ASSET PURCHASE AGREEMENT
This Asset Purchase Agreement (this "Agreement") is made and entered
into as of the 4th day of October, 2000 by and between ABB Automation Inc., a
corporation incorporated and in good standing under the laws of the State of
Ohio, having its principal place of business located at 501 Merritt 7, Norwalk,
Connecticut ("Purchaser") and Base Ten Systems, Inc., a corporation incorporated
and in good standing under the laws of the State of New Jersey, having its
principal office at One Electronics Drive, Trenton, New Jersey ("Seller").
W I T N E S S E T H:
WHEREAS, Seller is in the business, among other businesses, of
providing Manufacturing Execution Systems (MES) software (the "Products"); which
can be used to manage the manufacture and assembly of FDA and/or
comparably-regulated products generally categorized by Seller as "ME", "CS" and
"FS"; and
WHEREAS, Purchaser wishes to acquire, and Seller wishes to sell,
transfer, assign and convey to Purchaser certain of the assets owned by Seller
relating to the Products, solely upon the terms and conditions set forth in this
Agreement;
NOW, THEREFORE, and in consideration of the mutual promises and
covenants hereinafter contained, and other good and valuable consideration, the
receipt and sufficiency of which are hereby acknowledged, Seller and Purchaser
hereby agree as follows:
1. Purchase and Sale.
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1.1 Transfer of Assets: On the terms and subject to the conditions of this
Agreement, at the Closing referred to in Article 8 hereof (hereinafter
termed the "Closing"), Seller shall transfer, convey and assign to
Purchaser and Purchaser shall accept, acquire and purchase all the
right, title and interest of Seller in assets as of the Closing, of
every kind, character and description, whether tangible or intangible,
personal and wherever located, of Seller's MES Business (defined, for
purposes of this Agreement, to mean an unincorporated business segment
of Seller which designs, develops (including, but not limited to,
patents, copyrights, trademarks and trade names, data, ideas, modules,
components, hardware and software designs, utilities, interfaces,
templates, subroutines, concepts, analyses, methods, techniques,
algorithms, formulas, technical information, software, the Products,
hardware including computers and equipment used in connection with R&D
related thereto, know-how, documentation and specifications used or
developed by Seller in the course of its MES Business), manufactures or
has manufactured for it, configures, tests, sells and services
manufacturing execution systems and as may be generally categorized by
Seller as ME , CS and FS (hereinafter termed the "Business")) as
reflected as of close of business on August 31, 2000 on Seller's
financial books and other pertinent records, including without
limitation the following assets (except as provided to the contrary in
Articles 1.3 and 2 hereof, and except to the extent such assets and
properties shall have been disposed of in the ordinary course of
business of Seller or if such disposition is not in the ordinary course
of business then with the express written consent of Purchaser during
the period from the date hereinabove first written to the Closing Date)
(collectively, the "Purchased Assets"):
(a) Capital Assets. All capital assets used by the Business listed on
Schedule 1.1(a) and additions thereto and deletions therefrom in
the ordinary course of Seller's business (the "Capital Assets").
(b) Equipment/Units. All units of equipment including computers,
office and laboratory equipment and related software owned by
Seller (the "Owned Equipment"), specifically listed in Schedule
1.1(b) (the "Equipment and Personal Property List").
(c) Personal Property. All tools, supplies, and all other items of
personal property owned by Seller, used by the Business as
specifically listed in Schedule 1.1(c).
(d) Leased Equipment. All equipment leased to Seller (the "Leased
Equipment") used in the Business as specifically listed on
Schedule 1.1(d).
(e) Inventory. All inventory of Products, including work in progress,
supplies, spare parts, packing containers and materials, and the
like, and advanced payments on hand at Seller's offices (the
"Inventory"), used in the Business as specifically listed on
Schedule 1.1(e).
(f) Contracts and Account Receivables. All rights, privileges, claims
and obligations of Seller (including rights and claims to refunds
and adjustments) in, to and under specified customer contracts
(the "Contracts") and accounts set forth on Schedule 1.1(f).
Seller shall make its reasonable best efforts to obtain from
customers consents that may be required to assign the Contracts
to Purchaser, and to the extent that Seller is unable to obtain
any such consent, Seller shall cooperate with Purchaser, and make
any reasonable accommodation for Purchaser, to ensure that
Purchaser receives the full benefits of the Contracts on or
before October 16, 2000. If Seller does not provide Purchaser
with consent for the assignment of any Contract for which consent
is required on or before October 16, 2000, such Contract shall be
considered a Subcontracted Contract, pursuant to Section 11.1
hereof, until such time as Purchaser receives such consent, at
which time such Contract shall be assigned to Purchaser.
(g) Orders. All purchase and sales orders made or entered in the
ordinary course of Seller's Business from September 1, 2000 to
the Closing Date, to the extent that such orders shall be
outstanding and/or unfilled in whole or in part at the time of
Closing, and set forth in Schedule 1.1(g) (the "Orders").
(h) Intellectual Property. All letters patents, patent applications,
technology, inventions, trade secrets, processes, know-how,
designs, drawings, manufacturing files, including but not limited
to bills of materials, suppliers data, ideas, modules, utilities,
interfaces, templates, subroutines, concepts, analyses,
specifications, methods, techniques, algorithms, software source
programs, documentation, test procedures, test tool designs,
copyrights, software, software licenses, formulae and all other
industrial and intellectual property used by the Business as
listed on Schedule 1.1(h) (the "Intellectual Property").
(i) Trademarks and Trade Names. All trade designations such as
trademarks, trade names (including the "Base Ten Systems" name
itself and all variations thereof), service marks, and related
registrations, licenses and applications used by the Business as
listed on Schedule 1.1(i) (the "Trademarks and Trade Names"). The
"Base Ten Systems, Inc." name shall be licensed on an
nonexclusive, non-assignable, non-transferable worldwide,
royalty-free basis to Seller until the change of Seller's
corporate name is approved by the Seller's shareholders which
action shall be proposed to and endorsed by Seller at the first
Seller's Annual Shareholders Meeting following the Closing and,
if not so changed, annually thereafter, during which license
period the Seller shall use the name only with respect to its
corporate filings with Federal, State and local regulatory
authorities, securities exchanges and markets, and if Seller
wishes to use it for any other identification purposes not having
any market impact, Seller may seek Purchaser's prior written
consent in each such case which shall not be unreasonably
refused; Seller is so hereby licensed by Purchaser.
(j) Records. All business and operating records of the Business in
the possession of Seller and relating to the Purchased Assets:
customer lists, MES software development and / or manufacturing
records, data, analyses and drawings used by the Business, sales,
purchasing, technical, Key Employee personnel files, and labor
relations records, but excluding all accounting, financial, and
tax records of Seller, other than those records or portions
thereof which Seller, after consultation with Purchaser,
determines as being necessary to the ongoing management of the
Business.
