EXHIBIT 10.19
ASSET PURCHASE AGREEMENT
This Asset Purchase Agreement ("Agreement") is made and entered into on
the 3rd day of March, 2004 (the "Effective Date"), by and among XXX Xxxxxxxxxxx,
a Maryland corporation, having its principal place of business at 0000 X.
Xxxxxxxxx Xxxx., Xxxxxx, Xxxx 00000 ("NCR"), NCR Canada Ltd., a Canadian
corporation, having its principal place of business at 0000 Xxxxxxx Xxxxxx,
Xxxxxxxxxxx, Xxxxxxx X0X 0X0 ("NCR Canada") NCR Limited (UK), an English
company, having its principal place of business at 000 Xxxxxxxxxx Xxxx, Xxxxxx,
Xxxxxxx XX0 0XX ("NCR UK"), (NCR, NCR Canada and NCR UK being collectively
referred to herein as "Buyer"), and Optimal Robotics Corp., a Canadian
corporation, having its principal place of business at 0000 xx xx Xxxxxx, Xxxxx
000, Xxxxxxxx, Xxxxxx X0X 0X0 ("Optimal Corp."), Optimal Robotics Inc., a
Delaware corporation, having a mailing address at 0000 xx xx Xxxxxx, Xxxxx 000,
Xxxxxxxx, Xxxxxx X0X 0X0 ("Optimal Inc.") and Optimal Robotics Plc., an English
company, having its mailing address at 0000 xx xx Xxxxxx, Xxxxx 000, Xxxxxxxx,
Xxxxxx X0X 0X0 ("Optimal Plc.") (Optimal Corp., Optimal Inc. and Optimal Plc.
being collectively referred to herein as "Seller"). Capitalized terms not
defined in the context of this Agreement shall have the meanings specified in
Section 31.
RECITALS:
A. Seller carries on the business of manufacturing, assembling,
marketing, selling and servicing self-checkout systems (the
"Business"); and
B. Seller has agreed to sell to Buyer and Buyer has agreed to purchase
from Seller all of the assets of Seller needed to operate the
Business as currently operated by Seller, on the terms and
conditions of this Agreement.
NOW, THEREFORE, in consideration of the premises above and of the mutual
covenants, representations, warranties and agreements set forth herein, the
parties hereby agree as follows:
AGREEMENT
1. Purchase and Sale of Purchased Assets. Subject to the terms and
conditions of this Agreement, except for the Excluded Assets, on the
Closing Date, Seller shall sell, assign, transfer, convey, and
deliver to Buyer, and Buyer shall purchase from Seller, all of
Seller's right, title and interest in and to the following property,
undertakings and assets needed to operate the Business
(collectively, the "Purchased Assets"), free and clear of all
Encumbrances, other than Permitted Encumbrances:
(A) the customer contracts, whether written or oral, to
which Seller is a party that are listed in Section 1(A)
of the Disclosure Schedule (the "Customer Contracts");
(B) the supplier, subcontractor and vendor contracts,
whether written or oral, to which Seller is a party that
are listed in Section 1(B) of the Disclosure Schedule
(the "Vendor Contracts");
(C) the third party commercial computer software and related
maintenance contracts, to which Seller is a party that
are listed in Section 1(C) of the Disclosure Schedule
(the "Third Party Licenses");
(D) all inventory, which shall consist of new and used, both
in and out of service, inventory held for rental and
sale, including, but not limited to, all inventory
currently being held to supply Seller's contractual
commitments, and all other similar rental items or other
items of inventory that are listed in Section 1(D) of
the Disclosure Schedule (the "Inventory"), together with
any express or implied warranty by the manufacturer or
seller of any item or component part thereof;
(E) the lease of Seller's head office premises located at
0000 xx xx Xxxxxx, Xxxxxxxx, Xxxxxx, the lease of
Seller's assembly and warehousing facilities located at
000 Xxxxx 0 and 000 Xxxxx 0, Xxxx X, Xxxxxxxxxxx, Xxx
Xxxx and the leases pertaining to the service hubs
identified in Section 1(E) of the Disclosure Schedule
(the "Transferred Leases"), including any fixtures
thereon and leasehold improvements thereto;
(F) any contracts (including any solicitation or outstanding
offers for contract), whether oral or written, other
than the Customer Contracts, the Vendor Contracts, the
Third Party Licenses and the Transferred Leases, to
which Seller is a party that are listed in Section 1(F)
of the Disclosure Schedule (the Customer Contracts,
Vendor Contracts, Transferred Leases, Third Party
Licenses and Contracts listed in Section 1(F) of the
Disclosure Schedule are sometimes referred to
collectively as the "Contracts" and individually as a
"Contract");
(G) the licenses, permits, certificates, approvals,
exemptions, franchises, registrations, variances,
accreditations or authorizations that are listed in
Section 1(G) of the Disclosure Schedule (the "Permits");
(H) the Intellectual Property;
(I) the machinery, equipment, furniture, fixtures,
furnishings, office equipment, accessories, vehicles,
servers, network and telecommunications equipment,
personal computers, notebook computers, workstations,
printers, facsimile machines and other equipment needed
to operate the Business as currently operated by Seller
that are listed in Section 1(I) of the Disclosure
Schedule, and all assembly plant tools, together with
the supplies, tools, and office equipment dedicated to
or used by any Eligible Employee (regardless of whether
such Eligible Employee accepts Buyer's offer of
employment pursuant to Section 9(B)) and owned or leased
by Seller, such as cellular phones, pagers and
calculators used by each of them to operate the Business
(the "Equipment");
(J) the telephone numbers, fax numbers and uniform or
universal
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resource locators that are listed in Section 1(J) of the
Disclosure Schedule (the "Telephone, Fax and E-mail");
(K) all accounts, notes or other receivables of Seller
generated in connection with the Business, existing as
of the Closing Date that are listed in Section 1(K) of
the Disclosure Schedule (the "Accounts Receivable");
(L) all deposits and pre-paid expenses of Seller in
connection with the Business existing on the Closing
Date that are listed in Section 1(L) of the Disclosure
Schedule;
(M) all books and records relating exclusively to the
Business (other than Seller's Tax returns and Seller's
organizational books and records) including, without
limitation, lists of customers, vendors and suppliers,
records with respect to pricing, volume, billing and
payment history, cost, inventory, machinery and
equipment, mailing lists, distribution lists, sales,
purchasing and materials, technical processes,
production and testing techniques and procedures,
marketing research, design and manufacturing drawings
and specifications and other engineering data,
promotional literature, training, operations, equipment
and other manuals, quotation, correspondence, and other
miscellaneous information, including any such records
which are maintained on computer;
(N) all service manuals needed to operate the Business as
currently operated by Seller and the databases and
knowledge bases, in their current forms, listed in
Section 1(N) of the Disclosure Schedule needed to
operate the Business as curently operated by Seller; and
(O) all other assets of every kind owned by Seller and
needed to operate the Business, whether or not similar
to the items specifically set forth, except for the
Excluded Assets.
With respect to the Customer Contracts and Vendor Contracts, the
parties agree that only the contracts listed in Sections 1(A) and
1(B) of the Disclosure Schedule shall be transferred to Buyer under
this Agreement; provided that if after the Closing Buyer discovers a
contract related to the Business which Buyer determines is needed to
operate the Business as currently operated and should have been
included in the Purchased Assets, Seller will cooperate with Buyer
to transfer such contract to Buyer. With respect to all other
Purchased Assets, although the Schedules to this Agreement are
intended to be complete, to the extent any rights or assets of
Seller are needed to operate the Business as currently operated by
Seller, but are not properly itemized or do not appear on the
applicable Schedules where required, then, subject to Section 18,
unless such rights or assets are Excluded Assets, the general
language of Section 1 shall govern and such rights and assets shall
nonetheless be deemed transferred to Buyer at Closing.
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Notwithstanding the joint and several nature of the obligations of
purchase and sale set forth in the introductory paragraph of this
Section 1: (i) Optimal Corp. shall sell, assign, transfer, convey,
and deliver to NCR Canada, and NCR Canada shall purchase from
Optimal Corp., all of Optimal Corp.'s right, title and interest in
and to the Purchased Assets held by Optimal Corp., other than its
right, title and interest in and to any Intellectual Property, which
Optimal Corp. shall sell, assign, transfer, convey, and deliver NCR,
and which NCR shall purchase from Optimal Corp.; (ii) Optimal Inc.
shall sell, assign, transfer, convey, and deliver to NCR, and NCR
shall purchase from Optimal Inc., all of Optimal Inc.'s right, title
and interest in and to the Purchased Assets held Optimal Inc.; and
(iii) Optimal Plc. shall sell, assign, transfer, convey, and deliver
to NCR UK, and NCR UK shall purchase from Optimal Plc., all of
Optimal Plc.'s right, title and interest in and to the Purchased
Assets held by Optimal Plc.
2. Excluded Assets. Notwithstanding anything to the contrary contained
in Section 1 or elsewhere in this Agreement, the following property,
undertakings and assets of Seller (collectively, the "Excluded
Assets") are not part of the sale and purchase contemplated
hereunder, are excluded from the Purchased Assets and shall remain
the property of Seller after the Closing Date:
(A) all assets of Seller and its Affiliates not needed to operate
the Business as currently operated;
(B) all rights of Seller under this Agreement;
(C) all real estate and real property leases other than the
Transferred Leases;
(D) all minute books, share transfer records and corporate seals;
(E) all insurance policies and rights thereunder;
(F) all Employee Benefit Plans and administration and services
contracts, or funding arrangements;
(G) all cash, marketable securities and other short-term
investments;
(H) head office furniture, equipment, etc. of non-Eligible
Employees;
(I) Excluded Intellectual Property;
(J) Tax refunds and Tax deductions;
(K) telephone numbers and fax numbers listed in Section 2(K) of
the Disclosure Schedule; and
(L) distributorship agreements, joint marketing agreements or
letters of intent regarding distributorship or joint marketing
arrangements.
3. Limited Assumption of Liabilities. Except as specifically set forth
in this Section 3, Buyer is not assuming and will not be liable for
any obligation to
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perform or pay for any of the debts, liabilities or obligations of
Seller, whether known or unknown, now or hereafter existing, accrued
or contingent, or arising out of or related to the Purchased Assets,
the Business or the consummation of the transactions contemplated in
this Agreement (the "Transaction"). As the sole exception to the
foregoing, as of the Closing Date, Buyer agrees to assume and become
responsible for, and pay and discharge as and when due, all of the
following liabilities and obligations of Seller (collectively, the
"Assumed Liabilities"):
(A) Any debts, liabilites or obligations relating to the
Business or the Purchased Assets (including, without
limitation, the Contracts, the Permits and the Permitted
Encumbrances), of whatsoever nature or character,
whether absolute or contingent, liquidated or disputed,
relating to any matters arising after the Closing Date
and any other liabilities to be assumed by Buyer as
specifically provided in this Agreement; provided,
however, in no event shall Buyer assume any liabilities
or obligations to the extent such liabilities or
obligations are attributable to any breach or default by
Seller under such Purchased Assets occurring on or
before the Closing Date;
(B) Current liabilities of the Business, consisting solely
of accounts payable (including interest, fees and
penalties accrued prior to the Closing Date), accrued
expenses, deferred revenues and other current
liabilities included in the Closing Balance Sheet and
included in the calculation of Net Asset Value pursuant
to Section 5(A);
(C) Obligations with respect to Eligible Employees who
accept employment with Buyer, to the extent set forth in
Section 9(B);
(D) Any claims made against Buyer that the Purchased Assets
infringe on any intellectual property rights or fail to
comply with any applicable Laws, but only to the extent
that such matters are listed in Section 3(D) of the
Disclosure Schedule; and
(E) All other liabilities included in the Closing Balance
Sheet which are taken into account in calculating the
Net Asset Value pursuant to Section 5(A).
4. Purchase Price and Allocation.
(A) The aggregate purchase price for the Purchased Assets
(the "Purchase Price") shall be, exclusive of applicable
sales and transfer taxes, U.S. Thirty Million Dollars
(US$30,000,000), subject to the adjustments set forth in
Section 5, plus the assumption of the Assumed
Liabilities.
(B) Buyer shall satisfy the Purchase Price at Closing by the
assumption of the Assumed Liabilities pursuant to the
Assignment and Assumption Agreement and by payment to
Seller of U.S. Thirty
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Million Dollars (US$30,000,000) by wire transfer in
immediately available funds to a bank account of Seller
as per written instructions of Seller given to Buyer at
least two (2) Business Days prior to the Closing.
(C) The Purchase Price shall be allocated among (i) Optimal
Corp., Optimal Inc. and Optimal Plc., as Sellers, and
(ii) the Purchased Assets and Assumed Liabilities, in
each case, as set forth in Section 4(C) of the
Disclosure Schedule. Seller and Buyer shall be bound by
such allocation for all purposes, shall prepare and file
(or cause to be prepared and filed) all tax returns in a
manner consistent with such allocations, including
Internal Revenue's Form 8594, and shall not take any
position inconsistent with such allocation in any Tax
return, proceeding before any Governmental Authority or
otherwise
5. Purchase Price Adjustment.
(A) In determining the Purchase Price, Buyer assumed that
the difference between the book value of the Purchased
Assets and the Assumed Liabilities ("Net Asset Value")
on the Closing Date, excluding product and service
replacement parts inventory, will be U.S. Fourteen
Million Five Hundred Thousand dollars (US$14,500,000)
(the "Assumed Net Asset Value"). Within sixty (60) days
following the Closing Date, Seller shall prepare an
unaudited balance sheet of the Business, as of the
Closing Date, which balance sheet (the "Closing Balance
Sheet") shall be prepared in accordance with Canadian
generally accepted accounting principles, applied on a
basis that is consistent with prior periods. The
Purchase Price shall be either increased by the amount
by which the Net Asset Value derived from the Closing
Balance Sheet exceeds the Assumed Net Asset Value or
decreased by the amount by which the Assumed Net Asset
Value exceeds the Net Asset Value derived from the
Closing Balance Sheet. In the event of an increase in
the Purchase Price, the amount of such increase shall be
immediately paid by Buyer to Seller in cash, by
certified check or bank wire transfer. In the event of a
decrease in the Purchase Price, the amount of such
decrease shall be immediately paid by Seller to Buyer in
cash, by certified check or bank wire transfer.
(B) Prior to the Closing Date, Seller will inspect the
product and service replacement parts inventory to take
into account defective and obsolete inventory and
inventory in excess of Buyer's expected business
requirements, which will be written-off and excluded for
purposes of determining the value of the inventory
pursuant to this paragraph (B). At Closing, Seller shall
provide Buyer with a detailed list of all inventory
(including defective and obsolete inventory, and
inventory in excess of Buyer's expected business
requirements) included in the Purchased Assets. Within
sixty (60) days following
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the Closing Date, Buyer will conduct a physical audit of
all such inventory (the "Inventory Audit"). In the event
the Inventory Audit reflects that the book value of the
listed inventory as reflected on the books and records
of Seller as of the Closing Date exceeds by more than
U.S. Two Hundred Thousand dollars (US$200,000), the book
value of the inventory found during the physical
inventory, the Purchase Price shall be reduced by the
amount of such amount in excess of U.S. Two Hundred
Thousand dollars (US$200,000). No adjustment shall be
made in the event the book value of the listed inventory
is less than the inventory found during the physical
inventory.
