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1 TODD A. ROBERTS (SBN 129722)
NICOLE S. HEALY (SBN 157417)
2 EDWIN B. BARNES (SBN 295454)
ROPERS, MAJESKI, KOHN & BENTLEY ELECTRONICALLY
3 1001 Marshall Street, Suite 500
Redwood City, CA 94063
F I L E D
Superior Court of California,
4 Telephone: (650) 364-8200 County of San Francisco
Facsimile: (650) 780-1701 06/02/2020
5 Email: todd.roberts@ropers.com Clerk of the Court
nicole.healy@ropers.com BY: WILLIAM TRUPEK
Deputy Clerk
6 edwin.barnes@ropers.com
7 Attorneys for Defendant and Cross-Complainant
GETAROUND, INC., and Defendants SAM
8 ZAID, and ADAM KOSMICKI
9 SUPERIOR COURT OF THE STATE OF CALIFORNIA
Bentley
10 COUNTY OF SAN FRANCISCO
11
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12 GEOFFREY SHMIGELSKY, CASE NO. CGC-19-572740
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13 Plaintiff, GETAROUND, INC’S SECOND
AMENDED CROSS-COMPLAINT
Majeski
14 v.
15 GETAROUND, INC., LEO GRANT, Action Filed: January 14, 2019
ADAM KOSMICKI, SAM ZAID, ILAN
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16 KROO, KASRA MAFTOON,
MOHAMED ZAID, and TARIQ ZAID
17
Defendants.
18
19 GETAROUND, INC.
20
Cross-Complainant,
21
v.
22
GEOFFREY SHMIGELSKY, an individual,
23 and DOES ONE through TWENTY,
inclusive,
24
Cross-Defendants.
25
26
27 Defendant and Cross-Complainant GETAROUND, INC. (“Getaround” or the
28 “Company”), hereby alleges as follows:
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SECOND AMENDED CROSS-COMPLAINT OF DEFENDANT AND CROSS-COMPLAINANT GETAROUND, INC.
1 I.
PREFACE
2
1. This dispute arises out of Plaintiff and Cross-Defendant’s Geoffrey Shmigelsky’s
3
(“Plaintiff” or “Cross-Defendant”) seller’s remorse and refusal to accept responsibility for his
4
own actions.
5
2. Shmigelsky was an early investor in Defendant and Cross-Complainant
6
Getaround and laments that he cashed out too soon because of his lack of foresight and patience.
7
3. Rather, enticed by the prospect of making a stunning return on the last of his
8
Getaround investment, he explained to the Company’s Chief Executive Officer Sam Zaid that he
9
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was going to sell the last 300,000 of his shares because “it was time for [him] to do something
10
else.”
11
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4. Not long after Shmigelsky made that announcement, Getaround achieved
&
12
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successes for which Shmigelsky congratulated Getaround while still electing to cash out his
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shares, even though he confessed that even then, he already was having seller’s remorse.
Majeski
14
5. Months later, Getaround secured a major investment from SoftBank that dwarfed
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all of its previous fundraising rounds.
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6. It was only then that Shmigelsky could no longer accept his own lack of foresight
17
for selling too soon, and instituted this action blaming his own poor investing choices on his
18
former friends, colleagues, and advisees with preposterous and unsupported allegations of
19
collusion.
20
7. Shmigelsky’s wild allegations revealed something Getaround never could have
21
expected – Shmigelsky deceived it every time he sold his stock because he believed he, as a
22
friend and early investor, was entitled to insider information and advice to help him time and
23
price the sales of his Getaround stock.
24
8. Getaround brings this Cross-Claim because it has no choice but to bind
25
Shmigelsky to his own promises made to Getaround to induce it to waive its absolute transfer
26
restriction so he could transfer his stock at the prices he negotiated, in transfers he proposed, but
27
which Getaround had no duty, obligation, or imperative to authorize.
28
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SECOND AMENDED CROSS-COMPLAINT OF DEFENDANT AND CROSS-COMPLAINANT GETAROUND, INC.
1 II.
INTRODUCTION
2
3 9. As a result of his early investments in and role as an advisor to Getaround,
4 beginning at its creation in 2009, Shmigelsky acquired substantial holdings of Getaround
5 preferred and common stock at bargain-basement prices.
