ASSET PURCHASE AGREEMENT
BETWEEN
XXXXXXXXX.XXX, INC.
AND
ACTIVE VOICE CORPORATION
JUNE 30, 1999
TABLE OF CONTENTS
PAGE
1. Definitions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .1
2. Basic Transaction . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .4
(a) Purchase and Sale of Assets. . . . . . . . . . . . . . . . . . . . . . . .4
(b) Assumption of Liabilities. . . . . . . . . . . . . . . . . . . . . . . . .5
(c) Purchase Price . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .5
(d) The Closing. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .5
(e) Deliveries at the Closing. . . . . . . . . . . . . . . . . . . . . . . . .5
(f) Allocation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .5
3. Representations and Warranties of the Seller. . . . . . . . . . . . . . . . . .5
(a) Organization of the Seller . . . . . . . . . . . . . . . . . . . . . . . .5
(b) Authorization of Transaction . . . . . . . . . . . . . . . . . . . . . . .6
(c) Noncontravention . . . . . . . . . . . . . . . . . . . . . . . . . . . . .6
(d) Brokers' Fees. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .6
(e) Title to Assets. . . . . . . . . . . . . . . . . . . . . . . . . . . . . .6
(f) Subsidiaries . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .6
(g) Financial Statements . . . . . . . . . . . . . . . . . . . . . . . . . . .6
(h) Legal Compliance . . . . . . . . . . . . . . . . . . . . . . . . . . . . .7
(i) Tax Matters. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .7
(j) Complete Codebase. . . . . . . . . . . . . . . . . . . . . . . . . . . . .7
(k) Intellectual Property. . . . . . . . . . . . . . . . . . . . . . . . . . .7
(l) Contracts. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .9
(m) Powers of Attorney . . . . . . . . . . . . . . . . . . . . . . . . . . . 10
(n) Litigation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10
(o) Product Warranty . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10
(p) Product Liability. . . . . . . . . . . . . . . . . . . . . . . . . . . . 10
(q) Employees. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10
(r) Disclaimer . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10
4. Representations and Warranties of the Buyer . . . . . . . . . . . . . . . . . 11
(a) Organization of the Buyer. . . . . . . . . . . . . . . . . . . . . . . . 11
(b) Authorization of Transaction . . . . . . . . . . . . . . . . . . . . . . 11
(c) Noncontravention . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11
(d) Brokers' Fees. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11
(e) Financial Statements . . . . . . . . . . . . . . . . . . . . . . . . . . 11
5. Post-Closing Covenants. . . . . . . . . . . . . . . . . . . . . . . . . . . . 12
(a) General. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 12
(b) Litigation Support . . . . . . . . . . . . . . . . . . . . . . . . . . . 12
(c) Transition . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 12
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TABLE OF CONTENTS
(CONTINUED)
(d) Confidentiality. . . . . . . . . . . . . . . . . . . . . . . . . . . . . 12
(e) Covenant Not to Solicit Employees. . . . . . . . . . . . . . . . . . . . 13
6. Conditions to Obligation to Close . . . . . . . . . . . . . . . . . . . . . . 13
(a) Conditions to Obligation of the Buyer. . . . . . . . . . . . . . . . . . 13
(b) Conditions to Obligation of the Seller . . . . . . . . . . . . . . . . . 14
7. Remedies for Breaches of This Agreement . . . . . . . . . . . . . . . . . . . 15
(a) Survival of Representations and Warranties . . . . . . . . . . . . . . . 15
(b) Indemnification Provisions for Benefit of the Buyer. . . . . . . . . . . 15
(c) Indemnification Provisions for Benefit of the Seller . . . . . . . . . . 15
(d) Limitations on Indemnification Claims. . . . . . . . . . . . . . . . . . 15
(e) Matters Involving Third Parties. . . . . . . . . . . . . . . . . . . . . 16
(f) Determination of Adverse Consequences. . . . . . . . . . . . . . . . . . 17
(g) Other Indemnification Provisions . . . . . . . . . . . . . . . . . . . . 17
8. Miscellaneous . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 17
(a) Press Releases and Public Announcements. . . . . . . . . . . . . . . . . 17
(b) No Third-Party Beneficiaries . . . . . . . . . . . . . . . . . . . . . . 17
(c) Entire Agreement . . . . . . . . . . . . . . . . . . . . . . . . . . . . 17
(d) Succession and Assignment. . . . . . . . . . . . . . . . . . . . . . . . 18
(e) Counterparts . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 18
(f) Headings . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 18
(g) Notices. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 18
(h) Governing Law. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 19
(i) Amendments and Waivers . . . . . . . . . . . . . . . . . . . . . . . . . 19
(j) Severability . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 19
(k) Expenses . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 20
(l) Construction . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 20
(m) Incorporation of Exhibits and Schedules. . . . . . . . . . . . . . . . . 20
(n) Specific Performance . . . . . . . . . . . . . . . . . . . . . . . . . . 20
(o) Submission to Jurisdiction . . . . . . . . . . . . . . . . . . . . . . . 20
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ASSET PURCHASE AGREEMENT
This Agreement is entered into as of June 30, 1999, by and between
XxxxXxxxx.xxx, Inc., a Delaware corporation (the "BUYER"), and Active Voice
Corporation, a Washington corporation (the "SELLER"). The Buyer and the
Seller are referred to collectively herein as the "PARTIES".
This Agreement contemplates a transaction in which the Buyer will
purchase all of the assets (and assume certain of the liabilities) related to
the MyAgent Product of the Seller in return for cash.
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.
