Exhibit 10.14
SECURITIES PURCHASE AGREEMENT
BY AND AMONG
BUYER
AND
THE SHAREHOLDERS OF
THE COMPANY NAMED HEREIN
Dated January 10, 2000,
Effective as of December 31, 1999
TABLE OF CONTENTS
Page
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ARTICLE I THE ACQUISITION................................................ 1
1.1 Closing........................................................ 1
1.2 Purchase and Sale of Company Shares............................ 1
1.3 Consideration for Company Shares............................... 2
ARTICLE II REPRESENTATIONS AND WARRANTIES CONCERNING THE
COMPANY AND THE NEW COMPANY SUBSIDIARIES............................ 2
2.1 Organization and Standing; Articles and Bylaws................. 2
2.2 No Conflicts; Governmental Consent; Permits.................... 2
2.3 Capitalization................................................. 3
2.4 Subsidiaries................................................... 3
2.5 Limited Prior Activities....................................... 3
2.6 Compliance with Laws........................................... 4
2.7 Litigation, etc................................................ 4
2.8 Brokers' and Finders' Fees..................................... 4
2.9 Disclosure..................................................... 4
ARTICLE III REPRESENTATIONS AND WARRANTIES CONCERNING TEMIC.............. 4
3.1 Incorporation of Representations and Warranties................ 4
3.2 Amounts Paid to HMTF........................................... 5
3.3 Consummation of Acquisition of Temic........................... 5
ARTICLE IV REPRESENTATIONS AND WARRANTIES OF AND REGARDING THE
SHAREHOLDERS........................................................ 5
4.1 Power, Consents and Authorization.............................. 5
4.2 Title to Securities............................................ 6
4.3 No Conflicts................................................... 6
4.4 Absence of Claims.............................................. 6
4.5 Investment Representations..................................... 6
ARTICLE V REPRESENTATIONS AND WARRANTIES OF BUYER........................ 9
5.1 Organization and Standing; Articles and Bylaws................. 10
5.2 Corporate Power................................................ 10
5.3 Subsidiaries................................................... 10
5.4 Capitalization................................................. 10
5.5 Authorization.................................................. 11
5.6 Material Liabilities........................................... 11
5.7 Title to Properties and Assets; Liens, etc..................... 12
5.8 Compliance with Laws; No Conflicts............................. 12
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TABLE OF CONTENTS
(continued)
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5.9 Patents and Trademarks......................................... 12
5.10 Litigation, etc................................................ 13
5.11 Employees...................................................... 13
5.12 Registration Rights and Voting Agreements...................... 13
5.13 Governmental Consents.......................................... 13
5.14 Offering....................................................... 13
5.15 Brokers' and Finders' Fees..................................... 14
5.16 Disclosure..................................................... 14
5.17 No Conflict of Interest........................................ 14
5.18 Permits........................................................ 14
5.19 Agreements; Action............................................. 14
5.20 Financial Statements........................................... 16
5.21 Changes........................................................ 17
5.22 Employee Benefit Plans......................................... 17
5.23 Tax Returns and Payments....................................... 17
5.24 Insurance...................................................... 17
5.25 Labor Agreements and Actions................................... 17
5.26 Environmental and Safety Laws.................................. 17
5.27 Year 2000 Matters.............................................. 17
5.28 Investment Company Act......................................... 18
5.29 HSR Act........................................................ 18
ARTICLE VI ADDITIONAL AGREEMENTS.......................................... 18
6.1 Reincorporation into Delaware.................................. 18
6.2 Expenses....................................................... 18
6.3 Public Disclosure.............................................. 18
6.4 Stock Option Grants............................................ 18
6.5 Financial Information.......................................... 19
6.6 Change of Name................................................. 20
ARTICLE VII DOCUMENTS DELIVERED AT THE CLOSING............................ 20
7.1 Documents Delivered by the Shareholders at Closing............. 20
7.2 Documents Delivered by Buyer at Closing........................ 21
ARTICLE VIII SURVIVAL OF REPRESENTATIONS AND WARRANTIES, INDEMNIFICATION.. 22
8.1 Survival of Representations and Warranties..................... 22
8.2 Indemnification................................................ 22
8.3 Third-Party Claims............................................. 23
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TABLE OF CONTENTS
(continued)
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ARTICLE IX GENERAL PROVISIONS...................................... 24
9.1 No Joint Venture........................................ 24
9.2 Waiver.................................................. 24
9.3 Notices................................................. 25
9.4 Governing Law........................................... 26
9.5 Entire Agreement........................................ 26
9.6 Successors and Assigns.................................. 26
9.7 Severability............................................ 26
9.8 Further Assurances...................................... 26
9.9 Other Remedies; Specific Performance.................... 26
9.10 Interpretation; Titles and Subtitles.................... 27
9.11 Absence of Third Party Beneficiary Rights............... 27
9.12 Language................................................ 27
9.13 Counterparts............................................ 27
9.14 No Recourse............................................. 27
9.15 Definitions............................................. 27
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SECURITIES PURCHASE AGREEMENT
This SECURITIES PURCHASE AGREEMENT (this "Agreement") is made and entered
into January 10, 2000 (the "Signing Date"), to be effective as of December 31,
1999 (the "Effective Date") among MicroTune, Inc., a Texas corporation (the
"Buyer"), and the persons listed on the signature pages hereto as shareholders
of HMTF Acquisition (Bermuda), Ltd., a company organized under the Laws of
Bermuda (the "Company"), (each a "Shareholder" and collectively the
"Shareholders").
Except as otherwise set forth in this Agreement, capitalized terms shall
have the definitions set forth in Section 9.15.
RECITALS
A. The Shareholders are collectively the owners of all of the issued and
outstanding common shares, par value $0.10 per share of the Company (the
"Company Shares"), which Company Shares represent all of the issued and
outstanding capital stock of the Company.
B. The Shareholders desire to sell to Buyer, and Buyer desires to purchase
from the Shareholders, all of the Company Shares, subject to the terms and
conditions of this Agreement (the "Acquisition").
NOW, THEREFORE, in consideration of the mutual covenants, promises, and
representations set forth herein, and for other good and valuable consideration,
the receipt and sufficiency of which are hereby acknowledged, the parties hereto
hereby agree as follows.
ARTICLE I
THE ACQUISITION
1.1 Closing. The consummation of the Acquisition (the "Closing") shall be
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deemed effective as of the Effective Date and shall take place concurrently with
the execution and delivery of this Agreement (the "Closing Date"), at the
offices Weil, Gotshal & Xxxxxx LLP, 000 Xxxxxxxx Xxxxx, Xxxxx 0000, Xxxxxx,
Xxxxx.
1.2 Purchase and Sale of Company Shares. Concurrently herewith and on the
-----------------------------------
terms and subject to the conditions of this Agreement, each Shareholder is
selling and delivering to Buyer, and Buyer is purchasing from each such
Shareholder, all right, title, and interest of such Shareholder in and to the
Company Shares set forth opposite such Shareholder's name on Schedule 1.2, free
and clear of all Liens.
1.3 Consideration for Company Shares. In consideration of the transfer of
--------------------------------
the Company Shares pursuant to Section 1.2, Buyer is concurrently herewith
issuing to each Shareholder (i) the number of shares (the "Series E Preferred
Shares") of Buyer's Series E Preferred Stock, par value $.001 per share (the
"Series E Preferred Stock"), set forth opposite such Shareholder's name on
Schedule 1.3, and (ii) warrants, substantially in the form attached hereto as
Exhibit A (the "Warrants"), to purchase up to the number of shares (the "Warrant
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Shares") of Buyer's common stock, par value $0.001 per share, (the "Common
Stock") set forth opposite such Shareholder's name on Schedule 1.3.
ARTICLE II
REPRESENTATIONS AND WARRANTIES CONCERNING THE COMPANY
AND THE NEW COMPANY SUBSIDIARIES
The HM Shareholders, jointly and severally, hereby represent and warrant to
Buyer, as of the Signing Date (unless a different date is specified within a
particular section), subject to such exceptions as are specifically disclosed in
the Schedule 2 with reference to the appropriate section number (the "Company
Disclosure Schedule") as follows:
2.1 Organization and Standing; Articles and Bylaws. Each of the Company
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and each subsidiary of the Company listed in Section 2.1 of the Company
Disclosure Schedule (the "New Company Subsidiaries") is a company duly organized
and existing under, and by virtue of, the Laws of its jurisdiction of
organization and is in good standing under such Laws. Each of the Company and
each New Company Subsidiary has the requisite corporate or other power and
authority to own and operate its properties and assets and to carry on its
business as presently conducted and proposed to be conducted. Each of the
Company and each New Company Subsidiary is duly qualified to do business and is
in good standing in each jurisdiction in which the failure to be so qualified
would have a Material Adverse Effect on the Company or the New Company
Subsidiary, as the case may be. The HM Shareholders have delivered to Buyer a
true and correct copy of each of the Company Charter Documents.
2.2 No Conflicts; Governmental Consent; Permits.
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(a) The execution and delivery of this Agreement by the Shareholders
does not, and, as of the Closing Date, the consummation of the transactions
contemplated by this Agreement will not: (i) conflict with any provision of the
Company Charter Documents; (ii) conflict with, or result in any violation of, or
constitute a default (with or without notice, lapse of time, or both) under, or
give rise to a right of termination, cancellation, or acceleration of any
obligation or to loss of benefit under, any material mortgage, indenture, lease,
contract, or other agreement or instrument, permit, or license to which the
Company or any of the New Company Subsidiaries is a party or by which any of
their assets are bound; (iii) constitute a material violation of any Law
applicable to the Company or any of the New Company Subsidiaries or their
properties or assets; or (iv) result in the creation of any Lien upon any of
their assets; and there is no such violation or default which will
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have a Material Adverse Effect on the Company or any New Company Subsidiary or
any of their respective properties or assets.
(b) Except as set forth in Section 2.2(b) of the Company Disclosure
Schedule, each of the Company and each New Company Subsidiary has all permits,
licenses and any similar authority necessary for the conduct of its business as
now being conducted by it, except for any such permits, licenses or authority
the lack of which would not have a Material Adverse Effect on the Company or the
New Company Subsidiaries, as the case may be. Each of the Company and each New
Company Subsidiary is not in default in any material respect under any such
permits, licenses or other similar authority.
2.3 Capitalization.
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(a) The authorized capital stock of the Company consists of 1,200,000
common shares, par value $0.10 per share. As of the Signing Date, there are
issued and outstanding 158,058 Company Shares. The outstanding Company Shares
are held of record by the Persons and in the amounts set forth in Section 2.3(a)
of the Company Disclosure Schedule. The authorized capital stock or other equity
interests of each New Company Subsidiary and the total number of issued and
outstanding shares of capital stock or other equity interests of each New
Company Subsidiary is set forth in Section 2.3(a) of the Company Disclosure
Schedule.
