EXHIBIT 2.3
ASSET PURCHASE AGREEMENT
dated as of June 28, 2003,
among ALFA-PRO PRODUCTS GMBH, a German corporation ("SELLER"),
ADVANCED TECHNOLOGY INDUSTRIES, INC., a Delaware corporation ("PURCHASER")
and XXXXX XXXXXXXX ("SCHLATTL").
WHEREAS, Seller desires to sell to Purchaser, and Purchaser
desires to purchase from Seller, the Acquired Intellectual Property (as defined
in Section 1.02), upon the terms and subject to the conditions of this
Agreement;
WHEREAS, Schlattl owns all of the outstanding equity interest
of Seller;
WHEREAS, Schlattl has loaned funds (the "CETONI INDEBTEDNESS")
to Cetoni Umwelttechnologie Entwicklungs GmbH, a subsidiary of Purchaser
("CETONI"), to pay for operating expenses incurred by Cetoni;
WHEREAS, Purchaser is a party to the Agreement and Plan of
Merger dated as of June 18, 2003 (the "MERGER AGREEMENT") among Purchaser, LTDN
Acquisition Corp. and LTDnetwork, Inc.; and
WHEREAS, it is the intent of the parties for the Closing (as
defined in Section 2.01) to occur immediately prior to the consummation of the
Merger (as defined in the Merger Agreement).
NOW, THEREFORE, in consideration of the foregoing and the
representations, warranties and covenants herein contained, the parties hereto,
intending to be legally bound, hereby agree as follows:
ARTICLE I.
PURCHASE AND SALE OF ACQUIRED INTELLECTUAL PROPERTY
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SECTION 1.01. PURCHASE AND SALE. On the terms and subject to
the conditions of this Agreement, at the Closing (as defined in Section 2.01),
Seller shall sell, assign, transfer, convey and deliver to Purchaser, and
Purchaser shall purchase from Seller all the right, title and interest of Seller
in, to and under the Acquired Intellectual Property in consideration for (a)
20,000,000 shares (the "SHARES") of common stock, $0.0001 par value, of Parent
("PURCHASER COMMON STOCK") and (b) an amount not to exceed $90,000 in cash and
equal to the loan amount by Schattl to the Seller as evidenced in the books of
the Seller (the "CASH CONSIDERATION"). Seller hereby directs Purchaser to issue
the Shares and to pay the Cash Consideration directly to Schlattl, Seller's sole
stockholder, on behalf of Seller. The purchase and sale of the Acquired
Intellectual Property is referred to in this Agreement as the "ACQUISITION".
SECTION 1.02. ACQUIRED INTELLECTUAL PROPERTY. (a) The term
"ACQUIRED INTELLECTUAL PROPERTY" means the following:
(i) all patents (including all reissues, divisions,
continuations and extensions thereof), patent applications, patent
rights, trademarks, trademark registrations, trademark applications,
servicemarks, trade names, business names, brand names, internet domain
names, copyrights, copyright registrations, designs, design
registrations, and all rights to any of the foregoing ("INTELLECTUAL
PROPERTY") of Seller, including the Intellectual Property set forth on
Schedule 1.02(a); and
(ii) all trade secrets, confidential information, inventions,
know-how, formulae, processes, procedures, research records, records of
inventions, test information, market surveys and marketing know-how of
Seller (the "TECHNOLOGY").
(b) Purchaser shall acquire the Acquired Intellectual Property
free and clear of all liabilities, obligations and commitments of Seller and
free and clear of all Liens (as defined in Section 3.04).
SECTION 1.03. REPAYMENT OF DEBT. Purchaser and Schlattl agree
that on the Closing Date the Cetoni Indebtedness shall not exceed $42,200 (the
"CETONI INDEBTEDNESS AMOUNT"). On the terms and subject to the conditions of
this Agreement, at the Closing, Purchaser shall, on behalf of Cetoni, pay to
Schlattl, in cash, an amount equal to the Cetoni Indebtedness Amount in full
satisfaction of the Cetoni Indebtedness. Schlattl hereby agrees that upon
receipt of the Cetoni Indebtedness Amount, all obligations and liabilities of
Cetoni in respect of the Cetoni Indebtedness and any other liabilities owed to
Schlattl by Purchaser or any of its subsidiaries shall be fully extinguished and
satisfied, including, but not limited to, any payments of principal, accrued and
unpaid interest, premiums and penalties.
ARTICLE II.
THE CLOSING
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SECTION 2.01. CLOSING DATE. The closing of the Acquisition
(the "CLOSING") shall take place at Passau, Germany immediately prior to the
consummation of the Merger, or at such other place, time and date as shall be
agreed between Seller and Purchaser. The date on which the Closing occurs is
referred to in this Agreement as the "CLOSING DATE".
SECTION 2.02. TRANSACTIONS TO BE EFFECTED AT THE CLOSING. At
the Closing:
(a) Seller shall deliver to Purchaser:
(i) an executed copy of an Intellectual Property Assignment in
the form attached hereto as Exhibit A;
(ii) written releases and waivers or other evidences
satisfactory to Purchaser that all Liens imposed on the Acquired
Intellectual Property have been removed;
(iii) certificates evidencing the valid existence of Seller
and evidence of the authority of Seller to execute and perform this
Agreement and the Intellectual Property Assignment; and
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(iv) such other documents as Purchaser may reasonably request
to demonstrate satisfaction of the conditions and compliance with the
covenants set forth in this Agreement.
