EXECUTION COPY
ASSET PURCHASE AGREEMENT
BY AND AMONG
SENTO TECHNICAL INNOVATIONS CORPORATION,
CENTERPOST INNOVATIONS PTY. LTD.,
KILAT HOLDINGS PTY. LIMITED,
AUSTRALIAN SOFTWARE INNOVATIONS (SERVICES) PTY LTD,
AND
ENG XXX AND XXXX XXX, INDIVIDUALLY
DATED AS OF JULY 9, 1997
EXECUTION COPY
ASSET PURCHASE AGREEMENT
THIS ASSET PURCHASE AGREEMENT (this "AGREEMENT") is entered into in Orem,
Utah effective as of the 9th day of July, 1997, by and among Sento Technical
Innovations Corporation, a Utah corporation (the "BUYER"), Centerpost
Innovations Pty. Ltd. ACN 000-000-000, a limited company organized under the
laws of New South Wales, Australia ("CENTERPOST"), Australian Software
Innovations (Services) Pty. Ltd ACN 000-000-000, a limited company organized
under the laws of Australia (the "SELLER"), Kilat Holdings Pty. Limited ACN 003-
982-616, a limited company organized under the laws of Australia ("KILAT"), and
Eng Xxx and Xxxx Xxx (collectively, the "SHAREHOLDERS"), individually.
RECITALS
A. Pursuant to an Option Agreement (the "OPTION AGREEMENT") dated as of
the 10th day of September, 1996 between Buyer, Seller, Kilat and the
Shareholders, Seller granted to Buyer and its nominee, Centerpost, an option
(the "OPTION") to purchase the Assets and the Intellectual Property Assets,
Kilat and the Shareholders agreed to facilitate Buyer's purchase of Assets and
Seller, Kilat and the Shareholders agreed to execute the Deed of Restraint of
Trade.
B. Eng Xxx is the Managing Director of Seller, Kilat owns all of the
issued and outstanding shares of the capital stock of Seller and the
Shareholders own all of the issued and outstanding shares of the capital stock
of Kilat.
C. Buyer has elected pursuant to Section 1.6 of the Option Agreement to
exercise the Option with respect to the Assets and the Intellectual Property
Assets.
D. Centerpost, as Buyer's nominee, desires to purchase the Tangible
Assets from Seller, and Buyer desires to purchase the Intangible Assets and the
Intellectual Property Assets from Seller, and Seller is obligated pursuant to
the Option Agreement to sell the Assets and the Intellectual Property Assets to
Buyer and Centerpost, respectively, in accordance with the terms and conditions
of the Option Agreement. All capitalized terms used herein without definition
shall have the meanings set forth in ARTICLE 9.
AGREEMENT
NOW, THEREFORE, in consideration of the respective representations,
warranties and covenants contained herein and for other good and valuable
consideration, the receipt, adequacy and legal sufficiency of which are hereby
acknowledged, Buyer, Centerpost, Seller, Kilat and the Shareholders hereby agree
as follows:
ARTICLE 1
SALE OF ASSETS; ADDITIONAL AGREEMENTS; CLOSING
1.1 ACQUISITION. Subject to the terms and conditions of the Transaction
Agreements, at the Closing, Seller shall sell, transfer and deliver (a) to
Buyer, and Buyer shall purchase, all of Seller's right, title and interest in
and to the Intangible Assets and the Intellectual Property Assets and (b) to
Centerpost, and Centerpost shall purchase, all of Seller's right, title and
interest in and to the Tangible Assets (collectively, the "ACQUISITION").
1.2 ADDITIONAL UNDERSTANDINGS. In connection with the Acquisition, the
parties hereto agree as follows:
(a) Buyer and Centerpost will not, pursuant to this Agreement,
acquire any property of Seller other than the Assets except as specifically set
forth in this Agreement or the Intellectual Property Assets to be acquired by
Buyer from Seller pursuant to the terms of the Intellectual Property Purchase
Agreement; nor will Buyer or Centerpost assume or be bound by any contract or
agreement other than the Contracts and the Deed of Restraint of Trade (PROVIDED,
HOWEVER, that Buyer shall not assume any obligation of Seller thereunder); nor
will Buyer or Centerpost assume any other debt, claim, Liability, Tax, judgment
or obligation whatsoever of Seller except for those obligations under the
Contracts to be performed after the Closing Date. Except as set forth on
EXHIBIT B, neither Buyer nor Centerpost will recognize or assume any obligations
of Seller to employees of Seller or any collective bargaining agreements between
Seller and any labor organizations. Except as set forth on EXHIBIT B, neither
Buyer nor Centerpost will assume or be obligated to pay any debts, obligations,
responsibilities, Liabilities, claims, damages, judgments or settlements arising
from any such labor contracts or agreements or any other employment-related
matter involving Seller.
(b) In connection with the Acquisition, Seller, Kilat and each of the
Shareholders shall, from the date of this Agreement until the Closing Date,
afford the employees, auditors, legal counsel and other authorized
representatives of Buyer and Centerpost reasonable access to the properties,
records and personnel of Seller in order to inspect, investigate and audit the
Assets, the Intellectual Property Assets and the operations and business of
Seller. Buyer and Centerpost agree to conduct any such inspection,
investigation or audit in a reasonable manner, during regular business hours, so
as not to disrupt the normal functioning of Seller's business. Seller, Kilat
and the Shareholders agree to cooperate fully with Buyer and to make Seller's
books and records, the Assets, the Intellectual Property Assets and the
employees of Seller available to Buyer and Centerpost as reasonably required by
Buyer in order for Buyer to complete its due diligence in a timely fashion.
(c) The parties agree to allocate those portions of the Purchase
Price attributable to various components of the Assets for all purposes
(including accounting and tax purposes) in accordance with the allocation
schedule (the "ALLOCATION SCHEDULE") set forth on EXHIBIT C.
(d) Except as set forth on EXHIBIT B, neither Buyer nor Centerpost
will have any obligation for, and the parties specifically understand and
acknowledge that neither Buyer nor Centerpost will be assuming any
responsibility for or liability under any Employee Benefit Plan of Seller.
Except as set forth on EXHIBIT B, Buyer and Centerpost do not and shall not
recognize or assume any Liability with respect to any Employee Benefit Plan of
Seller, nor shall the inclusion by Buyer or Centerpost, or an Affiliate of Buyer
or Centerpost, of a former employee of Seller in an Employee Benefit Plan of
Buyer, Centerpost or an Affiliate of either, be deemed to constitute the
adoption or continuation by Buyer or Centerpost of any Employee Benefit Plan of
Seller except as set forth on EXHIBIT B.
(e) Seller, Kilat and the Shareholders covenant and agree that upon
Buyer's request they will do all acts and execute or cause Seller to execute all
such documents as are necessary to cause the name of Seller to be changed as of
the Closing Date to a name that does not include the words "Australian Software
Innovations" or the acronym "ASI" or any similar name and will on or before the
Closing Date deliver to Buyer appropriate signed notices to the Australian
Securities Commission having such effect and all other materials reasonably
requested by Buyer in connection therewith, together with all filing fees
payable in respect of lodging such notices. Seller, Kilat and the Shareholders
consent to Buyer causing a company controlled by Buyer or its Affiliates to
change its name to "Australian Software Innovations Pty. Ltd." on or after the
Closing Date.
(f) Pursuant to the Option Agreement, Buyer has elected to acquire,
as part of the Acquisition, the rights of Seller under the Contracts. In
connection with Buyer's acquisition of Seller's rights under the Contracts,
Buyer agrees to assume all of Seller's obligations under the Contracts which
arise on or after the Closing Date.
1.3 PURCHASE PRICE. The price to be paid by Buyer for the purchase of the
Assets (the "PURCHASE PRICE") shall be Seven Hundred Fifty Thousand Dollars
($750,000), which equals Eight Hundred Seventy-Two Thousand Dollars ($872,000)
less the amount of One Hundred Twenty-Two Thousand Dollars ($122,000), which
constitutes the Exercise Price Adjustment described in the Option Agreement.
1.4 PAYMENT OF PURCHASE PRICE. Payment of the Purchase Price shall be
made by Buyer and Centerpost to Seller as follows:
(a) Seller acknowledges the receipt of cash in the amount of One
Hundred Thirty Thousand Dollars ($130,000) (the "OPTION PURCHASE PAYMENT") paid
by Buyer in conjunction with the execution and delivery of the Option Agreement.
At the Closing, Seller shall credit the full amount of the Option Purchase
Payment against Buyer's payment of the Purchase Price.
(b) At the Closing, Centerpost shall pay to Seller One Hundred
Thousand Dollars ($100,000), in the form of cash, certified funds or wire
transferred funds, with the transfer of such funds to be initiated by Centerpost
within twenty-four hours of the Closing.
(c) At the Closing, Buyer shall pay to Seller One Hundred Seventy
Thousand Dollars ($170,000), in the form of cash, certified funds or wire
transferred funds, with the transfer of such funds to be initiated by Buyer
within twenty-four hours of the Closing.
(d) At the Closing, Buyer shall issue and deliver to Seller the Note
in the principal amount of Three Hundred Fifty Thousand Dollars ($350,000),
payable in seven monthly installments of $50,000 each.
1.5 CLOSING. Upon satisfaction or waiver of the conditions to Closing
contained in ARTICLE 4 and ARTICLE 5 hereof, the parties hereto agree to close
the Acquisition contemporaneously with the consummation of the transactions
described in the Intellectual Property Purchase Agreement and the Deed of
Restraint of Trade (the "CLOSING"). The Closing shall take place at the
principal offices of Buyer, or such other place as may be agreed to by the
parties, on the date agreed to by the parties, but in all events on or before
thirty (30) days from the date hereof. It is the intent of the parties to
consummate the Closing as soon as possible after the execution of this
Agreement. The parties agree to use their good faith and reasonable efforts to
close the Acquisition as soon as possible and to cooperate fully with each other
to complete the Closing.
1.6 CLOSING DELIVERIES.
(a) At the Closing, Seller shall deliver to Buyer (or to Centerpost
or both, respectively, as indicated):
(i) To Centerpost, the Tangible Assets, free and clear of all
Encumbrances except as expressly assumed by Centerpost and described on EXHIBIT
B;
(ii) To Buyer, the Intangible Assets, free and clear of all
Encumbrances except as expressly assumed by Buyer and described on EXHIBIT B;
(iii) An Assignment Agreement assigning to Buyer the
Contracts, free and clear of all Encumbrances except as expressly assumed by
Buyer and described on EXHIBIT B;
(iv) To Buyer or Centerpost, as the case may be, titles to all
titled properties constituting part of the Assets being transferred by Seller to
Buyer and Centerpost, such titles duly executed for transfer to Buyer or
Centerpost, respectively, free and clear of all Encumbrances except as expressly
assumed by Buyer and described on EXHIBIT B;
(v) Complete and accurate Disclosure Schedules;
(vi) To Centerpost, an executed services agreement, in form
acceptable to Centerpost in its discretion;
(vii) An executed Intellectual Property Purchase Agreement,
in form acceptable to Buyer in its discretion;
(viii) An executed Deed of Restraint of Trade, in form
acceptable to Buyer in its discretion;
(ix) To Centerpost and Buyer, such other documents, including
certificates of independent legal advice and appropriate statutory declarations,
as may be required by the Transaction Agreements, or the Intellectual Property
Purchase Agreement or reasonably requested by Buyer or Centerpost to carry out
the transactions contemplated hereby or thereby; and
(x) To Centerpost and Buyer according to the terms hereof,
possession of the Assets.
