EXHIBIT 10.22
ASSET PURCHASE AGREEMENT
This Asset Purchase Agreement (this "Agreement") is entered into as of
December 3, 2001 by and between Paradigm Genetics, Inc., a Delaware corporation
(the "Buyer") and PE Corporation (NY), a New York corporation, acting through
its Celera Genomics Group (the "Seller").
WHEREAS, Celera XxXxx is a business unit within the Celera Genomics
division of the Seller;
WHEREAS, XX XxXxx, Inc. ("XX XxXxx"), a Utah corporation, f/n/a Linkage
Genetics, Inc., is a wholly-owned subsidiary of the Seller;
WHEREAS, the Seller desires to sell and transfer to the Buyer and the Buyer
desires to purchase and acquire from Seller certain assets and liabilities
relating to the plant genotyping business of Celera XxXxx (such business, assets
and liabilities being the "Business") in exchange for shares of common stock of
the Buyer and other valuable consideration as hereinafter provided;
WHEREAS, contemporaneously with the execution of this Agreement, the
parties are also entering into a Stock Purchase Agreement (as hereinafter
defined);
WHEREAS, contemporaneously with the Closing hereunder, the parties are
entering into agreements with respect to the sublease of certain real estate and
a Registration Rights Agreement (as hereinafter defined); and
WHEREAS, the parties further desire by this Agreement to provide for
certain continuing covenants of the Seller to and for the benefit of the Buyer,
all as hereinafter provided.
NOW, THEREFORE, in consideration of the promises and the mutual covenants
and agreements contained herein and for other good and valuable consideration,
the receipt and sufficiency of which are hereby mutually acknowledged, the
parties hereto agree as follows:
ARTICLE I -- PURCHASE AND SALE OF ASSETS
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1.01 Transferred Assets. Upon the terms and subject to the conditions set
forth in this Agreement, at the Closing (as defined in Section 1.06) the Seller
(and to the extent necessary, XX XxXxx) shall transfer to the Buyer free and
clear of all claims, charges, liens, contracts, rights, options, security
interests, mortgages, encumbrances and restrictions whatsoever (collectively,
"Claims") all of the assets, properties, goodwill and rights owned by the Seller
listed on Schedule 1.01, but excluding the Excluded Assets, as defined in
Section 1.02 (collectively, the "Transferred Assets"), all with the intention
that the Business shall be transferred to the Buyer as a going concern.
The Seller (and to the extent necessary, XX XxXxx) shall transfer the
Transferred Assets to the Buyer pursuant to a Xxxx of Sale in substantially the
form attached hereto as Exhibit A (the "Xxxx of Sale") and such other documents
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or instruments as the Buyer or its counsel may reasonably request.
The Seller shall grant the Buyer a perpetual, royalty-free non-exclusive
license to (a) the Seller's Laboratory Information Management System in the form
of Exhibit B-1 (the "LIMS License") and (b) the Seller's SSR Discovery Pipeline
Software in the form of Exhibit B-2 (the "SSR Software License"). The Seller
shall cause XX XxXxx, Inc. to assign to the Buyer its limited, non-exclusive
sublicense from PE Applied Biosystems under certain patents owned by Roche
Molecular Systems, Inc. in an assignment in the form of Exhibit B-3 (the "PCR
License Assignment"). The Seller shall assign to the Buyer, or cause the
applicable Affiliate of the Seller to assign to the Buyer, (a) the Seller's
genescan software license in an assignment in the form of Exhibit B-4 (the
"Genescan Software License Assignment") and (b) the Seller's genotyping software
in an assignment in the form of Exhibit B-5 (the "SNP Software License
Assignment", and together with the LIMS License, the SSR Software License, the
PCR License Assignment and the Genescan Software License Assignment, the
"Transferred Licenses").
1.02 Excluded Assets. The Transferred Assets shall not include those assets
identified or described on Schedule 1.02 (the "Excluded Assets").
1.03 Consideration for the Transferred Assets.
(a) Amount of Purchase Price. In consideration for the transfer of the
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Transferred Assets and the execution and delivery of the Related Agreements, and
upon the terms and subject to the conditions set forth in this Agreement and the
Stock Purchase Agreement, the Buyer will issue to the Seller the Common Shares,
as such term is defined in the Stock Purchase Agreement.
The purchase price shall be allocated among the Transferred Assets pursuant
to Schedule 1.03. The Buyer and the Seller shall file all documents, including
information returns, income tax returns and other similar documents with
appropriate taxing authorities, and the Asset Acquisition Statement on Form 8594
required by Section 1060 of the Internal Revenue Code of 1986, as amended,
consistent with the allocation set forth on Schedule 1.03.
(b) Method of Payment of Purchase Price. The Common Shares shall be issued
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by the Buyer to the Seller in the manner set forth in the Stock Purchase
Agreement.
1.04 Further Assurances. At any time and from time to time after the
Closing Date, at the request of the Buyer and without further consideration, the
Seller (or to the extent necessary, XX XxXxx or any other Affiliate of the
Seller) will execute and deliver such other instruments of sale, transfer,
conveyance, assignment and confirmation as may be reasonably requested in order
to more effectively transfer, convey and assign to the Buyer and to confirm the
Buyer's title to the Transferred Assets.
1.05 Assumption of Liabilities. The only obligations and liabilities to be
assumed by the Buyer in connection with its acquisition of the Transferred
Assets (the "Assumed Liabilities") are (i)
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the obligations specified under the executory contracts and work orders listed
on Schedule 1.05 (the "Assigned Contracts") (provided such contracts and work
orders are assigned to the Buyer in writing by the Seller and the other parties
thereto, if necessary, and provided such contracts and assignments are delivered
on or prior to the Closing Date), other than obligations (A) arising thereunder
as a result of any breach of or default under any such contract by the Seller
prior to the Closing, or as to any continuing obligations of the Seller, after
the Closing or (B) incurred on account of the operation of the Business by the
Seller prior to the Closing Date; (ii) obligations for performance by the Buyer
that arise after the Closing Date under the Transferred Licenses, other than
obligations (A) arising thereunder as a result of any breach of or default by
the Seller prior to the Closing, or as to any continuing obligations of the
Seller, after the Closing or (B) incurred on account of the operation of the
Business by the Seller prior to the Closing Date; (iii) accounts payable of the
Seller (in an aggregate amount not to exceed $7,000) incurred in the ordinary
course of business and which relate to inventories and supplies being
transferred to the Buyer hereunder; and (iv) those liabilities and obligations
of the Buyer arising out of its operation or ownership of the Transferred Assets
after the Closing Date. Except for the Assumed Liabilities, the Buyer shall not
assume or be responsible for any liabilities or obligations of the Seller,
including any which relate in any manner to the operation of the Business prior
to the Closing, and the Seller shall indemnify, defend, and hold the Buyer (and
its Affiliates and their respective officers, directors and employees) harmless
from all of such obligations and liabilities in accordance with and to the
extent provided in Article VIII hereof. In furtherance of the foregoing, at the
Closing, the Seller and the Buyer shall enter into one or more Assignment and
Assumption Agreements in substantially the form attached hereto as Exhibit C
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(the "Assignment and Assumption Agreement").
1.06 Closing. Subject to the satisfaction or waiver of each of the
conditions set forth in Articles VI and VII of this Agreement, the closing of
the transactions contemplated by this Agreement (the "Closing") shall take place
at the offices of Mintz, Levin, Cohn, Ferris, Glovsky and Popeo, P.C.
simultaneously with the Closing under the Stock Purchase Agreement at 10 o'clock
a.m. on December 7, 2001 or such other location, date and time as may be agreed
upon by the parties (such date and time being called the "Closing Date"). At the
Closing:
(a) The Seller shall deliver or cause to be delivered to the Buyer the
following:
(i) The Xxxx of Sale;
(ii) The certificates required by Sections 6.02 through 6.05 of this
Agreement;
(iii) The opinion of counsel required by Section 6.06 of this
Agreement;
(iv) A certificate of the Secretary of each of the Seller and XX
XxXxx, dated as of Closing Date, certifying as to (x) the accuracy and
completeness of the Certificate of Incorporation and By-Laws of the Seller
and XX XxXxx, respectively, which shall be attached as exhibits thereto and
(y) the incumbency of the officers of the Seller and XX XxXxx, respectively
executing this Agreement, the Related Agreements, and other documents,
certificates and instruments delivered hereunder to which each is a party
thereto;
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(v) Such books, data, documents, instruments and other records
(including, without limitation, laboratory notebooks and other notes) in
the possession of the Seller (collectively, "Records") relating to the
Transferred Assets and/or Business (except that the Seller shall deliver
copies rather than originals of those Records that Seller needs for its own
operations and that do not relate solely to the Business);
(vi) A certificate of recent date of the Secretary of State of the
State of New York as to the legal existence and good standing of the Seller
and a certificate of recent date of the Secretary of State of the State of
Utah as to the legal existence and good standing of XX XxXxx;
(vii) All consents required pursuant to Section 6.01 of this
Agreement;
(viii) The Seller's Laboratory Information Management System (the
"LIMS Software"), SSR Discovery Pipeline software (the "SSR Software"),
genescan software, genotyping software and sequencher software in all forms
currently held by the Seller; and
(ix) Such other documents, instruments or certificates as shall
reasonably be requested by the Buyer or its counsel to give effect to the
transactions contemplated hereby.
(b) The Buyer shall deliver or cause to be delivered to the Seller the
following:
(i) The Common Shares;
(ii) The certificates required by Sections 7.02 and 7.03 of this
Agreement;
(iii) A certificate of the Secretary of the Buyer, dated as of the
Closing Date, certifying as to (x) the resolutions of the Board of
Directors of the Buyer authorizing the execution and delivery of this
Agreement and transactions contemplated hereby, (y) the accuracy and
completeness of the Certificate of Incorporation and By-Laws of the Buyer
which shall be attached as exhibits thereto and (z) the incumbency of the
officers of the Buyer;
(iv) A certificate of recent date of the Secretary of State of
Delaware as to the legal existence and good standing of the Buyer; and
(v) Such other documents, instruments or certificates as shall
reasonably be requested by the Seller or its counsel.
(c) The parties shall deliver or cause to be delivered:
(i) The Assignment and Assumption Agreement and the Transferred
Licenses (to which each is a party);
(ii) A sublease agreement with respect to 0000 Xxxxxxx Xxxxxx,
Xxxxxx X xxx X, Xxxxx, Xxxxxxxxxx 00000 under two Standard Office Leases
between the Seller and Haussler
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Office Park, L.P. dated September 1, 1998 and June 15, 1994, respectively,
in substantially the form attached hereto as Exhibit D (the "Sublease");
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(iii) A registration rights agreement in the form attached hereto as
Exhibit E (the "Registration Rights Agreement"); and
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(d) The Xxxx of Sale, the Assignment and Assumption Agreement, the
Transferred Licenses, the Stock Purchase Agreement, the Sublease and the
Registration Rights Agreement are together sometimes referred to herein as the
"Related Agreements."
