $0.6 million for amortization of intangible assets; and $1.0 million for acquisition-related costs. It does not include an amortization for intangible assets of Imagine Easy Solutions as the amount of any such amortization cannot be appropriately estimated at this time. It assumes, among other things, that no additional business acquisitions, investments, restructuring actions, or legal settlements are concluded and that there are no further revisions to stock-based compensation estimates.

Fiscal Year 2016 

Fiscal 2016 guidance includes approximately $7 million in revenue and $2 million in Adjusted EBITDA from the Imagine Easy Solutions acquisition.

Adjusted EBITDA guidance for fiscal 2016 includes approximately $10.5 million for textbook depreciation and excludes approximately $44 million for stock-based compensation expense; $2.2 million for amortization of intangible assets; credit of $44,000 for restructuring charges; and $5.0 million for acquisition-related costs. It does not include an amortization for intangible assets of Imagine Easy Solutions as the amount of any such amortization cannot be appropriately estimated at this time. It assumes, among other things, that no additional business acquisitions, investments, restructuring actions, or legal settlements are concluded and that there are no further revisions to stock-based compensation estimates. 

Conference Call and Webcast Information

To access the call, please dial (877) 407-4018, or outside the U.S. +1 (201) 689-8471, five minutes prior to 1:30 p.m. Pacific Standard Time (or 4:30 p.m. Eastern Standard Time) on May 2, 2016. A live webcast of the call will also be available at http://investor.chegg.com under the Events & Presentations menu. An audio replay will be available beginning at 8:00 p.m. Eastern Standard Time May 2, 2016, until 11:59 p.m. Eastern Standard Time May 9, 2016, by calling (877) 870-5176 or +1 (858) 384-5517, with Conference ID 13634835. An audio archive of the call will also be available at http://investor.chegg.com .

Use of Investor Relations Website for Regulation FD Purposes

Chegg also uses its media center website, http://www.chegg.com/mediacenter , as a means of disclosing material non-public information and for complying with its disclosure obligations under Regulation FD. Accordingly, investors should monitor  http://www.chegg.com/mediacenter , in addition to following press releases, Securities Exchange Commission filings and public conference calls and webcasts.

About Chegg

Chegg puts students first. As the leading student-first connected learning platform, the company makes higher education more affordable, more accessible, and more successful for students. Chegg is a publicly-held company based in Santa Clara, California and trades on the NYSE under the symbol CHGG. For more information, visit www.chegg.com .

Use of Non-GAAP Measures

To supplement Chegg’s financial results presented in accordance with U.S. generally accepted accounting principles (GAAP), this press release and the accompanying tables and the related earnings conference call contain non-GAAP financial measures, including pro forma revenue, adjusted EBITDA, non-GAAP gross profit and margin, non-GAAP operating expenses, non-

GAAP net loss and non-GAAP net loss per share. For reconciliations of these non-GAAP financial measures to the most directly comparable GAAP financial measures, please see the section of the accompanying tables titled, “Reconciliation of GAAP to Non-GAAP Financial Measures” and “Reconciliation of GAAP Net Loss to EBITDA and Adjusted EBITDA.”

 

The presentation of these non-GAAP financial measures is not intended to be considered in isolation from, as a substitute for, or superior to, the financial information prepared and presented in accordance with GAAP, and may be different from non-GAAP financial measures used by other companies. Chegg defines (1) Non-GAAP total pro forma net revenue as revenue as if it had already transitioned to a fully commission-based revenue model with Ingram for its print textbook business, (2) adjusted EBITDA as earnings before interest, taxes, depreciation and amortization, or EBITDA, adjusted for textbook depreciation and to exclude stock-based compensation expense, acquisition-related compensation costs, restructuring charges, transitional logistic charges and other income, net, (3) non-GAAP gross profit as gross profit excluding share-based compensation and transitional logistic charges, (4) non-GAAP gross margin is non-GAAP gross profit divided by GAAP total net revenue, (5) non-GAAP net loss as GAAP net loss excluding share-based compensation expense, amortization of intangible assets, acquisition related compensation costs, restructuring (credits) charges and transitional logistic charges and (6) non-GAAP net loss per share is defined as non-GAAP net loss divided by GAAP weighted-average shares outstanding. To the extent additional significant non-recurring items arise in the future, Chegg may consider whether to exclude such items in calculating the non-GAAP financial measures it uses.

Chegg believes that these non-GAAP financial measures, when taken together with the corresponding GAAP financial measures, provide meaningful supplemental information regarding Chegg’s performance by excluding items that may not be indicative of Chegg’s core business, operating results or future outlook. Chegg management uses these non-GAAP financial measures in assessing Chegg’s operating results, as well as when planning, forecasting and analyzing future periods and believes that such measures enhance investors’ overall understanding of our current financial performance. These non-GAAP financial measures also facilitate comparisons of Chegg’s performance to prior periods.

As presented in the “Reconciliation of GAAP Net Loss to EBITDA and Adjusted EBITDA” and “Reconciliation of GAAP to Non-GAAP Financial Measures” tables below, each of the non-GAAP financial measures excludes one or more of the following items:

Chegg is in the process of transitioning ownership of the print textbook library and print textbook logistics and fulfillment functions for its required materials business to Ingram. Upon completion of that transition, all revenue from its print textbook business will be digital revenue representing an approximately 20% commission from each such transaction. During the transition, Chegg reports print textbook revenue for orders that are fulfilled with textbooks owned by Chegg and commission-based revenue for orders that are fulfilled with textbooks owned by Ingram. Chegg expects the transition to a fully commission-based model with Ingram to be complete in 2017. The pro forma revenue adjustments present revenue “as if” Ingram already owned all textbooks and managed all logistics and order fulfillment. Management believes that presenting revenue as if Chegg had already fully transitioned to the commission-based model with Ingram provides investors with a better understanding of Chegg’s results of operations in light of the ongoing changes to its business model by facilitating period over period revenue comparisons during the transition period. The adjustments to GAAP revenue provided below reflect a number of estimates, assumptions and other uncertainties, and are approximate in nature.

Share-based compensation is a non-cash expense that varies in amount from period to period and is dependent on market forces that are often beyond Chegg's control. As a result, management excludes this item from Chegg's internal operating forecasts and models. Management believes that non-GAAP measures adjusted for share-based compensation provide investors with a basis to measure Chegg's core performance against the performance of other companies without the variability created by share-based compensation as a result of the variety of equity awards used by other companies and the varying methodologies and assumptions used.

Restructuring charges primarily relate to expenses incurred in making infrastructure-related changes as a result of transitioning Chegg’s fulfillment obligations for the print textbook business to Ingram, as well as expenses related to the exit of Chegg’s print coupon business. These restructuring charges are excluded from non-GAAP financial measures because they are the result of discrete events that are not considered core-operating activities. Chegg believes that it is appropriate to exclude restructuring charges from non-GAAP financial measures because it enables the comparison of period-over-period operating results from continuing operations.

Transitional logistic charges relate primarily to the expected closure of our warehouse and as we transition to Ingram’s distribution centers, which results in duplicative logistic charges. The duplicative logistic charges were expected to be incurred throughout 2015 until the transition of our logistics and fulfillment obligations for our print textbook business to Ingram were complete. Chegg believes that it is appropriate to exclude transitional logistic charges from non-GAAP financial measures because it enables the comparison of period-over-period operating results from continuing operations.

Acquisition-related compensations costs include: (1) compensation expense resulting from the employment retention of certain key employees established in accordance with the terms of the acquisitions, (2) the remaining pay-out related to the Bookstep acquisition and (3) adjustments to previously recognized earn-out liability on contingent compensation expense related to acquisitions. In most cases, these acquisition-related compensation costs are not factored into management's evaluation of potential acquisitions or Chegg's performance after completion of acquisitions, because they are not related to Chegg's core operating performance. In addition, the frequency and amount of such charges can vary significantly based on the size and timing of acquisitions and the maturities of the businesses being acquired. Excluding acquisition-related compensation costs from non-GAAP measures provides investors with a basis to compare Chegg’s results against those of other companies without the variability caused by purchase accounting.

Chegg amortizes intangible assets that it acquires in conjunction with business combinations, which results in non‑cash operating expenses that would not otherwise have been incurred had Chegg internally developed such intangible assets. Chegg believes excluding the accounting expense associated with acquired intangible asset from non-GAAP measures allows for a more accurate assessment of its ongoing operations.

Forward-Looking Statements

This press release contains forward-looking statements made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995, which include, without limitation those included in the investor presentation referenced above, and all statements about Chegg’s outlook under “Business Outlook.” The words “anticipate,” “believe,” “estimate,” “expect,” “intend,” “project,” “endeavor,” “will,” “should,” “future,” “transition,” “outlook” and similar expressions, as they relate to Chegg, are intended to identify forward-looking statements. These statements are not guarantees of future performance, and are based on management’s expectations as of the date of this press release and assumptions that are inherently subject to uncertainties, risks and changes in circumstances that are difficult to predict. Forward-looking statements involve known and unknown risks, uncertainties and other factors that may cause actual results, performance or achievements to differ materially from any future results, performance or achievements. Important factors that could cause actual results to differ materially from those expressed or implied by these forward-looking statements include the following: Chegg’s anticipated complete transition to a fully commission-based model with Ingram by 2017; the impact of Chegg’s acquisition of Imagine Easy Solutions and Chegg’s expectation that such acquisition will be accretive to Chegg's fiscal 2016 revenues and earnings and benefit students; Chegg’s ability to attract new students, increase engagement and increase monetization; competitive developments, including pricing pressures; Chegg’s anticipated growth of Chegg Services; Chegg’s ability to build and expand its services offerings; Chegg’s ability to develop new products and services on a cost-effective basis and to integrate acquired businesses and assets; the impact of seasonality on the business; Chegg’s partnership with Ingram and the parties’ ability to achieve the anticipated benefits of the partnership, including the potential impact of the economic risk-sharing arrangements between Chegg and Ingram on Chegg’s results of operations; Chegg’s ability to effectively control operating costs; changes in Chegg’s addressable market; changes in the education market; and general economic and industry conditions. All information provided in this release and in the conference call is as of the date hereof and Chegg undertakes no duty to update this information except as required by law. These and other important risk factors are described more fully in documents filed with the Securities and Exchange Commission, including Chegg’s Annual Report on Form 10-K filed with the Securities and Exchange Commission on March 4, 2016, and could cause actual results to vary from expectations.