(C) If Buyer disputes the Closing Balance Sheet or Seller
disputes the Inventory Audit, the parties shall work
together to resolve any such disagreements, including,
but not limited to, providing each other with such
information regarding the financial position of Seller
as of the Closing Date and the condition of product and
service replacement parts inventory, as each may
reasonably request. If the parties are unable to resolve
their disagreement regarding the Closing Balance Sheet
or the Inventory Audit within thirty (30) calendar days
of Buyer's receipt of the Closing Balance Sheet or
Seller's receipt of the results of the Inventory Audit,
as the case may be, then the parties shall submit the
matter to an independent accounting firm mutually
acceptable to Buyer and Seller (the "Neutral Accounting
Firm"). The Neutral Accounting Firm shall act as an
arbitrator to determine only those issues still in
dispute and the Neutral Accounting Firm shall either
adopt the position of Seller or Buyer or determine an
adjustment that is within the range of positions of
Seller and Buyer. If possible, the Neutral Accounting
Firm shall make its determination based solely on
presentations by Seller and Buyer; provided, however,
that if the Neutral Accounting Firm is unable to reach a
conclusion on this basis, the Neutral Accounting Firm
shall review such additional information and perform
such additional procedures as the Neutral Accounting
Firm deems reasonably necessary. The determination of
the Neutral Accounting Firm shall be made as promptly as
practicable, but in any event within thirty (30) days
following the date on which the dispute is submitted,
shall be set forth in a written statement delivered to
Seller and Buyer, and shall be final, binding and
conclusive on the parties. The fees and any expenses of
the Neutral Accounting Firm shall be paid by Buyer and
Seller within fifteen (15) calendar days of such
determination as follows: (a) if the Neutral Accounting
Firm adopts the position of Seller, then Buyer shall
bear such fees and expenses; (b) if the Neutral
Accounting Firm adopts the position of Buyer, then
Seller shall bear such fees and expenses; or (c) if the
Neutral Accounting Firm adopts a position within the
range of the positions of Buyer and Seller, each party
shall bear that percentage of such fees and expenses
deemed reasonable by the Neutral Accounting Firm in
light
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of the final determination and the original positions of
Buyer and Seller. If a retainer is required by the
Neutral Accounting Firm, the retainer shall be split
equally between Buyer and Seller; provided, however,
that the retainer shall be considered part of the fees
and expenses of the Neutral Accounting Firm and if
either party has paid a portion of such retainer, that
party will be entitled to be reimbursed by the other
party to the extent required by this Section 5(C). In
the event a party does not comply with the procedure and
time requirements contained herein or such other
procedure or time requirements as the parties otherwise
elect in writing, the Neutral Accounting Firm shall
render a decision based solely on the evidence it has
which was timely filed by either of the parties.
6. Representations, Warranties and Covenants of Seller. Seller jointly
and severally hereby represents and warrants to Buyer as follows:
(A) Disclosure Schedule. The Seller's disclosure schedule
attached hereto (the "Disclosure Schedule") is divided
into sections that correspond to the sections of this
Agreement.
(B) Organization. Each of Optimal Corp., Optimal Inc. and
Optimal plc is a corporation duly organized and validly
existing under the Laws of its jurisdiction of
incorporation, and each has the necessary corporate
power, capacity and authority to operate the Business as
currently operated by Seller and to enter into this
Agreement and the Ancillary Agreements to which it is a
party and to consummate the transactions contemplated
herein and therein. Seller is duly qualified to do
business in every jurisdiction in which it currently
operates the Business.
(C) Authority. Seller now has, and at Closing will have,
full and complete authority to enter into and execute
this Agreement, any Ancillary Agreements to which it is
a party and any and all agreements, documents and
instruments required in connection with this Agreement
and to otherwise perform its obligations and consummate
the transactions contemplated under this Agreement and
the Ancillary Agreements to which it is a party. The
execution and the delivery of this Agreement, the
Ancillary Agreements to which Seller is a party and,
except for approval by the shareholders of Optimal
Corp., the performance of the transactions contemplated
herein and therein have been duly authorized by Seller
and all corporate actions by Seller for the
authorization and consummation of the transactions
contemplated by this Agreement and the Ancillary
Agreements to which Seller is a party have been taken.
This Agreement has been validly executed and delivered
by and constitutes a valid and binding obligation of
Seller, and each of the Ancillary Agreements to which
Selller is a party will be validly executed and
delivered by and will constitute valid and binding
obligations of Seller enforceable, in each case, in
accordance with
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their respective terms, subject, however, to limitations
with respect to enforcement in connection with
bankruptcy and to the extent that equitable remedies
such as specific performance and injunctions are in the
discretion of a court of competent jurisdiction.
(D) Financial Statements. Attached hereto as Exhibit 6(D) is
Seller's unaudited balance sheet of the Business as of
December 31, 2003 (the "Unaudited Financial
Statements"). The Unaudited Financial Statements: (i)
were prepared in accordance with Canadian generally
accepted accounting principles, consistently applied,
except for the absence of notes and year-end
adjustments; (ii) fairly represent in all material
respects the assets, liabilities, the results of
operations and cash flows of the Business. Seller is not
directly or indirectly liable upon or with respect to
(by discount, repurchase agreements or otherwise), or
obliged in any other way to provide funds in respect of,
or to guarantee or assume, any debt, obligation or
dividend of any Person in relation to the Business and
which is Material to the Business, except endorsements
in the ordinary course of business consistent with past
practice in connection with the deposit, in banks or
other financial institutions, of items for collection.
All of Seller's accounts payable have been generated in
the ordinary course of the operation of the Business.
(E) No Conflict or Default. Except as set forth in Section
6(E) of the Disclosure Schedule, the execution and
performance of this Agreement and the Ancillary
Agreements to which Seller is a party, the compliance
with their provisions by Seller, and the transfer of the
Purchased Assets to Buyer on the Closing Date will not
conflict with or result in any breach of any of the
terms, conditions or provisions of any agreement,
indenture, mortgage, or other instrument to which Seller
is a party or by which it is bound, except such
conflicts or breaches which could not reasonably be
expected to have a Material Adverse Effect on Seller,
and in any event there are no breaches that would
prevent Seller from performing its obligations under
this Agreement or would give any third party any right
in the Purchased Assets. Further, assuming (i) all
required consents set forth in Section 6(E) of the
Disclosure Schedule have been obtained, (ii) Seller
Shareholders' approval, and (iii) all required
authorizations, approvals and consents of Governmental
Authorities are obtained, the execution and performance
of this Agreement and the Ancillary Agreements to which
Seller is a party, the compliance with their respective
provisions by Seller, and the transfer of the Purchased
Assets to Buyer on the Closing Date will Materially
comply with all applicable Laws, and will not conflict
with, or result in the breach of, any of the terms of
Seller's Articles of Continuance, or other governing
documents of Seller.
(F) Title to Assets. Seller has good title to, or (in the
case of leases) a
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valid lease (in the Province of Quebec) or leasehold
interest (in all other jurisdictions) in, or right to
use all of the Purchased Assets and, at the Closing,
Seller's title to the Purchased Assets will be free and
clear of all security interests, liabilities,
conditions, pledges, liens, mortgages, conditional sales
contracts, attachments, hypothecations, judgments,
easements, claims and encumbrances of every kind and
nature (collectively, "Encumbrances"), other than
Permitted Encumbrances. Seller has the full and
unrestricted right and authority to sell the Purchased
Assets, and at the Closing will sell, assign, transfer,
convey and deliver to Buyer good title to the Purchased
Assets, free and clear of all Encumbrances, other than
Permitted Encumbrances.
(G) Contracts. All of the written Contracts are in full
force and are enforceable in accordance with their
terms, and there are no outstanding breaches or defaults
(or which with or without notice, lapse of time or both,
could reasonably be expected to, indirectly or in the
aggregate, result in a breach or default) under any of
the Contracts on the part of Seller or to the Knowledge
of Seller, on the part of the other party (or parties)
to such Contract which have had or could reasonably be
expected to have a Material Adverse Effect on the
Business. All duties and obligations required to be
performed by Seller under each of the Contracts prior to
Closing have been so performed in all Material respects,
except to the extent that the liabilities relating to
such non-performance are Assumed Liabilities. Except as
set forth in Section 6(G) of the Disclosure Schedule,
the Contracts are freely assignable to Buyer, or if the
consent of the contracting party to the assignment is
required, Seller has, in respect of all Customer
Contracts, Vendor Contracts and Transferred Leases that
are listed on Section 6(G) of the Disclosure Schedule,
obtained such consent prior to Closing, or if the giving
of notice of such assignment is required under such
Customer Contracts, Vendor Contracts and Transferred
Leases, the Seller has provided such notice prior to the
Closing. To the Knowledge of Seller, no other party to
any of the Contracts is threatened with insolvency.
Assuming all required consents are obtained, the
execution, delivery, consummation and performance of
this Agreement and the Ancillary Agreements to which
Seller is a party and the transactions contemplated
herein and therein will not cause Seller to be in
material breach of any of the Contracts. Sections 1(A),
1(B), 1(C), 1(E) and 1(F) of the Disclosure Schedule
contain accurate, correct and complete lists of the (i)
customer contracts, (ii) supplier, subcontractor and
vendor contracts, (iii) third party computer software
and related maintenance contracts, (iv) leases of real
property and (v) other contracts of Seller needed to
operate the Business as currently operated by Seller.
(H) Permits. Section 1(G) of the Disclosure Schedule
contains an
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accurate, correct and complete list of the Permits that
are Material to the operation of the Business as
currently operated by Seller. The Permits are valid and
in full force and effect and there are no pending or, to
the Knowledge of Seller, threatened proceedings which
could result in the termination, revocation, limitation
or impairment of any of the Permits, except for any
termination, revocation, limitation or impairment which
could not reasonably be expected to have a material
adverse effect on the Business.
(I) Intellectual Property.
(i) Section 6(I)(i) of the Disclosure Schedule sets
out Seller's and its Affiliates' issued patents,
patent applications, applications and
registrations for Trade-marks, applications and
registrations for Copyright, Domain Names, and the
computer software, in each case, that are Material
to the operation of the Business as currently
operated by Seller.
(ii) Seller and its Affiliates have the right, title
and interest in and to the Intellectual Property
owned by Seller and the right to use the
Intellectual Property licensed by Seller from
third parties, in each case, that are needed to
operate the Business as currently operated by
Seller. To the Knowledge of Seller, the
Intellectual Property owned by Seller does not
interfere with, infringe upon, misappropriate or
violate any intellectual property rights of any
Person except as set forth in Section 6(I)(ii) of
the Disclosure Schedule. Except as set forth in
Section 6(I)(ii) of the Disclosure Schedule,
Seller has not received any written charge,
complaint, claim, demand, or notice alleging any
such interference, infringement, misappropriation,
or violation (including any claim that Seller must
license or refrain from using any intellectual
property rights of any Person relating to the
Intellectual Property). To the Knowledge of
Seller, no Person has interfered with, infringed
upon, misappropriated, or violated any
Intellectual Property owned by Seller. Seller will
make available to Buyer complete and correct
copies of all reasonably accessible user and
technical documentation related to the
Intellectual Property. Seller has generally taken
reasonably appropriate measures to protect the
confidential and proprietary nature of the
Intellectual Property, including the use of
confidentiality agreements generally with its
employees and contractors who have access to
proprietary information of Seller and who were
involved in the development of the "U-Scan
software", including, without limitation,
interfaces developed by Seller (the "U-Scan
Software"). Generally, all employees and
contractors of Seller who were involved in the
development of the U-Scan Software which is needed
to operate the Business have executed written
contracts with Seller that assigns to Seller all
rights to any inventions, improvements,
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discoveries or information relating to the
Business, which are hereby assigned to Buyer. No
employees or former employees of Seller have
claimed any right in the U-Scan Software. The
U-Scan Software does not have embedded therein any
object or source code or portions of object or
source code that includes any "Free-xxxx," or
"open-source" software.
(iii) All of the issued patents, patent applications,
trade-xxxx registrations and applications,
copyright registrations and applications, domain
names, if any, owned by the Seller and listed in
Section 6(I)(i) of the Disclosure Schedule are
currently in compliance in all Material respects
with formal legal requirements (including payment
of filing, examination and maintenance fees and
proofs of working or use), and, to the Knowledge
of Seller are valid and enforceable, and are not
subject to any maintenance fees or actions falling
due after the Closing Date other than in the
ordinary course of business.
(iv) To the Knowledge of Seller, all Domain Names
included in the Purchased Assets have been
registered in the name of Seller and are in
compliance in all Material respects with all
formal legal requirements.
(J) Inventory. All items of Inventory, including those set
forth in Section 1(D) of the Disclosure Schedule, other
than product service replacement parts inventory,
consist of quality finished goods in the ordinary course
of the operations of the Business. Except as set forth
in Section 6(J) of the Disclosure Schedule, to the
Knowledge of Seller, Seller is not in possession of any
Inventory that is not owned by Seller, including goods
already sold.
(K) Real Property Leased by Seller. All real property and
facilities used by Seller or its Affiliates in the
conduct of the Business are listed in Section 6(K) of
the Disclosure Schedule. None of the real property
listed in Section 6(K) of the Disclosure Schedule is
owned by Seller. In the case of such real property
located at 0000 xx xx Xxxxxx, Xxxxxxxx, Xxxxxx and
leased by Seller as lessee, Seller has a valid lease in
respect thereof, and Seller's right, title and interest
thereunder is free and clear of all liens, charges,
purchase rights, claims, pledges, mortgages, security
interests or encumbrances, other than Permitted
Encumbrances. In the case of such real property located
at 000 Xxxxx 0 and 000 Xxxxx 0, Xxxx X, Xxxxxxxxxxx, Xxx
Xxxx and leased by Seller as lessee, Seller has a valid
leasehold interest therein, free and clear of all liens,
charges, purchase rights, claims, pledges, mortgages,
security interests or encumbrances, other than Permitted
Encumbrances. Except as set forth in Section 6(K) of the
Disclosure Schedule, each of the Transferred Leases may
be freely assigned, assumed or sublet, is valid and in
full force and effect, and there is not pending or, to
the Knowledge of Seller,
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threatened any proceedings which could reasonably be
expected to result in the termination, revocation,
limitation or impairment of any of the Transferred
Leases. Except as set forth in Section 6(K) of the
Disclosure Schedule, the real property set forth therein
(the "Real Property"), (A) is, to the Knowledge of
Seller, leased solely by Seller; (B) is, to the
Knowledge of Seller, in compliance in all Material
respects with all applicable Laws; and (C) there are no
pending or, to the Knowledge of Seller, threatened
condemnation proceedings, lawsuits, or administrative
actions relating to the Real Property which could
reasonably be expected to have a Material Adverse Effect
on the Business.
(L) Litigation. Except as set forth in Section 6(L) of the
Disclosure Schedule, there is no litigation, proceeding,
or, to the Knowledge of Seller, governmental
investigation pending, or to the Knowledge of Seller,
threatened in front of any court, arbitration board,
administrative agency, or tribunal against or relating
to Seller which could affect the Purchased Assets, the
Business, or the consummation of this Agreement or the
sale, transfer or assignment of the Purchased Assets by
Seller.
(M) Compliance with Law. Seller has conducted the Business
in compliance in all Material respects with all Laws.
Additionally, Seller has not received any written notice
of any violation or alleged violation of any Law, except
such non-compliance which could not reasonably be
expected to have a Material Adverse Effect on the
Business.
(N) Brokers' Fees. Seller has no liability or obligation to
pay any fees or commissions to any broker, finder or
agent with respect to the transactions contemplated by
this Agreement.
(O) No Material Adverse Change. Since December 31, 2003,
there have been no changes affecting the Business which
have had or could reasonably be expected to have a
Material Adverse Effect on the Business or the Purchased
Assets, and Seller has operated the Business only in the
ordinary course of business consistent with past
practices.
(P) Accounts Receivable. All Accounts Receivable to be
transferred to Buyer under this Agreement arose from
valid transactions for goods sold or services rendered.
To Seller's Knowledge, there is no fact or circumstance
generally (other than general economic conditions and
the amount of time they have been outstanding) which
could result in any Material increase of
uncollectibility of such Accounts Receivables as a class
in excess of reserves, if any, set forth in the
Unaudited Financial Statements, nor is any Account
Receivable subject to any valid defense, counterclaim or
set-off. The list of Accounts Receivable listed in
Section 1(L) of the Disclosure
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Schedule is a true, accurate and complete list of such
accounts generated in the operation of the Business and
existing as of the date hereof and, as updated as of the
Closing Date.
(Q) Tax Matters.