1.07 Intentionally Left Blank.
1.08 Nonassignable Contracts.
(a) To the extent that any Assigned Contract is not capable of being
assigned or transferred by the Seller to the Buyer pursuant to this Agreement
without the consent, approval or waiver of a third party (a "TP Approval"), and
such TP Approval is not obtained prior to the Closing, or if such assignment or
transfer or attempted assignment or transfer would constitute a breach thereof
or a violation of any law, decree, order, regulation or other governmental edict
in the absence of obtaining such a TP Approval, this Agreement shall not
constitute an assignment or transfer thereof, or an attempted assignment or
transfer of any such Assigned Contract. Each of the Buyer and the Seller shall
use reasonable efforts at its own expense to obtain such TP Approvals as soon as
practicable after the Closing Date; provided that neither the Seller nor the
Buyer shall be obligated to pay any money or grant additional consideration in
order to obtain such TP Approvals.
(b) Following the Closing Date, to the extent that any such TP Approvals
are not obtained by the Seller with respect to any Assigned Contracts, the
Seller shall remain a party to such Assigned Contracts until the applicable TP
Approvals are obtained, and the Seller and the Buyer shall cooperate with each
other to (i) provide to the Buyer the benefits, potential benefits and
obligations of any such Assigned Contract, (ii) establish, to the extent
practicable, arrangements, including subcontracting and the appointment of the
Buyer as the agent of the Seller for purposes of such Assigned Contract, that
are reasonable and lawful as to both the Seller and the Buyer, and which are
designed to provide the Buyer with the benefits, potential benefits and
obligations under such Assigned Contracts in accordance with the purpose and
intention of this Agreement, and (iii) enforce, at the request of the Buyer for
the account of the Buyer, any rights of the Seller arising from any such
Assigned Contract (except as such would conflict with Section 1.09 below).
1.09 Accounts Receivable. Payments by a customer of accounts receivable
with respect to the Business for work completed and billed prior to the Closing
Date ("Pre-Closing Work") received by the Buyer shall be paid over to the Seller
by Buyer promptly upon receipt. Payments by a customer of accounts receivable in
respect of the Business not constituting Pre-Closing Work ("Post-Closing Work")
received by the Seller shall be paid over to the Buyer promptly upon receipt.
Payments by a customer of accounts receivable with respect to the Business shall
be allocated among Pre-Closing Work and Post-Closing Work on a
first-in-first-out basis unless the customer otherwise indicates, and neither
Buyer nor Seller shall encourage, by discounts (other than in the ordinary
course) or otherwise, a customer to pay or allocate
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accounts receivable other than in the order in which billed. Notwithstanding the
foregoing, the parties agree that the account receivable described on Schedule
1.02(n) shall be allocated to the Seller, and if received by the Buyer shall be
paid over to the Seller by Buyer promptly upon receipt. In the event that
payments by a customer are subject to refund, then the party which was paid and
allocated the applicable payment shall be responsible for any such refund.
1.10 Meaning of "Seller" in Certain Sections of this Agreement. In each of
Section 1.08, Article II (except for Section 2.01), Article IV, Section 5.02(b),
Article VI and Article VIII, the term "Seller" shall refer to XX XxXxx together
with PE Corporation (NY), a New York corporation, acting through its Celera
Genomics Group. In the rest of this Agreement, the term "Seller" shall refer
only to PE Corporation (NY), a New York corporation, acting through its Celera
Genomics Group.
ARTICLE II -- REPRESENTATIONS AND WARRANTIES OF THE SELLER
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The Disclosure Schedule attached hereto (the "Disclosure Schedule")
identifies by Section and Subsection number any exception to a representation or
warranty in this Article II. As an inducement to the Buyer to enter into this
Agreement and the Related Agreements and to consummate the transactions
contemplated hereby and thereby, the Seller represents and warrants to the Buyer
as follows:
2.01 Organization; Subsidiaries. The Seller is a corporation duly
organized, validly existing and in good standing under the laws of the State of
New York and XX XxXxx is a corporation duly organized, validly existing and in
good standing under the laws of the State of Utah, and each is duly licensed or
qualified to transact business as a foreign corporation and is in good standing
in each jurisdiction in which the nature of the Business or the character of the
properties owned or leased by the Seller and/or XX XxXxx relating to the
Business or Transferred Assets requires such licensing or qualification, except
where the failure to so qualify would not have a Material Adverse Effect (as
defined in Section 2.06 below) on the Business or the Transferred Assets.
2.02 Corporate Power and Authority. The Seller has the corporate power and
authority to own and hold its properties relating to the Business or the
Transferred Assets and to carry on the Business as it is currently conducted and
proposed to be conducted. The Seller has the corporate power and authority to
execute, deliver and perform this Agreement, the Related Agreements, and the
other agreements, documents and instruments contemplated hereby and thereby. The
execution, delivery and performance of this Agreement, the Related Agreements
and the other agreements, documents and instruments contemplated hereby and
thereby and the consummation of the transactions contemplated hereby and thereby
have been duly authorized and approved by the Seller. This Agreement, the
Related Agreements and each of the other agreements, documents and instruments
to be executed and delivered by the Seller have been, or when executed and
delivered as contemplated herein will have been, duly executed and delivered by,
and constitute the legal, valid and binding obligations of, the Seller,
enforceable against the Seller, in accordance with their terms, except as such
enforcement may be limited by bankruptcy, insolvency or other similar laws
affecting the enforcement of creditors' rights generally and except that the
availability
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of equitable remedies is subject to equitable defenses and the discretion of
the court before which any proceeding therefor may be brought.
2.03 Validity, Etc. Neither the execution and delivery of this Agreement,
the Related Agreements or the other agreements, documents and instruments
contemplated hereby and thereby, the consummation of the transactions
contemplated hereby or thereby, nor the performance of this Agreement, the
Related Agreements and such other agreements in compliance with the terms and
conditions hereof and thereof will (i) violate, conflict with or result in any
breach of the Certificate of Incorporation or By-Laws of the Seller, (ii)
require any consent, approval, authorization or permit of, or filing with or
notification to, any governmental or regulatory authority, (iii) violate,
conflict with or result in a breach, default or termination or give rise to any
right of termination, cancellation or acceleration of the maturity of any
payment date of any of the obligations of the Seller (that are being assumed by
the Buyer pursuant to this Agreement) or increase or otherwise affect the
obligations of the Seller (that are being assumed by the Buyer pursuant to this
Agreement) under any law, rule, regulation or any judgment, decree, order,
governmental permit, license or order or any of the terms, conditions or
provisions of any mortgage, indenture, note, license, agreement or other
instrument or obligation related to the Seller (that are being assigned to or
assumed by the Buyer pursuant to this Agreement) or to the Seller's ability to
consummate the transactions contemplated hereby or thereby, except for such
defaults (or rights of termination, cancellation or acceleration) as to which
requisite waivers or consents have been obtained in writing and provided to the
Buyer, (iv) violate any judgment, order, writ, injunction, decree, statute, rule
or regulation applicable to the Business, the Transferred Assets or the Assumed
Liabilities or (v) result in the creation of any adverse claim upon the
Transferred Assets.
2.04 Financial Tables. The Seller has previously furnished to the Buyer,
and attached hereto as Schedule 2.04 are, the summary historical income table
dated August 13, 2001 (the "Income Table"), the table of historical revenue by
customer covering the fiscal year ended June 30, 2001 (the "Revenue Table") and
the table of operations for the fiscal year ended June 30, 2001 (the "Operations
Table," and together with the Income Table and the Revenue Table, the "Financial
Tables"). The Financial Tables were prepared in accordance with sound accounting
principles, consistently applied. The Financial Tables were prepared from the
books and records of the Seller, which books and records are complete and
correct in all material respects and accurately reflect all transactions of the
Business. The Financial Tables accurately present the information purported to
be contained therein as of the dates thereof. Since June 30, 2001, none of the
business, prospects, financial condition, operations, property or affairs of the
Business has been materially adversely affected by any occurrence or
development, individually or in the aggregate, whether or not insured against.
The Seller has disclosed to the Buyer all material facts relating to the
preparation of the Financial Tables, including the basis of accounting for
affiliated transactions.
2.05 Absence of Undisclosed Liabilities. Except as set forth on Schedule
2.05, the Seller does not have any liabilities or obligations (collectively,
"Liabilities") of any nature whatsoever relating to the Business or the
Transferred Assets, due or to become due, accrued, absolute, contingent or
otherwise.
2.06 Absence of Adverse Change; Conduct of Business. Since June 30, 2001,
(i) the Seller has conducted the Business only in the ordinary course of
business consistent with past
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practice, (ii) there has been no material adverse change in the Business, the
Transferred Assets or the condition (financial or otherwise), results of
operations or prospects of the Business (a "Material Adverse Effect") and (iii)
there is no known condition or development of any kind existing, or which, so
far as reasonably can be foreseen by the Seller, is likely to result in any such
change. Without limiting the foregoing, since June 30, 2001, there has not
occurred:
(a) Any damage, destruction or loss to any Transferred Asset or Shared
Asset (whether or not covered by insurance) that, individually or in the
aggregate, would have a Material Adverse Effect;
(b) Any change in the business or operations of the Business or in the
manner of conducting the Business or sale or other disposition of any right,
title or interest in or to any Transferred Assets or any revenues derived
therefrom other than in the ordinary course of business;
(c) Any increase in any compensation or benefits payable to any employees
of the Seller set forth on Schedule 2.15, other than increases in the ordinary
course of business consistent with past practice, or any payment or commitment
by the Seller to pay any bonus, pension, award, severance, termination or other
benefit to or for the benefit of any such employee of the Seller;
(d) Any material adverse change in Transferred Assets or the business or
prospects of the Seller with respect to the Business;
(e) Any loan, advance, agreement, arrangement or transaction between the
Seller and the employees of the Seller listed on Schedule 2.15, or any business
or entity in which the Seller, its Affiliates, or to the Seller's knowledge, any
such employee has any direct or indirect interest, except for compensation and
advances made to employees for ordinary and customary business expenses in
reasonable amounts in the ordinary course of the Business consistent with past
practice;
(f) Any (i) sale, assignment or transfer of any of the tangible assets that
are or were material to the Business or that, except in the ordinary course of
business consistent with past practice, are or were used exclusively in the
Business, or, (ii) cancellation of any debt or claim owing to or owed by the
Seller with respect to the Business, except in the ordinary course of business
consistent with past practice;
(g) Any sale, assignment, transfer or grant of any license or sublicense
with respect to any patent, patent application, trademark, trade name, service
xxxx, copyright, trade secret or other intangible asset used exclusively in or
material to the Business;
(h) Any material transaction with respect to the Business or the
Transferred Assets, except for transactions that do not involve payments or
expenditures by or to the Seller in excess of $15,000;
(i) Any material amendment or modification of any material contract,
agreement, franchise, permit, or license included in or relating to the
Transferred Assets or otherwise relating to the Business; or
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(j) Any commitment (contingent or otherwise) to do any of the foregoing.
2.07 Intentionally Left Blank.
2.08 No Broker or Finder. No broker, finder or other financial consultant
has acted on behalf of the Seller in connection with this Agreement or the
transactions contemplated hereby in such a way as to create any liability.
