STOCK PURCHASE AGREEMENT
**Dated as of 2025**
By and Among
CASCADE RETAIL HOLDINGS INC., a Delaware corporation, as Buyer,
NOVAMART GLOBAL INC., a Delaware corporation, as the Company,
THE SELLING STOCKHOLDERS IDENTIFIED ON SCHEDULE A HERETO, as the Sellers,
and
RIDGELINE EQUITY PARTNERS, LP, a Delaware limited partnership, solely in its capacity as the Stockholder Representative
RECITALS
WHEREAS, NovaMart Global Inc., a Delaware corporation (the "Company"), is engaged in the business of operating an online marketplace platform, ecommerce technology, and logistics software-as-a-service (collectively, the "Business");
WHEREAS, the stockholders identified on Schedule A hereto (each, a "Seller" and collectively, the "Sellers") collectively own one hundred percent (100%) of the issued and outstanding shares of capital stock of the Company (the "Shares"), as set forth on Schedule A hereto, including shares held by Ridgeline Equity Partners, LP (41.2%), Brindoval Ventures Fund III, LP (22.8%), Julian Reeves (18.5%), Priya Narasimhan (8.3%), and certain management and employee stockholders (9.2% in the aggregate, including vested stock options);
WHEREAS, Cascade Retail Holdings Inc., a Delaware corporation ("Buyer"), desires to purchase from the Sellers, and the Sellers desire to sell to Buyer, all of the Shares, on the terms and subject to the conditions set forth in this Agreement;
WHEREAS, the Board of Directors of Buyer has unanimously approved the execution, delivery, and performance of this Agreement and the transactions contemplated hereby (the "Transactions");
WHEREAS, the Sellers holding sufficient shares to constitute the requisite stockholder approval have approved this Agreement and the Transactions by written consent in lieu of a meeting pursuant to Section 228 of the Delaware General Corporation Law;
WHEREAS, Ridgeline Equity Partners, LP, a Delaware limited partnership (the "Stockholder Representative"), has agreed to serve as the representative of the Sellers for post-closing matters as set forth herein;
WHEREAS, concurrently with the execution of this Agreement, (i) Buyer and the Stockholder Representative are entering into an Escrow Agreement with Marlowe Asset Management Trust Company, N.A., as escrow agent (the "Escrow Agent"), substantially in the form attached hereto as Exhibit A, and certain key employees of the Company are entering into employment agreements and retention arrangements with Buyer;
WHEREAS, the parties desire to make certain representations, warranties, covenants, and agreements in connection with the Transactions and to prescribe certain conditions to the consummation of the Transactions;
NOW, THEREFORE, in consideration of the foregoing premises and the mutual covenants, agreements, representations, and warranties contained herein, and for other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the parties hereto, intending to be legally bound, hereby agree as follows:
ARTICLE I — DEFINITIONS
Section 1.01 — Defined Terms
As used in this Agreement, the following terms shall have the meanings set forth below:
"Acquisition Proposal" means any inquiry, proposal, or offer from any Person (other than Buyer or its Affiliates) relating to (a) any direct or indirect acquisition of all or substantially all of the assets of the Company or any of its Subsidiaries, (b) any direct or indirect acquisition of more than twenty percent (20%) of the outstanding equity securities of the Company, (c) any tender offer or exchange offer that, if consummated, would result in any Person beneficially owning more than twenty percent (20%) of the outstanding equity securities of the Company, or (d) any merger, consolidation, business combination, recapitalization, liquidation, dissolution, or similar transaction involving the Company or any of its Subsidiaries.
"Action" means any action, suit, claim, arbitration, mediation, hearing, proceeding, litigation, or investigation, whether civil, criminal, or administrative, at law or in equity, before or by any Governmental Authority.
"Affiliate" means, with respect to any Person, any other Person that directly or indirectly, through one or more intermediaries, controls, is controlled by, or is under common control with, such Person. For purposes of this definition, "control" (including, with correlative meanings, the terms "controlled by" and "under common control with") means the possession, directly or indirectly, of the power to direct or cause the direction of the management and policies of a Person, whether through ownership of voting securities, by contract, or otherwise.
"Aggregate Purchase Price" means One Billion Two Hundred Million Dollars ($1,200,000,000), subject to adjustment as provided in Section 2.06.
"Agreement" means this Stock Purchase Agreement, dated as of 2025, by and among Buyer, the Company, the Sellers, and the Stockholder Representative, together with all Schedules and Exhibits hereto, as the same may be amended, modified, supplemented, or restated from time to time in accordance with Section 12.03.
"Ashford Credit Facility" means the senior revolving credit facility of the Company maintained with Ashford Savings Bank, N.A., as administrative agent and lender, pursuant to that certain Amended and Restated Credit Agreement, dated as of March 15, 2023, in the aggregate principal amount of One Hundred Fifty Million Dollars ($150,000,000), as amended, restated, supplemented, or otherwise modified from time to time.
"Basket" has the meaning set forth in Section 9.04(b).
"Business" has the meaning set forth in the Recitals.
"Business Day" means any day other than a Saturday, Sunday, or any day on which the Federal Reserve Bank of New York is authorized or required by law, regulation, or executive order to close.
"Buyer" means Cascade Retail Holdings Inc., a Delaware corporation.
"Buyer Disclosure Schedules" means the disclosure schedules delivered by Buyer concurrently with the execution of this Agreement.
"Buyer Indemnified Parties" has the meaning set forth in Section 9.02(a).
"Buyer's Counsel" means Calderwood & Harkness LLP, 599 Lexington Avenue, 38th Floor, New York, NY 10022.
"Change of Control" means any transaction or series of related transactions resulting in a change in the ultimate controlling Person of the Company, including the Transactions contemplated hereby, and shall include any merger, consolidation, stock sale, asset sale, or other business combination in which the holders of the equity securities of the Company immediately prior to such transaction cease to hold, directly or indirectly, a majority of the voting power of the surviving or resulting entity.
"Closing" has the meaning set forth in Section 2.03.
"Closing Date" has the meaning set forth in Section 2.03.
"Closing Statement" has the meaning set forth in Section 2.06(b).
"Code" means the Internal Revenue Code of 1986, as amended, and the rules, regulations, and guidance promulgated thereunder.
"Collar Amount" means Million Dollars (
"Company" means NovaMart Global Inc., a Delaware corporation.
"Company Material Adverse Effect" means any event, change, effect, development, condition, circumstance, or occurrence that, individually or in the aggregate, has had or would reasonably be expected to have a material adverse effect on (a) the business, assets, liabilities, financial condition, or results of operations of the Company and its Subsidiaries, taken as a whole, or (b) the ability of the Company or any Seller to consummate the Transactions; provided, however, that none of the following, individually or in the aggregate, shall be deemed to constitute, or be taken into account in determining whether there has been, a Company Material Adverse Effect: (i) changes in general economic, financial, or market conditions; (ii) changes affecting the industry in which the Company operates generally and not disproportionately affecting the Company relative to similarly situated companies; (iii) changes in applicable law or GAAP (or interpretations thereof); (iv) changes resulting from acts of war, armed hostilities, sabotage, terrorism, or any escalation or worsening thereof; (v) epidemics, pandemics (including COVID-19 and any variants thereof), or other public health emergencies; (vi) changes resulting from the announcement or pendency of this Agreement or the Transactions (including any loss of customers, suppliers, employees, or other business relationships resulting therefrom); (vii) any failure, in and of itself, by the Company to meet any projections, estimates, or forecasts (but not the underlying causes thereof);
"Confidentiality Agreement" means that certain Mutual Confidentiality and Non-Disclosure Agreement, dated as of February 10, 2025, between Buyer and the Company.
"Consent" means any consent, approval, waiver, authorization, permit, license, exemption, filing, registration, notice, or similar action of, with, or to any Person, including any Governmental Authority, that is required under any Contract, law, or Order in connection with the execution, delivery, or performance of this Agreement or the consummation of the Transactions.
"Contract" means any agreement, contract, lease, sublease, license, sublicense, purchase order, work order, instrument, note, bond, mortgage, indenture, guarantee, or other legally binding arrangement or commitment, whether written or oral.
"D&O Tail Policy" has the meaning set forth in Section 6.07.
"DGCL" means the Delaware General Corporation Law, Title 8 of the Delaware Code, as amended from time to time.
"Disclosure Schedules" means, collectively, the Seller Disclosure Schedules and the Buyer Disclosure Schedules.
"Environmental Laws" means all federal, state, local, and foreign laws, statutes, regulations, ordinances, codes, rules, orders, judgments, decrees, and directives relating to pollution, the protection of the environment, human health and safety (as it relates to exposure to Hazardous Substances), natural resources, or the management, generation, use, storage, treatment, transportation, release, or disposal of Hazardous Substances, including the Comprehensive Environmental Response, Compensation, and Liability Act (42 U.S.C. § 9601 et seq.), the Resource Conservation and Recovery Act (42 U.S.C. § 6901 et seq.), the Clean Air Act (42 U.S.C. § 7401 et seq.), the Clean Water Act (33 U.S.C. § 1251 et seq.), the Toxic Substances Control Act (15 U.S.C. § 2601 et seq.), and their state and local counterparts.
"ERISA" means the Employee Retirement Income Security Act of 1974, as amended, and the rules, regulations, and guidance promulgated thereunder.
"Escrow Agent" means Marlowe Asset Management Trust Company, N.A., a national trust company.
"Escrow Agreement" means the Escrow Agreement, dated as of the date hereof, by and among Buyer, the Stockholder Representative, and the Escrow Agent, substantially in the form attached hereto as Exhibit A.
"Escrow Amount" means Million Dollars ( being eight percent (8%) of the Aggregate Purchase Price.
"Escrow Fund" means the Escrow Amount, together with all interest, earnings, and other income thereon, held by the Escrow Agent pursuant to the Escrow Agreement.
"Estimated Closing Statement" has the meaning set forth in Section 2.06(a).
"Estimated Net Working Capital" has the meaning set forth in Section 2.06(a).
"FIRPTA Certificate" has the meaning set forth in Section 7.02(i).
"Forward Termination Fee" means Million Dollars ( being two and one-half percent (2.5%) of the Aggregate Purchase Price.
"Fundamental Representations" means the representations and warranties set forth in Sections 3.01 (Organization and Good Standing of the Company), 3.02 (Authorization; Binding Effect), 3.03 (Capitalization), 3.24 (Seller Authority and Ownership), 4.01 (Organization and Good Standing of Buyer), 4.02 (Authorization; Binding Effect of Buyer), 4.05 (Financial Capability), and 5.01 through 5.04 (Representations and Warranties of the Stockholder Representative).
"GAAP" means United States generally accepted accounting principles as in effect from time to time, consistently applied.
"Governmental Authority" means any federal, state, local, municipal, or foreign government or political subdivision thereof, or any agency, authority, bureau, commission, department, tribunal, court, or instrumentality of any of the foregoing, including any quasi-governmental or private body exercising any regulatory, taxing, legislative, judicial, or administrative authority.
"Hazardous Substances" means any substance, material, or waste that is listed, defined, designated, or classified as hazardous, toxic, radioactive, dangerous, or a pollutant or contaminant under any Environmental Law, including petroleum and petroleum products, asbestos-containing materials, polychlorinated biphenyls, per- and polyfluoroalkyl substances, and urea formaldehyde.
"HSR Act" means the Hart-Scott-Rodino Antitrust Improvements Act of 1976, as amended, and the rules and regulations promulgated thereunder.
"Indebtedness" means, with respect to any Person, without duplication: (a) all obligations for borrowed money; (b) all obligations evidenced by bonds, debentures, notes, or similar instruments; (c) all obligations under capitalized leases (as determined in accordance with GAAP as in effect on the date of this Agreement); (d) all obligations under conditional sale or other title retention agreements; (e) all obligations, contingent or otherwise, as an account party or applicant under or in respect of bankers' acceptances, letters of credit, surety bonds, or similar arrangements; (f) all obligations of others guaranteed by such Person; (g) all obligations secured by any Lien on property of such Person; (h) all obligations in respect of interest rate swap, hedging, or similar agreements; (i) all accrued and unpaid interest, premiums, penalties, breakage costs, change-of-control payments, and make-whole amounts with respect to any of the foregoing; and (j) all obligations of the type referred to in clauses (a) through (i) of any Persons the payment of which such Person is responsible or liable, directly or indirectly, as obligor, guarantor, surety, or otherwise.
