Exhibit 10.15
S/325226DeedSydney
OBJECTIVE SYSTEMS INTEGRATORS PTY LIMITED
OPEN TECHNOLOGY PTY LIMITED
BUSINESS SALE AGREEMENT
CORRS XXXXXXXX WESTGARTH
Solicitors
Xxxxx 00
Xxxxxxxx Xxxxxxx Tower
0 Xxxxxx Xxxxx
XXXXXX XXX 0000
XXXXXXXXX
Tel: (00) 0000 0000
Fax: (00) 0000 0000
DX: 000 Xxxxxx
Ref: XXX/XXX
XXXX0000-000
325226
CONTENTS
RECITALS
OPERATIVE PROVISIONS
1 INTERPRETATION
1.1 Definitions
1.2 Construction
1.3 Headings
2 SALE AND PURCHASE OF THE BUSINESS
2.1 Sale and purchase of the Business
2.2 Purchase Price
2.3 Time and manner of payment
2.4 Investment of the Escrow Amount
2.5 Release of the Escrow Amount
2.6 Conversion to Australian Dollars after Completion
3 CONDITIONS PRECEDENT TO COMPLETION
3.1 Conditions to be satisfied by OT
3.2 Fulfilment of conditions
3.3 Termination Date
4 COMPLETION
4.1 Time and place of Completion
4.2 Delivery by OSI
4.3 Delivery by OT
4.4 Further actions by OT
4.5 Passing of title
4.6 Passing of risk
4.7 Interdependence of obligations
4.8 Risk Assumption Date
5 EMPLOYEES
5.1 Termination of employment
5.2 Employees not employed by OSI
5.3 Transferring Employees
5.4 Terms of employment
5.5 OT's indemnity with respect to the Transferring Employees
5.6 OSI's indemnity with respect to the Transferring Employees
5.7 Superannuation
6 CONTINUITY OF BUSINESS
7 ASSIGNMENT OF CONTRACT
7.1 Assignment of the Specified Contract
7.2 Non-assignment of the Specified Contracts
7.3 Assumption of liabilities by OSI
8 WARRANTIES
8.1 The Warranties
8.2 The Warranties repeated
8.3 Access to facilities
8.4 Warranties survive Completion
8.5 Limitation of liability for breach of Warranties
9 WARRANTY RETENTION RESERVE CLAIM PROCEDURE
9.1 Warranty Claim Notice
9.2 Warranty Payment Amount
10 OT'S OBLIGATIONS
10.1 Accounting records
10.2 Confidentiality
10.3 Conduct of the Business and the Assets pending Completion
10.4 Litigation
10.5 Availability of information to OSI
10.6 Compliance with the Law
10.7 Statutory notices
10.8 Costs of obtaining third party consents
10.9 Correct information
10.10 Obligation to update information
11 OSI'S OBLIGATIONS
11.1 Prior to Completion
12 INDEMNITY BY XX
00 XXXXXXXXXXX
13.1 OSI's termination events
13.2 Other termination events
13.3 Termination prior to Completion
14 WARRANTY BY OSI
15 ANNOUNCEMENTS
15.1 Confidentiality
15.2 Stock Exchange
16 NOTICES
16.1 General
16.2 Method of service
16.3 Address for service
16.4 Service by post
16.5 Service by facsimile
16.6 Form received
16.7 Process service
16.8 Service after hours
17 MISCELLANEOUS
17.1 Stamp Duty
17.2 Legal Costs
17.3 Amendment
17.4 Waiver and Exercise of Rights
17.5 Rights Cumulative
17.6 Approvals and Consent
17.7 Further Assurance
17.8 Computation of Time
17.9 Governing Law and Jurisdiction
17.10 Assignment
17.11 Joint and Several Liability
17.12 Counterparts
17.13 Entire Understanding
SCHEDULE 1
1.1 Ownership of Assets
1.2 Accurate information
1.3 Litigation
1.4 Insolvency etc.
1.5 Contracts and Specified Contracts
1.6 Employees
1.7 Compliance with law/licences
1.8 Business Records
1.9 Statutory notices
1.10 Corporate power
1.11 Corporate action
1.12 Plant and equipment
1.13 Stamp duty
1.14 Effects of this agreement
1.15 Accounts
1.16 Position since Accounts Date
1.17 Liabilities and commitments
1.18 Agent
SCHEDULE 2
SCHEDULE 3
SCHEDULE 4
EXECUTION
ANNEXURE A
ANNEXURE B
ANNEXURE C
ANNEXURE D
ANNEXURE E
ANNEXURE F
ANNEXURE G
ANNEXURE H
ANNEXURE I
ANNEXURE J
ANNEXURE K
THIS Deed is made on 14 March 1997 BETWEEN OBJECTIVE SYSTEMS INTEGRATORS PTY
LIMITED ACN 077 810 596 of Xxxxx 0, 00 Xxxxx Xxxxxx, Xxxxx Xxxxxx, Xxx Xxxxx
Xxxxx ("OSI") AND OPEN TECHNOLOGY PTY LIMITED ACN 000 000 000 of 0/00 Xxxxxxxxxx
Xxxxxx, Xxxxxxxx, Xxx Xxxxx Xxxxx, Xxxxxxxxx, 0000 ("OT") RECITALS
A OT is the owner of the Assets and carries on the Business.
B OT desires to sell the Business and the Assets and OSI has agreed to
purchase the Business and the Assets on the terms of this agreement.
C To induce OSI to enter into this agreement OT has made representations
to OSI in the terms of the Warranties with the intention that OSI should rely
upon the Warranties.
OPERATIVE PROVISIONS
INTERPRETATION
Definitions
In this document:
"Accounting Standards" means:
the accounting standards as defined in the Corporations Law;
where not inconsistent with the accounting standards referred to in paragraph
(a) Australian Accounting Standards; and
where not inconsistent with the accounting standards referred to in paragraph
(a) or Australian Accounting Standards, generally accepted accounting principles
and practices in Australia consistently applied.
"Accounts" means profit and loss accounts and balance sheet of OT and includes
all statements, reports and notes attached to or intended to be read with any of
those profit and loss accounts or balance sheets, a copy of which comprises
Annexure A.
"Accounts Date" means 31 December 1996.
"Assets" means all the assets used in the Business comprising without
limitation:
the Plant and Equipment;
the Business Records; and
the Contract Benefits,
but excludes Book Debts and cash relating to the Business up to Risk Assumption
Date and OT's rights under this agreement.
"Australian Accounting Standards" means the accounting standards issued by the
Institute of Chartered Accountants in Australia and the Australian Society of
Certified Practising Accountants.
"Book Debts" means any receivable of OT referable to the conduct of the Business
sent out prior to 21 February 1997.
"Budget Schedule" means the budget schedule of expected expenses for the period
from the Risk Assumption Date up to Completion, a copy of which is annexed as
Annexure K.
"Business" means the Net Expert business of OT which involves the use of OSI's
Net Expert products and includes without limitation the Specified Contracts
including computer software importation, creation, implementation, distribution
and maintenance as well as technical consulting associated with the software and
implementation of projects forming part thereof.
"Business Day" means a day on which banks are open for general banking business
in Sydney.
"Business Handover Period" means the period of 90 days from Completion during
which OT will provide reasonable assistance to OSI to conduct the Business and
during which time OSI will provide the necessary funds to OT to conduct the
Business in accordance with clause 6.
"Business Handover Period Adjustment" means a financial adjustment between OSI
and OT at the expiry of the Business Handover Period in respect of the
assistance provided by OT to OSI in its conduct of the Business during the
Business Handover Period.
"Business Records" means, in respect of the Business only, all of OT's books of
account, customer and supplier lists, financial and business data, employee
data, technical data and all OT's other records, data, information and documents
used in the creation or calculation of such information relating to the
Business, the Assets and Employees whether recorded or stored in written form,
electronically or otherwise.
"Completion" means completion of the sale and purchase of the Business in
accordance with the terms of this agreement.
"Completion Amount" means 75% of the Purchase Price.
"Completion Date" means the date on which the sale and purchase of the Business
is completed, in accordance with clause 4.1.
"Confidential Information" means information of every kind concerning or in any
way relating to the customers, business transactions, business methods, records,
forms, charges, financial affairs, trade secrets
and knowhow of the Business other than information which is in the public domain
and excluding all the foregoing which is not related to the Business.