6 10. In 2014, after an option vested, Shmigelsky desired to start liquidating his
7 investments for a profitable exit.
8 11. However, Getaround was and is a privately-held company, there is no market for
9 its stock, and Shmigelsky was prohibited from selling his stock to any person and taking any
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10 profits whatsoever because his shares were encumbered by a transfer restriction.
11 12. The transfer restriction prohibited him from transferring his stock to any other
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12 person without Getaround’s express written waiver of that restriction as a party to a contract to
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13 transfer ownership of the shares. Thus, no matter how badly Shmigelsky wanted to sell and
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14 regardless of the price, and no matter how much anyone wanted to buy his stock, he could not
15 transfer his shares in a two-party, buyer-seller transaction.
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16 13. For any proposed sale, Shmigelsky and the transferee had to enter into a three-
17 party stock transfer agreement by making Getaround a limited party to such contract so that it
18 could waive the transfer restriction.
19 14. Getaround did not and does not waive its transfer restriction lightly. In
20 consideration for the waiver, Getaround required: (a) that Shmigelsky hold Getaround and its
21 officers and directors harmless from any and all liability arising out of his proposed stock
22 transfers; (b) that Shmigelsky indemnify Getaround and its officers and directors for any costs,
23 including legal costs, resulting from any disputes arising out of his proposed stock transfers; and,
24 (c) that Shmigelsky promise the Company that he was not relying on the Company or its directors
25 and officers to provide him information, update old information, or otherwise advise him on his
26 proposed transfers.
27 15. Getaround does not receive any other consideration for its waiver of the transfer
28 restriction.
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SECOND AMENDED CROSS-COMPLAINT OF DEFENDANT AND CROSS-COMPLAINANT GETAROUND, INC.
1 16. Getaround never would have allowed Shmigelsky to consummate any of his
2 proposed stock transfers unless Shmigelsky promised not to sue Getaround or its officers and
3 directors and unless Shmigelsky promised to indemnify Getaround and its officers and directors
4 from any lawsuit or claim from any person.
5 17. Getaround never would have allowed Shmigelsky to consummate any of his
6 proposed stock transfers unless he represented and warranted that he was not relying on the
7 Company for new information, updated information, old information, or information of any kind
8 about the Company, its business, its fundraising, or its stock.
9 18. Getaround would have refused to waive its transfer restriction for Shmigelsky (or
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10 any other investor) if it had the slightest inclination that he was relying on the Company for
11 information of any kind, to advise him on the price or timing of his proposed transfers, or if it
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12 thought he would consider not holding it harmless, not indemnifying it, or suing it for allowing
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13 the very transfers he proposed.
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14 19. Every time Shmigelsky proposed to transfer his stock to another person, he knew
15 he needed to makes the above promises and representations to Getaround or it would not allow
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16 his proposed transfer to proceed, and accordingly, he made those promises, representations, and
17 warranties time and time again.
18 20. He also knew that if he refused to make those promises and representations,
19 Getaround would not permit him to go forward with his proposed stock transfer.
20 21. When Shmigelsky desired to take his profits by transferring his stock to third
21 parties, Shmigelsky made those promises to Getaround, Getaround waived its transfer
22 restrictions, and Shmigelsky took his profits.
23 22. Between 2014 and 2016 Shmigelsky liquidated all but 300,000 shares of his
24 Getaround common stock for substantial profits.
25 23. At some point, he even enlisted a broker, Mark Sullivan at Rainmaker Securities,
26 LLC, to help him place the last of his shares because there was no market for his non-transferable
27 private stock.
28
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SECOND AMENDED CROSS-COMPLAINT OF DEFENDANT AND CROSS-COMPLAINANT GETAROUND, INC.
1 24. In January 2019, Shmigelsky informed Getaround that he had found two venture
2 capital firms (“VCs”) to which he proposed to transfer the last of his shares.
3 25. After negotiating with the VCs, in March 2019 Shmigelsky proposed to Getaround
4 that he transfer his shares to the VCs for $1.80/share – the highest price and greatest return he
5 would receive on any of his transfers of his Getaround stock.