2.09 Taxes. Seller has filed or caused to be filed all tax returns
(including information returns and reports) relating to the operation of the
Business or the ownership or use of the Transferred Assets, except for any tax
returns subject to extensions of time within which to file, for all periods
ending on or before the Closing Date, and has paid or caused to be paid all
taxes (other than taxes that are not yet due and payable or which are being
contested in good faith), the non-filing or non-payment of which, as the case
may be, could result in the imposition of a claim as against Buyer with respect
to the Business or the Transferred Assets. Buyer shall have no liability as a
transferee or successor, by operation of law, contract or otherwise, for any
such taxes. For purposes hereof, the term "taxes" includes, without limitation,
any and all income, license, payroll, employment, excise, severance, stamp,
occupation, premium, environmental, accumulated earnings, property, sales, use,
transfer, franchise, value added, fuel, alternative or add-on minimum, estimated
and social security taxes and all interest and penalties thereon.
2.10 Litigation. There is no (a) action, suit, claim, proceeding or
investigation pending or, to the Seller's knowledge, threatened against or
affecting the Business or the Transferred Assets (whether or not the Seller is a
party or, to the Seller's knowledge, a prospective party thereto), at law or in
equity, or before or by any federal, state, municipal or other governmental
department, commission, board, bureau, agency or instrumentality, domestic or
foreign, (b) arbitration proceeding relating to the Business or Transferred
Assets or (c) governmental inquiry pending or, to the Seller's knowledge,
threatened against or involving the Seller relating to the Business or
Transferred Assets, and, to the Seller's knowledge, there is no reasonable basis
for any of the foregoing. There are no outstanding orders, writs, judgments,
injunctions or decrees of any court, governmental agency or arbitration tribunal
against, involving or affecting the Transferred Assets or the Business, and, to
the Seller's knowledge, there are no facts or circumstances which are reasonably
likely to result in institution of any action, suit, claim or legal,
administrative or arbitration proceeding or investigation against, involving or
affecting the Transferred Assets or the Business or the transactions
contemplated hereby. The Seller is not in default with respect to any order,
writ, injunction or decree known to or served upon it from any court or of any
federal, state, municipal or other governmental department, commission, board,
bureau, agency or instrumentality, domestic or foreign with respect to the
Transferred Assets or the Business. There is no action or suit by the Seller or
its Affiliates pending or threatened against others with respect to the
Transferred Assets or the Business.
2.11 Certain Practices. Neither the Seller nor any of its directors,
officers or employees has, directly or indirectly, given or agreed to give (in
connection, directly or indirectly, with respect to the Business) any
significant rebate, gift or similar benefit to any supplier, customer,
governmental employee or other person who was, is or may be in a position to
help or hinder the Seller (or assist in connection with any actual or proposed
transaction) which (i) could subject the
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Buyer to any damage or penalty in any civil, criminal or governmental
litigation or proceeding, or (ii) if not continued in the future, could have an
adverse effect on the Business.
2.12 Compliance with Law. The Seller has complied in all material respects
with and is not in default in any material respect under, all laws, ordinances,
legal requirements, rules, regulations and orders applicable to it, its
operations, properties, assets, products and services, including, without
limitation, all applicable Environmental Laws (as defined in Section 2.20(e)
hereof) and all applicable Employment Laws, that directly or indirectly impact
or relate to the Business or the Transferred Assets. As used in this Section
2.12, "Employment Laws" means legal requirements relating to matters such as
discrimination in employment or employment practices, unfair labor practices and
occupational safety or health standards including, without limitation, the
Occupational Safety and Health Act, 29 U.S.C. (S)(S) 651 et seq.; and the
Workers Adjustment and Retaining Notification Act, 29 U.S.C. (S)(S) 2101 et seq.
2.13 Licenses and Permits. Schedule 2.13 lists and describes all licenses,
permits, pending applications, consents, approvals and authorizations of or from
any public or governmental agency, used in or otherwise necessary in the conduct
of the Business, (collectively, the "Permits"). The Seller has complied in all
material respects with all conditions and requirements imposed by the Permits
and the Seller has not received any notice of, and has no reason to believe,
that any appropriate authority intends to cancel or terminate any of the Permits
or that valid grounds for such cancellation or termination exist. No other
permits are necessary to operate the Business as currently conducted by Seller.
The Seller owns or has the right to use the Permits in accordance with the terms
thereof without any conflict or alleged conflict or infringement with the rights
of others and subject to no claim, and each Permit is valid and in full force
and effect, and will not be terminated or adversely affected by the transactions
contemplated hereby, except as disclosed in Schedule 2.13.
2.14 Labor and Employee Relations. The Seller is not a party to or bound by
any collective bargaining agreement with any labor organization, group or
association covering any of its employees that are related to or impact the
Business, and the Seller has no knowledge of any attempt to organize any of such
employees by any person, unit or group seeking to act as their bargaining agent.
There are no pending or, to the Seller's knowledge, threatened charges (by
employees, their representatives or governmental authorities) of unfair labor
practices or of employment discrimination or of any other wrongful action with
respect to any aspect of employment of any person employed or formerly employed
by the Seller in connection with the Business. The Seller has not experienced
any work stoppages during the last three (3) years in connection with the
Business.
2.15 Employees. Set forth in Schedule 2.15 is a list of the names of the
Seller's employees and consultants who work substantially full-time in
connection with the Business, together with the title or job classification of
each such person and the base annual and the total compensation paid to each
such person by the Seller in the most recently completed fiscal year of the
Seller. None of such persons has an employment agreement or understanding
(including without limitation, non-competition, confidentiality, non-disclosure
and assignment of inventions agreements), whether oral or written, with the
Seller (an "Employment Related Agreement") which is not terminable on notice by
the Seller or Buyer (after the Closing) without cost or other liability to
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the Buyer, and any Employment Related Agreements are listed on Schedule 2.15.
No person listed on Schedule 2.15 has indicated in writing (including by e-mail)
that he or she intends to terminate his or her employment with the Seller or
seek a material change in his or her duties or status, either as a result of the
transactions contemplated by this Agreement or otherwise.
2.16 Employee Benefits. Set forth on Schedule 2.16 is a list of all
pension, profit sharing, retirement, deferred compensation, stock purchase,
stock option, incentive, bonus, vacation, severance, disability,
hospitalization, medical insurance, life insurance, fringe benefit, welfare and
other employee benefit plans, programs or arrangements to which employees of the
Seller who work on, for or in connection with the Business participate
("Employee Plans"). The Seller will maintain the benefits listed on Schedule
2.16 in full force and effect through the Closing Date, and thereafter with
respect to events occurring on or prior to the Closing. The Buyer shall have no
obligation of any kind or nature for any compensation or benefits of any kind or
nature of the employees or consultants of the Seller for services rendered prior
to the Closing.
2.17 Tangible Properties. Schedule 2.17 contains a true and complete list
of all tangible personal property owned by or leased to the Seller that is used
in, proposed to be used in, or otherwise allocated to the Business as it is
currently conducted or proposed to be conducted (the "Tangible Personal
Property"). The Seller has good and marketable title free and clear of all
claims to the Tangible Personal Property listed as owned by the Seller, other
than liens for taxes not yet due and payable. With respect to Tangible Personal
Property leased by the Seller as lessee, all leases, conditional sale contracts,
franchises or licenses pursuant to which the Seller may hold or use (or permit
others to hold or use) such Tangible Personal Property are valid and in full
force and effect, and there is not under any of such instruments any existing
default or event of default or event which with notice or lapse of time or both
would constitute such a default. The Seller's possession and use of such
property has not been disturbed and no claim has been asserted against the
Seller adverse to its rights in such leasehold interests. All Tangible Personal
Property is adequate and usable for the purposes for which it is currently used
and has been properly maintained and repaired and each item of Tangible Personal
Property, whether owned or leased, is in good operating condition and repair and
has been properly maintained, ordinary wear and tear excepted. During the past
three (3) years, there has not been any material interruption of the operations
of the Business due to the condition of any of the Tangible Personal Property.
2.18 Owned Premises. The Seller does not own the real estate on which the
Business is operated. The Transferred Assets do not include any real estate
owned by the Seller or any of its Affiliates.
2.19 Leased Premises. Schedule 2.19 sets forth a description of each parcel
of real property leased by the Seller and used in the Business (the "Leased
Parcel(s)"). The lease(s) covering the Leased Parcel(s) are in full force,
convey the leased real estate purported to be conveyed thereunder, and are
enforceable by the Seller. The Seller has the right to use the Leased Parcel(s)
in accordance with the terms of such lease(s) free and clear of all claims or
other interests or rights of third parties, except those which do not or would
not have a material adverse effect on the Leased Parcel(s) as used in the
Business. To the Seller's knowledge, each structure located on the Leased
Parcel(s) is structurally sound, adequately maintained and is in good condition
and repair consistent with the uses to which it is presently being put or
intended to be put. To the Seller's
11
knowledge, all structures, improvements and fixtures on the Leased Parcel(s)
and the current uses of the Leased Parcel(s) conform to any and all applicable
federal, state and local laws, building, health and safety and other ordinances,
laws, rules and regulations. No notice from any governmental authority or other
person has been received by the Seller claiming any violation of any such
ordinance, law, rule or regulation, or requiring any substantial work, repairs,
reclamation, construction, alterations or installation on or in connection with
the Leased Parcel(s) or any structure, improvement or fixture thereon which has
not been complied with or that any right of access or other right employed by
the Seller is being modified or terminated. There is no violation of any
material covenant, restriction or other agreement or understanding, oral or
written, affecting or relating to title or use of the Leased Parcel(s). There
are no pending or, to the Seller's knowledge, threatened condemnation or similar
proceedings or assessments affecting the Leased Parcel(s), nor to the Seller's
knowledge is any such condemnation or assessment contemplated by any
governmental authority.
2.20 Environmental Matters.
(a) The Seller and all premises occupied and used by the Seller in
connection with the Business (the "Premises") are in compliance with all
applicable Environmental Laws (as hereinafter defined), rules, regulations,
orders, ordinances, judgments and decrees of all governmental authorities
(federal, state, and local) relating to environmental matters. There is no, and
Seller has not received any written notice of any, and to the Seller's knowledge
it has not received any other notice of any, claim, action, demand, suit,
proceeding, hearing, study or investigation, based on or related to the
disposal, storage, handling, manufacture, processing, distribution, use,
treatment, or transport, or the emission, discharge, release or threatened
release into the environment, of any Substances (as hereinafter defined) in
connection with the Business or the Premises. No part of the premises occupied
or used by the Seller has been listed or proposed for listing on the National
Priorities List of the United States Environmental Protection Agency or any
other such list.
