Contract
Final
version
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AWS
HOLDING AB AND XXXXXX X. XXXXXXXXXX XX
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GEXFO
DISTRIBUTION INTERNATIONALE INC.
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REGARDING
PICOSOLVE AB
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Final
version
Final
version
Final version
This
share transfer agreement (this “Agreement”) is entered into on 5 February
2009
AMONGST:
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(1)
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Starta Eget Boxen 11 629
AB, in the process of changing its name to AWS Holding AB, a
company duly incorporated and organised under the laws of Sweden, Sweden
(the “Holding”); and NOTE 1
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(2)
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Xxxxxx
X. Xxxxxxxxxx Xx., (“NN”) NOTE
1
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Holding
and NN are jointly referred to as the Seller
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(3)
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GEXFO Distribution
Internationale, Inc., a company duly incorporated and organised
under the laws of the province of Quebec, Canada, having its registered
address at 000 Xxxxx Xxxxxx, Xxxxxx City, Province of Quebec,
Canada, X0X 0X0 (the “Buyer”).
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Background
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1.1
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PicoSolve
AB, is a company duly incorporated and organised under the laws of Sweden,
having its registered address at Xxxxxxxx Xxxxxxxxxx, 000 00 Xxxxxxxxxx,
Xxxxxx (the “Company”), NOTE 1
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The
Intellectual Property as defined herein and other assets related to a method and
apparatus for the Technology. NOTES 1 AND 2
NOTE
1
Buyer is
a holding company whose parent company EXFO Electro-Optical Engineering, Inc
(“EXFO”) is a company active directly or indirectly in technologial
areas related to the Technology.
NOTE 1: Contains seller's
confidential information.
NOTE 2: Contains confidential
information that would be prejudicial to the interests of EXFO.
NOTE
2
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1.2
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The
Seller owns all of the outstanding shares in the Company. NOTE
1
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1.3
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The
Seller agrees to sell and the Buyer agrees to purchase all of the Shares
on a fully diluted basis the terms and conditions set out in this
Agreement.
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Definitions
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In this
Agreement, the following definitions are used:
“Accounting Principles” means
generally accepted accounting principles in Sweden
“Accounts” means the balance
sheet attached hereto as Appendix
6.5.2;
“Accounts Date” means 5
February 2009
“Affiliated Person”
means a closely related Person (Sw. närstående) as set out in
Chapter 21 § 1 of the Swedish Companies Act (Sw. Aktiebolagslagen
(2005:551)) or a Person directly or indirectly controlling, controlled by
or under common control with the Seller or the Buyer (as the case may
be);
“Agreement” means this share
transfer agreement, including all the appendices attached to it;
“Business” means the
development and commercializing of the Technology by the EXFO
Group;
“Business Day” means a day
when banks are open for general banking business in Sweden and
Canada;
“Buyer” means GEXFO
Distribution Internationale, Inc.;
“Claim” means any claim made
by the Buyer against the Seller in respect of a Loss;
“Closing” means the completion
of the transaction contemplated by this Agreement;
“Closing Date”
means February 5, 2009
“Company” means
Picosolve AB, NOTE 2;
NOTE 1: Contains seller's
confidential information.
NOTE 2: Contains confidential
information that would be prejudicial to the interests of EXFO.
“Competition Authorities”
means the competition authorities or courts in the jurisdictions listed in Appendix 4.6, and/or the European Commission or a
relevant member state of the European Economic Area, in the event of a referral
thereto;
“Confidential Information”
means any information of any kind or nature whatsoever, whether written
or oral, including, without limitation, this Agreement and financial
information, trade secrets, customer lists and other information, regarding the
Buyer, the Seller or the Company which is not known to the general
public;
“Directors” means the board
members, deputy board members, managing directors and deputy managing
directors of the Company as at the Closing Date;
“Earn-Out period” has the
meaning set out in Section 4;
“Encumbrance” means any
mortgage, charge, pledge, lien, option or other security interest or restriction
of any kind;
“EXFO Group” means the current
and future companies directly or indirectly controlled by or under common
control of EXFO;
“Independent Accounting Firm”
means a reputable international accounting firm to be selected by the
Parties, provided that such firm shall not then be currently performing
significant services for any of the Parties or, failing agreement between them,
such firm to be appointed by the Stockholm Chamber of Commerce;
“Intellectual Property” means
inventions, patents, trademarks, domain names, trade names, designs, copyrights
(including copyrights in software), neighbouring rights and database rights,
confidential and proprietary information including trade secrets, know-how, and
any other rights of a similar kind, whether registered or not, including
applications for the registration of such rights;
“Licensed Intellectual
Property” means all Intellectual Property licensed to any of the
Company;
“Loss” means any claim, loss,
damage, liability or expense that the Buyer or the Company has incurred or may
incur (including, without limitation, settlement costs and any legal, accounting
and other expenses for the investigation or defence of any actions or threatened
actions), resulting from or in connection with any breach of any of the
Warranties;
“Material Agreement” means
each agreement and other undertaking by or to Company, the value of which, or
which contains undertakings or provisions that restrict the ability or right of
the Company to engage in any business or compete with any Person, or which has
not been entered into in the ordinary course of the Business or which is
otherwise of material importance to the Company or the Business; NOTE
2
NOTE 2: Contains confidential
information that would be prejudicial to the interests of EXFO.
“Net selling price” means the
price payable by the customer, exclusive of taxes, freights, customs and any
other external charges;
“Network” means all hardware
which is used in the Business and all communication networks or the network
capacity which is necessary for the communication systems used in the
Business;
“Open Source Software” means
software licensed under terms pursuant to which the software licensed may be
used, modified and/or redistributed in source code and/or object code forms
without the payment of a license fee, including but not limited to those
licenses approved by the Open Source Initiative (see xxx.xxxxxxxxxx.xxx) , such
as the GNU General Public License (GPL), the GNU Library or Lesser General
Public License (LGPL), the Mozilla Public License and the Apache
License;
“Owned Intellectual Property”
means all Intellectual Property owned by the Company;
“Party” means the Seller or
the Buyer, and “Parties”
means the Seller and the Buyer, collectively;
“Person” means any individual,
firm, company, corporation or other corporate body, government, state or agency
of a state or any joint venture, trust, association or partnership (general or
limited), whether or not incorporated, and whether or not its owners enjoy
limited liability, and any other legal entity;
“Purchase Price” means the
purchase price for the Shares set out in Section 4.1.1 hereof;
“SEK” means the currency
Swedish kronor;
“Seller” mean AWS Holding AB,
and NN; NOTE 1
“Shares” means all outstanding
shares in the Company on a fully diluted basis;
“Signing Date” means the
date of this Agreement;
“Statutory Books” means the
shareholders’ register and minutes from shareholders’ meetings and board
meetings;
“Taxes” means all direct
and indirect taxes and charges, social security fees, fees, duties and other
assessments (including but not limited to any income tax, whether actual or
deemed), sales tax, use tax, transfer tax, transaction tax, investment tax,
capital tax, real property tax, value added tax, withholding tax, employment
tax, asset holding tax or registration tax, preliminary tax under the Swedish
Tax Payment Act (Sw.
skattebetalningslagen), or the equivalent legislation in any relevant
jurisdiction, or any amendments or replacements thereof, and deferred taxes,
wherever arising, together with any interest, penalties, residual tax charges or
addition to tax; and
NOTE 1: Contains seller's
confidential information.
NOTE 2
“Valid Bookings” means
confirmed purchase orders, for products developed or based on the Technology,
received by the EXFO Group and accepted by the EXFO Group under their normal
business terms NOTE 2
“Warranties” means the
warranties (Sw.
garantier) of the Seller set out in Section 6.
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Sale
and Purchase
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3.1
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Upon
the terms and subject to the conditions set out in this Agreement, the
Seller agrees to sell and the Buyer agrees to purchase the Shares,
together with all rights attached to
them.
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3.2
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The
Shares shall be transferred to the Buyer on and as of the Closing Date,
free and clear from any
Encumbrances.
