ACQUISITION AGREEMENT
This ACQUISITION AGREEMENT, dated as of March 19, 1999, is between Micron
Technology, Inc., a Delaware corporation ("Micron"), and PixTech, Inc., a
Delaware corporation ("PixTech").
W I T N E S S E T H :
WHEREAS, Micron desires to sell to PixTech and PixTech desires to purchase
from Micron substantially all of the assets of Micron's Display Division
Business, upon the terms and conditions set forth herein;
NOW, THEREFORE, in consideration of the premises, and of the
representations, warranties, covenants and agreements set forth herein, the
parties hereto hereby agree as follows:
ARTICLE I
DEFINITIONS
ARTICLE I DEFINITIONS
SECTION I.1. Definitions.
(A) The following terms, as used herein, have the following meanings:
"Acquired Assets" means all of Micron's right, title and interest in (i)
the assets relating primarily or solely to the Display Division Business located
at 0000 Xxxxx Xxxxxx Xxx, Xxxxx, Xxxxx 00000, Boise, Idaho and which are more
particularly described on Schedule 1.1-A to this Agreement, and (ii) all of
Micron's rights under the Assumed Contracts.
"Acquired Business" means the Acquired Assets and the Assumed Liabilities.
"Affiliate" means, with respect to any Person, any other Person directly or
indirectly controlling, controlled by, or under common control with such Person.
For purposes of this definition, "control" when used with respect to any Person,
means the possession, directly or indirectly, of the power to direct or cause
the direction of the management and policies of such Person, whether through the
ownership of voting securities, by contract or otherwise; the terms
"controlling" and "controlled" have meanings correlative to the foregoing.
"Ancillary Agreements" means the Lease Agreement, the Patent Cross License
Agreement, the Micron Noncompete Agreement, the PixTech Warrant, the Investor
Rights Agreement, the Micron Guaranty, the PixTech Security Agreement and the
Consulting Agreement, and each other document or agreement delivered by Micron
or PixTech in connection with this Agreement.
"Assumed Contracts" means those contracts, agreements, leases, commitments
and sales and purchase orders of Micron relating to the Display Division
Business listed on Schedule 1.1-B to this Agreement.
"Assumed Liabilities" means those debts, obligations, contracts and
liabilities of Micron of related to or arising out of the conduct of the Display
Division Business listed on Schedule 1.1-C to this Agreement.
"BancBoston" means BancBoston Leasing, Inc.
"CERCLA" means the Comprehensive Environmental Response, Compensation and
Liability Act of 1980, as amended on or prior to the date hereof, and any rules
or regulations promulgated thereunder.
"Closing Date" means the date of the Closing.
"Code" means the Internal Revenue Code of 1986, as amended.
"Consulting Agreement" means the consulting agreement among Micron, PixTech
and Xxxxx X. Xxxxxx, in form and substance reasonably satisfactory to Micron,
PixTech and Xxxxx X. Xxxxxx, containing, among other terms, the terms contained
in Schedule 9.5.
"DARPA" means the United States Defense Advance Research Projects Agency.
"DARPA Contract" means the agreements, as amended, between Micron and DARPA
relating to the development of a field emission display for use in an M1A2 tank
(Contract Nos. DABT 63-97-C-0001, DAB 63-94-C-0012, DAAB 07-97-C-J033 and DABT
63-93-C-0025).
"Display Division Business" means Micron's worldwide operations relating to
its Display Division, including the development, manufacture and sale of field
emission displays.
"Display Division Financing Agreements" means (i) the Security Agreement
dated February 21, 1997 by and between Micron Display Technology, Inc. and
BancBoston, the Promissory Note #1, dated February 21, 1997 by Micron Display
Technology, Inc. in favor of BancBoston, and the Assumption Agreement dated
December 30, 1997 by and between BancBoston and Micron; and (ii) the Amended and
Restated Promissory Note H-1D dated October 31, 1997 by Micron in favor of
Xxxxxx, the Amended and Restated Master Security Agreement dated October 31,
1997 by and between Micron and Xxxxxx, and the Assumption Agreement dated
October 31, 1997, by and between Micron and Xxxxxx.
"Environmental Laws" means any and all statutes, laws, regulations and
rules, in each case as in effect on the date hereof, that have as their
principal purpose the protection of human health, safety and the environment.
"Excluded Liabilities" means those debts, obligations, contracts and
liabilities of Micron other than Assumed Liabilities listed on Schedule 1.1-C to
this Agreement.
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"Hazardous Substance" means (i) any chemicals, materials or substances
defined as or included in the definition of "hazardous substances," "hazardous
wastes," "hazardous materials," "extremely hazardous wastes," "restricted
hazardous wastes, " " toxic substances," "toxic pollutants," "hazardous air
pollutants," "contaminants," "toxic chemicals," "toxic," "hazardous chemicals,"
"extremely hazardous substances," "pesticides," "oil" or related materials as
defined in any applicable Environmental Law or (ii) any petroleum or petroleum
products, oil, natural or synthetic gas, radioactive materials,
asbestos-containing materials, urea formaldehyde foam insulation, and radon.
"Xxxxxx" means Xxxxxx Financial, Inc.
"HSR Act" means the Xxxx-Xxxxx-Xxxxxx Antitrust Improvements Act of 1976,
as amended.
"Intellectual Property" means all rights arising out of: (i) patents,
pending patent applications and patent invention disclosures for which patent
applications have not yet been filed ("Patents"); (ii) trade secrets and know
how ("Trade Secrets"); (iii) trademarks, servicemarks and applications for
registration of such ("Trademarks"); (iv) copyrights, copyright registrations
and applications for registration ("Copyrights"); and (v) mask works, mask work
registrations and applications for such registration ("Mask Works"). "Non-Patent
Intellectual Property," as used in Section X shall consist of rights arising out
of the subject matter of forgoing categories (ii) through (v).
"Investor Rights Agreement" means the investor rights agreement
substantially in the form attached hereto as Exhibit A.
"Lease Agreement" means the lease agreement substantially in the form
attached hereto as Exhibit B with respect to the real property and premises
located at 0000 Xxxxx Xxxxxx Xxx, Xxxxx, Xxxxx 00000.
"Licensed Intellectual Property" means the Intellectual Property licensed
to PixTech pursuant to Section X herein.
"Lien" means, with respect to any property or asset, any mortgage, lien,
pledge, charge, security interest or other encumbrance in respect of such
property or asset.
"Material Adverse Effect" means (i) as to Micron, a material adverse effect
on the business, results of operations or financial condition of the Acquired
Business, taken as whole, except any such effect resulting from or arising in
connection with (x) this Agreement or the transactions contemplated hereby or
(y) changes in economic, regulatory or political conditions, and (ii) as to
PixTech, a material adverse effect on the business, results of operations or
financial condition, of PixTech, taken as whole, except any such effect
resulting from or arising in connection with (x) this Agreement or the
transactions contemplated hereby or (y) changes in economic, regulatory or
political conditions.
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"Micron Guaranty" means the guaranty or other credit support that may be
offered by Micron in favor of the lenders under the Display Division Financing
Agreements on terms required by such lenders and acceptable to Micron.
"1934 Act" means the Securities Exchange Act of 1934, as amended, and the
rules and regulations promulgated thereunder.
"Patent Cross License Agreement" means the patent cross license agreement
in the form attached hereto as Exhibit C.
"Person" means an individual, corporation, partnership, limited liability
company, association, trust or other entity or organization, including a
government or political subdivision or an agency or instrumentality thereof.
"PixTech Closing Market Price" means $1.825.
"PixTech Warrant Agreement" means the warrant agreement substantially in
the form attached hereto as Exhibit D.
"Required Consents" means the Micron Required Consents and the PixTech
Required Consents.
"SEC" means the Securities and Exchange Commission or any successor agency.
"Securities Act" means the Securities Act of 1933, as amended, and the
rules and regulations promulgated thereunder.
"Shares" means the shares of PixTech Common Stock issued as part of the
Display Division Purchase Consideration and the PixTech Common Stock Purchase
Consideration.
"Small Area Display Business" means Micron's field emission display
business relating to flat panel screens of 0.55 inch or less diagonal size.
"Subsidiary" means a corporation, company or other entity:
(a) more than fifty percent (50%) of whose outstanding shares or
securities (representing the right to vote for the election of
directors or other managing authority) are, now or hereafter, owned or
controlled by a party hereto or such third party, but such
corporation, company or other entity shall be deemed to be a
Subsidiary only so long as such ownership or control exists; or
(b) which does not have outstanding shares or securities, as may be the
case in a partnership, joint venture or unincorporated association,
but more than fifty percent (50%) of whose ownership interest
representing the right to make the decisions for such corporation,
company or other entity is now or hereafter owned or controlled by
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a party hereto or such third party (regardless of whether such right to
make decisions is exercised or delegated to another), but such corporation,
company or other entity shall be deemed to be a Subsidiary only so long as
such ownership or control exists.
"Tax" means any tax, impost, license, fee, charge, levy, rate, penalty or
other assessment (including, without limitation, any sales, use, income, gross
receipts, net income, bulk sale, franchise, excise, property, and valorem, motor
vehicle, custom, duty, payroll, employment, environmental, net worth, capital,
withholding, occupancy, value-added gains and transfer taxes, any similar tax
and including all interest, penalties, or additions thereto) imposed or asserted
by any governmental authority, whether or not disputed.
"Tax Return" means any return, declaration, report, claim for refund,
information statement relating to Taxes including any schedule attached thereto
and any amendment thereto.
"Transaction Agreements" means this Agreement and the Ancillary Agreements.
(B) Each of the following terms is defined in the Section set forth
opposite such term:
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Term Section
Claim 12.3
Closing 4.1
Damages 12.2
Display Division Purchase Consideration 2.4
GAAP 6.6(b)
Indemnified Party 12.3
Indemnifying Party 12.3
Initial Period 9.6
Micron Disclosure Schedule Article V
Micron Required Consents 5.5
Nondisclosure Agreement 7.2
PixTech Balance Sheet Date 6.6(b)
PixTech Common Stock 2.4(a)
PixTech Disclosure Schedule Article VI
PixTech Required Consents 6.5
PixTech SEC Documents 6.6(a)
PixTech Security Agreement 9.6
PixTech Stockholder Approval 6.5
PixTech Taxes 9.7(b)
PixTech 10-K 6.6(a)
PixTech 10-Q 6.6(a)
PixTech Warrant 2.5(b)
Permits 5.8
Permitted Liens 5.10
Post-Closing Period 9.7(b)
Potential Contributor 12.5
Price Allocation 9.7(a)
Straddle Period 9.7(b)
Third Party Claim 12.3
Transferred Employee 9.5(a)
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ARTICLE II
PURCHASE AND SALE OF DISPLAY DIVISION BUSINESS
SECTION II.1. Purchase and
Upon the terms and subject to the conditions of this Agreement, at the
Closing, PixTech agrees to purchase from Micron, and Micron agrees to sell,
convey, transfer, assign and deliver to PixTech, the Acquired Assets, subject to
all Permitted Liens.
SECTION II.2. Excluded Assets SECTION II.2.
PixTech expressly understands and agrees that the Acquired Assets shall
not include any cash, real property or intellectual property (whether owned by
Micron or licensed to Micron from third parties) relating to the Display
Division Business, except (in the case of cash) to the extent expressly listed
on Schedule 1.1-A to this Agreement and (in the case of licensed intellectual
property) to the extent expressly provided pursuant to Section 9.4. Without
limiting the foregoing, PixTech expressly understands and agrees that while the
Display Division Business may presently benefit from agreements between Micron
and third parties related to the licensing of intellectual properties (whether
such licenses pertain specifically to the Display Division Business or to
Micron's business and operations generally), Micron's rights under such
licensing agreements constitute Excluded Assets.
SECTION II.3. Assumed Liabilities
Upon the terms and subject to the conditions of this Agreement and the
Ancillary Agreements and effective at the time of the Closing, PixTech shall
unconditionally assume and agree to pay, satisfy and discharge when due in
accordance with their terms, and PixTech shall fully and forever hold Micron and
its Affiliates harmless against, any and all Assumed Liabilities.