(b) No event has occurred or condition exists or operating practice is
being employed (in connection with the Business or the Premises) that could give
rise to liability on the part of the Seller, either at the present time or in
the future, for any losses, liabilities, damages (whether consequential or
otherwise), settlements, penalties, interest, expenses and costs of responses
(including any such liability on account of the right of any governmental or
private entity or person, and including closure expenses, costs of assessment,
containment, removal or response (other than monitoring transportation or
disposal of materials required to be transported or disposed of in the ordinary
course of business consistent with past practice) arising under any rule or
federal, state, or local statute, or any regulation that has been promulgated
pursuant thereto, or common law, as a result of or in connection with, or
alleged to be as a result of or in connection with, the following:
(i) The handling, storage, use, transportation or disposal of any
Substances in or near or from facilities or plants used by the Seller or
its predecessors (in connection with the Business or the Premises);
(ii) The handling, storage, use, transportation or disposal of any
Substances by the Seller or its predecessors (in connection with the
Business or the Premises) which Substances were a product, by-product or
otherwise resulted from the operations conducted
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by or on behalf of the Seller or its predecessors (in connection with the
Business or the Premises);
(iii) Any intentional or unintentional emission, discharge or release
of any Substances in or near or from facilities or plants of the Seller
(used in connection with the Business or the Premises) into or upon the
air, surface water, ground water or land or any disposal, handling,
manufacturing, processing, distribution, use, treatment, or transport of
such Substances in or near or from facilities or plants (used in connection
with the Business or the Premises) by or on behalf of the Seller or its
predecessors; or
(iv) The presence of any toxic or hazardous building materials
(including but not limited to asbestos or similar substances) in any
facilities or plants of the Seller (used in connection with the Business or
the Premises), including but not limited to the inclusion of such materials
in the exterior and interior walls, floors, ceilings, tile, insulation or
any other portion of building structures.
(c) The Seller has obtained and holds all registrations, permits, licenses,
and approvals issued by or on behalf of any federal, state or local government
body or agency ("Environmental Permits"), that are required in connection with
the construction or operation of the facilities or plants of the Seller (used in
connection with the Business), discharge or emission of Substances from such
facilities or plants or the generation, treatment, storage, transportation, or
disposal of any such Substances. Such Environmental Permits, which are listed
and described in Schedule 2.20, are currently effective and sufficient for the
ownership and operation of the facilities and plants and the operations of the
Seller (used in connection with the Business) as currently conducted. The Seller
is in full compliance with all terms and conditions of the required permits,
licenses and authorizations, and are also in full compliance with all other
limitations, restrictions, conditions, standards, prohibitions, requirements,
obligations, schedules, and timetables contained in those laws or provisions or
contained in any regulation, code, plan, order, decree, judgment, notice or
demand letter issued, entered, promulgated or approved thereunder and applicable
to the Business or the Transferred Assets.
(d) The Seller has delivered to the Buyer true and complete copies and
results of any reports, studies, analyses, tests, or monitoring possessed or
initiated by the Seller pertaining to Substances or hazardous activities in, on,
or under the premises used by the Seller in connection with the Business, or
concerning compliance with Environmental Laws by the Seller or any person or
business entity for whose conduct the Seller is or may be held responsible in
connection with the Business.
(e) As used in this Section 2.20, (i) "Environmental Laws" means legal
requirements designed to minimize, prevent, punish, or remedy the consequences
of actions that damage or threaten the environment (including soil, land surface
or subsurface strata, surface waters, ground waters, drinking supply, stream
sediments, ambient air, plant and animal life, and any other environmental
medium or environmental natural resource) or public health and safety and (ii)
"Substances" means any substance that is at any time defined or listed in, or
otherwise classified pursuant to any applicable Environmental Law or legal
requirement or order, as a "hazardous substance", "hazardous materials",
"hazardous air pollutant", "extremely hazardous
13
substance", or " hazardous waste", "toxic substance", "toxic pollutant", or any
other formulation intended to define, list or classify substances by reason of
their potentially deleterious properties such as ignitability, flammability,
corrosivity, reactivity, combustibility, dispersability, volatility,
carcinogenicity, toxicity, reproductive toxicity, or "EP toxicity", including
without limitation, asbestos, polychlorinated biphenyls and also including
petroleum products, by-products and wastes or by-products associated with the
extraction, refining or use of petroleum or petroleum products, whether or not
listed or classified in any such Environmental Law, legal requirement or order.
2.21 Insurance. The Seller is, and will be through the Closing, adequately
insured with responsible insurers in respect of the Transferred Assets and its
properties, assets and businesses relating to the Business against risks and in
amounts normally insured against by companies in similar lines of business under
similar circumstances. Schedule 2.21 correctly describes (by type, carrier,
limits, and expiration date) the insurance coverage carried by the Seller with
respect to the Transferred Assets or the Business, which insurance will remain
in full force and effect with respect to all events occurring prior to the
Closing.
2.22 Material Agreements. Schedule 2.22 sets forth a list of all existing
contracts, agreements, work orders, commitments, licenses and franchises
(collectively "Material Agreements"), whether written or oral, relating to the
Transferred Assets or the Business. The Seller has delivered or made available
to the Buyer true, correct and complete copies of all of the Material Agreements
specified on Schedule 2.22 which are in writing, and Schedule 2.22 contains an
accurate and complete description of all Material Agreements which are not in
writing. The Seller has paid in full all amounts due as of the date hereof under
each Material Agreement identified in Schedule 2.22 and will satisfy in full all
of its liabilities and obligations thereunder when such liabilities and
obligations are due. All of the Material Agreements described in Schedule 2.22
are in full force and effect. The Seller and, to the knowledge of the Seller,
each other party thereto have performed all the obligations required to be
performed by them to date, have received no written notice of default or, to the
Seller's knowledge, any other notice of default and are not in default (with due
notice or lapse of time or both) under any Material Agreement. The Seller has no
present expectation or intention of not fully performing all its obligations
under each Material Agreement, and the Seller has no knowledge of any breach or
anticipated breach by the other party to any contract or commitment to which the
Seller is a party. None of such Material Agreements has been terminated, no
notice has been given by any party thereto of any alleged default by any party
thereunder, and the Seller is not aware of any intention or right of any party
to default another party to any such Material Agreement. There exists no actual
or, to the knowledge of the Seller, threatened termination, cancellation or
limitation of the business relationship of the Seller with any party to any such
Material Agreement. None of the Seller's rights under any Material Agreement
will be impaired by the consummation of the transactions contemplated hereby,
and all of the rights of the Seller thereunder will be enforceable by the Buyer
immediately after the Closing without the consent or agreement of any other
party, except as set forth on Schedule 2.22.
2.23. Intellectual Property. Schedule 2.23 sets forth a list of all patents
and patent applications, as well as all material recipes, inventions, know-how,
show-how, designs, trade secrets, copyrights, trademarks, tradenames,
servicemarks, manufacturing processes, formulae, trade secrets, technology or
the like, and all applications for any of the foregoing, (collectively
14
"Intellectual Property") owned, controlled, licensed, subject to license or
used by the Seller and used, proposed to be used or allocated to the Business
("Business IP"), together in each case with a brief description of the nature of
such right. All patents and trademarks listed in Schedule 2.23 are valid and in
full force and all applications listed therein as pending have been prosecuted
in good faith as required by law and are in good standing. The Seller has
delivered or made available to the Buyer true and complete copies of all of such
Intellectual Property rights to the extent embodied in any writing, including,
without limitation, all applications, licenses, commitments and other
agreements, including all amendments and supplements thereto and modifications
thereof, and Schedule 2.23 includes a description of any such item that is not
in writing. Neither the Seller nor its Affiliates has infringed the intellectual
property rights of others in connection with the Business or the Transferred
Assets. The Seller owns or possesses adequate licenses or other rights to use
all Intellectual Property used by it or reasonably necessary to conduct the
Business as conducted prior to the Closing or proposed to be conducted. After
the Closing, without being transferred any of the Business IP, the Buyer shall
be able to conduct the Business as it is currently conducted without violating
the Business IP or other Intellectual Property. None of the Intellectual
Property listed or described in Schedule 2.23 is involved in any interference or
opposition proceeding, and there has been no written notice received by the
Seller or any of its Affiliates that any such proceeding will hereafter be
commenced. The Seller and its Affiliates have used all reasonable efforts to
maintain the Business IP and to preserve their trade secrets and confidential or
proprietary information relating to the Business and/or the Transferred Assets.
The Seller does not have any basis for provoking or initiating an interference
or opposition proceeding with respect to any Intellectual Property held or used
by others, and does not have any basis for believing that any of the
Intellectual Property listed in Schedule 2.23 is being infringed by others.
Except as set forth on Schedule 2.23, to the best of the Seller's knowledge,
none of the Seller's patents or patent applications related to the Business or
Transferred Assets is involved in an interference. Except as described in
Schedule 2.23, the Seller has not granted any person or entity any right to use
any of the Business IP for any purpose.
2.24 Proprietary Information of Third Parties. No third party has claimed
or to the best of Seller's knowledge has reason to claim that any person
employed by or affiliated with the Seller in connection with the Business or the
Transferred Assets has (a) violated or may be violating any of the terms or
conditions of such person's employment, non-competition or non-disclosure
agreement with such third party, (b) disclosed or may be disclosing or utilized
or may be utilizing any trade secret or proprietary information or documentation
of such third party, or (c) interfered or may be interfering in the employment
relationship between such third party and any of its present or former
employees. To the Seller's knowledge, no person employed by or affiliated with
the Seller in connection with the Business or the Transferred Assets has
employed or proposes to employ any trade secret or any information or
documentation proprietary to any former employer and, to the Seller's knowledge,
no person employed by or affiliated with the Seller has violated any
confidential relationship which such person may have had with any third party,
in connection with the development, manufacture or sale of any product or
proposed product or the development or sale of any service or proposed service
of the Business, and the Seller has no reason to believe there will be any such
employment or violation. To the best of the Seller's knowledge, none of the
execution or delivery of this Agreement or any of the Related Agreements, the
carrying on of the Business as officers, employees or agents by
15
any agent, consultant or employee of the Business, or the conduct of the
Business, will conflict with or result in a breach of the terms, conditions or
provisions of or constitute a default under any contract, covenant or instrument
under which any such person is obligated.
2.25 Significant Customers and Suppliers. Set forth on Schedule 2.25 is a
list of the ten largest customers and ten largest suppliers (with sales to the
Business in excess of $7,000) of the Business for the twelve months preceding
October 31, 2001, together with the amount of sales or purchases attributable to
such customers or suppliers expressed in dollars and as a percentage of total
sales or purchases, as the case may be. Except as set forth on Schedule 2.25, no
customer or supplier listed on Schedule 2.25 has terminated, materially reduced
or, to the Seller's knowledge, threatened to terminate or materially reduce its
purchases from or provision of products or services to the Seller.
2.26 Governmental and Third Party Approvals. No registration or filing
with, or consent or approval of or other action by, any federal, state or other
governmental agency or instrumentality or any other third party is or will be
necessary for the valid execution, delivery and performance by the Seller of
this Agreement.
2.27 Title. Upon delivery to the Buyer of the Xxxx of Sale and the
Transferred Licenses, the Buyer shall receive good and valid title to the
Transferred Assets, free and clear of all liens, encumbrances, charges, rights,
options, security interests, mortgages, restrictions, equities and claims of
every kind.
2.28 Sufficiency of Assets. The assets listed on Schedule 1.01 are all of
the assets that are reasonably required to operate the Business consistent with
past practice.
2.29 Disclosure. All documents and schedules delivered or to be delivered
by or on behalf of the Seller in connection with this Agreement and any of the
Related Agreements and the transactions contemplated hereby and thereby are
true, complete and correct in all material respects. Neither this Agreement, nor
any Related Agreement contains any untrue statement of a material fact or omits
a material fact necessary to make the statements contained herein or therein, in
light of the circumstances in which made, not misleading.