1. DEFINITIONS.
"ACQUIRED ASSETS" means all right, title, and interest in and to all
of the assets specifically listed as "Acquired Assets" in the Disclosure
Schedule, INCLUDING, with respect to such assets, all (a) Intellectual
Property therein, goodwill associated therewith, licenses and sublicenses
granted (including any beta end user licenses in the form attached hereto as
Exhibit 1.1) and obtained with respect thereto, and rights thereunder,
remedies against infringements thereof, and rights to protection of interests
therein under the laws of all jurisdictions, (b) listed agreements,
contracts, indentures, mortgages, instruments, Security Interests,
guaranties, other similar arrangements, and rights thereunder, (c) claims,
deposits, prepayments, refunds, causes of action, choses in action, rights of
recovery, rights of set off, and rights of recoupment, (d) listed franchises,
approvals, permits, licenses, orders, registrations, certificates, variances,
and similar rights obtained from governments and governmental agencies, and
(e) listed books, records, ledgers, files, documents, correspondence, lists,
drawings, and specifications, creative materials, advertising and promotional
materials, studies, reports, and other printed or written materials;
PROVIDED, HOWEVER, that the Acquired Assets shall not include (i) the
corporate charter, qualifications to conduct business as a foreign
corporation, arrangements with registered agents relating to foreign
qualifications, taxpayer and other identification numbers, seals, minute
books, stock transfer books, blank stock certificates, and other documents
relating to the organization, maintenance, and existence of the Seller as a
corporation, (ii) any of the rights of the Seller under this Agreement (or
under any side agreement including but not limited to the License Agreement
between the Seller on the one hand and the Buyer on the other hand entered
into on or after the date of this Agreement) or (iii) any of the assets not
specifically listed as "Acquired Assets" in the Disclosure Schedule.
"ADVERSE CONSEQUENCES" means all actions, suits, proceedings,
hearings, investigations, charges, complaints, claims, demands, injunctions,
judgments, orders, decrees, rulings, damages, dues, penalties, fines, costs,
amounts paid in settlement, Liabilities, obligations, Taxes, liens, losses,
expenses, and fees, including court costs and reasonable attorneys' fees and
expenses.
"AFFILIATE" has the meaning set forth in Rule 12b-2 of the regulations
promulgated under the Securities Exchange Act.
"APPLICABLE RATE" means the corporate base rate of interest publicly
announced from time to time by Bank of America.
"ASSUMED LIABILITIES" shall only consist of the obligations under the
agreements, contracts, leases, licenses, and other arrangements referred to
in the definition of Acquired Assets and specifically listed on the Schedule
of Assumed Liabilities. In no event shall the Assumed Liabilities include
(i) any Liability of the Seller for any Taxes incurred for periods prior to
the Closing, including in the case of real or personal property Taxes
attributable to the Acquired Assets that portion of such Taxes allocable to
the period (or portion thereof) ending on or prior to the Closing Date, (ii)
any Liability of the Seller for income, transfer, sales, use, and other Taxes
arising in connection with the consummation of the transactions contemplated
hereby (including any income Taxes arising because the Seller is transferring
the Acquired Assets, (iii) any Liability of the Seller for the unpaid Taxes
of any Person other than the Seller, as a transferee or successor, by
contract or otherwise, (iv) any obligation of the Seller to indemnify any
Person by reason of the fact that such Person was a director, officer,
employee, or agent of the Seller or was serving at the request of the Seller
as a partner, trustee, director, officer, employee, or agent of another
entity (whether such indemnification is for judgments, damages, penalties,
fines, costs, amounts paid in settlement, losses, expenses, or otherwise and
whether such indemnification is pursuant to any statute, charter document,
bylaw, agreement, or otherwise), (v) any Liability of the Seller for costs
and expenses incurred in connection with this Agreement and the transactions
contemplated hereby, or (vi) any Liability or obligation of the Seller under
this Agreement (or under any side agreement between the Seller on the one
hand and the Buyer on the other hand entered into on or after the date of
this Agreement).
"BASIS" means any past or present fact, situation, circumstance,
status, condition, activity, practice, plan, occurrence, event, incident,
action, failure to act, or transaction that forms or could form the basis for
any specified consequence.
"BUYER" has the meaning set forth in the preface above.
"CLOSING" has the meaning set forth in Section 2(d) below.
"CLOSING DATE" has the meaning set forth in Section 2(d) below.
"CODE" means the Internal Revenue Code of 1986, as amended.
"CONFIDENTIAL INFORMATION" means any information concerning the
products, businesses and affairs of the other Party that is not already
generally available to the public; provided, however that Confidential
Information shall not include information that is independently developed by
the receiving party or that becomes known to the receiving party from a
source other than the disclosing
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party under circumstances not involving any breach of any confidentiality
obligation between the source and the disclosing party. Notwithstanding the
foregoing, the Acquired Assets shall be deemed Confidential Information of
the Buyer.
"DISCLOSURE SCHEDULE" has the meaning set forth in Section 3 below.
"FINANCIAL STATEMENTS" has the meaning set forth in Section 3(g) below.
"GAAP" means United States generally accepted accounting principles as
in effect from time to time.
"INDEMNIFIED PARTY" has the meaning set forth in Section 7(e) below.
"INDEMNIFYING PARTY" has the meaning set forth in Section 7(e) below.
"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, domain names and corporate
names, together with all translations, adaptations, derivations, and
combinations thereof and including all goodwill associated therewith, and all
applications, registrations, and renewals in connection therewith, (c) all
copyrightable works, all copyrights, and all applications, registrations, and
renewals in connection therewith, (d) all mask works 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, manufacturing and production
processes and techniques, technical data, designs, drawings, specifications,
customer and supplier lists, pricing and cost 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) (provided that
the Seller may retain copies and tangible embodiments for purposes allowed by
the License Agreement).
"KEY EMPLOYEES" means Xxxxx Xxxx, Dillana Lim, Xxxxx Xxxxxxxxx, Xxxxx
Xxxx, Xxxxx Xxxxx and Xxxxx Xxxxx.
"KNOWLEDGE" means actual knowledge after reasonable investigation.
"LIABILITY" means any 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.
"LICENSE AGREEMENT" means the license agreement, in substantially the
form attached hereto as Exhibit 1.2, to be entered into by and between the
Buyer and the Seller.
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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).
"PARTY" has the meaning set forth in the preface above.
"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).
"PURCHASE PRICE" has the meaning set forth in Section 2(c) below.
"SECURITIES EXCHANGE ACT" means the Securities Exchange Act of 1934,
as amended.
"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.
"SELLER" has the meaning set forth in the preface above.
"SELLER STOCKHOLDER" means any person who or which holds any capital
stock of Seller.
"SUBSIDIARY" means any corporation with respect to which a specified
Person (or a Subsidiary thereof) owns a majority of the common stock or has
the power to vote or direct the voting of sufficient securities to elect a
majority of the directors.
