UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
CURRENT REPORT PURSUANT TO SECTION 13 OR 15(d)
OF THE SECURITIES EXCHANGE ACT OF 1934
Date of Report (Date of Earliest Event Reported): March 2, 1998
INTERGRAPH CORPORATION
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(Exact Name of Registrant as Specified in its Charter)
0-9722
--------------------------
(Commission File Number)
Delaware 63-0573222
- ----------------------------- -------------------------------------
(State or Other Jurisdiction (I.R.S. Employer Identification No.)
of Incorporation)
Intergraph Corporation
Huntsville, Alabama 35894-0001
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(Address of Principal Executive Offices) (Zip Code)
(205) 730-2000
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(Telephone Number)
INTERGRAPH CORPORATION
FORM 8-K
March 17, 1998
Item 2: Acquisition or Disposition of Assets.
-------------------------------------
On March 2, 1998, the Company closed its transaction with
Unigraphics Solutions, Inc. (USI), a subsidiary of
Electronic Data Systems Corporation, in which the Company
sold certain of the assets of its Solid Edge and
Engineering Modeling System product lines for $105 million
in cash. The Company anticipates a gain on this
transaction of approximately $100 million. Additionally,
the Company estimates the sale of this business will
result in a reduction of its 1998 revenues by
approximately $30 million, if not replaced, and an
improvement in its operating results of approximately $5
million, excluding the impact of the estimated $100
million gain on the sale.
"Solid Edge" and "Engineering Modeling System" (EMS)
software are application specific software products
developed, marketed, and sold by Intergraph Corporation to
end user customers for use in automation of the design of
mechanical parts and assemblies. The products are sold by
Intergraph through its direct sales force, its
international subsidiary companies, and through indirect
channels including distributors, business partners, and
resellers.
Under the Agreement, USI purchased from Intergraph certain
of the assets of the Solid Edge and EMS product lines,
including:
1) Intellectual property interests, including the
outright purchase of the Solid Edge and EMS source
code, trademarks, and copyrights unique to those
products, and license agreements with Intergraph for
source code, patents and patent applications, and
software development tools common to the acquired
products and other products not sold to USI.
2) Contract rights, including customer contracts
(except for certain contracts between Intergraph and
the United States government and contracts for the sale
and maintenance of software used in the design and
manufacturing of structural support systems for ships
and other marine vessels), distributor, business
partner, and reseller contracts, and unfulfilled bids
and sales orders with customers.
3) Inventories and supplies.
4) Computer hardware, office equipment, and furniture.
5) Prepaid expenses and other assets.
In addition, USI extended offers of employment to
Intergraph employees directly associated with the Solid
Edge and EMS product lines.
Assets specifically retained by Intergraph and thus not
included in the agreement of sale include, in addition to
those described in 1) and 2) above, accounts receivable
attributable to sales of the product lines up to the March
2, 1998 closing date, contracts related to real property
associated with the product lines, and certain contracts
for third party software utilized in the product lines.
Liabilities of the product lines assumed by USI are
limited to those arising subsequent to the date of closing
under the assumed contracts described above. All
liabilities arising from the operations of the product
lines prior to the closing date, or relating to any of the
assets retained, were retained by Intergraph.
Item 7: Exhibits.
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Number Description
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99(a) ASSET PURCHASE AGREEMENT BY AND
AMONG INTERGRAPH CORPORATION AND THE OTHER
SELLING ENTITIES SPECIFIED HEREIN AND
UNIGRAPHICS SOLUTIONS INC. AND THE OTHER
ACQUIRING ENTITIES SPECIFIED HEREIN, AND
EXHIBITS
99(b) NON SOLICITATION OF EMPLOYEES AGREEMENT
99(c) STATEMENTS OF REVENUE AND DIRECT
EXPENSES SOLID EDGE/EMS PRODUCT LINE
99(d) LETTER OF CONSENT OF FOOTHILL
CAPITAL CORPORATION
99(e) PARTIAL RELEASE OF COPYRIGHTS
99(f) PARTIAL RELEASE OF TRADEMARKS
Forward-looking statements
Any statement contained in this current report which is not a
historical fact, or which might otherwise be considered an opinion
or projection concerning Intergraph Corporation , whether express
or implied, is meant as and should be considered a forward looking
statement as that term is defined in the Private Securities
Litigation Reform Act of 1996. Forward looking statements are
based on assumptions and opinions concerning a variety of known
and unknown risks, including but not necessarily limited to
fluctuations in customer demand, acceptance of new products,
changes in technology, product introductions by competitors, and
general economic conditions, as well as other risks more
completely described in the Company's filings with the Securities
and Exchange Commission, including its most recent Annual Report
on Form 10-K and its Forms 10-Q for the quarters ended March 31,
June 30, and September 30, 1997. If any of these assumptions or
opinions prove incorrect, any forward looking statements made on
the basis of such assumptions or opinions may also prove
materially incorrect in one or more respects.
INTERGRAPH CORPORATION
SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of
1934, the registrant has duly caused this report to be signed
on its behalf by the undersigned thereunto duly authorized.
INTERGRAPH CORPORATION
----------------------
(Registrant)
By: /s/ John W. Wilhoite
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John W. Wilhoite
Vice President and Controller
Date: March 17, 1998
ASSET PURCHASE AGREEMENT
BY
AND
AMONG
INTERGRAPH CORPORATION
AND THE OTHER SELLING ENTITIES SPECIFIED HEREIN
AND
UNIGRAPHICS SOLUTIONS INC.
AND THE OTHER ACQUIRING ENTITIES SPECIFIED HEREIN
ASSET PURCHASE AGREEMENT
TABLE OF CONTENTS
Page
ARTICLE I
DEFINITIONS
1.1 Certain Definitions 1
1.2 Other 14
ARTICLE II
THE PRINCIPAL CLOSING; INTERNATIONAL CLOSINGS
2.1 Time and Place of Principal Closing 14
2.2 Time and Place of International Closings 15
2.3 Acquisition of the Acquired Assets 15
2.4 Closing Deliveries by Acquiring Entities 17
2.5 Closing Deliveries by the Selling Entities 19
2.6 Other Deliveries 21
2.7 Responsibility for the Retained Liabilities 21
2.8 Allocation of the Consideration for the Acquired Assets 21
2.9 Waiver of Bulk Sales Compliance 22
2.10 Waivers of Deliveries or Conditions Precedent 22
2.11 Customer Contracts 22
2.12 Distributor Contracts 23
2.13 Consents 23
2.14 Interim Operation for International Selling Entities 24
ARTICE III
REPRESENTATIONS AND WARRANTIES OF THE SELLING ENTITIES
3.1 Corporate Existence and Authority 25
3.2 Authorization and Effect of Agreement, Etc. 25
3.3 No Violation 26
3.4 Consents 26
3.5 General Warranty 27
3.6 Challenges To This Agreement 27
3.7 Financial Statements 27
3.8 Accounts Receivable 27
3.9 Customer Discounts 28
3.10 SEC Reports 28
3.11 Absence of Changes 28
3.12 Books and Records 28
3.13 Taxes 28
3.14 Disputes and Litigation 30
3.15 Environmental Matters 30
3.16 Bank Accounts 30
3.17 Year 2000 Compliance 30
3.18 Rights Used; Certain Relationships 30
3.19 Title to Properties and Absence of Liens 30
3.20 Real Property 31
3.21 Contracts 31
3.22 Contract Status 32
3.23 Certain Contracts 33
3.24 Employees 33
3.25 Employee Benefit Matters 35
3.26 Compliance with Export Laws 36
3.27 Inventories 36
3.28 Master Purchase Agreements 36
3.29 Compliance with Law 37
3.30 Projections 37
3.31 Intellectual Property 37
3.32 Software 40
3.33 Development and Protection of the Owned IP 41
3.34 Accuracy of Consent Schedules 42
3.35 Confidential Information 42
3.36 Brokers 42
3.37 Commercial Software 42
ARTICLE IV
REPRESENTATIONS AND WARRANTIES OF THE ACQUIRING ENTITIES
4.1 Corporate Existence and Authority 43
4.2 Authorization and Effect of Agreement, Etc. 43
4.3 No Violation 43
4.4 Challenges To This Agreement 44
4.5 Consents 44
4.6 Brokers 44
ARTICLE V
COVENANTS OF THE SELLING ENTITIES
5.1 Consummation of Transactions 44
5.2 Conduct of Business 44
5.3 Preservation of Business 45
5.4 Access to Information 46
5.5 Notification of Certain Matters 47
5.6 Furnishing of Information 47
5.7 Non-Solicitation 48
5.8 Use of Owned Software 48
5.9 Expenses of Transaction 48
5.10 Further Assurances 48
5.11 Period of Exclusivity 48
5.12 Noncompetition 49
5.13 Certain Employee Benefit Matters 49
5.14 Intergraph Guaranty 52
5.15 Enforcement of Confidentiality Agreement 52
5.16 Confidential Information 52
5.17 Assistance and Cooperation 53
5.18 Product Serial Numbers 53
ARTICLE VI
COVENANTS OF THE ACQUIRING ENTITIES
6.1 Consummation of Transactions 53
6.2 Notification of Certain Matters 54
6.3 Employment 54
6.4 Assistance with Specified Contracts and Litigation Contracts 54
6.5 Trade Names and Service Marks 55
6.6 EDS and USI Guaranty 55
6.7 Assistance and Cooperation 55
ARTICLE VII
CONDITIONS PRECEDENT
TO THE OBLIGATIONS OF THE ACQUIRING ENTITIES
7.1 Representations and Warranties 55
7.2 Performance by the Selling Entities 56
7.3 Prohibitions, Restrictions and Litigation 56
7.4 Consents 56
7.5 Governmental Clearances 56
7.6 Satisfactory Proceedings 56
7.7 Certificate of Intergraph and Certain Officers 56
7.8 Waiver of Conditions 56
7.9 New Collateral Contracts 57
7.10 Absence of Material Adverse Change 57
ARTICLE VIII
CONDITIONS PRECEDENT
TO THE OBLIGATIONS OF THE SELLING ENTITIES
8.1 Representations and Warranties 57
8.2 Performance by the Acquiring Entities 57
8.3 Prohibitions, Restrictions and Litigation 57
8.4 Consents 57
8.5 Governmental Clearances 58
8.6 Certificate of USI and Certain Officers 58
8.7 Waiver of Conditions 58
8.8 New Collateral Contracts 58
ARTICLE IX
INDEMNIFICATION; OFFSET
9.1 Indemnification by the Acquiring Entities 58
9.2 Indemnification by the Selling Entities 59
9.3 Satisfaction of Claims 61
9.4 Matters Which May Give Rise to Claims 62
ARTICLE X
GENERAL
10.1 Survival of Representations and Agreements 63
10.2 Termination 64
10.3 HSR Filings; Other Filings 64
10.4 Expenses of Transaction 65
10.5 Public Disclosure 65
10.6 Notices 65
10.7 Assignment 66
10.8 Amendments; Waivers, Etc. 66
10.9 Governing Law 66
10.10 Consent to Jurisdiction 66
10.11 Arbitration 67
10.12 Specific Performance 68
10.13 Tax Matters 68
10.14 Number and Gender 71
10.15 Section Headings, Schedules, Etc. 71
10.16 Complete Agreement; Counterparts 71
10.17 Severability 71
10.18 No Third Party Beneficiaries 71
10.19 Inconsistencies 71
ASSET PURCHASE AGREEMENT
THIS ASSET PURCHASE AGREEMENT (this "Agreement") is made and
entered into as of March 2, 1998, by and among INTERGRAPH
CORPORATION, a Delaware corporation ("Intergraph"), and the other
Selling Entities (as defined below), and UNIGRAPHICS SOLUTIONS
INC., a Delaware corporation ("USI"), and the other Acquiring
Entities (as defined below).
W I T N E S S E T H:
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WHEREAS, the Selling Entities desire to sell and transfer to
the Acquiring Entities, and the Acquiring Entities desire to
purchase and acquire from the Selling Entities, the Acquired
Assets (as defined below), all on the terms and conditions set
forth in this Agreement;
WHEREAS, as more fully described in this Agreement, in
addition to the transfer of certain of the Acquired Assets to
occur at the Principal Closing (as defined below) concurrently
with the execution of this Agreement, at one or more concurrent
or subsequent International Closings (as defined below) provided
for herein, certain Selling Entities and certain Acquiring
Entities will execute and deliver Closing Agreements (as defined
below), pursuant to which each applicable Selling Entity will
sell and transfer certain of the Acquired Assets to each
applicable Acquiring Entity at such International Closing or
Closings, all upon the terms and conditions set forth in this
Agreement and in each applicable Closing Agreement;
NOW, THEREFORE, in consideration of the premises, the
respective covenants, representations and warranties set forth
below, and other good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, and intending to be
legally bound hereby, the parties hereto warrant, represent,
covenant and agree as follows:
ARTICLE I
DEFINITIONS
1.1 Certain Definitions. In addition to other terms
defined in this Agreement, the following terms, as used herein,
shall have the respective meanings set forth below:
"Accounts Receivable" as of any specified date shall mean
the accounts, notes and other receivables (including without
limitation any "accounts" as defined under the Uniform Commercial
Code) of any Selling Entity relating to the Business as of such
date, including any indebtedness arising from the sale or license
of products or merchandise or the provision of services by any
such Selling Entity relating to the Business and the right to
payment of any interest or finance charges or similar fees or
charges relating thereto.
"Acquired Assets" shall mean all of the business, assets,
properties and goodwill of every kind and description (real,
personal, mixed, tangible and intangible) of the Selling Entities
constituting the Business as a going concern, wherever located,
and whether or not reflected in the Books and Records of
Intergraph, to which, or in which, any of the Selling Entities
have any right, title or interest as of the Principal Closing
Date or the applicable International Closing Date, as the case
may be, by reason of ownership, use or otherwise; including,
without limitation, (i) the assets reflected on the Balance
Sheet, (ii) the Transferred Intellectual Property Interests and,
solely with respect to the Transferred Intellectual Property
Interests assigned to the Acquiring Entities pursuant to the
General Bill of Sale, the Copyright Assignment, the Trademark
Assignment, a Closing Agreement or any document equivalent to the
Copyright Assignment or Trademark Assignment entered into in
connection with an International Closing, any and all claims for
damages and other relief by reason of any past infringement or
misappropriation thereof, (iii) all Contract rights related to
the Business, including, without limitation, maintenance,
distributor, value added reseller or business partner agreements
and the rights of any Selling Entity under the Purchase and Sale
Agreement between Intergraph (Deutschland) GmbH, Norsk Data GmbH
and Norsk Data A.S. dated April 30, 1992 related to the
acquisition of the Technovision Software and all rights under the
agreement related to the acquisition of the ProRen Software, (iv)
customer and supplier lists, (v) sales and promotional
literature, (vi) machinery, equipment, computer hardware,
workstations, furniture and replacement parts which are used in
the Business, (vii) production manuals, correspondence and
research; (viii) personnel, financial and other Books and
Records, (ix) inventories, supplies, work in progress and
supplies, prepaid expenses and similar items; (x) Accounts
Receivable attributable to products or services furnished on or
following the Principal Closing Date and (xi) trade association
memberships that are used exclusively or primarily in connection
with the Business; provided, however, that the Acquired Assets
shall not include the Retained Assets.
"Acquiring Entities" shall mean those Persons listed as
Acquiring Entities on the signature pages hereof and "Acquiring
Entity" shall mean any of such Persons.
"Affiliate" shall mean any Person that directly or
indirectly through one or more intermediaries controls, is
controlled by or is under common control with the Person
specified (for purposes of this definition, a Person will be
deemed to have control of a corporation or other entity if it
holds, directly or indirectly, a greater than 50% voting interest
in that corporation or other entity).
"Agreed Courts" shall have the meaning ascribed thereto in
Section 10.10.
"Arbitration Panel" shall have the meaning ascribed thereto
in Section 10.11(a)(iii).
"Assumed Contracts" shall mean (i) those Contracts of any of
the Selling Entities relating to the Business and listed in
Section 2 of Schedule 3.23(a), Schedule 3.31(b) or Schedule
3.32(b) (excluding those Contracts specifically identified on
Schedules 3.31(b) or 3.32(b) as not being included within the
Acquired Assets), (ii) any Successor Distributor Contract entered
into pursuant to Section 2.12 hereof, and (iii) outstanding bids
and accepted customer orders of the Selling Entities, in each
case made in the ordinary course of business, as of the relevant
Closing Date for new business with respect to the Business made
in the ordinary course of business under the standard terms and
conditions of the Selling Entities; provided, however, that
notwithstanding any provision in this Agreement or in any
instrument of assignment or transfer, certificate or other
document executed and delivered pursuant to this Agreement to the
contrary, if any of such Contracts referenced above is a
Specified Contract or a Litigation Contract, then (i) such
Specified Contract or Litigation Contract, as the case may be,
shall be deemed not to be an Assumed Contract for any reason
whatsoever under or by reason of this Agreement or any such
instrument of assignment or transfer, certificate or other
document, and (ii) no Acquiring Entity shall be deemed to have
assumed any debt, liability or obligation whatsoever under such
Specified Contract or Litigation Contract.
"Assumed Liabilities" shall mean all executory obligations
of the respective Selling Entities under the Assumed Contracts
arising from and after the applicable Closing Date; provided,
however, that the Assumed Liabilities shall not include any of
the Retained Liabilities.
"BAG Products License Agreement" shall have the meaning
ascribed thereto in Section 2.4.
"BAG Tools" shall have the meaning set forth in the BAG
Products License Agreement.
"Balance Sheet" shall have the meaning ascribed thereto in
the definition of Financial Statements.
"Balance Sheet Date" shall mean December 31, 1997.
"Bill of Sale Transaction" shall mean the transaction at the
Principal Closing with respect to which USI and Intergraph will
execute and deliver the General Bill of Sale and the Transferred
Intellectual Property License Agreements pursuant to which the
Acquired Assets held by Intergraph are transferred and conveyed
by Intergraph to USI.
"Books and Records" shall mean all accounting, financial
reporting, Tax, business, marketing, corporate and other files,
documents, instruments, papers, books and records of a specified
Person, including without limitation financial statements,
budgets, projections, ledgers, journals, titles, manuals,
Contracts, agency lists, customer lists, supplier lists, reports,
computer files, retrieval programs and operating data or plans.
"Business" shall mean the three-dimensional mechanical
CAD/CAM/CAE business conducted by Intergraph and its direct and
indirect subsidiaries (and/or a branch of Intergraph or any such
subsidiary) through the SolidEdge and EMS product lines and which
include, without, limitation, the software and related
maintenance businesses for the SolidEdge, EMS, Technovision and
ProRen products.
"Business Day" shall mean a day on which federally chartered
banks located in Dallas, Texas are required or authorized to open
for business (other than a Saturday or Sunday) under the
Legislative Enactments of the United States.
"Bylaws" shall mean the bylaws or, as appropriate, other
generally recognized body of comparable written statements (other
than a Charter or its equivalent) establishing the internal
organization of a Person and/or its primary relationships with
its management and with its shareholders or other owners.
"CAD II Agreements" shall mean the following Contracts
between Intergraph and the Government of the United States of
America: (i) Contract Number N66032-91-D-0003, dated April 8,
1991; (ii) Contract Number N66032-93-D-0021, dated August 30,
1993; and (iii) Contract Number N66032-94-D-0012, dated July 13,
1994.
"CAD II Trademark Agreement" shall have the meaning ascribed
thereto in Section 2.4.
"Charter" shall mean the Articles of Incorporation,
Certificate of Incorporation, Memorandum and Articles of
Association and/or other charter of any Person.
"Claim" shall have the meaning ascribed thereto in
Section 9.3.
"Closing" shall mean those events which occur on the
Principal Closing Date (or, with respect to International
Closings, on the respective International Closing Dates) for the
purpose of consummating the transactions contemplated by this
Agreement in accordance with Article II.
"Closing Agreement" shall have the meaning ascribed thereto
in Section 2.3(a).
"Closing Date" shall mean the date on which occurs the
Principal Closing or an International Closing, as the case may
be.
"COBRA" shall mean the Congressional Omnibus Budget
Reconciliation Act of 1985, together with any amendments and
supplements thereto, providing for health care continuation
coverage under Section 4980B of the Code or Section 601 et seq.
of ERISA.
"Code" shall mean the United States Internal Revenue Code of
1986, as amended, including without limitation any successor
revenue code of the United States federal government, together
with the rules and regulations promulgated thereunder.
"Competitive Activity" shall have the meaning ascribed
thereto in Section 5.12(b).
"Compliance Group" shall mean the Selling Entities and any
predecessors to each of the Selling Entities.
"Compliance Property" shall mean any real or personal
property, including, without limitation the Real Property,
presently or previously owned, leased or used by any Person in
the Compliance Group.
"Confidentiality Contracts" shall have the meaning ascribed
thereto in Section 3.33(b).
"Confidential Software" shall have the meaning ascribed
thereto in Section 3.33(b).
"Consideration" shall have the meaning ascribed thereto in
Section 2.3.
"Consents" shall mean consents, waivers, permits,
clearances, approvals and other authorizations.
"Contract" shall mean any binding contract, agreement,
understanding, lease, sublease, license, sublicense, distribution
agreement, promissory note, evidence of indebtedness, indenture,
instrument, mortgage, insurance policy, annuity or other binding
commitment, whether written or oral.
"Copyright Assignment" shall have the meaning ascribed
thereto in Section 2.5.
"Copyrights" shall mean all copyright interests comprising a
part of the Business, including, without limitation, all moral
rights, all common-law rights, and all rights to register and
obtain renewals and extensions of copyright registrations,
together with all other copyright interests accruing by reason of
international copyright convention, and the right to sue for
past, present, or future infringement and to collect and retain
all damages and profits therefor.
"Customer Contracts" shall have the meaning ascribed thereto
in Section 3.23(a).
"Distributor Contracts" shall have the meaning ascribed
thereto in Section 3.23(b).
"EDS" shall mean Electronic Data Systems Corporation, a
Delaware corporation and the parent corporation of USI.
"Employee Matter" shall mean personnel policies or practices
and any employee program, plan, arrangement or understanding,
whether written or oral, including all matters relating to a
Contract of employment, in each case with respect to periods on
or prior to the Principal Closing Date.
"Employee Pension Benefit Plans" shall have the meaning
ascribed thereto in Section 3.25(b)(i).
"Employee Welfare Benefit Plans" shall have the meaning
ascribed thereto in Section 3.25(a)(i).
"EMS Code" shall have the meaning set forth in the EMS
License Agreement.
"EMS License Agreement" shall have the meaning ascribed
thereto in Section 2.4.
"Environmental Laws" shall mean (a) all Legislative
Enactments and Official Actions relating to industrial hygiene,
environmental protection, air emissions, water discharges, or the
use, analysis, manufacture, transportation, generation, handling,
treatment, storage or disposal of any Hazardous or Toxic
Substances or the cleanup or remediation of any contamination,
together with all rules and regulations promulgated with respect
to any of the foregoing; and (b) all Legislative Enactments and
Official Actions with respect to property transfer limitations
with respect to Hazardous or Toxic Substances, whether or not
conditioned upon disclosure or upon permit or approval.
"Environmental Liabilities" shall mean any obligation or
liability arising under an applicable Environmental Law.
"ERISA" shall mean the Employee Retirement Income Security
Act of 1974.
"Escrow Agreement" shall have the meaning ascribed thereto
in Section 2.3(c).
"Financial Statements" shall mean the consolidated balance
sheets for the Business at December 31, 1996 and 1997 (the
"Balance Sheet") and the consolidated statements of revenues and
direct expenses for the Business for the years ended December 31,
1995, 1996 and 1997, together with an audit "comfort letter" of
Ernst & Young dated the Principal Closing Date with respect to
the consolidated statements of revenues and direct expenses;
provided that the audit report of Ernst & Young as independent
auditors, on the Financial Statements (which report may be with
respect to the statement of assets purchased referred to in
Section 5.6 hereof in lieu of the Balance Sheet) shall be
delivered as soon as practicable following the Principal Closing
Date pursuant to such Section 5.6 rather than at the Principal
Closing.
"GAAP" shall mean generally accepted accounting principles
and practices which are recognized as such by the American
Institute of Certified Public Accountants acting through its
Accounting Principles Board or other appropriate board or
committee (other than the Emerging Standards Committee), and
which are consistently applied for all periods so as to fairly
reflect the financial condition, the results of operations and
the cash flows of the relevant Person or Persons.
"General Bill of Sale" shall have the meaning ascribed
thereto in Section 2.3.
"Hazardous or Toxic Substances" shall mean: all elements,
compounds, substances, matrices or mixtures ("Materials or
Substances") that are hazardous, toxic, ignitable, reactive or
corrosive including without limitation the following: (i) all
Materials or Substances (whether or not wastes, contaminants or
pollutants) that are or become regulated by any of the
Environmental Laws; (ii) all Materials or Substances which are or
become defined or described by any of the Environmental Laws as
"hazardous" or "toxic" or a "hazardous waste," "extremely
hazardous waste," "acutely hazardous waste" or "acute hazardous
waste"; (iii) all Materials or Substances which, after release
into the environment and exposure thereto (including contact,
ingestion, inhalation, uptake or assimilation), in any organism
(directly or indirectly, immediately or after any period of any
duration) does or will cause or significantly contribute to (or
may be anticipated to cause or to significantly contribute to)
death, disease, disability, psychological deformations or
dysfunctions, psychological or behavioral abnormalities,
cancerous or pre-cancerous conditions, neurological disorders or
dysfunctions, or genetic mutation or damage; (iv) all Materials
or Substances listed in the U.S. Department of Transportation
Hazardous Materials Table (49 CFR 172.101); (v) all Materials or
Substances listed as a "hazardous substance" by the Environmental
Protection Agency in 40 CFR 302.4; (vi) petroleum and petroleum
products and derivatives; (vii) phenols, polychlorinated phenols
(including polychlorinated biphenols (PCBs)), asbestos or radon;
(viii) all Materials or Substances that are regulated under the
Atomic Energy Act of 1954, 42 USC 2011 et seq., or otherwise by
the Nuclear Regulatory Commission; and (ix) all Materials or
Substances (whether raw or processed, active or spent) that
include any of the foregoing as constituents.
"HSR Act" shall mean the Hart-Scott-Rodino Antitrust
Improvements Act of 1976.
"Indemnified Party" shall have the meaning ascribed thereto
in Section 9.3.
"Indemnifying Party" shall have the meaning ascribed thereto
in Section 9.3.
"India Support Agreement" shall have the meaning ascribed
thereto in Section 2.4.
"INGR Tools" shall have the meaning set forth in the INGR
Tools License Agreement.
"INGR Tools License Agreement" shall have the meaning
ascribed thereto in Section 2.4.
"Intellectual Property" shall mean and include (a) Patents,
(b) Trademarks, (c) Copyrights and registrations of claim to
Copyright, including moral rights (if any), (d) Inventions, (e)
Software, (f) Trade Secrets and (g) Know-How.
"Intergraph Fields" shall mean the following specific
fields: (a) three-dimensional products, without significant
capability for use as a three-dimensional mechanical system,
intended primarily for data capture, design, analysis and
management of infrastructure systems, such as Intergraph's
highway design, utility distribution and mapping systems; and (b)
three-dimensional products, without significant capability for
use as a three-dimensional mechanical system, for modeling,
designing (including design of component parts), analyzing,
drawing production, or operation of any of the following systems
which are utilized in chemical and process industry plants,
ships, marine vessels, or offshore platforms, including without
limitation (i) piping, (ii) heating, ventilation and air
conditioning (HVAC), (iii) cable routing, (iv) structural support
systems for marine vessels, ships and offshore platforms, and (v)
process and/or instrument diagrams.
"Intergraph Indemnitees" shall have the meaning ascribed
thereto in Section 9.1.
"Intergraph Losses" shall have the meaning ascribed thereto
in Section 9.1.
"International Closing Date" shall mean any date other than
the Principal Closing Date upon which an International Closing
occurs.
"International Closings" shall mean the Closings with
respect to such portion of the Business conducted outside the
United States as to which all conditions to such Closing have
been satisfied.
"International Selling Entity" shall mean any Selling Entity
organized under the laws of a jurisdiction outside of the United
States.
"Inventions" shall mean and include novel devices,
processes, compositions of matter, methods, techniques,
observations, discoveries, apparatuses, designs, expressions,
theories and ideas, whether or not patentable.
"IP" shall have the meaning ascribed thereto in
Section 3.31(b).
"IRS" shall mean the United States Internal Revenue Service.
"Joint Fields" shall mean the following specific fields:
(a) two-dimensional drafting systems (including those which may
have application to the mechanical drafting market); (b) two-
dimensional modeling systems (including those which may have
application to the mechanical drafting market); (c) creation,
publication or distribution of technical manuals; and (d)
electrical CAD, CAM or CAE systems (or combinations thereof)
without significant capability for use as a three-dimensional
mechanical system.
"Know-How" shall mean scientific, engineering, mechanical,
electrical, marketing or practical knowledge or experience used
in the operation of any of the Business.
"Lease" shall have the meaning ascribed thereto in Section
3.20(a).
"Lease Agreement" shall have the meaning ascribed thereto in
Section 2.4.
"Legal Expenses" of a Person shall mean any and all
reasonable out-of-pocket fees, costs and expenses of any kind
(including attorneys' and experts' fees) incurred by a Person and
its counsel in investigating, preparing for, prosecuting,
defending against or providing evidence, producing documents or
taking other action with respect to any threatened or asserted
Claim.
"Legislative Enactments" shall mean domestic, foreign and
international laws (including without limitation common law),
treaties, ordinances, regulations and rules at any international,
national, federal, state, local or regional level, both as
presently existing and as may become effective in the future.
"License Transactions" shall mean the transactions at the
Principal Closing pursuant to which USI and Intergraph will
execute and deliver the SolidEdge Common Code License Agreement,
the BAG Products License Agreement, the INGR Tools License
Agreement, the Trademark License Agreement and the Patent License
Agreement pursuant to which certain of the Transferred
Intellectual Property Interests are licensed to USI, subject to
the terms set forth in such agreements.
"Lien" shall mean any lien, mortgage, security interest, tax
lien, financing statement, pledge, assessment, lease, sublease,
adverse claim, levy, charge, hypothecation or other encumbrance
of any kind or nature whatsoever including without limitation any
conditional sale Contract, title retention Contract or other
Contract to give any of the foregoing.
"Litigation Contract" shall mean any Contract relating to
the Business pursuant to which a suit, action, litigation or
proceeding exists as of the applicable Closing Date between the
applicable Selling Entity and one or more of the other Persons
that are party thereto in or before any Tribunal.
"Loss Amount" shall have the meaning ascribed thereto in
Section 2.14.
"Losses" shall have the meaning ascribed thereto in Section
9.1.
"LTS Tools" shall mean the Third Party Software described on
Schedule 3.31(b)F.2. hereof.
"Master Purchase Agreements" shall have the meaning ascribed
thereto in Section 3.28.
"Materials or Substances" shall have the meaning ascribed
thereto in the definition of Hazardous or Toxic Substances.
"Miscellaneous Software Components" shall have the meaning
ascribed thereto in the definition of "Software."
"Non-Compete Covenant" shall mean any provision, covenant or
obligation binding on any Selling Entity that limits or restricts
in any manner whatsoever (whether during any particular period of
time from and after the applicable Closing Date, in certain
geographic areas or otherwise) the ability of any of the
Acquiring Entities, any of their Affiliates or any of the
employees, acting in his or her capacity as an employee of an
Acquiring Entity or an Affiliate of the same, of any of the
Acquiring Entities or their Affiliates (a) to engage in any line
of business or to sell any products or services, or (b) to
compete with or to obtain products or services from any Person,
in each case during any period of time after the applicable
Closing Date.
"Not-Owned IP" shall have the meaning ascribed thereto in
Section 3.31(b).
"Not-Owned Software" shall have the meaning ascribed thereto
in Section 3.32(b).
"Official Action" shall mean any domestic or foreign
decision, order, writ, injunction, decree, judgment, award or any
determination, both as presently existing or as may become
effective in the future, by any Tribunal.
"Owned IP" shall have the meaning ascribed thereto in
Section 3.31(a).
"Owned Software" shall have the meaning ascribed thereto in
Section 3.32(a).
"Ownership Interests" shall mean the ownership interests in
any Person, whether classified as debt, equity, profit-sharing or
some other type of ownership interest, including without
limitation capital stock, bonds, notes or other securities.
"Patent License Agreement" shall have the meaning ascribed
thereto in Section 2.4.
"Patents" shall mean all domestic and foreign patents
(including, without limitation, certificates of invention,
utility models, and other patent equivalents), provisional
applications, patent applications and patents issuing therefrom,
as well as any division, continuation, continuation in part,
reissue, extension, reexamination certification, revival or
renewal of any patent, all inventions and subject matter related
to such patents, in any and all forms, and all patents and
applications for patents related to such patents, including the
right to sue for past, present, or future infringement and to
collect and retain all damages and profits therefor.
"PBGC" shall mean the Pension Benefit Guaranty Corporation,
an agency of the United States government.
"Permits and Orders" shall have the meaning ascribed thereto
in Section 3.15(e).
"Permitted Encumbrance" shall have the meaning ascribed
thereto in Section 3.19.
"Person" shall mean any natural person, corporation, limited
liability company, general partnership, limited partnership,
joint venture, proprietorship, trust, association, unincorporated
association, Tribunal or other entity of any kind.
"Powers of Attorney" shall mean the separate powers of
attorney executed and delivered by each of the Selling Entities
substantially in the form of Exhibit A hereto and each of the
Acquiring Entities substantially in the form of Exhibit B hereto,
in each case effective as of the Principal Closing Date.
"Prepaid Maintenance Contracts" shall have the meaning set
forth in Section 3.23(a).
"Prime Rate" shall mean a fluctuating rate of interest equal
to the prime rate or reference rate of interest announced or
published from time to time, at the rate in effect immediately
before the first business day in each month at Citibank, N.A. in
New York, New York; provided, however, that in no event shall
such interest rate exceed the maximum rate of interest allowed by
applicable law.
"Principal Closing" shall mean the Closing of the Bill of
Sale Transaction and any International Closing occurring
concurrently therewith.
"Principal Closing Date" shall have the meaning ascribed
thereto in Section 2.1.
"Proceedings" shall have the meaning ascribed thereto in
Section 10.10.
"Profit Amount" shall have the meaning ascribed thereto in
Section 2.14.
"Projections " shall have the meaning ascribed thereto in
Section 3.30.
"Real Property" shall mean that real property (together with
the fixtures and improvements thereon) owned or leased (as
lessor, sublessor, lessee or sublessee) by any of the Selling
Entities and used in the current conduct of the Business, as more
fully described in Section 1 of Schedule 3.20(a).
"Request" shall have the meaning ascribed thereto in
Section 9.3.
"Retained Assets" shall mean (a) the Charter, Bylaws,
corporate seal, minute books, stock certificates and stock record
books, and stock transfer ledgers of the Selling Entities; (b)
the Customer Contracts; provided, however, that the retention of
such Contracts shall not diminish the rights of the Acquiring
Entities under Section 2.11 hereof; (c) the Distributor
Contracts; other than those Distributor Contracts which will have
been amended prior to the Principal Closing to relate exclusively
to the Business as contemplated by Section 2.12 hereof; (d) the
Master Purchase Agreements and any general corporate or
administrative assets or services furnished by Intergraph for the
benefit of all of its business units, subsidiaries or divisions
and not principally to the Business, including, without
limitation, accounting and legal support and the services
provided under the Transition Services Agreement; (e) employee
benefit agreements, plans or arrangements maintained by any of
the Selling Entities, except with respect to those transfers
contemplated by Section 5.13 hereof; (f) all Accounts Receivable
of the Business, except to the extent any such Accounts
Receivable are attributable to products or services furnished on
or following the Principal Closing Date; (g) the Selling Entities
Tax Returns and such other tax returns and reports, general
ledgers and any other books, records, files or correspondence not
directly and exclusively pertaining to the Business; (h)
personnel Books and Records not relating to the Transitioned
Employees; (i) except as otherwise expressly provided in Section
6.5, the name and mark "Intergraph Corporation"; (j) solely with
respect to the Transferred Intellectual Property Interests which
are not assigned to an Acquiring Entity pursuant to the General
Bill of Sale, the Copyright Assignment, the Trademark Assignment,
a Closing Agreement or any document equivalent to the Copyright
Assignment or Trademark Assignment entered into in connection
with an International Closing, any and all claims for damages and
other relief by reason of any past infringement or
misappropriation thereof; (k) the Intellectual Property subject
to the Transferred Intellectual Property License Agreements, in
each case subject to the licenses granted to the Acquiring
Entities or their assignees thereunder and the restrictions on
use contained therein; (l) all Contract rights relating to the
CAD II Agreements; (m) all rights of Intergraph under its
Contracts with Spatial Technology relating to its use of the ACIS
Software, subject to the rights granted to USI under the Version
4 Reseller Agreement; (n) all Contracts related to real property
of the Selling Entities, and all real property other than the
interest in real property transferred under the Lease Agreement;
(o) building security systems and telephone systems, subject to
the rights of the Acquiring Entities under the Lease Agreement
and the Transition Services Agreement; (p) customer Contracts for
the sale and maintenance of Software used principally in the
design and manufacturing of structural support systems for ships
and other marine vessels; (p) the assets used by the employees
providing services under the India Support Agreement (provided
that such assets will be deemed Acquired Assets in the event USI
shall exercise its option during or following the term of the
India Support Agreement to offer to employ such persons); and (r)
Contract rights relating to (i) that certain agreement dated
April 1992 between Steve Richards (d/b/a Marcomp) and Intergraph,
(ii) that certain Non-Exclusive License Agreement for Dimensional
Constraint Manager between D-Cubed Limited and Intergraph
executed by D-Cubed Limited on July 1, 1994, and (iii) that
certain Agreement Licensing Digital Typefaces dated September 26,
1985 between Bitstream, Inc. and Intergraph, as amended.
"Retained Liabilities" shall mean any liability or
obligation of the Selling Entities which is not specifically
included in the Assumed Liabilities, including without
limitation: (a) any liability or obligation of any Person under
any Customer Contract or Distributor Contract (other than any
Successor Distributor Contracts); (b) any liability or obligation
of any Person under any lease or sublease of Real Property (other
than the obligations of USI under the Lease Agreement); (c) any
pending suit, action, litigation or proceeding affecting or
against any Selling Entity with respect to the Business or any of
the Acquired Assets in or before any Tribunal (including, without
limitation, any liability or obligation relating to the matters
disclosed on Schedule 3.14); (d) any liability or obligation of
the Business evidenced by checks written against the account of
the applicable Selling Entity; (e) any liability or obligation of
the Selling Entities or Affiliates thereof with respect to the
operation of the Business prior to the Principal Closing Date
(other than the obligations under the Assumed Contracts to be
performed in accordance with the terms thereof following the
applicable Closing Date); (f) any liability or obligation
(including any liability or obligation for Taxes) in connection
with or relating to any of the Retained Assets; (g) any liability
or obligation existing as of the applicable Closing Date of the
Selling Entities for vacation, sick leave, holidays and similar
benefits for Transitioned Employees; (h) any liability or
obligation in connection with or relating to any Employee Matter
(including any liability or obligation for Taxes, contributions
or premiums); (i) any liability or obligation of the Selling
Entities under this Agreement or any certificate or other
document or instrument entered into in connection with this
Agreement or the consummation of the transactions contemplated
hereby (including, without limitation, the Closing Agreement);
(j) any liability or obligation of a Selling Entity to Intergraph
or any of its Affiliates; (k) any Environmental Liability (except
those for which USI shall be specifically responsible under the
terms of the Lease Agreement as a result of actions taken by USI
following the Principal Closing Date); (l) any liability or
obligation of the Selling Entities or Affiliates for Taxes; (m)
any liability or obligation of the Selling Entities or Affiliates
for Taxes of any Person under Treas. Reg. Sec. 1.1502-6 (or any
similar provision of state, local or foreign law), as a
transferee or successor, by contract, or otherwise; and (n)
except as otherwise provided in Section 10.13 hereof with respect
to Transaction Taxes, any Taxes attributable to the transfers and
other actions or events required to consummate the transactions
contemplated hereby (including federal state, local, and foreign
income, franchise, gross receipts and net worth taxes).
"Selling Entities" shall mean those Persons listed as
Selling Entities on the signature pages hereof, and "Selling
Entity" shall mean any of such Persons.
"SolidEdge Common Code" shall have the meaning set forth in
the SolidEdge Common Code License Agreement.
"SolidEdge Common Code License Agreement" shall have the
meaning ascribed thereto in Section 2.4.
"SolidEdge License Agreement" shall have the meaning
ascribed thereto in Section 2.4.
"SolidEdge Reseller Agreement" shall have the meaning
ascribed thereto in Section 2.4.
"SolidEdge Specific Code" shall have the meaning set forth
in the SolidEdge License Agreement.
"Software" shall mean the expression of an organized set of
instructions in a natural or coded language which is contained on
a physical media of any nature (e.g., written, electronic,
magnetic, optical or otherwise) and which may be used with a
computer or other automated data processing equipment device of
any nature which is based on digital technology, to make such
computer or other device operate in a particular manner and for a
certain purpose, as well as any related documentation for such
set of instructions. The term shall include computer programs in
source and object code, test or other significant data libraries,
documentation for computer programs, and any of the following
("Miscellaneous Software Components") which is contained on a
physical media of any nature and which is used in the design,
development, modification, enhancement, testing, installation,
maintenance, diagnosis or assurance of the performance of a
computer program: narrative descriptions, notes, specifications,
designs, flowcharts, parameter descriptions, logic flow diagrams,
masks, input and output formats, file layouts, database formats,
test programs, test or other data, user guides, manuals,
installation and operating instructions, diagnostic and
maintenance instructions, source code, object code and other
similar materials and information; provided, however, that such
term shall not include Patents.
"Specified Contract" shall mean any Contract that contains
any Non-Compete Covenant.
"Subcontract Period" shall have the meaning ascribed thereto
in Section 2.11(b).
"Successor Customer Contract" shall have the meaning
ascribed thereto in Section 2.11(a).
"Successor Distributor Contract" shall have the meaning
ascribed thereto in Section 2.12.
"Taxes" shall mean all taxes, charges, fees, levies or other
similar assessments or liabilities, including, without
limitation, any federal, state, local or foreign income,
receipts, ad valorem, value added, purchases, premium, excise,
real property, personal property, windfall profit, sales, stamp,
use, consumption, licensing, withholding, employment, payroll,
share, capital, surplus, franchise, occupational, net proceeds,
estimated, alternative or add-on minimum, production, severance,
lease, excise, duty, net worth, transfer, fuel, excess profits,
interest equalization or other taxes of any kind whatsoever, and
any recording, registration or notary fees, together with any
interest, fines, penalties, assessments or additions to tax
resulting from, attributable to or incurred in connection with,
any such tax or any contest or dispute thereof; "Tax" means any
of the foregoing.
"Tax Return" shall mean any report, return, information
returns, estimates or other information, including any schedule
or attachment thereto, required to be supplied to, or filed with,
the IRS or any other Tax Tribunal (as defined in Section 3.13),
and any amendment thereto, with respect to Taxes.
"Third Party Matter" shall have the meaning ascribed thereto
in Section 9.4(a).
"Trade Secrets" shall mean any formula, design, device or
compilation of information which comprises a part of the
Business, which gives the holder thereof an advantage or
opportunity for advantage over competitors which do not have or
use the same, and which is not generally known by the public.
Trade Secrets can include, by way of example, Software
(including, without limitation, source code for the Owned
Software), information contained on drawings and other documents,
and information relating to the research, development, testing,
marketing plans, business strategy, finances or employees of a
business.
"Trademark Assignment" shall have the meaning ascribed
thereto in Section 2.5.
"Trademark License Agreement" shall have the meaning
ascribed thereto in Section 2.4.
"Trademarks" shall mean all domestic and foreign trademarks,
trade dress, service marks, trade names, icons, logos, slogans,
and any other indicia of source or sponsorship of goods and
services, designs and logotypes related to the above, in any and
all forms, and all trademark registrations and applications for
registration related to such trademarks (including, but not
limited to intent to use applications), including the right to
sue for past, present, or future infringement and to collect and
retain all damages and profits therefor, which comprise a part of
the Business, and all designs and logotypes related to such
trademarks, in any and all forms, and all trademark registrations
and applications for registration related to such trademarks,
including those registrations and applications listed on Schedule
3.31 attached hereto.
"Transaction Taxes" shall mean any federal, state, foreign
or local transfer, sales, use, value added tax (VAT),
registration tax, consumption tax, documentary stamp, conveyance
or any other similar Taxes, together with any interest, fines,
penalties, assessments, or additions to tax resulting from,
attributable to or incurred in connection with any such
Transaction Taxes or any contest or dispute thereof, and any
recording, registration or notary fees, and any fees for
appraisals ordered by an Acquiring Entity, in each case arising
solely out of the sale, conveyance, transfer and/or delivery of
the Acquired Assets to the appropriate Acquiring Entity and the
assumption of the Assumed Liabilities by the appropriate
Acquiring Entity. Transaction Taxes shall not include any
income, receipts, payroll, surplus, franchise, net proceeds,
estimated, alternative or add on minimum, net worth or similar
taxes of the Selling Entities.
"Transferred Intellectual Property Interests" shall mean:
(i) all Intellectual Property transferred, assigned
and conveyed to a Selling Entity pursuant to (A) the General
Bill of Sale, (B) the Copyright Assignment, (C) the
Trademark Assignment, (D) a Closing Agreement, and (E) any
document equivalent to the Copyright Assignment or Trademark
Assignment entered into in connection with an International
Closing, and in each case any and all claims for damages and
other relief by reason of any past infringement or
misappropriation thereof;
(ii) the rights to Intellectual Property transferred
pursuant to the Transferred Intellectual Property License
Agreements;
(iii) the Intellectual Property listed on Schedule
1.1,
(iv) All Know-How, Trade Secrets, Copyrights and
Software comprising a part of the Business, other than that
comprising or used to produce the Solid Edge Common Code,
the INGR Tools and the BAG Tools;
(v) any invention comprising a part of the Business
that was conceived or reduced to practice prior to the
Effective Date other than inventions comprising or used to
produce the Solid Edge Common Code, the INGR Tools or the
BAG Tools;
(vi) applications for Trademark registration and
unregistered Trademarks;
(vii) the Intellectual Property and rights thereto
identified on Schedules 3.31(b) and 3.32(b), except for such
Intellectual Property specifically identified on such
schedules as not constituting Acquired Assets or Transferred
Intellectual Property Interests; and
(viii) all Intellectual Property comprising a part of
the Technovision and ProRen businesses of the Selling
Entities.
"Transferred Intellectual Property License Agreements" shall
mean, collectively, the SolidEdge Common Code License Agreement,
the BAG Products License Agreement, the INGR Tools License
Agreement, the Patent License Agreement and the Trademark License
Agreement.
"Transition Services Agreement" shall have the meaning
ascribed thereto in Section 2.4.
"Transitioned Employee" means any person who was employed by
any Selling Entity immediately prior to the applicable Closing
Date and is hired by any Acquiring Entity as of such Closing
Date, including any person so hired as an employee by any
Acquiring Entity for any period of time and thereafter
terminated.
"Tribunal" shall mean any government, any arbitration panel,
any court or any governmental department, commission, board,
bureau, agency or instrumentality of the United States or any
foreign or domestic state, province, commonwealth, nation,
territory, possession, country, parish, town, township, village
or municipality.
"Undertaking and Assumption Agreements" shall have the
meaning ascribed thereto in Section 2.3(a).
"USI" shall mean Unigraphics Solutions Inc., a Delaware
corporation.
"USI Indemnitees" shall have the meaning ascribed thereto in
Section 9.2.
"USI Losses" shall have the meaning ascribed thereto in
Section 9.2.
"Validated Licenses" shall have the meaning ascribed thereto
in Section 3.35.
"VAT" shall have the meaning ascribed thereto in Section
10.13.
"Version 4 Reseller Agreement" shall have the meaning
ascribed thereto in Section 2.4.
"WARN Act" shall mean the Federal Workers Adjustment and
Retraining Act, P.L. 100-379, 102 Stat. 890.
"Year 2000 Compliant" with respect to any item shall mean
that such item: (i) from now until January 1, 2000, must
correctly operate, store, process and produce data containing
dates before January 1, 2000; (ii) from now until 1 January 2000,
must correctly operate, store, process and produce data
containing dates after December 31, 1999; (iii) from January 1,
2000, must correctly operate, store, process and produce data
containing dates before January 1, 2000; (iv) from January 1,
2000, must correctly operate, store, process and produce data
containing dates after December 31, 1999; (v) must be able to
handle the date January 1, 2001 correctly; (vi) must recognize
the year 2000 as a leap year (February 2000 is recognized as a
valid date, Julian date 00060 is recognized as February 29, 2000,
Julian date 00366 is recognized as December 31, 2000, arithmetic
operations performed recognize that the year 2000 has 366 days
and binary date 36584 is recognized as February 29, 2000); and
(vii) must be able to correctly process data containing the date
September 9, 1999. For purposes of this definition, "correctly"
shall mean accurately and without delay, corruption, interruption
or error relating to the time at which or the date on which such
items are operating.
1.2 Other. All references in this document to this
"Agreement" include all documents, schedules and exhibits
(including without limitation the Closing Agreements) referred to
herein. The transactions contemplated by this Agreement and all
references in this Agreement to "the transactions contemplated
hereby" and similar phrases shall be deemed to include without
limitation all transactions contemplated by the Closing
Agreements. All terms defined in this Agreement shall have such
meanings ascribed thereto when used in any certificate, schedule,
exhibit, report or other document made or delivered pursuant to
this Agreement, unless the context shall otherwise clearly
require.
ARTICLE II
PRINCIPAL CLOSING; INTERNATIONAL CLOSINGS
2.1 Time and Place of Principal Closing. The Principal
Closing will take place on March 2, 1998, at 10:00 a.m., Dallas,
Texas time, at the offices of EDS, 5400 Legacy Drive, Plano,
Texas 75024 (the "Principal Closing Date"). The Principal
Closing shall be effective as of 12:01 a.m. on the Principal
Closing Date.
2.2 Time and Place of International Closings. Each
International Closing will take place on the Principal Closing
Date or an International Closing Date at such time and place as
may be specified in the applicable Closing Agreement, and each
International Closing shall be effective as of 12:01 a.m. on the
Principal Closing Date or an International Closing Date, as the
case may be, unless otherwise specified in the applicable Closing
Agreement. Each International Closing not occurring on the
Principal Closing Date shall take place on the later of (a) March
31, 1998 or (b) the date which is five Business Days after the
last to occur of the dates on which all conditions set forth in
Articles VII and Article VIII with respect to such International
Closing are satisfied or waived by the applicable party, or such
earlier date as USI and Intergraph may agree upon in writing.
2.3 Acquisition of the Acquired Assets.
(a) Unless otherwise indicated in the applicable Closing
Agreement, the Acquired Assets shall be acquired, and the Assumed
Liabilities shall be assumed, generally on a country-by-country
basis, by the one or more Acquiring Entities specified below in
Section 2.3(b) below from the corresponding Selling Entity
specified in Section 2.3(b) below, as of such Closing Date.
Physical delivery of the Acquired Assets to the Acquiring
Entities generally will be made at the current location of each
Acquired Asset or as otherwise provided in the General Bill of
Sale or any Closing Agreement. In connection with the
consummation of the Bill of Sale Transaction, Intergraph and USI
shall execute and deliver a General Bill of Sale and Assignment,
substantially in the form of Exhibit C (the "General Bill of
Sale"), and an Undertaking and Assumption Agreement,
substantially in the form of Exhibit D (the "Undertaking and
Assumption Agreement"), with respect to the transfer and
conveyance of the applicable Acquired Assets pursuant thereto and
the assumption of any related Assumed Liabilities. In connection
with the transfer and conveyance of any Acquired Assets at the
Principal Closing or any International Closing other than
pursuant to the Bill of Sale Transaction, each applicable Selling
Entity and each applicable Acquiring Entity shall execute and
deliver a closing agreement or such other agreements as are
appropriate in any applicable foreign jurisdiction to consummate
the transactions contemplated thereby (together with all
instruments of transfer, conveyance and assignment and other
documents attached thereto or referred to therein, the "Closing
Agreement"), substantially in the form attached hereto as Exhibit
E, as such form shall be revised to the extent required to
reflect applicable law. At any Closing, on the terms and subject
to the conditions set forth in this Agreement and any applicable
Closing Agreement, and on the basis of the representations and
warranties, covenants and agreements set forth in this Agreement
and any applicable Closing Agreement, each Selling Entity
participating in such Closing shall assign, transfer and sell, or
cause to be assigned, transferred and sold, to the applicable
Acquiring Entity participating in such Closing, and each such
Acquiring Entity shall acquire from the applicable Selling
Entity, the applicable Acquired Assets in exchange for (i) the
applicable Consideration set forth in Section 2.3(b) below and
(ii) the assumption by such Acquiring Entity of the obligation to
pay, perform, satisfy and discharge the applicable Assumed
Liabilities. At each Closing the applicable Acquiring Entity
shall deliver to the applicable Selling Entity a wire or
intrabank transfer of immediately available funds in the amount
of the applicable Consideration set forth in Section 2.3(b)
below. With respect to any payments made to a designated
Intergraph bank account on behalf of a Selling Entity, such
Selling Entity agrees that Intergraph shall receive such payment
as agent and on behalf and for the direct benefit of such Selling
Entity. In each such case, Intergraph shall provide USI written
instructions at least two Business Days prior to the Closing Date
as to the routing of the wire or intrabank transfer and the
designated Intergraph bank account to which payment shall be
made.
(b) The consideration shall be One Hundred and Five Million
United States Dollars ($105,000,000.00), subject to the
withholding and payments into escrow pursuant to the terms of the
Escrow Agreement, payable as follows (the "Consideration"):
Selling Entity Acquiring Entity U.S.Dollars
- -------------- ---------------- -----------
Intergraph USI $103,669,000
Intergraph GmbH (Osterreich) Unigraphics Solutions 5,000
Handelsgesellschaft m.b.H
Intergraph Benelux BV Unigraphics Solutions N.V. 11,000
Intergraph Canada Ltd. Unigraphics Solutions Canada 14,000
Ltd.
Intergraph CR s.r.o. Unigraphics Solutions s.r.o. * 8,000
Intergraph CAD/CAM (Danmark) Unigraphics Solutions Danmark 10,000
A/S A/S
Intergraph Finland Oy UG Solutions AB (branch to be 5,000
formed in Finland) **
Intergraph France SA Unigraphics Solutions France 46,000
SAS
Intergraph (Deutschland) GmbH Unigraphics Solutions GmbH 636,000
Intergraph (Italia) L.L.C. Unigraphics Solutions S.p.A. 145,000
Intergraph Japan K.K. Unigraphics Solutions Japan Ltd. 220,000
Intergraph Korea Ltd. Unigraphics Solutions (Korea) 23,000
Ltd. *
Intergraph de Mexico, S.A. Unigraphics Solutions de Mexico, 18,000
de C.V. S.A. de C.V.
Intergraph Benelux B.V. and Unigraphics Solutions B.V. 20,000
Intergraph European
Manufacturing L.L.C.
Intergraph Norge AS Unigraphics Solutions Norge AS 11,000
Intergraph Europe (Polska) Unigraphics Solutions Sp.z.o.o. * 6,000
Sp.z.o.o
Intergraph Systems Pte. Ltd. Unigraphics Solutions Pte. Limited 4,000
Intergraph (Portugal) Unigraphics Solutions Espana, S.A. 7,000
Sistemas de Computacao (branch to be formed in Portugal) **
Grafica S.A.
Intergraph Espana, S.A. Unigraphics Solutions Espana, S.A. 29,000
Intergraph (Sverige) AB UG Solutions AB 46,000
Intergraph (UK) Ltd. Unigraphics Solutions Ltd. 67,000
------------
$105,000,000
______
* As of the date of this Agreement the incorporation process
for these entities has not been completed. Therefore, such
entities have not executed this Agreement but will, pursuant
to the Closing Agreement to be entered into by such entity at
the applicable Closing, agree to be bound by the terms of this
Agreement as an Acquiring Entity in accordance with the terms
hereof.
** As of the date of this Agreement the formation of these
branches has not been completed. However, the Acquiring
Entities which are forming these branches have executed this
Agreement as Acquiring Entities.
(c) At the Principal Closing, the Selling Entities and the
Acquiring Entities shall enter into the Escrow Agreement (the
"Escrow Agreement") substantially in the form attached hereto as
Exhibit F.
2.4 Closing Deliveries by Acquiring Entities. USI shall
deliver to Intergraph the following:
(a) At the applicable Closing, the Consideration specified
in Section 2.3 (subject to the withholding and payments into
escrow pursuant to the terms of the Escrow Agreement) to be
paid with respect to the Assets Acquired at that Closing,
portions of which will be paid by each Acquiring Entity to
each Selling Entity as provided in Section 2.3 above;
(b) At the Principal Closing, a copy of the resolutions of
the Boards of Directors of each of USI and EDS authorizing
the execution, delivery and performance by USI of this
Agreement and by EDS and USI of the other agreements
contemplated hereby to which such Person is a party, and the
consummation of the transactions contemplated hereby and
thereby, certified as of the Closing Date by the Secretary
or Assistant Secretary (or other appropriate officer) of USI
and EDS, respectively;
(c) At the Principal Closing, duly executed certificates of
the Secretary or Assistant Secretary of each of EDS and USI,
certifying as of the Closing Date as to the incumbency and
signature of the officers of such corporations who have
executed this Agreement and the documents delivered at such
Closing on behalf of such corporation;
(d) At the Principal Closing, the Undertaking and
Assumption Agreement, duly executed by USI;
(e) At the Principal Closing, the SolidEdge Reseller
Agreement in the form attached hereto as Exhibit G pursuant
to which Intergraph will become a reseller of the SolidEdge
product of the Business to purchasers under the CAD II
Agreements (the "SolidEdge Reseller Agreement"), duly
executed by USI;
(f) At the Principal Closing, the SolidEdge License
Agreement in the form attached hereto as Exhibit H-1
pursuant to which USI will license certain Intellectual
Property related to the current SolidEdge product of the
Business to Intergraph for distribution pursuant to the CAD
II Agreements (the "SolidEdge License Agreement"), the EMS
License Agreement in the form attached hereto as Exhibit H-2
pursuant to which USI will license certain Intellectual
Property related to the current EMS product of the Business
to Intergraph for distribution pursuant to the CAD II
Agreements (the "EMS License Agreement"), and the Trademark
License for CAD II and Ship Building Contracts in the form
attached hereto as Exhibit H-3 pursuant to which USI would
license certain Trademarks for the uses described therein in
connection with Intergraph's performance of the CAD II
Agreements (the "CAD II Trademark Agreement"), each duly
executed by USI;
(g) At the Principal Closing, the SolidEdge Common
Code License Agreement in the form attached hereto as
Exhibit I pursuant to which Intergraph will grant a
perpetual, royalty-free license to USI and its Affiliates to
use the Intellectual Property described therein (the
"SolidEdge Common Code License Agreement"), duly executed by
USI;
(h) At the Principal Closing, the BAG Products License
Agreement in the form attached hereto as Exhibit J pursuant
to which Intergraph will grant a perpetual, royalty-free
license to USI and its Affiliates for certain Software
described therein (the "BAG Products License Agreement"),
duly executed by USI;
(i) At the Principal Closing, the INGR Tools License
Agreement in the form attached hereto as Exhibit K pursuant
to which Intergraph will grant a perpetual, royalty-free
license to USI and its Affiliates for certain Software
described therein (the "INGR Tools License Agreement"), duly
executed by USI;
(j) At the Principal Closing, the Lease Agreement in
the form attached hereto as Exhibit L related to certain
office space occupied by the Business at Intergraph's
Huntsville, Alabama headquarters (the "Lease Agreement"),
duly executed by USI;
(k) At the Principal Closing, the Agreement for
Engineering Services in the form attached hereto as Exhibit
M providing for, among other things, the services of
Intergraph's Software engineers in India to be provided to
USI under the terms thereof (the "India Support Agreement"),
duly executed by USI;
(l) At the Principal Closing, the Transition Services
Agreement in the form attached hereto as Exhibit N pursuant
to which Intergraph will provide certain support services to
USI on a transition basis following the Principal Closing
(the "Transition Services Agreement"), duly executed by the
Acquiring Entities;
(m) At the Principal Closing, the Version 4 Reseller
Agreement in the form attached hereto as Exhibit O pursuant
to which USI will be designated as a reseller of Version 4
of SolidEdge (which version contains the ACIS Software
referred to in clause (m) of the definition of Retained
Assets) (the "Version 4 Reseller Agreement"), duly executed
by USI;
(n) At the Principal Closing, the Trademark License
Agreement in the form attached hereto as Exhibit P pursuant
to which Intergraph will grant a perpetual, royalty-free
license to USI and its Affiliates to use certain Trademarks
described therein (the "Trademark License Agreement"), duly
executed by USI;
(o) At the Principal Closing, the Patent License
Agreement in the form attached hereto as Exhibit Q pursuant
to which Intergraph will grant a perpetual, royalty-free
license to USI and its Affiliates to use certain Patents
described therein (the "Patent License Agreement"), duly
executed by USI;
(p) At the Principal Closing, the Escrow Agreement,
duly executed by USI; and
(q) At the applicable Closing, other documents or
instruments as the Selling Entities participating in the
Closing may reasonably request; provided, however, that any
such request shall be subject to any limitations or
restrictions expressly provided in this Agreement.
2.5 Closing Deliveries by Selling Entities. Intergraph
shall deliver to USI the following:
(a) At the applicable Closing, a copy of the Charter (as in
effect on the Closing Date) of each Selling Entity
participating in the Closing certified as of a recent date
to the Closing Date (or, if such certification is not
obtainable in a particular jurisdiction, a certified copy as
of the nearest practicable date to the Closing Date) by the
Secretary of State (or other appropriate official) of the
respective State or other jurisdiction of its incorporation
or organization;
(b) At the applicable Closing, a copy of the Bylaws (as in
effect on the Closing Date) of such Selling Entity
participating in the Closing, certified as of such Closing
Date by the Secretary or Assistant Secretary (or other
appropriate officer) of such Selling Entity;
(c) At the applicable Closing, a copy of all resolutions
adopted by the Board of Directors or other governing body of
such Selling Entity participating in the Closing (together
with a copy of all resolutions adopted by the shareholders
of such Selling Entity where legally required), authorizing
the execution, delivery and performance by the Selling
Entity of this Agreement and the other agreements
contemplated hereby to which such Person is a party (and any
applicable Power of Attorney), and the consummation of the
transactions contemplated hereby and thereby, certified as
of the Closing Date by the Secretary or Assistant Secretary
(or other appropriate officer) of such Selling Entity;
(d) At the applicable Closing, appropriate evidence of all
Consents referred to in Schedule 2.5(d) relating to such
Closing;
(e) At the applicable Closing, certificates of existence
and, to the extent available in the appropriate
jurisdiction, good standing (including evidence of payment
of any franchise Taxes), and bring down telegrams or telexes
if issued in such jurisdiction, dated, to the extent
practicable, within the five-day period preceding the
Closing Date (i) with respect to Intergraph, from the
appropriate Tribunals in the States of Delaware and Alabama
and (ii) with respect to any other Selling Entity
participating in the Closing, from the appropriate Tribunals
in such Selling Entity's jurisdiction of incorporation or
other organization;
(f) At the applicable Closing, duly executed certificates
of the Secretary or Assistant Secretary (or other
appropriate officer) of such Selling Entity participating in
the Closing, certifying as of the Closing Date as to the
incumbency and signature of the officers of such Selling
Entity who have executed this Agreement and the documents
delivered at such Closing on behalf of such Person (or any
applicable Power of Attorney);
(g) At the Principal Closing, a duly executed legal opinion
of Intergraph's corporate counsel as to the matters set
forth on Exhibit R;
(h) At the Principal Closing, the General Bill of Sale,
duly executed by Intergraph, dated the Principal Closing
Date;
(i) At the Principal Closing, a Copyright Assignment in the
form attached hereto as Exhibit S-1 ("Copyright Assignment")
and a Trademark Assignment in the form attached hereto as
Exhibit S-2 ("Trademark Assignment"), each duly executed by
Intergraph and dated the Principal Closing Date;
(j) At the applicable Closing, appropriate evidence,
satisfactory to USI, that the Successor Distributor
Contracts identified in Schedule 2.5(j) have been entered
into by the appropriate Selling Entity participating in the
Closing, in each case upon the terms and conditions
previously agreed to by the parties, and that such Contracts
can be assigned to the appropriate Acquiring Entity without
any further consent or notification;
(k) At the Principal Closing, copies of any and all
releases, termination statements and other documents and
instruments as are necessary to remove and release any Liens
which may encumber any of the Acquired Assets to be
transferred at any Closing (regardless of whether such
Closing is occurring concurrently with the Principal
Closing);
(l) At the Principal Closing, the SolidEdge Reseller
Agreement, duly executed by Intergraph;
(m) At the Principal Closing, the SolidEdge License
Agreement, the EMS License Agreement and the CAD II
Trademark Agreement, each duly executed by Intergraph;
(n) At the Principal Closing, the SolidEdge Common
Code License Agreement, duly executed by Intergraph;
(o) At the Principal Closing, the BAG Products License
Agreement, duly executed by Intergraph;
(p) At the Principal Closing, the INGR Tools License
Agreement, duly executed by Intergraph;
(q) At the Principal Closing, the Lease Agreement,
duly executed by Intergraph;
(r) At the Principal Closing, the India Support
Agreement, duly executed by Intergraph;
(s) At the Principal Closing, the Transition Services
Agreement, duly executed by the Selling Entities;
(t) At the Principal Closing, the Version 4 Reseller
Agreement, duly executed by Intergraph;
(u) At the Principal Closing, the Trademark License
Agreement, duly executed by Intergraph;
(v) At the Principal Closing, the Patent License
Agreement, duly executed by Intergraph;
(w) At the Principal Closing, the Escrow Agreement,
duly executed by Intergraph;
(x) At the applicable Closing, such other instruments of
assignment or transfer as the applicable Acquiring Entity
may reasonably request and shall be necessary or appropriate
in order to more effectively convey and transfer the
Acquired Assets to be transferred at such Closing to the
applicable Acquiring Entity or for aiding and assisting,
collecting and reducing to possession, and exercising, any
rights with respect thereto; provided, however, that any
such request shall be subject to any limitations or
restrictions expressly provided in this Agreement;
(y) Concurrently with the Principal Closing, CD-ROMs and
tapes containing the SolidEdge Common Code, the SolidEdge
Specific Code, the BAG Tools, and the EMS Code, the delivery
of which will occur at the site of the principal operations
of the Business in Alabama; and
(z) At the applicable Closing, other documents or
instruments as the Acquiring Entities participating in such
Closing may reasonably request; provided, however, that any
such request shall be subject to any limitations or
restrictions expressly provided in this Agreement.
2.6 Other Deliveries. With respect to any aspect of the
Principal Closing or any International Closing other than the
Bill of Sale Transaction, each Selling Entity and each Acquiring
Entity participating in such Closing shall deliver to the other
applicable parties on the Closing Date a duly executed copy of a
Closing Agreement, together with a duly executed copy of such
other instruments of transfer, conveyance and assignment and
other documents attached thereto or referred to therein, in each
case dated as of the applicable Closing Date.
2.7 Responsibility for the Retained Liabilities.
Notwithstanding anything in this Agreement, any closing document
or otherwise to the contrary:
(a) None of the Acquiring Entities or any of their
Affiliates, individually or collectively, shall be
responsible for, or shall assume or undertake to pay,
perform, satisfy or discharge, any of the Retained
Liabilities or any other liability or obligation, other than
the Assumed Liabilities and those Transaction Taxes, if any,
specified in Section 10.13, of any Selling Entity.
(b) Intergraph and its Affiliates (including the Selling
Entities) and their respective successors and assigns shall
be and remain responsible for the Retained Liabilities.
2.8 Allocation of the Consideration for the Acquired
Assets. The Consideration for the Acquired Assets shall
generally be allocated in accordance with the following
guidelines:
(a) The portion of the Consideration which is allocated
among the Acquired Assets located outside the United States
shall equal the respective fair market values of each of
such assets, which amounts are more particularly set forth
on Schedule 2.8 hereto.
(b) The remaining amount of the Consideration shall be
allocated to Acquired Assets located within the United
States, in accordance with their respective fair market
values as set forth on Schedule 2.8 hereto. The value of
the Acquired Assets located and to be delivered within the
United States will be set forth on Schedule I to the General
Bill of Sale, and USI and Intergraph agree that such
allocation shall be adopted by them in preparing, and shall
be reflected on, (i) any statements and any tax returns
required to be filed with any state or local taxing
authority and (ii) any invoice or other documentation
prepared with respect to Transaction Taxes.
As soon as practicable after the Principal Closing, USI shall
prepare and furnish to Intergraph detailed allocations that are
consistent with the allocations set forth on Schedule 2.8 and
Intergraph shall furnish USI with such information and
documentation as is reasonably requested by USI in order to
enable USI to prepare such detailed allocations. Such agreed
allocation shall be adopted by each of the Selling Entities and
Acquiring Entities in preparing, and shall be reflected on, (i)
the completed Form 8594 (Asset Acquisition Statement under
Section 1060 of the Code) which is required to be filed pursuant
to the requirements of Section 1060(b) of the Code, (ii) any
similar statements and any tax returns required to be filed with
any state, local or foreign taxing authority, (iii) each bill of
sale or similar document delivered by a Selling Entity to an
Acquiring Entity, and (iv) any invoice or other documentation
prepared with respect to Transaction taxes.
2.9 Waiver of Bulk Sales Compliance. The Acquiring
Entities and the Selling Entities hereby waive compliance with
the bulk transfer or bulk sales provisions of the applicable
state Uniform Commercial Code provisions or any other Legislative
Enactment; provided, however, that such waiver shall not
constitute a limitation of the rights of the Acquiring Entities
under Article IX.
2.10 Waivers of Deliveries or Conditions Precedent.
Notwithstanding any provision to the contrary in this Agreement
or in any certificate, document or instrument delivered pursuant
to this Agreement (including without limitation any Closing
Agreement), any express or implied waiver by the Acquiring
Entities of the requirement of the Selling Entities to deliver
any item or Consent to be delivered at any Closing (including
without limitation those items referenced in Section 2.5 or in
any Closing Agreement) or to satisfy any conditions precedent
shall not abrogate, diminish or otherwise affect any rights of
the Acquiring Entities under this Agreement, including without
limitation those rights set forth in Section 9.2.
2.11 Customer Contracts.
(a) As soon as practicable following the Principal Closing
Date, the applicable Selling Entity and the applicable Acquiring
Entity shall jointly notify each customer under a Customer
Contract (other than those identified on Section 2 of Schedule
3.23(a) which are being assigned to the Acquiring Entities) that
effective as of the Principal Closing Date the Business has been
transferred to the Acquiring Entities pursuant to this Agreement,
and such Selling Entity shall use its best efforts to assist the
applicable Acquiring Entity in obtaining a successor Customer
Contract with the applicable Acquiring Entity with respect to the
products and services of the Business on substantially the same
terms as the Customer Contract (a "Successor Customer Contract").
In the event that a Successor Contract is not entered into by the
customer and the applicable Acquiring Entity under terms
acceptable to both Persons prior to the termination of a Customer
Contract (under the current terms of the Customer Contract
without giving effect to any automatic renewal or "evergreen"
provisions thereof), the applicable Selling Entity shall continue
the performance of such Contract as contemplated in Section
2.11(b) below.
(b) During the period from the Principal Closing Date
through the earlier of (i) the termination of a Customer Contract
under the terms thereof (not giving effect to any automatic
renewal provisions thereof) and (ii) the date a Successor
Contract to a Customer Contract is entered into between the
customer and an Acquiring Entity as contemplated by Section
2.11(a) above (such period being referred to hereinafter as the
"Subcontract Period"), Intergraph and each other applicable
Selling Entity shall cause the benefits of their respective
right, title and interest (or the economic equivalent thereof)
under such Customer Contracts to be provided to the applicable
Acquiring Entity and shall cooperate with such Acquiring Entity
to provide such Acquiring Entity with such benefits, which
cooperation shall include without limitation: (A) maintenance by
Intergraph and each other applicable Selling Entity of rights
under such Customer Contract in their name in trust for the
benefit of such Acquiring Entity; (B) payment to the applicable
Acquiring Entity of amounts collected in respect of such Customer
Contract as follows: for payments received by a Selling Entity
during March 1998, by wire transfer to an account designated by
USI not later than 12:00 noon on the Wednesday following the week
during which such payment was received by a Selling Entity; and
for payments received by a Selling Entity after March 1998, by
wire transfer to an account designated by USI not later than
12:00 noon on the second Business Day following receipt thereof;
and (C) at the sole option and subject to the control of such
Acquiring Entity, enforcement for its benefit of any and all such
rights against a third party in the event such rights can not be
enforced by the Acquiring Entity. Unless not permitted under any
Assumed Contract with respect to which rights are made available
to an Acquiring Entity and except to the extent contemplated by
the Version 4 Reseller Agreement, the performance of such Selling
Entity's obligations thereunder shall be subcontracted or
sublicensed to such Acquiring Entity from the time such rights
are made available to such Acquiring Entity through the
termination of the Subcontract Period and the applicable
Acquiring Entity shall perform such obligations in accordance
with their terms. If such assignment, subcontracting or
sublicensing is not permitted, such Acquiring Entity will use
commercially reasonable efforts to perform and complete such
Assumed Contract in accordance with its terms from and after the
time such rights are made available; provided, however, that in
connection with the foregoing, such Acquiring Entity shall have
all rights and remedies against the other party to such Assumed
Contracts, including without limitation the right to cease
providing products and services thereunder if the other party
thereto fails to perform its obligations thereunder.
(c) Intergraph shall deliver to USI amounts prepaid under
Prepaid Maintenance Contracts in respect of the period following
the applicable Closing Date as follows: (i) concurrently with the
applicable Closing, Intergraph shall deliver to USI the amounts
prepaid under such Contracts in respect of the month in which
such Closing occurs (pro-rated from the applicable Closing Date);
and (ii) on the first day of each month thereafter, Intergraph
shall deliver to USI the amounts prepaid under such Contracts in
respect of each such month.
2.12 Distributor Contracts. Prior to the Principal Closing
Date, the Selling Entities shall use their best efforts to amend
each Distributor Contract to remove therefrom the products and
services of the Business and, except with respect to such
Distributor Contracts covering a territory or territories outside
of the United States identified on Schedule 2.12, to enter into a
separate successor distributor contract (a "Successor Distributor
Contract") covering the products and services of the Business on
terms reasonably acceptable to USI. For purposes of this
Agreement, terms consistent with those contained in the existing
Distributor Agreement shall be deemed to be reasonably acceptable
to USI. Each Successor Distributor Agreement shall be assignable
to USI or another applicable Acquiring Entity effective as of the
Principal Closing Date and shall be assigned at the Closing and
be an Assumed Contract hereunder (subject to the proviso set
forth in the definition of "Assumed Contract" in Section 1.1).
2.13 Consents. The parties will cooperate with each other
in good faith to timely obtain all Consents from any and all
Tribunals and other Persons that are required (i) for the
consummation of the transactions contemplated by this Agreement;
(ii) to permit the continued operation of that portion of the
Business conveyed on any Closing Date on or after such Closing
Date in substantially the same manner as it was carried on and
conducted prior thereto, including, without limitation, the
execution of Successor Contracts pursuant to Section 2.12 hereof;
and (iii) to prevent a breach of, a default, penalty or increase
in payment under, or a termination of any Contract relating to
the Business. The cost of obtaining such Consents shall be borne
by the party who is required to obtain such Consent under the
applicable Legislative Enactment or under the terms of the
relevant Contract, provided, however, that if the applicable
Legislative Enactment does not provide which party shall pay such
costs, the costs shall be borne equally by USI and Intergraph
(although in all cases each party shall pay the fees and expenses
of its own counsel). The parties hereto agree to use their best
efforts to obtain such Consents in a cost effective and efficient
manner. Until all Consents referenced in this Section 2.13 are
obtained, the applicable Selling Entities shall provide the
applicable Acquiring Entity with the rights and benefits, and the
Selling Entities shall in any event continue to have the
indemnity and hold harmless obligations set forth in Article IX.
2.14 Interim Operation for International Selling Entities.
(a) With respect to each International Selling Entity that
does not transfer and convey all of its respective portion of the
Business and Acquired Assets on the Principal Closing Date, from
and after the Principal Closing Date USI may, at its option,
designate one or more employees or other representatives of the
Acquiring Entities to serve as managers of the Business of each
such International Selling Entity to the extent permitted by
applicable law. The management of the Business of each
respective International Selling Entity shall report to, and be
subject to the direction of, such manager so designated by the
Acquiring Entities. Such managers may serve their functions on-
site at such International Selling Entities. The Acquiring
Entities shall be free to make oral and written communications to
the employees of the International Selling Entities during the
period following the Principal Closing Date (provided that
communications describing the terms of this Section 2.14(a) shall
be provided to Intergraph in advance of their release for their
prompt comment and review). During this period, USI may request
that the employment of any employee of the International Selling
Entity who would be a Transitioned Employee be terminated. In
such event, no later than five days following the date of such
request Intergraph may either (i) continue the employment of such
person for Intergraph's benefit (which continuation would not be
a violation of Section 5.7 hereof), in which event USI shall not
be obligated to reimburse USI for such person's salary upon the
occurrence of the applicable International Closing, or (ii)
terminate the employment of such person, in which event USI will
reimburse Intergraph for any required severance payments to any
such employee in accordance with Intergraph's severance policy.
(b) From and after the Principal Closing Date, the Business
of each International Selling Entity shall be conducted and
operated for the account and benefit of the applicable Acquiring
Entities. At the applicable International Closing for an
International Selling Entity, the Closing Agreement shall provide
for (i) the payment by the applicable Selling Entity to the
applicable Acquiring Entity of all revenues derived by the
portion of the Business attributable to such Selling Entity
(which revenues shall have been collected by the Selling Entities
and held for the benefit of the applicable Acquiring Entity)
during the period from and after the Principal Closing Date to
the date of the applicable International Closing (the "Interim
Period"), (ii) the reimbursement by the applicable Acquiring
Entity to the applicable Selling Entity of all expenses directly
attributable to the operation of the Business by such Selling
Entity during the Interim Period (and excluding any expenses
attributable to any other business or businesses of the Selling
Entities), including, without limitation, costs and expenses
associated with employment of the Transitioned Employees and
Taxes (other than Transaction Taxes) attributable to the
operation of the Business during the Interim Period, and (iii)
the payment of any excess of the amount described in clause (i)
over the amount described in clause (ii) (a "Profit Amount") from
the applicable Selling Entity to the applicable Acquiring Entity,
or the payment of any excess of the amount described in clause
(ii) over the amount described in clause (i) (a "Loss Amount")
from the applicable Acquiring Entity to the applicable Selling
Entity. The payment of any Profit Amount or Loss Amount, as the
case may be, shall be treated as an adjustment to the
Consideration payable in respect of such International Closing.
Not later than 15 Business Days following the applicable
International Closing, the applicable Selling Entity and
Acquiring Entity shall adjust the Profit Amount or Loss Amount,
as the case may be, based on any revenues or expenses which were
unidentified at the time of the International Closing and, based
on such post-closing adjustment, any excess amounts delivered at
the applicable International Closing pursuant to the immediately
preceding sentence shall be immediately returned and/or any
additional payments which would be required to have been made at
such International Closing pursuant to such sentence shall be
immediately paid by the applicable party. At an International
Closing, the applicable Selling Entity shall deliver to the
applicable Acquiring Entity cash in an amount equal to the
accrued liability of such Selling Entity in respect of employee
benefits (such as severance, termination indemnities or vacation)
which benefits are required to be assumed by the Acquiring Entity
as a matter of applicable law, except to the extent that such
liabilities are settled directly with the relevant employees at
the applicable Closing or are governed by Section 5.13(h) hereof.
(c) USI and Intergraph will use their commercially
reasonable best efforts to consummate all International Closings
as soon as practicable following the Principal Closing Date.
Until such time as all International Closings have been
consummated, USI and Intergraph shall cause their representatives
to confer frequently (and in any event not less frequently than
monthly) with each other regarding the status of such
International Closings.
ARTICLE III
REPRESENTATIONS AND WARRANTIES OF THE SELLING ENTITIES
To induce the Acquiring Entities to enter into this
Agreement and to consummate the transactions contemplated hereby,
the Selling Entities jointly represent and warrant to the
Acquiring Entities as follows and as may be additionally provided
in the applicable Closing Agreement:
3.1 Corporate Existence and Authority. Each Selling Entity
is a corporation or other legal entity (as indicated on
Schedule 3.1) duly organized, validly existing and to the extent
such a concept or a similar concept exists in the relevant
jurisdiction, in good standing under the laws of the state or
other jurisdiction of its incorporation or other organization, as
set forth on Schedule 3.1. Each Selling Entity has all requisite
power and authority to own and lease its properties and assets
and to carry on the Business, as such business is being conducted
currently. Schedule 3.1 contains a true, complete and correct
list of all jurisdictions in which any of the Selling Entities
owns or leases any real property or has employees or offices
relating to the Business. Each Selling Entity is duly qualified
and licensed to do business as a foreign corporation or entity
and is in good standing in all jurisdictions in which the nature
of the business being conducted requires it to be so qualified
except where the failure so to qualify may reasonably be expected
not to have a material adverse effect on the Business or the
Acquired Assets, taken as a whole.