"Indemnification Cap" means of the Aggregate Purchase Price.
"Indemnified Party" means a Person entitled to indemnification under Article IX.
"Indemnifying Party" means a Person obligated to provide indemnification under Article IX.
"Independent Accountant" has the meaning set forth in Section 2.06(d).
"intellectual Property" means all intellectual property and proprietary rights of any kind or nature, including: (a) patents, patent applications, statutory invention registrations, and invention disclosures; (b) trademarks, service marks, trade names, brand names, logos, trade dress, domain names, and all goodwill associated therewith; (c) copyrights, works of authorship, and rights in databases; (d) trade secrets, know-how, inventions, processes, formulae, techniques, algorithms, and confidential business information; (e) software, firmware, computer programs, and source code; and (f) all registrations, applications, renewals, extensions, continuations, divisions, or reissues of, and rights to apply for, any of the foregoing.
"Key Employees" means Julian Reeves and Priya Narasimhan.
"Knowledge of Buyer" means the actual knowledge of Margaret Alderton, Rajiv Sundaram, Elena Vasquez-Bright, and Theodore Langford, in each case after reasonable inquiry of their direct reports.
"Knowledge of the Company" means the actual knowledge of Julian Reeves, Priya Narasimhan, Douglas Whitfield, and Amanda Trevino, in each case after reasonable inquiry of their direct reports .
"Leased Real Property" has the meaning set forth in Section 3.12(b).
"Lien" means any mortgage, pledge, hypothecation, security interest, encumbrance, lien (statutory or otherwise), charge, option, right of first refusal, right of first offer, restriction on transfer, easement, servitude, assessment, preemptive right, community property interest, or other similar restriction or encumbrance of any kind.
"Losses" means any and all losses, damages, liabilities, deficiencies, judgments, settlements, awards, interest, penalties, fines, costs, and expenses (including reasonable and documented out-of-pocket attorneys' fees and expenses and costs of investigation), but excluding punitive, exemplary, or consequential damages (except to the extent such punitive, exemplary, or consequential damages are awarded to a third party in connection with a third-party claim).
"Material Contracts" has the meaning set forth in Section 3.14.
"Net Cash to Sellers at Closing" means an amount equal to One Billion One Hundred Four Million Dollars ($1,104,000,000), being the Aggregate Purchase Price minus the Escrow Amount, subject to the Estimated Net Working Capital adjustment set forth in Section 2.06(a).
"Net Working Capital" means, as of any determination date, the current assets of the Company minus the current liabilities of the Company, in each case as defined and calculated in accordance with the Working Capital Methodology set forth in Exhibit D.
"Net Working Capital Target" means Seventy-Eight Million Five Hundred Thousand Dollars ($78,500,000).
"Order" means any judgment, order, decree, ruling, stipulation, determination, award, writ, or injunction of any Governmental Authority or arbitrator.
"Outside Date" means December 31, 2025.
"Owned Real Property" has the meaning set forth in Section 3.12(a).
"Paying Agent" means Marlowe Asset Management Trust Company, N.A., acting in its capacity as paying agent pursuant to the Paying Agent Agreement.
"Paying Agent Agreement" means the agreement among Buyer, the Stockholder Representative, and the Paying Agent, substantially in the form attached hereto as Exhibit I, regarding the distribution of closing consideration to the Sellers.
"Permitted Liens" means: (a) statutory Liens for current Taxes, assessments, or governmental charges not yet due and payable or being contested in good faith by appropriate proceedings and for which adequate reserves have been established in accordance with GAAP; (b) mechanics', carriers', workers', repairers', materialmen's, warehousemen's, and similar Liens arising or incurred in the ordinary course of business consistent with past practice for amounts not yet due and payable; (c) zoning, entitlement, building, and other land use regulations imposed by any Governmental Authority having jurisdiction that are not violated by the current use or occupancy of the applicable real property; (d) covenants, conditions, restrictions, easements, encumbrances, and other similar matters of record affecting title to real property that do not materially impair the occupancy or use of the applicable real property; (e) Liens arising under workers' compensation, unemployment insurance, social security, retirement, and similar legislation; and (f) non-exclusive licenses of intellectual Property granted in the ordinary course of business consistent with past practice.
"Person" means any individual, corporation, partnership, limited liability company, joint venture, association, trust, unincorporated organization, estate, Governmental Authority, or other entity.
"Pre-Closing Tax Period" means any Tax period ending on or before the Closing Date and the pre-Closing portion of any Straddle Period.
"Pro Rata Portion" means, with respect to each Seller, the percentage set forth opposite such Seller's name on Schedule A.
"R&W Insurance Policy" means the representations and warranties insurance policy issued by Meridian Specialty Insurance Company, Policy No. MSI-RWI-2025-07832, in the aggregate policy limit of Two Hundred Sixteen Million Dollars ($216,000,000).
"Remedial Actions" has the meaning set forth in Section 6.03(d).
"Representatives" means, with respect to any Person, such Person's officers, directors, managers, members, partners, employees, agents, consultants, accountants, attorneys, financial advisors, investment bankers, and other advisors and representatives.
"Retention Pool" means the aggregate retention bonus pool in the amount of Eighteen Million Dollars ($18,000,000) for key employees of the Company, as further described in Section 6.08(b).
"Reverse Termination Fee" means Thirty Million Dollars ($30,000,000), being two and one-half percent (2.5%) of the Aggregate Purchase Price.
"Seller Disclosure Schedules" means the disclosure schedules delivered by the Company and the Sellers concurrently with the execution of this Agreement.
"Seller Indemnified Parties" has the meaning set forth in Section 9.03.
"Sellers" means, collectively, the stockholders of the Company identified on Schedule A hereto.
"Shares" means all of the issued and outstanding shares of capital stock of the Company, as further described in Section 3.03 and Schedule A.
"Specified Indemnification Matters" means the matters set forth on Schedule 9.02(a)(iv).
"Stockholder Representative" means Ridgeline Equity Partners, LP, a Delaware limited partnership, acting through Franklin Osei, Managing Partner, solely in its capacity as the representative of the Sellers as set forth in Article X.
"Straddle Period" means any Tax period beginning on or before and ending after the Closing Date.