SECTION II.4. Excluded Liabilities
All Excluded Liabilities shall remain the exclusive liabilities,
obligations and commitments of Micron. However, to the extent necessary, in the
reasonable opinion of Micron, PixTech shall use commercially reasonable efforts
to cooperate with Micron in the defense of any claim or action with respect to
any Excluded Liability; provided, that promptly after written request from
PixTech, Micron shall reimburse PixTech for reasonable expenses (including
attorneys fees) actually incurred by PixTech in cooperating with Micron on such
defense.
SECTION II.5. Display Division Purchase Consideration
The purchase consideration for the Acquired Assets (the "Display Division
Purchase Consideration") shall consist of the following:
(A) 7,133,562 duly authorized, validly issued, fully paid and nonassessable
shares of common stock, $0.01 par value of PixTech ("PixTech Common Stock") as
such number shall be adjusted prior to the Closing Date to reflect any stock
split, stock dividend, recapitalization or other similar events; and
(B) A warrant of PixTech (the "PixTech Warrant"), to purchase 310,000
shares of PixTech Common Stock at $2.25313 (which number
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shall be adjusted prior to the Closing Date to reflect any stock split, stock
dividend, recapitalization or other similar events), exercisable at any time up
to the second anniversary of the Closing Date, which warrants will be issued
pursuant to the PixTech Warrant Agreement.
The Display Division Purchase Consideration shall be paid as provided in
Section 4.1(a).
SECTION II.6. Assignment of Contracts and Rights
This Agreement shall not constitute an agreement to assign any agreement or
any right thereunder if an attempted assignment, without the consent of a third
party, would constitute a breach or in any way adversely affect the rights of
PixTech or Micron thereunder in any material respect. If such consent is not
obtained, Micron and PixTech will cooperate in a mutually agreeable arrangement
under which PixTech would obtain the benefits and assume the obligations
thereunder in accordance with this Agreement. Without limiting the foregoing,
Micron and PixTech agree that PixTech shall not be required to assume the DARPA
Contract that is an Assumed Contract (Contract No. DABT 63-97-C-0001) unless (i)
PixTech will be subject to the same terms and conditions under such DARPA
Contract as are now applicable to Micron and (ii) such DARPA Contract shall be
amended to provide that PixTech's current base plate technology may be used to
manufacture displays required to be delivered to DARPA under such DARPA
Contract.
ARTICLE III
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ARTICLE IV
CLOSING ARTICLE
SECTION IV.1. Closing
The Closing (the "Closing") of the purchase and sale of the Acquired Assets
and the assumption of the Assumed Liabilities hereunder shall take place at the
offices of Xxxxxx Xxxxxxx Xxxxxxxx & Xxxxxx, 000 Xxxx Xxxx Xxxx, Xxxx Xxxx,
Xxxxxxxxxx, as soon as possible, but in no event later than 3 business days,
after satisfaction or waiver of the conditions set forth in Article X, or at
such other time or place as Micron and PixTech may agree. At the Closing:
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(A) PixTech shall deliver to Micron:
(I) a certificate representing the Shares described in Section 2.5(a)
in connection with the Display Division Purchase Consideration; and
(II) the PixTech Warrant;
(B) Micron shall assign and transfer to PixTech all Acquired Assets by
delivery of a General Assignment and Xxxx of Sale in form and substance
reasonably satisfactory to Micron and PixTech, duly executed by Micron;
(C) PixTech shall assume from Micron the due payment, performance and
discharge of the Assumed Liabilities in accordance with the terms of this
Agreement; and
(D) Micron and PixTech shall also deliver the certificates and other
contracts, documents and instruments required to be delivered under Article X,
including the Ancillary Agreements.
ARTICLE V
REPRESENTATIONS AND WARRANTIES OF MICRON
Except as disclosed in the disclosure schedule (the "Micron Disclosure
Schedule") dated the date hereof and delivered by Micron to PixTech in
connection with this Agreement, Micron represents and warrants to PixTech that:
SECTION V.1. Corporate Existence and PowerSECTION V.1.
Micron is a corporation duly incorporated, validly existing and in good
standing under the laws of the State of Delaware and is qualified to do business
as a foreign corporation and is in good standing under the laws of the State of
Idaho.
SECTION V.2. Corporate Authorization
Micron has the requisite corporate power and authority to enter into this
Agreement and the other Transaction Agreements to which it is a party and to
perform its obligations hereunder and thereunder. The execution and delivery of
this Agreement and the other Transaction Agreements to which it is a party, and
performance by Micron of its obligations hereunder and thereunder, have been
duly authorized by all necessary corporate action on the part of Micron. This
Agreement constitutes, and the Ancillary Agreements to which it is a party, when
executed and delivered by Micron, will constitute, valid and legally binding
obligations of Micron, enforceable against the Micron in accordance with their
respective terms, except (i) as may be limited by (x) applicable
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bankruptcy, insolvency, reorganization or others laws of general application
relating to or affecting the enforcement of creditors' rights generally and (y)
the effect of rules of law governing the availability of equitable remedies and
(ii) as rights to indemnity or contribution may be limited under federal or
state securities laws or by principles of public policy thereunder.
SECTION V.3. Governmental Authorization
No consent, approval, order or authorization of, or registration
qualification, designation, declaration or filing with, any federal, state or
local governmental authority on the part of Micron is required in connection
with the consummation of the transactions contemplated by this Agreement,
except: (i) compliance with any applicable requirements of the HSR Act; (ii)
compliance with any applicable requirements of the 1934 Act; and (iii) as may be
necessary in connection with any DARPA Contracts that are Assumed Contracts.
SECTION V.4. Noncontravention
Except as set forth on Schedule 5.4 to the Micron Disclosure Schedule, the
execution, delivery and performance by Micron of each Transaction Agreement to
which it is a party and the consummation of the transactions contemplated
thereby do not and will not (i) violate the Certificate of Incorporation or
Bylaws of Micron, (ii) assuming compliance with the governmental matters
referred to in Section 5.3, violate in any material respect any applicable law,
rule, regulation, judgment, injunction, order or decree, (iii) assuming the
obtaining of all Required Consents, constitute a default under, or give rise to
any right of termination, cancellation or acceleration of any right or
obligation of Micron or to a loss of any benefit to which Micron is entitled
under any provision of any material agreement or other instrument binding upon
Micron, or (iv) result in the creation or imposition of any Lien on any Acquired
Asset except for any Permitted Liens, except, in the case of clauses (ii) and
(iii), individually and in the aggregate, as would not have a Material Adverse
Effect.
SECTION V.5. Required Consents
Schedule 5.5 to the Micron Disclosure Schedule sets forth each material
agreement or other instrument binding upon Micron, including those listed in
Schedule 1.1-B to this Agreement, requiring a consent or other action by any
Person (the "Micron Required Consents") as a result of the execution, delivery
and performance of this Agreement, except such consents or actions as would not,
individually or in the aggregate, have a Material Adverse Effect if not received
or taken by the Closing.
SECTION V.6. Absence of Certain Changes
Except as disclosed in Schedule 5.6 to the Micron Disclosure Schedule,
since January 31, 1999, the Acquired Business has been conducted in the ordinary
course consistent with past practices by Micron and there has not been:
(A) any acquisition by Micron relating to assets or business material to
the Acquired Business, other than in the ordinary course of business consistent
with past practices and as contemplated by this Agreement;
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(B) any sale, lease or disposition by Micron relating to assets or business
material to the Acquired Business, other than in the ordinary course of business
consistent with past practices and as contemplated by this Agreement;
(C) any (i) employment, deferred compensation, severance, retirement or
other similar agreement (or any amendment to any such existing agreement)
entered into with any director, officer or employee of Micron engaged primarily
in the operations of the Acquired Business, (ii) grant of any severance or
termination pay to any director, officer or employee of Micron engaged primarily
in the operations of the Acquired Business or (iii) change in compensation or
other benefits payable to any director, officer or employee of Micron engaged
primarily in the operations of the Acquired Business pursuant to any severance
or retirement plans or policies thereof, in each case other than in the ordinary
course of business consistent with past practices.
(D) any transaction by Micron relating solely to material assets or
business of the Acquired Business except in the ordinary course of business as
conducted as of January 31, 1999 and consistent with past practices;
(E) any destruction of, damage to or loss of any assets material to Micron
relating to the Acquired Business taken as a whole (whether or not covered by
insurance);
(F) any material revaluation by Micron of any material assets of the
Acquired Business;
(G) any amendment or termination of any material contract, agreement or
license relating solely to material assets or business of the Acquired Business
to which Micron is a party or by which it is bound except for amendments in the
ordinary course of business that are not reasonably likely to have a Material
Adverse Effect or scheduled expiration pursuant to the terms of the contract,
agreement or license and not as a result of any breach;
(H) any loan by Micron relating to material assets or business of the
Acquired Business to any person or entity, or incurring by Micron of any
indebtedness (except for indebtedness incurred in the ordinary course under
existing credit lines or arrangements set forth in Micron Disclosure Schedule)
relating solely to material assets or business of the Acquired Business;
(I) any waiver or release of any material right or claim of Micron relating
solely to material assets or business of the Acquired Business, including any
write-off or other compromise of any account receivable of Micron relating
solely to material assets or business of the Acquired Business, other than in
the ordinary course of business and consistent with past practices;
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(J) any agreement by Micron to do any of the things described in the
preceding clauses (a) through (i) (other than this Agreement).
SECTION V.7. Material Contracts
Except for the contracts disclosed in Schedule 5.7 to the Micron Disclosure
Schedule, with respect to the Acquired Business primarily or solely (and not
with respect to any other business of Micron generally), Micron is not a party
to or bound by:
(A) any partnership, joint venture or other similar agreement or
arrangement;
(B) any agreement relating to the acquisition or disposition of any
business (whether by merger, sale of stock, sale of assets or otherwise); or
(C) any agreement that limits the freedom of Micron, with respect to the
Acquired Business only, to compete in any line of business or with any Person or
in any area.
(D) any agreement, contract or commitment relating to capital expenditures
and involving future obligations in excess of $25,000 and not cancelable without
penalty;
(E) any mortgages, indentures, loans or credit agreements, security
agreements relating to a material amount of assets or other agreements or
instruments relating to the borrowing of money or extension of credit;
(F) any other agreement, contract, commitment or lease which requires
annual payments by Micron under any such agreement, contract, commitment or
lease of $25,000 or more in the aggregate and is not cancelable without penalty
within thirty (30) days;
(G) any consulting arrangements and contracts for professional, advisory
and other services involving payments of more than $25,000 in any year,
including contracts under which Micron performs services for others;
(H) any other material contracts made other than in the usual or ordinary
course of business of Micron to which Micron is a party or under which Micron or
any of its Subsidiaries is obligated.
Except as disclosed on Schedule 5.7 to the Micron Disclosure Schedule, Micron
has not breached, violated or defaulted under, or received notice that it has
breached, violated or defaulted under, any of the terms or conditions of any of
the agreements, contracts or commitments to which Micron is a
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party or by which it is bound of the type described in clauses (a) through (h)
above in such a manner as would permit any other party to cancel or terminate
any Assumed Contract, or would permit any other party to seek damages, in either
case, which is reasonably likely to have a Material Adverse Effect.
SECTION V.8. Licenses and Permits
Schedule 5.8 to the Micron Disclosure Schedule correctly describes each
governmental license, franchise, permit, certificate, approval or other similar
authorization of Micron, other than as contemplated by the Patent Cross License
Agreement, that is necessary to operate the Acquired Business as it is currently
operated, except those that the absence of which would not reasonably be likely
to have a Material Adverse Effect (the "Permits") together with the name of the
government agency or entity issuing such Permit. Except as set forth on Schedule
5.8 to the Micron Disclosure Schedule, (i) the Permits are valid and in full
force and effect, (ii) Micron is not in default, and no condition exists that
with notice or lapse of time or both would constitute a default, under the
Permits, (iii) none of the Permits will be terminated or impaired or become
terminable, in whole or in part, as a result of the transactions contemplated
hereby and (iv) upon consummation of such transactions, PixTech will acquire all
of the right, title and interest in all the Permits except for those that are
not transferable in accordance with their terms, which are listed on Schedule
5.8 to the Micron Disclosure Schedule and those that are the subject of the
Patent Cross License Agreement.
SECTION V.9.
