EXHIBIT 1
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Translation from the French
PARTIAL TRANSFER OF A BUSINESS
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BETWEEN THE UNDERSIGNED
- UNILOG REGIONS, a corporation with a capital of 11,986,300
francs having its registered office located 000, xxxxxxxxx Xxxxxxxxxx,
00000 Xxxxxxxxxxx, registered at the Register of Commerce, and Companies of
Lyon under number B 340 529 643, represented by Xx. Xxxx-Xxxxxxx Xxxxxxxx,
Director of Development, duly empowered for the purposes hereof pursuant to
a power-of-attorney granted by Xx. Xxxxxx Xxxxxxxx, President, on December
11, 1998,
(hereinafter referred to as the "Seller")
ON THE ONE HAND,
AND
- SAMBA TECHNOLOGIES, a limited liability company with a capital
of 50,000 francs, having its registered office located 00, xxxxxx xx Xxxxx
Xxxxx, Xxxxxxxx Xxxxxxx, 00000 Meylan, currently being incorporated at (he
Register of Commerce and Companies of Grenoble, represented by Xx. Xxxxxxx
Xxxxxx,
(hereinafter referred to as the "Purchaser")
ON THE OTHER HAND,
WHEREAS:
The Seller operates an autonomous branch of activity of medical images
known under the trademark SAMBA which constitutes a part of its business of
software engineering operated in Meylan (Isere), 00, xxxxxx xx Xxxxx Xxxxx,
Xxxxxxxx Epilobe, regarding which it is registered at the Register of
Commerce and Companies under number B 340 529 643 and at the INSEE under
the SIREN number 340 529 643, APE code.
The Seller has declared that it is willing to sell the aforesaid part of
its business and the Purchaser has declared that it is interested in
purchasing it, under the terms and conditions set forth below.
THE PARTIES HAVE AGREED AS FOLLOWS:
ARTICLE 1 - PROMISE OF SALE
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The Seller hereby sells under the customary conditions in such operations,
to the Purchaser, who accepts, the part of his business described
hereafter.
ARTICLE 2 - DESIGNATION OF THE BUSINESS
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The aforesaid business is constituted of the following:
- the trade name, customers and attached trade;
- the intellectual property rights and in particular the
operating rights attached to the "SAMBA" (Systeme d'Analyses Microscopiques
a Balayage Automatique dans le domaine de la biologie) software package, it
being specified that said package has not been patented;
- the "SAMBA" trademark, as registered at the INPI on March 25,
1992 under No. 1 215 709 in classes 9 and 10;
- the rights and obligations relating to the agreements,
contracts and commitments taken by the Seller in connection with the
operation of the part of the business concerned and in particular the
commercial contracts;
- the benefit of the licenses for the use of third party
software;
- the technical and commercial archives and all documents
relating to the part of the business concerned;
- the material, tools, equipment and furniture used for the
operating of said business (with the exception of the fittings and
installations present in the premises where said business is currently
being operated), as described and estimated item by item in a statement
which will be drawn up jointly by the parties at closing (on an indicative
basis, the list of the material, tools, equipment and furniture currently a
part of the business, is attached as Exhibit 1);
- the merchandise existing in the business, as such will be
described and estimated in inventory which shall be drawn up by the two
parties at the time Purchaser takes possession of the business;
Such as this business exists, with all of its tangible and intangible
elements without any exceptions or reserves, it being however specified
that this business does not include any right to a commercial lease and
that the Purchaser will make it its business to transfer the part of the
business it is buying to other premises, within the delay stipulated in
article 6 hereafter.
ARTICLE 3 - DECLARATIONS
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In accordance with article 12 of the law of June 29, 1935, the Seller makes
the following declarations:
Origin of title
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The Seller declares that it is the owner of the business for having
received it as a partial contribution of assets from ALCATEL TITN Answare
effective June 1, 1996. The contribution deed is attached hereto as
Exhibit 2.
Liens
-----
The Seller declares that there are no liens or other encumbrances on the
business being sold and undertakes, in the event that any lien or
encumbrance should be revealed, to pay them off and to have them cleared
within a maximum of four months from the date of Closing.