(b) At the Closing, Buyer shall deliver to Seller:
(i) The amount of One Hundred Seventy Thousand Dollars
($170,000) in the form of cash, certified funds or wire transferred funds, with
the transfer of such funds to be initiated by Buyer within twenty-four hours of
the Closing;
(ii) An executed Note, substantially in the form of EXHIBIT D,
acceptable to Buyer in its discretion;
(iii) An executed Intellectual Property Purchase Agreement,
in form acceptable to Buyer in its discretion;
(iv) An executed Deed of Restraint of Trade, in form acceptable
to Buyer in its discretion;
(v) An Assignment Agreement accepting assignment of all Seller's
rights under the Contracts and assuming the obligations arising under the
Contracts to be performed after the Closing Date; and
(vi) Such other documents, including officers' certificates, as
may be required by the Transaction Agreements, or as reasonably requested by
Seller to carry out the transactions contemplated hereby.
(c) At the Closing, Centerpost shall deliver to Seller:
(i) The amount of One Hundred Thousand Dollars ($100,000) in the
form of cash, certified funds or wire transferred funds, with the transfer of
such funds to be initiated by Buyer within twenty-four hours of the Closing;
(ii) An executed services agreement, in form acceptable to
Centerpost in its discretion; and
(iii) Such other documents, including officers' certificates,
as may be required by the Transaction Agreements, or as reasonably requested by
Seller to carry out the transactions contemplated hereby.
1.7 PAYMENT OF TAXES; STAMP DATA. Seller shall pay any and all Taxes
payable to Governmental Authorities of the Commonwealth of Australia or any
political subdivision thereof which are related in any manner to the grant and
exercise of the Option or the execution and performance of the Transaction
Agreements, including, without limitation, the full amount of any stamp duty
payable to Governmental Authorities of the Commonwealth of Australia or any
political subdivision thereof. Seller, Kilat and each of the Shareholders shall
jointly and severally indemnify, defend and hold harmless Buyer and Centerpost
from any and all Tax liabilities associated with the grant and exercise of the
Option and the execution and performance of the Transaction Agreements. To
facilitate Seller's performance of the obligations set forth in this SECTION
1.7, at the Closing Buyer and Centerpost shall withhold from the Purchase Price
an amount equal to Thirty-three Thousand One Hundred Seventy-Five and 50/100
Australian Dollars (AUS $33,175.50), representing the estimated amount of Taxes
payable in connection with the execution and performance of the Transaction
Agreements. The amount so withheld by Buyer and Centerpost shall be paid to
Xxxxxxx Xxxxxxx, Esq., counsel to Seller, to be held in trust by Xx. Xxxxxxx and
released solely for the purpose of fulfilling Seller s Tax obligations under the
terms of this SECTION 1.7.
ARTICLE 2
REPRESENTATIONS AND WARRANTIES OF SELLER,
KILAT AND THE SHAREHOLDERS
Except as otherwise indicated, Seller, Kilat and each of the Shareholders
jointly and severally represent and warrant to Buyer and Centerpost that the
following representations and warranties are true, correct and complete as of
the date of this Agreement and will be true, correct and complete as of the
Closing Date:
2.1 AUTHORITY. Seller, Kilat and each of the Shareholders have the
absolute and unrestricted right, power, authority and capacity to execute and
deliver the Transaction Agreements, as applicable, to perform his, her or its
obligations thereunder and to consummate the transactions contemplated thereby.
This Agreement has been, and each of the Transaction Agreements will be, when
executed, duly and validly executed and delivered by Seller, Kilat and each of
the Shareholders, and each of the Transaction Agreements, as applicable,
constitutes, or will, when executed, constitute, the legal, valid and binding
agreement of Seller, Kilat and each of the Shareholders, enforceable against
Seller, Kilat and each of the Shareholders in accordance with its terms except
as enforcement may be limited by applicable bankruptcy, insolvency,
reorganization, fraudulent conveyance, moratorium or other laws affecting
creditors' rights generally.
2.2 ORGANIZATION, EXISTENCE AND GOOD STANDING OF SELLER AND KILAT. Seller
is a limited company duly organized, validly existing and in good standing under
the laws of Australia and has full power and authority to carry on its business
as now being conducted, to own and operate its properties and assets, and to
perform all its obligations under the Transaction Agreements and the Contracts.
Kilat is a limited company duly organized, validly existing and in good standing
under the laws of Australia and has full power and authority to carry on its
business as now being conducted, to own and operate its properties and assets,
and to perform all its obligations under the Transaction Agreements.
2.3 CONSENTS AND APPROVALS; NO VIOLATION. Except as set forth in the
Disclosure Schedules, neither the execution and delivery of the Transaction
Agreements, the consummation of the transactions contemplated thereby, nor the
compliance by Seller and Kilat with any of the provisions thereof will, as of
the Closing Date, (i) conflict with or violate any provision of the Memorandum
and Articles of Association or other charter or governing documents of Seller or
Kilat, respectively, (ii) result in a violation or breach of, or constitute
(with or without due notice or lapse of time or both) a default (or give rise to
any right of termination, cancellation or acceleration) under, any of the terms,
conditions or provisions of any note, contract, agreement, commitment, bond,
mortgage, indenture, license, lease, pledge agreement or other instrument or
obligation to which Seller or Kilat is a party or by which Seller or Kilat or
any of their respective properties or assets may be bound, including, without
limitation, any other agreement with respect to the sale by Seller of any of its
properties or assets, (iii) to the best knowledge of Seller, Kilat and the
Shareholders, violate or conflict with any provision of any Legal Requirement
binding upon Seller or Kilat, or (iv) to the best knowledge of Seller, Kilat and
the Shareholders, result in, or require, the creation or imposition of, any
Encumbrance upon or with respect to any properties of Seller or Kilat,
including, without limitation, the Assets or the Intellectual Property Assets,
or impair the ability of Seller, Kilat or the Shareholders to carry out their
respective obligations under the Transaction Agreements.
2.4 BOOKS AND RECORDS. The books of account and other business records of
Seller regarding the Assets and the business and operations of Seller have all
been made available to Buyer and Centerpost and such books and records are
complete and correct with regard to the matters which are the subject of the
Transaction Agreements.
2.5 ABSENCE OF UNDISCLOSED LIABILITIES. Except as and to the extent fully
disclosed in writing to Buyer and Centerpost in the Disclosure Schedules, as of
the Closing Date, Seller will have no Liabilities, including, without
limitation, any Liabilities resulting from failure to comply with any Legal
Requirement applicable to Seller, its business or operations, the Assets or the
Intellectual Property Assets due or to become due and whether incurred in
respect of or measured by the income or sales of Seller for any period or
arising out of any transactions entered into, or any state of facts existing, on
or before the Closing Date which could, as of or after the Closing Date,
materially adversely affect Seller's business or operations, the Assets or the
Intellectual Property Assets, give rise to an Encumbrance against the Assets or
the Intellectual Property Assets or materially adversely affect Seller's ability
to carry out the transactions contemplated by the Transaction Agreements.
2.6 ABSENCE OF CHANGES. Between the date of this Agreement and the
Closing Date, there will not have been (i) any material adverse change, or any
event, condition or contingency that is likely to result in a material adverse
change in the condition of Seller's business or operations, the Assets or the
Intellectual Property Assets; (ii) any damage, destruction or loss, whether
covered by insurance or not, materially and adversely affecting Seller's
business or operations, the Assets or the Intellectual Property Assets; (iii)
any termination or receipt of notice of termination of one or more of the
Contracts; (iv) any dispute or any other occurrence, event or condition of any
character, which reasonably could be anticipated to give rise to a legal or
administrative action or to a material adverse change affecting the Assets or
the Intellectual Property Assets or Seller's ability to carry out its
obligations hereunder; or (v) any agreement to do any of the foregoing.
2.7 CONTRACTS. Except as set forth on the Disclosure Schedules or as
otherwise described in this Agreement:
(a) Complete and accurate copies, including all amendments, of the
Contracts have been delivered to Buyer.
(b) All of the Contracts are in full force and effect and are valid
and enforceable in accordance with their terms, there are no material defaults
thereunder or breaches thereof, and no condition exists or event has occurred
which, with notice or lapse of time or both, would constitute a default
thereunder.
(c) Seller has the right to assign its rights and obligations under
the Contracts to Buyer, and such assignment will not result in a default, breach
or right of termination thereunder.
(d) Set forth in the Disclosure Schedules is a complete and accurate
description of all obligations or commitments of Seller with respect to any
asset of any nature whatsoever that is used in whole or in part for the personal
use or benefit of any shareholder, officer, director or employee of Seller or
any Affiliate thereof.
2.8 PERSONAL PROPERTY.
(a) Except as set forth in the Disclosure Schedules, there is no
asset, property, right or interest of any nature whatsoever necessary to or
currently utilized in the operation of Seller's business which is not included
in the Assets or the Intellectual Property Assets and Buyer has been given,
pursuant to the Option, an opportunity to acquire all of such assets,
properties, rights and interests.
(b) Seller has made available to the Buyer true, correct and complete
copies of all material contracts, agreements, mortgages, leases and commitments
relating to or affecting any interest in the Assets or the Intellectual Property
Assets.
(c) Other than the Contracts, there are no agreements, whether verbal
or written, affecting any of the Assets or the Intellectual Property Assets
which have not been disclosed in writing to Buyer. Other than the Contracts or
as authorized by Buyer in writing prior to the Closing, all such agreements
affecting the Assets or the Intellectual Property Assets will be terminated
prior to or at the Closing.
2.9 TITLE TO ASSETS AND RELATED MATTERS. Seller owns all of the Assets
and Intellectual Property Assets free and clear of all Encumbrances and the
claims or rights of any other party. Seller has the power, authority and right
to sell the Assets and Intellectual Property Assets to Buyer and Centerpost free
and clear of any Encumbrances.
2.10 COMPLIANCE WITH LAWS. Seller is in compliance with all Legal
Requirements applicable to the ownership of the Assets and the Intellectual
Property Assets and the operation of its business where the failure so to comply
would have a material adverse effect on Seller's ability to carry out its
obligations under the Transaction Agreements, or the ability of Buyer and
Centerpost to carry on the business operations related to the Assets or the
Intellectual Property Assets after the Closing, and Seller does not have any
basis to expect, nor has it received, any Order, notice, or other communication
from any Governmental Authority of any alleged, actual, or potential violation
and/or failure to comply with any such Legal Requirement, except as disclosed on
the Disclosure Schedules.
