{"id":43273,"date":"2015-09-17T11:25:58","date_gmt":"2015-09-17T16:25:58","guid":{"rendered":"https:\/\/content.findlaw-admin.com\/ability-legal\/contracts\/uncategorized\/asset-purchase-agreement-accrue-software-inc-and-tantau.html"},"modified":"2015-09-17T11:25:58","modified_gmt":"2015-09-17T16:25:58","slug":"asset-purchase-agreement-accrue-software-inc-and-tantau","status":"publish","type":"corporate_contracts","link":"https:\/\/corporate.findlaw.com\/contracts\/planning\/asset-purchase-agreement-accrue-software-inc-and-tantau.html","title":{"rendered":"Asset Purchase Agreement &#8211; Accrue Software Inc. and Tantau Software Inc."},"content":{"rendered":"<pre>                            ASSET PURCHASE AGREEMENT\n\n\n        This Asset Purchase Agreement (the \"Agreement\") is entered into as of\nJune 30, 2000, by and between Accrue Software, Inc., a Delaware corporation\n(\"Buyer\"), Tantau Software, Inc., a Delaware corporation (\"Seller\") and Tantau\nSoftware International, Inc. a Delaware corporation and a wholly owned\nsubsidiary of Seller (\"Seller Sub\").\n\n                                    RECITALS\n\n        Buyer is in the business of developing and marketing Internet data\ncollection and analysis software. Among Seller's various business activities,\nSeller's Infocharger division (the \"Business\") develops and markets a high\nperformance Internet data analysis software tool. Buyer desires to acquire from\nSeller, and Seller desires to sell to Buyer, substantially all of the assets of\nthe Business on the terms and subject to the conditions set forth in this\nAgreement.\n\n                                    AGREEMENT\n\n        In consideration of the mutual agreements, representations, warranties\nand covenants set forth below, Buyer, Seller and Seller Sub agree as follows:\n\n1. DEFINITIONS.\n\n        1.1 DEFINITIONS. As used in this Agreement, the following terms shall\nhave the following meanings:\n\n                (a) \"AFFILIATE\" means with respect to any Person, a Person\ndirectly or indirectly controlling or controlled by or under common control with\nsuch Person.\n\n                (b) \"CLOSING\" means the consummation of the transactions\ncontemplated hereby.\n\n                (c) \"CLOSING DATE\" means the date of the Closing.\n\n                (d) \"CODE\" means the Internal Revenue Code of 1986, as amended.\n\n                (e) \"EMPLOYEES\" means the current employees of Seller or Seller\nSub to whom Buyer will make offers to commence employment with Buyer as of the\nClosing and who are listed on Exhibit E.\n\n                (f) \"GAAP\" means generally accepted accounting principles of the\nUnited States as set forth by the Financial Accounting Standards Board.\n\n   2\n\n                (g) \"GOVERNMENTAL AUTHORIZATIONS\" means the permits,\nauthorizations, consents or approvals of any Governmental Entity which are a\ncondition to the lawful consummation of the transactions contemplated hereby\nlisted on Schedule 2.1(k) to this Agreement.\n\n                (h) \"GOVERNMENTAL ENTITY\" means any court, or any federal,\nstate, municipal or other governmental authority, department, commission, board,\nagency or other instrumentality (domestic or foreign).\n\n                (i) \"LIEN\" means any mortgage, pledge, lien, security interest,\noption, covenant, condition, restriction, encumbrance, charge or other\nthird-party claim of any kind.\n\n                (j) \"MATERIAL ADVERSE EFFECT\" with respect to a Person means any\nevent, change or effect that is materially adverse to the condition (financial\nor otherwise), properties, assets, liabilities, business, operations, results of\noperations, or prospects of such Person and its Affiliates, taken as a whole.\n\n                (k) \"PERSON\" means an individual, corporation, partnership,\nassociation, trust, government or political subdivision or agent or\ninstrumentality thereof, or other entity or organization.\n\n                (l) \"TAXES\" means all taxes, however denominated, including any\ninterest, penalties or other additions to tax that may become payable in respect\nthereof, (i) imposed by any federal, territorial, state, local or foreign\ngovernment or any agency or political subdivision of any such government, for\nwhich Buyer could become liable as successor to or transferee of the Business or\nthe Purchased Assets or which could become a charge against or lien on any of\nthe Purchased Assets, which taxes shall include, without limiting the generality\nof the foregoing, all sales and use taxes, ad valorem taxes, excise taxes,\nbusiness license taxes, occupation taxes, real and personal property taxes,\nstamp taxes, environmental taxes, real property gains taxes, transfer taxes,\npayroll and employee withholding taxes, unemployment insurance contributions,\nsocial security taxes, and other governmental charges, and other obligations of\nthe same or of a similar nature to any of the foregoing, which are required to\nbe paid, withheld or collected, or (ii) any liability for amounts referred to in\n(i) as a result of any obligations to indemnify another Person.