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Purchase
Price
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The
Purchase Price
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4.1.1
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NOTE
2
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4.2
Payment
of the Fixed Purchase Price
The Fixed
Purchase Price shall be paid in USD by the Buyer on the Closing Date as set out
below:
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(a)
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NOTE
2
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(b)
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NOTE
2
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4.3 Payment
of the Earn-Out
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The
purchase price for the Shares shall comprise of the First Earn-out,
the Second Earn-out, the Third Earn-Out and the Fourth Earn-Out
and the four Earn-Outs calculated and paid according to an Earn-out
structure as further set out below. Payment shall be effected to Holding
and NN in the same proportions as the Fixed Purchase Price. Each of the periods below shall be an “Earn-Out
period”. NOTE 2
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NOTE 2: Contains confidential
information that would be prejudicial to the interests of
EXFO.
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4.3.1
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NOTE
2
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4.3.2
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NOTE
2
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4.3.3.
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NOTE
2
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4.3.4
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NOTE
2
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4.4 Calculation
of Earn-out
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4.4.1
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The
Buyer shall calculate earned Earn-Out for the respective period above
after the expiry of the period. The calculation shall be made in USD as
per EXFO’s accounting system.
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Appendix 4.4.1 sets out an example of the
calculation of the Earn-Out
amounts.
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4.4.2
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The
Seller may audit the Buyer’s calculation of Earn-Out at any time through
an Independent Accounting Firm at Seller’s
cost.
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4.5
Dates for Payment of the Earn-Out
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4.5.1
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Within
Business Days following the expiry of an Earn-Out period NOTES 1, 2
AND 3
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NOTE 1: Contains seller's
confidential information.
NOTE 2: Contains confidential
information that would be prejudicial to the interests of EXFO.
NOTE 3: Contains third party
confidential information.
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4.5.2
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NOTE
2
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4.6
General Conditions
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The
respective obligations of the Buyer and the Seller to complete the
transactions contemplated by this Agreement shall be subject to receipt of
all clearances and approvals from the Competition Authorities, listed in
Appendix 4.6 unconditional, or if
subject to any conditions, only such conditions that are acceptable to the
Buyer in its sole discretion or the waiver by the Buyer of any clearance
or approval from the competition
authorities.
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The
Buyer has waived this condition on the Closing
Date.
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4.7
Conditions Precedent to Buyer’s obligations
The
obligations of the Buyer to complete the transactions contemplated by this
Agreement shall be subject to the satisfaction or the waiver by the Buyer of the
following conditions precedent:
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(a)
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any
and all required consents under any of the Material Agreements to the
change of control or change of management of the Company having been
obtained on terms and conditions acceptable to the Buyer, in its sole
discretion;
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(b)
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the
Warranties being true and correct at the Closing Date and the
Seller shall having performed all of its obligations hereunder
required to be performed by it on or prior to the Closing Date;
and
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(c)
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approval
of the board of directors of the Buyer and EXFO;
and
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(d)
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the
Patent Transfer Agreement between Holding and EXFO, shall have been duly
executed; and
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(e)
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NOTES
3 AND 4
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(f)
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NOTES
1 AND 2
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(g)
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The
balance sheet of the Company as of the Closing Date satisfactory to the
Buyer
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NOTE 1: Contains seller's
confidential information.
NOTE 2: Contains confidential
information that would be prejudicial to the interests of EXFO.
NOTE 3: Contains third party
confidential information.
NOTE 4: Contains confidential
employee related information.
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(h)
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NOTES
3 AND 4
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4.8 Non-fulfilment
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In
the event that the conditions set out in Sections 4.7 above have not been
fulfilled , the Buyer shall be entitled, in its sole discretion, to
terminate this Agreement forthwith in writing, and the Seller shall not be
entitled to any compensation of any kind due to such termination. NOTE
2
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Closing
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5.1
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Signing
and Closing shall take place at the offices of Advokatfirman Xxxxx KB,
Xxxx Ericssongatan 17, Göteborg, at 14.00 on the Closing
Date.
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5.2
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At
Closing:
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(a)
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the
Seller shall:
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(i)
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transfer
the Shares
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(ii)
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deliver
to the Buyer the Company’s shareholders’ register, evidencing that the
Buyer has been duly entered as the holder of the
Shares;
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(iii)
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ensure
that all Directors, as notified by the Buyer to the Seller not later than
three (3) Business Days prior to the Closing Date, retire from their
respective offices, each such Director acknowledging in writing that he or
she has resigned as a director of the Company, and that he or she has no
claims against the Buyer or the Company for compensation or
otherwise;
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(iv)
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have
taken all such measures that are requested by the Buyer in order for the
Buyer to hold a shareholders’ meeting and a board meeting in the Company
on the Closing Date, allowing the Buyer to appoint new directors and
deputy directors, to appoint company signatories and to make all other
decisions required by the Buyer;
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(v)
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cause
the Company to issue powers of attorney enabling the persons appointed by
the Buyer to sign for and on behalf of the Company until new signatories
have been duly registered;
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(vi)
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demonstrate
to the Buyer that the Company has been fully and finally released from
guarantees, indemnities or other obligations given or incurred by the
Company, as applicable, in favour of the Seller or any of its Affiliated
Persons.
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(vii)
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Demonstrate
to the Buyer that the Company does not have any debt, amount payable,
taxes payable or any other amount due at the Closing
Date.
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NOTE 2: Contains confidential
information that would be prejudicial to the interests of EXFO.
NOTE 3: Contains third party
confidential information.
NOTE 4: Contains confidential
employee related information.
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(b)
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the
Buyer shall, against performance by the Seller of the requirements in
Section 5.2 (a), pay the Purchase Price as set out in Section
4.1.
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Warranties
of the Seller
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The
Seller makes the following warranties (Sw. garantier), all of which
are made as of the Closing Date, unless otherwise expressly stated.
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Corporate
Existence and Power
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6.1.1
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The
Holding and the Company are duly incorporated and validly existing under
the laws of the jurisdictions in which they were incorporated and the
Seller has the requisite power and authority to enter into and perform its
obligations under this Agreement and in any certificate or other document
furnished or to be furnished under this Agreement. The Company has full
corporate power and all necessary licences, permits and authorisations to
carry on the Business as now conducted and to own, lease and operate the
assets and Properties necessary in connection therewith. NN has the
requisiste power and authority to enter into and perform his obligations
under this Agreement and any obligation relating
hereto.
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6.1.2
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The
Company has not filed (or have had filed against them) any petition for
their winding-up, are not insolvent within the meaning of applicable laws,
rules or regulations or similar requirements, and have not made any
assignment in favour of its creditors, nor has any petition for
receivership or any administration order been presented in respect of any
of the Company. The Company has not initiated any proceedings with respect
to a compromise or arrangement with its creditors or for the dissolution,
liquidation or reorganisation of theCompany or the winding-up or cessation
of the business of the Company. No receiver or administrative receiver or
liquidator has been appointed in respect of the Company or any of its
material assets.
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Corporate
Authorisation and Non-Contravention
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6.2.1
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This
Agreement and any certificate or other document furnished or to be
furnished under this Agreement and the performance by the Seller of its
obligations under them have been duly authorised by all necessary
corporate action on the part of the Seller, and this Agreement and any
other document or instrument executed in connection with this Agreement
will, when executed, constitute valid and binding obligations of the
Seller in accordance with their respective
terms.
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6.2.2
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The
execution by the Seller of this Agreement and any other document or
instrument in connection with it, and the performance by the Seller of its
obligations under the Agreement and the consummation of the transaction
provided for in this Agreement, do not and will not result in a breach of
any provision of the articles of association of the Seller or the Company
or of any applicable law, order, judgement or decree of any court or
governmental agency or of any agreement to which the Seller or the Company
is a party or by which the Seller or the Company is
bound.
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Capitalisation
and Title
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6.3.1
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The
Seller lawfully owns and has good and transferable title to the Shares.
The Shares are free and clear from any Encumbrances and there is no
agreement to create any Encumbrance over any such shares. Upon the
delivery of the Shares by the Seller against payment of the Purchase
Price, the Buyer will acquire good and marketable title to the Shares free
and clear from any Encumbrances.
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6.3.2
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The
share capital of the Company is fully and correctly listed in Appendix 6.3.2. The Shares constitute the
entire issued capital stock of the Company, and are legally and validly
issued and fully paid and owned as set out in Appendix
6.3.2.
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6.3.3
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There
are no outstanding subscriptions, options or similar rights relating to
the Shares and no securities giving a right to conversion into, or any
agreement or arrangement which accords to any Person the right to acquire,
shares in the Company.