"Subsidiary" means, with respect to any Person, any corporation, limited liability company, partnership, association, trust, or other entity of which such Person (either alone or through or together with any other Subsidiary) (a) owns, directly or indirectly, more than fifty percent (50%) of the outstanding equity securities the holders of which are generally entitled to vote for the election of the board of directors or other governing body of such entity, or (b) otherwise has the power to direct or cause the direction of the management and policies of such entity.
"Superior Proposal" means any bona fide written Acquisition Proposal (with all references to "twenty percent (20%)" in the definition thereof deemed to be references to "a majority") that the Board of Directors of the Company determines in good faith (after consultation with its outside financial advisors and outside legal counsel) is more favorable to the Sellers from a financial point of view than the Transactions (taking into account any adjustments to the terms and conditions of this Agreement proposed by Buyer in response thereto), and is reasonably capable of being consummated on the terms proposed.
"Tax" or "Taxes" means (a) all federal, state, local, foreign, and other taxes of any kind, including income, gross receipts, franchise, estimated, alternative minimum, add-on minimum, sales, use, transfer, real property gains, registration, value added, excise, natural resources, severance, stamp, occupation, premium, windfall profit, environmental, customs, duties, real property, special assessment, personal property, capital stock, social security, unemployment, employment, disability, payroll, license, employee, withholding, or other tax imposed by any Governmental Authority, (b) all interest, penalties, fines, additions to tax, or additional amounts imposed by any Governmental Authority in connection with any item described in clause (a), and (c) any liability for payment of any amounts of the type described in clause (a) or clause (b) as a result of being a member of an affiliated, consolidated, combined, or unitary group for any period, as a transferee or successor, by contract, or otherwise.
"Tax Representations" means the representations and warranties set forth in Section 3.17.
"Tax Return" means any return, declaration, report, claim for refund, information return, statement, or other document filed or required to be filed with any Governmental Authority relating to Taxes, including any amendment or supplement thereof.
"Transaction Costs" means all fees, costs, and expenses incurred by or on behalf of the Company, the Sellers, or the Stockholder Representative in connection with the negotiation, preparation, execution, and consummation of this Agreement and the Transactions, including fees of legal counsel, financial advisors, accountants, and other advisors and Representatives.
"Transactions" has the meaning set forth in the Recitals.
"Transfer Agent" means Continental Stocktransfer & Trust, Inc.
"Transfer Taxes" has the meaning set forth in Section 6.09(d).
"WARN Act" means the Worker Adjustment and Retraining Notification Act of 1988, as amended, and any similar state or local laws.
"Working Capital Methodology" means the methodology for calculating Net Working Capital set forth in Exhibit D attached hereto.
Section 1.02 — Rules of Construction
(a) The definitions set forth in Section 1.01 shall apply equally to both the singular and plural forms of the terms defined. Whenever the context may require, any pronoun shall include the corresponding masculine, feminine, and neuter forms. The words "include," "includes," and "including" shall be deemed to be followed by the phrase "without limitation." The words "herein," "hereof," "hereby," "hereunder," and words of similar import refer to this Agreement as a whole (including the Disclosure Schedules and Exhibits) and not to any particular Article, Section, paragraph, or clause. Unless the context otherwise requires, all references herein to Articles, Sections, Schedules, and Exhibits shall mean the Articles, Sections, Schedules, and Exhibits of and to this Agreement.
(b) The headings and captions contained in this Agreement are for reference purposes only and shall not affect in any way the meaning or interpretation of this Agreement.
(c) Whenever this Agreement refers to a number of days, such number shall refer to calendar days unless Business Days are specified. If any action is to be taken or given on or by a particular calendar day, and such calendar day is not a Business Day, then such action may be deferred until, or such notice may be given on, the next Business Day.
(d) All references to "$" or "dollars" shall mean United States dollars.
(e) The Disclosure Schedules and Exhibits referenced herein are a part of this Agreement as if fully set forth herein. All Exhibits and Schedules annexed hereto or referred to herein are hereby incorporated in and made a part of this Agreement as if set forth in full herein.
(f) The parties have participated jointly in the negotiation and drafting of this Agreement, and in the event of any ambiguity or question of intent or interpretation, this Agreement shall be construed as if drafted jointly by the parties, and no presumption or burden of proof shall arise favoring or disfavoring any party by virtue of the authorship of any provision of this Agreement.
ARTICLE II — PURCHASE AND SALE; CLOSING; PURCHASE PRICE ADJUSTMENT
Section 2.01 — Purchase and Sale of Shares
Subject to the terms and conditions of this Agreement, at the Closing, each Seller shall sell, transfer, assign, convey, and deliver to Buyer, and Buyer shall purchase and acquire from each Seller, all of the Shares owned by such Seller, free and clear of all Liens (other than Permitted Liens and restrictions under applicable federal and state securities laws). The aggregate consideration for the Shares shall be the Aggregate Purchase Price of One Billion Two Hundred Million Dollars ($1,200,000,000), payable entirely in cash as set forth in Section 2.02. For the avoidance of doubt, the consideration for the Shares does not include any stock component, earnout, contingent consideration, or deferred payment obligation of any kind.
Section 2.02 — Payment of Purchase Price
(a) At the Closing, Buyer shall pay or cause to be paid in immediately available funds by wire transfer:
(i) To the Escrow Agent, the Escrow Amount of Ninety-Six Million Dollars ($96,000,000) by wire transfer to the account designated by the Escrow Agent (Marlowe Asset Management Trust Company, N.A.) in accordance with the Escrow Agreement; and
(ii) To the Paying Agent (or, if no Paying Agent has been engaged with respect to a particular Seller, directly to the bank account designated by such Seller in writing to Buyer not fewer than three (3) Business Days prior to the Closing Date), an aggregate amount equal to the Aggregate Purchase Price minus the Escrow Amount (i.e., One Billion One Hundred Four Million Dollars ($1,104,000,000)), subject to the estimated Net Working Capital adjustment set forth in Section 2.06(a) (such amount, as so adjusted, the "Closing Cash Consideration"), for distribution to each Seller in accordance with such Seller's Pro Rata Portion as set forth on Schedule A.
(b) Each Seller's Pro Rata Portion of the Aggregate Purchase Price (and of the Escrow Amount) shall be calculated based on the ownership percentages set forth opposite such Seller's name on Schedule A. The Paying Agent shall distribute to each Seller an amount equal to such Seller's Pro Rata Portion of the Closing Cash Consideration, in accordance with the terms and conditions of the Paying Agent Agreement and the Letter of Transmittal delivered by such Seller.