(i) No failure, in any material respect, of Seller to
duly and timely pay all Taxes, including all
installments on account of Taxes for the current
year, that are due and payable by it will result
in an Encumbrance on the Purchased Assets.
(ii) To the Knowledge of Seller, there are no material
proceedings, investigations, audits or claims now
pending or threatened against Seller in respect of
any Taxes and there are no material matters under
discussion, audit or appeal with any Governmental
Authority relating to Taxes, which will result in
an Encumbrance on the Purchased Assets.
(iii) Seller, in all material respects, has duly and
timely withheld all Taxes and other amounts
required by Law to be withheld by it (including
Taxes and other amounts required to be withheld by
it in respect of any amount paid or credited or
deemed to be paid or deemed to be credited by it
or for the account or benefit of any Person,
including any Employees, officers or directors and
any non-resident Person), and has duly and timely
remitted to the appropriate Governmental Authority
such Taxes and other amounts required by Law to be
remitted by it.
(iv) Seller, in all material respects, has duly and
timely collected all amounts on accounts of any
sales or transfer taxes, including goods and
services, harmonized sales and provincial or
territorial sales taxes, required by Law to be
collected by it and has duly and timely remitted
to the appropriate Governmental Authority any such
amounts required by Law to be remitted by it.
(v) Optimal Corp. is not a non-resident of Canada
within the meaning of the Income Tax Act (Canada).
(vi) All Purchased Assets which are taxable Canadian
property within the meaning of the Income Tax Act
(Canada) will be sold by Optimal Corp.
(vii) No Purchased Assets sold by Optimal Corp.are real
estate interests located in the U.S.
(R) No Undisclosed Liabilities. Except as set forth in
Section 6(R) of the Disclosure Schedule, Seller has no
Material liabilities related to the operation of the
Business, except for liabilities reflected or reserved
against in the Unaudited Financial Statements and
current liabilities
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incurred in the ordinary course of the operation of the
Business since the Unaudited Financial Statements.
Except as set forth in Section 6(R) of the Disclosure
Schedule, Seller has no liability or obligation to
refund any economic development incentives received from
any governmental entity.
(S) Environmental, Health & Safety Compliance. Neither the
conduct nor operation of the Business, nor, to the
Knowledge of Seller, any condition of the Transferred
Leases violates any Law concerning public health and
safety, worker health and safety, and pollution or
protection of the environment ("Environmental, Health
and Safety Requirements"), except for any violation
which could not reasonably be expected to have a
Material Adverse Effect on the Business, and Seller has
not received any written notice stating that the
operation or condition of any of the property underlying
the Transferred Leases is in violation of any
Environmental, Health, and Safety Requirements.
(T) Relationships with Affiliates. Except as disclosed in
Section 6(T) of the Disclosure Schedule, following the
Closing neither Seller nor any of its Affiliates will
have any interest in any of the Purchased Assets.
Neither Seller nor any of its Affiliates owns, of record
or as a beneficial owner, an equity interest or any
other financial or profit interest in any Person that
has (a) business dealings or a material financial
interest in any transaction with Seller other than
business dealings or transactions disclosed in Section
6(T) of the Disclosure Schedule, or (b) engaged in
competition with Seller with respect to the Business in
any market presently served by Seller.
(U) Employees.
(i) Each plan, program, compensation plan, or employee
benefit arrangement, whether written or oral, for
the benefit of employees and maintained by Seller
is listed in Section 6(U)(i) of the Disclosure
Schedule (the "Employee Benefit Plans") and copies
or descriptions of each such Employee Benefit Plan
have been delivered or made available to Buyer.
Buyer shall be responsible only for the severance
obligations with respect to those Eligible
Employees who accept employment with Buyer in
accordance with Section 9, recognizing the years
of service of such Eligible Employee(s) with
Seller, but otherwise determined in accordance
with severance obligations under Buyer's benefit
plans or employment agreements which Buyer enters
into with such Eligible Employees; provided,
however, that Buyer's responsibility shall in no
event be for less than the amount that any such
Eligible Employee shall be entitled to under
applicable Law, Seller hereby representing that it
has not agreed to any severance arrangements with
any Eligible Employees, except for those Eligible
Employees listed in Section 6(U)(i)(a) of the
Disclosure Schedule. Seller will
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comply with the health care continuation
requirements of Section 601 et seq. of ERISA
("COBRA") with respect to Eligible Employees and
their eligible covered dependents.
(ii) Section 6(U)(ii) of the Disclosure Schedule
contains: (i) a list of the Eligible Employees;
(ii) the current annual total compensation
provided by Seller to each such Eligible Employee;
(iii) a list of any increase presently scheduled
(including the effective date thereof) in the rate
of base compensation of any the Eligible
Employees; and (iv) the title and location of each
such Eligible Employee.
(iii) Seller is not a party to or bound by any union
contract or collective bargaining agreement with
respect to the operation of the Business and has
not experienced with respect to the operation of
the Business any strike, grievance or any
arbitration proceeding, Material claim of unfair
labour or compensation practices filed or
threatened to be filed or any other Material
labour difficulty.
(iv) All of the Eligible Employees are United States or
Canadian citizens, or lawful permanent residents
of the United States or Canada.
(v) All payroll records provided by Seller to Buyer
for Eligible Employees for the period from January
1, 2004 to the Closing Date, are accurate.
(V) Adverse Trends. To the Knowledge of Seller: (1) there
are no Material conflicts or problems with any Eligible
Employee that would likely result in the termination or
resignation of employment of any such employee; (2)
there are no Material problems or disputes with
customers or vendors that would likely result in the
termination of the contracts or terminate a source of
supply of a Material product and there are no long-term
commitments with suppliers not set forth in Section 6(V)
of the Disclosure Schedule.
(W) Insurance Coverage. Seller maintains policies of fire,
liability and other forms of insurance covering the
Business and the Purchased Assets, in amounts and
against such losses and risks as are generally
maintained for comparable businesses and properties and
such insurance or its substantial equivalent will be
maintained through Closing.
(X) No Other Assets Needed. There are no other assets
(intangible, tangible or otherwise), other than the
Purchased Assets that are needed to operate the Business
as currently operated by Seller.
(Y) Equipment. Each item of property, plant, equipment and
other tangible personal property included in the
Purchased Assets is in
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good working order and repair (normal wear and tear
excepted, and having regard to their use and age).
(Z) Canadian Assets and Revenues. Neither the aggregate
value of the Purchased Assets in Canada nor the gross
revenues from sales in or from Canada generated by the
Purchased Assets in Canada, determined in each case in
accordance with the Notifiable Transactions Regulations
pursuant to the Competition Act (Canada), exceed Fifty
Million Canadian dollars (Cdn$50,000,000);
7. Buyer's Representations and Warranties. Buyer jointly and severally
represents and warrants to Seller as follows:
(A) Buyer's Disclosure Schedule. The Buyer's disclosure
schedule attached hereto (the "Buyer's Disclosure
Schedule") is divided into sections that correspond to
the sections of this Agreement.
(B) Organization. Each of NCR, NCR Canada and NCR UK is a
corporation validly existing, and in good standing under
the Laws of its jurisdiction of incorporation, and has
the necessary corporate power and authority to enter
into this Agreement and the Ancillary Agreements and to
consummate the transactions contemplated herein and
therein.
(C) Authority. Buyer now has, and at Closing will have, full
and complete authority to enter into and execute this
Agreement, the Ancillary Agreements and all agreements
and instruments required in connection with this
Agreement and to otherwise perform its obligations
hereunder and thereunder. The execution and the delivery
of this Agreement, the Ancillary Agreements and the
performance of the transactions contemplated herein and
therein have been duly authorized by Buyer, and all
corporate actions by Buyer for the authorization and
consummation of the transactions contemplated by this
Agreement and the Ancillary Agreements have been taken.
This Agreement has been validly executed and delivered
by and constitutes a valid and binding obligation of
Buyer, and each of the Ancillary Agreements will be
validly executed and delivered and will constitute valid
and binding obligations of Buyer enforceable, in each
case, in accordance with their respective terms,
subject, however, to limitations with respect to
enforcement in connection with bankruptcy and to the
extent that equitable remedies such as specific
performance and injunctions are in the discretion of a
court of competent jurisdiction.
(D) Approvals. No consent or approval of any Person or
Governmental Authority is required for the execution,
delivery and performance of this Agreement and the
Ancillary Agreements and the documents to be delivered
at the Closing by Buyer, and neither the execution,
delivery or performance, nor the consummation of the
transactions
-17-
contemplated herein or therein, will result in a breach
of any provision of Buyer's organizational documents or
any Law that would have a Material Adverse Effect on
Buyer's ability to perform its obligations hereunder or
thereunder.
(E) Broker or Finder's Fee. Buyer has no liability or
obligation to pay any fees or commissions to any broker,
finder or agent with respect to the transactions
contemplated by this Agreement.
(F) No Conflict or Default. Except as set forth in Section
7(F) of Buyer's Disclosure Schedule, the execution and
performance of this Agreement, the compliance with its
provisions by Buyer, the purchase of the Purchased
Assets, the assumption of the Assumed Liabilities and
the payment of the Purchase Price to Seller on the
Closing Date will not conflict with or result in any
breach of any of the terms, conditions, or provisions of
any agreement, indenture, mortgage, or other instrument
to which Buyer is a party or by which it is bound,
except such breaches which could not reasonably be
expected to have a Material Adverse Effect on Buyer, and
in any event there are no breaches that would prevent
Buyer from performing under this Agreement. Further,
except as set forth in Section 7(F) of Buyer's
Disclosure Schedule, the execution and performance of
this Agreement and the Ancillary Agreements, the
compliance with their respective provisions by Buyer,
and the purchase of the Purchased Assets by Buyer on the
Closing Date will Materially comply with all applicable
Laws and will not conflict with, or result in the breach
of, any of the terms of Buyer's Articles of
Incorporation, or other governing documents of Buyer.
The consummation of the transactions comtemplated in
this Agreement will not require the consent of any
Person with respect to any Material rights, licenses,
leases, contracts or agreements of Buyer and will not
result in any breach of or default under any such
rights, licenses, leases, contracts or agreements.
(G) Tax Registration. NCR Canada is duly registered under
Subdivision (d) of Division V of Part IX of the Excise
Tax Act (Canada) with respect to the goods and services
tax and harmonized sales tax (registration number is
89998 8430 RT0001) and under Division I of Chapter VIII
of Title I of the Quebec Sales Tax Act with respect to
the Quebec sales tax number is: 1013789343 TQ0001.
(H) Knowledge. Buyer has no Knowledge of any fact or
circumstance which would constitute a breach by Seller
of Seller's representations and warranties in this
Agreement and, except as disclosed prior to Closing, as
of the Closing Date Buyer will have no Knowledge of any
fact or circumstance which would constitute a breach by
Seller of Seller's representations and warranties in
this Agreement or in any Ancillary Agreement or Closing
documents delivered to Buyer pursuant to this Agreement.
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8. Pre-Closing Covenants of Seller. Seller hereby jointly and severally
covenants and agrees as follows:
(A) Maintenance of the Purchased Assets. Until the earlier
of Closing and termination of this Agreement, Seller
shall not lease, sell or dispose of any of the Purchased
Assets other than in the ordinary course of business
consistent with past practice or otherwise except with
the prior written consent of Buyer, which consent shall
not be unreasonably withheld, conditioned or delayed.
(B) Continuity. Until the earlier of Closing and termination
of this Agreement, Seller shall take or refrain from
taking the following actions:
(i) Seller will carry on the operation and maintenance
of the Business only in the ordinary course of
business consistent with past practices;
(ii) Seller will use all commercially reasonable
efforts to maintain and preserve relationships
with the present customers and vendors of the
Business and the Eligible Employees;
(iii) Seller will maintain its books, accounts and
records relating to the Business on a basis
consistent with that of prior periods;
(iv) Seller will not do any act or omit to do any act
or permit any act or omission to act that will
cause a breach of any Customer Contract or
Material Vendor Contract, nor will Seller
terminate, accelerate, cancel or modify any such
contract, without Buyer's consent, not to be
unreasonably withheld;
(v) Seller will maintain in full force and effect the
insurance covering the Purchased Assets under the
policies set forth in Section 6(W) of the
Disclosure Schedule or their substantial
equivalent;
(vi) Seller will use all commercially reasonable
efforts to cooperate with Buyer and provide
reasonable access to Buyer to the Business and
operations of Seller in relation to the Business
during ordinary business hours and upon reasonable
advance notice to Xxxx Xxxxxxxxx from the
Effective Date to the earlier of the Closing Date
and the date of termination of this Agreement;
(vii) Seller shall not enter into any Material
settlement of any litigation or proceeding
relating to the Purchased Assets, the Business or
the Assumed Liabilities;
(viii) Seller will not incur any Material obligation or
liability in relation to the Business or enter
into any transaction Material to the Business,
other than in the ordinary course of business and
-19-
consistent with past practices;
(ix) Seller will not mortgage, pledge or subject to any
Encumbrance any of the Purchased Assets, other
than Permitted Encumbrances;
(x) Seller will not enter into any Material contracts
in relation to the Business, except in the
ordinary course of the operation of the Business
consistent with past practices, without the prior
written consent of Buyer, not to be unreasonably
withheld;
(xi) Seller will not discontinue the sales of any
services of the Business;
(xii) Seller will not increase any salary or wage or
declare or pay any bonus, or enter into any new
employment agreement with any Eligible Employee or
make new commitments or promises to any Eligible
Employee;
(xiii) Seller will not enter into any agreement or make
any commitment to do any of the foregoing;
(xiv) Seller will maintain the existing firewalls and
other protective mechanisms for any Equipment; or
(xv) Seller shall deliver to Buyer within ten (10)
Business Days after the end of each month a copy
of the unaudited financial statements for such
month prepared in a manner and containing
information consistent with Seller's current
practices.
(C) Accounts Receivable. Seller will not intentionally
alter, modify or accelerate its existing collection
level of Accounts Receivable.
(D) Notification. Until the earlier of Closing and
termination of this Agreement, Seller shall promptly
notify Buyer in writing if it becomes aware of (a) any
fact or condition that, in Seller's reasonable
determination, causes or constitutes a breach of any of
Seller's representations and warranties made as of the
Effective Date or (b) the occurrence after the Effective
Date of any fact or condition, other than in the
ordinary course of the operation of the Business, that,
in Seller's reasonable determination, would or would
reasonably be expected to (except as expressly
contemplated by this Agreement) cause or constitute a
Material breach of any such representation or warranty
had that representation or warranty been made as of the
time of the occurrence of, or Seller's discovery of,
such fact or condition.
(E) Exclusivity. Until the earlier of Closing and
termination of this Agreement, Seller will not, and will
not permit any of its officers, directors, employees or
agents ("Seller Representatives") to solicit,
-20-
initiate or encourage inquiries or proposals, or provide
any information or participate in any negotiations or
discussions leading to any proposal, concerning any
acquisition or purchase of all or any substantial
portion of the assets or stock of Seller, any merger or
consolidation of Seller or any of its subsidiaries with
any third party, which might reasonably be expected to
interfere with the completion of the Transaction;
provided, however, that nothing contained in this
Section 8(E) or any other provision of this Agreement
shall prevent the board of directors of Optimal Corp.
(the "Optimal Board") from taking action, including
accepting an offer, in response to an unsolicited
proposal or offer from any other Person, but only to the
extent the Optimal Board is advised in writing by
external legal counsel that such action is necessary in
order to properly discharge its fiduciary duties (a
"Fiduciary Transaction"). Seller agrees that it will
immediately notify NCR regarding any contact between
Seller, its subsidiaries, or their respective
Representatives and any other person or entity regarding
any such offer or proposal or any related inquiry.
(F) Meeting of Seller Shareholders.