"TAX" means any federal, state, local, or foreign income, gross
receipts, license, payroll, employment, excise, severance, stamp, occupation,
premium, windfall profits, environmental (including taxes under Code Section
59A), customs duties, capital stock, franchise, profits, withholding, social
security (or similar), unemployment, disability, real property, personal
property, sales, use, transfer, registration, value added, alternative or
add-on minimum, estimated, or other tax of any kind whatsoever, including any
interest, penalty, or addition thereto, whether disputed or not.
"THIRD PARTY CLAIM" has the meaning set forth in Section 7(e) below.
2. BASIC TRANSACTION.
(a) PURCHASE AND SALE OF ASSETS. On and subject to the
terms and conditions of this Agreement, and the necessary condition
concurrent of valid execution and delivery of the License Agreement, the
Buyer agrees to purchase from the Seller, and the Seller agrees to sell,
transfer, convey, and deliver to the Buyer, all of the Acquired Assets at the
Closing for the consideration specified below in this Section 2.
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(b) ASSUMPTION OF LIABILITIES. On and subject to the terms
and conditions of this Agreement, the Buyer agrees to assume and become
responsible for all of the Assumed Liabilities at the Closing. The Buyer
will not assume or have any responsibility, however, with respect to any
other obligation or Liability of the Seller not included within the
definition of Assumed Liabilities.
(c) PURCHASE PRICE. The Buyer agrees to pay to the Seller
at the Closing Eighteen Million Dollars ($18,000,000) (the "Purchase Price")
by delivery of cash payable by wire transfer or delivery of other immediately
available funds.
(d) THE CLOSING. The closing of the transactions
contemplated by this Agreement (the "Closing") shall take place at the
offices of Xxxxxx Xxxxxxx Xxxxxxxx & Xxxxxx, Professional Corporation, in
Kirkland, Washington, commencing at 9:00 a.m. local time on June 30, 1999 or
such other date or time as the Parties may mutually determine (the "Closing
Date").
(e) DELIVERIES AT THE CLOSING. At the Closing, (i) the
Seller will deliver to the Buyer the various certificates, instruments, and
documents referred to in Section 6(a) below (including, without limitation,
the License Agreement); (ii) the Buyer will deliver to the Seller the various
certificates, instruments, and documents referred to in Section 6(b) below
(including, without limitation, the License Agreement); (iii) the Seller will
execute, acknowledge (if appropriate), and deliver to the Buyer (A)
assignments (including Intellectual Property transfer documents) in the forms
attached hereto as Exhibits 2.1, 2.1(b), 2.2, 2.3 and 2.4 and (B) such other
instruments of sale, transfer, conveyance, and assignment as the Buyer and
its counsel reasonably may request; (iv) the Seller will deliver to the Buyer
all tangible forms of the Intellectual Property included within the Acquired
Assets; (v) the Buyer will execute, acknowledge (if appropriate), and deliver
to the Seller (A) an assumption in the form attached hereto as Exhibit 2.5
and (B) such other instruments of assumption as the Seller and its counsel
reasonably may request; and (vi) the Buyer will deliver to the Seller the
consideration specified in Section 2(c) above.
(f) ALLOCATION. The Parties agree to allocate the Purchase
Price (and all other capitalizable costs) among the Acquired Assets for all
purposes (including financial accounting and tax purposes) in accordance with
the allocation schedule determined by a third party retained by the Buyer to
determine such allocation.
3. REPRESENTATIONS AND WARRANTIES OF THE SELLER. The Seller
represents and warrants to the Buyer that the statements contained in this
Section 3 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), except as set forth in the disclosure schedule
accompanying this Agreement and initialed by the Parties (the Disclosure
Schedule). The Disclosure Schedule will be arranged in paragraphs
corresponding to the lettered and numbered paragraphs contained in this
Section 3.
(a) ORGANIZATION OF THE SELLER. The Seller is a corporation
duly organized, validly existing, and in good standing under the laws of the
jurisdiction of its incorporation.
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(b) AUTHORIZATION OF TRANSACTION. The Seller has full power
and authority (including full corporate power and authority) to execute and
deliver this Agreement and to perform its obligations hereunder. Without
limiting the generality of the foregoing, the board of directors of the
Seller has duly authorized the execution, delivery, and performance of this
Agreement by the Seller, and the approval of the Seller Stockholders is not
required by any applicable statute, law, rule or regulation in order for the
Seller to execute and deliver this Agreement and to perform its obligations
pursuant to this Agreement. This Agreement constitutes the valid and legally
binding obligation of the Seller, enforceable in accordance with its terms
and conditions.
(c) NONCONTRAVENTION. Neither the execution and the
delivery of this Agreement, nor the consummation of the transactions
contemplated hereby (including the assignments and assumptions referred to in
Section 2 above), will (i) 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
Seller is subject or any provision of the charter or bylaws of the Seller or
(ii) conflict with, result in a breach of, constitute a default under, result
in the acceleration of, create in any party the right to accelerate,
terminate, modify, or cancel, or require any notice under any agreement,
contract, lease, license, instrument, or other arrangement to which the
Seller 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 Seller 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 (including the assignments and assumptions
referred to in Section 2 above).
(d) BROKERS' FEES. The Seller 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 the
Buyer could become liable or obligated.
(e) TITLE TO ASSETS. The Seller has good and marketable
title to the Acquired Assets, free and clear of all Security Interests and
restriction on transfer; provided, however, that the Seller makes no
representation in this Section 3(e) with respect to the Acquired Assets that
constitute Intellectual Property.
(f) SUBSIDIARIES. There is no Subsidiary of the Seller that
(i) owns directly or indirectly any of the Acquired Assets or (ii) is subject
to any of the Assumed Liabilities.
(g) FINANCIAL STATEMENTS. The Seller has provided the Buyer
with the following financial statements (collectively the "FINANCIAL
STATEMENTS"): audited consolidated balance sheets and statements of income
of the Seller as of and for the fiscal year ended March 31, 1999. The
Financial Statements (including the notes thereto) have been prepared in
accordance with GAAP applied on a consistent basis throughout the period
covered thereby, present fairly the financial condition of the Seller as of
such date and the results of operations of the Seller for such period, are
correct and complete, and are consistent with the books and records of the
Seller (which books and records are correct and complete).
