Exhibit 10.32
ASSET CONTRIBUTION AGREEMENT
This Asset Contribution Agreement (the "Agreement") is made and
entered into this 1st day of October, 1996 by and between Pencom Systems
Incorporated ("PSI"), a New York corporation, and PSW Technologies, Inc.
("PSW"), a Delaware corporation.
WHEREAS, PSI desires to transfer to PSW, and PSW desires to acquire
certain assets and assume certain liabilities of PSI as hereinafter set forth.
NOW, THEREFORE, in consideration of the mutual covenants set forth
herein and for other good and valuable consideration, the receipt and
sufficiency of which is hereby acknowledged, the parties hereto agree as
follows:
1. Definitions. As used in the Agreement, the following terms shall
have the following meaning:
a. "Assets" shall mean (i) all Intellectual Property; (ii) all
licenses, franchises, permits, approvals or other similar authorizations; (iii)
all books, records, files and papers, whether in hard copy or computer format,
including, without limitation, research and development information, all
materials and analyses prepared by consultants and other third parties,
engineering information, sales and promotional literature, manuals and data,
sales and purchase correspondence, lists of present and former suppliers, lists
of present and former customers, personnel and employment records, and any
tax-related information; (iv) all goodwill; (v) all claims and choses in action;
(vi) all accounts, prepaid expenses, notes and other receivables; (vii) all
security deposits; (viii) all raw materials, parts, work-in-process, finished
goods, supplies and other inventories; (ix) all rights under all contracts,
agreements, leases, licenses, commitments, sales and purchase orders and other
instruments ("Contracts"); (x) all rights, claims, credits, causes of action or
rights of set-off against third- parties and (xi) all equipment, machinery,
improvements, furniture and fixed assets.
b. "Assumed Liabilities" shall have the meaning ascribed to
such term in Section 3 below.
c. "Business of PSW" shall mean the business and operations of
the software division of PSI, as currently conducted and proposed to be
conducted, and all activities associated therewith.
d. "Closing" shall mean the closing of the transactions
contemplated hereunder on the Closing Date.
e. "Closing Date" shall mean October 1, 1996.
f. "Intellectual Property" shall mean all (A) patents, patent
applications, patent disclosures and all related continuation,
continuation-in-part, divisional, reissue, re-examination, utility, model,
certificate of invention and design patents, patent applications, registrations
and applications for registration, (B) trademarks, service marks, trade dress,
logos, tradenames, service names and corporate names and registrations and
applications for registration thereof, (C) copyrights and registrations and
applications for registration thereof, (D) mask works and registrations and
applications for registration thereof, (E) computer software, data and
documentation, (f) trade secrets and confidential business information, whether
patentable or nonpatentable and whether or not reduced to practice, know-how,
manufacturing and product processes and techniques, research and development
information, copyrightable works, financial, marketing and business data,
pricing and cost information, business and marketing plans and customer and
supplier lists and information, (G) other proprietary rights relating to any of
the foregoing (including without limitation associated goodwill and remedies
against infringements thereof and rights of protection of an interest therein
under the laws of all jurisdictions) and (H) copies and tangible embodiments
thereof.
g. "Opening Balance Sheet" shall mean a balance sheet prepared
as of the Closing Date, in accordance with generally accepted accounting
principles from the books and records of PSI, setting forth the assets and
liabilities of PSW as at the Closing Date, attached hereto as Exhibit A.
h. "PSW Assets" shall mean all of the Assets used or useful in
and to the Business of PSW, including without limitation (i) the Assets set
forth on Exhibit B and (ii) all of the Intellectual Property related thereto.
i. "Shares" shall have the meaning ascribed to such term in
Section 2 below.
j. "Warrant" shall have the meaning ascribed to such term in
Section 2 below.
