CONTRIBUTION AGREEMENT
BETWEEN
SERVATRON, INC.
AND
ITRON, INC.
May 15, 2000
TABLE OF CONTENTS
Page
ARTICLE I
SALE OF ASSETS AND CLOSING.....................................................1
1.1 Assets Transferred...........................................1
1.2 Liabilities..................................................1
1.3 Purchase Price; Allocation...................................2
1.4 Closing......................................................2
1.5 Further Assurances; Post-Closing Cooperation.................2
ARTICLE II
REPRESENTATIONS AND WARRANTIES OF ITRON........................................3
2.1 Organization of ITRON........................................3
2.2 Authority; Binding Nature of Agreement.......................3
2.3 Noncontravention.............................................4
2.4 Books and Records.................................... .......4
2.5 No Undisclosed Liabilities...................................4
2.6 No Warranties................................................4
2.7 Brokers............................................... ......4
2.8 Product Liability............................................4
2.9 Transition Benefits..........................................4
ARTICLE III
REPRESENTATIONS AND WARRANTIES OF SERVATRON....................................4
3.1 Organization.................................................4
3.2 Authority....................................................5
3.3 Capitalization...............................................5
3.4 Noncontravention.............................................5
3.5 Brokers......................................................5
3.6 Legal Proceedings............................................5
3.7 Insurance....................................................6
3.8 Labor Matters................................................6
3.9 Environmental, Health, and Safety Matters....................6
3.10 Employee Benefits............................................6
3.11 Tax Matters..................................................6
3.12 Intellectual Property........................................7
ARTICLE IV
COVENANTS OF ITRON.............................................................7
4.1 Regulatory and Other Approvals...............................7
4.2 Securities Law Matters.......................................8
4.3 Notice and Cure..............................................8
4.4 Fulfillment of Conditions....................................8
ARTICLE V
COVENANTS OF SERVATRON.........................................................8
5.1 Regulatory and Other Approvals...............................8
5.2 Notice and Cure..............................................9
5.3 Fulfillment of Conditions....................................9
ARTICLE VI
CONDITIONS TO OBLIGATIONS OF SERVATRON.........................................9
6.1 Representations and Warranties...............................9
6.2 Performance.................................................10
6.3 Closing Certificates........................................10
6.4 Orders and Laws.............................................10
6.5 Regulatory Consents and Approvals...........................10
6.6 Opinion of Counsel..........................................10
6.7 Shareholders' Agreement.....................................10
6.8 Deliveries..................................................10
6.9 Completion of Due Diligence.................................11
6.10 Proceedings.................................................11
ARTICLE VII
CONDITIONS TO OBLIGATIONS OF ITRON............................................11
7.1 Representations and Warranties..............................11
7.2 Performance.................................................11
7.3 Closing Certificates........................................11
7.4 Orders and Laws.............................................11
7.5 Regulatory Consents and Approvals...........................11
7.6 Opinion of Counsel..........................................12
7.7 Shareholders' Agreement.....................................12
7.8 Completion of Due Diligence.................................12
7.9 Proceedings.................................................12
ARTICLE VIII
NON-SOLICITATION..............................................................12
ARTICLE IX
SURVIVAL OF REPRESENTATIONS, WARRANTIES,
COVENANTS AND AGREEMENTS.............................................12
ARTICLE X
INDEMNIFICATION...............................................................13
10.1 ITRON's Indemnification.....................................13
10.2 Servatron's Indemnification.................................13
10.3 Indemnification Procedure...................................13
10.4 Exclusivity.................................................14
ARTICLE XI
TERMINATION...................................................................14
11.1 Termination.................................................14
11.2 Effect of Termination.......................................14
ARTICLE XII
DEFINITIONS...................................................................15
12.1 Defined Terms...............................................15
12.2 Construction of Certain Terms and Phrases...................19
ARTICLE XIII
MISCELLANEOUS.................................................................19
13.1 Notices.....................................................19
13.2 Entire Agreement............................................20
13.3 Expenses....................................................20
13.4 Public Announcements........................................20
13.5 Confidentiality.............................................21
13.6 Waiver......................................................21
13.7 Amendment...................................................21
13.8 No Third Party Beneficiary..................................21
13.9 No Assignment; Binding Effect...............................21
13.10 Headings 22
13.11 Arbitration.................................................22
13.12 Invalid Provisions..........................................22
13.13 Governing Law...............................................22
13.14 Remedies................................................... 23
13.15 Attorneys'Fees..............................................23
13.16 Counterparts................................................23
CONTRIBUTION AGREEMENT BETWEEN
SERVATRON, INC. AND ITRON, INC.
THIS CONTRIBUTION AGREEMENT, dated as of May 15, 2000, is made and
entered into by and between SERVATRON, INC., a Washington corporation
("Servatron"), and ITRON, INC., a Washington corporation ("ITRON"). Capitalized
terms not otherwise defined herein have the meanings set forth in Section 12.1.
RECITALS
A. ITRON is engaged in the business of manufacturing and
selling data acquisition and wireless communication equipment for collecting and
analyzing electric, gas, and water usage data; and
B. ITRON desires to sell, transfer and assign to Servatron, and
Servatron desires to purchase and acquire from ITRON, certain of the assets of
ITRON relating to the operation of ITRON's manufacturing and depot service
business.
C. As consideration for the sale of the manufacturing equipment,
Servatron has agreed to issue, and ITRON has agreed to accept, 3,000,000 shares
of Servatron's Series A Preferred Stock.
AGREEMENT
NOW, THEREFORE, in consideration of the mutual covenants and agreements
set forth in this Agreement, and for other good and valuable consideration, the
receipt and sufficiency of which are hereby acknowledged, the parties agree as
follows:
ARTICLE I
SALE OF ASSETS AND CLOSING
1.1 Assets Transferred. On the terms and subject to the conditions set forth in
this Agreement, ITRON will sell, transfer, convey, assign and deliver to
Servatron, and Servatron will purchase and pay for, at the Closing, free and
clear of all Liens other than Permitted Liens, all of ITRON's right, title and
interest in, to and under the assets of ITRON listed in Section 1.1 of the
Disclosure Schedule, as the same shall exist on the Closing Date (collectively,
the "Assets"):
1.2 Liabilities. Except for obligations assumed in connection with the Depot
Repair Services Agreement and the Manufacturing Agreement, Servatron shall not
assume by virtue of this Agreement or the transactions contemplated hereby, and
shall have no liability for, any Liabilities of ITRON. ITRON shall be
responsible for any and all Liabilities of any kind, character or description
arising from the Assets prior to the Closing Date. Servatron shall be
responsible for any and all Liabilities of any kind, character or description
arising from the Assets as of the Closing Date.
1.3 Purchase Price; Allocation.
(a) Purchase Price. The consideration to be paid by Servatron to ITRON for the
Assets is the issuance to ITRON of 3,000,000 shares of preferred stock, $0.001
par value per share, of Servatron ("Servatron Preferred Stock"), which number of
shares shall be equal to thirty percent (30%) of the fully diluted issued and
outstanding shares of common stock of Servatron as of the date of Closing
(including any issued and outstanding convertible preferred stock of Servatron
and any shares of stock of Servatron reserved or set aside for issuance by
Servatron pursuant to stock options, warrants or other rights).
(b) Servatron and ITRON agree that the Assets have a fair market value of One
Million Dollars ($1,000,000) and agree to allocate that amount to the Assets as
set forth in Disclosure Schedule 1.1.