(c) Buyer shall be entitled to deduct and withhold from the consideration otherwise payable to any Seller pursuant to this Agreement any amounts that Buyer is required to deduct and withhold with respect to the making of such payment under the Code or any applicable provision of federal, state, local, or foreign Tax law. To the extent that amounts are so withheld and timely remitted to the applicable Governmental Authority, such withheld amounts shall be treated for all purposes of this Agreement as having been paid to the Seller in respect of which such deduction and withholding was made. Buyer shall use commercially reasonable efforts to notify the Stockholder Representative and any affected Seller of any anticipated withholding at least five (5) Business Days prior to the Closing Date and to cooperate with the Stockholder Representative and such Seller to minimize or eliminate any such withholding to the extent permissible under applicable law.
Section 2.03 — Closing
The closing of the purchase and sale of the Shares (the "Closing") shall take place at the offices of Calderwood & Harkness LLP, 599 Lexington Avenue, 38th Floor, New York, New York 10022 (or remotely by electronic exchange of executed documents and other closing deliverables via email or other electronic transmission, in each case as mutually agreed by the parties), commencing at 10:00 a.m. Eastern Time on the third (3rd) Business Day following the satisfaction or waiver of all conditions precedent set forth in Article VII (other than those conditions that by their nature are to be satisfied at the Closing, but subject to the satisfaction or waiver of such conditions at the Closing), or at such other date, time, and place as Buyer and the Stockholder Representative may mutually agree in writing. The parties anticipate that the Closing will occur on or about October 15, 2025, subject to the satisfaction or waiver of the conditions set forth in Article VII. The date on which the Closing actually occurs is referred to herein as the "Closing Date." For all purposes under this Agreement, the Closing shall be deemed to have occurred as of 12:01 a.m. Eastern Time on the Closing Date.
Section 2.04 — Closing Deliverables of the Sellers and the Company
At the Closing, the Company and the Sellers (as applicable) shall deliver or cause to be delivered to Buyer each of the following:
(a) Stock certificates representing all of the Shares, duly endorsed in blank or accompanied by duly executed stock powers, in each case in form reasonably satisfactory to Buyer, with all requisite stock transfer stamps affixed thereto, sufficient to transfer good and valid title to the Shares to Buyer free and clear of all Liens (other than Permitted Liens and restrictions under applicable securities laws);
(b) A certificate duly executed by the Chief Executive Officer or Chief Financial Officer of the Company, dated as of the Closing Date, certifying the satisfaction of the conditions set forth in Section 7.02(a) and Section 7.02(c) (the "Company Officer's Certificate");
(c) A certificate duly executed by the Secretary or Assistant Secretary of the Company, dated as of the Closing Date, certifying and attaching (i) the certificate of incorporation of the Company as then in effect, (ii) the bylaws of the Company as then in effect, (iii) copies of the resolutions of the Board of Directors of the Company authorizing and approving this Agreement and the Transactions, (iv) copies of the written consent of the stockholders of the Company approving this Agreement and the Transactions pursuant to Section 228 of the DGCL, and (v) an officer incumbency certificate (the "Company Secretary's Certificate");
(d) Good standing certificates (or equivalent certificates of status) for the Company from the Secretary of State of the State of Delaware and the Secretary of State of the State of Texas, and each other state in which the Company is qualified to do business, each dated within ten (10) Business Days of the Closing Date;
(e) A properly executed certification of non-foreign status, in form and substance required under Treasury Regulations Section 1.1445-2(b)(2), certifying that NovaMart Global Inc. (EIN: 84-3291547) is not a "foreign person" within the meaning of Section 1445 of the Code (the "FIRPTA Certificate"), substantially in the form attached hereto as Exhibit E;
(f) The Escrow Agreement, duly executed by the Stockholder Representative;
(g) The Stockholder Representative Agreement, duly executed by the Stockholder Representative, substantially in the form attached hereto as Exhibit B;
(h) Payoff letters from Ashford Savings Bank, N.A. (or such other administrative agent under the Ashford Credit Facility), in form and substance reasonably satisfactory to Buyer, setting forth the aggregate amount required to satisfy in full all obligations of the Company under the Ashford Credit Facility as of the Closing Date (estimated to be approximately $143,200,000 in outstanding principal plus accrued and unpaid interest, fees, and other amounts), together with duly executed UCC-3 termination statements and other lien releases or termination documents sufficient to evidence the release of all Liens securing obligations under the Ashford Credit Facility and the termination of all commitments thereunder;
(i) Evidence, in form and substance reasonably satisfactory to Buyer, of the termination of the Ashford Credit Facility effective as of the Closing;
(j) Written resignations, effective as of the Closing, of each director and officer of the Company as Buyer shall have requested in writing not fewer than five (5) Business Days prior to the Closing Date;
(k) Evidence of receipt of all third-party Consents set forth on Schedule 7.02(g), in form and substance reasonably satisfactory to Buyer;
(l) Executed employment agreements between Buyer (or the Company) and each of Julian Reeves and Priya Narasimhan, substantially in the forms attached hereto as Exhibit F and Exhibit G, respectively;
(m) The Estimated Closing Statement, prepared and delivered in accordance with Section 2.06(a);
(n) Evidence of the binding of the D&O Tail Policy by Sovereign Assurance Group Ltd., providing coverage for a period of six (6) years following the Closing on terms no less favorable than the Company's existing directors' and officers' insurance policy, in form and substance reasonably satisfactory to Buyer; and
(o) Such other certificates, instruments, documents, and items as Buyer may reasonably request in order to effectuate the Transactions and carry out the purposes and intent of this Agreement.
