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EXHIBIT 2.1(a)
STOCK PURCHASE AGREEMENT
BY AND AMONG
ADAPTEC, INC., FUTURE DOMAIN CORPORATION,
XXXX X. XXXXXXXX, XXXXXXXX X. XXXXXXXX AND
CERTAIN SHAREHOLDERS OF FUTURE DOMAIN CORPORATION
July 13, 1995
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TABLE OF CONTENTS
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1. Certain Definitions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1
2. Purchase and Sale of Company Shares . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3
2.1 Basic Transaction . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3
2.2 The Closing . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3
2.3 Deliveries at the Closing . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4
3. Representations and Warranties Concerning the Transaction . . . . . . . . . . . . . . . . . 4
3.1 Representations and Warranties of the Sellers . . . . . . . . . . . . . . . . . . . 4
3.2 Representations and Warranties of the Buyer . . . . . . . . . . . . . . . . . . . . 5
4. Representations and Warranties Concerning the Company . . . . . . . . . . . . . . . . . . . 6
4.1 Organization, Qualification, and Corporate Power . . . . . . . . . . . . . . . . . . 6
4.2 Capitalization . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7
4.3 Noncontravention . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7
4.4 Fees . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7
4.5 Financial Statements . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7
4.6 Subsidiaries . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8
4.7 Title to Assets . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8
4.8 Events Subsequent to Most Recent Fiscal Year End . . . . . . . . . . . . . . . . . . 8
4.9 Undisclosed Liabilities . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11
4.10 Legal Compliance . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11
4.11 Tax Matters . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11
4.12 Properties . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 12
4.13 Intellectual Property . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 13
4.14 Tangible Assets . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 14
4.15 Inventory . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 14
4.16 Contracts . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 14
4.17 Notes and Accounts Receivable . . . . . . . . . . . . . . . . . . . . . . . . . . . 16
4.18 Power of Attorney . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 16
4.19 Insurance . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 16
4.20 Litigation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 17
4.21 Product Warranty . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 17
4.22 Product Liability . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 17
4.23 Employees . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 18
4.24 Employee Benefits . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 18
4.25 Guaranties . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 20
4.26 Environment, Health, and Safety . . . . . . . . . . . . . . . . . . . . . . . . . . 20
4.27 Certain Business Relationships With the Company . . . . . . . . . . . . . . . . . . 21
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TABLE OF CONTENTS
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4.28 No Adverse Developments . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 22
4.29 Full Disclosure . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 22
5. Pre-Closing Covenants . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 22
5.1 General . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 22
5.2 Notices and Consents . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 22
5.3 Operation of Business . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 23
5.4 Preservation of Business . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 23
5.5 Access to Information; Due Diligence . . . . . . . . . . . . . . . . . . . . . . . . 23
5.6 Notice of Developments . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 23
5.7 Exclusivity . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 24
6. Post-Closing Covenants . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 24
6.1 General . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 24
6.2 Litigation Support . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 24
6.3 Transition . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 24
6.4 Confidentiality . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 25
7. Conditions to Obligation to Close . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 25
7.1 Conditions to the Buyer's Obligation to Close . . . . . . . . . . . . . . . . . . . 25
7.2 Conditions to the Sellers' Obligation . . . . . . . . . . . . . . . . . . . . . . . 27
8. Remedies for Breaches of This Agreement . . . . . . . . . . . . . . . . . . . . . . . . . . 28
8.1 Survival of Representations and Warranties . . . . . . . . . . . . . . . . . . . . . 28
8.2 Indemnification Provisions for Benefit of the Buyer . . . . . . . . . . . . . . . . 28
8.3 Procedure for Asserting Claims . . . . . . . . . . . . . . . . . . . . . . . . . . . 29
8.4 Matters Involving Third Parties . . . . . . . . . . . . . . . . . . . . . . . . . . 29
8.5 No Indemnity for Corporate Agents . . . . . . . . . . . . . . . . . . . . . . . . . 30
8.6 Exclusivity of Remedy . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 30
9. Termination . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 30
9.1 Termination of the Agreement . . . . . . . . . . . . . . . . . . . . . . . . . . . . 30
9.2 Effect of Termination . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 31
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(CONTINUED)
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10. Miscellaneous . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 31
10.1 Press Releases and Public Announcements . . . . . . . . . . . . . . . . . . . . . . 31
10.2 No Third-Party Beneficiaries . . . . . . . . . . . . . . . . . . . . . . . . . . . . 31
10.3 Entire Agreement . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 31
10.4 Succession and Assignment . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 31
10.5 Counterparts . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 32
10.6 Headings . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 32
10.7 Notices . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 32
10.8 Governing Law . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 33
10.9 Forum Selection; Consent to Jurisdiction . . . . . . . . . . . . . . . . . . . . . . 33
10.10 Amendments and Waivers . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 33
10.11 Severability . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 33
10.12 Expenses . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 33
10.13 Transfer Taxes . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 33
10.14 Construction . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 33
10.15 Incorporation of Exhibits and Schedules . . . . . . . . . . . . . . . . . . . . . . 34
10.16 Sellers' Representative . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 34
10.17 Attorneys' Fees . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 34
11. Location of Definitions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 34
EXHIBITS
Exhibit 3.1 Sellers' Disclosure Schedule
Exhibit 3.2 Buyer's Disclosure Schedule
Exhibit 4 Company Disclosure Schedule
Exhibit 7.1.7(a) Employment and Non-Competition Agreement
Exhibit 7.1.7(b) Consulting Agreement
Exhibit 7.1.8 Opinion of Counsel for Sellers
Exhibit 7.1.12 General Release
Exhibit 7.2.6 Opinion of Counsel for Buyer
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STOCK PURCHASE AGREEMENT
This Stock Purchase Agreement is entered into as of July 13, 1995, by
and among FUTURE DOMAIN CORPORATION, a California corporation (the "Company"),
the holders of all of the preferred stock and a majority of the common stock of
the Company (the "Sellers"), Xxxx X. Xxxxxxxx ("Xxxx Xxxxxxxx"), Xxxxxxxx X.
Xxxxxxxx ("Xxxxxxxx Xxxxxxxx") and ADAPTEC, INC., a California corporation (the
"Buyer"). As used herein, the "Company" shall mean, unless the context
requires otherwise, FUTURE DOMAIN CORPORATION and the Subsidiary (as defined in
Section 4.6 below). The Company, the Sellers, Xxxx Xxxxxxxx, Xxxxxxxx Xxxxxxxx
and the Buyer are sometimes referred to herein individually as a "Party" and
collectively as the "Parties."
RECITALS
The Sellers in the aggregate own all of the outstanding preferred
stock and a majority of the common stock of the Company.
In order to induce Buyer to purchase the shares from Sellers, each of
Xxxx Xxxxxxxx and Xxxxxxxx Xxxxxxxx desires to make certain representations and
warranties, and to enter into certain agreements, as set forth herein.
This Agreement contemplates a transaction in which the Buyer will
purchase from the Sellers, and the Sellers will sell to the Buyer, all of the
outstanding capital stock of the Company owned by them in return for cash.
The consummation of this Agreement and the sale of the shares
hereunder is intended to occur concurrently with the sale of the remaining
shares of common stock of the Company to the Buyer under a separate stock
purchase agreement (the "Minority Shareholder Agreement"), such that upon the
closing of both transactions, the Buyer will own all of the outstanding capital
stock of the Company.
NOW, THEREFORE, in consideration of the premises and the mutual
promises herein made, and in consideration of the representations, warranties,
and covenants herein contained, the Parties agree as follows:
AGREEMENT
1. Certain Definitions. As used in this Agreement the following
terms have the following meanings (terms defined in the singular to have a
correlative meaning when used in the plural and vice versa). Certain other
terms are defined in the text of this Agreement, the location of which is set
forth in Section 11 hereof.
"Affiliate" of a Person means any other Person that directly or
indirectly, through one or more intermediaries, controls, is controlled by, or
is under common control with such Person.
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"Confidential Information" means any information concerning the
business and affairs of the Company that is designated by the Company as
confidential except for information which (i) was known to, or had been (or was
in the process of being) independently developed by, Buyer or an Affiliate of
Buyer prior to the receipt thereof from the Company; (ii) was at the time of
disclosure by the Company a matter of public knowledge through no fault of the
Buyer or an Affiliate of Buyer; or (iii) was or hereafter is obtained by the
Buyer or an Affiliate of Buyer from a third party under no duty of
confidentiality to the Company.
"Employee Benefit Plan" means any (a) nonqualified deferred
compensation, retirement plan, severance plan or similar plan or arrangement;
(b) Employee Pension Benefit Plan; (c) Employee Welfare Benefit Plan; (d)
Multiemployer Plan; and (e) any other nonqualified plan providing welfare
benefits, including but not limited to medical, dental, life insurance and
disability benefits.
"Employee Pension Benefit Plan" has the meaning set forth in ERISA
Sec. 3(2).
"Employee Welfare Benefit Plan" has the meaning set forth in ERISA
Sec. 3(l).
"ERISA" means the Employee Retirement Income Security Act of 1974, as
amended.
"Gross Negligence" consists of an intentional act, or the failure to
perform a duty, with reckless disregard for the results.
"Intellectual Property" means (a) all inventions (whether patentable
or unpatentable and whether or not reduced to practice), all improvements
thereto, and all patents, patent applications, and patent disclosures, together
with all reissuances, continuations, continuations-in-part, revisions,
extensions, and reexaminations thereof, (b) all trademarks, service marks,
trade dress, logos, trade names, and corporate names, together with all
translations, adaptations, derivations, and combinations thereof and including
all goodwill associated therewith, (c) all copyrightable works, all copyrights,
and all applications, registrations, and renewals in connection therewith, (e)
all trade secrets and confidential business information (including ideas,
research and development, know-how, formulas, compositions, drawings,
specifications, customer and supplier lists, pricing and cost information,
financial information, and business and marketing plans and proposals), (f) all
computer software (including data and related documentation), (g) all other
proprietary rights, and (h) all copies and tangible embodiments thereof (in
whatever form or medium).
"Majority Shareholders" shall mean the Xxxxxxxx Family Trust and the
Xxxxxxxx Charitable Remainder Trust.
"Material Adverse Effect" shall mean a material adverse effect on the
business, financial condition, operations, results of operations, or future
prospects of the Company.
"Multiemployer Plan" has the meaning set forth in ERISA Sec. 3(37)
and Code Sec. 414(f).
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"Ordinary Course of Business" means the ordinary course of business
consistent with past custom and practice (including with respect to quantity
and frequency).
"Person" means an individual, a partnership, a corporation, an
association, a joint stock company, a trust, a joint venture, an unincorporated
organization, or a governmental entity (or any department, agency, or political
subdivision thereof).
"Security Interest" means any mortgage, pledge, lien, encumbrance,
charge, or other security interest, other than (a) mechanic's, materialmen's,
and similar liens, (b) liens for taxes not yet due and payable, (c) purchase
money liens and liens securing rental payments under capital lease
arrangements, and (d) other liens arising in the Ordinary Course of Business
and not incurred in connection with the borrowing of money.
2. Purchase and Sale of Company Shares.
2.1 Basic Transaction. Subject to the terms and
conditions of this Agreement, the Buyer agrees to purchase from each of the
Sellers, and each of the Sellers agrees to sell to the Buyer, all of his, her
or its shares of capital stock of the Company (the "Company Shares") at the
Closing for the consideration specified below:
2.1.1 Initial Payment. The Buyer agrees to pay to
the Sellers at Closing the amount of $2.57194971 for each share of Common Stock
of the Company then held and $51.43899425 for each share of Preferred Stock of
the Company then held, for a total initial payment of $20,623,847.48 for all of
such shares, in cash, payable by Buyer's check, subject to the Sellers'
delivery instructions as to certain portions of the initial payment as set
forth in Section 2.5 below. The total purchase price shall be allocated among
the Sellers in proportion to their respective holdings of Preferred and Common
Stock as set forth in Section 4.2.1 of the Company Disclosure Schedule.
