STOCK PURCHASE AGREEMENT
AMONG:
DIONEX CORPORATION,
LC PACKINGS NEDERLAND B.V.,
LC PACKINGS (U.S.A.), INC.,
THE SHAREHOLDERS OF LC PACKINGS NEDERLAND B.V.
AND
THE SHAREHOLDERS OF LC PACKINGS (U.S.A.), INC.
________________________________
Dated as of October 17, 2000
________________________________
1. DESCRIPTION OF TRANSACTION 1
1.1 Sale and Purchase of Shares 1
1.2 Effectiveness of the Sale and Assignment 1
1.3 Deliveries 2
1.4 Governing Documents 2
1.5 Initial Purchase Price 2
1.6 Additional Purchase Price 3
1.7 Further Action 6
2. REPRESENTATIONS AND WARRANTIES OF THE SHAREHOLDERS 6
2.1 Due Organization; Subsidiaries; Etc. 6
2.2 Charter Documents; Records 7
2.3 Capitalization, Etc. 8
2.4 Financial Statements 8
2.5 Absence of Changes 9
2.6 Title to Assets 10
2.7 Bank Accounts; Receivables; Customers 11
2.8 Equipment; Leasehold 12
2.9 Proprietary Assets 12
2.10 Contracts 14
2.11 Liabilities 15
2.12 Compliance with Legal Requirements 16
2.13 Governmental Authorizations 16
2.14 Tax and Social Security Filings 16
2.15 Employee and Labor Matters; Benefit Plans 17
2.16 Environmental Matters 18
2.17 Sale of Products; Performance of Services 19
2.18 Insurance 20
2.19 Related Party Transactions 20
2.20 Legal Proceedings; Orders 21
2.21 Authority; Binding Nature of Agreement 21
2.22 Non-Contravention; Consents 22
2.23 No Brokers 23
2.24 Elimination of Certain Pension Liabilities 23
2.25 Payments to Shareholders 23
2.26 General Release 24
2.27 Full Disclosure 24
3. REPRESENTATIONS AND WARRANTIES OF PURCHASER 24
3.1 Authority; Binding Nature of Agreement 24
3.2 Legal Proceedings 24
3.3 Non-Contravention; Consents 24
3.4 No Brokers 25
3.5 Full Disclosure 25
4. INDEMNIFICATION, ETC. 25
4.1 Survival of Representations, Etc. 25
4.2 Indemnification; Setoff 26
4.3 Procedure for Claims 27
4.4 Threshold; Ceiling 28
4.5 No Contribution 28
4.6 Defense of Third Party Claims 28
5. TAX AND OTHER INDEMNIFICATION 30
5.1 General 30
5.2 Limitation Period 30
5.3 Notice of Audits; Cooperation 30
5.4 Payments 30
6. PROPRIETARY INFORMATION, NONCOMPETITION AND
OTHER COVENANTS 31
6.1 Acknowledgements 31
6.2 No Use of Confidential Information 32
6.3 Covenants Not to Compete 32
6.4 Rights and Remedies 34
6.5 Other Covenants 34
7. MISCELLANEOUS PROVISIONS 34
7.1 Shareholders' Agent 34
7.2 Further Assurances 35
7.3 Fees and Expenses 35
7.4 Recovery of Litigation Costs 35
7.5 Notices 35
7.6 Confidentiality 37
7.7 Headings 37
7.8 Governing Law; Venue 37
7.9 Successors and Assigns 38
7.10 Waiver 38
7.11 Amendments 39
7.12 Severability 39
7.13 Parties in Interest 39
7.14 Entire Agreement 39
7.15 Construction 39
7.16 Remedies Cumulative; Specific Performance 40
7.17 Counterparts 40
EXHIBITS
Exhibit A - Certain Definitions
Exhibit B - Form of Notarial Deed (LCP NL)
Exhibit C - Form of Stock Assignment (LCP US)
STOCK PURCHASE AGREEMENT
AGREEMENT, dated as of October 17, 2000, by and between DIONEX
CORPORATION, a Delaware corporation ("Purchaser"), LC PACKINGS
NEDERLAND B.V., a private company with limited liability under the
laws of the Netherlands ("LCP NL"), LC PACKINGS (U.S.A.), INC., a
California corporation ("LCP US") and the SHAREHOLDERS OF LCP NL
AND LCP US (the "Shareholders"). LCP NL and LCP US are
collectively referred to as the "Companies."
Certain capitalized terms used in this Agreement are defined in
Exhibit A.
RECITALS
A. The parties desire to effect a sale of 100% of the
outstanding capital stock of LCP NL ("LCP NL Capital Stock") and
100% of the outstanding capital stock of LCP US ("LCP US Capital
Stock") by the Shareholders to Purchaser, as described in the
following table:
LCP NL LCP US
Capital Stock Owned Capital Stock Owned
Shareholder Name and to be Sold and to be Sold
Xxxx-Xxxxxx Xxxxxxx 1,340 A Shares 400 Shares
Xxxx-Xxxxxx Xxxxxxxx 360 B Shares 400 Shares
Xxxxxxxx Xxxxxxxx 0 Shares 400 Shares
Xxxxx Xxxxx 300 B Shares 0 Shares
Totals 2,000 Shares 1,200 Shares
B. This Agreement has been adopted and approved by (1) the board
of directors of Purchaser, (2) the managing directors of LCP NL,
and (3) the board of directors of LCP US, in each case as required
by applicable law.
AGREEMENT
The parties to this Agreement, intending to be legally bound,
agree as follows:
1. DESCRIPTION OF TRANSACTION.
1.1 Sale and Purchase of Shares. Upon the terms and subject to
the conditions set forth in this Agreement, immediately upon
execution of this Agreement (the "Effective Time"),
the Shareholders shall sell and assign the shares of LCP NL
Capital Stock and the shares of LCP US Capital Stock set forth in
the table contained in Recital A of this Agreement to Purchaser
(the "Purchase"). All such shares are collectively referred to as
the "Shares." Each of the Shareholders consents to the sale and
assignment of the Shares held by each of the other
Shareholders. Purchaser accepts the sale and assignment of the
Shares.
1.2 Effectiveness of the Sale and Assignment. The sale and
assignment shall become effective upon payment of the purchase
price as provided for in Section 1.5.
1.3 Deliveries. At the Effective Time:
(a) Each of the Shareholders will transfer the LCP NL Capital
Stock owned by him to Purchaser through the due execution of a
notarial deed in front of a civil law notary practicing in the
Netherlands in the form of Exhibit B, and the Shareholders shall
deliver to Purchaser the shareholders register of LCP NL,
evidencing the transfer of the LCP NL Capital
Stock from the Shareholders to Purchaser effective as of the
Effective Time;(b) Each of the Shareholders will transfer the LCP
US Capital Stock owned by him to Purchaser through the due
execution of a notarized stock assignment in the form of
Exhibit C, and the Shareholders shall deliver to Purchaser the
stock book and share register of LCP US, evidencing the transfer
of the LCP US Capital Stock from the Shareholders to
Purchaser effective as of the Effective Time;
(c) Subject to applicable Legal Requirements, promptly after being
requested to do so by Purchaser after the Effective Time, the
officers and directors, including managing directors, of each of
the Companies shall resign from each of their positions at each of
the Companies to the extent requested by Purchaser and shall cause
each employment, consulting or similar agreement between any of
the Shareholders and any of the Companies to be terminated,
and to that effect each of them shall deliver to counsel to
Purchaser resignation letters and termination agreements in form
and substance satisfactory to counsel to Purchaser;
(d) Purchaser shall make the cash payments specified in Section
1.5 by wire transfer;
(e) Each of the Shareholders shall execute and deliver a General
Release, as described in Section 2.26; and
(f) Each of the Shareholders shall deliver a Spousal Consent, in
the form following the signature pages of this Agreement, duly
executed by his spouse.
1.4 Governing Documents. The charter and other governing
documents of LCP NL and LCP US shall be amended and restated as of
the Effective Time in the manner specified by Purchaser; provided,
however, that if such amendment or restatement specified by
Purchaser is for any reason rejected or rendered ineffective by a
Governmental Body, none of the obligations to pay any of the
amounts payable pursuant to Section 1.5 and 1.6 shall in any way
be affected thereby.
1.5 Initial Purchase Price.
(a) The initial aggregate purchase price payable by Purchaser for
the Shares at the Effective Time shall be USD 12,000,000. The
initial aggregate purchase price is allocated among the
Shareholders as follows:
(1) Xxxx-Xxxxxx Xxxxxxx, USD 6,200,000;
(2) Xxxx-Xxxxxx Xxxxxxxx and Xxxxxxxx Xxxxxxxx, jointly,
USD 4,000,000; and
(3) Xxxxx Xxxxx, USD 1,800,000.
(b) Such purchase price will be paid as follows:
(1) USD 6,200,000 to ING Bank, for the benefit of Xxxx-
Xxxxxx Xxxxxxx;
(2) USD 4,000,000 to United Bank of Switzerland, for the benefit
of
Xxxx-Xxxxxx Xxxxxxxx and Xxxxxxxx Xxxxxxxx, jointly; and
(3) USD 1,800,000 to ING Bank, for the benefit of Xxxxx Xxxxx.
1.6 Additional Purchase Price.
(a) Subject to achievement by the Companies of target Turnover
amounts shown below for the year indicated and the limitations set
forth in this Section 1.6, Purchaser shall pay the following
additional amounts to the Shareholders within 30 days after the
following dates as additional consideration for the sale and
assignment of the Shares:
Year Ending Target Xxxx-Xxxxxx Xxxx-Xxxxxx Xxxxx Total
Turnover Chervet and Xxxxxxxx Xxxxx Payment
Amount (51.6667%) (33.3333%) (15.0000%)
Dec. 31, 2000 USD 6,000,000 USD 516,666.67 USD 333,333.33 USD 150,000.00 USD 1,000,000
Dec. 31, 2001 USD 7,000,000 USD1,291,666.67 USD 833,333.33 USD 375,000.00 USD 2,500,000
Dec. 31, 2002 USD 8,000,000 USD1,550,000.00 USD1,000,000.00 USD 450,000.00 USD 3,000,000
Dec. 31, 2003 USD 9,000,000 USD1,550,000.00 USD1,000,000.00 USD 450,000.00 USD 3,000,000
Dec. 31, 2004 USD10,000,000 USD1,808,333.33 USD1,166,666.67 USD 525,000.00 USD 3,500,000
Totals USD40,000,000 USD 13,000,000
(b) Notwithstanding the foregoing, the obligation of Purchaser to
make the payments contemplated by this Section 1.6 shall be
subject to any right of setoff that Purchaser may be entitled to
exercise (pursuant to Section 4.2 or otherwise).
(c) The right to receive the payments set forth in Section 1.6(a)
shall be cumulative 1 as illustrated in this Section.6(c).
(1) The amount by which the Turnover Amount for a particular year
exceeds the relevant target Turnover Amount for such year shall be
carried forward and applied toward the target Turnover Amount for
the following year. For example, if the Turnover
Amount for the year ending December 31, 2000 is USD 7,000,000, USD
1,000,000 will be carried forward to the year ending December 31,
2001 so that if the actual Turnover Amount for
such year is USD 6,000,000 or greater, the payment for such year
will be earned.
(2) If the Turnover Amount for a particular year is less than the
relevant target Turnover Amount for such year, the total Turnover
Amount shall be carried forward and applied toward the target
Turnover Amount for the following year. For example, if
the Turnover Amount for the year ending December 31, 2000 is USD
5,000,000, USD 5,000,000 will be carried forward and applied
toward the target Turnover Amount for the following year.
(3) If the cumulative Turnover Amount achieved from January 1,
2000 through December 31 of a given year is equal to exceeds the
sum of the target Turnover Amounts for such years, Purchaser will
make the total payments required for all such years to the
extent not previously made. For example, if the Turnover Amount
for the year ending December 31, 2000 is 7,000,000 (and,
therefore, the first installment payment is made) and the
Turnover Amount for the year ending December 31, 2001 is
1,000,000, but the cumulative Turnover Amount for the three years
ending December 31, 2002 is 21,000,000, then a total of
USD 5,500,000 (for the second and third installment payments)
shall be paid to the Shareholders before January 30, 2003.
(4) If, at the end of a given year, there is a shortfall with
respect to a target Turnover Amount (after giving effect to (1)
and (2) above) that is less than the amount of the installment
payment that would have been earned at that time if such target
Turnover Amount had been achieved, then Purchaser shall pay to the
Shareholders an amount equal to the difference between such
shortfall and such installment by paying each of them on a pro
rata basis according to their respective portions of the
additional purchase price.
(5) Before January 30, 2005, Purchaser will pay to the
Shareholders the difference between (A) the product of (1) the
proportion the cumulative Turnover Amount for the five years
ending December 31, 2004 bears to the cumulative target Turnover
Amount for such five-year period and (2) USD 13,000,000 and (B)
the total installment payments previously made pursuant to this
Section 1.6.
(6) Notwithstanding the operation of clauses (1)-(5) above, in no
event shall the total payments to the Shareholders pursuant to
this Section 1.6 exceed USD 13,000,000.
(d) For purposes of this Section 1.6, the "Turnover Amount" for a
given year shall mean the sum of (1) total sales invoiced to
customers (excluding intercompany sales) during such year by the
Companies and (2) total sales invoiced to customers (excluding
intercompany sales) for Products and Services during such year by
Purchaser or any of its majority- or wholly-owned subsidiaries
(excluding Products developed by companies acquired by Purchaser
after the Effective Time or licensed by Purchaser after the
Effective Time), as determined by Purchaser in accordance with
U.S. generally accepted accounting principles, observing
continuity in the accounting principles. From and after the
Effective Time and throughout the balance of the aforementioned
five-year period, Purchaser shall use all commercially reasonable
efforts, both directly and through its majority- and wholly-owned
subsidiaries, including the Companies, to effect such sales of
Products and Services as soon as practicable in accordance with
the respective companies' normal business practices.
(e) Purchaser and its independent auditors shall make all of their
work papers and records with respect to the determination of
Turnover Amount reasonably available to the Shareholders' Agent
upon written request. Upon the written request of the
Shareholders' Agent stating his reason(s) for disagreeing with the
Turnover Amount determination within 30 days after being notified
thereof by Purchaser, Purchaser and the Shareholders' Agent shall
promptly meet and attempt in good faith to resolve their
disagreement within 15 days after the Shareholders' Agent notified
Purchaser of the disagreement. If resolution is not reached
during that time, an audit shall be promptly conducted by an
internationally recognized accounting firm, other than Deloitte &
Touche LLP, mutually and reasonably acceptable to Purchaser and
the Shareholders' Representative. The results of such audit shall
be provided in writing to the parties and shall be final and
binding upon the parties to this Agreement. The fees and expenses
for such audit shall be paid by the Shareholders if the Turnover
Amount determined by such accounting firm is equal to or less than
105% of the Turnover Amount determined by Purchaser, and shall
otherwise be paid by Purchaser. In no event shall more than one
audit be conducted pursuant to this Section 1.6(e) with respect to
any calendar year.