3.2 Authorization and Effect of Agreement, Etc. Each
Affiliate of Intergraph whose action is legally required to
transfer to the Acquiring Entities the Acquired Assets in
accordance with this Agreement is listed as a Selling Entity on
the signature pages hereof. Each Selling Entity has all
requisite power and authority to enter into, execute and deliver
this Agreement and the other agreements contemplated hereby to
which such Person is a party and to perform its obligations
hereunder and thereunder and to consummate the respective
transactions contemplated hereby and thereby for such Selling
Entity. The execution, delivery and performance of this
Agreement by each of the Selling Entities and the other
agreements contemplated hereby to which such Person is a party
and the consummation by the Selling Entities of the transactions
contemplated hereby and thereby have been duly authorized by all
corporate and other entity action. This Agreement has been, and
the other agreements contemplated hereby to which any of the
Selling Entities is a party will be, duly executed and delivered
by each of the Selling Entities (to the extent such Person is a
party thereto) and constitute, or when executed and delivered
will constitute, the valid and binding obligation of the Selling
Entities, enforceable in accordance with its respective terms,
except that (a) such enforcement may be subject to bankruptcy,
insolvency, reorganization, moratorium or other similar
Legislative Enactments now or hereafter in effect relating to
creditors' rights generally, and (b) the remedy of specific
performance and injunctive relief may be subject to equitable
defenses and to the discretion of the court before which any
proceeding may be brought. This Agreement, the General Bill of
Sale, the Copyright Assignment, the Trademark Assignment, the
Transferred Intellectual Property License Agreements and the
Closing Agreements, when executed and delivered by the respective
Selling Entities, will be sufficient to assign, convey, transfer,
vest, perfect and confirm in the appropriate Acquiring Entities,
good and marketable title in and to the Acquired Assets.
3.3 No Violation. Except as set forth on Schedule 3.3,
neither the execution, delivery or performance by any of the
Selling Entities of this Agreement or of any other agreement
contemplated hereby to which any of such Persons is a party, nor
the consummation by any of the Selling Entities of any of the
transactions contemplated hereby or thereby in accordance with
the terms hereof or thereof does or will (with the passage of
time, the giving of notice or otherwise), with respect to any
Selling Entity (a) violate or conflict with any provision of the
Charter, Bylaws or other governance document of such Selling
Entity; (b) violate, conflict with, modify or cause any default
under or acceleration of (or give any party any right to declare
any default or acceleration, upon notice or passage of time or
otherwise with respect to), in whole or in part, any Contract
related to the Business to which such Selling Entity is a party
or by which such Selling Entity or any of the Acquired Assets is
bound; (c) violate, conflict with or cause any default under (or
give any party any right to declare any default, upon notice or
passage of time or otherwise, under) any Legislative Enactments,
Official Actions or any other restriction of any kind or
character to which such Selling Entity is a party or by which
such Selling Entity or any of its respective properties or any of
the Acquired Assets is bound; (d) result in the creation or
imposition of any Lien, proscription or restriction on any of the
Acquired Assets; or (e) permit any Tribunal to impose any
material restrictions or limitations of any nature on such
Selling Entity or its properties or activities.
3.4 Consents.
(a) Except as set forth in Schedule 3.4(a), no Consent of,
or registration, declaration or filing with, or permit from, any
Tribunal, lessor, lender or any other Person is required to be
made or obtained by any Selling Entity in connection with the
execution, delivery and performance by any of the Selling
Entities of this Agreement or the other agreements contemplated
hereby or the consummation of the transactions contemplated
hereby or thereby in accordance with the terms hereof and
thereof.
(b) After the Principal Closing, except with respect to
those Acquired Assets to be transferred at each International
Closing (and with respect to such Acquired Assets, after such
International Closing related thereto) and except as set forth on
Schedule 3.4(b), the Acquiring Entities shall have the
unrestricted right to own, use, operate and sell all or any of
the Acquired Assets and to conduct the Business as it is
currently conducted by the Selling Entities without the payment
of any royalty, license or other fee to any Person by USI or any
Affiliate of USI, including without limitation any transfer fee,
relicensing fee or other fee with respect to Software to be
transferred or assigned.
3.5 General Warranty. All written statements, certificates
or documents furnished by any Selling Entity in accordance with
this Agreement, taken as a whole, are true, complete and correct
in all material respects and do not contain any untrue statement
of a material fact or omit to state any material fact necessary
in order to make the statements contained herein or therein, in
light of the circumstances under which they were made, not
misleading, provided, however, that the only representation or
warranty made with respect to the Projections is the
representation and warranty set forth in Section 3.30.
3.6 Challenges To This Agreement. No suit, action,
proceeding or investigation against any Selling Entity
challenging this Agreement or any of the transactions
contemplated hereby or claiming damages in connection with this
Agreement or any of the transactions contemplated hereby has been
instituted or, to the knowledge of the Selling Entities (without
independent investigation), threatened.
3.7 Financial Statements. The Selling Entities have
provided to USI true, complete and correct copies of the
Financial Statements, which are attached hereto as Schedule 3.7.
The Financial Statements fairly present, except for the
presentation of footnote disclosures (which footnote disclosures
are not material to an understanding of the Financial Statements)
which will be provided as soon as practicable following the
Principal Closing pursuant to Section 5.6 hereof, the financial
position of the Selling Entities with respect to the Business and
the related results of operations at the dates and for the
periods covered thereby, subject with respect to quarterly
financial information to normal, recurring year-end audit
adjustments described in Section 1 of Schedule 3.7. The
Financial Statements have been prepared in accordance with GAAP,
other than the aforementioned footnote disclosures, applied on a
consistent basis during the periods involved. As of the Balance
Sheet Date, (A) none of the Selling Entities had any liability or
expense of any nature, whether accrued, absolute, contingent or
otherwise, and whether due or to become due, with respect to the
Business which was not reflected in the Financial Statements and
which was of a nature required under GAAP to be reflected in the
Financial Statements or disclosed in the notes thereto when
prepared, (B) all allowances and reserves set forth in the
Financial Statements were adequate for the respective purposes
for which they were established, and (C) there were no loss
contingencies (as such term is used in Statement of Financial
Accounting Standards No. 5) or contingent liabilities which were
of a nature required under GAAP to be reflected or disclosed and
were not reflected in the Financial Statements or will be
disclosed in the notes thereto. Since the Balance Sheet Date,
except for liabilities that have been incurred in the ordinary
course of the Business consistent with past practices, none of
the Selling Entities has incurred any material liability of any
nature (whether accrued, absolute, contingent or otherwise) with
respect to the Business. Except as set forth in Schedule 3.7(a),
none of the Selling Entities is liable upon or with respect to,
or obligated in any other way to provide funds in respect of or
to guarantee or assume in any manner, any debt, obligation or
dividend of any Person related to the Business. The Financial
Statements fairly reflect the liabilities accrued for the annual
incentive compensation benefits payable under the plans and
programs set forth in Schedule 3.25(c), consistent with prior
application of the terms of such plans and taking into account
performance to date.
3.8 Accounts Receivable. All of the Accounts Receivable
reflected in the Balance Sheet have arisen in connection with
bona fide sales and deliveries of goods, performance of services
or other bona fide business transactions in the ordinary course
of the Business, consistent with past practices (including
regular credit practices). All reserves reflected in the Balance
Sheet against doubtful accounts of, valid counterclaims or
setoffs by, rebates, discounts and allowances to, and returns
from, customers were established in a manner consistent with the
collection experience of the Business in prior years.
3.9 Customer Discounts. Except as set forth on Schedule
3.9, since December 31, 1996, no Selling Entity has granted any
rebates, discounts, advances or allowances to any customers of
the Business for products or services, except in the ordinary
course of business consistent with past practice.
3.10 SEC Reports. Intergraph has previously furnished to
USI true, complete and correct copies of Intergraph's (i) Annual
Report on Form 10-K for the year ended December 31, 1996, and
(ii) Quarterly Reports on Form 10-Q for the quarters ended
March 31, June 30, and September 30, 1997, each as filed with the
SEC. As of their respective filing dates and to the extent such
reports and statements relate to the Business, such reports and
statements complied in all material respects with all applicable
requirements of the Exchange Act and the rules and regulations
promulgated thereunder, and such reports and statements as of the
date of their respective filing did not contain any untrue
statement of a material fact or omit to state a material fact
required to be stated therein or necessary to make the statements
therein, in light of the circumstances under which they were
made, not misleading.
3.11 Absence of Changes. Except as set forth in
Schedule 3.11, since December 31, 1997 there has not been,
occurred or arisen any change in, or any event (including without
limitation any damage, destruction or loss whether or not covered
by insurance), condition or state of facts of any character that
individually or in the aggregate has or may be expected to have a
material adverse effect on the Acquired Assets or the Business,
taken as a whole. Since December 31, 1997, except as set forth
in Schedule 3.11: (a) no Selling Entity has taken or failed to
take any action the taking of which or failure of which to take,
as the case may be, would have violated any of the provisions of
Sections 5.2 or 5.3 if they had then been applicable to any
portion of the Business; and (b) there has not been any damage,
destruction or loss (whether or not covered by insurance)
affecting any of the Acquired Assets the result of which
individually or in the aggregate has or may reasonably be
expected to have a material adverse effect on the Business or the
Acquired Assets, taken as a whole.
3.12 Books and Records. Each Selling Entity makes and keeps
Books and Records with respect to the Business which, in
reasonable detail, accurately and fairly reflect in all material
respects its transactions and the acquisitions and dispositions
of its assets since the date of its organization. The present
system of internal accounting controls of each Selling Entity
with respect to the Business reasonably assures that: (a)
transactions are executed only in accordance with the general or
specific authorization of its management, (b) transactions are
recorded as necessary to permit the preparation of financial
statements in conformity with GAAP and to maintain accountability
for its assets, (c) access to its assets is permitted only in
accordance with the general or specific authorization of its
management, and (d) the recorded accountability for its assets is
compared with the existing assets at reasonable intervals and
appropriate action is taken with respect to any differences. No
Selling Entity has used any improper accounting practices with
respect to the Business, including any practices for the purposes
of deceptively reflecting or not reflecting any of its
properties, assets, liabilities, revenues or expenses in any of
its Books and Records.
3.13 Taxes. Except as otherwise disclosed on Schedule 3.13:
(a) Each Selling Entity has timely filed or will file in a
timely manner with the appropriate Tax or revenue service, taxing
authority, or taxing Tribunal (collectively, "Tax Tribunal") all
Tax Returns required to be filed regarding any period up to but
not including the applicable Closing Date which relates to Taxes
attributable to the Acquired Assets, and all such Tax Returns
were or will be correct and complete in all material respects.
(b) Each Selling Entity has paid or will pay on the
applicable due date all Taxes owing by any Selling Entity
(whether or not shown on any Tax Return), which are due and
payable on or before the applicable Closing Date.
(c) Except for claims that were resolved more than three
years ago, no claim has been made by any Tax Tribunal in a
jurisdiction where Intergraph, Intergraph (Deutschland) GmbH, or
Intergraph (Italia) L.L.C. did not file Tax Returns, that any of
such Persons is or may be subject to taxation by that
jurisdiction.
(d) Intergraph, Intergraph (Deutschland) GmbH, and
Intergraph (Italia) L.L.C. are neither presently under
examination by any tax authorities, nor in receipt of any notice
of impending examination. There are no pending and, to the best
knowledge of Intergraph, threatened, examinations, audits,
investigations, suits, or other legal proceedings involving, or
material assessments against, Intergraph, Intergraph
(Deutschland) GmbH, or Intergraph (Italia) L.L.C. with respect to
Taxes attributable to the Business, or any other material claims
for unpaid Taxes attributable to the Business, which have been or
may be asserted against any of those entities.
(e) There are no pending or threatened audits,
investigations, examinations, suits or other legal proceedings
involving, or material assessments against, any Selling Entity
with respect to Taxes attributable to the Business, or any other
material claims for unpaid Taxes attributable to the Business
which may be asserted against any Selling Entity.
(f) There are no Liens for Taxes upon any assets of any
Selling Entity, except for statutory Liens disclosed on Schedule
3.13 for Taxes or assessments not yet delinquent.
(g) All material amounts required to be withheld or
collected by any Selling Entity and paid to any Tax Tribunal for
income, social security, unemployment insurance, sales, excise,
use, property and other Taxes have been timely withheld or
collected and, to the extent required, have been timely paid,
remitted or deposited to or with the relevant Tax Tribunal.
(h) There are no material proposed reassessments of the
taxable value of any of the Acquired Assets or similar matters
pending with respect to any Tax Tribunal.
(i) No Selling Entity that is transferring any interest in
real property located in the United States is a "foreign person"
as that term is referred to in Section 1445(f)(3) of the Code.
(j) Intergraph will provide to USI within sixty days of the
Principal Closing Date, a document which shall be deemed to be
incorporated by reference into this Agreement as Schedule 3.13(j)
hereto extending the representations made in Sections 3.13(c)-(e)
above to all Selling Entities, with the same legal effects as if
included in this Agreement as of the date hereof. Should
Intergraph fail to timely deliver Schedule 3.13(j) to USI, then
the representations of Sections 3.13(c)-(e) above shall be deemed
to be representations by Intergraph with respect to all Selling
Entities which are not subject to any exceptions other than those
contained in Schedule 3.13. It is expressly acknowledged and
agreed that this Section 3.13(j) is intended solely to resolve a
logistical difficulty in obtaining sufficient and reliable
information with which to make the representations under Sections
3.13(c)-(e) with respect to all Selling Entities.
3.14 Disputes and Litigation. Except as set forth in
Schedule 3.14, there is not existing or pending or, to the best
knowledge of any of the Selling Entities (without independent
investigation), threatened (a) any suit, action, litigation,
proceeding, investigation, claim, complaint or accusation
affecting or against any Selling Entity with respect to the
Business or any of the Acquired Assets in or before any Tribunal
or (b) any Official Actions which individually or in the
aggregate has or may reasonably be expected to have a material
adverse effect on the Business or the Acquired Assets or to which
any Selling Entity is a party with respect to the Business.
3.15 Environmental Matters. To the best knowledge of any
of the Selling Entities, without independent investigation, the
Compliance Group has fully, completely and timely complied with,
and are currently in compliance with, all Environmental Laws and
all related permits, licenses, orders, approvals, waivers and
variances. Except as set forth in Schedule 3.15, to the best
knowledge of the Selling Entities, without independent
investigation, no Hazardous or Toxic Substances are, or have
been, used, generated, handled, treated, stored or disposed of
on, under or in, or transported from, the Compliance Property
except in full compliance with applicable Environmental Laws.
Except as set forth in Schedule 3.15, none of the Compliance
Group has ever received any complaint, order, citation or notice,
public or private, with respect to any possible violation of the
Environmental Laws or obligation or liability thereunder related
to the Business.
3.16 Bank Accounts. No Selling Entity maintains any bank
account, safe deposit box or similar arrangement relating
exclusively to the Business.
3.17 Year 2000 Compliance. All Software products included
within the Business, including without limitation the BAG Tools,
the INGR Tools, the SolidEdge Common Code, the SolidEdge Specific
Code and the SolidEdge and EMS products, are Year 2000 Compliant.
With respect to all such Software products, Intergraph has
completed the assessment stage for the determination of Year 2000
Compliance and concluded that no renovation is necessary.
3.18 Rights Used; Certain Relationships. Except as set
forth in Schedule 3.18, the Acquired Assets, including, without
limitation, the Transferred Intellectual Property Interests,
contain all rights, properties and assets utilized or necessary
in the conduct of the Business and are sufficient in all respects
to carry on and conduct the Business after each Closing in
substantially the same manner as it was carried on and conducted
prior thereto. No Affiliate of Intergraph other than the Selling
Entities holds any assets comprising a part of the Business. No
officer or director of any Selling Entity (or any relative of any
such director or officer) has any material business or other
relationship (as creditor, lessor, lessee, supplier, dealer,
distributor, franchisee, customer or otherwise) with any Selling
Entity with respect to the Business. To the best knowledge of
the Selling Entities, without independent investigation, none of
the Selling Entities or any of their respective Affiliates,
directors, officers, employees or agents has, directly or
indirectly, given or agreed to give any improper gift or similar
benefit to any creditor, lessor, lessee, supplier, dealer,
distributor, franchisee, customer, competitor or governmental
employee or official (domestic or foreign) (a) that could subject
any of the Acquiring Entities or any of its Affiliates to any
damage or penalty in any civil, criminal or governmental
litigation or proceeding, or (b) the absence or discontinuation
of which could have had a material adverse effect on the Business
or the Acquired Assets.
3.19 Title to Properties and Absence of Liens. Each Selling
Entity has good and marketable title or valid leasehold title to
its respective Acquired Assets, subject to no Liens or any other
adverse interests or restrictions of any kind except as disclosed
in Schedule 3.19 (such Liens being hereinafter collectively
referred to as "Permitted Encumbrances"), all of which Permitted
Encumbrances will be removed prior to the Principal Closing.
3.20 Real Property.
(a) Section 1 of Schedule 3.20(a) sets forth the street
address of all Real Property used in the Business, the Selling
Entity which holds the interest in such Real Property and whether
such interest is a leasehold interest or an ownership interest.
Section 2 of Schedule 3.20(a) sets forth the street address of
each parcel of Real Property occupied by the Business and with
respect to which the applicable Selling Entity and the applicable
Acquiring Entity shall enter into a lease. The respective Selling
Entity enjoys peaceful possession of its interest in all such
Real Property. The Real Property used in the Business and all
material personal property owned or leased and included in the
Acquired Assets or comprising a part of the Business are in good
operating condition and repair (ordinary wear and tear excepted)
and suitable and sufficient for the purposes for which used.
(b) None of the buildings, structures or improvements
located on the Real Property subject to the Lease Agreement is
the subject of any official complaint or notice of violation of
any material applicable zoning ordinance, building code or
regulation, and no such violation exists which materially
detracts from or interferes with the present use of such
properties or materially detracts from the value thereof or
materially impairs the operations thereon; and there is no zoning
ordinance, building code, use or occupancy restriction or
condemnation action or proceeding pending, or, to the best
knowledge of the Selling Entities, without independent
investigation, threatened with respect to any such building,
structure or improvement on any of the Real Property which would
materially detract from, or interfere with the present use of,
such parcel or materially detract from the value thereof or
materially impair the operations of the Business thereon, as
presently conducted.
3.21 Contracts. Schedule 3.21 sets forth a true, complete
and correct list, correlated with the applicable clauses of this
Section 3.21, of the following (true, complete and correct
copies, or if none, written descriptions, of which have been
provided or made available to USI, together with all exhibits,
amendments or modifications thereto):
(a) All Contracts relating to the Business containing any
provision, covenant or obligation limiting or restricting in
any manner whatsoever the ability of any of the Selling
Entities or any of the employees of the Selling Entities to
engage in any line of business, to sell any products or
services or to compete with or to obtain products or
services from any Person or limiting the ability of any
Person to compete with or to provide products or services to
any of the Selling Entities;
(b) All Contracts pursuant to which Intergraph or any of
its Affiliates may have granted, or agreed to grant, to
another Person exclusive rights with respect to any goods or
services, items of Software or territory relating to the
Business;
(c) To the extent not covered in clause (b) above, all
partnership, joint venture, profit-sharing or similar
Contracts with any Person relating to the Business;
(d) All Contracts that involve the disposition or
acquisition after the date hereof of any assets of any of
the Selling Entities relating to the Business that do not
relate to transactions entered into in the ordinary course
of business, consistent with past practices;
(e) All Contracts or arrangements (including without
limitation those relating to allocations of expenses,
personnel, services, equipment or facilities) between or
among Intergraph or any of its Affiliates with respect to
the Acquired Assets or the Business;
(f) All other Contracts relating to the Business, to the
extent not set forth above, that were not entered into in
the ordinary course of business, consistent with past
practices, and that individually involve the payment or
potential payment, pursuant to the terms of such Contracts,
of more than $10,000 individually or that are otherwise
material to the Acquired Assets or the Business;
(g) Each business name which has been used by any of the
Selling Entities with respect to any portion of the Business
(separately listed for each such portion or Person);
(h) All Contracts pursuant to which Intergraph or any of
its Affiliates may have granted, or agreed to grant (whether
or not any requirement such as the giving of notice, the
lapse of time or the happening of any further condition,
event or act has been satisfied), to another Person the
right to sublicense or transfer any Software relating to the
Business (other than to an Affiliate of such Person);
(i) All Contracts pursuant to which Intergraph or any of
its Affiliates may have delivered to another Person, or
granted or agreed to grant (whether or not any requirement
such as the giving of notice, the lapse of time or the
happening of any further condition, event or act has been
satisfied) to another Person the rights to obtain, any
source code to any Software relating to the Business;
(j) All Contracts pursuant to which Intergraph or any of
its Affiliates may have delivered to another Person, or
granted or agreed to grant (whether or not any requirement
such as the giving of notice, the lapse of time or the
happening of any further condition, event or act has been
satisfied) to another Person the rights to obtain, any
Software "keys" allowing access to additional modules or
programs of any Software relating to the Business;
(k) All performance bonds posted by any of the Selling
Entities in connection with the Business; and
(l) All outstanding bids involving amounts exceeding
$10,000 for new business or projects submitted by any of the
Selling Entities in connection with the Business.
3.22 Contract Status. Schedules 3.21, 3.23, 3.24(g),
3.31(b) and 3.32(b) set forth a true, complete and correct list
of all Contracts (true, complete and correct copies, or if none,
written descriptions, of which have been provided or made
available to USI, together with all exhibits, amendments and
modifications thereto) used in the Business, other than the
leases of Real Property referred to in Section 3.20 and the
Contracts listed on Schedule 3.22. Each such Contract is in full
force and effect and constitutes a valid, legal and binding
obligation of (i) the Selling Entity that is a party thereto,
enforceable against such Selling Entity in accordance with its
terms and (ii) to the knowledge of the Selling Entities, without
independent investigation, the other party thereto, enforceable
in accordance with its terms. No Selling Entity that is a party
to any such Contract, and to the knowledge of the Selling
Entities, without independent investigation, no other party to
such Contract, is in breach or default thereunder, and no notice
of default, defense, offset, counterclaim, termination,
cancellation or acceleration has been received by any party with
respect thereto. To the knowledge of the Selling Entities,
without independent investigation, (i) there exists no event or
condition that (with or without notice or lapse of time or both)
would constitute a breach or violation thereof, or a default
thereunder, or give rise to any right of offset, counterclaim,
termination, cancellation or acceleration pursuant thereto, (ii)
there is no threat to cancel, or not to renew or extend, any such
Contract which by its terms may be renewed or extended, and (iii)
there are no material disputes with respect to any such Contract.
No Selling Entity has any present expectation or intention of not
fully performing such Contract in accordance with its terms.
3.23 Certain Contracts.
(a) Customer Contracts. Section 1 of Schedule 3.23(a),
sets forth a true, complete and correct list of all executory
Contracts providing for the sale, lease or rental of products and
services of the Business. Except as set forth on Section 2 of
Schedule 3.23(a), all such Contracts also relate to the sale of
products and services of the Selling Entities not included within
the Business (such Contracts, other than those Contracts
identified on such Section 2 which are being assigned to the
Acquiring Entities, are referred to as the "Customer Contracts").
As a result, the Customer Contracts are not being assigned by the
Selling Entities to the Acquiring Entities but the Acquiring
Entities shall be entitled to the rights of the Selling Entities
under such Customer Contracts pursuant to the provisions of
Section 2.11 hereof. The enforceability of each such Customer
Contract and the rights and benefits of the Selling Entities
thereunder will not be affected by the execution and delivery of
this Agreement or any of the other agreements contemplated
hereby, the performance by the parties of their obligations
hereunder and thereunder or the consummation of the transactions
contemplated hereby and thereby, other than as specifically
provided for in Section 2.11 hereof. Each Contract identified on
Section 2 of Schedule 3.23(a) is assignable (and will be assigned
and transferred) by the respective Selling Entity to the
appropriate Acquiring Entity pursuant to the transactions
contemplated hereby without requiring any payment to, or Consent
from, any Person or any waiting period, payment of any charge,
fee or expense or any notice to any Person. Section 3 of
Schedule 3.23(a) sets forth a true and correct list as of the
date hereof of all Customer Contracts, including, without
limitation, any software warranty upgrade agreements, under which
a customer has prepaid a Selling Entity for products or
maintenance services ("Prepaid Maintenance Contracts"). The
Selling Entities will update the schedules set forth in this
Section 3.23 prior to an applicable Closing. The Selling
Entities shall take all action necessary so that the current term
of any Customer Contract shall not be extended either under the
terms thereof or by operation of law. No Customer Contract has a
current term ending after the one-year anniversary of the date
hereof (except such Customer Contracts as may be terminated by
the Selling Entities prior to such date, and the Selling Entities
agree to so terminate any such contract before such date at the
request of USI).
(b) Distributor, Reseller and Business Partner Contracts.
Schedule 3.23(b) sets forth a true, complete and correct list of
all distributor, reseller and business partner agreements related
to the Business (the "Distributor Contracts"), all of which as of
the date of this Agreement also relate to products and services
of the Selling Entities not included within the Business. Except
as may be modified by the amendments contemplated by Section 2.12
and except as set forth on Schedule 3.23(b), all Distributor
Contracts (i) are non-exclusive, (ii) with respect to Distributor
Contracts covering a territory or territories within the United
States are terminable by either party thereto on not greater 30
days notice, and (iii) with respect to Distributor Contracts
covering a territory or territories outside of the United States
are terminable by either party thereto on not greater than 90
days notice.
3.24 Employees.
(a) Schedule 3.24(a) sets forth a true, complete and
correct list of each manager, officer and employee of each of the
Selling Entities whose primary function relates to the Business,
together with each such Person's name, job title, current annual
compensation, amounts and forms of special fringe benefits, if
any, and duration of employment with such entity. Each of the
Selling Entities with respect to the Business (i) is in
substantial compliance with all applicable Legislative Enactments
and Official Actions regarding employment, wages and hours with
respect to their employees, consultants and independent
contractors and (ii) is not engaged in any unfair labor practice
or discriminatory employment practice. No lawsuit or complaint
against any Selling Entity with respect to the Business has been
filed or, to the best knowledge of the Selling Entities (without
independent investigation), threatened to be filed, with or by
the National Labor Relations Board, the Equal Employment
Opportunity Commission or any other Tribunal that regulates labor
or employment practices, and there is no grievance filed or, to
the best knowledge of the Selling Entities, threatened to be
filed, against any Selling Entity with respect to the Business by
any employee pursuant to any collective bargaining or other
employment agreement. There is no consultant or independent
contractor who, individually or together with others, is material
to the Business. None of the managerial employees of the Selling
Entities have any knowledge that any employee, consultant or
independent contractor with respect to the Business will
terminate his employment or cease to do business with the
Business after consummation of the transactions contemplated by
this Agreement. To the best knowledge of the Selling Entities
(without independent investigation), there are no material
controversies pending or threatened between any Selling Entity
and any of its employees with respect to the Business, and no
labor union or other organization represents or claims to
represent any of such employees' interests. Except as set forth
in Schedule 3.24(a), none of the Selling Entities has been a
party to any Contract with any union, labor organization or
collective bargaining unit with respect to any of its employees
conducting the Business and none of such employees outside of the
United States is represented by a works council. No union
organizing or election activities involving any employees of any
Selling Entity with respect to the Business are in progress or,
to the best knowledge of the Selling Entities (without
independent investigation), threatened.
(b) All payments due from any of the Selling Entities on
account of employer's social security contributions and employee
health and welfare insurance under applicable Legislative
Enactments with respect to the Business in respect of years and
periods (and portions thereof) ended on or prior to the Balance
Sheet Date were either paid prior to the Balance Sheet Date or
accrued in full as a liability on the Balance Sheet.
(c) All severance payments, if any, which as of the
applicable Closing Date would be payable by any of the Selling
Entities with respect to any of the Transitioned Employees under
the terms of any oral or written agreement or commitment have
been or will be paid on or prior to such applicable Closing Date.
(d) The Selling Entities have withheld proper amounts from
the Transitioned Employees (all of which has been timely remitted
to the appropriate Tax authority) and have timely filed or will
timely file all Tax Returns with respect to employee income Tax
withholding and social security and unemployment Taxes, all in
compliance with the Tax withholding provisions of the Code and
other applicable Legislative Enactments.
(e) No Selling Entity has made any payments, or is or may
become obligated to make any payments to any Person with respect
to the Business as a result of the transactions contemplated by
this Agreement which could result in "excess parachute payments"
(as defined in Section 280G(b) of the Code) to any such Person.
(f) Through the Principal Closing Date, the Selling
Entities shall have taken all necessary actions (if any) to
comply with the WARN Act, to the extent they are subject to such
act, and no Acquiring Entity shall have any disclosure or
announcement obligations under the WARN Act. As of the date
hereof, and in reliance upon the covenant of the Acquiring
Entities in Section 6.3 hereof, none of the Selling Entities
subject to the WARN Act contemplates any "plant closing" or
"employee layoff," as such terms are used in the WARN Act, with
respect to any employees of any of the Selling Entities.
(g) Schedule 3.24(g) sets forth a true, complete and
correct list of all employment agreements to which any Selling
Entity is a party with respect to any of the Transitioned
Employees.
(h) Schedule 3.24(h) sets forth a true, complete and
correct list of all employee manuals, policies, procedures and
work related rules that apply to any of the Transitioned
Employees.
(i) No Selling Entity has made any representations or
warranties or any other statements or communications regarding
any Acquiring Entity's right, ability, plan or intention to
dismiss any Transitioned Employee or the terms and conditions
upon which any such Transitioned Employee will be employed by any
Acquiring Entity, other than statements regarding the terms and
conditions of employment based on information provided by USI.
3.25 Employee Benefit Matters.
(a) Employee Welfare Benefit Plans. Schedule 3.25(a)
indicates therein each and every "employee welfare benefit plan"
(as defined in Section 3(1) of ERISA) maintained, contributed to
or to which contributions are required to be made by any of the
Selling Entities or any of their Affiliates with respect to
employees of the Business either presently or within the previous
12-month period, or any such plan related to the Business to
which any of the Selling Entities or any of their Affiliates
contributes, is required to contribute or has contributed,
including any such similar type of plan established, maintained,
or contributed to under the laws of any foreign country (such
plans being hereinafter collectively referred to as the "Employee
Welfare Benefit Plans"). Intergraph has delivered to USI true,
complete and correct copies of each and every Employee Welfare
Benefit Plan, together with all documents and instruments
establishing or constituting any related trust, annuity contract
or other funding instrument, and including any summary plan
descriptions or substantive communication to employees concerning
the establishment, operation or termination of any such plan.
(b) Employee Pension Benefit Plans. Schedule 3.25(b)
indicates therein each and every "employee pension benefit plan"
(as defined in Section 3(2) of ERISA) maintained, contributed to
or to which contributions are required to be made by any of the
Selling Entities or any of their Affiliates with respect to
employees of the Business either presently or within the previous
12-months, including any Multiemployer Pension Plan (as defined
in either Section 3(37) or Section 4001(a)(3) of ERISA) and
including any such similar plan established, maintained or
contributed to under the laws of any foreign country (such
employee benefit plans being hereinafter collectively referred to
as the "Employee Pension Benefit Plans"). Intergraph has
delivered to USI true, complete and correct copies of each and
every such Employee Pension Benefit Plan, together with such
copies of all documents or instruments establishing or
constituting any related trust, annuity contract or other funding
instruments, and including any summary plan descriptions or
substantive description or communication concerning such plan to
employees or participants therein.
(c) Other Employee Benefit Arrangements. Schedule 3.25(c)
indicates therein each and every stock option plan, pension plan,
collective bargaining agreement, bonus, incentive award, vacation
pay, severance pay or any other material personnel policy,
employee benefit plan arrangement, agreement or understanding
which any of the Selling Entities or any of their Affiliates
presently maintains or has maintained in the previous 12-month
period or to which any of the Selling Entities or any such
Affiliate contributes or has contributed in such period, or has
been required to contribute in such period, with respect to
employees of the Business and which is not required to be listed
in Schedule 3.25(a) or 3.25(b) (including with respect to any
plans which are unwritten, a detailed written description of
eligibility, participation, benefits, funding arrangements,
assets and any other matters which relate to the obligations of
the Selling Entities or their Affiliates). Intergraph has
delivered to USI a true, complete and correct copy of each such
plan together with copies of all documents or instruments
establishing or constituting any related trust, annuity contract
or other funding instruments, and including any substantive
communication to employees or participants concerning such plans.
(d) PBGC and Other Liabilities. Neither EDS, USI nor any
of their Affiliates will have any liability of whatever nature or
kind including with respect to the establishment, maintenance,
operation or termination of any employee benefit plan, practice
or program, including any Employee Welfare Benefit Plan, Employee
Pension Benefit Plan or other plan described in paragraph (c)
above, by reason of USI's acquisition of the Business, including
any liability to the PBGC, any employee benefit plan, the trustee
of any employee benefit plan or any employee or participant or
any other corporation, individual, trust, entity or government
agency.
(e) COBRA. Neither USI, EDS nor any of their Affiliates
will have any obligation to maintain any medical benefit plans,
programs or practices, nor to allow any individual, whether an
employee, participant, former employee or beneficiary of one of
the foregoing, to participate in any health care plan, by reason
of the health care continuation requirements of COBRA except with
respect to those individuals who actually become employees of USI
or its Affiliates, and thereafter an event occurs entitling the
employee, or some person related to the employee, to such health
care continuation coverage by reason of an employee's employment
with USI and participation in USI's medical benefit plans.
3.26 Compliance with Export Laws. Each of the Selling
Entities currently holds and is in compliance with the export
licenses listed with respect to such Person in Schedule 3.26;
such export licenses ("Validated Licenses") are the only export
license documents issued with respect to the Business and the
Acquired Assets as of the date hereof. Each of the Selling
Entities is also in compliance with the general export licenses
it relies upon with respect to the Business and the Acquired
Assets.
3.27 Inventories. As of the Balance Sheet Date, all of the
inventories and supplies that are reflected in the Balance Sheet
were in good condition, priced at the lower of cost (on the first-
in, first-out basis) or market, and (as to classes of items
inventoried and methods of accounting and pricing) determined in
a manner consistent with prior years. All of such inventories
and supplies (together with the inventories and supplies which
have been or will be purchased or acquired by any Selling Entity
with respect to the Business during the period from the Balance
Sheet Date to and including the applicable Closing Date) which
are included in the Acquired Assets were purchased or acquired in
the ordinary course of the Business, consistent with past
practices. All of the inventory included in the Acquired Assets
is in good condition and is not obsolete or defective. Purchase
commitments for merchandise are not in excess of normal
requirements and are not at prices in excess of market prices.
The Selling Entities have the types and quantities of inventory
appropriate, taken as a whole, to conduct the Business in
accordance with past practices.
3.28 Master Purchase Agreements. Schedule 3.28 sets forth a
true and correct list of those vendor agreements under which the
Selling Entities make purchases principally related to the
Business (excluding those that relate to assets or services
furnished by Intergraph for the benefit of all of its business
units, subsidiaries or divisions and not principally to the
Business, including, without limitation, accounting and legal
support and the services provided under the Transition Services
Agreement) (the "Master Purchase Agreements").
3.29 Compliance with Law. To the best knowledge of the
Selling Entities, without independent investigation, each of the
Selling Entities (a) has complied with all Legislative Enactments
and Official Actions applicable to its respective portion of the
Business or the Acquired Assets, and (b) has duly and timely made
all filings and submissions that are required by Legislative
Enactments to be made with respect to such portion of the
Acquired Assets or such Business, and has provided the Acquiring
Entities copies of all such filings and submissions that have
been made since January 1, 1993.
3.30 Projections. The financial projections for the
Business prepared by the Selling Entities and attached as
Schedule 3.30 (the "Projections") were prepared in good faith
and, when prepared and furnished to USI, were based solely upon
assumptions that Intergraph believed to be reasonable. None of
the Selling Entities has any reason to believe that that the
Business will not so substantially achieve the results described
in the Projections (other than the fact that the Business has not
substantially achieved such results through the date hereof and
that the failure to achieve such results may impact the ability
of the Business to timely achieve the results described in the
Projections), although no assurance is given that the results set
forth therein will be achieved or that actual results will not
differ materially from the results reflected therein.
3.31 Intellectual Property.
(a) Schedule 3.31(a), together with Schedule 3.32(a), set
forth a true, complete and correct list of all items of
Intellectual Property (i) which are owned by a Selling Entity or
an Affiliate of a Selling Entity, (ii) which also comprise a part
of the Business on the Principal Closing Date, and (iii) which
comprise a part of the Transferred Intellectual Property
Interests (the "Owned IP"). All patents, Trademark registrations
and Copyright registrations which are part of the Owned IP are in
good standing, are valid and subsisting, and are in full force
and effect in accordance with their terms.
(b) Schedule 3.31(b), together with Schedule 3.32(b), set
forth a true, complete and correct list of all items of
Intellectual Property (i) which no Selling Entity owns, but in
which a Selling Entity has a right or rights (by license or
otherwise) and (ii) which also comprise a part of the Business on
the Principal Closing Date (the "Not-Owned IP"; the Owned IP and
the Not-Owned IP collectively referred to as the "IP"). All such
items of Intellectual Property comprise a part of the Transferred
Intellectual Property Interests except as specifically noted
opposite the reference to any such item on Schedule 3.31(b) or
3.32(b). The right of the Selling Entities to use the Not-Owned
IP in the Business is solely under the written license agreements
or other Contracts listed on Schedules 3.31(b) and 3.32(b).
(c) To the best knowledge of the Selling Entities, without
independent investigation, the development, license, use, sale,
distribution and modification of the Owned IP by the Selling
Entities in connection with the Business, and the use of the Not-
Owned IP by the Selling Entities in connection with the Business,
has not infringed on or otherwise violated the rights of any
other Person or constituted an unlawful disclosure, use or
misappropriation of the right or rights of any other Person. The
continued and future license, use, sale and distribution of the
Owned IP by the Acquiring Entities and their agents,
representatives or Affiliates from and after the Principal
Closing in a manner which is substantially identical to the
license, use, sale and distribution by the Selling Entities prior
to the Principal Closing, and the continued and future use of the
Not-Owned IP by the Acquiring Entities and their agents,
representatives or Affiliates from and after the Principal
Closing in a manner which is substantially identical to the use
by the Selling Entities prior to the Principal Closing, shall not
constitute an infringement or other violation of the rights of
any other Person or constitute an unlawful disclosure, use or
misappropriation of the right or rights of any other Person. No
Selling Entity is in material violation of, or in default under,
any Contract or other legal requirement relating to the IP.
(d) There is (i) no suit, action, complaint, proceeding,
opposition, petition to cancel, interference, re-examination or
audit pending, or to the best knowledge of the Selling Entities
without independent investigation, threatened, with respect to,
(ii) to the best knowledge of the Selling Entities without
independent investigation, no presently existing factual basis
that is reasonably likely to result in any suit, action,
complaint, proceeding or formal audit contesting, and (iii) no
outstanding Official Action concerning, any of (A) the Owned IP
or, to the best knowledge of any of the Selling Entities without
independent investigation, the Not-Owned IP, (B) any right of the
Selling Entities to develop, license, use, sell, distribute or
modify the Owned IP or (C) any right under a Contract or any
other right of the Selling Entities to use the Not-Owned IP.
(e) Except as set forth on Schedule 3.31(e), the Selling
Entities have the right, which is non-terminable and not subject
to expiration or revocation, to develop, license, control or
regulate the use of, make, sell, have made, have used, perform,
copy, have sold, distribute and modify the Owned IP without any
valid legal or equitable claim by, or payment or other obligation
owing to, or Consent from, any Person, and the Acquiring Entities
will acquire at the Principal Closing (or at such other Closing
as appropriate) all of such rights in the Owned IP on the same
basis and geographic scope as that enjoyed by the Selling
Entities immediately prior to the Principal Closing, without any
diminution or alteration as a result of the Principal Closing (or
such other appropriate Closing).
(f) Except as set forth on Schedule 3.31(f) (and subject
only to the express terms of those Contracts which are listed in
Schedules 3.31(b) and 3.32(b) to the extent that true and
complete copies have been provided to USI), the Selling Entities
have the right, which is non-terminable and not subject to
expiration or revocation, to use the Not-Owned IP without any
valid legal or equitable claim by, or payment or other obligation
owing to, any other Person, and the Acquiring Entities will
acquire at the Principal Closing (or at such other Closing, as
appropriate) all of such rights on the same basis as that enjoyed
by the Selling Entities immediately prior to the Principal
Closing (or such other appropriate Closing), without any
diminution or alteration as a result of such Closing. Schedule
3.31(f) sets forth a true and complete list of all Consents
required to permit the Acquiring Entities to make, license, use,
have sold, have made, have used, perform, copy, make derivative
works of, sell, distribute and modify the Not-Owned IP on the
same basis as that enjoyed by the Selling Entities immediately
prior to the Principal Closing or at such other appropriate
Closing, without any diminution or alteration as a result of the
Closing or such other appropriate Closing (except with respect to
Software which may have been installed by a Transitioned Employee
on an individual personal computer included in the Acquired
Assets which Software is not used by other employees and is not
material to the Business).
(g) Except as set forth on Schedule 3.31(g), the rights to
develop, make, license, use, have sold, have made, have used,
perform, copy, make derivative works of, sell, distribute, modify
and exploit the Owned IP held by the Acquiring Entities
immediately after the Principal Closing (or such other
appropriate Closing) and the consummation of the transactions
contemplated by this Agreement will be the same rights to
develop, make, license, use, sell, have sold, have made, have
used, perform, copy, make derivative works of, distribute, modify
and exploit the Owned IP held by the Selling Entities immediately
prior to the Principal Closing (or such other appropriate
Closing) and consummation of the transactions contemplated by
this Agreement, without any diminution or alteration as a result
of the Closing or the consummation of any of the transactions
contemplated by this Agreement. The Transferred Intellectual
Property Interests set forth on Schedule 3.31(g) for which, to
the best of the Selling Entities' knowledge without independent
investigation, there is no functionally comparable equivalent
publicly available have been so designated.
(h) Except (i) with respect to rights under the agreements
entered into pursuant to this Agreement, (ii) as set forth in
Schedule 3.31(h) or in Schedule 3.21, and (iii) end-user licenses
for INGR Tools and non-source code licenses for BAG Tools, to the
best knowledge of the Selling Entities without any independent
investigation, no Selling Entity has granted or obligated itself
to grant to any Person any license, option or other right to
develop, make, license, sell, have sold, have made, have used,
perform, copy, make derivative works of, distribute or modify in
any manner any of the Owned IP, whether or not requiring payment
to any Selling Entity. To the knowledge of the Selling Entities
without independent investigation, no Person has either asserted
any right to develop, make, license, use, sell, have sold, have
made, have used, perform, copy, make derivative works of,
distribute or modify the Owned IP except in accordance with a
license or other Contract described on Schedule 3.31(h) or in
Schedule 3.21, or offered to grant any Selling Entity a license
or any other right of use with respect to the Owned IP. No
Selling Entity has any obligation to compensate any Person for
any development, license, use, sale, distribution or modification
of any of the Owned IP except as set forth in Schedule 3.21. No
consent, approval, or authorization of or by any other Person
will be required after the Closing either (i) for the Acquiring
Entities to develop, license, make, use, sell, have sold, have
made, have used, perform, copy, make derivative works of,
distribute, modify or exploit any of the Owned IP or (ii) for the
Acquiring Entities to use the Not-Owned IP. To the best knowledge
of the Selling Entities without any independent investigation, no
Person has or shall have any right to terminate or revoke any
grant to or other acquisition by any Selling Entity of any right
to develop, license, make, use, sell, have sold, have made, have
used, perform, copy, make derivative works of, distribute,
modify, or exploit any of the Owned IP. None of the Owned IP was
developed as part of the performance of any obligation for any
Tribunal, or any other Person which would require the taking of
any action, whether or not actually taken, in order for all
rights to the Owned IP to become vested in, or retained by, any
Selling Entity. Other than the Owned IP and the rights of any
Selling Entity in the Not-Owned IP, except as set forth in
Schedule 3.31(h) no Intellectual Property right is used in any of
the Business or is necessary for the conduct of any of the
Business as presently conducted.
(i) Schedule 3.31(i) sets forth a true, complete and
accurate list of all patents, patent applications, provisional
applications, Trademark registrations, applications for Trademark
registration, Copyright registrations, applications for Copyright
registration and other registrations of and applications to
register Owned IP by or for any Selling Entity with any
government or governmental instrumentality. All such patents and
registrations are in good standing, valid and subsisting, and are
in full force and effect in accordance with their terms. To the
best knowledge of the Selling Entities without any independent
investigation, no Person other than a Selling Entity has either
applied for any patent or registered any claim to Copyright with
respect to any part of the Owned Software.
(j) Except as set forth in Schedule 3.31(j) and to the
best knowledge of the Selling Entities without independent
investigation, (i) none of the Owned IP has been infringed by any
other Person, and (ii) none of the Owned IP is being used by any
other Person except pursuant to a license agreement or other
Contract as set forth in Schedule 3.31(h).
(k) To the best knowledge of the Selling Entities without
any independent investigation, there are no moral rights that
protect, affect, concern, or are related to any of the
Transferred Intellectual Property Interests, and no party will
assert any such rights.
3.32 Software.
(a) Schedule 3.32(a) sets forth a true, complete and
correct list of all items of Software (i) which are owned by a
Selling Entity, (ii) which comprise a part of the Business, and
(iii) which comprise a part of the Transferred Intellectual
Property Interests (the "Owned Software") and specifically shall
include (by way of example and not implying any limitation) all
of the Software commonly known as or described as a part of the
SolidEdge, EMS, Technovision and Proren systems. The Owned
Software shall include without limitation all earlier or
predecessor versions of any of such Software (whether or not
released) if and to the extent that such can be identified.
(b) Schedule 3.32(b) sets forth a true, complete and
correct list of all items of Software (i) which no Selling Entity
owns but in which a Selling Entity has a right or rights (by
license or otherwise) and (ii) which also comprise a part of the
Business (the "Not-Owned Software"). All such items of the Owned
Software and the rights of the Selling Entities under the Not-
Owned Software comprise a part of the Transferred Intellectual
Property Interests except as specifically noted opposite the
reference to any such item on Schedule 3.32(b). The right of the
Selling Entities to use the Not-Owned Software is solely under
the written license agreements or other Contracts listed in
Schedule 3.32(b). To the best knowledge of the Selling Entities
without independent investigation, the use by the Acquiring
Entities of the Not-Owned Software subject to the Contracts
referred to in clause (r) of the definition of Retained Assets in
Section 1.1 hereof (which Contracts are not included in the
Transferred Intellectual Property Interests) pursuant to
successor agreements entered into by USI, to the extent that the
Software covered thereby is the same as the Not-Owned Software
covered by such Contracts referred to in clause (r), will not
constitute an infringement or other violation of the rights of
any other Person or constitute an unlawful disclosure, use or
misappropriation of the right or rights of any other Person.
(c) All Owned Software is free from material defects in
programming and operation and performs in accordance with all
normal industry expectations for quality and relevant HELP files
and published user manuals therefor and in accordance with all
technical, promotional and other written material used or
provided to any Person in connection with the Owned Software.
(d) Except as permitted under the EMS License Agreement or
the SolidEdge License Agreement, Intergraph will not copy,
maintain, store, or archive any computer software source code
provided in the assets transferred to Unigraphics by the
concurrently executed Bill of Sale. Furthermore, except as
contemplated by the EMS License Agreement and the SolidEdge
License Agreement, Intergraph agrees that it will not have any
access whatsoever to any such computer software source code
except through Unigraphics who has sole discretion whether to
grant such access.
(e) No Software comprising a part of the Business (1)
contains any coded instructions, routine, or other means
(including but not limited to any back door) that would enable
any person or computer system, including authorized or
unauthorized users, to bypass any log-in and/or any security
feature of the Software or any computer on which the Software is
installed; (2) contains any coded instructions, routine or other
means (including but not limited to any time bomb or drop dead
device) that, when activated in accordance with a predetermined
method, date, or event, causes the Software to cease to operate,
to operate in a degraded manner, to damage or destroy data or
code, or otherwise deleteriously affect the functioning of the
Software, other programs, or the computer systems on which the
Software is installed, or with which such computer systems are in
communication (except demonstration versions or copies of
Software which cease to function at a predetermined date if not
purchased or if other similar action is not taken); (3) contains
any coded instructions, routine or other means that causes the
Software, other software, or the computer system on which the
Software is installed to perform an unauthorized function or to
operate in an unauthorized manner; or (4) contains any coded
instructions, routine or other means (including any virus, trojan
horse, or worm) that disables, erases, or otherwise harms
software, hardware or data or otherwise causes such actions.
3.33 Development and Protection of the Owned IP.
(a) The Owned IP consists exclusively of "works made for
hire" as that term is used in Title 17 of the United States Code,
and a Selling Entity is considered the author of each of such
works. The Owned IP was developed entirely by (i) full time
employees working within the scope of their employment within the
meaning of 17USC101 of a Selling Entity during the period (for
each such person, his "Engagement Period") in which either (I)
(A) he was a full time employee of a Selling Entity, (B) he was
employed only by a Selling Entity and (C) he was expressly
employed for the purpose of or his written job description in the
employment of a Selling Entity at the time of such actions
included as a primary duty the development of part of the Owned
IP or (II) he was subject to a valid and enforceable written
Contract (an "Employee IP Contract") which assigned to such
Selling Entity ownership of the work or works produced,
including, without limitation, all intellectual property rights
therein (such employee, solely when meeting all of these
criteria, referred to as a "Developer"), or (ii) independent
contractors or consultants engaged by a Selling Entity which have
assigned to such Selling Entity their entire right, title, and
interest in and to the work or works produced, including without
limitation all intellectual property rights therein pursuant to a
valid and enforceable written Contract (an "Independent
Contractor IP Contract") (such contractor or consultant meeting
these criteria also referred to as a "Developer"). No material
Owned IP includes (i) any Intellectual Property in which any
Person other than a Selling Entity has or may acquire any right
of ownership, control or compensation, or (ii) any invention made
by (A) any employee of a Selling Entity who was not hired to
invent at any time other than during his Engagement Period or
(B) any independent contractor or consultant engaged by a Selling
Entity who is not subject to an Independent Contractor IP
Contract, or (iii) the product of any effort to develop
independently, through a "clean room" effort or otherwise, an
expression in which any Person other than a Selling Entity has
intellectual property rights. None of the Owned IP is the
product of a joint invention or authorship by a Developer and any
Person who is not also a Developer. No right of any Person other
than a Selling Entity to any patent, patent application,
Trademark or Copyright is embodied in any of the Owned Software,
except as set forth on Schedule 3.33(a).
(b) Each Selling Entity has diligently taken reasonable
measures to protect for the sole use and benefit of the Selling
Entities the confidential and proprietary nature of the Trade
Secrets and the source code, object code and access codes for the
Software (the "Confidential Software"). Each Person, including
without limitation employees, agents, consultants, distributors
and licensees of the Selling Entities, who has had access to or
otherwise been exposed to any of the Trade Secrets or
Confidential Software (including without limitation any of the
source code for the Owned Software) has been advised of the
confidential and proprietary nature of the Trade Secrets and the
Confidential Software and any such agent, consultant, distributor
or licensee has been required to enter into a written agreement
("Confidentiality Contract") with the appropriate Selling Entity
acknowledging and agreeing that (i) the Owned IP is and shall
remain the sole and exclusive property of, and may be
confidential to, such Selling Entity, and (ii) the Owned IP is
not to be used or disclosed to any Person other than as
specifically authorized by such Selling Entity. Each of the
Confidentiality Contracts and Employee IP Contracts relating to
the Transferred Intellectual Property Interests was and is in
full force and effect, and constitutes the legal, valid and
binding obligation of each Selling Entity which is a party
thereto and, to the best knowledge of the Selling Entities
without independent investigation, each other Person which is a
party thereto, enforceable in accordance with its terms, except
that (iii) such enforcement may be subject to bankruptcy,
insolvency, reorganization, moratorium or other similar laws now
or hereafter in effect relating to creditors' rights generally,
and (iv) the remedy of specific performance and injunctive relief
may be subject to equitable defenses and to the discretion of the
court before which any proceeding may be brought. Each Selling
Entity has kept all of the Trade Secrets, including without
limitation all of the source code for the Owned Software,
strictly confidential and secret. The Trade Secrets are not and
have not been a part of the public knowledge or literature. No
Selling Entity has disclosed, divulged or otherwise provided
access to any part of the source code for the Owned Software
other than to Persons which have entered into written
Confidentiality Contracts with the appropriate Selling Entity or
who have a confidential relationship with the Selling Entity or a
duty to keep such source code for the Owned Software
confidential. To the best knowledge of the Selling Entities
without independent investigation, no Person which is a party to
an IP Contract or confidentiality agreement or has a confidential
relationship with any Selling Entity is in violation of, or in
default under, any term or provision of such Contract which
relates to the Owned IP.
(c) All Know-How comprising a part of the Business is
included in the assets assigned to the Acquiring Entities by the
Selling Entities in this Agreement. Schedule 3.33(c) sets forth a
true, complete and correct list of all locations where the
descriptions of any material Know-How comprising a part of the
Business is kept. Such descriptions explain the material Know-
How comprising a part of the Business. Each Selling Entity has
taken all commercially reasonable appropriate measures to protect
in all material respects the confidential and proprietary nature
of the information related to the business strategy, finances,
marketing plans or employees of the Business which has not been
published and is not generally known to the public.
3.34 Accuracy of Consent Schedules. Schedules 2.5(d) and
7.4 set forth a true, complete and correct list of all material
Consents from any Tribunal or other Person as may be necessary or
appropriate to consummate the transactions contemplated by this
Agreement in accordance with this Agreement and to enable the
Acquiring Entities to carry on and conduct the Business, in all
material respects, subsequent to the applicable Closing in
substantially the same manner as was carried on and conducted
prior to such Closing, or that are necessary to prevent a breach
of or a default or penalty, or increase in payments, under or a
termination of any material Contract relating to the Business.
3.35 Confidential Information. All confidential or
proprietary information relating to any aspect of the Business
which has been provided by any Selling Entity to any Person that
entered or proposed to enter into negotiations for the sale of
the Business (including a sale of capital stock of any Selling
Entity) or any portion thereof, whether or not under a Contract
or other assurances of confidentiality, has been destroyed or
returned to the applicable Selling Entity.
3.36 Brokers. None of the Selling Entities has authorized
any Person to act as a broker or finder or in any similar
capacity in connection with this Agreement or the transactions
contemplated hereby in such a manner as to give rise to a valid
claim against EDS or any of the Acquiring Entities for any
brokers' or finders' fees or similar fees or expenses.
3.37 Commercial Software. The Software subject to each of
the EMS License Agreement and the SolidEdge License Agreement are
commercial computer Software which is used regularly for other
than government purposes and is sold, licensed or leased in
significant quantities to the general public at established
market or catalog prices.
ARTICLE IV
REPRESENTATIONS AND WARRANTIES OF THE ACQUIRING ENTITIES
To induce the Selling Entities to enter into this Agreement
and to consummate the transactions contemplated hereby, USI
jointly represents and warrants with respect to itself and each
other Acquiring Entity, and each other Acquiring Entity with
respect to itself represents and warrants to the Selling Entities
as set forth in this Article IV and as may be additionally
provided in the applicable Closing Agreement. Notwithstanding
anything to the contrary set forth in this Agreement, Intergraph
acknowledges that the representations and warranties set forth in
this Article IV are qualified by the fact that as of the date of
this Agreement the formation of the Portugese branch of
Unigraphics Solutions Espana, S.A., the Finnish branch of
Unigraphics Solutions Sverige AB, and the legal entities in
Poland, Korea and the Czech Republic to consummate the
transactions contemplated hereby in those countries have not yet
been completed.
4.1 Corporate Existence and Authority. Each Acquiring
Entity is a corporation or (as indicated on Schedule 4.1) other
legal entity duly organized, validly existing and, to the extent
such a concept or similar concept exists in the relevant
jurisdiction, in good standing under the laws of the state or
other jurisdiction of its incorporation or other organization, as
set forth on Schedule 4.1. Each Acquiring Entity has all
requisite power and all requisite franchises, license, permits
and authority to own and lease its properties and assets and to
carry on its business, as such business has been conducted and is
being conducted currently. None of the Acquiring Entities is in
breach or violation of its Charter or Bylaws.
4.2 Authorization and Effect of Agreement, Etc. Each
Acquiring Entity has all requisite power and authority to enter
into, execute and deliver this Agreement and the other agreements
contemplated hereby to which such Person is a party and to
perform its obligations hereunder and thereunder and to
consummate the respective transactions contemplated hereby and
thereby for such Acquiring Entity. The execution, delivery and
performance of this Agreement by each of the Acquiring Entities
and the other agreements contemplated hereby to which such Person
is a party and the consummation by the Acquiring Entities of the
transactions contemplated hereby and thereby have been duly
authorized by all corporate and other entity action. This
Agreement has been, and the other agreements contemplated hereby
to which any of the Acquiring Entities is a party will be, duly
executed and delivered by each of the Acquiring Entities (to the
extent such Person is a party thereto) and constitutes, or when
executed and delivered will constitute, the valid and binding
obligation of the Acquiring Entities, enforceable in accordance
with its respective terms, except that (i) such enforcement may
be subject to bankruptcy, insolvency, reorganization, moratorium
or other similar laws now or hereafter in effect relating to
creditors' rights generally, and (ii) the remedy of specific
performance and injunctive relief may be subject to equitable
defenses and to the discretion of the court before which any
proceeding may be brought.
4.3 No Violation. Except as set forth in Schedule 4.3,
neither the execution, delivery or performance by any of the
Acquiring Entities of this Agreement or any other agreement
contemplated hereby to which any of such Persons is a party, nor
the consummation by any of the Acquiring Entities of any of the
transactions contemplated hereby or thereby in accordance with
the terms hereof or thereof, does or will (with the passage of
time, the giving of notice or otherwise) (a) violate or conflict
with any provision of the Charter or Bylaws of any Acquiring
Entity; (b) violate, conflict with, modify or cause any default
under or acceleration of (or give any party any right to declare
any default or acceleration, upon notice or passage of time or
otherwise, with respect to), in whole or in part, any Lien or
Contract to which any Acquiring Entity is a party or by which it
or any Acquiring Entity or any of its respective properties are
bound; (c) violate, conflict with or cause any default under (or
give any party any right to declare any default, upon notice or
passage of time or otherwise, under) any Legislative Enactments,
Official Actions or any other restriction of any kind or
character to which any Acquiring Entity is a party or by which
any Acquiring Entity or any of its respective properties is
bound; (d) result in the creation or imposition of any Lien,
proscription or restriction on any property or asset; or
(e) permit any Tribunal to impose any restrictions or limitations
of any nature on any Acquiring Entity or its respective
properties or activities.
4.4 Challenges To This Agreement. No suit, action,
proceeding or investigation against any Acquiring Entity
challenging this Agreement or any of the transactions
contemplated hereby or claiming damages in connection with this
Agreement or any of the transactions contemplated hereby has been
instituted or, to the knowledge of the Acquiring Entities,
without independent investigation, threatened.
4.5 Consents. Except as set forth in Schedule 4.5, no
Consent of, or registration, declaration or filing with, or
permit from, any Tribunal, lessor, lender or any other Person is
required to be made or obtained by any Acquiring Entity in
connection with the execution, delivery and performance by any of
the Acquiring Entities of this Agreement or the other agreements
contemplated hereby or the consummation of the transactions
contemplated hereby or thereby in accordance with the terms
hereof and thereof.
4.6 Brokers. Neither EDS nor any Acquiring Entity has
authorized any Person to act as a broker or finder or in any
similar capacity in connection with this Agreement or the
transactions contemplated hereby in such a manner as to give rise
to a valid claim against any of the Selling Entities for any
brokers' or finders' fees or similar fees or expenses, other than
Morgan Stanley & Co. Incorporated, the fees and expenses of which
will be paid by USI.
ARTICLE V
COVENANTS OF THE SELLING ENTITIES
5.1 Consummation of Transactions. Subject to the terms and
conditions herein provided, from the date hereof through its
applicable Closing Date, each Selling Entity will take, or cause
to be taken, all actions and do, and cause to be done, all things
necessary, proper or advisable to consummate and make effective,
as promptly as practicable, the transactions contemplated by this
Agreement in accordance with the terms of this Agreement
applicable to such Selling Entity. From the date hereof through
its applicable Closing Date, no Selling Entity shall voluntarily
take, and Intergraph shall cause each Affiliate of any Selling
Entity not to take voluntarily, any action or course of action
inconsistent with the satisfaction of the respective conditions,
terms and provisions of this Agreement or the consummation of the
respective transactions contemplated by this Agreement in
accordance with the terms of this Agreement applicable to such
Selling Entity.
5.2 Conduct of Business. From the date hereof and through
its applicable Closing Date, each Selling Entity will conduct
such portions of the Business as it may directly or indirectly
control only in the ordinary course of its respective portion of
the Business, consistent with past practices, unless USI shall
otherwise consent in writing. Without limiting the generality of
the foregoing, unless USI has given its prior written consent
otherwise, none of such Selling Entities will take any action
that would cause the breach of any covenant of such Selling
Entity in this Agreement (including in this Article V) or that
would cause the representations and warranties of such Selling
Entity in this Agreement (including those set forth in
Article III) to be untrue in any respect at any time through the
final Closing Date.
5.3 Preservation of Business. Without limiting the
generality of Section 5.1 and Section 5.2, from the date hereof
and through the applicable Closing Date, each Selling Entity
will, with respect to such portions of the Acquired Assets, the
Assumed Liabilities and the Business it may directly or
indirectly control:
(a) use its best efforts to preserve intact its present
business organization and not alter or change its methods of
operation;
(b) use its best efforts to preserve its goodwill and its
present business relationships with all Persons;
(c) use its best efforts to keep available the services of
its present officers and employees, except as USI may
otherwise require or direct, provided that the Selling
Entities shall not be obligated to increase compensation or
benefits outside of the ordinary course of business in order
to retain such persons;
(d) maintain and keep its respective portion of the
Acquired Assets in good repair and condition, normal wear
and tear excepted;
(e) pay and perform, when due, all obligations under its
Contracts relating to the Business and the Acquired Assets;
(f) comply with and perform all its obligations and duties
imposed by all Legislative Enactments and Official Actions,
except as may be contested by such Selling Entity in good
faith by appropriate proceedings;
(g) maintain in full force and effect policies of insurance
of the same type, character and coverage as the policies of
insurance listed with respect to it in Schedule 5.3;
(h) not amend or make other changes to its Charter or
Bylaws in any manner whatsoever that would inhibit or hinder
its ability to consummate the transactions contemplated
hereby;
(i) not purchase, sell, lease, mortgage, pledge or
otherwise acquire or dispose of its respective portion of
the Acquired Assets, except for tangible personal property
purchased, sold, leased or pledged in the ordinary course of
its respective portion of the Business, consistent with past
practices;
(j) not enter into, or become obligated under, any Contract
relating to the Business, or change, amend, terminate or
otherwise modify any such Contract, except as contemplated
by Section 2.12 and except for Customer Contracts and other
normal purchase, sale, license and lease agreements and
commitments for tangible personal property which are entered
into in the ordinary course of its respective portion of the
Business, consistent with past practices;
(k) not incur or commit to any capital expenditures,
obligations or liabilities, other than capital expenditures,
obligations or liabilities not in excess of $25,000 in the
aggregate;
(l) not change its method of accounting from that in effect
at the Balance Sheet Date;
(m) not increase or otherwise change the rate or nature of
the compensation (including wages, salaries, bonuses,
perquisites and benefits under pension, profit sharing,
deferred compensation and similar plans or programs) which
is paid or payable, directly or indirectly, to or for the
benefit of any of its officers or employees employed or
engaged primarily in connection with the Business or hire
any such employee at an annual salary in excess of $35,000,
or terminate any such employee whose annual compensation is
in excess of $35,000;
(n) not establish any employee plan or program as described
in Section 3.24 or 3.25 nor make, or commit to make, any
payment, contribution or award under or into any such
employee plan or program except in the ordinary course of
business as required thereunder;
(o) not modify, release or cancel any obligations,
indebtedness, liabilities or Liens (unless such obligation,
indebtedness, liability or Lien has been paid in full to
such Person at the time of release or cancellation) with
respect to the Business;
(p) not waive, compromise or settle any right or claim with
respect to the Business, or institute, settle or agree to
settle any litigation, action or proceeding with respect to
the Business before any Tribunal;
(q) not subject any of the Acquired Assets to any newly
created Lien or other adverse interest or restriction, other
than Permitted Encumbrances and Liens for Taxes not yet due
and payable that have been incurred in the ordinary course
of its respective portion of the Business, consistent with
past practices;
(r) not incur any indebtedness, obligation or liability,
except those arising in the ordinary course of its
respective portion of the Business, consistent with past
practices;
(s) not assume, guaranty or endorse the obligations of any
Person, except in the ordinary course of its respective
portion of the Business, consistent with past practices;
(t) except in the ordinary course of its respective portion
of the Business, consistent with past practices, not extend
any credit or commit to extend credit to any Person;
(u) not grant any rebates, discounts, advances or
allowances to any customers except in the ordinary course of
its respective portion of the Business, consistent with past
practices (without limiting the generality of the foregoing,
none of the Selling Entities shall provide any products
(including Software products) or services at discounted
rates or free of charge to any customer as a rebate,
discount or advance, except in the ordinary course of
business consistent with past practices); and
(v) use or sell the inventories and supplies in its
respective portion of the ordinary course of the Business,
consistent with past practices;
provided, however, that the Selling Entities shall not be in
breach of this Section 5.3 as a result of any act or omission to
act pursuant to the direction or approval of a USI manager
serving pursuant to Section 2.14 hereof.
5.4 Access to Information. From the date hereof to its
applicable Closing Date, each Selling Entity shall furnish, and
shall cause each Affiliate of the Selling Entities which it
directly or indirectly controls to furnish, the officers,
employees and agents of the Acquiring Entities reasonable access
to (a) the officers, employees, agents, properties, Books and
Records as they relate to its respective portion of the Business
and (b) all of its financial, operating and other data and
information with respect to such portion of the Business. The
Acquiring Entities shall have the right to review the Books and
Records of each Selling Entity as they relate to its respective
portion of the Business prior to the final Closing Date. Each
Selling Entity shall use its best efforts to allow the Acquiring
Entities to accomplish their reviews as rapidly as possible. No
such examination, inspection or audit by the Acquiring Entities
or their agents and representatives (whether in accordance with
this Section 5.4 or otherwise) shall in any way diminish, modify,
terminate or otherwise affect the respective representations,
warranties, covenants or agreements of each Selling Entity
contained in this Agreement or in any certificate or other
instrument furnished or to be furnished by any of the Selling
Entities or any Affiliate of any of the Selling Entities in
connection with this Agreement. Such access and information
shall be afforded to the officers, employees and agents of the
applicable Acquiring Entities by the applicable Selling Entities,
who shall also cause their respective officers, directors,
employees and agents (including attorneys and accountants) to
afford such access and information.
5.5 Notification of Certain Matters. Prior to its
applicable Closing Date, each Selling Entity shall give prompt
notice to USI of (a) any threatened or actual lawsuit, any
proposed settlement of any threatened or actual lawsuit and any
pending or threatened governmental action or proceeding of any
kind known to such Selling Entity which relates to its respective
portion of the Business or the Acquired Assets or the
transactions then contemplated by this Agreement; and (b) any
material failure of any of the Selling Entities to comply with or
satisfy any covenant, condition or agreement then remaining to be
complied with or satisfied by it hereunder.
5.6 Furnishing of Information. As soon as available but
not later than March 31, 1998, Intergraph will furnish to USI
unaudited statements of revenues and direct expenses of the
Business for the period commencing on January 1, 1998 and ending
on the Principal Closing Date in the form and detail similar to
those included within the Financial Statements, certified by the
chief financial officer or treasurer (or other comparable
officer) of Intergraph as being prepared in accordance with GAAP
and fairly presenting the results of operations of the Business
for the period then ended, subject to normal, recurring quarter-
end and year-end audit adjustments, as described therein.
Following the Principal Closing Date and prior to the
consummation of each International Closing, Intergraph will
furnish to USI, as soon as available, but in any event not later
than 30 days after the end of each calendar month, an unaudited
balance sheet for each Selling Entity which has not yet
consummated its International Closing with respect to the
Business as of the end of such month and the related unaudited
statements of revenues and direct expenses of such Selling Entity
with respect to the Business for such month in the form and
detail similar to those included within the Financial Statements,
certified by the chief financial officer or treasurer (or other
comparable officer) of Intergraph as being prepared in accordance
with GAAP and fairly presenting the financial position of the
Business conducted by the Selling Entity as of the dates thereof
and the results of operations of the same for the period then
ended, subject to normal, recurring quarter-end and year-end
audit adjustments, as described therein. All such financial
statements described above shall be true, complete and correct
and shall be prepared in accordance with GAAP applied
consistently throughout the periods reflected therein and with
prior periods (except as approved by such officer and disclosed
therein). The Selling Entities have been advised that USI
intends to include the Financial Statements (and possibly the
unaudited financial statements for the Business for periods
following January 1, 1998) in a Registration Statement on Form S-
1 to be filed with the Securities and Exchange Commission and
consent to the inclusion thereof in such Registration Statement
(and similar financial statements for subsequent periods
depending on the timing of the filing of such Registration
Statement). USI has been advised by the Securities and Exchange
Commission that it may include a statement of assets purchased in
such Registration Statement in lieu of the Balance Sheet, and
Intergraph agrees to promptly furnish such Statement to USI for
inclusion in any such Registration Statement. Intergraph will
obtain the consent of Ernst & Young to the inclusion of their
report on the Financial Statements in any such Registration
Statement and will instruct Ernst & Young to cooperate with a
reasonable request for a "comfort letter" which may be requested
by the underwriters.
5.7 Non-Solicitation. From the date hereof and until the
five-year anniversary of the Principal Closing Date, neither
Intergraph nor any Affiliate of Intergraph shall, directly or
indirectly, solicit for employment (other than through public
advertisements or other widely disseminated employment notices)
or hire any employee of any of the Selling Entities with respect
to the Business who is then currently employed by any of the
Acquiring Entities or any of their Affiliates, and during such
period, without the prior written consent of USI, Intergraph may
not offer employment or employ any person who identified on
Schedule 6.3 who does not accept the offer of employment by the
Acquiring Entities contemplated hereby.
5.8 Use of Owned Software. None of Intergraph, any other
Selling Entity or any of their Affiliates shall access, operate,
distribute, copy, use, or modify any of the Owned Software, other
than the Owned Software subject to the Transferred Intellectual
Property License Agreements and except as permitted under the
terms of the EMS License Agreement or the SolidEdge License
Agreement.
5.9 Expenses of Transaction. The Business has not incurred
or paid and will not incur or pay legal or consulting fees or
expenses in connection with any offer for sale of (a) the
Acquired Assets or the Business, (b) all or substantially all of
the assets of any Selling Entity or (c) the negotiation,
preparation, execution and delivery of this Agreement or the
consummation of the transactions contemplated hereby.
5.10 Further Assurances. If at any time after any Closing,
any Acquiring Entity shall consider or be advised that any
further assignments, conveyances, transfers or assurances in law,
or any other actions or things, may be necessary or appropriate
to assign, convey, transfer, set over or deliver to, or to vest,
perfect or confirm in, the applicable Acquiring Entity any right,
title or interest of any Selling Entity, of record or otherwise,
in or to the Acquired Assets or the Business or to place the
Acquiring Entities in operating control of any of the Acquired
Assets, the respective Selling Entities shall promptly execute,
deliver and record, or cause to be executed, delivered and
recorded, any and all such further instruments of assignment,
conveyance and transfer and take, or cause to be taken, all
actions and do, or cause to be done, all things, as may be
reasonably requested by the applicable Acquiring Entity to
assign, convey, transfer, set over and deliver to, and to vest,
perfect and confirm in, the appropriate Acquiring Entity all
right, title and interest of the Selling Entities, of record and
otherwise, in and to the Acquired Assets and the Business or to
place the Acquiring Entities in operating control of any of the
Acquired Assets, including, without limitation the execution,
delivery and filing of such documents and instruments as are
necessary in order to effectuate the transfer of the Transferred
Intellectual Property Interests to the applicable Acquiring
Entities; provided, however, that any such request shall be
subject to any limitations or restrictions contained in this
Agreement.
5.11 Period of Exclusivity. Except with respect to the
Acquiring Entities, during the period commencing on the date of
this Agreement and ending on the earliest to occur of (a) the
final Closing or (b) termination of this Agreement in accordance
with Section 10.2, none of the Selling Entities shall provide,
and each of the Selling Entities will cause its respective
directors, officers, employees and other representatives not to
provide, any information with respect to, or participate in any
discussions concerning, any corporate transaction relating to a
sale or transfer (directly, indirectly or by operation of law) of
any or all of the Acquired Assets, any merger or corporate
reorganization relating to all or any of the Acquired Assets or
any other significant corporate transaction involving any of the
Acquired Assets.
5.12 Noncompetition.
(a) The Selling Entities agree that during the seven-year
period commencing on the date of this Agreement they (i) will
not, either directly or indirectly (including through any
Affiliate), own, manage, control or operate or participate in the
ownership, management, operation or control of, any business,
whether in corporate proprietorship or partnership form or
otherwise, which engages in a Competitive Activity in any
location, whether inside or outside of the United States; (ii)
will not engage in a Competitive Activity at any place, whether
inside or outside of the United States, directly or indirectly
(including through an Affiliate), whether individually, in
partnership, jointly, or in conjunction with, or on behalf of,
any Person; and (iii) will not, directly or indirectly (including
through an Affiliate), whether individually, in partnership,
jointly, or in conjunction with, or on behalf of, any Person,
solicit or accept any business which requires engagement in
Competitive Activities; provided, however, the foregoing shall
not be deemed to prohibit the Selling Entities from the
performance of its obligations under the CAD II Contracts as
contemplated by the SolidEdge License Agreement, the EMS License
Agreement and the SolidEdge Reseller Agreement.
(b) The term "Competitive Activity" means the maintenance,
marketing or selling, or the development for marketing or sale by
a third party, of three-dimensional modeling Software intended
primarily for use in the automotive, aerospace or manufacturing
(including, without limitation, mechanical design of consumer
products, consumer electronics, computers and machine tooling)
industries for equipment design, machine design, product design,
finite element analysis, mechanism analysis or numerical control
tool path creation, provided, however, that the foregoing shall
not be deemed to restrict Intergraph from the maintenance,
marketing, development or sale of Software intended to be used
for the Intergraph Fields or the Joint Fields.
(c) The parties hereto specifically acknowledge and agree
that the remedy at law for any breach of the foregoing will be
inadequate and that the aggrieved party, in addition to any other
relief available to it, shall be entitled to temporary and
permanent injunctive relief without the necessity of proving
actual damage. In the event that the provisions of this Section
5.12 should ever be deemed to exceed limitations provided by
applicable law, then the parties hereto agree that such
provisions shall be reformed to set forth the maximum limitations
permitted; provided, however, nothing in this Section 5.12 shall
prevent a Selling Entity or any Affiliate thereof from acquiring
less than a 2% ownership interest in a company which is engaged
in a Competitive Activity. The provisions of this Section 5.12
shall not restrict Intergraph from engaging in any activity not
prohibited hereunder or by the exclusive nature of certain of the
Intellectual Property covered by the Transferred Intellectual
Property License Agreements.
5.13 Certain Employee Benefit Matters.
(a) Intergraph Incentive Benefits. Not later than seven
days following the Principal Closing Date, each Selling Entity
will pay to the Transitioned Employees identified on Schedule
5.13(a) any incentive compensation benefits due to such
Transitioned Employee through the Principal Closing Date and to
the other Transitioned Employees the pro rata portion of the
bonus payments to such persons through the Principal Closing Date
in accordance with the bonus scheme in effect for 1997.
(b) Intergraph Vacation Pay. Not later than seven days
following the Principal Closing Date, each Selling Entity will
pay an amount in respect of all accumulated vacation days and,
with respect to non-U.S. Transitioned Employees if required by
applicable law, accumulated holiday or similar benefits (in each
case based on the then current salary of the Transitioned
Employee or, outside the United States, as may otherwise be
required by law) as of the Principal Closing to each Transitioned
Employee who was employed immediately prior to such Closing by
such Selling Entity. Each of the Closing Agreements may set
forth additional obligations or procedures for effecting the
foregoing obligations of the Selling Entities organized outside
the United States and each branch of a Selling Entity organized
under the laws of the United States but whose branch operations
are conducted outside the United States.
(c) Intergraph Stock Incentive Plan. Intergraph shall
extend, for a period of three months from the date of termination
with respect to each Transitioned Employee, the exercise periods
under the Intergraph Corporation 1992 Stock Option Plan and the
Intergraph Corporation 1997 Stock Option Plan for all vested
awards as of the date of termination of employment by a Selling
Entity of such Transitioned Employee.
(d) Intergraph 401(k) Plan. Effective as of the date of
the termination of employment by a Selling Entity in connection
with this Transaction, Intergraph shall take all actions which
are necessary and appropriate to fully vest each Transitioned
Employee in all amounts in such employee's individual account in
the Intergraph Corporation SavingsPlus Plan (the "Intergraph
401(k) Plan"). Any Transitioned Employee who, as of the date of
termination of such employee's employment with a Selling Entity,
has an outstanding balance on any loan from the Intergraph 401(k)
Plan, shall be eligible to transfer such loan, along with all
amounts vested in such employee's Intergraph 401(k) Plan
individual account, into the EDS Deferred Compensation Plan ("EDS
401(k) Plan") pursuant to a trust-to-trust transfer ("Plan Asset
Transfer") made in accordance with the administrative policies
and procedures of the Electronic Data Systems Deferred
Compensation Plan (the "EDS 401(k) Plan") and Section 414(l) of
the Code, provided that at the time of the Plan Asset Transfer
Intergraph can represent and warrant to EDS that the Intergraph
401(k) Plan (i) provides for Plan Asset Transfers and (ii) is a
qualified employee pension benefit plan in compliance with Code
Sections 401 et seq. The plan administrator of the Intergraph
401(k) Plan shall, upon reasonable request, promptly provide the
plan administrator of the EDS 401(k) Plan with any and all data,
records and other information pertaining to any Transitioned
Employee, a beneficiary, dependent, spouse or former spouse of
any Transitioned Employee, the Intergraph 401(k) Plan individual
account for any Transitioned Employee, and any other information
considered necessary and appropriate for the plan administrator
of the EDS 401(k) Plan to establish and administer an individual
account for any Transitioned Employee in the EDS 401(k) Plan.
The plan administrator of the Intergraph 401(k) Plan shall
further cooperate to take all such reasonable actions as are
necessary or appropriate for such plan administrator to take to
effect the Plan Assets Transfer in a timely and efficient manner,
including the filing of any reports, notices or disclosures which
may be required by any governmental agency.
(e) Foreign Nationals. The Transitioned Employees
identified on Schedule 5.13(e) are foreign nationals working in
the United States ("Foreign National Employees"). Each Foreign
National Employee shall remain employed by Intergraph until such
persons are granted permanent United States residency by the
Department of Immigration (the "Transition Date"). During the
period from the applicable Closing Date through the applicable
Transition Date, each Foreign National Employee shall be employed
by Intergraph for the full-time benefit of USI and the Acquired
Business, and USI shall reimburse Intergraph for their salaries
at the rates set forth opposite their respective names on
Schedule 5.13(e), which rates are the current salaries of such
persons, and for the direct benefit costs of Intergraph
attributable to such persons. During this period, USI may
request that the employment of any such person be terminated. In
such event, later than five days following the date of such
request Intergraph may either (i) continue the employment of such
person for Intergraph's benefit, in which event USI shall
discontinue payments of salary reimbursement, or (ii) terminate
the employment of such person, in which event USI will reimburse
Intergraph for any required severance payments to any terminated
Foreign National Employee in accordance with Intergraph's
severance policy.
(f) Employment Assistance. Each Selling Entity will
cooperate with the applicable Acquiring Entity in (i) where the
law so requires, the facilitation of the transfer of the
employees of the Selling Entity engaged in the Business to the
relevant Acquiring Entity, (ii) the performance by such Acquiring
Entity of its obligations under Section 6.3 to offer employment
with USI or another Acquiring Entity to such employees of the
Business as such parties shall agree upon prior thereto or in the
applicable Closing Agreement and (iii) such Acquiring Entity's
effort to employ such employees. No Selling Entity will (A)
except with the written consent of USI, make any representations,
promises or other communications, whether written or oral, to
such employees regarding employment with any of the Acquiring
Entities or employee benefits, plans or practice of the Acquiring
Entities, or (B) take any act that diminishes any Acquiring
Entity's right to dismiss, subject to applicable law, any such
employee with or without cause.
(g) Expense Report Reimbursement. Each Selling Entity will
reimburse a Transitioned Employee for any business related
expenses incurred by that Transitioned Employee with respect to a
period prior to the Principal Closing in accordance with the
Selling Entities' standard expense reimbursement policy.
(h) Transfer of Certain Non-U.S. Pension Assets.
I) At or prior to the applicable International Closing,
Intergraph shall contribute in cash to the underlying trusts (or
comparable funding arrangements) of the EDS pension plans (the
"EDS Pension Trusts") or in the case of an unfunded book reserve
maintained by Intergraph or an Affiliate of Intergraph, to USI
(which shall accept such funds on behalf of EDS) an amount equal
to the Projected Benefit Obligation value ("PBO") of the benefits
accrued for and in respect of the Transitioned Employees under
the applicable Intergraph pension plan as determined under the
rules of the respective Intergraph pension plan and applicable
law as if the Transitioned Employee's employment with a Selling
Entity had terminated the day before the applicable Closing Date.
The PBO will be calculated using the Intergraph pension plan
rules as in effect on the applicable Closing Date and the
actuarial methodology and assumptions which were applicable for
the EDS annual disclosure under FAS87 as of December 31, 1997.
For this purpose, each Transitioned Employee shall be deemed to
have a fully vested benefit under the applicable Intergraph
pension plan. Notwithstanding the foregoing, to the extent that
the applicable Intergraph pension plan is a defined contribution
plan, the PBO shall refer to each Transitioned Employee's full
account balance credited to him or her under the Intergraph
pension plan, consisting of both employee and employer
contributions and any adjustments thereon due to investment
performance, as of the applicable Closing Date.