(b) All of the outstanding Company Shares, and all of the outstanding
shares of each New Company Subsidiary (except for directors' qualifying shares),
have been duly authorized, validly issued, are fully paid and non-assessable.
(c) There are no outstanding securities, rights (preemptive or
other), subscriptions, calls, warrants, options, or other agreements (except for
this Agreement) to which the Company, any New Company Subsidiary, or HMTF or any
of its Affiliates, is a party that give any Person the right to purchase,
subscribe for, or otherwise receive or be issued any shares of capital stock of
the Company or any New Company Subsidiary or any security convertible into or
exchangeable or exercisable for any shares of capital stock of the Company or
any New Company Subsidiary.
2.4 Subsidiaries. Except for the New Company Subsidiaries, Temic, and any
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Subsidiaries of Temic as set forth in Section 2.4 of the Company Disclosure
Schedule, the Company has no Subsidiaries and does not otherwise own or control,
directly or indirectly, any equity interest in any corporation, association, or
business entity.
2.5 Limited Prior Activities. Except for obligations incurred in
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connection with its formation and except as set forth in Section 2.5 of the
Company Disclosure Schedule, neither the Company nor any New Company Subsidiary
has incurred any liability or obligation or engaged in any business or activity
of any type or kind whatsoever or entered into any agreement or arrangement with
any Person. Section 2.5 of the Company Disclosure Schedule lists all agreements
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and documents entered into by the Company and each New Company Subsidiary in
connection with its formation.
2.6 Compliance with Laws. The Company and each New Company Subsidiary has
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complied with each Law binding on the Company or any New Company Subsidiary, or
any of their respective assets or properties and is not currently in violation
of any of the foregoing, except for such failures to comply or violations as
would not have a Material Adverse Effect on the Company or such New Company
Subsidiary.
2.7 Litigation, etc. There are no actions, suits, proceedings or
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investigations pending against Company, any of the New Company Subsidiaries, or
any of their respective properties before any Governmental Entity (nor, to the
HM Shareholder's knowledge, is there any reasonable basis therefor or threat
thereof).
2.8 Brokers' and Finders' Fees. None of the HM Shareholders, the Company
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or any New Company Subsidiary has incurred, nor will it incur, directly or
indirectly as a result of any action taken by the HM Shareholders, the Company
or the New Company Subsidiaries, any liability for brokerage or finder's fees,
or agents' commissions or any similar charges in connection with this Agreement.
2.9 Disclosure. This Agreement with the Schedules hereto provided by the
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HM Shareholders with respect to the HM Shareholders, when taken as a whole, does
not contain any untrue statement of a material fact or omit to state a material
fact necessary in order to make the statements contained herein not misleading
in the light of the circumstances under which they were made.
ARTICLE III
REPRESENTATIONS AND WARRANTIES CONCERNING TEMIC
The HM Shareholders, jointly and severally, hereby represent and warrant to
Buyer, as of the Signing Date (unless a different date is specified within a
particular section), subject to such exceptions as are specifically disclosed in
the Schedule 3 with reference to the appropriate section number (the "Temic
Disclosure Schedule"), as follows:
3.1 Incorporation of Representations and Warranties. The representations
and warranties of the Sellers (as defined therein) set forth in the Share Sale,
Purchase and Transfer Agreement regarding Shares in a GmbH (the "Temic Purchase
Agreement") dated as of November 29, 1999, by and among HMT Erste Beteiligungs
GmbH x.Xx., a German limited liability company, HMTF Verwaltungs GmbH (formerly
known as Residenz Zehnte Vermogensverwaltungs GmbH), a German limited liability
company, the Company, MAR, Vermogensverwaltungsgesellschaft mbH, a German
limited liability company, and Dipl.-Ing. (TU) Xxxxxx Xxxxxxxxx and the Sellers,
pursuant to which the Company acquired the business of Temic Telefunken
Hochfrequenztechnik GmbH
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("Temic"), are herein incorporated into this Agreement as representations and
warranties given by the HM Shareholders hereunder as of the Signing Date;
provided, however, such representations and warranties shall be deemed modified
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to the extent such representations and warranties are rendered incorrect as a
result of the consummation of the transactions contemplated by the Temic
Purchase Agreement and the documents and instruments delivered in connection
therewith, as described in Section 3.1 of the Temic Disclosure Schedule.
3.2 Amounts Paid to HMTF. Section 3.2 of the Temic Disclosure Schedule
--------------------
sets forth all of the cash disbursements, payments and other transfers of
property (whether to be made prior to, or to be made after, the Closing) from
Temic, the Company or any New Company Subsidiary to Hicks, Muse, Xxxx & Xxxxx
Incorporated or any Affiliate or Subsidiary or advisor or representative (other
than Temic, the Company or any New Company Subsidiary) of Hicks, Muse, Xxxx &
Xxxxx Incorporated.
3.3 Consummation of Acquisition of Temic. The transactions contemplated
------------------------------------
under the Temic Purchase Agreement have been consummated, and there are no
further contingencies or covenants to be fulfilled prior to closing of the
transactions contemplated under the Temic Purchase Agreement. All of the
material agreements entered into in connection with the acquisition of Temic by
the Company are listed in Section 3.3 of the Temic Disclosure Schedule and have
been provided to Buyer for its review.
ARTICLE IV
REPRESENTATIONS AND WARRANTIES OF
AND REGARDING THE SHAREHOLDERS
Each of the Shareholders, severally and not jointly, represents and
warrants to Buyer, as of the Signing Date (unless a different date is specified
within a particular section), subject to such exceptions as are specifically
disclosed in the Schedule 4 with reference to the appropriate section number
(the "Shareholder Disclosure Schedule") as follows:
4.1 Power, Consents and Authorization.
---------------------------------
(a) Such Shareholder has all requisite legal (corporate or otherwise)
power and authority to execute and deliver this Agreement and each of the
Related Agreements and to carry out and perform its obligations under the terms
of this Agreement and the Related Agreements.
(b) Except as set forth in Section 4.1(b) of the Shareholder
Disclosure Schedule, no consent, approval or authorization of or designation,
declaration or filing with any Governmental Entity, on the part of such
Shareholder is required in connection with the valid execution and delivery of
this Agreement or the consummation of any other transaction contemplated hereby.
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(c) Each of this Agreement and the Related Agreements executed and
delivered by the Shareholder shall (assuming the due authorization, execution,
and delivery hereof and thereof by the other parties hereto and thereto)
constitute valid and binding obligations of such Shareholder, enforceable
against such Shareholder in accordance with their terms, subject to laws of
general application relating to bankruptcy, insolvency and the relief of debtors
and rules of law governing specific performance, injunctive relief or other
equitable remedies.
4.2 Title to Securities. Such Shareholder owns of record and beneficially
-------------------
the number of Company Shares set forth opposite such Shareholder's name in
Section 4.2 of the Shareholder Disclosure Schedule. Except as set forth in
Section 4.2 of the Shareholder Disclosure Schedule, such Shareholder owns all
right, title and interest in and to such Company Shares, free and clear of all
Liens.
4.3 No Conflicts. The execution and delivery of this Agreement and each
------------
Related Agreement by such Shareholder does not, and the performance by such
Shareholder of the transactions contemplated to be performed by it hereunder and
thereunder and the consummation of the transactions contemplated hereby and
thereby, will not (i) if such Shareholder is other than a natural person,
conflict with its certificate or incorporation or bylaws or other similar
organizational or governance documents; (ii) conflict with, or result in any
violation of, or constitute a default (with or without notice, lapse of time, or
both) under, or give rise to a right of termination, cancellation, or
acceleration of any obligation or to loss of benefit under, any material
mortgage, indenture, lease, contract, or other agreement or instrument, permit,
or license to which such Shareholder is a party or by which any of its assets
are bound; (iii) constitute a material violation of any Law applicable to such
Shareholder or its properties or assets, or (iv) result in the creation of any
Lien upon any of its assets.
4.4 Absence of Claims. Except as set forth in Schedule 4.4 of the
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Shareholder Disclosure Schedule, such Shareholder has no claim against the
Company or any of the New Company Subsidiaries, except for accrued compensation
and benefits and the reimbursement of expenses incurred in the ordinary course
of business. Such Shareholder has no right, claim or interest in or to any stock
or equity ownership interest in the Company except for the Company Shares set
forth in Schedule 1.2 and such rights, claims or interests of such Shareholder
under the Temic Purchase Agreement. Such Shareholder has no right, claim or
interest in or to the intellectual property rights of the Company or any New
Company Subsidiary.
4.5 Investment Representations.
--------------------------
(a) Shareholder is aware of Buyer's business affairs and financial
condition and has had access to and has acquired sufficient information about
Buyer to reach an informed and knowledgeable decision to acquire the Series E
Preferred Shares and Warrants to be acquired hereunder (the "Securities").
Shareholder has such business and financial experience as is required to give it
the capacity to protect its own interests in connection with the purchase of the
Securities.
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(b) Except as otherwise set forth in Schedule 4.5(b) of the
Shareholder Disclosure Schedule, Shareholder is purchasing the Securities for
its own account as principal, for investment purposes only, and not with a
present view to, or for, resale, distribution or fractionalization thereof, in
whole or in part, within the meaning of the Securities Act. Shareholder
understands that its acquisition of the Securities has not been registered under
the Securities Act or registered or qualified under any state securities Law in
reliance on specific exemptions therefrom, which exemptions may depend upon,
among other things, the bona fide nature of Shareholder's investment intent as
expressed herein.
(c) Each Shareholder that resides and is domiciled in and is a
citizen of the United States of America (a "U.S. Shareholder") further
represents and warrants that:
(i) Such U.S. Shareholder is an "accredited investor" as
defined in Rule 501 (a)(1), (a)(2), (a)(3), (a)(5), (a)(6), or (a)(7) or a
"Qualified Institutional Buyer" as defined in Rule 144A under the Securities
Act.
(ii) Such U.S. Shareholder further acknowledges and understands
that the Securities may not be resold to any Person or otherwise transferred
except in a transaction registered under the Securities Act or pursuant to an
exemption from such registration. Such U.S. Shareholder understands that the
certificates evidencing the Securities will be imprinted with a legend that
prohibits the transfer of the Securities unless (a) such transaction is
registered or such registration is not required, and (b) if the transfer is
pursuant to an exemption from registration other than Rule 144 under the
Securities Act, and if Buyer shall so require in writing, an opinion reasonably
satisfactory to Buyer, delivered by counsel reasonable satisfactory to Buyer, is
obtained to the effect that the transaction is so exempt.
