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EXHIBIT 2.1
ASSET PURCHASE AGREEMENT
This Asset Purchase Agreement (this "Agreement") is made as of May
22, 1998, by and between Business Resource Group, a California corporation with
its principal place of business at 0000 Xxxxx Xxxxx Xxxxxx, Xxxxx 000, Xxx Xxxx,
Xxxxxxxxxx 00000 ("BRG"), OFN, INC., d.b.a. Office Furniture Networking, a
California corporation with its principal place of business at 0000 Xxxxxx
Xxxxx, Xxx Xxxxx, Xxxxxxxxxx 00000 ("OFN"), BRG Acquisition Corp., a California
corporation and wholly-owned subsidiary of BRG with its principal place of
business at 0000 Xxxxx Xxxxx Xxxxxx, Xxxxx 000, Xxx Xxxx, Xxxxxxxxxx 00000 ("BRG
Acquisition Corp."), and Xxxxx & Xxxxxxx Xxxxxxxx, Husband and Wife as Joint
Tenants (the "Shareholder").
RECITALS
On the terms and conditions set forth below, BRG desires to purchase
the assets of OFN identified on Exhibit A to this Agreement (the "Purchased
Assets") and assume certain scheduled liabilities of OFN. BRG currently intends
to deploy the Purchased Assets through BRG Acquisition Corp.
In consideration of the mutual agreements, representations and
warranties contained in this Agreement, the parties agree as follows:
1. PURCHASE AND SALE.
(a) PURCHASED ASSETS. Subject to the terms and conditions
contained in this Agreement, at the Closing (as defined below), OFN shall sell,
assign, transfer and convey to BRG Acquisition Corp., free and clear of all
liens and encumbrances, and BRG Acquisition Corp. shall purchase from OFN, the
Purchased Assets identified on Exhibit A. OFN and the Shareholder agree to take
all steps reasonably requested by BRG to transfer title to the Purchased Assets
to BRG Acquisition Corp. at or as soon as possible after the Closing.
(b) ASSUMED LIABILITIES. Neither BRG nor BRG Acquisition
Corp. assumes hereby or in connection with this Agreement any liabilities of OFN
whatsoever, except for the obligations under those contracts and other
arrangements specifically described on Exhibit B which arise after the Closing
(as defined below). The foregoing contracts and other arrangements listed on
Exhibit B are sometimes referred to in this Agreement as the "Assumed Contracts"
or the "Assumed Liabilities." All of the obligations retained by OFN shall be
referred to in this Agreement as the "Non-Assumed Liabilities" and shall include
all debts, liabilities, payables and expenses not specifically included within
the Assumed Liabilities, including, but not limited to, those obligations under
the Assumed Contracts which arise or become due prior to the Closing (as defined
below) and any and all matters set forth on the OFN Schedule of Exceptions (as
defined below).
2. PURCHASE PRICE; TERMS OF PAYMENT.
(a) CLOSING. The consummation of the purchase and sale of
the Purchased Assets shall take place at a closing (the "Closing") to be held at
BRG's San Xxxx offices on May
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22, 1998 concurrently with the execution and delivery of this Agreement. The
time and date of the Closing are referred to in this Agreement as the "Closing
Date."
(b) PURCHASE PRICE. The purchase price to be paid for the
Purchased Assets (the "Purchase Price") shall consist of the following:
(i) BRG shall issue to OFN an aggregate of
100,000 shares of the Common Stock of BRG (the "Shares"), which shares shall not
be registered under the Securities Act of 1933, as amended;
(ii) BRG shall deliver to OFN $2,000,000 in
immediately available funds (the "Cash Payment");
(iii) BRG shall deliver to OFN a promissory
note issued by BRG in the amount of $1,069,204.78 pursuant to the terms and
conditions of and substantially in the form attached hereto as Exhibit C (the
"Note");
(iv) BRG shall deliver to the Shareholder
$93,000 in immediately available funds, which amount represents 17.77% of the
projected net write-up of the Purchased Assets (other than goodwill) and is
intended to compensate the Shareholder for the anticipated incremental income
taxes to be incurred upon the transfer of the Purchased Assets in comparison to
the income taxes that would have been due on a sale of stock of OFN (the "Tax
Payment"). The parties acknowledge and agree that no further tax payments shall
be due from either party to the other regardless of the actual taxes that may be
due.
(v) BRG shall grant stock options, the
aggregate fair market value of which shall be $75,000 as of the Closing Date, to
the key non-owner employees of OFN set forth on Exhibit D hereto (the
"Optionees"), which Optionees shall be recommended by Xxxxx Xxxxxxxx and Xxxxxxx
Xxxxxxxx and subject to the approval of the Company, which approval shall not be
unreasonably withheld (the "Options").
(c) DELIVERY. At the Closing, OFN shall deliver to BRG
Acquisition Corp. an executed Xxxx of Sale in the form attached hereto as
Exhibit E and any other appropriate instruments of transfer of title to the
Purchased Assets evidencing the purchase and sale of the Purchased Assets, as
well as all title documents relating to the Purchased Assets, duly executed or
endorsed for transfer to BRG Acquisition Corp. At the Closing, BRG shall deliver
to OFN the Cash Payment, the Note, the Tax Payment and the Options and shall
issue instructions to the transfer agent for its stock to issue a certificate
representing the Shares to OFN.
(d) ALLOCATION OF PURCHASE PRICE. The Purchase Price shall
be allocated as provided in Exhibit F hereto (the "Allocation") for purposes of
complying with the requirements of Section 1060 of the Internal Revenue Code of
1986, as amended. Each party hereto agrees to prepare its federal and state
income tax returns for all current and future tax reporting periods and file
Form 8594 (and corresponding state forms) with respect to this transaction in a
manner consistent with the Allocation. If any state or federal taxing authority
challenges such allocation, the party receiving notice of such challenge shall
give the other prompt written notice of such
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challenge, and the parties shall cooperate in good faith in responding to it in
order to preserve the effectiveness of such Allocation.
(e) TAXES. OFN shall pay all sales, use, transfer, excise
or other similar taxes, if any, arising out of the transfer of the Purchased
Assets or otherwise as a consequence of the transactions contemplated by this
Agreement (other than sales taxes arising from the sale of the Purchased Assets
pursuant to this Agreement).
3. REPRESENTATIONS AND WARRANTIES OF OFN AND THE SHAREHOLDER. Subject
to and except for information contained in a schedule of exceptions delivered to
BRG and BRG Acquisition Corp. prior to the signing of this Agreement and
attached hereto as Exhibit G (the "OFN Disclosure Schedule"), OFN and the
Shareholder jointly and severally represent and warrant to BRG and BRG
Acquisition Corp. as follows:
(a) ORGANIZATION. OFN is a corporation duly incorporated,
validly existing and in good standing under the laws of California, has the
corporate power and authority to own or lease its properties and to carry on its
business as now being conducted, and possesses all licenses, franchises, rights
and privileges necessary to the conduct of its business. OFN is not qualified or
licensed to do business as a foreign company in any other jurisdiction, and
neither the character of the properties owned or leased by OFN nor the nature of
the business transacted by OFN requires OFN to be qualified in any other
jurisdiction, except where failure to so qualify would not have a material
adverse effect on OFN 's business.
