EX-2.1
2
ex2-1toform8k.htm
EXHIBIT 2.1 TO FORM 8-K -- EPS SHARE PURCHASE AGREEMENT
EXHIBIT
2.1
SHARE
PURCHASE AGREEMENT
This
PURCHASE AGREEMENT (this “Agreement”)
dated
as of May 11, 2006 is entered into by and among:
Transaction
Systems Architects, Inc.,
a
corporation organized and existing under the laws of the State of Delaware,
with
registered office at 000 Xxxxx 000xx
Xxxxxx,
Xxxxx, Xxxxxxxx 00000, X.X.X. (“Purchaser”);
PREIPO
Beratungs- und Beteiligungsgesellschaft mbH,
a
limited liability company (Gesellschaft
mit beschränkter
Haftung)
organized and existing under the laws of the Federal Republic of Germany,
registered with the commercial register of the local court of
Wiesbaden under
HRB
19363 (“Preipo”);
RP
Vermögensverwaltung GmbH,
a
limited liability company (Gesellschaft
mit beschränkter
Haftung)
organized and existing under the laws of the Federal Republic of Germany,
registered with the commercial register of the local court of Bad
Homburg under
HRB
7301 (“RP”,
and
together with PREIPO the “Main
Sellers”);
Xx.
Xxxxxxxxx Xxxxx,
an
individual residing at Xxxxxxxxxxx. 0, 00000 Xxxxxxxxxxxxx (“Principal
1”);
Mr.
Johann Praschinger,
an
individual residing at Xx Xxxxxxxx 00, 00000 Xxxxxxxxxxxxxx (“Principal
2”
and
together with Principal 1, the “Principals”);
eps
Electronic Payment Systems AG, a
stock
corporation (Aktiengesellschaft)
organized and existing under the laws of the Federal Republic of Germany,
registered with the commercial register of the local court of Wiesbaden under
HRB 19288 (“EPS”).
Capitalized
terms used and not defined herein shall have the meaning ascribed to them
in
Exhibit
A
to this
Agreement.
PREAMBLE
WHEREAS,
EPS is
primarily engaged in the business of research and development and marketing
of
software relating to the authorization, switching and settlement of electronic
payment transactions (the “Business”);
WHEREAS,
EPS
conducts the Business through its own operations as well as through Electronic
Payment Systems Limited, a limited company organized and duly existing under
the
laws of England and Wales (“EPS
Ltd”),
S.C.
Electronic Payment Systems Romania S.R.L., a company incorporated and duly
existing under the laws of Romania (“EPS
Romania”),
eps
Electronic Systems Schweiz GmbH, a limited liability company (Gesellschaft
mit beschränkter
Haftung)
incorporated and duly existing under the laws of Switzerland (“EPS
Switzerland”,
eps
Prepaid GmbH, a limited liability company (Gesellschaft
mit beschränkter
Haftung)
incorporated and duly existing under the laws of the Federal Republic of
Germany
(“EPS
Prepaid”)
and
eps NZ Limited, a limited company incorporated and duly existing under the
law
of New Zealand (“EPS
NZ”
and
together with EPS Ltd., EPS Romania, EPS Switzerland and EPS Prepaid, the
“Subsidiaries”;
EPS
and the Subsidiaries shall be referred to individually as a “Company”
and
collectively as the “Companies”;
WHEREAS,
the
shares of EPS consisting of 1,110,000 registered common shares (Namens-Stammaktien)
(the
“Shares”)
are
held by Main Sellers and other shareholders of EPS as set forth in further
detail in Exhibit
B
hereto;
WHEREAS,
Preipo holds 431,715 of the
Shares (the “Preipo Shares”) and RP holds 142,200 of the Shares (the
“RP Shares”, and, together with the Preipo Shares, the “Main Sellers’
Shares”);
WHEREAS,
Purchaser desires to
acquire, and Main Sellers desire to sell, the Main Sellers’ Shares on the terms
hereinafter set forth;
WHEREAS,
Purchaser further desires
to acquire all of the shares (the “Secondary Sellers’
Shares”), held by the persons listed on Exhibit B hereto
other than those persons marked with an asterisk on Exhibit B
hereto and the Main Sellers (each a “Secondary Seller” and collectively,
the “Secondary Sellers”); the Main Sellers’ Shares and the Secondary
Sellers’ Shares shall collectively be referred to as the “Initial
Shares”;
WHEREAS,
the Main Sellers are owned and controlled by the Principals or their respective
spouses and the Principals have a financial interest in the sale of the Main
Sellers' Shares.
NOW,
THEREFORE,
the
Parties agree as follows:
ARTICLE
I
PURCHASE,
SALE AND TRANSFER OF THE INITIAL SHARES
1.1 Sale
of
Main
Sellers’
Shares.
Effective as of the date hereof, Preipo
hereby
sells (verkauft)
the
Preipo
Shares
and XX
xxxxx the RP Shares,
including any rights to retained earnings or to receive dividends or other
distributions, to Purchaser, and Purchaser hereby accepts such
sales.
1.2 Transfer
and Assignment of Main
Sellers’
Shares.
Effective as of the Initial Closing Date, and subject to the conditions
precedent set forth in ARTICLE V hereof,
(a)
Preipo
hereby
transfers
and
assigns (xxxxx
xx)
the
Preipo
Shares,
including any rights to retained earnings or to receive dividends or other
distributions, to Purchaser, and (b)
RP
hereby transfers and assigns (xxxxx
xx)
the RP
Shares, including any rights to retained earnings or to receive dividends
or
other distributions, to Purchaser. Purchaser
hereby accepts such transfers and assignments.
1.3 Secondary
Sellers’ Shares.
Effective as of the Initial Closing Date, Seller shall
cause the Secondary Sellers to sell,
transfer and assign the Secondary Sellers’ Shares to Purchaser.
1.4 Consent
to Transfer and Assignment of Initial Shares.
EPS
hereby consents to the transfer and assignment of the Initial Shares to
Purchaser.
1.5 Entry
into Share Register.
Immediately after the transfer and assignment of the Initial Shares pursuant
to
Section 1.2
hereof
and the transfer, EPS shall delete the Main Sellers and Secondary Sellers
from,
and enter Purchaser as new owner of all Initial Shares in, the share register
(Aktienregister)
of EPS
in accordance with Section 67 para. 3 AktG.
ARTICLE
II
CONSIDERATION
2.1 The
aggregate consideration to be paid by Purchaser to the Main Sellers for and
in
connection with the sale, assignment and transfer of the Main
Sellers’
Shares
pursuant to ARTICLE I hereof shall consist of:
(a) a
cash
payment in the amount of EUR 4,751,817.40 (the “Cash
Consideration”)
to be
paid in accordance with Section 3.1 hereof; and
(b) the issuance
of 301,075 shares of restricted stock of Purchaser (the
“Stock
Consideration”)
to be
provide in accordance with Section 3.2 hereof.
ARTICLE
III
PAYMENTS
AND
ESCROW; RESTRICTED STOCK
3.1 Closing
Payments.
On the
Initial Closing Date, Purchaser shall make the following payments:
(a) a
portion
of the Cash Consideration in an amount of EUR 2,824,442.91 to an account of
Preipo to be designated by Preipo at least 5 days prior to the Initial Closing
Date;
(b) a
portion
of the Cash Consideration in an amount of EUR 1,177,374.49 to an
account of RP to be designated by RP at least 5 days prior to the Initial
Closing Date;
(c) a
portion
of the Cash Consideration in an amount of
EUR
750,000 (the
“Escrow
Amount”)
to an
account designated jointly by Purchaser and the Main Sellers prior to the
Initial Closing (the “Escrow
Account”).
3.2 Issuance
of Restricted Stock.
On the
Initial Closing Date, Purchaser shall provide the Stock Consideration by
causing
the delivery of restricted stock agreements to the Main Sellers providing
for (a) an issuance to Preipo in the amount of 226,477
shares of restricted stock, and (b) an issuance to RP in the amount of
74,598 shares of restricted stock.
The
restricted shares issued pursuant to this Section 3.2 shall become
non-forfeitable over five-years; the details of such restricted
stock issuances are set forth in restricted stock grant agreements
substantially in the form attached hereto as Exhibit
3.2
hereto
(the “Restricted
Stock Agreements”).
ARTICLE
IV
ESCROW
AND SET-OFF RIGHT AGAINST RESTRICTED STOCK
4.1 Security
Purpose of Restricted Stock.
The forfeitable portion of the Stock Consideration issued pursuant to the
Restricted Stock Agreements shall serve as security for the indemnification
obligations of the Main Sellers pursuant to Sections 12.1(a), 12.1(b) and
12.1(c) hereof and any indemnification obligations of the Principals
hereunder. The details regarding the set-off/forfeiture procedure are provided
in the Restricted Stock Agreements.
4.2 Security
Purpose of Escrow.
The
Escrow Amount shall serve as security for
the
Main Sellers’ indemnification obligations under Section 12.1(b)(i) hereof
(Commerzbank Lease).
4.3 Release
of Escrow Amount.
The
Escrow Amount plus any interest accrued thereon shall be released from the
Escrow Account and transferred to a bank account to be designated by
Preipo
on the earlier of (i) two weeks after the date on which Commerzbank has
either
made
the
full residual payment to EPS
or
has made a binding written commitment to make such residual payment in
full,
or (ii)
three years after the Initial Closing Date (the “Final Escrow Release
Date”), provided,
however, that in case that, on or before the Final Escrow Release Date,
any indemnification claims covered by the Escrow Amount have been asserted
by
Purchaser in accordance with ARTICLE XII hereof, the amount of such
indemnification claims shall be released from the Escrow Account to Preipo
or
the Purchaser, as the case may be, only after the final settlement of such
claims.
4.4 Escrow
Agreement.
Details
of the Escrow Account and the disbursement and release mechanisms related
thereto are set forth in an escrow agreement substantially in the form attached
as Exhibit
4.4
hereto
(the “Escrow
Agreement”)
which
will be executed at the Initial Closing. The fees of the escrow agent are
borne
by Purchaser.
ARTICLE
V
CONDITIONS
TO THE
OBLIGATION OF PURCHASER
The
respective obligations of Purchaser to consummate the transactions contemplated
under this Agreement are subject to the following conditions:
5.1 Secondary
Share Purchase Agreements.
The
Secondary Sellers
shall
have entered into Secondary Share Purchase Agreements substantially in the
form attached as Exhibit
5.1 hereto (the
“Secondary
Share Purchase Agreements”),
each
providing for the sale, assignment and transfer of the amount of shares set
forth on Exhibit
B
next to
each Secondary Seller at a per share purchase price of EUR 25.94.
5.2 Execution
of Escrow Agreement.
The
Escrow Agreement shall have been executed by the parties thereto.
5.3 Restricted
Stock Agreements.
The
Restricted Stock Agreements shall have been executed by the parties
thereto.
5.4 Resignation
Letters of Supervisory Board Members.
The
members of EPS’ supervisory board (Aufsichtsrat)
have
executed resignation letters in the form attached as Exhibit
5.4 hereto
as of a
date to be specified by Purchaser to the Main Sellers in writing within 7
days
following the date hereof.
5.5 Supervisory
Board Resolution.
The
members of EPS’ supervisory board (Aufsichtsrat)
have
entered into a unanimous resolution (a) approving the execution of this
Agreement and the transaction, agreements and other documents contemplated
thereby, and (b) appointing Xxxxxxx Xxxxxxx and Xxxxxxx Xxxxxx as members
of the
management board (Vorstand),
with
sole representation authority and exemption from the restrictions set forth
in
Section 181 2nd
alternative BGB.
5.6 Employment
Agreements.
Principal 1 and Principal 2 shall have entered into new employment
agreements in a form mutually
acceptable to Purchaser and each Principal.
5.7 Agreements
with CFO.
The
existing consulting agreement between EPS and Xx. Xxxx Xxxxxxxx shall have been
terminated and an interim service agreement in a form mutually acceptable
to
Purchaser and Xx. Xxxxxxxx shall
have been concluded.
5.8 Acknowledgements
by Contractors/Freelancers.
EPS
shall have received acknowledgement of its contractors and freelancers listed
in
Exhibit
5.8
hereto,
which acknowledgement letters shall be in a form reasonably acceptable to
Purchaser.
5.9 Loan
Agreements to Principals.
All
loans extended by EPS to Principal 1 and Principal 2 shall have been repaid
in
full or the Parties shall have otherwise agreed to repay such loans from
the
respective Principal’s Cash Consideration contemplated under Section
3.1.
5.10 Correctness
of Representations and Warranties.
The
representations and warranties of the Main Sellers pursuant to ARTICLE VII
hereof and the covenants set forth in ARTICLE IX hereof shall be true and
correct as of the Initial Closing Date.
The
conditions set forth in this ARTICLE V may be waived only by Purchaser.
Purchaser shall be entitled to rescind this Agreement if the condition set
forth
in Sections 5.1 through 5.10 have not been fulfilled by May 31,
2006.
ARTICLE
VI
INITIAL
CLOSING
6.1 Initial
Closing.
The
initial closing of sale and transfer of the Initial Shares provided for herein
(the “Initial
Closing”)
shall
occur at 10.00 a.m. on May 31, 2006 at the offices of Xxxxx Day, Xxxxxxxxxxxx
000, 00000 Xxxxxxxxx, or, if any of the conditions to closing set forth in
ARTICLE V hereof have not occurred at such time and have not been waived,
at
such other time, date and place as may be mutually agreed to in writing by
the
Parties. The date on which the Initial Closing occurs shall be referred to
as
the “Initial Closing
Date”.
