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EXHIBIT 10.1
AGREEMENT FOR THE EXCHANGE OF SHARES
BETWEEN
THE RAJENDRA B. VATTIKUTI TRUST UAD
DATED OCTOBER 19, 1990, AS AMENDED
AND
COMPLETE BUSINESS SOLUTIONS, INC.
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TABLE OF CONTENTS
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ARTICLE ONE - DEFINITIONS................................................................................1
1.1 1933 Act........................................................................................1
1.2 Affiliate.......................................................................................2
1.3 Agreement.......................................................................................2
1.4 Buyer...........................................................................................2
1.5 CBSI............................................................................................2
1.6 CBSI Competitive Activity.......................................................................2
1.7 CBSI Plan.......................................................................................2
1.8 CBSI Superior Proposal..........................................................................2
1.9 Closing.........................................................................................2
1.10 Closing Date.................................................................................2
1.11 COBRA........................................................................................2
1.12 Code.........................................................................................2
1.13 Code Section 125 Plan........................................................................3
1.14 ERISA........................................................................................3
1.15 Exchange Common Stock........................................................................3
1.16 Financial Advisor............................................................................3
1.17 Indemnified Party............................................................................3
1.18 Indemnifying Party...........................................................................3
1.19 Indemnity Claim..............................................................................3
1.20 Knowledge....................................................................................3
1.21 Losses.......................................................................................3
1.22 Special Committee............................................................................4
1.23 Synova.......................................................................................4
1.24 Synova Common Stock..........................................................................4
1.25 Synova Competitive Activity..................................................................4
1.26 Threshold Amount.............................................................................4
1.27 Welfare Plan.................................................................................4
ARTICLE TWO - EXCHANGE OF SHARES.........................................................................4
2.1 Exchange of Shares..............................................................................4
ARTICLE THREE - THE CLOSING..............................................................................4
3.1 Time and Place of Closing.......................................................................4
3.2 Action to Be Taken..............................................................................5
3.3 Further Assurances..............................................................................5
ARTICLE FOUR - REPRESENTATIONS AND WARRANTIES OF CBSI....................................................5
4.1 Title to Shares.................................................................................5
4.2 Organization....................................................................................5
4.3 Necessary Authorization and Approval............................................................6
4.4 Third Party Consents and Approvals..............................................................6
4.5 Organization, Powers and Capitalization of Synova...............................................6
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4.6 Subsidiaries and Joint Ventures.................................................................6
4.7 Books and Records...............................................................................7
4.8 Tax Matters.....................................................................................7
ARTICLE FIVE - REPRESENTATIONS AND WARRANTIES OF BUYER...................................................7
5.1 Title to Common Stock...........................................................................7
5.2 Necessary Authorization or Approvals............................................................7
5.3 Third Party Consents and Approvals..............................................................8
5.4 Purchase for Investment.........................................................................8
5.5 Tax Matters.....................................................................................8
ARTICLE SIX - AGREEMENTS OF BUYER, CBSI AND SYNOVA.......................................................9
6.1 Consents; Preservation of Business..............................................................9
6.2 Reasonable Efforts..............................................................................9
6.3 Course of Conduct...............................................................................9
6.4 Trade Secrets...................................................................................9
6.5 Information.....................................................................................9
6.6 Non-Competition................................................................................10
6.7 Specific Enforcement...........................................................................11
6.8 Benefit Plans..................................................................................11
6.9 Additional Covenants of CBSI...................................................................12
6.10 Additional Covenants of Buyer and Synova....................................................12
6.11 Further Assurances..........................................................................12
ARTICLE SEVEN - CONDITIONS OF CLOSING...................................................................13
7.1 Conditions Precedent to the Obligations of the Buyer...........................................13
7.2 Conditions Precedent to the Obligations of CBSI................................................14
ARTICLE EIGHT - SURVIVAL OF REPRESENTATIONS, WARRANTIES AND
COVENANTS...........................................................................................15
8.1 Representations and Warranties.................................................................15
8.2 Survival of Covenants..........................................................................16
ARTICLE NINE - INDEMNIFICATION..........................................................................16
9.1 Indemnification By CBSI........................................................................16
9.2 Indemnification by Buyer.......................................................................16
9.3 Indemnification by Synova......................................................................16
9.4 Delivery of Claims Notice......................................................................17
9.5 Obligation to Defend...........................................................................17
9.6 Time Period for Asserting Indemnification......................................................17
ARTICLE TEN - TERMINATION OF AGREEMENT PRIOR TO CLOSING
DATE...............................................................................................18
10.1 Termination by Buyer or CBSI................................................................18
10.2 Termination by Buyer........................................................................18
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10.3 Termination by CBSI.........................................................................18
10.4 Effect of Termination.......................................................................19
ARTICLE ELEVEN - GENERAL................................................................................19
11.1 Amendment or Waiver.........................................................................19
11.2 Governing Law...............................................................................19
11.3 Brokers.....................................................................................19
11.4 Notices.....................................................................................20
11.5 Article, Section and Paragraph Headings.....................................................21
11.6 Counterparts................................................................................21
11.7 Successors and Assigns......................................................................21
11.8 Entire Agreement............................................................................21
SCHEDULE 4.4 Third Party Consents and Approvals..............................................23
SCHEDULE 6.6(b) Buyer Exceptions to Non-competition.............................................24
EXHIBIT 6.8(a)(i) Agreement.......................................................................25
SCHEDULE 6.9 Services Provided By CBSI.......................................................26
EXHIBIT 7.2(h) Synova Promissory Note..........................................................27
EXHIBIT 7.2(i)(a) Trust Guaranty..................................................................28
EXHIBIT 7.2(i)(b) Trust Pledge....................................................................29
EXHIBIT 7.2(i)(c) Trust Assignment Separate From Certificate......................................30
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AGREEMENT FOR THE EXCHANGE OF SHARES
This Agreement For The Exchange Of Shares dated September 25, 2000, is
by and among The Rajendra B. Vattikuti Trust UAD Dated October 19, 1990, as
amended, as Buyer, Synova, Inc., a Michigan corporation (only with respect to
Articles Six, Eight, Nine and Eleven) and Complete Business Solutions, Inc., a
Michigan corporation. Unless otherwise defined in this Agreement, capitalized
terms used in this Agreement shall have the meanings given to them in Article
One.
RECITALS
A. CBSI is the owner of all of the issued and outstanding capital stock
of Synova, Inc., a Michigan corporation.
B. Buyer is the record and beneficial owner of 9,361,759 outstanding
shares of CBSI Common Stock.
C. CBSI and Buyer wish to complete a transaction pursuant to which
Buyer would become the owner of all of the issued and outstanding capital stock
of Synova and would surrender to CBSI 750,000 shares of CBSI Common Stock owned
by Buyer, on the terms and conditions set forth herein.
D. The Special Committee, based in part upon a fairness opinion
received from the Financial Advisor, has approved, deemed it to be in the best
interests of the shareholders of CBSI, and recommended to the Board of Directors
of CBSI, that CBSI sell and transfer all of the issued and outstanding capital
stock of Synova to Buyer upon the terms and conditions set forth in this
Agreement.