(k) Personnel. Schedule 1.1(k) sets forth a complete list of those
employees and consultants of Seller who are allocated to the
Business as of the Closing who are a necessary and conditional
part of this transaction ("Key Employees"), such that prior to
Closing all Key Employees shall have executed employment
contracts or other retention and non-competition agreements with
Purchaser, in form and substance satisfactory to and in the sole
discretion of Purchaser, and whose employment by Seller shall
terminate as of the Closing; provided, that, (i) it shall not be
a condition of Closing that the Belgian Key Employees (as
hereinafter defined) shall have executed employment contracts or
other retention and non-competition agreements with Purchaser
prior to Closing, and (ii) Seller shall not be responsible for
securing Purchaser's employment of any of the Belgian Key
Employees, and in the event that any of the Belgian Key Employees
do not enter into employment contracts or other retention and
non-competition contracts with Purchaser, Purchaser shall have no
recourse or claim against Seller with respect to same.
1.2 It is the intent of Purchaser and Seller that all assets of Seller
which are used by the Business are included in this transaction and
will be sold to Purchaser.
1.3 Assets and Obligations Not Being Transferred: There are expressly
excluded from the Purchased Assets to be transferred, conveyed and
assigned to Purchaser the following (the "Excluded Assets"):
(a) The corporate minute books and stock record books of Seller.
(b) Cash and cash equivalents and cash items of any kind whatsoever
of Seller, all certificates of deposit, money market instruments,
bank balances and rights in and to bank accounts, commercial
paper and marketable securities owned by Seller.
(c) The premises occupied by the Business as of the Closing and all
other real property legally or beneficially owned or leased by
Seller and any records with respect thereto, if any.
(d) Seller's technology, including but not limited to patents,
know-how, technical information and other data, and other
licenses, permits and authorizations, which has not been used by
the Business, as set forth in Section 1.1.
(e) All of Seller's right, title and interest in or arising under or
in connection with any policy of insurance and certificate issued
with respect thereto.
(f) Those certain other assets, properties, prepaid expenses and
accrued income of Seller, if any, and Seller's equipment
inventory, described and identified in Schedule 1.3(f) which are
identified or otherwise attributable to each of the contracts of
the Business, the performance of which is not being assumed by
Purchaser under this Agreement or which are not otherwise
assigned by Seller to Purchaser hereunder.
(g) All pension, profit-sharing, retirement, deferred compensation,
stock purchase, stock option, incentive, bonus, accrued
commissions, savings, 401(k), severance, disability,
hospitalization, health insurance, medical insurance, life
insurance, fringe benefit, welfare and other employee benefit
plans, programs or arrangements and the assets thereof of Seller
or to which any employees of Seller (including, without
limitation, personnel of the Business) may be entitled.
(h) All other assets of Seller which are not expressly transferred
pursuant to Article 1.1, Transfer of Assets, hereof.
2. Liabilities and Obligations
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2.1 Liabilities Assumed: Simultaneously with the transfer, conveyance and
assignment to Purchaser of the Purchased Assets, Purchaser shall assume
only the following liabilities and obligations of Seller (the "Assumed
Liabilities"):
(a) All contractual performance liabilities and obligations of Seller
arising under Contracts and Orders after the Closing; provided,
however, that (i) Purchaser shall not assume financial
responsibility for the costs to correct defects and/or
functionality deficiencies in (x) products of the Business
manufactured or supplied, (y) products sold or (z) services
performed by Seller under the Contracts and Orders ("Warranty
Work"), and (ii) Purchaser shall assume all contractual
performance liabilities and obligations of Seller that arose, or
may arise, out of any of the customer contracts specified on
Schedule 2.1(a) hereof at any time prior to the Closing,
including financial responsibility for the costs to correct any
of the defects and/or functionality deficiencies referred to in
Sections 2.1(a)(i)(x), (y) and (z) hereof.
(b) Except for liabilities arising out of or related to events
occurring and/or Products manufactured and/or delivered prior to
Closing, all liabilities, if any, to persons for bodily injury or
property damage occurring in connection with any of the Purchased
Assets at any time after the Closing, and upon valid tender by
Seller to Purchaser of any such claim, demand, suit, process or
action alleging liability herein assumed by Purchaser, Purchaser
shall at its own cost and expense defend, indemnify and hold
harmless Seller with respect to such claim, demand, suit or
action.
(c) All liabilities and obligations of Seller with respect to the
Purchased Assets, including litigation, suits, claims, demands or
governmental proceedings, based on facts arising after the
Closing.
(d) Purchaser shall be responsible for all obligations under the
equipment leases set forth on Schedule 1.1(d) hereof that are
marked for employees or agents of Seller hired or retained by
Purchaser from and after the Closing or, if later, from and after
the date of such hiring or retention by Purchaser, pro rated to
the actual date, and, except for liabilities and / or obligations
related to events occurring prior to such date, Purchaser shall
hold Seller harmless from obligations of every kind related
thereto.
2.2 Obligations Not Being Assumed:
(a) Except as specified in Article 2.1 and Article 9 hereof, assumes
no other liabilities or obligations.
(b) All obligations and liabilities for taxes measured by Seller's
gross receipts or income or payroll taxes or any deficiencies,
interest and/or penalties in connection therewith, or taxes
arising in connection with Seller's possession, use, ownership or
operation of the Purchased Assets prior to the Closing and/or the
business and operations of Seller prior to the Closing, shall
remain the sole responsibility of Seller.
(c) All obligations and liabilities of Seller relating to the
Excluded Assets referred to in Article 1.3 herein shall remain
the sole responsibility of Seller.
(d) All liabilities, if any, to persons for bodily injury or property
damage occurring in connection with any of the Purchased Assets
at any time prior to the Closing shall remain the sole
responsibility of Seller, and upon any tender by Purchaser to
Seller of any such claim, demand, suit, process or action
alleging any liability herein retained by Seller, Seller shall at
its own cost and expense defend, indemnify and hold harmless
Purchaser in respect to such claim, demand, suit or action as
described in Article 9 hereof.
(e) Obligations of Seller to personnel of the Business arising and/or
accrued to, but not after, the Closing under all applicable
employee compensation, insurance and benefit plans including, but
not limited to, incentive compensation, deferred compensation,
severance, hospitalization or other medical (including retiree
medical), pension, savings and retirement plans, unpaid vacation
or un-used sick leave remain the sole responsibility of Seller
unless such obligation is specifically identified by name and
amount as part of the Purchased Assets or Assumed Liabilities.
(f) All liabilities and obligations of Seller with respect to the
Purchased Assets, including accounts payable, litigation, suits,
claims, demands, or governmental proceedings, based on facts
arising prior to the Closing or resulting from Products
manufactured, supplied or sold, or services rendered by, Seller
prior to the Closing, (except as otherwise provided herein with
respect to the Contracts set forth on Schedule 2.1(a)) shall
remain the sole responsibility of Seller (these obligations and
liabilities, together with all the other obligations and
liabilities which are not Assumed Liabilities are hereinafter
referred to as the "Excluded Liabilities").
