Exhibit 4.23
PURCHASE AND SALE AGREEMENT
BETWEEN
MITEL KNOWLEDGE CORPORATION
AND
MITEL NETWORKS CORPORATION
DATED AS OF
NOVEMBER 1, 2002
November 1, 0000
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XXXXXXXX AND SALE AGREEMENT
THIS AGREEMENT is entered into as of November 1, 2002, BETWEEN:
Mitel Knowledge Corporation, a corporation incorporated under the laws of
Canada ( "MKC"),
- and -
Mitel Networks Corporation, a corporation incorporated under the laws of
Canada ( "MNC"),
WHEREAS:
A. MKC and MNC executed a Research and Development Agreement (the "R&D
Agreement"), effective as of March 27, 2001, pursuant to which MKC retained MNC
to perform certain research and development work;
B. MKC and MNC have agreed to terminate the R&D Agreement, as provided in a
Termination Agreement dated November 1, 2002;
NOW THEREFORE, the parties hereto agree as follows:
ARTICLE 1 - INTERPRETATION
1.01 Definitions
In this Agreement, the following capitalized terms and expressions shall
have the meanings hereinafter ascribed thereto:
(a) "Act" means the Income Tax Act (Canada), as amended;
(b) "Agreement" means this agreement, including its recitals and
schedules, as amended from time to time;
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(c) "Effective Time" means 2:00 p.m. Eastern Standard Time on November
1, 2002;
(d) "Laws" means legally binding laws, statutes, by-laws and ordinances
of any Governmental Authority having jurisdiction;
(e) "MKC Technology" has the meaning set out in Section 10 of the R&D
Agreement, but, for greater certainty, does not include any
technology that has been independently developed by MKC including,
but not limited to, that embodied in the Mitel Networks 3050 ICP,
and the additional work done to complete the SIP capable 5055 and
5056 IP phones from the working prototype stage reached by MNC;
(f) "Note" has the meaning set out in Section 2.07;
(g) "Price" has the meaning set out in Section 2.04
(h) "MNC Shares" has the meaning set out in Section 2.05.
(i) "Purchased Assets" has the meaning set out in Section 2.01;
1.02 Interpretation
In this Agreement:
(a) all references to a designated "Article", "section", "subsection" or
other subdivision or to a Schedule are to the designated Article,
section, subsection or other subdivision of or Schedule to this
Agreement;
(b) the words "herein", "hereof", "hereunder" and other words of similar
import refer to this Agreement as a whole and not to any particular
Article, section, subsection, Schedule or other subdivision of this
Agreement;
(c) the headings are for convenience only and do not form a part of this
Agreement and are not intended to interpret, define or limit the
scope, extent or intent of this Agreement or any of its provisions;
(d) the singular of any term includes the plural, and vice versa; any
reference to the masculine, feminine or neuter genders, as the case
may be, includes a reference to each of the masculine, feminine or
neuter genders, as the case may be, and, where applicable, a
corporation; the word "or" is not exclusive and the word
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"including" is not limiting whether or not non-limiting language is
used with reference thereto; and
(e) any reference to a statute includes a reference to such statute and
to the regulations made pursuant thereto, as in effect from time to
time.
1.03 Currency
All references to currency herein are to lawful money of Canada.
ARTICLE 2 - SALE AND PURCHASE
2.01 Assets to be Sold and Purchased
Upon and subject to the terms and conditions hereof, MKC hereby sells,
conveys, transfers and assigns to MNC and MNC hereby purchases and acquires from
MKC, as of the Effective Time, all of the right, title, benefit and interest of
MKC in the MKC Technology held in the name of MKC (the "Purchased Assets").
2.02 Transfer on an "As Is" Basis
MNC acknowledges and agrees with MKC that MNC is acquiring the Purchased
Assets on an "as is, where is" basis, without any representation or warranty,
covenant or indemnification by MKC.
2.03 Registration of Ownership of Purchased Assets
MKC and MNC shall execute the "short form" patent and copyright assignment
agreements attached hereto as Schedules "A" and "B" to fully effect the transfer
of rights in the patent and copyrights identified in said schedules. MKC shall
request the recordal of said short term assignment documentation in all
jurisdictions in which said patents and copyrights exist at the Effective Time
and shall diligently and in good faith do all things required to effect recordal
of said assignments in a timely fashion. MNC shall submit to MKC a list of such
patents and copyrights and shall identify the relevant jurisdictions prior to
requesting the execution and filing of the assignments.
2.04 Price
The price payable to MKC for the Purchased Assets is $12,526,713 (the
"Price"), which MKC and MNC agree represents their fair market value and is the
sum of the following:
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Class 44 Patents $1,565,839
Class 12 In-process R&D $10,960,874
2.05 Payment of Price
The Price shall be paid or satisfied by MNC allotting, issuing and
delivering to the MKC 4,555,169 common shares in the capital of MNC (the "MNC
Shares") upon execution hereof, which MNC Shares shall :
(i) have a stated capital in the aggregate equal to the Price;
(ii) be issued as fully paid and non-assessable.
2.06 Rollover Elections
(1) MNC and MKC undertake to jointly elect under Section 85 of the Act
and any applicable similar provisions under the laws of any province
of Canada within the time and in the form prescribed using the Price
allocation set out at Section 2.04. MNC and MKC agree that the
elected proceeds of disposition for each class of Purchased Assets
shall be the undepreciated capital cost of such class as that amount
is defined under the Act.
(2) In the event that the Canada Customs and Revenue Agency or any other
competent taxing authority at any time proposes to issue or issues
any assessment or reassessment on the basis that the undepreciated
capital cost of any class of Purchased Assets is less than or
greater than the elected proceeds of disposition, then to the full
extent permitted under applicable Law, MKC and MNC shall adjust
amounts set out in the election referred to in section 2.06(1)
retroactively, with effect on the Effective Time, and MKC and MNC
shall jointly amend the election form accordingly within the time
and in the form prescribed.
2.07 Transfer Taxes and IP Registration Fees
(1) MNC shall be responsible to pay any applicable GST on the transfer
of the Purchased Assets.
(2) MKC shall be responsible to pay all registration, assignment or
transfer fees or taxes for the Purchased Assets.
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ARTICLE 3 - THE CLOSING DELIVERIES
3.01 Deliveries
MNC hereby delivers to MKC a share certificate dated as of the Effective
Time in favour of MKC evidencing 4,555,169 MNC Shares.
ARTICLE 4 - GENERAL
4.01 Benefit of the Agreement
This Agreement shall enure to the benefit of and be binding upon the
respective heirs, executors, administrators, other legal representatives,
successors and permitted assigns of the parties hereto.
4.02 Amendments and Waivers
No amendment to this Agreement shall be valid or binding unless set forth
in writing and duly executed by both of the parties hereto. No waiver of any
breach of any provision of this Agreement shall be effective or binding unless
made in writing and signed by the party purporting to give the same and, unless
otherwise provided, shall be limited to the specific breach waived.
4.03 Assignment
This Agreement may not be assigned by MKC or MNC without the prior written
consent of the other.
4.04 Notices
Any demand, notice or other communication to be given in connection with
this Agreement must be given in writing and shall be given by personal delivery,
by registered mail or by electronic means of communication addressed to the
recipient as follows:
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To MKC:
Mitel Knowledge Corporation
000 Xxxxxx Xxxxx, Xxxxx 000
Xxxxxx, Xxxxxxx
X0X 0X0,
Fax No.: (000) 000-0000
Attention: Xxxx Xxxxxxxxx
To MNC:
Mitel Networks Corporation
000 Xxxxxx Xxxxx
Xxxxxx, Xxxxxxx
X0X 0X0
Fax No.: (000) 000-0000
Attention: Xxxxxxx Xxxxxxxx
or to such other address, individual or electronic communication number as may
be designated by notice given by either party to the other. Any demand, notice
or other communication given by personal delivery shall be conclusively deemed
to have been given on the day of actual delivery thereof and, if given by
registered mail, on the fifth Business Day following the deposit thereof in the
mail and, if given by electronic communication, on the day of transmittal
thereof if given during the normal business hours of the recipient and on the
Business Day during which such normal business hours next occur if not given
during such hours on any day.
4.05 Governing Law
This Agreement is governed by and shall be construed in accordance with
the laws of the Province of Ontario and the laws of Canada applicable therein.
4.06 Attornment
For the purpose of all legal proceedings this Agreement shall be deemed to
have been performed in the Province of Ontario and the courts of the Province of
Ontario shall have jurisdiction to entertain any action arising under this
Agreement. The Parent Corporation and the Subsidiary each hereby attorns to the
non-exclusive jurisdiction of the courts of the Province of Ontario.
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4.07 Counterparts
This Agreement may be executed in any number of counterparts, each of
which shall be deemed to be an original and all of which taken together shall be
deemed to constitute one and the same instrument.
IN WITNESS WHEREOF the parties have executed and delivered this Agreement
as of the date first written above.
MITEL KNOWLEDGE CORPORATION
Per:
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MITEL NETWORKS CORPORATION
Per:
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