* Derived from audited consolidated financial statements as of and for the year ended December 31, 2015.

        

INTEREST PURCHASE AGREEMENT    

by and among

CHEGG, INC.

a Delaware corporation,

IMAGINE EASY SOLUTIONS, LLC,

a Delaware limited liability company ,

AND

THE SELLERS

___________________________

Dated as of April 28, 2016

___________________________

        

TABLE OF CONTENTS

Exhibits

Exhibit A    -    Definitions

Exhibit B    -    Form of Non-Competition Agreement

Exhibit C    -    Form of Escrow Agreement

Exhibit D    -    Assignment of Interests

Exhibit E    -    Form of FIRPTA Certificate

Exhibit F-1    -    Form of Transaction Bonus Agreement (Till Klampaeckel)

Exhibit F-2    -    Form of Transaction Bonus Agreement (Emry Downinghall)

Exhibit G    -    Form of Release

Exhibit H    -    Form of Amended and Restated Company LLC Agreement

Exhibit I    -    Warranties relating to IES Tech

Exhibit J    -    2016 Plan Earnings Target Covenants

INTEREST PURCHASE AGREEMENT

This INTEREST PURCHASE AGREEMENT (this “ Agreement ”) is made and entered into as of April 28, 2016 (the “ Agreement Date ”), by and among Chegg, Inc., a Delaware corporation (“ Acquirer ”), Imagine Easy Solutions, LLC, a Delaware limited liability company (the “ Company ”), Neal Taparia and Darshan Somashekar (Darshan Somashekar together with Neal Taparia, the “ Sellers ”). Certain other capitalized terms used herein are defined in Exhibit A .

RECITALS

NOW, THEREFORE , in consideration of the representations, warranties, covenants, agreements and obligations contained herein, and for other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the parties hereto agree as follows:

Article I
THE PURCHASE

1.1      The Closing . Upon the terms and subject to the conditions set forth herein, the closing of the Transactions (the “ Closing ”) shall take place remotely via the exchange of final documents and signature pages (i) on a date and time to be agreed by Acquirer and the Company, which date shall be no later than three (3) Business Days following the date on which all of the conditions set forth in Article VII have been satisfied or waived (other than those conditions that, by their terms, are intended to be satisfied at the Closing, but subject to the satisfaction or waiver of those conditions), or (ii) such other time as Acquirer and the Company agree. The date on which the Closing occurs is sometimes referred to herein as the “ Closing Date .”

1.2      Closing Deliveries .

(a)      Acquirer Deliveries . Acquirer shall deliver to the Company, at or prior to the Closing:

(i)      a certificate, dated as of the Closing Date, executed on behalf of Acquirer by a duly authorized officer of Acquirer to the effect that each of the conditions set forth in Section 7.2(a) has been satisfied; and

(ii)      an escrow agreement executed by Acquirer and the Escrow Agent substantially in the form attached hereto as Exhibit C (the “ Escrow Agreement ”).

(b)      Sellers Deliveries . The Sellers shall deliver, or cause the Company to deliver, to Acquirer, at or prior to the Closing:

(i)      a certificate, dated as of the Closing Date and executed on behalf of the Company by its Managers, to the effect that each of the conditions set forth in Section 7.3(a)(i) and Section 7.3(e) has been satisfied;

(ii)      a certificate, dated as of the Closing Date and executed by the Sellers, to the effect that each of the conditions set forth in Section 7.3(a)(ii)  has been satisfied;

(iii)      a certificate, dated as of the Closing Date and executed on behalf of the Company by its Managers, certifying (A) the certificate of formation of the Company in effect as of the Closing, (B) the Company LLC Agreement in effect as of the Closing (collectively with the Company’s certificate of formation, the “ Organizational Documents ”), (C) resolutions of the Company’s Managers and its members approving the execution and delivery of this Agreement and the consummation of the Purchase, (D) the authority of the Managers of the Company executing this Agreement and any other document relating to the Purchase, (E) other matters reasonably requested by Acquirer, (F) that the Spreadsheet is true, correct and complete;

(iv)      assignment of the Interests and the Company LLC Agreement in the form attached hereto as Exhibit D (the “ Assignment of Interests ”), executed by each Seller;

(v)      written acknowledgments and invoices pursuant to which any Person that is entitled to any Transaction Expenses acknowledges (A) the total amount of Transaction Expenses that (1) has been incurred and paid to such Person prior to the Closing and (2) has been incurred and remains payable to such Person and (B) that, upon payment of such remaining payable amount at

the Closing, it shall be paid in full and shall not be owed any other amount by any of Acquirer, the Company and/or its Affiliates;

(vi)      evidence reasonably satisfactory to Acquirer of the resignation of each Manager of the Company in office immediately prior to the Closing as managers of the Company, effective as of, and contingent upon, the Closing;

(vii)      FIRPTA documentation, consisting of certificates of non-foreign status in accordance with the requirements of Treasury Regulation Section 1.1445-2(b)(2), in substantially the form attached hereto as Exhibit E , dated as of the Closing Date and executed by each of the Sellers;

(viii)      unless otherwise requested by Acquirer in writing no less than three (3) Business Days prior to the Closing Date, (A) a true, correct and complete copy of resolutions adopted by the Managers of the Company, authorizing the termination of each or all of the Company Employee Plans that are “employee benefit plans” within the meaning of ERISA, including the Company’s 401(k) Plan (the “ 401(k) Plan ”), and (B) an amendment to the 401(k) Plan, executed by the Company, that is sufficient to assure compliance with all applicable requirements of the Code and regulations thereunder so that the Tax-qualified status of the 401(k) Plan shall be maintained at the time of its termination, with such amendment and termination to be effective as of the date immediately preceding the Closing Date and contingent upon the Closing;

(ix)      a certificate from the Secretary of State of the State of Delaware and each other state or other jurisdiction in which the Company is qualified to do business as a foreign corporation, dated within three (3) Business Days prior to the Closing Date, certifying that the Company is in good standing and that all applicable Taxes and fees due and payable by the Company through and including the Closing Date have been paid;

(x)      evidence reasonably satisfactory to Acquirer of the termination or waiver of any rights of first refusal, rights to any liquidation preference, redemption rights, lock-ups, exit rights and rights of notice of the Sellers with respect to any of the Transactions, in all cases, effective as of, and contingent upon, the Closing;

(xi)      the Spreadsheet completed to include all of the information specified in Section 6.7 in a form reasonably satisfactory to Acquirer;

(xii)      the Company Closing Financial Certificate;

(xiii)      evidence reasonably satisfactory to Acquirer of (A) the Company’s receipt of all consents, waivers and approvals described in Schedule 1.2(b)(xiii)(A) , and (B) the Company’s termination notice with respect to each of the Contracts listed on Schedule 1.2(b)(xiii)(B) , as described therein;

(xiv)      payoff letters or similar instruments in form and substance reasonably satisfactory to Acquirer with respect to all Company Debt, which letters provide for the release of all Encumbrances relating to the Company Debt following satisfaction of the terms contained in such payoff letters (including any premiums above the principal amount of such Company Debt or any fees payable in connection with such Company Debt);

(xv)      the Escrow Agreement, executed by each Seller and the Escrow Agent;

(xvi)      waiver or release of any security interest held by any third party in any asset of the Company as of the Closing Date, executed by a duly authorized Person, whereby any such security interest is terminated, with evidence reasonably satisfactory to Acquirer that all Encumbrances on assets of the Company shall have been released prior to, or shall be released simultaneously with, the Closing;

(xvii)      executed confirmatory assignments of Intellectual Property from any of the Company’s current and former employees listed on Schedule 1.2(b)(xvii) , (including but not limited to the Sellers), consultants, advisors and independent contractors who have not executed assignments or similar agreements, in each case in a form that is reasonably satisfactory to Acquirer; and

(xviii)      the Transaction Bonus Agreement in substantially the form attached hereto as Exhibit F-1 , executed by Till Klampaeckel, and the Transaction Bonus Agreement in substantially the form attached hereto as Exhibit F-2 , executed by Emry Downinghall, each dated as of the Closing Date.

Receipt by Acquirer of any of the agreements, instruments, certificates or documents delivered pursuant to this Section 1.2(b) shall not be deemed to be an agreement by Acquirer that the information or statements contained therein are true, correct or complete, and shall not diminish Acquirer’s remedies hereunder if any of the foregoing agreements, instruments, certificates or documents are not true, correct or complete.

1.3      The Purchase .

(a)      Treatment of Interests . Upon the terms and subject to the conditions set forth herein, each Seller agrees to sell, transfer and deliver to Acquirer at the Closing, and Acquirer agrees to purchase from the Sellers, all right, title and interest in and to all of the Interest owned by such Sellers as of immediately prior to the Closing (as set forth on the Spreadsheet), free and clear of all Encumbrances other than Permitted Encumbrances, in exchange for the right to receive the following (subject to applicable withholding, payroll taxes and other legally required deductions) (the “ Purchase Consideration ”):

(xix)      Initial Cash Consideration . At Closing, for each Seller, an amount in cash, without interest, equal to such Seller’s Pro Rata Share of the Initial Cash Consideration (subject to Section 1.5 ).

(xx)      Deferred Cash Consideration . No later than April 15, 2017, for each Seller, an amount of cash, without interest, equal to such Seller’s Pro Rata Share of the Deferred Cash Consideration, after deducting any fees, costs, payments and expenditures payable to brokers, finders, financial advisors, investment bankers or similar Persons to the extent such amount becomes payable by the Sellers in connection with the Deferred Cash Consideration.

(xxi)      1st Additional Consideration Amount . If the Company reaches the 2016 Plan Earnings Target as determined pursuant to Schedule 1.3(a)(iii) , Acquirer shall pay to each Seller, an amount of cash or, at Acquirer’s sole discretion, a number of shares of Acquirer Stock (calculated pursuant to Acquirer Stock Price; provided that if Acquirer elects to pay the Sellers in Acquirer Stock, Acquirer shall notify the Sellers of such decision at least two (2) trading days before the applicable payment day), equal to such Seller’s Pro Rata Share of the 1st Additional Consideration Amount (after deducting any fees, costs, payments and expenditures payable to brokers, finders, financial advisors, investment bankers or similar Persons to the extent such amount becomes payable by the Sellers in connection with the 1st Additional Consideration Amount), without interest, divided

into installments and delivered on the dates specified according to the Additional Consideration Payment Schedule.

(xxii)      2nd Additional Consideration Amount . Acquirer shall pay to each Seller an amount of cash or, at Acquirer’s sole discretion, a number of shares of Acquirer Stock (calculated pursuant to Acquirer Stock Price; provided that if Acquirer elects to pay the Sellers in Acquirer Stock, Acquirer shall notify the Sellers of such decision at least (two) 2 trading days before the applicable payment day), equal to such Seller’s Pro Rata Share of the 2nd Additional Consideration Amount (after deducting any fees, costs, payments and expenditures payable to brokers, finders, financial advisors, investment bankers or similar Persons to the extent such amount becomes payable by the Sellers in connection with the 2nd Additional Consideration Amount), without interest, divided into installments and delivered on the dates specified according to the Additional Consideration Payment Schedule.

(xxiii)      Notwithstanding the foregoing, if a Seller’s employment is terminated by Acquirer without Cause or a Seller terminates his employment for Good Reason, then, the Applicable Percentage shall be thereafter calculated treating such Seller as having continued to provide services as an employee to Acquirer or its Affiliates from the Closing through the respective payment date specified in the Additional Consideration Payment Schedule and, with respect to each Seller, having achieved the earnout condition set forth in Section 1.3(a)(iii) ; provided, however, that such deemed continued employment treatment and waiver of the earnout condition set forth in Section 1.3(a)(iii) shall not apply if Seller fails to return the release substantially in the form attached hereto as Exhibit G on or before the Release Deadline (as defined below), or if Seller revokes the release. Seller must execute and return the release on or before the date specified by the Acquirer in the prescribed form (the “ Release Deadline ”). The Release Deadline will in no event be later than fifty-two (52) days after Seller’s Separation.

(b)      Treatment of Other Equity Interests . At Closing, each Equity Interest in the Company (other than the Interests) including Unvested Company Interests, warrants and any other rights to acquire units in the Company, that is outstanding immediately prior to the Closing shall be cancelled and extinguished without any consideration paid in respect thereof.

(c)      Adjustments . In the event of any split, reorganization, reclassification, combination, recapitalization or other like change with respect to the Interests occurring after the Agreement Date and prior to the Closing, all references herein to specified Interest shall be equitably adjusted to the extent necessary to provide the parties the same economic effect as contemplated by this Agreement prior to such split, reorganization, reclassification, combination, recapitalization or other like change.

(d)      Rights Not Transferable . The rights of the Sellers under this Agreement as of immediately prior to the Closing are personal to each such Seller and shall not be transferable for any reason, other than by operation of law, will or the laws of descent and distribution, in each case without consideration; provided that such transfer shall not affect any of the obligations of the Sellers hereunder. Any attempted transfer of such right by any holder thereof (other than as permitted by the immediately preceding sentence) shall be null and void.

(e)      No Interest . Notwithstanding anything to the contrary contained herein, no interest shall accumulate for the benefit of the Sellers on any cash payable in connection with the consummation of the Purchase and the other Transactions.

(f)      Company LLC Agreement . Immediately following the Closing, the Company LLC Agreement shall be amended and restated in its entirety to be in the form attached hereto as Exhibit H .

(g)      Total Stock Consideration . Notwithstanding anything to the contrary contained in this Agreement, in no event shall the aggregate number of shares of Acquirer Stock to be issued by Acquirer (i) to the Sellers under the terms of this Agreement equal or exceed either twenty percent (20%) of the number of outstanding shares of Acquirer Stock or twenty percent (20%) of the outstanding voting power of Acquirer as of immediately prior to the Closing or (ii) with respect to any Related Party (as defined in Section 312.03(b) of the New York Stock Exchange Listed Company Manual), exceed either one percent (1%) of the number of outstanding shares of Acquirer Stock or one percent (1%) of the outstanding voting power of Acquirer, in each case as of immediately prior to the Closing, it being the understanding of the parties that any consideration payable in excess of the foregoing limitations shall be paid to the applicable Seller in cash (in lieu of equity).

1.4      Payment Procedures .

(a)      Payments .

(i)      At Closing, each Seller shall be entitled to receive the amount of cash that Seller has the right to receive pursuant to Section 1.3(a)(i) , less (i) such Seller’s Pro Rata Share of the Escrow Amount (the “ Seller Escrow Amount ”), and (ii) such Seller’s Pro Rata Share of the Post-Closing Adjustment Holdback Amount (the “ Seller Post-Closing Adjustment Holdback Amount ”).

(ii)      As soon as reasonably practicable after the Closing Date, but in no event later than one (1) Business Day following the Closing Date, Acquirer will pay to each Seller by wire transfer of same-day funds the aggregate amount of cash payable to each Seller pursuant to Section 1.3(a)(i) , less (i) such Seller Escrow Amount, and (ii) such Seller Post-Closing Adjustment Holdback Amount.

(iii)      As soon as reasonably practicable after the Closing Date, but in no event later than two (2) Business Days following the Closing Date, Acquirer shall deposit with the Escrow Agent the Escrow Amount pursuant to the terms of this Agreement and the Escrow Agreement.

(b)      Escrow Amount . The Escrow Fund and the Post-Closing Adjustment Holdback Amount shall constitute partial security for the benefit of Acquirer (on behalf of itself or any other Indemnified Person) with respect to any Indemnifiable Damages pursuant to the indemnification obligations of the Sellers under Section 1.5(f) and Article IX , as well as the obligations under the Non-Competition Agreements, and shall be held and distributed in accordance with Section 9.1 . The adoption of this Agreement by the Sellers shall constitute, among other things, approval of the Escrow Amount, the Post-Closing Adjustment Holdback Amount and the withholding of the Escrow Amount and the Post-Closing Adjustment Holdback Amount.

(c)      Transfers of Ownership . If any cash amount payable pursuant to Section 1.3(a) is to be paid to a Person other than the Sellers, it shall be a condition of the payment thereof that such Interests shall be in proper form for transfer and that the Person requesting such payment shall have paid to Acquirer or any agent designated by Acquirer any transfer or other applicable Taxes, or established to the satisfaction of Acquirer or any agent designated by Acquirer that such Tax has been paid or is not payable.

(d)      No Liability . Notwithstanding anything to the contrary in this Section 1.4 , no party hereto shall be liable to any Person for any amount properly paid to a public official pursuant to any applicable abandoned property, escheat or similar Applicable Law.

1.5      Company Net Working Capital Adjustments .

(a)      Pursuant to Section 6.11 , the Company shall deliver the Company Closing Financial Certificate to Acquirer not later than three (3) days prior to the Closing Date, which shall include the Company’s good faith estimate, with reasonable supporting detail, of Company Net Working Capital in accordance with the Applicable Accounting Principles and consistent with the Sample Statement. An illustrative calculation of Company Net Working Capital as of March 31, 2016 is set forth in Schedule 1.5 (the “ Sample Statement ”).

(b)      Within ninety (90) days after the Closing, Acquirer shall deliver to the Sellers a notice (the “ Acquirer NWC Notice ”) setting forth Acquirer’s calculation of Company Net Working Capital (the “ NWC Calculations ”) and the amount by which Company Net Working Capital, as calculated by Acquirer is less or more than Company Net Working Capital as set forth in the Company Closing Financial Certificate, in each case together with supporting documentation, information and calculations. The NWC Calculations shall be prepared in accordance with the Applicable Accounting Principles and consistent with the Sample Statement and shall not include changes in assets or liabilities as a result of purchase accounting adjustments in connection with the Purchase.

(c)      The Sellers may object to the calculation of Company Net Working Capital set forth in the Acquirer NWC Notice by providing written notice of such objection to Acquirer within thirty (30) days after Acquirer’s delivery of the Acquirer NWC Notice (the “ Notice of Objection ”), together with supporting documentation, information and calculations. Any matters not expressly set forth in the Notice of Objection shall be deemed to have been accepted by the Sellers.

(d)      If the Sellers timely provide the Notice of Objection, then Acquirer and the Sellers shall confer in good faith for a period of up to ten (10) Business Days following Acquirer’s timely receipt of the Notice of Objection in an attempt to resolve any disputed matter set forth in the Notice of Objection, and any resolution by them shall be in writing and shall be final and binding on the parties hereto. If the Sellers do not timely provide the Notice of Objection to Acquiror, then the calculations specified in the Acquirer NWC Notice shall be conclusively presumed to be true and correct in all respects and shall be final and binding upon the parties.

(e)      If, after the ten (10) Business Day period set forth in Section 1.5(d) , Acquirer and the Sellers cannot resolve any matter set forth in the Notice of Objection, then Acquirer shall refer such unresolved matters to an independent registered public accounting firm mutually agreed upon by Acquirer and the Sellers (the “ Reviewing Accountant ”), to review only the matters in the Notice of Objection that are still disputed by Acquirer and the Sellers and the NWC Calculations to the extent relevant thereto. After such review and a review of the Company’s relevant books and records, the Reviewing Accountant shall promptly (and in any event within sixty (60) days following its engagement) determine the resolution of such remaining disputed matters, which determination shall be final and binding on the parties hereto, and the Reviewing Accountant shall provide Acquirer and the Sellers with a calculation of Company Net Working Capital in accordance with such determination. The Reviewing Accountants shall resolve the matter in accordance with the terms and provisions of this Agreement and shall only conduct an independent review of the matters that are still disputed by Acquirer and Sellers. The Reviewing Accountant shall act as an expert (and not as an arbitrator) in making its determination which shall, in the absence of manifest error, be final and binding on the parties to this Agreement and, without prejudice to any other rights which they may respectively have under this Agreement, the parties to this Agreement expressly waive, to the extent permitted by Applicable Law, any rights of recourse they may otherwise have to challenge it.

(f)      If the Company Net Working Capital as finally determined pursuant to Section 1.5(b) , Section 1.5(d) and/or Section 1.5(e) , as the case may be (the “ Final Net Working Capital ”), is less than the Company Net Working Capital, as set forth in the Company Closing Financial Certificate (such difference, the “ Final Net Working Capital Shortfall ”), then the Sellers shall indemnify and hold harmless Acquirer (other than with respect to interest and internal fees, costs or expenses of Acquirer or the Company), according to their respective Pro Rata Share, and Acquirer shall have the right to retain from the Post-Closing Adjustment Holdback Amount, an amount of cash having a total value equal to the full amount of:

(i)      the Final Net Working Capital Shortfall; and

(ii)      all fees, costs and expenses of the Reviewing Accountant to be paid by the Sellers pursuant to Section 1.5(h) , if any.

(g)      If the Final Net Working Capital is more than the Company Net Working Capital, as set forth in the Company Closing Financial Certificate (such difference, the “ Final Net Working Capital Excess ”), then Acquirer shall, within five (5) Business Days, pay to each Seller his or her Pro Rata Share of an amount equal to:

(i)      the Final Net Working Capital Excess; and

(ii)      all fees, costs and expenses of the Reviewing Accountant to be paid by Acquirer pursuant to Section 1.5(h) , if any.

(h)      The fees of the Reviewing Accountant shall be allocated and borne by Acquirer, on the one hand, and the Sellers, on the other hand, based on the inverse of the percentage that the Reviewing Accountant’s determination (before such allocation) bears to the total amount of the total items in dispute as originally submitted to the Reviewing Accountant (i.e., if the items in dispute total in amount one thousand dollars ($1,000) and the Reviewing Accountant awards six hundred dollars ($600) in favor of Acquirer’s position, then sixty percent (60%) of the fees of the Reviewing Accountant shall be borne by the Sellers in accordance with their Pro Rata Shares and forty percent (40%) by Acquirer); provided, however, that if the difference between the Final Net Working Capital as determined by the Reviewing Accountant pursuant to Section 1.5(e) and the NWC Calculations set forth in the Acquirer NWC Notice is less than 10%, the fees of the Reviewing Accountant shall be entirely borne by the Sellers.

1.6      Tax Consequences . The parties hereto acknowledge that the Purchase is intended to be a taxable purchase of units for U.S. income tax purposes. For U.S. federal income tax purposes, Acquirer, the Company and the Sellers agree that the Purchase will effect a transaction described in IRS Revenue Ruling 99-6, Situation No. 2 and will file all Tax Returns consistent with that treatment. The parties intend and agree that the payments of the Additional Consideration to the Sellers in exchange for Interests that were vested at grant or for which a Section 83(b) election has been properly made will be treated and reported for income Tax purposes as payment in consideration for such Interests exchanged therefor and not as compensation income, except as otherwise required by a Tax authority on audit or other examination after such Tax reporting. Notwithstanding the foregoing, Acquirer makes no representations or warranties to the Company or to the Sellers regarding the Tax treatment of the Purchase, or any of the Tax consequences to the Company or the Sellers of this Agreement, the Purchase or the other Transactions or the other agreements contemplated by this Agreement. The Company acknowledges that the Company and the Sellers are relying solely on their own Tax advisors in connection with this Agreement, the Purchase and the other Transactions and the other agreements contemplated by this Agreement.

1.7      Certain Taxes . All transfer, documentary, sales, use, stamp, registration and other Taxes and fees (including any penalties and interest) incurred in connection with this Agreement shall be paid one-half by the Sellers (in accordance with their Pro Rata Shares) and one-half by the Acquirer when due, and the Sellers shall, at their own expense, file all necessary Tax Returns and other documentation with respect to all such transfer, documentary, sales, use, stamp, registration and other Taxes and fees.

1.8      Withholding Rights . Each of Acquirer and the Company shall be entitled to deduct and withhold from any payments of cash or stock pursuant to this Agreement to the Sellers, such amounts in cash and/or stock as Acquirer or the Company is required to deduct and withhold with respect to any such payments under the Code or any provision of state, local, provincial or foreign Tax law. To the extent that amounts are so withheld and paid over to the appropriate Tax authority, such withheld amounts shall be treated for all purposes of this Agreement as having been paid to such Persons in respect of which such deduction and withholding was made.

1.9      Taking of Necessary Action; Further Action . If, at any time after the Closing, any further action is necessary or desirable to carry out the purposes of this Agreement and to vest the Company with full right, title and interest in, to and under, and/or possession of, all assets, property, rights, privileges, powers and franchises of the Company, the officers of the Company are fully authorized, in the name and on behalf of the Company or otherwise, to take all lawful action necessary or desirable to accomplish such purpose or acts, so long as such action is not inconsistent with this Agreement.

1.10      Acquirer Stock Certificates . Any certificates evidencing the shares of Acquirer Stock to be issued pursuant to Section 1.3(a)(iii) and (iv) , if any, shall bear the following legends (along with any other legends that may be required under Applicable Law):

“(1) THE SECURITIES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE “ACT”), OR UNDER THE SECURITIES LAWS OF ANY OTHER JURISDICTIONS. THESE SECURITIES ARE SUBJECT TO RESTRICTIONS ON TRANSFERABILITY AND RESALE AND MAY NOT BE TRANSFERRED OR RESOLD EXCEPT AS PERMITTED UNDER THE ACT AND THE APPLICABLE STATE SECURITIES LAWS, PURSUANT TO REGISTRATION OR EXEMPTION THEREFROM. INVESTORS SHOULD BE AWARE THAT THEY MAY BE REQUIRED TO BEAR THE FINANCIAL RISKS OF THIS INVESTMENT FOR AN INDEFINITE PERIOD OF TIME. THE ISSUER OF THESE SECURITIES MAY REQUIRE AN OPINION OF COUNSEL IN FORM AND SUBSTANCE SATISFACTORY TO THE ISSUER TO THE EFFECT THAT ANY PROPOSED TRANSFER OR RESALE IS IN COMPLIANCE WITH THE ACT AND ANY APPLICABLE STATE SECURITIES LAWS.

(2) THE SHARES EVIDENCED HEREBY ARE SUBJECT TO CERTAIN INDEMNITY AND ESCROW OBLIGATIONS AS SET FORTH IN AN AGREEMENT WITH THE COMPANY.”

ARTICLE II     
REPRESENTATIONS AND WARRANTIES OF THE COMPANY

Subject to the disclosures set forth in the disclosure letter of the Company delivered to Acquirer concurrently with the execution of this Agreement (the “ Company Disclosure Letter ”) (each of which disclosures, in order to be effective, shall clearly indicate the Section and, if applicable, the Subsection of this Article II to which it relates (unless and only to the extent the relevance to other representations and warranties is readily apparent from the actual text of the disclosures without any reference to extrinsic documentation or any independent knowledge on the part of the reader regarding the matter disclosed), and each of which disclosures shall also be deemed to be representations and warranties made by the Company to Acquirer under this Article II ), the Company represents and warrants to Acquirer as follows:

2.1      Organization, Standing, Power and Subsidiaries .

(c)      The Company is a limited liability company duly organized, validly existing and in good standing under the laws of the State of Delaware. The Company has the limited liability company power to own, operate, use, distribute and lease its properties and to conduct the Business and is duly licensed or qualified to do business and is in good standing in each jurisdiction where the failure to be so licensed, qualified or in good standing, individually or in the aggregate with any such other failures, would reasonably be expected to have a Material Adverse Effect with respect to the Company. Except as set forth in Schedule 2.1(a) of the Company Disclosure Letter, the Company has and, since its inception has had, no Subsidiaries or any Equity Interest, whether direct or indirect, in, any corporation, partnership, limited liability company, joint venture or other business entity.

(d)      Schedule 2.1(b) of the Company Disclosure Letter sets forth a true, correct and complete list of the names of the Company managers (the “ Managers ”).

2.2      Capital Structure .

(h)      Schedule 2.2(a) of the Company Disclosure Letter sets forth a true, correct and complete list of the beneficial and record owners of any Interest and the respective percentage of Interests in the Company held by such Persons. Each Interest was issued in compliance with Applicable Law, the Organizational Documents and any applicable Contracts to which the Company is a party or by which the Company or any of its assets is bound and are free of any Encumbrances (other than Permitted Encumbrances), outstanding subscriptions, preemptive rights or “put” or “call” rights created by statute, the Organizational Documents or any Contract to which the Company is a party or by which the Company or any of its assets is bound. The Company is not under any obligation to register under the Securities Act or any other Applicable Law any Interest, any Equity Interests in or any other securities of the Company, whether currently outstanding or that may subsequently be issued. The Sellers are the sole parties to the Company LLC Agreement and, collectively, the legal and beneficial owners of 100% of the Interests.

(i)      Except as set forth in Schedule 2.2(b) of the Company Disclosure Letter the Company has never granted, or entered into any offer letter or other Contract or Company Employee Plan that contemplates a grant of, or right to purchase or receive, Company Options, Unvested Company Interests or warrants and no Company Options or warrants have ever been outstanding.

(j)      There are no authorized, issued or outstanding Equity Interests in the Company other than Interest allocated as set forth on Schedule 2.2(a) . Other than as set forth on Schedules 2.2(a) 2.2(b) and 2.2(c) of the Company Disclosure Letter, as of the Agreement Date, no Person other than the Sellers has or has had any Equity Interests in the Company, share schemes, call or put rights, or is party to any Contract (other than this Agreement) of any character to which the Company or a Seller is a party or by which it or its assets is bound, (i) obligating the Company or such Seller to issue, deliver, sell, repurchase or redeem, or cause to be issued, delivered, sold, repurchased or redeemed, any Equity Interests in the

Company or other rights to purchase or otherwise acquire any Equity Interests in the Company, whether vested or unvested, (ii) obligating the Company to grant, extend, accelerate the vesting and/or repurchase rights of, change the price of, or otherwise amend or enter into any such call, right or Contract or (iii) obligating the Company or the Sellers to make any payment to related to the value or change in value of the Company Interest (or any other Equity Interests in the Company).