Turnover
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The Seller declares that the turnover generated by the part of business
being sold in the course of the past three years, is as follows:
July 1, 1996 to December 31, 1996: 2,541,400 francs
FY 1997: 6,862,394 francs
January 1, 1998 to November 31, 1998: 4,052,881 francs
Regarding commercial profits, the Seller declares that the part of business
being sold was operated as part of its global activity and that in the
absence of separate accounts, it can neither declare nor guarantee any
operating results.
As a consequence and as an exception to the provisions of the law of
June 29, 1935, the Purchaser expressly waives its right to such information
and to any recourse against the Seller regarding a modification to the
price and to the conditions of the sale.
Other declarations
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The Seller further declares:
- that there is nothing in its legal situation which might
prevent it from selling the business and the Purchaser from enjoying its
possession, namely further to a receivership or liquidation, bankruptcy or
total or partial confiscation of its assets;
- that all of the installations of the business are in good
working order and in conformity with applicable regulations in the fields
of public health, hygiene and safety;
- that there are no other employment contracts with personnel
employed in the establishment other than those listed in an exhibit hereto
and that such employment agreements do not contain any unusual provisions,
regarding namely the payment of premiums, advantages in kind, pensions and
retirement. The list of the personnel currently employed in the business
is attached hereto as Exhibit 3, it being confirmed that such personnel
have always been employed in connection with the business being sold, with
the exception of exceptional and punctual missions within the Unilog group;
- that it has not given any third party, whether client or
supplier, any guarantee of proper performance or of results;
- that, more generally, the Seller is not involved, nor about to
be involved, in any suit or legal proceeding regarding the part of business
to be sold, it being however specified that CELL ANALYSIS SYSTEMS INC
notified a claim against DYNATECH Laboratories Inc. on May 31, 1991 and
that there has not been any follow-up on this claim since October 29, 1991;
- that, to the best of its knowledge, the SAMBA system is not a
violation of any third party rights of whatever nature and that it has not
received any notification of any breach or infringement of third party
intellectual property rights and that it has no knowledge of any other
claim notified against any of its distributors and/or customers in relation
to the SAMBA system;
- that the SAMBA system, as it is commercialized by the Seller,
is in conformity with currently applicable legislation;
- that it has not made any commitment, nor any promise or
agreement relating to the operating of the business which might be
terminated as a result of the change of identity of one of the parties,
other than the agreements currently in force with its customers XXXXXX and
EUROPATH.
The Purchaser declares that it has never been condemned nor the subject of
any civil or administrative penalty of a nature to prohibit it from
exercising a commercial activity.
ARTICLE 4 - CHARGES AND CONDITIONS
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The sale is made and accepted under the customary and legal conditions, and
namely the following:
For the Seller:
- to pay all expenses, charges and disbursements relating to the
operating of the business until the Buyer takes possession;
- to guarantee to the Buyer, in accordance with article 1641
et seq. of the Civil Code, the declarations made with respect to the origin
of title, the liens on the business and the turnover for the past three
years;
- to assist the Buyer, at its request, for the first three months
following the entry into possession, to present the Buyer to its clients
and suppliers and to inform it of any particular issues regarding the
business;
- the keep its accounting books at the disposal of the Buyer for
a period of three years following the entry into Possession;
- to remit to the Buyer all title deeds, insurance policies and
generally all acts and documents regarding the business which are in its
possession;
- to pay to the Buyer, no later than January 31, 1999, all
charges which the latter might have to pay relating to the period prior to
its entry into possession, including in particular the total cost of all
salaries, premiums or indemnities of whatever nature (and namely seniority
indemnities, premiums on objectives, paid vacation indemnities, 13th month
indemnities...) as well as the total cost of all taxes, duties and
contributions, of whatever nature (and namely the tax on salaries,
apprenticeship tax, participation to professional training, participation
to the effort of construction, social contribution of solidarity, tax on
company cars put at the disposal of employees...) and all other sums which
might become due, even if not yet outstanding (and namely
social contributions due in connection with salaries and
premiums due), but payable after said date to employees as well as to any
interim third parties or independent subcontractors, relating to the
performance of the aforesaid employment agreements prior to the effective
date of the sale. It is specified that the Seller has not made any reserves
for the retirement of the employees to be transferred and that the possible
corresponding costs will he borne by the Purchaser;
- to reimburse to the Buyer, as provided in article 5 hereafter,
any advances received from clients;
- to sign any deeds of assignment for existing contracts and
policies and, namely, to do all in its power to allow for the transfer of
any ongoing services to the Buyer;
- to refrain from operating or managing, directly or indirectly,
any business similar in total or in part to the one being sold, to take an
interest in any manner whatsoever in a business of a same nature, for a
period of ten years from the date of entry into possession, in any part of
the European Community, failing which the Seller shall have to indemnify
the Buyer or its successors or assigns, without prejudice to the right they
would have to have ordered the ceasing of any such violation;
- to refrain, for a period of two years from the effective date
hereof, from offering employment within the Unilog group in the territory
protected by the above non-compete undertaking, to any employee transferred
to the Buyer hereunder, without the prior written consent of the Buyer;
- to indemnify the Buyer for any loss it might suffer as a
consequence of an erroneous declaration or of the failure for the Seller to
perform any of its obligations hereunder;
- to indemnify the Buyer for any loss it might suffer as a result
of a claim relating to the SAMBA system, it being agreed:
. that the possible indemnification will not in any
case exceed 2,000,000 francs;
. that the present warranty is limited to any loss
caused by an event prior to December 31, 1998 and revealed before August
31, 1999 and, for any loss relating to the developments realized by Unilog
between July 1, 1996 and December 31, 1998, to losses revealed prior to
December 31, 1999.
For the Purchaser:
- to take the business, and all the elements thereof, "as is,
where is" on the date of entry into possession, without any right to any
indemnity nor to any price reduction for any reason whatsoever, namely
further to bad functioning or bad state of the material and equipment;
- to pay all taxes, contributions, duties and other charges of
whatever nature relating to the operating of the business as from the date
of entry into possession, even if such were still in the name of the Seller
and to respect all applicable regulations regarding the operating of the
business in such a way that no action may ever be taken against the Seller
in this respect;
- to take all necessary action regarding the continuation or the
termination of any insurance policies and, in this second case, to
subscribe to insurances with notably solvent insurance companies offering
guarantees at least equal to those provided in the Seller's current
policies;
- to continue, in accordance with article L 122-12 of the Labor
Code, the employment contracts for the personnel working with the business
being sold, at the same conditions of remuneration and seniority, it being
reminded that the Seller shall reimburse to the Buyer, prorata temporis,
the paid vacations, premiums and indemnities of any nature whatsoever as
well as the corresponding social security contributions and salary-based
taxes and duties;
- to continue until fully performed all on-going agreements with
customers, suppliers or sub-contractors;
- to supply any technical assistance which may be required by
ALCATEL NV in connection with the recourse filed by ALCATEL NV after
opposition to the European patent No. 86907142.3-2116/245466 requested by
CELL ANALYSIS SYSTEMS Inc.;
- to reimburse to the Seller, as provided in article 6 hereunder,
the part of the services supplied by the Seller and not yet invoiced at the
date of entry into possession, it being specified that this reimbursement
shall be made within one month from the effective receipt of the sums
invoiced to the customers by the Buyer;
- to pay the agreed price, as well as all costs, taxes and fees
relating to the present sale and to the corresponding deed and any deed
which could result therefrom.
ARTICLE 5 - REIMBURSEMENT OF THE CHARGES AND INCOME RELATING TO ORDERS
AND WORK IN PROCESS
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Upon the entry into possession, the Buyer shall only be liable toward the
third parties concerned for payments and/or obligations relating to the
supply of goods or services not yet delivered at that date, whatever the
state of invoicing at said same date. In this respect, the Buyer
undertakes to reimburse to the Seller any part of the price paid in advance
by the Seller.