1.4 Closing. The Closing will take place at the offices of Xxxxxx & Xxxx PC,
located at 0000 Xxxxx Xxxxxx, 00xx Xxxxx, Xxxxxxx, Xxxxxxxxxx 00000, or at such
other place as Servatron and ITRON mutually agree, at 11:00 A.M. Pacific
Standard Time, on May 15, 2000, or if the conditions specified in Articles VI
and VII are not satisfied on the Closing Date, at such later date when such
conditions are satisfied, as agreed to by the parties. ITRON will assign and
transfer to Servatron good and valid title in and to the Assets (free and clear
of all Liens by delivery of the duly executed: (a) Xxxx of Sale substantially in
the form of Exhibit A hereto (the "Xxxx of Sale"), (b) Manufacturing Agreement;
(c) Depot Repair Services Agreement; (d) Shareholders Agreement; (e) Closing
Certificate of ITRON; (f) Secretary's Certificate of ITRON; and (g) Opinion of
Counsel from ITRON's Counsel. At Closing Servatron shall deliver to ITRON the
duly executed: (a) original Stock Certificate representing the Servatron
Preferred Stock; (b) Manufacturing Agreement; (c) Depot Repair Services
Agreement; (d) Shareholders Agreement; (e) Closing Certificate of Servatron; (f)
Secretary's Certificate of Servatron; and (g) Opinion of Counsel from
Servatron's Counsel.
1.5 Further Assurances; Post-Closing Cooperation.
(a) At any time or from time to time after the Closing, at Servatron's request
and without further consideration, ITRON shall execute and deliver to Servatron
such other instruments of sale, transfer, conveyance, assignment and
confirmation, provide such materials and information and take such other actions
as Servatron may reasonably deem necessary or desirable in order more
effectively to transfer, convey and assign to Servatron, and to confirm
Servatron's title to, all of the Assets, and, to the full extent permitted by
Law, to put Servatron in actual possession and operating control of the Assets
(the "Assignment Instruments") and to assist Servatron in exercising all rights
with respect thereto, and otherwise to cause ITRON to fulfill its obligations
under this Agreement and the Operative Agreements.
(b) Following the Closing, each party will afford the other party, its counsel
and its accountants, during normal business hours, reasonable access to the
books, records and other data relating to the Assets in its possession with
respect to periods prior to the Closing and the right to make copies and
extracts therefrom, to the extent that such access may be reasonably required by
the requesting party in connection with (i) the preparation of Tax Returns, (ii)
the determination or enforcement of rights and obligations under this Agreement
or any Operative Agreement, (iii) compliance with the requirements of any
Governmental or Regulatory Authority, (iv) the determination or enforcement of
the rights and obligations of any Indemnified Party or (v) in connection with
any actual or threatened Action or Proceeding. Further each party agrees for a
period extending six (6) years after the Closing Date not to destroy or
otherwise dispose of any such books, records and other data unless such party
shall first offer in writing to surrender such books, records and other data to
the other party and such other party shall not agree in writing to take
possession thereof during the ten (10) day period after such offer is made.
(c) If, in order properly to prepare its Tax Returns, other documents or reports
required to be filed with Governmental or Regulatory Authorities or its
financial statements or to fulfill its obligations hereunder, it is necessary
that a party be furnished with additional information, documents or records
relating to the Assets not referred to in paragraph (c) above, and such
information, documents or records are in the possession or control of the other
party, such other party shall use its best efforts to furnish or make available
such information, documents or records (or copies thereof) at the recipient's
request, cost and expense. Any information obtained by either party in
accordance with this paragraph shall be held confidential by such party in
accordance with Section 13.5.
(d) Notwithstanding anything to the contrary contained in this Section 1.5, if
the parties are in an adversarial relationship in litigation or arbitration, the
furnishing of information, documents or records in accordance paragraphs (b) or
(c) of this Section shall be subject to applicable rules relating to discovery.
ARTICLE II
REPRESENTATIONS AND WARRANTIES OF
ITRON
ITRON hereby represents and warrants to Servatron as follows:
2.1 Organization of ITRON. ITRON is a corporation validly existing under the
Laws of the State of Washington, and has full corporate power and authority to
own, use and lease the Assets.
2.2 Authority; Binding Nature of Agreement. ITRON has full corporate power and
authority to execute and deliver this Agreement and the Operative Agreements to
which it is a party, to perform its obligations hereunder and thereunder and to
consummate the transactions contemplated hereby and thereby, including, without
limitation, to sell and transfer (pursuant to this Agreement) the Assets. The
execution and delivery by ITRON of this Agreement and the Operative Agreements
to which it is a party, and the performance by ITRON of its obligations
hereunder and thereunder, have been duly and validly authorized by the Board of
Directors of ITRON. This Agreement has been duly and validly executed and
delivered by ITRON, and upon the execution and delivery by ITRON of the
Operative Agreements to which it is a party, such Operative Agreements will
constitute, legal, valid and binding obligations of ITRON enforceable against
ITRON in accordance with their terms.
2.3 Noncontravention. The execution, delivery and performance by ITRON of each
of this Agreement and the consummation of the transactions contemplated hereby,
do not violate or contravene any provision of its articles or certificate of
incorporation or by-laws and do not violate any applicable rule of Governmental
or Regulatory Authorities or result in a breach of or constitute a default under
any contract, obligation, indenture or other instrument to which it is a party
or by which it may be bound, which violation, breach or default would have an
ITRON Material Adverse Effect.
2.4 Books and Records. Except as set forth in Section 2.4 of the Disclosure
Schedule, none of the Books and Records are recorded, stored, maintained,
operated or otherwise wholly or partly dependent upon or held by any means
(including any electronic, mechanical or photographic process, whether
computerized or not) which (including all means of access thereto and therefrom)
are not under the exclusive ownership and direct control of one or more
Employees.
2.5 No Undisclosed Liabilities. Except as disclosed in Section 2.5 of the
Disclosure Schedule, ITRON has good, indefeasible, and merchantable title to and
ownership of the Assets free and clear of all Liens. There are no Liabilities or
Liens against, relating to or affecting any of the Assets.
2.6 No Warranties. ITRON does not warrant the condition of the Assets. All
Assets are provided "as is, where is," FOB ITRON's plant.
2.7 Brokers. All negotiations relative to this Agreement and the transactions
contemplated hereby have been carried out by ITRON directly with Servatron
without the intervention of any Person on behalf of ITRON in such manner as to
give rise to any valid claim by any Person against Servatron for a finder's fee,
brokerage commission or similar payment.
2.8 Product Liability. To the Knowledge of ITRON, ITRON has no Liability, and
there is no known basis for any present or future action, suit, proceeding,
hearing, investigation, charge, complaint, claim, or demand against ITRON giving
rise to any Liability, arising out of any injury to individuals or property as a
result of the ownership, possession, or use of any product distributed, sold or
delivered by ITRON that was manufactured using the Assets.
2.9 Transition Benefits. ITRON shall provide those Servatron employees who were
previously employed by ITRON and who are listed on Schedule 2.9 attached hereto
("Former Employees") with the transition benefits listed on such schedule for
the time periods specified thereon. The Former Employees and Xxxxx Xxxxxxxxx
shall not be subject to the non-solicitation provisions of Article VIII.
ARTICLE III
REPRESENTATIONS AND WARRANTIES OF SERVATRON
Servatron hereby represents and warrants to ITRON as follows:
3.1 Organization. Servatron is a corporation validly existing under the Laws of
the State of Washington. Servatron has full corporate power and authority to
enter into this Agreement and the Operative Agreements to which it is a party,
to perform its obligations hereunder and thereunder and to consummate the
transactions contemplated hereby and thereby.
3.2 Authority. Servatron has full corporate power and authority to execute and
deliver this Agreement and the Operative Agreements to which it is a party, to
perform its obligations hereunder and thereunder and to consummate the
transactions contemplated hereby and thereby, including, without limitation, to
sell and transfer (pursuant to this Agreement) the Assets. The execution and
delivery by Servatron of this Agreement and the Operative Agreements to which it
is a party, and the performance by Servatron of its obligations hereunder and
thereunder, have been duly and validly authorized by the Board of Directors of
Servatron and the Shareholders. This Agreement has been duly and validly
executed and delivered by Servatron, and upon the execution and delivery by
Servatron of the Operative Agreements to which it is a party, such Operative
Agreements will constitute, legal, valid and binding obligations of Servatron
enforceable against Servatron in accordance with their terms.
