ASSET PURCHASE AGREEMENT
EXHIBIT
10.6
ASSET
PURCHASE AGREEMENT (this "Agreement"),
dated
as of April 17, 2007, between Alliance Systems, Ltd., a Texas limited
partnership ("Seller"),
and
Interactive Intelligence, Inc., an Indiana corporation ("Buyer").
RECITALS
A. Seller
is
in the business of providing hardware, including servers and gateways, for
Buyer
and other companies. Seller also provides software support and professional
services through a focused professional services group for Buyer and other
companies, including, but not limited to, software sales, software
implementations and configurations (the "PSO
Business").
B. Seller
desires to sell to Buyer substantially all of the assets of the PSO Business,
and Buyer desires to purchase those assets from Seller, upon the terms and
subject to the conditions set forth in this Agreement.
NOW,
THEREFORE, in consideration of the premises and the representations, warranties,
covenants and agreements contained herein, the parties hereby agree as
follows:
ARTICLE
1
Sale
and Purchase of Assets
1.1. Sale
and Purchase of Assets.
Upon
the terms and subject to the conditions set forth in this Agreement, on the
Closing Date (as defined in Article
2.2
below),
Seller agrees to sell, transfer, convey, assign and deliver to Buyer, and Buyer
agrees to purchase, acquire, assume and accept from Seller, all of Seller's
right, title and interest in and to the following assets of Seller
(collectively, the "Assets"):
(a) Certain
Contract Rights.
All of
Seller's rights under the services and support contracts listed on Exhibit
A
attached
hereto (collectively, the "Services
and Support Contracts").
Some
of the Services and Support Contracts are proposed contracts and are identified
as such on Exhibit
A.
(b) Other
Contracts.
All of
Seller's rights and obligations under other contracts listed on Exhibit
B
attached
hereto (collectively, the "Other
Contracts"
and,
collectively with the software Services and Support Contracts, the "Assumed
Contracts").
(c) Equipment.
All of
Sellers tangible assets related to and used in or useful for the PSO Business,
including, but not limited to, furniture, fixtures, computers, hardware,
software, manuals, training materials and other equipment listed on Exhibit
C
attached
hereto (collectively, the "Equipment").
(d) Books
and Records.
All
books and records relating to the Assumed Contracts and the other Assets
including customer lists and records, mailing lists, marketing, sales and
promotional materials and records, and all other books, records, files, data
or
databases, correspondence, memoranda, notes and other documents or papers and
other evidence thereof relating to the PSO Business (collectively, the
"Books
and Records").
(e) Intangible
Assets.
All
know-how, processes, goodwill and other intangible assets associated with the
PSO Business.
1.2. Assumption
of Certain Liabilities by Buyer.
(a) Assumed
Liabilities.
Upon
the terms and subject to the conditions set forth in this Agreement, on the
Closing Date, Buyer agrees to assume only those liabilities and obligations
arising out of Buyer's ownership and operation of the PSO Business from and
after the Closing Date (and in particular, with respect to obligations under
the
Assumed Contracts, only the obligations thereunder that are required pursuant
to
the Assumed Contracts to be performed after the Closing Date) (collectively,
the
"Assumed
Liabilities").
(b) Retained
Liabilities.
Except
as specifically set forth in subsection
(a)
above,
Buyer will not assume any debts, obligations, rent, taxes, operating expenses,
utilities or other liabilities of Seller of any character whatsoever, whether
accrued, contingent or otherwise (the "Retained
Liabilities").
All
of the foregoing will be retained by Seller and Seller agrees to pay and satisfy
when due any such liabilities and obligations not assumed by Buyer. Seller
hereby acknowledges and agrees that Buyer shall not have any liability,
obligation or responsibility for any breach of any of the Assumed Contracts
prior to the Closing Date. Without limitation of the foregoing, Buyer will
not
assume (i) any accounts payable or debts, whether owed to banks, officers,
shareholders, affiliates or other creditors of any nature whatsoever, (ii)
any
employment agreements, employee benefit plans or other employment related
contracts or obligations except those obligations agreed upon in Article
5.5,
or
(iii) any obligations under any Contracts (as hereinafter defined) of Seller
that are not Assumed Contracts.
ARTICLE
2
Purchase
Price; Closing
2.1. Purchase
Price.
The
aggregate purchase price for the Assets will be One Million, One Hundred
Thousand Dollars ($1,100,000) payable as set forth in Article
2.4
(the
"Purchase
Price").
2.2. Closing.
Upon
the terms and subject to the conditions set forth in this Agreement, the closing
of the sale and purchase of the Assets (the "Closing")
shall
take place at the offices of Buyer's counsel, Xxxxx & Xxxxxxx LLP, in
Indianapolis, Indiana, simultaneously with the execution and delivery of this
Agreement, or at such other place and time and/or on such other date as the
parties hereto may mutually agree. The date and time at which the Closing
actually occurs is referred to herein as the "Closing
Date."
