ELTRAX SYSTEMS PTY LTD
AREMISSOFT AUSTRALIA PTY LIMITED
AREMISSOFT CORPORATION
ELTRAX INTERNATIONAL, INC
VERSO TECHNOLOGIES, INC
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DEED OF SALE AND PURCHASE
OF BUSINESS
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CORRS XXXXXXXX WESTGARTH
Lawyers
Xxxxx 00, Xxxxxxxx Xxxxxxx Tower
0 Xxxxxx Xxxxx
XXXXXX XXX 0000
XXXXXXXXX
Tel: (00) 0000 0000
Fax: (00) 0000 0000
DX: 000 XXXXXX
Ref:
S/1096829
CONTENTS
1 INTERPRETATION............................................................................................1
1.1 Definitions.....................................................................................1
1.2 Construction....................................................................................6
1.3 Headings........................................................................................7
2 TRANSACTION...............................................................................................7
2.1 Sale and purchase of the Business...............................................................7
2.2 Assumed Liabilities.............................................................................7
2.3 Representations.................................................................................7
2.4 Inconsistency...................................................................................8
2.5 Purchase Price apportionment....................................................................8
3 PURCHASE PRICE............................................................................................8
3.1 Time and manner of payment......................................................................8
4 COMPLETION................................................................................................8
5 AGREEMENT TO ACQUIRE FOREIGN OPERATIONS...................................................................8
6 CONDITIONS TO COMPLETION..................................................................................8
6.1 Conditions to obligation of Purchaser...........................................................8
6.2 Conditions to obligation of the Vendor.........................................................10
7 EMPLOYEES................................................................................................10
7.1 Offers of Employment...........................................................................10
7.2 Vendor's Obligation to Transferring Employees..................................................11
7.3 Purchasers Obligation to Transferring Employees................................................11
7.4 Indemnity......................................................................................11
8 COVENANTS OF THE PURCHASER...............................................................................11
8.1 Affirmative Covenants..........................................................................11
8.2 Cooperation....................................................................................12
8.3 Expenses.......................................................................................12
8.4 Publicity......................................................................................12
8.5 Cooperation....................................................................................12
9 covenants of the vendor..................................................................................13
9.1 Affirmative covenants..........................................................................13
9.2 Covenant not to compete........................................................................13
9.3 Access and information.........................................................................13
9.4 No solicitation................................................................................14
9.5 Conduct of Business pending the Transactions...................................................14
9.6 Cooperation....................................................................................15
9.7 Expenses.......................................................................................16
9.8 Publicity......................................................................................16
9.9 Updating the Schedules and Disclosure Documents................................................16
9.10 Payment of Unassumed Liabilities...............................................................16
10 INDEMNITY BY Vendor......................................................................................16
11 INDEMNITY BY PURCHASER AND PURCHASER'S GUARANTOR.........................................................17
12 Remedies.................................................................................................17
12.1 Procedures.....................................................................................18
12.2 Negotiation....................................................................................18
12.3 Failure to Respond.............................................................................18
12.4 Co-operation...................................................................................18
12.5 Initial Limitation.............................................................................19
12.6 Aggregate Limitation...........................................................................19
12.7 Available Insurance Limitation.................................................................19
12.8 Accounts Adjustment Limitation.................................................................19
12.9 Application of Indemnification Provisions......................................................20
13 PURCHASER'S GUARANTOR....................................................................................20
14 TERMINATION..............................................................................................20
15 AMENDMENT................................................................................................21
16 WAIVER...................................................................................................21
17 RELIEF...................................................................................................21
18 WARRANTOR'S OBLIGATIONS..................................................................................21
18.1 Guarantee......................................................................................21
18.2 Indemnity......................................................................................22
18.3 Guarantee not to be affected...................................................................22
18.4 Continuing guarantee...........................................................................22
18.5 No competition.................................................................................22
18.6 Guarantee in addition to other rights of the Purchaser.........................................22
18.7 Representations by the Warrantor...............................................................23
19 GST......................................................................................................23
19.1 Definitions....................................................................................23
19.2 Sums exclude GST...............................................................................23
19.3 Responsibility for GST.........................................................................23
19.4 Supply of going concern........................................................................23
19.5 Reimbursement of expenses......................................................................24
19.6 Tax invoice....................................................................................24
20 GENERAL PROVISIONS.......................................................................................24
20.1 Collection of Accounts Receivable..............................................................24
20.2 Arbitration....................................................................................25
20.3 Notices........................................................................................25
20.4 Interpretation.................................................................................26
20.5 Survival of Representations and Warranties.....................................................26
20.6 Miscellaneous..................................................................................26
SCHEDULE 1 - WARRANTIES.............................................................................................28
1 REPRESENTATIONS AND WARRANTIES OF PURCHASER..............................................................30
2 REPRESENTATIONS AND WARRANTIES OF THE VENDOR.............................................................31
SCHEDULE 2 - DISCLOSURE DOCUMENT....................................................................................41
SCHEDULE 3 - ACCOUNTS...............................................................................................43
SCHEDULE 4 - EMPLOYEES..............................................................................................44
THIS DEED is made on 2000
BETWEEN Eltrax Systems Pty Ltd ACN 053 993 025 a company incorporated in
Australia of, Unit A, Xxxxx 0, 00 Xxxxxxxxxx Xxxx, Xxxxxxx Xxxxxx, Xxx
Xxxxx Xxxxx ("Vendor")
AND AREMISSOFT Australia Pty Limited ACN 094 649 377 a company incorporated in
Australia of Unit A, Xxxxx 0, 00 Xxxxxxxxxx Xxxx, Xxxxxxx Xxxxxx, Xxx Xxxxx
Xxxxx ("Purchaser")
AND AremisSoft Corporation of 000 Xxxxxx Xxxxxx, Xxxxx 000, Xxxxxxxx XX 00000
("Purchaser Guarantor")
AND Eltrax International Inc and Verso Technologies Inc. both of 000 Xxxxxxxx
Xxxxxxx, Xxxxx 000, Xxxxxxx, XX 00000 ("Warrantor")
-RECITALS:
A The Vendor is the owner of and carries on the Business.
B The Vendor desires to sell the Business including the Goodwill as a going
concern and the Purchaser has agreed to purchase the Business for the
Purchase Price on the terms of this Agreement.
C To induce the Purchaser to enter into this document the Vendor and the
Warrantor have made representations to the Purchaser in the terms of the
Warranties with the intention that the Purchaser should rely upon the
Warranties.
D. To induce the Vendor to enter into this document the Purchaser has made
representations to the Vendor in terms of the Warranties with the intention
that the Vendor should rely upon the Warranties
E The Warrantor has agreed to guarantee the performance by the Vendor of the
Vendor's obligations under this Agreement in consideration of the Purchaser
entering into this Agreement.
F The Purchaser's Guarantor has agreed to guarantee the performance by the
Purchaser of the Purchaser's obligations under the Agreement in
consideration of the Vendor entering into the Agreement.
it is agreed
1 INTERPRETATION
1.1 Definitions
In this Agreement:
"Accounting Standards" means:
(a) the accounting standards as defined in the Corporations Law;
(b) where not inconsistent with the accounting standards referred to in
paragraph (a) Australian Accounting Standards; and
(c) where not inconsistent with the accounting standards referred to in
paragraph (a) or Australian Accounting Standards, generally accepted
accounting principles and practices in Australia consistently applied.
"Accounts" means profit and loss accounts and balance sheet of the Vendor and
includes all statements, reports and notes attached to or intended to be read
with any of those profit and loss accounts or balance sheets and where
appropriate:
(a) financial statements required under Division 4 of Part 3.6 of the
Corporations Law;
(b) a copy of the director's statement under section 301 of the Corporations
Law; and
(c) a copy of the auditor's report under section 332 of the Corporations Law,
a copy of which comprises Schedule 3
"Accounts Date" means 30 September 2000.
"Agreement" means this Agreement for the Purchase and Sale of Assets, including
all of the Schedules specifically referred to in this Agreement that are or have
been delivered by a party to this Agreement to another party in connection with
the Agreement, and including all duly adopted amendments, modifications, and
supplements to or of this Agreement.
"Assets" means all assets used in the Business including without limitation:
(a) the Intellectual Property;
(b) the Software Products; and
(c) all other assets of the Vendor, tangible or intangible (including
contractual warranty, and other rights), the use or value of which is
related to the assets so identified.
"Assumed Liabilities" means those known Liabilities reflected in the accounting
records of the Vendor to be assumed by the Purchaser pursuant to this Agreement,
consisting of those known and absolute Liabilities reflected in the Balance
Sheet, effected through the operation of the Business in the ordinary course and
no other Liabilities.
"Australian Accounting Standards" means the accounting standards issued by the
Institute of Chartered Accountants in Australia and the Australian Society of
Certified Practising Accountants.
"Balance Sheet" means the Balance Sheet as at 30 September 2000 included with
the Accounts and as set out in Schedule 3.
"Balance Sheet Gains" means any realisation with respect to any current Asset in
excess of its value as reflected in the Accounts (as adjusted to account for any
ordinary course changes prior to the Completion Date), or any positive
realisation with respect to any liability reflected in the Accounts (as adjusted
to account for any ordinary course changes prior to the Completion Date).
"Business" means the Vendor's development and distribution of software and
hardware for the hospitality industry and associated businesses as at the date
of this agreement.
"Business Day" means a day on which trading banks are open for general banking
business in Sydney, Australia and Atlanta, United States of America.
"Completion" means completion of the sale and purchase of the Business in
accordance with the terms of this Agreement.
"Completion Date" means the date on which the sale and purchase of the Business
is completed, in accordance with clause 2.1.
"Corporations Law" means the Corporations Law and the Corporations Regulations
in each Australian jurisdiction and (where the context so permits) includes any
statute, ordinance, code or any prior corresponding legislation.
"Disclosure Document" means the document delivered by the Vendor to the
Purchaser containing certain disclosures relative to this Agreement, a copy of
which is attached as Schedule 2.