(b) FINANCIAL STATEMENTS. OFN has furnished to BRG the
unaudited OFN balance sheets as at March 31, 1998 and the related unaudited
statements of operations for the period then ended (the " OFN Financial
Statements"). All such OFN Financial Statements, together with any notes
thereto, (i) are in accordance with OFN's books and records, (ii) present fairly
the financial position of OFN as of such date and (iii) have been prepared in
conformity with generally accepted accounting principles applied on a consistent
basis (subject to normal year-end adjustments as required by OFN's independent
accounting firm and except that such statements do not contain footnotes).
(c) AUTHORIZATION. OFN has, or will have at the Closing
Date, the corporate power to enter into this Agreement and the execution,
delivery and performance of this Agreement has been, or will be at the Closing
Date, duly authorized by all requisite corporate action; and this Agreement has
been, or will be at the Closing Date, duly executed and delivered and
constitutes the valid and binding obligation of OFN.
(d) EFFECT OF AGREEMENT. The execution, delivery and
performance by OFN of this Agreement and the consummation of the transactions
herein contemplated, will not conflict with, or result in a breach of the terms
of, or constitute a default under or violation of, any law or regulation of any
governmental authority, domestic or foreign applicable to OFN, or the Articles
of Incorporation or Bylaws of OFN or any material agreement or instrument to
which OFN is a party or by which it is bound or to which it is subject, other
than any conflicts, breaches, defaults or violations which individually or in
the aggregate would not have a material adverse effect on OFN; nor will it give
to others any interests or rights, including rights of
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termination, acceleration or cancellation in or with respect to any of the
properties, assets, agreements, contracts or business of OFN. No consent of any
person not a party to this Agreement and no consent of any governmental
authorities are required to be obtained on the part of OFN to permit the
continuation by BRG Acquisition Corp. after the Closing Date of the business
activities of OFN in the manner such business is now carried on by OFN.
(e) INVENTORIES. The inventories of OFN, whether finished
goods, work in process or raw materials, are all items of a quality usable or
salable in the ordinary and usual course of OFN's business, except for inventory
items which are obsolete or not usable or salable in the ordinary course of
business which have been written down to an amount not in excess of realizable
market value or for which adequate reserves or allowances have been provided.
The values at which inventories are carried reflect the inventory valuation
policy of OFN, which is in accordance with generally accepted accounting
principles applied on a consistent basis.
(f) ACCOUNTS RECEIVABLE. Exhibit A includes a complete list
of the accounts and notes receivable of OFN as of the date shown, aged by
customer or debtor, as the case may be. The accounts and notes receivable of OFN
as of the date shown or thereafter acquired arose from valid transactions and
are collectible (net of the allowance for doubtful accounts) in the ordinary and
usual course of business and are not subject to any assertable defense or
set-off. The reserve for doubtful accounts is adequate and the values at which
accounts and notes receivable are carried reflect the policies of OFN consistent
with OFN's past practice and are in accordance with generally accepted
accounting principles applied on a consistent basis.
(g) INSURANCE. The OFN Disclosure Schedule contains a true
and complete list and description of all policies of insurance maintained by
OFN. Such insurance or comparable insurance will be maintained in full force and
effect to and including the Closing Date.
(h) ABSENCE OF CERTAIN CHANGES. Since March 31, 1998, OFN
has not (i) issued or delivered to any person any shares of stock, bonds or
other corporate securities, (ii) incurred any obligation or liability (absolute
or contingent) in excess of $10,000 individually or in the aggregate, (iii)
discharged or satisfied any lien or encumbrance, or paid any obligation or
liability (absolute or contingent), other than current liabilities reflected on
the OFN Financial Statements and current liabilities incurred since the date of
the OFN Financial Statements in the ordinary course of business, (iv) declared
or made any payment or distribution to shareholders (other than the payment of
employment-related compensation consistent with past practice to shareholders
who are OFN employees), or purchased or redeemed any shares of stock, (v)
increased the wage or salary of any employee, (vi) mortgaged, pledged or
subjected to lien or any other encumbrance any assets (tangible or intangible,
other than assets which are subject to purchase money security interests and
which were acquired in the ordinary course of business) and do not exceed
$10,000 individually or in the aggregate, (vii) sold or transferred any tangible
assets or canceled any debts or claims, except in the ordinary course of
business or in an aggregate amount which does not exceed $10,000, (viii) sold,
assigned, licensed or transferred any patents, trademarks, trade names,
copyrights, licenses, computer software programs or other intangible assets
other than in the ordinary course of business, (ix) suffered any extraordinary
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loss or waived any right of substantial value, (x) entered into any transactions
other than in the ordinary course of business, or (xi) agreed to any of the
foregoing. Since March 31, 1998, there has been no material adverse change in
the business, financial condition, results of operations or prospects of OFN.
(i) COMPLIANCE WITH LAWS. Except as set forth in the OFN
Disclosure Schedule, OFN has complied with, and is not in violation of any
statute, law, rule or regulation with respect to the conduct of its business,
the ownership or operation of its properties, or the sale or purchase of its
securities or disclosure to shareholders which violation might have a material
adverse effect on the business, financial condition or prospects of OFN.
(j) BROKERS OR FINDERS. Except as set forth on the OFN
Disclosure Schedule, OFN is not obligated, directly or indirectly, to any person
for brokerage or finders' fees or agents' commissions or any similar charges in
connection with this Agreement or any transaction contemplated hereby.
(k) TITLE TO PURCHASED ASSETS. OFN has and will convey on
the Closing Date full, absolute, good and marketable title to the Purchased
Assets, free and clear of all security interests, mortgages, liens (including,
but not limited to, liens with respect to taxes), attachments, orders of court,
rights of redemption, debts, claims, charges or other encumbrances of any kind
whatsoever and not subject to any continuing commission, profit or revenue
sharing or other compensation contract or obligation that could apply to BRG,
BRG Acquisition Corp. or the Purchased Assets.
(l) LITIGATION, ETC. There are no suits, actions or
administrative, arbitration, unfair labor practice, worker's compensation or
other proceedings or governmental investigations, pending or threatened against
or relating, directly or indirectly, to the Purchased Assets or OFN's business,
and there are no judgments, orders, injunctions, decrees, stipulations or awards
(whether rendered by a court, administrative agency or by arbitration, pursuant
to a grievance or other procedure) against or relating to OFN or the Purchased
Assets which could result in a material adverse effect, or any lien or other
encumbrance, on the Purchased Assets.
(m) ASSIGNABILITY OF CONTRACTS; NO DEFAULT. All assignments
or other transfers of the Assumed Contracts have been obtained for transfer to
BRG Acquisition Corp. in accordance with the terms of this Agreement, without
default, penalty or other similar restriction. No default or condition
permitting declaration of default exists with respect to the Assumed Contracts.