2.3. Closing
Matters.
Upon
the terms and subject to the conditions set forth in this Agreement, at the
Closing:
(a) Buyer
shall deliver to Seller the Purchase Price (as adjusted as set forth in
Article
2.4
below,
and minus the Hold Back Sum referred to in Article
2.5
below),
by wire transfer of immediately available funds in such amount to an account
to
be designated in writing by Seller prior to the Closing Date.
(b) Seller
shall deliver to Buyer such bills of sale, endorsements, assignments and other
good and sufficient instruments of conveyance and transfer, in form and
substance reasonably satisfactory to Buyer, as shall be effective to vest in
Buyer all of Seller's right, title and interest in and to the Assets and,
simultaneously therewith, will take such steps as may be necessary to place
Buyer in actual possession and operating control of the Assets. Delivery of
the
Equipment shall be made at its current locations.
(c) Seller
shall deliver to Buyer any required executed consents to assignments received
by
Seller with respect to the Assumed Contracts, which consents to assignment
shall
be in form and substance reasonably satisfactory to Seller and
Buyer.
(d) Buyer
shall deliver to Seller such written undertakings, in form and substance
reasonably satisfactory to Seller, whereby Buyer shall assume and agree to
perform the Assumed Liabilities.
(e) Seller
and Buyer shall deliver to each other such other documents, certificates,
instruments and writings required to be delivered pursuant to this
Agreement.
2.4. Adjustments
and Prorations.
The
amount payable at the Closing (the "Closing
Payment")
shall
be subject to adjustment as follows:
(a) The
Closing Payment will be decreased by the amount of all payments previously
received by Seller prior to the Closing Date under the Services and Support
Contracts as advance payments for services to be performed by Buyer after the
Closing Date under such Assumed Contracts (including, without limitation,
prorated amounts paid by Buyer to Seller for annual support services with
respect to that portion of each contract year after the Closing
Date).
(b) The
Closing Payment will be increased by the amount which, pursuant to the Services
and Support Contracts, is to be billed to customers after the Closing Date
for
services that were previously performed by Seller prior to the Closing Date.
Buyer shall have the right to xxxx and collect such amounts after the Closing
Date. Notwithstanding the foregoing, Buyer is not purchasing or assuming
Seller's accounts receivable that are outstanding at the Closing Date and there
will be no adjustment of the Closing Payment as a result of such
receivables.
(c) The
parties will cooperate and use their good faith efforts document and agree
upon
the prorations required by this Article
2.4
at least
two business days prior to the Closing. If final prorations cannot be made
prior
to or at the Closing, then the parties shall allocate such items on a fair
and
equitable basis as soon as the applicable invoices, bills or other financial
statements are available, with final adjustment to be made as soon as reasonably
possible after the Closing Date. Each party promptly will provide the other
upon
reasonable request with all financial information in its possession or control
in reasonable detail necessary to determine and confirm the final
prorations.
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2.5. Hold
Back Provision.
(a) Both
Seller and Buyer recognize that there are no guarantees that the PSO Employees
(as defined herein) will stay in the employment of the Buyer nor any legal
obligation the PSO Employees will stay in the employment of the Buyer after
the
Closing Date, unless Buyer enters into binding employment agreements with such
employees. Absent such employment agreement, the PSO Employees have a right
to
leave their employment at will. The Seller and Buyer recognize that if any
of
the PSO Employees leave the employment of the Buyer during a short period of
time after the Closing Date, there may be certain costs of recruiting and
training that the Buyer could incur. The Seller and Buyer agree that Buyer
shall
hold back from the amount to be paid to Seller at the Closing the sum of One
Hundred and Eighty Thousand ($180,000.00) Dollars (the "Hold
Back Sum")
for a
period of ninety days to account for the costs of recruiting and training if
any
of the PSO Employees leave the employment of Buyer prior to the date that is
ninety days after the Closing Date (such date being the "Final
Settlement Date").
The
Hold
Back
Sum
will be
paid in full to the Seller so long as none of the PSO Employees leave the
employment of the Buyer prior to the Final Settlement Date. The Hold Back Sum
to
be paid to the Seller will be reduced by a certain sum depending upon which
PSO
Employee leaves prior to the Final Settlement Date. A list of the PSO Employees
is set out on the attached Exhibit
D
which
includes the sum of money identified as a reduction in the Hold Back Sum that
will be paid to the Seller on the Final Settlement Date. Such reductions will
be
returned to the Buyer at the Final Settlement Date.