6 26. Getaround held an assignable right-of-first-refusal (“ROFR”) over his proposed
7 transaction, which it assigned to five alternate purchasers (Leo Grant, Kasra Maftoon,
8 Mohammed Zaid, Ilan Kroo, and Tariq Zaid) at Shmigeksly’s proposed $1.80/share price.
9 27. Knowing full well who the ROFR recipients were, Shmigelsky elected to proceed
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10 with the proposed transfer.
11 28. Accordingly, Shmigelsky needed to induce Getaround to waive its transfer
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12 restriction.
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13 29. Shmigelsky entered into stock transfer agreements (“STA”) with each of the
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14 purchasers and Getaround to consummate the transfers he negotiated and that he proposed at
15 $1.80 per share.
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16 30. In the STAs Shmigelsky promised (a) that he would hold Getaround and its
17 officers and directors harmless from any and all liability arising out of his proposed stock
18 transfers; (b) that he would indemnify Getaround and its officers and directors for any costs,
19 including legal costs, resulting from any disputes arising out of his proposed stock transfers; and,
20 (c) that he was not relying on the Company or its directors and officers to provide him
21 information, update old information, or otherwise advise him on his proposed transfers.
22 31. Had Shmigelsky not made those promises, representations, and warranties
23 Getaround would not have allowed him to proceed with his proposed transfers regardless of the
24 assignment of the ROFR.
25 32. These promises were the essential and sole consideration for Getaround’s
26 performance of waiving its transfer restriction.
27
28
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SECOND AMENDED CROSS-COMPLAINT OF DEFENDANT AND CROSS-COMPLAINANT GETAROUND, INC.
1 33. Shmigelsky knew from prior experience in selling his stock that if he did not make
2 those promises, representations, and warranties, Getaround would have not allowed the
3 transaction to proceed.
4 34. However, when he signed the STAs in April of 2018 with each purchaser and
5 Getaround, Shmigelsky assumed, intended, believed, and expected that he would obtain non-
6 public, confidential information from Getaround’s management based on his long standing
7 relationships with them and the fact that previously, when he was a preferred shareholder and
8 advisor, Getaround and its management had kept him apprised of fundraising and non-public
9 information. He also assumed that Getaround would endeavor to provide him or his VCs
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10 additional non-public, confidential information after Getaround talked with the VCs in February
11 of 2019.
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12 35. Contrary to his representations, Shmigelsky assumed and expected that the VCs
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13 with whom he was negotiating would share with him all of the information Getaround shared
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14 with them, and would use that information to offer him a price for the shares he was attempting to
15 sell that incorporated non-public positive information about the Company into the share price.
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16 36. Accordingly, when Shmigelsky entered into each STA he believed that he would
17 be the beneficiary of any inside, material, non-public information regarding Getaround.
18 37. Thus, when Shmigelsky signed the April 2018 STAs and made those promises,
19 representations, and warranties identified above, they were false, he knew they were false, and he
20 made such false promises, representations, and warranties because he knew that if he did not,
21 Getaround would not waive the transfer restriction.
22 38. His motivation for making those false promises, representations, and warranties to
23 induce Getaround to waive the transfer restriction and permit him to sell his shares, was so he
24 could cash out the last of his investment rather than continue to take the risk that Getaround
25 would not continue to succeed.
26 39. When he signed the April 2018 STAs, Shmigelsky expected, intended, and
27 believed that Getaround would supply him and the VCs with confidential non-public information
28 about the Company.
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SECOND AMENDED CROSS-COMPLAINT OF DEFENDANT AND CROSS-COMPLAINANT GETAROUND, INC.
1 40. Shmigelsky even contends in his lawsuit that Getaround, its Chief Executive
2 Officer Sam Zaid (“Zaid”), and Chief Financial Officer Adam Kosmicki (“Kosmicki”) had a duty
3 to disclose or update him on what he referred to as non-public “highly material events.”