\n\n2. SALE AND PURCHASE\n\n        2.1 TRANSFER OF ASSETS. Subject to the terms and conditions of this\nAgreement, Seller shall sell, assign, grant, transfer, and deliver (or cause to\nbe sold, assigned, granted, transferred and delivered) to Buyer, or to any\nAffiliate of Buyer designated by Buyer, and Buyer shall purchase and accept from\nSeller as of the Closing Date, free and clear of all Liens other than Liens\nimposed or arising under the Assumed Liabilities, all of the Seller's rights,\ntitle and interest, including all intellectual property rights, in and to all of\nthe following assets and properties and business as the same shall exist on the\nClosing Date (the \"Purchased Assets\"):\n\n                (a) all real property and leases of and other interests in real\nproperty, in each case together with all buildings, fixtures and improvements\nthereon listed on Schedule 2.1(a);\n\n\n                                      -2-\n   3\n\n                (b) all tangible personal property and leases of and other\ninterests in tangible personal property used in connection with the Business,\nincluding, without limitation, the items listed on Schedule 2.1(b);\n\n                (c) all rights in connection with the Business under the\ncontracts, agreements, licenses, commitments, sales and purchase orders and\nother instruments listed on Schedule 2.1(c) and the leases of real and personal\nproperty and contracts relating thereto described in subsections (a) and (b)\nabove (the \"Contracts\");\n\n                (d) all raw materials, work-in-process, finished goods, supplies\nand other inventories of the Business (the \"Inventories\");\n\n                (e) all accounts receivable, notes receivable and other\nreceivables arising from the Business;\n\n                (f) all prepaid expenses relating to the operation of the\nBusiness including, but not limited to Taxes, leases and rentals;\n\n                (g) all of Seller's rights, claims, credits, causes of action or\nrights of set-off against third parties relating to the Purchased Assets,\nincluding, without limitation, unliquidated rights under warranties;\n\n                (h) all of Seller's rights, title and interest in and to the\ncopyrights, copyright registrations, proprietary processes, trade secrets,\nlicense rights, specifications, technical manuals and data, drawings,\ninventions, designs, patents, patent applications, trade names, trademarks,\nservice marks, domain names, URL's, product information and data, know-how and\ndevelopment work-in-progress, customer lists, software, business and marketing\nplans and other intellectual or intangible property embodied in or pertaining to\nthe Business, whether pending, applied for or issued, whether filed in the\nUnited States or in other countries listed on Schedule 2.1(h);\n\n                (i) all things authored, discovered, developed, made, perfected,\nimproved, designed, engineered, acquired, produced, conceived or first reduced\nto practice by Seller or any of its employees or agents that are exclusively\nused by Seller in the conduct of the Business or developed by Seller exclusively\nfor use in the Business, in any stage of development, including, without\nlimitation, modifications, enhancements, designs, concepts, techniques, methods,\nideas, flow charts, coding sheets, notes and all other information relating to\nthe Business;\n\n                (j) any and all design and code documentation, methodologies,\nprocesses, trade secrets, copyrights, design information, product information,\ntechnology, formulae, routines, engineering specifications, technical manuals\nand data, drawings, inventions, know-how, techniques, engineering work papers,\nand notes, development work-in-process, and other proprietary information and\nmaterials of any kind used in or derived from the Purchased Assets (collectively\nwith subsections (h) and (i), the \"Intellectual Property\");\n\n\n                                      -3-\n   4\n\n                (k) all permits, authorizations, consents and approvals of any\nGovernmental Entity affecting or relating in any way to the Business and not\notherwise affecting or relating in any way to Seller's other business operations\nor activities, including without limitation, the items listed on Schedule 2.1(k)\n(the \"Permits\");\n\n                (l) all books, records files and papers, whether in hard copy or\nelectronic format, used in the Business, including without limitation,\nengineering information, sales and promotional literature, manuals and data,\nsales and purchase correspondence, lists of present, former and prospective\nsuppliers or customers, personnel and employment records, and any information\nrelating to Taxes imposed on the Business or Purchased Assets; and\n\n                (m) all goodwill associated with the Business or the Purchased\nAssets, together with the right to represent to third parties that Buyer is the\nsuccessor to the Business.\n\n        2.2 EXCLUDED ASSETS. Buyer agrees that notwithstanding any provision of\nSection 2.1 the assets of Seller which are not expressly covered by Section 2.1\nshall be excluded from the Purchased Assets, which excluded assets shall\ninclude, without limitation, the assets set forth on Schedule 2.2 hereto (the\n\"Excluded Assets\").\n\n        2.3 TRANSFER OF LIABILITIES. Subject to the terms and conditions of this\nAgreement, Buyer or an Affiliate of Buyer designated by Buyer agrees, effective\nas of the Closing Date, to assume the following liabilities (the \"Assumed\nLiabilities\").\n\n                (a) the liabilities set forth on Schedule 2.3(a) to the extent\nset forth thereon; and\n\n                (b) the liabilities and obligations of Seller arising under the\nContracts subsequent to the Closing Date, other than the liabilities\nattributable to any failure by Seller to comply with the terms thereof.