(b) At
the
Final Settlement Date, the parties mutually agree to the following process:
The
Buyer will provide the Seller (i) the final list of those PSO Employees that
have remained in the employment of the Buyer at the Final Settlement Date;
(ii)
a final accounting of the Hold Back Sum owed the Seller, less any deductions
for
PSO Employees that have left before the Final Settlement Date, and (iii) written
confirmation that the Buyer will to pay the Seller the Hold Back Sum less any
deductions to the Hold Back Sum returned to the Buyer at the Final Settlement
Date. The Buyer will review such information, and confirm its acceptance of
the
final Hold Back Sum before the monies will be paid to each party.
2.6. Allocation
of Purchase Price.
At or
prior to the Closing, Seller and Buyer shall agree in writing to an allocation
of the Purchase Price among the various Assets. Each of Seller and Buyer agrees
that it shall report for federal, state, local and all other tax purposes in
a
manner consistent with such allocation, and that it shall not take any position
inconsistent with such allocation in connection with any examination, claim,
action or other proceeding by or against any taxing authority or for any other
purpose.
ARTICLE
3
Representations
and Warranties of Seller
Seller
hereby represents and warrants to Buyer as follows:
3.1. Organization
and Authority.
Seller
is duly organized and validly existing as a limited partnership under the laws
of the State of Texas and has the requisite corporate power and authority to
enter into this Agreement and to perform its obligations hereunder. This
Agreement has been duly authorized, executed and delivered by Seller and
constitutes a valid and legally binding obligation of Seller, enforceable
against Seller in accordance with its terms.
3.2. No
Violation.
The
execution, delivery and performance of this Agreement by Seller do not and
will
not constitute or result in (i) a breach or violation of the Articles of
Incorporation or By-Laws of Seller, or (ii) a breach or violation of, a default
under, the acceleration of or the creation of any Lien (as hereinafter defined)
(with or without the giving of notice or the lapse of time) pursuant to, any
provision of any agreement, lease, license, contract, note, mortgage,
arrangement or other obligation (collectively, "Contracts")
to
which Seller is a party or by which it or any of the Assets is bound, or any
law, rule, ordinance or regulation or any judgment, decree, order, award or
governmental or non-governmental permit to which it is subject.
3.3. Required
Consents.
Except
as set forth on Schedule
3.3,
no
notices, reports or other filings are required to be made by Seller with, and
no
consents, approvals or other authorizations are required to be obtained by
Seller from any governmental or regulatory authority or any other person in
connection with the execution, delivery and performance of this
Agreement.
3.4. Warranty
of Title.
Except
as set forth on Schedule
3.4,
Seller
owns all right, title and interest in and to all of the Assets, free and clear
of all liens, pledges, security interests, claims, charges or other encumbrances
of any nature whatsoever ("Liens"),
all
of which Liens will be completely released on or prior to the Closing Date.
At
the Closing, Seller will convey to Buyer, and Buyer will take from Seller,
all
right, title and interest in and to all of the Assets, free and clear of any
and
all Liens.
3.5. Assumed
Contracts.
The
Assumed Contracts comprise all of the material Contracts related to the PSO
Business. Seller has delivered to Buyer true and accurate copies of all of
the
Assumed Contracts, as amended through the Closing Date. Each of the Assumed
Contracts is valid, binding and enforceable in accordance with its terms and
there is not any existing default or event of default, or any event which,
with
or without notice or lapse of time or both, would constitute a default under
any
of the Assumed Contracts by Seller or, to the knowledge of Seller, by any other
party thereto.
3.6. Condition
of Equipment; Sufficiency of Assets.
The
Equipment is in good operating condition and repair (subject to routine
maintenance in the ordinary course of business) and, collectively with the
Assumed Contracts and the other Assets, constitute all of the assets necessary
and sufficient for the continued conduct of the PSO Business by Buyer after
the
Closing in the same manner as conducted prior to the Closing.
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3.7. PSO
Employees.
(a) Schedule
3.7
sets
forth a complete and accurate list of all of the employees of Seller engaged
in
the PSO Business (the "PSO
Employees"),
including their name, job title, current wage rate or salary and date of hire.
Except as set forth on Schedule
3.7,
Seller
is not a party to or bound by any employment agreement, collective bargaining
agreement or other employment related Contract or arrangement with respect
to
any of the PSO employees.
(b) With
respect to the PSO Employees, Seller is in compliance in all material respects
with all applicable laws respecting employment and employment practices, terms
and conditions of employment, wages and hours of work and occupational safety
and health, including, without limitation, laws respecting employment
discrimination. There are no claims, actions or proceedings pending or, to
the
knowledge of Seller, threatened against Seller by or on behalf of any of the
PSO
Employees alleging breach of any law or regulation governing employment or
the
termination thereof or other discriminatory, wrongful or tortious conduct in
connection with the employment relationship. Seller has not received any notice
of the intent of any governmental or regulatory authority responsible for the
enforcement of labor or employment laws to conduct an investigation of Seller
and no such investigation is in progress. There is no labor strike, dispute,
slowdown, stoppage or lockout actually pending or, to Sellers' knowledge,
threatened by any of the PSO Employees.