(b) Purchaser shall deliver to Schlattl (as directed by Seller
in Section 1.01 in the case of the Shares and the Cash Consideration) (i) by
wire transfer, to a bank account designated in writing by Schlattl in writing at
least ten days prior to the Closing Date, immediately available funds equal to
the sum of (x) the Cash Consideration and (y) the Cetoni Indebtedness Amount and
(ii) certificates in definitive form registered in the name of Schlattl,
evidencing the Shares. Each certificate representing the Shares and any other
securities issued in respect of the Shares upon any stock split, stock dividend,
recapitalization, merger, consolidation or similar event, shall (unless
otherwise permitted or unless the shares of Purchaser Common Stock evidenced by
such certificate shall have been registered under the Securities Act (as
hereinafter defined)) be stamped or otherwise imprinted with a legend
substantially in the following form (in addition to any legend required under
applicable state securities laws):
"THE SHARES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN REGISTERED
UNDER THE SECURITIES ACT OF 1933 OR ANY STATE SECURITIES LAWS. THESE
SHARES MAY NOT BE SOLD OR OFFERED FOR SALE IN THE ABSENCE OF SUCH
REGISTRATION OR UNLESS SUCH TRANSACTION IS EXEMPT FROM, OR NOT SUBJECT
TO, SUCH REGISTRATION."
ARTICLE III.
REPRESENTATIONS AND WARRANTIES OF SELLER AND SCHLATTL
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Seller and Schlattl hereby jointly and severally represent and
warrant to Purchaser, as of the date of this Agreement and as of the Closing
Date, as follows:
SECTION 3.01. ORGANIZATION STANDING AND POWER. Seller is duly
organized, validly existing and in good standing under the laws of Germany and
has full power and authority and possesses all governmental franchises,
licenses, permits, authorizations and approvals necessary to enable it to own,
lease or otherwise hold its properties and assets and to conduct its businesses
as presently conducted.
SECTION 3.02. AUTHORITY; EXECUTION AND DELIVERY;
ENFORCEABILITY. Seller has full power and authority to execute the Intellectual
Property Assignment and each of Seller and Schlattl has full power and authority
to execute this Agreement and to consummate the Acquisition and the other
transactions contemplated hereby. The execution and delivery by Seller of the
Intellectual Property Assignment and the execution and delivery by each of
Seller and Schlattl of this Agreement and the consummation by each of Seller and
Schlattl of the Acquisition and the other transactions contemplated hereby have
been duly authorized by all necessary action. Each of Seller and Schlattl has
duly executed and delivered this Agreement and prior to the Closing Seller will
have duly executed and delivered the Intellectual Property Assignment, and this
Agreement constitutes, and the Intellectual Property Assignment will after the
Closing constitute, Seller's or Schlattl's, as the case may be, legal, valid and
binding obligation, enforceable against such party in accordance with its terms.
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SECTION 3.03. NO CONFLICTS; CONSENTS. The execution and
delivery by Seller and Schlattl of this Agreement do not, the execution and
delivery by Seller of the Intellectual Property Assignment will not, and the
consummation of the Acquisition and the other transactions contemplated hereby
(including the issuance of the Shares and the payment of the Cash Consideration
directly to Schlattl as directed by Seller) and compliance by Seller and
Schlattl with the terms hereof and compliance by Seller with the terms of the
Intellectual Property Assignment will not conflict with, or result in any
violation of or default (with or without notice or lapse of time, or both)
under, or give rise to a right of termination, cancellation or acceleration of
any obligation or to loss of a benefit under, or to increased, additional,
accelerated or guaranteed rights or entitlements of any person under, or result
in the creation of any Lien upon any of the properties or assets of Seller
under, any provision of (i) the organizational documents of Seller, (ii) any
agreement, contract, instrument or understanding to which Seller or Schlattl is
a party or by which any of their respective properties or assets is bound or
(iii) any judgment, order or decree ("JUDGMENT") or statute, law (including
common law), ordinance, rule or regulation ("APPLICABLE LAW") applicable to
Seller or Schlattl or their respective properties or assets. No consent,
approval, license, permit, order or authorization ("CONSENT") of, or
registration, declaration or filing with, any Federal, state, local or foreign
government or any court of competent jurisdiction, administrative agency or
commission or other governmental authority or instrumentality, domestic or
foreign (a "GOVERNMENTAL ENTITY") is required to be obtained or made by or with
respect to Seller or Schlattl in connection with the execution, delivery and
performance of this Agreement or the Intellectual Property Assignment or the
consummation of the Acquisition or the other transactions contemplated hereby
and thereby.
SECTION 3.04. LIENS. Seller has good and valid title to all
the Acquired Intellectual Property, in each case free and clear of all
mortgages, liens, security interests, charges, easements, leases, subleases,
covenants, rights of way, options, claims, restrictions or encumbrances of any
kind (collectively, "LIENS").
SECTION 3.05. INTELLECTUAL PROPERTY. (a) Schedule 1.02(a) sets
forth a true and complete list of all Intellectual Property owned by Seller.
With respect to all Acquired Intellectual Property that is the subject of an
application, certificate, filing, registration, or other documents issued by,
filed with, or recorded by, any Governmental Entity (the "SELLER REGISTERED
INTELLECTUAL PROPERTY"), Schedule 1.02(a) sets forth a list of all jurisdictions
in which such Seller Registered Intellectual Property has been issued or is
registered or registrations applied for and all registration and application
numbers. Each item of Seller Registered Intellectual is valid and subsisting,
and all necessary registration fees, maintenance fees, renewal fees, annuity
fees and taxes in connection with the Seller Registered Intellectual Property
have been paid and all necessary documents and certificates in connection with
the Seller Registered Intellectual Property have been filed with all relevant
Governmental Entities for purposes of maintaining the Seller Registered
Intellectual Property. Except as set forth in Schedule 3.05, (i) Seller is the
sole and exclusive owner of, and Seller has the right to use, execute,
reproduce, display, perform, modify, enhance, distribute, prepare derivative
works of and sublicense, without payment to any other person, all the Acquired
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Intellectual Property and the consummation of the Acquisition and the other
transactions contemplated hereby does not and will not conflict with, alter or
impair any such rights, and (ii) neither Seller nor Schlattl has received any
written or oral communication from any person asserting any ownership interest
in any Acquired Intellectual Property. To the extent any Acquired Intellectual
Property has been developed or created by any person other than Seller, Seller
has a written agreement with such person with respect thereto and Seller has
obtained ownership of such Intellectual Property by operation of law or by valid
assignment of any such rights.
