Exhibit 2.1
AGREEMENT AND PLAN OF MERGER
This Agreement is made as of January 15, 1999 among RADIATION ONCOLOGY
COMPUTER SYSTEMS, INC., a California corporation ("COMPANY"), shareholders of
Company listed on the signature page hereof ("SHAREHOLDERS"), NOMOS CORPORATION,
a Delaware corporation ("PARENT"), and ROCS ACQUISITION, INC., a Delaware
corporation and a wholly-owned subsidiary of Parent ("SUB"), with the intent to
be legally bound. Capitalized terms used herein are defined in the text; an
index of such terms is attached to the end of this Agreement.
ARTICLE I
MERGER
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1.01. THE MERGER. Subject to the terms and conditions of this Agreement
and in accordance with the Delaware General Corporation Law, as amended (the
"DGCL") and the California General Corporation Law, as amended (the "CGCL"), at
the Effective Time, Company and Sub shall consummate a merger (the "MERGER")
pursuant to which (i) Company shall merge with and into Sub and the separate
corporate existence of Company shall thereupon cease, and (ii) Sub shall be the
surviving corporation (the "SURVIVING CORPORATION") in the Merger and shall
continue to be governed by the laws of the State of Delaware. The Merger shall
have the effects set forth in the DGCL and the CGCL.
1.02. EFFECTIVE TIME. Parent, Sub and Company will cause (i) a properly
executed Certificate of Merger with respect to the Merger meeting the
requirements of Section 251 of the DGCL (the "CERTIFICATE OF MERGER") to be
executed and filed on the Closing Date (or on such other date as Parent and
Company may agree) with the Secretary of State of the State of Delaware as
provided in the DGCL, and (ii) a properly executed Agreement of Merger and a
properly executed Officer's Certificate with respect to the Merger meeting the
requirements of Section 1108 of the CGCL (the "AGREEMENT OF MERGER ") to be
executed and filed on the Closing Date (or on such other date as Parent and
Company may agree) with the Secretary of State of the State of California as
provided in the CGCL. The Merger shall become effective on the date on which (i)
the Certificate of Merger has been duly filed with the Secretary of State of the
State of Delaware as provided in the DGCL, and (ii) the Agreement of Merger has
been filed with the Secretary of State of the State of California as provided in
the CGCL, or such time as is agreed upon by the parties and specified in the
Certificate of Merger and the Agreement of Merger, and such time is hereinafter
referred to as the "EFFECTIVE TIME".
1.03. CLOSING. The closing of the Merger (the "CLOSING") will take
place at 10:00 a.m., local time, on or before January 27, 1999, subject to the
satisfaction or waiver of all of the conditions set forth in Article VI no later
than two business days prior to such
date (the "CLOSING DATE"), at the offices of Xxxxx & Xxxxxxx, P.C., 00 Xxxxxxx
Xxxxxx, 00xx Xxxxx, Xxxxxxxxxx, Xxxxxxxxxxxx 00000, unless another time, date or
place is agreed to in writing by the parties hereto.
1.04. CERTIFICATE OF INCORPORATION AND BYLAWS OF SURVIVING CORPORATION.
Pursuant to the Merger, (i) the Certificate of Incorporation of Sub, as in
effect immediately prior to the Effective Time, shall be the Certificate of
Incorporation of the Surviving Corporation until thereafter amended, and (ii)
the By-Laws of Sub, as in effect immediately prior to the Effective Time, shall
be the By-Laws of the Surviving Corporation until thereafter amended.
1.05. DIRECTORS AND OFFICERS OF SURVIVING CORPORATION. The directors of
Sub at the Effective Time shall, from and after the Effective Time, be the
initial directors of the Surviving Corporation until their successors shall have
been duly elected or appointed or qualified or until their earlier death,
resignation or removal in accordance with the Surviving Corporation's
Certificate of Incorporation and By-Laws. The officers of Sub at the Effective
Time shall, from and after the Effective Time, be the initial officers of the
Surviving Corporation until their successors shall have been duly elected or
appointed or qualified or until their earlier death, resignation or removal in
accordance with the Surviving Corporation's Certificate of Incorporation and
By-Laws.
1.06. BEST EFFORTS TO ASSIGN. This Agreement shall not constitute an
agreement to assign any Company Business Agreements or Company Business Permits
or any right or benefit arising thereunder or resulting therefrom if an
attempted assignment thereof, without the consent of a third party thereto,
would constitute a breach thereof or in any way affect the rights of the Company
hereunder. Company, Parent and Sub shall use commercially reasonable best
efforts to obtain the consent of the other party to the assignment thereof to
Sub in all cases in which such consent is required for assignment or transfer.
If such consent is not obtained, the parties agree to cooperate with each other
in any reasonable arrangement designed to provide to the Sub the benefits
thereunder.
ARTICLE II
CONVERSION OF SHARES
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2.01. CONVERSION OF SHARES.
(a) At the Effective Time, each share of Company's common stock,
no par value ("COMPANY COMMON STOCK"), issued and outstanding immediately prior
to the Effective Time (other than shares of Company Common Stock to be cancelled
pursuant to Section 2.01(c) hereof) shall, by virtue of the Merger and without
any action on the part of the holder thereof, be converted into the right to
receive (i) $19.607843 in cash, without any interest thereon (ii) 2.5245098
shares of Parent Common Stock, (iii) .245098 shares of Parent Common Stock
pursuant to Section 2.01(e) and (iv) a pro rata
share of any Earn-Out Fees payable as described in Section 2.02 (collectively,
the "MERGER CONSIDERATION").
(b) Each share of Sub's common stock, par value $1 per share
("SUB COMMON STOCK"), issued and outstanding immediately prior to the Effective
Time shall, at the Effective Time, remain issued and outstanding and shall be
unchanged by virtue of the Merger.
(c) All shares of Company Common Stock that are owned by Company
as treasury stock shall, at the Effective Time, be cancelled and retired and
shall cease to exist and no consideration shall be delivered in exchange
therefor.
(d) On and after the Effective Time, holders of certificates
which immediately prior to the Effective Time represented outstanding shares of
Company Common Stock shall cease to have any rights as shareholders of the
Company, except the right to receive the Merger Consideration for each share of
Company Common Stock held by them.
(e) An additional 25,000 shares of Parent Common Stock to be paid
to the Shareholders under Section 2.01(a) above (the "ESCROW FUND") shall be
delivered to Xxxxx & Xxxxxxx, P.C. (the "ESCROW AGENT"), to be held or disbursed
in accordance with the terms of an Escrow Agreement in substantially the form of
EXHIBIT 2.01 (the "ESCROW AGREEMENT").
2.02 EARN-OUT.
(a) With respect to each of the three 12 month periods ending
April 30, 2000, April 30, 2001 and April 30, 2002 (each an "ANNUAL PERIOD" and
together the "EARN-OUT PERIOD"), Parent shall pay to Shareholders an annual fee
(the "EARN-OUT FEE") equal to 3% of the Gross Revenues of Parent or any
Affiliate of Parent or Sub ("PARENT GROUP") derived from (i) the products
developed or manufactured by Company prior to the Effective Date as listed in
Section A of EXHIBIT 2.02 (the "ROCS PRODUCTS"), and (ii) any and all upgrades,
enhancements, improvements and new versions of the ROCS Products, only to the
extent that such Gross Revenues in an Annual Period exceed an Annual Period
threshold amount of $4,717,000. By way of example, see Section B of EXHIBIT
2.02. The parties hereto acknowledge and agree that, after the date of this
Agreement, ROCS is expected to complete certain of the ROCS Products that are
not currently being marketed and for which no list price has been established.
The list price of such products will be set by Parent based upon then-existing
market conditions and such prices will be used for purposes of the earn-out
described in this Section 2.02, if applicable.
(b) The term "GROSS REVENUES" means (i) the total gross revenues
actually received by Parent Group from third parties for ROCS Products sold or
licensed and (ii) any other amounts due or payable to Parent Group from third
parties in connection with the ROCS Products, without credit for uncollected
accounts, discounts or refunds, and including all amounts regardless of the form
of payment; provided, however, that Gross Revenues shall not include sales, use,
value added and other taxes based on gross revenues which Parent Group is under
a legal obligation to pay, and which are in fact paid over to the appropriate
governmental entities.
(c) If the ROCS Products are priced and packaged with other
products or services as a combined system and are sold or licensed to a third
party by Parent Group, the Gross Revenues received by Parent Group for such ROCS
Products shall be determined as follows:
The then current list price of the ROCS Products shall be divided by the then
current list price of the total packaged system. The resulting number shall then
be multiplied by the total system price actually received by Parent Group. The
resulting number shall constitute the Gross Revenues received by Parent Group
for such ROCS Products. By way of example, see Section C of EXHIBIT 2.02.
(d) Within 90 days after the end of each 12 month period during
the Earn-Out Period, Parent Group shall provide to Shareholders: (i) a true and
correct copy of Parent Group's financial statements prepared in accordance with
GAAP and reported upon by an independent accounting firm of recognized national
or regional standing, and (ii) an audit report which sets forth Parent Group's
Gross Revenues during such fiscal year, and the amount of the Earn-Out Fee owed
to Shareholders with respect to such fiscal year. Such audit report shall be
accompanied by a certification of Parent Group's auditors that they have
conducted an examination, in accordance with GAAP, of the books and records of
Parent Group relating to such audit report and, based on such examination, they
shall confirm the accuracy of such report. The financial statements and the
audit reports required to be provided by this Section 2.02(c) shall be
collectively referred to herein as the "EARN-OUT REPORTS."
(e) Shareholders shall have a period of 30 days after their
receipt of each Earn-Out Report to review the same and Parent Group's
calculation of such Earn-Out Fee and to notify Parent Group of any disputes
regarding the same. If Shareholders shall so notify Parent Group of any
disputes, then the parties will negotiate in good faith in an effort to resolve
such disputes. If the parties are unable to resolve such disputes within 30 days
after Parent Group receives notice of the same, then either party may submit
such dispute to an independent accounting firm of recognized national or
regional standing mutually acceptable to Parent Group and Shareholders for
resolution or, if they cannot agree, a nationally-recognized accounting firm
chosen by lot (with each party having the right to strike one such firm). The
determination by such accounting firm shall be conclusive and binding upon the
parties. The fees and expenses of such accounting firm shall be shared equally
by Parent Group and Shareholders.
(f) Each Earn-Out Fee shall be paid within 30 days after an
Earn-Out Report for such fiscal year has been delivered to Shareholders and any
disputes with respect thereto have been resolved. Each Earn-Out Payment shall be
shared pro rata between Shareholders in the same proportion as the other Merger
Consideration is shared by Shareholders under Section 2.01.
(g) The Parent and/or the Sub may sell all or any part of a line
of ROCS Products to a third party, provided that such third party shall agree to
pay the Earn-Out Fee to the Shareholders for the remainder of the Earn-Out
Period subject to the terms and conditions of this Section 2.02.
2.03. PARENT COMMON STOCK. The shares of Parent Common Stock issued in
connection with the Merger will be issued in a transaction exempt from
registration under the Securities Act, by reason of Section 4(2) of the
Securities Act or Regulation D thereunder. Such shares may not be transferred or
resold thereafter except in compliance with the terms of this Agreement and
following registration under the Securities Act or in reliance on an exemption
from registration under the Securities Act.
2.04 TAX CONSEQUENCES. It is intended by the parties hereto that the
Merger will constitute a reorganization within the meaning of Section 368 of the
Code. Each party has consulted its own tax advisors with respect to the tax
consequences of the Merger. The parties have no present intent to take any
action that would jeopardize the tax-free nature of the Merger.
ARTICLE III
REPRESENTATIONS AND WARRANTIES OF COMPANY AND SHAREHOLDERS
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Company and Shareholders (collectively, the "COMPANY PARTIES") jointly
and severally represent and warrant to Parent and Sub as follows:
3.01. ORGANIZATION AND QUALIFICATION. Company is a corporation duly
organized, validly existing and in good standing in the State of California.
Company is duly qualified to do business as a foreign corporation and is in good
standing in the jurisdictions listed on SCHEDULE 3.01, which are all
jurisdictions in which the ownership of its properties or the nature of its
business makes such qualification necessary, except to the extent that the
failure to be so qualified has not resulted in, and is not likely to result in,
a material adverse change in the business, operations, financial condition or
prospects of Company (a "COMPANY MATERIAL ADVERSE CHANGE").
3.02. AUTHORITY AND AUTHORIZATION. Company has the corporate power and
authority to own its properties and assets, to conduct its business as presently
conducted and to execute, deliver and perform this Agreement and the other
Transaction Documents.
3.03. EXECUTION AND BINDING EFFECT. This Agreement has been, and on the
Closing Date the other Transaction Documents will be, duly and validly executed
and delivered by Company and constitute (or upon such execution and delivery
will constitute) legal, valid and binding obligations of Company enforceable
against Company in accordance with their respective terms.