"Employees" means all the employees of the Vendor engaged in the Business
including, those listed in Schedule 4.
"Entity" means a corporation, partnership, sole proprietorship, joint venture,
or other form of organisation formed for the conduct of a business, whether
passive or active.
"Guarantee" means the guarantee and indemnity granted by the Warrantor to the
Purchaser by clause 18.
"Guarantee and Indemnity" means the guarantee and indemnity granted by the
Warrantor to the Purchaser in accordance with clause18.
"Intellectual Property" means all Software Products (including but not limited
to, all versions, renewals, modifications and extensions of any Software
Product), patents, applications, trade and service marks, trade and service xxxx
registrations, business names, copyrights, licenses, sub-licenses, inventions,
trade secrets, technology, know-how, domain names, customer lists, prospect
lists and other similar intangible property.
"Inventories" means the stock of raw materials, work in progress and finished
goods, including but not limited to finished goods purchased for resale, held by
the Vendor for manufacturing, assembly, processing, finishing, sale or resale to
others from time to time in the ordinary course of business of the Vendor in the
form in which such inventories are then held or after manufacturing, assembling,
finishing, processing, incorporating with other goods or items, refining and the
like.
"Liabilities" at any point in time ("The Determination Time"), the obligations
of a person or Entity, whether known or unknown, contingent or absolute,
recorded on its books or not, arising or resulting in any way from facts,
events, agreements, obligations or occurrences that existed or transpired at a
prior point in time, or resulted from the passage of time to the Determination
Time.
"Loss" means any loss (including loss of profit and loss of expected profit),
claim, action, liability, damage, cost, charge, expense, diminution in value or
deficiency of any kind or character which the Purchaser pays, suffers or incurs
or is liable for including, without limitation:
(i) all liabilities on account of Taxes;
(ii) all interest and other amounts payable to third parties; and
(iii) all legal(on a full indemnity basis) and other expenses incurred in
connection with investigating or defending any claim or action,
whether or not resulting in any liability and all amounts paid in
settlement of claim or action.
"Principal Agreement" means the Agreement for the Purchase and Sale Assets
between AremiSsoft Corporation, a Delaware Corporation as Purchaser, Eltrax
Systems, Inc, a Minnesota Corporation and Eltrax Hospitality Group, Inc., a
Georgia Corporation, as Seller and dated on or about the date of this Agreement.
"Projections" means the projections of economic results of the Business prepared
by the Vendor on a monthly basis through 31 December 2000 and delivered to the
Purchaser pursuant to the terms of this Agreement. Such Projections include,
separately and consolidated, projected financial results for each separate
business operation of the Business.
"Property Plant and Equipment" means all property plant and equipment used in
the Business and reflected in the Balance Sheet.
"Proprietary Rights" means trade secrets, copyrights, patents, trademarks,
service marks, customer lists, and all similar types of intangible property
developed created or owned by the Vendor in connection with the Assets or used
by the Vendor in connection with its business, whether or not the same are
entitled to legal protection.
"Purchase Price" means USD$300,000.00.
"Receivables" means accounts receivable, notes receivable and other obligations
appearing as assets in the books of the Vendor, and customarily reflected as
assets in the Accounts of the Vendor prepared in accordance with Australian
Accounting Standards, indicating monies owed to the Vendor.
"Related Transaction" means the sale by Verso Technologies Inc and Eltrax
Hospitality Systems Inc of its assets and liabilities of its operations
currently conducted in the foreign jursidictions of Belgium (Eltrax Group Inc),
Hong Kong (Eltrax Hospitality Ltd), Malayasia (Eltrax Malayasia) SBD. HD, Norway
(Eltrax Systems Scandanavia AS), Singapore (Eltrax Systems Pty Ltd), Switerland
(Eltrax Holdings AG) and the United Kingdom (Eltrax UK Limited).
"Software Products" means any instruction or instructions, in source code, or
object code format, for controlling the operation of any computer processing
unit together with all user documentation related thereto, and the Great Plains
Software Australasian Partnership Agreement between Sulcus Australia Pty Ltd and
Great Plains Software Pty Ltd.
"Taxes" includes:
(a) all taxes levied, imposed or assessed under the Income Tax Assessment
Act or any other statute, ordinance or law, in Australia or elsewhere;
and
(b) taxes in the nature of sales tax, consumption tax, value added tax,
payroll tax, group tax, PAYE, undistributed profits tax, fringe
benefits tax, recoupment tax, withholding tax, land tax, water rates,
municipal rates, stamp duties, gift duties or other state, territorial
goods and services tax, Commonwealth or municipal charges or
impositions levied, imposed or collected by any government body
together with any additional tax, interest, penalty, charge, fee or other amount
of any kind assessed, charged or imposed in relation to the non, late or short
payment of the same or the failure to file any return.
"Transaction" means the sale of the Assets, and the assumption of the Assumed
Liabilities, for the Purchase Price as provided for, and subject to the terms
and conditions of this Agreement.
"Transferring Employee" means all of the Employees of the Vendor who accept the
Purchaser's offer of employment.
"Unaudited Financial Statements" means the Balance Sheet as at 30 September
2000, the financial statements for the period ended 31 December 1999 and the
related notes prepared for the Business, but excluding the Excluded Assets,
prepared in accordance with Australian Accounting Standards.
"US Transaction" means the Agreement for the Sale and Purchase of Assets between
AremisSoft Corporation, a Delaware Corporation, as Purchaser, Eltrax Systems,
Inc,. a Minnesota corporation, and Eltrax Hospitality Group Inc., a Georgia
Corporation, as Seller.
"Warranties" means all of the representations of the Vendor and the Purchaser in
this document including those set out in Schedule 1.
1.2 Construction
Unless expressed to the contrary:
(a) words importing:
(i) the singular include the plural and vice versa;
(ii) any gender includes the other genders;
(b) if a word or phrase is defined cognate words and phrases have
corresponding definitions;
(c) a reference to:
(i) a person includes a firm, unincorporated association, corporation
and a government or statutory body or authority;
(ii) a person includes its legal personal representatives, successors
and assigns;
(iii)a statute, ordinance, code or other law includes regulations and
other statutory instruments under it and consolidations,
amendments, re-enactments or replacements of any of them;
(iv) a right includes a benefit, remedy, discretion, authority or
power;
(v) an obligation includes a warranty or representation and a
reference to a failure to observe or perform an obligation
includes a breach of warranty or representation;
(vi) provisions or terms of this document or another document,
agreement, understanding or arrangement include a reference to
both express and implied provisions and terms;
(vii) time is to local time in Sydney, Australia;
(viii)"USD$" or "US dollars" is a reference to the lawful currency of
the United States;
(ix) writing includes any mode of representing or reproducing words in
tangible and permanently visible form, and includes facsimile
transmissions; and
(x) any thing (including, without limitation, any amount) is a
reference to the whole or any part of it and a reference to a
group of things or persons is a reference to any one or more of
them.
(d) a reference to this document includes all schedules, annexures and
appendices referred to in it;
(e) the Warranties are to be construed separately, and the meaning of each
Warranty is in no way limited by reference to any other covenant,
warranty or representation contained in this document; and
(f) no written statement by or on behalf of the Vendor or any third party
or state of knowledge of the Purchaser contrary to the Warranties
other than the Disclosure Letter is to result in or cause the waiver
of any or all of the Warranties.
1.3 Headings
Headings do not affect the interpretation of this document.
2 transaction
2.1 Sale and purchase of the Business
On the Completion Date subject in all instances to each of the terms and
conditions contained in this Agreement, the Vendor shall sell, transfer,
convey, and assign to the Purchaser, by instruments reasonably satisfactory
in form and substance to the Purchaser, and the Purchaser shall acquire
from the Vendor, the Assets, and shall assume the Assumed Liabilities, and
only those Liabilities, in exchange for the Purchase Price.
2.2 Assumed Liabilities
(a) The parties agree that the Purchaser is not assuming, becoming liable
for, or agreeing to discharge or in any manner becoming in any way
responsible for any of the Liabilities of the Vendor other than the
Assumed Liabilities. The Purchaser hereby agrees to pay, perform, or
discharge all of the Assumed Liabilities.
(b) The Purchaser agrees that its obligation to pay and discharge the
Assumed Liabilities is continuing and will not merge or be
extinguished on Completion.
2.3 Representations
The Vendor:
(a) represents that the Assets are all the assets reasonably necessary for
the conduct of the Business in the ordinary course (exclusive of
working capital) in the same manner as that in which such business has
been conducted in the immediate past, including, without limitation,
all Proprietary Rights, Software Products and Intellectual Property
used in the ordinary conduct of the Business and all contract,
warranty, and other intangible rights relating to or arising out of
the Business;
(b) represents that, prior to Completion the Vendor holds all right, title
and interest in the Assets and that there are no other agreements,
understandings, or arrangements which, as or after Completion, would
materially adversely affect the Assets and the Business, or the
ability of the Vendor to sell, transfer, convey and assign the Assets
and the Business to the Purchaser or result in the assumption of any
Liabilities by the Purchaser other than the Assumed Liabilities.
2.4 Inconsistency
In the event of a conflict between a provision of this Agreement and any
provision of the Principal Agreement, the provisions of the Principal
Agreement will prevail unless they are illegal, unenforceable or relate to
the laws of foreign jurisdiction.
2.5 Purchase Price apportionment
(a) The Purchase Price is to be apportioned between the Assets as follows:
(i) Accounts Receivable US$200,000
(ii) Inventory US$ 75,000
(iii) Property, Plant and Equipment US$ 25,000
3 PURCHASE PRICE
3.1 Time and manner of payment
Payment of the Purchase Price by the Purchaser shall be made in immediately
available funds by wire transfer to such account or accounts of the Vendor
as are notified to the Purchaser in writing not less than 3 Business Days
prior to Completion.
4 Completion
Completion shall simultaneously take place at the offices of the Purchaser,
counsel to the Purchaser, the Vendor, counsel to the Vendor, or at such
other places as the parties to this Agreement may agree.