(b) Except as set forth in Schedule 3.05, Seller has not
granted any license of any kind relating to any Technology or Acquired
Intellectual Property or the marketing or distribution thereof. Schedule 3.05
contains a complete and accurate list of all contracts, agreements, instruments
and understandings relating to the Acquired Intellectual Property. The Seller
Registered Intellectual Property does not violate, conflict with or infringe the
Intellectual Property of any other person and, to the knowledge of Seller, no
other Acquired Intellectual Property violates, conflicts with or infringes the
Intellectual Property of any other person. Except as set forth in Schedule 3.05,
(i) no claims are pending against Seller by any person with respect to the
ownership, validity, enforceability, or effectiveness of any Acquired
Intellectual Property and (ii) Seller and its affiliates have not received any
written or oral communication alleging that Seller or any of its affiliates has
violated any rights relating to Intellectual Property of any person. To the
knowledge of Seller and Schlattl, no person is infringing or misappropriating
any Acquired Intellectual Property.
(c) None of the confidential information or trade secrets of
Seller has been published or disclosed by Seller or any other person. No former
or current members of management or personnel of Seller or any of its
affiliates, including all former and current employees, agents, consultants and
independent contractors who have contributed to or participated in the
conception and development of any Technology have any claim against Seller in
connection with such person's involvement in the conception and development of
any Technology and no such claim has been asserted or is threatened.
SECTION 3.06. CAPITALIZATION. Schlattl is the record and
beneficial owner of all equity interests, and securities convertible or
exchangeable into equity interests, of Seller, free and clear of all Liens.
There are no agreements, contracts, instruments or understandings, relating to
the issuance, sale or transfer of any equity interests, or securities
convertible or exchangeable into equity interests, of Seller. Seller owns no
equity interests in any entity.
SECTION 3.07. RESTRICTED SHARES. (a) Neither Seller nor
Schlattl is (x) a "U.S. Person" as that term is defined in Regulation S
promulgated under the Securities Act of 1933 (as amended, the "SECURITIES ACT")
or (y) acquiring the Shares for the account or benefit of a U.S. Person. Under
Regulation S, with certain exceptions, "U.S. Person" means: (i) any natural
person resident in the U.S.; (ii) any partnership or corporation organized or
incorporated under the laws of the U.S.; (iii) any estate of which any executor
or administrator is a U.S. person; (iv) any trust of which any trustee is a U.S.
person; (v) any agency or branch of a foreign entity located in the U.S.; (vi)
any non-discretionary account or similar account (other than an estate or trust)
held by a dealer or other fiduciary for the benefit or account of a U.S. person;
(vii) any discretionary account or similar account (other than an estate or
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trust) held by a dealer or other fiduciary organized, incorporated, or (if an
individual) resident in the U.S.; and (viii) any partnership or corporation if:
(A) organized or incorporated under the laws of any foreign jurisdiction; and
(B) formed by a U.S. person principally for the purpose of investing in
securities not registered under the Securities Act, unless it is organized or
incorporated and owned by accredited investors (as defined in Rule 501(a) under
the Securities Act) who are not natural persons, estates or trusts.
(b) Each of Seller and Schlattl acknowledges and understands
that the Shares constitute a "restricted security" under the Securities Act and
have not been registered under the Securities Act in reliance upon specific
exemption therefrom, which exemption depends upon, among other things, the bona
fide nature of Seller's representations as expressed herein. Each of Seller and
Schlattl further understands that the Shares must be held indefinitely unless
they are subsequently registered under the Securities Act or an exemption from
such registration is available. Moreover, each of Seller and Schlattl
understands that Purchaser is under no obligation to register the Shares. Each
of Seller and Schlattl understands that the certificate evidencing the Shares
will be imprinted with a legend as described in Section 2.02(b) which prohibits
the transfer of the Shares unless they are registered or such registration is
not required.
(c) Each of Seller and Schlattl acknowledges that such party
has had access to all of the filings of Purchaser filed under Section 13(a) of
the Securities Exchange Act of 1934 (as amended, the "EXCHANGE ACT") with the
Securities and Exchange Commission since December 31, 2001. Each of Seller and
Schlattl has been given the opportunity to ask questions of, and to receive
answers from, Purchaser concerning the terms and conditions of Schlattl's
acquisition of the Shares (as directed, and on behalf of, Seller) and related
matters and to obtain all additional information which each of Seller and
Schlattl deems necessary.
SECTION 3.08. LIABILITIES. As of the Closing Date, Seller will
have no liabilities or obligations (whether accrued, absolute, contingent,
unasserted or otherwise) of any nature. Seller will not be rendered insolvent as
result of the Acquisition and the direction to issue the Shares and pay the Cash
Consideration directly to Schlattl or the Schlattl Transfer (as hereinafter
defined), as the case may be. Seller has not, either voluntarily or
involuntarily, (a) filed or consented to the filing against it of a petition to
take advantage of any insolvency act, (b) made an assignment for the benefit of
its creditors, (c) consented to the appointment of a receiver for itself, (d)
had a petition in bankruptcy filed against it or (e) been adjudged a bankrupt.
