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EXHIBIT 10.3
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SHARE PURCHASE AGREEMENT
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BY AND BETWEEN
XXXXX XXXXXX AND OTHERS
AND
MRV COMMUNICATIONS INC.
RELATING TO THE SHARES
OF
JOLT LTD.
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DATED 14TH APRIL 2000
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TABLE OF CONTENTS
ARTICLE
I. SALE AND PURCHASE OF THE SHARES
1.1 Sale and Purchase of the Shares....................................
1.2 Closing............................................................
1.3 Purchase Price.....................................................
1.4 Certain Definitions................................................
II. CONDITION PRECEDENT TO OBLIGATION OF BUYERS TERMINATION
2.1
2.2 Deliveries and Proceedings at Closing .............................
2.3 Termination Prior to Closing ......................................
2.4 Fulfillment of Conditions and Agreements Prior to Closing..........
III. REPRESENTATIONS AND WARRANTIES OF THE SELLER
3.1 Corporate Organization.............................................
3.2 Capitalization: Title to Shares....................................
3.3 Subsidiaries.......................................................
3.4 Authorization and Validity of Agreement............................
3.5 No Conflict or Violation...........................................
3.6 Accounts and Related Matters.......................................
3.7 Governmental Approvals.............................................
3.8 Actions and Proceedings............................................
3.9 Taxes..............................................................
3.10 Real and Personal Property.........................................
3.11 Intellectual Property..............................................
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3.12 Outstanding Commitments............................................
3.13 Compliance with Law................................................
3.14 Environmental Compliance...........................................
3.15 Employment Matters.................................................
3.16 Insurance..........................................................
3.17 Bank Accounts......................................................
3.18 Disclosure.........................................................
IV. REPRESENTATIONS AND WARRANTIES OF THE BUYER
4.1 Corporate Organization.............................................
4.2 Authorization and Validity of Agreement............................
4.3 No Conflict or Violation...........................................
4.4 Governmental Approvals.............................................
V. COVENANTS OF THE SELLER
5.1 Ordinary Course of Business........................................
5.2 Access and Information.............................................
VI. ADDITIONAL AGREEMENTS
6.1 Approval by the Anti Trust Commissioner............................
6.2 Other Approvals....................................................
VII. REPAYMENT AND INDEMNIFICATION OBLIGATIONS
7.1 Repayment Obligations of the Seller................................
7.2 Survival or Representations........................................
7.3 Indemnification by Seller..........................................
7.4 Indemnification by Buyer...........................................
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7.5 Notice of Claims...............................................
7.6 Third Party Claims.............................................
7.7 Company Liability..............................................
7.9 Time for Claims................................................
VIII. MISCELLANEOUS
8.1 Publicity......................................................
8.2 Further Assurances ............................................
8.3 Offset Assignment..............................................
8.4 Schedules......................................................
8.5 Amendment and Waiver: Cumulative Effect........................
8.6 Severability ..................................................
8.7 Financial Advisors, Brokers and Finders........................
8.8 Cost and Expenses.............................................. 15
8.9 Notices........................................................
8.10 Entire Agreements..............................................
8.11 No Third Party Rights Assignment...............................
8.12 Transfer Taxes.................................................
8.13 Governing Law..................................................
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SHARE PURCHASE AGREEMENT
THIS SHARE PURCHASE AGREEMENT, dated as of April 14, 2000 (as the same may be
amended, supplemented or otherwise modified from time to time in accordance with
its terms, this "Agreement"), Between:
1) XXXXXX - AMISHAV YAEL Israeli I.D. No.011816816
2) XXXXXX, XXXXXXXX
3) XXXXXX, XXXXX Israeli I.D. No.000148825
4) XXXXXX, XXXXXXXX Israeli I.D. No.011180346
5) XXXXXX, XXXXX
6) XXXXXX, XXXXXXX
x/x Xxxxx Xxxxxx, Xxxxxxxx
0 Xxxxxxx Xx.
Xxx Xxxx
jointly and severally (the "Seller" or "the "Sellers")
OF THE FIRST PART
AND
JOLT LTD
a company registered under the laws of Israel
Registration Number 51-157359 having its registered office
At 0 Xxxxxxxx xx. Xxx Xxxxxxx, Xxxxxxxxx Xxxxxx (the "Company")
OF THE SECOND PART
AND
MRV COMMUNICATIONS INC.
00000 Xxxxxxxx Xxxxxxxxxx
Xx, 00000 X.X.X.
(the "Buyer" or "MRV")
OF THE THIRD PART
WHEREAS the Sellers are the owners of 5,546,200 issued regular shares
nominal value 0.01 each of the capital stock (the "Shares") of
the Company (as per the list enclosed to this Agreement and
marked A), having a share capital of 240,000 New Israeli Shekel.
The List of all Shareholders holding shares and/or options and/or
Warrants of the Company is enclosed to this Agreement and marked
"A1": and
WHEREAS subject to the terms and conditions hereinafter set forth, the
Seller desires to sell, the Shares to the Buyer and cause all the
other shareholders of the Company to sell to the Buyer all the
Shares of the Company held by them and the Buyer desires to
Purchase the Shares and also to purchase all the Shares held by
all the other shareholders of the Company: and
WHEREAS the Company agrees to register the Shares in the name of the
Buyer as well as to register any additional Shares Purchased by
Buyer in his name immediately after the Closing as hereinafter
defined:
NOW, THEREFORE, THE PARTIES HERETO HEREBY AGREE AS FOLLOWS:
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ARTICLE I
SALE AND PURCHASE OF THE SHARES
1.1 SALE AND PURCHASE OF THE SHARES.
Upon the terms and subject to the conditions set forth in this
Agreement, at the Closing (as such term is defined in Section 1.2
below):
a) The Sellers shall sell to the Buyer the Shares and shall
cause other shareholders of the Company (the "Other Selling
Shareholders") to sell to the Buyer an aggregate amount of
Shares that together with the Shares will total not less
then 80% (eighty percent) of the issued Shares of the
Company (the Shares together with the balance of the shares
of the Company totaling 80% of the issued shares of the
Company, to be sold to the Buyer at the closing-the "Sold
Shares"). The Sold Shares will be sold to the Buyer and the
Buyer shall purchase from the Seller and the Other Selling
Shareholders, the Sold Shares free and clear of all liens
as defined in Section 1.4(c) below and together with all
rights now and hereafter attaching thereto;
This sale and purchase transaction is subject to the
conditions set forth in Article II.
1.2 CLOSING.
a) The closing of the sale and purchase of the Shares and the
Sold Shares (the "Closing") shall be held at the offices of
Eckhaus, Talmor, Shilo, Dichno, Attorneys At Law, 3 Xxxxxx
Xxxxxx St. Tel-Aviv or at such other location as shall be
mutually agreed by the parties, at 11:00 A.M. on April
27th, 2000, or such other time and date as the Buyer may
designate in writing at his sole discretion, but not later
than May 27st. 2000. The date on which the Closing occurs
is hereinafter referred to as the "Closing Date".
b) At the Closing:
(i) the parties shall exchange the documents referred to
in this Agreement including the documents referred
to in Articles ii and vi.
(ii) the Sellers and the Other Selling Shareholders shall
deliver to the Buyer duly executed Share
Certificates and Share Transfer Deeds for all of the
Sold Shares, sufficient to convey to the Buyer good
title to the Sold Shares free and clear of all liens
and the Buyer shall pay the Share Purchase Price (as
defined in Section 1.3 below) to the Seller and to
the Other Selling Shareholders by handing over to
the Seller and to the Other Selling Shareholders,
Share Certificates to the "MRV Shares" as
hereinafter defined.