(iii) Such U.S. Shareholder acknowledges and agrees that each
certificate representing the Series E Preferred Shares issued to such U.S.
Shareholder hereunder shall bear substantially the following legends (in
addition to any legends required under applicable state securities Laws):
THE SECURITIES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN
REGISTERED UNDER THE SECURITIES ACT OF 1933. THEY MAY NOT BE
SOLD, OFFERED FOR SALE, PLEDGED, HYPOTHECATED, OR OTHERWISE
TRANSFERRED EXCEPT PURSUANT TO AN EFFECTIVE REGISTRATION
STATEMENT UNDER THE SECURITIES ACT OF 1933, OR AN OPINION OF
COUNSEL REASONABLY SATISFACTORY TO THE COMPANY THAT REGISTRATION
IS NOT REQUIRED UNDER SUCH ACT OR UNLESS SOLD PURSUANT TO RULE
144 UNDER SUCH ACT.
(iv) Each U.S. Shareholder acknowledges and agrees that each
certificate representing the Warrants issued to such U.S. Shareholder shall bear
substantially the following legend (in addition to any legends required under
applicable state securities Laws):
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THIS WARRANT AND THE SECURITIES ISSUABLE UPON THE EXERCISE HEREOF
HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933. THEY
MAY NOT BE SOLD, OFFERED FOR SALE, PLEDGED, HYPOTHECATED, OR
OTHERWISE TRANSFERRED EXCEPT PURSUANT TO AN EFFECTIVE
REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933, OR AN
OPINION OF COUNSEL REASONABLY SATISFACTORY TO THE COMPANY THAT
REGISTRATION IS NOT REQUIRED UNDER SUCH ACT OR UNLESS SOLD
PURSUANT TO RULE 144 UNDER SUCH ACT.
(d) Each Shareholder that does not reside and is not domiciled in and
is not a citizen of the United States of America (a "Non-U.S. Shareholder")
further represents and warrants that:
(i) Except as set forth in Section 4.5(d)(i) of the Shareholder
Disclosure Schedule, neither the Non-U.S. Shareholder nor any Person for the
account of whom such Non-U.S. Shareholder is acting, including the estate of any
such Person, a trust of which any such Person is a beneficiary, or a
corporation, partnership trust or other entity organized under the laws of the
United States of America, its territories and possessions and all areas under
the jurisdiction of the United States of America, is a citizen or resident of
the United States of America (a "U.S. Person").
(ii) Except for transfers for estate planning purposes to
immediate family members or trusts organized for the benefit of immediate family
members not in violation of applicable securities Laws, such Non-U.S.
Shareholder will not sell, transfer or otherwise dispose of the Securities for a
period of one year after the Closing Date, and such Non-U.S. Shareholder will
not thereafter sell or otherwise transfer the Securities to a U.S. Person unless
Buyer has received an opinion of counsel, which opinion and counsel shall be
reasonably satisfactory to Buyer, that such transfer will not be in violation of
the Securities Act or any applicable state securities Laws.
(iii) The Non-U.S. Shareholder understands that Buyer will not
allow any transfer or other disposition of the Securities unless the proposed
transferee shall have executed an instrument containing the representations set
forth in the preceding two paragraphs or Buyer shall have received an opinion of
counsel, which opinion and counsel shall be reasonably satisfactory to Buyer, to
the effect that such proposed transfer would not be in violation of the
Securities Act or any applicable state or foreign securities Law.
(iv) The share certificate(s) of a Non-U.S. Shareholder
evidencing the Series E Preferred Shares shall bear the following legend (in
addition to any other legend required under this Agreement):
THE SECURITIES REPRESENTED BY THIS INSTRUMENT HAVE NOT BEEN
REGISTERED UNDER THE UNITED STATES SECURITIES ACT OF 1933, AS
AMENDED ("ACT"), OR THE SECURITIES LAWS OF ANY STATE OF THE
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UNITED STATES ("STATE ACT") AND MAY NOT BE SOLD, OFFERED FOR
SALE, PLEDGED, HYPOTHECATED, OR OTHERWISE TRANSFERRED FOR A
PERIOD OF ONE YEAR AFTER THE DATE ON THE FACE HEREOF, TO A
CITIZEN OR RESIDENT OF THE UNITED STATES OF AMERICA, INCLUDING
THE ESTATE OF ANY SUCH PERSON, A TRUST OF WHICH ANY SUCH PERSON
IS A BENEFICIARY, OR A CORPORATION, PARTNERSHIP, TRUST OR OTHER
ENTITY ORGANIZED UNDER THE LAWS OF THE UNITED STATES OF AMERICA,
ITS TERRITORIES AND POSSESSIONS AND ALL AREAS UNDER THE
JURISDICTION OF THE UNITED STATES OF AMERICA, UNLESS THE COMPANY
HAS RECEIVED AN OPINION OF COUNSEL, REASONABLY SATISFACTORY TO
THE COMPANY, THAT SUCH TRANSFER WILL NOT BE IN VIOLATION OF THE
ACT OR ANY APPLICABLE STATE ACT.
(v) Each Non-U.S. Shareholder acknowledges and agrees that each
certificate representing the Warrants issued to such Non-U.S. Shareholder shall
bear substantially the following legend (in addition to any other legend
required under this Agreement):
THIS WARRANT AND THE SECURITIES ISSUABLE UPON EXERCISE HEREOF
HAVE NOT BEEN REGISTERED UNDER THE UNITED STATES SECURITIES ACT
OF 1933, AS AMENDED ("ACT"), OR THE SECURITIES LAWS OF ANY STATE
OF THE UNITED STATES ("STATE ACT") AND MAY NOT BE SOLD, OFFERED
FOR SALE, PLEDGED, HYPOTHECATED, OR OTHERWISE TRANSFERRED FOR A
PERIOD OF ONE YEAR AFTER THE DATE ON THE FACE HEREOF TO A CITIZEN
OR RESIDENT OF THE UNITED STATES OF AMERICA, INCLUDING THE ESTATE
OF ANY SUCH PERSON, A TRUST OF WHICH ANY SUCH PERSON IS A
BENEFICIARY, OR A CORPORATION, PARTNERSHIP, TRUST OR OTHER ENTITY
ORGANIZED UNDER THE LAWS OF THE UNITED STATES OF AMERICA, ITS
TERRITORIES AND POSSESSIONS AND ALL AREAS UNDER THE JURISDICTION
OF THE UNITED STATES OF AMERICA, UNLESS THE COMPANY HAS RECEIVED
AN OPINION OF COUNSEL, REASONABLY SATISFACTORY TO THE COMPANY,
THAT SUCH TRANSFER WILL NOT BE IN VIOLATION OF THE ACT OR ANY
APPLICABLE STATE ACT.
ARTICLE V
REPRESENTATIONS AND WARRANTIES OF BUYER
Buyer represents and warrants to each of the Shareholders, as of the
Signing Date (unless a different date is specified within a particular section),
subject to such exceptions as are specifically disclosed in Schedule 5 (with
reference to the appropriate section number (the "Buyer Disclosure Schedule"),
as follows:
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5.1 Organization and Standing; Articles and Bylaws. Each of Buyer and
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Buyer Subsidiary is a corporation duly organized and existing under, and by
virtue of, the Laws of its jurisdiction of organization and is in good standing
under such Laws. Buyer and Buyer Subsidiary have requisite corporate power and
authority to own and operate their respective properties and assets and to carry
on their businesses as presently conducted and as proposed to be conducted.
Buyer and Buyer Subsidiary are not currently qualified to do business as a
foreign corporation in any jurisdiction, and the failure to be so qualified will
not have a Material Adverse Effect on Buyer or Buyer Subsidiary's businesses as
now conducted or as now proposed to be conducted. Buyer has made available to
each Shareholder copies of its Restated Articles and Bylaws, each as amended to
date.
5.2 Corporate Power. Buyer has all requisite legal and corporate power and
---------------
authority to execute and deliver this Agreement, the Warrants, and the Related
Agreements, to sell and issue the Series E Preferred Shares and the Warrants
hereunder, to issue the Warrant Shares and the Common Stock issuable upon
conversion of such Series E Preferred Shares and to carry out and perform its
obligations under the terms of this Agreement, the Warrants and the Related
Agreements.
5.3 Subsidiaries. Except for MicroTune International ("Buyer Subsidiary")
------------
and as set forth in Section 5.3 of the Buyer Disclosure Schedule, Buyer does not
otherwise own or control, directly or indirectly, any equity interest in any
corporation, association or business entity.
5.4 Capitalization.
--------------
(a) As of the Signing Date and immediately prior to the Closing, the
authorized capital stock of Buyer consists of 100,000,000 shares of Common
Stock, 3,971,434 shares of which are issued and outstanding, and 18,998,513
shares of Preferred Stock, 5,000,000 of which have been designated Series A
Preferred Stock, 4,000,001 of which are outstanding; 1,250,000 of which have
been designated Series B Preferred Stock, 1,000,000 of which are outstanding;
1,500,000 of which have been designated Series C Preferred Stock, 1,462,666 of
which are outstanding; 2,600,000 of which have been designated Series D
Preferred Stock, 1,367,418 of which are outstanding; 3,648,513 of which have
been designated Series E Preferred, none of which are outstanding; and 5,000,000
of which have not been designated, none of which are outstanding. The
outstanding shares have been duly authorized and validly issued, and are fully
paid and nonassessable. Buyer has reserved 3,318,513 shares of Series E
Preferred Stock and 1,106,171 shares of Common Stock for issuance hereunder and
under the Warrants, and 3,648,513 shares of Common Stock for issuance upon
conversion of the Series E Preferred Shares. The Series E Preferred Shares shall
have the rights, preferences, privileges and restrictions set forth in the
Restated Articles. Except as set forth in Section 5.4 of the Buyer Disclosure
Schedule, there are no outstanding securities, rights (preemptive or other),
subscriptions, calls, warrants, options, or other agreements (except for this
Agreement, the Related Agreements, and the Warrants) that give any Person the
right to purchase, subscribe for, or otherwise receive or be issued any shares
of capital stock of the Buyer or Buyer Subsidiary or any security convertible
into or exchangeable or exercisable for any shares of capital stock of Buyer or
Buyer Subsidiary, except that (i) Buyer has issued to a warrant exercisable for
40,698 shares of
-10-
Series A Preferred, exercisable upon liquidation, dissolution, or winding up of
Buyer, (ii) as of the Signing Date, there are 6,933,925 shares of Common Stock
reserved for issuance under Buyer's Amended and Restated 1996 Stock Option Plan,
a copy of which is attached hereto as Exhibit F ("Restated Buyer Stock Plan"),
----------
of which 3,475,633 are subject to outstanding options, of which options to
purchase 2,003,100 shares of Common Stock are contingent upon the consummation
of the transactions contemplated hereby, and (iii) Buyer has granted options,
which options are contingent upon the consummation of the transactions
contemplated hereby, exercisable for an aggregate of 330,000 shares of Series E
Preferred Stock at an exercise price of $16.00 per share to three employees of
Temic Telefunken Hochfrequenztechnik GmbH.