There is no action, suit, investigation or proceeding pending against, or
to the knowledge of Micron, threatened against or affecting, Micron relating to
the Acquired Business or any of Micron's properties relating to the Acquired
Business, before any court or arbitrator or any governmental body, agency or
official which is reasonably likely to have a Material Adverse Effect or which
in any manner challenges or seeks to prevent, enjoin, alter or materially delay
the transactions contemplated by this Agreement.
SECTION V.10. Properties
(A) Micron has good title to all material property and assets included in
the Acquired Assets.
(B) Schedule 5.10(b) to the Micron Disclosure Schedule lists all facts
presently known to Micron that may affect the operation of the Acquired Assets.
PixTech acknowledges that PixTech is acquiring the Acquired Assets AS IS, and
that MICRON MAKES NO EXPRESS OR IMPLIED WARRANTIES OF ANY KIND OR AS TO ANY
MATTER, INCLUDING AS TO THE MERCHANTABILITY OF ANY OF THE ACQUIRED ASSETS OR
THEIR FITNESS FOR A PARTICULAR PURPOSE.
(C) None of such property or assets is subject to any Lien, except:
(I) Liens disclosed on Schedule 5.10(c) to the Micron Disclosure
Schedule;
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(II) Liens for taxes, assessments and similar charges that are not yet
due or are being contested in good faith;
(III) mechanic's, materialman's and similar charges that are not yet
due or are being contested in good faith;
(IV) Liens arising or incurred in the ordinary course of business; or
(V) other Liens which do not materially interfere with the present use
of, or materially detract from the value of, any property or assets that
are material to the Acquired Business (paragraphs (i)-(iv) of this Section
5.10 are, collectively, the "Permitted Liens").
SECTION V.11. Environmental Matters
Except as set forth on Schedule 5.11 to the Micron Disclosure Schedule and
except for matters that would not reasonably be expected to have a Material
Adverse Effect, to the knowledge of Micron, with respect to the Acquired
Business:
(A) The Acquired Business has not violated, and is not in violation of, any
applicable Environmental Law and no notice, request for information, order,
complaint or penalty has been received by Micron, and there are no judicial,
administrative or other actions, suits or proceedings pending or threatened
against Micron which allege a violation of any Environmental Law with respect to
the Acquired Business;
(B) Micron has obtained or caused to be obtained all environmental permits
necessary for the operation of the Acquired Assets to comply with all applicable
Environmental Laws and Micron is in compliance with the terms of such permits
and other applicable Environmental Laws;
(C) Neither Micron nor the Acquired Business has unlawfully discharged,
disposed of or released, as those terms are defined in any Environmental Law,
any Hazardous Substance on the Acquired Assets, or on any property now or
previously owned, leased or used by the Acquired Business (including, without
limitation, soils, surface and ground water, air, sewer systems and buildings)
except for such discharge, disposal or release as would not have a material
adverse effect on the Acquired Business; and
(D) There are no underground storage tanks for Hazardous Substances, active
or abandoned, present at the Acquired Assets, or at any property now or
previously owned, leased or used by the Acquired Business, and Micron has not
received any written notice of the presence of any such tanks, to the extent
that any removal or remediation associated therewith would have a material
adverse effect on such property.
SECTION V.12. Purchase for Investment
Micron is acquiring the Shares and the PixTech Warrant for investment for
its own account and not with a view to, or for sale in connection with, any
distribution thereof.
SECTION V.13. Accredited Investor
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Micron is an "accredited investor" as that term is defined in Rule
501(a)(8) of Regulation D as promulgated by the SEC under the Securities Act.
SECTION V.14. Exempt from Registration; Restricted Securities
Micron understands that the sale of the Shares and the PixTech Warrant, and
the shares of PixTech Common Stock issuable upon exercise of the PixTech
Warrant, will not be registered under the Securities Act on the basis that the
sale provided for in this Agreement is exempt from registration under of the
Securities Act, and that the reliance of PixTech on such exemption is predicated
in part on Micron's representations set forth in this Agreement. Micron
understands that the Shares and the PixTech Warrant, and the shares of PixTech
Common Stock issuable upon exercise of the PixTech Warrant, are restricted
securities within the meaning of Rule 144 under the Act, and must be held
indefinitely unless they are subsequently registered under the Securities Act or
an exemption from such registration is available.
SECTION V.15. Legends
Micron agrees that the Shares and the PixTech Warrant, and the shares
of PixTech Common Stock issuable upon exercise of the PixTech Warrant, will bear
legends and be subject to the restrictions on transfer as provided in the
Stockholder Rights Agreement. In addition, Micron agrees that PixTech may place
stop transfer orders with its transfer agents with respect to such instruments.
The appropriate portion of the legend shall be removed in accordance with the
provisions of the Stockholder Rights Agreement and the stop transfer orders
shall be removed promptly upon delivery to PixTech of such satisfactory evidence
as reasonably may be required by PixTech that such stop orders are not required
to ensure compliance with the Securities Act.
SECTION V.16. Employees
Schedule 5.16 to the Micron Disclosure Schedule sets forth, solely with
respect to the employees listed on Schedule 9.5 to the PixTech Disclosure
Schedule, each such employee's title, years of service, current annual
compensation, accrued and unpaid compensation, vacation and other amounts owed
to such employee and the number and type of stock options held by each such
employee (including the exercise price, vesting schedule and expiration date of
each such option).
ARTICLE VI
REPRESENTATIONS AND WARRANTIES OF PIXTECH
Except as disclosed in the disclosure schedule (the "PixTech Disclosure
Schedule") dated the date hereof and delivered by PixTech to Micron in
connection with this Agreement, PixTech represents and warrants to Micron that:
SECTION VI.1. Corporate Existence and Power . PixTech is a corporation duly
incorporated, validly existing and in good standing under the laws of Delaware
and has all corporate powers and all governmental licenses, authorizations,
permits, consents and approvals required to carry on its business as now
conducted except those that the absence of which would not have a Material
Adverse Effect and is duly qualified to do business as a foreign corporation and
is in good standing in each jurisdiction where such qualification is necessary,
except for those jurisdictions where the failure to be so qualified would not,
individually or in the aggregate, have a Material Adverse Effect.
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SECTION VI.2. Corporate
PixTech has the requisite corporate power and authority to enter into this
Agreement and the other Transaction Agreements to which it is a party and to
perform its obligations hereunder and thereunder. Except as listed in Schedule
6.2 to the PixTech Disclosure Schedule, the execution and delivery of this
Agreement and the other Transaction Agreements to which it is a party, and
performance by PixTech of its obligations hereunder and thereunder, have been
duly authorized by all necessary corporate action on the part of PixTech. This
Agreement constitutes, and the Ancillary Agreements to which it is a party, when
executed and delivered by PixTech, will constitute, valid and legally binding
obligations of PixTech, enforceable against the PixTech in accordance with their
respective terms, except (i) as may be limited by (x) applicable bankruptcy,
insolvency, reorganization or others laws of general application relating to or
affecting the enforcement of creditors' rights generally and (y) the effect of
rules of law governing the availability of equitable remedies and (ii) as rights
to indemnity or contribution may be limited under federal or state securities
laws or by principles of public policy thereunder.
SECTION VI.3. Governmental Authorization
No consent, approval, order or authorization of, or registration
qualification, designation, declaration or filing with, any federal, state or
local governmental authority on the part of PixTech is required in connection
with the consummation of the transactions contemplated by this Agreement,
except: (i) compliance with any applicable requirements of the HSR Act; (ii)
compliance with any applicable requirements of the 1934 Act; and (iii) the
filing of such qualifications or filings under the Securities Act and the
regulations thereunder and all applicable state securities laws as may be
required in connection with the transactions contemplated by this Agreement,
including in connection with the issuance of the Shares and the PixTech Warrant,
and the PixTech Stockholder Approval. All such qualifications and filings will
have been made or be effective on the Closing.
SECTION VI.4. Noncontravention
The execution, delivery and performance by PixTech of each Transaction
Agreement to which it is a party and the consummation of the transactions
contemplated thereby do not and will not (i) assuming receipt of the PixTech
Stockholder Approval, violate the Restated Certificate of Incorporation or
Bylaws of PixTech, (ii) assuming compliance with the governmental matters
referred to in Section 6.3, violate in any material respect any applicable law,
rule, regulation, judgment, injunction, order or decree, (iii) constitute a
default under, or give rise to any right of termination, cancellation or
acceleration of any right or obligation of PixTech or to a loss of any benefit
to which PixTech is entitled under any provision of any material agreement or
other instrument binding upon PixTech, or (iv) result in the creation or
imposition of any Lien on any the assets of PixTech, except, in the case of
clauses (ii) and (iii), individually and in the aggregate, as would not have a
Material Adverse Effect.
SECTION VI.5. Required Consents
Schedule 6.5 to the PixTech Disclosure Schedule sets forth each material
agreement or other instrument binding upon PixTech requiring a consent or other
action by any Person (the "PixTech Required Consents") as a result of the
execution, delivery and performance of this Agreement, except such consents or
actions as would not, individually or in the aggregate, have a Material
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Adverse Effect if not received or taken by the Closing. The PixTech Required
Consents include the affirmative vote of a majority of the holders of PixTech
Common Stock for (a) the increase of the Authorized Shares of Common Stock of
PixTech as set forth in PixTech's Restated Certificate of Incorporation, (b) an
increase in the number of shares authorized and reserved for issuance pursuant
to PixTech's 1993 Stock Option Plan and (c) the issuance of the PixTech Common
Stock to Micron as contemplated by this Agreement (collectively, the "PixTech
Stockholder Approval"). PixTech has, prior to the date of this Agreement,
provided Micron with a copy of the amendment to PixTech's Restated Certificate
of Incorporation that will be the subject of the PixTech Stockholder Approval.
SECTION VI.6. SEC Filings
(A) Reports. PixTech has furnished or made available to Micron prior to the
date hereof copies of its Annual Report on Form 10-K for the fiscal year ended
December 31, 1998 (the "PixTech Form 10-K"), its Quarterly Reports on Form 10-Q
for the fiscal quarters ended March 31, 1998, June 30, 1998 and September 30,
1998 (the "PixTech Form 10-Q's") and its Annual Report on Form 10-K for the
fiscal year ended December 31, 1997 (the "PixTech 1997 Form 10-K"), and all
other registration statements, reports and proxy statements filed by PixTech
with the SEC on or after December 31, 1998 (the PixTech Form 10-K, the PixTech
Form 10-Q's, the PixTech 1997 Form 10-K and such registration statements,
reports and proxy statements are collectively referred to herein as the "PixTech
SEC Documents"). Each of the PixTech SEC Documents, as of the respective date
thereof (or if amended or superseded by a filing prior to the closing date of
this Agreement, then on the date of such filing), did not, and each of the
registration statements, reports and proxy statements filed by PixTech with the
SEC after the date hereof and prior to the Closing will not, as of the date
thereof (or if amended or superseded by a filing prior to the date of this
Agreement, then on the date of such filing), contain any untrue statement of a
material fact or omit to state a material fact necessary in order to make the
statements made therein, in light of the circumstances under which they were
made, not misleading. PixTech is not a party to any material contract, agreement
or other arrangement which was required to have been filed as an exhibit to the
PixTech SEC Documents that was not so filed.
(B) Financial Statements. The SEC Documents include PixTech's audited
financial statements for the fiscal year ended December 31, 1998 (the "PixTech
Balance Sheet Date"). Since the PixTech Balance Sheet Date, PixTech has duly
filed with the SEC all registration statements, reports and proxy statements
required to be filed by it under the Exchange Act and the Securities Act. The
audited and unaudited consolidated financial statements of PixTech included in
the SEC Documents filed prior to the date hereof fairly present, in conformity
with generally accepted accounting principles ("GAAP") (except as permitted by
Form 10-Q) applied on a consistent basis (except as may be indicated in such
financial statements or the notes thereto), the consolidated financial position
of PixTech and its consolidated Subsidiaries as at the dates thereof and the
consolidated results of their operations and cash flows for the periods then
ended (subject to normal year-end audit adjustments in the case of unaudited
interim financial statements).