(f) Notwithstanding any other provision of this Agreement, in the
event Purchaser (1) sells either of the Companies or all or
substantially all of their assets or all or substantially all of
the assets of the Companies or (2) engages in a transaction that
results in the shareholder(s) of Purchaser or either of the
Companies immediately prior to the transaction owning less than a
majority of the voting securities of Purchaser or either of the
Companies (or their successor entity) immediately after such
transaction, then each of the Turnover Amount targets for years
ending after the date of such transaction shall be deemed achieved
for the purposes of this Agreement.
(g) Notwithstanding any other provision of this Agreement, no
payment to any Shareholder of any portion of the additional
purchase price under this Section 1.6 is or shall ever be
conditioned upon or in any way subject to the employment or
continued employment of Messrs. Chervet, Xxxxxxxx or Ursem or Xx.
Xxxxxxxx by Purchaser or the Companies.
(h) For purposes of this Section 1.6, "Products" shall mean (1)
all products currently offered for sale by the Companies, (2) all
products developed by the Companies at any time prior to the
expiration of the aforementioned five-year period, and (3) all
products developed by Purchaser and its U.S. and international
majority- and wholly-owned subsidiaries for use in the fields of
proteomics, genomics, miniaturized HPLC (defined as HPLC
techniques using columns with an interior diameter of 1.0 mm or
smaller), any combination thereof, and any software bundled
therewith, the development of which is completed after the
Effective Time.
For purposes of this Section 1.6, "Services" shall mean any and
all services rendered by Purchaser and its majority- or wholly-
owned subsidiaries, including the Companies, in connection with
any of the Products.
(i) The obligations of Purchaser to pay the additional purchase
price under the provisions of this Section 1.6 shall be secured by
an irrevocable "stand-by" letter of credit issued by a nationally
recognized financial institution, or by a bond, escrowed funds or
other method reasonably acceptable to a majority in interest of
the Shareholders. Purchaser shall establish such security within
30 days of the Effective Time, and such security shall be in the
amount of USD 13,000,000. The amount of such security may be
reduced upon and to the extent of payments actually made on
account of the additional purchase price. Such security shall be
non-negotiable and non-transferable; provided, however, that it
may be assigned together with the rights to receive payment of the
additional purchase price pursuant to the provisions of
Section 7.9. The obligation of Purchaser to furnish such security
shall continue until January 30, 2005 unless otherwise agreed by
the parties. In the event of a dispute as of such date between
the parties regarding the payment of additional purchase price,
Purchaser shall promptly establish similar security for the
disputed amount.
1.7 Further Action. If, at any time after the Effective Time, any
further action is determined by Purchaser to be necessary or
desirable to carry out the purpose of this Agreement or to vest
Purchaser with full right, title and possession of and to all
rights and property of the Companies, the officers and directors
(including managing directors) of LCP NL, LCP US and Purchaser
shall be fully authorized (in the name of the Companies and
otherwise) to take such action.
2. REPRESENTATIONS AND WARRANTIES OF THE SHAREHOLDERS.
Any investigation carried out by Purchaser and any information
provided by the Shareholders or the Companies to Purchaser shall
not discharge the Shareholders in any way from their obligations
with respect to the representations and warranties. The provisions
of this article are based on a deliberate division of risk between
Purchaser on the one side and the Shareholders on the other side.
The Shareholders acknowledge that Purchaser is relying on the
representations and warranties in connection with the purchase of
the Shares and that the accuracy of the representations and
warranties in all respects is essential for decision of Purchaser
to enter into this Agreement.
The representations and warranties are only restricted by matters
correctly, fully and specifically disclosed in the Disclosure
Schedule.
The Shareholders, jointly and severally (except as otherwise
specifically noted herein), represent and warrant to Purchaser
that, as of the Effective Time, except as set forth in the
Disclosure Schedule attached hereto (the "Disclosure Schedule"),
the following statements are true:
2.1 Due Organization; Subsidiaries; Etc.
(a) Each of the Companies is a corporation duly organized and
validly existing and is in compliance with the corporate
requirements of its jurisdiction of incorporation or formation and
has all necessary power and authority: (i) to conduct its
business in the manner in which its business is currently being
conducted; (ii) to own and use its assets in the manner in
which its assets are currently owned and used; and (iii) to
perform its obligations under all of the Companies' contracts.
(b) None of the Companies has conducted any business under any
fictitious name, assumed name, trade name, registered name or
other name, other than the name "LC Packings" and any product
names.
(c) Part 2.1(c) of the Disclosure Schedule accurately sets forth
(i) the names of the members of the board of directors of each of
the Companies and (ii) the names and titles of the officers
(including managing directors) of each of the Companies, in each
case as of the date of execution of this Agreement.
(d) Except as set forth in Part 2.1(d) of the Disclosure Schedule,
neither of the Companies has any subsidiaries, and neither has
ever owned, beneficially or otherwise, any shares of or other
equity interest in, or any direct or indirect ownership interest
of any nature in, any other Entity. Neither of the Companies has
agreed and neither of them is obliged to make any future
investment in or capital contribution to any other Entity.
(e) None of the assets or proprietary rights used in the business
of any of the Companies is owned or held by Xxxxxxx XX Packings or
bai GmbH. No employees of Xxxxxxx XX Packings or bai GmbH work in
the business of any of the Companies.
(f) There has been no proposal made or resolution adopted by any
competent corporate body for the dissolution or liquidation of
either of the Companies nor do any circumstances exist that could
reasonably be expected to result in the dissolution of liquidation
of either of the Companies. Except for the Plan and Agreement of
Reorganization by Merger made as of September 1, 1991, between
Clear Thinking Corporation, a California corporation, and
LCP US, which was filed with the Secretary of State of the State
of California on July 1, 1992, no proposal has been made nor any
resolution been adopted by any competent corporate body of
either of the Companies for the statutory merger ("juridische
fusie") of either of the Companies with any other entity or for a
split ("splitsing") of the two Companies.
(g) Neither Company has applied for a declaration of bankruptcy or
moratorium of payments. Neither Company has been declared
bankrupt or granted a moratorium of payments.
2.2 Charter Documents; Records.
(a) The Shareholders have delivered to Purchaser accurate and
complete copies of (i) the Articles of Incorporation, Deed of
Incorporation or Articles of Association (the "Charter Documents")
and the most recent versions of the Charter Documents of each of
the Companies and (ii) the minutes and records of the meetings and
other proceedings (including any resolutions adopted by written
consent or otherwise without a meeting) of the Shareholders of
each of the Companies. There are no shareholder resolutions
amending any such documents that have not yet been registered in
the applicable public register. Other than the Buy-Out Agreement
Between LC Packings (U.S.A.), Inc., and its Shareholders, dated as
of January 1, 1991 (the "Buy-Out Agreement"), there are no
shareholder agreements or agreements between any of the
Companies and their shareholders relating to the constitution
and/or organization of any of the Companies. The Shareholders, to
the extent they are parties thereto, hereby waive their rights
under the Buy-Out Agreement as they apply to the transactions
contemplated by this Agreement.
There have been no meetings or other proceedings or actions of the
shareholders or the directors of any of the Companies that are in
conflict with the applicable laws and the respective governing
documents of each of the Companies. To the best of the
Shareholders' Knowledge, the books of account and other records of
each of the Companies are accurate, up-to-date and complete in all
material respects, and have been maintained in accordance with
prudent business practices and all applicable Legal Requirements.
(b) Except as listed in the trade registry extract of LCP NL, LCP
NL has no managing directors ("statutair directeuren"),
supervisory directors ("commissarissen") or proxyholders
("procuratiehouders"), other than as listed in Part 2.1(c) of the
Disclosure Schedule.
2.3 Capitalization, Etc.
(a) The authorized capital stock of LCP NL consists of 3,000 A
shares and 2,000 B shares of LCP NL Capital Stock, NLG 100 each,
in the total amount of NLG 500,000, 1,340 A shares and 660 B
shares of which have been issued and are outstanding. The
authorized capital stock of LCP US consists of 1,000,000 common
shares of LCP US Capital Stock, 1,200 shares of which have been
issued and are outstanding. Recital A of this Agreement sets
forth the name of each of the shareholders of LCP NL and LCP US
and the number of shares of LCP Capital Stock and LCP US Capital
Stock owned by each of such shareholders. All of the
outstanding shares of LCP NL Capital Stock and LCP US Capital
Stock have been duly authorized and validly issued, and are fully
paid and non-assessable, no repayments have been made in respect
of such shares by the Companies to the Shareholders and, except as
provided in the Buy-Out Agreement (subject to the waiver in
Section 2.2), none of such shares is subject to any repurchase
option or restriction on transfer. As of the Effective Time,
Purchaser will acquire good and valid title to all of the Shares,
free and clear of any Encumbrances, upon payment as provided in
Section 1.5.
(b) Each of the Shareholders, severally but not jointly,
represents and warrants that he holds good and valid title to the
outstanding shares of LCP NL Capital Stock and LCP US Capital
Stock shown opposite his name in Recital A of this Agreement, free
and clear of any Encumbrances.
(c) To the best of the Shareholders' Knowledge, all outstanding
shares of capital stock of each of the Companies have been issued
in compliance with (1) all applicable Legal Requirements and (2)
all requirements set forth in applicable Contracts.
(d) Any shares of capital stock or other securities repurchased,
redeemed or otherwise reacquired by any of the Companies were
validly reacquired in compliance with all applicable Legal
Requirements.
(e) Except as provided in the Buy-Out Agreement (subject to the
waiver in Section 2.2), there are no outstanding subscriptions,
options, calls, warrants, rights (including conversion, preemptive
or first refusal rights) or other agreements of any kind for the
subscription or purchase or acquisition, from any of the Companies
or any of the Shareholders, of any stock of any of the Companies
or the Subsidiaries. There is no outstanding security, instrument
of obligation that is or may become convertible into or
exchangeable for any shares of the capital stock or other
securities of either of the Companies or contract under which
either of the Companies is or may become obligated to sell or
otherwise issue any shares of its capital stock or any other
securities.
2.4 Financial Statements. The annual accounts (including balance
sheet, profit-and-loss accounts and notes) of the Companies for
the fiscal year ended December 31, 1999 (collectively, the "Annual
Statements") and the general ledgers of the Companies for the
seven months ended July 31, 2000 (collectively, the "Interim
Statements") that have been provided to Purchaser have been duly
prepared in accordance with accounting principles generally
accepted in the Netherlands or the accounting principles generally
accepted in the country of incorporation of each of the Companies,
as applicable, observing continuity in the accounting and
evaluation principles. The Annual Statements and Interim
Statements present a true and fair view of the assets,
liabilities, and financial and profit situation of the Companies
as of December 31, 1999 and July 31, 2000, respectively. The
books, records and other documents provided by the Companies to De
Keijzer, Nipius & Co., when taken together as a whole, are
accurate and complete in all material respects.
2.5 Absence of Changes. Except as set forth in Part 2.5 of the
Disclosure Schedule, since December 31, 1999:
(a) there has not been any change in the business, condition,
assets, liabilities, operations, financial performance or
prospects of any of the Companies that has had, or could
reasonably be expected to have, a Material Adverse Effect on any
of the Companies, and, to the best of the Shareholders' Knowledge,
no event has occurred that will, or could reasonably be
expected to, have a Material Adverse Effect on any of the
Companies;(b) there has not been any loss, damage or destruction
to, or any interruption in the use of, any of the assets of any of
the Companies (whether or not covered by insurance) that has had,
or could reasonably be expected to have, a Material Adverse Effect
on any of the Companies;
(c) none of the Companies has declared, accrued, set aside or paid
any dividend or made any other distribution in respect of any
shares of capital stock, or has repurchased, redeemed or otherwise
reacquired any shares of capital stock or other securities;
(d) none of the Companies has sold, issued or authorized the
issuance of (1) any capital stock or other security, (2) any
option, call, warrant or right to acquire, or otherwise
relating to, any capital stock or any other security or (3) any
instrument convertible into or exchangeable for any capital stock
or other security;(e) none of the Companies has (1) made or
committed to make any capital expenditure on any fixed assets in
excess of USD 25,000 or that, when added to all other capital
expenditures on fixed assets made by any of the Companies since
December 31, 1999, exceeds USD 50,000 in the aggregate, or (2)
leased or licensed any right or asset from any Person requiring
payments of more than USD 25,000 or under a lease or license with
a term of three years or more;(f) none of the Companies has (1)
entered into or permitted any of the assets owned or used by it to
become bound by any Material Contract or (2) amended or
prematurely terminated, or waived any material right or remedy
under, any Material Contract to which it is or was a party or
under which it has or had any rights or obligations;
(g) none of the Companies has (1) sold or otherwise disposed of,
or leased or licensed, any right or other asset (other than
products in the ordinary course of business) to any
other Person (other than immaterial rights or other immaterial
assets disposed of or leased or licensed by one or more of the
Companies to other Persons in the ordinary course of business
and consistent with past practices) or (2) knowingly waived or
relinquished any right (other than immaterial rights waived or
relinquished by one or more of the Companies in the ordinary
course of business and consistent with past practices);
(h) none of the Companies has written off as uncollectible,
established any reserve with respect to or compromised any account
receivable or other indebtedness;(i) none of the Companies has
made any pledge of any of its assets or otherwise permitted any of
its assets to become subject to any Encumbrance, except for
pledges of immaterial assets made in the ordinary course of
business and consistent with past practices and retention of title
in the ordinary course of business;(j) none of the Companies has
(1) loaned money to any Person or (2) incurred or guaranteed any
indebtedness for borrowed money;(k) none of the Companies has (1)
established, adopted or amended any Employee Benefit Plan or (2)
made any profit-sharing, bonus or similar payment to any of its
directors, officers or employees, except as disclosed pursuant to
Part 2.15(c) of the Disclosure Schedule;(l) none of the Companies
has (1) entered into, modified, amended or extended in any
material respect any employment agreement or arrangement which
cannot be terminated on three months' notice or less and without
payment of any penalty, (2) increased the compensation payable to
any employee, officer or managing director of any of the
Companies, or (3) hired or has outstanding any offer to hire any
new employee, officer or managing director;(m) none of the
Companies has changed any of its methods of accounting or
accounting practices in any respect;(n) none of the Companies has
made any Tax election;(o) none of the Companies has commenced or
settled any Legal Proceeding;(p) none of the Companies has made
any change in the course of dealing with any of its customers,
suppliers or employees that, taken as a whole, has had or could
reasonably be expected to have a Material Adverse Effect on the
Companies;(q) none of the Companies has entered into any material
transaction or taken any other material action outside the
ordinary course of business or inconsistent with its past
practices; and(r) none of the Companies has agreed or committed to
take any of the actions referred to in clauses (c) through (q)
above.
2.6 Title to Assets.
(a) Except as set forth in Part 2.6(a) of the Disclosure Schedule,
each of the Companies owns, and has good, valid and marketable
title to, all assets purported to be owned by it, including: (1)
all assets reflected on the Annual Statements; (2) all assets
referred to in the Disclosure Schedule; (3) all other assets
reflected in the books and records of the Companies as being owned
by one or more of the Companies. Except as set forth in Part
2.6(a) of the Disclosure Schedule, all of such assets are owned by
the Companies free and clear of any Encumbrances, except for minor
liens that have arisen in the ordinary course of business and that
do not (in any case or in the aggregate) materially detract from
the value of the assets subject thereto or materially impair the
operations of any of the Companies.