Upon the entry into possession, the Purchaser shall only be entitled to
payments and/or obligations relating to the sale of goods or supply of
services not yet delivered or supplied at the effective date hereof. In
this respect, the Seller undertakes to reimburse to the Purchaser any part
of the price of a sale or of a service paid in advance by a customer to the
Seller.
The products and services delivered prior to the entry into possession but
not yet invoiced at that date for administrative or contractual reasons,
shall be evaluated in accordance with the rules applied in the Unilog
group, as such are indicated in exhibit 4.
It is specified that in the event of a divergence of interpretation in the
evaluation of charges and income relating to orders and work in process,
the rules and methods applied as at 31/12/97 for the closing of the
Seller's accounts, shall be applied.
The balance of the charges and income mentioned above, determined as of the
date of entry into possession, shall be established no later thin
January 31, 1999 and shall be certified by the statutory auditor of the
Seller. It shall be paid to the creditor prior to February 28, 1999.
ARTICLE 6 - SUBLEASE
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The Seller grants to the Purchaser, by separate agreement, a sublease to
the part of the premises in which the business is currently being operated,
for a maximum duration of 6 months from the date of entry into possession.
ARTICLE 7 - TRANSFER OF OWNERSHIP AND OF POSSESSION
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The Purchaser shall have full ownership of the part of business being sold
as from the date hereof. He shall come into real and effective possession
no later than January 1, 1999.
As from that date, he shall have the right to exercise all rights and
prerogatives attached to the business and to take on the quality of
"successor to the Seller".
ARTICLE 8 - PRICE
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The sale is made and accepted for the principal price of 3,200,000 francs,
as follows:
- intangibles elements: 3,100,000 francs
- intangible elements: 100,000 francs
The Purchaser has already paid to Seller, prior to the date hereof, a sum
of five hundred and sixty thousand francs.
The balance, i.e., the sum of two million six hundred and forty thousand
francs, is paid now by cheque made out to the CAISSE DES DEPOTS ET
CONSIGNATIONS, designed by mutual consent of the parties to be the
Depository of the price and to keep the funds until the Seller is entitled
to dispose of them as provided by the law.
The Seller acknowledges receipt of this sum.
The allocation of the price given above is only made to satisfy the
provisions of article 1 of the law of 17th march 1909, but will not be of
any consequence and will not give rise to any claim as to the value of the
aforesaid elements taken separately.
The merchandise attached to the business shall be taken for their purchase
price, on the basis of an inventory drawn up by the parties at the time of
the entry into possession.
In the event that the parties should not agree on the valuation of said
merchandise, the price will be determined by an expert appointed by the
parties or by the President of the Commercial Court of Grenoble at the
request of the most diligent party.
The merchandise shall be paid for in full upon remittance of the final
inventory, plus VAT.
ARTICLE 9 - ESCROW
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Seller and Purchaser have agreed to place the sum of two million six
hundred and forty thousand francs, representing the balance of the price
for the sale of the business, in the hands of the CAISSE DES DEPOTS ET
CONSIGNATIONS, hereafter refered to as the "Depository", chosen jointly, in
order for that sum to be blocked in an account opened in the name of the
Seller in accordance with the request for placement of the escrowed funds
signed this day by the Seller by separate deed, for the period required for
the carrying-out of the formalities referred to hereunder.
9.1 Mission of the Depositary
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The Depositary has, by letter dated December 24, 1998 attached hereto,
declared that it accepts the mission entrusted to it hereunder.
The Depositary shall immediately open in its books an account in the name
of the Seller. The sum paid into the hands of the Depositary shall remain
blocked on said account during the period of unavailability resulting from
the provisions of the law of March 17, 1909 as well as during the period
during which the Purchaser is jointly liable with the Seller for the
payment of the income tax owed by the latter under the conditions set forth
in article 1684-1 of the General Tax Code.
The Depositary undertakes to inform the Escrow Agent appointed hereunder,
upon receipt, of any oppositions formed on the account which might be
notified to it in error.