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(C) Absence of Certain Changes Since PixTech Balance Sheet. Since the
PixTech Balance Sheet Date, except as disclosed in or contemplated by the
PixTech SEC Documents, the business and operations of PixTech have been
conducted in the ordinary course consistent with past practice, and there has
not been:
(I) any declaration, setting aside or payment of any dividend or other
distribution of the assets of PixTech with respect to any shares of capital
stock of PixTech or any repurchase, redemption or other acquisition by
PixTech or any Subsidiary of PixTech of any outstanding shares of PixTech
capital stock;
(II) any damage, destruction or loss, whether or not covered by
insurance, except for such occurrences that have not resulted, and are not
expected to result, in a Material Adverse Effect;
(III) any waiver by PixTech of a valuable right or of a material debt
owed to it, except for such waivers that have not resulted and are not
expected to result, in a Material Adverse Effect;
(IV) any material change or amendment to, or any waiver of any
material rights under a material contract or arrangement by which PixTech
or any of its assets or properties is bound or subject, except for changes,
amendments or waivers that are expressly provided for or disclosed in this
Agreement or that have not resulted, and are not expected to result, in a
Material Adverse Effect;
(V) any change by PixTech in its accounting principles, methods or
practices or in the manner it keeps its accounting books and records,
except any such change required by a change in GAAP; and
(VI) any other event or condition of any character, except for such
events and conditions that have not resulted, either individually or
collectively, in a Material Adverse Effect.
(D) S-3 Eligibility. PixTech meets the eligibility requirements set forth
in paragraph I of the General Instructions to Form S-3 for the use of such Form
for the registration of securities in a transaction involving secondary
offerings, as described in such General Instructions.
SECTION VI.7. Capitalization
The authorized and outstanding capital stock of PixTech as of the date
hereof, without giving effect to the transactions contemplated by this
Agreement, the authorized capital stock of PixTech consists of (a) 30,000,000
shares of common stock, $0.01 par value per share, of which 15,150,329 shares
were validly issued and outstanding, fully paid and non-assessable as of Xxxxx
0, 0000, (x) 500,000 shares of Series E Preferred Stock, $0.01 par value per
share, of which 367,269 shares are validly issued and outstanding, fully paid
and non-assessable, and (c) 500,000 shares of undesignated preferred stock,
$0.01 par value per share, none of which are issued and outstanding. All
outstanding shares of capital stock have been duly authorized, and all such
issued and outstanding shares have been validly issued and are fully paid and
nonassessable. Schedule 6.7 to the PixTech Disclosure Schedule or the PixTech
SEC Documents include information regarding equity
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securities reserved for issuance to officers, directors, employees or
independent contractors or affiliates of PixTech under PixTech's employee stock
option and purchase plans and upon conversion of convertible securities. Except
as set forth in Schedule 6.7 to the PixTech Disclosure Schedule or the PixTech
SEC Documents, there are no other equity securities, options, warrants, calls,
rights, commitments or agreements of any character to which PixTech is a party
or by which it is bound obligating PixTech to issue, deliver, sell, repurchase
or redeem, or cause to be issued, delivered, sold, repurchased or redeemed, any
shares of the capital stock of PixTech or obligating PixTech to grant, extend or
enter into any such equity security, option, warrant, call, right, commitment or
agreement.
SECTION VI.8. Valid Issuance of Securities
Following receipt of the PixTech Stockholder Approval, the Shares and the
shares of PixTech Common Stock issuable upon exercise of the PixTech Warrant
will be duly authorized and reserved and, when delivered to and paid for by
Micron in accordance with the provisions of this Agreement and (in the case of
the shares of PixTech Common Stock issuable upon exercise of the PixTech
Warrant) the Warrant Agreement, will be validly issued, fully paid and
non-assessable.
SECTION VI.9. Compliance with Securities Laws
Assuming the accuracy of the representations made by Micron in Section 5
hereof, the Shares and the shares of PixTech Common Stock issuable upon exercise
of the PixTech Warrant will be issued to Micron in compliance with applicable
exemptions from (i) the registration and prospectus delivery requirements of the
Securities Act and (ii) the registration and qualification requirements of all
applicable securities laws of the states of the United States.
SECTION VI.10. Litigation
Except as set forth in Schedule 6.10 to the PixTech Disclosure Schedule,
there is no action, suit, investigation or proceeding pending against, or to the
knowledge of PixTech, threatened against or affecting PixTech before any court
or arbitrator or any governmental body, agency or official which in any manner
challenges or seeks to prevent, enjoin, alter or materially delay the
transactions contemplated by this Agreement.
SECTION VI.11. Finders' Fees
Except as set forth in Schedule 6.11 to the PixTech Disclosure Schedule,
there is no investment banker, broker, finder or other intermediary which has
been retained by or is authorized to act on behalf of PixTech who might be
entitled to any fee or commission from Micron upon consummation of the
transactions contemplated by this Agreement.
SECTION VI.12. Full Disclosure
The information contained in this Agreement, the PixTech Disclosure
Schedule and the PixTech SEC Documents with respect to the business, operations,
results of operations and financial condition of PixTech, and the transactions
contemplated by this Agreement are true and complete in all material respects
and do not omit to state any material fact necessary in order to make the
statements therein, in light of the circumstances under which they were made,
not misleading.
SECTION VI.13. Investment Company Act
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PixTech is not an "investment company" or a company "controlled" by an
"investment company" within the meaning of the Investment Company Act of 1940,
as amended (the "1940 Act"), and PixTech will not be required to register as an
"investment company" as a result of the transactions contemplated herein.
SECTION VI.14. No Investment Advisor Affiliation
PixTech is not an "investment advisor," "affiliated company" or an
"affiliated person" of an "investment advisor" within the meaning of the 1940
Act.
SECTION VI.15. Possession of Intellectual Property
Except as disclosed in reports filed with the SEC pursuant to the Exchange
Act, PixTech owns or possesses, or can acquire on reasonable terms, adequate
patents, patent rights, licenses, inventions, copyrights, know-how (including
trade secrets and other unpatented proprietary or confidential information,
systems or procedures), trademarks, service marks, trade names or other
intellectual property (collectively, the "Intellectual Property") necessary to
carry on the business now operated by PixTech and, except as disclosed in
reports filed with the SEC pursuant to the Exchange Act, PixTech has not
received or is otherwise aware of any infringement of or conflict with asserted
rights of others with respect to any Intellectual Property or of any facts or
circumstances which would render any Intellectual Property invalid or inadequate
to protect the interest of PixTech, and which infringement or conflict (if the
subject of any unfavorable decision, ruling or finding) or invalidity or
inadequacy, singly or in the aggregate, would result in a Material Adverse
Effect.
SECTION VI.16. Possession of Licenses and Permits
PixTech possesses such permits, licenses, consents and other authorizations
(collectively, "Governmental Licenses") issued by the appropriate federal,
state, local or foreign regulatory agencies or bodies necessary to conduct the
business now operated by it; PixTech is in compliance with the terms and
conditions of all such Governmental Licenses, except where the failure to so
comply would not, singly or in the aggregate, have a Material Adverse Effect;
all of the Governmental Licenses are valid and in full force and effect, except
when the invalidity of such Governmental Licenses or the failure of such
governmental Licenses to be in full force and effect would not have a Material
Adverse Effect; and PixTech has not received any notice of proceedings relating
to the revocation or modification of any such Governmental Licenses which,
singly or in the aggregate, if the subject of an unfavorable decision, ruling or
finding, would result in a Material Adverse Effect.
SECTION VI.17. Taxes
PixTech has (a) filed or caused to be filed all Tax Returns which, to the
knowledge of PixTech, are required to be filed by it, and paid all Taxes shown
to be due and payable on said returns or on any Tax assessments made against it
or any property and all other Taxes imposed on it by any governmental authority
in the jurisdictions in which it operates, except for any such Taxes and
assessments (i) the amount of which is not individually or in the aggregate
material to the business or operations of PixTech or (ii) the amount,
applicability or validity of which is currently being contested in good faith by
appropriate proceedings and with respect to which PixTech has established
adequate reserves in accordance with generally accepted accounting principles,
and (b) provided adequate accruals in all material respects in accordance with
GAAP in its financial
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statements for any taxes that have not been paid, whether or not shown on as
being due on any returns.
ARTICLE VII
COVENANTS OF MICRON WITH RESPECT TO ACQUIRED BUSINESS
Micron agrees that:
SECTION VII.1. Conduct of the Acquired Business
From the date hereof until the Closing Date, Micron shall conduct the
Acquired Business in the ordinary course consistent with past practice, (except
to the extent Micron believes it is necessary or prudent to reduce or limit the
scale of the Acquired Business as contemplated by this Agreement) and use
reasonable efforts to preserve intact the Acquired Assets and relationships with
third parties. From the date hereof to the Closing Date, Micron shall consult
with PixTech from time to time concerning any proposed activities that could
reasonably be expected to have a material effect on the Acquired Business.
Without limiting the generality of the foregoing, from the date hereof until the
Closing Date, except as disclosed on Schedule 7.1 to the Micron Disclosure
Schedule, Micron will not, with respect to the Acquired Business:
(A) encumber or license (except pursuant to existing contracts or
commitments), or sell, lease, license or otherwise dispose of, any material
assets or property, in each case except in the ordinary course consistent with
past practice;
(B) enter into any partnership arrangements, joint development agreements
or strategic alliances;
(C) acquire or agree to acquire by merging or consolidating with, or by
purchasing any equity interest in or a material portion of the assets of, or by
any other manner, any business or any corporation, partnership, association or
other business organization or division thereof, or otherwise acquire or agree
to acquire any material amount of operating assets;
(D) incur any indebtedness for borrowed or guarantee any such indebtedness
(or enter any other guarantee, keep-well, capital maintenance or other similar
agreement);
(E) make any individual capital expenditure or commitment, or series of
related capital expenditures or commitments, outside the ordinary course of
business, exceeding $25,000; or
(F) engage in any activities to expand the Small Area Display Business.
SECTION VII.2. Access to Information, Confidentiality
From the date hereof until the Closing Date, subject to the provisions of
the Nondisclosure Agreement dated January 26, 1999 between Micron and PixTech
(the "Nondisclosure Agreement")
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and any other confidentiality, nondisclosure or applicable agreement to which
PixTech is bound, Micron will (i) give PixTech, its counsel, financial advisors,
auditors and other authorized representatives reasonable access to the offices,
properties, books and records of the Acquired Business and to the books and
records of Micron relating to the Acquired Business, (ii) furnish, for the
Acquired Business, to PixTech, its counsel, financial advisors, auditors and
other authorized representatives such financial and operating data and other
information relating to the Acquired Business as such Persons may reasonably
request and (iii) instruct its employees, counsel and financial advisors, to
cooperate with PixTech in its investigation of the Acquired Business. Any
investigation pursuant to this Section shall be conducted in such manner as not
to interfere unreasonably with the conduct of the Acquired Business.
Notwithstanding the foregoing, PixTech shall not have access to confidential
information that relates to Micron as a whole, or to personnel records relating
to the Acquired Business relating to individual performance or evaluation
records except as to those individuals identified on Schedule 9.5 to the PixTech
Disclosure Schedule, medical histories or other information which in Micron's
good faith opinion is sensitive or the disclosure of which could subject Micron
to risk of liability.
SECTION VII.3. Notices of Certain Events Micron shall promptly notify
PixTech of:
(A) any notice or other communication from any Person alleging that the
consent of such Person is or may be required in connection with the transactions
contemplated by this Agreement;
(B) any notice or other communication from any government or regulatory
agency or authority in connection with the transactions contemplated by this
Agreement;
(C) any actions, suits, claims, investigations or proceedings commenced
relating to the Acquired Business that, if pending on the date of this
Agreement, would have been required to have been disclosed pursuant to Section
5.9; and
(D) any written notice or communication received from a material vendor or
supplier that such vendor or supplier will no longer supply goods or services to
Micron relating to the Acquired Business, or from any Transferred Employee that
such employee is terminating his employment with Micron.
SECTION VII.4. Covenant Not to Compete
Micron covenants and agrees that for a period of three (3) years following
the Closing Date, Micron shall not, directly or indirectly, anywhere in the
world (the "Territory") manufacture, fabricate or assemble field emission
displays. Micron agrees that this restriction on competition shall be deemed to
be a series of separate covenants not-to-compete for each year within the
three-year period of non-competition and separate covenants not-to-compete for
each state within the United States and each country in the world. If any court
of competent jurisdiction shall determine the foregoing covenant to be
unenforceable with respect to the term thereof or the scope of the subject
matter or geography covered thereby, then such covenant shall nonetheless be
enforceable by
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such court against such other party or upon such shorter term or within such
lesser scope as may be determined by the court to be reasonable and enforceable.