(i) Seller will take all action necessary in
accordance with applicable Law, its Certificate of
Continuance and By-laws, and the rules of the
Nasdaq Stock Market to duly call, give notice of,
convene and hold, as promptly as reasonably
practicable after the date hereof, a meeting (the
"Shareholders' Meeting") of the holders of Seller
shares (the "Seller Shareholders") for the purpose
of seeking approval of this Agreement and the
Transaction and shall submit this Agreement and
the Transaction for approval by Seller
Shareholders at such meeting or any adjournment
thereof.
(ii) The board of directors of Optimal Corp. shall
recommend approval of the Transaction by the
Seller Shareholders at the Shareholders' Meeting
or any adjournment thereof and shall include such
recommendation in the Proxy Statement, subject
only to the right of the board of directors of
Optimal Corp. to withdraw its recommendation if it
accepts an offer from any other Person and
otherwise complies with its obligations under the
Exclusivity Agreement.
(iii) As promptly as practicable after the execution of
this Agreement, Seller shall prepare proxy
materials or such other documentation as is
required by applicable Laws to solicit from the
Seller Shareholders proxies in favor of the
approval of this Agreement and the Transaction
(together with any amendment or supplement
thereto, the "Proxy Materials"), which Proxy
Materials shall be in compliance with applicable
Laws. Prior to distributing the Proxy Materials,
Buyer shall be given the opportunity to review and
comment on the accuracy of the disclosure
contained in the
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sections of the Proxy Material relating
exclusively to the background to the Transaction
and the description of this Agreement and any
Ancillary Agreements.
9. Additional Covenants. Each of the parties hereto, as the case maybe,
hereby covenant and agree as follows:
(A) Taxes. Notwithstanding anything herein to the contrary:
(i) Sales and Transfer Taxes. Buyer shall be liable
for, and shall indemnify and save Seller and its
directors, officers, employees, agents and
managers harmless from, any and all sales and
transfer Taxes, registration charges and transfer
fees payable in respect of the purchase and sale
of the Purchased Assets. To the exent required by
applicable Law, Seller shall collect from Buyer
and Seller shall pay directly to the appropriate
Governmental Authority, all such Taxes.
(ii) Goods and Services Tax and Quebec Sales Tax
Election. Seller and Buyer shall jointly elect,
under subSection 167(1) of Part IX of the Excise
Tax Act (Canada), Section 75 of the Quebec Sales
Tax Act, and any equivalent or corresponding
provision under any applicable provincial or
territorial legislation imposing a similar value
added or multi-staged Tax, that no Tax be payable
with respect to the purchase and sale of the
Purchased Assets under this Agreement. Seller and
Buyer shall make such election(s) in prescribed
form containing prescribed information and Buyer
shall, on a timely basis, file such election(s) in
compliance with the requirements of the applicable
Laws. Buyer shall indemnify and save harmless
Seller from and against any such Tax imposed on
Seller as a result of any failure or refusal by
any Governmental Authority to accept any such
election.
(iii) Accounts Receivable Election. In accordance with
the requirements of the Income Tax Act (Canada),
the regulations thereunder, the administrative
practice and policy of the Canada Revenue Agency
and any applicable equivalent or corresponding
provincial or territorial legislative, regulatory
and administrative requirements, Seller and Buyer
shall make and file, in prescribed form and in a
timely manner, a joint election to have the rules
in Section 22 of the Income Tax Act (Canada), and
any equivalent or corresponding provision under
applicable provincial or territorial Tax
legislation, apply in respect of the Accounts
Receivable, and shall designate therein that
portion of the Purchase Price allocated to the
Accounts Receivable.
(iv) Filing of Tax Returns. Buyer and Seller shall
prepare and file their respective Tax Returns in a
manner consistent with the elections referred to
in this Section 9(A). If a party fails to file its
Tax
-22-
Returns in such manner, it shall indemnify and
save harmless the other party in respect of any
resulting Taxes and legal and accounting expenses
paid or incurred by the other party.
(v) Certain U.S. Sales and Use Taxes. Seller may
invoice Buyer the amount of any U.S. state or
local sales or use taxes imposed on Seller under
applicable law in connection with the sale of
equipment and inventory under this Agreement, and
if applicable, will list the taxing jurisdiction
imposing the Tax on such invoice. Buyer agrees to
pay all such U.S. state or local sales or use
Taxes to Seller which are stated on an invoice
submitted by Seller promptly upon receipt of such
invoice. Seller agrees to timely remit such Taxes
to the appropriate taxing authorities.
(vi) U.S. Sales Tax Exemptions. If the applicable Law
permits, Buyer shall provide Seller with a
certificate or other mandated document evidencing
Buyer's exemption from payment of, or liability
for sales and use as authorized or required by
statute, regulation, administrative pronouncement,
or other Law of the jurisdiction providing said
exemption. If the applicable Law permits the
exemption but does not also provide an exemption
procedure, then Seller will not collect such Taxes
if Buyer furnishes Seller a letter from a Director
or higher level executive that describes the
exemption, identifies the applicable statute,
regulation, administrative pronouncement, or other
Law of the jurisdiction that both allows such
exemption and does not require an exemption
certificate; provided, however, that Buyer shall
indemnify Seller for any such Taxes subsequently
determined to be due and payable.
(vii) Personal Property Taxes. Buyer and Seller agree
that personal property Taxes and assessments
levied or assessed upon the Purchased Assets
(excluding any sales, use, transfer or similar
Taxes covered by Sections 9(A)(i) through
9(A)(vii), the apportionment and payment of which
shall be governed by those sections) shall be
prorated between the Buyer and Seller in direct
proportion to the number of days each party has
ownership of the subject property during the
current Tax year. The total amount to be prorated
shall represent one full years Taxes and
assessments resulting from the assessment date or
Tax lien date occurring during the current Tax
year, including all Taxes and special assessments
assessed upon the subject property and included on
the property Tax bills that are payable to the
appropriate state and local agencies during the
current or future Tax years. This proration shall
be based upon the current tax year's actual Taxes
and assessments, if known, or upon a reasonable
estimate of the current Tax year's taxes and
assessments if the current Tax year's Taxes and
assessments are not known at the time of closing.
-23-
Buyer shall pay to Seller at Closing its pro rata
share of personal property Taxes as determined
under the terms of this paragraph. Seller shall
remain responsible for filing all property Tax
returns, paying all Tax bills and assessments, and
addressing all audits pertaining to property Taxes
assessed upon the assets subject to this agreement
for Tax years with an assessment date or Tax lien
date occurring before the Closing Date of the
transaction proposed within this agreement. The
Seller shall also reimburse the Buyer for all
Taxes and other expenses which are the
responsibility of the Seller pursuant to this
paragraph 9(A)(vii) and which are paid by Buyer to
remedy any unpaid property Taxes assessed upon the
subject assets for the current tax year, should
the Buyer find it necessary to make such
payment(s) on behalf of the Seller to protect
clear title of the subject assets and avoid any
liens or encumbrances resulting from such unpaid
Taxes.
(B) Employee Matters.
(i) At Closing, Buyer shall have extend offers of
employment to those employees of the Seller
identified on Section 6(U)(ii) of the Disclosure
Schedule (the "Eligible Employees"), on comparable
but not less favorable terms and conditions of
employment in the aggregate as Seller employed
such individuals on the Closing Date. Buyer shall
not, however, in any event have any responsibility
for any employee litigation or potential
litigation matters listed in Section 9(B)(i) of
the Disclosure Schedule, nor for any other
employment-related claims, including but not
limited to claims for severance, asserted by any
employee of Seller (except for claims brought by
Eligible Employees who accept Buyer's offer of
employment and related to Buyer's actions
occurring after such acceptance). The parties
hereto agree to coordinate their efforts in order
to effect a smooth transition of the payroll for
the Eligible Employees from Seller to Buyer.
(ii) Accordingly, pursuant to Rev. Proc. 96-60, 1996-2
C.B. 399, provided that Seller provides Buyer with
all necessary payroll records for the calendar
year which includes the Closing Date, Buyer shall
furnish a Form W-2 or similar form, as applicable
in the given country, to each Eligible Employee
employed by Buyer who had been employed by Seller
disclosing all wages and other compensation paid
for such calendar year.
(iii) Each of the Eligible Employees who accepts
employment with Buyer shall be eligible to
participate in all health, defined and welfare
benefits and retirement plans currently offered by
Buyer to its employees, including, but not limited
to, medical, dental, life, disability, vacation
and retirement plans (subject to complying with
eligibility requirements). For purposes of
administering such plans or programs, past service
with Seller shall be deemed to be
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service with Buyer for purposes of determining
eligibility to participate in such health and
welfare plans and programs, but shall not count
for vesting in retirement plans.
(iv) Seller shall terminate its employment of all of
the Eligible Employees who accept employment with
Buyer as of Closing. In connection therewith, at
Closing, Seller shall release each of the Eligible
Employees who becomes employed by Buyer at Closing
from any confidentiality, non-competition,
non-solicitation or other restrictive covenants in
favor of Seller. Buyer and Seller agree to
cooperate in jointly notifying the Eligible
Employees of the termination of their employment
by Seller and the offer of employment by Buyer.
Eligible Employees who accept employment with
Buyer shall become employed by Buyer on the
Closing Date. Buyer shall be responsible only for
the severance obligations with respect to those
Eligible Employees who accept employment with
Buyer from and after Closing, and who are
subsequently terminated by Buyer, recognizing the
years of service of such employees with Seller,
but otherwise determined in accordance with
severance obligations under Buyer benefit plans or
employment agreements which Buyer enters into with
such Eligible Employees; provided, however, that
Buyer's responsibility shall in no event be for
less than the amount that any such employee shall
be entitled to under applicable Law.
(v) For each Eligible Employee who accepts employment
with Buyer, Seller shall provide Buyer with the
number of vacation days accrued but not used as of
the Closing Date. Buyer agrees that Eligible
Employees who accept employment with Buyer will be
permitted to take such accrued but unused vacation
during 2004 in accordance with Buyer's vacation
policy, and will provide such Eligible Employees
with a pro-rated number of additional vacation
days in 2004 that shall accrue after the Closing
Date (or the first day of employment with Buyer,
if later), pursuant to Buyer's vacation policy.
(vi) Seller shall remain solely liable or responsible
for all COBRA obligations of Seller arising from
any qualifying event as defined under Section
4980B(f)(3) of the Code and ERISA Section 603
occurring on or before the Closing Date.
(vii) The parties acknowledge that Buyer does not hereby
assume and shall not have any liability related in
any way to Eligible Employee with respect to any
such Eligible Employees' outstanding options to
purchase shares of Seller or the administration of
any of such options.
(C) Payment of Liabilities. Seller shall pay or otherwise
satisfy in the ordinary course of business all Excluded
Liabilities and Buyer shall
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pay or otherwise satisfy in the ordinary course of
business all Assumed Liabilities. The parties hereby
waive compliance with any applicable bulk sales
legislation.
(D) Removing Excluded Assets. Within thirty (30) days after
the Closing Date, Seller shall remove all Excluded
Assets from all facilities and other real property to be
occupied by Buyer. Such removal shall be done in such
manner as to avoid any Material damage to the facilities
and other properties to be occupied by Buyer and any
Material disruption of the business operations to be
conducted by Buyer after the Closing. Any Material
damage to the Purchased Assets or to the facilities
resulting from such removal shall be paid promptly by
Seller to Buyer. Should Seller fail to remove the
Excluded Assets as required by this Section, Buyer shall
have the right, but not the obligation, to remove the
Excluded Assets at Seller's sole reasonable cost and
expense to store the Excluded Assets and to charge
Seller all reasonable storage costs associated
therewith. Seller shall promptly reimburse Buyer for all
reasonable costs and expenses incurred by Buyer in
connection with any Excluded Assets not removed by
Seller on or before the 30th day following the Closing
Date upon presentation of reasonable evidence of same.
(E) Non-competition and Non-solicitation.
(i) Non-competition. In order to induce Buyer to enter
into this Agreement, and for other good and
valuable consideration, the sufficiency of which
is hereby acknowledged, Seller agrees that for a
period of five (5) years following the Closing
Date, neither Seller nor its Affiliates shall,
anywhere in the world (the "Restricted Area"),
directly or indirectly, invest in, own, manage,
operate, finance, control, advise, aid or assist,
act as a broker for, render services to, be
employed by or guarantee the obligations of any
Person engaged in or planning to become engaged in
the Business; provided, however, that nothing in
this Agreement shall restrict Seller's right to,
directly or indirectly own an equity interest in
any Person engaged in the Business whose
securities are listed on a recognized stock
exchange, so long as the interest of Seller in
such Person does not exceed ten percent (10%) of
the outstanding securities of any class of such
Person. With respect to the covenants and
agreements set forth in this Section 9(E), Seller
agrees that it may be impossible to measure in
monetary terms the damages which will accrue to
Buyer by reason of an actual breach by it of such
covenants and agreements, that a violation of such
covenants and agreements will cause irreparable
injury to Buyer, and that Buyer shall be entitled,
in addition to any other rights and remedies it
may have, at Law or in equity, to apply to a court
of competent jurisdiction for an injunction to
restrain Seller from violating, or continuing to
violate, such covenants and agreements.
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Nothing in this Section 9(E) shall be deemed to
limit Buyer's right to recover damages caused by
any actual breach by Seller. Seller acknowledges
and agrees that the current market for the
Business extends throughout the entire world, and
it is therefore reasonable to prohibit Seller from
competing with Buyer anywhere in the world
directly or indirectly, or invest in, engage
(either directly or indirectly, on its own behalf
or as a partner, member, owner, director, officer,
employee, agent, contractor, shareholder or
otherwise), in any enterprise competing directly
or indirectly with the Business.
(ii) Non-solicitation. For a period of three (3) years
following the Closing Date, Seller and its
Affiliates shall not, directly or indirectly, on
its own behalf or that of another Person: hire,
retain or attempt to hire or retain any of the
Eligible Employees who become employees of Buyer,
provided, however, that the foregoing provision
will not prevent Seller from: (i) placing a bona
fide advertisement for employment not specifically
targeted at the Eligible Employees who become
employees of Buyer; or (ii) hiring any Eligible
Employee who becomes an employee of Buyer if such
employee has been terminated without any direct
inducement by Seller.
(iii) Individual Obligations. In consideration of the
Purchase Price under this Agreement, the
individuals listed in Section 9(E)(iii) of the
Disclosure Schedule shall have the respective
non-competition and non-solicitation obligations
set forth in their respective Key Person
Agreements and the officers of Optimal Corp.
listed in Section 9(E)(iii) of the Disclosure
Schedule shall have the non-competition and
non-solicitation obligations set forth in the
Officer Agreement.
(iv) Modification of Covenant. If a final judgment of a
court or tribunal of competent jurisdiction
determines that any term or provision contained in
this Section 9(E) is invalid or unenforceable,
then the parties agree that the court or tribunal
will have the power to reduce the scope, duration
or geographic area of the term or provision, to
delete specific words or phrases or to replace any
invalid or unenforceable term or provision with a
term or provision that is valid and enforceable
and that comes closest to expressing the intention
of the invalid or unenforceable term or provision.
This Section 9(E) will be enforceable as so
modified after the expiration of the time within
which the judgment may be appealed. This Section
9(E) is reasonable and necessary to protect and
preserve Buyer's legitimate business interests in
the geographical locations in which the business
operates and the value of the Purchased Assets and
to prevent any unfair advantage conferred on
Seller. In the event that the provisions of this
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Section 9(E)(iv) are invoked and a court or
tribunal finally determines that the geographical
scope of the Section 9(E)(iv) provisions are not
enforceable or are invalid, then the parties
mutually agree to select to reduce the
geographical scope restrictions contained in
Section 9(E)(i) to solely the United States of
America and Canada.
(F) Further Assurances. The parties hereto agree to
cooperate reasonably with each other and with their
respective authorized representatives in connection with
any steps required to be taken as part of their
respective obligations under this Agreement, and shall:
(i) furnish upon request to each other such further
information; (ii) execute and deliver to each other such
other documents; and (iii) do such other acts and
things, all as the other party may reasonably request
for the purpose of carrying out the intent of this
Agreement and the Transactions contemplated hereby.