(c) Seller
is
not delinquent in payments to any of the PSO Employees for any wages, salaries,
commissions, bonuses or other compensation for any services performed by them
to
the date hereof. Seller has complied with all withholding tax requirements
and
procedures and, in the case of social security, unemployment, employee payroll
and withholding taxes, Seller has withheld amounts from the PSO employees,
in
each case in compliance in all material respects with applicable tax withholding
provisions and has made all required remittances in respect of such amounts
withheld.
3.8. Compliance
with Law; No Litigation.
Seller
and the PSO Business are in compliance in all material respects with all
applicable laws and regulations and there is no action, suit or proceeding
pending or, to the knowledge of Seller, threatened against Seller relating
in
any way to the PSO Business or the Assets or that would affect Buyer's ownership
and control or rights to use or otherwise receive the benefit of any of the
Assets following the Closing Date.
3.9. No
Brokers.
No
broker, finder or investment banker, including any director, officer, employee,
affiliate or associate of Seller, is entitled to any brokerage, finder's or
other fee or commission in connection with the transactions contemplated by
this
Agreement based on arrangements made by or on behalf of Seller or any of its
affiliates.
3.10. Accuracy
of Information.
All
documents and other information delivered by or on behalf of Seller to Buyer
in
connection with this Agreement and the transactions contemplated hereby is
true,
correct and complete. All financial information regarding the PSO Business
delivered by or on behalf of Seller to Buyer fairly presents in all material
respects the financial condition and the results of operations and cashflows
of
the PSO Business at the dates and for the periods presented, and that the Buyer
has had an opportunity to review such information prior to Closing. The
information furnished by or on behalf of Seller to Buyer in connection with
this
Agreement and the transactions contemplated hereby (including the
representations and warranties of Seller included herein and the Schedules
attached hereto) does not contain any untrue statement of a material fact or
omit to state any material fact; and Seller does not know of any fact, event
or
condition that has resulted in, or could reasonably be expected to result in,
a
material adverse change in the PSO Business or the condition of the
Assets.
ARTICLE
4
Representations
and Warranties of Buyer
Buyer
hereby represents and warrants to Seller as follows:
4.1. Organization.
Buyer
is duly organized and validly existing as a corporation under the laws of the
State of Indiana and has the requisite corporate power and authority to enter
into this Agreement and to perform its obligations hereunder. This Agreement
has
been duly authorized, executed and delivered by Buyer and constitutes a valid
and legally binding obligation of Buyer, enforceable against Buyer in accordance
with its terms.
4.2. No
Violation.
The
execution, delivery and performance of this Agreement by Buyer do not and will
not constitute or result in (i) a breach or violation of the Articles of
Incorporation or By-Laws of Buyer, or (i) a breach or violation of, a default
under, the acceleration of or the creation of any Lien (with or without the
giving of notice or the lapse of time) pursuant to, any provision of any
Contract to which Buyer is a party or by which it is bound.
4.3. Required
Consents.
No
notices, reports or other filings are required to be made by Buyer with, and
no
consents, approvals or other authorizations are required to be obtained by
Buyer
from, any governmental or regulatory authority or any other person in connection
with the execution, delivery and performance of this Agreement.
4.4. No
Brokers.
No
broker, finder or investment banker, including any
director, officer, employee, affiliate or associate of Seller, is entitled
to
any brokerage, finder's or other fee or commission in connection with the
transactions contemplated by this Agreement based on arrangements made by
or on
behalf of Buyer or any of its affiliates.
4.5. PSO
Employees.
Buyer
agrees that it has provided Seller for presentation to
the
PSO Employees an accurate statement of the proposed wages, salaries, bonuses,
and job titles for the PSO Employees once they become employees of the Buyer.
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ARTICLE
5
Covenants
5.1. Conduct
of Business.
Prior
to the Closing Date, except as Buyer may otherwise consent in writing, Seller
shall operate its PSO Business in the usual and ordinary course consistent
with
past practice, and Seller shall not sell, encumber or otherwise transfer any
of
the Assets.
5.2. Exclusivity.
Prior
to the Closing Date, neither Seller nor any of its shareholders, directors,
officers, employees or representatives shall enter into any agreement providing
for, or solicit, encourage or facilitate any proposal or any inquiries with
respect to, any acquisition of any of the Assets.
5.3. Cooperation;
Further Assurances.
