EXHIBIT 2.1
AGREEMENT AND PLAN OF MERGER BETWEEN
VOLT INFORMATION SCIENCES, INC.,
AUTOLOGIC , INC.
AND
INFORMATION INTERNATIONAL, INC.
THIS AGREEMENT, is entered into as of October 5, 1995
by and among VOLT INFORMATION SCIENCES, INC., a New York
corporation ("VOLT"), AUTOLOGIC , INC., a Delaware corporation
("NEWCO"), and INFORMATION INTERNATIONAL, INC., a Delaware
corporation ("TRIPLE-I").
W I T N E S S E T H :
WHEREAS, VOLT owns 99% of all the issued and
outstanding capital stock of AUTOLOGIC, INC., a California
corporation ("AUTOLOGIC"), and all of the issued and outstanding
capital stock of NEWCO;
WHEREAS, AUTOLOGIC owns all of the issued and
outstanding stock of AUTOLOGIC INTERNATIONAL, LTD., a Delaware
corporation ("AIL"), with branches in Spain, France and Germany;
WHEREAS, VOLT owns, directly or indirectly, all of the
issued and outstanding stock of Volt-Autologic, Ltd. of England,
a U.K. corporation, Volt-Autologic, Ltd. of Israel, an Israeli
corporation, Volt-Autologic, Inc. of Canada, a Canadian
corporation, Volt-Autologic AB of Sweden, a Swedish corporation
and Volt Autologic Pty. Limited of Australia, an Australian
corporation (collectively the "VOLT SUBSIDIARIES");
WHEREAS, VOLT intends to merge AUTOLOGIC into NEWCO
with NEWCO remaining as the surviving corporation;
WHEREAS, the parties hereto intend to merge TRIPLE-I
into NEWCO, with NEWCO remaining as the surviving corporation,
subject to the terms of this Agreement;
WHEREAS, prior to the Closing Date and the merger of
TRIPLE-I into NEWCO, VOLT shall own 3,022,900 shares of Common
Stock of NEWCO;
WHEREAS, the parties hereto intend that NEWCO shall
purchase, and VOLT shall sell to NEWCO, all of the issued and
outstanding capital stock of the VOLT SUBSIDIARIES for 310,100
shares of NEWCO Common Stock;
WHEREAS, the parties intend that VOLT shall be entitled
to receive up to an additional 100,000 shares of NEWCO Common
Stock in the event that certain options granted by TRIPLE-I shall
be or shall have been exercised;
WHEREAS, upon the closing of the transactions described
herein, VOLT shall own an aggregate amount of 3,333,000 shares of
NEWCO and shall be entitled to receive up to 100,000 additional
shares of NEWCO Common Stock as provided herein;
WHEREAS, the parties intend that upon the merger of
TRIPLE-I into NEWCO, the Stockholdings of each shareholder of
TRIPLE-I shall be converted into the same number of shares of
NEWCO Common Stock , as a consequence of which, as of the
Effective Time of the merger of TRIPLE-I into NEWCO, TRIPLE-I's
shareholders shall hold an amount of shares of NEWCO Common Stock
equal to (i) 2,405,620 shares of NEWCO Common Stock (which is
equal to the number of TRIPLE-I shares of Common Stock that were
-2-
issued and outstanding on June 25, 1995), and (ii) the number of
shares of TRIPLE-I Common Stock that were issued subsequent to
June 25, 1995, and prior to the Effective Time, upon the exercise
of certain stock options granted by TRIPLE-I; and
WHEREAS, the Boards of Directors of TRIPLE-I, VOLT and
NEWCO each have determined, with the advice of their respective
independent investment bankers, that it is in the best interests
of their respective companies and shareholders that TRIPLE-I
shall be merged into NEWCO (and that NEWCO shall be the surviving
corporation) and that such merger presents an opportunity for
their respective companies to achieve long-term strategic and
financial benefits, and accordingly VOLT, NEWCO and TRIPLE-I have
agreed to effect such merger upon the terms and subject to the
conditions set forth herein.
NOW, THEREFORE, in order to consummate the merger, sale
and purchase set forth above and in consideration of the promises
and the mutual covenants and benefits to be derived from this
Agreement, VOLT, NEWCO and TRIPLE-I stipulate, consent and agree
as follows:
ARTICLE I- MERGER AND SALE OF SHARES
1.1 The TRIPLE-I/NEWCO Merger Subject to the terms
and conditions of this Agreement, at the Effective Time (as
defined in this Section 1.1), TRIPLE-I shall be merged with and
into NEWCO in accordance with this Agreement and the separate
corporate existence of TRIPLE-I shall thereupon cease (the
-3-
"TRIPLE-I/NEWCO Merger"). NEWCO shall be the surviving
corporation in the TRIPLE-I/NEWCO Merger (sometimes hereinafter
referred to as the "Surviving Corporation"). The TRIPLE-I/NEWCO
Merger shall have the effect specified in the Delaware General
Corporation Law (the "DGCL"). If all the conditions to the
TRIPLE-I/NEWCO Merger set forth in Article 8 shall have been
fulfilled or waived in accordance herewith, the parties hereto
shall cause a Certificate of Merger meeting the requirements of
Section 251 of the DGCL to be properly executed and filed in
accordance with such Section on the Closing Date or as soon as
practicable thereafter. The TRIPLE-I/NEWCO Merger shall become
effective at the time of the filing of the Certificate of Merger
in accordance with the DGCL or at such later time which the
parties hereto shall have agreed upon and designated in such
filings as the effective time of the TRIPLE-I/NEWCO Merger (the
"Effective Time"), but in any event as soon as practicable on or
after the Closing Date.
1.2 Shares to be Purchased from VOLT. Subject to the
terms and conditions of this Agreement, on the Closing Date VOLT
shall sell and transfer to NEWCO all of the issued and
outstanding shares of
Volt-Autologic, Ltd. of England
Volt-Autologic, Ltd. of Israel
Volt-Autologic, Inc. of Canada
Volt-Autologic AB of Sweden
Volt-Autologic Pty. Limited of Australia
(the "Volt Subsidiary Shares"), provided, however, that at the
Closing, one of the two shares of Volt-Autologic, Ltd. of Israel,
-4-
and one of the forty thousand shares of VOLT-Autologic Pty.
Limited of Australia, shall be conveyed to AIL.
1.3 Consideration for the Shares. The consideration
for the Volt Subsidiary Shares to be paid to VOLT by NEWCO at the
Closing shall be 310,100 fully-paid and non-assessable shares of
the common stock of NEWCO. The consideration shall be allocated
as follows:
Allocated Shares of
Entities Stock Acquired NEWCO Stock
Volt-Autologic, Ltd. of England 110,000
Volt-Autologic, Ltd. of Israel 10,000
Volt-Autologic, Inc. of Canada 80,100
Volt-Autologic AB of Sweden 70,000
Volt-Autologic Pty. Limited of Australia 40,000
Total NEWCO Shares 310,100 shares
1.4 Additional Consideration. As additional
consideration for the TRIPLE-I/NEWCO Merger, VOLT shall be
entitled to receive, and NEWCO shall issue to VOLT, up to an
additional 100,000 fully-paid and non-assessable shares of common
stock of NEWCO (the "Additional Shares") in the following
circumstances and subject to the following conditions:
(a) As of June 25, 1995, there were outstanding
options (the "TRIPLE-I Options") issued pursuant to the TRIPLE-I
1976 Employees' Stock Option Incentive Plan and the TRIPLE-I
Directors' Stock Option Plan (the "TRIPLE-I Option Plans")
entitling the holders thereof to acquire 590,500 shares of
TRIPLE-I Common Stock upon the exercise of such TRIPLE-I
Options.
-5-
(b) Pursuant to the provisions of Section 5.7(a)
below, NEWCO will assume the obligation of TRIPLE-I to the option
holders in respect of the TRIPLE-I Options and will issue,
instead of TRIPLE-I shares, NEWCO shares upon the exercise of
such options (which NEWCO Shares are referred to hereafter as
the "Option Shares") .
(c) The parties agree that NEWCO will issue
Additional Shares to VOLT in satisfaction of NEWCO's obligation
under this Section 1.4 on the basis of 100 Additional Shares for
every 590 Option Shares issued subsequent to June 25, 1995, and
that such Additional Shares shall be issued within 30 days
following the end of each calendar quarter during the life of the
TRIPLE-I Options, commencing with the quarter following the
Closing, but in quarterly lots of not less than 1,000 each,
except in respect of the final quarter. In the event that fewer
than 1,000 Additional Shares would be issued in respect of a
quarter, except in respect of the final quarter, such number of
shares will be added to the Additional Shares issuable in the
following quarter or quarters until the minimum required number
is met or exceeded.
1.5 Conversion of Stock. As of the Effective Time, by
virtue of the TRIPLE-I/NEWCO Merger and without any action on the
part of any stockholder of TRIPLE-I:
(a) Each share of TRIPLE-I Common Stock that is
owned by TRIPLE-I or by any subsidiary of TRIPLE-I shall be
canceled and retired and shall cease to exist.
-6-
(b) Each share of TRIPLE-I Common Stock that
remains outstanding at the Effective Time (the "Existing TRIPLE-I
Common Stock") shall be converted into and become one validly
issued, fully paid and non-assessable share of NEWCO Common
Stock.
(c) Each share of Common Stock of NEWCO that has
been issued prior to the Closing and remains outstanding at the
Effective Time shall remain issued and outstanding and shall be
unchanged by the TRIPLE-I/NEWCO Merger.
1.6 Exchange Procedures. (a) As of the Effective
Time, each certificate theretofore representing issued and
outstanding shares of Existing TRIPLE-I Common Stock ("Existing
TRIPLE-I Certificates"), shall be deemed for all purposes to
evidence ownership of, and to represent, the same number of
shares of NEWCO. The registered owner on the books and records
of NEWCO, or its transfer agents, of any such Existing TRIPLE-I
Certificate shall, until such certificate is surrendered for
transfer pursuant to this Section 1.6(a), have and be entitled to
exercise any and all voting and other rights with respect to, and
receive any and all dividend and other distributions upon, the
shares of NEWCO Common Stock evidenced by such Existing TRIPLE-I
Certificate.
(b) If after the Effective Time an Existing
TRIPLE-I Certificate is presented for transfer to NEWCO , it
shall be canceled and exchanged for a certificate or certificates
-7-
for the same number of shares of NEWCO Common Stock as was
represented by such Existing TRIPLE-I Certificate.
ARTICLE II - THE CLOSING
2.1 The Closing shall take place on November 3, 1995,
or such other date as the parties may agree, at 10:00 a.m. New
York time, at the offices of Xxxxxx Xxxxxx Flattau & Klimpl, LLP,
1211 Avenue of the Xxxxxxxx, 00xx Xxxxx, Xxx Xxxx, Xxx Xxxx
00000, but in all events, unless otherwise agreed by the parties
hereto, the Closing shall be deemed to have occurred as of the
nearest fiscal month end, provided that each of the conditions
precedent to Closing have been met or waived by a party entitled
to the satisfaction of such condition. In the event that a
condition precedent to a party's obligation to close has not been
met due to a failure to complete a process or obtain a consent or
approval required to fulfill the condition or has not been waived
pursuant to this Section 2.1, the parties shall diligently
endeavor to complete the process or obtain the consent or
approval and the Closing shall be postponed to a date which the
parties shall agree should reasonably be sufficient to permit
satisfying the condition, or obtaining the consent or approval;
provided however, in no event shall the Closing be postponed
beyond March 31, 1996. To the extent necessary or required, the
transfer of the shares of Volt-Autologic Ltd. of Israel shall be
effected at a bank in Israel selected by the parties.
-8-
ARTICLE III - REPRESENTATIONS OF VOLT
VOLT represents and warrants to TRIPLE-I that, as of
the Closing Date:
3.1 Organization, Standing and Power of VOLT. VOLT is
a corporation duly organized, validly existing and in good
standing under the laws of the jurisdiction in which it is
incorporated and has the requisite corporate power and authority
to carry on its business as currently conducted.
3.2 Organization, Standing and Power of AUTOLOGIC and
NEWCO.
(a) AUTOLOGIC is a corporation duly organized,
validly existing and in good standing under the laws of the
jurisdiction in which it is incorporated and has the requisite
corporate power and authority to carry on its business as
currently conducted. AUTOLOGIC is duly qualified or licensed to
do business and in good standing in each jurisdiction where the
nature of its business or the character of the properties owned
or leased by it makes such qualification or licensing necessary,
except where the failure to be so qualified or licensed would not
have a material adverse effect on the assets, operations,
business or financial condition of AUTOLOGIC, taken as a whole.
The minute books of AUTOLOGIC which VOLT has caused to be made
available to TRIPLE-I for inspection, correctly reflect all
actions taken by the stockholders or directors of AUTOLOGIC.
(b) NEWCO is a corporation duly organized,
validly existing and in good standing under the laws of the
-9-
jurisdiction in which it is incorporated and has the requisite
corporate power and authority to carry on its business as
currently conducted. NEWCO is duly qualified or licensed to do
business and in good standing in each jurisdiction where the
nature of its business or the character of the properties owned
or leased by it makes such qualification or licensing necessary,
except where the failure to be so qualified or licensed would not
have a material adverse effect on the assets, operations,
business or financial condition of NEWCO, taken as a whole. The
minute books of NEWCO which VOLT has caused to be made available
to TRIPLE-I for inspection, correctly reflect all actions taken
by the stockholders or directors of NEWCO.
3.3 (a) Capitalization of AUTOLOGIC. The authorized
capital stock of AUTOLOGIC consists of 50,000 shares of Common
Stock of which VOLT is the record and beneficial owner of 3,478
shares (the "AUTOLOGIC Shares"). Until the merger described in
Paragraph 5.1(c), VOLT will be the record and beneficial owner
of the AUTOLOGIC Shares, in each case free and clear of any lien,
claim, charge or encumbrance of any kind except for transfer
restrictions, imposed by applicable state and federal securities
laws. All the AUTOLOGIC Shares are duly authorized, validly
issued, fully paid and nonassessable, and immediately prior to
the merger described in Section 5.1(c), only the AUTOLOGIC
Shares will be issued and outstanding. There are not outstanding
any subscriptions, options, warrants, conversion rights or other
agreements or commitments of any kind obligating AUTOLOGIC
-10-
directly or indirectly, contingently or otherwise, to issue or
sell any shares of its capital stock or any securities
convertible into or exchangeable for any such shares, and no
authorization therefor has been given. Except as provided by
federal or state securities laws, the AUTOLOGIC Shares are not
subject to any restrictions, contractual or otherwise, relating
to their disposition, nor to any right or obligation of AUTOLOGIC
or any other person to purchase them.
(b) Capitalization of NEWCO. At the closing,
the authorized capital stock of NEWCO will consist of 9,000,000
shares of Common Stock. Immediately prior to the Closing, VOLT
will be the record and beneficial owner of 3,022,900 shares of
NEWCO Common Stock which will be all of the issued and
outstanding shares of NEWCO, in each case free and clear of any
lien, claim, charge or encumbrance of any kind (which together
with the shares of NEWCO Common Stock to be issued to VOLT
pursuant to Section 1.3 of this Agreement are hereinafter
referred to as the "Unregistered NEWCO Shares"). All the
Unregistered NEWCO Shares will be duly authorized, validly
issued, fully paid and nonassessable. Except as set forth in
this Agreement, there will not be outstanding any subscriptions,
options, warrants, conversion rights or other agreements or
commitments of any kind obligating NEWCO directly or indirectly,
contingently or otherwise, to issue or sell any shares of its
capital stock or any securities convertible into or exchangeable
for any such shares, and no authorization therefor has been
-11-
given. Except as provided by federal or state securities laws,
the NEWCO shares of Common Stock are not subject to any
restrictions, contractual or otherwise, relating to their
disposition, nor to any right or obligation of NEWCO or any other
person to purchase them.
3.4 AUTOLOGIC and NEWCO Charter Documents and By-Laws.
(a) True and correct copies of the Articles of
Organization and By-Laws as most recently amended, stock issuance
and ownership records and lists of officers and directors of
AUTOLOGIC have been furnished to TRIPLE-I.
(b) True and correct copies of the Certificate of
Incorporation and By-Laws as most recently amended, stock
issuance and ownership records and lists of officers and
directors of NEWCO have been furnished to TRIPLE-I.
3.5 VOLT SUBSIDIARIES Articles of Organization,
Standing and Power.
(a) Each of the VOLT SUBSIDIARIES is a
corporation duly organized, validly existing and in good standing
under the laws of the jurisdiction in which it is organized or
incorporated, as the case may be, and has the requisite corporate
power and authority to carry on its business as currently
conducted. The VOLT SUBSIDIARIES are each duly qualified or
licensed to do business and in good standing in each jurisdiction
where the nature of its business or the character of the
properties owned or leased by it makes such qualification or
-12-
licensing necessary, except where the failure to be so qualified
or licensed would not have a material adverse effect on the
assets, operations, business or financial condition of the VOLT
SUBSIDIARIES. The minute books of the VOLT SUBSIDIARIES, which
VOLT has caused to be made available to TRIPLE-I for inspection,
correctly reflect all actions taken by the stockholders,
directors or managing agents of each of the VOLT SUBSIDIARIES.
3.6 VOLT SUBSIDIARIES' SHARES. The authorized capital
stock of each VOLT SUBSIDIARY consists of the following:
Subsidiary Shares of Common Stock
Volt-Autologic, Ltd. of England 100 shares
Volt-Autologic, Ltd. of Israel 60,000 shares
Volt-Autologic, Inc. of Canada 100 shares
Volt-Autologic AB of Sweden 500 shares
Volt-Autologic Pty. Limited of Australia 100,000 shares
VOLT and or one or more or VOLT's wholly-owned subsidiaries is
the record and beneficial owner of all of the Volt Subsidiary
Shares in each case free and clear of any lien, claim, charge or
encumbrance of any kind. All the VOLT SUBSIDIARIES' Shares are
duly authorized, validly issued, fully paid and nonassessable,
and immediately prior to the Closing, the following shares of the
authorized capital stock of the VOLT SUBSIDIARIES are issued and
outstanding:
Subsidiary Outstanding Shares
Volt-Autologic, Ltd. of England 100 shares
Volt-Autologic, Ltd. of Israel 2 shares
-13-
Volt-Autologic, Inc. of Canada 100 shares
Volt-Autologic AB of Sweden 500 shares
Volt-Autologic Pty. Limited of
Australia 100,000 shares
There are not outstanding any subscriptions, options, warrants,
conversion rights or other agreements or commitments of any kind
obligating any of the VOLT SUBSIDIARIES or VOLT, directly or
indirectly, contingently or otherwise, to issue or sell any
shares of the VOLT SUBSIDIARIES' capital stock or any securities
convertible into or exchangeable for any such shares, and no
authorization therefor has been given. Except as provided by
federal, state, foreign, or provincial securities laws, the
VOLT SUBSIDIARIES Shares are not subject to any restrictions,
contractual or otherwise, relating to their disposition, nor to
any right or obligation of VOLT SUBSIDIARIES or any other person
to purchase them. Upon the TRIPLE-I/NEWCO Merger, as provided
for in this Agreement, NEWCO will have good and valid title to
the VOLT SUBSIDIARIES' Shares, free and clear of any lien, claim,
charge or encumbrance of any kind, except for such restrictions
as may be imposed by federal, state, foreign or provincial
securities laws, or state notice requirements.