3.04. NO BREACH, DEFAULT, VIOLATION OR CONSENT. Assuming that Company
obtains all necessary consents with respect to the assignment or transfer of
Company Business Agreements, Company Intellectual Property and Company Business
Permits, as of the Closing Date, the execution, delivery and performance by
Company of this Agreement and the other Transaction Documents do not and will
not:
(a) violate Company's charter or by-laws;
(b) breach or result in a default (or an event which, with the
giving of notice or the passage of time, or both, would constitute a default)
under, require any consent under or give to others any rights of termination,
acceleration, suspension, revocation, cancellation or amendment of any Company
Business Agreement or Company Business Permit;
(c) breach or otherwise violate any order, writ, judgment,
injunction or decree issued by any governmental entity (each a "GOVERNMENTAL
ORDER") which names Company or is directed to Company or any of its assets;
(d) violate any law, rule, regulation, ordinance or code of any
governmental entity (each a "GOVERNMENTAL Rule"); or
(e) require any consent, authorization, approval, exemption or
other action by, or any filing, registration or qualification with, any person
or entity (each a "PERSON").
3.05. OWNERSHIP AND CONTROL. SCHEDULE 3.05 sets forth a correct and
complete list of (a) the authorized capitalization of Company, (b) the number of
shares of each class of capital stock of Company issued and outstanding and (c)
the names of the record owners of each share of Company's capital stock and the
number and percentage of shares of each class of its capital stock owned by such
Persons. The issued and outstanding shares of its capital stock have been duly
authorized and validly issued and are fully paid and non-assessable. Except as
otherwise disclosed on SCHEDULE 3.05, there are no outstanding (x) options,
warrants, agreements or other rights for the acquisition of shares of Company's
capital stock, (y) securities or other obligations of Company which are
convertible into such shares or (z) options, sale agreements, shareholder
agreements, pledges, proxies, voting trusts, powers of attorney, restrictions on
transfer or other agreements or instruments which are binding on any of
Company's
shareholders and which relate to the ownership, voting or transfer of any of
such shares.
3.06. SUBSIDIARIES. Except as set forth on SCHEDULE 3.06, Company has
no Subsidiaries. As used in this Agreement, the term "SUBSIDIARY" means, with
respect to any Person, any corporation, partnership, limited liability company,
joint venture or other business entity with respect to which such Person or any
subsidiary of such Person is entitled, by reason of a direct or indirect
ownership interest therein, to (a) elect a majority of the directors thereof or
otherwise direct or cause the direction of the management and policies thereof
or (b) receive a majority of the dividends and other distributions made thereby,
in each case regardless of any contingency which does or may suspend or dilute
such rights.
3.07. FINANCIAL STATEMENTS. Company has previously delivered to Parent
and Sub correct and complete copies of (a) its reviewed balance sheets and
statements of income, retained earnings and cash flow as of and for its fiscal
years ended April 30, 1997, 1996 and 1995, including the footnotes thereto, and
(b) its unaudited interim balance sheets and statements of income, retained
earnings and cash flow as of and for its fiscal quarters ended November 30, 1998
(the "COMPANY CURRENT FINANCIAL STATEMENTS" and, together with the items
described in clause (a) above, the "COMPANY FINANCIAL STATEMENTS"). The Company
Financial Statements present fairly the financial condition of Company as at the
end of the periods covered thereby and the results of its operations and the
changes in its financial position for the periods covered thereby, and were
prepared in accordance with generally accepted accounting principles ("GAAP")
applied on a consistent basis throughout the periods covered thereby subject, in
the case of the Company Current Financial Statements, to year-end review
adjustments (which will not be material except as otherwise disclosed on
SCHEDULE 3.07) and the lack of footnotes and other presentation items. Except as
and to the extent otherwise disclosed in the Company Current Financial
Statements and on SCHEDULE 3.07, Company has no liabilities of any kind, whether
direct or indirect, fixed or contingent or otherwise, other than (x) liabilities
under Company Business Agreements which are not required to be set forth on the
Company Current Financial Statements in accordance with GAAP and (y) liabilities
incurred in the ordinary course of business since November 30, 1998 (the
"COMPANY FINANCIAL STATEMENT DATE").
3.08. ACCOUNTING PRACTICES. Company's books, records and accounts
accurately and fairly reflect, in reasonable detail, its financial position and
operations. Company maintains a system of internal controls deemed to be
sufficient by the management of the Company to provide reasonable assurances
that (a) transactions are executed in accordance with management's general or
specific authorization, (b) transactions are recorded as necessary to permit
preparation of financial statements in accordance with GAAP and to maintain
accountability for assets, (c) access to assets is permitted only in accordance
with management's general or specific authorization and (d) the assets
reflected on Company's books are compared with existing assets at reasonable
intervals and appropriate action is taken with respect to any differences.
3.09. BANK ACCOUNTS. SCHEDULE 3.09 sets forth a correct and complete
list of the names and locations of all banks, trust companies, savings and loan
associations and other financial institutions at which Company maintains
accounts of any nature, the type and number of all such accounts and the names
of all persons authorized to draw thereon or make withdrawals therefrom.
3.10. TAX MATTERS. Except as otherwise disclosed on SCHEDULE 3.10:
(a) all tax returns and reports required to be filed by Company
have been properly prepared and filed;
(b) Company has paid, or has made adequate reserves on its books
for the payment of, all taxes, interest, penalties, assessments and deficiencies
shown to be due on such tax returns and reports or claimed to be due by any
governmental entity or which Company is required to withhold on behalf of any
other Person;
(c) the reserves and provisions for taxes on the books of Company
are adequate for all open years and for its current fiscal period and properly
classify such tax obligations as either current or deferred;
(d) Company Parties have no knowledge of any proposed assessment
of any additional taxes by any governmental entity or of any basis for any such
assessment (whether or not reserved against);
(e) the federal income tax liabilities of Company have been
finally determined by the Internal Revenue Service (the "IRS"), or the time for
audit has expired, for all fiscal periods ending on or prior to April 30, 1995;
(f) Company has not received any notices to the effect that the
Company is being audited by a governmental entity and, to the best of the
Company Parties' knowledge, Company is not currently being audited by any
governmental entity, and no such audit is pending or, to the best of Company
Parties' knowledge, threatened;
(g) Company has not made any tax elections which (i) were in
effect in any past year for which the time for audit has not expired, (ii) are
currently in effect or (iii) will be in effect at any future time; and
(h) Company has not given any waiver or extension of any period
of limitation governing the time of assessment or collection of any tax.
3.11. LITIGATION. Except as otherwise disclosed on SCHEDULE 3.11, there
is no pending or, to the best of Company Parties' knowledge, threatened
investigation, action or proceeding against Company or any of its assets by or
before any governmental entity or arbitrator, and Company Parties have no
knowledge of any basis for any such action, proceeding or investigation.
SCHEDULE 3.11 sets forth a correct and complete list of each investigation,
action and proceeding described in the preceding sentence, the parties thereto,
the alleged basis therefor, the relief sought therein and the current status
thereof.
3.12. ABSENCE OF CERTAIN CHANGES AND EVENTS. Except as otherwise
disclosed on SCHEDULE 3.12, since the Company Financial Statement Date:
(a) Company has not incurred any material obligation or liability
except for normal trade obligations incurred in the ordinary course of business;
(b) no casualty, loss or damage has occurred with respect to any
of Company's assets, whether or not the same is covered by insurance;
(c) Company has not sold, transferred or otherwise disposed of
any of its assets or any interest therein, or agreed to do any of the foregoing,
except for sales of inventory in the ordinary course of business;
(d) Company has not written off as uncollectible any of its
accounts receivable in excess of reserves, or written down the value of any of
its assets, except in each case in the ordinary course of business and at a rate
no greater than during the 12-month period ending on the Company Financial
Statement Date;
(e) Company has not waived or released any of its material rights
with respect to its business or assets or permitted any of such rights to lapse;
(f) no executive officer or other key employee of Company has
left his or her employment with Company;
(g) Company has not granted, and is not committed to grant, any
salary or wage increases to any of its employees;
(h) Company has not made, or committed to make, any capital
expenditures in excess of $5,000 in the aggregate;
(i) there has been no payment, discharge or other satisfaction of
any liabilities of Company other than the satisfaction, in the ordinary course
of business, of liabilities reflected on the Company Current Financial
Statements or incurred in the ordinary course of business since the Company
Financial Statement Date;
(j) Company has not declared or paid any dividend or other
distribution in respect of its capital stock or agreed to do any of the
foregoing;
(k) Company has not introduced any material change with respect
to its business, including without limitation with respect to the products or
services it sells, the areas in which such products or services are sold, its
methods of manufacturing or distributing its products, its marketing techniques
or its accounting methods; and
(l) no Company Material Adverse Change, and no event which, to
the best of Company Parties' knowledge, is likely to result in a Company
Material Adverse Change, has occurred.
3.13. CUSTOMERS AND SUPPLIERS. SCHEDULE 3.13 sets forth a correct and
complete list of each of the customers and suppliers of Company whose purchases
from or sales to Company constituted five percent or more of Company's net sales
or net purchases, respectively, during its fiscal year ended April 30, 1998,
1997, 1996 and 1995, or during the six months ending on the Company Financial
Statement Date, and indicates with respect to each the name and address, dollar
volume and nature of the relationship (including the principal categories of
products bought or sold). Company is not required to provide any material
bonding or other financial security arrangements in connection with any of its
transactions with any such customer or supplier. Since the Company Financial
Statement Date, no such customer or supplier has terminated its relationship
with, or materially reduced its purchases from or sales to, Company, and the
Company Parties have no knowledge that any such customer or supplier intends to
terminate its relationship with, or materially reduce its purchases from or
sales to, Company.
3.14. CONSTITUENT DOCUMENTS AND GOVERNMENTAL RULES. Company is in
compliance with (a) its charter and by-laws and (b) all Governmental Rules
applicable to Company, its business or its assets.
3.15. GOVERNMENTAL ORDERS. SCHEDULE 3.15 sets forth a correct and
complete list of all Governmental Orders which name Company or are directed to
Company or any of its assets, together with the governmental entity who issued
the same and Subject matter thereof. Company is in compliance with all such
Governmental Orders.
3.16. COMPANY BUSINESS PERMITS. SCHEDULE 3.16 sets forth a correct and
complete list of all permits, licenses, franchises, certificates,
authorizations, consents and approvals obtained from or issued by any
governmental entity and which are necessary for the ownership or operation of
Company's business or the ownership, operation or use of any of its assets
(collectively, "COMPANY BUSINESS PERMITS"), and indicates for each whether the
same are transferable and, if so, whether consent to such transfer is required.
Such Company Business Permits have been validly acquired, are in
full force and effect and represent all governmental permits, licenses,
franchises, certificates, authorizations, consents and approvals necessary under
applicable Governmental Rules for Company to carry on its business as now being
conducted and to own, occupy or use its assets. No material violations have been
recorded against any such Company Business Permit, no citation, notice or
warning has been issued by any governmental entity with respect to any such
Company Business Permit, no investigation or hearing has been held by or before
any governmental entity with respect to any such Company Business Permit,
Company has not received any notice from any governmental entity that it intends
to cancel, revoke, terminate, suspend or not renew any such Company Business
Permit and Company Parties have no knowledge of any basis for any of the
foregoing. Company is in compliance with all Company Business Permits, except
for such non-compliance as, individually or in the aggregate, has not resulted
in, and is not likely to result in, a Company Material Adverse Change.
3.17. ENVIRONMENTAL MATTERS. Except as otherwise disclosed on SCHEDULE
3.17:
(a) no Hazardous Substances have been or are being generated,
used, processed, treated, stored, released, transported or disposed of by
Company except in compliance with Environmental Rules;
(b) to the best of the Company Parties' knowledge, no Person who
has leased, occupied or used any real property now or previously owned, leased,
occupied or used by Company generated, used, processed, treated, stored,
released or disposed of any Hazardous Substances on such property;
(c) no Hazardous Substances are present on or under any real
property (including without limitation in any body of water located thereon or
adjacent thereto or any groundwater located thereunder) now or previously owned,
leased, occupied or used by Company, or in any improvement located thereon, in
quantities or at levels which require reporting or remediation under any
applicable Environmental Rule; and
(d) no event has occurred and no condition exists with respect to
Company or its business or assets which has resulted in, or is likely to result
in, any material liability, cost or expense to Company or any other Person who
owns or operates its business or assets under any applicable Environmental Rule,
and Company has not received any notice from any governmental entity or other
Person of its intention to impose any such liability, cost or expense upon
Company or any such Person.