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(iii) all matters at the Closing will be considered to
take place simultaneously, and no delivery of any
document will be deemed complete until all
transactions and deliveries of documents required by
this Agreement are completed.
1.3 PURCHASE PRICE.
The aggregate consideration to be paid to all the Shareholders of
the Company for all the issued Shares of the Company provided all
of the issued Shares of the Company are sold to the Buyer shall be
U.S. $ 42,500,000 (fourty two million and five hundred thousand
U.S. Dollars) (the "Share Purchase Price"). The Share Purchase
Price will decrease pro rata in the event that less than a 100% of
the issued Shares of the Company will be sold to the Buyer. The
Share Purchase Price shall be payable as follows:
a) The pro rata Share of the Purchase Price to be paid to each
one of the Sellers will be paid solely by the issuance by
MRV to each one of the Sellers at the closing of an amount
of Shares of the Common Stock of MRV (the "MRV Shares")
totaling in value U.S. $ 4.2146 (four U.S. Dollars and
twenty one point forty six cents) for each share of the
Company transferred to MRV with the number of such MRV
Shares (the "PP Shares") to be computed on the basis of the
average Closing Price of the MRV Shares reported on Nasdaq
for the five (5) business days immediately preceding the
execution of this Agreement.
b) The amount of U.S. $ 4.2146 (four U.S. Dollars and twenty
one point forty six cents) per share of the Company
transferred in accordance with this Agreement in MRV Shares
will be paid to the Sellers and the other Shareholders of
the Company that will transfer to the Buyer their shares
pro-rata with the amount of Shares of the Company
transferred by each Shareholder to MRV.
c) In the event that the Closing Price of the MRV Shares on
the date of registration of the PP Shares with the
Securities and Exchange Commission (as such date is defined
in this Agreement) when multiplied by the number of the PP
Shares will equal less than U.S. $ 4.2146 (four U.S.
Dollars and twenty one point forty six cents) but more than
U.S $ 3.2388 (three U.S. $ Dollars and twenty three eighty
eight cents) the Buyer will issue to the Shareholders that
have transferred their shares to the Buyer an additional
amount of MRV Shares (the "AD Shares") that together with
the PP Shares will equal in value (based on the Closing
Price of the MRV Shares on the date of registration) as
close an amount as possible to U.S. $ 4.2146 (four U.S.
Dollars and twenty one point forty six cents) per share of
the Company transferred to the Buyer without having to
issue any fractional interests in shares.
d) In the event that the Closing Price of the MRV Shares on
the date of Registration of the PP Shares with the
Securities and Exchange Commission when multiplied by the
number of the PP Shares will equal less than U.S. $ 3.2388
(three U.S. $ and twenty three eighty eight cents) per
Share of the
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Company, MRV will not issue any additional MRV Shares other
than the AD Shares described in Section 1.3 (c) and the
issuance of the PP Shares and the AD Shares to the
Shareholders that have transferred their shares in the
Company to the Buyer will be considered payment of the full
Purchase Price to the Sellers and to the other Shareholders
that have transferred their shares to the Buyer.
e) Seller hereby acknowledges, represents, warrants, and
covenants as follows:
(i) The MRV shares to be issued to the Seller and to any
other selling Shareholders, have not been registered
under the United States Securities Act of 1933, as
amended (the "Act"), and are not freely tradable.
The MRV Shares must be held, unless either a
registration statement with respect to the MRV
Shares is filed and declared effective under the
Act, or an exemption from the registration
requirement of the Act is available.
(ii) MRV Shares are being acquired for investment for
receipients own account and not with a view to sale
or resale, to distribute (as that term is defined in
the Act) transfer, or to offers in connection
therewith. When the MRV Shares have been purchased
and issued to a person pursuant to this Agreement no
other person will have a beneficial interest in the
Shares.
(iii) MRV will affix a legend in substantially the
following form to the certificates evidencing the
MRV Shares:
"The securities represented by this certificate have
not been registered under the Securities Act of
1933, as amended, and may not be sold, pledged,
hypothecated, donated, or otherwise transferred,
whether or not for consideration, unless either the
shares have been registered under said Act or an
exemption from such registration requirement is
available. If the shares are to be sold or
transferred pursuant to an exemption from the
registration requirement, the Company may require a
written opinion of counsel, satisfactory to counsel
for Company, to the effect that registration is not
required and that such transfer will not violate
said Act or applicable state securities law".
f) Shortly after the closing date, MRV shall file, and shall
use its best efforts to cause to become effective, under
the Act, a Registration Statement (the "Registration
Statement"), which shall provide for the resale to the
public of any and all of the Registered Shares by each one
of the Selling Shareholders in such manner as the Sellers
shall specify to MRV in writing. At all times beginning
upon the effectiveness of the Registration Statement and
ending at such time as the Sellers shall have sold or
otherwise disposed of all of the Registered Shares, MRV
shall use its best efforts to maintain the Registration
Statement in effect and shall use its best efforts to cause
the prospectus contained therein (the "Prospectus") to be
and remain current. So that (i) such Prospectus shall at no
time contain an untrue statement of a material fact or omit
to state a material fact required so as not to be
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misleading and (ii) the Sellers may, in accordance with
applicable law, make public offers, sales and other
distributions of all of the Registered Shares by means of
the Prospectus.
g) The Sellers and all other Shareholders receiving shares of
MRV shall indemnify and hold MRV harmless (and every person
which shall be deemed to control MRV) from and against any
loss, cost, damage or expense of any nature whatsoever
which such indemnified party may suffer or incur in the
event that the Registration Statement (including the
Prospectus) shall at any time contain an untrue Statement
of a material fact or omit to state a material fact
required to be stated therein not or necessary to make the
Statement therein not misleading to the extent, but only to
the extent, that such untrue statement or alleged untrue
statement or omission or alleged omission was made in
reliance upon and in conformity with written information
relating to the Sellers and the Other Shareholders selling
their shares to the Buyer or their plan of distribution
furnished to MRV for use in the preparation thereof.
1.4 CERTAIN DEFINITIONS.
As used in this Agreement, the following terms have the meanings
given to them below:
a) "Accounting Principles" means generally accepted accounting
principles in the U.S.A.
b) "Affiliate" when used with respect to another person or
entity shall mean any person or entity controlling,
controlled by, or under common control with such person or
entity:
c) "Liens" means all liens, mortgages, charges, security
interests, burdens, encumbrances or other restrictions or
limitations of any nature whatsoever:
d) The Phrase "best knowledge of the Seller", or words to that
effect, shall mean the knowledge of the members of the
Board of Directors of the Seller and the executive
management employees of the Seller after reasonable inquiry
of the executive management of the Companies:
e) Unless the context would require otherwise, the term
"Material Adverse Effect" shall be measured with respect to
the entire business of the Company taken as a whole, as
such business is being conducted on the Closing Date. The
Seller may, however, at its option, include in the Schedule
hereto items which would not have a Material Adverse Effect
within the meaning of the immediately preceding sentence in
order to avoid any misunderstanding, and such inclusion
shall not be deemed to be an acknowledgment by the Seller
that such items would have a Material Adverse Effect or to
further define the meaning of such term for purposes of
this Agreement.