(b) Part 2.6(b) of the Disclosure Schedule identifies all assets
that are being leased or licensed to any of the Companies, except
for (1) any equipment being leased to any of the Companies under a
standard operating lease requiring annual payments by the
Companies of less than USD 25,000 and (2) any software being
licensed to any of the Companies under any third party software
license generally available to the public at a total cost of less
than USD 1,000.
2.7 Bank Accounts; Receivables; Customers.
(a) Part 2.7(a) of the Disclosure Schedule provides current and
accurate information (including account numbers, type of account
and names of all individuals authorized to draw on or make
withdrawals from each account) with respect to each account
maintained by or for the benefit of any of the Companies at any
bank or other financial institution.
(b) Each of the Companies has provided to Purchaser an accurate
and complete written breakdown and aging of all accounts
receivable, notes receivable and other receivables of the
Companies as of July 31, 2000, except for those collected in full
since July 31, 2000. Except as set forth in Part 2.7(b) of the
Disclosure Schedule, all existing accounts receivable of the
Companies (including those accounts receivable reflected on the
balance sheet included in the Annual Statements that have not yet
been collected and those accounts receivable that have arisen
since July 31, 2000 and have not yet been collected) (1) represent
valid obligations of customers of one or more of the Companies
arising from bona fide transactions entered into in the ordinary
course of business and (2) are current and, to the best of the
Shareholders' Knowledge, will be collected in full when due,
without any counterclaim or set off, net of an allowance for
doubtful accounts and bad debt not to exceed USD 25,000 in the
aggregate.
(c) Each of the Companies has provided to Purchaser written
information that (1) identifies and provides an accurate and
complete breakdown of the revenues received from each customer or
other Person that accounted for more than 5% of the revenues of
the Companies in the fiscal year ended December 31, 1999 or the
seven months ended July 31, 2000 and (2) identifies each customer
that as of July 31, 2000 was obligated to make payments to any
of the Companies in an aggregate amount exceeding USD 50,000 per
year. Except as set forth in Part 2.7(c) of the Disclosure
Schedule, none of the Shareholders has any Knowledge indicating
that any customer or other Person intends or expects to cease
dealing with any of the Companies or to effect a material
reduction in the volume of business transacted by such Person with
any of the Companies below historical levels.
(d) Each of the Companies has provided to Purchaser written
information that (1) identifies and provides an accurate and
complete breakdown of the amounts paid to each supplier or other
Person that accounted for more than 5% of the expenses of the
Companies in the fiscal year ended December 31, 1999 or the seven
months ended July 31, 2000 and (2) identifies each supplier to
which as of July 31, 2000 the Companies were obligated to make
payments in an aggregate amount exceeding USD 50,000 per year.
Except as set forth in Part 2.7(d) of the Disclosure Schedule,
none of the Shareholders has any Knowledge indicating that any
supplier or other Person intends or expects to cease dealing with
any of the Companies or to effect a material reduction in the
volume of business transacted by such Person with any of
the Companies below historical levels.
2.8 Equipment; Leasehold.
(a) Each of the Companies has provided to Purchaser written
information that accurately lists all material assets of the
Companies that are reasonably required for or used in
the conduct of the business of the Companies in the manner in
which such business is currently being conducted. The assets of
the Companies are appropriate for the uses to which they are
being put and are, when taken as a whole, in good condition and
repair (ordinary wear and tear excepted) and appropriate for the
conduct of the business of the Companies in the manner in
which such business is currently being conducted.
(b) None of the Companies owns any real property or any interest
in real property, except for the leaseholds created under the real
property leases identified in Part 2.8(b) of the Disclosure
Schedule. Part 2.8(b) of the Disclosure Schedule provides an
accurate description of the premises covered by said leases. The
Companies enjoy peaceful and undisturbed possession of such
premises.
2.9 Proprietary Assets.
(a) Part 2.9(a)(1) of the Disclosure Schedule sets forth, with
respect to each Company Proprietary Asset that has been
registered, recorded or filed with any Governmental Body or with
respect to which an application has been filed with any
overnmental Body, (1) a brief description of such Company
Proprietary Asset and (2) the names of the jurisdictions
covered by the applicable registration, recordation, filing or
application. Part 2.9(a)(2) of the Disclosure Schedule identifies
of all other Company Proprietary Assets owned by any of the
Companies. Part 2.9(a)(3) of the Disclosure Schedule identifies
and provides a brief description of each Company Proprietary Asset
that is owned by any other Person and that is licensed to or
used by any of the Companies (except for any Company Proprietary
Asset that is licensed to any of the Companies under any third
party software license that (1) is generally available to the
public at a cost of less than USD 1,000, and (2) imposes no future
monetary obligation on any of the Companies) and identifies the
license agreement or other agreement under which such
Company Proprietary Asset is being licensed to or used by any of
the Companies. Except as set forth in Part 2.9(a)(4) of the
Disclosure Schedule, the Companies have good, valid and
marketable title to all of the Proprietary Assets identified in
Parts 2.9(a)(1) and 2.9(a)(2) of the Disclosure Schedule, free and
clear of all liens and other Encumbrances, and have a valid right
to use all Proprietary Assets identified in Part 2.9(a)(3) of the
Disclosure Schedule. Except as set forth in Part 2.9(a)(5) of the
Disclosure Schedule, none of the Companies is obligated to make
any payment to any Person for the use of any Company Proprietary
Asset. Except as set forth in Part 2.9(a)(6) of the Disclosure
Schedule, the Companies are free to use, modify, copy,
distribute, sell, license or otherwise exploit each of the Company
Proprietary Assets on an exclusive basis (other than Company
Proprietary Assets consisting of software licensed to any of
the Companies under third party licenses generally available to
the public, with respect to which the Companies' rights are not
exclusive).
(b) The Companies have taken reasonable measures and precautions
to protect and maintain the confidentiality and secrecy of all
Company Proprietary Assets (except to the extent the value of
Company Proprietary Assets would be unimpaired by public
disclosure) and otherwise to maintain and protect the value of all
Company Proprietary Assets.
(c) None of the patents, procedures and techniques for column
packing, flow cells and flow splitters, or engineering know-how
for instruments manufactured by LCP NL owned by the Companies
infringes or conflicts with any Proprietary Asset owned or used by
any other Person. To the best of the Shareholders' Knowledge,
none of the other Company Proprietary Assets infringes or
conflicts with any Proprietary Asset owned or used by any other
Person. Except as set forth in Part 2.9(c) of the Disclosure
Schedule, none of the Companies is infringing, misappropriating or
making any unlawful use of, and none of the Companies has at
any time infringed, misappropriated or made any unlawful use of,
or received any notice or other communication of any actual,
alleged, possible or potential infringement, misappropriation or
unlawful use of, any Proprietary Asset owned or used by any other
Person. To the best of the Knowledge of the Shareholders, except
as set forth in Part 2.9(c) of the Disclosure Schedule, no
other Person is infringing, misappropriating or making any
unlawful use of, and no Proprietary Asset owned or used by any
other Person infringes or conflicts with, any Company Proprietary
Asset.
(d) The Company Proprietary Assets enable the Companies to conduct
their business in the manner in which such business has been
conducted. Except as set forth in Part 2.9(d) of the Disclosure
Schedule, (1) none of the Companies has licensed any of the
Company Proprietary Assets to any Person on an exclusive basis and
(2) none of the Companies has entered into any covenant not to
compete or Contract limiting its ability to exploit fully any of
its Proprietary Assets or to transact business in any market or
geographical area or with any Person.
(e) Except as set forth in Part 2.9(e) of the Disclosure Schedule,
(1) all current employees, consultants and independent contractors
of any of the Companies and (2) all former employees, consultants
and independent contractors of any of the Companies who have
ceased to work for any of the Companies within the past two years
have executed and delivered to the Companies written employee
invention assignment and confidentiality agreements (containing
no exceptions to or exclusions from the scope of their coverage).
(f) Except as set forth in Part 2.9(f) of the Disclosure Schedule,
none of the Companies has entered into or is bound by any Contract
under which any Person has the right as of the Effective Time or
thereafter to license, on a commercial basis, any Company
Proprietary Asset including source code, object code, or any
versions, modifications or derivative works of source code or
object code in any Company Proprietary Asset.
(g) All products shipped by any of the Companies since December
31, 1995 are Year 2000 Compliant. Except as disclosed in Part
2.9(g) of the Disclosure Schedule, products shipped by the
Companies prior to such date, still in use and that the Companies
are contractually obligated to make Year 2000 Compliant, are
capable of being made Year 2000 Compliant without the aggregate
cost thereof having a Material Adverse Effect on the Companies.
As used in this Section 2.9(g), "Year 2000 Compliant" means, with
respect to a computer program or other item of software (1) the
functions, calculations, and other computing processes of the
program or software (collectively, "Processes") perform in a
consistent and correct manner without interruption regardless of
the date on which the Processes are actually performed and
regardless of the date input to the applicable computer system,
whether before, on, or after January 1, 2000; (2) the program or
software accepts, calculates, compares, sorts, extracts,
sequences, and otherwise processes date inputs and date values,
and returns and displays date values, in a consistent and correct
manner regardless of the dates used whether before, on, or after
January 1, 2000; (3) the program or software accepts and responds
to year input, if any, in a manner that resolves any ambiguities
as to century in a defined, predetermined, and appropriate manner;
(4) the program or software stores and displays date information
in ways that are unambiguous as to the determination of the
century; and (5) leap years will be determined by the following
standard (A) if dividing the year by 4 yields an integer, it is a
leap year, except for years ending in 00, but (B) a year ending in
00 is a leap year if dividing it by 400 yields an integer.
2.10 Contracts.
(a) Part 2.10(a) of the Disclosure Schedule identifies each
Company Contract that constitutes a "Material Contract." For
purposes of this Agreement, each of the following Company
Contracts shall be deemed to constitute a "Material Contract":
(1) a Company Contract that as of the Effective Time or thereafter
obligates one or more of the Companies, or under which one or more
of the Companies has rights, in an amount or of a value in excess
of USD 50,000;
(2) a Company Contract that as of the Effective Time has a
remaining term of three years or more that may not be terminated
without penalty by whichever of the Companies is a party to the
Contract within three months after the delivery of a termination
notice by such Company;
(3) a Company Contract that both (A) is necessary to enable the
Companies that are parties to the Contract or that are directly
benefited by the Contract to conduct their respective businesses
in the manner in which they are currently being conducted
and (B) could not be replaced promptly on substantially the same
terms without unreasonable effort or expense;
(4) any Contract identified or referred to in Parts 2.9(a), (c),
(d) and (f) of the Disclosure Schedule;
(5) any Contract imposing as of the Effective Time or thereafter
any restriction on the right or ability of any of the Companies
(A) to compete with any other Person, (B) to acquire any product
or other asset or any services from any other Person, to sell any
product or other asset to or perform any services for any other
Person or to transact business or deal in any other manner with
any other Person or (C) to develop or distribute any technology;
and
(6) any Company Contract entered into outside the ordinary course
of business or inconsistent with the Companies' past practices not
completely fulfilled by all parties thereto as of the Effective
Time.
(b) The Companies have delivered to Purchaser accurate and
complete copies of all Material Contracts, including all
amendments thereto. Except as disclosed in Part 2.10(b)
of the Disclosure Schedule, each Material Contract is valid and in
full force and effect, and is enforceable by the Companies that
are parties thereto in accordance with its terms, subject to (1)
laws of general application relating to bankruptcy, insolvency and
the relief of debtors and (2) rules of law governing specific
performance, injunctive relief and other equitable remedies.
(c) Except as set forth in Part 2.10(c) of the Disclosure
Schedule:
(1) none of the Companies has committed any Breach under any
Material Contract and, to the best of the Shareholders' Knowledge,
no other Person has committed any Breach under any Material
Contract, except in either case for Breaches that individually or
in the aggregate would not have a Material Adverse Effect on the
Companies;
(2) to the best of the Shareholders' Knowledge, no event has
occurred, and no circumstance or condition exists, that (with or
without notice or lapse of time) will, or could reasonably be
expected to, (A) result in a Breach of any of the provisions of
any Material Contract, (B) give any Person the right to declare a
default or exercise any remedy under any Material Contract, (C)
give any Person the right to accelerate the maturity or
performance of any Material Contract or (D) give any Person the
right to cancel, terminate or materially modify any Material
Contract, except with respect to Material Contracts referred to in
clauses (A) through (C) where such Breach, default, exercise of a
remedy or acceleration would not have a Material Adverse Effect on
the Companies;
(3) since December 31, 1995, none of the Companies has received
any notice or other communication regarding (A) any actual or
possible violation or Breach of, or default under, any Material
Contract or (B) any actual or possible termination of any Material
Contract; and
(4) none of the Companies has knowingly waived any of its material
rights under any Material Contract.
(d) No Person is renegotiating with the Companies, or has the
right to renegotiate, any amount paid or payable to any of the
Companies under any Company Contract or any other term or
provision of any Company Contract.
2.11 Liabilities.
(a) All liabilities of the Companies of any nature, contingent or
matured, that are required by applicable accounting principles to
be reflected on the respective balance sheets of the Companies or
for which provision is required by such principles to be made on
such balance sheet are so reflected or provision is made therefor
on the balance sheet included in the Annual Statements, except for
(1) accounts payable or accrued salaries that have been incurred
by the Companies since July 31, 2000 in the ordinary course of
business and consistent with past practices; and (2) the
liabilities identified in Part 2.11(a) of the Disclosure Schedule.
(b) Each of the Companies has provided to Purchaser written
information that contains an accurate and complete breakdown of
(1) all accounts payable of each of the Companies as of July 31,
2000 which have not yet been paid in full, (2) all notes payable
of the Companies and all indebtedness of the Companies for
borrowed money which have not yet been paid in full, and (3) all
customer deposits and other deposits held by the Companies as of
July 31, 2000 which have not yet been earned, applied or refunded.
Except as set forth in Part 2.11(b) of the Disclosure Schedule,
all such items are accurately reflected or adequately provided for
on the general ledgers included in the Interim Statements.
(c) None of the Companies has paid, or will become liable for the
payment of, any fees, costs or expenses of the type referred to in
Section 7.3, except as provided therein.
2.12 Compliance with Legal Requirements. To the best of the
Shareholders' Knowledge, each of the Companies is, and has at all
times been, in compliance in all material respects with each Legal
Requirement that is applicable to it or to the conduct of its
business or the ownership of its assets. To the best of the
Shareholders' Knowledge, no event has occurred, and no condition
or circumstance exists, that might (with or without notice or
lapse of time) constitute or result directly or indirectly in a
material violation by any of the Companies of, or a failure on the
part of any of the Companies to comply in all material respects
with any Legal Requirement. Except as set forth in Part 2.12 of
the Disclosure Schedule, since December 31, 1995 none of the
Companies has received any notice or other communication from any
Governmental Body regarding any actual or possible violation of,
or failure to comply with, any Legal Requirement.
2.13 Governmental Authorizations. Part 2.13 of the Disclosure
Schedule identifies each Governmental Authorization held by each
of the Companies, and the Companies have delivered to Purchaser
accurate and complete copies of all written Governmental
Authorizations identified in Part 2.13 of the Disclosure Schedule.