4 41. In his Second Amended Complaint (“SAC”) in this action, Shmigelsky admitted
5 that his representations and warranties to Getaround in the STAs were false, “[b]ecause
6 Getaround did not make Plaintiff’s interested buyers aware of Getaround’s imminent C-1
7 financing round or Getaround’s current valuation, they were unable to pass along any information
8 on those topics to Mr. Shmigelsky, or to factor those highly material events into the valuation of
9 Plaintiff’s shares.” (Shmigelsky SAC ¶ 50, herein incorporated by reference.)
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10 42. Thus, Shmigelsky’s representations and warranties in the April 2018 STAs that he
11 was aware that Getaround had no obligation to supply him with complete information, updated
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12 information, or indeed any information in connection with the April 2018 sales of his shares was
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13 false, he knew it was false when he made them, and he did so to induce Getaround to waive its
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14 transfer restriction.
15 43. By signing the STA, Shmigelsky intended to and did deceive and defraud
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16 Getaround into believing that he intended to honor its terms and would not rely on the
17 completeness or accuracy of the information the Company provided to him.
18 44. That was not true. In fact, Shmigelsky intended to rely on the completeness of the
19 information available to him (and to his buyers) in deciding to sell his shares at $1.80/share.
20 45. Moreover, Shmigelsky falsely represented to Getaround that he would “defend,
21 indemnify and hold harmless the Company, its directors and officers . . . from and against, and
22 shall compensate and reimburse each of the Indemnitees for, any and all claims, losses, damages,
23 liabilities, demands, suits, . . . attorneys’ fees and expenses of any nature.” Shmigelsky did so to
24 induce Getaround to release the transfer restriction on the stock to permit him to sell it to the
25 purchasers.
26 46. His claim that he was damaged by his own proposed stock transfer is not only
27 false and illogical, but terribly ironic in that the transfer would have never happened but for
28 Shmigelsky’s deceiving Getaround into waiving the transfer restriction.
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SECOND AMENDED CROSS-COMPLAINT OF DEFENDANT AND CROSS-COMPLAINANT GETAROUND, INC.
1 47. Getaround has been harmed by Shmigelsky’s actions because it has had to defend
2 not only itself, but also Messrs. Zaid and Kosmicki in Shmigelsky’s lawsuit.
3 III.
THE PARTIES
4
5 48. Defendant and Cross-Complainant Getaround, Inc. (“Getaround” or “Cross-
6 Complainant”) is, and at all times relevant to this action was, a privately-held Delaware
7 corporation with its principal place of business in San Francisco County, California.
8 49. Upon information and belief, Plaintiff and Cross-Defendant Geoffrey Shmigelsky
9 (“Shmigelsky” or “Cross-Defendant”) is, and at all times herein mentioned was, an individual
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10 residing in Canada.
11 50. The true names and capacities of Cross-Defendants sued herein as Roe 1 through
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12 Roe 20, inclusive, are currently unknown to Cross-Complainant, who therefore sues said Cross-
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13 Defendants, and each of them, by such fictitious names. Cross-Complainant will seek leave of
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14 this Court to amend this Cross-Complaint to allege their true names and capacities once they have
15 been ascertained.
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16 IV.
JURISDICTION AND VENUE
17
18 51. The Court has jurisdiction over this entire action by virtue of the fact that this is a
19 civil action wherein the matter in controversy, exclusive of interest, exceeds $25,000.
20 52. The Court has jurisdiction over this Cross-Complaint against Cross-Defendant
21 Shmigelsky pursuant to California Code of Civil Procedure section 428.10, as the claims arise out
22 the same Stock Transfer Agreements, transactions, and occurrences that are the subject matter of
23 Cross-Defendant Shmigelsky’s October 20, 2019 Second Amended Complaint, portions of which
24 are cited to and incorporated by reference herein, as discussed below.
25 53. Venue is proper in the Superior Court for the County of San Francisco pursuant to
26 California Code of Civil Procedure section 395 because the acts and omissions complained of
27 herein took place and caused damages and other adverse effects upon Defendant and Cross-
28 Complainant within the territorial jurisdiction of this Court.
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SECOND AMENDED CROSS-COMPLAINT OF DEFENDANT AND CROSS-COMPLAINANT GETAROUND, INC.
1 V.
FACTUAL ALLEGATIONS
2
A. Geoffrey Shmigelsky
3
4 54. Geoffrey Shmigelsky is a well-educated, sophisticated investor, successful
5 entrepreneur, and computer programmer.