3. Purchase Price, Method of Payment
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Purchaser, as full payment for the Purchased Assets, shall pay to
Seller the sum of Two Million Dollars ($2,000,000) (the "Purchase
Price"), to be paid as follows: The sum of Two Million dollars
($2,000,000) at the Closing Date in cash by bank-confirmed wire
transfer to the account of Seller as follows:
Fleet Bank, N.A.
NA CHIP 032
ABA#: 021200339 FLEET BANK USA
ACCT#: 31620-11455
BASE TEN SYSTEMS, INC.
4. Seller's Representations and Warranties.
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Seller hereby represents and warrants to Purchaser as follows:
4.1 Existence and Good Standing. Seller is a corporation duly organized,
validly existing and in good standing under the laws of the State of
New Jersey and is qualified to do business and is in good standing in
every jurisdiction where the failure to be so qualified would have a
material adverse effect upon the Seller .
4.2 Authority of Seller; Consents. The execution, delivery and consummation
of this Agreement and the transactions contemplated hereby by Seller
has been duly authorized by its Board of Directors in accordance with
all applicable laws and the Certificate of Incorporation and Bylaws of
Seller, and no further corporate action will be necessary on the part
of Seller to make this Agreement valid and binding upon Seller and
enforceable against Seller in accordance with its terms. No approval or
consent of any person, shareholder(s), firm or governmental agency,
division or office is required to be obtained by Seller for the
authorization of this Agreement or the consummation of the transactions
contemplated by this Agreement (except with respect to the assignment
of Contracts to Purchaser by Seller set forth in Section 1.1(f)).
4.3 No Conflicts. The execution and delivery of this Agreement, the
consummation of this transaction and/or the fulfillment of the terms
and provisions of this Agreement will not constitute a default under or
conflict with any judgment, decree or order or award of any court or
other governmental body, or any agreement or understanding to which
Seller is a party or to which any of the Assets are subject.
4.4 Title to Assets; Condition of Assets. Seller has good and marketable
title to all of the Purchased Assets being transferred to Purchaser
hereunder. Title to the Purchased Assets will be transferred to
Purchaser free and clear of all liens, claims, security interests, and
encumbrances excluding contractually-required source code escrows with
all customers identified in Schedule 4.4, and with respect to which
escrows are not covered by Contracts identified in Schedule 1.1(f),
copies of such source code escrow agreements shall be attached hereto.
4.5 Intellectual Property. Seller is the sole and exclusive owner of all of
the Intellectual Property, free and clear of all Liens except to the
extent reflected in Section 4.4 hereinabove. Set forth on Schedule
1.1(h) is a listing by filing office, registration number and filing
date of all Intellectual Property that is registered or filed in, or
issued by, the United States Patent and Trademark Office, the United
States Register of Copyrights or the corresponding offices of any other
countries or any state, which offices are identified on said Schedule,
and those so registered or filed in, or issued by, have been properly
maintained and renewed in accordance with all applicable provisions of
law and administrative regulations of the pertinent countries and
states. Seller is not obligated to pay any amount, whether as a
royalty, license fee or other payment, to any person to use any of the
Intellectual Property used with the Products and transferred hereunder.
Seller's use to the Closing Date and Purchaser's use for purposes of
the Business thereafter of the Intellectual Property does not and shall
not infringe upon the patent, registered copyright, trademark, service
mark, or trade name of any third party, and Seller has received no
notice of any such infringement. None of the Intellectual Property has
been assigned or transferred, in whole or in part, to any third party.
To the best of Seller's knowledge (i) no other person, firm or entity
has infringed or is infringing upon Seller's rights to any of the
Intellectual Property, and (ii) no action is presently planned or
pending against any person, firm or entity to protect or enforce any
right of Seller in and to the Intellectual Property, except in either
case as listed in Schedule 4.5.
4.6 Litigation. There is no litigation, arbitration, proceeding or
controversy known to Seller which is pending before any court or
governmental authority, or arbitrator or board of arbitrators, to which
Seller is a party, affecting the Products or the Purchased Assets as of
the date hereof. There is no action, suit or proceeding threatened or
pending before any court or governmental authority which would give
Seller the right to rescind or enjoin this transaction. To Seller's
knowledge, there is no administrative or government agency proceeding
or review of the Products, nor (i) any administrative action or review
threatened against Seller in connection with the Products or Seller's
production or marketing of the Products, or (ii) any pending or
planned recall, whether voluntary or involuntary, of any of the
Products.
4.7 Products and Warranties. There is, to the best of Seller's knowledge,
no pending legislation, ordinance or regulation which if adopted or
enacted would have a materially adverse effect upon the Products. The
Products conform in all material respects to all literature, product
descriptions, or other Products-pertinent written material of Seller,
and any Products warranty granted by Seller therewith.
4.8 Confidential Information. Seller has exerted, and will, to the extent
specified in Article 6.2 below, continue to exert, its best effort to
maintain the confidentiality of the Intellectual Property, and Seller
has not sold, transferred, assigned, licensed or disclosed any such
Intellectual Property to any third party, except to its employees,
independent contractors, affiliates and customers as necessary in the
ordinary course of its operation of its business under obligation of
confidentiality.
4.9 Compliance with Laws. The Products are in compliance in all material
respects with all applicable Federal, State and local rules, laws and
regulations in effect as of the date of this Agreement.
4.10 Misstatements or Omissions. No representations or warranties made by
Seller in this Agreement contain or will contain as of the Closing Date
any untrue statement of a material fact, or omit or will omit as of the
Closing Date to state a material fact necessary to make the statements
of facts contained therein not materially misleading. All statements
made and data presented by Seller in any certificate, Schedule,
Exhibit, chart, list, letter, compilation or other document provided to
Purchaser constituting a Schedule or Exhibit attached to this Agreement
are deemed to be representations and warranties made by Seller to
Purchaser under this Agreement.
4.11 Absence of Undisclosed Liabilities. Except as and to the extent of the
amounts specifically reflected in the Contracts assumed by Purchaser,
Seller does not have any liabilities or obligations of any nature
whatsoever, due or to become due, accrued, absolute, contingent or
otherwise, relating in any manner to the Purchased Assets and Assumed
Liabilities except for liabilities and obligations incurred in the
ordinary course of business.
4.12 Accounts Receivable. All receivables included as part of the Business
have arisen from bona fide transactions in the ordinary course of
business, represent valid obligations, and shall be fully collected in
the aggregate face amounts thereof and are owned by Seller and will be
transferred to Purchaser free of all claims.
4.13 Balance Sheet. The August 31, 2000 Balance Sheet used by the parties
for initial discussion purposes only ("the Balance Sheet") was prepared
from the books and records of Seller and is complete and correct in all
material respects and is attached hereto as Schedule 4.13.
5. Representations and Warranties of Purchaser.
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Purchaser represents and warrants to Seller as follows:
5.1 Existence and Good Standing. Purchaser is a corporation duly organized,
validly existing and in good standing under the laws of the State of
Ohio and is qualified to do business and is in good standing in every
jurisdiction where the failure to be so qualified would have a material
adverse effect upon the Seller .