(b) The outstanding shares of capital stock of Buyer Subsidiary have
been duly authorized and validly issued, and are fully paid and nonassessable,
and are owned by Buyer.
5.5 Authorization. All corporate action on the part of Buyer, its
-------------
directors and its shareholders necessary for the authorization, execution,
delivery and performance of this Agreement, the Warrants and the Related
Agreements by Buyer, the authorization, sale, issuance and delivery of the
Series E Preferred Shares (and the Common Stock issuable upon conversion of the
Series E Preferred Shares) and the Warrants (and the Warrant Shares issuable
upon exercise of the Warrants), and the performance of all of Buyer's
obligations hereunder and thereunder has been taken. This Agreement, the
Warrants and the Related Agreements shall (assuming the due authorization,
execution, and delivery hereof and thereof by the other parties hereto and
thereto) constitute valid and binding obligations of Buyer, enforceable against
Buyer in accordance with their terms, subject to laws of general application
relating to bankruptcy, insolvency and the relief of debtors and rules of law
governing specific performance, injunctive relief or other equitable remedies.
The Series E Preferred Shares, when issued in compliance with the provisions of
this Agreement and the Warrants, will be validly issued, fully paid and
nonassessable; the Common Stock issuable upon conversion of the Series E
Preferred Shares and the Warrant Shares upon exercise of the Warrants have been
duly and validly reserved and, when issued in compliance with the provisions of
this Agreement, the Warrants (if applicable) and the Restated Articles, will be
validly issued, fully paid and nonassessable; and the Series E Preferred Shares
and Warrant Shares will be free of any Liens, other than any Liens created by or
imposed upon the holders; provided, however, that the Series E Preferred Shares
(and the Common Stock issuable upon conversion thereof) the Warrants and the
Warrant Shares may be subject to restrictions on transfer under state and/or
federal securities Laws and restrictions as set forth herein and in the
Registration Rights Agreement, the Co-Sale and Right of First Refusal Agreement
and the Voting Agreement. The issuance of the Series E Preferred Shares, the
Common Stock issuable upon conversion of the Series E Preferred Shares, the
Warrants and the Warrant Shares are not subject to any preemptive rights or
rights of first refusal.
5.6 Material Liabilities. Neither Buyer nor Buyer Subsidiary has any
--------------------
material liabilities or obligations, absolute or contingent (individually or in
the aggregate), except (i) liabilities and obligations which have been incurred
in the ordinary course of business and which have not had, either in any case or
in the aggregate, a Material Adverse Effect on Buyer on a consolidated basis,
(ii) liabilities and obligations under a lease for its principal offices and
leases for equipment, and
-11-
liabilities and obligations under sales, procurement and other contracts and
arrangements entered into in the normal course of business, and (iii)
liabilities and obligations which have been incurred as a result of the
Intellectual Property Assignment between Buyer, Cirrus Logic, Inc. and Cirrus
Logic International, Ltd. dated August 21, 1996 (the "IP Assignment").
5.7 Title to Properties and Assets; Liens, etc. Each of Buyer and Buyer
------------------------------------------
Subsidiary has good title to its properties and assets, and has good title to
all of its respective leasehold interests, in each case subject to no Lien other
than (i) the Lien of current Taxes not yet due and payable, and (ii) possible
minor Liens which do not in any case materially detract from the value of the
property subject thereto or materially impair the operations of Buyer on a
consolidated basis, and which have not arisen otherwise than in the ordinary
course of business.
5.8 Compliance with Laws; No Conflicts.
----------------------------------
(a) Each of Buyer and Buyer Subsidiary has complied with each Law
binding on such entity or any of its assets or properties and neither Buyer nor
Buyer Subsidiary is currently in violation of any of the foregoing, except for
such failures to comply or violations as would not have a Material Adverse
Effect on Buyer, on a consolidated basis.
(b) The execution, delivery and performance of and compliance with
this Agreement, the Related Agreements and the Warrants, and the issuance of the
Series E Preferred Shares and the Common Stock issuable upon conversion of the
Series E Preferred Shares and the Warrant Shares issuable upon exercise of the
Warrants, will not: (i) conflict with the Restated Articles or bylaws of Buyer
or any charter documents of Buyer Subsidiary; (ii) conflict with, or result in
any violation of, or constitute a default (with or without notice, lapse of
time, or both) under, or give rise to a right of termination, cancellation, or
acceleration of any obligation or to loss of benefit under, any material
mortgage, indenture, lease, contract, or other agreement or instrument, permit,
or license to which Buyer or Buyer Subsidiary is a party or by which any of
their assets are bound; (iii) constitute a material violation of any Law
applicable to Buyer or Buyer Subsidiary or their properties or assets; or (iv)
result in the creation of any Lien upon any of their assets; and there is no
such violation or default which will have a Material Adverse Effect on Buyer on
a consolidated basis or any of its properties or assets; and there is no such
violation or default which will have a Material Adverse Effect on Buyer on a
consolidated basis or any of its respective properties or assets.
5.9 Patents and Trademarks. To Buyer's knowledge, Buyer and Buyer
----------------------
Subsidiary own or possess sufficient legal rights to all patents, trademarks,
service marks, trade names, copyrights, trade secrets, information and other
proprietary rights and processes necessary for their respective business as now
conducted and as proposed to be conducted, without any known infringement of the
rights of others. Except as set forth in the IP Assignment and Section 5.9 of
the Buyer Disclosure Schedule, there are no outstanding options, licenses or
agreements of any kind relating to the foregoing, nor is Buyer or Buyer
Subsidiary bound by or a party to any options, licenses or agreements of any
kind with respect to the patents, trademarks, service marks, trade names,
-12-
copyrights, trade secrets, licenses, information and other proprietary rights
and processes of any other Person other than such licenses or agreements arising
from the purchase of "off the shelf" or standard products. Neither Buyer nor
Buyer Subsidiary has received any communications alleging that Buyer or Buyer
Subsidiary has violated or, by conducting its business as proposed, would
violate any of the patents, trademarks, service marks, trade names, copyrights
or trade secrets or other proprietary rights of any other Person.
5.10 Litigation, etc. There are no actions, suits, proceedings or
---------------
investigations pending against Buyer or Buyer Subsidiary or their respective
properties before any Governmental Entity (nor, to Buyer's knowledge, is there
any reasonable basis therefor or threat thereof).
5.11 Employees. To the Buyer's knowledge, no employee of Buyer or Buyer
---------
Subsidiary is in violation of any term of any employment contract, patent
disclosure agreement or any other contract or agreement relating to the
relationship of such employee with Buyer or Buyer Subsidiary or any other Person
because of the nature of the business conducted or to be conducted by Buyer or
Buyer Subsidiary. Except as set forth in Section 5.11 of the Buyer Disclosure
Schedule, each employee or consultant of Buyer and Buyer Subsidiary with access
to confidential or proprietary information has executed a Confidential
Information and Invention Assignment Agreement with Buyer or Buyer Subsidiary.
5.12 Registration Rights and Voting Agreements. Except as set forth in the
-----------------------------------------
Registration Rights Agreement, Buyer is not under any contractual obligation to
register (as defined in that Agreement) any of its currently outstanding
securities or any of its securities which may hereafter be issued. To Buyer's
knowledge, except as contemplated by the Voting Agreement, no shareholders of
Buyer have entered into any agreements with respect to the voting of capital
shares of Buyer.
5.13 Governmental Consents. No consent, approval or authorization of or
---------------------
designation, declaration or filing with any Governmental Entity on the part of
Buyer is required in connection with the valid execution and delivery of this
Agreement, the Warrants, or the Related Agreements, or the offer, sale or
issuance of the Series E Preferred Shares (and the Common Stock issuable upon
conversion of the Series E Preferred Shares), the Warrants or Warrant Shares, or
the consummation of any other transaction contemplated hereby or thereby, except
qualification (or taking such action as may be necessary to secure an exemption
from qualification, if available) of the offer and sale of the Series E
Preferred Shares (and the Common Stock issuable upon conversion of the Series E
Preferred Shares), the Warrants and the Warrant Shares under applicable blue sky
Laws, which filings and qualifications, if required, will be accomplished in a
timely manner.
5.14 Offering. Subject to the accuracy of each Shareholder's
--------
representations in Article IV hereof, the offer, sale and issuance of the Series
E Preferred Shares and the Warrants to be issued in conformity with the terms of
this Agreement, the issuance of the Warrant Shares upon exercise of the
Warrants, and the issuance of the shares of Common Stock to be issued upon
conversion of the Series E Preferred Shares, constitute transactions exempt from
the registration requirements of Section 5 of the Securities Act.
-13-
5.15 Brokers' and Finders' Fees. Neither Buyer nor Buyer Subsidiary has
--------------------------
incurred, nor will incur, directly or indirectly, as a result of any action
taken by Buyer or Buyer Subsidiary, any liability for brokerage or finders' fees
or agents' commissions or any similar charges in connection with this Agreement.
5.16 Disclosure. This Agreement with the Schedules hereto provided by
----------
Buyer with respect to Buyer, when taken as a whole, does not contain any untrue
statement of a material fact or omit to state a material fact necessary in order
to make the statements contained herein not misleading in the light of the
circumstances under which they were made.
5.17 No Conflict of Interest. Neither Buyer nor Buyer Subsidiary is
-----------------------
indebted, directly or indirectly, to any of its officers or directors or to
their respective spouses or children, in any amount whatsoever other than in
connection with expenses or advances of expenses incurred in the ordinary course
of business or relocation expenses of employees. None of Buyer's or Buyer
Subsidiary's officers or directors, or any members of their immediate families,
are, directly or indirectly, indebted to Buyer or Buyer Subsidiary (other than
in connection with purchases of Buyer's stock) or have any direct or indirect
ownership interest in any firm or corporation with which Buyer or Buyer
Subsidiary is affiliated or with which Buyer or Buyer Subsidiary has a business
relationship, or any firm or corporation which competes with Buyer or Buyer
Subsidiary except that officers, directors and/or shareholders of Buyer may own
stock in (but not exceeding five percent of the outstanding capital stock of)
any companies that may compete with or are associated with Buyer or Buyer
Subsidiary. None of Buyer's or Buyer Subsidiary's officers or directors or any
members of their immediate families have an interest in, directly or indirectly,
any material contract with Buyer or Buyer Subsidiary. Neither Buyer nor Buyer
Subsidiary is a guarantor or indemnitor of any indebtedness of any other Person.