3.7 VOLT SUBSIDIARIES' Articles of Organization and By
Laws. True and correct copies of the Articles of Organization
and By Laws or all equivalent documents under the jurisdiction of
each of the VOLT SUBSIDIARIES, as most recently amended, share
issuance and ownership records and lists of officers and
-14-
directors of the VOLT SUBSIDIARIES have been provided to TRIPLE-I
by VOLT.
3.8 AIL Organization, Standing and Power. AIL is a
corporation duly organized, validly existing and in good standing
under the laws of the jurisdiction in which it is incorporated
and has the requisite corporate power and authority to carry on
its business as currently conducted. AIL is duly qualified or
licensed to do business and in good standing in each jurisdiction
where the nature of its business or the character of the
properties owned or leased by it makes such qualification or
licensing necessary, except where the failure to be so qualified
or licensed would not have a material adverse effect on the
assets, operations, business or financial condition of AIL, taken
as a whole. The minute books of AIL, true copies of which VOLT
has caused to be made available to TRIPLE-I for inspection,
correctly reflect all actions taken by the stockholders or
directors of AIL.
3.9 Capitalization of AIL. The authorized capital
stock of AIL consists of 200 shares of common stock. AUTOLOGIC
is and at the Closing NEWCO will be the record and beneficial
owner of all of the issued and outstanding capital stock of AIL,
free and clear of any lien, claim, charge or encumbrance of any
kind. All the capital stock of AIL is duly authorized, validly
issued, fully paid and nonassessable, and 150 shares of the
authorized capital stock of AIL are and at the Closing will be
issued and outstanding (the "AIL Shares"). There are not
-15-
outstanding any subscriptions, options, warrants, conversion
rights or other agreements or commitments of any kind obligating
AIL, AUTOLOGIC, NEWCO or VOLT, directly or indirectly,
contingently or otherwise, to issue or sell any shares of AIL's
capital stock or any securities convertible into or exchangeable
for any such shares, and no authorization therefor has been
given. Except as provided by federal or state securities laws,
the AIL Shares are not subject to any restrictions, contractual
or otherwise, relating to their disposition, nor to any right or
obligation of AIL or any other person to purchase them. Upon the
Closing of this Agreement and the merger provided for in Article
5.1(c), NEWCO will have good and valid title to the AIL Shares,
free and clear of any lien, claim, charge or encumbrance of any
kind, except for such restrictions as may be imposed by federal
or state securities laws.
3.10 AIL's Articles of Organization and By Laws. True
and correct copies of the Articles of Organization and By Laws,
as most recently amended, stock issuance and ownership records
and lists of officers and directors of AIL have been furnished to
TRIPLE-I by VOLT.
3.11 No Other AUTOLOGIC or NEWCO Subsidiaries.
AUTOLOGIC and NEWCO have no other subsidiaries except those
listed on Schedule 3.11. Except as listed on Schedule 3.11, any
prior subsidiary of AUTOLOGIC or NEWCO has been properly and duly
dissolved prior to the Closing Date and there have been no
transfers, distributions or dividends to AUTOLOGIC or NEWCO by
-16-
any subsidiary in liquidation or during the ownership of
AUTOLOGIC by VOLT which would render AUTOLOGIC or NEWCO liable
for any debt of a subsidiary.
3.12 VOLT Authority; Non-contravention. VOLT has all
requisite corporate power and authority to execute and deliver
this Agreement and to perform its obligations under this
Agreement. The execution and delivery of, and the performance of
its obligations under, this Agreement have been duly authorized
by all necessary corporate action of VOLT. VOLT has duly
executed and delivered this Agreement, and this Agreement is the
legal, valid and binding obligation of VOLT, enforceable in
accordance with its terms, subject to applicable bankruptcy,
insolvency, reorganization, moratorium and other laws generally
applicable to creditors' rights and remedies and to the exercise
of judicial discretion in accordance with general principles of
equity. Except as set forth in Schedule 3.12, the execution and
delivery by VOLT of this Agreement does not and the performance
by VOLT of its respective obligations under this Agreement and
the consummation of the transactions contemplated hereby will
not, violate, conflict with, or result (with or without the
giving of notice or the lapse of time or both) in the breach or
termination of, or default under, or result in the creation of
any material lien, security interest, charge or encumbrance upon
any of the properties or assets of VOLT, AUTOLOGIC, NEWCO the
VOLT SUBSIDIARIES or AIL under, any provision of (i) the articles
of organization (or Certificate of Incorporation) or by-laws of
-17-
VOLT, AUTOLOGIC, NEWCO, AIL or the VOLT SUBSIDIARIES or of any
law, rule or regulation of any governmental body or any order,
judgment or decree applicable to any of them or any of their
assets, or (ii) any material loan or credit agreement, note,
bond, lease, license, franchise, mortgage, indenture or other
agreement, obligation or instrument to which NEWCO, AUTOLOGIC,
AIL, the VOLT SUBSIDIARIES or VOLT is a party or by which any of
them may be bound or under which they enjoy any rights or
privileges. Except as provided in Schedule 3.12, no consent,
approval, order or authorization of, or registration, declaration
or filing with, any court, administrative agency or commission or
other governmental authority or agency, domestic or foreign, is
required by or with respect to VOLT, AUTOLOGIC, AIL or the VOLT
SUBSIDIARIES or will be required with respect to NEWCO in
connection with the execution and delivery of this Agreement by
VOLT or the consummation of the transactions contemplated hereby.
3.13 Governmental Approvals and Filings. Except as
listed herein, no consent, approval of action of, filing with or
notice to any Governmental or Regulatory Authority on the part of
VOLT, NEWCO, AUTOLOGIC, any VOLT SUBSIDIARY or AIL is required in
connection with the execution, delivery and performance of this
Agreement and the consummation of the transactions contemplated
hereby or thereby:
(a) The expiration of the Xxxx Xxxxx Xxxxxx
Antitrust Improvement Act, 15 U.S.C. Section 18a, waiting period
(whether or not extended), without receipt by either party hereto
-18-
of an objection from the United States Justice Department or the
Federal Trade Commission, after the filing by both parties of a
completed Xxxx Xxxxx Xxxxxx pre-merger notification form and
payment by each of the required fee.
(b) The notification, not less than twenty days
before the Closing, of the French Treasury, of the transaction,
and specifically that as a result of the planned merger of
AUTOLOGIC and NEWCO, NEWCO would become the sole shareholder of
AIL.
(c) The filing promptly after the execution of
this Agreement of a notification with the German Federal Cartel
Office pursuant to Section 23.24 of the German Act Against
Restraints of Competition.
(d) The notification, prior to or within 30 days
of the Closing, of the transaction to Investment Canada pursuant
to the Investment Canada Act.
(e) The notification at least 45 days before the
Closing of the Australian Foreign Investment Board under the
Foreign Acquisitions and Takeovers Act of this transaction and
that, as a result of thereof, NEWCO would become the sole
shareholder of VAPL, and the passage of the waiting period
thereunder without objection or the imposition of conditions.
(f) The obtaining of tax clearance from the State
of California for the merger provided in Section 5.1(d).
(g) The filing and effectiveness of the
Registration Statement on Form S-4 as described in Section 7.11
-19-
of this Agreement, and applicable Blue Sky Filings, and filings
pursuant to the Securities Exchange Act of 1934, as amended (the
"Exchange Act").
3.14 Financial Statements and Condition.
(a) Prior to the execution of this Agreement,
VOLT has delivered to TRIPLE-I true and complete copies of the
following financial statements of AUTOLOGIC, AIL and the VOLT
SUBSIDIARIES: (i) audited consolidated and combined balance
sheets for the annual periods ended October 28, 1994, and October
29, 1993, accompanied by the unqualified independent accountants'
audit report; (ii) audited consolidated and combined statements
of operations and statements of cash flows for each of the annual
periods ended October 28, 1994, October 29, 1993, and October 30,
1992, accompanied by the unqualified independent accountants'
report ((i) and (ii) together are hereinafter referred to as the
VOLT Annual Financial Statements); and (iii) unaudited interim
consolidated and combined balance sheets, statements of
operations and cash flows for the nine months ended July 28, 1995
(accompanied by the unqualified independent accountants' review
report and conformed to year end presentations) ((iii) is
hereinafter referred to as the "VOLT Interim Financial
Statements"and July 28, 1995 is hereafter referred to as the
"VOLT Interim Financial Statement Date"). (The "VOLT Interim
Financial Statements", together with the VOLT Annual Financial
Statements, are hereinafter referred to as the "VOLT Financial
Statements"). All the VOLT Financial Statements were prepared
-20-
from the Books and Records of AUTOLOGIC, AIL and the VOLT
SUBSIDIARIES in accordance with GAAP and fairly present in all
material respects the combined financial condition and results of
operations of AUTOLOGIC, AIL and the VOLT SUBSIDIARIES as of the
respective dates thereof and for the respective periods covered
thereby.
(b) Except for the execution and delivery of this
Agreement, the transactions to take place pursuant hereto on or
prior to the Closing Date, and the transactions listed on
Schedule 3.14 hereto, since October 28, 1994: (i) there has not
been any material adverse change in the Condition of the
Business, other than those occurring as a result of general
economic or financial conditions or other developments which are
not unique to the Business but also affect other Persons who
participate or are engaged in lines of business similar to the
Business; (ii) the Business has been operated in the ordinary
course, consistent with past practice; and (iii) there have been
no out of the ordinary course of business transactions not
disclosed to TRIPLE-I.
(c) Since the VOLT Interim Financial Statement
Date, AUTOLOGIC, AIL, NEWCO and the VOLT SUBSIDIARIES have
incurred no Liabilities, other than Liabilities incurred in the
ordinary course of business, except for those expenses incurred
with respect to the TRIPLE-I/NEWCO Merger which are to be borne
by VOLT as provided in Section 7.9.
-21-
(d) By the Closing, AUTOLOGIC, AIL, NEWCO or the
VOLT SUBSIDIARIES will not owe any money (1) to VOLT, or (2) to
banks or others for moneys borrowed.
(e) As at the VOLT Interim Financial Statement
Date, there were no Liabilities of AUTOLOGIC, AIL, or the VOLT
SUBSIDIARIES other than Liabilities that are reflected, accrued
or reserved against on the VOLT Interim Financial Statements (for
which the reserves were appropriate and reasonable) and there
will be on the Closing Date no Liabilities other than (i) those
Liabilities which were reflected in the VOLT Interim Financial
Statements which have not been paid or discharged, and (ii) those
Liabilities incurred in the ordinary course of business and
consistent with past practices since the VOLT Interim Financial
Statement Date.
3.15 Taxes.
(a) VOLT has paid or will timely pay all Federal
income taxes payable by AUTOLOGIC, NEWCO or AIL that are
attributable to any Pre-Closing Tax Period and have been incurred
on or prior to the Closing Date.
(b) VOLT has paid or will timely pay or cause to
be paid all foreign, state and local income taxes and sales and
use, transfer, value added, excise and other taxes due and
payable by NEWCO, AUTOLOGIC, AIL or any of the VOLT SUBSIDIARIES,
which were incurred and due prior to the Closing Date.
-22-
3.16 Legal Proceedings. Except as disclosed in
Schedule 3.16:
(a) There are no Actions or Proceedings Pending
or, to the Knowledge of VOLT, AUTOLOGIC, NEWCO, the VOLT
SUBSIDIARIES or AIL threatened against, relating to or affecting
AUTOLOGIC, NEWCO, any VOLT SUBSIDIARY or AIL with respect to the
Business or any of its Assets and Properties; and
(b) There are no Orders outstanding against
AUTOLOGIC, NEWCO, AIL or any VOLT SUBSIDIARY.
3.17 Compliance With Laws and Orders. None of
AUTOLOGIC, NEWCO, the VOLT SUBSIDIARIES or AIL is in violation of
or in default under any Law or Order applicable to the Business
or the Assets the effect of which, individually or in the
aggregate with other such violations and defaults, could
reasonably be expected to be materially adverse to the Condition
of the Business.
3.18 Employee Benefit Plans.
(a) Except as listed on Schedule 3.18, AUTOLOGIC,
NEWCO, the VOLT SUBSIDIARIES and AIL have no benefit plan nor
defined contribution plan, stock ownership plan, executive
compensation plan, bonus plan, incentive compensation plan or any
arrangement, deferred compensation agreement or arrangement,
employment, termination or retention contract, agreement or
arrangement, vacation pay, medical, dental, disability or death
benefit plan (whether provided through insurance, on a funded or
unfunded basis or otherwise), employee stock option or stock
-23-
purchase plan, severance pay plan, and any other employee benefit
plan, program, arrangement, agreement or policy including,
without limitation, each "employee benefit plan" within the
meaning of Section 3(3) of ERISA, which is maintained or
contributed to by VOLT, NEWCO, the VOLT SUBSIDIARIES, AUTOLOGIC
or AIL for the benefit of, or relating to, AUTOLOGIC'S, NEWCO'S,
the VOLT SUBSIDIARIES' or AIL's current or former employees or
their dependents, survivors or beneficiaries (all of which are
hereinafter referred to as the "Benefit Plans"). VOLT has made
available to TRIPLE-I a true and complete copy of (i) the most
recent annual report (Form 5500) filed with the IRS, (ii) each
such Benefit Plan, (iii) if applicable, each trust agreement
relating to each such Benefit Plan, (iv) the most recent summary
plan description for each Benefit Plan for which a summary plan
description is required, and (v) the most recent determination
letter, if any, issued by the IRS with respect to any Benefit
Plan qualified under Section 401(a) of the Internal Revenue Code.
(b) To the Knowledge of VOLT, NEWCO, AUTOLOGIC,
AIL and the VOLT SUBSIDIARIES there have been no "prohibited
transactions" within the meaning of Section 4975 of the Code or
Section 406 of ERISA with respect to any Benefit Plan of VOLT,
NEWCO, the VOLT SUBSIDIARIES, AUTOLOGIC, or AIL that could result
in a material adverse effect on the Condition of the Business.
There is no pending or threatened assessment, complaint
proceeding, or investigation of any kind in any court or
government agency with respect to any employee benefit plan of
-24-
VOLT or the VOLT SUBSIDIARIES. Aside from routine claims for
benefits, there are no disputes or threatened disputes of any
kind with participants or beneficiaries relating to any Benefit
Plan.
(c) Each of the Benefit Plans, and its
administration, are in compliance with its material terms,
federal, state, foreign or provincial laws, and the requirements
of ERISA and the Code, except for such failures which,
individually or in the aggregate, could not reasonably be
expected to have a material adverse effect on the Condition of
the Business.
(d) All contributions and other payments required
to be made by VOLT, NEWCO, AUTOLOGIC, the VOLT SUBSIDIARIES or
AIL to any Benefit Plan with respect to any periods ending before
or at or including the Closing Date have been made and, to the
extent made or reserved for prior to the date of the VOLT Interim
Financial Statements, have been reflected in the VOLT Interim
Financial Statements in accordance with GAAP.
(e) None of NEWCO, AUTOLOGIC, AIL or the VOLT
SUBSIDIARIES nor any member of AUTOLOGIC's controlled group,
within the meaning of Section 414 of the Code, has ever
contributed, or is currently obligated to contribute to any
multiemployer plan (as defined in Section 4001(a)(3) of ERISA) on
behalf of NEWCO's, AUTOLOGIC's, AIL's or the VOLT SUBSIDIARIES'
current or former employees, and no withdrawal liability is due
or owing in respect of any such multiemployer plan by AUTOLOGIC,
-25-
AIL, or the VOLT SUBSIDIARIES, or any member of AUTOLOGIC's
controlled group (as so defined). Neither VOLT, nor any member
of VOLT's controlled group, has ever maintained a Benefit Plan
providing retiree medical benefits.
(f) Each Welfare Plan that is a "group health
plan," as defined in Section 607(1) of ERISA, and each "group
health plan" (as so defined) of any ERISA Affiliate has, to the
knowledge of VOLT, been operated, in all meaningful respects, in
compliance with the provisions of Part 6 of Title I of ERISA and
Section 162(k) (prior to its amendment in 1988) and 4980B of the
Internal Revenue Code at all times. For purposes of this
paragraph. "Welfare Plan" means any employee welfare benefit
plan as defined in Section 3(1) of ERISA.
(g) With respect to the Benefit Plans, no event
has occurred and, to the knowledge of VOLT, there exists no
condition or set of circumstances, in connection with AUTOLOGIC,
AIL, NEWCO or any VOLT SUBSIDIARY which could be subject to any
liability which has, when taken together with all such other
liabilities hereunder, a material adverse effect on the Condition
of the Business under the terms of such Benefit Plans. ERISA,
the Internal Revenue Code or any other applicable Law. No
Benefit Plan is subject to Title IV of ERISA.
3.19 Real Property.
(a) AUTOLOGIC, NEWCO, the VOLT SUBSIDIARIES and
AIL have valid and subsisting leasehold estate in and the right
to quiet enjoyment of the real properties they presently occupy
-26-
listed in Schedule 3.19. Each such Real Property Lease is a
legal, valid and binding agreement, enforceable in accordance
with its terms, and, to the Knowledge of VOLT, AUTOLOGIC, NEWCO,
AIL and the VOLT SUBSIDIARIES, of each other Person that is a
party thereto, and, to the Knowledge of VOLT, AUTOLOGIC, NEWCO,
AIL and the VOLT SUBSIDIARIES there is no default (or any
condition or event which, after notice or lapse of time or both,
would constitute a default) thereunder.
(b) Except for the Lease described in Section
8.15 of this Agreement, VOLT has delivered to TRIPLE-I prior to
the execution of this Agreement true and correct copies of all
Real Property Leases to which AUTOLOGIC, NEWCO, AIL or any VOLT
SUBSIDIARY is a party (including any amendments and renewal
letters).
3.20 Tangible Personal Property. AUTOLOGIC, the VOLT
SUBSIDIARIES and AIL is in possession of and has good title to,
or has valid leasehold interests in or valid rights under
Contract to use, all the tangible personal property used by each
of them in the operation of the Business and individually or in
the aggregate with other such property material to the Condition
of the Business. Except as set forth in Schedule 3.20, all the
tangible personal property is free and clear of all Liens and is
in all material respects in good working order and condition,
ordinary wear and tear excepted.