(k)      No Company Debt (i) granting the holder thereof the right to vote on any matters on which the Sellers may vote (or that is convertible into, or exchangeable for, securities having such right) or (ii) the value of which is in any way based upon or derived from capital or voting unit of the Company, is issued or outstanding as of the Agreement Date (collectively, “ Company Voting Debt ”).

(l)      Other than as set forth in Schedule 2.2(e) of the Company Disclosure Letter, there are no Contracts relating to voting, purchase, acceleration, sale, grant or transfer of any Interest between the Company and the Sellers, and no Interest in the Company are or ever have been subject to vesting of any kind or in any form.

(m)      As of the Closing, (i) the Interests set forth in the Spreadsheet as being owned by a Seller constitutes the entire interest of such Seller in any Interest or any other Equity Interests in the Company, (ii) other than the Identified Individuals, no Person not disclosed in the Spreadsheet will have a right to acquire from the Company any Interests or any other Equity Interests in the Company and (iii) the Interests disclosed in the Spreadsheet will be free and clear of any Encumbrances other than Permitted Encumbrances. Each Seller’s Interest is evidenced solely by the Company LLC Agreement.

2.3      Authority; Non-contravention .

(e)      Subject to the execution of this Agreement by the Sellers, the Company has and shall have all requisite limited liability company power and authority to enter into this Agreement and the other Company Transaction Documents and to consummate the Transactions. The execution and delivery of this Agreement and the other Company Transaction Documents and the consummation of the Transactions have been duly authorized by all necessary limited liability company action on the part of the Company. Each Company Transaction Document has been or, if applicable, will be at Closing duly executed and delivered by the Company and, assuming the due execution and delivery of such Company Transaction Document by the other parties hereto, constitutes the valid and binding obligation of the Company enforceable against the Company in accordance with its terms subject only to the effect, if any, of (i) applicable bankruptcy and other similar Applicable Law affecting the rights of creditors generally and (ii) rules of law governing specific performance, injunctive relief and other equitable remedies (the “ Enforceability Exceptions ”). The Company’s Managers, by resolutions duly adopted (and not thereafter modified or rescinded) by unanimous vote have approved and adopted this Agreement and the Company Transaction Documents and approved the Purchase and the Transactions, determined that the Company Transaction Documents and the terms and conditions of the Purchase and the Company Transaction Documents are advisable and in the best interests of the Company.

(f)      Other than as set forth in Schedule 2.3(b) of the Company Disclosure Letter, the execution and delivery of the Company Transaction Documents by the Company do not, and the consummation of the Transactions will not, (i) result in the creation of any Encumbrance (other than Permitted Encumbrances) on any of the material assets of the Company or any of the Interest or (ii) conflict in any respect with, or result in any violation of or default under (with or without notice or lapse of time, or both), or give rise to a right of termination, cancellation or acceleration of any obligation or loss of any benefit under, or require any consent, approval or waiver from any Person pursuant to, (A) any provision of the

Organizational Documents or (B) any Applicable Law. Other than as set forth in Schedule 2.3(b) of the Company Disclosure Letter, the execution and delivery of the Company Transaction Documents by the Company do not, and the consummation of the Transactions will not, (i) result in the creation of any Encumbrance (other than Permitted Encumbrances) on any of the material assets of the Company or any of the Interest or (ii) conflict in any material respect with, or result in any material violation of or material default under (with or without notice or lapse of time, or both), or give rise to a right of termination, cancellation or acceleration of any obligation or loss of any benefit under, or require any consent, approval or waiver from any Person pursuant to any Contract of the Company.

(g)      No consent, approval, Order or authorization of, or registration, declaration or filing with, or notice to, any Governmental Entity or any other Person is required by or with respect to the Company in connection with the execution and delivery of this Agreement or any other Company Transaction Document or the consummation of the Transactions, except for such other consents, approvals, Orders, authorizations, registrations, declarations, filings and notices that, if not obtained or made, would not adversely affect, and would not reasonably be expected to adversely affect, the Company’s ability to perform or comply with the covenants, agreements or obligations of the Company in any Company Transaction Document or to consummate the Transactions in accordance with any Company Transaction Document and Applicable Law.

(h)      The Company and the Sellers have taken all actions such that the restrictive provisions of any “fair price,” “moratorium,” “control share acquisition,” “business combination,” or other similar anti-takeover statute or regulation, and any anti-takeover provision in the Organizational Documents will not be applicable to any of Acquirer, the Purchase or the Company, or to the execution, delivery or performance of this Agreement.

2.4      Financial Statements; No Undisclosed Liabilities; Absence of Changes .

(i)      The Company has made available to Acquirer its financial statements for the fiscal year ending December 31, 2015 reviewed by an independent accounting firm in accordance with Statement on Financial Accounting Standard No. 100 and financial statements for the three (3) month period ended March 31, 2016 (including, in each case, balance sheets, statements of operations and statements of cash flows) reviewed by an independent accounting firm in accordance with Statement on Financial Accounting Standard No. 100 (collectively, the “ Financial Statements ”), which are included as Schedule 2.4(a) of the Company Disclosure Letter. The Financial Statements (i) are derived from and in accordance with the books and records of the Company, (ii) fairly and accurately present the financial condition of the Company at the dates therein indicated and the consolidated results of operations and cash flows of the Company for the periods therein specified (subject, in the case of unaudited financial statements, to normal recurring audit adjustments, none of which individually or in the aggregate are or will be material in amount), (iii) are true, correct and complete and (iv) were prepared in accordance with GAAP, except for the absence of footnotes in the unaudited Financial Statements, applied on a consistent basis throughout the periods involved.

(j)      The Company has no Liabilities of any nature other than (i) those set forth or adequately provided for in the balance sheet included in the Financial Statements (the “ Company Balance Sheet ”) as of March 31, 2016 (the “ Company Balance Sheet Date ”), (ii) not required to be reflected in the Company Balance Sheet under GAAP, other than any such Liability which the Company considered including in the Company Balance Sheet but made a determination that such Liability was either not probable (as defined in the Statement of Financial Accounting Standards No. 5 (“ FAS 5 ”) or the amount of the loss related thereto cannot be reasonably estimated (within the meaning of FAS 5), all of which are set forth in Schedule 2.4(b) of the Company Disclosure Letter, (iii) those incurred in the conduct of the Company’s business since the Company Balance Sheet Date in the ordinary course of business consistent with past practice and do not

result from any breach of Contract, warranty, infringement, tort or violation of Applicable Law and (iv) those incurred by the Company in connection with the execution and performance of this Agreement. Except for Liabilities reflected in the Financial Statements, the Company has no off-balance sheet Liability of any nature to, or any financial interest in, any third parties or entities, the purpose or effect of which is to defer, postpone, reduce or otherwise avoid or adjust the recording of expenses incurred by the Company. All reserves that are set forth in or reflected in the Company Balance Sheet have been established in accordance with GAAP consistently applied. The Financial Statements comply in all material respects with the Financial Accounting Standards Board Accounting Standards Codification 605. Without limiting the generality of the foregoing, the Company has never guaranteed any debt or other obligation of any other Person.

(k)      Schedule 2.4(c) of the Company Disclosure Letter sets forth a true, correct and complete list of all Company Debt, including, for each item of Company Debt, the agreement governing the Company Debt and the interest rate, maturity date, any assets securing such Company Debt and any prepayment or other penalties payable in connection with the repayment of such Company Debt at the Closing.

(l)      Schedule 2.4(d) of the Company Disclosure Letter sets forth the names and locations of all banks and other financial institutions at which the Company maintains accounts and the names of all Persons authorized to make withdrawals therefrom.

(m)      The accounts receivable of the Company (the “ Accounts Receivable ”) as reflected on the Company Balance Sheet and as will be reflected in the Company Closing Financial Certificate arose or shall arise in the ordinary course of business consistent with past practice and represent or shall represent bona fide claims against debtors for sales and other charges, and have been collected or are collectible in the book amounts thereof within sixty (60) days following the Agreement Date, less an amount not in excess of the applicable allowance for doubtful accounts provided for in the Company Balance Sheet or in the Company Closing Financial Certificate, as the case may be. Allowances for doubtful accounts and warranty returns have been prepared in accordance with GAAP consistently applied and in accordance with the Company’s past practice and are sufficient to provide for any losses that may be sustained on realization of the applicable Accounts Receivable. The Accounts Receivable arising after the Company Balance Sheet Date and before the Closing Date (i) arose or shall arise in the ordinary course of business consistent with past practice, (ii) represented or shall represent bona fide claims against debtors for sales and other charges and (iii) have been collected or are collectible in the book amounts thereof within sixty (60) days following the Agreement Date, less allowances for doubtful accounts and warranty returns determined in accordance with GAAP consistently applied and the Company’s past practice that are or shall be sufficient to provide for any losses that may be sustained on realization of the applicable Accounts Receivable. None of the Accounts Receivable is subject to any claim of offset, recoupment, set-off or counter-claim and, to the knowledge of the Company, there are no facts or circumstances (whether asserted or unasserted) that could give rise to any such claim. No material amount of Accounts Receivable is contingent upon the performance by the Company of any obligation or Contract other than normal warranty repair and replacement. No Person has any Encumbrance on any Accounts Receivable, and no agreement for deduction or discount has been made with respect to any such Accounts Receivable. Schedule 2.4(e) of the Company Disclosure Letter sets forth, as of the Agreement Date, an aging of the Accounts Receivable in the aggregate and by customer, and indicates the amounts of allowances for doubtful accounts and warranty returns. Schedule 2.4(e) of the Company Disclosure Letter sets forth, as of the Agreement Date, such amounts of Accounts Receivable that are subject to asserted warranty claims by customers and reasonably detailed information regarding asserted warranty claims made within the last year, including the type and amounts of such claims.