II) To the extent permitted by law, all payments will be
made directly from the underlying trust (or other comparable
funding arrangements) of each Intergraph pension plan (the
"Intergraph Pension Trusts") to the corresponding EDS Pension
Trust in the respective country and, to the extent so paid,
Intergraph's obligation to pay the amounts referred to in (I)
above shall be correspondingly reduced. If, under applicable law
the legally required minimum amount to be transferred exceeds the
PBO, then such payment will in no event be less than the amount
necessary to satisfy the requirements of any applicable law.
III) Intergraph shall pay interest on the amount
payable to the EDS Pension Trust or USI, as the case may be,
accruing for the period beginning on the day after the Principal
Closing Date until the date the amount is paid to the EDS Pension
Trust at the discount rate per annum used to calculate the PBO.
To the extent permitted by law, this payment shall be made from
the Intergraph Pension Trusts to the EDS Pension Trusts.
IV) For each Transitioned Employee, Intergraph will
transfer from the Intergraph Pension Trusts, and USI will assume
(or cause the applicable EDS pension plan to assume) as of the
EDS plan eligibility date, an amount of plan liabilities equal to
the PBO under the Intergraph pension plan as of the applicable
Closing Date.
V) All calculations contemplated herein shall be performed
by an actuary designated by USI, which may be reviewed by an
actuary designated by Intergraph prior to the transfer, and shall
be performed within 30 days after the applicable Closing Date, or
as soon thereafter as practicable (provided that to the extent
permitted by law all payments to be made at the applicable
Closing shall be estimated in good faith by USI and Intergraph
with such estimates to be confirmed on a post-closing basis by
such actuary or actuaries). EDS shall cause the EDS Pension
Trusts to accept their respective transfer of plan assets and the
corresponding EDS Pension Plans to assume their respective
transfer of liabilities (such transfers of plan assets and
liabilities and the acceptance of such assets and assumption of
such liabilities shall hereafter be referred to as the
"Transfers"). The Transfers will be accomplished in full
compliance with applicable law. Further, Intergraph and USI will
file or cause to be filed in a timely manner whatever reports,
forms and notices as are necessary under applicable law as a
result of the Transfers. EDS and Intergraph agree to cooperate
with each other in providing the other on a timely basis with
employee data and other information which may be reasonably
required to effect the respective Transfers. Each Transfer will
be accomplished by way of a single transfer of plan assets and
liabilities from the respective Intergraph Pension Plan and will
not occur until the PBO under the respective Intergraph Pension
Plan has been determined.
5.14 Intergraph Guaranty. Intergraph hereby guarantees
to the Acquiring Entities the due and punctual performance by
each of the other Selling Entities of its respective obligations
under this Agreement and each of the Closing Agreements.
5.15 Enforcement of Confidentiality Agreement. The
Selling Entities agree to enforce, for the benefit of the
Acquiring Entities any and all rights of the Selling Entities
under any Contract retained by the Selling Entities pursuant to
which any confidential or proprietary information relating to any
aspect of the Business was provided by any Selling Entity to any
Person. The Selling Entities shall promptly inform the Acquiring
Entities of any breach of which they become aware by any Person
of the confidentiality obligations under any such Contract
relating to confidential or proprietary information relating to
the Business.
5.16 Confidential Information. Each of the Selling Entities
hereby acknowledges that the Acquiring Entities would be
irreparably damaged if any proprietary or confidential
information possessed by any of the Selling Entities concerning
the Business, the Acquired Assets or any of the Acquiring
Entities (except for any information that is or becomes generally
known to the public, otherwise than through a breach of this
Agreement) were disclosed to or used by any Person engaged in
competition with the Business or any of the Acquiring Entities.
Each of the Selling Entities agrees that it will not, and will
not permit any of its Affiliates, directors, officers, employees,
accountants, agents and other representatives to use or disclose
any such confidential or proprietary information, except as
expressly permitted hereunder or under any other agreement
between such Selling Entity and USI or any of its Affiliates. If
any Selling Entity is requested or required by any Tribunal to
disclose any of such proprietary or confidential information,
then such Selling Entity will provide USI with prompt written
notice of such request or requirement unless prohibited by
applicable law. USI may then either seek appropriate protective
relief from all or part of such request or requirement or waive
such Selling Entity's compliance with the provisions of this
Section 5.16 with respect to all or part of such request or
requirement. Such Selling Entity will cooperate with USI in
attempting to obtain any reasonable protective relief that USI
chooses to seek. If, after USI has had a reasonable opportunity
to seek such relief, USI fails to obtain such relief, then such
Selling Entity may disclose only that portion of such proprietary
or confidential information which its legal counsel advises it is
compelled to disclose.
5.17 Assistance and Cooperation. After each respective
Closing Date, each applicable Selling Entity agrees:
(a) to assist the applicable Acquiring Entities in
preparing any tax returns that such Acquiring Entities are
responsible for preparing and filing after such Closing Date
with respect to that portion of the Business and the
Acquired Assets conveyed on such Closing Date to the extent
such tax returns require information not included within
such Acquired Assets; to reasonably cooperate at the
Acquiring Entity's cost in preparing for any audits of, or
disputes with Tribunals regarding, any tax returns relating
to such portion of the Business and the Acquired Assets; and
to make available to the applicable Acquiring Entities and
to any Tribunal as reasonably requested all information,
records and documents relating to liabilities for taxes
associated with such portion of the Business or the Acquired
Assets;
(b) to provide the Acquiring Entities with reasonable
access to the portions of the Selling Entities' tax records
and reports, general ledgers and any other books, records,
files or correspondence which relate to the Business and to
preserve all such information, records and documents until
the expiration of any applicable statutes of limitation or
extensions thereof and as otherwise required by law; and
(c) to provide timely notice to the applicable Acquiring
Entities in writing of any pending or threatened tax audits
or assessments related to the Business or the Acquired
Assets for periods beginning after such Closing Date and of
which such Selling Entity has knowledge and to furnish such
Acquiring Entities with copies of all correspondence
received from any Tribunal in connection with any tax audit
or information request with respect to any such period.
5.18 Product Serial Numbers. At or prior to the Principal
Closing, Intergraph shall furnish to USI a block of not less than
100,000 serial numbers, assigned in accordance with Intergraph's
Gen Key internal system, which the Acquiring Entities may assign
following such Closing to the products of the Business. The
Selling Entities will not use any of such serial numbers assigned
to USI for any purpose following the Principal Closing.
ARTICLE VI
COVENANTS OF THE ACQUIRING ENTITIES
6.1 Consummation of Transactions. Subject to the terms and
conditions herein provided, from the date hereof through its
applicable Closing Date, each Acquiring Entity will use its best
efforts to take, or cause to be taken, all actions and to do, or
cause to be done, all things necessary, proper or advisable to
consummate and make effective, as promptly as practicable, the
transactions contemplated by this Agreement in accordance with
the terms of this Agreement applicable to such Acquiring Entity.
From the date hereof through its applicable Closing Date, each
Acquiring Entity shall not voluntarily take any action or course
of action inconsistent with the satisfaction of the respective
conditions, terms and provisions of this Agreement or the
consummation of the respective transactions contemplated by this
Agreement in accordance with the terms of this Agreement
applicable to such Acquiring Entity.
6.2 Notification of Certain Matters. Prior to its
applicable Closing Date, each Acquiring Entity shall give prompt
notice to Intergraph of any material failure of any of the
Acquiring Entities or any officer, director, employee or agent
thereof, to comply with or satisfy any covenant, condition or
agreement then remaining to be complied with or satisfied by it
hereunder.
6.3 Employment. Effective upon the Principal Closing, USI
will offer employment with USI or such Acquiring Entity to those
employees of the Business in the U.S. identified on Schedule 6.3
at the salaries set forth opposite their name on such Schedule,
which salaries were the rates in effect on December 31, 1997
(except for any increases approved by the President of USI). Such
offer shall be consistent with the hiring policies of USI and,
with respect to Transitioned Employees in the United States,
shall include employee benefits generally comparable to those of
other United States USI employees. USI reserves the right to
revoke the offer and refuse to hire any employee who does not
satisfy USI's pre-employment requirements. Effective upon each
International Closing, USI or another Acquiring Entity will make
a similar offer to those employees of the Business outside of the
U.S. identified on Schedule 6.3. USI shall recognize the service
with Intergraph of each United States Transitioned Employee for
purposes of its vacation policy. Nothing in this Agreement shall
diminish the right of USI or such other Acquiring Entity, subject
to any then applicable Legislative Enactments, to dismiss any of
those employees of the Selling Entities who become employees of
USI or such other Acquiring Entity with or without cause and to
change the terms and conditions of employment of any or all of
such employees.
6.4 Assistance with Specified Contracts and Litigation
Contracts. As referenced in the proviso to the definition of
Assumed Contracts in Section 1.1, no Specified Contract or
Litigation Contract shall be considered to be an Assumed Contract
under or by reason of this Agreement. With respect to any
Specified Contract or Litigation Contract to which a Selling
Entity is a party, the performance of the applicable Selling
Entity's obligations thereunder shall be deemed to be
subcontracted or sublicensed to the applicable Acquiring Entity
for the remainder of the term of the Specified Contract or
Litigation Contract, as the case may be, unless (a) in the case
of a Specified Contract, such Acquiring Entity reasonably
determines that such a subcontracting or sublicensing arrangement
effectively subjects such Acquiring Entity or any of its
Affiliates or any employees of such Acquiring Entity or any of
its Affiliates to a Non-Compete Covenant, (b) in the case of a
Litigation Contract, such Acquiring Entity reasonably determines
that such a subcontracting or sublicensing arrangement
effectively subjects such Acquiring Entity or any of its
Affiliates or any employees of such Acquiring Entity or any of
its Affiliates to any pending suit, action, litigation or
proceeding or (c) in either such case, such a subcontracting or
sublicensing arrangement is not permitted by such Specified
Contract or Litigation Contract, as the case may be. In any such
case, the applicable Acquiring Entity, at the expense of the
applicable Selling Entity, will use commercially reasonable
efforts to otherwise assist the Selling Entity that is party
thereto in the performance of such Selling Entity's contractual
obligations thereunder; provided, however, that the parties
expressly acknowledge and agree that in no event shall such
Acquiring Entity be deemed to accept any obligation that could
subject such Acquiring Entity, any of its Affiliates or any
employees of such Acquiring Entity or any of its Affiliates to a
Non-Compete Covenant or to any pending suit, action, litigation
or proceeding. The Selling Entities shall cause the benefits of
each Specified Contract and Litigation Contract (or the economic
equivalent thereof) to be provided to the applicable Acquiring
Entity and shall cooperate in any arrangement required to provide
such Acquiring Entity with the same, including without limitation
(i) maintenance by the Selling Entity of the Specified Contract
or Litigation Contract, as the case may be, in its name in trust
for the benefit of the Acquiring Entity or (ii) at the option of
the Acquiring Entity and at its cost, enforcement for the benefit
of such Acquiring Entity of such Specified Contract or Litigation
Contract, as the case may be against a third party.
6.5 Trade Names and Service Marks. Each Acquiring Entity
agrees that it will discontinue the use, directly or indirectly,
in any manner or form, of the name "Intergraph" and the
corresponding logo thereof; provided, however, that until the
earlier of (i) the six-month anniversary of the Principal Closing
Date and (ii) the date on which all inventory and supplies of the
Business transferred at a Closing shall be depleted, the
Acquiring Entities shall be permitted to use such name and logo
only in connection with the distribution of such inventory and
supplies; and provided further that at any time following the
Principal Closing Date, the Acquiring Entities shall be able to
identify that the Business was previously owned by the Selling
Entities.
6.6 EDS and USI Guaranty. EDS hereby guarantees to the
Selling Entities the due and punctual performance by each of the
Acquiring Entities of its respective obligations under this
Agreement and each of the Closing Agreements, provided, however,
that the obligations of EDS under this Section 6.6 shall
terminate immediately following the Principal Closing. USI
hereby guarantees to the Selling Entities the due and punctual
performance by each of the other Acquiring Entities of its
respective obligations under this Agreement and each of the
Closing Agreements.
6.7 Assistance and Cooperation. After the Principal Closing
Date, the Acquiring Entities shall, to the extent reasonably
requested by the Selling Entities, make available to the Selling
Entities and to any Tribunal all information, records and
documents relating to (i) liabilities of the Selling Entities for
Taxes relating to the Business, (ii) matters disclosed on
Schedule 3.14, (iii) such other matters as the Selling Entities
may reasonably request relating to the Retained Assets or the
performance of the Retained Liabilities. Without limiting the
generality of the foregoing, upon the request of the Selling
Entities, the Acquiring Entities shall use commercially
reasonable efforts to permit certain of the Transitioned
Employees identified by the Selling Entities to appear as
witnesses or trial representatives, and to assist the Selling
Entities in trial preparation, in connection with any litigation
or proceeding relating to the matters disclosed on Schedule 3.14;
provided, however, that the Selling Entities shall bear all
reasonable out-of-pocket expenses (but without other expense or
hourly charges) incurred by such Transitioned Employees in
providing any such requested assistance to the Selling Entities.
ARTICLE VII
CONDITIONS PRECEDENT
TO THE OBLIGATIONS OF THE ACQUIRING ENTITIES
The obligations of an Acquiring Entity under this Agreement
to acquire the Acquired Assets and to assume the Assumed
Liabilities shall be subject to the fulfillment of all of the
following conditions at or before any Closing:
7.1 Representations and Warranties. Each of the
representations and warranties made by the Selling Entities (or,
in the case of an International Closing subsequent to the
Principal Closing, the representations and warranties of the
applicable Selling Entity) set forth herein or in any Schedule,
Exhibit, instrument or other document delivered to an Acquiring
Entity pursuant to this Agreement (including without limitation
any applicable Closing Agreement) shall be true and correct in
all respects as of the date hereof and on and as of such Closing
Date, to the same extent and with the same effect as if made on
and as of such Closing Date, except where such representation
clearly relates to another date specified therein (in which case,
such representation shall relate to such specific date).
7.2 Performance by the Selling Entities. The Selling
Entities shall have fully performed and complied with all
covenants and agreements required by this Agreement and any
applicable Closing Agreement to be performed or complied with by
each of them on or before such Closing.
7.3 Prohibitions, Restrictions and Litigation. On such
Closing Date, there shall be no Official Action outstanding, and
no proceeding or other litigation shall be pending by any other
Person, against any of the applicable Acquiring Entities which
prohibits or restricts, challenges or reasonably may be expected
to give rise to a material challenge to, consummation of the
transactions contemplated by this Agreement and any applicable
Closing Agreement with respect to such Closing or which claims
(or reasonably may be expected to give rise to a claim of)
damages as a result of the consummation of the transactions
contemplated by this Agreement and any applicable Closing
Agreement or otherwise have a material adverse effect on the
Business subsequent to such Closing.
7.4 Consents. The Selling Entities participating in such
Closing shall have received the Consents referred to in Schedule
7.4 that relate to such Closing and such other material Consents
from any Tribunal or other Person as may be necessary or
appropriate (a) to consummate the transactions contemplated by
this Agreement and any applicable Closing Agreement with respect
to such Closing in accordance with this Agreement; (b) to enable
the applicable Acquiring Entities to carry on and conduct that
portion of the Business to be conveyed at such Closing subsequent
to such Closing in substantially the same manner as was carried
on and conducted prior to such Closing; or (c) that are necessary
to prevent a breach of or a material default or penalty, or
material increase in payments under, or a termination of any
material Contract relating to the Business.
7.5 Governmental Clearances. All required filings with
Tribunals shall have been made and all waiting periods, including
any extensions thereof, which may be applicable to the
transactions contemplated by this Agreement shall have expired or
terminated.
7.6 Satisfactory Proceedings. All proceedings to be taken
in connection with the consummation of the transactions
contemplated by this Agreement and any applicable Closing
Agreement, and all certificates, documents and instruments
incidental hereto and required hereby, shall be reasonably
satisfactory in form and substance to the Acquiring Entities, and
the applicable Acquiring Entities shall have received copies of
all such documents and instruments as such Acquiring Entities may
reasonably request in connection with such transactions.
7.7 Certificate of Intergraph and Certain Officers. USI
shall have received a certificate, dated the applicable Closing
Date, executed by Intergraph and, with respect to the Selling
Entities participating in each such Closing, by the Chairman of
the Board, President or any Vice President of each such Selling
Entity, to the effect that the conditions set forth in
Sections 7.1, 7.2, 7.3, 7.4 and 7.5 have been satisfied.
7.8 Waiver of Conditions. USI shall have the right and the
authority, on behalf of each and all of the Acquiring Entities,
to waive any or all of the foregoing conditions precedent to the
obligations of such Acquiring Entities; provided, however, that
no waiver by USI of any condition precedent to the obligations of
the Acquiring Entities with respect to a particular Closing shall
constitute a waiver by the Acquiring Entities of any other
condition precedent or a waiver by the Acquiring Entities with
respect to any other Closing.
7.9 New Collateral Contracts. With respect to an
International Closing, the respective Acquiring Entities and the
respective Selling Entities shall have entered into the
collateral Contracts identified in each applicable Closing
Agreement relating to such International Closing, all upon such
terms and conditions as are reasonably acceptable to the parties
thereto.
7.10 Absence of Material Adverse Change. Since the date of
this Agreement, there shall have occurred no materially adverse
change in the condition (financial or otherwise), assets (taken
as a whole), liabilities (taken as a whole), properties (taken as
a whole), business or prospects of the Business or the Acquired
Assets.
ARTICLE VIII
CONDITIONS PRECEDENT
TO THE OBLIGATIONS OF THE SELLING ENTITIES
The obligations of a Selling Entity under this Agreement to
sell the Acquired Assets shall be subject to the fulfillment of
all of the following conditions at or before any Closing:
8.1 Representations and Warranties. Each of the
representations and warranties made by the Acquiring Entities
(or, in the case of an International Closing subsequent to the
Principal Closing, the representations and warranties of the
applicable Acquiring Entity) set forth herein or in any Schedule,
Exhibit, instrument or other document delivered to a Selling
Entity pursuant to this Agreement (including without limitation
any applicable Closing Agreement) shall be true and correct in
all respects as of the date hereof and on and as of such Closing
Date, to the same extent and with the same effect as if made on
and as of such Closing Date, except where such representation
clearly relates to another date specified therein (in which case
such representation shall relate to such specified date).
8.2 Performance by the Acquiring Entities. The Acquiring
Entities shall have fully performed and complied with all
covenants and agreements required by this Agreement and any
applicable Closing Agreement to be performed or complied with by
each of them on or before such Closing Date.
8.3 Prohibitions, Restrictions and Litigation. On such
Closing Date, there shall be no Official Action outstanding, and
no proceeding or other litigation shall be pending by any other
Person, against any of the applicable Selling Entities which
prohibits or restricts, challenges or reasonably may be expected
to give rise to a material challenge to consummation of the
transactions contemplated by this Agreement and any applicable
Closing Agreement with respect to such Closing or which claims
(or reasonably may be expected to give rise to a claim of)
damages as a result of the consummation of the transactions
contemplated by this Agreement and any applicable Closing
Agreement or otherwise have a material adverse effect on
Intergraph subsequent to such Closing.
8.4 Consents. The Acquiring Entities participating in such
Closing shall have received the Consents that relate to such
Closing and such other material Consents from any Tribunal or
other Person as may be necessary or appropriate to enable the
Selling Entities participating in such Closing to consummate the
transactions contemplated by this Agreement and any applicable
Closing Agreement with respect to such Closing in accordance with
this Agreement without any conditions which Intergraph might
reasonably consider to be material and adverse to Intergraph or
its business and operations after such Closing.
8.5 Governmental Clearances. All required filings with
Tribunals shall have been made and all waiting periods, including
any extensions thereof, which may be applicable to the
transactions contemplated by this Agreement with respect to such
Closing shall have expired or terminated.
8.6 Certificate of USI and Certain Officers. Intergraph
shall have received a certificate, dated such Closing Date,
executed by USI and, with respect to the Acquiring Entities
participating in such Closing, the Chairman of the Board,
President or any Vice President of each such Acquiring Entity, to
the effect that the conditions set forth in Sections 8.1, 8.2,
8.3, 8.4 and 8.5 have been satisfied.
8.7 Waiver of Conditions. Intergraph shall have the right
and the authority on behalf of the Selling Entities participating
in such Closing, to waive any or all of the foregoing conditions
precedent to the obligations of such Selling Entities; provided,
however, that no waiver by Intergraph of any condition precedent
to the obligations of the Selling Entities with respect to a
particular Closing shall constitute a waiver by the Selling
Entities of any other condition precedent or a waiver by the
Selling Entities with respect to any other Closing.
8.8 New Collateral Contracts. With respect to an
International Closing, the respective Acquiring Entities and the
respective Selling Entities shall have entered into the
collateral Contracts identified in each applicable Closing
Agreement relating to such International Closing, all upon such
terms and conditions as are reasonably acceptable to the parties
thereto.
ARTICLE IX
INDEMNIFICATION; OFFSET
9.1 Indemnification by the Acquiring Entities. USI jointly
agrees with respect to itself and each other Acquiring Entity,
and each other Acquiring Entity agrees with respect to itself, to
indemnify and hold harmless each of the Selling Entities and
their respective directors, officers, employees, advisors,
Affiliates, agents and representatives, stockholders, successors
and assigns (the "Intergraph Indemnitees") from and against any
and all losses, damages, liabilities, claims, costs and expenses,
including without limitation Legal Expenses (collectively,
"Losses") arising out of, based upon or resulting from:
(a) any violation or breach by any of the Acquiring
Entities of, or any default by any of the Acquiring Entities
under, this Agreement or any certificate, Schedule, Exhibit
or other document or instrument furnished or to be furnished
by any of the Acquiring Entities to any of the Selling
Entities in connection with this Agreement, including,
without limitation, the Transferred Intellectual Property
License Agreements, or the consummation of the transactions
contemplated hereby or from any error, inaccuracy or
misrepresentation in any of the representations and
warranties made by, or on behalf of, any of the Acquiring
Entities herein or therein;
(b) the failure of the Acquiring Entities to pay, perform
or discharge when due any of the Assumed Liabilities and any
of its obligations with respect to Transaction Taxes, if
any, to the extent provided for in Section 10.13 hereof;
(c) any condition, event or activity relating to that
portion of the Business or those Acquired Assets transferred
and conveyed on any Closing Date and that existed or
occurred on or after the Principal Closing Date (excluding
any condition, event or activity that existed or occurred
after the Principal Closing Date as a result of any action
taken by a Selling Entity without USI's consent with respect
to a non-U.S. Selling Entity prior to the applicable
International Closing);
(d) the termination of a Foreign National Employee's
employment by Intergraph pursuant to clause (ii) of the
final sentence of Section 5.13(e) or the employee of an
International Selling Entity who would otherwise have been a
Transitioned Employee pursuant to Section 2.14(a), in each
case in accordance with terms set forth by USI in
termination request delivered by USI pursuant to either such
Section;
(e) (i) any use or exploitation by USI of the Intellectual
Property subject to the Transferred Intellectual Property
License Agreements not permitted by the terms thereof; (ii)
any amounts for which Intergraph shall indemnify a USI
Indemnitee pursuant to Section 9.2(b) hereof to the extent
that the Losses which resulted in such indemnification
obligations arose due to the failure by USI to use any
modification, enhancement or adaptation to any BAG Tool,
INGR Tool or SolidEdge Common Code provided by Intergraph to
USI, provided that USI was given notice by Intergraph of
such modification, enhancement or adaptation (along with the
reasons therefor), that USI had reasonable opportunity to
implement such modification, enhancement or adaptation, and
that Intergraph could demonstrate to USI that such
modification, enhancement or adaptation provided the same
functionality as the BAG Tool, INGR Tool or SolidEdge Common
Code that resulted in such Loss; or (iii) USI's use of any
BAG Tool or the SolidEdge Common Code in a modified form
from that delivered to USI at the Principal Closing to the
extent that the Losses of the Intergraph Indemnitees
resulted from such modification; or
(f) any suit or action at law or in equity, arbitration
proceeding, interference or opposition proceeding,
governmental or quasi-governmental proceeding, complaint or
investigation, or liability claim which arises (or is
claimed to arise) in connection with, or relates to (or is
claimed to relate to), any of the matters referred to above
in this Section 9.1.
Notwithstanding the foregoing provisions of this Section 9.1,
with respect to any Losses arising out of, based upon or
resulting from any error, inaccuracy or misrepresentation in any
of the representations and warranties contained in Article IV or
in any of the representations and warranties (but not covenants)
of any of the Acquiring Entities contained in any certificate,
document, affidavit or instrument delivered pursuant to this
Agreement (including without limitation the Closing Agreements)
(the "Intergraph Losses"), the foregoing indemnity and hold
harmless obligations of the Acquiring Entities relating to such
Intergraph Losses shall become operative and effective only if
and when all Intergraph Losses for which Intergraph Indemnitees
are entitled to receive indemnification under this Section 9.1
exceed, in the aggregate, $150,000 (it being understood and
agreed that all such Intergraph Losses shall accumulate until
such time as they exceed $150,000, at which time the Acquiring
Entities shall be obligated to indemnify any Intergraph
Indemnitees seeking indemnification under this Section 9.1 for
the aggregate amount of such Intergraph Losses, rather than the
amount that exceeds $150,000). The parties expressly acknowledge
and agree that the immediately preceding sentence shall not apply
to any Losses other than the Intergraph Losses. The parties
further agree that the liability of the Acquiring Entities
specified above with respect to the Intergraph Losses shall be
reduced to the extent of any insurance proceeds actually received
by any of the Intergraph Indemnitees for such Intergraph Losses
from any of the Acquiring Entities or any of their Affiliates or
any insurance carrier of the Acquiring Entities or any of their
affiliates.
9.2 Indemnification by the Selling Entities. Intergraph
jointly agrees with respect to itself and each other Selling
Entity, and each other Selling Entity agrees with respect to
itself, to indemnify and hold harmless each of the Acquiring
Entities and each of their respective directors, officers,
employees, advisors, Affiliates, agents, representatives,
stockholders, successors and assigns (the "USI Indemnitees") from
and against any and all Losses arising out of, based upon or
resulting from:
(a) any violation or breach by any of the Selling Entities
of, or default by any of the Selling Entities under, this
Agreement or any certificate or other document or instrument
furnished or to be furnished by any of the Selling Entities
to any of the Acquiring Entities in connection with this
Agreement, including, without limitation, the Transferred
Intellectual Property License Agreements, or the
consummation of the transactions contemplated hereby
(including without limitation the Closing Agreements) or
from any error, inaccuracy or misrepresentation in any of
the representations and warranties (other than the
representations and warranties in Sections 3.31, 3.32 and
3.33 hereof) made by, or on behalf of, any of the Selling
Entities herein or therein;
(b) any error, inaccuracy or misrepresentation in any of
the representations and warranties made by the Selling
Entities in Sections 3.31, 3.32 and 3.33 hereof, provided
that for purposes of this Article IX, the Selling Entities
shall indemnify the USI Indemnitees in respect of Sections
3.31, 3.32 and 3.33 viewing such Sections without reference
to any "knowledge of the Selling Entities" or similar
qualification set forth therein (i.e., the representation
and warranty shall be viewed as if no such knowledge or
similar qualification was set forth therein);
(c) any of the Retained Assets (including, without
limitation, any Contract included within the Retained
Assets) or any of the Retained Liabilities;
(d) any condition, event or activity relating to that
portion of the Business or those Acquired Assets transferred
and conveyed on any Closing Date and that existed or
occurred before the Principal Closing Date (regardless of
whether such condition, event or activity would have
constituted a breach of any representation or warranty
hereunder);
(e) except as set forth in Section 9.1(d), any liability or
obligation arising out of the termination of employment of
an employee of a Selling Entity;
(f) any liability or obligation which related to any
noncompliance with any bulk sales in connection with the
transactions contemplated by this Agreement;
(g) any liability or obligation with respect to the payment
of the applicable Consideration to Intergraph as agent and
on behalf of a Selling Entity;
(h) any liability or obligation with respect to any income,
franchise, sales, use or other Taxes (and Transactions
Taxes, if any, to the extent provided in Section 10.13
hereof) and with respect to any social security
contributions (including both employers' and employees'
contributions) of any Selling Entity which are attributable
periods ending prior to the Principal Closing Date;
(i) the enforcement, or the attempted enforcement, of any
Non-Compete Covenant contained in a Specified Contract
against any of the Acquiring Entities, any of their
Affiliates or any of their employees, acting in his or her
capacity as an employee of an Acquiring Entity or an
Affiliate of the same;
(j) the transfer to the Acquiring Entities of the rights
and obligations of the Selling Entities arising with respect
to periods prior to the applicable Closing Date from the
employment relationships of the Selling Entities with the
Transitioned Employees existing immediately prior to the
applicable Closing Date where, by virtue of applicable
Legislative Enactments of any Tribunal to implement EEC
Council Directive 77/187, any Transitioned Employee is not
regarded as employed in the Business;
(k) the failure to transfer to the Acquiring Entities the
rights and obligations of the Selling Entities arising from
the employment relationships of the Selling Entities with
any of their employees existing immediately prior to the
applicable Closing Date where, by virtue of applicable
Legislative Enactments of any Tribunal to implement EEC
Council Directive 77/187, any such employee is regarded as
employed in the Business (other than any such failure due to
USI's breach of its obligation to offer employment to such
persons in accordance with Section 6.3);
(l) any liability or obligation arising under an applicable
Environmental Law relating to the Compliance Group or a
Compliance Property (whether or not such liability or
obligation would constitute a breach of the representation
and warranty set forth in Section 3.15 hereof), except those
for which USI shall be specifically responsible under the
terms of the Lease Agreement as a result of actions taken by
USI following the Principal Closing Date;
(m) any liability or obligation arising out of the failure
of the Software products of the Business to be Year 2000
Compliant, regardless of whether such non-compliance
resulted in a breach of the representation and warranty set
forth in Section 3.17 hereof; or
(n) any suit or action at law or in equity, arbitration
proceeding, interference or opposition proceeding,
governmental or quasi-governmental proceeding, complaint or
investigation, or liability claim which arises in connection
with, or relates to (or is claimed to relate to), any of the
matters referred to above in this Section 9.2.
Notwithstanding the foregoing provisions of this Section 9.2,
with respect to any Losses arising out of, based upon or
resulting from any error, inaccuracy or misrepresentation in any
of the representations and warranties contained in Article III or
in any of the representations and warranties (but not covenants)
of any of the Selling Entities contained in any certificate,
document, affidavit or instrument delivered pursuant to this
Agreement (including without limitation the Closing Agreements)
(the "USI Losses"), the foregoing indemnity and hold harmless
obligations of the Selling Entities relating to such USI Losses
shall become operative and effective only if and when all USI
Losses for which USI Indemnitees are entitled to receive
indemnification under this Section 9.2 exceed, in the aggregate,
$150,000 (it being understood and agreed that all such USI Losses
shall accumulate until such time as they exceed $150,000, at
which time the Selling Entities shall be obligated to indemnify
any USI Indemnitees seeking indemnification under this Section
9.2 for the aggregate amount of the USI Losses, rather than the
amount that exceeds $150,000). The parties expressly acknowledge
and agree that the immediately preceding sentence shall not apply
to any Losses other than the USI Losses. The parties further
agree that the liability of the Selling Entities specified above
with respect to the USI Losses shall be reduced to the extent of
any insurance proceeds actually received by any of the USI
Indemnitees for such USI Losses from any of the Selling Entities
or any of their Affiliates or any insurance carrier of the
Selling Entities or any of their affiliates.
9.3 Satisfaction of Claims. If any Person entitled to
indemnification under this Article IX (an "Indemnified Party")
desires to assert any claim for indemnification or to be held
harmless under this Article IX (a "Claim"), the Indemnified Party
shall deliver to the Person that is obligated to provide such
indemnification (the "Indemnifying Party") notice of its demand
for satisfaction of such Claim (a "Request"), specifying in
reasonable detail the amount of such Claim and, to the extent
practicable under the circumstances, the basis for asserting such
Claim. Within 30 days after the Indemnifying Party has been given
a Request, the Indemnifying Party shall either (i) satisfy the
Claim requested to be satisfied in such Request by delivering to
the Indemnified Party payment by wire transfer or a certified or
bank cashier's check payable to the Indemnified Party in
immediately available Federal Reserve Funds in an amount equal to
the amount of such Claim, or (ii) notify the Indemnified Party
that the Indemnifying Party contests such Claim by (A) delivering
to the Indemnified Party an objection to such Claim, specifying
in reasonable detail, to the extent practicable under the
circumstances, the basis for contesting such Claim, and (B)
demanding arbitration of the Claim in accordance with Section
10.11. If the Indemnifying Party fails to satisfy a Claim (or
portion of a Claim) within 30 days after the Indemnifying Party
has been given a Request with respect to such Claim, and whether
or not the Indemnifying Party has contested such Claim, the
Indemnifying Party shall pay the Indemnified Party asserting such
Claim interest on the unpaid amount of such Claim (or unpaid
portion of a Claim) at the Prime Rate, computed from the date
such Request was given to the Indemnifying Party to the date such
Claim (or portion of a Claim) is satisfied; provided, however,
that the Indemnifying Party shall not be required to pay the
Indemnified Party interest on that part of any unpaid Claim (or
portion of a Claim) which the Indemnifying Party successfully
contests.
9.4 Matters Which May Give Rise to Claims.
(a) Notice and Control. Within 20 days (or such earlier
time as might be required to avoid prejudicing the Indemnifying
Party's capacity to defend) after receipt by an Indemnified Party
of notice of commencement of any action evidenced by service of
process or other legal pleading which it determines has given or
could give rise to a Claim (a "Third-Party Matter"), the
Indemnified Party shall give the Indemnifying Party written
notice thereof (together with a copy of such Claim, process or
other legal pleading). The Indemnifying Party shall assume the
defense of such Claim and in connection therewith:
(i) such Indemnifying Party shall defend such
Third-Party Matter at its own expense, in good faith
and in a manner consistent with the best interests of
the Indemnified Party;
(ii) such Indemnifying Party shall keep the
Indemnified Party fully informed as to the status of
the defense of such Third-Party Matter;
(iii) such Indemnifying Party shall employ
legal counsel, accountants and/or other experts
reasonably satisfactory to the Indemnified Party to
represent the Indemnified Party in connection with such
Third-Party Matter;
(iv) the Indemnified Party shall have the right to
observe and be present (at its own expense) at any and
all meetings, conferences and other proceedings with
respect to such Matter;
(v) the Indemnifying Party shall obtain the prior
written approval of the Indemnified Party before
entering into any settlement of such Third-Party Matter
or ceasing to defend against such Third-Party Matter,
if, pursuant to or as a result of such settlement or
cessation, injunctive or other equitable relief would
be imposed against the Indemnified Party;
(vi) without the written consent of the
Indemnified Party, the Indemnifying Party shall not
consent to the entry of any judgment or enter into any
settlement that does not include as an unconditional
term thereof the giving of a release from liability in
respect of such Third-Party Matter to each Indemnified
Party by the claimant or plaintiff; and
(vii) unless such Indemnifying Party is
successful in defending such Third-Party Matter on the
merits, any and all losses, damages, costs, and
expenses which any Indemnified Party shall suffer or
incur in connection with such Third-Party Matter shall
be conclusively deemed to be losses, damages, costs and
expenses as to which the Indemnified Party shall have
the right to be indemnified and held harmless under
this Article IX.
Neither the observation or participation by any Indemnified
Party in the defense of any Third-Party Matter, nor the failure
by any Indemnified Party to observe or participate in the defense
of any Third-Party Matter, shall affect in any way the
liabilities and obligations of the Indemnifying Party with
respect to such Third-Party Matter under this Article IX.
If the Indemnifying Party does not assume the defense of
such Third-Party Matter with legal counsel reasonably
satisfactory to the Indemnified Party within 15 days after the
Indemnifying Party has received notice of such Third-Party Matter
from the Indemnified Party, the Indemnified Party shall have the
right to undertake the defense, compromise and settlement of such
Third-Party Matter on behalf of and for the account and risk of
the Indemnifying Party.
(b) Expenses. If the Indemnified Party undertakes the
defense, compromise and settlement of such Third-Party Matter
pursuant to Section 9.4(a), the Indemnifying Party will promptly
reimburse the Indemnified Party for all reasonable fees, costs
and expenses (including without limitation any Legal Expenses)
incurred by the Indemnified Party in respect of such Third-Party
Matter. The reimbursement of such fees, costs and expenses shall
be made by periodic payments during the course of any
investigation or defense, as and when bills are received or
expenses incurred.
(c) Cooperation. The Indemnified Party and the
Indemnifying Party shall cooperate in the defense of a Third
Party Matter that is defended in accordance with this
Section 9.4, and shall make available to the defending person or
its representative all records and materials required for its use
in such defense.
ARTICLE X
GENERAL
10.1 Survival of Representations and Agreements. All
representations and warranties contained in this Agreement or in
any certificate, document, affidavit or instrument delivered
pursuant to this Agreement (including without limitation the
Closing Agreements) shall survive the Principal Closing and each
International Closing and any investigation made at any time by
or on behalf of any of the parties or any other Person and shall
continue in full force and effect:
(a) forever and without any limit upon duration in the case
of the representations and warranties set forth in Sections
3.3, 3.14, 3.15, 3.19, 3.25, 3.31, 3.32, 3.33, 3.37 and 4.3;
(b) until 60 days following the latest date on which any
statute of limitations (including any extensions thereof)
expires with respect to any taxable year or period up to and
including any taxable year or period ending on or which
includes a Closing Date, in the case of the representation
and warranty of the Selling Entities set forth in Section
3.13 hereof;
(c) in the case of a representation or warranty of the
Selling Entities set forth in Sections 3.26 and 3.29 hereof,
until 60 days following the expiration date of the statute
of limitations underlying such representation or warranty;
(d) until the expiration of the thirty-month period
following the applicable Closing Date in the case of all
other representations and warranties; and
(e) for the comparable periods of time set forth above in
this Section 10.1 in the case of each representation and
warranty (but no covenant) set forth in any certificate,
document, affidavit or instrument delivered pursuant to this
Agreement (including, without limitation, the Closing
Agreements), based upon the nature of such representation
and warranty when compared to the most analagous
representation and warranty set forth above.
10.2 Termination. This Agreement may be terminated at any
time prior to the final International Closing:
(a) by the mutual consent in writing of USI and Intergraph;
or
(b) by USI or Intergraph if any court of competent
jurisdiction in the United States or other United States
Tribunal shall have issued an Official Action or taken any
other action restraining, enjoining or otherwise prohibiting
any part of the transactions contemplated by this Agreement,
and such order, decree, ruling or other action shall have
become final.
If, for any reason whatsoever the Principal Closing shall
not have taken place on or before March 15, 1998, either party
may, by notice to the other, terminate this Agreement, whereupon
all of the rights and obligations of the Selling Entities and the
Acquiring Entities under this Agreement shall terminate without
any liability to any party or to its directors, officers,
stockholders, successors and assigns, except for the liability of
any party for any breach of this Agreement, provided that the
right to terminate this Agreement pursuant to this sentence shall
not be available to any party whose failure to perform any
material covenant or obligation under this Agreement has been the
cause of or resulted in the failure of the Principal Closing to
occur on or before such date. Unless earlier terminated in
accordance with the previous sentence, the obligations of the
Selling Entities and the Acquiring Entities to conduct any or all
International Closings shall terminate on December 31, 1998;
provided, however, that the termination of such obligation shall
not impair any rights or obligations of the Selling Entities and
the Acquiring Entities arising under Article IX prior to December
31, 1998, with respect to International Closings contemplated by
this Agreement or the transactions contemplated hereby.
10.3 HSR Filings; Other Filings. Each of Intergraph and USI
has filed with the Federal Trade Commission and the Antitrust
Division of the United States Department of Justice a
Notification and Report Form and related material required to be
filed by it under the HSR Act with respect to the transactions
contemplated hereby. The Selling Entities and the Acquiring
Entities shall cooperate and use reasonable efforts to prepare
and file as promptly as practicable after the date hereof all
requisite applications, notices and other necessary instruments
or documents in order to obtain the approvals, consents and other
authorizations referred to in Section 3.4 and agree to act with
all reasonable diligence to obtain all such approvals and
licenses.
10.4 Expenses of Transaction. Each party shall be
responsible for its own costs associated with the negotiation and
consummation of the transactions contemplated hereby, including
without limitation all legal, consulting and accounting expenses
and any fees or commissions due any broker as a consequence of
the consummation of such transactions. The filing fees incurred
in connection with the filings pursuant to the HSR Act have been
borne by USI. Each of the parties hereto is responsible for, and
shall indemnify the other against, any claim by any third party
to a fee, commission or other remuneration arising by reason of
any services alleged to have been rendered to or at the instance
of said party with respect to this Agreement or any of the
transactions contemplated hereby.
10.5 Public Disclosure. No party shall issue any press
release or otherwise make any public statement with respect to
the transactions contemplated hereby, except with the prior
written consent of the other party; provided, however, that such
consent shall not be required for any disclosure or reporting
obligations of any party, to the extent required by applicable
Legislative Enactments or other competent authority, but (as is
practicable under the circumstances) such disclosing party shall
consult with the other party in advance.
10.6 Notices. Any notices or other communications required
or permitted hereunder or under any other agreement contemplated
hereunder shall be deemed given if sent by registered or
certified mail (postage prepaid), overnight delivery via
nationally recognized courier, or facsimile transmission
(provided that in the case of courier or facsimile transmission,
a copy is also sent by registered or certified mail, postage
prepaid); in each case addressed as follows:
If to any of the Selling Entities, to:
Intergraph Corporation
Huntsville, Alabama 35894-0001
Attention: John W. Wilhoite
Facsimile No.: (205)730-2408
with a copy (which shall not constitute notice) to:
Intergraph Corporation
Huntsville, Alabama 35894-0001
Attention: General Counsel
Facsimile No.: (205)730-2247
If to any of the Acquiring Entities, to:
Unigraphics Solutions Inc.
13736 Riverport Drive
Maryland Heights, Missouri 63043
Attention: President
Facsimile No.: (314) 232-1523
With a copy (which shall not constitute notice) to:
Electronic Data Systems Corporation
5400 Legacy Drive
Plano, Texas 75024
Attention: General Counsel
Facsimile No.: (972) 605-5610
Each such Person may designate by notice to all other such
Persons a new address for its receipt of notices and other
communications. The return receipt for mail, the delivery
receipt for such a courier or the answerback for facsimile
transmission shall be conclusive evidence of such delivery.
10.7 Assignment. This Agreement shall be binding upon and
inure to the benefit of the parties and their respective
successors and permitted assigns. No Acquiring Entity may assign
any right under this Agreement or delegate any obligations
hereunder without the express prior written consent of
Intergraph, except to another Acquiring Entity or one or more
other Affiliates of EDS; provided, however, that any such
delegation of obligations hereunder to another Acquiring Entity
or to one or more Affiliates of USI shall not relieve USI of any
of its obligations under this Agreement. No Selling Entity may
assign any rights under this Agreement or delegate any
obligations hereunder without the express prior written consent
of USI, provided that USI acknowledges that Foothill Capital
Corporation, Intergraph's lender, has a lien on Intergraph's
rights under this Agreement.
10.8 Amendments; Waivers, Etc. This Agreement may not be
modified or amended except by a written instrument executed by or
on behalf of each of the parties to this Agreement. The
observance of any term of this Agreement may be waived (either
generally or in a particular instance and either retroactively or
prospectively) by the party entitled to enforce such term, but
such waiver shall be effective only if it is in writing signed by
the party against which such waiver is to be asserted. Unless
otherwise expressly provided in this Agreement, no delay or
omission on the part of any party in exercising any right or
privilege under this Agreement shall operate as a waiver thereof,
nor shall any waiver on the part of any party of any right or
privilege under this Agreement operate as a waiver of any other
right or privilege under this Agreement nor shall any single or
partial exercise of any right or privilege preclude any other or
further exercise thereof or the exercise of any other right or
privilege under this Agreement.
10.9 Governing Law. Notwithstanding the place where this
Agreement may be executed by any of the parties hereto, the
parties expressly agree that all the terms and provisions hereof
shall be governed by, and interpreted and construed in accordance
with, the substantive laws of the State of Delaware, without
giving effect to principles relating to conflict of laws.
10.10 Consent to Jurisdiction. In relation to any legal
action, suit or proceeding to which any Acquiring Entity or any
Selling Entity is a party arising out of or in connection with
this Agreement or any of the transactions contemplated by this
Agreement, after the resolution of the related dispute,
controversy or claim pursuant to the arbitration proceedings
contemplated by Section 10.11 ("Proceedings"), each of the
Acquiring Entities and each of the Selling Entities hereby
irrevocably, for itself and on behalf of its Affiliates,
(a) submits to the non-exclusive jurisdiction of the courts of
the United States of America for the Eastern District of Missouri
(such courts being herein referred to as the "Agreed Courts")
solely in respect of the interpretation and enforcement of the
provisions of this Agreement and of the documents referred to
herein, and (b) waives and agrees not to assert, as a defense in
any Proceeding for the interpretation or enforcement hereof or of
any document referred to herein, that it is not subject to the
jurisdiction of the Agreed Courts, or that such Proceeding may
not be brought or is not maintainable in the Agreed Courts, or
that this Agreement or any of such documents may not be enforced
in or by the Agreed Courts, or that its property is exempt or
immune from execution, or that the Proceeding is brought in any
inconvenient forum or that the venue of the Proceeding is
improper. Such submission to jurisdiction shall not affect any
right of any Acquiring Entity or any Selling Entity to commence
Proceedings in any other jurisdiction, and the commencement of
Proceedings in any jurisdiction shall not preclude any Acquiring
Entity or any Selling Entity from commencing Proceedings in any
other jurisdiction. Service of any and all process that may be
served on any party hereto in any Proceeding arising out of this
Agreement may be made in the manner and to the addresses set
forth in Section 10.6 and service thus made shall be taken and
held to be valid personal service upon such party by any party
hereto on whose behalf such service is made. Nothing shall
affect the right to serve any process in any other manner
permitted by law.
10.11 Arbitration.
(a) In the event of any dispute, controversy or claim of
any kind or nature arising under or in connection with this
Agreement or the other agreements contemplated hereby that
the parties are unable to resolve through informal
discussions or negotiations, the parties agree to submit
such dispute, controversy or claim to arbitration in
accordance with the following procedures:
(i) Either Intergraph or USI may demand
arbitration by giving the other party written notice to
such effect, which notice will (i) describe, in
reasonable detail, the nature of the dispute,
controversy or claim, the amount, if any, involved and
the remedy sought, and (ii) name an independent
arbitrator who is experienced in the resolution of
disputes, controversies or claims of such a nature. In
addition, such party demanding arbitration shall take
such steps as are necessary to commence arbitration
proceedings under the rules of the American Arbitration
Association (including, without limitation, the payment
of any administrative fees provided thereunder).
(ii) Within 30 days after the other party's
receipt of such demand, such other party will name a
second independent arbitrator who is experienced in the
resolution of disputes, controversies or claims of such
a nature.
(iii) The two arbitrators so named will
promptly select a third neutral arbitrator who is
experienced in the resolution of disputes,
controversies and claims of such a nature. The
arbitration will be heard by a panel of the three
arbitrators so chosen (the "Arbitration Panel") in the
United States, and the resolution of the dispute,
controversy or claim will be determined by a majority
vote of the Arbitration Panel. The Commercial
Arbitration Rules of the American Arbitration
Association will govern the conduct of the arbitration
and the selection of the arbitrators. The arbitration
proceedings shall be conducted in the English language.
(iv) The Arbitration Panel may apportion between
the parties as the Arbitration Panel may deem equitable
the fees, costs and expenses of the arbitration
incurred by the parties. The Arbitration Panel may
also award interest on any awards made by the
Arbitration Panel. In the assessment of any award of
interest, the Arbitration Panel shall consider any
delay in the satisfaction of Claims by the Indemnifying
Party.
(v) The party demanding arbitration will request
the Arbitration Panel to (i) allow for the parties to
request reasonable discovery pursuant to the rules then
in effect under the Federal Rules of Civil Procedure
for a period not to exceed 60 days prior to such
arbitration (all with the stated intent of establishing
a fair, speedy and cost-effective dispute resolution
mechanism) and (ii) require the testimony to be
transcribed. No findings of fact or opinions of law
will be required to be made by the arbitrators.
(vi) Any award rendered by the Arbitration Panel
will be final, conclusive and binding upon the parties
and any judgment thereon may be entered and enforced in
any court of competent jurisdiction.
(b) Other than actions for temporary and permanent
injunctive relief or specific performance or any action
necessary to enforce the award of the Arbitration Panel, the
provisions of this Section 10.11 will constitute the
exclusive remedy of the parties and a complete defense to
any suit, action or other proceeding instituted in any court
or before any administrative tribunal with respect to any
dispute, controversy or claim arising under or in connection
with this Agreement or the other agreements contemplated
hereby. Nothing in this Section 10.11 will prevent the
parties from exercising their rights to terminate this
Agreement in accordance with Section 10.2.
(c) Notwithstanding any other provision in this Section
10.11 to the contrary, the Arbitration Panel will not have
the authority to amend the provisions of this Section 10.11
without obtaining the prior written consent of each of the
parties to this Agreement.
10.12 Specific Performance. In addition to any other
remedy to which any party may be entitled, including arbitration
as provided in Section 10.11, the parties agree that temporary
and permanent injunctive relief and specific performance (which
specific performance may take the form of delivery of any assets
which may inadvertently have been omitted from a Schedule hereto)
may be granted, to the extent permitted under applicable law,
without proof of actual damages or inadequacy of legal remedy in
any proceeding that may be brought to enforce any of the
provisions of this Agreement; provided, however, that this
Section 10.12 shall not be deemed to abrogate the agreement of
the parties provided in Section 10.11(b).
10.13 Tax Matters.
(a) Tax Reporting for 1998. The Selling Entities will (i)
prepare and timely file with each applicable tax or revenue
service, taxing authority, or taxing tribunal (where the
operations of the Business are subject to Tax) Tax Returns
which include all income, gains, losses, deductions and
credits attributable to the operations of the Business for
the period or periods up to but not including the applicable
Closing Date and (ii) make timely payments of, and indemnify
and hold the Acquiring Entities harmless from and against,
all Taxes required to be reflected on such Tax Returns. The
Acquiring Entities will (A) prepare and timely file with
each applicable tax or revenue service, taxing authority, or
taxing tribunal (where the operations of the Businesses are
subject to Tax) Tax Returns which include all income, gains,
losses, deductions and credits attributable to the
operations of the Business for the period on or after the
applicable Closing Date and (B) make timely payments of, and
indemnify and hold the Selling Entities harmless from and
against, all Taxes required to be reflected on such Tax
Returns.
(b) Transaction Taxes.
(i) Liability, Indemnification and Payment. (A)
Intergraph (Italia) L.L.C. and Unigraphics Solutions
S.p.A. agree to equally share and pay the 3% Italian
registration tax and the cost of the third party
appraisal. (B) If, contrary to the considered judgment
of the parties' as set forth in Section 10.13(b)(ii)
below, any sales and use taxes are imposed by any
taxing authority, tax or revenue service, or tax
tribunal within the state of Alabama (the "Alabama
Sales and Use Taxes"), the party upon which such
Alabama Sales and Use Taxes are legally imposed shall
pay such sales and use taxes and any related interest,
penalty, etc. to the applicable taxing authority and
the other party shall promptly pay to, indemnify and
hold the paying party harmless from and against 50% of
such Alabama Sales and Use Taxes and any related
interest, penalty, etc. (C) The Acquiring Entities
shall pay, and indemnify and hold the Selling Entities
harmless from and against, all other Transaction Taxes
("Other Transaction Taxes"). (D) In every case where a
payment of Transaction Taxes is required to be made
directly by the indemnitee to the relevant taxing
authority, (i) the indemnifying party shall pay to the
indemnitee the amount of such Transaction Taxes which
are required to be paid by the indemnitee within thirty
(30) days of the date that the indemnitee furnishes the
indemnifying party with written notice and
documentation proving that such Transaction Taxes are
due and payable by the indemnitee to the applicable
taxing authority and (ii) such amount shall bear
interest at 18% per annum if not paid within such
thirty (30) day period. In this regard, Transaction
Taxes shall not be deemed to be due and payable by the
indemnitee during any period in which such Transaction
Taxes may legally be contested without advance payment,
unless the indemnifying party requests the indemnitee
to make payment of such Transaction Taxes.
(ii) Planning and Cooperation. Each of the Selling
Entities and each of the Acquiring Entities (A)
believe, based on their separate and independent
research, that each of the transfers provided for in
this Agreement are transfers of a business as a going
concern, if and to the extent allowable under
applicable Legislative Enactments with respect to value
added taxes ("VAT") (if this belief proves to be in
error, the Selling Entities shall invoice the Acquiring
Entities for any such VAT.), (B) believe, based on
their separate and independent research, that each of
the transfers provided for in this Agreement qualify as
transfers that are exempt from Alabama Sales and Use
Taxes, based on the casual sale and other allowable
exemptions, and (C) shall act in a manner consistent
with the foregoing. In the event that there is any
assertion or determination that VAT, Alabama Sales and
Use Tax, or Other Transaction Tax applies or may apply
in connection with any transactions under this
Agreement, or in connection with any transactions under
this Agreement as to which any type of Other
Transaction Tax does or may apply, the applicable
Selling Entities and the applicable Acquiring Entities
shall, in consultation and cooperation with each other
and on a timely basis and commercially reasonable
basis, give such notices, make such filings and
requests, adopt such reporting positions, provide such
information, and appear before such tax or revenue
service, taxing authority, or taxing tribunal as are
required, desirable, or reasonably requested by the
other party, in an effort to maintain that such
transfers are exempt or otherwise outside the scope of
VAT, the Alabama Sales and Use Tax, or Other
Transaction Taxes (as the case may be), in order to
obtain or perfect an exemption of such transactions
from VAT, the Alabama Sales and Use Tax, or Other
Transaction Taxes (as the case may be), in order to
obtain a reduction in rates for VAT applicable to such
transactions, or in order to obtain a recovery of any
VAT, Alabama Sales and Use Tax, or Other Transaction
Tax (as the case may be) paid with respect to such
transactions. Notwithstanding anything in this Section
10.13(b)(ii) to the contrary, however, no party (the
"first party") shall be required to take any action
requested by the other party (the "requesting party")
which results or could reasonably result in an increase
in the amount of Taxes or Transaction Taxes imposed
upon the first party or its Affiliates, unless the
requesting party agree to indemnify the first party and
its Affiliates for the amount of any such increase in
Taxes or Transaction Taxes. Further, no party will be
required to take any action requested by the other
party that is not based on accepted tax practice and
the legal requirements regarding the Transaction Tax
involved.
(iii) Audits, Litigation, and other Contests. (A)
Each party shall promptly provide the other party with
written notice of any claim, or of the commencement of
any audit or proceeding, together with copies of all
correspondence, notices or other documents relating
thereto, which may result in increased Transaction
Taxes. (B) In the case of Alabama Sales and Use Taxes,
both Intergraph and USI shall jointly control the
contest of such sales and use taxes, both Intergraph
and USI shall keep each other fully informed of all
proceedings relating to Alabama Sales and Use Taxes,
both Intergraph and USI shall take such steps as are
reasonably requested by the other party in order to
allow such other party to participate in any contest of
such Alabama Sales and Use Taxes, and neither
Intergraph nor USI shall be permitted to settle or
compromise the dispute of Alabama Sales and Use Taxes
without the written consent of the other party.
However, either party can pay its 50% share of any
disputed Alabama Sales and Use Taxes (and any related
interest, penalties, etc.) at any time by notifying and
paying to the other party such 50% share of disputed
Alabama Sales and Use Taxes and any related interest,
penalties, etc. that have accrued through such date of
payment. In cases where a party (the "surrendering
party") pays its 50% share of disputed Alabama Sales
and Use Taxes in accordance with the preceding
sentence, the surrendering party shall provide the
other party (the "continuing party") with powers of
attorney or other appropriate documents which will
enable the continuing party to fully control and
continue the dispute, shall not take any actions or
disclose any information that would adversely affect
the continuing party's conduct or resolution of the
dispute, and shall be released of any further liability
with respect to, and shall not share in any favorable
resolution of, the disputed Alabama Sales and Use
Taxes. (C) The Acquiring Entities shall, in their sole
discretion, control and direct the conduct of any audit
or inquiry or any administrative or judicial appeal or
other proceeding regarding Other Transaction Taxes,
each Selling Entity shall provide any Acquiring Entity
who so requests with powers of attorney or other
appropriate documents which will enable the Acquiring
Entity to conduct any such proceeding, and each Selling
Entity agrees to furnish the Acquiring Entities with
such information and documentation as is reasonably
requested by the Acquiring Entities in connection with
such proceedings. The Acquiring Entity may, in its
sole discretion, agree to pay, settle, compromise, or
concede any contest or claim relating to Other
Transaction Taxes.
(iv) Record Retention. Each party will retain all Tax
Returns, schedules, material records, workpapers or
other documents relating to Transaction Taxes until the
expiration of the statute of limitations (including
extensions) for assessing or collecting such
Transactions Taxes. Before any tax records or
documents are destroyed, the party holding such records
shall notify the other party of its intent to destroy
them and shall offer any such records to the other
party. If the other party wishes to receive such
records, it shall notify the party holding the records
or documents within 45 days of receipt of notice of the
other party's intent to destroy, and will be liable for
any costs related to the transfer of such records.
10.14 Number and Gender. Unless the context otherwise
requires, the singular and plural forms in this Agreement shall
be mutually inclusive, and the masculine, feminine and neuter
forms in this Agreement shall be mutually inclusive.
10.15 Section Headings, Schedules, Etc. The cover page
and table of contents preceding this Agreement and the headings
of the various sections of this Agreement and the Schedules
hereof and Exhibits hereto are for convenience of reference only
and do not, and shall not be deemed to, modify, define, expand or
limit any of the terms or provisions hereof. Any item referenced
in a Schedule hereto is deemed to be disclosed only with respect
to the specific Section number of this Agreement which is
explicitly referenced in the Schedule. Any item referenced in a
Schedule hereto is deemed to be disclosed only with respect to
the specific country corresponding to such Schedule. The absence
of any Schedule hereto, the purpose of which is set forth
exceptions or other qualifications to the representations and
warranties hereunder, shall be deemed to state that no such
exceptions or qualifications exist.
10.16 Complete Agreement; Counterparts. This document
and the documents (including Exhibits and Schedules) referred to
herein, contain the complete agreement and understanding of the
parties hereto and thereto with respect to the matters covered
hereby and thereby, and they rescind and supersede any prior
agreements and understandings which may have in any way related
to the subject matter hereof and thereof, including without
limitation those matters set forth in those certain letters,
dated October 10, 1997, November 4, 1997 and January 28, 1998,
from EDS to Intergraph specifically therein agreed to be binding
upon EDS and Intergraph. The express terms hereof control and
supersede any course of performance or usage of the trade
inconsistent with any of the terms hereof. This Agreement may be
executed by the parties hereto in several counterparts, and, when
so executed and delivered, shall be an original as against any
party whose signature appears thereon, but all such counterparts
shall together constitute but one and the same instrument. Each
counterpart may consist of a number of copies hereof each
executed by less than all, but together executed by all, of the
parties hereto. This Agreement shall become binding when one or
more counterparts hereof, individually or taken together, shall
bear the signatures of all of the parties reflected hereon as the
signatories. It shall not be necessary in making proof of this
Agreement to produce or account for more than one such
counterpart. Notwithstanding anything to the contrary contained
in this Agreement, it is the explicit intention of the parties
hereto that no party is making any representation or warranty
whatsoever, express or implied, beyond those expressly given in
Articles III and IV hereof and those expressly set forth in any
of the Exhibits hereto, including, but not limited to, any
implied warranty or representation as to condition,
merchantability, fitness for any particular purpose, or
suitability of the Acquired Assets.
10.17 Severability. If any provision of this Agreement
or the application of any such provision to any Person or
circumstance, shall be declared judicially to be invalid,
unenforceable or void, such decision shall not have the effect of
invalidating or voiding the remainder of this Agreement, it being
the intent and agreement of the parties that this Agreement shall
be deemed amended by modifying such provision to the extent
necessary to render it valid, legal and enforceable while
preserving its intent or, if such modification is not possible,
by substituting therefor another provision that is legal and
enforceable and that achieves the same objective.
10.18 No Third Party Beneficiaries. Nothing in this
Agreement is intended or shall be construed to give any Person,
other than the parties hereto, any legal or equitable right,
remedy or claim under or in respect of this Agreement or any
provision contained herein.
10.19 Inconsistencies. The provisions of the Closing
Agreements supplement the provisions of this Agreement; provided,
however, that to the extent that the provisions of any Closing
Agreement are in any respect inconsistent with the provisions of
this Agreement, the provisions of this Agreement shall govern and
control; provided further that to the extent that the application
of Section 10.9 to any instrument of transfer, conveyance and
assignment delivered pursuant to a Closing Agreement would render
the transfer, conveyance or assignment contemplated thereby
ineffective or invalid, any governing law provisions otherwise
specified in such instrument of transfer, conveyance and
assignment shall govern and control.
IN WITNESS WHEREOF, the parties hereto have each caused this
Agreement to be duly executed by their respective duly authorized
officers or representatives, all as of the day and year first
above written.
THIS CONTRACT CONTAINS A BINDING ARBITRATION PROVISION WHICH MAY
BE ENFORCED BY THE PARTIES.
INTERGRAPH CORPORATION
By: /s/ John W. Wilhoite
--------------------
John W. Wilhoite, Vice President
INTERGRAPH GMBH (OSTERREICH)
INTERGRAPH BENELUX BV
INTERGRAPH CANADA LTD.
INTERGRAPH CR S.R.O.
INTERGRAPH CAD/CAM (DANMARK) A/S
INTERGRAPH FINLAND OY
INTERGRAPH FRANCE SA
INTERGRAPH (DEUTSCHLAND) GMBH
INTERGRAPH (ITALIA) L.L.C.
INTERGRAPH JAPAN K.K.
INTERGRAPH KOREA LTD.
INTERGRAPH DE MEXICO, S.A. DE C.V.
INTERGRAPH EUROPEAN MANUFACTURING L.L.C.
INTERGRAPH NORGE AS
INTERGRAPH EUROPE(POLSKA)SP.Z.O.O.
INTERGRAPH SYSTEMS PTE. LTD.
INTERGRAPH (PORTUGAL) SISTEMAS DE COMPUTACAO
GRAFICA S.A.
INTERGRAPH ESPANA, S.A.
INTERGRAPH (SVERIGE) AB
INTERGRAPH (SWITZERLAND) AG
INTERGRAPH (UK) LTD.
By: /s/ John W. Wilhoite
--------------------
John W. Wilhoite, as attorney in fact
UNIGRAPHICS SOLUTIONS INC.
By: /s/ H. Timothy Hatfield
-----------------------
H. Timothy Hatfield, Vice President
UNIGRAPHICS SOLUTIONS
HANDELSGESELLSCHAFT M.B.H.
UNIGRAPHICS SOLUTIONS N.V.
UNIGRAPHICS SOLUTIONS CANADA LTD.
UNIGRAPHICS SOLUTIONS DANMARK A/S
UNIGRAPHICS SOLUTIONS FRANCE SAS
UNIGRAPHICS SOLUTIONS GMBH
UNIGRAPHICS SOLUTIONS S.P.A.
UNIGRAPHICS SOLUTIONS JAPAN LTD.
UNIGRAPHICS SOLUTIONS DE MEXICO, S.A. DE C.V.
UNIGRAPHICS SOLUTIONS B.V.
UNIGRAPHICS SOLUTIONS NORGE AS
UNIGRAPHICS SOLUTIONS PTE. LIMITED
UNIGRAPHICS SOLUTIONS ESPANA, S.A.
UG SOLUTIONS AB
UNIGRAPHICS SOLUTIONS AG
UNIGRAPHICS SOLUTIONS LTD.
By: /s/ H. Timothy Hatfield
------------------------
H. Timothy Hatfield, as attorney in fact
The undersigned is executing this Agreement to acknowledge its obligations
under Section 6.6.
ELECTRONIC DATA SYSTEMS CORPORATION
By: /s/ D. Gilbert Friedlander
--------------------------
D. Gilbert Friedlander, Senior Vice President
POWER OF ATTORNEY
The undersigned, [Intergraph SUB] (the "Company"), hereby
irrevocably makes, constitutes and appoints_____________________,
_________________________________________ and each of them,
its true and lawful attorneys-in-fact and agents, with full power
of substitution, for it and in its name, place and stead, to
make, execute, swear to, sign, acknowledge, verify, deliver,
file, record and publish any and all agreements, documents,
certificates or other instruments relating to the sale by
Intergraph Corporation, a Delaware, United States corporation
("Intergraph"), and the Company of the assets, business and
properties comprising the mechanical CAD/CAM business of
Intergraph, the Company and other subsidiaries of Intergraph
pursuant to the Asset Purchase Agreement to be entered into by
and among Intergraph, the other Selling Entities identified
therein, Unigraphics Solutions Inc., a Delaware, United States
corporation, and the other Acquiring Entities identified therein,
including but not limited to, such consents and agreements as
either or both of said attorneys-in-fact shall deem necessary or
advisable, granting unto each said attorney-in-fact and agent
full power and authority to do and perform each and every act and
thing requisite and necessary to be done in and about the
premises, as fully to all intents and purposes as it might or
could do itself, hereby ratifying and confirming all that either
of said attorneys-in-fact and agents of their designee or
designees may lawfully do or cause to be done by virtue hereof.
[INTERGRAPH SUB]
Date: , 1998 By:
-------- ----------------------
Name:
--------------------
Title:
-------------------
(USE APPROPRIATE FORM OF ACKNOWLEDGEMENT)
POWER OF ATTORNEY
By this Power of Attorney made this _____________,
1998_____________________, a company incorporated under the laws
of ___________, and having its registered address at
_____________________________, (hereinafter referred to as "the
Company")
HEREBY APPOINTS each of
Gary J. Fernandes, of Dallas, Texas, United States of America,
Gary B. Moore, of Dallas, Texas, United States of America,
John J. Mazzola, of St. Louis, Missouri, United States of America,
D. Gilbert Friedlander, of Dallas, Texas, United States of America,
H. Timothy Hatfield, of Plano, Texas, United States of America, and
David B. Hollander, of Dallas, Texas, United States of America,
each acting individually, as its true and lawful attorney
("Attorney"), in our name or on our behalf, to negotiate,
undertake, agree and complete all matters in connection with the
sale by Intergraph Corporation, a Delaware, United States
corporation (hereinafter referred to as "Intergraph") and the
other Selling Entities, to Unigraphics Solutions Inc., a
Delaware, United States corporation (hereinafter referred to as
"USI"), and the other Acquiring Entities (including the Company)
pursuant to the Asset Purchase Agreement (the "Asset Purchase
Agreement") to be entered into by and among Intergraph and the
other Selling Entities to be specified therein and USI and the
other Acquiring Entities specified therein of the Acquired Assets
(as such term is defined in the Asset Purchase Agreement) and any
or all assets and liabilities in connection therewith in the same
manner and as fully and effectually in all respects as we could
have done if personally present; and in particular, but without
prejudice to the foregoing, to execute in our name and on our
behalf (with all such amendments thereto as such Attorney shall
deem necessary or desirable):
(a) the Asset Purchase Agreement relating to the sale
and purchase;
(b) all documents or actions contemplated in
connection with the Asset Purchase Agreement;
and to execute all such other documents and do all such other
acts, deeds, matters or things which such Attorney may deem
necessary or desirable in connection therewith.
AND HEREBY AUTHORIZES:
USI to act as the paying agent for and on behalf of the Company.
AND HEREBY AUTHORIZES:
Gary J. Fernandes, Gary B. Moore, John J. Mazzola, D. Gilbert
Friedlander, H. Timothy Hatfield, and David B. Hollander, acting
individually on behalf of USI designated by the Company as the
paying agent, to take all actions and required measures relative
to the payment.
AND WE, the said Company, HEREBY DECLARE that all and every one
of the documents, deeds, matters and things which shall be by our
Attorney given, made, executed or done for the aforesaid purposes
shall be as good, valid and effectual to all intents and purposes
whatsoever as if the same had been signed, sealed, delivered,
made or given by us in our own proper person and we hereby
undertake at all times to ratify whatsoever our said Attorney
shall lawfully do or cause to be done by virtue of this Power of
Attorney.
Signed in the city of on
____________________, 1998.
By:
____________________________
GENERAL BILL OF SALE
THIS GENERAL BILL OF SALE (the "Bill of Sale"), dated
as of March 2, 1998, is made by Intergraph Corporation, a
Delaware corporation (the "Designated Selling Entity"), to
Unigraphics Solutions Inc., a Delaware corporation (the
"Designated Acquiring Entity").
W I T N E S S E T H:
WHEREAS, pursuant to that certain Asset Purchase
Agreement, dated as of March 2, 1998 (the "Asset Purchase
Agreement"), by and among Intergraph Corporation and the other
Selling Entities specified therein and Unigraphics Solutions Inc.
and the other Acquiring Entities specified therein, the Selling
Entities have agreed to sell, assign and transfer to the
Acquiring Entities the Acquired Assets and, for the consideration
specified therein, the Acquiring Entities have agreed to acquire
and accept the Acquired Assets from the Selling Entities, free
and clear of all Liens;
WHEREAS, the Designated Selling Entity is one of the
Selling Entities specified in the Asset Purchase Agreement and
the Designated Acquiring Entity is one of the Acquiring Entities
specified in the Asset Purchase Agreement;
WHEREAS, the Designated Selling Entity desires to
deliver to the Designated Acquiring Entity such further
instruments of sale, assignment and transfer as are required
effectively to vest in the Designated Acquiring Entity all right,
title and interest in and to the Acquired Assets to be conveyed
pursuant hereto;
WHEREAS, all capitalized terms not otherwise defined
herein shall have the meaning ascribed thereto in the Asset
Purchase Agreement;
NOW, THEREFORE, in consideration of the premises, the
purchase price specified in the Asset Purchase Agreement, the
assumption of the Assumed Liabilities pursuant to the Asset
Purchase Agreement and other good and valuable consideration, the
receipt and sufficiency of which are hereby acknowledged, the
Designated Selling Entity does hereby sell, assign, transfer, and
set over unto the Designated Acquiring Entity all of the Acquired
Assets of the Designated Selling Entity (the "Designated Acquired
Assets") free and clear of all Liens of any kind or character;
TO HAVE AND TO HOLD the Designated Acquired Assets,
with all of the appurtenances thereto, unto the Designated
Acquiring Entity and its successors and assigns for its and their
use, it being understood that the Designated Selling Entity does
hereby bind itself and its successors to warrant and defend the
same unto the Designated Acquiring Entity and its successors and
assigns against any Person whomsoever claiming the same, or any
part thereof or interest therein;
THE DESIGNATED SELLING ENTITY FURTHER COVENANTS AND
AGREES AS FOLLOWS:
A. The Designated Selling Entity hereby irrevocably
constitutes and appoints the Designated Acquiring Entity and the
Designated Acquiring Entity's successors and assigns as such
Designated Selling Entity's true and lawful attorney-in-fact,
with full power of substitution and resubstitution, in the name
of the Designated Acquiring Entity or in the name, place and
stead of the Designated Selling Entity and its successors but on
behalf of and for the benefit of the Designated Acquiring Entity
and its successors and assigns, to exercise any of the following
powers: (a) from time to time to demand and receive any and all
of the Designated Acquired Assets; (b) to give any receipts,
releases and acquittances for or in respect of the same or any
part of the Designated Acquired Assets; (c) from time to time to
institute and prosecute in the name of the Designated Selling
Entity or otherwise any and all actions, suits and proceedings in
respect of the Designated Acquired Assets; (d) to assert or
enforce any claim, title or right relating to the Designated
Acquired Assets; (e) to defend and compromise any and all
actions, suits or proceedings in respect of any of the Designated
Acquired Assets; and (f) to do such other things as are necessary
or appropriate in connection with any of the foregoing powers.
The powers granted hereunder are hereby acknowledged to be
coupled with an interest and shall not be revocable or otherwise
affected by the insolvency, bankruptcy, dissolution or winding up
of the Designated Selling Entity, by operation of law or
otherwise or by the occurrence of any event.
B. The Designated Selling Entity hereby agrees that it
and its successors shall, whenever and as often as requested to
do so by the Designated Acquiring Entity or its successors or
assigns, (a) execute, deliver, acknowledge, file and record, or
cause to be executed, delivered, acknowledged, filed and
recorded, any and all such further bills of sale, deeds, general
conveyances, endorsements, assignments, confirmations and other
good and sufficient instruments of sale, conveyance, assignment,
transfer and delivery and any and all such powers of attorney,
approvals, consents and other instruments of further assurance as
the Designated Acquiring Entity or its successors or assigns deem
necessary or appropriate in its or their reasonable judgment in
order to complete, ensure and perfect the sale, conveyance,
assignment, transfer and delivery of all right, title and
interest in and to any of the Designated Acquired Assets and (b)
take, or cause to be taken, any and all such actions and do, or
cause to be done, any and all such things as the Designated
Acquiring Entity and its successors or assigns shall deem
necessary or appropriate in its or their reasonable judgment in
order to put the Acquiring Entity and its successors or assigns
in actual possession and operating control of any and all of the
Designated Acquired Assets.
C. This Bill of Sale is made pursuant to the Asset
Purchase Agreement, and all representations and warranties of the
Selling Entities contained in the Asset Purchase Agreement are
hereby incorporated by reference herein as if made as of the date
hereof.
D. The Designated Acquired Assets are located as set
forth on Schedule I hereto.
IN WITNESS WHEREOF, the Designated Selling Entity has
caused this Bill of Sale to be duly executed as of the date first
above written.
INTERGRAPH CORPORATION
By:/s/ John W. Wilhoite
--------------------
John W. Wilhoite, Vice President
UNDERTAKING AND ASSUMPTION AGREEMENT
THIS UNDERTAKING AND ASSUMPTION AGREEMENT, dated as of March
2, 1998, is made by Unigraphics Solutions Inc., a Delaware
corporation (the "Designated Acquiring Entity"), to Intergraph
Corporation, a Delaware corporation (the "Designated Selling
Entity").
W I T N E S S E T H:
WHEREAS, pursuant to that certain Asset Purchase Agreement,
dated as of March 2, 1998 (the "Asset Purchase Agreement"), by
and among Intergraph Corporation and the other Selling Entities
specified therein and Unigraphics Solutions Inc. and the other
Acquiring Entities specified therein, the Designated Selling
Entity is concurrently herewith selling, assigning and
transferring to the Designated Acquiring Entity the Acquired
Assets (as defined in the Asset Purchase Agreement) of the
Designated Selling Entity comprising the Business (as defined in
the Asset Purchase Agreement);
WHEREAS, in partial consideration for such sale, conveyance,
assignment, transfer and delivery of the Acquired Assets, the
Asset Purchase Agreement requires the Designated Acquiring Entity
to assume, pay, perform and discharge certain specified
obligations of the Designated Selling Entity; and
WHEREAS, all capitalized terms not otherwise defined herein
shall have the meaning ascribed thereto in the Asset Purchase
Agreement;
NOW, THEREFORE, pursuant to the terms and subject to the
conditions of the Asset Purchase Agreement and for good and
valuable consideration, the Designated Acquiring Entity hereby
agrees to assume, pay, perform and discharge in accordance with
the terms thereof the Assumed Liabilities of the Designated
Selling Entity.
IN WITNESS WHEREOF, the Designated Acquiring Entity has
caused this Undertaking and Assumption Agreement to be duly
executed as of the date first above set forth.
UNIGRAPHICS SOLUTIONS INC.
By: /s/ H. Timothy Hatfield
------------------------
H. Timothy Hatfield, Vice President
[FORM OF]
GENERAL ASSIGNMENT,
CONVEYANCE AND ASSUMPTION AGREEMENT
THIS GENERAL ASSIGNMENT, CONVEYANCE AND ASSUMPTION AGREEMENT
("this Agreement") is being entered into effective as of _______,
1998, by and between [local Selling Entity], a _________
("Selling Entity"), and [local Acquiring Entity], a ____________
("Acquiring Entity"). All capitalized terms used but not defined
herein shall have the meanings set forth in the Asset Purchase
Agreement dated as of _____________, 1998 (the "Asset Purchase
Agreement"), by and among Intergraph Corporation, a Delaware
corporation ("Intergraph"), and the other Selling Entities (as
defined therein), and Unigraphics Solutions Inc., a Delaware
corporation ("USI"), and the other Acquiring Entities (as defined
therein). This Agreement, including the schedules, exhibits and
other attachments hereto, shall serve as the Closing Agreement
required by Section 2.6 of the Asset Purchase Agreement.
1. Pursuant to the terms of the Asset Purchase Agreement
and the Bill of Sale, a form of which is attached hereto as
Exhibit A, Selling Entity, shall, at the time of Closing, assign,
transfer and contribute to Acquiring Entity, all right, title and
interest of Selling Entity in the Acquired Assets.
2. In consideration of the sale, conveyance, assignment,
transfer and delivery of the Acquired Assets by Selling Entity to
Acquiring Entity, Acquiring Entity (a) shall pay to Selling
Entity cash in the amount of $________ ("Consideration") and (b)
hereby assumes and agrees to pay, discharge or perform, as
appropriate, only the Assumed Liabilities, exclusive of any of
the Retained Liabilities, of Selling Entity.
3. Neither Acquiring Entity nor USI assumes or agrees to
pay, perform, discharge or be responsible for the Retained
Liabilities of Selling Entity, and the Retained Liabilities shall
remain the sole responsibility and obligation of Selling Entity.
4. Selling Entity hereby appoints Acquiring Entity and its
designees, the true and lawful attorneys of Selling Entity with
full power of substitution, in the name of Selling Entity or
otherwise, and on behalf and for the benefit of Acquiring Entity
or its designees,
a. to demand and receive from time to time any and all of
the Acquired Assets;
b. to give receipts, releases, and acquittances for or in
respect of the Acquired Assets or any part thereof;
c. to collect, for the account of Acquiring Entity or its
designees, all amounts payable in respect of Customer
Contracts and other similar items included among the
Acquired Assets, and to endorse any checks received on
account of any such receivables or other items; and
d. to institute and prosecute in the name of Selling
Entity or otherwise any and all proceedings that
Acquiring Entity may deem proper to collect, assert, or
enforce any claim, right, title, debt, or account
included among the Acquired Assets.
Selling Entity agrees and acknowledges that the foregoing powers
are coupled with an interest and shall not be revocable by them
in any manner or for any reason, except as expressly contemplated
by the Asset Purchase Agreement. Selling Entity will promptly
segregate from its other funds and hold in trust for, and
transfer and deliver to, Acquiring Entity any cash or other
property that Selling Entity may receive in respect of any
claims, contracts, rights, leases, commitments, payments,
purchase orders, receivables of any character, or any other
items, included among the Acquired Assets.
5. If at any time after this Closing, Acquiring Entity
shall consider or be advised that any further assignments,
conveyances, transfers or assurances in law, or any other actions
or things, may be necessary or appropriate to assign, convey,
transfer, set over or deliver to, or to vest, perfect or confirm
in, Acquiring Entity any right, title or interest of Selling
Entity, of record or otherwise, in or to the Acquired Assets or
the Business or to place Acquiring Entity in operating control of
any of the Acquired Assets, Selling Entity, at its sole cost and
expense, shall promptly execute, deliver and record, or cause to
be executed, delivered and recorded, any and all such further
instruments of assignment, conveyance and transfer and take, or
cause to be taken, all actions and do, or cause to be done, all
things, as may be reasonably requested by Acquiring Entity to
assign, convey, transfer, set over and deliver to, and to vest,
perfect and confirm in, Acquiring Entity all right, title and
interest of Selling Entity, of record and otherwise, in and to
the Acquired Assets and the Business or to place Acquiring Entity
in operating control of any of the Acquired Assets; provided,
however, that any such request shall be subject to any
limitations or restrictions contained in the Asset Purchase
Agreement.
6. In the event that the conveyance, assignment, transfer
or delivery of any claim, contract, license, lease, sales order,
purchase order, commitment, consent, franchise, privilege or
other asset, claim, right or benefit to be assigned to Acquiring
Entity or its designees hereunder (collectively, the "Rights")
would be ineffective without the consent of a third party or any
other Person or would affect the rights of Selling Entity or any
of its respective Affiliates or of Acquiring Entity or any
designee of Acquiring Entity so that Acquiring Entity and its
designees would not receive all the Rights, Selling Entity shall
cause the benefits of the Rights (or the economic equivalent
thereof) to be provided to Acquiring Entity and its designees and
shall cooperate with Acquiring Entity and its designees in any
arrangement required to provide Acquiring Entity and its
designees with the benefits of all such Rights, including,
without limitation, (i) maintenance by Selling Entity of a Right
in its name in trust for the benefit of Acquiring Entity or its
designee or (ii) at the sole option of Acquiring Entity,
enforcement for the benefit of Acquiring Entity and its designees
of any and all such Rights against a third party. The provisions
of this Section 6 shall not apply to Customer Contracts which
shall be governed by Section 2.11(b) of the Asset Purchase
Agreement, in which case Selling Entity shall use reasonable
efforts to obtain any necessary consents.
7. All of the representations, warranties, covenants and
agreements of or relating to Selling Entity or Acquiring Entity
contained in the Asset Purchase Agreement and relating to the
Acquired Assets transferred and conveyed by this instrument are
incorporated herein by reference.
a. Each of the representations and warranties made by
Selling Entity and Acquiring Entity set forth in the
Asset Purchase Agreement or in any Schedule, Exhibit,
instrument or other document delivered to either
Selling Entity or Acquiring Entity pursuant to the
Asset Purchase Agreement (including without limitation
this Agreement) is true and correct in all respects as
of the date hereof, except where such representation
clearly relates to another date specified therein (in
which case, such representation shall relate to such
specific date).
b. Each of Selling Entity and Acquiring Entity has fully
performed and complied with all covenants and
agreements, including without limitation any covenants
and agreements relating to Transitioned Employees,
required by the Asset Purchase Agreement and this
Agreement to be performed or complied with by them on
or before this Closing.