3.21 Intellectual Property Rights. Schedule 3.21
discloses all Intellectual Property used in the operation of the
-27-
Business and individually or in the aggregate with other such
Intellectual Property material to the Condition of the Business,
each of which one or more of AUTOLOGIC, NEWCO, the VOLT
SUBSIDIARIES or AIL, either has all right, title and interest in
or a valid and binding right under Contract to use. Except as
disclosed in Schedule 3.21, (i) all registrations with and
applications to Governmental or Regulatory Authorities in respect
of Intellectual Property owned by one or more of AUTOLOGIC,
NEWCO, AIL or the VOLT SUBSIDIARIES and disclosed in Schedule
3.21 are valid and in full force and effect, (ii) there are no
restrictions on the direct or indirect transfer of any material
Contract, or any interest therein, held by AUTOLOGIC, NEWCO, AIL
or the VOLT SUBSIDIARIES in respect of such Intellectual
Property, (iii) to the Knowledge of VOLT, AUTOLOGIC, NEWCO, AIL
and the VOLT SUBSIDIARIES, none of AUTOLOGIC, NEWCO, the VOLT
SUBSIDIARIES or AIL is, nor has any of them received any notice
that it is, in default (or with the giving of notice or lapse of
time or both, would be in default) in any material respect under
any Contract to use such Intellectual Property and (iv) to the
Knowledge of VOLT, AUTOLOGIC, NEWCO, the VOLT SUBSIDIARIES and
AIL such Intellectual Property is not being infringed by any
other Person. Except as set forth in Schedule 3.21, none of
AUTOLOGIC, NEWCO, any VOLT SUBSIDIARY nor AIL has received notice
that it is infringing any Intellectual Property of any other
Person in connection with the conduct of the Business, to the
Knowledge of VOLT, AUTOLOGIC, NEWCO, AIL and the VOLT
-28-
SUBSIDIARIES no claim is pending or has been made to such effect
that has not been resolved and, to the Knowledge of VOLT,
AUTOLOGIC, NEWCO, AIL and VOLT SUBSIDIARIES, none of AUTOLOGIC,
NEWCO, any VOLT SUBSIDIARY nor AIL is infringing any Intellectual
Property of any other Person the effect of which, individually or
in the aggregate, could reasonably be expected to be materially
adverse to the Condition of the Business. In addition, Schedule
3.21 identifies each party whose consent is required to permit
the conveyance of any intellectual property described in such
Schedule.
3.22 Contracts.
(a) Schedule 3.22 contains a true and complete
list of each of the following Contracts (true and complete copies
or, if none, reasonably complete and accurate written
descriptions of which, together with all amendments and
supplements thereto, have been disclosed to TRIPLE-I prior to the
execution of this Agreement and are listed in Schedule 3.22) to
which one or more of AUTOLOGIC, NEWCO, any VOLT SUBSIDIARY or AIL
is a party or by which any of their Assets is bound:
(i) all Contracts (excluding Benefit Plans)
providing for a commitment of employment having a remaining
term of at least one year and requiring payments to any
individual of base salary in excess of $50,000 per year;
(ii) all Contracts (excluding Benefit Plans)
with any Person containing any provision or covenant
prohibiting or materially limiting the ability of AUTOLOGIC,
-29-
AIL or any VOLT SUBSIDIARY to engage in any business
activity or compete with any Person in connection with the
Business or prohibiting or materially limiting the ability
of any Person to compete with AUTOLOGIC, AIL or any VOLT
SUBSIDIARY in connection with the Business;
(iii) any agreement which by its terms
purports to create any partnership, joint venture or other
similar relationship with AUTOLOGIC, NEWCO, AIL or any VOLT
SUBSIDIARY;
(iv) all Contracts with distributors,
dealers, manufacturer's representatives, sales agencies or
franchises with whom AUTOLOGIC, NEWCO, any VOLT SUBSIDIARY
or AIL deals in connection with the Business which in any
case involve the payment or potential payment, pursuant to
the terms of any such Contract, by or to such other person
of more than $50,000 annually;
(v) all collective bargaining or similar
labor Contracts covering any Employee; and
(vi) all other Contracts (other than Benefit
Plans, the Real Property Leases and the insurance policies
disclosed elsewhere with respect to the Business and the
Contracts described in subparagraph (vii)) that (A) involve
the payment or potential payment, pursuant to the terms of
any such Contract, by or to AUTOLOGIC, NEWCO, AIL or any
VOLT SUBSIDIARY of more than $50,000 annually and (B) cannot
be terminated within two (2) years after giving notice of
-30-
termination without resulting in any material cost or
penalty to AUTOLOGIC, NEWCO, AIL or any VOLT SUBSIDIARY.
(vii) The following open customer
Contracts (i.e., such Contracts where systems or equipment
have not been shipped on or prior to September 29 1995):
(1) Master Agreement Contracts with
chains;
(2) Contracts with warranty terms of
more than 90 days in the U.S. or
more than 6 months overseas;
(3) Contracts with extended payment
terms (calling for payment of less
than 65% of the purchase price
within 30 days after shipment, or
permitting payment of 100% more
than 30 days after acceptance);
(4) Contracts giving discounts of more
than 15% below U.S. list price;
(5) Contracts with penalty or
liquidated damages clauses;
(6) Contracts containing software
licenses which permit unlimited
copying and use; and
(7) Contracts calling for the delivery
of products or features which have
-31-
not been developed as of the
Contract date.
(b) Each of the above Contracts is in full force
and effect and constitutes a legal, valid and binding agreement,
enforceable in accordance with its terms, of one or more of
AUTOLOGIC, NEWCO, a VOLT SUBSIDIARY or AIL and, to the Knowledge
of VOLT, AUTOLOGIC, NEWCO, AIL and the VOLT SUBSIDIARIES, of each
other party thereto; and except as disclosed elsewhere in this
Agreement none of AUTOLOGIC, any VOLT SUBSIDIARY or AIL, nor, to
the Knowledge of VOLT, AUTOLOGIC, NEWCO, the VOLT SUBSIDIARIES,
AIL, any other party to such Contract is in violation or breach
of or in default under any such Contract (or with notice or lapse
of time or both, would be in violation or breach of or in default
under any such Contract).
3.23 Licenses. Schedule 3.23 contains a true and
complete list of all Licenses used or held for use in and
individually or in the aggregate with other such Licenses
material to the Condition of the Business (and all pending
applications for any such Licenses), setting forth the grantor,
the grantee, the function and the expiration and renewal date of
each. Prior to the execution of this Agreement, VOLT has
delivered to TRIPLE-I true and complete copies of all such
Licenses. Except as disclosed in Schedule 3.23:
(a) One or more of AUTOLOGIC, NEWCO, a VOLT
SUBSIDIARY or AIL owns or validly holds all such Licenses;
-32-
(b) Each License is valid, binding and in full
force and effect; and
(c) To the Knowledge of VOLT, AUTOLOGIC, NEWCO,
AIL and the VOLT SUBSIDIARIES, none of NEWCO, AUTOLOGIC, any VOLT
SUBSIDIARY or AIL is in default (or with the giving of notice or
lapse of time or both, would be in default) under any License in
any material respect.
3.24 Insurance. Schedule 3.24 contains a true and
complete list of all material insurance policies currently in
effect that insure the Business, the employees or the Assets of
AUTOLOGIC, NEWCO, the VOLT SUBSIDIARIES and AIL, as the case may
be. Each such insurance policy is valid and binding and in full
force and effect, all premiums due thereunder have been paid and
none of VOLT, AUTOLOGIC, NEWCO, any VOLT SUBSIDIARY or AIL has
received any notice of cancellation or termination in respect of
any such policy or is in default thereunder in any material
respect.
3.25 Affiliate Transactions. Except as disclosed in
Schedule 3.25, (i) no officer, director, Affiliate or Associate
of AUTOLOGIC, of NEWCO, or of any VOLT SUBSIDIARY or of AIL or
any Associate of any such officer, director or Affiliate provides
or causes to be provided any assets, services or facilities used
or held for use in connection with the Business, and (ii) the
Business does not provide or cause to be provided any assets,
services or facilities to any such officer, director, Affiliate
or Associate. Except as disclosed in Schedule 3.25, each of the
-33-
transactions listed in Schedule 3.25 is engaged in on an arm's-
length basis.
3.26 Labor Relations. No Employee of AUTOLOGIC, NEWCO,
any VOLT SUBSIDIARY or AIL is presently a member of a collective
bargaining unit and no certification proceeding or representation
election is now ongoing or known by VOLT, AIL or the VOLT
SUBSIDIARIES to be planned.
3.27 Vehicles. Schedule 3.27 contains a true and
complete list of all motor vehicles owned or leased by AUTOLOGIC,
NEWCO, any VOLT SUBSIDIARY and AIL and used or held for use in
the conduct of the Business. Except as disclosed in Schedule
3.27, AUTOLOGIC, NEWCO, the VOLT SUBSIDIARIES and AIL have good
and valid title to, or have valid leasehold interests in or valid
rights under Contract to use, each such vehicle, free and clear
of all Liens other than Permitted Liens.
3.28 Assets Necessary for the Business. The Assets
(other than cash) owned by AUTOLOGIC, NEWCO, the VOLT
SUBSIDIARIES and AIL constitute sufficient assets to conduct the
Business substantially in the same manner as it is presently
conducted.
3.29 Brokers' and Finders' fees. There are no broker's
or finder's fees (other than fees payable to investment bankers)
payable by VOLT, AUTOLOGIC, NEWCO any VOLT SUBSIDIARY or AIL in
connection with the transactions contemplated herein.
3.30 Environmental Liabilities. There are no known or
threatened claims or liabilities of AUTOLOGIC, NEWCO, AIL or any
-34-
VOLT SUBSIDIARY (a) under foreign, state, federal or local laws
concerning or relating to pollution control, environmental
protection, health, welfare or public safety, (b) relating to the
handling, storage, use, delivery, sale, transportation or
disposal of any Hazardous Substance or (c) any escape, emission,
discharge, release or threat of release of any Hazardous
Substance into or upon soil, air, surface or ground water.
3.31 Foreign Control Regulations. As of the date of
the Closing, the business of VOLT, AUTOLOGIC, NEWCO, AIL and the
VOLT SUBSIDIARIES have each been conducted in conformance with
the Foreign Corrupt Practices Act and other U.S. foreign control
regulations and other laws and regulations with respect to the
conduct of business in non-US jurisdictions.
3.32 Export Control. AUTOLOGIC, NEWCO, AIL and the
VOLT SUBSIDIARIES have complied with applicable U.S. export
controls and regulations.
3.33 Disclosure.
(a) No representation or warranty of VOLT in this
Agreement omits to state a material fact necessary to make the
statements herein in light of the circumstances in which they
were made, not misleading.
(b) No notices, schedules or other documents
delivered by VOLT with respect to this Agreement shall contain
any untrue statement or omit to state a material fact necessary
to make the statements in this Agreement, in light of the
circumstances in which they were made, not misleading.
-35-
(c) There is no fact known to VOLT that has
specific application to any VOLT SUBSIDIARY, AUTOLOGIC, NEWCO,
or AIL (other than general economic or industry conditions) and
that materially adversely affects or, as far as VOLT can
reasonably foresee, materially threatens, the assets, business,
prospects, financial condition, or results of operations of the
VOLT SUBSIDIARIES, AUTOLOGIC, NEWCO, or AIL (on a consolidated
basis) that has not been set forth in this Agreement.
(d) Except as disclosed on Schedule 3.33 hereto,
VOLT has complied in all material respects with all reporting and
disclosure requirements applicable to it under Federal and State
Securities Laws.
3.34 No Material Adverse Change. Since the VOLT
Interim Financial Statement Date there has not been any material
adverse change in the business, operations, properties,
prospects, assets or conditions of NEWCO, AUTOLOGIC, AIL or any
of the VOLT SUBSIDIARIES, and no event has occurred or
circumstance exist that may result in such a material adverse
change.
ARTICLE IV - REPRESENTATIONS OF TRIPLE-I
TRIPLE-I represents and warrants to VOLT that, as of
the Closing Date:
4.1 Organization, Standing and Power of TRIPLE-I.
TRIPLE-I is a corporation duly organized, validly existing and in
good standing under the laws of the jurisdiction in which it is
-36-
incorporated and has the requisite corporate power and authority
to carry on its business as currently conducted.
4.2 TRIPLE-I Authority; Non-contravention. TRIPLE-I
has all requisite corporate power and authority to execute and
deliver this Agreement and to perform its obligations under this
Agreement. Except for the approval of shareholders, the
execution and delivery of, and the performance of its obligations
under this Agreement have been duly authorized by all necessary
corporate action of TRIPLE-I. TRIPLE-I has duly executed and
delivered this Agreement, and if approved by its shareholders,
this Agreement will be the legal, valid and binding obligation of
TRIPLE-I, enforceable in accordance with its terms, subject to
applicable bankruptcy, insolvency, reorganization, moratorium and
other laws generally applicable to creditors' rights and remedies
and to the exercise of judicial discretion in accordance with
general principles of equity. The execution and delivery by
TRIPLE-I of this Agreement does not, and the performance by
TRIPLE-I of its respective obligations under this Agreement and
the consummation of the transactions contemplated hereby will
not, violate, or conflict with or result (with or without the
giving of notice or the lapse of time or both) in the breach or
termination of, or default under, or result in the creation of
any material lien, security interest, charge or encumbrance upon
any of the properties or assets of TRIPLE-I under any provision
of (i) articles of organization or by-laws of TRIPLE-I or the
TRIPLE-I SUBSIDIARIES (as defined below) or of any law, rule or
-37-
regulation of any governmental body or any order, judgment or
decree applicable to any of them or any of their assets, or (ii)
any material loan or credit agreement, note, bond, lease,
license, franchise, mortgage, indenture or other agreement,
obligation or instrument to which TRIPLE-I or the TRIPLE-I
SUBSIDIARIES or VOLT is a party or by which any of them may be
bound or under which they enjoy any rights or privileges. Except
as provided in Schedule 4.2, no consent, approval, order or
authorization of, or registration, declaration or filing with,
any court, administrative agency or commission or other
governmental authority or agency, domestic or foreign, is
required by or with respect to TRIPLE-I in connection with the
execution and delivery of this Agreement by TRIPLE-I or the
consummation of the transactions contemplated hereby.
4.3 Capitalization of TRIPLE-I. The authorized
capital stock of TRIPLE-I consists of 9,000,000 shares of Common
Stock. All the Shares of TRIPLE-I are duly authorized, validly
issued, fully paid and nonassessable, and as of June 25, 1995,
2,405,620 shares of the authorized capital stock of TRIPLE-I are
issued and outstanding. Except as provided in this Agreement or
listed in Schedule 4.3, there are not outstanding any
subscriptions, options, warrants, conversion rights or other
agreements or commitments of any kind obligating TRIPLE-I
directly or indirectly, contingently or otherwise, to issue or
sell any shares of its capital stock or any securities
convertible into or exchangeable for any such shares, and no
-38-
authorization therefor has been given. Except as provided by
federal or state securities laws, TRIPLE-I's Shares are not
subject to any restrictions, contractual or otherwise, relating
to their disposition, nor to any right or obligation of TRIPLE-I
or any other person to purchase them.
4.4 Articles of Organization and By Laws. True and
correct copies of the Certificate of Incorporation and By Laws as
most recently amended and lists of officers and directors of
TRIPLE-I have been provided to VOLT by TRIPLE-I.
4.5 TRIPLE-I and TRIPLE-I Subsidiaries Organization,
Standing and Power. Xitron, Inc., Information International
Inc., S.A., Information International Foreign Sales Corporation,
Information International Inc., Limited and Information
International Overseas Corporation (hereinafter referred to as
the "TRIPLE-I SUBSIDIARIES") and TRIPLE-I, are each a
corporation, limited company or societe anonyme, as listed, is
duly incorporated or organized, as the case may be, validly
existing and in good standing under the laws of the jurisdiction
in which it is organized and each has the requisite corporate
power and authority to carry on its business as currently
conducted. The TRIPLE-I SUBSIDIARIES are each duly qualified or
licensed to do business and in good standing in each jurisdiction
where the nature of its business or the character of the
properties owned or leased by it makes such qualification or
licensing necessary, except where the failure to be so qualified
or licensed would not have a material adverse effect on the
-39-
assets, operations, business or financial condition of the
TRIPLE-I SUBSIDIARIES. The minute books of the TRIPLE-I and
TRIPLE-I SUBSIDIARIES, which TRIPLE-I has caused to be made
available to VOLT for inspection, correctly reflect all actions
taken by the stockholders, directors or managing agents of each
TRIPLE-I Subsidiary.
4.6 Capitalization of TRIPLE-I Subsidiaries. The
authorized capital stock of each TRIPLE-I SUBSIDIARY consists of
the following:
Subsidiary Shares of Common Stock
Xitron, Inc. 500,000
Information International Inc., S.A. 80,000
Information International Foreign
Sales Corporation 1,000
Information International Inc., Limited 100
Information International Overseas Corporation 75,000
TRIPLE-I is the beneficial and (except as listed on Schedule 4.6)
the record owner of all of the Shares of the TRIPLE-I
SUBSIDIARIES, in each case free and clear of any lien, claim,
charge or encumbrance of any kind. All the Shares of the TRIPLE-
I SUBSIDIARIES are duly authorized, validly issued, fully paid
and nonassessable, and immediately prior to the Closing, the
following shares of the authorized capital stock of the TRIPLE-I
SUBSIDIARIES are issued and outstanding:
Subsidiary Outstanding Shares
Xitron, Inc. 352,300
-40-
Information International Inc., S.A. 80,000
Information International Foreign
Sales Corporation 1,000
Information International Inc., Limited 100
Information International Overseas
Corporation 2,500
There are not outstanding any subscriptions, options, warrants,
conversion rights or other agreements or commitments of any kind
obligating the TRIPLE-I SUBSIDIARIES or TRIPLE-I, directly or
indirectly, contingently or otherwise, to issue or sell any
shares of the TRIPLE-I SUBSIDIARIES' capital stock or any
securities convertible into or exchangeable for any such shares,
and no authorization therefor has been given. Except as provided
by federal or state securities laws, the TRIPLE-I SUBSIDIARIES
shares are not subject to any restrictions, contractual or
otherwise, relating to their disposition, nor to any right or
obligation of TRIPLE-I SUBSIDIARIES or any other person to
purchase them.
4.7 Subsidiaries' Articles of Organization and By
Laws. True and correct copies of the Articles of Organization
and By Laws or all equivalent charter documents under the
jurisdiction of each of the TRIPLE-I SUBSIDIARIES as most
recently amended, share issuance and ownership records and lists
of officers and directors of the TRIPLE-I SUBSIDIARIES have been
provided to VOLT by TRIPLE-I.
-41-
4.8 No Other TRIPLE-I Subsidiaries. Except for the
merger of Camex, Inc. and Digiflex, Inc. (formerly Docupro, Inc.)
into TRIPLE-I, and as set forth on Schedule 4.8 hereto, any other
prior subsidiary of TRIPLE-I has been properly and duly dissolved
prior to the Closing Date and there have been no transfers,
distributions or dividends to TRIPLE-I by any subsidiary in
liquidation or during the ownership of TRIPLE-I by a TRIPLE-I
SUBSIDIARY which would render TRIPLE-I liable for any debt of a
subsidiary.