2.1.2 Final Payment. The Buyer agrees to pay to
the Sellers not later than the date which is twelve (12) months after the
Closing a final payment equal in the aggregate to $1,325,000 less any amounts
withheld and set off by Buyer pursuant to Section 8 of this Agreement, and
subject to the Sellers' delivery instructions as to four percent (4%) of such
final payment as set forth in the last sentence of this paragraph. Such
payment shall be made in cash by Buyer's check and shall be paid to the
Sellers' in the same proportionate amounts as the initial payment under Section
2.1.1 above. Pursuant to Sellers' request, Buyer shall pay four percent (4%)
of the final payment to L. H. Friend, Weinress, Xxxxxxxx and Xxxxxxx ("X. X.
Friend").
2.2 The Closing. The closing of the transactions
contemplated by this Agreement (the "Closing") shall take place at the offices
of Wilson, Sonsini, Xxxxxxxx & Xxxxxx, Professional Corporation, 000 Xxxx Xxxx
Xxxx, Xxxx Xxxx, XX 00000-0000, on or before July 13, 1995, commencing at 9:00
a.m. local time or, if all required governmental approvals (including any
approvals under the Xxxx-Xxxxx-Xxxxxx Antitrust Improvements Act of 1976, as
amended (the "Xxxx-Xxxxx-Xxxxxx Act")) have not been obtained and all closing
conditions satisfied or waived by such
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date, then on the fifth business day following the receipt of such governmental
approvals and the satisfaction or waiver of all closing conditions set forth in
Section 7 (other than conditions with respect to actions the respective Parties
will take at the Closing itself). The date on which the Closing occurs is
referred to herein as the "Closing Date".
2.3 Deliveries at the Closing. At the Closing, (i) the
Sellers will deliver to the Buyer the various certificates, instruments, and
documents referred to in Section 7.1 below; (ii) the Buyer will deliver to the
Sellers the various certificates, instruments, and documents referred to in
Section 7.2 below; (iii) each of the Sellers will deliver to the Buyer stock
certificates representing all of such Sellers' Company Shares, endorsed in
blank or accompanied by duly executed assignment documents; and (iv) the Buyer
will deliver the initial payment specified in Section 2.1.1 above as follows:
(A) $455,850.98 to L.H. Friend, (B) $87,495.39 to Xxxxxx Godward Xxxxxx
Xxxxxxxxx & Xxxxx, plus related costs in the amount specified by the Company to
the Buyer at the Closing and (C) the remainder to the Sellers, pro rata, based
on their respective holdings of Company Shares.
3. Representations and Warranties Concerning the Transaction
3.1 Representations and Warranties of the Sellers. Each
of the Sellers represents and warrants to the Buyer that the statements
contained in this Section 3.1 are correct and complete as of the date of this
Agreement and will be correct and complete as of the Closing Date (as though
made then and as though the Closing Date were substituted for the date of this
Agreement throughout this Section 3.1) with respect to such Seller, except as
set forth in the disclosure schedule delivered by the Sellers to the Buyer on
the date hereof (and initialed by the Sellers and the Buyer), a copy of which
is attached hereto as Exhibit 3.1 (referred to herein as the "Sellers'
Disclosure Schedule"). The Sellers' Disclosure Schedule will be arranged in
paragraphs corresponding to the numbered paragraphs contained in this Section
3.1.
3.1.1 Organization of Certain Sellers. If the
Seller is a corporation, the Seller is duly organized, validly existing, and in
good standing under the laws of the jurisdiction of its incorporation.
3.1.2 Authorization of Transaction. The Seller has
full power and authority to execute and deliver this Agreement, to consummate
the transactions contemplated hereunder and to perform such Sellers'
obligations hereunder and no other proceedings on the part of such Seller are
necessary to authorize the execution, delivery and performance of this
Agreement. This Agreement constitutes the valid and legally binding obligation
of the Seller, enforceable in accordance with its terms and conditions. The
Seller need not give any notice to, make any filing with, or obtain any
authorization, consent, or approval of any government or governmental agency in
order to consummate the transactions contemplated by this Agreement.
3.1.3 Noncontravention. Neither the execution and
the delivery of this Agreement, nor the consummation of the transactions
contemplated hereby, nor the performance of the Sellers' obligations hereunder,
will (A) violate any constitution, statute, regulation, rule,
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injunction, judgment, order, decree, ruling, charge, or other restriction of
any government, governmental agency, or court to which the Seller is
subject, or (B) (i) conflict with, (ii) result in a breach of, (iii) constitute
a default under, (iv) result in the acceleration of, (v) create in any party
the right to accelerate, terminate, modify, or cancel, or (vi) require any
notice under, any agreement, contract, lease, license, instrument, franchise,
permit or other arrangement to which the Seller is a party or by which such
Seller is bound or to which any of such Sellers' assets is subject.
3.1.4 Fees. Except as provided in (i) the
Engagement Agreement dated September 14, 1994 between the Company and L.H.
Friend and (ii) Section 10.12 of this Agreement, the Seller has no liability
or obligation to pay any fees or commissions to any broker, finder, agent or
attorney with respect to the transactions contemplated by this Agreement.
3.1.5 Company Shares. The Seller holds of record
and owns beneficially the number of Company Shares set forth next to such
Seller's name in Section 4.2.1 of the Company Disclosure Schedule, free and
clear of any restrictions on transfer, taxes, Security Interests, options,
warrants, purchase rights, contracts, commitments, equities, claims, and
demands and upon delivery of the stock certificates representing the Company
Shares at Closing and payment therefor as provided in Section 2.2 above, Buyer
will acquire valid title thereto, free and clear of all Security Interests and
restrictions on transfer. The Seller is not a party to any option, warrant,
purchase right, or other contract or commitment that could require the Seller
to sell, transfer, or otherwise dispose of any capital stock of the Company
(other than this Agreement). The Seller is not a party to any voting trust,
proxy, or other agreement or understanding with respect to the voting of any
capital stock of the Company.
3.2 Representations and Warranties of the Buyer. The
Buyer represents and warrants to the Sellers that the statements contained in
this Section 3.2 are correct and complete as of the date of this Agreement and
will be correct and complete as of the Closing Date (as though made then and as
though the Closing Date were substituted for the date of this Agreement
throughout this Section 3.2), except as set forth in the disclosure schedule
delivered by the Buyer to the Sellers on the date hereof (and initialed by the
Buyer and the Sellers), a copy of which is attached hereto as Exhibit 3.2
(referred to herein as the "Buyer's Disclosure Schedule"). The Buyer's
Disclosure Schedule will be arranged in paragraphs corresponding to the
numbered paragraphs contained in this Section 3.2.
3.2.1 Organization of the Buyer. The Buyer is a
corporation duly organized, validity existing, and in good standing under the
laws of the jurisdiction of its incorporation.
3.2.2 Authorization of Transaction. The Buyer has
full power and authority (including full corporate power and authority) to
execute and deliver this Agreement and to perform its obligations hereunder.
This Agreement constitutes the valid and legally binding obligation of the
Buyer, enforceable in accordance with its terms and conditions. The Buyer need
not give any notice to, make any filing with, or obtain any authorization,
consent, or approval of any government or governmental agency in order to
consummate the transactions contemplated by this Agreement.
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3.2.3 Noncontravention. Neither the execution and
the delivery of this Agreement, nor the consummation of the transactions
contemplated hereby, will (A) violate any constitution, statute, regulation,
rule, injunction, judgment, order, decree, ruling, charge, or other restriction
of any government, governmental agency, or court to which the Buyer is subject
or any provision of its charter or bylaws, or (B) (i) conflict with, (ii)
result in a breach of, (iii) constitute a default under, (iv) result in the
acceleration of, (v) create in any party the right to accelerate, terminate,
modify, or cancel, or (vi) require any notice under, any agreement, contract,
lease, license, instrument, or other arrangement to which the buyer is a party
or by which it is bound or to which any of its assets is subject.
3.2.4 Brokers' Fees. Except with respect to an
investment banking fee to be paid to Bear, Xxxxxxx & Co., Inc., the Buyer has no
liability or obligation to pay any fees or commissions to any broker, finder,
or agent with respect to the transactions contemplated by this Agreement for
which any Seller could become liable or obligated.
3.2.5 Investment. The Buyer is acquiring the
Company Shares for investment and not with a view to or for sale in connection
with any distribution thereof within the meaning of the Securities Act of 1933,
as amended (the "Securities Act").
4. Representations and Warranties Concerning the Company. The
Company, the Majority Shareholders, Xxxx Xxxxxxxx and Xxxxxxxx Xxxxxxxx hereby
jointly and severally represent and warrant to the Buyer that the statements
contained in this Section 4 are correct and complete as of the date of this
Agreement and will be correct and complete as of the Closing Date (as though
made then and as though the Closing Date were substituted for the date of this
Agreement throughout this Section 4), except as set forth in the disclosure
schedule delivered by the Company to the Buyer on the date hereof (and
initialed by the Buyer), a copy of which is attached hereto as Exhibit 4
(referred to herein as the "Company Disclosure Schedule") and except for
events occurring in the Ordinary Course of Business of the Company between the
date of this Agreement and the Closing Date, which events are not material
individually or in the aggregate, do not violate any of the covenants or
agreements of the Company or the Sellers herein in any material respect, and
are disclosed to the Buyer by means of an updated Company Disclosure Schedule
not less than two days prior to the Closing. The Company Disclosure Schedule
will be arranged in paragraphs corresponding to the lettered and numbered
paragraphs contained in this Section 4.
4.1 Organization, Qualification, and Corporate Power.
The Company is a corporation duly organized, validly existing, and in good
standing under the laws of the jurisdiction of its incorporation. The Company
is duly authorized to conduct business and is in good standing under the laws
of each jurisdiction where such qualification is required. The Company has
full corporate power and authority, and has all necessary licenses and permits,
to carry on the businesses in which it is engaged and to own and use the
properties owned and used by it. Section 4.1 of the Company Disclosure
Schedule lists the directors and officers of the Company. The operations now
being conducted by the Company have not been conducted under any other name
during the past five (5) years.
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4.2 Capitalization.
4.2.1 Capital Stock. The entire authorized capital
stock of the Company consists of (i) 150,000 shares of Preferred Stock, all of
which are designated Series A Convertible Preferred Stock, 141,045 of which are
issued and outstanding, and are convertible into an aggregate of 2,820,900
shares of Common Stock, and (ii) 20,000,000 shares of Common Stock, 6,342,880
of which are issued and outstanding. All of the issued and outstanding shares
of capital stock have been duly authorized, are validly issued, fully paid, and
nonassessable, and are held of record by the respective Sellers as set forth in
Section 4.2.1 of the Company Disclosure Schedule. All of the outstanding
shares of capital stock have been offered, issued and sold by the Company in
compliance with applicable Federal and state securities laws.
4.2.2 No Other Rights or Agreements. Except for an
option to purchase 1,000 shares of Common Stock, there are no outstanding or
authorized options, warrants, purchase rights, subscription rights, conversion
rights, exchange rights, preemptive rights or other contracts or commitments
that could require the Company to issue, sell, or otherwise cause to become
outstanding any of its capital stock. The stock option described in the
preceding sentence will be exercised in full prior to the Closing. There are
no outstanding or authorized stock appreciation, phantom stock, profit
participation, or similar rights with respect to the Company. There are no
voting trusts, proxies, or other agreements or understandings with respect to
the voting of the capital stock of the Company.
4.3 Noncontravention. Neither the execution and the
delivery of this Agreement, nor the consummation of the transactions
contemplated hereby, will (A) violate any constitution, statute, regulation,
rule, injunction, judgment, order, decree, ruling, charge, or other restriction
of any government, governmental agency, or court to which the Company is
subject or any provision of its charter or bylaws, or (B) (i) conflict with,
(ii) result in a breach of, (iii) constitute a default under, (iv) result in
the acceleration of, (v) create in any party the right to accelerate,
terminate, modify, or cancel, or (vi) require any notice under, any agreement,
contract, lease, license, instrument, franchise permit or other arrangement to
which the Company is a party or by which it is bound or to which any of its
assets is subject (or result in the imposition of any Security Interest upon
any of its assets). The Company is not required to give any notice to, make
any filing with, or obtain any authorization, consent, or approval of any
government or governmental agency in order for the Parties to consummate the
transactions contemplated by this Agreement.
4.4 Fees. The Company has no liability or obligation to
pay any fees or commissions to any broker, finder, agent or attorney with
respect to the transactions contemplated by this Agreement.