"Consultant" means the services of any person retained by OT in respect of the
Business at the date of this agreement otherwise than as a PAYE employee in
respect of more than 15 hours per week.
"Consulting Agreement" means a consulting agreement substantially in the form of
Annexure J.
"Contract Benefits" means all express or implied interest of OT in the Specified
Contracts.
"Corporations Law" means the Corporations Law and the Corporations Regulations
in each Australian jurisdiction and (where the context so permits) includes any
statute, ordinance, code or any prior corresponding legislation.
"Deed of Novation" means a deed of novation substantially in the terms of
Annexure E.
"Disclosure Letter" means the disclosure letter in the form of Annexure G.
"Distribution Agreement" means the distribution agreement entered into by OT and
OSI dated 16 June 1995.
"Employee Offer Letter" means a letter of offer of employment to an Employee
from OSI substantially in the form of Annexure I.
"Employee Retention Claim Event" means less than all 29of the named Employees in
Annexure D accepting bona fide offers of permanent employment or engagement by
OSI in respect of the Business on the terms set out in the Employee Offer Letter
and the Consulting Agreement.
"Employee Retention Claim Notice" means a written notice from OSI to OT and to
the Escrow Agent which makes a claim on OT in respect of an Employee Retention
Claim Event which is in accordance with the provisions of this agreement.
"Employee Retention Payment Amount" means the amount determined by multiplying
the number by which the number of Employees who accept offers of employment and
engagement from OSI (as determined by clause 5) is less than 30 29by the amount
of US$30,000 provided that where OT does not agree with an Employee Retention
Claim Notice, the number of Employees not accepting offers of employment or
engagement from OSI is the number determined by the Expert. The parties
acknowledge that the amount of US$30,000 is a genuine pre-estimate of loss that
will be suffered by OSI in the circumstances.
"Employee Retention Reserve" means 12.5% of the Purchase Price.
"Employees" means all the employees and Consultants of OT engaged in the
Business comprising the Key Employees and those listed in Part B of Annexure D.
"Encumbrance" means any mortgage, charge (whether fixed or floating) pledge,
lien (including, without limitation any unpaid vendor's lien or similar),
option, hypothecation, title retention or conditional sale agreement, lease,
hire or hire purchase agreement, option, restriction as to transfer, use or
possession, easement, subordination to any right of any other person, and any
other encumbrance or security interest.
"Escrow Agent" means the accounting firm Xxxxxxxx, Hatchman and Xxxx or such
other party agreed to in writing by the parties
"Escrow Amount" means the amount calculated in accordance with clauses 2.3(b)
and 2.3(c).
"Escrow Agreement" means an agreement to be entered into by OSI, OT and the
Escrow Agent pursuant to which the Escrow Agent will hold the Escrow Amount.
"Existing Employment Terms" means the remuneration and other allowances and
general work conditions and incentives to which all Employees are entitled.
"Expert" means the accounting firm Xxxxxxx Xxxx Xxxxxxx, or such other expert as
the parties may agree to in writing.
"Insolvency Event" means:
the bankruptcy of the person concerned; the appointment of an official manager
in respect of all or any part of the property of the person concerned;
the entry by the person concerned into a scheme of arrangement or a composition
with, or assignment for the benefit of, all or any class of its creditors, or a
moratorium involving any of them;
the person concerned being or stating that it is unable to pay its debts when
they fall due;
the appointment of a receiver, receiver and manager or provisional liquidator in
respect of the person concerned or any part of its property;
the making of a winding up order, or the passing of or attempted passing of a
resolution for winding up, in respect of the person concerned except for the
purposes of reconstruction including, without limitation, the issue of a notice
of meeting at which it is proposed to consider such resolutions;
an application being made (which is not dismissed within five Business Days) for
an order, resolution being passed or proposed, a meeting being convened or any
other action being taken to cause anything described above;
anything analogous to or of a similar effect to anything described above under
the law in any relevant jurisdiction; and
any valid attempt to enforce any Encumbrance over any of the Assets.
"Key Employees" means all the key employees of OT engaged in the Business
including those listed in Part A of Annexure D.
"Loss" means any loss (including loss of profit and loss of expected profit but
not consequential loss), claim, action, liability, damage, cost, charge,
expense, diminution in value or deficiency of any kind or character which acting
reasonably OSI pays, suffers or incurs or is liable for including, without
limitation:
all liabilities on account of Taxes;
all interest and other amounts payable to third parties; and
all legal (on a full indemnity basis) and other expenses incurred in connection
with investigating or defending any claim or action, whether or not resulting in
any liability and all amounts paid in settlement of claim or action,
but taking into account any Offsetting Benefit.
"Management Agreement" means a management agreement substantially in the form of
Annexure B.
"Non-Compete Agreement" means the non-compete agreement to be entered into
between OSI and Leone Xxxxxxx Xxxxxxx, substantially in the form of Annexure H.
"Offsetting Benefit" means any saving or benefit on the part of OSI including a
reduction in cost or in any Tax which is attributable to any Warranty Claim
Event.
"Operative Date" means the date of this document.
"Plant and Equipment" means all plant and equipment specified in Annexure C.
"Premises" means the location from which the Business is conducted as specified
in Schedule 2.
"Proceeding" includes any claim, suit or litigation whether:
criminal, administrative or by way of arbitration; or
before any court, arbitrator, expert, tribunal, governmental board, commission,
authority, agency, department, officer or otherwise.
"Purchase Price" means the amount set out in clause 2.2, adjusted for the
Employee Retention Payment Amount and the Warranty Payment Amount and for any
other adjustments required to be made hereunder.
"Related Body Corporate" of a corporation means another corporation which is
related to the first corporation within the meaning of s 50 of the Corporations
Law.
"Release Date" means the date that is one year after the Completion Date.
"Relevant Information" means all information which has been given to OSI or
OSI's advisers by or on behalf of OT or which has otherwise been obtained by
them including, without limitation, information supplied by the directors,
auditors or other officers or employees of OT.
"Risk Assumption Date" means 21 February 1997.
"Specified Contract" means each and every contract, agreement and arrangement
relating to the Business, whether oral or written, as at the Completion Date
specified in Schedule 3
"Taxes" includes:
all taxes levied, imposed or assessed under to the Income Tax Act or any other
statute, ordinance or law, in Australia or elsewhere: and
taxes in the nature of sales tax, consumption tax, value added tax, payroll tax,
group tax, PAYE, undistributed profits tax, fringe benefits tax, recoupment tax,
withholding tax, land tax, water rates, municipal rates, stamp duties, gift
duties or other state, territorial, Commonwealth or municipal charges or
impositions levied, imposed or collected by any government body, together with
any additional tax, interest, penalty, charge, fee or other amount of any kind
assessed, charged or imposed in relation to the non, late or short payment of
the same or the failure to file any return.
"Termination Date" means 28 March 1997 or such other date as may be agreed by OT
and OSI in writing.
"Termination Deed" means the deed to be entered into by OT and OSI in the form
of Annexure F.
"Transferring Employee" means each of the Employees to whom OSI makes an offer
of employment or engagement and who accepts OSI's offer of employment or
engagement.
"Warranties" means all of the representations of OT in this document including
those set out in Schedule 1.
"Warranties Retention Reserve" means 12.5% of the Purchase Price.
"Warranty Claim Event" means a circumstance which entitles OSI to make a claim
upon OT for a breach of the Warranties.
"Warranty Claim Notice" means a written notice from OSI to OT and to the Escrow
Agent which makes a claim on OT for breach of the Warranties and which specifies
what the Warranty Claim Event is and what Loss OSI has sustained each in
sufficient detail to enable OT to determine the sustainability of the claim
together with a statement of what, if any, Offsetting Benefit arose.
"Warranty Payment Amount" means:
the amount specified in a Warranty Claim Notice as the Loss minus any Offsetting
Benefit specified therein; or
where the Expert makes a decision, the amount, if any, so determined by the
Expert.