4.9 Governmental Approvals and Filings. Except as
listed hereafter, no consent, approval of action, filing with or
notice to any Governmental or Regulatory Authority on the part of
TRIPLE-I, or any TRIPLE-I SUBSIDIARY, is required in connection
with the execution, delivery and performance of this Agreement
and the consummation of the transactions contemplated hereby or
thereby:
(a) The expiration of the Xxxx Xxxxx Xxxxxx
Antitrust Improvement Act, 15 U.S.C. Section 18a, waiting period
(whether or not extended), without receipt by either party hereto
of an objection from the United States Justice Department or the
Federal Trade Commission, after the filing by both parties of a
completed Xxxx Xxxxx Xxxxxx pre-merger notification form and
payment by each of the required fee.
(b) The notification, not less than twenty days
before the Closing, of the French Treasury, of the transaction,
-42-
and specifically that as a result of the planned merger of NEWCO
and AUTOLOGIC, NEWCO would become the sole shareholder of AIL.
(c) The filing promptly after the execution of
this Agreement of a notification with the German Federal Cartel
Office pursuant to Section 23.24 of the German Act Against
Restraints of Competition.
(d) The notification, prior to or within 30 days
of the Closing, of the transaction to Investment Canada pursuant
to the Investment Canada Act.
(e) The notification at least 45 days before the
Closing of the Australian Foreign Investment Board under the
Foreign Acquisitions and Takeovers Act of this transaction and
that, as a result thereof, TRIPLE-I would become the sole
shareholder of VAPL, and the passage of the waiting period
thereunder without objection or the imposition of conditions.
(f) The obtaining of tax clearance from the State
of California for the merger provided in Section 5.1(d).
(g) The filing and effectiveness of the
Registration Statement on Form S-4 as described in Section 7.11
of this Agreement and applicable Blue Sky Filings, and filings
pursuant to the Exchange Act.
4.10 Financial Statements and Condition.
(a) Prior to the execution of this Agreement,
TRIPLE-I has delivered to VOLT true and complete copies of the
following consolidated financial statements of TRIPLE-I and the
TRIPLE-I SUBSIDIARIES: (i) audited consolidated balance sheets
-43-
for the annual periods ended December 31, 1994, December 31, 1993
(8 months) and April 30, 1993 (accompanied by the unqualified
independent accountants' audit reports); (ii) audited
consolidated statements of operations and cash flow for the
annual periods ended December 31, 1994, December 31, 1993 (8
months), April 30, 1993 and April 30, 1992 (accompanied by the
unqualified independent accountants' audit reports) ((i) and (ii)
together are hereinafter referred to as the "TRIPLE-I Annual
Financial Statements"); (iii) unaudited interim condensed
consolidated balance sheets and statements of operations and cash
flows for the six month period ended June 30, 1995 (accompanied
by an unqualified independent accountants' review report) ((iii)
is hereinafter referred to as the "TRIPLE-I Interim Financial
Statements" and, together with the TRIPLE-I Annual Financial
Statements are hereinafter referred to as the "TRIPLE-I Financial
Statements; and June 30, 1995, is hereinafter referred to as the
"TRIPLE-I Interim Financial Statement Date"). All the TRIPLE-I
Financial Statements were prepared from the Books and Records of
TRIPLE-I in accordance with GAAP and fairly present in all
material respects the consolidated financial condition and
results of operations of TRIPLE-I and the TRIPLE-I SUBSIDIARIES
as of the respective dates thereof and for the respective periods
covered thereby.
(b) Except for the execution and delivery of this
Agreement, the transactions to take place pursuant hereto on or
prior to the Closing Date and the transactions listed on Schedule
-44-
4.10 since December 31, 1994, (i) there has not been any material
adverse change in the Condition of the Business, other than those
occurring as a result of general economic or financial conditions
or other developments which are not unique to the Business but
also affect other Persons who participate or are engaged in lines
of business similar to the Business and (ii) the Business has
been operated in the ordinary course, consistent with past
practice; and (iii) there have been no out of the ordinary course
of business transactions not disclosed to VOLT.
(c) Since the TRIPLE-I Interim Financial
Statement Date, TRIPLE-I and the TRIPLE-I SUBSIDIARIES have
incurred no Liabilities, other than Liabilities incurred in the
ordinary course of business, except for those expenses incurred
with respect to the TRIPLE-I/NEWCO Merger.
(d) Except for trade debt incurred in the
ordinary course of business, TRIPLE-I and the TRIPLE-I
SUBSIDIARIES are debt free.
(e) As at the TRIPLE-I Interim Financial
Statement Date there were no Liabilities of TRIPLE-I other than
Liabilities that are reflected, accrued or reserved against on
the TRIPLE-I Interim Financial Statements (for which the reserves
were appropriate and reasonable) and there will be on the Closing
Date no Liabilities other than (i) those Liabilities which were
reflected in the TRIPLE-I Interim Financial Statements which have
not been paid or discharged and (ii) those Liabilities incurred
-45-
in the ordinary course of business and consistent with past
practices since the TRIPLE-I Interim Financial Statement Date.
4.11 Taxes.
(a) TRIPLE-I has paid or will timely pay all
Federal income taxes due and payable by TRIPLE-I or the TRIPLE-I
SUBSIDIARIES that are attributable to any Pre-Closing Tax Period.
(b) TRIPLE-I has paid or will cause to be paid
all foreign, state and local income taxes and sales and use,
transfer, value added, excise and other taxes due and payable by
TRIPLE-I or any of the TRIPLE-I SUBSIDIARIES which were incurred
and payable prior to the Closing Date.
4.12 Legal Proceedings. Except as disclosed in
Schedule 4.12:
(a) There are no Actions or Proceedings Pending
or, to the Knowledge of TRIPLE-I, threatened against, relating to
or affecting TRIPLE-I or any TRIPLE-I SUBSIDIARY with respect to
the Business or any of its Assets and Properties; and
(b) There are no Orders outstanding against
TRIPLE-I or any TRIPLE-I SUBSIDIARY.
4.13 Compliance With Laws and Orders. Neither TRIPLE-I
nor any TRIPLE-I SUBSIDIARY is in violation of or in default
under any Law or Order applicable to the Business or the Assets
the effect of which, individually or in the aggregate with other
such violations and defaults, could reasonably be expected to be
materially adverse to the Condition of the Business.
-46-
4.14 Employee Benefit Plans.
(a) Except as listed on Schedule 4.14, TRIPLE-I
and TRIPLE-I SUBSIDIARIES have no benefit plan nor defined
contribution plan, stock ownership plan, executive compensation
plan, bonus plan, incentive compensation plan or any arrangement,
deferred compensation agreement or arrangement, employment,
termination or retention contract, agreement or arrangement,
vacation pay, medical, dental, disability or death benefit plan
(whether provided through insurance, on a funded or unfunded
basis or otherwise), employee stock option or stock purchase
plan, severance pay plan, and any other employee benefit plan,
program, arrangement, agreement or policy including, without
limitation, each "employee benefit plan" within the meaning of
Section 3(3) of ERISA, which is maintained or contributed to
TRIPLE-I, or TRIPLE-I SUBSIDIARIES' for the benefit of, or
relating to, TRIPLE-I'S or TRIPLE-I SUBSIDIARIES' current or
former employees or their dependents, survivors or beneficiaries
(all of which are hereinafter referred to as the "Benefit
Plans"). TRIPLE-I has made available to VOLT a true and complete
copy of (i) the most recent annual report (Form 5500) filed with
the IRS, (ii) each such Benefit Plan, (iii) if applicable, each
trust agreement relating to each such Benefit Plan, (iv) the most
recent summary plan description for each Benefit Plan for which a
summary plan description is required and (v) the most recent
determination letter, if any, issued by the IRS with respect to
-47-
any Benefit Plan qualified under Section 401(a) of the Internal
Revenue Code.
(b) To the Knowledge of TRIPLE-I, there have been
no "prohibited transactions" within the meaning of Section 4975
of the Code or Section 406 of ERISA with respect to any Benefit
Plan of TRIPLE-I or TRIPLE-I SUBSIDIARIES that could result in a
material adverse effect on the Condition of the Business. There
is no pending or threatened assessment, complaint proceeding, or
investigation of any kind in any court or government agency with
respect to any employee benefit plan of TRIPLE-I or TRIPLE-I
SUBSIDIARIES. Aside from routine claims for benefits, there are
no disputes or threatened disputes of any kind with participants
or beneficiaries relating to any Benefit Plan.
(c) Each of the Benefit Plans, and its
administration,
are in compliance with its material terms, federal, state,
foreign or provincial laws, and the requirements of ERISA and the
Code, except for such failures which, individually or in the
aggregate, could not reasonably be expected to have a material
adverse effect on the Condition of the Business.
(d) All contributions and other payments required
to be made by TRIPLE-I or any TRIPLE-I SUBSIDIARY to any Benefit
Plan with respect to any period ending before or at or including
the Closing Date have been made and, to the extent made or
reserved for prior to the date of the TRIPLE-I Interim Financial
-48-
Statements, have been reflected in the TRIPLE-I Interim Financial
Statements in accordance with GAAP.
(e) Neither TRIPLE-I nor any member of TRIPLE-I's
controlled group, within the meaning of Section 414 of the Code,
has ever contributed or is currently obligated to contribute to
any multiemployer plan (as defined in Section 4001(a)(3) of
ERISA) on behalf of TRIPLE-I's or TRIPLE-I's SUBSIDIARIES current
or former employees, and no withdrawal liability is due or owing
in respect of any such multiemployer plan by TRIPLE-I or the
TRIPLE-I SUBSIDIARIES or any member of TRIPLE-I's controlled
group (as so defined). Neither TRIPLE-I, nor any member of
TRIPLE-I's controlled group has ever maintained a Benefit Plan
providing retiree medical benefits.
(f) Each Welfare Plan that is a "group health
plan," as defined in Section 607(1) of ERISA, and each "group
health plan" (as so defined) of any ERISA Affiliate has, to the
knowledge of TRIPLE-I, been operated, in all meaningful respects,
in compliance with the provisions of Part 6 of Title I of ERISA
and Section 162(k) (prior to its amendment in 1988) and 4980B of
the Internal Revenue Code at all times. For purposes of this
paragraph, "Welfare Plan" means any employee welfare benefit plan
as defined in Section 3(1) of ERISA.
(g) With respect to the Benefit Plans, no event
has occurred and, to the knowledge of the Seller, there exists no
condition or set of circumstances, in connection with TRIPLE-I or
any TRIPLE-I SUBSIDIARY which could be subject to any liability
-49-
which has, when taken together with all such other liabilities
hereunder, material adverse effect on the Condition of the
Business under the terms of such Benefit Plans, ERISA, the
Internal Revenue Code or any other applicable Law. No Benefit
Plan is subject to Title IV of ERISA.
4.15 Real Property.
(a) TRIPLE-I and the TRIPLE-I SUBSIDIARIES have
valid and subsisting leasehold estate in and the right to quiet
enjoyment of the real properties they presently occupy listed in
Schedule 4.15. Each Real Property Lease is a legal, valid and
binding agreement, enforceable in accordance with its terms and
to the Knowledge of TRIPLE -I and the TRIPLE-I SUBSIDIARIES and,
to the Knowledge of TRIPLE-I, of each other Person that is a
party thereto, and, to the Knowledge of TRIPLE-I, there is no
default (or any condition or event which, after notice or lapse
of time or both, would constitute a default) thereunder.
(b) TRIPLE-I has delivered to VOLT prior to the
execution of this Agreement true and correct copies of all Real
Property Leases to which TRIPLE-I or any TRIPLE-I SUBSIDIARY is a
party (including any amendments and renewal letters). Upon the
Closing, except as listed in Schedule 4.15, each such Real
Property Lease shall continue to be valid and shall remain in
effect, and all landlord consents required under each such Real
Property Lease shall have been obtained.
4.16 Tangible Personal Property. TRIPLE-I and each
TRIPLE-I SUBSIDIARY is in possession of and has good title to, or
-50-
has valid leasehold interests in or valid rights under Contract
to use, all the tangible personal property used by each of them
in the operation of the Business and individually or in the
aggregate with other such property material to the Condition of
the Business. Except as set forth in Schedule 4.16, all the
tangible personal property is free and clear of all Liens and is
in all material respects in good working order and condition,
ordinary wear and tear excepted.
4.17 Intellectual Property Rights. Schedule 4.17
discloses all Intellectual Property used in the operation of the
Business and individually or in the aggregate with other such
Intellectual Property material to the Condition of the Business,
each of which one or more of TRIPLE-I or the TRIPLE-I
SUBSIDIARIES either has all right, title and interest in or a
valid and binding right under Contract to use. Except as
disclosed in Schedule 4.17, (i) all registrations with and
applications to Governmental or Regulatory Authorities in respect
of Intellectual Property owned by one or more of TRIPLE-I or the
TRIPLE-I SUBSIDIARIES and disclosed in Schedule 4.17 are valid
and in full force and effect, (ii) there are no restrictions on
the direct or indirect transfer of any material Contract, or any
interest therein, held by TRIPLE-I or the TRIPLE-I SUBSIDIARIES
in respect of such Intellectual Property, (iii) to the Knowledge
of TRIPLE-I and the TRIPLE-I SUBSIDIARIES, neither TRIPLE-I nor
any TRIPLE-I SUBSIDIARY is, nor has any of them received any
notice that it is, in default (or with the giving of notice or
-51-
lapse of time or both, would be in default) in any material
respect under any Contract to use such Intellectual Property and
(iv) to the Knowledge of TRIPLE-I and the TRIPLE-I SUBSIDIARIES,
such Intellectual Property is not being infringed by any other
Person. Neither TRIPLE-I nor any TRIPLE-I SUBSIDIARY has
received notice that it is infringing any Intellectual Property
of any other Person in connection with the conduct of the
Business, to the Knowledge of TRIPLE-I no claim is pending or has
been made to such effect that has not been resolved and, to the
Knowledge of TRIPLE-I, neither TRIPLE-I nor any TRIPLE-I
SUBSIDIARY is infringing any Intellectual Property of any other
Person the effect of which, individually or in the aggregate,
could reasonably be expected to be materially adverse to the
Condition of the Business. In addition, Schedule 4.17 identifies
each party whose consent is required to permit the conveyance of
any Intellectual Property described on such Schedule.
4.18 Contracts.
(a) Schedule 4.18 contains a true and complete
list of each of the following Contracts (true and complete copies
or, if none, reasonably complete and accurate written
descriptions of which, together with all amendments and
supplements thereto, have been disclosed to VOLT prior to the
execution of this Agreement and are listed in Schedule 4.18) to
which one or more of TRIPLE-I or any TRIPLE-I SUBSIDIARY is a
party or by which any of their Assets is bound:
-52-
(i) all Contracts (excluding Benefit Plans)
providing for a commitment of employment having a remaining
term of at least one year and requiring payments to any
individual of base salary in excess of $50,000 per year;
(ii) all Contracts (excluding Benefit Plans)
with any Person containing any provision or covenant
prohibiting or materially limiting the ability of TRIPLE-I
or any TRIPLE-I SUBSIDIARY to engage in any business
activity or compete with any Person in connection with the
Business or prohibiting or materially limiting the ability
of any Person to compete with TRIPLE-I or any TRIPLE-I
SUBSIDIARY in connection with the Business;
(iii) any agreement which by its terms
purports to create any partnership, joint venture or other
similar relationship;
(iv) all Contracts with distributors,
dealers, manufacturer's representatives, sales agencies or
franchises with whom TRIPLE-I or any TRIPLE-I SUBSIDIARY
deals in connection with the Business which in any case
involve the payment or potential payment, pursuant to the
terms of any such Contract, by or to such other person of
more than $50,000 annually;
(v) all collective bargaining or similar
labor Contracts covering any Employee; and
(vi) all other Contracts (other than Benefit
Plans, the Real Property Leases and the insurance policies
-53-
disclosed elsewhere with respect to the Business and the
Contracts described in subparagraph (vii)) that (A) involve
the payment or potential payment, pursuant to the terms of
any such Contract, by or to TRIPLE-I or any TRIPLE-I
SUBSIDIARY of more than $50,000 annually and (B) cannot be
terminated within two (2) years after giving notice of
termination without resulting in any material cost or
penalty to TRIPLE-I or any TRIPLE-I SUBSIDIARY.
(vii) The following open customer
Contracts (i.e., such Contracts where systems or equipment
have not been shipped on or prior to September 29, 1995).
(1) Master Agreement Contracts with
chains;
(2) Contracts with warranty terms of
more than 90 days in the U.S. or
more than 6 months overseas;
(3) Contracts with extended payment
terms (calling for payment of less
than 65% of the purchase price
within 30 days after shipment; or
permitting payment of 100% more
than 30 days after acceptance);
(4) Contracts giving discounts of more
than 15% below U.S. list price;
(5) Contracts with penalty or
liquidated damages clauses;
-54-
(6) Contracts containing software
licenses which permit unlimited
copying and use; and
(7) Contracts calling for the delivery
of products or features which have
not been developed as of the
Contract date.
(b) Each of the above Contracts is in full force
and effect and constitutes a legal, valid and binding agreement,
enforceable in accordance with its terms, of one or more of
TRIPLE-I or a TRIPLE-I SUBSIDIARY and, to the Knowledge of
TRIPLE-I, of each other party thereto; and except as disclosed
neither TRIPLE-I nor any TRIPLE-I SUBSIDIARY, nor, to the
Knowledge of TRIPLE-I, any other party to such Contract is in
violation or breach of or in default under any such Contract (or
with notice or lapse of time or both, would be in violation or
breach of or in default under any such Contract).
4.19 Licenses. Schedule 4.19 contains a true and
complete list of all Licenses used or held for use in and
individually or in the aggregate with other such Licenses
material to the Condition of the Business (and all pending
applications for any such Licenses), setting forth the grantor,
the grantee, the function and the expiration and renewal date of
each. Prior to the execution of this Agreement, TRIPLE-I has
delivered to VOLT true and complete copies of all such Licenses.
Except as disclosed in Schedule 4.19:
-55-
(a) One or more of TRIPLE-I or a TRIPLE-I
SUBSIDIARY owns or validly holds all such Licenses;
(b) Each License is valid, binding and in full
force and effect; and
(c) To the Knowledge of TRIPLE-I, neither TRIPLE-
I nor any TRIPLE-I SUBSIDIARY is in default (or with the
giving of notice or lapse of time or both, would be in
default) under any License in any material respect.
4.20 Insurance. Schedule 4.20 contains a true and
complete list of all material insurance policies currently in
effect that insure the Business, the employees or the Assets of
TRIPLE-I and the TRIPLE-I SUBSIDIARIES, as the case may be. Each
such insurance policy is valid and binding and in full force and
effect, all premiums due thereunder have been paid and neither
TRIPLE-I nor any TRIPLE-I SUBSIDIARY has received any notice of
cancellation or termination in respect of any such policy or is
in default thereunder in any material respect.
4.21 Affiliate Transactions. Except as disclosed in
Schedule 4.21, (a) no officer, director, Affiliate or Associate
of TRIPLE-I or any TRIPLE-I SUBSIDIARY or any Associate of any
such officer, director or Affiliate provides or causes to be
provided any assets, services or facilities used or held for use
in connection with the Business, and (b) the Business does not
provide or cause to be provided any assets, services or
facilities to any such officer, director, Affiliate or Associate.
-56-
Except as disclosed in Schedule 4.21, each of the transactions
listed in Schedule 4.21 is engaged in on an arm's-length basis.
4.22 Labor Relations. No Employee of TRIPLE-I or any
TRIPLE-I SUBSIDIARY is presently a member of a collective
bargaining unit and no certification proceeding or representation
election is now ongoing or known to be planned by TRIPLE-I or any
TRIPLE-I SUBSIDIARY.
4.23 Vehicles. Schedule 4.23 contains a true and
complete list of all motor vehicles owned or leased by TRIPLE-I
or any TRIPLE-I SUBSIDIARY and used or held for use in the
conduct of the Business. Except as disclosed in Schedule 4.23,
TRIPLE-I and the TRIPLE-I SUBSIDIARIES have good and valid title
to, or have valid leasehold interests in or valid rights under
Contract to use, each such vehicle, free and clear of all Liens
other than Permitted Liens.
4.24 Assets Necessary for the Business. The Assets
owned by TRIPLE-I and the TRIPLE-I SUBSIDIARIES constitute
sufficient assets to conduct the Business substantially in the
same manner as it is presently conducted.
4.25 Brokers' and Finders' fees. There are no broker's
or finder's fees (other than fees payable to investment bankers)
payable by TRIPLE-I or the TRIPLE-I SUBSIDIARIES connection with
the transactions contemplated herein.
4.26 Environmental Liabilities. There are no known or
threatened claims or liabilities of TRIPLE-I or any TRIPLE-I
SUBSIDIARY (a) under foreign, state, federal or local laws
-57-
concerning or relating to pollution control, environmental
protection, health, welfare or public safety, (b) relating to the
handling, storage, use, delivery, sale, transportation or
disposal of any Hazardous Substance or (c) any escape, emission,
discharge, release or threat of release of any Hazardous
Substance into or upon soil, air, surface or ground water.
4.27 Foreign Control Regulations. As of the date of
the Closing, the business of TRIPLE-I and the TRIPLE-I
SUBSIDIARIES have each been conducted in conformance with the
Foreign Corrupt Practices Act and other U.S. foreign control
regulations and other laws and regulations with respect to the
conduct of business in non-US jurisdictions.
4.28 Export Control. TRIPLE-I and the TRIPLE-I
SUBSIDIARIES have complied with applicable U.S. export controls
and regulations.
4.29 Disclosure.
(a) No representation or warranty of TRIPLE-I in
this Agreement omits to state a material fact necessary to make
the statements herein in light of the circumstances in which they
were made, not misleading.
(b) No notices, schedules or other documents
delivered by TRIPLE-I with respect to this Agreement shall
contain any untrue statement or omit to state a material fact
necessary to make the statements in this Agreement, in light of
the circumstances in which they were made, not misleading.
-58-
(c) There is no fact known to TRIPLE-I that has
specific application to either TRIPLE-I or any TRIPLE-I
SUBSIDIARY (other than general economic or industry conditions)
and that materially adversely affects or, as far as TRIPLE-I can
reasonably foresee, materially threatens, the assets, business,
prospects, financial condition, or results of operations of
TRIPLE-I or any of the TRIPLE-I SUBSIDIARIES (on a consolidated
basis) that has not been set forth in this Agreement.
(d) Except as disclosed on Schedule 4.29 hereto,
TRIPLE-I has complied in all material respects with all reporting
and disclosure requirements applicable to it under Federal and
State Securities Laws.
4.30 No Material Adverse Change. Since the date of the
TRIPLE-I Interim Financial Statements there has not been any
material adverse change in the business, operations, properties,
prospects, assets or conditions of TRIPLE-I or any of the TRIPLE-
I SUBSIDIARIES, and no event has occurred or circumstances exist
that may result in such a material adverse change.
ARTICLE V - AGREEMENTS OF VOLT
5.1 Merger of Autologic into NEWCO and Related
Corporate Action. No later than immediately prior to the
Closing, VOLT agrees that it shall cause the following actions to
occur:
-59-
(a) VOLT, as sole shareholder of NEWCO, shall
cause the Certificate of Incorporation of NEWCO to read as set
forth in Exhibit A.
(b) The Board of Directors of NEWCO shall have
adopted or amended NEWCO's by-laws to read as set forth in
Exhibit B.
(c) The Boards of Directors of AUTOLOGIC and
NEWCO shall adopt and implement the Agreement of Merger (the
"AUTOLOGIC/NEWCO Merger") and file with the Secretaries of State
of Delaware and California the appropriate Certificate of Merger
.
5.2 Documents to be delivered at the Closing. VOLT
shall, at the Closing, deliver to TRIPLE-I:
(a) An opinion letter of counsel dated as of the
date of Closing to the effect that VOLT, NEWCO, the VOLT
SUBSIDIARIES and AIL are each duly organized, validly existing
and in good standing under the laws of the jurisdiction in which
they are organized, and have full corporate power to own their
properties and carry on business as now being conducted and, as
to VOLT and NEWCO, to execute, deliver and perform this
Agreement; that neither the execution, delivery or performance of
this Agreement, nor the consummation of transactions contemplated
by this Agreement, violates any provision of VOLT's, NEWCO's,
AUTOLOGIC's , the VOLT SUBSIDIARIES' or AIL's Certificates of
Incorporation, By Laws or other such organizing document, or any
law, regulation, order, judgment or decree by which any of them
-60-
may be bound; or conflict with or result in a breach of the terms
and conditions or constitute a default, under any agreement,
known to such counsel, and to which any of them is a party; and
that all necessary corporate proceedings to authorize the
transactions contemplated by this Agreement, the performance by
them of their obligations thereunder, and the execution and
delivery by VOLT and NEWCO of this Agreement have been taken;
provided, however, that in providing such opinion letter, counsel
shall (i) include such other opinions with respect to any other
matters related to the transactions contemplated by this
Agreement as TRIPLE-I or its counsel may reasonably request, and
(ii) be entitled to rely on certificates provided by any officers
of VOLT, AUTOLOGIC, NEWCO, the VOLT SUBSIDIARIES or AIL and shall
be entitled to rely on any opinion provided by local or any other
counsel to VOLT, AUTOLOGIC, NEWCO, the VOLT SUBSIDIARIES or AIL.
(b) A certificate of the duly authorized Chief
Financial Officer of VOLT and the President of AUTOLOGIC dated as
of the Closing confirming the accuracy of the representations and
warranties of VOLT contained in this Agreement and that VOLT has
performed all covenants and agreements herein and is not in
default hereunder.
(c) Certificates issued by appropriate
governmental authorities or other documentation reasonably
satisfactory to counsel for TRIPLE-I evidencing the good standing
of NEWCO as of a date not more than twenty (20) days prior to the
Closing Date as a corporation under the laws of the State of
-61-
Delaware and as a foreign corporation under the laws of every
jurisdiction in which NEWCO has qualified to do business as a
foreign corporation.
(d) The Shareholders Stock Voting Agreement
attached hereto as Exhibit C, executed by VOLT.
(e) VOLT shall deliver executed resignations of
all the officers and directors of NEWCO, to be effective on the
filing of Articles of Merger between TRIPLE-I and NEWCO with the
Secretary of State of Delaware.
(f) A certification by VOLT that the obligation
under Section 5.5 has been satisfied.
(g) Certified resolutions of the VOLT Board of
Directors pursuant to Section 8.16 hereof.
5.3 Good Will. The parties agree that good will on
the books of AUTOLOGIC and/or NEWCO prior to Closing shall not
be written off in less than two years from the Closing, unless
required by GAAP.
5.4 Autologic Name. After the Closing, VOLT and any
of its remaining subsidiaries will not use the name "Autologic"
or any variation thereof without the written permission of NEWCO.
5.5 Intercompany Advances. Prior to the Closing, and
following consultation with TRIPLE-I, all intercompany payables
to VOLT by NEWCO, AUTOLOGIC, AIL or the VOLT SUBSIDIARIES shall
be contributed to the capital of the respective entities in such
manner as will permanently extinguish such payables.
5.6 Stock Option Plans.
-62-
(a) Effective on the merger of TRIPLE-I into
NEWCO, NEWCO shall assume, adopt and continue the Information
International, Inc. 1976 Employees' Incentive Stock Option Plan
(the "1976 Incentive Plan") and the Information International,
Inc. Directors' Stock Option Plan (the "Directors' Plan") on the
same terms and conditions as provided under the provisions of
those plans as currently in effect and in accordance with Section
10(iii) of the 1976 Incentive Plan and Section 10(iii) of the
Directors' Plan, and all options currently outstanding under
those plans shall remain outstanding for the balance of their
original full option periods. The Board of Directors of NEWCO
shall permit existing option holders under the 1976 Incentive
Plan and the Directors' Plan to exercise their outstanding
options pursuant to and in accordance with the terms of those
plans, as in effect prior to the Closing Date, but recognizing
the acceleration of the vesting of options provided for therein,
as a consequence of the TRIPLE-I/NEWCO Merger, shall further
provide that upon exercise, each option holder shall be entitled
to receive one share of NEWCO stock for each share of TRIPLE-I
stock provided for in such holders' options pursuant to the 1976
Incentive Plan or the Directors' Plan. Existing option holders
shall be notified of such provisions.
(b) At or prior to the Closing, NEWCO shall adopt
and VOLT as sole shareholder of NEWCO shall approve (i) the NEWCO
1995 Employees' Incentive Stock Option Plan, (the "1995 Incentive
Plan"), effective on the Closing Date, which shall qualify as an
-63-
"incentive stock option plan" within the meaning of Section 422
of the Internal Revenue Code (the "Code"), and (ii) the NEWCO
1995 Directors' Stock Option Plan, (the "1995 Directors' Plan"),
effective on the Closing Date, which 1995 Directors' Plan shall
not qualify as an "incentive stock option plan" within the
meaning of Section 422 of the Code. Such plans shall limit the
number of shares to be issued upon the exercise of options
granted thereunder to an aggregate of 150,000 shares of NEWCO
Common Stock,
5.7 Cash Distributions.
(a) TRIPLE-I agrees and acknowledges that, prior
to Closing, VOLT may cause AUTOLOGIC, NEWCO, AIL and/or the VOLT
SUBSIDIARIES to distribute cash on hand as dividends or, if
AUTOLOGIC, NEWCO, AIL and/or the VOLT SUBSIDIARIES, as the case
may be, is indebted to VOLT or any VOLT Affiliate, then such cash
may be distributed in full or partial satisfaction of such debts;
provided, however, that cash representing customer deposits and
prepayments received for goods and services to be delivered or
performed after the Closing Date (the "Deposits") shall not be so
distributed but remain with AUTOLOGIC, NEWCO, AIL and the VOLT
SUBSIDIARIES, as the circumstances may exist.
(b) VOLT agrees during the first two years
following the Closing Date, to provide NEWCO with credit
facilities (the "Credit Line") of $2,250,000, in such manner as
VOLT shall determine in its sole discretion, provided that any
such credit shall be extended at the prime rate of interest
-64-
charged by Chemical Bank at such time, and provided further that
NEWCO shall reimburse VOLT for all charges that are reasonably
related to such Credit Line and that shall be incurred by VOLT
with respect thereto.
(c) Anything in subparagraph (b) to the contrary
notwithstanding, VOLT agrees that, if the aggregate amount of the
Deposits as of the Closing Date is less than $2,500,000, then the
Credit Line shall be increased to the extent of the difference
between $2,500,000 and such actual aggregate amount of the
Deposits, but in no event shall the Credit Line exceed
$2,750,000.
5.8 Settlement of VOLT Intercompany Accounts. In the
event that, following the Closing, NEWCO, AUTOLOGIC, AIL or any
of the VOLT SUBSIDIARIES' books show any remaining accounts
payable to a VOLT affiliate, VOLT shall pay or cause to be
credited any such amount(s) unless the amount owed by one of
NEWCO, AUTOLOGIC, AIL or any of the VOLT SUBSIDIARIES is owed to
another one of such entities and would be eliminated in financial
statement consolidation..
ARTICLE VI - AGREEMENTS OF TRIPLE-I
6.1 Documents to be delivered at the Closing.
TRIPLE-I shall, at the Closing deliver to VOLT;
(a) An Opinion Letter of counsel dated as of the
date of Closing, to the effect that TRIPLE-I and the TRIPLE-I
SUBSIDIARIES are each, duly organized, validly existing and in
-65-
good standing under the laws of the jurisdictions in which they
are organized, and have full corporate power to own their
properties and carry on business as now being conducted and, as
to TRIPLE-I, to execute, deliver and perform this Agreement;
that neither the execution, delivery nor performance of this
Agreement nor the consummation of transactions contemplated by
this Agreement , violates any provision of TRIPLE-I's or TRIPLE-
I's SUBSIDIARIES Certificates of Incorporation or Bylaws or
other such organizing document; or any law, regulation, order,
judgment or decree by which any of them may be bound; or conflict
with or result in a breach of the terms and conditions or
constitute a default, under any agreement, known to such counsel,
and to which TRIPLE-I or TRIPLE-I's SUBSIDIARIES are a party; and
that all necessary corporate proceedings to authorize the
transactions contemplated by this Agreement, the performance by
TRIPLE-I of its obligations hereunder, and the execution and
delivery by TRIPLE-I of this Agreement and all instruments and
other documents contemplated hereby have been taken; provided,
however, that in providing such opinion letter, counsel shall (i)
include such other opinions with respect to any other matters
related to the transactions contemplated by this Agreement as
VOLT or its counsel may reasonably request and (ii) be entitled
to rely on certificates provided by any officer of TRIPLE-I and
the TRIPLE-I SUBSIDIARIES and shall be entitled to rely on any
opinion provided by local or any other counsel to TRIPLE-I and
the TRIPLE-I SUBSIDIARIES.
-66-
(b) A certificate of the duly authorized
President and CFO of TRIPLE-I dated as of the Closing Date
confirming the accuracy of the representations and warranties of
TRIPLE-I contained in this Agreement and that TRIPLE-I has
performed all covenants and agreements herein and is not in
default hereunder.
(c) The Shareholders Stock Voting Agreement
attached hereto as Exhibit C executed by the parties thereto;
(d) TRIPLE-I shall deliver executed resignations
of all the officers and directors of TRIPLE-I other than Xxxxx
Xxxx and Xxxxxxx Xxxx as directors, Xxxxx X. Xxxxxxx as President
and Xxxxxx Xxxxxxx as Secretary, Treasurer and Chief Financial
Officer, to be effective at the Effective Time.
(e) Certified resolutions of the TRIPLE-I Board
of Directors pursuant to Section 8.16 hereof.
6.2 Delaware G.C.L. Section 203. TRIPLE-I's Board of
Directors shall take all steps necessary to exempt the
transactions contemplated under this Agreement and the Exhibits
hereto from the provisions of its Certificate of Incorporation,
By-laws, Shareholders' Rights Agreement and Delaware General
Corporation Law Section 203.
6.3 France and U.K. Corporate Matters.
(a) TRIPLE-I shall cause one share of Information
International, Inc., S.A. ("TRIPLE-I S.A.") to be issued and
delivered to each of (i) Xxxxxxx X. Box, (ii) AIL, (iii)
Information International Inc., Limited, (iv) VOLT-Autologic,
-67-
Ltd. of England, (v) VOLT-Autologic, Ltd. of Israel, (vi) VOLT-
Autologic, Inc. of Canada, and (vii) VOLT-Autologic AB of Sweden;
provided, however that delivery of such shares shall be made to
NEWCO upon or prior to the Closing.
(b) "TRIPLE-I S.A. and the French branch of
Information International Inc., Limited (the "French Branch"),
will, prior to the Closing, perform the following acts:
(i) establish a final balance sheet for 1994
for the French Branch;
(ii) sign the annual tax returns for 1992,
1993, 1994 relating to the French
Branch;
(iii) file such tax returns with the
interested tax authorities, and
cause a meeting with the authorized
tax examiner to be held to explain
the situation and circumstances of
the French Branch;
(iv) file the 1994 accounts of TRIPLE-I S.A.
with the Registrar of Commerce and
Companies;
(v) carry out with the Registrar of Commerce
and Companies the formalities relating
to the change of the TRIPLE-I S.A.
statutory auditor; and
-68-
(vi) clarify the status of the two British
employees by making them "cadre"
(management personnel) like the other
employees of TRIPLE-I S.A."
ARTICLE VII - MUTUAL AGREEMENTS
7.1 Confidentiality And Non-Solicitation. Until the
Closing, and, in the event this Agreement is terminated by
Agreement or there is not a Closing, for two years after
termination:
(a) All parties and their respective Affiliates
shall keep confidential and shall not disclose nor use in their
respective businesses any confidential business or sales
information. Confidential business or sales information does not
include information which has been disclosed to the public by
either of them or which is subsequently disclosed to the public
by the party claiming confidentiality or otherwise is in or
becomes part of the public domain.
(b) Neither party nor their respective Affiliates
shall solicit nor offer employment to any person employed by the
other party.
7.2 No Pre-Closing Extraordinary Transactions. From
June 25, 1995 until the earlier of the termination of this
Agreement or the Closing, TRIPLE-I, the TRIPLE-I SUBSIDIARIES,
NEWCO, AUTOLOGIC, AIL and the VOLT SUBSIDIARIES shall be operated
in good faith in the ordinary course of business. Except as
-69-
permitted under Section 5.7, no dividends, issuance of stock
(except pursuant to outstanding options of TRIPLE-I), issuance of
stock options and no extraordinary transactions or payments not
in the ordinary course of business shall be made either by
TRIPLE-I, any TRIPLE-I SUBSIDIARY, NEWCO, or AUTOLOGIC, AIL or
any VOLT SUBSIDIARY without the written consent of the other
party. Anything in this Section 7.2 to the contrary
notwithstanding, the parties hereto agree to establish the joint
venture described in Section 7.21 hereto to operate during the
period between the date of this Agreement and the Closing Date.
7.3 Publicity. No announcement of this Agreement
shall be made except in a jointly agreed-upon announcement and
except as otherwise required by applicable law or government
regulation.
7.4 TRIPLE-I/NEWCO Merger. As soon as practicable
following the Closing of this Agreement, and subject to Section
7.13 hereof, the Boards of Directors of TRIPLE-I and NEWCO shall
approve and adopt the Agreement of Merger and shall execute and
file with the Secretary of the State of Delaware the Certificate
of Merger each in a form and upon such terms as shall be agreed
upon by the parties hereto.
7.5 Election of NEWCO Board of Directors. Immediately
prior to the TRIPLE-I/NEWCO MERGER, VOLT shall cause to be
elected to the Board of Directors of NEWCO the following seven
directors: Xxxxxxx Xxxx, Xxxxx X. Xxxxxxx, Xxxxxx Xxxxxxxxx,
Xxxx XxXxxxxxx, Xxxxxxx Xxxx, Xxxxx Xxxx and Xxxxx Xxxxxxx (the
-70-
"New Board", of which Xxxxxxx Xxxx, Xxxxx Xxxx and Xxxxx Xxxxxxx,
and their successors during the two-year period following the
Effective Time, shall hereinafter be referred to as the "Minority
Directors").