E. The Board of Directors of CBSI, based on the unanimous
recommendation of the Special Committee, has approved and deems it advisable and
in the best interests of the shareholders of CBSI to sell and transfer all of
the issued and outstanding capital stock of Synova to Buyer as contemplated by
this Agreement.
F. The parties intend that the transaction contemplated hereunder
qualify as a non-taxable spin-off pursuant to the provisions of Section 355 of
the Code and the rules and regulations promulgated thereunder.
NOW THEREFORE, in consideration of the mutual agreements, covenants
and provisions herein contained, the parties agree as follows:
ARTICLE ONE
DEFINITIONS
As used herein, the following capitalized terms shall have the following
meanings:
1.1 "1933 ACT" means the Securities Act of 1933, as amended.
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1.2 "AFFILIATE" of a person means a person who controls, is controlled
by, or is under common control with such person. For purposes of this
definition, "control" means the ability to control the management or policies of
a person, whether through the ownership of voting securities, by contract or
otherwise.
1.3 "AGREEMENT" means this Agreement For The Exchange Of Shares.
1.4 "BUYER" means The Rajendra B. Vattikuti Trust UAD dated October 19,
1990, as amended, and Rajendra B. Vattikuti, as Trustee, and individually.
1.5 "CBSI" means Complete Business Solutions, Inc., a Michigan
corporation.
1.6 "CBSI COMPETITIVE ACTIVITY" means information technology services,
including: (a) emerging technologies; (b) information technology consulting; (c)
systems applications development and maintenance; (d) reengineering legacy
applications to client/server technology; (e) client/server applications
development; (f) packaged software implementation; and (g) web integration
activities; which are delivered either onsite at the client facility, offsite at
a local development facility or at an offshore development facility; provided
that CBSI Competitive Activity does not include information technology contract
programming services in the foregoing areas if such services are not provided to
clients or customers by Synova on a project basis in which Synova contracts to
supply deliverables.
1.7 "CBSI PLAN" means a tax-qualified Code Section 401(k) defined
contribution plan sponsored by CBSI in which Synova is a contributing employer.
1.8 "CBSI SUPERIOR PROPOSAL" means any proposal which the Board
determines in its good faith judgment, based on consultation with the Financial
Advisor or any other investment banking firm of national reputation and outside
counsel, is more favorable to CBSI's shareholders than the transactions
contemplated by this Agreement, considering all factors, including without
limitation the net after tax proceeds or economic benefit to CBSI which would
result from such proposal.
1.9 "CLOSING" means the consummation of the transactions contemplated
by this Agreement.
1.10 "CLOSING DATE" means September 28, 2000, at 10:00 a.m., or such
other date as may be mutually agreed upon by CBSI and Buyer.
1.11 "COBRA" means Section 4980B of the Code and Section 601, et seq,
of ERISA.
1.12 "CODE" means the Internal Revenue Code of 1986, as amended.
1.13 "CODE SECTION 125 PLAN" means any flexible benefits plan within
the meaning of Code Section 125.
1.14 "ERISA" means the Employee Retirement Income Security Act of 1974,
as amended (29 U.S.C.ss.1001 et seq.).
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1.15 "EXCHANGE COMMON STOCK" means 750,000 shares of the CBSI Common
Stock owned by Buyer on the Closing Date.
1.16 "FINANCIAL ADVISOR" means Legg Mason Wood Walker Incorporated.
1.17 "INDEMNIFIED PARTY" means any person entitled to be indemnified
under Article Nine.
1.18 "INDEMNIFYING PARTY" means any person required to provide
indemnification under Article Nine.
1.19 "INDEMNITY CLAIM" means the following:
(a) any claim of a party resulting from
(i) any breach of the representations and warranties given by
the other party or parties under this Agreement;
(ii) the non-fulfillment of any covenants of the other party
or parties contained in this Agreement or in any agreement or document
to be delivered pursuant to this Agreement; or
(iii) any other material breach by the other party or parties
of the terms of this Agreement or any agreement or document to be
delivered pursuant to this Agreement.
1.20 "KNOWLEDGE" or "to the knowledge" of any person, or words of
similar import, mean the actual knowledge of such person after due inquiry,
where, if such person is a corporation, inquiry was made of senior executive
level employees, officers or directors of such person who would reasonably be
expected to know the matters within the scope of the representation or warranty
in question.
1.21 "LOSSES" means any and all loss, cost, damage (including without
limitation consequential damages) or expense arising or resulting from any
Indemnity Claim, including but not limited to reasonable fees and disbursements
of counsel, accountants and other experts, incident to any and all actions,
suits, demands, assessments and judgments related to any claim made hereunder,
but excluding amounts for which Synova or CBSI has recovered proceeds under any
insurance policy or third party guaranty, indemnity or other obligation.
1.22 "SPECIAL COMMITTEE" means the Special Committee of the Board of
Directors of CBSI, which was appointed for the purpose of evaluating the
acquisition of Synova by Buyer.
1.23 "SYNOVA" means Synova., Inc., a Michigan corporation.
1.24 "SYNOVA COMMON STOCK" means 100 shares of the common stock,
without par value, of Synova, which shares constitute, and will constitute on
the Closing Date, all of the issued and outstanding capital stock of Synova.
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1.25 "SYNOVA COMPETITIVE ACTIVITY" means information technology
programming services provided to customers or clients on an hourly or per diem
basis, which are delivered either onsite at the client facility or offsite at a
North American development facility (but not a development facility located
outside of North America) and which do not include services provided to clients
or customers on a project basis in which Synova contracts to supply
deliverables.
1.26 "THRESHOLD AMOUNT" means $500,000.
1.27 "WELFARE PLAN" means any employee welfare benefit plan as defined
in ERISA Section 3(1).
ARTICLE TWO
EXCHANGE OF SHARES
2.1 EXCHANGE OF SHARES. Subject to the terms and conditions herein
contained, including the conditions set forth in Section 7.1 and 7.2 hereof:
(a) Buyer agrees to assign and transfer to CBSI on the Closing Date
the Exchange Common Stock, free and clear of any lien, encumbrance, equity or
adverse claim; and
(b) CBSI agrees to assign and transfer to Buyer on the Closing Date
the Synova Common Stock, free and clear of any lien, encumbrance, equity or
adverse claim.
It is the intention of the parties that the exchange referenced in this Section
2.1 qualify as a nontaxable transaction pursuant to the provisions of Section
355 of the Code and the regulations promulgated thereunder. The parties will
take all steps as are reasonably necessary or appropriate to satisfy the
requirements of Section 355 of the Code and such regulations, including but not
limited to, preparation and timely submission of the information required by
Treas. Reg.ss.1.355-5.
ARTICLE THREE
THE CLOSING
3.1 TIME AND PLACE OF CLOSING. Unless this Agreement is earlier
terminated as hereinafter provided, the Closing shall be held at the offices of
Butzel Long in Detroit, Michigan, on the Closing Date or at such other place and
at such other time as may be mutually agreed upon by CBSI and Buyer.