(a) Prior
to
the Closing Date, Seller and Buyer agree to cooperate and respectively use
all
reasonable efforts to promptly obtain the consent of each counterparty to each
Assumed Contract that may be required in order to assign (or, in the case of
Service and Support Contracts that are not yet completed and executed, to
complete and execute such Assumed Contracts) and otherwise fully effect the
sale
and purchase of such Assumed Contract, and to take such actions as may be
necessary or desirable to satisfy the conditions to the Closing set forth in
this Agreement and to otherwise consummate and make effective the transactions
contemplated by this Agreement.
(b) At
any
time and from time to time after the Closing, Seller shall, at the reasonable
request of Buyer and at Seller's expense and without further consideration,
execute and deliver any bills of sale, endorsements, assignments and other
instruments of conveyance and transfer, and take such other actions as Buyer
may
reasonably request in order more effectively to transfer, convey, assign and
deliver to Buyer, and to place Buyer in actual possession and operating control
of, and to vest, perfect or confirm, of record or otherwise, in Buyer all right,
title and interest in, to and under the Assets or to otherwise carry out the
intents and purposes of this Agreement.
5.4. Books
and Records.
On the
Closing Date, Seller shall deliver to Buyer all of the Books and Records.
However, if at any time after the Closing Date, Seller or Buyer discover any
other Books and Records that have not been delivered to Buyer, Seller shall
promptly deliver them to Buyer. From and after the Closing Date, Seller shall
not, and shall cause its representatives not to, use any of the information
in
the Books and Records for any purpose unrelated to the transactions contemplated
by this Agreement, and Seller shall (and shall cause its directors, officers,
employees, affiliates, agents and other representatives to) keep all of such
information strictly confidential unless such information
(a) is
or becomes generally available to the public other than as a result of
disclosure in violation of this Article or (b) is required, in the opinion
of
legal counsel, to be disclosed by law, in which case the parties will discuss
the terms of such disclosure prior to its release.
5.5. Employee
Matters.
(a) Buyer
shall offer employment to all of the PSO Employees commencing as of the Closing
Date, but shall not have any obligation hereunder or otherwise to hire any
PSO
Employee. PSO Employees who are hired by Buyer are herein called "Hired
Employees".
Seller
shall assist Buyer in good faith in obtaining the employment of the PSO
Employees to which it makes offers, and shall terminate its employment of all
of
the Hired Employees prior to the Closing. In the event notice is required
pursuant to the provisions of the Worker Adjustment and Retraining Act (the
"WARN
Act"),
Seller shall be solely responsible for providing such notice to its employees
and Seller shall indemnify and hold Buyer harmless from any Losses (as
hereinafter defined) incurred by Buyer arising out of or based upon an assertion
of noncompliance by Seller with the provisions of the WARN Act.
(b) Seller
shall be solely responsible for and will pay to each Hired Employee all earned
wages and benefits through the Closing Date including, without limitation,
all
accrued vacation time and bonuses accrued and unpaid through the Closing Date.
Seller shall be responsible for any other liability which may exist or arise
as
a result of wage claims, benefit claims, or other employment related claims
for
any employees of any sort with respect to all periods ending on or prior to
the
Closing Date.
(c) From
and
after the Closing Date, Seller shall be solely responsible for any and all
benefit liabilities relating to or arising in connection with the requirements
of Section 4980B of the Code (COBRA) to provide continuation of health care
coverage under any employee benefit plan in respect of any of the PSO Employees
(and their dependents) who do not become Hired Employees, including, without
limitation, any liabilities arising out of the transactions contemplated hereby.
Notwithstanding the foregoing, Buyer agrees that it will waive any such waiting
period under its health care insurance plan for the Hired Employees to become
fully covered under the Buyer’s employee health care plan upon the Closing Date.
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(d) Buyer
and
Seller agree that Buyer is not assuming any liability under any benefit plans
maintained by Seller for the benefit of its employees and that Buyer shall
not
be deemed a successor company to Seller in connection with any employee benefit
plan or other employment related arrangement to which the present or former
employees of Seller are or were entitled (including any severance arrangements).
Without limitation, Buyer shall not assume, and shall have no liability
whatsoever for, any wages, salaries, bonuses, deferred compensation, pension
obligations, retirement benefits, health and welfare fund contributions,
vacation pay, sick leave, severance pay or any other compensation or employee
benefits to which the present or former employees of Seller are or were
entitled; shall have no obligation to employ any of Seller's employees in
connection with or after the transactions contemplated hereby; and shall not
be
required to assume any collective bargaining agreements or other understandings
or arrangements between Seller and any union or other person or organization
purporting to represent the former or present employees of Seller, or any
employment agreements or understandings, written or oral, between Seller and
any
of its former or present employees. Nothing herein shall confer upon any of
the
PSO Employees any rights or remedies, including any right to employment, or
continued employment for any specified period, of any nature whatsoever with
Buyer under or by reason of the Agreement. Buyer shall have the right, at any
time and in its sole discretion, to amend or terminate any benefit plan that
Buyer may make available to any Hired Employee, without the consent of any
person covered under such plan.
