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EXHIBIT 10.6
ASSET PURCHASE AGREEMENT
ASSET PURCHASE AGREEMENT dated as of March ______, 1996 by and between
LINTEL SECURITY SA/NV, a corporation existing under the laws of Belgium on one
hand ("Buyer") and LINTEL SA/NV, a corporation existing under the laws of
Belgium ("Seller"), XXXXX XXXXXXXXX ("Xxxxx") and XXX XXXXXX ("Guy" and Mario
being hereinafter collectively referred to as the "Shareholders"), on the other
hand.
W I T N E S S E T H:
WHEREAS, Seller is, among other things, engaged under the name of Lintel
Security in the business of the manufacture and sale of computer security
products and other security type products (the "Business"); and
WHEREAS, Mario and Guy own all of the equity interests in Seller; and
WHEREAS, Buyer wishes to purchase from Seller and Seller wishes to sell to
Buyer substantially all of the assets (both tangible and intangible) of Seller
used in connection with the Business.
NOW, THEREFORE, in consideration of the premises and the mutual agreements
hereinafter set forth, the parties hereto hereby agree as follows:
ARTICLE I
PURCHASE AND SALE OF ASSETS
1.01 Purchase of Assets. On the terms and subject to the conditions set
forth herein, at the "Closing" (as defined in Section 2.01) Buyer shall
purchase from Seller, and Seller shall sell, assign, transfer, convey and
deliver to Buyer, all of Seller's right, title and interest in and to all of
the assets and properties owned or used by Seller in the Business including
those assets described in Section 1.02 hereof, except for the Excluded Assets
(as defined below); all of such assets and properties being hereinafter
collectively referred to as the "Purchased Assets."
1.02 Purchased Assets. The Purchased Assets shall include, without
limitation, all of Seller's right, title and interest in and to all of the
following assets whether tangible or intangible:
(a) inventory;
(b) furniture, fixtures and equipment;
(c) Rights (as defined in Section 5.10 hereof);
(d) contracts to supply products to unaffiliated third parties; and
(e) goodwill.
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1.03 Excluded Assets. The Purchased Assets shall not include:
(a) the minute books of Seller;
(b) the tax returns of Seller; and
(c) accounts receivable.
The foregoing are collectively referred to herein as the "Excluded Assets."
1.04 Seller's Accounting Records. At all times after the Closing Date,
Seller shall retain and make available to Buyer the original accounting and tax
records and tax returns pertaining to Seller, and, to the extent necessary to
enable Buyer to carry on the Business, shall permit Buyer to make copies
thereof.
1.05 Instruments of Transfer. Seller shall deliver to Buyer at Closing
such bills of sale, title documents and assignments and consents (where
required) in form and substance satisfactory to Buyer and its counsel
sufficient to vest in Buyer good and valid title to all of Seller's right,
title and interest in and to the Purchased Assets free and clear of all
mortgages, claims, liens, charges or encumbrances of any kind or nature
whatsoever.
ARTICLE II
CLOSING
2.01 Closing. The Closing of the transactions contemplated hereby (the
"Closing") shall take place at the offices of Roberti, Martin, Weinberger,
Cools, Migeal & Xxxxxx, no later than five (5) business days after the
incorporation of New Lintel, or at such other place or time as shall be
mutually agreed on by the parties hereto (such time on such date or such other
agreed upon time and date is called the "Closing Date").
ARTICLE III
CONSIDERATION
3.01 Purchase Price. The purchase price to be paid by Buyer for and in
consideration of the sale, assignment, transfer, conveyance and delivery of the
Purchased Assets and shall be equal to (I) the fair value of the Purchased
Assets, other than the inventory, which shall be determined in good faith (the
"Transferred Consideration"), plus (ii) the value of the inventory included in
the Purchased Assets (the "Inventory") which value shall be equal to the
Seller's cost of such Inventory (the "Inventory Consideration"), plus (iii) the
liabilities assumed by Buyer, as determined in accordance with Section 4.01
hereof (the "Purchase Price").
3.02 Payment of Purchase Price. In consideration of, and as full payment
for the sale, assignment, transfer, conveyance and delivery of the Purchased
Assets and for the Covenants Not to Compete, at the Closing, Buyer shall (a)
pay the Transferred
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Consideration to Seller by delivery to Seller of (i) a check, (b) agree to pay
the Inventory Consideration in accordance with the commercial terms upon which
Seller purchased the Inventory, and (c) assume and agree to pay, perform and
discharge the Assumed Obligations (as defined below).
ARTICLE IV
ASSUMED OBLIGATIONS
4.01 Assumption. At the Closing, Buyer shall assume and agree to pay,
perform and discharge the obligations of Seller (the "Assumed Obligations")
arising from and after the Closing Date pursuant to those contracts of Seller
being transferred to Buyer and specifically identified as an "Assumed Contract"
on Schedule 5.14 hereof (the "Assumed Contracts"). Any other provision of this
Agreement to the contrary notwithstanding, Buyer shall not and does not assume
any liability or obligation of Seller whether or not disclosed in this
Agreement other than as is set forth in this Section 4.01.
ARTICLE V
REPRESENTATIONS AND WARRANTIES OF SELLER
The Shareholders and the Seller hereby jointly and severally represent and
warrant to and agree with Buyer as follows:
5.01 Organization and Good Standing. Seller is a corporation duly
organized, validly existing and in good standing under the laws of Belgium.
Seller has full corporate power and authority to conduct the Business.
5.02 Authority and Compliance. Seller has full corporate power and
authority to execute and deliver this Agreement and any and all documents in
connection herewith. The consummation and performance by Seller of the
transactions contemplated by this Agreement have been duly and validly
authorized by all necessary corporate and other proceedings. This Agreement
has been duly and validly executed and delivered by the Seller and the
Shareholders and constitutes a valid obligation of each of them, enforceable
against each of them in accordance with its terms. No consent, authorization
or approval of, exemption by, or filing with, any domestic governmental or
administrative authority, or any court, or any third party is required to be
obtained or made by Seller or the Shareholders in connection with the
execution, delivery and performance of this Agreement or the consummation of
the transactions contemplated hereby.
5.03 No Conflict. The performance of this Agreement and the consummation
of the transactions contemplated hereby will not result in a breach or
violation of any of the terms or provisions of, or constitute a default under,
(i) the articles of incorporation or by-laws or similar governing documents of
Seller, (ii) any contract or other agreement or instrument to which Seller
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is a party or by which it is bound, or (iii) any law, order, rule, regulation,
writ, injunction or decree applicable to Seller.
5.04 Compliance with Law. Seller and its use of the Purchased Assets and
its conduct of the Business are in compliance in all material respects with
all, and not in violation in any material respect of any applicable law or
ordinance, or any order, rule or regulation of any governmental agency or body
to which Seller or the Purchased Assets are subject; nor has Seller failed to
obtain or to adhere in all material respects to the requirements of any
government license, permit or authorization necessary to the ownership of the
Purchased Assets or to the conduct of the Business. All governmental permits,
licenses and authorizations required by Seller in the conduct of the Business
are set forth in Schedule 5.04.
5.05 Financial Statements.
Schedule 5.05 contains copies of the financial statements of the Business
for the year ended December 31, 1995 (the "Financial Statements"). The
Financial Statements are true and correct and present fairly, in all material
respects, the financial position of the Business as of December 31, 1995 and
the results of its operations and its cash flows for the year then ended in
conformity with generally accepted accounting principles, consistently applied.
5.06 Title to Assets. At the Closing, Seller will convey to Buyer good
and valid marketable title to all of the Purchased Assets, free and clear of
all liens, pledges, mortgages, security interests, licenses, and other
encumbrances of any kind or nature whatsoever.
5.07 Condition of Assets. All tangible assets and properties included in
the Purchased Assets are as of the date hereof and on the Closing Date will be
in good operating condition and repair in all material respects (normal wear
and tear excepted) and are usable in the ordinary course of the Business as
previously conducted.
5.08 Inventory; Products. All inventory reflected on the Financial
Statements and all inventory relating to the Business acquired by the Seller
subsequent to December 31, 1995 to and including the Closing Date was and will
be of a quality and quantity usable or salable in the ordinary course of
business. The values of the inventory carried on the Financial Statements are
at the lower of cost or market of such inventory in accordance with generally
accepted accounting principles.
5.09 Absence of Certain Events. Except as set forth on Schedule 5.09,
since December 31, 1995 Seller has not:
(a) sold, assigned or transferred any of its assets or properties
necessary for the operation of the Business, except in the ordinary course of
business consistent with past practice;
(b) made any amendment or termination of any material contract,
commitment or agreement relating to the Business to which it is a party or by
which it is bound;
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(c) suffered any material adverse change or received verbal or written
notice of a material adverse change in their business relations with any of the
major suppliers or customers of the Business which would, individually or in
the aggregate, have a material adverse effect on the conduct of the Business;
(d) with respect to the employees of the Business, received notice
or had knowledge of any strike or disruption of work of a concerted nature or
any threat thereof; or
(e) lost the services of any key employee of the Business or received
notification of the threatened or imminent loss of any such employee.
5.10 Patents, Trademarks, Copyrights, etc. Except as set forth on
Schedule 5.10, there are no patents, patent rights, patent applications,
licenses, shop rights, trademarks, trademark applications, trade names,
copyrights, computer software and similar rights (collectively "Rights")
currently owned or used in the conduct of the Business. The Purchased Assets
include all Rights and other proprietary information necessary to the conduct
of the Business as currently being conducted. No patents, formulae, know-how,
secrets, trademarks, trademark registrations, logos, trade names, assumed
names, copyrights or computer software used in the Business infringe on any
patents, trademarks, or copyrights, or any other rights of any person. Seller
has taken all reasonable measures to maintain and protect, the patents,
trademarks, trademark registrations, logos, trade names, assumed names,
copyrights and copyright registrations listed on Schedule 5.10. Seller has not
received notice of any claims which have been asserted by any person to the use
of any such patents, trademarks, trademark registrations, logos, trade names,
assumed names, copyrights and copyright registrations or challenging or
questioning the validity or effectiveness of any such license or agreement.
5.11 Legal Proceedings, Etc. There are no claims, actions, suits,
proceedings, arbitrations or investigations, either administrative or judicial,
pending or, to the best knowledge of Seller, threatened by, or against Seller,
which could harm the Buyer.
5.12 Labor Disputes. There are no strikes or disruptions of work
involving the employees of the Business of a concerted nature. Seller is not a
party to any collective bargaining agreement with any union or other
representative of employees.
5.13 Customers; Suppliers; Adverse Conditions. Since January 1, 1995,
there has not been any termination or cancellation, nor has Seller received
verbal or written notice of any threatened termination or cancellation of the
business relationship of the Seller with (a) any of the customers of the
Business, or (b) any of the major suppliers (with the exception of CSP) of the
Business which would, either individually or in the aggregate have a material
adverse effect on the Business.
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5.14 Contracts and Commitments.
Except as listed and described on Schedule 5.14, Seller is not a party to
any:
(i) Contract (as defined below) with any present or former
shareholder, director, officer, employee or consultant (including, without
limitation, any employment agreement);
(ii) Contract for the future purchase of, or payment for, supplies or
products involving payment of in excess of $50,000 or for the performance of
services by a third party involving payment in excess of $25,000;
(iii) Contract to sell or supply products or to perform services
involving receipt by the Seller of in excess of $50,000;
(iv) Representative, sales agency or distribution agreement, contract
or commitment;
(v) Contract or Contracts for the borrowing of money for a line of
credit, or for a guarantee, pledge or undertaking of the indebtedness of any
other person;
(vi) Contract with respect to any Rights;
(vii) Contract limiting or restraining in any respect Seller from
engaging or competing in any lines of business or with any person; or
(xiii) any other Contract material to the operation of the Business.
As used in the Agreement, the term "Contract" includes any mortgage, indenture,
agreement, contract, commitment or lease,
5.15 Employee Benefit Plans.
(a) Set forth on Schedule 5.15 is a summary of any bonus, incentive,
deferred compensation, profit sharing, pension, retirement, disability,
hospitalization, life insurance, health benefit, medical reimbursement,
vacation, sick pay, severance pay or other plan or agreement or consideration
above legal requirements, providing benefits to any of the employees of Seller
("Employee Plans").
(b) Set forth on Schedule 5.15 is the total amount of cumulative fringe
benefits to which employees have accrued entitlement as of December 31, 1995.
All amounts required by the provisions of any Employee Plan and applicable law
to be contributed to any Employee Plan have been, or will be, contributed to
such Employee Plan through the Closing Date.
(c) The Seller has provided Buyer with true and correct copies of all
Employee Plans.
5.16 Employees. Schedule 5.16 hereof sets forth the name of each employee
of Seller who performs services related to the Business and the job description
and rate of compensation of each such employee as of the date hereof.
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ARTICLE VI
COVENANTS
6.01 Confidential Information. Each of Mario and Guy agrees with Buyer
for himself only that he shall keep secret and retain in strictest confidence,
and shall not use for the benefit of himself or others, all confidential
matters relating to the Business.
6.02 Post Closing Employment. Subject to the Closing having occurred,
Buyer shall offer employment to only those employees of Seller listed on
Schedule 6.02 (the "Acquired Employees") and shall make available to each
Acquired Employee such salary and benefits as are currently provided to such
Acquired Employee by Seller.
6.03 Purchase Contract. Annexed hereto as Schedule 6.03 is a true and
correct copy of an agreement between Seller and ActivCard with respect to the
obligation of ActivCard to supply Seller with AuthentiCard tokens (the "AC
Tokens"). Seller agrees for a period of two years from and after the Closing
Date to purchase such number of AC Tokens from ActivCard and to resell such AC
Tokens to Buyer as may be necessary for Buyer to supply AC Tokens to Buyer's
customers. Seller shall sell such AC Tokens to Buyer at Seller's cost therefor
plus 5%.
ARTICLE VII
CONDITIONS PRECEDENT TO THE OBLIGATIONS OF BUYER
The obligations of Buyer pursuant to this Agreement are subject to the
satisfaction at the Closing of each of the following conditions, any one or
more of which may be waived by Buyer.
7.01 Accuracy of Representation and Warranties. The representations and
warranties of Seller and the Shareholders contained in this Agreement shall be
true on and as of the Closing Date with the same force and effect as through
made on and as of the Closing Date, except as effected by transactions
contemplated hereby.
7.02 Performance of Agreement. Seller and the Shareholders shall have
performed and complied with all covenants, obligations and agreements to be
performed or complied with by them on or before the Closing Date pursuant to
this Agreement.
7.03 Officer's Certificate. Buyer shall have received a certificate of
the chief executive officer of Seller, dated the Closing Date, certifying as to
the fulfillment of the conditions set forth in Sections 7.01 and 7.02 hereof.
7.04 Actions, Proceedings, etc. All actions, proceedings, instruments
and documents required to carry out the transactions contemplated by this
Agreement and all other related legal matters shall be reasonably satisfactory
to Buyer and its counsel; and Buyer shall have been furnished with such other
instruments and documents as it shall have reasonably requested.
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7.05 Consent to Assignment. Seller shall have obtained and delivered to
Buyer the Assumed Contract Consents.
7.06 Employment Agreement. Mario shall execute and deliver to Buyer an
agreement relating to his providing services to Buyer during the Time Period as
managing Director of Buyer in the form annexed hereto as Exhibit A (the
"Employment Agreement").
7.07 Concurrent Agreement. Each of Vasco Corp., Vasco Europe, Mario and
Guy shall have executed and delivered an agreement of even date herewith which
agreement provides for, among other things, the purchase by Vasco Europe of the
equity interests of Buyer owned by Mario and Guy.
ARTICLE VIII
CONDITIONS PRECEDENT TO THE OBLIGATION OF SELLER
The obligations of Seller under this Agreement are subject to the
satisfaction at the Closing of each of the following conditions, any one or
more of which may be waived by Seller.
8.01 Accuracy of Representation and Warranties. The representations and
warranties of Buyer contained in this Agreement shall be true on and as of the
Closing Date with the same force and effect as through made on and as of the
Closing Date, except as effected by transactions contemplated hereby.
8.02 Performance of Agreement. Buyer shall have performed and complied
with all covenants, obligations and agreements to be performed or complied with
by them on or before the Closing Date pursuant to this Agreement.
8.03 Employment Agreement. The Buyer shall have executed and delivered to
Mario the Employment Agreement.
ARTICLE IX
INDEMNIFICATION
9.01 Indemnification by the Shareholders and Seller.
The Shareholders and Seller hereby jointly and severally covenant and
agree with Buyer that they shall reimburse and indemnify Buyer and its
successors and assigns and hold them harmless from, against and in respect of
any and all costs, losses, claims, liabilities, fines, penalties, damages and
expenses, including interest which may be imposed in connection therewith and
court costs and reasonable fees and disbursements of counsel (collectively
"Claims") incurred by them due to, arising out of, or in connection with, (i) a
breach of any of the representations, warranties, covenants or agreements made
by the Shareholders and/or Seller in Article V and Section 6.04 of this
Agreement, or (ii) any liability or obligation of Seller to any person or
entity, except for any of the Assumed Obligations.
9.02 Indemnification by Buyer. Buyer hereby covenants and agrees with
Seller that it shall reimburse and indemnify Seller and its successors and
assigns and hold them harmless from, against and
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in respect of any and all Claims incurred by Seller due to, arising out of, or
in connection with (a) a breach of any of the representations, warranties,
covenants or agreements made by Buyer in this Agreement, (b) any Assumed
Obligation, or (c) liabilities relating to the operation of the Business from
and after the Closing Date.
9.03 Indemnification by each of Mario and Guy. Each of Mario and Guy for
himself only hereby covenants and agrees with Seller that he shall reimburse
and indemnify Seller and its successors and assigns and hold them harmless
from, against and in respect of any and all Claims incurred by Seller due to,
arising out of, or in connection with (a) a breach of the covenants set forth
in Section 6.01 and 6.02 of this Agreement.
ARTICLE X
GENERAL PROVISIONS
10.01 Survival of Representations, Warranties, Covenants and Agreements.
The representations, warranties and covenants contained in Articles V and VI of
this Agreement shall survive the execution of this Agreement and the closing of
the transactions contemplated hereby.
10.02 Expenses. Whether or not the transactions contemplated by this
Agreement are consummated, all costs and expenses incurred in connection with
this Agreement and the transactions contemplated hereby shall be paid by the
party incurring such expense.
10.03 Notices. Any notice, request, instruction or other document to be
given hereunder by any party to any of the other parties shall be in writing
and shall be deemed to have been duly given when delivered personally or seven
(7) days after dispatch by an overnight delivery service, such as Federal
Express, DHL, etc. to the party to whom the same is so given or made:
If to Buyer: x/x Xxxxx Corp.
0000 X. Xxxxxxxx Xxxxxx, Xxxxx 000-X
Xxxxxxx, Xxxxxxxx 00000
Attn: Mr. T. Xxxxxxx Xxxx, CFO
with a copy to: Morse, Zelnick, Rose & Lander, LLP
000 Xxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attn: Xxxxxx Xxxxxx, Esq.
If to Seller, Mario or Guy: x/x Xxxxxx Xxxxxx, Xxx.
Xxxxxxx & Associes
Xxxxxxxxx Xx. Xxxxxx 00
X-0000 Xxxxxxxx, Xxxxxxx
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with a copy to: Xxxxxx Xxxxxx
Xxxxxxx & Associes
Xxxxxxxxx Xx. Xxxxxx 00
X-0000 Xxxxxxxx, Xxxxxxx
The above addresses may be modified by providing written notice to the other
parties.
10.04 Assignability and Amendments. This Agreement shall not be
assignable by any of the parties. This Agreement cannot be altered or otherwise
amended except pursuant to an instrument in writing signed by each of the
parties.
10.05 Entire Agreement. This Agreement and the Exhibits and Schedules
which are a part hereof and the other writings and agreements specifically
identified herein contain the entire agreement between the parties with respect
to the transactions contemplated herein and supersede all previous written or
oral negotiations, commitments and understandings.
10.06 Waivers, Remedies. Any waiver hereunder must be in writing and
signed by the party to be bound thereby. A waiver of any of the terms or
conditions of this Agreement shall not in any way affect, limit or waive a
party's rights under any other term or condition of this Agreement. All
remedies under this Agreement shall be cumulative and not alternative.
10.07 Counterparts and Headings. This Agreement may be executed in two or
more counterparts, each of which shall be deemed an original and all of which
together shall constitute one and the same instrument. All headings are
inserted for convenience of reference only and shall not affect the meaning or
interpretation of this Agreement.
10.08 Severability. If and to the extent that any court of competent
jurisdiction holds any provision (or any part thereof) of this Agreement to be
invalid or unenforceable, such holding shall in no way affect the validity of
the remainder of this Agreement.
10.09 Binding Effects. This Agreement shall be binding upon and inure to
the benefit of the parties hereto, their successors, legal representatives and
assigns.
10.10 Governing Law. This Agreement shall be governed by the laws of
Belgium. The sole jurisdiction of any claims made under this Agreement shall
be set in the Commercial Court of Brussels, Belgium and as between French and
Dutch the parties hereby elect that any disputes be heard solely in French.
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IN WITNESS WHEREOF, the Parties hereto have duly executed this Agreement
as of the day and year first above written,
LINTEL SECURITY SA/NV
By : /s/ T. Xxxxxxx Xxxx
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LINTEL SA/NV
By: /s/ Xxxxx Xxxxxxxxx
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/s/ Xxxxx Xxxxxxxxx
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XXXXX XXXXXXXXX
/s/ Xxx Xxxxxx
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XXX XXXXXX
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