ASA INTERNATIONAL LTD.
10 Speen Street
Framingham, Massachusetts 01701
(508) 626-2727
January 28, 1998
Securities and Exchange Commission
450 5th Street, N.W.
Judiciary Plaza
Washington, D.C. 20549
Attention: Filing Desk
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RE: ASA INTERNATIONAL LTD.
SEC FILE NO. 0-14741
Pursuant to regulations of the Securities and Exchange Commission,
submitted herewith for filing on behalf of ASA International Ltd. (the
"Company") is the Company's Form 8-K dated January 28, 1998. Please note that
two Asset Purchase Agreements, the schedules to which have been omitted, are
being filed as exhibits to this report. Upon request, these schedules will be
furnished supplementally to you.
This filing is being effected by direct transmission to the Commission's
Operational EDGAR System.
Very truly yours,
ASA INTERNATIONAL LTD.
/s/ Terrence C. McCarthy
Terrence C. McCarthy
Vice President and Treasurer
TCM/mb
<PAGE>
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: January 28, 1998
ASA International Ltd.
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(Exact name of Registrant as specified in its Charter)
Delaware O-14741 02-0398205
- ---------------------------- ------------ ----------------------
(State or Other Jurisdiction (Commission (I.R.S. Employer
of Incorporation) File Number) Identification Number)
10 Speen Street, Framingham, MA 01701
- ---------------------------------------- -----------------------
(Address of Principal Executive Offices) (Zip Code)
Registrant's Telephone Number, including Area Code: 508-626-2727
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<PAGE>
TABLE OF CONTENTS
FORM 8-K
January 28, 1998
Item Page
- ---- ----
Item 2. Acquisition or Disposition of Assets - with 1
Cedes S.r.l. and its wholly owned subsidiary
Sipi-U S.r.l (Group Cedes)
Item 7. Financial Statement and Exhibits 1
Signature 2
Exhibits E-1
E-2
E-3
E-4-1
E-4-2
<PAGE>
Item 2. Acquisition or Disposition of Assets
On January 13, 1998, ASA International Ltd. (the "Company") and its wholly
owned Italian subsidiary (Cedes Associates S.r.l.) acquired substantially all of
the assets of Cedes S.r.l. and SIPI-U S.r.l. ("Cedes"), subsidiaries of the
Findest Group of Padova, Italy. Cedes sells enterprise resource planning
software to mid-range companies in Italy. No material relationship exists
between Cedes and the Company or any of their respective affiliates, officers,
or directors.
The transaction involved an exchange of approximately $30,000 US in cash,
assumption of certain liabilities, and 200,000 shares of the Company's Common
Stock, $.01 par value, for the assets of Cedes. The cash portion of the
consideration was paid from the Company's working capital. Cedes had revenues of
approximately $3.6 Million for the year ended December 31, 1997.
Item 7. Financial Statements, Pro Forma Financial Information and
Exhibits
The financial statements and pro forma financial information required
by this item will be filed by amendment within sixty days of the date
of this report.
Exhibit No. Title
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E-1 Agreement for the Purchase and Sale of Assets
on an Ongoing Basis by and between Cedes
S.r.l. and ASA International Ltd.
E-2 Agreement for the Purchase and Sale of Assets
on an Ongoing Basis by and between
SIPI-U S.r.l. and ASA International Ltd.
E-3 Addendum to the Agreement for the Purchase and
Sale of Assets on an Ongoing Basis by and
between ASA International Ltd. and
Cedes S.r.l. and SIPI-U S.r.l.
E-4-1 Additional Agreements related to the above.
E-4-2 Additional Agreements related to the above.
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities and Exchange Act of 1934,
the Registrant has duly caused this report to be signed on its behalf by the
undersigned hereunto duly authorized.
ASA International Ltd.
/s/ Terrence C. McCarthy
------------------------------
Terrence C. McCarthy
Vice President and Treasurer
Date: January 28, 1998
EXHIBIT E-1
Padova, December 18 1997
Messrs.
ASA International Ltd.
10, Speen Street
Framingham
Massachusetts 01701
USA
Dear Sirs,
Reference is made to your letter dated December 15, 1997 which is hereinbelow
fully transcribed for acceptance.
QUOTE
Framingham, December 15 1997
Messrs.
CEDES S.r.l.
Viale dell'Industria 32
35129 PADOVA
Dear Sirs,
Further to the discussions held in the last months we hereby set forth the terms
and conditions of the prospected transfer of business on an ongoing concern
basis to be executed from our company to your company.
AGREEMENT FOR THE PURCHASE AND SALE OF ASSETS
ON AN ON GOING CONCERN BASIS
(CONTRATTO DI CESSIONE DI AZIENDA)
By and between
CEDES S.r.l., a limited liability company duly incorporated under the laws of
Italy, with its registered office at Padova, Viale dell'Industria 32
and
ASA International Ltd., a company duly incorporated under the laws of the State
of Massachusetts (U.S.), with its registered office at Framingham 10, Speen
Street
WITNESSETH:
- - WHEREAS Cedes S.r.l. is an Italian company active and engaged in the
fields of the creation, marketing and supply of software programs and
of the performance of services of installation and maintenance of
such programs; and
- - WHEREAS ASA International Ltd. is a US corporation active and engaged
in the field of the creation, manufacturing and supply of software
programs; and
- - WHEREAS ASA International Ltd. is going to incorporate or purchase on
or before December 31, 1997 in Italy a wholly owned subsidiary
("ASA Italy"); and
- - WHEREAS ASA International Ltd. (through its wholly owned subsidiary
ASA Italy) desires to purchase from Cedes S.r.l., and Cedes S.r.l.
Desires to sell to ASA Italy, the business of Cedes S.r.l. relevant
to the creation, marketing and supply of software programs and to the
performance of services of installation and maintenance of such
programs, in accordance with the terms and conditions provided for
under this agreement.
IT IS HEREBY AGREED AS FOLLOWS:
TABLE OF CONTENTS
ARTICLE 1. DEFINITIONS
ARTICLE 2. SALE AND PURCHASE OF THE BUSINESS
ARTICLE 3. PURCHASE PRICE AND PAYMENTS
ARTICLE 4. SPECIAL PROVISIONS RELEVANT TO
ACCOUNTS RECEIVABLES; DEBTS;
TRANSFERRED EMPLOYEES AND BUSINESS CONTRACTS
ARTICLE 5. COLLATERAL AGREEMENT
ARTICLE 6. REPRESENTATIONS, WARRANTIES AND
COVENANTS OF SELLER - INDEMNIFICATION
ARTICLE 7. CLOSING
ARTICLE 8. NON-COMPETITION
ARTICLE 9. CONFIDENTIALITY
ARTICLE 10. NO-ASSIGNMENT
ARTICLE 11. COMMUNICATION TO THIRD PARTIES
ARTICLE 12. COSTS, FEES AND REGISTRATION TAX
ARTICLE 13. JOINT AND SEVERAL LIABILITY OF ASA
INTERNATIONAL AND ASA ITALY
ARTICLE 14. GOVERNING LAW
ARTICLE 15. ARBITRATION
ARTICLE 16. FINAL PROVISIONS
LIST OF EXHIBITS
EXHIBIT 2.2(i)(c) List of certain (major) Business Contracts in
force As of the Reference Date whose value (i.e. the total
consideration which Seller would be entitled to receive or
to pay thereunder) exceeds Itl. 25,000,000 (twenty-five
million of Italian Liras);
EXHIBIT 2.2(ii) List of the Transferred Employees;
EXHIBIT 2.3(i)(f) List of certain Seller's claims and of court
Proceedings which Seller is part to as of the Reference
Date;
EXHIBIT 3.1.1 Reference Date Financial Statement [which includes the
List of the Inventory, the List of the Fixed Assets, the
List of the Accounts Receivable, the List of the
Intellectual Property Rights and the List of the Debts (all
updated as of the Reference date)];
EXHIBIT 5.1(i) Contract between ASA Italy and Findest for the
performance of certain software support services;
EXHIBIT 6.1(b) Material Adverse Change Disclosures;
EXHIBIT 7.3 Deed of Transfer of the Business.
* * *
1. DEFINITIONS
1.1 In this Agreement and in the Exhibits hereto the following terms and
expressions - where used with the initial capital letter, either singular
or plural - shall have the meanings indicated herebelow, unless
inconsistent with the specific context:
(a) "Accounts Receivables" shall have the meaning specified in
Article 2.2(i)(e) of the Agreement;
(b) "ASA International" shall mean ASA International Ltd;
(c) "ASA Italy" shall mean ASA International's wholly owned Italian
subsidiary, which ASA International is going to incorporate or
purchase on or before December 31, 1997;
(d) "Assets" shall have the meaning specified in Article 2.2(i) of the
Agreement;
(e) "Assumed Liabilities" shall have the meaning specified in Article
2.2(iii) of the Agreement;
(f) "Astra Informatica" shall mean Astra Informatica S.r.l. in
liquidazione, a subsidiary of Seller (currently subject to a
voluntary liquidation procedure) with registered office at Padova,
Viale dell'Industria 32;
(g) "Astra Informatica Quota" shall mean a quota representative of 100%
(one hundred per cent) of the registered and paid-in capital of Astra
Informatica (currently owned by Seller);
(h) "Astra Services" shall mean Astra Services S.r.l., a subsidiary of
Seller with registered office at Padova, Viale dell'Industria 32;
(i) "Astra Services Quota" shall mean a quota representative of 100% (one
hundred per cent) of the registered and paid-in capital of Astra
Services (currently owned by Seller);
(j) "Business" shall mean the business carried on by Seller at the
Closing Date in relation to the creation, marketing and supply of the
Software and to the performance of the Other Services;
(k) "Business Books" shall mean all of the official books and records
pertinent to the Business, which Seller keeps or is obliged to keep
pursuant to the applicable laws and regulations;
(l) "Business Contracts" shall have the meaning specified in Article
2.2(i)(c) of the Agreement;
(m) "Closing Date" shall mean January 12, 1998;
(n) "Collateral Agreement" shall mean the contract collateral to this
Agreement to be executed between ASA Italy and Cedes on the Closing
Date, in accordance with the provisions of Clause "Collateral
Agreement" of the Agreement;
(o) "Debts" shall have the meaning specified in Article 2.2(iii)(a) of
the Agreement;
(p) "Deed of Transfer of the Business" shall mean the agreement providing
for the sale and transfer of the Business from Seller to ASA Italy
(whose text is enclosed as Exhibit 7.3 to the Agreement) to be
executed and notarized by Seller and ASA Italy on the Closing Date,
in accordance with the provisions Of Article 2556 of the Italian
Civil Code;
(q) "Digigraphics" shall mean Digigraphics S.r.l., a subsidiary of Seller
with registered office at Udine, Viale Leopardi 126;
(r) "Digigraphics Quota" shall mean a quota representative of 100% (one
hundred per cent) of the registered and paid-in capital of
Digigraphics (currently owned by Seller);
(s) "Effective Date" shall mean December 31, 1997;
(t) "Effective Date Financial Statement" shall mean the financial
statement of the Business as of the Effective Date;
(u) "Effective Date Net-Worth" shall mean the net-worth of the Business
(to be calculated without taking into account the Goodwill) as of the
Effective Date, as determined on the Basis of the Effective Date
Financial Statement;
(v) "Employment Contracts" shall mean the contracts currently in force
between Seller and each of the Transferred Employees;
(w) "Excluded Assets" shall have the meaning specified in Article 2.3(i)
of the Agreement;
(x) "Excluded Liabilities" shall have the meaning specified in Article
2.3(ii) of the Agreement;
(y) "Execution Date" shall mean the date of execution of this Agreement
(i.e. the date of the written confirmation through which Seller
notifies ASA International of its acceptance of the contractual
proposal relevant to the Agreement);
(z) "Final Purchase Price" shall mean the final consideration due (and to
be paid for) by Purchaser to Seller in consideration for the purchase
of the Business;
(aa) "Findest" shall mean Seller's parent company Findest S.r.l., with
registered office at Viale dell'Industria 32, Padova;
(bb) "Fixed Assets" shall have the meaning specified in
Article 2.2(i)(a) of the Agreement;
(cc) "Goodwill" shall mean the goodwill of the Business, as
specified in Article 3.1.1 of the Agreement;
(dd) "Independent Accountant" shall mean Reconta Ernst & Young;
(ee) "Intellectual Property Rights" shall have the meaning
specified in Article 2.2(i)(b) of the Agreement;
(ff) "Inventory" shall have the meaning specified in Article 2.2
2.2(i)(d) of the Agreement;
(gg) "Other Services" shall mean the services of installation and of
maintenance of the Software which, jointly with the activity of
creation, marketing and supply of software programs, constitute the
Business of Seller;
(hh) "Overdue Credits" shall have the meaning specified in Article
4.1.4 of the Agreement;
(ii) "Parties" shall mean Seller (i.e. Cedes S.r.l.) and Purchaser
(i.e. ASA Italy and ASA International);
(ll) "Provisional Purchase Price" shall mean the provisional consideration
for the purchase of the Business calculated as of the Reference Date,
to be thereafter adjusted in order to determine the Final Purchase
Price;
(jj) "Purchaser" shall mean, jointly and severally, ASA Italy (through
which ASA International Ltd shall purchase the Business from Seller)
and ASA International Ltd;
(kk) "Reference Date" shall mean the date of September 30, 1997;
(ll) "Reference Date Financial Statement" shall mean the financial
statement of the Business as of the Reference Date, enclosed as
Exhibit 3.1.1 to the Agreement;
(mm) "Reference Date Net-Worth" shall mean the net worth of the Business
(calculated without taking into account the Goodwill) as of the
Reference Date, as determined on the basis of the Reference Date
Financial Statement;
(nn) "Seller" shall mean Cedes S.r.l.;
(oo) "SIPI-U" shall mean SIPI-U S.r.l., a subsidiary of Seller with
registered office at Udine, Viale Leopardi 126;
(pp) "SIPI-U Quota" shall mean a quota representative of 100% (one hundred
per cent) of the registered and paid-in capital of SIPI-U (currently
owned by Seller);
(qq) "Software" shall mean the software programs listed in Exhibit
2.2(i)(b) to the Agreement;
(rr) "TFR" shall mean the severance leaving indemnity accrued in
favour of the Transferred Employees;
(ss) "Transferred Employees" shall mean those of Seller's employees listed
in Exhibit 2.2(ii) to the Agreement which are engaged in the Business
as at the Closing Date.
2. SALE AND PURCHASE OF THE BUSINESS
2.1 Subject to the provisions of this Agreement Seller shall sell, transfer
and convey to Purchaser, and Purchaser shall acquire from Seller, the
Business (as an on going concern), with effect as of the Effective Date.
2.2 The Business to be transferred, sold and conveyed hereunder from Seller to
Purchaser shall include:
(i) the following assets (the "Assets"), as existing/in force and
available to Seller as of the Effective Date, as long as they are not
part of the Excluded Assets [as specified in Article 2.3(i)
hereinafter]:
(a) the hardware equipment, office furniture, vehicles, etc. (the
"Fixed Assets" - the so-called immobilizzazioni materiali nette)
[a list of the Fixed Assets owned by, and available to, Seller
as of the Reference Date is annexed to the Reference Date
Financial Statement];
(b) the intellectual property rights of Seller related to the
Software (the "Intellectual Property Rights"- the so-called
immobilizzazioni immateriali nette) [a list and description of
the Intellectual Property Rights owned by Seller as of the
Reference Date is annexed to the Reference Date Financial
Statement];
(c) all of the sale, purchase, distributorship, lease,
license, agency, supply, consultancy, cooperation, etc.
commercial (but not financial) contracts or engagements
pertinent to the Business (the "Business Contracts")
entered into by Seller prior to and in force as of the
Effective Date [a list of the Business Contracts in
force as of the Reference Date whose value (i.e. the
total consideration which Seller would be entitled to
receive or to pay thereunder) individually exceeds the
amount of Itl. 25,000,000 (twenty-five million of
Italian Liras) is annexed to this Agreement as Exhibit
2.2 (i) cc)];
(d) the hardware equipment and products (the "Inventory" the
so-called prodotti finiti e merci) [a list of the Inventory
existing and available to Seller as of the Reference Date is
annexed to the Reference Date Financial Statement];
(e) the Accounts Receivables related to the Business (duly
invoiced by Seller towards its customers) and the pre-
paid expenses, including all of the credits relevant to
deposits, advance or security payments made by Seller in
relation to any of the Business Contracts (the "Accounts
Receivables" - the so-called crediti commerciali verso
terzi, crediti consociate, altri crediti, ratei e
risconti attivi e depositi cauzionali) [a list of the
Accounts Receivables outstanding as of the Reference
Date, is enclosed to the Reference Date Financial
Statement];
(f) the cash available in a bank current account at Banca Antoniana
Popolare Veneta (the so-called disponibilita liquide);
(g) the Goodwill;
(h) the tradename "Cedes" and all variants thereof (provided that
Seller shall be entitled to continue to use such tradename, for
the purpose of, and for the time required in order to complete,
the liquidation of its company);
(ii) the Transferred Employees, as listed in Exhibit 2.2 (ii) hereto;
(iii) The specific liabilities or obligations pertinent to the Business
listed below, existing as of the Effective Date and as long as they
are not part of the Excluded Liabilities [as specified in Article
2.3(ii) hereinafter] (the "Assumed Liabilities"). The Assumed
Liabilities shall be limited to the following specific liabilities:
(a) the trade accounts payable of the Business (whether or
not due or matured), as recorded in the Business Books,
all of the proportional portions of advance payments or
security deposits which Seller received from customers
or third parties and any liability related to the
Transferred Employees (including, but not limited to,
any accrued net TFR) (the "Debts" - the so-called debiti
verso fornitori, debiti commerciali consociate,
competenze del personale, trattamento di fine rapporto
lavoro, creditori diversi e ratei e risconti passivi)
[a list of the Debts existing(even though not yet due)
as of the Reference Date, is annexed to the Reference
Date Financial Statement];
(b) all liabilities arising out from, or in some way related
to, the Business Contracts, the Other Services or the
Business. Exhibit 2.2(i)(c) to this Agreement contains a
list of the Business Contracts (Business Contracts which
include all related liabilities) and of any additional
liabilities (other than the Debts and the liabilities
resulting from the Financial Statements) which
individually exceeds the amount of Itl. 25,000,000
(twenty-five million of Italian Liras);
(c) the so-called fondo rischi e oneri which has been agreed
upon and mutually established by Seller and Purchaser
(on a lump sum and equitable basis) after having
properly and duly assessed the risks, liabilities,
losses and costs possibly related to the existing
Business Contracts and to the existing business projects
of Seller (including, but not limited to, any liability
related to the so-called year 2000 compliance of the
Software);
(d) all liabilities arising under or in relation to any product
liability suit, action, claim or proceedings (whether for
personal injuries or property damages) against Seller relating
to products sold, or services performed in connection with the
Business (after the Effective Date), which will be possibly
instituted against Purchaser after the Effective Date; and
(e) all liabilities of any kind and nature that are attributable to,
or incurred in connection with the Business, after the Effective
Date.
2.3 The Business shall not include (or shall be deemed in any case not to
include, for the purposes of this Agreement), the following excluded
Assets and Excluded Liabilities (as existing/in force as of the Effective
Date):
(i) Excluded Assets
(a) the employees of Seller other than the Transferred
Employees;
(b) Seller's credits relevant to VAT tax as well as all other
credits of Seller towards the State or any other
tax/administrative/governmental body or authority;
(c) any and all present or past contractual relationships between
Seller and Findest, as well as any Seller's credit or claim
related or in some way connected thereto [except for the lease
agreement referred to in Article 4.4.3 and the agreement for
software support services referred to in Article 5.1(ii)];
(d) any and all insurance contracts which Seller is part to;
(e) Astra Services Quota, Digigraphics Quota, Astra
Informatica Quota and SIPI-U Quota;
(f) all proceeds related to or which will derive from (i)
court proceedings instituted (or which will be
instituted) by or against Seller prior to the Effective
Date and/or from (ii) certain Seller's claims towards
third parties [a list of the court proceedings which
Seller is part to as of the Reference Date and of the
above mentioned claims is enclosed herewith as Exhibit
2.3(i)(f)].
(ii) Excluded Liabilities
(a) all debts or liabilities or any kind and nature of
Seller towards Findest;
(b) all liabilities related to court proceedings instituted (or
which will be instituted) by or against Seller prior to the
Effective Date;
(c) all liabilities related to the tax treatment of compensation and
benefits of consultants to the Seller prior to the Effective
Date; and
(d) all liabilities that are not specifically included in the
Assumed Liabilities.
3. PURCHASE PRICE AND PAYMENTS
3.1 Purchase Price
3.1.1 The Provisional Purchase Price of the Business shall be equal to (i) a
cash payment equal to the Reference Date Net-Worth, as resulting on the
basis of the Reference Date Financial Statement enclosed herewith as
Exhibit 3.1.1 [i.e. Itl. 25,000,000 (twenty- fifty million Italian Liras)]
plus (ii) the Goodwill [conventionally corresponding to 100,000 (one
hundred thousand) shares of common stock ("ASA Common Stock") ASA
International]. for mere tax purposes the value of ASA International
shares shall be considered that quoted on the NASDAQ at the close of the
business of the Effective Date.
3.2 Adjustments of the Provisional Purchase Price and determination of the
Final Purchase Price.
3.2.1 The cash portion of the Provisional Purchase Price indicated under Article
3.11 above shall be adjusted (i.e. increased or decreased) in order to
reflect any variation which will possibly occur between the Reference Date
and the Effective Date with respect to the value of the items contained in
the Reference Date Financial Statement on the basis of their net-book
value, except for (i) the Fixed Assets and the Intellectual Property
Rights; (ii) the so-called fondo rischi e oneri; and (iii) the Goodwill
which have been evaluated on a lump sum and equitable basis between Seller
and Purchaser, all as set forth on Exhibit 3.2.1. and which, therefore,
will not be subject to any adjustment. The same criteria shall be adopted
in the preparation of the Effective Date Financial Statement.
Notwithstanding anything to the contrary, in no event shall the Effective
Date Net Worth exceed Itl. 26,000,000 (twenty-six million Italian Liras)
or be less than Itl. 24,000,000 (twenty-four million Italian Liras).
3.2.2 It is agreed that Seller and Purchaser shall make their best efforts and
endeavours in order to have the Effective Date Net- Worth equal or very
close to the Reference Date Net-Worth. In any event Seller and Purchaser
agree that (i) if the Effective Date Net-Worth results higher than the
Reference Date Net-Worth, Seller shall be entitled to receive immediately
from Purchaser an amount equal to such difference [either in cash or - if
still possible by excluding from the Assets certain Accounts Receivables
not yet cashed (to be selected by Seller)]; and that(ii) if the Effective
Date Net-Worth results lower than the Reference Date Net-Worth, Seller
shall be obliged promptly to provide to Purchaser an amount equal to such
difference [either in cash or - if still possible by retaining from the
Assumed Liabilities (and therefore by paying directly) certain still
outstanding Debts (other than TFR) to be selected by Seller, after having
consulted with Purchaser)].
3.2.3 Within and not later than 90 (ninety) days from the Closing Date
Seller(with the support and cooperation of Purchaser which - to this
extent - shall promptly make available to Seller any information, data or
document reasonably required by the latter) shall prepare and deliver to
Purchaser the Effective Date Financial Statement, which will be prepared
by Seller on a basis consistent with the accounting principles adopted in
the preparation of the Reference Date Financial Statement and which will
include a statement showing the proposed allocation (also for tax
purposes) of the Purchase Price with respect to the various items
composing the Business.
3.2.4 No later than 30 (thirty) days after the date the Effective Date Financial
Statement is delivered to Purchaser, Purchaser shall notify Seller in
writing whether Purchaser disagrees with the Effective Financial
Statement. Such notice shall specify with Reasonable details the items of
the Effective Date Financial Statement with which Purchaser disagrees. If
Purchaser fail to give Seller such notice within the above mentioned 30
(thirty) day period, Purchaser shall be deemed to have agreed with Seller
as to the Effective Date Financial Statement.
3.2.5 In the event that Purchaser notifies Seller of its disagreement with
Seller as to the Effective Date Financial Statement within the 30 (thirty)
day period referred to in Article 3.2.3 above, Seller and Purchaser shall
use reasonable efforts to resolve any such dispute, but if a final
resolution is not obtained within 60 (sixty) days after the Effective Date
Financial Statement is delivered to Purchaser, any remaining dispute shall
be resolved by the Independent Accountant [which will be entrusted for by
any of the Parties hereto, which is hereby authorized and empowered to do
it also on behalf of the other Party(ies)].
3.2.6 In order to perform its tasks the Independent Accountant shall be given
access to (and copies of) any document, data or account pertinent to the
Business and utilized by Seller in the preparation of the Effective Date
Financial Statement. The activity of the Independent Accountant shall be
limited exclusively to (i) resolving those items which Purchaser
identified in its notice to Seller and as to which Purchaser disagreed and
to (ii) determining whether or not such items were properly reflected into
the Effective Date Financial Statement (in any case without prejudice for
the provisions and restrictions provided for under Article 3.2.1 above).
The final determination of the Independent Auditor shall be delivered to
Seller and Purchaser in a written report and shall be binding and
conclusive upon the Parties hereto. The costs and fees of the Independent
Accountant shall be borne one-half by Seller and one-half by Purchaser.
3.2.7 The Final Purchase Price due by Purchaser to Seller in consideration for
the transfer, sale and conveyance of the Business shall be equal to (i)
the Closing-Date Net-Worth resulting from the Effective Date Financial
Statement, as possibly revised or amended on the basis of the Independent
Accountant's decisions plus (ii) the Goodwill. The Final Purchase Price,
determined pursuant to the above, shall not be subject to further
revisions, adjustments or rectifications, in any case without prejudice
for the provisions of Article 5.1(ii) and of the option agreement enclosed
hereto as Exhibit 5.1(ii).
3.3 Payments
3.3.1 On the Closing Date, simultaneously with the execution of the Deed of
Transfer of the Business, Purchaser (i) shall pay to Seller an amount
equal to the Reference Date Net-Worth and (ii) - as consideration for the
Goodwill - shall deliver and transfer in property (free of any lien,
pledge or encumbrances) of Seller 100,000 (one hundred thousand) shares of
ASA Common Stock.
3.3.2 If, for the year ending December 31, 1998, the aggregate pre-tax profits
of ASA Italy related to the Business and to the business of SIPI-U (which
Purchaser is purchasing from SIPI-U through a separate contract), computed
in accordance with the methods used by Purchaser for reporting its results
of operations to the U.S. Securities and Exchange Commission, equal or
exceed 750,000,000 Italian Liras, then ASA International shall issue to
Seller an additional 100,000 (one hundred thousand)50,000 (fifty thousand)
shares of ASA International Common Stock, promptly after the publication
of such results.
3.3.2 Purchaser's cash payment to Seller pursuant to Article 3.3.1 above shall
be made by means of bankary drafts/assegni circolari, issued by a primary
Italian bank. All other payments hereunder (from Purchaser to Seller or
vice-versa) shall be made through wire transfers to the bank current
accounts which each Party shall timely communicate in writing to the other
Party.
4. SPECIAL PROVISIONS RELEVANT TO ACCOUNTS RECEIVABLES; DEBTS;
TRANSFERRED EMPLOYEES AND BUSINESS CONTRACTS
4.1 Accounts Receivables
4.1.1 In any case without prejudice for the provisions of Article 3.2.2 above,
all of the Accounts Receivables relevant to the Business as of the
Effective Date shall be transferred hereunder to Purchaser, which shall be
responsible of their collection.
4.1.2 One of the exhibits to the Reference Date Financial Statement contains the
List of the Accounts Receivables as of the Reference Date, where the name
of each debtor as well as the amount and the due date of each Account
Receivable are specified. Such list shall be duly updated by Seller (in
order to reflect the status of the Accounts Receivable as of the Effective
Date) by the 90 (ninety) day term provided for under Article 3.2.3 above
for the preparation and delivery to Purchaser of the Effective Date
Financial Statement (to which such updated list shall be annexed).
4.1.3 Thereafter, within the 15th day of each calendar month (starting from
February 1998) Purchaser shall deliver to Seller an updated List of the
Accounts Receivables, in which all payments received during the relevant
month and any still outstanding balance shall be duly highlighted.
4.1.4 Purchaser shall be entitled to assign and re-transfer back to Seller or to
any third party designated by the latter in exchange for a cash payment by
Seller to Purchaser equal to the full amount of such Accounts Receivables
all those Accounts Receivables which are still overdue on June 30, 1998
(the "Overdue Credits"); in any case without prejudice for the aggregate
cap provided for under Article 6.3.1 hereinafter and provided however that
Purchaser shall not be entitled to assign back to Seller, and Seller shall
not be obliged to accept the assignment (and provide for the consequent
payment to Purchaser, at the nominal value) of:
(i) any Overdue Credit towards SIPI-U;
(ii) those Overdue Credits for which Purchaser fails or has failed
(a) to take all steps reasonably required to obtain the
payment from the debtor in due course, and/or (b) promptly to
notify Seller in writing of any event (such as risk of
bankruptcy or liquidation of the entity) which would have
required an immediate action of recovery of the outstanding
credit (it being agreed that in case any such notice is
timely given to Seller, the latter shall be entitled to
request the immediate assignment of the outstanding Accounts
Receivables for which recovery action appears to be
recommended and for which Seller shall make a cash payment to
Purchaser in the full amount of such Accounts Receivables);
and/or
(iii) those Overdue Credits in relation to which Purchaser has made
discounts, accepted liabilities or reached any settlement with the
debtors, without the prior written consent of Seller.
4.1.5 It is agreed that any amount which will be cashed by Purchaser after the
Effective Date from any of the debtors contained in the List of the
Accounts Receivables attached to the Reference Date Financial Statement
(as updated by Seller, pursuant to Article 4.1.2 above), shall be firstly
and automatically imputed (i) to that or those of the Account Receivables
that the paying debtor specifies, or (ii) in lack of any specification
made by the paying debtor, to that or those of the Account Receivables
that the paying debtor is liable for, rather (and before) than to any
other credit Purchaser may have towards the same debtor (whether arisen or
matured prior to, on or after the Effective Date).
4.1.6 It is further agreed that should any (or any portion of the) Accounts
Receivables be paid to Seller rather than to Purchaser (in accordance with
the provisions of Article 2559 of the Italian Civil Code), Seller shall
promptly pay to Purchaser in cash any amount so cashed.
4.2 Debts
4.2.1 In any case without prejudice for the provisions of Article 3.2.2 above
all of the Debts as of the Effective Date shall be assumed hereunder by
Purchaser, which shall be responsible of their payment.
4.2.2 The exhibits to the Reference Date Financial Statement contain the List of
the Debts as of the Reference Date. Such list shall be duly updated by
Seller (in order to reflect the status of the Debts as of the Effective
Date) by the 90 (ninety) day term provided for under Article 3.2.3 above
for the preparation and delivery to Purchaser of the Effective Date
Financial Statement (to which such updated list shall be enclosed).
4.2.3 Purchaser shall hold Seller indemnified from any liability and obligation
arising out from or in connection with any Debt (including liabilities
deriving from action instituted against Seller by any creditors, pursuant
to the provisions of Article 2560 of the Italian Civil Code), provided
that Seller notifies Purchaser in writing of any request of payment which
Seller receives for Debts for which Purchaser is responsible, within 15
(fifteen) days from the receipt of any such request.
4.2.4 It is further agreed that Seller shall (in any case without prejudice for
the aggregate cap provided for under Article 6.3.1 hereinafter) hold
Purchaser indemnified from any liability or obligation Purchaser may be
subject to as to any claim for payment that Purchaser receives after the
Closing Date [but in any case not later than 18 (eighteen) months
thereafter] for debts (i) pertinent to the Business (and for which
Purchaser may be held liable, according to the provisions of Article 2560
of the Italian Civil Code), (ii) arisen and matured before the Effective
Date and (iii) which were not properly reflected into the Effective Date
Financial Statement (and which, accordingly, were not taken into account
for the purpose of determining the Final Purchase Price). The above
Seller's obligation shall not apply with respect to any debt of Purchaser
towards SIPI-U) and shall be effective only provided that Purchaser:
(a) notifies Seller in writing of any request of payment received from
asserted creditors within and not later than 30 (thirty) days from
the date of its receipt, specifying the amount and all other
significant details of the received claim; and
(b) refrains from (x) making any written acknowledgement or acceptance of
liability, and/or (y) providing to any payment to the claiming
creditor and/or (z) reaching any settlement with such creditor,
without the prior written consent of Seller, which consent shall not
be unreasonably withheld or delayed.
4.2.5 Upon receipt of a Purchaser's notice pursuant to Article 4.2.4(a) above,
Seller shall promptly confirm to Purchaser whether: either payment of the
relevant claim is to be made (providing, in such case, promptly to
reimburse to Purchaser the amount due therefor); or - to the best of
Seller's knowledge - the payment of such claim is not due. In this latter
case Purchaser and Seller shall act jointly (provided that any final
decision will pertain to Seller) in order to reject the creditor's claim
and/or possibly to reach a settlement thereabout, it being agreed however
that Seller shall keep Purchaser indemnified from any amount Purchaser may
be held to disburse for the payment/settlement of the subject claim
(including any amount to be paid for legal assistance, as may be
reasonably required to reject the creditor's claim; but in any case
without prejudice for the aggregate cap provided for under Article 6.3.1
hereinafter).
4.3. Transferred Employees
4.3.1 All of the Employment Contracts relevant to the Transferred Employees
listed in Exhibit 2.2(ii) hereto (which are still in force as of the
Effective Date) shall be transferred from Seller to the Purchaser with
effect as of the Effective Date.
4.3.2 The List of the Transferred Employees details, for each Transferred
Employee, the position occupied, the salary and any other special
privilege (including special bonus) that the relevant Employment Contract
provides (other than those set forth in the applicable National Collective
Labour Contracts), as well as the accrued net TFR.
4.4. Business Contracts
4.4.1 In accordance with the provisions of Article 2558 of the Italian Civil
Code, all of the Business Contracts shall be automatically transferred
from Seller to the Purchaser with effect as of the Effective Date.
4.4.2 Exhibit 2.2(i)(c) to this Agreement contains a list of all the (sale,
purchase, distributorship, lease, license, agency, supply, consultancy,
cooperation, etc.) Business Contracts in force as of the Reference Date,
whose value (i.e. the total consideration which Seller would be entitled
to receive or to pay thereunder) exceeds the amount of Itl. 25,000,000
(twenty-five million of Italian Liras). Such list shall be duly updated by
Seller in order to reflect any change occurred thereto between the
Reference Date and the Effective Date by the 90 (ninety) day term provided
for under Article 3.2.3 above for the preparation and delivery to
Purchaser of the Effective Date Financial Statement (to which such updated
list shall be annexed).
4.4.3 The Business Contracts include the lease agreement executed on November
30, 1997 between Seller (as lessee) and Findest (as lessor, proprietor of
the building) in relation to certain office spaces located at Viale
dell'Industria 32, Padova (as better specified in the lease agreement)
currently occupied by Seller. Without prejudice for the mandatory
provisions of Law no. 392 of 1978 relating to the lease of spaces utilized
for commercial purposes, by the execution of this Agreement Purchaser
confirms its intention and willingness (and Seller declares its
availability fairly to evaluate any Purchaser's request) to (i) reduce
possibly the office spaces in which the Business will be conducted in the
future solely to the first floor of the building currently occupied by
Cedes S.r.l. and (ii) terminate in any event the lease agreement referred
to above and release the office spaces not later than August 31, 1998. As
of the Effective Date the office spaces lease agreement shall be
transferred to Purchaser and Seller shall release and deliver such office
spaces to Purchaser.
4.4.4 Seller shall use its reasonable efforts and endeavours in order to assure
a successful transfer of the Business Contracts to Purchaser but,
nevertheless, it shall not be responsible of any event which may occur as
to any of the Business Contracts [such as, but not limited to, termination
for convenience, failure of renewal, etc.) which may occur as from the
Effective Date.
5. COLLATERAL AGREEMENT
5.1 On the Closing Date Purchaser and Findest shall execute the Collateral
Agreement whose text is enclosed to this Agreement as Exhibit 8.1(i),
whereby Purchaser undertakes to provide Findest, for a period ending on
December 1999 and for the considerations specified in the contract, with
certain services and support related to the software owned or operated by
Findest.
6. REPRESENTATIONS, WARRANTIES AND COVENANTS OF SELLER -
INDEMNIFICATION
6.1 Representations and Warranties
6.1.1 Seller grants hereby to Purchaser the following representations and
warranties, and Purchaser hereby acknowledges and accepts that such
representations and warranties are the sole representations and warranties
made or granted by Seller as to the Business and, in general terms, the
transaction provided for under this Agreement; accordingly Purchaser
agrees that there are no (express or implied) representations and/or
warranties other than those expressly listed herein:
(a) Books and Records
The Business Books (and any other proper and mandatory books of
account and records pertinent to the Business) have been kept in
accordance with the Italian accounting principles and regulations.
(b) No Material Adverse Effect - Disclosures To Seller's knowledge, save
for what is specified in Exhibit 6.1(b) to this Agreement in the
period between the Reference Date and the Execution Date no events
have occurred having or likely to have a material adverse effect on
the Business.
(c) Business Contracts
(i) There are no Business Contracts, or unusual or exceptional
commitments in connection with the Business, which did not
arise in the ordinary course of The Business;
(ii) Seller has no knowledge of the invalidity, illegality or
non-effectiveness of any of the Business Contracts.
(d) Title
(i) Seller is the owner of, and/or has good and marketable
title as to, all of the Assets;
(ii) There are not now nor will be outstanding at the Effective Date
any mortgage, pledge, lien or other encumbrance on the Assets.
(e) Litigation
Except for the proceedings listed in Exhibit 2.3(i)(f) (proceedings
which Seller shall continue to be responsible for, and which are not
to be transferred to Purchaser hereunder), there are no actions or
proceedings (neither arbitral) in any court in which Seller is
involved(apart from those relating to debt collections) nor, to the
best of Seller's knowledge, any such proceedings have been commenced
or have been have been threatened.
(f) Safety, Health
The Business is in compliance with all laws, regulations and
generally accepted industry standards for the protection of the
safety and health of its employees. To the best of Seller's
knowledge, in this respect no actions have been undertaken or
threatened by government, public health institutions or other
governmental agencies, local authorities, trade unions or
individuals.
(g) Environmental Protection
The Business has been carried on in compliance with all Applicable
provisions of law concerning environmental protection. To the best of
Seller's knowledge, in this respect no actions have been undertaken
or threatened by government, public health institutions or other
governmental agencies, local authorities, trade unions or
individuals.
(h) Compliance with Laws
The Business has been conducted in material respect, in Accordance
with all applicable laws and regulations of Italy.
(i) Taxes and Social Contributions
All proper tax and social contributions returns and payments have
been made to the relevant authorities and none of the same are
subject to or are likely to be the subject to any dispute.
(j) Existence and Good Standing
Seller is a corporation existing, organized and in good standing
under the laws of Italy and has the appropriate powers and authority
to own its properties and carry on the Business.
(k) Powers to execute the Agreement
Seller has the powers to execute and deliver this Agreement and to
consummate the transactions contemplated thereby. The Agreement shall
be binding on Seller and the consummation by Seller of the
transactions contemplated thereby will not violate any organizational
documents of Seller nor any contract or law and will not result in
the creation of any lien upon any of the Assets. Unless otherwise
specified herein, or under the applicable laws, no consent of third
parties are required in connection with the Agreement.
(l) No transfer of Assets
Since the Reference Date Seller has not transferred any Assets of the
Business or any rights in any intellectual property of the Business,
other than transfers made by Seller in the ordinary course of the
Business;
(m) Permits
Seller has, and as of the Effective Date, Purchaser shall be entitled
to, all necessary permits, licenses and governmental authorizations
required for the ownership and operation of the Business (to the
extent that any such permit, licence and/or governmental
authorization is transferable and such transfer is permitted by the
applicable laws).
(n) Effective Date Net-Worth Value
The Effective Date Net-Worth will not be less than Itl.
24,000,000 (twenty-four million Italian Liras) nor greater
than Itl. 26,000,000 (twenty-six millions Italian Liras).
(o) Labour Matters
Except as set forth on Exhibit 2.2(ii), there are no agreements with
any labour union or association with respect to the Business and
there has not been a work slowdown stoppage due to labour problems.
6.1.2 The representations and warranties granted hereunder shall remain in full
force and effect for a period of 24 (twenty-four) months from the
Effective Date, except only for the representations and warranties under
letters (f), (g) and (i), which shall extend up to the expiration of the
statute of limitation applicable with respect to the relevant duties and
obligations attributable to the Business.
6.2 Covenants
6.2.1 Between the Execution Date and the Effective Date Seller covenants and
agrees as follows:
(a) To conduct diligently the Business operations in the ordinary course
of its business and in full compliance with the applicable laws; and
not to change any of its operational, marketing, pricing or
purchasing policies;
(b) To pay when due all the Debts incurred by it in relation to the
Business;
(c) Not to enter into any Business Contract, other than those in the
ordinary course of its business, without the prior written approval
of Purchaser in each case;
(d) Not to increase the salary, compensation or fringe benefits of any of
the Transferred Employees, without the prior written approval of
Purchaser;
(e) Not to enter into any new employment agreement, and not to become
liable for any bonus, profit-sharing or incentive payment to, any of
the Transferred Employees (other than those mandatory pursuant to the
applicable law or to the applicable National Collective Labour
Contracts);
(f) Not to incur any obligation or liability with respect to the Business
except current obligations and liabilities incurred in the ordinary
course of business;
(g) To use its diligent and best efforts to effect the consummation of
the transactions contemplated hereunder;
(h) To maintain insurance on all of the Assets;
(i) To preserve its business operations intact, and to maintain good
business relations with its clients, customers, suppliers and others
having business or professional dealings with it;
(j) To maintain the books and records of the Business in accordance with
generally accepted accounting principles consistently applied;
(k) To give Purchaser free access to its Business, facilities and books
and records; and
(l) To maintain itself as an Italian corporation and to file all tax
returns and required reports and pay all taxes when due.
6.2.2 From and after the Closing Date, Seller covenants and agrees as follows:
(a) For a period of 90 (ninety) days after the Closing Date, reasonably
to assist and cooperate with Purchaser to preserve for Purchaser the
Goodwill;
(b) Following the Closing Date, to cooperate with Purchaser to prosecute
and enforce any and all non-competition or similar arrangements or
rights (even though non contractual/on tort) related to the Business
to which Seller is a party or is entitled, for the benefit of
Purchaser; and
(c) Promptly pay or discharge, when due, all of the Excluded Liabilities;
(d) As soon as they are available, deliver to Purchaser a copy of the
certification relevant to the financial statements of Seller relevant
to years 1995, 1996 and 1997.
6.3 Indemnification
6.3.1 Seller shall defend, indemnify and hold Purchaser harmless from and
against all duly documented damages or losses which ASA Italy shall bear
or be subject to in consequence of the breach by Seller of any of the
representations, warranties or covenants made or undertaken by Seller
under this Agreement, provided however that (i) the total and aggregate
amount which Seller may be obliged to pay to Purchaser (or to whichever
other party) in consequence of, or in connection with, any claim or
actions related to this SubSection "Indemnification" or however to this
Agreement shall in no case exceed a maximum and all inclusive cap equal to
the Final Purchase Price [i.e. the Effective Date Net-Worth plus the value
of 100,000 (one hundred thousand) shares of ASA International, as
officially quoted on the National Association of Securities Dealers
Automated Quotation System at the close of business of the Effective
Date].
6.3.2 Within 30 (thirty) working days from the date on which it becomes aware of
any possible breach of the representations and warranties Purchaser shall
give written notice thereof to Seller. Any such written notice shall
specify in reasonable details the alleged breach of the representations
and warranties and the amount of the expected losses which may be caused
by any such breach. Any delay in the giving of such notice shall not limit
Purchaser's rights hereunder, provided that (i) Purchaser proves that such
delay did not irrevocably prejudice the ability of Seller to defend the
claim described in such notice and (ii) in any event the delay does not
exceed 90 (ninety) days from the date on which Purchaser becomes aware of
any possible breach of the representations and warranties.
6.3.3 No claims for asserted breaches of the representations, warranties or
covenants provided for under this Agreement shall be valid and effective,
and no liability shall be borne by Seller in connection therewith, if made
by Purchaser after the expiration of the applicable terms, as provided for
under Article 6.1.2 above.
6.3.4 Upon and after any notice made to Seller with respect to an asserted
breach of the contractual representations and warranties Purchaser shall
refrain from taking any steps which might reasonably be expected to
adversely affect the position of Seller as to the alleged breach, without
the prior written consent of Seller (which, otherwise, shall be
automatically discharged of any liability thereunder)
6.4 Fondo Rischi e Oneri
6.4.1 Seller and Purchaser recognize and acknowledge that the fondo rischi e
oneri contained in the Reference Date Financial Statement and which will
be contained in the Effective Date Financial Statement has been determined
taking into proper account the liabilities which Purchaser could be
subject to for the projects in progress with an estimate to complete
greater than the value to be billed, and specifically for the following
projects:
(thousand of Italian Liras)
Project Estimated revenue Days Costs
CELMIS-Y2000 200.000 600 390.000
PARMACOTTO 40.000 450 292.500
BOERINGER - 0 - 50 32.500
7. CLOSING
7.1 The sale and purchase of the Business provided for hereunder as
well as the obligations of Purchaser to execute the Deed of
Transfer of the Business and the Collateral Agreement are subject
to the condition precedent that on or prior to the Closing Date
none of the covenants, representations and warranties undertaken
or made under this Agreement by Seller is ascertained and
documented by Purchaser as being untrue or incorrect in any
material respect.
7.2 The Closing Date shall be January 12, 1998 at the offices of the Seller or
such other date and place as shall be agreed by the Seller and Purchaser.
7.3 On the Closing Date the representatives duly empowered or authorized
legally to bind Seller and ASA Italy shall execute and have notarized the
Deed of Transfer of the Business (whose text is enclosed hereto as Exhibit
7.3); simultaneously the representatives duly empowered or authorized
legally to bind ASA Italy and Findest shall execute the Collateral
Agreement.
7.4 On the Closing Date, upon execution of the Deed of Transfer of the
Business, Seller shall deliver or, as the case may be, make available (or
cause to be delivered or made available) to Purchaser:
(i) such documents as may be reasonably required to complete the sale of
the Business and vest title thereto in Purchaser;
(ii) the Business Books and copy of the official books (or of the portions
of the official books) which can not be delivered to Purchaser but
which pertain also to the Business, the Transferred Employees payroll
records and any other records information pertinent to the Business;
(iii) any promotional, advertising and/or technical material pertinent to
the Software or to the Other Services;
(iv) copy of the value added tax, income and other direct and indirect tax
records pertinent to the Business.
7.5 There shall not have been any event since the Execution Date, and any of
the obligations of Purchaser will be subject to the fulfilment on or prior
to the Closing Date of the following conditions:
(a) No proceedings shall have been instituted or threatened or claim made
against Seller seeking to restrain or prohibit or obtain damages with
respect to the transactions contemplated by this Agreement which in
either event could have a material adverse effect on the transactions
provided for hereunder, or on the Business;
(b) Receipt of approvals of the Boards of Directors of Seller and
Purchaser.
7.6 In the event that the condition set forth in this Agreement has not been
satisfied, Purchaser shall have the rights to terminate this Agreement
upon written notice to Seller.
8. NON-COMPETITION
8.1 Seller shall promptly assign to Purchaser all orders relating to the
Business, including enquiries or orders for any equipment Software or
Other Services sold in connection with the Business which Seller may
receive on or after the Closing Date.
8.2 Starting from the Closing Date, and for a period of 5 (five) years
thereafter, Seller shall refrain from engaging in any activity
similar or comparable to, or in any case in competition with, the
Business transferred to Purchaser hereunder. For the same 5
(five) year period Seller (which is undertaking this specific
obligation also on behalf of the other subsidiaries controlled by
Findest) shall refrain from hiring any person which, at the time
of such hiring, is, or within 90 (ninety) days of such hiring was,
an employee of ASA Italy.
9. CONFIDENTIALITY
9.1 Purchaser shall consider and treat any information, written or
oral, which Purchaser has already and/or will however become aware
prior, after or in connection with the execution of this Agreement
(with particular, but not exclusive, reference to all those
information Purchaser will have access to between the Execution
Date and the Closing Date) as strictly confidential (hereinafter
"Restricted Information").
9.2 Purchaser agrees that in case this Agreement will not be
fulfilled, for any reasons whatsoever, for a period of 5 (five)
years from the date the Agreement has been executed it shall not
use (directly or indirectly), reproduce or disclose to any third
party such Restricted Information. Purchaser undertakes therefore
to protect the secrecy and confidentiality of the Restricted
Information received hereunder as it uses to protect its own
information of like kind.
9.3 "Restricted Information" shall not include information which was known to
Purchaser prior to its receipt from Seller, which is publicly available,
which becomes known to Purchaser other than from Seller, or which is
required to be disclosed by law.
10. NO ASSIGNMENT
10.1 None of the Parties hereto shall be entitled to assign its obligations and
rights under this Agreement to any third party, without the prior written
consent of the other Party, which consent shall not be unreasonably
withheld or delayed.
11. COMMUNICATION TO THIRD PARTIES
11.1 Within 15 (fifteen) days from the Closing Date Purchaser and Seller
shall provide jointly to notify in writing all of the creditors, the
debtors and the parties to the Business Contracts which may be affected
by the transfer of the Business (in accordance with the provisions of
Articles 2558, 2559 and 2560 of the Italian Civil Code) that the transfer
has taken place from Seller to Purchaser, as of the Effective Date.
12. COSTS, FEES AND REGISTRATION TAX
12.1 Each Party shall pay the costs and expenses (including, without
limitation, fees and disbursements of counsels, financial advisors and
accountants) incurred by it in connection with the entering into and
completion of this Agreement.
12.2 The fees of the Notary Public who shall provide to the notarization of the
Deed of Transfer shall be borne by Purchaser, while the Registration Tax
associated with the transfer of the Business shall be equally shared
between the Parties.
12.3 The Parties represent and warrant to each other that in connection with
the transactions contemplated by this Agreement no broker or finder is or
will be entitled to any fee or commission (i) from Seller, based on
arrangements made by Purchaser or (ii) from Purchaser, based on
arrangements made by Seller.
13. JOINT AND SEVERAL LIABILITY; GUARANTEE
13.1 By the execution of this Agreement ASA International and ASA Italy
undertake a joint and several liability and responsibility for the
performance of any and all obligations provided for hereunder, under the
Collateral Agreement and any other contract related or in some way
connected to this Agreement. Accordingly, in any case without prejudice
for the generality of the foregoing, ASA Italy and ASA International shall
be jointly and severally responsible for the proper and timely performance
of the obligations deriving from or related to the Deed of Transfer of the
Busine ss, even though such Deed of Transfer of the Business is executed
only by ASA Italy.
13.2 At the Closing, Findest shall execute and deliver to ASA a guarantee of
the obligations of Seller pursuant to this Agreement.
14. GOVERNING LAW
14.1 This Agreement shall be governed by, and construed in accordance with, the
laws of Italy.
15. ARBITRATION
15.1 The Parties shall make their best efforts and endeavours to settle
amicably any disputes arising out from or in connection with the
interpretation, validity or performance of this Agreement.
15.2 Any dispute arising between the Parties in connection with the
interpretation, validity or performance of this Agreement which can not be
amicably settled shall be submitted by any of the Parties hereto to the
decision of a Board of Arbitrators, which shall decide according to law.
The proceedings shall be conducted in accordance with the applicable
provisions of the ICC (International Chamber of Commerce of Paris) Rules,
then in force.
15.3 Each Party shall designate an arbitrator, the Plaintiff in the request of
arbitration and the Defendant in the reply to the request; the third
arbitrator shall be appointed by contract of the 2 (two) Parties'
arbitrators and shall act as the Chairman of the Board. Should the
Defendant fail to designate its arbitrator within 20 (twenty) days from
the receipt of the request of arbitration containing the appointment of
the Plaintiff's arbitrator and/or should no agreement be reached within 20
(twenty) d ays from the appointment of the last of the two arbitrators,
then the third arbitrator shall be appointed by the Chairman of the ICC.
15.4 The arbitration shall take place in London and shall be conducted in the
English language. The Board of Arbitrators shall render the judgement
within 180 (one hundred and eighty) days from the date on which all the
arbitrators have assumed their duties.
15.5 Any dispute relevant to this Agreement which, due to its particular
nature, can not be subject to arbitration shall be brought by the Parties
hereof to the exclusive jurisdiction of the Court of Padova (Italy).
16. FINAL PROVISIONS
16.1 Entire Agreement - This Agreement shall mean the provisions set forth in
the sections and sub-sections and articles of this instrument and in the
Exhibits hereto, all of which form an integral part hereof, as the same
may be amended from time to time in accordance with the terms hereof. This
Agreement, including all its Exhibits, constitutes the entire contract
between the Parties in respect to the subject matter hereof. All previous
documents, undertakings and contracts between the Parties, whether oral,
written or otherwise, concerning the subject matter hereof are hereby
cancelled and superseded and shall not affect or modify any of the
provisions of this Agreement or of its Exhibits.
16.2 Amendments - No modification, change or amendment of this Agreement shall
be valid and binding on the Parties except if made in writing by duly
empowered representatives of Seller and Purchaser.
16.3 Survival - The provisions of this Agreement shall survive to, prevail on,
and continue to apply after, the execution of the Collateral Agreement and
of any other contract in some way related or connected to this Agreement
(such as, but not limited to, the Deed of Transfer of the Business), even
though this Agreement is not expressly referenced therein, and with the
sole exception for the case where the non-application of this Agreement
(in relation to one or more contracts) is expressly agreed upon i n
writing by the Parties.
16.4 Headings - The headings contained in this Agreement are for reference
purposes only and shall not affect in any way the meaning or
interpretation of this Agreement.
16.5 Severability - The validity of remaining sections, sub-sections, articles,
provisions, terms and parts of this Agreement shall not be affected by a
court, administrative board or other proceedings of competent jurisdiction
deciding that a section, sub-section, article, provision, term or part of
this Agreement is judged as illegal, unenforceable, in conflict with any
law or contrary to public policy. In such event the Parties hereto shall
(by amending this Agreement or any related contract upon good faith
negotiations), properly replace such section(s), sub-section(s),
article(s), provision(s), term(s) or part(s) by a reasonable new
section(s), sub-section(s), article(s), provision(s), term(s) or part(s)
which, as far as legally possible, shall approximate what the Parties
intended by the original section, sub-section, article, provision, term or
part.
16.6 Waivers - The failure of either Party to insist upon strict adherence to
any term or provision of this Agreement on any occasion shall not be
considered a waiver of any right thereafter to insist upon strict
adherence to that term or provision or any other term or provision of this
Agreement. Any waiver will be valid only if made in writing.
16.7 Notices - All notices, approvals, requests, consents and other
communications to be given pursuant to this Agreement shall be in writing
and shall be deemed to have been duly given (i) when hand-delivered to a
duly authorized representative of the receiving Party or (ii) if sent by
registered mail or courier, when actually delivered to the receiving
Party, as proved by a duly countersigned return-receipt, or (iii) when
sent by fax, when the transmitting Party obtain a positive report of
transmission, but only provided that the notice is then immediately
confirmed by r egistered mail or courier and such registered mail or
courier is delivered to the addressee Party within 10 (ten) days after the
date of the fax communication. Any notice shall be addressed as follows:
16.8 Public Disclosure - Prior to the Closing, the Parties will each endeavour
to not disclose or otherwise make public the fact that negotiation between
them are in progress with respect to this transaction (or any other
information relating thereto), except (a) disclosures to their respective
employees, accountants, attorneys, advisors, lenders and other agents; (b)
discussions, as necessary, or otherwise appropriate, with customers,
suppliers, landlords, licensees and other third parties; and (c) as ot
herwise required by applicable law. The Parties shall mutually cooperate
with respect to the timing and substance of any discussions with third
parties described in (b) above.
If to Purchaser:
ASA International Ltd.
10, Speen Street
Framingham
Massachusetts 01701
USA
Fax: 001/508/6260645
Attention: Managing Director
If to the Seller:
Cedes S.r.l.
Viale dell'Industria, 32
35129 Padova
ITALY
Fax: 0039/49/8075317
Attention: Managing Director
* * *
If you agree on the contents of the above drafted proposal please have it -
together with the Schedules relevant to - printed on your company's head letter
and send it back to us duly initialized and signed in order to express your
acceptance.
Yours Sincerely,
ASA International Ltd.
Mr. _______________________
Title: ____________________
___________________________
UNQUOTE
Yours Sincerely,
Cedes S.r.l.
Mr. /s/ Alfonso Ostinelli
Title Attorney
___________________________
EXHIBIT E-2
Udine, December 18 1997
Messrs.
ASA International Ltd.
10, Speen Street
Framingham
Massachusetts 01701
USA
Dear Sirs,
Reference is made to your letter dated December 15, 1997 which is
hereinbelow fully transcribed for acceptance.
QUOTE
Framingham, December 15 1997
Messrs.
SIPI-U S.r.l.
Viale Leopardi 126
33100 UDINE
Dear Sirs,
Further to the discussions held in the last months we hereby set forth the
terms and conditions of the prospected transfer of business on an ongoing
concern basis to be executed from our company to your company.
AGREEMENT FOR THE PURCHASE AND SALE OF ASSETS
ON AN ON GOING CONCERN BASIS
(CONTRATTO DI CESSIONE DI AZIENDA)
By and between
SIPI-U S.r.l., a limited liability company duly incorporated under the laws
of Italy, with its registered office at Udine, Viale Leopardi 126
and
ASA International Ltd., a company duly incorporated under the laws of the
State of Massachusetts (U.S.), with its registered office at Framingham 10,
Speen Street
WITNESSETH:
- - WHEREAS SIPI-U S.r.l. is an Italian company active and engaged in the
fields of the creation, marketing and supply of software programs and
of the performance of services of installation and maintenance of
such programs; and
- - WHEREAS ASA International Ltd. is a US corporation active and engaged
in the field of the creation, manufacturing and supply of software
programs; and
- - WHEREAS ASA International Ltd. is going to incorporate or purchase on
or before December 31, 1997 in Italy a wholly owned subsidiary
("ASA Italy"); and
- - WHEREAS ASA International Ltd. (through its wholly owned subsidiary
ASA Italy) desires to purchase from SIPI-U S.r.l., and SIPI-U S.r.l.
Desires to sell to ASA Italy, the business of SIPI-U S.r.l. relevant
to the creation, marketing and supply of software programs and to the
performance of services of installation and maintenance of such
programs, in accordance with the terms and conditions provided for
under this agreement.
IT IS HEREBY AGREED AS FOLLOWS:
TABLE OF CONTENTS
ARTICLE 1. DEFINITIONS
ARTICLE 2. SALE AND PURCHASE OF THE BUSINESS
ARTICLE 3. PURCHASE PRICE AND PAYMENTS
ARTICLE 4. SPECIAL PROVISIONS RELEVANT TO
ACCOUNTS RECEIVABLES; DEBTS;
TRANSFERRED EMPLOYEES AND BUSINESS CONTRACTS
ARTICLE 5. INTENTIONALLY LEFT BLANK
ARTICLE 6. REPRESENTATIONS, WARRANTIES AND
COVENANTS OF SELLER - INDEMNIFICATION
ARTICLE 7. CLOSING
ARTICLE 8. NON-COMPETITION
ARTICLE 9. CONFIDENTIALITY
ARTICLE 10. NO-ASSIGNMENT
ARTICLE 11. COMMUNICATION TO THIRD PARTIES
ARTICLE 12. COSTS, FEES AND REGISTRATION TAX
ARTICLE 13. JOINT AND SEVERAL LIABILITY OF ASA
INTERNATIONAL AND ASA ITALY
ARTICLE 14. GOVERNING LAW
ARTICLE 15. ARBITRATION
ARTICLE 16. FINAL PROVISIONS
LIST OF EXHIBITS
EXHIBIT 2.2(i)(c) List of certain (major) Business Contracts in force
As of the Reference Date whose value (i.e. the total
consideration which Seller would be entitled to
receive or to pay thereunder) exceeds Itl.
25,000,000 (twenty-five million of Italian Liras);
EXHIBIT 2.2(ii) List of the Transferred Employees;
EXHIBIT 2.3(i)(f) List of certain Seller's claims and of court
Proceedings which Seller is part to as of the
Reference Date;
EXHIBIT 3.1.1 Reference Date Financial Statement [which includes
the List of the Inventory, the List of the Fixed
Assets, the List of the Accounts Receivable, the
List of the Intellectual Property Rights and the
List of the Debts (all updated as of the Reference
date)];
EXHIBIT 6.1(b) Material Adverse Change Disclosures;
EXHIBIT 7.3 Deed of Transfer of the Business.
* * *
1. DEFINITIONS
1.1 In this Agreement and in the Exhibits hereto the following terms
and expressions - where used with the initial capital letter,
either singular or plural - shall have the meanings indicated
herebelow, unless inconsistent with the specific context:
(a) "Accounts Receivables" shall have the meaning specified in
Article 2.2(i)(e) of the Agreement;
(b) "ASA International" shall mean ASA International Ltd;
(c) "ASA Italy" shall mean ASA International's wholly owned
Italian subsidiary, which ASA International is going to
incorporate or purchase on or before December 31, 1997;
(d) "Assets" shall have the meaning specified in Article 2.2(i)
of the Agreement;
(e) "Assumed Liabilities" shall have the meaning specified in
Article 2.2(iii) of the Agreement;
(f) "Business" shall mean the business carried on by Seller at
the Closing Date in relation to the creation, marketing and
supply of the Software and to the performance of the Other
Services;
(g) "Business Books" shall mean all of the official books and
records pertinent to the Business, which Seller keeps or is
obliged to keep pursuant to the applicable laws and
regulations;
(h) "Business Contracts" shall have the meaning specified in
Article 2.2(i)(c) of the Agreement;
(i) "Closing Date" shall mean January 12, 1998;
(j) "Debts" shall have the meaning specified in Article
2.2(iii)(a) of the Agreement;
(k) "Deed of Transfer of the Business" shall mean the agreement
providing for the sale and transfer of the Business from
Seller to ASA Italy (whose text is enclosed as Exhibit 7.3 to
the Agreement) to be executed and notarized by Seller and ASA
Italy on the Closing Date, in accordance with the provisions
Of Article 2556 of the Italian Civil Code;
(l) "Effective Date" shall mean December 31, 1997;
(m) "Effective Date Financial Statement" shall mean the financial
statement of the Business as of the Effective Date;
(n) "Effective Date Net-Worth" shall mean the net-worth of the
Business (to be calculated without taking into account the
Goodwill) as of the Effective Date, as determined on the
Basis of the Effective Date Financial Statement;
(o) "Employment Contracts" shall mean the contracts currently in
force between Seller and each of the Transferred Employees;
(p) "Excluded Assets" shall have the meaning specified in Article
2.3(i) of the Agreement;
(q) "Excluded Liabilities" shall have the meaning specified in
Article 2.3(ii) of the Agreement;
(r) "Execution Date" shall mean the date of execution of this
Agreement (i.e. the date of the written confirmation through
which Seller notifies ASA International of its acceptance of
the contractual proposal relevant to the Agreement);
(s) "Final Purchase Price" shall mean the final consideration due
(and to be paid for) by Purchaser to Seller in consideration
for the purchase of the Business;
(t) "Findest" shall mean Seller's parent company Findest S.r.l.,
with registered office at Viale dell'Industria 32, Padova;
(u) "Fixed Assets" shall have the meaning specified in
Article 2.2(i)(a) of the Agreement;
(v) "Goodwill" shall mean the goodwill of the Business, as
specified in Article 3.1.1 of the Agreement;
(w) "Independent Accountant" shall mean Reconta Ernst & Young;
(x) "Intellectual Property Rights" shall have the meaning
specified in Article 2.2(i)(b) of the Agreement;
(y) "Inventory" shall have the meaning specified in Article 2.2
2.2(i)(d) of the Agreement;
(z) "Other Services" shall mean the services of installation and
of maintenance of the Software which, jointly with the
activity of creation, marketing and supply of software
programs, constitute the Business of Seller;
(aa) "Overdue Credits" shall have the meaning specified in Article
4.1.4 of the Agreement;
(bb) "Parties" shall mean Seller (i.e. SIPI-U S.r.l.) and Purchaser
(i.e. ASA Italy and ASA International);
(cc) "Provisional Purchase Price" shall mean the provisional
consideration for the purchase of the Business calculated as
of the Reference Date, to be thereafter adjusted in order to
determine the Final Purchase Price;
(dd) "Purchaser" shall mean, jointly and severally, ASA Italy
(through which ASA International Ltd shall purchase the
Business from Seller) and ASA International Ltd;
(ee) "Reference Date" shall mean the date of September 30, 1997;
(ff) "Reference Date Financial Statement" shall mean the financial
statement of the Business as of the Reference Date, enclosed
as Exhibit 3.1.1 to the Agreement;
(gg) "Reference Date Net-Worth" shall mean the net worth of the
Business (calculated without taking into account the
Goodwill) as of the Reference Date, as determined on the
basis of the Reference Date Financial Statement;
(hh) "Seller" shall mean SIPI-U S.r.l.;
(ii) "Software" shall mean the software programs listed in Exhibit
2.2(i)(b) to the Agreement;
(jj) "TFR" shall mean the severance leaving indemnity accrued in
favour of the Transferred Employees;
(kk) "Transferred Employees" shall mean those of Seller's
employees listed in Exhibit 2.2(ii) to the Agreement which
are engaged in the Business as at the Closing Date.
2. SALE AND PURCHASE OF THE BUSINESS
2.1 Subject to the provisions of this Agreement Seller shall sell,
transfer and convey to Purchaser, and Purchaser shall acquire from
Seller, the Business (as an on going concern), with effect as of
the Effective Date.
2.2 The Business to be transferred, sold and conveyed hereunder from
Seller to Purchaser shall include:
(i) the following assets (the "Assets"), as existing/in force and
available to Seller as of the Effective Date, as long as they
are not part of the Excluded Assets [as specified in
Article 2.3(i) hereinafter]:
(a) the hardware equipment, office furniture, vehicles, etc.
(the "Fixed Assets" - the so-called immobilizzazioni
materiali nette) [a list of the Fixed Assets owned by,
and available to, Seller as of the Reference Date is
annexed to the Reference Date Financial Statement];
(b) the intellectual property rights of Seller related to
the Software (the "Intellectual Property Rights"- the
so-called immobilizzazioni immateriali nette) [a list
and description of the Intellectual Property Rights
owned by Seller as of the Reference Date is annexed to
the Reference Date Financial Statement];
(c) all of the sale, purchase, distributorship, lease,
license, agency, supply, consultancy, cooperation, etc.
commercial (but not financial) contracts or engagements
pertinent to the Business (the "Business Contracts")
entered into by Seller prior to and in force as of the
Effective Date [a list of the Business Contracts in
force as of the Reference Date whose value (i.e. the
total consideration which Seller would be entitled to
receive or to pay thereunder) individually exceeds the
amount of Itl. 25,000,000 (twenty-five million of
Italian Liras) is annexed to this Agreement as Exhibit
2.2 (i) cc)];
(d) the hardware equipment and products (the "Inventory" -
the so-called prodotti finiti e merci) [a list of the
Inventory existing and available to Seller as of the
Reference Date is annexed to the Reference Date
Financial Statement];
(e) the Accounts Receivables related to the Business (duly
invoiced by Seller towards its customers) and the pre-
paid expenses, including all of the credits relevant to
deposits, advance or security payments made by Seller in
relation to any of the Business Contracts (the "Accounts
Receivables" - the so-called crediti commerciali verso
terzi, crediti consociate, altri crediti, ratei e
risconti attivi e depositi cauzionali) [a list of the
Accounts Receivables outstanding as of the Reference
Date, is enclosed to the Reference Date Financial
Statement];
(f) the cash available in a bank current account at Banca
Antoniana Popolare Veneta (the so-called disponibilita
liquide);
(g) the Goodwill;
(h) the tradename "SIPI-U" and all variants thereof (provided
that Seller shall be entitled to continue to use such
tradename, for the purpose of, and for the time required
in order to complete, the liquidation of its company);
(ii) the Transferred Employees, as listed in Exhibit 2.2 (ii)
hereto;
(iii) The specific liabilities or obligations pertinent to the
Business listed below, existing as of the Effective Date and
as long as they are not part of the Excluded Liabilities [as
specified in Article 2.3(ii) hereinafter] (the "Assumed
Liabilities"). The Assumed Liabilities shall be limited to
the following specific liabilities:
(a) the trade accounts payable of the Business (whether or
not due or matured), as recorded in the Business Books,
all of the proportional portions of advance payments or
security deposits which Seller received from customers
or third parties and any liability related to the
Transferred Employees (including, but not limited to,
any accrued net TFR) (the "Debts" - the so-called debiti
verso fornitori, debiti commerciali consociate,
competenze del personale, trattamento di fine rapporto
lavoro, creditori diversi e ratei e risconti passivi)
[a list of the Debts existing(even though not yet due)
as of the Reference Date, is annexed to the Reference
Date Financial Statement];
(b) all liabilities arising out from, or in some way related
to, the Business Contracts, the Other Services or the
Business. Exhibit 2.2(i)(c) to this Agreement contains a
list of the Business Contracts (Business Contracts which
include all related liabilities) and of any additional
liabilities (other than the Debts and the liabilities
resulting from the Financial Statements) which
individually exceeds the amount of Itl. 25,000,000
(twenty-five million of Italian Liras);
(c) the so-called fondo rischi e oneri which has been agreed
upon and mutually established by Seller and Purchaser
(on a lump sum and equitable basis) after having
properly and duly assessed the risks, liabilities,
losses and costs possibly related to the existing
Business Contracts and to the existing business projects
of Seller (including, but not limited to, any liability
related to the so-called year 2000 compliance of the
Software);
(d) all liabilities arising under or in relation to any
product liability suit, action, claim or proceedings
(whether for personal injuries or property damages)
against Seller relating to products sold, or services
performed in connection with the Business (after the
Effective Date), which will be possibly instituted
against Purchaser after the Effective Date; and
(e) all liabilities of any kind and nature that are
attributable to, or incurred in connection with the
Business, after the Effective Date.
2.3 The Business shall not include (or shall be deemed in any case not
to include, for the purposes of this Agreement), the following
excluded Assets and Excluded Liabilities (as existing/in force as
of the Effective Date):
(i) Excluded Assets
(a) the employees of Seller other than the Transferred
Employees;
(b) Seller's credits relevant to VAT tax as well as all
other credits of Seller towards the State or any other
tax/administrative/governmental body or authority;
(c) any and all present or past contractual relationships
between Seller and Findest, as well as any Seller's
credit or claim related or in some way connected thereto;
(d) any and all insurance contracts which Seller is part to;
(e) all proceeds related to or which will derive from (i)
court proceedings instituted (or which will be
instituted) by or against Seller prior to the Effective
Date and/or from (ii) certain Seller's claims towards
third parties [a list of the court proceedings which
Seller is part to as of the Reference Date and of the
above mentioned claims is enclosed herewith as Exhibit
2.3(i)(f)].
(ii) Excluded Liabilities
(a) all debts or liabilities or any kind and nature of
Seller towards Findest;
(b) all liabilities related to court proceedings instituted
(or which will be instituted) by or against Seller prior
to the Effective Date;
(c) all liabilities related to the tax treatment of
compensation and benefits of consultants to the Seller
prior to the Effective Date; and
(d) all liabilities that are not specifically included in
the Assumed Liabilities.
3. PURCHASE PRICE AND PAYMENTS
3.1 Purchase Price
3.1.1 The Provisional Purchase Price of the Business shall be equal to
(i) a cash payment equal to the Reference Date Net-Worth, as
resulting on the basis of the Reference Date Financial Statement
enclosed herewith as Exhibit 3.1.1 [i.e. Itl. 25,000,000 (twenty-
fifty million Italian Liras)] plus (ii) the Goodwill
[conventionally corresponding to 100,000 (one hundred thousand)
shares of common stock ("ASA Common Stock") ASA International].
for mere tax purposes the value of ASA International shares shall
be considered that quoted on the NASDAQ at the close of the
business of the Effective Date.
3.2 Adjustments of the Provisional Purchase Price and determination of
the Final Purchase Price.
3.2.1 The cash portion of the Provisional Purchase Price indicated under
Article 3.11 above shall be adjusted (i.e. increased or decreased)
in order to reflect any variation which will possibly occur
between the Reference Date and the Effective Date with respect to
the value of the items contained in the Reference Date Financial
Statement on the basis of their net-book value, except for (i) the
Fixed Assets and the Intellectual Property Rights; (ii) the so-
called fondo rischi e oneri; and (iii) the Goodwill which have
been evaluated on a lump sum and equitable basis between Seller
and Purchaser, all as set forth on Exhibit 3.2.1. and which,
therefore, will not be subject to any adjustment. The same
criteria shall be adopted in the preparation of the Effective Date
Financial Statement. Notwithstanding anything to the contrary, in
no event shall the Effective Date Net Worth exceed Itl. 26,000,000
(twenty-six million Italian Liras) or be less than Itl. 24,000,000
(twenty-four million Italian Liras).
3.2.2 It is agreed that Seller and Purchaser shall make their best
efforts and endeavours in order to have the Effective Date Net-
Worth equal or very close to the Reference Date Net-Worth. In any
event Seller and Purchaser agree that (i) if the Effective Date
Net-Worth results higher than the Reference Date Net-Worth, Seller
shall be entitled to receive immediately from Purchaser an amount
equal to such difference [either in cash or - if still possible -
by excluding from the Assets certain Accounts Receivables not yet
cashed (to be selected by Seller)]; and that(ii) if the Effective
Date Net-Worth results lower than the Reference Date Net-Worth,
Seller shall be obliged promptly to provide to Purchaser an amount
equal to such difference [either in cash or - if still possible -
by retaining from the Assumed Liabilities (and therefore by paying
directly) certain still outstanding Debts (other than TFR) to be
selected by Seller, after having consulted with Purchaser)].
3.2.3 Within and not later than 90 (ninety) days from the Closing Date
Seller(with the support and cooperation of Purchaser which - to
this extent - shall promptly make available to Seller any
information, data or document reasonably required by the latter)
shall prepare and deliver to Purchaser the Effective Date
Financial Statement, which will be prepared by Seller on a basis
consistent with the accounting principles adopted in the
preparation of the Reference Date Financial Statement and which
will include a statement showing the proposed allocation (also for
tax purposes) of the Purchase Price with respect to the various
items composing the Business.
3.2.4 No later than 30 (thirty) days after the date the Effective Date
Financial Statement is delivered to Purchaser, Purchaser shall
notify Seller in writing whether Purchaser disagrees with the
Effective Financial Statement. Such notice shall specify with
Reasonable details the items of the Effective Date Financial
Statement with which Purchaser disagrees. If Purchaser fail to
give Seller such notice within the above mentioned 30 (thirty) day
period, Purchaser shall be deemed to have agreed with Seller as to
the Effective Date Financial Statement.
3.2.5 In the event that Purchaser notifies Seller of its disagreement
with Seller as to the Effective Date Financial Statement within
the 30 (thirty) day period referred to in Article 3.2.3 above,
Seller and Purchaser shall use reasonable efforts to resolve any
such dispute, but if a final resolution is not obtained within 60
(sixty) days after the Effective Date Financial Statement is
delivered to Purchaser, any remaining dispute shall be resolved by
the Independent Accountant [which will be entrusted for by any of
the Parties hereto, which is hereby authorized and empowered to do
it also on behalf of the other Party(ies)].
3.2.6 In order to perform its tasks the Independent Accountant shall be
given access to (and copies of) any document, data or account
pertinent to the Business and utilized by Seller in the
preparation of the Effective Date Financial Statement. The
activity of the Independent Accountant shall be limited
exclusively to (i) resolving those items which Purchaser
identified in its notice to Seller and as to which Purchaser
disagreed and to (ii) determining whether or not such items were
properly reflected into the Effective Date Financial Statement (in
any case without prejudice for the provisions and restrictions
provided for under Article 3.2.1 above). The final determination
of the Independent Auditor shall be delivered to Seller and
Purchaser in a written report and shall be binding and conclusive
upon the Parties hereto. The costs and fees of the Independent
Accountant shall be borne one-half by Seller and one-half by
Purchaser.
3.2.7 The Final Purchase Price due by Purchaser to Seller in
consideration for the transfer, sale and conveyance of the
Business shall be equal to (i) the Closing-Date Net-Worth
resulting from the Effective Date Financial Statement, as possibly
revised or amended on the basis of the Independent Accountant's
decisions plus (ii) the Goodwill. The Final Purchase Price,
determined pursuant to the above, shall not be subject to further
revisions, adjustments or rectifications, in any case without
prejudice for the provisions of Article 5.1(ii) and of the option
agreement enclosed hereto as Exhibit 5.1(ii).
3.3 Payments
3.3.1 On the Closing Date, simultaneously with the execution of the Deed
of Transfer of the Business, Purchaser (i) shall pay to Seller an
amount equal to the Reference Date Net-Worth and (ii) - as
consideration for the Goodwill - shall deliver and transfer in
property (free of any lien, pledge or encumbrances) of Seller
100,000 (one hundred thousand) shares of ASA Common Stock.
3.3.2 Intentionally Left Blank.
3.3.2 Purchaser's cash payment to Seller pursuant to Article 3.3.1 above
shall be made by means of bankary drafts/assegni circolari, issued
by a primary Italian bank. All other payments hereunder (from
Purchaser to Seller or vice-versa) shall be made through wire
transfers to the bank current accounts which each Party shall
timely communicate in writing to the other Party.
4. SPECIAL PROVISIONS RELEVANT TO ACCOUNTS RECEIVABLES; DEBTS;
TRANSFERRED EMPLOYEES AND BUSINESS CONTRACTS
4.1 Accounts Receivables
4.1.1 In any case without prejudice for the provisions of Article 3.2.2
above, all of the Accounts Receivables relevant to the Business as
of the Effective Date shall be transferred hereunder to Purchaser,
which shall be responsible of their collection.
4.1.2 One of the exhibits to the Reference Date Financial Statement
contains the List of the Accounts Receivables as of the Reference
Date, where the name of each debtor as well as the amount and the
due date of each Account Receivable are specified. Such list
shall be duly updated by Seller (in order to reflect the status of
the Accounts Receivable as of the Effective Date) by the 90
(ninety) day term provided for under Article 3.2.3 above for
the preparation and delivery to Purchaser of the Effective Date
Financial Statement (to which such updated list shall be annexed).
4.1.3 Thereafter, within the 15th day of each calendar month (starting
from February 1998) Purchaser shall deliver to Seller an updated
List of the Accounts Receivables, in which all payments received
during the relevant month and any still outstanding balance shall
be duly highlighted.
4.1.4 Purchaser shall be entitled to assign and re-transfer back to
Seller or to any third party designated by the latter in exchange
for a cash payment by Seller to Purchaser equal to the full amount
of such Accounts Receivables all those Accounts Receivables which
are still overdue on June 30, 1998 (the "Overdue Credits"); in any
case without prejudice for the aggregate cap provided for under
Article 6.3.1 hereinafter and provided however that Purchaser
shall not be entitled to assign back to Seller, and Seller shall
not be obliged to accept the assignment (and provide for the
consequent payment to Purchaser, at the nominal value) of:
(i) any Overdue Credit towards Cedes S.r.l. (a limited liability
company duly incorporated under the laws of Italy, with its
registered office at Padova, Viale dell'Industria 32);
(ii) those Overdue Credits for which Purchaser fails or has failed
(a) to take all steps reasonably required to obtain the
payment from the debtor in due course, and/or (b) promptly to
notify Seller in writing of any event (such as risk of
bankruptcy or liquidation of the entity) which would have
required an immediate action of recovery of the outstanding
credit (it being agreed that in case any such notice is
timely given to Seller, the latter shall be entitled to
request the immediate assignment of the outstanding Accounts
Receivables for which recovery action appears to be
recommended and for which Seller shall make a cash payment to
Purchaser in the full amount of such Accounts Receivables);
and/or
(iii) those Overdue Credits in relation to which Purchaser has made
discounts, accepted liabilities or reached any settlement
with the debtors, without the prior written consent of
Seller.
4.1.5 It is agreed that any amount which will be cashed by Purchaser
after the Effective Date from any of the debtors contained in the
List of the Accounts Receivables attached to the Reference Date
Financial Statement (as updated by Seller, pursuant to Article
4.1.2 above), shall be firstly and automatically imputed (i) to
that or those of the Account Receivables that the paying debtor
specifies, or (ii) in lack of any specification made by the paying
debtor, to that or those of the Account Receivables that the
paying debtor is liable for, rather (and before) than to any other
credit Purchaser may have towards the same debtor (whether arisen
or matured prior to, on or after the Effective Date).
4.1.6 It is further agreed that should any (or any portion of the)
Accounts Receivables be paid to Seller rather than to Purchaser
(in accordance with the provisions of Article 2559 of the Italian
Civil Code), Seller shall promptly pay to Purchaser in cash any
amount so cashed.
4.2 Debts
4.2.1 In any case without prejudice for the provisions of Article 3.2.2
above all of the Debts as of the Effective Date shall be assumed
hereunder by Purchaser, which shall be responsible of their
payment.
4.2.2 The exhibits to the Reference Date Financial Statement contain the
List of the Debts as of the Reference Date. Such list shall be
duly updated by Seller (in order to reflect the status of the
Debts as of the Effective Date) by the 90 (ninety) day term
provided for under Article 3.2.3 above for the preparation and
delivery to Purchaser of the Effective Date Financial Statement
(to which such updated list shall be enclosed).
4.2.3 Purchaser shall hold Seller indemnified from any liability and
obligation arising out from or in connection with any Debt
(including liabilities deriving from action instituted against
Seller by any creditors, pursuant to the provisions of Article
2560 of the Italian Civil Code), provided that Seller notifies
Purchaser in writing of any request of payment which Seller
receives for Debts for which Purchaser is responsible, within 15
(fifteen) days from the receipt of any such request.
4.2.4 It is further agreed that Seller shall (in any case without
prejudice for the aggregate cap provided for under Article 6.3.1
hereinafter) hold Purchaser indemnified from any liability or
obligation Purchaser may be subject to as to any claim for payment
that Purchaser receives after the Closing Date [but in any case
not later than 18 (eighteen) months thereafter] for debts (i)
pertinent to the Business (and for which Purchaser may be held
liable, according to the provisions of Article 2560 of the Italian
Civil Code), (ii) arisen and matured before the Effective Date and
(iii) which were not properly reflected into the Effective Date
Financial Statement (and which, accordingly, were not taken into
account for the purpose of determining the Final Purchase Price).
The above Seller's obligation shall not apply with respect to any
debt of Purchaser towards SIPI-U) and shall be effective only
provided that Purchaser:
(a) notifies Seller in writing of any request of payment received
from asserted creditors within and not later than 30 (thirty)
days from the date of its receipt, specifying the amount and
all other significant details of the received claim; and
(b) refrains from (x) making any written acknowledgement or
acceptance of liability, and/or (y) providing to any payment
to the claiming creditor and/or (z) reaching any settlement
with such creditor, without the prior written consent of
Seller, which consent shall not be unreasonably withheld or
delayed.
4.2.5 Upon receipt of a Purchaser's notice pursuant to Article 4.2.4(a)
above, Seller shall promptly confirm to Purchaser whether: either
payment of the relevant claim is to be made (providing, in such
case, promptly to reimburse to Purchaser the amount due therefor);
or - to the best of Seller's knowledge - the payment of such claim
is not due. In this latter case Purchaser and Seller shall act
jointly (provided that any final decision will pertain to Seller)
in order to reject the creditor's claim and/or possibly to reach a
settlement thereabout, it being agreed however that Seller shall
keep Purchaser indemnified from any amount Purchaser may be held
to disburse for the payment/settlement of the subject claim
(including any amount to be paid for legal assistance, as may be
reasonably required to reject the creditor's claim; but in any
case without prejudice for the aggregate cap provided for under
Article 6.3.1 hereinafter).
4.3. Transferred Employees
4.3.1 All of the Employment Contracts relevant to the Transferred
Employees listed in Exhibit 2.2(ii) hereto (which are still in
force as of the Effective Date) shall be transferred from Seller
to the Purchaser with effect as of the Effective Date.
4.3.2 The List of the Transferred Employees details, for each
Transferred Employee, the position occupied, the salary and any
other special privilege (including special bonus) that the
relevant Employment Contract provides (other than those set forth
in the applicable National Collective Labour Contracts), as well
as the accrued net TFR.
4.4. Business Contracts
4.4.1 In accordance with the provisions of Article 2558 of the Italian
Civil Code, all of the Business Contracts shall be automatically
transferred from Seller to the Purchaser with effect as of the
Effective Date.
4.4.2 Exhibit 2.2(i)(c) to this Agreement contains a list of all the
(sale, purchase, distributorship, lease, license, agency, supply,
consultancy, cooperation, etc.) Business Contracts in force as of
the Reference Date, whose value (i.e. the total consideration
which Seller would be entitled to receive or to pay thereunder)
exceeds the amount of Itl. 25,000,000 (twenty-five million of
Italian Liras). Such list shall be duly updated by Seller in
order to reflect any change occurred thereto between the Reference
Date and the Effective Date by the 90 (ninety) day term provided
for under Article 3.2.3 above for the preparation and delivery to
Purchaser of the Effective Date Financial Statement (to which such
updated list shall be annexed).
4.4.3 Intentionally Left Blank.
4.4.4 Seller shall use its reasonable efforts and endeavours in order to
assure a successful transfer of the Business Contracts to
Purchaser but, nevertheless, it shall not be responsible of any
event which may occur as to any of the Business Contracts [such
as, but not limited to, termination for convenience, failure of
renewal, etc.) which may occur as from the Effective Date.
5. INTENTIONALLY LEFT BLANK
6. REPRESENTATIONS, WARRANTIES AND COVENANTS OF SELLER -
INDEMNIFICATION
6.1 Representations and Warranties
6.1.1 Seller grants hereby to Purchaser the following representations
and warranties, and Purchaser hereby acknowledges and accepts that
such representations and warranties are the sole representations
and warranties made or granted by Seller as to the Business and,
in general terms, the transaction provided for under this
Agreement; accordingly Purchaser agrees that there are no (express
or implied) representations and/or warranties other than those
expressly listed herein:
(a) Books and Records
The Business Books (and any other proper and mandatory books
of account and records pertinent to the Business) have been
kept in accordance with the Italian accounting principles and
regulations.
(b) No Material Adverse Effect - Disclosures
To Seller's knowledge, save for what is specified in Exhibit
6.1(b) to this Agreement in the period between the Reference
Date and the Execution Date no events have occurred having or
likely to have a material adverse effect on the Business.
(c) Business Contracts
(i) There are no Business Contracts, or unusual or
exceptional commitments in connection with the
Business, which did not arise in the ordinary course of
The Business;
(ii) Seller has no knowledge of the invalidity, illegality
or non-effectiveness of any of the Business Contracts.
(d) Title
(i) Seller is the owner of, and/or has good and marketable
title as to, all of the Assets;
(ii) There are not now nor will be outstanding at the
Effective Date any mortgage, pledge, lien or other
encumbrance on the Assets.
(e) Litigation
Except for the proceedings listed in Exhibit 2.3(i)(f)
(proceedings which Seller shall continue to be responsible
for, and which are not to be transferred to Purchaser
hereunder), there are no actions or proceedings (neither
arbitral) in any court in which Seller is involved(apart from
those relating to debt collections) nor, to the best of
Seller's knowledge, any such proceedings have been commenced
or have been have been threatened.
(f) Safety, Health
The Business is in compliance with all laws, regulations and
generally accepted industry standards for the protection of
the safety and health of its employees. To the best of
Seller's knowledge, in this respect no actions have been
undertaken or threatened by government, public health
institutions or other governmental agencies, local
authorities, trade unions or individuals.
(g) Environmental Protection
The Business has been carried on in compliance with all
Applicable provisions of law concerning environmental
protection. To the best of Seller's knowledge, in this
respect no actions have been undertaken or threatened by
government, public health institutions or other governmental
agencies, local authorities, trade unions or individuals.
(h) Compliance with Laws
The Business has been conducted in material respect, in
Accordance with all applicable laws and regulations of Italy.
(i) Taxes and Social Contributions
All proper tax and social contributions returns and payments
have been made to the relevant authorities and none of the
same are subject to or are likely to be the subject to any
dispute.
(j) Existence and Good Standing
Seller is a corporation existing, organized and in good
standing under the laws of Italy and has the appropriate
powers and authority to own its properties and carry on the
Business.
(k) Powers to execute the Agreement
Seller has the powers to execute and deliver this Agreement
and to consummate the transactions contemplated thereby. The
Agreement shall be binding on Seller and the consummation by
Seller of the transactions contemplated thereby will not
violate any organizational documents of Seller nor any
contract or law and will not result in the creation of any
lien upon any of the Assets. Unless otherwise specified
herein, or under the applicable laws, no consent of third
parties are required in connection with the Agreement.
(l) No transfer of Assets
Since the Reference Date Seller has not transferred any
Assets of the Business or any rights in any intellectual
property of the Business, other than transfers made by Seller
in the ordinary course of the Business;
(m) Permits
Seller has, and as of the Effective Date, Purchaser shall be
entitled to, all necessary permits, licenses and governmental
authorizations required for the ownership and operation of
the Business (to the extent that any such permit, licence
and/or governmental authorization is transferable and such
transfer is permitted by the applicable laws).
(n) Effective Date Net-Worth Value
The Effective Date Net-Worth will not be less than Itl.
24,000,000 (twenty-four million Italian Liras) nor greater
than Itl. 26,000,000 (twenty-six millions Italian Liras).
(o) Labour Matters
Except as set forth on Exhibit 2.2(ii), there are no
agreements with any labour union or association with respect
to the Business and there has not been a work slowdown
stoppage due to labour problems.
6.1.2 The representations and warranties granted hereunder shall remain
in full force and effect for a period of 24 (twenty-four) months
from the Effective Date, except only for the representations and
warranties under letters (f), (g) and (i), which shall extend up
to the expiration of the statute of limitation applicable with
respect to the relevant duties and obligations attributable to the
Business.
6.2 Covenants
6.2.1 Between the Execution Date and the Effective Date Seller covenants
and agrees as follows:
(a) To conduct diligently the Business operations in the ordinary
course of its business and in full compliance with the
applicable laws; and not to change any of its operational,
marketing, pricing or purchasing policies;
(b) To pay when due all the Debts incurred by it in relation to
the Business;
(c) Not to enter into any Business Contract, other than those in
the ordinary course of its business, without the prior
written approval of Purchaser in each case;
(d) Not to increase the salary, compensation or fringe benefits
of any of the Transferred Employees, without the prior
written approval of Purchaser;
(e) Not to enter into any new employment agreement, and not to
become liable for any bonus, profit-sharing or incentive
payment to, any of the Transferred Employees (other than
those mandatory pursuant to the applicable law or to the
applicable National Collective Labour Contracts);
(f) Not to incur any obligation or liability with respect to the
Business except current obligations and liabilities incurred
in the ordinary course of business;
(g) To use its diligent and best efforts to effect the
consummation of the transactions contemplated hereunder;
(h) To maintain insurance on all of the Assets;
(i) To preserve its business operations intact, and to maintain
good business relations with its clients, customers,
suppliers and others having business or professional dealings
with it;
(j) To maintain the books and records of the Business in
accordance with generally accepted accounting principles
consistently applied;
(k) To give Purchaser free access to its Business, facilities and
books and records; and
(l) To maintain itself as an Italian corporation and to file all
tax returns and required reports and pay all taxes when due.
6.2.2 From and after the Closing Date, Seller covenants and agrees as
follows:
(a) For a period of 90 (ninety) days after the Closing Date,
reasonably to assist and cooperate with Purchaser to preserve
for Purchaser the Goodwill;
(b) Following the Closing Date, to cooperate with Purchaser to
prosecute and enforce any and all non-competition or similar
arrangements or rights (even though non contractual/on tort)
related to the Business to which Seller is a party or is
entitled, for the benefit of Purchaser; and
(c) Promptly pay or discharge, when due, all of the Excluded
Liabilities;
(d) As soon as they are available, deliver to Purchaser a copy of
the certification relevant to the financial statements of
Seller relevant to years 1995, 1996 and 1997.
6.3 Indemnification
6.3.1 Seller shall defend, indemnify and hold Purchaser harmless from
and against all duly documented damages or losses which ASA Italy
shall bear or be subject to in consequence of the breach by Seller
of any of the representations, warranties or covenants made or
undertaken by Seller under this Agreement, provided however that
(i) the total and aggregate amount which Seller may be obliged to
pay to Purchaser (or to whichever other party) in consequence of,
or in connection with, any claim or actions related to this Sub-
Section "Indemnification" or however to this Agreement shall in
no case exceed a maximum and all inclusive cap equal to the Final
Purchase Price [i.e. the Effective Date Net-Worth plus the value
of 100,000 (one hundred thousand) shares of ASA International, as
officially quoted on the National Association of Securities
Dealers Automated Quotation System at the close of business of the
Effective Date].
6.3.2 Within 30 (thirty) working days from the date on which it becomes
aware of any possible breach of the representations and warranties
Purchaser shall give written notice thereof to Seller. Any such
written notice shall specify in reasonable details the alleged
breach of the representations and warranties and the amount of the
expected losses which may be caused by any such breach. Any delay
in the giving of such notice shall not limit Purchaser's rights
hereunder, provided that (i) Purchaser proves that such delay did
not irrevocably prejudice the ability of Seller to defend the
claim described in such notice and (ii) in any event the delay
does not exceed 90 (ninety) days from the date on which Purchaser
becomes aware of any possible breach of the representations and
warranties.
6.3.3 No claims for asserted breaches of the representations, warranties
or covenants provided for under this Agreement shall be valid and
effective, and no liability shall be borne by Seller in connection
therewith, if made by Purchaser after the expiration of the
applicable terms, as provided for under Article 6.1.2 above.
6.3.4 Upon and after any notice made to Seller with respect to an
asserted breach of the contractual representations and warranties
Purchaser shall refrain from taking any steps which might
reasonably be expected to adversely affect the position of Seller
as to the alleged breach, without the prior written consent of
Seller (which, otherwise, shall be automatically discharged of any
liability thereunder)
6.4 Fondo Rischi e Oneri
6.4.1 Seller and Purchaser recognize and acknowledge that the fondo
rischi e oneri contained in the Reference Date Financial Statement
and which will be contained in the Effective Date Financial
Statement has been determined taking into proper account the
liabilities which Purchaser could be subject to for the projects
in progress with an estimate to complete greater than the value to
be billed, and specifically for the following projects:
(thousand of Italian Liras)
Project Estimated revenue Days Costs
GAIA-X 30,000 97 97,000
7. CLOSING
7.1 The sale and purchase of the Business provided for hereunder as
well as the obligations of Purchaser to execute the Deed of
Transfer of the Business and the Collateral Agreement are subject
to the condition precedent that on or prior to the Closing Date
none of the covenants, representations and warranties undertaken
or made under this Agreement by Seller is ascertained and
documented by Purchaser as being untrue or incorrect in any
material respect.
7.2 The Closing Date shall be January 12, 1998 at the offices of the
Seller or such other date and place as shall be agreed by the
Seller and Purchaser.
7.3 On the Closing Date the representatives duly empowered or
authorized legally to bind Seller and ASA Italy shall execute and
have notarized the Deed of Transfer of the Business (whose text
is enclosed hereto as Exhibit 7.3);
7.4 On the Closing Date, upon execution of the Deed of Transfer of the
Business, Seller shall deliver or, as the case may be, make
available (or cause to be delivered or made available) to
Purchaser:
(i) such documents as may be reasonably required to complete the
sale of the Business and vest title thereto in Purchaser;
(ii) the Business Books and copy of the official books (or of the
portions of the official books) which can not be delivered to
Purchaser but which pertain also to the Business, the
Transferred Employees payroll records and any other records
information pertinent to the Business;
(iii) any promotional, advertising and/or technical material
pertinent to the Software or to the Other Services;
(iv) copy of the value added tax, income and other direct and
indirect tax records pertinent to the Business.
7.5 There shall not have been any event since the Execution Date, and
any of the obligations of Purchaser will be subject to the
fulfilment on or prior to the Closing Date of the following
conditions:
(a) No proceedings shall have been instituted or threatened or
claim made against Seller seeking to restrain or prohibit or
obtain damages with respect to the transactions contemplated
by this Agreement which in either event could have a material
adverse effect on the transactions provided for hereunder, or
on the Business;
(b) Receipt of approvals of the Boards of Directors of Seller and
Purchaser.
7.6 In the event that the condition set forth in this Agreement has
not been satisfied, Purchaser shall have the rights to terminate
this Agreement upon written notice to Seller.
8. NON-COMPETITION
8.1 Seller shall promptly assign to Purchaser all orders relating to
the Business, including enquiries or orders for any equipment
Software or Other Services sold in connection with the Business
which Seller may receive on or after the Closing Date.
8.2 Starting from the Closing Date, and for a period of 5 (five) years
thereafter, Seller shall refrain from engaging in any activity
similar or comparable to, or in any case in competition with, the
Business transferred to Purchaser hereunder. For the same 5
(five) year period Seller (which is undertaking this specific
obligation also on behalf of the other subsidiaries controlled by
Findest) shall refrain from hiring any person which, at the time
of such hiring, is, or within 90 (ninety) days of such hiring was,
an employee of ASA Italy.
9. CONFIDENTIALITY
9.1 Purchaser shall consider and treat any information, written or
oral, which Purchaser has already and/or will however become aware
prior, after or in connection with the execution of this Agreement
(with particular, but not exclusive, reference to all those
information Purchaser will have access to between the Execution
Date and the Closing Date) as strictly confidential (hereinafter
"Restricted Information").
9.2 Purchaser agrees that in case this Agreement will not be
fulfilled, for any reasons whatsoever, for a period of 5 (five)
years from the date the Agreement has been executed it shall not
use (directly or indirectly), reproduce or disclose to any third
party such Restricted Information. Purchaser undertakes therefore
to protect the secrecy and confidentiality of the Restricted
Information received hereunder as it uses to protect its own
information of like kind.
9.3 "Restricted Information" shall not include information which was
known to Purchaser prior to its receipt from Seller, which is
publicly available, which becomes known to Purchaser other than
from Seller, or which is required to be disclosed by law.
10. NO ASSIGNMENT
10.1 None of the Parties hereto shall be entitled to assign its
obligations and rights under this Agreement to any third party,
without the prior written consent of the other Party, which
consent shall not be unreasonably withheld or delayed.
11. COMMUNICATION TO THIRD PARTIES
11.1 Within 15 (fifteen) days from the Closing Date Purchaser and Seller
shall provide jointly to notify in writing all of the creditors,
the debtors and the parties to the Business Contracts which may be
affected by the transfer of the Business (in accordance with the
provisions of Articles 2558, 2559 and 2560 of the Italian Civil Code)
that the transfer has taken place from Seller to Purchaser, as of the
Effective Date.
12. COSTS, FEES AND REGISTRATION TAX
12.1 Each Party shall pay the costs and expenses (including, without
limitation, fees and disbursements of counsels, financial advisors
and accountants) incurred by it in connection with the entering into
and completion of this Agreement.
12.2 The fees of the Notary Public who shall provide to the notarization
of the Deed of Transfer shall be borne by Purchaser, while the
Registration Tax associated with the transfer of the Business shall
be equally shared between the Parties.
12.2 The Parties represent and warrant to each other that in connection
with the transactions contemplated by this Agreement no broker or
finder is or will be entitled to any fee or commission (i) from
Seller, based on arrangements made by Purchaser or (ii) from
Purchaser, based on arrangements made by Seller.
13. JOINT AND SEVERAL LIABILITY; GUARANTEE
13.1 By the execution of this Agreement ASA International and ASA Italy
undertake a joint and several liability and responsibility for the
performance of any and all obligations provided for hereunder, under
the Collateral Agreement and any other contract related or in some
way connected to this Agreement. Accordingly, in any case without
prejudice for the generality of the foregoing, ASA Italy and ASA
International shall be jointly and severally responsible for the
proper and timely performance of the obligations deriving from or
related to the Deed of Transfer of the Business, even though such
Deed of Transfer of the Business is executed only by ASA Italy.
13.2 At the Closing, Findest shall execute and deliver to ASA a guarantee
of the obligations of Seller pursuant to this Agreement.
14. GOVERNING LAW
14.1 This Agreement shall be governed by, and construed in accordance with,
the laws of Italy.
15. ARBITRATION
15.1 The Parties shall make their best efforts and endeavours to settle
amicably any disputes arising out from or in connection with the
interpretation, validity or performance of this Agreement.
15.2 Any dispute arising between the Parties in connection with the
interpretation, validity or performance of this Agreement which
can not be amicably settled shall be submitted by any of the Parties
hereto to the decision of a Board of Arbitrators, which shall decide
according to law. The proceedings shall be conducted in accordance
with the applicable provisions of the ICC (International Chamber of
Commerce of Paris) Rules, then in force.
15.2 Each Party shall designate an arbitrator, the Plaintiff in the
request of arbitration and the Defendant in the reply to the
request; the third arbitrator shall be appointed by contract of the
2 (two) Parties' arbitrators and shall act as the Chairman of the
Board. Should the Defendant fail to designate its arbitrator within
20 (twenty) days from the receipt of the request of arbitration
containing the appointment of the Plaintiff's arbitrator and/or
should no agreement be reached within 20 (twenty) days from the
appointment of the last of the two arbitrators, then the third
arbitrator shall be appointed by the Chairman of the ICC.
15.3 The arbitration shall take place in London and shall be conducted
in the English language. The Board of Arbitrators shall render
the judgement within 180 (one hundred and eighty) days from the
date on which all the arbitrators have assumed their duties.
15.4 Any dispute relevant to this Agreement which, due to its particular
nature, can not be subject to arbitration shall be brought by the
Parties hereof to the exclusive jurisdiction of the Court of
Padova (Italy).
16. FINAL PROVISIONS
16.1 Entire Agreement - This Agreement shall mean the provisions set
forth in the sections and sub-sections and articles of this
instrument and in the Exhibits hereto, all of which form an integral
part hereof, as the same may be amended from time to time in
accordance with the terms hereof. This Agreement, including all its
Exhibits, constitutes the entire contract between the Parties in
respect to the subject matter hereof. All previous documents,
undertakings and contracts between the Parties, whether oral, written
or otherwise, concerning the subject matter hereof are hereby
cancelled and superseded and shall not affect or modify any of the
provisions of this Agreement or of its Exhibits.
16.2 Amendments - No modification, change or amendment of this
Agreement shall be valid and binding on the Parties except if made
in writing by duly empowered representatives of Seller and Purchaser.
16.2 Survival - The provisions of this Agreement shall survive to, prevail
on, and continue to apply after, the execution of the Collateral
Agreement and of any other contract in some way related or connected
to this Agreement (such as, but not limited to, the Deed of Transfer
of the Business), even though this Agreement is not expressly
referenced therein, and with the sole exception for the case where
the non-application of this Agreement (in relation to one or more
contracts) is expressly agreed upon in writing by the Parties.
16.3 Headings - The headings contained in this Agreement are for reference
purposes only and shall not affect in any way the meaning or
interpretation of this Agreement.
16.4 Severability - The validity of remaining sections, sub-sections,
articles, provisions, terms and parts of this Agreement shall not
be affected by a court, administrative board or other proceedings
of competent jurisdiction deciding that a section, sub-section,
article, provision, term or part of this Agreement is judged as
illegal, unenforceable, in conflict with any law or contrary to
public policy. In such event the Parties hereto shall (by amending
this Agreement or any related contract upon good faith negotiations),
properly replace such section(s), sub-section(s), article(s),
provision(s), term(s) or part(s) by a reasonable new section(s),
sub-section(s), article(s), provision(s), term(s) or part(s) which,
as far as legally possible, shall approximate what the Parties
intended by the original section, sub-section, article, provision,
term or part.
16.5 Waivers - The failure of either Party to insist upon strict adherence
to any term or provision of this Agreement on any occasion shall not
be considered a waiver of any right thereafter to insist upon strict
adherence to that term or provision or any other term or provision of
this Agreement. Any waiver will be valid only if made in writing.
16.7 Notices - All notices, approvals, requests, consents and other
communications to be given pursuant to this Agreement shall be in
writing and shall be deemed to have been duly given (i) when hand-
delivered to a duly authorized representative of the receiving Party
or (ii) if sent by registered mail or courier, when actually delivered
to the receiving Party, as proved by a duly countersigned return-
receipt, or (iii) when sent by fax, when the transmitting Party obtain
a positive report of transmission, but only provided that the notice
is then immediately confirmed by registered mail or courier and such
registered mail or courier is delivered to the addressee Party within
10 (ten) days after the date of the fax communication. Any notice
shall be addressed as follows:
16.8 Public Disclosure - Prior to the Closing, the Parties will each
endeavour to not disclose or otherwise make public the fact that
negotiation between them are in progress with respect to this
transaction (or any other information relating thereto), except
(a) disclosures to their respective employees, accountants, attorneys,
advisors, lenders and other agents; (b) discussions, as necessary,
or otherwise appropriate, with customers, suppliers, landlords,
licensees and other third parties; and (c) as otherwise required by
applicable law. The Parties shall mutually cooperate with respect
to the timing and substance of any discussions with third parties
described in (b) above.
If to Purchaser:
ASA International Ltd.
10, Speen Street
Framingham
Massachusetts 01701
USA
Fax: 001/508/6260645
Attention: Managing Director
If to the Seller:
SIPI-U S.r.l.
Viale Leopardi 126
33100 Udine
ITALY
Fax: 0039/432-503960
Attention: Managing Director
* * *
If you agree on the contents of the above drafted proposal please have it -
together with the Schedules relevant to - printed on your company's head letter
and send it back to us duly initialized and signed in order to express your
acceptance.
Yours Sincerely,
ASA International Ltd.
Mr._____________________
Title: _________________
________________________
UNQUOTE
Yours Sincerely
SIPI-U S.r.l.
Mr. /s/ Alfonso Ostinelli
Title: Attorney
_____________________________
EXHIBIT E-3
Padova, January 13 1998
Messrs.
ASA International Ltd.
10, Speen Street
Framingham
Massachusetts 01701
USA
Messrs.
Cedes Associates S.r.l.
Viale dell'Industria 32
PADOVA
Dear Sirs,
reference is made to your letter dated January 13, 1998 which is hereinbelow
fully transcribed for acceptance.
QUOTE
Padova, January 13 1998
Messrs.
CEDES S.r.l.
Viale dell'Industria 32
PADOVA
Messrs.
SIPI-U S.r.l.
Viale Leopardi 126
33100 UDINE
Re.: ADDENDUM TO THE AGREEMENTS FOR THE PURCHASE AND SALE OF ASSETS ON AN ON
GOING CONCERN BASIS (CONTRATTI DI CESSIONE DI AZIENDA) EXECUTED ON
DECEMBER 18, 1997 BETWEEN ASA INTERNATIONAL LTD. ON THE ONE PART AND,
RESPECTIVELY, CEDES S.r.l. AND SIPI-U S.r.l. ON THE OTHER PART
Dears Sirs,
Upon the closing of the transactions provided for under the captioned agreements
(closing which is taking place as of the date hereof) we wish to point out
certain collateral agreements and understandings which have been reached between
Cedes S.r.l. ("Cedes") and SIPI-U S.r.l. ("SIPI-U") on the one part and Asa
International Ltd. ("Asa International") and Asa International's Italian
subsidiary Cedes Associates S.r.l., with registered offices at Viale
dell'Industria 32, Padova ("Asa Italy") on the other par t.
Unless otherwise specified herein, all terms used in this addendum (the
"Addendum")( to the Agreements for the Purchase and Sale of Assets on an on
going concern basis (Contratti di Cessione di Azienda) executed on December 18,
1997 between ASA International Ltd. on the one part and, respectively, Cedes
S.r.l. and SIPI-U S.r.l. on the other part with the initial capital letter shall
have the meaning attributed to them in such Agreements.
1. Fondo Rischi e Oneri
Cedes, SIPI-U, Asa International and Asa Italy (hereinafter collectively
referred to also as the "Parties") recognize, acknowledge and accept that
the so-called fondo rischi e oneri (as provided for under Articles
2.2(iii)(c), 3.2.1. and 6.4 of the Agreements and as resulting from the
Reference Date Financial Statements) has been constituted for both Cedes
and SIPI-U as of the date hereof. Such constitution has taken place by
means of a loan in the amount of Itl. 475,000,000 (for Cedes) and Itl.
67,000,00 0 (for SIPI-U) extended to Cedes and to SIPI-U by Cedes' parent
company Findest S.r.l.. The relevant amounts are respectively available: to
Cedes in its bank current account no. 87233720186 at Banca Commerciale
Italiana, Padova Branch; and to SIPI-U in its bank current account no.
24137440125 at Banca Commerciale Italiana, Padova Branch. The contracts
between Cedes and SIPI-U and Banca Commerciale Italiana relevant to the
above mentioned bank current accounts are to be included among the Business
Contracts which are transferred from Sellers to Asa Italy under the
Agreements.
2. Additional Consideration in favour of Cedes
The Parties acknowledge, recognize and accept that - due to a typing
mistake - under Article 3.3.2 of the Agreement executed between Cedes and
Asa International the number of shares of ASA Common Stock has been
erroneously indicated in 50,000 (fifty-thousand), rather than in the
correct figure of 100,000 (one hundred thousand). Accordingly, Article
3.3.2 of the Agreement executed between Cedes and Asa International shall
read as follows:
If, for the year ending December 31, 1998, the aggregate pre-tax profits of
ASA Italy related to the Business and to the business of SIPI-U (which
Purchaser is purchasing from SIPI-U through a separate contract), computed
in accordance with the methods used by Purchaser for reporting its results
of operations to the U.S. Securities and Exchange Commission, equal or
exceed 750,000,000 Italian Liras, then ASA International shall issue to
Seller an additional 100,000 (one hundred thousand) shares of ASA Inter
national Common Stock, promptly after the publication of such results.
3. Deeds of Transfers
The text of the Deeds of Transfer enclosed to the Agreements as Exhibits
7.3 has been completed and partially amended upon mutual agreement of the
Parties. The text of the new Deeds of Transfer which are executed and
notarized as of the date hereof by and between Asa Italy on the one part
and, respectively, Cedes and SIPI-U on the other part, are herewith
enclosed as Exhibit 3.
4. Lease Agreement relevant to Milan Offices of Cedes
The Parties have mutually agreed to exclude from the Business Contracts to
be transferred to Asa Italy the Lease Agreement concerning certain office
spaces located in Cinisiello Balsama (Milan), which Cedes is currently part
to. Accordingly, all rights and liabilities arising out from such Lease
Agreement [which was identified as ISOIL in Exhibit 2.2(i)(c) to the
Agreement between Cedes and ASA International] shall remain with Cedes.
5. Insurance Contracts
Contrary to what is provided for under Article 2.3(i)(d) of the Agreements,
the Parties have agreed that the insurance contracts (which Sellers are
part to) relevant to the insurance policies listed in Exhibit 5. Hereto
shall be transferred from Sellers to Purchaser as from the Effective Date.
As consequence of the above mentioned transfer, Purchaser shall be
responsible of any future payment due to the insurance companies listed in,
and shall reimburse (within January 31, 1998) to each Seller the amounts
respectively specified under column Premiums to be Reimbursed to Sellers
of, Exhibit 5 hereto (amounts which pertain to insurance premiums related
to periods extending after the Effective Date, already paid for by
Sellers).
6. Immobilizzazioni Immateriali Nette - Value Rectification
The Parties have agreed to rectify the value of the so-called
Immobilizzazioni Immateriali Nette reported in the Reference Date Financial
Statements enclosed as Exhibit 3.1.1 to both the Agreements. In particular,
such rectification consists of (i) the reduction of the value of the
Immobilizzazioni Immateriali Nette relevant to Cedes from Itl. 29,000,000
to Itl. 1,000,000; and (ii) the reduction of the value of the
Immobilizzazioni Immateriali Nette relevant to SIPI-U from Itl. 32,000,000
to Itl. 1,000,000 . Accordingly, with respect to the Immobilizzazioni
Immateriali Nette the value of Itl. 1,000,000 shall be indicated in the
Effective Date Financial Statements relevant to both Cedes and SIPI-U and
the above mentioned reduction shall be taken into proper account to the
extent of calculating any possible price adjustments and of determining the
Final Purchase Price, pursuant to the provisions of Article 3.2 of the
Agreements.
7. Joint Press Release
The Parties have agreed to distribute to the local newspapers and to the
national and, if the case, international, press agencies a joint press
release, whose text is herewith enclosed as Exhibit 7.
7. No Other Changes
All other terms and provisions of the Agreements remain unchanged and will
continue to apply and be in fore.
If you agree on the contents of the above Addendum please have it re-typed and
sent back to us duly initialized and signed in order to express your acceptance.
ASA International Ltd.
Mr. Alfred C. Angelone
(Chief Executive Officer)
/s/ Alfred C. Angelone
Cedes Associates S.r.l.
Mr. Alfred C. Angelone
(President)
/s/ Alfred C. Angelone
UNQUOTE
Yours Sincerely
CEDES S.r.l.
Mr. /s/ Alfonse Ostinelli
Title: Procuratore Speciale
SIPI-U S.r.l.
Mr. /s/ Alfonse Ostinelli
Title: Procuratore Speciale
<PAGE>
EXHIBIT 3.
TO THE ADDENDUM TO THE AGREEMENTS
DATED JANUARY 13, 1998
REVISED TEXT OF THE DEEDS OF TRANSFERS
EXHIBIT E-4-1
WHEREAS
A. The SELLER is a company active in the data processing field and is the
owner of assets (hereinafter he "Company") organized for the creation,
marketing and maintenance of software programmes, as specified in the
enclosures attached to this agreement (hereinafter the "Agreement");
B. The PURCHASER is a company active in the data processing field;
C. The SELLER intends to transfer the Company to the PURCHASER, who is
willing to purchase, pursuant to the terms and conditions set forth in this
Agreement (which represent the mere, partial, execution of part of the
agreements previously made between the Parties)
THE ABOVE BEING STATED
The Parties hereby agree as follows
1. SUBJECT OF THE AGREEMENT
1.1 In accordance with the terms and conditions of this Agreement, the
SELLER transfers and sells to the PURCHASER, who purchases, the Company as
described in this Clause "Subject of the Agreement" and in the Enclosures
mentioned therein.
1.2 The Company includes the assets and liabilities indicated in the
patrimonial situation enclosed to this Agreement as Enclosure 1.2 updated
to 30 September, 1997 (hereinafter the "Reference Date") and in the
relevant enclosures (hereinafter the "Provisional Patrimonial Situation"),
as successively updated to 31 December, 1997 (hereinafter the "Transferral
Date").
1.3 In compliance with the provisions of the previous Clause, the Parties
undertake to jointly prepare, within 31 March, 1998, a new patrimonial
situation relevant to the Company, updated to the Transferral Date
(hereinafter the "Updated Patrimonial Situation"). Attached to the Updated
Patrimonial Situation will be a series of enclosures which describe the
individual assets and liabilities which, upon the execution of this
Agreement, will be intended as transferred by the SELLER to the PURCHASER.
1.4 The Parties agree that for the purpose of preparing the Updated
Patrimonial Situation no amendment or adjustment will be made to the values
given in the Provisional Patrimonial Situation under the items (i) Fixed
Assets; (ii) Intellectual Property Rights; and (iii)_ Risks and Fees Fund.
The Parties have also agreed to conventionally fix (on the basis of the
evaluations and estimates made) as Itl. 417,762,500 the value of the
Start-up of the Company (which is not included in the items of the
Provisiona l Patrimonial Situation) and not to subject such element to any
value adjustment.
2. VALIDITY OF THE AGREEMENT
2.1 This Agreement will become valid as of 00.01 a.m. of 1 January 1998, as
of such date all of the assets and liabilities which are the subject of
this transfer (as for every risk pertinent to the Company), will be
intended as transferred by the SELLER to the PURCHASER.
3. PAYMENT
3.1 The payment due by the PURCHASER to the SELLER for the transfer of the
Company, as determined on the basis of the Preliminary Patrimonial
Situation attached hereto, is established as Itl. 442,762,500 (hereinafter
the "Payment").
3.2 The Payment has been determined by adding together the patrimonial
value of the assets and liabilities transferred with the Company (equal, as
of the Reference Date, to Itl. 25,000,000) and the conventional value
attributed to the item Start-up, equal to Itl. 417,762,500.
3.3 The Parties undertake to make (and to cooperate in such way) - as far
as possible - the patrimonial value of the assets and liabilities
transferred with the Company at the Transferral Date, identical to that
which results at the Reference Date, on the basis of the Preliminary
Patrimonial Situation attached hereto (i.e. Itl. 25,000,000). It is
furthermore agreed that only in the case in which the patrimonial value
ascertained at the Transferral Date (on the basis of the Updated
Patrimonial Situation) r esults as being higher than Itl. 26,000,000 or
lower than Itl. 24,000,000, such value will be re-established as Itl.
25,000,000, by means of the payment of an amount equal to the difference
(i) between the patrimonial value ascertained at the Transferral Date and
the amount of Itl. 25,000,000 (if the patrimonial value at the Transferral
Date results as higher than the patrimonial value at the Reference Date) or
(ii) between Itl. 25,000,000 and the patrimonial value ascertained at the
Transferal Date (if th e patrimonial value at the Transferral Date results
as being lower than Itl. 24,000,000) (hereinafter the "Difference"). The
Difference - which will be paid by the SELLER to the PURCHASER, if the
patrimonial value of the Company at the Transferral Date results as being
lower than Itl. 24,000,000; or by the PURCHASER to the SELLER, if the
patrimonial value of the Company at the Transferral Date results as being
higher than Itl. 26,000,000 - will be paid in cash or, if still possible,
by means of cancelling some credits or some debits of the transferred
assets. In the case in which the patrimonial value as of the Transferral
Date (on the basis of the Updated Patrimonial Situation) results as being
between Itl. 26,000,000 and Itl. 24,000,000, the transferral price of the
Company will not be subject to any amendment.
4. TERMS AND MEANS OF PAYMENT
4.1 The Payment will be paid today by the PURCHASER to the SELLER, by means
of banker's drafts for Itl. 25,000,000 and, for the remaining amount, by
means of the proprietary transfer to the SELLER of 100,000 ASA
International Shares (with registered office in Framingham in the State of
Massachusetts (USA), at no. 10 Speen Street) quoted on the American Stock
Exchange as NASDAQ (proprietary transfer which the PURCHASER undertakes to
ensure that it is effected in favour of the SELLER directly by ASA Interna
tional Ltd., by means of the issuance of 100,000 new shares of the
company).
5. REGISTRATION TAX AND COSTS
5.1 The Parties hereby give notice that this Agreement is subject to a
registration tax in proportion to the Payment and declare that the Company
does not include any immovable properties.
5.2 The Parties agree that the registration tax due in accordance with the
law, will be equally divided between the SELLER and the PURCHASER. All
other costs (notary fees, deposit of deeds, etc.) however connected to the
transfer of the Company will, instead, be the whole charge of the
PURCHASER, who will directly provide for the fulfilment of the relevant
costs and undertakes, in any case, to reimburse the SELLER, if the latter
directly bears any or part of the costs.
5.3 This Agreement will be liable to registration pursuant and in
fulfilment of Clause 35 (provisional liquidation) of the Stature on
Registration Tax mentioned in President of The Republic's Decree No. 131 of
26.4.1986. As soon as the Payment is definitely determined and, in the case
in which it results as different to that indicated in Clause 3.1 of this
Agreement, the Parties will provide for every consequent fulfilment in
accordance with the law.
6. ARBITRATION
6.1 The Parties hereto shall endeavour to settle amicably any dispute
arising from the interpretation, performance or termination of this
Agreement.
6.2 Any eventual dispute arising from the interpretation, performance or
termination of this Agreement, which is not settled amicably, shall be
brought before a Board of Arbitrators composed of 3 (three) members. The
arbitration procedure shall be carried out in compliance with the
provisions of the (Paris) ICC Rules on Conciliation and Arbitration, in
force at such time.
6.3 Each party shall designate its Arbitrator, the Plaintiff in its request
for arbitration and the Defendant in its reply to the request; the third
Arbitrator, who shall be Chairman of the Board, shall be appointed by the 2
(two) arbitrators appointed by the Parties. In the case that the Defendant
fails to designate its Arbitrator within 20 (twenty) days from receipt of
the request for arbitration containing the name of the Plaintiff's
arbitrator and/or the Arbitrators appointed by the Parties fail to re ach
an agreement on the designation of the third Arbitrator within 20 (twenty)
days from the appointment of the Defendant's Arbitrator, then the
Arbitrator or the missing Arbitrators shall be designated by the Chairman
of the Court of Arbitration of the International Chamber of Commerce of
Paris, upon the Parties' request.
6.4 Arbitration shall take place in London and shall be conducted in the
English language. The Arbitrators shall render their award within 180 (one
hundred and eighty) days from the date on which they have accepted their
appointment.
6.5 In the case in which any dispute arises between the Parties in respect
of the rendering or interpretation of the Arbitrators award or, however, in
respect of this Agreement (which, in the latter case, does not come under
the competence of the Board of Arbitrators), will be exclusively subject to
the Court of Padua.
7. FINAL PROVISIONS
7.1 The above Clauses and the Enclosures attached hereto form an integral
part of this Agreement.
7.2 Any amendment or addition to this Agreement which may be mutually
agreed between the Parties may only be made in writing.
Padua, 13 January, 1998
SIPI-U S.r.l.
Mr. Alfonso Ostinelli
Special attorney of the Company
---------------------------
CEDES ASSOCIATES S.r.l.
Mr. Alfred Angelone
Chairman and Legal representative of the Company
----------------------------
<PAGE>
DEED OF TRANSFER OF THE BUSINESS
between
SIPI-U S.r.l., with registered office in Via Leopardi no. 126, Udine,
represented by Mr. Alfonso Ostinelli, special attorney of the Company
(pursuant to the power of attorney issued in his favour on --------
exhibit no.----------- of the Notary Public Carlo Busi in Padua)
(hereinafter the "SELLER")
and
CEDES ASSOCIATES S.r.l., with registered office in Viale dell'Industria
no. 32, Padua, represented by Mr. Alfred Angelone, Chairman and legal
representative of the Company
(hereinafter the "PURCHASER")
EXHIBIT E-4-2
WHEREAS
A. The SELLER is a company active in the data processing field and is the
owner of assets (hereinafter the "Company") organized for the creation,
marketing and maintenance of software programmes, as specified in the
enclosures attached to this agreement (hereinafter the "Agreement");
B. The PURCHASER is a company active in the data processing field;
C. The SELLER intends to transfer the Company to the PURCHASER, who is
willing to purchase, pursuant to the terms and conditions set forth in this
Agreement (which represent the mere, partial, execution of part of the
agreements previously made between the Parties)
THE ABOVE BEING STATED
The Parties hereby agree as follows
1. SUBJECT OF THE AGREEMENT
1.1 In accordance with the terms and conditions of this Agreement, the
SELLER transfers and sells to the PURCHASER, who purchases, the Company as
described in this Clause "Subject of the Agreement" and in the Enclosures
mentioned therein.
1.2 The Company includes the assets and liabilities indicated in the
patrimonial situation enclosed to this Agreement as Enclosure 1.2 updated
to 30 September, 1997 (hereinafter the "Reference Date") and in the
relevant enclosures (hereinafter the "Provisional Patrimonial Situation"),
as successively updated to 31 December, 1997 (hereinafter the "Transferral
Date").
1.3 In compliance with the provisions of the previous Clause, the Parties
undertake to jointly prepare, within 31 March, 1998, a new patrimonial
situation relevant to the Company, updated to the Transferral Date
(hereinafter the "Updated Patrimonial Situation"). Attached to the Updated
Patrimonial Situation will be a series of enclosures which describe the
individual assets and liabilities which, upon the execution of this
Agreement, will be intended as transferred by the SELLER to the PURCHASER.
1.4 The Parties agree that for the purpose of preparing the Updated
Patrimonial Situation no amendment or adjustment will be made to the values
given in the Provisional Patrimonial Situation under the items (i) Fixed
Assets; (ii) Intellectual Property Rights; and (iii)_ Risks and Fees Fund.
The Parties have also agreed to conventionally fix (on the basis of the
evaluations and estimates made) as Itl. 417,762,500 the value of the
Start-up of the Company (which is not included in the items of the
Provisiona l Patrimonial Situation) and not to subject such element to any
value adjustment.
2. VALIDITY OF THE AGREEMENT
2.1 This Agreement will become valid as of 00.01 a.m. of 1 January 1998, as
of such date all of the assets and liabilities which are the subject of
this transfer (as for every risk pertinent to the Company), will be
intended as transferred by the SELLER to the PURCHASER.
3. PAYMENT
3.1 The payment due by the PURCHASER to the SELLER for the transfer of the
Company, as determined on the basis of the Preliminary Patrimonial
Situation attached hereto, is established as Itl. 443,762,500 (hereinafter
the "Payment").
3.2 The Payment has been determined by adding together the patrimonial
value of the assets and liabilities transferred with the Company (equal, as
of the Reference Date, to Itl. 26,000,000) and the conventional value
attributed to the item Start-up, equal to Itl. 417,762,500.
3.3 The Parties undertake to make (and to cooperate in such way) - as far
as possible - the patrimonial value of the assets and liabilities
transferred with the Company at the Transferral Date, identical to that
which results at the Reference Date, on the basis of the Preliminary
Patrimonial Situation attached hereto (i.e. Itl. 26,000,000). It is
furthermore agreed that only in the case in which the patrimonial value
ascertained at the Transferral Date (on the basis of the Updated
Patrimonial Situation) r esults as being higher than Itl. 26,000,000 or
lower than Itl. 24,000,000, such value will be re-established as Itl.
26,000,000, by means of the payment of an amount equal to the difference
(i) between the patrimonial value ascertained at the Transferral Date and
the amount of Itl. 26,000,000 (if the patrimonial value at the Transferral
Date results as higher than the patrimonial value at the Reference Date) or
(ii) between Itl. 26,000,000 and the patrimonial value ascertained at the
Transferal Date (if th e patrimonial value at the Transferral Date results
as being lower than Itl. 24,000,000) (hereinafter the "Difference"). The
Difference - which will be paid by the SELLER to the PURCHASER, if the
patrimonial value of the Company at the Transferral Date results as being
lower than Itl. 24,000,000; or by the PURCHASER to the SELLER, if the
patrimonial value of the Company at the Transferral Date results as being
higher than Itl. 26,000,000 - will be paid in cash or, if still possible,
by means of cancelling some credits or some debits of the transferred
assets. In the case in which the patrimonial value as of the Transferral
Date (on the basis of the Updated Patrimonial Situation) results as being
between Itl. 26,000,000 and Itl. 24,000,000, the transferral price of the
Company will not be subject to any amendment.
3.4 It is finally agreed that, whenever during the course of 1998, with
reference to the activity carried out by the Company and the company unit
of SIPI-U S.r.l., with registered office in Udine, Via Leopardi 126
(company unit that the PURCHASER had purchased from SIPI-U through separate
contractual agreements), the PURCHASER should make a profit (calculated
prior to applying the relevant taxes) equal or exceeding the amount of Itl.
750,000,000, the aforementioned Payment due to the SELLER will be increa
sed by an amount equal to the market value of 100,000 ordinary shares of
ASA INTERNATIONAL LTD (with registered office in Framingham in the State of
Massachusetts-USA-, at 10 Speen Street) quoted on the American Stock
Exchange as NASDAQ (hereinafter the "ASA International Shares").
4. TERMS AND MEANS OF PAYMENT
4.1 The Payment will be paid today by the PURCHASER to the SELLER, by means
of banker's drafts for Itl. 25,000,000 and, for the remaining amount, by
means of the proprietary transfer to the SELLER of 100,000 ASA
International Shares (proprietary transfer which the PURCHASER undertakes
to ensure that it is effected in favour of the SELLER directly by ASA
International Ltd., by means of the issuance of 100,000 new shares of the
company).
4.2 Where necessary, pursuant to and to fulfill what is established in
Clause 3.4 above, the additional quota of Payment will be paid by the
PURCHASER to the SELLER - by means of the proprietary transfer by the
PURCHASER of a further (in respect of what is established in Clause 4.1
above) 100,000 ASA International Shares. If necessary, such transferral
will be made as soon as the details concerning the PURCHASER's 1998 Balance
Sheet are available and, in any case, no later than 30 June 1999.
5. REGISTRATION TAX AND COSTS
5.1 The Parties hereby give notice that this Agreement is subject to a
registration tax in proportion to the Payment and declare that the Company
does not include any immovable properties.
5.2 The Parties agree that the registration tax due in accordance with the
law, will be equally divided between the SELLER and the PURCHASER. All
other costs (notary fees, deposit of deeds, etc.) however connected to the
transfer of the Company will, instead, be the whole charge of the
PURCHASER, who will directly provide for the fulfilment of the relevant
costs and undertakes, in any case, to reimburse the SELLER, if the latter
directly bears any or part of the costs.
5.3 This Agreement will be liable to registration pursuant and in
fulfilment of Clause 35 (provisional liquidation) of the Stature on
Registration Tax mentioned in President of The Republic's Decree No. 131 of
26.4.1986. As soon as the Payment is definitely determined and, in the case
in which it results as different to that indicated in Clause 3.1 of this
Agreement, the Parties will provide for every consequent fulfilment in
accordance with the law.
6. ARBITRATION
6.1 The Parties hereto shall endeavour to settle amicably any dispute
arising from the interpretation, performance or termination of this
Agreement.
6.2 Any eventual dispute arising from the interpretation, performance or
termination of this Agreement, which is not settled amicably, shall be
brought before a Board of Arbitrators composed of 3 (three) members. The
arbitration procedure shall be carried out in compliance with the
provisions of the (Paris) ICC Rules on Conciliation and Arbitration, in
force at such time.
6.3 Each party shall designate its Arbitrator, the Plaintiff in its request
for arbitration and the Defendant in its reply to the request; the third
Arbitrator, who shall be Chairman of the Board, shall be appointed by the 2
(two) arbitrators appointed by the Parties. In the case that the Defendant
fails to designate its Arbitrator within 20 (twenty) days from receipt of
the request for arbitration containing the name of the Plaintiff's
arbitrator and/or the Arbitrators appointed by the Parties fail to re ach
an agreement on the designation of the third Arbitrator within 20 (twenty)
days from the appointment of the Defendant's Arbitrator, then the
Arbitrator or the missing Arbitrators shall be designated by the Chairman
of the Court of Arbitration of the International Chamber of Commerce of
Paris, upon the Parties' request.
6.4 Arbitration shall take place in London and shall be conducted in the
English language. The Arbitrators shall render their award within 180 (one
hundred and eighty) days from the date on which they have accepted their
appointment.
6.5 In the case in which any dispute arises between the Parties in respect
of the rendering or interpretation of the Arbitrators award or, however, in
respect of this Agreement (which, in the latter case, does not come under
the competence of the Board of Arbitrators), will be exclusively subject to
the Court of Padua.
7. FINAL PROVISIONS
7.1 The above Clauses and the Enclosures attached hereto form an integral
part of this Agreement.
7.2 Any amendment or addition to this Agreement which may be mutually
agreed between the Parties may only be made in writing.
Padua, 13 January, 1998
CEDES S.r.l.
Mr. Alfonso Ostinelli
Special attorney of the Company
------------------------------
CEDES ASSOCIATES S.r.l.
Mr. Alfred Angelone
Chairman and Legal representative of the Company
------------------------------
<PAGE>
DEED OF TRANSFER OF THE BUSINESS
between
SIPI-U S.r.l., with registered office in Via Leopardi no. 126, Udine,
represented by Mr. Alfonso Ostinelli, special attorney of the Company
(pursuant to the power of attorney issued in his favour on ------- exhibit
no. --------- of the Notary Public Carlo Busi in Padua)
(hereinafter the "SELLER")
and
CEDES ASSOCIATES S.r.l., with registered office in Viale dell'Industria
no. 32, Padua, represented by Mr. Alfred Angelone, Chairman and legal
representative of the Company
(hereinafter the "PURCHASER")