6 55. He attended the University of Calgary from 1987-1992 obtaining a B.Sc. in
7 Computer Science, and later engaged in graduate studies in genetics and bioinformatics there
8 from 2001-2002. He obtained a master’s degree from the Georgia Institute of Technology in
9 Computer Science in 2017 with a 4.0 GPA. And, he also obtained five nanodegrees (artificial
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10 intelligence, deep learning, reinforcement learning, and artificial intelligence in finance) from
11 Udacity, an online educational company, between 2017 and 2019.
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12 56. In 1990, Shmigelsky founded CADVision, which in 2000 was acquired by PSINet
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13 Canada for a “serious exit” in the process, earning an Entrepreneur of the Year award in 2000, a
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14 place on the Top 40 under 40 three times, and was listed as one of Alerta’s 50 Most Influential.
15 (http://www.cadvisionlegacy.com/CADVision/Welcome.html.) He later explained on the 11th
Anniversary of the sale, the “serious exit” of CADVision gave him “the freedom to choose [his]
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17 projects” (https://twitter.com/gShmigelsky/status/55524041372614656.)
18 57. After his exit from CADVision, Shmigelsky went on to become an angel investor,
19 that is, an investor who provides funding to early-stage companies, as the Founder and CEO of an
20 angel investment company, Think Exponential. Through Think Exponential, he invested in
21 projects including as an Associate Founder of Singularity University (a technology incubator, that
22 is an organization that assists early-stage companies with their initial development, through which
23 he became Getaround’s first investor); the Sole Investor and Partner for CureTogether (acquired
24 by 23andMe in July 2012); the Lead Investor at Androcyte; and the Lead Investor and Advisor
25 for Getaround as part of a portfolio of at least sixteen reported companies
26 (http://www.shmigelsky.com/Geoffrey_Shmigelsky/Invest.html; https://angel.co/p/geoffrey-
27 shmigelsky; https://thinkexponential.com/about/who-we-are/.)
28
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SECOND AMENDED CROSS-COMPLAINT OF DEFENDANT AND CROSS-COMPLAINANT GETAROUND, INC.
1 58. On his LinkedIn page, Shmigelsky advertises that he spent ten years ears as CEO
2 of CADVision, fourteen years as CEO of Think Exponential, and seven years as CEO of
3 Appetica, in addition to currently serving as an AI Evangelist at OneCup AI and BioConversion
4 Databank.
5 59. Shmigelsky is a sophisticated entrepreneur, familiar with illiquid private company
6 stock, with many years’ experience in investing and profiting from investing in technology start-
7 ups.
8 60. Shmigelsky is not only generally sophisticated and experienced with illiquid,
9 private company stock, but also has personal, particularized experience with Getaround private
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10 stock, the non-existence of a market for the stock, and of Getaround exacting prohibitive
11 conditions on which it will consider waiving its transfer restriction to allow an early investor,
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12 such as Shmigelsky, to transfer shares to an outsider for a profit.
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13 B. Getaround
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14 61. In 2009 Sam Zaid, Jessica Scorpio, and Elliot Kroo met at a start-up incubator,
15 Singularity University, where they conceived of Getaround.
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16 62. Shmigelsky, though his position as an Associate Founder of Singularity, became
17 Getaround’s lead and earliest investor.
18 63. Getaround, a Delaware corporation founded in 2009, is now the leading global car
19 sharing platform.
20 64. Since 2009, Getaround has raised investment capital through the sale of
21 Convertible Notes (which converted into Series A Preferred Stock), Series A Preferred Stock,
22 Series B Preferred Stock, Series C Preferred Stock, Series C-1 & C-2 Preferred Stock (which
23 converted into Series D Preferred Stock), Series D Preferred Stock, and Series D-1 & D-2
24 Preferred Stock (which also converted into Series D Preferred Stock).
25 C. Getaround’s Three-Party Stock Transfer Contracts
26 65. Getaround is a privately-held company. Getaround’s stock, both common and
27 preferred, has not, does not, and cannot trade freely on any secondary market because
28
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SECOND AMENDED CROSS-COMPLAINT OF DEFENDANT AND CROSS-COMPLAINANT GETAROUND, INC.