16
ARTICLE III - REPRESENTATIONS AND WARRANTIES OF THE BUYER
---------------------------------------------------------
The Buyer represents and warrants to the Seller as follows:
3.01 Organization. The Buyer is duly incorporated, validly existing and in
good standing under the laws of the State of Delaware, and is duly qualified to
transact business as a foreign corporation in each jurisdiction in which the
failure to so qualify would have a material adverse effect on the Buyer's
ability to purchase the Transferred Assets and the Business.
3.02 Buyer Power and Authority. The Buyer has the corporate power and
authority to execute, deliver and perform this Agreement, the Related Agreements
and the other agreements, documents and instruments contemplated hereby. The
execution, delivery and performance of this Agreement, the Related Agreements
and the documents contemplated hereby and the consummation of the transactions
contemplated hereby and thereby have been duly authorized and approved by the
Buyer. This Agreement, the Related Agreements and each of the other agreements,
documents and instruments to be executed and delivered by Buyer have been, or
when executed and delivered as contemplated herein will have been, duly executed
and delivered by, and constitute the valid and binding obligations of the Buyer
enforceable against the Buyer in accordance with their terms except as such
enforcement may be limited by bankruptcy, insolvency or other similar terms
affecting the enforcement of creditors' rights generally and except that the
availability of equitable remedies is subject to the discretion of the court
before which any proceeding therefor may be brought.
3.03 Validity, Etc. Neither the execution and delivery of this Agreement,
the Related Agreements and the other agreements, documents and instruments
contemplated hereby and the consummation of the transactions contemplated hereby
or thereby, nor the performance of this Agreement, the Related Agreements and
such other agreements in compliance with the terms and conditions hereof and
thereof will (i) conflict with or result in any breach of the Certificate of
Incorporation or By-Laws of the Buyer, (ii) require any consent, approval,
authorization or permit of, or filing with or notification to, any governmental
or regulatory authority, (iii) result in a breach of or default (or give rise to
any right of termination, cancellation or acceleration) under any law, rule or
regulation or any judgment, decree, order, governmental permit, license or order
or any of the terms, conditions or provisions of any mortgage, indenture, note,
license, agreement or other instrument to which the Buyer is a party, or (iv)
violate any judgment, order, writ, injunction, decree, statute, rule or
regulation applicable to the Buyer.
3.04 No Broker or Finder. No broker, finder or other financial consultant
has acted on behalf of the Buyer in connection with this Agreement or the
transactions contemplated hereby in such a way as to create any liability.
ARTICLE IV - COVENANTS OF THE SELLER
------------------------------------
The Seller hereby covenants and agrees with the Buyer as follows:
4.01 Best Efforts Cooperation. The Seller shall use its best efforts in
good faith to perform and fulfill all conditions and obligations to be fulfilled
or performed by it hereunder and to
17
consummate the transactions contemplated hereby as promptly as practicable,
provided that the Seller shall not be obligated to pay any money or grant
additional consideration in order to obtain any TP Approval.
4.02 Access. Until the Closing, the Seller shall give the Buyer, its
attorneys, accountants and other authorized representatives full access, upon
reasonable terms and during regular business hours, to the Seller's offices,
properties, customers, suppliers, employees, products, technology, business and
financial records, contracts, business plans, budgets and projections,
agreements and commitments and other documents and information concerning the
Business, the Transferred Assets and the persons employed by or doing business
with the Seller in connection with the Business. Without limiting the generality
of the foregoing, with the prior approval of the Seller, the Buyer or its
representatives shall be permitted to visit customers and suppliers of the
Business for the purposes of checking references and obtaining other information
reasonably useful to the Buyer. In order that the Buyer may have full
opportunity to make such examination and investigation as it may desire of the
Business, the Seller will furnish the Buyer and its representatives during such
period with all such information as such representatives may reasonably request
and cause the respective officers, employees, consultants, agents, accountants
and attorneys of the Seller to cooperate fully with the representatives of the
Buyer in connection with such review and examination and to make full disclosure
to the Buyer of all material facts affecting the Transferred Assets, the
Business, the prospects of the Business and with respect to the Business only,
the Seller's financial condition, business operations and properties; provided,
however, that the Buyer will, through the Closing Date, hold the documents and
information concerning the Seller and the Business confidential in accordance
with Section 10.16 hereof. In addition to the foregoing, Seller agrees to
provide, upon Buyer's request, in particular:
(a) verification of receipts and expenses for calendar years 1998, 1999
and 2000 and accounts added or deleted since January 1, 2001 in connection with
Buyer's determination of current levels of receipts;
(b) verification of Business-related employees including wages and
benefits paid; and
(c) site visits to all accounts related to the Business.
4.03 Intentionally Left Blank.
4.04 Compliance with Laws. Until the Closing, the Seller shall conduct the
Business in compliance with all applicable laws, rules, regulations and orders.
4.05 Keeping of Books and Records. Until the Closing, the Seller shall keep
adequate records and books of account for the Business, in which accurate and
complete entries will be made in accordance with past practice, reflecting all
financial transactions and in which all proper reserves for depreciation,
depletion, obsolescence, amortization, taxes, bad debts and other purposes in
connection with its business shall be made.
4.06 Actions Prior to Closing. The Seller shall conduct the Business
pending the Closing only in the ordinary and usual course of the Business
consistent with past practice. Without
18
limiting the generality of the foregoing, the Seller will not (with respect to
the Business), except in the ordinary and usual course of the Business, without
the prior written consent of the Buyer, (i) make any acquisition or disposition
of assets, (ii) enter into any contract or release or relinquish any contract or
other right, or (iii) enter into or renew any employment agreement with any
employees or consultants or grant any increases in the compensation or benefits
to, or agree to pay any bonus, severance or termination payment or other special
compensation to any employees or consultants.
4.07 Litigation. The Seller will promptly notify the Buyer of any lawsuits,
claims, proceedings or investigations which are threatened or commenced against
or by the Seller or its Affiliates, or against any employee, consultant or
director of the Seller which claims relate to or impact the Business or the
Transferred Assets.
4.08 Continued Effectiveness of Representations and Warranties. From the
date hereof up to and including the Closing Date (i) the Seller will conduct the
Business in a manner such that the representations and warranties contained
herein shall continue to be true and correct on and as of the Closing Date as if
made on and as of the Closing Date, except for changes and the consequences of
events arising in the ordinary and usual course of business after the date
hereof and none of which would have an adverse effect on the Transferred Assets
or the properties, assets, operations or condition (financial or otherwise) or
prospects of the Business and (ii) the Seller will advise the Buyer promptly in
writing of any condition or circumstance occurring from the date hereof up to
and including the Closing Date which is reasonably likely to cause any
representations or warranty of the Seller to become untrue in any material
respect.
4.09 Obligations of Affiliates. Except as specifically set forth in this
Agreement, on or before the Closing Date, the Seller will, and the Seller will
cause its Affiliates to, (i) cause all debts, claims and other obligations owed
or required to be performed by the Seller relating to the Business or
Transferred Assets to any of its Affiliates, to be paid or discharged in full
and (ii) terminate any ongoing agreements relating to the Business or
Transferred Assets between it on the one hand and its Affiliates on the other,
all without any expense to the Buyer (or any reduction in or impairment to the
Transferred Assets) and so that following the Closing Date, Buyer shall have no
obligations of any kind or nature to the Seller or its Affiliates except for
those specified in this Agreement and the Related Agreements.
4.10 Certain Taxes, Tax Returns.
(a) All sales, use, transfer, filing, conveyance, bulk transfer, gross
income, gross receipts, business and occupation, value added or gross income
taxes or other taxes, duties, excises or governmental charges (except those on
or measured by Seller's net income) ("Transactional Taxes") imposed by any
taxing jurisdiction with respect to the sale, transfer or assignment of the
Transferred Assets to the Buyer or otherwise on account of this Agreement or the
transactions contemplated herein shall be borne equally by the Seller and Buyer.
Buyer shall provide Seller with appropriate exemption certificates or direct pay
certificates where possible. In the event either party shall be required to pay
any Transactional Taxes of which the other party is liable, the latter party
shall promptly reimburse the former party for its share of such Transactional
Taxes. In the event any taxing jurisdiction subsequently determines that any
19
additional Transactional Taxes (including interest and penalties) are due,
Buyer and Seller shall bear equally such Transactional Taxes.
(b) Seller shall be responsible for any taxes, including interest and
penalties thereon, which are attributable to operation and ownership of the
Transferred Asset for periods prior to the Closing. Buyer shall be responsible
for taxes, including interest and penalties, attributable to periods following
the Closing. Taxes requiring apportionment shall be prorated on the basis of the
calendar or fiscal year covered by such taxes or otherwise on a mutually
acceptable equitable basis. If Seller shall have paid taxes for which Buyer is
responsible as aforesaid, of if Buyer shall pay any taxes for which Seller is
responsible as aforesaid, appropriate adjustment will be made at or as
reasonably practicable after the Closing.
(c) Seller shall cause to be prepared and timely filed, at its sole
expense, all of its required tax returns that relate to the Business or the
Transferred Assets for all periods up to and including the Closing Date. Seller
and Buyer shall cooperate regarding the filing of any tax returns that cover a
period that includes the Closing Date. Property tax returns will be filed by the
party that owns on the assessment date the property subject to the return.
4.11 Payment of Liabilities. The Seller shall pay and satisfy in full (when
due) all of its liquidated obligations and liabilities associated with the
Business or the Transferred Assets (that are being assumed by the Buyer pursuant
to this Agreement), of any nature whatsoever, which accrued prior to the Closing
Date whether or not such obligations are due and payable as of or before the
Closing Date, except for accrued taxes.
4.12 No Negotiations. Until the later of January 30, 2002 or the written
notice of termination of discussions between the Buyer and the Seller, or until
the termination of this Agreement in accordance with its terms if earlier than
January 30, 2002, neither the Seller nor any of its directors, officers,
employees or representatives shall, directly or indirectly, initiate discussions
with, engage in negotiations with, solicit offers from, or provide any
information to any corporation, partnership, person or other entity or group
involving the possible sale, directly or indirectly, transfer or joint venture
of any part of the Transferred Assets or the Business to any person or entity
other than the Buyer; provided however, that the Seller may take such actions
with respect to transferring its interest in and obligations under the Sublease
and the Transferred Licenses in connection with the potential sale of the animal
genotyping business of Celera XxXxx.
4.13 Solicitation or Hiring. Except to the extent permitted pursuant to
Section 5.02(c), during the time that this Agreement shall remain in effect and
for a period of three years following the Closing, Seller agrees that neither
the Seller, any of its subsidiaries, nor any of their respective officers,
directors or agents shall take any action, formal or informal, direct or
indirect, to (i) solicit the employment or engagement of any of Buyer's
employees, consultants or independent contractors, (ii) hire or engage the
employees and consultants listed on Schedule 2.15, or (iii) solicit, induce,
-------------
entice or encourage any of Buyer's employees, consultants or independent
contractors to terminate their relationship with Buyer.
4.14 Employees. The Seller shall be solely responsible for all grievances,
arbitrations, claims, demands or charges relating to the employment of employees
by the Seller prior to the Closing, including, without limitation, any such
grievances, arbitrations, claims, demands or charges
20
whether now known or not yet made by any employees, bargaining agents or
governmental agencies, which result from or arise out of (i) any event relating
to such employment occurring prior to the time of Closing or (ii) any employment
terminations by the Seller on account of the transactions contemplated by this
Agreement. No employee or former employee of the Seller shall be construed to be
a third party beneficiary under this Section 4.15.