2.11 LITIGATION. Except as set forth in the Disclosure Schedules, (i)
neither Seller, Kilat nor either of the Shareholders is subject to any Order in
which relief is sought involving, affecting, or relating to the ownership,
operation, or use of the Assets or the Intellectual Property Assets, the
operation of Seller's business or the matters covered by the Transaction
Agreements which would prevent, delay, or make illegal the transactions
contemplated by the Transaction Agreements, (ii) there are no Proceedings
pending or threatened against, involving, affecting, or relating to Seller,
Kilat or either of the Shareholders, the operation of Seller's business or to
Seller's ownership, operation or use of the Assets or the Intellectual Property
Assets before any arbitrator or Governmental Authority, and (iii) to the best
knowledge of Seller, Kilat and each of the Shareholders, there exist no facts to
serve as a basis for the institution of any Proceeding against Seller, Kilat,
either of the Shareholders or any of the Assets or Intellectual Property Assets
which would prohibit or adversely affect the Assets or the Intellectual Property
Assets or the ability of Seller, Kilat or the Shareholders to carry out their
respective obligations under the Transaction Agreements.
2.12 NO BROKER'S OR FINDER'S FEES. No agent, broker, investment banker or
similar Person has acted directly or indirectly on behalf of Seller in
connection with the Transaction Agreements or the transactions contemplated
hereby, and no Person, including Seller, Kilat or either of the Shareholders, is
or will be entitled to any broker's or finder's fee or any other commission or
similar fee or expense, directly or indirectly, in connection with the
Transaction Agreements or the transactions contemplated thereby.
2.13 BANKRUPTCY. Seller has not made any assignment for the benefit of
creditors, filed any petition in bankruptcy, been adjudicated insolvent or
bankrupt, petitioned or applied to any tribunal for any receiver, conservator or
trustee of it or any of its property or assets, or commenced any proceeding
under any reorganization arrangement, readjustment of debt, conservation,
dissolution or liquidation law or statute or any jurisdiction; and no such
action or proceeding has been commenced or threatened against Seller by any
creditor, claimant, Governmental Authority or any other person.
2.14 LABOR MATTERS. Except as set forth in the Disclosure Schedules,
(a) Seller has made all payments to its employees required by any
Legal Requirement or any Employee Benefit Plans;
(b) To the best knowledge of Seller, Kilat and each of the
Shareholders, there has not been, and there is not presently pending or
threatened, any Proceeding against Seller under any Legal Requirement governing
the conditions of Seller's employment of its employees, or any basis or ground
for any such claim;
(c) Seller has not been a party to any collective bargaining
agreement or other labor contract affecting the employees of Seller;
(d) To the best knowledge of Seller, Kilat and each of the
Shareholders, there has not been, and there is not presently pending or existing
or threatened, any strike, slowdown, picketing, work stoppage, labor arbitration
or proceeding in respect of the grievance of any employee, an application or
complaint filed by an employee or union with any Governmental Authority, or
organizational activity or labor dispute against or affecting the business of
Seller; and
(e) Seller has complied with all its obligations under all relevant
superannuation legislation and has made all contributions required to be made in
respect of its employees for their period of employment up to and including the
Closing Date. Seller has established reserves and accruals (each of which is
accurately set forth in the Disclosure Schedules) in amounts sufficient to
satisfy all superannuation obligations in respect of its employees for their
period of employment up to and including the Closing Date.
2.15 DISCLOSURE. No representation or warranty of Seller, Kilat or the
Shareholders contained in this Agreement, the Exhibits hereto, or any other
Transaction Agreement contains any untrue statement of a material fact or omits
to state a material fact necessary in order to make the statements herein or
therein, in light of the circumstances under which they were made, not
misleading. There is no fact known to Seller, Kilat or either of the
Shareholders which has specific application to Seller (other than general
economic or industry conditions) and which materially and adversely affects or,
so far as Seller, Kilat or either of the Shareholders can reasonably foresee,
materially threatens, the Assets, the Intellectual Property Assets or the
ability of Seller, Kilat or the Shareholders to carry out their respective
obligations under the Transaction Agreements, which has not been set forth in
this Agreement or in the Disclosure Schedules.
2.16 TAX MATTERS. With respect to Taxes, including, without limitation,
Taxes imposed by the Income Tax Assessment Act of 1936 of the Commonwealth of
Australia (the "TAX ACT") and any other Australian national, state or
territorial law or regulation:
(a) Seller has lodged, or will lodge, at or before the correct time all
Tax Returns required by law to be lodged on or before the Closing Date and all
such Tax Returns have been, or will be, as the case may be, fully and accurately
completed;
(b) Seller has made, to the Commissioner of Taxation or the appropriate
Governmental Authority a full and true disclosure of all material facts
necessary for the proper assessment of Seller and each deduction, rebate or
credit claimed in those Tax Returns has been properly claimed and is duly
allowable;
(c) All other necessary information, documents and notices in respect of
Tax have been properly and duly submitted by Seller to all relevant Governmental
Authorities in respect of Tax for all periods up to the Closing Date and will
continue to be properly and duly submitted up to the Closing Date and there is
no unresolved dispute with any of those authorities nor is any such dispute
foreshadowed or contemplated;
(d) All Taxes which have been assessed or imposed or are lawfully
assessable upon or are payable by Seller and which are due and payable or which
may become due and payable subsequent to but are referable to the period ending
on the Closing Date have been paid by Seller or adequate provisions has been
made for them in Seller's accounts and such provisions have been fully disclosed
to Buyer and Centerpost; and
(e) All obligations imposed on Seller under all laws relating to Tax have
been complied with and, without limiting the generality of the foregoing, all
amounts of income tax and medicare levy required by law to be deducted by Seller
from salary or wages of Seller's employees (including, without limitation,
Seller's directors and officers) and from prescribed payments and all amounts of
withholding tax have been duly deducted and where payable to the relevant taxing
authority have been duly paid.
2.17 INSURANCE. The assets of Seller (including, without limitation, the
Assets) are adequately insured by respect of the risks to which they are subject
(including loss or damage by disease, fire, theft, storm and tempest) in such
amounts as accord with sound business principles and such policies will not
expire earlier than the Closing Date. Seller is adequately insured against
public liability in such amounts as accord with sound business principles and
such policies will not expire prior to the Closing Date. Seller is adequately
insured against workers' compensation liability and has complied with all
respects with the legislation relating to workers' compensation in all
jurisdictions where relevant. All premiums in respect of the insurance coverage
referred to in this Agreement will have been paid prior to the Closing Date,
Seller has complied with all the conditions of the associated policies and has
not made any false or misleading statement or done or omitted to do anything
which would entitle the insurers to avoid the policies or refuse to meet any
claim thereunder in full other than as disclosed by Seller to Buyer and
Centerpost in writing prior to the Closing Date. There is no fact or matter of
which Seller, Kilat or the Shareholders is aware which could lead to Seller's
insurance policies being vitiated or repudiated and neither Seller, Kilat nor
the Shareholders will permit any such policies to lapse prior to the Closing
Date, nor will Seller, Kilat or the Shareholders do or fail to do anything which
will render any of Seller's insurance policies void or voidable prior to the
Closing Date.
2.18 TRADE PRACTICES. There is no agreement, arrangement or activity
whether by commission or omission in which Seller has been or will be concerned
which infringes or which has been or which is required to be authorized under
the Trade Practices Act of 1974 of the Commonwealth of Australia or any other
anti-trust legislation in relation to the Assets or the Intellectual Property
Assets, including, without limitation, any Australian national, state or
territorial law or regulation.
2.19 ENVIRONMENTAL LIABILITIES. There are no Environmental Liabilities (as
defined below) affecting any of Seller's business premises. There are no
factors affecting any of Seller's business premises which are likely within the
next twelve months to give rise to any Environmental Liability. For the
purposes of this clause, the term "ENVIRONMENTAL LAW" means any planning,
environmental, health, toxic, hazardous substances, dangerous goods,
waste/disposal or pollution laws, regulations, orders, notices, ordinances or
requirements, and the term "ENVIRONMENTAL LIABILITY" means any obligation,
expense, penalty or fine under an Environmental Law which could be imposed on
any occupier in possession of Seller's business premises.
ARTICLE 3
REPRESENTATIONS AND WARRANTIES OF BUYER AND CENTERPOST
Buyer and Centerpost represent and warrant to Seller, Kilat and the
Shareholders as follows, each to the extent the following relate to Buyer or
Centerpost, respectively:
3.1 ORGANIZATION, EXISTENCE AND GOOD STANDING. Buyer is a corporation
duly organized, validly existing and in good standing under the laws of the
State of Utah and has full power and authority to purchase the Intangible Assets
and the Intellectual Property Assets and to carry on its intended business
therewith. Centerpost is a limited company duly organized, validly existing and
in good standing under the laws of New South Wales, Australia and has full power
and authority to purchase the Tangible Assets and to carry on its intended
business therewith.
3.2 AUTHORITY. Each of Buyer and Centerpost has full power and authority
to execute and deliver the Transaction Agreements, to perform its obligations
thereunder and to consummate the transactions contemplated thereby. This
Agreement has been, and each of Transaction Agreements will be, when executed,
duly and validly executed and delivered by each of Buyer and Centerpost, and
each of the Transaction Agreements to which Buyer or Centerpost is a party
constitutes or will, when executed, constitute, the legal, valid and binding
agreement of Buyer and Centerpost, as applicable, enforceable against Buyer and
Centerpost in accordance with its terms, except as enforcement may be limited by
applicable bankruptcy, insolvency, reorganization, fraudulent conveyance,
moratorium or other laws affecting creditor's rights generally.
3.3 CONSENTS AND APPROVALS; NO VIOLATION. No filing or registration with,
no notice to and no Governmental Authorization, consent or approval of any
Governmental Authority, creditor or other person in a contractual relationship
with Buyer or Centerpost is necessary in connection with the execution and
delivery of the Transaction Agreements by Buyer or Centerpost, the performance
of their obligations hereunder or thereunder or the consummation of the
transactions contemplated hereby or thereby. Neither the execution and delivery
of the Transaction Agreements, the consummation of the transactions contemplated
thereby, nor the compliance by Buyer or Centerpost with any of the provisions
thereof will, as of the Closing Date, (i) result in a violation or breach of, or
constitute (with or without due notice or lapse of time or both) a default (or
give rise to any right of termination, cancellation or acceleration) under, any
of the terms, conditions or provisions of the Articles of Incorporation, Bylaws
or other charter documents of Buyer and Centerpost, or of any note, contract,
agreement, commitment, bond, mortgage, indenture, license, lease, pledge
agreement or other instrument or obligation to which Buyer or Centerpost is a
party or by which Buyer, Centerpost or any of their properties or assets may be
bound, or (ii) violate or conflict with any provision of any Legal Requirement
binding upon Buyer or Centerpost.