5.18 Permits. Each of Buyer and Buyer Subsidiary has all permits, licenses
-------
and any similar authority necessary for the conduct of its business as now being
conducted by it, except for any such permits, licenses or authority the lack of
which would not have a Material Adverse Effect on Buyer, on a consolidated
basis. Neither Buyer nor Buyer Subsidiary is in default in any material respect
under any of such permits, licenses or other similar authority.
5.19 Agreements; Action. Except as set forth in Section 5.19 of the Buyer
------------------
Disclosure Schedule and for agreements explicitly contemplated by this Agreement
and the Related Agreements, there are no agreements, understandings or proposed
transactions between Buyer and any of its officers, directors, Affiliates, or
any affiliate thereof.
(a) Except for agreements explicitly referred to or contemplated by
this Agreement and the Related Agreements, there are no agreements,
understandings, instruments, contracts or proposed transactions to which Buyer
or Buyer Subsidiary is a party or by which it is bound that involve (i) the
license of any patent, copyright, trade secret or other proprietary right to or
from Buyer or Buyer Subsidiary, or (ii) the grant of rights to manufacture,
produce, assemble,
-14-
license, market, or sell its products to any other Person or affect Buyer's or
Buyer Subsidiary's exclusive right to develop, manufacture, assemble,
distribute, market or sell its products.
(b) Neither Buyer nor Buyer Subsidiary has (i) declared or paid any
dividends, or authorized or made any distribution upon or with respect to any
class or series of its capital stock, (ii) incurred any indebtedness for money
borrowed or incurred any other liabilities individually in excess of $500,000 or
in excess of $1,500,000 in the aggregate, (iii) made any loans or advances to
any Person, other than ordinary advances for travel expenses and in connection
with purchases of Buyer's stock, or (iv) sold, exchanged or otherwise disposed
of any of its assets or rights, other than the sale of its inventory in the
ordinary course of business.
(c) Neither Buyer nor Buyer Subsidiary is a party to or is bound by
any contract, agreement or instrument, or subject to any restriction under its
articles of incorporation or bylaws, that has a Material Adverse Effect on the
Buyer, on a consolidated basis.
(d) Buyer has not engaged in the past three (3) months in any
discussion (i) with any representative of any corporation or corporations
regarding the merger of Buyer with or into any such corporation or corporations,
(ii) with any representative of any corporation, partnership, association or
other business entity or any individual regarding the sale, conveyance or
disposition of all or substantially all of the assets of Buyer or a transaction
or seE, PLEDGrelated transactions in which more than fifty percent (50%) of the
voting power of Buyer would be disposed of, or (iii) regarding any other form of
liquidation, dissolution or winding up of Buyer.
5.20 Financial Statements.
--------------------
(a) Buyer has made available to each Shareholder its audited
financial statements (including balance sheet, income statement and statement of
cash flows) as of December 31, 1998 and for the fiscal year ended December 31,
1998 and its unaudited financial statements (including balance sheets and income
statements) as of March 31, 1999, June 30, 1999, and September 30, 1999, and for
the three-month periods ending March 31, 1999, June 30, 1999, and September 30,
1999 (collectively, the "Buyer Financial Statements"). The Buyer Financial
Statements have been prepared in accordance with U.S. GAAP applied on a
consistent basis throughout the periods indicated, except that the unaudited
Buyer Financial Statements may not contain all footnotes required by U.S. GAAP.
The Buyer Financial Statements fairly present the financial condition and
operating results of Buyer as of the dates, and for the periods, indicated
therein, subject to normal year-end audit adjustments.
(b) Except as set forth in the Buyer Financial Statements, Buyer has
no material liabilities, contingent or otherwise, other than (i) liabilities
incurred in the ordinary course of business subsequent to December 31, 1998 and
(ii) obligations under contracts and commitments incurred in the ordinary course
of business and not required under U.S. GAAP to be reflected in the Buyer
Financial Statements, which, in both cases, individually or in the aggregate are
not material to
-15-
the financial condition or operating results of Buyer. Except as disclosed in
the Buyer Financial Statements, Buyer is not a guarantor or indemnitor or of any
indebtedness of any other Person.
5.21 Changes. Except as set forth in Section 5.21 of the Buyer Disclosure
-------
Schedule, since September 30, 1999 there has not been:
(a) any change in the assets, liabilities, financial condition or
operating results of Buyer from that reflected in the Buyer Financial
Statements, except changes in the ordinary course of business that have not had
a Material Adverse Effect on Buyer on a consolidated basis;
(b) any material damage, destruction or loss, whether or not covered
by insurance, which has had a Material Adverse Effect on Buyer on a consolidated
basis;
(c) any waiver or compromise by Buyer or Buyer Subsidiary of a
valuable right or of a material debt owed to Buyer or Buyer Subsidiary;
(d) any satisfaction or discharge of any material Lien, or payment of
any obligation by Buyer or Buyer Subsidiary, except for those in the ordinary
course of business and which have not had a Material Adverse Effect on Buyer, on
a consolidated basis;
(e) any material adverse change to a material contract or agreement
by which Buyer or Buyer Subsidiary, or any of their respective assets is bound
or subject;
(f) any material change in any compensation arrangement or agreement
with any key employee, officer, director or shareholder of Buyer or Buyer
Subsidiary;
(g) any sale, assignment or transfer of any patents, trademarks,
copyrights, trade secrets or other intangible assets owned or used by Buyer or
Buyer Subsidiary;
(h) receipt of notice that there has been a material loss of, or
material order cancellation by, any major customer of Buyer or Buyer Subsidiary;
(i) any material mortgage, pledge, transfer of a security interest
in, or Lien, created by Buyer or Buyer Subsidiary, with respect to any of their
respective material properties or assets, except Liens for Taxes not yet due or
payable;
(j) any loans or guarantees made by Buyer or Buyer Subsidiary to or
for the benefit of their respective employees, officers or directors, or any
members of their immediate families, other than travel advances and other
advances made in the ordinary course of their respective businesses and other
than in connection with purchases of Buyer's capital stock;
(k) any declaration, setting aside or payment or other distribution
in respect to any of Buyer's capital stock, or any direct or indirect
redemption, purchase, or other acquisition of any of such stock by Buyer; or
-16-
(l) to the Buyer's knowledge, any other event or condition of any
character that might result in a Material Adverse Effect on Buyer on a
consolidated basis.
5.22 Employee Benefit Plans. Except as set forth in Section 5.22 of the
----------------------
Buyer Disclosure Schedule, neither Buyer nor Buyer Subsidiary has any Employee
Benefit Plan as defined in the Employee Retirement Income Security Act of 1974.
5.23 Tax Returns and Payments. Each of Buyer and Buyer Subsidiary has
------------------------
filed all Tax returns and reports as required by Law. These returns and reports
are true and correct in all material respects. Each of Buyer and Buyer
Subsidiary has paid all Taxes and other assessments due except for Taxes
incurred in the ordinary course of business not yet due and payable.
5.24 Insurance. Each of Buyer and Buyer Subsidiary has in full force and
--------
effect fire and casualty insurance policies, with extended coverage, sufficient
in amount (subject to reasonable deductibles) to allow Buyer or Buyer Subsidiary
to replace any of their respective properties that might be damaged or
destroyed.
5.25 Labor Agreements and Actions. Neither Buyer nor Buyer Subsidiary is
----------------------------
bound by or subject to (and none of their respective assets or properties is
bound by or subject to) any written or oral, express or implied, contract,
commitment or arrangement with any labor union, and no labor union has requested
or, to the knowledge of Buyer, has sought to represent any of the employees,
representatives or agents of Buyer or Buyer Subsidiary. There is no strike or
other labor dispute involving Buyer or Buyer Subsidiary pending, or to the
knowledge of Buyer threatened, which could have a Material Adverse Effect on
Buyer or Buyer Subsidiary, nor is Buyer aware of any labor organization activity
involving its employees or the employees of Buyer Subsidiary. Except as set
forth in Section 5.25 of the Buyer Disclosure Schedule, the employment of each
officer and employee of Buyer and Buyer Subsidiary is terminable at the will of
Buyer or Buyer Subsidiary, as the case may be. To Buyer's knowledge, each of
Buyer and Buyer Subsidiary has complied in all material respects with all
applicable state and federal equal employment opportunity Laws and with other
Laws related to employment.
5.26 Environmental and Safety Laws. Neither Buyer nor Buyer Subsidiary is
-----------------------------
in violation of any applicable Law relating to the environment or occupational
health and safety, except for such violations that would not have a Material
Adverse Effect on Buyer, on a consolidated basis, and to the best of Buyer's
knowledge, no material expenditures are or will be required in order to comply
with any such existing Law. No Hazardous Materials are used or have been used,
stored, or disposed of by Buyer or Buyer Subsidiary or to the best of Buyer's
knowledge after reasonable investigation, by any other Person on any property
owned, leased or used by Buyer or Buyer Subsidiary.
5.27 Year 2000 Matters. All of Buyer's and Buyer Subsidiary's software
products, devices and programs will operate prior to, during and after the
calendar year 2000 A.D. without material error relating to the date data that
represents or references different centuries or more than one
-17-
century other than such errors which have not had nor would reasonably be
expected to have, individually or in the aggregate, a Material Adverse Effect on
Buyer, on a consolidated basis.
5.28 Investment Company Act. Buyer is not an "investment company" or, to
----------------------
Buyer's knowledge, a company "controlled" by an "investment company" within the
meaning of the 1940 Act.
5.29 HSR Act. Buyer has neither annual net sales nor total assets of
-------
$10,000,000 or more as of September 30, 1999 (the date of Buyer's most recent
regularly prepared balance sheet).
ARTICLE VI
ADDITIONAL AGREEMENTS
6.1 Reincorporation into Delaware. In connection with the first meeting
-----------------------------
of the shareholders of Buyer following the Closing, Buyer shall use all
commercially reasonable efforts to effect a reincorporation into Delaware (the
"Reincorporation"), including soliciting the affirmative vote of the
shareholders of Buyer in respect of the Reincorporation and obtaining all
necessary consents and approvals of third parties to effect the Reincorporation.
Upon the effectiveness of the Reincorporation, the resulting Delaware
corporation shall assume all of the obligations of Buyer under this Agreement
and the Related Agreements as if such Delaware corporation were a party to this
Agreement and the Related Agreements.
6.2 Expenses. Except as contemplated in Section 3.2, all fees and
--------
expenses incurred in connection with the Acquisition including all legal,
accounting, financial advisory, consulting and all other fees and expenses of
third parties incurred by a party in connection with the negotiation and
effectuation of the terms and conditions of this Agreement and the transactions
contemplated hereby, shall be the obligation of the respective party incurring
such fees and expenses.