8. At the Closing related to this Agreement, Acquiring
Entity and USI, as applicable, shall deliver or cause to be
delivered to Selling Entity the items listed on Exhibit B.
9. At the Closing related to this Agreement, Selling
Entity and Intergraph, as applicable, shall deliver or cause to
be delivered to Acquiring Entity the items listed on Exhibit C.
10. This General Assignment, Conveyance and Assumption
Agreement shall be binding upon, and shall inure to the benefit
of Selling Entity and Acquiring Entity and their respective
successors and permitted assigns. Acquiring Entity may not
assign any right under the Asset Purchase Agreement or delegate
any obligations thereunder without the express prior written
consent of Intergraph, except to another Acquiring Entity or one
or more other Affiliates of Electronic Data Systems Corporation;
provided, however, that any such delegation of obligations
thereunder to another Acquiring Entity or to one or more
Affiliates of USI shall not relieve USI of any of its obligations
under the Asset Purchase Agreement. Selling Entity may not
assign any rights under the Asset Purchase Agreement or delegate
any obligations thereunder without the express prior written
consent of USI, provided that USI acknowledges that Foothill
Capital Corp., Intergraph's lender, has a lien on Intergraph's
rights under the Asset Purchase Agreement.
11. In the event of any conflict between the terms of this
Agreement and the Asset Purchase Agreement, the terms of the
Asset Purchase Agreement shall govern and control.
IN WITNESS WHEREOF, the parties hereto have executed
this Agreement on the ___ day of ____________, 1998.
[LOCAL SELLING ENTITY]
By
Name:
Title:
[LOCAL ACQUIRING ENTITY]
By
Name:
Title:
EXHIBIT A
[FORM OF]
BILL OF SALE
1. FOR GOOD AND VALUABLE CONSIDERATION, the receipt and
legal sufficiency of which is hereby acknowledged, and pursuant
to the terms of the Asset Purchase Agreement dated as of
___________, 1998 (the "Asset Purchase Agreement"), by and among
Intergraph Corporation, a Delaware corporation ("Intergraph"),
and the other Selling Entities (as defined therein), and
Unigraphics Solutions Inc., a Delaware corporation ("USI"), and
the other Acquiring Entities (as defined therein), [local Selling
Entity], a _________ and an indirect wholly owned subsidiary of
Intergraph Corporation ("Selling Entity), hereby assigns,
transfers and contributes to [local Acquiring Entity], a
___________ and [an indirect] wholly-owned subsidiary of USI
("Acquiring Entity"), as provided herein all right, title and
interest of Selling Entity in all Acquired Assets, except for
Retained Assets. All capitalized terms used but not defined
herein shall have the meanings set forth in the Asset Purchase
Agreement.
The Acquired Assets shall include, without limitation, all
of the assets listed on Schedule I attached hereto, and the
Retained Assets shall include, without limitation, all of the
assets listed on Schedule II attached hereto.
TO HAVE AND TO HOLD the Acquired Assets unto Acquiring
Entity, its successors and assigns, forever.
2. All of the representations, warranties, covenants and
agreements of Selling Entity contained in the Asset Purchase
Agreement and relating to the Acquired Assets transferred and
conveyed by this instrument are incorporated herein by reference.
3. This Bill of Sale shall be binding upon, and shall
inure to the benefit of Selling Entity and Acquiring Entity and
their respective successors and assigns.
IN WITNESS WHEREOF, the parties hereto have executed this
Bill of Sale on the ___ day of ____________, 1998.
[Local Selling Entity]
By
Name:
Title:
EXHIBIT B
CLOSING DELIVERIES BY ACQUIRING ENTITY
At the Closing, Acquiring Entity shall deliver to Selling
Entity the following:
1. the Consideration (subject to the withholding and
payments into escrow pursuant to the terms of the Escrow
Agreement);
2. a copy of the resolutions of the Boards of Directors of
each of Acquiring Entity, USI and EDS authorizing the
execution, delivery and performance by Acquiring Entity of
this Agreement and by EDS and USI of the other agreements
contemplated hereby to which such Person is a party, and the
consummation of the transactions contemplated hereby and
thereby, certified as of the Closing Date by the Secretary
or Assistant Secretary (or other appropriate, authorized
officer) of Acquiring Entity, USI and EDS, respectively;
3. duly executed certificates of the Secretary or
Assistant Secretary of each of Acquiring Entity, EDS and
USI, certifying as of the Closing Date as to the incumbency
and signature of the officers of such corporations who have
executed this Agreement and the documents delivered at such
Closing on behalf of such corporation;
4. this Agreement, duly executed by Acquiring Entity.
EXHIBIT C
CLOSING DELIVERIES BY SELLING ENTITY
At the Closing, Selling Entity shall deliver to Acquiring Entity
the following:
1. any amounts payable to Acquiring Entity in respect of the
interim operation of the Business pursuant to Section 5.14
of the Asset Purchase Agreement;
2. a copy of the Charter (as in effect on the Closing
Date) of Selling Entity certified, within the five-day
period preceding the Closing Date (or, if such certification
is not obtainable in Selling Entity's jurisdiction within
such period, a certified copy as of the nearest practicable
date to the Closing Date), by the Secretary of State (or
other appropriate, authorized official) of the respective
State or other jurisdiction of its incorporation or
organization;
3. a copy of the Bylaws (as in effect on the Closing Date)
of Selling Entity, certified as of the Closing Date by the
Secretary or Assistant Secretary (or other appropriate,
authorized officer) of Selling Entity;
4. a copy of all resolutions adopted by the Board of
Directors or other governing body of Selling Entity
(together with a copy of all resolutions adopted by the
shareholders of Selling Entity where legally required),
authorizing the execution, delivery and performance by
Selling Entity of this Agreement and the other agreements
contemplated hereby and by the Asset Purchase Agreement to
which Selling Entity is a party (and any applicable Power of
Attorney granted in connection therewith), and the
consummation of the transactions contemplated hereby and
thereby, certified as of the Closing Date by the Secretary
or Assistant Secretary (or other appropriate officer) of
Selling Entity;
5. appropriate evidence of any and all Consents necessary
to effectuate the transactions contemplated by the Asset
Purchase Agreement relating to this Closing;
6. certificates of existence and, to the extent available
in the appropriate jurisdiction, good standing (including
evidence of payment of any franchise Taxes), and bring down
telegrams or telexes if issued in such jurisdiction, dated,
to the extent practicable, within the five-day period
preceding the Closing Date with respect to Selling Entity,
from the appropriate Tribunals in Selling Entity's
jurisdiction of incorporation or other organization;
7. duly executed certificates of the Secretary or
Assistant Secretary (or other appropriate, authorized
officer) of Selling Entity, certifying as of the Closing
Date as to the incumbency and signature of the officers of
Selling Entity who have executed this Agreement and the
documents delivered at such Closing on behalf of such Person
(or any applicable Power of Attorney granted in connection
therewith);
8. a duly executed legal opinion of Selling Entity's
corporate counsel as to the matters set forth on Exhibit N
of the Asset Purchase Agreement, as they relate to Selling
Entity and the assets and interests conveyed hereby;
9. the General Assignment, Conveyance and Assumption
Agreement and the Bill of Sale, each duly executed by
Selling Entity, dated the Closing Date;
10. [to the extent applicable to Selling Entity, a
Copyright Assignment in the form attached to the Asset
Purchase Agreement as Exhibit O-1 and a Trademark Assignment
in the form attached to the Asset Purchase Agreement as
Exhibit O-2, each duly executed by Selling Entity and dated
the Closing Date];
11. copies of any and all releases, termination statements
and other documents and instruments as are necessary to
remove and release any Liens which may encumber any of the
Acquired Assets to be transferred at Closing.
ESCROW AGREEMENT
THIS ESCROW AGREEMENT (as the same may be amended or
modified from time to time and including any and all written
instructions given to "Escrow Agent" (hereinafter defined)
pursuant hereto, this "Escrow Agreement") is made and
entered into effective as of March 2, 1998 by and among
Intergraph Corporation, a Delaware corporation ("Seller"),
Unigraphics Solutions Inc., a Delaware corporation ("Buyer,"
and together with Seller, sometimes referred to collectively
as the "Other Parties"), and TEXAS COMMERCE BANKCHASE BANK
OF TEXAS, NATIONAL ASSOCIATION, a national banking
association (the "Bank").
W I T N E S S E T H:
WHEREAS, pursuant to an Asset Purchase Agreement dated
as of March 2, 1998 (the "Asset Purchase Agreement"), by and
among Buyer, certain subsidiaries of Buyer identified
therein (together with Buyer, the "Acquiring Entities"),
Seller, and certain subsidiaries of Seller identified
therein (together with Seller, the "Selling Entities"), the
Acquiring Entities are acquiring the assets comprising the
SolidEdge/EMS business of the Selling Entities;
WHEREAS, the Selling Entities have agreed to indemnify
Buyer from and against all Losses (as defined in the Asset
Purchase Agreement) arising out of, based upon or resulting
from the matters specified in Section 9.2 of the Asset
Purchase Agreement;
WHEREAS, to secure payment of Seller's indemnification
obligations, THREE MILLION DOLLARS ($3,000,000) of the
consideration to be received by Intergraph pursuant to the
Asset Purchase Agreement is being deposited, pursuant to
Section 2.3(b) of the Asset Purchase Agreement, in escrow to
be held as hereinafter provided; and
WHEREAS, Seller and Buyer have requested Bank to act in
the capacity of escrow agent under this Escrow Agreement,
and Bank, subject to the terms and conditions hereof, has
agreed so to do.
NOW, THEREFORE, in consideration of the premises and
mutual covenants and agreements contained herein, the
parties hereto hereby agree as follows:
I. Appointment of Escrow Agent. Each of Seller and Buyer
hereby appoints the Bank as the escrow agent under this
Escrow Agreement (the Bank in such capacity, the "Escrow
Agent"), and Escrow Agent hereby accepts such appointment.
II. Deposit. On March 2, 1998, Buyer will deposit with
the Escrow Agent, the sum of THREE MILLION DOLLARS
($3,000,000) (as such sum may increase or decrease
as a result of the investment and reinvestment thereof
and as said amount may be reduced by charges thereto
and payments and setoffs therefrom to compensate or
reimburse Escrow Agent for amounts owing to it pursuant
hereto, the "Deposit") to be held by Escrow Agent
in accordance with the terms hereof. Subject to and in
accordance with the terms and conditions hereof, Escrow
Agent agrees that it shall receive, hold in escrow, invest
and reinvest and release or distribute the Deposit. It is
hereby expressly stipulated and agreed that all interest and
other earnings on the Deposit shall become a part of the
Deposit for all purposes, and that all losses resulting from
the investment or reinvestment thereof from time to time and
all amounts charged thereto to compensate or reimburse the
Escrow Agent from time to time for amounts owing to it
hereunder shall from the time of such loss or charge no
longer constitute part of the Deposit.
III. Investment of the Deposit. Escrow Agent shall invest
and reinvest the Deposit in the VISTA Treasury Plus Money
Market Fund, U.S. Government obligations, bank certificates
of deposit (up to a maximum insured amount of any such
deposit) or repurchase agreements secured by U.S. Government
obligations, (individually, an "Investment" and
collectively, the "Investments"), as directed in writing by
the Other Parties. Absent written instructions from the
Other Parties, the Escrow Agent shall invest and reinvest
the Deposit in the VISTA Treasury Plus Money Market Fund.
Such written instructions, if any, referred to in the
foregoing sentence shall specify the type and identity of
the investments to be purchased and/or sold and shall also
include the name of the broker-dealer, if any, which the
Other Parties direct the Escrow Agent to use in respect of
such investment, any particular settlement procedures
required, if any (which settlement procedures shall be
consistent with industry standards and practices), and such
other information as Escrow Agent may require. Escrow Agent
shall not be liable for failure to invest or reinvest funds
absent sufficient written direction. Unless Escrow Agent is
otherwise directed in such written instructions, Escrow
Agent may use a broker-dealer of its own selection,
including a broker-dealer owned by or affiliated with Escrow
Agent or any of its affiliates. It is expressly agreed and
understood by the parties hereto that Escrow Agent shall not
in any way whatsoever be liable for losses on any
investments, including, but not limited to, losses from
market risks due to premature liquidation or resulting from
other actions taken pursuant to this Escrow Agreement.
Unless otherwise directed in writing by Seller and Buyer,
the Escrow Agent shall not invest all or any portion of the
Deposit in any Investment if the maturity date of such
Investment is later than March 2, 1999, or in the event this
Agreement remains in effect on and after such date, no later
than 90 days from the date each such Investment is made.
Receipt, investment and reinvestment of the Deposit
shall be confirmed by Escrow Agent as soon as
practicable by account statement, and any discrepancies
in any such account statement shall be noted by the
Other Parties to Escrow Agent within 30 calendar days
after receipt thereof. Failure to inform Escrow Agent
in writing of any discrepancies in any such account
statement within said 30-day period shall conclusively
be deemed confirmation of such account statement in its
entirety. For purposes of this paragraph, (a) each
account statement shall be deemed to have been received
by the party to whom directed on the earlier to occur
of (i) actual receipt thereof and (ii) three "Business
Days" (hereinafter defined) after the deposit thereof
in the United States Mail, postage prepaid and (b) the
term "Business Day" shall mean any day of the year,
excluding Saturday, Sunday and any other day on which
national banks are required or authorized to close in
Dallas, Texas.
IV. Disbursement of Deposit. Escrow Agent is hereby
authorized to make disbursements of the Deposit only as
follows:
A. At any time or times prior to the expiration of this
Agreement, Buyer may make claims against the Deposit for
indemnification pursuant to and in accordance with
Article IX of the Asset Purchase Agreement. Buyer shall
notify the Seller and the Escrow Agent in writing prior to
the expiration of this Agreement of each such claim,
including a summary of the amount of and bases for such
claim. If the Seller shall dispute such claim, Seller shall
give written notice thereof to Buyer and to the Escrow Agent
within fifteen (15) days after receipt of notice of Buyer's
claim, in which case the Escrow Agent shall not disburse any
disputed funds until it has received written instructions
executed by both Other Parties authorizing disbursement of a
specified amount of disputed funds to one or both of the
Other Parties; otherwise, such claim shall be deemed to have
been acknowledged to be payable out of the Deposit in the
full amount thereof, and the Escrow Agent shall use its best
efforts to pay such claim in immediately available funds to
Buyer within three (3) Business Days after expiration of
said fifteen day period or as soon thereafter as possible.
If the amount of the claim exceeds the value of the Deposit,
the Escrow Agent shall have no liability or responsibility
for any deficiency.
B. Escrow Agent is also authorized to make disbursements
of the Deposit, as permitted by this Escrow Agreement, to
Escrow Agent and into the registry of the court in
accordance with Sections 8 or 15 hereof.
C. Notwithstanding anything contained herein or elsewhere
to the contrary, the Other Parties hereby expressly agree
that the Escrow Agent shall be entitled to charge the
Deposit for, and pay and set-off from the Deposit, any and
all amounts, if any, then owing to it pursuant to this
Escrow Agreement prior to the disbursement of the Deposit in
accordance with clause (a) of this Section 4.
V. Tax Matters. Seller shall provide Escrow Agent with
its taxpayer identification number documented by an
appropriate Form W-8 or Form W-9 upon execution of this
Escrow Agreement. Failure so to provide such forms may
prevent or delay disbursements from the Deposit and may also
result in the assessment of a penalty and Escrow Agent being
required to withhold tax on any interest or other income
earned on the Deposit. Any payments of income shall be
subject to applicable withholding regulations then in force
in the United States or any other jurisdiction, as
applicable.
VI. Scope of Understanding. Escrow Agent's duties and
responsibilities in connection with this Escrow Agreement
shall be purely ministerial and shall be limited to those
expressly set forth in this Escrow Agreement. Escrow Agent
is not a principal, participant or beneficiary in any
transaction underlying this Escrow Agreement and shall have
no duty to inquire beyond the terms and provisions hereof.
Escrow Agent shall have no responsibility or obligation of
any kind in connection with this Escrow Agreement or the
Deposit and shall not be required to deliver the Deposit or
any part thereof or take any action with respect to any
matters that might arise in connection therewith, other than
to receive, hold, invest, reinvest and deliver the Deposit
as herein provided. Without limiting the generality of the
foregoing, it is hereby expressly agreed and stipulated by
the parties hereto that Escrow Agent shall not be required
to exercise any discretion hereunder and shall have no
investment or management responsibility and, accordingly,
shall have no duty to, or liability for its failure to,
provide investment recommendations or investment advice to
the Other Parties or either of them. Escrow Agent shall not
be liable for any error in judgment, any act or omission,
any mistake of law or fact, or for anything it may do or
refrain from doing in connection herewith, except for,
subject to Section 7 hereinbelow, its own willful misconduct
or gross negligence. It is the intention of the parties
hereto that Escrow Agent shall never be required to use,
advance or risk its own funds or otherwise incur financial
liability in the performance of any of its duties or the
exercise of any of its rights and powers hereunder.
VII. Reliance; Liability. Escrow Agent may rely on, and
shall not be liable for acting or refraining from acting
upon, any written notice, instruction or request or other
paper furnished to it hereunder or pursuant hereto and
believed by it to have been signed or presented by the
proper party or parties. Escrow Agent shall be responsible
for holding, investing, reinvesting and disbursing the
Deposit pursuant to this Escrow Agreement; provided,
however, that in no event shall Escrow Agent be liable for
any lost profits, lost savings or other special, exemplary,
consequential or incidental damages in excess of Escrow
Agent's fee hereunder and provided, further, that Escrow
Agent shall have no liability for any loss arising from any
cause beyond its control. Escrow Agent is not responsible
or liable in any manner whatsoever for the sufficiency,
correctness, genuineness or validity of the subject matter
of this Escrow Agreement or any part hereof or for the
transaction or transactions requiring or underlying the
execution of this Escrow Agreement, the form or execution
hereof or for the identity or authority of any person
executing this Escrow Agreement or any part hereof or
depositing the Deposit.
VIII. Right of Interpleader. Should any controversy
arise involving the parties hereto or any of them or any
other person, firm or entity with respect to this Escrow
Agreement or the Deposit, or should a substitute escrow
agent fail to be designated as provided in Section 15
hereof, or if Escrow Agent should be in doubt as to what
action to take, Escrow Agent shall have the right, but not
the obligation, either to (a) withhold delivery of the
Deposit until the controversy is resolved, the conflicting
demands are withdrawn or its doubt is resolved or
(b) institute a petition for interpleader in any court of
competent jurisdiction to determine the rights of the
parties hereto. In the event Escrow Agent is a party to any
dispute, Escrow Agent shall have the additional right to
refer such controversy to binding arbitration. Should a
petition for interpleader be instituted, or should Escrow
Agent be threatened with litigation or become involved in
litigation or binding arbitration in any manner whatsoever
in connection with this Escrow Agreement or the Deposit,
then, as between (a) the Other Parties on the one hand and
(b) Escrow Agent on the other, the Other Parties hereby
jointly and severally agree to reimburse Escrow Agent for
its attorneys' fees and any and all other expenses, losses,
costs and damages incurred by Escrow Agent in connection
with or resulting from such threatened or actual litigation
or arbitration prior to any disbursement hereunder.
IX. Indemnification. The Other Parties hereby jointly and
severally indemnify Escrow Agent, its officers, directors,
partners, employees and agents (each herein called an
"Indemnified Party") against, and hold each Indemnified
Party harmless from, any and all expenses, including,
without limitation, attorneys' fees and court costs, losses,
costs, damages and claims, including, but not limited to,
costs of investigation, litigation and arbitration, tax
liability and loss on investments suffered or incurred by
any Indemnified Party in connection with or arising from or
out of this Escrow Agreement, except such acts or omissions
as may result from the willful misconduct or gross
negligence of such Indemnified Party. IT IS THE EXPRESS
INTENT OF EACH OF SELLER AND BUYER TO INDEMNIFY AND HOLD
HARMLESS THE INDEMNIFIED PARTIES FROM THEIR OWN NEGLIGENT
ACTS OR OMISSIONS.
X. Compensation and Reimbursement of Expenses. As between
(a) Buyer on the one hand and (b) Seller on the other, each
of Buyer and Seller hereby agrees to pay Escrow Agent for
its services hereunder in accordance with the fee schedules
attached hereto from time to time by Escrow Agent and to pay
all expenses incurred by Escrow Agent in connection with the
performance of its duties and enforcement of its rights
hereunder and otherwise in connection with the preparation,
operation, administration and enforcement of this Escrow
Agreement, including, without limitation, attorneys' fees,
brokerage costs and related expenses incurred by Escrow
Agent, one-half to be paid by each of Buyer and Seller. The
foregoing notwithstanding, as between (a) the Other Parties
on the one hand and (b) the Escrow Agent on the other, the
Other Parties shall be jointly and severally liable to
Escrow Agent for the payment of all such fees and expenses.
In the event the Other Parties for any reason fail to pay
any such fees and expenses as and when the same are due,
such unpaid fees and expenses shall be charged to and set-
off and paid from the Deposit by Escrow Agent without any
further notice.
XI. Lien. Each of the Other Parties hereby grants to
Escrow Agent a lien upon, and security interest in, all its
right, title and interest in and to all of the Deposit as
security for the payment and performance of its obligations
owing to Escrow Agent hereunder, including, without
limitation, its obligations of payment, indemnity and
reimbursement provided for hereunder, which lien and
security interest may be enforced by Escrow Agent without
notice by charging and setting-off and paying from, the
Deposit any and all amounts then owing to it pursuant to
this Escrow Agreement or by appropriate foreclosure
proceedings.
XII. Notices. Any notice or other communication required or
permitted to be given under this Escrow Agreement by any
party hereto to any other party hereto shall be considered
as properly given if in writing and (a) delivered against
receipt therefor, (b) mailed by registered or certified
mail, return receipt requested and postage prepaid or
(c) sent by telex, telefax machine or prepaid telegram, in
each case addressed as follows:
If to Escrow Agent:
Chase Bank of Texas, National Association
Ross Avenue, 5th Floor
Dallas, Texas 75201
Attn: Michael Scrivner
Telefax No.: (214) 965-3531
Telephone No.: (214) 965-3577
If to Seller, to:
Intergraph Corporation
Huntsville, Alabama 35894-0001
Attn: John W. Wilhoite
Facsimile No.: (205) 730-2408
Telephone No.: (205) 730-2637
Federal Tax ID No.: 63-0573222
with a copy to:
Intergraph Corporation
Huntsville, Alabama 35894-0001
Attn: General Counsel
Facsimile No.: (205) 730-2247
If to Buyer, to:
Unigraphics Solutions Inc.
Riverport Drive
Maryland Heights, Missouri 63043
Attn: President
Facsimile No.: (314) 232-1523
Telephone No.: (314) 344-8760
Federal Tax ID No.: 75-2728894
with a copy to:
Electronics Data Systems Corporation
Legacy Drive, Mailstop H3-3D-05
Plano, Texas 75024
Attention: General Counsel
Telephone: (972) 605-6000
Telecopy: (972) 605-5613
Except to the extent otherwise provided in
the second paragraph of Section 3
hereinabove, delivery of any communication
given in accordance herewith shall be
effective only upon actual receipt thereof by
the party or parties to whom such
communication is directed. Any party to this
Escrow Agreement may change the address to
which communications hereunder are to be
directed by giving written notice to the
other party or parties hereto in the manner
provided in this section.
XIII. Consultation with Legal Counsel. Escrow Agent may
consult with its counsel or other counsel satisfactory to it
concerning any question relating to its duties or
responsibilities hereunder or otherwise in connection
herewith and shall not be liable for any action taken,
suffered or omitted by it in good faith upon the advice of
such counsel.
XIV. Choice of Laws; Cumulative Rights. This Escrow
Agreement shall be construed under, and governed by, the
laws of the State of Texas, excluding, however, (a) its
choice of law rules and (b) the portions of the Texas Trust
Code Sec. 111.001, et seq. of the Texas Property Code
concerning fiduciary duties and liabilities of trustees.
All of Escrow Agent's rights hereunder are cumulative of any
other rights it may have at law, in equity or otherwise.
The parties hereto agree that the forum for resolution of
any dispute arising under this Escrow Agreement shall be
Dallas County, Texas, and each of the Other Parties hereby
consents, and submits itself, to the jurisdiction of any
state or federal court sitting in Dallas County, Texas
solely for the purposes of resolving any dispute arising
under this Escrow Agreement.
XV. Resignation. Escrow Agent may resign hereunder upon
thirty (30) days' prior notice to the Other Parties. Upon
the effective date of such resignation, Escrow Agent shall
deliver the Deposit to any substitute escrow agent
designated by the Other Parties in writing. If the Other
Parties fail to designate a substitute escrow agent within
thirty (30) days after the giving of such notice, Escrow
Agent may either institute a petition for interpleader or
appoint a successor escrow agent. Escrow Agent's sole
responsibility after such 30-day notice period expires shall
be to hold the Deposit (without any obligation to reinvest
the same) and to deliver the same to a designated substitute
escrow agent, if any, or in accordance with the directions
of a final order or judgment of a court of competent
jurisdiction, at which time of delivery Escrow Agent's
obligations hereunder shall cease and terminate.
XVI. Assignment. Either of the Other Parties may assign its
rights hereunder upon giving written notice of such
assignment to Escrow Agent and the Other Party. No such
assignment shall relieve such Other Party from its duties,
obligations and liabilities hereunder. This Escrow
Agreement may be assigned by either of the Other Parties
with the prior written consent of Escrow Agent (such assigns
of the Other Parties to which Escrow Agent consents, if any,
and Escrow Agent's assigns being hereinafter referred to
collectively as "Permitted Assigns").
XVII. Severability. If one or more of the provisions
hereof shall for any reason be held to be invalid, illegal
or unenforceability in any respect under applicable law,
such invalidity, illegality or unenforceability shall not
effect any other provisions hereof, and this Escrow
Agreement shall be construed as if such invalid, illegal or
unenforceable provision had never been contained herein, and
the remaining provisions hereof shall be given full force
and effect.
XVIII. Termination. This Escrow Agreement shall
terminate upon the earliest of: (a) disbursement of all the
Deposit in accordance with Section 4 hereof, and unless
Escrow Agent shall otherwise elect, full and final payment
of all amounts required to be paid to the Escrow Agent
hereunder (whether fees, expenses, costs or otherwise), and
(b) March 2, 1999 (the "Initial Termination Date"),
if Escrow Agent has not received notice of any
outstanding, unpaid or disputed claims made by Buyer
pursuant to Section 4(a) on such date. If the Escrow Agent
has not received notice of any outstanding, unpaid or
disputed claims, then Escrow Agent shall distribute the
Deposit, nethe Escrow Agent shall distribute the Deposit,
net of any amounts owed to the Escrow Agent to the Seller.
If on the Initial Termination Date the Escrow Agent has
received notice of any unpaid or disputed claims (or claims
for which the period for Seller to dispute the claim has not
expired [(the "Unexpired Claims"]) under Section 4(a) exist,
then the Escrow Agent will retain an amount of the Deposit
equal to the sum of: (i) the principal amount of the
unpaid, disputed or Unexpired Claims which Escrow Agent has
received notice of, and (ii) any amounts owed to the Escrow
Agent, and will deliver the remainder of the Deposit to the
Seller. The undisbursed portion of the Deposit will
continue to be subject to this Escrow Agreement until the
Escrow Agent has received written instruction executed by
both Other Parties authorizing disbursement of the remainder
of the Deposit to one or both of the Other Parties. The
provisions of Section 10 hereof shall survive the
termination hereof and, provided further, that the last two
sentences of Section 8 hereof and the provisions of
Section 9 hereof shall, in any event survive the termination
hereof.
XIX. General. The section headings contained in this Escrow
Agreement are for reference purposes only and shall not
affect in any way the meaning or interpretation of this
Escrow Agreement. This Escrow Agreement and any affidavit,
certificate, instrument, agreement to other document
required to be provided hereunder may be executed in two or
more counterparts, each of which shall be deemed an
original, but all of which taken together shall constitute
but one and the same instrument. Unless the context shall
otherwise require, the singular shall include the plural and
vice-versa, and each pronoun in any gender shall include all
other genders. The terms and provisions of this Escrow
Agreement constitute the entire agreement among the parties
hereto in respect of the subject matter hereof, and neither
(a) the Other Parties on the one hand nor (b) Escrow Agent
on the other has relied on any representations or agreements
of the other, except as specifically set forth in this
Escrow Agreement. This Escrow Agreement or any provision
hereof may be amended, modified, waived or terminated only
by written instrument duly signed by the parties hereto.
This Escrow Agreement shall inure to the benefit of, and be
binding upon, the parties hereto and their respective heirs,
devisees, executors, administrators, personal
representatives, successors, trustees, receivers and
Permitted Assigns. This Escrow Agreement is for the sole and
exclusive benefit of the Other Parties and their Permitted
Assigns and the Escrow Agent, and nothing in this Escrow
Agreement, express or implied, is intended to confer or
shall be construed as conferring upon any other person any
rights, remedies or any other type or types of benefits.
Remainder of Page Intentionally Left Blank.
Signature Page(s) Follow.
IN WITNESS WHEREOF, the parties hereto have executed
this Escrow Agreement to be effective as of the date first
above written.
"SELLER"
INTERGRAPH CORPORATION
By: /s/ John W. Wilhoite
Name: John W. Wilhoite
Title: Vice President
"BUYER"
UNIGRAPHICS SOLUTIONS INC.
By: /s/ H. Timothy Hatfield
Name: H. Timothy Hatfield
Title: Vice President
"ESCROW AGENT"
CHASE BANK OF TEXAS,
NATIONAL ASSOCIATION
By: /s/ Michael A. Scrivner
Michael A. Scrivner
Vice President
EXHIBIT A
CHASE BANK OF TEXAS, NATIONAL ASSOCIATION
FEE SCHEDULE
Scenario 1: If the Escrow Deposit is invested in any Vista Money
Market Fund
Fees for the Bank's standard services shall be as follows:
**New Account Acceptance Fee.....................$750.00
**Minimum Administrative Fee.....................$1,500.00
**Payable Upon Account Opening and in Advance
Scenario 2: If the Escrow Deposit is not invested in any Vista
Money Market Fund
Fees for the Bank's standard services shall be as follows:
**New Account Acceptance Fee.....................$750.00
**Minimum Administrative Fee.....................$3,000.00
**Payable Upon Account Opening and in Advance
ACTIVITY FEES:
Investments $50.00
(per directed buy/sell)
If our money market funds/collective investment funds are
utilized, a fee will be deducted monthly from fund/account at an
annual rate of .5%
Disbursements
Per Check/Intra Bank Credit $15.00
Per Wire U.S. $30.00
International $100.00
(Includes annual Tax Reporting)
A New Account Acceptance Fee will be charged for the Bank's
review of the Agreement along with any related account documentation. A
one (1) year Minimum Administration Fee will be assessed for any
account which is funded. The account will be invoiced in the
month in which the account is opened and annually thereafter.
Payment of the invoice is due 30 days following receipt.
The Administrative Fee will cover a maximum of fifteen (15)
annual administrative hours for the Bank's standard services
including account setup, safekeeping of assets, investment of
funds, collection of income and other receipts, preparation of
statements comprising account activity an asset listing, and
distribution of assets in accordance with the specific terms of
the agreement.
Extraordinary Services:
Any additional services beyond our standard services as specified
above, such as annual administrative activities in excess of
fifteen (15) hours and all reasonable out-of-pocket expenses
including attorney's fees will be considered extraordinary
services for which related costs, transaction charges, and
additional fees will be billed at the Bank's standard rate.
Modification of Fees:
Circumstances may arise necessitating a change in the foregoing
fee schedule. The Bank will attempt at all times, however, to
maintain the fees at a level which is fair and reasonable in
relation to the responsibilities assumed and the duties
performed.
All fees quoted are subject to our review and acceptance, and
that of our legal counsel, of the documents governing the escrow.
As a condition for acceptance of an appointment, it is expected
that all legal fees and out-of-pocked expenses incurred by Chase
Bank of Texas, National Association and our counsel in connection
with our review of the transaction will be paid by the issuer
regardless of whether or not the transaction closes.
AGREEMENT
THIS AGREEMENT entered into and effective this 2nd day of March,
1998, between Intergraph Corporation, with its principal place of
business at One Madison Industrial Park, Huntsville, Alabama,
35894-0001, (hereinafter called "Intergraph") and Unigraphics
Solutions Inc., with its principal place of business at 13736
Riverport Drive, Maryland Heights, MO 63043-4826 (hereinafter
called "Company").
WITNESSETH:
WHEREAS, Intergraph is engaged in the manufacturing, selling and
maintaining of hardware, software, computers and computer systems
for the computer industry, including computer aided drafting,
computer aided manufacturing and computer aided engineering
(CAD/CAM/CAE); and
WHEREAS, Company is in the business of providing software
products, software maintenance and/or training useful with such
equipment; and
WHEREAS, contemporaneously herewith, Intergraph and USI and
certain of their respective affiliates have entered into that
certain Asset Purchase Agreement of even date herewith (the
"Asset Purchase Agreement") pursuant to which Intergraph has
sold, transferred or licensed to USI certain assets relating to
Intergraph's "Solid Edge" product line and line of business (the
"Solid Edge Assets"); and
WHEREAS, pursuant to the Asset Purchase Agreement, Intergraph has
sold, transferred or licensed to USI substantially all of the
Solid Edge Assets but has retained its rights under or in
connection with Intergraph's contracts with Spatial Technology,
Inc., a Delaware corporation ("STI"), relating to certain
software programs of STI marketed and sold under the name "ACIS"
(the "Retained STI Rights"); and
WHEREAS, Intergraph and USI have, contemporaneously herewith,
entered into that certain Intergraph Reseller Agreement (Solid
Edge Version 4.0) (the "Primary Reseller Agreement") pursuant to
which (i) USI has granted back to Intergraph a right and license
relating to the Solid Edge Assets (excluding the Retained STI
Rights), which together with Intergraph's Retained STI Rights, is
sufficient to permit Intergraph to make and sell to USI, kits
containing Version 4.0 of Solid Edge and Solid Edge Drafting in
object code form (the "Version 4.0 Kits"); (ii) Intergraph has
agreed to supply Version 4.0 Kits to USI at Intergraph's actual
production cost upon the terms and conditions contained in the
Primary Reseller Agreement; (iii) USI is permitted to resell the
Version 4.0 Kits throughout the world, either directly or through
USI's distribution channels, using Intergraph's standard form end-
use license; and (iv) USI agrees to provide maintenance for
Version 4.0 other than with respect to the portion thereof
composed of the Retained STI Rights (the maintenance of which is
the exclusive responsibility of Intergraph); and
WHEREAS, the United States Government through the U.S. Navy
(hereinafter called the "Government") has a program established
with Intergraph commonly called CAD-2 for the procurement of
state-of-the-art CAD/CAM/CAE equipment; and
WHEREAS, this Agreement addresses the terms and conditions under
which USI will furnish Version 4.0 Kits to Intergraph for further
distribution or sale by Intergraph under its NAVAIR, NAVFAC and
NAVSEA Prime Contracts (hereinafter called the "CAD -2
Programs").
NOW, THEREFORE, IN CONSIDERATION OF THE FOREGOING PREMISES AND
MUTUAL COVENANTS SET FORTH HEREIN, THE PARTIES AGREE AS
FOLLOWING:
Section A - Definitions
For the purposes of this Agreement, the following terms are
defined as follows:
1. "Contract" and "Agreement" means this Agreement.
2. "DFARS" means the Defense Federal Acquisition Regulations
3. "FAR" means the Federal Acquisition Regulation.
4. "Prime Contracts" means the contracts between Intergraph
Corporation and the U.S. Government.
5. "Software" shall mean the Solid Edge Version 4.0 software
modules in object code form in Version 4.0 Kits plus any
maintenance updates that may be provided to Solid Edge
Version 4.0 in accordance with the terms, conditions and
limitations hereof.
6. "Software Documentation" shall mean the user documentation
identified in EXHIBIT B provided with the Software.
7. "Territory" shall include all countries of the world except
as prohibited by United States laws, regulations, orders and
other restrictions regarding the import and export of
computer software, technical data or derivatives of such
technical data.
Section B - Software/Training
B-1 Type of Contract
(a) This is a firm fixed price Indefinite Delivery/Indefinite
Quantity type Contract as described in Federal Acquisition
Regulation (FAR) 16.504.
(b) Unless this Agreement is terminated earlier in accordance
with Section H-12, Intergraph will be allowed to license
Software and purchase services from Company, and to
sublicense to the Government, the Software and/or services
described in Exhibit A for the period of performance under
the Prime Contracts which shall not extend beyond the year
2006 without the mutual consent of the parties hereto. It
is anticipated that the first eight years (8) of the
Intergraph Prime Contracts will primarily involve
procurement of hardware and software with the remaining four
(4) years utilized for the procurement of maintenance and
support of those products. As the Prime Contracts to
Intergraph will be a fixed price, indefinite delivery,
requirements contract, Intergraph cannot guarantee nor
anticipate the level of Software and/or service(s) that
will be ordered from the Exhibit A listing. Issuance of
orders by Intergraph to Company will be predicated upon
Intergraph receiving from the Government, Prime Contract
Delivery Orders for the products and/or services offered by
Company.
B-2 Consideration
Company hereby grants to Intergraph the rights to license and
sublicense within the Territory Company's software, maintenance,
training and other services as set for in Exhibit A attached
hereto solely on the CAD-2 Programs. Intergraph shall have the
right to license and sublicense the Software to CONUS and OCONUS
locations. The prices of the Software licenses, maintenance,
training and other services provided by Company hereunder are set
forth in EXHIBIT A to this Agreement. Company agrees to deliver
Software to Intergraph in kit format in the form provided to
other Solid Edge Version 4.0 licensees.
Section C - Specifications
In consideration of Company's purchase of the Solid Edge Assets
pursuant to the Asset Purchase Agreement, and the representations
and warranties provided to Company by Intergraph therein, Company
makes no representations under this Agreement in respect to the
compliance with specifications of the Version 4.0 Kits. Company
warrants that such products are being licensed back to Intergraph
on an "as is" condition in the same version as was acquired by
Company with no changes or modifications. Company represents that
it will use reasonable efforts to provide maintenance, training,
documentation and other services under the Agreement in a manner
substantially in conformance with, and subject to the limitations
in, EXHIBITS C, D, and E hereto.
Section D - Packaging and Marking
D-1 Standard Packing
Except as otherwise specified in a Purchase Order, the packaging
and packing of all items shall comply with ASTM-D-3951-88,
"Standard Practice for Commercial Packaging."
D-2 Prohibited Packing Materials
The use of asbestos, excelsior, newspaper, or shredded paper (all
types including waxed paper, computer paper, and similar
hygroscopic or non-neutral material) is prohibited.
Section E - Inspection and Acceptance
E-1 Inspection/Acceptance Authority
Responsibility for inspecting, approving and accepting Software,
maintenance and or training services/courses rendered by the
Company in the performance of this Agreement shall rest with the
Intergraph's Technical Representative (ITR). All articles
delivered hereunder will be subject to inspection and approval by
Intergraph after delivery, notwithstanding payment for said
articles has been made to Company. It is expressly agreed that
payment shall not constitute acceptance.
(a) It is agreed that Intergraph shall, within ten (10) calendar
days from receipt of software, notify Company in writing
that: (I) Acceptance has occurred; or (ii) Acceptance has not
occurred, in which case said notice shall specify the
particular reason for non-acceptance. In the absence of
written notification from Intergraph, Acceptance by
Intergraph shall be considered to have occurred ten (10)
calendar days after Intergraph receives software. Software
acceptance shall consist of a determination by the ITR that
the Software has been received in good condition and in the
quantities specified on the packaging slip.
(b) In respect to services including training services/courses,
the ITR inspection and acceptance shall consist of whether
services were provided in conformance with the provisions of
Exhibit D and that topics listed on the course outline were
covered by the instructor during presentation of the training
services.
(c) Maintenance services shall be deemed to be inspected and
accepted by the ITR when provided in conformance with the
provisions of Exhibit C.
Section F - Deliveries or Performance
F-1 Purchase Orders
Issuance of purchase orders ("Purchase Orders") by Intergraph to
Company will be predicated upon Intergraph receiving from the
Government, a Purchase Order for the Company's products and/or
services. Intergraph shall place written Purchase Orders during
the term of this Agreement. Each Purchase Order placed by
Intergraph shall contain a description of the product and/or
service, applicable fees and the following minimum information:
(i) a reference to this Agreement; (ii) identification of each
product or service ordered, quantity and net price; (iii)
shipping instructions and destination, and (iv) requested
delivery date for each product and/or service. Notwithstanding
Section F-2 below, delivery dates for Intergraph orders which
involve the services of Company personnel including training
services shall be subject to mutual agreement between Intergraph
and the Company. Intergraph agrees to review proposed delivery
schedules for such services with Company in advance to assure
that Purchase Orders are issued with delivery dates acceptable to
Company.
F-2 Place of Delivery and Performance
The place of delivery for Software, including commercial Software
Documentation, shall be FOB Destination Intergraph Corporation,
Huntsville, Alabama, within thirty (30) calendar days from
receipt by Company of the Purchase Order. The locations and
dates for conducting training classes and/or performing services
shall be mutually agreed by Intergraph and Company. Should the
Government so require, Company agrees to negotiate an advance or
delay of the delivery date to assist Intergraph to meet the Prime
Contract requirements subject to Section F-1 above. Travel and
living expenses of Company personnel incurred while providing
training or other services will be reimbursed by Intergraph in
accordance with the Government DOD Civilian Personnel Joint
Travel Regulations.
Section G - Invoices and Payments
G-1 Invoices
An original and one copy of accurate and complete invoices may be
submitted to the following address:
Intergraph Corporation
Huntsville, AL 35894-0001
Attn: Account Payable
G-2 Software License Payments
Payments for Software licenses provided by Company to Intergraph
under this Agreement will be rendered within thirty (30) days
after the end of each quarterly calendar period during which this
Agreement is in effect, with periods ending on March 31st, June
30th, September 30th and December 31st. Intergraph shall provide
Company with a statement identifying the Software and services
delivered by Company to Intergraph during the quarter, and the
amount of fees payable for the quarter as identified in the
Purchase Orders for same. The statement shall be accompanied by
payment in full shown therein to be payable.
G-3 Maintenance Payments
Maintenance fees for new Software licenses purchased after the
date of execution of this Agreement shall be payable monthly in
arrears beginning one (1) year after Intergraph's acceptance of
the Software, provided that such services are purchased by
Intergraph. Maintenance fees shall be applicable only for
Software licenses under current maintenance coverage. The
standard Company maintenance reinstatement fee shall be
applicable if maintenance is discontinued for Software licenses
and reinstated at a later date. Maintenance fees for Software
seats already installed under the CAD-2 program on the Effective
Date of this Agreement and which are subject to maintenance
contracts shall be payable to Company after the Effective Date on
a monthly basis so long as such pre-Effective Date maintenance
contract remains in effect. Maintenance fees shall be paid to
Company each month after maintenance service is initiated for
each Software license. Intergraph shall identify in writing all
such licensed seats, the dates of their installation, and the
effective dates that maintenance services were initiated, within
thirty (30) days of execution of this Agreement and will issue a
Purchase Order for such maintenance to Company. Company will
invoice such charges monthly in arrears and payments will be
rendered by Intergraph within thirty (30) days from the date of
invoice receipt.
G-4 Training Payments
Company shall issue Intergraph individual invoices after training
courses or other training services are delivered under this
Agreement, and Intergraph shall pay Company in full for training
purchased hereunder within thirty (30) days of receipt and
acceptance of said invoice.
G-5 Taxes
Intergraph shall be liable for, and shall indemnify and hold
Company harmless from and against, all applicable sales and use,
value added, consumption, registration, stamp and similar taxes
imposed upon the payments made by Intergraph to Company hereunder
("Applicable Taxes"). Applicable Taxes shall not include
Company's franchise taxes, income taxes, and other taxes based on
net or gross income. Intergraph agrees to pay to Company any
Applicable Taxes which Company is required to collect and pay
over to any taxing authority or provide Company with a valid
exemption certificate or other documentary evidence of statutory
exemption.
Section H - Special Contract Requirements
H-1 Pricing and No-Charge Maintenance
Company's prices listed under Exhibit A for the Software,
maintenance and associated training services are firm-fixed for
the period of this Agreement. However, the parties recognize and
agree that at the time of annual renewal of the Prime contracts,
the prices payable by the Government to Intergraph and prices
payable by Intergraph to Company (since Company prices are based
on the Intergraph prices to the Government), are subject to
reduction only to the extent that Company's standard list prices
for the Software, maintenance and/or training in effect at that
time may have been reduced from those prices in effect at the
time of the last such renewal. Company agrees to notify
Intergraph at least six (6) months prior to the end of the life
or discontinuance of Company support or availability of any of
the products or services listed in Exhibit A. All new Software
delivered under this Agreement shall be covered by a one (1) year
no charge maintenance period from the date of Software licenses
acceptance. During such period, Intergraph's CAD-2 Program Users
shall receive the same level of support from Company as if the
Software product was under full service maintenance which Company
makes available to its other commercial customers.
H-2 Software Rights
(a) The Software and Documentation are provided with RESTRICTED
RIGHTS. The use, duplication or disclosure of the Software
and Software Documentation provided under this Agreement
will be subject to the RESTRICTED RIGHTS clause as set forth
in DFARS 252.227-7013(Oct 88) "Commercial Computer Software
- Restricted Rights", and any successor or similar
regulation, as applicable.
(b) Except for problems related to Section C, Company shall not
be responsible for adverse impact to workstations or servers
acquired under the CAD-2 Programs caused by the Software or
by Government-owned hardware and peripheral devices.
(c) Company represents that it owns and/or has the right to sell
the Software and Software Documentation in accordance
herewith. Software and Software Documentation provided by
Company may also include software which is licensed to
Company by third party suppliers with the right to further
sublicense to Intergraph under this Agreement. Certain
third party owned Software may require additional special
terms which shall be incorporated into this Agreement by
written amendment.
(d) Intergraph acknowledges that notwithstanding any terms to
the contrary contained in this Agreement, all proprietary
interest and rights in the Software (other than with respect
to the Retained STI Rights) are and shall remain the
exclusive property of Company or its supplier(s), including
without limitation, any and all intellectual property rights
or confidential information arising from or associated with
the use of the Software (other than with respect to the
Retained STI Rights).
(e) Except as and only to the extent expressly permitted in this
Agreement, Intergraph shall not, and shall prohibit all
other parties including the Government, within the terms of
its written agreements with such parties, any right to use,
sublicense, sell, assign, convey, transfer, disclose,
publish, copy, duplicate, disassemble, reverse engineer,
decompile or otherwise modify the Software, or use the
Software for any purpose other than as expressly provided in
this Agreement.
(f) Company hereby grants to Intergraph for the period of this
Agreement, a non-transferable and non-exclusive license to
install and use internally, seats of the Software described
in EXHIBIT A of this Agreement in object code form, for the
purpose of internal coordination at Intergraph.
The Company hereby grants to Intergraph a non-exclusive and
nontransferable license to use the Software identified in
Exhibit A without fee solely for demonstrations to existing
or potential CAD-2 Program Users, and for Software's'
training and support. Company shall provide Intergraph with
fee-free copies of Software identified in Exhibit A for the
purposes referenced above.
As part of the demonstration to potential CAD-2 Program
Users, Intergraph shall be allowed to loan copies of the
Software identified in Exhibit A and this shall be on a fee-
free basis. All CAD-2 Program User loans shall be limited
to a reasonable period of use for evaluation purposes, and
copies used for productive purposes shall be specifically
excluded from this provision. Intergraph agrees to use its
best judgment in the loaning of the Software identified in
Exhibit A. Company shall provide Intergraph with fee-free
copies of the Software identified in Exhibit A for the
purposes referenced above.
Company grants Intergraph the right to license the Software
identified in Exhibit A as an independent product or bundled
with other products provided by Intergraph to CAD-2 Program
Users.
(g) All agreements between Intergraph and the Government for
Software licenses, maintenance, training and other services
provided by Company to Intergraph shall be in written form
and shall include at a minimum, terms to the following
effect:
(1) Software licenses shall not be restricted to
specific personnel, but may contain devices or
provisions which limit the number of concurrent
executables operating at any one time (e.g. if 16
single user licenses are acquired, then any licensed
user up to a maximum of 16 licensed users may execute
the Software at any one time).
(2) Intergraph shall not be required to include in its
agreements the requirement for a physical device (i.e.
keys) which restricts the Software to a specific CPU
serial number.
(3) Terms shall prohibit the Government from
disclosing the Software to any third parties without
prior execution of a written agreement of
nondisclosure.
(4) A statement specifying the RESTRICTED RIGHTS
obligations and rights applicable to the Software and
Software Documentation such as contained in Section H-
2(a) of this Agreement shall be included.
(5) The Government shall have the right to use options
which minimize system management requirements. That
is, licenses shall be maintainable on a single FAN
resource, shall be accessible from any resources on the
FAN at the option of the site's system manager up to
the number of Software licenses authorized per site,
shall be transparently transferable among licensed
servers or licensed workstations at a given site and
shall be monitorable by the site's system manager.
Company represents and Intergraph acknowledges Company's
representation that a valid Company copyright subsists in
the Software. In duplicating any portion of the Software,
Intergraph shall reproduce all copyright and other
proprietary rights notices contained in or affixed to the
Software and Software Documentation.
(h) Company shall not be liable to Intergraph or the Government
for any failure or delay in performance of any provision of
this Agreement caused by events beyond Company's control,
including, but not limited to, an act of God, labor strike,
management lock-outs, riots, sabotage, accidents, war, civil
unrest, inability to procure supplies or components,
failures in communication, technical failures or any similar
cause. The time for carrying out the obligations shall
extend for a period equal to the period during which the
conditions causing the failure or delay in performance
existed.
(i) Company shall furnish, at no additional charge to
Intergraph, all Software maintenance for a minimum period of
twelve (12) months beginning on the first day following each
individual new Software license acceptance by Intergraph.
Coverage shall be identical to Software maintenance as
defined in Exhibit C.
H-3 Indemnification
(a) Each party shall indemnify, defend, and hold the other party
harmless from any and all claims, actions, damages,
liabilities, costs and expenses (including, without
limitation, reasonable attorney's fees) arising directly and
proximately out of the indemnifying party's negligence, or
willful, wanton or reckless conduct resulting in death or
bodily injury of any person or damage to any real or
tangible personal property.
(b) Intergraph shall defend, indemnify and hold Company harmless
from and against any and all claims arising as a result of:
(i) the results obtained or decisions made by the Government
end users as a result of their use of the Software, Software
Documentation, or services provided by Company hereunder;
(ii) any representations and warranties that may be made by
Intergraph to the Government in regard to Company's
Software, Software Documentation and services provided to
Intergraph hereunder.
Company shall defend, indemnify and hold Intergraph harmless
from and against any and all claims arising as a result of
any representations and warranties that may be made by
Company to the Government in regard to Company's Software,
Software Documentation and services provided to Intergraph
hereunder.
(c) Intergraph warrants that the terms of this Agreement and the
business activities contemplated hereunder do not breach the
terms of the agreement between Intergraph and Spatial
Technology Inc. in regard to the Retained STI Rights.
H-4 Commitments, Warranties and Representations, and
Limitations of Liability
(a) Written commitments made by the Company within the scope of
this Agreement shall be binding on the Company. For the
purposes of this Agreement, a written commitment shall
include the contents of this Agreement and written
amendments to this Agreement. Other Company written
proposals, representations, literature, drawings and
specification as to Software performance, systems
performance, component characteristics, compliance with
standards and the like (if any) shall not be considered
written commitments and binding on the Company unless (1)
they are delivered to Intergraph in written form and (2) a
separate written acknowledgment identifying the subject
correspondence as a binding commitment of the Company is
provided by the Company Contracts Department to the
Intergraph Contracts Department as identified in Section H-
16.
(b) Except as otherwise provided by applicable law, no claim,
regardless of form, arising out of or in connection with
this Agreement may be brought by either party more than two
(2) years after the cause of action has accrued.
(c) EXCEPT AS SET FORTH IN THIS AGREEMENT, COMPANY MAKES NO
WARRANTY OR REPRESENTATION, EXPRESS OR IMPLIED, WITH RESPECT
TO ANY MATTER WHATSOEVER, INCLUDING, WITHOUT LIMITATION, THE
SOFTWARE OR ANY OUTPUT BASED ON ITS USE, THE SOFTWARE
DOCUMENTATION, MAINTENANCE, OR OTHER COMPANY SERVICES
PROVIDED HEREUNDER. COMPANY SPECIFICALLY DISCLAIMS, WITHOUT
LIMITATION, ANY IMPLIED WARRANTY OF MERCHANTABILITY OR
FITNESS FOR A PARTICULAR PURPOSE. THE TOTAL LIABILITY OF
COMPANY FOR ALL CLAIMS, WHETHER IN CONTRACT, TORT (INCLUDING
NEGLIGENCE AND INFRINGEMENT INDEMNIFICATION) OR OTHERWISE,
ARISING OUT OF, CONNECTED WITH, OR RESULTING FROM THE
LICENSE, DELIVERY, INSTALLATION, USE, SUPPORT, OR
MAINTENANCE OF THE SOFTWARE, SOFTWARE DOCUMENTATION AND
OTHER SERVICES, SHALL NOT EXCEED THE TOTAL AMOUNT OF LICENSE
FEES AND OTHER FEES SET FORTH IN EXHIBIT A PAID BY
INTERGRAPH TO COMPANY UNDER THIS AGREEMENT. IN NO EVENT
SHALL EITHER PARTY BE LIABLE TO THE OTHER, THE GOVERNMENT,
OR ANY OTHER PARTY, UNDER OR IN CONNECTION WITH THIS
AGREEMENT UNDER ANY THEORY OF TORT, CONTRACT, STRICT
LIABILITY, OR OTHER LEGAL OR EQUITABLE THEORY FOR ANY
INCIDENTAL, CONSEQUENTIAL, INDIRECT, OR SPECIAL DAMAGES,
INCLUDING, WITHOUT LIMITATION, DAMAGES FOR LOSS OF REVENUE,
LOSS OF PROFIT, OR COST OF SERVICE INTERRUPTIONS, ARISING OR
ALLEGEDLY ARISING FROM THE PERFORMANCE OR ALLEGED FAILURE TO
PROPERLY PERFORM ITS OBLIGATIONS UNDER THE AGREEMENT,
WHETHER OR NOT RESULTING FROM THE ALLEGED NEGLIGENCE OR
GROSS NEGLIGENCE OF SUCH PARTY OR ITS EMPLOYEES.
(d) In consideration of the representations and warranties
extended to Company by Intergraph under the Asset Purchase
Agreement, Company makes no representations or warranties
under this Agreement with respect to operability or
functionality of the Software on or after January 1, 2000.
(e) Company agrees to use reasonable efforts to develop and
maintain a quality system in accordance with ISO 9001, or a
commercially acceptable equivalent quality system, or as an
alternate, Company's quality program will be made available
for audit by applicable Intergraph personnel upon mutually
agreeable terms.
H-5 Publicity
It is a specific condition of this Agreement that the Company
shall not use or allow to be used any aspect of this Agreement
for publicity or advertisement purposes without prior written
consent of Intergraph. Intergraph will use reasonable efforts to
secure such approval from the Government and shall not
unreasonably withhold Intergraph's consent to Company.
H-6 Intergraph's Technical Representative (ITR)
The Intergraph Technical Representative (ITR) will provide
technical coordination and discussion with Company as necessary
with respect to the progress and quality of Company performance
under this Agreement. The ITR does not have the authority to take
any action, either directly or indirectly, that would change the
pricing, quantity, quality, place of performance, delivery
schedule, or any other terms and conditions of the basic
Agreement, or to direct the accomplishment of effort which goes
beyond the scope of the basic contractual specifications; any
such action shall be effective only with the written agreement of
Company and appropriate Intergraph parties.
The name of the ITR, when applicable, will be specified in
individual Purchase Orders.
H-7 Security Clearances
If applicable, Company facility and personnel clearance
requirements for the performance of this Agreement will be
specified with each Purchase Order on a DD Form 254. Company
shall arrange for applicable Company personnel to obtain from the
Defense Investigative Service (DIS), at a minimum, an interim
CONFIDENTIAL clearance subject to final clearance approval within
40 days of the clearance request. There may be instances where a
higher clearance level is required (i.e., SECRET and/or TOP
SECRET). Unless security clearance levels are specified on an
individual Purchase Order this requirement will not apply.
Delivery schedules within Intergraph orders shall be adjusted to
reflect the lead times necessary for Company or personnel to
obtain such clearances when applicable.
H-8 Confidentiality
During the performance of work under this Agreement, it may be
necessary to share and/or exchange information and data which may
be considered confidential, proprietary and/or competition
sensitive. Further, during performance of work under this
Agreement, the parties recognize that the presence of Company
personnel in Intergraph's and/or Government's facilities may
subject Company personnel to information and/or data that is
considered by Intergraph and/or Government to be confidential,
proprietary and/or competition sensitive. In addition, personnel
of Intergraph and/or the Government may have access to
information and/or data that is considered by Company to be
confidential, proprietary and/or competition sensitive.
Therefore, the parties agrees to the following:
(a) Any confidential, proprietary and/or competition sensitive
information exchanged by the parties and entitled to
protection hereunder shall be identified by the furnishing
party as confidential, proprietary and/or competition
sensitive by (i) appropriate stamp or marking on the
documents exchanged, or (ii) written notice of any
disclosures made under assertion of confidentiality, sent to
the receiving party no later than two (2) weeks after
disclosure, with listings of all proprietary material and
appropriately stamped or marked summaries of such other
disclosures.
(b) Verbal communications which are considered confidential,
proprietary and/or competition sensitive may also be
conducted as part of the normal discussion activities. Prior
to these verbal communications, an announcement will be made
that the conversation to follow is to be considered
confidential, proprietary and/or competition sensitive, and
at the conclusion of that part of the conversation that is
considered confidential, proprietary and/or competition
sensitive, an ending comment will be made so as to bracket
the information which is considered to be confidential. Both
parties agree to hold such verbal information in confidence
in accordance with this Agreement.
(c) The receiving party will hold such confidential, proprietary
and/or competition sensitive information in confidence for a
period of three (3) years from the date of receipt under this
Agreement, and during such period will use such information
only for evaluation purposes and will make such information
available only to its employees having a "need to know" in
order to carry out their functions in connection with the
purpose of this Agreement. Unless authorized in writing by
the party originally transmitting such confidential,
proprietary and/or competition sensitive information
hereunder, the receiving party will not otherwise use or
disclose such confidential, proprietary and/or competition
sensitive information during the above-mentioned three (3)
year period.
Information shall not be afforded the protection of this
Agreement if, on the effective date hereof, such information
has been or from the time thereafter such information is:
(1) lawfully developed by the receiving party independently
of the information received from furnishing party;
(2) rightfully obtained without restriction by the receiving
party from a third party;
(3) publicly available other than through the fault or
negligence of the receiving party;
(4) released without restriction by the furnishing party to
any third party.
(d) Should the receiving party be faced with legal action
regarding disclosure of information under this Agreement, the
receiving party shall forthwith notify the furnishing party,
and, upon the request and at the expense of the latter, shall
cooperate with the furnishing party in contesting such a
disclosure. Except in connection with failure to discharge
responsibilities set forth in the preceding sentence, neither
party shall be liable in damages for any disclosures pursuant
to judicial actions or for inadvertent disclosure where the
proper degree of care has been exercised; provided, that upon
discovery of such inadvertent disclosure, it shall have
endeavored to prevent any further inadvertent disclosure and
to correct the effects of any such inadvertent disclosure.
(e) All proprietary information furnished hereunder shall remain
the property of the furnishing party and shall be returned to
it or destroyed promptly at its request together with all
copies made thereof by the receiving party hereunder. The
parties shall employ the same standard of care it uses to
protect its own proprietary information, but in any event, no
less than reasonable care.
(f) No license under any patents or any other proprietary right
is granted or conveyed by one party's transmitting
proprietary information or other information to the other
party hereunder, nor shall such a transmission constitute any
representation, warranty, assurance, guaranty of inducement
by the transmitting party to the other party with respect to
infringement of patent or any other proprietary right of
others.
(g) The receiving party shall not disclose or deliver, directly
or indirectly, any technical data or any product utilizing
any such data to any person to whom such disclosure or
delivery is prohibited by the U.S. Government, nor export,
directly or indirectly, any technical data acquired pursuant
to this Agreement or any product utilizing any such data to
any country for which the U.S. Government or any agency
thereof at the time of export requires an export license or
other Government approval without first obtaining such
license or approval.
As a material part of this Agreement, the parties agree to make
known the provisions of this clause to each of their personnel
who are assigned to perform work under this Agreement and will
secure their agreement to comply.
H-9 Incorporation of Section K, "Representations, Certifications,
and Other Statements of Offerors"
Section K - Representations and Certifications is included as
EXHIBIT F to this Agreement.
H-10 Insurance - Work on a Government Installation
(a) In accordance with FAR 28.310-2, the Company shall at
its own expense, procure and maintain during the entire
performance period of this Agreement, insurance of at least
the kinds and minimum amounts set forth below:
Worker's Compensation and Employer's Liability Insurance $100,000
General Liability Insurance For Bodily
Injury Liability -- Minimum Per Occurrence $500,000
Automobile Liability Insurance
Minimum Per Person $200,000
Minimum Per Occurrence for
Bodily Injury $500,000
Minimum Per Occurrence for
Property Damage $ 20,000
(b) Prior to the commencement of work hereunder, upon
request, the Company shall furnish to Intergraph a
certificate or written statement confirming the existence of
the above required insurance. The policies evidencing
required insurance shall contain an endorsement to the
effect that cancellation or any material change in the
policies adversely affecting the interest of Intergraph
Corporation in such insurance shall not be effective for
such period as may be prescribed by the laws of the State in
which this Agreement is to be performed and in no event
less than thirty (30) days after written notice thereof to
Intergraph.
(c) The Company shall insert the substance of this clause,
including this paragraph (c), in all lower tier subcontracts
hereunder. The Company shall furnish (or ensure that there
has been furnished to Intergraph a current Certificate of
Insurance, meeting the requirements of (b) above, for each
such lower tier Subcontractor, at least five (5) days prior
to entry of each lower tier Subcontractor's personnel on the
Government Installation site.
H-11 Patent or Copyright Infringement and Indemnity
In consideration of Company's purchase of the Software and
Software Documentation from Intergraph under the Asset
Purchase Agreement, and the patent, copyright, trade secret
and other warranties and indemnities provided to Company
thereunder in respect to Software and Software
Documentation, and Company shall not provide any such
warranties or indemnities to Intergraph in respect to the
Software and Licensed Programs provided hereunder.
H-12 Term and Termination
(a) This Agreement will become effective upon its execution date
(the "Effective Date") and will extend for the Government's
ordering term under the Prime Contracts which shall not
extend beyond 12/31/2006 without mutual agreement of the
parties, unless terminated earlier as specified below.
Obligations in respect to Confidentiality (Section H-8)
shall survive any termination of this Agreement.
(b) Termination for Convenience - Company shall have the right
to terminate this Agreement for convenience at any time
after the Effective Date by providing Intergraph with at
least one hundred eighty (180) days prior written notice.
Company agrees that it will not terminate the availability
of Software (as identified in Exhibit A) and/or Software
maintenance services for convenience if Company intends to
generally continue licensing such Software and/or selling
such Software maintenance services to the general public.
If this Agreement is terminated by Company for convenience,
or, if this Agreement is terminated as a result of Company's
breach in accordance with H-12(e) or as a result of
Company's bankruptcy in accordance with H-12(f), then upon
termination, Company shall provide Intergraph with a
licensed copy of the source code of that portion of the
Software identified in Exhibit A that is proprietary to
Company including any and all documentation related to such
source code, and Intergraph may use such copy for continued
licensing and support of its obligations under the CAD-2
Programs. The portions of any license fees or maintenance
fees which may be payable to Company in association with any
continuing Software licensing or maintenance sales by
Intergraph under the CAD-2 Program shall be negotiated
between the parties at that time.
(c) Mutual Consent - This Agreement may be terminated at any
time by written agreement executed by both parties.
(d) In the event the Prime Contracts are terminated, this
Agreement shall be automatically terminated and Intergraph
shall notify Company promptly of such termination. Use of
Software licenses granted to Intergraph prior to the
effective date of termination, shall continue to be governed
by the terms of this Agreement and Intergraph shall continue
to meet its payment obligations to Company hereunder as set
forth in Purchase Orders effected prior to termination. The
Government's use of Software licenses granted shall be in
accordance with the terms of the Prime Contracts.
(e) Breach - If either party shall be in material breach of its
obligations herein and shall have failed or been unable to
commence to remedy such breach within thirty (30) days after
receipt of written notice from the other party specifying
such breach, said other party may terminate this Agreement
by giving written notice of termination.(See H-16.)
(f) Bankruptcy - If a receiver is appointed over the whole or
part of the assets of either party, or if any petition is
filed by or against either party initiating any bankruptcy
reorganization proceeding or if either party makes an
assignment for the benefit of creditors, or if any order is
made or resolution is adopted for the dissolution of either
party (unless such order or resolution is part of a scheme
of recapitalization, merger or consolidation) then such
party shall immediately notify the other party of such
event, and the other party may terminate this Agreement by
written notice thereof, effective upon the date of its
sending.
(g) Upon expiration or termination of this Agreement for any
reason, except for termination by Company for convenience in
accordance with H-12(b) above, or, except for termination by
Intergraph for Company breach (per H-12(e)) or bankruptcy
(per H-12(f)), Intergraph shall return to Company or
destroy, the Software and Software Documentation and all
copies and portions thereof, in any form whatsoever, and
shall erase from all computer, electronic, or other storage
devices or otherwise destroy all images or copies of same
and all portions that are in Intergraph's possession or
under its control, except as required to provide continuing
support of the then current copies which have been licensed
to the Government. Termination of this Agreement will not
effect any Government rights to use the Software and
Software Documentation which have been licensed up to that
time.
H-13 Limits of Agreement
(a) This Agreement relates to the Intergraph NAVAIR, NAVSEA and
NAVFAC CAD-2 Programs and in no way constitutes an
understanding or license to Intergraph with regard to any
other program or customers
(b) This Agreement is not intended to prejudice the Government
in any way with respect to actions it may take in
procurement on competitive bids nor shall this Agreement
constitute, create, give effect to, or imply a joint
venture, pooling arrangement, partnership, or business
organization of any kind between Intergraph and the Company
or with any other third party. Except as set forth in this
Agreement, neither party shall have any right to make
commitments of any kind for or on behalf of the other party,
without the prior written consent of the other party.
(c) This Agreement shall relate only to the Intergraph CAD-2
NAVAIR, NAVSEA and NAVFAC Programs and nothing herein shall:
(1) Confer any right to impose any obligation or
restriction on either party with respect to any other
effort or marketing activity at any time undertaken by
either party, jointly, or separately; and
(2) Limit the rights of either party to promote, market,
sell, lease or otherwise dispose of its standard
products, services, or training, to any other party
except where such would conflict with the obligations
or restrictions of the parties under this Agreement.
(d) Nothing herein is intended to affect the rights of the
Government to negotiate directly with either party hereto on
any basis that the Government may desire. It is understood
that Intergraph may be requested by the Government to place
requirements for product functionality or training
contemplated under this Agreement with another source for
products and/or services of a similar functionality, or to
request that Intergraph requirements be bid on a competitive
basis. In either of such cases, it is agreed that Intergraph
shall comply with the Government's request, and under such
circumstances, Intergraph shall have no obligation or
liability to Company for continued procurement of additional
products and services offered by Company hereunder, and
likewise, Company shall have no further obligation or
liability to Intergraph hereunder, except as regarding the
protection of data and/or information in accordance with the
Confidentiality obligations set forth in Article H-8.
(e) The parties acknowledge that the prices set forth in Exhibit
A are effective solely for the Software which consists of
Solid Edge Version 4.0 and shall not set a precedent for the
pricing of any software, maintenance, and/or training which
the parties may want to add to Exhibit A in the future. The
parties agree to negotiate in good faith to reach agreement
on the terms under which Company would provide licenses and
maintenance of subsequent new versions of Solid Edge to
Intergraph for the CAD-2 programs. The terms under which
licenses and maintenance of any new product will be provided
will be commercially reasonable. Any such products which
are purchased by Intergraph for use under the CAD-2 Programs
will be incorporated by written amendment to this Agreement
at mutually agreeable prices.
H-14 Assignment/Change of Control
This Agreement and any rights and obligations under this
Agreement shall not be assigned or transferred by operation
of law or otherwise by Intergraph without the prior written
approval of the other, which shall not be unreasonably
withheld.
H-15 Arbitration
If any dispute or difference as to the construction or
performance of this Agreement, or any matter or thing of
whatsoever nature arising hereunder or in connection
herewith (a "Dispute") shall arise between Company and
Intergraph, each party shall designate an individual with
ultimate authority for this Agreement who shall, if dispute
cannot be resolved by telephone, within ten (10) days of a
written request from either party to the other, meet in good
faith to seek a resolution without recourse to legal
proceedings. Any dispute not resolved pursuant to this
clause will be submitted to arbitration by a single
arbitrator mutually acceptable to the parties and
experienced in the computer software industry pursuant to
the commercial arbitration rules of the American Arbitration
Association, each party bearing its own arbitration fees and
costs (including filing fees), and each party bearing one-
half of the total arbitrator's fees of arbitration, the
arbitrator referencing the rules of evidence of the federal
rules of civil procedure then in effect in setting the
direction of the discovery process, and the parties hereto
shall accept the arbitration award as final and binding.
H-16 Notices
All notices required by or relating to this Agreement will
be in writing, as a document or in electronic form, and
deemed received when delivered in person, electronic mail,
facsimile, or sent postage prepaid via Express Mail, Federal
Express or other private courier, or United States certified
mail, return receipt requested, and will be sent to the
parties to this Agreement at the addresses specified below,
or to such other address as either party may substitute by
written notice to the other.
If to Company:
Unigraphics Solutions Inc.
13736 Riverport Drive
Maryland Heights, MO 63043-4826
Attn: Contracts, John J. Andrzejewski M/C 1163
Fax - (314) 344-5138
With a copy to:
Unigraphics Solutions Inc.
17D Intergraph Way
Madison, AL 35758
Attn: Bill McClure
Fax: (205) 730-1053
If to Intergraph:
Intergraph Corporation
289 Dunlop Boulevard
Huntsville, AL 35824
Attn: Contracts, Rod W. Thompson M/S IW1506
Fax:(205) 730-6248
With a copy to:
Intergraph Corporation
289 Dunlop Boulevard
Huntsville, AL 35824
Attn: Corporate Counsel
Fax: (205) 730-2247
H-17 Record Keeping and Audit
Intergraph shall keep, maintain and preserve for
at least two (2) years after the applicable transaction,
full and accurate accounts and records of all transactions
relating to the Software, Software Documentation and
services provided by Company under this Agreement,
examination of which would enable Company to verify
statements and payments issued by Intergraph and to confirm
Intergraph's compliance with the requirements of this
Agreement. Upon written request of Company, Intergraph
shall allow a public accounting firm acceptable to both
parties to have access to and inspect such books and records
(an "Audit"). Prior to the start of an audit, the third
party Certified Public Accountant must sign a non-disclosure
agreement to be provided by Intergraph. Such Audits may be
performed not more than once each year during regular
Intergraph business hours and the auditors shall complete
such inspection as expeditiously as possible. Intergraph
shall provide to the auditors such supplementary information
and explanation reasonably necessary to explain fully the
information contained in Intergraph's books, records and
accounts. The cost of the Audits shall be paid by Company
unless the Audit findings indicate errors in Intergraph
records which have resulted in underpayment of fees due to
Company of ten percent (10%) or more, in which case
Intergraph shall pay all of the fees and costs associated
with the Audit and the amount underpaid. If Intergraph has
overpaid fees due to Company, Company shall pay Intergraph
the amount of such overpayment. If requested by Intergraph,
Company shall make the results of any such audit available
to Intergraph.
H-18.Construction Rules
(a) Headings
Article headings are included for convenience only and are
not to be used to construe or interpret this Agreement.
(b) Enforceability
If any provision of this Agreement is held to be invalid,
illegal or unenforceable, the validity, legality and
enforceability of the remaining provisions will not in any
way be affected or impaired, and such provision will be
deemed to be restated to reflect the original intentions of
the parties as nearly as possible in accordance with
applicable law.
Section I - Contract Clauses
This Agreement incorporates the following FAR clauses by
reference, with the same force and effect as if they were given
in full text. For the purposes of this Section I, the FAR clause
references to the "Government" shall mean Intergraph and to
"Prime Contractor" shall mean Company.
Clause Number Clause Title and Date
- ------------- ---------------------
52.202-1 DEFINITIONS (APR 1984)
52.203-1 OFFICIALS NOT TO BENEFIT (APR 1984)
52.203-3 GRATUITIES (APR 1984)
52.203-5 COVENANT AGAINST CONTINGENT FEES (APR 1984)
52.203-6 RESTRICTIONS ON SUBCONTRACTORS SALES TO THE
GOVERNMENT (JUL 1985)
52.203-7 ANTI-KICKBACK PROCEDURES (OCT 1988)
52.222-26 EQUAL OPPORTUNITY (APR 1984)
52.222-35 AFFIRMATIVE ACTION FOR SPECIAL DISABLED AND
VIETNAM ERA VETERANS (APR 1984)
52.222-36 AFFIRMATIVE ACTION FOR HANDICAPPED WORKERS (APR
1984)
52.222-37 EMPLOYMENT REPORTS ON SPECIAL DISABLED VETERANS
AND VETERANS OF THE VIETNAM ERA (JAN 1988)
52.227-2 NOTICE AND ASSISTANCE REGARDING PATENT AND
COPYRIGHT INFRINGEMENT (APR 1984)
52.227-19 COMMERCIAL COMPUTER SOFTWARE - RESTRICTED RIGHTS
(JUN 1987)
52.249-2 TERMINATION FOR CONVENIENCE OF THE GOVERNMENT
(FIXED PRICE) APRIL 1984) (THIS CLAUSE TO APPLY ONLY
IF THE GOVERNMENT CANCELS ORDERS ISSUED TO
INTERGRAPH)
252.227-7013 RIGHTS IN TECHNICAL DATA AND COMPUTER
SOFTWARE (OCT 1988)
252.227-7018 RESTRICTIVE MARKINGS ON TECHNICAL DATA (OCT
1988)
252.227-7019 IDENTIFICATION OF RESTRICTED RIGHTS COMPUTER
SOFTWARE (APR 1988)
252.227-7028 REQUIREMENT FOR TECHNICAL DATA REPRESENTATION
(OCT 1988)
252.227-7029 IDENTIFICATION OF TECHNICAL DATA (APR 1988)
252.227-7030 TECHNICAL DATA - WITHHOLDING OF PAYMENT (OCT
1988)
252.227-7031 DATA REQUIREMENTS (OCT 1988)
252.227-7036 CERTIFICATION OF TECHNICAL DATA CONFORMITY
(MAY 1987)
252.227-7037 VALIDATION OF RESTRICTIVE MARKINGS ON
TECHNICAL DATA (APR 1988)
Section J - Entire Agreement
This Agreement (including the attached EXHIBITS as identified
below) constitutes the entire Agreement between the parties
relating to the subject matter hereof and supersedes all
proposals or prior agreements, oral or written, and all other
communications between the parties relating thereto. Amendments
and supplements to this Agreement must be in writing signed by
authorized representatives of the parties. THIS AGREEMENT SHALL
BE CONSTRUED IN ACCORDANCE WITH, AND ITS PERFORMANCE GOVERNED BY
THE INTERNAL LAWS OF THE STATE OF DELAWARE EXCLUDING ITS LAWS ON
CONFLICT OF LAW. Those matters which are included in the
Agreement based upon federal regulation shall be governed by
federal government contract case law.
EXHIBIT "A" - Software, Maintenance, and Training/Fees
EXHIBIT "B" - Software Documentation List
EXHIBIT "C" - Software Maintenance and Support
EXHIBIT "D" - Training
EXHIBIT "E" - Documentation
EXHIBIT "F" - "Section K - Representations,
Certifications and Other Statements of Offerors"
IN WITNESS WHEREOF, THE PARTIES HERETO HAVE CAUSED THIS
AGREEMENT, TO BE DULY EXECUTED AS OF THE DAY AND YEAR FIRST ABOVE WRITTEN.
UNIGRAPHICS SOLUTIONS INC. INTERGRAPH CORPORATION
By: /s/ H. Timothy Hatfield By: /s/ John W. Wilhoite
------------------------- -----------------------
Name: H. Timothy Hatfield Name: John W. Wilhoite
Title: Vice President Title: Vice President
Date: March 2, 1998 Date: March 2, 1998
<TABLE>
EXHIBIT A
SOFTWARE, MAINTENANCE, AND TRAINING/FEES
MARCH 1, 1998
<CAPTION>
1998 1998 1999<F1> 1999 2000<F1> 2000
Intergraph Prime Description Prime USI Prime USI Prime USI
Part Number Contract CLIN Contract Price to Contract Price to Contract Price to
Price INGR GFY Price INGR GFY Price INGR GFY
GFY GFY GFY
1998 1998 1999 1999 2000 2000
<S> <C> <C> <C> <C> <C> <C> <C> <C>
NAVSEA
SM**289 S008NBA SOLIDEDGE V4 FOR $2,058 $2,058 $1,998 $1,998 NA NA
WINDOWS NT
SM**289 S008NBAM FULL SOFTWARE $54 $43 $32 $26 $32 $26
MAINTENANCE--
MONTHLY Note:
Maintenance -
for GFY 1999-
2003is Phone
Support Only
TMCH1413 T001AA Solid Edge $740 $592 $720 $576 $720 $576
(Generic CLIN Fundamentals per
One Day-- Enrollment at
Contractor's Unigraphics
Site) Facility
(4 day course)
TMCH1413 T001BA Solid Edge $5,808 $4,646 $5,640 $4,512 $5,640 $4,512
(Generic CLIN Fundamentals On-
One Day-- Site at
Gov't. Site) Government
Facility
with Limit of
12 Students,
Plus Instructor
Airfare Only.
(4 day course)
TMCH1402 T001AA Solid Edge $555 $444 $540 $432 $540 $432
(Generic CLIN Customization
One Day-- Using Visual
Contractor's Basic per
Site) Enrollment at
Unigraphics
Facility (3 day
course)
TMCH1402 T001BA Solid Edge $4,356 $3,485 $4,230 $3,384 $4,230 $3,384
Generic Customization
One Day -- Using Visual
Gov't Site) Basic On-Site at
Government
Facility with
Limit of 12
Students, Plus
Instructor
Airfare Only.
(3 day course)
NAVAIR
SM**289 21AE11 SOLIDEDGE V4 FOR $2,058 $2,058 $2,398 $2,398 $2,398 $2,398
WINDOWS NT
SM**289 21AE11S FULL SOFTWARE $54 $43 $54 $43 $54 $43
MAINTENANCE--
MONTHLY
TMCH1413 27CJ01 (Generic Solid Edge $740 $592 $720 $576 $720 $576
CLIN One Day-- Fundamentals
Contractor's per Enrollment
Site) at Unigraphics
Facility
(4 day course)
TMCH1413 26CJ01 (Generic Solid Edge $5,076 $4,061 $4,928 $3,942 $4,928 $3,942
CLIN One Day-- On-Site at
Gov't Site) Government
Facility with
Limit of 12
Students, Plus
Instructor
Airfare Only.
(4 day course)
TMCH1402 27CJ01 (Generic Solid Edge $555 $444 $540 $432 $540 $432
CLIN One Day-- Customization
Contractor's Using Visual
Site) Basic per
Enrollment at
Unigraphics
Facility
(3 day course)
TMCH1402 26CJ01 (Generic Solid Edge $3,807 $3,046 $3,696 $2,957 $3,696 $2,957
CLIN One Day-- Customization
Gov't. Site) Using Visual
Basic On-Site
at Government
Facility
with Limit of 12
Students, Plus
Instructor
Airfare Only.
(3 day course)
<FN>
<F1> Prime Contract Price is Subject to Adjustment (Downward Only) at Time of
Prime Contract Renewal. Adjustment is a Function of the then Current Vendor
List Price for the Product or Service. That is, the prices payable to Company
for the Products and Services identified in this Exhibit A are subject to
adjustment only to the extent that Company's standard list prices for such
products and Services have been reduced at the time of prime Contract renewal.
For Solid Edge Version 4 only, the Intent of the Parties is that the USI Price
to Intergraph is 100% of the Prime Contract Price for the Software and 80% of
the Prime Contract Price for the Software Maintenance and Training.