5.2 Authority of Purchaser; Consents. The execution, delivery and
consummation of this Agreement and the transactions contemplated hereby
by Purchaser has been duly authorized by its Board of Directors in
accordance with all applicable laws and the Certificate of
Incorporation and Bylaws of Purchaser, and no further corporate action
will be necessary on the part of Purchaser to make this Agreement valid
and binding upon Purchaser and enforceable against Purchaser in
accordance with its terms. No approval or consent of any person, firm
or governmental agency, division or office is required to be obtained
by Purchaser for the authorization of this Agreement or the
consummation of the transactions contemplated by this Agreement.
5.3 No Conflicts. The execution and delivery of this Agreement, the
consummation of Agreement will not constitute a default under or
conflict with any judgment, decree or order or award of any court or
other governmental body, or any agreement or understanding to which
Purchaser is a party.
5.4 Litigation. To the best of Purchaser's knowledge there are no actions,
suits or proceedings threatened or pending before any court or
governmental authority which would give Purchaser the right to rescind
or enjoin this transaction.
6. Covenants of the Parties.
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6.1 Seller's Covenant Not To Compete. Seller will not, from the Closing
Date, directly or indirectly engage in any of the following conduct:
(a) Solicit customers or potential customers of Purchaser, or sell
distribute, deliver or market any of the acquired Business or
Products of Purchaser, or any product which is similar to or
competes with or performs substantially the same functions as the
acquired Business or Products produced by Purchaser (except as
they pertain to the Clinical Products or the Clinical Business
(each as hereinafter defined) to the customers or potential
customers of Purchaser either on their own behalf or on behalf of
any person, firm, partnership, association or corporation other
than Purchaser;
(b) Financially or otherwise, on its own behalf, or as a contractor,
consultant, owner, or in any other capacity for any person, firm,
partnership, association or corporation, other than Purchaser,
participate in any kind of business venture (i) which is engaged
in the same Business as Purchaser, and/or (ii) which markets,
sells or seeks to sell one or more products which is similar to
or competes with or performs substantially the same functions as
the acquired Business or Products of Purchaser to the customers
or potential customers of Purchaser (except with respect to
Clinical Products or the Clinical Business) ; or
(c) For a five (5) year period following the Closing Date solicit or
cause to be solicited on behalf of themselves individually and/or
collectively or on behalf of any person or entity other than
Purchaser (i) any Key Employee who is employed by Purchaser at
the time of Closing or (ii) any other person who is employed by
Purchaser and/or any of its Affiliates. For purpose of this
Agreement, "Affiliates" means, with respect to any Person, any
other Person directly or indirectly controlling, controlled by or
under common control with such Person. For purposes of the
immediately preceding sentence, the term "control" (including,
with correlative meanings, the terms "controlling", "controlled
by" and "under common control with"), as used with respect to any
Person, means the possession, directly or indirectly, of the
power to direct or cause the direction of the management and
policies of such Person, whether through ownership of voting
securities, by contract or otherwise; and "Person" means any
individual, partnership, corporation, limited liability entity,
trust, joint venture, unincorporated organization or other
entity.
6.2 Purchaser's Covenant Not To Compete. Purchaser hereby agrees that it
will not for a period of two (2) years following the Closing Date,
directly or indirectly, engage in any of the following conduct as it
pertains to the Seller's business of developing, producing,
manufacturing and selling software for the automation of clinical
trials processes (the "Clinical Products"), including, without
limitation, processes that support the supply of Clinical Products to
clinical trials, from the receipt of raw materials, through shipping
and distribution of packaged product (the "Clinical Business"):
(a) Solicit customers or potential customers of Seller's Clinical
Business, or sell distribute, deliver or market any of the
Clinical Products of Seller, or any product which is similar to
or competes with or performs substantially the same functions as
Clinical Products produced by Seller, to the customers or
potential customers of Seller either on their own behalf or on
behalf of any person, firm, partnership, association or
corporation other than Seller; and
(b) Financially or otherwise, on its own behalf, or as a contractor,
consultant, owner, or in any other capacity for any person, firm,
partnership, association or corporation, other than Seller,
participate in any kind of business venture (i) which is engaged
in the same Clinical Business as Seller, and/or (ii) which
markets, sells or seeks to sell one or more products which is
similar to or competes with or performs substantially the same
functions as the Clinical Business or Clinical Products of Seller
to the customers or potential customers of Seller.
6.3 Confidentiality. Seller hereby acknowledge Purchaser's lawful right to
protect its confidential information. For purposes of this Agreement,
"Confidential Information" shall mean customer lists, customer contact
names, Intellectual Property, new Product information as of Closing
Date, Product design information, Product process information, cost
lists, and trade secrets related to the Business. Excluded from
"Confidential Information" shall be any information which is (a) in the
public domain as of the date of Closing or which becomes public
thereafter through no action of the party hereto claiming the
exception, (b) already known as of the Closing Date by the party
claiming the exception, and/or (c) received by the party claiming the
exception from a third party which is not, to the extent the party
claiming the exception's reasonable inquiry can determine, under
obligation of confidentiality to the other party hereto with respect to
the claimed excluded information. Accordingly, except with respect to
Seller's filings and disclosures with Federal, State and/or local
regulatory agencies, shareholders, securities exchanges and/or markets,
Seller agrees not to reveal to any person any Confidential Information
or any other information relating to the Business and or Products which
either belongs to Purchaser or to third parties without the prior
written consent of Purchaser which may be withheld for any reason nor
to use any such Confidential Information in whole or in part for
themselves individually, jointly or for the benefit of others.
6.4 Enforcement. Seller and Purchaser hereby agree that in the event of
breach or attempted breach of any of the covenants contained in this
Article 6 will cause the other party irreparable loss and injury which
is not susceptible of monetary compensation. Seller and Purchaser each
hereby agree that such provisions may be enforced by the other party by
injunctive relief and hereby further consent to the issuance thereof.
Such relief shall be in addition to any other rights at law or in
equity to which a party may be entitled.
6.5 Notice to Customers. Seller, if requested by Purchaser, for a period of
three (3) months after the Closing Date, agrees to reasonably assist
Purchaser in notifying (including by means of visits to customers), at
the expense of Purchaser, Seller's customers for the Products and
certain third parties identified by Purchaser, of the transfer to
Purchaser of Seller's rights and interest in, to and under the backlog,
contracts, commitments, letters of intent and proposals of Seller
included in the Purchased Assets.
6.6 Transfer Taxes. All sales, value added, use, transfer, registration,
stamp and similar taxes imposed in connection with the transactions
contemplated hereby shall be borne by Seller. Notwithstanding the
foregoing, Seller hereby represents and warrants that no bulk sales tax
is payable in connection with the transactions contemplated hereby and
that there are no claims of creditors in the nature of bulk sales which
are pending or threatened and that Seller knows of no basis for such a
claim.