OFN is not aware of any payments (other than those required in connection with
the Assumed Liabilities) that will be required in the future to be made under
the Assumed Contracts.
(n) TAXES. All sales and use taxes, real and personal
property taxes, gross receipts taxes, documentary transfer taxes, employment
taxes, withholding taxes, unemployment insurance contributions and other taxes
or governmental charges of any kind, however denominated, for which BRG or BRG
Acquisition Corp. could become liable with respect to the Purchased Assets or
which could result in a lien on or charge against the Purchased Assets (other
than sales taxes arising from the sale of the Purchased Assets pursuant to this
Agreement) (collectively, "Taxes") have been or will be paid with respect to all
periods prior to and including
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the Closing Date. OFN and any other person required to file returns or reports
of Taxes relating to OFN or the Purchased Assets has duly and timely filed all
returns and reports of Taxes required to be filed, and all such returns and
reports are true, correct and complete. There are not any liens for Taxes on any
of the Purchased Assets (other than liens for Taxes not yet due and payable).
OFN has complied with all record keeping and tax reporting obligations relating
to income and employment taxes due with respect to compensation paid to
employees. OFN is not a "foreign person" within the meaning of Section
1445(f)(3) of the Internal Revenue Code of 1986, as amended (the "Code"). There
are no pending or threatened proceedings with respect to Taxes. No agreement or
arrangement regarding compensation which will be assumed by BRG or BRG
Acquisition Corp. provides for any payments which could result in a
nondeductible expense to BRG or BRG Acquisition Corp. pursuant to Section 280G
of the Code or an excise tax to the recipient of such payment pursuant to
Section 4999 of the Code.
(o) MATERIAL MISREPRESENTATIONS AND OMISSIONS. No
representation or warranty by OFN or the Shareholder in this Agreement, or in
any certificate furnished or to be furnished by OFN or the Shareholder pursuant
hereto or in connection with the transactions contemplated hereby, contains or
will contain any untrue statement of a material fact or omits or will omit to
state a material fact necessary to make the statements therein, in light of the
circumstances under which they were made, not misleading.
(p) SOLE SHAREHOLDER. The Shareholder is the sole
shareholder of OFN and no other person has any right, warrant or option to
acquire any shares of capital stock of OFN.
(q) OFN EMPLOYEES. All employees of OFN and each such
employee's respective compensation arrangement are set forth on Exhibit H
hereto.
4. REPRESENTATIONS AND WARRANTIES OF OFN REGARDING THE SHARES.
(a) OFN represents and warrants to BRG as follows with
respect to the Shares:
(i) OFN is aware of BRG's business affairs and
financial condition and has acquired sufficient information about BRG to reach
an informed and knowledgeable decision to acquire the Shares. OFN is acquiring
the Shares for investment for OFN's own account only and not with a view to, or
for resale in connection with, any "distribution" thereof within the meaning of
the Securities Act of 1933, as amended (the "Securities Act").
(ii) OFN understands that the Shares constitute
"restricted securities" and have not been registered under the Securities Act by
reason of a specific exemption therefrom, which exemption depends upon, among
other things, the bona fide nature of OFN's investment intent as expressed
herein. OFN further acknowledges and understands that BRG is under no obligation
to register the Shares. OFN understands that the certificate evidencing the
Shares will be imprinted with a legend which prohibits the transfer of the
Shares unless they are registered or such registration is not required in the
opinion of counsel for BRG.
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(iii) OFN is aware of the provisions of Rule
144 promulgated under the Securities Act, which in substance, permit limited
public resale of "restricted securities" acquired, directly or indirectly from
the issuer thereof (or from an affiliate of such issuer), in a non-public
offering subject to the satisfaction of certain of the conditions specified by
Rule 144, including, among other things: (1) the resale occurring not less than
one year after the party has purchased, and made full payment for, within the
meaning of Rule 144, the securities to be sold; and, in the case of an affiliate
of BRG, or of a non-affiliate who has held the securities less than two years,
(2) the availability of certain public information about BRG, (3) the sale being
made through a broker in an unsolicited "broker's transaction" or in
transactions directly with a market maker (as such term is defined under the
Securities Exchange Act of 1934, as amended), and (4) the amount of securities
being sold during any three-month period not exceeding the specified limitations
stated therein, if applicable.
(iv) OFN further understands that at the time
OFN wishes to sell the securities there may be no public market upon which to
make such a sale, and that, even if such a public market then exists, BRG may
not be satisfying the current public information requirements of Rule 144, and
that, in such event, OFN would be precluded from selling the securities under
Rule 144 even if the applicable holding period had been satisfied.
(v) OFN further understands that in the event
all of the applicable requirements of Rule 144 are not satisfied, registration
under the Securities Act, compliance with Regulation A or some other
registration exemption will be required; and that, notwithstanding the fact that
Rule 144 is not exclusive, the staff of the Securities and Exchange Commission
has expressed its opinion that persons proposing to sell private placement
securities other than in a registered offering and otherwise than pursuant to
Rule 144 will have a substantial burden of proof establishing that an exemption
from registration is available for such offers or sales and that such persons
and their respective brokers who participate in such transactions do so at their
own risk.
(b) OFN acknowledges and understands that the certificate
or certificates representing the Shares shall bear the following legends (as
well as any legends required by applicable state and federal corporate and
securities laws):
(i) "THE SHARES REPRESENTED BY THIS CERTIFICATE
HAVE BEEN ACQUIRED FOR INVESTMENT AND NOT WITH A VIEW TO, OR IN CONNECTION WITH,
THE SALE OR DISTRIBUTION THEREOF. NO SUCH SALE OR DISPOSITION MAY BE EFFECTED
WITHOUT AN EFFECTIVE REGISTRATION STATEMENT RELATED THERETO OR AN OPINION OF
COUNSEL FOR THE COMPANY THAT SUCH REGISTRATION IS NOT REQUIRED UNDER THE
SECURITIES ACT OF 1933."
(ii) Any legend required to be placed thereon
by the California Commissioner of Corporations.
5. REPRESENTATIONS AND WARRANTIES OF BRG AND BRG ACQUISITION CORP.
Subject to and except for the information contained in a schedule of exceptions
delivered to OFN
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prior to the signing of this Agreement and attached hereto as Exhibit I (the
"BRG Disclosure Schedule"), BRG and BRG Acquisition Corp. jointly and severally
represent and warrant to OFN as follows:
(a) ORGANIZATION. BRG is a corporation duly incorporated,
validly existing and in good standing under the laws of the State of California
and has all necessary corporate power and authority to own or lease its
properties and to carry on its business as now being conducted, and possesses
all licenses, franchises, rights and privileges material to the conduct of its
business. BRG Acquisition Corp. is a wholly-owned subsidiary of BRG and a
corporation duly incorporated, validly existing and in good standing under the
laws of the State of California having all necessary corporate power and
authority to own or lease its properties and to carry on its business as now
being conducted, and possesses all licenses, franchises, rights and privileges
material to the conduct of its business.