6.3 Public Disclosure. Buyer, on the one hand, and HMTF, acting on behalf
-----------------
of all Shareholders, on the other hand, will consult with the other before
issuing, and will provide the other with a reasonable opportunity to review and
comment upon, any press release or other public statements in respect of the
transactions contemplated by this Agreement, and shall not issue any such press
release or make any such public statement prior to such consultation except as
may be required by applicable Law or judicial process.
6.4 Stock Option Grants. Effective upon the Closing, Buyer has granted to
-------------------
certain employees of Temic and Buyer options or warrants to purchase shares of
Common Stock or Preferred Stock of Buyer on such terms as set forth in a
schedule previously reviewed and mutually agreed upon by Buyer and HMTF, as
evidenced by their signatures hereto.
-18-
6.5 Financial Information.
---------------------
(a) Periodic Reports. So long as a Shareholder (together with its
----------------
Affiliates is a holder of at least 250,000 shares of Series E Preferred Stock
and/or Common Stock issuable upon conversion of the Series E Preferred Shares
and/or Common Stock issuable upon conversion of the Series D Preferred Stock
and/or Warrant Shares (in each case as adjusted for stock splits, dividends,
combinations, recapitalizations or the like), upon prior written request by such
Shareholder Buyer will distribute the following reports to that Shareholder:
(i) As soon as practicable after the end of each fiscal year of
Buyer, and in any event within 90 days thereafter, consolidated balance sheets
of Buyer and its Subsidiaries, if any, as of the end of such fiscal year, and
consolidated statements of income and consolidated statements of cash flows of
Buyer and its Subsidiaries, if any, for such year, prepared in accordance with
U.S. GAAP and setting forth in each case in comparative form the figures for the
previous fiscal year (or, at the election of Buyer, setting forth in comparative
form the budgeted figures for the fiscal year then reported), all in reasonable
detail and audited by independent public accountants of national standing
selected by Buyer.
(ii) As soon as practicable after the end of the first, second
and third quarterly accounting periods in each fiscal year of Buyer and in any
event within 45 days thereafter, a consolidated balance sheet of Buyer and its
Subsidiaries, if any, as of the end of each such quarterly period, and
consolidated statements of income and consolidated statements of cash flows of
Buyer and its Subsidiaries, if any, for such period and for the current fiscal
year to date, prepared in accordance with U.S. GAAP (other than for accompanying
notes), subject to changes resulting from year-end audit adjustments, all in
reasonable detail and signed by the principal financial or accounting officer of
Buyer; provided, however, that Buyer shall, from time to time and at its sole
discretion, limit or prohibit the right of any Shareholder to receive such
information pursuant to this Section 6.5 if Buyer, in good faith, determines
that such information is a trade secret or contains confidential or classified
information.
(b) Assignment of Rights to Financial Information. The rights granted
---------------------------------------------
pursuant to this Section 6.5 may not be assigned or otherwise conveyed by any
Shareholder or by any subsequent transferee of any such rights without the prior
written consent of Buyer; provided, however, that any Shareholder may assign to
any transferee, other than a competitor of Buyer, and after giving notice to
Buyer, the rights granted pursuant to this Section 6.5 to (i) a transferee
(together with its Affiliates) who acquires at least 250,000 shares of Series E
Preferred Stock and/or Common Stock issued upon conversion of the Series E
Preferred Stock and/or Common Stock issuable upon conversion of the Series D
Preferred Stock and/or Warrant Shares (in each case as appropriately adjusted
for stock splits, dividends, combinations, recapitalizations or the like) or
Warrant Shares or (ii) immediate family members, trusts or partnerships for the
benefit of a Shareholder or his immediate family members, or charitable trusts
of foundations established by the Shareholder.
-19-
6.6 Change of Name. Upon the request, and at the expense, of the HM
--------------
Shareholders, Buyer shall change or cause the change of the name of each of the
Company and each New Company Subsidiary so that "HMTF" is deleted from name of
each of the Company and each New Company Subsidiary.
ARTICLE VII
DOCUMENTS DELIVERED AT THE CLOSING
7.1 Documents Delivered by the Shareholders at Closing. On the Signing
--------------------------------------------------
Date, the Shareholders (except as otherwise expressly provided below) are
delivering to Buyer each of the following documents:
(a) Certificates Evidencing the Company Shares. Certificates
------------------------------------------
evidencing the Company Shares accompanied by stock powers or other instruments
of transfer (in form and substance reasonably satisfactory to Buyer) duly
executed in blank, and such other documents and instruments of transfer as Buyer
may reasonably request conveying and transferring title of the Company Shares to
Buyer.
(b) Related Agreements. Copies of each of the following documents
------------------
duly executed by each such Shareholder: (i) the Registration Rights Agreement,
(ii) the Co-Sale and Right of First Refusal Agreement, and (iii) the Voting
Agreement.
(c) Monitoring and Oversight Agreement. Solely in respect of the HM
----------------------------------
Shareholders, a copy of the Monitoring and Oversight Agreement duly executed by
Xxxxx, Muse & Co. Partners, L.P.
(d) Resignation of Officers and Directors. Evidence that each officer
------------------------------------
and director of the Company and each New Company Subsidiary has resigned from
such positions with the Company and each New Company Subsidiary.
(e) Termination of Certain Agreements. Evidence that each of the
following agreements has been terminated and has ceased to have any force or
effect: (i) the Temic Shareholders Agreement, (ii) Temic Monitoring and
Oversight Agreement, and (iii) the Temic Financial Advisory Agreement.
(f) Pledge Agreement and Pledged Shares. Pledge agreement and related
----------------------------------
stock powers and assignment agreements, all in the form attached hereto as
Exhibit L, duly executed by the Company and TIN.
---------
(g) Officer's Certificate. An officer's certificate duly executed by
an officer of the Company and a director of each New Company Subsidiary
certifying (as applicable) that (i) the certificate of incorporation and
memorandum of association of the Company and such other similar organizational
documents of each New Company Subsidiary in each case as attached thereto are
true,
-20-
correct, and complete and (ii) the Bye-Laws of the Company and such other
similar governance documents of each New Company Subsidiary in each case as
attached thereto are true, correct, and complete.
(h) Legal Opinions. Legal opinions from Xxxxxxx Xxxxxxxx & Xxxxx,
--------------
Bermuda counsel, in the form attached hereto as Exhibit H, Hunter & Hunter, in
---------
the form attached hereto as Exhibit I, and Bruckhaus Xxxxxxxx Xxxxxx Xxxxx, in
---------
the form attached hereto as Exhibit J.
---------
(i) Noncompete Agreement. Noncompete agreement in a form reasonably
--------------------
satisfactory to the Buyer, duly executed by the employees listed in Schedule
7.1(i).
(j) Third-Party Consents. All necessary consents of, filings with,
--------------------
any Government Entity or third Person, relating to the consummation by each
Shareholder of the transactions contemplated hereby.
7.2 Documents Delivered by Buyer at Closing. On the Signing Date, Buyer is
---------------------------------------
delivering to the Shareholders each of the following documents:
(a) Certificates Evidencing Preferred Shares. In respect of each
----------------------------------------
Shareholder, a certificate in the name of such Shareholder evidencing the
Preferred Shares acquired by such Shareholder as set forth opposite such
Shareholder's name on Schedule 1.3.
(b) Warrants. In respect of each Shareholder, an original Warrant
showing such Shareholder as the holder thereof and evidencing the right to
acquire the number of Warrant Shares set forth opposite such Shareholder's name
on Schedule 1.3 duly executed by Buyer.
(c) Related Agreements. Copies of each of the following documents
------------------
duly executed by each of Buyer and such persons necessary to amend and restate
such agreement (other than the Shareholders): (i) the Registration Rights
Agreement, (ii) the Co-Sale and Right of First Refusal Agreement, (iii) the
Voting Agreement.
(d) Monitoring and Oversight Agreement. A copy of the Monitoring and
----------------------------------
Oversight Agreement duly executed by Buyer.
(e) Restated Articles. A copy of the Restated Articles certified by
-----------------
the Secretary of State of the State of Texas effective as of a date not more
than five days prior to the Effective Date.
(f) Officer's Certificate. An officer's certificate duly executed by
---------------------
the secretary of Buyer certifying that (i) the Restated Articles are true,
correct, and complete, (ii) the bylaws of the Company as attached thereto are
true, correct, and complete, (iii) the resolutions of the board of directors of
Buyer approving (A) the execution and delivery of this Agreement, the Related
Agreements, the Warrants, and each of the other documents delivered by Buyer
pursuant hereto and authorizing the consummation of the transactions
contemplated hereby and thereby, (B) the Restated
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Articles, (C) the Restated Buyer Stock Plan, and (D) the increase in the number
of directors on Buyer's board of directors from seven directors to ten
directors, and (iv) the resolutions of the requisite number of shareholders of
Buyer approving (A) the Restated Articles, (B) the Restated Buyer Stock Plan and
(C) electing Xxxxxx Xxxxxxxxx, Xxxxxxxx X. Xxxxxx, Xx. and Xxxxxxxx xxx
Xxxxxxxxxxxx to Buyer's Board of Directors.
(g) Third-Party Consents. Any and all approvals, authorizations,
--------------------
consents, orders, and waivers of any Governmental Entity or third party that are
required in connection with the consummation of the transactions contemplated by
this Agreement or any Related Agreement.
(h) Legal Opinion. Legal opinion from Xxxxxx Xxxxxxx Xxxxxxxx &
-------------
Xxxxxx, counsel to Buyer, in the form attached hereto as Exhibit K.
---------
ARTICLE VIII
SURVIVAL OF REPRESENTATIONS AND WARRANTIES,
INDEMNIFICATION
8.1 Survival of Representations and Warranties.
-----------------------------------------
(a) Except as to the representations and warranties contained in
Section 2.1 (organization and standing; articles and bylaws), Section 2.2(b)
(governmental consents), Section 2.8 (brokers' and finders' fees), and Section
2.3 (capitalization), which shall survive the Closing and remain in effect
indefinitely, the representations and warranties of the HM Shareholders
contained in this Agreement shall not survive the Closing.
(b) Except as to the representations and warranties contained in
Section 4.1 (power, consents and authorization), Section 4.2 (title to
securities), and Section 4.5 (investment representations), which shall survive
the Closing and remain in effect indefinitely, the representations and
warranties of the Shareholders contained in this Agreement shall not survive the
Closing.