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(h) LEGAL COMPLIANCE. The Seller has complied in all
material respects with all applicable laws (including rules, regulations,
codes, plans, injunctions, judgments, orders, decrees, rulings, and charges
thereunder) of federal, state and local governments (and all agencies
thereof) in the conduct of business relating or pertaining to the Acquired
Assets, and no action, suit, proceeding, hearing, investigation, charge,
complaint, claim, demand, or notice has been filed or commenced against the
Seller alleging any failure so to comply; provided, however, that the Seller
makes no representation in this Section 3(h) as to infringement or violation
of the Intellectual Property rights of third parties.
(i) TAX MATTERS. The Seller has withheld and paid all Taxes
required to have been withheld and paid in connection with amounts paid or
owing to any of the Key Employees.
(j) COMPLETE CODEBASE. The Seller represents and warrants
that the source code and supporting documentation of the Acquired Assets and
the Active Voice Software (as listed in Exhibit 2 of the License Agreement)
is the complete codebase and documentation necessary to compile and operate
an executable object code program with the same features, functionality and
performance as exist in the MyAgent Product as of the date of this Agreement.
(k) INTELLECTUAL PROPERTY
(i) The Seller has granted no license, right or
permission to any third party in connection with the development, marketing,
distribution, use, making (including having made), sale, offer to sell, or
import of the Acquired Assets except for the beta end user licenses disclosed
in Section 3(k)(i) of the Disclosure Schedule and in the form attached to the
Disclosure Schedule as Exhibit 3(k)(i).
(ii) The Seller has only disclosed or made available
the Acquired Assets to third parties under appropriate non-disclosure
obligations.
(iii) The Seller has taken all necessary action to
maintain and protect each item of Intellectual Property that it owns or uses
with respect to the Acquired Assets.
(iv) Except as set forth in Section 3(k)(iv) of the
Disclosure Schedule, to the Knowledge of the Seller, in the conduct of the
business relating or pertaining to the Acquired Assets or the Intellectual
Property embodied therein, the Seller has not interfered with, infringed
upon, misappropriated, or otherwise come into conflict with any Intellectual
Property rights of third parties, and the Seller has never received any
charge, complaint, claim, demand, or notice alleging any such interference,
infringement, misappropriation, or violation (including any claim that the
Seller must license or refrain from using any Intellectual Property rights of
any third party). Except as set forth in Section 3(k)(iv) of the Disclosure
Schedule, to the Knowledge of the Seller, no third party has interfered with,
infringed upon, misappropriated, or otherwise come into conflict with any
Intellectual Property rights included in the Acquired Assets.
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(v) Section 3(k)(v) of the Disclosure Schedule
identifies each item of Intellectual Property included in the Acquired
Assets. The Seller has delivered to the Buyer correct and complete copies of
all patents, registrations, applications, licenses, agreements, and
permissions (as amended to date) for each item of Intellectual Property
required to be identified and has made available to the Buyer correct and
complete copies of all other written documentation evidencing ownership and
prosecution (if applicable) of each such item. With respect to each item of
Intellectual Property required to be identified in Section 3(k)(v) of the
Disclosure Schedule, except as specifically set forth therein:
(A) the Seller owns all right, title, and
interest in and to the item, free and clear of any Security Interest, or
other restriction, provided that this representation shall not be deemed to
create any warranty of noninfringement greater or lesser than that granted by
the Seller in Section 3(k)(iv) above;
(B) the item is not subject to any outstanding
injunction, judgment, order, decree, ruling, or charge;
(C) no action, suit, proceeding, hearing,
investigation, charge, complaint, claim, or demand is pending or to the
Seller's Knowledge is threatened which challenges the legality, validity,
enforceability, use, or ownership of the item; and
(D) the Seller has never agreed to indemnify
any Person for or against any interference, infringement, misappropriation,
or other conflict with respect to the item.
(vi) Section 3(k)(vi) of the Disclosure Schedule
identifies each item of Intellectual Property that any third party owns and
has made commercially available to the Seller and that the Seller uses as an
off-the-shelf developer tool or consumer application with respect to the
Acquired Assets pursuant to license, sublicense, agreement, or permission to
the extent that such third-party Intellectual Property is not included in the
Acquired Assets or disclosed in Section 3(k)(vii) below.
(vii) Section 3(k)(vii) of the Disclosure Schedule
identifies each item of Intellectual Property that any third party owns and
that the Seller uses as part of the Acquired Assets pursuant to license,
sublicense, agreement, or permission other than those items of Intellectual
Property identified in Section 3(k)(vii) of the Disclosure Schedule. The
Seller has delivered 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 3(k)(vii) of the Disclosure Schedule, except as otherwise set
forth therein:
(A) the license, sublicense, agreement, or
permission covering the item is legal, valid, binding, enforceable, and in
full force and effect;
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(B) the license, sublicense, agreement, or
permission is fully transferable and assignable by the Seller to the Buyer;
(C) 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;
(D) no party to the license, sublicense,
agreement, or permission has to the Seller's Knowledge repudiated any
provision thereof;
(E) with respect to each sublicense by the
Seller, to the Seller's Knowledge the representations and warranties set
forth in subsections (A) through (D) above are true and correct with respect
to the underlying license;
(F) to the Knowledge of the Seller, the
underlying item of Intellectual Property is not subject to any outstanding
injunction, judgment, order, decree, ruling, or charge;
(G) to the Knowledge of the Seller, no action,
suit, proceeding, hearing, investigation, charge, complaint, claim, or demand
is pending or threatened which challenges the legality, validity, or
enforceability of the underlying item of Intellectual Property; and
(H) the Seller has not granted any sublicense
or similar right with respect to the license, sublicense, agreement, or
permission, except for the beta end user licenses in the form attached hereto
as Exhibit 1.1.
(l) CONTRACTS. Section 3(l) of the Disclosure Schedule
lists the following contracts and other agreements that relate or pertain to
the Acquired Assets:
(i) any agreement concerning confidentiality or
noncompetition;
(ii) any agreement for the employment of any Key
Employee; or
(iii) any agreement under which the consequences of a
default or termination could have a material adverse effect on the Acquired
Assets.