Notwithstanding the foregoing, Micron may: (i) acquire all or a controlling
interest in, or all or a majority of the assets of, any Person engaged in the
manufacture, fabrication or assembly of field emission displays, provided,
however, that Micron shall use commercially reasonable efforts to promptly
divest itself of or shutdown that portion of the operation of such Person
engaged in the manufacture, fabrication or assembly of field emission displays;
(ii) acquire up to 5% of the outstanding capital stock or other ownership
interest in any Person engaged principally or otherwise in the manufacture,
fabrication or assembly of field emission displays having a class of equity
securities listed on any national or international securities exchange; (iii)
buy field emission displays for its own internal use; and (iv) purchase field
emission displays from another Person and resell such displays so long as Micron
did not assist in the manufacture, fabrication or assembly of the purchased and
resold field emission displays. The mere licensing of patents or other
intellectual property by Micron, without more, shall not be deemed to be
"assistance" in the manufacture, fabrication or assembly of field emission
displays.
SECTION VII.5. Transferred Employees
Micron covenants and agrees that (a) without PixTech's prior consent, it
shall not increase the salary payable to any Transferred Employee prior to the
Closing Date, and (b) as of the Closing Date, the only employees of the Display
Division Business shall be the Transferred Employees. Micron hereby waives,
effective on and after the Closing Date, any breach that would result under any
agreement made by any Transferred Employee in favor of Micron not to compete
with Micron, its business activities or otherwise, solely insofar as such breach
arises by virtue of such Transferred Employee's employment by PixTech after the
Closing Date.
ARTICLE VIII
COVENANTS OF PIXTECH ARTICLE
PixTech agrees that:
SECTION VIII.1. Stockholder Approval
PixTech will prepare and file with the SEC a proxy statement to its
stockholders for the 1999 annual meeting of PixTech's stockholders to be held on
or about April 27, 1999. Such proxy statement shall solicit to the PixTech
Stockholder Approval. Such proxy statement will comply in all material respects
with all applicable requirements of law and the rules and regulations
promulgated thereunder. Prior to filing such proxy statement or any amendment
thereto with the SEC, PixTech will afford Micron reasonable time to review and
comment on those portions of such proxy statement or amendment that describe the
transactions contemplated by this Agreement. Whenever any event occurs that is
required to be set forth in an amendment or supplement to such proxy statement,
PixTech will promptly inform Micron of such occurrence and shall make such
filings with the SEC or other appropriate governmental agencies and mail
appropriate notice to its stockholders. Such proxy statement will include the
recommendation of the Board of Directors of PixTech in favor of the Stockholder
Approval (except that the Board of Directors of PixTech may withdraw, modify or
refrain from making such recommendation to the extent that the Board
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determines, in good faith, after consultation with outside legal counsel, that
compliance with the Board's fiduciary duties under applicable law would require
it to do so).
SECTION VIII.2. Access to Information; Confidentiality
Subject to the provision of the Nondisclosure Agreement, PixTech will, with
respect to the Acquired Business, on and after the Closing Date, afford promptly
to Micron and its agents reasonable access to its properties, books, records,
employees and auditors as may be and to the extent necessary to permit Micron to
determine any matter relating to Micron's rights and obligations under this
Agreement or with respect to the Display Division Business for any period ending
on or before the Closing Date; provided that any such access by Micron shall not
unreasonably interfere with the conduct of the business of PixTech.
SECTION VIII.3. Notices of Certain Events PixTech shall promptly notify
Micron of:
(A) any notice or other communication from any Person alleging that the
consent of such Person is or may be required in connection with the transactions
contemplated by this Agreement;
(B) any notice or other communication from any government or regulatory
agency or authority in connection with the transactions contemplated by this
Agreement; and
(C) any actions, suits, claims, investigations or proceedings commenced
relating to PixTech or the Acquired Business that, if pending on the date of
this Agreement, would have been required to have been disclosed pursuant to
Section 6.10.
(D) any action by the Board of Directors of PixTech to withdraw or modify
its approval of this Agreement or the transactions contemplated hereby, or its
recommendation to the stockholders of PixTech to grant the PixTech Stockholder
Approval.
SECTION VIII.4. Cooperation
PixTech covenants and agrees to cooperate with Micron as Micron may
reasonably request, whether before, on or after the Closing Date, to enable such
DARPA Contracts to be audited by DARPA and "closed out."
ARTICLE IX
COVENANTS OF MICRON AND PIXTECH ARTICLE
Micron and PixTech each agree that:
SECTION IX.1. Commercially Reasonable Efforts; Further Assurances
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Subject to the terms and conditions of this Agreement, Micron and PixTech
will use their commercially reasonable efforts to take, or cause to be taken,
all actions and to do, or cause to be done, all things necessary or desirable
under applicable laws and regulations to consummate the transactions
contemplated by this Agreement. Micron and PixTech agree to execute and deliver
such other documents, certificates, agreements and other writings and to take
such other actions as may be necessary or desirable in order to consummate or
implement expeditiously the transactions contemplated by this Agreement.
SECTION IX.2. Certain Filings
Micron and PixTech shall cooperate with one another (i) in determining
whether any action by or in respect of, or filing with, any governmental body,
agency, official or authority is required, or any actions, consents, approvals
or waivers are required to be obtained from parties to any material contracts,
in connection with the consummation of the transactions contemplated by this
Agreement , including pursuant to the HSR Act and (ii) in taking such actions or
making any such filings, furnishing information required in connection therewith
and seeking timely to obtain any such actions, consents, approvals or waivers.
SECTION IX.3. Public Announcements
The parties agree that the initial press release to be jointly issued by
the parties with respect to the transactions contemplated by this Agreement
shall be substantially and in all material respects in the form heretofore
agreed to by the parties, and shall be released by the parties following the
execution of this Agreement. The parties agree to consult with each other before
issuing any subsequent press release or making any subsequent public statement
with respect to this Agreement or the transactions contemplated hereby.
SECTION IX.4. Required Consents
Each of Micron and PixTech shall use its commercially reasonable efforts to
obtain prior to the Closing the Micron Required Consents and the PixTech
Required Consents, respectively. Prior to the Closing, PixTech shall cooperate
with Micron in connection with Micron's obtaining any Micron Required Consents,
including the consent of the lenders under the Financing Agreements to PixTech's
assumption of liabilities thereunder; and provided, however, that such
cooperation of Micron and PixTech hereunder shall not include any requirement of
Micron or PixTech to expend money, commence any litigation or offer or grant any
accommodation (financial or otherwise) to any third party. Without limiting the
foregoing, with respect to the consents listed in the list of "Miscellaneous
Software Contracts -Transfers Subject to Vendor Consent" set forth in Schedule
5.5 to the Micron Disclosure Schedule, Micron will request that the applicable
vendor consent to the assignment of each such contract. If the applicable vendor
gives its consent unconditionally, then such contract shall be considered an
Assumed Contract. If the applicable vendor gives its consent conditioned upon
the payment of any fee, then Micron shall so notify PixTech, and if PixTech
agrees within 10 days (or such shorter period as the vendor may require) to pay
such fee, then upon payment of such fee, such contract shall be considered an
Assumed Contract. If the applicable vendor does not give its consent, or such
consent is subject to any condition other than the payment of a fee, then such
contract shall not be considered an Assumed Contract.
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SECTION IX.5. Display Division Personnel
(A) Schedule 9.5 to the PixTech Disclosure Schedule identifies
approximately 40 employees of Display Division (the "Transferred Employees") to
be offered employment by PixTech on terms substantially equivalent to the terms
of their employment by Micron, except that each Transferred Employees will
receive a salary from PixTech in an amount at least equal to the amount
specified for such Transferred Employee, as a percentage of such Transferred
Employee's current salary, in such Schedule. Micron agrees that it shall not
offer employment to any Transferred Employee for a period of one year after the
Closing Date. In addition, PixTech will establish a stock option pool in which
the Transferred Employees will receive stock options for a total of
600,000shares of PixTech Common Stock. Schedule 9.5 to the PixTech Disclosure
Schedule also identifies the number of PixTech stock options to be received by
each Transferred Employee from such stock option pool. The exercise price for
the stock options will be the lesser of (i) the PixTech Closing Market Price and
(b) the average closing price for PixTech Common Stock for the five trading days
ending three trading days prior to the date of grant.
(B) Micron shall establish a [] * bonus pool to be allocated among the
Transferred Employees who remain employed by PixTech as of the date which is six
months after the Closing Date. The amount of the bonus to which each Transferred
Employee will be entitled is set forth on Schedule 9.5 to the PixTech Disclosure
Schedule. The scheduled bonus for any Transferred Employee who is not employed
by PixTech at the end of the six month period will not be paid from such bonus
pool, and such amount not paid shall not be used to increase the amount of any
other Transferred Employee's bonus payable from such bonus pool. The bonuses
will be payable by PixTech directly to the Transferred Employees, and Micron
will reimburse PixTech for the aggregate amount of such bonuses paid (not to
exceed []* and to be paid in accordance with Schedule 9.5 to the PixTech
Disclosure Schedule) within 10 business days after Micron receives evidence that
such bonuses were paid.
(C) On the Closing Date, and thereafter while employed by PixTech, each
Transferred Employee shall cease to be covered under Micron's employee benefit
plan and instead shall become covered under PixTech's employee benefit plans.
Micron and PixTech agree that PixTech shall provide or cause to be provided to
each Transferred Employee all notices required to be provided under applicable
law, except to the extent applicable law requires such notice to be provided by
Micron. Micron agrees to use commercially reasonable efforts to assist PixTech
in the transition of the Transferred Employees to coverage under PixTech's
employee benefit plan including, at PixTech's request, allowing PixTech to hold,
on a commercially reasonable basis, employee benefit plan open enrollment
meetings with the Transferred Employees at least thirty (30) days prior to the
Closing Date on Micron's premises.
--------------------------------------------------------------------------------
* Confidential treatment has been requested for this portion of the Agreement.
(D) PixTech shall credit each Transferred Employee with all service with
Micron prior to the Closing Date and with all amounts paid to each such employee
prior to the Closing Date to the extent that service or pay is relevant under
any employee benefit plan of PixTech for purposes of determining eligibility to
participate, vesting and benefit accrual. PixTech shall also provide Transferred
Employees with credit under its medical and
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dental employee benefit plans for deductible and co-payment amounts made by the
Transferred Employees under Micron's employee benefit plans prior to the Closing
Date. Micron agrees to provide deductible and co-payment information with
respect to the Transferred Employees as soon as is practicable following the
Closing Date to effectuate such crediting of deductibles and co-payment amounts.
Micron agrees to provide PixTech with service commencement date and prior
compensation information with respect to each Transferred Employee as soon as
practicable after the date upon which this Agreement is executed.
(E) Commencing on the date of this Agreement, Micron and PixTech agree to
cooperate fully with respect to the employment-related actions which are
necessary or reasonably desirable to accomplish the transactions contemplated
pursuant to this Agreement, including the provision of records and information
as each may reasonably request (including job titles, short and long-term
disability coverage, life insurance coverage, operator certification and
workers' compensation records and information) and the making of all appropriate
filings under the Law.
(F) With respect to Transferred Employees who are required to be furnished
a Form W-2 for the calendar year in which the Closing Date occurs, PixTech and
Micron agree to follow the "standard procedure" set forth in Revenue Procedure
96-60 with respect to discharging their respective income and employment tax
withholding and reporting obligations with respect to such employees.
(G) As promptly as practicable after the Closing Date, Micron shall pay to
the Transferred Employees all salary, overtime and other remuneration earned,
accrued and payable for all periods up to the Closing Date in a manner
consistent with Micron's policies for terminated employees.