9.2 Mission of the Escrow Agent
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The parties have jointly appointed BFL Associes, attorneys-at-law, 00/00
xxxxxx Xxx Xxxxx, 00000 Xxxxx, who accepts, to carry out the formalities
prescribed by law in connection with the transfer of a business. The
Escrow Agent is appointed to receive the oppositions at its professional
address. The Escrow Agent, after having carried out the formalities
required and received the oppositions, shall notify the Depositary, in the
absence of a higher bid, the allocation of the funds and shall, if
appropriate, consign said sums in accordance with the law.
9.3 Anticipated withdrawal
--------------------------
The total or partial withdrawal of the funds may not occur before the end
of the period of unavailability provided by the law unless the Escrow
Agent, who must make this request, produces with such request, made by
recorded delivery mail, a special power signed jointly by the Seller and
the Purchaser, authorizing the release of the funds and indicating the
beneficiary.
9.4 Financial outcome
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At the agreed date, the Depositary will release the funds in its account in
favor of the beneficiaries which will be designated in writing by the
Escrow Agent, who will be entitled to act alone.
The performance by the Depositary of the orders given by the Escrow Agent
shall release the Depositary from any liability.
ARTICLE 10 - JURISDICTION
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Any disputes relating to the interpretation or the performance hereof shall
be submitted to the exclusive jurisdiction of the Commercial Court of the
place where the business is operated.
ARTICLE 11 - TAX DECLARATIONS
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The Seller, within 10 days from the first publication of this sale, shall
notify same to the tax administration.
In accordance with the provisions of instruction 3A-6-90 published at the
B.O. dated 22/2/1990, the sale of investment personal property is exempt
from VAT.
The Purchaser undertakes to submit to VAT any subsequent sales of
investment personal property and, if appropriate, to perform the
regularizations provided by articles 210 and 215 of Annex II of the General
Tax Code which would have become due if the Seller had continued to use
said goods.
The Purchaser sends two copies of a declaration to the tax administration
from which it depends.
The undersigned declare, under the penalties provided by article 1837 of
the General Tax Code, that this agreement reflects the entire agreed price
and acknowledge that they have been informed of the penalties incurred in
the event of a misrepresentation.
ARTICLE 12 - ELECTION OF DOMICILE
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The parties each elect domicile at their respective registered office.
ARTICLE 13 - COSTS - POWERS
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The costs and taxes relating to this sale shall be borne by the Purchaser.
All powers are granted to the holder of an original hereof to accomplish
all formalities or to request any documents needed for the drafting of the
sale agreement.
Signed in Paris
On December 31, 1998
In five originals
The Seller The Purchaser
/s/ Xxxxxx Xxxxxxxx /s/ Xxxxxxx Xxxxxx
EXHIBIT 4
Analytical accounting rules of the Unilog group
Accounting of products to be invoiced
Services in progress which have been carried out but not yet invoiced to
the clients due to administrative procedure or contractual reasons, are
valued according to the method of "advancement".
Time spent by the engineers and technicians is valued in terms of sale
price on the basis of the advancement of the project, deduction made of the
losses which may be projected at termination.
Outside any clearly identified risk, a reserve equal to 5% of the software
turnover and to 10% of the equipment turnover is made and deducted from the
income projected under the agreement in order to face the warranty
obligations. The balance of this reserve is reintegrated into income at
the end of the warranty period.
OMITTED EXHIBITS.
Xxxx National Corporation (the "Company") believes that the following
Exhibits to the Partial Transfer of a Business are not material to an
investment decision and therefore has not obtained translations of them to
include in this Exhibit 1 to Form 8-K. The Company agrees to furnish to
the Securities and Exchange Commission copies of the omitted Exhibits upon
request.
Exhibit No.: Contents:
Exhibit 1 List of material, tools, equipment and furniture
currently a part of the SAMBA business unit.
Exhibit 2 Contribution Deed, whereby ALCATEL TITN Answare
contributed the SAMBA business unit to Unilog Regions, SA as a partial
contribution of assets, effective June 1, 1996.
Exhibit 3 Personnel currently employed in the SAMBA business
unit.