4.15 Use of Names. Until February 28, 2002, the Buyer may identify the
Business as being formerly part of "XX XxXxx" or "XxXxx" (and any variation of
such names). From and after March 1, 2002, except as consented to in writing by
the Seller, neither the Buyer nor any Affiliate of the Buyer shall use the names
"XX XxXxx" or "XxXxx" (or any variation of such names), nor any domain name,
trade name, trademark, logo or service xxxx of the Seller, none of which are
included in the Transferred Assets.
4.16 Intentionally Left Blank.
4.17 Transfer of Properties. The Seller shall not sell, lease, assign,
transfer or otherwise dispose of any of the Property (as defined in the Shared
Facilities Agreement) in which any portion of the Premises (as defined in the
Sublease) or a Common Area (as defined in the Sublease) is located. The Seller
shall not create or suffer to exist any Encumbrance (as defined in the Sublease)
upon or with respect to any of the Property in which any portion of the Premises
or a Common Area is located, other than Permitted Encumbrances (as defined in
the Sublease) and any mortgage permitted in accordance with the terms and
provisions of the Lease.
4.18 Access. At any time and from time to time after the Closing Date, the
Seller shall give access to the Buyer, its attorneys, accountants and authorized
representatives, upon reasonable notice and at reasonable times, without further
consideration and subject to reasonable confidentiality undertakings, to the
business, financial and personnel records and the other documents, records and
files relating to the Seller's conduct of the Business prior to the Closing Date
that were not transferred to the Buyer on the Closing Date, for purposes of
enabling the Buyer to conduct the Business as contemplated hereby, to defend or
prosecute claims and to comply with applicable Federal, state and local laws.
4.19 Confidentiality Agreements. As promptly as practicable after the
Closing Date, and from time to time with respect to employees hired after the
Closing Date, the Seller shall cause its employees who work in or have access to
the Property to sign the Seller's standard form of confidentiality agreement.
4.20 Certain Continuing Obligations Under Certain Assigned Contracts. At
any time and from time to time after the Closing, the Seller shall comply with
the requirement set forth in Schedule 4.20.
-------------
ARTICLE V - COVENANTS OF THE BUYER
----------------------------------
5.01 Cooperation. The Buyer shall use its best efforts in good faith to
perform and fulfill all conditions and obligations to be fulfilled or performed
by it hereunder and to consummate the transactions contemplated hereby within
thirty (30) days after the execution of this Agreement;
21
provided that the Buyer shall not be obligated to pay any money or grant
additional consideration in order to obtain any TP Approvals.
5.02 Hirees.
(a) Prior to the Closing, Buyer shall offer employment to each of the
persons listed on Table A of Schedule 2.15 (except for the employee referenced
as EE# 100434 on such table) upon terms which (i) provide for the same base
salary as in effect at the date of this Agreement, (ii) provide benefits
consistent with those offered to employees of the Buyer of similar grade and
responsibility, subject to eligibility requirements for such benefits, and (iii)
provide similar or higher job responsibilities. No provision of this Section
5.02 shall create any third-party beneficiary rights in any person or
organization, including without limitation, employees or former employees (or
any beneficiaries or dependents thereof) of the Seller or any of its Affiliates,
and trustees, administrators, participants or beneficiaries of any employee
benefit plan or arrangement, including the currently existing plans of the
Seller, and no provision of this Section 5.02 shall create third-party
beneficiary rights in any such person or organization in respect of any benefits
that may be provided, directly or indirectly, under any such employee benefit
plan or arrangement. Also, no provision of this Section 5.02 shall be construed
to mean that the Buyer must or shall employ or offer to employ the employees
listed on Schedule 2.15 on anything other than an at-will basis.
(b) The Seller releases Buyer and each of the persons listed on Schedule
2.15 from any (i) claims for interference with prospective economic advantage,
interference with contract, violation of any non-solicitation, non-hire,
non-competition, assignment of inventions or similar agreement between the
Seller and the Buyer, or any cause of action based on similar rights arising at
common law or by statute or regulation, or (ii) causes of action arising out of
or related to the obligations of any employee listed on Schedule 2.15 to the
Seller, including without limitation, duties under any confidentiality,
nondisclosure, noncompetition, assignment of inventions or similar agreements,
which would otherwise be violated in connection with the Buyer's employment or
solicitation for employment of any such employees, provided however, that the
Seller does not so release the persons listed on Schedule 2.15 from causes of
action arising out of breaches of their duties under confidentiality or
nondisclosure agreements involving the misuse of confidential information about
the Seller, it being understood that the good faith use of information after the
Closing in furtherance of such employees' performance of their employment duties
shall not constitute misuse.
(c) The parties agree to the provision set forth in Schedule 5.02(c).
ARTICLE VI - CONDITIONS TO THE BUYER'S OBLIGATIONS
--------------------------------------------------
The obligation of the Buyer to issue the Common Shares and to consummate
the other transactions contemplated hereby and in the Related Agreements is
subject to the satisfaction, on or before the Closing Date, of the following
conditions each of which may be waived by the Buyer in its sole discretion:
6.01 Consents; Corporate Authority. All requisite governmental approvals
and consents of third parties necessary for Sublease and the transfer of the
Transferred Licenses shall
22
have been obtained. All corporate actions necessary for the approval of the
transactions contemplated hereby by the Seller shall have been taken by the
Seller.
6.02 Representations and Warranties True. All of the representations and
warranties of the Seller contained in this Agreement or the Related Agreements,
in the Disclosure Schedule or other documents attached hereto or referred to
herein or delivered pursuant hereto or in connection with the transactions
contemplated hereby shall be true, correct and complete in all material respects
on and as of the date hereof and on and as of the Closing Date as if made on and
as of the Closing Date. On the Closing Date, the Seller shall have executed and
delivered to the Buyer a certificate, in form and substance satisfactory to the
Buyer and its counsel, to such effect.
6.03 Performance. The Seller shall have performed and complied with all
covenants and agreements contained herein required to be performed or complied
with by them prior to or at the Closing Date. On the Closing Date, the Seller
shall have executed and delivered to the Buyer a certificate, in form and
substance satisfactory to the Buyer and its counsel, in writing to such effect
and to the further effect that all of the conditions set forth in this Article
VI have been satisfied.
6.04 No Material Adverse Effect. No Material Adverse Effect shall have
occurred since the date hereof.
6.05 Existence/Continuance of Current Accounts. None of the Seller's
accounts relating to the Business shall have notified the Seller of termination
of services with the Seller prior to the Closing. On the Closing Date, the
Seller shall have executed and delivered to the Buyer a certificate, in form and
substance satisfactory to the Buyer and its counsel, to such effect.
6.06 Opinion of Counsel. The Buyer shall have received the opinion of Xxxx
Xxxxx & Xxxxxxx LLP, counsel to the Seller, in substantially the form attached
hereto as Exhibit F.
---------
6.07 Intentionally Left Blank.
6.08 Employment Arrangements. The Buyer shall be satisfied in good faith
that the number and identity of the employees listed on Schedule 2.15 who shall
have accepted the Buyer's offer of post-Closing employment (consistent with
Section 5.02) are sufficient to operate the Business consistent with past
practice.
6.09 Closing Documents. The Seller shall have delivered all of the
resolutions, certificates, documents and instruments required by this Agreement.
6.10 Related Agreements. Each of the Related Agreements shall have been
duly executed and delivered by each of the parties thereto, shall be in full
force and effect as of the Closing Date and enforceable in accordance with the
respective terms thereof.
6.11 Approval of the Buyer and Its Counsel. All actions, proceedings,
consents, instruments and documents required to be delivered by, or at the
behest or direction of, the Seller hereunder or incident to its performance
hereunder, and all other related matters, shall be reasonably satisfactory as to
form and substance to the Buyer and its counsel.
23
ARTICLE VII - CONDITIONS TO THE SELLER'S OBLIGATIONS
----------------------------------------------------
The obligation of the Seller to transfer the Transferred Assets to the
Buyer and to consummate the other transactions contemplated hereby is subject to
the satisfaction, on or before the Closing Date, of the following conditions,
each of which may be waived by the Seller in its sole discretion:
7.01 Corporate Authority. All corporate actions necessary for the approval
of the transactions contemplated hereby by the Buyer shall have been taken by
the Buyer.
7.02 Representations and Warranties to be True and Correct. All of the
representations and warranties of the Buyer contained in this Agreement shall be
true, correct and complete in all material respects on and as of the date hereof
and on and as of the Closing Date as if made on and as of the Closing Date. On
the Closing Date, the Buyer shall have executed and delivered to the Seller a
Certificate in form and substance satisfactory to the Seller and its counsel, to
such effect.
7.03 Performance. The Buyer shall have performed and complied with all
covenants and agreements contained herein required to be performed or complied
with by it prior to or at the Closing Date. On the Closing Date, the Buyer shall
have executed and delivered to the Seller a Certificate in form and substance
satisfactory to the Seller and its counsel, to such effect.
7.04 Closing Documents. The Buyer shall have issued the Common Shares and
all of the resolutions, certificates, documents and instruments required by this
Agreement.
7.05 Opinion of Counsel. The Seller shall have received the opinion of
Mintz, Levin, Cohn, Ferris, Glovsky and Popeo, P.C., counsel to the Buyer, in
substantially the form attached hereto as Exhibit G.
---------
7.06 Related Agreements. Each of the Related Agreements shall have been
duly executed and delivered by each of the parties thereto, shall be in full
force and effect as of the Closing Date and enforceable in accordance with the
respective terms thereof.
ARTICLE VIII - INDEMNIFICATION
------------------------------
8.01 Survival. All representations and warranties made by the Seller or
Buyer contained in this Agreement, shall survive the Closing and shall expire on
the date eighteen months after the Closing Date (the "Survival Date"), except
that (a) claims, if any, asserted in writing prior to the Survival Date
identified as a claim for indemnification pursuant to this Article VIII shall
survive until finally resolved and satisfied in full, and (b) claims, if any,
which are based upon fraud or criminal acts by the Seller, relate to title to
the Transferred Assets or which assert tax liability shall survive for the full
period of the applicable statute of limitations, and until finally resolved and
satisfied in full if asserted on or prior to such date. All covenants and
agreements contained herein shall survive until fully performed in accordance
with their terms.