ARTICLE IV.
REPRESENTATIONS AND WARRANTIES OF PURCHASER
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Purchaser hereby represents and warrants to Seller and
Schlattl, as of the date of this Agreement and as of the Closing Date, as
follows:
SECTION 4.01. ORGANIZATION, STANDING AND POWER. Purchaser is
duly organized, validly existing and in good standing under the laws of the
State of Delaware and has full corporate power and authority to enable it to
own, lease or otherwise hold its properties and assets and to carry on its
business as presently conducted.
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SECTION 4.02. AUTHORITY; EXECUTION AND DELIVERY; AND
ENFORCEABILITY. Purchaser has full power and authority to execute this Agreement
and to consummate the Acquisition and the other transactions contemplated
hereby. The execution and delivery by Purchaser of this Agreement and the
consummation by Purchaser of the Acquisition and the other transactions
contemplated hereby have been duly authorized by all necessary corporate action.
Purchaser has duly executed and delivered this Agreement and this Agreement
constitutes its legal, valid and binding obligation, enforceable against it in
accordance with its terms.
SECTION 4.03. NO CONFLICTS; CONSENTS. The execution and
delivery by Purchaser of this Agreement do not and the consummation of the
Acquisition and the other transactions contemplated hereby and compliance by
Purchaser with the terms hereof will not conflict with, or result in any
violation of or default (with or without notice or lapse of time, or both)
under, or give rise to a right of termination, cancellation or acceleration of
any obligation or to loss of a material benefit under, any provision of (i) the
certificate of incorporation or by-laws of Purchaser, (ii) any agreement,
contract, instrument or understanding to which Purchaser is a party or by which
any of its properties or assets is bound or (iii) any Judgment or Applicable Law
applicable to Purchaser or its properties or assets. No Consent of or
registration, declaration or filing with any Governmental Entity is required to
be obtained or made by or with respect to Purchaser in connection with the
execution, delivery and performance of this Agreement or the consummation of the
Acquisition or the other transactions contemplated hereby, other than compliance
with and filings under Section 13(a) of the Exchange Act.
SECTION 4.04. SHARES. The Shares, when issued in accordance
with this Agreement, shall be duly authorized, validly issued, fully paid and
nonassessable.
ARTICLE V.
COVENANTS
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SECTION 5.01. COVENANTS OF SELLER AND SCHLATTL. From the date
hereof through the Closing Date:
(a) Except to the extent Purchaser shall otherwise consent in
writing, Seller shall not do, and Schlattl shall not permit Seller to do, any of
the following:
(i) permit, allow or suffer any Acquired Intellectual Property
to become subjected to any Lien of any nature whatsoever;
(ii) sell, lease, license or otherwise dispose of any Acquired
Intellectual Property;
(iii) issue, sell, grant or otherwise dispose of any of its
equity interests or securities convertible or exchangeable for any of
its equity interests;
(iv) alter (through merger, liquidation, reorganization,
restructuring or any other fashion) the corporate structure or
ownership of Seller;
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(v) knowingly or intentionally take any action that results or
is reasonably likely to result in any of the representations and
warranties of Seller hereunder being untrue in any material respect;
(vi) merge or consolidate with any person;
(vii) authorize, recommend, propose or announce an intention
to adopt a plan of complete or partial liquidation or dissolution;
(viii) enter into any agreement, contract or instrument; and
(ix) agree to or make any commitment, whether orally or in
writing, to take any actions prohibited by this Agreement.
(b) Notwithstanding the provisions of Section 5.01(a), Seller
may transfer all, but not less than all, of the Acquired Intellectual Property
to Schlattl (the "SCHLATTL TRANSFER"); PROVIDED that as a condition to the
Schlattl Transfer (i) Purchaser shall be provided with copies of all
documentation evidencing the Schattl Transfer and Schlattl's assumption of
Seller's obligations under this Agreement and Purchaser must be satisfied in
form and substance with all such documentation, (ii) Seller and Schlattl shall
have made, or upon the Schlattl Transfer shall make, all registrations,
declarations or filings with any Governmental Authority that is required (or
requested by Purchaser) to be obtained to effect the Schlattl Transfer and (iii)
the Schlattl Transfer shall not violate any Applicable Law. Schlattl hereby
agrees that if the Schlattl Transfer is consummated, Schlattl shall fully and
unconditionally assume and perform all obligations of Seller under this
Agreement (including the obligation under Section 1.01 to sell the Acquired
Intellectual Property to Purchaser) and all representations and warranties to be
made by Seller as of the Closing shall be made by Schlattl (except with respect
to any such obligations, representations and warranties that relate soley to
Seller as a corporate entity); PROVIDED that Alfa-Pro Products GmbH shall, in
addition to Schlattl as an assignee hereunder, (i) continue to be bound by
Sections 5.02, 5.03, 5.04, 5.05, 5.07, 5.08 and 5.09 and Articles VIII and IX
and (ii) make, as of the Closing Date, the representations and warranties
contained in Sections 3.01, 3.02 (except with respect to the Intellectual
Property Assignment) , 3.03 (except with respect to the Intellectual Property
Assignment), 3.05 (except with respect to the ownership of the Acquired
Intellectual Property) and 3.08 and (iii) provide the certificates contemplated
by Sections 6.02(a) and (b).
(c) Schlattl shall not sell, transfer, pledge or otherwise
dispose of any equity interests, or securities convertible or exchangeable into
equity interests, of Seller owned by Schlattl.