5.6. Covenant
Not to Compete.
(a) Seller
agrees that, for a period of three years after the Closing Date, without the
prior written consent of Buyer, neither Seller nor any affiliate of Seller
shall:
(i) directly
or indirectly, either alone or in conjunction with any other individual, entity
or other person, whether as a shareholder, partner, member, manager, joint
venturer, investor, consultant or in any other capacity whatsoever, engage
in or
be in any manner connected with any other person or entity engaged in the PSO
Business as to the sale of Buyer's software, software support and maintenance
only, anywhere within the United States of America ("Covered
Business");
provided,
that
Seller or an affiliate of Seller may own up to 1% of any class of securities
that is listed or admitted to trading on a national securities exchange or
the
Nasdaq Stock Market that is related to the Covered Business;
(ii) directly
or indirectly, either alone or in conjunction with any other individual, entity
or other person, (A) induce or attempt to induce any customer, supplier,
distributor or other business relation of Seller or Buyer as to the Covered
Business with whom Seller or Buyer has or has had relationships, directly or
indirectly, to curtail or cancel Covered Business with Buyer; (B) solicit
or canvass Covered Business from any person who is or was a customer of Seller
or Buyer as to the Covered Business at any time; or (C) otherwise in
any
way intentionally interfere with the relationship between Buyer and any of
its
customers, suppliers, distributors or other business relations;
(iii) either
alone or in conjunction with any other individual, entity or other person,
actively solicit, induce or attempt to induce any employee of Buyer to leave
the
employ of Buyer, or employ or otherwise engage the services of any employee,
or
otherwise in any way interfere with the relationship between Buyer and any
of
its employees; or
(iv) disparage
Buyer or any of its directors, officers, employees, agents or
shareholders.
(b) This
Article
5.6
shall be
binding upon any successor to Seller after the Closing Date (whether by merger,
consolidation, purchase of capital stock or purchase of all or substantially
all
assets).
(c) Seller
agrees that the terms of this Article
5.6
are
reasonable with respect to their duration, geographical area and scope, that
money damages would not be a sufficient remedy for any breach of the terms
of
this Article
5.6
and
that, in addition to all other remedies available hereunder or otherwise, Buyer
shall be entitled to equitable relief, including temporary and permanent
injunctive relief (without any requirement to post any bond or other security).
In the event of any breach of any covenant set forth in this Article
5.6,
the
term of such covenant will be extended by the period of the duration of such
breach.
(d) All
of
the covenants in this Article
5.6
shall be
construed as agreements independent of any other provision of this Agreement
or
any other agreement between the parties hereto, and the existence of any claim
or cause of action by either party hereto against the other party, whether
predicated on this Agreement or otherwise, shall not constitute a defense to
the
enforcement of this Article
5.6,
and no
material or other breach of any contractual or legal duty by either party hereto
shall be held sufficient to excuse or terminate any party's obligations under
this Article
5.6
or to
preclude Buyer from obtaining injunctive relief as aforesaid.
5.7. Support
of Seller Telephone Equipment.
Buyer
will, for a period of three (3) years after the Closing provide, at no charge
to
Seller, continued software support of, software maintenance of and free software
upgrades, including all major and minor upgrades, for Buyer's current telephone
system utilized by Seller. In addition, Buyer will provide, at no charge to
the
Seller, training courses for one (1) designated employee of Seller for internal
support of Seller’s headquarters. Such training will take place at Buyer's
location, and will commence upon a mutually agreeable schedule. Seller will
be
responsible for all of the designated employee’s travel and living expense while
being trained.
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5.8. Tustin
Lease.
After
the Closing, Seller
will permit Buyer to continue to occupy the office space that Seller
currently
leases
in Tustin, California (the "Tustin
Lease")
for
the remaining term of that lease (which expires in October 2007). On a monthly
basis, Buyer will reimburse Seller for all
amounts due under the Tustin Lease for rent and all other occupancy costs,
including telephone, electricity and other utility charges with respect to
the
Tustin offices, promptly upon receipt of an invoice from Seller setting forth
such amounts in reasonable detail. With respect to the month of April, such
amounts shall be prorated as of the Closing Date.
5.9. Publicity.
Neither
party hereto shall issue any press release or otherwise make any public
statement regarding this Agreement or the transactions contemplated hereby
without the prior written consent of the other party hereto, unless otherwise
required by applicable law.
ARTICLE
6
Conditions
6.1. Conditions
to the Obligations of Buyer.
The
obligations of Buyer to consummate the transactions contemplated hereby are
subject to the satisfaction (or waiver by Buyer), on or prior to the Closing
Date, of each of the following conditions:
(a) Compliance.