5 Agreement to acquire foreign operations
On or prior to the Completion Date, certain assets and liabilities of the
operations of the Warrantor currently conducted in the United States will
be sold. Completion of this Transaction, shall be dependent on the closing
of the US Transaction, such that this Transaction shall not close until the
US Transaction closes, notwithstanding any other provision of this
Agreement or of the purchase agreement for the US Transaction to the
contrary.
6 conditions to completion
6.1 Conditions to obligation of Purchaser
The obligation of the Purchaser to effect the Transaction shall be subject
to the fulfilment at or prior to Completion of the following conditions,
unless the Purchaser agrees to waive such fulfilment:
(a) this Agreement and the Transaction contemplated by it shall have
received those approvals, consents, authorisations, and waivers from
government and other regulatory agencies and other third parties
(including lenders, holders of debt, securities and lessors) as
necessary;
(b) there shall not be in effect a preliminary or permanent injunction or
other order by any federal or state court or other authority which
prohibits the completion of the Transaction;
(c) the Vendor shall have performed in all material respects each of its
agreements and obligations contained in this Agreement and required to
be performed on or prior to the Completion and shall have complied
with all material requirements, rules and regulations of all
regulatory authorities having jurisdiction relating to the
Transaction;
(d) no material adverse change shall have taken place in the business,
condition (financial or otherwise) operations, or prospects of the
Business or the Assets since the date of the Balance Sheet other than
those, if any, that result from the changes permitted by, and
transactions contemplated by, this Agreement;
(e) the representations and warranties for the Vendor set forth in this
Agreement shall be true in all material respects as of the date of
this Agreement or, except in such respects as, in the reasonable
judgment of the Purchaser, do not materially and adversely affect the
business condition (financial or otherwise), operations, or prospects
of the Business or the Assets, at the Completion Date as if made as of
such time;
(f) the Purchaser shall have received from the Vendor documents sufficient
to transfer title of the Assets to the Purchaser and the delivery of
all Software Products and Intellectual Property, in each case
reasonably satisfactory in form and substance to the Purchaser and its
counsel;
(g) all conditions to the completion of the US Transaction, as described
in clause 5 above, have been satisfied or waived, it being an express
requirement that the US Transaction described in clause 5 above
complete on the same day, adjusted for the appropriate time zone for
that jurisdiction;
(h) the employment agreements between the Purchaser and the persons
identified in Schedule D have been executed and delivered by the
parties;
(i) the Vendor will use commercially reasonable efforts to make available
to the Purchaser prior to Completion an updated unaudited balance
sheet and income statement with related notes and schedules as of the
end of the month immediately prior to the Completion Date. If those
updated financial statements are produced, they shall, for purposes of
the definition of "Unaudited Financial Statements", replace and
supersede the balance sheet as at 31 July 2000 and the income
statement for the period ended 30 September 2000, in their entirety,
for all purposes relevant to this Agreement; and
6.2 Conditions to obligation of the Vendor
The obligation of the Vendor to effect the Transaction shall be subject to
the fulfilment at or prior to Completion of the following conditions,
unless the Vendor waives such fulfilment:
(a) this Agreement and the Transaction contemplated hereby shall have
received those approvals, consents, authorisations and waivers from
governmental and other regulatory agencies and other third parties
(including lenders, holders of debt securities and lessors);
(b) there shall not be in effect a preliminary or permanent injunction or
other order by any federal or state authority which prohibits the
completion of the Transaction;
(c) the Purchaser shall have performed in all material respects each of
its agreements and obligations contained in this Agreement required to
be performed on or prior to Completion and shall have complied with
all material requirements, rules and regulations of all regulatory
authorities having jurisdiction relating to the Transaction;
(d) the representation and warranties of the Purchaser set forth in this
Agreement shall be true in all material respects as of the date of
this Agreement and, except in such respects as do not materially and
adversely affect the business of the Purchaser, taken as a whole, as
of the Completion Date as if made as of such time;
(e) the Vendor shall have received from the Purchaser evidence
satisfactory to the Vendor and its counsel that the Purchase Price has
been, or is in the process of being, delivered in the form of
immediately available funds via wire transfer or other means
acceptable to the Vendor;
(f) all other conditions to the closing of the US Transaction, as
described in clause 5 above, have been satisfied or waived, it being
an express requirement that the US Transaction as described in clause
5 above, close on the same day, adjusted for the appropriate time zone
for that jurisdiction.
7 employees
7.1 Offers of Employment
(a) The Purchaser must offer employment in writing to the Employees with
effect from the Completion Date.
(b) The terms of the employment offered must be at least as favourable as
the terms of the Employees current terms of employment with the
Vendor.
7.2 Vendor's Obligation to Transferring Employees
At the Completion Date the Vendor must terminate the Transferring Employees
in writing.
7.3 Purchasers Obligation to Transferring Employees
The Purchaser must assume liability for all compensation and employment
entitlements for the employees indicated in Schedule 4 accrued but unpaid
prior to the Completion Date including without limitation, and to the
extent applicable:
(a) payment in lieu of notice or redundancy payment that the Vendor may be
obliged to pay to the Employee on the termination of the Employee's
employment with the Vendor;
(b) commissions, bonuses, salary and accrued but untaken long service
leave entitlements, superannuation and all other award and statutory
entitlements for the Transferring Employees; and
(c) untaken annual leave entitlements for Transferred Employees.
7.4 Indemnity
The Purchaser fully and unconditionally indemnifies and will keep
indemnified the Vendor (its directors, officers, agents and employees) in
respect of any cost, claim, demand, loss, expense or damages directly or
indirectly incurred or which may be directly or indirectly incurred by the
Vendor (its directors, officers, agents and employees) in relation to:
(a) a breach by the Purchaser of its obligations under this clause 7 ; or
(b) the termination by the Vendor or any of its employees in accordance
with the terms of this Agreement.
8 Covenants of the purchaser
8.1 Affirmative Covenants
From the date hereof through the Completion Date, the Purchaser will use
commercially reasonable efforts to satisfy the conditions to Completion set
forth in this Agreement and otherwise to ensure the prompt and expedient
completion of the Transaction substantially as contemplated by this
Agreement, and will use commercially reasonable efforts to cause the
Transaction to be completed, provided in all instances that the
representations and Warranties of the Vendor in this Agreement are and
remain true and accurate in all material respects and that the covenants
and agreements of the Vendor in this Agreement are honoured and that the
conditions to the obligations of the Purchaser set forth in this Agreement
are not incapable of satisfaction.
8.2 Cooperation
The Purchaser shall reasonably cooperate with the Vendor and its counsel,
accountants and agents in every way in carrying out the Transactions
contemplated herein, and in delivering all documents and instruments deemed
reasonably necessary or useful by the Vendor.
8.3 Expenses
Whether or not the Transaction is completed, all costs and expenses
incurred by the Purchaser in connection with the preparation of this
Agreement and in preparation for the Transactions contemplated hereby shall
be paid by the Purchaser.
8.4 Publicity
Prior to the Completion any written news releases by the Purchaser
pertaining to this Agreement or the Transaction shall be submitted to the
Vendor for review and approval prior to release by the Purchaser, and shall
be released only in a form approved by the Vendor, provided, however that:
(a) such approval shall not be unreasonably withheld; and
(b) such review and approval shall not be required of releases by the
Purchaser if prior review and approval would prevent the timely and
accurate dissemination of such press release as required to comply, in
the judgment of counsel, with any applicable law, rule or policy.
8.5 Cooperation
(a) The Purchaser acknowledges that post-Completion, the Vendor will be
dissolved, its assets liquidated and its affairs wound up. The
Purchaser will reasonably cooperate with the Vendor and its respective
counsel, accountants, agents and representatives in every way in that
regard and in executing and delivering all documents and instruments
deemed reasonably necessary or useful by the Vendor in that regard.
(b) Without limiting the foregoing, the Purchaser shall use its best
efforts to cause those employees of the Vendor who currently are
officers of the Vendor and who become employed by the Purchaser to
remain as officers of the Vendor, without compensation, and shall use
its best efforts to cause such employees to execute and deliver, on
behalf of the Vendor, the documents and instruments contemplated in
the immediately preceding sentence and to otherwise further the
dissolution, liquidation and winding up of the Vendor, as directed by
the Vendor, provided, however, that the Purchaser shall not be
required to take any action which may expose the Purchaser or any of
its officers, directors, employees or agents to any liability in
connection with such action.
(c) The Vendor shall reimburse the Purchaser for any and all reasonable
out-of-pocket expenses which it incurs and pays in connection with its
duties and obligations under this clause 8.5 but the Vendor shall not
be required to reimburse the Purchaser for the time spent by its
employees in furtherance of such duties and obligations.
(d) The Purchaser shall use its best efforts to retain, and on request,
shall provide the Vendor with access to or copies of, all documents
which the Vendor may reasonably request in connection with the
dissolution, liquidation and winding up of the Vendor or in preparing
and filing any and all tax returns and financial statements for any
periods ending on or prior to 31 December 2000, or in connection with
any audit activities in respect of any periods ending on or prior to
31 December 2000.
9 covenants of the vendor
9.1 Affirmative covenants
From the date hereof through the Completion Date, the Vendor will take
every action reasonably required of it to satisfy the conditions to
Completion set forth in this Agreement and otherwise to ensure the prompt
and expedient completion of the Transaction substantially as contemplated
hereby, and will exert all reasonable efforts to cause the Transaction to
be completed, provided in all instances that the representations and
warranties of the Purchaser in this Agreement are and remain true and
accurate and that the covenants and agreements of the Purchaser in this
Agreement are honoured and that the conditions to the obligations of the
Vendor set forth in this Agreement are not incapable of satisfaction.
9.2 Covenant not to compete
The Vendor will execute a five (5) year non-competition agreement with the
Purchaser to preclude the Vendor from engaging in any business competitive
with that of the Business, directly or indirectly, alone or in
collaboration with others, except with the written consent of the Purchaser
or as a shareholder of less than one percent (1%) of the common stock of a
publicly held company engaged in one or more of such businesses and with
such other terms as are mutually acceptable to the Vendor and Purchaser.