(n)      The Company has established and maintains a system of internal accounting controls sufficient to provide reasonable assurances (i) that transactions, receipts and expenditures of the Company are being executed and made only in accordance with appropriate authorizations of management and the Company’s Managers, (ii) that transactions are recorded as necessary (A) to permit preparation of financial statements in conformity with GAAP and (B) to maintain accountability for assets, (iii) regarding prevention or timely detection of unauthorized acquisition, use or disposition of the assets of Company and (iv) that the amount recorded for assets on the books and records of the Company is compared with the existing assets at reasonable intervals and appropriate action is taken with respect to any differences. None of the Company, the Company’s independent auditors and, to the knowledge of the Company, any current or former employee, consultant, advisor, independent contractor or officer of the Company, has identified or been made aware of any fraud, whether or not material, that involves Company’s management or other current or former employees, consultants, advisors, independent contractors or directors of Company who have a role in the preparation of financial statements or the internal accounting controls utilized by the Company, or any claim or allegation regarding any of the foregoing. None of the Company and, to the knowledge of the Company, any Representative of the Company has received or otherwise had or obtained knowledge of any material complaint, allegation, assertion or claim, whether written or oral, in each case, regarding deficient accounting or auditing practices, procedures, methodologies or methods of the Company or its internal accounting controls or any material inaccuracy in the Company’s financial statements. No attorney representing the Company, whether or not employed by the Company, has reported to the Company’s Managers or to any committee of the Company evidence of a material violation of securities laws, breach of fiduciary duty or similar violation by the Company or its Representatives. There are no significant deficiencies or material weaknesses in the design or operation of the Company’s internal controls that could adversely affect the Company’s ability to record, process, summarize and report financial data. At the Company Balance Sheet Date, there were no material loss contingencies (as such term is used in Financial Accounting Standards Board Accounting Standards Codification Topic 450) that are not adequately provided for in the Company Balance Sheet as required by such Topic 450. There has been no change in the Company accounting policies since the Company’s inception, except as described in the Financial Statements.

(o)      Other than as set forth in Schedule 2.4(g) of the Company Disclosure Letter, since the Company Balance Sheet Date, (i) the Company has conducted the Business only in the ordinary course of business consistent with past practice, (ii) there has not occurred a Material Adverse Effect with respect to the Company and (iii) the Company has not done, caused or permitted any action that would constitute a breach of Section 5.2 if such action were taken by the Company, without the written consent of Acquirer during the Pre-Closing Period.

2.5      Litigation . There is and has been no Legal Proceeding to which the Company is a party pending before any Governmental Entity or, to the knowledge of the Company, threatened against the Company or any of its assets. There is no Legal Proceeding pending or, to the knowledge of the Company, threatened against any of the Company’s managers, members or employees (in their capacities as such or relating to their employment, services or relationship with the Company), and, to the knowledge of the Company, there is not any reasonable basis for any such Legal Proceeding. There is no Order against the Company, any of its assets, or, to the knowledge of the Company, any of its managers or employees (in their capacities as such or relating to their employment, services or relationship with the Company). To the knowledge of the Company, there is no reasonable basis for any Person to assert a claim against the Company or any of its assets or any of its managers, members or employees (in their capacities as such or relating to their employment, services or relationship with the Company) based upon: (i) the Company entering into this Agreement, any of the Transactions or the agreements contemplated by this Agreement, including a claim that such manager or employee breached a fiduciary duty in connection therewith, (ii) any confidentiality or similar agreement entered into by the Company regarding its assets or (iii) any claim that

the Company has agreed to sell or dispose of any of its assets to any party other than Acquirer, whether by way of merger, consolidation, sale of assets or otherwise. The Company does not have any Legal Proceeding (pending or threatened) against any other Person.

2.6      Restrictions on Business Activities . Other than as set forth in Schedule 2.6 of the Company Disclosure Letter, there is no Contract or Order binding upon the Company that restricts or prohibits, purports to restrict or prohibit, has or would reasonably be expected to have, whether before or after consummation of the Purchase, the effect of prohibiting or materially restricting, limiting or impairing any current or presently proposed business practice of the Company, any acquisition of property by the Company or the conduct or operation of the Business or, excluding restrictions on the use of Third-Party Intellectual Property contained in the applicable written license agreement therefor, limiting the freedom of the Company to (i) engage or participate, or compete with any other Person, in any line of business, market or geographic area with respect to the Company Products or the Company Intellectual Property, or to make use of any Company Intellectual Property, including any grants by the Company of exclusive rights or licenses or (ii) sell, distribute or manufacture any products or services or to purchase or otherwise obtain any software, components, parts or services.

2.7      Compliance with Laws; Governmental Permits .

(a)      The Company has complied in all material respects with, is not in violation in any material respect of, and has not received any written or, to the Company’s knowledge, oral notices of violation with respect to, Applicable Law.

(b)      The Company has obtained each material national, federal, state, county, local or foreign governmental consent, license, permit, grant or other authorization of a Governmental Entity (i) pursuant to which the Company currently operates or holds any interest in any of its assets or properties or (ii) that is required for the conduct of the Business or the holding of any such interest (all of the foregoing consents, licenses, permits, grants and other authorizations, collectively, the “ Company Authorizations ”), and all of the Company Authorizations are in full force and effect. The Company has not received any written or, to the Company’s knowledge, oral notice or other communication from any Governmental Entity regarding (i) any actual or, to the Company’s knowledge, threatened violation of any Company Authorization or (ii) any actual or threatened revocation, withdrawal, suspension, cancellation, termination or modification of any Company Authorization, and to the knowledge of the Company, no such notice or other communication is forthcoming. The Company has materially complied with all of the terms of the Company Authorizations and none of the Company Authorizations will be terminated or impaired, or will become terminable, in whole or in part, as a result of the consummation of the Transactions.

(c)      The Company is not, and is not required to be registered as, an “investment company” under the Investment Company Act of 1940, as amended.

2.8      Title to, Condition and Sufficiency of Assets .

(a)      The Company has good title to, or valid leasehold interest (including any licenses) in all of its properties, and interests in properties and assets, real and personal, whether reflected on the Company Balance Sheet or not or acquired after the Company Balance Sheet Date (except properties and assets, or interests in properties and assets, sold or otherwise disposed of since the Company Balance Sheet Date in the ordinary course of business consistent with past practice), or, with respect to leased or licensed properties and assets, valid leasehold or licensed interests in such properties and assets that afford the Company valid possession and use of the properties and assets that are the subject of such leases, in each case, free and clear of all Encumbrances, except Permitted Encumbrances. Schedule 2.8(a) of the Company

Disclosure Letter identifies each parcel of real property leased or other property licensed by the Company. The Company has provided to Acquirer true, correct and complete copies of all leases, subleases, licenses and other agreements under which the Company uses or occupies or has the right to use or occupy, now or in the future, any property or real property or facility, including all modifications, amendments and supplements thereto. The Company does not currently own any real property.

(b)      The assets and properties owned by the Company (i) constitute all of the assets and properties that are necessary for the Company to conduct, operate the Business and to sell and otherwise enjoy full rights to exploitation of its assets, properties and all products and services that are provided in connection with its assets and properties and (ii) constitute all of the assets and properties that are used in the conduct of the Business, without (A) the need for Acquirer to acquire or license any other asset, property or Intellectual Property or (B) the breach or violation of any Contract.

2.9      Intellectual Property .

(a)      As used herein, the following terms have the meanings indicated below. In addition, for clarity, the Sellers are considered a third party for purposes of the definitions, representations and warranties in this Section 2.9 :

(iii)      “ Company Data ” means all data collected, generated, or received in connection with the marketing, delivery, or use of any Company Product, including Company-Licensed Data, Company-Owned Data and Personal Data.

(iv)      “ Company Data Agreement ” means any Contract involving Company Data to which the Company is a party or is bound, except for the standard terms of service entered into by users of the Company Products (copies of which have been provided to Acquirer).

(v)      “ Company Intellectual Property ” means any and all Company-Owned Intellectual Property and any and all Third-Party Intellectual Property that is licensed to the Company.

(vi)      “ Company Intellectual Property Agreements ” means any Contract governing any Company Intellectual Property to which the Company is a party or bound, except for Contracts for Third-Party Intellectual Property that is generally, commercially available software and (A) has not been customized for the Company, and (B) has an individual acquisition cost of $5,000 in the aggregate.

(vii)      “ Company-Owned Intellectual Property ” means any and all Intellectual Property that is owned or purported to be owned by the Company, and all Intellectual Property to which the Company has or purports to have an exclusive license.

(viii)      “ Company Privacy Policies ” means, collectively, any and all (A) of the Company’s data privacy and security policies, whether applicable internally, or published on Company Websites or otherwise made available by the Company to any Person and (B) public representations by the Company regarding its privacy practices (including representations on Company Websites).

(ix)      “ Company Products ” means all products or services produced, marketed, licensed, sold, distributed or performed by or on behalf of the Company and all products or services currently under development by the Company according to the Company Product Roadmap.

(x)      “ Company Registered Intellectual Property ” means the United States, international and foreign: (A) patents and patent applications (including provisional applications), (B) registered trademarks, applications to register trademarks, intent-to-use applications, or other registrations or applications related to trademarks, (C) registered Internet domain names and (D) registered copyrights and applications for copyright registration, in each case registered or filed in the name of, or owned by, the Company.

(xi)      “ Company Source Code ” means, collectively, any software source code or database specifications or designs, or any material proprietary information or algorithm contained in or relating to any software source code or database specifications or designs, of any Company-Owned Intellectual Property or Company Products.

(xii)      “ Company Websites ” means all web sites owned, operated or hosted by the Company or through which the Company conducts the Business (including those web sites operated using the domain names listed in Schedule 2.9(c) of the Company Disclosure Letter), and the underlying platforms for such web sites.

(xiii)      “ Intellectual Property ” means (A) Intellectual Property Rights and (B) Proprietary Information and Technology.