</FN>
</TABLE>
<TABLE>
EXHIBIT A
SOFTWARE, MAINTENANCE, AND TRAINING/FEES
MARCH 1, 1998
<CAPTION>
2001<F1> 2001 2002<F1> 2002 2003<F1> 2003
Intergraph Prime Description Prime USI Prime USI Prime USI
Part Number Contract CLIN Contract Price to Contract Price Contract Price to
Price INGR GFY Price INGR GFY Price INGR GFY
2001 2001 2002 2002 2002 2002
<S> <C> <C> <C> <C> <C> <C> <C> <C>
NAVSEA
SM**289 S008NBA SOLIDEDGE V4 FOR NA NA NA NA NA NA
WINDOWS NT
SM**289 S008NBAM FULL SOFTWARE $32 $26 $32 $26 $32 $26
MAINTENANCE--
MONTHLY Note:
Maintenance -
for GFY 1999-2003
is Phone Support
Only
TMCH1413 T001AA Solid Edge $720 $576 $720 $576 $720 $576
(Generic CLIN Fundamentals per
One Day-- Enrollment at
Contractor's Unigraphics
Site) Facility
(4 day course)
TMCH1413 T001BA Solid Edge $5,640 $4,512 $5,640 $4,512 $5,640 $4,512
(Generic CLIN Fundamentals On-
One Day-- Site at
Gov't. Site) Government
Facility
with Limit of
12 Students, Plus
Instructor Airfare
Only.(4day course)
TMCH1402 T001AA Solid Edge $540 $432 $540 $432 $540 $432
(Generic CLIN Customization
One Day-- Using Visual
Contractor's Basic per
Site) Enrollment at
Unigraphics
Facility (3 day
course)
TMCH1402 T001BA Solid Edge $4,320 $3,384 $4,230 $3,384 $4,230 $3,384
(Generic CLIN Customization
One Day -- Using Visual
Gov't. Site) Basic On-Site
at Government
Facility with
Limit of 12
Students, Plus
Instructor
Airfare
Only. (3 day course)
NAVAIR
SM**289 21AE11 SOLIDEDGE V4 FOR $2,398 $2,398 $2,398 $2,398 NA NA
WINDOWS NT
SM**289 21AE11S FULL SOFTWARE $54 $43 $54 $43 $54 $43
MAINTENANCE--
MONTHLY
TMCH1413 27CJ01 Solid Edge $720 $576 $720 $576 $720 $576
(Generic Fundamentals
CLIN One Day-- per Enrollment at
Contractor's Unigraphics
Site) Facility
(4 day course)
TMCH1413 26CJ01 Solid Edge $4,928 $3,942 $4,928 $3,942 $4,928 $3,942
(Generic Fundamentals
CLIN One Day-- On-Site at Government
Gov't. Site) Facility with Limit of
12 Students, Plus
Instructor Airfare Only.
(4 day course)
TMCH1402 27CJ01 Solid Edge $540 $432 $540 $432 $540 $432
(Generic CLIN Customization Using
One Day-- Visual Basic per
Contractor's Enrollment at
Site) Unigraphics
Facility
(3 day course)
TMCH1402 26CJ01 Solid Edge $3,696 $2,957 $3,696 $2,957 $3,696 $2,957
Generic CLIN Customization Using
One Day -- Visual Basic
Gov't Site) On-Site at
Government
Facility
with Limit of 12
Students, Plus
Instructor Airfare
Only.
(3 day course)
<FN>
<F1>Prime Contract Price is Subject to Adjustment (Downward Only) at Time of
Prime Contract Renewal. Adjustment is a Function of the then Current Vendor List
Price for the Products or Service. That is, the prices payable to Company for the
Products and Services identified in this Exhibit A are subject to adjustment only
to the extent that Company's standard list prices for such products and Services
have been reduced at the time of prime Contract renewal. For Solid Edge Version
4 only, the Intent of the Parties is that the USI Price to Intergraph is 100% of
the Prime Contract Price for the Software and 80% of the Prime Contract Price for
the Software Maintenance and Training.
</FN>
</TABLE>
<TABLE>
EXHIBIT A
SOFTWARE, MAINTENANCE, AND TRAINING/FEES
MARCH 1, 1998
<CAPTION>
2004<F1> 2004 2005<F1> 2005 2006<F1> 2006
Intergraph Prime Description Prime USI Prime USI Prime USI
Part Number Contract CLIN Contract Price to Contract Price to Contract Price to
Price GFY INGR GFY Price GFY INGR GFY Price GFY INGR GFY
2004 2004 2005 2005 2006 2006
<S> <C> <C> <C> <C> <C> <C> <C> <C>
NAVSEA
SM**289 S008NBA SOLIDEDGE V4 FOR NA NA NA NA NA NA
WINDOWS NT
SM**289 S008NBAM FULL SOFTWARE NA NA NA NA NA NA
MAINTENANCE--
MONTHLY Note:
Maintenance -
for GFY 1999-2003
is Phone Support
Only
TMCH1413 T001AA Solid Edge NA NA NA NA NA NA
(Generic CLIN Fundamentals per
One Day-- Enrollment at
Contractor's Unigraphics
Site) Facility
(4 day course)
TMCH1413 T001BA Solid Edge NA NA NA NA NA NA
(Generic CLIN Fundamentals On-
One Day-- Site at
Gov't. Site) Government
Facility
with Limit of
12 Students, Plus
Instructor Airfare
Only.(4day course)
TMCH1402 T001AA Solid Edge NA NA NA NA NA NA
(Generic CLIN Customization
One Day-- Using Visual
Contractor's Basic per
Site) Enrollment at
Unigraphics
Facility (3 day
course)
TMCH1402 T001BA (Generic Solid Edge NA NA NA NA NA NA
CLIN One Day-- Customization
Gov't. Site) Using Visual
Basic On-
Site at
Government
Facility with
Limit of 12
Students, Plus
Instructor
Airfare Only.
(3 day course)
NAVAIR
SM**289 21AE11 SOLIDEDGE V4 FOR NA NA NA NA NA NA
WINDOWS NT
SM**289 21AE11S FULL SOFTWARE $54 $43 $54 $43 $54 $43
MAINTENANCE--
MONTHLY
TMCH1413 27CJ01(Generic Solid Edge $720 $576 $720 $576 $720 $576
CLIN One Day-- Fundamentals
Contractor's per Enrollment at
Site) Unigraphics
Facility
(4 day course)
TMCH1413 26CJ01(Generic Solid Edge $4,928 $3,942 $4,928 $3,942 $4,928 $3,942
CLIN One Day-- Fundamentals
Gov't Site) On-Site at
Government
Facility with
Limit of
12 Students, Plus
Instructor Airfare
Only.
(4 day course)
TMCH1402 27CJ01(Generic Solid Edge $540 $432 $540 $432 $540 $432
CLIN One Day-- Customization
Contractor's Using Visual Basic
Site) per Enrollment at
Unigraphics
Facility
(3 day course)
TMCH1402 26CJ01(Generic Solid Edge $3,696 $2,957 $3,696 $2,957 $3,696 $2,957
CLIN One Day-- Customization
Gov't. Site) Using Visual Basic
On-Site at
Government
Facility
with Limit of 12
Students, Plus
Instructor Airfare
Only.
(3 day course)
<FN>
<F1>Prime Contract Price is Subject to Adjustment (Downward Only) at Time of
Prime Contract Renewal. Adjustment is a Function of the then Current Vendor List
Price for the Product or Service. That is, the prices payable to Company for the
Products and Services identified in this Exhibit A are subject to adjustment
only to the extent that Company's standard list prices for such products and
Services have been reduced at the time of prime Contract renewal. For Solid
Edge Version 4 only, the Intent of the Parties is that the USI Price to
Intergraph is 100% of the Prime Contract Price for the Software and 80% of the
Prime Contract Price for the Software Maintenance and Training.
</FN>
</TABLE>
EXHIBIT B
SOFTWARE DOCUMENTATION LIST
The standard Software Documentation provided with the Software
will consist of the Solid User's Guide-Version 4.
EXHIBIT C
SOFTWARE MAINTENANCE AND SUPPORT
1. General Maintenance Responsibilities
During the term of this Agreement, maintenance
responsibilities to CAD-2 Program Users shall consist of the
following:
a) Intergraph will place the Software in Intergraph's
software delivery program and will be responsible
for distribution to Intergraph's CAD-2 Program
Users.
b) Intergraph will enter into software maintenance
contracts with Intergraph's CAD-2 Program Users.
c) Company will take all initial support calls from
Intergraph's CAD-2 Program Users.
d) Company will consolidate problems/errors reported
to be in the Software.
e) Company will provide all fixes, patches and work-
arounds to CAD-2 Program Users (except to the
extent otherwise provided in the Primary Reseller
Agreement with respect to the Retained STI Rights)
which it provides to its commercial customers;
provided, however, if Company does not provide a
fix required by the CAD-2 Programs, then such
event, at Intergraph's sole discretion, shall be
deemed to be an event of termination for
convenience by Company pursuant to Section H-12(b)
hereof and Company shall provide Intergraph with a
licensed copy of the source code of that portion of
the Software identified in Exhibit A as required by
such Section H-12(b).
2. Software Maintenance Description
Software maintenance will be provided to Intergraph during
the hours of 7:00a.m. and 7:00p.m. Central Standard Time,
Monday through Friday, excluding Company-observed holidays.
Software maintenance will include and be limited to the
following for all Software products:
a) Telephone support line service which provides
Software maintenance requests answered by Company
support personnel for Software specific technical
needs and problems.
b) Bulletin board service which will allow Intergraph
to electronically log Software support requests,
download Software fixes or fix release notes and
access product information.
Maintenance services are limited to the Software identified
in Exhibit A functioning on the appropriate Company
supported operating system.
Company will provide upgrades to the Software if and when
made available by Company for which maintenance has been
purchased. Upgrade(s) refers to subsequent releases (if
any) to the Solid Edge Version 4 Software products covered
under the Agreement.
3. General
Company agrees to consider any reasonable Intergraph request
for support in addition to that specified above and if
agreed, charges to be paid by Intergraph will be standard
Company time and material rates less a mutually acceptable
discount.
Company represents that the maintenance services provided to
Intergraph will be at least comparable to the maintenance
provided by Company on a standard commercial basis.
EXHIBIT "D"
TRAINING
TRAINING GENERAL REQUIREMENTS
The purpose of the training is to enable users to learn how to
effectively use the Software products to help them perform varied
tasks. Courses to be developed and provided shall be aimed at
increasing the quality of their weapon systems, and support
facilities. Cost effectiveness, logical presentation of material,
proper sequencing of courses and timeliness of offering shall
receive considerable attention in the entire training program.
Examples and exercises in all the modes of course presentation
shall be based on actual projects related to the Software
products.
The Company shall provide training, as ordered, to end user
personnel and sites who acquire Software products from Intergraph
under this Agreement. The end users can order formal classroom
on-site and off-site training from Intergraph as provided for
herein.
PRICING CONDITIONS
Prices for off-site (at Company's location) formal classroom
training shall be on the basis of a per student price and shall
include all training materials, instructor's fees, Company's
travel and per diem, and any other associated costs.
NAVFAC and NAVAIR/SPAWAR CAD-2 prices for on-site (Government's
location) formal classroom training shall be on the basis of a
per class price and shall include training material, instructor's
fees, and any other associated costs. Travel and per diem shall
be reimbursable in accordance with the DOD Civilian Personnel
Joint Travel Regulation.
NAVSEA CAD-2 prices for on-site (Government's location) formal
classroom training shall be on the basis of a per course price
and shall include training material, instructor's fees, Company
instructor's travel and per diem, except air fares, and any
other associated costs. Air fare shall be reimbursable in
accordance with the DOD Civilian Personnel Joint Travel
Regulation.
INSTRUCTOR QUALIFICATIONS
The instructors who teach the drafting and modeling features
shall have training in engineering graphics theory and practice.
This foundation shall be related to mechanical, electrical, and
architectural engineering, depending upon the specific courses to
be taught. The instructors who teach the application features
shall have technical training for application they are
presenting.
This training shall be a Bachelor's degree or equivalent teaching
experience related to the application area. The instructors who
teach the more advanced application features shall possess
training and experience commensurate with the subject material
being taught.
The Company shall submit resumes of instructors accompanied with
a list of courses they are qualified to teach upon Intergraph's
request within thirty (30) days.
TRAINING MATERIALS
For all modes of training, the Company shall provide each student
with complete, well-organized, training and reference materials
current with the end user requesting site's software. All modes
of training shall be prefaced by a statement of the applicable
Software version and release annotation, course objectives,
course topics and subtopics, major concepts and skills to be
learned. The Company shall use examples and laboratory exercises
based on actual projects related to the application Software.
For each course, the Company shall submit a course syllabus and
one (1) copy of all training materials to Intergraph. Course
outlines, proposed training and reference manuals shall be
submitted to Intergraph for approval at least three months prior
to first scheduled course if desired schedules permit.
Intergraph or a selected representative from the Government may
audit the first offering of every course before it is presented
to the rest of the Government user community. This person or
group will make recommendations, if necessary, and the Company
shall use reasonable effort to incorporate the changes in their
subsequent offerings and respective training materials.
The Government may make a reasonable number of copies of all
training documentation submitted as is required to enable the
students trained to properly use the licensed Software. All such
materials shall remain the property of Company. The copies made
will be for internal use only.
TRAINING LOCATIONS
Intergraph may order training to be conducted at the following
types of facilities:
1. At any Government facility (on-site training). The Government
shall be responsible for providing facilities and equipment for
on-site training.
2. At any of the Company's Education Centers or other Company-
chosen training sites (off-site training).
SCHEDULING OF CLASSES
The Company shall submit a proposed training schedule on
Intergraph's written request every six (6) months, starting three
(3) months prior to the first course offered under this
Agreement. The training schedule shall identify type of training,
number of students, course location, duration of training and
recommended lead time for purchasing such course participation to
assure open seats.
All on-site training provided under this Agreement shall be
scheduled through the Intergraph Agreement administrator and
shall be by mutual agreement of the parties concerned, however
Company will use reasonable efforts to deliver training no less
than 60 days from receipt of a purchase order.
The Company shall use reasonable efforts to assure the
availability of instructors and materials to support the
simultaneous conducting of on-site training courses, within 60
days after execution of this Agreement.
NUMBER OF STUDENTS PER CLASS
For formal on-site and off-site classroom training that requires
the use of workstations, the maximum number of students per
workstation shall be two (2) and the maximum number of students
per class shall be up to twelve (12) students. There shall be no
maximum number of participants/attendees for overviews as long as
the Government site can provide adequate facilities for such
classes.
SOFTWARE REVISION
All modes of training shall be updated to the Solid Edge V-4
revision of Software and shall be available with the delivery of
that Software version.
DISRUPTION OF CLASSES
Formal onsite classroom training courses may be disrupted if the
classroom presentation is reasonably deemed by objective
circumstances to be substandard (e.g., instructor is not
adequately prepared; severe weather conditions warrant the
closure of the facility where the class is being held, similar
conditions make the Company's Training Facility inaccessible to
the students and the instructor; or the system is having
excessive downtime) in which case the class shall be rescheduled.
Disruption of classes for any reason shall be reported
immediately to Intergraph and shall be handled on a case-by-case
basis. Company shall be reimbursed by Intergraph for travel and
living expenses incurred by Company personnel in association with
such disrupted classes unless their disruption was caused solely
by Company personnel.
COURSE DESCRIPTIONS
1. TMCH 1413
Solid Edge Fundamentals
Description:
Building an associative assembly model, you'll create and edit
parts, and place and edit features. You also get an overview of
Solid Edge data management that covers file search, design
status, revision control, and properties. Other topics in this
course include part relationships, assembly concepts and
workflow, sheetmetal design, and input/output of foreign data to
and from Solid Edge. You will learn to compose drawings from a 3D
part or assembly model. The drawings you create contain various
views, sections, details, dimensions, notes and annotations. You
will make design changes by changing both the part model and the
drawing. Also you will see how making changes relates to the
assembly or drawing status.
Prerequisites:
Completion of the Educational Media Tutorials delivered with
Solid Edge, Microsoft Windows training
TMCH 1402
Solid Edge Customization Using Visual Basic
Description:
In this course you'll learn to customize objects unique to SOLID
EDGE -- similar to customization tools in Microsoft Excel. This
course combines such topics as SOLID EDGE, OLE, and Visual Basic,
extensions (example: exe, dll, ocx), and creation of
applications. The course also includes sample programs for
customizing SOLID EDGE.
Prerequisites:
Windows training, Visual Basic training, SOLID EDGE
experience
EXHIBIT "E"
SOFTWARE DOCUMENTATION
DOCUMENTATION DEFINITION
For the purpose of this specification, documentation ("Software
Documentation") is defined as all materials in whatever form,
delivered to Intergraph for use at a Government site or used at
any training location, that convey information about the
Software. This includes standard written documentation, on-line
documentation, and usage instructions.
SCOPE OF DOCUMENTATION
a. Software Documentation shall include all areas of the
application Software so as to enable users to learn, operate
and fully utilize the application Software.
b. Software Documentation shall be provided in accordance with
best commercial practices.
c. Software Documentation costs shall be included in the price
of the Software license.
DOCUMENTATION REQUIREMENTS
a. Software Documentation which continues to meet the above
definition and scope as Software changes occur shall be
furnished during the entire term of this Agreement.
b. Software Documentation shall be provided:
1. Concurrent with modifications to Software (if any)
2. When new Software are delivered (if any).
c. The Government end user shall have the right to make six (6)
copies of each Software Documentation delivered under this
Agreement. These copies are in addition to the archive and
backup copies authorized under the "Rights in Data and Computer
Software" clause. The copies made will be for internal use.
EXHIBIT "F"
"SECTION K - REPRESENTATIONS, CERTIFICATIONS AND
OTHER STATEMENTS OF OFFERORS"
ATTACHMENT F
SECTION K - REPRESENTATIONS , CERTIFICATIONS, AND OTHER
STATEMENTS OF BIDDERS
SECTION I
K-1. TAXPAYER IDENTIFICATION (SEP 1992) (FAR 52.204-3)
(a) Definitions.
"Common parent," as used in this solicitation provision,
means that corporate entity that owns or controls an affiliated
group of corporations that files its Federal income tax returns
on a consolidated basis, and of which the offeror is a member.
"Corporate status," as used in this solicitation provision,
means a designation as to whether the offeror is a corporate
entity, an unincorporated entity (e.g., sole proprietorship or
partnership), or a corporation providing medical and health care
services.
"Taxpayer Identification Number (TIN)," as used in this
solicitation provision, means the number required by the IRS to
be used by the offeror in reporting income tax and other returns.
(b) All offerors are required to submit the information
required in paragraphs (c) through (e) of this solicitation
provision in order to comply with reporting requirements of 26
U.S.C. 6041, 6041A, and 6050M and implementing regulations issued
by the Internal Revenue Service (IRS). If the resulting contract
is subject to reporting requirements described in FAR 4.903, the
failure or refusal by the offeror to furnish the information may
result in a 20 percent reduction of payments otherwise due under
the contract.
(c) Taxpayer Identification Number (TIN).
(X ) TIN: 75-2728894
( ) TIN has been applied for.
( ) TIN is not required because:
( ) Offeror is a nonresident alien, foreign
corporation, or foreign partnership that does not have income
effectively connected with the conduct of a trade or business in
the U.S. and does not have an office or place of business or a
fiscal paying agent in the U.S.;
F:\groups\cld\andy\ugigcer2.doc\021698
( ) Offeror is an agency or instrumentality of a
foreign government;
( ) Offeror is an agency or instrumentality of a
Federal, state, or local government;
( ) Other. State basis.
(d) Corporate Status.
( ) Corporation providing medical and health care
services, or engaged in the billing and collecting of payments
for such services;
(x ) Other corporate entity;
( ) Not a corporate entity;
( ) Sole proprietorship
( ) Partnership
( ) Hospital or extended care facility described in 26
CFR 501(c)(3) that is exempt from taxation under 26 CFR 501(a).
(e) Common Parent.
( ) Offeror is not owned or controlled by a common
parent as defined in paragraph (a) of this clause.
(x ) Name and TIN of common parent:
Name ELECTRONIC DATA SYSTEMS CORPORATION
TIN 75-2548221
K-2.CERTIFICATION REGARDING DEBARMENT, SUSPENSION, PROPOSED
DEBARMENT, AND OTHER RESPONSIBILITY MATTERS
(MAY 1989) (FAR 52.209-5)
(a)(1) The Offeror certifies, to the best of its
knowledge and belief, that --
(i) The Offeror and/or any of its Principals --
(A) Are ( ) are not (X ) presently debarred,
suspended, proposed for debarment, or declared ineligible for the
award of contracts by any Federal agency;
(B) Have ( ) have not (X ), within a three-year
period preceding this offer, been convicted of or had a civil
judgment rendered against them for: commission of fraud or a
criminal offense in connection with obtaining, attempting to
obtain, or performing a public (Federal, state, or local)
contract or subcontract; violation of Federal or state antitrust
statutes relating to the submission of offers; or commission of
embezzlement, theft, forgery, bribery, falsification or
destruction of records, making false statements, or receiving
stolen property; and
(C) Are ( ) are not (X ) presently indicted for,
or otherwise criminally or civilly charged by a governmental
entity with, commission of any of the offenses enumerated in
subdivision (a)(1)(i)(B) of this provision.
(ii) The Offeror has ( ) has not (X ), within a three-
year period preceding this offer, had one or more contracts
terminated for default by any Federal agency.
(2) "Principals," for the purposes of this certification,
means officer; director; owners; partners; and, persons having
primary management or supervisory responsibilities within a
business entity (e.g., general manager; plant manager; head of a
subsidiary, division, or business segment, and similar
positions).
This certification concerns a matter within the jurisdiction
of an agency of the United States and the making of a false,
fictitious, or fraudulent certification may render the maker
subject to prosecution under section 1001, title 18, United
States Code.
(b) The Offeror shall provide immediate written notice to
the Contracting Officer if, at any time prior to contract award,
the Offeror learns that its certification was erroneous when
submitted or has become erroneous by reason of changed
circumstances.
(c) A certification that any of the items in paragraph (a)
of this provision exists will not necessarily result in
withholding of an award under this solicitation. However, the
certification will be considered in connection with a
determination of the Offeror's responsibility. Failure of the
Offeror to furnish a certification or provide such additional
information as requested by the Contracting Officer may render
the Offeror nonresponsible.
(d) Nothing contained in the forgoing shall be construed to
require establishment of a system of records in order to render,
in good faith, the certification required by paragraph (a) of
this provision. The knowledge and information of an Offeror is
not required to exceed that which is normally possessed by a
prudent person in the ordinary course of business dealings.
(e) The certification in paragraph (a) of this provision is
a material representation of fact upon which reliance was placed
when making award. If it is later determined that the Offeror
knowingly rendered an erroneous certification, in addition to the
other remedies available to the Government, the Contracting
Officer may terminate the contract resulting from this
solicitation for default.
K-3.TYPE OF BUSINESS ORGANIZATION (JUL 1987) (FAR 52.215-6)
The offeror or quoter, by checking the applicable box,
represents that --
(a) It operates as [X ] a corporation incorporated under
the laws of the State of DELAWARE , [ ] an
individual, [ ] a partnership, [ ] a nonprofit organization, or
[ ] a joint venture.
(b) If the offeror or quoter is a foreign entity, it
operates as [ ] an individual, [ ] a partnership, [ ] a
nonprofit organization, [ ] a joint venture, or [ ] a
corporation, registered for business in
(country).
K-4. AUTHORIZED NEGOTIATORS (APR 1984) (FAR 52.215-11)
The offeror or quoter represents that the following persons
are authorized to negotiate on its behalf with the Government in
connection with this request for proposals or quotations: (list
names, titles, and telephone numbers of the authorized
negotiators).
Name (1) JOHN J. ANDRZEJEWSKI (2) ED ARLIN
Title (1) CONTRACTS MANAGER (2) DISTRICT SALES MANAGER
Telephone Number (1) (314) 344-8254 (2) (860) 632-6590
K-5. PLACE OF PERFORMANCE (APR 1984) (FAR 52.215-20)
(a) The offeror or quoter, in the performance of any
contract resulting from this solicitation, [ ] intends, [ X] does
not intend (check applicable block) to use one or more plants or
facilities located at a different address from the address of the
offeror or quoter as indicated in this proposal or quotation.
(b) If the offeror or quoter checks "intends" in paragraph
(a) above, it shall insert in the spaces provided below the
required information:
Place of Performance Name and Address of Owner
(Street Address, City, County, and Operator of the Plant
State, Zip Code) or Facility if Other Than Offeror or Quoter
NOT APPLICABLE
K-6. SMALL BUSINESS PROGRAM REPRESENTATIONS
(OCT 1995) (FAR 52.219-1)
(a) (1) The standard industrial classification (SIC) code
for this acquisition is (insert SIC code).
(2) The small business size standard is
(insert size standard).
(3) The small business size standard for a
concern which submits an offer in its own name, other than on a
construction or service contract, but which proposes to furnish a
product which it did not itself manufacture, is 500 employees.
(b) Representations. (1) The offeror represents and
certifies as part of its offer that it { ] is, [ X ] is not
a small business concern.
(2) (Complete only if offeror represented itself
as a small business concern in block (b)(1) of this section.)
The offeror represents as part of its offer that it [ ] is, [ ]
is not a small disadvantaged business concern.
(3) (Complete only if offeror represented itself as a
small business in block (b)(1) of this section.) The offeror
represents as part of its offer that it [ ] is, [ ] is not a
women-owned small business concern.
(c) Definitions.
Small business concern, as used in this provision, means a
concern, including its affiliates, that is independently owned
and operated, not dominant in the field of operation in which it
is bidding on Government contracts, and qualified as a small
business under the criteria in 13 CFR Part 121 and the size
standards in paragraph (a) of this provision.
Small disadvantaged business concern, as used in this
provision, means a small business concern that (1) is at least 51
percent unconditionally owned by one or more individuals who are
both socially and economically disadvantaged, or a publicly owned
business having at least 51 percent of its stock unconditionally
owned by one or more socially and economically disadvantaged
individuals and (2) has its management and daily business
controlled by one or more such individuals. This term also means
a small business concern that is at least 51 percent
unconditionally owned by an economically disadvantaged Indian
tribe or Native Hawaiian Organization, or a publicly owned
business having at least 51 percent of its stock unconditionally
owned by one of these entities, which has its management and
daily business controlled by members of an economically
disadvantaged Indian tribe or Native Hawaiian Organization, and
which meets the requirements of 13 CFR 124.
Women-owned small business concern, as used in this
provision, means a small business concern (1) which is at least
51 percent owned by one or more women or, in the case of any
publicly owned business, at least 51 percent of the stock of
which is owned by one or more women, and (2) whose management and
daily operations are controlled by one or more women.
(d) Notice. (1) If this solicitation is for supplies and has
been set aside, in whole or in part, for small business concerns,
then the clause in this solicitation providing notice of the set-
aside contains restrictions on the source of the end items to be
furnished.
(2) Under 15 U.S.C. 645(d), any person who misrepresents a
firm's status as a small or small disadvantaged business concern
in order to obtain a contract to be awarded under the preference
programs established pursuant to sections 8(a), 8(d), 9, or 15 of
the Small Business Act or any other provision of Federal law that
specifically references section 8(d) for a definition of program
eligibility, shall --
(i) be punished by imposition of a fine, imprisonment, or
both;
(ii) be subject to administrative remedies, including
suspension and debarment; and
(iii) be ineligible for participation in programs
conducted under the authority of the Act.
SECTION II
K-7. CERTIFICATION OF NONSEGREGATED FACILITIES (APR 1984)
(FAR 52.222-21)
(a) "Segregated facilities," as used in this provision,
means any waiting rooms, work areas, rest rooms and wash rooms,
restaurants and other eating areas, time clocks, locker rooms and
other storage or dressing areas, parking lots, drinking
fountains, recreation or entertainment areas, transportation, and
housing facilities provided for employees, that are segregated by
explicit directive or are in fact segregated on the basis of
race, color, religion, or national origin because of habit, local
custom, or otherwise.
(b) By the submission of this offer, the offeror certifies
that it does not and will not maintain or provide for its
employees any segregated facilities at any of its establishments,
and that it does not and will not permit its employees to perform
their services at any location under its control where segregated
facilities are maintained. The offeror agrees that a breach of
this certification is a violation of the Equal Opportunity clause
in the contract.
(c) The offeror further agrees that (except where it has
obtained identical certifications from proposed subcontractors
for specific time periods) it will --
(1) Obtain identical certifications from proposed
subcontractors before the award of subcontracts under which the
subcontractor will be subject to the Equal Opportunity clause;
(2) Retain the certifications in the files; and
(3) Forward the following notice to the proposed
subcontractors (except if the proposed subcontractors have
submitted identical certifications for specific time periods):
NOTICE TO PROSPECTIVE SUBCONTRACTORS OF REQUIREMENT FOR
CERTIFICATIONS OF NONSEGREGATED FACILITIES.
A Certification of Nonsegregated Facilities must be
submitted before the award of a subcontract under which the
subcontractor will be subject to the Equal Opportunity clause.
The certification may be submitted either for each subcontract or
for all subcontracts during a period (i.e., quarterly,
semiannually, or annually).
NOTE: The penalty for making false statements in offers is
prescribed in 18 U.S.C. 1001.
K-8. PREVIOUS CONTRACTS AND COMPLIANCE REPORTS (APR 1984)
(FAR 52.222-22)
The offeror represents that --
(a) It [ X ] has, [ ] has not, participated in a previous
contract or subcontract subject either to the Equal Opportunity
clause of this solicitation, the clause originally contained in
Section 310 of Executive Order No. 10925, or the clause contained
in Section 201 of Executive Order No. 11114;
(b) It [ X] has, [ ] has not, filed all required
compliance reports; and
(c) Representations indicating submission of required
compliance reports, signed by proposed subcontractor, will be
obtained before subcontract awards.
K-9. AFFIRMATIVE ACTION COMPLIANCE (APR 1984)
(FAR 52.222-25)
The offeror represents that (a) it [ X ] has developed and has on
file, [ ] has not developed and does not have on file, at each
establishment, affirmative action programs required by the rules and
regulations of the Secretary of Labor (41 CFR 60-1 and 60-2), or (b)
it [ ] has not previously had contracts subject to the written
affirmative action programs requirement of the rules and regulations
of the Secretary of Labor.
SECTION III
K-10. (THIS SECTION IS INTENTIONALLY BLANK)
K-11. CERTIFICATION AND DISCLOSURE REGARDING PAYMENTS TO
INFLUENCE CERTAIN FEDERAL TRANSACTIONS (APR 1991) (FAR 52.203-11)
(a) The definitions and prohibitions contained in the
clause, at FAR 52.203-12, Limitation on Payments to Influence
Certain Federal Transactions, included in this solicitation, are
hereby incorporated by reference in paragraph (b) of this
certification.
(b) The offeror, by signing its offer, hereby certifies to
the best of his or her knowledge and belief that on or after
December 23, 1989, --
(1) No Federal appropriated funds have been paid or
will be paid to any person for influencing or attempting to
influence an officer or employee of any agency, a Member of
Congress, an officer or employee of Congress, or an employee of a
Member of Congress on his or her behalf in connection with the
awarding of any Federal contract, the making of any Federal
grant, the making of any Federal loan, the entering into of any
cooperative agreement, and the extension, continuation, renewal,
amendment or modification of any Federal contract, grant, loan,
or cooperative agreement;
(2) If any funds other than Federal appropriated funds
(including profit or fee received under a covered Federal
transaction) have been paid, or will be paid, to any person for
influencing or attempting to influence an officer or employee of
any agency, a Member of Congress, an officer or employee of
Congress, or an employee of a Member of congress on his or her
behalf in connection with this solicitation, the offeror shall
complete and submit, with its offer, OMB standard form LLL,
Disclosure of Lobbying Activities, to the Contracting Officer;
and
(3) He or she will include the language of this
certification in all subcontract awards at any tier and require
that all recipients of subcontract awards in excess of $100,000
shall certify and disclose accordingly.
(c) Submission of this certification and disclosure is a
prerequisite for making or entering into this contract imposed by
section 1352, title 31, United States Code. Any person who makes
an expenditure prohibited under this provision or who fails to
file or amend the disclosure form to be filed or amended by this
provision, shall be subject to a civil penalty of not less than
$10,000, and not more than $100,000, for each such failure.
K-12. CLEAN AIR AND WATER CERTIFICATION
(APR 1984) (FAR 52.223-1)
The Offeror certifies that --
(a) Any facility to be used in the performance of this
proposed contract is [ ], is not X ] listed on the Environmental
Protection Agency (EPA) List of Violating Facilities;
(b) The Offeror will immediately notify the Contracting
Officer, before award, of the receipt of any communication from
the Administrator, or a designee, of the EPA, indicating that any
facility that the Offeror proposes to use for the performance of
the contract is under consideration to be listed on the EPA List
of Violating Facilities; and
(c) The Offeror will include a certification substantially
the same as this certification, including this paragraph (c), in
every nonexempt subcontract.
K-13. CERTIFICATION REGARDING A DRUG-FREE WORKPLACE
(JUL 1995) (FAR 52.223-5)
(a) Definitions. As used in this provision,
"Controlled substance" means a controlled substance in
schedules I through V of section 202 of the Controlled Substances
Act (21 U.S.C. 812) and as further defined in regulation at 21
CFR 1308.11-1308.15.
"Conviction" means a finding of guilt (including a plea of
nolo contendere) or imposition of sentence, or both, by any
judicial body charged with the responsibility to determine
violations of the Federal or State criminal drug statutes.
"Criminal drug statute" means a Federal or non-Federal
criminal statute involving the manufacture, distribution,
dispensing, possession or use of any controlled substance.
"Drug-free workplace" means the site(s) for the performance
of work done by the contractor in connection with a specific
contract at which employees of the Contractor are prohibited from
engaging in the unlawful manufacture, distribution, dispensing,
possession, or use of a controlled substance.
"Employee" means an employee of a Contractor directly
engaged in the performance of work under a Government contract.
"Directly engaged" is defined to include all direct cost
employees and any other Contractor employee who has other than a
minimal impact or involvement in contract performance.
"Individual" means an offeror/contractor that has no more
than one employee including the offeror/contractor.
(b) By submission of its offer, the offeror (other than an
individual) responding to a solicitation that is expected to
exceed the simplified acquisition threshold, certifies and
agrees, that with respect to all employees of the offeror to be
employed under a contract resulting from this solicitation, it
will -- no later than 30 calendar days after contract award
(unless a longer period is agreed to in writing), for contracts
of 30 calendar days or more performance duration: or as soon as
possible for contracts of less than 30 calendar days performance
duration, but in any case, by a date prior to when performance is
expected to be completed --
(1) Publish a statement notifying such employees that
the unlawful manufacture, distribution, dispensing, possession or
use of a controlled substance is prohibited in the Contractor's
workplace and specifying the actions that will be taken against
employees for violations of such prohibition;
(2) Establish an ongoing drug-free awareness program
to inform such employees about --
(i) The dangers of drug abuse in the workplace;
(ii) The Contractor's policy of maintaining a drug-
free workplace;
(iii) Any available drug counseling,
rehabilitation, and employee assistance programs; and
(iv) The penalties that may be imposed upon
employees for drug abuse violations occurring in the workplace;
(3) Provide all employees engaged in performance of
the contract with a copy of the statement required by
subparagraph (b)(1) of this provision;
(4) Notify such employees in writing in the statement
required by subparagraph (b)(1) of this provision that, as a
condition of continued employment on the contract resulting from
this solicitation, the employee will --
(i) Abide by the terms of the statement; and
(ii) Notify the employer in writing of the
employee's conviction under a criminal drug statute for a
violation occurring in the workplace no later than 5 calendar
days after such conviction;
(5) Notify the Contracting Officer in writing within
10 calendar days after receiving notice under subdivision
(b)(4)(ii) of this provision, from an employee or otherwise
receiving actual notice of such conviction. The notice shall
include the position title of the employee; and
(6) Within 30 calendar days after receiving notice
under subdivision (b)(4)(ii) of this provision of a conviction,
take one of the following actions with respect to any employee
who is convicted of a drug abuse violation occurring in the
workplace:
(i) Take appropriate personnel action against
such employee, up to and including termination; or
(ii) Require such employee to satisfactorily
participate in a drug abuse assistance or rehabilitation program
approved for such purposes by a Federal, State, or local health,
law enforcement, or other appropriate agency.
(7) Make a good faith effort to maintain a drug-free
workplace through implementation of subparagraphs (b)(1) through
(b)(6) of this provision.
(c) By submission of its offer, the offeror, if an
individual who is making an offer of any dollar value, certifies
and agrees that the offeror will not engage in the unlawful
manufacture, distribution, dispensing, possession, or use of a
controlled substance in the performance of the contract resulting
from this solicitation.
(d) Failure of the offeror to provide the certification
required by paragraphs (b) or (c) of this provision, renders the
offeror unqualified and ineligible for award. (See FAR 9.104-
1(g) and 19.602-1(a)(2)(i).)
(e) In addition to other remedies available to the
Government, the certification in paragraphs (b) or (c) of this
provision concerns a matter within the jurisdiction of an agency
of the United States and the making of a false, fictitious, or
fraudulent certification may render the maker subject to
prosecution under Title 18, United States Code, Section 1001.
K-14. CERTIFICATION OF TOXIC CHEMICAL RELEASE REPORTING
(OCT 1995) (FAR 52.223.13)
(a) The offeror, by signing this offer, certifies that --
(Note: The offeror must check the appropriate box(es).)
[ X ] (1) To the best of its knowledge and belief,
it is not subject to the filing and reporting requirements
described in Emergency Planning and Community Right-to-Know Act
of 1986 (EPCRA) sections 313(a) and (g) and Pollution Prevention
Act of 1990 (PPA) section 6607 because none of its owned or
operated facilities to be used in the performance of this
contract currently --
[ X ] (i) Manufacture, process or otherwise
use any toxic chemicals listed under section 313(c) of EPCRA, 42
U.S.C. 11023(c).
[ ] (ii) Have 10 or more full-time employees as
specified in section 313(b)(1)(A) of EPCRA, 42 U.S.C.
11023(b)(1)(A).
[ ] (iii) Meet the reporting thresholds of
toxic chemicals established under section 313(f) of EPCRA, 42
U.S.C. 11023(f) (including the alternate thresholds at 40 CFR
372.27, provided an appropriate certification form has been filed
with EPA).
[X ] (iv) Fall within Standard Industrial
Classification Code (SIC) designations 20 through 39 as set forth
in FAR section 19.102.
[ ] (2) If awarded a contract resulting from this
solicitation, its owned or operated facilities to be used in the
performance of this contract, unless otherwise exempt, will file
and continue to file for the life of the contract the Toxic
Chemical Release Inventory Form (Form R) as described in EPCRA
sections 313(a) and (g) and PPA section 6607 (42 U.S.C. 13106).
(b) Submission of this certification is a prerequisite for
making or entering into this contract imposed by Executive Order
12969, August 8, 1995 (60 FR 40989-40992).
SECTION IV
K-15. COST ACCOUNTING STANDARDS NOTICES AND CERTIFICATION
(APR 1996) (FAR 52.230-1)
Note: This notice does not apply to small businesses or
foreign governments. This notice is in three parts, identified
by Roman numerals I through III.
Offerors shall examine each part and provide the requested
information in order to determine Cost Accounting Standards (CAS)
requirements applicable to any resultant contract.
If the offeror is an educational institution, Part II does
not apply unless the contemplated contract will be subject to
full or modified CAS coverage pursuant to 48 CFR 9903.210-2(c)(5)
or 9903.201-2(c)(6), respectively.
I. DISCLOSURE STATEMENT -- COST ACCOUNTING PRACTICES AND
CERTIFICATION
(a) Any contract in excess of $500,000 resulting from this
solicitation, except contracts in which the price negotiated is
based on (1) established catalog or market prices of commercial
items sold in substantial quantities to the general public, or
(2) prices set by law or regulation, will be subject to the
requirements of the Cost Accounting Standards Board (48 CFR
Chapter 99) except for those contracts which are exempt as
specified in 48 CFR 9903.201-1.
(b) Any offeror submitting a proposal which, if accepted,
will result in a contract subject to the requirements of 48 CFR
Chapter 99 must, as a condition of contracting, submit a
Disclosure Statement as required by 48 CFR 9903.202. When
required, the Disclosure Statement must be submitted as a part of
the offeror's proposal under this solicitation unless the offeror
has already submitted a Disclosure Statement disclosing the
practices used in connection with the pricing of this proposal.
If an applicable Disclosure Statement has already been submitted,
the offeror may satisfy the requirement for submission by
providing the information requested in paragraph (c) of Part I of
this provision.
CAUTION: In the absence of specific regulations or
agreement, a practice disclosed in a Disclosure Statement shall
not, by virtue of such disclosure, be deemed to be a proper,
approved, or agreed-to practice for pricing proposals or
accumulating and reporting contract performance cost data.
(c) Check the appropriate box below:
[ ] (1) Certificate of Concurrent Submission of
Disclosure Statement.
The offeror hereby certifies that, as a part of
the offer, copies of the Disclosure Statement have been submitted
as follows: (i) original and one copy to the cognizant
Administrative Contracting Officer (ACO) or cognizant Federal
agency official authorized to act in that capacity (Federal
official), as applicable, and (ii) one copy to the cognizant
Federal auditor.
(Disclosure must be on Form No. CASB DS-1 or CASB
DS-2, as applicable. Forms may be obtained from the cognizant
ACO or Federal official and/or from the loose-leaf version of the
Federal Acquisition Regulation.)
Date of Disclosure Statement:
Name and Address of Cognizant ACO or Federal
Official Where Filed:
The offeror further certifies that practices used
in estimating costs in pricing this proposal are consistent with
the cost accounting practices disclosed in the Disclosure
Statement.
[ ] (2) Certificate of Previously Submitted
Disclosure Statement.
The offeror hereby certifies that Disclosure
Statement was filed as follows:
Date of Disclosure Statement:
Name and Address of Cognizant ACO or Federal
Official Where Filed:
The offeror further certifies that the practices
used in estimating costs in pricing this proposal are consistent
with the cost accounting practices disclosed in the applicable
Disclosure Statement.
[ ] (3) Certificate of Monetary Exemption.
The offeror hereby certifies that the offeror,
together with all divisions, subsidiaries, and affiliates under
common control, did not receive net awards of negotiated prime
contracts and subcontracts subject to CAS totaling more than $25
million (of which at least one award exceeded $1 million) in the
cost accounting period immediately preceding the period in which
this proposal was submitted. The offeror further certifies that
if such status changes before an award resulting from this
proposal, the offeror will advise the Contracting Officer
immediately.
[ ] (4) Certificate of Interim Exemption.
The offeror hereby certifies that (i) the offeror
first exceeded the monetary exemption for disclosure, as defined
in (3) of this subsection, in the cost accounting period
immediately preceding the period in which this offer was
submitted and (ii) in accordance with 48 CFR 9903.202-1, the
offeror is not yet required to submit a Disclosure Statement.
The offeror further certifies that if an award resulting from
this proposal has not been made within 90 days after the end of
that period, the offeror will immediately submit a revised
certificate to the Contracting Officer, in the form specified
under subparagraphs (c)(1) or (c)(2) of Part I of this provision,
as appropriate, to verify submission of a completed Disclosure
Statement.
CAUTION: Offerors currently required to disclose because
they were awarded a CAS-covered prime contract or subcontract of
$25 million or more in the current cost accounting period may not
claim this exemption (4). Further, the exemption applies only in
connection with proposals submitted before expiration of the 90-
day period following the cost accounting period in which the
monetary exemption was exceeded.
II. COST ACCOUNTING STANDARDS -- ELIGIBILITY FOR MODIFIED
CONTRACT COVERAGE
If the offeror is eligible to use the modified provisions of
48 CFR 9903.201-2(b) and elects to do so, the offeror shall
indicate by checking the box below. Checking the box below shall
mean that the resultant contract is subject to the Disclosure and
Consistency of Cost Accounting Practices clause in lieu of the
Cost Accounting Standards clause.
[ ] The offeror hereby claims an exemption from the Cost
Accounting Standards clause under the provisions of 48 CFR
9903.201-2(b) and certifies that the offeror is eligible for use
of the Disclosure and Consistency of Cost Accounting Practices
clause because during the cost accounting period immediately
preceding the period in which this proposal was submitted, the
offeror received less than $25 million in awards of CAS-covered
prime contracts and subcontracts, or the offeror did not receive
a single CAS-covered award exceeding $1 million. The offeror
further certifies that if such status changes before an award
resulting from this proposal, the offeror will advise the
Contracting Officer immediately.
CAUTION: An offeror may not claim the above eligibility for
modified contract coverage if this proposal is expected to result
in the award of a CAS-covered contract of $25 million or more or
if, during its current cost accounting period, the offeror has
been awarded a single CAS-covered prime contract or subcontract
of $25 million or more.
III. ADDITIONAL COST ACCOUNTING STANDARDS APPLICABLE TO EXISTING
CONTRACTS
The offeror shall indicate below whether award of the
contemplated contract would, in accordance with subparagraph
(a)(3) of the Cost Accounting Standards clause, require a change
in established cost accounting practices affecting existing
contracts and subcontracts.
[ ] YES [ ] NO
SECTION VII
K-23. SMALL DISADVANTAGED BUSINESS CONCERN
REPRESENTATION
(DoD CONTRACTS). (APR 1994) (DFARS 252.219-7000)
(a) Definition.
"Small disadvantaged business concern", as used in this
provision, means a small business concern, owned and controlled
by individuals who are both socially and economically
disadvantaged, as defined by the Small Business Administration at
13 CFR part 124, the majority of earnings of which directly
accrue to such individuals. This term also means a small
business concern owned and controlled by an economically
disadvantaged Indian tribe or Native Hawaiian organization which
meets the requirements of 13 CFR 124.112 or 13 CFR 124.113,
respectively. In general, 13 CFR part 124 describes a small
disadvantaged business concern as a small business concern
(1) Which is at least 51 percent unconditionally owned
by one or more socially and economically disadvantaged
individuals; or
(2) In the case of any publicly owned business, at
least 51 percent of the voting stock is unconditionally owned by
one or more socially and economically disadvantaged individuals;
and
(3) Whose management and daily business operations are
controlled by one or more such individuals.
(b) "Representations." Check the category in which your
ownership falls
Subcontinent Asian (Asian-Indian) American (U.S.
citizen with origins from India, Pakistan, Bangladesh, Sri Lanka,
Bhutan, or Nepal)
Asian-Pacific American (U.S. citizen with origins from
Japan, China, the Philippines, Vietnam, Korea, Samoa, Guam, U.S.
Trust Territory of the Pacific Islands (Republic of Palau), the
Northern Mariana Islands, Laos, Kampuchea (Cambodia), Taiwan,
Burma, Thailand, Malaysia, Indonesia, Singapore, Brunei, Republic
of the Marshall Islands, or the Federated States of Micronesia)
Black American (U.S. citizen)
Hispanic American (U.S. citizen with origins from South
America, Central America, Mexico, Cuba, the Dominican Republic,
Puerto Rico, Spain, or Portugal)
Native American (American Indians, Eskimos, Aleuts, or
Native Hawaiians, including Indian tribes or Native Hawaiian
organizations)
Individual/concern, other than one of the preceding,
currently certified for participation in the Minority Small
Business and Capital Ownership Development Program under section
8(a) of the Small Business Act
Other
(c) "Certifications." Complete the following --
(1) The offeror is is not X a small
disadvantaged business concern.
(2) The Small Business Administration (SBA) has
has not X made a determination concerning the offeror's
status as a small disadvantaged business concern. If the SBA has
made a determination, the date of the determination was
and the offeror
Was found by SBA to be socially and
economically disadvantaged and no circumstances have changed to
vary that determination.
Was found by SBA not to be socially and
economically disadvantaged but circumstances which caused the
determination have changed.
(d) "Penalties and Remedies." Anyone who misrepresents the
status of a concern as a small disadvantaged business for the
purpose of securing a contract or subcontract shall --
(1) Be punished by imposition of a fine, imprisonment,
or both;
(2) Be subject to administrative remedies, including
suspension and debarment; and
(3) Be ineligible for participation in programs
conducted under authority of the Small Business Act.
SECTION VIII
K-24. REPRESENTATION OF EXTENT OF TRANSPORTATION BY SEA
(AUG 1992) (DFARS 252.247-7022)
(a) The Offeror shall indicate by checking the appropriate
blank in paragraph (b) of this provision whether transportation
of supplies by sea is anticipated under the resultant contract.
The term supplies is defined in the Transportation of Supplies by
Sea clause of this solicitation.
(b) "Representation." The offeror represents that it --
Does anticipate that supplies will be transported
by sea in the performance of any contract or subcontract
resulting from this solicitation.
X Does not anticipate that supplies will be
transported by sea in the performance of any contract or
subcontract resulting from this solicitation.
(c) Any contract resulting from this solicitation will
include the Transportation of Supplies by Sea clause. If the
Offeror represents that it will not use ocean transportation, the
resulting contract will also include the Defense FAR Supplement
clause at 252.247-7024, Notification of Transportation of
Supplies by Sea.
SECTION XI
K-31. CERTIFICATE OF INDEPENDENT PRICE DETERMINATION
(APR 1985) (FAR 52.203-2)
(a) The offeror certifies that --
(1) The prices in this offer have been arrived at
independently, without, for the purpose of restricting
competition, any consultation, communication, or agreement with
any other offeror or competitor relating to (i) those prices,
(ii) the intention to submit an offer, or (iii) the methods or
factors used to calculate the prices offered;
(2) The prices in this offer have not been and will
not be knowingly disclosed by the offeror, directly or
indirectly, to any other offeror or competitor before bid opening
(in the case of a sealed bid solicitation) or contract award (in
the case of a negotiated solicitation) unless otherwise required
by law; and
(3) No attempt has been made or will be made by the
offeror to induce any other concern to submit or not to submit an
offer for the purpose of restricting competition.
(b) Each signature on the offer is considered to be a
certification by the signatory that the signatory --
(1) Is the person in the offeror's organization
responsible for determining the prices being offered in this bid
or proposal, and that the signatory has not participated and will
not participate in any action contrary to subparagraphs (a)(1)
through (a)(3) above; or
(2) (i) Has been authorized, in writing, to act as
agent for the following principals in certifying that those
principals have not participated, and will not participate in any
action contrary to subparagraphs (a)(1) through (a)(3) above
(insert full name of person(s) in the offeror's
organization responsible for determining the prices offered in
this bid or proposal, and the title of his or her position in the
offeror's organization);
(ii) As an authorized agent, does certify that the
principals named in subdivision (b)(2)(i) above have not
participated, and will not participate, in any action contrary to
subparagraphs (a)(1) through (a)(3) above; and
(iii) As an agent, has not personally
participated, and will not participate, in any action contrary to
subparagraphs (a)(1) through (a)(3) above.
(c) If the offeror deletes or modifies subparagraph (a)(2)
above, the offeror must furnish with its offer a signed statement
setting forth in detail the circumstances of the disclosure.
K-32. CONTINGENT FEE REPRESENTATION AND AGREEMENT
(APR 1984) (FAR 52.203-4)
(a) Representation. The offeror represents that, except
for full-time bona fide employees working solely for the offeror,
the offeror --
(Note: The offeror must check the appropriate boxes. For
interpretation of the representation, including the term "bona
fide employee," see Subpart 3.4 of the Federal Acquisition
Regulation.)
(1) [ ] has, [ X ] has not employed or retained any
person or company to solicit or obtain this contract; and
(2) [ ] has, [ X ] has not paid or agreed to pay to
any person or company employed or retained to solicit or obtain
this contract any commission, percentage, brokerage, or other fee
contingent upon or resulting from the award of this contract.
(b) Agreement. The offeror agrees to provide information
relating to the above Representation as requested by the
Contracting Officer and, when subparagraph (a)(1) or (a)(2) is
answered affirmatively, to promptly submit to the Contracting
Officer --
(1) A completed Standard Form 119, Statement of
Contingent or Other Fees, (SF 119); or
(2) A signed statement indicating that the SF 119 was
previously submitted to the same contracting office, including
the date and applicable solicitation or contract number, and
representing that the prior SF 119 applies to this offer or
quotation.
K-33.NOTICE OF RESTRICTIONS ON CONTRACTING WITH SANCTIONED
PERSONS (MAY 1989) (FAR 52.225-12)
(a) Statutory prohibitions have been imposed on contracting
with sanctioned persons, as specified in Federal Acquisition
Regulation (FAR) 52.225-13, Restrictions on Contracting with
Sanctioned Persons.
(b) By submission of this offer, the Offeror represents
that no products or services, except those listed in this
paragraph (b), delivered to the government under any contract
resulting from this solicitation will be products or services of
a sanctioned person, as defined in the clause referenced in
paragraph (a) of this provision, unless one of the exceptions in
paragraph (d) of the clause at FAR 52.225-13 applies.
Product or Service Sanctioned Person
NOT APPLICABLE
(List as necessary)
K-34. DISCLOSURE OF OWNERSHIP OR CONTROL BY THE GOVERNMENT
OF A TERRORIST COUNTRY (SEP 1994) (DFARS 252.209-7001)
(a) Definitions.
As used in this provision --
(1) "Government of a terrorist country" includes the
state and the government of a terrorist country, as well as any
political subdivision, agency, or instrumentality thereof.
(2) "Terrorist country" means a country determined by
the Secretary of State, under section 6(j)(1)(A) of the Export
Administration Act of 1979 (50 U.S.C. App. 2405(j)(i)(A)), to be
a country the government of which has repeatedly provided support
for acts of international terrorism. As of the date of this
provision, terrorist countries include: Cuba, Iran, Iraq, Libya,
North Korea, Sudan, and Syria.
(3) "Significant interest" means --
(i) Ownership of or beneficial interest in five
percent or more of the firm's or subsidiary's securities.
Beneficial interest includes holding five percent or more of any
class of the firm's securities in "nominee shares", "street
names", or some other method of holding securities that does not
disclose the beneficial owner;
(ii) Holding a management position in the firm,
such as a director or officer;
(iii) Ability to control or influence the
election, appointment, or tenure of directors or officers in the
firm;
(iv) Ownership of ten percent or more of the
assets of a firm such as equipment, buildings, real estate, or
other tangible assets of the firm; or
(v) Holding 50 percent or more of the
indebtedness of a firm.
(b) Prohibition on award.
In accordance with 10 U.S.C. 2327, no contract may be
awarded to a firm or a subsidiary of a firm if the government of
a terrorist country has a significant interest in the firm or
subsidiary, unless a waiver is granted by the Secretary of
Defense.
(c) Disclosure.
If the government of a terrorist country has a significant
interest in the Offeror, the Offeror shall disclose such interest
in an attachment to its offer. If the Offeror is a subsidiary,
it shall also disclose any significant interest the government of
a terrorist country has in any firm that owns or controls the
subsidiary. The disclosure shall include --
(1) Identification of each government holding a
significant interest; and
(2) A description of the significant interest held by
each government.
LICENSE AGREEMENT
("Solid Edge Specific Code")
THIS AGREEMENT (this "Agreement"), dated as of March 2,
1998 (the "Effective Date"), by and between Intergraph
Corporation, a Delaware corporation having its principal
place of business at One Madison Industrial Park,
Huntsville, Alabama 35894 ("Intergraph") and Unigraphics
Solutions Inc., a Delaware corporation having its principal
place of business at 13736 Riverport Drive, Maryland
Heights, Missouri 63043 ("Unigraphics").
W I T N E S S E T H :
WHEREAS, contemporaneously herewith, Intergraph and
Unigraphics and certain of their respective affiliates have
executed and delivered that certain Asset Purchase Agreement
dated March 2, 1998 (the "Asset Purchase Agreement") with
respect to the sale, transfer, or license by Intergraph to
Unigraphics of certain assets, including certain assets
relating to the Intergraph Solid Edge Business (as defined
herein);
WHEREAS, pursuant to the Asset Purchase Agreement,
Intergraph has transferred, sold, assigned, and conveyed
certain assets, including the Intergraph Solid Edge Business
but has retained all obligations to sell Intergraph Solid
Edge Products and to provide support and maintenance for
Intergraph Solid Edge Products (as defined herein) to
certain agencies of the Government of the United States of
America (including, without limitation, the U.S. Department
of the Navy) pursuant to the CAD-2 Contract (as defined
hereinafter);
WHEREAS, Intergraph and Unigraphics have recognized and
agreed that the CAD-2 Contract is not assignable or
transferable by Intergraph to Unigraphics and requires
Intergraph to continue to have the ability to sell,
maintain, provide training for and support the Solid Edge
Products during the entire term of the CAD-2 Contract, and
any extensions or renewals thereof;
WHEREAS, Unigraphics intends to make the Licensed
Property (as defined herein) available to and to license
Intergraph to use the Licensed Property pursuant to the
terms and conditions of this Agreement, and Unigraphics
intends to reserve and retain ownership of and rights in the
Licensed Property;
WHEREAS, Unigraphics desires to grant to Intergraph and
Intergraph desires to receive from Unigraphics a license
with respect to the Licensed Property, in all events solely
and exclusively upon the terms and conditions set forth
herein; and
WHEREAS, Unigraphics desires to retain and reserve
ownership of and other rights in the Licensed Property and
Intergraph desires to agree to such retention and
reservation of rights in the Licensed Property by
Unigraphics, in all events solely and exclusively upon the
terms and conditions set forth herein;
NOW, THEREFORE, in consideration of the mutual
promises, covenants, and agreements set forth herein and
other good and valuable consideration, including, without
limitation the execution and delivery of the Asset Purchase
Agreement, the receipt and adequacy of which is hereby
acknowledged, Intergraph and Unigraphics, intending to be
legally bound, hereby agree as follows:
Section 1. Definitions.
Capitalized terms used in this Agreement shall have the
meanings provided in the Asset Purchase Agreement, except
the capitalized terms listed below which shall have the
following meanings:
(a) Adaptation shall mean any work incorporating any
Solid Edge Specific Code (whether directly or indirectly),
including, without limitation, any modified, altered, or
amended version of the Solid Edge Specific Code (but not any
modification, alteration, or amendment of the Solid Edge
Specific Code which, under applicable law, constitutes a
derivative work), or any work utilizing a method or concept
from the Solid Edge Specific Code.
(b) CAD-2 Contract shall mean, collectively, those
certain agreements (as such may be amended, extended,
renewed, or modified from time to time through September 30,
2006) to sell, support, and maintain end users who have or
may purchase a license to use the Licensed Property between
Intergraph and the Government of the United States of
America as follows:
(i) Contract Number N66032-91-D-0003, dated April
8, 1991;
(ii) Contract Number N66032-93-D-0021, dated
August 30, 1993; and
(iii) Contract Number N66032-94-D-0012, dated
July 13, 1994.
(c) CAD-2 Customers shall mean the end-user customers
who have purchased or who may purchase a license to use the
Licensed Property in accordance with the CAD-2 Contract.
(d) Confidential Information shall mean any data,
source code, trade secrets, documentation, notes, or
information (oral or written) heretofore created, developed,
controlled, possessed, or obtained by Unigraphics or
exchanged between the parties, and treated as confidential
and so identified, that concerns the Solid Edge Specific
Code or relates in any manner to technical or business
aspects of the Solid Edge Specific Code as used or exists in
the Intergraph Solid Edge Business. Notwithstanding the
foregoing, Confidential Information will not be deemed to
include information that is (i) publicly available or in the
public domain at the time disclosed, (ii) or becomes
publicly available or enters the public domain through no
fault of the party receiving such information,
(iii) rightfully communicated to the recipient by persons
not bound by confidentiality obligations with respect
thereto, (iv) already in the recipient's possession free of
any confidentiality obligations with respect thereto at the
time of disclosure, (v) approved by the disclosing party for
release or disclosure without restriction.
(e) Copyright(s) shall mean all copyright interests in
the Solid Edge Specific Code and Documentation acquired by
Unigraphics from Intergraph pursuant to the Asset Purchase
Agreement, including, without limitation, all common-law
rights.
(f) Development Environment shall mean any
programming, documentation, and media acquired by
Unigraphics from Intergraph pursuant to the Asset Purchase
Agreement for the development, maintenance, testing and
implementation of the Solid Edge Specific Code, solely and
exclusively to the extent such objects may be practically
required by Intergraph for any subsequent maintenance,
testing or enhancement of the Solid Edge Specific Code
pursuant to this Agreement or related programming by
Intergraph, in all events, for performance of the CAD-2
Contract, provided, however that "Development Environment"
shall not include the BAG Products or the INGR Tools (as the
BAG Products and the INGR Tools are defined, respectively,
in that certain BAG Products License Agreement and in that
certain INGR Tools License Agreement (as each such Agreement
is defined in the Asset Purchase Agreement)), or the LTS
Tools.
(g) Documentation shall mean all written materials
(including, design documentation, user documentation, and
program documentation) acquired by Unigraphics from
Intergraph pursuant to the Asset Purchase Agreement for use,
distribution, and/or maintenance of the Solid Edge Specific
Code.
(h) Intergraph Fields shall mean the following
specific fields: performance of each and every CAD-2
Contract (including, without limitation, sales of Solid Edge
Products to CAD-2 Customers and all training, maintenance,
and support related thereto).
(i) Intergraph Solid Edge Business shall mean
Intergraph's Solid Edge Products and line of business, as
such exist on the Effective Date immediately before the
Closing of the Asset Purchase Agreement.
(j) Licensed Property shall mean the Solid Edge
Specific Code, as such exists on the Effective Date,
including the expressions of an organized set of
instructions in a natural or coded language which are
contained on physical media of any nature (e.g., written,
electronic, magnetic, optical, or otherwise) and which may
be used with a computer or other automated data processing
equipment device of any nature which is based on digital
technology, to make such computer or other device operate in
a particular manner and for a particular purpose, as well as
any related Documentation for such set of instructions; and
"Licensed Property" shall include computer programs in
source and object code, test and other significant data
libraries, Documentation for such computer programs and any
of the following components which is contained on a physical
media of any nature and which is used in the design,
development, modification, enhancement, testing,
installation, maintenance, diagnosis, or assurance of the
performance of the Solid Edge Specific Code (collectively,
the "Miscellaneous Software Components"): processes,
techniques, algorithms, symbologies, interfaces,
calculations, models, narrative descriptions, notes,
specifications, designs, flow charts, parameters or
descriptions, logic flow diagrams, masks, input and output
formats, file layouts, data base formats, test programs,
test or other data, user guidelines, manuals, installation
and operating instructions, diagnostic and maintenance
instructions, source code, object code, and other similar
materials and information; and "Licensed Property" shall
further include all Confidential Information, Adaptations,
and Copyrights, in all events as such exists on the
Effective Date, which were included in the Intergraph Solid
Edge Business, which Unigraphics acquired from Intergraph
pursuant to the Asset Purchase Agreement, and which are
necessary for the use or execution of the Solid Edge
Specific Code or any Miscellaneous Software Components. To
the extent that Unigraphics has the authority to do so
without incurring any material obligation (but not
otherwise), the Licensed Property shall include a non-
exclusive, royalty-free license to any part of the
Development Environment for the Licensed Property that is
owned by Unigraphics or its Affiliates or is not
commercially available elsewhere, in all events as such
exists on the Effective Date and subject to the other terms
and conditions set forth herein. Notwithstanding anything
to the contrary appearing in this Section 1(j), the Licensed
Property shall not include any Third-Party Software
incorporated or embedded in, or compiled or combined with,
the Licensed Property and/or the Development Environment, or
any Patent Rights, the BAG Products or the INGR Tools, or
LTS Tools.
(k) Patent Rights shall mean all domestic and foreign
patents (including, without limitation, certificates of
invention and other patent equivalents), provisional
applications, patents issuing therefrom, any division or
continuation, re-issue, extension, revival, or renewal of
any patent or invention.
(l) Product shall mean the products offered,
distributed, or sold by Intergraph, from time to time.
(m) Solid Edge Product shall mean the Solid Edge
products offered, distributed and/or sold by Unigraphics or
Intergraph, from time to time.
(n) Solid Edge Specific Code shall mean that certain
source code which, on the Effective Date, is unique to the
Solid Edge Version 4 product of the Business and is not used
in other Intergraph Products or development activities. The
CD-ROM delivered to Unigraphics pursuant to Section 4 hereof
provides the parties' best identification of the Solid Edge
Specific Code as of the Effective Date.
(o) Third-Party Software shall mean computer software
or other technology in which any Person, other than the
Selling Entities or any other subsidiaries of Intergraph,
has any right, title, or interest, including any
restrictions or obligations (such as, obligations to obtain
consents or approvals, and restrictions that may be
eliminated only by obtaining such consents or approvals)
applicable to the Licensed Property.
Section 2. Ownership of Licensed Property.
The Licensed Property is the property of and is owned
by Unigraphics and title shall remain vested in Unigraphics.
Intergraph acknowledges and agrees that the Licensed
Property is comprised of trade secrets, proprietary
information, and other Confidential Information, whether or
not any portion thereof is or may be copyrightable or
patented, and that Intergraph will not use, distribute,
copy, perform, amend, alter, modify, exploit, sublicense or
assign the Licensed Property, or permit any such to occur,
except as expressly and specifically permitted in by this
Agreement.
Section 3. License and Retained Rights.
(a) Unigraphics hereby grants to Intergraph (i) an
exclusive, world-wide, transferable (to the extent permitted
by Section 13 hereof) license of the Licensed Property in
the Intergraph Fields for any purpose whatsoever, which
License shall be for a period beginning the Effective Date
through and including September 30, 2006, or the expiration
or termination of all of Intergraph's obligations under the
CAD-2 Contract, whichever shall first occur. Intergraph
hereby accepts the License. Unigraphics agrees that it
shall not have any right to use the Licensed Property in the
Intergraph Fields.
(b) Nothing contained in this Agreement shall be
construed as conferring by implication, estoppel, or
otherwise any license or right under any confidential
information, patent, copyright, trade secret, or other
intellectual property, which is not expressly granted
hereunder.
(c) Intergraph shall pay to Unigraphics a royalty
equal to one hundred percent (100%) of Intergraph's net
sales price on sales of Intergraph Solid Edge Version 4
Products under any CAD-2 Contract (the "Royalty"). No
Royalty shall be due hereunder provided that the parties
have entered into a reseller agreement providing for a
royalty. If a Royalty is due hereunder, the Royalty shall
be payable on or before the fifteenth calendar day after the
end of each calendar quarter and shall be accompanied by a
written report of the total revenue from sales of Intergraph
Solid Edge Products with respect to the CAD-2 Contract.
Unigraphics shall have the right to audit the records of
Intergraph with respect to the sales of Intergraph Solid
Edge Products to CAD-2 Customers (which records shall be
deemed to be included in the Confidential Information (as
defined herein)) no more frequently than once each calendar
year, shall give Intergraph reasonable notice of any such
audit, and shall conduct all such audits during Intergraph's
usual business hours. If any such audit results in an under-
payment of more than ten percent (10%) of the total Royalty
that should have been paid during the period subject to such
audit, Intergraph shall bear the cost of such audit and
shall pay to Unigraphics the amount of such underpayment
within ten (10) days following the completion of such audit,
otherwise Unigraphics shall pay all costs associated with
such audit. If Intergraph has overpaid the Royalty,
Unigraphics shall pay Intergraph the amount of such over-
payment within ten (10) days following completion of such
audit. Intergraph shall preserve its records relating to
its sales or maintenance of Intergraph Solid Edge Products
for a period of two years. If requested by Intergraph,
Unigraphics shall make the results of any such audit
available to Intergraph. Neither the execution of this
Agreement, the granting of the License, nor Intergraph's use
or exploitation of the Licensed Property shall be construed
as an obligation of Unigraphics to furnish any Person
(including, without limitation, Intergraph) any assistance
of any kind whatsoever, or any enhancements, adaptations,
improvements, modifications, corrections, documentation,
support, training, installation or maintenance with respect
to the Licensed Property or any portion thereof, information
or documentation, other than as expressly provided in
Section 4.
(d) To the extent that Intergraph creates any
derivative work using or incorporating the Licensed Property
by customizing, enhancing, modifying, or altering any or all
portions of the Licensed Property after the Effective Date,
those portions of each such derivative work which do not
constitute Licensed Property shall be considered separate
and independent derivative works with respect to which
Intergraph shall retain all right, title, and interest,
including, without limitation, the right to seek separate
copyright registration for such derivative work in
accordance with applicable law; provided, however, that such
copyright registration shall identify the Licensed Property
as copyrightable subject matter from which the derivative
work was derived. Intergraph shall have no obligation to
provide information concerning, make available, or grant any
right in any such derivative work to Unigraphics. All
derivative works based on the Licensed Property and created
by Intergraph shall be subject to the field of use
restrictions of Section 3(a) as though such derivative works
were Licensed Property.
(e) Notwithstanding any other provision of this
Agreement to the contrary, nothing herein shall be construed
to create a partnership or joint venture between the
parties, to authorize either party to act as agent for the
other, to permit either party to undertake any agreement for
the other, or to use the name or identifying mark or marks
of the other, all except as expressly provided herein or in
other agreements between or among the parties.
(f) Intergraph and Unigraphics, each, agree that it
will not assume any obligation or undertake any action which
is inconsistent with this Agreement.
Section 4. Delivery; Information Exchange.
At the Principal Closing, Intergraph shall deliver to
Unigraphics and shall retain a master copy of the Solid Edge
Specific Code source code in the form of a CD-ROM containing
all directories for the Solid Edge Specific Code, together
with their files, folders, data, information, and source
code, Documentation and any other relevant documentation or
media that evidences or supports the Solid Edge Specific
Code, in all events as such exists on the Effective Date,
such Documentation and media shall include, to the extent
the same exists, system documentation, statements of
principles of operation, and schematics for the Licensed
Property, as well as any pertinent commentary or explanation
that may be necessary to render the Licensed Property
understandable and usable by a trained computer programmer.
Intergraph shall hold such master copy of the Solid Edge
Specific Code as Confidential Information.
Section 5. Term.
This Agreement shall become effective on the Effective
Date and, except as expressly provided herein, shall remain
in force in perpetuity (or for the longest period otherwise
permitted by law), unless earlier terminated or expired in
accordance with this Agreement.
Section 6. Indemnification and Protection of Licensed
Property; Disclaimer of Certain Warranties.
(a) The indemnification provisions set forth in
Article IX of the Asset Purchase Agreement are incorporated
by reference herein as though set forth herein, to the
extent such indemnification provisions apply to the Licensed
Property or to this Agreement.
(b) UNIGRAPHICS HEREBY DISCLAIMS ALL EXPRESS OR
IMPLIED WARRANTIES INCLUDING, WITHOUT LIMITATION, THE
WARRANTIES OF MERCHANTABILITY AND FITNESS FOR A PARTICULAR
PURPOSE.
WITH RESPECT TO THE LICENSED PROPERTY AS OF THE
EFFECTIVE DATE, INTERGRAPH ACKNOWLEDGES AND AGREES THAT (i)
PRIOR TO THE EFFECTIVE DATE THE LICENSED PROPERTY HAS BEEN
AVAILABLE TO AND USED BY THE EMPLOYEES OF INTERGRAPH, (ii)
INTERGRAPH IS RETAINING THE LICENSED PROPERTY "AS IS, WHERE
IS," (iii) INTERGRAPH HAS HAD REASONABLE OPPORTUNITY TO TEST
ANY SOFTWARE INCLUDED WITH THE LICENSED PROPERTY IN A MANNER
AND WITH SUCH METHODS AS INTERGRAPH HAS DEEMED NECESSARY,
AND (iv) BY EXECUTING THIS AGREEMENT, INTERGRAPH ACCEPTS THE
LICENSED PROPERTY AS CONFORMING TO INTERGRAPH'S NEEDS AND
REQUIREMENTS.
NOTWITHSTANDING THE FOREGOING, THE REPRESENTATIONS AND
WARRANTIES SET FORTH IN THE ASSET PURCHASE AGREEMENT SHALL
NOT BE DIMINISHED OR CHANGED IN ANY WAY HEREBY.
Section 7. Export Requirements.
With respect to the export by Intergraph of any product
or of the Licensed Property, the disclosure of the Licensed
Property to a foreign national or any other activities
relating to the Licensed Property, Intergraph agrees that it
shall obtain any and all necessary or appropriate export
licenses, permits, or other authorizations and shall
otherwise comply with all statutes, regulations, or other
requirements of any governmental agency. Unigraphics agrees
to cooperate in good faith with Intergraph in this process.
Section 8. Proprietary Markings.
Intergraph shall not knowingly remove or alter any
proprietary or confidentiality markings (collectively, the
"Proprietary Rights Notices") placed by Unigraphics on any
of the master copies of the Licensed Property or any master
copies of Documentation received from or on behalf of
Unigraphics. Each copy of the Licensed Property shall
contain any and all Proprietary Rights Notices or other
notices giving credit to Unigraphics and/or any other third
party which appears on or in the Licensed Property or is
otherwise required by applicable law.
Section 9. Taxes.
Intergraph shall be liable for, and shall indemnify and
hold Unigraphics harmless from and against, all applicable
sales and use, value added, consumption, registration, stamp
and similar taxes imposed upon the Royalty ("Applicable
Taxes"). Applicable Taxes shall not include Unigraphics'
franchise taxes, income taxes, and other taxes based on net
or gross income. Intergraph agrees to pay to Unigraphics
any Applicable Taxes which Unigraphics is required to
collect and pay over to any taxing authority or provide
Unigraphics with a valid exemption certificate or other
documentary evidence of statutory exemption.
Section 10. Trademark License
No identifying mark (including, without limitation,
trade names, trademarks, trade devices, service marks or
symbols, abbreviations, contractions, or simulations
thereof) owned by or used to identify any product or service
of Unigraphics or any affiliate or subsidiary of Unigraphics
is expressly or by implication licensed hereby. The
respective rights as between Intergraph and Unigraphics
regarding the use of any identifying mark (including,
without limitation, trade names, trademarks, trade devices,
service marks or symbols, abbreviations, contractions, or
simulations thereof) owned by or used to identify any
product or service of Intergraph are set forth in that
certain Trademark License Agreement entered into between
Intergraph and Unigraphics of even date herewith.
Section 11. Confidentiality.
(a) Intergraph agrees to use the same means as it uses
to protect its confidential information, but in no event
less than reasonable means, to protect the confidentiality
of the Confidential Information, and Intergraph shall not
disclose any or all of the Confidential Information
(including, without limitation, source code, methods or
concepts utilized therein) to anyone, except to employees of
Intergraph, assignees, sublicensees and/or other third
parties to whom such disclosure is necessary or appropriate
and whom Intergraph has notified that such disclosure is
made and shall be kept confidential consistent with such
reasonable means. If information relating to the
Confidential Information at any time becomes available
without restriction to the general public by acts not
attributable to the Intergraph's employees, assignees,
sublicensees, and/or other third parties to whom disclosure
of such information was made, Intergraph's obligations under
this Section shall not continue to apply to such information
after such time.
(b) The obligations of Intergraph under this Section
shall survive and continue after any termination of rights
under this Agreement.
Section 12. Termination.
This Agreement may be terminated at anytime by an
express written agreement executed by both parties.
Section 13. Assignability.
The rights and obligations of Unigraphics and
Intergraph under this Agreement may be transferred (either
by operation of law or otherwise), assigned or sublicensed
only as follows:
(a) Intergraph or Unigraphics may grant to one or
more lenders a pledge, security interest, mortgage, lien,
conditional assignment or other similar interest in its
respective rights under this Agreement in connection with
any financing transaction undertaken in the ordinary course
of such party's business; provided, however, that any
lender, or transferee, assignee, or sublicensee of such
lender following foreclosure or realization on the
collateral by any such lender, shall meet the requirements
of Section 13(b) hereof; or
(b) Intergraph or Unigraphics may transfer,
assign or sublicense all or a part of its rights and
obligations under this Agreement to any person or entity
that agrees in writing to be bound by all terms, conditions
and restrictions substantially equivalent to those contained
in this Agreement; provided, however, that any such
transfer, assignment or sublicense shall not relieve either
Unigraphics or Intergraph of their respective obligations
and responsibilities under this Agreement; and provided
further, however, that Intergraph may only transfer, assign
or sublicense its rights under this Agreement to a successor
to its rights and obligations under the CAD-2 Contract.
Section 14. Arbitration.
In the event of any dispute or claim arising under or
in connection with this Agreement which the parties are
unable to resolve through informal discussions or
negotiation, the parties agree to submit such dispute or
claim to arbitration in accordance with the procedures set
forth in the Asset Purchase Agreement.
Section 15. General Provisions.
(a) This Agreement sets forth the entire agreement and
understanding between the parties as to the subject matter
hereof and merges all prior discussions between them, and
neither of the parties shall be bound by any conditions,
definitions, warranties, understandings, or representations
with respect to such subject matter other than as expressly
provided herein or as set forth in that certain Asset
Purchase Agreement or as set forth on or after the date
hereof in a writing signed by a duly authorized
representative of each party intending to be bound thereby.
(b) The headings found in this Agreement are for
reference purposes only and are to be given no effect in the
construction of this Agreement.
(c) This Agreement may be executed in one or more
counterparts, each of which shall be an original, but all of
which shall, together, constitute one and the same
instrument.
(d) If any provision of this Agreement or the
application of any such provision to any Person or
circumstance, shall be declared judicially to be invalid,
unenforceable or void, such decision shall not have the
effect of invalidating or voiding the remainder of this
Agreement, it being the intent and agreement of the parties
that this Agreement shall be deemed amended by modifying
such provision to the extent necessary to render it valid,
legal and enforceable while preserving its intent or, if
such modification is not possible, by substituting therefor
another provision that is legal and enforceable and that
achieves the same objective.
(e) The observance of any term of this Agreement may
be waived (either generally or in a particular instances and
either retroactively or prospectively) by the party entitled
to enforce such term, but such waiver shall be effective
only if it is in writing signed by the party against which
such waiver is to be asserted. Unless otherwise expressly
provided in this Agreement, no delay or omission on the part
of any party in exercising any right or privilege under this
Agreement shall operate as a waiver thereof, nor shall any
waiver on the part of any party of any right or privilege
under this Agreement operate as a waiver of any other right
or privilege under this Agreement nor shall any single or
partial exercise of any right or privilege preclude any
other or further exercise thereof or the exercise of any
other right or privilege under this Agreement.
(f) Neither party shall be liable for any loss or
delay resulting from any force majeure event, including,
without limitation, acts of God, fire, natural disaster,
labor stoppage, war or military hostilities, civil unrest,
or inability of carriers to make scheduled deliveries, and
any affected time period shall be extended to the extent of
any delay resulting from any force majeure event.
(g) The respective rights and obligations of the
parties hereunder shall indefinitely survive the termination
of this Agreement to the extent necessary to the intended
preservation of such rights and obligations or survival of
only specific provisions (e.g., confidentiality).
(h) The parties agree that this Agreement shall be
governed by and construed and interpreted in accordance with
the substantive laws of the State of Delaware, without
giving effect to principles relating to conflict of laws.
(i) Nothing in this Agreement is intended to require
Intergraph or Unigraphics to violate the proprietary or
intellectual property rights of any third party Person.
(j) Intergraph and Unigraphics each agree to execute
and deliver such further instruments and documents, and take
such further actions, as may be reasonably requested by the
other party in order to evidence more fully the transactions
contemplated by this Agreement, provided that such further
instruments and actions shall not, unless otherwise agreed,
require either party to incur any obligation in addition to
the obligations undertaken or assumed elsewhere in this
Agreement or in the Asset Purchase Agreement.
(k) Nothing in this Agreement is intended or shall be
construed to give any Person, other than the parties hereto,
any legal claim or equitable right, remedy, or claim under
or with respect to this Agreement or any provision contained
herein. The provisions set forth in this Agreement are for
the sole benefit of Unigraphics and Intergraph.
(l) Any notices or other communications required or
permitted to be given hereunder shall be given in accordance
with Section 10.6 of the Asset Purchase Agreement, which
Section 10.6 is incorporated by reference herein as though
set forth herein in full.
REMAINDER OF PAGE INTENTIONALLY LEFT BLANK
IN WITNESS WHEREOF, the parties hereto have caused this
License Agreement to be executed by their respective
authorized representatives as of the date first above
written.
INTERGRAPH CORPORATION,
a Delaware corporation
By: /s/ John W. Wilhoite
--------------------
John W. Wilhoite, Vice President
UNIGRAPHICS SOLUTIONS INC.,
a Delaware corporation
By: /s/ H. Timothy Hatfield
-----------------------
H. Timothy Hatfield, Vice President
LICENSE AGREEMENT
("EMS Code")
THIS AGREEMENT (this "Agreement"), dated as of March 2,
1998 (the "Effective Date"), by and between Intergraph
Corporation, a Delaware corporation having its principal
place of business at One Madison Industrial Park,
Huntsville, Alabama 35894 ("Intergraph") and Unigraphics
Solutions Inc., a Delaware corporation having its principal
place of business at 13736 Riverport Drive, Maryland
Heights, Missouri 63043 ("Unigraphics").
W I T N E S S E T H :
WHEREAS, contemporaneously herewith, Intergraph and
Unigraphics and certain of their respective affiliates have
executed and delivered that certain Asset Purchase Agreement
dated March 2, 1998 (the "Asset Purchase Agreement") with
respect to the sale, transfer, or license by Intergraph to
Unigraphics of certain assets, including certain assets
relating to the Intergraph EMS Business (as defined herein);
WHEREAS, pursuant to the Asset Purchase Agreement,
Intergraph has transferred, sold, assigned, and conveyed
certain assets, including the Intergraph EMS Business but
has retained all obligations to sell Intergraph EMS Products
and to provide support, training and maintenance for
Intergraph EMS Products to certain agencies of the
Government of the United States of America (including,
without limitation, the U.S. Department of the Navy)
pursuant to the CAD-2 Contract (as defined herein) and to
sell, support, maintain, and provide training with respect
to certain Shipbuilding Contracts (as defined herein);
WHEREAS, Intergraph and Unigraphics have recognized and
agreed that Intergraph will not and has not assigned and
conveyed any Shipbuilding Contracts to Unigraphics and
Intergraph shall have the continuing right to enter into and
perform current and future Shipbuilding Contracts and that
the CAD-2 Contract is not assignable or transferrable by
Intergraph to Unigraphics and requires Intergraph to
continue to have the ability to sell, maintain, and support
the EMS Products during the entire term of the CAD-2
Contract, and any extensions or renewals thereof;
WHEREAS, Unigraphics intends to make the Licensed
Property (as defined in herein) available to and to license
Intergraph to use the Licensed Property pursuant to the
terms and conditions of this Agreement, and Unigraphics
intends to reserve and retain ownership of and rights in the
Licensed Property;
WHEREAS, Unigraphics desires to grant to Intergraph and
Intergraph desires to receive from Unigraphics a license
with respect to the Licensed Property, in all events solely
and exclusively upon the terms and conditions set forth
herein; and
WHEREAS, Unigraphics desires to retain and reserve
ownership of and other rights in the Licensed Property and
Intergraph desires to agree to such retention and
reservation of rights in the Licensed Property by
Unigraphics, in all events solely and exclusively upon the
terms and conditions set forth herein;
NOW, THEREFORE, in consideration of the mutual
promises, covenants, and agreements set forth herein and
other good and valuable consideration, including, without
limitation the execution and delivery of the Asset Purchase
Agreement, the receipt and adequacy of which is hereby
acknowledged, Intergraph and Unigraphics, intending to be
legally bound, hereby agree as follows:
Section 1. Definitions.