(G) Change of Address. Within thirty (30) days after the
Closing Date, Seller shall change its principal place of
business from its current location to an alternate
location. Seller, its employees, and any of its
Affiliates shall vacate the Real Property premises, and
the Purchased Assets. Seller shall amend its Articles of
Continuation to reflect its new address and shall
promptly notify the Buyer of the same.
(H) Collection of Accounts Receivable. Seller shall promptly
remit to Buyer any payments it receives in respect of
Accounts Receivable generated by the Business prior to
Closing and received by Seller after the Closing Date.
After the Closing Date, Buyer shall have the right to
notify any customers who owe Seller any amounts properly
payable to Buyer to send their payments directly to
Buyer. Buyer shall be entitled to retain all payments
received after the Closing Date for the Accounts
Receivable.
(I) Product name. On or promptly following the Closing Date,
Seller shall: (i) take all actions necessary to
terminate its use of the product name "U-Scan", and (ii)
take all actions reasonably requested by Buyer to enable
Buyer to use this name. Seller shall not use any name
that is significantly similar to the product name being
purchase hereunder.
(J) Optimal names. On or promptly following the Closing
Date, Buyer shall: take all actions necessary to
terminate the use by the Business of the trade-marks and
trade names "Optimal" and "Optimal Robotics" and any
other names related to the Excluded Intellectual
Property. Buyer shall not use any name that is
significantly similar to the Excluded Intellectual
Property.
(K) Notification. Each of Seller and Buyer agrees to
promptly notify the other party in the event such party
receives notice (whether verbal or
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in writing) of any investigation, inquiry or proceeding
by any Governental Authority concerning the Transactions
contemplated by this Agreement.
10. Indemnification.
(A) Seller Indemnification. Seller jointly and severally
agrees to indemnify and hold harmless Buyer and its
directors, officers, employees, agents and managers,
from any and all losses, claims, liabilities,
obligations, deficiencies, assessments, fines, costs,
and damages (including, without limitation, interest,
penalties, reasonable legal fees and reasonable
accounting fees), (collectively, "Damages"), resulting
from, arising from or relating to:
(i) any debts, liabilities or obligations of Seller or
the Business, whether known or unknown, now
existing or hereafter arising of whatsoever nature
or character, whether absolute or contingent,
liquidated or disputed, relating to any matters
arising on or before the Closing Date other than
the Assumed Liabilities, with all such liabilities
other than the Assumed Liabilities being
collectively referred to as the "Excluded
Liabilities";
(ii) any employees or assets not being transferred to
Buyer or any Eligible Employees who accept
employment with Buyer and make a claim regarding
actions occurring while employed by Seller (other
than in respect of accrued vacation days but not
used during 2004);
(iii) any misrepresentation, inaccuracy or breach of any
warranty or representation by Seller (or other
parties not affiliated with Buyer) in this
Agreement or the Ancillary Agreements to which it
is a party;
(iv) any failure of Seller to perform any covenant or
agreement in this Agreement or any Ancillary
Agreement to which it is a party in a timely
manner and the failure of which remains uncured
for a period of thirty (30) days after receipt of
written notice from Buyer setting forth in
reasonable detail the nature of such failure; or
(v) Seller's failure to comply with applicable bulk
sales or bulk transfer laws in connection with the
Transactions, except to the extent resulting from,
arising out of or with respect to Buyer's
obligation to pay or discharge the Assumed
Liabilities.
(B) Buyer's Indemnification. Buyer shall indemnify and hold
harmless Seller and its directors, officers, employees,
agents and managers from and against any and all Damages
resulting from, arising from or relating to: (i) the
Assumed Liabilities; (ii) the Eligible Employees who
accept employment with Buyer regarding actions occurring
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while employed by Buyer; (iii) any failure by Buyer to
perform of any of its covenants in this Agreement or any
Ancillary Agreement in a timely manner and the failure
of which remains uncured for a period of thirty (30)
days after receipt of written notice from Seller setting
forth in reasonable detail the nature of such failure;
and (iv) any breach of any warranty or the inaccuracy of
any representation of Buyer contained or referred to in
this Agreement or any certificate delivered by or on
behalf of Buyer pursuant hereto.
(C) Limitations on Certain Indemnity Obligations. Buyer and
Seller agree that any claims related to : (i) the
Excluded Liabilities; (ii) failure of Seller or Buyer to
perform any covenant in this Agreement or in any
Ancillary Agreement or to comply with any applicable
bulk sales or bulk transfer Laws, except to the extent
resulting from, arising out of or with respect to
Buyer's obligation to pay or discharge the Assumed
Liabilities; (iii) breach of the representations and
warranties contained in Sections 6(C), 6(F) or 7(C); or
(iv) any breach of any representation or warranty
involving fraud or fraudulent misrepresentation, shall
be unlimited and not subject to the Basket or the Cap.
Except as provided above, in no event shall either
party:
(i) make a claim for Damages pursuant to this Section
10 unless and until the total amount of such claim
individually exceeds U.S. Twenty-five Thousand
Dollars (US$25,000) or such claim and any other
current or prior claims, in the aggregate, exceed
U.S. Two Hundred Fifty Thousand Dollars
(US$250,000) (the "Basket"), and in such event,
then the Indemnifying Party shall reimburse the
Indemnified Party for the amount of all Damages
incurred by the Indemnified Party under this
Agreement without regard to the Basket; and
(ii) be required to pay any Damages in excess of U.S.
Thirty Million Dollars (US$30,000,000) (the
"Cap").
(D) Survival.
(i) With respect to any and all claims among the
parties hereto arising in connection with this
Agreement: (a) the representations and warranties
set forth in this Agreement shall be continuing
and shall survive the Closing until December 31,
2006; (b) the covenants set forth in the
Agreement, the Ancillary Agreements and any claim
for any breach of the representations and
warranties contained in Sections 6(C), 6(F) or
7(C), or any of the representations and warranties
contained in this Agreement involving fraud or
fraudulent misrepresentation, shall survive the
Closing and continue in full force and effect
without limitation of time, subject only to
applicable limitation periods contained in this
Agreement and limitations imposed by Law (the
period during which the
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representations and warranties and covenants and
agreements shall survive being referred to herein
with respect to such representations and
warranties and covenants and agreements as the
"Survival Period"), but shall thereafter terminate
and be of no further force and effect unless a
written notice asserting a claim shall have been
made pursuant to this Section 10(D) within the
Survival Period with respect to such matter.
(ii) All claims made hereunder prior to the expiration
of the applicable survival period stated above,
but not yet settled, shall be subject to the
indemnification provisions hereunder.
(E) Obligation to Reimburse. The party providing
indemnification hereunder (the "Indemnifying Party")
shall reimburse, within five (5) Business Days of demand
thereof, to the Person being indemnified hereunder (the
"Indemnified Party"), the amount of Damages suffered or
incurred by the Indemnified Party.
(F) Notification. Promptly upon (i) an officer of either
party (or any other Indemnified Party) obtaining actual
knowledge after the Closing of a breach of a
representation or warranty of the other Party in this
Agreement, (ii) an Indemnified Party receiving notice of
a Third Party Claim or (iii) an Indemnified Party
otherwise becoming aware of any matter which could give
rise to indemnification under this Section 10, the
Indemnified Party shall forthwith notify the
Indemnifying Party of such matter with as much detail as
is reasonably available. The omission to so notify the
Indemnifying Party (or any other Indemnified Party)
shall not relieve the Indemnifying Party from any duty
to indemnify and hold harmless which otherwise might
exist with respect to such cause unless (and only to
that extent) the omission to notify prejudices the
ability of the Indemnifying Party to exercise its right
to defend or otherwise increases the amount to be
indemnified, pursuant to this Section 10, in which case
the indemnification may be reduced to the extent that
such delay prejudiced the defense of the claim or
increased the amount of liability or cost of defense.
(G) Defense of Third Party Claim. If any legal proceeding
shall be instituted or any claim or demand shall be
asserted by a third party against the Indemnified Party
(each a "Third Party Claim"), then the Indemnifying
Party shall have the right, after receipt of the
Indemnified Party's notice under Section 10(F) and upon
giving notice to the Indemnified Party within fourteen
(14) Business Days of such receipt, to defend (and to
control the defense of) the Third Party Claim, provided
the Indemnifying Party acknowledges in writing its
obligation to indemnify the Indemnified Party for such
Third Party Claim. The Indemnifying Party shall
thereafter keep each Indemnified Party reasonably
informed with respect to the status of such Claim.
Amounts payable by the Indemnifying Party
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pursuant to a Third Party Claim shall be paid in
accordance with the terms of the settlement or the
judgement, as the case may be, but in any event prior to
the expiry of any delay for a judgement to become
executory.
(H) Defense Procedures. Upon the assumption of control of
any Third Party Claim by the Indemnifying Party as set
out in Section 10(G), the Indemnifying Party shall
diligently proceed with the defense, compromise or
settlement of the Third Party Claim at its sole expense,
including, if necessary, employment of counsel
reasonably satisfactory to the Indemnified Party and, in
connection therewith, the Indemnified Party shall
cooperate fully, but at the expense of the Indemnifying
Party with respect to any out-of-pocket expenses
incurred, to make available to the Indemnifying Party
all pertinent information and witnesses under the
Indemnified Party's control, make such assignments and
take such other steps as in the opinion of counsel for
the Indemnifying Party are reasonably necessary to
enable the Indemnifying Party to conduct such defense.
The Indemnifying Party shall not settle such Third Party
Claim unless such settlement includes as an
unconditional term thereof the giving by the claimant or
plaintiff of a full and complete unconditional release
of all Indemnified Parties from any and all liability
with respect to such Third Party Claim and does not
require any Indemnified Party to take or refrain from
taking any action and does not involve any restrictive
or other covenants or any other injunctive relief. As
long as the Indemnifying Party is diligently proceeding
with the defense, compromise or settlement of any such
Third Party Claim in good faith and on a timely basis,
the Indemnified Party shall not pay or settle any such
Third Party Claim without the consent of the
Indemnifying Party. Notwithstanding the assumption by
the Indemnifying Party of the defense of such Third
Party Claim as provided in this Section 10(H), the
Indemnified Party shall also have the right to
participate in (but not to control) the negotiation,
settlement or the defense of any Third Party Claim at
its own expense; provided, however, that if the
defendants in any such Third Party Claim shall include
both an Indemnified Party and an Indemnifying Party and
such Indemnified Party shall have reasonably concluded
that counsel selected by the Indemnifying Party has a
conflict of interest because of the availability of
different or additional defenses to such Indemnified
Party, such Indemnified Party shall have the right to
select separate counsel to participate in the defense of
such Third Party Claim on its behalf, at the expense of
the Indemnifying Party; and provided, further, that the
Indemnifying Party shall not be obligated to pay the
expenses of more than one separate counsel for all
Indemnified Parties.
(I) Failure to Defend. If the Indemnifying Party fails
within fourteen (14) Business Days from receipt of the
notice of a Third
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Party Claim to give notice of its intention to defend
the Third Party Claim in accordance with Section 10(G),
then the Indemnifying Party shall be deemed to have
waived its right to defend the Third Party Claim and the
Indemnified Party shall have the right (but not the
obligation) to undertake the defense of the Third Party
Claim and compromise and settle the Third Party Claim on
behalf, for the account and at the risk and expense of
the Indemnifying Party. In no event shall the
Indemnified Party settle such Third Party Claim unless
such settlement includes as an unconditional term
thereof the giving by the claimant or plaintiff of a
full and complete unconditional release of all
Indemnifying Parties from any and all liability with
respect to such Third Party Claim and does not require
any Indemnifying Party to take or refrain from taking
any action and does not involve any restrictive or other
covenants or any other injunctive relief.
(J) Indemnification Sole Remedy. After the Closing, the
provisions of this Section 10 shall constitute the sole
remedy of the Parties against each other with respect to
any breach or non-fulfilment of any representation,
warranty, agreement, covenant, condition or any other
obligation contained in this Agreement, the Ancillary
Agreements and any other document delivered pursuant to
this Agreement.
(K) Tax Status of Indemnification Claims. Any payment made
by Seller as an Indemnifying Party pursuant to this
Section 10 shall constitute a reduction of the Purchase
Price and any payment made by Buyer as an Indemnifying
Party pursuant to this Article shall constitute an
increase in the Purchase Price. In either case, each of
Seller and Buyer shall, as required under applicable
U.S., Canadian or U.K. Law, request all amendments to
its current or past Tax Returns as may be necessary to
reflect the foregoing. For greater certainty, any such
reduction of, or increase in, the Purchase Price shall
be allocated among the Purchased Assets to which such
payment by Seller or Buyer, respectively, can reasonably
be considered to relate. If any payment made by Seller
or Buyer as an Indemnifying Party is deemed by the
Excise Tax Act (Canada) to include goods and services
tax or harmonized sales Tax, or is deemed by any
applicable provincial or territorial legislation to
include a similar value added or multi-staged Tax, the
amount of such payment shall be increased accordingly.
11. Conditions Precedent to Buyer's Obligation to Perform. The
obligation of Buyer to consummate the transaction contemplated in
this Agreement is subject to the satisfaction or express waiver by
Buyer at or prior to the Closing of the following conditions:
(A) All representations and warranties by Seller in this
Agreement qualified by "Material" or "Material Adverse
Effect" shall be true and correct on and as if made as
of the Closing Date and all
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representations and warranties by Seller in this
Agreement or in any document delivered by Seller
pursuant to this Agreement not so qualified shall be
true and correct in all Material respects on and as if
made as of the Closing Date;
(B) All covenants of Seller qualified by "Material" or
"Material Adverse Effect" shall have been performed,
satisfied and complied with on or before the Closing
Date and all covenants, agreements and conditions
required by this Agreement to be performed or complied
with but not so qualified have been Materially
performed, satisfied or complied with by it on or before
the Closing Date;
(C) Seller shall have delivered all of the documents,
agreements, instruments and other items that Seller is
required to deliver at the Closing pursuant to Section
13(B) of this Agreement;
(D) Seller Shareholders shall have approved this Agreement
and the transactions contemplated hereby;
(E) Seller shall have delivered the "U-Scan" software source
code in a machine readable format, including
architectural maps;
(F) Since the Effective Date, there shall not have been
commenced against Buyer or any of its Affiliates, any
proceeding (a) involving any challenge to, or seeking
damages or injunctive relief in connection with, any of
the Transactions contemplated under this Agreement or
(b) that may have the effect of preventing, Materially
delaying, making illegal, imposing Material limitations
or conditions on or otherwise Materially interfering
with the Transaction;
(G) At Closing, Seller will provide updates to the
Disclosure Schedule through the Closing Date to reflect
changes thereto, which must have been approved by Buyer
acting reasonably, and further including changes to any
representations and warranties in Section 6 as to which
no reference was made on the Disclosure Schedule as of
the Effective Date but as to which a reference on the
Disclosure Schedule would have been required to have
been created on or before the Effective Date if such
changes existed on the Effective Date. Notwithstanding
the foregoing, the delivery of any updated references to
the Disclosure Schedule pursuant to this Section 11(G)
shall not cure any Material breach of any representation
and warranty requiring disclosure of any matter prior to
or on the Effective Date or otherwise limit or affect
the remedies available hereunder to Buyer;
(H) Buyer shall have entered or shall enter on the Closing
Date, into the Key Person Agreements with each of the
Key Employees, for a term of not less than two (2) years
of employment on terms and conditions otherwise
comparable to their current employment agreements with
Seller (collectively the "Key Person Agreements");
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(I) Buyer shall have entered or shall enter on the Closing
Date, into Officer Agreements with each of the officers
of Optimal Corp. listed in Section 11(I) of the
Disclosure Schedule;
(J) Seller shall have provided assistance as requested by
Buyer in obtaining appropriate amendments to any third
party agreements that Buyer reasonably believes
appropriate;
(K) Seller shall have agreed to provide, to the extent Buyer
reasonably believes necessary, short-term product
support, parts rework services and short-term Canadian
field technician support on commercially reasonable
mutually agreeable terms;
(L) There shall not be pending against Buyer, Seller or
their respective Affiliates, an investigation or
proceeding by the Canadian Commissioner of Competition,
the U.S. Department of Justice, the U.S. Federal Trade
Commission, any State Attorney General, or similar
government body in any other country with authority to
enforce anti-trust or competition laws (collectively,
"Anti-Trust Authorities") alleging that the Transaction
violates the Competition Act (Canada) or the anti-trust
laws of the United States or anti-trust or competition
Laws in any other country; nor shall any Anti-Trust
Authority have notified Buyer, or any of its Affiliates,
or Seller that any such investigation or proceeding
will, or could reasonably expected to be, commenced;
provided, however, that in the event that any Anti-Trust
Authority commences an investigation or proceeding,
Buyer shall use all commercially reasonable efforts to
address the Anti-Trust Auhorities' allegations or
concerns with Seller providing information and
assistance reasonably necessary to address the
Anti-Trust Authorities' allegations or concerns; and
(M) All required consents of Governmental authorities listed
in Section 7(F) of Buyer's Disclosure Schedule shall
have been obtained.