1 Getaround’s Board of Directors has the right to refuse the proposed transfer of its stock from the
2 holder to any other person, that is, all of its shares are “Restricted Shares.”
3 66. In order for a Getaround shareholder to transfer Getaround stock to another person,
4 the shareholder must first seek Getaround’s written approval. If the company approves the
5 transfer, then the transferee, transferor, and Getaround must enter into a three-party contract, a
6 Stock Transfer Agreement (“STA”).
7 67. Getaround is a limited, but necessary party to these three-party contracts because
8 the two parties proposing the transfer of the Restricted Shares must obtain Getaround’s consent to
9 the transfer.
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10 68. Any transfer conducted without the approval of Getaround’s Board of Directors is
11 null and void and has no force or effect.
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12 69. In exchange for its consent to the transfer of its shares between a stockholder and
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13 some other person, and for the waiver of the transfer restriction on its shares, and certain other
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14 agreements, Getaround receives no cash consideration.
15 70. Instead, both Transferor and Transferee must make certain representations,
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16 acknowledgements and promises to the Company as consideration, including the following:
17 a. Transferor and Transferee acknowledge and agree that the information
provided by the Company to Transferor and Transferee was provided as a
18 convenience to Transferor and Transferee and each agrees not to make any
claim against the Company in connection therewith. The Company
19 disclaims any obligation (and undertakes no obligation) to update or
correct such information, which may not be accurate or complete, and
20 Transferor and Transferee acknowledge and agree that the Company is not
obligated to (and may not) provide any further information to Transferor
21 or Transferee.
22 b. The Transferor and Transferee promise to severally, and not jointly,
defend, indemnify, and hold harmless Getaround, its directors, and its
23 officers (“Indemnitees”) for any and all claims, losses, damages,
liabilities, demands, suits, settlements, charges, costs, judgments, awards,
24 fines, penalties, fees, attorneys’ fees and expenses of any nature incurred
by the Indemnitees regardless of its relation to a third party claim arising
25 in any part from inaccuracy or breach of any representation, warranty,
covenant or obligation of the Transferor or Transferee in the stock transfer
26 contract.
27
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SECOND AMENDED CROSS-COMPLAINT OF DEFENDANT AND CROSS-COMPLAINANT GETAROUND, INC.
1 71. These promises and representations are material to Getaround’s decision whether
2 to agree to lift the transfer restrictions on its stock. If the Transferor and Transferee do not make
3 these promises and representations, Getaround will not give its consent to the transfer and a
4 proposed stock transfer may not proceed.
5 D. Shmigelsky’s Investment History with Getaround
6 72. As explained above, Shmigelsky has a long history and in-depth familiarity with
7 Getaround. He was Getaround’s first investor and a consultant to the Company from its inception
8 at Singularity University.
9 73. Shmigelsky invested $250,000 in Getaround Convertible Notes in 2009. Pursuant
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10 to their terms, those Notes converted to Series A Preferred Stock at a substantial discount to the
11 Series A Preferred Stock offering price. Shmigelsky also purchased Common Stock in 2014 by
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12 exercising a stock option giving him the right to buy Common Stock from Getaround at ten cents
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13 ($0.10) per share.
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14 74. Shmigelsky acquired 338,010 shares of Series A Preferred Stock through the
15 Convertible Note at $0.7396 per share, which he sold in four (4) STAs between 2013 and 2015
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16 for $1.0224 per share, clearing a profit of $95,589.23 (a 38.23% return) on his original investment
17 of $250,000 in Getaround’s Convertible Notes.
18 75. Shmigelsky also acquired 577,500 shares of Getaround Common Stock for ten
19 cents ($0.10) cents per share (for an aggregate purchase price of $57,750) which he sold in eight
20 (8) STAs between 2014 and 2018 for prices of $1.50 per share (193,333 shares in 2014-2015);
21 $1.70 per share (84,167 shares in 2016); and $1.80 per share (300,000 shares in 2018); clearing a
22 profit of $915,333.40 (a staggering 1,585% return) on his $57,750 purchase of Common Stock.