6.7 Intellectual Property. Purchaser hereby agrees to assume all costs of,
and responsibility for, (i) recording the assignments of the
Intellectual Property listed on Schedule 1.1(h) hereof, and (ii)
renewing the registrations of all such Intellectual Property. Seller
hereby agrees to execute all assignments related to such Intellectual
Property that is prepared, and presented to Seller, by Purchaser, and
to reasonably cooperate with Purchaser to facilitate Purchaser's
efforts to record such assignments and renew such registrations.
7. Condition Precedent to Closing.
------------------------------
7.1 Purchaser's obligation to consummate the transactions contemplated
herein shall be subject to the following conditions precedent each of
which must be fulfilled prior to Purchaser being obligated to
consummate the transactions contemplated herein. If any of the
following conditions precedent are not fulfilled on or before Closing
Date, or if Purchaser, in Purchaser's reasonable discretion, determines
that any of the following conditions precedent are not capable of being
fulfilled on or before Closing Date, then Purchaser may terminate this
Agreement without any liability to Seller or any other party:
(a) As of the Closing Date, Purchaser shall have received from all
Key Employees executed employment contracts or other retention
and non-competition agreements, in form and substance
satisfactory to and in the sole discretion of Purchaser.
(b) The representations and warranties of Seller set forth herein
shall be true and correct in all material respects as of the date
of this Agreement and as of the Closing as though made on and as
of the Closing, and Purchaser shall have received a certificate
signed by an officer of Seller to that effect at Closing.
(c) Seller shall have performed all obligations required to be
performed by it under this Agreement prior to the Closing and
Purchaser shall have received a certificate signed by an officer
of Seller to that effect at Closing.
(d) Purchaser shall have received appropriate evidence of all
necessary corporate action by Seller in connection with the
transactions contemplated by this Agreement, to consist of
certified copies of resolutions duly adopted by the Board of
Directors of Seller, approving the transactions contemplated by
this Agreement and authorizing the execution, delivery and
performance by Seller of this Agreement and certificates as to
the incumbency and authority of officers of Seller executing this
Agreement and any instrument, or other document delivered in
connection with the transactions contemplated hereby.
(e) Purchaser shall have received an opinion of counsel for Seller
dated the date of the Closing and addressed to Purchaser to the
effect that:
(i) Seller is a corporation validly existing and in good
standing under the laws of the State of New Jersey and has
all requisite corporate power and authority to own, lease
and operate its properties and to carry on its business as
now being conducted;
(ii) Seller has full corporate power, authority and legal right
to execute and deliver, and to carry out the transactions
contemplated by this Agreement and the agreements, documents
and instruments to be executed and delivered by Seller
hereto; all corporate actions required to be taken by or on
the part of Seller to authorize it to execute and deliver
this Agreement and such documents and instruments, and to
consummate the transactions as contemplated thereby, have
been duly and validly taken, and this Agreement and the
documents and instruments to be executed and delivered by
Seller pursuant thereto have been duly and validly
authorized, executed and delivered by Seller and constitute
the valid and binding obligation of Seller enforceable in
accordance with their respective terms.
(iii)The execution and delivery by Seller of this Agreement and
the agreements, documents and instruments to be executed and
delivered by Seller pursuant hereto, the consummation by
Seller of the transactions contemplated thereby and
compliance by Seller with the provisions thereof will not
conflict with or result in a breach of any provision of the
Articles of Incorporation or By-Laws of Seller, or to the
best of such Counsel's knowledge violate any court order,
writ, injunction or decree applicable to Seller or any of
its properties or assets.
(iv) Such counsel is not aware of actions, suits or proceedings
pending or threatened, before any court against Seller which
seek to prevent the consummation of the transactions
contemplated by this Agreement.
(v) Such counsel is not aware of any orders of any court or
governmental agency that will be in effect which restrains
or prohibits the consummation of the transactions
contemplated by this Agreement. Such counsel is not aware of
any action, suit or other proceeding that is pending before
any court, tribunal or governmental authority seeking or
threatening to restrain or prohibit the consummation of the
transactions contemplated by this Agreement, or seeking to
obtain substantial damages in respect thereof, or involving
a claim that consummation thereof would result in the
violation of any law, decree or regulation of any
governmental authority having appropriate jurisdiction.
(f) As of the Closing Date, Seller will have obtained all other
necessary consents and approvals of all persons, firms, entities
and governmental authorities, if any, required by this Agreement.
(g) Purchaser shall have received the approval of its Board of
Directors to consummate the transaction contemplated herein.
7.2 Seller's obligation to consummate the transactions contemplated herein
shall be subject to the following conditions precedent each of which
must be fulfilled prior to Seller being obligated to consummate the
transactions contemplated herein:
(a) The representations and warranties of Purchaser set forth herein
shall be true and correct in all material respects as of the date
of this Agreement and as of the Closing as though made on and as
of the Closing, and Seller shall have received a certificate
signed by an officer of Purchaser to that effect at Closing.
(b) Purchaser shall have performed all obligations required to be
performed by it under this Agreement prior to the Closing and
Seller shall have received a certificate signed by an officer of
Purchaser to that effect at Closing.
(c) Seller shall have received appropriate evidence of all necessary
corporate action by Purchaser in connection with the transactions
contemplated by this Agreement, to consist of certified copies of
resolutions duly adopted by the Board of Directors of Purchaser,
approving the transactions contemplated by this Agreement and
authorizing the execution, delivery and performance by Purchaser
of this Agreement and certificates as to the incumbency and
authority of officers of Purchaser executing this Agreement and
any instrument, or other document delivered in connection with
the transactions contemplated hereby.
(d) Seller shall have received an opinion of counsel for Purchaser
dated the date of the Closing and addressed to Seller to the
effect that:
(i) Buyer is a corporation validly existing and in good standing
under the laws of the State of Ohio and has all requisite
corporate power and authority to own, lease and operate its
properties and to carry on its business as now being
conducted.
(ii) Buyer has full corporate power, authority and legal right to
execute and deliver, and to carry out the transactions
contemplated by this Agreement and the agreements, documents
and instruments to be executed and delivered by Purchaser
hereto; all corporate actions required to be taken by or on
the part of Purchaser to authorize it to execute and deliver
this Agreement and such documents and instruments, and to
consummate the transactions as contemplated thereby, have
been duly and validly taken, and this Agreement and the
documents and instruments to be executed and delivered by
Purchaser pursuant thereto have been duly and validly
authorized, executed and delivered by Purchaser and
constitute the valid and binding obligation of Purchaser
enforceable in accordance with their respective terms.
(iii)The execution and delivery by Purchaser of this Agreement
and the agreements, documents and instruments to be executed
and delivered by Purchaser pursuant hereto, the consummation
by Purchaser of the transactions contemplated thereby and
compliance by Purchaser with the provisions thereof will not
conflict with or result in a breach of any provision of the
Articles of Incorporation or By-Laws of Purchaser, or to the
best of such Counsel's knowledge violate any court order,
writ, injunction or decree applicable to Purchaser or any of
its properties or assets.
(iv) Such counsel is not aware of actions, suits or proceedings
pending or threatened, before any court against Purchaser
which seek to prevent the consummation of the transactions
contemplated by this Agreement.