12. Conditions Precedent to Seller's Obligation to Perform. The
obligation of Seller to consummate the Transaction contemplated in
this Agreement is subject to the satisfaction or express waiver by
Seller at or prior to the Closing of the following conditions:
(A) All representations and warranties by Buyer in this
Agreement qualified by "Material" or "Material Adverse
Effect" shall be true and correct on and as if made as
of the Closing Date and all representations and
warranties by Seller in this Agreement or in any
document delivered by Buyer pursuant to this Agreement
not so qualified shall be true and correct in all
Material respects on and as if made as of the Closing
Date;
(B) All covenants of Buyer qualified by "Material" or
"Material Adverse
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Efsfect" shall have been performed, satisfied and
complied with on or before the Closing Date and all
covenants, agreements and conditions required by this
Agreement to be performed or complied with but not so
qualified have been Materially performed, satisfied or
complied with by it on or before the Closing Date;
(C) Buyer shall have delivered all of the documents,
agreements, instruments and other items that Buyer is
required to deliver at the Closing pursuant to Section
13(C) of this Agreement;
(D) Seller Shareholders shall have approved this Agreement
and the transactions contemplated in this Agreement;
(E) Since the Effective Date, there shall not have been
commenced against Seller or its Affiliates, any
proceeding (a) involving any challenge to, or seeking
damages or injunctive relief in connection with the
Transaction or (b) that may have the effect of
preventing, materially delaying, making illegal,
imposing material limitations or conditions on or
otherwise materially interfering with the Transactions
contemplated in this Agreement; and
(F) All required consents of Governmental authorities listed
in Section 6(E)of the Disclosure Schedule shall have
been obtained.
13. Closing.
(A) The closing of the transactions contemplated in this
Agreement (the "Closing") shall take place on or before
April 30, 2004 (the "Closing Date") at the offices of
Osler, Xxxxxx & Harcourt LLP, in Montreal, Quebec;
provided that all of the conditions precedent in Section
11 and 12 have been satisified or waived. If any of the
parties determines prior to the Closing Date that any of
the conditions set forth in Sections 11 or 12 have not
been met, such party shall notify the other in writing
at the address set forth in Section 17 below prior to
the Closing Date.
(B) At the Closing, Seller shall deliver or cause to be
delivered to Buyer the following documents, instruments,
certificates and agreements (which shall be in form and
substance reasonably satisfactory to Buyer and its
counsel):
(i) The Xxxx of Sale, duly executed by Seller;
(ii) A counterpart to the Assignment and Assumption
Agreement, duly executed by Seller;
(iii) Such other deeds, bills of sale, leases,
assignments and other instruments of sale, in form
and substance reasonably satisfactory to Buyer's
counsel, as shall be required to vest in Buyer
good title
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to the Purchased Assets, free and clear of all
Encumbrances other than Permitted Encumbrances;
(iv) Resolutions of the Boards of Directors of Optimal
Corp., Optimal Inc. and Optimal Plc., approving
this Agreement and the Transaction, certified by a
duly authorized officer;
(v) A certificate signed by an authorized officer of
Seller and dated as of the Closing Date,
certifying that the representations and warranties
of Seller contained in this Agreement qualified by
"Material" or "Material Adverse Effect" are true
and correct on the Closing Date and that
representations and warranties of Seller contained
in this Agreement not so qualified are true and
correct in all Material respects on the Closing
Date as if such representations and warranties
were made on the Closing Date; and all covenants
qualified by "Material" or "Material Adverse
Effect" have been complied with and all covenants
not so qualified have been complied with in all
Material respects;
(vi) An incumbency and specimen certificate with
respect to the officer(s) of Seller executing this
Agreement and any Ancillary Agreement to which
Seller is a party;
(vii) A Certificate of Good Standing for each Seller
issued not earlier than thirty (30) days prior to
the Closing Date;
(viii) An opinion of Osler, Xxxxxx & Harcourt LLP,
counsel to Seller, substantially in the form
attached hereto as Exhibit J, and an opinion of
U.S. counsel to Seller as to the enforceability of
this Agreement and the Ancillary Agreements to
which it is a party, in form and content
reasonably acceptable to Buyer;
(ix) A counterpart of each of the Key Person
Agreements, duly executed by each Key Person;
(x) A counterpart of each of the Officer Agreements,
duly executed by each officer of Seller listed in
Section 9(E)(iii)
(xi) Evidence reasonably acceptable to Buyer of the
approval of the transactions contemplated by this
Agreement by Seller Shareholders;
(xii) All of the required consents from third parties
set forth in Section 13(B)(xii) of the Disclosure
Schedule; and
(xiii) Any related documents that may reasonably be
requested by either party as necessary to fully
consummate the transactions contemplated by this
Agreement.
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(C) At the Closing, Buyer shall deliver or cause to be
delivered to Seller and Shareholders the following
documents, instruments, certificates and agreements
(which shall be in form and substance reasonably
satisfactory to Seller and its counsel):
(i) A certificate signed by an authorized officer of
Buyer and dated as of the Closing Date, certifying
that the representations and warranties of Buyer
contained in this Agreement qualified by
"Material" or "Material Adverse Effect" are true
and correct on the Closing Date and that
representations and warranties of Buyer contained
in this Agreement not so qualified are true and
correct in all Material respects on the Closing
Date as if such representations and warranties
were made on the Closing Date; and all covenants
qualified by "Material" or "Material Adverse
Effect" have been complied with and all covenants
not so qualified have been complied with in all
Material respects;
(ii) The Purchase Price;
(iii) A counterpart of the Assignment and Assumption
Agreement duly executed by Buyer;
(iv) Resolutions of the Board of Directors of NCR, NCR
Canada and NCR U.K. approving this Agreement and
the transactions contemplated by this Agreement,
certified by a duly authorized officer;
(v) An incumbency certificate and specimen certificate
with respect to the officer(s) of Buyer executing
this Agreement and any Ancillary Agreements to
which the Buyer is a party;
(vi) A counterpart to each of the Key Person
Agreements, duly executed by Buyer;
(vii) A counterpart to each of the Officer Agreements,
duly executed by Buyer;
(viii) Any related documents that may reasonably
requested by either party necessary to fully
consummate the transactions contemplated by this
Agreement.
14. Termination.
(A) This Agreement may be terminated on or prior to the
Closing Date:
(i) By mutual written consent of Seller and Buyer; or
(ii) by either Seller on one hand, or Buyer on the
other hand, by written notice to the other party
if:
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(1) the Transaction has not been consummated by
April 30, 2004, unless such date shall have
been extended by the mutual written consent
of Seller and Buyer; provided, however, that
this right to terminate shall not be
available to any party whose failure to
fulfill in any Material respect any covenant
or obligation under this Agreement has been
the cause of, or results in, the failure of
the Closing to occur on or before April 30,
2004; or
(2) any court of competent jurisdiction in (i)
the United States or other United States
federal or state governmental entity, or
(ii) Canada, or (iii) any other country
shall have issued an order, decree or
ruling, or taken any other action,
restraining, enjoining or otherwise
prohibiting the transactions contemplated by
this Agreement.
(iii) by Seller if:
(1) there shall have been a Material breach of
any representations or warranties set forth
in this Agreement on the part of Buyer,
which breach shall remain uncured for a
period of thirty (30) days, or any
representations or warranties of Buyer shall
have become and remain untrue in any
Material respect for a period of thirty (30)
days, provided that Seller has not
Materially breached any of its obligations
hereunder; or
(2) there shall have been a Material breach by
Buyer of any of its covenants or agreements
hereunder and such breach would result in a
Material Adverse Effect on Buyer or
materially adversely affecting (or
materially delaying) the ability of Buyer or
Seller to consummate the Transaction and
Buyer has not cured such breach within ten
(10) Business Days after notice by Seller
thereof setting forth in reasonable detail
the nature of such breach; provided that
Seller has not Materially breached any of
its obligations hereunder; or
(3) any condition to Closing set forth in
Section 12 shall not have been fulfilled or
waived by Seller by April 30, 2004; or
(4) the Optimal Board, in accordance with
Section 8(E), accepts an offer from any
other Person to complete a Fiduciary
Transaction.
(iv) by Buyer if:
(1) there shall have been a Material breach of
any
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representations or warranties set forth
in this Agreement on the part of Seller,
which breach shall remain uncured for a
period of thirty (30) days, or any
representations or warranties of the Seller
shall have become and remain untrue in any
Material respect for a period of thirty (30)
days provided that Buyer has not Materially
breached any of its obligations hereunder;
or
(2) there shall have been a Material breach by
Seller of one or more of its covenants or
agreements hereunder having a Material
Adverse Effect on the Business or Materially
adversely affecting (or materially delaying)
the ability of Seller and Buyer to
consummate the Transaction and Seller has
not cured such breach within ten (10)
Business Days after notice by Buyer thereof
setting forth in reasonable detail the
nature of such breach, provided that Buyer
has not Materially breached any of its
obligations hereunder or
(3) any condition to Closing set forth in
Section 11 shall not have been fulfilled or
waived by Buyer by April 30, 2004.
(B) Procedures Upon Termination. In the event of termination
pursuant to this Section 14, written notice shall
forthwith be given to the other party or parties, and
the Transaction shall be abandoned, without further
action by any party hereto; provided, however, that,
nothing contained herein shall be construed to prevent
any parties hereto from pursuing any remedy available at
law or in equity for any breach, violation, default or
other failure of performance of any other party hereto
prior to Closing.
(C) Break Fee. If Seller terminates this Agreement pursuant
to Section 14(A)(iii)(4) in respect of an accepted offer
to complete a Fiduciary Transaction, then, immediately
upon the closing of such Fiduciary Transaction, Seller
will pay to NCR the sum of U.S. Three Million Dollars
(US$3,000,000) (the "Break Fee"), which Break Fee will
serve as the exclusive remedy to Buyer for such
acceptance, and Buyer will not be entitled to any other
rights or remedies provided at Law or in equity. If
Seller shall breach Section 8(E) and within six months
after the date of such breach Seller signs a letter of
intent or other agreement relating to the acquisition of
all or any substantial portion of the assets of the
Business, whether directly or indirectly, through
purchase, merger, consolidation, or otherwise (other
than sales of inventory or immaterial portions of
Seller's assets in the ordinary course of the operation
of the Business) and such transaction is ultimately
consummated, then, immediately upon the closing of such
transaction, Seller will pay to NCR the Break Fee;
provided, however, that the Break Fee will not serve as
the exclusive remedy to Buyer hereunder in the event of
a breach by Seller of Section 8(E), and Buyer will be
entitled to any other rights or
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remedies provided at Law or in equity. Notwithstanding
the foregoing, in the event the amount of the Break Fee
is determined to be unenforceable under applicable law,
the Break Fee will be automatically reduced to the
highest amount enforceable under applicable law.
15. Confidentiality.
(A) Except: (i) as required by Law; (ii) as required by a
Governmental Authority or stock exchange; (iii) in
connection with the Shareholders' Meeting pursuant to
Section 8(G); (iv) between the Effective Date and the
Closing Date, where the disclosure is protected by a
confidentiality or non-disclosure agreement between
Seller and any other Person and such disclosure is made
by Seller in accordance with Section 1 of the
Exclusivity Agreement; or (v) in the ordinary course of
the operation of the Business, the parties shall deem as
Confidential Information (as defined below) all matters
of the Business and shall not disclose the same, unless
in accordance with this Agreement. The term
"Confidential Information" includes any and all of the
following information of Seller or Buyer that has been
or may hereafter be disclosed in any form, whether in
writing, orally, electronically or otherwise, or
otherwise made available by observation, inspection or
otherwise by either party (Buyer on the one hand or
Seller on the other hand) or its representatives
(collectively, a "Disclosing Party") to the other party
or its representatives (collectively, a "Receiving
Party"): (i) all information that is a trade secret
under applicable trade secret or other law; all
information concerning product specifications, data,
know-how, formulae, compositions, processes, designs,
sketches, photographs, graphs, drawings, samples,
inventions and ideas, past, current and planned research
and development, current and planned manufacturing or
distribution methods and processes, customer lists,
current and anticipated customer requirements, price
lists, market studies, business plans, computer
hardware, computer software and database technologies,
systems, structures and architectures; (ii) all
information concerning the business and affairs of the
Disclosing Party (which includes historical and current
financial statements, financial projections and budgets,
tax returns and accountants' materials, historical,
current and projected sales, capital spending budgets
and plans, business plans, strategic plans, marketing
and advertising plans, publications, client and customer
lists and files, contracts, the names and backgrounds of
key personnel and personnel training techniques and
materials, however documented), and all information
obtained from review of the Disclosing Party's documents
or property or discussions with the Disclosing Party
regardless of the form of the communication; and (iii)
and all notes, analyses, compilations, studies,
summaries and other material prepared by the Receiving
Party to the extent containing or based, in
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whole or in part, upon any information included in the
foregoing.
(B) Each Receiving Party acknowledges the confidential and
proprietary nature of the Confidential Information of
the Disclosing Party and agrees that, subject to the
proviso contained in paragraph (A) of this Section 15,
such Confidential Information (i) shall be kept
confidential by the Receiving Party; (ii) shall not be
used for any reason or purpose other than to evaluate
and consummate the Transaction; and (iii) without
limiting the foregoing, shall not be disclosed by the
Receiving Party to any Person, except in each case as
otherwise expressly permitted by the terms of this
Agreement or with the prior written consent of an
authorized representative of Seller with respect to
Confidential Information of Seller (each, a "Seller
Contact") or an authorized representative of Buyer with
respect to Confidential Information of Buyer (each, a
"Buyer Contact"). Each of Buyer and Seller shall
disclose the Confidential Information of the other party
only to its representatives who require such material
for the purpose of evaluating the Transaction and are
informed by Buyer or Seller, as the case may be, of the
obligations of this Section 15 with respect to such
Confidential Information. Each of Buyer and Seller shall
(i) enforce the terms of this Section 15 as to its
respective representatives; (ii) take such action to the
extent necessary to cause its representatives to comply
with the terms and conditions of this Section 15; and
(iii) be responsible and liable for any breach of the
provisions of this Section 15 by it or its
representatives.
(C) Unless and until this Agreement is terminated as
provided in Section 14, Seller shall maintain as
confidential any Confidential Information of Seller
relating to the Business, the Purchased Assets or the
Assumed Liabilities. Notwithstanding the preceding
sentence, Seller may use any Confidential Information of
Seller before the Closing in the ordinary course of the
operation of the Business in connection with the
transactions permitted by Section 10.
(D) From and after the Closing, the provisions of Section
15(B) above shall not apply to or restrict in any manner
Buyer's use of any Confidential Information relating to
the Business, the Purchased Assets or the Assumed
Liabilities.
(E) This Section 15 does not apply to that portion of the
Confidential Information of a Disclosing Party that a
Receiving Party demonstrates (a) was, is or becomes
generally available to the public other than as a result
of a breach of this Section 15 or that certain
Confidentiality Agreement by and between Seller and
Buyer; (b) was or is developed by the Receiving Party
independently of and without reference to any
Confidential Information of the Disclosing Party; or (c)
was, is or becomes available to the Receiving Party on a
nonconfidential basis from a Person not bound by a
confidentiality
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agreement or any legal, fiduciary or other obligation
restricting disclosure.
(F) If a Receiving Party becomes compelled in any proceeding
or is requested by a Governmental Authority having
regulatory jurisdiction over this Agreement to make any
disclosure that is prohibited or otherwise constrained
by this Section 15, that Receiving Party shall provide
the Disclosing Party with prompt notice of such
compulsion or request so that it may seek an appropriate
protective order or other appropriate remedy or waive
compliance with the provisions of this Section 15. In
the absence of a protective order or other remedy, the
Receiving Party may disclose that portion (and only that
portion) of the Confidential Information of the
Disclosing Party that, based upon advice of the
Receiving Party's counsel, the Receiving Party is
legally compelled to disclose or that has been requested
by such Governmental Authority, provided, however, that
the Receiving Party shall use reasonable efforts to
obtain reliable assurance that confidential treatment
will be accorded by any Person to whom any Confidential
Information is so disclosed. The provisions of this
Section 15 do not apply to any proceedings between the
parties to this Agreement.
(G) If this Agreement is terminated, each Receiving Party
shall (a) destroy all Confidential Information of the
Disclosing Party prepared or generated by the Receiving
Party without retaining a copy of any such material; (b)
promptly deliver to the Disclosing Party all other
Confidential Information of the Disclosing Party,
together with all copies thereof, in the possession,
custody or control of the Receiving Party or,
alternatively, with the written consent of a Seller
Contact or a Buyer Contact (whichever represents the
Disclosing Party) destroy all such Confidential
Information; and (c) certify all such destruction in
writing to the Disclosing Party, provided, however, that
the Receiving Party may retain a list that contains
general descriptions of the information it has returned
or destroyed to facilitate the resolution of any
controversies after the Disclosing Party's Confidential
Information is returned.
(H) Except as otherwise set forth in this Section 15, the
obligations of each party under this Section 15 in
respect of (i) Intellectual Property of the Business
shall survive the Closing or any termination of this
Agreement for a period of two (2) years and (ii) all
other matters shall survive the Closing for a period of
one (1) year.
16. Dispute Resolution.
(A) Injunction. Each of the parties hereto acknowledges and
agrees that a party may be irreparably damaged if an
Intellectual Property, non-compete or non-solicitation
provision of this Agreement is not performed in
accordance with their specific terms and that such
-43-
breach of this Agreement by the other party could not be
adequately compensated in all cases by monetary damages
alone. Accordingly, in addition to any other right or
remedy to which any party may be entitled, at law or in
equity, any of the parties hereto shall be entitled to
seek to enforce such provision of this Agreement by a
decree of specific performance and to temporary,
preliminary and permanent injunctive relief to prevent
any breach or threatened breach of any of the provisions
of this Agreement, without posting any bond or other
undertaking and without regard to the provisions of
Section 16(B).
(B) Arbitration.
(i) In the event that there is a dispute arising out
of or relating to this Agreement, the
relationships created by it or the transactions
occurring under it, the parties hereto shall
attempt in good faith to resolve such disputes
promptly by negotiation. Any party may give the
other parties written notice that a dispute exists
(a "Notice of Dispute"). The Notice of Dispute
shall include a brief statement of such party's
position or claim. Within ten (10) calendar days
of the delivery of the Notice of Dispute, the
parties shall meet at a mutually acceptable time
and place, and thereafter as long as they mutually
agree in order to attempt to resolve the dispute.
Subject to and without limiting the provisions of
subSection (v) of this Section 16(B), key
documents and other information or data on which
each party relies in demonstrating its position or
claim concerning the dispute shall upon reasonable
request of the other party be furnished or made
available on reasonable terms to the other party
at or before the first meeting of the Parties as
provided by this subsection. Notwithstanding the
foregoing, if the dispute has not been resolved
for whatever reason within thirty (30) calendar
days of the delivery of a Notice of Dispute, or if
the parties have failed to meet for whatever
reason within ten (10) calendar days of the Notice
of Dispute, then any controversy or claim arising
out of or relating to this Agreement, other than a
Special Claim, shall be resolved by arbitration in
accordance with the provisions of this Section
16(B). The arbitration shall commence as soon as
practicable but in any event within thirty (30)
calendar days from the expiration of the thirty
(30) day period contemplated above unless the
parties otherwise agree.
(ii) Forum and Jurisdiction. The forum for and the
place of the arbitration shall be New York, New
York.
(iii) Governing Law. This Agreement shall be governed
and construed according to the laws of New York,
excluding conflict of laws principles, provided
that any dispute relating to the validity or
effect of this arbitration clause, or to any
arbitration arising hereunder, shall be governed
by the Federal Arbitration Act.
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(iv) Administration. The arbitration shall be
administered by the American Arbitration
Association ("AAA"), pursuant to its then-current
International Rules of the AAA (the "AAA Rules"),
as modified by any other provisions that the
parties may jointly agree upon in writing (it
being understood that the parties shall be under
no obligation to so agree). Although not bound by
the formal rules of evidence, the Sole Arbitrator
(as defined below) shall be guided by the
principles set forth in the 1999 IBA Rules on the
Taking of Evidence in International Commercial
Arbitration. The parties exclude any right of
appeal of the decision of the arbitral tribunal to
any court on the merits of the dispute. Judgment
on the arbitration award may be entered in any
court having jurisdiction over the award or any of
the parties or their assets. There shall be a
single arbitrator, mutually selected by the
parties (the "Sole Arbitrator"). In the event that
the parties cannot mutually select the Sole
Arbitrator within (45) calendar days of the date
of delivery of Notice of Dispute then the AAA
shall appoint the Sole Arbitrator. The Sole
Arbitrator shall be a licensed attorney with at
least fifteen (15) years of experience in
corporate law matters. If either party brings a
claim in a competent court that is required by
this Section 16 to be brought in arbitration, and
the party successfully moves for an order
compelling arbitration, the non-prevailing party
shall be obligated to pay the prevailing party's
costs and reasonable attorney fees associated
therewith. Any demand for arbitration shall
include detail sufficient to establish the nature
of the dispute (including the claims asserted and
the material issues with respect thereto) and
shall be served upon the other party.
(v) Discovery. In the case of arbitration, discovery
from the other party shall be limited to requests
for production of documents and to five (5)
depositions, and no additional formal discovery
from the other party (e.g., interrogatories or
requests for admissions) shall be permitted except
by mutual consent or as approved by the Sole
Arbitrator for good cause shown. If disputes are
properly brought before the Courts in accordance
with this Agreement, discovery shall be as
permitted under the governing law.
(vi) Expenses. Each party shall bear its own costs of
arbitration or litigation hereunder, provided,
however, that the fees and expenses of the Sole
Arbitrator shall be shared equally between the
parties.
(vii) Remedies; Award. The Sole Arbitrator shall have no
authority to award treble, exemplary,
consequential or punitive damages of any type, or
other damages elsewhere excluded in this
Agreement, under any circumstances. In making an
award the Sole Arbitrator shall be bound by all
dollar and other limitations set forth in this
Agreement.
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(viii) Confidentiality. The arbitral proceedings and any
rulings or award shall be kept confidential by the
parties and members of the arbitral tribunal
except: (a) as necessary for enforcement or
recognition of the award; (b) with the consent of
all parties; (c) as required by Law; or (d) as
necessary to protect legitimate interests of a
party or arbitrator.
(C) Special Actions.
(i) Jurisdiction. With respect to actions, suits or
proceedings seeking specific performance of an
Intellectual Property, non-compete or
non-solicitation provision of this Agreement or
injunctive relief contemplated by Section 16(A) (a
"Special Action"), each party to this Agreement,
by its execution hereof, (a) hereby irrevocably
submits to the exclusive jurisdiction of the state
courts of the State of New York or the United
States District Court located in the Southern
District of the State of New York (the "Courts")
for the purpose of any Special Action between the
parties arising in whole or in part under or in
connection with this Agreement, (b) hereby waives
to the extent not prohibited by applicable law,
and agrees not to assert, by way of motion, as a
defense or otherwise, in any Special Action, any
claim that it is not subject personally to the
jurisdiction of the Courts, that its property is
exempt or immune from attachment or execution,
that any Special Action brought in one of the
Courts should be dismissed on grounds of forum non
conveniens, should be transferred or removed to
any court other than one of the Courts, or should
be stayed by reason of the pendency of some other
proceeding in any other court other than one of
the Courts, or that this Agreement or the subject
matter hereof may not be enforced in or by such
Court and (c) hereby agrees not to commence any
such Special Action other than before one of the
Courts. Each party agrees that for any Special
Action between the parties arising in whole or in
part under or in connection with this Agreement,
such party bring a Special Action only in the
Borough of Manhattan.
(ii) Venue. Each party further waives any claim and
will not assert that venue for such Special Action
should properly lie in any other location within
the selected jurisdiction.
(iii) Service of Process. Each party hereby (a) consents
to service of process in any Special Action
between the parties arising in whole or in part
under or in connection with this Agreement in any
manner permitted by New York law, (b) agrees that
service of process made in accordance with clause
(a) or made by registered or certified mail,
return receipt requested, at its address specified
pursuant to Section 17, will constitute good and
valid service of process in any such Special
Action and (c) waives and agrees not to assert (by
way of motion, as a defense, or otherwise) in any
such
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Special Action any claim that service of process
made in accordance with clause (a) or (b) does not
constitute good and valid service of process.
THE PARTIES HEREBY WAIVE ANY RIGHT TO TRIAL BY JURY IN ANY
PROCEEDING ARISING OUT OF OR RELATING TO THIS AGREEMENT OR ANY OF
THE CONTEMPLATED TRANSACTIONS, WHETHER NOW EXISTING OR HEREAFTER
ARISING, AND WHETHER SOUNDING IN CONTRACT, TORT OR OTHERWISE. THE
PARTIES AGREE THAT ANY OF THEM MAY FILE A COPY OF THIS SECTION WITH
ANY COURT AS WRITTEN EVIDENCE OF THE KNOWING, VOLUNTARY AND
BARGAINED-FOR AGREEMENT AMONG THE PARTIES IRREVOCABLY TO WAIVE TRIAL
BY JURY AND THAT ANY PROCEEDING WHATSOEVER BETWEEN THEM RELATING TO
THIS AGREEMENT OR THE TRANSACTION SHALL INSTEAD BE TRIED IN A COURT
OF COMPETENT JURISDICTION BY A JUDGE SITTING WITHOUT A JURY
17. Notices. Any notice, consent, authorization, direction or other
communication required or permitted to be delivered or given
hereunder shall be in writing and shall be delivered either by
personal delivery, by registered mail or by telecopier or similar
telecommunications device and addressed as follows:
If to Buyer: With a copy to (which such copy shall not
constitute notice:
XXX XXXXXXXXXXX
XXX XXXXXXXXXXX 0000 Xxxxxxxxx Xxxxxxxxx
0000 X. Xxxxxxxxx Xxxx. Xxxxxx, Xxxxxxx 00000
Xxxxxx, Xxxx 00000-0000
Attn: Law Vice-President and Chief
Attn: General Counsel Notice Counsel, Retails Solutions Division
Fax No.: (000) 000-0000 Fax No.: (000) 000-0000
If to Seller: With a copy to (which such copy shall not
constitute notice):
Optimal Robotics Corp. Osler, Xxxxxx & Harcourt LLP
c/o Osler, Xxxxxx & Harcourt LLP 0000 xx Xx Xxxxxxxxxxx Xxxxxx Xxxx,
0000 de La Gauchetiere Street West, Suite 2100
Suite 2100 Montreal, Quebec, Canada H3B 4W5
Xxxxxxxx, Xxxxxx, Xxxxxx X0X 0X0
Attn: Xxxxxx X. Xxxx Attn : Xxxxxx X. Xxxx
Fax No.: (000) 000-0000 Fax No.: (000) 000-0000
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Any notice, consent, authorization, direction or other communication
delivered as aforesaid shall be deemed to have been effectively
delivered and received, if sent by telecopier on the day of receipt
as stipulated on the acknowledgement of receipt (confirmation of
receipt by confirmed facsimile transmission being deemed receipt)
or, if delivered in any other manner, to have been delivered and
received on the date of such delivery or, if sent by registered mail
with acknowledgement of receipt requested, to have been delivered
and received on the day of receipt as stipulated on the
acknowledgement of receipt. Either party may change its address for
service by notice delivered as aforesaid.
18. Assignment of Rights.
(A) Nothing in this Agreement shall be construed as a sale,
assignment, conveyance or transfer of, or an attempt to,
where applicable, sell, assign, convey or transfer,
directly or indirectly, any Contracts, Accounts
Receivable, Transferred Leases, Intellectual Property,
Permits or other Purchased Assets (collectively, the
"Rights") if:
(i) such Right is not saleable, assignable, conveyable
or transferable by Seller without the consent of
another Person (if such consent has not been
obtained) or such sale, assignment, conveyance or
transfer or attempted sale, assignment, conveyance
or transfer would constitute a breach or
termination of such Right without the consent of
another Person (if such consent has not been
obtained), or
(ii) the remedies for the enforcement of such Right
available to Seller would not pass to Buyer.
(B) If Seller fails to obtain a consent to assign any Right
to Buyer such that the full value of any such Right may
not be realized for the benefit of Buyer, Seller shall
no later than at Closing, to the extent permitted by Law
and using its reasonable efforts, take all such action
and do or cause to be done all such things (including
entering into sub-contract or service agreements) which
are necessary or advisable in order that the obligations
of Seller in connection with such Right may be performed
in such manner that the full value of such Right to
Seller (or its Affiliates, as the case may be) is
preserved and enures to the benefit of Buyer.
(C) If Seller provides to Buyer, the full value under any
Right pursuant to Section (B) above, Buyer shall be
responsible for, and shall pay or perform, all
obligations relating thereto on the same basis as if
such Right had been assigned to and assumed by Buyer.
19. Preservation of Records. Each of Buyer and Seller agrees to retain
possession of, and cause its respective Affiliates to retain the
possession of, all records, and information (i) relating to the
Business in existence on the Closing Date and (ii)
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coming into existence within eight (8) years after the Closing Date
which relate to the Business before the Closing Date; provided that
eight (8) years after the Closing Date, each of Buyer and Seller may
dispose of any records or information that it reasonably believes is
no longer needed to be retained. In addition, from and after the
Closing Date, each of Buyer and Seller undertakes to provide access,
and cause its respective Affiliates to provide access, to the other
and the other's respective attorneys, accountants and other
representatives (after reasonable notice and during normal business
hours without interference with the ordinary conduct of the business
and with reasonable charge) to the officers, directors, employees,
attorneys, accountants and other representatives of the other and to
such records and information (excluding Tax Returns and records and
information pertaining to the period as and from the Closing Date)
including information stored on computerized information retrieval
systems, relating to the Business as each may reasonably deem
necessary to properly prepare for, file, prove, answer, prosecute
and/or defend any claim (including an assessment) or proceeding or
in order to comply with or to evaluate any obligation or liability
(under Law, by contract or otherwise).
20. No Assignment. This Agreement, and the covenants herein contained,
shall be binding upon, shall inure to the benefit of, and shall be
enforceable by the parties hereto and their respective successors
and permitted assigns. Neither Party may assign this Agreement,
either in part or in whole, without the prior written consent of the
other party.
21. Public Announcements. Except as otherwise permitted in Section 15,
any public announcement, press release or similar publicity with
respect to this Agreement will be issued, if at all, at such time
and in such manner as the parties may mutually determine. Seller and
Buyer will consult with each other concerning the means by which
Seller's employees, customers, suppliers and others having dealings
with Seller will be informed of the Transaction contemplated by this
Agreement, and Buyer will have the right to be present for any such
communication.