SECTION 5.02. ACCESS TO INFORMATION. Seller shall afford to
Purchaser and its counsel and other representatives reasonable access, during
the period prior to the Closing, to all the books, contracts, and records
relating to the Acquired Intellectual Property, and, during such period shall
furnish promptly to Purchaser any information relating to the Acquired
Intellectual Property as Purchaser may reasonably request.
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SECTION 5.03. REASONABLE EFFORTS. (a) On the terms and subject
to the conditions of this Agreement, each party shall use its reasonable efforts
to cause the Closing to occur, including taking all reasonable actions necessary
to comply promptly with all legal requirements that may be imposed on it or any
of its affiliates with respect to the Closing.
(b) Each party shall, and shall cause its affiliates to, use
its reasonable efforts to obtain, and to cooperate in obtaining, all consents
from third parties necessary or appropriate to permit the transfer of the
Acquired Intellectual Property to Purchaser.
SECTION 5.04. EXPENSES. Whether or not the Closing takes
place, and except as set forth in Article VIII, all costs and expenses incurred
in connection with this Agreement and the Intellectual Property Assignment and
the transactions contemplated hereby and thereby shall be paid by the party
incurring such expense.
SECTION 5.05. BROKERS OR FINDERS. Each of Purchaser and Seller
represent, as to itself and its affiliates, that no agent, broker, investment
banker or other firm or person is or will be entitled to any broker's or
finder's fee or any other commission or similar fee in connection with any of
the transactions contemplated by this Agreement.
SECTION 5.06. SUPPLEMENTAL DISCLOSURE. Seller shall have the
continuing obligation until the Closing promptly to supplement or amend the
Schedules with respect to any matter hereafter arising or discovered that, if
existing or known at the date of this Agreement, would have been required to be
set forth or described in the Schedules; PROVIDED, HOWEVER, that no supplement
or amendment to such Schedules shall have any effect for the purpose of
determining the satisfaction of the conditions set forth in Section 6.02(a) or
for purposes of determining whether any person is entitled to indemnification
pursuant to Article VIII.
SECTION 5.07. PUBLICITY. From the date hereof through the
Closing Date, no public release or announcement concerning the transactions
contemplated hereby shall be issued by Seller or Schlattl without the prior
consent of Purchaser.
SECTION 5.08. FURTHER ASSURANCES. From time to time, as and
when requested by Purchaser, each of Seller and Schlattl shall execute and
deliver, or cause to be executed and delivered, all such documents and
instruments and shall take, or cause to be taken, all such further actions, as
Purchaser may reasonably deem necessary or desirable to consummate the
transactions contemplated by this Agreement, including, executing and delivering
to Purchaser such assignments, consents and other instruments as Purchaser may
reasonably request as necessary or desirable for such purpose.
SECTION 5.09. CONFIDENTIAL INFORMATION. Unless and until this
Agreement is terminated, Seller and Schlattl shall maintain as confidential any
confidential information (including, trade secrets) of Seller relating to the
Acquired Intellectual Property.
SECTION 5.10. FILING, PROSECUTION AND MAINTENANCE OF PATENT
RIGHTS. From the date hereof through the Closing:
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(a) Seller shall take any action reasonably requested by
Purchaser that may be required to maintain the value, validity and
enforceability of the Seller Registered Intellectual Property and Seller shall,
within ten (10) business days, execute any documents reasonably requested by
Purchaser to file, maintain, preserve and renew all applications of and
registrations for the Seller Registered Intellectual Property in any country or
other jurisdiction in the world where action may be required to maintain
protection of the Seller Registered Intellectual Property, including the
recordation of this Agreement; PROVIDED that Purchaser shall pay for, or
reimburse Seller for, any filing fees or other expenses associated with any such
actions taken by Seller pursuant to this paragraph (a);
(b) Seller shall not intentionally take any action which may
reasonably be expected to jeopardize the use, value, validity, or enforceability
of the Seller Registered Intellectual Property anywhere of the world; and
(c) Seller shall promptly notify Purchaser if any existing
application for or registration of any Seller Registered Intellectual Property
in any country is expected to lapse, expire, be cancelled or otherwise become
abandoned or lose effect.
SECTION 5.11. EMPLOYMENT MATTERS. (a) Purchaser agrees that
following the Closing, each person listed on SCHEDULE I hereto (each "KEY
MEMBER") shall be offered employment by Cetoni, with the base compensation and
performance or time based bonuses (if any) set forth opposite such Key Member's
name on SCHEDULE I hereto. Each Key Member shall also be entitled to receive
employee benefits that are generally made available to Cetoni employees. Any
employment agreement entered into between Cetoni and a Key Member shall be
negotiated in good faith and subject to applicable law.
(b) Purchaser agrees that, prior to or as soon as practicable
following the Closing, and subject to approval by the shareholders of Purchaser,
the Board of Directors of Purchaser shall adopt a stock option plan (the "STOCK
PLAN") permitting the issuance of stock options and/or shares of restricted
Purchaser Common Stock for grants and awards to employees, consultants and
contractors of Purchaser or any of its subsidiaries.
(c) As soon as practicable following the later of (A) the
adoption and approval of the Stock Plan and (b) the Closing, the Board of
Directors of Purchaser shall approve a grant of stock options under the Stock
Plan for each Key Member in such amounts and with such time or performance based
vesting milestones determined by the Board of Directors of Purchaser in its sole
discretion or as otherwise required pursuant to the Stock Plan.
(d) The Board of Directors of Purchaser shall additionally
approve the award of restricted Purchaser Common Stock under the Stock Plan for
each Key Member in an amount equal to the number of shares set forth opposite
such person's name on SCHEDULE II hereto, subject to such restrictions and
buy-back rights as determined by the Board of Directors of Purchaser in its sole
discretion or as otherwise required pursuant to the Stock Plan.
SECTION 5.12. BAVARIA TECH. Purchaser shall use its reasonable
best efforts to obtain the release from (a) Sparkasse Passau of all obligations
and duties of Bavaria Tech, Schlattl and Xxxxxx Xxxxxxxx and (b) each other
creditor of Bavaria Tech set forth on Schedule 5.13 of all obligations and
duties of Bavaria Tech.
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ARTICLE VI.
CONDITIONS PRECEDENT
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SECTION 6.01. CONDITIONS TO EACH PARTY'S OBLIGATION. The
obligation of Purchaser to purchase the Acquired Intellectual Property and the
obligation of Seller to sell the Acquired Intellectual Property to Purchaser is
subject to the satisfaction or waiver on or prior to the Closing of the
following conditions:
(a) GOVERNMENTAL APPROVALS. All other authorizations,
consents, orders or approvals of, or declarations or filings with, or
expirations of waiting periods imposed by, any Governmental Entity necessary for
the consummation of the Acquisition shall have been obtained or filed or shall
have occurred.
(b) NO INJUNCTIONS OR RESTRAINTS. No Applicable Law or
injunction enacted, entered, promulgated, enforced or issued by any Governmental
Entity or other legal restraint or prohibition preventing the consummation of
the Acquisition shall be in effect.
SECTION 6.02. CONDITIONS TO OBLIGATION OF PURCHASER. The
obligation of Purchaser to purchase and pay for the Acquired Intellectual
Property is subject to the satisfaction (or waiver by Purchaser) on or prior to
the Closing Date of the following conditions:
(a) REPRESENTATIONS AND WARRANTIES. The representations and
warranties of Seller and Schlattl made in this Agreement shall be true and
correct in all material respects, as of the date hereof and as of the time of
the Closing as though made as of such time, and Purchaser shall have received a
certificate signed by Schlattl and an authorized officer of Seller to such
effect.
(b) PERFORMANCE OF OBLIGATIONS OF SELLER AND SCHLATTL. Each of
Seller and Schlattl shall have performed or complied in all material respects
with all obligations and covenants required by this Agreement to be performed or
complied with by Seller and Schlattl by the time of the Closing, and Purchaser
shall have received a certificate signed by Schlattl and an authorized officer
of Seller to such effect.
(c) ABSENCE OF PROCEEDINGS. There shall not be pending or
threatened any proceeding (i) challenging or seeking to restrain or prohibit the
Acquisition or any other transaction contemplated by this Agreement or seeking
to obtain from Purchaser or any of its subsidiaries in connection with the
Acquisition any damages or (ii) seeking to impose limitations on the ability of
Purchaser to acquire or hold, or exercise full rights of ownership of, the
Acquired Intellectual Property.
(d) CONSENTS. Purchaser shall have received written consents
from all third parties necessary or appropriate to effect the Acquisition.
(e) LIENS. Purchaser shall have received all written releases
and waivers or other evidences satisfactory to Purchaser that all Liens imposed
on the Acquired Intellectual Property have been removed.
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(f) INTELLECTUAL PROPERTY ASSIGNMENT. Purchaser shall have
received a copy of the Intellectual Assignment duly executed and delivered by
Seller.
(g) OTHER DOCUMENTS. Seller shall have furnished to Purchaser
such other documents relating to Seller's existence and authority (including
copies of resolutions of the board of directors of Seller), and such other
matters as Purchaser may reasonably request.
SECTION 6.03. CONDITIONS TO OBLIGATION OF SELLER. The
obligation of Seller to sell, assign, convey, and deliver the Acquired
Intellectual Property is subject to the satisfaction (or waiver by Seller) on or
prior to the Closing Date of the following conditions:
(a) REPRESENTATIONS AND WARRANTIES. The representations and
warranties of Purchaser made in this Agreement shall be true and correct in all
material respects, as of the date hereof and as of the time of the Closing as
though made as of such time, and Seller shall have received a certificate signed
by an authorized officer of Purchaser to such effect.
(b) PERFORMANCE OF OBLIGATIONS OF PURCHASER. Purchaser shall
have performed or complied in all material respects with all obligations and
covenants required by this Agreement to be performed or complied with by
Purchaser by the time of the Closing, and Seller shall have received a
certificate signed by an authorized officer of Purchaser to such effect.
(c) MERGER CLOSING CERTIFICATE. Seller shall have received a
certificate signed by an authorized officer of Purchaser certifying the
consummation of the Merger pursuant to the Merger Agreement will occur
immediately following the Closing.
(d) RUSSIAN TRANSACTIONS. Seller shall have received evidence
that the Russian Transactions shall have been consummated. "RUSSIAN
TRANSACTIONS" means (i) the contribution by Purchaser and its subsidiaries to a
51% owned subsidiary of Purchaser ("NEWCO") of certain of their respective
assets relating to operations of Purchaser and its subsidiaries in the Russian
Federation (the "RUSSIAN OPERATIONS"), (ii) the assumption by Newco of certain
liabilities of Purchaser and its subsidiaries relating to the Russian Operations
and (iii) the agreement that, as soon as practicable following the consummation
of the Merger, Xxxx Xxxxxxxxx and Xxxxx Xxxxxx will resign as officers of
Purchaser and its subsidiaries, as applicable.
(e) MORTGAGE. The indebtedness in connection with the mortgage
held by DSL Bank on Schlattl's property located at Xxxxxxxxxxxx 0, Xxxxxxxxx,
Xxxxxxx in an amount not to exceed $252,000 shall have been paid off and the
security interest thereunder shall have been released.