(v) Such counsel is not aware of any orders of any court or
governmental agency that will be in effect which restrains
or prohibits the consummation of the transactions
contemplated by this Agreement. Such counsel is not aware of
any action, suit or other proceeding that is pending before
any court, tribunal or governmental authority seeking or
threatening to restrain or prohibit the consummation of the
transactions contemplated by this Agreement, or seeking to
obtain substantial damages in respect thereof, or involving
a claim that consummation thereof would result in the
violation of any law, decree or regulation of any
governmental authority having appropriate jurisdiction.
7.3 The parties shall further deliver such additional documents,
resolutions, certificates and instruments as any party or its
counsel reasonably requests to facilitate the consummations of
the transaction contemplated hereby.
8. Closing.
-------
The Closing shall take place at the office of Seller in Norwalk, Connecticut at
1:00 a.m. local time on October 10, 2000 or such later date as the parties shall
mutually agree in writing (the "Closing Date"). By mutual agreement, the Closing
may be conducted by facsimile exchange of documents with originals dispatched by
courier on the date of Closing.
8.1 Deliveries of Seller at Closing.
(a) Such bills of sale, assignments and other instruments of transfer
required to effectively transfer and assign good and marketable
title to all of the Purchased Assets to Purchaser in accordance
with this Agreement;
(b) All other necessary consents and approvals of all persons, firms,
entities and governmental authorities required by this Agreement;
(c) Certified copies of resolutions duly adopted by the Board of
Directors of Seller approving this Agreement and the transactions
contemplated hereby;
(d) Recordable assignments to Purchaser of all registered
Intellectual Property in a form which may be registered with a
public office to transfer good title thereto;
(e) The opinion of counsel per the provisions of Article 7.1 hereof.
(f) Delivery of all Purchased Assets to a place designated by
Purchaser.
8.2 Deliveries of Purchaser at Closing.
(a) Payment of the Purchase Price, in accordance with Article 3
hereof;
(b) The opinion of counsel and such other documents and instruments
as are specified in Article 7.2 hereof.
8.3 Post-Closing Obligations of Purchaser
Purchaser shall, following the Closing, give to Seller and its
authorized representatives such access, during normal business hours
and upon prior notice, to such books and records constituting the
Purchased Assets, in connection with the preparation and filing of tax
returns for periods prior to the Closing Date and to make extracts and
copies of such books and records with respect thereto at the expense of
Seller. Purchaser agrees that it shall not destroy or cause to be
destroyed, for a period of three years after the Closing Date, any such
books or records.
9. Indemnifications; Survival of Representations and Warranties and
Indemnifications.
-----------------------------------------------------------------
9.1 Indemnification by Seller. Seller agrees to defend, indemnify and hold
Purchaser and its officers, directors, employees, shareholders, agents,
legal representatives, Affiliates, successors and assigns, harmless of,
from and against any loss, claim, damage, liability, penalty or other
cost or expense (including reasonable attorneys' fees and costs)
incurred or sustained by any of them, at any time, on account of or
relating to:
(a) Any misrepresentation by Seller hereunder, or the breach by
Seller of any term, warranty, covenant, or agreement contained in
this Agreement or other document delivered pursuant hereto; or
(b) Except with respect to the customer contracts specified on
Schedule 2.1(a) hereof, Products manufactured by Seller sold
prior to the Closing Date, and any warranty granted by Seller,
whether express or implied, with respect to such Products,
including
(i) The implied warranties of merchantability and fitness for a
particular purpose, and
(ii) Any action in which it is alleged that any Product
manufactured by Seller prior to the Closing Date was is
unsafe, inherently dangerous or defectively designed,
manufactured or packaged; or
(iii)The alleged infringement by the Intellectual Property of
the patent, trademark, service mark, trade name, or
registered copyright of any third party.
9.2 Indemnification by Purchaser. Purchaser hereby agrees to defend,
indemnify and hold Seller and its employees, agents, legal
representatives, affiliated entities, successors and assigns, harmless
of, from and against any loss, claim, damage, liability, penalty or
other cost or expense (including reasonable attorneys' fees and costs)
incurred or sustained by any of them, at any time, on account of or
relating to:
(a) Any material misrepresentation by Purchaser hereunder, or the
breach by Purchaser of any term, warranty, covenant, or agreement
contained in this Agreement or other document delivered pursuant
hereto; or
(b) The ownership and/or operation by Purchaser of the Purchased
Assets and/or any part thereof, its business and affairs
following the Closing Date, including, without limitation, any
and all materials, products (including the Products), goods or
services, manufactured, processed, assembled, sold, supplied,
generated, transported, delivered or placed in commerce by
Purchaser following Closing Date.
9.3 Claim Procedure. If any claim is asserted after the signing of this
Agreement against either Seller or Purchaser for which indemnification
may be sought under the provisions of this Section 9, Seller or
Purchaser shall promptly notify the other in writing of such claim and
the indemnifying party shall thereafter undertake the defense of such
claim, with counsel acceptable to the indemnified party, which will not
be unreasonably withheld; provided, that, if Seller is the indemnifying
party and such counsel is determined by Seller's insurance carrier, the
determination by such insurance carrier shall be final. If the party
responsible for indemnifying the other party hereunder does not
promptly undertake the defense of any claim hereunder, then the
indemnified party may undertake the defense of such claim itself, with
counsel of its or his own choosing, and the indemnifying party shall
reimburse the indemnified party for all costs and expenses, including
court costs and reasonable attorneys fees, incurred by such party in
defending and resolving such claim, which shall be reimbursed from time
to time upon the indemnified party giving the indemnifying party an
invoice for the same. Both parties agree to provide the other party
such assistance as the other party may reasonably request in order to
defend, settle or compromise any claim hereunder, and neither party
shall settle or compromise any claim under this Section without the
consent of the other party, which consent shall not be unreasonable
withheld.
9.4 Survival of Representations. The representations, warranties, and
agreements of the Parties contained in this Agreement and the Schedules
hereto or in any instrument or document furnished in connection with
this Agreement or the transaction contemplated hereby shall survive the
Closing and any investigation at any time made by or on behalf of any
Party and, unless otherwise specially provided to the contrary, shall
continue in full force and effect for a period of three (3) years from
the Closing Date, provided, however, that any claims asserted in
writing prior to the expiration of the survival period shall survive
until finally resolved and satisfied in full.
10. Belgian Key Employees and Use of Belgian Facilities.
----------------------------------------------------
10.1 Use of Leased Belgian Employees. Seller shall lease to Purchaser the
employees of Seller listed on Schedule 10.3 hereof, who are primarily
based in Seller's Belgium offices (the "Leased Belgian Employees"),
on the terms and conditions set forth herein.
10.2 Use of Seller's Facilities. Seller shall permit Purchaser to occupy
the portion of Seller's office facility in Belgium (the "Belgium
Office") as was previously utilized by the Leased Belgian Employees,
on the terms and conditions set forth herein.