22. Cumulative Remedies. The rights and remedies available to any of the
parties under this Agreement shall be deemed to be in addition to,
and not in lieu of, any other rights and remedies available in law
or equity.
23. Waiver. The waiver by either party to this Agreement of any breach
of any provision of this Agreement shall not constitute a continuing
waiver or a waiver of any breach of any other provision of this
Agreement.
24. Severability. Any Section, SubSection or other subdivision of this
Agreement or any other provision of this Agreement which is, or
becomes, illegal, invalid or unenforceable in any situation in any
jurisdiction, as determined in accordance with Section 16, shall not
affect the validity or enforceability of the remaining terms and
provisions hereof or the validity or enforceability of the offending
term or provision in any other situation or in any other
jurisdiction. In the event that any provision of this Agreement is
determined in accordance with Section 16 to be invalid or
unenforceable under applicable Law in any respect, each party
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hereto intends that such provision will be construed by modifying or
limiting it so as to be valid and enforceable to the maximum extent
compatible with, and possible under, applicable Law.
25. Governing Law. This Agreement shall be governed in all respects
including its validity, construction, interpretation, breach,
performance and termination by the Laws of the State of New York and
any applicable federal Laws of the United States of America.
26. Captions. Section captions used herein are for reference purposes
only and shall not in any way affect the meaning or interpretation
of this Agreement.
27. Counterparts. This Agreement may be executed in two or more
counterparts, each of which shall be deemed on original, but all of
which taken together shall constitute one Agreement.
28. Entire Agreement; Amendment. This Agreement, together with the
Disclosure Schedule, the Buyer's Disclosure Schedule and other
Schedules and Exhibits attached hereto, supersedes all other
agreements and understandings between the parties, either oral or
written, constitutes the entire agreement of the parties with
respect to the subject matter hereof, and may be amended only by an
instrument in writing executed by all of the parties hereto.
29. Consents to Assignments. Nothing in this Agreement or the documents
to be executed and delivered at the Closing shall be deemed to
constitute an assignment or an attempt to assign any Permit,
Contract or other agreement to which Seller is a party, if the
attempted assignment thereof without the consent of the other party
to such Permit, Contract or other agreement would constitute a
breach thereof or affect in any way the rights of Seller thereunder.
30. Expenses. Except as provided in Section 8(D), each of the parties
shall pay its expenses and costs incurred or to be incurred by it in
negotiating, closing, and carrying out this Agreement, including,
without limitation, all legal and accounting fees.
31. Definitions. As used herein, the following capitalized terms have
the following meanings:
(A) "AAA" has the meaning ascribed thereto in Section 16.
(B) "AAA Rules" has the meaning ascribed thereto in Section
16.
(C) "Accounts Receivable" has the meaning ascribed thereto
in Section 1(K).
(D) "Affiliate" has the meaning ascribed thereto in the
Canada Business Corporations Act.
(E) "Ancillary Agreements" means the Assignment and
Assumption Agreement, the Xxxx of Sale, the Key Person
Agreements and the
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Officer Agreements.
(F) "Anti-Trust Authorities" has the meaning ascribed
thereto in Section 11(L).
(G) "Arbitrator" has the meaning ascribed thereto in Section
16.
(H) "Assignment and Assumption Agreement" means an
assignment and assumption agreement relating to the
assumption of the Assumed Liabilities by Buyer, in form
and substance satisfactory to the parties, acting
reasonably,
(I) "Assumed Net Asset Value" has the meaning ascribed
thereto in Section 5(A).
(J) "Basket" has the meaning ascribed thereto in Section
10(C)(i).
(K) "Xxxx of Sale" means a xxxx of sale relating to the
transfer of the Purchased Assets, in form and substance
satisfactory to the parties, acting reasonably,
(L) "Break Fee" has the meaning ascribed thereto in Section
14(C).
(M) "Business" has the meaning ascribed thereto in Recital
A.
(N) "Buyers Contact" has the meaning ascribed thereto in
Section 15(B).
(O) "Buyer's Disclosure Schedule" has the meaning ascribed
thereto in Section 7(A).
(P) "Cap" has the meaning ascribed thereto in Section
10(C)(ii).
(Q) "Closing" means the delivery, by Seller to Buyer of the
Purchased Assets, the execution of the Assignment and
Assumption Agreement and the payment by Buyer to Seller
of the Purchase Price.
(R) "Closing Balance Sheet" has the meaning ascribed thereto
in Section 5(A)
(S) "Closing Date" has the meaning ascribed thereto in
Section 13.
(T) "COBRA" has the meaning ascribed thereto in Section
6(U).
(U) "Code" means the Internal Revenue Code of 1986, as
amended and the rules and regulations adopted
thereunder.
(V) "Confidential Information" has the meaning ascribed
thereto in Section 15(A).
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(W) "Contract" or "Contracts" has the meaning ascribed
thereto in Section 1(F).
(X) "Customer Contracts" has the meaning ascribed thereto in
Section 1(A).
(Y) "Damages" has the meaning ascribed thereto in Section
10(A).
(Z) "Disclosing Party" has the meaning ascribed thereto in
Section 15(A).
(AA) "Disclosure Schedule" has the meaning ascribed thereto
in Section 6(A).
(BB) "Eligible Employees" has the meaning ascribed thereto in
Section 9(B)(i).
(CC) "Employee Benefit Plans" has the meaning ascribed
thereto in Section 6(U).
(DD) "Encumbrances" has the meaning ascribed thereto in
Section 6(F).
(EE) "Environmental, Health and Safety Requirements" has the
meaning ascribed thereto in Section 6(S).
(FF) "Equipment" has the meaning ascribed thereto in Section
1(I).
(GG) "ERISA" means the Employee Retirement Income Security
Act of 1974, as amended and the rules and regulations
adopted pursuant thereto.
(HH) "Excluded Assets" has the meaning ascribed thereto in
Section 2.
(II) "Excluded Intellectual Property" means the Intellectual
Property listed in Section 31(II) of the Disclosure
Schedule.
(JJ) "Excluded Liabilities" has the meaning ascribed thereto
in Section 10(A)(i).
(KK) "Exclusivity Agreement" has the meaning ascribed thereto
in Section 8(E).
(LL) "Employee Benefit Plans" has the meaning ascribed
thereto in Section 6(W).
(MM) "Fiduciary Transaction" has the meaning ascribed thereto
in Section 8(E).
(NN) "Governmental Authority" means any federal, state, local
or foreign government or governmental regulatory body
and any of
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their respective subdivisions, agencies,
instrumentalities, authorities, courts or tribunals.
(OO) "Indemnified Party" has the meaning ascribed thereto in
Section 10(E).
(PP) "Indemnifying Party" has the meaning ascribed thereto in
Section 10(E).
(QQ) "Intellectual Property" means all:
(i) information, including the whole or any portion or
phase of any scientific or technical information,
design, process, procedure, formula, pattern,
compilation, program, device, method, technique,
or improvement, or any business information or
plans, financial information, or listing of names,
addresses, or telephone numbers, that satisfies
both of the following: (1) it derives independent
economic value, actual or potential, from not
being generally known to, and not being readily
ascertainable by proper means by, other persons
who can obtain economic value from its disclosure
or use, or (2) it is the subject of efforts that
are reasonable under the circumstances to maintain
its secrecy ("Trade Secrets");
(ii) patents, patent applications and like protections
including without limitation provisionals,
divisions, continuations, renewals, reissues,
extensions, continuations-in-part of the same and
patentable inventions and/or improvements thereto
("Patents");
(iii) trade-marks, service marks, brands designs, trade
names whether registered or not, applications to
register and registrations of the same, and the
entire goodwill of the business of Seller
connected with and symbolized by such rights
("Trade-marks");
(iv) copyrights and registrations and applications
therefor in each work or authorship and derivative
work thereof, whether published un unpublished
("Copyright");
(v) domain names, web addresses and Internet locators
("Domain Names");
(vi) computer software, hardware and databases,
including source code and object code for Seller's
U-Scan product and documentation corresponding
thereto and any software and source code necessary
to support the U-Scan and all firmware,
development tools, compilers' notes, enhancements,
version releases and updates thereto; and
improvements to any of the foregoing; and
technology used in the Business and not embodied
in any of the foregoing ("Technology"); and
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(vii) but excluding the Excluded Intellectual Property.
(RR) "Inventory" has the meaning ascribed thereto in Section
1(D).
(SS) "Inventory Audit" has the meaning ascribed thereto in
Section 5(B).
(TT) "Key Employees" means the individuals listed in Section
31(TT) of the Disclosure Schedule.
(UU) "Key Person Agreements" has the meaning ascribed thereto
in Section 11(H).
(VV) "Knowledge" means, in the case of Seller, information
each of the officers of Optimal Corp. listed in Section
31(VV) of the Disclosure Schedule knew or should have
known, after due inquiry within Seller by such
individuals, and in the case of Buyer, information each
of the individuals listed in Section 31(VV) of Buyer's
Disclosure Schedule knew or should have known, after due
inquiry within Buyer by such individuals.
(WW) "Law" means any federal, state, local or foreign law,
ordinance, order, rule, regulation, license or permit,
and any order, writ, judgment, award, injunction, or
decree of any court or arbitrator or any Governmental
Authority having the force of law.
(XX) "Material", "Materially" or "Material Adverse Effect"
means an event or occurrence, the impact of which
exceeds U.S. Twenty-five Thousand Dollars (U.S.$25,000)
or a series of events or occurrences, the impact of
which exceeds in the aggregate U.S. Two Hundred Fifty
Thousand Dollars (U.S.$250,000).
(YY) "Net Asset Value" has the meaning ascribed thereto in
Section 5(A).
(ZZ) "Notice of Dispute" has the meaning ascribed thereto in
Section 16.
(AAA) "Officer Agreement" means an agreement in the form
annexed hereto as Exhibit 31(AAA).
(BBB) "Optimal Board" has the meaning ascribed thereto in
Section 8(E).
(CCC) "Permits" has the meaning ascribed thereto in Section
1(G).
(DDD) "Permitted Encumbrances" means:
(i) encumbrances of mechanics, labourers, workmen,
builders, contractors, suppliers of material or
architects or other similar encumbrances
incidental to construction, maintenance or repair
operations which have either been registered or
filed pursuant to Laws against the Business or not
yet registered or filed and which, in any such
case, relate to obligations not due and payable as
at the
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Closing Date;
(ii) statutory encumbrances relating to obligations not
due and payable as at the Closing Date;
(iii) encumbrances for Taxes, assessments, charges of
Governmental Authorities or levies not due and
payable as at the Closing Date;
(iv) encumbrances for public utilities not due and
payable as at the Closing Date;
(v) rights of equipment lessors under equipment leases
included in the Contacts provided however that
such rights shall be a Permitted Encumbrances only
if the terms of such equipment letters have been
complied with in all material respects through the
Closing Date;
(vi) financing statements evidencing the rights of
equipment lessors under equipment leases included
in the Contracts in and to the equipment or
vehicles which are subject of such Contracts
provided that such financing statements shall be
Permitted Encumbrances only if the terms of such
equipment leases have been complied with in all
Material respects through the Closing Date; and
(vii) any privilege in favour of any lessor, licensor or
permitter for rent to become due or for other
obligations or acts, the performance of which is
required under Contracts so long as the payment of
or the performance of such other obligation or act
is not delinquent and provided that such
Encumbrances or privileges do not adversely affect
the use or value of the assets affected thereby.
(EEE) "Person" means any individual, corporation, partnership,
joint venture, association, limited liability company,
joint stock company, trust, or unincorporated
association, or any Governmental Authority, officer,
department, commission, board, bureau or instrumentality
thereof.
(FFF) "Proxy Material" has the meaning ascribed thereto in
Section 8(F)(iii)
(GGG) "Purchase Price" has the meaning ascribed thereto in
Section 4(A).
(HHH) "Purchased Assets" has the meaning ascribed thereto in
Section 1.
(III) "Real Property" has the meaning ascribed thereto in
Section 6(K).
(JJJ) "Receiving Party" has the meaning ascribed thereto in
Section 15(A).
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(KKK) "Restricted Area" has the meaning ascribed thereto in
Section 9(E).
(LLL) "Rights" has the meaning ascribed thereto in Section
18(A).
(MMM) "Sellers Contact" has the meaning ascribed thereto in
Section 15(B).
(NNN) "Sellers Representatives" has the meaning ascribed
thereto in Section 8(E).
(OOO) "Seller Shareholders" has the meaning ascribed thereto
in Section 8(F).
(PPP) "Shareholders' Meeting" has the meaning ascribed thereto
in Section 8(F).
(QQQ) "Special Action" has the meaning ascribed thereto in
Section 16;
(RRR) "Survival Period" has the meaning ascribed thereto in
Section 10(D).
(SSS) "Tax Returns" means all returns, reports, declarations,
elections notices, filings, forms, statements and other
documents (whether in tangible, electronic or other
form) and including any amendments, schedules,
attachments, supplements, appendices and exhibits
thereto, made, prepared, filed or required to be made,
prepared or filed by Law in respect of Taxes.
(TTT) "Taxes" means any taxes, duties, fees, premiums,
assessments, imposts, levies and other similar charges
imposed by any Governmental Authority under applicable
Law, including all interest, penalties, fines, additions
to tax or other additional amounts imposed by any
Governmental Authority in respect thereof, and including
those levied on, or measured by, or referred to as,
income, gross receipts, profits, capital, transfer, land
transfer, sales, goods and services, harmonized sales,
use, value-added, excise, stamp, withholding, business,
franchising, property, development, occupancy, employer
health, payroll, employment, health, social services,
education and social security taxes, all surtaxes, all
customs duties and import and export taxes, countervail
and anti-dumping, all licence, franchise and
registration fees and all employment insurance, health
insurance and Canada, Quebec and other government
pension plan premiums or contributions, and any such
Taxes individually is a "Tax".
(UUU) "Telephone, Fax and E-Mail" has the meaning ascribed
thereto in Section 1(J).
(VVV) "Third Party Claim" has the meaning ascribed thereto in
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Section 10(G).
(WWW) "Third Party Licences" has the meaning ascribed thereto
in Section 1(C).
(XXX) "Transaction" has the meaning ascribed thereto in
Section 3.
(YYY) "Transferred Leases" has the meaning ascribed thereto in
Section 1(E).
(ZZZ) "Unaudited Financial Statements" has the meaning
ascribed thereto in Section 6(D).
(AAAA) "U-Scan Software" has the meaning ascribed thereto in
Section 6(I)(ii).
(BBBB) "Vendor Contracts" has the meaning ascribed thereto in
Section 1(B).
IN WITNESS WHEREOF, the parties hereto have executed this Agreement as of
the Effective Date.
XXX XXXXXXXXXXX OPTIMAL ROBOTICS CORP.
By: /s/ Xxx Xxxxxx By: /s/ Xxxx X. Xxxxxxxx
-------------------------- ----------------------------
(Signature) (Signature)
Name: Xxx Xxxxxx Name: Xxxx X. Xxxxxxxx
-------------------------- ---------------------------
(Please print) (Please print)
Title: SVP - RSD Title: Co-Chairman and CEO
-------------------------- ---------------------------
NCR LIMITED (UK) OPTIMAL ROBOTICS INC.
By: /s/ Xxxxxxxx Xxxxx By: /s/ Xxxxx X. Xxxx
-------------------------- ---------------------------
(Signature) (Signature)
Name: Xxxxxxxx Xxxxx Name: Xxxxx X. Xxxx
-------------------------- ---------------------------
(Please print) (Please print)
Title: Director Title: President
-------------------------- ---------------------------
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NCR CANADA LTD. OPTIMAL ROBOTICS PLC.
By: /s/ Xxxxxx X. Xxxxxx By: /s/ Holden X. Xxxxxx
-------------------------- ---------------------------
(Signature) (Signature)
Name: Xxxxxx X. Xxxxxx Name: Holden X. Xxxxxx
-------------------------- ---------------------------
(Please print) (Please print)
Title: Assistant Secretary Title: Chairman
-------------------------- ---------------------------
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