AGREEMENT AND INSTRUMENT OF PURCHASE AND SALE
This agreement and instrument of purchase and sale (herein
"Instrument") entered into as of the 24th day of May, 1996 ("Instrument Date")
is by and between ST Microwave Corporation, a Delaware corporation with its
principal offices at 000 Xxxxxxx Xxxxxx, Xxxxxxxxx, Xxxxxxxxxx, 00000 ("Seller")
and Communications & Power Industries, Inc., a Delaware corporation, operating
through its Satcom Division located at 0000 Xxxxxxx Xxxxx Xxxxx, Xxxxx Xxxxx,
Xxxxxxxxxx, 00000 ("Buyer").
Subject to all of the terms and conditions of this Instrument, the
parties hereto represent, warrant, sell, assume and agree as follows:
1. Sale of Assets
Seller hereby sells, assigns and transfers to Buyer, and Buyer hereby
buys and accepts from Seller, all of Seller's right, title and interest in the
following assets (collectively "Assets") of Seller's Benecia Communications
Division ("Transceiver Business") whose business is the design, manufacture, and
sale of radio frequency transceivers ("Transceivers").
1.1 Equipment. All machinery, tooling, appliances, equipment (including
essential replacement parts), other tangible personal property of every
kind and description owned or leased by Seller and primarily utilized
by Seller in operation of the Transceiver Business and any transferable
supplier warranty rights related thereto, if any, (collectively
"Equipment"). A summary of Equipment as of _____________ is attached as
Exhibit 1.1.
1.2 Inventories. All of Seller's supplies and inventories of finished
parts, raw materials, work in process, and finished goods with respect
to the Transceiver Business as of the Instrument Date (collectively
"Inventories"). A summary of Inventory as of __________ is attached
as Exhibit 1.2.
1.3 Other Contracts and Open Bids. All other purchase orders
(acknowledged or otherwise), open bids, orders resulting from open
bids, contracts, claims against other parties (including without
limitation unliquidated rights under manufacturers' or vendors'
warranties or guarantees), rights under commitments, unbilled
receivables, down payments, progress or advance payments already
received and portions already deducted by the customer from the
xxxxxxxx related to sales contracts specifically assumed by Buyer
pursuant to this Instrument, and other agreements and licenses, if any,
of Seller relating primarily to the Transceiver Business on the
Instrument Date ("Contracts"). A definitive backlog list of open
purchase orders and contracts as of ______________ is attached as
Exhibit 1.3.
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1.4 Books and Records. Except those books, records and documents which
Seller is legally required to retain (copies of which have been and
will be provided to Buyer and made available to Buyer for inspection
and review during reasonable business hours), all records of the
Transceiver Business relating to any or all of the above-described
Assets or the operation of the Transceiver Business, including but not
limited to all trade secrets, engineering drawings, product design,
computer design data and programs, blueprints, specifications,
technical documentation, memoranda, data, marketing information and
customer lists related to the products designed, manufactured or sold
by the Transceiver Business.
1.5 Licenses. A fully paid up license to utilize all patents, trade
secrets and designs owned by Signal Technologies Corporation and any
Division or Subsidiary thereof which are necessary for the continuing
development, production, and support of the Transceiver Business.
1.6 Other Nonexcluded Assets. It is the intent of the parties that the
entire operation assets of the Transceiver Business shall be sold and
transferred to Buyer hereunder. Therefore, in the event that it is
discovered that other assets or properties possessed and used by Seller
primarily in the Transceiver Business of the type intended to be sold
and transferred hereunder are not reflected on the exhibits attached
hereto, such other assets and properties shall be deemed sold to Buyer
as Assets hereunder and Seller shall take such action as may be
necessary to transfer title thereof to Buyer.
1.7 No Other Assets or Rights Transferred to Buyer. Except as set forth
in Sections 1.1 through 1.6 above, nothing in this Agreement shall be
construed as conferring on Buyer, and Buyer shall not acquire hereby,
any right, title or interest to or in any other property or assets of
Seller, whether tangible or intangible. Buyer shall not have any right,
title or interest in or to the operation, products, property, patents,
technology, know-how, cash, cash equivalents, financial resources,
insurance coverages, management services or assets of Seller which are
not Assets as described herein, nor any others specifically excluded
herein, and Buyer shall not have any right, title or interest in or to
any other operation, subsidiary or division of Seller.
Buyer shall not acquire any right, title or interest in or right to use
the name "Benecia Communications" or any other trademarks or trade
names of Seller.
2. Payment
As consideration of the Assets purchased by Buyer pursuant to this
Instrument, Buyer hereby assumes the liabilities described in Section 4 below
and hereby agrees to pay Seller in United States currency EIGHT HUNDRED THOUSAND
DOLLARS (US$800,000) ("Purchase Price") as follows:
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2.1 Payment Terms. Buyer shall pay to Seller the sum of $640,000 by
wire transfer within five days of the signing of this Agreement by both
parties, with the balance of $160,000 payable seven (7) working days
thereafter.
2.2 Purchase Price Allocation. Buyer shall provide Seller with the
allocation of Purchase Price within sixty (60) days of the Instrument
Date. The Purchase Price allocation shall be based upon the estimated
fair market value of the Assets acquired. Buyer and Seller agree to
comply with Section 1060 of the Internal Revenue Code of 1986 in making
the allocation of the Purchase Price among the Assets and in making all
necessary filing including but not limited to Section 1060.
3. Bulk Transfer Waiver
Buyer waives compliance with the requirements or provision of the bulk
transfer laws of any state or jurisdiction in which the Assets are located or
are to be transferred, including but not limited to the Uniform Commercial Code,
the Uniform Fraudulent Transfers Act and California Commercial Code Section 6101
et seq. In addition to the general indemnity provided under Section 10 hereof,
Seller specifically agrees to indemnify and save Buyer harmless against any and
all loss, claim, expenses or damage, including attorneys fees, arising out of
noncompliance with such bulk transfer laws.
4. Liabilities
Buyer hereby assumes all the liabilities and obligations of the
Transceiver Business as disclosed or referenced on the Exhibits identified in
this Section 4, and in accordance with the terms and conditions thereof and
below, as follows:
4.1 Sales and Service Contracts. All executory or partially executory
Contracts, including but not limited to offers and firm quotations of
Seller for the sale of Transceiver Products, Transceiver Parts or
Transceiver Services as described in Section 1.3 and/or listed in
Exhibit 1.3 and which remain executory or open in whole or in part on
the Instrument Date;
4.2 Purchases of Material and Supply Contracts. Each executory or
partially executory Contract for the purchase or lease of Equipment and
Inventories, limited to those for related goods, supplies, materials
and/or services for the manufacture and sale of Transceiver Products,
Transceiver Parts or Transceiver Services, as described in Section 1.3
and/or listed in Exhibit 1.3, and further including advance and
progress payment obligations, if any, on and after the Instrument Date.
Seller will deliver or make available to Buyer a complete and correct
list of purchase commitments as of the Instrument Date;
4.3 Post Closing Liabilities. All liabilities for or arising out of
operation of the Transceiver Business after the Instrument Date,
including but not limited to sales, service,
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warranty obligations and liability to third parties for bodily injury
or property damage relating to all Transceiver Products, parts and
services, sold, delivered or rendered by Buyer after the Instrument
Date; and
4.4 Excluded Liabilities. Except as expressly and specifically set
forth above in this Section 4 and in Sections 5,6,7,10, and 15 hereof,
Buyer assumes no liability for any obligation, commitment or liability
of Seller or the Transceiver Business, and Seller agrees that it shall
remain liable for all such unassumed obligations, commitments or
liabilities.
5. Assignment or Novation of Specific Contracts, Rights, Etc.
This Instrument shall not constitute an agreement to assign any right,
title or interest in, to or under any contract, license, lease, commitment,
sales, order, purchase order or other agreement or any claim or right to any
benefit arising under this Instrument or resulting from it if an attempted
assignment thereof, without the consent of a third party, would constitute a
breach thereof, or any way adversely affect the rights of Buyer or Seller under
this Instrument. This shall be true despite anything contained in this
Instrument to the contrary.
Each party shall use all reasonable efforts to assist the other in
seeking novation or consent to assignment to Buyer if the specific agreements
between Seller and third parties in all cases in which the consent of third
parties is required for novation or assignment. Buyer shall accept such novation
or assignment on the same terms as the existing contract. Buyer and Seller will
continue to cooperate with each other in good faith after the Instrument Date to
effectuate the assignment or novation of remaining such contracts and
obligations and the economic benefits thereof to Buyer. If such novation or
assignment cannot be made as aforesaid, Buyer shall perform the remaining
obligations under such contracts as a subcontractor to Seller and shall receive
the rights and benefits of Seller thereunder to the extent that such obligations
can be so subcontracted and such rights and benefits can be so assigned. All
agreements that may be required to be novated or assigned are included among the
Contracts identified in Section 1.3 and listed on Exhibit 1.3. To the extent any
such Contracts are not assigned, novated or subcontracted by Buyer's de facto
performance, Seller shall remain responsible for their performance.
6. Taxes
Buyer shall pay all sales, use, transfer and similar taxes arising out
of the transfer of Assets herein, but not any income taxes of Seller. Buyer
shall provide Seller with appropriate resale certificates. State and local real
and personal property taxes related to the Transceiver Business for the current
tax year shall be prorated between Buyer and Seller on the following basis:
Seller shall be responsible for payment of all such taxes for the period up to
and including the Instrument Date; and Buyer shall be responsible for payment of
all such taxes for the period from and after the Instrument Date. Any
supplemental property taxes or assessments which arise from the change in
ownership of the assets shall be the sole responsibility of Buyer. Buyer shall
not be
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responsible for any business, occupation, withholding or similar tax, or for any
taxes of any kind for any period prior to the Instrument Date. Seller shall not
be responsible for any business, occupation, withholding or similar tax, or for
any taxes of any kind for any period after the Instrument Date. Any payments due
from one party to the other pursuant to this Section 6 shall be paid on or
within thirty (30) days following the Instrument Date. If the current year's
taxes and assessments are not available as of the Instrument Date, for purposes
of apportionment between Buyer and Seller and payment pursuant to this Section
6, the amount thereof shall be estimated on the basis of the prior year's taxes
and assessments and any incremental payment shall be adjusted within fifteen
(15) days of receipt of the final tax statements.
7. Representations and Warranties of Buyer
Buyer represents and warrants that the following facts and
circumstances are as of the Instrument Date true and correct:
7.1 Buyer is a corporation, duly organized, validly existing in good
standing under the laws of Delaware, with corporate power and authority
to enter into this Instrument and to perform its obligations hereunder;
7.2 This Instrument constitutes a legal and binding obligation of
Buyer, enforceable in accordance with its terms;
7.3 The execution and delivery of this Instrument and the consummation
of the transaction described herein ("Transaction") by Buyer has been
duly authorized by all necessary corporate actions of Buyer and no
further corporate authorization is or will be necessary on the part of
Buyer; and
7.4 The execution, delivery and performance of this Instrument by buyer
will not violate any provision of, conflict with, result in a breach
of, constitute a default under, result in the acceleration of or cause
any lien or encumbrance to arise from, the corporate charter or bylaws
of Buyer, or any court order judgment, arbitration award, decree,
mortgage, indenture, agreement or other instrument by which Buyer is
bound.
Except as provided in this Section 7, no warranties or representations,
express or implied, are made by Buyer to Seller. Buyer's representations and
warranties shall survive for a period of one year from the Instrument Date.
8. Representations and Warranties of Seller
Seller represents and warrants that the following facts and
circumstances are as of the Instrument Date true and correct:
8.1 Seller is a corporation duly organized, validly existing, and in
good standing under the
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laws of Delaware, with the corporate power and authority to enter into
this Instrument and to perform its obligations hereunder;
8.2 This Instrument constitutes a legal and binding obligation of
Seller, enforceable in accordance with its terms;
8.3 The execution and delivery of this Instrument and the consummation
of the Transaction by Seller, has been duly authorized by all necessary
corporate actions of Seller and no further authorization is or will be
necessary on the part of the Seller.
8.4 Title to Assets. Seller has good and marketable title to the Assets
free and clear of any liens or encumbrances;
8.5 Patents. Seller does not own or possess the legal right to any
patents for the Transceivers. Seller has not been informed by any third
party that products being designed, manufactured or sold by Seller in
the normal and ongoing operations of the Transceiver Business infringe
on patent rights of another; and
8.6 Contracts. Seller will deliver or make available to Buyer a
complete and correct list as of the Instrument Date of all of the
Transceiver Business's contracts, orders and commitments together with
all amendments thereto, directly and materially related to the
Transceiver Business.
Except as provided in this Section 8, no warranties or representations,
express or implied, are made by Seller to Buyer regarding the Transceiver
Business or the Assets. Seller specifically disclaims any warranty whatsoever as
to the continued viability of the Transceiver Business after its transfer to
Buyer. Seller's representations and warranties shall survive for a period of one
year from the Instrument Date.
9. Obligations of Seller
Within seven (7) working days of the Instrument Date, Seller shall put
Buyer or its designee into full possession of all the Assets. Seller shall at
Buyer's expense, execute, acknowledge and deliver any further deeds,
assignments, conveyances, and other assurances, documents and instruments of
transfer, reasonably required by Buyer pursuant to this Instrument, and Seller
shall take any other action consistent with the terms of this Instrument, that
may reasonably be requested by Buyer for the purpose of assigning, transferring,
granting, conveying, reducing to possession and confirming to Buyer or its
designee any and all Assets to be conveyed and transferred by this Instrument.
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10. Indemnifications
10.1 Seller's Indemnification. Seller shall indemnify and hold harmless
Buyer from and against loss arising out of or resulting from any
liability or claim in respect of any misrepresentation made by Seller
in this Instrument or any breach of a surviving representation by
Seller under this Instrument.
10.2 Buyer's Indemnification. Buyer shall indemnify and hold harmless
Seller from and against loss arising out of or resulting from any
liability or claim in respect of the operation by Buyer of the
Transceiver Business after the Instrument Date, any misrepresentation
or breach of warranty by Buyer under this Instrument, or any and all
liabilities and obligations assumed by Buyer pursuant to this
Instrument.
10.3 Indemnification, Notice and Counsel. The indemnification
obligations provided for in Sections 10.1 and 10.2 above shall extend
for a period of two (2) years after the Instrument Date. The party
seeking indemnification shall give notice promptly of any claim or
proceeding by reason of which indemnification may arise under Sections
10.1 and 10.2 and the party from which indemnification is sought shall
have the right to defend such claim or proceeding with counsel
reasonably satisfactory to the party seeking indemnification.
11. Access to Records
From and after the Instrument Date, Seller and Buyer shall afford each
other and their counsel, accountants and other representatives such access to
records which, after the Instrument Date, are in the custody or control of the
other party and which either party reasonably requires in order to comply with
its obligations under the law, including but not limited to audits by taxing
authorities, or which Buyer reasonably requires to comply with its obligations
under contracts assumed by it pursuant to this Instrument.
12. Transition Services
Seller shall provide to Buyer and Buyer shall provide to Seller upon
such reasonable terms as Buyer and Seller shall hereinafter agree to in writing,
such services and supplies as are reasonably necessary to complete the transfer
of assets and operation of the Transceiver Business following the Instrument
Date.
13. Termination of Existing Agreements
Upon signing this Agreement, the following existing agreements are
hereby terminated by mutual agreement of the parties:
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1. COOPERATIVE DEVELOPMENT AGREEMENT BETWEEN COMMUNICATIONS & POWER
INDUSTRIES, INC. AND ST MICROWAVE, INC. FOR RADIO FREQUENCY
TRANSCEIVERS FOR SATELLITE COMMUNICATIONS
2. CPI Purchase Order No. 178076
3. CPI Purchase Order No. 219063
4. CPI Purchase Order No. 246352
5. CPI Purchase Order No. 246365
14. Non-competition
For a period of five (5) years from the Instrument Date, Seller
covenants not to engage in any activities which are the same as or similar to
and directly competitive with Buyer's business activities involving the design,
manufacture, sales and service of Transceivers to third parties. This covenant
shall apply everywhere Seller has engaged in any business activity with respect
to Transceivers.
15. Costs
Each of the parties shall pay all of its own costs and expenses and any
fees, commissions or other charges incurred or to be incurred in negotiating and
preparing this Instrument and in carrying out its provisions.
16. Entire Agreement, Modifications
This Instrument constitutes the entire agreement between the parties
pertaining to the subject matter of this Instrument, and supersedes all prior
and contemporaneous agreements, representations and understandings of Buyer and
Seller. No supplement, modifications or amendment of this Instrument shall be
binding unless executed in writing by authorized representatives of Buyer and
Seller.
17. Waiver
No waiver of any of the provisions of this Instrument shall be deemed,
or shall constitute, a waiver of any other provision, whether or not similar,
nor shall any waiver constitute a continuing waiver. No waiver shall be binding
unless executed in writing by the party making the waiver.
18. Headings
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The subject headings of the Sections of this Instrument are included
for purposes of convenience only, and shall not affect the interpretation of
this Instrument.
19. Counterparts
This Instrument may be executed in one or more counterparts, each of
which shall be deemed an original, but all of which shall be deemed an original,
but all of which together shall constitute one and the same instrument.
20. Parties
Nothing in this Instrument, whether express or implied, is intended to
confer any rights or remedies under or by reason of this Instrument on any
persons other than the parties to it and their respective successors and
assigns, nor is anything in this Instrument intended to relieve or discharge the
obligation or liability of any third person to any party to this Instrument, nor
shall any provision give any third persons any right of subrogation or action
over against any party to this Instrument.
21. Assignment
This Instrument shall be binding on, and shall inure to the benefit of,
the parties to it and their respective heirs, legal representatives, successors
and assigns.
22. Notices
All notices, requests, demands and other communications under this
Instrument shall be in writing, and shall be deemed to have been given on the
date of service if served personally on the party to whom notice is to be given,
or on the third day after mailing if mailed to the party to whom notice is
given, by First Class Certified or Express U.S. Mail, postage prepaid and
properly addressed to the address of such parties set forth below, or at such
other address as either party may hereinafter designate in writing and
communicate to the other party in the manner prescribed by this Section 22.
If to Seller:
ST Microwave Corporation
Attn: Xxxx Xxxxxx
000 Xxxxxxx Xxxxxx
Xxxxxxxxx, XX 00000
If to Buyer:
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CPI Satcom Division
Attn: Xxx Xxxxxxxxxxxx, President
0000 Xxxxxxx Xxxxx Xxxxx
Xxxxx Xxxxx, XX 00000
23. Announcements
Neither party will make any announcements to the public or to employees
of Seller concerning this Instrument without the prior approval of the other
party, which approval will not be unreasonably withheld. Notwithstanding any
failure of the other party to approve it, Seller or Buyer may make any
announcement required by applicable law.
24. Severability
If any one or more of the provisions, or a portion of any such
provision, of this Instrument or attachments hereto shall be deemed to be
contrary to law, invalid, illegal or unenforceable in any respect by any
governmental commission, government organization or court of law having
competent jurisdiction over the subject matter and the parties hereto, the
remaining provisions shall be severable and enforceable in accordance with their
terms. It is the express intent of the parties that in the event that a
provision or portion of this Instrument is deemed invalid, illegal or
unenforceable, the parties shall make whatever reasonable adjustments in their
arrangements, if any are required, as may be mutually fair in light of their
original intent as reflected in this Instrument.
25. Governing Law
This Instrument shall be construed in accordance with, and governed by,
the laws of the State of California. Any claim or controversy relating to this
Instrument or arising out of the performance hereof, including any attachment
hereto, which is not disposed of by mutual agreement of the parties, shall be
disposed of solely by the adjudication of a court of competent jurisdiction in
the city or county of Seller's principal place of business and in no other
place. Seller and Buyer hereby consent to such exclusive venue and jurisdiction
of such court or courts and agree to appear in any action filed hereunder upon
written notice thereof.
IN WITNESSETH WHEREOF, the parties have executed this Instrument on the
day and year first above written.
ST MICROWAVE CORPORATION CPI SATCOM DIVISION
("Seller") ("Buyer")
By: /s/ X. X. Xxxxxx By: /s/ Xxxxx X. Xxxxxxxxxxxx
---------------------------- ----------------------------
Secretary V.P. CPI
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