4.5 Financial Statements. Section 4.5 of the Company
Disclosure Schedule contains the following financial statements (collectively
the "Financial Statements"): (i) audited consolidated balance sheets and
statements of income, changes in stockholders' equity, and cash flow as of and
for
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the fiscal years ended March 31, 1993, March 31, 1994 and March 31, 1995 (the
"Most Recent Fiscal Year End") for the Company. The audited financial
statements for the fiscal year ended March 31, 1995 are referred to herein as
the "Most Recent Financial Statements." The Financial Statements (including the
notes thereto) have been prepared in accordance with generally accepted
accounting principles applied on a consistent basis throughout the periods
covered thereby and present fairly the financial condition of the Company as of
such dates and the results of operations of the Company for such periods. The
books of account of the Company reflect as of the dates shown thereon
substantially all items of income and expenses, and all assets, liabilities and
accruals of the Company required to be reflected therein, in accordance with
generally accepted accounting principles consistently applied.
4.6 Subsidiaries. Future Domain Foreign Sales
Corporation (the "Subsidiary") is the only entity in which the Company holds,
directly or indirectly, an equity interest. The Company owns and has good and
valid title to all of the outstanding shares of the capital stock of the
Subsidiary free of any liens or adverse claims (other than any liens or adverse
claims existing by virtue of applicable securities laws). All of the issued
and outstanding shares of capital stock of the Subsidiary have been duly
authorized and are validly issued, fully paid, and nonassessable. There are no
outstanding or authorized options, warrants, purchase rights, subscription
rights, conversion rights, exchange rights, preemptive rights or other
contracts or commitments that could require the Company to sell, transfer, or
otherwise dispose of any capital stock of the Subsidiary or that could require
the Subsidiary to issue, sell, or otherwise cause to become outstanding any of
its own capital stock. There are no outstanding stock appreciation, phantom
stock, profit participation, or similar rights with respect to the Subsidiary.
There are no voting trusts, proxies, or other agreements or understandings with
respect to the voting of any capital stock of the Subsidiary.
4.7 Title to Assets. The Company has good and marketable
title to, or a valid leasehold interest in, the properties and assets used by
it, located on its premises, or shown on the balance sheet contained within the
Most Recent Financial Statements (the "Most Recent Balance Sheet") or acquired
after the date thereof, free and clear of all Security Interests, except for
properties and assets disposed of in the Ordinary Course of Business since the
Most Recent Fiscal Year End. No Person other than the Company owns any assets
or properties currently utilized in or reasonably necessary to the operations
or business of the Company or situated on any of the premises of the Company.
There are no existing contracts, agreements, commitments or arrangements with
any Person to acquire any of the assets or properties of the Company (or any
interest therein) except for this Agreement and those contracts entered into
during the Ordinary Course of Business for the sale of products and services to
customers of the Company.
4.8 Events Subsequent to Most Recent Fiscal Year End.
Since March 31, 1995, there has not been any material adverse change in the
business, financial condition, operations, results of operations, or future
prospects of the Company. Without limiting the generality of the foregoing,
since that date:
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4.8.1 the Company has not sold, leased,
transferred, or assigned any assets or properties, tangible or intangible,
outside the Ordinary Course of Business,
4.8.2 the Company has not entered into any
agreement, contract, lease, or license outside the Ordinary Course of Business;
4.8.3 no party (including the Company) has
accelerated, terminated, made modifications to, or canceled any agreement,
contract, lease, or license to which the Company is a party or by which it is
bound and the Company has not modified, canceled or waived or settled any debts
or claims held by it, outside the Ordinary Course of Business, or waived or
settled any rights or claims of a substantial value, whether or not in the
Ordinary Course of Business;
4.8.4 none of the assets of the Company, tangible
or intangible, has become subject to any Security Interest;
4.8.5 the Company has not made any capital
expenditures except in the Ordinary Course of Business and not exceeding
$1,000,000 in the aggregate of all such capital expenditures;
4.8.6 the Company has not made any capital
investment in, or any loan to, any other Person;
4.8.7 the Company has not created, incurred,
assumed, or guaranteed any indebtedness for borrowed money and capitalized
lease obligations;
4.8.8 the Company has not granted any license or
sublicense of any rights under or with respect to any Intellectual Property;
4.8.9 there has been no change made or authorized
in the charter or bylaws of the Company;
4.8.10 the Company has not issued, sold, or
otherwise disposed of any of its capital stock, or granted any options,
warrants, or other rights to purchase or obtain (including upon conversion,
exchange, or exercise) any of its capital stock;
4.8.11 the Company has not declared, set aside, or
paid any dividend or made any distribution with respect to its capital stock
(whether in cash or in kind) or redeemed, purchased, or otherwise acquired any
of its capital stock;
4.8.12 the Company has not experienced any damage,
destruction, or loss (whether or not covered by insurance) to its property in
excess of $25,000 in the aggregate of all such damage, destruction and losses;
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4.8.13 the Company has not suffered any repeated,
recurring or prolonged shortage, cessation or interruption of inventory
shipments, supplies or utility services;
4.8.14 the Company has not made any loan to, or
entered into any other transaction with, any of its Affiliates, directors,
officers, or employees or their Affiliates, and, in any event, any such
transaction was on fair and reasonable terms no less favorable to the Company
than would be obtained in a comparable arm's length transaction with a Person
which is not such a director, officer or employee or Affiliate thereof;
4.8.15 the Company has not entered into any
employment contract or collective bargaining agreement, written or oral, or
modified the terms of any existing such contract or agreement;
4.8.16 the Company has not granted any increase in
the base compensation of any of its directors or officers, or, except in the
Ordinary Course of Business, any of its employees;
4.8.17 the Company has not adopted, amended,
modified, or terminated any bonus, profit-sharing, incentive, severance, or
other plan, contract, or commitment for the benefit of any of its directors,
officers, or employees (or taken any such action with respect to any other
Employee Benefit Plan);
4.8.18 the Company has not made any other change in
employment terms for any of its directors, officers, or employees outside the
Ordinary Course of Business;
4.8.19 the Company has not suffered any adverse
change or any threat of any adverse change in its relations with, or any loss
or threat of loss of, any of its major customers, distributors or dealers;
4.8.20 the Company has not suffered any adverse
change or any threat of any adverse change in its relations with, or any loss
or threat of loss of, any of it major suppliers;
4.8.21 the Company has not received notice or had
knowledge of any actual or threatened labor trouble or strike, or any other
occurrence, event or condition of a similar character;
4.8.22 the Company has not changed any of the
accounting principles followed by it or the method of applying such principles;
4.8.23 the Company has not made a change in any of
its banking or safe deposit arrangements;
4.8.24 the Company has not entered into any
transaction other than in the Ordinary Course of Business; and
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4.8.25 the Company has not committed to any of the
foregoing.
4.9 Undisclosed Liabilities. The Company has no
liability (whether known or unknown, whether asserted or unasserted, whether
absolute or contingent, whether accrued or unaccrued, whether liquidated or
unliquidated, and whether due or to become due, including any liability for
taxes), except for (i) liabilities set forth on the face of the Most Recent
Balance Sheet (rather than in any notes thereto) and (ii) liabilities which
have arisen after the Most Recent Fiscal Year End in the Ordinary Course of
Business.
4.10 Legal Compliance. The Company has complied with all
applicable laws (including rules, regulations, codes, plans, injunctions,
judgments, orders, decrees, rulings, and charges thereunder) of federal, state,
local, and foreign governments (and all agencies thereof). No action, suit,
proceeding, hearing, investigation, charge, complaint, claim, demand, notice or
inquiry has been filed or commenced against, or received by, any governmental
body alleging any failure to so comply. The licenses, permits, approvals,
registrations, qualifications, certificates and other governmental
authorizations that are listed on Section 4.10 of the Company Disclosure
Schedule are the only governmental authorizations that are necessary for the
operations of the Company.
4.11 Tax Matters.
4.11.1 For purposes of this Agreement, "Taxes" means
all federal, state, municipal, local or foreign income, gross receipts,
windfall profits, severance, property, production, sales, use, value added,
license, excise, franchise, employment, withholding, capital stock, levies,
imposts, duties, transfer and registration fees or similar taxes or charges
imposed on the income, payroll, properties or operations of the Company,
together with any interest, additions or penalties, deficiencies or assessments
with respect thereto and any interest in respect of such additions or
penalties.
4.11.2 The Company has filed all reports and returns
with respect to any Taxes ("Tax Returns") that it was required to file. All
such Tax Returns were correct and complete in all respects, and no such Tax
Returns are currently the subject of audit. All Taxes owed by the Company
(whether or not shown on any Tax Return) were paid in full when due or are
being contested in good faith and are supported by adequate reserves on the
Most Recent Balance Sheet. The Company has provided adequate reserves on its
Financial Statements for the payment of any taxes accrued but not yet due and
payable. The Company is not currently the beneficiary of any extension of time
within which to file any Tax Return, and the Company has not waived any statute
of limitations in respect of Taxes or agreed to any extension of time with
respect to any Tax assessment or deficiency.
4.11.3 There is no dispute or claim concerning any
Tax liability of the Company either (A) claimed or raised by any authority in
writing or (B) based upon personal contact with any agent of such authority.
There are no tax liens of any kind upon any property or assets of the Company,
except for inchoate liens for taxes not yet due and payable.
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4.11.4 The Company has not filed a consent under
Sec. 341(f) of the Internal Revenue Code of 1986, as amended (the "Code")
concerning collapsible corporations. The Company has not made any payments, is
not obligated to make any payments, and is not a party to any agreement that
under any circumstances could obligate it to make any payments that will not be
deductible under Code Sec. 280G. The Company has not been a United States real
property holding corporation within the meaning of Code Sec. 897(c)(2) during
the applicable period specified in Code Sec. 897(c)(1)(A)(ii). The Company is
not a party to any tax allocation or sharing agreement. The Company (A) has
not been a member of any affiliated group within the meaning of Code Sec. 1504
or any similar group defined under a similar provision of state, local, or
foreign law (an "Affiliated Group") filing a consolidated federal Income Tax
Return (other than a group the common parent of which was the Company) and (B)
has no any liability for the taxes of any Person (other than any of the Company
and its Subsidiaries) under Treas. Reg. Section 1.1502-6 (or any similar
provision of state, local, or foreign law), as a transferee or successor, by
contract, or otherwise.
4.11.5 The unpaid Taxes of the Company (A) did not,
as of the Most Recent Fiscal Year End, exceed by any amount the reserve for Tax
liability (rather than any reserve for deferred taxes established to reflect
timing differences between book and tax income) set forth on the face of the
Most Recent Balance Sheet (rather than in any notes thereto) and (B) will not
exceed by any material amount that reserve as adjusted for operations and
transactions through the Closing Date in accordance with the past custom and
practice of the Company in filing its Tax Returns.
4.12 Properties
4.12.1 The Company owns no real property.
4.12.2 Section 4.12.2 of the Company Disclosure
Schedule lists and describes briefly all real property leased or subleased to
the Company. The Company has delivered to the Buyer correct and complete
copies of the leases and subleases listed in Section 4.12.2 of the Company
Disclosure Schedule (as amended to date), with respect to each lease and
sublease listed in Section 4.12.2 of the Company Disclosure Schedule:
4.12.2.1 the lease or sublease is legal,
valid, binding, enforceable, and in full force and effect in all respects;
4.12.2.2 no party to the lease or sublease
is in breach or default, and no event has occurred which, with notice or lapse
of time, would constitute a breach or default or permit termination,
modification, or acceleration thereunder;
4.12.2.3 no party to the lease or sublease
has repudiated any provision thereof;
4.12.2.4 there are no disputes, oral
agreements, or forbearance programs in effect as to the lease or sublease;
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4.12.2.5 the Company has not assigned,
transferred, conveyed, mortgaged, deeded in trust, or encumbered any interest
in the leasehold or subleasehold; and
4.12.2.6 all facilities leased or subleased
thereunder have received all approvals of governmental authorities (including
licenses and permits) required in connection with the operation thereof, and
have been operated and maintained in accordance with applicable laws, rules,
and regulations in all respects.