As used in this Agreement the following terms have the following
meanings:
"ENVIRONMENTAL RULE" means any Governmental Rule which relates to
Hazardous Substances, pollution or protection of the environment, natural
resources or
public health or safety, including without limitation any Governmental Rule
relating to the generation, use, processing, treatment, storage, release,
transport or disposal of Hazardous Substances and any common laws of nuisance,
negligence and strict liability relating thereto, together with all rules,
regulations and orders issued thereunder, as of the date hereof and as of the
Closing Date.
"HAZARDOUS SUBSTANCE" means any substance which constitutes, in
whole or in part, a pollutant, contaminant or toxic or hazardous substance or
waste under, or the generation, use, processing, treatment, storage, release,
transport or disposal of which is regulated by, any Governmental Rule.
3.18. COMPANY REAL PROPERTY.
(a) SCHEDULE 3.18 sets forth a correct and complete list of all
real property currently owned or leased by Company. Except as otherwise
disclosed on SCHEDULE 3.18, all buildings and other improvements located on such
property are in good repair and operating condition.
(b) SCHEDULE 3.18 sets forth a correct and complete list of all
leases, subleases and other material agreements or rights pursuant to which any
Person has the right to occupy or use any real property owned by Company.
(c) SCHEDULE 3.18 sets forth a correct and complete list of all
leases, subleases and other material agreements or rights pursuant to which
Company has the right to occupy or use any real property owned by others,
together with the names of the lessors or other grantors thereunder, the
location of the property covered thereby, the annual rental or other
consideration payable thereunder and the duration thereof, including any renewal
options.
3.19. COMPANY PERSONAL PROPERTY.
(a) SCHEDULE 3.19 sets forth a correct and complete list of all
leases and other agreements pursuant to which Company leases any equipment,
machinery, trade fixtures, tools, vehicles, computer hardware, computer software
or furniture for amounts in excess of $500 (collectively, "EQUIPMENT"), together
with the names of the lessors thereunder, the personal property covered thereby,
the annual rental thereunder and the duration thereof, including any renewal
options.
(b) Except as otherwise disclosed on SCHEDULE 3.19, all Equipment
owned or leased by Company, or otherwise used by Company in its business, is in
good repair and operating condition, is suitable for the purposes for which it
is used and constitutes all Equipment necessary to conduct Company's business as
currently conducted.
(c) Except as otherwise disclosed on SCHEDULE 3.19, all raw
material, work-in-process and finished goods and inventory of Company (i) is in
all material respects of a quantity and quality usable and saleable in the
ordinary course of business and (ii) except for such items acquired or produced
after the Company Financial Statement Date, is reflected on the Company Current
Financial Statements at the lower of cost (determined on a first-in, first-out
basis) or market in accordance with GAAP applied on a consistent basis, with
adequate provisions or adjustments having been made for excess and slow-moving
inventory and inventory obsolescence and shrinkage.
(d) Except as otherwise disclosed on SCHEDULE 3.19, all of
Company's accounts receivable (i) represent amounts receivable for goods
actually delivered or services actually provided (or, in the case of non-trade
receivables, represent amounts receivable in respect of other bona fide business
transactions), (ii) are not subject to any material defenses, counterclaims or
rights of setoff, (iii) have been billed and are generally due and payable
within 30 days after billing and (iv) are fully collectible in the ordinary
course of business except, in the case of receivables arising prior to the
Company Financial Statement Date, to the extent of the reserves set forth in the
Company Current Financial Statements and, in the case of receivables arising
after such date, to the extent of a reasonable allowance for bad debts. SCHEDULE
3.19 sets forth the total amount of Company's accounts receivable outstanding as
of November 30, 1998, together with the aging of such receivables, from the due
date thereof, based on the following schedule: 0-30 days; 61-90 days; and over
90 days.
3.20. COMPANY INTELLECTUAL PROPERTY. SCHEDULE 3.20 sets forth a correct
and complete list of (a) all patents, registered or unregistered trademarks,
service marks, logos, corporate and trade names and registered and common law
copyrights, and all applications therefor, which are owned by or licensed to
Company, or are otherwise used by Company in its business (collectively,
"COMPANY INTELLECTUAL PROPERTY"), (b) all licenses or other agreements pursuant
to which any Person has the right to use any Company Intellectual Property owned
by Company, together with the names of the licensees thereunder, Company
Intellectual Property covered thereby, the annual fee or other consideration
payable thereunder and the duration thereof, including any renewal options, (c)
all licenses or other agreements pursuant to which Company has the right to use
any Company Intellectual Property owned by others, together with the names of
the licensors thereunder, Company Intellectual Property covered thereby, the
annual fee or other consideration payable thereunder and the duration thereof,
including any renewal options and (d) all consents which must be obtained, all
filings which must be made and all other actions which must be taken in order to
assign or otherwise transfer Company's rights in any of the foregoing to Parent.
Company has the lawful right to use all of the Company Intellectual Property,
and no such use infringes upon the lawful rights of any other Person. To the
best of Company Parties' knowledge, no Person is using any Company Intellectual
Property in a manner which infringes upon the lawful rights of Company.
3.21. TITLE TO COMPANY ASSETS. Except as otherwise disclosed on
SCHEDULE 3.21, Company has (a) good and marketable title to all assets purported
to be owned by it and (b) good leasehold title to all assets purported to be
leased by it, in each case free and clear of all liens, claims and encumbrances
of any nature whatsoever (collectively, "LIENS"). All of such Liens will be
removed on or prior to the Effective Time, other than Liens designated as
"Permitted Liens" on SCHEDULE 3.21.
3.22. COMPANY PENSION PLANS. SCHEDULE 3.22 sets forth a true, correct
and complete list of all Company Pension Plans. Except as otherwise disclosed on
SCHEDULE 3.22:
(a) the IRS has issued favorable determination letters to the
effect that each Company Pension Plan is qualified within the meaning of Section
401 of the Internal Revenue Code of 1986, as amended (the "CODE"), and that each
related trust is exempt under Section 501 of the Code, correct and complete
copies of which have been delivered to Parent and Sub, and Company Parties have
no knowledge of any fact which may adversely affect the qualified status of any
Company Pension Plan or related trust;
(b) each Company Pension Plan and each related trust has been
established, maintained and administered in all material respects in compliance
with ERISA, the Code and all other applicable Governmental Rules, including
without limitation all minimum funding requirements of ERISA and the Code;
(c) none of the transactions described in Section 406 of ERISA or
Section 4975 of the Code, and none of the events described in Section 4043 of
ERISA, have occurred with respect to any Company Pension Plan;
(d) no "unfunded benefit liability" within the meaning of Section
4001(a)(16) of ERISA, and no "accumulated funding deficiency" within the meaning
of Section 302 of ERISA or Section 412(a) of the Code, exists with respect to
any Company Pension Plan;
(e) no Company Pension Plan has been terminated in whole or in
part, neither Company nor any Company ERISA Affiliate presently intends to
terminate any Company Pension Plan in whole or in part, no proceeding has been
commenced by the Pension Benefit Guaranty Corporation (the "PBGC") or the IRS to
terminate any Company Pension Plan in whole or in part or to appoint a trustee
to administer any Company Pension Plan, neither Company nor any Company ERISA
Affiliate has received any notice of any such proceeding and Company Parties
have no knowledge of any basis for the commencement of any such proceeding;
(f) neither Company nor any Company ERISA Affiliate owes any
amount to the PBGC other than for PBGC insurance premiums which are not yet due
and payable;
(g) neither Company nor any Company ERISA Affiliate has
contributed to, or is or has been under any obligation to contribute to, any
Multiemployer Plan;
(h) Company has delivered to Parent and Sub correct and complete
copies of (i) IRS Form 5500 most recently filed with respect to each Pension
Plan, (ii) the summary plan description for each Company Pension Plan and (iii)
the most recent actuarial valuation report for each Company Pension Plan; all
information provided by Company to the actuary in connection with such actuarial
reports was correct and complete, all actuarial assumptions used in computing
accrued employee benefits and liabilities, whether or not vested, and asset
values under each Company Pension Plan were reasonable and in compliance with
applicable Governmental Rules, the total actuarial present value of the
accumulated benefits under each Company Pension Plan, whether or not vested,
does not exceed the fair market value of the assets of such Company Pension Plan
and the value of the assets of each Company Pension Plan have not decreased
since the date of the most recent actuarial valuation report with respect to
such Company Pension Plan;
(i) there are no actions, suits, investigations or other
proceedings pending or, to the best of Company Parties' knowledge, threatened
against any Company Pension Plan or related trust or any fiduciary thereof, and
Company Parties have no knowledge of any basis for the commencement of any such
proceeding; and
(j) there are no outstanding Governmental Orders which name any
Company Pension Plan or its fiduciaries or are directed to any Pension Plan or
its fiduciaries or assets.
As used in this Agreement, the following terms have the following
meanings:
"ERISA" means the Employee Retirement Income Security Act of 1974
and all rules, regulations and orders issued thereunder, as any of the same may
be amended as of the date hereof and as of the Closing Date.
"COMPANY ERISA AFFILIATE" means any trade or business which,
together with Company, is treated as a single employer under Section 4001(b)(1)
of ERISA or Sections 414(b), (c), (m) or (o) of the Code.
"COMPANY PENSION PLAN" means any "employee pension benefit plan"
as defined in Section 3(2) of ERISA (i) which is maintained for past or present
employees of Company or any
Company ERISA Affiliate or (ii) to which Company or any Company ERISA Affiliate
made, or was required to make, contributions within the preceding five years, as
any of the same may be amended.
"MULTIEMPLOYER PLAN" means a "multiemployer plan" as defined in
Section 4001(a)(3) of ERISA.
3.23. COMPANY WELFARE PLANS. SCHEDULE 3.23 sets forth a correct and
complete list of all Company Welfare Plans. Except as otherwise disclosed on
SCHEDULE 3.23: (a) each Company Welfare Plan has been established, maintained
and administered in all material respects in compliance with ERISA, the Code and
all other applicable Governmental Rules; and (b) all payments which Company is
required to make in respect of any Company Welfare Plan on or prior to the date
hereof have been made. As used in this Section, "COMPANY WELFARE PLAN" means any
"employee welfare benefit plan" as defined in Section 3(1) of ERISA (i) which is
maintained for past or present employees of Company or any Company ERISA
Affiliate or (ii) to which Company or any Company ERISA Affiliate made, or was
required to make, contributions within the preceding five years, as any of the
same may be amended.
3.24. COMPANY PERSONNEL MATTERS.
(a) SCHEDULE 3.24 sets forth a correct and complete list of (i)
all directors and executive officers of Company, (ii) all other employees of or
consultants to Company whose annual compensation (including bonuses and
commissions) during Company's calendar year ended December 31, 1997 was $10,000
or more, (iii) the current job title or relationship to Company of each Person
described in clauses (i) and (ii) above, (iv) the amount of compensation
(including bonuses and commissions) paid to each such Person during Company's
calendar year ended December 31, 1997 and which each of them is expected to
receive in Company current fiscal year and (v) any employee benefits or
perquisites available to any such Person that are not generally available to
employees of Company.
(b) Except as otherwise disclosed on SCHEDULE 3.24, Company is
not a party to any employment, consulting or similar agreement, written or oral,
with any Person.
(c) Except as otherwise disclosed on SCHEDULE 3.24, (i) no
employees of Company are represented by any labor union or similar organization,
(ii) Company is not party to any collective bargaining or similar agreement
covering any of its employees and (iii) no labor union or similar organization
or group of employees has made a demand for recognition, filed a petition
seeking a representation proceeding or given Company notice of any intention to
hold an election of a collective bargaining representative at any time during
the past three years.
(d) Except as otherwise disclosed on SCHEDULE 3.24, (i) no
strike, work stoppage, contract dispute or other labor disturbance involving any
employees of Company currently exists or, to the best of Company Parties'
knowledge, is threatened and (ii) no investigation, action or proceeding by or
before any governmental entity which relates to allegedly unfair or
discriminatory employment or labor practices or the violation of any
Governmental Rule relating to employment or labor practices is pending or, to
the best of Company Parties' knowledge, threatened, and Company Parties have no
knowledge of any basis for any such investigation, action or proceeding.
3.25. COMPANY INSURANCE.
(a) SCHEDULE 3.25 sets forth a correct and complete list of all
insurance policies of which Company is the owner, insured or beneficiary and
indicates for each such policy any pending claims thereunder.
(b) The coverage provided by such policies is reasonable in the
judgment of the management of the Company, in both scope and amount, in light of
the value of its assets and the risks attendant to its business and is
comparable to coverage customarily maintained by others in similar lines of
business. There is no default with respect to any provision contained in any
such policy, nor has there been any failure to give any notice or present any
material claim under any such policy in a timely fashion or as otherwise
required by such policy.
(c) Except as otherwise disclosed on SCHEDULE 3.25: (i) all
premiums under such policies which were due and payable on or prior to the date
hereof have been paid in full; (ii) no such policy provides for retrospective or
retroactive premium adjustments; (iii) Company has not received notice of any
material increase in the premium under, cancellation or non-renewal of or
disallowance of any claim under any such policy; (iv) Company has not been
refused any insurance, nor has its coverage been limited by any carrier; and (v)
since January 1, 1994 Company has maintained, or been the beneficiary of,
general liability and product liability policies reasonable, in both scope and
amount in the judgment of the management of the Company, in light of the risks
attendant to its business and which provide coverage comparable to coverage
customarily maintained by others in similar lines of business, and such policies
have been "occurrence" policies and not "claims made" policies.
3.26. COMPANY INDEBTEDNESS.
(a) SCHEDULE 3.26 sets forth a complete list of all agreements,
documents, instruments and securities which are currently in effect and which
create, evidence or secure any indebtedness of Company (exclusive of trade
payables) or pursuant to which Company has guaranteed any indebtedness or other
obligations of any other Person, together with the names of the creditors
thereunder or beneficiaries
thereof, the principal amount owing thereunder or secured or guaranteed thereby,
the interest rates payable thereunder and the amortization and maturity thereof.
(b) SCHEDULE 3.26 sets forth a correct and complete list of all
outstanding trade payables of Company, payment of which is more than 30 days
overdue and, with respect to any trade payables which have not been paid due to
a dispute with a vendor, identifies the nature of such dispute.
3.27. OTHER MATERIAL COMPANY BUSINESS AGREEMENTS. SCHEDULE 3.27 sets
forth a correct and complete list of all bids, offers, leases, licenses,
contracts and other business arrangements, written or oral, to which Company is
a party or by which Company or any of its assets are bound (collectively,
"COMPANY BUSINESS AGREEMENTS") other than (a) Company Business Agreements listed
on any of SCHEDULE 3.18 through SCHEDULE 3.26, (b) Company Business Agreements
involving the payment by or to Company, or creating any liability of Company
(whether direct or indirect, fixed or contingent), of less than $10,000 over the
term thereof (exclusive of agreements which do not involve the payment of money
by either party) and (c) Company Business Agreements which are cancelable by
Company on 30 days' notice or less without any material liability to Company,
together with descriptions of Subject matter thereof, the names of the other
parties thereto, the amount of any payments or liabilities thereunder, the
duration thereof, including any renewal options.
3.28. STATUS OF COMPANY BUSINESS AGREEMENTS. Each Company Business
Agreement listed on any of SCHEDULE 3.18 through SCHEDULE 3.27 is in full force
and effect and is enforceable against Company and, to the best of Company
Parties' knowledge, the other parties thereto, in accordance with its terms.
Company is in compliance with each such Company Business Agreement, except, in
each case, for such non-compliance as does not (a) constitute a breach or
default (or an event which, with the giving of notice or the passage of time, or
both, would constitute a default) thereunder or (b) give to others any rights of
termination, acceleration, suspension, revocation, cancellation or amendment
thereof. To the best of Company Parties' knowledge, all other parties to such
Company Business Agreements are in substantial compliance with the terms
thereof. Except as otherwise disclosed on SCHEDULE 3.28, each Company Business
Agreement may be transferred without the consent of any other Person.
3.29. WARRANTY AND PRODUCT LIABILITY. Company has previously delivered
to Parent and Sub a correct and complete copy of each express warranty under
which it has any warranty obligations. SCHEDULE 3.29 sets forth:
(a) a correct and complete list of all product lines manufactured
or sold, and all services performed, by Company with respect to which Company
may have any liability, whether on account of warranty obligations, product
liability claims or otherwise;
(b) the number of warranty claims which have been made against
Company on account of such products and services during the five-year period
ended November 30, 1998, together with the amount expended by Company in each of
such years in satisfying such claims, the number of such claims outstanding on
the date hereof and the amount which Company reasonably believes will be
necessary to satisfy such outstanding claims; and
(c) the number of product liability claims which have been made
against Company on account of such products during the five-year period ended
November 30, 1998, together with the amount expended by Company in each of such
years in defending against and/or satisfying such claims, the number of such
claims outstanding on the date hereof and the amount which Company reasonably
believes will be necessary to defend against and/or satisfy such outstanding
claims.
3.30. TRANSACTIONS WITH COMPANY AFFILIATES. Except as otherwise
disclosed on SCHEDULE 3.30: (a) none of the customers, suppliers, distributors
or sales representatives of Company are Affiliates of Company or any of its
officers, directors or shareholders; (b) none of the assets of Company are owned
or used by or leased to any Affiliates of Company or any of its officers,
directors or shareholders; (c) no Affiliate of Company or any of its officers,
directors or shareholders is a party to any Company Business Agreement; and (d)
no Affiliate of Company or any of its officers, directors or shareholders
provides any legal, accounting or other services to Company. As used in this
Agreement, the term "AFFILIATE" means, with respect to any Person, (i) any
director, officer, employee, shareholder, partner or principal of such Person,
(ii) any other Person of which such Person is a director, officer, employee,
shareholder, partner or principal, (iii) any Person who directly or indirectly
controls or is controlled by, or is under common control with, such Person and
(iv) with respect to any Person described above who is a natural person, any
spouse and any relative (by blood, adoption or marriage) within the third degree
of consanguinity of such Person, and the term "CONTROL" shall mean, with respect
to any Person, the possession, direct or indirect, of the power to direct or
cause the direction of the management and policies of such Person, whether
through ownership of voting securities, by contract or otherwise.
3.31. BROKERS. Company Parties have not employed or retained, and has
no liability to, any broker, agent or finder on account of this Agreement or any
of the other Transaction Documents or the transactions contemplated hereby or
thereby.
3.32. YEAR 2000. Except as set forth on SCHEDULE 3.32, Company and its
Management and Production Systems (each as herein defined, together the
"SYSTEMS") are each Year 2000 Compliant, except for failure to be Year 2000
Compliant which could not reasonably be expected to have a Company Material
Adverse Effect.
(a) "YEAR 2000 COMPLIANT" means that neither the year change from
1999 to 2000 (the arrival of the date "January 1, 2000") nor leap year dates
thereafter:
(i) will impair Company's ability to meet its obligations to
its customers, suppliers, vendors, agents and/or
creditors; or
(ii) will result in errors or corruption in processing data
or otherwise have an abnormal or adverse effect on the
operations or functionality of Company or its Systems,
all of which will continue to operate as intended prior
to, during and after January 1, 2000.
(b) "MANAGEMENT SYSTEMS" include, without limitation, all
computer hardware (including integrated circuit/chip and firmware) and software
applications that Company uses for managing and operating Company and its
business, including without limitation, functions such as accounting and
billing, invoicing/accounts receivable and accounts payable, inventory tracking
and maintenance, and vendor and supplier sourcing.
(c) "PRODUCTION SYSTEMS" include, without limitation, all
computer hardware (including integrated circuit/chip and firmware) and software
applications, and all automated or electronic equipment, controls and other
systems used by Company in its production process, from the point of input of
raw material to final products/goods and/or material offered for sale or trade
to customers.
(d) Except as set forth on SCHEDULE 3.32, the Company Parties
represent and warrant that all of the Company's products that have been sold or
licensed by the Company or by an authorized distributor or sublicensed by a
third party licensor to third parties (the "PRODUCTS") from January 1, 1996 to
the Closing Date (the "Y2K WARRANTY PERIOD") are, and have been throughout the
entire X0X Xxxxxxxx Period, designed to be used prior to, during, and after the
calendar year 2000 A.D., and that the Products will operate prior to, during,
and after the calendar year 2000 A.D. without error relating to use,
calculation, manipulation or display of date data, specifically including any
error relating to, or the product of, date data which represents or references
different centuries or more than one century including leap year dates therein.
3.33. DELIVERY OF DOCUMENTS; ACCURATE DISCLOSURE. Company has
previously delivered to Parent and Sub correct and complete copies of each
Company Business Agreement listed on SCHEDULE 3.18 through SCHEDULE 3.27 and of
each additional agreement, document and instrument which Parent or Sub (or its
accountants or attorneys) has requested in writing. None of the information
furnished or to be furnished by Company Parties to Parent or Sub or any of its
representatives in connection with this Agreement and the other Transaction
Documents, and none of the
representations and warranties of Company Parties set forth herein, in any other
Transaction Document or in any certificate delivered in connection herewith or
therewith, (a) is or will be false or misleading in any material respect, (b)
contains or will contain any untrue statement of a material fact or (c) omits or
will omit any statement of material fact necessary to make the same not
misleading.
ARTICLE IV
REPRESENTATIONS AND WARRANTIES OF PARENT AND SUB
------------------------------------------------
Parent and Sub hereby represent and warrant to Company and Shareholders
as follows:
4.01. ORGANIZATION AND QUALIFICATION. Each of Parent and Sub is a
corporation duly organized, validly existing and in good standing in the State
of Delaware. Each of Parent and Sub is duly qualified to do business as a
foreign corporation and is in good standing in the jurisdictions listed on
SCHEDULE 4.01, which are all jurisdictions in which the ownership of their
respective properties or the nature of their respective businesses makes such
qualification necessary, except to the extent that the failure to be so
qualified has not resulted in, and is not likely to result in, a material
adverse change in the business, operations, financial condition or prospects of
either Parent or Sub (a "PARENT MATERIAL ADVERSE CHANGE").
4.02. AUTHORITY AND AUTHORIZATION. Parent and Sub have the corporate
power and authority to own their respective properties and assets, to conduct
their respective businesses as presently conducted and to execute, deliver and
perform this Agreement and the other Transaction Documents.
4.03. EXECUTION AND BINDING EFFECT. This Agreement has been, and on the
Closing Date the other Transaction Documents will be, duly and validly executed
and delivered by Parent and Sub and constitute (or upon such execution and
delivery will constitute) legal, valid and binding obligations of Parent and Sub
enforceable against Parent and Sub in accordance with their respective terms.
4.04. NO BREACH, DEFAULT, VIOLATION OR CONSENT. The execution, delivery
and performance by Parent and Sub of this Agreement and the other Transaction
Documents do not and will not:
(a) violate the charter or by-laws of Parent or Sub;
(b) breach or result in a default (or an event which, with the
giving of notice or the passage of time, or both, would constitute a default)
under, require any consent under or give to others any rights of termination,
acceleration, suspension, revocation, cancellation or amendment of any contract,
agreement, instrument or
document to which either Parent or Sub or any of their respective properties or
assets are bound;
(c) breach or otherwise violate any Governmental Order which
names Parent or Sub or is directed to Parent or Sub or any of their respective
assets;
(d) violate any Governmental Rule; or
(e) require any consent, authorization, approval, exemption or
other action by, or any filing, registration or qualification with, any Person.
4.05. OWNERSHIP AND CONTROL. SCHEDULE 4.05 sets forth a correct and
complete list of (a) the authorized capitalization of Parent and Sub, (b) the
number of shares of each class of capital stock of Parent issued and outstanding
("PARENT COMMON STOCK"), and (c) the number of shares of each class of Sub
Common Stock issued and outstanding. The issued and outstanding shares of the
capital stock of Parent Common Stock and Sub Common Stock have been duly
authorized and validly issued and are fully paid and non-assessable. Except as
otherwise disclosed on SCHEDULE 4.05, there are no outstanding (x) options,
warrants, agreements or other rights for the acquisition of shares of Parent
Common Stock and Sub Common Stock, (y) securities or other obligations of Parent
and Sub which are convertible into such shares or (z) to the best of Parent's
and Sub's knowledge, options, sale agreements, shareholder agreements, pledges,
proxies, voting trusts, powers of attorney, restrictions on transfer or other
agreements or instruments which are binding on any of the shareholders of Parent
and Sub and which relate to the ownership, voting or transfer of any of such
shares.
4.06. SUBSIDIARIES. Except as set forth on SCHEDULE 4.06, Parent has no
Subsidiaries except for Sub. Sub has no Subsidiaries.
4.07. FINANCIAL STATEMENTS. Parent has previously delivered to Company
correct and complete copies of (a) its audited balance sheets and statements of
income, retained earnings and cash flow as of and for its fiscal years ended
December 31, 1997, 1996 and 1995, including the footnotes thereto, and (b) its
unaudited interim balance sheets and statements of income, retained earnings and
cash flow as of and for its fiscal quarters ended November 30, 1998 (the "PARENT
CURRENT FINANCIAL STATEMENTS" and, together with the items described in clause
(a) above, the "PARENT FINANCIAL STATEMENTS"). The Parent Financial Statements
present fairly the financial condition of Parent as at the end of the periods
covered thereby and the results of its operations and the changes in its
financial position for the periods covered thereby, and were prepared in
accordance with GAAP applied on a consistent basis throughout the periods
covered thereby subject, in the case of the Parent Current Financial Statements,
to year-end audit adjustments (which will not be material except as otherwise
disclosed on SCHEDULE 4.07) and the lack of footnotes and other presentation
items. Except as and to the extent otherwise disclosed in the Parent Current
Financial Statements and on SCHEDULE 4.07,
Parent has no material liabilities of any kind, whether direct or indirect,
fixed or contingent or otherwise, other than (x) liabilities under Parent
Business Agreements which are not required to be set forth on the Parent Current
Financial Statements in accordance with GAAP and (y) liabilities incurred in the
ordinary course of business since September 30, 1998 (the "PARENT FINANCIAL
STATEMENT DATE").
4.08. LITIGATION. Except as otherwise disclosed on SCHEDULE 4.08, there
is no pending or, to the best of Parent's and Sub's knowledge, threatened
investigation, action or proceeding against Parent or Sub or any of their
respective assets by or before any governmental entity or arbitrator which, if
determined adversely to Parent or Sub, would materially and adversely affect its
ability to consummate the transactions contemplated hereby, and neither Parent
nor Sub have any knowledge of any basis for any such action, proceeding or
investigation. SCHEDULE 4.08 sets forth a correct and complete list of each
investigation, action and proceeding described in the preceding sentence, the
parties thereto, the alleged basis therefor, the relief sought therein and the
current status thereof.
4.09. ABSENCE OF CERTAIN CHANGES AND EVENTS. Except as otherwise
disclosed on SCHEDULE 4.09, since the Parent Financial Statement Date:
(a) Parent has not incurred any material obligation or liability
except for normal trade obligations incurred in the ordinary course of business;
(b) Parent has not sold, transferred or otherwise disposed of any
of its material assets or any interest therein, or agreed to do any of the
foregoing, except for sales of inventory in the ordinary course of business;
(c) Parent has not waived or released any of its material rights
with respect to its business or assets or permitted any of such rights to lapse;
(d) no executive officer or other key employee of Parent has left
his or her employment with Parent;
(e) Parent has not declared or paid any dividend or other
distribution in respect of its capital stock or agreed to do any of the
foregoing; and
(f) no Parent Material Adverse Change, and no event which, to the
best of Parent's knowledge, is likely to result in a Parent Material Adverse
Change, has occurred.
4.10. CONSTITUENT DOCUMENTS AND GOVERNMENTAL RULES. Parent and Sub are
in compliance with (a) their charter and by-laws and (b) all Governmental Rules
applicable to Parent and Sub and their respective businesses or assets, except,
in each
case, for such non-compliance as, individually or in the aggregate, has not
resulted in, and is not likely to result in, a Parent Material Adverse Change.
4.11. ENVIRONMENTAL MATTERS. Except as otherwise disclosed on SCHEDULE
4.11:
(a) no Hazardous Substances have been or are being generated,
used, processed, treated, stored, released, transported or disposed of by Parent
except in compliance with Environmental Rules;
(b) to the best of the Parent's knowledge, no Person who has
leased, occupied or used any real property now or previously owned, leased,
occupied or used by Parent generated, used, processed, treated, stored, released
or disposed of any Hazardous Substances on such property;
(c) no Hazardous Substances are present on or under any real
property (including without limitation in any body of water located thereon or
adjacent thereto or any groundwater located thereunder) now or previously owned,
leased, occupied or used by Parent, or in any improvement located thereon, in
quantities or at levels which require reporting or remediation under any
applicable Environmental Rule; and
(d) no event has occurred and no condition exists with respect to
Parent or its business or assets which has resulted in, or is likely to result
in, any material liability, cost or expense to Parent or any other Person who
owns or operates its business or assets under any applicable Environmental Rule,
and Parent has not received any notice from any governmental entity or other
Person of its intention to impose any such liability, cost or expense upon
Parent or any such Person.
4.12. BROKERS. Neither Parent nor Sub have employed or retained, and
neither has any liability to, any broker, agent or finder on account of this
Agreement or any of the other Transaction Documents or the transactions
contemplated hereby or thereby.
4.13. YEAR 2000. Except as set forth on SCHEDULE 4.13, Parent, Sub and
their respective Management and Production Systems (each as herein defined,
together the "SYSTEMS") are each Year 2000 Compliant, except for failure to be
Year 2000 Compliant which could not reasonably be expected to have a Company
Material Adverse Effect.
(a) "YEAR 2000 COMPLIANT" means that neither the year change from
1999 to 2000 (the arrival of the date "January 1, 2000") nor leap year dates
thereafter:
(i) will impair Company's ability to meet its obligations to
its customers, suppliers, vendors, agents and/or
creditors; or
(ii) will result in errors or corruption in processing data
or otherwise have an abnormal or adverse effect on the
operations or functionality of Company or its Systems,
all of which will continue to operate as intended prior
to, during and after January 1, 2000.
(b) "MANAGEMENT SYSTEMS" include, without limitation, all
computer hardware (including integrated circuit/chip and firmware) and software
applications that Company uses for managing and operating Company and its
business, including without limitation, functions such as accounting and
billing, invoicing/accounts receivable and accounts payable, inventory tracking
and maintenance, and vendor and supplier sourcing.
(c) "PRODUCTION SYSTEMS" include, without limitation, all
computer hardware (including integrated circuit/chip and firmware) and software
applications, and all automated or electronic equipment, controls and other
systems used by Company in its production process, from the point of input of
raw material to final products/goods and/or material offered for sale or trade
to customers.
(d) Except as set forth on SCHEDULE 4.13, Parent represents and
warrants that all of Parent's products that have been sold or licensed by Parent
or by an authorized distributor or sublicensed by a third party licensor to
third parties (the "PRODUCTS") from January 1, 1996 to the Closing Date (the
"Y2K WARRANTY PERIOD") are, and have been throughout the entire X0X Xxxxxxxx
Period, designed to be used prior to, during, and after the calendar year 2000
A.D., and that the Products will operate prior to, during, and after the
calendar year 2000 A.D. without error relating to use, calculation, manipulation
or display of date data, specifically including any error relating to, or the
product of, date data which represents or references different centuries or more
than one century including leap year dates therein.
4.14. DELIVERY OF DOCUMENTS; ACCURATE DISCLOSURE. Parent and Sub have
previously delivered to Company correct and complete copies of each agreement,
document and instrument which Company (or its accountants or attorneys) has
requested in writing. None of the information furnished or to be furnished by
Parent or Sub to Company or any of its representatives in connection with this
Agreement and the other Transaction Documents, and none of the representations
and warranties of Parent and Sub set forth herein, in any other Transaction
Document or in any certificate delivered in connection herewith or therewith,
(a) is or will be false or misleading in any material respect, (b) contains or
will contain any untrue statement of a material fact or (c) omits or will omit
any statement of material fact necessary to make the same not misleading.
ARTICLE V
TRANSACTIONS PRIOR TO CLOSING
-----------------------------
5.01. CONDUCT OF COMPANY BUSINESS PRIOR TO CLOSING. At all times prior
to the Closing Date Company shall:
(a) operate its business only in the ordinary course and
consistent with past practice;
(b) use its best efforts to preserve its business organization
intact, to keep available the services of its present officers and employees and
to preserve the good will of customers, suppliers and others having business
relations with it;
(c) maintain all assets consisting of real or personal property
in good repair and operating condition, ordinary wear and tear excepted;
(d) maintain in full force and effect all Company Business
Permits and all insurance policies;
(e) not enter into any contract or commitment except those made
in the ordinary course of business the terms of which are consistent with past
practice and reasonable in light of current conditions;
(f) not terminate, cause the termination of, amend, renew or
extend any Company Business Agreement unless in each case such action is in the
best interest of Company;
(g) not waive or release any of its rights or permit any of such
rights to lapse;
(h) not sell, transfer or otherwise dispose of any of its assets
or any interest therein or agree to do any of the foregoing, except for sales of
inventory in the ordinary course of business;
(i) not incur, make, assume or suffer to exist any Lien, tenancy
or other matter affecting title to any of its assets;
(j) not make, change or revoke any tax election or make any
agreement or settlement with any taxing authority;
(k) not merge or consolidate Company with or into any other
entity or agree to do any of the foregoing;
(l) not incur any indebtedness other than trade payables incurred
in the ordinary course of business, and not guarantee any indebtedness or other
obligations of any other Person;
(m) not grant or commit itself to grant any salary or wage
increases to any of its employees other than increases which it has committed
itself to grant prior to the date hereof, and not pay bonuses other than in
accordance with its normal practice;
(n) not make or commit itself to make any capital expenditures in
excess of $5,000;
(o) not issue or sell any of its capital stock or other
securities, not declare or pay any dividends or other distributions in respect
of any of its capital stock and not agree to do any of the foregoing;
(p) comply with applicable Governmental Rules in all material
respects;
(q) take no action, and use its best efforts to prevent the
occurrence of any event or the existence of any condition, which would result in
any of Company's representations and warranties herein not being true and
correct; and
(r) promptly inform Company of the occurrence of any event or the
existence of any condition which constitutes or, with the giving of notice or
the passage of time, or both, is likely to constitute, a Company Material
Adverse Change.
5.02. ACCESS TO INFORMATION. At all times prior to the Closing Date
each party shall furnish to the other party and its employees, counsel,
accountants and other agents and consultants (a) full access during normal
business hours to the properties, books and records and personnel of such party
and (b) all such information concerning such party as the other party may
reasonably request.
5.03. BEST EFFORTS. The parties agree to use their reasonable best
efforts to take or cause to be taken and to do or cause to be done all such
actions and things as shall be necessary or advisable, or as shall be reasonably
requested by the other party, in order to consummate the transactions
contemplated hereby and by the other Transaction Documents. Without limiting the
generality of the foregoing, the parties agree to take all reasonable actions
necessary in order to obtain any consent or approval of any third party,
including without limitation any governmental entity, which is required in
connection with this Agreement or the other Transaction Documents or any of the
transactions contemplated hereby or thereby.
5.04. DISCLOSURE SCHEDULES.
(a) Company and the Shareholders shall update the disclosure schedules
of Company and the Shareholders and all exhibits thereto to include all
information relevant to the disclosures therein which relates to events which
have occurred after the date hereof and until the Closing Date and modify or
correct the disclosures made therein. Company and the Shareholders shall deliver
a draft of such updated information to Parent and Sub three days prior to the
Closing Date and, subject to Parent's and Sub's acceptance of such information
pursuant to 6.01(l), shall deliver the final updated disclosure schedules on the
Closing Date.
(b) Parent and Sub shall update the disclosure schedules of Parent and
Sub and all exhibits thereto to include all information relevant to the
disclosures therein which relates to events which have occurred after the date
hereof and until the Closing Date and modify or correct the disclosures made
therein. Parent and Sub shall deliver a draft of such updated information to
Company and the Shareholders three days prior to the Closing Date and, subject
to Company's and the Shareholders' acceptance of such information pursuant to
6.02(k), shall deliver the final updated disclosure schedules on the Closing
Date.
ARTICLE VI
CLOSING CONDITIONS
------------------
6.01. CONDITIONS PRECEDENT TO OBLIGATIONS OF PARENT AND SUB. The
obligations of Parent and Sub hereunder to proceed with the Closing shall be
subject to the satisfaction on or prior to the Closing Date of each of the
following conditions precedent:
(a) ACCURACY OF REPRESENTATIONS AND WARRANTIES. The
representations and warranties of Company set forth herein shall be true and
correct on and as of the Closing Date with the same force and effect as though
made on and as of such date.
(b) PERFORMANCE AND COMPLIANCE. Company shall have performed or
complied in all material respects with each covenant and agreement to be
performed or complied with by it hereunder on or prior to the Closing Date.
(c) CONSENTS AND APPROVALS. Company shall have obtained or made
each consent, authorization, approval, exemption, filing, registration or
qualification, if any, listed on any Schedule hereto.
(d) LITIGATION. There shall be no pending or threatened action by
or before any governmental entity or arbitrator seeking to restrain, prohibit or
invalidate any of the transactions contemplated hereby or by any of the other
Transaction Documents or seeking monetary relief against Parent or Sub by reason
of the
consummation of such transactions, and there shall not be in effect any
Governmental Order which has such effect.
(e) COMPANY MATERIAL ADVERSE CHANGE. No event shall have occurred
and no condition shall exist which constitutes or, with the giving of notice or
the passage of time, or both, is likely to constitute, a Company Material
Adverse Change.
(f) OFFICER'S CERTIFICATE. Company shall have delivered to Parent
and Sub a certificate of its President dated the Closing Date and certifying
that each of the conditions specified in subsections (a), (b), (c), (d) and (e)
above have been met.