SECTION IX.6. Display Division Financing Arrangements
In connection with obtaining the consent of the lenders under the Display
Division Financing Agreements to PixTech's assumption of liabilities thereunder,
PixTech shall use its best efforts to cause Micron to be released from all
liabilities thereunder, including, but not limited to, refinancing the assumed
debt on commercially reasonable terms that are not necessarily comparable to the
terms of the Financing Arrangements. Micron agrees, however, that in the event
that, despite PixTech's best efforts, the lenders under the Financing Agreements
do not agree to Micron's release prior to the Closing, then the Micron Guaranty
shall be offered as credit support for the obligations of PixTech assumed
thereunder. In consideration for the Micron Guaranty, and as support for
PixTech's reimbursement obligations to Micron thereunder, PixTech shall grant in
favor of Micron a security interest in the assets identified in Schedule 9.6,
which security interest shall be evidenced by a security agreement in form and
substance satisfactory to Micron (the "PixTech Security Agreement"), together
with such financing statements and other filings as Micron may request to
perfect such security interest. The Micron Guaranty shall be without a fee for a
period of no longer than (x) six months from the Closing Date in the case of the
Display Division Financing Agreement with BancBoston and (y) ten months from the
Closing Date in the case of the Display Division Financing Agreement with Xxxxxx
(such six month and ten month periods are each, an "Initial Period").
Notwithstanding the foregoing, PixTech shall use its best efforts to cause the
Micron
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Guaranty to be released as soon as possible following the Closing Date. In the
event the Micron Guaranty is not released with respect to the Display Division
Financing Agreement with BancBoston or the Display Division Financing Agreement
with Xxxxxx, as the case may be, within the applicable Initial Period, PixTech
shall pay a non-refundable guaranty fee to Micron, payable in cash in U.S.
dollars, in an amount equal to 8% per annum times the maximum principal amount
guaranteed under the Micron Guaranty as of the last day of such month in respect
of the Display Division Financing Agreement with BancBoston or the Display
Division Financing Agreement with Xxxxxx, as applicable, payable on the first
day of each month (and based on a year of twelve months) in advance until
termination of the Micron Guaranty.
SECTION IX.7. Tax matters
(a) Allocation. The parties hereto agree to allocate the Display Division
Purchase Consideration (plus the all consideration attributable to the portion
of the Assumed Liabilities which are treated as purchase price for federal
income tax purposes) to each Acquired Asset in accordance with the applicable
provisions of Section 1060 of the Code (such election and allocation being
referred to herein as the "Price Allocation"). Without limiting the foregoing,
each party hereto agrees that the PixTech Warrant has the value specified in the
Price Allocation and represents a payment of such amount made as of the Closing
Date. Accordingly, each party hereto shall adopt and utilize such Price
Allocation for purposes of all Tax Returns filed by them and shall not
voluntarily take any position inconsistent with the foregoing in connection with
any examination of any Tax Return, any refund claim, any litigation proceeding
or otherwise. In the event that the foregoing is disputed by any taxing
authority, the party receiving notice of the dispute shall promptly notify the
other parties hereto of such dispute and the parties hereto shall consult with
each other concerning resolution of the dispute. Each party agrees to timely
Internal Revenue Service Form 8594 reflecting the Price Allocation with its
applicable federal Tax Return for the taxable year that includes the Closing
Date.
(b) Tax Returns. Micron shall prepare and file, or cause to be filed, all
Tax Returns for Micron for all periods which include the operations of the
Acquired Business or the ownership of the Acquired Assets for any period ending
on or before the Closing Date. Subject to the last sentence of this Section
9.7(b), Micron will make all payments required with respect to any such Tax
Return. PixTech shall prepare and file, or cause to be filed, all Tax Returns of
PixTech which include the operations of the Acquired Business or the ownership
of the Acquired Assets for all periods as to which Tax Returns are due (without
regard to extensions) after the Closing Date (other than for Taxes with respect
to periods for which the Tax Returns of Micron will include the operations of
the Acquired Business or the ownership of the Acquired Assets pursuant to the
second preceding sentence). PixTech will make all payments required with respect
to any such Tax Return; provided, however, that Micron will reimburse PixTech
concurrently therewith to the extent that any payment PixTech is making relates
to the operations of the Acquired Business or the ownership of the Acquired
Assets for any period ending on or before the Closing Date, or otherwise relates
to any Tax liability which is an Excluded Liability. For purposes of this
Section 9.7(b), in the case of any taxable period commencing on or before the
Closing Date and ending after the Closing Date, the portion of any Tax that
relates to any period on or before the Closing Date shall be (i) in the case of
a Tax that is not based on net income, gross income, sales, premiums or gross
receipts, the total
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amount of such Tax for the taxable period in question multiplied by a fraction,
the numerator of which is the number of days in the portion of such taxable
period ending on or before the Closing Date, and the denominator of which is the
total number of days in such taxable period, and (ii) in the case of a Tax that
is based on any of net income, gross income, sales, premiums or gross receipts,
the Tax that would be due with respect to the portion of such taxable period
ending on or before the Closing Date if such period were a separate taxable
period, except that exemptions, allowances, deductions or credits that are
calculated on an annual basis (such as the deduction for depreciation or capital
allowances) shall be apportioned on a per diem basis. In the event that Micron
shall have properly filed a Tax Return which includes a payment of Tax by Micron
related to the operations of the Acquired Business or the ownership of the
Acquired Assets for any period beginning after the Closing Date for which Micron
cannot receive a refund, PixTech shall reimburse Micron for such Tax (calculated
in the same manner as set forth in the immediately preceding sentence).
(c) Taxes. Micron will be responsible for and make all payments required
with respect to, and will indemnify PixTech from and against, (i) any
liabilities of Micron for unpaid Taxes (with respect to the Acquired Business or
the ownership of the Acquired Assets, or otherwise) for the periods ending on or
prior to the closing Date, including without limitation any Tax for which Micron
is responsible under Section 9.7(b) hereof, and (ii) any liability for any
income, transfer, sales, use, or other similar Taxes arising in connection with
the consummation of the transactions contemplated by this Agreement. The parties
shall cooperate with each other to the extent reasonably requested and legally
permitted to minimize any such Taxes described in clause (ii) of the preceding
sentence.
(d) Cooperation. If Micron files any Tax Return which includes payment of
any Tax for which PixTech is responsible under this Section 9.7, PixTech shall
promptly reimburse Micron for such Taxes when such Tax Return is filed. If
PixTech files any Tax Return which includes payments of any Tax for which Micron
is responsible under this Section 9.7, Micron shall promptly reimburse PixTech
for such Taxes when such Tax Return is filed. PixTech and Micron shall timely
provide to each other all information and documents within their possession (or
their auditors, advisors or affiliates) and signatures and consents necessary
for each party to properly prepare and file the Tax Returns described in this
Section 9.7 or in connection with the determination of any Tax liability or any
audit, examination or proceeding. Each party hereto shall reasonably cooperate
(at their own expense) with the other party to obtain other information or
documents necessary or appropriate to prepare and file Tax Returns or elections
or necessary or appropriate in connection with the determination of any Tax
liability or any audit, examination or proceeding.
ARTICLE X
LICENSED INTELLECTUAL PROPERTY
SECTION X.1. Licensed Intellectual Property
Micron grants to PixTech a perpetual, royalty-free license, including the
right to sublicense its Subsidiaries, to all Non-Patent Intellectual Property
used in the Display Division Business, except that: (a) no license is granted
under Intellectual Property relating to Micron's process technology, equipment
recipes and wafer form probe and test used to manufacture and test
single-crystal silicon-substrate-based FED baseplates; (b) no license is granted
to use the trademark "MICRON" in any
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form or combination; and (c) no license is granted to any Micron-originated or
Micron-owned software, or to any documentation or materials relating thereto.
No license is granted to Micron Non-Patent Intellectual Property, except as
expressly provided herein, and no license is granted, either expressly or by
implication, if PixTech is in possession of, or later learns of or acquires
Micron Intellectual Property which is not within the scope of the license grant
above in the preceding paragraph of this Section. PixTech agrees to return any
such Micron Intellectual Property which is not Licensed Intellectual Property to
Micron, and agrees to take steps, where appropriate, to preserve the
confidentiality of any such information which is not manifestly public
information.
The license granted to PixTech under any Micron patents is governed
exclusively by the Patent License attached as Exhibit A to this Acquisition
Agreement, and the license granted under this Section does not grant any rights
under patents of Micron or under any patents which may issue to Micron in the
future. No sublicense granted under this Section shall be broader than the
license granted herein. Accordingly, no sublicense under this Section may
include or grant any rights, license or authority under any patent of Micron,
either now-issued or later-issued.
ARTICLE XI
CONDITIONS TO CLOSING
SECTION XI.1. Conditions to Obligations of Micron and PixTech
The obligations of Micron and PixTech to consummate the purchase and sale
of the Acquired Assets and the assumption of the Assumed Liabilities, and the
purchase and sale of the Shares and PixTech Warrant, are subject to the
satisfaction or waiver of the following conditions.
(A) any applicable waiting period under the HSR Act relating to the sale of
the Acquired Assets and the issuance of the Shares shall have expired or been
terminated; and
(B) no provision of any applicable law or regulation and no judgement,
injunction, order or decree shall prohibit the consummation of the Closing.
SECTION XI.2. Conditions to Obligations of Micron
The obligation of Micron to consummate the Closing is subject to the
satisfaction of the following further conditions:
(A) the Ancillary Agreements, in form and substance reasonably satisfactory
to Micron, shall have been executed and delivered by the parties thereto (other
than Micron) and shall be in full force and effect;
(B) PixTech shall have obtained the PixTech Stockholder Approval and the
waiver of Sumitomo Corporation as to Section 10.11 of the Credit
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Agreement dated as of July 21, 1997 by and between PixTech and Sumitomo
Corporation, as referenced on Schedule 6.5 to the PixTech Disclosure Schedule;
(C) (i) PixTech shall have performed in all material respects all of its
obligations hereunder required to be performed by it at or prior to the Closing
Date, (ii) the representations and warranties of PixTech contained in this
Agreement and in any certificate or other writing delivered by PixTech pursuant
hereto shall be true in all material respects at and as of the Closing Date, as
if made at and as of such date, except for those representations and warranties
that speak as of a specified date, which shall be true in all material respects
at and as of such date, and (iii) Micron shall have received a certificate
signed by an executive officer of PixTech to the foregoing effect;
(D) the terms of the Micron Guaranty shall be reasonably acceptable to
Micron;
(E) actions by or in respect of or filings with any governmental body,
agency, official or authority required to permit the consummation of the Closing
shall have been taken, made or obtained, except for any such actions or filings
the failure to take, make or obtain would not reasonably be expected to have a
Material Adverse Effect as to Micron;
(F) the offer and sale of the Shares and the PixTech Warrant pursuant to
this Agreement shall be exempt from the registration requirements of the
Securities Act and the registration or qualification requirements of all
applicable state securities laws;
(G) Micron shall have received an opinion on behalf of PixTech, dated as of
the Closing Date, from counsel to PixTech, in form and substance reasonably
satisfactory to Micron;
(H) Micron shall have received a copy of PixTech's Annual Report on Form
10-K for the fiscal year ended December 31, 1998, certified by PixTech as fairly
presenting, in conformity with GAAP applied on a consistent basis (except as may
be indicated in such financial statements or the notes thereto), the
consolidated financial position of PixTech and its consolidated Subsidiaries as
at the date thereof and the consolidated results of their operations and cash
flows for the period then ended;
(I) Micron shall have been afforded an opportunity to review the agreements
to which PixTech is a party referred to in Section 2.8(ii) to the Patent Cross
License Agreement; and
(J) Micron shall have received all documents it may reasonably request
relating to the existence of PixTech and the authority of PixTech to enter into
this Agreement and the Ancillary Agreements, and to perform its obligations
hereunder and thereunder, all in form and substance reasonably satisfactory to
Micron.
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SECTION XI.3. Conditions to Obligations of PixTech
The obligation of PixTech to consummate the Closing is subject to the
satisfaction of the following further conditions:
(A) the Ancillary Agreements, in form and substance reasonably satisfactory
to PixTech, shall have been executed and delivered by the parties thereto (other
than PixTech) and shall be in full force and effect;
(B) the PixTech Required Consents, including the PixTech Stockholder
Approval, shall have been obtained;
(C) (i) Micron shall have performed in all material respects of its
obligations hereunder required to be performed by it on or prior to the Closing
Date, (ii) the representations and warranties of Micron contained in this
Agreement and in any certificate or other writing delivered by Micron pursuant
hereto shall be true at and as of the Closing Date in all material respects, as
if made at and as of such date, except for those representations and warranties
that speak as of a specified date, which shall be true in all material respects
at and as of such date, and (iii) PixTech shall have received a certificate
signed by an officer of Micron to the foregoing effect;
(D) actions by or in respect of or filings with any governmental body,
agency, official or authority required to permit the consummation of the Closing
shall have been taken, made or obtained, except for any such actions or filings
the failure to take, make or obtain would not reasonably be expected to have a
Material Adverse Effect as to PixTech;
(E) PixTech shall have received an opinion on behalf of Micron, dated as of
the Closing Date, from counsel to Micron, in form and substance reasonably
satisfactory to PixTech;
(F) PixTech shall be reasonably satisfied that Micron shall have ceased to
engage in operations relating to the Small Area Display Business;
(G) PixTech shall have received all documents it may reasonably request
relating to (i) the existence of Micron and the authority of Micron to enter
into this Agreement and the Ancillary Agreements, and to perform its obligations
hereunder and thereunder and (ii) the conveyance of the Acquired Assets, all in
form and substance reasonably satisfactory to PixTech.
ARTICLE XII
SURVIVAL; INDEMNIFICATION
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SECTION XII.1. Survival
The representations and warranties of the parties hereto contained in this
Agreement or in any certificate or other writing delivered pursuant hereto or in
connection herewith shall survive the Closing until one year after the Closing
Date, except for (a) any representation or warranty concerning (i) the authority
of either party to execute this Agreement and the Ancillary Agreements, (ii) any
environmental matters, which representations and warranties shall survive
indefinitely, and (b) any representation or warranty concerning tax matters,
which shall survive until the expiration or lapse of the applicable statute of
limitations. Notwithstanding the preceding sentence, any representation or
warranty in respect of which indemnity may be sought under this Agreement shall
survive the time at which it would otherwise terminate pursuant to the preceding
sentence, if notice of the inaccuracy or breach thereof giving rise to such
right of indemnity shall have been given to the party against whom such
indemnity may be sought prior to such time.
SECTION XII.2. Indemnification
(A Micron hereby indemnifies PixTech and its Affiliates against and agrees
to hold each of them harmless from any and all damage, loss, liability and
expense (including, without limitation, reasonable expenses of investigation and
reasonable attorneys' fees and expenses in connection with any action, suit or
proceeding) ("Damages") incurred or suffered by PixTech or any of its Affiliates
arising out of (i) any misrepresentation or breach of warranty made by or
covenant of Micron pursuant to this Agreement, or (ii) any Excluded Liability;
provided that (x) Micron shall not be liable under this Section 12.2 unless the
aggregate amount of Damages with respect to all matters referred to in this
Section 12.2(a) exceeds $100,000 in the aggregate and then only to the extent of
such excess and (y) Micron's maximum liability under this Section 12.2(a) shall
not exceed $7,000,000, and provided further that the limitation set forth in
clauses (x) and (y) shall not apply to Damages in respect of Excluded
Liabilities.
(B PixTech hereby indemnifies Micron and its Affiliates against and agrees
to hold each of them harmless from any and all Damages incurred or suffered by
Micron or any of its Affiliates arising out of (i) any misrepresentation or
breach of warranty made by or covenant of PixTech pursuant to this Agreement or
(ii) any Assumed Liability; provided that (x) PixTech shall not be liable under
this Section 12.2(b) unless the aggregate amount of Damages with respect to all
matters referred to in this Section 12.2 exceeds $100,000 in the aggregate and
then only to the extent of such excess and (y) PixTech's maximum liability under
this Section 12.2(b) shall not exceed $7,000,000, and provided further that the
limitation set forth in clauses (x) and (y) shall not apply to Damages in
respect of Assumed Liabilities.
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SECTION XII.3. Procedures
(A The party seeking indemnification under Section 12.2 (the "Indemnified
Party") agrees to give prompt notice to the party against whom indemnity is
sought (the "Indemnifying Party") of the assertion of any claim, or the
commencement of any suit, action or proceeding ("Claim") in respect of which
indemnity may be sought under such Section and will provide the Indemnifying
Party such information with respect thereto that the Indemnifying Party may
reasonably request. The failure to so notify the Indemnifying Party shall not
relieve the Indemnifying Party of its obligations hereunder, except to the
extent such failure shall have prejudiced the Indemnifying Party.
(B The Indemnifying Party shall be entitled to participate in the defense
of any Claim asserted by any third party ("Third Party Claim") and, subject to
the limitations set forth in this Section, shall be entitled to control and
appoint lead counsel for such defense, in each case at its expense.
(C If the Indemnifying Party shall assume the control of the defense of any
Third Party Claim in accordance with the provisions of this Section 12.3, (i)
the Indemnifying Party shall obtain the prior written consent of the Indemnified
Party (which shall not be unreasonably withheld) before entering into any
settlement of such Third Party Claim, if the settlement does not release the
Indemnified Party from all liabilities and obligations with respect to such
Third Party Claim or the settlement imposes injunctive or other equitable relief
against the Indemnified Party and (ii) the Indemnified Party shall be entitled
to participate in the defense of such Third Party Claim and to employ separate
counsel of its choice for such purpose. The fees and expenses of such separate
counsel shall be paid by the Indemnified Party.
(D Each party shall cooperate, and cause their respective Affiliates to
cooperate, in the defense or prosecution of any Third Party Claim and shall
furnish or cause to be furnished such records, information and testimony, and
attend such conferences, discovery proceedings, hearing, trials or appeals, as
may be reasonably requested in connection therewith.
SECTION XII.4. Calculation of Damages
(A The amount of any Damages payable under Section 12.2 by the Indemnifying
Party shall be reduced by (i) any amounts recovered or recoverable by the
Indemnified Party under applicable insurance policies and (ii) any tax benefit
realized by the Indemnified Party arising from the incurrence or payment of any
such Damages.
(B The Indemnifying Party shall not be liable under Section 12.2 for any
consequential or punitive Damages or Damages for lost profits.
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(C Notwithstanding any other provision of this Agreement to the contrary,
if on the Closing Date the Indemnified Party knows of any information that would
cause on or more of the representations and warranties made by the Indemnifying
Party to be inaccurate as of the date made, the Indemnified Party shall have not
right or remedy after the Closing with respect to such inaccuracy and shall be
deemed to have waived its rights to indemnification in respect thereof.
SECTION XII.5. Assignment of Claims
If the Indemnified Party receives any payment from an Indemnifying Party in
respect of any Damages pursuant to Section 12.2 and the Indemnified Party could
have recovered all or part of such Damages from a third party (a "Potential
Contributor") based on the underlying Claim asserted against the Indemnifying
Party, the Indemnified Party shall assign such of its rights to proceed against
the Potential Contributor as are necessary to permit the Indemnifying Party to
recover from the Potential Contributor the amount of such payment.
SECTION XII.6.
Except as specifically set forth in this Agreement, PixTech waives any
rights and claims PixTech may have against Micron, whether in law or in equity,
relating to the Display Division Business. The rights and claims waived by
PixTech include, without limitation claims for contribution or other rights of
recovery arising out of or relating to any Environmental Law, claims for breach
of contract, breach of representation or warranty, negligent misrepresentation
and all other claims for breach of duty. After the Closing, Section 12.2 will
provide the exclusive remedy for any misrepresentation, breach of warranty,
covenant or other agreement arising out of this Agreement or the transaction
contemplated hereby.
ARTICLE XIII
TERMINATION ARTICLE
SECTION XIII.1. Grounds for Termination
This Agreement maybe terminated at any time prior to the Closing:
(A by mutual written agreement of Micron and PixTech,
(B by either Micron or PixTech if the Closing shall not have been
consummated on or before May 20, 1999;
(C by either Micron or PixTech if PixTech shall not have received the
PixTech Stockholder Approval at a meeting of its stockholders duly convened
therefor or at any adjournment thereof; or
(D by either Micron or PixTech if consummation of the transactions
contemplated hereby would violate any nonappealable final order, decree or
judgment of any court or governmental body having competent jurisdiction; or
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(E by Micron in the event of any action by the Board of Directors of
PixTech to withdraw or modify its approval of this Agreement or the transactions
contemplated hereby, or its recommendation to the stockholders of PixTech to
grant the PixTech Stockholder Approval.
The party desiring to terminate this Agreement pursuant to clauses 13.1
(b), (c), (d) or (e) shall give notice of such termination to the other party.
SECTION XIII.2. Effect of Termination If this Agreement is terminated as
permitted by Section 13.1, such termination shall be without liability of either
party (or any stockholder, director, officer, employee, agent, consultant or
representative of such party) to the other party to this Agreement; provided
that if such termination shall result from the willful (i) failure of either
party to fulfill a condition to the performance of the obligations of the other
party, (ii) failure to perform a covenant of this Agreement or (iii) breach by
either party hereto of any representation or warranty or agreement contained
herein, such party shall be fully liable for any and all Damages incurred or
suffered by the other party as a result of such failure or breach.
ARTICLE XIV
MISCELLANEOUS
SECTION XIV.1. Notices
All notices, requests and other communications to any party hereunder shall
be in writing (including facsimile transmission) and shall be given,
if to Micron, to:
Micron Technology, Inc.
0000 X. Xxxxxxx Xxx
Xxxxx, XX 00000-0000
Attention: General Counsel
Telecopy: (000) 000-0000
Telephone: (000) 000-0000
with a copy to:
Xxxxxx Xxxxxxx Xxxxxxxx & Xxxxxx
000 Xxxx Xxxx Xxxx
Xxxx Xxxx, Xxxxxxxxxx 00000
Attention: Xxxx X. Xxxx, Esq.
Telecopy: 000-000-0000
Telephone: 000-000-0000
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if to PixTech, to:
PixTech, Inc.
Avenue Xxxxxxx Xxxxxx
Xxxx Xxxxxxxxxxxx xx Xxxxxxx
Xxxxxxx 00000 XXXXXX
Attention: President
Telecopy: 011-33-4-47-29-05-09
Telephone: 011-33-4-42-29-10-00
with a copy to:
Xxxxxx & Dodge LLP
Xxx Xxxxxx Xxxxxx
Xxxxxx, XX 00000-0000
Attention: Xxxxxxx Xxxxxx, Esq.
Telecopy: (000) 000-0000
Telephone: (000) 000-0000
All such notices, requests and other communications shall be deemed received on
the date of receipt by the recipient thereof if received prior to 5 p.m. in the
place of receipt and such day is a business day in the place of receipt.
Otherwise, any such notice, request or communication shall be deemed not to have
been received until the next succeeding business day in the place of receipt.
SECTION XIV.2. Amendments and Waivers
(A Any provision of this Agreement may be amended or waived if, but only
if, such amendment or waiver is in writing and is signed, in the case of an
amendment, by each party to this Agreement, or in the case of a waiver, by the
party against whom the waiver is to be effective.
(B No failure or delay by any party in exercising any right, power or
privilege hereunder shall operate as a waiver thereof nor shall any single or
partial exercise thereof preclude any or other further exercise thereof or the
exercise of any other right, power or privilege. The rights and remedies herein
provided shall be cumulative and not exclusive of any rights or remedies
provided by law.
SECTION XIV.3. Expenses
All costs and expenses incurred in connection with this Agreement shall
be paid by the party incurring such cost or expense.
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SECTION XIV.4. Successors and Assigns
The provisions of this Agreement shall be binding upon and inure to the
benefit of the parties hereto and their respective successors and assigns;
provided that no party may assign, delegate or otherwise transfer any of its
rights or obligations under this Agreement without the consent of each other
party hereto.
SECTION XIV.5. Governing LawSECTION XIV.5. Governing Law. This Agreement
shall be governed by and construed in accordance with the law of the State of
Delaware, without regard to the conflicts of law rules of such state.
SECTION XIV.6. Counterparts; Third Party Beneficiaries. This Agreement may
be signed in any number of counterparts, each of which shall be an original,
with the same effect as if the signatures thereto and hereto were upon the same
instrument. This Agreement shall become effective when each party hereto shall
have received a counterpart hereof signed by the other party hereto. No
provision of this Agreement is intended to confer upon any Person other than the
parties hereto any rights or remedies hereunder.
SECTION XIV.7. Entire Agreement This Agreement, together with the Ancillary
Agreements and the Non-Disclosure Agreement, constitute the entire agreement
between the parties with respect to the subject matter of this Agreement and
supersede all prior agreements and understandings, both oral and written,
between the parties with respect to the subject matter of this Agreement, except
for Section 16 of that certain letter of intent between the parties dated
January 22, 1999, which shall survive execution of this Agreement.
SECTION XIV.8. Captions
The captions herein are included for convenience of reference only and
shall be ignored in the construction or interpretation hereof.
SECTION XIV.9. Disclosure Schedules
The parties acknowledge and agree that (i) the Schedules to this Agreement
may include certain items and information solely for informational purposes for
the convenience of the parties and (ii) the disclosure by a party of any matter
in the Schedules shall not be deemed to constitute an acknowledgment by the
other party that the matter is required to be disclosed by the terms of this
Agreement or that the matter is material. If any Schedule discloses an item or
information in such a way as to make its relevance to the disclosure required by
another Schedule readily apparent, the matter shall be deemed to have been
disclosed in such other Schedule, notwithstanding the omission of an appropriate
cross-reference to such other Schedule.
-38-
IN WITNESS WHEREOF, the parties hereto have caused this Acquisition
Agreement to be duly executed by their respective authorized officers as of the
day and year first above written.
MICRON TECHNOLOGY, INC.
By: /s/ Xxxxxx X. Xxxxxxxx
-----------------------------------------
Name: Xxxxxx X. Xxxxxxxx
Title: Chairman & Chief Executive Officer
PIXTECH, INC.
By: /s/ Xxxxxx Xxxxxx
-----------------------------------------
Name: Xxxxxx Xxxxxx
Title: Chairman & Chief Executive Officer
SCHEDULE 1.1-A
ACQUIRED ASSETS
SCHEDULE 1.1-B
ASSUMED CONTRACTS
SCHEDULE 1.1-C
ASSUMED LIABILITIES
SCHEDULE 9.6
SECURED ASSETS
AKT Deposition System
Balzers Deposition System
EXHIBIT A
INVESTOR RIGHTS AGREEMENT
-44-
EXHIBIT B
LEASE AGREEMENT
-45-
EXHIBIT C
PATENT CROSS LICENSE AGREEMENT
EXHIBIT D
PIXTECH WARRANT AGREEMENT
ACQUISITION AGREEMENT
dated as of
March 19, 1999
between
MICRON TECHNOLOGY, INC.
and
PIXTECH, INC.
relating to the purchase and sale
of
Micron's Display Division Business
TABLE OF CONTENTS
Page
ARTICLE I DEFINITIONS.........................................................1
SECTION 1.1. Definitions.............................................1
ARTICLE II PURCHASE AND SALE OF DISPLAY DIVISION BUSINESS.....................7
SECTION 2.1. Purchase and Sale.......................................7
SECTION 2.2. Excluded Assets.........................................7
SECTION 2.3. Assumed Liabilities.....................................7
SECTION 2.4. Excluded Liabilities....................................7
SECTION 2.5. Display Division Purchase Consideration.................7
SECTION 2.6. Assignment of Contracts and Rights......................8
ARTICLE III [INTENTIONALLY LEFT BLANK]........................................8
ARTICLE IV CLOSING............................................................8
SECTION 4.1. Closing.................................................8
ARTICLE V REPRESENTATIONS AND WARRANTIES OF MICRON............................9
SECTION 5.1. Corporate Existence and Power...........................9
SECTION 5.2. Corporate Authorization.................................9
SECTION 5.3. Governmental Authorization.............................10
SECTION 5.4. Noncontravention.......................................10
SECTION 5.5. Required Consents......................................10
SECTION 5.6. Absence of Certain Changes.............................10
SECTION 5.7. Material Contracts.....................................11
SECTION 5.8. Licenses and Permits...................................12
SECTION 5.9. Litigation.............................................13
SECTION 5.10. Properties............................................13
SECTION 5.11. Environmental Matters.................................13
SECTION 5.12. Purchase for Investment...............................14
SECTION 5.13. Accredited Investor...................................14
SECTION 5.14. Exempt from Registration; Restricted Securities.......14
SECTION 5.15. Legends...............................................14
SECTION 5.16. Employees.............................................15
-i-
ARTICLE VI REPRESENTATIONS AND WARRANTIES OF PIXTECH.........................15
SECTION 6.1. Corporate Existence and Power..........................15
SECTION 6.2. Corporate Authorization................................15
SECTION 6.3. Governmental Authorization.............................15
SECTION 6.4. Noncontravention.......................................16
SECTION 6.5. Required Consents......................................16
SECTION 6.6. SEC Filings............................................16
SECTION 6.7. Capitalization.........................................18
SECTION 6.8. Valid Issuance of Securities...........................18
SECTION 6.9. Compliance with Securities Laws........................18
SECTION 6.10. Litigation............................................18
SECTION 6.11. Finders'Fees..........................................19
SECTION 6.12. Full Disclosure.......................................19
SECTION 6.13. Investment Company Act................................19
SECTION 6.14. No Investment Advisor Affiliation.....................19
SECTION 6.15. Possession of Intellectual Property...................19
SECTION 6.16. Possession of Licenses and Permits....................19
SECTION 6.17. Taxes.................................................20
ARTICLE VII COVENANTS OF MICRON WITH RESPECT TO ACQUIRED BUSINESS............20
SECTION 7.1. Conduct of the Acquired Business.......................20
SECTION 7.2. Access to Information, Confidentiality.................21
SECTION 7.3. Notices of Certain Events..............................21
SECTION 7.4. Covenant Not to Compete................................22
SECTION 7.5. Transferred Employees..................................22
ARTICLE VIII COVENANTS OF PIXTECH............................................22
SECTION 8.1. Stockholder Approval...................................22
SECTION 8.2. Access to Information; Confidentiality.................23
SECTION 8.3. Notices of Certain Events..............................23
SECTION 8.4. Cooperation............................................23
ARTICLE IX COVENANTS OF MICRON AND PIXTECH...................................23
SECTION 9.1. Commercially Reasonable Efforts; Further Assurances....24
SECTION 9.2. Certain Filings........................................24
SECTION 9.3. Public Announcements...................................24
SECTION 9.4. Required Consents......................................24
SECTION 9.5. Display Division Personnel.............................25
SECTION 9.6. Display Division Financing Arrangements................26
SECTION 9.7. Tax matters............................................27
-ii-
ARTICLE X LICENSED INTELLECTUAL PROPERTY.....................................28
SECTION 10.1. Licensed Intellectual Property........................28
ARTICLE XI CONDITIONS TO CLOSING.............................................29
SECTION 11.1. Conditions to Obligations of Micron and PixTech.......29
SECTION 11.2. Conditions to Obligations of Micron...................29
SECTION 11.3. Conditions to Obligations of PixTech..................30
ARTICLE XII SURVIVAL; INDEMNIFICATION........................................31
SECTION 12.1. Survival..............................................31
SECTION 12.2. Indemnification.......................................32
SECTION 12.3. Procedures............................................32
SECTION 12.4. Calculation of Damages................................33
SECTION 12.5. Assignment of Claims..................................33
SECTION 12.6. Exclusivity...........................................33
ARTICLE XIII TERMINATION.....................................................34
SECTION 13.1. Grounds for Termination...............................34
SECTION 13.2. Effect of Termination.................................34
ARTICLE XIV MISCELLANEOUS....................................................35
SECTION 14.1. Notices...............................................35
SECTION 14.2. Amendments and Waivers................................36
SECTION 14.3. Expenses..............................................36
SECTION 14.4. Successors and Assigns................................36
SECTION 14.5. Governing Law.........................................36
SECTION 14.6. Counterparts; Third Party Beneficiaries...............36
SECTION 14.7. Entire Agreement......................................36
SECTION 14.8. Captions..............................................37
SECTION 14.9. Disclosure Schedules..................................37
-iii-
TABLE OF CONTENTS
(continued)
Page
----
Schedules and Exhibits
Schedule 1.1-A Acquired Assets
Schedule 1.1-B Assumed Contracts
Schedule 1.1-C Excluded Liabilities
Schedule 9.6 Secured Assets
Exhibit A Intellectual Property License
Exhibit B Investor Rights Agreement
Exhibit C Lease Agreement
Exhibit D PixTech Warrant Agreement
-iv-
Amendment No. 1 to Acquisition Agreement
This Amendment No. 1 to Acquisition Agreement (the "Amendment") is dated as
of April 23, 1999 and amends that certain Acquisition Agreement (the
"Acquisition Agreement") dated as of March 19, 1999 between Micron Technology,
Inc. ("Micron") and PixTech Inc. ("PixTech"). Capitalized terms used but not
defined herein shall have the meaning given them in the Acquisition Agreement.
WHEREAS, Micron and PixTech have entered into the Acquisition Agreement
relating to the acquisition by PixTech of certain assets of Micron's Display
Division.
WHEREAS, Micron and PixTech desire to amend the Acquisition Agreement as
set forth herein.
NOW THEREFORE, for good and valuable consideration, including the
consideration referred to in paragraph 2 below, the sufficiency of which is
hereby acknowledged, the parties hereto agree as follows.
1. Amendments to Acquisition Agreement.
1.1 Section 2.6 of the Acquisition Agreement shall be amended by
deleting the last sentence thereof in its entirety.
1.2 Schedule 1.1-B to the Acquisition Agreement shall be amended by
deleting the contract entitled "DABT63-97-C-0001 executed March 25, 1997"
from such Schedule.
2. The parties hereto acknowledge and agree that as a result of the
foregoing amendments, DARPA Contract No. DABT63-97-C-0001 executed March 25,
1997 (the "Specified Contract") will not be among the Assumed Contracts and
Assumed Liabilities to be acquired by PixTech pursuant to the Acquisition
Agreement, and the Specified Contract shall remain the asset and liability of
Micron. In consideration for deleting the Specified Contract from the Assumed
Contracts and Assumed Liabilities to be acquired by PixTech, PixTech agrees that
it shall cooperate fully with Micron to permit Micron to satisfy all of its
obligations under the Specified Contract. Among other things, PixTech agrees
that (i) Micron shall be entitled to satisfy its obligations under the Specified
Contract with all necessary assistance, whether technological, financial or
otherwise, from PixTech, at no expense to Micron, (ii) if requested by Micron,
PixTech shall cooperate with Micron to obtain an amendment to the Specified
Contract, whether prior to or following the Closing, to provide that Micron may
utilize PixTech's technology and fabrication resources, including its base plate
technology, to manufacture displays required to be delivered by Micron to DARPA
under the Specified Contract, and (iii) if requested by Micron, PixTech shall
deliver to Micron, at no cost to Micron, [] *. Each of the displays referenced
in clause (iii) above shall have sufficient electronics to run video images from
a PixTech-provided video source or sources. Process, design details, and all run
cards and probe/test results of the foregoing displays will be provided to
Micron by PixTech. Micron will have the right to share or use such information,
documents and displays with the U.S. Department of Defense, as it deems
appropriate. Micron, together with representatives of the U.S. Department of
Defense, will be allowed to observe and actively participate in any and all
fabrication and testing steps in connection with the displays, and to discuss
the fabrication and testing of the displays with PixTech technical staff. The
parties further agree that in no event shall any activities by Micron to satisfy
its obligations under the Specified Contract be construed as a violation of
Micron's agreement not to compete set forth in Section 7.4 of the Acquisition
Agreement, and the provisions of such Section 7.4 shall be suspended for such
purpose.
3. Counterparts. This Amendment may be executed in several counterparts,
each of which shall be deemed an original, but all of which together shall
constitute one and the same instrument.
IN WITNESS WHEREOF, the parties hereto have caused this Amendment to be
duly executed by their authorized officers as of the day and year first above
written.
MICRON TECHNOLOGY, INC.
By: /s/ Xxxxxx X. Xxxxxxxx
-----------------------------------------
Name: Xxxxxx X. Xxxxxxxx
Title: Chairman & Chief Executive Officer
PIXTECH, INC.
By: /s/ Xxxxxx Xxxxxx
-----------------------------------------
Name: Xxxxxx Xxxxxx
Title: Chairman & Chief Executive Officer
* Confidential treatment has been requested for this protion of the agreement.