\n\n        2.4 EXCLUDED LIABILITIES. Except for those liabilities expressly assumed\nby Buyer or any Affiliate designated by Buyer pursuant to Section 2.3, Buyer\nshall not assume and shall not be liable for, and Seller and its direct or\nindirect subsidiaries shall retain and remain solely liable for and obligated to\ndischarge, all of the debts, contracts, agreements, commitments, obligations and\nother liabilities of any nature whatsoever of Seller and its direct and indirect\nsubsidiaries, whether known or unknown, accrued or not accrued, fixed or\ncontingent, and whether or not relating to or arising from the Business or the\nPurchased Assets, including without limitation, the following:\n\n                (a) Any liability for breaches by Seller or any of its\nrespective direct or indirect subsidiaries of any instrument, contract or\npurchase order (including any Contract) or any liability for payments or amounts\ndue under any instrument, contract or purchase order (excluding any Contract) or\nany liability for payments or amounts due under any Contract prior to the\nClosing Date;\n\n\n                                      -4-\n   5\n\n                (b) Any liability or obligation for Taxes attributable to or\nimposed upon Seller or any of its direct or indirect subsidiaries, or\nattributable to or imposed upon the Purchased Assets for any period (or portion\nthereof) through the Closing Date, including, without limitation, any Taxes\npayable by Seller that are attributable to or arise from the transactions\ncontemplated by this Agreement;\n\n                (c) Any liability or obligation for or in respect of any loan,\nother indebtedness for money borrowed, or account payable of Seller or any of\nits direct or indirect subsidiaries, including any such liabilities owed to\nAffiliates of Seller;\n\n                (d) Any liability or obligation arising as a result of any legal\nor equitable action or judicial or administrative proceeding initiated at any\ntime, to the extent relating to any action or omission on or prior to the\nClosing Date by or on behalf of Seller or any of its direct or indirect\nsubsidiaries, including, without limitation, any liability for infringement of\nintellectual property rights, breach of product warranty, injury or death caused\nby products, or violations of federal or state securities or other laws;\n\n                (e) Any liability or obligation arising on or prior to the\nClosing Date out of any \"employee benefit plan,\" as such term is defined by the\nEmployee Retirement Income Security Act of 1974 (\"ERISA\") or other employee\nbenefit plans maintained or offered by Seller or any of its direct or indirect\nsubsidiaries for the benefit of Seller's or Seller Sub's employees;\n\n                (f) Any liability or obligation for making payments of any kind\n(including as a result of the sale of Purchased Assets or as a result of the\ntermination of employment by Seller of employees, or other claims arising out of\nthe terms and conditions of employment with Seller, or for vacation or severance\npay or otherwise) to employees of Seller and Seller Sub or in respect of payroll\ntaxes for employees of Seller and Seller Sub;\n\n                (g) Any liability of Seller or any of its direct or indirect\nsubsidiaries incurred in connection with the making or performance of this\nAgreement and the transactions contemplated hereby;\n\n                (h) Any liability of Seller or any of its direct or indirect\nsubsidiaries arising out of the violation of or failure to comply with any\nEnvironmental Regulations (as hereinafter defined) applicable to any aspect of\nthe Business as operated by Seller prior to the Closing Date; and\n\n                (i) Any costs or expenses of Seller or any of its direct or\nindirect subsidiaries incurred in connection with shutting down, deinstalling\nand removing equipment not purchased by Buyer, and the costs associated with all\ncontracts and agreements not assumed by Buyer.\n\n        2.5 PURCHASE PRICE. Subject to the performance by Seller and Seller Sub\nof all of their respective obligations under this Agreement (including\ndelivering all documents required to be delivered) at the Closing, in\nconsideration of the acquisition of the Purchased Assets under Section 2.1,\nBuyer agrees (a) to deliver to Seller or an account or accounts designated by\nSeller 1,431,945 shares, $0.001 par value, of Buyer's Common Stock (the\n\"Immediate Consideration\");\n\n\n                                      -5-\n   6\n\n(b) to deliver to Depository Agent (the \"Depository Agent\") or an account or\naccounts designated by Depository Agent 234,722 shares, $0.001 par value, of\nBuyer's Common Stock (the \"Escrow Consideration\" and together with the Immediate\nConsideration, the \"Purchase Price\"), which consideration shall be subject to\nthe provisions of the Depository Agreement attached as Exhibit A to this\nAgreement; and (c) to assume the Assumed Liabilities. The 1,431,945 shares of\nCommon Stock comprising the Immediate Consideration and the 234,722 shares of\nCommon Stock comprising the Escrow Consideration may also hereinafter be\nreferred to collectively as the \"Securities\" or \"Total Shares.\"\n\n        2.6 ALLOCATION OF PURCHASE PRICE. The Purchase Price shall be allocated\namong the Purchased Assets as provided in Exhibit B for purposes of complying\nwith the requirements of Section 1060 of the Code and the regulations\nthereunder. Buyer and Seller agree to each prepare and file on a timely basis\nwith the Internal Revenue Service (and applicable state tax authorities)\nsubstantially identical and supplemental Internal Revenue Service Forms 8594\n(and corresponding state tax forms) consistent with Buyer's allocation of the\nPurchase Price. If any Tax authority challenges such allocation, the party\nreceiving notice of such challenge shall give the other prompt written notice\nthereof and the parties shall cooperate in order to preserve the effectiveness\nof such allocation.\n\n3. CLOSING.\n\n        3.1 CLOSING. Subject to the terms and conditions of this Agreement, the\nClosing shall take place on such date, as soon as practicable after all\nconditions precedent in Sections 9 and 10 have been satisfied or waived, as the\nparties may agree, but in any case, no later than July 15, 2000 (the \"Closing\nDate\").\n\n        3.2 ACTIONS AT THE CLOSING. At the Closing, Seller and Seller Sub shall\ndeliver the Purchased Assets to Buyer, Buyer shall deliver the Immediate\nConsideration to Seller and deliver the Escrow Consideration to the Depository\nAgent, and Buyer and Seller shall take such actions and execute and deliver such\nagreements, bills of sale, and other instruments and documents as necessary or\nappropriate to effect the transactions contemplated by this Agreement in\naccordance with its terms, including without limitation the following:\n\n                (a) BILL OF SALE; ASSIGNMENT AND ASSUMPTION AGREEMENT. Seller\nand Seller Sub shall deliver to Buyer a general Bill of Sale substantially in\nthe form attached as Exhibit C and with respect to each Contract, Permit or item\nof Intellectual Property, an Assignment and Assumption Agreement substantially\nin the form attached as Exhibit D (collectively, the \"Transfer Documents\") in\neach case duly executed by Seller and Seller Sub, and in the aggregate assigning\nto Buyer all of Seller's and Seller Sub's right, title and interest, including\nall intellectual property rights, in and to the Purchased Assets free and clear\nof all Liens. Buyer may designate one or more of its Affiliates as the recipient\nof certain of the Purchased Assets, and as the party to assume certain of the\nAssumed Liabilities, in which case Seller shall transfer such Purchased Assets\nand Assumed Liabilities to Buyer or the Affiliate(s) designated by Buyer\npursuant to such Transfer Documents.\n\n\n                                      -6-\n   7\n\n                (b) PURCHASE PRICE. Buyer shall deliver the Immediate\nConsideration to Seller and the Escrow Consideration to the Depository Agent and\nshall execute the Assignment and Assumption Agreement.\n\n                (c) TITLE. Seller and Seller Sub shall provide reasonable\nevidence of valid title to such of the Purchased Assets as Buyer may reasonably\nrequest in writing prior to the Closing, in form and substance reasonably\nsatisfactory to Buyer.\n\n                (d) THIRD PARTY CONSENTS AND ASSIGNMENTS. Seller and Seller Sub\nshall deliver to Buyer any assignments, and any required consents to assignment,\nthat it has obtained in respect of the Contracts, duly executed by parties\nhaving the authority to so assign or consent to assign, in form and substance as\nBuyer shall reasonably request, as well as a written confirmation from such\nthird parties that the Contracts are in good standing.\n\n                (e) SELLER DOCUMENTS. At the Closing, Seller and Seller Sub\nshall deliver to Buyer any and all documents required to satisfy the conditions\nset forth in Section 10 of this Agreement and any other closing documents\nreasonably requested by Buyer.\n\n                (f) BUYER DOCUMENTS. At the Closing, Buyer shall deliver to\nSeller and Seller Sub any and all documents required to satisfy the conditions\nset forth in Section 9 of this Agreement and any other closing documents\nreasonably requested by Seller.\n\n                (g) POST-CLOSING ACTIONS. Subsequent to the Closing Date, Seller\nshall, and shall cause any Affiliate of Seller to, from time to time execute and\ndeliver, upon the request of Buyer, all such other and further materials and\ndocuments and instruments of conveyance, transfer or assignment as may\nreasonably be requested by Buyer to effect, record or verify the transfer to and\nvesting in Buyer of Seller's and any of Seller's Affiliates' right, title and\ninterest in and to the Purchased Assets, free and clear of all Liens in\naccordance with the terms of this Agreement.\n\n4. REPRESENTATIONS AND WARRANTIES OF SELLER\n\n        Each representation and warranty set forth below is qualified by any\nexception or disclosures set forth in the Seller Disclosure Schedule attached\nhereto, which exceptions specifically reference the Section(s) to be qualified.\nIn all other respects, each representation and warranty set out in this Section\n4 is not qualified in any way whatsoever, will not merge on Closing or by reason\nof the execution and delivery of any agreement, document or instrument at the\nClosing, will remain in force on and after the Closing Date, (although not\ndeemed to be given as of any date after the Closing Date), is given with the\nintention that liability is not confined to breaches discovered before Closing,\nis separate and independent and is not limited by reference to any other\nrepresentation or warranty or any other provision of this Agreement, and is made\nand given as of the date hereof with the intention of inducing the Buyer to\nenter into this Agreement. Seller represents and warrants to Buyer as follows:\n\n        4.1 ORGANIZATION, STANDING AND POWER. Seller and Seller Sub are\ncorporations duly organized, validly existing and in good standing under the\nlaws of the State of Delaware. Seller\n\n\n                                      -7-\n   8\n\nand Seller Sub have the requisite corporate power and authority and all\nnecessary permits, authorizations, consents, and approvals of all Governmental\nEntities to own, lease and operate their respective properties and to carry on\nthe Business as now being conducted, except where the failure to have such\npower, authority and governmental approvals would not, individually or in the\naggregate, have a Material Adverse Effect on the Purchased Assets or the\nBusiness. Seller and Seller Sub are duly qualified or licensed as foreign\ncorporations to do business, and are in good standing, in each jurisdiction\nwhere the character of the properties owned, leased or operated by each of them\nor the nature of their business makes such qualification or licensing necessary,\nexcept for failures to be so qualified or licensed and in good standing that\nwould not, individually or in the aggregate, have a Material Adverse Effect on\nthe Purchased Assets or the Business.\n\n        4.2 AUTHORITY. The execution and delivery of this Agreement (and all\nother agreements and instruments contemplated under this Agreement) by Seller\nand Seller Sub, the performance by Seller and Seller Sub of their respective\nobligations hereunder and thereunder, and the consummation by Seller and Seller\nSub of the transactions contemplated hereby and thereby have been duly\nauthorized by all necessary action by the respective Boards of Directors of\nSeller and Seller Sub, and no other act or proceeding on the part of or on\nbehalf of either Seller or Seller Sub is necessary to approve the execution and\ndelivery of this Agreement and such other agreements and instruments, the\nperformance by Seller and Seller Sub of their respective obligations hereunder\nand thereunder and the consummation of the transactions contemplated hereby and\nthereby. Seller represents that it will not be necessary to obtain the vote of\nits stockholders to approve this Agreement and the transactions contemplated\nhereby. The signatory officers of Seller and Seller Sub have the power and\nauthority to execute and deliver this Agreement and all of the other agreements\nand instruments to be executed and delivered by Seller and Seller Sub pursuant\nhereto, to consummate the transactions hereby and thereby contemplated and to\ntake all other actions required to be taken by Seller and Seller Sub pursuant to\nthe provisions hereof and thereof.\n\n        4.3 EXECUTION AND BINDING EFFECT. This Agreement has been duly and\nvalidly executed and delivered by Seller and Seller Sub and constitutes, and the\nother agreements and instruments to be executed and delivered by Seller and, as\napplicable, Seller Sub, pursuant hereto, upon their execution and delivery by\nSeller and Seller Sub, will constitute (assuming, in each case, the due and\nvalid authorization, execution and delivery thereof by Buyer), legal, valid and\nbinding agreements of Seller and Seller Sub, enforceable against Seller and\nSeller Sub in accordance with their respective terms, except as enforceability\nmay be limited by bankruptcy, insolvency, moratorium, or other laws affecting\nthe enforcement of creditors' rights generally or provisions limiting\ncompetition, and by equitable principles.\n\n        4.4 CONSENTS AND APPROVALS OF GOVERNMENTAL ENTITIES. Other than the\nGovernmental Authorizations there is no requirement applicable to Seller or\nSeller Sub to make any filing, declaration or registration with, or to obtain\nany permit, authorization, consent or approval of, any Governmental Entity as a\ncondition to the lawful consummation by Seller and Seller Sub of the\ntransactions contemplated by this Agreement and the other agreements and\n\n\n                                      -8-\n   9\n\ninstruments to be executed and delivered by Seller and Seller Sub pursuant\nhereto or the consummation by Seller and Seller Sub of the transactions\ncontemplated herein or therein.\n\n        4.5 NO VIOLATION. Neither the execution, delivery and performance of\nthis Agreement and all of the other agreements and instruments to be executed\nand delivered pursuant hereto, nor the consummation of the transactions\ncontemplated hereby or thereby, will, with or without the passage of time or the\ndelivery of notice or both, (a) conflict with, violate or result in any breach\nof the terms, conditions or provisions of the Certificate of Incorporation or\nBylaws of Seller or Seller Sub, (b) conflict with or result in a violation or\nbreach of, or constitute a default or require consent of any Person, except such\nconsents as have been obtained prior to the Closing Date, (or give rise to any\nright of termination, cancellation or acceleration) under any of the terms,\nconditions or provisions of any contract, notice, bond, mortgage, indenture,\nlicense, franchise, permit, agreement, lease or other instrument or obligation\nto which Seller or Seller Sub is a party or by which Seller, Seller Sub or any\nof the Purchased Assets may be bound, (c) violate any statute, ordinance or law\nor any rule, regulation, order, writ, injunction or decree of any Governmental\nEntity applicable to Seller or Seller Sub or by which any properties or assets\nof Seller or Seller Sub may be bound, or (d) result in any cancellation of, or\nobligation to repay, any grant, loan or other financial assistance received by\nSeller or Seller Sub from any Governmental Entity. No \"bulk sales\" legislation\napplies to the transactions contemplated by this Agreement.\n\n        4.6 CONSENTS. Schedule 4.6 sets forth each Contract requiring a consent\nas a result of the execution, delivery and performance of this Agreement or the\nconsummation of the transactions contemplated hereby (each a \"Required\nConsent\").\n\n        4.7 FINANCIAL INFORMATION. Seller has delivered to Buyer its unaudited\nbalance sheet at May 31, 2000 (the \"May 31 Balance Sheet\"), a copy of which is\nset forth in the Seller Disclosure Schedule. The monetary amounts for the\naccounts included in the May 31 Balance Sheet were prepared in accordance with\nGAAP. The May 31 Balance Sheet accurately and correctly discloses the amounts of\nthe Purchased Assets as of the Closing Date.\n\n        4.8 NO UNDISCLOSED LIABILITIES. The Business does not have any\nliability, indebtedness, obligation, expense, claim, deficiency, guaranty or\nendorsement of any type, in excess of $25,000 individually or $50,000 in the\naggregate, whether accrued, absolute, contingent, matured, unmatured or other\n(whether or not required by GAAP to be reflected in Seller's financial\nstatements) which (i) has not been reflected in the May 31 Balance Sheet, or\n(ii) has not arisen in the ordinary course of the Business since May 31, 2000.\n\n        4.9 ASSETS GENERALLY.\n\n                (a) The Purchased Assets include all properties, tangible and\nintangible, and only such properties, currently used by Seller and Seller Sub in\noperating the Business and necessary for Buyer to operate the Business after the\nClosing Date in a manner substantially equivalent to the manner in which Seller\nhas operated the Business prior to and through the Closing Date. Other than the\nRequired Consents and the Governmental Approvals, no licenses or other consents\nfrom, or payments to, any other Person are or will be necessary for Buyer to\n\n\n                                      -9-\n   10\n\noperate the Business and use the Purchased Assets in the manner in which Seller\nand Seller Sub have operated the same.\n\n                (b) Either Seller or Seller Sub holds good and marketable title,\nlicense to or leasehold interest in all of the Purchased Assets, free and clear\nof all Liens other than Liens imposed or arising under the Assumed Liabilities,\nand has the complete and unrestricted power and the unqualified right to sell,\nassign and deliver the Purchased Assets to Buyer. Upon consummation of the\ntransactions contemplated by this Agreement, Buyer will acquire good and\nmarketable title, license or leasehold interest to the Purchased Assets free and\nclear of any Liens, other than Liens imposed or arising under the Assumed\nLiabilities, and there exists no restriction on the use or transfer of the\nPurchased Assets, except as may be assumed hereunder by Buyer as an Assumed\nLiability. No Person other than Seller or Seller Sub have any right or interest\nin the Purchased Assets, including the right to grant interests in the Purchased\nAssets to third parties, except for Purchased Assets licensed or leased from\nthird parties which are set forth in the Seller Disclosure Schedule and\nidentified as such.\n\n                (c) None of the Purchased Assets that constitute tangible\npersonal property is held under any lease, security agreement, conditional sales\ncontract, lien, or other title retention or security arrangement.\n\n                (d) Except as provided in this Agreement, no restrictions will\nexist on Buyer's right to sell, resell, license or sublicense any of the\nPurchased Assets or engage in the Business, nor will any such restrictions be\nimposed on Buyer as a consequence of the transactions contemplated by this\nAgreement or by any agreement referenced in this Agreement.\n\n                (e) All of the Purchased Assets are in good operating condition\nand repair, normal wear and tear excepted, as required for their use in the\nBusiness as presently conducted, and conform to all applicable laws, and no\nnotice of any violation of any law relating to any of the Purchased Assets or\nAssumed Liabilities has been received by Seller or Seller Sub.\n\n        4.10 INTELLECTUAL PROPERTY.\n\n                (a) The execution, delivery and performance of this Agreement\nand the consummation of the transactions contemplated hereby (including without\nlimitation the continued conduct by Buyer after the Closing Date of the Business\nand the incorporation of any Intellectual Property in any product of Buyer or an\nAffiliate of Buyer) will not breach, violate or conflict with any instrument or\nagreement governing any Intellectual Property and will not cause the forfeiture\nor termination or give rise to a right of forfeiture or termination of any\nIntellectual Property or in any material way impair the right of Buyer or any of\nits Affiliates to use, sell, license or dispose of, or to bring any action for\nthe infringement of, any Intellectual Property or portion thereof;\n\n                (b) Neither the development, manufacture, marketing, license,\nsale or use of any product or intellectual property currently licensed, used or\nsold by Seller or Seller Sub in the Business or currently under development in\nthe Business violates or will violate any license or agreement to which Seller\nor Seller Sub is a party or infringes or, to Seller's best knowledge, will\n\n\n                                      -10-\n   11\n\ninfringe any copyright, patent, trademark, service mark, trade secret or other\nintellectual property or other proprietary right of any other party. All\nregistered Intellectual Property (including without limitation trademarks,\ndomain names, service marks, patents and copyrights) are valid and subsisting.\nThere is no pending or threatened claim against the Company or litigation\ncontesting the validity, ownership or right to use, sell, license or dispose of\nany of the Purchased Assets (including without limitation the Intellectual\nProperty) necessary or required for, or used in, the conduct of the Business\nnor, to Seller's knowledge, is there any basis for any such claim, nor has\nSeller or Seller Sub received any notice asserting that any such Purchased Asset\n(including without limitation the Intellectual Property) or the proposed use,\nsale, license or disposition thereof conflicts or will conflict with the rights\nof any other party, nor, to Seller's knowledge, is there any basis for any such\nassertion. To Seller's best knowledge, there is no material unauthorized use,\ninfringement or misappropriation on the part of any third party of the Purchased\nAssets (including without limitation the Intellectual Property);\n\n                (c) Schedule 2.1(h) contains a complete and accurate list of all\napplications, filings and other formal actions made or taken pursuant to\nfederal, state, local and foreign laws by Seller or Seller Sub to perfect or\nprotect its interest in the Purchased Assets, including, without limitation, all\npatents, patent applications, trademarks, trademark applications, service marks\nand copyright or mask work registrations.\n\n                (d) Seller and Seller Sub have taken reasonable steps\n(including, without limitation, entering into confidentiality and non-disclosure\nwith all officers and employees of and consultants with access to or knowledge\nof the Purchased Assets (including without limitation the Intellectual Property)\nto maintain the secrecy and confidentiality of the Purchased Assets (including\nwithout limitation the Intellectual Property).\n\n                (e) All fees to maintain Seller's and Seller Sub's rights in the\nIntellectual Property, including, without limitation, patent and trademark\nregistration and prosecution fees and all professional fees in connection\ntherewith pertaining to the Intellectual Property due and payable on or before\nthe Closing Date, have been paid by Seller or Seller Sub or will be paid by\nSeller or Seller Sub within a reasonable period after the Closing.\n\n        4.11 CUSTOMER AGREEMENTS.\n\n                (a) The Seller Disclosure Schedule contains a list (including\nnames, addresses, contact names and telephone numbers), which is complete in all\nmaterial respects, of all agreements or other arrangements pursuant to which\nSeller or Seller Sub is obligated to supply products, perform services or\notherwise engage in the conduct of the Business (such agreements, as\nsupplemented below, are referred to collectively as the \"Customer Agreements\").\nSeller has provided a true and complete copy of all Customer Agreements to\nBuyer. All such Customer Agreements are in full force and effect and are valid\nand effective in accordance with their respective terms against Seller or Seller\nSub, and against the other party thereto. Seller or Seller Sub holds right,\ntitle and interest to the benefits afforded it under the terms of each Customer\nAgreement free of all Liens, other than Liens imposed or arising under the\nAssumed Liabilities. Neither Seller nor Seller Sub is in default under any such\nCustomer Agreements (or\n\n\n                                      -11-\n   12\n\nhas caused an event which with notice or lapse of time, or both, would\nconstitute a default), nor, to Seller's knowledge, is the other party thereto in\ndefault (or has caused an event which with notice or lapse of time, or both,\nwould constitute a default) under any such Customer Agreements.\n\n                (b) Neither Seller nor Seller Sub has entered into any agreement\nunder which Seller or Seller Sub is restricted from selling, licensing or\notherwise distributing any products or services of the Business to any class of\ncustomers, in any geographic area, during any period of time or in any segment\nof the market.\n\n                (c) After the Closing, Buyer will not be prevented by any act of\nSeller or Seller Sub from changing prices charged in any future agreement to\nexisting or future customers of any products or services.\n\n                (d) Neither Seller nor Seller Sub has granted any third party\nthe right to supply any products or services of the Business to any other third\nparty. No agreement for supply of the products or services of the Business by\nSeller or Seller Sub obligates Seller or Seller Sub, and no agreement would\nobligate Buyer after the Closing Date, to provide any change in specification of\nsuch products or services or to provide new products or services. No agreement\npursuant to which Seller or Seller Sub has licensed to a third party the use of\nany products of the Business obligates Seller or Seller Sub to provide any\nchange in specification in the performance of such products or to provide new\nproducts or services.\n\n        4.12 WARRANTIES AND INDEMNITIES. The Seller Disclosure Schedule sets\nforth a summary of all contractual warranties and indemnities, express or\nimplied, relating to products sold or services rendered by Seller in connection\nwith the Business, and no contractual warranty or indemnity in connection with\nthe Business has been given by Seller or Seller Sub which is not listed on the\nSeller Disclosure Schedule or which differs therefrom in any respect. Seller and\nSeller Sub are each in compliance, in all material respects, with all warranties\ndescribed in the Seller Disclosure Schedule. The Seller Disclosure Schedule, in\nall material respects, also indicates all warranty and indemnity claims\ncurrently pending against Seller or Seller Sub in connection with the Business.\nSeller and Seller Sub have expressly disclaimed in all agreements with third\nparties all implied warranties of merchantability and fitness for a particular\npurpose with respect to all of the Purchased Assets, except as expressly set\nforth in Schedule 4.12 of the Seller Disclosure Schedule.\n\n        4.13 REAL PROPERTY.\n\n                (a) Schedule 2.1(a) sets forth, with respect to each real\nproperty lease to be assumed by Buyer, the name of the lessor, the date of the\nlease and each amendment thereto and the aggregate annual rental and\/or other\nfees payable under any such lease. All such leases are in full force and effect.