3.2 ACTIONS TO BE TAKEN. The following actions shall be taken at the
Closing:
(a) Buyer shall deliver to CBSI certificates representing the
Exchange Common Stock, duly endorsed for transfer, or with appropriate stock
powers attached.
(b) CBSI shall deliver to Buyer certificates representing the Synova
Common Stock, duly endorsed for transfer, or with appropriate stock powers
attached.
3.3 FURTHER ASSURANCES. Buyer agrees that after the Closing Date, upon
the request of CBSI, Buyer will from time to time execute and deliver to CBSI
all such instruments and documents as shall be necessary to vest in CBSI title
to and possession of the Exchange Common
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Stock or to otherwise effectuate the transactions contemplated in this
Agreement. CBSI agrees that after the Closing Date, upon the request of Buyer,
it will from time to time execute and deliver to Buyer all such instruments and
documents as shall be necessary to vest in Buyer title to and possession of the
Synova Common Stock or to otherwise effectuate the transactions contemplated in
this Agreement.
ARTICLE FOUR
REPRESENTATIONS AND WARRANTIES OF CBSI
CBSI warrants to Buyer that the representations and warranties set
forth herein are true and correct as of the date of this Agreement and will be
true and correct on the Closing Date as if made on that date.
4.1 TITLE TO SHARES. CBSI has valid and full legal title to the Synova
Common Stock, free and clear of any lien, encumbrance, equity or adverse claim.
The Synova Common Stock constitutes the only capital stock of Synova issued and
outstanding. CBSI has full right, power and authority to sell, transfer and
deliver the Synova Common Stock to Buyer and upon the occurrence at Closing of
the actions specified in Section 3.2 CBSI will have transferred to Buyer valid
and full legal title to the Synova Common Stock, free and clear of any liens,
encumbrances, equities and adverse claims of any kind or nature.
4.2 ORGANIZATION. CBSI is a corporation duly organized, validly
existing and in good standing under the laws of the State of Michigan and has
the full corporate power and authority to carry on its business as now being
conducted.
4.3 NECESSARY AUTHORIZATION AND APPROVAL. CBSI has full corporate power
and authority to execute and deliver this Agreement and to consummate the
transactions contemplated hereby. All acts and other proceedings required to be
taken by or on the part of CBSI to authorize it to carry out this Agreement and
the transactions contemplated hereby have been duly and properly taken. This
Agreement has been duly executed and delivered by CBSI and constitutes the
legal, valid and binding obligation of CBSI enforceable in accordance with its
terms.
4.4 THIRD PARTY CONSENTS AND APPROVALS. Except as set forth in Schedule
4.4, neither the execution, delivery or performance of this Agreement by CBSI
nor the consummation of the transactions contemplated hereby is prohibited by,
or requires CBSI or Synova to obtain any consent, authorization, approval or
registration under, any law, rule or regulation, or any judgment, order, writ,
injunction, or decree, which is binding upon CBSI or Synova or any property or
asset of Synova, or the terms of any contract to which CBSI or Synova is a party
or to which any property or asset owned by Synova is subject. Except as set
forth in Schedule 4.4, the execution and delivery of this Agreement, and the
consummation of the transactions contemplated hereby, will not violate any
provision of, or result in any acceleration of any obligations under, or the
creation or imposition of any lien pursuant to, any mortgage, lien, lease,
agreement, instrument, order, arbitration award, judgment or decree (including,
without limitation, those set forth in the Schedules hereto) and will not
violate or conflict with any other material restriction of any kind or character
to which Synova or any property or asset of Synova is subject.
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4.5 ORGANIZATION, POWERS AND CAPITALIZATION OF SYNOVA.
(a) Synova is a corporation duly incorporated and organized, validly
existing and in good standing under the laws of the State of Michigan and has
the corporate power to carry on its business, as such business is now being
conducted, and to own, lease or operate the properties and assets it now owns,
leases or operates.
(b) The authorized capital stock of Synova consists of 60,000 shares
of Common Stock, without par value, 100 of which are validly issued and
outstanding on the date hereof and owned by CBSI. All of the Synova Common Stock
is fully paid and nonassessable. There are no existing options, warrants,
contracts, calls, commitments, demands or other agreements of any character to
which Synova or CBSI is a party which could require the purchase or sale of any
shares (whether or not currently outstanding) of the capital stock of Synova.
(c) There is no voting trust, voting agreement, shareholder agreement
or other agreement to which Synova or CBSI is a party relating to the voting or
sale, transfer or other disposition of any of the Synova Common Stock.
4.6 SUBSIDIARIES AND JOINT VENTURES. Synova has no subsidiaries. Synova
has no stock or equity interest in, or any commitment to acquire any such
interest in, any corporation, firm, partnership or organization.
4.7 BOOKS AND RECORDS. To CBSI's knowledge, the books and records of
Synova fairly reflect the assets, liabilities and operations of Synova.
4.8 TAX MATTERS.
(a) To the knowledge of CBSI, there is no plan, intention or
arrangement on the part of any shareholder of CBSI to sell, exchange, transfer
by gift, or otherwise dispose of any stock in CBSI after the Closing.
(b) There is no plan, intention or arrangement by CBSI, directly or
through any Affiliate, to purchase any of its outstanding stock after the
Closing, other than through stock purchases meeting the following requirements:
(i) there is a sufficient business purpose for the stock purchase; (ii) the
stock to be purchased is widely held; (iii) the stock purchases will be made in
the open market; and (iv) there is no plan or intention that the aggregate
amount of such stock purchases will equal or exceed 20% of the outstanding stock
of CBSI.
(c) There is no plan, intention or arrangement to liquidate CBSI,
to merge CBSI with any other entity, or to sell or otherwise dispose of the
assets of CBSI after the transaction, except in the ordinary course of business.
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ARTICLE FIVE
REPRESENTATIONS AND WARRANTIES OF BUYER
Buyer represents and warrants to CBSI that the representations and
warranties set forth herein are true and correct as of the date of this
Agreement and will be true and correct on the Closing Date as if made on that
date.
5.1 TITLE TO COMMON STOCK. Buyer has valid and full legal title to the
Exchange Common Stock, free and clear of any lien, encumbrance, equity or
adverse claim. Buyer has full right, power and authority to sell, transfer and
deliver all of such shares of Exchange Common Stock to CBSI and upon the
occurrence at Closing of the actions specified in Section 3.2 such Buyer will
have transferred to CBSI valid and full legal title to such shares of Exchange
Common Stock free and clear of any liens, encumbrances, equities and adverse
claims of any kind or nature. There is no shareholder agreement or other
agreement to which Buyer is a party relating to the sale, transfer or other
disposition of any of the Exchange Common Stock.
5.2 NECESSARY AUTHORIZATION OR APPROVALS. Buyer has full power,
authority and legal capacity to execute and deliver this Agreement and the other
agreements and instruments to be executed and delivered by Buyer pursuant hereto
and to consummate the transactions contemplated hereby. This Agreement has been
duly executed and delivered by Buyer and constitutes the legal, valid and
binding obligation of Buyer enforceable in accordance with its terms.
5.3 THIRD PARTY CONSENTS AND APPROVALS. Neither the execution, delivery
or performance of this Agreement nor the consummation of the transactions
contemplated hereby is prohibited by, or requires Buyer to obtain any consent,
authorization, approval or registration under, any law, rule or regulation,
other than as contemplated hereby, or any judgment, order, writ, injunction or
decree, which is binding on Buyer or the terms of any contract to which Buyer is
a party.
5.4 PURCHASE FOR INVESTMENT. Buyer has received all information and
documents which Buyer has requested from CBSI regarding Synova and has reviewed
it adequately to make a fully informed investment decision. In making his
investment decision, Buyer has only relied upon such requested information, his
personal knowledge of the business and affairs of Synova, this Agreement, and
any other written information otherwise provided to Buyer by CBSI or Synova. No
oral representations have been relied upon by Buyer. Buyer is an "accredited
investor" as that term is defined in the 1933 Act. Buyer has the financial
ability to accept the risk of investing in the Synova Common Stock, has adequate
means of providing for his needs and contingencies and has no need for liquidity
in his investment in the Synova Common Stock. Buyer's investment in the Synova
Common Stock will not cause his overall commitment to investments which are not
readily marketable to become excessive. Buyer understands that the exchange of
stock under Section 3.2 of this Agreement has not been registered under the 1933
Act, or the applicable provisions of the securities laws of any other
jurisdiction, in reliance upon the exemptions from such registration. Buyer
understands that the Synova Common Stock may not be sold or otherwise
transferred in the future without compliance with the registration requirements
of the 1933 Act and such other securities laws, unless an exemption from such
requirements is available. Buyer realizes that there is no public market for the
Synova Common Stock and that CBSI has no obligation to effect the
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registration of a public sale of the Synova Common Stock under the 1933 Act or
any such other securities laws. Buyer has evaluated the restrictions on sale,
transferability and assignment of the Synova Common Stock, as described in this
Agreement. Buyer understands that he will bear the risk of investment in the
Synova Common Stock for an indefinite period of time. The Synova Common Stock is
being acquired by Buyer solely for investment and for his own account and not
the account of any other person.
5.5 TAX MATTERS.
(a) The Exchange Common Stock has been held by Buyer for more than
five (5) years.
(b) Buyer has no plan, intention or arrangement to sell, exchange,
transfer by gift, or otherwise dispose of any of the Synova Common Stock after
the Closing.
(c) Buyer has no plan, intention or arrangement to cause Synova or
any Affiliate to purchase any outstanding stock of Synova after the Closing.
(d) Buyer has no plan, intention or arrangement to liquidate
Synova, to merge Synova with any other entity, or to sell or otherwise dispose
of the assets of Synova after the Closing, except in the ordinary course of
business.
ARTICLE SIX
AGREEMENTS OF BUYER, CBSI AND SYNOVA
Buyer, CBSI and Synova agree that from the date of this Agreement to
the Closing Date, and thereafter to the extent provided below, each shall take,
and CBSI and Buyer shall cause Synova to take, the following actions:
6.1 CONSENTS; PRESERVATION OF BUSINESS. From the date hereof, CBSI and
Buyer agree to use their respective reasonable efforts to obtain any necessary
consents, authorizations or approvals of any governmental or other third party
to the transactions contemplated hereby. From the date hereof, CBSI and Buyer
agree to use reasonable efforts to preserve the business of Synova intact and to
maintain or cause to be maintained satisfactory relationships with suppliers,
customers and others having business relationships with Synova which are
material to the success of its business.
6.2 REASONABLE EFFORTS. Buyer and CBSI agree to use all reasonable
efforts to facilitate the consummation of the transactions contemplated by this
Agreement so as to permit the Closing to take place on the date indicated.
6.3 COURSE OF CONDUCT. From the date hereof, pending the Closing, CBSI
and Buyer agree that the business of, and all transactions by, Synova will be
conducted or entered into only in the usual and ordinary course and that no
party shall cause or permit Synova to engage in any of the activities listed
below, except as may be first approved by the parties in writing or as is
otherwise permitted or contemplated by this Agreement:
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(a) mortgaging, pledging or subjecting to lien, charge or other
encumbrance any of its assets, or entering into any agreement resulting in the
imposition of any such mortgage, lien or charge;
(b) incurring any indebtedness for money borrowed or any noncurrent
indebtedness for the purchase price of any fixed or capital asset;
(c) making any change in its Articles of Incorporation or By-laws;
(d) voluntarily incurring any material obligation or liability,
absolute or contingent, except (i) in the ordinary course of business, or (ii)
pursuant to existing contracts and agreements described in this Agreement or in
the Schedules delivered pursuant hereto.
6.4 TRADE SECRETS. CBSI, for a period of two (2) years after the
Closing, shall treat as trade secrets all confidential or specialized data or
information with respect to the business or assets of Synova, including, without
limitation, customer lists, service information and pricing information, and
CBSI shall not disclose any such trade secrets to any other person, firm or
corporation, except as authorized in writing by Buyer or Synova after the
Closing.
6.5 INFORMATION. Buyer, CBSI and Synova shall fully and timely comply
with the information reporting requirements of Treas. Reg. ss. 1.355-5. In
addition, Synova shall make available to CBSI such information as shall be
reasonably necessary to permit CBSI to prepare its consolidated tax returns for
the fiscal year ended December 31, 2000. CBSI will treat all such information as
trade secrets in accordance with Section 6.4 (except that CBSI may incorporate
such information into its consolidated tax returns and related schedules to the
extent required by applicable law).
6.6 NON-COMPETITION.
(a) For a period of two (2) years after the Closing Date, CBSI will
not, and will use its best efforts to cause any Affiliate thereof not to,
directly or indirectly (i) engage in any Synova Competitive Activity or (ii)
engage in, manage, operate, be connected with or acquire any interest in, as an
employee, consultant, advisor, agent, owner, partner, co-venturer, principal,
director, shareholder, lender or otherwise, any entity engaged in any Synova
Competitive Activity; provided, however, that CBSI may acquire such an entity if
it discontinues such Synova Competitive Activity within a reasonable time.
(b) For a period of two (2) years after the Closing Date, Buyer will
not, Synova will not, and they will use their best efforts to cause any of their
respective Affiliates not to, directly or indirectly (i) engage in any CBSI
Competitive Activity or (ii) engage in, manage, operate, be connected with or
acquire any interest in, as an employee, consultant, advisor, agent, owner,
partner, co-venturer, principal, director, shareholder, lender or otherwise, any
entity engaged in any CBSI Competitive Activity, except that Buyer or his
Affiliates may own, in the aggregate, less than 5% of the outstanding shares of
any publicly held corporation which is engaged in any CBSI Competitive Activity
which has shares listed for trading on a securities exchange registered with the
Securities and Exchange Commission or through the automatic quotation system of
a registered
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securities association. Notwithstanding the foregoing, Buyer may engage in the
activities and investments listed on Schedule 6.6(b).