To the best of the Shareholders' Knowledge, the Governmental
Authorizations identified in Part 2.13 of the Disclosure Schedule
are valid and in full force and effect, and collectively
constitute all Governmental Authorizations necessary to enable
each of the Companies to conduct its business in the manner in
which its business is currently being conducted. To the best of
the Shareholders' Knowledge, each of the Companies is and at all
times has been in compliance with the terms and requirements of
its respective Governmental Authorizations identified in Part 2.13
of the Disclosure Schedule. None of the Companies has ever
received any written notice or other formal communication from any
Governmental Body regarding (a) any actual or possible violation
of or failure to comply with any term or requirement of any
Governmental Authorization or (b) any actual or possible
revocation, withdrawal, suspension, cancellation, termination or
modification of any Governmental Authorization.
2.14 Tax and Social Security Filings.
(a) Except as set forth in Part 2.14(a) of the Disclosure
Schedule, the Companies have duly, timely and correctly filed all
Tax Returns required to be filed for all periods as to which the
statute of limitations has not expired ("Company Returns"). The
Companies have delivered to Purchaser accurate and complete copies
of all Tax Returns required to be filed by or on behalf of any of
the Companies with any Governmental Body for every period that is
not a closed period. The Companies have, in respect of Dutch
taxes, delivered to Purchaser accurate and complete copies of the
report on the most recent government tax audit and all notices of
assessment issued after completion of said government tax audit as
well as all Company Returns filed thereafter.
(b) With respect to each of the Companies, other than with respect
to Dutch Taxes, no examination or audit of any Company Return has
been proposed to any of the Companies or scheduled by any
Governmental Body. Except as set forth in Part 2.14(b) of the
Disclosure Schedule, no extension or waiver of the limitation
period applicable to any of the Company Returns has been granted
(by any of the Companies or any other Person), and no such
extension or waiver has been requested from any of the Companies.
(c) Except as set forth in Part 2.14(c) or Part 2.20(a) of the
Disclosure Schedule, no claim or Legal Proceeding is pending or
has been threatened against or with respect to any of the
Companies in respect of any Tax. To the best of the Shareholders'
Knowledge, there are no liens for Taxes upon any of the assets of
any of the Companies, except liens for current Taxes not yet due
and payable.
(d) None of the Companies has entered into any arrangement
(including but not limited to a "ruling") with Tax authorities,
and none is subject to a special arrangement or regime with regard
to Taxes or the payment of Taxes.
(e) The Tax affairs of the Companies have not at any time been
dealt with on a consolidated basis, or any other basis which
allows a combined filing, profit calculation or payment of Tax for
more than one entity or Person.
(f) Each of the Companies is and has been resident for Tax
purposes only in the jurisdiction in which it is incorporated, and
none of the Companies has a permanent establishment, permanent
representative or other taxable presence in any other urisdiction.
None of the Companies constitutes, nor at any time constituted, a
permanent establishment or a permanent representative of another
Person.
2.15 Employee and Labor Matters; Benefit Plans.
(a) Part 2.15(a) of the Disclosure Schedule contains a list of all
employees of each of the Companies as of the date of this
Agreement, and correctly reflects each salary, any other
compensation paid to them from January 1, 2000 through July 31,
2000 and currently payable to them (including compensation payable
pursuant to bonus, deferred or incentive compensation, commission
arrangements), their dates of employment, their dates of birth and
their positions. None of the Companies is, or ever has been, a
party to any company shop agreement or collective bargaining
agreement and no such agreement has been declared
generally applicable by the government.
(b) To the best of the Shareholders' Knowledge, there is no
employee of any of the Companies who, as of the Effective Time,
will not be fully available to perform work because of disability
or other approved absence other than vacation or ordinary sick
time of a brief duration. There is no impediment to the ability
of each of the Companies to terminate the employment of each of
its employees except as may be provided by applicable Legal
Requirements or the individual written contract with the
respective employee. None of the Companies has any employee
manuals and handbooks, disclosure materials, policy statements or
other similar materials relating to the employment of the current
employees of the Companies.
(c) Part 2.15(c) of the Disclosure Schedule identifies each bonus,
deferred compensation, incentive compensation, stock purchase,
stock option, disability, sick pay, severance pay, termination
pay, hospitalization, medical or dental, insurance, supplemental
unemployment benefits, profit-sharing, pension, social security
(government-sponsored or otherwise) or retirement plan, program or
agreement (individually referred to as an " Employee Benefit Plan"
and collectively referred to as the "Employee Benefit Plans")
sponsored, maintained, contributed to or required to be
contributed to by any of the Companies for the benefit of any
current or former employee of any of the Companies, except to the
extent such Employee Benefit Plans are compulsory due to
applicable Legal Requirements.
(d) Except as set forth in Part 2.15(d) of the Disclosure
Schedule, neither the execution, delivery or performance of this
Agreement, nor the consummation of the Purchase or any of the
other transactions contemplated by this Agreement, will result in
any bonus payment, golden parachute payment, severance payment or
other payment to any current or former employee or director of any
of the Companies (whether or not under any Employee Benefit
Plan), or materially increase the benefits payable under any
Employee Benefit Plan, or result in any acceleration of the time
of payment or vesting of any such benefits.
(e) To the best of the Shareholders' Knowledge, the Companies are
in compliance in all material respects with all applicable Legal
Requirements and Contracts relating to employment, employment
practices, employee benefits, employee compensation, wages,
bonuses and terms and conditions of employment.
(f) The Companies have good labor relations, and, except as set
forth in Part 2.15(f) of the Disclosure Schedule, none of the
Shareholders has any Knowledge of any facts indicating that (1)
the consummation of the Purchase or any of the other transactions
contemplated by this Agreement will have, or could reasonably be
expected to have, a Material Adverse Effect on the labor relations
of any of the Companies or (2) any of the key employees of
any of the Companies set forth on Part 2.15(f) of the Disclosure
Schedule (the "Key Employees") intends to terminate his or her
employment with any of the Companies. To the best of the
Knowledge of the Shareholders, no Key Employee is a party to or is
bound by any confidentiality agreement, noncompetition agreement
or other Contract with any Person that may have an adverse effect
on (A) the performance by such Key Employee of any of his duties
or responsibilities as an employee of any of the Companies or (B)
the business or operations of any of the Companies.
2.16 Environmental Matters. To the best of the Shareholders'
Knowledge, each of the Companies and its respective activities are
and have at all times been in compliance in all material respects
with all applicable Environmental Laws. To the actual knowledge
of the Shareholders, each property (including the property
described in Part 2.8(b) of the Disclosure Schedule) that is owned
by, leased to, controlled by or used by any of the Companies, and
all surface water, groundwater, soil and air associated with or
adjacent to such property is free of any environmental
contamination of any nature that as a matter of law must be
removed or that does or will require any action to remedy. To the
best of the Shareholders' Knowledge, none of the Companies has
caused soil pollution, including pollution of the aquatic
sediment, which has not been remedied. To the best of the
Shareholders' Knowledge, each of the Companies possesses all
permits and other Governmental Authorizations required under
applicable Environmental Laws for its business activities, and the
activities of each of the Companies is and has at all times been
in compliance in all material respects with the terms and
requirements of all such Governmental Authorizations. None of the
Companies has received any notice or other communication from a
Governmental Body that alleges that any of the Companies is not in
compliance with any Environmental Law, and, to the best of the
Shareholders' Knowledge, there are no circumstances that could
reasonably be expected to prevent or interfere with the
Companies' compliance with any Environmental Law in the future.
To the actual knowledge of the Shareholders, no current or prior
owner of any property owned, leased or controlled by any
of the Companies has received any notice or other communication
from a Governmental Body that alleges that such current or prior
owner or any of the Companies is not or was not in compliance with
any Environmental Law. All Governmental Authorizations currently
held by any of the Companies pursuant to Environmental Laws are
identified in Part 2.13 or Part 2.16 of the Disclosure Schedule.
For purposes of this Section 2.16, "Environmental Law" means any
applicable international, national, federal, state, provincial,
regional, local, water board, or foreign Legal Requirement
relating to pollution or protection of human health or the
environment (including ambient air, surface water, ground water,
land surface or subsurface strata). None of the Companies has
entered into an agreement with any Governmental Body or
any other party to take any remedial measures with respect to
environmental matters.
2.17 Sale of Products; Performance of Services.
(a) To the best of the Shareholders' Knowledge, each product,
system, program, Proprietary Asset or other asset designed,
developed, manufactured, assembled, sold, installed, repaired,
licensed or otherwise made available by any of the Companies to
any Person conformed and complied in all respects with the terms
and requirements of any applicable warranty or other Contract and
with all applicable Legal Requirements, except for failures to
conform or comply that individually or in the aggregate have not
had and could not reasonably be expected to have a Material
Adverse Effect on the Companies.
(b) To the best of the Shareholders' Knowledge, all installation
services, design services, development services, programming
services, repair services, maintenance services, support services,
training services, upgrade services and other services that have
been performed by any of the Companies were performed properly and
in full conformity with the terms and requirements of all
applicable warranties and other Contracts and with all applicable
Legal Requirements, except for failures to conform or comply that
individually or in the aggregate have not had and could not
reasonably be expected to have a Material Adverse Effect
on the Companies.
(c) Except as set forth in Part 2.17(c) of the Disclosure
Schedule, since December 31, 1995 no customer or other Person has
asserted or threatened to assert any claim against any of the
Companies that constituted or will constitute greater than 5% of
the total warranty claims made in the year such claim was made (1)
under or based upon any warranty provided by or on behalf of any
of the Companies, or (2) under or based upon any other warranty
relating to any product, system, program, Proprietary Asset or
other asset designed, developed, manufactured, assembled, sold,
installed, repaired, licensed or otherwise made available by any
of the Companies or any services performed by any of the
Companies. To the best of the Shareholders' Knowledge, no event
has occurred, and no condition or circumstance exists, that
might (with or without notice or lapse of time) directly or
indirectly give rise to or serve as a basis for the assertion of
any such claim.
(d) Each of the Companies has provided to Purchaser a complete
and accurate copy of the general sales conditions (the "General
Conditions") currently used in the respective business of each.
Except as set forth in Part 2.17(d) of the Disclosure Schedule,
none of the Companies currently uses any sales conditions except
for the General Conditions so provided, and the General Conditions
apply to any and all contracts to which any of the Companies is a
party as seller. Except as set forth in Part 2.17(d) of the
Disclosure Schedule, none of the Companies is a party (as seller)
to any contract that provides the buyer a unilateral right to
cancel the buyer's obligations under the contract or that is
otherwise contingent.
2.18 Insurance. The Companies have delivered to Purchaser
accurate and complete copies of each insurance policy maintained
by, at the expense of or for the benefit of any of the
Companies. Each such insurance policy is in full force and
effect. Since December 31, 1995 none of the Companies has
received any notice or other communication regarding any actual or
possible (a) cancellation or invalidation of any insurance policy,
(b) refusal of any coverage or rejection of any claim under any
insurance policy or (c) material adjustment in the amount of the
premiums payable with respect to any insurance policy other than
adjustments made in the ordinary course of business. To the best
of the Knowledge of the Shareholders, no event has occurred, and
no condition or circumstance exists, that might (with or without
notice or lapse of time) give rise to or serve as a basis for any
claim under any insurance policy maintained by, at the expense of
or for the benefit of any of the Companies.
2.19 Related Party Transactions. Except as set forth in Part 2.19
of the Disclosure Schedule: (a) no Related Party has, and no
Related Party has at any time had, any direct or indirect interest
in any material asset used in or otherwise relating to the
business of any of the Companies; (b) no Related Party is, or has
at any time within the past three years been, indebted to any of
the Companies; (c) no Related Party has entered into, or has had
any direct or indirect financial interest in, any material
Contract, transaction or business dealing involving any of the
Companies; (d) no Related Party is competing, or has at any time
competed, directly or indirectly, with any of the Companies; and
(e) no Related Party has any claim or right against
any of the Companies (other than rights as a shareholder of any of
the Companies and rights to receive compensation for services
performed as an employee of any of the Companies). For
purposes of this Section 2.19, each of the following shall be
deemed to be a "Related Party": any Shareholder, any officer,
director or managing director of any of the Companies, and any
individual, trust, holding company or other Entity that is related
to any of the Shareholders, officers, directors, or managing
directors of any of the Companies.
2.20 Legal Proceedings; Orders.
(a) Except as set forth in Part 2.20(a) of the Disclosure
Schedule, there is no pending Legal Proceeding, other than
collection matters initiated by any of the Companies in the
ordinary course of business for amounts individually less than USD
25,000, and, to the best knowledge of the Shareholders, no Person
has threatened to commence any Legal Proceeding, that: (1)
involves any of the Companies or any of the assets owned or used
by any of the Companies; or (2) that challenges, or that may have
the effect of preventing, delaying, making illegal or otherwise
interfering with, the Purchase or any of the other transactions
contemplated by this Agreement. Except as set forth in Part
2.20(a) of the Disclosure Schedule, no event has occurred, and no
claim, dispute or other condition or circumstance exists, that
will, or that could reasonably be expected to, give rise to or
serve as a basis for the commencement of any such Legal
Proceeding.
(b) Except as set forth in Part 2.20(b) of the Disclosure
Schedule, since December 31, 1995 no Legal Proceeding has been
commenced by, and no Legal Proceeding has been pending against,
any of the Companies.
(c) To the best of the Shareholders' Knowledge, there is no order,
writ, injunction, judgment or decree to which any of the
Companies, or any of the assets owned or used by any of the
Companies, is subject. To the best of the Shareholders'
Knowledge, none of the Shareholders is subject to any order, writ,
injunction, judgment or decree that relates to the Companies'
business or to any of the assets owned or used by any of the
Companies. To the best of the Knowledge of the Shareholders, no
managing director, officer or other employee of any of the
Companies is subject to any order, writ, injunction, judgment or
decree that prohibits such officer or other employee from engaging
in or continuing any conduct, activity or practice relating to the
Companies' business.
(d) Except as set forth in Part 2.20(d) of the Disclosure
Schedule, neither of the Companies is a party to any agreement or
arrangement which contravenes the Competition Act
("Mededingingswet") or which is or should have been registered
under the aforementioned Act or was or should have been notified
to the European Commission under Article 81 of the EC Treaty.
(e) Neither of the Companies has received notice, summons or
official request of any kind from the European Commission or from
the authorities in the Netherlands or in any other country
competent in anti-trust matters, with respect to any aspect of the
Companies' activities.
2.21 Authority; Binding Nature of Agreement.
(a) Each of the Shareholders, severally but not jointly,
represents and warrants that he has the absolute and unrestricted
right, power and authority to enter into and to perform
his obligations under this Agreement and under each other
agreement, document or instrument contemplated by this Agreement
to which he is or will be a party; and the execution and
performance by him of this Agreement and of each such other
agreement, document and instrument have been duly authorized by
all necessary corporate, trust, governmental or other
action.
(b) The Companies have the absolute and unrestricted right, power
and authority to enter into and to perform their obligations under
this Agreement and under each other agreement, document or
instrument contemplated by this Agreement to which any of them
is or will be a party; and the execution and performance by them
of this Agreement and of each such other agreement, document and
instrument have been duly authorized by all necessary
corporate, trust, governmental or other action. This Agreement
and each other agreement, document and instrument contemplated by
this Agreement to which the Companies or any of the
Shareholders is a party constitutes the legal, valid and binding
obligation of such Person or Entity, enforceable against such
Person or Entity in accordance with its terms, subject to (1) laws
of general application relating to bankruptcy, insolvency and the
relief of debtors and (2) rules of law governing availability of
specific performance, injunctive relief and other equitable
remedies.