4.13 Intellectual Property.
4.13.1 The Company has not interfered with,
infringed upon, misappropriated or violated any Intellectual Property rights of
third parties in any respect, and none of the directors and officers of the
Company has received during the last seven years any charge, complaint, claim,
demand, or notice alleging any such interference, infringement,
misappropriation, or violation (including any claim that any of the Company
must license or refrain from using any Intellectual Property rights of any
third party). No third party has interfered with, infringed upon,
misappropriated, or violated any Intellectual Property rights of the Company.
4.13.2 Section 4.13.2 of the Company Disclosure
Schedule identifies each patent or registration which has been issued to the
Company with respect to any of its Intellectual Property, identifies each
pending patent application or application for registration which the Company
has made with respect to any of its Intellectual Property, and identifies each
license, agreement, or other permission which the Company has granted to any
third party with respect to any of its Intellectual Property (together with any
exceptions). The Company has made available the Buyer correct and complete
copies of all such patents, registrations, applications, licenses, agreements,
and permissions (as amended to date). Section 4.13.2 of the Company Disclosure
Schedule also identifies (i) each trade name or unregistered trademark used by
the Company in connection with any of its businesses and (ii) each unregistered
copyright owned by the Company. With respect to each item of Intellectual
Property required to be identified in Section 4.13.2 of the Company Disclosure
Schedule:
4.13.2.1 the Company possesses all right,
title, and interest in and to the item, free and clear of any Security
Interest, license, or other restriction;
4.13.2.2 the item is legal and valid and in
full force and effect and is not subject to any outstanding injunction,
judgment, order, decree, ruling, or charge;
4.13.2.3 no action, suit, proceeding,
hearing, investigation, charge, complaint, claim, or demand is pending or
threatened which challenges the legality, validity, enforceability, use or
ownership of the item; and
4.13.2.4 The Company has never agreed to
indemnify any Person for or against any interference, infringement,
misappropriation, or other conflict with respect to the item.
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4.13.3 Section 4.13.3 of the Company Disclosure
Schedule identifies each item of Intellectual Property that any third party
owns and that the Company uses pursuant to license, sublicense, agreement, or
permission. The Company has made available to the Buyer correct and complete
copies of all such licenses, sublicenses, agreements, and permissions (as
amended to date). With respect to each item of Intellectual Property required
to be identified in Section 4.13.3 of the Company Disclosure Schedule:
4.13.3.1 the license, sublicense,
agreement or permission covering the item is legal, valid, binding,
enforceable, and in full force and effect in all respects;
4.13.3.2 no party to the license,
sublicense, agreement, or permission is in breach or default, and no event has
occurred which with notice or lapse of time would constitute a breach or
default or permit termination, modification or acceleration thereunder;
4.13.3.3 no party to the license,
sublicense, agreement, or permission has repudiated any provision thereof; and
4.13.3.4 The Company has not granted any
sublicense or similar right with respect to the license, sublicense,
agreement, or permission.
4.14 Tangible Assets. The buildings, machinery,
equipment and other tangible assets that the Company owns and leases are free
from defects (patent and latent), have been maintained in accordance with
normal industry practice, and are in good operating condition and repair
(subject to normal wear and tear) and are usable in the Ordinary Course of
Business.
4.15 Inventory. All of the inventory of the Company,
which consists of raw materials and supplies, manufactured and processed parts,
work in process, and finished goods, is usable, merchantable and fit for the
purpose for which it was procured or manufactured, and none of such inventory
is slow-moving, obsolete, damaged, or defective, subject only to the reserve
for inventory write down set forth on the face of the Most Recent Balance Sheet
as adjusted for operations and transactions through the Closing Date in
accordance with the past custom and practice of the Company.
4.16 Contracts. Section 4.16 of the Company Disclosure
Schedule lists the following contracts, agreements, commitments and other
arrangements to which the Company is a party or by which it or any of its
assets is bound:
4.16.1 any agreement (or group of related
agreements) for the lease of personal property to or from any Person providing
for lease payments in excess of $12,000 per annum;
4.16.2 any agreement (or group of related
agreements) for the purchase or sale of raw materials, commodities, supplies,
products, or other personal property, or for the
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furnishing or receipt of services, the performance of which will ex-tend over a
period of more than one year or involve consideration in excess of $25,000;
4.16.3 any agreement for the purchase of supplies,
components, products or services from single source suppliers, custom
manufacturers or subcontractors;
4.16.4 any agreement concerning a partnership or
joint venture;
4.16.5 any agreement (or group of related
agreements) under which it has created, incurred, assumed, or guaranteed any
indebtedness for borrowed money or any capitalized lease obligation in excess
of $ 1 0, 000 or under which it has imposed a Security Interest on any of its
assets, tangible or intangible;
4.16.6 any agreement concerning confidentiality,
noncompetition or restraint of trade;
4.16.7 any agreement with any Seller or any of such
Sellers' Affiliates (other than the Company) or with any Affiliate of the
Company;
4.16.8 any profit sharing, stock option, stock
purchase, stock appreciation, deferred compensation, severance, or other plan
or arrangement for the benefit of its current or former directors, officers,
and employees;
4.16.9 any collective bargaining agreement;
4.16.10 any agreement for the employment of any
individual on a full-time, part-time, consulting, or other basis;
4.16.11 any agreement under which it has advanced or
loaned any amount to any of its directors, officers, and employees;
4.16.12 any agreement under which the consequences
of a default or termination could have a Material Adverse Effect;
4.16.13 any agreement with any original equipment
manufacturer entered into or performed by the Company within the last three
years;
4.16.14 any agreement pursuant to which the Company
is obligated to provide maintenance, support or training for its products;
4.16.15 any standard form agreement used by the
Company, including, but not limited to, any purchase order, statement of
standard terms and conditions of sale, or employment offer letter;
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4.16.16 any agreement pursuant to which any of the
Company's products is manufactured; and
4.16.17 any other agreement (or group of related
agreements) the performance of which involves consideration in excess of
$12,000 or which is expected to continue for more than six months from the date
hereof.
The Company has made available to the Buyer a correct and complete copy of each
written agreement listed in Section 4.16 of the Company Disclosure Schedule (as
amended to date) and a written summary setting forth the terms and conditions
of each oral agreement referred to in Section 4.16 of the Company Disclosure
Schedule. With respect to each such agreement: (A) the agreement is legal,
valid, binding, enforceable, and in full force and effect in all respects; (B)
no party is in breach or default, and no event has occurred, which with notice
or lapse of time would constitute a breach or default, or permit termination,
modification, or acceleration, under the agreement; (C) no party has repudiated
any provision of the agreement; and (D) none of the directors or officers of
the Company has any reason to believe that the service called for thereunder
cannot be supplied in accordance with its terms and without resulting in a loss
to any of the Company.
4.17 Notes and Accounts Receivable. All notes and
accounts receivable of the Company, all of which are reflected properly on the
books and records of the Company, are valid receivables subject to no setoffs,
defenses or counterclaims, are current and collectible, and will be collected
in accordance with their terms at their recorded amounts, subject only to the
reserve for bad debts set forth on the face of the Most Recent Balance Sheet as
adjusted for operations and transactions through the Closing Date in accordance
with the past custom and practice of the Company.
4.18 Power of Attorney. There are no outstanding powers
of attorney executed on behalf of the Company.
4.19 Insurance. Section 4.19 of the Company Disclosure
Schedule sets forth the following information with respect to each insurance
policy (including policies providing property, casualty, liability, and
workers' compensation coverage and bond and surety arrangements) with respect
to which the Company is a party, a named insured, or otherwise the beneficiary
of coverage:
4.19.1 the name, address, and telephone number of
the agent;
4.19.2 the name of the insurer, the name of the
policyholder, and the name of each covered insured;
4.19.3 the policy number and the period of coverage;
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4.19.4 the scope (including an indication of whether
the coverage is on a claims made, occurrence, or other basis) and amount
(including a description of how deductibles and ceilings are calculated and
operate) of coverage; and
4.19.5 a description of any retroactive premium
adjustments or other loss-sharing arrangements.
With respect to each such insurance policy: (A) the policy is legal, valid,
binding, enforceable, and in full force and effect in all respects (and there
has been no notice of cancellation or nonrenewal of the policy received); (B)
neither the Company nor any other party to the policy is in breach or default
(including with respect to the payment of premiums or the giving of notices),
and no event has occurred which, with notice or the lapse of time, would
constitute such a breach or default, or permit termination, modification, or
acceleration, under the policy; (C) no party to the policy has repudiated any
provision thereof, and (D) there has been no failure to give any notice or
present any claim under the policy in due and timely fashion. Section 4.19 of
the Company Disclosure Schedule describes any self-insurance arrangements
affecting any of the Company.
4.20 Litigation. Section 4.20 of the Company Disclosure
Schedule sets forth each instance in which the Company (or any of its assets)
(i) is subject to any outstanding injunction, judgment, order, decree, ruling,
or charge or (ii) is or has been within the last three years a party, or, to
the knowledge of the Company, is threatened to be made a party, to any action,
suit, proceeding, hearing, arbitration, or investigation of, in, or before any
court or quasi-judicial or administrative agency of any federal, state, local,
or foreign jurisdiction or before any arbitrator. None of the Company, Xxxx
Xxxxxxxx, Xxxxxxxx Xxxxxxxx and the Majority Shareholders is aware of any facts
or circumstances which would form the basis of any claim against the Company.
4.21 Product Warranty. Substantially all of the products
manufactured, sold, leased, and delivered by the Company have conformed in all
respects with all applicable contractual commitments and all express and
implied warranties, and the Company has no liability (whether known or unknown,
whether asserted or unasserted, whether absolute or contingent, whether accrued
or unaccrued, whether liquidated or unliquidated, and whether due or to become
due) for replacement or repair thereof or other damages in connection
therewith, subject only to the reserve for product warranty claims set forth on
the face of the Most Recent Balance Sheet (rather than in any notes thereto) as
adjusted for operations and transactions through the Closing Date in accordance
with the past custom and practice of the Company. Substantially all of the
products manufactured, sold, leased, and delivered by the Company are subject
to standard terms and conditions of sale or lease. Section 4.21 of the Company
Disclosure Schedule includes copies of the standard terms and conditions of
sale or lease for the Company (containing applicable guaranty, warranty, and
indemnity provisions).
4.22 Product Liability. The Company has no liability
(whether known or unknown, whether asserted or unasserted, whether absolute or
contingent, whether accrued or unaccrued, whether liquidated or unliquidated,
and whether due or to become due) arising out of any injury, to
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individuals or property as a result of the ownership, possession, or use of any
product manufactured, sold, leased, or delivered by the Company.
4.23 Employees. No executive, key employee, or
significant group of employees has advised any of Xxxx Xxxxxxxx, Xxxxxxxx
Xxxxxxxx, Xxx Xxxxx, Xxxx Xxxxxxxx, Xxxxx Xxxxxx or Xxxxxxx Xxxxxx that he, she
or they plan to terminate employment with the Company during the next 12
months. The Company is not a party to or bound by any collective bargaining
agreement, nor has it experienced any strike or grievance, claim of unfair
labor practices, or other collective bargaining dispute within the past three
years. The Company has not committed any unfair labor practice. There is no
organizational effort presently being made or threatened by or on behalf of any
labor union with respect to employees of the Company.
4.24 Employee Benefits.
4.24.1 Section 4.24 of the Company Disclosure
Schedule lists each Employee Benefit Plan that the Company maintains or to
which the Company contributes or is obligated to contribute.
4.24.1.1 Each such Employee Benefit Plan
(and each related trust, or fund established by the Company) complies in form
and in operation in all respects with their terms, the applicable requirements
of ERISA, the Code, and other applicable laws.
4.24.1.2 All required reports and
descriptions (including Form 5500 Annual Reports, Summary Annual Reports,
PBGC-1's, and Summary Plan Descriptions) have been filed or distributed
appropriately with respect to each such Employee Benefit Plan. The
requirements of Part 6 of Subtitle B of Title 1 of ERISA and of Code Sec. 4980B
have been met in all respects with respect to each such Employee Benefit Plan
which is an Employee Welfare Benefit Plan. No event has occurred and no
condition exists with respect to any Employee Benefit Plan that would subject
the Company to any tax under Code Sections 4972, 4976 or 4979 or to a fine
under ERISA Sections 502(i) or 502(l).