23 76. In the course of his dealings with the Company, Shmigelsky has entered into
24 multiple contracts with Getaround including, but not limited to a Convertible Note Purchase
25 Agreement in 2009 (Note Agreement); a Warrant Agreement in 2009; a Warrant Termination
26 Agreement in 2010; a Consulting Agreement in 2010; a Confidential Information and Invention
27 Assignment Agreement (Confidentiality Agreement) in 2010; three (3) Option Exercise
28 Agreements (“OEAs”) in 2014; and twelve (12) Stock Transfer Agreements (four (4) Preferred
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SECOND AMENDED CROSS-COMPLAINT OF DEFENDANT AND CROSS-COMPLAINANT GETAROUND, INC.
1 Stock Transfer Agreements “PSTAs” and eight (8) Common Stock Transfer Agreements
2 “CSTAs”) between 2013 and 2018.
3 77. In the course of these dealings, Shmigelsky has made multiple representations,
4 warranties, and promises which Getaround relied on when dealing with him including, but not
5 limited to:
6 a. that Getaround’s role with respect to the stock transfer agreements was
narrowly defined and limited by the terms of those agreements;
7
b. that he agreed that “no Purchaser … shall be liable to any other Purchaser for
8 any action heretofore or hereafter taken or mitted to be taken by any of them in
connection with the purchase of the Securities.” (May & October 2013 Series A
9 PSTA ¶ 3.10.);
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10 c. that he agreed that he “does hereby release and forever discharge the
Company … directors, [and] officers … from any and all claims, demands, causes of
11 action, obligations, damages, losses, liabilities, contracts, agreements, promises,
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debts, costs and expenses of any kind whatsoever … which such party ever had, now
12
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has, or may claim to have against the Company, relating to or arising from the
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transfer and sale of the Shares.” (May & October 2013 and January 2015 Series A
13 PSPA Release ¶ 8(a); August 2015 CSTA ¶ 9.);
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14 d. After acknowledging his familiarity and understanding of California Civil
Code section 1542, and with the advice of legal counsel, Shmigelsky represented that
15 he “elects to and does assume all risk for Claims known or unknown, suspected or
unsuspected, heretofore arising from the subject of Section 8.” (Id., Release ¶ 8(b).);
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16
e. that he:
17
(i) is a sophisticated individual … familiar with transactions similar to
18 those contemplated by this Agreement and has such knowledge and
experience in financial and business matters as to be capable of evaluating
19 the merits, risks, and suitability of the transactions contemplated by this
Agreement, (ii) has adequate information concerning the business and
20 financial condition of the Company to make an informed decision
regarding the sale of the Shares, (iii) has negotiated the terms of this
21 Agreement (including the Purchase Price) on an arm’s length basis … (iv)
has independently and without reliance upon Transferee or the Company
22 for and information or advice regarding the Company or the value of the
Shares, and based on such information and the advice of such advisors of
23 the as Transferor deemed appropriate, made its own analysis and decision
to enter this Agreement.
24
f. and that he further was:
25
fully aware of the possibility that the value of the Shares may significantly
26 appreciate or depreciate over time and by agreeing to sell the Shares
pursuant to this Agreement, Transferor is giving up the opportunity to
27 sell the Shares at a higher price in the future …Transferor acknowledges
that (x) Transferee currently may have, and later may come into
28 possession of information with respect to with respect to the Company that
4831-1992-4671.1
- 13 -
SECOND AMENDED CROSS-COMPLAINT OF DEFENDANT AND CROSS-COMPLAINANT GETAROUND, INC.
1 is not known to Transferor and that may be material to a decision to sell
the Shares (“Transferor Excluded Information”), and (y) Transferor has
2 determined to sell the Shares notwithstanding its lack of knowledge of
the Transferor Excluded Information. Transferor understands that the
3 other Parties hereto will rely on the accuracy and truth of the foregoing
representations, and Transferor hereby consents to such reliance.
4
5 (January 2015 Series A PSTA ¶ 4.7; August 2015 CSTA ¶ 3(d); November & March 2016 CSTA
6 ¶ 3(d).) (emphasis added.)
7 g. that he:
8 agrees to defend, indemnify and hold harmless the Company, its
directors and officers (the “Indemnitees”), from and against, and shall