2. Transfer of Assets to PSW. In consideration for the issuance
to PSI of 800 fully paid, non-assessable shares of common stock of PSW (the
"Shares"), par value $.01 per share, (ii) issuance to PSI of a warrant to
purchase an aggregate of 28.8912 shares of common stock of PSW at a purchase
price of $276.9231 per share (the "Warrant"), in substantially the form
attached hereto as Exhibit C, and (iii) issuance to certain employees of PSI
listed on Exhibit D attached hereto of warrants to purchase such number of
shares of common stock of PSW as set forth opposite each such person's name
thereon (the "Employee Warrants"), each in substantially the form of Exhibit
D-1 attached hereto, PSI shall assign, transfer, convey and deliver to PSW,
in the form of a capital contribution, the PSW Assets, subject to the
liabilities of PSI related thereto as such liabilities appear on the Opening
Balance Sheet.
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3. Assumption of Liabilities by PSW. In further consideration for
the conveyance of the PSW Assets, PSW shall assume and agree to pay, perform and
discharge all debts, obligations, contracts and liabilities of PSI related to
the PSW Assets as set forth on the Opening Balance Sheet. All such liabilities
shall hereinafter collectively be referred to as the "Assumed Liabilities."
Notwithstanding any provision in this Agreement or any other writing to the
contrary, PSW is assuming only the Assumed Liabilities and is not assuming any
other liability or obligation of PSI.
4. Instruments of Conveyance and Transfer. At the Closing, the
parties hereto shall enter into an Assignment and Assumption Agreement in the
form of Exhibit E attached hereto, and PSI shall deliver to the PSW all
necessary bills of sale, endorsements, consents, assignments and other good and
sufficient instruments of conveyance and assignment as shall be reasonably
necessary to vest in PSW good and marketable title to the PSW Assets. PSI shall
take all such steps as may be necessary to put PSW in actual possession and
operating control of the PSW Assets. At the Closing, PSW shall deliver to PSI
(i) certificates representing the Shares and (ii) the Warrant and (iii) such
other documents (including the Employee Warrants) and undertakings as may be
necessary to reflect the obligations of PSW as herein set forth.
5. Representations of PSI. PSI hereby represents and warrants to PSW
that:
5.1 Corporate Existence and Power. PSI is a corporation duly
organized, validly existing and in good standing under the laws of its
jurisdiction of incorporation.
5.2 Corporate Authorizations. The execution, delivery and
performance by PSI of this Agreement and the consummation by PSI of transactions
contemplated hereby are within PSI's corporate powers and have been duly
authorized by all necessary corporate action on the part of PSI. This Agreement
constitutes the valid and binding agreement of PSI.
6. Further Assurances. From time to time, at PSW's request and
without further consideration, PSI will execute and deliver such other
instruments of conveyance and transfer and take such other action as PSW may
reasonably require to more effectively convey, transfer to, and vest in PSW, and
to put PSW in possession of, any property to be conveyed, transferred and
delivered hereunder, and, in the case of contracts and rights, if any, which
cannot be effectively transferred without the consent of third parties which is
unattainable, PSI will use its best efforts to ensure that PSW receive the
benefits thereof.
7. Consent of Third Parties. If a consent of a third party that is
required in order to assign any of the PSW Assets to PSW is not obtained prior
to the Closing Date, or if an attempted assignment would be ineffective or would
adversely affect the ability of PSI to convey its interest to PSW, PSI will
cooperate with PSW in any lawful and reasonable
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arrangement to provide that PSW shall receive the interest of PSI in the
benefits under any such instrument, contract, lease, permit or other agreement
or arrangement, including performance by PSI as agent except where prohibited by
law; and any transfer or assignment to PSW or by PSI of any interest under any
such instrument, contract, lease, permit of other agreement or arrangement that
requires the consent of a third party shall be made subject to such consent or
approval being obtained.
WHEREFOR, the parties hereto have executed this Agreement as of the date
first above written.
PENCOM SYSTEMS INCORPORATED
By:______________________________
Title:___________________________
PSW TECHNOLOGIES, INC.
By:______________________________
Title:___________________________
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