3.4 BANKRUPTCY. Neither Buyer nor Centerpost has made any assignment for
the benefit of creditors, filed any petition in bankruptcy, been adjudicated
insolvent or bankrupt, petitioned or applied to any tribunal for any receiver,
conservator or trustee of it or any of its property or assets, or commenced any
proceeding under any reorganization arrangement, readjustment of debt,
conservation, dissolution or liquidation law or statute or any jurisdiction; and
no such action or proceeding has been commenced or threatened against Buyer or
Centerpost by any creditor, claimant, governmental authority or any other
person.
3.5 NO BROKER'S OR FINDER'S FEES. No agent, broker, investment banker or
similar Person has acted directly or indirectly on behalf of Buyer or Centerpost
in connection with the Transaction Agreements or the transactions contemplated
thereby, and no Person, including Buyer or Centerpost, is or will be entitled to
any broker's or finder's fee or any other commission or similar fee or expense,
directly or indirectly, in connection with the Transaction Agreements or the
transactions contemplated thereby.
ARTICLE 4
CONDITIONS PRECEDENT
TO THE OBLIGATIONS OF BUYER AND CENTERPOST
The obligations of Buyer and Centerpost to consummate the transactions
contemplated by the Transaction Agreements at the Closing are subject to
fulfillment of the following conditions, any one or more of which may be waived
in whole or in part by Buyer and Centerpost in the manner provided for herein.
4.1 REPRESENTATIONS AND WARRANTIES TRUE AT CLOSING. The representations
and warranties of Seller, Kilat and the Shareholders contained in the
Transaction Agreements, including the Exhibits thereto, are true, correct and
complete in all material respects as of the Closing Date.
4.2 PERFORMANCE; COMPLIANCE WITH AGREEMENT. Seller, Kilat and each of the
Shareholders shall have performed and complied with all obligations, agreements,
covenants and conditions required by the Transaction Agreements to be performed
or complied with by them on or before the Closing Date, including without
limitation making all the deliveries required by SECTION 1.6.
4.3 AUTHORIZATION; THIRD-PARTY CONSENTS. All filings and registrations
with and notices to, and each Governmental Authorization, consent or approval
of, any Governmental Authority, creditor or other Person which is necessary in
connection with the execution and delivery of the Transaction Agreements by
Seller, Kilat and the Shareholders, the performance of their respective
obligations hereunder and thereunder, or the consummation of the transactions
contemplated hereby and thereby shall have been made or obtained. All corporate
actions necessary to authorize the execution, delivery and performance of the
Transaction Agreements by Seller and Kilat, and the consummation by Seller and
Kilat of the transactions contemplated by the Transaction Agreements shall have
been duly and validly taken, and Seller and Kilat shall have full right and
power to sell the Assets and the Intellectual Property Assets and to perform
their respective obligations upon the terms provided in the Transaction
Agreements. On or prior to the Closing Date, Seller, Kilat and the Shareholders
shall have furnished to the Buyer and Centerpost evidence of the foregoing
filings, notices, consents, stipulations and assignments.
4.4 NO MATERIAL ADVERSE CHANGE. During the period from the date of this
Agreement through the Closing Date, there shall not have been any material
adverse change in the Assets or the Intellectual Property Assets, and none of
the events described in SECTION 2.6 shall have occurred.
4.5 COMPLETION OF INVESTIGATION. Buyer and Centerpost shall have
completed, to their sole satisfaction and at their expense, an investigation
into the condition of the Assets and the Intellectual Property Assets and the
business and operations of Seller. If Buyer or Centerpost is not satisfied with
any matter revealed during its investigation, or with any matter set forth on
the Disclosure Schedules, Buyer or Centerpost shall have the right to terminate
this Agreement if notice of termination is given to the Seller, Kilat and the
Shareholders prior to the Closing.
4.6 GOOD TITLE TO BUYER AND CENTERPOST. Seller shall have conveyed the
Assets and the Intellectual Property Assets to Buyer and Centerpost, free and
clear of all Encumbrances.
4.7 ACTIONS SATISFACTORY. The form and substance of all actions,
proceedings, instruments and documents required to consummate the transactions
contemplated by the Transaction Agreements shall have been satisfactory in all
reasonable respects to Buyer, Centerpost and their counsel.
ARTICLE 5
CONDITIONS PRECEDENT TO THE
OBLIGATIONS OF SELLER, KILAT AND THE SHAREHOLDERS
The obligations of Seller, Kilat and the Shareholders to consummate the
transactions contemplated by the Transaction Agreements at the Closing are
subject to the fulfillment of the following conditions, any one or more of which
may be waived in whole or in part by Seller, Kilat or the Shareholders in the
manner provided for herein.
5.1 REPRESENTATIONS AND WARRANTIES TRUE AT CLOSING. The representations
and warranties of Buyer and Centerpost contained in the Transaction Agreements
shall be true, correct and complete in all material respects as of the Closing
Date.
5.2 PERFORMANCE OF BUYER AND CENTERPOST; COMPLIANCE WITH AGREEMENT. Buyer
shall have performed and complied with all obligations, agreements, covenants
and conditions required by the Transaction Agreements to be performed or
complied with by Buyer and Centerpost on or before the Closing Date, including
without limitation making all the deliveries required by SECTION 1.6.
5.3 AUTHORIZATION; THIRD PARTY CONSENTS. All filings and registrations
with and notices to, and each Governmental Authorization, consent or approval
of, any Governmental Authority, creditor or other Person which is necessary in
connection with the execution and delivery of the Transaction Agreements by
Buyer and Centerpost, the performance of its obligations thereunder, or the
consummation of the transactions contemplated thereby shall have been made or
obtained. All corporate action necessary to authorize the execution, delivery
and performance the Transaction Agreements by Buyer and Centerpost and the
consummation by Buyer and Centerpost of the transactions contemplated by the
Transaction Agreements shall have been duly and validly taken, and Buyer and
Centerpost shall have full right and power to purchase the Assets and the
Intellectual Property Assets and to perform their obligations upon the terms
provided in the Transaction Agreements. Buyer and Centerpost shall have
furnished to Seller, Kilat and the Shareholders evidence of the foregoing
consents and actions, if requested.
5.4 NO MATERIAL ADVERSE CHANGE. Between the date of this Agreement and
the Closing Date, there will not have been any material adverse change, or any
event, condition or contingency that results in a material adverse change
affecting the ability of Buyer or Centerpost to carry out its obligations under
the Transaction Agreements.
5.5 ACTIONS SATISFACTORY. The form and substance of all actions,
proceedings, instruments and documents required to consummate the transactions
contemplated by the Transaction Agreements shall have been satisfactory in all
reasonable respects to Seller, Kilat and the Shareholders and their counsel.
ARTICLE 6
ADDITIONAL COVENANTS AND AGREEMENTS
6.1 EXPENSES. Except as otherwise expressly provided herein, each party
to this Agreement shall bear its respective expenses incurred in connection with
the preparation, execution and performance of the Transaction Agreements and the
transactions contemplated hereby, including without limitation all fees and
expenses of agents, business brokers, legal counsel, accountants, tax and
financial advisors and other facilitators and advisors.
6.2 CONFIDENTIALITY.
(a) NON-DISCLOSURE AND USE. Each of Buyer, Centerpost, Seller, Kilat
and the Shareholders acknowledges that, in connection with the transactions
contemplated by the Option Agreement and the Transaction Agreements, each has
become or may become privy to the technical, marketing and other proprietary
information of another party, including, without limitation, information,
material, documents and data related to such other party, to the business
activities of such other party and/or to its customers, trade secrets and other
proprietary information (collectively, the "PROPRIETARY INFORMATION"). Each
agrees (i) to take at all times all reasonably necessary steps to safeguard the
confidentiality of any Proprietary Information; (ii) not to disclose, reveal,
make accessible or make available to any third Person any Proprietary
Information; and (iii) not to use any Proprietary Information for such party's
own benefit or for any other Person's benefit; PROVIDED, HOWEVER, that Buyer,
Centerpost, Seller, Kilat or the Shareholders may disclose (A) Proprietary
Information which at the time of the disclosure is part of the public knowledge
and readily accessible to such third party, (B) Proprietary Information which is
required by law to be disclosed, and (C) Proprietary Information required to be
disclosed to BMC by the terms of the BMC Agreement.
(b) RETURN. Buyer, Centerpost, Seller, Kilat and the Shareholders
agree that if the Acquisition is not consummated, each of them will return to
the other parties hereto any and all material containing or reflecting
Proprietary Information.
(c) REMEDIES. Each of Buyer, Centerpost, Seller, Kilat and the
Shareholders acknowledges and agrees that any breach of the terms of this
SECTION 6.2 would result in irreparable injury and damage to the injured party
for which such party would have no adequate remedy at law; each of Buyer,
Centerpost, Seller, Kilat and the Shareholders therefore also acknowledges and
agrees that in the event of such breach or any threat of breach, the injured or
threatened party shall be entitled, in addition to any other remedies to which
such party may be entitled at law or in equity, to an immediate injunction and
restraining order to prevent such breach and/or threatened breach by the
breaching or threatening party and/or any and all persons and/or entities acting
for and/or with such breaching or threatening party, without having to provide a
bond or other security or to prove actual damages.
6.3 OPERATION OF BUSINESS. Except pursuant to or in connection with the
BMC Agreement, neither Seller, Kilat nor either of the Shareholders will engage
in any practice, take any action or enter into any transaction outside the
Ordinary Course of Business with respect to the Assets, the Intellectual
Property Assets or the operation of Seller's business from the date of this
Agreement until the Closing Date without the prior written consent of Buyer and
Centerpost. Without in any manner limiting the foregoing, Seller, Kilat and the
Shareholders covenant and agree that during such period,
(i) The aggregate monthly remuneration (including, without
limitation, all salary, distributions, dividends, bonuses, deferred
compensation, automobile lease expense, superannuation payments and other
payments) paid to or for the benefit of Kilat and the Shareholders and all
Affiliates of Kilat and the Shareholders shall not exceed Sixteen Thousand
Six Hundred Sixty Seven Australian Dollars (AUS $16,667), and
(ii) Except as set forth in the Disclosure Schedules, Seller will
not, and Kilat and the Shareholders will not permit Seller to, make any
payment or incur any obligation with respect to any asset of any nature
whatsoever that is used in whole or in part for the personal use or benefit
of any shareholder, officer, director or employee of Seller or any
Affiliate thereof.