(b) AUTHORIZATION. BRG and BRG Acquisition Corp. each have
the corporate power to enter into this Agreement, and the execution, delivery
and performance of this Agreement has been duly authorized by all requisite
corporate action, and the Agreement has been, or will be at the Closing Date,
duly executed and delivered and constitute the valid and binding obligations of
BRG and BRG Acquisition Corp.
(c) EFFECT OF AGREEMENT. The execution, delivery and
performance of this Agreement, and the consummation of the transactions herein
contemplated, will not conflict with, or result in a breach of the terms of, or
constitute a default under or violation of, any law or regulation of any
governmental authority, domestic or foreign, the Articles of Incorporation or
Bylaws of BRG or BRG Acquisition Corp., or any material agreement to which
either BRG or BRG Acquisition Corp. is a party or by which either is bound or to
which either is subject. Except for approval of the Agreement and the
transactions contemplated thereby pursuant to BRG's line of credit agreements,
no consent of any person not a party to this Agreement, nor consent of any
governmental authority, except as may be required by applicable state blue sky
regulatory agencies, is required to be obtained on the part of BRG or BRG
Acquisition Corp. to consummate the transactions contemplated by this Agreement.
(d) FULL DISCLOSURE. Any information furnished by or on
behalf of BRG or BRG Acquisition Corp. to OFN in writing pursuant to this
Agreement and any information contained in the BRG and BRG Acquisition Corp.
Disclosure Schedule referred to in this Agreement, at any time prior to the
Closing Date, do not and will not contain any untrue statement of a material
fact and do not and will not omit to state any material fact necessary to make
any statement, in light of the circumstances under which each statement is made,
not misleading.
6. CONDITIONS TO OBLIGATIONS OF BRG AND BRG ACQUISITION CORP. Absent
a waiver in writing, all obligations of BRG and BRG Acquisition Corp. under this
Agreement are subject to the satisfaction of the following conditions, to BRG's
reasonable satisfaction, on or before the completion of the Closing on the
Closing Date:
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(a) REPRESENTATIONS, WARRANTIES AND PERFORMANCE. The
representations and warranties of OFN and the Shareholder contained in this
Agreement shall be deemed to have been made again at and as of the Closing Date
and shall then be true and correct with the same force and effect as if such
representations and warranties have been made at and as of the Closing Date, and
OFN and the Shareholder shall have performed and complied with all agreements,
conditions and covenants required by this Agreement to be performed or complied
with by them prior to or at the Closing Date.
(b) LITIGATION. There shall not be pending any litigation
before any court or governmental agency (i) the outcome of which could
reasonably be expected to have a material adverse affect on the Purchased Assets
or their value to BRG or BRG Acquisition Corp., or (ii) to restrain or prohibit
or to obtain damages or other relief in connection with, or which is related to
or arises out of, this Agreement or the transactions contemplated hereby.
(c) CERTAIN ASSIGNMENTS. Assignments of the Assumed
Contracts shall have been received to BRG's reasonable satisfaction.
(d) ABSENCE OF MATERIAL CHANGES. There shall not have been
any adverse change in or to the Purchased Assets or revenues obtained or
anticipated to be obtained therefrom.
(e) APPROVALS. All consents, approvals and filings required
under any applicable law, rule or regulation, or under any applicable contract,
to be completed or obtained prior to the transactions contemplated by this
Agreement shall have been so completed or obtained, as the case may be, to BRG's
reasonable satisfaction.
(f) CORPORATE APPROVAL. The Board of Directors of OFN and
the Shareholder shall have approved this Agreement and the transactions
contemplated by this Agreement in a manner consistent with applicable law and
the Articles of Incorporation and Bylaws of OFN.
(g) EMPLOYMENT AGREEMENT. At the Closing, Xxxxx Xxxxxxxx
shall have executed and delivered an employment agreement (the "Employment
Agreement") in form and substance satisfactory to BRG.
(h) LOAN REPAYMENT. Xxxxx Xxxxxxxx shall have repaid in
full the principal amount of $250,000 and any accrued interest owed by him to
OFN pursuant to the promissory note between such parties dated April 1, 1998.
7. CONDITIONS TO OBLIGATIONS OF OFN. Absent a waiver in writing, all
obligations of OFN under this Agreement are subject to the satisfaction of the
following conditions, to OFN's reasonable satisfaction, on or before the
completion of the Closing on the Closing Date:
(a) REPRESENTATIONS, WARRANTIES AND PERFORMANCE. The
representations and warranties of BRG and BRG Acquisition Corp. contained in
this Agreement shall be deemed to have been made again at and as of the Closing
Date and shall then be true and correct with the
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same force and effect as if such representations and warranties had been made at
and as of the Closing Date, and BRG and BRG Acquisition Corp. shall have
performed and complied with all agreements, conditions and covenants required by
this Agreement to be performed or complied with by each respective entity prior
to or at the Closing Date.
(b) LITIGATION. There shall not be pending any litigation
before any court or governmental agency to restrain or prohibit or to obtain
damages or other relief in connection with, or which is related to or arises out
of, this Agreement or the transactions contemplated hereby, or which could
reasonably be expected to have a material adverse effect upon the ability of BRG
or BRG Acquisition Corp. to perform its respective obligations under this
Agreement.
(c) APPROVALS. All consents, approvals and filings required
under any applicable law, rule or regulation, or under any applicable contract,
to be completed or obtained prior to the transactions contemplated by this
Agreement shall have been so completed or obtained, as the case may be, to OFN's
reasonable satisfaction.
(d) CORPORATE APPROVAL. Each of the Board of Directors of
BRG and BRG Acquisition Corp. shall have approved this Agreement and the
transactions contemplated by this Agreement in a manner consistent with
applicable law and the Articles of Incorporation and Bylaws of BRG and BRG
Acquisition Corp., respectively.
(e) EMPLOYMENT AGREEMENT. At the Closing, Xxxxx Xxxxxxxx
shall have executed and delivered the Employment Agreement, which Employment
Agreement shall also be satisfactory in form and substance to Xxxxx Xxxxxxxx.
(f) APPOINTMENT OF PRESIDENT. At the Closing, Xxxxx
Xxxxxxxx shall have been appointed as President of BRG Acquisition Corp.
pursuant to the Employment Agreement.
8. COVENANTS FOLLOWING CLOSING.
(a) OPERATIONS FOLLOWING THE CLOSING.
(i) BRG ACQUISITION CORP. Notwithstanding any
other provision in this Agreement to the contrary, BRG, BRG Acquisition Corp.,
OFN and the Shareholder each understand and agree that after the Closing, BRG
Acquisition Corp. shall own the Purchased Assets free and clear of all liens and
encumbrances, and that nothing in this Agreement shall be construed to limit
either BRG's or BRG Acquisition Corp.'s respective rights to manage and operate
BRG Acquisition Corp., the Purchased Assets and the Assumed Liabilities in any
manner, or to sell, liquidate or otherwise dispose of BRG Acquisition Corp., the
Purchased Assets or the Assumed Liabilities in BRG's sole discretion (provided
that BRG's obligation to satisfy obligations pursuant to the Assumed
Liabilities, the Shares, the Cash Payment, the Note, the Tax Payment and the
Options, and to indemnify OFN and the Shareholder pursuant to Section 8(c)
below, shall remain in full force and effect).
(ii) EMPLOYEES. Prior to the Closing, BRG
Acquisition Corp. will make employment offers to all of the employees of OFN as
identified on Exhibit H upon the
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existing salary terms set forth on such exhibit. Such employment will be subject
to BRG Acquisition Corp.'s policies generally applicable to new employees. All
such persons who agree to become employees of BRG Acquisition Corp. shall
execute and deliver a Confidentiality and Assignment Agreement in the form
attached hereto as Exhibit J.
(iii) STOCK OPTIONS. Options to purchase shares
of Common Stock of BRG having an aggregate exercise price equal to $75,000
(excluding the option to purchase 40,000 shares to be granted to Xxxxx Xxxxxxxx
pursuant to the terms of the Employment Agreement) of BRG's Common Stock based
upon the fair market value of such shares of Common Stock pursuant to BRG's 1995
Stock Option Plan shall be granted to the Optionees identified on and in the
amounts set forth on Exhibit E.
(iv) CHANGE OF CORPORATE NAME. Promptly
following the Closing, the parties shall each use its best efforts to change the
name of OFN to "Xxxxxxxx Holdings, Inc." and to change the name of BRG
Acquisition Corp. to "Office Furniture Networking."
(b) RELEASE OF LIENS AND CONSENTS. OFN and the Shareholder
shall take all reasonable actions as may be necessary to (1) release any
outstanding liens or encumbrances on the Purchased Assets, and (2) obtain such
consents as may be necessary for the transfer of the Assumed Contracts to BRG
Acquisition Corp. in accordance with the terms of this Agreement.
(c) INDEMNIFICATION.
(i) BY OFN AND THE SHAREHOLDER. OFN and the
Shareholder jointly and severally agree to indemnify BRG and/or BRG Acquisition
Corp. and hold BRG and/or BRG Acquisition Corp. harmless from and against, and
to reimburse BRG and/or BRG Acquisition Corp. in respect of, any and all
damages, losses, liabilities, claims, judgments, settlements, penalties, costs
and expenses (including attorneys' fees and costs) of every nature reasonably
incurred by BRG and/or BRG Acquisition Corp., whether absolute or contingent,
including costs of investigation and defense, arising from or in connection with
(A) any Non-Assumed Liabilities, (B) any breach or inaccuracy of or omission
from any of the representations, warranties or covenants of OFN or the
Shareholder set forth in this Agreement, or (C) any non-compliance with
applicable bulk sales laws, provided, in the case of any liability under the
foregoing clause (C), BRG provides OFN and the Shareholder with (i) prompt
written notice of any claim or liability arising out of such noncompliance, (ii)
sole control and authority over the defense or settlement thereof and (iii)
proper and full information and reasonable assistance to defend and/or settle
any such claim or liability.
(ii) BY BRG AND BRG ACQUISITION CORP. BRG and
BRG Acquisition Corp. jointly and severally agree to indemnify OFN and the
Shareholder and hold OFN and the Shareholder harmless from and against, and to
reimburse OFN and the Shareholder in respect of, any and all damages, losses,
liabilities, claims, judgments, settlements, penalties, costs and expenses
(including attorneys' fees and costs) of every nature reasonably incurred by
either of them, whether absolute or contingent, including costs of investigation
and defense, arising from or in connection with the Assumed Liabilities and the
conduct of BRG Acquisition Corp. following the Closing Date.
-11-
12
(d) OFN'S EMPLOYEES. OFN agrees that, except as otherwise
expressly provided herein, it shall bear sole responsibility for all amounts due
and payable or otherwise arising with respect to OFN employees at and prior to
the Closing Date, including, but not limited to, all salaries, wages,
commissions, profit and revenue sharing, and holiday, vacation and severance
pay, bonuses and past service credits and shall have made and remitted, for all
periods through and including the Closing Date, all payroll deductions,
remittances and contributions, including, but not limited, to, employees'
salaries and wages, commissions, bonuses and profit-sharing required under
contract, any collective bargaining agreements or applicable laws and
regulations.
(e) ASSUMED CONTRACTS. Notwithstanding any other provision
in this Agreement to the contrary, OFN and the Shareholder accept and
acknowledge full responsibility for payment of all obligations under the Assumed
Contracts that were incurred or created or that otherwise arose prior to the
Closing Date.
(f) CONFIDENTIALITY. Each party hereto agrees that, except
with the prior written permission of the other parties hereto, it shall at all
times keep confidential and not divulge, furnish or make accessible to anyone
any confidential information, knowledge or other information concerning or
relating to (1) the business or financial affairs of the other parties to which
such party has been or shall become privy by reason of this Agreement, (2) the
terms of this Agreement or any other agreement contemplated or executed hereby,
(3) the content of any discussions or negotiations relating to this Agreement or
the transactions and other agreements contemplated or executed hereby and (4)
the performance of obligations hereunder; provided, however, that each party may
disclose the terms and conditions of this Agreement (i) as required by any court
or other governmental body or as otherwise required by law, (ii) to legal
counsel of the parties, (iii) in confidence to accountants, banks, and financing
sources and their advisors, (iv) in connection with the enforcement of this
Agreement or rights under this Agreement or (v) in confidence by BRG in
connection with an actual or proposed merger, acquisition, or similar
transaction. The provisions of this Section 8(f) shall be in addition to, and
not in substitution for, the provisions of any separate nondisclosure agreement
executed by the parties hereto with respect to the transactions contemplated
hereby.
9. MISCELLANEOUS.
(a) SURVIVAL OF REPRESENTATIONS AND WARRANTIES. All
representations and warranties of BRG, BRG Acquisition Corp., OFN and the
Shareholder made in this Agreement or in any certificate, document or other
instrument delivered pursuant hereto shall survive for a period of two years
following the execution and delivery hereof and the Closing; provided, however,
that the representations and warranties of OFN and the Shareholder set forth in
Section 3(n) ("Taxes") shall survive until all applicable statutes of
limitations, including waivers and extensions thereof, have expired with respect
to each matter addressed therein, and shall thereafter automatically expire. Any
actions or claims brought pursuant to this Section 9(a) shall be brought within
six (6) months of the respective designated survival periods described in the
immediately preceding sentence.
-12-
13
(b) FEES AND EXPENSES. Each of the parties hereto shall
bear its own fees and expenses, including fees of counsel and accountants,
incurred in connection with the negotiation of this Agreement and the
consummation of the transactions contemplated hereby or otherwise arising out
of, or by reason of, this Agreement.
(c) ENTIRE AGREEMENT; THIRD PARTY BENEFICIARIES. This
Agreement and the exhibits and schedules hereto constitute the entire agreement
among the parties hereto and thereto with respect to the subject matter hereof
and thereof and supersede all prior and contemporaneous agreements, term sheets,
understandings, negotiations and discussions, whether oral or written, of the
parties with respect thereto. The parties hereto acknowledge and agree that no
third party (including, without limitation, employees of OFN) is intended to be
a third-party beneficiary of this Agreement.
(d) AMENDMENTS. No amendment, modification or rescission of
this Agreement shall be effective unless set forth in writing executed by the
party sought to be bound thereby.
(e) NOTICES. Any notice given under this Agreement shall be
in writing and shall be deemed effective upon the earlier of personal delivery
(including personal delivery by telex or other means) to the President of such
party or to such party if an individual, the day after delivery by commercial
courier or the third day after mailing by certified or registered mail, postage
prepaid, to the address first set forth above (Attention: President, in the case
of OFN, BRG or BRG Acquisition Corp.), or to such other address as any party may
have furnished in writing to the other party in the manner provided above.
(f) ASSIGNMENT. None of OFN or either Shareholder may
assign this Agreement or any of its rights hereunder in any manner without the
prior written consent of BRG and BRG Acquisition Corp. BRG may not assign its
obligation under this Agreement to issue the Shares. Subject to the foregoing,
this Agreement shall be binding upon and shall inure to the benefit of the
parties hereto and their respective transferees, successors, assigns and legal
representatives.
(h) GOVERNING LAW. This Agreement and the respective rights
and obligations of the parties in this Agreement shall be construed under and by
the laws of the State of California as such laws are applied to contracts
entered into in that state between residents thereof.
(i) ATTORNEYS' FEES. If any legal action or proceeding is
brought to enforce or interpret this Agreement, or because of an alleged
dispute, breach, default or misrepresentation in connection with this Agreement,
the prevailing party shall be entitled to reasonable attorneys' fees and costs
in connection with such action or proceeding in addition to all other relief to
which such party may be entitled.
(j) NO WAIVER. It is understood and agreed that no failure
or delay by any party in exercising any right, power, or privilege hereunder
shall operate as a waiver thereof, nor
-13-
14
shall any single or partial exercise of any right, power or privilege be deemed
to operate as a waiver of any other right, power or privilege under this
Agreement.
(k) COUNTERPARTS. This Agreement may be executed in any
number of counterparts, each of which shall be considered to be an original, but
all of which together shall constitute one and the same instrument.
(l) ADVICE OF COUNSEL. EACH PARTY TO THIS AGREEMENT
ACKNOWLEDGES THAT, IN EXECUTING THIS AGREEMENT, SUCH PARTY HAS HAD THE
OPPORTUNITY TO SEEK THE ADVICE OF INDEPENDENT LEGAL COUNSEL, AND HAS READ AND
UNDERSTOOD ALL OF THE TERMS AND PROVISIONS OF THIS AGREEMENT. THIS AGREEMENT
SHALL NOT BE CONSTRUED AGAINST ANY PARTY BY REASON OF THE DRAFTING OR
PREPARATION HEREOF.
(Signature Page Follows)
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15
The parties hereto have duly executed this Asset Purchase Agreement
as of the date first set forth above.
BUSINESS RESOURCE GROUP, BRG ACQUISITION CORP.,
a California corporation a California corporation
By: /s/ X.X. Xxxx By: /s/ X.X. Xxxx
------------------------------- -------------------------------
Name: X.X. Xxxx Name: X.X. Xxxx
------------------------------- -------------------------------
Title: President and CEO Title: CEO
------------------------------- -------------------------------
XXXXX & XXXXXXX XXXXXXXX, OFFICE FURNITURE NETWORKING, INC.,
HUSBAND AND WIFE AS JOINT TENANTS a California corporation
/s/ Xxxxx Xxxxxxxx By: /s/ Xxxxx Xxxxxxxx
----------------------------------- -------------------------------
Xxxxx Xxxxxxxx
Name: Xxxxx Xxxxxxxx
-----------------------------
/s/ Xxxxxxx Xxxxxxxx Title: President
----------------------------------- ----------------------------
Xxxxxxx Xxxxxxxx
-15-
16
LIST OF EXHIBITS
Exhibit A Purchased Assets
Exhibit B Assumed Liabilities
Exhibit C Form of Promissory Note
Exhibit D List of Optionees
Exhibit E Xxxx of Sale
Exhibit F Purchase Price Allocation
Exhibit G OFN Disclosure Schedule
Exhibit H OFN Employees
Exhibit I BRG and BRG Acquisition Corp. Disclosure Schedule
Exhibit J Form of Confidentiality and Assignment Agreement
17
EXHIBIT A
PURCHASED ASSETS
1. All trademark, tradename or service xxxx rights or other rights to goodwill
in the name "Office Furniture Networking."
2. All trademark, tradename or service xxxx rights or other rights to goodwill
in the name "OFN, INC."
3. Xxxxx Cash: $200
4. Cash: $482,909
5. Accounts Receivable: $203,071
6. Inventory: $489,686
7. Prepaid Insurance: $5,663
8. Prepaid Other: $20,867
9. Office Equipment: $64,502
10. Warehouse Equipment: $29,027
11. Vehicles: $37,051
12. Deposits: $15,200
18
EXHIBIT B
ASSUMED LIABILITIES
1. Standard Industrial/Commercial Multi-Tenant Lease between MBP Associates and
OFN, INC. dated April 1, 1997, and amendments thereto.
2. Standard Industrial/Commercial Single-Tenant Lease between MBP Associates
and Offices Furniture Networking Co. dated October 16, 1992, and amendments
thereto.
3. Accounts Payable: $78,376
4. Accrued Vacation: $19,531
5. Payroll Taxes Payable $329
6. Sales Tax Payable: $13,212
7. Accrued Payroll: $5,222
8. Assumed Contracts: $74,500
19
EXHIBIT C
FORM OF PROMISSORY NOTE
PROMISSORY NOTE
$1,069,204.78 April 1, 0000
Xxx Xxxx, Xxxxxxxxxx
For value received, Business Resource Group, a California corporation
(the "Company"), promises to pay to OFN, INC., d.b.a. Office Furniture
Networking, a California corporation (the "Holder"), the principal sum of One
Million Sixty Nine Thousand Two Hundred Four Dollars and Seventy Eight Cents
($1,069,204.78). Interest shall accrue from the date of this Note on the unpaid
principal amount at a rate equal to six percent (6%) per annum, compounded
annually. This Note is subject to the following terms and conditions:
1. MATURITY. Accrued interest shall be due and payable with each
installment of principal. The principal and accrued interest on this Note will
automatically mature and be due and payable in three equal annual installments
of $400,000 each (together, the "Installment Payments" and each an "Installment
Payment"). Each Installment Payment amount includes both principal and accrued
interest as of the respective installment payment date and is intended to result
in aggregate proceeds to the Holder (principal plus interest) of $1,200,000 at
the end of the payment term. The first Installment Payment will be due April 1,
1999, with remaining payments due April 1, 2000 and April 1, 2001.