4.24.1.3 All contributions, premiums or other
payments (including all employer contributions and employee salary reduction
contributions) which are due have been paid to each Employee Benefit Plan and
all contributions, premiums or other payments for any period ending on or
before the Closing Date which are not yet due shall been paid to each such
Employee Benefit Plan or shall be accrued in accordance with the custom and
practice of the Company.
4.24.1.4 Each such Employee Benefit Plan
which is an Employee Pension Benefit Plan and which is intended to qualify
under Code Sec. 401(a), has received a favorable determination letter from the
Internal Revenue Service with respect to the qualification of the plan under
Code Section 401(a) and the exemption of any corresponding trust under Code
Section 501, unless the Internal Revenue Service is deemed to have approved the
form of such Plan under applicable IRS Revenue Procedures. A copy of such
determination letters have been provided
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to the Buyer and nothing has occurred since the date of each such determination
letter that would cause such Employee Pension Benefit Plan to lose its ability
to rely on such letter. Each Employee Pension Benefit Plan has been restated
to comply with the 1986 Tax Reform Act and subsequent applicable tax
legislation to the extent required by governing tax law. A copy of any
determination letters applicable to such restatement which have been received
by the Company has been provided to the Buyer.
4.24.1.5 Neither the Company nor any other
Person or entity under common control with the Company within the meaning of
Section 414(b), (c) or (m) of the Code and the regulations thereunder has now
or at any previous time, maintained, established, sponsored, participated in,
or contributed to, any Employee Pension Benefit Plan that is subject to Part 3
of Subtitle B of Title I of ERISA, Title IV of ERISA or Section 412 of the
Code. No Employee Welfare Benefit Plan or other Employee Benefit Plan
providing welfare benefits is funded with a trust or other funding vehicle,
other than insurance policies or contracts with a health maintenance
organization or similar health care delivery entity.
4.24.1.6 The Company has made available to
the Buyer correct and complete copies of the plan documents and summary plan
descriptions, the most recent determination letter received from the Internal
Revenue Service, if any, the most recent Form 5500 Annual Report, and all
related trust agreements, insurance contracts, and other funding agreements
which implement each maintained Employee Benefit Plan. The terms of any such
documentation or other communication do not prohibit the Buyer from amending or
terminating any such Employee Benefit Plan.
4.24.2 With respect to each Employee Benefit Plan
that the Company, and/or any controlled group of corporations within the
meaning of Code Sec. 1563 (a "Controlled Group of Corporations") which includes
the Company, maintains or ever has maintained or to which any of them
contributes, ever contributed, or ever has been required to contribute:
4.24.2.1 There have been no prohibited
transactions within the meaning of ERISA Sec. 406 and Code Sec. 4975 with
respect to any such Employee Benefit Plan. No fiduciary within the meaning of
ERISA Sec. 3(21) (a "Fiduciary"), has any liability for breach of fiduciary
duty or any other failure to act or comply in connection with the
administration or investment of the assets of any such Employee Benefit Plan.
No action, suit, proceeding, hearing, or investigation with respect to the
administration or the investment of the assets of any such Employee Benefit
Plan (other than routine claims for benefits) is pending or threatened.
4.24.3 Except as disclosed in Schedule 4.24, the
Company does not maintain or contribute to, has never maintained or contributed
to, and has never been required to contribute to, any Employee Welfare Benefit
Plan or any other Employee Benefit Plan providing medical, health, or life
insurance or other welfare-type benefits for current or future retired or
terminated employees, their spouses, or their dependents (other than in
accordance with Code Sec. 4980B or Part 6 of Subtitle B of Title I of ERISA).
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4.24.4 There is no liability in connection with any
Employee Benefit Plan that is not fully disclosed or provided for on the Most
Recent Balance Sheet for which disclosure would be required under generally
accepted accounting principles.
4.24.5 No Employee Benefit Plan or the Company has
any liability to any plan participant, beneficiary or other person by reason of
the payment of benefits or the failure to pay benefits with respect to benefits
under or in connection with any such Employee Benefit Plan, other than claims
in the normal administration of such plans.
4.25 Guaranties. The Company is not a guarantor or
otherwise responsible for any liability or obligation (including indebtedness)
of any other Person.
4.26 Environment, Health, and Safety.
4.26.1 For purposes of this Agreement, the following
terms have the following meanings:
"Environmental, Health, and Safety Laws"
means any and all federal, state, local or municipal laws, rules, orders,
regulations, statutes, ordinances, codes, plans, injunctions, judgments,
decrees, requirements or rulings now or hereafter in effect, imposed by any
governmental authority regulating, relating to, or imposing liability or
standards of conduct relating to pollution or protection of the environment
(including, without limitation, ambient air, surface water, groundwater, land
surface or subsurface strata), public health and safety, or employee health and
safety, concerning any Hazardous Materials or Extremely Hazardous Substances,
as such terms as defined herein, or otherwise regulated, under any
Environmental, Health and Safety Laws. The term "Environmental, Health and
Safety Laws" shall include, without limitation, the Clean Water Act (also known
as the Federal Water Pollution Control Act), 33 U.S.C. Section 1251 et seq.
the Toxic Substances Control Act, 15 U.S.C. Section 2601 et seq., the Clean Air
Act, 42 U.S.C. Section 7401 et seq., the Federal Insecticide, Fungicide and
Rodenticide Act, 7 U.S.C. Section 136 et seq., the Safe Drinking Water Act,
42 U.S.C. Section 300f et seq., the Comprehensive Environmental Response,
Compensation and Liability Act, 42 U.S.C. Section 9601 et seq., the Superfund
Amendment and Reauthorization Act of 1986, Public Law 99-4, 99, 100 Stat. 1613,
the Emergency Planning and Community Right to Know Act, 42 U.S.C. Section 11001
et seq., the Resource Conservation and Recovery Act, 42 U.S.C. Section 6901
et seq., and the Occupational Safety and Health Act, 29 U.S.C. Section 651 et
seq., all as amended, together with any amendments thereto, regulations
promulgated thereunder and all substitutions thereof.
"Extremely Hazardous Substance" means a
substance on the list described in Section 302 (42 U.S.C. Section 11002(a)(2))
of the Emergency Planning and Community Right to Know Act, 42 U.S.C.
Section 11001 et seq., as amended.
"Hazardous Material" means any material or
substance that, whether by its nature or use, is now or hereafter defined as a
pollutant, dangerous substance, toxic substance, hazardous waste, hazardous
material, hazardous substance or contaminant under any Environmental,
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Health and Safety Laws, or which is toxic, explosive, corrosive, flammable,
infectious, radioactive, carcinogenic, mutagenic or otherwise hazardous and
which is now or hereafter regulated under any Environmental, Health and Safety
Laws, or which is or contains petroleum, gasoline, diesel fuel or other
petroleum hydrocarbon product.
4.26.2 Each of the Company and its predecessors and
Affiliates (A) has complied with the Environmental, Health, and Safety Laws in
all respects (and no action, suit, proceeding, hearing, investigation, charge,
complaint, claim, demand, directive or notice has been filed or commenced
against any of them alleging any such failure to comply), (B) has obtained and
been in substantial compliance with all of the terms and conditions of all
permits, licenses, certificates and other authorizations which are required
under the Environmental, Health, and Safety Laws, and (C) has complied in all
respects with all other limitations, restrictions, conditions, standards,
prohibitions, requirements, obligations, schedules, and timetables which are
contained in the Environmental, Health, and Safety Laws.
4.26.3 The Company has no liability (whether known
or unknown, whether asserted or unasserted, whether absolute or contingent,
whether accrued or unaccrued, whether liquidated or unliquidated, and whether
due or to become due), and none of the Company and its predecessors and
Affiliates has handled or disposed of any Hazardous Materials or extremely
Hazardous Substances, arranged for the disposal of any Hazardous Materials or
Extremely Hazardous Substances, exposed any employee or other individual to any
Hazardous Materials or Extremely Hazardous Substances, or owned or operated any
property or facility in any manner that could give rise to any liability, for
damage to any site, location, surface water, groundwater, land surface or
subsurface strata, for any illness of or personal injury to any employee or
other individual, or for any reason under any Environmental, Health, and Safety
Law.
4.26.4 No Extremely Hazardous Substances are
currently, or have been, located at, on, in, under or about all properties
and equipment used in the business of the Company and its predecessors and
Affiliates.
4.26.5 No Hazardous Materials are currently located
at, on, in, under or about all properties and equipment used in the business of
the Company and its predecessors and Affiliates in a manner which violates any
Environmental, Health and Safety Laws or which requires cleanup or corrective
action of any kind under any Environmental, Health and Safety Laws.
4.27 Certain Business Relationships With the Company.
Neither the Sellers nor any director or officer of the Company, nor any member
of their immediate families, nor any Affiliate of any of the foregoing, owns,
directly or indirectly, or has an ownership interest in (a) any business
(corporate or otherwise) which is a party to, or in any property which is the
subject of, any business arrangement or relationship of any kind with Company,
or (b) any business (corporate or otherwise) which conducts the same business
as, or a business similar to, that conducted by the Company.
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4.28 No Adverse Developments. There is no development
(exclusive of general economic factors affecting business in general) or, to
the Company's knowledge, threatened development affecting the Company (or
affecting customers, suppliers, employees, and other Persons which have
relationships with the Company) that (i) is having or may have a Material
Adverse Effect, or (ii) would prevent the Buyer from conducting the business of
the Company following the Closing in the manner in which it was conducted or
planned to be conducted prior to the Closing.
4.29 Full Disclosure. No representation or warranty in
this Section 4 or in any document delivered by Xxxx Xxxxxxxx, Xxxxxxxx Xxxxxxxx
or the Company pursuant to the transactions contemplated by this Agreement, and
no statement, list, certificate or instrument furnished to the Buyer pursuant
hereto or in connection with this Agreement contains any untrue statement of a
material fact, or omits to state any fact necessary to make any statement
herein or therein not materially misleading. There is no fact, development or
threatened development (excluding general economic factors affecting business
in general) which Xxxx Xxxxxxxx and Xxxxxxxx Xxxxxxxx have not disclosed to the
Buyer in writing and which is having or is likely to have a Material Adverse
Effect. Xxxx Xxxxxxxx, Xxxxxxxx Xxxxxxxx or the Company have delivered to the
Buyer true, correct and complete copies of all documents, including all
amendments, supplements and modifications thereof or waivers currently in
effect thereunder, described in the Company Disclosure Schedule.
5. Pre-Closing Covenants. With respect to the period between the
execution of this Agreement and the Closing:
5.1 General. Each of the Parties will use his, her or
its reasonable best efforts to take all action and to do all things necessary,
proper, or advisable in order to consummate and make effective the transactions
contemplated by this Agreement (including satisfaction, but not waiver, of the
closing conditions set forth in Section 7 below).
5.2 Notices and Consents. The Majority Shareholders will
cause the Company to give any notices to third parties and will cause the
Company to use its reasonable best efforts to obtain any third party consents,
that the Buyer reasonably may request in connection with the matters referred
to in Section 4.3 above. Each of the Parties will (and the Majority
Shareholders will cause the Company to) give any notices to, make any filings
with, and use its reasonable best efforts to obtain any authorizations,
consents, and approvals of governments and governmental agencies in connection
with the matters referred to in Section 3.1.2, Section 3.2.2 and Section 4.3
above. Without limiting the generality of the foregoing, the Buyer as an
"Acquiring Person" and the Company as an "Acquired Person" will file the
Notification and Report Forms and related material required by the Federal
Trade Commission and the Antitrust Division of the United States Department of
Justice under the Xxxx-Xxxxx-Xxxxxx Act, will use their reasonable best efforts
to obtain clearance either through early termination of the waiting period or
through lapse of the waiting period, and will make any further filings pursuant
thereto that may be necessary, proper, or advisable in connection therewith.
Notwithstanding the foregoing, nothing in this Section 5.2 shall be construed
to require any party to transfer or assign rights or other assets to a Person
who is not a Party.
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5.3 Operation of Business. The Majority Shareholders
will not cause or permit the Company to engage in any practice, take any
action, or enter into any transaction outside the Ordinary Course of Business.