7.6 Election of Officers. It is intended and agreed
that upon election of the New Board, such New Board shall vote to
elect the following persons as officers:
Xxxxxxx Xxxx Chairman of the Board
Xxxxxx Xxxxxxxxx Vice Chairman and Chief
Operating Officer
Xxxxx Xxxxxxx President
Xxxxxx Xxxxxxx Senior Vice President of
Administration, Treasurer,
Chief Financial Officer and
Secretary
7.7 Directors' Meetings, VOLT SUBSIDIARIES. Upon
completion of the Closing, VOLT will direct and ensure that each
of the VOLT SUBSIDIARIES hold all meetings necessary for the
approval of stock transfers and registrations arising under this
Agreement.
7.8 Directors and Officers of NEWCO Subsidiaries.
Promptly following the Closing, the NEWCO Board of Directors
shall determine and cause to be appointed the directors and
officers of the NEWCO Subsidiaries.
7.9 Transaction Costs. VOLT , TRIPLE-I and NEWCO and
after the Closing, VOLT and NEWCO, shall bear their own separate
costs in connection with this transaction whether or not the
-71-
transaction is consummated and whether or not such costs are
incurred prior or subsequent to the Closing, provided, however,
(a) if the transaction is consummated, NEWCO will
bear all costs associated with the preparation of the S-4 as
defined herein and all other Federal and State Securities Laws
filings (collectively "Securities Work"), it being understood
that (i) to the extent that VOLT's and TRIPLE-I's attorneys and
accountants do Securities Work in addition to their
representation of VOLT or TRIPLE-I, as the case may be, NEWCO
shall bear the costs of such Securities Work; and (ii) the
charges of TRIPLE-I's attorneys and accountants for work in
connection with this transaction other than Securities Work, if
due and payable after the Closing, shall be accrued on TRIPLE-I's
financial statements dated as of the Closing to the extent not
paid prior thereto.
(b) in the event that the transaction is not
consummated, then (i) VOLT and TRIPLE-I shall each bear the costs
of its respective attorneys and accountants for their Securities
Work on behalf of NEWCO; (ii) all other costs of NEWCO in
connection with Securities Work shall be apportioned equally
between VOLT and TRIPLE-I; and
(c) in all events, the fees and other charges of
VOLT's and TRIPLE-I's investment bankers, whether or not such
fees would otherwise be considered costs of Securities Work, will
be borne by VOLT and TRIPLE-I, respectively, it being further
understood that any such fees and charges of TRIPLE-I's
-72-
investment bankers, if due and payable after the Closing, shall
be accrued on TRIPLE-I's financial statements dated as of the
Closing to the extent paid prior thereto.
7.10 Employee Benefit Matters.
(a) VOLT and NEWCO agree that, effective upon the
merger of AUTOLOGIC into NEWCO, VOLT shall cause NEWCO to adopt
and assume the Benefit Plans which are currently in force on
behalf of the employees of AUTOLOGIC with substantially the same
terms and conditions as in effect immediately prior to the merger
of AUTOLOGIC into NEWCO. To the extent necessary or desirable,
VOLT shall cause the Benefit Plans to be amended to include NEWCO
as a sponsoring employer of such plans. The parties agree that
at the Effective Time, all continuing pre-merger employees of
NEWCO shall become eligible to participate (and all continuing
premerger employees of TRIPLE-I shall continue to participate) in
all of the retirement programs, and subject to this Section 7.10,
all other employee benefit programs generally available to
TRIPLE-I employees, except for the Information International,
Inc. 1976 Employee Stock Ownership Plan (the "TRIPLE-I ESOP"),
(which plan shall be terminated), but including, without
limitation, the Information International, Inc. Profit-Sharing
and 401(k) Plan and Trust (the "TRIPLE-I 401(k) Plan"), based on
their respective dates of employment with NEWCO, AUTOLOGIC or any
other VOLT affiliate.
(b) At the Effective Time NEWCO shall adopt and
assume the TRIPLE-I 401(k) Plan as the Plan sponsor.
-73-
(c) On or before the Effective Time
(i) TRIPLE-I agrees to amend the TRIPLE-I
401(k) Plan, effective January 1, 1995, to provide that
continuing pre-merger NEWCO employees shall be granted service
for eligibility and vesting purposes under the TRIPLE-I 401(k)
Plan based on employment with NEWCO and any other VOLT Affiliate,
to the extent such service was granted under the VOLT Employee
Stock Ownership Plan (the "VOLT ESOP") and the VOLT 401(k)
Savings Plan (the "VOLT Savings Plan", and collectively with the
VOLT ESOP, the "VOLT Plans").
(ii) TRIPLE-I agrees to amend the TRIPLE-I
401(k) Plan, effective January 1, 1995, to provide that each
former NEWCO employee shall be eligible to receive an allocation
of any "profit sharing contribution" under such plan for the plan
year ending December 31, 1995 if such employee accrued 1,000
hours of total service with NEWCO AUTOLOGIC (or any other VOLT
Affiliate) and TRIPLE-I.
(d) VOLT agrees to amend the VOLT ESOP, effective
November 1, 1994, to provide that service with NEWCO or AUTOLOGIC
shall be counted in determining such employee's vested percentage
for the plan year ending October 31, 1995, and to provide that
any continuing pre-merger NEWCO employee shall be entitled to
receive an allocation of his or her contribution to the VOLT ESOP
for the plan year ending October 31, 1995 (based on his or her
compensation with AUTOLOGIC) if such employee accrued 1,000 hours
of service with either AUTOLOGIC, NEWCO or TRIPLE-I and shall be
-74-
considered "employed" on the last day of such plan year for
purposes of the VOLT ESOP if such employee is employed by TRIPLE-
I on October 31, 1995. VOLT shall amend the VOLT ESOP,
effective, November 1, 1994, and the VOLT Savings Plan, effective
January 1, 1995, to provide that, as of the date of the merger
between NEWCO and TRIPLE-I, NEWCO employees shall cease active
participation in the Plan and, except for contributions to the
VOLT ESOP on account of the plan year ending October 31, 1995, if
any, no further employer or employee contributions shall be made
to the VOLT ESOP or the VOLT Savings Plan on behalf of any former
NEWCO employee.
(e) The parties to this Agreement agree to
cooperate to effectuate a transfer of participants from the VOLT
Plans to the TRIPLE-I 401(k) Plan (as adopted by NEWCO) and each
of them shall do whatever is necessary, including without
limitation, execution of any amendments and securing any
necessary approvals from the Internal Revenue Service to
implement the provisions of this Agreement.
(f) NEWCO agrees to use reasonable efforts to
obtain approval of NEWCO'S stock option plans by NEWCO's security
holders under Rule 16b-3(a) as promulgated under the Exchange
Act, and to otherwise comply with the requirements of such Rule
16b-3(a).
(g) The parties agree to cooperate to provide a
program of welfare benefits, (including without limitation,
medical, health, life insurance, severance pay and vacation pay)
-75-
on behalf of the all continuing post-merger employees of TRIPLE-
I, utilizing either of the individual benefit programs currently
available to the pre-merger employees of TRIPLE-I or NEWCO. In
determining the programs to be made available to the post-merger
employees, the parties shall consider the cost of the programs,
the availability of an expanded group of employees and the
relative value of the benefits. To the extent possible, prior to
the Effective Time, the parties shall make a final determination
with respect to the terms and conditions of each such welfare
benefit program and shall cause TRIPLE-I or NEWCO, as the case
may be, to take appropriate action to adopt the particular
welfare plan and to make such plan available to the post-merger
employees of TRIPLE-I. In the event that the parties are unable
to reach a decision regarding a particular benefit plan prior to
the Effective Time, the pre-merger plan of TRIPLE-I shall be
continued and all continuing post-merger employees of NEWCO shall
become eligible to participate in such welfare plan, to the
extent provided under the terms and conditions of such welfare
plan, provided, however, that all continuing pre-merger employees
of TRIPLE-I shall become eligible to participate in such programs
based on their original dates of employment with NEWCO or
AUTOLOGIC. With respect to the Medical Plan on account 1995,
deductibles, co-payments and other participant charges, which are
calculated on the basis of a calendar year, shall be adjusted so
that each participant (or family group) is not required to expend
more, in total, than would have been required, if had such
-76-
participant (or family group) had participated in the surviving
medical or health plan from January 1, 1995.
7.11 Preparation of Proxy Statement/ Prospectus or
Information Statement/Prospectus. As promptly as practicable
after the execution of this Agreement, NEWCO shall prepare and
file with the SEC a Proxy Statement/Prospectus or an Information
Statement/Prospectus included in a Registration Statement on Form
S-4 (the "S-4") with respect to the taking of corporate action
for the purpose of authorizing the consummation of the
transactions and other actions contemplated by Section 7.13 of
this Agreement. NEWCO shall use its best efforts to cause the S-
4 to be declared effective under the Securities Act as promptly
as practicable after such filing. NEWCO shall take any action
(other than qualifying to do business in any state in which it is
not now so qualified) required to be taken under any applicable
Federal Securities Law (including any filings required to be made
under the Exchange Act) or Blue Sky Law with respect to the
issuance of NEWCO Common Stock to the shareholders of TRIPLE-I
pursuant to the terms of this Agreement. TRIPLE-I shall furnish
in writing all information concerning TRIPLE-I and shall
cooperate with VOLT and NEWCO as may be requested by VOLT and
NEWCO in connection with the preparation of the S-4 and any
applicable Blue Sky Law. Subject to the terms of Section 8.11 of
this Agreement, TRIPLE-I shall have the opportunity to review
drafts of the S-4 prior to the filing of the S-4 and shall advise
VOLT in writing of any changes it believes are appropriate with
-77-
respect to information supplied concerning TRIPLE-I or the
characterization or description of the transactions contemplated
hereby.
7.12 Access to Information. Upon reasonable notice,
VOLT and TRIPLE-I shall each afford to the officers, employees,
accountants, counsel and other representatives of the other,
reasonable access, during normal business hours during the period
prior to the Effective Time, to all its properties, books,
contracts, commitments and records and, during such period, each
of VOLT and TRIPLE-I shall furnish promptly to the other all
other information concerning its business, properties and
personnel as such other party may reasonably request. The
investigation by and knowledge of VOLT and TRIPLE-I, and
furnishing of information to each such party, shall not affect
the right of such party to rely on the representations,
warranties, covenants and agreements of the other parties hereto.
7.13 Shareholders' Approvals. VOLT, as the sole
shareholder of NEWCO, shall approve the transactions contemplated
by this Agreement and shall cause the approval of such
transactions by the Board of Directors of NEWCO. TRIPLE-I will,
through its Board of Directors, recommend to TRIPLE-I's
Shareholders the approval of this Agreement and the TRIPLE-
I/NEWCO Merger and the other transactions contemplated hereby and
the Board of Directors of TRIPLE-I shall approve this Agreement,
the TRIPLE I/NEWCO Merger and the other transactions contemplated
hereby as soon as practicable after the date on which the S-4
-78-
becomes effective. Unless the Board of Directors in good faith
believes its fiduciary duties otherwise require, TRIPLE I shall,
through its Board of Directors, recommend to its shareholders
approval of this Agreement and the transactions contemplated
hereby as soon as practicable after the date on which the S-4
becomes effective.
7.14 Legal Conditions to TRIPLE I/NEWCO Merger. VOLT
and TRIPLE-I will each take all reasonable actions necessary to
comply promptly with all legal requirements which may be imposed
on itself with respect to this Agreement (including furnishing
all information (i) required under the Xxxx Xxxxx Xxxxxx
Antitrust Improvement Act, the Securities Act and the Exchange
Act and (ii) in connection with the Blue Sky Filings, the
Certificates of TRIPLE I/NEWCO Merger and approvals of or filings
with any other governmental entity and will promptly cooperate
with and furnish information to each other in connection with any
such requirements imposed upon any of them in connection with the
TRIPLE I/NEWCO Merger. VOLT and TRIPLE-I will each take all
reasonable actions necessary to obtain (and will cooperate with
each other in obtaining) any consent, authorization, order or
approval of, or any exemption by, any governmental entity or
other public or private third party, required to be obtained or
made by VOLT and TRIPLE-I in connection with the TRIPLE I/NEWCO
Merger or the taking of any action contemplated thereby or by
this Agreement.
-79-
7.15 Rule 145 Affiliates. Prior to the Closing Date,
TRIPLE-I shall deliver to VOLT a letter substantially in the form
attached hereto as Exhibit D, identifying all persons who may be,
at the time this Agreement is submitted for approval to the
shareholders of TRIPLE-I, "affiliates" of TRIPLE-I for purposes
of Rule 145 under the Securities Act. TRIPLE-I shall use
reasonable efforts to cause each such person to deliver to VOLT
and NEWCO on or prior to the Closing Date written agreements,
substantially in the form attached as Exhibit E hereto.
7.16 Stock Exchange Listing. VOLT shall use reasonable
efforts to cause the shares of NEWCO Common Stock to be issued in
the TRIPLE I/NEWCO Merger to be approved for listing on the
NASDAQ National Market, subject to official notice of issuance,
prior to the Effective Time or such other NASDAQ market for
which NEWCO shall be eligible.
7.17 Additional Agreements; Best Efforts. Subject to
the terms and conditions of this Agreement, and unless otherwise
provided herein, each of the parties hereto agrees to use best
efforts to cause the conditions to effect the TRIPLE I/NEWCO
Merger to be met, including taking, or causing to be taken, all
actions and to do, or cause to be done, all things necessary,
proper or advisable under applicable laws and regulations to
consummate and make effective the transactions contemplated by
this Agreement, including full cooperation with the other parties
and the provision of information and making all necessary filings
in connection with, among other things, the approvals under the
-80-
Xxxx Xxxxx Xxxxxx Antitrust Improvement Act, the S-4 and the Blue
Sky Filings.
7.18 Tax Treatment. VOLT, NEWCO and TRIPLE-I each
agree to treat the TRIPLE-I/NEWCO Merger as a reorganization
within Section 368(a)(1)(A) of the Code.
7.19 Letter of TRIPLE-I's Accountants. TRIPLE-I shall
use its best efforts to cause to be delivered to VOLT a letter of
Xxxxxx Xxxxxxxx, TRIPLE-I's independent auditors, and addressed
to VOLT, dated a date within two business days before the date on
which the S-4 shall become effective, and confirmed in writing as
of the Effective Time, in substantially the same form and
substance as is contained in Exhibit F hereto which letters shall
provide for the required accounting procedures to be performed up
to the date which is 5 days prior to the date of each respective
letter.
7.20 Letter of NEWCO'S Accountants. VOLT shall use its
best efforts to cause to be delivered to TRIPLE-I a letter of
Ernst & Young, LLP, NEWCO'S independent auditors, addressed to
TRIPLE I, dated a date within two business days before the date
on which the S-4 shall become effective, and confirmed in writing
as of the Effective Time, in substantially the same form and
substance as is contained in Exhibit G hereto which letters shall
provide for the required accounting procedures to be performed up
to the date which is 5 days prior to the date of each respective
letter.
-81-
7.21 Change of Corporate Name. Upon or prior to the
Closing, Volt and NEWCO agree to cause NEWCO's Certificate of
Incorporation to be amended to provide that NEWCO's name shall be
AUTOLOGIC INFORMATION INTERNATIONAL, INC.
7.22 VOLT/NEWCO Intercompany Transactions. VOLT, NEWCO
and TRIPLE-I agree that, for the first two years following the
Closing Date, all proposed transactions between VOLT or any VOLT
Affiliate and NEWCO shall be brought to and approved by a
majority of the Board of Directors of NEWCO; provided that NEWCO
directors who are also VOLT directors may vote on such proposals;
and provided, further, that this Section 7.22 shall not apply to
situations in which VOLT or a VOLT Affiliate purchases goods or
services from NEWCO at NEWCO's then current market price.
7.23 VOLT Name. After the Closing, none of TRIPLE-I,
NEWCO, the VOLT SUBSIDIARIES or the TRIPLE-I SUBSIDIARIES will
use the name "VOLT", or any variation thereof, without the
written permission of VOLT, and each of the VOLT SUBSIDIARIES
shall change its name as soon as practicable to eliminate "VOLT".
7.24 Accounts Receivable and Inventory. With respect
to reserves for accounts receivable and inventory, the Audit
Committee of the NEWCO Board of Directors shall, at the end of
NEWCO's first and second fiscal years following the Closing Date,
report to the NEWCO Board of Directors on the adequacy of such
reserves on the books of TRIPLE-I, the TRIPLE-I SUBSIDIARIES,
AUTOLOGIC, AIL, the VOLT SUBSIDIARIES and/or NEWCO as of the
Closing Date. Should the NEWCO Board of Directors determine that
-82-
the said reserves, as of the Closing Date were inadequate, NEWCO
(or VOLT in the case of inadequate TRIPLE-I reserves) shall be
reimbursed to the extent of the inadequacy as either TRIPLE-I
Losses or VOLT Losses, as defined herein, as the case may be.
Any amounts payable under this Section 7.24 will be first set off
as provided by Section 10.5 hereof and any remainder will then be
paid as provided by Section 10.6 hereof.
7.25 Transfer of Certain Shares. In connection with
the transfer of the shares of Volt Autologic Ltd., an Israeli
corporation (hereinafter "VAL"), the parties shall cooperate and
cause their respective subsidiaries, including without limitation
VOLT Technical Corporation, to cooperate to the extent necessary
to enable NEWCO and any holder of VAL shares affiliated with
NEWCO to open such bank account(s) in Israel through which
payments of whatever nature attributable to the ownership, sale
or other transfer or disposition of VAL shares may be repatriated
from Israel in non-Israeli currency. Without limitation, such
cooperation shall include the provision of any and all
documentation and the execution of any and all statements and
affidavits as may be required by the bank in which such
account(s) is (are) to be opened or by any Israeli government
authority, evidencing, inter alia,
(i) that each of VOLT and VOLT Technical
Corporation are foreign, non-Israeli entities and qualified
as "Foreign Residents" under Israeli currency control
regulations (hereinafter "Foreign Residents") at the time of
-83-
their purchase of VAL shares and at all times thereafter
through the time of sale thereof,
(ii) that each of VOLT and VOLT Technical
Corporation held the VAL shares for more than seven (7)
years,
(iii) the stock powers transferring the VAL
shares from VOLT and VOLT Technical Corporation to NEWCO and
AIL, and
(iv) the value of the transaction transferring the
VAL shares pursuant hereto.