Except as set forth in the Disclosure Schedule, the Seller has
delivered to the Buyer a correct and complete copy of each written agreement
listed in Section 3(l) of the Disclosure Schedule (as amended to date). With
respect to each such agreement: (A) the agreement is legal, valid, binding,
enforceable, and in full force and effect; (B) the agreement will continue to
be legal, valid, binding, enforceable, and in full force and effect on
identical terms following the consummation of the transactions contemplated
hereby (including the assignments and assumptions referred to in Section 2
above); (C) no party is in breach or default, and no event has occurred which
with notice or
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lapse of time would constitute a breach or default, or permit termination,
modification, or acceleration, under the agreement; and (D) no party has
repudiated any provision of the agreement.
(m) POWERS OF ATTORNEY. Except as set forth in Section 3(m)
of the Disclosure Schedule, there are no outstanding powers of attorney
executed relating or pertaining to the Acquired Assets.
(n) LITIGATION. The Seller (i) is not subject to any
outstanding injunction, judgment, order, decree, ruling, or charge and (ii)
is not a party and, to the Seller's Knowledge, is not threatened to be made a
party to any action, suit, proceeding, hearing, 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, in each case
relating or pertaining to the Acquired Assets.
(o) PRODUCT WARRANTY. The only products released by the
Seller that are included in or based upon the Acquired Assets have been in
the beta testing program and have been subject to the Seller's end user
agreements, which disclaim all express and implied warranties, and, to the
Seller's Knowledge, the Seller has no Liability (and there is no Basis for
any present or future action, suit, proceeding, hearing, investigation,
charge, complaint, claim, or demand against any of them giving rise to any
Liability) for replacement or repair thereof or other damages in connection
therewith. No product based on the Acquired Assets that has been
manufactured, sold, leased, licensed or delivered is subject to any guaranty,
warranty, or other indemnity beyond the applicable standard terms and
conditions of sale or lease. Section 3(o) of the Disclosure Schedule
includes copies of the standard terms and conditions of the beta testing
program.
(p) PRODUCT LIABILITY. To the Knowledge of the Seller, the
Seller has no Liability (and there is no Basis for any present or future
action, suit, proceeding, hearing, investigation, charge, complaint, claim,
or demand against any of them giving rise to any Liability) arising out of
any injury to individuals or property as a result of the ownership,
possession, or use of any product manufactured, sold, leased, licensed or
delivered with respect to the Acquired Assets.
(q) EMPLOYEES. To the Knowledge of the Seller, no employee
has any plans to terminate employment with the Seller other than to accept
Buyer's offer in connection with this Agreement.
(r) DISCLAIMER. Except as specifically set forth in this
Section 3, the Acquired Assets are and shall be provided strictly on an
"as-is" basis. Except as specifically set forth in this Section 3, to the
maximum extent allowable by law, the Seller hereby specifically disclaims all
warranties, whether express, implied or statutory, including, without
limitation any: (i) warranty of merchantability, (ii) warranty of fitness for
a particular purpose, (iii) warranty arising from course of performance,
course of dealing or usage of trade and/or (iv) warranty of title or
noninfringement, and the Buyer has relied on no other warranty of the Seller
in entering into this Agreement.
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4. REPRESENTATIONS AND WARRANTIES OF THE BUYER. The Buyer
represents and warrants to the Seller 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.
The Disclosure Schedule will be arranged in paragraphs corresponding to the
lettered and numbered paragraphs contained in this Section 4.
(a) ORGANIZATION OF THE BUYER. The Buyer is a corporation
duly organized, validly existing, and in good standing under the laws of the
jurisdiction of its incorporation.
(b) 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.
(c) NONCONTRAVENTION. Neither the execution and the
delivery of this Agreement, nor the consummation of the transactions
contemplated hereby (including the assignments and assumptions referred to in
Section 2 above), will 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. The Buyer 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 (including the
assignments and assumptions referred to in Section 2 above).
(d) BROKERS' FEES. 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 the Seller could
become liable or obligated.
(e) FINANCIAL STATEMENTS. The Buyer has provided the Seller
with the following Financial Statements (collectively, the "Buyer Financial
Statements"): unaudited consolidated balance sheets and statements of income
of the Buyer as of and for the quarter ended March 31, 1999. The Buyer
Financial Statements have been prepared in accordance with GAAP applied on a
consistent basis throughout the period covered thereby (provided that the
Buyer Financial Statements may not have complete footnotes and are subject to
year-end adjustments), present fairly the financial condition of the Buyer as
of such date and the results of operations of the Buyer for such period, are
correct and complete, and are consistent with the books and records of the
Buyer (which books and records are correct and complete).
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5. POST-CLOSING COVENANTS. The Parties agree as follows with
respect to the period following the Closing.
(a) GENERAL. In case at any time after the Closing any
further action is necessary or desirable 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 the
other Party reasonably may request, all the sole cost and expense of the
requesting Party (unless the requesting Party is entitled to indemnification
therefor under Section 7 below). The Seller acknowledges and agrees that
from and after the Closing the Buyer will be entitled to reasonable access to
all documents, books, records (including Tax records), agreements, and
financial data of any sort relating to the Acquired Assets.
(b) 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 on
or prior to the Closing Date involving the Acquired Assets, the other Party
will cooperate with the contesting or defending Party and its counsel in the
contest or defense, make available its personnel, and provide such testimony
and access to its 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 7 below).
(c) TRANSITION. The Seller will not 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 business relating to
the Acquired Assets from maintaining the same business relationships with the
Buyer after the Closing as it maintained prior to the Closing. The Seller
will refer all customer inquiries relating to the Acquired Assets to the
Buyer from and after the Closing. Each Party will implement the Active Voice
MyAgent Transition Plan substantially as outlined on EXHIBIT 5.1.
(d) CONFIDENTIALITY. Each Party will treat and hold as such
all of the Confidential Information of the other Party, refrain from using
any of the Confidential Information of the other Party except as permitted by
this Agreement and the License Agreement, and deliver promptly to the other
Party or destroy, at the request and option of the disclosing Party, all
tangible embodiments (and all copies) of the Confidential Information which
are in its possession. In the event that either Party 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 of the other Party,
such Party will notify the other Party promptly of the request or requirement
so that the other Party may seek an appropriate protective order or waive
compliance with the provisions of this Section 5(d). If, in the absence of a
protective order or the receipt of a waiver hereunder, a Party is, on the
advice of counsel, compelled to disclose any Confidential Information of the
other Party to any tribunal or else stand liable for contempt, such Party may
disclose the Confidential Information to the tribunal; PROVIDED, HOWEVER,
that such Party
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shall use its reasonable best efforts to obtain, at the reasonable request of
the other Party, an order or other assurance that confidential treatment will
be accorded to such portion of the Confidential Information required to be
disclosed as the other Party shall designate.
(e) COVENANT NOT TO SOLICIT EMPLOYEES. Except for the
Buyer's negotiations with or hiring of the Key Employees in connection with
this Agreement, the Parties agree that for twelve (12) months from the date
of this Agreement, neither Party shall hire any individuals who are employees
of the other during such 12-month period, nor directly or indirectly solicit
or entice any of the other Party's employees to cease, terminate or reduce
any relationship with the other Party during such period.
6. CONDITIONS TO OBLIGATION TO CLOSE.
(a) CONDITIONS TO OBLIGATION OF THE BUYER. 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:
(i) the representations and warranties set forth in
Section 3 above shall be true and correct in all material respects at and as
of the Closing Date;
(ii) the Seller shall have performed and complied with
all of its covenants hereunder in all material respects through the Closing;
(iii) the Seller shall have procured all of the third
party consents identified in the Disclosure Schedule;
(iv) no action, suit, or proceeding shall be pending
or threatened 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, or (C) affect adversely the
right of the Buyer to own the Acquired Assets (and no such injunction,
judgment, order, decree, ruling or charge shall be in effect);
(v) the Seller shall have delivered to the Buyer a
certificate to the effect that each of the conditions specified above in
Section 6(a)(i)-(iv) is satisfied in all respects;
(vi) the Seller and the Buyer shall have received all
authorizations, consents, and approvals of governments and governmental
agencies referred to in Section 3(c) and Section 4(c) above;
(vii) each Key Employee shall have executed and
delivered an Employment Agreement in substantially the form attached hereto
as Exhibit 6.1 and the Seller shall have executed a Release in the form
attached hereto as Exhibit 6.2 with respect to such Key Employee;
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(viii) the Seller shall have executed and delivered the
License Agreement; and
(ix) the Buyer shall have received from (A) Xxxxxx
Godward LLP, counsel to the Seller, an opinion in form and substance as set
forth in Exhibit 6.3 and (B) Xxxxxxxx Xxxxxxx Xxxxx LLP, intellectual
property counsel to the Seller, an opinion in form and substance as set forth
in Exhibit 6.4 attached hereto, in each case addressed to the Buyer and dated
as of the Closing Date.
The Buyer may waive any condition specified in this Section 6(a) if it
executes a writing so stating at or prior to the Closing.
(b) CONDITIONS TO OBLIGATION OF THE SELLER. The obligation
of the Seller to consummate the transactions to be performed by it in
connection with the Closing is subject to satisfaction of the following
conditions:
(i) the representations and warranties set forth in
Section 4 above shall be true and correct in all material respects at and as
of the Closing Date;
(ii) the Buyer shall have performed and complied with
all of its covenants hereunder in all material respects through the Closing;
(iii) no action, suit, or proceeding shall be pending
or threatened 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);
(iv) the Buyer shall have delivered to the Seller a
certificate to the effect that each of the conditions specified above in
Section 6(b)(i)-(iii) is satisfied in all respects;
(v) the Buyer shall have executed and delivered the
License Agreement; and
(vi) the Seller shall have received from Xxxxxx
Xxxxxxx Xxxxxxxx & Xxxxxx, P.C., counsel to the Buyer, an opinion in form and
substance as set forth in Exhibit 6.5 attached hereto, addressed to the
Seller, and dated as of the Closing Date.
The Seller may waive any condition specified in this Section 6(b) if
it executes a writing so stating at or prior to the Closing.
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7. REMEDIES FOR BREACHES OF THIS AGREEMENT.
(a) SURVIVAL OF REPRESENTATIONS AND WARRANTIES. All of the
representations and warranties of the Seller contained in Section 3(f)-(h)
and Section 3(j)-(q) of this Agreement shall survive the Closing (even if the
Buyer 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 until
December 31, 2000. All of the other representations and warranties of the
Buyer and the Seller contained in this Agreement (including the
representations and warranties of the Seller contained in Section 3(a)-(e)
and Section 3(i) hereof) 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 forever thereafter
(subject to any applicable statutes of limitations).
(b) INDEMNIFICATION PROVISIONS FOR BENEFIT OF THE BUYER.
The Seller agrees to indemnify the Buyer from and against the entirety of any
Adverse Consequences the Buyer may suffer resulting from, arising out of,
relating to, in the nature of, or caused by any Liability of the Seller
relating or pertaining to the Acquired Assets and arising from actions or
facts occurring prior to and including the time of Closing which is not an
Assumed Liability (including any Liability of the Seller that becomes a
Liability of the Buyer under any bulk transfer law of any jurisdiction, under
any common law doctrine of de facto merger or successor liability or
otherwise by operation of law). Notwithstanding the foregoing and anything to
the contrary herein, unless the Seller has breached its representation and
warranty in the first sentence of Section 3(k)(iv) above, the Seller shall
not have any obligation to indemnify the Buyer for any Adverse Consequences
suffered by the Buyer or its licensees, successors and/or assigns, resulting
from, arising out of, relating to, in the nature of, or caused by any patent
infringement claims relating or pertaining to the Acquired Assets.
(c) INDEMNIFICATION PROVISIONS FOR BENEFIT OF THE SELLER.
The Buyer agrees to indemnify the Seller from and against the entirety of any
Adverse Consequences the Seller may suffer resulting from, arising out of,
relating to, in the nature of, or caused by any Liability of the Buyer
relating or pertaining to the Acquired Assets and arising from actions or
facts occurring after the time of Closing; provided, however, that the Buyer
shall have no obligation to indemnify the Seller pursuant to this Section
7(c) to the extent that the Adverse Consequences of the Seller arise,
directly or indirectly, from a breach of a representation, warranty or
convenant of the Seller made pursuant to this Agreement.
(d) LIMITATIONS ON CLAIMS.
(i) The Seller will have no liability for
indemnification pursuant to Section 7(b) unless on or before December 31,
2000 the Buyer notifies the Seller of a claim specifying the factual basis of
that claim in reasonable detail to the extent then known by the Buyer. The
Buyer will have no liability for indemnification pursuant to Section 7(c)
unless on or before December 31, 2000 the Seller notifies the Buyer of a
claim specifying the factual basis of that claim in reasonable detail to the
extent then known by the Seller.
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(ii) The aggregate liability of the Seller to the
Buyer for claims made by the Buyer pursuant to this Agreement or the License
Agreement, whether in contract, tort or otherwise, shall not exceed the
Purchase Price. The aggregate liability of the Buyer to the Seller for
claims made by the Seller pursuant to this Agreement or the License
Agreement, whether in contract, tort or otherwise, shall not exceed the
Purchase Price.
(e) MATTERS INVOLVING THIRD PARTIES.
(i) If any third party shall notify any Party (the
"INDEMNIFIED PARTY") with respect to any matter (a "THIRD PARTY CLAIM") which
may give rise to a claim for indemnification against the other Party (the
"INDEMNIFYING PARTY") under this Section 7, then the Indemnified Party shall
promptly notify the Indemnifying Party thereof in writing; PROVIDED, HOWEVER,
that no delay on the part of the Indemnified Party in notifying the
Indemnifying Party shall relieve the Indemnifying Party from any obligation
hereunder unless (and then solely to the extent) the Indemnifying Party
thereby is prejudiced.
(ii) The Indemnifying Party will have the right to
defend the Indemnified Party against the Third Party Claim with counsel of
its choice reasonably satisfactory to the Indemnified Party so long as (A)
the Indemnifying Party notifies the Indemnified Party in writing within 20
days after the Indemnified Party has given notice of the Third Party Claim
that the Indemnifying Party will indemnify the Indemnified Party from and
against the entirety of 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, (B) the Indemnifying Party provides the
Indemnified Party with evidence reasonably acceptable to the Indemnified
Party that the Indemnifying Party will have the financial resources to defend
against the Third Party Claim and fulfill its indemnification obligations
hereunder, (C) the Third Party Claim involves only money damages and does not
seek an injunction or other equitable relief, (D) settlement of, or an
adverse judgment with respect to, the Third Party Claim is not, in the good
faith judgment of the Indemnified Party, likely to establish a precedential
custom or practice adverse to the continuing business interests of the
Indemnified Party, and (E) the Indemnifying Party conducts the defense of the
Third Party Claim actively and diligently.
(iii) So long as the Indemnifying Party is conducting
the defense of the Third Party Claim in accordance with Section 7(e)(ii)
above, (A) the Indemnified Party may retain separate co-counsel at its sole
cost and expense and participate in the defense of the Third Party Claim, (B)
the Indemnified Party will not consent to the entry of any judgment or enter
into any settlement with respect to the Third Party Claim without the prior
written consent of the Indemnifying Party (not to be withheld unreasonably),
and (C) the Indemnifying Party will not consent to the entry of any judgment
or enter into any settlement with respect to the Third Party Claim without
the prior written consent of the Indemnified Party (not to be withheld
unreasonably).
(iv) In the event that any of the conditions in
Section 7(e)(ii) above is or becomes unsatisfied, however, (A) the
Indemnified Party may defend against, and consent to the
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entry of any judgment or enter into any settlement with respect to, the Third
Party Claim in any manner with respect to any claim for injunctive relief or
a substantially similar remedy (and the Indemnified Party need not consult
with, or obtain any consent from, the Indemnifying Party in connection
therewith, but must consult with and obtain consent from the Indemnifying
Party with respect to any monetary damages, which consent shall not be
unreasonably withheld or delayed), (B) the Indemnifying Party will reimburse
the Indemnified Party promptly and periodically for the costs of defending
against the Third Party Claim (including reasonable attorneys' fees and
expenses), and (C) the Indemnifying Party 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 7.
(f) DETERMINATION OF ADVERSE CONSEQUENCES. The Parties
shall take into account the time cost of money (using the Applicable Rate as
the discount rate) in determining Adverse Consequences for purposes of this
Section 7. All indemnification payments under this Section 7 shall be deemed
adjustments to the Purchase Price.
(g) OTHER INDEMNIFICATION PROVISIONS. The foregoing
indemnification provisions are in addition to, and not in derogation of, any
statutory, equitable, or common law remedy any Party may have for breach of
representation, warranty, or covenant any Party may have with respect to the
Acquired Assets, or the transactions contemplated by this Agreement.
8. MISCELLANEOUS.
(a) 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 without the prior written approval of the
other Party; 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 advise the other Party prior to making the
disclosure and give the other party a reasonable opportunity to comment upon
and edit such disclosure).
(b) 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.
(c) ENTIRE AGREEMENT. This Agreement (including the License
Agreement and the other documents referred to herein) constitutes the entire
agreement between the Parties and supersedes any prior or contemporaneous
understandings, agreements, or representations by or between the Parties,
written or oral, to the extent they have related in any way to the subject
matter hereof. This Agreement shall not be deemed valid without the
concurrent mutual execution and delivery of the License Agreement.
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(d) 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 its rights, interests, or obligations hereunder without
the prior written approval of the other Party; PROVIDED, HOWEVER, that either
Party may assign any or all of its rights and interests hereunder to an
acquiror in the event of (i) a merger of the assigning Party, (ii) an
acquisition of more than fifty percent (50%) of the outstanding voting stock
of the assigning Party or (iii) a sale of all or substantially all of the
assets of the assigning Party, provided that in each such case (x) the
assignee shall agree to be bound by the terms of this Agreement and (y) the
assigning Party nonetheless shall remain responsible for the performance of
all of its obligations hereunder.
(e) 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.
(f) 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.
(g) 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 SELLER:
Active Voice Corporation
0000 Xxxxx Xxxxxx
Xxxxx 000
Xxxxxxx, Xxxxxxxxxx 00000
Telecopy: (000) 000-0000
Attention: Chief Executive Officer
Attention: General Counsel
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IF TO THE BUYER: COPY TO:
XxxxXxxxx.xxx, Inc. Xxxxxx Xxxxxxx Xxxxxxxx & Xxxxxx
00000 XX 00xx Xxxxxx Professional Corporation
Xxxxxxx, Xxxxxxxxxx 00000 5300 Carillon Point
Telecopy: (000) 000-0000 Xxxxxxxx, Xxxxxxxxxx 00000
Attention: Xxxxx X. Xxxxx, Esq. Telecopy: (000) 000-0000
Vice President of Legal Attention: Xxxxxxx X. Xxxxxxxxxx, Esq.
and Business Affairs
AND A COPY TO:
Xxxxxxxxxxx O'Xxxxxx Xxxxxxx &
Kindness
0000 Xxxxx Xxxxxx
Xxxxx 0000
Xxxxxxx, Xxxxxxxxxx 00000
Telecopy: (000) 000-0000
Attention: Xxxxx X. X'Xxxxxx, 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 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 Party notice in the manner herein set forth.