2.22 Non-Contravention; Consents. Each of the Shareholders,
jointly but not severally, represents and warrants that neither
(i) the execution, delivery or performance of this
Agreement or any other agreement, document or instrument
contemplated by this Agreement nor (ii) the consummation of the
Purchase or any of the other transactions contemplated by this
Agreement or any such other agreement, document or instrument,
will directly or indirectly (with or without notice or lapse of
time):
(a) contravene, conflict with or result in a violation of (1) any
of the provisions of the charter or other governing documents of
any of the Companies or (2) any resolution adopted by the
shareholders, managing directors or board of directors of any of
the Companies;
(b) to the best of the Shareholders' Knowledge, contravene,
conflict with or result in a violation of, or give any
Governmental Body or other Person the right to challenge any
of the transactions contemplated by this Agreement or to exercise
any remedy or obtain any relief under, any Legal Requirement or
any order, writ, injunction, judgment or decree to which
any of the Companies, any of the assets owned or used by any of
the Companies, or any of the Shareholders is subject;
(c) to the best of the Shareholders' Knowledge, contravene,
conflict with or result in a violation of any of the terms or
requirements of, or give any Governmental Body the right to
revoke, withdraw, suspend, cancel, terminate or modify, any
Governmental Authorization that is held by any of the Companies or
that otherwise relates to the business of any of the Companies or
to any of the assets owned or used by any of the Companies;
(d) contravene, conflict with or result in a Breach of, or result
in a default under, any provision of any Company Contract, or give
any Person the right to (1) declare a default or exercise any
remedy under any Company Contract, (2) accelerate the maturity or
performance of any Company Contract or (3) cancel, terminate or
modify any Company Contract; or
(e) to the best of the Shareholders' Knowledge, result in the
imposition or creation of any lien or other Encumbrance upon or
with respect to any of the Shares or any asset owned or used by
any of the Companies (except for minor liens that will not, in
any case or in the aggregate, materially detract from the value of
the assets subject thereto or materially impair the operations of
any of the Companies).
Each of the Shareholders, severally but not jointly, represents
and warrants that, to the best of his or her Knowledge, he or she
neither is nor will be required to make any filing with or
give any notice to, or to obtain any Consent (apart from a Spousal
Consent in the form following the signature pages to this
Agreement) from, any Person in connection with (i) the execution,
delivery or performance of this Agreement or any other agreement,
document or instrument referred to in or contemplated by this
Agreement or (ii) the consummation of the Purchase or any
of the other transactions contemplated by this Agreement or
contemplated by any other agreement, document or instrument
referred to in or contemplated by this Agreement.
To the best of the Shareholders' Knowledge, none of the Companies
is or will be required to make any filing with or give any notice
to, or to obtain any Consent from, any Person in connection with
(i) the execution, delivery or performance of this Agreement or
any other agreement, document or instrument referred to in or
contemplated by this Agreement or (ii) the consummation of the
Purchase or any of the other transactions contemplated by this
Agreement or contemplated by any other agreement, document or
instrument referred to in or contemplated by this Agreement.
2.23 No Brokers.
(a) None of the Companies has agreed or become obligated to pay to
any Person, or has taken any action that might result in any
Person claiming to be entitled to receive, any brokerage
commission, finder's fee or similar commission or fee in
connection with any of the transactions contemplated by this
Agreement.
(b) Each of the Shareholders, severally but not jointly,
represents and warrants that he has not agreed or become obligated
to pay to any Person, or has taken any action that might result in
any Person claiming to be entitled to receive, any brokerage
commission, finder's fee or similar commission or fee in
connection with any of the transactions contemplated by this
Agreement.
2.24 Elimination of Certain Pension Liabilities. The Shareholders
hereby waive any and all rights they may have against any of the
Companies for pension obligations, except to the extent such
obligations arise pursuant to a Legal Requirement or are
compulsory on the part of the Companies under a program sponsored
or administered by a Governmental Body. As of the Effective Time,
any and all such obligations, together with any insurance policies
or other Contracts pertaining to such obligations, have been
terminated or distributed by the Companies to the Shareholders in
their entirety. Any assets so distributed were not of value
greater than the appropriate accruals reflected on the balance
sheet included in the Annual Statements.
2.25 Payments to Shareholders. Part 2.15(a) and Part 2.25 of the
Disclosure Schedule together contain a complete and accurate
description of all payments or distributions of any character made
by any of the Companies to any of the Shareholders (or any other
shareholder of any of the Companies) since December 31, 1999.
2.26 General Release. The Shareholders, both in their capacity of
shareholder and in their capacity of managing director, have
irrevocably and unconditionally waived any claim, whether known or
unknown, matured or unmatured, they may have, on whatever grounds,
against any of the Companies, except for accrued salary and
vacation under the existing service agreements with the
Shareholders and for pension obligations that are not waived under
Section 2.24. No Related Party of any Shareholder has a claim,
known or unknown, matured or unmatured, on whatever grounds,
against any of the Companies.
2.27 Full Disclosure. This Agreement (including the Disclosure
Schedule and the Exhibits hereto but excluding Section 3 hereof)
does not (a) contain any representation, warranty or information
that is false or misleading with respect to any material fact or
(b) omit to state any material fact of which any of the
Shareholders is aware that is necessary in order to make the
representations, warranties and information contained herein (in
light of the circumstances under which such representations,
warranties and information were made or provided) not false or
misleading.
3. REPRESENTATIONS AND WARRANTIES OF PURCHASER.
Purchaser represents and warrants to the Shareholders as follows:
3.1 Authority; Binding Nature of Agreement. Purchaser has the
absolute and unrestricted right, power and authority to perform
its obligations under this Agreement and under each other
agreement, document or instrument contemplated by this Agreement
to which it is or will be a party; and the execution, delivery and
performance by Purchaser of this Agreement have been duly
authorized by all necessary corporate, trust, governmental or
other action on the part of Purchaser and its board of directors.
This Agreement and each other agreement, document and instrument
contemplated by this Agreement to which Purchaser is a party
constitute the legal, valid and binding obligations of Purchaser,
enforceable against it in accordance with their respective terms,
subject to (a) laws of general application relating to
bankruptcy, insolvency and the relief of debtors and (b) rules of
law governing availability of specific performance, injunctive
relief and other equitable remedies.
3.2 Legal Proceedings. There is no pending Legal Proceeding, and
to the best of the Knowledge of Purchaser, no Person has
threatened to commence any Legal Proceeding, that
challenges, or that may have the effect of preventing, delaying,
making illegal or otherwise interfering with, the Purchase or any
of the other transactions contemplated by this Agreement.
3.3 Non-Contravention; Consents. Neither (a) the execution,
delivery or performance of this Agreement or any other agreement,
document or instrument contemplated by this Agreement nor (b) the
consummation of the Purchase or any of the other transactions
contemplated by this Agreement or any such other agreement,
document or instrument, will directly or indirectly (with or
without notice or lapse of time):
(a) contravene, conflict with or result in a violation of (1) any
of the provisions of the charter or other governing documents of
Purchaser or (2) any resolution adopted by the shareholders or
board of directors of Purchaser;
(b) to the best of Purchaser's Knowledge, contravene, conflict
with or result in a violation of, or give any Governmental Body or
other Person the right to challenge any of the transactions
contemplated by this Agreement or to exercise any remedy or obtain
any relief under, any Legal Requirement or any order, writ,
injunction, judgment or decree to which Purchaser , or any of the
assets owned or used by Purchaser , is subject; or
(c) to the best of Purchaser's Knowledge, contravene, conflict
with or result in a violation of any of the terms or requirements
of, or give any Governmental Body the right to revoke, withdraw,
suspend, cancel, terminate or modify, any Governmental
Authorization that is held by Purchaser or that otherwise relates
to the business of Purchaser or to any of the assets owned or used
by Purchaser. Purchaser neither is nor will be required to make
any filing with or give any notice to, or to obtain any Consent
from, any Person in connection with (1) the execution, delivery or
performance of this Agreement or any other agreement, document or
instrument referred to in or contemplated by this Agreement or (2)
the consummation of the Purchase or any of the other transactions
contemplated by this Agreement or contemplated by any other
agreement, document or instrument referred to in or contemplated
by this Agreement, other than a current report on Form 8-K to be
filed with the U.S. Securities and Exchange Commission.
3.4 No Brokers. Purchaser has not agreed or become obligated to
pay to any Person, and has not taken any action that might result
in any Person claiming to be entitled to receive, any brokerage
commission, finder's fee or similar commission or fee in
connection with any of the transactions contemplated by this
Agreement.
3.5 Full Disclosure. This Agreement (excluding Section 2 hereof)
does not (a) contain any representation, warranty or information
provided by Purchaser that is false or misleading with respect to
any material fact or (b) omit to state any material fact of which
Purchaser is aware that is necessary in order to make the
representations, warranties and information provided by Purchaser
herein (in light of the circumstances under which such
representations, warranties and information were made or provided)
not false or misleading.
4. INDEMNIFICATION, ETC.
4.1 Survival of Representations, Etc.
(a) Subject to Sections 4.1(b) and 4.1(c), the representations and
warranties of the Shareholders and Purchaser and the covenants and
obligations of the Shareholders and Purchaser shall survive, inter
alia, the following: (1) the consummation of the transactions
referred to in Section 1; (2) any sale or other disposition of any
or all of the shares of LCP NL Capital Stock or LCP US Capital
Stock; and (3) any merger, combination, split, recapitalization
or similar transaction effected by or otherwise involving
Purchaser or any of the Companies.
(b) Subject to Section 4.1(c) and Section 5.2, the representations
and warranties made by the Shareholders and Purchaser in this
Agreement (including the representations and warranties set forth
in Section 2), the Exhibits hereto and the Disclosure Schedule
shall survive the Effective Time and shall expire on the third
anniversary of the Effective Time; provided, however, that if, at
any time before the third anniversary of the Effective Time, any
Indemnitee (acting in good faith) delivers to the Purchaser (on
behalf of the Purchaser Indemnitors) or the Shareholders' Agent
(on behalf of the Shareholder Indemnitors), as applicable, a
written notice asserting a claim for Damages based on the alleged
existence of a Breach of any of such representations and
warranties, then the claim asserted in such notice shall survive
the third anniversary of the Effective Time until such time as
such claim is fully and finally resolved pursuant to Section 4.3.
(c) The representations and warranties made by the Shareholders in
Sections 2.16 and 2.21 shall survive the Effective Time until the
expiration of the applicable statute of limitations; provided,
however, that if, at any time before the expiration of the
applicable statute of limitations, any Indemnitee (acting in good
faith) delivers to the Shareholders' Agent a written notice
asserting a claim for Damages based on the alleged existence of a
Breach of any of such representations and warranties, then the
claim asserted in such notice shall survive until such
time as such claim is fully and finally resolved pursuant to
Section 4.3. The representations and warranties in Section 2.3
shall survive indefinitely.
(d) For purposes of this Agreement, each statement or other item
of information set forth in the Disclosure Schedule and any
representation and warranty made by the Shareholders in any of the
Exhibits hereto shall be deemed to be a representation and
warranty made by the Shareholders in this Agreement.
(e) For purposes of this Agreement, the term "survive" in
connection with the representations and warranties means that
claims to which the Indemnitees are entitled under this
Agreement shall not be barred by the statute of limitations before
that date on which such representations and warranties expire.
4.2 Indemnification; Setoff.
(a) In the event of a Breach for which the Shareholder Indemnitors
or the Purchaser Indemnitors are obligated to provide
indemnification under this Section 4, such Indemnitors are
obligated to put the Purchaser Indemnitee(s) or the Shareholder
Indemnitee(s), respectively, in the same position in monetary
terms as if the relevant Breach had not occurred.
Accordingly, subject to Section 4.4, from and after the Effective
Time, the Shareholder Indemnitors, to the extent specified in
Section 4.2(c), shall hold harmless and indemnify each of
the Purchaser Indemnitees from and against, and shall compensate
and reimburse each of the Purchaser Indemnitees for, any Damages
that are suffered or incurred by any of such Indemnitees or to
which any of such Indemnitees may otherwise become subject
(regardless of whether or not such Damages relate to any third-
party claim) and that arise from or as a result of, or are
directly connected with: (1) any Breach made by any of the
Shareholders with respect to this Agreement, the Disclosure
Schedule or any of the Exhibits hereto; or (2) any Legal
Proceeding relating to any such Breach. Likewise, subject to
Section 4.4, from and after the Effective Time, the Purchaser
Indemnitors, to the extent specified in Section 4.2(c), shall hold
harmless and indemnify each of the Shareholder Indemnitees from
and against, and shall compensate and reimburse each of the
Shareholder Indemnitees for, any Damages that are suffered or
incurred by any of such Indemnitees or to which any of such
Indemnitees may otherwise become subject (regardless of whether or
not such Damages relate to any third-party claim) and that arise
from or as a result of, or are directly connected with: (1) any
Breach made by the Purchaser with respect to this Agreement or any
of the Exhibits hereto; or (2) any Legal Proceeding relating to
any such Breach.
(b) The Shareholders acknowledge that, if any Purchaser Indemnitee
other than Purchaser suffers or otherwise becomes subject to any
Damages, then Purchaser shall also be deemed to have suffered the
same Damages. Therefore, Purchaser at its sole discretion may
request that indemnification payments be made to Purchaser instead
of such Purchaser Indemnitee.
(c) The liability of the Shareholders under Section 4.2(a) shall
be joint and several. The liability of the Purchaser and the
Companies under Section 4.2(a) shall be joint and several.
(d) In addition to any rights of setoff or other rights that
Purchaser may have at common law or otherwise, Purchaser shall
have the right to set off any amounts payable pursuant to Section
1.6, but only to the extent of the unpaid balance of such amounts
for which the relevant target Turnover Amounts have not been
achieved as of the delivery of the Claim Notice pursuant to
Section 4.3(a), against any amount that may be owed to the
Purchaser Indemnitees under this Section 4.
(e) Nothing contained in this Section 4.2 or elsewhere in this
Agreement shall be deemed to limit any right or remedy of any
Indemnitee with respect to a Breach of Section 6
of this Agreement or any of the Exhibits hereto.
4.3 Procedure for Claims.
(a) If any Indemnitee claims to have incurred or suffered Damages
for which it may be entitled to indemnification under Section 4.2,
such Indemnitee may, on or prior to the expiration of the
applicable survival period set forth in Section 4.1, deliver a
claim notice (a "Claim Notice") to Purchaser (on behalf of the
Purchaser Indemnitors) or the Shareholders' Agent (on behalf of
the Shareholder Indemnitors), as applicable. Each Claim Notice
shall state that such Indemnitee believes that it is entitled to
indemnification under this Agreement and contain a brief
description of the circumstances supporting such Indemnitee's
belief that such Indemnitee is so entitled and shall, to the
extent possible, contain a non-binding, preliminary
estimate of the amount of Damages such Indemnitee claims to have
so incurred or suffered (the "Claimed Amount").
(b) For a period of 20 business days following delivery of the
Claim Notice, Indemnitee and Purchaser (on behalf of the Purchaser
Indemnitors) or the Shareholders' Agent (on behalf of the
Shareholder Indemnitors), as applicable, shall negotiate in good
faith in an attempt to agree upon a settlement of the claim
described in the Claim Notice. If such parties
agree in writing that Indemnitee is entitled to all or any portion
of the Claimed Amount, the Indemnitee shall recover such portion
or all of the Claimed Amount from the Purchaser Indemnitors or the
Shareholder Indemnitors, as applicable.
(c) If Purchaser (on behalf of the Purchaser Indemnitors) or the
Shareholders' Agent (on behalf of the Shareholder Indemnitors), as
applicable, and the Indemnitee are unable to resolve a dispute
relating to all or any portion of the Claimed Amount within 20
business days after the delivery of the Claim Notice, then the
claim described in the Claim Notice shall be
submitted to the state or federal courts in San Francisco,
California, U.S.A. If an Indemnitee obtains a judgment from such
court and no appeal has been timely filed by the party or parties
against whom the judgment has been rendered, Indemnitee shall
recover the amount of such judgment from the Purchaser Indemnitors
or the Shareholder Indemnitors, as applicable.
4.4 Threshold; Ceiling.
(a) Subject to Section 4.4(c), neither the Purchaser Indemnitors,
on the one hand, nor the Shareholder Indemnitors, on the other
hand, shall be required to make any indemnification payment
pursuant to Section 4.2(a) until such time as the total amount of
all Damages (whenever suffered and whether arising from a single
Breach or from multiple Breaches of different representations and
warranties and covenants) suffered by the Shareholder
Indemnitees or the Purchaser Indemnitees, respectively, exceeds
USD 100,000 in the aggregate.
If the total amount of such Damages suffered by the Purchaser
Indemnitees exceeds USD 100,000 in the aggregate, then the
Purchaser Indemnitees shall be entitled to be indemnified against
and compensated and reimbursed for the entire amount of all such
Damages.
If the total amount of such Damages suffered by the Shareholder
Indemnitees exceeds USD 100,000 in the aggregate, then the
Shareholder Indemnitees shall be entitled to be indemnified
against and compensated and reimbursed for the entire amount of
all such Damages.
(b) Subject to Section 4.4(c), the maximum aggregate recovery by
all of the Purchaser Indemnitees for all indemnities together
under Section 4.2(a) shall be limited to the then unpaid balance
of the amounts payable pursuant to Section 1.6 for which the
relevant target Turnover Amounts have not been achieved. The
maximum aggregate recovery by all of the Shareholder Indemnitees
for all indemnities together under Section 4.2(a) shall be limited
to the same amount.
(c) The limitations on indemnification obligations that are set
forth in Sections 4.4(a) and 4.4(b) shall not apply to: (1) any
breach of any of the obligations to pay any of the amounts payable
pursuant to Sections 1.5 and 1.6; (2) any Breach of any of the
representations and warranties set forth in Sections 2.3(a),
2.3(d), 2.3(e) and 2.21; (3) the indemnification obligations set
forth in Section 5.1; (4) any Breach by any Shareholder of any
covenant set forth in Section 4, 5 or 6 of this Agreement; or (5)
fraud.
4.5 No Contribution. Each Shareholder waives, and acknowledges
and agrees that he shall not have and shall not exercise or assert
(or attempt to exercise or assert), any right of contribution,
right of indemnity or other similar right or remedy against any of
the Companies in connection with any actual or alleged Breach of
any representation, warranty or covenant set forth in this
Agreement.
4.6 Defense of Third Party Claims. In the event of the assertion
or commencement by any Person of any claim or Legal Proceeding
(whether against the Companies, against any other Indemnitee or
against any other Person) with respect to which any Indemnitor may
become obligated to indemnify, hold harmless, pay, compensate or
reimburse any Indemnitee pursuant to this Section 4, (a) the
Indemnitee, as soon as practicable after it receives written
notice of any such claim or Legal Proceeding, shall notify
Purchaser (on behalf of the Purchaser Indemnitors) or the
Shareholders' Agent (on behalf of the Shareholder Indemnitors), as
applicable, of such claim or Legal Proceeding (it being understood
that the failure to so notify shall not in any way limit the
rights of such Indemnitee under this Agreement except to the
extent such failure materially prejudices the defenses available
to the applicable Indemnitors), and (b) the Indemnitee shall give
Purchaser (on behalf of the Purchaser Indemnitors) or the
Shareholders' Agent (on behalf of the Shareholder Indemnitors), as
applicable, a reasonable opportunity to defend such claim or Legal
Proceeding at its own expense and with counsel of its own
selection; provided, however, that the Indemnitee shall at all
times also have the right to participate fully in the defense at
its own expense. If Purchaser or the Shareholders' Agent, as
applicable, within a reasonable time after receipt of such notice,
fails to defend, then the Indemnitee may proceed with the defense
of such claim or Legal Proceeding. In such event:
(a) all reasonable expenses relating to the defense of such claim
or Legal Proceeding that are incurred by the Indemnitee shall be
borne and paid exclusively by the Indemnitor(s); provided,
however, that an Indemnitee shall reimburse the Indemnitor(s) for
such expenses to the extent the Indemnitee recovers any payment
for such expenses from the claimant, less any unreimbursed
expenses of such recovery;
(b) the Purchaser Indemnitors or the Shareholder Indemnitors, as
applicable, shall make available to the Indemnitee any documents
and materials in the possession or control of such Indemnitors
that may be necessary to, or that such Indemnitee may reasonably
request in the course of the defense of such claim or Legal
Proceeding;
(c) the Indemnitee shall keep Purchaser (on behalf of the
Purchaser Indemnitors) or the Shareholders' Agent (on behalf of
the Shareholder Indemnitors), as applicable, reasonably informed
of all material developments and events relating to such claim or
Legal Proceeding;
(d) the Indemnitee shall provide the Purchaser (on behalf of the
Purchaser Indemnitors) or the Shareholders' Agent (on behalf of
the Shareholder Indemnitors) or its counsel with all reasonably
requested, non-privileged information and materials related to
such claim or Legal Proceeding;
(e) Purchaser (on behalf of the Purchaser Indemnitors) or the
Shareholders' Agent (on behalf of the Shareholder Indemnitors) or
its counsel shall have the right to attend all meetings with the
Person asserting the claim and all court sessions in the course of
the Legal Proceedings; and
(f) the Indemnitee shall have the right to settle, adjust or
compromise such claim or Legal Proceeding only with the consent of
Purchaser (on behalf of the Purchaser Indemnitors) or the
Shareholders' Agent (on behalf of the Shareholder Indemnitors), as
applicable; provided, however, that such consent shall not be
unreasonably withheld or conditioned.
5. TAX AND OTHER INDEMNIFICATION.
5.1 General. If any Purchaser Indemnitee is held responsible or
liable for the payment of any taxes, late payment charges,
interest on unpaid Taxes, social security dues or any
other public dues or other liabilities vis-a-vis third parties
pertaining to the Companies for the periods up to and including
the Effective Time (hereinafter "Additional Liabilities"), the
Shareholders as joint and several debtors shall at Purchaser's
option:
(a) indemnify the Purchaser Indemnitees against any such
Additional Liabilities, or
(b) pay to the Companies an amount equal to such Additional
Liabilities, to the extent that no commensurate general ledger
provision corresponding to such Additional Liabilities has been
included in the Interim Statements as of July 31, 2000 and to the
extent such amount is not offset by a reduction of Taxes or
interest on net Tax-effected unpaid Taxes in the period beginning
on or after July 31, 2000 directly resulting from such Additional
Liabilities.
5.2 Limitation Period. Claims and rights of the Purchaser
Indemnitees with respect to Tax liabilities, social security
contributions and all other public law dues shall be subject to a
limitation period expiring one year after the end of the fiscal
year in which the relevant decision of the tax authority or other
public authority, as the case may be, has become final and
nonappealable. If any Purchaser Indemnitee decides to make a
claim pursuant to this Section 5, such Indemnitee shall follow the
procedures set forth in Section 4.3 mutatis mutandis.
5.3 Notice of Audits; Cooperation. Purchaser shall inform
Shareholder's Agent of any Tax or other field audit covering any
time up to the Effective Time, permit the Shareholders' Agent and
his legal and tax advisors to attend all relevant meetings with
the authorities and provide all information that the Shareholders'
Agent may reasonably request in connection therewith; provided,
that in each case this is not materially prejudicial to the best
interests of the Companies. Purchaser shall provide that the
relevant Person shall take all reasonable legal remedies
(including litigation) challenging the relevant assessments. In
connection with any such audit, the Shareholders agree to (a)
cooperate fully with Purchaser and the Companies, (b) provide all
information as may reasonably be requested by Purchaser or any of
the Companies, (c) prepare and make available any documents as may
reasonably be requested by Purchaser or any of the Companies, and
(d) take such other actions as may reasonably be requested by
Purchaser or any of the Companies. The costs of compliance with
this Section 5.3 shall be borne by the Shareholders to the extent
they exceed the positive difference, if any, between USD 100,000
and the amount of Damages then suffered by the Purchaser
Indemnitees that could, but for the operation of Section 4.4(a),
recover from the Shareholder Indemnitors.
5.4 Payments. All payments by the Shareholders pursuant to
Section 5.1 shall be made in full without any deduction or
withholding (whether in respect of Taxes, set-off, counterclaim or
otherwise) unless the deduction or withholding is required by law,
in which case the Shareholders shall forthwith pay to the
Purchaser Indemnitees such additional amount as will ensure that
the Purchaser Indemnitees receive a net amount equal to the full
amount which the Purchaser Indemnitees would have received but for
such deduction or withholding. If any payment, including but not
limited to additional amounts payable as a consequence of the
foregoing, received by an Indemnitee under this Section 5.4 is
subject to Tax, the Shareholders shall pay to the Purchaser
Indemnitees such additional amount (after taking into account any
Tax payable in respect of such additional amount) as will ensure
that the Purchaser Indemnitees receive and retain a net amount
equal to the full amount which the Purchaser Indemnitees would
have received and retained had the payment not been subject to
Tax.
6. PROPRIETARY INFORMATION, NONCOMPETITION AND OTHER COVENANTS.
6.1 Acknowledgements. Each of the Shareholders individually
acknowledges and agrees as follows:
(a) Each has occupied a position of trust and confidence with the
Companies prior to the date hereof and has become familiar with or
has had access to the following, any and all of which constitute
confidential information of the Companies (collectively the
"Confidential Information"): (1) any and all trade secrets
concerning the business and affairs of the Companies, 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 and distribution
methods and processes, customer lists, current and anticipated
customer requirements, price lists, market studies, business
plans, computer software and programs (including object code and
source code), computer software and database technologies,
systems, structures and architectures (and related processes,
formulae, compositions, improvements, devices, know-how,
inventions, discoveries, concepts, ideas, designs, methods and
information of the Companies) and any other information, however
documented, of the Companies that is a trade secret within the
meaning of applicable laws; (2) any and all information concerning
the business and affairs of the Companies (which includes
historical financial statements, financial projections and
budgets, historical and projected sales, capital spending budgets
and plans, the names and backgrounds of key personnel, personnel
training and techniques and materials), however documented; and
(3) any and all notes, analysis, compilations, studies, summaries,
and other material prepared by or for the Companies containing or
based, in whole or in part, on any information included in the
foregoing. Confidential Information does not include any of the
foregoing that is in the public domain as of the Effective Time
through no fault of any of the Shareholders;
(b) the business of the Companies is international in scope;
(c) the Companies' products and services are marketed throughout
the world;
(d) the Companies compete with other businesses that are or could
be located in any part of the world;
(e) Purchaser has required that each of them make the covenants
set forth in Sections 6.2 and 6.3 as a condition to Purchaser's
purchase of the Shares; and
(f) the provisions of Sections 6.2 and 6.3 are reasonable and
necessary to protect and preserve the Companies' business.
6.2 No Use of Confidential Information. Each Shareholder
acknowledges and agrees that all Confidential Information known or
obtained by such Shareholder, whether before or after the date
hereof, is the property of the Companies. Therefore, such
Shareholder will not, at any time, disclose to any unauthorized
Persons or use for his own account or for the benefit of any third
party any Confidential Information, whether such Shareholder has
such information in such Shareholder's memory or embodied in
writing or other physical form, without Purchaser's prior written
consent, unless and to the extent that the Confidential
Information is or becomes generally known to and available for use
by the public other than as a result of such Shareholder's fault
or the fault (of which such Shareholder has Knowledge) of any
other Person bound by a duty of confidentiality to Purchaser or
the Companies. Each Shareholder will deliver to Purchaser at the
time of execution of this Agreement, and at any other time
Purchaser may request, all documents, memoranda, notes, plans,
records, reports, and other documentation, models, components,
devices, or computer software whether embodied in a disk or in
other form (and all copies of all of the foregoing), relating to
the businesses, operations or affairs of the Companies and any
other Confidential Information that such Shareholder may then
possess or have under such Shareholder's control.
6.3 Covenants Not to Compete. As an inducement for Purchaser to
enter into this Agreement and as additional consideration for the
obligations of Purchaser under this Agreement:
(a) During the Noncompetition Period (as defined below):
(1) No Shareholder will, directly or indirectly, engage or invest
in, own, manage, operate, finance, control or participate in the
ownership, management, operation, financing or control of, be
employed by, or associated with, lend such Shareholder's name or
any similar name to, lend such Shareholder's credit to, or render
services or advice to, any business insofar as it is engaged in
the business of chromatography, mass spectrometry, proteomics or
any combination thereof or using or developing software related to
chromatography, mass spectrometry or proteomics whose products or
activities compete in whole or in part with the products or
activities of any of the Companies anywhere in the world;
provided, however, that such Shareholder may purchase or otherwise
acquire any class of securities of any enterprise and
exercise all rights with respect to the ownership of such
securities (but without otherwise participating in the activities
of such enterprise) if such securities are listed on any
recognized securities exchange, do not constitute more than 5% of
the class of such securities and are acquired exclusively for
portfolio investment purposes. Each Shareholder acknowledges that
this covenant is reasonable with respect to its duration,
geographical area and scope. Notwithstanding the foregoing, Xxxx-
Xxxxxx Xxxxxxx may continue to own shares of the capital
stock of bai GmbH and participate fully in its activities to the
extent they are consistent with the Company's business activities
as they exist on the date of this Agreement.
(2) No Shareholder will, directly or indirectly, either for
himself or any other Person, (A) induce or attempt to induce any
current or future employee of any of the Companies to leave the
employ of such company, (B) in any way interfere with the
relationship between one of the Companies and any current or
future employee of such company, or (C) induce or attempt to
induce any customer, supplier, licensee or business relation of
any of the Companies to cease doing business or to reduce or
restrict the amount of business done with such company, or in any
way interfere with the relationship between any of the Companies
and any customer, supplier, licensee or business relation of any
of the Companies.
(b) The "Noncompetition Period" for any Shareholder shall commence
at the Effective Time and shall expire upon the earlier to occur
of (1) the fifth anniversary of the Effective Time and (2) the
second anniversary of the termination of the Shareholder's
employment with any of the Companies, if such employment was
terminated by the employer without cause (as defined below);
provided, however, that in the event of a breach by such
Shareholder of any covenant set forth in Section 6.3, the
Noncompetition Period will be extended by the period of the
duration of such breach. For the purposes of this Agreement,
"cause" for termination means (1) conviction of or pleading guilty
or nolo contendere to any felony or any crime involving moral
turpitude or dishonesty, (2) participation in a fraud or act of
dishonesty against Purchaser or any of its subsidiaries, (3)
material breach of the policies of Purchaser or any of its
subsidiaries, (4) intentional material damage to property of
Purchaser or any of its subsidiaries, (5) material breach of any
employment agreement or proprietary information and inventions
agreement between the Shareholder and Purchaser or any of its
subsidiaries or (6) conduct by the Shareholder that, in the
reasonable determination of the Board of Directors of
Purchaser, demonstrates gross unfitness to serve.
(c) No Shareholder will, at any time during or after the
Noncompetition Period, disparage Purchaser or any of the
Companies, or any of their shareholders, directors or officers,
except as may reasonably be necessary or appropriate (1) to defend
him- or herself against any claim, cause of action or demand of
any nature by Purchaser or any of its subsidiaries, or (2) to
assert or otherwise pursue on his or her own behalf a reasonable
claim or reasonable cause of action of any nature against
Purchaser or any of its subsidiaries.
(d) Each of the Shareholders will, during the Noncompetition
Period, within ten days after accepting any employment with any
business that is engaged in the business of chromatography, mass
spectrometry, proteomics or any combination thereof or using or
developing software related thereto, advise Purchaser of the
identity of any employer of such Shareholder. Purchaser or any of
the Companies may serve notice upon each such employer that
such Shareholder is bound by the applicable provisions of Section
6 and furnish each such employer with a copy of relevant portions
thereof.
(e) If any clause of this Section 6.3 is noneffective in law or
incapable of being implemented, wholly or partially, or has
forfeited its legal effectiveness or feasibility subsequent to the
Effective Time, such circumstance shall be without prejudice to
the validity of the remaining clauses of this Section 6.3. The
noneffective or nonimplementable clause is to be substituted by an
appropriate arrangement that, inasmuch as legally possible, most
closely resembles what the parties hereto had intended or,
consistent with the meaning and object of this Section 6.3, would
have intended if such parties had considered such circumstance
when preparing this Section 6.3. This applies particularly if the
nullified clause relates to the Noncompetition Period, in which
case a period of time enforceable in law and most closely
resembling what had been intended is deemed to be agreed to by the
parties.
(f) Notwithstanding the provisions of this Section 6.3, upon a
material Breach by Purchaser of any of its obligations under
Sections 1.5 or 1.6, the Shareholders' obligations under this
Section 6.3 shall expire.
6.4 Rights and Remedies. The rights and remedies of Purchaser
hereunder shall be cumulative (and not alternative). In the event
Purchaser establishes to the satisfaction of a court of competent
jurisdiction a Breach or threatened Breach by a Shareholder of any
covenant, obligation or other provision set forth in this Section
6, Purchaser shall be entitled (in addition to any other remedy
that may be available to either of them) to (a) a decree or order
of specific performance to enforce the observance and performance
of such covenant, obligation or other provision, and (b) an
injunction restraining such Breach or threatened Breach.
Purchaser shall not be required to provide any bond or other
security in connection with any such decree, order or injunction
or in connection with any related action or Legal Proceeding. In
addition, Purchaser shall be entitled to offset against any and
all amounts that may then be owing to such Shareholder under this
Agreement or otherwise any and all amounts that Purchaser may
recover as Damages pursuant to Section 4. The liability of a
Shareholder under this Section 6 shall be several, not joint.
6.5 Other Covenants. Xxxx-Xxxxxx Xxxxxxx, who owns approximately
33.33% of the issued and outstanding capital stock of bai GmbH,
will use his best efforts to cause bai GmbH to continue to
transact business with the Companies on a basis no less favorable
than a basis that is consistent with (i) past course of dealings
between bai GmbH and the Companies, and (ii) transactions
conducted between bai GmbH and third parties.
7. MISCELLANEOUS PROVISIONS.
7.1 Shareholders' Agent.
(a) The Shareholders hereby irrevocably nominate, constitute and
appoint Xxxx-Xxxxxx Xxxxxxx as the agent and true and lawful
attorney-in-fact of the Shareholders (the "Shareholders' Agent"),
with full power of substitution, to act in the name, place and
stead of the Shareholders for purposes of taking any actions in
connection with any and all claims for indemnification because of
a Breach for which the Shareholders may be jointly and severally
liable or with respect to which Purchaser or the Companies may be
entitled to be indemnified ("Indemnification Matters"). Xxxx-
Xxxxxx Xxxxxxx hereby accepts his appointment as
Shareholders' Agent.
(b) Any action taken by the Shareholders' Agent shall be construed
as a valid representation of the Shareholders, only if such action
is documented in writing, such document clearly indicates that
Shareholders' Agent is acting on behalf of the Shareholders and
such document has been signed by the Shareholders' Agent.
Notwithstanding anything to the contrary contained in this
Agreement or the Exhibits hereto: (1) Purchaser and the Companies
shall be entitled to deal exclusively with the Shareholders' Agent
on all Indemnification Matters; and (2) each Indemnitee shall be
entitled to rely conclusively on any document executed or
purported to be executed with respect to any Indemnification
Matter on behalf of any Shareholder by the Shareholders' Agent as
fully binding upon such Shareholder.
(c) The Shareholders recognize and intend that the power of
attorney granted in Section 7.1(a): (1) is coupled with an
interest and is irrevocable; (2) may be delegated by the
Shareholders' Agent; and (3) shall survive the death or incapacity
of each of the Shareholders.
(d) At their discretion, the Shareholders may at any time by
simple majority vote (such majority being determined on the basis
of each Shareholder's interest in LCP NL Capital Stock as set
forth in Recital A) appoint a successor to the Shareholders' Agent
and immediately thereafter notify Purchaser of the identity of
such successor. Any such successor shall succeed the
Shareholders' Agent as Shareholders' Agent hereunder. If for any
reason there is no Shareholders' Agent at any time, all references
herein to the Shareholders' Agent shall be deemed to refer to the
Shareholders.
(e) All expenses incurred by the Shareholders' Agent in connection
with the performance of his duties as Shareholders' Agent shall be
borne and paid exclusively by the Shareholders on whatever basis
they may agree among themselves.
7.2 Further Assurances. Each party hereto shall execute and cause
to be delivered to each other party hereto such instruments and
other documents, and shall take such other actions, as such other
party may reasonably request (at or after the date hereof) for the
purpose of carrying out or evidencing any of the transactions
contemplated by this Agreement.
7.3 Fees and Expenses. Subject to Section 2.11(c), Section 4 and
Section 7.4, each party to this Agreement shall bear and pay all
fees, costs and expenses (including legal fees and accounting
fees) that have been incurred or that are incurred in the future
by such party in connection with the transactions contemplated by
this Agreement, including all fees, costs and expenses incurred by
such party in connection with or by virtue of (a) the negotiation,
preparation and review of this Agreement (including the Disclosure
Schedule) and all agreements, certificates, opinions and other
instruments and documents delivered or to be delivered in
connection with the transactions contemplated by this Agreement,
(b) the preparation and submission of any filing or notice
required to be made or given in connection with any of the
transactions contemplated by this Agreement, and the obtaining of
any Consent required to be obtained in connection with any of such
transactions and (c) the consummation of the Purchase; provided,
however, that no such fees, costs or expenses shall be charged to
or paid by the Companies; provided further, however, that the
fees, costs and expenses that are incurred by the Companies after
the Effective Time to give effect to the transactions contemplated
by this Agreement and that are not a result of a Breach by a
Shareholder shall be borne and paid solely by the Companies.
7.4 Recovery of Litigation Costs. If any Legal Proceeding is
brought to enforce or to interpret this Agreement, then the
prevailing party shall be entitled to reasonable attorneys'
fees, costs and expenses of litigation, in addition to any other
relief to which such party may be entitled.
7.5 Notices. Any notice or other communication required or
permitted to be delivered to any party under this Agreement shall
be in writing and shall be deemed properly delivered and given to
the respective addressee of such notice (or to such other address
or facsimile telephone number as such party shall have specified
in a written notice given to the other parties hereto) when
actually received by such addressee at the following respective
address:
if to Purchaser or the Companies:
Dionex Corporation
000 Xxxxxxx Xxxxx
Xxxxxxxxx, Xxxxxxxxxx 00000
X.X.X.
Attention: A. Xxxxxx Xxxxxx
Facsimile: (000) 000-0000
with a copy to:
Xxxxxx Godward LLP
Xxx Xxxxxxxx Xxxxx, 00xx Xxxxx
Xxx Xxxxxxxxx, Xxxxxxxxxx 00000
X.X.X.
Attention: Xxxxxxxxxxx X. Xxxxxxxx
Facsimile: (000) 000-0000
if to the Shareholders' Agent:
Xxxx-Xxxxxx Xxxxxxx
XX Packings Nederland X.X.
000 Xxxxxxxxxx
0000 XX Xxxxxxxxx, Xxx Xxxxxxxxxxx
Facsimile: 00-00-000-0000
with a copy to
The Xxxxxx Law Firm
000 Xxx Xxxx Xxxxxx, Xxxxx 000
Xxx Xxxxxxxxx, Xxxxxxxxxx 00000-0000
U.S.A.
Attention: Xxxxx X. Xxxxxx
Facsimile: (000) 000-0000
if to any Shareholder (other than with respect to an
Indemnification Matter):
Xxxx-Xxxxxx Xxxxxxx
XX Packings Nederland X.X.
000 Xxxxxxxxxx
0000 XX Xxxxxxxxx, Xxx Xxxxxxxxxxx
Facsimile: 00-00-000-0000
Xxxx-Xxxxxx Xxxxxxxx
00 Xxxxx Xxxxxx
Xxx Xxxxxxxxx, Xxxxxxxxxx 00000
Facsimile: (000) 000-0000
Xxxxxxxx Xxxxxxxx
00 Xxxxx Xxxxxx
Xxx Xxxxxxxxx, Xxxxxxxxxx 00000
Facsimile: (000) 000-0000
Xxxxx Xxxxx
LC Packings Nederland X.X.
000 Xxxxxxxxxx
0000 XX Xxxxxxxxx, Xxx Xxxxxxxxxxx
Facsimile: 00-00-000-0000
7.6 Confidentiality. On and at all times after the Effective Time
(a) each Shareholder shall keep confidential, and shall not use or
disclose to any other Person, any non-public document or other
non-public information in such Shareholder's possession that
relates to the business of the Companies or Purchaser, and (b)
each Shareholder shall continue to keep the terms of this
Agreement and the other agreements, documents and instruments
referred to in or contemplated by this Agreement strictly
confidential. Notwithstanding the foregoing, no Shareholder shall
be deemed to have breached any of the provisions of this Section
7.6 by divulging the terms of this Agreement or of the other
agreements, documents and instruments referred to in or
contemplated by this Agreement (a) to the extent reasonably
required for the preparation and filing of their income tax
returns, (b) in response to an order of a court or other
Governmental Body or (3) pursuant to any other Legal Requirement.
7.7 Headings. The bold-faced section headings contained in this
Agreement are for convenience of reference only, shall not be
deemed to be a part of this Agreement and shall not be referred to
in connection with the construction or interpretation of this
Agreement.
7.8 Governing Law; Venue.
(a) This Agreement (including all Exhibits and Schedules hereto
and the choice of law and place of venue provisions hereof) shall
be construed in accordance with, and governed in all respects by,
the laws of the State of California.
(b) Any legal action or other legal proceeding relating to this
Agreement or the enforcement of any provision of this Agreement
may be brought or otherwise commenced in the state or federal
courts located in San Francisco, California, U.S.A. only. Each
party to this Agreement
(1) expressly and irrevocably consents and submits to the
exclusive jurisdiction of the state and federal courts located in
San Francisco, California, U.S.A. (and each appellate court
located in San Francisco, California, U.S.A.) in connection with
any such legal proceeding; and
(2) agrees not to assert (by way of motion, as a defense or
otherwise), in any such legal proceeding commenced in any state or
federal court located in San Francisco, California, U.S.A., any
claim that such party is not subject personally to the
jurisdiction of such court, that such legal proceeding has been
brought in an inconvenient forum, that the venue of such
proceeding is improper or that this Agreement or the subject
matter of this Agreement may not be enforced in or by such court.
(c) Nothing contained in Section 7.8(b) shall be deemed to limit
or otherwise affect the right of any Indemnitee to commence any
legal proceeding or otherwise proceed against any of the
Indemnitors in any other forum or jurisdiction.
(d) The Shareholders irrevocably constitute and appoint the
Shareholders' Agent as their agent to receive service of process
in connection with any legal proceeding relating to this Agreement
or the enforcement of any provision of this Agreement. Purchaser
shall also promptly deliver copies of any such process to The
Xxxxxx Law Firm, Attention Xxxxx X. Xxxxxx at the address shown in
Section 7.5, with the understanding that The Xxxxxx Law Firm
is not authorized to accept service of process on behalf of the
Shareholders' Agent.
7.9 Successors and Assigns. This Agreement shall be binding upon:
Purchaser, LCP NL, LCP US and their successors and assigns (if
any); and the Shareholders and their respective personal
representatives, executors, administrators, estates, heirs,
successors and assigns (if any). This Agreement shall inure to
the benefit of: Purchaser, LCP NL, LCP US, the Shareholders, the
other Indemnitees, and the respective successors and assigns (if
any) of the foregoing. No party may assign any or all of its
rights under this Agreement (including its indemnification rights
under Section 4), in whole or in part, to any other Person without
obtaining the consent or approval of the other parties hereto;
provided, however, that the Companies may effect such assignment
with the consent or approval solely of the Shareholders'
Agent; and provided, further, that following the Effective Time,
this Agreement and all, but not less than all, of the rights and
obligations of a party hereunder may be assigned without such
consent or approval to a purchaser of all or substantially all of
the assets of such assigning party or to the surviving entity in a
merger (in which such assigning party is not the surviving entity)
by which the surviving entity becomes a successor to such
assigning party and becomes liable for all of such assigning
party's obligations and duties under this Agreement.
Notwithstanding the foregoing, a Shareholder may, without
compliance with the provisions of this Section 7.9,
assign any or all of his or her rights with respect to the payment
of any of the amounts set forth in Section 1.5 and 1.6 (a) by gift
to any parent, spouse, child, grandchild, brother or sister of
such Shareholder or any trustee of a trust established for the
benefit of any of such persons and (b) to such Shareholder's
heirs, legatees, executors or other fiduciaries under such
Shareholder's last will and testament, under the terms of any
trust that takes effect upon the death of such Shareholder or by
intestate succession.
7.10 Waiver.
(a) No failure on the part of any Person to exercise any power,
right, privilege or remedy under this Agreement, and no delay on
the part of any Person, short of the expiration of the applicable
statute of limitations, in exercising any power, right, privilege
or remedy under this Agreement, shall operate as a waiver of such
power, right, privilege or remedy; and no single or partial
exercise of any such power, right, privilege or remedy shall
preclude any other or further exercise thereof or of any other
power, right, privilege or remedy.
(b) No Person shall be deemed to have waived any claim arising out
of this Agreement, or any power, right, privilege or remedy under
this Agreement, unless the waiver of such claim, power, right,
privilege or remedy is expressly set forth in a written instrument
duly executed and delivered on behalf of such Person; and any such
waiver shall not be applicable or have any effect except in the
specific instance in which it is given.
7.11 Amendments. This Agreement may not be amended, modified,
altered or supplemented other than by means of a written
instrument duly executed and delivered on behalf of Purchaser, LCP
NL and the Shareholders.
7.12 Severability. If any provision of this Agreement, or the
application of any such provision to any Person or set of
circumstances, shall be determined to be invalid, unlawful, void
or unenforceable to any extent, the remainder of this Agreement,
and the application of such provision to Persons or circumstances
other than those as to which it is determined to be invalid,
unlawful, void or unenforceable, shall not be impaired or
otherwise affected and shall continue to be valid and enforceable
to the fullest extent permitted by law.
7.13 Parties in Interest. None of the provisions of this
Agreement is intended to provide any rights or remedies to any
Person other than the parties hereto and their respective
successors and assigns (if any).
7.14 Entire Agreement. This Agreement and the other agreements
referred to herein set forth the entire understanding of the
parties hereto relating to the subject matter hereof and
thereof and supersede all prior agreements and understandings
among or between any of the parties relating to the subject matter
hereof and thereof.
7.15 Construction.
(a) For purposes of this Agreement, whenever the context requires:
the singular number shall include the plural, and vice versa; the
masculine gender shall include the feminine and neuter genders;
the feminine gender shall include the masculine and neuter
genders; and the neuter gender shall include the masculine and
feminine genders.
(b) The parties hereto agree that any rule of construction to the
effect that ambiguities are to be resolved against the drafting
party shall not be applied in the construction or interpretation
of this Agreement.
(c) As used in this Agreement, the words "include" and
"including," and variations thereof, shall not be deemed to be
terms of limitation, but rather shall be deemed to be
followed by the words "without limitation."
(d) Except as otherwise indicated, all references in this
Agreement to "Sections" and "Exhibits" are intended to refer to
Sections of this Agreement and Exhibits to this Agreement.
(e) In the event of a conflict between this Agreement and any
translations thereof into languages other than English, this
Agreement shall control.
7.16 Remedies Cumulative; Specific Performance The rights and
remedies of the parties hereto shall be cumulative (and not
alternative). The parties to this Agreement agree that,
in the event of any breach or threatened breach by any party to
this Agreement of any covenant, obligation or other provision set
forth in this Agreement for the benefit of any other party to this
Agreement, such other party shall be entitled (in addition to any
other remedy that may be available to it) to (i) a decree or order
of specific performance to enforce the observance and
performance of such covenant, obligation or other provision, and
(ii) an injunction restraining such breach or threatened breach.
Neither Purchaser nor any other Indemnitee shall be required
to provide any bond or other security in connection with any such
decree, order or injunction or in connection with any related
action or Legal Proceeding.
7.17 Counterparts This Agreement may be executed in several
counterparts, each of which shall constitute an original and all
of which, when taken together, shall constitute one agreement.
[SIGNATURES TO FOLLOW]
The parties hereto have caused this Agreement to be executed and
delivered as of the date
first set forth above.
DIONEX CORPORATION LC PACKINGS NEDERLAND B.V.
\s\A. Xxxxxx Xxxxxx \s\Xxxx-Xxxxxx Xxxxxxx
Name: A. Xxxxxx Xxxxxx Name: Xxxx-Xxxxxx Xxxxxxx
Title: President and Chief Executive Officer Title: President
LC PACKINGS (U.S.A.), INC.
\s\Xxxx-Xxxxxx Xxxxxxxx
Name: Xxxx-Xxxxxx Xxxxxxxx
Title: President
\s\Xxxx Xxxxxx Xxxxxxx
XXXX-XXXXXX XXXXXXX,
as Shareholders' Agent
\s\Xxxx-Xxxxxx Xxxxxxx
XXXX-XXXXXX XXXXXXX
\s\Xxxx-Xxxxxx Xxxxxxxx
XXXX-XXXXXX XXXXXXXX
\s\Xxxxxxxx Xxxxxxxx
XXXXXXXX XXXXXXXX
\s\Xxxxx Xxxxx
XXXXX XXXXX
EXHIBIT A
DEFINITIONS
For purposes of this Agreement (including this Exhibit A):
Additional Liabilities. "Additional Liabilities" shall have the
meaning given to such term in Section 5.1 of this Agreement.
Agreement. "Agreement" shall mean the Stock Purchase Agreement to
which this Exhibit A is attached (including the Disclosure
Schedule), as it may be amended from time to
time.
Annual Statements. "Annual Statements" shall have the meaning
given to such term in Section 2.4 of this Agreement.
Breach. There shall be deemed to be a "Breach" of a
representation and warranty, covenant, obligation or other
provision if there is or has been any inaccuracy in or breach of,
or any failure to comply with or perform, such representation and
warranty, covenant, obligation or other provision and the term
"Breach" shall be deemed to refer to any such inaccuracy, breach,
failure, claim or circumstance.
Cause. "Cause" shall have the meaning given to such term in
Section 6.3(b) of this Agreement.
Charter Documents. "Charter Documents" shall have the meaning
given to such term in Section 2.2(a) of this Agreement.
Claimed Amount. "Claimed Amount" shall have the meaning given to
such term in Section 4.3(a) of this Agreement.
Claim Notice. "Claim Notice" shall have the meaning given to such
term in Section 4.3(a) of this Agreement.
Companies. "Companies" means LC Packings Nederland B.V. and LC
Packings (U.S.A.), Inc.
Company Contract. "Company Contract" shall mean any Contract:
(a) to which any of the Companies is a party; (b) by which any of
the Companies or any of their assets is or may become bound or
under which any of the Companies has, or may become subject to,
any obligation; or (c) under which any of the Companies has or may
acquire any right or interest.
Company Proprietary Asset. "Company Proprietary Asset" shall mean
any Proprietary Asset owned by or licensed to any of the Companies
or otherwise used by any of the Companies.
Company Return. "Company Return" shall have the meaning given to
such term in Section 2.14(a) of this Agreement.
Confidential Information. "Confidential Information" shall have
the meaning given to such term in Section 6.1(a) of this
Agreement.
Consent. "Consent" shall mean any approval, consent,
ratification, permission, waiver or authorization (including any
Governmental Authorization).
Contract. "Contract" shall mean any written, oral or other
agreement, contract, subcontract, lease, understanding,
instrument, note, warranty, insurance policy, benefit plan, or
legally binding commitment or undertaking of any nature.
Damages. "Damages" shall include any loss, damage, injury,
decline in value, lost opportunity, Liability, settlement,
judgment, award, fine, penalty, Tax, fee (including reasonable
attorneys' fees), charge, cost (including costs of investigation)
or expense of any nature.
Disclosure Schedule. "Disclosure Schedule" shall mean the
schedule (dated as of the date of this Agreement) delivered to
Purchaser on behalf of the Shareholders.
Effective Time. "Effective Time" shall have the meaning given to
such term in Section 1.1 of this Agreement.
Employee Benefit Plan. "Employee Benefit Plan" shall have the
meaning given to such term in Section 2.15(c) of this Agreement.
Encumbrance. "Encumbrance" shall mean any lien, pledge,
hypothecation, charge, mortgage, security interest, encumbrance,
infringement, option, right of first refusal, preemptive right,
community property interest or restriction of any nature
(including any restriction on the voting of any security, any
restriction on the transfer of any security or other asset, any
restriction on the receipt of any income derived from any asset,
any restriction on the use of any asset and any restriction on the
possession, exercise or transfer of any other attribute of
ownership of any asset).
Entity. "Entity" shall mean any corporation (including any non-
profit corporation), general partnership, limited partnership,
limited liability partnership, limited liability corporation,
joint venture, estate, trust, company (including any limited
liability company or joint stock company), firm or other
enterprise, association, organization or entity.
Environmental Law. "Environmental Law" shall have the meaning
given to such term in Section 2.16 of this Agreement.
General Conditions. "General Conditions" shall have the meaning
given to such term in Section 2.7(d) of this Agreement.
Governmental Authorization. "Governmental Authorization" shall
mean any: (a) permit, license, certificate, franchise,
permission, clearance, registration, qualification or
authorization issued, granted, given or otherwise made available
by or under the authority of any Governmental Body or pursuant to
any Legal Requirement; or (b) right under any Contract with
any Governmental Body.
Governmental Body. "Governmental Body" shall mean any: (a)
nation, xxxxx, xxxxxxxxxxxx, xxxxxxxx, xxxxxx, xxxxxxxxx, county,
municipality, district, water board, or other jurisdiction or
group of jurisdictions of any nature; (b) international, national,
federal, state, provincial, regional, local, municipal, foreign or
other government; or (c) international, national, governmental or
quasi-governmental authority of any nature (including any
governmental division, department, agency, commission,
instrumentality, official, organization, unit, body or
Entity and any court or other tribunal).
Indemnification Matters. "Indemnification Matters" shall have the
meaning given to such term in Section 7.1(a) of this Agreement.
Indemnitees. "Indemnitees" shall mean the Shareholder Indemnitees
and the Purchaser Indemnitees.
Indemnitors. "Indemnitors" shall mean the Shareholder Indemnitors
and the Purchaser Indemnitors.
Interim Statements. "Interim Statements" shall have the meaning
given to such term in Section 2.4 of this Agreement.
Key Employee. "Key Employee" shall have the meaning given to such
term in Section 2.15(f) of this Agreement.
Knowledge. An individual shall be deemed to have "Knowledge" of a
particular fact or other matter if: (a) such individual is
actually aware of such fact or other matter; or (b) a prudent
individual could be expected to discover or otherwise become aware
of such fact or other matter in the course of conducting a
reasonable investigation concerning the truth or existence of such
fact or other matter. Purchaser shall be deemed to have
"Knowledge" of a particular fact or other matter if any director
or executive officer of Purchaser has Knowledge of such fact or
other matter.
LCP NL. "LCP NL" shall mean LC Packings Nederland B.V., a private
company with limited liability under the laws of the Netherlands.
LCP NL Capital Stock. "LCP NL Capital Stock" shall have the
meaning given to such term in Recital A of this Agreement.
LCP US. "LCP US" shall mean LC Packings (U.S.A.), Inc., a
California corporation.
LCP US Capital Stock. "LCP US Capital Stock" shall have the
meaning given to such term in Recital A of this Agreement.
Legal Proceeding. "Legal Proceeding" shall mean any action, suit,
litigation, arbitration, proceeding (including any civil,
criminal, administrative, investigative or appellate proceeding),
hearing, inquiry, audit, examination or investigation commenced,
brought, conducted or heard by or before, or otherwise involving,
any court or other Governmental Body or any arbitrator or
arbitration panel.
Legal Requirement. "Legal Requirement" shall mean any
international, national, federal, state, provincial, regional,
local, municipal, foreign or other law, statute, constitution,
principle of common law, resolution, ordinance, code, edict,
decree, rule, regulation, ruling or requirement issued, enacted,
adopted, promulgated, implemented or otherwise put into effect by
or under the authority of any Governmental Body.
Liability. "Liability" means any debt, obligation, duty or
liability of any nature (including any unknown, undisclosed,
unmatured, unaccrued, unasserted, contingent, indirect,
conditional, implied, vicarious, derivative, joint, several or
secondary liability), regardless of whether such debt, obligation,
duty or liability would be required to be disclosed on a balance
sheet prepared in accordance with applicable accounting principles
and regardless of whether such debt, obligation, duty or liability
is immediately due and payable.
Material Adverse Effect. A violation or other matter will be
deemed to have a "Material Adverse Effect" on the Companies if
such violation or other matter (considered together with all other
matters that would constitute exceptions to the representations
and warranties set forth in this Agreement but for the presence of
"Material Adverse Effect" or other materiality qualifications, or
any similar qualifications, in such representations and
warranties) would have a material adverse effect on the business,
condition, assets, liabilities, operations, financial performance
or prospects of the Companies, taken as a whole.
Material Contract. "Material Contract" shall have the meaning
given to such term in Section 2.10 of this Agreement.
Noncompetition Period. "Noncompetition Period" shall have the
meaning given to such term in Section 6.3 of this Agreement.
Person. "Person" shall mean any individual, Entity or
Governmental Body.
Processes. "Processes" shall have the meaning given to such term
in Section 2.9(g) of this Agreement.
Proprietary Asset. "Proprietary Asset" shall mean any: (a)
patent, patent application, trademark (whether registered or
unregistered), trademark application, trade name, fictitious
business name, service xxxx (whether registered or unregistered),
service xxxx application, copyright (whether registered or
unregistered), copyright application, trade secret, know-how,
customer list, franchise, system, computer software, source code,
computer program, invention, design, blueprint, engineering
drawing, proprietary product, technology, proprietary right or
other intellectual property right or intangible asset; or (b)
right to use or exploit any of the foregoing.
Purchase. "Purchase" shall have the meaning given to such term in
Section 1.1 of this Agreement.
Purchaser. "Purchaser" shall mean Dionex Corporation, a Delaware
corporation.
Purchaser Indemnitees, Purchaser Indemnitors. "Purchaser
Indemnitees" and "Purchaser Indemnitors" shall both mean (a)
Purchaser; (b) any of the Companies; and (c) the
respective successors and assigns of the Persons referred to in
clauses (a) and (b) above.
Related Party. "Related Party" shall have the meaning given to
such term in Section 2.19 of this Agreement.
Representatives. "Representatives" shall mean officers,
directors, employees, agents, attorneys, accountants, advisors and
representatives.
Shareholder Indemnitees, Shareholder Indemnitors. "Shareholder
Indemnitees' and "Shareholder Indemnitors" shall both mean the
following Persons: (a) the Shareholders and (b) the respective
successors and assigns of the Persons referred to in clauses (a)
above.
Shareholders. "Shareholders" shall have the meaning given to such
term in the opening paragraph of this Agreement.
Shareholders' Agent. "Shareholders' Agent" shall have the meaning
given to such term in Section 7.1(a) of this Agreement.
Shares. "Shares" shall have the meaning given to such term in
Section 1.1 of this Agreement.
Subsidiaries. "Subsidiaries" shall mean the entities listed in
Section 2.1(d) of the Disclosure Schedule.
Tax. "Tax" shall mean any tax (including any corporate, trade or
other income tax, franchise tax, capital gains tax, gross receipts
tax, value-added tax, surtax, excise tax, ad valorem tax, transfer
tax, stamp tax, sales tax, use tax, property tax, business tax,
withholding tax or payroll tax), social security contributions,
employee social security contributions, levy, assessment, tariff,
duty (including any customs duty), deficiency or fee, and any
related charge or amount (including any fine, penalty or
interest), levied, imposed, assessed or collected by or
under the authority of any Governmental Body.
Tax Return. "Tax Return" shall mean any return (including any
information return), report, statement, declaration, estimate,
schedule, notice, notification, form, election, certificate
or other document or information filed with or submitted to, or
required to be filed with or submitted to, any Governmental Body
in connection with the determination, assessment,
collection or payment of any Tax or in connection with the
administration, implementation or enforcement of or compliance
with any Legal Requirement relating to any Tax.
Turnover. "Turnover" shall have the meaning given to such term in
Section 1.6 of this Agreement.
Year 2000 Compliant. "Year 2000 Compliant" shall have the meaning
given to such term in Section 2.9(g) of this Agreement.