The
representations and warranties of Seller contained in this Agreement shall
be
true as of the Closing Date as though made at and as of the Closing Date and
the
covenants and agreements of Seller contained in this Agreement to be performed
on or prior to the Closing Date shall have been performed.
(b) Consents.
Any
filings required to be made by Seller with, and all consents, approvals and
authorizations required to be obtained by Seller from, any other person in
connection with the execution and delivery of this Agreement and the
consummation of the transactions contemplated by this Agreement shall have
been
made or obtained. Buyer agrees that it has worked with the Seller to facilitate
consents, if necessary, of customers being transferred to Buyer under this
Agreement.
(c) Employees.
Each of
the PSO Employees listed on Exhibit
D
shall
have accepted offers to become employed by Buyer commencing on the Closing
Date,
on terms and conditions (including Buyer's customary confidentiality and
non-competition obligations) and in form and substance reasonably satisfactory
to Buyer and Seller.
6.2. Conditions
to the Obligations of Seller.
The
obligations of Seller to consummate the transactions contemplated hereby are
subject to the satisfaction (or waiver by Seller), on or prior to the Closing
Date, of the following conditions:
(a) Compliance.
The
representations and warranties of Buyer contained in this Agreement shall be
true as of the Closing Date as though made at and as of the Closing Date and
the
covenants and agreements of Buyer contained in this Agreement to be performed
on
or prior to the Closing Date shall have been performed.
(b) Consents.
Any
filings required to be made by Buyer with, and all consents, approvals and
authorizations required to be obtained by Buyer from, any other person in
connection with the execution and delivery of this Agreement and the
consummation of the transactions contemplated by this Agreement shall have
been
made or obtained.
ARTICLE
7
Termination
7.1. Termination.
This
Agreement may be terminated and the transactions contemplated hereby abandoned
at any time prior to the Closing:
(a) by
mutual
consent of Seller and Buyer;
(b) by
either
Seller or Buyer, if the Closing does not occur on or prior to April 30, 2007,
for any reason other than a breach of this Agreement by the terminating party;
or
(c) by
either
Seller or Buyer, if there shall have been any material breach by the other
party
of any of its respective representations, warranties, covenants or agreements
set forth herein, which breach shall have, in the reasonable judgment of the
terminating party, rendered impossible the satisfaction by the other party
of
the conditions set forth in Article
6
hereof.
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7.2. Procedure
and Effect of Termination.
In the
event of termination of this Agreement pursuant to Article
7.1(b)
or
(c),
the
terminating party shall immediately give written notice of such termination
to
the other party and this Agreement shall terminate, and the transactions
contemplated hereby shall be abandoned, without further action by any of the
parties. If this Agreement is terminated as provided in this Article
7,
neither
party will have any liability or further obligation under this Agreement to
any
other party, except as provided in this Article
7.2
and
Article
8.1,
and
except that nothing herein will relieve any party from liability for any breach
of this Agreement.
ARTICLE
8
Miscellaneous
and General
8.1. Payment
of Expenses.
Whether
or not the transactions contemplated by this Agreement are consummated, each
party shall pay its own expenses incident to preparing for, entering into and
carrying out this Agreement and the transactions contemplated
hereby.
8.2. Survival;
Indemnification.
(a) The
representations and warranties of the parties set forth in Article
3
and
Article
4
of this
Agreement shall survive the Closing for a period of one year after the Closing
Date, subject to the final sentence of subsection
(b)
below.
The covenants and agreements of the parties set forth in this Agreement shall
survive the Closing for the respective periods set forth therein (and until
all
of the respective obligations set forth therein have been satisfied in full)
or,
if no period is specified therein, indefinitely. The agreements of the parties
contained in Article
7,
Article
8.1
and this
Article
8.2(a)
shall
survive any termination of this Agreement.
(b) After
the
Closing Date, Seller shall indemnify and hold Buyer, and any of Buyer's
employees, agents or representatives, harmless from and against any liability,
loss, damage, claim, cost or expense (including, without limitation, expenses
of
investigation and defense and reasonable fees and disbursements of counsel),
Liens or other obligations of any nature whatsoever (collectively, "Losses"),
incurred by any of them and arising out of or based upon (i) any breach by
Seller of its representations, warranties, covenants or agreements set forth
in
this Agreement or any other document or instrument delivered by Seller at the
Closing; (ii) any claim, action, suit, proceeding or investigation of any kind,
at law or in equity, arising from acts, omissions, events or other conditions
that occurred or existed with respect to the Assets or the PSO Business at
any
time prior to the Closing; or (iii) any Retained Liabilities. The
indemnification obligations of Seller under clause
(i)
above
with respect to its representations and warranties shall terminate on the first
anniversary of the Closing Date; provided,
however,
that
with respect to any claim for indemnification that is asserted or made on or
prior to such date, all rights to indemnification in respect of such claim
shall
continue until the final disposition of such claim; and further provided,
that
the foregoing limitations shall not apply to any Losses that may be incurred
by
Buyer by virtue of or result from any breach of the representations and
warranties set forth in Articles
3.1,
3.2,
3.3
or
3.4
or from
violations of law, fraud or intentional misrepresentation.
(c) As
promptly as practicable after its discovery of grounds for a claim for
indemnification hereunder, Buyer will deliver a written claim for
indemnification to Seller, specifying in reasonable detail the basis therefor
and, if known, the amount, or an estimate of the amount, of the Losses arising
therefrom. Thereafter, Buyer will provide to Seller all information and
documentation reasonably available to it to support and verify such claim.
If
the facts giving rise to a claim for indemnification hereunder arise out of
the
claim of any third party, or if there is any claim against a third party, Seller
may, with Buyer's consent, elect to assume the defense or the prosecution,
with
counsel satisfactory to Buyer, at the sole cost and expense of Seller. Whether
or not Seller chooses to assume the defense or prosecution of the claims, Seller
and Buyer will cooperate in the defense or prosecution thereof and will furnish
such records and information and attend at such proceedings as may be reasonably
requested in connection herewith.
8.3. Modification
or Amendment.
At any
time prior to the Closing, the parties hereto may modify or amend this
Agreement, by written agreement duly executed and delivered by each of the
parties hereto.
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8
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8.4. Notices.
All
notices and other communications given or made pursuant hereto shall be in
writing and shall be deemed to have been duly given on the date delivered,
if
delivered personally, on the fifth business day after being mailed by registered
or certified mail (postage prepaid, return receipt requested), in each case,
to
the parties at the following addresses, or on the date sent and confirmed by
electronic transmission to the facsimile number specified below (or at such
other address or facsimile number for a party as shall be specified by notice
given in accordance with this Article):
(a) If
to
Buyer, to:
Interactive
Intelligence, Inc.
0000
Xxxxxxxxxxx Xxx
Xxxxxxxxxxxx,
Xxxxxxx 00000
Attention:
Xxxxxxx X. Head
Facsimile
No.: (000) 000-0000
With
a
required copy to:
Xxxxx
& Xxxxxxx LLP
000
X.
00xx
Xxxxxx
Xxxxx
000
Xxxxxxxxxxxx,
Xxxxxxx 00000
Attention:
J. Xxxxxxx Xxxxx
Facsimile
No.: (000) 000-0000
(b) If
to
Seller, to:
Alliance
Systems, Ltd.
0000
X.
Xxxxx Xxxxxxx
Xxxxx,
Xxxxx 00000
Attention:
Xxxxx Xxxxx
Facsimile
No.: (000) 000 0000
With
a
required copy to:
Alliance
Systems, Ltd.
0000
X.
Xxxxx Xxxxxxx
Xxxxx,
Xxxxx 00000
Attention:
Legal Counsel
Facsimile
No.: (000) 000 0000
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9
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No
provision of this Agreement, including this Article 8.4,
shall
be deemed to constitute consent to the manner and address for service of process
in connection with any legal proceeding (including such arising out of or in
connection with this Agreement), which service shall be effected as required
by
applicable law.
8.5. Entire
Agreement; Assignment; Etc.
This
Agreement (including the attached Exhibits and Schedules) constitutes the entire
agreement, and supersedes all other agreements, understandings, representations
and warranties, both written and oral, among the parties with respect to the
subject matter hereof, and shall not be assignable by either party without
the
prior written consent of the other party and is not intended to create any
obligations to, or rights in respect of, any persons other than the parties
hereto.
8.6. Captions.
The
Article and paragraph captions herein are for convenience of reference only,
do
not constitute part of this Agreement and shall not be deemed to limit or
otherwise affect any of the provisions hereof.
8.7. Counterparts.
This
Agreement may be executed in the original or by facsimile or email in any number
of counterparts, each of which shall be deemed to be an original and all of
which together shall constitute one and the same instrument.
8.8. Governing
Law.
This
Agreement shall be governed by and construed in accordance with the law of
the
State of Indiana, without regard to the conflicts of laws principles
thereof.
[REMAINDER
OF PAGE INTENTIONALLY LEFT BLANK;
SIGNATURES
APPEAR ON FOLLOWING PAGE]
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IN
WITNESS WHEREOF, this Asset Purchase Agreement has been duly executed and
delivered by each of the parties hereto as of the date first written
above.
INTERACTIVE
INTELLIGENCE, INC.
|
By
|
/s/
Xxxxxxx X. Head
|
|
Xxxxxxx
X. Head
Chief
Financial Officer
|
ALLIANCE
SYSTEMS, LTD.
|
By
|
/s/
Xxxxx X. Xxxxx
|
|
Xxxxx
X. Xxxxx
Chief
Financial Officer
|
|
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|