Without limiting the generality of the foregoing, the Majority Shareholders
will not cause or permit the Company to (i) issue any capital stock or issue or
grant any options, warrants or rights to acquire any capital stock or (ii)
declare, set aside, or pay any dividend or make any distribution with respect
to its capital stock or redeem, purchase, or otherwise acquire any of its
capital stock, or (iii) otherwise engage in any practice, take any action, or
enter into any transaction of the sort described in Section 4.8 above. In
addition, the Majority Shareholders will cause the Company to comply with all
laws, statutes, ordinances, rules, regulations and orders applicable to it or
to the conduct of its business, except for violations that would not subject
the Company to a penalty or loss that would constitute a Material Adverse
Effect.
5.4 Preservation of Business. The Majority Shareholders
will cause the Company to keep its business and properties substantially
intact, including its present operations, physical facilities, working
conditions, and relationships with lessors, licensors, suppliers, customers,
and employees.
5.5 Access to Information; Due Diligence. Each of the
Majority Shareholders will cause the Company to permit the Buyer and its
representatives to have reasonable access at all reasonable times, and in a
manner so as not to interfere with the normal business operations of the
Company, to information sufficient to enable the Buyer to confirm the value of
the transactions contemplated hereby and to complete such governmental filings
and approvals as may be necessary to effect the transaction. At the Company's
request, the Parties will cooperate to restrict access to Confidential
Information to predesignated representatives of the Buyer. Neither such
access, inspection and furnishing of information to the Buyer and its
representatives, nor any investigation by the Buyer and its representatives,
shall in any way diminish or otherwise effect Buyer's right to rely on any
representation or warranty made by the Majority Shareholders or the other
Sellers hereunder. The Buyer and its representatives shall hold in strict
confidence any Confidential Information it or they receive from any of the
Sellers or the Company in the course of the due diligence investigation
contemplated by this Section 5.5, will not improperly utilize or disclose or
convey to any other Person such Confidential Information, and, if this
Agreement is terminated for any reason whatsoever, will return to the Majority
Shareholders and the Company all tangible embodiments (and all copies) of the
Confidential Information which are in its possession. Except as may be
required by law, the Buyer shall not disclose to any Person and shall not
permit any of the Buyer's representatives to disclose to any Person the
existence of this Agreement or any of the terms or provisions hereof.
5.6 Notice of Developments. The Majority Shareholders
will give prompt written notice to the Buyer of any material adverse
development causing a breach of any of the representations and warranties in
Section 4 above. Each Party will give prompt written notice to the others of
any material adverse development causing a breach of any of her or its own
representations and warranties in Section 3 above. No disclosure by any Party
pursuant to this Section 5.6, however, shall be deemed to amend or supplement
Sellers' Disclosure Schedule, the Company Disclosure Schedule or Buyer's
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Disclosure Schedule or to prevent or cure any misrepresentation, breach of
warranty, or breach of covenant.
5.7 Exclusivity. None of the Sellers will (and the
Majority Shareholders will not cause or permit the Company to) (i) solicit,
initiate, or encourage the submission of any proposal or offer from any Person
relating to the acquisition of any capital stock or other voting securities, or
any substantial portion of the assets, of the Company (including any
acquisition structured as a merger, consolidation, or share exchange) or (ii)
participate in any discussions or negotiations regarding, furnish any
information with respect to, assist or participate in, or facilitate in any
other manner any effort or attempt by any Person to do or seek any of the
foregoing. None of the Sellers will transfer or offer to transfer any of his,
her or its Company Shares. None of the Sellers will vote their Company Shares
in favor of any such acquisition structured as a merger, consolidation, or
share exchange.
6. Post-Closing Covenants. With respect to the period following
the Closing:
6.1 General. In case at any time after the Closing any
further action is necessary to carry out the purposes of this Agreement, each
of the Parties will take such further action (including the execution and
delivery of such further instruments and documents) as any other Party
reasonably may request, all at the sole cost and expense of the requesting
Party (unless the requesting Party is entitled to indemnification therefor
under Section 8 below). The Sellers acknowledge and agree that from and after
the Closing the Buyer will be entitled to possession of all documents, books,
records (including tax records), agreements, and financial data of any sort
relating to the Company.
6.2 Litigation Support. In the event and for so long as
any Party actively is contesting or defending against any action, suit,
proceeding, hearing, investigation, charge, complaint, claim, or demand in
connection with (i) any transaction contemplated under this Agreement or (ii)
any fact, situation, circumstance, status, condition, activity, practice, plan,
occurrence, event, incident, action, failure to act, or transaction (A) on or
prior to the Closing Date involving the Company or (B) arising out of the
Buyer's operation of the business of the Company following the Closing in the
manner in which it is presently conducted and planned to be conducted, each of
the other Parties will cooperate with him, her or it and his, her or its
counsel in the contest or defense, make available their personnel, and provide
such testimony and access to their books and records as shall be necessary in
connection with the contest or defense, all at the sole cost and expense of the
contesting or defending Party (unless the contesting or defending Party is
entitled to indemnification therefor under Section 8 below). Notwithstanding
the foregoing, each of Xxxx Xxxxxxxx and Xxxxxxxx Xxxxxxxx agrees that for a
period of three years following the Closing, such Party shall provide to Buyer
the assistance described in the preceding sentence at the sole expense of such
Party.
6.3 Transition. None of the Sellers nor Xxxx Xxxxxxxx or
Xxxxxxxx Xxxxxxxx will take any action that is designed or intended to have the
effect of discouraging any lessor, licensor, customer, supplier, or other
business associate of the Company from maintaining the same business
relationships with the Company after the Closing as it maintained with the
Company prior to the Closing.
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6.4 Confidentiality. Each of the Sellers and Xxxx
Xxxxxxxx and Xxxxxxxx Xxxxxxxx will treat and hold as such all of the
Confidential Information, refrain from using any of the Confidential
Information except in connection with this Agreement, and deliver promptly to
the Buyer or destroy, at the request and option of the Buyer, all tangible
embodiments (and all copies) of the Confidential Information which are in her
or its possession. In the event that any of the Sellers, Xxxx Xxxxxxxx or
Xxxxxxxx Xxxxxxxx is requested or required (by oral question or request for
information or documents in any legal proceeding, interrogatory, subpoena,
civil investigative demand, or similar process) to disclose any Confidential
Information, that Person will notify the Buyer promptly of the request or
requirement so that the Buyer may seek an appropriate protective order or waive
compliance with the provisions of this Section 6.4. If, in the absence of a
protective order or the receipt of a waiver hereunder, any of the Sellers, Xxxx
Xxxxxxxx, Xxxxxxxx Xxxxxxxx and directors and officers of the Company is, on
the advice of counsel, compelled to disclose any Confidential Information to
any tribunal or else stand liable for contempt, that Person may disclose the
Confidential Information to the tribunal; provided, however, that such
disclosing Person shall use his, her or its reasonable best efforts to obtain,
at the reasonable request of the Buyer, an order or other assurance that
confidential treatment will be accorded to such portion of the Confidential
Information required to be disclosed as the Buyer shall designate.
7. Conditions to Obligation to Close.
7.1 Conditions to the Buyer's Obligation to Close. The
obligation of the Buyer to consummate the transactions to be performed by it in
connection with the Closing is subject to satisfaction of the following
conditions:
7.1.1 the representations and warranties set forth
in Section 3.1 and Section 4 above (supplemented in the case of Section 4 by
the updated Company Disclosure Schedule permitted under Section 4) shall be
true and correct in all respects at and as of the Closing Date;
7.1.2 the Majority Shareholders, Xxxx Xxxxxxxx,
Xxxxxxxx Xxxxxxxx, the other Sellers and the Company shall have performed and
complied with all of their covenants hereunder in all respects through the
Closing, and all of the Sellers shall have tendered all of their Company Shares
to the Buyer at the Closing;
7.1.3 the Company shall have procured all of the
third party consents specified in Section 5.2 above;
7.1.4 no action, suit, or proceeding shall be
pending before any court or quasi-judicial or administrative agency of any
federal, state, local, or foreign jurisdiction or before any arbitrator wherein
an unfavorable injunction, judgment, order, decree, ruling, or charge would (A)
prevent consummation of any of the transactions contemplated by this Agreement,
(B) cause any of the transactions contemplated by this Agreement to be
rescinded following consummation, (C) affect materially and adversely the right
of the Buyer to own the Company Shares and to control the Company, or (D)
affect materially and adversely the right of the Company to own its assets
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(including without limitation its intellectual property assets) and to operate
its businesses (and no such injunction, judgment, order, decree, ruling or
charge shall be in effect) and no law, statute, ordinance, rule, regulation or
order shall have been enacted, enforced or entered which has caused or will
likely cause any of the effects under clause (A), (B), (C), or (D) of this
7.1.4 to occur.
7.1.5 Xxxx Xxxxxxxx and Xxxxxxxx Xxxxxxxx shall
have delivered to the Buyer a certificate to the effect that each of the
conditions specified above in Section 7.1.1 to Section 7.1.4 (inclusive) is
satisfied in all respects;
7.1.6 all applicable waiting periods (and any
extensions thereof) under the Xxxx-Xxxxx-Xxxxxx Act shall have expired or
otherwise been terminated and the Parties shall have received all other
authorizations, consents, and approvals of governments and governmental
agencies referred to in Section 3.1.2, Section 3.2.2, Section 4.3 above or
disclosed in a corresponding Section in Sellers' Disclosure Schedule, the
Company Disclosure Schedule or Buyer's Disclosure Schedule;
7.1.7 Xxxx Xxxxxxxx shall have executed and
delivered to the Company an Employment and Non-Competition Agreement
substantially identical in form and content to the form of agreement attached
hereto as Exhibit 7.1.7(a) (the "Employment Agreement") and Xxxxxxxx Xxxxxxxx
shall have executed and delivered to the Company a consulting agreement
substantially identical in form and content to the form of agreement attached
hereto as Exhibit 7.1.7(b), and such agreements shall be in full force and
effect;
7.1.8 the Buyer shall have received from counsel to
the Sellers an opinion in form and substance as set forth in Exhibit 7.1.8
attached hereto, addressed to the Buyer, and dated as of the Closing Date;
7.1.9 the Buyer shall have received the
resignations of the directors and officers of the Company, effective as of the
Closing;
7.1.10 A actions to be taken by the Sellers and the
Company in connection with consummation of the transactions contemplated hereby
and all certificates, opinions, instruments, and other documents required to
effect the transactions contemplated hereby will be reasonably satisfactory in
form and substance to the Buyer;
7.1.11 all of the conditions to the Buyer's
obligation to close under the Minority Shareholder Agreement shall have been
satisfied and such transaction shall have closed;
7.1.12 each Seller and each officer and director of
the Company shall have executed and delivered a general release of any claims
against the Company and its successors in the form attached hereto as Exhibit
7.1.12;
7.1.13 all disputes between the Company and third
parties shall have been resolved to the satisfaction of the Buyer.
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7.1.14 the Company shall deliver to Buyer a properly
executed statement conforming to the requirements of Treasury Regulation
Sections 1.897-2(h)(l)(i) and 1.1445-2(c)(3) and the Company further agrees to
provide the notification to the Internal Revenue Service required pursuant to
Treasury Regulation Section 1.897-2(h)(2).
The Buyer may waive any condition (in whole or in part)
specified in this Section 7 if it executes a writing so stating at or prior to
the Closing.