3.3 Capitalization. The authorized capital stock of Servatron is as set forth in
Section 3.3 of the Disclosure Schedule. No shares of such capital stock are
issued and outstanding except for the shares as identified in Section 3.3 of the
Disclosure Schedule. The shares of capital stock of Servatron are owned of
record and beneficially by the Persons in the number set forth in Section 3.3 of
the Disclosure Schedule. All such shares of capital stock are validly issued,
fully paid and nonassessable. Except as set forth on Section 3.3 of the
Disclosure Schedule, there are no (i) securities convertible into or
exchangeable for any of the capital stock or other securities of Servatron, (ii)
options, warrants or other rights to purchase or subscribe to capital stock or
other securities of Servatron or securities which are convertible into or
exchangeable for capital stock or other securities of Servatron, (iii)
contracts, commitments, agreements, understandings or arrangements of any kind
relating to the issuance, sale or transfer of any capital stock or other equity
securities of Servatron, any such convertible or exchangeable securities or any
such options, warrants or other rights or (iv) other Persons with an ownership
interest in the assets, properties or business of Servatron.
3.4 Noncontravention. The execution, delivery and performance by Servatron of
each of this Agreement and the consummation of the transactions contemplated
hereby, do not violate or contravene any provision of its articles or
certificate of incorporation or by-laws and do not violate any applicable rule
of Governmental or Regulatory Authorities or result in a breach of or constitute
a default under any contract, obligation, indenture or other instrument to which
it is a party or by which it may be bound, which violation, breach or default
would have a Servatron Material Adverse Effect.
3.5 Brokers. All negotiations relative to this Agreement and the transactions
contemplated hereby have been carried out by Servatron directly with ITRON
without the intervention of any Person on behalf of Servatron in such manner as
to give rise to any valid claim by any Person against Servatron for a finder's
fee, brokerage commission or similar payment.
3.6 Legal Proceedings. Except as disclosed in Section 3.6 of the Disclosure
Schedule there are no pending or, to Servatron's knowledge, threatened actions,
claims, investigations, suits or proceedings, by or before any governmental
authority, arbitrator, court or administrative agency that could have an
Servatron Material Adverse Effect.
3.7 Insurance. All current policies of insurance of any kind or nature owned by
or issued to Servatron, including, without limitation, policies of fire, theft,
product liability, public liability, property damage, other casualty, employee
fidelity, workers' compensation and employee health and welfare insurance, are
in full force and effect and are of a nature and provide such coverage as is
sufficient and as is customarily carried by companies of its size and character.
3.8 Labor Matters. Other than any of the following which in the aggregate have
no reasonable likelihood of having an Servatron Material Adverse Effect: (i)
there are no strikes, work stoppages, slowdowns or lockouts pending or to
Servatron's knowledge threatened against or involving it; (ii) there are no
arbitrations or grievances pending or to its knowledge threatened against or
involving it; (iii) there is no organizing activity involving it pending or to
its knowledge threatened by any labor union or group of employees; (iv) there
are no representation proceedings pending against it or to its knowledge
threatened with the National Labor Relations Board; (v) no labor organization or
group of its employees has made a pending demand on it for recognition; (vi)
there are no unfair labor practice charges, grievances or complaints pending or
in process or to its knowledge threatened by or on behalf of any employee or
group of its employees; (vii) there are no complaints or charges against it
pending or to its knowledge threatened to be filed with any federal, state or
local court, governmental agency or arbitrator based on, arising out of, in
connection with, or otherwise relating to its employment of any individual; and
(viii) it is in material compliance with all applicable rules and orders of
Governmental or Regulatory Authorities, and all orders of any Governmental
Authority or arbitrator, relating to the employment of labor including all such
laws relating to wages, hours, collective bargaining, discrimination, civil
rights, and the payment of withholding and/or social security and similar taxes.
As of the date hereof Servatron is not a party to, and has no obligations under,
any collective bargaining agreement.
3.9 Environmental, Health, and Safety Matters. Except as disclosed in Disclosure
Schedule 3.9, Servatron is in compliance in all material respects with all
Environmental Laws applicable to it, other than such noncompliance as in the
aggregate will not have an Servatron Material Adverse Effect. Servatron has not
received notice that it is the subject of any federal or state investigation
evaluating whether any Remedial Action is needed. There have been no Releases by
Servatron that could reasonably be expected to result in an Servatron Material
Adverse Effect.
3.10 Employee Benefits. Except as disclosed in Disclosure Schedule 3.10,
Servatron is in compliance in all material respects with the applicable
provisions of ERISA. Servatron has not violated any provision of any Plan
maintained or contributed to by it in a manner that could result in a Material
Adverse Effect. No "reportable event" (as defined in Title IV of ERISA) has
occurred and is continuing with respect to any Plan initiated by it.
3.11 Tax Matters. Except as disclosed in Disclosure Schedule 3.11, Servatron has
filed, or caused to be filed, all federal, state, local and foreign tax returns
required to be filed by it, and has paid, or caused to be paid, all taxes as are
shown on such returns, or on any assessment received by it, to the extent that
such taxes have become due, except as otherwise contested in good faith.
Servatron has set aside proper amounts on its books, determined in accordance
with GAAP, for the payment of all taxes for the years that have not been audited
by the respective tax authorities and for taxes being contested by it.
3.12 Intellectual Property. Except as disclosed in Disclosure Schedule 3.12,
Servatron owns or licenses or otherwise has the right to use all material
licenses, Permits, patents, patent applications, trademarks, trademark
applications, service marks, trade names, copyrights, copyright applications,
franchises, authorizations and other intellectual property rights that are
necessary for the operation of its businesses, without infringement upon or
conflict with the rights of any other Person with respect thereto, including
without limitation, all trade names. No slogan or other advertising device,
product, process, method, substance, part or other material now employed, or now
contemplated to be employed, by Servatron infringes upon or conflicts with any
rights owned by any other Person, which infringement or conflict is reasonably
likely to have an Servatron Material Adverse Effect, and no claim or litigation
regarding any of the foregoing is pending or, to its knowledge, threatened, the
existence of which is reasonably likely to have an Servatron Material Adverse
Effect. No patent, invention, device, application, principle or any statute,
law, rule, regulation, standard or code is pending or, to its knowledge,
proposed, other than those the consequences of which in the aggregate have no
reasonable likelihood of having an Servatron Material Adverse Effect.
ARTICLE IV
COVENANTS OF ITRON
ITRON hereby covenants and agrees with Servatron that, at all times
from and after the date of this Agreement until the Closing and, with respect to
any covenant or agreement by its terms to be performed in whole or in part after
the Closing, for the period specified herein or, if no period is specified
herein, for a period of two (2) years after the Closing, ITRON will comply with
all covenants and provisions of this Article IV, except to the extent Servatron
may otherwise consent in writing.
4.1 Regulatory and Other Approvals. ITRON will (a) take all commercially
reasonable steps necessary or desirable, and proceed diligently and in good
faith and use all commercially reasonable efforts, as promptly as practicable to
obtain all consents, approvals or actions of, to make all filings with and to
give all notices to Governmental or Regulatory Authorities or any other Person
required of ITRON to consummate the transactions contemplated hereby and by the
Operative Agreements, (b) provide such other information and communications to
such Governmental or Regulatory Authorities or other Persons as Servatron or
such Governmental or Regulatory Authorities or other Persons may reasonably
request in connection therewith and (c) cooperate with Servatron as promptly as
practicable in obtaining all consents, approvals or actions of, making all
filings with and giving all notices to Governmental or Regulatory Authorities or
other Persons required of Servatron to consummate the transactions contemplated
hereby and by the Operative Agreements. ITRON will provide prompt notification
to Servatron when any such consent, approval, action, filing or notice referred
to in clause (a) above is obtained, taken, made or given, as applicable, and
will advise Servatron of any communications (and, unless precluded by Law,
provide copies of any such communications that are in writing) with any
Governmental or Regulatory Authority or other Person regarding any of the
transactions contemplated by this Agreement or any of the Operative Agreements.
4.2 Securities Law Matters. ITRON agrees to hold the Servatron Preferred Stock
received pursuant to this Agreement pursuant to the terms of the investment
letter attached hereto as Exhibit B.
4.3 Notice and Cure. ITRON will notify Servatron in writing (where appropriate,
through updates to the Disclosure Schedule) of, and contemporaneously will
provide Servatron with true and complete copies of any and all information or
documents relating to, and will use all commercially reasonable efforts to cure
before the Closing, any event, transaction or circumstance, as soon as
practicable after it becomes Known to ITRON, occurring after the date of this
Agreement that causes or will cause any covenant or agreement of ITRON under
this Agreement to be breached or that renders or will render untrue any
representation or warranty of ITRON contained in this Agreement as if the same
were made on or as of the date of such event, transaction or circumstance. ITRON
also will notify Servatron in writing (where appropriate, through updates to the
Disclosure Schedule) of, and will use all commercially reasonable efforts to
cure, before the Closing, any violation or breach, as soon as practicable after
it becomes Known to ITRON, of any representation, warranty, covenant or
agreement made by ITRON in this Agreement, whether occurring or arising before,
on or after the date of this Agreement. No notice given pursuant to this Section
shall have any effect on the representations, warranties, covenants or
agreements contained in this Agreement for purposes of determining satisfaction
of any condition contained herein or shall in any way limit Servatron's right to
seek indemnity under Article X.
4.4 Fulfillment of Conditions. ITRON will execute and deliver at the Closing
each Operative Agreement that ITRON is required hereby to execute and deliver as
a condition to the Closing, will take all commercially reasonable steps
necessary or desirable and proceed diligently and in good faith to satisfy each
other condition to the obligations of Servatron contained in this Agreement and
will not take or fail to take any action that could reasonably be expected to
result in the nonfulfillment of any such condition.
ARTICLE V
COVENANTS OF SERVATRON
Servatron covenants and agrees with ITRON that, at all times from and
after the date of this Agreement until the Closing and, with respect to any
covenant or agreement by its terms to be performed in whole or in part after the
Closing, for the period specified herein or, if no period is specified herein,
for a period of two (2) years after the Closing, Servatron will comply with all
covenants and provisions of this Article V, except to the extent ITRON may
otherwise consent in writing.
5.1 Regulatory and Other Approvals. Servatron will (a) take all commercially
reasonable steps necessary or desirable, and proceed diligently and in good
faith and use all commercially reasonable efforts, as promptly as practicable to
obtain all consents, approvals or actions of, to make all filings with and to
give all notices to Governmental or Regulatory Authorities or any other Person
required of Servatron to consummate the transactions contemplated hereby and by
the Operative Agreements, (b) provide such other information and communications
to such Governmental or Regulatory Authorities or other Persons as ITRON or such
Governmental or Regulatory Authorities or other Persons may reasonably request
in connection therewith and (c) cooperate with ITRON as promptly as practicable
in obtaining all consents, approvals or actions of, making all filings with and
giving all notices to Governmental or Regulatory Authorities or other Persons
required of ITRON to consummate the transactions contemplated hereby and by the
Operative Agreements. Servatron will provide prompt notification to ITRON when
any such consent, approval, action, filing or notice referred to in clause (a)
above is obtained, taken, made or given, as applicable, and will advise ITRON of
any communications (and, unless precluded by Law, provide copies of any such
communications that are in writing) with any Governmental or Regulatory
Authority or other Person regarding any of the transactions contemplated by this
Agreement or any of the Operative Agreements.
5.2 Notice and Cure. Servatron will notify ITRON in writing of, and
contemporaneously will provide ITRON with true and complete copies of any and
all information or documents relating to, and will use all commercially
reasonable efforts to cure before the Closing, any event, transaction or
circumstance, as soon as practicable after it becomes Known to Servatron,
occurring after the date of this Agreement that causes or will cause any
covenant or agreement of Servatron under this Agreement to be breached or that
renders or will render untrue any representation or warranty of Servatron
contained in this Agreement as if the same were made on or as of the date of
such event, transaction or circumstance. Servatron also will notify ITRON in
writing of, and will use all commercially reasonable efforts to cure, before the
Closing, any violation or breach, as soon as practicable after it becomes Known
to Servatron, of any representation, warranties, covenant or agreement made by
Servatron in this Agreement, whether occurring or arising before, on or after
the date of this Agreement. No notice given pursuant to this Section shall have
any effect on the representations, warranties, covenants or agreements contained
in this Agreement for purposes of determining satisfaction of any condition
contained herein or shall in any way limit ITRON's right to seek indemnity under
Article X.
5.3 Fulfillment of Conditions. Servatron will execute and deliver at the Closing
each Operative Agreement that Servatron is hereby required to execute and
deliver as a condition to the Closing, will take all commercially reasonable
steps necessary or desirable and proceed diligently and in good faith to satisfy
each other condition to the obligations of ITRON contained in this Agreement and
will not take or fail to take any action that could reasonably be expected to
result in the nonfulfillment of any such condition.
ARTICLE VI
CONDITIONS TO OBLIGATIONS OF SERVATRON
The obligations of Servatron hereunder to purchase the Assets are
subject to the fulfillment, at or before the Closing, of each of the following
conditions (all or any of which may be waived in whole or in part by Servatron
in its sole discretion):
6.1 Representations and Warranties. Each of the representations and warranties
made by ITRON in this Agreement (other than those made as of a specified date
earlier than the Closing Date) shall be true and correct in all material
respects on and as of the Closing Date as though such representation or warranty
was made on and as of the Closing Date, and any representation or warranty made
as of a specified date earlier than the Closing Date shall have been true and
correct in all material respects on and as of such earlier date.
6.2 Performance. ITRON shall have performed and complied with, in all material
respects, each agreement, covenant and obligation required by this Agreement or
any Operative Agreement to be so performed or complied with by ITRON at or
before the Closing.
6.3 Closing Certificates. ITRON shall have delivered to Servatron a certificate,
dated the Closing Date and executed by the Chairman of the Board, the President
or any Vice President of ITRON, substantially in the form and to the effect of
Exhibit C hereto, and a certificate, dated the Closing Date and executed by the
Secretary or any Assistant Secretary of ITRON, substantially in the form and to
the effect of Exhibit D hereto.
6.4 Orders and Laws. There shall not be in effect on the Closing Date any Order
or Law restraining, enjoining or otherwise prohibiting or making illegal the
consummation of any of the transactions contemplated by this Agreement or any of
the Operative Agreements or which could reasonably be expected to otherwise
result in a material diminution of the benefits of the transactions contemplated
by this Agreement or any of the Operative Agreements to Servatron, and there
shall not be pending or threatened on the Closing Date any Action or Proceeding
or any other action in, before or by any Governmental or Regulatory Authority
which could reasonably be expected to result in the issuance of any such Order
or the enactment, promulgation or deemed applicability to Servatron or the
transactions contemplated by this Agreement or any of the Operative Agreements
of any such Law.
6.5 Regulatory Consents and Approvals. All consents, approvals and actions of,
filings with and notices to any Governmental or Regulatory Authority necessary
to permit Servatron and ITRON to perform their obligations under this Agreement
and the Operative Agreements and to consummate the transactions contemplated
hereby and thereby (a) shall have been duly obtained, made or given, (b) shall
be in form and substance reasonably satisfactory to Servatron, (c) shall not be
subject to the satisfaction of any condition that has not been satisfied or
waived and (d) shall be in full force and effect, and all terminations or
expirations of waiting periods imposed by any Governmental or Regulatory
Authority necessary for the consummation of the transactions contemplated by
this Agreement and the Operative Agreements shall have occurred.
6.6 Opinion of Counsel. Servatron shall have received the opinion of Xxxxxxx
Coie. LLP, counsel to ITRON, dated the Closing Date, substantially in the form
and to the effect of Exhibit E hereto.
6.7 Shareholders' Agreement. ITRON shall have entered into a shareholders'
agreement and a stock restriction agreement, substantially in the form and to
the effect of Exhibit F hereto (the "Shareholders' Agreement").
6.8 Deliveries. ITRON shall have delivered to Servatron the Xxxx of Sale and the
other Assignment Instruments.
6.9 Completion of Due Diligence. Servatron shall have completed its due
diligence review of ITRON and shall have been satisfied, in its sole discretion,
with the results thereof.
6.10 Proceedings. All proceedings to be taken on behalf of ITRON in connection
with the transactions contemplated by this Agreement and all documents incident
thereto shall be reasonably satisfactory in form and substance to Servatron, and
Servatron shall have received copies of all such documents and other evidences
as Servatron may reasonably request in order to establish the consummation of
such transactions and the taking of all proceedings in connection therewith.
ARTICLE VII
CONDITIONS TO OBLIGATIONS OF ITRON
The obligations of ITRON hereunder to sell the Assets are subject to
the fulfillment, at or before the Closing, of each of the following conditions
(all or any of which may be waived in whole or in part by ITRON in its sole
discretion):
7.1 Representations and Warranties. Each of the representations and warranties
made by Servatron in this Agreement shall be true and correct in all material
respects on and as of the Closing Date as though such representation or warranty
was made on and as of the Closing Date.
7.2 Performance. Servatron shall have performed and complied with, in all
material respects, each agreement, covenant and obligation required by this
Agreement or any Operative Agreement to be so performed or complied with by
Servatron at or before the Closing.
7.3 Closing Certificates. Servatron shall have delivered to ITRON a certificate,
dated the Closing Date and executed by the Chairman of the Board, the President
or any Vice President of Servatron, substantially in the form and to the effect
of Exhibit G hereto, and a certificate, dated the Closing Date and executed by
the Secretary or any Assistant Secretary of Servatron, substantially in the form
and to the effect of Exhibit H hereto.
7.4 Orders and Laws. There shall not be in effect on the Closing Date any Order
or Law that became effective after the date of this Agreement restraining,
enjoining or otherwise prohibiting or making illegal the consummation of any of
the transactions contemplated by this Agreement or any of the Operative or which
could reasonably be expected to otherwise result in a material diminution of the
benefits of the transactions contemplated by this Agreement or any of the
Operative Agreements to ITRON, and there shall not be pending or threatened on
the Closing Date any Action or Proceeding or any other action in, before or by
any Governmental or Regulatory Authority which could reasonably be expected to
result in the issuance of any such Order or the enactment, promulgation or
deemed applicability to ITRON or the transactions contemplated by this Agreement
or any of the Operative Agreements of any such Law.
7.5 Regulatory Consents and Approvals. All consents, approvals and actions of,
filings with and notices to any Governmental or Regulatory Authority necessary
to permit ITRON and Servatron to perform their obligations under this Agreement
and the Operative Agreements and to consummate the transactions contemplated
hereby and thereby (a) shall have been duly obtained, made or given, (b) shall
not be subject to the satisfaction of any condition that has not been satisfied
or waived and (c) shall be in full force and effect, and all terminations or
expirations of waiting periods imposed by any Governmental or Regulatory
Authority necessary for the consummation of the transactions contemplated by
this Agreement and the Operative Agreements shall have occurred.
7.6 Opinion of Counsel. ITRON shall have received the opinion of Xxxxxx & Xxxx
PC, counsel to Servatron, dated the Closing Date, substantially in the form and
to the effect of Exhibit I hereto.
7.7 Shareholders' Agreement. The shareholders of Servatron listed in Section 3.3
of the Disclosure Schedule shall have entered into the Shareholders' Agreement.
7.8 Completion of Due Diligence. ITRON shall have completed its due diligence
review of Servatron and shall have been satisfied, in its sole discretion, with
the results thereof.
7.9 Proceedings. All proceedings to be taken on the part of Servatron in
connection with the transactions contemplated by this Agreement and all
documents incident thereto shall be reasonably satisfactory in form and
substance to ITRON, and ITRON shall have received copies of all such documents
and other evidences as ITRON may reasonably request in order to establish the
consummation of such transactions and the taking of all proceedings in
connection therewith.
ARTICLE VIII
NON-SOLICITATION
Servatron agrees not to solicit or hire any employees of ITRON for one
year from the date of this Agreement. ITRON agrees not to hire any employees of
Servatron for one year from the date of this Agreement. Notwithstanding the
foregoing, Servatron may hire employees of ITRON who have been terminated by
ITRON or who have resigned at ITRON's request and ITRON may hire employees of
Servatron who have been terminated by Servatron who have resigned at Servatron's
request.
ARTICLE IX
SURVIVAL OF REPRESENTATIONS, WARRANTIES,
COVENANTS AND AGREEMENTS
Notwithstanding any right of Servatron to investigate the accuracy of
the representations and warranties of the other party contained in this
Agreement, ITRON and Servatron have the right to rely fully upon the
representations, warranties, covenants and agreements of the other contained in
this Agreement. The representations, warranties, covenants and agreements of
ITRON and Servatron contained in this Agreement will survive the Closing (a)
until sixty (60) days after the expiration of all applicable statutes of
limitation (including all periods of extension, whether automatic or permissive)
with respect to the representations and warranties or (b) with respect to the
covenants or agreements contained in this Agreement, until sixty (60) days
following the last date on which such covenant or agreement is to be performed
or, if no such date is stated for twelve (12) months after Closing, except that
any representation, warranty, covenant or agreement that would otherwise
terminate in accordance with clause (a) or (b) above will continue to survive if
a claim for indemnity shall have been made under Article IX on or prior to such
termination date, until such claim has been satisfied or otherwise resolved.
ARTICLE X
INDEMNIFICATION
10.1 ITRON's Indemnification. ITRON shall indemnify the Servatron Indemnified
Parties in respect of, and hold each of them harmless from and against, any and
all Losses suffered, incurred or sustained by any of them or to which any of
them becomes subject, resulting from, arising out of or relating to any
misrepresentation, breach of warranty or nonfulfillment of or failure to perform
any covenant or agreement on the part of ITRON contained in this Agreement
(determined in all cases as if the terms "material" or "materially" were not
included therein) and for any Losses or Liabilities arising from the Assets
incurred prior to the Closing Date.
10.2 Servatron's Indemnification. Servatron shall indemnify the ITRON
Indemnified Parties in respect of, and hold each of them harmless from and
against, any and all Losses suffered, incurred or sustained by any of them or to
which any of them becomes subject, resulting from, arising out of or relating to
any misrepresentation, breach of warranty or nonfulfillment of or failure to
perform any covenant or agreement on the part of Servatron contained in this
Agreement (determined in all cases as if the terms "material" or "materially"
were not included therein) and for any Losses or Liabilities arising from the
Assets arising on or after the Closing Date.
10.3 Indemnification Procedure.
(a) Upon obtaining knowledge thereof, the party to be indemnified hereunder (the
"Indemnitee") shall promptly notify the indemnifying party hereunder (the
"Indemnitor") in writing of any damage, claim, loss, liability or expense or
other matter which the Indemnitee has determined has given or could give rise to
a claim for which indemnification rights are granted hereunder (such written
notice referred to as the "Notice of Claim"). The Notice of Claim shall specify,
in all reasonable detail, the nature and estimated amount of any such claim
giving rise to a right of indemnification, to the extent the same can reasonably
be estimated. Any failure on the part of an Indemnitee to give timely notice to
the Indemnitor of a claim shall not affect the right of the Indemnitee to obtain
indemnification from the Indemnitor with respect to such claim unless the
Indemnitor is actually harmed by such failure to notify, and, in such case, only
to the extent of such actual harm.
(b) With respect to any matter set forth in a Notice of Claim relating to a
third party claim the Indemnitor shall defend, in good faith and at its expense,
any such claim or demand, and the Indemnitee, at its expense, shall have the
right to participate in the defense of any such third party claim. So long as
Indemnitor is defending, in good faith, any such third party claim, the
Indemnitee shall not settle or compromise such third party claim. The Indemnitee
shall make available to the Indemnitor or its representatives all records and
other materials reasonably required by them for use in contesting any third
party claim and shall cooperate fully with the Indemnitor in the defense of all
such claims. If the Indemnitor does not defend any such third party claim or if
the Indemnitor does not provide the Indemnitee with prompt and reasonable
assurances that the Indemnitor will satisfy the third party claim, the
Indemnitee may, at its option, elect to defend any such third party claim, at
the Indemnitor's expense, but subject to the Indemnitor's right to assume such
defense from the Indemnitee at any time. An Indemnitor may not settle or
compromise any claim without obtaining a full and unconditional release of the
Indemnitee, unless the Indemnitee consents in writing to such settlement or
compromise.
10.4 Exclusivity. After the Closing, to the extent permitted by Law, the
indemnities set forth in this Article X shall be the exclusive remedies of
Servatron, ITRON and their respective officers, directors, employees, agents and
Affiliates for any misrepresentation, breach of warranty or nonfulfillment or
failure to be performed of any covenant or agreement contained in this
Agreement, and the parties shall not be entitled to a rescission of this
Agreement or to any further indemnification rights or claims of any nature
whatsoever in respect thereof, all of which the parties hereto hereby waive.
ARTICLE XI
TERMINATION
11.1 Termination. This Agreement may be terminated, and the transactions
contemplated hereby may be abandoned:
(a) at any time before the Closing, by mutual written agreement of ITRON and
Servatron;
(b) at any time before the Closing, by ITRON or Servatron, in the event (i) of a
material breach hereof by the non-terminating party if such non-terminating
party fails to cure such breach within five (5) Business Days following
notification thereof by the terminating party or (ii) upon notification of the
non-terminating party by the terminating party that the satisfaction of any
condition to the terminating party's obligations under this Agreement becomes
impossible or impracticable with the use of commercially reasonable efforts if
the failure of such condition to be satisfied is not caused by a breach hereof
by the terminating party; or
(c) at any time after June 30, 2000 (the "Termination Date") by ITRON or
Servatron upon notification of the non-terminating party by the terminating
party if the Closing shall not have occurred on or before such date and such
failure to consummate is not caused by a breach of this Agreement by the
terminating party.
11.2 Effect of Termination. If this Agreement is validly terminated pursuant to
Section 11.1, this Agreement will forthwith become null and void, and there will
be no liability or obligation on the part of ITRON or Servatron (or any of their
respective officers, directors, employees, agents or other representatives or
Affiliates), except as provided in the next succeeding sentence. Notwithstanding
any other provision in this Agreement to the contrary, upon termination of this
Agreement pursuant to Section 11.1(b) or (c), ITRON will remain liable to
Servatron for any breach of this Agreement by ITRON existing at the time of such
termination, and Servatron will remain liable to ITRON for any breach of this
Agreement by Servatron existing at the time of such termination, and ITRON or
Servatron may seek such remedies, including damages and fees of attorneys,
against the other with respect to any such breach as are provided in this
Agreement or as are otherwise available at Law or in equity.
ARTICLE XII
DEFINITIONS
12.1 Defined Terms.
(a) Defined Terms. As used in this Agreement, the following defined
terms have the meanings indicated below:
"AAA" has the meaning ascribed to it in Section 13.11.
"Actions or Proceedings" means any action, suit, proceeding,
arbitration or Governmental or Regulatory Authority investigation or audit.
"Affiliate" means any Person that directly, or indirectly
through one of more intermediaries, controls or is controlled by or is under
common control with the Person specified. For purposes of this definition,
control of a Person means the power, direct or indirect, to direct or cause the
direction of the management and policies of such Person whether by contract or
otherwise and, in any event and without limitation of the previous sentence, any
Person owning ten percent (10%) or more of the voting securities of another
Person shall be deemed to control that Person.
"Agreement" means this Contribution Agreement and the
Exhibits, the Disclosure Schedule and the Schedules hereto and the certificates
delivered in accordance with Sections 6.3 and 7.3, as the same shall be amended
from time to time.
"Assets" has the meaning ascribed to it in Section 1.1.
"Assignment Instruments" has the meaning ascribed to it in
Section 1.5.
"Books and Records" of any Person means all files, documents,
instruments, papers, books and records relating to the business, operations,
condition of (financial or other), results of operations and Assets of such
Person, including, without limitation, financial statements, Tax Returns and
related work papers and letters from accountants, budgets, pricing guidelines,
ledgers, journals, deeds, title policies, minute books, stock certificates and
books, stock transfer ledgers, contracts, customer lists, computer files and
programs, retrieval programs, operating data and plans and environmental studies
and plans.
"Business Day" means a day other than Saturday, Sunday or any
day on which banks located in the State of Washington are authorized or
obligated to close.
"Closing" means the closing of the transactions contemplated
by Section 1.5.
"Closing Date" means the date specified in Section 1.5.
"Code" means the Internal Revenue Code of 1986, as amended,
and the rules and regulations promulgated thereunder.
"Condition of the Assets" means the business, condition
(financial or otherwise), results of operations, and Assets.
"Disclosure Schedule" means the record delivered by the
parties and dated as of the date hereof, containing all lists, descriptions,
exceptions and other information and materials as are required to be included
therein by Servatron and ITRON pursuant to this Agreement.
"Employee" means each employee or officer of ITRON primarily
engaged in the conduct of the business dependent upon the Assets.
"Environmental Law" means all applicable federal, state and
local laws, statutes, ordinances and regulations, and any applicable judicial or
administrative interpretation, order, consent decree or judgment, relating to
the regulation and protection of the environment. Environmental Laws include but
are not limited to the Comprehensive Environmental Response, Compensation, and
Liability Act of 1980, as amended (42 U.S.C. ss. 9601 et seq.); the Hazardous
Material Transportation Act, as amended (49 U.S.C. ss. 180 et seq.); the Federal
Insecticide, Fungicide, and Rodenticide Act, as amended (7 U.S.C. ss. 136 et
seq.); the Resource Conservation and Recovery Act, as amended (42 U.S.C. ss.
6901 et seq.); the Toxic Substance Control Act, as amended (42 U.S.C. ss. 7401
et seq.); the Clean Air Act, as amended (42 U.S.C. ss. 740 et seq.); the Federal
Water Pollution Control Act, as amended (33 U.S.C. ss. 1251 et seq.); and the
Safe Drinking Water Act, as amended (42 U.S.C. ss. 300f et seq.); and their
state and local counterparts or equivalents and any applicable transfer of
ownership notification or approval statutes.
"GAAP" means generally accepted accounting principles,
consistently applied throughout the specified period and in the immediately
prior comparable period.
"Governmental or Regulatory Authority" means any court,
tribunal, arbitrator, authority, agency, commission, official or other
instrumentality of the United States, any foreign country or any domestic or
foreign state, county, city or other political subdivision.
"Indebtedness" of any Person means all obligations of such
Person (i) for borrowed money, (ii) evidenced by notes, bonds, debentures or
similar instruments, (iii) for the deferred purchase price of goods or services
(other than trade payables or accruals incurred in the ordinary course of
business), (iv) under capital leases and (v) in the nature of guarantees of the
obligations described in clauses (i) through (iv) above of any other Person.
"Indemnified Party" means a Servatron Indemnified Party or a
ITRON Indemnified Party.
"Indemnitee" has the meaning ascribed to it in Section 10.3.
"Indemnitor" has the meaning ascribed to it in Section 10.3.
"Intellectual Property" means all patents and patent rights,
trademarks and trademark rights, trade names and trade name rights, service
marks and service xxxx rights, service names and service name rights, brand
names, inventions, processes, formulae, copyrights and copyright rights, trade
dress, business and product names, logos, slogans, trade secrets, industrial
models, processes, designs, methodologies, Software and other computer programs
(including all source codes) and related documentation, research products,
technical information, manufacturing, engineering and technical drawings,
know-how and all pending applications for and registrations of patents,
trademarks, service marks and copyrights.
"IRS" means the United States Internal Revenue Service.
"ITRON" has the meaning ascribed to it in the forepart of this
Agreement.
"ITRON Indemnified Parties" means Servatron and its respective
officers, directors, employees, agents and Affiliates.
"ITRON Material Adverse Effect" means any event, occurrence,
fact, condition, change or effect that is materially financially adverse to the
business, operations, results of operations, condition (financial or otherwise),
prospects, properties (including intangible properties), assets (including
intangible assets) or liabilities of ITRON.
"Knowledge of Servatron" or "Known to Servatron" means the
knowledge of any officer, director or key employees of Servatron.
"Knowledge of ITRON" or "Known to ITRON" means the knowledge
of any officer, director or key employee of ITRON.
"Laws" means all laws, statutes, rules, regulations,
ordinances and other pronouncements having the effect of law of the United
States, any foreign country or any domestic or foreign state, county, city or
other political subdivision or of any Governmental or Regulatory Authority.
"Liabilities" means all Indebtedness, obligations and other
liabilities of a Person (whether absolute, accrued, contingent, fixed or
otherwise, or whether due or to become due).
"Licenses" means all licenses, permits, certificates of
authority, authorizations, approvals, registrations, franchises and similar
consents granted or issued by any Governmental or Regulatory Authority.
"Liens" means any mortgage, pledge, assessment, security
interest, lease, lien, adverse claim, levy, charge or other encumbrance of any
kind, or any conditional sale contract, title retention contract or other
contract to give any of the foregoing.
"Loss" means any and all damages, fines, fees, penalties,
deficiencies, losses and expenses (including, without limitation, interest,
court costs, fees of attorneys, accountants and other experts or other expenses
of litigation or other proceedings or of any claim, default or assessment).
"Manufacturing Agreement" means the Manufacturing Agreement
between Servatron, Inc. and ITRON, Inc. dated May 15, 2000.
"Notice of Claim" has the meaning ascribed to it in
Section 10.3.
"Operative Agreements" means, collectively, the Xxxx of Sale
and the other Assignment Instruments, the Shareholders' Agreement, the
Manufacturing Agreement, the Depot Repair Services Agreement and any support or
other agreements to be entered into in connection with this transaction.
"Order" means any writ, judgment, decree, injunction or
similar order of any Governmental or Regulatory Authority (in each such case
whether preliminary or final).
"Permit" means any permit, approval, authorization, license,
variance or permission required from a Governmental Authority under an
applicable governmental rule.
"Permitted Lien" means (i) any Lien for Taxes not yet due or
delinquent or being contested in good faith by appropriate proceedings for which
adequate reserves have been established in accordance with GAAP, (ii) any
statutory Lien arising in the ordinary course of business by operation of Law
with respect to a Liability that is not yet due or delinquent and (iii) any
minor imperfection of title or similar Lien which individually or in the
aggregate with other such Liens does not materially impair the value of the
property subject to such Lien.
"Person" means any natural person, corporation, general
partnership, limited partnership, limited liability company, proprietorship,
other business organization, trust, union, association or Governmental or
Regulatory Authority.
"Purchase Price" has the meaning ascribed to it in
Section 1.3(a).
"Release" means, as to any Person, any unpermitted spill,
emission, leaking, pumping, injection, deposit, disposal, discharge, dispersal,
leaching or migration of a Contaminant into the environment.
"Remedial Action" means all actions required to clean up,
remove, prevent or minimize a Release or threat of Release or to perform
pre-remedial studies and investigations and post-remedial monitoring and care.
"Servatron" has the meaning ascribed to it in the forepart of
this Agreement.
"Servatron Indemnified Parties" means ITRON and its respective
officers, directors, employees, agents and Affiliates.
"Servatron Preferred Stock" has the meaning ascribed to it in
Section 1.3(a).
"Servatron Material Adverse Effect" means any event,
occurrence, fact, condition, change or effect that is materially adverse to the
business, operations, results of operations, condition (financial or otherwise),
prospects, properties (including intangible properties), assets (including
intangible assets) or liabilities of Servatron.
"Shareholders" mean all the holders of capital stock of ITRON.
"Shareholders' Agreement" has the meaning ascribed to it in
Section 6.7.
"Tax Returns" means any return (including any information
return), report, statement, declaration, estimate, schedule, notice,
notification, form, election, certificate or other document or information filed
with or submitted to, or required to be filed with or submitted to, any
Governmental Body in connection with the determination, assessment, collection
or payment of any Tax or in connection with the administration, implementation
or enforcement of or compliance with any Legal Requirement relating to any Tax.
"Taxes" means any tax (including any income tax, franchise
tax, capital gains tax, gross receipts tax, value-added tax, surtax, excise tax,
ad valorem tax, transfer tax, stamp tax, sales tax, use tax, property tax,
business tax, withholding tax or payroll tax), levy, assessment, tariff, duty
(including any customs duty), deficiency or fee, and any related charge or
amount (including any fine, penalty or interest), imposed, assessed or collected
by or under the authority of any Governmental or Regulatory Authority.
"Termination Date" has the meaning ascribed to it in
Section 11.1(c).
12.2 Construction of Certain Terms and Phrases. Unless the context of this
Agreement otherwise requires, (i) words of any gender include each other gender;
(ii) words using the singular or plural number also include the plural or
singular number, respectively; (iii) the terms "hereof," "herein," "hereby" and
derivative or similar words refer to this entire Agreement; (iv) the terms
"Article" or "Section" refer to the specified Article or Section of this
Agreement; and (v) the phrases "ordinary course of business" and "ordinary
course of business consistent with past practice" refer to the business and
practice of ITRON in connection with the business. Whenever this Agreement
refers to a number of days, such number shall refer to calendar days unless
Business Days are specified. All accounting terms used herein and not expressly
defined herein shall have the meanings given to them under GAAP.
ARTICLE XIII
MISCELLANEOUS
13.1 Notices. All notices, requests and other communications hereunder must be
in writing and will be deemed to have been duly given only if delivered
personally or by facsimile transmission or mailed (first class postage prepaid)
to the parties at the following addresses or facsimile numbers:
If to Servatron, to:
Servatron, Inc.
East 00000 Xxxxxxxx Xxxxxx
Xxxxxxx, XX 00000
(000) 000-0000
Facsimile No.: (000) 000-0000
Attn: Xxxxx Xxxxxxxxx (000) 000-0000
with a copy to:
Xxxxxx & Xxxx PC
0000 Xxxxx Xxxxxx, 00xx Xxxxx
Xxxxxxx, XX 00000
Facsimile No.: (000) 000-0000
Attn: Xxxxxxx Xxxxxxxx, Esq.
If to ITRON, to:
ITRON, Inc.
0000 Xxxxx Xxxxxxxx Xxxx
Xxxxxxx, XX 00000
Facsimile No.: (000) 000-0000
Attn: Chief Executive Officer
All such notices, requests and other communications will (i) if delivered
personally to the address as provided in this Section, be deemed given upon
delivery, (ii) if delivered by facsimile transmission to the facsimile number as
provided in this Section, be deemed given upon receipt, and (iii) if delivered
by mail in the manner described above to the address as provided in this
Section, be deemed given upon receipt (in each case regardless of whether such
notice, request or other communication is received by any other Person to whom a
copy of such notice, request or other communication is to be delivered pursuant
to this Section). Any party from time to time may change its address, facsimile
number or other information for the purpose of notices to that party by giving
notice specifying such change to the other party hereto.
13.2 Entire Agreement. This Agreement and the Operative Agreements supersede all
prior discussions and agreements between the parties with respect to the subject
matter hereof and thereof, including, without limitation, that certain letter of
intent dated March 15, 2000, and contain the sole and entire agreement between
the parties hereto with respect to the subject matter hereof and thereof.
13.3 Expenses. Except as otherwise expressly provided in this Agreement
(including, without limitation, as provided in Section 11.2), whether or not the
transactions contemplated hereby are consummated, each party will pay its own
costs and expenses incurred in connection with the negotiation, execution and
closing of this Agreement and the Operative Agreements and the transactions
contemplated hereby and thereby.
13.4 Public Announcements. At all times at or before the Closing, ITRON and
Servatron will not issue or make any reports, statements or releases to the
public or generally to the employees, customers, suppliers or other Persons to
whom ITRON sells goods or provides services in connection with the Assets or
with whom ITRON otherwise has significant business relationships in connection
with the Assets with respect to this Agreement or the transactions contemplated
hereby without the consent of the other, which consent shall not be unreasonably
withheld. If either party is unable to obtain the approval of its public report,
statement or release from the other party and such report, statement or release
is, in the opinion of legal counsel to such party, required by Law in order to
discharge such party's disclosure obligations, then such party may make or issue
the legally required report, statement or release and promptly furnish the other
party with a copy thereof. ITRON and Servatron will also obtain the other
party's prior approval of any press release to be issued immediately following
the Closing announcing the consummation of the transactions contemplated by this
Agreement.
13.5 Confidentiality. Each party hereto will hold, and will use its best efforts
to cause its Affiliates, and their respective Representatives to hold, in strict
confidence from any Person (other than any such Affiliate), unless (a) compelled
to disclose by judicial or administrative process (including, without
limitation, in connection with obtaining the necessary approvals of this
Agreement and the transactions contemplated hereby of Governmental or Regulatory
Authorities) or by other requirements of Law or (b) disclosed in an Action or
Proceeding brought by a party hereto in pursuit of its rights or in the exercise
of its remedies hereunder, all documents and information concerning the other
party or any of its Affiliates furnished to it by the other party or such other
party's Representatives in connection with this Agreement or the transactions
contemplated hereby, except to the extent that such documents or information can
be shown to have been (i) previously known by the party receiving such documents
or information, (ii) in the public domain (either prior to or after the
furnishing of such documents or information hereunder) through no fault of such
receiving party or (iii) later acquired by the receiving party from another
source if the receiving party is not aware that such source is under an
obligation to another party hereto to keep such documents and information
confidential; provided that following the Closing the foregoing restrictions
will not apply to Servatron's use of documents and information concerning the
Assets furnished by ITRON hereunder.
13.6 Waiver. Any term or condition of this Agreement may be waived at any time
by the party that is entitled to the benefit thereof, but no such waiver shall
be effective unless set forth in a written instrument duly executed by or on
behalf of the party waiving such term or condition. No waiver by any party of
any term or condition of this Agreement, in any one or more instances, shall be
deemed to be or construed as a waiver of the same or any other term or condition
of this Agreement on any future occasion. All remedies, either under this
Agreement or by Law or otherwise afforded, will be cumulative and not
alternative.
13.7 Amendment. This Agreement may be amended, supplemented or modified only by
a written instrument duly executed by or on behalf of each party hereto.
13.8 No Third Party Beneficiary. The terms and provisions of this Agreement are
intended solely for the benefit of each party hereto and their respective
successors or permitted assigns, and it is not the intention of the parties to
confer third-party beneficiary rights upon any other Person other than any
Person entitled to indemnity under Article X.
13.9 No Assignment; Binding Effect. Neither this Agreement nor any right,
interest or obligation hereunder may be assigned by any party hereto without the
prior written consent of the other party hereto and any attempt to do so will be
void, except (a) for assignments and transfers by operation of Law and (b) that
Servatron may assign any or all of its rights, interests and obligations
hereunder (including, without limitation, its rights under Article X) to (i) a
wholly-owned subsidiary, provided that any such subsidiary agrees in writing to
be bound by all of the terms, conditions and provisions contained herein, but no
such assignment shall relieve Servatron of its obligations hereunder. Subject to
the preceding sentence, this Agreement is binding upon, inures to the benefit of
and is enforceable by the parties hereto and their respective successors and
assigns.
13.10 Headings. The headings used in this Agreement have been inserted for
convenience of reference only and do not define or limit the provisions hereof.
13.11 Arbitration. Any controversy or claim arising out of or relating to this
Agreement shall be submitted to and be finally resolved by arbitration, pursuant
to the provisions of the United States Arbitration Act (9 U.S.C. ss. 1 et seq.),
to be conducted by an arbitration service mutually agreed upon by the parties,
with such arbitration to be held in Spokane, Washington in accordance with the
American Arbitration Association's ("AAA") Commercial Arbitration Rules then in
effect. If the parties cannot agree upon the arbitration service to conduct the
arbitration in Spokane, then the arbitration shall be conducted by Judicial
Dispute Resolution, LLC, and shall be held in Seattle, Washington. If the amount
in controversy is less than $500,000, the arbitration shall be conducted by a
single arbitrator; if the amount in controversy is $500,000 or more, the
arbitration shall be conducted by a panel of three arbitrators. The
arbitrator(s) shall be selected by mutual agreement of the parties. If the
parties cannot agree on the selection of the arbitrator(s) then the
arbitrator(s) shall be chosen by Judicial Dispute Resolution, LLC. Each party
hereby irrevocably agrees that service of process, summons, notices or other
communications related to the arbitration procedure shall be deemed served and
accepted by the other party if given in accordance with Section 13.1 of this
Agreement. The arbitrator(s) shall render a judgment of default against any
party who fails to appear in a properly noticed arbitration proceeding. Any
award or decision rendered in such arbitration shall be final and binding on
both parties, and judgment may be entered thereon in any court of competent
jurisdiction if necessary; provided, however, that the arbitrators' decision is
subject to judicial review as provided by applicable law. Either party may apply
for and obtain from any court of competent jurisdiction relief in the nature of
temporary interlocutory relief, provided such party simultaneously submits the
matter in controversy to arbitration for final resolution of the merits of such
controversy or claim pursuant to this Section 13.11.
13.12 Invalid Provisions. If any provision of this Agreement is held to be
illegal, invalid or unenforceable under any present or future Law, and if the
rights or obligations of any party hereto under this Agreement will not be
materially and adversely affected thereby, (a) such provision will be fully
severable, (b) this Agreement will be construed and enforced as if such illegal,
invalid or unenforceable provision had never comprised a part hereof, (c) the
remaining provisions of this Agreement will remain in full force and effect and
will not be affected by the illegal, invalid or unenforceable provision or by
its severance here from and (d) in lieu of such illegal, invalid or
unenforceable provision, there will be added automatically as a part of this
Agreement a legal, valid and enforceable provision as similar in terms to such
illegal, invalid or unenforceable provision as may be possible.
13.13 Governing Law. This Agreement shall be governed by and construed in
accordance with the Laws of the State of Washington applicable to a contract
executed and performed in such State, without giving effect to the conflicts of
laws principles thereof. This Agreement shall be governed by, and construed in
accordance with, the laws of the State of Washington without reference to its
choice of law rules. The parties hereby irrevocably consent to exclusive
personal jurisdiction and venue in the state and federal courts located in
Spokane County, Washington with respect to any actions, claims or proceedings
arising out of or in connection with this Agreement, and agree not to commence
or prosecute any such action, claim or proceeding other than in the
aforementioned courts.
13.14 Remedies. With respect to the obligations of Section 2.9 hereof, each of
the parties expressly acknowledges and agrees that the other party would be
damaged irreparably in the event that any of the provisions of this Agreement
are not performed in accordance with their specific terms or otherwise are
breached. Accordingly, each of the parties hereto agrees that the other party
shall be entitled to an injunction to prevent breaches of the provisions of this
Agreement and to enforce specifically this Agreement and the terms and
provisions hereof in any court of competent jurisdiction, in addition to any
other remedy to which they may be entitled at law or in equity.
13.15 Attorneys' Fees. The prevailing party in any arbitration, legal or
equitable proceedings brought hereunder will be awarded reasonable attorneys'
fees, expert witness costs and expenses, and all other costs and expenses
incurred directly or indirectly in connection with such proceeding.
13.16 Counterparts. This Agreement may be executed in any number of
counterparts, each of which will be deemed an original, but all of which
together will constitute one and the same instrument.
PURCHASER: ITRON:
Servatron, Inc., a Washington ITRON, Inc., a Washington corporation
corporation
By: ________________________ By: ____________________
/s/Xxxxx Xxxxxxxxx /s/Xxxxxx Xxxxxxx
President COO