ARTICLE VII.
TERMINATION, AMENDMENT AND WAIVER
---------------------------------
SECTION 7.01. TERMINATION. (a) Notwithstanding anything to the
contrary in this Agreement, this Agreement may be terminated and the Acquisition
and the other transactions contemplated by this Agreement abandoned at any time
prior to the Closing:
(i) by mutual written consent of Seller and Purchaser;
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(ii) by Seller if any of the conditions set forth in Sections
6.01 or 6.03 shall have become incapable of fulfillment, and shall not
have been waived by Seller;
(iii) by Purchaser if any of the conditions set forth in
Sections 6.01 or 6.02 shall have become incapable of fulfillment, and
shall not have been waived by Purchaser; or
(iv) by Seller or Purchaser, if the Closing does not occur on
or prior to December 31, 2003;
PROVIDED, HOWEVER, that the party seeking termination pursuant to clause (ii) or
(iii) is not then in breach of any of its representations, warranties, covenants
or agreements contained in this Agreement.
(b) In the event of termination by Seller or Purchaser
pursuant to this Section 7.01, written notice thereof shall forthwith be given
to the other and the transactions contemplated by this Agreement shall be
terminated, without further action by any party.
SECTION 7.02. EFFECT OF TERMINATION. If this Agreement is
terminated and the transactions contemplated hereby are abandoned as described
in Section 7.01, this Agreement shall become null and void and of no further
force and effect, except for the provisions of (i) Section 5.04 relating to
certain expenses, (ii) Section 7.01 and this Section 7.02 and (iii) Section 5.07
relating to publicity. Nothing in this Section 7.02 shall be deemed to release
any party from any liability for any breach by such party of the terms and
provisions of this Agreement or to impair the right of any party to compel
specific performance by any other party of its obligations under this Agreement.
SECTION 7.03. AMENDMENTS AND WAIVERS. This Agreement may not
be amended except by an instrument in writing signed on behalf of each of the
parties hereto. By an instrument in writing Purchaser, on the one hand, or
Seller and Schlattl, on the other hand, may waive compliance by the other party
with any term or provision of this Agreement that such other party was or is
obligated to comply with or perform.
ARTICLE VIII.
INDEMNIFICATION
---------------
SECTION 8.01. INDEMNIFICATION BY SELLER AND SCHLATTL. From and
after the Closing, Seller and Schlattl, jointly and severally, shall indemnify
Purchaser and its affiliates and each of their respective officers, directors,
employees, stockholders, agents and representatives against, and hold them
harmless from, any loss, liability, claim, damage or expense (including
reasonable legal fees and expenses) ("LOSSES"), as incurred (payable promptly
upon written request), arising from, in connection with or otherwise with
respect to (i) any breach of any representation or warranty of Seller or
Schlattl that is contained in this Agreement or in any document or certificate
delivered in connection herewith and (ii) any breach of any covenant of Seller
or Schlattl contained in this Agreement.
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SECTION 8.02. INDEMNIFICATION BY PURCHASER. From and after the
Closing, Purchaser shall indemnify Seller and its affiliates and each of their
respective officers, directors, employees, stockholders, agents and
representatives against, and agrees to hold them harmless from, any Loss, as
incurred (payable promptly upon written request), for or on account of or
arising from or in connection with or otherwise with respect to (i) any breach
of any representation or warranty of Purchaser contained in this Agreement or in
any document or certificate delivered in connection herewith and (ii) any breach
of any covenant of Purchaser contained in this Agreement.
SECTION 8.03. CLAIMS. In the event any indemnified party
should have a claim against any indemnifying part under Section 8.01 or 8.02,
the indemnified party shall deliver notice of such claim with reasonable
promptness to the indemnifying party. The failure by any indemnified party to so
notify the indemnifying party shall not relieve the indemnifying party from any
liability that it may have to such indemnified party under Section 8.01 or 8.02,
except to the extent that the indemnifying party demonstrates that it has been
materially prejudiced by such failure. If the indemnifying party does not notify
the indemnified party within 10 calendar days following its receipt of such
notice that the indemnifying party disputes its liability to the indemnified
party under Section 8.01 or 8.02, such claim specified by the indemnified party
in such notice shall be conclusively deemed a liability of the indemnifying
party under Section 8.01 or 8.02 and the indemnifying party shall pay the amount
of such liability to the indemnified party on demand or, in the case of any
notice in which the amount of the claim (or any portion thereof) is estimated,
on such later date when the amount of such claim (or such portion thereof)
becomes finally determined. If the indemnifying party has timely disputed its
liability with respect to such claim, as provided above, the indemnifying party
and the indemnified party shall proceed in good faith to negotiate a resolution
of such dispute and, if not resolved through negotiations, such dispute shall be
resolved by litigation in an appropriate court of competent jurisdiction.
ARTICLE IX.
GENERAL PROVISIONS
------------------
SECTION 9.01. ASSIGNMENT. This Agreement and the rights and
obligations hereunder shall not be assignable or transferable by Purchaser,
Seller or Schlattl without the prior written consent of the other parties
hereto. Notwithstanding the foregoing, (a) Seller may assign its rights and
obligations hereunder to Schlattl in connection with the Schlattl Transfer made
in accordance with Section 5.01(b) and (b) Purchaser may assign its right to
purchase the Acquired Intellectual Property or any portion thereof hereunder to
a subsidiary of Purchaser without the prior written consent of Seller or
Schlattl. Any attempted assignment in violation of this Section 9.01 shall be
void.