(c) Except as to the representations and warranties contained in
Section 5.1 (organization and standing; articles and bylaws), Section 5.2
(power), Section 5.3 (authorization), Section 5.4 (capitalization), Section 5.13
(governmental consents), and Section 5.15 (brokers' and finders' fees), which
shall survive the Closing and remain in effect indefinitely, the representations
and warranties of Buyer contained in this Agreement shall not survive the
Closing.
(d) The covenants in this Agreement shall survive the Closing and
remain in effect indefinitely, unless any such covenant provides that it will
survive for a different period after the Closing (in which event such different
period shall apply).
8.2 Indemnification.
---------------
-22-
(a) Subject to Section 8.1, each Shareholder severally but not
jointly, shall indemnify and hold harmless Buyer and its officers, directors,
agents, and Affiliates from and against any and all Indemnifiable Losses to the
extent relating to, resulting from, or arising out of:
(i) any inaccuracy or breach of any representation or warranty
of such Shareholder contained herein; and
(ii) any breach or nonfulfillment of any agreement or covenant of
such Shareholder under this Agreement.
(b) Subject to Section 8.1, Buyer shall indemnify and hold harmless
each Shareholder and its officers, directors, agents, and Affiliates from and
against any and all Indemnifiable Losses to the extent relating to, resulting
from, or arising out of:
(i) any inaccuracy or breach of any representation or warranty
of Buyer contained herein; and
(ii) any breach or nonfulfillment of any agreement or covenant of
Buyer under this Agreement.
8.3 Third-Party Claims.
------------------
(a) If any Indemnified Party receives notice of assertion or
commencement of any Third Party Claim against such Indemnified Party in respect
of which an Indemnifying Party is obligated to provide indemnification under
this Agreement, the Indemnified Party will give such Indemnifying Party
reasonably prompt written notice thereof, but in any event not later than 15
calendar days after receipt of such notice of such Third Party Claim. Such
notice will describe the Third Party Claim in reasonable detail, will include
copies of all material written evidence thereof and will indicate the estimated
amount, if reasonably practicable, of the Indemnifiable Loss that has been or
may be sustained by the Indemnified Party. The Indemnifying Party will have the
right to participate in, or, by giving written notice to the Indemnified Party,
to assume, the defense of any Third Party Claim at such Indemnifying Party's own
expense and by such Indemnifying Party's own counsel (reasonably satisfactory to
the Indemnified Party), and the Indemnified Party will cooperate in good faith
in such defense.
(b) If, within ten calendar days after giving notice of a Third Party
Claim to an Indemnifying Party pursuant to Section 8.3(a), an Indemnified Party
receives written notice from the Indemnifying Party that the Indemnifying Party
has elected to assume the defense of such Third Party Claim as provided in the
last sentence of Section 8.3(a), the Indemnifying Party will not be liable for
any legal expenses subsequently incurred by the Indemnified Party in connection
with the defense thereof; provided, however, that if the Indemnifying Party
fails to take reasonable steps necessary to defend diligently such Third Party
Claim within ten calendar days after receiving written notice from the
Indemnified Party that the Indemnified Party believes the Indemnifying Party
-23-
has failed to take such steps or if the Indemnifying Party has not undertaken
fully to indemnify the Indemnified Party in respect of all Indemnifiable Losses
relating to the matter, the Indemnified Party may assume its own defense, and
the Indemnifying Party will be liable for all reasonable costs or expenses paid
or incurred in connection therewith. Without the prior written consent of the
Indemnified Party, the Indemnifying Party will not enter into any settlement of
any Third Party Claim which would lead to liability or create any financial or
other obligation on the part of the Indemnified Party for which the Indemnified
Party is not entitled to indemnification hereunder.
(c) Direct Claims. The Indemnifying Party will have a period of 30
-------------
calendar days within which to respond in writing to any claim by an Indemnified
Party on account of an Indemnifiable Loss that does not result from a Third
Party Claim (a "Direct Claim"). If the Indemnifying Party does not so respond
within such 30 calendar day period, the Indemnifying Party will be deemed to
have rejected such claim, in which event the Indemnified Party will be free to
pursue such remedies as may be available to the Indemnified Party on the terms
and subject to the conditions of this Article VIII. In case the Indemnifying
Party shall so object in writing to any claim or claims made by Indemnified
Party hereunder, the Indemnifying Party and Indemnified Party shall attempt in
good faith to agree upon the rights of the respective parties with respect to
each of such claims.
(d) A failure to give timely notice or to include any specified
information in any notice as provided in this Section 8.3 will not affect the
rights or obligations of any party hereunder except and only to the extent that,
as a result of such failure, any Person which was entitled to receive such
notice was deprived of its right to recover any payment under its applicable
insurance coverage or was otherwise materially damaged as a result of such
failure.
(e) No Shareholder shall have any right of contribution from the
Company, Temic or any Subsidiary of the Company or Temic with respect to any
Indemnifiable Loss.
ARTICLE IX
GENERAL PROVISIONS
9.1 No Joint Venture. Nothing contained in this Agreement shall be deemed
----------------
or construed as creating a joint venture or partnership between or among any of
the parties. No party is by virtue of this Agreement authorized as an agent,
employee or legal representative of any other party. No party shall have the
power to control the activities and operations of any other and their status is,
and at all times will continue to be, that of independent contractors with
respect to each other. No party shall have any power or authority to bind or
commit any other.
9.2 Waiver. No delay or omission to exercise any right, power or remedy
------
accruing to any party hereto upon any breach or default of any other party under
this Agreement shall impair any such right, power or remedy, nor shall it be
construed to be a waiver of any such breach or default, or any acquiescence
therein, or of any similar breach or default thereafter occurring; nor shall any
-24-
waiver of any single breach or default be deemed a waiver of any other breach or
default theretofore or thereafter occurring. Any waiver, permit, consent or
approval of any kind or character of any breach or default under this Agreement,
or any waiver of any provisions or conditions of this Agreement must be set
forth in a written instrument duly executed and delivered on behalf of the
waiving party. Any such waiver shall not be applicable or have any effect except
in the specific instance in which it is given.
9.3 Notices. All notices and other communications hereunder shall be in
-------
writing and shall be deemed given if delivered personally or by commercial
delivery service, or mailed by registered or certified mail (return receipt
requested) or sent via facsimile (with acknowledgment of complete transmission)
to the parties at the following addresses or facsimile numbers (or at such other
address or facsimile number for a party as shall be specified by like notice):
(a) if to Buyer, to:
MicroTune, Inc.
0000 Xxxx Xxxxx Xxxxxxx, Xxxxx 000
Xxxxx, Xxxxx 00000
Attention: Chief Executive Officer
Telephone No.: (000) 000-0000
Facsimile No.: (000) 000-0000
with a copy to:
Xxxxxx Xxxxxxx Xxxxxxxx & Xxxxxx
8911 Capital of Xxxxx Xxxxxxx
Xxxxxxx 000, Xxxxx 0000
Xxxxxx, Xxxxx 00000-0000
Attention: Xxxx X. Xxxxxx, Esq.
Telephone No.: (000) 000-0000
Facsimile No.: (000) 000-0000
(b) if to the Shareholders, to their respective addresses set forth
on the signature pages to this Agreement, with a copy to each of:
Hicks, Muse, Xxxx & Xxxxx Incorporated
000 Xxxxxxxx Xxxxx, Xxxxx 0000
Xxxxxx, Xxxxx 00000
Attention: Xxxxxxxx X. Xxxxxx, Xx.
Telephone No.: (000) 000-0000
Facsimile No. (000) 000-0000
and
-25-
Weil, Gotshal & Xxxxxx LLP
000 Xxxxxxxx Xxxxx, Xxxxx 0000
Xxxxxx, Xxxxx 00000-0000
Attention: Xxxxx X. Xxxx
Telephone No.: (000) 000-0000
Facsimile No.: (000) 000-0000
9.4 Governing Law. This Agreement shall be governed by and construed in
-------------
accordance with the laws of the State of Texas applicable to contracts entered
into and wholly to be performed within Texas by Texas residents.
9.5 Entire Agreement. This Agreement, (including the Schedules hereto),
----------------
the Restated Articles, the Warrants, the Related Agreements, the Mutual
Disclosure Agreement dated September 28, 1999 between Buyer and Temic and the
Mutual Disclosure Agreement dated September 16, 1999 between Buyer and Hicks,
Muse, Xxxx & Xxxxx Incorporated constitute the full and entire understanding and
agreement among the parties hereto and thereto with regard to the subject matter
hereof and thereof and supersede all prior oral and written understandings and
agreements with regard to such subject matter.
9.6 Successors and Assigns. This Agreement shall be binding upon and inure
----------------------
to the benefit of the parties hereto and their respective heirs, legal
representatives, successors and permitted assigns, but shall not be assignable
or delegable without the prior written consent of each other party hereto;
provided, however, that any of the parties hereto may assign or delegate its
rights or obligations to any of its Affiliates; provided further, that any such
assignment shall not relieve any such party of its obligations hereunder. Any
purported assignment or delegation in violation of the foregoing shall be null
and void.
9.7 Severability. In the event that any provision of this Agreement or the
------------
application thereof shall be deemed or declared by a court of competent
jurisdiction to be illegal, void or unenforceable, (i) the remainder of this
Agreement will continue in full force and effect and the application of such
provision to other Persons or circumstances will be interpreted so as reasonably
to effect the intent of the parties hereto, and (ii) such void or unenforceable
provision shall be replaced with a valid and enforceable provision that will
achieve, to the extent possible, the economic, business and other purposes of
such void or unenforceable provision.
9.8 Further Assurances. The parties hereto shall execute such further
------------------
instruments and shall take such further action as may be reasonably requested by
another party hereto to carry out the purposes or intent of this Agreement and
the transactions contemplated hereby.
9.9 Other Remedies; Specific Performance. Except as otherwise provided
herein, any and all remedies herein expressly conferred upon a party will be
deemed cumulative with and not exclusive of any other remedy conferred hereby,
or by law or equity upon such party, and the exercise by a party of any one
remedy will not preclude the exercise of any other remedy. The
-26-
parties hereto agree that irreparable damage would occur in the event that any
of the provisions of this Agreement were not performed in accordance with their
specific terms or were otherwise breached. It is accordingly agreed that the
parties shall be entitled to an injunction or injunctions to prevent breaches of
this Agreement and to enforce specifically the terms and provisions hereof in
any court of having jurisdiction, this being in addition to any other remedy to
which they are entitled at law or in equity.
9.10 Interpretation; Titles and Subtitles. The words "include," "includes"
------------------------------------
and "including" when used herein shall be deemed in each case to be followed by
the words "without limitation." The table of contents and headings contained in
this Agreement are for reference purposes only and shall not affect in any way
the meaning or interpretation of this Agreement. The parties hereto agree that
they have been represented by counsel during the negotiation and execution of
this Agreement and, therefore, waive the application of any law, regulation,
holding or rule of construction providing that ambiguities in an agreement or
other document will be construed against the party drafting such agreement or
document.