Seller, Kilat and the Shareholders will use their best commercially reasonable
efforts to preserve the Assets, the Intellectual Property Assets and the
goodwill and value of Seller's business, to comply with all laws applicable to
the Assets, the Intellectual Property Assets and Seller's business and to
maintain good working relationships with lessors, licensors, suppliers,
customers and employees. In addition, Seller will not sell or contract to sell
any interest in Seller or lease, license, transfer, pledge, mortgage,
hypothecate or otherwise dispose of any of the Assets or the Intellectual
Property Assets and Kilat and the Shareholders will not permit Seller to take
any such action, except as expressly required by the BMC Agreement. Seller will
not, and Kilat and the Shareholders will not permit Seller to, do any act or
thing or suffer or permit any omission which would make any policy of insurance
of Seller written with respect to the Assets or the Intellectual Property Assets
void or voidable or do anything that would mean that any existing insurance
policy of Seller is not materially in full force and effect at all times prior
to the Closing Date.
6.4 PUBLICITY. The parties hereto agree, subject to the provisions of
SECTION 6.2, to advise and confer with each other, to the maximum extent
possible, regarding and prior to the issuance of any reports, statements,
releases, public announcements or similar publicity with respect to this
Agreement or the transactions contemplated hereby; PROVIDED, HOWEVER, that any
of the parties may make such announcements, give such notices and provide such
information to Governmental Authorities, employees, creditors, affiliates and
the public as its counsel may advise is legally required.
6.5 EXCLUSIVITY. From and after the date of this Agreement until the
Closing:
(a) Except for dealings with BMC pursuant to the express terms of the
BMC Agreement, neither Seller nor any of its officers, directors, stockholders
or agents (including, without limitation, Kilat and the Shareholders) shall
directly or indirectly:
(i) Enter into any transaction with any party other than Buyer
or Centerpost relative to any disposition of the Assets, the Intellectual
Property Assets or Seller's business or operations or any part thereof; or
(ii) Solicit or encourage submission of inquiries, proposals or
offers from any other party relative to potential disposition of the Assets, the
Intellectual Property Assets or Seller's business or operations or any part
thereof; or
(iii) Provide further information to any party other than
Buyer or Centerpost relating to any possible disposition of the Assets, the
Intellectual Property Assets or Seller's business or operations or any part
thereof.
(b) Seller, Kilat and the Shareholders agree that if Seller, Kilat or
either of the Shareholders receives an offer or proposal (other than the BMC
Agreement) relating to the possible disposition of the Assets, the Intellectual
Property Assets or Seller's business or operations or any part thereof, Seller,
Kilat and the Shareholders will immediately notify Buyer of such offer or
proposal, the identity of the party making the offer or proposal and the
specific terms of the offer or proposal.
6.6 COOPERATION. Kilat and each of the Shareholders agrees to cause
Seller to take, or to refrain from taking, all actions necessary to fulfill
Seller's covenants and obligations under the Transaction Agreements.
ARTICLE 7
INDEMNIFICATION AND LIMITATION
7.1 INDEMNIFICATION BY SELLER AND THE SHAREHOLDERS. Subject to the
limitations set forth in SECTION 7.4, Seller, Kilat and each of the
Shareholders, jointly and severally, unconditionally, absolutely and irrevocably
agree to and shall defend, indemnify and hold harmless Buyer, Centerpost, and
each of the officers, directors, employees, counsel, successors, assigns, and
legal representatives of Buyer and Centerpost (Buyer, Centerpost and such
persons are collectively referred to as the "BUYER'S INDEMNIFIED PERSONS") from
and against, and shall reimburse Buyer's Indemnified Persons for, each and every
Loss paid, imposed on or incurred by Buyer's Indemnified Persons, directly or
indirectly, relating to, resulting from or arising out of any inaccuracy in any
representation or warranty of Seller, Kilat or the Shareholders under the Option
Agreement, the Transaction Agreements or the Exhibits thereto or any agreement,
certificate or document delivered by Seller, Kilat or the Shareholders pursuant
hereto in any respect, or any breach or nonfulfillment of any covenant,
agreement or other obligation of Seller, Kilat or the Shareholders under the
Option Agreement, the Transaction Agreements or the Exhibits thereto or any
agreement, certificate or document to be delivered by Seller, Kilat or the
Shareholders pursuant hereto (including, without limitation, Seller s obligation
to pay Taxes pursuant to SECTION 1.7). With respect to matters not involving
Proceedings brought or asserted by third parties against Buyer's Indemnified
Persons, within thirty (30) days after notification from Buyer's Indemnified
Persons supported by reasonable documentation setting forth the nature of the
circumstances entitling Buyer's Indemnified Persons to indemnity hereunder,
Seller, Kilat and the Shareholders shall, at no cost or expense to Buyer's
Indemnified Persons, diligently commence resolution of such matters in a manner
reasonably acceptable to Buyer's Indemnified Persons and shall diligently and
timely prosecute such resolution to completion; PROVIDED, HOWEVER, with respect
to those valid claims that may be satisfied by payment of a liquidated sum of
money and which are not disputed reasonably and in good faith by Seller, Kilat
and the Shareholders, Seller, Kilat and the Shareholders shall promptly pay the
amount so claimed. If litigation or any other Proceeding is commenced or
threatened, the provisions of SECTION 7.3 shall control over the immediately
preceding sentence. Buyer and Centerpost shall be entitled to offset against
any amounts owed by Buyer or Centerpost, as the case may be, to Seller, Kilat or
the Shareholders under any Transaction Agreement any amounts owed by Seller,
Kilat or the Shareholders, respectively, to Buyer or Centerpost hereunder.
7.2 INDEMNIFICATION BY BUYER AND CENTERPOST. Each of Buyer and Centerpost
unconditionally, absolutely and irrevocably agrees to and shall defend,
indemnify and hold harmless Seller, Kilat, the Shareholders and the successors,
assigns, heirs and legal and personal representatives of Seller, Kilat and the
Shareholders (Seller, Kilat, the Shareholders and such persons are collectively
referred to as the "SELLER'S INDEMNIFIED PERSONS") from and against, and shall
reimburse Seller's Indemnified Persons for, each and every Loss paid, imposed on
or incurred by Seller's Indemnified Persons, directly or indirectly, relating
to, resulting from or arising out of any inaccuracy in any representation or
warranty of Buyer or Centerpost under the Option Agreement, the Transaction
Agreements or the Exhibits thereto or any agreement, certificate or other
document delivered or to be delivered by Buyer or Centerpost pursuant hereto in
any respect, or any breach or nonfulfillment of any covenant, agreement or other
obligation of Buyer or Centerpost under the Option Agreement, the Transaction
Agreements, the Exhibits thereto or any agreement, certificate or document to be
delivered by Buyer or Centerpost pursuant hereto. With respect to matters not
involving Proceedings brought or asserted by third parties against Seller's
Indemnified Persons, within thirty (30) days after notification from Seller's
Indemnified Persons supported by reasonable documentation setting forth the
nature of the circumstances entitling Seller's Indemnified Persons to indemnity
hereunder, the Buyer or Centerpost, at no cost or expense to Seller's
Indemnified Persons, shall diligently commence resolution of such matters in a
manner reasonably acceptable to Seller's Indemnified Persons and shall
diligently and timely prosecute such resolution to completion; PROVIDED,
HOWEVER, with respect to those valid claims that may be satisfied by payment of
a liquidated sum of money and which are not disputed reasonably and in good
faith by Buyer or Centerpost, Buyer or Centerpost shall promptly pay the amount
so claimed. If litigation or any other Proceeding is commenced or threatened,
the provisions of SECTION 7.3 shall control over the immediately preceding
sentence.
7.3 NOTICE AND DEFENSE OF THIRD-PARTY CLAIMS. If any Proceeding shall be
brought or asserted against a party entitled to indemnification pursuant to
SECTIONS 7.1 or 7.2, or any successor thereto (the "INDEMNIFIED PERSON") in
respect of which indemnity may be sought under this Article from an indemnifying
person or any successor thereto (the "INDEMNIFYING PERSON"), the Indemnified
Person shall give prompt written notice of such Proceeding to the Indemnifying
Person who shall assume the defense thereof, including the employment of counsel
reasonably satisfactory to the Indemnified Person and the payment of all
expenses; provided, that any delay or failure to so notify the Indemnifying
Person shall relieve the Indemnifying Person of its obligations hereunder only
to the extent, if at all, that it is prejudiced by reason of such delay or
failure. In no event shall any Indemnified Person be required to make any
expenditure or bring any cause of action to enforce the Indemnifying Person's
obligations and liability under and pursuant to the indemnification obligations
set forth in this Article. In addition, actual or threatened action by a
Governmental Authority or other Person is not a condition or prerequisite to the
Indemnifying Person's obligations under this Article. The Indemnified Person
shall have the right to employ separate counsel in any of the foregoing
Proceedings and to participate in the defense thereof, but the reasonable fees
and expenses of such counsel shall be at the expense of the Indemnified Person
unless the Indemnified Person shall in good faith determine that there exist
actual or potential conflicts of interest which make representation by the same
counsel inappropriate. The Indemnified Person's right to participate in the
defense or response to any Proceeding should not be deemed to limit or otherwise
modify its rights and obligations under this Article. In the event that the
Indemnifying Person, within fifteen (15) days after notice of any such
Proceeding, fails to assume the defense thereof, the Indemnified Person shall
have the right to undertake the defense, compromise or settlement of such
Proceeding for the account of the Indemnifying Person, subject to the right of
the Indemnifying Person to assume the defense of such Proceeding with counsel
reasonably satisfactory to the Indemnified Person at any time prior to the
settlement, compromise or final determination thereof. If the Indemnifying
Person assumes the defense of any Proceeding, the Indemnified Person shall,
reasonably and in good faith, assist and cooperate in the defense thereof.
Anything in this Article to the contrary notwithstanding, the Indemnifying
Person shall not, without the Indemnified Person's prior written consent, settle
or compromise any Proceeding or consent to the entry of any judgment with
respect to any Proceeding for anything other than money damages paid by the
Indemnifying Person. The Indemnifying Person may, without the Indemnified
Person's prior written consent, settle or compromise any such Proceeding or
consent to entry of any judgment with respect to any such Proceeding that
requires solely the payment of money damages by the Indemnifying Person and that
includes as an unconditional term thereof the release by the claimant or the
plaintiff of the Indemnified Person from all liability in respect of such
Proceeding.
7.4 LIMITATION OF LIABILITY. Notwithstanding the foregoing provisions of
this ARTICLE 7, each of Buyer and Centerpost agrees that the maximum monetary
amount for which the Shareholders shall be liable to Buyer's Indemnified Persons
in connection with the provisions of the Transaction Agreements, shall be
limited to the aggregate amount of One Million Eight Hundred Thousand Dollars
($1,800,000); PROVIDED, HOWEVER, that the foregoing limitation on the liability
of the Shareholders shall not apply to, and each of the Shareholders shall be
jointly and severally liable to Buyer's Indemnified Persons, and any of them,
for the aggregate amount of actual damages resulting from:
(a) any representation made by Seller, Kilat or either of the
Shareholders which any of Seller, Kilat or either of the Shareholders knows or
has reason to know is false or misleading at the Closing Date, or
(b) any fraudulent conduct of Seller, Kilat or either of the
Shareholders.
Furthermore, each of Seller, Kilat and the Shareholders acknowledges and agrees
that the foregoing limitation of liability shall not in any manner limit the
liability of Seller and Kilat for any reason whatsoever.
7.5 GUARANTEE.
(a) Kilat and each of the Shareholders gives the indemnity set forth
in SECTION 7.1 and the guarantee set forth in this SECTION 7.5 in consideration
of the agreement of Buyer and Centerpost to enter into the Transaction
Agreements. Kilat and each of the Shareholders acknowledges the receipt of
valuable consideration from Buyer and Centerpost for the agreement of Kilat and
the Shareholders to incur obligations and give rights under such indemnity and
guarantee.
(b) Kilat and each of the Shareholders unconditionally and
irrevocably guarantees to Buyer and Centerpost the due and punctual performance
and observance by Seller of its obligations under the Transaction Agreements
including, without limitation, any obligation to pay money.
(c) Kilat and each of the Shareholders waive any right it, he or she
have of first requiring Buyer or Centerpost to commence proceedings or enforce
any other right against Seller or any other person before claiming under such
indemnity and guarantee.
(d) This guarantee and the foregoing indemnity are continuing
security obligations and are not discharged by any one payment. Such guarantee
and indemnity do not merge on completion.
(e) The liabilities of Kilat and each of the Shareholders under such
guarantee and indemnity are as a guarantor, indemnifier and principal debtor and
the rights of Buyer and Centerpost under such guarantee and indemnity are not
affect by anything which might otherwise affect them at law or in equity
including, but not limited, one or more of the following:
(i) Buyer or Centerpost granting time or other indulgence to,
compounding or compromising with or releasing Seller, or any other
guarantor;
(ii) acquiescence, delay, acts, omissions or mistakes on the part
of Buyer or Centerpost;
(iii) any novation of a right of Buyer or Centerpost;
(iv) any variation of the Transaction Agreements, or any
agreement entered into in performance thereof; or
(v) the invalidity or unenforceability of an obligation or
liability of a person other than the relevant guarantor (being Kilat or one
of the Shareholders).
(f) Kilat and each of the Shareholders may not, without the consent
of Buyer and/or Centerpost, as the case may be:
(i) raise a set-off or counterclaim available to it or Seller
against Buyer or Centerpost in reduction of it's liability under such
guarantee and indemnity;
(ii) claim to be entitled by way of contribution, indemnity,
subrogation, marshaling or otherwise to the benefit of any security or
guarantee held by Buyer or Centerpost in connection with the Transaction
Agreements; or
(iii) prove in competition with Buyer or Centerpost, if a
liquidator, provisional liquidator, receiver, official manager or trustee
in bankruptcy is appointed in respect of Seller or Seller is otherwise
unable to pay its debts when they fall due, until all money payable to
Buyer or Centerpost in connection with the Transaction Agreements is paid.
(g) If a claim that a payment or transfer to Buyer or Centerpost in
connection with the Transaction Agreements is void or voidable (including, but
not limited to, a claim under laws relating to liquidation, insolvency or
protection of creditors) is upheld, conceded or compromised, then Buyer or
Centerpost, as the case may be, is entitled immediately as against Kilat and
each Shareholder to the rights to which it would have been entitled under such
guarantee and indemnity if the payment or transfer had not occurred.
(h) Kilat and each of the Shareholders agree to pay or reimburse each
of Buyer and Centerpost on demand for its costs, charges and expenses in making,
enforcing and doing anything in connection with such guarantee and indemnity
including, without limitation, legal costs and expenses on a full indemnity
basis. Any amounts paid to Buyer or Centerpost by Kilat or one of the
Shareholders must be applied first against payment of costs, charges and
expenses under this SECTION 7.5(H), then against other obligations under such
guarantee and indemnity.
(i) Kilat and each of the Shareholders acknowledges having been given
a copy of this Agreement and having had full opportunity to consider its
provisions before entering into such guarantee and indemnity.
ARTICLE 8
MISCELLANEOUS
8.1 SURVIVAL OF REPRESENTATIONS, WARRANTIES, COVENANTS AND AGREEMENTS.
Notwithstanding any investigation made at any time by or on behalf of the
parties hereto, all of the representations and warranties of the parties shall
survive the Closing of the transactions contemplated by the Transaction
Agreements (even if the other party knew or had reason to know of any
misrepresentation or breach of any warranty at the time of the Closing) and all
of the covenants of the parties shall survive the Closing, including but not
limited to the obligations of the parties set forth in SECTION 6.2 and the
indemnification obligations of the parties hereto. In addition, the covenants
and obligations set forth in SECTION 6.2 shall survive the termination of this
Agreement.
8.2 AMENDMENT AND MODIFICATION. This Agreement may be amended, modified,
terminated, rescinded or supplemented only by written agreement of the parties
hereto.
8.3 WAIVER; CONSENTS. The rights and remedies of the parties to this
Agreement are cumulative and not alternative. Any failure of a party to comply
with any obligation, covenant, agreement or condition herein may be waived by
each party affected thereby only by a written instrument signed by the party
granting such waiver. No waiver, or failure to insist upon strict compliance,
by any party of any condition or any breach of any obligation, term, covenant,
representation, warranty or agreement contained in this Agreement, in any one or
more instances, shall be construed to be a waiver of, or estoppel with respect
to, any other condition or any other breach of the same or any other obligation,
term, covenant, representation, warranty or agreement. Whenever this Agreement
requires or permits consent by or on behalf of any party hereto, such consent
shall be given in writing in a manner consistent with the requirements for a
waiver.
8.4 FURTHER ASSURANCES; COOPERATION. The parties hereto agree (I) to
furnish upon request to each other such further information, (ii) to execute and
deliver to each other such other documents, and (iii) to do such other acts and
things, all as another party hereto may at any time reasonably request,
including before, at and after the Closing, for the purpose of carrying out the
intent of the Transaction Agreements and the documents referred to therein.
8.5 NOTICES. All notices and other communications hereunder shall be in
writing and shall be deemed to have been duly given when (I) delivered
personally, (ii) sent by telecopier (with receipt confirmed), or (iii) received
by the addressee, if sent by Express Mail, Federal Express or other express
delivery service (receipt requested) or (iv) three business days after being
sent by registered or certified mail, return receipt requested, in each case to
the other party at the following addresses and telecopier numbers (or to such
other address or telecopier number for a party as shall be specified by like
notice; provided that notices of a change of address or telecopier number shall
be effective only upon receipt thereof):
if to Seller, to:
Australian Software Innovations (Services) Pty Ltd
00 Xxxxxx Xxxxxx, Xxxxx 000
Xxxxxx XXX 0000
Attn: Eng Xxx, Managing Director
Telecopier: 00-0-000-0000
if to Kilat or the Shareholders, to:
Eng Xxx
00 Xxxxxx Xxxxxx, Xxxxx 000
Xxxxxx XXX 0000
Telecopier: 00-0-000-0000
if to Buyer, to:
Sento Technical Innovations Corporation
000 Xxxxx Xxxxx Xxxxxx
Xxxx, Xxxx 00000
Attn: Xxxxxx X. Bench, President
Telecopier: (000) 000-0000
with copies to:
Xxxxx X. Xxxxx
Xxxxxxx, Parr, Waddoups, Xxxxx & Gee
000 Xxxxx Xxxxx Xxxxxx, Xxxxx 0000
Xxxx Xxxx Xxxx, Xxxx 00000
Telecopier: (000) 000-0000
if to Centerpost, to:
Centerpost Innovations Pty. Ltd.
c/o Sento Technical Innovations Corporation
000 Xxxxx Xxxxx Xxxxxx
Xxxx, Xxxx 00000
Attn: Xxxxxx X. Bench, President
Telecopier: (000) 000-0000
with copies to:
Xxxxx X. Xxxxx
Xxxxxxx, Parr, Waddoups, Xxxxx & Gee
000 Xxxxx Xxxxx Xxxxxx, Xxxxx 0000
Xxxx Xxxx Xxxx, Xxxx 00000
Telecopier: (000) 000-0000
8.6 ASSIGNMENT. This Agreement and all of the provisions hereof shall be
binding upon and inure to the benefit of the parties hereto and their respective
heirs, personal representatives, successors and permitted assigns. Buyer or
Centerpost may, in its discretion, assign its rights, interests and obligations
hereunder to any Person without the prior consent of any other party hereto.
Neither Seller, Kilat nor either of the Shareholders may assign any of their
respective rights, interests or obligations hereunder without the prior written
consent of Buyer and Centerpost. This Agreement is not intended to and shall
not confer upon any person other than the parties any rights or remedies
hereunder or with respect hereto.
8.7 GOVERNING LAW. This Agreement shall be governed by and construed in
accordance with the laws of New South Wales, Australia applicable to contracts
made and to be performed wholly therein.
8.8 COUNTERPARTS. This Agreement may be executed in one or more
counterparts, each of which shall be deemed an original, but all of which
together shall constitute one and the same agreement.
8.9 INTERPRETATION. The article and section headings contained in this
Agreement are solely for the purpose of reference, are not part of the agreement
of the parties and shall not in any way affect the meaning or interpretation of
this Agreement. Unless otherwise provided, all references in this Agreement to
articles and sections refer to the corresponding articles and sections of this
Agreement. All words used herein shall be construed to be of such gender or
number as the circumstances require. Unless otherwise specifically noted, the
words "herein," "hereof," "hereby," "hereinabove," "hereinbelow," "hereunder,"
and words of similar import, refer to this Agreement as a whole and not to any
particular article, section, clause or other subdivision hereof. Whenever the
term "including" or a similar term is used in this Agreement, it shall be read
as if it were written "including by way of example only and without in any way
limiting the generality of the clause or concept to which reference is made."
This Agreement shall be construed as though all parties had drafted it.
8.10 ENTIRE AGREEMENT. This Agreement and the Transaction Agreements,
including the Exhibits and the documents, instruments and schedules referred to
herein and therein, embodies the entire agreement and understanding of the
parties hereto in respect of the subject matter contained herein. There are no
restrictions, promises, representations, warranties, covenants, or undertakings
other than those expressly set forth or referred to herein and in the
Transaction Agreements. The Transaction Agreements supersede all prior
agreements and understandings between the parties with respect to such subject
matter.
8.11 ATTORNEYS' FEES. In the event a Proceeding is brought by any party
under this Agreement to enforce or construe any of its terms, the party that
prevails by enforcing this Agreement shall be entitled to recover, in addition
to all other amounts and relief, its reasonable costs and attorneys' fees
incurred in connection with such Proceeding.
8.12 SEVERABILITY. If any part of this Agreement is or becomes legally
ineffective, invalid or unenforceable in any jurisdiction, the effectiveness,
validity or enforceability of this Agreement in any other jurisdiction, or the
remainder of it in that jurisdiction, will not be affected.