10.3 Purchaser's Reimbursement of Seller. Purchaser shall pay Seller
$71,101.00 per calendar month (or pro-rata or any portion of a
calendar month based upon actual days assuming a month of thirty (30)
days) for Purchaser's use of the Leased Belgian Employees and the
Belgium Office, which includes occupancy payments for the portion of
the Belgium Office and all other customary and related office
expenses, including, without limitation, utilities, local telephone
use, office machinery and office supplies, utilized by the Leased
Belgian Employees or employees or agents of Purchaser, as set forth
on Schedule 10.3 hereof (the "Belgium Costs"), and shall reimburse
Seller for any travel and out-of-pocket expenses incurred by Seller
after Closing as a result of reimbursing the Leased Belgian Employees
for such expenses; provided, that, all business related travel
expenses and other out of pocket expenses ("Approved Expenses") must
be agreed upon and approved by Purchaser and Seller (with Seller
acting through the Chief Executive Officer of Seller ("Seller's CEO")
or through such other employee of Seller as may be determined by
Seller's CEO). Seller shall not be required to issue invoices to
Purchaser for payment of the Belgium Costs; provided, that, Seller
shall submit invoices to Purchaser for all Approved Expenses that are
incurred by any Leased Belgian Employee and paid by Seller, and
Purchaser shall reimburse Seller for such amounts no later than 30
days after the date of such invoice. Purchaser shall pay the Belgium
Costs to Seller no later than the 20th day of the month prior to such
calendar month, except that for the month of October 2000, Purchaser
shall pay the Belgium Costs to Seller no later than October 16, 2000.
10.4 Termination. In the event that Purchaser terminates its use of the
Belgium Office or any of the Leased Belgian Employees, Purchaser
shall pay to Seller the pro rata portion of the monthly costs owed to
Seller, based on a 30 day month, on the date of termination (the
"Termination Balance"). However, such pro-ration of the Belgium Costs
shall continue to be incurred by the Purchaser day for day until
there is a complete vacation of the Belgium Office and termination of
the occupancy by Purchaser.
10.5 Indemnification.
(a) Purchaser will indemnify, defend and save harmless Seller from
and against any and all loss, damage, injury and property
liability and all claims or suits therefor by third parties,
employees or agents of Purchaser or by any Leased Belgian
Employee, when such loss, damage or liability is alleged to have
arisen from the performance of the Leased Belgian Employees while
assigned to Purchaser pursuant to this Article 10.
(b) With respect to Purchaser's occupancy of a portion of the Belgium
Office, as set forth herein, Purchaser shall, to the fullest
extent permitted by applicable law, indemnify and hold harmless
Seller for and against any and all claims, demands, damages,
losses, liabilities, costs or expenses (including, without
limitation, attorneys' fees and expenses) (collectively,
"Occupancy Related Costs") incurred or suffered by Seller as a
result of Purchaser's occupancy of the Belgium Office, including
any injuries suffered by any employees or invitees of Purchaser,
including the Leased Belgian Employees, on the premises and any
damage to property caused by any employees or invitees of
Purchaser, including the Leased Belgian Employees. Purchaser
shall ensure that all employees and invitees of Purchaser,
including the Leased Belgian Employees, shall follow all
reasonable rules of conduct and deportment on the premises, and
neither Purchaser nor Purchaser's employees, including the Leased
Belgian Employees, shall take any action in violation of
applicable law relating to the premises. The indemnity contained
in this Section 10.5(b) shall not relate to claims or liabilities
that arise out of or relate to the acts, errors or omissions of
Seller, its employees (except the Leased Belgian Employees) and
invitees.
(c) In no event shall either Seller or Purchaser be liable to the
other for claims of indirect, special, incidental or
consequential damages of any kind or nature arising out of or
related to the provisions provided in this Section 10.5.
10.6 Compensation of Leased Belgian Employees. For so long as Purchaser
continues to lease the Leased Belgian Employees from Seller (the
"Term"), Seller shall provide for and/or pay the Leased Belgian
Employees the compensation, employee benefits, workers' compensation
benefits, bonuses in accordance with Seller's normal practices and
Approved Expenses which are earned, accrued or incurred by or become
payable to such Leased Belgian Employees with respect to their
employment by Seller during the Term under Seller's applicable plans,
programs, policies and procedures or which are required by law.
Purchaser shall reimburse Seller for all such approved business
related travel expenses which are incurred by any Leased Belgian
Employee during the Term.
10.7 Employment Taxes. Seller shall be responsible for any withholding or
employment taxes with respect to any Leased Belgian Employees which
accrue or become payable with respect to such employee's employment
by Seller during the Term.
10.8 Replacement of Employees. Seller shall have no obligation to replace
any Leased Belgian Employee if such employee terminates his
employment with Seller, or has his employment terminated by
Purchaser, during the Term.
10.9 Intellectual Property. For the purposes of this Section, any
inventions, discoveries, improvements, designs, written materials,
computer programs, developed in the course of the provision of Leased
Employee Services by any of the Leased Belgian Employees during the
Term relative to the Business which belongs to the Seller is referred
to herein as the "Seconded Leased Belgian Employee Intellectual
Property." Seller hereby assigns to Purchaser all of its rights,
title and interest in any Seconded Leased Belgian Employee
Intellectual Property.
10.10 Offers of Employment. At any time on or before January 2, 2001
(unless otherwise agreed upon by the parties hereto), Purchaser may
negotiate with, and offer employment to, the Leased Belgium
Employees.
10.11 Leased Personal Property. In the event Purchaser enters into an
employment contract or other retention agreement with a Leased
Belgian Employee, the equipment relating to such Leased Belgian
Employee, as set forth on Schedule 1.1(b) hereof, shall be
transferred and assigned to Purchaser, with full rights and title to
thereto, at such time, without any additional compensation to Seller.
Seller shall provide Purchaser with an appropriate bill of sale for
said equipment at such time. At such time as Purchaser hires or
otherwise retains any Leased Belgian Employee, Purchaser shall assume
the lease for such Leased Belgian Employee's vehicle, if any, as set
forth on Schedule 1.1(d) hereof. The salary and vehicle lease of any
Leased Belgian Employee who is hired or otherwise retained by
Purchaser shall be eliminated from Schedule 11.1 hereof (i) upon
Purchaser hiring or otherwise retaining such Leased Belgian Employee,
or (ii) at such time as such Leased Belgian Employee's status as a
leased employee otherwise terminates.
11. Miscellaneous.
-------------
11.1 Seller shall subcontract to Purchaser, on the terms hereinafter set
forth, all of Seller's performance requirements under each of the
customer contracts set forth on Schedule 11.1 hereof and any
contracts so added pursuant to Section 1.1(f) hereof (the
"Subcontracted Contracts").
(a) Purchaser shall perform the Subcontracted Contracts in accordance
with their respective terms.