(h) GOVERNING LAW. This Agreement shall be governed by and
construed in accordance with the domestic laws of the State of Washington
without giving effect to any choice or conflict of law provision or rule
(whether of the State of Washington or any other jurisdiction) that would
cause the application of the laws of any jurisdiction other than the State of
Washington.
(i) 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 Seller. 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 or 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
such occurrence.
(j) 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.
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(k) EXPENSES. Each of the Buyer and the Seller will bear
its own costs and expenses (including legal fees and expenses) incurred in
connection with this Agreement and the transactions contemplated hereby.
(l) CONSTRUCTION. The Parties have participated jointly in
the negotiation and drafting of this Agreement. In the event that an
ambiguity or question of intent or interpretation arises, 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. Nothing in the Disclosure Schedule shall be deemed adequate to
disclose an exception to a representation or warranty made herein unless the
Disclosure Schedule identifies the exception with reasonable particularity
and describes the relevant facts in reasonable detail. The Parties intend
that each representation, warranty, and covenant contained herein shall have
independent significance.
(m) INCORPORATION OF EXHIBITS AND SCHEDULES. The Exhibits
and Schedules identified in this Agreement are incorporated herein by
reference and made a part hereof.
(n) SPECIFIC PERFORMANCE. Each of the Parties acknowledges
and agrees that the other Party would be damaged irreparably in the event any
of the provisions of this Agreement are not performed in accordance with
their specific terms or otherwise are breached. Accordingly, each of the
Parties agrees that the other Party shall be entitled to an injunction or
injunctions to prevent breaches of the provisions of this Agreement and to
enforce specifically this Agreement and the terms and provisions hereof in
any action instituted in any court of the United States or any state thereof
having jurisdiction over the Parties and the matter (subject to the
provisions set forth in Section 8(o) below), in addition to any other remedy
to which it may be entitled, at law or in equity.
(o) SUBMISSION TO JURISDICTION.
(i) POLICY: Any claim or dispute between the Parties
arising out of or relating to this Agreement, whether or not a contract
claim, shall be exclusively determined by binding arbitration under the
International Commercial Arbitration Rules of the American Arbitration
Association ("AAA RULES"), as modified by the provisions of this Agreement;
provided that the total award by a single arbitrator (as opposed to a
majority of the arbitrator(s)) shall not exceed two hundred fifty thousand
dollars (US$250,000) including interest, attorneys' fees and costs. If
either Party demands a total award greater than two hundred fifty thousand
dollars (US$250,000) there shall be three (3) neutral arbitrators. If the
Parties cannot agree on the identity of the arbitrator(s) within fifteen (15)
days of the arbitration demand, the arbitrator(s) shall be selected in
accordance with AAA Rules. At least one arbitrator shall be an attorney with
more than ten (10) years of experience. Whether a claim is covered by this
Agreement shall be determined by the arbitrator(s). All statutes of
limitations which would otherwise be applicable shall apply to any
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arbitration proceedings hereunder. The arbitration shall be conducted in the
English language in Seattle, Washington.
(ii) NONBINDING MEDIATION: At the request of either
Party, made not later than forty-five (45) days after the initial arbitration
demand, the Parties agree to submit the dispute to nonbinding mediation which
shall not delay the arbitration hearing date.
(iii) HEARING: The arbitrator(s) shall take such steps
as may be necessary to hold a private hearing within one hundred eighty (180)
days of the arbitration demand; to conclude the hearing within three (3)
days; and to render a written decision not later than twenty (20) days after
the hearing. The Parties have included these time limits in order to expedite
the proceeding, but they are not jurisdictional, and the arbitrator(s) may
for good cause afford or permit reasonable extensions or delays, which shall
not affect the validity of the award. The written decision shall contain a
brief statement of the claim(s) determined and the award made on each claim.
In making the decision and award, the arbitrator(s) shall apply applicable
law. The arbitrator(s) may award injunctive relief or any other remedy
available from a judge, and may award attorneys' fees and costs to the
prevailing Party but shall not have the power to award punitive damages.
(iv) PROCEDURES: There shall be no discovery or
substantive motions, except the arbitrator(s) shall authorize such discovery
as may be shown to be necessary to ensure a fair hearing. The arbitrator(s)
shall not be bound by the rules of evidence or of civil procedure, but rather
may consider such writings and oral presentations as reasonable business
people would use in the conduct of their day-to-day affairs, and may require
the Parties to submit some or all of their case by written declaration or
such other manner of presentation as the arbitrator(s) may determine to be
appropriate. The Parties intend to limit live testimony and cross-examination
to the extent necessary to ensure a fair hearing on material issues.
(v) ARBITRATION DECISION, JURISDICTION AND VENUE:
The award of the arbitrator(s) shall be final and nonappealable, absent
fraud, collusion or willful misconduct by the arbitrator(s). The award may
be confirmed and enforced in any court having jurisdiction and the Parties
hereby consent to the jurisdiction and venue of the courts of the State of
Washington or of any federal court located in such state for such purposes.
The Parties hereby waive all defenses as to personal jurisdiction, venue and
sovereign immunity from jurisdiction, attachment and execution in any
proceeding to confirm or enforce the award. The Party who brings any
proceeding to enforce the award and prevails shall be paid its full costs and
attorneys' fees by the other Party.
(vi) INJUNCTIVE RELIEF: Either Party may seek
temporary or preliminary injunctive relief from a court in any jurisdiction.
By obtaining any such remedy, neither Party shall waive the provisions of
subparagraphs (i) through (v) above.
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IN WITNESS WHEREOF, the Parties hereto have executed this Agreement as
of the date first above written.
XXXXXXXXX.XXX, INC.
By: /s/ Bernee X. X. Xxxxx
------------------------
Title: President and COO
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ACTIVE VOICE CORPORATION
By: /s/ Xxxxx X. Xxxxx
------------------------
Title: President and CEO
------------------------
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