(g) SECRETARY'S CERTIFICATE. Company shall have delivered to
Parent and Sub a certificate of its Secretary dated the Closing Date and
certifying (i) that correct and complete copies of its charter and by-laws are
attached thereto, (ii) that correct and complete copies of each resolution of
its board of directors and shareholders approving this Agreement and the other
Transaction Documents to which it is a party and authorizing the execution
hereof and thereof and the consummation of the transactions contemplated hereby
and thereby are attached thereto and (iii) the incumbency and signatures of the
officers of Company authorized to execute and deliver this Agreement and the
other Transaction Documents to which Company is a party on behalf of Company.
(h) OPINION OF COUNSEL. Company shall have delivered to Parent
and Sub an opinion of Company's counsel dated the Closing Date and in the form
attached as EXHIBIT 6.01(h).
(i) OTHER TRANSACTION DOCUMENTS. Company, Shareholders and any
other parties thereto (other than Parent and Sub) shall have executed and
delivered to Parent and Sub the following documents and such other documents and
instruments, in form and substance satisfactory to Parent and Sub and their
respective counsel, as shall be necessary or desirable in order to consummate
the transactions contemplated hereby, each dated the Closing Date (together with
this Agreement and any agreements listed in Section 6.03(i), the "TRANSACTION
DOCUMENTS"):
(i) Employment and Non-Competition Agreement between the
Company and Xxxxx Xxxxxxx ("XXXXX XXXXXXX EMPLOYMENT AGREEMENT");
(ii) Employment and Non-Competition Agreement between the
Company and Xxxxxxxx Xxxxxxx ("XXXXXXXX XXXXXXX EMPLOYMENT AGREEMENT");
(iii) Release of the Shareholders' guaranty of Company's
existing line of credit (the "RELEASE");
(iv) Amendment to Lease Agreement dated September 30, 1991
between the Shareholders and Xxxxx Xxxxx (collectively, "LANDLORD") and Company
(the "LEASE") whereby (i) the term of the lease shall be amended to provide for
a lease of five years from the Closing Date with an option to renew for an
additional five year period upon mutually acceptable terms (which terms would
include a fair market value adjustment in rent), (ii) Company shall pay $18,000
per month to Landlord constituting the minimum monthly rent plus all of its
required contribution to General Operating Expenses (as defined in the Lease),
and (iii) Company may assign or sublet to a third party all or a part of the
Premises (as defined in the Lease), provided that Company remains liable under
the Lease (the "LEASE AMENDMENT");
(v) the Escrow Agreement; and
(vi) a Shareholder Certificate from each of the Shareholders
in the form attached hereto as EXHIBIT 6.01(i)(vi) (the "SHAREHOLDER
CERTIFICATES").
(j) COMPANY BUSINESS PERMITS. To the extent that any Company
Business Permits are not transferable to Parent or Sub, Parent or Sub shall have
obtained, or satisfied themselves that they will be able to obtain, business
permits in its own name that will permit Sub to own, operate or use Company's
business and assets to the same extent as Company.
(k) SHAREHOLDER APPROVAL. Sub shall have obtained such
shareholder approval of the Merger and the other transactions contemplated
hereby as is required under applicable Governmental Rules.
(l) ACCEPTANCE OF SUPPLEMENTAL DISCLOSURES. Parent and Sub shall
have accepted in writing any supplemental disclosures to Company's and the
Shareholders' disclosure schedules submitted by Company and/or the Shareholders
to Parent and Sub pursuant to Section 5.04(a).
6.02. CONDITIONS PRECEDENT TO OBLIGATIONS OF COMPANY. The obligations
of Company hereunder to proceed with the Closing shall be subject to the
satisfaction on or prior to the Closing Date of each of the following conditions
precedent:
(a) ACCURACY OF REPRESENTATIONS AND WARRANTIES. The
representations and warranties of Parent and Sub set forth herein shall be true
and correct on and as of the Closing Date with the same force and effect as
though made on and as of such date.
(b) PERFORMANCE AND COMPLIANCE. Parent and Sub shall each have
performed or complied in all material respects with each covenant and agreement
to be performed or complied with by them hereunder on or prior to the Closing
Date.
(c) CONSENTS AND APPROVALS. Parent and Sub shall have obtained or
made each consent, authorization, approval, exemption, filing, registration or
qualification, if any, listed on any Schedule hereto.
(d) LITIGATION. There shall be no pending or threatened action by
or before any governmental entity or arbitrator seeking to restrain, prohibit or
invalidate any of the transactions contemplated hereby or by any of the other
Transaction Documents or seeking monetary relief against Company by reason of
the consummation of such transactions, and there shall not be in effect any
Governmental Order which has such effect.
(e) PARENT MATERIAL ADVERSE CHANGE. No event shall have occurred
and no condition shall exist which constitutes or, with the giving of notice or
the passage of time, or both, is likely to constitute, a Parent Material Adverse
Change.
(f) OFFICER'S CERTIFICATES. Parent and Sub shall each have
delivered to Company a certificate of their respective President dated the
Closing Date and certifying that each of the conditions specified in subsections
(a), (b), (c), (d) and (e) above have been met.
(g) SECRETARY'S CERTIFICATES. Parent and Sub shall each have
delivered to Company a certificate of their respective Secretary dated the
Closing Date and certifying (i) that correct and complete copies of its charter
and by-laws are attached thereto, (ii) that correct and complete copies of each
resolution of its board of directors and shareholders approving this Agreement
and the other Transaction Documents to which it is a party and authorizing the
execution hereof and thereof and the consummation of the transactions
contemplated hereby and thereby are attached thereto and (iii) the incumbency
and signatures of the officers of Parent and Sub authorized to execute and
deliver this Agreement and the other Transaction Documents to which Parent and
Sub is a party on behalf of Parent and Sub.
(h) OPINION OF COUNSEL. Parent and Sub shall have delivered to
Company an opinion of their counsel dated the Closing Date and in the form
attached as EXHIBIT 6.02(h).
(i) OTHER TRANSACTION DOCUMENTS. Sub and any other parties
thereto (other than Company) shall have executed and delivered to Company the
following documents and such other documents and instruments, in form and
substance satisfactory to Company and its counsel, as shall be necessary or
desirable in order to consummate the transactions contemplated hereby, each
dated the Closing Date:
(i) Xxxxx Xxxxxxx Employment Agreement;
(ii) Xxxxxxxx Xxxxxxx Employment Agreement;
(iii) the Release;
(iv) the Lease Amendment;
(v) Escrow Agreement; and
(vi) the Shareholder Certificates.
(j) SHAREHOLDER APPROVAL. Company shall have obtained such
shareholder approval of the Merger and the other transactions contemplated
hereby as is required by applicable Governmental Rules.
(k) ACCEPTANCE OF SUPPLEMENTAL DISCLOSURES. Company and the
Shareholders shall have accepted in writing any supplemental disclosures to
Parent's and Sub's disclosure schedules submitted by Parent and Sub to Company
and the Shareholders pursuant to Section 5.04(b).
ARTICLE VII
NON-COMPETITION AND NON-SOLICITATION
------------------------------------
7.01. NON-COMPETITION AND NON-SOLICITATION.
(a) During the period commencing with the date hereof and ending
on the fifth anniversary of the Closing Date, each of the Shareholders and any
of their respective Affiliates shall not, directly or indirectly, (i) engage in
any Competing Business or (ii) own, be employed by, consult with or otherwise
render services to any Person who is engaged in any Competing Business;
provided, that the ownership of an equity interest of not more than 1% in a
publicly traded entity that is engaged in a Competing Business shall not
constitute a violation of this covenant.
(b) During the period commencing with the date hereof and ending
on the fifth anniversary of the Closing Date, each of the Shareholders and any
of their respective Affiliates shall not (i) solicit the trade of, or trade
with, any customer or supplier of Company or any of its Affiliates such that any
such customer or supplier reduces the amount of business which it does (or, but
for such solicitation, would do) with Company or any of its Affiliates or (ii)
solicit or induce any employee, distributor, sales representative, agent or
contractor of Company or any of its Affiliates to terminate his or its
employment or other relationship with Company or any of its Affiliates.
As used in this Agreement the following terms shall have the
following meanings:
"COMPETING BUSINESS" means any individual, corporation, partnership,
business or other entity which operates or attempts to operate a business which
designs, develops, produces or sells any products or services (collectively, the
"PRODUCTS") which are the same or similar to those produced, developed or sold
by the Company in the fields of (a) radiation therapy, including conformal
radiation therapy, also including, but not specifically limited to, Peacock,
CORVUS, BAT and other systems developed by the Company and (b) the development
and marketing of computer systems used for oncology radiation therapy.
"TERRITORY" means any state in the United States, any Canadian province
and any foreign country, in each case in which Company or any of its Affiliates
has marketed or sold any Products at any time during the three-year period
immediately prior to the date hereof.
7.02 EQUITABLE RELIEF. Shareholders acknowledge and agree that Company
would be irreparably damaged if any of the provisions of Section 7.01 are not
performed in accordance with their specific terms or are otherwise breached.
Accordingly, it is agreed that Sub shall be entitled to an injunction or
injunctions to prevent breaches of Section 7.01 and shall have the right to
specifically enforce Section 7.01 and the terms and provisions thereof against
Shareholders in addition to any other remedy to which the Sub may be entitled
hereunder, at law or in equity.
7.03. SEVERABILITY. It is the intent of the parties that each provision
of Section 7.01 be enforced to the fullest extent permissible under the laws and
public policies of each jurisdiction in which enforcement of Section 7.01 is
sought. In furtherance of the foregoing, each provision of Section 7.01 shall be
severable from each other provision, and any provision thereof which is
unenforceable in any jurisdiction shall be subject to the following:
(a) if such provision is contrary to or conflicts with any
requirement of any statute, rule or regulation in effect in such jurisdiction,
then such requirement shall be incorporated into, or substituted for, such
unenforceable provision to the minimum extent necessary to make such provision
enforceable;
(b) the court, agency or arbitrator considering the matter is
hereby authorized to (or, if such court, agency or arbitrator is unwilling or
fails to do so, then the parties shall) amend such provision to the minimum
extent necessary to make such provision enforceable, and the parties hereby
consent to the entry of an order so amending such provisions; and
(c) if any such provision cannot be or is not reformed and made
enforceable pursuant to subsection (a) or (b) above, then such provision shall
be ineffective in such jurisdiction to the minimum extent necessary to make the
remainder of Section 7.01 enforceable in such jurisdiction.
Any application of the foregoing provisions to any provision of Section
7.01 shall not (x) affect the validity or enforceability of any other provision
thereof or (y) prevent such provision from being enforced as written in any
other jurisdiction.
ARTICLE VIII
INDEMNIFICATION
---------------
8.01. INDEMNIFICATION BY COMPANY PARTIES. Company (if the Closing does
not occur) or Shareholders (if the Closing occurs) shall defend, indemnify and
hold harmless the Sub and the Parent and their respective directors, officers,
employees and agents (each a "COMPANY INDEMNITEE") from and against any and all
claims, damages, losses, liabilities, costs and expenses (including without
limitation reasonable attorneys' fees and court costs) that constitute, or arise
out of or in connection with:
(a) any representation or warranty of the Company Parties set
forth herein in any other Transaction Document or in any certificate delivered
in connection herewith or therewith having been false or misleading as of the
time when made (including by omission of information necessary to make such
representation or warranty not misleading);
(b) any default by the Company Parties in the performance or
observance of any of their covenants or agreements hereunder or under any other
Transaction Document to which any of the Company Parties is a party;
(c) any investigation by any governmental entity which arises out
of the conduct of the Company's business prior to the Closing Date;
(d) the involvement by any Company Indemnitee in any
investigation, action or other proceeding incident to any of the other matters
indemnified against; or
(e) any product shipped or manufactured by, or any services
provided by, Company prior to the Closing Date.
8.02. INDEMNIFICATION BY PARENT AND SUB. Parent and Sub shall defend,
indemnify and hold harmless Shareholders and their respective partners,
directors, officers, employees and agents (each a "PARENT INDEMNITEE") from and
against any and all claims, damages, losses, liabilities, costs and expenses
(including without limitation reasonable attorneys' fees and court costs) that
constitute, or arise out of or in connection with:
(a) any representation or warranty of Sub and/or Parent set forth
herein in any other Transaction Document or in any certificate delivered in
connection herewith or therewith having been false or misleading as of the time
when made
(including by omission of information necessary to make such representation or
warranty not misleading);
(b) any default by Sub and/or Parent in the performance or
observance of any of its covenants or agreements hereunder or under any other
Transaction Document; or
(c) the involvement by any Parent Indemnitee in any
investigation, action or other proceeding incident to any of the other matters
indemnified against.