(xiv)      “ Intellectual Property Rights ” means any and all of the following and all rights in, arising out of, or associated therewith, throughout the world: patents, utility models, and applications therefor and all reissues, divisions, re-examinations, renewals, extensions, provisionals, continuations and continuations-in-part thereof and equivalent or similar rights in inventions and discoveries anywhere in the world, including invention disclosures; common law and statutory rights associated with trade secrets, confidential and proprietary information and know-how; industrial designs and any registrations and applications therefor; trade names, logos, trade dress, trademarks and service marks, trademark and service mark registrations, trademark and service mark applications and any and all goodwill associated with and symbolized by the foregoing items; Internet domain name applications and registrations, Internet and World Wide Web URLs or addresses; copyrights, copyright registrations and applications therefor and all other rights corresponding thereto; database rights; mask works, mask work registrations and applications therefor and any equivalent or similar rights in semiconductor masks, layouts, architectures or topology; moral and economic rights of authors and inventors, however denominated; and any similar or equivalent rights to any of the foregoing.

(xv)      “ Open Source Materials ” means software or other material that is distributed as “free software,” “open source software” or under similar licensing or distribution terms (including the GNU General Public License (GPL), GNU Lesser General Public License (LGPL), Mozilla Public License (MPL), BSD licenses, the Artistic License, the Netscape Public License, the Sun Community Source License (SCSL) the Sun Industry Standards License (SISL) and the Apache License).

(xvi)      “ Personal Data ” means any piece of information that allows the identification of a natural Person (including a customer or an employee) or data that is otherwise considered personally identifiable information or personal data under Applicable Law.

(xvii)      “ Privacy Laws ” means (A) each Applicable Law applicable to the protection or Processing or both of Personal Data, and includes rules relating to the Payment Card Industry Data Security Standards, and direct marketing, e-mails, text messages or telemarketing,

(B) guidance issued by a Governmental Entity that pertains to one of the laws, rules or standards outlined in clause (A), and (C) industry self-regulatory standards applicable to the protection or Processing of Personal Data, credit cards, direct marketing, e-mails, text messages or telemarketing issued and published by applicable standards organization.

(xviii)      “ Process ” or “ Processing ” means, with respect to data, the use, collection, processing, storage, recording, organization, adaption, alteration, transfer, retrieval, consultation, disclosure, dissemination or combination of such data.

(xix)      “ Proprietary Information and Technology ” means all of the following: works of authorship, computer programs, source code and executable code, whether embodied in software, firmware or otherwise, assemblers, applets, compilers, user interfaces, application programming interfaces, protocols, architectures, documentation, annotations, comments, designs, files, records, schematics, test methodologies, test vectors, emulation and simulation tools and reports, hardware development tools, models, tooling, prototypes, breadboards and other devices, data, data structures, databases, data compilations and collections, inventions (whether or not patentable), invention disclosures, discoveries, improvements, technology, proprietary and confidential ideas and information, know-how and information maintained as trade secrets, tools, concepts, techniques, methods, processes, formulae, patterns, algorithms and specifications, customer lists and supplier lists and any and all instantiations or embodiments of the foregoing or any Intellectual Property Rights in any form and embodied in any media.

(xx)      “ Third-Party Intellectual Property ” means any and all Intellectual Property owned by a third party.

(b)      Status . The Company has full title and ownership of (free and clear of any Encumbrances), or is duly licensed under or otherwise authorized to use, all Intellectual Property necessary to enable it to carry on the Business without any conflict with or infringement upon the rights of others. Other than as set forth in Schedule 2.9(b) of the Company Disclosure Letter, the Company Intellectual Property collectively constitutes all of the Intellectual Property necessary for Acquirer’s conduct of, or that are used in or held for use for, the Business without: (i) the need for Acquirer to acquire or license any other Intellectual Property Right and/or (ii) the breach or violation of any Contract. The Company has not transferred ownership of, or granted any exclusive rights in, any Company Intellectual Property to any third party. No third party has any ownership right, title, interest, claim in or lien on any of the Company-Owned Intellectual Property or Company-Owned Data.

(c)      Company Registered Intellectual Property . Schedule 2.9(c) of the Company Disclosure Letter lists all Company Registered Intellectual Property, the jurisdictions in which it has been issued or registered or in which any application for such issuance and registration has been filed or the jurisdictions in which any other filing or recordation has been made and all actions that are required to be taken by the Company within one hundred twenty (120) days following the Agreement Date in order to avoid prejudice to, impairment or abandonment of such Intellectual Property Rights (including all office actions, provisional conversions, annuity or maintenance fees or re-issuances). Each item of Company Registered Intellectual Property is valid (or in the case of applications, applied for) and subsisting, all registration, maintenance and renewal fees currently due in connection with such Company Registered Intellectual Property have been paid and all documents, recordations and certificates in connection with such Company Registered Intellectual Property currently required to be filed have been filed with the relevant patent, copyright, trademark or other authorities in the United States or foreign jurisdictions, as the case may be, for the purposes of prosecuting, maintaining and perfecting such Company Registered Intellectual Property

and recording the Company’s ownership interests therein. The Company has provided to Acquirer tangible copies of all of the Company’s pending patent applications.

(d)      Company Products . Schedule 2.9(d) of the Company Disclosure Letter: (i) describes all Company Products that have been made available for use or purchase by the Company, including any product or service currently under development and scheduled for commercial release within ninety (90) days following the date of this Agreement, for each such Company Product (and each version thereof) identifying its release date; and (ii) for each Company Product, lists each identifiable item of Company-Owned Intellectual Property that is material to the Company’s ability to provide such Company Product.

(e)      No Assistance . At no time during the conception of or reduction to practice of any of the Company-Owned Intellectual Property was the Company or any developer, inventor or other contributor to such Company-Owned Intellectual Property operating under any grants from any Governmental Entity or agency or private source, or any university, college or other educational institution or research center, performing research sponsored by any Governmental Entity or agency or private source or any university, college or other educational institution or research center subject to any employment agreement or invention assignment or nondisclosure agreement or other obligation with any third party that, in each case, would reasonably be expected to adversely affect the Company’s rights in such Company-Owned Intellectual Property.

(f)      Founders . All rights in, to and under all Intellectual Property created by the Company’s founders for or on behalf or in contemplation of the Company (i) prior to the inception of the Company or (ii) prior to their commencement of employment with the Company have been duly and validly assigned to the Company, and the Company has no reason to believe that any such Person is unwilling to provide Acquirer or the Company with such cooperation as may reasonably be required to complete and prosecute all appropriate United States and foreign patent and copyright filings related thereto. Schedule 2.9(f) of the Company Disclosure Letter identifies all identifiable material Intellectual Property created or owned by the Company’s founders, regardless of when or under what circumstances it was developed, that is used by the Company in the conduct of the Business but that is not solely and exclusively owned by the Company.

(g)      Invention Assignment and Confidentiality Agreement . The Company has secured from all (i) consultants, advisors, employees and independent contractors who independently or jointly contributed to or participated in the conception, reduction to practice, creation or development of any Intellectual Property for the Company and (ii) named inventors of patents and patent applications owned or purported to be owned by the Company (any Person described in clauses (i) or (ii), an “ Author ”), unrestricted exclusive ownership of, all of the Authors’ right, title and interest in and to such Intellectual Property, and the Company has obtained the waiver of all non-assignable rights. No Author has retained any rights, licenses, claims or interest whatsoever with respect to any Intellectual Property developed by the Author for the Company. Without limiting the foregoing, the Company has obtained written and enforceable Contracts including obligations regarding the non-disclosure of proprietary information and Intellectual Property assignments from all current and former Authors. The Company has made available to Acquirer copies of all forms of such disclosure and assignment documents currently and historically used by the Company and, in the case of patents and patent applications, the Company has made available to Acquirer copies of all such assignments.

(h)      No Violation . No current or former employee, consultant, advisor or independent contractor of the Company: (i) is in violation of any term or covenant of any Contract with the Company

relating to employment, invention disclosure, invention assignment, non-disclosure or non-competition or any other Contract with any other party by virtue of such employee’s, consultant’s, advisor’s or independent contractor’s being employed by, or performing services for, the Company or using trade secrets or proprietary information of others without permission or (ii) has developed any technology, software or other copyrightable, patentable or otherwise proprietary work for the Company that is subject to any agreement under which such employee, consultant, advisor or independent contractor has assigned or otherwise granted to any third party any rights (including Intellectual Property Rights) in or to such technology, software or other copyrightable, patentable or otherwise proprietary work. Neither the execution nor delivery of this Agreement will conflict with or result in a breach of the terms, conditions or provisions of, or constitute a default under, any Contract of the type described in clause (i) of the immediately foregoing sentence.

(i)      Confidential Information . The Company has taken all commercially reasonable steps to protect and preserve the confidentiality of all confidential, proprietary and/or non-public information and know-how of the Company (including trade secrets) or provided by any third party to the Company (“ Confidential Information ”). All current and former employees, consultants, advisors or independent contractors of the Company and any third party having access to Confidential Information have executed and delivered to the Company a written legally binding agreement regarding the protection of such Confidential Information. The Company has implemented and maintains reasonable security, disaster recovery and business continuity plans consistent with industry practices of companies offering similar services, and acts in compliance therewith. To the knowledge of the Company, the Company has not experienced any breach of security or otherwise unauthorized access by third parties to the Confidential Information, including Personal Data in the Company’s possession, custody or control. To the knowledge of the Company, there has not been any failure with respect to any of the computer systems, including software, used by the Company in the conduct of the Business. To the knowledge of the Company, neither the Company nor any third-party has disclosed or used any of one another’s Confidential Information of the Company in breach of any agreement (written or verbal, express or implied), fiduciary responsibility or other legal obligation between the Company and such third party.