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6.3.4
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All
share certificates representing the Shares are in the possession of the
Seller and they are the only share certificates ever issued in
relation to such shares.
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6.3.5
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The
Company has been rendered any conditional contribution by any
Person.
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Records
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6.4.1
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Copies
of the Company’s articles of association, shareholders’ registers and
extracts from the relevant trade registers are attached as Appendix 6.4.1, and all such copies are
true, accurate, up-to-date and complete, and reflect the present status of
the Company.
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6.4.2
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All
constitutional and other corporate documentation of the Company required
by the applicable law, including but not limited to the Statutory Books,
articles of association, annual reports, permits and licences, exist and
are kept in accordance with applicable law and in an organised way and are
true, accurate, up-to-date and complete, and all registrations and
applications relating thereto have been fulfilled, and all applicable fees
have been paid. There are no registrations of changes pending with the
relevant authorities in the jurisdiction of the Company. No notice or
allegation that any of the corporate documentation mentioned in this
Section 6.4.2 is incorrect or should be rectified has been
received.
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Accounts
and Accounting Principles
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6.5.1
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The
Accounting Principles have been applied on a consistent basis during the
existence of the Company.
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6.5.2
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The
Accounts have been prepared in accordance with the Accounting Principles
and they give a true and fair view of the financial position and results
of the operations of the Company. Balance sheet is attached as, Appendix
6.5.
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6.5.3
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The
Company has not pledged any assets or has any obligations,
commitments or liabilities, liquidated or non-liquidated, contingent
or otherwise, whether for Taxes or otherwise, in excess of what is shown
in the Accounts.
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6.5.4
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The
inventory of the Company has been subject to physical stock-taking as at
the Accounts Date and adequate reserves have been made in the Accounts for
slow moving items, excessive inventory levels and commercial or technical
obsolescence in accordance with the Accounting
Principles.
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6.5.5
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The
value of all inventory, including finished goods, work-in-process and raw
materials, has been recorded in accordance with the Accounting
Principles.
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Loans
and Other Financial Facilities
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6.6.1
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There
are no loans or other financial facilities available to the Company other
than as set out in Appendix
6.6.1.
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6.6.2
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There
is no event which gives, or after notice or lapse of time, or both, would
give any third party the right to call for repayment from the Company
prior to normal maturity of any loan or other financial
facility.
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Dividends
and Loans
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The
Company has not made any payment to its shareholders or any other Person or
granted or received loans or furnished securities in contravention of the
Swedish Companies Act (Sw.
Aktiebolagslagen (2005:551)) or the equivalent legislation in any
relevant jurisdiction.
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Title
to Assets
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6.8.1
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The
Company is the owner of the assets, tangible and intangible, that are
reflected in the Accounts and has good and marketable title to all such
assets, tangible and intangible, free and clear from any
Encumbrance.
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6.8.2
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The
Company does not have any lease for premises and assets, tangible and
intangible, necessary for it to carry on the Business as presently
conducted.
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Accounts
Receivable and Liquid Assets
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6.9.1
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There
are no accounts receivable or any amount to be received by the Company at
the Closing Date.
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6.9.2
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All
liquid assets of the Company, including but not limited to bank accounts
and cash, are available free and clear from any
Encumbrances.
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Leased
Premises
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6.10.1
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There
are no lease agreements for premises leased by the
Company.
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6.10.2
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The Company
does not own and has never owned any real estate or
property.
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Powers
of Attorney
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The
Company has not issued to any Person any power of attorney or other
authorisation (express or implied), which is still outstanding, to enter into
any agreement or obligation or other transaction on its behalf or to bind it in
any way, other than the authorisation given to its employees to enter into
routine agreements in the ordinary course of business.
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Agreements
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6.12.1
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There
are no other Material Agreements than those listed in Appendix 6.12.1. The Material Agreements
listed in said appendix are in full force and effect and the text of the
agreements accurately reflects the contents of the
agreements.
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6.12.2
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Neither
the Seller nor the Company has received any notice that the Company
is in default under any provision of any Material Agreement,
and the Company has not received or given notice of termination of any
Material Agreement.
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6.12.3
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The
Company is not:
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(a)
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in
default under any provision of any Material Agreement and no event has
occurred which would constitute such a
default;
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(b)
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aware
of, or has any reason to believe, that any counterparty to a Material
Agreement is in default under any provision of any Material
Agreement;
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(c)
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a
party to any agreement containing provisions for material price
re-determination or price revision except for compensation for inflation,
movements in exchange rates, and discounts for bulk
buying;
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(d)
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or
has been a party to any agreement or arrangement which is or could be
contravening applicable laws;
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(e)
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a
party to or bound by any agreement, judgement or order under which the
execution or performance of this Agreement (i) would give any other
contracting party the right to terminate or adversely change the terms and
conditions of such agreement, or that would otherwise have a negative
effect for the Company, or (ii) would constitute a violation or default by
the Company, or (iii) would result in the creation of an Encumbrance on
any assets of the Company; or
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(f)
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a
party to any agreement containing any terms or conditions not consistent
with fair market terms, conditions and
prices.
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6.12.4
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The
Company has not sold any company, business, shares, real property or other
asset where there are outstanding obligations or warranty undertakings
(express or implied), except as set out in Appendix
6.12.4.
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Insurance
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6.13.1
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The
Company does not maintain insurance policies on fire, theft, loss,
disruption, product and general liability and other forms of
insurance.
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Environmental
Matters
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6.14.1
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The
Company fully complies and has fully complied with the Environmental
Laws.
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Intellectual
Property
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6.15.1
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Appendix 6.15.1 sets forth a true and
complete list of all i) patent registrations and patent applications,
trademarks, trademark registrations, trademark applications, designs,
design registrations, design applications and domain names included in the
Owned Intellectual Property, and ii) license agreements for Licensed
Intellectual Property
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6.15.2
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The
Owned Intellectual Property and the Licensed Intellectual Property include
all of the Intellectual Property used in the ordinary conduct of the
Business as currently conducted or intended to be conducted and there are
no other items of Intellectual Property that are necessary for the
ordinary conduct of the Business or for the Business contemplated to be
conducted.
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6.15.3
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The
Company is the exclusive owner of the Owned Intellectual Property with
full right of disposition and not subject to any Encumbrances, and are
entitled to use the Licensed Intellectual Property in the ordinary course
of the Business as currently conducted or as contemplated to be
conducted.
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6.15.4
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The
Owned Intellectual Property and the Licensed Intellectual Property are
subsisting, valid, enforceable and not withdrawn, cancelled or abandoned.
All Owned Intellectual Property and Licensed Intellectual Property which
may be registered by the Company have been duly registered. All
application fees and renewal fees for such Intellectual Property have been
paid in full and the registrations and applications are in all other
respects being maintained and
asserted.
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6.15.5
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Appendix 6.15.5 sets forth a list of all
litigation, proceedings, investigations, claims or actions of any nature
alleging that the operation of the Business as formerly or currently
conducted or as contemplated to be conducted or the use of the Owned
Intellectual Property or the Licensed Intellectual Property infringes,
misappropriates, or otherwise violates or conflicts with the Intellectual
Property of any Person. Except as set out in Appendix 6.15.5, no
litigation, proceedings, investigations, claims or actions of such nature
are pending or are threatened.