6.2 Main
Sellers’ Closing Deliveries.
At the
Initial Closing, Main Sellers shall deliver, or cause to be delivered, to
Purchaser:
(a) copies
of
all Secondary Share Purchase Agreements;
(b) an
executed copy of the Escrow Agreement;
(c) executed
copies of the Restricted Stock Agreements;
(d) executed
copies of the resignation letters of EPS’ supervisory board members as provided
in Section 5.4 hereof;
(e) an
executed copy of the supervisory board resolution as provided in Section
5.5
hereof;
(f) executed
copies of the new employment agreements of Principal 1 and Principal 2 as
provided in Section 5.6 hereof;
(g) an
executed copy of the interim service agreement of Xx. Xxxx Xxxxxxxx as provided
in Section 5.7 hereof;
(h) executed
copies of the acknowledgement letters as provided in Section 5.8
hereof;
(i) a
written
statement of the Main Sellers certifying as to the correctness of the
representations and covenants of the Main Sellers;
(j) a
written
statement confirming the transfer to Purchaser of and the ownership of Purchaser
in the Initial Shares; and
(k) a
written
statement confirming the receipt of payments set forth in Section 3.1 hereto
and
the receipt of the Restricted Stock Agreements set forth in Section 3.2
hereof.
6.3 Purchasers’
Closing Deliveries.
At the
Closing, Purchaser shall deliver, or cause to be delivered
(a) the
payments set forth in Section 3.1 hereof; and
(b) the
Restricted Stock Agreements set forth in Section 3.2 hereof plus any restricted
stock agreements contemplated in any of the Secondary Share Purchase Agreements,
all executed by Purchaser.
ARTICLE
VII
REPRESENTATIONS
AND WARRANTIES OF MAIN SELLERS
The
Main
Sellers hereby jointly and severally represent and warrant to Purchaser,
in the
form of an independent guarantee (selbständiges
Garantieversprechen) pursuant
to Section 311 BGB
that as
of the date hereof and as of the Initial Closing Date:
7.1 Organization;
Corporate Power and Authority.
Each of
the Main Sellers and the Companies is duly organized and existing under
the laws
of the jurisdiction of its incorporation or organization and properly qualified
in all applicable foreign jurisdictions where it conducts business and
has all
necessary power and authority (corporate and otherwise), licenses, and
qualifications to own and lease its property and assets and carry on its
business as presently owned and conducted. Each of the Main Sellers and
EPS has
duly authorized and executed this Agreement and has full power and authority
to
execute and perform its obligations under this Agreement and the other
agreements, documents, and instruments contemplated herein without the
necessity
of any act or consent of any other Person whomsoever. This Agreement and
the
other agreements, documents, and instruments contemplated herein, when
executed
by all Parties, constitute the valid and binding obligations of Main Sellers
and
EPS, enforceable in accordance with their terms. Neither the Main Sellers
nor
the Companies have taken or failed to take any action, which action or
failure
would preclude or prevent Purchaser or the Companies from conducting the
Business as previously conducted. The articles of association of each of
the
Main Sellers and the Companies (other than EPS NZ, attached hereto as
Exhibit 7.1,
are
presently valid and in force and no changes have been resolved or will
be
resolved until the date hereof. Contemporaneously herewith, each of the
Main
Sellers and EPS has delivered and EPS has caused the Subsidiaries to
deliver to Purchaser true, correct, current, and complete certified copy
of
their commercial register extract or comparable non-German corporate
records.
7.2 Capitalization.
(a) EPS
has a
total stated capital (Grundkapital)
of EUR
1,110,000.00, represented by the Shares which represent all of the shares
(Aktien)
of EPS
and are divided into 1,110,000 registered common shares (Stammaktien)
with a par value of EUR 1.
(b) The
Main
Sellers’ Shares
are owned legally and beneficially by each of the Main Sellers in the amounts
set forth on Exhibit
B
hereto,
free and clear of any Liens
and
include all ancillary rights (including any pre-emptive rights (Bezugsrechte))
attributable thereto. No share certificates have been issued in respect of the
Shares. The Main Sellers have not granted any Person any proxy or other
rights
with respect to the voting rights of the
Main
Sellers’
Shares
nor are
they a party to any arrangement or agreement (including any voting agreement
(Stimmbindungsvertrag)
granting such rights with respect to any of the Main
Sellers’
Shares.
(c) The
Shares are each duly authorized, validly issued, registered in the commercial
register, fully paid, have not been repaid, and are not subject to assessment.
Other than the Subsidiaries, EPS does not have and has not had any subsidiaries.
Except as set forth in Exhibit
7.2(c)-1
hereto,
other than the Shares, there are no other securities of EPS of any class
or kind
issued, reserved for issuance, convertible, or outstanding and there are
no
restrictions with respect to transferability of the Shares. Except as set
forth
in Exhibit
7.2(c)-2
hereto,
there are no options, offers, warrants, conversion rights, take-along rights,
co-sale rights, preemptive rights, subscriptions or agreements or rights
of any
kind to subscribe for, or to sell or purchase, or commitments to issue
(either
formal or informal, firm or contingent), existing or future share or equity
capital or securities of or interests or rights in EPS (whether debt, equity,
or
a combination thereof) or obligating EPS or any shareholders to grant,
extend,
or enter into any such agreement or commitment. Exhibit
7.2(c)-2
hereto
contains a complete and correct listing of any such rights for each of
the Main
Sellers as well as any third party holding such rights; none of such rights
listed on Exhibit
7.2(c)-2
have
been exercised through the date hereof. EPS is not party to any enterprise
agreements within the meaning of Sections 291 and 292 AktG.
(d) Upon
the
sale, transfer, and assignment of the Main
Sellers’
Shares
as
herein contemplated, Purchaser will acquire the entire ownership of and
any and
all existing rights, interests, and participation in EPS with respect to
the
Main
Sellers’ Shares
and will
have good and marketable title to such shares, free and clear of any Liens
and
possess all rights (including voting rights) with respect thereto.
(e) EPS
Ltd.
has a total stated capital (Stammkapital)
of
GBP 101,100 represented
by 101,000 shares with a par value of GBP 1. EPS Switzerland has a total
stated
capital (Stammkapital)
of
SFR 20,000 represented
by one share (Gesch’ftsanteil)
with a
nominal amount of SFR 19,000 and one share with a nominal amount of SFR
1,000,
both owned by EPS. EPS Romania has a total stated capital (Stammkapital)
of LEI
2,220,000 Lei represented
by 20 shares with a nominal amount of LEI 111,000. EPS Prepaid has a total
stated capital (Stammkapital)
of
EURO 25,000 represented
by two shares with a nominal amount of EURO 12,500. EPS New Zealand has
a total
stated capital (Stammkapital)
of
NZ$ 100 represented
by 100 ordinary shares
with a
nominal amount of NZ$ 1 owned by EPS Ltd. The shares of the Subsidiaries
listed
in this Section 7.2(e) (the “Subsidiary
Shares”)
are
duly authorized, validly issued, registered in the commercial register
or any
comparable public registry, fully paid, have not been repaid, and are not
subject to assessment and, except as otherwise stated in this Section 7.2(e),
are owned legally and beneficially by EPS, free and clear of any Liens
and
include all ancillary rights (including any pre-emptive rights (Bezugsrechte))
attributable thereto. Except as otherwise stated in this Section 7.2(e),
the
Subsidiaries do not have and have not had any subsidiaries. Other than
the
Subsidiary Shares, there are no other securities of any Subsidiary of any
class
or kind issued, reserved for issuance, convertible, or outstanding and
there are
no restrictions with respect to transferability of the Subsidiary Shares.
There
are no options, offers, warrants, conversion rights, take-along rights,
co-sale
rights, preemptive rights, subscriptions or agreements or rights of any
kind to
subscribe for, or to sell or purchase, or commitments to issue (either
formal or
informal, firm or contingent), existing or future share or equity capital
or
securities of or interests or rights in any of the Subsidiaries (whether
debt,
equity, or a combination thereof) or obligating any Subsidiary to grant,
extend,
or enter into any such agreement or commitment. None of the Subsidiaries
is
party to any enterprise agreements within the meaning of Sections 291 and
292
AktG.
7.3 Conflicts;
Defaults.
Neither
the execution of this Agreement or the other agreements, documents, and
instruments contemplated herein by Main Sellers or the Companies, nor the
performance of any of their obligations hereunder or thereunder, will (i)
violate or conflict with any of the terms of any articles of association
or
other organizational documents of any of Main Sellers or the Companies
or
constitute a default or result in the acceleration of any obligation under
any
provisions of any Contract, or of any order, judgment, or decree by which
any of
the Main Sellers or the Companies is bound or by which any of the assets
or
properties of any of Main Sellers or the Companies may be affected, (ii)
result
in the creation or imposition of any Liens in favor of any third Person
upon any
assets or properties of any of Main Sellers or the Companies, or (iii)
violate
any Law applicable to any of Main Sellers or the Companies or any of their
respective assets or properties. Such execution, delivery, and performance
will
not give to others any rights, including rights of termination, cancellation,
or
acceleration, in or with respect to any Contract to which any of Main Sellers
or
the Companies is a party or by which it is bound.
7.4 Governmental
Approvals.
No
approval, consent, decree, or order of any Governmental Authority is required
in
connection with the execution and delivery of this Agreement by any of
Main
Sellers or the Companies, the performance of their obligations hereunder,
or the
consummation by any of them of the transactions contemplated hereby, or
for the
prevention of any termination of any right, privilege, license, or agreement
relating to the Business or the continuation of the Business following
the
execution hereof.
7.5 Third
Person Consents.
Except
as set forth in Exhibit 7.5
hereto,
no consent, approval, or authorization of any Person (“Third
Person Consent”)
is
required in connection with the execution, delivery, or performance of
this
Agreement or the other agreements, documents, and instruments contemplated
herein by any Main Seller or any of the Companies or the continuation of
the
Business by Purchaser and the Companies following the execution hereof
and the
date hereof.
7.6 Tangible
Assets.
The
Companies have and, upon consummation of the transactions set forth in
ARTICLE I
of this Agreement, will have good and marketable title to their respective
assets, free and clear of all Liens, except for those set forth in Exhibit 7.6-1
hereto.
Except as disclosed in Exhibit 7.6-2
hereto,
all assets located at any facilities used by the Companies are owned by
the
Companies. All such assets are in good operating condition and reasonable
state
of repair, subject only to ordinary wear and tear. None of the Main Sellers
or
the Companies has received any notice of violation of any applicable Law
relating to any such assets, and there is no such violation or grounds
therefor
which could adversely affect the operation of the Business as presently
conducted. Such assets are all tangible assets necessary, required, and
adequate
for Purchaser and the Companies to conduct the Business as presently conducted
without the need for additional capital expenditures.
7.7 Real
Property.
The
Companies do not own, lease, possess, occupy or otherwise utilize, and
have not
owned, leased, possessed, occupied or otherwise utilized, any real property
other than the leased real property described in
Exhibit 7.7-1
hereto
(the “Companies’
Leased Real Property”).
The
leases underlying the Companies' Leased Real Property are in full force
and
effect, are the valid and binding obligation of the respective Company
and the
lessor party thereto, and there are no outstanding defaults thereunder.
The
leases underlying the Companies’ Leased Real Property may not be terminated by
the respective lessor other than for cause. Except as set forth in Exhibit 7.7-2
hereto,
the
Companies do not lease, as lessor or sublessor, any real property. Other
than at
the Companies' Leased Real Property, the Companies do not have any material
assets situated at any other location. The Companies' Leased Real Property
is in
good operating condition and repair and suitable for the purposes for which
it
is being used. The Companies' Leased Real Property or the operation or
maintenance thereof does not violate any restrictive covenant or any provision
of any Law in any way that could adversely affect the present use thereof,
or
encroach on any real property owned by others. The Companies enjoy adequate
rights of ingress and egress with respect to the Companies' Leased Real
Property. There is no pending or threatened condemnation, expropriation,
or
similar proceeding pending or threatened against the Companies' Leased
Real
Property. All buildings, structures, and fixtures on the Companies' Leased
Real
Property are in good operating condition and in a state of good maintenance
and
repair, ordinary wear and tear excepted, were constructed in a good and
workmanlike manner without material defects, are adequate and suitable
for the
purposes for which they are presently being used, and are in compliance
with and
meet all of the conditions of all building permits. All utilities necessary
for
the use, occupancy, or maintenance of the Companies' Leased Real Property
or the
conduct of the Business (including gas, electricity, water, and telephone)
are
connected, adequate, and available in quantity and quality necessary to
conduct
the Business, all payments due with respect thereto are current, all such
utilities enter the Companies' Leased Real Property directly through adjoining
public lands and do not pass through private land, and there has been and
is no
threatened interruption or diminution of such utility services.
7.8 Contracts.
(a) Exhibit 7.8(a)-1
hereto
contains a complete and accurate list of all Material Contracts to which
the
Companies are a party or are bound on the date hereof, including any and
all
written or oral understandings or agreements, and the Main Sellers have
delivered a true and complete copy, or, if a Contract has not been reduced
to
writing, an adequate written description thereof, of each such Contract
to
Purchaser. The Contracts listed in Exhibit 7.8(a)-1
hereto
constitute all Contracts necessary for the conduct of the Business as presently
conducted or planned to be conducted. Except as identified in Exhibit 7.8(a)-2
hereto,
all such Contracts are, and will remain until and after the date hereof,
in full
force and effect, none of the Companies has breached or improperly terminated
any such Contract, or is in default under any such Contract, and no event
has
occurred which (whether with or without notice, lapse of time, or both)
would
constitute such a default, no consent is required under any Contract in
connection with the transactions contemplated by this Agreement for such
Contract to remain in full force and effect and no other Person is in default
under any Contract. The Companies have no Contracts in effect with any
of its
shareholders or their respective Affiliates other than as identified in
Exhibit 7.8(a)-3.
(b) Except
as
identified in Exhibit 7.8(b),
none of
the Companies is a party to and none of the Contracts is any of the
following:
(i) any
Contract, the ordinary consummation or performance of which would, either
by
itself or in the aggregate, have an adverse impact upon its business,
operations, or financial condition;
(ii) any
Contract which is outside of the normal, ordinary, and usual requirements
of its
business or at a price or prices Materially in excess, where purchasing,
or
below, where selling, of those otherwise available at the time such Contract
was
entered into;
(iii) any
Contract which authorizes others to perform services for, through or on
behalf
any of the Companies;
(iv) any
Contract affecting the ownership or leasing of, title to, or use of any
assets
and any maintenance or service agreements relating thereto;
(v) any
note
receivable;
(vi) any
Contract providing for payments based in any manner upon the sales, purchases,
receipts, income, or profits of any of the Companies;
(vii) any
franchise agreement, marketing agreement, or royalty agreement;
(viii) any
Contract with a creditor;
(ix) any
Contract regarding independent contractors, which is not terminable by
any of
the Companies on thirty (30) days’ notice or less without payment of any amount
for any reason whatsoever, or for any continuing payment of any type or
nature,
including any bonuses and vested commissions;
(x) any
Contract allowing for a termination, whether in whole or in part, or an
amendment thereof, in case of the transfer of all or part of the Shares,
or all
or some of the assets of the Business, no matter how formulated in such
Contract;
(xi) any
Contract restricting any of the Companies from carrying on its business
or any
part thereof or any other business anywhere in the world;
(xii) any
instrument or arrangement evidencing or related to indebtedness for money
borrowed or to be borrowed, whether directly or indirectly;
(xiii) any
Contract with any computer programmer, independent contractor, non-employee
agent, or other entity (other than an employee) to perform computer programming
services for any of the Companies;
(xiv) any
Contract containing most favored nation clauses (Meistbegünstigungsklauseln);
(xv) any
Contract with minimum purchase obligations, or ongoing obligations requiring
any
company to enter into certain Contracts;
(xvi) any
Contract providing for the delivery of any EPS Software in source code;
or
(xvii) any
Contract in which any company grants deep discounts or service free of
charge.
(c) Exhibit 7.8(c)
hereto
contains a complete and accurate list of material pending negotiations
regarding
future Contracts (i) to which any of the Companies will be a party or by
which
any of the Companies will be bound, or (ii) which relate to the
Business.
(d) All
products and services which have been delivered or provided by any of the
Companies conform to the specifications and terms of the respective Contract
and
all work performed by the Companies under such Contracts has been performed
in
accordance with the terms of the respective Contract and products (other
than
any deviations from such specifications or terms that have been made with
the
consent of or upon request of the other parties(s) to such Contract) and,
to the
Main Sellers’ Knowledge, services delivered or provided or work performed to
date pursuant to such Contracts will not be subject any of the Companies
to
warranty or similar claims in excess of the amount reserved for in the
Financial
Statements. Exhibit
7.8(d)
hereto
sets forth a complete and correct list of all warranty claims pending or
threatened against the Companies relating to any Contract or the Business.
The
reserves reflected in the Financial Statements with respect to warranty
costs
are based on the historical experience of the warranty cost incurred in
relation
to the revenue earned on the Contracts and are adequate to cover warranty
costs
for products manufactured or delivered and work performed through the date
hereof.
(e) Exhibit
7.8(e)
hereto
sets forth a true, complete, and correct list of each of the Companies’ 20
largest customers (the “Material
Customers”)
and
the Companies’ 20 largest suppliers (the“Material
Suppliers”)
by
contract value for the twelve month period ended December 31, 2005. Neither
Main
Sellers nor any of the Companies has received any notice from any Material
Customer or Material Supplier to the effect that such Material Customer
or
Material Supplier will
stop, or materially decrease the rate of supplying or purchasing, respectively,
materials, products, or services to or from any of the Companies, and there
are
no grounds for such a stoppage or decrease. Neither the goodwill of the
Business
nor the customer/supplier relationships have been adversely affected by
any
misconduct with respect to contractual obligations, quality problems, payment
behavior, financial difficulties, or other adverse circumstances.
(f) Exhibit
7.8(f)
hereto
sets forth a complete and correct list of all damage claims asserted by
customers received by the Companies during the three (3) years prior to
the date
hereof.
7.9 Financial
Statements and Information.
(a) The
Main
Sellers have delivered to Purchaser true, correct, and complete copies
of the
audited Annual Financial Statements of the Companies attached as Exhibit 7.9(a)
hereto.
Each
of
the Annual Financial Statements (A) presents, in all respects, a true and
fair
view of the financial condition, the assets and Liabilities and results
of
operation of each of the Companies as of the dates indicated therein and
the
results of operations and changes in the financial position of each of
the
Companies for the periods specified therein, and (B) have been prepared
in
conformity with generally accepted accounting principles pursuant to the
German
Commercial Code or any applicable foreign accounting Laws applied on a
consistent basis during the periods covered thereby and prior periods (except
in
each case as expressly stated therein).
(b) Exhibit 7.9(b)
sets
forth a correct and complete description of all transactions between a
shareholder of a Company or such shareholder’s Affiliate on the one side and a
Company on the other side during the 24-month
period ending May 11, 2006.
(c) Except
as
disclosed in Exhibit
7.9(c)
hereto,
since December 31, 2005 through the date hereof, there will have been no
negative or positive change of more than 10% of the amount shown in the
Financial Statements in any of the following balance sheet positions for
any of
the Companies: (i) intangible assets, (ii) payments on account, (iii) tangible
assets, (iv) inventories, (v) work in progress, (vi) accounts receivable,
(vii)
accruals, (viii) Liabilities to banks, (ix) trade payables, (x) payables
to
affiliated enterprises, or (x1) contingencies.
(d) Each
of
the Companies has accurately and completely maintained its respective books
and
records.
7.10 Liabilities.
(a) None
of
the Companies has nor, to the Main Sellers’ Knowledge, shall have any
Liabilities or obligations, whether absolute, accrued, contingent, or otherwise,
other than (i) Liabilities incurred or accrued in the ordinary course of
business since December 31, 2005, and which do not, either individually
or in
the aggregate, have a Material adverse affect on the business, assets,
or
operations of such Company, and (ii) Liabilities and obligations which
are
disclosed in Exhibit 7.10(a)
hereto
or fully and explicitly reserved against in the Financial Statements. Except
as
disclosed in Exhibit 7.10(a)
hereto,
none of, the Companies is in default with respect to any Liabilities or
obligations, and all Liabilities and obligations have been, or are being,
paid
and discharged as they become due.
(b) Except
as
disclosed in Exhibit 7.10(b)
hereto,
there are no loans, advances, or other like amounts, including any interest
due
thereon, from or to any current or former shareholder, members of the management
board or supervisory board, or employee of any of the Companies to or from
any
of the Companies. Exhibit 7.10(b)
sets
forth the original and current interest rate, the principal outstanding,
and the
remaining term of each such loan, advance, or other like amount. Except
as set
forth in Exhibit 7.10(b)
hereto,
none of the Companies has ever had any off-balance sheet undertakings,
and in
particular, has not granted any guarantees (in any form whatsoever, including
as
a comfort letter), sureties, warranties, or securities.
(c) EPS
Prepaid is not an operative company and does not have any
Liabilities.
7.11 Litigation.
There
is no Litigation pending or threatened against or affecting any of the
Companies
or the Business, and neither the Companies nor Main Sellers have received
notice
from any third Person manifesting a dispute that could result in any such
Litigation. There is no outstanding order, injunction, decree, consent,
judgment, or stipulation by or with any Governmental Authority by which
any of
the Companies, its assets, or the Business is or may be bound.
7.12 Regulatory
Compliance.
The
business as conducted by the Companies is being conducted in compliance
with all
applicable Laws of each jurisdiction where a Company conducts business,
including any jurisdiction to which products of the Business have been
delivered, and none of the Companies is in violation of any applicable
Laws,
including German, EU export or import laws, anti-corruption, anti-terrorism,
or
money-laundering laws.
7.13 Permits.
Each of
the Companies holds all Permits necessary for the conduct of the Business
and
the use of its respective assets. Exhibit 7.13
hereto
contains a complete and accurate list of all Permits issued by any Governmental
Authority to the Companies. Neither the execution and delivery of this
Agreement
nor the consummation of the transactions contemplated hereby will result
in the
termination of any Permit held by the Companies, and all such Permits will
inure
to the benefit of the Companies after consummation of the transactions
contemplated by this Agreement.
7.14 Employee
Matters.
(a) Exhibit 7.14(a)-1
hereto
sets forth a complete and accurate list of all employees, including directors
and officers, part-time employees, employees from temporary employment
agencies,
employees with pending employment agreements, or employment agreements
with a
fixed term of the Companies (collectively referred to herein as the
“Employees”),
including in each case their current position, total current annual compensation
(including bonus or other payments), the type of standard employment agreement
used, outstanding promises of additional remuneration, contractual entitlement
to a severance payment, actuarial value of accrued pension right (whether
vested
or unvested), years of service, date of birth, termination notice period,
and
special termination protection, if any. The employees listed in Exhibit 7.14(a)-1
hereto
include all employees material to or required for the conduct of the Business.
Exhibit 7.14(a)-2
hereto
contains true and complete copies of all standard employment agreements
used by
the Companies. Exhibit
7.14(a)-3
hereto
contains a list of the Employees with whom the Companies have not entered
into
written employment agreements and describes all material terms and conditions
of
their employment agreements with the Companies. Except as set forth in
Exhibit 7.14(a)-4
hereto,
none of the Employees has an employment agreement the provisions of which
materially deviate from those of the standard employment agreements contained
in
Exhibit 7.14(a)-2
hereto
or the terms and conditions of the oral employment agreements described
in
Exhibit
7.14(a)-3 hereto.
(b) Except
for the persons listed in Exhibit 7.14(a)-1
hereto,
no persons (i) have or will by operation of law become or (ii) have been
or will
by operation of law be deemed to be, employees of any of the Companies
or
Purchaser.
(c) Except
as
may be set forth in Exhibit
7.14(c) hereto,
there are no controversies pending or threatened which involve any Employees
prior to or on the date hereof. There has not been any significant matter
under
discussion by any of the Main Sellers or any of the Companies with any
labor
union, works council, authority regarding disabled persons or other body
of
employee representation, or any strike, work stoppage, or labor trouble
relating
to the Employees or the Business. Exhibit 7.14(c)
hereto
sets forth (i) each collective bargaining agreement (Tarifvertrag),
shop
agreement (Betriebsvereinbarungen),
collective promise (Gesamtzusagen),
or
other contract, agreement, or commitment with any labor union, works council,
or
other body of employee representation, relating to the Employees, or to
which
any of the Companies is bound, whether voluntarily or not, or by which
the
Business is affected, and (ii) each company practice (betriebliche
Übungen)
to
which EPS is bound.
(d) No
Employee has given or, to Main Sellers’ Knowledge is reasonably likely to give
notice of termination, and no circumstances exist which give any Employee
a
special right to terminate or modify its employment agreement; and (b)
the
execution of this Agreement or the transactions contemplated therein do
not
trigger any such rights of any Employee.
(e) Exhibit 7.14(e)-1
hereto
lists all employees and former employees (within the past two years) of
the
Companies or any Affiliate of the Companies who are not listed in Exhibit 7.14(a)-1
hereto
but who were involved in the management or development of the Companies
in any
material way and describes such involvement.
7.15 Benefit
Plans.
Exhibit 7.15-1
hereto
lists every pension, retirement, profit-sharing, deferred compensation,
stock
option, employee stock ownership, severance pay, vacation, bonus, or other
incentive plan, any other written or unwritten employee program, arrangement,
agreement, or understanding (whether arrived at through collective bargaining
or
otherwise), any medical, vision, dental, or other health plan, any life
insurance plan, or any other employee benefit plan or fringe benefit plan,
currently or previously adopted, maintained, sponsored, in whole or in
part, or
contributed to by any of the Companies, Main Sellers, or any Affiliate
of Main
Sellers for the benefit of any of the Employees, retirees, dependents,
spouses,
directors, independent contractors, or other beneficiaries of any of the
Companies and under which any of the Employees, former employees, retirees,
dependents, spouses, directors, independent contractors, or other beneficiaries
of any of the Companies are eligible to participate or in connection with
which
any of the Companies may have any contingent or non-contingent Liability
of any
kind whether or not probable of assertion (collectively, the “Benefit
Plans”);
such
list correctly states the legal basis for each Benefit Plan and the nature
of
the respective agreements or other commitments.. Except as set forth in
Exhibit 7.15-1,
none of
the Companies maintains or contributes to any Benefit Plans or other agreements
or arrangements for the benefit of its employees nor has any of the Companies
taken any action directly or indirectly to obligate it under, or to institute
any such plan. Each of the Companies has complied with all applicable Laws,
terms and conditions of, and has no Liabilities or obligations with respect
to,
its Benefit Plans, and the Benefit Plans are valid and enforceable in accordance
with their terms and conditions. Any contributions required to be made
by any of
the Companies to pension, social, medical, or other insurance for the Employees
have been made, including for all persons, whether considered independent
or as
employees by such Company, who would be considered employees by Law. There
are
no Liabilities with respect to the Benefit Plans, whether absolute, accrued,
contingent, or otherwise, other than those set forth in Exhibit 7.15-2.
The
consummation of the transactions contemplated by this Agreement will not
(i)
entitle any current or former employee of any the Companies to severance
pay,
unemployment compensation, or any payment contingent upon a change in control
or
ownership, or (ii) accelerate the time of payment or vesting, or increase
the
amount, of any compensation due to any such employee or former employee.
All
Liabilities or obligations of the Companies for pension and other benefits,
including Christmas and other bonuses, 13th-month
salaries, vacation and other allowances, and overtime compensation are
fully
reflected and adequately accrued for in the Financial Statements.
In the
past, all pensions provided by the Companies have been adjusted regularly
as
required by Section 16 German Company Pension Act (BetrAVG)
or,
where applicable, by equivalent provisions of foreign law or contractual
provisions, and no backlog adjustments (nachholende
Anpassungen)
are
required to be made for periods until the Initial Closing Date.
7.16 Taxes.
(a) Each
of
the Companies, with respect to their respective ownership of the Shares,
have,
as of the date hereof and as of the Initial Closing Date, and will have
prior to
the date hereof, timely and accurately filed all Tax returns and reports
required to be filed by it prior to such dates and have timely paid, or
will
prior to the date hereof timely pay, all Taxes shown on such returns and/or
owed
for the periods of such terms, including withholding or other payroll related
Taxes. All such Tax Returns were correct and complete in all respects and
were
prepared in substantial compliance with all applicable laws and regulations.
Neither EPS nor any of its Subsidiaries currently is the beneficiary of
any
extension of time within which to file any Tax Return. No claim has ever
been
made by an authority in a jurisdiction where any of the Companies does
not file
Tax Returns that EPS or any of its Subsidiaries is or may be subject to
taxation
by that jurisdiction. There are no Liens for Taxes (other than Taxes not
yet due
and payable) upon any of the assets of any of the Companies. Except as
described
in Exhibit 7.16(a),
the tax
basis of all assets of each of the Companies is the same as the book basis
reflected on such Company’s books.
(b) Except
(i) as described in Exhibit 7.16(b),
or (ii)
to the extent that Liabilities are expressly reserved against in the Financial
Statements, there is not and, to the Main Sellers’ Knowledge, there will not be,
any Liability for any Taxes arising out of, attributable to, or affecting
the
assets of any of the Companies through the close of business on the date
hereof
and the Initial Closing Date, or attributable to the conduct of the operations
of a Company or at any time through the date hereof or the Initial Closing
Date,
for which any Company will have any Liability for payment or for otherwise
satisfying. After the date hereof, there does not and will not exist by
virtue
of the transactions contemplated by this Agreement any Liability for Taxes
which
may be asserted by any taxing authority against any of the Companies, or
their
respective assets, and no Lien or other encumbrance for Taxes will attach
to the
any of the Companies, or their respective assets.
(c) No
assessments or notices of deficiency or other communications have been
received
by any of the Companies with respect to any Tax return which has not been
paid,
discharged, or fully reserved for in the Financial Statements, and no amendments
or applications for refund have been filed or are planned with respect
to any
such return. No Tax audits or administrative or judicial Tax proceedings
are
pending or being conducted with respect to EPS or any of its subsidiaries
and no
notice indicating an intend to open a Tax audit or review has been
received.
(d) There
are
no agreements between any of the Companies and any taxing authority waiving
or
extending any statute of limitations with respect to any Tax return, and
none of
the Companies or has filed any consent or election, other than such consents
and
elections, if any, reflected in such Company’s Tax return for its taxable year
ended December 31, 2005. Contemporaneously with the delivery of the Exhibits
to
this Agreement, Main Sellers have delivered to Purchaser true, correct,
and
complete copies of the Tax returns for each of the Companies for the taxable
year ended December 31, 2005. None of the Companies is a party to or bound
by
any Tax allocation or sharing agreement.
7.17 Brokers.
No
broker has acted for any of the Main Sellers or their respective Affiliates
in
connection with this Agreement or the transactions contemplated
hereby.
7.18 Environmental
Matters.
To the
Main Sellers’ Knowledge, neither the Companies’ Leased Real Property nor any
real property owned, leased or otherwise used by any of the Companies in
the
past has been used for the handling, treatment, storage, or disposal of
any
Hazardous Substances. With respect to the assets of each of the Companies
and
the Companies’ Leased Real Property, there are no circumstances which could
result in an obligation or Liability of Purchaser its Affiliates or any
of the
Companies for environmental problems, and in particular, (i) no discharges,
emissions, releases, or threatened releases of any pollutants, contaminants,
or
hazardous or toxic wastes, substances, or materials into ambient air, water,
ground water, ground, or underground occurred or are likely to occur on,
prior
to, or after the date hereof and (ii) no environmental Liabilities or
obligations exist regarding the manufacture, processing, generation,
distribution, use, treatment, storage, disposal, clean-up, transport, or
handling of such substances or materials. The Companies have conducted
and
maintained the Business in compliance with all applicable environmental
and
safety Laws, and there are no claims, actions, proceedings, or investigations
of
any nature pending or threatened against any of the Companies regarding
any
violation of such Laws.
7.19 Bank
Accounts.
Attached hereto as Exhibit 7.19
hereto
is a list of all accounts, authorized signatories thereof, and deposit
boxes
maintained by any of the Companies at any bank or other financial
institution.
7.20 EPS-Software;
Open Source Software.
(a) EPS
is
the sole and beneficial owner of all rights in the Intellectual Property
and
other property pertaining to the electronic payment software, including
all
object code, source code, documentation and other material in respect thereof,
as described in more detail in Exhibit
7.20(a)-1
hereto
(the “EPS
Software”).
Except as set forth in Exhibit
7.20(a)-2 hereto,
EPS, EPS Ltd and EPS Romania are, as the case may be, full owners and
possessors, of all proprietary data and information generated during, and
required for, the development of the EPS Software, and have not provided
any
such data or information to third parties on the basis of outsourcing or
hosting
agreements, escrow agreements, or similar arrangements, other than by delivering
EPS Software in object code and source code together with the related user
documentation to end customers; Exhibit
7.20(a)-3 hereto
contains a true and complete description of the terms and modalities of
any EPS
Software delivered in source code to end customers. The development of
the EPS
Software has been documented properly and in-line with industry standards,
and
no employee of the Companies, and no third parties have proprietary knowledge
in
respect of the EPS Software, and its development, that would materially
impair
or delay the current and future utilization and development of the EPS
Software,
in the event that such employee or third party were not available to the
Companies. Except as set forth in Exhibit
7.20(a)-4
hereto
no former or current employee of any Company, no Main Seller, and no third
party
has any Intellectual Property right or other right in or to any part of
the EPS
Software.
(b) Exhibit
7.20(b)
hereto
identifies all Open Source Software (as defined below) that is used,
incorporated or embedded in the EPS Software. No Intellectual Property
or EPS
Software is subject to the terms of license of any Open Source Software.
For
purposes of this Agreement, “Open
Source Software”
shall
mean any software that contains, or is derived in any manner (in whole
or in
part) from, any software that is distributed as free software, open source
software (e.g., Linux) or similar licensing or distribution models, including
software licensed or distributed under any of the following licenses or
distribution models: (i) GNU’s General Public License (GPL) or Lesser/Library
GPL (LGPL); (ii) the Artistic License (e.g., PERL); (iii) the Mozilla Public
License; (iv) the Netscape Public License; (v) the Sun Community Source
License
(SCSL); (vi) the Sun Industry Standards License (SISL); (vii) the BSD License;
or (viii) the Apache License.
7.21 Information
Systems.
The
Companies own, operate and maintain state-of-the-art information systems,
including software licenses, as are required by a software company of the
Companies' size and standing, further detailed in Exhibit
7.21-1
hereto
(the "Information
Systems").
The
Companies have in place adequate information security and data protection
measures and policies (including business continuity, backup and disaster
recovery) which are, as a minimum, in compliance with the relevant local
and
international laws and standards for service providers in the financial
services
industry, including standards imposed or recommended by the payment card
industry. Except as set forth in Exhibit
7.21-2
hereto,
there have been no security incidents or material downtimes in respect
of the
Information Systems caused by internal or external factors, such as viruses,
denial-of-service-attacks or unauthorized entries in the three (3) years
prior
to the date hereof. The operation and use of the Information Systems, and
the
conduct of the Business based thereon, does not infringe and is consistent
with
all rights owned or held by any other Person (in particular software vendors),
and there is no pending or threatened claim or litigation against any of
the
Companies, Main Sellers or their respective Affiliates relating
thereto.
7.22 Intellectual
Property.
Exhibit 7.22
hereto
sets forth a complete and correct list of all Intellectual Property not
addressed in Sections 7.20
and
7.21
hereto,
together with a complete list of all licenses granted (expressly or impliedly)
by or to any of the Companies or with respect to any such Intellectual
Property
(other than licenses to any of the Companies’ customers) (the “Licenses”)
as
well as a complete and correct list of all research and development and
similar
agreements (other than any agreements with customers) to which any of the
Companies is a party or by or under which any of the Companies is bound
or
obligated (all of the above, together with the EPS Software pursuant to
Section
7.20(a)
and the
software licenses of the Information Systems pursuant to Section 7.21,
is
hereinafter referred to as the “EPS
Intellectual Property”).
Except as set forth in Exhibit 7.20
through
7.22
hereto,
(A) no item the EPS Intellectual Property infringes upon or is inconsistent
with
any rights owned or held by or licensed to, any other Person, and there
is not
and has not been in the past pending or threatened any claim or litigation
against any of the Companies, Main Sellers or their respective Affiliates
relating to any Intellectual Property or Licenses. (B) to the Main Sellers’
Knowledge, there are no facts that indicate a likelihood of any of the
foregoing, and (C) no notices have been received regarding any of the foregoing
(including, without limitation, any demands or offers to license any
Intellectual Property from any third party). Except as set forth in Exhibits 7.20
through
7.22
hereto,
no former or current employee of the Companies, and no Main Seller owns
or has
any rights in or to any item of the EPS Intellectual Property. The Intellectual
Property and the Licenses constitute all of the intellectual property and
licenses needed for the conduct of the Business as conducted on and prior
to the
date hereof, without the need for any additional expenditures for intellectual
property matters. Each item of the EPS Intellectual Property owned or used
by
the Companies immediately prior to the Initial Closing Date will be owned
or
available for use by the Companies on identical terms and conditions immediately
subsequent to the Initial Closing. Each of the Companies have taken all
necessary action to maintain and protect each item of the EPS Intellectual
Property that they own or use. To the Main Sellers' Knowledge, the owners
of any
of the EPS Intellectual Property licensed to the Companies' have taken
all
necessary and desirable actions to maintain and protect the Intellectual
Property covered by the Licenses. To
the
Main Sellers' Knowledge and to the knowledge of the directors and officers
(and employees with responsibility for Intellectual Property matters) of
the
Companies, no third party has interfered with, infringed upon, misappropriated,
or otherwise come into conflict with any item of the EPS Intellectual
Property.
7.23 Accounts
Receivable.
Except
as set forth in Exhibit 7.23
hereto,
the accounts receivable of each of the Companies as reflected in the Financial
Statements and all accounts receivable created since that date are genuine,
good, and collectible within ninety (90) days after their respective due
date,
not subject to any set-offs, counterclaims, or deductions, and represent
the
legal, valid, and binding obligation of the obligor thereof, enforceable
in
accordance with their terms. For each of the Companies, the reserves established
for doubtful accounts, any valid counterclaims, set-offs, deductions, or
allowances as reflected in the Financial Statements are adequate and in
accordance with the principal of commercial precaution (kaufmännisches
Vorsichtsprinzip).
7.24 Insurance.
Exhibit 7.24
hereto
sets forth an accurate and complete description of all policies of property,
fire and casualty, product liability, worker's compensation, and other
forms of
insurance of each of the Companies insuring the assets, operations, employees,
and risks of each of the Companies. Such policies are in full force and
effect
and no event has occurred which would give any insurance carrier a right
to
terminate any such policy. Such insurance coverage, with respect to their
amounts and types of coverage, is adequate and customary in the industry
in
order to insure against the risks associated with the Business. Except
as set
forth in Exhibit 7.24
hereto,
since December 31, 2005, there has not been any change in any of the Companies’
relationships with its insurers or in the premiums payable pursuant to
such
policies.
7.25 Subsidies.
All
public grants (Zuschüsse),
allowances, aids and other subsidies (Subventionen)
in
whatever form (the "Public
Subsidies")
received by the Companies within the period of five (5) years prior to
the date
of this Agreement are listed in Exhibit 7.25-1
hereto
and such list indicates the nature of the Public Subsidies and dates of
any
administrative orders, agreements or other instruments on which basis the
Public
Subsidies were given, the Company which received the Public Subsidies and
the
amounts received. Except as set forth in Exhibit 7.25-2
hereto,
no proceedings regarding a revocation or withdrawal of a Public Subsidy
have
been initiated or threatened, and there are no circumstances, which would
justify the initiation of such proceedings. Except as set forth in Exhibit 7.25-3
hereto,
each of the Companies is in full compliance with its obligations under
or in
connection with the Public Subsidies, including the obligations under any
ancillary provisions in the respective orders or agreements thereto. Except
as
set forth in Exhibit 7.25-4
hereto,
none of
the Companies is obliged under the Public Subsidies to maintain a certain
level
of employees or to make any investments. No Public Subsidies will have
to be
repaid in whole or in part due to the execution or consummation of this
Agreement or the transactions contemplated herein.
7.26 Absence
of Changes.
Since
December 31, 2005 through the date hereof, none of the Companies has or
will
have, except as disclosed in Exhibit 7.26
hereto
or as expressly contemplated by this Agreement:
(a) transferred,
assigned, conveyed, or liquidated into current assets any of its assets
or
business or entered into any transaction or incurred any Liability or
obligation, other than in the ordinary course of its business;
(b) suffered
any adverse change in its business, operations, or financial condition
or become
aware of any event or state of facts which may result in any such adverse
change;
(c) suffered
any destruction, damage, or loss, whether or not covered by
insurance;
(d) suffered,
permitted, or incurred the imposition of any Lien or claim upon any assets,
except for any standard retention of title clauses;
(e) committed,
suffered, permitted, or incurred any default in any Liability or
obligation;
(f) made
or
agreed to any adverse change in the terms of any Contract to which it is
a
party;
(g) waived,
canceled, sold, or otherwise disposed of, for less than the face amount
thereof,
any claim or right which it has against others;
(h) declared,
promised, or made any distribution or other payment to its shareholders
or
partners (other than reasonable compensation for services actually rendered)
or
issued any additional shares or rights, options, or calls with respect
to any
shares or other interests or participations, or redeemed, purchased, or
otherwise acquired any shares or other interests or participations, or
made any
change whatsoever in its capital structure;
(i) paid,
agreed to pay, or incurred any obligation for any payment for, any contribution
or other amount to, or with respect to, any Benefit Plans, or paid any
bonus to,
or granted any increase in the compensation of, any directors, officers,
agents,
or employees, or made any increase in the pension, retirement, or other
benefits
of its directors, officers, agents, or employees;
(j) committed,
suffered, permitted, or incurred any transaction or event which would increase
its Tax Liability for any prior taxable year;
(k) incurred
any other Liability or obligation or entered into any transaction other
than in
the ordinary course of business;
(l) received
any notices, or had reason to believe, that any supplier or customer has
taken
or contemplates any steps which could disrupt the business relationship
with
said supplier or could result in the diminution in the value of any of
the
Business as going concerns;
(m) paid,
agreed to pay, or incurred any obligation for any payment of any indebtedness
except current Liabilities incurred in the ordinary course of
business;
(n) delayed
or postponed the payment of any Liabilities, whether current or long-term,
or
failed to pay in the ordinary course of business any Liability on a timely
basis
consistent with prior practice;
(o) made
any
change in (i) any accounting, financial reporting, or tax practice or policy,
(ii) any method of calculating any bad debt, contingency, or other reserve
for
accounting, financial reporting, or tax purposes, or (iii) the fiscal
year;
(p) made
any
write-off or write-down of or any determination to write off or down any
of its
assets;
(q) made
any
change in the general pricing practices or policies or any change in the
inventory, credit, or allowance practices or policies not in the ordinary
course
of business consistent with prior practice; or
(r) made
any
amendment to the articles of association or by-laws (or other comparable
charter
documents), or resolved on any liquidation or dissolution.
7.27 Bankruptcy
or Judicial Composition Proceedings.
No
bankruptcy, insolvency or judicial composition proceedings concerning any
of the
Main Sellers or the Companies have been applied for. No circumstances exist
that
would require the application for any bankruptcy, insolvency or judicial
composition proceedings nor do any circumstances exist according to any
applicable bankruptcy or insolvency laws which would justify the avoidance
of
this Agreement.
7.28 Exhibits.
All
Exhibits attached hereto are true, correct, and complete as of the date
of this
Agreement.
7.29 Disclosure
and Relevant Information.
The
information with respect to the Companies and the Business made available
to
Purchaser prior to the date hereof was accurate in all respects and, to
the Main
Sellers’ Knowledge, constitutes all information relevant and necessary for
Purchaser’s evaluation of the Companies and the Business. To the Main Sellers’
Knowledge, this Agreement and the Exhibits hereto disclose all facts material
to
the business, assets, and operations of each of the Companies. No statement
contained herein or in any certificate, schedule, list, Exhibit, or other
instrument furnished to Purchaser pursuant to the provisions hereof contains or,
to the Main Sellers’ Knowledge, will contain any untrue statement of, or omits
or fails to state any, Material fact or any fact or circumstance, relevant
for
Purchaser’s decision to enter into this Agreement. Other than the information
provided in this Agreement and the exhibits thereto, no knowledge of Purchaser,
its Affiliates or advisers, whether obtained by way of disclosure by Main
Sellers or otherwise, shall in any way restrict or qualify the representations
and warranties of the Main Sellers under this Agreement or any remedy of
Purchaser in connection therewith.
ARTICLE
VIII
REPRESENTATIONS
AND WARRANTIES OF PURCHASER
Purchaser
hereby represents and warrants to the Main Sellers, in the form of an
independent guarantee (selbständiges
Garantieversprechen pursuant
to Section 311 BGB) that as of the date hereof and as of the Initial Closing
Date:
8.1 Organization;
Corporate Power and Authority.
Purchaser is duly organized and existing under the laws of the Federal
Republic
of Germany. Purchaser has duly authorized, executed, and delivered this
Agreement and has full power and authority to execute, deliver, and perform
its
obligations under this Agreement and the other agreements, documents, and
instruments contemplated herein without the necessity of any act or consent
of
any other Person whomsoever. This Agreement and the other agreements, documents,
and instruments contemplated herein, when executed and delivered by all
Parties
hereto, constitute the valid and binding obligation of Purchaser, enforceable
in
accordance with their terms.
8.2 Conflicts.
Neither
the execution nor the delivery of this Agreement or the other agreements,
documents, and instruments contemplated herein by Purchaser, nor the performance
of any of its obligations hereunder or thereunder, will violate or conflict
with
any of the terms of any articles of association or other organizational
documents of Purchaser.
8.3 Governmental
Approvals.
No
approval, consent, decree, or order of any governmental authority is required
in
connection with the execution and delivery of this Agreement by Purchaser,
the
performance of its obligations hereunder, or the consummation by it of
the
transactions contemplated hereby.
8.4 Third
Person Consents.
No
Third Person Consent is required in connection with the execution, delivery,
or
performance of this Agreement or the other agreements or documents contemplated
herein by Purchaser.
ARTICLE
IX
CERTAIN
COVENANTS
9.1 Maintenance
of Business.
For the
period from the date hereof through the Initial Closing Date, the Main
Sellers
shall, to the extent feasible, cause the Companies to carry on the Business
substantially in the manner heretofore conducted by the Companies and will,
to
the extent feasible, cause the Companies to use reasonable efforts to keep
available to the Business the services of the Companies’ employees and to
maintain the relationships as of such date between the Companies and their
respective suppliers, customers, and others having business relations with
them.
The Main Sellers shall, and shall, to the extent feasible, cause the Companies
to, cooperate with Purchaser in connection with the smooth transition of
the
Business to Purchaser. In particular, the Main Sellers shall cause the
Companies
not to do any of the following without the Purchaser's advance written
approval:
(a) enter
into any Material Contracts or commence any negotiations with any third
party
that would inhibit or impair the consummation of the transactions contemplated
by this Agreement;
(b) do
anything outside the ordinary course of the Business;
(c) make
any
change in the terms of employment of any director, officer or Employee
or in the
number of directors, officers or Employees of any of the Companies other
than in
accordance with existing agreements or collective bargaining
arrangements;
(d) issue
or
create any obligation to issue any shares or equity-linked securities in
the
Companies;
(e) purchase,
sell, encumber or transfer any assets outside of the ordinary course of
the
Business;
(f) enter
into any transactions related to financing, including, but not limited
to,
re-financing and forgiveness of debt;
(g) amend
any
of the constituent documents of the Companies;
(h) write-off
any account receivable, except write-offs in the ordinary course of
business;
(i) distribute
dividends
(j) (i)
make
or change any election, change an annual accounting period, (ii) adopt
or change
any accounting method, (iii) file any amended Tax Return, enter into any
closing
agreement, (iv) settle any Tax claim or assessment relating to any of the
Companies, (v) surrender any right to claim a refund of Taxes, (vi) consent
to
any extension or waiver of the limitation period applicable to any Tax
claim or
assessment relating to any of the Companies, or (vi) take any other similar
action relating to the filing of any Tax Return or the payment of any Tax,
if
such election, adoption, change, amendment, agreement, settlement, surrender,
consent or other action would have the effect of increasing the Tax Liability
of
the any of Companies for any period ending after the Initial Closing Date
or
decreasing any Tax attribute of any of the Companies existing on the Initial
Closing Date.
9.2 Non-Competition.
(a) For
a
period of three years following the Initial Closing Date, the Main Sellers
shall
not, directly or indirectly, including through any of their
respective Affiliates, conduct any activity that would compete with the
Business of the Companies in any of the countries in which such business
operations or the Business are presently conducted, including establishing
or
acquiring any business that would compete with the business operations
of the
Companies or the Business.
(b) For
a
period of three years following the Initial Closing Date, the Principals
shall
not, directly or indirectly, including through any of their
respective Affiliates, conduct any activity that would compete with the
Business of the Companies in any of the countries in which such business
operations or the Business are presently conducted, including establishing
or
acquiring any business that would compete with the business operations
of the
Companies or the Business.
9.3 Non-Solicitation.
(a) The
Main
Sellers undertake, for a period of three years from the Initial Closing
Date,
not to, and to cause its Affiliates not to, without the prior written consent
of
Purchaser, solicit any employee now or in the future employed by Purchaser,
the
Companies or their Affiliates to work in any way whatsoever for Main Sellers
or
any of their respective Affiliates.
(b) The
Principals undertake, for a period of three years from the Initial Closing
Date
not to, and to cause its Affiliates not to, without the prior written consent
of
Purchaser, solicit any employee now or in the future employed by Purchaser,
the
Companies or their Affiliates to work in any way whatsoever for Main Sellers
or
any of their respective Affiliates.
9.4 Tax-Sharing
Agreements.
All
Tax-sharing agreements or similar agreements with respect to or involving
the
Companies shall be terminated as of the Initial Closing Date and, after
the
Initial Closing Date, none of the Companies shall be bound thereby or have
any
Liability thereunder.
9.5 Termination
of Shareholders’ Agreement.
The
shareholders’ agreement dated June 15, 2001, originally entered into by and
among EPS, Xxxxxxx Xxxxxxx, Xxxxx Xxxxxxx Xxxxxx, Xxxxxxx Xxxxx, Xxxxxxxx
Xxxxx
Xxxxxx, Xxxx Xxxxx, Principal 2, Preipo, Xxxxxxxxxxx Xxxxxxxxx, Xxxxxxx
Xxxxxx
and Xxxxxxx Xxxxxx (the “Shareholders’
Agreement”)
is
hereby terminated by EPS , Preipo
and
Principal 2; EPS, the Main Sellers and Principal 2 are aware that the remaining
parties to the Shareholders' Agreement have provided termination declarations
to
the same effect and EPS, the Main Sellers and Principal 2 hereby waive
the
delivery (Zugang)
of such
declarations.
9.6 Receipt
and Distribution of Secondary Sellers’ Purchase Price.
EPS agrees
to
serve as fiduciary of the Secondary Sellers in respect of the purchase
price payments of Purchaser under the Secondary Share Purchase Agreements
to be
received on an
account of EPS to be designated by EPS in writing at least 5 days prior to
the Initial Closing Date.
EPS
shall distribute the amounts received from Purchaser on such account to the
Secondary Sellers without undue delay.
ARTICLE
X
MUTUAL
COVENANTS
10.1 Confidentiality.
(a) The
Parties understand and agree that all Proprietary Information shall be
treated
as confidential. The receiving Party shall use the same degree of care
as it
uses with regard to its own proprietary information to prevent disclosure,
use,
or publication of the disclosing Party’s or its Affiliates’ Proprietary
Information. Proprietary Information of the originating Party or its Affiliates
shall be held confidential by the receiving Party unless it is or has
been:
(i) obtained
legally and freely from a third Person without restriction as to the disclosure
of such information;
(ii) independently
developed by the receiving Party or its Affiliates at a prior time or in
a
separate and distinct manner without benefit of any of the Proprietary
Information of the disclosing Party or its Affiliates, and documented to
be as
such;
(iii) made
available by the disclosing Party or its Affiliates for general release
independent of the receiving Party or its Affiliates;
(iv) made
public as required by applicable Laws, court proceedings, or stock exchange
regulations; or
(v) within
the public domain or later becomes part of the public domain as a result
of acts
by someone other than the receiving Party or its Affiliates and through
no fault
or wrongful act of the receiving Party or its Affiliates.
The
exceptions set forth in Section 10.1(a)(i) and (ii) shall not apply with
respect
to Proprietary Information in connection with or related to the Companies
or the
Business that has been obtained or developed by any of the Main Sellers’
Affiliates.
(b) A
receiving Party may disclose Proprietary Information of a disclosing Party
or
its Affiliates to directors, officers, employees and agents of the receiving
Party, including their respective brokers, lenders, insurance carriers,
or
prospective purchasers who have specifically agreed in writing to nondisclosure
in accordance with the terms and conditions hereof. Any disclosure of
Proprietary Information required by legal process shall only be made after
providing the disclosing Party with notice thereof in order to permit the
disclosing Party to seek an appropriate protective order or exemption.
Violation
by a Party or its Affiliates or agents of the foregoing provisions shall
entitle
the disclosing Party or its Affiliates, at its option, to obtain injunctive
relief without showing of irreparable harm or injury and without bond.
The
provisions of this Section 10.1(b) will be effective for a period of ten
years
after the date hereof.
(c) For
purposes hereof, “Proprietary
Information”
shall
mean information relating to the Business, the Companies, Purchaser and
their
respective Affiliates; including (i) organizational, technical, financial,
marketing, operational, regulatory, sales and services information, (ii)
data
and information regarding methods of operation, price lists, customer lists,
technology, designs, intellectual property, specifications, or other proprietary
information of the business or affairs of Main Sellers or Purchaser and
their
respective Affiliates, or (iii) any information communicated, created,
transferred, recorded, or employed as part of, or otherwise resulting from
the
activities undertaken in connection with the negotiation, conclusion or
consummation of this Agreement and the exhibits hereto. For purposes of
this
Section 10.1(c), the Companies shall be deemed to be Affiliates of Purchaser,
and, in connection with all Proprietary Information owned or held by or
relating
to the Companies, Main Sellers shall be treated as a receiving
Party.
10.2 Public
Announcements.
Each
Party undertakes that it will not make an announcement in connection with
the
transaction contemplated by this Agreement, unless (i), if required by
applicable Law or stock exchange regulations with simultaneous notification
of
the respective other Party, or (ii) the other Party has given its respective
written consent to such announcement, including the form of such announcement,
which consent may not be unreasonably withheld and may be subject to conditions.
10.3 Further
Assurances.
Subject
to the terms and conditions provided herein, each of the Parties agrees
to use
all reasonable efforts to take, or cause to be taken, all actions and to
do, or
cause to be done, all things necessary to consummate and make effective
as
promptly as practicable the transactions contemplated hereby and to cooperate
with each other in connection with the foregoing.
10.4 Access
and Information.
Purchaser and Main Sellers shall provide each other with such assistance,
and
make employees available on a mutually convenient basis to provide additional
information, as may reasonably be requested by either one of them in connection
with the preparation of any Tax Return, Tax audit, or other Tax-related
investigation or dispute by or with any Governmental Authority and shall
provide
the other with copies of any records or information which may be relevant
to
such investigation or dispute.
10.5 Corporation
on Tax Matters
(a) The
Parties shall and EPS shall cause the Subsidiaries to cooperate fully,
as and to
the extent reasonably requested by a Party, in connection with the filing
of Tax
returns and any audit, litigation or other proceeding with respect to Taxes.
Such cooperation shall include the retention and (upon the a Party's request)
the provision of records and information that are reasonably relevant to
any
such audit, litigation or other proceeding and making employees available
on a
mutually convenient basis to provide additional information and explanation
of
any material provided hereunder. The Parties agree and EPS shall cause
the
Subsidiaries (i) to retain all books and records with respect to Tax matters
pertinent to the Companies relating to any taxable period beginning before
the
Initial Closing Date until the expiration of the statute of limitations
(and, to
the extent notified by Purchaser or Main Sellers, any extensions thereof)
of the
respective taxable periods, and to abide by all record retention agreements
entered into with any taxing authority, and (ii) to give the other Parties
reasonable written notice prior to transferring, destroying or discarding
any
such books and records and, if the other any of the other Parties requests,
EPS
or Main Sellers, as the case may be, shall and EPS shall cause the subsidiaries
to allow the other Parties to take possession of such books and
records.
(b) Purchaser
and Main Sellers further agree, upon request, to use their best efforts
to
obtain any certificate or other document from any governmental authority
or any
other Person as may be necessary to mitigate, reduce or eliminate any Tax
that
could be imposed (including, but not limited to, with respect to the
transactions contemplated hereby).
ARTICLE
XI
SALE
AND TRANSFER OF REMAINING SHARES
11.1 The
Main
Sellers and the Principals shall be obligated to cause the sale and transfer
of
all of the Shares held by those shareholders (the “Remaining
Shareholders”)
marked
with an asterisk on Exhibit
B
hereto
(the “Remaining
Shares”)
to
Purchaser, including any rights to retained earnings or to receive dividends
or
other distributions, to Purchaser to be sold and transferred to Purchaser
on the
Subsequent Closing Date, and Purchaser shall accept such sales and transfers
and
assignments. on the Subsequent Closing Date.
11.2 Subsequent
Closing.
The
closing of the sale and transfer of the Remaining Shares provided for herein
(the “Subsequent
Closing”)
shall
take place on October 31, 2006 (the “Subsequent
Closing Date”)
at
10.00 a.m. at the offices of Xxxxx Day, Xxxxxxxxxxxx 000, 00000 Xxxxxxxxx or at
any time and place mutually agreed by the Principals and Purchaser. The
Principals shall procure that at the Subsequent Closing,
(a) The
Remaining Shareholders and Purchaser shall execute sale and transfer agreements
relating to the sale and transfer and assignment of the Remaining Shares
substantially in the form set forth in Exhibit
5.1 hereto,
providing for a cash purchase price of EUR 25.94 per
share; and
(b) Purchaser
shall pay the respective purchase price to the Remaining
Shareholders.
11.3 Consent
to Transfer and Assignment of Remaining
Shares.
EPS
hereby consents to the transfer and assignment of the Remaining Shares
to
Purchaser.
11.4 Entry
into Share Register.
Immediately after the transfer and assignment of the Remaining Shares to
Purchaser hereof, EPS shall delete the Remaining Shareholders from, and
enter
Purchaser as new owner of all Remaining Shares in, the share register
(Aktienregister)
of EPS
in accordance with Section 67 para. 3 AktG.
ARTICLE
XII
INDEMNIFICATION
12.1 Indemnification
by the Main Sellers.
(a) The
Main
Sellers shall jointly and severally defend, indemnify, and hold harmless
Purchaser and its Affiliates (including the Companies) from and against
any
Losses (including Losses of the Companies), including interest thereon,
caused
by, arising out of or relating to (i) any failure by any Main Seller to
fully
perform their respective covenants and obligations as set forth herein
or in any
instrument or agreement delivered by any Main Seller pursuant hereto
(“Main
Sellers’ Covenants”),
(ii)
any breach by any Main Seller of or any inaccuracy in any representation
or
warranty to Purchaser contained in ARTICLE VII of this Agreement, or (iii)
any
Taxes or of the Companies relating to periods or arising prior to the Initial
Closing, except to the extent such Taxes have been fully accrued for in
the
Financial Statements.
(b) In
addition, the Main Sellers shall jointly and severally defend, indemnify,
and
hold harmless Purchaser and its Affiliates (including the Companies) from
and
against any Losses (including Losses of the Companies), including interest
thereon, caused by or arising out of or in connection with any of the
following:
(i) the
non-purchase of the TCP/IP ATM platform for a residual value of EUR 746,574.40
plus VAT by Commerzbank AG under the sub-lease agreement between Commerzbank
AG
and EPS and the resulting lack of coverage of EPS’ residual payment obligation
vis-à-vis CommerzLeasing Mobilien GmbH in the same amount;
(ii) any
Taxes
payable by any of the Companies as a result of any persons have been or
will by
operation of law be deemed to be, employees of any of the Companies;
and
(iii) any
failure on the part of the Principals or the Main Sellers to comply with
their
respective obligations to effect the sale and transfer of the Remaining
Shares
on the Subsequent Closing Date pursuant to ARTICLE XI of this
Agreement.
(c) If
as a
result of a failure on the part of the Principals or the Main Sellers to
comply
with their respective obligations to effect the sale and transfer of the
Remaining Shares under ARTICLE XI of this Agreement, Purchaser will on
the
Subsequent Closing Date have not received ownership in all of the Remaining
Shares, the Main Sellers agree to indemnify Purchaser on a Euro-for-Euro
basis
(i) for any additional consideration and related costs incurred by Purchaser
or
the Companies in order to purchase such Remaining Shares that have not
been
transferred as well as (ii) for all Losses incurred in connection with
formal or
informal contest or opposition proceedings or actions by such Remaining
Shareholders. Further, if as a result of a failure on the part of the Principals
or the Main Sellers to comply with their respective obligations to effect
the
sale and transfer of the Remaining Shares under ARTICLE XI of this Agreement,
Purchaser will on the Subsequent Closing Date have received an aggregate
of less
than 95% of the Shares, the Main Sellers agree to indemnify Purchaser in
a
liquidated damage amount equal to 150% of the
aggregate value of the Remaining Shares that have not been transferred
as
determined by Purchaser in its reasonable discretion; the entitlement to
liquidated damages pursuant to this second sentence of Section
12.1(c)
does not preclude Purchaser from asserting any additional indemnification
claims
under the second sentence of this Section 12.1(c) and Section 12.1(b)(iii)
hereof.
12.2 Indemnification
by Purchaser.
Purchaser shall defend, indemnify, and hold harmless the Main Sellers from
and
against any Losses, including interest thereon, caused by, arising out
of or
relating to (a) any failure by Purchaser to fully perform its covenants
and
obligations as set forth herein (“Purchaser’s
Covenants”)
or in
any instrument or agreement delivered by Purchaser pursuant hereto, or
(b) any
breach by Purchaser of any inaccuracy in any representation or warranty
to the
Main Sellers contained in ARTICLE VIII of this Agreement.
12.3 Indemnification
Procedure.
(a) Each
Indemnified Party agrees to give the Indemnifying Party prompt (unverzüglich)
written
notice of any written claim by a third Person, of which it obtains knowledge,
which will give rise to any Losses which are required to be indemnified
against
under this Agreement. Such written notice, without prejudice to additional
claims, shall set forth the basis on which a claim for indemnity hereunder
is
requested and, in the case of claims by a third Person, shall advise the
Indemnifying Party whether the Indemnified Party intends to contest same.
The
Indemnified Party shall have the right to contest such claim, in which
case the
Indemnifying Party, to the extent legally possible, shall have the right
to be
represented, at its own expense, by its own counsel, its participation
to be
subject to the reasonable direction of the Indemnified Party.
(b) If
the
Indemnified Party determines not to contest such claim, the Indemnifying
Party
shall have the right, at its own expense, to contest and defend against
such
claim on behalf of and in the name of the Indemnified Party by giving written
notice to the Indemnified Party within fifteen days after the receipt of
the
Indemnified Party's notice that it intends not to contest. If the Indemnifying
Party determines to contest such claim, the Indemnified Party shall have
the
right to be represented, at its own expense, by its own counsel, its
participation to be subject to the reasonable direction of the Indemnifying
Party and the Indemnifying Party's choice of counsel shall be subject to
the
prior written approval of the Indemnified Party. If the Indemnifying Party
determines to contest such claim, it shall be deemed to have agreed that
such
claim is fully subject to indemnification hereunder. If the Indemnifying
Party
subsequently determines to settle such claim, such settlement shall be
subject
to Section 12.3(d) of this Agreement. If the Indemnifying Party fails to
undertake the defense of or settle or pay any such third Person claim within
30
days after the Indemnified Party has given written notice to the Indemnifying
Party advising that the Indemnified Party does not intend to contest such
claim,
or if the Indemnifying Party, after having given notice to the Indemnified
Party
that it intends to contest such claim, fails promptly or thoroughly to
defend,
settle, or pay such claim, then the Indemnified Party may take any and
all
action to dispose of such claim, including the settlement or full payment
thereof (in each case without being obligated under the provisions of Section
12.3(d) hereof as a Settling Party) upon such terms as it shall deem
appropriate, in its sole discretion, and the Indemnifying Party shall be
liable
to pay, upon demand, to the Indemnified Party the full amount of the indemnity
claim therefor.
(c) In
any
case, each Party shall make available to the other and its attorneys at
all
reasonable times during normal business hours, all books, records, and
other
documents in its possession relating to such claim and the Party contesting
any
such claim shall be furnished all reasonable assistance in connection therewith
by the other Party or Parties.
(d) In
the
event that a Party (the “Settling
Party”)
desires to settle any third Person claim, the Settling Party shall advise
the
Indemnifying Party or the Indemnified Party, as the case may be, in writing
of
the terms of the proposed settlement. If such proposed settlement is
unsatisfactory to such Indemnifying Party or Indemnified Party, as the
case may
be, such Indemnifying Party or Indemnified Party, as the case may be, shall
have
the right, at the Indemnifying Party's expense, to contest such claim by
giving
written notice of such election to the Settling Party within 30 days of
the
Indemnifying Party's or Indemnified Party's, as the case may be, receipt
of the
advice of the proposed settlement. If such Indemnifying Party or Indemnified
Party, as the case may be, delivers no such written notice within such
30 days,
the Settling Party may offer the proposed settlement to the third Person
making
such claim. If the proposed settlement is not accepted by the third Person
making such claim, any new proposed settlement which the Settling Party
may wish
to present to the third Person making such claim shall again be subject
to the
provisions of this subparagraph. Any settlement proposed by Main Sellers
shall
contain an unconditional release of Purchaser and its Affiliates from such
claim
and shall not involve any non-monetary relief effecting Purchaser or any
of its
Affiliates or any of their businesses as then conducted or proposed to
be
conducted.
(e) At
the
time the amount of any Liability on the part of an Indemnifying Party under
this
Section 12.3 is determined (which in case of payments to a third Person
shall be the earlier of (i) the date of such payment, or (ii) the date
that a
court of competent jurisdiction shall enter a judgment, order, or decree
establishing such Liability, and in the case of payment of any Taxes, shall
be
the date such Taxes are agreed with or ordered to be paid by the relevant
taxing
authority), the Indemnifying Party shall forthwith, upon notice to the
Indemnified Party, pay to the Indemnified Party the amount of the claim
for
indemnification.
12.4 Limitation
on Liability of Main Sellers.
The
joint
and several liability of the Main Sellers and the recourse of Purchaser
shall be
limited to (i) any amounts held in the Escrow Account, and (ii)
any forfeitable portion of the Stock Consideration
serving
as security in accordance with ARTICLE IV hereof.
12.5 Expiration
Date.
Any
claims of Purchaser under the representations and warranties contained
in
ARTICLE VII hereof shall expire (verjähren)
3 years
after the date hereof; provided,
however,
that
(i) any claims of Purchaser under the representations and warranties contained
in Sections 7.1, 7.2, 7.3, 7.4, 7.5, 7.16, 7.20(a), 7.21, 7.22 and 7.29
hereof
and any claims of the Main Sellers contained in ARTICLE VIII hereof shall
expire
(verjähren)
30
years after the date hereof, (ii) any Liabilities of any Party relating
to its
Covenants shall expire (verjähren)
30
years after the date hereof, and (iii) any claims of Purchaser under the
representations and warranties contained in Section 7.16 of this Agreement
shall
expire (verjähren)
for
each relevant Tax period six months after the assessment covering the respective
Tax period has become final and non-appealable.
ARTICLE
XIII
REPRESENTATIONS
OF PRINCIPALS
The
Principals hereby jointly and severally represent and warrant to Purchaser
that
to their knowledge, the representations and warranties of the Main Sellers
made
in ARTICLE VII hereof are true and correct as of the date hereof and the
Initial
Closing Date.
ARTICLE
XIV
MISCELLANEOUS
14.1 Notice.
Except
as otherwise provided herein, any notice required hereunder shall be in
writing,
and shall be deemed to have been validly served, given, or delivered upon
delivery thereof to the Party to be notified (in the case of a fax, by
delivery
via telefax with confirmation of receipt), in each case to the address
of the
party to be notified, as follows:
(a) If
to
Purchaser:
Transaction
Systems Architects, Inc
000
Xxxxx
000xx
Xxxxxx
Xxxxx,
Xxxxxxxx 00000,
U.S.A
Attention:
General Counsel
Telephone: x0
000
000 0000
Telefax: x0
000
000 0000.
with
copy
to:
Xxxxx
Day
Frankfurt
Xxxxxxxxxxxx
000
00000
Xxxxxxxxx xx Xxxx
Xxxxxxx
Attention:
Partner-in-Charge
Telephone: x00-00-00000000
Telefax: +49
-89-97263993
(b) If
to
Preipo:
Preipo
Beratungs- und Beteiligungsgesellschaft
Xxxxxxxxxxx.
0
X-00000
Xxxxxxxxxxxxx
Attention:
Managing Director
Telephone: x00-0000-000000
Telefax: x00-0000-000000
(c) If
to
RP:
RP
Vermögensverwaltung GmbH
Am
Heegwald 12
D-61381
Friedrichsdorf
Attention:
Managing Director
Telephone: x00
0000
000000
Telefax: x00
0000
000000
(d) If
to
EPS
eps
Electronic Payment Systems AG
Am
Limespark 2
D-658843
Xxxxxxxx
Attention:
Management Board
Telephone: x00
(0)0000 0000-00
Telefax: x00
(0)0000 0000-00
(e) If
to
Principal 1
Xxxxxxxxx
Xxxxx
Xxxxxxxxxxx.
0
X-00000
Xxxxxxxxxxxxx
Telephone: x00-0000-000000
Telefax: x00-0000-000000
(f) If
to
Principal 2
Johann
Praschinger
Am
Heegwald 12
X-00000
Xxxxxxxxxxxxxx
Telephone: x00
0000
000000
Telefax: +49
0000
000000
00.2 Assignment.
No
Party shall assign or delegate this Agreement or any rights or obligations
hereunder to any person without the prior written consent of the other
Parties
hereto; provided,
however,
that
Purchaser may assign any of its rights under this Agreement to any Affiliate
of
Purchaser without the prior consent of any other Party.
14.3 Taxes
and Fees.
Purchaser shall be jointly and severally liable for and pay all applicable
sales, documentary, recording, filing, transfer, and other similar Taxes
and
fees (including notary fees) payable as a result of the consummation of
the
transactions contemplated hereby, and Purchaser will, at its own expense,
file
all necessary Tax Returns and other documentation with respect to all such
Taxes, fees and charges, and, if required by applicable law, the Main Sellers
will, and will cause their respective Affiliates to, join in the execution
of
any such Tax Returns and other documentation. Apart therefrom, unless otherwise
provided herein, each Party shall bear its own costs and the costs of its
advisers and auditors.
14.4 Amendments.
Save
where the law provides for another form, this Agreement may be amended
or
supplemented or the performance of a provision hereof waived only by an
instrument in writing executed, notarized, if legally required, and delivered
by
a duly authorized director or officer or attorney-in-fact of each of the
Parties, including for any amendment to this provision.
14.5 Successors
and Assigns.
This
Agreement shall be binding upon, inure to the benefit of, and may be enforced
by, the Parties and their respective successors and permitted
assigns.
14.6 Governing
Language.
This
English language version of this Agreement shall be in all respects controlling
despite the existence of any translation hereof; provided,
however,
that,
where a German term in italics is appended in this English language version
to
an English term or otherwise used, such German term (and not the English
term to
which it relates) shall be authoritative for the purpose of interpretation
of
the relevant English term in this Agreement.
14.7 Conflicts.
If and
to the extent a conflict arises between the contents of this Agreement
and any
document or agreement entered into in connection with this Agreement, the
terms
of this Agreement shall prevail.
14.8 Choice
of Law.
The
validity, interpretation, and performance of this Agreement and any dispute
connected herewith shall be exclusively governed and construed in accordance
with the laws of the Federal Republic of Germany without giving effect
to its
conflict of law provisions.
14.9 Dispute
Resolution.
All
disputes arising out of or in connection with this Agreement shall be finally
settled by arbitration under the Rules of Arbitration of the International
Chamber of Commerce (the “ICC
Rules”)
by
three arbitrators appointed in accordance with the ICC Rules in effect
at the
time of application. The language of the arbitral proceedings shall be
English.
The place of arbitration shall be Frankfurt, Federal Republic of
Germany.
14.10 Entire
Agreement.
This
Agreement, including all Exhibits hereto, constitutes the full understanding
of
the Parties and the complete and exclusive statement of the terms and conditions
of the Agreement relating to the subject matter hereof and supersedes any
and
all prior agreements, whether written or oral, that may exist between the
Parties with respect thereto.
14.11 Severability.
In the
event that any provision of this Agreement shall finally be determined
by a
competent tribunal or court to be unlawful or unenforceable, such provision
shall be deemed severed from this Agreement, but every other provision
of this
Agreement shall remain in full force and effect, and the Parties shall
agree to
replace the unlawful or unenforceable provision by a provision of similar
meaning reflecting the original intent of the Parties to the extent permissible
under applicable laws. In the event, the Parties inadvertently did not
address
certain issues in this Agreement which subsequently become relevant
(Vertragslücke),
the
unaddressed issue shall be handled so as to give effect to the extent possible
to the intentions of the Parties as reflected in this Agreement.
[Signature
Pages Follow]
TRANSACTION
SYSTEMS ARCHITECTS, INC.
By: /s/
Xxxxxx Xxxxxx
Name:
Xxxxxx Xxxxxx
Title:
Senior Vice President
PREIPO
BERATUNGS- UND BETEILIGUNGSGESELLSCHAFT MBH
By: /s/
Xxxx Xxxxx
Name:
Xxxx Xxxxx
Title:
Managing Direcor
XXXXXXXXX
XXXXX
Xxxxxxxxxxx.
0
X-00000
Xxxxxxxxxxxxx
/s/
Xxxxxxxxx Xxxxx
RP
VERMOGENSVERWALTUNG
GMBH
By: /s/
Xxxxxx Rimmle-Praschinger
Name:
Xxxxxx Rimmle-Praschinger
Title:
Managing Director
JOHANN
PRASCHINGER
Am
Heegwald 12
D-61381
Friedrichsdorf
/s/
Johann Praschinger
EPS
ELECTRONIC PAYMENT SYSTEMS AG
By: /s/
Xxxxxxxxx Xxxxx
Name:
Xxxxxxxxx Xxxxx
Title:
Member of Management Board
By: /s/
Johann Praschinger
Name:
Johann Praschinger
Title:
Member of Management Board
SHARE
PURCHASE AGREEMENT EXHIBIT LIST
Exhibit
A Defined
Terms
Exhibit
B Shareholder
and Share Ownership Listing
Document
Exhibits
Exhibit
3.2 Form
of
Restricted Stock Agreements for Main Sellers
Exhibit
4.4 Form
of
Escrow Agreement
Exhibit
5.1 Form
of
Secondary Share Purchase Agreement
Exhibit
5.4 Form
of
Supervisory Board Member Resignation
Exhibit
5.8 Form
of
Contractor and Freelancer Acknowledgement
Disclosure
Exhibits
Exhibit
7.1 Organization
- Articles of Association
Exhibit
7.2(c)-1 Capitalization
- No Other Securities
Exhibit
7.2(c)-2 Capitalization
- No Other Rights Associated with Securities
Exhibit
7.5 Third
Person Consents
Exhibit
7.6-1 Tangible
Assets - No Liens
Exhibit
7.6-2 Tangible
Assets - Ownership
Exhibit
7.7-1 Real
Property - Owned and Leased
Exhibit
7.7-2 Real
Property - Company Lessor or Sublessor
Exhibit
7.8(a)-1 Contracts
- Material Contracts
Exhibit
7.8(a)-2 Contracts
- No Breach
Exhibit
7.8(a)-3 Contracts
- Contracts with Affiliates
Exhibit
7.8(b) Contracts
- Specified Types
Exhibit
7.8(c) Contracts
- Material Pending Negotiations
Exhibit
7.8(d)
Contracts
- No Warranty Claims
Exhibit
7.8(e)
Contracts
- Material Customers and Suppliers
Exhibit
7.8(f)
Contracts
- Prior Damage Claims
Exhibit
7.9(a)
Financial
Statements - Annual Financial Statements
Exhibit
7.9(b)
Financial
Statements - Affiliate Transactions
Exhibit
7.9(c)
Financial
Statements - Bring Down
Exhibit
7.10(a)
Liabilities
- Accrued and Unaccrued Liabilities and No Default
Exhibit
7.10(b)
Liabilities
- No Undisclosed Loans
Exhibit
7.13
Permits
Exhibit
7.14(a)-1 Employee
Matters - List of Employees
Exhibit
7.14(a)-2 Employee
Matters - Standard Employment Agreements
Exhibit
7.14(a)-3 Employee
Matters - Oral Employment Arrangements
Exhibit
7.14(a)-4 Employee
Matters - Material Deviations from Standard Agreements
Exhibit
7.14(c) Employee
Matters - No Employee Disputes
Exhibit
7.14(e)-1 Employee
Matters - Current and Former Employees Not Listed
Exhibit
7.15-1
Benefit
Plans - List of Plans
Exhibit
7.15-2
Benefit
Plans - No Benefit Plan Liabilities
Exhibit
7.16(a) Taxes
-
Tax Basis
Exhibit
7.16(b)
Taxes
-
Tax Liabilities
Exhibit
7.19
Bank
Accounts
Exhibit
7.20(a)-1 EPS
Software - Description
Exhibit
7.20(a)-2 EPS
Software - Ownership
Exhibit
7.20(a)-3 EPS
Software - Source Code Release
Exhibit
7.20(b)
EPS
Software - Open Source Software
Exhibit
7.21-1 Information
Systems - Equipment and Systems
Exhibit
7.21-2 Information
Systems - No Security Incidents
Exhibit
7.22 Intellectual
Property
Exhibit
7.23
Accounts
Receivable
Exhibit
7.24
Insurance
Exhibit
7.25-1
Public
Subsidies - Grants and Subsidies
Exhibit
7.25-2
Public
Subsidies - No Proceedings
Exhibit
7.25-3
Public
Subsidies - Compliance
Exhibit
7.25-4
Public
Subsidies - Requirements
Exhibit
7.26
Absence
of Changes
EXHIBIT
A
DEFINED
TERMS
|
Affiliates
|
shall
mean “verbundenes
Unternehmen,”
as defined in Sections 15 et
seq.
of
the AktG,
and the term “verbundenes
Unternehmen”,
shall include any Person that, directly, or indirectly through
one or more
intermediaries, Controls, is Controlled by, or is under common
Control
with, the specified Person. Unless otherwise specifically stipulated,
for
purposes of this Agreement, the Companies shall be deemed to
be Affiliates
of Main Sellers.
|
|
Agreement
|
shall
have the meaning ascribed thereto in the first sentence of this
Agreement.
|
|
AktG
|
shall
mean the German Stock Corporation Act (Aktiengesetz).
|
|
Annual
Financial Statements
|
shall
mean the audited financial statements of each of the Companies
for the
fiscal years ending December 31, 2003, December 31, 2004 and
December 31,
2005, consisting of balance sheet (Bilanz),
income statement (Gewinn-
und -Verlustrechnung),
statement of cash flow (Kapitalflussrechnung),
and the notes thereto.
|
|
Antitrust
Authorities
|
shall
mean the European Commission, the German Federal Cartel Office
(Bundeskartellamt), the United States Federal Trade Commission,
the
Antitrust Division of the United States Department of Justice,
and any
other Governmental Authority responsible for the regulation and
administration of filings in respect of Antitrust Laws.
|
|
Antitrust
Laws
|
shall
mean Council Regulation (EC) No 139/2004 on the control of concentrations
between undertakings, as amended, the German Act Against Restraints
of
Competition, as amended (Gesetz gegen Wettbewerbsbeschr’nkungen or GWB),
the United States Xxxxxxx Act, as amended, the United States
Xxxx-Xxxxx-Xxxxxx Act, as amended, the United States Federal
Trade
Commission Act, as amended,and all other Laws that are designed
or
intended to regulate competition or investment (foreign or otherwise)
or
to prohibit, restrict or regulate actions having the purpose
or effect of
restraints of trade.
|
|
Benefit
Plans
|
shall
have the meaning ascribed thereto in Section 7.15
of
this Agreement.
|
|
BGB
|
shall
mean the German Civil Code (Bürgerliches
Gesetzbuch).
|
|
Business
|
shall
have the meaning ascribed thereto in the first Preamble of this
Agreement.
|
|
Cash
Consideration
|
shall
have the meaning ascribed thereto in Section 2.1(a)
hereof.
|
|
Companies’
Leased Real Property
|
shall
have the meaning ascribed thereto in Section 7.7
of
this Agreement.
|
|
Company/Companies
|
shall
have the meaning ascribed thereto in the second Preamble of this
Agreement.
|
|
Contracts
|
shall
mean all contracts, agreements, commitments, and binding offers,
including
joint venture agreements, consulting and severance agreements,
acquisition
and disposition agreements, security agreements, agreements relating
to
borrowing or money, extension of credit, agreements granting
any Liens,
sales, agency, franchise, distribution, and other marketing agreements,
agreements with subcontractors and sub-suppliers, leases, including
leases
of real property, orders, and licenses.
|
|
Control
|
when
used with reference to a specified Person, shall mean the right
or power,
through ownership of capital stock, by contract or otherwise,
to direct
the business affairs of the specified Person.
|
|
Covenants
|
shall
mean Main Sellers’ Covenants and Purchaser’s Covenants.
|
|
EPS
|
shall
have the meaning ascribed thereto in the first sentence of this
Agreement.
|
|
Employees
|
shall
have the meaning ascribed thereto in Section 7.14
of
this Agreement.
|
|
EPS
Intellectual Property
|
shall
have the meaning ascribed thereto in Section 7.22
of
this Agreement.
|
|
EPS
Ltd.
|
shall
have the meaning ascribed thereto in the second Preamble of this
Agreement.
|
|
EPS
Prepaid
|
shall
have the meaning ascribed thereto in the second Preamble of this
Agreement.
|
|
EPS
Romania
|
shall
have the meaning ascribed thereto in the second Preamble of this
Agreement.
|
|
EPS
Software
|
shall
have the meaning ascribed thereto in Section 7.20(a)
of
this Agreement.
|
|
EPS
Switzerland
|
shall
have the meaning ascribed thereto in the second Preamble of this
Agreement.
|
|
Escrow
Account
|
shall
have the meaning ascribed thereto in Section 3.1(c)
of
this Agreement.
|
|
Escrow
Agreement
|
shall
have the meaning ascribed thereto in Section 4.4
of
this Agreement.
|
|
Escrow
Amount
|
shall
have the meaning ascribed thereto in Section 3.1(c)
of
this Agreement.
|
|
Final
Escrow Release Date
|
shall
have the meaning ascribed thereto in Section 4.3
of
this Agreement.
|
|
Financial
Statements
|
shall
mean the Annual Financial Statements.
|
|
German
GAAP
|
shall
mean the German generally accepted accounting principles.
|
|
Governmental
Authority
|
shall
mean any court, governmental (including European Commission)
authority,
governmental body, or other regulatory or administrative agency
or
commission of any government of any country or any private or
governmental
arbitration or conciliation authority or other similar body.
|
|
Hazardous
Substances
|
shall
mean shall mean any substance that is toxic, flammable, ignitable,
reactive, oxidizing, corrosive, radioactive or caustic, dangerous
substance, toxic substance, toxic pollutant, hazardous waste,
special
waste, waste legally requiring special surveillance, industrial
waste
pollutant or harmful to human health or the environment. To the
extent
applicable, the terms above shall be defined as set forth in
applicable
European directives.
|
|
ICC
Rules
|
shall
have the meaning ascribed thereto in Section 14.9
of
this Agreement.
|
|
including
|
shall
mean including without limitation.
|
|
Indemnified
Party
|
shall
mean a Party who is seeking indemnification from another Party
to this
Agreement pursuant to the terms and conditions of ARTICLE
XII
of
this Agreement.
|
|
Indemnifying
Party
|
shall
mean a Party from whom indemnification is sought by another Party
pursuant
to the terms and conditions of ARTICLE
XII
of
this Agreement.
|
|
Information
Systems
|
shall
have the meaning ascribed thereto in Section 7.21
of
this Agreement.
|
|
Initial
Closing
|
shall
have the meaning ascribed thereto in Section 6.1
of
this Agreement.
|
|
Initial
Closing Date
|
shall
have the meaning ascribed thereto in Section 6.1
of
this Agreement.
|
|
Initial
Shares
|
shall
have the meaning ascribed thereto in the sixth Preamble of
this Agreement.
|
|
Intellectual
Property
|
shall
mean all patents, registered copyrights, registered trademarks,
service
marks and registered trade names, and all registrations of or
applications
for registration of any of the foregoing, including any additions
thereto
or extensions, continuations, renewals, or divisions thereof,
processes,
trade secrets, know-how, domain names, customer and supplier
lists,
computer software, computer programs and source codes, protected
formula
and manufacturing, research and technical information, personnel
records,
sales and purchase records, marketing and advertising data and
other books
and records, and other intellectual property rights belonging
to, owned,
used, licensed, planned to be used or licensed to or by any of
the
Companies.
|
|
Law
|
shall
mean any law, statute, judgment, decree, order, rule, regulation,
ordinance, zoning regulation, legal requirement, enactment, or
Permit of
any Governmental Authority.
|
|
Liability
|
shall
mean any debt, liability or obligation of any kind whatsoever,
direct or
indirect, accrued or contingent, including any guaranty of any
debt,
liability or obligation of any other Person.
|
|
Licenses
|
shall
have the meaning ascribed thereto in Section 7.22
of
this Agreement.
|
|
Lien
|
shall
mean any lien, encroachment, easement, attachment, encumbrance,
mortgage,
business mortgage, hypothecation, or other conflicting ownership,
conflicting equity, or conflicting security interest.
|
|
Litigation
|
shall
mean any litigation, action, arbitration, suit, and any investigation,
inquiry, claim, or preceding by any Person, including any Governmental
Authority.
|
|
Loss
or Losses
|
shall
mean damages as defined in Section 249 et
seq.
of
the German Civil Code (Bürgerliches
Gesetzbuch),
and any loss, cost, Liability, claim, expense, costs of defense
or
litigation and fees and expenses of attorneys, accountants and
other
experts.
|
|
Main
Seller(s)
|
shall
have the meaning ascribed thereto in the first sentence of this
Agreement.
|
|
Main
Sellers’ Covenants
|
shall
have the meaning ascribed thereto in Section 12.1(a)
of
this Agreement.
|
|
Main
Sellers’ Knowledge
|
shall
mean the actual knowledge and constructive knowledge (i.e., could
have
known but for gross negligence (xxxxx
Fahrlässigkeit)
taking into account the standard customarily applied to a prudent
business
person (Xxxxxxxx)
in the same position) of (a) the Main Sellers, (b) the Principals,
and (c)
Xx. Xxxx Xxxxxxxx, Xx. Xxxxxxx Xxxx, Xx. Xxxxxx Wild and the professional
advisors of the Main Sellers, the Principals and EPS involved
in the
transactions contemplated by this Agreement.
|
|
Main
Sellers' Shares
| shall
have the meaning ascribed thereto in the fourth Preamble of this
Agreement. |
|
Material;
Materially
|
shall
mean any single occurrence or item or series of occurrences or
items
having an aggregate effect on Purchaser, its Affiliates or the
Companies
in an amount estimated by Purchaser to be or liquidated at more
than EUR
20,000.
|
|
Material
Contracts
|
shall
mean all agreements, Contracts, commitments and undertakings
that (i)
provide for the provision of goods or services or in an amount
exceeding
EUR 50,000 per
annum,
(ii) any other agreements with a contract value in excess of
EUR 50,000
per
annum,
or (iii) are material to the Companies and the Business in any
other
respect.
|
|
Material
Customers
|
shall
have the meaning ascribed thereto in Section 7.8(e)
of
this Agreement.
|
|
Material
Suppliers
|
shall
have the meaning ascribed thereto in Section 7.8(e)
of
this Agreement.
|
|
Open
Source Software
|
shall
have the meaning ascribed thereto in Section 7.20(b)
of
this Agreement.
|
|
Part(y/ies)
|
shall
have the meaning ascribed thereto in the second sentence of this
Agreement.
|
|
Permit
|
shall
mean any license, permit, approval, consent, business registration,
or
qualification from any Governmental Authority.
|
|
Person
|
shall
mean an individual, a corporation, a partnership, a joint stock
company, a
joint venture, an estate, a trust, an unincorporated organization,
a
Governmental Authority, or any other form of association or
entity.
|
|
Post-Closing
Tax Period
|
shall
mean any Tax period (or portion thereof) ending after the date
hereof.
|
|
Pre-Closing
Tax Period
|
shall
mean any Tax period (or portion thereof) ending on or before
the date
hereof.
|
|
Preipo
|
shall
have the meaning ascribed thereto in the first sentence of this
Agreement.
|
|
Preipo
Shares
|
shall
have the meaning ascribed in the fourth Preamble of this
Agreement.
|
|
Principal
1
|
shall
have the meaning ascribed thereto in the first sentence of this
Agreement.
|
|
Principal
2
|
shall
have the meaning ascribed thereto in the first sentence of this
Agreement.
|
|
Principals
|
shall
have the meaning ascribed thereto in the first sentence of this
Agreement.
|
|
Proprietary
Information
|
shall
have the meaning ascribed thereto in Section 10.1(b)
of
this Agreement.
|
|
Public
Subsidies
|
shall
have the meaning ascribed thereto in Section 7.25
of
this Agreement.
|
|
Purchase
Price
|
shall
have the meaning ascribed thereto in 2.1(a)
of
this Agreement.
|
|
Purchaser
|
shall
have the meaning ascribed thereto in the first sentence of this
Agreement.
|
|
Purchaser’s
Covenants
|
shall
have the meaning ascribed thereto in Section 12.2
of
this Agreement.
|
|
Remaining
Shares
|
shall
have the meaning ascribed thereto in Section 11.1
of
this Agreement.
|
|
Remaining
Shareholders
|
shall
have the meaning ascribed thereto in Section 11.1
of
this Agreement.
|
|
RP
|
shall
have the meaning ascribed thereto in the first sentence of this
Agreement.
|
|
RP
Shares
|
shall
have the meaning ascribed thereto in the fourth Preamble of
this Agreement.
|
|
Secondary
Seller(s)
|
shall
have the meaning ascribed thereto in the sixth Preamble of this
Agreement.
|
|
Secondary
Share Purchase Agreements
|
shall
have the meaning ascribed thereto in Section 5.1
of
this Agreement.
|
|
Settling
Party
|
shall
have the meaning ascribed thereto in Section 12.3(d)
of
this Agreement.
|
|
Shareholders’
Agreement
|
shall
have the meaning ascribed thereto in Section 9.5
of
this Agreement.
|
|
Shares
|
shall
have the meaning ascribed thereto in the third Preamble of this
Agreement.
|
|
Stock
Consideration
|
shall
have the meaning ascribed thereto in Section 2.1(b)
hereof.
|
|
Subsequent
Closing
|
shall
have the meaning ascribed thereto in Section 11.2
of
this Agreement.
|
|
Subsequent
Closing Date
|
shall
have the meaning ascribed thereto in Section 11.2
of
this Agreement.
|
|
Subsidiaries
|
shall
have the meaning ascribed thereto in the second Preamble of this
Agreement.
|
|
Subsidiary
Shares
|
shall
have the meaning ascribed thereto in Section 7.2(e)
of
this Agreement.
|
|
Tax
or Taxes
|
shall
mean any tax or similar assessments or charges within the meaning
of
Section 3 para 1 through 4 of the German Tax Act (Abgabenordnung)
or similar provisions under applicable foreign Laws imposed by
the
applicable tax authorities and social security contribution imposed
by any
Governmental Authority including all foreign and domestic, federal,
state,
and local income, trade, net worth, value added, excise, payroll,
employment, capital, real property, social, or other taxes or
customs or
similar taxes, duties, or charges, or social charges, interest
on tax,
late payments or late filing or report charges.
|
|
Tax
Returns
|
shall
mean all reports, estimates, declarations of estimated or self-calculated
Tax, information statements, forms, and returns relating to,
or required
to be filed in connection with, any Taxes.
|
|
Third
Person Consent
|
shall
have the meaning ascribed thereto in Section 7.5
hereof.
|
|
UmwG
|
shall
mean the German Transformation Act (Umwandlungsgesetz).
|