(b) Purchaser shall, at its election, which may be a separate
election as to each Subcontracted Contract, either (i) directly
invoice customers under each Subcontracted Contract for
Purchaser's own account, and Purchaser shall retain all funds
received from such customers under such agreements, or (ii)
furnish complete invoices relating to Subcontracted Contracts to
Seller for Seller to promptly render to such respective
customers, and Seller shall, upon receipt of any funds from any
such customer, promptly remit such amounts, in full, to
Purchaser.
(c) Purchaser shall be solely responsible for all direct performance
liabilities and obligations of Seller that arose, or may arise,
out of any Subcontracted Contract at any time before, on, or
after the Closing Date, including financial responsibility for
the costs to correct defects and/or functionality deficiencies in
(i) products of the Business manufactured or supplied, (ii)
products sold, or (iii) services performed by Seller under any
such Subcontracted Contract. Notwithstanding such assumption of
liability under any Subcontracted Contract for direct damages and
for incidental, indirect, special or consequential damages of any
kind or nature (the "Subcontracted Contract Damages"), regardless
of the form of action, Purchaser shall not be responsible for any
Subcontracted Contract Damages incurred before, on, or after the
Closing Date; provided, that, for all Subcontracted Contract
Damages arising out of any Subcontracted Contract, Purchaser
shall be liable only to the extent of the lesser of (y) $250,000,
and (z) the total amount of fees received by Purchaser from such
customer for the products and services provided by Purchaser to
such customer under the scope of work of such Subcontracted
Contract as in effect as of the Closing Date. Seller shall
defend, indemnify and hold Purchaser harmless from all
liabilities in excess of the foregoing limitation of liability
and Purchaser, its parent(s) and subsidiaries shall be named as
an additional insured under the Software Errors and Omissions
Insurance Policy maintained by Seller to the extent of said
indemnity obligation. Seller or its insurer, shall provide
Purchaser with evidence of such insurance, and written notice of
any cancellation, non-renewal or material change in said
insurance no less than sixty (60) days prior to such
cancellation, non-renewal or change. Seller will waive its rights
of recovery and its insurers rights of subrogation against
Purchaser, its parent(s) and subsidiaries for liability in excess
of the foregoing limitation of liability.
(d) In the event that any Subcontracted Contract is terminated and
Purchaser enters into a new agreement with any customer that is a
party to a Subcontracted Contract, Purchaser shall use its
reasonable efforts to assure that the existing Subcontracted
Contract is terminated in full, without any continuing
responsibility by Seller for any act committed with respect to
such agreement. In the event that any Subcontracted Contract is
modified in any respect which changes the scope of work under
such contract as in effect as of the Closing Date, or in the
event that with respect to such contract, a new product version
is released or some other work is performed by Purchaser that is
not necessary to satisfy the original obligations of Seller under
the Subcontracted Contract on the Closing Date, then with respect
to which release Purchaser and customer will enter into a new
contract and Seller shall have no further liability with respect
to such new contract.
11.2 Binding Effect. This Agreement shall be binding upon and inure to the
benefit of Seller and Purchaser, their respective heirs, personal
representatives, successors and assigns.
11.3 Assignment. This Agreement shall not be assigned by Seller without
the prior written consent of Purchaser. Purchaser may assign this
Agreement upon notice to Seller to any Affiliate.
11.4 Notices. All notices and communications required or permitted to be
given pursuant to this Agreement shall be in writing and shall be
deemed effectively given in all respects: (i) when received, if
manually delivered; (ii) when delivered on the date indicated on a
return receipt, if posted by either registered or certified U.S.
Mail, return receipt requested, or by a next day delivery service
which maintains records of the time, place and recipient of delivery;
or (iii) upon delivery as reflected in the confirmation if sent by
confirmed facsimile transmission, and in each case if directed to the
party at the address and/or facsimile transmission number set forth
below, or to such other address or facsimile transmission designated
by any party in accordance with this Section 10.
<TABLE>
<CAPTION>
If to Purchaser to: If to Seller to:
------------------ ----------------
<S> <C>
ABB Automation, Inc. Base Ten Systems, Inc.
P.O. Box 5308 One Electronics Drive
501 Merritt 7 Trenton, New Jersey 08619
Norwalk, CT 06851 Attn: Stephen A. Cloughley, President and CEO
Attn: Ulf Lilja, Chief Operating Officer Fax No. (609) 586-3677
Fax No. (203) 750-7706
With a copy to: With a copy to:
-------------- --------------
Eugene Madara
Vice President, General Counsel and Secretary Pitney, Hardin, Kipp & Szuch LLP
P.O. Box 5308 P.O. Box 1945
501 Merritt 7 Morristown, New Jersey 07962-1945
Norwalk, CT 06851 Attn: Joseph Lunin
Fax No. (203) 750-7706 Fax No. (973) 966-1550
</TABLE>
11.5 Amendments. No modifications or amendments of this Agreement shall be
effective unless made in writing and signed by the respective duly
authorized representatives of both Seller and Purchaser.
11.6 Governing Law. This Agreement shall be construed and enforced in
accordance with the laws of the State of New York, without regard to
the conflicts of laws rules thereof.
11.7 Counterparts. This Agreement may be executed in two or more
counterparts, each of which shall be deemed an original, but all of
which together shall constitute one and the same instrument.
11.8 Entire Agreement. This Agreement, together with the Exhibits attached
hereto, embodies the entire agreement and understanding between the
parties hereto and supersedes all prior and contemporaneous oral or
written agreements and understandings relating to the subject matter
hereof. No statement, representation, warranty, covenant or agreement
of any kind not expressly set forth in this Agreement shall affect,
or be used to interpret, change or restrict, the express terms and
provisions of this Agreement.
11.9 Waivers and Consents. The terms and provisions of this Agreement and
any right or remedy of any party hereunder may be waived or consent
for the departure therefrom granted only by written document executed
by the party entitled to the benefits of such terms or provisions of
this Agreement. Each such waiver or consent shall be effective only
in the specific instance and for the purpose for which it was given,
and shall not constitute a continuing waiver or consent.
11.10 Headings and Captions. The headings and captions of the various
subdivisions of this Agreement are for convenience of reference only
and shall in no way modify or affect the meaning or construction of
any of the terms or provisions hereof.
11.11 Expenses. Each of the parties hereto shall pay its or his own fees
and expenses (including the fees of any attorneys, accountants,
appraisers or others engaged by such party) in connection with this
Agreement and the transactions contemplated hereby. The parties
acknowledge that no brokers were involved with this transaction.
11.12 Recitals. The recitals set forth at the beginning of this Agreement
are an integral part of the terms of this Agreement and are hereby
incorporated into the body of this Agreement by this reference
thereto.
11.13 Attorneys' Fees. If either party shall bring any action against the
other under this Agreement, the prevailing party in such action shall
be entitled to reimbursement of all court costs and reasonable
attorneys' fees incurred by such party in enforcing its rights
hereunder.
<PAGE>
IN WITNESS WHEREOF, the parties have duly executed this
Agreement as of the date first written above.
PURCHASER: SELLER:
ABB AUTOMATION, INC. BASE TEN SYSTEMS, INC.
__________________________________ ________________________________
By: By:
Titl Title:
