EXHIBIT 2.1
ASSET PURCHASE AND STOCK SALE AGREEMENT
This ASSET PURCHASE AND STOCK SALE AGREEMENT, including attached exhibits
and schedules, dated as of July 24, 2000 (the "Agreement"), by and among
Geoworks Corporation, a Delaware corporation ("Parent"), AirBoss Acquisition
Corporation, a New Jersey corporation and a wholly-owned subsidiary of Parent
("Purchaser"), and Telcordia Technologies, Inc., a Delaware corporation
("Seller").
WHEREAS, Seller, under the business names "AirBoss Business Unit" and
"AirBoss Wireless Solutions Business Unit," operates a software and wireless
technology services business as an established separate, but unincorporated,
division of Seller (the "Business");
WHEREAS, Purchaser and Seller have agreed to the acquisition by Purchaser
and the sale by Seller of substantially all of the assets of the Business and
the assumption by Purchaser of substantially all of the liabilities of Seller
which are related to the Business (the "Acquisition"), subject to the terms and
conditions of this Agreement; and
WHEREAS, Parent desires to issue to Seller, and Seller desires to acquire
from Parent, shares of Parent Common Stock aggregating 12% of the outstanding
shares of Parent Common Stock (the "Share Purchase").
NOW THEREFORE, in consideration of the foregoing and of the mutual
covenants, representations, warranties, and agreements herein contained, the
parties, intending to be legally bound hereby, agree as follows:
ARTICLE 1
THE ACQUISITION AND RELATED MATTERS
1.1. DEFINITIONS.
(a) "Acquired Assets" means the assets specifically identified in
SCHEDULE 1.1(A) hereto.
(b) "Assumed Contracts" means the proposals, planning estimates and
contracts specifically identified in SCHEDULE 1.1(B) hereto.
(c) "Assumed Liabilities" means the liabilities specifically
identified in SCHEDULE 1.1(C) HERETO.
(d) "Excluded Assets" means the all assets of Seller other than the
Acquired Assets.
(e) "Intellectual Property" means all (a) domestic or foreign
patents, patent applications, patent disclosures, improvements and licenses
thereto, (b) trademarks, service marks, trade dress, logos, trade names, and
corporate names and registrations and appli-
cations for registration thereof and licenses thereto, including, but not
limited to, the names "AirBoss", AirBrowse", and "AirForce," (c) copyrights and
registrations and applications for registration thereof and licenses thereto,
(d) mask works and registrations and applications for registration thereof and
licenses thereto, (e) computer software, source code, data, and documentation,
and any licenses for such software, data and documentation, (f) trade secrets
and confidential business information (including ideas, formulas, compositions,
inventions, whether patentable or unpatentable, and whether or not reduced to
practice, know-how, manufacturing and production processes and techniques,
research and development information, drawings, specifications, designs, plans,
proposals, technical data, copyrightable works, financial, marketing, and
business data, pricing, and cost information, business and marketing plans, and
customer and supplier lists and information), (g) other proprietary rights, and
(h) copies and tangible embodiments thereof (in whatever form or medium).
(f) "Liability" means any liability (whether known or unknown,
whether absolute or contingent, whether liquidated or unliquidated, and whether
due or to become due), including any liability for Taxes.
(g) "Ordinary Course of Business" (using initial capital letters or
otherwise) means the conduct of the Business by Seller in the ordinary course
consistent with past custom and practice (including relating to frequency and
quantities of orders and purchases, pricing, discounts and collection, and
employment practices).
(h) "Permitted Encumbrances" means the encumbrances specifically
identified in Schedule 1.1(i) hereto.
(i) "Subsidiary" means, when used with reference to any entity, any
corporation or other organization, whether incorporated or unincorporated, (i)
of which such party or any other subsidiary of such party is a general or
managing partner or (ii) the outstanding voting securities or interests of
which, having by their terms ordinary voting power to elect a majority of the
Board of Directors or others performing similar functions with respect to such
corporation or other organization, are directly or indirectly owned or
controlled by such party or by any one or more of its subsidiaries.
(j) "Tax" means any federal, state, local, or foreign net income,
gross income, gross receipts, license, payroll, employment, excise, severance,
stamp, occupation, premium, windfall profits, customs duties, capital stock,
franchise, profits, withholding, social security (or similar), unemployment,
disability, real property, personal property, sales, use, transfer,
registration, value added, alternative or add-on minimum, estimated, or other
tax of any kind whatsoever (whether or not specifically defined under the
Internal Revenue Code of 1986, as amended (the "Code")), including any interest,
penalty, fee, assessment, charge or addition thereto, whether disputed or not,
imposed by any taxing authority.
(k) Whenever a representation or warranty is made "to the knowledge"
of a party, such representation and warranty shall be deemed to have been made
based on
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the actual knowledge of any of the officers and directors of such party, and on
the knowledge that such party could have acquired had it conducted a reasonable
inquiry of the subject matter of the representation and warranty.
1.2. BASIC TRANSACTION.
(a) PURCHASE AND SALE OF ASSETS. On the Closing Date, Purchaser shall
purchase from Seller, and Seller shall sell, assign, transfer, convey, and
deliver to Purchaser, the Acquired Assets for the consideration specified in
this Section 1.2.
(b) ASSUMPTION OF LIABILITIES. Purchaser shall assume the Assumed
Contracts and Assumed Liabilities. Purchaser does not intend to assume, shall
not be deemed to have assumed, and shall not assume or have any responsibility,
for or in respect of any other obligation or Liability not included as or within
the definition of Assumed Contracts and Assumed Liabilities.
(c) PURCHASE PRICE. Parent shall deliver to the order of or for the
benefit of Seller a number of shares (the "Parent Shares") of common stock, par
value $.001 per share (the "Parent Common Stock"), equal to 12% of the issued
and outstanding shares of Parent Common Stock on a fully diluted basis after
giving effect to such issuance on the Closing Date (the "Purchase Price"). The
Purchase Price includes Sales or Use Taxes separately stated and computed at the
rates applicable to the location where taxable transfer and delivery of tangible
personal property occurs, as set forth in Section 1.3. The Purchase Price
including separately stated Sales or Use Taxes should be allocated as set forth
on SCHEDULE 1.2(C). The Purchase Price will be adjusted if the average per share
closing price (the "APSCP") of the Parent Common Stock on the NASDAQ National
Market for the ten (10) trading days immediately preceding the Closing is above
$22.95 pursuant to the formula set forth in Schedule 1.2(c)(i).
(d) OTHER CONTRACTUAL ARRANGEMENTS. In connection with the
consummation of the Acquisition, at the Closing the parties shall enter
intoadditional contractual arrangements as follows:
(i) PATENT LICENSE AGREEMENT. The Parties will execute a patent
license agreement in the form attached hereto as Exhibit 1.2(d)(i).
(ii) STRATEGIC COOPERATION AGREEMENT. The Parties will enter into
good faith negotiation of a strategic sales, resource cooperation, and general
services agreement, with the intention that such an agreement be executed within
30 (thirty) days of the execution of this Agreement.
(iii) REGISTRATION RIGHTS AGREEMENT. The Parties will execute a
registration rights agreement in the form attached hereto as Exhibit 1.2(d)
(iii).
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(iv) TRANSITION SERVICES AGREEMENT. The Parties will execute a
transition services agreement in the form attached hereto as Exhibit 1.2(d)(iv).
(v) SUBCONTRACT AGREEMENT. The Parties will execute the Telkom
South Africa subcontract agreement in the form attached hereto as Exhibit 1.2(d)
(v).
(vi) VALUE ADDED RESELLER AGREEMENT. The Parties will enter into
good faith negotiation of a value added reseller agreement, with the intention
that such an agreement be executed within 30 (thirty) days of the execution of
this Agreement.
(e) THE CLOSING. Subject to the satisfaction (or waiver as herein
provided) of the conditions precedent to the Acquisition set forth in Article 4,
the consummation of the transactions contemplated by this Agreement (the
"Closing") shall take place at the offices of Geoworks Corporation, at 10:00
a.m., local time, on July 24, 2000, or at such other time and place and on such
other date as Purchaser and Seller shall mutually agree (the "Closing Date"),
this Agreement to be executed by exchange of signature pages transmitted via fax
with the same force and effect as if original signatures on such pages were
exchanged.
1.3. TRANSFER OF TITLE TO THE ACQUIRED ASSETS. The sale, assignment,
conveyance, transfer, and delivery by Seller to Purchaser of the Acquired Assets
shall be made at the Closing by appropriate bills of sale, assignments,
endorsements, and such other appropriate instruments of transfer as shall be
reasonably requested by Purchaser or otherwise sufficient to vest in the
Purchaser as of the Closing Date good and marketable title to the Acquired
Assets, and valid and enforceable interests in the Assumed Contracts. Title to
the Acquired Assets and Assumed Contracts shall be transferred and conveyed to
Purchaser free and clear of all encumbrances except Permitted Encumbrances. Such
instruments of assignment, conveyance, and transfer shall include without
limitation a xxxx of sale transferring title to tangible Acquired Assets in the
form of SCHEDULE 1.3(A) hereto (the "Xxxx of Sale"), an assignment and
assumption agreement transferring title to intangible Acquired Assets
substantially in the form of SCHEDULE 1.3(B) hereto (the "Assignment") and
related or required assignments and documents transferring Seller's interest
thereto, including form documents required by governmental authorities to
perfect transfer (e.g. U.S. PTO Assignment Forms). Risk of loss of the Acquired
Assets shall pass from Seller to Purchaser at Closing. Title to all tangible
personal property included in the Acquired Assets conveyed by Seller to
Purchaser shall be deemed to be conveyed at the location where such tangible
personal property is located and delivered at Closing.
1.4 EMPLOYEES. Seller shall be solely responsible for all notices to
employees of the Business ("Employees") identified in Exhibit 1.4 hereto,
required by federal or state law, including, without limitation, any notice
required by the Consolidated Omnibus Budget Reconciliation Act of 1985, as
amended ("COBRA") or WARN. Seller shall be solely responsible for and shall pay
any severance, termination payments, COBRA benefit, accrued vacation pay,
pension, and similar accrued benefit, or Liabilities relating to any of the
Employees or to which any Employee is entitled, including claims related in any
way to the employment of an Employee by Seller
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based upon events occurring prior to the Closing Date, regardless of when any
such claim or demand therefor may be made.
1.5. FURTHER ASSURANCES. At any time and from time to time after the
Closing, at Purchaser's request and without further consideration, Seller,
promptly shall execute and deliver such instruments of sale, transfer,
conveyance, assignment, and confirmation, and take such other action, as
Purchaser may reasonably request to more effectively transfer, convey and assign
to Purchaser, and to confirm Purchaser's title to, the Acquired Assets and the
Assumed Contracts, subject to the Permitted Encumbrances to put Purchaser in
actual possession and operating control thereof, to assist Purchaser in
exercising all rights with respect thereto in order to carry out the purpose and
intent of this Agreement.
1.6. COLLECTION OF ACQUIRED ASSETS. After the Closing, Purchaser shall have
the right and authority to collect all accounts receivable included in the
Acquired Assets and to endorse with the name of Seller any checks received on
account of such accounts receivable or other items. Seller shall promptly
transfer or deliver to Purchaser from time to time, any cash or other property
that Seller may receive with respect to any claims, contracts, licenses, leases,
commitments, sales orders, purchase orders, accounts receivable or other item of
any character included in the Acquired Assets.
1.7. COOPERATION AFTER CLOSING; TRANSITION ACCOUNTING; DETERMINATION AND
LIQUIDATION OF ASSUMED LIABILITIES. Seller shall maintain the existing
accounting system of the Business to the extent and for so long as necessary to
accurately account for the transactions contemplated by this Agreement. As soon
as convenient after the Closing, but in no case later than August 18, 2000,
Seller shall deliver to Purchaser a complete set of financial statements and a
trial balance, as of the close of business on the day immediately prior to the
Closing Date. Thereafter, Seller will continue to maintain the books and records
of the Business to the extent necessary to record and determine as of the
Closing Date on a consistent basis:
(a) the Assumed Liabilities;
(b) the income, expense, and results of operations of the Business
through the Closing Date;
(c) the historical cost and depreciable basis of each of the Acquired
Assets; and
(d) any information required to prepare final employment, tax, or
regulatory reports with respect to the Transferred Employees.
All Assumed Liabilities shall be determined on the accrual basis as
of the Closing Date. Any Assumed Liability that relates to employment up to and
including the Closing Date (including, but not limited to, salary, wage,
vacation, withholding or payroll taxes, workers' compensation insurance,
retirement plan contributions, or medical plan benefits) shall be re-
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ported in the returns or reports of Seller without regard to the fact such items
may be paid or liquidated in fact by Purchaser.
Any Assumed Liability that relates to a regulatory fee or tax other
than an employment tax (including but not limited to sales or use tax, excise
tax) shall be reported in the returns or reports of Seller without regard to the
fact such items may be paid or liquidated in fact by Purchaser.
1.8. COOPERATION AFTER CLOSING; SELLER TAX MATTERS. Purchaser shall provide
all information or assistance requested by Seller in resolution of any Tax audit
or Tax matter of Seller for periods prior to the Closing Date, including, but
not limited to access to Employees at Purchaser's standard hourly rates when and
as requested by Seller.
ARTICLE 2
REPRESENTATION AND WARRANTIES
2.1 REPRESENTATIONS AND WARRANTIES OF SELLER. Except as specifically
disclosed by Seller to Purchaser in this Agreement and in the Seller Disclosure
Schedule attached hereto (the "Seller Disclosure Schedule") (the disclosures in
which shall be deemed to modify and qualify only the representations and
warranties of Seller to which any such disclosure specifically relates and
pertains), Seller represents and warrants to and for the benefit of Purchaser as
follows:
(a) DUE ORGANIZATION, GOOD STANDING, AND CORPORATE POWER. Seller is a
corporation duly organized, validly existing, and in good standing under the
laws of the State of Delaware. Seller has all requisite corporate power and
authority to own, lease, and operate its properties and to carry on its
business, including the Business, as now being conducted. Seller is duly
qualified or licensed to do business and is in good standing in each
jurisdiction in which the property owned, leased, or operated by it or the
nature of the business conducted by it makes such qualification or licensing
necessary, except in such jurisdictions where the failure to be so qualified or
licensed and in good standing would not have a Material Adverse Effect (as
defined below) on the Business.
For purposes of this Agreement, a "Material Adverse Effect" with
respect to the Business or with respect to a party means a material adverse
effect (i) on the business, properties, assets, liabilities, operations, results
of operation or condition (financial or otherwise) of Seller, on the one hand,
or Purchaser and Parent, on the other hand, as applicable, taken as a whole, or
(ii) on the ability of Seller, on the one hand, or Purchaser and Parent, on the
other hand, to perform its obligations under or to consummate the transactions
contemplated by this Agreement; provided, that none of the following shall
constitute a Material Adverse Effect: (i) with respect to the Business,
occurrences affecting the Business, and with respect to Purchaser and Parent,
occurrences affecting Purchaser or Parent, as applicable, as a result of the
announcement of the execution of this Agreement; (ii) general economic
conditions; or (iii) any changes generally affecting the industries in which the
Business, or in which such party, operates.
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The Business comprises an operating, unincorporated division of
Seller. Seller has filed fictitious business name statements in each county in
New Jersey where the Business is conducted and where the enforcement of rights
of the Business in any New Jersey state court would require such filing(s),
except where such filing(s), if not made, would not have a Material Adverse
Effect on the Business.
(b) AUTHORIZATION AND VALIDITY OF AGREEMENT. Seller has full
corporate power and authority to execute and deliver this Agreement, to perform
its obligations hereunder and to consummate the transactions contemplated
hereby. The execution, delivery, and performance by Seller of this Agreement,
and the consummation by Seller of the transactions contemplated hereby, have
been duly authorized and approved by the Board of Directors of Seller. No other
corporate action on the part of Seller is necessary to authorize the execution,
delivery, and performance of this Agreement and the consummation of the
transactions contemplated hereby. This Agreement has been duly executed and
delivered by Seller and constitutes the valid and binding obligation of Seller,
enforceable against Seller in accordance with its terms (subject to applicable
bankruptcy, insolvency, reorganization, moratorium, fraudulent transfer and
other similar laws affecting creditors' rights generally from time to time in
effect and to general principles of equity, including concepts of materiality,
reasonableness, good faith and fair dealing, regardless of whether in a
proceeding at equity or at law).
(c) CONSENTS AND APPROVALS; NO VIOLATIONS. The execution and delivery
of this Agreement by Seller and the consummation by Seller of the transactions
contemplated hereby will not: (i) violate any provision of the charter documents
or the by-laws of Seller; (ii) violate any statute, ordinance, rule, regulation,
order or decree of any court or of any governmental or regulatory body, agency
or authority applicable to Seller or any of its Subsidiaries or by which any of
its properties or assets may be bound, except such violations which would not
have a Material Adverse Effect on the Business; (iii) require any filing with,
or permit, consent or approval of, or the giving of any notice to, any
governmental or regulatory body, agency or authority other than the filing of a
pre-merger notification with the Federal Trade Commission and the Department of
Justice under the Xxxx-Xxxxx-Xxxxxx Antitrust Improvements Act of 1976, (as
amended (the "HSR Act"), except where the failure to make such filing, or obtain
such permit, consent or approval, or give such notice would not have a Material
Adverse Effect on the Business, or (iv) result in a violation, termination or
breach of, conflict with, constitute (with or without the giving of notice or
lapse of time or both) a default (or give rise to any right of termination,
cancellation, payment, or acceleration) under, result in the creation of any
lien, security interest, charge or encumbrance upon any of the Acquired Assets
or under any of the Assumed Contracts, result in the forfeiture of any rights,
entitlements or privileges of the Business or under any of the Assumed
Contracts, create any right or entitlement (including, without limitation, to
employment or compensation) not expressly provided for herein, or require the
consent or approval of any party under any of the terms, conditions or
provisions of any note, contract, bond, mortgage, indenture, license, franchise,
permit, agreement, lease, franchise or other instrument or obligation to which
Seller is a party, or by which it or any of the Acquired Assets are or may be
bound, except such violations, terminations, breaches, conflicts or defaults
which would not have a Material Adverse Effect on the Business.
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(d) FINANCIAL STATEMENTS OF THE BUSINESS. Seller has delivered to
Purchaser the audited financial statements of the Business for fiscal years 1999
and 2000 (the "Financial Statements"). The balance sheet of the for fiscal year
2000 included in the Financial Statements is hereafter referred to as the
"Balance Sheet." The Financial Statements were prepared in accordance with
generally accepted accounting principles applied on a consistent basis and in
accordance with past practice and fairly present in all material respect the
financial position of the Business as of the dates thereof and the results of
its operations and cash flows for the periods then ended. Seller has also
delivered to Purchaser the unaudited interim financial statements of the
Business, consisting of a balance sheet as of April 30, 2000, and an income
statement and statement of cash flows for the three - month period then ended
(the "Interim Financial Statements"). The balance sheet of the Business as of
April 30, 2000 included in the Interim Financial Statements is hereafter
referred to as the "Interim Balance Sheet." The Interim Financial Statements
were prepared in accordance with generally accepted accounting principles
applied on a consistent basis and in accordance with past practice (except as
may be indicated in the notes thereto) and fairly present in all material
respects the financial position of the Business as of the date thereof and the
results of its operations and cash flows for the period then ended subject to
normal year-end adjustments.
(e) ABSENCE OF UNDISCLOSED LIABILITIES. Except as set forth in the
Balance Sheet or the Interim Balance Sheet, the Business has no outstanding
Liabilities or indebtedness, contingent or otherwise, other than (i) Liabilities
incurred subsequent to the date of the Interim Balance Sheet in the Ordinary
Course of Business, (ii) Liabilities which, individually or in the aggregate,
have not had and would not have a Material Adverse Effect on the Business and
(iii) Liabilities under this Agreement or incurred in connection with the
transactions contemplated hereby.
(f) ACCOUNTS RECEIVABLE. The accounts receivable of the Business as
reflected in the Balance Sheet and the Interim Balance Sheet are, to the extent
uncollected on the date of this Agreement, valid and existing and represent
monies due for services rendered. To the knowledge of Seller, the accounts
receivable of the Business as reflected in the Balance Sheet and the Interim
Balance Sheet are not uncollectible.
(g) ALL ASSETS OF BUSINESS; CONDITION OF ACQUIRED ASSETS. The
Acquired Assets constitute all of the material assets used and necessary to
conduct the Business as presently conducted by Seller. All of the tangible
assets included in the Acquired Assets are free from material defects (patent
and latent), are in good repair (except for normal wear and tear), have been
well maintained, and conform with all applicable ordinances, regulations and
zoning, environmental and other laws, regulations and ordinances (except to the
extent that any non-conformance would, not have a Material Adverse Effect on the
Business. All products, servers, computers, machinery, and equipment included in
the Acquired Assets are in good working order (except for normal wear and tear)
and are suitable for the purposes for which they are presently used.
(h) TITLE TO PROPERTIES; ENCUMBRANCES. Seller has good, valid, and
marketable title to (A) all of the tangible properties and assets (real and
personal) which it owns
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and which are used in the Business, including, without limitation, all the
tangible properties and assets reflected in the Balance Sheet and the Interim
Balance Sheet and (B) all of the tangible properties and assets purchased by
Seller for or on behalf of the Business or used in the Business since the date
of the Interim Financial Statements, except for such properties and assets which
have been sold, consumed or otherwise disposed of in the Ordinary Course of
Business. All of the tangible properties and assets used in the Business are, or
by the Closing will be, in each case subject to no security interest,
encumbrance, lien, charge, or other restriction of any kind or character (each
an "Encumbrance"), except for (W) liens reflected in the Balance Sheet and the
Interim Balance Sheet, or disclosed in the Seller Disclosure Schedule, (X) liens
consisting of zoning or planning restrictions, easements, permits and other
restrictions or limitations on the use of real property or irregularities in
title thereto which do not materially detract from the value of, or impair the
use of, such property in the operation of the Business, (Y) liens for current
taxes, assessments, or governmental charges or levies on property not yet due
and delinquent, and (Z) any Encumbrance which would not have a Material Adverse
Effect on the Business or materially interfere with the use of such properties
and assets as they are presently being used.
(i) ABSENCE OF CERTAIN CHANGES AND EVENTS. Since the date of the
Interim Balance Sheet (i) there has not been through the Closing Date hereof any
change in the business, operation or financial position of the Business, except
for any adverse change which would not have a Material Adverse Effect on the
Business; (ii) the Business has been conducted in the ordinary course consistent
with past practices; (iii) Seller has not incurred any material liabilities
(direct, contingent, or otherwise) or engaged in any material transaction or
entered into any material agreement which has or would be reasonably expected to
have a Material Adverse Effect on the Business; (iv) Seller has not increased
the compensation of any Employee (as defined herein) or granted any salary or
benefits increase to any Employee except for increases in compensation, salary
or benefits to Employees in the ordinary course consistent with past practice or
merit increases in salaries of Employees at regularly scheduled times in
customary amounts in the ordinary course consistent with past practice; (v)
Seller has not taken any action referred to in Section 3.3 hereof in respect of
or in connection with the Business except for any action which would not have a
Material Adverse Effect on the Business; (vi) Seller has not made any material
change in any method of accounting or accounting principles or practice, except
for any such change required by reason of a change in GAAP and (vii) Seller has
not permitted or suffered any Encumbrance on any assets (tangible or intangible)
or properties of the Business other than Permitted Encumbrances and except those
Encumbrances which are not likely to have a Material Adverse Effect.
(j) COMPLIANCE WITH LAWS. The Business has been and is operated and
conducted in substantial compliance with all applicable laws, regulations,
orders, and judgments. and decrees, except for violations and failures to comply
that have not had and would not result in a Material Adverse Effect on the
Business.
(k) ASSUMED CONTRACTS. Seller has delivered to Purchaser true and
correct copies of each written document listed in SCHEDULE 1.1(B). As of the
date hereof, the Assumed Contracts are, and as of the Closing Date will be,
valid, and enforceable in accordance with their terms and in full force and
effect. To the knowledge of Seller, Seller is not, and as of the Closing Date
Seller will not be, in default under any of the Assumed Contracts. To the
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knowledge of Seller, Seller has not, as of the date of this Agreement, received
notice that any party to any such Assumed Contract intends to cancel or
terminate such Assumed Contract.
(l) LITIGATION. Except as disclosed in the Seller Disclosure
Schedule, there is no action, suit, proceeding at law or in equity, or any
arbitration or any administrative or other proceeding by or before (or, to the
knowledge of Seller, any investigation by) any governmental or other
instrumentality or agency, pending, or, to the knowledge of Seller, threatened,
against or affecting Seller in respect to the Business or any of the Acquired
Assets. There are no suits, actions, claims, proceedings, or investigations
pending or, to the knowledge of Seller, threatened, seeking to prevent or
challenging the transactions contemplated by this Agreement. Seller is not
subject to any judgment, order, or decree entered in any lawsuit or proceeding
in respect of the Business or by the terms of which Seller is restricted or
limited in the conduct of the Business which, individually or in the aggregate,
would have a Material Adverse Effect on the Business.
(m) EMPLOYEE BENEFIT PLANS All employee benefit plans, as that term
is defined in Section 3(3) of the Employee Retirement Income Security Act of
1974, as amended ("ERISA"), that are maintained by Seller relating to the
Business or the Employees or to which Seller (or any subsidiary of Seller) has
an obligation to contribute relating to the Business or the Employees (the
"Employee Benefit Plans") are described in the Seller Disclosure Schedule. No
event has occurred nor has there been any omission that would result in
violation of any laws, rulings, or regulations applicable to any Employee
Benefit Plan. There are no claims pending or, to the knowledge of Seller,
threatened with respect to any Employee Benefit Plan, other than claims for the
benefits by employees, beneficiaries, or dependents arising in the normal course
of the operation of any such plan. Each such Benefit Plan (and each related
trust, insurance contract, or fund) complies in form and in operation in all
materials respects with the applicable requirements of ERISA, the Code, and
other applicable laws. All required reports and descriptions have been filed or
distributed appropriately with respect to each Benefit Plan. All contributions
(including all employer contributions and employee salary reduction
contributions) that are due have been paid to each such Benefit Plan and all
contributions for any period ending on or before the Closing Date that are not
yet due have been paid to each such Benefit Plan or accrued in accordance with
the past custom and practice of the Company. All premiums or other payments for
all periods ending on or before the Closing Date have been paid with respect to
each such Benefit Plan. On or before the Closing Date, Seller shall resolve,
fully liquidate, and pay off in full all obligations or contributions of every
kind and nature related to every Employee of the Business and all contract
employees of the Business.
(n) TAXES.
(i) Purchaser shall have no liability for any Taxes arising in
respect of the operation and conduct of the Business by Seller prior to the
Closing Date.
(ii) Seller has properly withheld all material amounts required by
law to be withheld for income taxes and unemployment taxes including without
limitation, with respect to social security and unemployment compensation,
relating to the Employees, and has
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properly remitted all material withheld amounts required to be remitted to the
appropriate taxing authority, agency or body.
(iii) To the knowledge of Seller, Seller has filed all tax returns
required to be filed and has paid all Taxes required to be paid in connection
with the operation and conduct of the Business.
(o) EMPLOYMENT RELATIONS AND AGREEMENTS. In the operation and conduct
of the Business: (i) Seller is in compliance with all federal, state or other
applicable laws with respect to employment and employment practices, terms and
conditions of employment, wages and hours and occupational health and safety,
except for any noncompliance which would not have a Material Adverse Effect on
the Business; (ii) Seller has not experienced any labor difficulty which would
have a Material Adverse Effect on the Business and is not a party to or bound by
any collective bargaining agreement; and (iii) Seller has not experienced any
strikes, grievances, claims of unfair labor practices, or other collective
bargaining disputes which would have a Material Adverse Effect on the Business.
The current employee handbook of Seller is included in the Seller Disclosure
Schedule.
(p) RELATIONS WITH CERTAIN VENDORS. To the knowledge of Seller,
Seller has good working relationships with each of its material vendors and
suppliers. The relationships with such vendors and suppliers will not be
adversely affected by the consummation of the Acquisition.
(q) INTELLECTUAL PROPERTY. The Seller Disclosure Schedule contains an
accurate and complete list of all Intellectual Property that is being conveyed
to Purchaser. Seller owns the entire right, title, and interest in and to the
Intellectual Property conveyed to Purchaser and each item constituting part of
the Intellectual Property which is owned by Seller and listed in the Seller
Disclosure Schedule has been, to the extent indicated in the Seller Disclosure
Schedule, duly registered with, filed in or issued by, as the case may be, the
United States Patent and Trademark Office or such other government entities,
domestic or foreign as are indicated in the Seller Disclosure Schedule, and all
such registrations, filings, and issuances are current and remain in full force
and effect. There are no pending or, to the knowledge of Seller, threatened
proceedings or litigation affecting or with respect to the Intellectual
Property, which individually or in the aggregate, would have a Material Adverse
Effect on the Business. The Seller Disclosure Schedule lists all notices or
claims currently pending or received by Seller during the past two years which
claim infringement, contributory infringement, inducement to infringe,
misappropriation or breach by Seller of any domestic or foreign patents, patent
applications, patent licenses and know-how licenses, trade names, trademark
registrations and applications, service marks, copyrights, copyright
registrations or applications, trade secrets or other confidential proprietary
information insofar as the same relates directly or indirectly to the Business.
Except as set forth in the Seller Disclosure Schedule, to the knowledge of
Seller, no person or entity is infringing, or believed to be infringing, the
Intellectual Property.
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(r) INSURANCE. Seller has at all times during the operation and
conduct of the Business maintained policies or binders of fire, liability,
product liability, worker's compensation, vehicular or other insurance adequate
for the operation and conduct of the Business.
(s) PRODUCT WARRANTY. Each product material to the Business that was
developed, manufactured, sold, leased, or delivered by Seller has been in
conformity with all applicable contractual commitments and all express and
implied warranties, except where such non-conformity would not have a Material
Adverse Effect on the Business. Seller has no Liability for replacement or
repair thereof or other damages in connection therewith, except where such
non-conformity would not have a Material Adverse Effect on the Business. No
product material to the Business that was developed, manufactured, sold, leased,
or delivered by Seller is subject to any guaranty, warranty, or other indemnity
beyond the applicable standard terms and conditions of sale or lease as set
forth in Seller's sales and services agreements. The Seller Disclosure Schedule
includes copies of the standard forms of such agreements and standard terms and
conditions of sale for all products material to the Business that was developed,
manufactured, sold, and leased by Seller. None of such agreements, which are
included in the Assumed Contracts, deviate from the standard terms and
conditions of such agreements or contain modifications other than modifications
representing or consisting of changes in such agreements, which have been
negotiated by Seller with its customers in the ordinary course of business and
which would not have a Material Adverse Effect on the Business.
(t) TRANSACTIONS WITH MANAGEMENT. No director or executive officer of
Seller: (i) has any contractual relationship with the Business, the liabilities
under which are not reflected in the Financial Statements, or the Interim
Financial Statements; (ii) has any direct or indirect interest in any right,
property or asset which is used in the Business; or (iii) owns a material amount
of securities of, or has any material direct or indirect interest in, any entity
which does business with the Business.
(u) BROKER'S OR FINDER'S FEE. Other than Broadview Int'l, no agent,
broker, person, or firm acting on behalf of Seller is, or will be, entitled to
any commission or broker's or finder's fees in connection with this Agreement or
any of the transactions contemplated herein. Any such fees shall be paid by
Seller and Purchaser shall have no liability for the payment of all or any part
of any such fee.
(v) BULK TRANSFER. Seller will obtain bulk transfer and related
approvals prior to Closing, where Seller is required to do so, except where (i)
Parent or Purchaser have the obligation to obtain such approvals under
applicable state law, or (ii) where failure to obtain such approvals would not
have a Material Adverse Effect on the Business.
(w) STATEMENTS AND OTHER DOCUMENTS NOT MISLEADING. This Agreement,
including all, Schedules, the Seller Disclosure Schedule, and any other document
or instrument heretofore or hereafter furnished by Seller in connection with the
transactions contemplated hereby, does not and shall not contain any untrue
statement of any material fact or omits or will omit to state any material fact
required to be stated in order to make such statement,
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document or other instrument not misleading. There is no fact known to Seller
that may materially adversely affect the Condition of the Business that has not
been set forth in this Agreement, the Seller Disclosure Schedule or the
Schedules.
(x) INVESTMENT PURPOSE. Seller is acquiring the Parent Shares for its
own account for investment only and not with a view towards, or for resale in
connection with, the public sale or distribution thereof, except pursuant to
sales registered or exempted under the Securities Act of 1933, as amended (the
"1933 Act"); PROVIDED, HOWEVER, that by making the representations herein,
Seller does not agree to hold any of the Parent Shares for any minimum or other
specific term and reserves the right to dispose of any or all of them at any
time in accordance with or pursuant to a registration statement or an exemption
under the 1933 Act.
(y) ACCREDITED INVESTOR STATUS. Seller is an "accredited investor" as
that term is defined in Rule 501(a)(3)of Regulation D.
(z) RELIANCE ON EXEMPTIONS. Seller understands that the Parent Shares
are being offered and sold to it in reliance on specific exemptions from the
registration requirements of United States federal and state securities laws and
that Parent is relying in part upon the truth and accuracy of, and Seller's
compliance with, the representations, warranties, agreements, acknowledgments
and understandings of Seller set forth herein in subsections (x) to (ad) of this
Section 2.1 in order to determine the availability of such exemptions and the
eligibility of Seller to acquire the Parent Shares.
(aa) INFORMATION. Seller and its advisors have been furnished with
all materials relating to the business, finances, and operations of the Parent
and materials relating to the offer and sale of the Parent Shares that have been
requested by Seller. Seller and its advisors, if any, have been afforded the
opportunity to ask questions of the Purchaser. Seller understands that its
investment in the Parent Shares involves a high degree of risk. Seller has
sought such accounting, legal and tax advice, as it has considered necessary to
make an informed investment decision with respect to its acquisition of the
Parent Shares.
(ab) NO GOVERNMENTAL REVIEW. Seller understands that no United States
federal or state agency or any other government or governmental agency has
passed on or made any recommendation or endorsement of the Parent Shares or the
fairness or suitability of the investment in the Parent Shares nor have such
authorities passed upon or endorsed the merits of the offering of the Parent
Shares.
(ac) TRANSFER OR RESALE. Seller understands that except as provided
in the Registration Rights Agreement: (i) the Parent Shares have not been and
are not being registered under the 1933 Act or any state securities laws, and
may not be offered for sale, sold, assigned, or transferred unless (A)
subsequently registered thereunder, (B) Seller shall have delivered to Parent an
opinion of counsel, in a reasonably acceptable form, to the effect that such
Parent Shares to be sold, assigned, or transferred may be sold, assigned, or
transferred pursuant to an exemption from such registration, or (C) Seller
provides the Purchaser
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with reasonable assurance that such Parent Shares can be sold, assigned, or
transferred pursuant to Rule 144 promulgated under the 1933 Act (or a successor
rule thereto) ("Rule 144"); and (ii) any sale of the Purchase Price shares made
in reliance on Rule 144 may be made only in accordance with the terms of Rule
144 and, further, if Seller intends to utilize Rule 144 but Rule 144 is not
applicable to such resale, any resale of the Parent Shares under circumstances
in which Seller (or the person through whom the sale is made) may be deemed to
be an underwriter (as that term is defined in the 0000 Xxx) may require
compliance with some other exemption under the 1933 Act or the rules and
regulations of the SEC thereunder.
(ad) LEGENDS. Seller understands that the certificates or other
instruments representing the Parent Shares shall bear a restrictive legend in
substantially the following form (and a stop-transfer order may be placed
against transfer of such stock certificates):
THE SECURITIES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN
REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE
"1933 ACT"), OR APPLICABLE STATE SECURITIES LAWS. THE
SECURITIES HAVE BEEN ACQUIRED FOR INVESTMENT AND MAY NOT BE
OFFERED FOR SALE, SOLD, TRANSFERRED OR ASSIGNED (1) IN THE
ABSENCE OF AN EFFECTIVE REGISTRATION STATEMENT FOR THE
SECURITIES UNDER THE 1933 ACT OR APPLICABLE STATE SECURITIES
LAWS, OR (2) IN THE ABSENCE OF AN OPINION OF COUNSEL, IN A
REASONABLY ACCEPTABLE FORM, THAT REGISTRATION IS NOT
REQUIRED UNDER THE 1933 ACT OR (3) UNLESS SOLD, TRANSFERRED
OR ASSIGNED PURSUANT TO RULE 144 UNDER SAID ACT.
The legend set forth above shall be removed and Parent shall issue a
certificate without such legend to the holder of the Parent Shares upon which it
is stamped, if, unless otherwise required by state securities laws, (i) the
Parent Shares are registered for sale under the 1933 Act, (ii) in connection
with a sale transaction, such holder provides Parent with an opinion of counsel,
in a reasonably acceptable form, to the effect that a public sale, assignment or
transfer of the Parent Shares may be made without registration under the 1933
Act, or (iii) such holder provides the Parent with reasonable assurances that
the Parent Shares can be sold pursuant to Rule 144 without any restriction as to
the number of securities acquired as of a particular date that can then be
immediately sold.
2.2. REPRESENTATIONS AND WARRANTIES OF PARENT AND PURCHASER. Except as
specifically disclosed by Parent and Purchaser to Seller in this Agreement and
in the Parent and Purchaser Disclosure Schedule attached hereto (the "Parent and
Purchaser Disclosure Schedule") (the disclosures in which shall be deemed to
modify and qualify only the representations and warranties of Parent and
Purchaser to which any such disclosure specifically relates and pertains),
Parent and Purchaser represent and warrant, jointly and severally, to and for
the benefit of Seller as follows:
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(a) DUE ORGANIZATION; GOOD STANDING AND CORPORATE POWER. Parent is a
corporation duly organized, validly existing and in good standing under the laws
of the State of Delaware. Parent has all requisite corporate power and authority
to own, lease and operate its properties and to carry on its business as now
being conducted. Parent is duly qualified or licensed to do business and is in
good standing in each jurisdiction in which the property owned, leased, or
operated by it or the nature of the business conducted by it makes such
qualification or licensing necessary, except in such jurisdictions where the
failure to be so qualified or licensed and in good standing would not have a
Material Adverse Effect on Parent. Purchaser is a corporation duly organized,
validly existing and in good standing under the laws of the State of New Jersey.
Purchaser has all requisite corporate power and authority to own, lease and
operate its properties and to carry on its business as now being conducted.
Purchaser is duly qualified or licensed to do business and is in good standing
in each jurisdiction in which the property owned, leased, or operated by it or
the nature of the business conducted by it makes such qualification or licensing
necessary, except in such jurisdictions where the failure to be so qualified or
licensed and in good standing would not have a Material Adverse Effect on
Purchaser.
(b) CAPITALIZATION.
(i) The authorized capital stock of Parent consists of 40,000,000
shares of Common Stock and 2,000,000 shares of preferred stock. As of the close
of business on July 24, 2000, 3,519,838 shares of Parent Common Stock are
underlying grants under option and other stock plans of Parent. All the
outstanding shares of Parent's capital stock are, and all shares which may be
issued pursuant to Parent option plans will be, when issued in accordance with
the terms thereof, duly authorized, validly issued, fully paid and
non-assessable. Except as set forth in the Parent Disclosure Schedule, as of the
date hereof, there are no outstanding (x) shares of capital stock or other
voting securities of Parent, (y) securities of Parent convertible into or
exchangeable for shares of capital stock or voting securities of Parent and (z)
options, warrants or other rights to acquire from Parent, and no preemptive or
similar rights, subscriptions or other rights, convertible securities,
agreements, arrangements or commitments of any character, relating to the
capital stock of Parent, obligating Parent to issue, transfer or sell, any
capital stock, voting securities or securities convertible into or exchangeable
for capital stock or voting securities of Parent or obligating Parent to grant,
extend or enter into any such option, warrant, subscription or other right,
convertible security, agreement, arrangement or commitment. There are no voting
trusts or other agreements or understandings to which Parent is a party with
respect to the voting of the capital stock of Parent.
(ii) The Parent Shares, upon delivery to Seller of share
certificates therefor against payment in accordance with the terms of this
Agreement, (A) will be validly issued, fully paid and nonassessable, (B) will be
free and clear of all Encumbrances and (C) will be issued in compliance with all
U.S. federal and state securities laws.
(c) AUTHORIZATION AND VALIDITY OF AGREEMENT. Purchaser has full
corporate power and authority to execute and deliver this Agreement, and to
perform its obligations hereunder and to consummate the transactions
contemplated hereby. Parent has full corporate power and authority to execute
and deliver this Agreement, to perform its obligations hereunder and to
consummate the transactions contemplated hereby. The execution, delivery, and
performance of
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this Agreement by Purchaser and Parent and the consummation by it Purchaser and
Parent of the transactions contemplated hereby, have been duly authorized and
approved by the Board of Directors of Purchaser and Parent. No other corporate
action on the part of Purchaser and Parent is necessary to authorize the
execution, delivery, and performance by Purchaser and Parent of this Agreement
and the consummation by it Purchaser and Parent of the transactions contemplated
hereby. This Agreement has been duly executed and delivered by Purchaser and
Parent and constitutes the valid and binding obligation of Purchaser and Parent,
enforceable against Purchaser and Parent in accordance with its terms (subject
to applicable bankruptcy, insolvency, reorganization, moratorium, fraudulent
transfer and other similar laws affecting creditors' rights generally from time
to time in effect and to general principles of equity, including concepts of
materiality, reasonableness, good faith and fair dealing, regardless of whether
in a proceeding at equity or at law).
(d) CONSENTS AND APPROVALS. The execution and delivery of this
Agreement by Purchaser and Parent and the consummation by them of the
transactions contemplated hereby will not: (i) violate any provision of the
charter documents or by-laws of Purchaser or Parent; (ii) violate any statute,
ordinance, rule, regulation, order or decree of any court or of any governmental
or regulatory body, agency or authority applicable to Purchaser or Parent or by
which any of their properties or assets may be bound, except such violations
which would not have a Material Adverse Effect on Parent; (iii) require any
filing with, or permit, consent or approval of, or the giving of any notice to,
any governmental or regulatory body, agency or authority other than the filing
of a pre-acquisition notification with the Federal Trade Commission and the
Department of Justice under the HSR Act except where the failure to make such
filing, or obtain such permit, consent or approval, or give such notice will not
have a Material Adverse Effect on Parent; or (iv) result in a violation,
termination or breach of, conflict with, constitute (with or without the giving
of notice or lapse of time or both) a default (or give rise to any right of
termination, cancellation, payment or acceleration) under, result in the
forfeiture of any rights, entitlements or privileges under, create any right or
entitlement (including, without limitation, to employment or compensation) not
expressly provided for herein, or require the consent or approval of any party
under, any of the terms, conditions or provisions of any note, bond, mortgage,
indenture, license, franchise, permit, agreement, lease, franchise agreement or
other instrument or obligation to which Purchaser, Parent or any of their
Subsidiaries is a party, or by which they or any of their respective properties
or assets may be bound, except such violations, terminations, breaches,
conflicts or defaults which would not have a Material Adverse Effect on Parent.
(e) FINANCIAL STATEMENTS. Parent has delivered to Seller audited
financial statements for fiscal years 1999 and 2000 (the "Parent Financial
Statements"). The balance sheet of Parent for fiscal 2000 included in the Parent
Financial Statements is hereafter referred to as the "Parent Balance Sheet". The
Parent Financial Statements are in accordance with the books and records of
Parent (which books and records are true and correct) and were prepared in
accordance with generally accepted accounting principles applied on a consistent
basis and in accordance with past practice and fairly present in all material
respects the consolidated financial position of Parent as of the dates thereof
and the results of its operations, Stockholders' equity and cash flows for the
periods then ended. Parent has also delivered to Seller interim financial
statements,
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consisting of a balance sheet as of May 30, 2000, and an income statement,
statement of stockholders' equity and statement of cash flows for the two-month
period then ended (the "Purchaser Interim Financial Statements"). The balance
sheet of Parent included in the Parent Interim Financial Statements is hereafter
referred to as the "Parent Interim Balance Sheet." The Purchaser Interim
Financial Statements were prepared in accordance with generally accepted
accounting principles applied on a consistent basis and in accordance with past
practice (except as may be indicated in the notes thereto) and fairly present in
all material respects the consolidated financial position of Purchaser as of the
date thereof and the results of its operations and cash flows for the period
then ended, subject to normal year-end adjustments.
(f) ABSENCE OF UNDISCLOSED LIABILITIES. Except as set forth in the
Parent Balance Sheet or the Parent Interim Balance Sheet, Parent has no
outstanding Liabilities or indebtedness, contingent or otherwise, other than (i)
Liabilities incurred subsequent to the date of the Parent Interim Balance Sheet
in the Ordinary Course of Business, (ii) Liabilities which, individually or in
the aggregate, have not had and would not have a Material Adverse Effect on
Parent and (iii) Liabilities under this Agreement or incurred in connection with
the transactions contemplated hereby.
(g) ABSENCE OF CERTAIN CHANGES AND EVENTS. Since the date of the
Parent Interim Balance Sheet, (i) there has not been through the date hereof any
adverse change in the business, operations or financial position of Purchaser,
except for any adverse change which would not have a Material Adverse Effect on
Parent; (ii) Parent has conducted its business in the ordinary course consistent
with past practices; (iii) Parent has not incurred any material liabilities
(direct, contingent, or otherwise) or engaged in any material transaction or
entered into any material agreement which has or would be reasonably expected to
have a Material Adverse Effect on Parent; (iv) Parent has not increased the
compensation of any employee or granted any salary or benefits increase to any
of its employees except for increases in compensation, salary or benefits to
employees in the ordinary course consistent with past practice or merit
increases in salaries of employees at regularly scheduled times in customary
amounts in the ordinary course consistent with past practice; (v) Parent has not
taken any action referred to in Section 3.4 hereof, except for any action which
would not have a Material Adverse Effect; (vi) Parent or Purchaser has not
declared, paid or set aside for payment any dividend or other distribution
(payable in cash, or other property) to any person or repurchased, redeemed or
otherwise acquired any amount of outstanding shares of capital stock or other
equity securities of, or other ownership interests in, Parent or Purchaser;
(vii) Parent has not made any amendment of any term of any outstanding security
of Parent or any of its Subsidiaries that would materially increase the
obligations of Parent or such Subsidiary under such security; (viii) Parent has
not made any material change in any method of accounting or accounting
principles or practice, except for any such change required by reason of a
change in GAAP and (ix) Parent has not permitted or suffered any Encumbrance on
any assets (tangible or intangible) or properties of Parent or any of its
Subsidiaries other than Permitted Encumbrances and except those Encumbrances
which are not likely to have a Material Adverse Effect.
(h) COMPLIANCE WITH LAWS. Parent's business has been and is operated
and conducted in substantial compliance with all applicable laws, regulations,
orders, judgments, and
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decrees, except for violations and failures to comply that have not had and
would not result in a Material Adverse Effect on Parent.
(i) LITIGATION. Except as set forth in the Parent Disclosure
Schedule, there is no action, suit, proceeding at law or in equity, or any
arbitration or any administrative or other proceeding by or before (or, to the
knowledge of Seller, any investigation by) any governmental or other
instrumentality or agency, pending, or, to the knowledge of Parent, threatened,
against or affecting Parent which would have a Material Adverse Effect on
Parent. As of the date hereof, there are no suits, actions, claims, proceedings,
or investigations pending or, to the knowledge of Parent, threatened, seeking to
prevent or challenging the transactions contemplated by this Agreement.
(j) EMPLOYEE BENEFIT PLANS.
(i) The Parent Disclosure Schedule sets forth all "employee benefit
plans", as defined in Section 3(3) of ERISA, and all other employee benefit
arrangements or payroll practices, including, without limitation, bonus plans,
consulting or other compensation agreements, incentive, equity or equity-based
compensation, or deferred compensation arrangements, stock purchase, severance
pay, sick leave, vacation pay, salary continuation for disability,
hospitalization, medical insurance, life insurance, scholarship programs
maintained by Parent or Purchaser or to which Parent or Purchaser contributed or
is obligated to contribute thereunder for current or former employees of Parent
or Purchaser (the "Parent or Purchaser Employees") (the "Parent or Purchaser
Plans"). There are no "employee pension plans", as defined in Section 3(2) of
ERISA, subject to Title IV of ERISA or Section 412 of the Code, maintained by
Parent, Purchaser or any of their affiliates under any trade or business
(whether or not incorporated) which is or has ever been under common control, or
which is or has ever been treated as a single employer, with any of them under
Section 414(b), (c), (m), or (o) of the Code ("ERISA Affiliate") or to which
Parent or Purchaser and any ERISA Affiliate contributed or has ever been
obligated to contribute thereunder.
(ii) True, correct and complete copies of the following documents,
with respect to each of the Parent or Purchaser Plans, have been made available
or delivered to Seller by Parent or Purchaser, to the extent applicable: (A) any
plans, all amendments thereto and related trust documents, and amendments
thereto; (B) the most recent Forms 5500 and all schedules thereto and the most
recent actuarial report, if any; (C) the most recent IRS determination letter;
(D) summary plan descriptions; (E) written communications to employees relating
to the Parent or Purchaser Plans and (F) written descriptions of all non-written
agreements relating to the Parent or Purchaser Plans.
(iii) The Parent or Purchaser Plans have been maintained, in all
respects, in accordance with their terms and with all provisions of ERISA, the
Code (including rules and regulations thereunder) and other applicable federal
and state laws and regulations except as which would not have a Material Adverse
Effect on Parent.
(iv) The Parent or Purchaser Plans intended to qualify under Section
401 of the Code are so qualified and the trusts maintained pursuant thereto are
exempt
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from federal income taxation under Section 501 of the Code, and nothing has
occurred with respect to the operation of the Parent or Purchaser Plans which
would cause the loss of such qualification or exemption or the imposition of any
liability, penalty or tax under ERISA or the Code.
(v) There are no pending actions, claims or lawsuits which have been
asserted or instituted against the Parent or Purchaser Plans, the assets of any
of the trusts under such plans or the plan sponsor or the plan administrator, or
against any fiduciary of the Parent or Purchaser Plans with respect to the
operation of such plans (other than routine benefit claims), nor does Parent or
Purchaser have knowledge of any facts which could form the basis for any such
claim or lawsuit except as which would not have a Material Adverse Effect on
Parent.
(vi) None of the Parent or Purchaser Plans provide for post-
employment life or health insurance, benefits or coverage for any participant or
any beneficiary of a participant, except as may be required under COBRA, and at
the expense of the participant or the participant's beneficiary.
(k) TAXES.
(i) Parent has duly and timely filed or will file with any
federal, state, local, or foreign governmental taxing authority, body, or
agency, all federal, state, local, and foreign tax returns, declarations,
reports, estimates, information returns, and statements (collectively, the
"Returns") required to be filed or sent by or on behalf of Parent and its
Subsidiaries and all such Returns are or will be true, correct and complete.
Purchaser has paid in full all Taxes and any penalties, interest, fines or other
charges entered with respect thereto that are due and payable.
(ii) Parent and its Subsidiaries have properly withheld all
material amounts required by law to be withheld for income taxes and
unemployment taxes, including without limitation, with respect to social
security and unemployment compensation, relating to their employees, and have
properly remitted all material withheld amounts required to be remitted to the
appropriate taxing authority, agency or body.
(iii) The Parent Financial Statements reflect an adequate reserve
for all Taxes payable by Parent and its Subsidiaries for all taxable periods
through the date of such financial statements. No deficiency with respect to
Taxes has been proposed, asserted or assessed against Parent or its
Subsidiaries. There are no audits, investigations or other proceeding with
respect to Taxes of Parent or its Subsidiaries pending or, to the knowledge of
Parent, threatened.
(l) INTELLECTUAL PROPERTY. Except as set forth in the Parent
Disclosure Schedule, there are no pending or, to the knowledge of Parent,
threatened proceedings or litigation affecting or with respect to the
Intellectual Property which, individually or in the aggregate, would have a
Material Adverse Effect on Parent. The Parent Disclosure Schedule lists all
material notices or claims currently pending or received by Parent during the
past two years which claim infringement, contributory infringement, inducement
to infringe, misappropriation or breach by Parent of any domestic or foreign
patents, patent applications, patent licenses and know-how
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licenses, trade names, trademark registrations and applications, service marks,
copyrights, copyright registrations or applications, trade secrets or other
confidential proprietary information insofar as the same relates directly or
indirectly to its business. Except as set forth in the Parent Disclosure
Schedule, to the knowledge of Parent, no person or entity is infringing the
material Intellectual Property.
(m) TRANSACTIONS WITH MANAGEMENT. No director or executive officer of
Parent: (i) has any contractual relationship with Parent, the liabilities under
which are not reflected in the Parent Financial Statements, the Parent Interim
Financial Statements, or the SEC Documents; (ii) has any direct or indirect
interest in any right, property or asset which is used by Parent; or (iii) owns
a material amount of securities of, or has any material direct or indirect
interest in, any entity which does business with Parent.
(n) BROKER'S OR FINDER'S FEE. No agent, broker, person or firm acting
on behalf of Purchaser or Parent is, or will be, entitled to any commission or
broker's or finder's fees from any of the parties hereto, or from any person
controlling, controlled by, or under common control with any of the parties
hereto, in connection with this Agreement or any of the transactions
contemplated herein.
(o) SEC FILINGS. Parent has filed all required reports, schedules,
forms, statements and other documents with the Securities and Exchange
Commission (the "SEC") since December 31, 1997 (the "SEC Documents").
(i) As of its filing date, each SEC Document filed pursuant to
the Securities Exchange Act of 1934, as amended the ("1934 Act") did not contain
any untrue statement of a material fact or omit to state any material fact
necessary in order to make the statements therein, in the light of the
circumstances under which they were made, not misleading, except to the extent
that such statements have been modified or superseded by a later filed SEC
Document.
(ii) Each SEC Document that is a registration statement, as
amended or supplemented, if applicable, filed pursuant to the 1933 Act as of the
date such registration statement or amendment became effective did not contain
any untrue statement of a material fact or omit to state any material fact
required to be stated therein or necessary to make the statements therein not
misleading, except to the extent that such statements have been modified or
superseded by a later filed SEC Document.
(p) BULK TRANSFER. Parent or Purchaser will obtain bulk transfer and
related approvals prior to Closing, where Parent or Purchaser are required to do
so under the laws of any state.
(q) PURCHASER. Purchaser is a newly formed, direct wholly-owned
Subsidiary of Parent that has engaged in no business activities other than as
specifically contemplated by this Agreement.
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(r) STATEMENTS AND OTHER DOCUMENTS NOT MISLEADING. This Agreement,
including all Schedules, and any other document or instrument heretofore or
hereafter furnished by Purchaser to Seller in connection with the transactions
contemplated hereby does not and will not contain any untrue statement of any
material fact or omits or will omit to state any material fact required to be
stated in order to make such statement, document or other instrument not
misleading.
ARTICLE 3
COVENANTS AND ADDITIONAL AGREEMENTS
3.1 ACCESS TO INFORMATION; NOTICE OF CHANGES.
(a) During the period commencing on the date hereof and ending on the
Closing Date, Seller shall, upon reasonable notice, afford Parent, Purchaser,
and their counsel, accountants and other authorized representatives, reasonable
access during normal business hours to the properties, books and records of
Seller relating to the Business in order that it may have the opportunity to
make such investigations as it shall desire of the affairs of the Business; such
investigation shall not, however, affect the representations and warranties made
by Seller in this Agreement. During the period commencing on the date hereof and
ending on the Closing Date, Seller shall cause its officers and employees to use
its commercially practicable and reasonable efforts to cause its independent
accountants to furnish such additional financial and operating data and other
information and respond to such inquiries as Parent or Purchaser shall
reasonably request and to consult with Parent and Purchaser on all matters
respecting the Business and its operations. During the period commencing on the
date hereof and ending on the Closing Date, Seller shall deliver to Parent and
Purchaser the monthly financial statements normally prepared in connection with
the Business as promptly as practicable after the end of each calendar month
(and, in any event, within thirty (30) days after the end of each month).
(b) During the period commencing on the date hereof and ending on the
Closing Date, Parent shall, upon reasonable notice, afford Seller, and its
counsel, accountants and other authorized representatives, reasonable access
during normal business hours to the properties, books and records of Parent in
order that it may have the opportunity to make such investigations as it shall
desire of the affairs of the Parent; such investigation shall not, however,
affect the representations and warranties made by the Parent and Purchaser in
this Agreement. During the period commencing on the date hereof and ending on
the Closing Date, Parent shall cause its officers and employees to use its
commercially practicable and reasonable efforts to cause its independent
accountants, to furnish such additional financial and operating data and other
information and respond to such inquiries as Seller shall reasonably request and
to consult with Seller on all matters respecting its operations.
(c) During the period commencing on the date hereof and ending on the
Closing Date, Seller shall promptly notify Parent in writing of any and all
occurrences which, if they had occurred prior to execution of this Agreement,
would have caused the repre-
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sentations and warranties of Seller contained in Section 2.1 and the Seller
Disclosure Schedule delivered in conjunction therewith to be incorrect in any
material respect.
(d) During the period commencing on the date hereof and ending on the
Closing Date, Parent shall promptly notify Seller in writing of any and all
occurrences which, if they had occurred prior to execution of this Agreement,
would have caused the representations and warranties of Parent or Purchaser
contained in Section 2.2 and the Schedules and Parent Disclosure Schedule
delivered in conjunction therewith to be incorrect in any material respect.
3.2 CONFIDENTIALITY. Unless mutually agreed in advance, the parties and
their agents and representatives will keep all details pertaining to the
Acquisition in strict confidence, except such notices and disclosures necessary
to effect the transactions contemplated herein. Following the execution of this
Agreement, Purchaser shall be entitled to announce the Acquisition to comply
with any applicable legal requirements, provided that the text of any press
release or other announcement shall be subject to Seller's extremely timely and
reasonable approval.
3.3 CONDUCT OF THE BUSINESS PENDING THE CLOSING DATE. Except as expressly
permitted by this Agreement, or in the Ordinary Course of Business, or unless
otherwise consented to or approved in advance and in writing by parent, during
the period commencing on the date hereof and ending on the Closing Date:
(a) Seller shall cause the Business to be conducted in a manner
consistent with past practices (subject, in any event, to the provisions of
paragraph (b) below), shall use its reasonable commercial efforts to preserve
intact the business organization, and availability of services of the Employees,
and maintain satisfactory relationships with vendors, manufacturers, licensors,
suppliers, distributors, customers, and clients of the Business; and
(b) In the operation and conduct of the Business, Seller shall not
(i) enter into any material contract or commitment outside the Ordinary Course
of Business, including, without limitation, for any acquisition or disposition
of a material amount of assets; (ii) terminate operations at any site where the
operations of the Business are currently being conducted or commence operations
for the Business at any site where operations are not currently being conducted;
(iii) enter into, terminate, assign or sublease any lease of real property
relating to the Business; (iv) subject or allow the Acquired Assets to be
subjected to any Encumbrance other than Permitted Encumbrances; (v) agree to the
settlement of any litigation; or (vi) agree, in writing or otherwise, to take
any of the foregoing actions.
(c) Seller shall not take any action, engage in any transactions, or
enter into any agreement that would cause any of the representations or
warranties set forth in Section 2.1 hereof to be untrue in any material respect
as of the Closing Date.
3.4 CONDUCT OF PARENT PENDING THE CLOSING DATE. Except as expressly
permitted by this Agreement, during the period commencing on the date hereof and
ending on the Closing
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Date, Parent shall conduct its business only in the Ordinary Course of Business,
unless otherwise consented to or approved in advance and in writing by Seller.
Parent shall not take any action, engage in any transactions, or enter into any
agreement that would reasonably be expected to cause any of the representations
or warranties set forth in Section 2.2 hereof to be untrue in any material
respect as of the Closing Date.
3.5 COMMERCIAL EFFORTS. Subject to the terms and conditions herein
provided, each of Seller and Purchaser shall cooperate and use their respective
reasonable and commercially practicable efforts to take, or cause to be taken,
all appropriate action, and to make, or cause to be made, all filings necessary,
proper or advisable under applicable laws and regulations to consummate and make
effective the transactions contemplated by this Agreement, including, without
limitation, their respective reasonable and commercially practicable efforts to
obtain, prior to the Closing Date, all licenses, permits, approvals,
authorizations, qualifications and orders of governmental authorities and
consents of parties to any Assumed Contract to permit the transfer thereof as
may be necessary for the consummation of the transactions contemplated by this
Agreement and to fulfill the conditions to the Acquisition and to rectify any
event or circumstance which could impede consummation of the transactions
contemplated by this Agreement; PROVIDED, HOWEVER, that (a) no party shall be
under an obligation hereunder to undertake any effort, incur any expense or
provide cooperation to any other party to assist or enable such other party to
perform its unconditional obligations hereunder or to rectify the default of or
breach by any such other party of any such obligation; and (b) no contract shall
be amended or modified to increase the amount payable thereunder or otherwise to
become more burdensome in order to obtain any such consent, approval or
authorization without the prior written approval of Parent or Purchaser.
3.6 NO SOLICITATION OF OTHER OFFERS. Seller agrees that until Closing or
termination of this Agreement, neither it nor any of its respective officers,
directors, employees, representatives, investment bankers, attorneys,
accountants, brokers, advisors, or other agents or affiliates, shall, directly
or indirectly, take any action to encourage, solicit, initiate, or participate
in any way in discussions or negotiations with, or furnish any information to,
or afford any access to the properties, books, or records of the Business to, or
otherwise assist, facilitate or encourage, any person or entity (other than
Parent, Purchaser, their officers, directors, advisors, representatives, agents,
affiliates, or associates) in connection with any possible or proposed merger,
consolidation, business combination, liquidation, acquisition, sale or other
disposition of assets, sale of shares of capital stock or similar transactions
involving the Business.
3.7 NON-SOLICITATION.
(a) Seller hereby agrees that it shall not, during the 24
(twenty-four) month period following the Closing Date, directly or indirectly,
solicit any employee of Parent or Purchaser for employment by Seller; provided,
however, that nothing herein shall preclude Seller from soliciting for
employment or hiring any such employee (i) whose employment with Purchaser has
been involuntarily terminated by Purchaser or is terminated as a result of an
employment termination offer from Purchaser or (ii) by mutual agreement of
Purchaser and Seller.
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(b) Parent and Purchaser hereby agree that they shall not, during the
24 (twenty-four) month period following the Closing Date, directly or
indirectly, solicit any employee of Seller for employment by Purchaser;
provided, however, that nothing herein shall preclude Parent and Purchaser from
soliciting for employment or hiring (i) any such employee whose employment with
Seller has been involuntarily terminated by Seller or is terminated as a result
of an employment termination offer from Seller, (ii) any such employee by mutual
agreement of Seller and Purchaser, (iii) Xxxxx Xxxxx, or (iv) Xxxxxxx
Xxxxxxxxxxxxxx,.
7.10. COVENANT TO SATISFY CONDITIONS.
(a) Seller will use reasonably and commercially practicable efforts
to perform or cause to be satisfied each covenant or condition to be performed
or satisfied by it prior to the Closing Date as contemplated by this Agreement.
(b) Parent and Purchaser will use reasonably and commercially
practicable efforts to perform or cause to be satisfied each covenant or
condition to be performed or satisfied by them prior to the Closing Date as
contemplated by this Agreement.
3.9 SALES AND USE TAXES. Seller shall discharge, pay and satisfy (and hold
Parent and Purchaser totally free and harmless from) any sales and/or use taxes
due or determined to be due to the State of New Jersey, and to any political
subdivision thereof, as a result of the Acquisition, except where (i) such taxes
are due or determined to be due on account of the Parent or Purchaser's failure
to apply for and obtain an exemption under the bulk sales provision of New
Jersey law, and (ii) a use tax is imposed on Purchaser as a result of its use of
the Acquired Assets in the state of New Jersey, and not as a result of the
Acquisition.
3.10 EMPLOYEES. Seller covenants not to interfere with any attempts by the
Purchaser to hire or otherwise retain the services of the Employees and Seller
will recommend that each Employee accept the employment offer of Purchaser.
3.11 UPDATED SCHEDULES.
(a) The Seller Disclosure Schedule shall be updated by Seller (the
"Updated Seller Disclosure Schedule") and delivered to Parent and Purchaser at
the Closing. The Updated Seller Disclosure Schedule shall be updated as of the
Closing Date to reflect changes occurring between the date hereof and the
Closing Date to the information set forth in response to the corresponding
representations and warranties; provided, however, that no such changes or
Updated Seller Disclosure Schedule shall affect the representations and
warranties (and corresponding Seller Disclosure Schedule) made as of the date
hereof.
(b) The Parent Disclosure Schedule shall be updated by Parent and
Purchaser (the "Updated Parent Disclosure Schedule") and delivered to Seller at
the Closing. The Updated Parent Disclosure Schedule shall be updated as of the
Closing Date to reflect changes occurring between the date hereof and the
Closing Date to the information set forth in response to the corresponding
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representations and warranties; provided, however, that no such changes or
Updated Parent Disclosure Schedule shall affect the representations and
warranties (and corresponding Parent Disclosure Schedule) made as of the date
hereof.
ARTICLE 4
CONDITIONS PRECEDENT TO ACQUISITION; DELIVERIES AT CLOSING
4.1. CONDITIONS PRECEDENT TO OBLIGATIONS OF PARENT, PURCHASER AND SELLER.
The respective obligations of Parent, Purchaser and Seller to effect the
Acquisition are subject to the satisfaction or waiver (subject to applicable
law) at or prior to the Closing Date of each of the following conditions:
(a) INJUNCTION. No preliminary or permanent injunction or other order
shall have been issued by any court or by any governmental or regulatory agency,
body or authority which prohibits the consummation of the Acquisition, the Share
Purchase or the other transactions contemplated by this Agreement and which is
in effect at the Closing Date;
(b) STATUTES. No statute, rule, regulation, executive order, decree,
or order of any kind shall have been enacted, entered, promulgated, or enforced
by any court or governmental authority that remains in force and prohibits the
consummation of the Acquisition, the Share Purchase or the other transactions
contemplated by this Agreement.
(c) HSR ACT. Any waiting period applicable to the consummation of the
Acquisition and the Share Purchase under the HSR Act shall have expired or been
terminated, and no action shall have been instituted by the Federal Trade
Commission or the Department of Justice challenging or seeking to enjoin the
consummation of the Acquisition, which action shall not have been withdrawn or
terminated.
4.2. CONDITIONS PRECEDENT TO OBLIGATIONS OF PARENT AND PURCHASER. The
obligation of Parent and Purchaser to effect the Acquisition and the Share
Purchase shall be subject to the satisfaction, at or prior to the Closing Date,
of each of the following conditions unless waived by Parent and Purchaser in
their discretion:
(a) ACCURACY OF REPRESENTATIONS AND WARRANTIES. All representations
and warranties of Seller contained herein shall be true and correct in all
respects as of the date hereof and at and as of the Closing, with the same force
and effect as though made on and as of the Closing Date, (except to the extent
expressly made as of an earlier date), except where the failure of such
representations and warranties to be so true and correct does not have, and is
not likely to have, a Material Adverse Effect on the Business.
(b) SELLER'S PERFORMANCE. Seller shall have performed in all material
respects all obligations and agreements, and complied in all material respects
with all covenants and con-
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ditions, contained in this Agreement to be performed or complied with by it
prior to the Closing Date.
(c) EXECUTION OF XXXX OF SALE AND ASSIGNMENT. Seller shall have
executed and delivered the Xxxx of Sale and Assignment referenced in
Section 1.3.
(d) CONTRACT CONSENTS. Seller shall have obtained all consents, on
terms and conditions reasonably satisfactory to Purchaser, required in respect
of the assignment and transfer all of the Assumed Contracts, if required by the
terms thereof to effect a valid and enforceable transfer of the same.
(e) LEGAL OPINIONS. Parent and Purchaser shall have received from
counsel to Seller an opinion with respect to the matters set forth on SCHEDULE
4.2(E), which is attached hereto.
(f) EXECUTION AND DELIVERY OF OTHER CONTRACTS, DOCUMENTS, AND
CERTIFICATES BY SELLER. Seller shall have executed and/or delivered all of the
following to Parent and Purchaser:
o Purchase Price Allocation on Schedule 1.2(c);
o All agreements referenced in Section 1.2(d);
o Assignment and Assumption Agreement and related attachments on
Schedule 1.3(b);
o Updated Seller Disclosure Schedule;
o Good Standing Certificate of Seller;
o Unanimous Written Consent of the Board of Directors of Seller;
o Officer Certificate of Seller certifying that the representations
and warranties made by Seller in Article 2 hereof are true and
correct as of the Closing Date (except to the extent expressly made
as of an earlier date), except where the failure of such
representations and warranties to be so true and correct does not
have, and is not likely to have, individually or in the aggregate,
a Material Adverse Effect on the Business, and that Seller has
performed in all material respects all obligations and conditions
herein required to be performed or observed by Seller prior to the
Closing;
o Officer Certificate certifying to receipt of Consents to Assignment
to all Assumed Contracts referenced in Section 4.2(d)above; and
o Audited Financial Statements of the Business;
4.3. CONDITIONS PRECEDENT TO OBLIGATION OF SELLER. The obligation of Seller
to consummate the Acquisition and Share Purchase shall be subject to the
satisfaction, at or prior to the Closing Date, of each of the following
conditions unless waived by Seller in its discretion:
(a) ACCURACY OF REPRESENTATIONS AND WARRANTIES. All representations
and warranties of Parent and Purchaser contained herein shall be true and
correct in all material respects as of the date hereof and at and as of the
Closing, with the same force and effect as though made
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on and as of the Closing Date, except to the extent expressly made as of an
earlier date), except where the failure of such representations and warranties
to be so true and correct does not have, and is not likely to have, a Material
Adverse Effect on Parent.
(b) PARENT'S AND PURCHASER'S PERFORMANCE. Parent and Purchaser shall
have performed in all material respects all obligations and agreements, and
complied in all material respects with all covenants and conditions, contained
in this Agreement to be performed or complied with by them prior to the Closing
Date.
(c) LEGAL OPINION. Seller shall have received from counsel to Parent
and Purchaser an opinion with respect to the matters set forth on Schedule
4.3(c), which is attached hereto.
(d) PARENT SHARES. The APSCP for the Parent Common Stock on the
NASDAQ National Market for the ten (10) trading days immediately preceding the
Closing shall be at least $11.05.
(e) EXECUTION AND DELIVERY OF OTHER CONTRACTS, DOCUMENTS, AND
CERTIFICATES BY PARENT AND PURCHASER. Parent and Purchaser shall have executed
and/or delivered all of the following to Seller:
o Purchase Price Allocation on Schedule 1.2(c);
o All agreements referenced in Section 1.2(d);
o Assignment and Assumption Agreement and related attachments on
Schedule 1.3(b);
o Updated Parent Disclosure Schedule
o Good Standing Certificates of Parent and Purchaser;
o Unanimous Written Consent of the Boards of Directors of Parent and
Purchaser;
o Officer's Certificates of Parent and Purchaser certifying that the
representations and warranties made by Parent and Purchaser in
Article 2 hereof are true and correct as of the Closing Date
(except to the extent expressly made as of an earlier date), except
where the failure of such representations and warranties to be so
true and correct does not have, and is not likely to have,
individually or in the aggregate, a Material Adverse Effect on
Parent, and that Parent and Purchaser have performed in all
material respects all obligations and conditions herein required to
be performed or observed by Parent and Purchaser prior to the
Closing; and
o Parent Certificate for the Parent Shares.
4.4 EFFECT OF WAIVER. The waiver by Parent and Purchaser of a condition set
forth in Section 4.2 or by Seller of a condition set forth in Section 4.3 shall
not constitute a waiver by the party waiving a condition of any of its other
rights or remedies, at law or in equity, if the other
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party or parties shall be in default of any of its or their representations,
warranties, or covenants under this Agreement.
ARTICLE 5
SURVIVAL; INDEMNIFICATION; EXPENSES
5.1 INDEMNIFICATION BY SELLER.
Subject to the terms and conditions set forth herein, from and after
the Closing Date, Seller shall defend, indemnify, and hold harmless Parent and
Purchaser and their affiliates, officers, directors, employees, and controlling
persons (the "Purchaser Indemnitees") from any Liability, damage, deficiency,
loss, Taxes, penalty, judgments, assessments, cost, or expense, including
reasonable attorneys' fees and costs of investigating and defending against
lawsuits, complaints, actions, administrative proceedings or other pending or
threatened litigation, (being hereafter collectively referred to as "Purchaser
Damages") actually suffered or paid by them as a result of:
(a) Any breach of any representation or warranty made by Seller in
this Agreement, in the Seller Disclosure Schedule or the Updated Seller
Disclosure Schedule, or in any Schedule, exhibit, certificate, agreement,
instrument or other document entered into or delivered pursuant hereto by
Seller;
(b) Any breach of any term, provision, instrument, covenant or
agreement to be performed or observed by Seller pursuant to this Agreement, the
Seller Disclosure Schedule or the Updated Seller Disclosure Schedule, or any
Schedule, exhibit, certificate, agreement, instrument or other document entered
into or delivered pursuant hereto by Seller.
(c) Any Liability relating to the Business other than the Assumed
Liabilities;
(d) The conduct or operations of the Business on or prior to the
Closing Date; and
(e) Any Liability (other than an Assumed Liability) incurred by
Purchaser as a result of Seller's failure to comply with the New Jersey Tax and
Bulk Transfer Law.
5.2. INDEMNIFICATION BY PARENT AND PURCHASER. Parent and Purchaser shall
jointly and severally defend, indemnify and hold harmless Seller and its
affiliates, officers, directors, employees and controlling persons (the "Seller
Indemnitees") from any Liability, damage, deficiency, loss, Taxes, penalty,
judgments, assessments, cost, or expense, including reasonable attorneys' fees
and costs of investigating and defending against lawsuits, complaints, actions,
administrative proceedings or other pending or threatened litigation (being
hereafter collectively referred to as "Seller Damages") actually suffered or
paid by Seller as a result of:
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(a) Any breach of any representation or warranty made by Parent or
Purchaser in this Agreement, in the Parent Disclosure Schedule or the Updated
Parent Disclosure Schedule, or in any Schedule, exhibit, certificate, agreement,
instrument, or other document entered into or delivered pursuant hereto by
Parent or Purchaser;
(b) Any breach of any term, provision, instrument, covenant or
agreement to be performed or observed by Parent or Purchaser pursuant to this
Agreement, the Parent Disclosure Schedule or the Updated Parent Disclosure
Schedule, or any Schedule, exhibit, certificate, agreement, instrument, or other
document entered into or delivered pursuant hereto by Parent or Purchaser;
(c) Any Liability which is an Assumed Liability; and
(d) The conduct or operations of the Business after the Closing Date
except to the extent the matter constitutes a breach of a representation or
warranty of Seller contained herein.
(e) Any Liability incurred by Seller as a result solely of the timing
of the relevant filing with the state of New Jersey, Department of the Treasury,
Division of Taxation of a Notification of Sale, Transfer, or Assignment in Bulk
by Purchaser.
5.3. Limitations.
(a) Seller's obligation to indemnify the Purchaser Indemnitees
pursuant to Section 5.1 hereof is subject to the following limitations:
(i) no indemnification pursuant to Section 5.1 hereof shall be
made by Seller unless the aggregate amount of Purchaser Damages exceeds
$350,000, each individual amount of Purchaser Damages exceeds $50,000 and, in
such event, indemnification shall be made by Seller only to the extent that the
aggregate amount of Purchaser Damages exceed $350,000; it is acknowledged that
Parent and Purchaser shall not have the right to indemnification for individual
amounts below $50,000 and that such amounts shall not count towards the $350,000
threshold amount referenced in this clause (i);
(ii) in no event shall Seller's aggregate obligation to indemnify
the Purchaser Indemnitees pursuant to Section 5.1 hereof exceed 25% of the value
of the Parent Shares as of the Closing Date;
(iii) the amount of any Purchaser Damages shall be reduced by (A)
any amount received by a Purchaser Indemnitee with respect thereto under any
insurance coverage or from any other party alleged to be responsible therefor
and (B) the amount of any Tax Benefit Actually Realized available to the
Purchaser Indemnitee relating hereto. The Purchaser Indemnitees shall use
reasonable efforts to collect any amounts available under such insurance
coverage or from such other party alleged to have responsibility. If a Purchaser
Indemnitee receives any amount under insurance coverage or from such other party
with respect to Purchaser at any time subsequent to any indemnification provided
by Seller pursuant to this Section 5.3, then such Purchaser Indemnitee shall
promptly reimburse Seller for any payment made or expense incurred by
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Seller in connection with providing such indemnification up to such amount
received by the Purchaser Indemnitees.
(b) Parent and Purchaser's obligation to indemnify the Seller
Indemnitees pursuant to Section 5.2 hereof is subject to the following
limitations:
(i) no indemnification pursuant to Section 5.2 hereof shall be
made by Parent or Purchaser unless the aggregate amount of Seller Damages
exceeds $350,000, each individual amount of Seller Damages exceeds $50,000 and,
in such event, indemnification shall be made by Parent or Purchaser only to the
extent that the aggregate amount of Seller Damages exceed $350,000; it is
acknowledged that Seller shall not have the right to indemnification for
individual amounts below $50,000 and that such amounts shall not count towards
the $350,000 threshold amount referenced in this clause (i);
(ii) in no event shall Parent or Purchaser's aggregate obligation
to indemnify the Seller Indemnitees pursuant to Section 5.2 hereof exceed 25% of
the value of the Parent Shares as of the Closing Date;
(iii) the amount of any Seller Damages shall be reduced by (A)
any amount received by a Seller Indemnitee with respect thereto under any
insurance coverage or from any other party alleged to be responsible therefor
and (B) the amount of any Tax Benefit Actually Realized available to the Seller
Indemnitee relating hereto. The Seller Indemnitees shall use reasonable efforts
to collect any amounts available under such insurance coverage or from such
other party alleged to have responsibility. If a Seller Indemnitee receives any
amount under insurance coverage or from such other party with respect to Seller
at any time subsequent to any indemnification provided by Parent or Purchaser
pursuant to this Section 5.3, then such Seller Indemnitee shall promptly
reimburse Parent or Purchaser for any payment made or expense incurred by Parent
or Purchaser in connection with providing such indemnification up to such amount
received by the Seller Indemnitees.
5.4. CONDUCT OF LITIGATION.
Any party against whom a claim is asserted, promptly after receipt of
notice of the commencement or threat of any such claim in respect of which
indemnification may be sought hereunder (the "Indemnified Party"), shall notify
the other party (the "Indemnifying Party") in writing of the commencement or
threat thereof. The failure of the Indemnified Party to so notify the
Indemnifying Party shall not relieve the Indemnifying Party of its obligation to
indemnify PI the Indemnified Party and shall not relieve the Indemnifying Party
of any other liability which any of them may have to the Indemnified Party,
except to the extent such failure to notify results in actual damage or
prejudice to the Indemnifying Party over and above any amount for which the
Indemnifying Party would otherwise have been responsible under Article 5 of this
Agreement. In the event of the commencement of any such action as to which the
Indemnified Party notifies the Indemnifying Party as aforesaid, the Indemnifying
Party will be entitled to participate therein and to assume the defense thereof
at its expense, provided that the Indemnifying Party
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promptly notify the Indemnified Party of its election so to assume the defense
thereof. Nothing herein shall be construed so as to give any insurance carrier a
right of subrogation for claims paid except as such right would otherwise exist
in the absence of Article 5 of this Agreement.
The Indemnified Party shall be entitled to participate in the defense
of any action and to be represented by counsel of its own selection. If the
attorneys provided for the defense of the Indemnified Party by the Indemnifying
Party withdraw from or are removed by court order from the Indemnified Party's
representation, or if either equitable relief is being sought or the Indemnified
Party is also joined as a party in any such action, then the cost of counsel
selected by the Indemnified Party shall be part of the Indemnified Party's cost,
and the Indemnified Party shall have the right in all respects to conduct its
own defense. If the Indemnified Party otherwise retains its own counsel, the
cost thereof shall be for the account of the Indemnified Party.
As to cases in which the Indemnifying Party has assumed and is
providing the defense for the Indemnified Party, except with respect to causes
of action alleged separately against the Indemnified Party, the handling and
decisions in respect of which shall be under the sole and exclusive control of
the Indemnified Party, the control of such defense and the right to reach a
settlement in such action shall remain vested in the Indemnifying Party. As to
any action in which the Indemnified Party is not represented by counsel of its
own selection, the Indemnifying Party shall provide to the Indemnified Party
reasonable information (including reasonable advance notice of all proceedings
in respect thereto) regarding the conduct of the action and the right to attend
all proceedings and depositions in respect thereto through its agents and
attorneys, and the right to discuss the action with counsel for the Indemnifying
Party, and the Indemnifying Party will consider the Indemnified Party's view
with respect to the conduct of the action. Except as provided in the first
sentence of this paragraph above, the Indemnifying Party shall at all times be
entitled to make all decisions regarding the action, including settlements;
provided, that, if the Indemnified Party objects to a settlement which has
otherwise been fully agreed to but for this provision, the Indemnified Party may
prohibit the Indemnifying Party from making such settlement in the Indemnified
Party's behalf, in which case, at the election of the Indemnifying Party, the
Indemnifying Party may pay to the Indemnified Party the proposed cost to them of
such settlement, in cash, and the Indemnified Party shall thereafter be
responsible for such litigation matter and the Indemnifying Party thereafter has
no further indemnification responsibility with respect to such matter.
If, within twenty (20) days after receipt by the Indemnifying Party
of notice from the Indemnified Party to the Indemnifying Party as to
commencement of any action in respect of which indemnification is sought
hereunder, the Indemnifying Party has not notified the Indemnified Party that
the Indemnifying Party assumes the defense of such action without reservation
and have actually assumed such defense, then the Indemnified Party shall have
the right to defend such action and totally to control such defense, and to
proceed immediately against the Indemnifying Party to enforce all
indemnification rights hereunder (including but not limited to the costs of
defense, as the same may be incurred), and the Indemnifying Party shall
thereafter not be entitled to participate in such action. The indemnification
obligations of the Indemnifying Party with respect to such action shall,
however, in no way be diminished by virtue of the foregoing, and the fact that
the Indemnified Party shall have defended, settled, compromised or otherwise
dealt with such action shall not, in any circumstances, be deemed to constitute
any waiver, release, or exon-
-31-
eration of the Indemnifying Party from its indemnification obligations,
regardless of the outcome of such action.
5.5. SURVIVAL OF REPRESENTATIONS AND WARRANTIES.
(a) All representations and warranties herein or in any, Schedule,
the Seller Disclosure Schedule, the Parent Disclosure Schedule, any Exhibit,
certificate, agreement, instrument or other document entered into or delivered
pursuant hereto by a party shall survive the execution and delivery of this
Agreement. No claim for Seller Damages or Purchaser Damages may be made by any
Purchaser Indemnitee or Seller Indemnitee, as applicable, unless written notice
of such claim is given to the party claimed against prior to the end of the
applicable survival period (as provided for in (b) below).
(b) The representations and warranties set forth in this Agreement
shall survive for 12 months after the Closing Date, except for the
representations and warranties set forth in Sections 2.1(i) (Title to
Properties; Encumbrances), 2.2(b) (Capitalization), and 2.2(k) (Taxes), which
shall survive the execution and delivery of this Agreement until ten (10) days
following the expiration of the time period which is prescribed by the
applicable federal, state or local statute of limitations with respect to which
a third party may make a claim relating to such matters. For purposes of the
preceding sentence, the duration of an applicable statute of limitation shall be
unaffected by any extension or other agreement entered into or consented to in
writing by Purchaser affecting such duration.
5.6. NO DUPLICATION; SOLE REMEDY.
(a) Parent's, Purchaser's and Seller's respective rights to
indemnification as provided for in Sections 5.1 and 5.2, as applicable, shall
constitute such party's sole remedy for such a breach and the breaching party
shall have no further liability or damages to the other party resulting from the
breach; provided, however, that nothing contained herein shall prevent an
indemnified party from pursuing remedies as may be available to such party under
applicable law in the event of an indemnifying party's failure to comply with
its indemnification obligations hereunder.
5.7. PAYMENTS. Payments due by Seller under this Article 5 may, by mutual
agreement, be made in (i) cash, (ii) shares of Parent Common Stock valued at the
APSCP of the Parent Common Stock for the ten (10) trading days immediately
preceding the date of payment or (iii) a combination of cash and Parent Common
Stock.
ARTICLE 6
TERMINATION AND ABANDONMENT
6.1. TERMINATION. This Agreement may be terminated and the transactions
contemplated hereby may be abandoned:
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(a) at any time prior to the Closing Date, by mutual consent of the
parties;
(b) by either Purchaser and Parent or Seller if the Closing shall not
have occurred by July 31, 2000, unless extended by mutual agreement of the
parties;
(c) by Parent and Purchaser, if there has been a breach of a
representation or warranty in this Agreement (including the Seller Disclosure
Schedule, the Updated Seller Disclosure, or any Schedules) or any certificate,
instrument or other document delivered pursuant hereto by Seller, in any
material respect or a breach by Seller of any covenant of Seller set forth
herein in any material respect, which breach or failure to perform (I) would
give rise to a failure of any condition to which the obligations of Parent and
Purchaser hereunder are subject, and (ii) cannot be or has not been cured within
30 days after the giving of written notice to Seller;
(d) by Seller, if there has been a breach of a representation or
warranty in this Agreement (including the Parent Disclosure Schedule, the
Updated Parent Disclosure Schedule or any Schedules) or any certificate,
instrument or other document delivered pursuant hereto by Parent or Purchaser in
any material respect, or a breach by Parent or Purchaser of any covenant of
Parent or Purchaser set forth herein in any material respect, which breach or
failure to perform (i) would give rise to the failure of any condition to which
the obligations of Seller hereunder are subject, and (ii) cannot be or has not
been cured within 30 days after the giving of written notice to Parent or
Purchaser; or ;
(e) by Parent and Purchaser, on the one hand, or Seller, on the other
hand, if any court of competent jurisdiction in the United States, or other
United States governmental body shall have issued an order, decree or ruling or
taken any other action permanently restraining, enjoining or otherwise
prohibiting the Acquisition and such order, decree, ruling or other action shall
have become final and unappealable.
6.2. EFFECT OF TERMINATION. In the event of the termination of this
Agreement pursuant to Section 6.1 hereof by Parent and Purchaser, on the one
hand, or Seller, on the other hand, written notice thereof promptly shall be
given to the other party or parties specifying the provision hereof pursuant to
which such termination is made, and this Agreement shall become void and have no
effect (other than Sections 3.2 and 7.1 hereof, which shall survive
termination), and there shall be no liability hereunder on the part of Parent
and Purchaser, or Seller, provided that if Parent and Purchaser terminate this
Agreement pursuant to Section 6.1(c) or if Seller terminates this Agreement
pursuant to Section 6.1(d), then the terminating party shall have the right to
pursue an indemnification claim pursuant to Article V hereof notwithstanding
that the Closing shall not have occurred. Termination of this Agreement shall
have no effect on the obligations of the parties arising under Section 3.2
hereof.
6.3. EXTENSION; WAIVER. At any time prior to the Closing Date, the parties
hereto, by action taken by or on behalf of the respective authorized officers of
Seller or Parent and Purchaser, may (i) extend the time for the performance of
any of the obligations or other acts of the other parties hereto, or (ii) waive
compliance with any of the agreements or conditions contained
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herein. Any agreement on the part of any party to any such extension or waiver
shall be valid only if set forth in an instrument in writing signed on behalf of
such party for whose benefit such agreement or condition was made or
established.
ARTICLE 7
MISCELLANEOUS
7.1. FEES AND EXPENSES. All costs and expenses incurred in
connection with this Agreement and the consummation of the transactions
contemplated hereby shall, if incurred by Parent or Purchaser, be paid by Parent
or Purchaser and shall, if incurred by Seller, be paid by the Seller. Parent and
Seller shall each contribute and pay one-half of the HSR Act filing fees
applicable, and one-half of professional accountant fees associated with the
preparation of the audited Financial Statements referenced herein.
7.2 PUBLIC ANNOUNCEMENTS. If requested by Parent, Seller shall
agree to and shall provide relevant information for any press release announcing
this Agreement and the transactions contemplated herein.
7.3. NOTICES. All notices, requests, demands, waivers and other
communications required or permitted to be given under this Agreement shall be
in writing and shall be deemed to have been duly given if delivered in person or
mailed, certified or registered mail with postage prepaid, or sent by courier
service, telex, telegram, or fax, as follows:
(a) if to Seller:
Telcordia Technologies, Inc.
000 Xxxxx Xxxxxx
Xxxxxxxxxx, Xxx Xxxxxx 00000
Attention: Xxxx X. Xxxxx, Xx., Esq.
Telephone: (000) 000-0000
Fax: (000) 000-0000
With a copy to:
(which shall not constitute notice)
Weil, Gotshal & Xxxxxx LLP
000 Xxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: Xxxxxx Xxxxxxxxxx, Esq.
Telephone: (000) 000-0000
Fax: (000) 000-0000
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(b) if to Parent or Purchaser:
Geoworks Corporation
000 Xxxxxxxx Xxxxxx
Xxxxxxx, Xxxxxxxxxx 00000
Attention: Xxxxx Xxxxx, Esq.
Telephone: (000) 000-0000
Fax: (000) 000-0000
with a copy to:
(which shall not constitute notice)
Xxxxx Xxxx LLP
0000 Xxxx Xxxxxx, Xxxxx 000
Xxxxxx, Xxxxxxxxxx 00000
Attention: Xxxxxxx X. Xxxx, Esq.
Telephone: (000) 000-0000
Fax: (000) 000-0000
or to such other Person or address as any party shall specify by notice in
writing to each of the other parties. All such notices, requests, demands,
waivers and communications shall be deemed to have been received on the date of
delivery if the date of transmission is electronically endorsed automatically on
the media or evidenced by courier service documentation. If notice is mailed or
transmitted in a manner in which date of delivery cannot be ascertained from the
media used or courier service records, notice shall be deemed given on the third
business day after the mailing or other transmission or delivery thereof. A
notice of a change of address shall be effective only upon receipt.
7.4 ENTIRE AGREEMENT. This Agreement, the Seller Disclosure Schedule,
the Updated Seller Disclosure Schedule, the Parent Disclosure Schedule, the
Updated Parent Disclosure Schedule, Schedules, Exhibits and other documents
referred to herein or delivered pursuant hereto collectively contain the entire
understanding of the parties hereto with respect to the subject matter contained
herein and supersede all prior and contemporaneous agreements and
understandings, oral and written, with respect thereto.
7.5 BINDING EFFECT; BENEFIT; ASSIGNMENT. This Agreement shall inure
to the benefit of and be binding upon the parties hereto and their respective
successors, heirs and permitted assigns. Neither this Agreement nor any of the
rights, interests or obligations hereunder shall be assigned or delegated by any
of the parties hereto without the prior written consent of the other parties;
PROVIDED, HOWEVER, Purchaser may elect to assign its rights hereunder to a
wholly-owned Subsidiary, which assignment shall not relieve or release Purchaser
of its obligations hereunder. Nothing in this Agreement, expressed or implied,
is intended to confer on any person, other than the parties hereto or their
respective successors and permitted assigns any rights, remedies, obligations or
liabilities.
-35-
7.6. AMENDMENT AND MODIFICATION. This Agreement may be amended,
modified, and supplemented only in writing signed by the parties hereto. Any
such amendment shall be authorized by the respective Boards of Directors of
Purchaser and Seller.
7.7. HEADINGS. The descriptive headings of the several Articles
and Sections of this Agreement are inserted for convenience only, do not
constitute a part of this Agreement and shall not affect in any way the meaning
or interpretation of this Agreement.
7.8. COUNTERPARTS; EXCHANGE OF SIGNATURE PAGES BY FAX. This
Agreement may be executed in several counterparts, each of which shall be deemed
to be an original, and all of which together shall be deemed to be an original,
and all of which together shall be deemed to be an original, and all of which
together shall be deemed to be one and the same instrument. This Agreement may
be executed by exchange of signature pages transmitted via fax with the same
force and effect as if original signatures on such pages were exchanged.
7.9. APPLICABLE LAW AND FORUM. This Agreement and the legal
relations between the parties hereto shall be governed by and construed in
accordance with the laws of the State of Delaware, without regard to the
conflict of laws rules thereof.
7.10. DISPUTE RESOLUTION.
(a) Any dispute, claim or controversy arising out of or
relating to this Agreement, or the interpretation or breach thereof, shall be
resolved as follows:
(i) For any litigation instituted by Parent or Purchaser
arising out of or relating to this Agreement, or the interpretation or breach
thereof, venue shall be in Xxxxxx County, New Jersey. For any litigation
instituted by Seller arising out of or relating to this Agreement, or the
interpretation or breach thereof, venue shall be in Alameda County, California.
(ii) Discovery in any action arising out of or in connection
with this Agreement shall be as provided for under the applicable rules of the
venue in which the action is filed, but limited to: (A) demands for inspection
of documents and things as provided for under the applicable rules of the venue
in which the action is filed; (B) the exchange of expert witness information and
the taking of depositions of designated experts as provided for under the
applicable rules of the venue in which the action is filed; and (C) for each
party, the depositions of no more than five (5) natural persons, exclusive of
experts. The parties waive the right to serve written interrogatories and
requests for admission.
(iii) The parties waive the right to trial by jury.
7.10. SEVERABILITY. If any term, provision, covenant, or restriction
contained in this Agreement is held by a court of competent jurisdiction or
other authority to be invalid, void, unenforceable or against its regulatory
policy, the remainder of the terms, provisions, covenants and
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restrictions contained in this Agreement shall remain in full force and effect
and shall in no way be affected, impaired or invalidated.
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IN WITNESS WHEREOF, each of the parties hereto has executed this
Agreement as of the date first above written.
GEOWORKS CORPORATION
By:
---------------------------------------
Name:
Title:
AIRBOSS ACQUISITION CORPORATION
By:
---------------------------------------
Name:
Title:
TELCORDIA TECHNOLOGIES, INC.
By:
---------------------------------------
Name: Xxxx Xxxx
Title: Chief Financial Officer
-38-
EXHIBIT 1.2(D)(I)
PATENT LICENSE AGREEMENT
THIS PATENT CROSS-LICENSE AGREEMENT, is made as of the 24 day of July, 2000 (the
"Effective Date"), by and among Geoworks Corporation, a Delaware corporation
having an office at 000 Xxxxxxxx Xxxxxx, Xxxxxxx XX, on behalf of itself and its
wholly owned subsidiary, AirBoss Acquisition Corporation, a New Jersey
corporation (collectively "Geoworks") and Telcordia Technologies, Inc., a
Delaware corporation, having its principal office at 000 Xxxxx Xxxxxx,
Xxxxxxxxxx, Xxx Xxxxxx 00000-0000 on behalf of itself and its parent company
Scientific Applications International Corporation, a Delaware Corporation,
(collectively "Telcordia"). Geoworks and Telcordia are sometimes individually
referred to as a "Party" and collectively as the "Parties."
RECITALS
Telcordia and Geoworks entered into an Asset Purchase and Stock Sale Agreement
dated July 21, 2000 (the "Purchase Agreement"), under which Geoworks purchased
from Telcordia all the application and middleware software of Telcordia's
Airboss Business Unit, which includes "AirBoss" application software and the
"AirForce" product solution and five related Telcordia Patents.
Telcordia has continuing operations, which may be related to the subject matter
of the Telcordia patents and therefore desires to retain rights under such
patents.
NOW THEREFORE, in consideration of the foregoing, the mutual promises contained
herein and other good and valuable consideration, the Parties agree as follows:
ARTICLE 1 - DEFINITIONS
1.1 LICENSED PATENTS shall mean the following listed US Patents and their
foreign counterparts which will be conveyed to Geoworks pursuant to the Asset
Transfer and Transaction Agreement executed at closing:
1. US Patent Number 5,327,486 entitled "Method and System for Managing
Telecommunications Such as Telephone Calls"
2. US Patent Number 5,673,322 entitled "System and Method for Providing
Protocol Translation and Filtering to Access the World Wide Web from
Wireless or Low-Bandwidth Networks"
3. US Patent Number 5,742,668 entitled "Electronic Messaging Network"
4. US Patent Number 5,742,905 entitled "Personal Communications
Internetworking"
5. US Patent Number 5,930,700 entitled "System and Method for
Automatically Screening and Directing Incoming Calls"
1.2 WAP PATENT shall mean the United States Patent 5,327,529 issued on July 5,
1994, and all continuations, continuation-in-part and divisional patents and all
foreign counterparts thereof.
1.3 TELCORDIA TECH ACCESS software product shall mean the software system
Telcordia purchased from BellSouth, including all improvements and enhancements
thereto, to provide wireless access to the Telcordia Force software system to
provide craftpersons access to a service provider's customer data and service
order records.
1.4 UNIFIED MESSAGING FUNCTIONALITY means any and all Telcordia software that
provides the ability of a user to receive and display on a singular device any
combination of voice, facsimile, email, video, or data messages.
ARTICLE 2 - LICENSE GRANT
2.1 GEOWORKS grants to TELCORDIA under the Licensed Patents the following
rights:
(i) Geoworks covenants not to xxx Telcordia and Telcordia's customers
for patent infringement (direct or indirect) under the network claims of the
Licensed Patents resulting from Telcordia's provision of systems integration
services or the provision of solutions worldwide,
(ii) a worldwide, nonexclusive, royalty free license under the Licensed
Patents to make, have made, use, sell, offer to sell or import the Telcordia
Tech Access software product, or any component thereof, or any existing
Telcordia Software Product existing as of the closing date Purchase Agreement
which are enhanced or improved to provide Unified Messaging Functionality, or to
operate a network for any purpose;
(iii) a nonexclusive, worldwide, license to make, have made, use, sell,
offer to sell or import products under the Licensed Patents any other products
or services, under terms, conditions and at a royalty rate equal to that offered
to Geoworks's most-favored-customers, or at a rate no greater than that which is
commercially reasonable; and
(iv) a perpetual right to acquire a nonexclusive, worldwide, license to
make, use, sell, offer to sell or import products under the WAP Patent at a 5%
discount from Geoworks then standard commercial rates.
2.2 Telcordia covenants not to xxx Geoworks or any Geoworks' customers under any
claim of patent infringement arising from Geoworks development, sale, license,
use, or offer to sell the AirBoss/AirForce software products conveyed to
Geoworks pursuant to the Purchase Agreement.
ARTICLE 3 - REPRESENTATIONS AND WARRANTIES, LIMITATIONS
3.1 Geoworks warrants that it has the right to grant the licenses and
rights granted herein and to enter into this Agreement. Telcordia warrants that
it has the right to enter into this Agreement for and on behalf of itself and
parent.
3.2 Geoworks has not and will not accept any commitments or restrictions
in respect to its right to grant licenses that will materially affect the value
of the rights granted by it in this Agreement.
3.3 Nothing in this Agreement shall be construed as
(i) a warranty or representation by either Party as to the validity or
scope of the Licensed Patents or of the WAP Patent.
(ii) a warranty or representation that anything made, used, sold, or
otherwise disposed of under any license granted in this Agreement shall be free
from infringement of third persons; or
(iii) a requirement that Geoworks shall maintain any patent in force;
(iv) an obligation to bring or prosecute actions or suites against
third parties or infringement of any patent; or
(v) an obligation to furnish any technical information related to any
licensed patent or any information concerning pending patent applications;
(vi) conferring a right to use in advertising, publicity, or otherwise
any trademark, or trade name of either Party; or
(vii) granting by implication, estoppel, or otherwise any licenses or
rights under patents other than the Licensed Patents or the right to acquire a
license under the WAP Patent.
3.4 EXCEPT FOR THE EXPRESS WARRANTIES OF SECTION 3.1, THERE ARE NO OTHER
WARRANTIES, EITHER EXPRESS OR IMPLIED, INCLUDING, BUT NOT LIMITED TO, THE
IMPLIED WARRANTIES OF MERCHANTABILITY AND FITNESS FOR ANY PARTICULAR PURPOSE,
EVEN IF GEOWORKS HAS BEEN MADE AWARE OF SUCH PURPOSE, AND THE WARRANTY AGAINST
INFRINGEMENT OF PATENTS OR OTHER INTELLECTUAL PROPERTY RIGHTS.
3.5 NEITHER PARTY NOR ITS AFFILIATES SHALL BE LIABLE FOR ANY INDIRECT
DAMAGES, INCLUDING ANY LOST PROFITS OR OTHER INCIDENTAL OR CONSEQUENTIAL
DAMAGES, ARISING OUT OF THIS AGREEMENT, INCLUDING THE USE OR INABILITY TO USE
ANY DEVICE, PRODUCT, SERVICE, OR PATENT.
ARTICLE 4 - TRANSFERABILITY OF RIGHTS AND OBLIGATIONS
4.1 Any license granted by this Agreement in respect to a Licensed Patents
shall be binding on any successor of the party in ownership or control of the
Licensed Patents.
4.2 The licenses received by Telcordia under this Agreement shall pass to
any assigns for the benefit of creditors of the licensed party, and to any
receiver of its assets, or to any person or corporation succeeding to any
business of Telcordia requiring the licenses granted hereunder, as a result of
sale, consolidation, reorganization, or otherwise, provided such assignee,
receiver, person or legal entity, shall, without delay, accept in writing the
provisions of this Agreement and agree to become bound in all respects thereby
in the place and state of the Telcordia, but may not otherwise be transferred
without the written consent of Geoworks.
ARTICLE 5 - NOTICES; APPLICABLE LAW
5.1 All notices, certificates, acknowledgments and other reports hereunder
must be in writing and will be deemed properly delivered when personally
delivered or upon confirmation of receipt of a certified mailing to the other
Party at its address as follows, or such other address as either Party may by
written notice, designate to the other:
Geoworks Corporation Telcordia Technologies, Inc.
000 Xxxxxxxx Xxx. Xxxxx Xxxxxxxxxx
Xxxxxxx, Xx. 00000 000 Xxxxx Xxxxxx
Xxxxxxxxx: Xxx Given, Esq. Xxxxxxxxxx, Xxx Xxxxxx 00000-0000
Telephone No. 000.000.0000 Attention: Xxx Xxxxxxxx, Esq.
Facsimile No. 000.000.0000 Telephone No. 000.000.0000
Facsimile No. 973.829.2366
WITH A COPY TO:
Xxxxx Xxxx, LLP
0000 Xxxx Xxxxxx
Xxxxx 000
Xxxxxx, Xxxxxxxxxx, 00000
Attn: Xxxxxxx X. Xxxx, Esq.
Telephone No. 000.000.0000
Facsimile No. 949.223.7100
5.2 This Agreement shall be construed, interpreted, and applied in
accordance with the substantive laws of the state of New York.
5.3 Either Party is free to publicize the fact that they have entered into
this agreement, provided any news releases, public announcements, advertisement
or publicity released by either Party concerning this Agreement or activities
arising under it shall be subject to the prior joint approval of the Parties.
5.4 This instrument contains the entire and only Agreement between the
parties and supersedes all preexisting Agreements between the respecting its
subject matter. Any representation, promise, condition, in connection with such
subject matter that is not incorporated in this Agreement shall not be binding
on either party.
ARTICLE 6 - TERM
6.0 This agreement and the licenses granted hereunder shall continue until
the latest date any of the Licensed Patents or the WAP Patent are enforceable
against any party.
WHEREFORE, the Parties have entered into this Agreement as indicated by the
signatures of their authorized representatives set forth below.
TELCORDIA TECHNOLOGIES, INC. GEOWORKS CORPORATION
By:_____________________________ By:__________________________________
Name: Xxxx Xxxx Name:________________________________
Title: Chief Financial Officer Title:_______________________________
EXHIBIT 1.2(D)(III)
GEOWORKS CORPORATION
REGISTRATION RIGHTS AGREEMENT
THIS REGISTRATION RIGHTS AGREEMENT (this "Agreement") is made as of the
24th day of July, 2000, by and among between Geoworks Corporation, a Delaware
corporation (the "Company"), and Telcordia Technologies, Inc., a Delaware
corporation (the "Holder").
RECITALS
A. The Holder has entered into an Asset Purchase and Stock Sale
Agreement, dated as of July 24, 2000, with the Company (the "Asset Purchase
Agreement").
B. In order to induce the Company to enter into the Asset Purchase
Agreement and to induce the Holder to invest in the Company pursuant to the
Asset Purchase Agreement, the Holder and the Company hereby agree that this
Agreement shall govern the rights of the Holder to cause the Company to register
shares of Common Stock of the Company held by and issuable to the Holder and
certain other matters as set forth herein.
NOW, THEREFORE, the parties agree as follows:
AGREEMENT
1. DEFINITIONS. For purposes of this Agreement:
.1 The term "Act" shall mean the Securities Act of 1933,
as amended, and the rules and regulations promulgated thereunder.
.2 The term "Affiliate" shall mean, with respect to any
specified Person, any other Person that, directly or indirectly, through one or
more intermediaries, controls, is controlled by, or in under common control
with, such specified Person.
.3 The term "Asset Purchase Common Stock" shall mean the
Common Stock of the Company sold pursuant to the terms of the Asset Purchase
Agreement.
.4 The term "Common Stock" shall mean the common stock, par
value $.001 per share, of the Company.
.5 The term "1934 Act" shall mean the Securities Exchange Act of
1934, as amended, and the rules and regulations promulgated thereunder.
.6 The terms "register," "registered," and "registration" refer
to a registration effected by preparing and filing a registration statement or
similar document in compliance with the Act, and the declaration or ordering of,
effectiveness of such registration statement or document.
.7 The term "Registrable Securities" shall mean (i) the Asset
Purchase Common Stock (subject to appropriate adjustment for stock splits, stock
dividends, combinations and other recapitalizations after the date hereof
(collectively, a "Recapitalization")), (ii) any Common Stock issued as a
dividend or other distribution with respect to, or in exchange for, or in
replacement of the shares referenced in (i) above, and (iii) any Common Stock
acquired by the Holder after the date hereof, excluding in all cases, however,
any Registrable Securities that have been sold by the Holder privately, pursuant
to the provisions of Rule 144, or pursuant to a registration statement under the
Act covering such Registrable Securities that has been declared effective by the
SEC.
.8 The number of shares of "Registrable Securities then
outstanding" shall be determined by the number of shares of Common Stock
outstanding that are Registrable Securities.
.9 The term "Rule 144" shall mean Rule 144 under the Act as in
effect on the date hereof and such rule as from time to time amended and any
successor rule or regulation under the Act.
.10 The term "Person" shall mean any individual,
corporation, partnership, association, limited liability company, trust,
unincorporated organization, other entity or group (as "group" is defined in
Section 13(d)(3) of the 1934 Act).
.11 The term "SEC" shall mean the Securities and Exchange
Commission and any successor thereto.
.12 The term "Subsidiary" shall mean, when used with reference
to any entity, any corporation or other organization, whether incorporated or
unincorporated, (i) of which such party or any other subsidiary of such party is
a general or managing partner or (ii) the outstanding voting securities or
interests of which, having by their terms ordinary voting power to elect a
majority of the Board of Directors or others performing similar functions with
respect to such corporation or other organization, is directly or indirectly
owned or controlled by such party or by any one or more of its subsidiaries.
2. REGISTRATION.
.1 COMPANY REGISTRATION. The Company shall, on the terms and
conditions hereinafter provided, use its best efforts to cause a registration
statement (the "Registration Statement") covering the resale of the Registrable
Securities to be filed with the SEC under the Act no later than November 21,
2000 and thereafter, proceed as expeditiously as possible to cause such
Registration Statement to be declared effective and qualified under other
applicable securities laws upon request of the Holder. The Company shall use its
best efforts to keep the Registration Statement effective under the Act until
the earlier of (i) three (3) years from the date the Registration Statement has
been declared effective by the SEC, (ii) the date that the Holder or any
permitted assignee pursuant to Section 3.8 of this Agreement no longer owns any
Registrable Securities or (iii) the date when all the Registrable Securities
covered by the Registration Statement are freely transferable pursuant to
subsection (k) of Rule 144.
.2 PIGGYBACK REGISTRATION.
(a) If the Company proposes to register (including for this
purpose a registration effected by the Company for shareholders other than the
Holder) any of its stock or other securities under the Act in connection with
the public offering of such securities (other than a registration relating
solely to the sale of securities to participants in a Company stock plan or a
registration on any form which does not include substantially the same
information as would be required to be included in a registration statement
covering the sale of the Registrable Securities), the Company shall give the
Holder written notice at least twenty (20) days before the initial filing with
the SEC of such registration statement (the "Piggyback Registration Statement"),
which notice shall set forth the amount of securities the Company and other
parties, if any, then contemplate including in such registration and the
intended method of disposition of the securities proposed to be offered by the
Company. The notice shall offer to include in such registration, subject to and
on the terms and conditions hereinafter provided, such number of Registrable
Securities as the Holder may request. The Holder shall advise the Company in
writing within twenty (20) days after receipt of such notice by the Company in
accordance with Section 4.5, setting forth the amount of Registrable Securities
for which registration is requested as part of such Piggyback Registration
Statement. The Company shall, subject to the provisions of Section 3.4, cause to
be registered under the Act all of the Registrable Securities that the Holder
has requested to be registered.
The Company shall not be obligated to effect, or take any action to effect, any
registration pursuant to this Section 2.2 during any such time that the
Registration Statement is effective for the resale of Registrable Securities.
3. REGISTRATION PROCEDURES.
.1 OBLIGATIONS OF THE COMPANY. Whenever required under Sections
2.1 and 2.2 of this Agreement to effect the registration of any Registrable
Securities, the Company shall, as expeditiously as possible:
(a) Prepare and file with the SEC a registration statement
with respect to such Registrable Securities, use its best efforts to cause such
registration statement to become effective and keep such registration statement
effective for a period of up to one hundred eighty (180) days or until the
distribution contemplated in such registration statement has been completed or,
in the case of the Registration Statement filed pursuant to Section 2.1 hereof,
for the period contemplated therein; PROVIDED, HOWEVER, that applicable rules
under the Act governing the obligation to file a post-effective amendment
permit, in lieu of filing a post-effective amendment that (i) includes any
prospectus required by Section 10(a)(3) of the Act, or (ii) reflects facts or
events representing a material or fundamental change in the information set
forth in the registration statement, the incorporation by reference of
information required to be included in (i) and (ii) above to be contained in
periodic reports filed pursuant to Section 13 or 15(d) of the Exchange Act in
the registration statement.
(b) Prepare and file with the SEC such amendments and
supplements to such registration statement and the prospectus used in connection
with such registration statement as may be necessary to comply with the
provisions of the Act with respect to the disposition of all securities covered
by such registration statement.
(c) Furnish to the Holder such numbers of copies of a
prospectus, including a preliminary prospectus, in conformity with the
requirements of the Act, and such other documents as it may reasonably request
from time to time in order to facilitate the disposition of Registrable
Securities owned by the Holder.
(d) Use its best efforts to register and qualify the
securities covered by such registration statement under such other securities or
Blue Sky laws of such jurisdictions as shall be reasonably requested by the
Holder; provided that the Company shall not be required in connection therewith
or as a condition thereto to qualify to do business or to file a general consent
to service of process in any such states or jurisdictions, unless the Company is
already required to qualify to do business or subject to service in such
jurisdiction and except as may be required by the Act.
(e) In the event of any underwritten public offering,
enter into and perform its obligations under an underwriting agreement, in usual
and customary form, with the managing underwriter of such offering.
(f) Notify the Holder at any time when a prospectus
relating thereto is required to be delivered under the Act of the happening of
any event as a result of which the prospectus included in such registration
statement, as then in effect, includes an untrue statement of a material fact or
omits to state a material fact required to be stated therein or necessary to
make the statements therein not misleading in the light of the circumstances
then existing.
(g) Cause all such Registrable Securities registered
pursuant hereunder to be listed on each securities exchange on which similar
securities issued by the Company are then listed.
(h) Provide a transfer agent and registrar for all
Registrable Securities registered pursuant hereunder and a CUSIP number for all
such Registrable Securities, in each case not later than the effective date of
such registration.
(i) Make available for inspection by the Holder
participating in such registration, any underwriter participating in any
disposition pursuant to such registration, and any attorney or accountant
retained by the Holder or underwriter, all financial and other records,
pertinent corporate documents and properties of the Company, and cause the
Company's officers and directors to supply all information reasonably requested
by the Holder, underwriter, attorney or accountant in connection with such
registration statement; PROVIDED, HOWEVER, that the Holder, underwriter,
attorney or accountant shall agree to hold in confidence and trust all
information so provided.
(j) Make available to the Holder participating in such
registration, upon the request of the Holder:
(i) in the case of an underwritten public
offering, a copy of any opinion of counsel for the Company provided to the
underwriters participating in such offering, dated the date such shares are
delivered to such underwriters for sale in connection with the registration
statement;
(ii) in the case of an underwritten public
offering, a copy of any "comfort" letters provided to the underwriters
participating in such offering and signed by the Company's independent public
accountants who have examined and reported on the Company's financial statements
included in the registration statement, to the extent permitted by the standards
of the AICPA or other relevant authorities; and
(iii) a copy of all documents filed with
and all correspondence from or to the SEC in connection with any such offering
other than non-substantive cover letters and the like.
.2 FURNISH INFORMATION. It shall be a condition precedent to the
obligations of the Company to take any action pursuant to Section 2 of this
Agreement with respect to Registrable Securities of the Holder that the Holder
shall furnish to the Company such information regarding itself, the Registrable
Securities held by it, and the intended method of disposition of such securities
as shall be required to effect the registration of the Holder's Registrable
Securities.
.3 EXPENSES OF COMPANY REGISTRATION. The Company shall bear and pay
all expenses incurred in connection with any registration, filing or
qualification of Registrable Securities with respect to the registrations
pursuant to Sections 2.1 and 2.2 of this Agreement for the Holder, including
(without limitation) all registration, filing, and qualification fees, printers
and accounting fees relating or apportionable thereto and the fees and
disbursements of counsel for the Company in its capacity as counsel to the
selling Holder hereunder; if Company counsel does not make itself available for
this purpose, the Company will pay the reasonable fees and disbursements of one
counsel for the selling Holder selected by them, but excluding underwriting
discounts and commissions relating to Registrable Securities.
.4 UNDERWRITING REQUIREMENTS.
(a) In connection with any offering involving an underwriting of
shares of the Company's capital stock, the Company shall not be required under
Section 2.2 of this Agreement to include any of the Holder's securities in such
underwriting unless they accept the terms of the underwriting as agreed upon
between the Company and the underwriters selected by it and then only in such
quantity as the underwriters determine in their sole discretion will not
jeopardize the success of the offering by the Company.
(b) If the total amount of securities requested by shareholders to be
included in such offering, including Registrable Securities under Section 2.2 of
this Agreement, exceeds the amount of securities sold other than by the Company
that the underwriters determine in their sole discretion is compatible with the
success of the offering, then the managing underwriter shall advise the Company
in writing (with a copy to the Holder) that, in its opinion, the number of
securities requested to be included in such registration (including securities
to be sold by the Company or by other Persons not holding Registrable
Securities) will jeopardize the success of the offering. In such case, the
securities so included to be apportioned pro rata among the selling shareholders
according to the total amount of securities entitled to be included therein
owned by each selling shareholder or in such other proportions as shall mutually
be agreed to by such selling shareholders. For purposes of the preceding
sentence concerning apportionment, for any selling shareholder which is a holder
of Registrable Securities and which is a partnership or corporation, the
partners, retired partners and shareholders of such holder, or the estates and
family members of any such partners and retired partners and any trusts for the
benefit of any of the foregoing Persons shall be deemed to be a single "selling
shareholder," and any pro-rata reduction with respect to such "selling
shareholder" shall be based upon the aggregate amount of shares carrying
registration rights owned by all entities and individuals included in such
"selling shareholder," as defined in this sentence.
.5 DELAY OF REGISTRATION. The Holder shall not have any right to
obtain or seek an injunction restraining or otherwise delaying any such
registration as the result of any controversy that might arise with respect to
the interpretation or implementation of this Article 3.
.6 INDEMNIFICATION. In the event any Registrable Securities are
included in a registration statement under this Agreement:
(a) To the extent permitted by law, the Company will indemnify
and hold harmless the Holder, each officer and director of the Holder, any
underwriter (as defined in the Act) of the Holder and each Person, if any, who
controls the Holder or underwriter within the meaning of the Act or the 1934
Act, against any losses, claims, damages, or liabilities (joint or several) to
which they may become subject under the Act, the 1934 Act or other federal or
state law, insofar as such losses, claims, damages, or liabilities (or actions
in respect thereof) arise out of or are based upon any of the following
statements, omissions or violations (collectively, a "Violation"): (i) any
untrue statement or alleged untrue statement of a material fact contained in
such registration statement, including any preliminary prospectus or final
prospectus contained therein or any amendments or supplements thereto; (ii) the
omission or alleged omission to state therein a material fact required to be
stated therein, or necessary to make the statements therein, in light of the
circumstances under which they were made, not misleading; or (iii) any violation
or alleged violation by the Company of the Act, the 1934 Act, any state
securities law or any rule or regulation promulgated under the Act, the 1934 Act
or any state securities law; and the Company will pay to the Holder, underwriter
or controlling Person any legal or other expenses reasonably incurred by them in
connection with investigating or defending any such loss, claim, damage,
liability, or action; PROVIDED, HOWEVER, that the indemnity provisions contained
in this Section 3.6(a) shall not apply to (1) amounts paid in settlement of any
such loss, claim, damage, liability, or action if such settlement is effected
without the consent of the Company (which consent shall not be unreasonably
withheld), or (2) any such loss, claim, damage, liability, or action to the
extent that it arises out of or is based upon a Violation which occurs in
reliance upon and
in conformity with written information furnished expressly for use in connection
with such registration by the Holder (including each officer and director of the
Holder), underwriter or controlling Person.
(b) To the extent permitted by law, the Holder will indemnify
and hold harmless the Company, each of its directors, each of its officers who
has signed the registration statement, each Person, if any, who controls the
Company within the meaning of the Act, any underwriter, any other Person selling
securities in such registration statement, each officer and director of any such
other Person and any controlling Person of any such underwriter or other Person,
against any losses, claims, damages, or liabilities (joint or several) to which
any of the foregoing Persons may become subject, under the Act, the 1934 Act or
other federal or state law, insofar as such losses, claims, damages, or
liabilities (or actions in respect thereto) arise out of or are based upon any
Violation, in each case to the extent (and only to the extent) that such
Violation occurs in reliance upon and in conformity with written information
furnished by the Holder, or by an officer or director of the Holder expressly
for use in connection with such registration; and the Holder will pay any legal
or other expenses reasonably incurred by any Person intended to be indemnified
pursuant to this Section 3.6(b) in connection with investigating or defending
any such loss, claim, damage, liability, or action; PROVIDED, HOWEVER, that the
indemnity agreement contained in this Section 3.6(b) shall not apply to amounts
paid in settlement of any such loss, claim, damage, liability or action if such
settlement is effected without the consent of the Holder, which consent shall
not be unreasonably withheld; PROVIDED, FURTHER, that in no event shall any
indemnity under this Section 3.6(b) exceed the gross proceeds from the offering
received by the Holder net of underwriters' commissions and discounts.
(c) Promptly after obtaining actual knowledge of any third party
claim or action as to which it may seek indemnification under this Section 3.6,
an indemnified party will, if a claim in respect thereof is to be made against
any indemnifying party under this Section 3.6, deliver to the indemnifying party
a written notice thereof and the indemnifying party shall have the right to
participate in, and, to the extent the indemnifying party so desires, jointly
with any other indemnifying party similarly noticed, to assume the defense
thereof with counsel mutually satisfactory to the parties; PROVIDED, HOWEVER,
that an indemnified party (together with all other indemnified parties which may
be represented without conflict by one counsel) shall have the right to retain
one separate counsel, with the fees and expenses to be paid by the indemnifying
party, if representation of such indemnified party by the counsel retained by
the indemnifying party would be inappropriate due to actual or potential
differing interests between such indemnified party and any other party
represented by such counsel in such proceeding. The failure to deliver written
notice to the indemnifying party within a reasonable time of the commencement of
any such action shall relieve such indemnifying party of any liability to the
indemnified party under this Section 3.6, if, and to the extent that, such
failure is prejudicial to such indemnifying party's ability to defend such
action, but the omission so to deliver written notice to the indemnifying party
will not relieve it of any liability that it may have to any indemnified party
otherwise than under this Section 3.6.
(d) If the indemnification provided for in this Section 3.6 is
held by a court of competent jurisdiction to be unavailable to an indemnified
party with respect to any loss, liability, claim, damage, or expense referred to
therein, then the indemnifying party, in lieu of indemnifying such indemnified
party hereunder, shall contribute to the amount paid or payable
by such indemnified party as a result of such loss, liability, claim, damage, or
expense (including, without limitation, legal and other expenses incurred by
such indemnified party in investigating or defending any such action or claim)
in such proportion as is appropriate to reflect the relative fault of the
indemnifying party on the one hand and of the indemnified party on the other in
connection with the statements or omissions that resulted in such loss,
liability, claim, damage, or expense as well as any other relevant equitable
considerations. The relative fault of the indemnifying party and of the
indemnified party shall be determined by reference to, among other things,
whether the untrue or alleged untrue statement of a material fact or the
omission to state a material fact relates to information supplied by the
indemnifying party or by the indemnified party and the parties' relative intent,
knowledge, access to information, and opportunity to correct or prevent such
statement or omission. Notwithstanding the provisions of this Section 3.6(d),
the Holder shall not be required to contribute any amount or make any other
payments under this Agreement which in the aggregate exceed the net proceeds
received by the Holder from the offering covered by the applicable registration
statement.
(e) Notwithstanding the foregoing, to the extent that the
provisions on indemnification and contribution contained in the underwriting
agreement entered into in connection with the underwritten public offering are
in conflict with the foregoing provisions, the provisions in the underwriting
agreement shall control.
(f) The obligations of the Company and the Holder under this
Section 3.6 shall survive the completion of any offering of Registrable
Securities in a registration statement under this Agreement, and otherwise.
.7 REPORTS UNDER SECURITIES EXCHANGE ACT OF 1934. With a view to
making available to the Holder the benefits of Rule 144 and any other rule or
regulation of the SEC that may at any time permit the Holder to sell securities
of the Company to the public without registration, the Company agrees to:
(a) make and keep public information available, as those terms
are understood and defined in Rule 144;
(b) file with the SEC in a timely manner all reports and other
documents required of the Company under the Act and the 1934 Act; and
(c) furnish to the Holder, so long as the Holder owns any
Registrable Securities, forthwith upon request (i) a written statement by the
Company that it has complied with the reporting requirements of Rule 144, the
Act and the 1934 Act, (ii) a copy of the most recent annual or quarterly report
of the Company and such other reports and documents so filed by the Company, and
(iii) such other information as may be reasonably requested in availing the
Holder of any rule or regulation of the SEC which permits the selling of any
such securities without registration or pursuant to such form.
.8 NO ASSIGNMENT OF REGISTRATION RIGHTS. The rights to cause the
Company to register Registrable Securities pursuant to this Agreement may not be
assigned; PROVIDED, HOWEVER, that the Holder may assign its rights and
obligations under this Agreement to any Subsidiary or Affiliate of the Holder
which has become the owner of Registrable Securities.
.9 "MARKET STAND-OFF" AGREEMENT. The Holder hereby agrees that,
during the period of duration specified by the Company and an underwriter of
Common Stock or other securities of the Company of the same class as the
Registrable Securities, following the date on which a registration statement of
the Company is filed under the Act, it shall not, to the extent requested by the
Company and such underwriter, directly or indirectly sell, offer to sell,
contract to sell (including, without limitation, any short sale), grant any
option to purchase or otherwise transfer or dispose of (other than to donees who
agree to be similarly bound) any securities of the Company held by it at any
time during such period, except (i) Common Stock included in such registration
(other than Registrable Securities included therein in connection with the
exercise of the Holder's rights pursuant to Section 2.2 of this Agreement, in
respect of which a registration thereof may be permitted, subject to the
Company's receipt of Holder's written consent not to dispose of such Registrable
Securities in any manner for the relevant time period set forth in this Section
3.9) and (ii) any Registrable Securities disposed of by private sale, so long as
each such purchaser (and any and all subsequent purchasers) shall agree in
writing, not later than the effective time of such private sale, to be bound by
all of the terms and conditions of this Section 3.9; PROVIDED, HOWEVER, that:
(a) such agreement shall be applicable during the five (5) years
following the date of this Agreement, subject to an earlier termination of such
limitation period following the market stand-off period of the second such
registration statement of the Company which covers Common Stock (or other
securities of the Company of the same class as the Registrable Securities) to be
sold on its behalf to the public in an underwritten offering;
(b) such market stand-off time period shall not exceed 90 days
following the effective date of each such registration statement;
(c) such agreement shall not be applicable more than once in any
12-month time period; and
(d) all executive officers and directors of the Company enter
into similar agreements.
In order to enforce the foregoing covenant, the Company may impose
stop-transfer instructions with respect to the Registrable Securities of the
Holder (and the shares or securities of every other Person subject to the
foregoing restriction) until the end of such period.
Notwithstanding the foregoing, the obligations described in this
Section 3.9 shall not apply to a registration relating solely to employee
benefit plans on Form S-1 or Form S-8 or similar forms which may be promulgated
in the future, or a registration relating solely to a Commission Rule 145
transaction on Form S-4 or similar forms which may be promulgated in the future.
4. MISCELLANEOUS.
.1 SUCCESSORS AND ASSIGNS. Except as otherwise provided herein,
the terms and conditions of this Agreement shall inure to the benefit of and be
binding upon the respective successors and assigns of the parties (including
transferees of any shares of Registrable Securities). Nothing in this Agreement,
express or implied, is intended to confer upon any party other than the parties
hereto or their respective successors and assigns any rights, remedies,
obliga-
tions, or liabilities under or by reason of this Agreement, except as
expressly provided in this Agreement.
.2 GOVERNING LAW. This Agreement shall be governed by and
construed under the laws of the State of Delaware.
.3 COUNTERPARTS. This Agreement may be executed in two or more
counterparts, each of which shall be deemed an original, but all of which
together shall constitute one and the same instrument.
.4 TITLES AND SUBTITLES. The titles and subtitles used in this
Agreement are used for convenience only and are not to be considered in
construing or interpreting this Agreement.
.5 NOTICES. All notices, requests, demands, waivers and other
communications required or permitted to be given under this Agreement shall be
in writing and shall be deemed to have been duly given if delivered in Person or
mailed, certified or registered mail with postage prepaid, or sent by courier
service, telex, telegram, or fax, as follows:
(a) if to the Seller:
Telcordia Technologies, Inc.
000 Xxxxx Xxxxxx
Xxxxxxxxxx, Xxx Xxxxxx 00000
Attention: Xxxx X. Xxxxx, Xx., Esq.
Telephone: (000) 000-0000
Fax: (000) 000-0000
With a copy to:
(which shall not constitute notice)
Weil, Gotshal & Xxxxxx LLP
000 Xxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: Xxxxxx Xxxxxxxxxx, Esq.
Telephone: (000) 000-0000
Fax: (000) 000-0000
(b) if to Purchaser:
Geoworks Corporation.
000 Xxxxxxxx Xxxxxx
Xxxxxxx, Xxxxxxxxxx 00000
Attention: Xxxxx Xxxxx, Esq.
Telephone: (000) 000-0000
Fax: (000) 000-0000
with a copy to:
(which shall not constitute notice)
Xxxxx Xxxx LLP
0000 Xxxx Xxxxxx, Xxxxx 000
Xxxxxx, Xxxxxxxxxx 00000
Attention: Xxxxxxx X. Xxxx, Esq.
Telephone: (000) 000-0000
Fax: (000) 000-0000
or to such other Person or address as any party shall specify by notice in
writing to each of the other parties. All such notices, requests, demands,
waivers and communications shall be deemed to have been received on the date of
delivery if the date of transmission is electronically endorsed automatically on
the media or evidenced by courier service documentation. If notice is mailed or
transmitted in a manner in which date of delivery cannot be ascertained from the
media used or courier service records, notice shall be deemed given on the third
business day after the mailing or other transmission or delivery thereof. A
notice of a change of address shall be effective only upon receipt.
.6 EXPENSES. If any action at law or in equity is necessary to
enforce or interpret the terms of this Agreement, the prevailing party shall be
entitled to reasonable attorneys' fees, costs and necessary disbursements in
addition to any other relief to which such party may be entitled.
.7 AMENDMENTS AND WAIVERS. Any term of this Agreement may be amended
and the observance of any term of this Agreement may be waived (either generally
or in a particular instance and either retroactively or prospectively), only
with the written consent of the Company and the holders of the Registrable
Securities then outstanding. Any amendment or waiver effected in accordance with
this Section 4.7 shall be binding upon each holder of any Registrable Securities
then outstanding, each future holder of all such Registrable Securities, and the
Company; provided that, without the consent of the Company and all holders of
Registrable Securities then outstanding, no amendment to this Agreement may be
made that (i) modifies this Section 4.7, or (ii) would effect the holders of the
Registrable Securities in a disproportionate manner (other than any
disproportionate results that are due to a difference in the relative stock
ownership in the Company).
.8 SEVERABILITY. If one or more provisions of this Agreement are
held to be unenforceable under applicable law, such provision shall be excluded
from this Agreement and the balance of the Agreement shall be interpreted as if
such provision were so excluded and shall be enforceable in accordance with its
terms.
.9 AGGREGATION OF STOCK. All shares of Registrable Securities held
or acquired by affiliated entities or Persons shall be aggregated together for
the purpose of determining the availability of any rights under this Agreement.
.10 ENTIRE AGREEMENT. This Agreement constitutes the full and entire
understanding and agreement between the parties regarding the matters set forth
herein. Except as otherwise expressly provided herein, the provisions hereof
shall inure to the benefit of, and be binding upon the successors, assigns,
heirs, executors and administrators of the parties hereto.
.11 FURTHER ASSURANCES. At any time, and from time to time, each
party will execute such additional instruments and take such action as may be
reasonably requested by any other party to carry out the intent and purposes of
this Agreement.
.12 Jury Trial Waiver. THE PARTIES AGREE TO WAIVE THEIR SEPARATE
RIGHTS TO A TRIAL BY JURY. THIS WAIVER MEANS THAT ANY TRIAL WILL BE BEFORE A
JUDGE.
IN WITNESS WHEREOF, the parties have executed this
Registration Rights Agreement as of the date first above written.
GEOWORKS CORPORATION
By:
----------------------------------------
Name:
Title:
TELCORDIA TECHNOLOGIES, INC.
By:
----------------------------------------
Name:
Title:
EXHIBIT 1.2(D)(IV)
TRANSITION SERVICES AGREEMENT
THIS TRANSITION SERVICES AGREEMENT (the "Transition Services Agreement")
is made and entered into as of July 24, 2000, by and between TELCORDIA
TECHNOLOGIES, INC., a Delaware corporation ("Telcordia"), and AIRBOSS
ACQUISITION CORPORATION, a New Jersey corporation ("AirBoss Acquisition").
W I T N E S S E T H
WHEREAS, contemporaneously with the execution of this Agreement,
Geoworks Corporation ("Geoworks"), AirBoss Acquisition, and Telcordia are
entering into an Asset Purchase and Stock Sale Agreement (the "Asset Purchase
Agreement"), pursuant to which AirBoss Acquisition is purchasing certain assets
used or employed by Telcordia in connection with the operations of the AirBoss
Division (the "Division");
WHEREAS, following consummation of the transactions contemplated by the
Asset Purchase Agreement, AirBoss Acquisition will continue to carry on the
operations of the Division and transition the operations of the Division's
Telcordia facilities to AirBoss Acquisition's facilities; and
WHEREAS, subject to the terms and conditions set forth in this
Transition Services Agreement, AirBoss Acquisition desires for Telcordia to
provide certain transition services to it, including, without limitation, the
license of space at Telcordia's facilities located at 000 Xxxxx Xxxxxx,
Xxxxxxxxxx, XX 00000, 000 Xxxx Xxxx, Xxxxxxxxxx, XX 00000-0000, and 000 Xxxxxx
Xxxxxxx Xxxx, Xxx Xxxx, XX 00000 (the "Telcordia Facilities"), and Telcordia is
willing to perform such services;
NOW, THEREFORE, for and in consideration of the premises, the mutual
promises, covenants and agreements contained herein, and other good and valuable
consideration, the receipt and sufficiency of which are hereby acknowledged, the
parties hereto hereby agree as follows:
1. SCOPE OF SERVICES.
Subject to the terms and conditions set forth herein, AirBoss
Acquisition hereby engages Telcordia to provide those transition and other
services described on EXHIBIT A attached hereto (the "Services", including the
Usage Sensitive Services, as defined in EXHIBIT A), and Telcordia hereby accepts
such engagement. Telcordia shall provide, or cause to be provided, the necessary
personnel and facilities required to perform the Services; provided, however,
that to the extent any Service requires the consent of third parties or the
acquisition or development of any rights, expertise, property, equipment, or
services not currently possessed by or provided to Telcordia, Telcordia reserves
the right not to provide such Service.
2. LICENSE OF SPACE.
2.1 LICENSE.
(a) Subject to the terms and conditions set forth in this
Agreement, Telcordia hereby grants to AirBoss Acquisition a license
(the "License of Space") to occupy that certain space at the Telcordia
Facilities more fully described on EXHIBIT B attached hereto (the
"Licensed Space") from the date hereof until the date specified in
Section 7.1 (the "License Term") for the sole purpose of conducting the
operations of the Division. AirBoss Acquisition understands and agrees
that AirBoss Acquisition's use of the Licensed Space is subject to such
policies and requirements governing the Telcordia Facilities and
related facilities as may be established from time to time by
Telcordia. AirBoss Acquisition and Telcordia agree to cooperate with
each other, and all building occupants to enhance compliance with such
policies and requirements and to avoid conflicts between building
occupants. The provisions of this license shall not be deemed to create
in AirBoss Acquisition any estate or term for years in the Licensed
Space, it being acknowledged and agreed that AirBoss Acquisition shall
have only a license to use the Licensed Space as provided herein.
AirBoss Acquisition agrees that it shall not do or cause to be done any
act that would adversely interfere with Telcordia's use of the space
adjacent to the Licensed Space.
(b) AirBoss Acquisition acknowledges and agrees that the
Licensed Space is being made available to on an "As Is" basis "With All
Faults", and that neither Telcordia nor any affiliate, officer,
director, employee, agent or representative of Telcordia has made any
representation or warranty to AirBoss Acquisition with respect to or
concerning the Licensed Space or its suitability for the conduct of the
operations of the Division.
(c) AirBoss Acquisition shall at its sole cost and expense
(i) obtain any licenses or permits required by any governmental or
quasi-governmental agency or authority with respect to the type of
activity to be conducted in the Licensed Space, and (ii) comply with
all applicable federal, state and local laws, rules, regulations and
ordinances during its occupancy of the Licensed Space.
2.2 USE OF LICENSED SPACE. AirBoss Acquisition shall use the
Licensed Space in substantially the same manner as Telcordia currently uses the
Licensed Space in connection with the operations of the Division. Without
limiting the generality of the foregoing, AirBoss Acquisition shall not
generate, store, use, treat or dispose of, nor allow, suffer or permit the
generation, storage, use, treatment or disposal of, any "hazardous waste" or
"hazardous substance" (as those terms are defined in the Resource Conservation
and Recovery Act, 42 U.S.C. Sections 69-01 et seq., as amended ("RCRA"), or the
Comprehensive Environmental Response, Compensation and Liability Act, 42 U.S.C.
Sections 9601 et seq., as amended ("CERCLA"), or any rules and regulations now
or hereafter promulgated under either of such acts), or any pollutant or other
contaminant on, in, from or about the Licensed Space, which hazardous material
is prohibited or controlled by any federal, state or local law, rule, regulation
or ordinance now or hereafter in effect; provided, however, that AirBoss
Acquisition shall not be deemed in breach of the foregoing provision merely by
virtue of the continuance of conditions already existing as of the date hereof.
2.3 INSURANCE.
(a) Prior to any entry onto the Licensed Space hereunder,
AirBoss Acquisition shall obtain at its sole cost and expense, and
shall maintain during the period of any and all entries onto the
Licensed Space, at least the following insurance, covering activities
performed by AirBoss Acquisition and its agents, employees, licensees,
invitees and representatives and any independent contractors employed
by or paid by or on behalf ofAirBoss Acquisition:
(i) Commercial general liability and property
damage insurance covering the legal liability of AirBoss
Acquisition and its affiliates, officers, directors,
employees, agents, licensees, invitees and representatives and
any independent contractors employed by or paid by or on
behalf of AirBoss Acquisition or its affiliates against all
claims for any bodily injury or death of persons and for
damage to or destruction of property, in combined single
limits for both property damage and personal injury in the
minimum amount of $2,000,000.00 per occurrence;
(ii) Workers' compensation insurance, in an
amount not less than the minimum amount required by law, and
employer's liability insurance, in an amount not less than
$100,000.
(b) All such insurance shall be written by companies of
recognized financial standing which are authorized to do insurance
business in the State of New Jersey, shall, except for the policies
referred to in Section 2.3 (a)(ii), name Telcordia and its affiliates
as additional insured parties as to liability insurance, shall be
reasonably satisfactory to Telcordia in all respects and shall
expressly provide that no cancellation, reduction in amount or material
change in coverage thereof shall be effective until at least thirty
(30) days after receipt by Telcordia of written notice thereof. A copy
of each policy or of an acceptable certificate of insurance in full
force and effect, issued by the insurer, shall be delivered to
Telcordia on or before the date of any entry onto the Licensed Space by
or on behalf of AirBoss Acquisition.
2.4 REMOVAL OF PROPERTY AND EQUIPMENT. AirBoss Acquisition agrees
that upon the expiration or termination of the License Term, AirBoss Acquisition
shall remove its personal property from the Licensed Space, repair any and all
damage caused by such removal (other than such damage caused by the removal of
any Acquired Asset as defined in the Agreement) and peaceably yield up the
Licensed Space in the same condition that it was received, ordinary wear and
tear excepted. Any personal property of AirBoss Acquisition not removed within
sixty (60) days following expiration or termination of the License Term shall,
at Telcordia's option, become the property of Telcordia.
2.5 INDEMNIFICATION AND RELEASE.
(a) AirBoss Acquisition hereby assumes liability for and
shall indemnify and hold harmless Telcordia, its affiliates and their
respective officers, directors, employees, agents, representatives and
invitees (collectively, the "Indemnitees") from and against any and all
liability, loss, cost, damage or expense (including, without
limitation, costs of litigation and reasonable attorneys' fees) that
any of the Indemnitees shall ever suffer or
incur in connection with loss of life, bodily and/or personal injury,
or damage to property arising out of or from the use or occupancy by
AirBoss Acquisition of the Licensed Space, or any part thereof, or any
other part of the premises of Telcordia, or occasioned wholly or in
part by any act or omission ofAirBoss Acquisition, its affiliates or
their respective employees, agents, guests, invitees or contractors, or
in any way relating to or arising out of any activity of AirBoss
Acquisition, except that such indemnity shall not extend to indemnify
an Indemnitee from and against damages arising out of bodily injury to
persons or damage to property to the extent caused by or resulting from
the negligence of such Indemnitee, its agents or employees.
(b) AirBoss Acquisition hereby releases Indemnitees from any
liability in regard to any loss, theft, burglary, robbery or damage to
equipment, supplies, or other property of AirBoss Acquisition or any of
its affiliates, employees, agents, guests, invitees or contractors. To
the fullest extent permitted by law, AirBoss Acquisition further hereby
releases the Indemnitees from any liability for damage to property of
AirBoss Acquisition or any other person claiming through AirBoss
Acquisition resulting from any accident or occurrence in or upon the
Licensed Space or the land adjacent to the Licensed Space.
3. COMPENSATION.
3.1 PRICES. AirBoss Acquisition shall pay to Telcordia (i) a daily rate
of $642.99 for the Services provided, other than the Usage Sensitive Services,
as described in EXHIBIT A, hereto; (ii) a daily rate of $630.76 for the license
of the Licensed Space; (iii) an hourly rate based upon actual hours of work of
the Contracted Work Force, as described in EXHIBIT A; and (iv) a rate determined
by the actual usage of the Usage Sensitive Services, as described in EXHIBIT A.
Where a daily rate applies, it shall be assessed for each day or part thereof
from the date hereof until the termination of this Transition Services Agreement
within the provisions of Sections 7.1 and 7.2, below. Where an hourly or usage
sensitive rate applies, such rate will be assessed based upon the actual hours
of service performed by the Contracted Work Force, or the actual usage of Usage
Sensitive Services, as the case may be. Telcordia shall not change the prices
set forth on EXHIBIT A during the Initial Term, as defined in Section 7.1,
below.
3.2 INVOICES AND PAYMENT. During the term of this Agreement, Telcordia
shall invoice AirBoss Acquisition monthly for Services provided during the
previous month (which invoice will contain an itemized description of the
services provided) and for the license of the Licensed Space, and AirBoss
Acquisition shall pay each such invoice within 45 (forty-five) days following
its receipt of such invoice.
3.3 PRICE FOR SPACE UPON RENEWAL. In the event AirBoss Acquisition
requests to renew this Transition Services Agreement upon the expiration of the
Initial Term, AirBoss Acquisition may elect up to two (2) 30-day renewal terms.
The rental of the Licensed Space for the first 30-day renewal term or part
thereof shall be 125% (one hundred twenty-five per cent)of the daily rental for
the Licensed Space applicable to the initial term as provided in Section 3.1,
and the rental of the Licensed Space for the second renewal term shall be 150%
(one hundred fifty per cent) of the monthly rental for the Licensed Space
applicable to the initial term as provided in Section 3.1.
4. PERFORMANCE OF SERVICES. Notwithstanding anything to the contrary
contained in this
Agreement, AirBoss Acquisition understands and agrees that Telcordia has made
arrangements whereby employees of Telcordia will perform various activities on
behalf of Telcordia pursuant to this Transition Services Agreement (the
"Contracted Work Force", described in Exhibit A hereto), and AirBoss Acquisition
hereby consents and agrees to such practice. In addition, Telcordia has made
arrangements whereby facilities of the affiliates of Telcordia will be utilized
for the performance of services under this Transition Services Agreement, and
AirBoss Acquisition hereby consents and agrees to such practice. Telcordia will
be responsible for the activities of such employees and the provision of the
facilities for purposes of this Transition Services Agreement and AirBoss
Acquisition hereby waives and relinquishes all claims or causes of action solely
under this Transition Services Agreement against Telcordia's parent and
affiliates associated in any way with the Services or license of the Licensed
Space, it being agreed that the activities of such employees and use of such
facilities will not be attributable to such parent or affiliates.
5. DISCLAIMER OF WARRANTIES. TELCORDIA MAKES NO REPRESENTATIONS OR
WARRANTIES OF ANY KIND, NATURE, OR DESCRIPTION, EXPRESS OR IMPLIED, WITH RESPECT
TO THE SERVICES, THE LICENSED SPACE, OR ANY OF ITS ACTIVITIES HEREUNDER,
INCLUDING, WITHOUT LIMITATION, ANY IMPLIED WARRANTY OF MERCHANTABILITY OR
FITNESS FOR A PARTICULAR PURPOSE, AND HEREBY DISCLAIMS SAME.
6. LIMITATION OF LIABILITY.
6.1 LIMITATION OF DAMAGES. NEITHER PARTY WILL BE LIABLE TO THE
OTHER PARTY, WHETHER IN CONTRACT OR IN TORT OR UNDER ANY OTHER LEGAL THEORY,
INCLUDING NEGLIGENCE, FOR ANY INDIRECT, SPECIAL, INCIDENTAL, CONSEQUENTIAL,
PUNITIVE, OR SIMILAR DAMAGES ARISING OUT OF OR IN CONNECTION WITH THE
PERFORMANCE OR NON-PERFORMANCE OF THIS AGREEMENT, OR FOR ANY CLAIM MADE AGAINST
ONE PARTY BY ANY THIRD PARTY, EVEN IF SUCH PARTY HAS BEEN ADVISED OF THE
POSSIBILITY OF SUCH CLAIM; PROVIDED, HOWEVER, THAT THE FOREGOING SHALL NOT APPLY
TO LIMITAIRBOSS ACQUISITION'S LIABILITY TO TELCORDIA IN CONNECTION WITH DAMAGE
TO PROPERTY OR INJURY TO PERSONS, INCLUDING DEATH, OR TO CLAIMS OF THIRD PARTIES
ARISING OUT OF OR IN CONNECTION WITH AIRBOSS ACQUISITION'S USE OF THE SERVICES
OR THE LICENSED SPACE.
6.2 LIMITATION OF AMOUNT OF DAMAGES. TELCORDIA'S LIABILITY FOR ANY
CLAIM ARISING UNDER OR IN CONNECTION WITH THIS AGREEMENT WILL NOT EXCEED THE
AMOUNT OF PAYMENT RECEIVED BY TELCORDIA FROM AIRBOSS ACQUISITION FOR THE
PARTICULAR SERVICES GIVING RISE TO SUCH LIABILITY.
6.3 SURVIVAL. The provisions of Sections 2.4, 2.5, 6 and 7.3 will
survive any termination or expiration of this Agreement.
7. TERM AND TERMINATION
7.1 TERM OF AGREEMENT. The term of this Transition Services Agreement
shall commence as of the date hereof and (i) with respect to License of Space,
continue for a period not to exceed 120 (one hundred twenty) days (the "Initial
Term"), and, (ii) with respect to Services, until terminated by the parties by
mutual agreement, or until terminated for cause by one of the parties under
Section 7.2). However, notwithstanding this provision, AirBoss Acquisition shall
have the right to terminate this agreement after 90 (ninety) days from the date
hereof, upon ten (10) days' notice given in accordance with the notice
provisions of Section 9.2, below.
7.2 TERMINATION FOR CAUSE. Notwithstanding anything to the contrary set
forth in this Agreement, either party may, by written notice to the other,
terminate this Transition Services Agreement or suspend its further performance
without terminating this Transition Services Agreement if the other party
breaches any of its material obligations under this Transition Services
Agreement and fails to cure such breach within thirty (30) days following
receipt of written notice of such breach from the non-breaching party (or, if
the breach is such that its cure is possible but will take longer than thirty
(30) days, fails to commence to cure such breach and proceed diligently
therewith until cured).
7.3 OBLIGATIONS UPON TERMINATION. Upon expiration or termination of
this Transition Services Agreement for any reason, AirBoss Acquisition shall
promptly pay to Telcordia all amounts owing to Telcordia for Services performed
or the license of the Licensed Space prior to such expiration or termination.
8. DISPUTE RESOLUTION. All disputes arising between the parties hereto
with respect to their obligations hereunder shall be resolved in accordance with
the procedures set forth in Section 7.10 of the Asset Purchase Agreement, which
Section 7.10 is incorporated herein by this reference.
9. MISCELLANEOUS
9.1 EXCUSABLE DELAYS. In no event will either party be deemed to be in
default of any provision of this Agreement or liable for delays or interruptions
in performance of Services or license of the Licensed Space resulting from acts
or events beyond the reasonable control of that party. Such acts or events
include, without limitation, acts of God, civil or military authority, civil
disturbance, war, strikes, fires, other catastrophes, computer system failures,
utility service failures, acts of third parties, or other events beyond that
party's reasonable control.
9.2 NOTICES.
(a) All notices, consents, requests and other communications hereunder
shall be in writing and shall be sent by hand delivery, by certified or
registered mail (return-receipt requested), by facsimile, or by a recognized
national overnight courier service as set forth below:
If to AirBoss Acquisition: AirBoss Acquisition Corporation
c/o Geoworks Corporation
000 Xxxxxxxx Xxxxxx
Xxxxxxx, Xxxxxxxxxx 00000
Attention: Xxxxx Xxxxx, Esq.
Telephone No. (000) 000-0000
Facsimile No. (000) 000-0000
With a copy to: Xxxxx Xxxx LLP
0000 Xxxx Xxxxxx, Xxxxx 000
Xxxxxx, Xxxxxxxxxx 00000
Attention: Xxxxxxx X. Xxxx, Esq.
Telephone No. (000) 000-0000
Facsimile No. (000) 000-0000
If to Telcordia: Telcordia Technologies, Inc.
000 Xxxxx Xxxxxx
Xxxxxxxxxx, Xxx Xxxxxx 00000
Attention: Xxxx X. Xxxxx, Xx., Esq.
Telephone No. (000) 000-0000
Facsimile No. (000) 000-0000
With a copy to: Xxxx Xxxxxxx & Xxxxxx
000 Xxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: Xxxxxx Xxxxxxxxxx, Esq.
Telephone No. (000) 000-0000
Facsimile No. (000) 000-0000
(b) Notices delivered pursuant to this Section 9.2 shall be
deemed given: (i) at the time delivered, if personally delivered; (ii)
at the time received, if mailed or delivered by facsimile; and (iii)
one (1) business day after timely delivery to the courier, if by a
nationally recognized overnight courier service.
(c) Any party hereto may change the address to which notice
is to be sent by written notice to the other parties in accordance with
this Section 9.2.
9.3 ENTIRE AGREEMENT. This Transition Services Agreement, including
all exhibits hereto (all of which are incorporated herein by this reference),
contains the entire agreement and understanding concerning the subject matter
hereof between the parties hereto and supersedes all prior agreements or
understandings, except that the Asset Purchase Agreement and ancillary
agreements referenced therein are not intended to be superseded but are intended
to be read in conjunction and harmony herewith.
9.4 GOVERNING LAW. This Agreement shall be governed by and construed
in accordance with the laws of the State of New York without regard to conflict
of law principles.
9.5 ASSIGNMENT. No party hereto may assign this Transition Services
Agreement, or any of its rights or obligations hereunder (subject to Section 4),
without the prior written consent of the other party, and any attempted
assignment not in accordance herewith shall be null and void and of no force or
effect. Notwithstanding the foregoing, either party may assign this Transition
Services Agreement to an affiliate of such party or to a successor entity which
acquires substantially all of the assets of such party; provided that any such
assignment shall not relieve the assigning party of its obligations hereunder.
9.6 INDEPENDENT CONTRACTOR. The parties hereto acknowledge and
agree that in the performance of their respective duties and obligations
hereunder they are acting as independent contractors of each other, and neither
party shall represent that an employer/employee, partnership, joint venture, or
agency relationship exists between them, nor shall either party have the power
nor will either party represent that it has the power to bind the other party
hereto to any contract or agreement.
9.7 WAIVER. No waiver, termination or discharge of this Transition
Services Agreement, or any of the terms or provisions hereof, shall be binding
upon either party unless confirmed in writing. No waiver by either party of any
term or provision of this Transition Services Agreement or of any default
hereunder shall affect such party's right thereafter to enforce such term or
provision or to exercise any right or remedy in the event of any other default,
whether or not similar.
9.8 SEVERABILITY. If any provision of this Transition Services
Agreement shall be held void, voidable, invalid or inoperative, no other
provision of this Transition Services Agreement shall be affected as a result
thereof, and accordingly, the remaining provisions of this Transition Services
Agreement shall remain in full force and effect as though such void, voidable or
inoperative provision had not been contained herein.
9.9 BINDING EFFECT. This Transition Services Agreement shall be
binding upon and shall inure to the benefit of the parties hereto and their
respective successors, heirs, representatives and permitted assigns.
9.10 COUNTERPARTS. This Transition Services Agreement may be executed
in one or more counterparts, each of which shall be deemed to be an original,
but all of which together shall constitute the same agreement. Any signature
page of any such counterpart, or any electronic facsimile thereof, may be
attached or appended to any other counterpart to complete a fully executed
counterpart of this Transition Services Agreement, and any telecopy or other
facsimile transmission of any signature shall be deemed an original and shall
bind such party.
9.11 CAPTIONS, HEADINGS AND EXHIBITS. The captions and headings in
this Transition Services Agreement are for convenience of reference only and may
not be used in the construction or interpretations of this Transition Services
Agreement.
9.12 FURTHER ASSURANCES. Upon the reasonable request of the other
party, each party hereto agrees to take any and all actions necessary or
appropriate to give effect to the terms set forth in this Transition Services
Agreement.
9.13 INTERPRETATION. This Transition Services Agreement shall not be
construed more strongly against either party hereto regardless of which party is
responsible for its preparation, it being agreed that this Transition Services
Agreement was fully negotiated by both parties.
IN WITNESS WHEREOF, the undersigned have caused their respective duly
authorized representatives to execute this Transition Services Agreement as of
the day and year first above written.
AIRBOSS ACQUISITION TELCORDIA TECHNOLOGIES, INC.
CORPORATION
By: By:
------------------------------- ------------------------------------
Name: Name: Xxxx Xxxx
-----------------------------
Title: Title: Chief Financial Officer
----------------------------
SCHEDULE 1.3(A)
XXXX OF SALE
Reference is made to the Asset Purchase and Stock Sale Agreement, dated
July 24, 2000 (the "Agreement"), by and among Geoworks Corporation, a Delaware
corporation, Telcordia Technologies, Inc., a Delaware corporation (the
"Seller"), and Airboss Acquisition Corporation, a New Jersey corporation (the
"Buyer"). In consideration of the payment of the Purchase Price (as defined in
the Agreement) by the Buyer to the Seller pursuant to the Agreement, receipt of
which is hereby acknowledged, and the assumption by the Buyer of the Assumed
Contracts and Assumed Liabilities as provided in the Agreement, the Seller
hereby sells, conveys, transfers, assigns and delivers to the Buyer, to and for
the benefit of the Buyer and its successors and assigns, all of the Seller's
right, title and interest in and to the Acquired Assets (as defined in the
Agreement).
The Seller hereby constitutes and appoints the Buyer and its successors
and assigns, as the attorney-in-fact of the Seller, with full power of
substitution, to institute and prosecute, in the name of the Seller or the Buyer
but on behalf of and for the benefit of the Buyer, and at the expense of the
Buyer, all proceedings which the Buyer may deem desirable to collect, assert or
enforce any claim, right or title of any kind in or to the assets hereby sold,
transferred or assigned and to defend and compromise any and all actions, suits
or proceedings in connection with such assets. The Seller agrees that the
foregoing powers are coupled with an interest and are and shall be irrevocable
by the Seller in any manner or for any reason (including the dissolution of the
Seller).
The Seller agrees that, at any time and from time to time after the
delivery hereof, it will, upon the reasonable request and at the expense of the
Buyer, take all appropriate actions and execute and deliver all appropriate
documents, instruments and conveyances of any kind which may be desirable to
carry out the provisions of this Xxxx of Sale.
Dated: July 24, 2000 TELCORDIA TECHNOLOGIES, INC.
By:
------------------------
Name: Xxxx Xxxx
Title: Chief Financial Officer
SCHEDULE 1.3(B)
ASSIGNMENT AND ASSUMPTION AGREEMENT
ASSIGNMENT AND ASSUMPTION AGREEMENT, dated as of July 24, 2000 (this
"Agreement"), between Telcordia Technologies, Inc., a Delaware corporation
("Seller"), and Airboss Acquisition Corporation, a New Jersey corporation
("Buyer").
0 _______ Seller hereby assigns to Buyer all of its rights under each of the
agreements listed on SCHEDULE A annexed hereto (the "Assumed Agreements").
1 _______ Buyer hereby assumes, and agrees to pay, perform, discharge and carry
out all of the obligations and liabilities of Seller under, the Assumed
Agreements.
2 _______ The assumption by Buyer of the obligations and liabilities of Seller
pursuant to this Agreement shall, in all events, be construed so that none of
such obligations and liabilities shall be expanded, increased, broadened or
enlarged as to rights or remedies which third parties would have had against
Seller had the acquisition of the Acquired Assets (as defined in the Asset
Purchase and Stock Sale Agreement, dated July 24, 2000) by Buyer not taken
place. Nothing contained herein shall be deemed to foreclose Buyer from
contesting in good faith Seller's obligations and liabilities to third parties.
IN WITNESS WHEREOF, the undersigned have hereunto executed
this agreement as of the date written above.
TELCORDIA TECHNOLOGIES, INC.
By:
--------------------------
Name:
Title:
AIRBOSS ACQUISITION CORPORATION
By:
---------------------------
Name:
Title:
