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Exhibit 2(b)
ASSET PURCHASE AGREEMENT
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THIS AGREEMENT, made as of the 9 day of November, 1998, by and
among XXXXXXXX INSTRUMENTS INC., an Ohio corporation ("Seller"), and KLA-TENCOR
CORPORATION, a Delaware corporation ("Buyer"),
WITNESSETH:
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WHEREAS, Buyer desires to acquire certain assets and business
of Seller's Quantox product line (the "Product Line") as a going concern and
Seller desires to sell such assets and business to Buyer;
NOW, THEREFORE, in consideration of the promises, the mutual
covenants and agreements contained herein, and for other good and valuable
consideration, the mutual receipt and sufficiency of which are hereby
acknowledged, the parties hereby agree as follows:
ARTICLE I
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SALE OF ASSETS TO BUYER
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SECTION 1.1. DESCRIPTION OF ASSETS. At the Closing (as defined
in Section 6.1) Seller shall convey, transfer, assign and deliver to Buyer, and
Buyer shall acquire from Seller, all right, title and interest of Seller in and
to the following assets and properties of Seller relating to the Product Line as
the same exist at 11:59 p.m. October 31, 1998, with such additions thereto or
dispositions thereof prior to 11:59 p.m. October 31, 1998 (the "Effective Time")
as are permitted under the terms of this Agreement:
(a) the inventory, raw materials, work in process and finished
goods related to the Product Line and listed on SCHEDULE 1.1(a);
(b) the fixed assets, machinery and equipment, tools, dies,
molds used by Seller in the production of the Product Line listed on
SCHEDULE 1.1(b);
(c) patents, trademarks, names, trade names, marks, symbols,
service marks, logos, copyrights, together with applications therefor,
registrations of and licenses in respect of any of the foregoing and
drawings, specifications, formulae, processes, know-how, software,
technology, trade secrets, customer lists and proprietary rights,
computer tapes and records and other confidential or proprietary
information and data relating exclusively to the Product Line and
listed on SCHEDULE 1.1(c), goodwill associated with such intellectual
property, remedies against infringements thereof and rights to
protection of interest therein;
(d) rights and benefits under all contracts, indentures,
instruments, guarantees and security interests and other agreements
including customer orders, and supplier purchase orders relating
exclusively to the operation of the Product Line, including without
limitation, those listed on SCHEDULE 1.1(d) excluding, however, sales
representative and distributor agreements, and nondisclosure and
confidentiality agreements (the "Transferred Contracts");
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(e) advertising and promotional materials, marketing
materials, books, business records, financial records, goodwill, files,
customer lists, papers, lists, correspondence, personnel and employee
records and publications reports, studies and equipment repair,
maintenance or service records relating exclusively to the Product Line
including those listed on SCHEDULE 1.1(e);
(f) purchase order, lease and other deposits and prepayments
relating to the Product Line and listed on SCHEDULE 1.1(f);
(g) all licenses, permits, authorizations, orders,
registrations, certificates, variances, approvals, consents and
franchises held by Seller relating to the ownership and use of the
Properties (as hereinafter defined) and the conduct of the Product
Line's business as it has been conducted by Seller listed on SCHEDULE
1.1(g); and
(h) all goodwill associated with the Product Line;
provided, however, that there shall be excluded from the assets and properties
to be conveyed, transferred, assigned and delivered to Buyer under this
Agreement any assets or properties of Seller that are not listed on the
foregoing schedules and not a part of the Product Line, including, without
limitation, the following:
(s) items listed on Schedule 1.1(s);
(t) all accounts receivable in existence and outstanding as of
the Effective Time;
(u) all tax returns and supporting schedules of Seller;
(v) all cash, savings deposits and other bank accounts,
certificates of deposit, and checks and drafts of others received but
not yet collected, in each case determined as of the Closing;
(w) any and all rights which accrue or will accrue to Seller
under this Agreement;
(x) all rights under any employee benefit, profit sharing,
pension or other similar plan;
(y) all rights of any nature in and to the name "Xxxxxxxx" or
"Xxxxxxxx Instruments" and all trademarks other than those listed on
SCHEDULE 1.1(c) and all variations thereof, all logos and designs
relating thereto, and all variations thereof; and all supplies that
bear any such name, variation, logos or designs, including letterhead,
invoices and packaging materials; and
(z) any and all assets used in connection with the business of
the Product Line and other businesses of Seller which are not described
in subparagraphs (a) through (h) above.
All of the assets and properties to be conveyed, transferred, assigned and
delivered to Buyer pursuant to this Section 1.1 are hereinafter collectively
referred to as the "Properties." Buyer is not purchasing hereunder any assets,
properties, business, contracts or other agreements of Seller other than the
Properties.
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ARTICLE II
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PURCHASE PRICE AND ASSUMPTION OF
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LIABILITIES
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Section 2.1. Purchase Price.
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(a) Upon the terms and subject to the conditions contained in
this Agreement, and in consideration for the sale, conveyance, transfer,
assignment and delivery of the Properties, Buyer, at the Closing, shall pay to
Seller an amount equal to the Purchase Price (as hereinafter defined). "Purchase
Price" means the amount of Nine Million One Hundred Forty Seven Thousand Dollars
($9,147,000).
(b) $200,000 of the Purchase Price (the "Escrowed Funds")
shall be paid into escrow to be held pursuant to the escrow agreement attached
hereto as EXHIBIT 2.1(b) (the "Escrow Agreement") to be paid to Buyer or Seller,
as the case may be, pursuant to Section 2.1(b). During the time that Seller is
providing Transition Services (as defined in Section 5.7) to Buyer, Seller and
Buyer shall jointly maintain an accounting of all purchases of inventory
(including raw materials) by or on behalf of Buyer in connection with the
Product Line and all shipments of inventory (including raw materials, work in
progress and finished goods) to Seller or Seller's customers in connection with
the Product Line. Within ten days after termination of the Transition Services,
Seller and Buyer shall jointly prepare a statement (the "Transfer Statement")
showing the difference between: (i) $2,080,000; and (ii) the net of all
inventory purchased and all inventory shipped to Buyer or Buyer's customers in
connection with the Product Line. Such difference shall be the "Transfer
Balance." If the Transfer Balance is a positive number, that amount shall be
paid out of the Escrow Funds to Buyer. Any amounts remaining in the Escrow Funds
in excess of the Transfer Balance shall be paid to Seller. If the Transfer
Balance is zero, or is a negative number, the Escrow Funds shall be paid to
Seller. Buyer and Seller shall prepare, execute and deliver escrow instructions
to the escrow agent pursuant to the Escrow Agreement effectuating the foregoing
provision.
(c) The remainder of the payments required under this Section
2.1 shall be made by wire transfer in immediately available funds.
Section 2.2. Assumption of Certain Liabilities.
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(a) In addition to the Purchase Price payable under Section
2.1, and as additional consideration for the Properties, Buyer shall assume, by
appropriate instrument or instruments executed and delivered at the Closing, the
liabilities set forth on Schedule 2.2 (the "Assumed Liabilities"), and
(b) Except as expressly provided otherwise in Section 2.2(a),
all liabilities and obligations of Seller (or any shareholder or affiliate
thereof) shall remain its liabilities and obligations, and Buyer does not and
shall not, by the execution, delivery or performance of this Agreement, the
exercise of any rights with respect to the Properties or any other action,
assume, become responsible for, incur or succeed to any liability or obligation
of any nature of Seller (or any shareholder or affiliate thereof), matured or
unmatured, liquidated or unliquidated, fixed or contingent, or known or unknown,
and whether arising out of occurrences prior to, at or after the date hereof,
including, but not limited to any liability of the Seller for Taxes.
SECTION 2.3. ALLOCATION OF PURCHASE PRICE. Buyer and Seller
agree that the allocation of the Purchase Price attached as SCHEDULE 2.3 shall
be made and reported on required tax returns by each of the parties hereto.
SECTION 2.5. TRANSFER TAX. Any sales, use, excise, ad valorem
or any other similar taxes resulting from the sale of the Properties pursuant to
this Agreement shall be the responsibility of
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Buyer and Buyer shall indemnify Seller against any such taxes wherever assessed.
Any personal property taxes relating to the properties attributable on a pro
rata basis to the portion of any taxable period ending on the Effective Date
shall be the responsibility of Seller. Any personal property taxes relating to
the Properties attributable on a pro rata basis to the portion of any taxable
period occurring after the Closing Date shall be the responsibility of Buyer.
ARTICLE III
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REPRESENTATIONS AND WARRANTIES OF SELLER
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SECTION 3.1. Seller represents and warrants to Buyer that:
(a) CORPORATE STATUS. Seller is a corporation duly organized,
validly existing and in good standing under the laws of the State of Ohio, with
full corporate power and authority to own its properties and assets and carry on
its businesses as and where now owned or conducted. A complete and accurate copy
of Seller's Articles of Incorporation and Code of Regulations as in effect at
the date hereof, are attached hereto as SCHEDULE 3.1(a).
(b) FINANCIAL STATEMENTS. Seller has heretofore delivered to
Buyer the following financial statements for the Product Line which are attached
hereto as SCHEDULE 3.1(b): summary of net assets as at June 30, 1998 and
September 30, 1998 (the "Net Asset Summary") and related statements of income
for the fiscal years ended September 30, 1997 and September 30, 1998 and the
nine months ended June 30, 1998 (the "Income Statements"), (said Net Asset
Summary and Income Statements, collectively the "Financial Statements"). The
Financial Statements were prepared in accordance with generally accepted
accounting principles, and present the financial condition of the Product Line
in accordance with Seller's historic accounting practices, consistently applied,
and in accordance with good business practices.
(c) ABSENCE OF UNDISCLOSED LIABILITIES. There is no liability
or obligation relating to the Properties or the Product Line, absolute or
contingent, liquidated or unliquidated, other than (i) those set forth on the
Net Asset Summary and not discharged or paid since such date, (ii) those
incurred in or as a result of the conduct of the business of Seller since the
date of the Net Asset Summary which were incurred in the usual and ordinary
course of business consistent with past practice and are not inconsistent with
the representations, warranties and agreements of Seller set forth in this
Agreement, (iii) executory obligations to be performed after the date hereof
under contracts and commitments expressly referred to in this Agreement or in
any Schedule hereto or which are not required to be disclosed by Section 3.1(g)
hereof; and (iv) the Assumed Liabilities.
(d) PROPERTY. Seller now has, and by virtue of the deliveries
at the Closing Buyer will obtain, good and valid title to the tangible personal
property included in the Properties, free and clear of all claims (including
insurance claims), liens (relating to Taxes or otherwise), encumbrances,
security interests, equities, charges or restrictions on transfer of any sort
("Liens"), except as reflected in this Agreement or any Schedule hereto, or
imposed by law.
(e) INTANGIBLE PROPERTY. Except as listed on SCHEDULE 1.1(c),
and except for the use of the name "Xxxxxxxx" or "Xxxxxxxx Instruments" (which
are not being transferred to Buyer), no marks, service marks, trademarks, trade
names, copyrights, patents or trade secrets, or licenses thereof are necessary
for the operation of the business of the Product Line as it has been conducted
by Seller. Except as set forth on SCHEDULE 3.1(e), the operation of the Product
Line's business does not infringe, and no one has asserted to Seller that such
operation infringes, and to the best knowledge of Seller no basis for any such
infringement exists, any patent, patent rights, patent application, invention,
trade secret, xxxx,
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service xxxx, trademark, trade name, copyright, or other such right or any
license thereof of any other party.
(i) Except as set forth on SCHEDULE 3.1(e), Seller
has not transferred ownership of or granted any license or right to use
or authorized the retention of any rights to use any intellectual
property used in the development, manufacture, sale or marketing of the
Product Line or the Properties ("Intellectual Property") to any third
party.
(ii) Except as set forth on SCHEDULE 3.1(e), no third
party who has licensed Intellectual Property to the Seller has
ownership rights or license rights to improvements, alterations or
other modifications made by the Seller in such Intellectual Property
which has been licensed to Seller.
(iii) SCHEDULE 3.1(e) lists all contracts, licenses
and agreements between the Seller and any other third party wherein or
whereby the Seller has agreed to, or assumed, any material obligation
or duty to warrant, indemnify, reimburse, hold harmless, guaranty or
otherwise assume or incur any obligation or liability or provide a
right of rescission with respect to the infringement or
misappropriation by the Seller or such other person of another party's
intellectual property.
(iv) Seller has taken all reasonable steps to protect
the Seller's rights in confidential information and trade secrets of
Seller which relate to the Properties, except for such steps, the
absence of which, individually or in the aggregate, would not have a
material adverse effect on the business of the Product Line or the
Properties.
(v) No Intellectual Property or product, technology
or service of Seller relating to the Product Line is subject to any
proceeding or outstanding decree, order, judgment, agreement or
stipulation that restricts in any manner the use, transfer or licensing
thereof by Seller or the validity, use or enforceability of such
Intellectual Property.
(vi) All software from and after version 3.1.1
included in the material products manufactured as part of the Product
Line record, store, process, calculate and present calendar dates
falling on and after (and if applicable spans of time including)
January 1, 2000, and will calculate any information dependent on or
relating to such dates in the same manner, and with the same
functionality, data integrity and performance, as the such products
record, store, process, calculate and present calendar dates on or
before December 31, 1999, or calculate any information dependent on or
relating to such dates.
(vii) All of the intellectual property owned by
Seller and set forth on Schedule 1.1(c) is in full force, subsisting
and, to the knowledge of the Company, not invalid. All necessary
registration, maintenance and renewal fees in connection with such
intellectual property have been paid and all current necessary
documents and certificates in connection with such intellectual
property have been filed with the relevant patent, copyright, trademark
or other authorities in the United States, international or foreign
jurisdictions, as the case may be, for the purposes of maintaining such
intellectual property.
(f) CONTRACTS AND COMMITMENTS. SCHEDULE 3.1(f) is a complete
list of all of the contracts, agreements, covenants, instruments, leases,
licenses or written commitments to which Seller is a party, assignee, or
transferee, which are binding on or benefiting the Product Line or its business
or employees and which are material to the Product Line. All of the Transferred
Contracts are valid and binding, in full force and effect (assuming that the
other party thereto in each such case properly authorized by all requisite
corporate (or if not a corporation, by all other requisite) action and has
properly executed and delivered the Transferred Contracts) and enforceable in
accordance with their respective
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provisions and were entered into in the ordinary course of business consistent
with past practice. Seller has not assigned, mortgaged, pledged, encumbered or
otherwise hypothecated any of its right, title or interest under any Transferred
Contract. Seller (nor to the best knowledge of Seller and any other party
thereto) is not in violation of, in default in respect of, nor has there
occurred an event or condition which, with the passage of time or giving of
notice (or both) would constitute a violation or default under any Transferred
Contract. Copies of all of the foregoing contracts, agreements, covenants,
instruments, leases, licenses or commitments which are in written form have been
made available to Buyer.
(g) COMPLIANCE WITH LAWS. Seller has received no notice of
failure to comply with any applicable law, governmental rule or regulation,
judicial or administrative decision or order. Seller has obtained all licenses
or permits issuable by any governmental authority which are necessary for the
use of the Properties or the operation of the business of the Product Line as it
has been conducted by Seller, and such licenses and permits are listed, together
with the terms for which issued, on SCHEDULE 3.1(g). Except as provided on
SCHEDULE 3.1(g), no notice to, filing with or authorization, consent or approval
of any governmental authority is required in connection with the consummation of
the transactions contemplated by this Agreement, including the transfer and
assignment to Buyer of such licenses and permits. Seller, in the operation of
the Product Line, is in compliance with all applicable laws (including rules,
regulations, codes, plans, injunctions, judgments, orders, decrees, rulings, and
charges thereunder) of federal, state, local, and foreign governments (and all
agencies thereof) the violation of which would have a material adverse effect on
the Product Line or the Properties
(h) LITIGATION. Except as set forth on SCHEDULE 3.1(h), there
is no claim, litigation, action, suit, proceeding, investigation or inquiry,
administrative or judicial, at law, in equity or before or by any federal,
state, local or other governmental authority (collectively "Actions"), pending
or, to Seller's knowledge, overtly threatened against Seller relating to the
Product Line or the Properties or that materially interferes with the business
of the Product Line as currently conducted or that questions the validity of
this Agreement. To Seller's knowledge there is no basis for any Action against
Seller relating to the Product Line or the Properties or that materially
interferes with the business of the Product Line as currently conducted or that
questions the validity of this Agreement.
(i) AUTHORIZATION OF AGREEMENT; NO CONFLICT.
(i) Seller has all requisite power and authority to
enter into, execute and deliver this Agreement, fulfill its obligations
hereunder and consummate the transactions contemplated hereby; such
execution and delivery, performance of obligations and consummation of
the transactions have been duly authorized and approved by all
requisite corporate action by or in respect of Seller; and this
Agreement constitutes the legal, valid and binding obligation of Seller
enforceable in accordance with its terms.
(ii) Except as set forth on SCHEDULE 3.1(I), neither
the execution and delivery of this Agreement, the performance by Seller
of its obligations hereunder nor the consummation of the transactions
contemplated hereby will conflict with, result in a breach of,
constitute a breach of or default under or conflict with the Articles
of Incorporation or Code of Regulations of Seller or any law, rule,
judgment, writ, order, decree, regulation, material agreement
(including those set forth on Schedule 1.1(d)), deed, material
contract, mortgage, material instrument, indenture, or material
commitment to which Seller is a party or by which Seller or any of its
properties and assets, is bound.
(j) EMPLOYEE BENEFIT PLANS; ERISA. SCHEDULE 3.1(J) lists the
employee benefit plans (including welfare plans) maintained by Seller for the
benefit of Seller's employees working on or otherwise affiliated with the
Product Line. None of such plans or assets related thereto are being sold or
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assigned to Buyer hereunder. No liability with respect to such employee benefit
plans will be imposed on Buyer.
(k) LABOR MATTERS. Seller is not a party to any collective
bargaining agreement with respect to employees of the Product Line, and no
notice has been received by Seller of an election petition or claim alleging the
representation of a majority of the employees of the Product Line having been
filed with the National Labor Relations Board or with any executive officer of
Seller, nor to the best knowledge of Seller does a basis for such notice exist.
Seller is in compliance in all material respects with all applicable laws
respecting employment and employment practices, terms and conditions of
employment and wages and hours and Seller has not been and is not engaged in any
unfair labor practice as defined in the National Labor Relations Act, as
amended, the violation of which could have a material adverse effect on the
Properties or the business of the Product Line.
(l) INVENTORY. All items included in the Inventory are (i) of
good and standard quality, (ii) in the case of raw materials, usable in the
normal process of producing finished products being produced by the Product
Line, (iii) in the case of finished products, fit for the purpose for which they
were made and salable in the ordinary course of business, and (iv) contain no
obsolete items, except for items of obsolete material and materials below
standard quality which have been written down to net realizable market value or
have been reserved for in the Financial Statement (which reserve has been
determined in accordance with generally accepted accounting principles).
(m) PRODUCT WARRANTY CLAIMS. SCHEDULE 3.1(m) sets forth a list
of frequently occurring product warranty issues relating to the Product Line.
(n) DISTRIBUTORS, CUSTOMERS, SUPPLIERS. SCHEDULE 3.1(n) sets
forth a complete and accurate list of (i) the ten largest distributors for the
products of the Product Line in the preceding 12 months, indicating the specific
product, existing contractual arrangements, if any, with each such distributors
and the volume of products distributed, (ii) the ten largest customers (by
dollar volume) of the Product Line during the preceding 12 months, indicating
the existing contractual arrangements with each such customer by product and
(iii) the ten largest suppliers of materials or services to the Product Line in
the preceding 12 months, indicating the contractual arrangements for continued
supply from such person.
(o) ABSENCE OF CERTAIN CHANGES. Except as disclosed on
SCHEDULE 3.1(o) since September 30, 1998, the business relating to the Product
Line has been conducted only in the ordinary course consistent with past
practice, and, with respect to the business relating to the Product Line and the
Properties, there has not been:
(1) Any change in its condition (financial or
otherwise), assets, liabilities, earnings,
business or operations, other than changes
in the ordinary course of business
consistent with past practice and certain
bonuses and other arrangements negotiated
with senior executives working on the
Product Line in connection this transaction,
none of which either singly or in the
aggregate has been materially adverse to the
performance of the business of the Product
Line.
(2) Any damage, destruction, casualty or other
similar occurrence or event (whether or not
insured against) which either singly or in
the aggregate materially adversely affects
its assets, liabilities, earnings, business
or operations.
(3) Any Lien on any of the properties or assets
used in the Product Line.
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(4) Any sales, transfers, licenses or other
dispositions of any of the assets used in
the Product Line (including, without
limitation, the Properties listed on
Schedule 1.1(c)) in excess of $10,000 in the
aggregate, except inventory sold and
accounts receivable collected in the
ordinary course of business consistent with
past practice.
(5) Any actions outside of the ordinary course
of business or inconsistent with past
practice by Seller regarding the Product
Line to accelerate the collection of
accounts receivable to the Closing Date
which would in the ordinary course occur
after the Closing Date.
(6) Any change from Seller's past practice
relating to the Product Line regarding the
incurrence and timing of payment of trade
payables.
(7) Cancellation, waiver or release by Seller
regarding the Product Line of any debts,
rights or claims, except in each case with
respect to customer accounts in the ordinary
course of business consistent with past
custom and practices.
(8) Modification, amendment or termination of
any material Transferred Contract, other
than expiration of Transferred Contracts in
accordance with their terms.
(9) Loss or material adverse modification of the
Seller's relationship with any material
customer or supplier relating to the Product
Line, or receipt of notification to such
effect.
(10) Change in accounting principles, methods or
practices (including without limitation any
change in depreciation or amortization
policies or rates) utilized by Seller
regarding the Product Line.
(11) Capital expenditures or commitments therefor
by Seller regarding the Product Line in
excess of an aggregate of $20,000.
(12) No liabilities incurred in excess of $10,000
in any individual instance, except in the
ordinary course of business.
(13) Any increase in compensation paid to
employees working on the Product Line,
except in the ordinary course of business,
consistent with past practice.
(14) Any claim of wrongful discharge or other
unlawful labor practice or action.
(p) CUSTOMER INFORMATION. Seller has sole and exclusive
ownership, free and clear of any Liens, of all of its internal records relating
to customers of the Product Line ("Customer Information"). No third party other
than Seller possesses any claims or rights with respect to use of the Customer
Information.
(q) TAX AND OTHER RETURNS AND REPORTS.
(1) DEFINITION OF TAXES. For the purposes of this
Agreement, "Tax" or , collectively, "Taxes", means any and all federal, state,
local and foreign taxes, assessments and other
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governmental charges, duties, impositions, and liabilities, including taxes
based upon or measured by gross receipts, income, profits, sales, use and
occupation, and value added, ad valorem, transfer, franchise, withholding,
payroll, recapture, employment, excise and property taxes, together with all
interest, penalties and additions imposed with respect to such amounts and any
obligations under any agreements or arrangements with any other person with
respect to such amounts and including any liability for taxes of a predecessor
entity.
(2) TAX RETURNS AND AUDITS. To the extent the failure
to do so would adversely affect Seller's ability to deliver to Buyer free and
clear title to the Properties, Seller has filed within the time period for
filing or any extension granted with respect thereto, all federal, state, local,
foreign and other returns, estimates and reports ("Returns") which it is
required to file relating or pertaining to any and all Taxes attributable to,
levied or imposed upon, or incurred in connection with the Properties and each
portion of any Tax Return pertaining or related to the Properties is true and
correct and has been completed in accordance with applicable law. To the extent
the failure to do so would adversely affect Seller's ability to deliver free and
clear title to the Properties, Seller has paid all Taxes relating to all the
Properties and has withheld with respect to its employees and paid to the
appropriate taxing authority all federal, state and local income taxes, FICA,
FUTA and any other Taxes required to be withheld with respect to the Properties.
(r) BROKERS. With the exception of Alliant Partners
("Alliant"), the transactions contemplated hereby were not submitted to either
Buyer or Seller by any broker or other person entitled to a commission, finder's
fee or like payment thereon, and were not, with the consent of either Buyer or
Seller, submitted to Buyer by any broker or other person, and neither the
actions of Buyer or Seller have given rise to any valid claim by any person
(other than Alliant) for a commission, finder's fee or like payment against any
of the parties hereto.
(s) EXCLUDED ASSETS. Except as set forth on Schedule 3.1(s),
and except for items supplied pursuant to the Supply Agreement and transition
services contemplated by Section 5.7, the Properties constitute all of the
properties, assets and rights necessary to conduct the business of the Product
Line as the same has been conducted by Seller.
SECTION 3.2. SURVIVAL OF WARRANTIES. Notwithstanding any
investigation made by Buyer or any representative thereof with respect to the
subject matter of any representation or warranty of Seller, all of the
representations and warranties set forth in Section 3.1 shall survive the
consummation of any and all transactions contemplated hereby for a period of one
year from and after the Closing Date, except only for the representations and
warranties as to title to the Properties set forth in Section 3.1(e), which
shall survive indefinitely; provided, however, that if Seller receives notice
from Buyer of a breach of a warranty or representation within such one-year
period, such warranty or representation shall survive until all disputes with
respect to such breach are settled.
ARTICLE IV
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REPRESENTATIONS AND WARRANTIES OF BUYER
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SECTION 4.1. Buyer hereby represents and warrants to Seller
that:
(a) CORPORATE STATUS. Buyer is a corporation duly organized,
validly existing and in good standing under the laws of the State of Delaware.
At the Closing, Buyer will be duly qualified as a foreign corporation authorized
to transact business in the State of Ohio.
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(b) AUTHORIZATION OF AGREEMENT. Buyer has all requisite power
and authority to enter into, execute and deliver this Agreement, fulfill its
obligations hereunder and consummate the transactions contemplated hereby; such
execution and delivery, performance of obligations and consummation of the
transactions have been duly authorized and approved by all requisite corporate
action by or in respect of Buyer; and this Agreement constitutes the legal,
valid and binding obligation of Buyer enforceable in accordance with its terms.
SECTION 4.2. SURVIVAL OF WARRANTIES. Notwithstanding any
investigation made by Seller or any representative thereof with respect to the
subject matter of any representation or warranty of Buyer, all of the
representations and warranties set forth in Section 4.1 shall survive the
consummation of any and all transactions contemplated hereby for a period of one
year from and after the Closing Date; provided, however, that if Buyer receives
notice from Seller of a breach of a warranty or representation within such
one-year period, such warranty or representation shall survive until all
disputes with respect to such breach are settled.
ARTICLE V
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CERTAIN COVENANTS AND ACKNOWLEDGMENTS
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SECTION 5.1. TREATMENT OF CERTAIN EXPENSES. The parties hereto
shall each pay their own costs and expenses incurred in connection with the
transactions contemplated hereby, including without limitation the fees and
expenses of their respective counsel, consultants and accountants. All wages,
bonuses, sales commissions, accrued vacation pay, severance payments and any and
all other obligations owing from Seller to any of its employees who enter
Buyer's employ, will to the extent possible be paid in full as of the Closing
Date or prorated and adjusted with Buyer as of the commencement of business on
the Effective Date (such time the "Adjustment Date"). All rents, prepaid
accounts, telephone, heat, power and water bills, taxes and assessments and
other such operating expenses of the Product Line shall be prorated as of the
Adjustment Date and settled as soon as practicable thereafter.
SECTION 5.2. NONCOMPETITION. Seller agrees that for a period
of five years from and after the Closing Date, neither it nor its subsidiaries
will (i) directly or indirectly engage in any manner or capacity, including as
principal, agent, partner, officer, director, employee or shareholder of, or
consultant or adviser to, any corporation, firm or other entity, in any business
which directly competes with the business of the Product Line as currently
conducted; (ii) solicit any present or past customer of the Product Line as
determined as of the Closing Date; or (iii) take any action which would induce
any employee or representative of Seller not to become or continue as an
employee or representative of Buyer during such five-year period. If the scope
of any restriction contained in this Section 5.2 is too broad to permit
enforcement of such restriction to its full extent, then such restriction shall
be enforced to the maximum extent permitted by law, and the parties hereto
consent and agree that such scope may be judicially modified accordingly in any
proceeding brought to enforce such restriction.
Seller acknowledges and agrees that Buyer's remedy at law for
any breach of any obligations under this Section 5.2 would be inadequate, agrees
that temporary and permanent injunctive relief may be granted in any proceeding
which may be brought to enforce any provision of this Section 5.2 without the
necessity of proof of actual damage and hereby consents to such grant in such
event; provided, however, that any such injunctive relief shall not be the
exclusive remedy available to Buyer in the event of any such breach.
SECTION 5.3. BONUSES TO EMPLOYEES. Buyer shall pay to each of
the employees set forth on SCHEDULE 5.3(a) (the "Key Employees") the bonus set
forth next to such Key Employee's name
11
on SCHEDULE 5.3(a). Such bonus shall be paid to each Key Employee upon
commencement of employment with Buyer and shall be treated as an interest free
loan to each such Key Employee, which shall be forgiven on the second
anniversary of such Key Employee's employment with Buyer, provided such Key
Employee has not voluntarily terminated their employment with Buyer prior to
such second anniversary. In the event any Key Employee listed on SCHEDULE 5.3(a)
declines to accept employment with Buyer, the amount to be paid to such Key
Employee by Seller shall, as agreed by Buyer and Seller, either be allocated and
paid to one or more of the other Key Employees listed on SCHEDULE 5.3(a), or be
paid as a retention bonus to that Key Employee or an employee of Seller who
Buyer wishes to employ.
SECTION 5.4. RETENTION OF KEY EMPLOYEES. If, during the
one-year period from and after the Closing any Key Employee indicates to Buyer
that such Key Employee is considering voluntarily terminating his employment
with Buyer, Buyer shall immediately notify Seller. In such event Seller shall
enter into discussions with such Key Employee and Buyer shall cooperate in good
faith with Seller to resolve issues relating to such Key Employee's desire to
terminate his employment with Buyer. If Seller determines in its reasonable
judgment after consultation with Buyer that, but for the payment of an
additional bonus, a Key Employee will terminate his employment with Buyer, Buyer
shall pay such Key Employee a bonus and Seller shall reimburse Buyer the amount
of such bonus. If, notwithstanding such discussions, such Key Employee
voluntarily terminates his employment with Buyer (or voluntarily terminates his
employment with Buyer with no prior notice to Buyer), Seller shall pay Buyer the
amount set forth next to such Key Employee's name on SCHEDULE 5.4. In no event
shall Seller under any circumstances be required to pay Buyer more than an
aggregate of $450,000 (measured on a cumulative basis) to satisfy Seller's
obligations under this Section 5.4. Buyer shall treat the Key Employees on a
basis consistent with other employees of Buyer with positions of similar
responsibility and compensation. Nothing in this Section 5.4 will be deemed to
alter the at-will employment status of the Key Employees.
SECTION 5.5. WARRANTY WORK. If following the Closing, Buyer
incurs actual costs related to Seller's express warranties or retrofits or
upgrades (including, but not limited to software version 3.1.1) on products
manufactured and sold (or otherwise transferred) pursuant to the Product Line
prior to the Closing Date other than such costs as are part of the Assumed
Liabilities, Buyer shall deliver to Seller a certificate setting forth in
reasonable detail the work performed and Buyer's actual cost in performing such
work (the "Warranty Certificate"). Upon Seller's reasonable request, Buyer shall
provide Seller with documentation substantiating the items set forth on the
Warranty Certificate. Within 15 days after receipt of the Warranty Certificate,
Seller shall deliver to Buyer the amount of Buyer's actual cost set forth on the
Warranty Certificate.
SECTION 5.6. NOTICES AND CONSENTS. Seller will give any
notices to third parties, and will use its reasonable efforts to obtain any
third party consents, that are required to transfer the Properties to Buyer.
SECTION 5.7. TRANSITION SERVICES.
(a) Seller shall provide to Buyer all reasonable transition
services needed to transition the business operations of the Product Line from
Seller to Buyer ("Transition Services"). Transition Services will be solely at
the direction of the Buyer and may include (but not limited to) the services set
forth on SCHEDULE 5.7. Except as otherwise noted on SCHEDULE 5.7, the Transition
Services shall be of the type, kind, quality and amount, and at the level of use
maintained by the Seller prior to and at the Closing Date. Seller hereby
represents to Buyer that the Transition Services shall be performed in a manner
of like kind, quality and care as performed by Seller for the operation of the
business of the Product Line prior to and at the Closing Date. In addition to
the Transition Services described on SCHEDULE 5.7, the parties further agree
that if additional transition services ("Additional Services") not contemplated
by this Agreement should be required by Buyer, and Seller agrees to provide such
services, then such Additional Services, as may be identified and at the price
mutually agreed upon in writing by
12
the parties, shall be provided to Buyer. Buyer and Seller shall document the
inclusion in this Agreement of such Additional Services hereunder by an
amendment, letter agreement, or memorandum signed by duly authorized
representatives of both parties, referencing and incorporating (unless the
parties agree otherwise in such document) this Agreement, as appropriate and
agreed upon by the parties. Unless otherwise specifically agreed, Buyer may
terminate any Transition Service or a portion thereof at any time by giving
written notice to Seller no less than thirty (30) days before the date Buyer
wishes to terminate such Transition Service.
(b) Buyer will pay Seller for the Transition Services as set
forth on SCHEDULE 5.7.
SECTION 5.8. COLLECTION OF ACCOUNTS RECEIVABLE. Until February
28, 1999, Buyer shall use all reasonable efforts to support and assist Seller in
the collection of accounts receivable relating to the Product Line.
SECTION 5.9. DELIVERY OF NET ASSET SUMMARY. On or before
November 18, 1998, Seller shall deliver to Buyer a summary of net assets of the
Product Line as of October 31, 1998, prepared on a basis consistent with the
September 30, 1998 Net Asset Summary.
SECTION 5.10. BROKER. Seller has utilized the services of
Alliant in connection with the transaction contemplated by this Agreement, and
Seller agrees that it shall pay any and all commissions, finder's fees or like
payments due to Alliant in connection with such services.
SECTION 5.11. DELIVERIES TO IBM. Under the IBM Agreement (as
defined in Section 7.5), Buyer and Seller acknowledge and agree that Seller is
obligated to provide IBM with a parametric testing unit, and Seller agrees to so
provide IBM with such a unit. Buyer and Seller further acknowledge and agree
that under the IBM Agreement, IBM is entitled to receive, at IBM's election,
either a second parametric testing unit, or a Quantox unit. If IBM elects to
receive a second parametric testing unit, Seller shall provide such a unit to
IBM at Seller's expense, and if IBM elects to receive another Quantox unit,
Buyer shall provide such a unit to IBM at Buyer's expense.
SECTION 5.12. CONSENTS TO ASSIGNMENT. Notwithstanding anything
to the contrary in this Agreement, to the extent that the assignment hereunder
of any item falling within the purview of Section 1.1 of this Agreement, which
would be otherwise assignable hereunder as part of the Properties, shall require
the consent of any other party (or in the event that any of the same shall be
nonassignable), neither this Agreement nor any action taken pursuant to its
provisions shall constitute an assignment or an agreement to assign if such
assignment or attempted assignment would constitute a breach thereof or result
in the loss or diminution thereof or the acceleration of obligations thereunder;
provided, however, that in each such case, Seller shall use all reasonable
efforts to obtain prior to the Closing the written consent of such other party
to such assignment to Buyer where such assignment may be made if such consent is
obtained. If such consent is not obtained prior to Closing and Buyer waives in
writing the requirement that it be obtained, Seller shall cooperate with Buyer
in any reasonable arrangement designed to provide for Buyer the benefits under
any such lease, agreement, contract, contractual right, claim, or the like, as
the case may be, including enforcement, for the account and benefit of Buyer, of
any and all rights of Seller against any other person arising out of the breach
or cancellation by such other person or otherwise.
SECTION 5.13. At the reasonable request of Buyer, Seller shall
enforce (by way of legal proceedings or otherwise) all of its rights under any
agreement or other arrangement which is not a Transferred Contract, the subject
of which relates to the confidential or proprietary nature of the Properties.
Buyer shall be responsible for all reasonable attorneys fees and other
reasonable costs relating to such enforcement. At the reasonable request of
Seller, Buyer shall enforce (by way of legal
13
proceedings or otherwise) all of its rights under any Employee Proprietary
Information and Inventions Agreement between Buyer and any former employee of
Seller.
ARTICLE VI
----------
CLOSING OF TRANSACTIONS
-----------------------
SECTION 6.1. THE CLOSING. The closing of the transactions
contemplated by this Agreement (the "Closing") and all deliveries to be made at
such time shall take place on the date determined in accordance with this
Section (the "Closing Date") at the offices of Xxxxx & Xxxxxxxxx, 0000 Xxxxxxxx
Xxxx Xxxxxx, Xxxxxxxxx, Xxxx 00000, at 10:00 a.m., local time, or at such other
place, date or time as may be agreed in writing by Seller and Buyer. Unless
otherwise agreed, the Closing Date shall be November ___, 1998, to be effective
at 11:59 p.m. October 31, 1998, or by mutual agreement before such date. The
parties agree to use all reasonable efforts to close as soon as possible.
SECTION 6.2. DELIVERIES AT CLOSING.
(a) DELIVERIES BY SELLER. At the Closing, Seller shall execute
and deliver to Buyer:
(i) A General Conveyance, Assignment and Xxxx of
Sale, such documents conveying, transferring and assigning to Buyer all
of the Properties free and clear of any defects, security interests,
liens, encumbrances, charges and equities whatsoever, except for any
expressly assumed or agreed to by Buyer in writing;
(ii) A certificate of Seller's president or Chairman
to the effect that the conditions set forth in Sections 7.1, 7.2, 7.3,
7.4 and 7.5 of this Agreement have been satisfied;
(iii) Where appropriate, any other separate
instruments of sale, assignment or transfer, in form suitable for
filing or recording with any appropriate office or agency, for various
items of the Properties where the same are necessary or desirable in
order to vest or evidence title thereto in Buyer.
(iv) The Supply Agreement (as defined in Section
7.7);
(v) Fully executed assignments, in substantially the
form attached hereto as Exhibit 6.2(a)(v);
(vi) The Escrow Agreement; and
(vii) The opinion of Xxxxx & Xxxxxxxxx LLP.
At or after the Closing, at any time and from time to time, Seller shall also
execute and deliver, at Buyer's expense such further instruments of conveyance,
sale, assignment or transfer, and shall take or cause to be taken such other or
further actions, as Buyer may reasonably request, in order to vest, confirm or
evidence in Buyer title to all or any part of the Properties.
(b) DELIVERIES BY BUYER. At the Closing, Buyer shall execute,
or endorse, and deliver to Seller:
(i) The Purchase Price;
14
(ii) A certificate of Buyer's Vice-President of
Finance to the effect that the conditions set forth in Sections 8.1 and
8.2 of this Agreement have been satisfied;
(iii) The Supply Agreement; and
(iv) The Escrow Agreement
ARTICLE VII
-----------
CONDITIONS PRECEDENT TO OBLIGATIONS OF BUYER
--------------------------------------------
The obligations of Buyer to be performed at the Closing shall
be subject to the satisfaction at or before the Closing of all of the following
conditions (unless waived by Buyer in writing) and Seller shall use all
reasonable efforts to assure that such conditions shall be satisfied:
SECTION 7.1. REPRESENTATIONS AND WARRANTIES. The
representations and warranties set forth in Section 3.1 of this Agreement shall
have been true and correct in all material respects when made and shall be true
and correct in all material respects at and as of the Closing Date as though
such representations and warranties were made at and as of such date.
SECTION 7.2. PERFORMANCE. Seller shall have, in all material
respects, performed and complied with, or caused the performance of and
compliance with, all obligations under this Agreement which are to be performed
or complied with by it or on its behalf at or prior to the Closing.
SECTION 7.3. LITIGATION. There shall be no pending or
threatened claim, litigation, action, suit, proceeding, investigation or
inquiry, judicial or administrative (i) which, if adversely determined, would
materially and adversely affect the Properties or the assets, financial
condition, results of operation or business of the Product Line, or (ii) which
has been brought or overtly threatened for the purpose of enjoining or
preventing the consummation of this Agreement or the transactions contemplated
hereby, which otherwise claims that this Agreement or the consummation of the
transactions contemplated hereby is improper or which asserts that Buyer would
be liable as a transferee of the Properties to any creditor or creditors of
Seller or any affiliate of Seller.
SECTION 7.4. NO MATERIAL ADVERSE EFFECT. Neither the
Properties nor the business of the Product Line shall have been materially
adversely affected as a result of any change, occurrence, circumstance,
condition, loss, damage or destruction of any character, or any combination
thereof, and there shall exist no change, occurrence, circumstance, condition,
loss, damage or destruction (whether or not covered by insurance) of any
character, or any combination thereof, which might reasonably be expected to
result in any such material adverse effect.
SECTION 7.5. CONTACTLESS TESTING TECHNOLOGY LICENSING
AGREEMENT. International Business Machines Inc. ("IBM") shall provide prior
written consent to the assignment of the Contactless Testing Technology
Licensing Agreement between IBM and Xxxxxxxx effective as of May 26, 1994, as
amended June 25, 1996 and September 12, 1998 (the "IBM Agreement") to Buyer.
SECTION 7.6. DELIVERIES AT CLOSING. The deliveries to be made
at the Closing as provided in Section 6.2(a) shall have been completed.
SECTION 7.7. SUPPLY AGREEMENT. The parties shall have entered
into a Supply Agreement (the "Supply Agreement") in substantially the form
attached hereto as EXHIBIT 7.7 pursuant to which Seller shall provide Buyer with
certain finished instruments. Seller shall be reimbursed its out-of-
15
pocket expenses incurred in providing such services, but shall not charge Buyer
any other fees or amounts for such services.
SECTION 7.8. TRANSITION OF EMPLOYEES. Seller will assist Buyer
in transitioning certain key employees to the employ of Buyer and in providing
support services for employees who elect not to relocate with Buyer.
ARTICLE VIII
------------
CONDITIONS PRECEDENT TO OBLIGATIONS OF SELLER
---------------------------------------------
The obligations of Seller to be performed at the Closing shall
be subject to the satisfaction at or before the Closing of the following
conditions (unless waived by Buyer in writing) and Buyer shall use all
reasonable efforts to assure that such conditions shall be satisfied:
SECTION 8.1. REPRESENTATIONS AND WARRANTIES. Buyer's
representations and warranties contained in Section 4.1 of this Agreement shall
have been true and correct in all material respects when made and shall be true
and correct in all material respects at and as of the Closing Date as though
such representations and warranties were made at and as of such date.
SECTION 8.2. PERFORMANCE. Buyer shall have, in all material
respects, performed and complied with, or caused the performance of or
compliance with, its obligations under this Agreement which are to be performed
or complied with by it or on its behalf at or prior to the Closing.
SECTION 8.3. LITIGATION. At the Closing, there is no pending
or overtly threatened claim, litigation, action or proceeding, judicial or
administrative, against Buyer for the purpose of enjoining or preventing the
consummation of this Agreement or otherwise claiming that this Agreement or the
consummation hereof is improper.
SECTION 8.4. CONTACTLESS TESTING TECHNOLOGY AGREEMENT. IBM
shall provide prior written consent to the assignment of the Contactless Testing
Technology Agreement to Buyer.
ARTICLE IX
----------
INDEMNITY
---------
SECTION 9.1. INDEMNITY. Seller, on the one hand, and Buyer, on
the other, agree to hold harmless and indemnify the other, the other's
respective shareholders, directors, officers, employees, representatives,
successors and assigns and, in the case of Seller's indemnity, the Properties,
from and against any claim, loss, damage, and, on the part of Seller, any
liability that is not an Assumed Liability, and on the part of Buyer, any
Assumed Liability, expense or cost of any kind or amount whatsoever, including
without limitation attorneys' fees incurred either before or after the date
hereof, which results from or arises out of any breach of or default under any
representation, warranty, covenant or agreement made by or on behalf of the
indemnifying party in this Agreement, in any Schedule or Exhibit hereto or in
any certificate or other agreement or document furnished or to be furnished by
or on behalf of the indemnifying party under this Agreement or in connection
with the transactions contemplated hereby. Both parties hereto acknowledge and
agree that the indemnification provided in this Agreement is intended to provide
Buyer a right to be made whole by Seller for any of Seller's breaches of any
representation or warranty contained herein whether or not a claim has been
asserted by a third party.
SECTION 9.2. DETERMINATION OF VALID CLAIM. Subject to Section
9.3 of this Agreement, in the event that any party hereto asserts a claim for
indemnification hereunder, such claimant shall give
16
written notice to the indemnifying party specifying the nature and the amount,
if known, of the claim asserted. If the indemnifying party, within a period of
90 days after the mailing of such notice by such claimant, shall not give
written notice to such claimant announcing its intent to contest such claimant's
assertion, such assertion shall be deemed accepted and the amount of such claim
shall be deemed a valid claim and paid promptly by the indemnifying party.
SECTION 9.3. RIGHT TO CONTEST CLAIMS OF THIRD PERSONS.
(a) If a party hereto asserted a claim for indemnification
hereunder because of the assertion of a claim by any third person not a party to
this Agreement (a "Third Party Claim"), the party asserting such claim shall
give the other indemnifying party reasonably prompt notice, but in no event more
than ten business days after said assertion is actually known to such claimant
party. The indemnifying party shall have the right, using counsel reasonably
satisfactory to the claimant, to investigate, secure, contest, or settle the
claim alleged by such third person (hereinafter called a "contest"), provided
that the claimant party may participate voluntarily, at its own expense, in any
such contest through representatives and counsel of its own choice, and,
provided further, that any such action by the indemnifying party relating to the
contest shall be without prejudice to the claimant party.
(b) Except as provided otherwise in the immediately preceding
sentence, the indemnifying party shall bear all costs of such contest and shall
indemnify and hold the claimant party harmless from all costs, fees, and
expenses of such contest. The parties hereto shall make mutually available to
each other all relevant information in their possession relating to any such
contest and shall cooperate in the defense thereof.
(c) Any indemnifying party will have the right to defend the
indemnified party against the Third Party Claim with counsel of its choice
reasonably satisfactory to the indemnified party so long as (A) the indemnifying
party notifies the indemnified party in writing within 15 days after the
indemnified party has given notice of the Third Party Claim that the
indemnifying party will indemnify the indemnified party from and against the
entirety of any losses the indemnified party may suffer resulting from, arising
out of, relating to, in the nature of, or caused by the Third Party Claim, (B)
the indemnifying party provides the indemnified party with evidence reasonably
acceptable to the indemnified party that the indemnifying party will have the
financial resources to defend against the Third Party Claim and fulfill its
indemnification obligations hereunder, (C) the Third Party Claim involves only
money damages and does not seek an injunction or other equitable relief, and (D)
settlement of, or an adverse judgment with respect to, the Third Party Claim is
not, in the good faith judgment of the indemnified party, likely to result in a
material restriction upon the business practices of the indemnified party in
respect of the Properties, and (E) the indemnifying party conducts the defense
of the Third Party Claim actively and diligently.
(d) So long as the indemnifying party is conducting the
defense of the Third Party Claim in accordance with Section 9.3(c) above, (A)
the indemnified party may retain separate co-counsel at its sole cost and
expense and participate in the defense of the Third Party Claim, (B) the
indemnified party will not consent to the entry of any judgment or enter into
any settlement with respect to the Third Party Claim without the prior written
consent of the indemnifying party (which consent shall not unreasonably be
withheld), and (C) the indemnifying party will not consent to the entry of any
judgment or enter into any settlement with respect to the Third Party Claim
unless written agreement is obtained releasing the indemnified party from all
liability thereunder and the indemnified party provides its written consent,
which consent shall not be unreasonably withheld. The indemnified party shall
cooperate in all reasonable respects with the indemnifying party and any
attorneys in the investigation, trial and defense of such lawsuit or action and
any appeal arising therefrom.
17
(e) In the event any of the conditions in Section 9.3(c) above
is or becomes unsatisfied, however, (A) the indemnified party may defend
against, and consent to the entry of any judgment or enter into any settlement
with respect to, the Third Party Claim in any manner it may deem appropriate
(and the indemnified party need not consult with, or obtain any consent from, an
indemnifying party in connection therewith), (B) the indemnifying party will
reimburse the indemnified party promptly and periodically for the costs of
defending against the Third Party Claim (including attorneys' fees and
expenses), and (C) the indemnifying parties will remain responsible for any
losses the indemnified party may suffer resulting from, arising out of, relating
to, in the nature of, or caused by the Third Party Claim to the fullest extent
provided in this Section 9
SECTION 9.4. LIMITS ON INDEMNIFICATION. Notwithstanding any
provisions of Section 9.1, Buyer shall have no right to make a claim thereunder
except for the amount by which the aggregate of all claims thereunder, which
have not theretofore been reimbursed to Buyer, and which Buyer would have been
entitled to assert against Seller absent this Section 9.4 exceeds $50,000,
provided that in no event shall Seller reimburse Buyer for any amounts exceeding
$3,250,000, and further provided that: (a) any liability of Seller imposed on
Buyer (other than any Assumed Liability); and (b) any liability of Seller under
Section 5.3, 5.4 and 5.5 shall not be subject to the foregoing limitations. In
no event shall Buyer reimburse Seller pursuant to this Article IX for any
amounts exceeding $3,250,000 provided that: (a) any liability imposed on Seller
due to Buyer's failure to perform the Assumed Liabilities; and (b) any liability
of Buyer for payments for Transition Services shall not be subject to the
foregoing limitation. If Buyer or Seller have knowledge of a claim under this
Article IX and close the transactions contemplated hereby despite such
knowledge, Buyer or Seller, as the case may be, shall be deemed to have waived
such claim and Seller shall have no liability therefor.
ARTICLE X
---------
GENERAL PROVISIONS
------------------
SECTION 10.1. NOTICES. Any notice or other communication
required or permitted to be given under this Agreement shall be deemed to have
been effectively given and made if in writing and if served either by personal
delivery (including without limitation by air courier service) to the party for
which it is intended or by being deposited in the United States mail, postage
prepaid, certified or registered mail, return receipt requested, addressed as
follows:
SELLER:
Xxxxxxxx Instruments, Inc.
00000 Xxxxxx Xx.
Xxxxxxxxx, Xxxx 00000
Attention: Xxxxxx X. Xxxxxxxx, President and
Chief Executive Officer
with a copy to:
Xxxxx & Xxxxxxxxx LLP
0000 Xxxxxxxx Xxxx Xxxxxx
Xxxxxxxxx, Xxxx 00000
Attention: Xxxxx X. Xxxxxxxx, Esq.
18
BUYER:
KLA-Tencor Corporation
000 Xxx Xxxxxx
Xxx Xxxx, Xxxxxxxxxx 00000
Attention: Xxxx X. Xxxxx, Vice President and
General Counsel
with a copy to:
Xxxxxx Xxxxxxx Xxxxxxxx & Xxxxxx
000 Xxxx Xxxx Xxxx
Xxxx Xxxx, Xxxxxxxxxx 00000
Attention: Xxxxxx Xxxxx O'Brien, Esq.
or addressed to such other single address in the United States of a party as
such party may specify to the others by notice in writing given as provided in
this Section 10.1.
SECTION 10.2. KNOWLEDGE. The terms "To Seller's knowledge,"
"Seller has no knowledge," "Seller has no reason to believe," and other similar
terms when used herein shall mean the actual knowledge of Xxxxxx Xxxxxx, Xxxx
Xxxxxx, Xxxx Xxxxxxx, Xxxx Xxxxxxx or Xxx Xxxx.
SECTION 10.3. ENTIRE AGREEMENT. This Agreement, the Schedules
and Exhibits hereto, the agreements expressly referred to herein and any
agreement making specific reference to this Agreement embody the entire
agreement and understanding of the parties hereto with respect to the subject
matter herein contained, supersede all prior agreements and understandings
relative to the subject matter hereof, and this Agreement may not be changed,
modified, terminated or discharged, in whole or in part (other than in
accordance with the respective terms hereof), except by a writing executed by
the parties hereto. No waiver of any of the provisions or conditions of this
Agreement or any of the rights of a party hereto shall be effective or binding
unless such waiver shall be in writing and signed by the party claimed to have
given or consented to such waiver.
SECTION 10.4. BINDING EFFECT. This Agreement and the various
rights and obligations arising hereunder shall be binding upon and inure to the
benefit of Seller and Buyer and their respective transferees, successors and
permitted assigns. Except as provided otherwise in the immediately preceding
sentence, nothing herein, express or implied, is intended or shall be construed
to confer upon or to give to any person, corporation, firm or legal entity other
than the parties hereto, any rights, remedies or other benefit. Neither this
Agreement nor any right, title and interest herein of either party shall be
assignable (by operation of law or otherwise) except with the prior written
consent of the other party.
SECTION 10.5. GOVERNING LAW. This Agreement shall in all
respects be construed in accordance with and governed by the laws of the State
of Delaware, without giving effect to any choice or conflict of law provision or
rule (whether of the State of Delaware or any other jurisdiction) that would
cause the application of the laws of any jurisdiction other than the State of
Delaware.
SECTION 10.6. COUNTERPARTS. This Agreement may be executed in
multiple counterparts, each of which shall be deemed an original but all of
which together shall constitute one and the same instrument.
SECTION 10.7. CAPTIONS. The captions in this Agreement are
included for purposes of convenience only and shall not be considered a part of
this Agreement in construing or interpreting any provision hereof.
19
SECTION 10.8. INVALIDITY. The invalidity or unenforceability
of any term or provision of this Agreement, or the application of such term or
provision to any person or circumstances, shall not impair or affect the
remainder of this Agreement and its application to other persons and
circumstances, and the remaining terms and provisions hereof shall not be
invalidated but shall remain in full force and effect.
SECTION 10.9. GENDER AND NUMBER. Whenever the context
requires, words used in the singular shall be construed to mean or include the
plural and vice versa, and pronouns of any gender shall be deemed to mean or
include any other gender or genders.
SECTION 10.10. TERMINATION. This Agreement may be terminated
and canceled at any time prior to the Closing:
(a) By mutual agreement of the parties; or
(b) By either Buyer or Seller upon written notice to the other
if (i) any of the representations or warranties of the other party contained
herein shall prove to be inaccurate, untrue or incomplete in any material
respect or (ii) any obligation, term or condition to be performed, kept or
observed by such other party hereunder has not been performed, kept or observed
in any material respect at or prior to the time specified herein. In the event
that such notice is given, the party or parties receiving such notice shall have
30 days within which to cure the specified defect before this Agreement may be
terminated or canceled; or
(c) By Buyer in the event of materially adverse loss or damage
to, or condemnation of the Properties, or of any real property in respect of
which Seller has a leasehold interest, which loss, damage or condemnation is not
recovered, restored or revoked, as the case may be, within 15 days, it being
understood that none of the risk of any such loss, damage or condemnation prior
to the Closing of the transactions contemplated hereby shall be borne by Buyer;
or
(d) By either party if the Closing has not taken place by the
close of business on November 9, 1998.
SECTION 10.12. PUBLIC ANNOUNCEMENT. All press releases and
other public announcements of the transactions contemplated herein to be made by
either party hereto shall be subject to the prior review and approval of the
other; provided, however, that no such review and approval shall be required
with respect to any public announcement by Seller deemed by its counsel to be
required under state or federal securities laws, which Seller shall provide to
Buyer at a reasonable time prior to disclosure.
SECTION 10.13 NO THIRD PARTY BENEFICIARIES. This Agreement
shall not confer any rights or remedies upon any person other than the parties
and their respective successors and permitted assigns.
SECTION 10.14 CONSTRUCTION. The parties have participated
jointly in the negotiation and drafting of this Agreement. In the event an
ambiguity or question of intent or interpretation arises, 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 of the provisions of this Agreement. Any reference to any
federal, state, local, or foreign statute or law shall be deemed also to refer
to all rules and regulations promulgated thereunder, unless the context requires
otherwise. The word "including" shall mean including without limitation. For
purposes of the Schedules, any item disclosed on any Schedule hereto shall be
deemed disclosed on each schedule hereto to which such item reasonably relates.
The parties intend that each representation, warranty, and covenant contained
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herein shall have independent significance. If any party has breached any
representation, warranty, or covenant contained herein in any respect, the fact
that there exists another representation, warranty, or covenant relating to the
same subject matter (regardless of the relative levels of specificity) which the
party has not breached shall not detract from or mitigate the fact that the
party is in breach of the first representation, warranty, or covenant.
SECTION 10.15. INCORPORATION OF EXHIBITS AND SCHEDULES. The
Exhibits and Schedules identified in this Agreement are incorporated herein by
reference and made a part hereof.
IN WITNESS WHEREOF, the parties hereto have executed this
Agreement as of the day and year first above written.
SELLER:
XXXXXXXX INSTRUMENTS, INC.
By Xxxxxx X. Xxxxxxxx
------------------------------------------------
Its Chairman, President and Chief Executive Officer
------------------------------------------------
BUYER:
KLA-TENCOR CORPORATION
By Xxx X. Xxxxxxxx
---------------------------------------
Its
----------------------------------------
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INDEX OF SCHEDULES NOT FILED WITH THE ASSET PURCHASE AGREEMENT:
Schedule 1.1(a) - Assets
Schedule 1.1 (b) - Assets
Schedule 1.1 (c) - Assets
Schedule1.1(d) Rights and benefits under all contracts
Schedule 1.1 (e) - Assets
Schedule 1.1 (f) - Assets
Schedule 1.1 (g) - Licenses
Schedule 1.1 (s) - Excluded Properties
Schedule 2.2 - Assumption of certain liabilities
Schedule 2.3 - Allocation of Purchase Price
Schedule 3.1 (e) - Intangible Property
Schedule 3.1 (f) - Contracts and Commitments
Schedule 3.1 (g) - Compliance with laws
Schedule 3.1 (h) - Litigation
Schedule 3.1 (i) - Authorization of Agreement; No Conflict
Schedule 3.1 (j) - Employee Benefit Plans, ERISA
Schedule 3.1 (m) - Product warranties; defect; liability
Schedule 3.1 (n) - Distributors, Customers, Suppliers
Schedule 3.1 (o) - Certain Changes
Schedule 3.1 (s) - Excluded Assets
Schedule 5.3 - Employee Bonuses
Schedule 5.4 - Retention of Employees
Schedule 5.7 - Transition Services
The company agrees to furnish supplementally a copy of any omitted schedule to
the Commission upon request.