7.2 Conditions to the Sellers' Obligation. The
obligation of the Sellers to consummate the transactions to be performed by
them in connection with the Closing is subject to satisfaction of the following
conditions:
7.2.1 the representations and warranties set forth
in Section 3.2 above shall be true and correct in all respects at and as of the
Closing Date;
7.2.2 the Buyer shall have performed and complied
with all of its covenants hereunder in all respects through the Closing;
7.2.3 no action, suit, or proceeding shall be
pending before any court or quasi-judicial or administrative agency of any
federal, state, local, or foreign jurisdiction or before any arbitrator wherein
an unfavorable injunction, judgment, order, decree, ruling, or charge would
(A) prevent consummation of any of the transactions contemplated by this
Agreement or (B) cause any of the transactions contemplated by this Agreement
to be rescinded following consummation (and no such injunction, judgment,
order, decree, ruling, or charge shall be in effect) and no law, statute,
ordinance, rule, regulation or order shall have been enacted, enforced or
entered which has caused or will likely cause any of the effects under clause
(A) or (B) of this 7.2.3 to occur;
7.2.4 the Buyer shall have delivered to Xxxx
Xxxxxxxx and Xxxxxxxx Xxxxxxxx a certificate to the effect that each of the
conditions specified above in Section 7.2.1 to Section 7.2.3 (inclusive) is
satisfied in all respects;
7.2.5 all applicable waiting periods (and any
extensions thereof) under the Xxxx-Xxxxx-Xxxxxx Act shall have expired or
otherwise been terminated and the Parties shall have received all other
authorizations, consents, and approvals of governments and governmental
agencies referred to in Section 3.1.2, 3.2.2, and 4.3 above;
7.2.6 the Sellers shall have received from counsel
to the Buyer an opinion in form and substance as set forth in Exhibit 7.2.6
attached hereto, addressed to the Sellers, and dated as of the Closing Date;
7.2.7 all actions to be taken by the Buyer in
connection with consummation of the transactions contemplated hereby and all
certificates, opinions, instruments, and other
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documents required to effect the transactions contemplated hereby will be
reasonably satisfactory in form and substance to Xxxx Xxxxxxxx and Xxxxxxxx
Xxxxxxxx;
7.2.8 all of the conditions to the Sellers'
obligation to close under the Minority Shareholder Agreement shall have been
satisfied and such transaction shall have closed;
7.2.9 Xxxx Xxxxxxxx and Xxxxxxxx Xxxxxxxx shall
have been relieved of all obligations in their capacities as guarantors under
the Company's bank lines of credit and the Company's credit cards.
The Majority Shareholders may waive on behalf of all the
Sellers any condition specified in this Section 7.2 if they execute a writing
so stating at or prior to the Closing.
8. Remedies for Breaches of This Agreement.
8.1 Survival of Representations and Warranties. All of
the representations and warranties of the Parties contained in Sections 3
and 4 shall survive the Closing (even if the damaged Party knew or had reason
to know of any misrepresentation or breach of warranty at the time of Closing)
and continue in full force and effect for a period of one year following the
Closing. The covenants and agreements in this Agreement shall survive except
to the extent they are specifically limited by their terms.
8.2 Indemnification Provisions for Benefit of the Buyer.
8.2.1 In the event any of the Company, the Majority
Shareholders, Xxxx Xxxxxxxx and Xxxxxxxx Xxxxxxxx breaches any of his, her or
its representations, warranties, agreements or covenants contained herein,
other than representations and warranties contained in Section 3.1, provided
that the Buyer makes a written claim for indemnification pursuant to Section
10.7 below, then, subject to Sections 8.2.3 and 8.6 below, the Sellers agree,
jointly and severally, to indemnify, defend and hold harmless the Buyer
from and against the entirety of any and all actions, suits, proceedings,
hearings, investigations, charges, complaints, claims, demands, injunctions,
judgments, orders, decrees, rulings, damages, dues, penalties, fines, costs,
reasonable amounts paid in settlement, liabilities, obligations, taxes, liens,
losses, expenses, and fees, including court costs and reasonable attorneys'
fees and expenses ("Adverse Consequences") the Buyer may suffer through and
after the date of the claim for indemnification resulting from, arising out of,
relating to, in the nature of, or caused by the breach.
8.2.2 In the event any of the Sellers breaches any
of his, her or its representations and warranties contained in Section 3.1
hereof, provided that the Buyer makes a written claim for indemnification
against such Seller pursuant to Section 10.7 below, then the Seller
(severally and not jointly) agrees to indemnify, defend and hold harmless the
Buyer from and against the entirety of any Adverse Consequences the Buyer may
suffer through and after the date of the claim for indemnification resulting
from, arising out of, relating to, in the nature of, or caused by the breach.
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8.2.3 The Sellers shall not be required to
indemnify Buyer under this Section 8 except to the extent that the cumulative
amount of the Adverse Consequences actually incurred by the Buyer actually
exceeds $62,500, in which case the Sellers shall be obligated to indemnify
Buyer for the full amount of such Adverse Consequences (including the first
$62,500 in Adverse Consequences).
8.3 Procedure for Asserting Claims. If Buyer wishes to
assert a claim for indemnification pursuant to this Section 8, Buyer shall
prepare and deliver to the Sellers' Agent appointed pursuant to Section 10.16
of this Agreement a certificate signed by an officer of Adaptec (an "Officer's
Certificate") providing notice of such claim and specifying in reasonable
detail the date the Adverse Consequences relating to such claim were paid,
incurred or otherwise arose, and the nature of the misrepresentation or breach
to which such Adverse Consequences are related. Buyer shall act reasonably and
in good faith in preparing any such Officer's Certificate and in specifying any
alleged Adverse Consequences. If the Sellers' Agent disputes the claim,
Sellers' Agent shall notify Buyer of such disagreement within ten (10) days of
the receipt from Buyer of the Officer's Certificate, but in no event later than
the date twelve months after the Closing. Thereupon, Buyer and the Sellers'
Agent will, during the thirty (30) day period following delivery of the
Officer's Certificate, or the period remaining before the date twelve months
after the Closing, whichever is less, negotiate in good faith to resolve their
differences with respect to the claim. Upon the earlier of (1) the expiration
of such 30-day period or (2) the date twelve months after the Closing, Buyer
shall deduct the amount of the original claim or, if Buyer and the Sellers'
Agent have agreed on a different amount, reflected in a written memorandum
signed by both parties, such different amount from the final payment to be made
to the Sellers pursuant to Section 2.1.2 above. If the Sellers' Agent does not
object in the manner set forth above to the claim presented in the Officer's
Certificate, Buyer shall deduct the amount of the claim from the final payment
to be made to the Sellers pursuant to Section 2.1.2 above.
8.4 Matters Involving Third Parties.
8.4.1 If any third party shall notify any Buyer
(the "Indemnified Party") with respect to any matter (a "Third Party Claim")
which may give rise to a claim for indemnification against any Seller (the
"Indemnifying Party") under this Section 8, the Indemnified Party shall
promptly notify each Indemnifying Party thereof in writing; provided, however,
that no delay on the part of the Indemnified Party in notifying any
Indemnifying Party shall relieve the Indemnifying Party from any obligation
hereunder unless (and then solely to the extent) the Indemnifying Party thereby
is prejudiced.
8.4.2 The Indemnified Party may defend against, and consent to the
entry of any judgment or enter into any settlement with respect to, the Third
Party Claim in any manner such Indemnified Party reasonably may deem
appropriate (and such Indemnified Party need not consult with, or obtain any
consent from, any Indemnifying Party in connection therewith), and the
Indemnifying Parties will remain responsible for any Adverse Consequences the
Indemnified Party may suffer resulting from, arising out of, relating to, in
the nature of, or caused by the Third Party Claim to the fullest extent
provided in this Section 8. Notwithstanding the foregoing sentence, counsel
for
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any Indemnifying Party shall be permitted to monitor the Indemnified Party's
defense of a Third Party Claim for the purpose of advising the Indemnifying
Party of the status and progress of the defense. Any such activity shall be at
the sole expense of the Indemnifying Party.
8.5 No Indemnity for Corporate Agents. Each of the
Sellers hereby agrees that such Seller will not make any claim for
indemnification against the Company by reason of the fact that such Seller was
a director, officer, employee, or agent of any such entity or was serving at
the request of any such entity as a partner, trustee, director, officer,
employee, or agent of another entity (whether such claim is for judgments,
damages, penalties, fines, costs, amounts paid in settlement, losses, expenses,
or otherwise and whether such claim is pursuant to any statute, charter
document, bylaw, agreement, or otherwise) with respect to any action, suit,
proceeding, complaint, claim, or demand brought by the Buyer against such
Seller (whether such action, suit, proceeding, complaint, claim, or demand is
pursuant to this Agreement, applicable law, or otherwise).
8.6 Exclusivity of Remedy. Except as provided in the
next sentence, the Buyer's sole recourse against the Sellers following the
Closing for any breach by any Seller, Xxxx Xxxxxxxx, Xxxxxxxx Xxxxxxxx or the
Company of any representation, warranty, agreement or covenant contained herein
shall be the indemnification provided for under this Section 8 for a period of
one year following the Closing which shall be satisfied, subject to Section 8.3
above, by setting off the amount of any claims against the final payment to the
Sellers set forth in Section 2.1.2 of this Agreement. Notwithstanding the
preceding sentence, in the event of fraud or Gross Negligence on the part of
either Xxxx Xxxxxxxx, Xxxxxxxx Xxxxxxxx or the Company in connection with the
transactions contemplated by this Agreement, Buyer shall have all available
remedies under the law against such Parties and recourse shall not be limited
as provided in the preceding sentence.
9. Termination.
9.1 Termination of the Agreement. Certain of the Parties
may terminate this Agreement as provided below:
9.1.1 the Buyer and the Majority Shareholders may
terminate this Agreement as to all Parties by mutual written consent at any
time prior to the Closing;
9.1.2 the Buyer may terminate this Agreement by
giving written notice to the Majority Shareholders at any time prior to the
Closing (A) in the event any of the Sellers has breached any representation,
warranty, or covenant contained in this Agreement in any respect, the Buyer has
notified the Majority Shareholders of the breach, and the breach has continued
without cure for a period of thirty (30) days after the notice of breach or (B)
if the Closing shall not have occurred on or before July 14, 1995, by reason of
the failure of any condition precedent under Section 7.1 hereof (unless the
failure results primarily from the Buyer itself breaching any representation,
warranty, or covenants contained in this Agreement); and
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35
9.1.3 the Majority Shareholders may terminate this
Agreement by giving written notice to the Buyer at any time prior to the
Closing (A) in the event the Buyer has breached any representation, warranty,
or covenant contained in this Agreement in any respect, any of the Majority
Shareholders has notified the Buyer of the breach, and the breach has continued
without cure for a period of 30 days after the notice of breach or (B) if the
Closing shall not have occurred on or before July 14, 1995, by reason of the
failure of any condition precedent under Section 7.2 hereof (unless the failure
results primarily from any of the Sellers themselves breaching any
representation, warranty, or covenant contained in this Agreement).
9.2 Effect of Termination. If any Party terminates this
Agreement pursuant to Section 9.1 above, all rights and obligations of the
Parties hereunder shall terminate without any liability of any Party to any
other Party (except for any liability of any Party then in breach); provided,
however, that the confidentiality provisions contained in Section 5.5 above
shall survive termination.
10. Miscellaneous.
10.1 Press Releases and Public Announcements. No Party
shall issue any press release or make any public announcement relating to the
subject matter of this Agreement prior to the Closing without the prior written
approval of the Buyer and the Majority Shareholders; provided, however, that
any Party may make any public disclosure it believes in good faith is required
by applicable law or any listing or trading agreement concerning its
publicly-traded securities (in which case the disclosing Party will use its
reasonable best efforts to advise the other Parties prior to making the
disclosure).
10.2 No Third-Party Beneficiaries. This Agreement shall
not confer any rights or remedies upon any Person other than the Parties and
their respective successors and permitted assigns.
10.3 Entire Agreement. This Agreement (including the
documents referred to herein) constitutes the entire agreement among the
Parties and supersedes any prior understandings, agreements, or representations
by or among the Parties, written or oral, to the extent they related in any way
to the subject matter hereof.
10.4 Succession and Assignment. This Agreement shall be
binding upon and inure to the benefit of the Parties named herein and their
respective successors and permitted assigns. No Party may assign either this
Agreement or any of her or its rights, interests, or obligations hereunder
without the prior written approval of the Buyer and the Majority Shareholders;
provided, however, that the Buyer may (i) assign any or all of its rights and
interests hereunder to one or more of its Affiliates and (ii) designate one or
more of its Affiliates to perform its obligations hereunder (in any or all of
which cases the Buyer nonetheless shall remain responsible for the performance
of all of its obligations hereunder).
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10.5 Counterparts. This Agreement may be executed in one
or more counterparts, each of which shall be deemed an original but all of
which together will constitute one and the same instrument.
10.6 Headings. The section headings contained in this
Agreement are inserted for convenience only and shall not affect in any way the
meaning or interpretation of this Agreement.
10.7 Notices. All notices, requests, demands, claims,
and other communications hereunder will be in writing. Any notice, request,
demand, claim, or other communication hereunder shall be deemed duly given if
(and then two business days after) it is sent by registered or certified mail,
return receipt requested, postage prepaid and addressed to the intended
recipient as set forth below:
If to the Sellers:
Xxxx X. Xxxxxxxx and Xxxxxxxx X. Xxxxxxxx
X.X. Xxx 0000-000
Xxxxxxx Xxxxx, XX 00000
Copy to:
Xxxxxx Godward Xxxxxx Xxxxxxxxx & Xxxxx
0000 Xxxxxxxxx Xxxxx, Xxxxx 0000
Xxx Xxxxx, XX 00000
Attention: Xxxxxxxxx X. Xxxx, Esq.
If to the Buyer:
Adaptec, Inc.
000 X. Xxxxxxxx Xxxx.
Xxxxxxxx, XX 00000
Attention: Xxxxxxxxxxx X. O'Xxxxx
Xxxxxx Xxxxx Xxxxx, Esq.
Copy to:
Wilson, Sonsini, Xxxxxxxx & Xxxxxx
Professional Corporation
000 Xxxx Xxxx Xxxx
Xxxx Xxxx, Xxxxxxxxxx 00000-0000
Attention: Xxxxx X. Xxxxxx, Xx., Esq.
Any Party may send any notice, request, demand, claim, or other communication
hereunder to the intended recipient at the address set forth above using any
other means (including personal delivery, expedited courier, messenger
service, telecopy, telex, ordinary mail, or electronic mail), but no such
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notice, request, demand, claim, or other communication shall be deemed to have
been duly given unless and until it actually is received by the intended
recipient. Any Party may change the address to which notices, requests,
demands, claims, and other communications hereunder are to be delivered by
giving the other Parties notice in the manner herein set forth.
10.8 Governing Law. This Agreement shall be governed by
and construed in accordance with the domestic laws of the State of California
without giving effect to any choice or conflict of law provision or rule
(whether of the State of California or any other jurisdiction) that would cause
the application of the laws of any jurisdiction other than the State of
California.
10.9 Forum Selection; Consent to Jurisdiction. All
disputes arising out of or in connection with this Agreement shall be solely
and exclusively resolved by a court of competent jurisdiction in the State of
California. The parties hereby consent to the jurisdiction of the Superior
Court of the State of California and the United States District Courts of
California and waive any objections or rights as to forum nonconveniens, lack
of personal jurisdiction or similar grounds with respect to any dispute
relating to this Agreement.
10.10 Amendments and Waivers. No amendment of any
provision of this Agreement shall be valid unless the same shall be in writing
and signed by the Buyer and the Majority Shareholders. No waiver by any Party
of any default, misrepresentation, or breach of warranty or covenant hereunder,
whether intentional or not, shall be deemed to extend to any prior to
subsequent default, misrepresentation, or breach of warranty or covenant
hereunder or affect in any way any rights arising by virtue of any prior or
subsequent occurrence.
10.11 Severability. Any term or provision of this
Agreement that is invalid or unenforceable in any situation in any jurisdiction
shall not affect the validity or enforceability of the remaining terms and
provisions hereof or the validity or enforceability of the offending term or
provision in any other situation or in any other jurisdiction.
10.12 Expenses. Each of the Sellers and the Buyer will
bear her or its own costs and expenses (including legal fees and expenses)
incurred in connection with this Agreement and the transactions contemplated
hereby. The Sellers will bear, pro rata, any and all costs and expenses of the
Company (including any of its legal fees and expenses) in connection with this
Agreement or any of the transactions contemplated hereby. To the extent that
the amounts paid at the Closing under clauses (iii)(A) and (B) of Section 2.3
of this Agreement are insufficient to satisfy the obligations of the Sellers
and the Company to the respective payees, the Sellers shall pay any deficiency.
10.13 Transfer Taxes. Each Seller shall pay all sales,
use, stamp, transfer and like taxes, if any, required to be paid in connection
with the transfer of her or its Company Shares hereunder.
10.14 Construction. The Parties have participated jointly
in the negotiation and drafting of this Agreement. In the event an ambiguity
or question of intent or interpretation arises,
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this Agreement shall be construed as if drafted jointly by the Parties and no
presumption or burden of proof shall arise favoring or disfavoring any Party by
virtue of the authorship of any of the provisions of this Agreement. Any
reference to any federal, state, local, or foreign statute or law shall be
deemed also to refer to all rules and regulations promulgated thereunder,
unless the context requires otherwise. The word "including" shall mean
including without limitation.
10.15 Incorporation of Exhibits and Schedules. The
Exhibits and Schedules identified in this Agreement are incorporated herein by
reference and made a part hereof.
10.16 Sellers' Representative. The Sellers hereby appoint
Xxxxxxxx Xxxxxxxx as their agent and representative (the "Sellers' Agent") for
the purposes of: (i) representing, acting for and binding each of them for all
purposes of this Agreement and the Escrow Agreement, including without
limitation, the settlement of any controversies or disagreements between Buyer
and Sellers hereunder; (ii) receiving or giving any notices to or from Sellers
hereunder; and (iii) communicating with the Buyer or the Company as to any
matters relating to this Agreement. In the event Xxxxxxxx Xxxxxxxx is unable,
unwilling or unavailable to serve as Sellers' Representative, the Sellers
hereby appoint Xxxx Xxxxxxxx to serve in such capacity, if he is able, willing
and available, and if not, someone appointed to serve in such capacity by
holders of 51% of the voting power of the Company immediately prior to Closing.
The Buyer shall be entitled to presumptively rely without further inquiry upon
all acts of, and communications from, the Sellers' Agent as being the
authorized actions and communications of the Sellers' Agent as approved by the
Sellers. The Sellers' Agent shall be entitled to take binding action on behalf
of the Sellers upon obtaining the approval of such Sellers who immediately
prior to the Closing owned at least 51% of the voting power of the Company.
Each Seller hereby further agrees that he will indemnify and hold harmless the
Sellers' Agent for any and all actions taken by the Sellers' Agent under the
provisions of this Section 10.16.
10.17 Attorneys' Fees. If any legal proceeding or other
action for fraud or Gross Negligence relating to this Agreement is brought or
otherwise initiated, the prevailing party shall be entitled to recover
reasonable attorneys fees, costs and disbursements (in addition to any other
relief to which the prevailing party may be entitled).
11. Location of Definitions. The following table sets forth the
Sections of this Agreement in which certain terms are defined:
Term Section
---- -------
Adverse Consequences 8.2.1
Affiliate 1
Affiliated Group 4.11.4
Buyer Preamble
Buyer's Disclosure Schedule 3.2
Closing 2.2
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Term Section
---- -------
Closing Date 2.2
Code 4.11.3
Company Preamble
Company Disclosure Schedule 4
Company Shares 2.1
Confidential Information 1
Controlled Group of Corporations 4.24.2
Employee Benefit Plan 1
Employee Pension Benefit Plan 1
Employee Welfare Benefit Plan 1
Employment Agreement 7.1.7
Environmental Health and Safety Laws 4.26.1
ERISA 1
Extremely Hazardous Substance 4.26.1
Fiduciary 4.24.2.1
Financial Statements 4.5
Xxxx-Xxxxx Xxxxxx Act 2.4
Hazardous Material 4.26.1
Indemnified or Indemnifying Party 8.4.1
Intellectual Property 1
Majority Shareholders 1
Minority Shareholder Agreement Recitals
Most Recent Balance Sheet 4.7
Most Recent Financial Statements 4.5
Most Recent Fiscal Year End 4.5
Multiemployer Plan 1
Ordinary Course of Business 1
Party or Parties Preamble
Person 1
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Term Section
---- -------
Securities Act 3.2.5
Security Interest 1
Seller Preamble
Sellers' Disclosure Schedule 3.1
Subsidiary 4.6
Taxes 4.11.1
Tax Returns 4.11.2
Third Party Claim 8.4.1
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IN WITNESS WHEREOF, the Parties hereto have executed this Agreement on
as of the date first above written.
SIGNATURE GUARANTEED FUTURE DOMAIN CORPORATION
MEDALLION GUARANTEED
XXXXX FARGO BANK, N.A. By: /s/ XXXX X. XXXXXXXX
------------------------------------------
/s/ ? XXXXXX Title: CEO
---------------------- ---------------------------------------
SIGNATURE GUARANTEED ADAPTEC, INC.
MEDALLION GUARANTEED
XXXXX FARGO BANK, N.A. By:
------------------------------------------
/s/ ? XXXXXX Title:
---------------------- ---------------------------------------
SIGNATURE GUARANTEED /s/ XXXX X. XXXXXXXX
MEDALLION GUARANTEED ---------------------------------------------
XXXXX FARGO BANK, N.A. Xxxx X. Xxxxxxxx
/s/ ? XXXXXX /s/ XXXXXXXX X. XXXXXXXX
---------------------- ---------------------------------------------
Xxxxxxxx X. Xxxxxxxx
SIGNATURE GUARANTEED
MEDALLION GUARANTEED /s/ XXXX X. XXXXXXXX XXXXXXXX X. XXXXXXXX
XXXXX FARGO BANK, N.A. ---------------------------------------------
Xxxx X. Xxxxxxxx and Xxxxxxxx X. Xxxxxxxx,
/s/ ? XXXXXX As Trustees for the Xxxxxxxx Family Trust
----------------------
/s/ XXXX X. XXXXXXXX XXXXXXXX X. XXXXXXXX
SIGNATURE GUARANTEED ---------------------------------------------
MEDALLION GUARANTEED Xxxx X. Xxxxxxxx and Xxxxxxxx X. Xxxxxxxx,
XXXXX FARGO BANK, N.A. As Trustees for the Xxxxxxxx Charitable
Remainder Trust
/s/ ? XXXXXX
----------------------
SUMMIT VENTURES, L. P.
By:
-----------------------------------
Title:
--------------------------------
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IN WITNESS WHEREOF, the Parties hereto have executed this Agreement on
as of the date first above written.
FUTURE DOMAIN CORPORATION
By:
------------------------------------------
Title:
---------------------------------------
ADAPTEC, INC.
By: /s/ X. XXXXXXXXX
------------------------------------------
Title: Vice President and General Manager
---------------------------------------
---------------------------------------------
Xxxx X. Xxxxxxxx
---------------------------------------------
Xxxxxxxx X. Xxxxxxxx
---------------------------------------------
Xxxx X. Xxxxxxxx and Xxxxxxxx X. Xxxxxxxx,
As Trustees for the Xxxxxxxx Family Trust
---------------------------------------------
Xxxx X. Xxxxxxxx and Xxxxxxxx X. Xxxxxxxx,
As Trustees for the Xxxxxxxx Charitable
Remainder Trust
SUMMIT VENTURES, L. P.
By:
-----------------------------------
Title:
--------------------------------
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IN WITNESS WHEREOF, the Parties hereto have executed this Agreement on
as of the date first above written.
FUTURE DOMAIN CORPORATION
By:
------------------------------------------
Title:
---------------------------------------
ADAPTEC, INC.
By:
------------------------------------------
Title:
---------------------------------------
---------------------------------------------
Xxxx X. Xxxxxxxx
---------------------------------------------
Xxxxxxxx X. Xxxxxxxx
---------------------------------------------
Xxxx X. Xxxxxxxx and Xxxxxxxx X. Xxxxxxxx,
As Trustees for the Xxxxxxxx Family Trust
---------------------------------------------
Xxxx X. Xxxxxxxx and Xxxxxxxx X. Xxxxxxxx,
As Trustees for the Xxxxxxxx Charitable
Remainder Trust
SUMMIT VENTURES, L. P.
By: /s/ XXXXX X. XXXX
-----------------------------------
Title: Managing Partner
--------------------------------
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SUMMIT VENTURES II, L.P.
By: /s/ XXXXX X. XXXX
---------------------------------------
Title: G.P.
------------------------------------
SV EUROFUND, C. V.
By: /s/ XXXXX X. XXXX
---------------------------------------
Title: G.P.
------------------------------------
SUMMIT INVESTORS, L. P.
By: /s/ XXXXX X. XXXX
---------------------------------------
Title: G.P.
------------------------------------
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EXHIBIT 3.2
BUYER'S DISCLOSURE SCHEDULE
No exceptions.