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6.15.6
|
No
Person has been engaged, is engaging or is expected to engage in any
activity or use of any Intellectual Property that infringes,
misappropriates, or otherwise violates or conflicts with the Owned
Intellectual Property or the Licensed Intellectual
Property.
|
|
6.15.7
|
Except
as set out in Xxxxxxxx 0.00.0, xxxx of the Owned Intellectual
Property or Licensed Intellectual Property has been, is or is expected to
become, subject to any outstanding consents, settlements or judgments
restricting the use of such Intellectual Property or adversely effecting
the commercial value of the Company’s right to such Intellectual Property
or that would impair the validity or enforceability of such Intellectual
Property and the Company has not granted, or is obliged to grant, any
licence, assignment or other right in respect of any Intellectual
Property, or is obliged to disclose any Intellectual Property to any
Person.
|
|
6.15.8
|
The
consummation of the transactions contemplated by this Agreement will not
cause any impairment of any Owned Intellectual Property or any termination
of any license agreement for Licensed Intellectual Property or effect any
change in such agreement adverse to the
Buyer.
|
|
6.15.9
|
The
Company has, with respect to third parties, maintained the confidentiality
of any trade secrets and other confidential Intellectual Property related
to the Business.
|
|
6.15.10
|
All
software used by the Company is free of all viruses, worms, Trojan horses
and other contaminants and does not contain any bugs, errors, or problems
of a material nature that disrupt its operation or have an adverse impact
on the operation of other software programs or operating
systems.
|
|
6.15.11
|
No
Open Source Software has been used by the Company and no product or item
developed or distributed by the Company has been distributed with, or is
designed to link with or access in any way any Open Source
Software.
|
|
6.15.12
|
The
Company has complied with the requirements of all licenses if any for
Licensed Intellectual Property, including licenses for Open Source
Software.
|
|
6.15.13
|
None
of the activities of the Company or the employees of the Company violates
any agreement or arrangement which any such employees have with former
employers. All employees and consultants who contributed to the discovery
or development of any of the Owned Intellectual Property have fully and
finally (without any compensation remaining to be paid) assigned all
rights to such Intellectual Property to the
Company.
|
|
IT
and Data Protection
|
|
6.16.1
|
The
Company is not using software and is not using a Network for the
Business.
|
|
Employment
and Pension Agreements and Labour
Controversies
|
|
6.17.1
|
Except
as set out in Appendix 6.17.1 there
are no, and the Company has not undertaken to have collective bargaining
agreements of the Company.
|
|
6.17.2
|
NOTES
1, 2 AND 4
|
NOTE 1: Contains seller's
confidential information.
NOTE 2: Contains confidential
information that would be prejudicial to the interests of EXFO.
NOTE 4: Contains confidential
employee related information.
|
Compliance
with Law
|
|
6.18.1
|
The
Company complies with and has at all times (i) complied with and (ii)
conducted the Business in accordance with applicable laws relating to its
operations and the Business.
|
|
6.18.2
|
All
necessary licenses consents, permits and authorisations have been
obtained by the Company to enable the Company to carry on the Business in
the places and in the manner in which such business is now conducted and
all such licences, consents, permits and authorisations are valid and
subsisting and have been complied with in all respects. NOTE
2
|
|
Litigation
|
|
6.19.1
|
There
are no suits, administrative, arbitration or other proceedings (including
but not limited to Tax proceedings) pending or threatened againstt the
Company, the Business or assets, and there are no such suits or
proceedings pending or threatened by the Company against any other Person,
nor are there any circumstances which may result in such suits,
administrative, arbitration or other proceedings, except as set out in
Appendix
6.19.1.
|
|
6.19.2
|
No
investigation or enquiry is being or has been conducted by any
governmental, fiscal, regulatory or other body in respect of the affairs
of the Company, and no such investigation is pending, threatened or
expected.
|
|
Taxes
|
|
6.20.1
|
The
Company has properly filed with the appropriate tax authorities all tax
returns and reports required to be filed for all tax periods ending prior
to the Closing Date and such filings are true, correct and complete and
all information required for a correct assessment of Taxes has been
provided, and the Company is not in delay with the payment of any Taxes
due to any tax authority.
|
|
6.20.2
|
The
tax returns of the Company have been assessed and approved by the tax
authorities through the tax years up to and including the years for which
such assessment and approval is required and the Company is not subject to
any dispute with any such
authority.
|
|
6.20.3
|
All
Taxes that have become due have been fully paid or fully provided for in
the Accounts and the Company will not be liable for any additional Tax
pertaining to the period before the Accounts Date. All Taxes for the
period after the Accounts Date have been fully paid when
due.
|
|
6.20.4
|
There
are no tax audits, disputes or litigation currently pending with respect
to the Company, and there is no basis for assessment of any deficiency in
any Taxes against
|
|
6.20.5
|
The
Company has not been involved in any transactions, which could be
considered as tax evasion.
|
NOTE 2: Contains confidential
information that would be prejudicial to the interests of EXFO.
|
6.20.6
|
All
transactions and agreements entered into by the Company with the Seller
have been made on terms and conditions which do not in any way deviate
from what would have been agreed between independent parties (i.e. on
an arm’s length basis).
|
|
6.20.7
|
All
losses for tax purposes incurred by the Company are trading losses and are
available to be carried forward and set off against income in succeeding
periods without limitation and have been accepted by the relevant tax
authorities.
|
|
6.20.8
|
The
Company is not and has not been subject to any taxation outside its
respective country of fiscal
residence.
|
|
The
Business
|
|
6.21.1
|
The
Company is not a party to or bound by any agreement which limits the
freedom of the Company to compete in any line of business or with any
Person or to transact business with any
Person.
|
|
6.21.2
|
The
Company has no interest in any other business entity or association or
carries on, or has agreed to carry on, business in partnership or as an
equity participant in a joint venture with any other
Person.
|
|
6.21.3
|
The
Company has not entered into any agreement or commitment or is a party to
any transaction or arrangement which is not of an arm’s length nature or
not made in connection with the
Business.
|
|
6.21.4
|
There
is no Encumbrance on the whole or on any part of the Business or assets of
the Company except as set out in the Accounts and there is no agreement to
create any such Encumbrance.
|
|
6.21.5
|
The
Company has no outstanding offers which are capable of being binding
following acceptance by any third party, except in the ordinary course of
business.
|
|
6.21.6
|
The
Company is not bound by any agreement which cannot readily be fulfilled or
performed by the Company on time.
|
|
Relationship
with the Seller
|
|
6.22.1
|
Neither
the Seller, SCI, nor any of its Affiliated Persons or any other Person
affiliated with the Seller, have any claims of any kind against the
Company and the Company is not indebted in any way towards the Seller,
SCI, any of the Seller’s Affiliated Person or any other Person affiliated
with the Seller.
|
|
6.22.2
|
There
are no agreements or arrangements between the Company and the Seller, no
liabilities or obligations (contingent or otherwise) owed by the Company
in respect of the Seller, and no guarantees or similar commitments issued
by the Company for obligations owed by the
Seller.
|
|
6.22.3
|
No
services, which have been provided by the Seller to the Company, are
necessary for the conduct of the Business in the ordinary
course.
|
|
6.22.4
|
No
payments of any kind, including but not limited to management charges,
have been made by the Company to the Seller, save for payments under
agreements or arrangements made on an arm’s length
basis.
|
|
6.23
|
|
6.23.1
|
All
documents provided to the Buyer by or on behalf of the Seller or the
Company are true and correct and no document provided to the Buyer by or
on behalf of the Seller or the Company, contains any untrue statement of a
relevant fact or omits to state a relevant fact necessary not to make the
statements contained in the document
misleading.
|
|
6.23.2
|
All
original copies and other relevant documentation relating to agreements
entered into by the Company, and other information which is relevant in
relation to the activities of the Company, including historical records,
are true, accurate and complete in all respects and kept in good order and
are in the possession of the
Company.
|
|
6.23.3
|
There
are no facts or circumstances relating to the affairs of any of the
Company which have not been disclosed to the Buyer and which, if
disclosed, might reasonably have been expected to influence the decision
of the Buyer to purchase the Shares on the terms of this
Agreement.
|
|
Absence
of Certain Changes or Events
|
Except as
expressly set out in Appendix 6.24.1, since
the Accounts Date:
|
(a)
|
the
Business has been conducted in the ordinary course of business with a view
to maintaining it as a going concern and no major decisions in any matters
of material importance to the Business have been implemented and the
Company has complied with applicable laws and has used its best efforts to
maintain all material licenses, permits and authorisations required to
carry on the business as presently
conducted;
|
|
(b)
|
the
Company has not issued or repaid any share capital or issued any debt
instrument;
|
|
(c)
|
the
Company has not declared or paid any dividend, group contribution or made
any other distribution (including but not limited to repayment of
conditional contributions) to the Seller or any other
Person;
|
|
(d)
|
the
Company has not entered into any transaction, arrangement or
agreement with the Seller, other than as contemplated by this Agreement,
and no payments have been made or agreed to be made by the Company to the
Seller or any of its Affiliated Persons other than pursuant to commercial
arrangements in the ordinary course of
business;
|
|
(e)
|
none
of the Material Agreements have been amended or terminated and there has
been no agreement to amend or terminate such
agreements;
|
|
(f)
|
there
has not occurred any change in the financial condition, any extraordinary
event, loss, damage (whether covered by insurance or not) or any waiver of
any debts, claims, or rights of substantial value which separately or
jointly has resulted in, or may result in, a Material Adverse
Effect;
|
|
(g)
|
the
Company has not sold, acquired, invested in, assigned, transferred,
pledged or otherwise encumbered, leased or otherwise disposed of any asset
– or borrowed any additional funds, assumed or incurred any liability,
obligation, expenditure or
commitment.
|
|
(h)
|
The
Company has not repaid any of its loans existing as at the Accounts Date,
other than as required in the agreements governing such loans or in the
ordinary course of business;
|
|
(i)
|
there
has been no change of accounting methods, principles or practices or
working capital principles or
practices;
|
|
(j)
|
the
Company has not deferred any payments to creditors beyond the agreed date
of payment;
|
|
(k)
|
the
Company has not amended its principles for debt collection to the effect
that payments from debtors are
accelerated;
|
|
(l)
|
all
Taxes have been paid when due;
|
|
(m)
|
there
has been no investments in fixed
assets;
|
|
(n)
|
the
Company has not amended its articles of association and has not passed any
resolution in shareholders’ meetings (other than any resolution
constituting ordinary business conducted at an annual shareholders’
meeting or as required in connection with this
Agreement);
|
|
(o)
|
the
Company has not created any Encumbrance over any of its
assets;
|
|
(p)
|
the
Company has not settled or waived any material
claim;
|
|
(q)
|
the
Company has not instituted any litigation proceedings or settled or waived
any claim other than in relation to the collection of trade
debts;
|
|
(r)
|
the
Company has not entered into voluntary liquidation;
and
|
|
(s)
|
neither
the Seller nor the Company have agreed or arranged to do any of the
foregoing.
|
|
Covenants
of the Seller
|
|
Restrictive
Covenant
|
|
7.1.1
|
The
Seller, directly or indirectly, undertakes at all times for a period
of from the Closing Date not to, without the written consent of the
Buyer, assist or have any active interest in, own any assets or shares in
or act as agent or as adviser or consultant to or otherwise enter into any
relationship with any customer or supplier of any of the Company, the
Buyer or the EXFO Group, or to carry out any other activities which
compete with the Business. NOTE 2
|
NOTE 2: Contains confidential
information that would be prejudicial to the interests of EXFO.
|
7.1.2
|
The
Seller, directly or indirectly, undertakes at all times for a period
of from the Closing Date not to solicit the services of or endeavour
to entice away from the Company, the Buyer or the EXFO Group any of its
directors, managers or employees nor to employ any such person during such
period of time. NOTE 2
|
|
7.1.3
|
NOTE
2
|
|
Co-operation
by Seller
|
|
7.2.1
|
The
Seller shall, at any time and from time to time, whether before, at, or
after the Closing Date, execute and deliver any further instruments or
documents and, at its own cost, take all such further action as the Buyer
may reasonably request in order to consummate effectively the transaction
contemplated by this Agreement and to deliver to the Buyer legal title to
the Shares.
|
|
7.2.2
|
The
Seller shall take, or cause to be taken, all actions and to do, or cause
to be done, all things necessary to consummate and make effective as
promptly as possible the transaction contemplated by this Agreement and to
co-operate with the Buyer in connection with the foregoing, such as to
provide all information and documents required for the Buyer to complete
notification to the Competition Authorities. The Seller shall obtain the
authorisations, consents, orders and approvals of regulatory bodies and
officials that may be or become necessary for the performance of its
obligations pursuant to this Agreement and the completion of the
transaction contemplated by it. The Seller shall co-operate with the Buyer
and promptly seek to obtain such authorisations, consents, orders and
approvals as may be necessary for the performance of the Parties’
respective obligations pursuant to this
Agreement.
|
|
Breach
by the Seller
|
Should
the Seller violate any of the provisions set out in Sections 7.1.1 or 7.1.2
above, the Seller shall at the Buyer’s request pay liquidated damages. The
payment of liquidated damages or other damages does not affect the rights of the
Buyer to take other action in relation to a violation of the provisions herein,
including but not limited to injunctive relief as set out in section 18.2 below.
NOTES 1 AND 2
|
Covenants
of the Buyer
|
Subject
to approval of the auditor of the Company, the Buyer undertakes to cause those
Directors who retire in connection with this transaction to be granted discharge
from liability for their administration until the Closing Date (or the earlier
date of their retirement) at the next annual shareholders’ meeting of the
Company. For the avoidance of doubt, the grant of discharge in accordance with
this Section will not in any way release the Seller from its Warranties,
covenants and liabilities under this Agreement.
NOTE 1: Contains seller's
confidential information.
NOTE 2: Contains confidential
information that would be prejudicial to the interests of EXFO.
|
Indemnification
|
|
Indemnification
|
|
9.1.1
|
The
Seller shall be liable and shall indemnify the Buyer, and, after the
Closing, without duplication, the Company, from and against any and all
Losses.
|
|
9.1.2
|
NOTE
2
|
|
9.1.3
|
NOTE
2
|
|
9.1.4
|
The
Buyer may deduct the amount of any Loss from any Earn-Out payment owed by
the Buyer.
|
|
Limitation
of Indemnification
|
|
9.2.1
|
NOTE
2
|
|
9.2.2
|
NOTE
2
|
|
(a)
|
NOTE
2
|
|
(b)
|
NOTE
2
|
|
9.2.3
|
NOTE
2
|
NOTE 2: Contains confidential
information that would be prejudicial to the interests of EXFO.
|
9.2.4
|
NOTE
2
|
|
9.2.5
|
This
Section 9.2.5 shall not apply to any breach of Warranty in relation to
Section 6.1 (Corporate Existence and Power), 6.2 (Corporate Authorisation
and Non-Contravention) or 6.3 (Capitalisation and Title), above. Claims
for any such breach may be made by the Buyer without any
limitations.
|
|
Confidentiality
|
|
10.1
|
Each
Party undertakes not to use or disclose any Confidential Information
unless (i) required to do so by law or pursuant to any order of court or
other competent authority or tribunal (ii) required to do so by any
applicable stock exchange regulations or the regulations of any other
recognised market place (iii) such disclosure has been consented to by the
other Party in writing (such consent not to be unreasonably withheld) or
(iv) to its professional advisers (who are bound to such party by a duty
of confidentiality which applies to any information disclosed). If a Party
becomes required, in circumstances contemplated by (i) or (ii) to disclose
any information, the disclosing Party shall use its reasonable endeavours
to consult with the other Party prior to any such
disclosure.
|
|
10.2
|
Notwithstanding
Section 10.1 above, as from the Closing Date, the Buyer shall be entitled
to use and disclose any Confidential Information relating to the
Company.
|
|
Announcements
|
All press
releases, public announcements and public relations activities by the Parties
with regard to this Agreement or the transaction contemplated by it shall be
mutually approved by the Parties in advance of such release, announcement or
activity. A Party shall, however, not be prevented from, after reasonable
consultation with the other Party, disclosing such information which is required
under law or pursuant to any order of court or other competent authority or
tribunal or under any applicable stock exchange regulations or the regulations
of any other recognised market place.
Notwithstanding
the above, Seller shall not make any announcement whatsoever without the prior
written approval of the Buyer, which shall not be unreasonably
withheld.
|
Costs
|
Each
Party shall pay its own costs and expenses in connection with the preparation
and completion of the transaction contemplated by this Agreement and no such
costs or expenses shall be charged to or paid by the Company.
NOTE 2: Contains confidential
information that would be prejudicial to the interests of EXFO.
|
Entire
Agreement
|
This
Agreement represents the entire understanding and agreement between the Parties
with respect to the subject matter hereof and supersedes all prior negotiations,
understandings and agreements relating to the subject matter
hereof.
|
Amendments
and Waivers
|
This
Agreement may only be amended by an instrument in writing duly executed by the
Parties. No change, termination, modification or waiver of any provision, term
or condition of this Agreement shall be binding on the Parties, unless it is
made in writing.
|
Notices
|
|
15.1
|
All
notices, requests, demands, approvals, waivers and other communications
required or permitted under this Agreement must be in writing in the
English language and shall be deemed to have been received by a Party
when:
|
|
(a)
|
delivered
by post, unless actually received earlier, on the third Business Day after
posting, if posted within Sweden, or the fifth Business Day, if posted to
or from a place outside Sweden;
|
|
(b)
|
delivered
by hand, on the day of delivery;
|
|
(c)
|
delivered
by fax, on the day of dispatch if supported by a written confirmation from
the sender’s fax machine that the message has been properly
transmitted.
|
|
15.2
|
All
such notices and communications shall be addressed as set out below or to
such other addresses as may be given by written notice in accordance with
this Section.
|
NOTES 1
AND 3
NOTE 1: Contains seller's
confidential information.
NOTE 4: Contains third party
confidential information.
NOTES 1
AND 3
|
15.3
|
For
the purposes of this Agreement, “writing” or “written” shall include faxes
but not e-mails.
|
|
Assignments
|
No Party
may assign, delegate, sub-contract, or otherwise transfer or pledge or grant any
other security interest in or over any of its rights or obligations under this
Agreement without the prior written consent of the other Party, except that the
Buyer may transfer or assign, in whole or in part, to one or more of its
Subsidiaries from time to time the right to purchase all or a portion of the
Shares, provided that no such transfer will relieve the Buyer of its
obligations, or affect the rights of the Seller, under this Agreement.
Notwithstanding the above, the Buyer may pledge or grant security interests over
its rights under this Agreement for the purpose of financing the transaction
contemplated by this Agreement, including (a) any refinancing of the existing
indebtedness of the Company and (b) any other facilities provided to the Buyer
and/or the Company in addition to such financing.
|
Partial
Invalidity
|
If any
provision of this Agreement or the application of it shall be declared or deemed
void, invalid or unenforceable in whole or in part for any reason, the remaining
provisions of this Agreement shall continue in full force and effect. The
Parties shall seek to amend such void, invalid or unenforceable provisions and
thereby this Agreement in order to give effect to, so far as is possible, the
spirit of this Agreement and to achieve the purposes intended by the
Parties.
|
Governing
Law and Disputes
|
|
18.1
|
This
Agreement shall be governed by and construed in accordance with the laws
of Sweden.
|
|
18.2
|
Any
dispute, controversy or claim arising out of, or in connection with, this
Agreement, or the breach, termination or invalidity of the Agreement,
shall be finally settled by arbitration in accordance with the Arbitration
Rules of the Arbitration Institute of the Stockholm Chamber of Commerce
and the decision of the arbitrator(s) shall be final and binding upon the
Parties both as to law and to fact snd shall not be appealable to any
court in any jurisdiction. The Parties shall share the expense of the
arbitrator(s) equally, unless otherwise decided by the
arbitrator(s).
|
NOTE 1: Contains seller's
confidential information.
NOTE 4: Contains third party
confidential information.
Notwithstanding
the above, Buyer or EXFO shall have the right to initiate proceedings in any
competent court of law for the granting of interim measures, such as injunctions
or other actions to prevent, minimize or prohibit any threatened or ongoing
breach of this Agreement. NOTE 2
|
18.3
|
The
place of arbitration shall be Gothenburg, Sweden. The language to be used
in the arbitral proceedings shall be English. The arbitration shall be
conducted by one arbitrator unless either Party requests that an
arbitration tribunal composed of three (3) arbitrators shall adjuciate the
dispute and such Party shall be solely responsible for the expenses of the
two extra arbitrators, unless otherwise decided by the
arbitrators.
|
|
18.4
|
The
Parties undertake and agree that all arbitral proceedings conducted with
reference to this arbitration clause will be kept strictly confidential.
This confidentiality undertaking shall cover all information disclosed in
the course of such arbitral proceedings, as well as any decision or award
that is made or declared during the proceedings. Information covered by
this confidentiality undertaking may not, in any form, be disclosed to a
third party without the written consent of the other Party. This
notwithstanding, a Party shall not be prevented from disclosing such
information in order to safeguard in the best possible way his rights
vis-à-vis the other Party in connection with the dispute, or if the Party
is obliged to so disclose pursuant to statute, regulation, a decision by
an authority, a stock exchange contract or
similar.
|
|
18.5
|
In
case this Agreement or any part of it is assigned or transferred to a
third party, such third party shall automatically be bound by the
provisions of this arbitration
clause.
|
|
|
____________________
|
NOTE 2: Contains confidential
information that would be prejudicial to the interests of
EXFO.
This
Agreement has been duly executed in three (3) original copies, of which each of
the Parties has taken one (1) each.
NOTES 1, 2, 3 AND 4
NOTE 1: Contains seller's
confidential information.
NOTE 2: Contains confidential
information that would be prejudicial to the interests of EXFO.
NOTE 3: Contains third party
confidential information.
NOTE 4: Contains confidential
employee related information.
APPENDIX 4.4.1 -
Calculation of the Earn-outs
NOTE 2: Contains confidential
information that would be prejudicial to the interests of EXFO.
APPENDIX 4.6 - Competition Authorities
N/A
Appendix 6.3.2 - Share Capital of the Company
NOTE 1: Contains seller's
confidential information.
NOTE 2: Contains confidential
information that would be prejudicial to the interests of EXFO.
Appendix 6.4.1 -
Copies of the Company's articles of association, shareholders' register and
extracts from the relevant trade register
Appendix 6.5.2 -
Balance Sheet
NOTE 1: Contains seller's
confidential information.
NOTE 2: Contains confidential
information that would be prejudicial to the interests of EXFO.
Appendix 6.6.1 - Loans
and other Financial Facilities
NOTE 2: Contains confidential
information that would be prejudicial to the interests of EXFO.
Appendix 6.10.1 -
Leased Premises
N/A
Appendix 6.12.1 -
Material Agreements
NOTE 1: Contains seller's
confidential information.
NOTE 2: Contains confidential
information that would be prejudicial to the interests of EXFO.
NOTE 4: Contains confidential
employee related information.
Appendix 6.12.4 -
Obligations or Warranty Undertakings
NOTE 1: Contains seller's
confidential information.
NOTE 2: Contains confidential
information that would be prejudicial to the interests of EXFO.
NOTE 4: Contains confidential
employee related information.
Appendix 6.15.1 -
Intellectual Property
NOTE 1: Contains seller's
confidential information.
NOTE 2: Contains confidential
information that would be prejudicial to the interests of EXFO.
Appendix 6.15.5 - List of all litigation, proceedings,
investigations, claims or actions
NOTE 1: Contains seller's
confidential information.
NOTE 2: Contains confidential
information that would be prejudicial to the interests of EXFO.
Appendix 6.15.7 - Owned Intellectual Property or
Licensed Intellectual Property
NOTE 1: Contains seller's
confidential information.
NOTE 2: Contains confidential
information that would be prejudicial to the interests of EXFO.
NOTE 3: Contains third party
confidential information.
Appendix 6.17.1 - Employment matters
NOTE 1: Contains seller's
confidential information.
NOTE 4: Contains confidential
employee related information.
Appendix 6.17.2 - Employment Agreements
NOTE 2: Contains confidential
information that would be prejudicial to the interests of EXFO.
NOTE 4: Contains confidential
employee related information.
Appendix 6.19.1 - Litigation
NOTE 2: Contains confidential
information that would be prejudicial to the interests of EXFO.
Appendix 6.24.1 - Certain Events
NOTE 1: Contains seller's
confidential information.
NOTE 2: Contains confidential
information that would be prejudicial to the interests of EXFO.
This
patent transfer agreement (this “Patent Transfer Agreement”) is entered into on
5 February 2009
BETWEEN:
(1) Starta Eget Boxen 11629 AB,
under change of name to AWS Holding AB, a company duly incorporated and
organized under the laws of Sweden, Sweden (the “Seller”); and NOTE
1
(2) EXFO Electro-Optical
Engineering Inc., a company duly incorporated and organized under the laws of
Canada, having its registered address at 000 Xxxxx Xxxxxx, Xxxxxx City, Province
of Quebec, Canada, X0X 0X0 (the “Buyer”).
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1
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Background
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1.1
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The
Seller is the owner of all title, right and interest in and to certain
inventions, one of which is comprised by a pending patent application and
two of which are protected under issued
patents.
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1.2
The Buyer is interested in acquiring the Invention, the Patents,
the
Patent
Rights, the Background Documents and the Know-how, all as defined below.
Further, the Buyer, through a wholly owned subsidiary, is interested in
acquiring a company performing business relating to the Invention, the Patents,
the Patent Rights, the Background Documents and the Know-how, as defined below,
and has on the day of this Patent Transfer Agreement also entered into a share
transfer agreement regarding purchase of the shares of Picosolve AB, (the
“Company”) from Starta Eget Boxen 11629 AB and Xxxxxx X. Xxxxxxxxxx Xx. NOTE
1
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1.3
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The
Seller agrees to sell and the Buyer agrees to purchase the Invention, the
Patents, the Patent Rights, the Background Documents and the Know-how, as
defined below, on the terms and conditions set out in this
Agreement.
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2
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Definitions
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In
this Patent Transfer Agreement, the following definitions are
used:
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NOTE 1: Contains seller's
confidential information.
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“Affiliated Person” means
a closely related Person (Sw. närstående) as set
out in Chapter 21 § 1 of the Swedish Companies Act (Sw. Aktiebolagslagen
(2005:551)) or a Person directly or indirectly controlling,
controlled by or under common control with the Seller or the Buyer (as the
case may be);
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“Background Documents”:
means the tangible copy of all written and electronic communications
between any Person that were involved in claiming rights with respect to
the Patents including any patent agent involved in namely: (i) the
preparation of the Patents’ application; (ii) the filing of the Patents’
applications; (iii) the registration of the Patents; (iv) the maintenance
of the Patents; or (v) any other communication related to the Patents.
Notwithstanding Buyer obtaining such Background Documents in accordance
with the terms of this Patent Transfer Agreement, the Background Documents
shall maintain their confidential and privileged
status.
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“Business Day” means a
day when banks are open for general banking business in Sweden and in
Canada;
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“Buyer” means EXFO Electro-Optical
Engineering Inc.;
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“Confidential
Information” means any information of any kind or nature
whatsoever, whether written or oral, including, without limitation, this
Patent Transfer Agreement and financial information, trade secrets and
other information regarding the Buyer, the Invention, the Patents, the
Patent Rights, the Background Documents and/or the Know-how, which is not
know to the general public;
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“Earn-out” means the
purchase price for the Invention, the Patents, the Patent Rights, the
Background Documents and the Know-how including the First Earn-out, the
Second Earn-out, the Third Earn-out and the Fourth Earn-out and
as further set out in Section 3;
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“Earn-Out period” has
the meaning set out in section 3;
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“Effective Date” means
the date when this Patent Transfer Agreement becomes effective as set out
in Section 4;
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“Encumbrance” means any
mortgage, charge, pledge, lien, option or other security interest or
restriction of any kind, including any
licenses;
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“Invention” means the
inventions, as further described in the Patents, and all-optical phase
sensitive sampling arrangement that have or are yet to be
submitted;
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“Know-how” means the
knowledge, experience, data, drawings, models and descriptions and any
other information and knowledge concerning the Invention, the Patents and
the Patent Rights;
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“Net selling price”
means the price payable by the customer, exclusive of taxes,
freights, customs and other external
charges;
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“Open Source Software”
means software licensed under terms pursuant to which the software
licensed may be used, modified and/or redistributed in source code and/or
object code forms without the payment of a license fee, including but not
limited to those licensed approved by the Open Source Initiative (see
xxx.xxxxxxxxxx.xxx), such as the GNU General Public License (GPL), the GNU
Library or Lesser General Public License (LGPL), the Mozilla Public
Licence and the Apache License;
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“Party” means the Seller
or the Buyer, and “Parties” means the
Seller and the Buyer, collectively;
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”Patent
Rights”
means the Patents, as defined below, and all present and future patent
applications and issued patents in every country claiming priority from
the Patents including any extension, supplemental protection
certification, registration, confirmation, reissue, continuation,
divisional, continuation-in-part, re-examination or renewal thereof and
any and all present and future patent applications in relation to the
Invention;
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”Patents” NOTE
2
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“Person” means any
individual, firm, company, corporation or other corporate body,
government, state or agency of a state or any joint venture, trust,
association or partnership (general or limited), whether or not
incorporated, and whether or not its owners enjoy limited liability, and
any other legal entity;
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“Seller” means Starta
Eget Boxen 11629 AB, under change of name to AWS Holding
AB;
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“Technology” NOTE
2
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NOTE 2: Contains confidential
information that would be prejudicial to the interests of EXFO.
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“Valid Bookings” means
confirmed purchase orders, for products developed or based on the
Technology, received by the EXFO Group and accepted by the EXFO Group
under their normal business terms NOTE
2
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2
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Assignment
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2.1
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The
Seller hereby sells, transfers and conveys and the Buyer hereby acquires
all right, title and interest in and to the Invention, the Patents, the
Patent Rights, the Background Documents and the Know-how, including the
right to apply for intellectual property protection such as patent
protection in any country.
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2.2
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The
Seller shall always be of reasonable assistance and further execute free
of charge any document required in Buyer’s reasonable opinion for
protection of the Invention and all other documents which may be required
to perfect the Buyer’s title to the Invention, the Patents, the Patent
Rights, the Background Documents and the
Know-how.
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2.3
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The
Buyer shall bear the costs for filing, prosecuting and maintaining the
Patents and the Patent Rights incurred as from the Effective Date of this
Patent Transfer Agreement, including any fees payable to patent offices
for the assignment of the Patent
Rights.
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3
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Purchase
Price
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3.1 Earn-out; i.e First
Earn-out, Second Earn-out, Third Earn-out
and
Fourth Earn-out
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3.1.1
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The
purchase price for the Invention, the Patents, the Patent Rights, the
Background Documents and the Know-how shall consist of the First Earn-out,
the Second Earn-out, the Third Earn-out and the Fourth Earn-out NOTE
2
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NOTE 2: Contains confidential
information that would be prejudicial to the interests of EXFO.
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3.1.2
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NOTE
2
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3.1.3
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NOTE
2
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3.1.4
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NOTE
2
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3.1.5
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NOTE
2
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3.1.4
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NOTE
2
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3.2
Calculation of Earn-out
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3.2.1
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The
Buyer shall calculate earned Earn-Out for the respective period above
after the expiry of the period. The calculation shall be made in USD as
per the Buyer’s accounting system.
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Appendix 3.2.1 sets out an example of the
calculation of the Earn-out
amounts.
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NOTE 2: Contains confidential
information that would be prejudicial to the interests of EXFO.
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3.2.2
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The
Seller may audit the Buyers calculation of Earn-Out at any time through an
Independent Accounting Firm.
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3.3 Dates
for Payment of the Earn-out
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3.3.1
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NOTE
2
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3.3.2
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NOTE
2
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4
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Effective
Date
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This
Patent Transfer Agreement is effective as of the date of this Patent
Transfer Agreement.
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5
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Warranties
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The
Seller make the following warranties, all of which are made as as of the
Effective Date.
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5.1
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The
Seller is the exclusive owner of the Invention, the Patents,
the Patent Rights, the Background Documents and the Know-how with full
right of disposition and not subject to any Encumbrances, including
licenses.
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5.2
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The
Patents and the Patent Rights are subsisting, valid, enforceable and not
withdrawn, cancelled or abandoned. All Invention, Patents and Patent
Rights which may be registered have been duly registered. All application
fees and renewal fees for such Invention, Patents and Patent Rights have
been paid in full and the registrations and applications are in all other
respects being maintained and
asserted.
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5.3
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No
litigation, proceedings, investigations, claims or actions of such nature
are pending or are threatened in respect of the Invention, the Patents,
the Patent Rights and/or the
Know-how.
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5.4
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No
Person has been engaged, is engaging or is expected to engage
in any activity or use that infringes, misappropriates,
or otherwise violates or conflicts with the Invention, the Patents, the
Patent Rights and the Know-how.
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NOTE 2: Contains confidential
information that would be prejudicial to the interests of EXFO.
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5.5
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None
of the Invention, the Patents, the Patent Rights, the Background Documents
and/or the Know-how has been, is or is expected to become, subject to any
outstanding consents, settlements or judgments restricting the use of such
Invention, Patents, Patent Rights, the Background Documents and/or
Know-how or adversely effecting the commercial value of the right to such
Technology, Invention, Patents, Patent Rights and/or Know-how or that
would impair the validity or enforceability of such Invention, Patents,
Patent Rights and/or Know-how and the Seller, including the
Seller’s predecessors, has not granted, or is obliged to grant, any
licence, assignment or other right in respect of any Invention, Patents,
Patent Rights, the Background Documents and/or Know-how, or is obliged to
disclose any Technology, Invention, Patents, Patent Rights, the Background
Documents and/or Know-how to any
Person.
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5.6
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The
consummation of the transactions contemplated by this Patent Transfer
Agreement will not cause any impairment of any Invention,
Patents, Patent Rights, the Background Documents and/or
Know-how.
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5.7
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All
software used by the Seller, including the Seller’s predecessors, in
relation to the Invention, the Patents, the Patent Rights, the Background
Documents and/or the Know-how is free of all viruses, worms, Trojan horses
and other contaminants and does not contain any bugs, errors, or problems
of a material nature that disrupt its operation or have an adverse impact
on the operation of other software programs or operating
systems.
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5.8
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No
Open Source Software has been used in relation to the Invention, the
Patents, the Patent Rights, the Background Documents and/or the Know-how
and no product or item developed or distributed by the Company has been
distributed with, or is designed to link with or access in any way any
Open Source Software.
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5.9
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All
employees and consultants who contributed to the discovery or development
of any of the Invention, the Patents, the Patent Rights, the Background
Documents and/or the Know-how have fully and finally (without any
compensation remaining to be paid) assigned all rights to
such Invention, Patents, Patent Rights, the Background
Documents and/or Know-how to the
Seller.
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5.10
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No
public disclosure of the Invention or the Patents has been made that would
impair patentability of the Invention or the Patent, or validity of the
Patents or Patent Rights.
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6
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Confidentiality
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The
Seller undertakes not to use or disclose any Confidential Information
unless (i) required to do so by law or pursuant to any order of court or
other competent authority or tribunal (ii) required to do so by any
applicable stock exchange regulations or the regulations of any other
recognised market place (iii) such disclosure has been consented to by the
Buyer in writing (such consent not to be unreasonably withheld) or (iv) to
its professional advisers (who are bound to such party by a duty of
confidentiality which applies to any information disclosed). If the Seller
becomes required, in circumstances contemplated by (i) or (ii) to disclose
any information, the Seller shall use its reasonable endeavours to consult
with the Buyer prior to any such
disclosure.
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7
Announcements
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All
press releases, public announcements and public relations activities by
the Parties with regard to this Patent Transfer Agreement or the
transaction contemplated by it shall be mutually approved by the Parties
in advance of such release, announcement or activity. A Party shall,
however, not be prevented from, after reasonable consultation with the
other Party, disclosing such information which is required under law or
pursuant to any order of court or other competent authority or tribunal or
under any applicable stock exchange regulations or the regulations of any
other recognised market place.
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Notwithstanding
the above, the Seller shall not make any announcement whatsoever without
the prior written approval of the Buyer, which shall not unreasonably be
withheld.
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8
Costs
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Each
Party shall pay its own costs and expenses in connection with the
preparation and completion of the transaction contemplated by this Patent
Transfer Agreement.
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9
Entire Agreement
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This
Patent Transfer Agreement represents the entire understanding and
agreement between the Parties with respect to the subject matter hereof
and supersedes all prior negotiations, understandings and agreements
relating to the subject matter
hereof.
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10
Amendments and Waivers
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This
Patent Transfer Agreement may only be amended by an instrument in writing
duly executed by the Parties. No change, termination, modification or
waiver of any provision, term or condition of this Patent Transfer
Agreement shall be binding on the Parties, unless it is made in
writing.
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11 Notices
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All
notices, requests, demands, approvals, waivers and other communications
required or permitted under this Patent Transfer Agreement must be in
writing in the English language and shall be deemed to have been received
by a Party when:
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(a)
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delivered
by post, unless actually received earlier, on the third Business Day after
posting, if posted within Sweden, or the fifth Business Day, if posted to
or from a place outside Sweden;
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(b)
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delivered
by hand, on the day of delivery;
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(c)
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delivered
by fax, on the day of dispatch if supported by a written confirmation from
the sender’s fax machine that the message has been properly
transmitted.
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All
such notices and communications shall be addressed as set out below or to
such other addresses as may be given by written notice in accordance with
this Section.
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NOTES 1 AND 3
NOTE 1: Contains seller's
confidential information.
NOTE 3: Contains third party
confidential information.
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For
the purposes of this Patent Transfer Agreement, “writing” or “written”
shall include faxes but not
e-mails.
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12 Assignments
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No
Party may assign, delegate, sub-contract, or otherwise transfer or pledge
or grant any other security interest in or over any of its rights or
obligations under this Patent Transfer Agreement without the prior written
consent of the other Party, except that the Buyer may transfer or assign,
in whole or in part, to one or more of its group companies from time to
time the right to purchase all or a portion of the Invention, the Patents,
the Patent Rights, the Background Documents and/or the Know-how, provided
that no such transfer will relieve the Buyer of its obligations, or affect
the rights of the Seller, under this Patent Transfer
Agreement.
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13 Partial
Invalidity
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If
any provision of this Patent Transfer Agreement or the application of it
shall be declared or deemed void, invalid or unenforceable in whole or in
part for any reason, the remaining provisions of this Patent Transfer
Agreement shall continue in full force and effect. The Parties shall seek
to amend such void, invalid or unenforceable provisions and thereby this
Patent Transfer Agreement in order to give effect to, so far as is
possible, the spirit of this Patent Transfer Agreement and to achieve the
purposes intended by the Parties.
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14 Governing
Law and Disputes
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14.1
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This
Patent Transfer Agreement shall be governed by and in accordance with the
laws of Sweden.
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14.2
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Any
dispute arising out of or in connection with this Patent Transfer
Agreement shall be finally settled by arbitration in accordance with the
rules of the Arbitration Institute of the Stockholm Chamber of Commerce
and the decision of the arbitrator shall be final and binding upon the
Parties both as to law and to fact, and shall not be appealable to any
court in any jurisdiction. The Parties shall share the expenses of the
arbitrator equally, unless the arbitrator determines that expenses shall
be otherwise assessed.
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Notwithstanding
the above, the Buyer shall have the right to initiate proceedings in any
competent court of law for the granting of interim measures, such as
injunctions or other actions to prevent, minimize or prohibit any
threatened or ongoing breach of this Patent Transfer
Agreement.
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14.3
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The
place of arbitration shall be Göteborg, Sweden. The language to be used in
the arbitral proceedings shall be English. The arbitration shall be
conducted by one (1) arbitrator unless either Party requests that an
arbitral tribunal composed of three (3) arbitrators shall adjuciate the
dispute and such Party shall be solely responsible for the expenses of
theses arbitrators, unless theses arbitrators determine that expenses
shall be otherwise assessed.
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14.4
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The
Parties undertake and agree that all arbitral proceedings conducted with
reference to this arbitration clause will be kept strictly confidential.
This confidentiality undertaking shall cover all information disclosed in
the course of such arbitral proceedings, as well as any decision or award
that is made or declared during the proceedings. Information covered by
this confidentiality undertaking may not, in any form, be disclosed to a
third party without the written consent of the other Party. This
notwithstanding, a Party shall not be prevented from disclosing such
information in order to safeguard in the best possible way his rights
vis-à-vis the other Party in connection with the dispute, or if the Party
is obliged to so disclose pursuant to statute, regulation, a decision by
an authority, a stock exchange contract or
similar.
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14.5
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In
case this Patent Transfer Agreement or any part of it is assigned or
transferred to a third party, such third party shall automatically be
bound by the provisions of this arbitration
clause.
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_____________________
This
Patent Transfer Agreement has been duly executed in two (2) original copies, of
which each of the Parties have taken one (1) copy.
Place: Place:
Date: Date:
NOTES 2 AND 4
NOTE 2: Contains
confidential information that would be prejudicial to the interests of
EXFO.
NOTE 4: Contains
confidential employee related information.
Appendix
3.2.1
NOTE 2: Contains confidential
information that would be prejudicial to the interests of EXFO.
Page 54
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