9.11 Absence of Third Party Beneficiary Rights. No provision of this
-----------------------------------------
Agreement is intended, nor shall it be interpreted, to provide or create any
third party beneficiary rights or any other rights of any kind in any Person not
a party hereto unless specifically provided otherwise herein.
9.12 Language. The parties hereby acknowledge that it is their express
--------
desire that this Agreement be prepared in the English language.
9.13 Counterparts. This Agreement may be executed in any number of
------------
counterparts, each of which will be an original, but all of which together shall
be considered one and the same agreement.
9.14 No Recourse. No past, present, or future director, officer, employee,
-----------
shareholder, incorporator, or partner, as such, of Buyer, the Company, or the
Shareholders (except to the extent any of the foregoing is a party to this
Agreement) shall have any liability for any obligation of Buyer, the Company, or
the Shareholders under this Agreement or for any claim based on, in respect of,
or by reason of such obligations or their creation.
9.15 Definitions. The following terms when used herein have the meanings
-----------
set forth below:
"1940 Act" means the Investment Company Act of 1940, as amended.
"Affiliate" means, as to any Person, any other Person that, directly or
indirectly, through one or more intermediaries, controls, is controlled by, or
is under common control with, such other Person. For purposes of this
definition "control" means the possession of the power to direct or
-27-
cause the direction of the management and policies of such Person, whether
through the ownership of voting securities, by contract, or otherwise.
"Agreement" has the meaning set forth in the introductory paragraph.
"Acquisition" has the meaning set forth in the Recitals.
"Buyer" has the meaning set forth in the introductory paragraph.
"Buyer Disclosure Schedule" has the meaning set forth in the first
paragraph of Article V.
"Buyer Financial Statements" has the meaning set forth in Section 5.20.
"Buyer Subsidiary" has the meaning set forth in Section 5.3.
"Closing" and "Closing Date" have the respective meanings set forth in
Section 1.1.
"Common Stock" has the meaning set forth in Section 1.3.
"Company" has the meaning set forth in the introductory paragraph.
"Company Charter Documents" means the Memorandum and Articles of
Association of Company, each as amended through the date of this Agreement and
the organizational documents for each New Company Subsidiary.
"Company Disclosure Schedule" has the meaning set forth in the first
paragraph of Article II.
"Company Shares" has the meaning set forth in the Recitals.
"Co-Sale and Right of First Refusal Agreement" means the Fourth Amended and
Restated Co-Sale and Right of First Refusal Agreement dated as of even date
hereof by and among Buyer and the signatories thereto, in the form attached
hereto as Exhibit D.
---------
"Direct Claim" has the meaning set forth in Section 8.3(c)(i).
"Effective Date" has the meaning set forth in the introductory paragraph.
"Governmental Entity" shall mean any domestic or foreign national,
provincial, state, county, local or other legislative body, administrative
agency, authority, court, instrumentality, agency or commission.
"Hazardous Materials" means any chemicals, pollutants, contaminants,
wastes, toxic substances, hazardous substances, petroleum or petroleum products
or other substances the use, storage or disposal of which is subject to Law.
-28-
"HM Shareholders" means HTMF Temic/Microtune Cayman, L.P., a limited
partnership organized under the laws of the Cayman Islands and its successors.
"HMTF" means HMTF Temic/Microtune Cayman, L.P., a limited partnership
organized under the Laws of the Cayman Islands, and its successors.
"Indemnifiable Losses" means any and all damages, losses, liabilities,
obligations, costs, and expenses, and any and all claims, demands, or suits (by
any Person), including the costs and expenses of any and all actions, suits,
proceedings, demands, assessments, judgments, settlements, and compromises
relating thereto and including reasonable attorneys' fees and expenses in
connection therewith.
"Indemnifying Party" means any Person required to provide indemnification
under this Agreement.
"Indemnified Party" means any Person entitled to indemnification under this
Agreement.
"IP Assignment" has the meaning set forth in Section 5.6.
"Knowledge", "known" or words of similar import mean knowledge of the
directors, officers shareholders of the relevant company, including facts of
which the directors, officers and shareholders of the relevant company, in the
reasonably prudent exercise of their duties as directors, officers and/or
shareholders of the company should be aware.
"Law" or, collectively, "Laws", means any statute, law, rule, regulation,
ordinance, code, governmental policy, and any judicial or administrative
interpretation thereof including any judicial or administrative order, consent,
decree, or judgment.
"Lien" means any mortgage, pledge, lien, security interest, charge, claim,
equity, encumbrance, restriction on transfer, conditional sale or other title
retention device or arrangement (including a capital lease), transfer for the
purpose of subjection to the payment of any indebtedness, or restriction on the
creation of any of the foregoing, whether relating to any property or right or
the income or profits therefrom.
"Material Adverse Effect" on a Person means a material adverse effect on
the business (as conducted or proposed to be conducted), properties, prospects,
assets (including intangible assets), liabilities, financial condition or
results of operations of such party and its Subsidiaries considered as a single
enterprise.
"Monitoring and Oversight Agreement" means that certain Monitoring and
Oversight Agreement dated on even date hereof, in the form attached hereto as
Exhibit G.
---------
"New Company Subsidiaries" has the meaning set forth in Section 2.1.
-29-
"Non-U.S. Shareholder" has the meaning set forth in Section 4.5(d).
"Person" means an individual, a partnership, a limited liability company, a
corporation, an association, a joint stock company, a trust, a joint venture, an
unincorporated organization and a Governmental Entity.
"Registration Rights Agreement" means the Fourth Amended and Restated
Registration Rights Agreement dated on even date hereof by and among Buyer, the
Shareholders (as defined therein) and the Founders, in the form attached hereto
as Exhibit C.
---------
"Reincorporation" has the meaning set forth in Section 6.1.
"Related Agreements" means the Registration Rights Agreement, the Co-Sale
and Right of First Refusal Agreement and the Voting Agreement.
"Restated Articles" the Second Amended and Restated Articles of
Incorporation of Buyer, as corrected, in the form attached hereto as Exhibit B,
---------
as filed with the Secretary of State of Texas effective as of December 31, 1999.
"Restated Buyer Stock Plan" has the meaning set forth in Section 5.4(a).
"Securities" has the meaning set forth in Section 4.5(a).
"Securities Act" means the United States Securities Act of 1933, as
amended, including all rules and regulations promulgated thereunder, or any
successor law.
"Series D Preferred Stock" means the Company's Series D Preferred Stock,
par value $0.001 per share.
"Series E Preferred Shares" has the meaning set forth in Section 1.3(a).
"Series E Preferred Stock" has the meaning set forth in Section 1.3(a).
"Shareholder" or, collectively "Shareholders" has the meaning set forth in
the introductory paragraph.
"Shareholder Disclosure Schedule" has the meaning set forth in the first
paragraph of Article IV.
"Signing Date" has the meaning set forth in the introductory paragraph.
"Subsidiary" means any corporation, partnership, association or other
business entity of which (i) if a corporation, a majority of the total voting
power of shares of stock entitled (without regard to the occurrence of any
contingency) to vote in the election of directors, managers or trustees thereof
is at the time owned or controlled, directly or indirectly, by that Person or
one or more of the
-30-
other Subsidiaries of that Person or a combination thereof, or (ii) if a
partnership, association or other business entity, a majority of the partnership
or other similar ownership interest thereof is at the time owned or controlled,
directly or indirectly, by any Person or one or more Subsidiaries of that Person
or a combination thereof. For purposes hereof, a Person or Persons shall be
deemed to have a majority ownership interest in a partnership, association or
other business entity if such Person or Persons shall be allocated a majority of
partnership, association or other business entity gains or losses or shall be or
control the managing director or general partner of such partnership,
association or other business entity.
"Tax" or, collectively, "Taxes", means any and all national, provincial,
and local and foreign taxes, assessments and other governmental charges, duties,
impositions and liabilities, including taxes based upon or measured by gross
receipts, income, profits, sales, use and occupation, and value added, ad
valorem, transfer, franchise, withholding, payroll, recapture, employment,
excise and property taxes, together with all interest, penalties and additions
imposed with respect to such amounts and any obligations under any agreements or
arrangements with any other Person with respect to such amounts and including
any liability for taxes of a predecessor entity.
"Temic" has the meaning set forth in Section 3.1.
"Temic Disclosure Schedule" has the meaning set forth in the introductory
paragraph of Article III.
"Temic Financial Advisory Agreement" means that certain Financial Advisory
Agreement dated as of December 23, 1999, by and among Temic, its Subsidiaries
party thereto, and Xxxxx Muse & Co. Partners, L.P.
"Temic Monitoring and Oversight Agreement" means that certain Monitoring
and Oversight Agreement dated as of December 23, 1999, by and among Temic, its
Subsidiaries party thereto, and Xxxxx Muse & Co. Partners, L.P.
"Temic Purchase Agreement" has the meaning set forth in Section 3.1.
"Temic Shareholders Agreement" means that certain Shareholders Agreement
dated as of December 23, 1999, by and among HMTF Europe Fund Cayman L.P., the
Beneficiaries (as defined therein), TIN, and the Company.
"Third Party Claim" means a claim for Indemnifiable Losses made by any
Person who is not a signatory to this Agreement.
"TIN" means TIN Vermogensverwaltungsgellschaft mbH.
"U.S. GAAP" means United States generally accepted accounting principles.
"U.S. Person" has the meaning set forth in Section 4.5(d)(i).
-31-
"U.S. Shareholder" has the meaning set forth in Section 4.5(c).
"Voting Agreement" means the Fourth Amended and Restated Voting Agreement
dated on even date hereof by and among Buyer, in the form attached hereto as
Exhibit E.
---------
"Warrants" has the meaning set forth in Section 1.3(a).
"Warrant Shares" has the meaning set forth in Section 1.3(a).
-32-
IN WITNESS WHEREOF, the parties have caused this Agreement to be signed by
their duly authorized respective officers, all as of the date first written
above.
MICROTUNE, INC.
By: /s/ Xxxxxxx X. Xxxxxx
----------------------------------------
Name: Xxxxxxx X. Xxxxxx
--------------------------------------
Title: Chairman and Chief Executive Officer
-------------------------------------
SHAREHOLDERS:
TIN Verhogensverwaltungs Gesellschaft mbH
-----------------------------------------
[Print Name]
By: /s/ Xxxx Xxxxxx
--------------------------------------
Title: Geschafisfuhrer
-----------------------------------
Address:
---------------------------------
Koogskaat 10a
-----------------------------------------
25870 Norderfriedrickskoog
-----------------------------------------