(c) For a period of two (2) years after the Closing Date, Buyer
will not, Synova will not, and they will use their best efforts to cause any of
their respective Affiliates not to, directly or indirectly (i) solicit for
employment, employ or otherwise interfere with the relationship of CBSI or any
of its Affiliates with any natural person throughout the world who is or was
employed by or otherwise engaged to perform services for CBSI or any of its
Affiliates during the six month period preceding such solicitation, employment
or interference, or (ii) induce any employee of the Company or any of its
Affiliates who is a member of management to engage in any activity which Buyer
or Synova are prohibited from engaging in under Section 6.6(b) or to terminate
such person's employment with CBSI.
(d) The parties hereto agree that the duration of the
non-competition and non-solicitation provisions set forth in this Section 6.6
are reasonable. In the event that any court determines that the duration or the
geographic scope, or both, are unreasonable and that such provision is to that
extent unenforceable, the parties hereto agree that the provision shall remain
in full force and effect for the greatest time period and in the greatest
geographic area that would not render it unenforceable.
6.7 SPECIFIC ENFORCEMENT. The parties agree that damages are an
inadequate remedy for any breach of the provisions of Section 6.4, Section 6.5,
or Section 6.6 and that each party shall, whether or not it is pursuing any
potential remedies at law, be entitled to equitable relief in the form of
specific enforcement or preliminary and permanent injunctions without bond or
other security upon any actual or threatened breach thereof. The remedies
referred to in this Section shall not be deemed to be exclusive of any other
remedies available to the parties, by judicial proceedings or otherwise, to
enforce the performance or observance of the covenants and agreements contained
in Sections 6.4, 6.5, or 6.6 hereof.
6.8 BENEFIT PLANS.
(a) CBSI PENSION PLANS. Except as otherwise specifically provided in
this Agreement, Synova shall continue its status as a participating
employer in the CBSI Plan until December 31, 2001, or such later date as
agreed to in writing by CBSI, all in accordance with an agreement in the
form attached to this Agreement as Exhibit 6.8(a) to be entered into by
CBSI and Synova. As soon as practicable after the Closing Date, Synova will
execute any and all such plan documents, trust agreements, administrative
service agreements, insurance contracts and other agreements as CBSI deems
necessary to effectuate Synova's status as a participating employer in the
CBSI Plan.
(b) SYNOVA WELFARE PLANS AND CODE SECTION 125 PLANS.
(i) Except as otherwise specifically provided in this Agreement,
Synova shall continue its status as a participating employer in the CBSI
Welfare Plans and Code Section 125 Plans until December 31, 2001, or such
later date as agreed to in writing by CBSI, all in accordance with an
agreement in the form attached to this
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Agreement as Exhibit 6.8, to be entered into by CBSI and Synova. As
soon as practicable after the Closing Date, Synova will execute any and
all such plan documents, administrative service agreements, insurance
contracts and other agreements as CBSI deems necessary to effectuate
Synova's status as a participating employer in the CBSI Welfare Plans
and Code Section 125 Plans.
(ii) All claims arising out of or relating to (A) services or
benefits provided to any Synova employees and their spouses and
dependents (for purposes of this Section 6.8, "Covered Individuals")
after the Closing Date, and (B) all premiums for insurance coverage
applicable to any Covered Individual under the CBSI Welfare Plans or
Code Section 125 Plans on and after the Closing Date, shall be the sole
responsibility of Synova, and CBSI shall have no liability for such
claims. Synova shall remain solely responsible for all claims for
payment of any premiums for the CBSI Welfare Plans and Code Section 125
Plans relating to periods prior to the Closing Date and for any
liability for all claims, expenses and treatments, including
administrative expenses, which are covered and payable under the terms
of the CBSI Welfare Plans and Code Section 125 Plans and incurred or
related to periods prior to the Closing Date, irrespective of whether
any such claim, expense or treatment is filed or submitted after the
Closing Date, and CBSI shall have no liability for any such claims,
expenses or treatments.
(iii) Effective as of the date that Synova is no longer a
participating employer in the CBSI Welfare Plans and Code Section 125
Plans, Synova will provide, under its Welfare Plans and Code Section
125 Plans, which plans may be newly established or modified existing
plans, to each Synova employee, former Synova employee and qualified
beneficiary (as defined in Section 601, et seq, of ERISA and Section
4980B, et seq, of the Code), health care continuation coverage to which
Synova employees, former Synova employees and qualified beneficiaries
are currently entitled or to which they may become entitled on or after
the such date. Such health care continuation coverage shall be
substantially equivalent in the aggregate to the benefit coverages
provided to such individuals under the CBSI Welfare Plans and Code
Section 125 Plans, all in accordance with the terms and conditions of
the Synova Welfare Plans and Code Section 125 Plans.
(c) COOPERATION. In connection with the implementation of this
Section, CBSI and Synova shall cooperate in effecting the provisions of this
Section, including, but not limited to, the exchange of information, the
notification of Covered Employees and providers and the preparation of any
required documentation.
(d) COBRA. CBSI shall be solely responsible for any notices required
to be given on or after the Closing Date pursuant to COBRA with respect to group
health plan coverage under the CBSI Welfare Plans and for any payments or
benefits required pursuant to COBRA or on account of any violation of any
requirement of COBRA by the CBSI Welfare Plans, and Synova shall have no
responsibility for any such notices, payments or benefits.
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6.9 ADDITIONAL COVENANTS OF CBSI. After the date of this Agreement,
CBSI will continue the active conduct of its business, independently and with
its separate employees. For a period of one year after the date of this
Agreement, at the request of Buyer, CBSI will provide to Synova the services
described on Schedule 6.9, at a price equal to the fair market value of such
services, as mutually agreed upon by the parties.
6.10 ADDITIONAL COVENANTS OF BUYER AND SYNOVA. After the date of this
Agreement, Buyer will cause Synova to, and Synova will, continue the active
conduct of its business, independently and with its separate employees. After
the date of this Agreement, neither Buyer nor Synova will take any action that
materially contributes to, or results in, the exchange of stock under Section
3.2 of this Agreement failing to qualify for tax-free treatment to CBSI and its
Affiliates under Section 355 of the Code, including without limitation, by
reason of Section 355(e) of the Code applying to such exchange.
6.11 FURTHER ASSURANCES. The parties agree at any time and from time to
time after the Closing, upon the request of another party, to do, execute,
acknowledge and deliver, or to cause to be done, executed, acknowledged and
delivered, all such further acts, assignments, transfers, powers of attorney and
assurances as may be reasonably necessary or appropriate to carry out the terms,
conditions and purposes of this Agreement.
ARTICLE SEVEN
CONDITIONS OF CLOSING
7.1 CONDITIONS PRECEDENT TO THE OBLIGATIONS OF THE BUYER. The
obligations of Buyer under this Agreement to consummate the transactions
contemplated hereunder are subject to the fulfillment, prior to or at the
Closing, of each of the following conditions, except to the extent that Buyer
may waive any one or more thereof.