ARTICLE VIII
CONDITIONS TO OBLIGATIONS OF PARTIES TO CLOSE
The obligations of the Parties hereto to consummate the
transactions as provided herein are subject to the fulfillment,
at or before the Closing, of each of the following conditions
(all or any of which may be waived in whole or in part in the
sole discretion of the party and only by such party for whose
benefit or protection the condition exists):
8.1 Representations and Warranties. The
representations and warranties made by the Parties in this
Agreement, taken as a whole, shall be true and correct, in all
respects material to the validity and enforceability of this
Agreement and to the Condition of the respective Businesses of
TRIPLE-I, the TRIPLE-I SUBSIDIARIES, the VOLT SUBSIDIARIES,
AUTOLOGIC, AIL and NEWCO, on and as of the Closing Date as though
-84-
made on and as of the Closing Date or, in the case of
representations and warranties made as of a specified date
earlier than the Closing Date, on and as of such earlier date.
8.2 Orders and Laws. There shall not be in effect on
the Closing Date any Order or Law restraining, enjoining or
otherwise prohibiting or making illegal the consummation of any
of the transactions contemplated by this Agreement or any of the
Operative Agreements.
8.3 Regulatory Consents and Approvals. All consents,
approvals and actions of, filings with and notices to any
Governmental or Regulatory Authority necessary to permit TRIPLE-I
and VOLT to perform their obligations under this Agreement and
the Exhibits hereto and to consummate the transactions
contemplated hereby and thereby shall have been duly obtained,
made or given and shall be in full force and effect, and all
terminations or expirations of waiting periods imposed by any
Governmental or Regulatory Authority necessary for the
consummation of the transactions contemplated by this Agreement
and the Operative Agreements, shall have occurred, including but
not limited to, the following:
(a) The expiration of the Xxxx Xxxxx Xxxxxx
Antitrust Improvement Act, 15 U.S.C. Section 18a, waiting period
(whether or not extended), without receipt by either party of an
objection from the United States Justice Department or the
Federal Trade Commission, after the filing by both parties of a
-85-
completed Xxxx Xxxxx Xxxxxx pre-merger notification form and
payment by VOLT of the required fee.
(b) The obtaining of a tax clearance from the
State of California for the merger provided in Article 5.1(d)
and, if required, for the merger provided in Article 7, and the
obtaining of a tax clearance from any other state from which such
a tax clearance must be obtained with respect to such mergers.
(c) The notification, not less than twenty days
before the Closing, of the French Treasury, of the transaction,
and specifically that as a result of the planned merger of
TRIPLE-I and NEWCO, NEWCO would become the sole shareholder of
AIL.
(d) The filing promptly after the execution of
this Agreement of a notification with the German Federal Cartel
Office pursuant to Section 23,24 of the German Act Against
Restraints of Competition.
8.4 Landlord's Consents. Where required by the terms
thereof, TRIPLE-I shall obtain from each Landlord or Lessor, with
respect to the Real Property Leases described in Schedule 4.15
hereto, a certificate or consent reasonably satisfactory in form
and substance to VOLT confirming the continuing validity of each
such Real Property Lease, subsequent to the Effective Time, and
the absence of any breach and basis for termination thereof.
8.5 Third Party Consents. The consents (or in lieu
thereof waivers) listed in Schedule 8.5 shall have been obtained
and shall be in full force and effect.
-86-
8.6 Fairness Opinion. The receipt of a satisfactory
and reasonable fairness opinion by TRIPLE-I from an independent
investment banker and by VOLT from an independent investment
banker supporting the fairness of the proposed transaction.
8.7 Shareholder Approval. The approval by a majority
of the Shareholders of each of TRIPLE-I and NEWCO of the
transactions contemplated by this Agreement.
8.8 Debt-Free Merged Company. TRIPLE-I, the TRIPLE-I
SUBSIDIARIES, AUTOLOGIC, AIL and the VOLT SUBSIDIARIES shall not
owe any money (1) to VOLT, (2) to associates or affiliates of
VOLT or AUTOLOGIC, or (3) to banks or others for moneys borrowed.
8.9 Compliance With Agreements. TRIPLE-I, NEWCO and
VOLT shall have complied with their respective agreements in
Articles V, VI and VII (except for the agreement set forth in
Section 7.25 of this Agreement).
8.10 Documents and Filing. The following filings and
deliveries of documents shall be made:
(a) Filing by VOLT-Autologic AB of Sweden, of its
annual report for the year ending October 31, 1994 with the
applicable local Patent and Registration Office.
(b) Full completion and updating of the minute
books of VOLT-Autologic, Ltd. of England and presentation of
copies thereof to TRIPLE-I.
(c) In Spain, the filing by the Spanish branch of
AIL of all financial reports for all periods prior to the
Closing, with the Commercial Registry.
-87-
(d) VOLT Autologic AB shall make a notation on
the share certificate that VOLT Information Sciences, Inc. is
entered in the share register as owner of the shares of VOLT
Autologic AB.
(e) All filings and deliveries required pursuant
to Section 6.3 of this Agreement.
8.11 Certain SEC Filings. VOLT and TRIPLE-I shall have
reached agreement on the contents before filing or becoming final
and or effective of all preliminary and definitive proxy or
information statements, registration statements and prospectuses
to be used in connection with the transactions contemplated by
this Agreement and the Exhibits hereto.
8.12 Exchange Listing. The shares of NEWCO Common
Stock issuable pursuant to this Agreement shall have been
authorized for listing on the NASDAQ National Market or such
other NASDAQ market for which NEWCO shall be eligible.
8.13 Effectiveness of S-4. The S-4 shall have become
effective under the Securities Act and shall not be the subject
of any stop order or proceedings seeking a stop order, under
Section 8 of the Securities Act.
8.14 Absence of Certain Injunctions and Government
Actions. The waiting period, and any extension thereof, under
the Xxxx Xxxxx Xxxxxx Antitrust Improvement Act and any other
applicable federal or state antitrust or fair trade law shall
have terminated or expired. There (i) shall not be in effect a
temporary restraining order or a preliminary or permanent
-88-
injunction or other order, decree or ruling by a governmental
entity which (A) restrains or prohibits the TRIPLE I/NEWCO Merger
or the consummation of all or any of the other transactions
contemplated hereby, or (B) prohibits or restricts the ownership
or operation by NEWCO (or any of its subsidiaries) of any portion
of its (or their) or TRIPLE-I's business or assets which is
material to the business of such entities, or compels NEWCO (or
any of its subsidiaries) to dispose of or hold separate any
portion of its (or their) or TRIPLE-I's business or assets which,
if required to be disposed of, would be likely to materially
diminish the value of TRIPLE-I to a reasonable purchaser, or
would be likely to have a material adverse effect on NEWCO
following the Closing, or (C) imposes any limitations on the
ability of NEWCO or any of its subsidiaries effectively to
control in any material respect the business and operation of
TRIPLE-I, or (D) is otherwise reasonably likely to have a
material adverse effect on NEWCO; or (ii) shall not be pending
before any governmental entity, any action or proceeding, whether
in law or in equity or otherwise, brought by any governmental
entity which seeks as relief a result described in clause (i)
above; or (iii) shall not have been promulgated or enacted by a
governmental entity a statute, rule, regulation or executive
order which has an effect described in clauses (i) (A), (B) or
(C) above; provided, however, that (x) subject to the right of
each party, in its sole discretion, to make the determination in
subsection (y), the parties shall use their best efforts to
-89-
litigate against the entry of, or to obtain the lifting of, such
temporary restraining order or preliminary or permanent
injunction or other governmental action; (y) in no event shall a
party be obligated to take or accept or refrain from taking any
action if the taking, acceptance or refraining from taking such
action is reasonably likely to materially diminish the value, as
such party may determine in its sole discretion, of TRIPLE-I to
NEWCO or of the TRIPLE-I/NEWCO merger to TRIPLE-I; and (z) the
existence of a temporary restraining order as described in clause
(i) or the pendency of an action or proceeding as described in
clause (ii) shall operate only to delay the Closing until the
30th day following the lifting of such temporary restraining
order or the conclusion of such action or proceeding, except that
there shall be deemed to be a failure of this condition if such
action or proceeding shall not have concluded, the parties
agreeing, subject to the other provisions of this Agreement, by
March 31, 1996, to exercise their best efforts to close as soon
as reasonably practicable following the lifting of any such
temporary restraining order or the conclusion of any such action
or proceeding.
8.15 Thousand Oaks Lease. A Lease, substantially in
the form attached hereto as Exhibit H, with respect to certain
premises located in Thousand Oaks, California, as described in
such Lease, shall have been executed by the parties identified in
such Lease as the Lessee and the Lessor.
-90-
8.16 Board of Directors Approval. The Board of
Directors of each of NEWCO, VOLT and TRIPLE-I shall have approved
and authorized the transactions to be consummated pursuant to
this Agreement, and the actions to be taken with respect thereto,
and certified resolutions evidencing such authorization and
approval shall be provided to the other parties hereto on or
prior to the Closing Date.
8.17 Registration Rights Agreement. The parties hereto
agree that on or prior to the Closing Date VOLT and NEWCO shall
execute a Registration Rights Agreement in a form and upon terms
which shall be agreed to by the parties hereto which agreement
shall provide, inter alia, for two separate demand registration
rights and for piggy-back registration rights upon customary
terms and subject to customary limitations.
8.18 Accounts Payable and Payroll. NEWCO and AUTOLOGIC
agree that on or prior to the Closing Date each of them shall pay
all of its accounts payable and trade liabilities (and cause the
payment of the accounts payable and trade liabilities of AIL and
the VOLT SUBSIDIARIES) as such accounts shall become due in the
ordinary course of business. VOLT agrees that it shall fund or
cause the funding of all uncashed NEWCO, AIL and VOLT
SUBSIDIARIES' payroll checks for payroll and payroll taxes
related thereto up to and including the Closing Date.
-91-
ARTICLE IX
9.1 Indemnification by VOLT. VOLT will indemnify and
hold TRIPLE-I (or NEWCO as the case may be) harmless with respect
to any cost or loss, including reasonable attorneys fees,
regardless of whether the circumstances giving rise to such
losses were disclosed in a Schedule to this Agreement or were
otherwise known to TRIPLE-I ("TRIPLE-I Losses"):
(a) incurred by TRIPLE-I (or NEWCO) as a result
of the breach by VOLT of any representation, warranty or
agreement contained in this Agreement or in the Share Purchase
Agreement concerning the purchase of the stock of VAPL,
(b) arising from any Liability of NEWCO,
AUTOLOGIC, AIL or the VOLT SUBSIDIARIES which arose on or before
July 28, 1995 and which is not accrued on the VOLT Financial
Statements which are known or should have been known by VOLT,
NEWCO, AUTOLOGIC, AIL or the VOLT SUBSIDIARIES as of July 28,
1995;
(c) (1) arising from the liability of NEWCO,
AUTOLOGIC or AIL for federal income taxes which were incurred
prior to the Closing.
(2) arising from the liability of NEWCO,
AUTOLOGIC, AIL or the VOLT SUBSIDIARIES for foreign, state, or
local income taxes and sales and use, transfer, value added,
excise or other taxes which were incurred and due prior to the
Closing Date, or if incurred prior to July 28, 1995, were not
accrued on the VOLT Interim Financial Statements.
-92-
(d) arising from (i) any and all current or
future liabilities or obligations under any foreign countries or
United States federal, state or local law, regulations, order or
decree relating to pollution control, environmental protection,
health, welfare, or public safety, and (ii) any and all personal
injury, death, disease, illness, sickness, economic loss, loss of
use, property damage or other type of claim arising from:
(i) the handling, storage, use, delivery,
transportation or disposal of any Hazardous Substances,
including chemicals utilized in the manufacture of circuit
boards, at, on, under, in or from any property or facility
owned or operated by NEWCO, AUTOLOGIC, AIL or any of the
VOLT SUBSIDIARIES prior to the effective date of this
Agreement.
(ii) any escape, emission, discharge, release
or threat of release of any Hazardous Substances into or
upon the soil, air, surface water, ground water or land at
any property or facility owned or operated by NEWCO,
AUTOLOGIC, AIL or any of the VOLT SUBSIDIARIES prior to the
effective date of this Agreement.
(e) arising from any current or future
liabilities or obligations under any foreign or United States
federal, state or local law, regulations, order or decree
relating to employment discrimination, wrongful termination,
worker's compensation or other type of claim arising from:
-93-
(i) the hiring, firing, training,
compensation, or other treatment of employees by NEWCO,
AUTOLOGIC, AIL, or any of the VOLT SUBSIDIARIES prior to the
Closing.
(ii) any failure to provide employee benefits
as mandated under federal or state law or to comply with
federal wage and hour regulations on behalf of NEWCO,
AUTOLOGIC, AIL, or any of the VOLT SUBSIDIARIES prior to the
Closing.
(f) arising from any and all liabilities arising
out of the conduct or operation of VOLT's business or the
business of any VOLT subsidiary (direct or indirect) or other
Affiliate or Associate of VOLT, excepting only therefrom, the
business of NEWCO, AUTOLOGIC, AIL and the VOLT SUBSIDIARIES.
(g) arising from any claim by Xxxxxxx XxXxxxxx
(or any assignee or representative of his) concerning his rights
as a shareholder of AUTOLOGIC or NEWCO during any time period
prior to the Closing.
9.2 Minimums. VOLT shall have no liability under
subsections (a), (b), (d), (e) or (g) of Section 9.1 unless and
to the extent that TRIPLE-I's (or NEWCO'S) Losses exceed $375,000
in the aggregate. All other indemnifications shall not be
subject to any minimum amount, individually, or in the aggregate.
9.3 Notice. VOLT shall not be required to indemnify
TRIPLE-I (or NEWCO) with respect to any claim of a TRIPLE-I Loss
made under subparagraphs (a) or (b) hereof unless TRIPLE-I (or
-94-
NEWCO) notifies VOLT of its claims, in writing, within two years
of the Closing. In the case of a claim of a TRIPLE-I Loss made
under Paragraph 9.1(c), (d), (e), (f) or (g), the right to assert
such claim of a TRIPLE-I Loss shall be the same as the applicable
statute of limitations governing the claim giving rise to such
claim of TRIPLE-I Loss, plus the applicable procedural deadline
for completing service of process plus ten days, but in no event
more than 130 days.
9.4 Exclusive Remedy. Except for fraud, the
indemnities provided herein shall constitute TRIPLE-I's sole and
exclusive remedy with respect to the subject matter thereof.
ARTICLE X
10.1 Indemnification by TRIPLE-I. TRIPLE-I will
indemnify and hold VOLT harmless with respect to any cost or
loss incurred by VOLT, NEWCO or by any NEWCO Subsidiary,
including reasonable attorneys fees ("VOLT Losses") and
regardless of whether the circumstances giving rise to such
losses were disclosed in a Schedule to this Agreement or were
otherwise known to VOLT:
(a) any Loss incurred by VOLT or NEWCO or any
NEWCO Subsidiary as a result of the breach by TRIPLE-I of any
representation, warranty or agreement contained in this
Agreement.
(b) arising from any Liability of TRIPLE-I or
the TRIPLE-I SUBSIDIARIES which arose on or before June 30, 1995,
-95-
and which is not accrued on the TRIPLE-I Financial Statements
which are known or should have been known by TRIPLE-I as of June
30, 1995;
(c) (1) arising from the liability of TRIPLE-I
or the TRIPLE-I SUBSIDIARIES for any due and unpaid federal
income taxes which were incurred prior to the Closing, but were
not paid prior to the Closing Date;
(2) arising from the liability of TRIPLE-I
or the TRIPLE-I SUBSIDIARIES for foreign, state, or local income
taxes and sales and use, transfer, value added, excise or other
taxes which were incurred and due prior to the Closing Date, or
if incurred prior to June 30, 1995, were not accrued on the
TRIPLE-I Interim Financial Statements;
(3) arising from any permanent reduction in
the net operating loss carryover of TRIPLE-I available to NEWCO
as a result of any incorrect entries in any income tax return of
TRIPLE-I filed with respect to any tax period ending prior to
June 30, 1995.
(d) arising from (i) any and all current or
future liabilities or obligations under any foreign countries or
United States federal, state or local law, regulations, order or
decree relating to pollution control, environmental protection,
health, welfare, or public safety, and (ii) any and all personal
injury, death, disease, illness, sickness, economic loss, loss of
use, property damage or other type of claim arising from:
-96-
(i) the handling, storage, use, delivery,
transportation or disposal of any Hazardous Substances,
including chemicals utilized in the manufacture of circuit
boards, at, on, under, in or from any property or facility
owned or operated by TRIPLE-I or the TRIPLE-I SUBSIDIARIES
prior to the effective date of this Agreement.
(ii) any escape, emission, discharge, release
or threat of release of any Hazardous Substances into or
upon the soil, air, surface water, ground water or land at
any property or facility owned or operated by TRIPLE-I or
the TRIPLE-I SUBSIDIARIES prior to the effective date of
this Agreement.
(e) arising from any current or future
liabilities or obligations under any foreign or United States
federal, state or local law, regulations, order or decree
relating to employment discrimination, wrongful termination,
worker's compensation or other type of claim arising from:
(i) the hiring, firing, training,
compensation, or other treatment of employees by TRIPLE-I or
the TRIPLE-I SUBSIDIARIES prior to the date the Closing.
(ii) any failure to provide employee benefits
as mandated under federal or state law or to comply with
federal wage and hour regulations on behalf of TRIPLE-I or
the TRIPLE-I SUBSIDIARIES prior to the effective date of
this Agreement.
-97-
10.2 Assumption of Liability. NEWCO shall assume any
and all liability of TRIPLE-I to make any payment to VOLT under
this Article X and TRIPLE-I shall, upon such assumption, be
relieved of such liability.
10.3 Minimums. TRIPLE-I (or NEWCO) shall have no
liability under subsections (a), (b), (d) or (e) of Section 10.1
except to the extent that VOLT Losses exceed $375,000 in the
aggregate. All other indemnifications shall not be subject to
any minimum amount, individually, or in the aggregate.
10.4 Notice. TRIPLE-I (or NEWCO) shall not be required
to indemnify VOLT with respect to any claim made under
subsections 10.1(a) or (b) hereof unless VOLT notifies TRIPLE-I
(or NEWCO) of its claims, in writing, within two years of the
Closing. In the case of a claim of a VOLT Loss made under
subsections 10.1(c), (d) or (e), the right to assert such claim
of a VOLT Loss shall be the same as the applicable statute of
limitations governing the claim giving rise to such claim of VOLT
Loss, plus the applicable procedural deadline for completing
service of process plus ten days but in no event more than 130
days.
10.5 Offset of Indemnification Claims. With respect to
all TRIPLE-I Losses and VOLT Losses, the undisputed TRIPLE-I
Losses and VOLT Losses shall be offset against each other 120
days after the close of each of the first two full fiscal years
of NEWCO following the Closing and any balance due thereafter
shall be paid immediately. Disputed Losses shall be determined
-98-
in accordance with paragraph 12.11. Losses arising after the
aforesaid fiscal years but within the period permitted by this
Article X may be presented for payment at any time.
10.6 Method of Payment. In accordance with paragraph
10.2, TRIPLE-I's indemnification of VOLT pursuant to this Article
shall be by the issuance to VOLT by NEWCO of additional NEWCO
Common Stock (the "Indemnification Shares") and not money. Such
Indemnification Shares shall be issued pursuant to the following
formula: the actual percentage of VOLT's ownership of NEWCO on
the payment date (not including stock owned by VOLT prior to the
Closing Date) times the aggregate amount of the VOLT Losses at
the time in question, divided by the average bid and ask price of
TRIPLE-I's stock on the NASDAQ National Market on the Closing
Date, or if there is no trade on such date, then on the last day
prior to the Closing Date on which there was a trade.