8.03. REPRESENTATION, SETTLEMENT AND COOPERATION. If any investigation,
action or other proceeding described in Section 8.01(c) or 8.02(c) (each a
"PROCEEDING") is initiated against any Company Indemnitee or Parent Indemnitee
(each an "INDEMNITEE") and such Indemnitee intends to seek indemnification from
the Company Parties or Parent or Sub (each an "INDEMNITOR"), as applicable,
under this Article on account of its involvement in such Proceeding, then such
Indemnitee shall give prompt notice to the applicable Indemnitor of such
Proceeding; provided, that the failure to so notify such Indemnitor shall not
relieve such Indemnitor of its obligations under this Article but shall reduce
such obligations by the amount of damages or increased costs and expenses
attributable to such failure to give notice. Upon receipt of such notice, such
Indemnitor shall diligently defend against such Proceeding on behalf of such
Indemnitee at its own expense using counsel reasonably acceptable to such
Indemnitee; provided, that if such Indemnitor shall fail or refuse to conduct
such defense, or such Indemnitee has been advised by counsel that it may have
defenses available to it which are different from or in addition to those
available to such Indemnitor, or that its interests in such Proceeding are
adverse to such Indemnitor's interests, then such Indemnitee may defend against
such Proceeding at such Indemnitor's expense. Such Indemnitor or Indemnitee, as
applicable, may participate in any Proceeding being defended against by the
other at its own expense, and shall not settle any Proceeding without the prior
consent of the other, which consent shall not be unreasonably withheld. Such
Indemnitor and Indemnitee shall cooperate with each other in the conduct of any
such Proceeding.
8.04. NOTICE AND SATISFACTION OF INDEMNIFICATION CLAIMS.
Indemnification claims against the Company Parties shall be satisfied out of the
Escrow Fund, or by set-off against any amounts due to Shareholders under Section
2.02 (but only to the extent such amounts are actually due and payable), prior
to being satisfied out of any other funds of Shareholders. No indemnification
claim shall be deemed to have been asserted until the applicable Indemnitor has
been given notice by the Indemnitee of the amount of such claim and the facts on
which such claim is based or, in the case of claims to be satisfied out of the
Escrow Fund, such other notice as is required by the Escrow Agreement.
Indemnification claims (other than those satisfied out of the Escrow Fund or by
set-off) shall be paid within 30 days after the Indemnitor's receipt of such
notice
and such evidence of the amount of such claim and the Indemnitor's liability
therefor as the Indemnitor may reasonably request.
8.05. DURATION OF COMPANY PARTIES' INDEMNIFICATION OBLIGATIONS. Claims
for indemnification under Section 8.01 may only be asserted within the following
time periods:
(a) claims arising out of or in connection with any
misrepresentation or breach of warranty or covenant under Section 3.10 (Tax
Matters) may be asserted until 60 days after the running of the statute of
limitations applicable to the taxable period to which a particular claim
relates;
(b) claims arising out of or in connection with any
misrepresentation or breach of warranty or covenant under Section 3.17
(Environmental Matters) may be asserted until 60 days after the running of the
statute of limitations applicable to such claim;
(c) claims arising out of or in connection with any
misrepresentation or breach of warranty under Section 3.21 (Title Matters) may
be asserted at any time;
(d) claims arising out of or in connection with any intentional
misrepresentation may be asserted at any time;
(e) claims arising out of or in connection with any Proceeding
may be asserted at any time during the time period during which the Indemnitee
would be permitted to assert a claim with respect to the matter which such
Proceeding is incident to and, with respect to Proceedings which are commenced,
but not concluded, during such time period, until 60 days after the conclusion
of any such Proceeding (including any appeals resulting therefrom); and
(f) all other claims may be asserted at any time on or prior to
the date that is 180 days after the second anniversary of the Closing Date.
8.06. DURATION OF INDEMNIFICATION OBLIGATIONS OF PARENT AND SUB. Claims
for indemnification under Section 8.02 may only be asserted within the following
time periods:
(a) claims arising out of or in connection with any
misrepresentation or breach of warranty or covenant under Section 4.11
(Environmental Matters) may be asserted until 60 days after the running of the
statute of limitations applicable to such claim;
(b) claims arising out of or in connection with any intentional
misrepresentation may be asserted at any time;
(c) claims arising out of or in connection with any Proceeding
may be asserted at any time during the time period during which the Indemnitee
would be permitted to assert a claim with respect to the matter which such
Proceeding is incident to and, with respect to Proceedings which are commenced,
but not concluded, during such time period, until 60 days after the conclusion
of any such Proceeding (including any appeals resulting therefrom); and
(d) all other claims may be asserted at any time on or prior to
the third anniversary of the Closing Date.
8.07. INDEMNIFICATION THRESHOLD. Notwithstanding any other provision
hereof, no Indemnitor shall have any indemnification obligations under this
Article unless and until the claims asserted against such Indemnitor exceed
$50,000 in the aggregate (the "THRESHOLD AMOUNT"); thereafter, such Indemnitor
shall be liable for all indemnification claims properly asserted against it,
except for $25,000, representing one-half of the Threshold Amount.
8.08. INDEMNIFICATION CAP.
(a) COMPANY PARTIES. The indemnification obligations of the
Company Parties under Section 8.01 shall not exceed the Indemnification Cap (as
hereinafter defined).
(b) PARENT AND SUB. The indemnification obligations of the Parent
and the Sub under Section 8.02, shall not exceed the Indemnification Cap,
provided that such cap shall not be applicable to obligations under Section 8.02
if the representation and warranty out of which the obligation arose was an
intentional misrepresentation.
(c) INDEMNIFICATION CAP DEFINITION. For purposes of this Article
VIII, the term "INDEMNIFICATION CAP" shall mean $2,000,000 plus any amounts
received by the Shareholders as Earn-Out Fees plus the fair market value of any
Parent Common Stock received by the Shareholders. The "fair market value" of the
shares of Parent Common Stock for purposes of this Section 8.08(c) shall be as
follows (i) if any such shares of Parent Common Stock are sold by any of the
Shareholders, the fair market value of such shares of Parent Common Stock shall
be deemed to be the price at which such shares were sold, or (ii) for shares of
Parent Common Stock which have not been sold by the Shareholders, the fair
market value of such shares shall be determined as of the date on which any
claim is made (the "INDEMNIFICATION DATE") as set forth in subsection (d) below.
(d) DETERMINATION OF FAIR MARKET VALUE. The "fair market value"
of shares of Parent Common Stock for purposes of subsection (c)(ii) above will
be determined by agreement between Parent and the Shareholder(s) with an
indemnification obligation under subsection (a) above (the "INDEMNIFYING
SHAREHOLDER(S)"). If no such agreement is reached within 20 days after the
Indemnification Date, the fair market value of such Parent Common Stock will be
determined by appraisal as follows:
(i) The "fair market value" means the price which could
reasonably be obtained for all shares of Parent Common Stock (on a fully-diluted
basis) owned by the Indemnifying Shareholder(s) if all such shares of Parent
Common Stock were sold in a single arm's-length transaction, using valuation
techniques then prevailing in the industry and assuming a reasonable period of
time for effectuating such sale. The fair market value will be determined as of
the Indemnification Date.
(ii) Company and the Indemnifying Shareholder(s) will use
best efforts to agree upon the selection of an independent appraiser within 30
business days after the Indemnification Date. Such appraiser will have 20
business days in which to determine the fair market value, and its determination
thereof will be final and binding on all parties concerned. If Company and the
Indemnifying Shareholder(s) are unable to reach an agreement as to an
independent appraiser within 20 business days after the Indemnification Date,
then Company and the Indemnifying Shareholder(s) will each select one
independent appraiser within 5 days thereafter. Each of Company and such
Indemnifying Shareholder(s) will cause their appraiser to determine
independently the Company's fair market value within 20 days after their
appointment. If the lesser of the two appraised values (the "LOW VALUE") exceeds
or is equal to 85% of the greater of the two appraised values (the "HIGH
VALUE"), the fair market value will be the average of the two appraisals. If the
Low Value is less than 85% of the High Value, the two appraisers will themselves
appoint a third appraiser within 10 days after the two appraisals have been
rendered. Such third appraiser will have 20 days in which to determine
independently the fair market value. The fair market value in such case will be
the average of the two values which are closest to each other.
(iii) The expenses of the appraisal process will be shared
equally by the Indemnifying Shareholder(s) and the Parent.
8.09. EXCEPTIONS TO LIMITATIONS. The representations and warranties of
the Company Parties set forth in Sections 3.05 (Ownership and Control), 3.10
(Tax Matters) or 3.19(d) (Accounts Receivable), any intentional
misrepresentations that were made by the Company Parties, and any claims arising
under Section 8.01 relating to the representations and warranties set forth in
Sections 3.05, 3.10 and 3.19(d), shall not (i) be subject to any of the
limitations on survival set forth in Section 8.05, (ii) be subject to the
indemnification threshold set forth in Section 8.07, and (iii) count against the
indemnification cap set forth in Section 8.08.
ARTICLE IX
COVENANTS OF PARENT AND SUB
---------------------------
Notwithstanding the agreement between the parties with respect to
Section 8.01(e), Parent and Sub acknowledge that as part of the Merger and by
operation of law Sub will be directly responsible to all third parties for
contractual obligations entered into by the Company prior to the Closing Date
and Sub agrees to continue to honor such contractual obligations in the ordinary
course of its business.
ARTICLE X
MISCELLANEOUS PROVISIONS
------------------------
10.01. AMENDMENTS. This Agreement may be amended only by a writing
signed by each of the parties, and any such amendment shall be effective only to
the extent specifically set forth in such writing.
10.02. ASSIGNMENT. Neither this Agreement nor any right, interest or
obligation hereunder may be assigned, pledged or otherwise transferred by any
party, whether by operation of law or otherwise, without the prior consent of
the other party or parties.
10.03. CONFIDENTIALITY.
(a) As used in this Section the "CONFIDENTIAL INFORMATION" of a
party shall mean all information concerning or related to the business,
operations, financial condition or prospects of such party or any of its
Affiliates, regardless of the form in which such information appears and whether
or not such information has been reduced to a tangible form, and shall
specifically include (i) all information regarding the officers, directors,
employees, equity holders, customers, suppliers, distributors, sales
representatives and licensees of such party and its Affiliates, in each case
whether present or prospective, (ii) all inventions, discoveries, trade secrets,
processes, techniques, methods, formulae, ideas and know-how of such party and
its Affiliates and (iii) all financial statements, audit reports, budgets and
business plans or forecasts of such party and its Affiliates; provided, that the
Confidential Information of a party shall not include (A) information which is
or becomes generally known to the public through no act or omission of the other
party and (B) information which has been or hereafter is lawfully obtained by
the other party from a source other than the party to whom such Confidential
Information belongs (or any of its Affiliates or their respective officers,
directors, employees, equity holders or agents) so long as, in the case of
information obtained from a third party, such third party was or is not,
directly or indirectly, subject to an obligation of confidentiality owed to the
party to whom such Confidential Information belongs or any of its Affiliates at
the time such Confidential Information was or is disclosed to the other party.
(b) Except as otherwise permitted by subsection (c) below, each
party agrees that it will not, without the prior written consent of the other
party, disclose or use for its own benefit any Confidential Information of the
other party.
(c) Notwithstanding subsection (b) above, each of the parties
shall be permitted to:
(i) disclose Confidential Information of the other party to
its officers, directors, employees, equity holders, lenders, agents and
Affiliates, but only to the extent reasonably necessary in order for such party
to perform its obligations and exercise its rights and remedies under this
Agreement, and such party shall take all such action as shall be necessary or
desirable in order to ensure that each of such Persons maintains the
confidentiality of any Confidential Information that is so disclosed;
(ii) make additional disclosures of or use for its own
benefit Confidential Information of the other party, but only if and to the
extent that such disclosures or use are specifically contemplated by this
Agreement; and
(iii) disclose Confidential Information of the other party to
the extent, but only to the extent, required by Governmental Rules; provided,
that prior to making any disclosure pursuant to this subparagraph, the party
required to make such disclosure (the "DISCLOSING PARTY") shall notify the other
party (the "AFFECTED PARTY") of the same, and the Affected Party shall have the
right to participate with the Disclosing Party in determining the amount and
type of Confidential Information of the Affected Party, if any, which must be
disclosed in order to comply with Governmental Rules.
(d) If the Closing does not occur, then each party may demand the
return from the other party of its Confidential Information, whereupon the other
party shall promptly return all such Confidential Information which is in its
possession or in the possession of its officers, directors, employees, equity
holders, lenders, agents or Affiliates.
10.04. COUNTERPARTS; TELEFACSIMILE EXECUTION. This Agreement may be
executed in any number of counterparts, and by each of the parties on separate
counterparts, each of which, when so executed, shall be deemed an original, but
all of which shall constitute but one and the same instrument. Delivery of an
executed counterpart of this Agreement by telefacsimile shall be equally as
effective as delivery of a manually executed counterpart of this Agreement. Any
party delivering an executed counterpart of this Agreement by telefacsimile also
shall deliver a manually executed counterpart of this Agreement, but the failure
to deliver a manually executed counterpart shall not affect the validity,
enforceability or binding effect of this Agreement.