8.13 JOINT AND SEVERAL. In this Agreement:
(a) any agreement, covenant, obligation, representation or warranty on
the part of two or more persons binds them jointly and severally; and
(b) any agreement, covenant, obligation, representation or warranty
in favor of two or more persons is for the benefit of them jointly and
severally.
ARTICLE 9
DEFINITIONS
For the purposes of this Agreement, the following terms shall have the
meanings specified or referred to below when used in this Agreement. Any
reference or citation to a law, statute or regulation shall be deemed to include
any amendments to that law, statute or regulation and judicial and
administrative interpretations of it.
9.1 "ACQUISITION" shall have the meaning set forth in SECTION 1.1.
9.2 "AFFILIATE" means, with respect to any specified Person, each other
Person which, directly or indirectly, controls, is controlled by or is under
common control with such specified Person (whether a general or limited
partner), each officer, director or general partner of such specified Person,
and each other Person who is the beneficial owner of five percent (5%) or more
of any class of the voting securities of such specified Person or five percent
(5%) or more in market value of the outstanding securities of such Person. For
purposes of this definition, "control" means the possession of the power to
direct or cause the direction of all or any part of the management and policies
of a specified Person, whether through the ownership of voting securities, by
contract or otherwise.
9.3 "AGREEMENT" means this Asset Purchase Agreement, including the
Exhibits hereto, which are hereby incorporated herein.
9.4 "ALLOCATION SCHEDULE" shall have the meaning set forth in SECTION
1.2(C).
9.5 "ASSETS" means the assets of Seller identified more particularly on
EXHIBIT A, excluding any Intellectual Property Assets.
9.6 "BMC" means, collectively, BMC Software, Inc., a Delaware corporation,
BMC Software (Cayman) LDC, a Cayman unlimited liability company or any assignee
thereof under the BMC Agreement.
9.7 "BMC AGREEMENT" means that Asset Purchase and Services Agreement dated
as of June 30, 1997, among BMC Software, Inc., a Delaware corporation, BMC
Software (Cayman) LDC, a Cayman unlimited liability company or its assignee,
Buyer, certain shareholders of Buyer, ASI and Eng X. Xxx.
9.8 "BUYER" means Sento Technical Innovations Corporation, a Utah
corporation, or any successor, transferee or assignee thereof.
9.9 "BUYER'S INDEMNIFIED PERSONS" shall have the meaning set forth in
SECTION 7.1.
9.10 "CENTERPOST" means Centerpost Innovations Pty. Ltd. ACN 000-000-000, a
limited company organized under the laws of New South Wales, Australia, or any
successor, transferee or assignee thereof.
9.11 "CLOSING" shall have the meaning set forth in SECTION 1.5(A).
9.12 "CLOSING DATE" means the date and time as of which the Closing
actually takes place.
9.13 "CONTRACTS" means those contracts and agreements identified more
particularly on EXHIBIT B, the rights of which Buyer has elected to acquire from
Seller hereunder.
9.14 "DEED OF RESTRAINT OF TRADE" shall mean that certain Deed of Restraint
of Trade to be executed by and among Buyer and the Shareholders
contemporaneously with the execution of this Agreement, in form acceptable to
Buyer in its discretion.
9.15 "DISCLOSURE SCHEDULES" means the disclosure schedules prepared and
delivered by Seller, Kilat and the Shareholders to Buyer prior to the Closing.
The Disclosure Schedules shall contain all information necessary to make the
representations and warranties set forth in ARTICLE 2 true and correct.
9.16 "DOLLARS" or "$" means United States dollars.
9.17 "EMPLOYEE BENEFIT PLAN" means any stock option, stock right, profit
sharing, thrift-savings, simplified employee pension plan, deferred compensation
plan, severance pay, golden parachute, cafeteria plan, flexible compensation
plan, life insurance, medical, dental, disability, welfare, superannuation or
vacation plans or any other similar plan or arrangement of any kind or
character.
9.18 "ENCUMBRANCE" means any lien, pledge, hypothecation, charge, mortgage,
deed of trust, security interest, encumbrance, equity, trust, equitable
interest, claim, easement, right-of-way, servitude, right of possession, lease
tenancy, license, encroachment, burden, intrusion, covenant, infringement,
interference, proxy, option, right of first refusal, community property
interest; or legend, defect, impediment, exception, condition, restriction,
reservation, limitation, impairment, imperfection of title; or restriction on or
condition to the voting of any security, restriction on the transfer of any
security or other asset, restriction on the receipt of any income derived from
any security or other asset, and restriction on the possession, use, exercise or
transfer of any other attribute of ownership, whether based on or arising from
common law, constitutional provision, statute or contract.
9.19 "ENTITY" means any corporation (including any non-profit corporation),
general partnership, limited partnership, limited liability company, joint
venture, joint stock association, estate, trust, cooperative, foundation, union,
syndicate, league, consortium, coalition, committee, society, firm, company or
other enterprise, association, organization or entity of any nature, other than
a Governmental Authority.
9.20 "GOVERNMENTAL AUTHORITY" means any Australian national, state,
territorial or local governmental authority or semi-governmental authority, any
foreign governmental authority, the United States of America, any State of the
United States, any local authority and any political subdivision of any of the
foregoing, any multi-national organization or body, any agency, department,
commission, board, bureau, court or other authority thereof, or any
quasi-governmental or private body exercising, or purporting to exercise, any
executive, legislative, judicial, administrative, police, regulatory or taxing
authority or power of any nature.
9.21 "GOVERNMENTAL AUTHORIZATION" means any permit (including without
limitation any Environmental Permit), license, franchise, approval, certificate,
consent, ratification, permission, confirmation, endorsement, waiver,
certification, registration, transfer, qualification or other authorization
issued, granted, given or otherwise made available by or under the authority of
any Governmental Authority or pursuant to any Legal Requirement.
9.22 "INTANGIBLE ASSETS" means all Assets which are not Tangible Assets.
9.23 "INTELLECTUAL PROPERTY" means any and all trademarks, trade names,
service marks, patents, copyrights (including any registrations, applications,
licenses or rights relating to any of the foregoing), technology, trade secrets,
inventions, know-how, names, logos, artwork, designs, discoveries, computer
programs, software products and related source code and documentation,
processes, and all other intangible assets, properties and rights.
9.24 "INTELLECTUAL PROPERTY ASSETS" means all Intellectual Property of
Seller, including, without limitation, all Intellectual Property necessary to or
currently utilized in Seller s business.
9.25 "INTELLECTUAL PROPERTY PURCHASE AGREEMENT" means that certain
Intellectual Property Purchase Agreement to be executed by and among Buyer,
Seller, Kilat and the Shareholders contemporaneously with the execution of this
Agreement, in form acceptable to Buyer in its discretion.
9.26 "KILAT" means Kilat Holding Pty. Limited ACN 000-000-000, a limited
company organized under the laws of Australia.
9.27 "KNOWLEDGE" or "KNOWN" - An individual shall be deemed to have
"knowledge" of or to have "known" a particular fact or other matter if such
individual is actually aware of such fact or other matter. An Entity shall be
deemed to have "knowledge" of or to have "known" a particular fact or other
matter if any individual who is serving or who has at any time served as an
officer, director, member, manager, trustee, or shareholder of such Entity (or
in any similar capacity) has, or at any time had, knowledge of such fact or
other matter.
9.28 "LEGAL REQUIREMENT" means any law (including without limitation any
Environmental Laws), statute, ordinance, decree, requirement, Order, treaty,
proclamation, convention, rule or regulation (or interpretation of any of the
foregoing) of, and the terms of any Governmental Authorization issued by, any
Governmental Authority.
9.29 "LIABILITY" means any debt, obligation, duty or liability of any
nature (including any unknown, undisclosed, unfixed, unliquidated, unsecured,
unmatured, unaccrued, unasserted, contingent, conditional, inchoate, implied,
vicarious, joint, several or secondary liability), regardless of whether such
debt, obligation, duty or liability would be required to be disclosed on a
balance sheet prepared in accordance with generally accepted accounting
principles.
9.30 "LOSS" means any loss, damage, injury, harm, detriment, decline in
value, lost opportunity, Liability, exposure, claim, demand, cost of any
Proceeding, settlement, judgment, award, punitive damage award, fine, penalty,
Tax, fee, charge, cost or expense (including, without limitation, costs of
attempting to avoid or in opposing the imposition thereof, interest, penalties,
costs of preparation and investigation, and the fees, disbursements and expenses
of attorneys, accountants and other professional advisors).
9.31 "NOTE" means the promissory note to be executed and delivered by Buyer
to Seller pursuant to SECTION 1.4(D), substantially in the form of EXHIBIT D.
9.32 "OPTION" shall have the meaning set forth in RECITAL A.
9.33 "OPTION AGREEMENT" shall have the meaning set forth in RECITAL A.
9.34 "OPTION PURCHASE PAYMENT" shall have the meaning set forth in SECTION
1.4(A).
9.35 "ORDER" means any order, judgment, injunction, edict, decree, ruling,
pronouncement, determination, decision, opinion, sentence, subpoena, consent
decree, writ or award issued, made, entered or rendered by any court,
administrative agency or other Governmental Authority or by any arbitrator.
9.36 "ORDINARY COURSE OF BUSINESS" means an action taken by a Person if:
(I) such action is recurring in nature, is consistent with the past
practices of such Person and is taken in the ordinary course of the normal day-
to-day operations of such Person;
(ii) the aggregate monetary amount associated with such action (or any
series of related actions) is less than Twenty-Five Thousand Dollars ($25,000),
unless prior to taking such action, the Person obtains from Buyer written
consent to the taking of such action; and
(iii) such action is similar in nature and magnitude to actions
customarily taken, without any separate or special authorization, in the
ordinary course of the normal day-to-day operations of other persons that are in
the same line of business as such Person.
9.37 "PERSON" means any individual, Entity or Governmental Authority.
9.38 "PROCEEDING" means any action, suit, litigation, arbitration, lawsuit,
claim, proceeding (including any civil, criminal, administrative, investigative
or appellate proceeding and any informal proceeding), prosecution, contest,
hearing, inquiry, inquest, audit, examination, investigation, challenge,
controversy or dispute commenced, brought, conducted or heard by or before, or
otherwise involving, any Governmental Authority or any arbitrator.
9.39 "PROPRIETARY INFORMATION" shall have the meaning set forth in SECTION
6.2.
9.40 "PURCHASE PRICE" shall have the meaning set forth in SECTION 1.3.
9.41 "SELLER" means Australian Software Innovations (Services) Pty. Ltd.
ACN 000-000-000, a limited company organized under the laws of Australia.
9.42 "SELLER'S INDEMNIFIED PERSONS" shall have the meaning set forth in
SECTION 7.2.
9.43 "SHAREHOLDERS" refers collectively to Eng Xxx and Xxxx Xxx, in their
individual capacities.