Capitalized terms used in this Agreement shall have the
meanings provided in the Asset Purchase Agreement, except
the capitalized terms listed below which shall have the
following meanings:
(a) Adaptation shall mean any work incorporating any
EMS Code (whether directly or indirectly), including,
without limitation, any modified, altered, or amended
version of the EMS Code (but not any modification,
alteration, or amendment of the EMS Code which, under
applicable law, constitutes a derivative work), or any work
utilizing a method or concept from the EMS Code.
(b) CAD-2 Contract shall mean, collectively, those
certain agreements (as such may be amended, extended,
renewed, or modified from time to time through September 30,
2006) to sell, support, and maintain end users who have or
may purchase a license to use the Licensed Property between
Intergraph and the Government of the United States of
America as follows:
(i) Contract Number N66032-91-D-0003, dated April
8, 1991;
(ii) Contract Number N66032-93-D-0021, dated
August 30, 1993; and
(iii) Contract Number N66032-94-D-0012, dated
July 13, 1994.
(c) CAD-2 Customers shall mean the end-user customers
who have purchased or who may purchase a license to use the
Licensed Property in accordance with the CAD-2 Contract.
(d) Confidential Information shall mean any data,
source code, trade secrets, documentation, notes, or
information (oral or written) heretofore created, developed,
controlled, possessed, or obtained by Unigraphics or
exchanged between the parties, and treated as confidential
and so identified, that concerns the EMS Acquired Assets or
relates in any manner to technical or business aspects of
the EMS Acquired Assets as used or exists in the Intergraph
EMS Business. Notwithstanding the foregoing, Confidential
Information will not be deemed to include information that
is (i) publicly available or in the public domain at the
time disclosed, (ii) or becomes publicly available or enters
the public domain through no fault of the party receiving
such information, (iii) rightfully communicated to the
recipient by persons not bound by confidentiality
obligations with respect thereto, (iv) already in the
recipient's possession free of any confidentiality
obligations with respect thereto at the time of disclosure,
(v) approved by the disclosing party for release or
disclosure without restriction.
(e) Copyright(s) shall mean all copyright interests in
the EMS Acquired Assets and Documentation acquired by
Unigraphics from Intergraph pursuant to the Asset Purchase
Agreement, including, without limitation, all common-law
rights.
(f) Development Environment shall mean any
programming, documentation, and media acquired by
Unigraphics from Intergraph pursuant to the Asset Purchase
Agreement for the development, maintenance, testing and
implementation of the EMS Code, solely and exclusively to
the extent such objects may be practically required by
Intergraph for any subsequent maintenance, testing or
enhancement of the EMS Code pursuant to this Agreement or
related programming by Intergraph, in all events, for
performance of the CAD-2 Contract or any Shipbuilding
Contract, provided, however that "Development Environment"
shall not include the BAG Products or the INGR Tools (as the
BAG Products and the INGR Tools are defined, respectively,
in that certain BAG Products License Agreement and in that
certain INGR Tools License Agreement (as each such agreement
is defined in the Asset Purchase Agreement)), or the LTS
Tools.
(g) Documentation shall mean all written materials
(including, design documentation, user documentation, and
program documentation) acquired by Unigraphics from
Intergraph pursuant to the Asset Purchase Agreement for use,
distribution, and/or maintenance of the EMS Code.
(h) EMS Acquired Assets shall mean the EMS Code and
the trademarks associated therewith which comprise a part of
the Intergraph EMS Business which Unigraphics has acquired,
among other things, from Intergraph on the date hereof
pursuant to the Asset Purchase Agreement.
(i) EMS Code shall mean that certain source code
which, on the Effective Date, is used in the Intergraph EMS
Products but does not comprise one of the Bag Tools. The
approximately 26 eight-millimeter tapes delivered to
Unigraphics pursuant to Section 4 hereof and the
descriptions on Schedule 1 attached hereto and incorporated
by reference herein provide the parties' best identification
of the EMS Code as of the Effective Date.
(j) EMS Product shall mean the EMS products offered,
distributed and/or sold by Unigraphics or Intergraph, from
time to time.
(k) Intergraph Fields shall mean the following
specific fields:
A. performance of each and every CAD-2
Contract (including, without
limitation, sales of Intergraph EMS
Products to CAD-2 Customers and all
training, maintenance, and support
related thereto); and
B. performance of any and all
Shipbuilding Contracts (including,
without limitation, sales of
Intergraph EMS Products to
Shipbuilding Customers and all
training, maintenance, and support
related thereto).
(l) Intergraph EMS Business shall mean Intergraph's
EMS Products and line of business, as such exist on the
Effective Date immediately before the Principal Closing of
the Asset Purchase Agreement.
(m) Licensed Property shall mean the EMS Code, as such
exists on the Effective Date, including the expressions of
an organized set of instructions in a natural or coded
language which are contained on physical media of any nature
(e.g., written, electronic, magnetic, optical, or otherwise)
and which may be used with a computer or other automated
data processing equipment device of any nature which is
based on digital technology, to make such computer or other
device operate in a particular manner and for a particular
purpose, as well as any related Documentation for such set
of instructions; and "Licensed Property" shall include
computer programs in source and object code, test and other
significant data libraries, Documentation for such computer
programs and any of the following components which is
contained on a physical media of any nature and which is
used in the design, development, modification, enhancement,
testing, installation, maintenance, diagnosis, or assurance
of the performance of the EMS Code (collectively, the
"Miscellaneous Software Components"): processes,
techniques, algorithms, symbologies, interfaces,
calculations, models, narrative descriptions, notes,
specifications, designs, flow charts, parameters or
descriptions, logic flow diagrams, masks, input and output
formats, file layouts, data base formats, test programs,
test or other data, user guidelines, manuals, installation
and operating instructions, diagnostic and maintenance
instructions, source code, object code, and other similar
materials and information; and "Licensed Property" shall
further include all Confidential Information, Adaptations,
and Copyrights, in all events as such exists on the
Effective Date, which were included in the Intergraph EMS
Business, which Unigraphics acquired from Intergraph
pursuant to the Asset Purchase Agreement, and which are
necessary for the use or execution of the EMS Acquired
Assets or any Miscellaneous Software Components. To the
extent that Unigraphics has the authority to do so without
incurring any material obligation (but not otherwise), the
Licensed Property shall include a non-exclusive, royalty-
free license to any part of the Development Environment for
the Licensed Property that is owned by Unigraphics or its
Affiliates or is not commercially available elsewhere, in
all events as such exists on the Effective Date and subject
to the other terms and conditions set forth herein.
Notwithstanding anything to the contrary appearing in this
Section 1(m), the Licensed Property shall not include any
Third-Party Software incorporated or embedded in, or
compiled or combined with, the Licensed Property and/or the
Development Environment (except that described on Schedule
1(m) hereto), any Patent Rights, the BAG Products, the INGR
Tools, or LTS Tools.
(n) Patent Rights shall mean all domestic and foreign
patents (including, without limitation, certificates of
invention and other patent equivalents), provisional
applications, patents issuing therefrom, any division or
continuation, re-issue, extension, revival, or renewal of
any patent or invention.
(o) Product shall mean the products offered,
distributed, or sold by Intergraph, from time to time.
(p) Shipbuilding Contract shall mean an agreement
(whether now or hereafter in effect, and all amendments,
modifications, extensions, and renewals thereof or thereto)
to grant an end-user license (excluding any Confidential
Information) (and all related support, training,
enhancements, and maintenance) in any or all of the Licensed
Property only for use with the Intergraph Vehicle Design
System Products to any Person for the purpose of designing,
constructing, renovating, rehabilitating, re-fitting,
adapting, or modifying a marine vessel, including, without
limitation, tankers, cruisers, battleships, aircraft
carriers, submarines, freighters, and other merchant marine
vessels, ferries, river and ocean going barges and tugboats.
(q) Shipbuilding Customers shall mean the end-user
customers who have or may purchase a license to use the
Licensed Property (excluding any Confidential Information)
pursuant to a Shipbuilding Contract.
(r) Third-Party Software shall mean computer software
or other technology in which any Person, other than the
Selling Entities or any other subsidiaries of Intergraph,
has any right, title, or interest, including any
restrictions or obligations (such as, obligations to obtain
consents or approvals, and restrictions that may be
eliminated only by obtaining such consents or approvals)
applicable to the Licensed Property.
Section 2. Ownership of Licensed Property.
The Licensed Property is the property of and is owned
by Unigraphics and title shall remain vested in Unigraphics.
Intergraph acknowledges and agrees that the Licensed
Property is comprised of trade secrets, proprietary
information, and other Confidential Information, whether or
not any portion thereof is or may be copyrightable or
patented, and that Intergraph will not use, distribute,
copy, perform, amend, alter, modify, exploit, sublicense or
assign the Licensed Property, or permit any such to occur,
except as expressly and specifically permitted in by this
Agreement.
Section 3. License and Retained Rights.
(a) Unigraphics hereby grants to Intergraph an
exclusive, world-wide, transferable (to the extent permitted
by Section 13 hereof) license of the Licensed Property in
the Intergraph Fields for any purpose whatsoever (the
"License"), which License shall be for the period beginning
the Effective Date through and including September 30, 2006,
or the expiration or termination of all of Intergraph's
obligations under the CAD-2 Contract, whichever shall first
occur, with respect to the CAD-2 Contract in the Intergraph
Fields and shall be perpetual with respect to the
Shipbuilding Contracts in the Intergraph Fields. Intergraph
hereby accepts the License. Unigraphics agrees that it
shall not have any right to use the Licensed Property in the
Intergraph Fields.
(b) Nothing contained in this Agreement shall be
construed as conferring by implication, estoppel, or
otherwise any license or right under any confidential
information, patent, copyright, trade secret, or other
intellectual property, which is not expressly granted
hereunder.
(c) Intergraph shall pay to Unigraphics a royalty
equal to one hundred percent (100%) of Intergraph's net
sales price on sales of Intergraph EMS Products under any
CAD-2 Contract and a royalty equal to fifty percent (50%) of
Intergraph's net sales price on sales of Intergraph EMS
Products under any Shipbuilding Contract (collectively, the
"Royalty"). Intergraph shall be responsible for and shall
retain all revenue for training and maintenance under any
CAD-2 Contract or Shipbuilding Contract. The Royalty shall
be payable on or before the fifteenth (15th) calendar day
after the end of each calendar quarter and shall be
accompanied by a written report of the total revenue from
sales of Intergraph EMS Products with respect to the CAD-2
Contract and to Shipbuilding Contracts. Unigraphics shall
have the right to audit the records of Intergraph with
respect to the sales of Intergraph EMS Products to CAD-2
Customers and to Shipbuilding Customers (which records shall
be deemed to be included in the Confidential Information (as
defined herein)) no more frequently than once each calendar
year, shall give Intergraph reasonable notice of any such
audit, and shall conduct all such audits during Intergraph's
usual business hours. If any such audit results in an under-
payment of more than ten percent (10%) of the total Royalty
that should have been paid during the period subject to such
audit, Intergraph shall bear the cost of such audit and
shall pay to Unigraphics the amount of such underpayment
within ten (10) days following the completion of such audit,
otherwise Unigraphics shall pay all costs associated with
such audit. If Intergraph has overpaid the Royalty,
Unigraphics shall pay Intergraph the amount of such
overpayment within ten (10) days following completion of
such audit. Intergraph shall preserve its records relating
to its sales of Intergraph Solid Edge Products for a period
of two years. If requested by Intergraph, Unigraphics shall
make the results of any such audit available to Intergraph.
Neither the execution of this Agreement, the granting of the
License, nor Intergraph's use or exploitation of the
Licensed Property shall be construed as an obligation of
Unigraphics to furnish any Person (including, without
limitation, Intergraph) any assistance of any kind
whatsoever; or any enhancements, adaptations, improvements,
modifications, corrections, documentation, support,
training, installation or maintenance with respect to the
Licensed Property or any portion thereof, information or
documentation, other than as expressly provided herein,
provided, however, that Unigraphics shall deliver to
Intergraph all "bug fixes" which Unigraphics makes at its
sole discretion to the EMS Code.
(d) To the extent that Intergraph creates any
derivative work using or incorporating the Licensed Property
by customizing, enhancing, modifying, or altering any or all
portions of the Licensed Property after the Effective Date,
those portions of each such derivative work which do not
constitute Licensed Property shall be considered separate
and independent derivative works with respect to which
Intergraph shall retain all right, title, and interest,
including, without limitation, the right to seek separate
copyright registration for such derivative work in
accordance with applicable law; provided, however, that such
copyright registration shall identify the Licensed Property
as copyrightable subject matter from which the derivative
work was derived. Intergraph shall have no obligation to
provide information concerning, make available, or grant any
right in any such derivative work to Unigraphics. All
derivative works based on the Licensed Property and created
by Intergraph shall be subject to the field of use
restrictions of Section 3(a) as though such derivative works
were Licensed Property.
(e) Notwithstanding any other provision of this
Agreement to the contrary, nothing herein shall be construed
to create a partnership or joint venture between the
parties, to authorize either party to act as agent for the
other, to permit either party to undertake any agreement for
the other, or to use the name or identifying mark or marks
of the other, all except as expressly provided herein or in
other agreements between or among the parties.
(g) Intergraph and Unigraphics, each, agree that it
will not assume any obligation or undertake any action which
is inconsistent with this Agreement.
Section 4. Delivery; Information Exchange.
At the Principal Closing, Intergraph shall deliver to
Unigraphics and shall retain a master copy of the EMS Code
source code in the form of approximately 26 eight-millimeter
tapes containing all directories for the EMS Code, together
with their files, folders, data, information, and source
code, Documentation, any other relevant documentation or
media that evidences or supports the EMS Code and the other
EMS Acquired Assets and all other tangible property
comprising Licensed Property, in all events as such exists
on the Effective Date, such Documentation and media shall
include, to the extent the same exists, system
documentation, statements of principles of operation, and
schematics for the Licensed Property, as well as any
pertinent commentary or explanation that may be necessary to
render the Licensed Property understandable and usable by a
trained computer programmer. Intergraph shall hold such
master copy of the EMS Code as Confidential Information.
Section 5. Term.
This Agreement shall become effective on the Effective
Date and, except as expressly provided herein, shall remain
in force in perpetuity (or for the longest period otherwise
permitted by law), unless earlier terminated or expires in
accordance with this Agreement.
Section 6. Indemnification and Protection of Licensed
Property; Disclaimer of Certain Warranties.
(a) The indemnification provisions set forth in
Article IX of the Asset Purchase Agreement are incorporated
by reference herein as though set forth in full herein, to
the extent such indemnification provisions apply to the
Licensed Property or to this Agreement.
(b) UNIGRAPHICS HEREBY DISCLAIMS ALL EXPRESS OR
IMPLIED WARRANTIES INCLUDING, WITHOUT LIMITATION, THE
WARRANTIES OF MERCHANTABILITY AND FITNESS FOR A PARTICULAR
PURPOSE.
INTERGRAPH ACKNOWLEDGES AND AGREES THAT (i) PRIOR TO
THE EFFECTIVE DATE THE LICENSED PROPERTY HAS BEEN AVAILABLE
TO AND USED BY THE EMPLOYEES OF INTERGRAPH, (ii) INTERGRAPH
IS RETAINING THE LICENSED PROPERTY "AS IS, WHERE IS," (iii)
INTERGRAPH HAS HAD REASONABLE OPPORTUNITY TO TEST ANY
SOFTWARE INCLUDED WITH THE LICENSED PROPERTY IN A MANNER AND
WITH SUCH METHODS AS INTERGRAPH HAS DEEMED NECESSARY, AND
(iv) BY EXECUTING THIS AGREEMENT, INTERGRAPH ACCEPTS THE
LICENSED PROPERTY AS CONFORMING TO INTERGRAPH'S NEEDS AND
REQUIREMENTS.
NOTWITHSTANDING THE FOREGOING, REPRESENTATIONS AND
WARRANTIES IN THE ASSET PURCHASE AGREEMENT SHALL NOT BE
DIMINISHED OR CHANGED IN ANY WAY HEREBY.
Section 7. Export Requirements.
With respect to the export by Intergraph of any product
or of the Licensed Property, the disclosure of the Licensed
Property to a foreign national or any other activities
relating to the Licensed Property, Intergraph agrees that it
shall obtain any and all necessary or appropriate export
licenses, permits, or other authorizations and shall
otherwise comply with all statutes, regulations, or other
requirements of any governmental agency. Unigraphics agrees
to cooperate in good faith with Intergraph in this process.
Section 8. Proprietary Markings.
Intergraph shall not knowingly remove or alter any
proprietary or confidentiality markings (collectively, the
"Proprietary Rights Notices") placed by Unigraphics on any
of the master copies of the Licensed Property or any master
copies of Documentation received from or on behalf of
Unigraphics. Each copy of the Licensed Property shall
contain any and all Proprietary Rights Notices or other
notices giving credit to Unigraphics and/or any other third
party which appears on or in the Licensed Property or is
otherwise required by applicable law.
Section 9. Taxes.
Intergraph shall be liable for, and shall indemnify and
hold Unigraphics harmless from and against, all applicable
sales and use, value added, consumption, registration, stamp
and similar taxes imposed upon the Royalty ("Applicable
Taxes"). Applicable Taxes shall not include Unigraphics'
franchise taxes, income taxes, and other taxes based on net
or gross income. Intergraph agrees to pay to Unigraphics
any Applicable Taxes which Unigraphics is required to
collect and pay over to any taxing authority or provide
Unigraphics with a valid exemption certificate or other
documentary evidence of statutory exemption.
Section 10. Trademark License
No identifying mark (including, without limitation,
trade names, trademarks, trade devices, service marks or
symbols, abbreviations, contractions, or simulations
thereof) owned by or used to identify any product or service
of Unigraphics or any affiliate or subsidiary of Unigraphics
is expressly or by implication licensed hereby. The
respective rights as between Intergraph and Unigraphics
regarding the use of any identifying mark (including,
without limitation, trade names, trademarks, trade devices,
service marks or symbols, abbreviations, contractions, or
simulations thereof) owned by or used to identify any
product or service of Intergraph are set forth in that
certain Trademark License Agreement entered into between
Intergraph and Unigraphics of even date herewith.
Section 11. Confidentiality.
(a) Intergraph agrees to use the same means as it uses
to protect its confidential information, but in no event
less than reasonable means, to protect the confidentiality
of the Confidential Information, and Intergraph shall not
disclose any or all of the Confidential Information
(including, without limitation, source code, methods or
concepts utilized therein) to anyone, except to employees of
Intergraph, assignees, sublicensees and/or other third
parties to whom such disclosure is necessary or appropriate
and whom Intergraph has notified that such disclosure is
made and shall be kept confidential consistent with such
reasonable means. If information relating to the
Confidential Information at any time becomes available
without restriction to the general public by acts not
attributable to the Intergraph's employees, assignees,
sublicensees, and/or other third parties to whom disclosure
of such information was made, Intergraph's obligations under
this Section shall not continue to apply to such information
after such time.
(b) The obligations of Intergraph under this Section
shall survive and continue after any termination of rights
under this Agreement.
Section 12. Termination.
This Agreement may be terminated at anytime by an
express written agreement executed by both parties.
Section 13. Assignability.
The rights and obligations of Unigraphics and
Intergraph under this Agreement may be transferred (either
by operation of law or otherwise), assigned or sublicensed
only as follows:
(a) Intergraph or Unigraphics may grant to one or
more lenders a pledge, security interest, mortgage, lien,
conditional assignment or other similar interest in its
respective rights under this Agreement in connection with
any financing transaction undertaken in the ordinary course
of such party's business; provided, however, that any
lender, or transferee, assignee, or sublicensee of such
lender following foreclosure or realization on the
collateral by any such lender, shall meet the requirements
of Section 13(b) hereof; or
(b) Intergraph or Unigraphics may transfer,
assign or sublicense all or a part of its rights and
obligations under this Agreement to any person or entity
that agrees in writing to be bound by all terms, conditions
and restrictions substantially equivalent to those contained
in this Agreement; provided, however, that any such
transfer, assignment or sublicense shall not relieve either
Unigraphics or Intergraph of their respective obligations
and responsibilities under this Agreement; and provided
further, however, that Intergraph may only transfer, assign
or sublicense its rights under this Agreement to a successor
(or a sublicensee which is an Affiliate) to its rights and
obligations under the CAD-2 Contract.
Section 14. Arbitration.
In the event of any dispute or claim arising under or
in connection with this Agreement which the parties are
unable to resolve through informal discussions or
negotiation, the parties agree to submit such dispute or
claim to arbitration in accordance with the procedures set
forth in the Asset Purchase Agreement.
Section 15. General Provisions.
(a) This Agreement sets forth the entire agreement and
understanding between the parties as to the subject matter
hereof and merges all prior discussions between them, and
neither of the parties shall be bound by any conditions,
definitions, warranties, understandings, or representations
with respect to such subject matter other than as expressly
provided herein or as set forth in that certain Asset
Purchase Agreement or as set forth on or after the date
hereof in a writing signed by a duly authorized
representative of each party intending to be bound thereby.
(b) The headings found in this Agreement are for
reference purposes only and are to be given no effect in the
construction of this Agreement.
(c) This Agreement may be executed in one or more
counterparts, each of which shall be an original, but all of
which shall, together, constitute one and the same
instrument.
(d) If any provision of this Agreement or the
application of any such provision to any Person or
circumstance, shall be declared judicially to be invalid,
unenforceable or void, such decision shall not have the
effect of invalidating or voiding the remainder of this
Agreement, it being the intent and agreement of the parties
that this Agreement shall be deemed amended by modifying
such provision to the extent necessary to render it valid,
legal and enforceable while preserving its intent or, if
such modification is not possible, by substituting therefor
another provision that is legal and enforceable and that
achieves the same objective.
(e) The observance of any term of this Agreement may
be waived (either generally or in a particular instances and
either retroactively or prospectively) by the party entitled
to enforce such term, but such waiver shall be effective
only if it is in writing signed by the party against which
such waiver is to be asserted. Unless otherwise expressly
provided in this Agreement, no delay or omission on the part
of any party in exercising any right or privilege under this
Agreement shall operate as a waiver thereof, nor shall any
waiver on the part of any party of any right or privilege
under this Agreement operate as a waiver of any other right
or privilege under this Agreement nor shall any single or
partial exercise of any right or privilege preclude any
other or further exercise thereof or the exercise of any
other right or privilege under this Agreement.
(f) Neither party shall be liable for any loss or
delay resulting from any force majeure event, including,
without limitation, acts of God, fire, natural disaster,
labor stoppage, war or military hostilities, civil unrest,
or inability of carriers to make scheduled deliveries, and
any affected time period shall be extended to the extent of
any delay resulting from any force majeure event.
(g) The respective rights and obligations of the
parties hereunder shall indefinitely survive the termination
of this Agreement to the extent necessary to the intended
preservation of such rights and obligations or survival of
only specific provisions (e.g., confidentiality).
(h) The parties agree that this Agreement shall be
governed by and construed and interpreted in accordance with
the substantive laws of the State of Delaware, without
giving effect to principles relating to conflict of laws.
(i) Nothing in this Agreement is intended to require
Intergraph or Unigraphics to violate the proprietary or
intellectual property rights of any third party Person.
(j) Intergraph and Unigraphics each agree to execute
and deliver such further instruments and documents, and take
such further actions, as may be reasonably requested by the
other party in order to evidence more fully the transactions
contemplated by this Agreement, provided that such further
instruments and actions shall not, unless otherwise agreed,
require either party to incur any obligation in addition to
the obligations undertaken or assumed elsewhere in this
Agreement or in the Asset Purchase Agreement.
(k) Nothing in this Agreement is intended or shall be
construed to give any Person, other than the parties hereto,
any legal claim or equitable right, remedy, or claim under
or with respect to this Agreement or any provision contained
herein. The provisions set forth in this Agreement are for
the sole benefit of Unigraphics and Intergraph.
(l) Any notices or other communications required or
permitted to be given hereunder shall be given in accordance
with Section 10.6 of the Asset Purchase Agreement, which
Section 10.6 is incorporated by reference herein as though
set forth in full herein.
IN WITNESS WHEREOF, the parties hereto have caused this
License Agreement to be executed by their respective
authorized representatives as of the date first above
written.
INTERGRAPH CORPORATION,
a Delaware corporation
By: /s/ John W. Wilhoite
--------------------
John W. Wilhoite, Vice President
UNIGRAPHICS SOLUTIONS INC.,
a Delaware corporation
By: /s/ H. Timothy Hatfield
-----------------------
H. Timothy Hatfield, Vice President
TRADEMARK LICENSE AGREEMENT
("CAD-2 Contract and Shipbuilding Contracts")
THIS AGREEMENT made and entered into as of March 2, 1998, by and
between Intergraph Corporation, a Delaware corporation having its
principal place of business at One Madison Industrial Park,
Huntsville, Alabama 35894 ("Intergraph"), and Unigraphics Solutions
Inc., a Delaware corporation having its principal place of business at
13736 Riverport Drive, Maryland Heights, Missouri 63043
("Unigraphics").
W I T N E S S E T H:
WHEREAS, contemporaneously herewith, Intergraph and Unigraphics
and certain of their respective affiliates have executed and delivered
that certain Asset Purchase Agreement dated March 2, 1998 (the "Asset
Purchase Agreement") with respect to the sale, transfer, or license by
Intergraph to Unigraphics of certain assets relating to the Business
(as defined in the Asset Purchase Agreement);
WHEREAS, contemporaneously herewith, Intergraph and Unigraphics
and certain of their respective affiliates have executed and delivered
that certain EMS License Agreement and that certain Solid Edge
Specific Code License Agreement which are Exhibit H-1 and Exhibit H-2,
respectively, to the Asset Purchase Agreement (collectively, the
"License Agreements");
WHEREAS, Unigraphics is the owner of various Trademarks which
have been registered with the United States Patent & Trademarks Office
as set forth on Exhibit 1 attached hereto, and Unigraphics claims
common law rights in and to certain Trademarks as set forth in Exhibit
1 attached hereto, all of which Trademarks Unigraphics has acquired
from Intergraph pursuant to the Asset Purchase Agreement
(collectively, the "Trademarks");
WHEREAS, Intergraph desires to use the Trademarks in connection
with the exclusive and non-exclusive licenses granted by Intergraph
pursuant to the respective License Agreements in Intergraph's
performance of the CAD-2 Contract and Shipbuilding Contracts described
therein ("business purpose"); and
WHEREAS, Unigraphics is willing to grant permission to Intergraph
to use the Trademarks in connection with activities pursuant to the
Asset Purchase Agreement and the respective License Agreements;
NOW, THEREFORE, in consideration of the premises, and other good
and valuable consideration received, the receipt and sufficiency of
which is hereby acknowledged, Intergraph and Unigraphics agree as
follows:
ARTICLE I. DEFINITIONS, LICENSE, AND TERM
1. Definitions.
For the purposes of this Agreement, the following terms shall
have the meaning set forth below:
(a) Capitalized terms used in this Agreement shall have the
meanings provided in the Asset Purchase Agreement, except the
capitalized term listed below which shall have the meaning set forth
opposite such term:
(b) "Product" shall mean the Intergraph service or services
or product or products developed, sold, and/or marketed by Intergraph
in connection with its performance of the CAD-2 Contract or
Shipbuilding Contracts, in both cases pursuant to the License
Agreements.
1.2 License.
In accordance with this Agreement, Unigraphics hereby grants to
Intergraph a non-exclusive, world-wide, royalty-free, nontransferable
license to the Trademarks which are described in detail in Exhibit 1
attached hereto and incorporated by reference herein, for Intergraph's
use to represent any Product which is substantially the same as the
goods and services offered and sold by Intergraph in connection with
each Trademark immediately before the Principal Closing as part of
Intergraph's business purpose regarding the License Agreements (the
"License").
1.3 Term.
The term of this Agreement shall commence on the Effective Date
and, with respect to each Trademark, shall continue in effect so long
as Intergraph's obligations under any CAD-2 Contract or Shipbuilding
Contracts continue (the "Term").
ARTICLE II. OWNERSHIP AND USE OF TRADEMARK LICENSE
2.1 Ownership of Trademarks.
As between Intergraph and Unigraphics, Unigraphics is the
exclusive owner of the Trademarks. Intergraph acknowledges the
substantial value of the goodwill associated with the Trademarks and
that the Trademarks and all rights therein and the goodwill pertaining
thereto belong solely and exclusively to Unigraphics. Under no
circumstances shall any provision of this Agreement be construed as
granting, by implication, estoppel, or otherwise, a license to any of
Unigraphics' technology, proprietary rights, software, or other
intellectual property, other than the permitted use of each Trademark
pursuant to Section 1.2 hereof.
2.2 Quality, Inspection, and Approval.
Intergraph covenants and agrees that:
(a) Intergraph shall maintain the quality of each Product
used in connection with each Trademark at a level that meets or
exceeds industry standards as such are applied to the CAD-2 Contract
and Shipbuilding Contracts, and each Product shall meet the applicable
quality standards described in this Agreement;
(b) Intergraph shall supply Unigraphics with suitable
specimens of each Product and Intergraph's use of each Trademark in
connection with such Product at the times and in the manner reasonably
requested by Unigraphics; and Intergraph shall cooperate fully with
Unigraphics to facilitate periodic review of Intergraph's use of each
Trademark and of Intergraph's compliance with the quality standards
described in this Agreement. All specimens shall be used for purposes
of quality control and review under this Agreement and shall be
returned within 60 days;
(c) Intergraph shall remedy any failure to meet the
standards established by this Section 2.2(a) upon reasonable notice
from Unigraphics;
(d) Intergraph shall promptly notify Unigraphics of any
suspected infringement of or challenge to any Trademark. Intergraph
shall not knowingly violate or infringe any trademark right of any
third party through its use of the Trademarks. Nothing herein shall
be interpreted to diminish or change any provision of the Asset
Purchase Agreement, including but not limited to the representations
and warranties and indemnification provisions contained therein.
2.3 Identification and Use.
(a) Intergraph shall comply with all applicable laws,
rules, and regulations relating to the use of the Trademarks and
Intergraph shall mark every use of each Trademark with the trademark
designations required by applicable law or as Unigraphics may
reasonably request from time to time and shall reasonably comply with
Unigraphics' trademark use guidelines for the respective Trademarks,
as such may exist from time to time. Intergraph shall mark all
packaging and advertising materials with proper trademark notice.
(b) Intergraph acknowledges Unigraphics' ownership of each
Trademark, shall use each Trademark solely as provided in this
Agreement and in a manner that will not derogate from Unigraphics'
rights in such Trademark, and shall take no action that will interfere
with or diminish Unigraphics' rights in such Trademark (including,
diminishing Unigraphics' goodwill in a Trademark or using a Trademark
in a manner that is likely to result in confusion with any use of such
Trademark by Unigraphics or of any other mark by Unigraphics), during
the term of this Agreement. Intergraph agrees not to adopt, use, or
register any corporate name, trade name, trademark, service mark, or
certification mark, or other designation confusingly similar to or
containing in whole or in part any Trademark. Notwithstanding the
foregoing sentence, Intergraph's use of any current or future
trademark, service mark, certification mark, or other designation
which include "SMART" as a component (e.g., SMARTSKETCH, SMART PLAN
EXPLORER) shall not be deemed to violate this Agreement. Intergraph
agrees that all use of any Trademark by Intergraph will inure to the
benefit of Unigraphics. Intergraph shall not use any Trademark in any
way as an endorsement or sponsorship of any product of Unigraphics.
2.4 Reversion of Rights.
Upon and after the expiration or termination of this Agreement,
the License and all rights granted to Intergraph hereunder shall
immediately and forthwith revert to Unigraphics without any further
action by or on behalf of Unigraphics, and all goodwill pertaining
thereto shall belong to Unigraphics, and Intergraph shall discontinue
and refrain from further use of any Trademark or any further reference
to it (whether direct or indirect) or use of any mark deemed by
Unigraphics to be confusingly similar to any Trademark in connection
with the manufacture, sale, or distribution of any product or any good
and service otherwise manufactured, sold, or distributed by
Unigraphics.
2.5 Assignability.
The rights and obligations of Intergraph under this Agreement are
personal and may not be transferred (either by operation of law or
otherwise), assigned or sublicensed, including but not limited to the
grant of any security interest, and any such transfer shall render the
License void and unenforceable.
ARTICLE III. MISCELLANEOUS
3.1 Arbitration.
In the event of any dispute or claim arising under or in
connection with this Agreement which the parties are unable to resolve
through informal discussions or negotiation, the parties agree to
submit such dispute or claim to arbitration in accordance with the
procedures set forth in the Asset Purchase Agreement.
3.2 General Provisions.
(a) This Agreement sets forth the entire agreement and
understanding between the parties as to the subject matter hereof and
merges all prior discussions between them, and neither of the parties
shall be bound by any conditions, definitions, warranties,
understandings, or representations with respect to such subject matter
other than as expressly provided herein or as set forth in that
certain Asset Purchase Agreement or as set forth on or after the date
hereof in a writing signed by a duly authorized representative of each
party intending to be bound thereby.
(b) The headings found in this Agreement are for reference
purposes only and are to be given no effect in the construction of
this Agreement.
(c) This Agreement may be executed in one or more
counterparts, each of which shall be an original, but all of which
shall, together, constitute one and the same instrument.
(d) If any provision of this Agreement or the application
of any such provision to any Person or circumstance, shall be declared
judicially to be invalid, unenforceable or void, such decision shall
not have the effect of invalidating or voiding the remainder of this
Agreement, it being the intent and agreement of the parties that this
Agreement shall be deemed amended by modifying such provision to the
extent necessary to render it valid, legal and enforceable while
preserving its intent or, if such modification is not possible, by
substituting therefor another provision that is legal and enforceable
and that achieves the same objective.
(e) The observance of any term of this Agreement may be
waived (either generally or in a particular instances and either
retroactively or prospectively) by the party entitled to enforce such
term, but such waiver shall be effective only if it is in writing
signed by the party against which such waiver is to be asserted.
Unless otherwise expressly provided in this Agreement, no delay or
omission on the part of any party in exercising any right or privilege
under this Agreement shall operate as a waiver thereof, nor shall any
waiver on the part of any party of any right or privilege under this
Agreement operate as a waiver of any other right or privilege under
this Agreement nor shall any single or partial exercise of any right
or privilege preclude any other or further exercise thereof or the
exercise of any other right or privilege under this Agreement.
(f) Neither party shall be liable for any loss or delay
resulting from any force majeure event, including, without limitation,
acts of God, fire, natural disaster, labor stoppage, war or military
hostilities, civil unrest, or inability of carriers to make scheduled
deliveries, and any affected time period shall be extended to the
extent of any delay resulting from any force majeure event.
(g) The respective rights and obligations of the parties
hereunder shall indefinitely survive the termination of this Agreement
to the extent necessary to the intended preservation of such rights
and obligations or survival of only specific provisions (e.g.,
reversion of rights on expiration or termination).
(h) The parties agree that this Agreement shall be governed
by and construed and interpreted in accordance with the substantive
laws of the State of Delaware, without giving effect to principles
relating to conflict of laws.
(i) Nothing in this Agreement is intended to require
Intergraph or Unigraphics to violate the proprietary or intellectual
property rights of any third party Person.
(j) Intergraph and Unigraphics each agree to execute and
deliver such further instruments and documents, and take such further
actions, as may be reasonably requested by the other party in order to
evidence more fully the transactions contemplated by this Agreement,
provided that such further instruments and actions shall not, unless
otherwise agreed, require either party to incur any obligation in
addition to the obligations undertaken or assumed elsewhere in this
Agreement or in the Asset Purchase Agreement.
(k) Nothing in this Agreement is intended or shall be
construed to give any Person, other than the parties hereto, any legal
claim or equitable right, remedy, or claim under or with respect to
this Agreement or any provision contained herein. The provisions set
forth in this Agreement are for the sole benefit of Unigraphics and
Intergraph.
(l) Any notices or other communications required or
permitted to be given hereunder shall be given in accordance with
Section 10.6 of the Asset Purchase Agreement, which Section 10.6 is
incorporated by reference herein, as though set forth in full herein.
3.3 Taxes.
Intergraph shall be liable for, and shall indemnify and hold
Unigraphics harmless from and against, all applicable sales and use,
value added, consumption, registration, stamp and similar taxes
imposed upon the license granted hereunder ("Applicable Taxes").
Applicable Taxes shall not include Unigraphics' franchise taxes,
income taxes, and other taxes based on net or gross income.
Intergraph agrees to pay to Unigraphics any Applicable Taxes which
Unigraphics is required to collect and pay over to any taxing
authority or provide Unigraphics with a valid exemption certificate or
other documentary evidence of statutory exemption.
IN WITNESS WHEREOF, Intergraph and Unigraphics have each caused
this Agreement to be signed and delivered by its duly authorized
officer, all as of the date first set forth above.
INTERGRAPH CORPORATION,
a Delaware corporation
By: /s/ John W. Wilhoite
--------------------
John W. Wilhoite, Vice President
UNIGRAPHICS SOLUTIONS INC.,
a Delaware corporation
By: /s/ H. Timothy Hatfield
-----------------------
H. Timothy Hatfield, Vice President
Exhibit 1
to Trademark License Agreement
LIST OF TRADEMARKS
The following Trademarks have been granted, or are in the process
of being granted, by the United States Patent and Trademarks Office:
REGISTRATION DATE OF
NUMBER REGISTRATION
TRADEMARKS (Serial Number) (or Registration App.)
- ---------- --------------- ----------------------
SOLID EDGE Serial Number 74/721,439 August 26, 1997
SOLID EDGE
EXCHANGE Serial Number 74/131,517 August 19, 1997
EMS POWERPAK Reg. No. 1,846,558 July 26, 1994
The following Trademarks are owned at common law:
TRADEMARKS
SOLID EDGE and Design (Solid Edge)
PathFinder (Solid Edge)
SmartStep (Solid Edge)
PinPoint (Solid Edge)
PickQuick (Solid Edge)
EMS (EMS)
Engineering Modelling System (EMS)
I/Burn (EMS)
I/CMM (EMS)
I/DESIGN (EMS)
I/DESIGN PROTEGE (EMS)
I/DRAFT (EMS)
I/FEM (EMS)
I/FOLD (EMS)
IMAXMILL (EMS)
I/MDS (EMS)
I/MILL (EMS)
I/MSM (EMS)
I/NC (EMS)
I/NEST (EMS)
IPDM (EMS)
I/PDU (EMS)
I/Prototype (EMS)
I/Punch (EMS)
LICENSE AGREEMENT
("Solid Edge Common Code")
THIS AGREEMENT (this "Agreement"), dated as of March 2,
1998 (the "Effective Date") by and between Intergraph
Corporation, a Delaware corporation having its principal
place of business of One Madison Industrial Park,
Huntsville, Alabama 35894 ("Intergraph") and Unigraphics
Solutions Inc., a Delaware corporation having its principal
place of business at 13736 Riverport Drive, Maryland
Heights, Missouri 63043 ("Unigraphics").
W I T N E S S E T H :
WHEREAS, contemporaneously herewith, Intergraph and
Unigraphics and certain of their respective affiliates have
executed and delivered that certain Asset Purchase Agreement
dated March 2, 1998 (the "Asset Purchase Agreement") with
respect to the sale, transfer, or license by Intergraph to
Unigraphics of certain assets, including assets relating to
the Intergraph Solid Edge Business (as defined herein),
including, without limitation, the Intergraph Solid Edge
software;
WHEREAS, Intergraph and Unigraphics recognize and agree
that some of the Intergraph Solid Edge software and the
Intergraph Solid Edge products have as their constituent
parts certain object-oriented computer software which
Intergraph has developed which is an important constituent
part of substantially all other object-oriented computer
software presently developed, used, and sold by Intergraph,
and which is of material and substantial economic importance
to Intergraph and to Intergraph's continuing ability to
develop, modify, sell, market, and distribute three
dimensional object-oriented computer software other than the
Intergraph Solid Edge software, and which Intergraph does
not intend to sell, convey, assign, or transfer, but which
Intergraph intends to license Unigraphics to use pursuant to
the terms and conditions of this Agreement and the Asset
Purchase Agreement and in which Intergraph intends to
reserve and retain rights; such object-oriented computer
software being defined in Section 1 hereof (collectively,
the "Licensed Property");
WHEREAS, Intergraph desires to grant to Unigraphics and
Unigraphics desires to receive from Intergraph a license
with respect to the Licensed Property, in all events solely
and exclusively upon the terms and conditions set forth
herein; and
WHEREAS, Intergraph desires to retain and reserve
ownership of and other rights in the Licensed Property and
Unigraphics desires to agree to such retention and
reservation of rights in the Licensed Property by
Intergraph, in all events solely and exclusively upon the
terms and conditions set forth herein;
NOW, THEREFORE, in consideration of the mutual
promises, covenants, and agreements set forth herein and
other good and valuable consideration, including, without
limitation the execution and delivery of the Asset Purchase
Agreement, the receipt and adequacy of which is hereby
acknowledged, Intergraph and Unigraphics, intending to be
legally bound, hereby agree as follows:
Section 1. Definitions.
Capitalized terms used in this Agreement shall have the
meanings provided in the Asset Purchase Agreement, except
the capitalized terms listed below which shall have the
following meanings:
(a) Adaptation shall mean any work incorporating any
Solid Edge Common Code (whether directly or indirectly),
including, without limitation, any modified, altered, or
amended version of the Solid Edge Common Code (but not any
modification, alteration, or amendment of the Solid Edge
Common Code which, under applicable law, constitutes a
derivative work), or any work utilizing a method or concept
from the Solid Edge Common Code.
(b) Confidential Information shall mean any data,
source code, trade secrets, documentation, notes, or
information (oral or written) heretofore created, developed,
controlled, possessed, or obtained by Intergraph or
exchanged between the parties, and treated as confidential
and so identified, that concerns the Solid Edge Common Code
or relates in any manner to technical or business aspects of
the Solid Edge Common Code as used or exists in the
Intergraph Solid Edge Business. Notwithstanding the
foregoing, Confidential Information will not be deemed to
include information that is (i) publicly available or in the
public domain at the time disclosed, (ii) or becomes
publicly available or enters the public domain through no
fault of the party receiving such information,
(iii) rightfully communicated to the recipient by persons
not bound by confidentiality obligations with respect
thereto, (iv) already in the recipient's possession free of
any confidentiality obligations with respect thereto at the
time of disclosure, (v) approved by the disclosing party for
release or disclosure without restriction.
(c) Copyright(s) shall mean all copyright interests
owned or claimed by Intergraph in the Solid Edge Common Code
and Documentation, including, without limitation, all common-
law rights.
(d) Development Environment shall mean any
programming, documentation, assemblers, compilers, and media
used by Intergraph for the development, maintenance, testing
and implementation of the Solid Edge Common Code, solely and
exclusively to the extent such objects may be practically
required by Unigraphics for any subsequent maintenance,
testing or enhancement of the Solid Edge Common Code
pursuant to this Agreement, or the comprehension by a
skilled technician of the operation of the Solid Edge Common
Code in the context of the Intergraph Solid Edge Business;
provided, however, that "Development Environment" shall not
include the BAG Products or the INGR Tools (as the BAG
Products and the INGR Tools are defined, respectively, in
that certain BAG Products License Agreement and in that
certain INGR Tools License Agreement (as each such Agreement
is defined in the Asset Purchase Agreement)), or the LTS
Tools.
(e) Documentation shall mean all written materials
(including, design documentation, user documentation, and
program documentation) created by Intergraph, as of the
Effective Date, which directly relate to the use,
distribution, and/or maintenance of the Solid Edge Common
Code.
(f) Intergraph Fields shall mean the following
specific fields:
(i) three-dimensional products without
significant capability for use as a three-
dimensional mechanical system, for data
capture, design, analysis and management of
infrastructure systems. Intergraph's highway
design, utility distribution system, and
mapping products are examples of such
systems;
(ii) three-dimensional products without
significant capability for use as a three-
dimensional mechanical system, for modeling,
designing (including design of component
parts), analyzing, drawing production, or
operation of any of the following systems
which are utilized in chemical and processing
industry plants, ships, marine vessels, or
off-shore platforms, including, without
limitation, (1) piping, (2) heating,
ventilation and air conditioning (HVAC), (3)
cable routing, (4) structural support systems
for marine vessels, ships, and off-shore
platforms, and (5) process and/or instrument
diagrams. Intergraph's plant design and
shipbuilding products are examples of such
systems; and
(iii) performance of the CAD-2
Agreements.
(g) Intergraph Solid Edge Business shall mean
Intergraph's "Solid Edge" products and line of business, as
such exist on the Effective Date.
(h) Joint Fields shall mean the following specific
fields:
(i) two-dimensional drafting systems
(including those which may have application
to the mechanical drafting market);
(ii) two-dimensional modeling systems
(including those which may have application
to the mechanical drafting market);
(iii) creation, publication, or
distribution of technical manuals;
(iv) electrical CAD, CAM, or CAE systems
(or combinations thereof) without significant
capability for use as a three-dimensional
mechanical system; and
(v) all other CAD, CAM, or CAE systems
(or combinations thereof) outside of the
Unigraphics Fields and the Intergraph Fields.
(i) Licensed Property shall mean the Solid Edge Common
Code, as such exists on the Effective Date and in the form
delivered pursuant to Section 4 hereof, including the
expressions of an organized set of instructions in a natural
or coded language which are contained on physical media of
any nature (e.g., written, electronic, magnetic, optical, or
otherwise) and which may be used with a computer or other
automated data processing equipment device of any nature
which is based on digital technology, to make such computer
or other device operate in a particular manner and for a
particular purpose, as well as any related Documentation for
such set of instructions; and "Licensed Property" shall
include computer programs in source and object code, test
and other significant data libraries, Documentation for such
computer programs and any of the following components which
is contained on a physical media of any nature and which is
used in the design, development, modification, enhancement,
testing, installation, maintenance, diagnosis, or assurance
of the performance of the Solid Edge Common Code
(collectively, the "Miscellaneous Software Components"):
processes, techniques, algorithms, symbologies, interfaces,
calculations, models, narrative descriptions, notes,
specifications, designs, flow charts, parameters or
descriptions, logic flow diagrams, masks, input and output
formats, file layouts, data base formats, test programs,
test or other data, user guidelines, manuals, installation
and operating instructions, diagnostic and maintenance
instructions, source code, object code, and other similar
materials and information; and "Licensed Property" shall
further include all Confidential Information received from
Intergraph, Adaptations, and Copyrights, in all events as
such exists on the Effective Date, owned by Intergraph or in
which Intergraph has any right, title, and interest which
are necessary for the use or execution of the Solid Edge
Common Code or any Miscellaneous Software Components. To
the extent that Intergraph has the authority to do so
without incurring any material obligation (but not
otherwise), the Licensed Property shall include a non-
exclusive, royalty-free license to any part of the
Development Environment for the Licensed Property that is
owned by Intergraph or its Affiliates or is not commercially
available elsewhere, in all events as such exists on the
Effective Date and subject to the other terms and conditions
set forth herein. Notwithstanding anything to the contrary
appearing in this Section 1(i), the Licensed Property shall
not include any Third-Party Software incorporated or
embedded in, or compiled or combined with, the Licensed
Property and/or the Development Environment pursuant to the
Marcomp, D-Cubed or ACIS license agreements described on
Schedule 1(i) hereof, or any Patent Rights, the BAG Products
or the INGR Tools, or the LTS Tools.
(j) Patent Rights shall mean all domestic and foreign
patents (including, without limitation, certificates of
invention and other patent equivalents), provisional
applications, patents issuing therefrom, any division or
continuation, re-issue, extension, revival, or renewal of
any patent or invention.
(k) Product shall mean the products offered,
distributed and/or sold by Unigraphics, from time to time.
(l) Solid Edge Common Code shall mean that portion of
the Solid Edge source code that, on the Effective Date, is
not unique to the Solid Edge portion of the Business and is
used in other product and development activities of
Intergraph. The Solid Edge Common Code CD-ROM delivered to
Unigraphics pursuant to Section 4 hereof provides the
parties' best identification of the Solid Edge Common Code
as of the Effective Date.
(m) Third-Party Software shall mean computer software
or other technology in which any Person, other than the
Selling Entities or any other subsidiaries of Intergraph,
has any right, title, or interest, including any
restrictions or obligations (such as, obligations to obtain
consents or approvals, and restrictions that may be
eliminated only by obtaining such consents or approvals)
applicable to the Licensed Property.
(n) Unigraphics Fields shall mean the following
specific field:
three-dimensional mechanical CAD, CAM,
or CAE systems (or combinations thereof)
without significant capability for use
as a three-dimensional plant, offshore
platform, ship, or submarine design
system. Intergraph's EMS and Solid Edge
products are examples of such systems.
Section 2. Ownership of Licensed Property.
The Licensed Property is the property of and is owned
by Intergraph and title shall remain vested in Intergraph.
Unigraphics acknowledges and agrees that the Licensed
Property is comprised of trade secrets, proprietary
information, and other Confidential Information, whether or
not any portion thereof is or may be copyrightable or
patented, and that Unigraphics will not use, distribute,
copy, perform, amend, alter, modify, exploit, sublicense or
assign the Licensed Property, or permit any such to occur,
except as expressly and specifically permitted in by this
Agreement.
Section 3. License and Retained Rights.
(a) Intergraph hereby grants to Unigraphics (i) an
exclusive, world-wide, royalty-free, transferable (to the
extent permitted by Section 13 hereof) license of the
Licensed Property solely within the Unigraphics Fields for
any purpose whatsoever until March 3, 2005; (ii) a non-
exclusive, world-wide, royalty-free, transferable (to the
extent permitted by Section 13 hereof) license of the
Licensed Property solely within the Joint Fields for any
purpose whatsoever until March 3, 2005; and (iii) on and
after March 3, 2005, a perpetual, non-exclusive, world-wide,
royalty-free, transferable (to the extent permitted by
Section 13 hereof) right and license of the Licensed
Property for any purpose whatsoever, whether or not within
the Unigraphics Fields, the Intergraph Fields, or the Joint
Fields (collectively, the "License"); provided, however, and
notwithstanding the foregoing, Intergraph and Unigraphics
expressly agree that Intergraph shall have the right to
continue to perform the CAD-II Agreements (as defined in the
Asset Purchase Agreement) by selling, maintaining, and
supporting products which may include or incorporate the
Solid Edge Common Code and that Intergraph's performance of
the CAD-2 Contract shall not be deemed or construed to be a
violation of this Agreement or the Asset Purchase Agreement
or to otherwise diminish or restrict the exclusive rights in
the Solid Edge Common Code granted to Unigraphics hereunder.
Unigraphics hereby accepts the License and agrees that it
and its successors, assigns, and sublicensees also shall not
have any license to the Licensed Property in the Intergraph
Fields until March 3, 2005, as set forth in Section 3(a)(i)
hereof.
(b) Nothing contained in this Agreement shall be
construed as conferring by implication, estoppel, or
otherwise any license or right under any confidential
information, patent, copyright, trade secret, or other
intellectual property, which is not expressly granted
hereunder.
(c) Neither the execution of this Agreement, the
granting of the License, nor Unigraphics' use or
exploitation of the Licensed Property shall be construed as
an obligation of Intergraph to furnish any Person
(including, without limitation, Unigraphics) any assistance
of any kind whatsoever, or any enhancements, Adaptations,
improvements, modifications, corrections, documentation,
support, training, installation, or maintenance with respect
to the Licensed Property or any portion thereof or any
information or documentation, other than as expressly
provided herein.
(d) To the extent that Unigraphics, at its expense,
creates any derivative work using or incorporating the
Licensed Property by customizing, enhancing, modifying, or
altering any or all portions of the Licensed Property,
notwithstanding Section 2 hereof, the portions of each such
derivative work which do not constitute the Licensed
Property shall be the property of and shall be owned by
Unigraphics and title to each such derivative work shall be
considered separate and independent derivative works with
respect to which Unigraphics shall retain all right, title,
and interest, including, without limitation, the right to
seek separate copyright registration for such derivative
work in accordance with applicable law; provided, however,
that such copyright registration shall identify the Licensed
Property as copyrightable subject matter from which the
derivative work was derived. Unigraphics shall have no
obligation to provide information concerning, make
available, or grant any right in any such derivative work to
Intergraph. All derivative works based on the Licensed
Property and created by Unigraphics shall be subject to the
field of use restrictions described in Section 3(a) hereof.
(e) Intergraph and Unigraphics, each, agree that it
will not assume any obligation or restriction or undertake
any action which is inconsistent with this Agreement.
(f) Notwithstanding any other provision of this
Agreement to the contrary, nothing herein shall be construed
to create a partnership or joint venture between the
parties, to authorize either party to act as agent for the
other, to permit either party to undertake any agreement for
the other, or to use the name or identifying mark or marks
of the other, all except as expressly provided herein or in
other agreements between or among the parties.
Section 4. Delivery; Information Exchange.
At the Principal Closing, Intergraph shall deliver to
Unigraphics a master copy of the Solid Edge Common Code
source code in the form of a CD-ROM containing all
directories for the Solid Edge Common Code, together with
their files, folders, data, information, and source code for
the Solid Edge Common Code, Documentation, any other
relevant documentation or media that evidences or supports
the Solid Edge Common Code source code, and all other
tangible property comprising Licensed Property in all events
as such exists on the Effective Date, such documentation
and media shall include, to the extent the same exists,
system documentation, statements of principles of operation,
and schematics for the Solid Edge Common Code, as well as
any pertinent commentary or explanation that may be
necessary to render the Licensed Property understandable and
usable by a trained computer programmer.
Section 5. Term.
This Agreement shall become effective on the Effective
Date and, except as expressly provided herein, shall remain
in force in perpetuity (or for the longest period otherwise
permitted by law), unless earlier terminated or expires in
accordance with this Agreement.
Section 6. Indemnification and Protection of Licensed
Property; Disclaimer of Certain Warranties.
(a) The indemnification provisions set forth in
Article IX of the Asset Purchase Agreement are incorporated
by reference herein as though set forth in full herein, to
the extent such indemnification provisions apply to the
Licensed Property or to this Agreement.
(b) INTERGRAPH HEREBY DISCLAIMS ALL EXPRESS OR IMPLIED
WARRANTIES WHETHER ARISING BY USAGE OF TRADE OR COURSE OF
DEALING, INCLUDING, WITHOUT LIMITATION, THE WARRANTIES OF
MERCHANTABILITY AND FITNESS FOR A PARTICULAR PURPOSE.
UNIGRAPHICS ACKNOWLEDGES AND AGREES THAT (i) PRIOR TO
THE EFFECTIVE DATE THE SOFTWARE INCLUDED IN THE LICENSED
PROPERTY HAS BEEN AVAILABLE TO AND USED BY THE EMPLOYEES OF
THE MECHANICAL GROUP OF INTERGRAPH AND IS, ON THE EFFECTIVE
DATE, INSTALLED ON EQUIPMENT USED BY SUCH EMPLOYEES WHICH
EQUIPMENT UNIGRAPHICS HAS PURCHASED AND TO WHICH EMPLOYEES
UNIGRAPHICS HAS OFFERED EMPLOYMENT CONTEMPORANEOUSLY
HEREWITH OR ARE OTHERWISE AVAILABLE TO UNIGRAPHICS, (ii)
UNIGRAPHICS IS ACCEPTING THE LICENSED PROPERTY "AS IS, WHERE
IS," (iii) UNIGRAPHICS HAS HAD REASONABLE OPPORTUNITY TO
TEST THE SOLID EDGE COMMON CODE IN A MANNER AND WITH SUCH
METHODS AS UNIGRAPHICS HAS DEEMED NECESSARY, AND (iv) BY
EXECUTING THIS AGREEMENT, UNIGRAPHICS ACCEPTS THE SOLID EDGE
COMMON CODE AND OTHER LICENSED PROPERTY AS CONFORMING TO
UNIGRAPHICS NEEDS AND REQUIREMENTS.
NOTWITHSTANDING THE FOREGOING, THE REPRESENTATIONS AND
WARRANTIES SET FORTH IN THE ASSET PURCHASE AGREEMENT SHALL
NOT BE DIMINISHED OR CHANGED IN ANY WAY HEREBY.
Section 7. Export Requirements.
With respect to the export by Unigraphics of any
Product or of the Licensed Property, the disclosure of the
Licensed Property to a foreign national or any other
activities relating to the Licensed Property, Unigraphics
agrees that it shall obtain any and all necessary or
appropriate export licenses, permits, or other
authorizations and shall otherwise comply with all statutes,
regulations, or other requirements of any governmental
agency. Intergraph agrees to cooperate in good faith with
Unigraphics in this process.
Section 8. Proprietary Markings.
Unigraphics shall not knowingly remove or alter any
proprietary or confidentiality markings (collectively, the
"Proprietary Rights Notices") placed by Intergraph on any of
the master copies of the Licensed Property or any master
copies of Documentation received from or on behalf of
Intergraph. Each copy of the Licensed Property shall
contain any and all Proprietary Rights Notices or other
notices giving credit to Intergraph and/or any other third
party which appears on or in the Licensed Property or is
otherwise required by applicable law.
Section 9. Taxes.
The provisions of Section 10.13 of the Asset Purchase
Agreement relating to tax representations and warranties and
tax matters, respectively, and all defined terms utilized
therein, are incorporated by reference herein. For purposes
of this Agreement, (a) each reference to Acquired Assets set
forth in Section 10.13 of the Asset Purchase Agreement shall
also be deemed to include a reference to the Solid Edge
Common Code, and (b) each reference to Alabama Sales and Use
Taxes, the three percent (3%) Italian registration tax,
Other Transaction Taxes, and Transaction Taxes in Section
10.13 of the Asset Purchase Agreement shall be deemed to
include all such Transaction Taxes arising out of the grant
of the license with respect to the Solid Edge Common Code
pursuant to this Agreement.
Section 10. Trademark License
No identifying mark (including, without limitation,
trade names, trademarks, trade devices, service marks or
symbols, abbreviations, contractions, or simulations
thereof) owned by or used to identify any product or service
of Intergraph or any affiliate or subsidiary of Intergraph
is expressly or by implication licensed hereby. The
respective rights as between Intergraph and Unigraphics
regarding the use of any identifying mark (including,
without limitation, trade names, trademarks, trade devices,
service marks or symbols, abbreviations, contractions, or
simulations thereof) owned by or used to identify any
product or service of Intergraph are set forth in that
certain Trademark License Agreement entered into between
Intergraph and Unigraphics of even date herewith.
Section 11. Confidentiality.
(a) Unigraphics agrees to use the same means as it
uses to protect its confidential information, but in no
event less than reasonable means, to protect the
confidentiality of the Confidential Information, and
Unigraphics shall not disclose any or all of the
Confidential Information (including, without limitation,
source code, methods or concepts utilized therein) to
anyone, except to employees of Unigraphics, assignees,
sublicensees and/or other third parties to whom such
disclosure is necessary or appropriate and whom Unigraphics
has notified that such disclosure is made and shall be kept
confidential consistent with such reasonable means. If
information relating to the Confidential Information at any
time becomes available without restriction to the general
public by acts not attributable to the Unigraphics
employees, assignees, sublicensees, and/or other third
parties to whom disclosure of such information was made,
Unigraphics' obligations under this Section shall not
continue to apply to such information after such time.
(b) The obligations of Unigraphics under this Section
shall survive and continue after any termination of rights
under this Agreement.
Section 12. Termination.
This Agreement may be terminated at anytime by an
express written agreement executed by both parties.
Section 13. Assignability.
The rights and obligations of Unigraphics and
Intergraph under this Agreement may be transferred (either
by operation of law or otherwise), assigned or sublicensed
only as follows:
(a) Intergraph or Unigraphics may grant to one or more
lenders a pledge, security interest, mortgage, lien,
conditional assignment or other similar interest in its
respective rights under this Agreement in connection with
any financing transaction undertaken in the ordinary course
of such party's business; provided, however, that any
lender, or transferee, assignee, or sublicensee of such
lender following foreclosure or realization on the
collateral by any such lender, shall meet the requirements
of Section 13(b) hereof; or
(b) Intergraph or Unigraphics may transfer, assign or
sublicense all or a part of its rights and obligations under
this Agreement to any person or entity that agrees in
writing to be bound by all terms, conditions and
restrictions substantially equivalent to those contained in
this Agreement; provided, however, that any such transfer,
assignment of sublicense shall not relieve either
Unigraphics or Intergraph of their respective obligations
and responsibilities under this Agreement.
Section 14. Arbitration.
In the event of any dispute or claim arising under or
in connection with this Agreement which the parties are
unable to resolve through informal discussions or
negotiation, the parties agree to submit such dispute or
claim to arbitration in accordance with the procedures set
forth in the Asset Purchase Agreement.
Section 15. General Provisions.
(a) This Agreement sets forth the entire agreement and
understanding between the parties as to the subject matter
hereof and merges all prior discussions between them, and
neither of the parties shall be bound by any conditions,
definitions, warranties, understandings, or representations
with respect to such subject matter other than as expressly
provided herein or as set forth in that certain Asset
Purchase Agreement or as set forth on or after the date
hereof in a writing signed by a duly authorized
representative of each party intending to be bound thereby.
(b) The headings found in this Agreement are for
reference purposes only and are to be given no effect in the
construction of this Agreement.
(c) This Agreement may be executed in one or more
counterparts, each of which shall be an original, but all of
which shall, together, constitute one and the same
instrument.
(d) If any provision of this Agreement or the
application of any such provision to any Person or
circumstance, shall be declared judicially to be invalid,
unenforceable or void, such decision shall not have the
effect of invalidating or voiding the remainder of this
Agreement, it being the intent and agreement of the parties
that this Agreement shall be deemed amended by modifying
such provision to the extent necessary to render it valid,
legal and enforceable while preserving its intent or, if
such modification is not possible, by substituting therefor
another provision that is legal and enforceable and that
achieves the same objective.
(e) The observance of any term of this Agreement may
be waived (either generally or in a particular instances and
either retroactively or prospectively) by the party entitled
to enforce such term, but such waiver shall be effective
only if it is in writing signed by the party against which
such waiver is to be asserted. Unless otherwise expressly
provided in this Agreement, no delay or omission on the part
of any party in exercising any right or privilege under this
Agreement shall operate as a waiver thereof, nor shall any
waiver on the part of any party of any right or privilege
under this Agreement operate as a waiver of any other right
or privilege under this Agreement nor shall any single or
partial exercise of any right or privilege preclude any
other or further exercise thereof or the exercise of any
other right or privilege under this Agreement.
(f) Neither party shall be liable for any loss or
delay resulting from any force majeure event, including,
without limitation, acts of God, fire, natural disaster,
labor stoppage, war or military hostilities, civil unrest,
or inability of carriers to make scheduled deliveries, and
any affected time period shall be extended to the extent of
any delay resulting from any force majeure event.
(g) The respective rights and obligations of the
parties hereunder shall indefinitely survive the termination
of this Agreement to the extent necessary to the intended
preservation of such rights and obligations or survival of
only specific provisions (e.g., confidentiality).
(h) The parties agree that this Agreement shall be
governed by and construed and interpreted in accordance with
the substantive laws of the State of Delaware, without
giving effect to principles relating to conflict of laws.
(i) Nothing in this Agreement is intended to require
Intergraph or Unigraphics to violate the proprietary or
intellectual property rights of any third party Person.
(j) Intergraph and Unigraphics each agree to execute
and deliver such further instruments and documents, and take
such further actions, as may be reasonably requested by the
other party in order to evidence more fully the transactions
contemplated by this Agreement, provided that such further
instruments and actions shall not, unless otherwise agreed,
require either party to incur any obligation in addition to
the obligations undertaken or assumed elsewhere in this
Agreement or in the Asset Purchase Agreement.
(k) Nothing in this Agreement is intended or shall be
construed to give any Person, other than the parties hereto,
any legal claim or equitable right, remedy, or claim under
or with respect to this Agreement or any provision contained
herein. The provisions set forth in this Agreement are for
the sole benefit of Unigraphics and Intergraph.
(l) Any notices or other communications required or
permitted to be given hereunder shall be given in accordance
with Section 10.6 of the Asset Purchase Agreement, which
Section 10.6 is incorporated by reference herein, as though
set forth in full herein.
IN WITNESS WHEREOF, the parties hereto have caused this
License Agreement to be executed by their respective
authorized representatives as of the date first above
written.
INTERGRAPH CORPORATION,
a Delaware corporation
By: /s/ John W. Wilhoite
--------------------
John W. Wilhoite, Vice President
UNIGRAPHICS SOLUTIONS INC.,
a Delaware corporation
By: /s/ H. Timothy Hatfield
-----------------------
H. Timothy Hatfield, Vice President
LICENSE AGREEMENT
("BAG Products")
THIS AGREEMENT (this "Agreement"), dated as of March 2,
1998 (the "Effective Date"), by and between Intergraph
Corporation, a Delaware corporation having its principal
place of business at One Madison Industrial Park,
Huntsville, Alabama 35894 ("Intergraph") and Unigraphics
Solutions Inc., a Delaware corporation having its principal
place of business at 13736 Riverport Drive, Maryland
Heights, Missouri 63043 ("Unigraphics").
W I T N E S S E T H :
WHEREAS, contemporaneously herewith, Intergraph and
Unigraphics and certain of their respective affiliates have
executed and delivered that certain Asset Purchase Agreement
dated March 2, 1998 (the "Asset Purchase Agreement") with
respect to the sale, transfer, or license by Intergraph to
Unigraphics of certain assets including assets that may be
used in connection with the Intergraph Basic Application
Group Products or so-called "BAG Products" (as defined
herein);
WHEREAS, this Agreement is that certain BAG Products
License Agreement as defined in Section 2.4 of the Asset
Purchase Agreement; and
WHEREAS, Intergraph desires to grant to Unigraphics and
Unigraphics desires to receive from Intergraph a license
with respect to the BAG Products, in all events solely and
exclusively upon the terms and conditions set forth herein;
NOW, THEREFORE, in consideration of the mutual
promises, covenants, and agreements set forth herein and
other good and valuable consideration, including, the
receipt and adequacy of which is hereby acknowledged,
Intergraph and Unigraphics, intending to be legally bound,
hereby agree as follows:
Section 1. Definitions.
Capitalized terms used in this Agreement shall have the
meanings provided in the Asset Purchase Agreement, except
the capitalized terms listed below which shall have the
following meanings:
(a) Adaptation shall mean any work incorporating any
BAG Products (whether directly or indirectly), including,
without limitation, any modified, altered, or amended
version of the BAG Products (but not any modification,
alteration, or amendment of the BAG Products which, under
applicable law, constitutes a derivative work), or any work
utilizing a method or concept from the BAG Products.
(b) BAG Products shall mean that certain source code
that, on the Effective Date, are used in other Intergraph
products or development activities and are also used in the
EMS component of the Business. The 16 BAG Products eight
millimeter tapes delivered by Intergraph to Unigraphics
pursuant to Section 4 of this Agreement and the descriptions
on Schedule 1(b) attached hereto and incorporated by
reference herein provide the parties' best identification of
the Bag Products as of the Effective Date.
(c) Confidential Information shall mean any data,
source code, trade secrets, documentation, notes, or
information (oral or written) heretofore created, developed,
controlled, possessed, or obtained by Intergraph or
exchanged between the parties, and treated as confidential
and so identified, that concerns the BAG Products or relates
in any manner to technical or business aspects of the BAG
Products as used or exists in the Intergraph EMS Business.
Notwithstanding the foregoing, Confidential Information will
not be deemed to include information that is (i) publicly
available or in the public domain at the time disclosed,
(ii) or becomes publicly available or enters the public
domain through no fault of the party receiving such
information, (iii) rightfully communicated to the recipient
by persons not bound by confidentiality obligations with
respect thereto, (iv) already in the recipient's possession
free of any confidentiality obligations with respect thereto
at the time of disclosure, (v) approved by the disclosing
party for release or disclosure without restriction.
(d) Copyright(s) shall mean all copyright interests
owned or claimed by Intergraph in the BAG Products,
including, without limitation, all common-law rights.
(e) Development Environment shall mean any
programming, documentation, and media used by Intergraph for
the development, maintenance, testing and implementation of
the BAG Products, solely and exclusively to the extent such
objects may be practically required by Unigraphics for any
subsequent maintenance, testing or enhancement of the BAG
Products pursuant to this Agreement, or the comprehension by
a skilled technician of the operation of the BAG Products in
the context of the Intergraph EMS Business; provided,
however, that "Development Environment" shall not include
the INGR Tools described in that certain INGR Tools License
Agreement (as defined in the Asset Purchase Agreement) or
the LTS tools.
(f) Documentation shall mean all written materials
(including, design documentation, user documentation, and
program documentation) created by Intergraph, as of the
Effective Date, which directly relate to the use,
distribution, and/or maintenance of the BAG Products.
(g) Intergraph EMS Business shall mean Intergraph's
"EMS" products and lines of business, as such exist on the
Effective Date.
(h) Licensed Property shall mean the BAG Products, as
such exists on the Effective Date and in the form delivered
pursuant to Section 4 hereof, including the expressions of
an organized set of instructions in a natural or coded
language which are contained on physical media of any nature
(e.g., written, electronic, magnetic, optical, or otherwise)
and which may be used with a computer or other automated
data processing equipment device of any nature which is
based on digital technology, to make such computer or other
device operate in a particular manner and for a particular
purpose, as well as any related Documentation for such set
of instructions; and "Licensed Property" shall include
computer programs in source and object code, test and other
significant data libraries, Documentation for such computer
programs and any of the following components which is
contained on a physical media of any nature and which is
used in the design, development, modification, enhancement,
testing, installation, maintenance, diagnosis, or assurance
of the performance of the BAG Products (collectively, the
"Miscellaneous Software Components"): processes,
techniques, algorithms, symbologies, interfaces,
calculations, models, narrative descriptions, notes,
specifications, designs, flow charts, parameters or
descriptions, logic flow diagrams, masks, input and output
formats, file layouts, data base formats, test programs,
test or other data, user guidelines, manuals, installation
and operating instructions, diagnostic and maintenance
instructions, source code, object code, and other similar
materials and information; and "Licensed Property" shall
further include all Confidential Information received from
Intergraph, Adaptations, and Copyrights, as such exists on
the Effective Date, which are owned by Intergraph or in
which Intergraph has any right, title, and interest and
which are necessary for the use or execution of the BAG
Products or any Miscellaneous Software Components. To the
extent that Intergraph has the authority to do so without
incurring any material obligation (but not otherwise), the
Licensed Property shall include a non-exclusive, royalty-
free license to any part of the Development Environment for
the BAG Products that is owned by Intergraph or its
Affiliates or is not commercially available elsewhere, in
all events as such exist on the Effective Date and subject
to the other terms and conditions set forth herein.
Notwithstanding anything to the contrary appearing in this
Section 1(h), the Licensed Property shall not include any
Third-Party Software (except the Third-Party Software
incorporated or embedded in, or compiled or combined with,
the BAG Products and set forth on Schedule 1(h) attached
hereto and incorporated by reference herein), or any Patent
Rights, or the INGR Tools or the LTS Tools.
(i) Patent Rights shall mean all domestic and foreign
patents (including, without limitation, certificates of
invention and other patent equivalents), provisional
applications, patents issuing therefrom, any division or
continuation, re-issue, extension, revival, or renewal of
any patent or invention.
(j) Product shall mean the EMS products offered,
distributed, or sold by Unigraphics from time to time.
(k) Third-Party Software shall mean computer software
or other technology in which any Person, other than the
Selling Entities or any other subsidiaries of Intergraph,
has any right, title, or interest, including any
restrictions or obligations (such as, obligations to obtain
consents or approvals, and restrictions that may be
eliminated only by obtaining such consents or approvals)
applicable to the Licensed Property.
Section 2. Ownership of Licensed Property.
The Licensed Property is the property of and is owned
by Intergraph and title shall remain vested in Intergraph.
Unigraphics acknowledges and agrees that the Licensed
Property is comprised of trade secrets, proprietary
information, and other Confidential Information, whether or
not any portion thereof is or may be copyrightable or
patented, and that Unigraphics will not use, distribute,
copy, perform, amend, alter, modify, exploit, sublicense or
assign the Licensed Property, or permit any such to occur,
except as expressly and specifically permitted in by this
Agreement.
Section 3. License and Retained Rights.
(a) Intergraph hereby grants to Unigraphics a non-
exclusive, perpetual, world-wide, royalty-free, transferable
(to the extent permitted by Section 13 hereof) license of
the Licensed Property solely for the purpose of developing,
supporting, maintaining, and selling any Product but only if
and to the extent Unigraphics uses the Licensed Property in
combination with the EMS Code (the "License"). Unigraphics
agrees that no other use is licensed hereunder, including
without limitation, the sale of the Licensed Property in any
manner that is independent of or separate from a Product.
Unigraphics hereby accepts the License and agrees that it
and its successors, assigns, and sublicensees shall not have
any right in the Licensed Property except as expressly
provided herein.
(b) Nothing contained in this Agreement shall be
construed as conferring by implication, estoppel, or
otherwise any license or right under any confidential
information, patent, copyright, trade secret, or other
intellectual property, which is not expressly granted
hereunder.
(c) Intergraph shall have the right to use and exploit
the Licensed Property and the Confidential Information
(without regard to whether such purpose relates to the
Licensed Property), in all events for all purposes and in
any manner whatsoever but only in any fields of use in which
Intergraph is not otherwise prohibited from doing so.
Neither the execution of this Agreement, the granting of the
License, nor Unigraphics' use or exploitation of the
Licensed Property shall be construed as an obligation of
Intergraph to furnish any Person (including, without
limitation, Unigraphics) any assistance of any kind
whatsoever, or any Adaptations, enhancements, improvements,
modifications, corrections, documentation, support,
training, installation, or maintenance with respect to the
Licensed Property or any portion thereof, other than as
expressly provided herein. Nothing herein shall affect any
provision of the Asset Purchase Agreement, and in the event
of a conflict between this Agreement and the Asset Purchase
Agreement, the Asset Purchase Agreement controls.
(d) To the extent that Unigraphics, at its expense,
creates any derivative work using or incorporating the
Licensed Property by customizing, enhancing, modifying, or
altering any or all portions of the Licensed Property,
notwithstanding Section 2 hereof, those portions of each
such derivative work which do not constitute Licensed
Property shall be considered separate and independent
derivative works with respect to which Unigraphics shall
retain all right, title, and interest, including, without
limitation, the right to seek separate copyright
registration for such derivative work in accordance with
applicable law; provided, however, that such copyright
registration shall identify the Licensed Property as
copyrightable subject matter from which the derivative work
was derived. Unigraphics shall have no obligation to
provide information concerning, make available, or grant any
right in any such derivative work to Intergraph. All
derivative works based on the Licensed Property and created
by Unigraphics shall be subject to the restrictions
described in Section 3(a) hereof.
(e) Intergraph and Unigraphics, each, agree that it
will not assume any obligation or restriction or undertake
any action which is inconsistent with this Agreement.
(f) Notwithstanding any other provision of this
Agreement to the contrary, nothing herein shall be construed
to create a partnership or joint venture between the
parties, to authorize either party to act as agent for the
other, to permit either party to undertake any agreement for
the other, or to use the name or identifying mark or marks
of the other, all except as expressly provided herein or in
other agreements between or among the parties.
Section 4. Delivery; Information Exchange.
At the Principal Closing, Intergraph shall deliver to
Unigraphics a master copy of the BAG Products source code in
the form of 16 eight millimeter tapes containing all
directories for the BAG Products, together with their files,
folders, data, information, and source code for the BAG
Products, Documentation and any other relevant documentation
or media that evidences or supports the BAG Products source
code, in all events as such exists on the Effective Date,
such documentation and media shall include, to the extent
the same exists, system documentation, statements of
principles of operation, and schematics for the Licensed
Property, as well as any pertinent commentary or explanation
that may be necessary to render the Licensed Property
understandable and usable by a trained computer programmer.
Section 5. Term.
This Agreement shall become effective on the Effective
Date and, except as expressly provided herein, shall remain
in force in perpetuity (or for the longest period otherwise
permitted by law), unless earlier terminated or expires in
accordance with this Agreement.
Section 6. Indemnification and Protection of Licensed
Property; Disclaimer of Certain Warranties.
(a) The indemnification provisions set forth in
Article IX of the Asset Purchase Agreement are incorporated
by reference herein, as though set forth in full herein, to
the extent such indemnification provisions apply to the
Licensed Property or to this Agreement.
(b) INTERGRAPH HEREBY DISCLAIMS ALL EXPRESS OR IMPLIED
WARRANTIES WHETHER ARISING BY USAGE OF TRADE OR COURSE OF
DEALING, INCLUDING, WITHOUT LIMITATION, THE WARRANTIES OF
MERCHANTABILITY AND FITNESS FOR A PARTICULAR PURPOSE.
UNIGRAPHICS ACKNOWLEDGES AND AGREES THAT PRIOR TO THE
EFFECTIVE DATE THE SOFTWARE INCLUDED INLICENSED PROPERTY HAS
BEEN AVAILABLE TO AND USED BY THE EMPLOYEES OF THE
MECHANICAL GROUP OF INTERGRAPH AND IS, ON THE EFFECTIVE
DATE, INSTALLED ON EQUIPMENT USED BY SUCH EMPLOYEES WHICH
EQUIPMENT UNIGRAPHICS HAS PURCHASED AND TO WHICH EMPLOYEES
UNIGRAPHICS HAS OFFERED EMPLOYMENT CONTEMPORANEOUSLY
HEREWITH OR ARE OTHERWISE AVAILABLE TO UNIGRAPHICS, AND
UNIGRAPHICS IS ACCEPTING THE LICENSED PROPERTY "AS IS, WHERE
IS." UNIGRAPHICS HAS HAD REASONABLE OPPORTUNITY TO TEST THE
BAG PRODUCTS IN A MANNER AND WITH SUCH METHODS AS
UNIGRAPHICS HAS DEEMED NECESSARY AND, BY EXECUTING THIS
AGREEMENT, UNIGRAPHICS ACCEPTS THE BAG PRODUCTS AND OTHER
LICENSED PROPERTY AS CONFORMING TO UNIGRAPHICS NEEDS AND
REQUIREMENTS.
NOTWITHSTANDING THE FOREGOING, THE REPRESENTATIONS AND
WARRANTIES SET FORTH IN THE ASSET PURCHASE AGREEMENT SHALL
NOT BE DIMINISHED OR CHANGED IN ANY WAY HEREBY.
Section 7. Export Requirements.
With respect to the export by Unigraphics of any
Product or of the Licensed Property, the disclosure of the
Licensed Property to a foreign national or any other
activities relating to the Licensed Property, Unigraphics
agrees that it shall obtain any and all necessary or
appropriate export licenses, permits, or other
authorizations and shall otherwise comply with all statutes,
regulations, or other requirements of any governmental
agency. Intergraph agrees to cooperate in good faith with
Unigraphics in this process.
Section 8. Proprietary Markings.
Unigraphics shall not knowingly remove or alter any
proprietary or confidentiality markings (collectively, the
"Proprietary Rights Notices") placed by Intergraph on any of
the master copies of the Licensed Property or any master
copies of Documentation received from or on behalf of
Intergraph. Each master copy of the Licensed Property shall
contain any and all Proprietary Rights Notices or other
notices giving credit to Intergraph and/or any other third
party which appears on or in the Licensed Property or is
otherwise required by applicable law.
Section 9. Taxes.
The provisions of Section 10.13 of the Asset Purchase
Agreement relating to tax representations and warranties and
tax matters, respectively, and all defined terms utilized
therein, are incorporated by reference herein. For purposes
of this Agreement, (a) each reference to Acquired Assets set
forth in Section 10.13 of the Asset Purchase Agreement shall
also be deemed to include a reference to the BAG Products,
and (b) each reference to Alabama Transaction Taxes, Italian
Sales and Use Taxes, the three percent (3%) Italian
registration tax, Other Transaction Taxes, and Transaction
Taxes in Section 10.13 of the Asset Purchase Agreement shall
be deemed to include all such Transaction Taxes arising out
of the grant of the license with respect to the BAG Products
pursuant to this Agreement.
Section 10. Trademark License
No identifying mark (including, without limitation,
trade names, trademarks, trade devices, service marks or
symbols, abbreviations, contractions, or simulations
thereof) owned by or used to identify any product or service
of Intergraph or any affiliate or subsidiary of Intergraph
is expressly or by implication licensed hereby. The
respective rights as between Intergraph and Unigraphics
regarding the use of any identifying mark (including,
without limitation, trade names, trademarks, trade devices,
service marks or symbols, abbreviations, contractions, or
simulations thereof) owned by or used to identify any
product or service of Intergraph are set forth in that
certain Trademark License Agreement entered into between
Intergraph and Unigraphics of even date herewith.
Section 11. Confidentiality.
(a) Unigraphics agrees to use the same means as it
uses to protect its confidential information, but in no
event less than reasonable means, to protect the
confidentiality of the Confidential Information, and
Unigraphics shall not disclose any or all of the
Confidential Information (including, without limitation,
source code, methods or concepts utilized therein) to
anyone, except to employees of Unigraphics, assignees,
sublicensees and/or other third parties to whom such
disclosure is necessary or appropriate and whom Unigraphics
has notified that such disclosure is made and shall be kept
confidential consistent with such reasonable means. If
information relating to the Confidential Information at any
time becomes available without restriction to the general
public by acts not attributable to the Unigraphics
employees, assignees, sublicensees, and/or other third
parties to whom disclosure of such information was made,
Unigraphics' obligations under this Section shall not
continue to apply to such information after such time.
(b) The obligations of Unigraphics under this Section
shall survive and continue after any termination of rights
under this Agreement.
Section 12. Termination.
This Agreement may be terminated at anytime by an
express written agreement executed by both parties.
Section 13. Assignability.