24
8.02 Indemnification by Seller. The Seller shall indemnify, defend, and
hold harmless the Buyer and its Affiliates (as such term is defined under Rule
405 of the Rules and Regulations of the Securities Act of 1933, as amended) and
the respective officers, directors and employees of the foregoing, and their
successors and assigns from, against and with respect to any claim, liability,
obligation, loss, damage, assessment, judgment, cost and expense (including,
without limitation, reasonable attorneys' and accountants' fees and costs and
expenses reasonably incurred in investigating, preparing, defending against or
prosecuting any litigation or claim, action, suit, proceeding or demand) of any
kind or character (the "Damages"), arising out of or in any manner incident,
relating or attributable to:
(a) Any inaccuracy in any representation or breach of warranty of the
Seller contained in this Agreement (without giving effect to any "Material
Adverse Effect" or other materiality qualifications or any such qualifications
contained or incorporated directly or indirectly in such representation or
warranty, and without giving effect to any update to the Disclosure Schedule
delivered by the Seller to the Buyer after the date of this Agreement and prior
to Closing), any Related Agreement or in any certificate, instrument of transfer
or other document or agreement executed by the Seller in connection with this
Agreement or otherwise made or given in connection with this Agreement;
(b) Any failure by the Seller to perform or observe, or to have performed
or observed, in full, any covenant, agreement or condition to be performed or
observed by them under this Agreement, any Related Agreement or under any
certificates or other documents or agreements executed by the Seller in
connection with this Agreement;
(c) Liabilities or obligations of, or claims against, the Buyer (whether
absolute, accrued, contingent or otherwise) relating to, or arising out of, the
operation of the Business prior to the Closing Date or facts and circumstances
relating to the Business existing at or prior to the Closing Date, whether or
not such liabilities or obligations were known on such date or are set forth in
the Disclosure Schedule, and any other liabilities and obligations of the Seller
relating to the Business or the Transferred Assets not expressly assumed by
Buyer; and
(d) Liabilities or obligations of, or claims against, the Buyer (whether
absolute, accrued, contingent or otherwise) relating to, or arising out of (i)
any failure of any Employee Plan to conform to, or the failure of the operation
and administration of any Employee Plan to be in compliance with, all
requirements of applicable law, including, without limitation, the Employee
Retirement Income Security Act of 1974, as amended ("ERISA") and the Internal
Revenue Code of 1986, as amended (the "Code"), (ii) any actions, suits or claims
pending (other than routine claims for benefits) or threatened against any
Employee Plan or against the assets of any Employee Plan and/or (iii) any
failure by the Seller to comply with (through the Closing Date) all applicable
notice and continuation requirements of the Consolidated Omnibus Budget
Reconciliation Act of 1985, as amended ("COBRA") and the regulations thereunder.
(e) Liabilities or obligations of, or claims against, the Buyer (whether
absolute, accrued, contingent or otherwise) relating to, or arising out of the
Seller's breach of its obligations under any Material Agreements after the
Closing Date.
25
8.03 Indemnification by Buyer. The Buyer shall indemnify, defend, and hold
harmless the Seller and its Affiliates and the respective officers, directors
and employees of the foregoing, and their successors and assigns from, against
and with respect to any Damages arising out of or in any manner incident,
relating or attributable to:
(a) Any inaccuracy in any representation or breach of warranty of the
Buyer contained in this Agreement (without giving effect to any material adverse
effect or other materiality qualifications or any such qualifications contained
or incorporated directly or indirectly in such representation or warranty, and
without giving effect to any update to any disclosure schedules of the Buyer
hereto delivered by the Buyer to the Seller after the date of this Agreement and
prior to Closing);
(b) Any failure by the Buyer to perform or observe, or to have performed
or observed, in full, any covenant, agreement or condition to be performed or
observed by it under this Agreement;
(c) Liabilities or obligations of, or claims against, the Seller (whether
absolute, accrued, contingent or otherwise) relating to, or arising out of, the
operation of the Business after the Closing Date (except to the extent such
Liabilities, obligations or claims are the result of the Seller's acts or
omissions of required actions after the Closing Date); and
(d) Liabilities or obligations of, or claims against, the Seller (whether
absolute, accrued, contingent or otherwise) relating to, or arising out of the
Buyer's breach of its obligations under any Material Agreements after the
Closing Date.
8.04 Claims for Indemnification. In the event of the occurrence of any
event which any party asserts is an indemnifiable event pursuant to this Article
VIII, the party claiming indemnification (the "Indemnified Party") shall provide
prompt notice to the indemnifying party (the "Indemnifying Party"), specifying
in detail the facts and circumstances with respect to such claim and the basis
for which indemnification is available hereunder. If such event involves the
claim of any third party the Indemnifying Party shall have the right to control
the defense or settlement of such claim, provided, however, that (a) the
Indemnified Party shall be entitled to participate in the defense of such claim
at its own expense, (b) the Indemnifying Party shall obtain the prior written
approval of the Indemnified Party (which approval shall not be unreasonably
withheld or delayed) before entering into any settlement of such claim if,
pursuant to or as a result of such settlement, injunctive or other non-monetary
relief would be imposed against the Indemnified Party, (c) the Indemnifying
Party shall not be entitled to control (but shall be entitled to participate at
its own expense in the defense of), and the Indemnified Party shall be entitled
to have sole control over, and shall assume all expense with respect to the
defense or settlement of any claim to the extent such claim seeks an order,
injunction or other equitable relief against the Indemnified Party which, if
successful, could materially interfere with the business, operations, assets,
condition (financial or otherwise) or prospects of the Indemnified Party,
provided that the Indemnified Party shall provide written notice to the
Indemnifying Party of its election to assume control over the defense of such
claim pursuant to this Section 8.03(c), and (d) if the Indemnifying Party is
entitled but fails to assume control over the defense of a claim as provided in
this Section 8.03, provided that the Damages associated with such claim are
covered by the indemnity
26
provisions of Section 8.02, the Indemnified Party shall have the right to
defend such claim, provided further that the Indemnified Party shall obtain the
prior written approval of the Indemnifying Party (which approval shall not be
unreasonably withheld or delayed) before entering into any settlement of such
claim if, pursuant to or as a result of such settlement, injunctive or other
non-monetary relief would be imposed against the Indemnifying Party.
In the event that the Indemnifying Party shall be obligated to indemnify
the Indemnified Party pursuant to this Article VIII, the Indemnifying Party
shall, upon payment of such indemnity in full, be subrogated to all rights of
the Indemnified Party with respect to the claim to which such indemnification
relates.
8.05 Limitations on Indemnification.
(a) The Seller shall not be liable under Section 8.02 above, and the Buyer
shall not be liable under Section 8.03 above, unless the aggregate amount of
Damages suffered by the Indemnified Parties under Section 8.02 or the aggregate
amount of Damages suffered by the Indemnified Parties under 8.03, respectively,
exceeds $50,000 (at which point the Indemnifying Party will be obligated to
indemnify the Indemnified Party from and against Damages in respect of such
claim only to the extent that the aggregate of all such claims exceeds $50,000).
(b) In the event that the Seller shall be obligated to indemnify the Buyer
pursuant to this Article VIII, the Seller shall be entitled, but not required,
to satisfy such indemnification obligation, in whole or in part, by returning to
the Buyer that number of Common Shares as is equal in value to the aggregate
amount of Damages in respect of which the Seller chooses to satisfy with. For
the purpose of calculating the value of the Common Shares to be returned to the
Buyer pursuant to this Section 8.05(b), the value of each Common Share so
returned shall be deemed to be $4.9709. To the extent the Seller does not so
satisfy any indemnification obligations by returning Common Shares, the Seller
shall satisfy such indemnification obligations with cash.
(c) In no event shall the Seller or the Buyer be entitled to recover
consequential damages. Except with respect to claims, if any, which are based
upon fraud or criminal acts by the Seller, relate to title to the Transferred
Assets or which assert tax liability, in no event shall the Seller or the Buyer
be liable for indemnification pursuant to this Article VIII for Damages in
excess of $2,100,000.
(d) Notwithstanding the foregoing, the limitations set forth in Section
8.05(a), (b) and (c) shall not apply to Damages to the Buyer, or Liabilities or
obligations of, or claims against, the Buyer (whether absolute, accrued,
contingent or otherwise) relating to, or arising out of, (i) the Seller's breach
of its agreement in Section 2.22 to satisfy in full its liabilities and
obligations under Material Agreements when such liabilities and obligations are
due and (ii) the Seller's breach of its agreement in Section 4.11 to pay and
satisfy and full (when due) all of its liquidated obligations and liabilities
associated with the Business or the Transferred Assets.
27
ARTICLE IX - TERMINATION
------------------------
9.01 Termination. This Agreement may be terminated and the transactions
contemplated hereby may be abandoned at any time prior to the Closing:
(a) By mutual written consent duly authorized by the Buyer and the Seller;
(b) By the Buyer or the Seller if:
(i) Any court of competent jurisdiction or other governmental body
shall have issued an order, decree or ruling, or taken any other action
restraining, enjoining or otherwise prohibiting the transactions
contemplated hereby, provided that this Agreement shall not be terminated
pursuant to this paragraph unless the party terminating this Agreement has
utilized its reasonable best efforts to oppose the issuance of such order,
decree or ruling or the taking of such action; or
(ii) The Closing has not occurred on or prior to January 30, 2002 for
any reason other than the breach of any provision of this Agreement by the
party terminating this Agreement; or
(c) By the Buyer if:
(i) Any of the conditions set forth in Article VI hereof has become
incapable of fulfillment for any reason other than a breach by the Buyer
hereunder and shall not have been waived by the Buyer; or
(ii) If in the Buyer's good faith judgment there is any inaccuracy in
any representation or breach of any warranty of the Seller contained
herein, or any failure by the Seller to perform any commitment, covenant or
condition contained in this Agreement, or there exists any error,
misstatement or omission with regard to any of the Exhibits, the Disclosure
Schedule or other documents referred to herein; or
(d) By the Seller if:
(i) Any of the conditions set forth in Article VII hereof has become
incapable of fulfillment for any reason other than a breach by the Seller
hereunder and shall not have been waived by the Seller; or
(ii) The Closing has not occurred on or prior to January 30, 2002 for
any reason other than the breach of any provision of this Agreement by the
party terminating this Agreement.
Upon the occurrence of any of the events specified in this Section 9.01
(other than Subsection (a) hereof), written notice of such event shall forthwith
be given to the other party to this Agreement, whereupon this Agreement shall
terminate.
28
9.02 Effect of Termination. In the event of the termination and
abandonment of this Agreement pursuant to Section 9.01, all obligations of the
parties hereunder shall cease, provided, however, that (i) the provisions of
Articles IX and X shall survive such termination and (ii) nothing herein shall
limit the remedies of any party with respect to any breach of this Agreement by
any other party.
ARTICLE X - MISCELLANEOUS
-------------------------
10.01 Notices. All notices, requests, consents and other communications
hereunder shall be in writing, shall be addressed to the receiving party's
address set forth below or to such other address as a party may designate by
notice hereunder, and shall be either (i) delivered by hand, (ii) made by telex,
telecopy or facsimile transmission, (iii) sent by recognized overnight courier,
or (iv) sent by registered or certified mail, return receipt requested, postage
prepaid.
If to the Seller: PE Corporation (NY)
Celera Genomics Group
00 Xxxx Xxxx Xxxxx
Xxxxxxxxx, XX 00000
Attention: President
cc: Legal Department
Fax: (000) 000-0000
PE Corporation (NY)
000 Xxxxxxx
Xxxxxxx, XX 00000
Attention: Corporate Secretary
Fax: (000) 000-0000
with a copy to: Xxxx Xxxxx & Xxxxxxx LLP
Xxx Xxxxxxxx Xxxxxx
Xxxxxxxx, XX 00000
Attn: Xxxxxxx X. Xxxxxxx
Fax No.: (000) 000-0000
If to the Buyer, to: Paradigm Genetics, Inc.
000 Xxxxxxxxx Xxxxx
X.X. Xxx 00000
Research Triangle Park., NC 27709-4528
Fax. No.: (000) 000-0000
Attn: Chief Executive Officer
with a copy to: Mintz, Levin, Cohn, Ferris, Glovsky and Popeo, P.C.