(j)      Non-Infringement . To the knowledge of the Company, there neither is nor has been any unauthorized use, unauthorized disclosure, infringement or misappropriation of any Company-Owned Intellectual Property by any third party, including any current or former employee, consultant, advisor or independent contractor. There has been no Legal Proceeding brought by the Company or another Person relating to infringement or misappropriation of any Company-Owned Intellectual Property. The Company has no Liability for infringement or misappropriation of any Third-Party Intellectual Property. The operation of the Business, including (i) the design, development, manufacturing, reproduction, marketing, licensing, sale, offer for sale, importation, distribution, provision and/or use of any Company Product and/or Company-Owned Intellectual Property and (ii) the Company’s use of any product, device, process or service used in the Business, has not, does not and will not infringe (directly or indirectly, including via contribution or inducement), misappropriate or violate any Third-Party Intellectual Property, breach any terms of service or any other agreement and does not constitute unfair competition or unfair trade practices under the Applicable Law of any jurisdiction in which the Company conducts its business or in which Company Products are manufactured, marketed, distributed, licensed or sold and there is no basis for any such claims. The Company has not received any written communications (including any third-party reports by customers) alleging that the Company has been sued in any Legal Proceeding, infringed, misappropriated, or violated or, by conducting the Business, would infringe, misappropriate, or violate any Intellectual Property of any other Person or entity. The Company has not received any invitations or demands from third parties for the Company to license or purchase any third-party patents or patent applications. No Company-Owned Intellectual Property or Company Product or to the knowledge of the Company, Third-Party Intellectual Property that is licensed to the Company is subject to any Legal Proceeding, Order, settlement agreement or right that restricts in any

manner the use, transfer or licensing thereof by the Company, or that may affect the validity, use or enforceability of any Company Intellectual Property. The Company has not received any opinion of counsel that any Company Product or Company-Owned Intellectual Property or the operation of the business of the Company, as previously or currently conducted, or as currently proposed to be conducted, infringes or misappropriates any Third-Party Intellectual Property Rights.

(k)      Licenses; Agreements .

(i)      Other than as set forth in Schedule 2.9(k)(i) of the Company Disclosure Letter, except for the non-exclusive licenses to the Company Products on Company’s standard form of customer agreement below $25,000 (the form of which has been made available to Acquirer’s counsel) granted in the ordinary course of Business, the Company has not granted any options, licenses or agreements of any kind relating to any Company-Owned Intellectual Property, and the Company is not bound by or a party to any option, license or agreement of any kind with respect to any of the Company-Owned Intellectual Property.

(ii)      Other than as set forth in Schedule 2.2(k)(ii) of the Company Disclosure Letter, the Company is not obligated to pay any royalties or other payments to third parties with respect to the marketing, sale, distribution, manufacture, license or use of any Company Products or Company-Owned Intellectual Property.

(l)      Other Intellectual Property Agreements . Except as set forth in Schedule 2.2(l) , with respect to the Company Intellectual Property Agreements:

(i)      each such agreement is valid and subsisting and has, where required, under Applicable Laws, been duly recorded or registered;

(ii)      the Company is not (and will not be as a result of the execution and delivery or effectiveness of this Agreement or the performance of the Company’s obligations under this Agreement) in breach of any Company Intellectual Property Agreement, and the consummation of the Transactions will not result in the modification, cancellation, termination, suspension of, or acceleration of any payments, rights, obligations or remedies with respect to any Company Intellectual Property Agreements, or give any non-Company party to any Company Intellectual Property Agreement the right to do any of the foregoing;

(iii)      to the knowledge of the Company, no counterparty to any Company Intellectual Property Agreement is in breach thereof;

(iv)      at and after the Closing, the Company (as a direct or indirect wholly owned subsidiary of Acquirer) will be permitted to exercise all of the Company’s rights under the Company Intellectual Property Agreements to the same extent the Company would have been able to had the Transactions not occurred and without the payment of any additional amounts or consideration other than ongoing fees, royalties or payments that the Company would otherwise be required to pay;

(v)      there are no disputes or Legal Proceedings (pending or threatened) regarding the scope of any Company Intellectual Property Agreements, or performance under any Company Intellectual Property Agreements including with respect to any payments to be made or received by the Company thereunder;

(vi)      no Company Intellectual Property Agreement requires the Company to include any Third-Party Intellectual Property in any Company Product or obtain any Person’s approval of any Company Product at any stage of development, licensing, distribution or sale of that Company Product;

(vii)      none of the Company Intellectual Property Agreements grants any third party exclusive rights to or under any Company-Owned Intellectual Property;

(viii)      none of the Company Intellectual Property Agreements grants any third party the right to sublicense any Company-Owned Intellectual Property;

(ix)      the Company has obtained valid rights (sufficient for the conduct of the Business) to all Third-Party Intellectual Property that is incorporated into, integrated or bundled with, or used to provide, any of the Company Products; and

(x)      no third party that has licensed Intellectual Property Rights to the Company has ownership or license rights to improvements or derivative works made by the Company in the Third-Party Intellectual Property that has been licensed to the Company.

(m)      Non-Contravention . Other than as set forth in Schedule 2.9(m) of the Company Disclosure Letter, none of the execution and performance of this Agreement, the consummation of the Transactions, including, if applicable, the assignment to Acquirer by operation of law or otherwise will result in the following based on any agreement to which the Company is a party: (i) Acquirer or any of its Affiliates granting to any third party any right to or with respect to any Intellectual Property Rights owned by, or licensed to, Acquirer or any of its Affiliates, (ii) Acquirer or any of its Affiliates being bound by or subject to, any exclusivity obligations, non-compete or other restriction on the operation or scope of their respective businesses, (iii) Acquirer or the Company being obligated to pay any royalties or other material amounts to any third party in excess of those payable by any of them, respectively, in the absence of this Agreement or the Transactions or (iv) any termination of licenses or other rights in, or any other material impact to, any Company Intellectual Property.

(n)      Company Source Code. The Company has not disclosed, delivered or licensed to any Person or agreed or obligated itself to disclose, deliver or license to any Person, or permitted the disclosure or delivery to any escrow agent or other Person of, any Company Source Code, other than disclosures to employees, consultants, advisors and independent contractors (i) involved in the development of Company Products and (ii) subject to a written confidentiality agreement. No event has occurred, and no circumstance or condition exists, that (with or without notice or lapse of time, or both) will, or would reasonably be expected to, result in the disclosure, delivery or license by the Company of any Company Source Code, other than disclosures in confidence to employees, consultants, advisors and independent contractors involved in the development of Company Products. Without limiting the foregoing, neither the execution nor performance of this Agreement nor the consummation of any of the Transactions will result in a release from escrow or other delivery to a third party of any Company Source Code. No former employee, consultant, advisor or independent contractor of the Company has retained possession of or access to any Company Source Code.

(o)      Open Source Software. Schedule 2.9(o) of the Company Disclosure Letter identifies all Open Source Materials used in any Company Products, describes the manner in which such Open Source Materials have been used (such description shall include whether (and, if so, how) the Open Source Materials were modified and/or distributed by the Company) and identifies the licenses under which such Open Source Materials have been used. The Company is in material compliance with the terms and conditions of all licenses for the Open Source Materials. The Company has not (i) incorporated Open Source Materials into,

or combined Open Source Materials with, the Company-Owned Intellectual Property or Company Products, (ii) distributed Open Source Materials in conjunction with any Company-Owned Intellectual Property or Company Products or (iii) used Open Source Materials, in such a way that creates, material obligations or material restrictions for the Company with respect to any Company-Owned Intellectual Property or that grants, to any third party any rights or immunities under any Company-Owned Intellectual Property (including using, modifying and/or distributing any Open Source Materials that require, as a condition of such use, modification and/or distribution that other software incorporated into, derived from or distributed with such Open Source Materials be (A) disclosed or distributed in source code form, (B) be licensed for the purpose of making derivative works or (C) be redistributable at no charge). Except as set forth on Schedule 2.9(o) of the Company Disclosure Letter, neither Company nor any Authors have contributed any Company-Owned Intellectual Property or Company Source Code to any third-party open source projects, in such a way that creates obligations or restrictions for the Company with respect to any Company-Owned Intellectual Property or that grants to any third party any rights or immunities under any Company-Owned Intellectual Property.

(p)      Information Technology .

(i)      Status . Schedule 2.9(p)(i)  of the Company Disclosure Letter sets forth material details of the information and communications technology infrastructure and systems (including software, hardware, firmware, networks and the Company Websites) that is used in the Business (collectively, the “ ICT Infrastructure ”) and any security and disaster recovery arrangements relating thereto. The arrangements relating to the ICT Infrastructure (including its operation and maintenance and any amendments or modifications thereto) will not be adversely affected by the Transactions, and the ICT Infrastructure will continue to be available for use by the Company immediately following the consummation of the Transactions and thereafter on substantially the same terms and conditions as prevailed immediately before the Closing, without further action or payment by Acquirer. The Company is the sole legal and beneficial owner of the ICT Infrastructure and the ICT Infrastructure is used exclusively by the Company. The ICT Infrastructure that is currently used in the Business constitutes all the information and communications technology and other systems infrastructure reasonably necessary to carry on the Business, including having sufficient capacity and maintenance and support requirements to satisfy the requirements of the Business with regard to information and communications technology, data processing and communications. The ICT Infrastructure is: (i) in good working order and functions in accordance with all applicable documentation and specifications in all material respects, (ii) maintained and supported in accordance with best industry practice in all material respects sufficient to carry on the Business and to remedy any material defect, and (iii) protected by commercially reasonable security and disaster recovery arrangements.

(ii)      No Faults . The Company has not experienced, and no circumstances exist that are likely or expected to give rise to, any material disruption in or to the operation of the Business as a result of: (A) any substandard performance or defect in any part of the ICT Infrastructure whether caused by any viruses, bugs, worms, software bombs or otherwise, lack of capacity or otherwise or (B) a material breach of security in relation to any part of the ICT Infrastructure.

(iii)      ICT Agreements . All Contracts relating to the ICT Infrastructure are valid and binding and no Contract (including any Contract for Third-Party Intellectual Property) that relates to the ICT Infrastructure has been the subject of any breach by the Company or any other Person, and the Company (A) has not waived any breach thereof by any other Person, (B) has not received any notice of termination of any such Contract and (C) is not aware of any circumstances