Section 2.05 — Closing Deliverables of Buyer
At the Closing, Buyer shall deliver or cause to be delivered to the Stockholder Representative (on behalf of the Sellers) each of the following:
(a) Payment of the Aggregate Purchase Price in accordance with Section 2.02, including (i) wire transfer of the Escrow Amount to the Escrow Agent and (ii) wire transfer of the Closing Cash Consideration to the Paying Agent (or directly to the Sellers' designated accounts, as applicable);
(b) A certificate duly executed by the Chief Executive Officer or Chief Financial Officer of Buyer, dated as of the Closing Date, certifying the satisfaction of the conditions set forth in Section 7.03(a) (the "Buyer Officer's Certificate");
(c) A certificate duly executed by the Secretary or Assistant Secretary of Buyer, dated as of the Closing Date, certifying and attaching (i) the certificate of incorporation of Buyer as then in effect, (ii) the bylaws of Buyer as then in effect, (iii) copies of the resolutions of the Board of Directors of Buyer authorizing and approving this Agreement and the Transactions, and (iv) an officer incumbency certificate (the "Buyer Secretary's Certificate");
(d) The Escrow Agreement, duly executed by Buyer;
(e) The Paying Agent Agreement, duly executed by Buyer, substantially in the form attached hereto as Exhibit I;
(f) Evidence that the R&W Insurance Policy (Meridian Specialty Insurance Company, Policy No. MSI-RWI-2025-07832, with a policy limit of $216,000,000) is in full force and effect as of the Closing Date;
and
Such other certificates, instruments, documents, and items as the Stockholder Representative may reasonably request in order to effectuate the Transactions and carry out the purposes and intent of this Agreement.
Section 2.06 — Working Capital Adjustment
(a) Estimated Closing Statement. Not later than five (5) Business Days prior to the Closing Date, the Company shall prepare and deliver to Buyer a statement (the "Estimated Closing Statement") setting forth the Company's good faith estimate of the Net Working Capital of the Company as of immediately prior to the Closing (the "Estimated Net Working Capital"), calculated in accordance with the Working Capital Methodology set forth in Exhibit D. The Company shall prepare the Estimated Closing Statement in good faith and in a manner consistent with the Working Capital Methodology and GAAP as applied in the preparation of the Company's historical financial statements. The Company shall provide Buyer and its Representatives with reasonable access to the books, records, and personnel of the Company as reasonably necessary to review the Estimated Closing Statement.
(i) If the Estimated Net Working Capital exceeds the Net Working Capital Target ($78,500,000) by more than the Collar Amount ($5,000,000), the amount by which the Estimated Net Working Capital exceeds the sum of the Net Working Capital Target plus the Collar Amount (i.e., the excess above $83,500,000) shall be added to the Net Cash to Sellers at Closing.
(ii) If the Estimated Net Working Capital is less than the Net Working Capital Target ($78,500,000) by more than the Collar Amount ($5,000,000), the amount by which the Net Working Capital Target minus the Collar Amount (i.e., $73,500,000) exceeds the Estimated Net Working Capital shall be deducted from the Net Cash to Sellers at Closing.
(iii) If the Estimated Net Working Capital is within the Collar Amount of the Net Working Capital Target (i.e., the Estimated Net Working Capital is greater than or equal to $73,500,000 and less than or equal to $83,500,000), no adjustment shall be made to the Net Cash to Sellers at Closing at the time of the Closing.
(b) Post-Closing True-Up. Within days after the Closing Date, Buyer shall prepare and deliver to the Stockholder Representative a statement (the "Closing Statement") setting forth Buyer's calculation of the actual Net Working Capital of the Company as of immediately prior to the Closing (the "Final Net Working Capital"), calculated in accordance with the Working Capital Methodology set forth in Exhibit D. The Closing Statement shall be prepared in good faith and in a manner consistent with the Working Capital Methodology and GAAP as applied in the preparation of the Estimated Closing Statement and the Company's historical financial statements. Buyer shall provide the Stockholder Representative and its Representatives with reasonable access to the books, records, work papers, and personnel of the Company (as owned by Buyer following the Closing) as reasonably necessary to review the Closing Statement.
(c) Review Period. The Stockholder Representative shall have days following receipt of the Closing Statement (the "Review Period") to review the Closing Statement. If the Stockholder Representative has any objections to the Closing Statement, the Stockholder Representative shall deliver to Buyer, on or before the last day of the Review Period, a written notice of disagreement (the "Notice of Disagreement") specifying in reasonable detail (i) each item on the Closing Statement that the Stockholder Representative disputes, (ii) the Stockholder Representative's proposed adjustment to each such disputed item, and (iii) the basis for each such proposed adjustment. Any items on the Closing Statement not specifically identified in the Notice of Disagreement shall be deemed accepted by the Stockholder Representative and shall be final, binding, and conclusive for all purposes hereunder. If the Stockholder Representative does not deliver a timely Notice of Disagreement within the Review Period, the Closing Statement as delivered by Buyer shall be deemed accepted by the Stockholder Representative and shall become final and binding on the parties for all purposes hereunder.
(d) Dispute Resolution. If a Notice of Disagreement is timely delivered, Buyer and the Stockholder Representative shall negotiate in good faith for a period of twenty (20) days following receipt of the Notice of Disagreement (or such longer period as they may mutually agree in writing) to resolve all items in dispute. If Buyer and the Stockholder Representative are unable to resolve all disputed items within such twenty (20)-day period, then the remaining unresolved items (and only such remaining unresolved items) shall be submitted for final and binding determination to an independent nationally recognized accounting firm mutually agreed upon by Buyer and the Stockholder Representative (the "Independent Accountant"). If Buyer and the Stockholder Representative cannot agree on the identity of the Independent Accountant within ten (10) Business Days, either party may request the American Arbitration Association to appoint an Independent Accountant that is not then serving as the regular independent auditor of Buyer, the Company, or any Seller. The Independent Accountant shall act as an expert and not an arbitrator and shall determine only those items still in dispute. The Independent Accountant shall make its determination based solely on (i) the written submissions of Buyer and the Stockholder Representative (each party shall submit a single written submission, together with any supporting documentation and work papers) and (ii) the definitions and standards set forth in this Agreement and the Working Capital Methodology; the Independent Accountant shall not conduct an independent investigation. The Independent Accountant's determination of each disputed item shall not be outside the range defined by Buyer's calculation and the Stockholder Representative's calculation with respect to such item. The Independent Accountant shall make its determination within thirty (30) days of the submission of all materials by the parties. The determination of the Independent Accountant shall be final and binding on the parties and shall not be subject to appeal or further review. The fees and expenses of the Independent Accountant shall be allocated between Buyer, on the one hand, and the Sellers (payable from the Escrow Fund or directly by the Sellers), on the other hand, based upon the percentage that the amount of the contested items not awarded to each party bears to the aggregate amount of all contested items, as determined by the Independent Accountant.