The rights and obligations of Unigraphics and
Intergraph under this Agreement may be transferred (either
by operation of law or otherwise), assigned or sublicensed
only as follows:
(a) Intergraph or Unigraphics may grant to one or more
lenders a pledge, security interest, mortgage, lien,
conditional assignment or other similar interest in its
respective rights under this Agreement in connection with
any financing transaction undertaken in the ordinary course
of such party's business; provided, however, that any
lender, or transferee, assignee, or sublicensee of such
lender following foreclosure or realization on the
collateral by any such lender, shall meet the requirements
of Section 13(b) hereof; or
(b) Intergraph or Unigraphics may transfer, assign or
sublicense all or a part of its rights and obligations under
this Agreement to any person or entity that agrees in
writing to be bound by all terms, conditions and
restrictions substantially equivalent to those contained in
this Agreement; provided, however, that any such transfer,
assignment or sublicense shall not relieve either
Unigraphics or Intergraph of their respective obligations
and responsibilities under this Agreement.
Section 14. Arbitration.
In the event of any dispute or claim arising under or
in connection with this Agreement which the parties are
unable to resolve through informal discussions or
negotiation, the parties agree to submit such dispute or
claim to arbitration in accordance with the procedures set
forth in the Asset Purchase Agreement.
Section 15. General Provisions.
(a) This Agreement sets forth the entire agreement and
understanding between the parties as to the subject matter
hereof and merges all prior discussions between them, and
neither of the parties shall be bound by any conditions,
definitions, warranties, understandings, or representations
with respect to such subject matter other than as expressly
provided herein or as set forth in that certain Asset
Purchase Agreement or as set forth on or after the date
hereof in a writing signed by a duly authorized
representative of each party intending to be bound thereby.
(b) The headings found in this Agreement are for
reference purposes only and are to be given no effect in the
construction of this Agreement.
(c) This Agreement may be executed in one or more
counterparts, each of which shall be an original, but all of
which shall, together, constitute one and the same
instrument.
(d) If any provision of this Agreement or the
application of any such provision to any Person or
circumstance, shall be declared judicially to be invalid,
unenforceable or void, such decision shall not have the
effect of invalidating or voiding the remainder of this
Agreement, it being the intent and agreement of the parties
that this Agreement shall be deemed amended by modifying
such provision to the extent necessary to render it valid,
legal and enforceable while preserving its intent or, if
such modification is not possible, by substituting therefor
another provision that is legal and enforceable and that
achieves the same objective.
(e) The observance of any term of this Agreement may
be waived (either generally or in a particular instances and
either retroactively or prospectively) by the party entitled
to enforce such term, but such waiver shall be effective
only if it is in writing signed by the party against which
such waiver is to be asserted. Unless otherwise expressly
provided in this Agreement, no delay or omission on the part
of any party in exercising any right or privilege under this
Agreement shall operate as a waiver thereof, nor shall any
waiver on the part of any party of any right or privilege
under this Agreement operate as a waiver of any other right
or privilege under this Agreement nor shall any single or
partial exercise of any right or privilege preclude any
other or further exercise thereof or the exercise of any
other right or privilege under this Agreement.
(f) Neither party shall be liable for any loss or
delay resulting from any force majeure event, including,
without limitation, acts of God, fire, natural disaster,
labor stoppage, war or military hostilities, civil unrest,
or inability of carriers to make scheduled deliveries, and
any affected time period shall be extended to the extent of
any delay resulting from any force majeure event.
(g) The respective rights and obligations of the
parties hereunder shall indefinitely survive the termination
of this Agreement to the extent necessary to the intended
preservation of such rights and obligations or survival of
only specific provisions (e.g., confidentiality).
(h) The parties agree that this Agreement shall be
governed by and construed and interpreted in accordance with
the substantive laws of the State of Delaware, without
giving effect to principles relating to conflict of laws.
(i) Nothing in this Agreement is intended to require
Intergraph or Unigraphics to violate the proprietary or
intellectual property rights of any third party Person.
(j) Intergraph and Unigraphics each agree to execute
and deliver such further instruments and documents, and take
such further actions, as may be reasonably requested by the
other party in order to evidence more fully the transactions
contemplated by this Agreement, provided that such further
instruments and actions shall not, unless otherwise agreed,
require either party to incur any obligation in addition to
the obligations undertaken or assumed elsewhere in this
Agreement or in the Asset Purchase Agreement.
(k) Nothing in this Agreement is intended or shall be
construed to give any Person, other than the parties hereto,
any legal claim or equitable right, remedy, or claim under
or with respect to this Agreement or any provision contained
herein. The provisions set forth in this Agreement are for
the sole benefit of Unigraphics and Intergraph.
(l) Any notices or other communications required or
permitted to be given hereunder shall be given in accordance
with Section 10.6 of the Asset Purchase Agreement, which
Section 10.6 is incorporated by reference herein as though
set forth in full herein.
IN WITNESS WHEREOF, the parties hereto have caused this
License Agreement to be executed by their respective
authorized representatives as of the date first above
written.
INTERGRAPH CORPORATION,
a Delaware corporation
By: /s/ John W. Wilhoite
--------------------
John W. Wilhoite, Vice President
UNIGRAPHICS SOLUTIONS INC.,
a Delaware corporation
By: /s/ H. Timothy Hatfield
-----------------------
H. Timothy Hatfield, Vice President
SOFTWARE LICENSE AGREEMENT
(INGR Tools)
1. License
Effective as of March 2, 1998, Intergraph Corporation
("Intergraph") agrees to grant and hereby grants, and
Unigraphics Solutions Inc. ("Unigraphics") agrees to accept
and hereby accepts, a non-exclusive, perpetual, royalty-
free, world-wide, limited license under applicable
copyrights and/or trade secrets to use each computer
software program described on Schedule 1 attached hereto and
incorporated by reference herein, (collectively, the "INGR
Tools") under the following terms and conditions:
2. Term of License
The INGR Tools shall be licensed under this Agreement
effective from the date hereof. This Agreement shall remain
in force in perpetuity (or for the longest period permitted
by law), unless earlier terminated by the express written
agreement of both parties.
3. License Coverage
(a) This Agreement is that certain INGR Tools
License Agreement as described in Section 2.4 of that
certain Asset Purchase Agreement between Unigraphics and
Intergraph dated March 2, 1998 (the "Asset Purchase
Agreement") and Unigraphics' use of the INGR Tools hereunder
shall be subject to the same field of use restrictions
imposed upon Unigraphics' use of the Common Code as set
forth in that certain Solid Edge Common Code License
Agreement between Intergraph and Unigraphics dated March 2,
1998 (the "Common Code License Agreement").
(b) Unigraphics shall have the right to use each
INGR Tool or any portion thereof on one (1) specific local
area network (LAN) for which it is licensed, either locked
on a single computer node (as determined by a specific LAN
address), or concurrently on a number of computer nodes, so
long as the number of concurrent uses does not exceed the
number licensed for the LAN, or on one or more backup
computer nodes; provided, however, Unigraphics may change
the identification of the LAN from time to time. No other
use is licensed.
(c) Unigraphics expressly agrees that the license
is limited to Unigraphics internal use solely for the
purpose of allowing Unigraphics (and its permitted
assignees, transferees, or sublicensees) to build, develop,
test, maintain, and support the EMS Code, the Solid Edge
Specific Code, or the Solid Edge Common Code or future
versions of all of the above as defined in the Asset
Purchase Agreement. No other use is licensed, and
Unigraphics agrees not to copy, distribute, use, or execute
any INGR Tool except for the express purposes described in
this Agreement.
(d) Each INGR Tool program has been delivered to
Unigraphics. Unigraphics is further authorized by Intergraph
to make up to two (2) copies of each INGR Tool program in
machine-readable, object-code form for non-productive back-
up purposes only.
(e) Intergraph shall have no obligation to
provide any support, maintenance, enhancements, up-grades,
additions, modifications, new releases or future versions of
any INGR Tool pursuant to this Agreement; notwithstanding
the foregoing, Unigraphics and Intergraph shall have the
right to enter into separate maintenance, training, or other
support agreements on standard commercial terms from time to
time.
(f) The rights and obligations of Unigraphics
under this Agreement may be transferred (either by operation
of law or otherwise), assigned or sublicensed only as
follows:
(i) Unigraphics may grant to one or more
lenders a pledge, security interest, mortgage, lien,
conditional assignment or other similar interest in its
respective rights under this Agreement in connection with
any financing transaction undertaken in the ordinary course
of such party's business; provided, however, that any lender
or transferee, assignee, or sublicensee of such lender
following foreclosure or realization on the collateral by
any such lender shall meet the requirements of clause (ii)
below; or
(ii) Unigraphics may transfer, assign or
sublicense all or a part of its rights and obligations under
this Agreement to any person or entity that agrees in
writing to be bound by all terms, conditions and
restrictions pertaining to Unigraphics under this Agreement,
provided, however, that any such transfer, assignment or
sublicense shall not relieve Unigraphics of its respective
obligations and responsibilities under this Agreement.
4. Security
(a) Certain INGR Tools may be required to operate
in conjunction with a hardware lock device or in conjunction
with license administration software and a license
authorization key provided by Intergraph or its
representative. In such case, Unigraphics shall take no
steps to avoid or defeat the purpose of any required lock
device or authorization key. Use of any INGR Tools without
a required lock device or authorization key shall be deemed
to be an unlicensed activity under this Agreement.
Intergraph shall provide any lock device or authorization
key required to use any INGR Tool under this Agreement.
(b) Without prior written approval of Intergraph,
Unigraphics agrees that it and its employees will not make
any INGR Tool, or portion thereof, or documentation related
thereto, available to any person other than Unigraphics or
Intergraph employees or other persons authorized to use the
LAN for which the software is licensed or any permitted
assignee, transferee, or sublicensee. Unigraphics will not
copy any INGR Tool or documentation except as necessary for
use under this Agreement. Unigraphics will not decrypt
without authorization, reverse compile, or disassemble any
INGR Tool.
5. Title
Title and ownership of the INGR Tools shall at all
times remain with Intergraph or relevant third parties.
6. Disclaimer of Implied and Other Warranties
THE INDEMNIFICATION PROVISIONS SET FORTH IN ARTICLE IX
OF THE ASSET PURCHASE AGREEMENT ARE INCORPORATED BY
REFERENCE HEREIN AS THOUGH SET FORTH IN FULL HEREIN, TO THE
EXTENT SUCH INDEMNIFICATION PROVISIONS APPLY TO THE INGR
TOOLS OR TO THIS AGREEMENT.
INTERGRAPH HEREBY DISCLAIMS ANY IMPLIED WARRANTIES
INCLUDING THE WARRANTIES OF MERCHANTABILITY AND FITNESS FOR
A PARTICULAR PURPOSE. UNIGRAPHICS ACKNOWLEDGES AND AGREES
THAT PRIOR TO THE DATE OF THIS AGREEMENT THE INGR TOOLS HAVE
BEEN AVAILABLE TO AND USED BY THE EMPLOYEES OF THE
MECHANICAL GROUP OF INTERGRAPH AND ARE, ON THE DATE HEREOF,
INSTALLED ON EQUIPMENT USED BY SUCH EMPLOYEES WHICH
EQUIPMENT UNIGRAPHICS HAS PURCHASED AND TO WHICH EMPLOYEES
UNIGRAPHICS HAS OFFERED EMPLOYMENT CONTEMPORANEOUSLY
HEREWITH OR ARE OTHERWISE AVAILABLE TO UNIGRAPHICS, AND
UNIGRAPHICS IS ACCEPTING THE INGR TOOLS "AS IS, WHERE IS."
UNIGRAPHICS HAS HAD REASONABLE OPPORTUNITY TO TEST THE INGR
TOOLS IN A MANNER AND WITH SUCH METHODS AS UNIGRAPHICS HAS
DEEMED NECESSARY AND, BY EXECUTING THIS AGREEMENT,
UNIGRAPHICS ACCEPTS THE INGR TOOLS AS CONFORMING TO
UNIGRAPHICS' NEEDS AND REQUIREMENTS ON THE DATE HEREOF.
NOTWITHSTANDING THE FOREGOING, THE REPRESENTATIONS AND
WARRANTIES SET FORTH IN THE ASSET PURCHASE AGREEMENT SHALL
NOT BE DIMINISHED OR CHANGED IN ANY WAY HEREBY.
7. Patents and Copyrights
If the INGR Tools become, or are likely to become, in
Intergraph's reasonable determination, the subject of a
claim of infringement of a copyright or patent or
misappropriation of a protected trade secret, Intergraph may
(A) acquire for Unigraphics the right to continue using that
portion of the INGR Tools claimed (or likely to be claimed)
to be infringing; or (B) replace such portion for
Unigraphics with other software for which there exists no
infringement claim and which, in all material respects,
provides the same functions as such portion of the INGR
Tools which is claimed (or likely to be claimed) to be
infringing.
8. Arbitration
In the event of any dispute or claim arising under or
in connection with this Agreement which the parties are
unable to resolve through informal discussions or
negotiation, the parties agree to submit such dispute or
claim to arbitration in accordance with the procedures set
forth in the Asset Purchase Agreement.
9. Export Requirements
With respect to the export by Unigraphics of any
Product or of the INGR Tool, the disclosure of the INGR Tool
to a foreign national or any other activities relating to
the INGR Tool, Unigraphics agrees that it shall obtain any
and all necessary or appropriate export licenses, permits,
or other authorizations and shall otherwise comply with all
statutes, regulations, or other requirements of any
governmental agency. Intergraph agrees to cooperate in good
faith with Unigraphics in this process.
10. Confidentiality and Proprietary Markings
Unigraphics shall not knowingly remove or alter any
proprietary or confidentiality markings (collectively, the
"Proprietary Rights Notices") placed by Intergraph on any of
the master copies of the INGR Tools or any master copies of
Documentation received from or on behalf of Intergraph.
Each copy of the INGR Tools shall contain any and all
Proprietary Rights Notices or other notices giving credit to
Intergraph and/or any other third party which appears on or
in the INGR Tools or is otherwise required by applicable
law.
11. Taxes
The provisions of Section 10.13 of the Asset Purchase
Agreement relating to tax representations and warranties and
tax matters, respectively, and all defined terms utilized
therein, are incorporated by reference herein. For purposes
of this Agreement, (a) each reference to Acquired Assets set
forth in Section 10.13 of the Asset Purchase Agreement shall
also be deemed to include a reference to the INGR Tools, and
(b) each reference to Alabama Transaction Taxes, the Italian
3% Registration Tax, Other Transaction Taxes, and
Transaction Taxes in Section 10.13 of the Asset Purchase
Agreement shall be deemed to include all such Transaction
Taxes arising out of the grant of the license with respect
to the INGR Tools pursuant to this Agreement.
12. Trademark License
(a) No identifying mark (including, without
limitation, trade names, trademarks, trade devices, service
marks or symbols, abbreviations, contractions, or
simulations thereof) is expressly or by implication licensed
hereby. The respective rights as between Intergraph and
Unigraphics regarding the use of any identifying mark
(including, without limitation, trade names, trademarks,
trade devices, service marks or symbols, abbreviations,
contractions, or simulations thereof) owned by or used to
identify any product or service of Intergraph are set forth
in that certain Trademark License entered into between
Intergraph and Unigraphics of even date herewith.
13. General Provisions
(a) This Agreement sets forth the entire agreement and
understanding between the parties as to the subject matter
hereof and merges all prior discussions between them, and
neither of the parties shall be bound by any conditions,
definitions, warranties, understandings, or representations
with respect to such subject matter other than as expressly
provided herein or as set forth in that certain Asset
Purchase Agreement or as set forth on or after the date
hereof in a writing signed by a duly authorized
representative of each party intending to be bound thereby.
(b) The headings found in this Agreement are for
reference purposes only and are to be given no effect in the
construction of this Agreement.
(c) This Agreement may be executed in one or more
counterparts, each of which shall be an original, but all of
which shall, together, constitute one and the same
instrument.
(d) If any provision of this Agreement or the
application of any such provision to any Person or
circumstance, shall be declared judicially to be invalid,
unenforceable or void, such decision shall not have the
effect of invalidating or voiding the remainder of this
Agreement, it being the intent and agreement of the parties
that this Agreement shall be deemed amended by modifying
such provision to the extent necessary to render it valid,
legal and enforceable while preserving its intent or, if
such modification is not possible, by substituting therefor
another provision that is legal and enforceable and that
achieves the same objective.
(e) The observance of any term of this Agreement may
be waived (either generally or in a particular instances and
either retroactively or prospectively) by the party entitled
to enforce such term, but such waiver shall be effective
only if it is in writing signed by the party against which
such waiver is to be asserted. Except as otherwise
expressly provided in this Agreement, no delay or omission
on the part of any party in exercising any right or
privilege under this Agreement shall operate as a waiver
thereof, nor shall any waiver on the part of any party of
any right or privilege under this Agreement operate as a
waiver of any other right or privilege under this Agreement
nor shall any single or partial exercise of any right or
privilege preclude any other or further exercise thereof or
the exercise of any other right or privilege under this
Agreement.
(f) Neither party shall be liable for any loss or
delay resulting from any force majeure event, including,
without limitation, acts of God, fire, natural disaster,
labor stoppage, war or military hostilities, civil unrest,
or inability of carriers to make scheduled deliveries, and
any affected time period shall be extended to the extent of
any delay resulting from any force majeure event.
(g) The respective rights and obligations of the
parties hereunder shall indefinitely survive the termination
of this Agreement to the extent necessary to the intended
preservation of such rights and obligations or survival of
only specific provisions.
(h) The parties agree that this Agreement shall be
governed by and construed and interpreted in accordance with
the substantive laws of the State of Delaware, without
giving effect to principles relating to conflict of laws.
(i) Nothing in this Agreement is intended to require
Intergraph or Unigraphics to violate the proprietary or
intellectual property rights of any third party Person.
(j) Intergraph and Unigraphics each agree to execute
and deliver such further instruments and documents, and take
such further actions, as may be reasonably requested by the
other party in order to evidence more fully the transactions
contemplated by this Agreement, provided that such further
instruments and actions shall not, unless otherwise agreed,
require either party to incur any obligation in addition to
the obligations undertaken or assumed elsewhere in this
Agreement or in the Asset Purchase Agreement.
(k) Nothing in this Agreement is intended or shall be
construed to give any Person, other than the parties hereto,
any legal claim or equitable right, remedy, or claim under
or with respect to this Agreement or any provision contained
herein. The provisions set forth in this Agreement are for
the sole benefit of Unigraphics and Intergraph.
(l) Any notices or other communications required or
permitted to be given hereunder shall be given in accordance
with Section 10.6 of the Asset Purchase Agreement, which
Section 10.6 is incorporated by reference herein as though
set forth in full herein.
INTERGRAPH CORPORATION,
a Delaware corporation
By: /s/ John W. Wilhoite
--------------------
John W. Wilhoite, Vice President
UNIGRAPHICS SOLUTIONS INC.,
a Delaware corporation
By: /s/ H. Timothy Hatfield
-----------------------
H. Timothy Hatfield, Vice President
LEASE AGREEMENT
This Lease Agreement (the "Lease") is effective this the 2nd
day of March, 1998, by and between Intergraph Corporation, with
principal offices located at Huntsville, Alabama 35894
("Landlord") and Unigraphics Solutions Inc., with principal
offices located at 13736 Riverport Drive, Maryland Heights,
Missouri 63043 ("Tenant").
ARTICLE I: BASIC PROVISIONS
1.1 FUNDAMENTAL TERMS: The fundamental terms contained in this
section are to be incorporated in the applicable sections
elsewhere in this Lease. The fundamental terms are:
a. Landlord: Intergraph Corporation, a Delaware corporation
b. Tenant: Unigraphics Solutions Inc., a Delaware
corporation
c. Description of Premises: Building 17D, Intergraph Way, Madison, Alabama.
d. Term: Ten months commencing on March 2, 1998
(the "Commencement Date") and ending on
December 31, 1998 (the "Termination Date")
e. Rental Commencement Date: March 2, 1998
f. Base Rent: $10.00/Sq. Ft.
g. Percentage Rental Factor: N/A
h. In Excess of Gross Receipts N/A
i. Security Deposit: N/A
j. Tax Payment: N/A
k. Insurance Payment: N/A
l. Common Area Maintenance: N/A
m. Use: General Office Usage and For Development,
Marketing, Sales, Inventory and
Shipping of computer software
products
n. Optional Extensions: see Section 3.3
1.2 EXHIBITS: The following exhibits are attached to and made a
part of this Lease.
A. Premises Description
B. Common Area
1.3 DEFINITIONS: As used in this Lease, the following terms
shall have the following meanings:
a. Premises: "Premises" shall mean the leased areas specified
on Exhibit "A" consisting of 37,600 square feet and all
improvements constructed or to be constructed thereon excluding
the roof and exterior walls of the building or buildings.
b. Common Area: The "Common Area" shall mean all parking
areas, service roads, loading facilities, sidewalks or other
areas as shown on Exhibit "B", for use in common by the Tenant
and Landlord, and their respective employees and business
invitees under the terms of this Lease and the other rules and
regulations prescribed from time to time by the Landlord.
c. Lease Month: Except for the partial month at the beginning
and the end of the Term, if any, the term "Lease Month" shall
mean a calendar month.
ARTICLE II: LEASE OF PREMISES
2.1 LEASE OF PREMISES: Landlord hereby leases to Tenant, and
Tenant leases and accepts from Landlord, subject to the terms and
conditions of the Lease, the Premises and Common Area.
ARTICLE III: TERM
3.1 TERM: The term of this Lease shall be for a period of Ten
months commencing on the Commencement Date and terminating on
December 31, 1998, unless sooner terminated (the "Lease Term").
3.2 EARLY ENTRY: Prior to the Commencement Date, Tenant may
enter the Premises, with the prior consent of Landlord, to
install, inspect, and/or install or place fixtures and equipment.
Any work done by Tenant shall be done in a manner as will not
interfere with the Landlord's current use or occupation of the
Premises or Common Area. Landlord shall have no liability or
responsibility for loss of, or any damage to fixtures, equipment
or other property of Tenant so installed or placed on the
Premises prior to the Commencement Date.
3.3 EXTENSION OF LEASE TERM: This Lease may be extended, at the
option of Tenant, in accordance with the following procedure:
(a) Not later than September 30, 1998, Landlord shall notify
Tenant in writing of the monthly Base Rent to become
effective for the one (1) year period commencing January 1,
1999 and ending December 31, 1999 (the "Initial Extension
Period"). Such Base Rent shall be established in the sole
discretion of Landlord, but shall not exceed $12.00 per
square foot. Not later than November 30, 1998, Tenant shall
advise Landlord in writing whether it elects to extend this
Lease at such revised Base Rent. If Tenant is not then in
default hereunder and elects to extend this Lease at such
revised Base Rent, Section 4.1 shall be deemed modified to
reflect such revised Base Rent, and this Lease shall be
extended during the Initial Extension Period. If Tenant
declines or fails to elect to extend this Lease at such
revised Base Rent, this Lease shall terminate on December
31, 1998.
(b) Not later than September 30,1999, Landlord shall notify
Tenant in writing of the monthly Base Rent to become effective
for the one (1) year period commencing January 1, 2000 and ending
December 31, 2000 (the "Second Extension Period"). Such Base
Rent shall be established at the sole discretion of Landlord, but
shall not exceed $13.50 per square foot. Not later than November
30, 1999, Tenant shall advise Landlord in writing whether it
elects to extend this Lease at such revised Base Rent. If the
Tenant is not then in default hereunder and elects to extend this
Lease at such revised Base Rent, Section 4.1 shall be deemed
modified to reflect such revised Base Rent, and this Lease shall
be extended, during the Second Extension Period. If Tenant
declines or fails to elect to extend this Lease at such revised
Base Rent, this Lease shall terminate on December 31, 1999.
ARTICLE IV: RENT AND OTHER TENANT CONTRIBUTIONS
4.1 BASE RENT: Tenant shall pay to Landlord as rent for the
Premises a monthly fee of $31,333.33 ("Base Rent") payable on the
first (1st) day of each calendar month at Landlord's address as
shown in Section 13.6 or at such other place as Landlord may
designate from time to time. Notwithstanding the foregoing, the
Base Rent for the first Lease Month shall be due on or before
March 10, 1998. The Base Rent shall be due without demand and
without reduction, abatement, counterclaim or setoff. Should the
Commencement Date be a date other than the first day of the
month, Tenant shall pay, on the date occupancy commences, rent
for the fractional month on a per diem basis (calculated on the
basis of a thirty (30) day month.)
4.2 RIGHT TO INSPECT: At reasonable times and, except in cases
of emergency, with twenty-four hours prior notice to Tenant, the
Landlord or its designated agent may inspect the Premises for
determining Tenant's compliance with the terms of the Lease.
Said inspection shall be at the expense of Landlord. All records
furnished Landlord shall be confidential except that Landlord may
furnish copies to any mortgagee.
4.3 PAYMENT OF CHARGES: Should Tenant fail to pay within 10
days from the date due, the Base Rent, or any other sum or charge
payable by Tenant under this Lease, Tenant shall pay a late
charge in an amount equal to 5% of the amount due.
ARTICLE V: USE OF PREMISES
5.1 TENANT'S USE: The Premises shall be used and occupied
solely for the purpose set forth in Section 1.1 and for no other
purpose without Landlord's prior written consent, which consent
shall not be unreasonably withheld. Tenant shall comply with all
rules, regulations and laws of any governmental authority with
respect to use and occupancy of the Premises and shall not
violate in any manner any of the rights of the Landlord, or any
other tenants.
5.2 UTILITIES: "Utilities", including but not limited to
electricity, gas, water, and sewage shall be provided by the
Landlord at no additional cost to Tenant. In no event shall
Landlord be liable for any interruption or failure in the supply
of any utilities to the Premises.
5.3 SIGNS: Tenant shall not place on any exterior door, wall or
window of the Premises any sign or advertising matter without
first obtaining Landlord's written consent. Tenant agrees to
maintain such sign or advertising matter as approved by Landlord
in good condition and repair. All signs shall comply with
applicable ordinances or other governmental restrictions and the
determination of such requirements and the prompt compliance
therewith shall be the responsibility of the Tenant.
5.4 OCCUPANCY: Tenant will use the Premises and Common Area in
a single work shift environment. Notwithstanding the foregoing,
Tenant shall have access to the Premises twenty-four (24) hours a
day, seven (7) days a week.
5.5 SECURITY: Landlord shall provide security service for the
Premises and the Common Area according to the same standard of
care that Landlord adheres to in rendering security services for
the balance of Landlord's Huntsville facility. Such security
service will be provided at no additional cost to Tenant.
ARTICLE VI: MAINTENANCE SERVICES AND REPAIRS
6.1 TENANT'S DUTY OF MAINTENANCE AND REPAIR: Except for repair
required of the Landlord in Section 6.3 hereof, Tenant shall keep
and maintain the Premises in a clean, sanitary and safe condition
and in accordance with all required rules and regulations of the
governmental agencies having jurisdiction, and of Landlord, and
Tenant shall comply with, and maintain the Premises in compliance
with all requirements of law, by statute, ordinance or otherwise,
affecting the Premises and the appurtenances thereto. Without
limiting the generality of the foregoing, Tenant shall fully,
completely and timely comply with all Environmental Laws, as
defined in that certain Asset Purchase Agreement dated March 2,
1998, by and among Landlord, Tenant and certain of their
respective subsidiaries (the "Purchase Agreement") regarding the
operation of its business on the Premises and Tenant shall not
generate, handle, treat, store or dispose of Hazardous or Toxic
Substances (as defined in the Purchase Agreement) on, under or
in, or transport Hazardous or Toxic Substances from, the Premises
except in full compliance with applicable Environmental Laws. If
Tenant fails to commence and to complete repairs or other
obligations set forth above, promptly and adequately, Landlord
may, but shall not be required to, make and complete said repairs
or other obligations and Tenant shall promptly pay the cost
thereof as additional rent upon demand by Landlord.
6.2 SURRENDER OF PREMISES: At termination of this Lease the
Tenant agrees to deliver the Premises in the same condition as
the Premises were on the Commencement Date, reasonable wear and
tear excepted. Tenant shall surrender to Landlord all keys for
the Premises at the place then designated for the payment of Base
Rent. During the last thirty (30) days of such term, Tenant
shall remove all trade fixtures, and any other installations,
alterations or improvements, to the extent reasonably required by
Landlord and Tenant shall repair any damage to the Premises
caused by the removal of such items. Tenant's obligation to
observe or perform this covenant shall survive the termination of
the Term. Any items remaining in the Premises on the termination
of this Lease shall be deemed abandoned for all purposes and
shall become the property of Landlord. Landlord may dispose of
such abandoned property without liability of any type or nature.
6.3 LANDLORD'S DUTY TO REPAIR: Landlord shall keep and maintain
the foundation, exterior walls and roof of the building in which
the Premises are located and the structural portions of the
Premises which were installed by Landlord, including but not
limited to doors, door frames, door checks, windows, window
frames and plate glass, plumbing, electrical, sewage, water,
HVAC, security and fire suppression systems, in good repair,
except for any repairs caused in whole or in part by the willful
act or negligent act of Tenant, its agents, employees, invitees,
licensees or contractors. Landlord shall not be required to make
any other improvements or repairs of any kind upon the Premises.
Any repairs required as a result of the willful or negligent act
of Tenant, its agents, employees, invitees, licensees or
contractors as above described, shall be made by Tenant.
6.4 TENANT'S ALTERATIONS: Tenant shall not alter the Premises
or any part thereof, and shall not install any fixtures or
equipment to be used in connection with Tenant's business,
without first obtaining the written approval of Landlord, which
consent shall not be unreasonably withheld.
6.5 MECHANIC'S LIENS: If Tenant makes any repairs or
alterations to the Premises, Tenant shall promptly pay all costs
related thereto. Tenant does not have any right or authority to
place any lien, claim or encumbrance of any kind against the
Premises or Landlord's right and interest therein. Tenant shall
cause all steps as are provided by law for the filing of
statutory bond prior to the initiation of any construction with
respect to the Premises. If a mechanic's or materialmen's lien
is threatened or filed by any contractor or supplier, Tenant will
promptly pay same and take steps immediately to have same
removed. If the lien or claim is not removed or paid within the
ten (10) days from the date of written notice from Landlord,
Landlord may, at its option, pay the amount alleged due or any
portion thereof and the amounts so paid, including attorney's
fees and expenses connected therewith, and interest at 10% per
annum on any sums advanced, shall be deemed to be additional rent
and shall be paid to Landlord immediately upon demand. Tenant
will indemnify and save harmless Landlord from and against all
loss, claims, damages, costs or expenses suffered by Landlord by
reason of any repairs, installations or improvements made by
Tenant.
6.6 ROOF: Tenant will not in any manner cut or drive nails into
or otherwise mutilate the roof of the Premises; Tenant will not
place or affix anything to the roof of the Premises, or the
building in which the Premises is located, without first
obtaining the written consent of Landlord. Tenant will be
responsible for any damage caused to the roof by any act of the
Tenant, its agent, employees, invitees or contractors of any type
or nature.
6.7 JANITORIAL/CLEANING: Landlord, directly or through
independent contractors, shall provide routine cleaning of the
Premises and all refuse and or debris removal at no additional
cost to Tenant.
6.8 LANDLORD SERVICES: During the Lease Term, Landlord shall
use its best efforts to provide to Tenant local and long distance
voice network services on the Premises (the "Defined Services").
Tenant agrees to pay Landlord for the Defined Services, as
additional rent, Landlord's actual cost of providing the Defined
Services plus 5% plus a monthly fee of $3.50 per phone to cover
moves, adds, changes and general maintenance. Such additional
rent shall be due within ten (10) days after Tenant's receipt of
a bill for the Defined Services from Landlord. In addition to
the Defined Services, Landlord shall provide Tenant's employees
access to and the use of Landlord's cafeterias and recreational
facilities on the same terms and conditions as such facilities
are made available to Landlord's employees at no extra charge to
Tenant.
6.9 FAILURE OR INTERRUPTION OF DEFINED SERVICES:
Notwithstanding Section 7.3, the failure by Landlord to any
extent to furnish, or the interruption or termination of, the
Defined Services, in whole or in part, resulting from causes
beyond the reasonable control of Landlord, shall not render
Landlord liable in any respect nor be construed as an eviction
(constructive or otherwise) of Tenant, nor work an abatement of
rent, nor relieve Tenant from the obligation to fulfill any
covenant or agreement of this Lease. In the event of any such
interruption or termination of any of the Defined Services,
Landlord shall use its best efforts to restore said services.
Without limiting any of the foregoing, Landlord specifically
shall not be liable for any loss of computer data or other
consequential or incidental damages resulting from an
interruption or termination of the Defined Services.
ARTICLE VII: INSURANCE
7.1 INDEMNIFICATION BY TENANT: Tenant will indemnify Landlord
for, and hold harmless Landlord from and against (a) all fines,
suits, claims, demands, liabilities, and actions (including costs
and expenses of defending against all such actions) resulting or
alleged to result from any breach, violation or nonperformance of
any covenant or condition hereof by Tenant, and (b) all claims,
demands, actions, damages, losses, costs, liabilities, expenses
and judgments suffered by, recovered from or asserted against
Landlord on account of injury or damage to person or property to
the extent that any such damage or injury may be incident to,
arise out of, or be caused either proximately or remotely, wholly
or in part, by an act, omission, negligence or misconduct on the
part of Tenant, Landlord or any of their respective agents,
servants, employees, patrons, guests, licensees or invitees or of
any other person entering upon the Premises under or with the
express or implied invitation or permission of Tenant or when any
such injury or damage is the result, proximate or remote, of the
violation by Tenant or any of its agents, servants, employees,
patrons, guests, licensees or invitees of any law, ordinance or
regulation, or when any such injury or damage may in any other
way arise from or out of the occupancy or use by Tenant, its
agents, servants, employees, patrons, guests, licensees or
invitees of the Premises, the Common Area or the Landlord's
cafeterias or recreational facilities; provided, however, that
the foregoing indemnity shall not apply to the extent such claims
result from the negligence or willful misconduct of Landlord or
Landlord's officers, agents, employees, customers, licensees or
invitees. Landlord shall not be liable for any damages to or
loss of Tenant's personal property, inventory, fixtures, or
improvements from any cause whatsoever, except the negligence or
willful misconduct of Landlord, its officers, agents, employees,
customers, licensees or invitees, and then only to the extent not
covered by insurance to be obtained by Tenant in accordance with
this Lease.
7.2 NOTICE OF CLAIM OR SUIT: Tenant agrees to promptly notify
Landlord of any claim, action, proceeding or suit instituted or
threatened against the Landlord. In the event Landlord is made a
party to any action arising out of or resulting in any way from
any act or omission of Tenant, Tenant shall provide effective
counsel in such litigation or shall pay, at Landlord's option,
the attorney's fees and costs incurred by Landlord in connection
with said claim.
7.3 INDEMNIFICATION BY LANDLORD: Landlord agrees to indemnify,
protect, defend and hold Tenant harmless from all claims,
demands, costs, expenses, damages and liabilities (including
reasonable costs and expenses of defending against such claims,
demands, costs, expenses, damages and liabilities) resulting from
damage to property, or from injury to or death of persons to the
extent resulting from the negligence or wilful misconduct of
Landlord or Landlord's officers, agents, employees, customers,
licensees or invitees; provided, however, that the foregoing
indemnity shall not apply (i) to the extent Tenant is compensated
for such claims by any insurance policies maintained by Tenant or
Landlord, or (ii) to the extent Tenant would have been
compensated by any insurance policies required to be maintained
by Tenant under this Lease had such policies been so maintained.
7.4 DAMAGES FROM CERTAIN CAUSES: Landlord and Tenant shall not
be liable to the other for any loss or damage to any property, or
injury to or death of any person, occasioned by theft, fire, act
of God or the public enemy, injunction, riot, strike,
insurrection, war, requisition or order of governmental body or
authority, the acts or omissions of their respective independent
contractors or any other cause beyond the control of Landlord or
Tenant.
7.5 TENANT INSURANCE: Tenant agrees to maintain, at its
expense, at all times during the Term (i) fire and extended
coverage insurance for full replacement cost of the Premises and
its contents, the acts or omissions of their respective
independent contractors (ii) general liability insurance naming
Landlord as additional insured in an amount not less than
$500,000 per person and $2,000,000 per accident for injuries or
damages to persons, and not less than $5,000,000 damage or
destruction of property, and (iii) workers compensation insurance
written by insurers licensed to do business in the State of
Alabama. Tenant shall deliver to Landlord certificates of such
insurance, which provides that the insurance policies may not be
canceled or amended in whole or in part, without first giving
Landlord written notice of the intention to cancel or amend at
least ten (10) days in advance.
7.6 FAILURE TO PROCURE INSURANCE: In the event Tenant shall
fail to maintain the required insurance policies in force
continuously during the term, Landlord shall be entitled to
procure the same and Tenant shall immediately reimburse Landlord
for such premium expense.
7.7 INCREASE IN FIRE INSURANCE PREMIUM: Tenant agrees not to
keep upon the Premises any articles or goods which may be
prohibited by the standard form of fire insurance policy. It is
agreed between the parties that in the event the insurance rates
applicable to fire and extended coverage insurance covering the
Premises shall be increased by reason of any use of the Premises
made by the Tenant, then Tenant shall pay to Landlord, upon
demand, the amount of such increase in the premium as shall be
occasioned by said use.
7.8 PROPERTY OF TENANT: Tenant agrees that all property owned
by it in, on or about the Premises shall be at the sole risk and
hazard of the Tenant. Except to the extent caused by the
negligence or willful misconduct of Landlord, Landlord shall not
be liable or responsible for any loss of or damage to Tenant, or
otherwise, whether caused by or resulting from a peril, or from
water, steam, gas, leakage, plumbing, electricity or electrical
apparatus, pipe or apparatus of any kind, the elements or other
similar or dissimilar causes, and whether or not originating in
the Premises or elsewhere. Except to the extent Landlord is
obligated to provide security service under Section 5.5, Tenant
assumes all risk for security of the Premises but not the Common
Area.
ARTICLE VIII: FIRE OR OTHER CASUALTY
8.1 CASUALTY DAMAGE: If the Premises or any part thereof shall
be damaged by fire or other casualty, Tenant shall give prompt
written notice thereof to Landlord. In the event the Landlord
decides in its discretion not to repair or restore the Premises
or in the event any mortgagee of Landlord's should require that
the insurance proceeds payable as a result of a casualty be
applied to the payment of the mortgage debt or in the event of
any material uninsured loss to the Premises, Landlord may, at its
option, terminate this Lease by notifying Tenant in writing of
such termination within thirty (30) days after the date of such
damage. If Landlord does not thus elect to terminate this Lease,
Landlord shall commence and proceed with reasonable diligence to
restore the Premises to substantially the same condition in which
it was immediately prior to the happening of the casualty, except
that Landlord shall not be required to spend for such work an
amount in excess of the insurance proceeds actually received by
Landlord as a result of the casualty. Landlord shall not be
liable for any inconvenience or annoyance to Tenant or injury to
the business of Tenant resulting in any way from such damage or
the repair thereof, except that, Landlord shall allow Tenant an
abatement of rent during the time and to the extent the Premises
are unfit for occupancy.
In the event that Landlord shall determine that restoration
of the Premises: (i) will take longer than sixty (60) days; or
(ii) in the event such restoration is not, in fact, completed
within sixty (60) days, then in any such event either of Landlord
or Tenant shall be entitled to cancel this Lease by written
notice to such effect. In the event of any casualty to the
Premises, which renders the Premises unfit for occupancy, the
rent payable by Tenant hereunder shall, equitably abate from the
date of such casualty until the completion of Landlord's required
restoration or until the date of cancellation of this Lease.
ARTICLE IX: ASSIGNMENT AND SUBLETTING
9.1 TENANT ASSIGNMENT: Tenant shall not assign, sublease,
transfer, pledge, or encumber this Lease or any interest therein
without Landlord's prior written consent. Any attempted
assignment, sublease or other transfer or encumbrance by Tenant
in violation of the terms and covenants of this paragraph shall
be void. Notwithstanding any provision contained in the Lease to
the contrary, Tenant shall have the right, without Landlord's
consent, to assign this Lease or sublet all or any part of the
Premises to any "Affiliate" of Tenant, as defined in the Purchase
Agreement. Prior to any such assignment or sublease, Tenant
shall provide Landlord with a written notice specifying the name
of the assignee or sublessee and also providing Landlord with a
copy of the instrument of assignment or sublease. Landlord shall
have twenty (20) days after receipt of such notice to adopt one
of the following alternatives: (a) to approve the proposed sale
or transfer; or (b) to elect to cancel the Lease by written
notice to the Tenant specifying the date of such cancellation
whereupon the Tenant shall pay rental and other charges to the
date of such cancellation, shall vacate the Premises on the said
date and shall thereafter have no further obligation to Landlord
nor shall Landlord have any further obligation to Tenant.
Consent of Landlord to one assignment, subletting, or granting
shall not constitute a waiver of Landlord's rights with respect
to any other assigning, subletting or granting. In no event
shall Tenant assign the Lease or permit the use of any portion of
the Premises for any use which will conflict with the use rights
of the Landlord in the Premises or Common Areas. Any assigning,
subletting or granting, notwithstanding the consent of the
Landlord, shall not in any manner release the Tenant herein from
its continued liability for the performance of the provisions of
this Lease and any amendments or modifications then or thereafter
a part of this Lease. The acceptance of any rental payments by
Landlord from any alleged assignee shall not constitute approval
of the assignment of this Lease by the Landlord.
9.2 BANKRUPTCY, ETC.: Neither this Lease, nor any interest
therein, nor any estate created hereby, shall pass to any trustee
or receiver in bankruptcy, nor to any other receiver or assignee
for the benefit of creditors or otherwise by operation of law.
In the event of bankruptcy or assignment for the benefit of
creditors, Landlord shall be deemed a secured creditor as to the
next six months' rental to the extent permitted by the applicable
federal or state laws unless the rental is otherwise paid
hereunder. As to any additional loss of rent, Landlord shall be
entitled to file as a general creditor.
ARTICLE X: DEFAULT AND RE-ENTRY
10.1 EVENTS OF DEFAULT BY TENANT: The happening of any one or
more of the following listed events ("Events of Default") shall
constitute a breach of this Lease by Tenant:
(a) The failure of Tenant to pay any rent or any other sums
of money within ten (10) days after receipt of written notice
from Landlord that such rent or other sum of money is due;
provided, however that Landlord shall only be required to notify
Tenant in writing of such failure to pay two (2) times during any
twelve month period, and after the second such written notice
within such twelve (12) month period, it shall be an Event of
Default if Tenant shall fail to pay any rent or any other sums of
money within ten (10) days of the date such amounts are due.
(b) Except for the payment of rent and other sums of money
hereunder, the failure of Tenant, within thirty (30) days after
receipt of written notice from Landlord, to comply with any
provision of this Lease or any other agreement between Landlord
and Tenant, all of which terms, provisions and covenants shall be
deemed material; provided, however, that if the nature of
Tenant's failure is such that it cannot reasonably be cured
within such thirty (30) day period, the time for curing such
failure shall be extended for such period of time as may be
necessary to complete such cure provided Tenant shall proceed
promptly to cure the same and shall prosecute such cure
continuously, in good faith and with due diligence.
(c) If the Tenant shall (i) apply for or consent to the
appointment of a receiver, trustee or liquidator of the Tenant or
of all or a substantial part of its assets, (ii) admit in writing
its inability to pay its debts as they come due, (iii) make a
general assignment for the benefit of creditors, (iv) file a
petition or an answer seeking reorganization or arrangement with
creditors or to take advantage of any insolvency law other than
the Federal Bankruptcy Code, (v) file an answer admitting the
material allegations of a petition filed against the Tenant in
any reorganization or insolvency proceedings, other than a
proceeding commenced pursuant to the Federal Bankruptcy Code, or
if any order, judgment or decree shall be entered by any court of
competent jurisdiction, except for a bankruptcy court or a
federal court sitting as a bankruptcy court, adjudicating the
Tenant insolvent, or approving a petition seeking reorganization
of the Tenant, or appointing a receiver, trustee or liquidator of
the Tenant or of all or a substantial part of its assets.
10.2 LANDLORD'S REMEDIES FOR TENANT DEFAULT: Upon the occurrence
of any Event or Events of Default by Tenant, whether enumerated
in Section 10.1 or not, Landlord shall have the option, at
Landlord's election, to pursue any one or more of the following
remedies:
(a) Landlord may cancel and terminate this Lease and
dispossess Tenant;
(b) Landlord may without terminating or cancelling this
Lease declare the "Present Value" of all amounts and rents due
under this Lease for the remainder of the existing term (or any
applicable extension or renewal thereof) to be immediately due
and payable; and thereupon all rents and other charges due
hereunder to the end of the initial term or any renewal term, if
applicable, shall be accelerated. In the event Landlord elects
to so accelerate, Tenant shall be responsible for paying, as
liquidated damages and not as a penalty, an amount equal to the
present value of the Base Rental and any additional rent provided
in this Lease Agreement for the remainder of the stated term
hereof. For purposes of calculating the "present value" pursuant
to this Section 10.2(b), the Base Rental and any additional rent
for the remainder of the term of this Lease shall be discounted
at a rate equal to eight percent (8%). This payment is an agreed
upon sum in the face of unknown losses to Landlord which cannot
be ascertained with certainty by the parties at the present time,
and as such constitutes agreed upon liquidated damages;
(c) Landlord may elect to enter and repossess the Premises
and relet the Premises for Tenant's account, holding Tenant
liable in damages for all reasonable expenses incurred in any
such reletting and for any difference between the amount of rent
received from such reletting and the amount due and payable under
the terms of this Lease;
(d) Landlord may enter upon the Premises and do whatever
Tenant is obligated to do under the terms of this Lease (and
Tenant shall reimburse Landlord on demand for any reasonable
expenses which Landlord may incur in effecting compliance with
Tenant's obligations under this Lease, and Landlord shall not be
liable for any damages resulting to the Tenant from such action).
10.3 LEGAL REMEDIES: Notwithstanding the provision of this
Lease, it is agreed between the parties that the remedies
provided for herein in the event of default are in addition to
and not in lieu of any other remedies or relief made available to
the Landlord or Tenant under the laws of the State of Alabama,
which latter remedies or relief shall be likewise available in
the event of a breach of any of the terms of this Lease.
10.4 ATTORNEY'S FEES: In the event that Landlord shall be
required to engage legal counsel for the enforcement of any of
the terms of this Lease, whether such employment shall require
institution of suit or other legal services required to secure
compliance on the part of Tenant, Tenant shall be responsible for
and shall promptly pay to Landlord reasonable attorney's fees and
expenses.
ARTICLE XI: COMMON AREA
11.1 CONTROL OF COMMON AREA: All parking areas, driveways,
entrances and exits thereto, sidewalks, ramps, landscaped areas,
exterior stairways, and all other Common Area provided by
Landlord for the common use of Tenant's and Landlord's officers,
agents, employees and customers, shall at all times be subject to
the exclusive control and management of Landlord, and Landlord
shall have the right from time to time, and as often as
desirable, to establish, modify and enforce reasonable rights and
regulations with respect to the use of all the Common Area.
Landlord shall have the exclusive right at any and all times to
close any portion of the Common Area for any purpose including
without limitation making repairs, changes or additions thereto
and may change the size, area or arrangement of the parking
areas, or the lighting thereof within or adjacent to the existing
areas and may enter into agreements with adjacent owners for
cross-easements for parking, ingress or egress. In the event
that the lighting controls for the Common Area shall be located
within the Premises, Landlord shall have the right to enter the
Premises of the Tenant for the purpose of operating, maintaining
and repair of such controls and related wiring.
ARTICLE XII: EMINENT DOMAIN
12.1 SUBSTANTIAL TAKING: If the whole or substantially the whole
of the Premises should be taken for any public or quasi-public
use, by right of eminent domain or otherwise or should be sold in
lieu of condemnation, then this Lease shall terminate as of the
date when physical possession of the Premises is taken by the
condemning authority. If less than the whole or substantially
the whole of the Premises is thus taken or sold such that the
Premises are unusable as a result of a condemnation and Tenant
will be prevented from carrying on its normal business operations
for a period of 60 days or more, either party may terminate this
Lease by providing written notice to the other party. Upon such
termination, the obligations of the parties hereunder, including
the obligation of the Tenant to pay rent, shall cease as of the
day the Premises became unusable as a result of such condemnation
or taking.
If this Lease is not so terminated upon any such partial
taking or sale, the rent payable hereunder shall be diminished by
an equitable amount based on the portion of the Premises taken,
if any, and Landlord shall, to the extent Landlord deems
feasible, restore the Premises to substantially their former
condition, provided, however, Landlord shall not be required to
spend for such work an amount in excess of the amount received by
Landlord as compensation for such damage. All amounts awarded
upon a taking of any part or all of the Premises shall belong to
Landlord, and Tenant shall not be entitled to and expressly
waives all claim to any such compensation, including any award or
ascertainment for the value of Tenant's leasehold estate, which
value in hereby assigned to the Landlord.
12.2 AWARD: Tenant shall not be entitled to participate or
receive any part of the damages or award which may be paid to or
awarded Landlord by reason of a taking under this Article except
where said award shall provide for moving or other reimbursable
expenses for the Tenant under statute, in which event the latter
shall be received by Tenant.
ARTICLE XIII: GENERAL PROVISIONS
13.1 LANDLORD'S RIGHT OF ENTRY: At reasonable times and, except
in cases of emergency and except with respect to the security
service contemplated by Section 5.5, with twenty-four (24) hours
notice to Tenant, Landlord may, as often as desirable, during the
term of this Lease enter the Premises for the purpose of
inspecting and examining the same, and to show the same to
prospective purchasers or tenants, and make such repairs,
alterations, improvements or additions as Landlord may deem
necessary or desirable. Landlord's right to enter shall, in the
event of an emergency, include the right of the Landlord to
forcibly enter said Premises without rendering Landlord or
Landlord's agents or employees liable therefor. During any such
inspection or entry by Landlord, other than those required by
emergency, or in connection with the security service
contemplated by Section 5.5, Tenant shall have the right to
escort and accompany the persons performing the inspection to any
areas of the Premises deemed confidential by Tenant. During the
ninety (90) days prior to the expiration of the term of this
Lease, Landlord may exhibit the Premises to prospective tenants
or purchasers, and place upon the Premises the usual notices
advertising the Premises for sale or lease, as the case may be,
which notices Tenant shall permit to remain thereon without
molestation. Nothing herein contained, however, shall be deemed
or construed to impose upon Landlord any obligation,
responsibility or liability whatsoever for the care, maintenance
or repair of the building or any part thereof, except as
otherwise herein specifically provided.
13.2 QUIET ENJOYMENT: Landlord agrees that, if the rent is being
paid in the manner and at the time prescribed and the covenants
and obligations of Tenant being all and singular kept, fulfilled
and performed, Tenant shall lawfully and peaceably have, hold,
possess, use and occupy and enjoy the Premises so long as this
Lease remains in force, without hindrance, disturbance or
molestation from Landlord, subject to the specific provisions of
this Lease.
13.3 WAIVER: Waiver by Landlord of any default, breach or
failure of Tenant under this Lease shall not be construed as a
waiver of any other existing or future default, breach or
failure. In case of a breach by Tenant of any of the covenants
or undertakings of Tenant, Landlord nevertheless may accept from
Tenant any payment or payments hereunder without in any way
waiving Landlord's right to exercise any right or remedy provided
for by reason of any other existing or future breach.
13.4 TRADE FIXTURES: At the expiration of this Lease, provided
Tenant is not in default, Tenant shall remove any trade fixtures
installed by Tenant on the Premises, and shall repair any damage
to the Premises caused by such removal.
13.5 SUBORDINATION: This Lease is and shall be subject and
subordinate to any mortgage, or other lien created by Landlord,
whether now existing or hereafter arising upon the Premises, or
attorning to the holder of any such liens, as Landlord may
request. Notwithstanding the foregoing, Tenant's obligations
under this Section 13.5 are subject to and conditioned upon any
such lienholder's execution and delivery of a non-disturbance
agreement in a form upon which Landlord, Tenant and mortgagee may
mutually agree.
13.6 NOTICES: All notices by either party to the other shall be
made by depositing such notice in the certified mail of the
United States of America, and such notice shall be deemed to have
been served on the date of such depositing in the Certified Mail
unless otherwise provided. All notices to the Landlord shall be
sent to Landlord at: Intergraph Corporation, Lease
Administration, Mail Stop CR041, Huntsville, AL 35894, or at
such other address as Landlord may from time to time designate in
writing to Tenant, and all notices to Tenant shall be sent to
Tenant at the address set forth in Section 1.1 or at such other
address as Tenant may from time to time designate in writing to
Landlord.
13.7 RECORDING: Neither this Agreement, or any memorandum hereof
shall be recorded, or otherwise made available as a public
document.
13.8 AMENDMENT: No amendment shall be enforceable unless in
writing and signed by the parties. All amendments must be in
writing, executed by the parties or their respective successors
in interest.
13.9 HOLDING OVER: Any holding over after the expiration of the
term with the consent of the Landlord, shall be construed to be a
tenancy from month to month at a rental equal to 150% of the Base
Rent.
13.10 NO PARTNERSHIP: It is understood that Landlord does
not in any way or purpose become a partner or joint venturer with
Tenant in the conduct of Tenant's business.
13.11 PARTIAL INVALIDITY: If any term or condition of this
Lease or the application thereof to any person or event shall to
any extent be invalid and unenforceable, the remainder of this
Lease in the application of such term, covenant or condition to
persons or events other than those to which it is held invalid or
unenforceable shall not be affected and each term, covenant and
condition of this Lease shall be valid and enforced to the
fullest extent permitted by law.
13.12 SUCCESSORS: The provisions, covenants and conditions
of this Lease shall bind and inure to the benefit of the legal
representatives, successors and assigns of each of the parties,
except that no assignment or subletting by Tenant without the
written consent of Landlord shall vest any right in the assignee
or sublessee or Tenant.
13.13 ENTIRE AGREEMENT; MODIFICATION: This Lease supersedes
all prior discussions and contracts between Landlord and Tenant
with respect to the Premises and contains the sole and entire
understanding between Landlord and Tenant with respect to the
Premises. All promises, contracts, commitments, representations
and warranties heretofore made between the parties are merged
into this contract. This contract shall not be modified or
amended in any respect except by a written instrument executed by
or on behalf of each of the parties to this Lease.
13.14 EXHIBITS. Each and every exhibit referred to or
otherwise mentioned in this Lease is attached to this Lease and
is and shall be construed to be made a part of this Lease by such
reference or other mention at each point at which such reference
or other mention occurs, in the same manner and with the same
effect as if each exhibit were set forth in full and at length
every time it is referred to or otherwise mentioned.
13.15 GOVERNING LAW: This Lease is made and shall be
construed under and in accordance with the laws of the State of
Alabama. Jurisdiction and venue shall be in the Circuit Court of
Madison County, Alabama, or the United States District Court for
the Northern District of Alabama, Northern Division.
13.16 COMMISSION: Tenant warrants that there are no claims
for broker's commission or finder's fees in connection with
Tenant's execution of this Lease.
13.17 ENVIRONMENTAL MATTERS: As of the Commencement Date, to
the best knowledge of the Landlord, without independent
investigation, the Premises are currently in compliance with, all
Environmental Laws (as defined in the Purchase Agreement and all
related permits, licenses, orders, approvals, waivers and
variances. Except as set forth in Schedule 3.15 to the Purchase
Agreement, to the best knowledge of the Landlord, without
independent investigation, no Hazardous or Toxic Substances (as
defined in the Purchase Agreement) are, or have been, used,
generated, handled, treated, stored or disposed of on, under or
in, or transported from, the Premises except in full compliance
with applicable Environmental Laws. Except as set forth in
Schedule 3.15 of the Purchase Agreement, the Landlord has never
received any complaint, order, citation or notice, public or
private, with respect to any possible violation of the
Environmental Laws or obligation or liability thereunder related
to the Premises.
13.18 TRANSFERS BY LANDLORD: Landlord shall have the right
to transfer and assign, in whole or in part, all of its rights
and obligations hereunder and in the Premises, and in such event
and upon such transfer, Landlord shall be released from any
further obligations hereunder and Tenant agrees to look solely to
such successor in interest of Landlord for the performance of
such obligations.
THIS LEASE, including Exhibits A and B attached hereto, is
effective the 2nd day of March, 1998.
LANDLORD:
INTERGRAPH CORPORATION
ATTEST:
By: /s/ James W. Meadlock By: /s/ John W. Wilhoite
----------------------- ---------------------
John W. Wilhoite, Vice President
TENANT:
UNIGRAPHICS SOLUTIONS INC.
ATTEST:
By: /s/ David B. Hollander By: /s/ H. Timothy Hatfield
----------------------- ------------------------
H. Timothy Hatfield, Vice President
EXHIBIT A
PREMISES DESCRIPTION
The Premises shall be described as a single story industrial
building consisting of approximately 37,600 square feet. The
floor is poured concrete, walls are concrete block covered by
industrial coating and the roof structure is a flat composite.
Heating and cooling units are located on the Premises.
EXHIBIT B
COMMON AREA DESCRIPTION
(Map of Site Layout, Intergraph Corporation, Huntsville, Alabama)
AGREEMENT FOR ENGINEERING SERVICES
This Agreement for Engineering Services ("Agreement") is
entered this 2nd day of March, 1998, by and between Intergraph
Corporation (hereinafter referred to as "Intergraph"), a Delaware
corporation with its principal business location of One Madison
Industrial Park, Huntsville, Alabama 35894 and Unigraphics
Solutions Inc. (hereinafter referred to as "USI"), a Delaware
corporation with its principal business location of 13736
Riverport Drive, Maryland Heights, Missouri 63043.
WITNESSETH:
WHEREAS, concurrently with the execution of this Agreement,
Intergraph and certain of its affiliates (the "Selling Entities")
are selling and transferring to USI and certain of its affiliates
(the "Acquiring Entities") and USI and certain of the Acquiring
Entities are purchasing and acquiring from Intergraph and certain
of the Selling Entities, the assets comprising the Solid Edge/EMS
business of Intergraph pursuant to the terms of the Asset
Purchase Agreement dated as of March 2, 1998 (the "Purchase
Agreement");
WHEREAS, pursuant to the terms of the Purchase Agreement,
the parties hereto are entering into this Agreement to provide
for the furnishing of certain services to USI following the
applicable Closing (as such term and all other capitalized terms
used but not defined herein are defined in the Purchase
Agreement) under the terms set forth in this Agreement;
WHEREAS, Intergraph has a subsidiary located in India and
organized under Indian law, Intergraph India Pvt. Ltd. ("IIPL"),
which provides certain engineering services for export; and
WHEREAS, USI desires to procure from Intergraph certain
engineering services related to the Solid Edge and EMS product
lines.
NOW, THEREFORE, in consideration of the premises, the
respective covenants, representations and warranties set forth
below, and other good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, and intending to be
legally bound hereby, the parties hereto agree as follows:
ARTICLE I
SERVICES
1.1 Services. Intergraph shall cause IIPL to provide
software development services ("Services") for the Solid Edge and
EMS product lines as the parties hereto mutually agree. USI
shall pay Intergraph for the Services during the term of this
Agreement.
1.2 Location Restriction. The Services provided hereunder
will be restricted to such Services as can be provided by IIPL
employees while physically located within the geographical
borders of the United States of America or India.
1.3 Exception. Any services requested by a USI entity
which would require IIPL employees to be physically located
outside the United States of America or India will be provided
only upon USI satisfying the following conditions prior to
commencement of work:
(a) The person or persons selected by USI to
perform such services shall be seconded to a USI
entity for the duration of such services under a
written secondment agreement substantially in the
form to be agreed upon by the parties as soon as
practicable after the date hereof.
(b) The USI entity shall obtain entry and
exit visas on behalf of the IIPL employee from
local country competent authorities.
1.4 Charges and Expenses. For the performance of Services,
USI shall pay Intergraph at the rates set forth in Schedule A to
this Agreement relating to such Services or as otherwise agreed
upon in writing by the parties ("Charges").
1.5 Project Directors. Carlene Neeley will be project
director for Intergraph and Bill McClure will be the project
director for USI. Both parties shall have the right to select an
alternative project director, and if this occurs, agree to notify
the other party within seven (7) business days.
ARTICLE 2
HUMAN RESOURCES
2.1 Personnel. In order to satisfy its obligations
hereunder and in accordance with the Purchase Agreement,
Intergraph will provide the services equivalent to the efforts of
the forty-two (42) engineering personnel at IIPL listed in
Schedule B hereto (hereinafter referred to as "MCAD Personnel").
The actual head count may vary due to attrition, terminations,
etc. Should any of the MCAD Personnel be terminated or otherwise
leave IIPL during the term of this Agreement and the parties
hereto mutually determine in good faith that a replacement
employee is necessary to maintain the level of service provided
hereunder, then Intergraph will replace said employee.
Intergraph will provide an option for one of the forty-two
persons to be based at USI's Huntsville, Alabama location and
that this person will serve as the technical liaison between IIPL
and USI (the "Technical Liaison"). Costs associated with the
Technical Liaison will be borne by USI in accordance with the
appropriate travel rate provided for in Schedule A. A listing
of the roles and responsibilities for the Technical Liaison will
be subject to mutual agreement prior to exercise of the option.
2.2 Organization. The current Mechanical Computer-Aided
Design ("MCAD") operational unit within IIPL consists of 1
manager, 4 project leaders and 37 software engineers (for
software development & testing). Whereas the total number of
employees in the MCAD operational unit within IIPL is 42, five
(5) of them (Managers and Project Leaders) represent the middle
management. Intergraph shall cause IIPL to use its best efforts
to maintain the appropriate mix between middle management and the
total number of MCAD Personnel.
2.3 Training. Intergraph shall cause IIPL to provide
Visual C++, Visual Basic and communication skills training, if so
required, for the MCAD Personnel at no charge to USI. Any
required refreshment training shall also be provided by IIPL if
the parties mutually agree. Any special training required by USI
is not included in the base rate outlined in Exhibit-A and shall
be paid for by USI, including labor costs.
2.4 Career Rotation. IIPL shall always obtain prior
consent of USI to effect any rotation of personnel within the
MCAD Personnel group or any transfer between MCAD and non-MCAD
projects within IIPL. Similarly, should USI require any rotation
of MCAD Personnel within MCAD projects, this will be done through
mutual consent.
2.5 Non-Solicitation. IIPL and USI shall not directly or
indirectly solicit for employment any employee of the other
without the prior written consent of the other for the duration
of this contract, any extension thereof, and for a period of two
(2) years thereafter.
ARTICLE 3
EQUIPMENT
For the MCAD Personnel, Intergraph will provide office
space, telephone access, workstations and output devices. For
the Intergraph-owned equipment at IIPL, Intergraph will be
responsible for all hardware and software maintenance.
ARTICLE 4
NETWORKING
Intergraph will provide network resources as part of the
base rate specified in Exhibit A. Intergraph agrees that the
level of network bandwidth provided will not drop below 0.75 KBPS
of bandwidth per person. USI will also use this resource for
working with the developers in India.
ARTICLE 5
CALL TRACKING
MCAD Personnel will use two separate call tracking systems
in their work for USI. One system will be the Unigraphics Global
Technical Access system ("GTAC"). USI will supply a machine to
provide the client access for this system in India. The other
system will be the Jupiter Tracking System ("JTS"), which will be
available to the MCAD Personnel via the network link to USI in
Huntsville.
ARTICLE 6
SOFTWARE DEVELOPMENT LIFE CYCLE
MCAD Personnel shall work according to the software
development life cycle mutually agreed to between USI and IIPL.
USI is pursuing ISO Certification while IIPL is working on a
quality improvement program based on the Capability Maturity
Model ("CMM"). Intergraph shall cause IIPL to meet the quality
requirements of USI through an approach which is mutually agreed
to between the two parties (either by seeking certification of
the IIPL MCAD quality improvement program or by implementing the
contract review clause of the ISO).
ARTICLE 7
MANAGEMENT PROCESS
The managers for the IIPL MCAD projects shall work at the
direction of USI Solid Edge Product Business Unit ("PBU")
technical managers regarding day-to-day issues (e.g. status
reports, conference calls, schedules, work definition, delivery,
etc.). Issues related to resources and assets will be handled
between the General Manager of IIPL (currently, Surajit Dutta
Choudhury) and the Solid Edge PBU Leader of USI. Conflict
resolution shall be handled between the Solid Edge PBU Leader,
the General Manager of IIPL and the Intergraph Huntsville India
Oversight Manager.
ARTICLE 8
SUPPORT OF IIPL CORPORATE INITIATIVES
The Solid Edge PBU of USI shall support the quality and
process improvement initiatives of IIPL. Intergraph shall cause
IIPL to inform the Solid Edge PBU of USI of the impacts (on
projects) of such initiatives. Resource allocation for such
initiatives shall be done by mutual consent.
ARTICLE 9
IIPL MCAD ACCOUNTABILITY
9.1 Metrics. Intergraph and USI will mutually establish
metrics for resource requirements, project execution timeline and
quality for the software services shortly after execution of this
Agreement. Intergraph will provide bi-monthly updates on the
mutually agreed metrics.
9.2 Allocations. Any allocation of a new project, changes
in an existing project or closure of a software
development/testing project by USI shall be agreed to by both the
parties and documented in a mutually agreeable format.
9.3 Overtime. Intergraph agrees to a maximum of six (6)
hours per week of non-billable overtime for each member of the
MCAD Personnel. Intergraph and USI shall mutually agree on
higher levels of efforts required as specified in the project
metrics.
9.4 Fixed Price. Intergraph reserves the right to provide
USI with a fixed price for a defined set of services after
mutually agreeing on the delivery metrics.
ARTICLE 10
OWNERSHIP
Pursuant to this Agreement, Intergraph employees will have
access to USI technology. Title and all rights of ownership to
USI technology remain with USI and possibly other parties ("Other
Owners") to whom USI has obligations to protect such title and
ownership rights. By virtue of this Agreement, Intergraph does
not assume any ownership rights to USI technology.
ARTICLE 11
NON-DISCLOSURE
11.1 Proprietary Information. By virtue of this Agreement,
each party may have access to information of the other party
which is considered confidential and proprietary. For
convenience, all such information will be called "Proprietary
Information." Proprietary Information shall include source code
materials, if any, and all other information provided by either
party in written or other tangible form and clearly marked as
proprietary or confidential. Notwithstanding the foregoing,
Proprietary Information shall not include information which a) is
or becomes part of the public domain through no act or omission
of the receiving party; b) was in the receiving party's lawful
possession prior to the disclosure and had not been subject to
limitations on disclosure; c) is lawfully disclosed hereafter to
the receiving party by a third party who did not acquire the
information directly or indirectly from the disclosing party; or
d) is independently developed by the other party.
11.2 Maintenance of Confidentiality. The parties agree,
both during the term of this Agreement and for a period of three
(3) years after termination or expiration of this Agreement, that
all Proprietary Information owned solely by one party and
disclosed to the other party shall remain solely the property of
the disclosing party, and its confidentiality shall be maintained
and protected by the other party with the same effort used to
protect its own confidential information. Except to the extent
required by this Agreement, both parties agree not to duplicate
in any manner the other's Proprietary Information for any purpose
other than the implementation of this Agreement. Nothing in this
Agreement shall be construed to limit either party's right to
independently develop software which is functionally similar to
the other party's products, so long as proprietary information of
the other party is not used in such development. Results of
benchmark, performance, or timing tests involving Intergraph's
hardware and /or software platform and run by USI may not be
disclosed unless Intergraph consents to such disclosure in
writing.
11.3 Disclosure as to Agreement. Intergraph and USI shall
not disclose the terms and conditions of this Agreement; provided
however, that either party may disclose such terms and conditions
(a) when required by law, and (b) to its professional advisors
and financial professionals. For news release or public
announcements regarding this Agreement, each party will obtain
consent from the other party prior to publication. Such consent
shall not be unreasonably withheld.
ARTICLE 12
TERM
This Agreement shall be valid for an initial one (1) year
term. USI may, but shall not be obligated to, establish a legal
entity in India ("Unigraphics-India") and transfer the MCAD
Personnel to that entity at the termination of this Agreement.
In the event USI requests an extension of this Agreement, the
parties agree to enter good faith discussions, but Intergraph is
under no obligations to extend the Agreement. Any agreement
extension shall be based on mutually acceptable terms. Anything
contained herein to the contrary notwithstanding, USI shall
notify Intergraph of its intentions as to whether it will
transition the MCAD Personnel to Unigraphics-India at least
ninety (90) days prior to the conclusion of this Agreement.
ARTICLE 13
TRANSITION TO USI
USI retains the right, upon the termination of this
contract, to transition all IIPL MCAD Personnel, as well as the
hardware and software resources used by the MCAD Personnel in
performing their duties described herein, at no cost to USI,
except for those that are mutually agreed to be excluded. To
this end, Intergraph shall cause IIPL to maintain records of all
resources dedicated to MCAD projects. Anything contained herein
to the contrary notwithstanding, USI will bear (i) any costs
(including, without limitation, any severance costs) related to
the transition of the MCAD Personnel to Unigraphics-India that
result from this transition, and (ii) any costs (including,
without limitation, any severance costs) arising from the
termination of the MCAD Personnel by IIPL in the event USI
determines not to transition the MCAD Personnel to Unigraphics-
India.
ARTICLE 14
OTHER
Distribution of USI software and special software
development tools, intellectual property rights and protection,
conformance to United States export compliance, access to USI
networks and GTAC by Intergraph personnel is covered by the
Purchase Agreement or the Transition Services Agreement between
Intergraph and USI.
ARTICLE 15
TERMINATION
15.1 Mutual Consent. This Agreement may be terminated at
any time by written agreement executed by both parties. USI will
be responsible for any employee termination costs that result
from such a termination.
15.2 Breach. If either party shall be in material breach of
its obligations herein and shall have failed or been unable to
remedy such breach within thirty (30) days after receipt of
written notice from the other party specifying such breach, said
other party may terminate this Agreement by giving written notice
of termination, effective upon the date of its receipt.
15.3 Bankruptcy. If a receiver is appointed over the whole
or part of the assets of either party, or if any petition is
filed by or against either party initiating any bankruptcy
reorganization proceeding or if either party makes an assignment
for the benefit of creditors, or if any order is made or
resolution is adopted for the dissolution of either party (unless
such order or resolution is part of a scheme of recapitalization,
merger or consolidation) then such party shall immediately notify
the other party of such event, and the other party may terminate
this Agreement by written notice thereof, effective upon the date
of its sending.
15.4 Proprietary Information. Upon termination of this
Agreement, at the end of its term, Intergraph shall return to USI
or destroy all Proprietary Information and all copies and
portions thereof, in any form whatsoever, and shall erase from
all computer, electronic, or other storage devices or otherwise
destroy all images or copies thereof.
ARTICLE 16
MISCELLANEOUS
16.1 Notices. All notices, requests and demands given to or
made upon the parties hereto shall, except as otherwise specified
herein, be given or made in accordance with Section 10.6 of the
Purchase Agreement.
16.2 Headings. The various headings in this Agreement are
inserted for convenience only and shall not affect the meaning or
interpretation of this Agreement or any paragraph or provision
hereof. References in this Agreement to any paragraph are to the
applicable paragraph of this Agreement.
16.3 Assignment. All covenants, stipulations and promises
in this Agreement shall be binding upon and inure to the benefit
of the parties hereto and their respective successors, and legal
representatives. Neither party shall have the right to assign or
otherwise transfer this Agreement or any rights or obligations
hereunder without the express written consent of the other
provided, however, that a successor in interest by merger,
consolidation, operation of law, assignment, purchase, or
otherwise, of the entire business of either party, shall acquire
all interests of such party hereunder without the written consent
of the other.
16.4 Amendments; Waiver. This Agreement cannot be, and
shall not be deemed or construed to have been, modified, amended,
rescinded, canceled or waived, in whole or in part, except by a
written instrument signed by the parties hereto.
16.5 Governing Law. Notwithstanding the place where this
Services Agreement may be executed by any of the parties hereto,
the parties expressly agree that all the terms and provisions
hereof shall be governed by, and interpreted and construed in
accordance with, the substantive laws of the State of Delaware,
without giving effect to principles relating to conflict of laws.
16.6 Severability. If any provision of this Services
Agreement or the application of any such provision to any Person
or circumstance, shall be declared judicially to be invalid,
unenforceable or void, such decision shall not have the effect of
invalidating or voiding the remainder of this Services Agreement,
it being the intent and agreement of the parties that this
Agreement shall be deemed amended by modifying such provision to
the extent necessary to render it valid, legal and enforceable
while preserving its intent or, if such modification is not
possible, by substituting therefor another provision that is
legal and enforceable and that achieves the same objective.
ARTICLE 17
TAXATION
17.1 The parties acknowledge that under this Agreement USI
may deploy IIPL employees outside the country of India. The
parties further acknowledge that this may create corporate and/or
personal taxable nexus in the jurisdictions in which services are
performed. It is the expressed intent of the parties that
Intergraph receive payment services under this Agreement provided
to or through any USI entity at the agreed prices and at the
agreed terms, as though such services were performed exclusively
within India. USI therefore acknowledges that Intergraph expects
to be indemnified by USI and held harmless from any and all
Taxes, as defined herein, including associated defense costs,
whether assessed or assessable against Intergraph, IIPL or IIPL
employees.
17.2 Prices and payment terms agreed to in this Agreement do
not include any Taxes, as defined below. Accordingly, USI (1)
agrees that any such Taxes and related expenses which are imposed
on Intergraph, IIPL or IIPL's employees are in addition to the
prices and payment terms agreed to herein; (2) agrees to
indemnify Intergraph, IIPL and IIPL's employees and hold them
harmless from such Taxes and related expense; (3) agrees that it
shall remit to Intergraph the full amount of Intergraph's price
as agreed, without reduction for such Taxes and related expenses;
(4) agrees to remit to Intergraph within 30-days of receiving an
invoice from Intergraph the total of such Taxes paid, and related
expenses, by Intergraph, IIPL or IIPL's employees as a direct
result of USI's deployment of IIPL's employees hereunder; (5)
agrees that if any payment of Taxes, and related expenses, to
Intergraph hereunder is itself taxable, then the payment will be
increased ("grossed up") as necessary so that there is no cost of
such Taxes to Intergraph, (6) agrees that the cost of any Taxes,
including related expenses, which are imposed directly on USI in
connection with services provided by IIPL employees under this
Agreement will be borne by USI alone.
17.3 "Taxes," except as otherwise provided in this paragraph
17.3, shall mean all corporate and/or personal taxation and
governmental levies or fees (including, for example but without
limiting the scope of this definition, social security,
occupational, withholding, income, excise, value added, sales,
use or other like taxes) which are imposed on Intergraph, IIPL,
or an IIPL employee as a direct result of the IIPL employee's
performance or the services under this Agreement. Taxes shall
expressly exclude only USA or India (1) federal, (2) state, (3)
municipal, (4) or other governmental income taxes, franchise
taxes, business license fees and other like taxes measured by
Intergraph's or IIPL's income, capital and/or assets and IIPL
employees' India taxes on compensation.
IN WITNESS WHEREOF, THE PARTIES HERETO HAVE CAUSED THIS
AGREEMENT TO BE DULY EXECUTED AS OF THE DAY AND YEAR FIRST ABOVE
WRITTEN.
INTERGRAPH CORPORATION
By: /s/ John W. Wilhoite
--------------------
Name: John W. Wilhoite
----------------
Title: Vice President
--------------
Date: March 2, 1998
UNIGRAPHICS SOLUTIONS INC.
By: /s/ H. Timothy Hatfield
-----------------------
H. Timothy Hatfield, Vice President
Date: March 2, 1998
TRANSITION SERVICES AGREEMENT
THIS TRANSITION SERVICES AGREEMENT (this "Services
Agreement") is made and entered into as of March 2, 1998, by and
between INTERGRAPH CORPORATION, a Delaware corporation
("Intergraph"), the other Selling Entities identified on the
signature page hereto, and UNIGRAPHICS SOLUTIONS INC., a Delaware
corporation ("USI"), and the other Acquiring Entities identified
on the signature page hereto.
W I T N E S S E T H:
WHEREAS, concurrently with the execution of this Agreement,
Intergraph and certain of the Selling Entities are selling and
transferring to USI and certain of the Acquiring Entities, and
USI and certain of the Acquiring Entities are purchasing and
acquiring from Intergraph and certain of the Selling Entities,
the assets comprising the SolidEdge/EMS business of Intergraph
pursuant to the terms of the Asset Purchase Agreement dated as of
March 2, 1998 (the "Purchase Agreement") among the parties
hereto; and
WHEREAS, pursuant to the terms of the Purchase Agreement,
the parties hereto are entering into this Services Agreement to
provide for the furnishing of certain services by Selling
Entities to the Acquiring Entities on a transition basis
following the applicable Closing (as such term and all other
capitalized terms used but not defined herein are defined in the
Purchase Agreement) under the terms set forth in this Agreement;
NOW, THEREFORE, in consideration of the premises, the
respective covenants, representations and warranties set forth
below, and other good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, and intending to be
legally bound hereby, the parties hereto agree as follows:
ARTICLE I
TERM
1.1 Stated Term. This Services Agreement commences, with
respect to the Services to be provided to a particular Acquiring
Entity, on the applicable Closing Date for that Acquiring Entity,
and will continue in effect with respect to each particular
Service for the period set forth in the applicable schedule
hereto, unless terminated earlier with respect to the Services
provided in a particular schedule by USI. An Acquiring Entity
may discontinue or terminate any Service provided to such
Acquiring Entity by 10 days written notice to Intergraph.
Intergraph may discontinue or terminate any Service in the event
of a material breach by the Acquiring Entities with respect to
such Service, but only after reasonable notice and opportunity to
cure. A notice of discontinuance may refer to more than one
Service. Any Service that is the subject of a notice of
discontinuance shall continue to be rendered by the applicable
Selling Entity until the effective date of the discontinuance set
forth in the notice of the Acquiring Entity, and the Acquiring
Entity shall pay for that Service rendered until that date.
1.2 Transition Assistance. During the term of this
Services Agreement, the Selling Entities shall comply with the
reasonable requests of the Acquiring Entities for assistance in
engaging another Person or Persons to provide, and for records
and other information relating to, the Services rendered by the
Selling Entities hereunder.
ARTICLE 2
SERVICES
2.1 Services. The Selling Entities shall render, and the
applicable Acquiring Entity shall pay for, the Services during
the term of this Services Agreement. The Services are described
on the schedules to this Services Agreement, which are an
integral part of this Services Agreement.
2.2 Charges and Expenses. For the performance of Services,
the Acquiring Entity shall pay Intergraph at the rates set forth
in the applicable Schedule to this Services Agreement relating to
such Services or as otherwise agreed upon in writing by the
parties ("Charges").
2.3 Invoice and Payment. The Selling Entities must submit
an invoice to USI, attn: Jerry Maryniak, to receive payment under
this Services Agreement. Any sum due to the Selling Entity
pursuant to this Services Agreement shall be paid within thirty
(30) days after receipt of a correct invoice therefor from the
Selling Entity. Payment for any other Services shall be
invoiced as agreed upon by the parties or, in the absence of an
agreement, upon completion of such Services. A "correct" invoice
shall contain (i) the Selling Entities' name and invoice date,
(ii) the specific order number, if applicable, (iii) description,
price, and quantity of the Services actually delivered or
rendered, (iv) credits (if applicable), and (v) name (where
applicable), title, phone number, and complete mailing address of
responsible official to whom payment is to be sent. Intergraph
shall provide other substantiating documentation or information
as may reasonably be requested by the Acquiring Entity from time
to time.
2.4 Taxes. The Acquiring Entities shall be liable for, and
shall indemnify and hold the Selling Entities harmless from and
against, all applicable sales and use, value added, consumption,
registration, stamp and similar taxes imposed upon the Charges
("Applicable Taxes"). Applicable Taxes shall not include the
Selling Entities' franchise taxes, income taxes, and other taxes
based on net or gross income. USI agrees to pay to Intergraph
any Applicable Taxes which Intergraph is required to collect and
pay over to any taxing authority or provide Intergraph with a
valid exemption certificate or other documentary evidence of
statutory exemption.
2.5 Standard of Care. Each of the Selling Entities shall
use the same care in rendering the Services as it uses in
rendering similar services to itself and that it used in
rendering the Services to the Business prior to the Closing.
2.6 Manner and Place of Performance. The applicable
Selling Entity shall render each Service in accordance with any
terms described on the corresponding Schedule. The Acquiring
Entities shall afford access to their respective premises as
necessary or reasonably appropriate to permit a Service to be
rendered.
2.7 Ownership of Work Product. Except for any intellectual
property, confidential information or proprietary materials in
which any Selling Entity has a preexisting intellectual property
right or interest ("Existing Materials"), any and all analyses,
evaluations, reports, memoranda, letters, work product or other
deliverables which are developed, prepared, conceived or made by
the Selling Entity or by any Person as part of, in connection
with, or in relationship to the performance of Services (the
"Work Product"), shall be deemed to be a "work for hire" if
consistent with the requirements of Section 101 of the Copyright
Act and shall be and remain the exclusive property of the
Acquiring Entity whether or not deemed to be a "work for hire"
within the meaning of the Copyright Act. Any rights, title and
ownership interests, including copyright, which the Selling
Entity or any Person may have in the Work Product or any tangible
media embodying such Work Product are hereby assigned to the
Acquiring Entity. The Selling Entity warrants that any Person
who is not a full-time employee of a Selling Entity whose work is
considered a "work for hire" under the Copyright Act shall be
under a written obligation to the Selling Entity requiring the
Person to assign all of Person's right, title, and interest to
the Selling Entity in and to any Work Product which is developed,
prepared, conceived or made by such Person while providing
Services on behalf of the Selling Entity.
To the extent that any Work Products incorporate
Existing Materials, the Selling Entities hereby grant to the
Acquiring Entities the right to use and display such Existing
Materials, with full rights to authorize others to do the same,
but only to the extent required to utilize the Work Product in
accordance with the ownership rights granted in this Services
Agreement.
2.8 Proprietary Rights Indemnification. The Selling
Entities represent and warrant that, to the best knowledge of the
Selling Entities without independent inquiry, the performance of
the Services do not and shall not violate or infringe upon any
copyright, patent, trade secret, or other proprietary or
intellectual property right of any third party or contribute to
such violation or infringement ("Infringement"). The Selling
Entities shall indemnify and hold the Acquiring Entities and
their affiliates and their respective successors, officers,
directors, employees, and agents harmless from and against any
and all actions, claims, losses, damages, liabilities, awards,
costs, and expenses (including legal fees) resulting from or
arising out of any breach or claimed breach of any of the
foregoing warranties, or which is based on a claim of an
Infringement and the Selling Entities shall defend and settle, at
its expense, all suits or proceedings arising therefrom.
2.9 Cross Indemnification. In the event any act or
omission of a party or its employees, servants, agents, or
representatives causes or results in (i) damage to or destruction
of property of the other party or third parties, and/or
(ii) death or injury to persons including, but not limited to,
employees or invitees of either party, then such party shall
indemnify, defend, and hold the other party harmless from and
against any and all claims, actions, damages, demands,
liabilities, costs, and expenses, including reasonable attorneys'
fees and expenses, resulting therefrom. The indemnifying party
shall pay or reimburse the other party promptly for all such
damage, destruction, death, or injury.
2.10 Relationship of Parties. The Selling Entities are
performing pursuant to this Services Agreement only as an
independent contractor. The applicable Selling Entity has the
sole obligation to supervise, manage, contract, direct, procure,
perform or cause to be performed its obligations set forth in
this Services Agreement, except as otherwise agreed upon by the
parties. Nothing set forth in this Services Agreement shall be
construed to create the relationship of principal and agent
between the Selling Entity and the respective Acquiring Entity.
Each Selling Entity shall not act or attempt to act or represent
itself, directly or by implication, as an agent of an Acquiring
Entity or its affiliates or in any manner assume or create, or
attempt to assume or create, any obligation on behalf of, or in
the name of, an Acquiring Entity or its affiliates.
ARTICLE 3
GENERAL
3.1 Notices. Any notices or other communications required
or permitted hereunder shall be given in accordance with the
provisions of Section 10.6 of the Purchase Agreement.
3.2 Assignment. This Services Agreement shall be binding
upon and inure to the benefit of the parties and their respective
successors and permitted assigns. No Acquiring Entity may assign
any right under this Services Agreement or delegate any
obligations hereunder without the express prior written consent
of Intergraph, except to another Acquiring Entity; provided,
however, that any such delegation of obligations hereunder to
another Acquiring Entity shall not relieve USI of any of its
obligations under this Agreement. No Selling Entity may assign
any rights under this Services Agreement or delegate any
obligations hereunder without the express prior written consent
of USI, provided that USI acknowledges that Foothill Capital
Corporation, Intergraph's lender, has a lien on Intergraph's
rights under this Services Agreement.
3.3 Amendments; Waivers, Etc. This Services Agreement may
not be modified or amended except by a written instrument
executed by or on behalf of each of the parties to this
Agreement. The observance of any term of this Services Agreement
may be waived (either generally or in a particular instance and
either retroactively or prospectively) by the party entitled to
enforce such term, but such waiver shall be effective only if it
is in writing signed by the party against which such waiver is to
be asserted. Unless otherwise expressly provided in this
Services Agreement, no delay or omission on the part of any party
in exercising any right or privilege under this Services
Agreement shall operate as a waiver thereof, nor shall any waiver
on the part of any party of any right or privilege under this
Services Agreement operate as a waiver of any other right or
privilege under this Services Agreement nor shall any single or
partial exercise of any right or privilege preclude any other or
further exercise thereof or the exercise of any other right or
privilege under this Services Agreement.
3.4 Governing Law. Notwithstanding the place where this
Services Agreement may be executed by any of the parties hereto,
the parties expressly agree that all the terms and provisions
hereof shall be governed by, and interpreted and construed in
accordance with, the substantive laws of the State of Delaware,
without giving effect to principles relating to conflict of laws.
3.5 Arbitration. The dispute resolution procedures set
forth in Section 10.11 of the Purchase Agreement shall apply to
any dispute, controversy or claim of any kind or nature arising
under or in connection with this Services Agreement.
3.6 Number and Gender. Unless the context otherwise
requires, the singular and plural forms in this Services
Agreement shall be mutually inclusive, and the masculine,
feminine and neuter forms in this Agreement shall be mutually
inclusive.
3.7 Severability. If any provision of this Services
Agreement or the application of any such provision to any Person
or circumstance, shall be declared judicially to be invalid,
unenforceable or void, such decision shall not have the effect of
invalidating or voiding the remainder of this Services Agreement,
it being the intent and agreement of the parties that this
Agreement shall be deemed amended by modifying such provision to
the extent necessary to render it valid, legal and enforceable
while preserving its intent or, if such modification is not
possible, by substituting therefor another provision that is
legal and enforceable and that achieves the same objective.
[THIS SPACE INTENTIONALLY LEFT BLANK]
IN WITNESS WHEREOF, the parties hereto have each caused this
Services Agreement to be duly executed by their respective duly
authorized officers or representatives, all as of the day and
year first above written.
INTERGRAPH CORPORATION
By: /s/ John W. Wilhoite
--------------------------------
John W. Wilhoite, Vice President
INTERGRAPH GMBH (OSTERREICH)
INTERGRAPH BENELUX BV
INTERGRAPH CANADA LTD.
INTERGRAPH CR S.R.O.
INTERGRAPH CAD/CAM (DANMARK) A/S
INTERGRAPH FINLAND OY
INTERGRAPH FRANCE SA
INTERGRAPH (DEUTSCHLAND) GMBH
INTERGRAPH (ITALIA) L.L.C.
INTERGRAPH JAPAN K.K.
INTERGRAPH KOREA LTD.
INTERGRAPH DE MEXICO, S.A. DE C.V.
INTERGRAPH EUROPEAN
MANUFACTURING L.L.C.
INTERGRAPH NORGE AS
INTERGRAPH EUROPE (POLSKA) SP.Z.O.O.
INTERGRAPH SYSTEMS PTE. LTD.
INTERGRAPH (PORTUGAL) SISTEMAS DE
COMPUTACAO GRAFICA S.A.
INTERGRAPH ESPANA, S.A.
INTERGRAPH (SVERIGE) AB
INTERGRAPH (SWITZERLAND) AG
INTERGRAPH (UK) LTD.
By: /s/ John W. Wilhoite
--------------------
John W. Wilhoite, as attorney in fact
UNIGRAPHICS SOLUTIONS INC.
By: /s/ H. Timothy Hatfield
-----------------------
H. Timothy Hatfield, Vice President
UNIGRAPHICS SOLUTIONS HANDELSGESELLSCHAFT M.B.H.
UNIGRAPHICS SOLUTIONS N.V.
UNIGRAPHICS SOLUTIONS CANADA LTD.
UNIGRAPHICS SOLUTIONS DANMARK A/S
UNIGRAPHICS SOLUTIONS FRANCE SAS
UNIGRAPHICS SOLUTIONS GMBH
UNIGRAPHICS SOLUTIONS S.P.A.
UNIGRAPHICS SOLUTIONS JAPAN LTD.
UNIGRAPHICS SOLUTIONS DE MEXICO,
S.A. DE C.V.
UNIGRAPHICS SOLUTIONS B.V.
UNIGRAPHICS SOLUTIONS NORGE AS
UNIGRAPHICS SOLUTIONS PTE. LIMITED
UNIGRAPHICS SOLUTIONS ESPANA, S.A.
UG SOLUTIONS AB
UNIGRAPHICS SOLUTIONS AG
UNIGRAPHICS SOLUTIONS LTD.
By: /s/ H. Timothy Hatfield
-----------------------
H. Timothy Hatfield, as attorney in fact
INTERGRAPH RESELLER AGREEMENT
(Solid Edge Version 4.0)
This Intergraph Reseller Agreement (Solid Edge Version 4.0)
(hereinafter "Agreement") is made and entered into this 2nd day
of March, 1998 (the "Effective Date") by and between Intergraph
Corporation, a Delaware corporation having its principal place of
business at Huntsville, Alabama 35894-0001 (hereinafter
"Intergraph"), and Unigraphics Solutions Inc., a Delaware
corporation having its place of business at 13736 Riverport
Drive, Maryland Heights, Missouri 63043 (hereinafter "USI").
WITNESSETH:
WHEREAS, Intergraph is engaged in the development,
manufacture, importation, distribution, sale, and support of
computer software products and the providing of technical and/or
consultative services in connection therewith; and
WHEREAS, contemporaneously herewith, Intergraph and USI and
certain of their respective affiliates have executed and
delivered that certain Asset Purchase Agreement of even date
herewith (the "Asset Purchase Agreement") pursuant to which
Intergraph has sold, transferred or licensed to USI certain
assets relating to Intergraph's "Solid Edge" product line and
line of business (the "Business"); and
WHEREAS, pursuant to the Asset Purchase Agreement,
Intergraph has sold, transferred or licensed to USI substantially
all of the assets used in the Business other than (i) the rights
of Intergraph under or in connection with its contracts with
Spatial Technology, Inc., a Delaware corporation ("STI"),
relating to certain software programs of STI marketed and sold
under the name "ACIS" (the "Retained STI Rights"), and (ii)
certain other assets related to the Business that have been
retained by Intergraph and that are more particularly described
in the Asset Purchase Agreement; and
WHEREAS, pursuant to the Asset Purchase Agreement, USI has
acquired the specified assets of the Business from Intergraph
exclusive of the Retained STI Rights, and has granted back to
Intergraph a right and license relating to such assets to permit
Intergraph to sell the computer software products listed on
Schedule 1 hereto, including Version 4.0 of Solid Edge and
Version 4.0 of Solid Edge Drafting (the "Products"), but solely
to the extent necessary to authorize Intergraph to enter into and
perform this Agreement and solely for a term that is coextensive
with the term of this Agreement; and
WHEREAS, USI wishes to become a reseller of the Products in
the manner and on the terms set forth below;
NOW, THEREFORE, in consideration of the mutual covenants and
agreements hereinafter set forth, the parties hereto do hereby
agree as follows:
1. Appointment and Sales
Intergraph hereby appoints USI as its exclusive (except
to the extent contemplated by the SolidEdge Reseller Agreement
and SolidEdge License Agreement, as each of such terms is defined
in the Asset Purchase Agreement) reseller of the Products to end-
user customers throughout the world (the "Territory"). Intergraph
shall sell, and USI shall purchase, the Products for resale in
the Territory to USI's customers (hereinafter "USI's Customers"
or "Customers").
2. Term of Agreement
This Agreement shall be in effect from and after the
Effective Date through and including (i) July 31, 1998 with
respect to USI's right hereunder to resell the Products for any
purpose or to any purchaser other than as permitted in
subparagraph (ii) of this Section 2, unless extended by mutual
written agreement of Intergraph and USI; and (ii) December 31,
2006, solely and exclusively for the purpose of permitting USI to
resell the Products to Intergraph in connection with Intergraph's
performance of the SolidEdge Reseller Agreement (as defined in
the Asset Purchase Agreement) in connection with the CAD II
Agreements (as defined in the Asset Purchase Agreement).
3. Responsibilities of USI
During the term of this Agreement, USI shall (i) devote
such efforts to promote the sale of the Products as USI shall
deem appropriate or desirable in its sole discretion, (ii)
maintain sales and technical personnel sufficient to respond to
Customer inquiries regarding Product use, care, application,
installation and service, and (iii) maintain current information
related to applicable warranty and training programs and
policies, and provide such information to USI's Customers upon
request.
4. Responsibilities of Intergraph
During the term of this Agreement Intergraph shall
make available reasonable quantities of sales kits for the
Product, and to the extent not otherwise transferred or sold to
USI pursuant to the Asset Purchase Agreement, marketing
literature, demonstration materials, and other related materials,
and ship such materials to USI within 3 business days of receipt
of USI's purchase orders therefor.
5. Prices
The Products sold hereunder shall be sold to USI
without charge except that Intergraph may charge USI for its
actual, reasonable production cost of creating or producing sales
kits containing the Products. Any such charges shall be paid by
USI within 30 days of receipt of Intergraph's invoice therefor.
6. Purchase Orders
USI may place written purchase orders for Products from
time to time during the term of this Agreement. Each purchase
order placed by USI shall contain the following minimum
information: (i) a reference to this Agreement Number, (ii)
identification of each Product ordered by part number, quantity
and net price; (iii) shipping instructions and destination, and
(iv) requested delivery date of each Product.
7. Delivery, Title, Risk of Loss, Record
(A) All Product shipments shall be F.O.B. Intergraph's
dock unless otherwise requested in writing by USI (in which case
all shipping costs shall be at USI's expense).
(B) In the event of any loss or damage to Products
following delivery to an Intergraph selected carrier, USI shall
cooperate with Intergraph in connection with any proof of loss or
claim presented by Intergraph to the carrier and/or insurer.
Title to software furnished by Intergraph shall remain with
Intergraph or relevant third parties as determined by Intergraph,
subject to and in accordance with the applicable Intergraph
software license agreement then in effect.
8. Taxes
USI shall be liable for, and shall indemnify and hold
Intergraph harmless from and against, all applicable sales and
use, value added, consumption, registration, stamp and similar
taxes imposed upon the amounts payable by it to Intergraph
hereunder ("Applicable Taxes"). Applicable Taxes shall not
include Intergraph's franchise taxes, income taxes, and other
taxes based on net or gross income. USI agrees to pay to
Intergraph any applicable Transaction Taxes which Intergraph is
required to collect and pay over to any taxing authority or
provide Intergraph with a valid exemption certificate or other
documentary evidence of statutory exemption.
9. Warranty
(A) Warranties on Products purchased from Intergraph
may be passed through to the end user.
(B) Intergraph warrants that, for the period stated in
Intergraph's then current Business Partner Price Book (a copy of
which shall have been furnished to USI), each Intergraph software
Product will perform in accordance with the published Intergraph
specifications applicable to said Product on the date of
shipment. Intergraph also warrants that any third party software
it provides will, for the period stated in Intergraph's then
current Business Partner Price Book, perform in accordance with
the developer's specifications for the version of software
provided. Modification of any software furnished by Intergraph
by any entity other than Intergraph, without the express written
permission of Intergraph, voids this warranty.
(C) Intergraph shall, in accordance with its then
current policies and at its sole discretion, repair or replace
any Product found to be in non-conformance with the above
warranties during the warranty period.
(D) THE ABOVE WARRANTIES ARE IN LIEU OF ALL OTHER
WARRANTIES, EXPRESSED OR IMPLIED, AND REPRESENT THE FULL AND
TOTAL OBLIGATION AND/OR LIABILITY OF INTERGRAPH; PROVIDED,
HOWEVER, THAT THE FOREGOING SHALL NOT BE DEEMED TO LIMIT, MODIFY
OR OTHERWISE AFFECT THE REPRESENTATIONS AND WARRANTIES CONTAINED
IN THE ASSET PURCHASE AGREEMENT. EXCEPT AS SET FORTH IN THE
ASSET PURCHASE AGREEMENT, INTERGRAPH DISCLAIMS ALL OTHER
WARRANTIES, WHETHER EXPRESS OR IMPLIED, INCLUDING ALL WARRANTIES
OF MERCHANTABILITY AND FITNESS FOR PARTICULAR PURPOSE. Certain
limitations set forth in the above disclaimer may not apply in
some jurisdictions.
10. Infringement
(A) Intergraph shall defend and indemnify USI from and
against judgments, damages, costs and claims arising as a result
of USI's sale of the Products by virtue of any infringement or
misappropriation of a valid United States patent, copyright,
trademark or other proprietary right, provided that: (1) USI
shall have given timely notice thereof to Intergraph; (2) USI
provides reasonable cooperation, information and assistance in
connection therewith; and (3) Intergraph shall have the sole and
exclusive control and authority with respect to the defense or
settlement thereof, provided that Intergraph shall not enter into
any settlement that would cause irreparable harm to USI.
Notwithstanding the foregoing, in the event of any such claim or
Intergraph's determination that such claim is likely to occur,
Intergraph shall have the right to require USI to cease using and
selling that portion of the Products claimed (or likely to be
claimed) to be infringing. In the event of such election by
Intergraph or in the event of an injunction of any nature or any
other event that would prevent USI from selling the Products,
Intergraph shall, at Intergraph's option, (A) acquire for USI the
right to continue using that portion of the Products claimed (or
likely to be claimed) to be infringing; or (B) replace such
portion for USI with other software for which there exists no
infringement claim and which, in all material respects, provides
the same functions as such portion of the Products which is
claimed (or likely to be claimed) to be infringing.
(B) Intergraph shall have no liability or obligation
to USI with respect to an infringement claim or allegation
arising from: (1) the use of the Product in combination with
devices (other than computers and peripherals) or other products
where the use of the alleged infringing Product, by itself, would
not be infringing unless the Product was intended to be used with
such other devices or products; (2) use of the Product in an
application or environment for which such Product was not
designed or contemplated; (3) modification of the Product by any
entity other than Intergraph (other than ordinary course
modifications); or (4) any claims of infringement in which USI
has an interest or license in the alleged infringed right.
(C) This section shall survive the expiration or
termination of the Agreement.
(D) THE ABOVE WARRANTIES ARE IN LIEU OF ALL OTHER
WARRANTIES, EXPRESSED OR IMPLIED, AND REPRESENT THE FULL AND
TOTAL OBLIGATION AND/OR LIABILITY OF INTERGRAPH; PROVIDED,
HOWEVER, THAT THE FOREGOING SHALL NOT BE DEEMED TO LIMIT, MODIFY
OR OTHERWISE AFFECT THE REPRESENTATIONS AND WARRANTIES CONTAINED
IN THE ASSET PURCHASE AGREEMENT. EXCEPT AS SET FORTH IN THE
ASSET PURCHASE AGREEMENT, INTERGRAPH DISCLAIMS ALL OTHER
WARRANTIES, WHETHER EXPRESS OR IMPLIED, INCLUDING ALL WARRANTIES
OF MERCHANTABILITY. Certain limitations set forth in the above
disclaimer may not apply in some jurisdictions.
(E) This section shall survive the expiration or
termination of this Agreement.
11. Software License and Right to Sub-license
(A) All software Products furnished by Intergraph
hereunder shall be subject to a license agreement in the form
attached hereto as Exhibit A.
(B) Intergraph hereby grants to USI, and USI hereby
accepts, an exclusive right to sub-license and distribute the
Products, subject to the terms and conditions of attached license
agreement form.
(C) Intergraph does not grant the right to USI to make
copies of the software Products in any form except when permitted
by written agreement with Intergraph. Source code for software
furnished by Intergraph shall not be provided pursuant to this
Agreement to USI or to any of its Customers.
(D) USI shall take reasonable steps to enforce all sub-
licenses obtained by USI. If a USI Customer shall fail to
fulfill any of its obligations under the applicable software
license agreement, then Intergraph may, at any time, upon its
election and in addition to other remedies that it may have,
notify USI in writing of such breach and request USI, by written
notice, to terminate all rights granted by USI to the Customer
then in breach. USI shall honor Intergraph's request unless
doing so would result in irreparable harm to USI.
(E) For purposes of supplying Products to USI
hereunder, and only for such purposes, USI hereby grants a non-
exclusive, royalty-free, non-transferable license to the Licensed
Property, as that term is defined in the License Agreement for
Solid Edge Specific Code (the "Solid Edge License") entered into
concurrently herewith (the "License"). This License shall be
limited to the term of this Agreement. In addition, Intergraph
shall be subject to the obligations of Sections 2, 6, 7, 8, 10,
and 11 of the of the Solid Edge License in performing its
obligations under this Agreement. Those provisions are hereby
incorporated into this Agreement with the same meaning and scope
as under the Solid Edge License and the obligations of Intergraph
pursuant to those provisions shall survive termination or
expiration of this Agreement.
12. Termination
(A) This Agreement shall terminate at the end of the
term set forth in Section 2 hereof or upon the mutual written
agreement of Intergraph and USI to terminate this Agreement.
(B) This Agreement may be terminated by Intergraph (i)
upon the dissolution, liquidation, insolvency or bankruptcy of
USI, or (ii) upon the occurrence of any material violation of
applicable law by USI in connection with its obligations under
this Agreement (including without limitation, any export law)
which violation could reasonably be expected to expose Intergraph
to Losses (as defined in the Asset Purchase Agreement); provided,
that such violation did not exist prior to the Principal Closing
Date (as defined in the Asset Purchase Agreement).
(C) Termination of this Agreement shall not release
USI from the obligation to pay Intergraph any sums, whether then
or thereafter due, or operate to discharge any liability which
has been incurred by Intergraph or by USI, prior to the effective
date of such termination.
(D) Immediately upon the termination of this
Agreement, USI shall cease to represent itself as an authorized
reseller of Intergraph Products and shall otherwise discontinue
all conduct and activities which might lead the public to believe
that USI is authorized to sell Intergraph Products.
13. Specified Maintenance Assistance
In the event that any USI Customer shall request
maintenance or support of any Product from USI, USI shall provide
such maintenance, upon such terms and conditions and for such
price as USI determines to provide in its sole discretion (either
through the release of a later version of such Product or
otherwise); provided, however, that if any such request for
maintenance or support would involve or require USI to have
access to any Retained STI Rights, USI shall not be obligated to
provide such maintenance or support and shall refer such request
to Intergraph. Upon receipt of such request, Intergraph shall
provide such maintenance or support (or, if permitted by its
contracts with STI, require STI to provide such maintenance or
support and pass through the benefits thereof to USI's Customer).
In no event shall USI be permitted or required to provide
maintenance or support that would involve or require USI to have
access to any Retained STI Rights (including, without limitation,
any source code for the ACIS products).
14. Notices
Any notice or communication given pursuant to this
Agreement shall be given in writing in accordance with the
provisions of the Asset Purchase Agreement.
15. General
(A) Intergraph and USI shall be independent
contractors only, and no legal partnership or agency relationship
is intended to be created. Neither party shall hold itself out
to be an agent of the other, nor as being entitled to
contractually bind the other in any way.
(B) Neither party shall, nor shall they authorize any
third party to, do any act, or fail to do any act, which would
jeopardize, invalidate or be inconsistent with any copyright,
trademark or other intellectual property rights of the other
party.
(C) Failure by either party to enforce any term or
condition of this Agreement shall not be construed as a waiver,
or prevent or bar enforcement of any term or condition.
(D) If any provision of this Agreement should be held
to be unenforceable, the remaining provisions shall continue to
be of full force and effect.
(E) Neither party shall be deemed to be in default of
any provision hereof, or liable for any delay or failure in
performance, or interruption of service, resulting from an act of
God, war, civil or military authority, civil disturbance, strike,
inability to obtain components from usual sources, or any other
cause beyond its reasonable control.
(F) To the extent that representations, warranties,
and/or commitments which are not stated in this Agreement (or the
exhibits hereto) are extended to Customer by USI, such
representations, warranties and/or commitments shall be solely
those of USI and will not be attributed to Intergraph, nor bind
Intergraph to any performance. USI agrees to indemnify, save
harmless, and defend Intergraph, its officers, directors and
employees from and against all claims, losses or damages of any
kind whatsoever arising by reason of, or in connection with, any
representations, warranties, and/or commitments made by USI.
This section shall survive the expiration or termination of this
Agreement.
(G) This Agreement may not be assigned or transferred
to any person or entity other than an Affiliate of a party (as
defined in the Asset Purchase Agreement) without the prior
written consent of the other party.
(H) USI hereby acknowledges and agrees that Intergraph
may, in its discretion, disclose the terms and conditions of this
Agreement to STI.
(I) USI hereby agrees that during the term of this
Agreement and for a period of 3 years following the termination
hereof, none of the employees listed on Exhibit B (the
"Identified Employees") shall be transferred or reassigned by USI
to operations of USI or its Affiliates located in Cambridge,
England, or otherwise engaged in work relating to USI's Parasolid
modeler.
(J) Notwithstanding any provision of the Asset
Purchase Agreement to the contrary, USI hereby acknowledges and
consents to execution by each of the Identified Employees of a
confidentiality agreement in favor of Intergraph in substantially
the form of (i) Exhibit C for Identified Employees designated as
"developers" on Exhibit B, or (ii) Exhibit D for Identified
Employees designated as "managers" on Exhibit B.
16. Governing Law and Dispute
This Agreement shall be governed, interpreted and
construed in accordance with the laws of the State of Delaware.
17. Entire Agreement
This Agreement (including the exhibits hereto)
constitutes the entire Agreement and understanding between the
parties, and shall supersede all other agreements, oral or
written, made between the parties with respect to such subject
matter. This Agreement shall supersede the terms and conditions
in any USI purchase order form or acknowledgment form. This
Agreement shall not be amended or modified except by written
agreement of the parties.
SIGNED FOR AND ON BEHALF OF: SIGNED FOR AND ON BEHALF OF:
UNIGRAPHICS SOLUTIONS INC. INTERGRAPH CORPORATION
SIGNATURE:/s/ H. Timothy Hatfield SIGNATURE:/s/ John W. Wilhoite
NAME: H. Timothy Hatfield NAME: John W. Wilhoite
TITLE: Vice President TITLE: Vice President
DATE: March 2, 1997 DATE: March 2, 1997
EXHIBIT A
Place Serial Number Label Here
This License Agreement is your proof of license. Please treat it as valuable
property.
Shrink Wrap Software License Agreement and Limited Product Warranty
You should carefully read the following terms and conditions before opening this
program package. To the extent permitted by law, opening this package indicates
your acceptance of these terms and conditions. If you do not agree with them,
you should promptly return this media package unopened for a full refund.
LICENSE AND LIMITED WARRANTY:
Intergraph Corporation provides this program and licenses its use to you. You
assume responsibility for the selection of this program to achieve your intended
results, and for the installation, use and results obtained from this program.
THIS PROGRAM IS A PROPRIETARY PRODUCT OF INTERGRAPH CORPORATION AND ADDITIONAL
THIRD PARTIES, AND IS PROTECTED BY COPYRIGHT LAWS. TITLE TO THIS PROGRAM, OR
ANY COPY, MODIFICATION OR MERGED PORTION OF THIS PROGRAM SHALL AT ALL TIMES
REMAIN WITH INTERGRAPH CORPORATION AND SUCH THIRD PARTIES.
License
a. "Concurrent-use software" is designated by CU in the product description.
Each license for CU software permits a single concurrent use on the specified
type of workstation and operating system. If you have multiple licenses for the
software, then at any time you may have as many copies of software in use as you
have licenses. There is a single use of CU software when it is loaded into
memory for execution or when it is stored on hard disk, or both, on a single
workstation. A copy stored on hard disk on a network server for the sole
purpose of execution by network workstations is not in use on the network
server. If the anticipated number of users of the software will exceed the
number of applicable licenses, then you must have a reasonable mechanism or
process in place to assure that the number of persons using the software
concurrently does not exceed the number of licenses.
b. "Server software" is designated by VR in the product description. A single
copy of VR software may be stored on hard disk and loaded for execution on the
specified type of network server and operating system. Each licenses for VR
software permits a designated number of users to simultaneously access the
software on the network server. It is the responsibility of the licensee to
assure that no more than the licensed number of users access the VR software
simultaneously at any one time.
c. "Single-use software" is designated by SU in the product description. Each
license for SU software permits a single copy to be stored on hard disk and
loaded for execution on a single designated type of workstation and operating
system. It is the responsibility of the licensee to assure that SU software is
not moved to a second workstation until it has been completely removed from the
first workstation.
d. "Right-to-run license" grant is designated by CN in the product desription
for concurrent-use software, SN for single-usage software, and VN for server
software, where N is a nubmer indicating the number of Right-to-run licenses
granted. Each Right-to-run license permits the licensee to make one additional
licensed use of the CU, SU, or VR software product separately licensed, under
all the terms of this license agreement. In addition, licensee is permitted to
make up to N additional copyies of the CU or SU software product as may be
necessary for such additional licensed use.
e. "Named User software" is designated by NU in teh product description. A
Named User is defined as a individual employed by the licensee who is authorized
by the licensee to use the Product and Associated Product programs on the
Designated System under the terms of the license agreement, regardless of
whether the individual is actively using the Product programs at any given time.
The number of named users is determined by simply counting the number of people
who will have access to the programs. Two categories of Named Users are
available: (i) Author - A full function user, able to access all system
capabilities, (ii) Consumer - A limited function user able to access only query
and viewing capabilities.
f. If Cu, SU, or SN software is permanently stored on the hard disk of a
workstation and one person uses that workstation more than 80% of the time it is
in use, then that person may also use the software either on a portable computer
or on a home computer.
g. If this software is puchased as an upgrade or provided as an update to a
previous version of licensed software, this software may be used only to
replace the previous version, and no additional licnese is granted. This
software and the previous version may not be separately used or transferred to
a third party.
You may:
1. Copy this program into any machine readable or printed form for backup
purposes in support of your licensed use of the program.
2. Modify this program and/or merge it into another program for licensed use
(any portion of this program merged into another program will continue to be
subject to the terms and conditions of this Agreement);
3. Transfer this program and license to another party if the other party agrees
to accept the terms of this Agreement. If you transfer this program, you must
at the same time either transfer all copies, modifications or merged portions,
in whatever form, to the same party, or destroy those not transferred.
You must reproduce and include the copyright notice on any copy, modification
or portion of this program merged into another program.
You may not decompile, disassemble or otherwise reverse engineer this program.
You may not use, copy, modify, or transfer this program, or any copy,
modification or merged portion, in whole or in part, except as expressly
provided for in this Agreement. If you do transfer possession of any copy,
modification or merged portion of the program to another party except as
expressly provided, your license is automatically terminated.
Term
The license is effective until terminated. You may terminate it at any time by
destroying this program together with all copies, modifications and merged
portions in any form. It will also terminate upon conditions set forth
elsewhere in this Agreement or if you fail to comply with any term or condition
of this Agreement, or if you fail to pay the appropriate license fee(s). You
agree upon termination to destroy this program together with all copies,
modifications and merged portions in any form.
Intergraph's Warranties and Your Remedies
a. Intergraph warrants for a period of thirty (30) days from the date of
shipment that, under normal use, software delivery media will be free of defects
in material and workmanship. You acknowledge and agree that Intergraph will
satisfy this warranty if it corrects errors which appear in this program or in
the user manuals, reported to Intergraph during the warranty period.
INTERGRAPH DOES NOT WARRANT THAT ANY INTERGRAPH PRODUCT WILL MEET YOUR
REQUIREMENTS AND UNDER NO CIRCUMSTANCES DOES INTERGRAPH WARRANT THAT ANY
INTERGRAPH PRODUCT WILL OPERATE UNINTERRUPTED OR ERROR FREE.
Intergraph warrants and represents that is has the right to grant the license.
The foregoing warranties are void if failure of a warranted item results,
directly or indirectly, from an unauthorized modification to a warranted item;
an unauthorized attempt to repair a warranted item; or misuse of a warranted
item, including without limitation use of warranted item under abnormal
operating conditions or without routinely maintaining a warranted item. You
agree to promptly notify Intergraph of any suspected defects in software
delivery media or this program.
THE FOREGOING WARRANTIES ARE GIVEN IN LIEU OF ALL OTHER WARRANTIES, WHETHER
EXPRESS OR IMPLIED, INCLUDING BUT NOT LIMITED TO THE WARRANTIES OF
MERCHANTABILITY AND FITNESS FOR A PARTICULAR PURPOSE.
b. Intergraph's entire liability and your exclusive remedy shall be, in
Intergraph's sole and absolute discretion, either (i) the repair or replacement
of any warranted item which does not meet the respective warranties given above,
or (ii) a refund of the purchase price of the warranted item.
c. The above warranties and limitations give you specific legal rights, and you
may also have other rights which vary from jurisdiction to jurisdiction.
Certain limitations set forth in this section may not apply in some
jurisdictions.
Limitation of Damages
In no event will Intergraph be liable to you for any damages, inlcuding but not
limited to any incidental, special or consequential damages, arising out of or
in connection with the use or inability to use this program or software delivery
media. Except as otherwise provided by applicable law, no claim, regardless of
form, arising out of or in connection with this Agreement may be brought by you
more than two (2) years after the cause of the action has accrued.
General
If this program is acquired directly or indirectly on behalf of a unit or agency
of the United States Government, this provision applies. For civilian agencies:
This proram was developed at private expense and is "restricted computer
software" submitted with restricted rights in accordance with subparagraphs (a)
through (d) of the Commercial Computer Software - Restricted Rights clause at
52.227-19 of the Federal Acquisition Regulations ("FAR") and its successors, and
is unpublished and all rights are reserved under the copyright laws of the
United States. For units of the Department of Defense ("DoD"): This program
is licensed only with "Restricted Rights" as that term is defined in the DoD
Supplement to the FAR, clause 252.227-7013 (1)(ii), Rights in Technical Data
and Computer Software and its successors, and use, duplication or disclosure is
subject to the restrictions set forth therein.
Any attempt to sublicense, assign or transfer the license or the program except
as expressly provided in this Agreement is void. If a portion of this Agreement
is held unenforceable, the rest of this Agreement shall remain enforceable.
This Agreement will be governed by the laws of the State of Alabama.
Should you have any questions concerning this Agreement, you may contact your
local Intergraph office or Intergraph Corporation by calling 1-800-345-4856 or
writing Intergraph Corporation, Huntsville, AL 35894-0001.
You acknowledge that you have read this Agreement, understand it and agree to
be bound by its terms and conditions. You further agree that it is the
complete and exclusive statement of the agreement between us which supercedes
any proposal or prior agreement, oral or written, and any other communications
between us relating to the subject matter of this Agreement.
SUPPORT SERVICES:
Intergraph will provide Complimentary Service during the warranty period.
Complimentary Service will be limited to telephone support for bug reports,
installation, and basic operation, excluding customization. To use
Complimentary Service, call Intergraph's customer service hotline:
1-800-633-7248. Intergraph will accept customer reports of problems found, but
after the warranty period you will be required to purchase updated or corrected
software. If you obtained this program from an authorized dealer you should
contact the dealer for support.
UPDATES:
Upgrades, when and as available, will be provided at a separate charge. In
order to recieve notices of updates and enhancements, you must complete and
return that enclosed registration form.
Brands and product names are trademarks of their respective owners.
EXHIBIT B
IDENTIFIED EMPLOYEES
Name Status
William Cecil, Jr. Developer
Mallikarjuna Gandikota Developer
Variraj Mysore Developer
Qingxiang Niu Developer
Navin Pai Developer
Chiranjeevi Rao Panuganty Developer
Rajkumar Radhakrishnan Developer
Madhukar Sareddy Developer
Dennis Weldy Developer
Steven Wixson Developer
Sunit Mangalvedhekar Manager
William H. McClure Manager
Daniel Staples Manager
FORM - DEVELOPER
EXHIBIT C
February , 1998
[Intergraph Employee]
[Employee Address]
Dear :
Intergraph intends to transfer a substantial portion of the
assets of its Mechanical Group, including its Solid Edge line of
products (the "Proposed Solid Edge Disposition"), to Unigraphics
Solutions Inc. ("USI") on or about March 1, 1998 or as soon as
possible thereafter.
Pursuant to various agreements, Spatial Technology, Inc.
("STI") has granted a development license to Intergraph for certain
computer software (in either object code or source code form),
including without limitation, certain software marketed and sold
under the name "ACIS" (the "ACIS Software"). You have been
employed by Intergraph as a software developer in the Mechanical
Group, and as a consequence, have had access to and used the source
code relating to the ACIS Software and have embedded such source
code in Intergraph's Solid Edge products. As you know, the source
code relating to the ACIS Software, the related documentation, the
terms of Intergraph's agreements with STI, and other confidential
information made available to Intergraph (and through Intergraph to
you) by STI (collectively, the "ACIS Confidential Information") are
confidential and proprietary to Intergraph and STI. Neither the
source code relating to the ACIS Software nor the contract rights
of Intergraph under its agreements with STI are being transferred
to USI in connection with the Proposed Solid Edge Disposition.
As a result of the Proposed Solid Edge Disposition, you and we
anticipate that you will be offered employment with USI and, if you
accept such offer, will continue to work on software development
activities relating to the Solid Edge line of products. We request
that you acknowledge that the ACIS Confidential Information is
confidential and proprietary to STI and Intergraph, and that such
information has been treated as such by you. We further request
that you confirm your agreement that, if and when the Proposed
Solid Edge Disposition is consummated, you will (i) continue to
treat the ACIS Confidential Information as confidential and
proprietary information of STI and Intergraph, (ii) refrain from
using the ACIS Confidential Information for the benefit of USI or
any other person or entity, (iii) refrain from disclosing the ACIS
Confidential Information to USI or its employees, officers or
consultants or any other person or entity without the prior written
consent of Intergraph and STI, and (iv) refrain from removing from
Intergraph any data, materials, records, reports, lists, tests,
object code, source code, manuals, analyses, in whatever media or
form, which relate to the ACIS Software or the ACIS Confidential
Information. In connection with the Proposed Solid Edge
Disposition, USI has been made aware of this letter agreement and
has consented to your execution of it. The foregoing
acknowledgment and agreement is in addition to any other obligation
of confidentiality you may have to Intergraph, whether arising by
contract or operation of law.
Yours very truly,
Intergraph Corporation
By:
---------------------------
Title:
------------------------
Read, Acknowledged and
Agreed to this______ day
of February, 1998
- -----------------------
[Name of Employee]
FORM - MANAGER
EXHIBIT D
February ____, 1998
[Intergraph Employee]
[Employee Address]
Dear _____________________:
Intergraph intends to transfer a substantial portion of the
assets of its Mechanical Group, including its Solid Edge line of
products (the "Proposed Solid Edge Disposition"), to Unigraphics
Solutions, Inc. ("USI") on or about March 1, 1998 or as soon as
possible thereafter.
Pursuant to various agreements, Spatial Technology, Inc.
("STI") has granted a development license to Intergraph for certain
computer software (in either object code or source code form),
including without limitation, certain software marketed and sold
under the name "ACIS" (the "ACIS Software"). You have been
employed by Intergraph as a manager in the Mechanical Group, and as
a consequence, you may have had access to the source code relating
to the ACIS Software and other information concerning Intergraph's
relationship with STI. As you know, the source code relating to
the ACIS Software, the related documentation, the terms of
Intergraph's agreements with STI, and other confidential
information made available to Intergraph (and through Intergraph to
you) by STI (collectively, the "ACIS Confidential Information") are
confidential and proprietary to Intergraph and STI. Neither the
source code relating to the ACIS Software nor the contract rights
of Intergraph under its agreements with STI are being transferred
to USI in connection with the Proposed Solid Edge Disposition.
As a result of the Proposed Solid Edge Disposition, you and we
anticipate that you will be offered employment with USI and, if you
accept such offer, will continue to work on software development
activities relating to the Solid Edge line of products. We request
that you acknowledge that the ACIS Confidential Information is
confidential and proprietary to STI and Intergraph, and that such
information has been treated as such by you. We further request
that you confirm your agreement that, if and when the Proposed
Solid Edge Disposition is consummated, you will (i) continue to
treat the ACIS Confidential Information as confidential and
proprietary information of STI and Intergraph, (ii) refrain from
using the ACIS Confidential Information for the benefit of USI or
any other person or entity, (iii) refrain from disclosing the ACIS
Confidential Information to USI or its employees, officers or
consultants or any other person or entity without the prior written
consent of Intergraph and STI, and (iv) refrain from removing from
Intergraph any data, materials, records, reports, lists, tests,
object code, source code, manuals, analyses in whatever media or
form, which relate to the ACIS Software or the ACIS Confidential
Information. In connection with the Proposed Solid Edge
Disposition, USI has been made aware of this letter agreement and
has consented to your execution of it. The foregoing
acknowledgment and agreement is in addition to any other obligation
of confidentiality you may have to Intergraph, whether arising by
contract or operation of law.
Yours very truly,
Intergraph Corporation
By:
--------------------------
Title:
-----------------------
Read, Acknowledged and
Agreed to this ____ day
of February, 1998
[Name of Employee]
TRADEMARK LICENSE AGREEMENT
("Unigraphics EMS/Solid Edge Products and Services")
THIS AGREEMENT made and entered into as of March 2,
1998, by and between Intergraph Corporation, a Delaware
corporation having its principal place of business at One
Madison Industrial Park, Huntsville, Alabama 35894
("Unigraphics"), and Unigraphics Solutions Inc., a Delaware
corporation having its principal place of business at 13736
Riverport Drive, Maryland Heights, Missouri 63043
("Intergraph").
W I T N E S S E T H:
WHEREAS, contemporaneously herewith, Intergraph and
Unigraphics and certain of their respective affiliates have
executed and delivered that certain Asset Purchase Agreement
dated March 2, 1998 (the "Asset Purchase Agreement") with
respect to the sale, transfer, or license by Intergraph to
Unigraphics of certain assets relating to the Business (as
defined in the Asset Purchase Agreement);
WHEREAS, contemporaneously herewith, Intergraph and
Unigraphics and certain of their respective affiliates have
executed and delivered that certain Solid Edge Common Code
License Agreement and that certain Bag Products License
Agreement which are Exhibit I and Exhibit J, respectively,
to the Asset Purchase Agreement (collectively, the "License
Agreements")
WHEREAS, Intergraph is the owner of various Trademarks
which have been registered with the United States Patent &
Trademarks Office as set forth on Exhibit 1 attached hereto,
and Intergraph claims common law rights in and to certain
Trademarks as set forth in Exhibit 1 attached hereto
(hereinafter collectively referred to as the "Trademarks");
WHEREAS, Unigraphics desires to use the Trademarks in
connection with the exclusive and non-exclusive licenses
granted by Intergraph pursuant to the respective License
Agreements ("business purpose"); and
WHEREAS, Intergraph is willing to grant permission to
Unigraphics to use the Trademarks in connection with
activities pursuant to the Asset Purchase Agreement and the
respective License Agreements;
NOW, THEREFORE, in consideration of the premises, and
other good and valuable consideration received, the receipt
and sufficiency of which is hereby acknowledged, Intergraph
and Unigraphics agree as follows:
ARTICLE I. DEFINITIONS, LICENSE, AND TERM
1. Definitions.
For the purposes of this Agreement, the following terms
shall have the meaning set forth below:
(a) Capitalized terms used in this Agreement shall
have the meanings provided in the Asset Purchase Agreement,
except the capitalized term listed below which shall have
the meaning set forth opposite such term:
(b) "Product" shall mean the Unigraphics service or
services or product or products developed, sold, and/or
marketed by Unigraphics as part of the EMS and/or Solid Edge
lines of business acquired by Unigraphics from Intergraph
pursuant to the Asset Purchase Agreement.
1.2 License.
In accordance with this Agreement, Intergraph hereby
grants to Unigraphics a non-exclusive, world-wide, royalty-
free, nontransferable license to the Trademarks which are
described in detail in Exhibit 1 attached hereto and
incorporated by reference herein, for Unigraphics' use to
represent any Product which is substantially the same as the
goods (including new versions thereof) and services offered
and sold by Intergraph in connection with each Trademark
immediately before the Principal Closing as part of
Unigraphics' business purpose regarding the License
Agreements (the "License").
1.3 Term.
The term of this Agreement shall commence on the
Effective Date and shall continue until March 1, 2000 (the
"Term"). Should Unigraphics desire to use the Trademarks
beyond the Term of this Agreement, then the parties shall
negotiate in good faith, given their other business
activities relating to such Trademarks, to enter into a new
or modified royalty-free trademark license.
ARTICLE II. OWNERSHIP AND USE OF TRADEMARK LICENSE
2.1 Ownership of Trademarks.
As between Unigraphics and Intergraph, Intergraph is
the exclusive owner of the Trademarks. Unigraphics
acknowledges the substantial value of the goodwill
associated with the Trademarks and that the Trademarks and
all rights therein and the goodwill pertaining thereto
belong solely and exclusively to Intergraph. Under no
circumstances shall any provision of this Agreement be
construed as granting, by implication, estoppel, or
otherwise, a license to any of Intergraph's technology,
proprietary rights, software, or other intellectual
property, other than the permitted use of each Trademark
pursuant to Section 1.2 hereof.
2.2 Quality, Inspection, and Approval.
Unigraphics covenants and agrees that:
(a) Unigraphics shall maintain the quality of each
Product used in connection with each Trademark at a level
that meets or exceeds industry standards and is at least
commensurate with the quality of any similar product
previously distributed by Intergraph or Unigraphics, and
each Product shall meet the applicable quality standards
described in this Agreement;
(b) Unigraphics shall supply Intergraph with suitable
specimens of each Product and Unigraphics' use of each
Trademark in connection with such Product at the times and
in the manner reasonably requested by Intergraph; and
Unigraphics shall cooperate fully with Intergraph to
facilitate periodic review of Unigraphics' use of each
Trademark and of Unigraphics' compliance with the quality
standards described in this Agreement. All specimens shall
be used for purposes of quality control and review under
this Agreement and shall be returned within 60 days;
(c) Unigraphics shall remedy any failure to meet the
standards established by this Section 2.2(a) upon
reasonable notice from Intergraph;
(d) Unigraphics shall promptly notify Intergraph of
any suspected infringement of or challenge to any Trademark.
Unigraphics shall not knowingly violate or infringe any
trademark right of any third party through its use of the
Trademarks. Nothing herein shall be interpreted to diminish
or change any provision of the Asset Purchase Agreement,
including but not limited to the representations and
warranties and indemnification provisions contained therein.
2.3 Identification and Use.
(a) Unigraphics shall comply with all applicable laws,
rules, and regulations relating to the use of the Trademarks
and Unigraphics shall mark every use of each Trademark with
the trademark designations required by applicable law or as
Intergraph may reasonably request from time to time and
shall reasonably comply with Intergraph's trademark use
guidelines for the respective Trademarks, as such may exist
from time to time. Unigraphics shall mark all packaging and
advertising materials with proper trademark notice.
(b) Unigraphics acknowledges Intergraph's ownership of
each Trademark, shall use each Trademark solely as provided
in this Agreement and in a manner that will not derogate
from Intergraph's rights in such Trademark, and shall take
no action that will interfere with or diminish Intergraph's
rights in such Trademark (including, diminishing
Intergraph's goodwill in a Trademark or using a Trademark in
a manner that is likely to result in confusion with any use
of such Trademark by Intergraph or of any other mark by
Intergraph), during the term of this Agreement. Unigraphics
agrees not to adopt, use, or register any corporate name,
trade name, trademark, service mark, or certification mark,
or other designation confusingly similar to or containing in
whole or in part any Trademark. Unigraphics agrees that all
use of any Trademark by Unigraphics will inure to the
benefit of Intergraph. Unigraphics shall not use any
Trademark in any way as an endorsement or sponsorship of any
product of Intergraph.
2.4 Reversion of Rights.
Upon and after the expiration or termination of this
Agreement, the License and all rights granted to Unigraphics
hereunder shall immediately and forthwith revert to
Intergraph without any further action by or on behalf of
Intergraph, and all goodwill pertaining thereto shall belong
to Intergraph, and Unigraphics shall discontinue and refrain
from further use of any Trademark or any further reference
to it (whether direct or indirect) or use of any mark deemed
by Intergraph to be confusingly similar to any Trademark in
connection with the manufacture, sale, or distribution of
any product or any good and service otherwise manufactured,
sold, or distributed by Intergraph.
2.5 Assignability.
The rights and obligations of Unigraphics under this
Agreement are personal and may not be transferred (either by
operation of law or otherwise), assigned or sublicensed,
including but not limited to the grant of any security
interest, and any such transfer shall render the License
void and unenforceable.
ARTICLE III. MISCELLANEOUS
3.1 Arbitration.
In the event of any dispute or claim arising under
or in connection with this Agreement which the parties are
unable to resolve through informal discussions or
negotiation, the parties agree to submit such dispute or
claim to arbitration in accordance with the procedures set
forth in the Asset Purchase Agreement.
3.2 General Provisions.
(a) This Agreement sets forth the entire agreement and
understanding between the parties as to the subject matter
hereof and merges all prior discussions between them, and
neither of the parties shall be bound by any conditions,
definitions, warranties, understandings, or representations
with respect to such subject matter other than as expressly
provided herein or as set forth in that certain Asset
Purchase Agreement or as set forth on or after the date
hereof in a writing signed by a duly authorized
representative of each party intending to be bound thereby.
(b) The headings found in this Agreement are for
reference purposes only and are to be given no effect in the
construction of this Agreement.
(c) This Agreement may be executed in one or more
counterparts, each of which shall be an original, but all of
which shall, together, constitute one and the same
instrument.
(d) If any provision of this Agreement or the
application of any such provision to any Person or
circumstance, shall be declared judicially to be invalid,
unenforceable or void, such decision shall not have the
effect of invalidating or voiding the remainder of this
Agreement, it being the intent and agreement of the parties
that this Agreement shall be deemed amended by modifying
such provision to the extent necessary to render it valid,
legal and enforceable while preserving its intent or, if
such modification is not possible, by substituting therefor
another provision that is legal and enforceable and that
achieves the same objective.
(e) The observance of any term of this Agreement may
be waived (either generally or in a particular instances and
either retroactively or prospectively) by the party entitled
to enforce such term, but such waiver shall be effective
only if it is in writing signed by the party against which
such waiver is to be asserted. Unless otherwise expressly
provided in this Agreement, no delay or omission on the part
of any party in exercising any right or privilege under this
Agreement shall operate as a waiver thereof, nor shall any
waiver on the part of any party of any right or privilege
under this Agreement operate as a waiver of any other right
or privilege under this Agreement nor shall any single or
partial exercise of any right or privilege preclude any
other or further exercise thereof or the exercise of any
other right or privilege under this Agreement.
(f) Neither party shall be liable for any loss or
delay resulting from any force majeure event, including,
without limitation, acts of God, fire, natural disaster,
labor stoppage, war or military hostilities, civil unrest,
or inability of carriers to make scheduled deliveries, and
any affected time period shall be extended to the extent of
any delay resulting from any force majeure event.
(g) The respective rights and obligations of the
parties hereunder shall indefinitely survive the termination
of this Agreement to the extent necessary to the intended
preservation of such rights and obligations or survival of
only specific provisions (e.g., reversion of rights on
expiration or termination).
(h) The parties agree that this Agreement shall be
governed by and construed and interpreted in accordance with
the substantive laws of the State of Delaware, without
giving effect to principles relating to conflict of laws.
(i) Nothing in this Agreement is intended to require
Unigraphics or Intergraph to violate the proprietary or
intellectual property rights of any third party Person.
(j) Unigraphics and Intergraph each agree to execute
and deliver such further instruments and documents, and take
such further actions, as may be reasonably requested by the
other party in order to evidence more fully the transactions
contemplated by this Agreement, provided that such further
instruments and actions shall not, unless otherwise agreed,
require either party to incur any obligation in addition to
the obligations undertaken or assumed elsewhere in this
Agreement or in the Asset Purchase Agreement.
(k) Nothing in this Agreement is intended or shall be
construed to give any Person, other than the parties hereto,
any legal claim or equitable right, remedy, or claim under
or with respect to this Agreement or any provision contained
herein. The provisions set forth in this Agreement are for
the sole benefit of Intergraph and Unigraphics.
(l) Any notices or other communications required or
permitted to be given hereunder shall be given in accordance
with Section 10.6 of the Asset Purchase Agreement, which
Section 10.6 is incorporated by reference herein, as though
set forth in full herein.
3.2 Taxes. The provisions of Sections 3.13 and 10.13
of the Asset Purchase Agreement relating to tax
representations and warranties and tax matters,
respectively, and all defined terms utilized therein, are
incorporated by reference herein. For purposes of this
Agreement, (a) each reference to Acquired Assets set forth
in Section 10.13 of the Asset Purchase Agreement shall also
be deemed to include a reference to the licensed Trademarks
and (b) each reference to Alabama Transaction Taxes, Italian
three percent (3%) registration Tax, Other Transaction
Taxes, and Transaction Taxes in Section 10.13 of the Asset
Purchase Agreement shall be deemed to include all such
Transaction Taxes arising out of the grant of the license
with respect to the Trademarks pursuant to this Agreement.
REMAINDER OF PAGE LEFT INTENTIONALLY BLANK
IN WITNESS WHEREOF, Unigraphics and Intergraph have
each caused this Agreement to be signed and delivered by its
duly authorized officer, all as of the date first set forth
above.
INTERGRAPH CORPORATION,
a Delaware corporation
By: /s/ John W. Wilhoite
--------------------
John W. Wilhoite, Vice President
UNIGRAPHICS SOLUTIONS INC.,
a Delaware corporation
By: /s/ H. Timothy Hatfield
-----------------------
H. Timothy Hatfield, Vice President
EXHIBIT 1 to EXHIBIT P OF THE
ASSET PURCHASE AGREEMENT
------------------------
("Unigraphics EMS/Solid Edge Products
and Services Trademark License Agreement")
The following Trademarks have been granted, or are in the process
of being granted, by the Untied States Patent and Trademarks Office:
REGISTRATION DATE OF
NUMBER REGISTRATION
TRADEMARKS (Serial Number) (or Registration App.)
- ---------- --------------- ----------------------
SMARTSKETCH 1,925,277 October 10, 1995
CLIX 1,458,158 September 22, 1987
RIS 1,700,239 July 14, 1992
The following Trademarks are owned at common law:
TRADEMARKS
PinPoint Solid Edge
PickQuick Solid Edge
PATENT LICENSE AGREEMENT
THIS AGREEMENT (this "Agreement"), dated as of March 2,
1998 (the "Effective Date"), by and between Intergraph
Corporation, a Delaware corporation having its principal
place of business at One Madison Industrial Park,
Huntsville, Alabama 35894 ("Intergraph"), and Unigraphics
Solutions Inc., a Delaware corporation having its principal
place of business at 13736 Riverport Drive, Maryland
Heights, Missouri 63043 ("Unigraphics").
WHEREAS, contemporaneously herewith, Intergraph and
Unigraphics and certain of their respective affiliates have
executed and delivered that certain Asset Purchase Agreement
dated March 2, 1998 (the "Asset Purchase Agreement") with
respect to the sale, transfer, or license by Intergraph to
Unigraphics of certain assets;
WHEREAS, Intergraph has the right to license others under
certain patents and patent applications; and
WHEREAS, Unigraphics desires to acquire a non-exclusive
license under those patents and patent applications.
NOW, THEREFORE, in consideration of the premises and
mutual covenants herein contained, Intergraph and
Unigraphics agree as follows:
Section 1. Definitions
Capitalized terms used in this Agreement shall have the
meanings provided in the Asset Purchase Agreement, except
the capitalized terms listed below which shall have the
following meanings:
1.1 "Intergraph Exclusive Field" means:
(i) three-dimensional products without significant
capability for use as a three-dimensional mechanical
system, for data capture, design, analysis and
management of infrastructure systems. Intergraph's
highway design, utility distribution system, and
mapping products are examples of such systems; and
(ii) three-dimensional products without significant
capability for use as a three-dimensional mechanical
system, for modeling, designing (including design of
component parts), analyzing, drawing production, or
operation of any of the following systems which are
utilized in chemical and processing industry plants,
ships, marine vessels, or off-shore platforms,
including, without limitation, (1) piping, (2) heating,
ventilation and air conditioning (HVAC), (3) cable
routing, (4) structural support systems for marine
vessels, ships, and off-shore platforms, and (5)
process and/or instrument diagrams. Intergraph's plant
design and shipbuilding products are examples of such
systems; and
(iii) performance of the CAD-2 Contract for the U.S.
Government.
1.2 "Joint Licensed Field" means:
(i) two-dimensional drafting systems, including those
having application to the mechanical drafting market;
(ii) two-dimensional modeling systems, including those
having application to the mechanical drafting market;
(iii) creation, publication, or distribution of
technical manuals;
(iv) electrical CAD, CAM, or CAE systems (or
combinations thereof) without significant capability
for use as a three-dimensional mechanical systems; and
(v) all other CAD, CAM, or CAE systems (or
combinations thereof) not within the Intergraph
Exclusive Field.
1.3 "Licensed Patents" means all patents, utility models,
and applications therefor, listed in Exhibit 1 hereto,
together with all continuations, continuations-in-part,
reissues, extensions, reexamination certificates,
revivals, or renewals thereof, and all worldwide
counterparts of those patents (including, without
limitation, certificates of invention, utility models,
and other patent equivalents).
Licensed Patents shall also include any patent or
patent application (and all varieties thereof listed
above) for any invention used in the Business with the
Acquired Assets, that was conceived or reduced to
practice prior to the Effective Date, and which has a
priority date earlier than March 2, 2000. For such
patents or patent applications, Unigraphics shall have
the burden to prove that the invention was used in the
Business with the Acquired Assets.
1.4 "Licensed Products" means computer software products.
1.5 "Unigraphics Licensed Field" means three-dimensional
mechanical CAD, CAM, or CAE systems (or combinations
thereof) without significant capability for use as a
three-dimensional plant, offshore platform, ship, or
submarine design system. Intergraph's EMS and Solid
Edge products are examples of such systems.
Section 2. License and Release
2.1 Until March 3, 2005, Intergraph grants to
Unigraphics a worldwide, royalty-free, nonexclusive,
transferable (to the extent permitted by Section 8
hereof) license under the Licensed Patents, only in
the Unigraphics Licensed Field and in the Joint
Licensed Field, but not in the Intergraph Exclusive
Field:
(a) to make, use, lease, sell, offer to
sell, import, export, and otherwise
transfer Licensed Products, and to
practice any method or process involved
in the manufacture or use thereof, and
(b) to have made Licensed Products by
another manufacturer for the use,
lease, sale, offer for sale, import,
export or other transfer by
Unigraphics, only when the resulting
products are sold exclusively under
Unigraphics' trade names or trademarks
or those of its permitted transferee.
Nothing herein shall be construed as
granting Unigraphics a license to have
made where the resulting products are
sold by other parties under trade names
or trademarks owned by a party other
than Unigraphics or its permitted
transferee.
2.2 Effective March 3, 2005, Intergraph grants to
Unigraphics a worldwide, nonexclusive, transferable
(to the extent permitted by Section 8 hereof) license
under the Licensed Patents to make, have made, use,
lease, sell, offer to sell, import, export, and
otherwise transfer any products, and to practice any
method or process covered by the Licensed Patents,
whether or not within the Unigraphics Licensed Field,
Intergraph Exclusive Field or Joint Licensed Field.
2.3 No license is granted by Intergraph either
directly or by implication, estoppel, or otherwise to
any intellectual property other than under the
Licensed Patents and for the Licensed Products.
2.4 Intergraph agrees not to sue Unigraphics for
infringement of any patent (or foreign equivalent) for
making, using, selling, or offering for sale any of
the Licensed Products which are described by one or
more claims of one or more Licensed Patents.
2.5. Neither party nor any of its Affiliates shall be
required hereunder to file any patent application, or
to secure any patent or patent rights, or to maintain
any patent in force, or to provide copies of patent
applications to the other party or its Affiliates, or
to disclose any inventions described or claimed in
such patent applications.
2.6 Intergraph shall not have any obligation
hereunder to institute any action or suit against
third parties for infringement of any Licensed
Patents or to defend any action or suit brought by a
third party which challenges or concerns the validity
of any Licensed Patents. Unigraphics shall not have
any right to institute any action or suit against
third parties for infringement of any Licensed
Patents.
Section 3. Sublicenses
3.1 The license granted herein includes the right of
Unigraphics to sublicense its Affiliates and the right
of such sublicensed Affiliates to sublicense other
Affiliates of Unigraphics. Each Affiliate so
sublicensed shall be bound by the terms and conditions
of this Agreement as if it were named herein in the
place of Unigraphics. Any sublicense granted to an
Affiliate shall terminate on the date such Affiliate
ceases to be an Affiliate.
Section 4. Reports
4.1 Unigraphics agrees to provide to Intergraph,
within thirty days of the granting thereof, a copy of
each sublicense granted hereunder.
4.2 The provisions of Section 10.13 of the Asset
Purchase Agreement relating to tax representations
and warranties and tax matters, respectively, and all
defined terms utilized therein, are incorporated by
reference herein. For purposes of this Agreement,
(a) each reference to Acquired Assets set forth in
Section 10.13 of the Asset Purchase Agreement shall
also be deemed to include a reference to the Licensed
Patents, and (b) each reference to Alabama
Transaction Taxes, Italian Transaction Taxes, Other
Transaction Taxes, and Transaction Taxes in Section
10.13 of the Asset Purchase Agreement shall be deemed
to include all such Transaction Taxes arising out of
the grant of the license with respect to the Licensed
Patents pursuant to this Agreement.
Section 5. Term of Agreement; Termination
5.1 The term of this Agreement shall be from the date
hereof until the expiration of the last to expire of
the patents licensed hereunder.
Section 6. Warranty
6.1 Intergraph represents and warrants that it has
the full right and power to grant the license herein,
and that there are no outstanding agreements
(including but not limited to agreements creating any
security interests), assignments, or encumbrances
inconsistent with the provisions of this Agreement.
By this Agreement Intergraph makes no other
representations or warranties, express or implied, nor
does Intergraph assume any liability in respect of any
infringement of patents or other rights of third
parties due to Unigraphics' operation under the
license herein granted. Notwithstanding the
foregoing, nothing herein is intended to diminish any
representation or warranty set forth in the Asset
Purchase Agreement and in the event of a conflict
between this Agreement and the Asset Purchase
Agreement, the Asset Purchase Agreement controls.
Section 7. Communications
7.1 Any notices or other communications required or
permitted to be given hereunder shall be given in
accordance with Section 10.6 of the Asset Purchase
Agreement, which Section 10.6 is incorporated by
reference herein as though set forth in full herein
Section 8. Assignments
8.1 The rights and obligations of Unigraphics under
this Agreement may be transferred (either by operation
of law or otherwise), assigned or sublicensed only as
follows:
(a) Unigraphics may grant to one or more lenders a
pledge, security interest, mortgage, lien, conditional
assignment or other similar interest in its respective
rights under this Agreement in connection with any
financing transaction undertaken in the ordinary
course of such party's business; provided, however,
that any lender, or transferee, assignee, or
sublicensee of such lender following foreclosure or
realization on the collateral by any such lender,
shall meet the requirements of Section 8.1(b) hereof;
or
(b) Unigraphics may transfer, assign or sublicense
(to the extent permitted by Section 3 hereof) all or a
part of its rights and obligations under this
Agreement to any person or entity that agrees in
writing to be bound by all terms, conditions and
restrictions substantially equivalent to those
contained in this Agreement; provided, however, that
any such transfer, assignment or sublicense shall not
relieve Unigraphics of its obligations and
responsibilities under this Agreement.
Section 9. Maintenance of Patents
9.1 For any Licensed Patent, Intergraph may at its
sole option, determine whether or not to pay
maintenance fees (or foreign equivalents such as
annuities or taxes) required to keep such Licensed
Patents enforceable.
Section 10. Miscellaneous
11.1(a) This Agreement sets forth the entire agreement
and understanding between the parties as to the
subject matter hereof and merges all prior discussions
between them, and neither of the parties shall be
bound by any conditions, definitions, warranties,
understandings, or representations with respect to
such subject matter other than as expressly provided
herein or as set forth in that certain Asset Purchase
Agreement or as set forth on or after the date hereof
in a writing signed by a duly authorized
representative of each party intending to be bound
thereby.
(b) The headings found in this Agreement are for
reference purposes only and are to be given no effect
in the construction of this Agreement.
(c) This Agreement may be executed in one or more
counterparts, each of which shall be an original, but
all of which shall, together, constitute one and the
same instrument.
(d) If any provision of this Agreement or the
application of any such provision to any Person or
circumstance, shall be declared judicially to be
invalid, unenforceable or void, such decision shall
not have the effect of invalidating or voiding the
remainder of this Agreement, it being the intent and
agreement of the parties that this Agreement shall be
deemed amended by modifying such provision to the
extent necessary to render it valid, legal and
enforceable while preserving its intent or, if such
modification is not possible, by substituting therefor
another provision that is legal and enforceable and
that achieves the same objective.
(e) The observance of any term of this Agreement may
be waived (either generally or in a particular
instances and either retroactively or prospectively)
by the party entitled to enforce such term, but such
waiver shall be effective only if it is in writing
signed by the party against which such waiver is to be
asserted. Unless otherwise expressly provided in this
Agreement, no delay or omission on the part of any
party in exercising any right or privilege under this
Agreement shall operate as a waiver thereof, nor shall
any waiver on the part of any party of any right or
privilege under this Agreement operate as a waiver of
any other right or privilege under this Agreement nor
shall any single or partial exercise of any right or
privilege preclude any other or further exercise
thereof or the exercise of any other right or
privilege under this Agreement.
(f) Neither party shall be liable for any loss or
delay resulting from any force majeure event,
including, without limitation, acts of God, fire,
natural disaster, labor stoppage, war or military
hostilities, civil unrest, or inability of carriers to
make scheduled deliveries, and any affected time
period shall be extended to the extent of any delay
resulting from any force majeure event.
(g) The respective rights and obligations of the
parties hereunder shall indefinitely survive the
termination of this Agreement to the extent necessary
to the intended preservation of such rights and
obligations or survival of only specific provisions
(e.g., confidentiality).
(h) The parties agree that this Agreement shall be
governed by and construed and interpreted in
accordance with the substantive laws of the State of
Delaware, without giving effect to principles relating
to conflict of laws.
(i) Nothing in this Agreement is intended to require
Intergraph or Unigraphics to violate the proprietary
or intellectual property rights of any third party
Person.
(j) Intergraph and Unigraphics each agree to execute
and deliver such further instruments and documents,
and take such further actions, as may be reasonably
requested by the other party in order to evidence more
fully the transactions contemplated by this Agreement,
provided that such further instruments and actions
shall not, unless otherwise agreed, require either
party to incur any obligation in addition to the
obligations undertaken or assumed elsewhere in this
Agreement or in the Asset Purchase Agreement.
(k) Nothing in this Agreement is intended or shall be
construed to give any Person, other than the parties
hereto, any legal claim or equitable right, remedy, or
claim under or with respect to this Agreement or any
provision contained herein. The provisions set forth
in this Agreement are for the sole benefit of
Unigraphics and Intergraph.
IN WITNESS WHEREOF, the parties have caused this
Agreement to be duly signed and with effect from the date
first above written.
INTERGRAPH CORPORATION,
a Delaware corporation
By: /s/ John W. Wilhoite
--------------------
John W. Wilhoite, Vice President
UNIGRAPHICS SOLUTIONS INC.,
a Delaware corporation
By: /s/ H. Timothy Hatfield
-----------------------
H. Timothy Hatfield, Vice President
Exhibit 1
Licensed Patents and Applications
Issued Patents
Patent Title Date of Issue
- ------ ----- -------------
5,682,468 OLE for Design and Modeling 10/28/97
5,892,184 Object Relationship Management System 11/25/97
Pending Patent Applications
Serial No. Title Filing Date
- ---------- ----- -----------
08/438,048 Visible Line Processor 5/8/95
08/509,847 System for Adding Attributes to an Object 8/1/95
at Run Time in an Object Oriented Computer
08/552,812 Method for Object Oriented Program 11/3/95
Using Dynamic interfaces
08/573,689 Cursor Positioning Method 12/18/95
08/435,348 Method and Apparatus for Dynamically 5/5/95
Interpreting Drawing Commands
08/435.647 Intelligent Object Selection 5/5/95
08/855,775 OLE for Design and Modeling 5/12/95
Dynamic Interfaces
COPYRIGHT ASSIGNMENT
WHEREAS, INTERGRAPH CORPORATION, a Delaware corporation,
having its principal place of business at One Madison Industrial
Park, Huntsville, Alabama 35894 (hereinafter "Assignor"), has
created and developed certain works that are used exclusively in
the Business (as defined below), which Works are described in the
registrations on Exhibit A registered in the United States
Copyright Office, (hereinafter the "Works"), and is the owner of
all right, title and interest in and to the Works; and
WHEREAS, UNIGRAPHICS SOLUTIONS INC., a Delaware corporation,
having its principal place of business at 13736 Riverport Drive,
Maryland Heights, Missouri 63043 (hereinafter "Assignee"), is
desirous of acquiring all the right, title and interest in and to
said Works; and
WHEREAS, as used herein, "Business" means the three-
dimensional mechanical CAD/CAM/CAE business conducted by Assignor
and its direct and indirect subsidiaries (and/or a branch of
Assignor or any such subsidiary) through the Solid Edge and EMS
product lines and which include, without limitation the software
and related maintenance businesses for the Solid Edge, EMS,
Technovision and ProRen products, and the provision of systems
integration, consulting and training services relating to such
software.
NOW THEREFORE, for good and valuable consideration, the
receipt and sufficiency of which is hereby acknowledged, Assignor
does hereby assign and transfer to Assignee, its successors,
assigns and legal representatives, for the territory of the
United States of America and throughout the world, the entire
right, title and interest in and to all copyrights in the Works,
and any prior versions of the Works, as well as any registrations
issued therefore, and including the right to sue for past
infringement, the same to be held and enjoyed by the said
Assignee for its own use and benefit and for its successors,
assigns and legal representatives, as fully and entirely as the
same would have been held by Assignor had this assignment and
sale not been made, effective as of March 2, 1998.
IN WITNESS WHEREOF, the Assignor has caused its duly
authorized representative to execute this Copyright Assignment on
the date and in the capacity shown below.
INTERGRAPH CORPORATION
Date: March 2, 1998 By: /s/ John W. Wilhoite
________________________________
Name: John W. Wilhoite
Title: Vice President
STATE OF TEXAS )
)
COUNTY OF COLLIN )
On this 2nd day of March, 1998, personally appeared before
me John W. Wilhoite, to me known and known to me to be the Vice
President of Intergraph Corporation, the Assignor above named,
and acknowledged that he executed the foregoing assignment on
behalf of said Assignor and pursuant to authority duly received.
/s/ Julie M. Stepan
____________________________________________
Notary Public in and for the State of Texas
Julie M. Stepan
____________________________________________
Printed Notary Name
My Commission Expires: 1/28/01
______________________
TRADEMARK ASSIGNMENT
WHEREAS, INTERGRAPH CORPORATION, a Delaware corporation, having
its principal place of business at One Madison Industrial Park,
Huntsville, Alabama 35894 (hereinafter "Assignor"), adopted and
used certain trademarks used exclusively in connection with the
Business (as defined below), including but not limited to the
trademarks listed on Exhibit A, and is the owner of all right, title
and interest in and to certain trademark applications and
registrations relating exclusively to the Business, which trademark
applications and registrations are listed in Exhibit A, attached
hereto and incorporated by reference herein; and
WHEREAS, UNIGRAPHICS SOLUTIONS INC., a Delaware corporation,
having its principal place of business at 13736 Riverport Drive,
Maryland Heights, Missouri 63043 (hereinafter "Assignee"), desires to
acquire all right, title and interest in and to such trademarks and in
and to the associated applications for registration and trademark
registrations relating thereto; and
WHEREAS, as used herein, "Business" means the three-dimensional
mechanical CAD/CAM/CAE business conducted by Assignor and its direct
and indirect subsidiaries (and/or a branch of Assignor or any such
subsidiary) through the Solid Edge and EMS product lines and which
include, without limitation the software and related maintenance
businesses for the Solid Edge, EMS, Technovision and ProRen products,
and the provision of systems integration, consulting and training
services relating to such software.
NOW THEREFORE, for good and valuable consideration, the receipt
and sufficiency of which is hereby acknowledged, Assignor does hereby
grant, assign and set over to assignee, its successors, assigns and
legal representatives, the entire right, title and interest in and to
the trademark applications and registrations relating exclusively to
the Business, which trademark applications and registrations are
listed in Exhibit A hereto, together with the goodwill of the business
symbolized by such marks.
Assignor also assigns to Assignee all claims for damages by
reason of past infringement of such trademarks, with the right to sue
for and collect the same for its own use and benefit, and for the use
and benefit of its successors, assigns and other legal
representatives.
The foregoing assignment is made effective as of March 2, 1998.
IN WITNESS WHEREOF, the Assignor has caused its duly authorized
representative to execute this Trademark Assignment on the date and in
the capacity shown below.
INTERGRAPH CORPORATION
Date: March 2, 1998 By: /s/ John W. Wilhoite
_________________________________
Name: John W. Wilhoite
Title: Vice President
STATE OF TEXAS )
)
COUNTY OF COLLIN )
On this 2nd day of March, 1998, personally appeared before me
John W. Wilhoite, to me known and known to me to be the Vice President
of Intergraph Corporation, the Assignor above named, and acknowledged
that he executed the foregoing assignment on behalf of said Assignor
and pursuant to authority duly received.
/s/ Julie M. Stepan
____________________________________________
Notary Public in and for the State of Texas
Julie M. Stepan
____________________________________________
Printed Notary Name
My Commission Expires: 1/28/2001
----------------------
EXHIBIT A
TO
TRADEMARK ASSIGNMENT
--------------------
REGISTRATION DATE OF
NUMBER REGISTRATION
TRADEMARKS (Serial Number) (or Registration App.)
- ---------- --------------- ----------------------
SOLID EDGE Serial Number 74/721,439 August 26, 1997
SOLID EDGE EXCHANGE Serial Number 74/131,517 August 19, 1997
EMS POWERPAK Reg. No. 1,846,558 July 26, 1994
Unigraphics Solutions Inc.
13736 Riverport Drive
Maryland Heights, Missouri 63043
March 2, 1998
Intergraph Corporation
Huntsville, Alabama 35894-0001
Gentlemen:
Reference is made to the Asset Purchase Agreement dated as
of the date hereof (the "Asset Purchase Agreement") by and
among Intergraph Corporation ("Intergraph"), the other
Selling Entities identified therein, Unigraphics Solutions
Inc. ("Unigraphics") and the other Acquiring Entities
identified therein. In connection with the consummation of
the transactions contemplated by the Asset Purchase
Agreement, Unigraphics agrees that, during the period
commencing on the date hereof and ending on the later of (i)
March 2, 2000 or (ii) the end of the term of the Lease
Agreement (as defined in the Purchase Agreement), neither it
nor any of its subsidiaries will, directly or indirectly,
solicit to employ any of Intergraph's Huntsville, Alabama or
Paris, France Development Center based software development
personnel or development managers who are a part of
Intergraph's Jupiter technology development effort (i.e.,
the Solid Edge Common Code, as such term is defined in the
Asset Purchase Agreement) or the extended Solid Edge Common
Code capability development effort, without the prior
written consent of Intergraph.
Yours very truly,
UNIGRAPHICS SOLUTIONS INC.
By:/s/ H. Timothy Hatfield
-----------------------
Name: H. Timothy Hatfield
Title: Vice President
Solid Edge/EMS Product Line of
Intergraph Corporation
Statements of Revenues and Direct Expenses
Years ended December 31, 1997, 1996, and 1995
with Report of Independent Auditors
Solid Edge/EMS Product Line of
Intergraph Corporation
Statements of Revenues and Direct Expenses
Years ended December 31, 1997, 1996, and 1995
Contents
Report of Independent Auditors 1
Statements of Revenues and Direct Expenses 2
Report of Ernst & Young LLP, Independent Auditors
Board of Directors and Stockholders
Intergraph Corporation
We have audited the accompanying statements of revenues and
direct expenses of the SolidEdge/EMS Product Line of
Intergraph Corporation (the Product Line) for the years
ended December 31, 1997, 1996 and 1995. These statements
are the responsibility of the Product Line's management.
Our responsibility is to express an opinion on the
statements based on our audits.
We conducted our audits in accordance with generally
accepted auditing standards. Those standards require that
we plan and perform the audit to obtain reasonable assurance
about whether the statements are free of material
misstatement. An audit includes examining, on a test basis,
evidence supporting the amounts and disclosures in the
statements. An audit also includes assessing the basis of
accounting used and significant estimates made by
management, as well as evaluating the overall presentation
of the statements. We believe that our audits provide a
reasonable basis for our opinion.
The Product Line consists of products and services offered
by various subsidiaries and divisions of Intergraph
Corporation and as such does not constitute a separate legal
entity. Accordingly, the statements of revenues and direct
expenses of the Product Line have been carved out from the
consolidated statements of operations of Intergraph
Corporation. Management believes the assumptions underlying
the statements of revenues and direct expenses of the
Product Line to be reasonable.
The accompanying statements were prepared to present the
revenues and direct expenses of the Product Line pursuant to
the asset purchase agreement between Intergraph Corporation
and Unigraphics Solutions, Inc. expected to be dated March
2, 1998 and are not intended to be a complete presentation
of the Product Line's results of operations. The statements
include allocations of certain common expenses on bases
determined by management of Intergraph Corporation.
Management has not included disclosures required by
generally accepted accounting principles. These omitted
disclosures include, but are not limited to, disclosures
regarding: allocation of certain common expenses between the
Solid Edge/EMS Product Line of Intergraph Corporation and
the remaining operations of Intergraph Corporation,
significant accounting policies, employee benefit plans,
operations by geographic area, related party transactions,
and commitments and contingencies.
In our opinion, except for the omission of information
described in the preceding paragraph, the statements
referred to above present fairly, in all material respects,
the revenues and direct expenses for the SolidEdge/EMS
Product Line of Intergraph Corporation for the years ended
December 31, 1997, 1996 and 1995.
/s/ Ernst & Young LLP
February 28, 1998
For the years ended December 31,
1997 1996 1995
------------------------------------------
Software revenues and services $ 35,218 $ 31,880 $ 34,511
Direct expenses:
Cost of sales 3,979 4,436 5,976
Research and Development 9,951 10,936 12,119
Sales, general, and administrative 25,404 26,630 22,743
------------------------------------------
Total costs and direct expenses 39,334 42,002 40,838
------------------------------------------
Excess of direct expenses
over revenues $ (4,116) $ (10,122) $ (6,327)
------------------------------------------
------------------------------------------
Foothill.
March 2, 1998
Intergraph Corporation
Huntsville, Alabama 35894-0001
Attention: John W. Wilhoite
Re: Letter Agreement dated as of March 2, 1998 between Foothill
Capital Corporation ("Foothill") and Intergraph Corporation
("Intergraph") regarding the Mechanical Business Disposition
(the "Foothill Consent")
Gentlemen:
This letter will serve as written notification pursuant to paragraph 3
of the Foothill Consent that all required Participant consents to the
Foothill Consent have been obtained. The Foothill Consent is hereby
effective and the documents held by Balch & Bingham L.L.P. may be deemed
delivered and effective.
Yours very truly,
FOOTHILL CAPITAL CORPORATION
By: /s/Victor D. Barwig
----------------------------------
Victor D. Barwig, Vice President
PARTIAL RELEASE OF COPYRIGHTS
This Partial Release of Copyrights dated as of March 2, 1998
(this "Release") is made by Foothill Capital Corporation, acting
in its capacity as secured party (in such capacity, the "Secured
Party"), in favor of Intergraph Corporation (the "Debtor").
WITNESSETH
WHEREAS, pursuant to a Copyright Security Agreement recorded
in the records of the United States Copyright Office on January
17, 1997 beginning at Volume 3325, Page 61-80 from the Debtor in
favor of Secured Party, the Debtor granted to Secured Party,
among other things, a continuing security interest in certain
Copyrights set forth on Schedule 1 hereto (the "Subject
Copyrights");
WHEREAS, the Secured Party wishes to release all of its
interest in the Subject Copyrights in the records of the United
States Copyright Office;
NOW, THEREFORE, for good and valuable consideration, the
receipt and sufficiency of which is hereby acknowledged, the
Secured Party does hereby release, without recourse,
representation or warranty, its security interest in, to or under
all of the Subject Copyrights and any right, title and interest
of the Secured Party in, to and under the Subject Copyrights
shall hereby cease and become void.
Secured Party shall execute any further documents as may be
reasonably requested by Debtor in order to fully effectuate the
release of its security interest in the Subject Copyrights.
This Release shall be governed in all respects by the laws
of the State of California, without giving effect to the conflict
of laws rules thereof.
IN WITNESS WHEREOF, the Secured Party has caused this
Release to be duly executed and delivered by its officer
thereunto duly authorized as of March 2, 1998.
INTERGRAPH CORPORATION FOOTHILL CAPITAL CORPORATION
as Debtor as Secured Party
By: /s/ John W. Wilhoite By: /s/ Victor D. Barwig
------------------------- -------------------------
Name: John W. Wilhoite Name: Victor D. Barwig
------------------ ------------------
Title: Vice President Title: Vice President
----------------- -----------------
PARTIAL RELEASE OF TRADEMARKS
This Partial Release of Trademarks dated as of March 2, 1998
(this "Release") is made by Foothill Capital Corporation, acting
in its capacity as secured party (in such capacity, the "Secured
Party"), in favor of Intergraph Corporation (the "Debtor").
WITNESSETH
WHEREAS, pursuant to a Trademark Security Agreement recorded
in the records of the United States Patent and Trademark Office
on January 21, 1997 beginning at Reel 1527, Frame 0558 from the
Debtor in favor of Secured Party, the Debtor granted to Secured
Party, among other things, a continuing security interest in
certain Trademarks set forth on Schedule 1 hereto (the "Subject
Trademarks");
WHEREAS, the Secured Party wishes to release all of its
interest in the Subject Trademarks in the records of the United
States Patent and Trademark Office;
NOW, THEREFORE, for good and valuable consideration, the
receipt and sufficiency of which is hereby acknowledged, the
Secured Party does hereby release, without recourse,
representation or warranty, its security interest in, to or under
all of the Subject Trademarks, together with the goodwill of the
business symbolized thereby, and any right, title and interest of
the Secured Party in, to and under the Subject Trademarks shall
hereby cease and become void.
Secured Party shall execute any further documents as may be
reasonably requested by Debtor in order to fully effectuate the
release of its security interest in the Subject Trademarks.
This Release shall be governed in all respects by the laws
of the State of California, without giving effect to the conflict
of laws rules thereof.
IN WITNESS WHEREOF, the Secured Party has caused this
Release to be duly executed and delivered by its officer
thereunto duly authorized as of March 2, 1998.
INTERGRAPH CORPORATION FOOTHILL CAPITAL CORPORATION
as Debtor as Secured Party
By: /S/ John W. Wilhoite By: /s/ Victor D. Barwig
------------------------ ------------------------
Name: John W. Wilhoite Name: Victor D. Barwig
------------------ ------------------
Title: Vice President Title: Vice President
----------------- -----------------