10.7 Exclusive Remedy. Except for fraud, the
indemnities provided herein shall constitute VOLT's sole and
exclusive remedy with respect to the subject matter thereof.
ARTICLE XI - REMEDIES
11.1 Waivers and Modifications. The failure of TRIPLE-
I (or NEWCO) or VOLT to insist, in any one or more instances,
upon the strict performance of any of the terms, conditions or
covenants of this Agreement shall not be construed as a waiver or
relinquishment for the future of such term, condition or
covenant. A receipt by TRIPLE-I, NEWCO, or VOLT of any money
-99-
with knowledge of the breach of any term, condition or covenant
of this Agreement, shall not be deemed a waiver of such breach,
and no waiver, change, modification or discharge by either party
hereto of any provision in this Agreement shall be deemed to have
been made or shall be effective unless expressed in writing and
signed by both TRIPLE-I (or NEWCO) and VOLT.
11.2 Claims by third parties. In the event any damages
or expenses are incurred by either party for which it claims
indemnification under this Agreement (the "Indemnitee"), the
Indemnitee shall promptly notify the other party (the
"Indemnitor") in writing of such damages and expenses and to the
extent possible, notify the other party prior to incurring
expenses. If any claim for indemnification hereunder is based
upon an action or claim filed or made against the Indemnitee by a
third party, then the Indemnitor shall have the right to
negotiate a settlement or compromise of any such action or claim
or to defend any such action or claim at its sole cost and
expense.
In the event of a claim or anticipated claim for
indemnification arising out of a claim by a customer of TRIPLE-I,
AUTOLOGIC or NEWCO for a refund of the price of a system, to
return a system, for damages in excess of those contemplated
under the relevant contract or otherwise for consequential
damages, NEWCO or any of its Affiliates shall also have the right
to attempt if requested, to fulfill performance or remedy claimed
non-performance on behalf of TRIPLE-I, AUTOLOGIC or VOLT.
-100-
ARTICLE XII - MISCELLANEOUS
12.1 Definitions. (a) Defined Terms. As used in this
Agreement, the following defined terms have the meanings
indicated below:
"Actions or Proceedings" means any action, suit,
proceeding, arbitration or Governmental or Regulatory Authority
investigation.
"Affiliate" means any Person that directly, or
indirectly through one or more intermediaries, controls or is
controlled by or is under common control with the Person
specified. For purposes of this definition, control of a Person
means the power, direct or indirect, to direct or cause the
direction of the management and policies of such Person whether
by Contract or otherwise and, in any event and without limitation
of the previous sentence, any Person owning ten percent (10%) or
more of the voting securities of another Person shall be deemed
to control that Person.
"Agreement" means this Agreement and the Exhibits, and
the Schedules hereto and the certificates delivered in accordance
herewith, as the same shall have been amended from time to time
"Annual Financial Statements" has the meaning ascribed
to it in Section 3.14 and 4.10.
"Assets" and "Properties" of any Person means all
assets and properties of every kind, nature, character and
description (whether real, personal or mixed, whether tangible or
-101-
intangible and wherever situated), including the goodwill related
thereto, operated, owned or leased by such Person.
"Associate" means, with respect to any Person, any
corporation or other business organization of which such Person
is an officer or partner or is the beneficial owner, directly or
indirectly, of ten percent (10%) or more of any class of equity
securities, any trust or estate in which such Person has a
substantial beneficial interest or as to which such person serves
as a trustee or in a similar capacity and any relative or spouse
of such Person, or any relative of such spouse, who has the same
home as such Person.
"Blue Sky Filings" means the filings of documents with,
and the qualification with, the various state securities
authorities under Blue Sky Laws that are required in connection
with the transactions contemplated by this agreement.
"Blue Sky Laws" means state securities or legal
investment laws.
"Books and Records" of any Person means all files,
documents, instruments, papers, books and records relating to the
business, operations, condition of (financial or other), results
of operations and Assets and Properties of such Person, including
without limitation financial statements, Tax Returns and related
work papers and letters from accountants, budgets, pricing
guidelines, ledgers, journals, deeds, title policies, minute
books, stock certificates and books, stock transfer ledgers,
Contracts, Licenses, mailing lists, customer lists, lists of
-102-
network affiliates, computer files and programs, retrieval
programs, operating data and plans and environmental studies and
plans.
"Business" with respect to the business of TRIPLE-I and
the TRIPLE-I SUBSIDIARIES on the one hand, or the business of
AUTOLOGIC, AIL and the VOLT SUBSIDIARIES on the other hand, as
applicable, means the business operations, products and
activities which the VOLT Interim Financial Statements or the
TRIPLE-I Interim Financial Statements, as the case may be, report
on, excepting therefrom only products and operations which have
been discontinued.
"Business Licenses" has the meaning ascribed to it in
Section 3.23 and 4.18.
"Closing" means the closing of the transactions
contemplated by Article I.
"Closing Date" means the date upon which the Closing
shall take place as contemplated by this Agreement.
"Code" means the Internal Revenue Code of 1986, as
amended, and the rules and regulations promulgated thereunder.
"Condition of the Business" means the business,
financial condition, results of operations and Assets and
Properties of the Business.
"Contract" means any agreement, lease, license,
evidence of Indebtedness, mortgage, indenture, security agreement
or other contract.
-103-
"Environmental Laws" shall mean any and all foreign,
federal, state and local environmental, health or safety
statutes, laws, regulations, rules, ordinances, policies or
common law (whether now existing or hereafter enacted or
promulgated), of all governmental agencies, bureaus or
departments which may now or hereafter have jurisdiction over the
Borrower and all judicial and administrative and regulatory
decrees, judgments and orders, including common law rulings and
determinations, relating to injury to, or the protection of, real
or personal property or human health or the environment,
including, without limitation, all requirements pertaining to
reporting, licensing, permitting, investigation, remediation and
removal of emissions, discharges, releases or threatened releases
of Hazardous Materials, chemical substances, pollutants or
contaminants whether solid, liquid or gaseous in nature, into
the environment or relating to the manufacture, processing,
distribution, use, treatment, storage, disposal, transport or
handling of such Hazardous Materials, chemical substances,
pollutants or contaminants, in each case which are applicable to
the Borrower or its properties.
"ERISA" means the Employee Retirement Income Security
Act of 1974, as amended, and the rules and regulations
promulgated thereunder with respect to the United States and any
comparable or similar laws in France, Germany, Great Britain and
the Netherlands.
-104-
"ERISA Affiliate" means any Person who is in the same
controlled group of corporations or who is under common control
with any Seller (within the meaning of Section 414 of the Code).
"Financial Statements" has the meaning ascribed to it
in Section 3.14 and 4.9.
"GAAP" means generally accepted accounting principles,
consistently applied throughout the specified period and in the
immediately prior comparable period.
"Governmental or Regulatory Authority" means any court,
tribunal, arbitrator, authority, agency, commission, official or
other instrumentality of and foreign government, the United
States or any state, county, city or other political subdivision.
"Hazardous Substance" shall mean any substance (a) the
presence of which requires or may hereafter require notification,
investigation or remediation under any Environmental Law; (b)
which is or becomes defined as a "hazardous waste", "hazardous
material" or "hazardous substance" or "controlled industrial
waste" or "pollutant" or "contaminant" under any present or
future Environmental Law or amendments thereto including, without
limitation, the Comprehensive Environmental Response,
Compensation and Liability Act (42 U.S.C. Section 9601 et seq.)
and any applicable local statutes and the regulations promulgated
thereunder; (c) which is toxic, explosive, corrosive, flammable,
infectious, radioactive, carcinogenic, mutagenic or otherwise
hazardous and is or becomes regulated by any governmental
authority, agency, department, commission, board, agency or
-105-
instrumentality of any foreign country, the United States, any
state of the United States, or any political subdivision thereof
to the extent any of the foregoing has or had jurisdiction over
the Borrower; or (d) without limitation, which contains gasoline,
diesel fuel or other petroleum products, asbestos or
polychlorinated biphenyls.
"Indebtedness" of any Person means all obligations of
such Person (i) for borrowed money, (ii) evidenced by notes,
bonds, debentures or similar instruments, (iii) for the deferred
purchase price of goods or services (other than trade payables or
accruals incurred in the ordinary course of business), (iv) under
capital leases and (v) in the nature of guarantees of the
obligations described in clauses (i) through (iv) above of any
other Person.
"Intellectual Property" means all patents and patent
rights, trademarks and trademark rights, trade names and trade
name rights, service marks and service xxxx rights, service names
and service name rights, brand names, inventions, copyrights and
copyright rights, processes, formulae, trade dress, business and
product names, logos, slogans, trade secrets, industrial models,
processes, designs, methodologies, computer programs (including
all source codes) and related documentation, technical
information, manufacturing, engineering and technical drawings,
know-how and all pending applications for and registrations of
patents, trademarks, service marks and copyrights.
-106-
"Inter-Company Payables" shall mean any debt owed by
one Person to another Person, to a parent, holding company or
owner of a Person, to an Affiliate of a Person, to an Associate
of a Person or to any person who owns, controls or is involved in
managing any Person, directly or indirectly through other
entities.
"Knowledge" means the actual knowledge of the relevant
party or information which should reasonably have been known to
the person based upon the information set forth in its books and
records as of the relevant date.
"Law" means all laws, statutes, rules, regulations,
ordinances and other pronouncements having the effect of law of
the United States or any state, county, city, province or other
political subdivision of any Governmental or Regulatory
Authority, or those applicable in any foreign jurisdiction where
any of the parties, directly or through subsidiaries are present
or engaged in business.
"Liabilities" means all Indebtedness, obligations and
other liabilities of a Person (whether absolute, accrued,
contingent, fixed or otherwise, or whether due or to become due).
"Licenses" means all licenses, permits, certificates of
authority, authorizations, approvals, registrations, franchises
and similar consents granted or issued by any Governmental or
Regulatory Authority.
"Liens" means any mortgage, pledge, assessment,
security interest, lease, lien, adverse claim, levy, charge or
-107-
other encumbrance of any kind, or any conditional sale Contract,
title retention Contract or other Contract to give any of the
foregoing.
"Order" means any writ, judgment, decree, injunction or
similar order of any Governmental or Regulatory Authority (in
each such case whether preliminary or final).
"Pending" means, as to any Person with respect to an
Action or Proceeding, that such Action or Proceeding has been
commenced against such Person and has not been terminated, and
that service of process has been duly made upon or written notice
has otherwise been given to such Person as to such Action or
Proceeding.
"Permitted Lien" means (i) any Lien for Taxes not yet
due or delinquent or being contested in good faith by appropriate
proceedings for which adequate reserves have been established in
accordance with GAAP, and, (ii) any statutory Lien arising in the
ordinary course of business by operation of Law with respect to a
Liability that is not yet due or delinquent.
"Person" means any natural person, corporation, general
partnership, limited partnership, proprietorship, other business
organization, trust, union, association or Governmental or
Regulatory Authority.
"Pre-Closing Tax Period" means any Tax period ending on
or before the close of business on the Closing Date and, with
respect to a Tax period that commences before but ends after the
-108-
Closing Date, the portion of such period up to the close of
business on the Closing Date.
"Security Agreements" means any security arrangements
and collateral securing the repayment or other satisfaction of
the Accounts Receivable.
"Taxes" means any federal, state, county, local or
foreign taxes, charges, fees, levies, other assessments, or
withholding taxes or charges imposed by any governmental entity,
and includes any interest and penalties (civil or criminal) on or
additions to any such taxes and any expenses incurred in
connection with the determination, settlement or litigation of
any Tax liability.
(b) Construction of Certain Terms and Phrases.
Unless the context of this Agreement otherwise requires, (i)
words of any gender include each other gender; (ii) words using
the singular or plural number also include the plural or singular
number, respectively; (iii) the terms "hereof," "herein,"
"hereby" and derivative or similar words refer to this entire
Agreement; (iv) the terms "Article", "Section" or "Paragraph"
refer to the specified Article, Section or Paragraph of this
Agreement; and (v) the phrase "ordinary course of business"
refers to the business of a Person in connection with such
Person's Business. Whenever this Agreement refers to a number of
days, such number shall refer to calendar days unless Business
Days are specified. All accounting terms used herein and not
expressly defined herein shall have the meanings given to them
-109-
under GAAP. Any representation or warranty contained herein as
to the enforceability of a Contract shall be subject to the
effect of any bankruptcy, insolvency, reorganization, moratorium
or other similar law affecting the enforcement of creditors'
rights generally and to general equitable principles (regardless
of whether such enforceability is considered in a proceeding in
equity or at Law).
12.2 Amendments. This Agreement shall not be amended
or modified except in writing, signed by both parties.
12.3 Successors. This Agreement shall be binding upon
and inure to the benefit of the parties hereto and their
respective successors and assigns, provided neither party shall
assign this Agreement or any rights herein without the other
party's prior written consent.
12.4 License. Transfer by VOLT to TRIPLE-I of the
Shares does not include any right or license for TRIPLE-I or
AUTOLOGIC to operate under any of the patents or technical
information of VOLT or its Affiliates other than AUTOLOGIC, AIL
or the VOLT SUBSIDIARIES. None of TRIPLE-I, NEWCO or any NEWCO
Subsidiary shall have any right to use in any way the names
"VOLT" (alone or in combination with other words) or the logo of
VOLT.
12.5 Merger. All understandings and agreements
heretofore existing between the parties regarding the purchase
and sale of the Shares, including the letter of intent between
the parties dated June 25, 1995, are merged into this Agreement
-110-
and the schedules hereto, which fully and completely express the
agreement of the parties and was entered into after adequate
investigation, neither party relying upon any oral statement or
representation not embodied in this Agreement, or the schedules
hereto, made by the other; provided however, that VOLT
acknowledges that TRIPLE-I has relied upon the fact that there
are no false entries in the Books and Records of AUTOLOGIC, AIL
and the VOLT SUBSIDIARIES and TRIPLE-I acknowledges that VOLT has
relied upon the fact that there are no false entries in the Books
and Records of TRIPLE-I and the TRIPLE-I SUBSIDIARIES.
12.6 Notices. All notices, demands and requests
required or permitted to be given under the provisions of this
Agreement shall be in writing and shall be deemed given (a) when
personally delivered to the party to be given such notice or
other communication, (b) on the business day that such notice or
other communication is sent by facsimile or similar electronic
device, fully prepaid, which facsimile or similar electronic
communication shall promptly be confirmed by written notice, (c)
on the third business day following the date of deposit in the
United States mail if such notice or other communication is sent
by certified or registered air mail with return receipt requested
and postage thereon fully prepaid, or (d) on the business day
following the day such notice or other communication is sent by
reputable overnight courier, to the following:
If to VOLT VOLT INFORMATION SCIENCES, INC.
addressed to: 0000 Xxxxxx xx xxx
Xxxxxxxx
Xxx Xxxx, XX 00000
-111-
Attention: Xx. Xxxxx X. Xxxxxx
If to TRIPLE-I If before Closing:
INFORMATION INTERNATIONAL, INC.
addressed to: 0000 X. Xxxxxxx Xxxx.,
Xxxxx 0000
Xxx Xxxxxxx, XX 00000-0000
Attention: Treasurer
If after Closing:
AUTOLOGIC INFORMATION INTERNATIONAL, INC.
addressed to: 0000 Xxxxxx Xxxxxx Xxxxxxxxx
Xxxxxxx Xxxx, XX 00000-0000
Attention: Minority Directors
And if to NEWCO If before Closing:
AUTOLOGIC, INC.
addressed to: 0000 Xxxxxx Xxxxxx Xxxxxxxxx
Xxxxxxx Xxxx, XX 00000-0000
Attention: President (with a copy to
Xxxxx Xxxxxx)
If after Closing:
AUTOLOGIC INFORMATION INTERNATIONAL, INC.
addressed to: 0000 Xxxxxx Xxxxxx Xxxxxxxxx
Xxxxxxx Xxxx, XX 00000-0000
Attention: President (with
a copy to Xxxxx Xxxxxx)
12.7 Governing Law. This Agreement shall be governed
by and construed according to the laws of the State of Delaware.
12.8 Schedules. All Schedules referred to herein are
hereby incorporated in this Agreement by reference and have been
initialed for indemnification purposes by Xxxxxx X. Xxxxxxxxx
for VOLT and NEWCO, and by Xxxxx Xxxx for TRIPLE-I.
12.9 Headings. The various headings used in this
Agreement are for convenience only and are not to be used in
-112-
interpreting the text of the Article in which they appear or to
which they relate.
12.10 Counterparts. This Agreement may be executed
in two or more counterparts, each of which shall be deemed an
original, and all of which shall constitute one and the same
instrument.
12.11 Arbitration and Alternative Dispute
Resolution. If a dispute arises out of or relates to this
Agreement or the breach thereof and if the dispute cannot be
settled through negotiation, the parties agree first to try in
good faith to settle the dispute by mediation administered by the
American Arbitration Association under its Commercial Mediation
Rules before resorting to arbitration. If the matter has not
been resolved pursuant to the aforesaid mediation procedure
within ninety (90) days of the commencement of such procedure,
(which period may be extended by mutual agreement), or if either
party will not participate in such procedure, the controversy
shall be settled by arbitration in accordance with American
Arbitration Association Commercial Arbitration Rules by three
arbitrators who shall be appointed as follows: (i) one by VOLT,
(ii) one by TRIPLE-I if before the Closing or by the Minority
Directors of NEWCO if after the Closing, and (iii) one who shall
be appointed jointly by the initial two arbitrators and who shall
serve as the presiding arbitrator. The arbitration shall be
governed by the United States Arbitration Act, 9 U.S.C. Section 1-16,
and judgment upon the award rendered by the arbitrators may be
-113-
entered by any court having jurisdiction thereof. The place of
arbitration shall be in the City of Los Angeles or such other
location as the parties hereto may mutually agree. The
arbitrators are not empowered to award damages in excess of
actual damages.
IN WITNESS WHEREOF, the parties hereto have caused this
Agreement to be executed the day and year first written above.
VOLT INFORMATION SCIENCES, INC.
Attest:
/s/Xxxxxx X. Xxxxxxxxx By: /s/Xxxxxxx Xxxx
(Assistant Secretary) Name: Xxxxxxx Xxxx
Title: Chairman
INFORMATION INTERNATIONAL, INC.
Attest:
/s/Xxxxx X. XxXxxxx By: /s/Xxxxx X. Xxxx
(Assistant Secretary) Name: Xxxxx X. Xxxx
Title: Senior Vice President
AUTOLOGIC, INC.
Attest:
/s/Xxxxxx X. Xxxxxxxxx By: /s/Xxxxxxx Xxxx
(Assistant Secretary) Name: Xxxxxxx Xxxx
Title: Chairman
-114-
