Exhibit 2.1
DATED April 9, 2001
X X XXXXXXXXX AND OTHERS (1)
and
I-MANY INC (2)
------------------------------------------------------
SHARE PURCHASE AGREEMENT
relating to the sale and purchase of the whole of the
issued share capital of BCL Vision Limited
------------------------------------------------------
CONTENTS
1 INTERPRETATION.........................................................................................3
2 SALE AND PURCHASE......................................................................................8
3 CONSIDERATION..........................................................................................8
4 COMPLETION.............................................................................................9
5 WARRANTIES............................................................................................12
6 REGISTRATION RIGHTS AND LOCK UP.......................................................................14
7 RESTRICTIVE COVENANTS.................................................................................17
8 CONFIDENTIALITY AND USE OF NAMES......................................................................19
9 OPTION POOL...........................................................................................19
10 FURTHER ASSURANCE.....................................................................................20
11 ANNOUNCEMENTS.........................................................................................20
12 COSTS.................................................................................................20
13 VARIATIONS............................................................................................20
14 TIME OF THE ESSENCE...................................................................................20
15 REMEDIES..............................................................................................20
16 ASSIGNMENT............................................................................................21
17 SEVERANCE.............................................................................................21
18 ENTIRE AGREEMENT......................................................................................21
19 INTEREST..............................................................................................21
20 COMPETITION...........................................................................................22
21 NOTICES...............................................................................................22
22 COUNTERPARTS..........................................................................................22
23 THIRD PARTY RIGHTS....................................................................................22
24 GOVERNING LAW.........................................................................................23
SCHEDULE 1
Part 1 - Sellers' holdings
Part 2 - Details of the Company
i
Part 3 - Subsidiaries of the Company
SCHEDULE 2
Part 1 - Warranties
Part 2 - Buyer Warranties
Part 3 - Provisions for the protection of Sellers
SCHEDULE 3
Part 1 - Brief description of the Property
Part 2 - Leases or Licences vested in the Company
Part 3 - Leases, Tenancies and Rights of Occupation of third parties
Part 4 - Present use of each of the Properties
SCHEDULE 4
Intellectual Property
Part 1 - Registered Intellectual Property Rights
Part 2 - Licences of Intellectual Property granted by the Group
Part 3 - Licences of Intellectual Property granted by third parties to the Group
SCHEDULE 5 Earn Out Consideration
SCHEDULE 6 Option Pool
ii
DATE OF AGREEMENT 2001
PARTIES
(1) X X XXXXXXXXX AND OTHERS whose names and addresses are set out in
column 1 of Part 1 of Schedule 1 (the "SELLERS")
(2) I-MANY INC a Delaware US corporation whose principal place of
business is at 5th floor, 000 Xxxxxxxx Xxxxxx, Xxxxxxxx, Xxxxx
00000, XXX (the "BUYER")
INTRODUCTION:
A The Sellers are the legal and beneficial owners of the whole of the
issued share capital of the Company (as defined below).
B The Sellers have agreed to sell the whole of the issued share capital
of the Company to the Buyer on the terms of this agreement.
IT IS AGREED THAT:
1 INTERPRETATION
1.1 In this agreement, unless the context otherwise requires, the following
words and expressions shall bear the following meanings.
"ASSOCIATE" means any person, firm or company which is a connected
person (as defined in section 839 ICTA) of any of the Sellers, or which
is an associated company of any of the Sellers within the meaning of
section 416 ICTA.
"BUSINESS DAY" means any day other than Saturdays, Sundays and Bank
Holidays during which clearing banks are open for business in the City
of London.
"BUYER COMMON STOCK" means shares of common stock, $0.001 par value per
share in the capital of the Buyer.
"BUYER REPORTS" means all reports and other documents required to be
filed by the Buyer since 11 July 2000 under the Exchange Act or the
Securities Act.
"BUYER'S GROUP" means the Buyer, any subsidiary of the Buyer, any
holding company of the Buyer and any subsidiary of any holding company
of the Buyer or any entity with or into which the Buyer is merged or
consolidated under US law, from time to time.
"BUYER'S SOLICITORS" means Xxxxxxx Suddards Edge of Trinity Court, 00
Xxxx Xxxxxx Xxxxxx, Xxxxxxxxxx X00 0XX.
"CA 1985" means the Companies Xxx 0000, as amended.
"COMPANY" means BCL Vision Limited, brief details of which are set out
in Part 2 of Schedule 1.
"COMPLETION" means completion of the sale and purchase of the Shares in
accordance with clause 4.
"CONDUCTING MEDIA" means sewer systems, drains, sewers, trenches,
pipes, conduits, sumps, flowlines and other Conducting Media.
3
"CONFIDENTIAL BUSINESS INFORMATION" means all or any information of a
confidential nature and not publicly known which is owned by a Group
Company or which is used in or otherwise relates to the business,
customers or financial or other affairs of any Group Company,
including, without limitation, information relating to:
(a) the business methods, corporate plans, management systems,
finances, new business opportunities or development projects of
any Group Company; or
(b) the marketing or sales of any past or present or future products,
goods or services of any Group Company including, without
limitation, customer names and lists and other details of
customers, sales targets, sales statistics, market share
statistics, prices, market research reports and surveys and
advertising and other promotional materials; or
(c) future projects, business development or planning, commercial
relationships and negotiations; or
(d) any trade secrets or other information relating to the provision
of any product or service of any Group Company.
"CONSIDERATION SHARES" means the 690,000 shares of Buyer Common Stock
to be issued and allotted to the Sellers subject to the terms of this
agreement and having an aggregate value at the Issue Price of
US$6,900,000.
"EARN OUT CONSIDERATION" means the aggregate value (at the Issue Price)
of the Earn Out Consideration Shares which is payable to the Sellers in
accordance with Schedule 5.
"EARN OUT CONSIDERATION SHARES" means such number of Buyer Common Stock
to be allotted and issued to the Seller at the Issue Price in
accordance with Schedule 5.
"DISCLOSURE LETTER" means the letter of even date herewith in the
agreed form from the Sellers to the Buyer disclosing information
constituting exceptions to the Warranties and details of other matters
referred to in this agreement.
"EC TREATY" means the Treaty of Rome 1957, as amended to become the
Treaty establishing the European Community.
"ENVIRONMENT" means:
(a) land, including without limitation, surface land, sub-surface
strata, sea bed and river bed under water (as defined in
paragraph (b)) and natural and man-made structures;
(b) water, including, without limitation, coastal and inland waters,
surface waters, aquatic sediment, ground waters, and water in
drains and sewers;
(c) air, including, without limitation, air inside buildings and
other natural and man-made structures above or below ground; and
(d) any living systems or organisms supported by the media set out in
(a), (b) or (c) above.
"ENVIRONMENTAL LAW" means all European Community, national, state,
federal, regional or local laws, common law, statutes, ordinances,
directives, regulations, notices,
4
standards having force of law, relevant clean-up standards, judgments,
decrees or orders, codes of practice, the requirements and conditions
of all Environmental Permits, both express and implied covenants,
agreements, circulars, guidance notes (statutory or otherwise),
judicial and administrative interpretations of each of the foregoing
concerning (without limitation) the protection of human health or the
Environment or the conditions of the work place and process safety, or
the generation, transportation, storage, treatment or disposal of any
Hazardous Substance, as enacted, amended, replaced or supplemented from
time to time.
"ENVIRONMENTAL PERMITS" means any permits, consents, licences,
certificates, notices, filings, lodgements, agreements, directions,
declarations, exemptions, variations, renewals and amendments and other
authorisations and approvals required or provided under Environmental
Law.
"ENVIRONMENTAL REGULATOR" means any governmental entity or other public
or quasi public authority or privatised utility having responsibility
for any matters concerning the Environment or Environmental Law.
"ESCROW AGREEMENT" means the agreement in agreed form between the
Sellers the escrow agent named therein and the Buyer relating to the
Escrow Shares.
"ESCROW SHARES" means 100,000 of the Consideration Shares having an
aggregate value at the Issue Price of $1,000,000 to be subject to the
Escrow Agreement.
"EXCHANGE ACT" means the Securities Exchange Act of 1934 (as amended).
"FA" means Finance Act.
"GROUP" means the Company and the Subsidiary.
"GROUP COMPANIES" means the Company and the Subsidiary "GROUP COMPANY"
means each of such companies and/or any one of them as the context
requires.
"HAZARDOUS SUBSTANCE" means any natural or artificial substance
(whether in solid or liquid form or in the form of a gas or vapour) or
organism (including genetically modified organisms) whether alone or in
combination with any other substance capable of causing harm to man or
any other living organism supported by the Environment or which
restricts or makes more costly the use, development, ownership or
occupation of the Properties or is capable of damaging the Environment
or human health or welfare including but not limited to asbestos or any
controlled, special, hazardous, toxic or dangerous chemical, substance
or waste.
"ICTA" means the Income and Corporation Taxes Xxx 0000.
"INTELLECTUAL PROPERTY" means any patents, trade marks, service marks,
registered designs, utility models, design rights, copyright (including
copyright in computer software), database rights, semi-conductor
topography rights, inventions, trade secrets and other confidential
information, know-how, business or trade names (including internet
domain names and e-mail address names) and all other intellectual and
industrial property and rights of a similar or corresponding nature in
any part of the world, whether registered or not or capable of
registration or not and including the right to apply for any
applications for any of the foregoing rights and the right to xxx for
infringements of any of the foregoing rights.
5
"INTELLECTUAL PROPERTY RIGHTS" means all the Intellectual Property
owned by any Group Company or used or entitled to be used by any Group
Company in or in connection with its business in the manner in which it
is carried on as at the date of this agreement, other than the
Registered Intellectual Property Rights.
"ISSUE PRICE" means $10 per share of Buyer Common Stock.
"LAST ACCOUNTS" means the audited balance sheet of each Group Company
as at the Last Accounts Date and the audited profit and loss account of
each Group Company made up to the Last Accounts Date and (in the case
of the Company) the audited consolidated balance sheet of the Company
Group as at such date and the audited consolidated profit and loss
account of the Company Group for such period and (in each case) the
auditor's and the directors' reports and notes thereon.
"LAST ACCOUNTS DATE" means 30 April 2000.
"LONDON STOCK EXCHANGE" means London Stock Exchange plc.
"MANAGEMENT ACCOUNTS" means the unaudited balance sheet and profit and
loss account of each Group Company together with the unaudited
consolidated balance sheet and profit and loss account and the
consolidated Company Group cash flow for the current financial year up
to the Management Accounts Date.
"MANAGEMENT ACCOUNTS DATE" means 28 February 2001
"NASDAQ" means the National Association of Dealers' Securities
Automated Quotations.
"OPTION POOL" means the 450,000 shares of Buyer Common Stock which are
the subject of clause 9 and Schedule 6.
"PLANNING ACTS" means the Town and Country Planning Xxx 0000, the
Planning (Listed Buildings and Conservation Areas) Xxx 0000, the
Planning (Consequential Provisions) Xxx 0000, the Planning (Hazardous
Substances) Xxx 0000 and the Planning (Compensation) Xxx 0000, and any
other statute or subordinate legislation relating to town and country
planning.
"PROPERTY" means the leasehold property known as ground floor and
basement 00 Xxxxxxxxxxx Xxxxxx, Xxxxxx XX00 0XX, which is occupied by
the Company, brief details of which are set out in Part 1 of Schedule
3.
"REGISTERED INTELLECTUAL PROPERTY RIGHTS" means all Intellectual
Property owned by any Group Company or used or entitled to be used by
any Group Company in or in connection with its business in the manner
in which it is carried on as at the date of this agreement and which is
the subject of registration (or application for registration) with any
competent authority in any jurisdiction.
"SEC" means the United States Securities and Exchange Commission.
"SECURITIES ACT" means the United States Securities Act of 1933 (as
amended).
"SECURITY INTEREST" means any mortgage, charge, assignment or
assignation by way of security, guarantee, indemnity, debenture,
hypothecation, pledge, declaration of trust,
6
lien, right of set off or combination of accounts, or any encumbrance
or security interest whatsoever, howsoever created or arising.
"SELLERS' ACCOUNTANTS" means Xxxxxxx Xxxxx Xxxxx, 000 Xxxxxxxx Xxxx,
Xxxxx Xxxxxxx XX0 0XX.
"SELLERS' SOLICITORS" means Xxxxxxx Xxxxxx Goldhill of 00/00 Xxxxx
Xxxxxxxx Xxxxxx, Xxxxxx X0 X0XX.
"SERVICE AGREEMENTS" means the service agreements in the agreed form to
be entered into with effect from Completion between the Company and
each of Messrs Xxxxxxxxx, Xxxxxxx and Xxxxxxx.
"SHARES" means the 50,400 ordinary shares of (pound)1 each in the
capital of the Company, fully paId or credited as fully paid, to be
sold by the Sellers in the numbers set out opposite their respective
names in Part 1 of Schedule 1.
"SUBSIDIARY" means the subsidiary of the Company, brief details of
which are set out in Part 3 of Schedule 1.
"TAXATION" has the meaning given to it in the Tax Deed and "TAX" shall
be construed accordingly.
"TAX DEED" means the deed of covenant relating to Taxation, which is in
the agreed form.
"TAXATION AUTHORITY" has the meaning given to it in the Tax Deed.
"TAXATION STATUTES" includes statutes (and all regulations and
arrangements whatsoever made thereunder) whether of the United Kingdom
or elsewhere, and whether enacted before or after the date of this
agreement, providing for or imposing any Taxation.
"TAX WARRANTIES" means the warranties in paragraph 8 of Schedule 2.
"TCGA" means the Taxation of Chargeable Gains Xxx 0000.
"UKLA" means the Financial Services Authority acting in its capacity as
the UK Listing Authority.
"VAT" means value added tax.
"VATA" means the Value Added Tax Xxx 0000.
"WARRANTIES" means the warranties and representations set out in Part I
of Schedule 2.
1.2 References to any statute, or to any statutory provision, statutory
instrument, order or regulation made thereunder, includes that statute,
provision, instrument, order or regulation as amended, modified,
consolidated, re-enacted, or replaced from time to time, whether before
or after the date of this agreement and also includes any previous
statute, statutory provision, instrument, order or regulation, amended,
modified, consolidated, re-enacted or replaced by such statute,
provision, instrument, order or regulation.
7
1.3 All references to a statutory provision shall be construed as including
references to all statutory instruments or orders, regulations or other
subordinate legislation made pursuant to that statutory provision.
1.4 Unless the context otherwise requires, all words and expressions which
are defined in the CA 1985 shall have the same meanings in this
agreement.
1.5 References to any English statutory provision or English legal term for
any action, remedy, method of judicial proceeding, document, legal
status, court, official or any other legal concept or thing shall, in
respect of any body corporate incorporated in any jurisdiction other
than England, be deemed to refer to and include any equivalent or
analogous action, remedy, method of judicial proceeding, document,
legal status, court, official or other legal concept or thing or what
most nearly approximates in that jurisdiction to the English statutory
provision or English legal term.
1.6 Unless the context otherwise requires, references to the singular
include the plural and vice versa, references to any gender include all
other genders, and references to "PERSONS" shall include individuals,
bodies corporate, unincorporated associations, professions, businesses
and partnerships.
1.7 Clause headings are for information only and shall not affect the
construction of this agreement.
1.8 The schedules to this agreement shall for all purposes form part of
this agreement.
1.9 References to documents in the "AGREED FORM" mean in the form agreed in
writing by or on behalf of each of the parties.
1.10 Each agreement, undertaking, covenant, warranty and representation made
or given in this agreement, the Tax Deed and any agreement or document
entered into pursuant to this agreement by the Sellers shall be deemed
for all purposes to be made or given jointly and severally by each of
the Sellers.
2 SALE AND PURCHASE
2.1 Subject to the terms and conditions of this agreement, each of the
Sellers shall sell with full title guarantee and the Buyer shall
purchase the number of Shares set opposite that Seller's name in column
(2) of Part 1 of Schedule 1 free from any and all Security Interests
together with all accrued benefits and rights attaching or accruing to
the Shares, including all dividends declared on or after the date of
this agreement.
2.2 The Sellers waive all rights of pre-emption (if any) over the Shares to
which they may be entitled under the Articles of Association of the
Company or otherwise in relation to the sale and purchase of the Shares
pursuant to this agreement.
3 CONSIDERATION
3.1 The consideration for the purchase of the Shares shall be a maximum sum
of $11,900,000, which shall be satisfied as follows:
(a) the sum of $6,900,000 which shall be satisfied as to $5,900,000
by the allotment and issue pursuant to clause 4.7(a)(iv) by the
Buyer to the Sellers of the numbers of Consideration Shares set
out in column 4 of Part 1 of Schedule 1 credited as
8
fully paid and as to $1,000,000 by the delivery into escrow of
the Escrow Shares pursuant to clause 3.4 and the Escrow
Agreement;
(b) the sum of $4,000,000 payable on Completion which shall be
satisfied by payment to the Sellers of the amounts set opposite
their respective names in column 3 of Part 1 of Schedule 1; and
(c) subject to the conditions set out in Schedule 5, by the payment
of the Earn Out Consideration (if any) in accordance with and as
determined by Schedule 5.
3.2 The Consideration Shares and the Earn Out Consideration Shares shall
rank pari passu in all respects with the existing Buyer Common Stock.
3.3 The Sellers agree that any sums due to all or any of the Sellers
pursuant to this agreement shall be paid by the Buyer to the Sellers'
Solicitors whose receipt shall constitute a full discharge of the
Buyer's obligations to make any such payment and the Buyer shall not be
concerned with the application of any such amount between all or any of
the Sellers.
3.4
(a) The Buyer shall deposit at Completion the Escrow Shares otherwise
issuable to the Sellers pursuant to Clause 3.1(a) above in escrow
subject to the terms of the Escrow Agreement as a partial source
of payment for the obligations of the Sellers in respect of their
liability for breach of Warranty under clause 5 (Warranties) of
this Agreement and/or the Tax Deed.
(b) The Escrow Shares shall be contributed by the Sellers in the
numbers specified in column 6 of Part I of Schedule 1 held and
disbursed pursuant to the terms of this Agreement and the Escrow
Agreement.
(c) Any liability of the Sellers pursuant to clause 5 (Warranties) or
the Tax Deed shall be paid out of the Escrow Shares (to the
extent they are held in escrow) pursuant to the terms and
conditions of the Escrow Agreement before recourse to any other
source, except for insurance that actually covers such claim.
4 COMPLETION
4.1 Completion shall take place at the offices of the Buyer's Solicitors
immediately following execution of this agreement when each of the
events set out in clauses 4.2 to 4.7 shall occur.
4.2 At Completion, the Sellers shall deliver to the Buyer:
(a) duly completed and executed transfers of the Shares in favour of
the Buyer or such other person as it directs;
(b) the certificates for the Shares;
(c) a power of attorney from each Seller in the agreed form enabling
the Buyer to vote the Shares pending its registration as
shareholder;
(d) duly completed and signed transfers in favour of the Buyer (or as
it may direct) of all shares in any member of the Company Group
(other than the Company) not
9
registered in the name of the Company and/or any other member of
the Company Group, together with the relative share certificates;
(e) the Tax Deed duly executed by the Sellers and the Company;
(f) evidence satisfactory to the Buyer that all charges, debentures
and other Security Interests affecting each Group Company
(including without limitation all such Security Interests held by
Lloyds TSB Bank plc) have not crystallised;
(g) any waiver, consent or other document necessary to give the Buyer
full legal and beneficial ownership of the Shares;
(h) a deed in agreed form duly executed by Xxxx Xxxxxxx waiving any
rights she may have over shares in the capital of the Company;
and
(i) a deed of assignment in agreed form between Messrs Xxxxxxxxx and
Xxxxxxx and the Company relating to the assignment of certain
intellectual property rights to the Company.
4.3 At Completion, there shall be delivered or made available to the Buyer:
(a) the certificate of incorporation (and, where relevant, any
certificate of incorporation on change of name) of each Group
Company;
(b) the minute books of each Group Company duly made up to
Completion;
(c) the register of members and other statutory registers of each
Group Company duly made up to Completion;
(d) any common seal of each Group Company;
(e) all unissued share certificates of each Group Company;
(f) the title deeds relating to the Property;
(g) all books of accounts and documents of record and all other
documents in the possession, custody or control of the Company in
connection with each Group Company all complete and up to date;
(h) bank statements in respect of each bank account of each Group
Company as at a date not more than 2 Business Days prior to
Completion together with bank reconciliation statements in
respect of each such account made up to Completion;
(i) new bank mandates to be given by each Group Company; and
(j) all the current cheque books, paying in books and unused cheques
of each Group Company.
4.4 At Completion, the Sellers shall and shall procure that their
respective Associates shall pay all monies (if any) then owing by them
to each Group Company, whether due for payment or not.
4.5 At Completion, the Sellers shall procure that each of the Service
Agreements and the Escrow Agreement is duly executed by each of them.
10
4.6 At Completion, a Board Meeting of each Group Company shall be duly
convened and held at which, with effect from Completion:
(a) the transfers referred to in clauses 4.2(a) shall (subject to
stamping) be approved and registered;
(b) such persons as the Buyer may nominate shall be appointed as
additional directors;
(c) all authorities to the bankers of each Group Company relating to
bank accounts shall be revoked and new authorities to such
persons as the Buyer may nominate shall be given to operate the
same;
(d) the Service Agreements shall be approved and entered into;
(e) the registered office of each Group Company shall be changed to
such address as the Buyer shall specify; and
(f) the accounting reference date of each Group Company shall be
changed to such date as the Buyer shall specify.
4.7 Upon completion of all of the matters specified in clauses 4.2 to 4.6:
(a) in satisfaction of its obligations under clause 3.1, the Buyer
shall:
(i) pay the sum of $4,000,000 by telegraphic transfer to the
Sellers' Solicitors plus the amount in pounds sterling of
the Sellers' Solicitors costs and disbursements (up to a
maximum of (pound)65,000 excluding VAT) relating to the
entry into and completion of this agreement and the
documents referred to in it provided such costs are the
subject of a valid invoice issued to the Sellers (payable
by the Buyer) accompanied by a detailed break down of the
time spent and the work undertaken;
(ii) deposit the Escrow Shares into escrow pursuant to the terms
of the Escrow Agreement;
(iii) issue and deliver the Escrow Agreement duly executed by the
Buyer;
(iv) issue to the American Stock Transfer Company, the Buyer's
transfer agent, instructions to issue the Buyer Common
Stock in the terms detailed in clause 3.1(a) above and
deliver to the Sellers faxed copies of the definitive share
certificates for such stock in the names of the Sellers in
accordance with the amounts specified in column (4) of Part
1 of Schedule 1;
(v) deliver to the Sellers the Tax Deed duly executed by the
Buyer; and
(vi) deliver to the Sellers a legal opinion in agreed form.
4.8 The Buyer may in its absolute discretion waive any requirement
contained in clauses 4.2 to 4.6 (inclusive) but shall not be obliged to
complete the purchase of any of the Shares unless the purchase of all
the Shares is completed in accordance with such clauses and this
agreement.
11
4.9 If any of the provisions of clauses 4.2 to 4.6 (inclusive) is not
complied with in all material respects by the Sellers on the date of
Completion, then the Buyer shall be entitled in its absolute
discretion:
(a) to rescind this agreement forthwith by notice in writing to the
Sellers; or
(b) to effect Completion so far as is practicable having regard to
the defaults which have occurred; or
(c) to specify a new date for Completion (being a Business Day not
more than 20 Business Days after the agreed date for Completion
pursuant to clause 4.1, in which event the provisions of this
clause 4 (except for this clause (c)) shall apply to Completion
as so deferred.
4.10
(a) Forthwith upon completion the Buyer shall enter the names of the
Sellers as the owners of record in the stock transfer record of
the Buyer in respect of the Consideration Shares (other than the
Escrow Shares) and the name of the Escrow Agent (as defined in
the Escrow Agreement) in respect of the Escrow Shares; and
(b) As soon as is reasonably practicable following Completion and in
any event within 10 Business Days thereof the Buyer shall deliver
original share certificates in respect of the shares referred to
in clause 4.10(a)to the respective Sellers.
5 WARRANTIES
5.1 Each of the Sellers jointly and severally warrants, represents and
covenants to the Buyer in the terms set out in Part 1 of Schedule 2,
subject only to any matter disclosed in the Disclosure Letter.
5.2 The Sellers acknowledge that the Buyer has entered into this agreement
in reliance upon the Warranties.
5.3 Each Warranty made or given in respect of the "COMPANY" shall be deemed
to be a Warranty of the Sellers made or given in respect of each member
of the Group and (unless the context or subject matter otherwise
requires) the expression the "COMPANY" in Schedule 2 shall be
construed accordingly.
5.4 Each of the Warranties shall be construed as a separate and independent
Warranty and, except where expressly stated, shall not be limited or
restricted by reference to or inference from the terms of any other
Warranty or any other provision of this agreement. The Warranties shall
not in any respect be extinguished or affected by Completion.
5.5 The rights and remedies of the Buyer in respect of any breach of the
Warranties shall not be affected by completion of the purchase of the
Shares, by any investigation made by or on behalf of the Buyer into the
affairs of the Group , by its rescinding or failure to rescind this
agreement, by any failure to exercise or delay in exercising any right
or remedy or by any other event or matter whatsoever, except a specific
and duly authorised written waiver or release expressly referring to
such breach.
12
5.6 Each of the Sellers agrees with the Buyer (for itself and as trustee
for each Group Company and their respective directors, officers and
employees) to waive any claim or remedy or right which they may have in
respect of any misrepresentation, inaccuracy or omission in or from any
information or advice supplied or given by any Group Company or a
director, officer or employee of any Group Company for the purpose of
assisting the Sellers in giving any warranty, representation,
undertaking or covenant, in preparing the Disclosure Letter and in
entering into this agreement, the Tax Deed or any agreement or document
entered into pursuant to this agreement.
5.7 Any of the Warranties which is qualified by the expression "SO FAR AS
THE SELLERS ARE AWARE" or "TO THE BEST OF THE KNOWLEDGE, INFORMATION
AND BELIEF OF THE SELLERS" or words to such effect, shall mean that
each of the Sellers has made due and careful enquiries into the subject
matter of any such Warranty (including, without limitation, enquiries
where applicable of the directors, officers, employees, agents and
advisers of each Group Company).
5.8 Without limiting the right of the Buyer to claim damages for breach of
any of the Warranties on any basis, if there is a breach of any of the
Warranties then the Sellers shall pay the Buyer on demand by way of
indemnity a sum equal to the amount necessary to put the Company into
the position which would have existed had there been no breach of such
Warranty. In particular, but without prejudice to the generality of
this clause, where the breach of such Warranty or the effect of such
breach is that
(a) the value of any asset of the Company (including any asset which
has been warranted to exist but which does not in fact exist) is
or becomes less than its value would have been had such breach
not occurred; or
(b) the Company is subject to or incurs a liability or an increase in
a liability to which it would not have been subject or which it
would not have incurred had there been no such breach; or
(c) the revenues of any Group Company are less than would be the case
if such breach had not occurred
then the Sellers shall pay the full amount of such deficiency or
diminution in the value of the asset or, as the case may be, of such
liability or increased liability or the amount of such revenue
shortfall.
5.9 Where any of the Warranties has been breached or shall be untrue or
misleading the Sellers undertake to indemnify the Buyer against all
costs (including legal costs on an indemnity basis as defined in Order
62 of the Rules of the Supreme Court), expenses or other liabilities
which the Buyer may reasonably incur either before or after the
commencement of any action in connection with:
(a) the settlement of any claim that any of the Warranties are untrue
or misleading or have been breached or;
(b) or the enforcement of any such settlement or judgment.
5.10 For the avoidance of doubt, amounts payable in respect of clause 5.11
will be calculated without reference to the rules of general law
relating to claims for damages for breach of warranties.
13
5.11 The Buyer warrants, represents and covenants to the Seller in the terms
set out in Part 2 of Schedule 2.
5.12 Part 3 of Schedule shall have effect in relation to the Warranties and
claims thereunder.
6 REGISTRATION RIGHTS AND LOCK UP
6.1 Prior to January 31, 2002, the Buyer shall file with the SEC, within 45
days following the request therefor by the holders of a majority of the
Consideration Shares issued to the Sellers as of the date of such
request, a registration statement (a "Stockholder Registration
Statement") on Form S-3 covering the resale to the public by the
Sellers of the first fifty percent (50%) of the Consideration Shares
(collectively, the "First Registrable Shares"). The Buyer shall use
commercially reasonable efforts to cause such Stockholder Registration
Statement to be declared effective by the SEC as soon as practicable,
PROVIDED that the request of the Sellers made pursuant to the preceding
sentence shall not be made earlier than 45 days prior to September 4,
2001 and such Stockholder Registration Statement shall not be declared
effective prior to September 4, 2001. The Buyer shall cause such
Stockholder Registration Statement to remain effective for one year or
such earlier time as all of the First Registrable Shares covered by
such Stockholder Registration Statement either have been sold pursuant
thereto or could be re-offered or otherwise disposed of under Rule 144
of the Securities Act. The Buyer shall not be required to effect more
than one registration pursuant to this clause 6.1.
6.2 Prior to May 1, 2002, the Buyer shall file with the SEC, within 45 days
following the request therefor by the holders of a majority of the
Consideration Shares and Earn Out Consideration Shares issued to the
Sellers as of the date of such request less all Consideration Shares
registered pursuant to clause 6.1, a Stockholder Registration Statement
on Form S-3 covering the resale to the public by the Sellers of the
last fifty percent (50%) of the Consideration Shares and the first
fifty percent (50%) of the Earn Out Consideration Shares (collectively,
the "Second Registrable Shares"). The Buyer shall use commercially
reasonable efforts to cause such Stockholder Registration Statement to
be declared effective by the SEC as soon as practicable, PROVIDED that
the request of the Sellers made pursuant to the preceding sentence
shall not be made earlier than 45 days prior to January 31, 2002 and
such Stockholder Registration Statement shall not be declared effective
prior to January 31, 2002. The Buyer shall cause such Stockholder
Registration Statement to remain effective for one year or such earlier
time as all of the Second Registrable Shares covered by such
Stockholder Registration Statement either have been sold pursuant
thereto or could be re-offered or otherwise disposed of under Rule 144
of the Securities Act. The Buyer shall not be required to effect more
than one registration pursuant to this clause 6.2.
6.3 Notwithstanding the above, the Buyer may, by written notice to the
Sellers, (i) delay the filing or effectiveness of a Stockholder
Registration Statement or (ii) suspend a Stockholder Registration
Statement after effectiveness and require that the Sellers immediately
cease sales of shares pursuant to such Stockholder Registration
Statement, in the event that (A) the Buyer files a registration
statement (other than a Stockholder Registration Statement, or a
registration statement on Form S-8 or its successor form) with the SEC
for a public offering of its securities or (B) the Buyer is engaged in
any activity or transaction or preparations or negotiations for any
activity or transaction that the Buyer desires to keep confidential for
business reasons, if the Buyer determines in good faith that the public
disclosure requirements imposed on the Buyer under the United States
Securities Act of 1933 (the "Securities Act") in connection with such
Stockholder
14
Registration Statement would require disclosure of such activity,
transaction, preparations or negotiations.
6.4 If the Buyer delays or suspends a Stockholder Registration Statement or
requires the Sellers to cease sales of shares pursuant to clause 6.3
above, the Buyer shall, as promptly as practicable following the
termination of the circumstance which entitled the Buyer to do so, take
such actions as may be necessary to file or reinstate the effectiveness
of such Stockholder Registration Statement and/or give written notice
to all the Sellers authorizing them to resume sales pursuant to such
Stockholder Registration Statement. If as a result thereof the
prospectus included in such Stockholder Registration Statement has been
amended to comply with the requirements of the Securities Act, the
Buyer shall enclose such revised prospectus with the notice to the
Sellers given pursuant to this Clause 6.4, and the Sellers shall make
no offers or sales of shares pursuant to such Stockholder Registration
Statement other than by means of such revised prospectus. The Buyer may
not postpone, suspend or delay its obligations under this clause 6 for
more than 90 days in aggregate in any 12-month period.
6.5 Each Stockholder Registration Statement in connection with clauses 6.1
or 6.2 shall be in accordance with the following registration
procedures:
(a) In connection with the filing by the Buyer of a Stockholder
Registration Statement the Buyer shall furnish to each Seller a
copy of the prospectus, including a preliminary prospectus, in
conformity with the requirements of the Securities Act.
(b) The Buyer shall use commercially reasonable efforts to register
or qualify the Consideration Shares and Earn Out Consideration
Shares covered by a Stockholder Registration Statement under the
securities laws of each state of the United States; provided,
however, that the Buyer shall not be required in connection with
this clause (b) to qualify as a foreign corporation or execute a
general consent to service of process in any jurisdiction.
(c) If the Buyer has delivered preliminary or final prospectuses to
the Sellers and after having done so the prospectus is amended or
supplemented to comply with the requirements of the Securities
Act, the Buyer shall promptly notify the Sellers and, if
requested by the Buyer, the Sellers shall immediately cease
making offers or sales of shares under a Stockholder Registration
Statement and return all prospectuses to the Buyer. The Buyer
shall promptly provide the Sellers with revised or supplemented
prospectuses and, following receipt of the revised or
supplemented prospectuses, the Sellers shall be free to resume
making offers and sales under such Stockholder Registration
Statement.
(d) The Buyer shall pay the expenses incurred by it in complying with
its obligations under this Agreement, including without
limitation all registration and filing fees, exchange listing
fees, fees and expenses of counsel for the Buyer, and fees and
expenses of accountants for the Buyer, but excluding (A) any
brokerage fees, selling commissions or underwriting discounts
incurred by the Sellers in connection with sales under a
Stockholder Registration Statement and (B) the fees and expenses
of any counsel retained by the Sellers.
6.6 Buyer shall not be required to include any Consideration Shares or Earn
Out Consideration Shares in a Stockholder Registration Statement,
unless:
(a) the Seller owning such shares furnishes to the Buyer in writing
such information regarding such Seller and the proposed sale of
such shares by such Seller as the
15
Buyer may reasonably request in writing in connection with such
Stockholder Registration Statement or as shall be required in
connection therewith by the SEC or any state securities law
authorities; and
(b) such Seller shall have provided to the Buyer its written
agreement satisfactory in form and substance to the Buyer:
(i) to indemnify the Buyer and each of its directors and
officers against, and hold the Buyer and each of its
directors and officers harmless from, any losses, claims,
damages, expenses or liabilities (including reasonable
attorneys fees) to which the Buyer or such directors and
officers may become subject by reason of any statement or
omission in such Stockholder Registration Statement made
solely in reliance upon, or in conformity with, a written
statement by such Seller furnished pursuant to this clause
6.6; and
(ii) to report to the Buyer sales made pursuant to such
Stockholder Registration Statement.
6.7 The Buyer agrees to indemnify and hold harmless each Seller whose
shares are included in a Stockholder Registration Statement against any
losses, claims, damages, expenses or liabilities (including reasonable
attorney fees) to which such Seller may become subject by reason of any
untrue statement of a material fact contained in such Stockholder
Registration Statement or any omission to state therein a fact required
to be stated therein or necessary to make the statements therein not
misleading, except insofar as such losses, claims, damages, expenses or
liabilities arise out of or are based upon information furnished to the
Buyer in writing by or on behalf of a Seller specifically for inclusion
in such Stockholder Registration Statement. The Buyer shall have the
right to assume the defence and settlement of any claim or suit for
which the Buyer may be responsible for indemnification under this
clause 6.7.
6.8 Sellers may not sell, pledge, dispose of or otherwise transfer any of
the Consideration Shares or Earn Out Consideration Shares (or any Buyer
Common Stock received on account thereof pursuant to any stock split,
stock dividend, recapitalization, combination of shares,
reclassification of shares, spin-off or other similar change in
capitalization or event, or any distribution to holders of Buyer Common
Stock other than a normal cash dividend) that have not been registered
pursuant to clause 6; provided however, the Sellers may engage in
hedging transactions with regard to such Buyer Common Stock if such
transactions are executed in compliance with the Securities Act.
6.9 Notwithstanding anything herein to the contrary, the rights of the
Sellers pursuant to clause 6 are subject and subordinate to the
registration rights of any other stockholders of the Buyer pursuant to
any agreement in effect on the date hereof, and (ii) shall not apply to
any of the Consideration Shares and Earn Out Consideration Shares that
could be reoffered or otherwise disposed of under Section 144 or the
Securities Act; provided however, if as a result of the foregoing the
holders of Consideration Shares or Earn Out Consideration Shares are
not permitted to register the number of Consideration Shares or Earn
Out Consideration Shares that such holders have requested to be
registered pursuant to either of clauses 6.1 and 6.2 above (the
"Excluded Shares"), then such holders collectively shall be entitled to
one additional demand registration right under clause 9.1 or 9.2, as
the case may be, or at the discretion of Buyer, to have the Excluded
Shares included in another registration being effected by the Buyer.
16
6.10 Each of the Sellers certifies that such Seller is not a natural person
resident of the United States, partnership or corporation organized in
the United States, or trust of which the trustee is a natural person
resident of the United States (each of the foregoing, a "U.S. Person"),
and certifies further that such Seller is not acquiring Buyer Common
Stock for the account or benefit of any U.S. Person or is a U.S. Person
who acquired Buyer Common Stock in a transaction that did not require
registration under the Securities Act;
6.11 Each of the Sellers agrees to resell such Buyer Common Stock only in
accordance with the provisions of Regulation S (including without
limitation restrictions under Regulation S on resale of such Buyer
Common Stock to U.S. person or for the account or benefit of a U.S.
person for a one-year period) promulgated under the Securities Act,
pursuant to registration under the Securities Act, or pursuant to an
available exemption from registration; and agrees not to engage in
hedging transactions with regard to such Buyer Common Stock unless in
compliance with the Securities Act.
6.12 Each of the Sellers acknowledges that certificates evidencing such
Buyer Common Stock acquired by such Seller shall contain a legend to
the effect that transfer is prohibited except in accordance with the
provisions of said Regulation S as follows:
THE SECURITIES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN REGISTERED
UNDER THE SECURITIES ACT OF 1933, AS AMENDED, OR APPLICABLE STATE
SECURITIES LAWS AND NONE OF SUCH SECURITIES, NOR ANY INTEREST THEREIN,
MAY BE SOLD, TRANSFERRED, ASSIGNED, MADE THE SUBJECT OF ANY SECURITY
INTEREST, OR OTHERWISE DISPOSED OF, UNLESS THE COMPANY SHALL FIRST HAVE
RECEIVED AN OPINION OF COUNSEL, IN FORM AND SUBSTANCE SATISFACTORY TO
THE COMPANY, TO THE EFFECT THAT SUCH SECURITIES OR INTEREST THEREIN,
AND THE PROPOSED DISPOSITION THEREOF, ARE THE SUBJECT OF A CURRENTLY
EFFECTIVE REGISTRATION STATEMENT UNDER SUCH ACT AND APPLICABLE STATE
SECURITIES LAW, OR THAT SUCH DISPOSITION IS EITHER (1) IN ACCORDANCE
WITH REGULATIONS UNDER SUCH ACT OR (2) PURSUANT TO AN AVAILABLE
EXEMPTION FROM REGISTRATION UNDER SUCH ACT AND LAW. FURTHERMORE,
HEDGING TRANSACTIONS INVOLVING THOSE SECURITIES MAY NOT BE CONDUCTED
UNLESS IN COMPLIANCE WITH THE ACT.
THE SECURITIES REPRESENTED BY THIS CERTIFICATE ARE SUBJECT TO THE
PROVISIONS OF A SHARE PURCHASE AGREEMENT DATED AS OF ____________ __,
2001, INCLUDING THEREIN CERTAIN RESTRICTIONS ON TRANSFER. A COMPLETE
AND CORRECT COPY OF THIS AGREEMENT IS AVAILABLE FOR INSPECTION AT THE
PRINCIPAL OFFICE OF THE COMPANY AND WILL BE FURNISHED UPON WRITTEN
REQUEST AND WITHOUT CHARGE.
6.13 The Buyer shall refuse to register any transfer of Buyer Common Stock
not made in accordance with the provisions of Regulation S promulgated
under the Securities Act, pursuant to registration under the Securities
Act, or pursuant to an available exemption from registration.
6.14 The preceding provisions of clause 6 relate to registration of
Consideration Shares and Earn Out Consideration Shares under the
federal securities laws of the United States of America. Any references
to various registration statement forms, and the interpretation of
clause 6 as a whole, shall take into account the context of such
securities laws and shall be construed so as to best comply with such
securities laws.
7 RESTRICTIVE COVENANTS
7.1 Each Seller covenants with the Buyer (for itself and as trustee for
each member of the Buyer's Group) that, without the prior written
consent of the Buyer, no Seller nor any of his Associates will for a
period of 3 years after the date of Completion:
17
(a) either as principal or partner, alone or jointly with, through or
as manager, adviser, consultant or agent for any person or in any
other capacity whatsoever, directly or indirectly, carry on or be
engaged, concerned or interested in the business of the design or
supply of accounts receivable, collection and/or dispute
management software in the United Kingdom or the United States of
America in competition with the business of any Group Company as
carried on at the date of Completion PROVIDED THAT:
(i) nothing contained in this clause 7.1 shall preclude any of
the Sellers from being the registered holder or beneficial
owner for investment purposes only of not more than 3% of
the equity share capital of any company listed on the
Official List of the London Stock Exchange or the
Alternative Investment Market or any other recognised
investment exchange; or
(ii) in relation to Mr J Xxxxxxx, the period during which the
restriction contained in this paragraph (a) shall apply
shall be 12 months after the date of Completion.
(b) solicit or entice away or seek to entice away any person who is,
and was at the date of Completion, or had for a period of 6
months immediately prior thereto been employed by any Group
Company in a management, sales, technology or marketing capacity;
or
(c) employ any person who is and was at the date of such, or had for
a period of 6 months immediately prior thereto been employed by
any Group Company in a management, sales, technology or marketing
capacity; or
(d) solicit or endeavour to solicit in competition with the business
of any Group Company (as carried on at the date of Completion)
the custom of, or orders from, any person, firm or company who
has been a customer of any Group Company at any time during the
period of 12 months immediately preceding the date of Completion;
or
(e) accept orders from any person, firm or company who has been a
customer of any Group Company at any time during the period of 12
months immediately preceding the date of Completion; or
(f) interfere with or seek to interfere with the continuance of
supplies to any Group Company (or the terms relating to such
supplies) from any suppliers who have been supplying components,
materials or services to any Group Company at any time during the
period of 12 months immediately preceding the date of Completion.
7.2 Each Seller covenants with the Buyer, for itself and as trustee for
each member of the Buyer's Group) that without the prior consent of the
Buyer, no Seller nor any of his Associates will, for a period of 6
months after termination of his employment with the Buyer's Group
solicit or entice away any person who is, and was at the date of
Completion, or had for a period of 6 months immediately prior thereto
been employed by any Group company in a management, sales, technology
or marketing capacity.
7.3 The restrictions contained in this clause 7 are considered to be
reasonable by the Sellers in all respects but if any of those
restrictions shall be held to be void in the circumstances where it
would be valid if some part were deleted, the parties agree that such
restrictions shall apply with such deletion as may be necessary to make
it valid and effective.
18
7.4 Each Seller shall procure that each member of the Sellers Group and
each of their respective Associates shall comply with the provisions of
this clause as if each such person were a party covenanting with the
Buyer.
7.5 Each Seller acknowledges that the Buyer is accepting the benefit of the
covenants contained in this clause both on its own behalf and on behalf
of each member of the Buyer's Group, the Company and the Subsidiary
with the intention that the Buyer may claim against the Seller in
question on behalf of any person for loss sustained by that person as a
result of any breach of any of the covenants contained in this clause.
7.6 The provisions of clauses 7.1(a) to 7.1(f) and 7.2 are separate and
severable and shall be enforceable accordingly.
8 CONFIDENTIALITY AND USE OF NAMES
8.1 Each Seller shall not at any time before and after the date of
Completion use or disclose or permit there to be disclosed any
Confidential Business Information which it has or acquires PROVIDED
THAT this clause shall not apply if and to the extent that:
(a) such Confidential Business Information has ceased to be
confidential or come into the public domain (other than as a
result of breach of any obligation of confidence by the Seller or
any of their respective Associates); or
(b) any disclosure of such Confidential Business Information has been
authorised in writing by the Buyer; or
(c) disclosure of the Confidential Business Information concerned is
required by law or by any regulatory body or the London Stock
Exchange or NASDAQ.
8.2 Each Seller shall not at any time after the date of Completion either
as principal or partner, alone or jointly with, through or as manager,
adviser, consultant or agent for any person or in any other capacity
whatsoever use any of the Registered Intellectual Property Rights and
the Intellectual Property Rights (in particular any name including the
words "Sales2Cash", "Corporate Arms", "Legal Arms", "Enforcement Arms"
or words similar to such name) or use in that connection anything which
is intended, or is likely to be confused with, any of the Registered
Intellectual Property Rights or the Intellectual Property Rights and,
if required so to do by the Buyer will transfer to the Buyer or its
nominee any such Intellectual Property Rights (including the
aforementioned names) in which such Seller or any of its Associates may
have any interest as soon as reasonably practicable after such request.
8.3 Each Seller shall procure that each of their respective Associates
shall comply with the provisions of this clause as if each such person
were a party covenanting with the Buyer.
9 OPTION POOL
The Buyer agrees to make available the Option Pool to be available for
issue to employees of the Company approved by the directors of the
Company in accordance with the rules of an employee share incentive or
option plan to be adopted, subject to approval of the directors of the
Company as soon as reasonably practicable following Completion. The
incentive or option plan shall have the features specified in Schedule
6.
19
10 FURTHER ASSURANCE
10.1 At any time after Completion, the Sellers shall (and shall use their
reasonable endeavours to procure that any necessary third party shall)
sign and execute all such documents and do all such acts and things as
the Buyer may reasonably require for effectively vesting the Shares in
the Buyer and otherwise giving the Buyer the full benefit of all the
provisions of this agreement.
10.2 Each of the Sellers shall following Completion provide all such
information relating to each Group Company, its business and affairs
within their respective custody, possession or control as the Buyer
shall reasonably request.
11 ANNOUNCEMENTS
No public announcement shall be made in connection with this agreement
without the prior written consent of each of the parties hereto
PROVIDED THAT the provisions of this clause 11 shall not apply to any
public announcement, communication or circular required by law or the
UKLA or the London Stock Exchange or NASDAQ or any other recognised
stock exchange or any regulatory body.
12 COSTS
Except where this agreement provides otherwise, each party shall pay
its own costs and the costs of its advisers relating to or in
connection with the negotiation, preparation, execution and performance
by it of this agreement and of each agreement or document entered into
pursuant to this agreement and the transactions contemplated by this
agreement (including the due diligence exercise conducted prior to
Completion). No such costs incurred by or on behalf of the Sellers
shall be charged to any Group Company.
13 VARIATIONS
A variation of this agreement, the Tax Deed or any agreement or
document entered into pursuant to this agreement is valid only if it is
in writing and signed by or on behalf of each party.
14 TIME OF THE ESSENCE
Time shall be of the essence of this agreement, the Tax Deed and any
agreement or document entered into pursuant to this agreement, both as
regards the dates and periods set out and as regards any dates and
periods which may be substituted for them in accordance with this
agreement, the Tax Deed or any agreement or document entered into
pursuant to this agreement or by agreement in writing between the
parties.
15 REMEDIES
15.1 The failure to exercise or delay in exercising a right, power or remedy
provided by this agreement or by law does not constitute a waiver of
any such right, power or remedy or a waiver of other rights, powers or
remedies. No single or partial exercise of a right, power or remedy
provided by this agreement or by law prevents further exercise of any
such right, power or remedy or the exercise of any other right, power
or remedy.
15.2 The rights, powers and remedies of any party hereunder are cumulative
and not exclusive of any right, power or remedy provided by law.
20
15.3 Any rights of rescission or termination conferred upon the Buyer by
this agreement shall be in addition to and without prejudice to all
other rights and remedies available to the Buyer and no exercise or
failure to exercise, or delay in exercising, such rights of rescission
or termination shall constitute a waiver by the Buyer of any other
rights or remedies.
15.4 The provisions of this agreement insofar as the same shall not have
been performed at Completion shall remain in full force and effect
notwithstanding Completion.
15.5 Notwithstanding any rule of law or equity to the contrary, any release,
waiver or compromise or any other arrangement of any kind whatsoever to
which the Buyer may agree or effect in relation to any one of the
Sellers in connection with this agreement or the Tax Deed or any
agreement or document entered into pursuant to this agreement, and in
particular, but without limitation, in connection with any of the
Warranties, shall not affect the rights and remedies of the Buyer as
regards any other of the Sellers.
16 ASSIGNMENT
16.1 To the extent referred to in clause 16.2 this agreement, the Tax Deed
and each of the agreements and documents executed pursuant to this
agreement shall be binding upon and enure for the benefit of the
successors in title of the parties.
16.2 The benefit of this agreement, the Tax Deed or any agreement or
document entered into pursuant to this agreement may not be assigned
other than by the Buyer to any member of the Buyer's Group PROVIDED
THAT if any such assignee ceases for any reason to be a member of the
Buyer's Group, such assignee shall be deemed to have assigned all such
benefits back to the Buyer immediately prior to its ceasing to be a
member of the Buyer's Group.
17 SEVERANCE
If any term or provision in this agreement shall be held to be illegal
or unenforceable, in whole or in part, under any enactment or rule of
law, such term or provision or part shall to that extent be deemed not
to form part of this agreement but the enforceability of the remainder
of this agreement shall not be affected.
18 ENTIRE AGREEMENT
This agreement, the Tax Deed and any agreement or document entered into
pursuant to this agreement contain the entire agreement between the
parties relating to the sale and purchase of the whole of the issued
share capital of the Company and the Buyer acknowledges that save for
the matters expressly contained in this agreement the Buyer has not
entered into this agreement in reliance on any representation warranty
or agreement of the Sellers.
19 INTEREST
If the Sellers or the Buyer shall default in the payment when due of
any sum payable under this agreement, the Tax Deed or any agreement or
document entered into pursuant to this agreement (whether determined by
agreement or pursuant to an order of a court or otherwise) the
liability of the paying party shall be increased to include interest on
such sum from the date when such payment is due up to and including the
date of actual payment (as well after as before judgement) at a rate
per annum of 2% above the
21
base rate from time to time of Lloyds TSB Bank plc. Such interest shall
accrue from day to day.
20 COMPETITION
If the Buyer in its absolute discretion considers it desirable or
necessary for any reason whatsoever (and no admission is made by the
Buyer in this respect) to notify this agreement to the European
Commission (under Regulation 17/62/EEC) and/or to the Office of Fair
Trading (under the Competition Act 1998) for clearance and/or
exemption, the Sellers shall co-operate in such notification. Without
limitation to the foregoing, the Sellers shall provide the Buyer with
all information required by the European Commission and/or the Office
of Fair Trading for the purposes of such notification.
21 NOTICES
21.1 A notice or other communication under or in connection with this
agreement shall be in writing and shall be delivered by hand or sent by
first class post pre-paid recorded delivery (or by air mail if sent to
an address outside the United Kingdom) or by facsimile to the party due
to receive the notice or communication, at its address set out in this
agreement or at such other address specified by that party by written
notice to the others. A copy of such notice from the Sellers pursuant
to this clause 21.1 shall be sent at the same time to both the Buyer's
Solicitors and to Xxxxxx Gesmer and Xxxxxxxxx, LLP of 00 Xxxxx Xxxxxx
Xxxxxx, XX 00000
21.2 In the absence of evidence of to the contrary, a notice or other
communication is deemed given:
(a) if delivered by hand, at the time of actual delivery to the
address referred to in clause 21.1;
(b) if sent by mail except air mail, 2 Business Days after posting
it;
(c) if sent by air mail, 10 Business Days after posting it; and
(d) if sent by facsimile, on production of a transmission report from
the machine which sent the facsimile indicating that the
facsimile was sent in its entirety to the facsimile number of the
recipient.
22 COUNTERPARTS
This agreement may be executed in any number of counterparts and by the
different parties on separate counterparts (which may be facsimile
copies), each of which when executed and delivered shall be an
original, but all the counterparts together shall constitute one and
the same instrument.
23 THIRD PARTY RIGHTS
23.1 No person who is not a party to this agreement may enforce any term of
this agreement. The parties agree that the Contracts (Rights of Third
Parties) Act 1999 shall not apply to this agreement or to any agreement
or document entered into pursuant to this agreement.
23.2 Subject to clause 23.3, no person who is not a party to this agreement
may enforce any term of this agreement. Clauses 23.3 and 23.5 set out
the sole basis on which the
22
Contracts (Rights of Third Parties) Xxx 0000 shall apply to this
agreement and any agreement or document entered into pursuant to this
agreement.
23.3 Where a term of this agreement is expressed to be for the benefit of,
or confers or purports to confer a right on members of the Buyer's
Group or a member of the Company Group, it shall be enforceable by each
such person.
23.4 The provisions of clauses 5 and 8 shall be enforceable against the
Sellers by any member of the Buyer's Group.
23.5 This agreement may be varied by agreement between the parties to this
agreement and/or rescinded or terminated by the Buyer in accordance
with the provisions of this agreement and the consent of any person who
is not a party to this agreement shall not be required for any such
variation, rescission or termination, as the case may be.
24 GOVERNING LAW
24.1 This agreement shall be governed by and construed in accordance with
English law.
24.2 The courts of England shall have non exclusive jurisdiction to hear and
decide any suit, action or proceedings, and to settle any disputes,
which may arise out of or in connection with this agreement, the Tax
Deed or any agreement or document entered into pursuant to this
agreement and, for these purposes, each party irrevocably submits to
the non-exclusive jurisdiction of the courts of England.
IN WITNESS WHEREOF, this Agreement has been duly executed by each of the
parties on the date stated above.
23
SIGNED by XXXXXXX )
XXXXXX XXXXXXXXX in ) /s/ Xxxxxxx Xxxxxx Xxxxxxxxx
the presence of: )
/s/ Xxxxx Xxxxx
SIGNED by SATISH R )
XXXXXXX in the ) /s/ Xxxxxx X. Xxxxxxx via his attorney
presence of: )
/s/ Xxxxx Xxxxx
SIGNED by XXXXX )
XXXXXXX XXXXXXX in the ) /s/ Xxxxx Xxxxxxx Xxxxxxx
presence of: )
/s/ Xxxxx Xxxxx
SIGNED by XXXXX
XXXXXX for and on behalf of /s/ A. Xxxxx Xxxxxx
I-MANY INC in the presence of:
24
AGREED FORM DOCUMENTS
1. Tax Deed
2. Disclosure Letter
3. Service Agreements
4. Secretary's resignation letters
5. Auditors' resignation letter
6. Power of Attorney in respect of the Shares
7. Xxxx Xxxxxxx Waiver
8. US and UK name transfers
9. Legal Opinion
25