10.05. ENTIRE AGREEMENT. This Agreement contains the entire agreement
of the parties with respect to the transactions contemplated hereby and
supersedes all prior written and oral agreements, and all contemporaneous oral
agreements, relating to such transactions.
10.06. EXPENSES. Except as otherwise specifically provided herein or in
any other Transaction Document, each party shall be responsible for such
expenses as it may incur in connection with the negotiation, preparation,
execution, delivery, performance and enforcement of this Agreement and the other
Transaction Documents. If the Closing occurs, Shareholders shall pay all
expenses of Company (or reimburse Company for all such expenses incurred prior
to the Effective Date) in connection with the transactions contemplated hereby
and the negotiation, preparation, execution, delivery, performance and
enforcement of this Agreement and the other Transaction Documents.
10.07. FURTHER ASSURANCES. The parties shall from time to time do and
perform such additional acts and execute and deliver such additional documents
and instruments as may be required by applicable Governmental Rules or
reasonably requested by any party to establish, maintain or protect its rights
and remedies or to effect the intents and purposes of this Agreement and the
other Transaction Documents. With limiting the generality of the foregoing, each
party agrees to endorse (if necessary) and deliver to the other, promptly after
its receipt thereof, any payment or document which it receives after the Closing
Date and which is the property of the other.
10.08. GOVERNING LAW. This Agreement shall be a contract under the laws
of the State of Delaware and for all purposes shall be governed by and construed
and enforced in accordance with the laws of said State, without giving effect to
the principles of conflicts of law thereof or of any other jurisdiction.
10.09. NOTICES. Unless otherwise specifically provided herein, all
notices, consents, requests, demands and other communications required or
permitted hereunder:
(a) shall be in writing;
(b) shall be sent by messenger, certified or registered U.S.
mail, a reliable express delivery service or telecopier (with a copy sent by one
of the foregoing means), charges prepaid as applicable, to the appropriate
address(es) or number(s) set forth below; and
(c) shall be deemed to have been given on the date of receipt by
the addressee (or, if the date of receipt is not a business day, on the first
business day after the date of receipt), as evidenced by (i) a receipt executed
by the addressee (or a responsible person in his or her office), the records of
the Person delivering such
communication or a notice to the effect that such addressee refused to claim or
accept such communication, if sent by messenger, U.S. mail or express delivery
service, or (ii) a receipt generated by the sender's telecopier showing that
such communication was sent to the appropriate number on a specified date, if
sent by telecopier.
All such communications shall be sent to the following addresses or numbers, or
to such other addresses or numbers as any party may inform the others by giving
five business days' prior notice:
If to Company or Shareholders: With a copy to:
Xxxxx and Xxxxxxxx Xxxxxxx Xxxx, Forward, Xxxxxxxx & Scripps LLP
6190 Corte Del Cedro 000 Xxxx Xxxxxxxx, Xxxxx 0000
Xxxxxxxx, Xxxxxxxxxx 00000 Xxx Xxxxx, Xxxxxxxxxx 00000
Telecopier No.: 760.929.1811 Attn: Xxxxxx X. Xxxxxxxx, Esq.
Telecopier No.: 619.645.5332
If to Sub or Parent: With a copy to:
NOMOS Corporation Xxxxx & Xxxxxxx, P.C.
0000 Xxxxxxx-Xxxxx Xxxx, Xxxxx 000 00 Xxxxxxx Xxxxxx, 00xx Xxxxx
Xxxxxxxxx, Xxxxxxxxxxxx 00000 Xxxxxxxxxx, Xxxxxxxxxxxx 00000-0000
Attn: Xxxx Xxxxxxx, President Attn: Xxxx X. Baseman, Esq.
Telecopier No.: 724.934.5488 Telecopier No.: 412.209.0672
10.10. PUBLICITY. Prior to the Closing Date, neither party shall make
any press release or other public announcement regarding this Agreement or the
other Transaction Documents or any transaction contemplated hereby or thereby
until the text of such release or announcement has been submitted to the other
party and the other party has approved the same.
10.11. SEVERABILITY. Any provision of this Agreement which is
prohibited or unenforceable in any jurisdiction shall, as to such jurisdiction,
be ineffective to the extent of such prohibition or unenforceability without
invalidating the remaining portions hereof or affecting the validity or
enforceability of such provision in any other jurisdiction.
10.12. SUCCESSORS AND ASSIGNS. This Agreement shall be binding upon and
shall inure to the benefit of each of the parties and their respective heirs,
successors and permitted assigns.
10.13. TERMINATION.
(a) This Agreement may be terminated at any time prior to the
Closing:
(i) by mutual agreement of Sub, Parent and Company;
(ii) by Sub or Parent if there has been a material
misrepresentation by Company hereunder, a material breach by Company of any of
its warranties or covenants set forth herein or if any of the conditions
specified in Section 7.01 shall not have been fulfilled within the time required
and shall not have been waived by Sub or Parent;
(iii) by Company if there has been a material
misrepresentation by Sub or Parent hereunder, a material breach by Sub of Parent
of any of their respective warranties or covenants set forth herein or if any of
the conditions specified in Section 7.02 shall not have been fulfilled within
the time required and shall not have been waived by Company; or
(iv) by Parent, Sub or Company if the Closing shall not have
occurred prior to January 27, 1999; provided, that Parent, Sub or Company may
terminate this Agreement pursuant to this subparagraph only if the Closing shall
not have occurred on or prior to such date for a reason other than a failure by
such party to satisfy the conditions to Closing of the other party set forth in
Section 7.01 or 7.02.
(b) If this Agreement is terminated by either Company, Parent or
Sub as provided above, then no party shall have any further obligations or
liabilities hereunder except for obligations or liabilities arising from a
breach of this Agreement prior to such termination or which survive such
termination by their own terms.
10.14. WAIVERS. The due performance or observance by the parties of
their respective obligations hereunder and under the other Transaction Documents
shall not be waived, and the rights and remedies of the parties hereunder and
under the other Transaction Documents shall not be affected, by any course of
dealing or performance or by any delay or failure of any party in exercising any
such right or remedy. The due performance or observance by a party of any of its
obligations hereunder or under any other Transaction Document may be waived only
by a writing signed by the party against whom enforcement of such waiver is
sought, and any such waiver shall be effective only to the extent specifically
set forth in such writing.
10.15. KNOWLEDGE PARTIES. References in this Agreement to the knowledge
of Company, Company Parties, Sub or Parent, or words of a similar import, shall
mean the collective knowledge of (a) in the case of Company or Company Parties,
Xxxxx Xxxxxxx and Xxxxxxxx Xxxxxxx, and (b) in the case of Parent or Sub, Xxxx
Xxxxxx and Xxxx Xxxxxxx,
in each case assuming reasonable investigation and inquiry as to subject matter
in question made of such party's other officers, directors and management
employees and of such party's outside accountants and legal advisors.
RADIATION ONCOLOGY COMPUTER SYSTEMS, INC.
By: /s/ Xxxxx X. Xxxxxxx
--------------------------
Title: Pres.
-----------------------
SHAREHOLDERS:
/s/ Xxxxx X. Xxxxxxx
------------------------------
Xxxxx Xxxxxxx
/s/ Xxxxxxxx X. Xxxxxxx
------------------------------
Xxxxxxxx Xxxxxxx
NOMOS CORPORATION
By: /s/ Xxxx X. Xxxxxxx
--------------------------
Xxxx X. Xxxxxxx, President
ROCS ACQUISITION, INC.
By: /s/ Xxxx X. Xxxxxxx
--------------------------
Xxxx X. Xxxxxxx, President
INDEX OF DEFINED TERMS
The following terms are defined in the Agreement on the following page:
Definition Page
---------- ----
Affected Party...............................................................40
Affiliate....................................................................19
Agreement of Merger...........................................................1
Annual Period.................................................................3
Certificate of Merger.........................................................1
CGCL..........................................................................1
Xxxxxxxx Xxxxxxx Employment Agreement........................................29
Closing.......................................................................1
Closing Date..................................................................2
Code.........................................................................14
Company.......................................................................1
Company Business Agreements..................................................18
Company Business Permits.....................................................10
Company Common Stock..........................................................2
Company Current Financial Statements..........................................7
Company ERISA Affiliate......................................................15
Company Financial Statement Date..............................................7
Company Financial Statements..................................................7
Company Indemnitee...........................................................34
Company Intellectual Property................................................13
Company Material Adverse Change...............................................5
Company Parties...............................................................5
Company Pension Plan.........................................................15
Company Welfare Plan.........................................................16
Competing Business...........................................................33
Confidential Information.....................................................39
control......................................................................19
Xxxxx Xxxxxxx Employment Agreement...........................................29
DGCL..........................................................................1
Disclosing Party.............................................................40
Earn-Out Fee..................................................................3
Earn-Out Period...............................................................3
Earn-Out Reports..............................................................4
Effective Time................................................................1
Environmental Rule...........................................................11
Equipment....................................................................12
ERISA........................................................................15
Escrow Agent..................................................................3
Escrow Agreement..............................................................3
Escrow Fund...................................................................3
GAAP..........................................................................7
Governmental Order............................................................6
Governmental Rule.............................................................6
Gross Revenues................................................................3
Hazardous Substance..........................................................12
High Value...................................................................38
Indemnification Cap..........................................................37
Indemnification Date.........................................................37
Indemnifying Shareholder(s)..................................................38
Indemnitee...................................................................35
Indemnitor...................................................................35
IRS...........................................................................8
Landlord.....................................................................30
Lease........................................................................30
Lease Amendment..............................................................30
Liens........................................................................14
Low Value....................................................................38
Management Systems........................................................20,25
Merger........................................................................1
Merger Consideration..........................................................3
Multiemployer Plan...........................................................16
Parent........................................................................1
Parent Common Stock..........................................................22
Parent Current Financial Statements..........................................22
Parent Financial Statement Date..............................................23
Parent Financial Statements..................................................22
Parent Group..................................................................3
Parent Indemnitee............................................................34
Parent Material Adverse Change...............................................21
PBGC.........................................................................14
Person........................................................................6
Proceeding...................................................................35
Production Systems........................................................20,25
Products.....................................................................33
Release......................................................................29
ROCS Acquisition, Inc.........................................................1
ROCS Products.................................................................3
Shareholder Certificates.....................................................30
Shareholders..................................................................1
Sub...........................................................................1
Sub Common Stock..............................................................3
Surviving Corporation.........................................................1
Systems...................................................................19,24
Territory....................................................................33
Threshold Amount.............................................................37
Transaction Documents........................................................29
Year 2000 Compliant.......................................................20,24
LIST OF SCHEDULES AND EXHIBITS
EXHIBITS
--------
Exhibit 2.01 Escrow Agreement
Exhibit 2.02A List of ROCS Products
Exhibit 2.02B Earn-Out Example
Exhibit 2.02C Package Pricing Example
Exhibit 6.01(h) Form of Opinion of Company's Counsel
Exhibit 6.02(h) Form of Opinion of Counsel of Parent and Sub
Exhibit 6.01(i)(vi) Form of Shareholder Certificate
COMPANY SCHEDULES
-----------------
Schedule 3.01 Organization and Qualification
Schedule 3.05 Ownership and Control
Schedule 3.06 Subsidiaries
Schedule 3.07 Financial Statements
Schedule 3.09 Bank Accounts
Schedule 3.10 Tax Matters
Schedule 3.11 Litigation
Schedule 3.12 Absence of Certain Changes and Events
Schedule 3.13 Customers and Suppliers
Schedule 3.15 Governmental Orders
Schedule 3.16 Company Business Permits
Schedule 3.17 Environmental Matters
Schedule 3.18 Company Real Property
Schedule 3.19 Company Personal Property
Schedule 3.20 Company Intellectual Property
Schedule 3.21 Title to Company Assets
Schedule 3.22 Company Pension Plans
Schedule 3.23 Company Welfare Plans
Schedule 3.24 Company Personnel Matters
Schedule 3.25 Company Insurance
Schedule 3.26 Company Indebtedness
Schedule 3.27 Other Material Company Business Agreements
Schedule 3.28 Company Business Agreements that Require Consent
Schedule 3.29 Warranty and Product Liability
Schedule 3.30 Transactions with Company Affiliates
Schedule 3.32 Year 2000
PARENT AND SUB SCHEDULES
------------------------
Schedule 4.01 Organization and Qualification of Parent and Sub
Schedule 4.05 Ownership and Control of Parent and Sub
Schedule 4.06 Subsidiaries of Parent and Sub
Schedule 4.07 Financial Statements of Parent and Sub
Schedule 4.08 Litigation of Parent and Sub
Schedule 4.09 Absence of Certain Changes and Events
Schedule 4.11 Environmental Matters
Schedule 4.13 Year 2000