9.44 "TANGIBLE ASSETS" means those Assets identified as "Tangible Assets"
on EXHIBIT A.
9.45 "TAX" means any federal, national, state, territorial, local or
foreign income, gross receipts, license, payroll, employment, excise, severance,
stamp, occupation, premium, environmental, customs duties, franchise, profits,
withholding, social security (or similar), unemployment, disability, real
property, personal property, sales, use, transfer, registration, value added,
fringe benefits or other tax or assessment of any nature whatsoever, including,
without limitation, any customs duty, municipal rates, stamp duties and all
other charges and levies which may be imposed by a Governmental Authority
(including any interest, penalties and additions thereto that may arise in
connection therewith), whether disputed or not.
9.46 "TAX RETURNS" means any return (including any information return),
report, statement, declaration, schedule, notice, notification, form,
certificate or other document or information filed with or submitted to, or
required to be filed with or submitted to, any Governmental Authority in
connection with the determination, assessment, collection or payment of any Tax
or in connection with the administration, implementation or enforcement of or
compliance with any Legal Requirement relating to any Tax.
9.47 "TRANSACTION AGREEMENTS" means this Agreement and such other documents
as are entered into in connection with this Agreement in order to complete the
transactions contemplated hereby, including, without limitation, the Option
Agreement, the Intellectual Property Purchase Agreement and the Deed of
Restraint of Trade.
IN WITNESS WHEREOF, each of the parties hereto has caused this Agreement to
be executed on its behalf as of the date first above written.
"BUYER":
SENTO TECHNICAL INNOVATIONS CORPORATION, a Utah corporation
By: __________________________________________________
Its: __________________________________________________
"CENTERPOST":
THE COMMON SEAL of CENTERPOST INNOVATIONS PTY. LTD.
ACN 000-000-000, a limited company organized
under the laws of Australia was hereunto
affixed in accordance with its articles of
association in the presence of:
____________________ _________________________
Signature of Director Signature of Director/Secretary
____________________ _________________________
Print Name Print Name
____________________ _________________________
Office Held Office Held
"SELLER":
THE COMMON SEAL of AUSTRALIAN SOFTWARE
INNOVATIONS (SERVICES) PTY. LTD
ACN 000-000-000, a limited company organized
under the laws of Australia was hereunto
affixed in accordance with its articles of
association in the presence of:
____________________ _________________________
Signature of Director Signature of Director/Secretary
____________________ _________________________
Print Name Print Name
____________________ _________________________
Office Held Office Held
"KILAT":
THE COMMON SEAL of KILAT HOLDINGS PTY.
LIMITED ACN 000-000-000, a limited
company organized under the laws of Australia
was hereunto affixed in accordance with
its articles of association in the presence of:
____________________ _________________________
Signature of Director Signature of Director/Secretary
____________________ _________________________
Print Name Print Name
____________________ _________________________
Office Held Office Held
"SHAREHOLDERS":
______________________________________________________
Eng Xxx, individually
______________________________________________________
Xxxx Xxx, individually
EXHIBIT A
TO
ASSET PURCHASE AGREEMENT
ASSETS
TANGIBLE ASSETS
[To be completed- Non-intellectual property, tangible assets only]
INTANGIBLE ASSETS
[To be completed- Non-intellectual property, intangible assets only]
EXHIBIT B
TO
ASSET PURCHASE AGREEMENT
CONTRACTS
[To be completed]
EXHIBIT C
TO
ASSET PURCHASE AGREEMENT
ALLOCATION SCHEDULE
Tangible Assets: $100,000
Intangible Assets, including Good Will: $650,000
Purchase Price: $750,000
EXHIBIT D
TO
ASSET PURCHASE AGREEMENT
FORM OF NOTE
[ATTACHED]
EXECUTION COPY
PROMISSORY NOTE
$350,000.00 July 9, 0000
Xxxx Xxxx Xxxx, Xxxx
FOR VALUE RECEIVED, Sento Technical Innovations Corporation, a Utah
corporation (the "BORROWER"), promises and agrees to pay to the order of
Australian Software Innovations (Services) Pty. Ltd ACN 000-000-000, a limited
company organized under the laws of Australia, or order (the "LENDER"), at 00
Xxxxxx Xxxxxx, Xxxxx 000, Xxxxxx XXX, Xxxxxxxxx, or at such other place as the
holder hereof may designate in writing, in lawful money of the United States of
America, the principal sum of Three Hundred Fifty Thousand and no/100 United
States Dollars, according to the terms and conditions set forth in this Note.
1. Borrower shall make payments on the outstanding principal balance of
this Note in the monthly amounts of $50,000 each, commencing on August 8, 1997,
and continuing until February 8, 1998 (the "Maturity Date"). All indebtness
evidenced by this Note which remains outstanding on the Maturity Date shall be
due and payable in full thereon.
2. Borrower may prepay the principal amount of this Note, in whole or in
part, at any time without penalty or premium for any such early payment.
3. If any payment required by this Note is not made when due, or if any
other event occurs or circumstance exists which under any instrument evidencing
or securing the obligations evidenced by this Note entitles the holder hereof to
accelerate the maturity of such obligations, the entire unpaid principal balance
and accrued but unpaid interest hereunder shall, at the option of the holder
hereof, at once become due and payable without notice (time being the essence
hereof). Failure to exercise such option shall not constitute a waiver of the
right to exercise the same in the event of any subsequent default, event or
circumstance giving rise to such right of acceleration.
4. Prior to the Maturity Date (or accelerated Maturity Date pursuant to
Section 3 above), no interest shall be due or payable by Borrower on amounts
outstanding hereunder. All past due principal (whether by acceleration or in
due course) and, if permitted by applicable law, past due interest, shall, both
before and after judgment, bear interest at the rate of twenty percent (20%) per
annum.
5. Borrower agrees to pay the holder hereof a "late charge" equal to five
percent (5%) of any payment due pursuant to this Note which is more than fifteen
(15) days in arrears.
6. In the event that any payment under this Note is not made at the time
and in the manner required (whether before or after maturity), Borrower agrees
to pay, in addition to any late charge required by Section 5 above, any and all
costs and expenses (regardless of the particular nature thereof and whether
incurred before or after the initiation of suit or before or after judgment)
which may be incurred by the holder hereof in connection with the enforcement of
any of its rights under this Note, including, but not limited to, attorneys'
fees and all costs and expenses of collection.
7. Borrower and all sureties, guarantors and endorsers hereof waive
presentment for payment, demand and notice of dishonor and nonpayment of this
Note, and consent to any and all extensions of time, renewals, waivers, or
modifications that may be granted by the holder hereof with respect to the
payment or other provisions of this Note, and to the release of any security, or
any part thereof, with or without substitution.
8. Notwithstanding any other provision contained in this Note or in any
instrument given to evidence or secure the obligations evidenced hereby: (i)
the rates of interest and charges provided for herein and therein shall in no
event exceed the rates and charges which result in interest being charged at a
rate equalling the maximum allowed by law; and (ii) if, for any reason
whatsoever, the holder hereof ever receives as interest in connection with the
transaction of which this Note is a part an amount which would result in
interest being charged at a rate exceeding the maximum allowed by law, such
amount or portion thereof as would otherwise be excessive interest shall
automatically be applied toward reduction of the unpaid principal balance then
outstanding hereunder and not toward payment of interest.
9. This Note is delivered in the State of Utah and shall be governed by
and construed in accordance with the laws of said State, without giving effect
to any conflict of laws provisions. Each of Borrower and the Lender expressly
submits itself to the exclusive, personal jurisdiction of the federal and state
courts situated in Salt Lake City, Utah. This Note shall bind the successors
and assigns of Borrower and shall inure to the successors and assigns of the
Lender.
IN WITNESS WHEREOF, Borrower has executed this Note as of the day and
year first above written.
"Borrower":
Sento Technical Innovations Corporation, a
Utah corporation
By:
__________________________________________
Name:
________________________________________
Title:
_______________________________________
EXECUTION COPY
ASSIGNMENT AGREEMENT
This Assignment Agreement (this "Agreement") is made as of July 9, 1997, by
and among Sento Technical Innovations Corporation, a Utah corporation ("BUYER")
and Australian Software Innovations (Services) Pty. Ltd ACN 000-000-000, a
limited company organized under the laws of Australia (the "SELLER").
RECITALS
Pursuant to that certain Asset Purchase Agreement dated as of July 9, 1997
(the "Asset Purchase Agreement"), among Buyer, Centerpost Innovations Pty. Ltd.
ACN 000-000-000, Seller, Kilat Holdings Pty. Limited ACN 000-000-000, and Eng
Xxx and Xxxx Xxx, Buyer has agreed to acquire from Seller, and Seller has agreed
to sell to Buyer, among other things, the rights and interests of Seller in and
to certain agreements of Seller, and Buyer has agreed to assume the obligations
of Seller thereunder in accordance with the terms of the Asset Purchase
Agreement.
NOW, THEREFORE, in consideration of the covenants and promises contained
herein and for other good and valuable consideration, the receipt and adequacy
of which are hereby acknowledged, Buyer and Seller agree as follows:
10. Seller hereby assigns to Buyer, and Buyer hereby accepts from Seller,
all of Seller's rights, title and interest in, to and under each and every
Contract, as such term is defined in the Asset Purchase Agreement, free and
clear of all Encumbrances except as expressly assumed by Buyer pursuant to the
Asset Purchase Agreement. Buyer hereby assumes and hereafter shall pay,
discharge and perform when due, all obligations of Seller arising under each
Contract which arise on or after the date hereof as provided in the Asset
Purchase Agreement.
11. This Agreement is made pursuant to the terms of the Asset Purchase
Agreement and does not alter or amend any of the obligations, covenants,
representations or warranties contained in the Asset Purchase Agreement. In the
event of any inconsistency between this Agreement and the Asset Purchase
Agreement, the Asset Purchase Agreement shall control.
12. This Agreement may be signed in one of more counterparts, and all
counterparts so executed shall constitute one instrument, binding on the parties
hereto, notwithstanding that the parties are not signatory to the same
counterpart. Executed counterparts of this Agreement transmitted by telecopier
shall be valid and binding.
[SIGNATURE PAGE FOLLOWS]
IN WITNESS WHEREOF, each of Buyer and Seller have duly executed and
delivered this Assignment Agreement as of the date first written above.
"BUYER":
SENTO TECHNICAL INNOVATIONS CORPORATION, a Utah corporation
By:
_____________________________________________
Name:
Title:
"SELLER":
THE COMMON SEAL of AUSTRALIAN SOFTWARE INNOVATIONS (SERVICES)
PTY. LTD. ACN 000-000-000, a limited company organized under the
laws of Australia was hereunto affixed in accordance with its
articles of association in the presence of:
_________________________ _________________________
Signature of Director Signature of
Director/Secretary
_________________________ _________________________
Print Name Print Name
_________________________ _________________________
Office Held Office Held