2. PAYMENT. All payments shall be made in lawful money of the United
States of America at such place as the Holder hereof may from time to time
designate in writing to the Company. Prepayment of this Note in full may be made
at any time without penalty; provided, however, that if the Company elects to
prepay the Note, the prepayment amount together with any Installment Payment(s)
made at the time of such prepayment must equal $1,200,000, the principal plus
all interest due under the Note pursuant to Section 1 above.
3. TRANSFER; SUCCESSORS AND ASSIGNS. The terms and conditions of this
Note shall inure to the benefit of and be binding upon the respective successors
and assigns of the parties. Notwithstanding the foregoing, the Holder may not
assign, pledge, or otherwise transfer this Note without the prior written
consent of the Company, except that this Note may be transferred to (i) other
corporations, partnerships or similar entities under the sole control of Xxxxx
and Xxxxxxx Xxxxxxxx, or either of them, but in any such case without any
further consideration in connection with such transfer, (ii) by either of such
individuals to the other as an interspousal transfer without further
consideration, (iii) to any lineal ancestors or descendants of either of such
individuals without further consideration or (iv) to any trust for the benefit
of any of the persons in items (ii) or (iii) without further consideration.
Subject to the preceding sentence, this Note may be transferred only upon
surrender of the original Note for registration of transfer, duly endorsed, or
accompanied by a duly executed written instrument of transfer in form
satisfactory to the Company. Thereupon, a new note for the same principal amount
and interest will be issued to, and registered in the name of, the transferee.
Interest and principal are payable only to the registered holder of this Note.
20
4. GOVERNING LAW. This Note and all acts and transactions pursuant
hereto and the rights and obligations of the parties hereto shall be governed,
construed and interpreted in accordance with the laws of the State of
California, without giving effect to principles of conflicts of law.
5. NOTICES. Any notice required or permitted by this Note shall be in
writing and shall be deemed sufficient upon delivery, when delivered personally
or by a nationally-recognized delivery service (such as FedEx or UPS), or
forty-eight (48) hours after being deposited in the U.S. mail, as certified or
registered mail, with postage prepaid, addressed to the party to be notified at
such party's address as set forth below or as subsequently modified by written
notice.
6. AMENDMENTS AND WAIVERS. Any term of this Note may be amended only
with the written consent of the Company and the Holder. Any amendment or waiver
effected in accordance with this Section 6 shall be binding upon the Company,
the Holder and each transferee of the Note.
7. SHAREHOLDERS, OFFICERS AND DIRECTORS NOT LIABLE. In no event shall
any shareholder, officer or director of the Company be liable for any amounts
due or payable pursuant to this Note.
8. ACTION TO COLLECT ON NOTE. If action is instituted to collect on this
Note, the Company promises to pay all costs and expenses, including reasonable
attorney's fees, incurred in connection with such action.
COMPANY:
BUSINESS RESOURCE GROUP
By:________________________________________
Name:______________________________________
(print)
Title:_____________________________________
Address: 0000 Xxxxx Xxxxx Xxxxxx
Xxxxx 000
Xxx Xxxx, XX 00000
AGREED TO AND ACCEPTED:
OFN, INC.
By: ___________________________
Name: _________________________
(print)
Title: __________________________
21
EXHIBIT D
LIST OF OPTIONEES
Xxx Xxxxxxx - 5,000 shares
Xxxx Xxxxxx - 4,000 shares
Xxxx Cellar - 4,000 shares
Xxxxx Xxxxxxx - 3,000 shares
Xxxxxx Xxxxx - 3,000 shares
Xxxxx Xxxxx - 2,000 shares
Art Xxxxxxxx - 2,000 shares
Xxxxx Xxxxxxx - 2,000 shares
22
EXHIBIT E
XXXX OF SALE
Know all persons by these presents, that OFN, INC., d.b.a. Office
Furniture Networking, a California corporation, Xxxxx & Xxxxxxx Xxxxxxxx,
Husband and Wife as Joint Tenants (the "Transferor"), in exchange for
consideration set forth in the Asset Purchase Agreement (the "Agreement") dated
as of May 22, 1998, by and among the Transferor, Business Resource Group, a
California corporation ("BRG"), and BRG Acquisition Corp., a wholly-owned
subsidiary of BRG and a California corporation (the "Transferee"), hereby sell,
transfer, assign and convey unto Transferee, its successors and assigns, free
and clear of all liens and encumbrances, all of the right, title and interest of
Transferors in and to the Purchased Assets (as described in the Agreement).
TO HAVE AND TO HOLD the same unto the Transferee, its successors or
assigns, forever, and the Transferor does hereby covenant and agree that the
Transferor will from time to time, if requested by the Transferee, its
successors and assigns, do, execute, acknowledge and deliver, or will cause to
be done, executed and delivered to the Transferee, or its successors or assigns,
such and all further acts, transfers, assignments, deeds, powers and assurances
of title, and additional papers and instruments, and do or cause to be done all
acts or things as often as may be proper or necessary for better assuring,
conveying, transferring and assigning all of the property hereby conveyed,
transferred or assigned, and effectively to carry out the intent hereof, and to
vest in the Transferee the entire right, title and interest of the Transferor in
and to all of the said property, and the Transferor will warrant and defend the
same to the Transferee, its successors and assigns, forever against all claims
or demands whatsoever.
IN WITNESS WHEREOF, the Transferor has executed this instrument as of
May 22, 1998
OFFICE FURNITURE NETWORKING
By: _______________________________________
Title: ____________________________________
XXXXX & XXXXXXX XXXXXXXX,
HUSBAND AND WIFE AS JOINT TENANTS
------------------------------------
Xxxxx Xxxxxxxx
------------------------------------
Xxxxxxx Xxxxxxxx
23
EXHIBIT F
PURCHASE PRICE ALLOCATION
Cash: $2,000,000 Xxxxx Cash: $200
Notes: $1,069,205 Cash: $482,909
Stock: $250,000 Accounts Receivable: $203,071
Cash-Tax Reimbursement: $93,000 Inventory: $489,686
Accounts Payable: $78,376 Prepaid Insurance: $5,663
Accrued Vacation: $19,531 Prepaid Other: $20,867
Payroll Taxes Payable: $329 Office Equipment: $64,502
Sales Tax Payable: $13,212 Warehouse Equipment: $29,027
Accrued Payroll: $5,222 Vehicles: $37,052
Accrued Bonuses: $75,000 Accumulated Depreciation: ($85,358)
TOTAL CONSIDERATION: $3,603,875 Deposits: $15,200
Goodwill: $2,341,056
TOTAL ALLOCATION: $3,603,875
24
EXHIBIT G
OFN DISCLOSURE SCHEDULE
1. Xxxx Xxxxx, X-Employee: Claim for 8 days' accrued vacation pay.
2. Pending Purchases.
25
EXHIBIT H
OFN EMPLOYEES
Employee: Rate Pay:
Xxxxx Xxxxxxx 13.50
Xxxxx Xxxxx 12.50
Xxxxx Xxxxxxx 10.00
Xxxxxx Xxxxxxx 22.83 + bonus
Xxxx Xxxxxxxx 12.00
Xxxx Xxxxxx 16.82 + bonus
Xxxxx Xxxxxxx 12.50
Xxxx Xxxxxxxx 10.50
Xxxxx Xxxxx 14.20 + bonus
Xxxxxx Xxxxxxxx 14.20
Xxxxxxx Xxxxxxxx 36.05
Xxxxx Xxxxxx 9.50
Xxxx Cellar 14.42 + comm.
Xxxxx Xxxxxxx 10.00
Xxxxx Xxxxxxxx 120.19 (upon sale closing 96.15)
Xxxxx Xxxxxxxx 12.00
Xxxxxx Xxxxxxx 12.00
26
EXHIBIT I
BRG AND BRG ACQUISITION CORP. DISCLOSURE SCHEDULE
NONE
27
EXHIBIT J
FORM OF CONFIDENTIALITY AND ASSIGNMENT AGREEMENT
BRG ACQUISITION CORP.
CONFIDENTIALITY AND ASSIGNMENT AGREEMENT
In consideration of, and as a condition of my employment with BRG
Acquisition Corp., a California corporation (the "Company") doing business in
the State of California located at 0000 Xxxxx Xxxxx Xxxxxx, Xxxxx 000, Xxx Xxxx,
XX 00000, I hereby represent to and agree with the Company as follows:
1. PURPOSE OF AGREEMENT. I understand that the Company is engaged in
a continuous program of production, sales and marketing in connection with its
business and that it is critical for the Company to preserve and protect its
Proprietary Information (as defined below), its rights in Inventions (as defined
below) and in all related rights.
2. DISCLOSURE OF INVENTIONS. I will promptly disclose in confidence
to the Company all inventions, improvements, designs, original works of
authorship, processes, computer software programs, databases and trade secrets
("Inventions") that I make or conceive or first reduce to practice or create,
either alone or jointly with others, during the period of my employment, whether
or not in the course of my employment.
3. WORK FOR HIRE; ASSIGNMENT OF INVENTIONS. I acknowledge and agree
that any copyrightable works prepared by me within the scope of my employment
are "works for hire" under the Copyright Act and that the Company will be
considered the author and owner of such copyrightable works. I agree that all
Inventions, and all patent, copyright, trade secret, and other intellectual
property rights relating to such Inventions, that (a) are developed using
equipment, supplies, facilities or trade secrets of the Company, (b) result from
work performed by me for the Company, or (c) relate to the Company's business or
current or anticipated research and development, will be the sole and exclusive
property of the Company and are hereby irrevocably assigned by me to the
Company.
4. ASSISTANCE. I agree to assist the Company in every proper way to
obtain for the Company and enforce patents, copyrights, mask work rights, trade
secret rights and other legal protections for the Company's Inventions in any
and all countries and I will execute any documents that the Company may
reasonably request for such purpose both before and after my employment with the
Company terminates. I hereby appoint the Secretary of the Company as my
attorney-in-fact to execute documents on my behalf for this purpose.
5. PROPRIETARY INFORMATION. I understand that my employment by the
Company creates a relationship of confidence and trust with respect to any
information of a confidential or secret nature that may be disclosed to me by
the Company that relates to the business of the Company or to the business of
any parent, subsidiary, affiliate, customer or supplier of the Company or any
other party with whom the Company agrees to hold information of such party in
28
confidence ("Proprietary Information"). Such Proprietary Information includes
but is not limited to Inventions, marketing plans, product plans, business
strategies, financial information, forecasts, personnel information and customer
lists.
6. CONFIDENTIALITY. At all times, both during my employment and
after its termination, I will keep and hold all such Proprietary Information in
strict confidence and trust, and I will not use or disclose any of such
Proprietary Information without the prior written consent of the Company, except
as may be necessary to perform my duties as an employee of the Company for the
benefit of the Company. Upon termination of my employment with the Company, I
will promptly deliver to the Company all documents and materials of any nature
pertaining to my work, including without limitation all documents and materials
containing Proprietary Information. My obligations under Section 5 above and
this Section 6 shall survive any termination of my employment with the Company.
7. NO BREACH OF PRIOR AGREEMENT. I represent that my performance of
all the terms of this Agreement and my duties as an employee of the Company will
not breach any invention assignment, proprietary information or similar
agreement with any former employer or other party. I represent that I will not
bring with me to the Company or use in the performance of my duties for the
Company any documents or materials of a former employer that are not generally
available to the public or have not been legally transferred to the Company.
8. SEVERABILITY. In the event that any provision of this Agreement
is found by a court, arbitrator or other tribunal to be illegal, invalid or
unenforceable, then such provision shall not be voided, but shall be enforced to
the maximum extent permissible under applicable law, and the remainder of this
Agreement shall remain in full force and effect.
9. NO DUTY TO EMPLOY. I understand that this Agreement does not
constitute a contract of employment or obligate the Company to employ me for any
stated period of time. This Agreement shall be effective as of the first day of
my employment by the Company.
10. ASSIGNMENT. I agree that this Agreement may be assigned to any
successor or parent corporation of the Company.
11. GOVERNING LAW. This Agreement and all acts and transactions
pursuant hereto and the rights and obligations of the parties hereto shall be
governed, construed and interpreted in accordance with the laws of the State of
California, without reference to rules of conflict of law.
12. REMEDIES. I understand and acknowledge that any breach or
threatened breach of this Agreement by me is likely to cause or threaten
irreparable harm to the Company, and, accordingly, I agree that in such event,
the Company shall be entitled to equitable relief to protect its interest
therein, including but not limited to preliminary and permanent injunctive or
mandatory relief, as well as money damages. This Section 12 shall survive any
termination of my employment with the Company.
13. ENTIRE AGREEMENT. This Agreement sets forth the entire Agreement
and understanding of the parties relating to its subject matter and merges all
prior discussions and
29
agreements between them. No modification or amendment to this Agreement, nor any
waiver of any rights under this Agreement, will be effective unless in writing
signed by both parties.
14. COUNTERPARTS. This Agreement may be executed in two or more
counterparts, each of which shall be deemed an original and all of which
together shall constitute one instrument.
30
IN WITNESS WHEREOF, the parties have executed this Agreement as of May
22,1998.
BRG ACQUISITION CORP. EMPLOYEE:
("COMPANY")____
By: _____________________________ ______________________________
(Signature)
Title: ____________________________ ______________________________
Address: 0000 Xxxxx Xxxxx Xxxxxx (Name Printed)
Xxxxx 000
Xxx Xxxx, XX 00000 Address: _____________________