Construction
Unless expressed to the contrary:
words importing:
the singular include the plural and vice versa; and
any gender includes the other genders;
if a word or phrase is defined cognate words and phrases have corresponding
definitions;
a reference to:
a person includes a firm, unincorporated association, corporation and a
government or statutory body or authority;
a person includes its legal personal representatives, successors and assigns;
a statute, ordinance, code or other law includes regulations and other statutory
instruments under it and consolidations, amendments, re-enactments or
replacements of any of them;
a right includes a benefit, remedy, discretion, authority or power;
an obligation includes a warranty or representation and a reference to a failure
to observe or perform an obligation includes a breach of warranty or
representation;
provisions or terms of this document or another document, agreement
understanding or arrangement include a reference to both express and implied
provisions and terms;
time is to local time in New South Wales;
unless otherwise indicated, "$" or "dollars" is a reference to the lawful
currency of Australia;
this or any other document includes the document as varied or replaced and
notwithstanding any change in the identity of the parties;
writing includes any mode of representing or reproducing words in tangible and
permanently visible form, and includes facsimile transmission;
any thing (including, without limitation, any amount) is a reference to the
whole or any part of it and a reference to a group of things or persons is a
reference to any one or more of them.
a reference to this agreement includes all schedules, annexures and
appendices referred to in it;
Headings
Headings do not affect the interpretation of this document.
SALE AND PURCHASE OF THE BUSINESS
Sale and purchase of the Business
Subject to clause 3, on the Completion Date OT shall, as beneficial owner, sell
free from Encumbrances, and OSI, or a Related Body Corporate of OSI, (relying on
the Warranties and the indemnities in this agreement) shall purchase as at and
from Completion free from Encumbrances the Business together with all rights
attaching to the Business including, without limitation, the Assets for the
Purchase Price.
Purchase Price
The purchase price is US$3.5 million in respect of the Assets, adjusted in
accordance with clause 5.3.
Time and manner of payment
OSI shall pay, or cause a Related Body Corporate to pay:
to OT (or as OT's solicitors direct in writing) by unendorsed bank cheque issued
by a bank acceptable to OT on the Completion Date the Completion Amount;
to the Escrow Agent by unendorsed bank cheque issued by a bank acceptable to OT
on the Completion Date the Warranties Retention Reserve; and
to the Escrow Agent by unendorsed bank cheque issued by a bank acceptable to OT
on the Completion Date the Employee Retention Reserve.
Investment of the Escrow Amount
The parties shall ensure that pending the release of any Escrow Amounts, the
Escrow Amounts shall be invested by the Escrow Agent in a cash management
account. The interest therefrom shall belong exclusively to OT.
Release of the Escrow Amount
On the date that is 2 weeks from Completion, the Escrow Agent is to:
pay to OSI the amount of the Employee Retention Payment Amount that is not in
dispute; and
pay to OT the amount of the Employee Retention Reserve held pursuant to this
agreement less the amount of the Employee Retention Payment Amount (but for the
avoidance of doubt, any amount of the Employee Retention Payment Amount in
dispute will be paid in accordance with clause 2.5(a)(iii);
pay any amount of the Employee Retention Amount that is disputed in accordance
with the written directions of the parties or the Expert, as the case may be, as
determined in accordance with clause 5.2(d); and
On the Release Date, the Escrow Agent is to release to OT the amount of the
Warranties Retention Reserve held pursuant to this agreement as is remaining
less:
any Warranty Payment Amounts paid to OSI in accordance with clause 9; and
any amount of Warranty Payment Amount in dispute and being determined in
accordance with clause 9.
Following the resolution of any dispute in accordance with the procedures set
out in clause 9, the Escrow Agent shall pay the balance of the Warranties
Retention Reserve (if any) to the parties entitled thereto.
Conversion to Australian Dollars after Completion
The parties acknowledge that, to facilitate transactions and adjustments
pursuant to this agreement, on Completion the Purchase Price will be converted
to Australian Dollars at the exchange rate prevailing at the time of Completion
and all obligations and adjustments to be made pursuant to this agreement may be
thereafter settled in Australian Dollars.
CONDITIONS PRECEDENT TO COMPLETION
Conditions to be satisfied by OT
All of the obligations of OSI under this agreement are subject to the
satisfaction, at Completion, of each and every one of the conditions precedent
set out in this clause 3.1 in form and substance to the satisfaction of OSI in
its sole and absolute discretion.
OSI may waive any or all of these conditions in whole or in part without prior
notice. No such waiver of a condition constitutes a waiver by OSI of any of its
other rights or remedies at law or in equity:
accuracy of the Warranties: the Warranties being true and correct in all
material respects on and as of the Completion Date as though made on, applicable
at, and updated through and including, that time;
compliance with this document: OT having performed, satisfied and complied with
all covenants, agreements and conditions required by this document to be
performed or complied with or by OT;
no material adverse change: during the period from the Operative Date to the
Completion Date, there not having been any material adverse change in the
Business or the condition or value of the Assets;
Management Agreements: the Key Employees entering into Management Agreements on
or before the Completion Date with OSI or a Related Body Corporate of OSI;
Release of Liens: OT, on or before Completion procuring that any and all
Encumbrances against the Assets are released, including but not limited to the
Commonwealth Bank fixed and floating charge, Australian Securities Commission
charge number 424483 and the JNA fixed and floating charge, Australian
Securities Commission charge number 505463;
Escrow Agreement: the Escrow Agent entering into the Escrow Agreement;
Deed of Novation: the parties entering into the Deed of Novation in respect of
the Specified Contracts with effect on and from Completion;
Non-Compete Agreement: OT procuring the execution of the Non-Compete Agreement
with effect on and from Completion;
Termination Deed: the parties entering into the Termination Deed in respect of
the Distribution Agreement with effect on and from Completion;
Optus Confirmation: confirmation from Optus Vision Pty Limited, in a form
satisfactory to OSI, of the material terms of the Specified Contract.
Fulfilment of conditions
Each of the parties shall use their best efforts and endeavours to procure the
due fulfilment of the conditions precedent referred to in clause 3.1.
Termination Date
If the conditions precedent in clause 3.1 are not fulfilled by the Termination
Date then this agreement may be terminated by OSI at any time after the
Termination Date by notice given by OSI to OT. If so terminated this agreement
is of no further force and effect and the parties are released from their
obligations under this document and no party is under any obligation to any
other party otherwise than in respect of a breach committed prior to such
termination.
COMPLETION
Time and place of Completion
Completion is to take place on 17 March 1997 in the offices of Corrs Xxxxxxxx
Westgarth or at such other place as may be agreed in writing between OT and OSI
or at such other date agreed by OT and OSI in writing.
Delivery by OSI
On Completion OSI shall:
Purchase Price: pay the Purchase Price in accordance with clause 2.3 and make
the other payments referred to in clause 2.3; and
Specified Contract: accept from OT an assignment or novation of the Specified
Contracts and take possession of the Assets; and
Termination Deed: provide OT with an executed counterpart of the Termination
Deed.
Delivery by OT
On Completion OT shall cause to be delivered to OSI:
Contract Benefits: the Contract Benefits;
Business Records: the Business Records including without limitation all lists of
customers, books of account and records relating to the Business (but not those
relating to the general affairs of OT or to any assets of OT not being sold to
OSI save that, insofar as such excluded lists, books and records relate to the
Business and be reasonably required by OSI, OSI has the right to examine them at
all reasonable times and freely to make copies of the record and to take
extracts from the record) and OSI shall cause all information other than that
which relates to the Business to be kept confidential;
Termination Deed: an executed counterpart of the Termination Deed; Specified
Contract: an assignment or novation of the Specified Contracts and the Assets;
and
other: all such other documents and things as are reasonably required by OSI for
vesting in OSI the full possession of the Business and Assets and all right,
title, interest and benefit to the Business and the Assets.
Further actions by OT
OT shall do all such other things as are required by this agreement to be done
by OT at Completion or as are reasonably required by OSI whether before or after
Completion for vesting in OSI the full possession of the Business and the Assets
and all interest in the Business and the Assets, including all things reasonably
required by OSI to transfer or assign any future projects or opportunities that
OT or a Related Body Corporate of OT receives after Completion that relate to
the Distribution Agreement or the Specified Contracts, and includes, without
limitation, any arrangement or agreement entered into with Optus Vision Pty
Limited in respect of "On-Line" services.
Passing of title
Unencumbered legal and beneficial title to the Business and in the Assets passes
to OSI on Completion.
Passing of risk
Risk in the Business and in all the Assets passes to OSI on the Risk Assumption
Date in accordance with clause 4.8.
Interdependence of obligations
The obligations of the parties in relation to Completion are interdependent so
that OSI is not obliged to complete the purchase of the Business unless the
purchase of all the Assets is completed simultaneously.
All actions at Completion take place simultaneously and no delivery or payment
is to be taken to have been made until all deliveries and payments have been
made.
Risk Assumption Date
The parties have agreed that OT will conduct the Business with effect from the
Risk Assumption Date in accordance with the Budget Schedule for the benefit of
OSI and accordingly, OSI shall reimburse and indemnify OT against the expenses
of normal operations of the Business after the Risk Assumption Date, provided
such expenses are consistent with the types and amounts in the Accounts, and OT
shall pay to OSI all revenues derived from the Business after the Risk
Assumption Date. OT may not set off any of its costs and expenses against
revenue without the prior consent of OSI.
EMPLOYEES
Termination of employment
OT shall, effective from the Completion Date, terminate the employment of all of
the Employees. OSI must, on the Completion Date, offer to employ all of the
Employees on the terms set out in the Employee Offer Letters and Consulting
Agreements.
Employees not employed by OSI
OT shall pay to those of the Employees who do not work for OSI all amounts due
and owing to them in respect of accrued salary or wages, holiday pay and long
service leave pay and any other lawful or customary severance or termination
payment; and
OT acknowledges that the Employees are a valuable component of the Business and
Assets being acquired by OSI pursuant to this agreement and that OSI is seeking
to employ all the Employees named in Annexure D.
OSI may not give an Employee Retention Claim Notice unless it has made bona fide
offers of employment in accordance with clause 5.1 on or about Completion.
If there is an Employee Retention Claim Event and OSI wishes to make a claim on
OT in respect of that Employee Retention Claim Event OSI must give an Employee
Retention Claim Notice on or before the end of two weeks after Completion. OT
must advise OSI within 7 days whether it agrees with such Notice and if it does
not agree it must give its reasons in such detail as the Notice and the
circumstances permit. Where OT does not agree, OT and OSI will meet to discuss
and resolve their disagreement acting in good faith. If they are unable to do so
within 30 days from the commencement of discussions, the matter shall be
referred to the Expert who will make a decision on the matter and in so acting
the Expert will be acting as an expert and not an arbiter and its decision will
be final. The Expert may include in its decision a determination as to the
payment of its costs provided that where it does not, OT and OSI will bear such
costs equally.
For the avoidance of doubt, the Employee Retention Reserve is the maximum amount
by which OSI may claim against in respect of an Employee Retention Claim Event.
Transferring Employees
In respect of each Transferring Employee, OT shall:
deliver to OSI or its representative not less than three Business Days prior to
Completion full details in writing of his or her accrued or accruing
entitlements in respect of holiday pay and long service leave and any other
lawful or customary severance or termination payment or entitlement whether
accruing or due and whether actually payable or conditionally payable upon the
happening of a contingency or fulfilment of a condition precedent (arising out
of any legislation, award, agreement or otherwise) as at the Completion Date
which would be payable to such Transferring Employee if his or her employment
were terminated at Completion and in the case of long service leave as if each
Transferring Employee's entitlement accrued from the commencement of that
Transferring Employee's employment in the Business;
allow to OSI on Completion an amount equal to such accrued or accruing
entitlements referred to in clause 5.3(a) but reduced by all entitlements which
have accrued since the Risk Assumption Date.
be allowed by OSI on Completion an amount equal to the total amount of wages or
salaries paid by OT to the Transferring Employees in respect of any period after
the Risk Assumption Date; and
Terms of employment
In consideration of the allowance made in clause 5.3(b), OSI shall take over the
responsibility for accrued salary, holiday pay, sick leave and long service
leave as at the Completion Date for each of the
Transferring Employees. The Transferring Employees will be, subject to any
statutory entitlements to the contrary, offered allowances and entitlements in
accordance with the Employee Offer Letter and/or the Consulting Agreements, and
in any event the remuneration package of each Transferring Employee will be at
least as favourable to each Transferring Employee as his/her existing
remuneration entitlements.
OT's indemnity with respect to the Transferring Employees
OT indemnifies OSI in respect of the workers' compensation and common law claims
in relation to any Transferring Employee arising from service prior to the Risk
Assumption Date. After the Risk Assumption Date OSI shall provide suitable
records and otherwise use its best endeavours to assist OT to defend claims for
workers compensation and common law claims payments for which it is alleged OT
is liable.
OSI's indemnity with respect to the Transferring Employees
OSI indemnifies OT (but only to the extent of any allowance) against all losses
incurred by OT in respect of any Transferring Employee's entitlement to wages
and salaries, holiday pay or long service leave pay against OT by any
Transferring Employee.
Superannuation
OSI shall, subject to any statutory entitlement to the contrary, fund each
Transferring Employees' superannuation fund in accordance with OSI's current
policies for employment.
CONTINUITY OF BUSINESS
On Completion, OT will grant to OSI a licence to occupy and use the Premises for
the Business Handover Period (or such other period as agreed between the parties
in writing) to enable OSI to continue the Business after Completion. OSI will
pay OT the reasonable ongoing expenses attributable to that part of the Premises
used by OSI. OT will invoice OSI on a monthly basis for the actual reasonable
on-going expenses incurred by OT on behalf of OSI and OSI will promptly pay such
invoices. OT shall provide to OSI with each invoice a detailed expense report to
substantiate that invoice.
OT will provide assistance to OSI during the Business Handover Period in
relation to the conduct of the Business (which will be conducted by OSI or a
Related Body Corporate of OSI entirely at the risk of OSI). OSI will indemnify
OT against all costs, expenses and losses incurred by OT as a result of any
action or omission on the part of OSI in relation to the conduct of the Business
during the Business Handover Period. OSI and OT will, at the expiry of the
Business Handover Period, meet to determine the Business Handover Period
Adjustment.
ASSIGNMENT OF CONTRACT
Assignment of the Specified Contract
OT novates to OSI each and every Specified Contract by way of a Deed of
Novation, with effect from the Completion Date. If any other party to any
Specified Contract objects to such assignment or novation the provisions of
clause 7.2 shall apply:
Non-assignment of the Specified Contracts
OT undertakes to OSI, in the situation where any third party to a Specified
Contract refuses its consent to an assignment or novation:
to duly perform the contract with the assistance of such employees and materials
of OSI which OSI shall make available as and when reasonably necessary at no
expense to OT;
to delegate management to OSI if it is reasonably possible to do so;
to enforce the contract against the other party or parties to the relevant
Specified Contract in such manner as OSI may direct from time to time, at no
expense to OT;
not to agree to any amendment to the Specified Contract or waiver of OT's rights
under the relevant Specified Contract without the prior written approval of OSI;
to account to OSI forthwith for all monies received by OT or goods or services
supplied to OT in respect of the performance by it of the relevant Specified
Contract;
OSI will indemnify OT for the costs and liabilities OT incurs as a result of
acting under the direction of OSI pursuant to clause 7.2.
Assumption of liabilities by OSI
OSI assumes only those liabilities of OT specifically relating to the Specified
Contracts, the Transferring Employees and the Assets as assumed by OSI under
this agreement.
WARRANTIES
The Warranties
OT warrants to OSI that on the signing of this document and as at Completion the
Warranties, Schedules, Annexures and Recitals are true, complete, accurate and
not misleading in any way subject to each and every matter expressly disclosed
in the Disclosure Letter.
The Warranties repeated
The Warranties are taken to be repeated immediately before Completion with
reference to the facts then existing subject always to each and every matter
expressly disclosed in the Disclosure Letter.
Access to facilities
OT shall give OSI or its representatives access to all such facilities as OSI
reasonably requires to enable OSI to be satisfied with regard to the accuracy of
the Warranties. Neither this clause 8.3 nor the exercise by OSI of any of the
rights comprised in this clause in any way reduces or otherwise affects the
liability of OT.
Warranties survive Completion
The Warranties do not merge but survive Completion for the benefit of OSI.
Limitation of liability for breach of Warranties
OT is not liable to OSI in connection with the Warranties unless OSI has given a
Warranty Claim Notice to OT in accordance with clause 9 within one year of
Completion. In no event is OT liable to indemnify OSI for any Loss greater than
the Purchase Price.
WARRANTY RETENTION RESERVE CLAIM PROCEDURE
Warranty Claim Notice
If there is a Warranty Claim Event and OSI wishes to make a claim on OT in
respect of that Event, OSI must give a Warranty Claim Notice. OT must advise OSI
within 30 days whether it agrees with such Warranty Claim Notice and if it does
not agree it must give its reasons in such detail as the Notice and the
circumstances permit. Where OT does not agree OT and OSI will meet to discuss
and resolve their disagreement acting in good faith. If they are unable to do so
within 30 days from the commencement of discussions, the matter shall be
referred to the Expert who will make a decision on the matter and in so acting
the Expert will be acting as an expert and not an arbiter and its decision will
be final. The Expert may include in his decision a determination as to the
payment of its costs provided that where it does not, OT and OSI will bear such
costs equally.
Warranty Payment Amount
The Escrow Agent must pay to OSI the Warranty Payment Amount once it has been
finally determined.
OT'S OBLIGATIONS
Accounting records
OT covenants that for such time as is required by law it shall keep and make
available to OSI all accounting records and the documents of OT with respect to
the Business and the Assets which remain in the possession or control of OT
after Completion (whether on computer or otherwise) for such purposes as OSI may
require including, without limitation, for the purpose of making or considering
a claim against OT.
Confidentiality
Save for disclosure in accordance with statutory and other legal obligations no
disclosure is to be made of any of the financial or trade secrets of the
Business by OT to any third party except to OT's professional advisers and
bankers.
Conduct of the Business and the Assets pending Completion
OT covenants that from the Risk Assumption Date until the date of this document
the Business has been carried on in accordance with the Budget Schedule and from
the date of this document until Completion, OT shall carry on the Business and
maintain the Assets in the ordinary course consistent with past practice. In
addition, OT covenants that it shall not do any of the following in relation to
the Business and the Assets without the prior written consent of OSI:
actions in relation to Warranties: take any action that would or might result in
any of the Warranties becoming untrue in any respect;
compliance with law: do any act or thing or suffer or permit any omission in
contravention or breach of any of the provisions of any law including, without
limitation, any exchange control regulation, Taxation statute, the Corporations
Law or the Trade Practices Act;
unusual contracts: enter into any contracts, agreements, arrangements,
obligations, undertakings, purchase or sale agreements in respect of the
Business or the Assets not capable of termination on 90 days notice or less or
any service employment or other agreement not capable of termination on 30 days
notice or less; industrial award: do any act or thing the doing or suffer or
permit any omission of which is or could be a breach of:
any industrial or similar award; or
any determination or order of any tribunal, person or body empowered to
determine any dispute relating to the rights or duties of the Business, or of
any trade union or member of a trade union pursuant to any industrial or similar
award;
any term contained or implied in any industrial agreement between OT and any
trade or labour union;
Employees: alter the basis of remuneration payable to any of the Employees;
Specified Contracts: breach any term contained in or implied in any of the
Specified Contracts; or
agree, whether in writing or otherwise, to do any of the above.
Litigation
If OT becomes aware of any Proceedings actual, pending or threatened against the
Assets prior to Completion OT shall immediately disclose all facts and
circumstances known to OT relating to such proceedings and continue to keep OSI
informed about any such Proceedings and use its best endeavours not to become
involved in any Proceedings. The parties acknowledge that OT has complied with
this obligation in relation to Proceedings instituted by JNA Telecommunications
Limited.
Availability of information to OSI
Both before and after Completion OT covenants to make available to OSI free of
charge all information which OT has available to it which OSI may reasonably
require relating to the Business and the Assets.
Compliance with the Law
OT covenants that prior to the Completion Date all returns and other documents
which may be required to be filed in respect of the Business and the Assets
under any applicable legislation shall be properly filed.
Statutory notices
OT covenants to comply with any notice affecting or relating to OT, the Business
or the Assets issued by any competent authority issued on or before the
Completion Date.
Costs of obtaining third party consents
Except where OSI has an obligation to do so pursuant to this agreement, OT will
promptly pay all legal and other costs relating to the obtaining of any consent
from any third party in connection with this agreement.
Correct information
All Relevant Information relating to the revenue and cost information in respect
of the Specified Contracts, the Employees and the Accounts was when given and is
true, complete and accurate in all respects.
Obligation to update information
Where a prediction, projection or expectation concerning any future matter or
state of affairs is included in the Relevant Information which was provided by
OT and any event occurs or becomes known to OT before Completion which adversely
affects the accuracy of that prediction, projection or expectation in a material
particular OT shall immediately notify OSI of all relevant particulars of that
event.
OSI'S OBLIGATIONS
Prior to Completion
OSI covenants that on or prior to Completion it shall:
supply references: promptly supply such references and do all such other acts
matters and things as may reasonably be required by third parties in considering
applications for the novation of the Specified Contracts to OSI; and
information supplied to OSI: OSI covenants that it will at all times keep and
maintain confidential all information obtained by it during the course of any
access granted to OSI pursuant to this agreement and not otherwise conveyed to
OSI by this agreement. This clause will not merge on Completion.
INDEMNITY BY OT
OT indemnifies OSI from and against any Loss incurred or suffered by OSI arising
from or in connection with a Warranty Claim Event or a breach of any other term
of this agreement. Subject to clause 9, and in
circumstances where the Loss attributable to a Warranty Claim Event cannot be
met by funds available in the Warranty Retention Reserve, OT shall pay to OSI
upon demand an amount equal to the difference (determined pursuant to the
provision appearing immediately below) between the actual value of any asset
affected by any Warranty which is breached and the value it would have had if
the Warranty were correct or in the case of an undisclosed liability the amount
of that liability determined in the same way.
The difference in value or the amount of liability referred to in the above
paragraph is the amount as OT and OSI agree or failing agreement determined by
the Expert. The Expert shall determine the difference acting as an expert and
not as an arbiter and its decision in writing and signed by it is conclusive and
binding upon the parties and the costs of that determination may at its
discretion be added to the difference so determined and payable or otherwise
awarded.
TERMINATION
OSI's termination events
This agreement may be terminated by OSI at any time prior to Completion upon the
happening of any of the following events:
the occurrence of any Insolvency Event with respect to OT;
by mutual agreement of OT and OSI.
Other termination events
This agreement may be terminated at any time prior to Completion by either OSI
or OT upon written notice to the other if:
any of the representations or warranties of the other party or parties as the
case may be contained in this agreement proves to be inaccurate or untrue in any
material respect; or
any obligation to be performed kept or observed by such other party or parties
as the case may be under this agreement has not been performed kept or observed
in any material respect at or prior to the time specified in this agreement.
A breach or non-observance of any one or more of the representations,
warranties, covenants or obligations set out in this agreement is of a material
nature if singularly or in the aggregate it has or they have or are likely to
have a materially adverse affect on the Business. If such notice is given the
party or parties receiving such notice has 10 days within which to cure, if
capable of cure, the specified defect before this agreement may be terminated
and, when appropriate, the Completion Date is to be delayed accordingly.
Termination prior to Completion
If this agreement is validly terminated prior to the Completion Date the parties
are discharged from all their obligations under this agreement and no party is
entitled to claim against the other for any compensation for costs or expenses
incurred as a result of entering into this agreement.
WARRANTY BY OSI
OSI warrants to OT that:
it has the legal right and power to enter into this agreement and to purchase
the Assets from OT on and subject to the terms of this agreement;
the execution, delivery and performance of this agreement by OSI has been duly
and validly authorised by all necessary corporate action on its part;
this agreement is a valid and binding agreement on OSI, enforceable in
accordance with its terms; and
the execution and performance of this agreement by OSI and the other
transactions contemplated by this agreement does not violate or conflict with or
result in a breach of or constitute a default under the provisions of the
memorandum and articles of association of OSI.
ANNOUNCEMENTS
Confidentiality
Prior to Completion:
the negotiations of the parties or the subject matter or terms of this agreement
are to be kept confidential and released to third parties (other than the
parties' professional advisers or where disclosure is required by law) only with
the mutual written consent of the parties to this agreement; and
the parties shall mutually consent in writing to any press release, circular or
announcement (such consent not to be unreasonably withheld) related to the
subject matter of this agreement.
Stock Exchange
In relation to any report to any stock exchange pertaining to the negotiations
of the parties or the subject matter or the terms of this agreement the
notifying party shall whenever practicable, in advance of reporting to the stock
exchange, advise the other of the text of the proposed report and provide the
other party with a reasonable opportunity of making comment upon the form and
content before the report is issued.
NOTICES
General
A notice, demand, certification or other communication under this document:
is to be given in writing and in the English language; and
may be given by an agent of the sender.
Method of service
In addition to any means authorised by law a communication may be given by:
being delivered personally;
being left at the party's current address for service;
being sent to the party's current address for service by pre-paid ordinary
mail or if the address is outside Australia, by pre-paid air mail; or
facsimile to the party's current facsimile number.
Address for service
The addresses and facsimile numbers are initially:
in the case of OSI:
Objective Systems Integrators Inc.
000 Xxxx Xxxxxx Xxxx
Xxxxxx, Xxxxxxxxxx
Xxxxxx Xxxxxx of America
Tel: 0000 0 000 000 0000
Fax: 0000 0 000 000-0000
Attention: XX Xxxxxx/Xxxxxx Xxxxxxx
with a copy to:
Corrs Xxxxxxxx Westgarth
Governor Xxxxxxx Tower
0 Xxxxxx Xxxxx
Xxxxxx, Xxx Xxxxx Xxxxx
Xxxxxxxxx
Tel: 000 0000 0000
Fax: 000 0000 0000
Attention: X X Xxxxx
in the case of OT:
Xxxxx Xxxxxxx
Xxxxx 00, 00 Xxxxx Xxxxxx
Xxxxx Xxxxxx, Xxx Xxxxx Xxxxx
Xxxxxxxxx
Tel: 00 0 0000 0000
Fax: 00 0 0000 0000
Attention: Xx Xxxxx Xxxxxxx
with a copy to:
Larbalestier & Co
Xxxxx 00, Xxxxxxxx Xxxxx
00 Xxxxxx Xxxxxx
Xxxxxx, Xxx Xxxxx Xxxxx
Xxxxxxxxx
Tel: 000 0000 0000
Fax: 000 0000 0000
Attention: Xxxx Xxxxxxxxxxxx
A party may from time to time change its address or numbers for service by
notice to the other party.
Service by post
A communication given by post is taken to be received:
if posted within Australia to an Australian address three Business Days after
posting; and
in any other case, seven Business Days after posting.
Service by facsimile
A communication given by facsimile is taken to be received when the sender's
facsimile machine produces a transmission report stating that the facsimile was
sent to the addressee's facsimile number.
Form received
A communication given by facsimile is taken to be given in the form transmitted
unless the message is not fully received in legible form and the addressee
immediately notifies the sender of that fact.
Process service
Any process or other document relating to litigation, administrative or arbitral
proceedings in relation to this document may be served by any method
contemplated by this clause in addition to any means authorised by law.
Service after hours
If a communication to a party is received by it:
after 5.00pm in the place of receipt; or
on a day which is not a Business Day,
it is taken to have been received at the commencement of the next Business
Day.
MISCELLANEOUS
Stamp Duty
OSIOSI shall, as between the parties, be liable for and duly pay all stamp duty
(including any fine or penalty except where it arises from default by the other
party) on or relating to this agreement and any document executed under it.
If a party other than OSI pays any stamp duty (including any fine or penalty) on
or relating to this agreement or any document executed under it, OSI shall pay
that amount to that party upon demand.
Legal Costs
Subject to any express provision in this document to the contrary, each party
shall bear its own legal and other costs and expenses relating directly or
indirectly to the preparation of, and performance of its obligations under, this
agreement.
Amendment
This agreement may only be varied or replaced by a document duly executed by
the parties.
Waiver and Exercise of Rights
A single or partial exercise or waiver of a right relating to this agreement
will not prevent any other exercise of that right or the exercise of any other
right.
A party will not be liable for any loss, cost or expense of any other party
caused or contributed to by the waiver, exercise, attempted exercise, failure to
exercise or delay in the exercise of a right.
Rights Cumulative
Subject to any express provision in this document to the contrary, the rights of
a party under this agreement are cumulative and are in addition to any other
rights of that party.
Approvals and Consent
Subject to any express provision in this agreement to the contrary, a party may
conditionally or unconditionally give or withhold any consent to be given under
this agreement and is not obliged to give its reasons for doing so.
Further Assurance
Each party shall promptly execute all documents and do all things that any other
party from time to time reasonably requires of it to effect, perfect or complete
the provisions of this agreement and any transaction contemplated by it.
Computation of Time
Where time is to be reckoned by reference to a day or event, that day or the day
of that event is excluded.
Governing Law and Jurisdiction
This document is governed by and is to be construed in accordance with the laws
in force in New South Wales.
Each party irrevocably and unconditionally submits to the non exclusive
jurisdiction of the courts of New South Wales and any courts which have
jurisdiction to hear appeals from any of those courts and waives any right to
object to any proceedings being brought in those courts.
Assignment
A party shall not dispose of or encumber any right under this agreement without
the prior written consent of the other party.
Joint and Several Liability
An obligation of two or more persons binds them jointly and severally.
Counterparts
This agreement may consist of a number of counterparts and if so the
counterparts taken together constitute one and the same instrument.
Entire Understanding
This document embodies the entire understanding and agreement between the
parties as to the subject matter of this agreement.
All previous negotiations, understandings, representations, warranties,
memoranda or commitments in relation to, or in any way affecting, the subject
matter of this document are merged in and superseded by this document and shall
be of no force or effect whatever and no party shall be liable to any other
party in respect of those matters.
No oral explanation or information provided by any party to another shall:
affect the meaning or interpretation of this document, or
constitute any collateral agreement, warranty or understanding between any
of the parties.
EXECUTION
Executed as a deed in New South Wales.
SIGNED for and on behalf of )
OBJECTIVE SYSTEMS )
INTEGRATORS PTY LIMITED ) /s/ Xxxxxx X. Xxxxxx
by a director of the company ) --------------------------
in the presence of: ) Xxxxxx X. Xxxxxx, Director
/s/ Xxxxx X. Xxxxxx Witness
------------------------------------
XXXXX X. XXXXXX Name of Witness (print)
------------------------------------
THE COMMON SEAL of )
OPEN TECHNOLOGY PTY LIMITED )
was affixed in the presence of: ) [SEAL]
/s/ Leone Xxxxxxx Xxxxxxx Director
------------------------------------
XXXX XXXXXXX XXXXXXX Name of Director (print)
/s/ Xxxxx Xxxxxxx Secretary/Director
------------------------------------
XXXXX XXXXXXX Name of Secretary/Director (print)
SCHEDULE 1
WARRANTIES
Index to Warranties
Ownership of Assets
Accurate information
Litigation
Insolvency etc.
Contracts and Specified Contracts
Employees
Compliance with law/licences
Business Records
Statutory notices
Corporate power
Corporate action
Plant and equipment
Stamp duty
Effects of this agreement
Taxation
Accounts
Position since Account Date
Liabilities and commitments
Agent
("Warranties")
Except as disclosed in the Disclosure Letter, OT hereby represents and warrants:
Ownership of Assets
OT is the sole absolute beneficial owner of the Assets and the Assets are
entirely free from all Encumbrances or charges of any description and no other
person has or will have any adverse claim in respect of the Assets.
The Assets are in the possession or under the control of OT and have not been
depleted by any unlawful act on the part of any person.
Accurate information
All Relevant Information relating to the revenue and cost information in respect
of the Specified Contracts, the Employees and the Accounts is accurate in all
respects and there are no material omissions.
Litigation
Except as plaintiff in the collection of debts arising in the ordinary course of
business (none of which exceeds $5,000), OT (nor any person for whose acts or
defaults OT may be vicariously liable) is not a plaintiff or defendant in or
otherwise a party to any Proceedings in progress or threatened or pending by or
against or concerning OT or any of its assets used in connection with the
Business.
No investigation or inquiry is in progress or pending in connection with OT or
the Assets.
OT is not aware of any circumstances which could give rise to any of the events
specified in clauses SC1.3(a) and (b).
Insolvency etc.
No Insolvency Event has occurred in relation to OT.
There are no unsatisfied or partly satisfied judgments or writs of execution
against either OT or the Assets.
OT is not aware of any circumstances which could give rise to any of the events
specified in clauses SC1.4(a) and (b).
Contracts and Specified Contracts
There are no contracts, agreements, arrangements, obligations, undertakings,
purchase or sale agreements in respect of the Assets (including the Specified
Contracts) which arose other than in the ordinary course of business or in any
case of longer than 90 days duration incurred or entered into by OT.
There are no service, employment or other agreements not terminable on 30 days
(or shorter) notice.
OT has not made any offers, tenders or quotations in relation to the Business
other than at the request of OSI which are still outstanding and capable of
giving rise to a contract by the unilateral act of a third party, other than in
the ordinary course of ordinary business and on customary terms. No notice or
process has been served on OT which might impair the exercise of its rights
under any agreement to which it is a party which would affect the subject matter
of this agreement.
There has been no material breach or non-performance of any term of any
Specified Contract occurring before the Completion Date.
OT has made full and accurate disclosure regarding the total amount of work to
be performed after Completion in respect of the Specified Contracts, including
an estimate of the projected income and expense of such work.
All work performed by OT in respect of the Specified Contracts up to Risk
Assumption Date has been fully invoiced in accordance with the Specified
Contracts.
OT has, from the Risk Assumption Date until Completion, performed the
obligations required by it under the Specified Contracts in good faith and in
accordance with the Budget Schedule.
The Specified Contract Representations set out in Schedule 4 are accurate in all
material respects and there are no material omissions.
Employees
The basis of the remuneration payable to the employees of OT at the Operative
Date is materially the same as that in force at the Accounts Date.
OT is not under any present, future or contingent liability to pay compensation
for loss of office or employment to any ex-officer or ex-employee.
There are no payments due in connection with the redundancy of any employee of
OT.
There are no retirement benefit schemes, pension schemes or other pension
arrangements whether legally enforceable or not relating to OT in operation
which are administered by OT itself.
If the services of all of the employees of OT had been terminated on the
Accounts Date then the amount provided for in the Accounts as at that date for
long-service leave and holiday pay would have been
sufficient to provide for all long-service leave and holiday pay which would
have then been due to (or properly accrued in favour of) such employees.
All amounts of Tax and Superannuation Guarantee Charge which are required by law
to be deducted by OT from the salary or wages of employees have been duly
deducted and, where appropriate duly paid.
Compliance with law/licences
OT has conducted the Business up to and including the Completion Date in
accordance with the law in force in the States and/or Territories for the time
being in which it carries on business.
Business Records
All the Business Records have been fully, properly and accurately kept and
completed (and in relation to Tax records have been kept for the period of time
prescribed by the Income Tax Act and include all necessary information and
records required to be kept under the Income Tax Act in connection with the
calculation and assessment of Tax).
There are no material inaccuracies or discrepancies of any kind contained or
reflected in the Business Records.
The Business Records give and reflect a true and fair view of the financial,
contractual and trading position of OT in connection with the Business and the
Assets (including all working papers that supplement the calculation of Tax), of
its plant and machinery, fixed and current assets and liabilities (actual or
contingent).
All returns, particulars, resolutions and other documents required to be filed
or delivered by OT in connection with the Business and the Assets have been
correctly and properly made out and filed or delivered within the appropriate
time periods.
Statutory notices
There is no outstanding notice affecting or relating to the Business or any of
the Assets issued by any competent authority.
Corporate power
OT is a company duly incorporated and validly existing under the laws of the
State of New South Wales and has full corporate power and authority to own,
operate and conduct the Business.
Corporate action
OT has the legal right and power to enter into this agreement and to sell the
Business and the Assets to OSI on and subject to the terms of this agreement.
The execution, delivery and performance of the agreement by OT has been duly and
validly authorised by all necessary corporate action on its part.
This document is a valid and binding agreement on OT, enforceable in accordance
with its terms.
The execution and performance of this agreement by OT and the other transactions
contemplated by this agreement does not violate or conflict with or result in a
breach of or constitute a default under or result in the imposition of any
Encumbrance under the provisions of the memorandum and articles of association
of OT.
Plant and equipment
The Plant and Equipment specified in the Accounts is in good repair and
condition and in satisfactory working order consistent with its age.
Stamp duty
All documents in the possession of or under the control of OT in connection with
the Business which attract stamp duty in any State of Australia or elsewhere
have been properly stamped and no such documents which are outside any such
State would attract stamp duty if they were bought into such State.
Effects of this agreement
Neither this agreement nor Completion gives rise to a right to terminate any
contractual relationship between OT and any third party which may adversely
affect the Business.
Accounts
Annexure A contains a true, fair and correct copy of the Accounts. The Accounts
have been prepared in accordance with the Accounting Standards without making
any revaluations of any assets and are true, fair and accurate in all respects
and disclose a true and fair view of the state of affairs of OT, its financial
position and the Assets as at the Accounts Date and of its income, expenses and
results of its operations for the financial period ended on that date and there
are no material omissions or inaccuracies.
No material change has occurred in the Assets and liabilities shown in the
Accounts.
The basis of depreciation adopted by OT in the Accounts constitutes proper
provision for depreciation and the values attributable to Assets in the Accounts
as at the Accounts Date.
The Accounts have been prepared in accordance with Accounting Standards and on a
basis consistent with the manner of preparation of the prior year's accounts.
Position since Accounts Date
Since the Accounts Date the Business has been carried on in the ordinary and
usual course and without limiting the generality of the foregoing there has not
been any alteration to the terms of employment of OT's executives or employees.
Liabilities and commitments
There are no Encumbrances on the Assets which have not been disclosed in writing
to OSI.
Agent
No agent has been engaged by OT in obtaining the execution of this document by
OSI; and
No person is entitled to recover any brokerage or commission in relation to this
document.
SCHEDULE 2
PREMISES DETAILS
Address
Use
Lessor
Xxxxx 0, 00 Xxxxxx Xxxxxx
Xxxxx Xxxxxx XXX
Xxxxxxxxx
Commercial Office
Tonicalon Pty Ltd
SCHEDULE 3
SPECIFIED CONTRACTS
OptusVision VNMS Supply Agreement OV 00025-GS between Optus Vision Pty Limited
and Open Technology Pty Limited dated 11 January 1996;
Optus On-Line Contract between Optus Vision Pty Limited and Open Technology Pty
Limited for an estimated revenue of $900,000 (unsigned, but expected to be
signed by 30 June 1997 and work has been already performed as at the date of
this agreement).
SCHEDULE 4
SPECIFIED CONTRACT REPRESENTATIONS
OPTUS VISION SUPPLY CONTRACT
Estimated billings remaining:
US $
AUS $
Notes
Invoiced to Date
$5,109,813.00
$831.031.00
Q3 & Q4 FY97
Year 2 Payment
$647,500.00
Alarms & Performance
$128,343.00
NPS
$106,340.00
24 x 7 Support
$25,000.00
CSPC Enhancements
$130,500.00
ETSI Provisioning
$20,000.00
Subject to Vendor Product Deliveries
A&P for Motorola
$99,000.00
Subject to Vendor Product Deliveries
Q1 FY 98
Balance of A&P
$250,000.00
Q2 FY 98
Warranty Payment
$170,000.00
Year 3 Q1 Payment
$175,750.00
Q3 FY 98
Year 3 Q2 Payment
$175,750.00
Q4 FY 98
Year 3 Q3 Payment
$175,750.00
Q1 FY 99
Year 3 Q4 Payment
$175,750.00
Q2 FY 99
Year 4 Q1 Payment
$148,000.00
Q3 FY 99
Year 4 Q2 Payment
$148,000.00
Q4 FY 99
Year 4 Q3 Payment
$148,000.00
Q1 FY 2000
Year 4 Q4 Payment
$148,000.00
TO BE INVOICED
$2,597,183.00
$274,500.00
Billings in Financial Years 1998 & 1999 are to be billed quarterly in advance.
Invoices are outstanding from OT to Optus Vision Pty Ltd, being invoices up to
21 February 1997.
Estimated costs to complete:
US$400,000
Outline of Tasks required to complete:
Balance of Alarms and Performance
Balance of Networking Provisioning System 2 & 3
24 x 7 Support
ETSI Switch provisioning
Alarms and Procedures for Motorola
Customer Service Provisioning Systems
No additional tasks required to collect US$1.295 million from Optus Vision
Pty Ltd due between July 97 and April 99.
The Plant and Equipment represents sufficient Plant and Equipment to complete
the tasks required under this contract or alternatively, such plant and
equipment will be provided without charge from Optus Vision Pty Limited.
Expected due date for completion:
June 1997
Status of Contract Liabilities:
Description
Status
100 free consulting days.
Completed
3 month warranty for completed software delivered.
Warranty period commences on date of acceptance and most software was delivered
more than three months prior to the Operative Date.
10% penalty on undelivered software which may delay project.
Only applies to original scope of project and therefore very limited as project
schedules have been significantly extended by Optus Vision Pty Ltd - no
significant risk
AUD$7,000 per month system downtime penalty.
This liability may arise under certain situations. However, there are no
outstanding conditions which would invoke this liability.
AUD$150,000 per year penalty for non-compliance with specifications.
Not Applicable: only complying software is accepted by Optus Vision Pty Ltd.
1 Year free technical support
Not Applicable.
EXECUTION
Executed as a deed in New South Wales.
SIGNED for and on behalf of )
OBJECTIVE SYSTEMS )
INTEGRATORS PTY LIMITED )
by a director of the company )
in the presence of: ) Xxxxxx X Xxxxxx, Director
Witness
Name of Witness (print)
THE COMMON SEAL of )
OPEN TECHNOLOGY PTY LIMITED )
was affixed in the presence of: )
Director
Name of Director (print)
Secretary/Director
Name of Secretary/Director (print)
ANNEXURE A
ACCOUNTS
(Attached)
ANNEXURE B
MANAGEMENT AGREEMENT
(Attached)
ANNEXURE C
PLANT AND EQUIPMENT
(Attached)
ANNEXURE D
EMPLOYEES
(See attached)
ANNEXURE E
DEED OF NOVATION
CORRS XXXXXXXX WESTGARTH
Xxxxx 00
0 Xxxxxx Xxxxx
Xxxxxx Xxx Xxxxx Xxxxx 0000
XXXXXXXXX
Telephone (00) 0000 0000
Facsimile (00) 0000 0000
DX 000 Xxxxxx
Ref: XXX/XXX
XXXX0000-000
THIS DEED is made on 19
BETWEEN [ ] (ACN *** *** ***) incorporated in *** of [ADDRESS]
("the Supplier/Customer")
AND OPEN TECHNOLOGY PTY LIMITED ACN 000 000 000 of 0/00 Xxxxxxxxxx Xxxxxx,
Xxxxxxxx, Xxx Xxxxx Xxxxx, Xxxxxxxxx, 0000 ("the Assignor") AND OBJECTIVE
SYSTEMS INTEGRATORS INC of 000 Xxxx Xxxxxx Xxxx, Xxxxxx, Xxxxxxxxxx, XXX, 00000
("the Assignee")
RECITALS
A The Supplier/Customer and the Assignor are parties to the Principal
Agreement.
B The Supplier/Customer has agreed on the terms set out in this document
to release the Assignor from its obligations under the Principal Agreement in
consideration of the Assignee agreeing to perform the Principal Agreement in
substitution for the Assignor on and from the Effective Date.
C The Assignee has agreed to perform the Principal Agreement on the terms
set out in this document.
OPERATIVE PROVISIONS
1 INTERPRETATION
1.1 Definitions
In this document:
"Business Day" means a day on which trading banks are open in Sydney;
"Effective Date" means ***.
"Principal Agreement" means ***.
1.2 Construction
Unless expressed to the contrary:
(a) words importing:
the singular include the plural and vice versa;
any gender includes the other genders;
(b) if a word or phrase is defined cognate words and phrases have
corresponding definitions;
(c) a reference to:
a person includes a firm, unincorporated association, corporation and a
government or statutory body or authority;
a person includes its legal personal representatives, successors and assigns;
a statute, ordinance, code or other law includes regulations and other statutory
instruments under it and consolidations, amendments, re-enactments or
replacements of any of them;
a right includes a benefit, remedy, discretion, authority or power;
an obligation includes a warranty or representation and a reference to a failure
to observe or perform an obligation includes a breach of warranty or
representation.
provisions or terms of this document or another document, agreement
understanding or arrangement include a reference to both express and implied
provisions and terms;
time is to local time in Sydney, Australia;
"$" or "dollars" is a reference to the lawful currency of Australia;
this or any other document includes the document as varied or replaced and
notwithstanding any change in the identity of the parties;
writing includes any mode of representing or reproducing words in tangible and
permanently visible form, and includes facsimile transmission;
any thing (including, without limitation, any amount) is a reference to the
whole or any part of it and a reference to a group of things or persons is a
reference to any one or more of them;
1.3 Headings
Headings do not affect the interpretation of this document.
2 NOVATION
With effect from the Effective Date the Assignor transfers to the Assignee all
its interest in the Principal Agreement.
With effect from the Effective Date:
subject to clause 2(b)(iii), the Supplier/Customer releases the Assignor from
all obligations and liabilities under the Principal Agreement arising on or
after the Effective Date and accepts the undertaking of the Assignee in clause
2(b)(ii) in substitution for the Assignor's obligations and liabilities under
the Principal Agreement;
in consideration of the Assignor's agreement to the release in clause 2(b)(i),
the Assignee undertakes with the Supplier/Customer to observe and be bound by
the terms of the Principal Agreement in substitution for the Assignor as if,
from the Effective Date, the Assignee had been named in the Principal Agreement
in substitution for the Assignor;
notwithstanding the foregoing, the Assignor is bound by all such duties of
confidentiality and non-disclosure as would have been applicable to it under the
Principal Agreement had it continued to be a party to the Principal Agreement.
Each party agrees that clause 2(b) applies without prejudice to any claim or
dispute which may exist or arise with respect to or under the Principal
Agreement in relation to any event or circumstance which occurred prior to the
Effective Date.
3 MISCELLANEOUS
3.1 Stamp Duty
(a) The Assignee shall, as between the parties, be liable for and duly pay
all stamp duty (including any fine or penalty except where it arises from
default by the other party) on or relating to this document and any document
executed under it.
(b) If a party other than the Assignee pays any stamp duty (including any
fine or penalty) on or relating to this document or any document executed under
it, the Assignee shall pay that amount to that party upon demand.
3.2 Legal Costs
Subject to any express provision in this document to the contrary, the Assignor
and the Assignee shall each bear their own legal and other costs and expenses
relating directly or indirectly to the preparation of, and performance of its
obligations under, this document.
3.3 Amendment
This document may only be varied or replaced by a document duly executed by the
parties.
3.4 Further Assurance
Each party shall promptly execute all documents and do all things that any other
party from time to time reasonably requires of it to effect, perfect or complete
the provisions of this document and any transaction contemplated by it.
3.5 Counterparts
This document may consist of a number of counterparts and if so the counterparts
taken together constitute one of the same instrument.
3.6 Governing Law and Jurisdiction
(a) This document is governed by and is to be construed in accordance with
the laws in force in New South Wales.
(b) Each party irrevocably and unconditionally submits to the non-exclusive
jurisdiction of the courts of New South Wales and any courts which have
jurisdiction to hear appeals from any of those courts and waives any right to
object to any proceedings being brought in those courts.
3.7 Notices
(a) Any notice, demand or other communication given under or pursuant to
this deed must be in writing and will be deemed duly given or made if delivered
or sent by post, telex or facsimile transmission as follows:-
(i) to the Supplier/Customer at:
(ii) to the Assignor at:
(iii) to the Assignee at:
(b) Any party may change its address, telex or facsimile numbers for the
purpose of this deed by giving notices of the change to the other parties
pursuant to the provisions of sub-clause (a) above.
(c) Any notice, demand or other communication will be deemed to have been
received by the person to whom it was sent:-
(1) in the case of hand delivery, upon delivery;
(2) in the case of registered mail, upon receipt;
(3) in the case of telex, at the time of despatch provided that the
recipient's telex answerback code appears on the sender's copy of the telex; or
(4) in the case of facsimile transmission, upon receipt.
3.16 Attorneys
Each of the attorneys executing this deed states that he has no notice of the
revocation of the power of attorney under which he executed this deed.
EXECUTED by the parties as a deed
THE COMMON SEAL of (ACN *** *** ***) is affixed in accordance with its
articles of association in the presence of:
)
)
)
)
.........................................
.........................................
.........................................
.........................................
Director
Name of Director (print)
Secretary
Name of Secretary (print)
THE COMMON SEAL of (ACN *** *** ***) is affixed in accordance with its
articles of association in the presence of:
)
)
)
)
.................................
.................................
.................................
.................................
Director
Name of Director (print)
Secretary
Name of Secretary (print)
THE COMMON SEAL of (ACN *** *** ***) is affixed in accordance with its
articles of association in the presence of:
)
)
)
)
.................................
.................................
.................................
.................................
Director
Name of Director (print)
Secretary
Name of Secretary (print)
ANNEXURE F
Termination Deed
(Attached)
ANNEXURE G
Disclosure Letter
(Attached)
ANNEXURE H
Non-Compete Agreement
(Attached)
ANNEXURE I
Employee Offer Letter
(Attached)
ANNEXURE J
Consulting Agreement
(Attached)
ANNEXURE K
Budget Schedule
(Attached)
3
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