9.3 Access and information
Subject to the terms and conditions of the existing confidentiality
agreement between the Vendor and the Purchaser (the terms and conditions of
which are incorporated herein by reference), between the date of this
Agreement and the Completion Date the Vendor shall afford to the Purchaser
and to the Purchaser's accountants, counsel, and other representatives
reasonable access during normal business hours throughout the period prior
to Completion to all of its properties, books, contracts, commitments,
records (including, but not limited to, tax returns), and personnel
relating to the Assets or the Business and, during such period, shall
furnish promptly to the Purchaser:
(a) all written communications to its directors or to its shareholders
generally relating to the Assets or the Business;
(b) internal monthly financial statements of the Business when and as
available; and
(c) all other information relating to the Assets or the Business as the
Purchaser may reasonably request, but no investigation pursuant to
this clause 9.3 shall affect any representations or Warranties of the
Vendor, or the conditions to the obligations of the Purchaser to
complete the Transaction contained in this Agreement. The Purchaser
and its representatives shall use their best efforts to assert their
rights hereunder in such a manner as to minimise interference with the
business of the Vendor.
9.4 No solicitation
Until the Completion Date or the termination of this Agreement in
accordance with its terms, the Vendor, and those acting on behalf of it
will not, and the Vendor will use its best efforts to cause its officers,
employees, agents and representatives (including any investment banker) to
not, directly or indirectly, solicit, encourage, or initiate any
discussions with, or negotiate or otherwise deal with, or provide any
information to, any person or Entity other than the Purchaser and its
officers, employees and agents in relation to the Assets or the Business.
The Vendor will notify the Purchaser immediately upon receipt of an
inquiry, offer or proposal relating to any of the foregoing. None of the
foregoing shall prohibit providing information to others in a manner in
keeping with the ordinary conduct of the Vendor's business, or providing
information to government authorities.
9.5 Conduct of Business pending the Transactions
The Vendor covenants and agrees with the Purchaser that, prior to the
completion of the Transaction or the termination of this Agreement pursuant
to its terms, unless the Purchaser shall otherwise consent in writing,
which consent shall not be unreasonably withheld or delayed, and except as
otherwise contemplated by this Agreement or disclosed in the Disclosure
Document, the Vendor will comply with each of the following:
(a) the Business, and the other businesses that relate to, use or affect
the Assets, if any, will be conducted only in the ordinary and usual
course, the Vendor shall use reasonable efforts to keep intact the
business organisation and good will of the Business, keep available
the services of its employees whose principal activities relate to the
Business and maintain relationships, in a manner reasonably consistent
with historical practices, with suppliers, lenders, creditors,
distributors, employees, customers and others having business or
financial relationships with the Business, and it shall immediately
notify the Purchaser of any event or occurrence or emergency material
to and not in the ordinary and usual course of business of, the
Business or affecting any material part of the Assets;
(b) it shall not create, incur or assume any long-term or short-term
indebtedness for money borrowed or make any capital expenditures or
commitment for capital expenditures, affecting the Business or any of
the Assets, except in the ordinary course of business and consistent
with past practice;
(c) it shall not:
(i) adopt, enter into, or amend a bonus, profit sharing,
compensation, stock option, warrant, pension, retirement,
deferred compensation, employment, severance, termination, or
other employee benefit plan, agreement trust fund or arrangement
for the benefit or welfare of any employees of the Business; or
(ii) agree to any material (in relation to historical compensation)
increase in the compensation payable or to become payable to, or
any increase in the contractual term of employment of, any such
employee except, with respect to employees who are not officers
or directors, in the ordinary course of business and consistent
with past practice.
(d) it shall not sell, lease, mortgage, encumber, or otherwise dispose of
or grant any interest in any of the Assets except for sales,
encumbrances and other dispositions or grants in the ordinary course
of business of the Business and consistent with past practice and
except for liens for taxes not yet due or liens or encumbrances that
are not material in amount or affect and do not impair the use of the
property, or as specifically provided for or permitted in this
Agreement;
(e) it shall not enter into, or terminate, any material contact,
agreement, commitment, or understanding relating to or affecting the
Assets or the Business;
(f) it shall not enter into any agreement, commitment, or understanding,
whether in writing or otherwise, with respect to any of the matters
referred to in clauses 9.5(a) through (e) above;
(g) the Vendor will continue to properly and promptly file when due (or
obtain proper extensions with respect to) all federal, state, local,
foreign, and other tax returns, reports, and declarations required to
be filed by it relating to the Assets or the Business, and will pay
when due, all taxes and governmental charges due (including any
amounts deferred as a result of an extension or otherwise) from or
payable by it relating to the Assets or the Business;
(h) the Vendor will comply in all material respects with all laws and
regulations applicable to the operations of the Business and the
utilisation of the Assets;
(i) the Vendor will maintain in full force and effect insurance coverage
relating to the Assets or the Business of a type and amount consistent
with past practice, but not less than that presently in effect.
9.6 Cooperation
The Vendor will reasonably cooperate with the Purchaser and its counsel,
accountants and agents in every way in carrying out the transactions
contemplated by this Agreement and in delivering all documents and
instruments deemed reasonably necessary or useful by the Purchaser.
9.7 Expenses
Whether or not the Transaction is completed, all costs and expenses
incurred by the Vendor in connection with the preparation of this Agreement
and in preparation for the Transaction and in connection with the
Completion of the Transaction contemplated hereby shall be paid by the
Vendor.
9.8 Publicity
Prior to the Completion any written news releases by the Vendor pertaining
to this Agreement or the Transaction shall be submitted to the Purchaser
for review and approval prior to release by the Vendor, and shall be
released only in a form approved by the Purchaser, provided, however, that:
(a) approval shall not be unreasonably withheld; and
(b) such review and approval shall not be required of releases by the
Vendor if prior review and approval would prevent the timely and
accurate dissemination of such press release as required to comply, in
the judgment of counsel, with any applicable law, rule or policy.
9.9 Updating the Schedules and Disclosure Documents
The Vendor shall notify the Purchaser of any changes, additions or events
which may cause any change in or addition to the Disclosure Document or any
Schedules delivered by it under this Agreement promptly after the
occurrence of the same and again at the Completion by delivery of
appropriate updates to the Disclosure Document and to all such Schedules.
No such notification made pursuant to this clause shall be deemed to cure
any breach of any representation or Warranty made in this Agreement unless
the Purchaser specifically agrees hereto in writing nor shall any such
notification be considered to constitute or give rise to a waiver by the
Purchaser of any condition set forth in this Agreement.
9.10 Payment of Unassumed Liabilities
The Vendor and the Warrantor agree to promptly pay when due, or otherwise
to discharge, without cost or expense to the Purchaser, each and every
Liability of it relating to the Business other than the Assumed
Liabilities.
10 INDEMNITY BY Vendor
The Vendor agrees to jointly and severally indemnify, defend and hold
harmless, the Purchaser and its officers, directors, shareholders,
managers, members, employees, independent contractors, agents, successors
and assigns (the "Purchaser Parties"), for, from and against any and all
liabilities, losses, costs or expenses which any of the Purchaser Parties
may suffer or for which any of the Purchaser Parties may become liable and
which are based on, the result of, arise out of or are otherwise related to
any of the following:
(a) any inaccuracy or misrepresentation in, or breach of any
representation or Warranty of the Vendor contained in this Agreement,
any of the documents or agreements executed in connection with this
Agreement (the "Attendant Documents") or any certificate, schedule,
list or other instrument to be furnished by the Vendor to the
Purchaser pursuant to this Agreement or any of the Attendant
Documents;
(b) any breach of failure of the Vendor to perform any covenant or
agreement required to be performed by the Vendor pursuant to this
Agreement or any of the Attendant Documents including, without
limitation, the Vendor's obligations to pay the unassumed Liabilities
under clause 9.10 above;
(c) any and all actions, suits, proceedings, demands, assessments,
judgments, costs and expenses, including reasonable attorneys' fees
and consultants' fees (the "Related Expenses").
11 Indemnity by Purchaser and purchaser's guarantor
The Purchaser and the Purchaser's Guarantor hereby agree to indemnify,
defend and hold harmless, the Vendor from and against any and all
liabilities, losses, costs or expenses which the Vendor may suffer or for
which the Vendor may become liable and which are based on, or the result
of, or arising out of or are otherwise related to any of the following:
(a) any inaccuracy or misrepresentation in, or breach of any
representation of the Purchaser contained in this Agreement, any of
the Attendant Documents or any certificate, schedule, list or other
instrument to be furnished by the Purchaser to the Vendor pursuant to
this Agreement or any of the Attendant Documents; and
(b) any breach or failure of the Purchaser to perform any covenant or
agreement required to be performed by the Purchaser pursuant to this
Agreement or any of the Attendant Documents including, without
limitation, Purchaser's obligations to pay the Assumed Liabilities
under clause 2.2 above.
12 Remedies
The Purchaser and the Vendor shall be entitled to exercise and resort to
all rights and remedies for misrepresentation or breach as are afforded at
law or in equity, including without limitation, rescission, specific
performance or such other non-monetary remedies and relief as may be
afforded under this Agreement or by a court of competent jurisdiction.
Neither the existence or exercise of any specific remedies is intended to
be exclusive or impair or otherwise adversely affect in any manner
whatsoever any rights, remedies or relief otherwise available, and each and
every right and remedy will be cumulative and in addition to every other
right and remedy provided in this Agreement or by law. Notwithstanding the
foregoing, other than actions for fraud or other intentional torts, the
remedies set forth in this clause 12 shall be the Purchaser and the
Vendor's sole and exclusive remedies relative to the recovery of economic
or monetary damages.