Xxx Xxxxxxxxx Xxxxxx
Xxxxxx, XX 00000
Attn: Xxxxxxx X. Xxxxxx
Fax No.: (000) 000-0000
29
All notices, requests, consents and other communications hereunder shall be
deemed to have been received (i) if by hand, at the time of the delivery thereof
to the receiving party at the address of such party set forth above, (ii) if
made by telex, telecopy or facsimile transmission, at the time that receipt
thereof has been acknowledged by electronic confirmation or otherwise, (iii) if
sent by overnight courier, on the next business day following the day such
notice is delivered to the courier service, or (iv) if sent by registered or
certified mail, on the fifth (5th) business day following the day such mailing
is made.
10.02 Entire Agreement. This Agreement together with the Exhibits and
Schedules hereto, the Related Agreements and the other documents executed in
connection herewith (together, the "Documents") embodies the entire agreement
and understanding between the parties hereto with respect to the subject matter
hereof and supersedes all prior oral or written agreements and understandings
relating to the subject matter hereof. No statement, representation, warranty,
covenant or agreement of any kind not expressly set forth in the Documents shall
affect, or be used to interpret, change or restrict, the express terms and
provisions of this Agreement.
10.03 Modifications and Amendments. The terms and provisions of this
Agreement may be modified or amended only by written agreement executed by all
parties hereto.
10.04 Waivers and Consents. No failure or delay by a party hereto in
exercising any right, power or remedy under this Agreement, and no course of
dealing between the parties hereto, shall operate as a waiver of any such right,
power or remedy of the party. No single or partial exercise of any right, power
or remedy under this Agreement by a party hereto, nor any abandonment or
discontinuance of steps to enforce any such right, power or remedy, shall
preclude such party from any other or further exercise thereof or the exercise
of any other right, power or remedy hereunder. The election of any remedy by a
party hereto shall not constitute a waiver of the right of such party to pursue
other available remedies. No notice to or demand on a party not expressly
required under this Agreement shall entitle the party receiving such notice or
demand to any other or further notice or demand in similar or other
circumstances or constitute a waiver of the rights of the party giving such
notice or demand to any other or further action in any circumstances without
such notice or demand. The terms and provisions of this Agreement may be waived,
or consent for the departure therefrom granted, only by written document
executed by the party entitled to the benefits of such terms or provisions. No
such waiver or consent shall be deemed to be or shall constitute a waiver or
consent with respect to any other terms or provisions of this Agreement, whether
or not similar. Each such waiver or consent shall be effective only in the
specific instance and for the purpose for which it was given, and shall not
constitute a continuing waiver or consent.
10.05 Assignment. Neither this Agreement, nor any right hereunder, may be
assigned by any of the parties hereto without the prior written consent of the
other parties, except that the Buyer may assign all or part of its rights and
obligations under this Agreement to one or more direct or indirect subsidiaries
or Affiliates of the Buyer.
10.06 Parties in Interest. This Agreement shall be binding upon and inure
solely to the benefit of each party hereto and their permitted assigns, and
nothing in this Agreement, express or
30
implied, is intended to confer upon any other person any rights or remedies of
any nature whatsoever under or by reason of this Agreement. Nothing in this
Agreement shall be construed to create any rights or obligations except among
the parties hereto, and no person or entity shall be regarded as a third-party
beneficiary of this Agreement.
10.07 Governing Law. This Agreement and the rights and obligations of the
parties hereunder shall be construed in accordance with and governed by the laws
of the State of Delaware without giving effect to the conflict of law principles
thereof.
10.08 Jurisdiction and Service of Process. Any legal action or proceeding
with respect to this Agreement may be brought in the courts of The Commonwealth
of Massachusetts, the State of New York or of the United States of America
located in The Commonwealth of Massachusetts or the State of New York. By
execution and delivery of this Agreement, each of the parties hereto accepts for
itself and in respect of its property, generally and unconditionally, the
jurisdiction of the aforesaid courts. The parties hereby irrevocably waive any
objection or defense that they may now or hereafter have to the assertion of
personal jurisdiction by any such court in any such action or to the laying of
the venue of any such action in any such court, and hereby waive, to the extent
not prohibited by law, and agree not to assert, by way of motion, as a defense,
or otherwise, in any such proceeding, any claim that it is not subject to the
jurisdiction of the above-named courts for such proceedings. Each of the parties
hereto irrevocably consents to the service of process of any of the
aforementioned courts in any such action or proceeding by the mailing of copies
thereof by registered mail, postage prepaid, to the party at its address set
forth in Section 10.01 hereof and irrevocably waive any objection or defense
that it may now or hereafter have to the sufficiency of any such service of
process in any such action. Nothing in this Section 10.08 shall affect the
rights of the parties to commence any such action in any other forum or to serve
process in any such action in any other manner permitted by law.
10.09 Severability. In the event that any court of competent jurisdiction
shall finally determine that any provision, or any portion thereof, contained in
this Agreement shall be void or unenforceable in any respect, then such
provision shall be deemed limited to the extent that such court determines it
enforceable, and as so limited shall remain in full force and effect. In the
event that such court shall determine any such provision, or portion thereof,
wholly unenforceable, the remaining provisions of this Agreement shall
nevertheless remain in full force and effect.
10.10 Interpretation. The parties hereto acknowledge and agree that (i)
each party and its counsel reviewed and negotiated the terms and provisions of
this Agreement (except with respect to the Disclosure Schedule which is the sole
responsibility of the Seller and have contributed to its revision, (ii) the rule
of construction to the effect that any ambiguities are resolved against the
drafting party shall not be employed in the interpretation of this Agreement and
(iii) the terms and provisions of this Agreement shall be construed fairly as to
all parties hereto and not in favor of or against any party, regardless of which
party was generally responsible for the preparation of this Agreement.
References herein to the "knowledge" of the Seller refer to the actual knowledge
of its officers, Xxxxxxx Xxxxxx and Xxx XxXxxxx, as well as the knowledge that
such persons would have after reasonable due inquiry of the relevant matters
(regardless of whether such reasonable inquiry was actually performed).
References herein to the "knowledge" of the Buyer refer to the actual knowledge
of its officers, as well as the
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knowledge that such persons would have after reasonable due inquiry of the
relevant matters (regardless of whether such reasonable inquiry was actually
performed).
10.11 Headings and Captions. The headings and captions of the various
subdivisions of this Agreement are for convenience of reference only and shall
in no way modify, or affect, or be considered in construing or interpreting the
meaning or construction of any of the terms or provisions hereof.
10.12 Enforcement. Each of the parties hereto acknowledges and agrees that
the rights acquired by each party hereunder are unique and that irreparable
damage would occur in the event that any of the provisions of this Agreement to
be performed by the other party were not performed in accordance with their
specific terms or were otherwise breached. Accordingly, in addition to any other
remedy to which the parties hereto are entitled at law or in equity, each party
hereto shall be entitled to an injunction or injunctions to prevent breaches of
this Agreement by the other party and to enforce specifically the terms and
provisions hereof in any federal or state court to which the parties have agreed
hereunder to submit to jurisdiction.
10.13 Reliance. The parties hereto agree that, notwithstanding any right of
any party to this Agreement to investigate the affairs of any other party to
this Agreement, the party having such right to investigate shall have the right
to rely fully upon the representations and warranties of the other party
expressly contained in this Agreement and on the accuracy of any schedule or
other document attached hereto or referred to herein or delivered by such other
party or pursuant to this Agreement.
10.14 Expenses. Each of the parties hereto shall pay its own fees and
expenses (including the fees of any attorneys, accountants, appraisers or others
engaged by such party) in connection with this Agreement, the Related Agreements
and the transactions contemplated hereby whether or not the transactions
contemplated hereby are consummated.
10.15 Publicity. No party shall issue any press release or otherwise make
any public statement with respect to the execution of, or the transactions
contemplated by, this Agreement without the prior written consent of the other
party, except as may be required by law.
10.16 Confidentiality. Each party acknowledges and agrees that any
information or data it has acquired from the other party, not otherwise properly
in the public domain, was received in confidence. Each party hereto agrees not
to divulge, communicate or disclose, except as may be required by law or for the
performance of this Agreement, or use to the detriment of the disclosing party
or for the benefit of any other person or persons, or misuse in any way, any
confidential information of the disclosing party concerning the subject matter
hereof, including any trade or business secrets of the disclosing party and any
technical or business materials that are treated by the disclosing party as
confidential or proprietary, including without limitation information (whether
in written, oral or machine-readable form) concerning: general business
operations; methods of doing business, servicing clients, client relations, and
of pricing and making charge for services and products; financial information,
including costs, profits and sales; marketing strategies; business forms
developed by or for the disclosing party; names of suppliers, personnel,
customers, clients and potential clients; negotiations or other business
contacts with suppliers, personnel, customers, clients and potential clients;
form and content of bids, proposals and contracts; the disclosing party's
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internal reporting methods; technical and business data, documentation and
drawings; software programs, however embodied; manufacturing processes;
inventions; diagnostic techniques; and information obtained by or given to the
disclosing party about or belonging to third parties.
10.17 Trade Shows. The Seller and the Buyer agree and understand that,
whether or not the transactions contemplated by this Agreement have been
consummated (until such time as this Agreement is terminated pursuant to Article
IX), the Buyer will be representing the Business at trade shows on December 4-5,
2001 and February 4-5, 2002 (the "Trade Shows"), will be advertising its
acquisition of the Business at the Trade Shows, and will be conducting itself at
the Trade Shows as though the transactions contemplated by this Agreement have
been consummated, and will perform marketing activities with respect to the
Business before and after the Trade Shows. Notwithstanding the foregoing, the
Buyer shall not be authorized to create contractual obligations on behalf of the
Seller without the Seller's consent, though the Buyer may enter into contractual
obligations on behalf of the Seller with the prior consent of the Seller. In the
event that this Agreement is terminated pursuant to the terms of this Agreement,
the Seller agrees that it will not xxx the Buyer or otherwise hold responsible
the Buyer for (i) its conduct at the Trade Shows (as long as such conduct is not
unlawful and does not involve willful misconduct), (ii) its related marketing
activities (as long as such activities are not unlawful and do not involve
willful misconduct), or (iii) creating contractual obligations on behalf of the
Seller with the Seller's consent; provided however, that the Seller may hold the
Buyer responsible if the Buyer enters into contractual obligations on behalf of
the Seller without the Seller's consent.
10.18 Counterparts. This Agreement may be executed in one or more
counterparts, and by different parties hereto on separate counterparts, each of
which shall be deemed an original, but all of which together shall constitute
one and the same instrument.
[The remainder of this page has been intentionally left blank]
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IN WITNESS WHEREOF, the parties hereto have executed this Agreement as an
instrument under seal of the date first above written.
BUYER
PARADIGM GENETICS, INC.
By: /s/ Xxxx X. Xxxxx
--------------------------
Name: Xxxx X. Xxxxx
Title: Chief Executive Officer
SELLER
PE CORPORATION (NY)
By: /s/ Xxxxx Xxxxxxx
--------------------------
Name: Xxxxx Xxxxxxx
Title: Executive Vice President and
Chief Business Officer
TRA 1647936v1
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