(e) Payment of Adjustment. Within five (5) Business Days after the final determination of the Final Net Working Capital in accordance with this Section 2.06 (whether by agreement of the parties, expiration of the Review Period without a Notice of Disagreement, or determination by the Independent Accountant):
(i) If the Final Net Working Capital exceeds the Estimated Net Working Capital, Buyer shall pay to the Stockholder Representative (for distribution to the Sellers in accordance with their Pro Rata Portions) an amount in cash equal to such excess, by wire transfer of immediately available funds to an account designated by the Stockholder Representative.
(ii) If the Estimated Net Working Capital exceeds the Final Net Working Capital, the Stockholder Representative shall cause to be paid to Buyer an amount in cash equal to such excess, first from the Escrow Fund (by delivery of joint written instructions to the Escrow Agent) and, if the Escrow Fund is insufficient to satisfy such amount in full, the remaining balance shall be paid directly by the Sellers (severally, in accordance with their Pro Rata Portions) by wire transfer of immediately available funds to an account designated by Buyer.
(iii) Any payment made pursuant to this Section 2.06(e) shall bear interest from the Closing Date to the date of payment at the prime rate as published in The Wall Street Journal on the Closing Date (or, if the Closing Date is not a Business Day, on the immediately preceding Business Day), calculated on a daily basis based on a 365-day year.
Section 2.07 — Escrow
(a) At the Closing, Buyer shall deposit the Escrow Amount of Ninety-Six Million Dollars ($96,000,000), being eight percent (8%) of the Aggregate Purchase Price, with the Escrow Agent by wire transfer of immediately available funds to the account designated by the Escrow Agent. The Escrow Amount shall be held, invested, and distributed by the Escrow Agent in accordance with the terms and conditions of the Escrow Agreement.
(b) The Escrow Fund shall be governed by the Escrow Agreement entered into by and among Buyer, the Stockholder Representative, and Marlowe Asset Management Trust Company, N.A. (Patricia Keane, Vice President, Escrow Services). The Escrow Agent shall invest the Escrow Fund as specified in the Escrow Agreement, and all interest and earnings on the Escrow Fund shall be added to and become part of the Escrow Fund.
(c) (i) any amounts that have been distributed from the Escrow Fund to Buyer or are otherwise required to be retained by the Escrow Agent in accordance with the Escrow Agreement, and (ii) an amount equal to all pending but unresolved indemnification claims made by Buyer Indemnified Parties pursuant to Article IX for which Buyer has delivered a written claim notice to the Stockholder Representative on or prior to the (such reserved amount, the "Pending Claims Reserve"). The Pending Claims Reserve shall be held and distributed by the Escrow Agent in accordance with the Escrow Agreement until final resolution of each such pending claim.
Section 2.08 — Withholding
Buyer's right to deduct and withhold Taxes from payments hereunder, and the treatment of amounts so withheld, shall be as set forth in Section 2.02(c). The parties shall cooperate to obtain any applicable exemptions from, or reductions in, any such withholding obligations.
ARTICLE III — REPRESENTATIONS AND WARRANTIES OF THE COMPANY AND THE SELLERS
Except as set forth in the Seller Disclosure Schedules (with specific reference to the Section or subsection of this Agreement to which the information set forth in such Seller Disclosure Schedules relates; provided that disclosure of any item in any Section or subsection of the Seller Disclosure Schedules shall be deemed disclosure with respect to any other Section or subsection to the extent that the relevance of such item to such other Section or subsection is reasonably apparent on the face of such disclosure), the Company and each Seller (solely with respect to the representations and warranties set forth in Sections 3.24 through 3.28 and jointly with respect to the representations and warranties set forth in Sections 3.01 through 3.23) hereby represent and warrant to Buyer as of the date hereof and as of the Closing Date (except for representations and warranties that are expressly made as of a specific date, which are made only as of such date) as follows:
Section 3.01 — Organization and Good Standing of the Company
(a) The Company is a corporation duly organized, validly existing, and in good standing under the laws of the State of Delaware. The Company has all requisite corporate power and authority to own, lease, and operate its properties and assets and to carry on the Business as presently conducted. The Company's Employer Identification Number is 84-3291547. The Company's registered agent in the State of Delaware is Pinnacle Corporate Services Inc., 850 New Burton Road, Suite 201, Dover, Delaware 19904.
(b) The Company's principal executive offices are located at 1100 Congress Avenue, Suite 800, Austin, Texas 78701. The Company is duly qualified or licensed to do business as a foreign corporation and is in good standing in each jurisdiction in which the character of the properties owned, leased, or operated by it or the nature of its activities makes such qualification or licensing necessary, except where the failure to be so qualified or licensed would not, individually or in the aggregate, reasonably be expected to have a Company Material Adverse Effect. The jurisdictions in which the Company is so qualified include the States of Texas, California, New Jersey, Georgia, Ohio, Illinois, Pennsylvania, Tennessee, Florida, and Washington.
(c) The Company has made available to Buyer true, correct, and complete copies of the Company's certificate of incorporation and bylaws, each as currently in effect.
(d) Schedule 3.01 sets forth a true, correct, and complete list of all Subsidiaries of the Company, including each Subsidiary's name, jurisdiction of organization, authorized and outstanding equity interests, and the identity of each holder thereof. Each Subsidiary of the Company is duly organized, validly existing, and in good standing under the laws of its jurisdiction of organization, and has all requisite power and authority to own, lease, and operate its properties and to carry on its business as presently conducted.
Section 3.02 — Authorization; Binding Effect
(a) The Company has all requisite corporate power and authority to execute, deliver, and perform this Agreement and each of the ancillary agreements to which it is or will be a party, and to consummate the Transactions. The execution, delivery, and performance by the Company of this Agreement and each such ancillary agreement, and the consummation of the Transactions, have been duly and validly authorized by all necessary corporate action on the part of the Company, including the unanimous approval of the Board of Directors of the Company and the approval of the stockholders of the Company by written consent in lieu of a meeting pursuant to Section 228 of the DGCL. No other corporate proceedings on the part of the Company are necessary to authorize this Agreement or the Transactions.