12.1 Procedures
If any proceedings are instituted or any claim or demand is asserted by any
person not a party to this Agreement in respect of which the Purchaser or
the Vendor may seek indemnification pursuant to clause 10, or clause 11,
the indemnified party shall promptly cause written notice (the "Notice") of
the assertion of any such claim or demand to be made to the indemnifying
party; provided, however, that the failure of the indemnified party to give
prompt Notice shall not relieve the indemnifying part of its obligations
pursuant to clause 10 and clause 11, and only to the extent that, such
failure caused the damages for which the indemnifying party is obligated to
be greater than they would have been had the indemnified party given the
indemnifying party prompt Notice in accordance with clause 20.3.
12.2 Negotiation
Except as otherwise provided:
(a) the indemnifying party shall have the right, at its option and
expense, to defend against, negotiate, or settle any such claim or
demand, and if the indemnifying party exercises that option, the
indemnifying party shall not be liable for the fees and expenses
incurred after the date the indemnifying party notifies the
indemnified party of such exercise by a counsel employed by the
indemnified party;
(b) an indemnifying party may not settle any such claim or demand without
the written consent (which consent shall not be unreasonably withheld,
conditioned or delayed) of the indemnified party unless such
settlement requires no more than a monetary payment for which the
indemnified party is fully indemnified or involves other matters not
binding upon the indemnified party; and
(c) an indemnifying party shall not be liable for any settlement of any
such claim or demand effected without its prior written consent (which
consent shall not be unreasonably withheld, conditioned or delayed).
12.3 Failure to Respond
In the event that the indemnifying party shall fail to respond within ten
(10) days after the giving of the Notice, then the indemnified party may
retain counsel and conduct the defence thereof as it may, in its sole
discretion, deem proper, at the sole cost and expense of the indemnifying
party. The parties agree to cooperate fully with each other in connection
with the defence, negotiation or settlement of any such legal proceedings,
claim or demand.
12.4 Co-operation
(a) The Purchaser shall, and shall cause its accountants, counsel,
employees and other representatives to reasonably cooperate with the
Vendor in connection with any and all disputes which may arise in
connection with any and all liabilities other than the Assumed
Liabilities (the "Excluded Liabilities").
(b) The Vendor shall, and shall cause its accountants, counsel, employees
and other representatives to, reasonably cooperate with the Purchaser
in connection with any and all disputes which may arise in connection
with any and all of the Assumed Liabilities.
(c) The Purchaser shall cause its accountants, counsel, employees and
other representatives, to make available to the Vendor, documents and
other information and materials reasonably requested by the Vendor in
connection with the Excluded Liabilities and the Vendor shall cause
its respective accountants, counsel, employees and other
representatives, to make available to the Purchaser, documents and
other information and materials reasonably requested by the Purchaser
in connection with the Assumed Liabilities.
The party requesting cooperation (the Vendor in connection with the
Excluded Liabilities or the Purchaser in connection with the Assumed
Liabilities) shall pay all out-of-pocket expenses reasonably incurred and
paid by the cooperating party to third parties in connection with such
cooperative efforts; provided, however, that the party requesting
cooperation shall not be obligated to reimburse the cooperating party for
the time spent by any of their employees' time spent in connection with
such cooperative efforts.
12.5 Initial Limitation
Other than the rights to defend and hold harmless with respect to third
party claims neither party shall have any liability for indemnification
pursuant to clause 10 and clause 11 above, until the aggregate amount of
all losses suffered by the party seeking indemnification with respect to
such matters exceeds the sum of $100,000.00 provided however, that this
limitation shall not apply to breaches by the Vendor of its obligations
under clause 10 or the Purchaser of its obligations to pay the Assumed
Liabilities.
12.6 Aggregate Limitation
The aggregate liability, for either Party, for indemnification pursuant to
clause 10 and clause 11, shall not exceed the sum of $100,000.00 provided
however, that this limitation shall not apply to breaches by the Vendor of
its obligations under clause 9.10 above or the Purchaser of its obligations
to pay the Assumed Liabilities under clause 2.2.
12.7 Available Insurance Limitation
The amount of any recovery for indemnification pursuant clause 10 or clause
11 above, shall be determined after taking into account all amounts to
which the indemnified party is entitled and actually receives under the
provisions of all insurance policies with third parties subject to offset
for any increase in premiums attributable to such losses or payments made
in respect of such losses. The parties agree to use reasonable efforts to
collect amounts available under any such insurance policies.
12.8 Accounts Adjustment Limitation
(a) With respect to any claim of indemnification related to any breach of
clause 10 or any other representation or warranty concerning the
Accounts, the amount of any recovery by the Purchaser for
indemnification pursuant to clause 10 above, or any other
representation or warranty concerning the Accounts, shall be reduced
by any Balance Sheet Gains.
(d) The Purchaser shall deliver to the Vendor or the Warrantor a report
identifying Balance Sheet Gains or must represent in writing that
there are no Balance Sheet Gains.
12.9 Application of Indemnification Provisions
The parties agree:
(a) That the limitations of the indemnification provisions contained in
clauses 12.5, 12.6, 12.7 and 12.8 above do not apply to the parties'
rights and obligations to defend and hold harmless with regard to
third party claims, pursuant to clause 10 and clause 11 above, and
shall apply on a collective basis to all agreements for
indemnification including those to be entered into in respect of each
of the Related Transactions, pursuant to clause 5 above;
(b) For the avoidance of doubt, a claim for indemnification as a result of
a balance sheet adjustment, pursuant to clause 12.8 above, shall be
determined after taking into account any positive adjustments to the
Accounts or to accounts associated with any Related Transactions; and
(c) The parties further agree that the Purchaser's right to put any
Receivables back to the Vendor, as and to the extent provided in
clause 20.1 below, shall be determined on a collective basis, taking
into consideration all Receivables of the Vendor and all of the
foreign entities associated with the Related Transactions.
13 PURCHASER'S GUARANTOR
The Purchaser's Guarantor unconditionally and irrevocably guarantees to the
Vendor, performance of all of the Purchaser's obligations under this
Agreement, including without limitation those under clause 2.
14 TERMINATION
This Agreement and the Transaction may be terminated at any time prior to
the Completion, whether before or after any necessary shareholders
approval:
(a) by mutual consent of the Purchaser and the Vendor;
(b) by the Purchaser or the Vendor upon the material breach of this
Agreement by the other; or
(c) by either the Purchaser or the Vendor, upon written notice to the
other, if the conditions to such party's obligations to complete the
Transaction, in the case of the Purchaser, as provided in clause 6.2,
or, in the case the Vendor, as provided in clause 6.1, were not, or
cannot reasonably be, satisfied on or before 26 October 2000, unless
the failure of condition is the result of the material breach of this
Agreement by the party seeking to terminate this Agreement.
15 AMENDMENT
This Agreement may be amended by the Vendor and the Purchaser by
action taken at any time. This Agreement may not be amended except by
an instrument in writing signed on behalf of the Vendor and the
Purchaser.
16 WAIVER
At any time prior to the Completion Date, the Purchaser, or the Vendor, by
action taken by their respective boards of directors, may, but shall not be
obligated to:
(a) extend the time for the performance of any of the obligations or other
acts of the other parties hereto;
(b) waive any inaccuracies in the representations and warranties contained
herein or in any document delivered pursuant hereto; or
(c) waive compliance with any of the agreements or conditions contained
herein. Any agreement on the part of a party hereto to any such
extension or waiver shall be valid only if set forth in an instrument
in writing signed on behalf of such party.
17 RELIEF
In the event of liability on the part of the Vendor to the Purchaser in
accordance with the provisions of this Agreement prior to Completion, the
parties recognise and acknowledge that monetary measures of damages will
not reasonably be calculable and that specific performance and injunctive
relief should therefore be available to the Purchaser.
18 WARRANTOR'S OBLIGATIONS
18.1 Guarantee
The Warrantor acknowledges that the Purchaser has entered into this
document at the request of the Warrantor in reliance, amongst other things,
upon the Warrantor executing this Agreement to assure the due and punctual
observance and performance by the Vendor of the provisions of this
Agreement. Accordingly, the Warrantor unconditionally and irrevocably
guarantees to the Purchaser the due and punctual observance and performance
by the Vendor of all the obligations of the Vendor contained in this
Agreement and the truth of the Warranties. Without limiting the foregoing
the Warrantor further covenants to the Purchaser that it will use its best
endeavours to ensure the Vendor's compliance with the terms of this
Agreement.
18.2 Indemnity
The Warrantor unconditionally and irrevocably indemnifies, and agrees to
keep indemnified, the Purchaser its servants and agents and if a
corporation its servants or officers against all Loss relating directly or
indirectly to:
(a) any failure by the Vendor to pay any moneys in relation to, or to
comply with any of its obligations contained in or implied by, this
Agreement; and
(b) this Agreement or any related security, transaction or agreement being
or becoming void, voidable or otherwise unenforceable in accordance
with its terms or the priority or effectiveness of any of them being
adversely affected.
18.3 Guarantee not to be affected
Subject to clause 12, the liability of the Warrantor under this clause is a
principal unconditional and absolute obligation and is not abrogated,
prejudiced or adversely affected by the granting of time, credit or any
other forbearance, indulgence or concession to the Warrantor or to the
Vendor or by any other dealing, matter or thing which, but for this
provision, could or might operate to abrogate, prejudice or adversely
affect the Guarantee and Indemnity including, (without limitation), the
actual or alleged invalidity or unenforceability of any of the other
provisions of this Agreement.
18.4 Continuing guarantee
The Guarantee and Indemnity is a continuing guarantee and indemnity and is
irrevocable and remains in full force and effect notwithstanding
termination of this Agreement until all obligations of the Vendor under
this Agreement have been discharged and performed in full. If any payments
made by the Vendor are set aside or avoided by any statutory provision or
otherwise such payment are taken not to have been made and do not diminish
or reduce the liability of the Warrantor under the Guarantee and Indemnity.
18.5 No competition
Until the Vendor has fully discharged and performed all its obligations
under this Agreement, the Warrantor may not without the written consent of
the Purchaser:
(a) by way of reduction of its liability under this clause, raise a
set-off or counter-claim available to itself, the Vendor or a
co-surety or co-indemnifier against the Vendor or claim a set-off or
make a counter-claim against the Vendor;
(b) prove in competition with the Purchaser against the Vendor.
18.6 Guarantee in addition to other rights of the Purchaser
The Guarantee and Indemnity is in addition to and not in substitution for
any other security or right which the Purchaser may now have or may
subsequently take or hold against the Vendor or the Warrantor and may be
enforced without first recourse to such other security or right and without
taking any steps or proceedings against the Vendor, notwithstanding any
rule of law or equity or statutory provision to the contrary.
18.7 Representations by the Warrantor
The Warrantor warrants to the Purchaser that:
(a) it has the corporate power to enter into and perform and has taken all
necessary corporate and other action to authorise the execution and
performance of the Guarantee and Indemnity;
(b) the Guarantee and Indemnity constitutes a legal and binding obligation
of the Warrantor;
(c) the execution and performance of the Guarantee and Indemnity does not
violate any provision of any existing law or of the memorandum and
articles of association of the Warrantor or of any mortgage, contract
or other undertaking to which the Warrantor is a party or which is
binding upon the Warrantor or its assets; and
(d) the Warrantor is not aware of any matter material to the conduct of
the Business which has not been adequately disclosed to the Purchaser
in this Agreement.
19 GST
19.1 Definitions
In this clause the expressions "adjustment note", "consideration", "GST",
"input tax credit", "recipient", "supply", "supply of a going concern",
"tax invoice" and "taxable supply" have the meanings given to those
expressions in the A New Tax System (Goods and Services Tax) Xxx 0000.
19.2 Sums exclude GST
Unless otherwise expressly stated, all prices or other sums payable or
consideration to be provided under this document are exclusive of GST.
19.3 Responsibility for GST
Despite any other provision in this document, if GST is imposed on any
supply made by the supplier under this document, the recipient shall pay to
the supplier an amount equal to the GST payable on the taxable supply. That
amount shall be paid at the same time that the consideration for the supply
is payable under this document and shall be paid in addition to the
consideration.
19.4 Supply of going concern
The parties agree that the sale of the Assets by the supplier under this
document is a supply of a going concern. If the sale of the Assets is not a
supply of a going concern and GST is payable by the supplier on the sale of
the Assets, the recipient will pay to the supplier the sum of an amount
equal to the GST payable plus any penalties and interest imposed on the
supplier for late payment of GST. That amount shall be paid in addition to
all amounts payable by the recipient under this document for the purchase
of the Assets and notwithstanding paragraph 1.3 shall be paid to the
supplier on demand.
19.5 Reimbursement of expenses
If this document requires the recipient to reimburse the supplier for any
expense, loss or outgoing ("reimbursable expense") incurred by the
supplier, the amount required to be reimbursed by the recipient will be the
sum of:
(a) the amount of the reimbursable expense net of input tax credits (if
any) to which the supplier is entitled in respect of the reimbursable
expense; and
(b) if the supplier's recovery from the recipient is a taxable supply, any
GST payable in respect of that supply.
19.6 Tax invoice
If a GST is imposed on any supply made by the supplier under this document
or the amount of GST is varied, the supplier will provide the recipient
with a tax invoice or adjustment note.
20 GENERAL PROVISIONS
20.1 Collection of Accounts Receivable
Upon and after the Completion Date:
(a) ThePurchaser shall have the right and authority to collect all
Receivables transferred to the Purchaser pursuant to this Agreement
and to endorse the name of the Vendor on any checks received on
account of any such Receivables;
(b) The Vendor shall promptly transfer and deliver to the Purchaser any
cash, checks or other property which the Vendor may have in respect of
its Accounts;
(c) Payments received from customers in respect of Receivables shall be
applied to the oldest outstanding Receivable from such customer,
unless such customer, acting on its own volition, specifically
identifies such payment to a particular Receivable;
(d) The Purchaser shall use commercially reasonable efforts to collect the
Receivables (but shall not be obliged to bring any action to collect
Receivables) but if it shall fail to collect the full amount of any
such Receivable within 180 days of the Completion Date, and subject to
clause 20.1(e) and (f) the Purchaser may require the Vendor to
purchase the Receivable at its face value;
(e) The Purchaser shall not require the Vendor to purchase any Receivable
where the Purchaser has compromised, settled or agreed to accept
payment at less than face value or as given a credit in respect of
that Receivable; and
(f) The Vendor shall not be obliged to repurchase any Receivables until
the aggregate amount of Receivables which the Purchaser has a right to
and has elected to put to the Vendor exceeds the reserve for such
Receivables in the Accounts. Any such put right must be exercised by
the Purchaser no later than one year after the Completion Date.
20.2 Arbitration
In the event that there shall be a dispute arising out of or relating to
this Agreement, the Transaction, any document referred to herein or
centrally related to the subject matter hereof, or the subject matter of
any of the same, the parties agree that such dispute shall be submitted to
binding arbitration in Sydney, Australia, under the auspices of, and
pursuant to the rules of, the Australian Commercial Disputes Centre Limited
as then in effect, or such other procedures as the parties may agree to at
the time, before an arbitrator selected pursuant to the rules of the
Australian Commercial Disputes Centre Limited. Any award issued as a result
of such arbitration shall be final and binding between the parties, and
shall be enforceable by a court having jurisdiction over the party against
whom enforcement is sought.
20.3 Notices
All notices and other communications required or permitted hereunder shall
be in writing and shall be deemed given if and when delivered personally or
3 Business Days following mailing by registered or certified mail (return
receipt requested) to the parties at the following addresses or at such
other address for a party as shall be specified by like notice given.
If to the Purchaser:
AremisSoft Australia Pty Ltd
Tel: 0000 0000
Fax: 0000 0000
Attention:
with a copy to: Xxxxxxxxxxx Xxxxxxx
AremisSoft Corporation
Tel: 000 000 0000
Fax:
Attention: Xxxx Xxxxx
If to the Vendor:
Eltrax Systems Pty Ltd
Tel: 0000 0000
Fax: 0000 0000
Attention: Xx Xxxxxxx
with a copy to:
Eltrax International Inc
Tel: 000-000-0000
Fax: 000-000-0000
Attention: Xxxxxxx X Xxxxxx
20.4 Interpretation
The headings contained in this Agreement are for reference purposes only
and shall not affect in any the meaning or interpretation of this
Agreement.
20.5 Survival of Representations and Warranties
The representations, Warranties, covenants, and agreements of the parties
contained herein shall survive and shall not merge on Completion and any
investigation of the other party made prior thereto. Representations and
Warranties shall so survive for a period of 3 years from Completion, except
for those contained in SC 1.1, 1.2, 1.3 2.1, 2.2 and 2.3 and clauses 2.2
and 2.4 which shall survive indefinitely, and for those contained in SC 2.5
which shall survive until 31 March 2001.
20.6 Miscellaneous
This Agreement and the existing confidentiality agreement constitute the
entire agreement and supersedes all of the prior agreements and
understandings, both written and oral, between the parties, with respect to
the subject matter hereof, except as specifically provided otherwise or
referred to herein, so that no such external or separate agreements
relating to the subject matter of this Agreement:
(a) shall have any effect or be binding, unless the same is referred to
specifically in this Agreement or is executed by the parties after the
date hereof;
(b) is not intended to confer upon any other person any rights or remedies
hereunder;
(c) shall not be assigned by operation of law or otherwise except for
assignments of all or any part of the rights of the Purchaser
hereunder, which may be freely assigned by the Purchaser so long as
the obligations of the Purchaser under this Agreement remain
obligations of, or their performance is unconditionally guaranteed
(which must be a guaranty of performance, and not just collection,
with no duty on the part of the Vendor to pursue the assignee first,
and which guarantee must be approved by the Vendor in advance, which
approval will not be unreasonably withheld) by, the Purchaser;
(d) shall be governed in all respects, including validity, interpretation
and effect, by the internal laws of the State of New South Wales,
without regard to the principles of conflict of laws thereof. It is
acknowledged and understood by the Vendor that the Purchaser may
assign it rights, but not its obligations, hereunder, after execution
and prior to Completion, to one or more wholly-owned (direct or
indirect) subsidiaries of the Purchaser;
(e) this Agreement may be executed in two or more counterparts which
together shall constitute a single agreement and facsimile signatures
shall have equal dignity with original signatures for all purposes;
and
(f) the execution and performance of this Agreement by the Purchaser and
the other transactions contemplated by this Agreement does not violate
or conflict with or result in a breach of or constitute a default
under the provisions of the memorandum and articles of association of
the Purchaser.
SCHEDULE 1
WARRANTIES
Index to Warranties
1 REPRESENTATIONS AND WARRANTIES OF PURCHASER
SC1.1 Organisation
SC1.2 Authority relative to this Agreement
SC1.3 Absence of breach: No consents
SC1.4 Brokers
2 REPRESENTATIONS AND WARRANTIES OF THE VENDOR
SC2.1 Organisation and Qualification
SC2.2 Authority Relatively to this Agreement
SC2.3 Absence of Breach: No Consents
SC2.4 Brokers
SC2.5 Financial Statements
SC2.6 Absence of Material Differences from the Disclosure Document
(i) No Undisclosed Liabilities
(ii) No Material Adverse Charge, etc
(iii) Taxes
(iv) Litigation
(v) Employees
(vi) Compliance with Laws
(vii) Ownership of Assets
(viii) Proprietary Rights, Software Products and Intellectual Property
(ix) Trade Names
(x) Facilities
(xi) Accounts Receivable
(xii) Inventories
(xiii) Contracts
(xiv) Accounts Payable
(xv) Employee Matters
(xvi) Title to and Utilisation of Real Properties and Leasehold
Estates
SC2.7 Full Disclosure
SC2.8 Action Since Balance Sheet Date
SCHEDULE 1
1 REPRESENTATIONS AND WARRANTIES OF PURCHASER
Purchaser hereby represents and warrants to the vendor:
SC1.1 Organisation
The Purchaser is a corporation duly organised, validly existing,
and in good standing under the Corporations Law of Australia and
has the requisite corporate power and authority to carry on its
business as it is now being conducted.
SC1.2 Authority relative to this Agreement
The Purchaser has the requisite corporate power and authority to
enter into this Agreement and to carry out its obligations
hereunder. The execution and delivery of this Agreement and the
completion of the transactions contemplated hereby have been duly
authorised and approved by the requisite level of corporate
authority of Purchaser and no other corporate proceedings on the
part of the Purchaser are necessary to approve and adopt this
Agreement or to approve the completion of the Transactions
contemplated hereby, including, without limitation, delivery of
the Purchase Price. This Agreement has been duly and validly
executed and delivered by the Purchaser and constitutes a valid
and binding obligation of the Purchaser, enforceable in
accordance with its terms.
SC1.3 Absence of breach: No consents
The execution, delivery and performance of this Agreement, and
the performance by Purchaser of its obligations hereunder and
compliance with any regulatory or licensing laws applicable to
the business of the Purchaser, all of which, to the extent
applicable to Purchaser, will be satisfied in all material
respects prior to Completion) do not, except as disclosed in
Schedule 2:
(i) conflict with, and will not result in a breach of, any of
the provisions of the Constitution of the Purchaser;
(ii) contravene any law, rule or regulation of any State or
Territory of or the Commonwealth of Australia;
(iii)contravene any applicable foreign jurisdiction or any
order, writ, judgment, jurisdiction, decree, determination,
or award affecting or binding upon the Purchaser, in such a
manner as to provide for a basis for enjoining or otherwise
preventing completion of the Transaction;
(iv) conflict with or result in a breach of or default under any
indenture or loan or credit agreement or any other agreement
or instrument to which Purchaser is a party, in such manner
as to provide a basis of enjoining or otherwise preventing
completion of the Transaction; or;
(v) require the authorisation, consent, approval or license of
any third party of such nature that he failure to obtain the
same would provide a basis for enjoining or otherwise
preventing completion of the Transaction.
SC1.4 Brokers
No broker, finding or investment banker is entitled to any
brokerage, finder's or other fee or commission in
connection with this Agreement or the Transaction or any
related transaction based upon any agreements, written or
oral, made by or on behalf of Purchaser or any of its
Subsidiaries.
2 REPRESENTATIONS AND WARRANTIES OF THE VENDOR
The Vendor represents and warrants to the Purchaser as follows:
SC2.1 Organisation and Qualification
The Vendor is a corporation duly organised, validly existing, and in
good standing under the Corporations Law of Australia and has the
requisite corporate power and authority to carry on the Business as it
is now being conducted.
SC2.2 Authority Relatively to this Agreement
This Agreement has been duly and validly executed and delivered by the
Vendor and constitutes a valid and binding Agreement of the Vendor
enforceable in accordance with its terms. The Vendor has all requisite
corporate power and authority to enter into this Agreement and to
carry out the Transaction contemplated hereby, and in doing so has
been duly and sufficiently authorised, subject only to governmental
regulatory approvals as and to the extent specifically set forth
elsewhere in this Agreement.
SC2.3 Absence of Breach: No Consents
The execution, delivery, and performance of this Agreement by the
Vendor and the performance by the Vendor of its obligations hereunder,
do not:
(i) except as identified in the Disclosure Document, conflict with or
result in a breach of any of the provisions of the Constitution
of the Vendor;
(ii) except as identified in the Disclosure Document, contravene any
law, ordinance, rule, or regulation of any State of Australia or
of any applicable foreign jurisdiction or contravene any order,
writ, judgment, injunction, decree, determination, or award of
any court or other authority having jurisdiction over, or cause
the suspension or revocation of any authorisation, consent,
approval or license, presently in effect, which affects or binds
the Vendor or all or any part of the Business or material
properties of the Business, except in any such case where such
contravention, suspension or revocation will not have a material
adverse effect on the business, condition (financial or
otherwise), operations or prospects of the Business and will not
have a material adverse effect on the validity of this Agreement
or on the validity of the completion of the Transaction;
(iii)except as identified in the Disclosure Document, conflict with or
result in a material breach of or default under any material
indenture or loan or credit agreement or any other agreement or
instrument to which the Vendor is a party or by which any of the
material properties of the Business may be affected or bound;
(iv) except as identified in the Disclosure Document, require the
authorisation, consent, approval, or license of any third party,
except for those the failure of which to obtain would not
reasonably be expected to have a material adverse effect on the
Business or the Assets; or
(v) except as identified in the Disclosure Document, constitute
grounds for the loss or suspension of any permits, licenses, or
other authorisations used in the Business.
SC2.4 Brokers
No broker, finder or investment banker is entitled to any brokerage,
finder's, or other fee or commission in connection with this Agreement
or the Transaction or any Related Transaction based upon any
agreements, written or oral, made by or on behalf of the Vendor. The
Vendor does not have any obligation to pay finder's or broker's fees
or commissions in connection with the exercise of options to renew or
extend real estate leases to which the Vendor is a party.
SC2.5 Financial Statements
The Vendor has delivered to the Purchaser the following:
(i) the Unaudited Financial Statements of the Business;
(ii) the Projections.
The Vendor confirms that:
(A) all of the historical financial statements contained in
such documents were prepared from the books and records
of the Vendor;
(B) the Unaudited Financial Statements were prepared in
accordance with Australian Accounting Standards;
(C) as at the Balance Sheet date, the Vendor owned each of
the Assets included in the Balance Sheet;
(D) the valuation of such Assets included in preparation of
the Balance Sheet is consistent with Australian
Accounting Standards;
(E) the Vendor had no Liabilities required to be included
in the Balance Sheet in accordance with Australian
Accounting Standards for which the Business or any part
of the Assets is responsible or liable, other than
those included in the Balance Sheet;
(F) there are no Liabilities required to be included in the
Balance Sheet in accordance in with Australian
Accounting Standards in amounts in excess of the
amounts included for them in the Balance Sheet, there
are no Liabilities required to be included in the
Balance Sheet in accordance with Australian Accounting
Standards in amounts in excess of the amounts included
for them in the Balance Sheet.
The Purchaser acknowledges that projections of future economic
performance are necessarily unreliable and subject to the occurrence
or non-occurrence of a variety of events, but the Vendor represents
that the Projections have been prepared on the basis of assumptions
that are, in the judgment of the Vendor, reasonable in all respects
and are not, to the knowledge of the Vendor, contrary in any material
respect to fact or to events that have occurred or are presently in
existence.
From the date hereof through to the Completion Date the Vendor will
continue to prepare financial statements for the Business on the same
basis that it has done so in the past, and will promptly deliver
updated financial statements to the Purchaser, and agree that from and
after such delivery the foregoing representations will be applicable
to each financial statement so prepared and delivered.
SC2.6 Absence of Material Differences from the Disclosure Document
(i) Except as specifically disclosed in the Disclosure Document in
sections corresponding to the subsections below:
(ii) No Undisclosed Liabilities
The Vendor has no Liabilities relating to or affecting the
Business or the Assets which are not, to the extent required by
Australian Accounting Standards, adequately reflected or reserved
against on the face of the Balance Sheet, except Liabilities
incurred since the date of the Balance Sheet in the ordinary
course of business of the Business and consistent with past
practice. Without limiting the foregoing:
(A) the Vendor is not in default or in breach, in any material
respect, under any contract, license, mortgage, indenture,
deed or permit held or affecting the Business;
(B) there are no leasehold improvements currently due and owing
in respect of the Acquired Assets for which the Business is
or will be responsible;
(C) there are no deferred rents due to lessors at or with
respect to any of such Acquired Assets; and
(D) the Disclosure Document sets forth, as part thereof, each
Liability of or affecting the Business or the Assets in an
amount in excess of $10,000 and each person to whom the
aggregate amount of such Liabilities is in excess of
$10,000.
(ii) No Material Adverse Charge, Etc
Since the date of the Balance Sheet, other than as contemplated
or caused by this Agreement, there has not been:
(A) any material adverse change in the business, condition
(financial or otherwise), operations, or prospects of the
Business;
(B) any damage, destruction or loss, whether covered by
insurance or not, having a material adverse effect on the
business, condition (financial or otherwise), operations or
prospects of the Business, or materially adversely affecting
the Assets;
(C) any entry into or termination of any material commitment,
contract, agreement or transaction affecting the Business or
the Assets (including, without limitation, any material
borrowing or capital expenditure or sale or other
disposition of any material asset or assets) other than this
Agreement and agreements executed in the ordinary course of
business;
(D) any transfer of or right granted under any material lease,
license, agreement, patent, trade xxxx, trade name or
copyright included among the Assets;
(E) any sale or other disposition of any assets of the Business,
or any mortgage, pledge or imposition of any licence or
other encumbrance on any asset of the Business or of any
corporation included in the Assets, or any agreement
relating to any of the foregoing, other than in the ordinary
course of business; or
(F) any default or breach in any material respect under any
contract, license or permit held by or for or affecting the
Business. Since the date of the Balance Sheet, the Vendor
has conducted the Business's only in the ordinary and usual
course, and without limiting the foregoing, no changes have
been made in:
(1) executive compensation levels; or
(2) the manner in which other employees of the Vendor are
compensated, or
(3) supplemental benefits provided to any such executives
or other employees of the Vendor; or
(4) inventory levels of the Business in relation to sales
levels, except, in any such case, in the ordinary
course of business and, in any event, without material
adverse effect on the business, condition (financial or
otherwise), operations, or prospects of the Business.
(iii) Taxes
The Vendor has properly filed or caused to be filed (or obtained
proper extensions in respect of) all federal, state, local, and
foreign income and other tax returns, reports, and declarations
that are required by applicable law to be filed by them and that
relate to or in any way affect the Business or the Assets except
for those the failure of which to file would not have an adverse
effect on the Business or the Assets, and have paid, or will pay
when due all federal, state, local, and foreign income and other
taxes properly due (including any amounts deferred as a result of
an extension or otherwise) for the periods covered by such
returns, reports and declarations.
(iv) Litigation
(A) No material investigation or review by any governmental
entity with respect to the Business or any of the Assets or
the use thereof is, to the best of the knowledge of the
Vendor, pending or threatened (other than inspections and
reviews customarily made of businesses such as the
Business), nor has any governmental entity indicated an
intention to conduct the same; and
(B) there is no action, suit or proceeding pending or, to the
best of the knowledge of the Vendor threatened against or
affecting the Business or the Assets at law or in equity, or
before any federal, state, municipal, or other governmental
department, commission, board, bureau, agency, or
instrumentality.
(v) Employees
(A) Compliance with Laws
The Business and each of the Assets is in substantial
compliance with all, and the Vendor has not received notice
of any violation of any laws or regulations applicable to it
or the operations of the Business, including, without
limitation, the laws and or regulations relevant to the use
or utilisation of premises, or with respect to which
compliance is a condition of engaging in any aspect of the
Business, except to the extent the failure of which any of
the foregoing to be true would not have a material adverse
effect on the Business or the Assets. The Business has all
permits, licenses, zoning rights, and other governmental
authorisations necessary to conduct its business as
presently conducted, except to the extent the failure of the
Business to have any of the foregoing would not have a
material adverse effect on the Business or the Assets. All
such permits, licenses, zoning rights, and other
governmental authorisations will, as a part and consequence
of the Transaction be transferred to the Purchaser at the
Completion Date.
(vi) Ownership of Assets
The Vendor:
(A) has (or as of the Completion Date will have) good,
marketable and insurable title, or valid, effective and
continuing leasehold rights (including licenses) in the case
of leased or licensed property, to all real property (as to
which, in the case of owned property, such title is fee
simple) and all personal property owned or leased by it and
comprising a part of the Assets or the Business, or used by
it in the conduct of the Business in such a manner as to
create the reasonable appearance or reasonable expectations
that the same is owned or leased by it; such ownership or
leasehold rights are, or at the Completion Date will be,
free and clear of all liens, claims, encumbrances and
charges (other than those customarily held by a lessor or
licensor in a lease or license of real property), except
liens for taxes not yet due and minor imperfections of title
and encumbrances, if any, which, singularly or in the
aggregate, are not substantial in amount and do not
materially detract from the value of the property subject
thereto or materially impair its use thereof;
(B) no other person has any ownership or similar right in, or
contractual or other right to acquire any such right in, any
of such assets; and such ownership or leasehold rights will
be conveyed to the Purchaser at the Completion Date pursuant
to the Transaction. The Vendor does not know of any
potential action by any party, governmental or other, and no
proceedings with respect thereto have been instituted of
which the Vendor's ability to use and to utilise each of
such assets in the business of the Business. The Vendor has
not received any default notices from any mortgagee
regarding any leased properties of the Business or any
leasehold interests which comprise any part of the Assets;
(C) the Balance Sheet contains a reasonably detailed listing, as
of the date specified therein, of all Assets including, but
not limited to:
(1) Accounts Receivable as provided for in clause 20.1;
(2) miscellaneous current assets in excess of $10,000;
(3) prepaid expenses in excess of $10,000;
(4) Software Products;
(5) real property; and
(6) gross aggregate additions for each of the past four
years by location of:
o buildings and improvements;
o leasehold improvements, and
o automobiles and trucks.
(vii) Proprietary Rights, Software Products and Intellectual Property
(A) The Vendor possesses full ownership of, or adequate and
enforceable exclusive long-term licenses or other exclusive
rights to use (without payment), all Proprietary Rights,
Software Products and Intellectual Property used in the
Business or utilised in connection with the Assets, and all
such ownership, license or other rights shall be conveyed to
the Purchaser at the Completion Date pursuant to the
Transaction;
(B) the Vendor has not received any notice of conflict which
asserts the rights of others with respect thereto; and the
Vendor has, in all material respects, performed all of the
obligations required to be performed by it, and is not in
default in any material respect, under any agreement
relating to any such Proprietary Rights, Software Products
and Intellectual Property.
(vii) Trade Names
The Disclosure Document identifies each trade name, fictitious
business name, or other similar name under which the Vendor has
conducted any part of the Business or in which the Vendor has
utilised any of the Assets during the five (5) years preceding
the date of this Agreement.
(ix) Facilities
(A) To the Vendor's knowledge (as applied to all of the
following), the Acquired Assets are (as to physical plant
and structure) structurally sound and none of the Acquired
Assets, nor any of the vehicles or other equipment used by
the Vendor in connection with the Business have any material
defects and all of them are in all material respects in good
operating conduction and repair and are adequate for the
uses to which they are being utilised.
(B) None of such Acquired Assets, vehicles or other equipment is
in need of maintenance or repairs except for ordinary,
routine maintenance and repairs (normal wear and tear
excepted) which are not material in nature or cost.
(C) The Vendor is not in any material breach, violation or
default of any lease affecting the Business or the Assets
with respect to, or as a result of which, the other party,
whether lessor, lessee, sublessor, or sublessee thereto, has
the right to terminate the same and the Vendor has not
received notice of any claim or assertion that it is or may
be in any such breach, violation or default.
(x) Accounts Receivable
All Accounts Receivable of the Vendor reflected in the Balance
Sheet represent transactions in the ordinary course of business
and are collectible, net of any reserves. As of the date
specified therein, the document specifically identifies:
(A) the aging of Receivables;
(B) each Receivable in excess of $10,000;
(C) each Receivable in an amount in excess of $5,000 that is
more than 90 days past due, and
(D) each Receivable from a person or Entity from whom the
aggregate of such Receivables exceeds $10,000.
(xi) Inventories
All Inventories of the Vendor reflected in the Balance Sheet are
of quality and quantity useable and saleable in the ordinary
course of business except for obsolete items and items of
below-standard quality, all of which, in the aggregate, are
immaterial in amount. Items included in the Vendor's Inventories
are carried on the books of the Vendor and are valued on the
Balance Sheet consistent with Australian Accounting Standards.
(vii) Contracts
The Assets and the Business are not affected by any contracts,
agreements or understandings, whether express or implied, written
or verbal, provided, however, that the Assets or the Business may
be affected by, and the Disclosure Document need not identify,
any such contracts, agreements, or understandings that fall into
one of the following categories:
(A) those that are terminable on notice of less than thirty-two
(32) days and do not involve payments or obligations of more
than $10,000 in any period of thirty-one (31) days or less
(on termination or otherwise); or
(B) those that involve aggregate payment or obligation remaining
unpaid as of the date of the Agreement of less than $10,000.
All items excluded in (B) above represent, in the aggregate,
less than $100,000.
The Vendor is not a party to any executory contract to sell
or transfer any part of any leasehold interest included in
the Assets or utilised by the Business. True and accurate
copies of all leases of properties included in the Assets or
utilised by the Business, including all amendments,
supplements, extensions and modifications thereof, have been
delivered to the Purchaser by the Vendor.
(viii) Accounts Payable
(vix)The accounts payable reflected on the Balance Sheet do, and
those reflected in the most recent Balance Sheet included in the
Unaudited Financial Statements do, and those reflected on the
books of the Vendor at the time of Completion will, reflect all
amounts owed by the Vendor in respect of trade accounts due and
other payables of the Business or relating to the Assets, and the
actual liability of the Vendor in respect of such obligations was
not, and will not be, on any of such dates, in excess of the
amounts so reflected on the Balance Sheet or the books of the
Business, as the case may be.
(xiv) Employee Matters
Subject to the Disclosure Document to the best of the knowledge
of the Vendor, there are no activities or controversies,
including without limitation, any labour organising activities,
election petitions or proceedings, proceedings preparatory
thereto, unfair labour practice complaints, labour strikes,
disputes, slowdowns, or work stoppages, pending or threatened,
affecting the employees of the Vendor.
(xv) Title to and Utilisation of Real Properties and Leasehold Estates
Except as disclosed in the Disclosure Document, the Vendor owns a
valid leasehold interest in all real property included in the
Assets and has the unbridled right to use the same (other than
those customarily held by a lessor or licensor in a lease or
license of real property), and is not aware of any claim, notice
or threat to the effect that its right to own and use such
property is subject in any way to any challenge, claim, assertion
of rights, proceedings toward condemnation or confiscation, in
whole or in part, or is otherwise subject to challenge. To the
Vendor's knowledge, each parcel of real property the ownership
of, or leasehold interest in, which is included among the Assets
is free of any and all hazardous wastes, substances or
contaminants in connection with any such property.
SC2.7 Full Disclosure
The documents, certificates, and other writings furnished or to be
furnished by or on behalf of the Vendor to the Purchaser pursuant to
the provisions of this Agreement, taken together in the aggregate, do
not and will not contain any untrue statements of a material fact, or
omit to state any material fact necessary to make the statements made,
in the light of the circumstances under which they are made, not
misleading.
SC2.8 Action Since Balance Sheet Date
Except as set forth on the Disclosure Document, since the date of the
Balance Sheet, the Vendor has not taken any actions that would be
prohibited under the provisions of this Agreement (without the prior
consent of the Purchaser) after the date of this Agreement.
SCHEDULE 3
accounts
SCHEDULE 4
employees
Name
EXECUTED by the parties as a deed
EXECUTED BY AremisSoft Australia Pty Limited in the)
presence of: )
)
)
Secretary/Director Director
Name of Secretary/Director (print) Name of Director (print)
EXECUTED BY AremiSsoft Corporation )
in the presence of: )
)
)
President Chief Executive Officer
Name of President(print) Name of Chief Executive
Officer (print)
EXECUTED BY Eltrax Systems Pty Ltd )
in the presence of: )
)
)
Secretary/Director Director
Name of Secretary/Director (print) Name of Director (print)
EXECUTED BY Eltrax International Inc )
in the presence of: )
)
)
President Chief Executive Officer
Name of President(print) Name of Chief Executive
Officer (print)
EXECUTED BY Verso Technologies Inc )
in the presence of: )
)
)
President Chief Executive Officer
Name of President(print) Name of Chief Executive
Officer (print)