(a) The representations and warranties of CBSI shall be true on and
as of the Closing Date with the same effect as if such representations and
warranties had been made on and as of the Closing Date. CBSI shall have
performed and complied with all agreements and conditions required by this
Agreement to be performed or complied with by it prior to or at the Closing.
Since the date of this Agreement, there shall have been no material adverse
change in the business, operations, results of operations or condition
(financial or otherwise) of Synova, other than changes relating to matters
within the control of Buyer as an officer or director of Synova prior to
Closing.
(b) CBSI shall have obtained and delivered, or caused Synova to
obtain and deliver, to Buyer all the consents listed in Schedule 4.4, which
consents shall be in form and substance satisfactory to Buyer, unless the
failure to obtain any such consent would not have a material adverse effect on
the business, properties, results of operations or financial or other condition
of Synova.
(c) On the Closing Date:
(i) there shall be no injunction, restraining order or order of
any nature issued by any court of competent jurisdiction which directs
that this Agreement or any material transaction contemplated hereby
shall not be consummated as herein provided, compels or
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would compel Synova to dispose of or discontinue the business or a
portion of its business as a result of the consummation of any of the
transactions contemplated hereby, or imposes a fine, awards damages or
imposes or awards any other monetary or non-monetary penalty or relief
based on the transactions hereby contemplated; and
(ii) there shall be no suit, action or other proceeding by any
person pending before any court or governmental agency, or threatened
to be filed or initiated, which, in the judgment of the Buyer, may
result in the restraint or prohibition of the consummation of any
transaction contemplated hereby or the obtaining of an amount in
payment of damages from or other relief against any of the parties
hereto or against any director or officer of Synova or any of its
Affiliates, in connection with the consummation of any transaction
contemplated hereby.
(d) CBSI shall have delivered to Buyer the resignation from office of
all officers and directors of Synova.
(e) All actions contemplated by Section 3.2 shall have been taken.
(f) All proceedings, corporate or otherwise, to be taken by CBSI in
connection with the transactions contemplated by this Agreement, and all
documents incident thereto, shall be reasonably satisfactory in form and
substance to Buyer and CBSI shall have made available, or caused Synova to make
available, to counsel for Buyer all records and documents relating to the
business and affairs of Synova, which such counsel may reasonably request in
connection with its review thereof.
(g) CBSI shall have duly adopted a plan of reorganization in accordance
with and in satisfaction of Treas. Reg. ss.1.368-1(c).
(h) Buyer shall have received an opinion of Butzel Long satisfactory in
both form and substance regarding the qualification of the exchange of shares
set forth in Section 2.1 herein as a nontaxable transaction pursuant to the
provisions of Section 355 of the Code and the regulations promulgated
thereunder.
(i) All material contracts being performed by Synova on and as of the
Closing Date, with respect to which Synova is not a party, shall have been
assigned to Synova, with the consent of the other party or parties to any such
contract if required.
7.2 CONDITIONS PRECEDENT TO THE OBLIGATIONS OF CBSI. The obligations of
CBSI under this Agreement to consummate the transactions contemplated hereunder
are subject to the fulfillment, prior to or at the Closing, of each of the
following conditions, except to the extent that CBSI may waive any one or more
thereof.
(a) The representations and warranties of Buyer contained in this
Agreement shall be true on and as of the Closing Date with the same effect as if
such representations and warranties had been made on and as of the Closing Date.
Buyer shall have performed and complied with all agreements and conditions
required by this Agreement to be performed or complied with by Buyer prior to or
at the Closing. CBSI shall have been furnished with certificates of Buyer, dated
the
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<PAGE> 18
Closing Date, certifying in such detail as CBSI may reasonably request, to the
fulfillment of the foregoing conditions.
(b) On the Closing Date:
(i) there shall be no injunction, restraining order or order of any
nature issued by any court of competent jurisdiction which directs that
this Agreement or any material transaction contemplated hereby shall not be
consummated as herein provided, or imposes a fine, awards damages or
imposes or awards any other monetary or non-monetary penalty or relief
based on the transactions hereby contemplated; and
(ii) there shall be no suit, action or other proceeding by any person
pending before any court or governmental agency, or threatened to be filed
or initiated, which, in the judgment of CBSI, may result in the restraint
or prohibition of the consummation of any transaction contemplated hereby
or the obtaining of an amount in payment of damages from or other relief
against any of the parties hereto or against any director or officer of
CBSI or any of its Affiliates, in connection with the consummation of any
transaction contemplated hereby.
(c) All actions contemplated by Section 3.2 shall have been taken.
(d) All proceedings to be taken by Buyer in connection with the
transactions contemplated by this Agreement, and all documents incident thereto,
shall be reasonably satisfactory in form and substance to CBSI and Buyer shall
have made available to counsel for CBSI all records and documents which such
counsel may reasonably request in connection with its review thereof.
(e) Synova shall have duly adopted a plan of reorganization in
accordance with and in satisfaction of Treas. Reg. ss.1.368-1(c).
(f) CBSI shall have received an opinion of Butzel Long satisfactory in
both form and substance regarding the qualification of the exchange of shares
set forth in Section 2.1 herein as a nontaxable transaction pursuant to the
provisions of Section 355 of the Code and the regulations promulgated
thereunder.
(g) CBSI shall have received an opinion from the Financial Advisor
satisfactory in both form and substance regarding the fairness of the exchange
under Section 3.2 to CBSI and its shareholders from a financial point of view.
(h) Synova shall have executed and delivered to CBSI a Promissory Note
in the form attached hereto as Exhibit 7.2(h).
(i) The Rajendra B. Vattikuti Trust UAD October 19, 1990, as amended,
shall have executed and delivered to CBSI the Continuing Guaranty, in the form
attached hereto as Exhibit 7.2(i)(A) and the Continuing Pledge Agreement, in the
form attached hereto as Exhibit 7.2(i)(B), together with the collateral under
such Pledge Agreement and the Assignment Separate from Certificate, in the form
attached hereto as Exhibit 7.2(i)(C).
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ARTICLE EIGHT
SURVIVAL OF REPRESENTATIONS, WARRANTIES AND COVENANTS
8.1 REPRESENTATIONS AND WARRANTIES. The representations and warranties
of Buyer, on the one hand, and CBSI, on the other, shall be deemed to be
material to the other party and to have been relied upon by each of them
notwithstanding any investigation heretofore or hereafter made or omitted by the
either of them and shall continue in full force and effect through the date
twelve (12) months following the Closing Date, at which time they shall
terminate; provided however, that the representations and warranties contained
in Sections 4.8 and 5.5 shall survive until thirty (30) days after the
expiration of the applicable statute of limitations, including any extensions
thereof. Notwithstanding the foregoing, (i) any cause of action based on fraud,
fraudulent misrepresentation or fraudulent breach of warranty may be brought at
any time until the expiration of the relevant statute of limitations, and (ii)
any representation or warranty shall survive the time at which it would
otherwise terminate, with respect to any notice of breach of such representation
or warranty given prior to such time to the party alleged to have committed such
breach.
8.2 SURVIVAL OF COVENANTS. Each covenant or agreement made in this
Agreement which by its terms is to be performed after the Closing shall survive
the Closing until it is performed or until the expiration date set forth with
respect to such covenant. Notwithstanding any provision of this Agreement to the
contrary, the covenants contained in Sections 6.9 and 6.10 shall survive until
the expiration of the applicable statute of limitations, including any
extensions thereof.
ARTICLE NINE
INDEMNIFICATION
9.1 INDEMNIFICATION BY CBSI. CBSI shall indemnify and hold harmless
Buyer against all Losses. Notwithstanding the foregoing:
(a) in no event shall CBSI be liable to any Indemnified Party for any
Losses which, when added to all Indemnity Claims paid by CBSI exceeds
$4,863,281; and
(b) any indemnification by CBSI pursuant to this Section 9.1 shall
not be required unless and until the aggregate amount of all such Losses exceeds
the Threshold Amount; provided, that once such Losses exceed the Threshold
Amount, CBSI shall indemnify the Buyer for all Losses and not merely for Losses
in excess of the Threshold Amount.
9.2 INDEMNIFICATION BY BUYER. Buyer shall indemnify and hold harmless
CBSI and its Affiliates from and against any and all Losses. Notwithstanding the
foregoing:
(a) in no event shall Buyer be liable to CBSI for amounts in excess
of $4,863,281; and
(b) any indemnification by Buyer pursuant to this Section 9.2 shall
not be required unless and until the aggregate amount of all such Losses exceeds
the Threshold Amount; provided, that once such Losses exceed the Threshold
Amount, Buyer shall indemnify CBSI for all Losses and not merely for Losses in
excess of the Threshold Amount.
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9.3 INDEMNIFICATION BY SYNOVA. Synova shall indemnify and hold harmless
CBSI and its Affiliates from and against any and all Losses arising from a
breach by Synova under this Agreement. Notwithstanding the foregoing:
(a) in no event shall Synova be liable to CBSI for amounts in excess
of $4,863,281; and
(b) any indemnification by Synova pursuant to this Section 9.3 shall
not be required unless and until the aggregate amount of all such Losses
exceeds the Threshold Amount; provided, that once such Losses exceed the
Threshold Amount, Synova shall indemnify CBSI for all Losses and not merely
for Losses in excess of the Threshold Amount.
9.4 DELIVERY OF CLAIMS NOTICE. Promptly after an Indemnified Party
becomes aware of any Indemnity Claim, the Indemnified Party shall deliver a
Claims Notice to the Indemnifying Party which is required to provide
indemnification with respect to such Indemnity Claim, in the manner specified in
this Agreement.
9.5 OBLIGATION TO DEFEND.
(a) Upon receipt of a Claims Notice relating to a claim brought by a
third party against an Indemnified Party but excluding any claims brought
against an Indemnified Party for taxes, the Indemnifying Party shall, at
his or its own expense, assume the defense of any such claim or proceeding.
The Indemnified Party shall cooperate with all reasonable requests made by
the Indemnifying Party relating to the compromise of, or defense against,
such claim or proceeding and shall make available to the Indemnifying Party
any books, records, other documents or personnel within its control that
are necessary or appropriate for such defense.
(b) The Indemnifying Party shall conduct such assumed defense or
settlement in a reasonable manner. No compromise or settlement shall be
agreed or made without the Indemnified Party's written consent, which shall
not be unreasonably withheld. In any case, the Indemnified Party shall have
the right to employ his or its own counsel and such counsel may participate
in (but not control) such action, but the fees and expenses of such counsel
shall be at the expense of the Indemnified Party unless the Indemnified
Party has reasonably concluded that there may be a conflict of interest
between the Indemnifying Party and the Indemnified Party in the conduct of
the defense of such action.
(c) If the Indemnifying Party fails to assume the defense or
settlement in a reasonable manner, the Indemnified Party may engage
independent counsel selected by the Indemnified Party to assume the defense
and may contest, pay, settle or compromise any such claim on such terms and
conditions as the Indemnified Party may determine subject to the written
consent of the Indemnifying Party, which shall not be unreasonably
withheld. The reasonable fees and disbursements of such counsel shall
constitute Losses for which indemnification shall be made hereunder.
9.6 TIME PERIOD FOR ASSERTING INDEMNIFICATION. A claim for
indemnification pursuant to this Article must be asserted by delivery of a
Claims Notice within the following periods:
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(a) With respect to claims based on a breach of any Representation or
Warranty contained herein, within the survival period for the specific
representation or warranty as determined pursuant to Article Eight.
(b) With respect to claims based upon the nonfulfillment of any
covenant contained in this Agreement or in any agreement or document to be
delivered pursuant to this Agreement, on or prior to the later of (i) the
date twelve (12) months following the Closing Date or (ii) the expiration
of such longer period, if any, as may be specified with respect to any
covenant.
(c) With respect to any other claims, on or prior to the date twelve
(12) months following the Closing Date.
ARTICLE TEN
TERMINATION OF AGREEMENT PRIOR TO CLOSING DATE
10.1 TERMINATION BY BUYER OR CBSI. This Agreement may be terminated by
either Buyer or CBSI if:
(a) any unrelated third party or government agency shall institute
any proceeding seeking to enjoin or prevent consummation of the transactions
contemplated hereby or seeking any material amount of damages as a result
thereof; or
(b) the Closing shall not have occurred on or before December 31,
2000.
10.2 TERMINATION BY BUYER. This Agreement may be terminated by Buyer
if:
(a) a material default shall be made by CBSI with respect to the due
and timely performance of any of the covenants or agreements contained herein
which is applicable to it, or with respect to the accuracy and completeness of,
or due compliance with, any of the representations and warranties of CBSI
contained herein, and such default shall not have been cured within fifteen (15)
days after delivery of notice specifying particularly such default; provided,
however, that if such default shall have been cured, but such fifteen (15) day
period shall not have expired, on or prior to the Closing Date, the Closing Date
shall be extended accordingly; or
(b) all of the conditions set forth in Section 7.1 of this Agreement
shall not have been satisfied on or before the Closing Date or waived by Buyer
on or before such date.
10.3 TERMINATION BY CBSI. This Agreement may be terminated by CBSI if:
(a) a material default shall be made by Buyer with respect to the due
and timely performance of any of Buyer's covenants and agreements contained
herein, or with respect to the accuracy and completeness of, or due compliance
with, any of the representations and warranties of Buyer contained herein, and
such default shall not have been cured within fifteen (15) days after delivery
of notice specifying particularly such default, provided, however, that if such
default shall have been cured, but such fifteen (15) day period shall not have
expired, on or prior to the Closing Date, the Closing Date shall be extended
accordingly; or
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(b) all of the conditions set forth in Section 7.2 of this Agreement
shall not have been satisfied by the Closing Date, or waived by CBSI on or
before such date; or
(c) prior to the Closing Date, the Board of Directors of CBSI, to the
extent that it determines in good faith, following a recommendation of the
Special Committee and after consultation with outside counsel, that in light of
a CBSI Superior Proposal it is necessary to do so in order to act in a manner
consistent with its fiduciary duties to the CBSI shareholders under applicable
law; provided that such termination is made solely in order to concurrently
enter into a definitive agreement with respect to any CBSI Superior Proposal at
a time that is after the third business day following Buyer's receipt of written
notice advising Buyer that the Board of Directors of CBSI is prepared to accept
a CBSI Superior Proposal, specifying the material terms and conditions of such
CBSI Superior Proposal, all of which information shall be kept confidential by
Buyer.
10.4 EFFECT OF TERMINATION. Upon any termination of this Agreement
pursuant to this Article Ten, neither Buyer nor CBSI shall have any liability
one to the other; provided, that the foregoing shall not relieve any party of
liability for any previous breach of its obligations hereunder. Notwithstanding
the foregoing provisions of this Article Ten, no party hereto shall be entitled
to exercise any right to terminate and abandon this Agreement if such party has
willfully and intentionally defaulted under any provision of this Agreement or
willfully and intentionally taken any action which resulted in the
nonfulfillment of any condition to Closing hereunder unless such default shall
have been cured and shall not be continuing at the time of the exercise of such
right.
ARTICLE ELEVEN
GENERAL
11.1 AMENDMENT OR WAIVER. Any party to this Agreement may waive or
modify in writing any term or provision hereof existing for such party's benefit
at any time. No such waiver, and no amendment of this Agreement, shall be
effective unless contained in an instrument in writing signed by the party
against whom such waiver or amendment is sought to be enforced.
11.2 GOVERNING LAW. This Agreement shall be governed by and construed
in accordance with the law of the State of Michigan without regard to choice of
law principles which would require the application of the law of any other
jurisdiction.
11.3 BROKERS. CBSI represents and warrants that neither it nor Synova
nor anyone acting on behalf of CBSI or Synova, has made any commitment or done
any other act which might result in the imposition of any liability on Buyer or
Synova for any brokerage, finder's or similar fee or commission in connection
with the transactions contemplated by this Agreement. Buyer represents and
warrants that neither Buyer nor anyone acting on Buyer's behalf has made any
commitment or done any other act which might result in the imposition of any
liability on CBSI for any brokerage, finder's or similar fee or commission in
connection with the transactions contemplated by this Agreement.
11.4 NOTICES. Any and all notices and other communications hereunder
shall be in writing addressed to the parties at the addresses specified below or
such other addresses as either
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party may direct by notice given in accordance with this Section, and shall be
delivered in one of the following manners: (i) by personal delivery, in which
case notice shall be deemed to have been duly given when delivered; (ii) by
certified mail, return receipt requested, with postage prepaid, in which case
notice shall be deemed to have been duly given on the date indicated on the
return receipt; (iii) by reputable delivery service (including by way of example
and not limitation Federal Express, UPS and DHL) which makes a record of the
date and time of delivery, in which case notice shall be deemed to have been
duly given on the date indicated on the delivery service's record of delivery;
or (iv) by fax transmission to the fax numbers given below, with confirmation of
good receipt and confirmed by letter to the addresses set forth below, in which
case notice shall be deemed to have been duly given on the date indicated in the
confirmation of fax transmission (or the next business day if transmission
occurs on a non-business day or after 5:00 p.m. (EST/EDT) on any business day):
if to CBSI, to:
Complete Business Solutions, Inc.
32605 West Twelve Mile Road
Suite 250
Farmington Hills, MI 48334
Attn.: General Counsel
Fax: 248-848-9741
with a copy to:
Arthur Dudley II, Esq.
Butzel Long
150 W. Jefferson, Suite 900
Detroit, MI 48226
Fax: 313-225-7080
if to Buyer, to:
Rajendra B. Vattikuti
32605 West Twelve Mile Road, Suite 250
Farmington Hills, Michigan 48334
Fax: 248-488-0439
with a copy to:
Brian P. Henry
Freeman, Cotton & Norris
33 Bloomfield Hills Parkway, Suite 100
Bloomfield Hills, Michigan 48304
Fax: 248-642-2255
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If to Synova, to:
Synova, Inc.
50 West Big Beaver Road, Suite 460
Troy, Michigan 48084
Attention: President
Fax: 248-526-0601
11.5 ARTICLE, SECTION AND PARAGRAPH HEADINGS. The article, section and
paragraph headings contained in this Agreement are for reference purposes only
and shall not affect in any way the meaning or interpretation of this Agreement.
11.6 COUNTERPARTS. This Agreement may be executed in counterparts, each
of which shall be deemed an original, but all of which together shall constitute
one and the same instrument.
11.7 SUCCESSORS AND ASSIGNS. The respective rights and obligations of
the parties hereto shall not be assigned without the prior written consent of
the other parties. This Agreement shall be binding upon and inure to the benefit
of the heirs, distributees, successors and assigns of the parties hereto.
Nothing herein contained is intended to confer upon any person, other than the
parties hereto and their respective permitted successors, assigns and nominees,
any rights, remedies, obligations or liabilities under or by reason of this
Agreement.
11.8 ENTIRE AGREEMENT. This Agreement, including the Schedules referred
to herein, constitutes the entire agreement between the parties hereto and
supersedes all prior agreements, representations, warranties, statements,
promises, information, arrangements and understandings, whether oral or written,
express or implied, with respect to the subject matter hereof. None of the
parties hereto shall be bound by or charged with any oral or written agreements,
representations, warranties, statements, promises, information, arrangements or
understandings not specifically set forth in this Agreement and the Schedules,
or in the agreements, schedules, documents and instruments to be delivered on or
before the Closing Date pursuant to this Agreement. The parties hereto further
acknowledge and agree that, in entering into this Agreement and in delivering
the schedules, documents and instruments to be delivered on or before the
Closing Date they have not in any way relied, and will not in any way rely, upon
any oral or written agreements, representations, warranties, statements,
promises, information, arrangements or understandings, express or implied, not
specifically set forth in this Agreement or in such schedules, documents or
instruments.
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IN WITNESS WHEREOF, the parties hereto have duly executed this
Agreement as of the day and year first above written.
COMPLETE BUSINESS SOLUTIONS, INC.,
A MICHIGAN CORPORATION
By: /s/ Timothy S. Manney
---------------------------------------------
Its: Executive Vice President
-------------------------------------------
THE RAJENDRA B. VATTIKUTI TRUST UAD
DATED OCTOBER 19, 1990, AS AMENDED
/s/ Rajendra B. Vattikuti
------------------------------------------------
RAJENDRA B. VATTIKUTI, TRUSTEE
/s/ Rajendra B. Vattikuti
------------------------------------------------
RAJENDRA B. VATTIKUTI, INDIVIDUALLY
Synova, Inc. is executing and delivering this Agreement solely for the purpose
of being legally bound by the provisions of Articles Six, Eight, Nine and
Eleven.
SYNOVA, INC.
BY /S/ RAJENDRA B. VATTIKUTI
----------------------------------------------
RAJENDRA B. VATTIKUTI, PRESIDENT AND CEO