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ARTICLE II
CONDITION PRECEDENT TO OBLIGATION OF BUYERS` TERMINATION
2.1 The obligations of Buyer to proceed with the Closing is subject to
the fulfillment prior to or at Closing of the conditions set forth
in this Section. Any one or more of these conditions may be waived
in whole, or in part, by Buyer at Buyer's sole option:
a) Sellers shall have caused all but not less then 80% of the
Shareholders of the Company to sign this Agreement and to
transfer to Buyer at least 80% of the issued shares of the
Company free and clear of any liens or encumbrances.
b) Sellers shall have tendered to Buyer at Closing a document
signed by each one of the shareholders of the Company
waiving his right of first refusal to purchase shares of
the Company from any shareholder of the Company (if there
is any)and a declaration signed by the Company's attorney
that all rights of first refusal under the Company's
articles of incorporation have been waived.
c) Seller shall have notified in writing all the shareholders
of the Company of the execution of this Agreement by Seller
and the Company and shall have offered all the shareholders
of the Company to sell their shares to the Buyer and to
execute this Agreement.
d) The Company shall have paid a payment on account to "Bank
Le Pituah Hatasia Ltd." (the "Bank") and shall have
received a written confirmation from the Bank that all the
debts of the Company to the Bank - Long Term together with
Short Term, are not higher than 2,700,000 N.I.S.
e) Seller and the Company have obtained the approval of the
Anti Trust Commissioner to the sale of shares and to the
other Contemplated Transactions under this Agreement.
f) Seller and the Company have obtained the approval of the
Chief Scientist ("Madan Rashi") to the sale of shares and
to the other Contemplated Transactions under this
Agreement.
g) Seller and the Company have settled to the full
satisfaction of the Buyer all law suits now pending against
the Company.
h) Seller and the Company have received all Governmental or
other approvals necessary for the transfer of shares and to
the other Contemplated Transactions under this Agreement.
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i) Each one of the Sellers, the Additional Sellers and the
Company shall have performed all of the agreements complied
with all of the provisions required by this Agreement to be
performed or complied with by such party at or before
Closing Date.
j) No legal requirements shall be in effect that prohibits or
threatens to prohibit the Contemplated Transactions or that
would limit or adversely affect Buyer's ownership of the
Shares or control of the Company or the business. No Legal
Proceeding shall be pending, threatened or challenging the
lawfulness of the Contemplated Transactions, seeking to
prevent or delay any of the Contemplated Transactions or
seeking relief by reason of the Contemplated Transactions.
Neither Seller, the Company or Buyer shall have received
any claim by any person (written or oral) asserting that
the person other than Seller and/or the Shareholders listed
in Schedule "A1" is the holder or beneficial owner of, or
has the right to acquire or obtain beneficial ownership of,
the Shares or any equity interest or right in the Company,
(ii) has any Encumbrance on or Security Rights in the
Shares, or (iii) is entitled to all or any portion of the
Purchase Price.
k) Between the date of this Agreement and the Closing Date,
there shall have been no material adverse change,
regardless of insurance coverage, in the business or any of
the assets, results of operations, liabilities, prospects
or condition, financial or otherwise, of the Company.
l) Seller shall have delivered a certificate, dated as of the
Closing Date, in a form satisfactory to Buyer certifying to
the fulfillment of the conditions set forth in Section 2.2.
The contents of the certificate shall constitute a
representation and warranty of Seller and the Company as of
the Closing Date and shall be deemed relied upon by Buyer
and fully incorporated in this Agreement.
m) The Company and each party to this Agreement shall have
received all Required Authorizations under any applicable
Legal Requirements necessary to consummate the Contemplated
Transactions. The Company shall also have received all
Required Authorizations.
n) Buyer shall have completed to its satisfaction its business
and legal due diligence investigation of the Company, its
property and Business.
o) Buyer shall also have received the other documents referred
to in Section 3. All certificates, opinions and other
documents delivered by Seller or the Company to Buyer under
this Agreement shall be satisfactory to Buyers in form and
substance.
p) Xxxxx Xxxxxx shall have entered into a Non-Competition and
Non-Solicitation Agreement for a period of 3 years with
Buyer.
q) Seller and Additional Sellers shall have entered into a
stock restriction agreement with Buyer.
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r) Buyer's Board of Directors shall have authorized Buyer to
enter into, and shall have approved this Agreement and the
Contemplated Transactions.
s) The representations and warranties of Seller and the
Company contained in this Agreement shall be accurate and
complete, individually and collectively, in all material
respects (i) as of the date of this Agreement and (ii) as
of the Closing Date as if made on the Closing Date.
2.2 DELIVERIES AND PROCEEDINGS AT CLOSING
a) Seller and other Selling Shareholders shall deliver to
Buyer at the Closing:
(i) Certificates representing the Shares, free of all
Encumbrances, duly endorsed in negotiable form or
accompanied by stock powers duly executed in blank,
and signed share transfer Deeds with signatures
witnessed by an Attorney, a Notary, or a witness.
(ii) Certificates signed by the Company's Attorney dated
not more than 2 days prior to Closing Date to the
effect that the Company is a validly existing
corporation.
(iii) Certificate of the Attorney of the Company (A)
setting forth all resolutions of the Board of
Directors of the Company authorizing the execution
and delivery of this Agreement and the performance
by the Company of the Contemplated Transactions, and
(B) stating that the Governing Documents of the
Company were in effect on the date of adoption of
those resolutions, the date of execution of this
Agreement and the Closing Date.
(iv) General releases by Seller, and all directors and
officers of the Company of all Liability of the
Company to them and of any claim that they, or any
of them, may have against the Company.
(v) The minute books, stock certificate book and
transfer ledgers certified to correct by the
Company's Attorney and corporate seal of the
Company.
(vi) Resignations of the officers and directors of the
Company and resignations of all authorized
signatories to all of the bank and other depository
and investment accounts of the Company, effective as
of the Closing Date.
(vii) Such other agreements and documents specified in
this Agreement and as Buyer may reasonably request.
b) Buyer shall deliver or cause to be delivered to Seller, at
the Closing:
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(i) A stock certificate for the unvested shares due to
Sellers and to the other Selling Shareholders in
accordance with Section 1.3 registered in the name
of the Seller or according to his order, shall be
delivered to Xxxxx Xxxxxx, Advocate, as escrow
agent, pursuant to the terms of this Agreement.
2.3 TERMINATION PRIOR TO CLOSING
a) EVENTS OF TERMINATION. This Agreement may be terminated in
writing at any time prior to the Closing by: (i) the mutual
consent of Buyer, Seller and the Company; (ii) Buyer, if
any of the conditions specified in Section 2.1 and 2.2
shall not have been fulfilled (or if satisfaction becomes
impossible) on or before the Closing Date and shall not
have been waived by Buyer; (iii) by Buyer, if a material
breach of any provision of this Agreement has been
committed by Seller or the Company and such breach has not
been cured or waived by Buyer; (iv) by Seller, if a
material breach of any provision of this Agreement has been
committed by Buyer and such breach has not been cured or
waived by Seller.
b) CONSEQUENCES OF TERMINATION. If this Agreement is
terminated by mutual consent of the parties, no party shall
have any obligation to any other party as a result of that
termination. If any party terminates this Agreement for any
reason other than as described in Section 2.3 (a) Buyer, on
the one hand, and Seller and the Company, on the other
hand, shall be liable to the other for any breach of this
Agreement by such party which breach led to such
termination. Each party shall also be entitled to any other
remedy to which it may be entitled at law or in equity,
including injunctive relief and specific performance. All
rights and obligation of the parties set forth in Section
8.1 shall survive termination of this Agreement.
Notwhithstanding the above, Seller can not terminate this
Agreement even if the Closing date will be postponed by
Buyer at Buyer's sole discretion provided such postponement
will not exceed 30 days..
2.4 FULFILLMENT OF CONDITIONS AND AGREEMENTS PRIOR TO CLOSING
Each party shall satisfy all of those conditions to the
obligations of the other under this Article II, on or prior to the
Closing Date. Each party shall cooperate with the other and take,
or cause to be taken, all action and do, or cause to be done, all
things necessary, proper or advisable, including making or
obtaining any and all Required Authorization, to consummate and
make effective the Contemplated Transactions.
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ARTICLE III
REPRESENTATIONS AND WARRANTIES OF THE SELLER
The Seller hereby represents and warrants to and for the benefit of the Buyer as
follows:
3.1 CORPORATE ORGANIZATION.
The Company is a company duly incorporated and validly existing
under the laws of Israel, and has all requisite corporate power
and authority to own its respective properties and assets and to
conduct its respective businesses as now being conducted. True and
complete copies of the Organizational Documents of the Company, as
amended to the date hereof, are attached hereto as Schedule 3.1.
3.2 CAPITALIZATION: TITLE TO SHARES.
a) The capital of the Company consists of 24,000,000 shares,
nominal value N.I.S 0.01 per share, out of which 10,083,900
are validly issued and fully-paid after all vested Options
and Warrants are exercised.. The Shares are the only
outstanding interests in the capital of the Company, and
there are no outstanding subscriptions, options, conversion
rights, warrants, preemptive rights or other agreements
providing for the purchase, issuance or sale of any
interests in the capital of the Company, other than as
contemplated by this Agreement.
b) Each one of Sellers is the lawful owner of the Shares
listed next to his name in Annex A, free and clear of all
Liens. Each one of the Sellers has, or will have at
Closing, full legal right, power and authority to sell,
assign, transfer and convey the Shares in accordance with
the terms and subject to the conditions of this Agreement.
3.3 SUBSIDIARIES.
Except Air Optics Inc. which is registered in the State of
Dellawere U.S.A. the Company does not own, either directly or
indirectly, any shares or equity interests in any other legal
entity.
3.4 AUTHORIZATION AND VALIDITY OF AGREEMENT.
The execution and delivery of this Agreement and the performance
of the Seller's obligations hereunder have been duly authorized by
and on behalf of the Seller if such authorization is necessary
under any law and no other corporate proceeding on the part of the
Sellers which are incorporated is or will be necessary to
authorize such execution, delivery and performance, This Agreement
has been duly executed and delivered by the Seller and, assuming
due authorization, execution and delivery by the Buyer,
constitutes the valid and binding obligation of the Seller
enforceable against the Seller in accordance with its terms and
the Seller has entered into no other agreement with another third
party providing for the sale of the Shares.
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3.5 NO CONFLICT OR VIOLATION.
Neither the execution and delivery of this Agreement, nor the
performance by the Seller of its obligations hereunder, nor the
consummation of the transactions provided for hereby, does or
will:
(i) conflict with or violate any provision of the articles of
incorporation or similar governing documents
("Organizational Documents") of any of the Sellers or the
Company:
(ii) results in the cancellation, modification, revocation, or
suspension of any permits, authorizations, approvals,
registrations and licenses granted by or obtained from any
governmental, administrative or regulatory authority
("Permits") issued or granted to the Company:
(iii) result in the creation of any Liens upon any of the
respective properties or assets of the Company: or
(iv) constitute a violation by the Seller or the Company of any
applicable laws, rules or regulations of any governmental,
administrative or regulatory authority ("Laws") applicable
to it or any judgments, orders, decrees, rulings or awards
of any court, arbitrator or other judicial authority or any
governmental, administrative or regulatory authority
("Judgments") applicable to it.
3.6 ACCOUNTS AND RELATED MATTERS.
a) Schedule 3.6(a) sets forth true and complete copies of the
balance sheets and statements of income of the Company for
the period ending June 30 1999, together with the related
schedules and notes as certified by Someh Hiekin CPA (the
"June 1999 Accounts") and the un-audited balance sheets for
the fiscal year ending December 31 1999 (December 1999
Accounts"). Except as indicated therein, the June 1999
Accounts and the December 1999 accounts were prepared in
accordance with the Accounting Principles consistently
applied, and present fairly in all material respects the
financial condition of the Company as of December 31 1999.
The Seller undertake to cause the Company to hand over to
MRV not later than June 30 2000 a complete copy of the
audited balance sheets and statements of income of the
Company for the fiscal year ending December 31, 1999
("December 31, 1999 audited accounts").
The Seller and the Company hereby represent to Buyer that
the December 31, 1999 audited accounts will not be
different in all material respects from the December 1999
accounts.
b) Since December 31 1999 through the date hereof, (I) the
Company has conducted its business only in the ordinary
course in substantially the same manner as therefore
conducted, and has not taken any of the actions described
in subparagraphs (I) through (vii) of Section 5.1 of this
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Agreement that would have required the consent of the Buyer
if such action were to be taken between the date hereof and
the Closing Date.
c) Except as set forth on Schedule 3.6 (c), since December 31
1999, the Company has not (I) declared or paid any
dividends, or (ii) paid or accrued any management or
similar fees to or in favor of any Persons, other than
severance payments to Geptah Xxxxx.
3.7 GOVERNMENTAL APPROVALS.
No consent, waiver. approval, authorization, exemption,
registration, license or declaration of or by, or filing with, any
governmental, administrative or regulatory authority
("Governmental Approval") other than described in this Agreement
is required to be made or obtained by the Seller or the Company,
in connection with the execution and delivery of this Agreement by
the Seller and the Company or the performance by the Seller of its
obligations hereunder. Other then the authorization described in
this Agreement which the Seller and the Company undertake to apply
for immediately after the execution of this Agreement.
3.8 ACTIONS AND PROCEEDINGS.
As of the date hereof, there is no action, suit, claim or legal,
administrative, arbitration or other alternative dispute
resolution proceeding or investigation (each, a "Proceeding" and
collectively, "Proceedings") pending or, to the best knowledge of
the Seller, threatened in writing against the Company or, with
respect to the transactions contemplated herein, against Seller,
other then the proceedings described in Schedule 3.8. the Company
is not subject to any Judgment that has a Material Adverse Effect
or would interfere with the transactions contemplated by this
Agreement.
3.9 TAXES.
As of the date hereof: (I) the Seller and the Company have filed
on a timely basis all returns and reports in respect of taxes for
which the Company may be liable: (ii) all taxes required to be
paid by the Company that were due and payable prior to the date
hereof have been paid: (iii) there are no pending audits or
investigations or pending or, to the best knowledge of the Seller,
threatened claims relating to taxes for which the Company may
become liable: and (iv) no deficiencies for any taxes have been
assessed against the Company which remain unpaid. As used in this
Agreement, "tax or taxes" shall mean all taxes, assessments and
governmental charges of any kind, whether payable directly or by
withholding, including without limitation, income, property,
sales, customs, value added, employment and social security taxes
and charges, together with any interest, penalties or additions to
tax with respect thereto, imposed by any governmental authority.
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All Taxes imposed by Law on the Seller or the Company in
connection with the transactions under this Agreement including
(but not limited to) V.A.T. on the Purchase Price (if due) income
tax on the Purchase Price etc. will be paid by the Seller and or
any other Selling Shareholder.
3.10 REAL AND PERSONAL PROPERTY.
a) The Company does not own Real Property.
b) Schedule 3.10 (b) sets forth an accurate and complete list
of all real property leased by the Company. Except as set
forth on Schedule 3.10 (b
c) Schedule 3.10 (c) sets forth a true and complete copy of
the assets of the Company as of March 31, 2000, listing all
material items of machinery, equipment and other tangible
personal property (collectively "Machinery and Equipment")
owned by the Company as of such date.
3.11 INTELLECTUAL PROPERTY.
Schedule 3.11 sets forth a true and complete list of all
intellectual property patents, copyrights, trademarks, service
marks and trade names owned by or registered in the name of the
Company.
3.12 OUTSTANDING COMMITMENTS.
Schedule 3.12 sets forth an accurate and complete list of all of
the following written Contracts (other than any such Contracts
reflected in other Schedules to this Agreement) to which the
Company is a party and has any express obligations continuing as
of the date hereof:
(i) loan agreements, guarantee agreements, mortgages, security
agreements and other documents or written arrangements
relating to the borrowing of money or for lines of credit
(other than intercompany loans and indebtedness):
(ii) working capital maintenance, comfort letters or other forms
of guaranty agreements in respect of a third party
obligation:
(iii) contracts or commitments limiting or restricting the
Company from engaging in or competing in any line of
business or with any person, firm or company:
(iv) partnership or joint venture agreements:
(v) agreements with related parties ("Baalei Inian" and "Nosei
Misra") as such term is defined under the Israeli Company
Xxx 0000 and the Israeli Securities Law 1968.
(vi) agreements relating to third party technology, know-how or
processes which the Company is licensed or authorized to
use: and
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(vii) any other contract or agreement made in the ordinary course
of business pursuant to which annual payments in excess of
U.S. $ 50,000 may reasonably be expected to be made.
(viii) any other contract or agreement made other than in the
ordinary course of business pursuant to which annual
payments in excess of $ 10,000 may reasonably be expected
to be made: (the foregoing Contracts being referred to
collectively as the "Outstanding Commitments" and
individually as an "Outstanding Commitment"). As of the
date hereof, there have been no claims made, or to the best
knowledge of the Seller, threatened relating to the
validity or enforceability of any of the Outstanding
Commitments. As of the date hereof, neither the Seller nor
the Company has received written notice that any party to
any of the Outstanding Commitments intends to cancel or
terminate any Outstanding Commitment.
3.13 COMPLIANCE WITH LAW.
To the best knowledge of the Seller, the operations of the Company
has been conducted in all material respects in accordance with all
applicable Laws and Judgments, Neither the Seller nor the Company
has received written notice of any violation of any such Law or of
any default with respect to any Judgment applicable to the Company
or to any of its respective assets, properties of operations. The
Companies have all Permits required for the conduct of its
businesses, except where failure to have such Permit would not
have a Material Adverse Effect.
3.14 ENVIRONMENTAL COMPLIANCE.
To the best knowledge of the Seller, the operations of the Company
has been conducted in all material respects in accordance with all
applicable Laws regulating emissions, discharges or wastes in the
environment (including without limitation ambient air, surface
water, ground water or land) or otherwise regulating the
manufacturing, processing, distribution, use, treatments, storage,
disposal, transport or handling of pollutants, contaminates,
chemicals or toxic or hazardous substances or wastes or
environmental protection (collectively referred to as
"Environmental Laws"). Neither the Seller nor the Company has
received written notice from any governmental authority of any
material violation of any Environmental Laws.
3.15 EMPLOYMENT MATTERS.
a) Schedule 3.15 (a) sets forth (I) an accurate and complete
list as of the date hereof of all directors of the Company,
and (ii) an accurate and complete list of the collective
bargaining agreements applicable to the Company employees.
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b) Schedule 3.15 (b) sets forth (I) the number of employees
employed by the Company as of March 31st, 2000, and (ii) a
complete list of all employees of the Company entitled as
of the date hereof to an annual salary or other
compensation in excess of New Shekels 50,000 (the "Listed
Employees"). All employment and severance contracts,
arrangements or policies pertaining to the employees of the
Company comply in all material respects with all applicable
requirements of Law, and, except to the extent set forth on
Schedule 3.15 (b), none of such contracts, arrangements or
policies pertaining to the Listed Employees are more
favorable than the applicable Collective Agreements
(Heskemim Kibutziim), or the applicable requirements of Law
in any material respect.
c) Since December 31st 1999, the Company did not (I) pay or
agree to pay any bonuses or made or agreed to make any
increase in the rate of wages, salaries or other
remuneration of any of its directors or employees other
than in the ordinary course of business and in a manner
consistent with past practice or as dictated by applicable
Law or the applicable collective Agreements, or (ii)
changed its hiring or termination policies or practices in
any material respect.
d) Except as set forth on Schedule 3.15 (d), to the best
knowledge of the Seller, as of the date hereof there are no
plans or arrangements providing for "Pizuiei Piturim"
insurance coverage, disability benefits, vacation benefits,
retirement benefits, deferred compensation, profit sharing,
stock options or other form of post retirement benefits
covering directors or employees or former directors or
employees of the Companies which provide for any individual
or collective terms and conditions of employment that are
more favorable than the applicable collective Agreements,
or the applicable requirements of Law in any material
respect.
e) To the best knowledge of the Seller, as of the date hereof
there are no contracts, agreements, plans or arrangements
covering directors or employees or former directors or
employees of the Companies which contain any "change of
control" or similar provisions.
3.16 INSURANCE.
Schedule 3.16 sets forth a complete list of the insurance policies
currently in effect under which any of the Companies is an insured
party. To the best knowledge of the Seller, the insurance
maintained by the Companies is valid and enforceable in accordance
with its terms, is in full force and effect, and insures against
such risks and liabilities as are substantially consistent with
customary practices and standards of companies engaged in similar
businesses in Israel.
3.17 BANK ACCOUNTS.
Schedule 3.17 sets forth a complete list of the names of each bank
or other financial institution in which the Company has an
account, and the names of all persons authorized to operate such
account.
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3.18 DISCLOSURE.
The Seller has not knowingly withheld from the Buyer any fact with
respect to the Company which the Seller believes would change in
any material way to meaning of all or part of the declaration set
forth in this Article II, including without limitation the
Schedules attached hereto.
ARTICLE IV
REPRESENTATIONS AND WARRANTIES OF THE BUYER
The Buyer represents and warrants to and/or the benefit of to the Seller as
follows:
4.1 CORPORATE ORGANIZATION.
The Buyer is a company duly organized and validly existing under
the laws of its country or state of incorporation. The Buyer has
the corporate power and authority to enter into this Agreement and
to carry out its obligations hereunder.
4.2 AUTHORIZATION AND VALIDITY OF AGREEMENT.
The execution and delivery of this Agreement and the performance
of the Buyer's obligations are subject to the approval of MRV's
Board of Directors and no other corporate proceeding other then
such approval will be necessary to authorize such execution,
delivery and performance. This Agreement if approved by MRV's
Board of Directors and assuming due authorization execution and
delivery by the Seller and the Company, constitutes a legal, valid
and binding obligation of the Buyer, enforceable against it in
accordance with its terms.
4.3 NO CONFLICT OR VIOLATION.
Neither the execution and delivery of this Agreement, nor the
performance by the Buyer of its obligations hereunder, nor the
consummation of the transactions provided for hereby, does or will
(I) conflict with or violate any provision of the Organizational
Documents of the Buyer: (ii) violate, conflict with or result in
the breach or termination of any Contracts or Permits to which the
Buyer is a party or by which any of it or its securities,
properties or assets are bound: (iii) result in the creation of
any Liens upon any of its securities, properties or assets, or
(iv) constitute a violation by the Buyer of any Laws or Judgments
applicable to it: except, in each such case, for such any such
matters that would not, either individually or in the aggregate,
adversely effect the ability of the Buyer to perform its
obligations under this Agreement.
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4.4 GOVERNMENTAL APPROVALS.
No Governmental Approval is required to be made or obtained by the
Buyer, in connection with the execution and delivery of this
Agreement by the Buyer or the performance by the Buyer of its
obligations hereunder, other than the receipt of the approval of
the Israeli Anti Trust Commissioner.
ARTICLE V
COVENANTS OF THE SELLER
5.1 ORDINARY COURSE OF BUSINESS.
During the period from the date of this Agreement to the Closing,
except as specifically contemplated by this Agreement or as
otherwise consented to in writing by the Buyer: (a) the Seller
will ensure that the Company carries on its business only in the
ordinary course in substantially the same manner as heretofore
conducted: and (b) the Seller will not permit of the Company to:
(i) amend its Organizational Documents:
(ii) acquire, by merger, consolidation, purchase of stock or
assets or otherwise, any corporation, partnership,
association or other business organization:
(iii) alter its outstanding capital stock or declare, set aside,
make or pay and dividend or other distribution in respect
of its capital stock (in cash or otherwise), or purchase or
redeem any shares of its capital stock:
(iv) issue or sell (or agree to issue or sell) any of its
capital stock or any options, warrants or other rights to
purchase any such shares or any securities convertible into
or exchangeable for such shares:
(v) grant any general increase in the remuneration and benefits
of the Companies' employees or make any other material
change in the level or remuneration of such employees or in
the Companies' employment polices:
(vi) incur, other than in the ordinary course of business
consistent with past practice, any material indebtedness
for borrowed money (including through the issuance of debt
securities) or vary in any material manner the terms of any
material existing indebtedness:
(vii) make any change in its accounting procedures or practices
unless mandated by generally accepted accounting
principles: or
(viii) agree to take any of the actions set forth in the foregoing
subsections (I) through (vi).
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5.2 ACCESS AND INFORMATION.
During the period from the date of this Agreement to the Closing
(or the earlier termination of this Agreement), the Seller shall
permit the Buyer and its representatives reasonable access during
normal business hours to the premises and the books and records of
the Company, provided that such access shall not interfere with
the normal business and operations of the Company.
ARTICLE VI
ADDITIONAL AGREEMENTS
6.1 APPROVAL BY THE ANTI TRUST COMMISSIONER.
The Closing of the Sale and purchase of shares is conditioned upon
the receipt of the approval of the Anti Trust Commissioner or its
Ruling that such approval is not necessary under Law. The Buyer
and the Seller will exercise their best efforts to obtain, as soon
as reasonably practicable, the approval of the Israeli Anti Trust
Commissioner to the transaction described in this Agreement. The
failure to receive such approval will not give rise to any claim
by the Buyer or Seller provided both parties will exercise their
best efforts to receive such approval.
6.2 OTHER APPROVALS
The Seller undertakes to secure at or before closing all other
approvals and consents necessary for the transfer of shares under
this Agreement and for all such other Contemplated Transactions
under this Agreement.
6.3 The Seller will call or cause to be called shortly after the
execution of this Agreement a meeting of the, its Board of
Directors and a General Meeting of the Shareholders of the Company
and will present to all such organs of the Company the
transactions contemplated under this Agreement including the
details of the Option Agreement he intends to sign with the Buyer
as well as all other details of his interests in the Transactions
with the Buyer and will hand over to the Buyer the minutes of the
the Board of Directors and the General Meeting of Shareholders
certified to be true and correct by the Company's Attorney.
Receipt of the approval of the Board of Directors of the Company
described in this section 6.3 is a condition precedent to Closing.
6.4 Sellers undertake to notify all Shareholders of the Company of the
Execution of this Agreement and to cause to registered
Shareholders of the Company holding together at least 80% of the
issued Share Capital of the Company to execute this Agreement and
transfer their shares to the Buyer at Closing in accordance with
the terms of this Agreement. The execution of this Agreement by
registered Shareholders holding at least 80% of the issued Share
Capital of the Company is a condition precedent to Closing by
Buyer that can be waived by Buyer at Buyer's sole discretion.
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6.5 The Purchase Price and the form of payment described in Section
1.3 are the Purchase Price and payment for all the shares of the
Company subject to the terms and conditions of this Agreement. The
Buyer will deposit at Closing with Xxxxxx Xxxxx, Advocate the pro
rata MRV Shares to be transferred to any Shareholder of the
Company that will not transfer his shares to the Buyer at the
Closing (The " Non Transferring Shareholders"). Advocate Xxxxxx
Xxxxx will hand over a pro rata share certificate to the MRV
Shares to each one of the Not Transferring Shareholders that will
execute this Agreement and transfer his shares in the Company to
the Buyer after the Closing but not later than 90 days past the
Closing date. All MRV Shares remaining with Advocate Xxxxxx Xxxxx
91 days after the Closing will be returned to Buyer upon Buyer's
written request and the Buyer will have no further obligations to
purchase any shares of the Company from the Non Transferring
Shareholders after 91 days from the day of Closing have past.
ARTICLE VII
REPAYMENT AND INDEMNIFICATION OBLIGATIONS
7.1 REPAYMENT OBLIGATIONS OF THE SELLER.
From and after the Closing the Seller and all Additional Sellers
that have transferred their shares in the Company to the Buyer
undertake to pay to the Buyer as a partial repayment of the
Purchase Price (i) any amount of money owed by the Company to any
party which was not described or disclosed to Buyer under this
Agreement (ii) any amount of money owed by the Company under any
judgment rendered against the Company before or after the Closing
which remains unpaid at the date of Closing or after closing
together with all other related costs any such repayment will be
first done from the amount deposited referred to in Article 7.8.
7.2 SURVIVAL OR REPRESENTATIONS
All representations, warranties, covenants and obligations made by
any party in this Agreement shall survive the Closing. Any
limitation or qualification set forth in any one representation
and warranty shall not limit or qualify any other representation
and warranty. The right to indemnification under this Section or
any other remedy based on the breach or inaccuracy of any
representation or warranty in this Agreement or breach of, or
noncompliance with, any covenant or obligation in this Agreement
will not be affected by any investigation conducted with respect
to, or any knowledge acquired (or capable of being acquired) at
any time, whether before or after the execution and delivery of
this Agreement or the Closing Date, with respect to any such
representation, warranty covenant or obligation. The waiver by any
party of any condition at Closing or the breach or inaccuracy of
any representation or warranty, or breach of, or noncompliance
with, any covenant or obligation, will not affect the right of
such party to
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indemnification, payment of damages or other remedy based on such
breach, inaccuracy or noncompliance.
7.3 INDEMNIFICATION BY SELLER
Seller, and all Other Selling Shareholders, , shall indemnify,
defend, save and hold harmless Buyer and its officers, directors,
employees, agents and Affiliates (including, after the Closing,
the Company: each, a "BUYER INDEMNITEE") from and against all
damages directly or indirectly asserted against, imposed upon,
resulting to, or incurred or required to be paid by any Buyer
Indemnitee up to the pro rata share of the consideration received
by each one of the Sellers and Other Selling Shareholders pursuant
to this Agreement from or in connection with:
a) any material breach or inaccuracy of any representation or
warranty made by Seller or the Company in this Agreement,
in any supplement to the Schedules, in any certificate or
document delivered by Seller or the Company in connection
with this Agreement or any other agreement to which Seller
or the Company, or both, is or is to become a party:
b) any material breach or nonperformance of any covenant or
obligation made by Seller or the Company in or in
connection with this Agreement or any other agreement to
which Seller or the Company, or both, is or is to become a
party:
c) any product shipped or manufactured by, or any services
provided by, the Company prior to the Closing Date:
d) any Environmental Liabilities of the Company, arising out
of or relating to (i) any violation of or noncompliance
with any Environmental Law occurring prior to the Closing
Date by the Company or any other person for whose conduct
the Company is or may be held responsible, (ii) the
ownership or operation, or, any condition at, the
facilities on or prior to the Closing Date, including any
migration of any such condition after the Closing Date,
(iii) the presence or release of any regulated material at
or with respect to the facilities on or prior to the
Closing Date, (iv) any hazardous activity conducted by the
Company or any other Person acting as agent for or on
behalf of the Company, (v) any release by the Company or
any other person acting as agent for or on behalf of the
Company on any other property, and (vi) any remedial action
required to be taken by the Company: and
e) any and all other material Liabilities of the Company
existing on the Closing Date or arising out of any
transaction entered into, or any state of facts existing,
prior to the Closing Date, except for those Liabilities
that are expressly quantified and set forth in this
Agreement and its Schedules.
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7.4 INDEMNIFICATION BY BUYER.
Buyer shall indemnify, defend, save and hold harmless Seller and
its officers, directors, employees, Affiliates and agents (each, a
"Seller Indemnitee") from and against any and all Damages
(collectively, "Seller Damages") directly or indirectly asserted
against, imposed upon, resulting to, or incurred or required to be
paid by any Seller Indemnitee from or in connection with, (i) any
breach or inaccuracy of any representation or warranty made by
Buyer in connection with this Agreement (ii) a breach or
nonperformance of any covenant or agreement made by Buyer in or in
connection with this Agreement or in any other agreement to which
Buyer is or is to become a party.
7.5 NOTICE OF CLAIMS.
If any Buyer indemnitee or Seller Indemnitee (an "Indemnified
Party") believes that it has suffered on incurred, or will suffer
or incur, any Damage for which it is entitled to indemnification
under this Article VIII, the Indemnified Party shall notify the
party or parties from whom indemnification is being claimed (the
"Indemnifying Party"). This notice shall specify the factual basis
of the claim in reasonable detail in light of the circumstances
then existing, If any Legal Proceeding is instituted by or against
a third party with respect to which any Indemnified Party intends
to claim any Damages, such Indemnified Party shall notify the
Indemnifying Party of such action or suit.
7.6 THIRD PARTY CLAIMS
The Indemnified Party shall have the right to conduct and control,
through counsel of its choosing, the defense of any third party
claim, action or suit. The Indemnified Party may compromise or
settle third party claim, action or suit so long as the
Indemnified Party gives the Indemnifying Party advance notice of
any proposed compromise or settlement. The Indemnified Party shall
permit the Indemnifying Party to participate in the defense of any
such claim, action or suit (except those involving Taxes,
Environmental Remedial Actions and any related Legal Proceeding)
through counsel chosen by the Indemnifying Party, so long as the
fees and expenses of that counsel are borne by the Indemnifying
Party. If the Indemnified Party permits the Indemnifying Party to
undertake, conduct and control the conduct and settlement of such
claim, action or suit: (i) the Indemnifying Party shall not permit
any Encumbrance to exist upon any asset of the Indemnified Party:
(ii) the indemnifying Party shall not consent to any settlement
that does not include as an unconditional term of the settlement
the giving of a complete release from Liability with respect to
such action or suit to the Indemnified Party: (iii) the
Indemnifying Party shall permit the Indemnified Party to
participate in such conduct or settlement through counsel chosen
by the Indemnified Party (without any Order by any Governmental
Body): and (iv) the Indemnifying Party shall agree promptly to
reimburse the Indemnified Party for the full amount of any Damages
including fees and expenses of counsel for the Indemnified Party.
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7.7 COMPANY LIABILITY
After the Closing, the Company shall have no Liability to Seller
for any breach of any representation or warranty made by Seller or
the Company to Buyer in this Agreement, in any certificate or
document furnished in connection with this Agreement by Seller or
the Company or any Other Agreement to which Seller or the Company,
or both, is or is to become a party.
7.8 As collateral for Seller's undertakings to pay to Buyer a partial
repayments of the Purchase Price the Sellers will deposit with
Xxxxxxx Xxxxxx Attorney at Law and Xxxxx Xxxxxx Attorney at Law as
joint Trustees (the "Trustee") an amount of shares out of the PP
Shares equal in value to U.S. $ 10,000,000 (ten million U.S.
Dollars) to be computed as per the Closing Price of the MRV Shares
on the day prior to the closing day (the "Deposited Shares"). The
Trustee is hereby instructed to sell the Deposited Shares
immediately following the Registration of the PP Shares and
deposit the proceeds of such sale in a bank account (the "Trust
Account"). The Trustee will be permitted to sell the Deposited
Shares at any earlier date upon a written demand of Buyer
notifying the Trustee of a substantiated claim against the Company
or any other claim for indemnification made by the Buyer. The
Trustee is hereby irrevocably instructed to pay out of the Trust
Account any amount due to the Buyer under this Agreement at Buyers
first demand. Any amounts due to the Buyer under this Agreement
which exceed the amounts in the Trust Account or the value of the
Deposited Shares will be paid from Seller's funds. Any amounts of
money or shares remaining in the Trust Account after the time for
claim indicated in Section 8.9 will be refunded by the Trustee to
the Sellers.
In the event that no claim for indemnification by Buyer has been
made within 2 years from date of Closing the Deposited Shares and
or any amount of cash in the Trust Account will be refunded to the
Sellers.
7.9 TIME FOR CLAIMS.
Any claim for indemnification under this Agreement must be made
within five (5) years of the Closing Date, except that the right
to make a claim for a partial repayment of the Purchase Price
shall survive until the end of the financial year following the
seventh anniversary of the Closing Date.
ARTICLE VIII
MISCELLANEOUS
8.1 PUBLICITY.
From the date hereof through and including the Closing Date, the
Seller or the Company shall not issue, or cause or permit the
publication by any of their respective Affiliates or
representatives, of any press release or other public
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announcementwith respect to this Agreement except with the consent
of the Buyer or as may be required by applicable Law. The
requirements of this Section 9.1 shall be in Addition to those
included in any Confidentiality Agreement (as defined in Section
9.5 below).
8.2 FURTHER ASSURANCES.
After Closing, without further consideration, Seller shall take or
cause to be taken such actions (including the execution,
acknowledgment and deliver of instruments, documents, transfers,
conveyances and assurances) as Buyer may request for the better
conveying, transferring, assigning delivering the Shares to Buyer
or any of the assets used in the Business to the Company.
8.3 OFFSET ASSIGNMENT.
Buyer shall be entitled to offset, setoff or recoup from any
amounts due to Seller from Buyer under this Agreement or under any
Other Agreement against any obligation of Seller to Buyer under
this Agreement or under any Other Agreement. This Agreement and
all the rights and powers granted by this Agreement shall bind and
inure to the benefit of the parties and their respective
successors and permitted assigns. This Agreement and the rights,
interests and obligations under this Agreement may not be assigned
by any party without the prior written consent of the other
parties, except that Buyer may make such assignments to any
Affiliate of Buyer provided that Buyer remains liable under this
Agreement.
8.4 SCHEDULES.
The disclosures in the Schedules to this Agreement, and those in
any supplement to the Schedules, relate only to the
representations and warranties in the Section of the Agreement to
which they expressly refer and not to any other representation or
warranty in this Agreement. In the event of any inconsistency
between the statements in this Agreement and those in the
Schedules, the statements in this Agreement will control.
8.5 AMENDMENT AND WAIVER: CUMULATIVE EFFECT.
To be effective, any amendment or waiver under this Agreement must
be in writing and signed by the party against whom enforcement of
the same is sought Neither the failure of any party to exercise
any right, power or remedy provided under this Agreement or to
insist upon compliance by any other party with its obligations
under this Agreement, nor any custom or practice of the parties at
variance with the terms of this Agreement, shall constitute a
waiver by such party of its right to exercise any such right,
power or remedy or to demand such compliance. The rights and
remedies of the parties are cumulative and not exclusive of the
rights and remedies that they otherwise might have now or
hereafter at law, in equity, by statute or otherwise.
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8.6 SEVERABILITY.
If any term or other provision of this Agreement is held by a
court of competent jurisdiction to be invalid, illegal or
incapable of being enforced under any applicable Legal Requirement
in any particular respect or under any particular circumstances,
then, so long as the economic or legal substance of the
Contemplated Transactions is not affected in any manner materially
adverse to any party, (i) such term or provision shall
nevertheless remain in full force and effect in all other respects
and under all other circumstances, and (ii) all other terms,
conditions and provisions of this Agreement shall remain in full
force and effect. Upon such determination that any term or other
provision is invalid, illegal or incapable of being enforced, the
parties shall negotiate in good faith to modify this Agreement so
as to effect the original intent of the parties as closely as
possible in an acceptable manner so that the Contemplated
Transactions are fulfilled to the fullest extent possible.
8.7 FINANCIAL ADVISORS, BROKERS AND FINDERS.
a) The Seller represents and warrants to the Buyer that it has
not employed the services of an investment banker,
financial advisor, broker or finder in connection with this
Agreement or any of the transactions contemplated hereby.
The Seller indemnifies and agrees to defend and hold the
Buyer and each of the Companies harmless against and in
respect of all claims, losses, liabilities, fees, costs and
expenses which may be asserted against the Buyer (or any
Affiliate of the Buyer) by any broker or other person who
claims to be entitled to an investment banker's, financial
advisor's, broker's, finder's or similar fee or commission
in respect of the execution of this Agreement, or the
consummation of the transactions contemplated hereby, by
reason of his acting at the request of the Seller.
b) The Buyer represents and warrants to the Seller that it has
not employed the services of an investment banker,
financial advisor, broker or finder in connection with this
Agreement or any of the transactions contemplated hereby.
The Buyer indemnifies and agrees to save and hold the
Seller harmless against and in respect of all claims,
losses, liabilities, fees, costs and expenses which may be
asserted against it by any broker or other person who
claims to be entitled to an investment banker's, financial
advisor's, broker's, finder's or similar fee or commission
in respect of the execution of this Agreement or the
consummation of the transactions contemplated hereby, by
reason of his acting at the request of the Buyer.
8.8 COSTS AND EXPENSES.
Whether or not the transactions contemplated by this Agreement are
consummated, each of the parties to this Agreement shall bear its
own expenses incurred in connection with the negotiation,
preparation, execution and closing of this Agreement and the
transactions provided for hereby.
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8.9 NOTICES.
All notices or other communications required or permitted by this
Agreement shall be effective upon receipt and shall be in writing
and delivered personally or by overnight courier, or sent by
facsimile, as follows:
If to Buyer, to: MRV COMMUNICATIONS INC.
00000 Xxxxxxxx xxxxxxxxxx
Xx, 00000 X.X.X.
With a copy to: X. Xxxxxx, Attorney at Law
0, Xxxxxx Xxxxxx Xx., Xxx - Xxxx
Xxxxxx
If to the Seller, to: Xx. Xxxxx Xxxxxx
00 Xxxxxx xx., Xxxxxxxxx
Xxxxxx
With a copy to: Slonim and Xxxxxxxxx
0 Xxxxxxx xx. Xxx - Xxxx 00000
Xxxxxx
or to such other address as hereafter shall be furnished as any of
the parties hereto to the other parties hereto.
8.10 ENTIRE AGREEMENT.
This Agreement (together with its Schedules) represents the entire
agreement and understanding of the parties with reference to the
transactions set forth herein and no representations or warranties
have been made in connection with this Agreement other than those
expressly set forth herein. This Agreement supersedes the MOU
executed on March 26 2000 all prior negotiations, discussions,
correspondence, communications, understandings and agreements
between the parties relating to the subject matter of this
Agreement (other than the Confidentiality Agreement dated ________
(the "Confidentiality Agreement"), which shall remain in full
effect for all purposes thereof) and all prior drafts of this
Agreement, all of which are merged into this Agreement, No
Memorandum of understanding, prior drafts of this Agreement and no
words or phrases from any such prior drafts shall be admissible
into evidence in any proceeding or other legal action involving
this Agreement. All Schedules hereto are part of the present
Agreement, and any matter disclosed in any Schedule shall be
deemed disclosed in every other Schedule.
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8.11 NO THIRD PARTY RIGHTS ASSIGNMENT.
This Agreement is intended to be solely for the benefit of the
parties hereto and is not intended to confer any benefits upon, or
create any rights in favor of, any person other than the parties
hereto and shall not be assignable (other then by the Buyer to any
of its affiliates) without the prior written consent of the other
party. Notwithstanding the foregoing, the Seller acknowledge and
agrees that the Buyer may at any time prior to Closing assign its
rights to purchase the Shares and its other rights under this
Agreement to one or more subsidiaries of the Buyer, provided that
no such assignment shall relieve the Buyer of any of its
obligations hereunder.
8.12 TRANSFER TAXES.
Any transfer taxes or similar levies that may become payable in
Israel or any other Jurisdiction as a result of the execution of
this Agreement or the transfer of the Shares pursuant thereto, and
which are by law payable initially as a primary obligation of
Seller shall be for the sole account of the Seller stamp tax in
connection with this Agreement shall be paid in equal shares by
Seller and Buyer.
8.13 GOVERNING LAW.
This Agreement shall be governed by and enforced in accordance
with the laws of Israel and the Courts of Tel - Aviv, Israel will
have sole Local Jurisdiction in connection with any dispute
arising in connection with this Agreement and the transactions
described.
IN WITNESS WHEREOF, THE PARTIES HERETO HAVE EXECUTED THIS AGREEMENT AS OF THE
DATE FIRST ABOVE WRITTEN.
XXXXX XXXXXX
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XXXX XXXXXX - AMISHAV
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XXXXXXXX XXXXXX
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XXXXXXXX XXXXXX
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XXXXX XXXXXX
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XXXXXXX XXXXXX
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JOLT LTD.
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BY: XXXXX XXXXXX CHAIRMAN OF THE BOARD AND C.T.O.
MRV COMMUNICATIONS INC.
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BY: XXXXX XXXXX
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