SECTION 9.02. NO THIRD-PARTY BENEFICIARIES. Except as provided
in Article VIII, this Agreement is for the sole benefit of the parties hereto
and their permitted assigns and nothing herein expressed or implied shall give
or be construed to give to any person, other than the parties hereto and such
assigns, any legal or equitable rights hereunder.
SECTION 9.03. ATTORNEY FEES. A party in breach of this
Agreement shall, on demand, indemnify and hold harmless the other party for and
against all reasonable out-of-pocket expenses, including legal fees, incurred by
such other party by reason of the enforcement and protection of its rights under
this Agreement. The payment of such expenses is in addition to any other relief
to which such other party may be entitled.
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SECTION 9.04. NOTICES. All notices or other communications
required or permitted to be given hereunder shall be in writing and shall be
delivered by hand or sent by facsimile or sent, postage prepaid, by registered,
certified or express mail or reputable overnight courier service and shall be
deemed given when so delivered by hand or facsimile, or if mailed, three days
after mailing (one business day in the case of express mail or overnight courier
service), as follows:
(i) if to Purchaser,
ATI Inc.
0000 Xxxx Xxxxxx, Xxx 0000
Xxxxxx, XX 00000
Attention: Xxxxx Xxxxxxxxx
(ii) if to Seller or Schlattl,
Xxxxxxxxxxxx 0
00000 Xxxxxxxxx
Xxxxxxx
Attention: Xxxxx Xxxxxxxx
SECTION 9.05. INTERPRETATION; EXHIBITS AND SCHEDULES; CERTAIN
DEFINITIONS. (a) The headings contained in this Agreement, in any Exhibit or
Schedule hereto and in the table of contents to this Agreement are for reference
purposes only and shall not affect in any way the meaning or interpretation of
this Agreement. All Exhibits and Schedules annexed hereto or referred to herein
are hereby incorporated in and made a part of this Agreement as if set forth in
full herein. Any capitalized terms used in any Schedule or Exhibit but not
otherwise defined therein, shall have the meaning as defined in this Agreement.
When a reference is made in this Agreement to a Section, Exhibit or Schedule,
such reference shall be to a Section of, or an Exhibit or Schedule to, this
Agreement unless otherwise indicated.
(b) For all purposes hereof:
"affiliate" of any person means another person that directly
or indirectly, through one or more intermediaries, controls, is controlled by,
or is under common control with, such first person.
"including" means including, without limitation.
"person" means any individual, firm, corporation, partnership,
limited liability company, trust, joint venture, Governmental Entity or other
entity.
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"subsidiary" of any person means another person, an amount of
the voting securities, other voting ownership or voting partnership interests of
which is sufficient to elect at least a majority of its Board of Directors or
other governing body (or, if there are no such voting interests, 50% or more of
the equity interests of which) is owned directly or indirectly by such first
person.
SECTION 9.06. COUNTERPARTS. This Agreement may be executed in
one or more counterparts, all of which shall be considered one and the same
agreement, and shall become effective when one or more such counterparts have
been signed by each of the parties and delivered to the other party.
SECTION 9.07. ENTIRE AGREEMENT. This Agreement, and the
Intellectual Property Assignment, along with the Schedules and Exhibits thereto,
contain the entire agreement and understanding between the parties hereto with
respect to the subject matter hereof and supersede all prior agreements and
understandings relating to such subject matter.
SECTION 9.08. SEVERABILITY. If any provision of this Agreement
(or any portion thereof) or the application of any such provision (or any
portion thereof) to any person or circumstance shall be held invalid, illegal or
unenforceable in any respect by a court of competent jurisdiction, such
invalidity, illegality or unenforceability shall not affect any other provision
hereof (or the remaining portion thereof) or the application of such provision
to any other persons or circumstances.
SECTION 9.09. CONSENT TO JURISDICTION. Each of Seller and
Schlattl irrevocably submits to the exclusive jurisdiction of (a) the Delaware
Court of Chancery, and (b) the United States District Court for the District of
Delaware, for the purposes of any suit, action or other proceeding arising out
of this Agreement or any transaction contemplated hereby or thereby. Each of
Seller and Schlattl agrees to commence any such action, suit or proceeding
either in the United States District Court for the District of Delaware or if
such suit, action or other proceeding may not be brought in such court for
jurisdictional reasons, in the Delaware Court of Chancery. Each of Seller and
Schlattl further agrees that service of any process, summons, notice or document
by U.S. registered mail to such party's respective address set forth above shall
be effective service of process for any action, suit or proceeding in Delaware
with respect to any matters to which it has submitted to jurisdiction in this
Section 9.09. Each of Seller and Schlattl irrevocably and unconditionally waives
any objection to the laying of venue of any action, suit or proceeding arising
out of this Agreement or the transactions contemplated hereby and thereby in (i)
the Delaware Court of Chancery, or (ii) the United States District Court for the
District of Delaware, and hereby and thereby further irrevocably and
unconditionally waives and agrees not to plead or claim in any such court that
any such action, suit or proceeding brought in any such court has been brought
in an inconvenient forum.
SECTION 9.10. GOVERNING LAW. This Agreement shall be governed
by and construed in accordance with the internal laws of the State of Delaware
applicable to agreements made and to be performed entirely within such State,
without regard to the conflicts of law principles of such State.
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IN WITNESS WHEREOF, Seller, Schlattl and Purchaser have duly
executed this Agreement as of the date first written above.
________________________
Xxxxx Xxxxxxxx
ALFA-PRO PRODUCTS GMBH,
by
________________________
Name:
Title:
ADVANCED TECHNOLOGY INDUSTRIES, INC.
by
________________________
Name:
Title:
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