(b) This Agreement has been duly executed and delivered by the Company and, assuming the due authorization, execution, and delivery by each of the other parties hereto, constitutes the legal, valid, and binding obligation of the Company, enforceable against the Company in accordance with its terms, subject to (i) applicable bankruptcy, insolvency, reorganization, moratorium, fraudulent conveyance, and other similar laws of general applicability relating to or affecting creditors' rights generally and (ii) general equitable principles (whether considered in a proceeding in equity or at law).
Section 3.03 — Capitalization
(a) The authorized capital stock of the Company consists solely of the number of shares of common stock and preferred stock set forth on Schedule 3.03. As of the date hereof, the issued and outstanding capital stock of the Company is owned as follows:
(b) All of the Shares are duly authorized, validly issued, fully paid, and nonassessable and were issued in compliance with applicable securities laws. None of the Shares are subject to, or were issued in violation of, any preemptive rights, rights of first refusal, rights of first offer, or similar rights.
(c) Except as set forth on Schedule 3.03, there are no outstanding (i) options, warrants, calls, puts, convertible securities, exchangeable securities, or other rights, agreements, or commitments obligating the Company to issue, deliver, sell, repurchase, or redeem, or cause to be issued, delivered, sold, repurchased, or redeemed, any shares of capital stock or other equity interests of the Company, or (ii) stock appreciation rights, phantom equity interests, profit interests, or similar rights with respect to the Company. Schedule 3.03 sets forth a true, correct, and complete description of the Company's stock option plan, including the total number of shares reserved for issuance thereunder, the number of options granted and outstanding (both vested and unvested), the applicable exercise prices, and the identity of each option holder. All vested option holders are included within the "Other Management and Employee Stockholders" category on Schedule A for purposes of determining Pro Rata Portions.
(d) There are no outstanding contractual obligations of the Company to repurchase, redeem, or otherwise acquire any shares of capital stock of the Company or to provide funds to, or make any investment (in the form of a loan, capital contribution, or otherwise) in, any Person.
Section 3.04 — No Conflicts; Consents
(a) Except as set forth on Schedule 3.04, the execution, delivery, and performance by the Company of this Agreement and the consummation of the Transactions do not and will not (i) conflict with, violate, or result in a breach of any provision of the certificate of incorporation or bylaws of the Company, (ii) conflict with, violate, or result in a breach of, or constitute a default (or an event that, with the giving of notice, lapse of time, or both, would constitute a default) under, or give rise to any right of termination, cancellation, modification, acceleration, or any Lien under, any Contract to which the Company is a party or by which the Company or any of its assets or properties is bound, (iii) violate or result in a breach of any applicable law, statute, rule, regulation, Order, or other legal requirement applicable to the Company or any of its assets or properties, or (iv) require the Company to obtain any Consent of, or make any filing or registration with, any Governmental Authority, other than (A) applicable filings and notices under the HSR Act and (B) such Consents, filings, or registrations the failure of which to be obtained or made would not, individually or in the aggregate, reasonably be expected to have a Company Material Adverse Effect.
(b) Schedule 3.04 identifies all Consents required to be obtained from third parties in connection with the change of control resulting from the Transactions, including approximately thirty-four (34) Contracts containing change of control provisions requiring consent, waiver, or notice upon consummation of the Transactions. Key contracts requiring consent include, without limitation, agreements with Pinnacle Cloud Solutions Inc., Redline Freight Corp., Arcwave Software LLC, Congress Tower Partners LP (Austin headquarters lease), Stratton Digital Media Inc., PayStream Financial Technologies Inc., Ashford Savings Bank, N.A., and various fulfillment center landlords. The HSR Act filing is required as described in Section 6.03.
Section 3.05 — Financial Statements
(a) The Company has delivered to Buyer true, correct, and complete copies of the following financial statements (collectively, the "Financial Statements"): (i) the audited consolidated balance sheets of the Company as of December 31, 2022, December 31, 2023, and December 31, 2024, and the related audited consolidated statements of income, stockholders' equity, and cash flows for the fiscal years then ended, together with the notes thereto and the report of the Company's independent registered public accounting firm thereon (the "Audited Financial Statements"); and (ii) the unaudited consolidated balance sheet of the Company as of March 31, 2025, and the related unaudited consolidated statements of income and cash flows for the three-month period then ended (the "Interim Financial Statements").
(b) The Financial Statements (including the notes thereto) have been prepared in accordance with GAAP applied on a consistent basis throughout the periods indicated (except as may be indicated in the notes thereto and, with respect to the Interim Financial Statements, subject to normal year-end adjustments that are not, individually or in the aggregate, material in amount, and the absence of footnotes) and fairly present, in all material respects, the consolidated financial condition, results of operations, and cash flows of the Company and its Subsidiaries as of the respective dates thereof and for the respective periods covered thereby. For the fiscal year ended December 31, 2024, the Company's revenue was $891,000,000, earnings before interest, taxes, depreciation, and amortization ("EBITDA") was $134,000,000, and gross merchandise volume ("GMV") was $6,200,000,000.
(c) Except as set forth on Schedule 3.05, the Company has no liabilities or obligations (whether accrued, contingent, absolute, determined, determinable, or otherwise) that would be required to be reflected on a balance sheet of the Company prepared in accordance with GAAP, except for (i) liabilities reflected or reserved against on the Company's audited balance sheet as of December 31, 2024 (the "Balance Sheet Date"), (ii) liabilities incurred in the ordinary course of business consistent with past practice since the Balance Sheet Date that are not, individually or in the aggregate, material in amount, liabilities arising under or in connection with this Agreement and the
Section 3.06 — Absence of Certain Changes
Since December 31, 2024, except as set forth on Schedule 3.06 or as expressly contemplated by this Agreement, the Company has conducted the Business in the ordinary course consistent with past practice in all material respects, and there has not been any event, change, effect, development, condition, circumstance, or occurrence that, individually or in the aggregate, has had or would reasonably be expected to have a Company Material Adverse Effect.
Section 3.07 — Compliance with Laws
(a) The Company is, and since January 1, 2022 has been, in compliance in all material respects with all applicable laws, statutes, rules, regulations, Orders, and other legal requirements of any Governmental Authority applicable to the Company or the Business. The Company has not received any written notice from any Governmental Authority alleging any material noncompliance with any such applicable law.