\nAll such leases are valid and effective in accordance with their respective\nterms, enforceable against Seller or Seller Sub and the other party thereto.\nSeller has delivered to Buyer a true, correct and complete copy of each lease\nidentified on Schedule 2.1(a). The premises or property described in said leases\nare presently occupied or used by Seller or Seller Sub as lessee under the terms\nof said leases. Seller or Seller Sub is the legal and equitable owner\n\n\n                                      -12-\n   13\n\nand holder of the leasehold interest in each such lease. Seller or Seller Sub\nhas all right, title and interest of the lessee under the terms of said leases,\nfree of all Liens, other than Liens imposed or arising under the Assumed\nLiabilities. Neither Seller nor Seller Sub is in default under any such leases\n(and has not caused an event which with notice or lapse of time, or both, would\nconstitute a default), and to the Seller's knowledge, the other party thereto is\nnot in default (and has not caused an event which with notice or lapse of time,\nor both, would constitute a default) under any such leases.\n\n                (b) Any real property included in the Purchased Assets currently\nhas access to public roads or valid easements providing access to public roads,\nwater supply, storm and sanitary sewer facilities, telephone, gas and electrical\nconnections, fire protection, drainage and other public utilities, as is\nnecessary for the conduct of the Business.\n\n                (c) None of the material structures on any real property\nincluded in the Purchased Assets encroaches upon the real property of another\nPerson, and no structure of any other Person encroaches upon any real property\nincluded in the Purchased Assets.\n\n                (d) No violation of any law, regulation or ordinance, including\nwithout limitation, laws, regulations or ordinances relating to zoning,\nenvironmental, city planning or similar matters) relating to the Business or any\nPurchased Asset currently exists or has existed at any time except for\nviolations which have not had and would not reasonably be expected to have,\nindividually or in the aggregate, a Material Adverse Effect on the Business or\nthe Purchased Assets. There are no developments affecting any of the Purchased\nAssets pending or, to the knowledge of Seller threatened, which might materially\ndetract from the value of such Purchased Assets, materially interfere with the\npresent use of such Purchased Assets or have a Material Adverse Effect on the\nmarketability of the Purchased Assets.\n\n        4.14 INVENTORIES. All of the Inventories included in the Purchased\nAssets are and are expected by Seller to be items of a quality usable or salable\nin the ordinary and usual course of business. The value at which the Inventories\nare carried on the May 31 Balance Sheet reflects an inventory valuation policy\nof Seller which is consistent with industry practice and which is in accordance\nwith GAAP, consistently applied.\n\n        4.15 ACCOUNTS RECEIVABLE. All accounts receivable, notes receivable and\nother receivables included in the Purchased Assets are valid, genuine and are\nexpected by Seller to be fully collectible in the aggregate amount thereof,\nsubject to normal and customary trade discounts less any reserves for doubtful\naccounts recorded on the May 31 Balance Sheet. All accounts, notes receivable,\nand other receivables arising out of or relating to the Business on May 31 have\nbeen included in the May 31 Balance Sheet.\n\n        4.16 LICENSES AND PERMITS. Seller or Seller Sub holds all consents,\napprovals, registrations, certifications, authorizations, permits and licenses\nof, and has made all filings with, or notifications to, all Governmental\nEntities pursuant to applicable requirements of all federal, state, local and\nforeign laws, ordinances, governmental rules or regulations applicable to the\nBusiness, including, but not limited to, all such laws, ordinances, governmental\nrules or regulations relating to registration of the products of the Business\n(at their current level of\n\n\n                                      -13-\n   14\n\ndevelopment and use) and certification of the facilities of the Business. The\nBusiness is in material compliance with all federal, state, local and foreign\nlaws, ordinances, governmental rules and regulations relating to the products\nmanufactured by the Business or otherwise related to the Business and Seller has\nno reason to believe that any consents, approvals, authorizations,\nregistrations, certifications, permits, filings or notifications that it has\nreceived or made to operate the Business are invalid or have been or are being\nsuspended, canceled, revoked or questioned. There is no investigation or inquiry\nto which Seller or Seller Sub is a party or, to Seller's knowledge, pending or\nthreatened, relating to the Business and its compliance with applicable foreign,\nstate, local or foreign laws, ordinances, governmental rules or regulations.\nEach such consent, approval, registration, certification, authorization, permit\nor license is transferable and shall be transferred to Buyer in accordance with\nthe terms of this Agreement.\n\n        4.17 EMPLOYEES.\n\n                (a) Schedule 4.17 sets forth the names, home addresses,\ncompensation levels, share option position, if any, and job titles of all of the\nemployees currently engaged in connection with the Business or who have accepted\noffers of employment from Seller or Seller Sub to work in connection with the\nBusiness. All past and present employees, consultants, officers, and directors\nof Seller or any parent or subsidiary of Seller that have had access to the\nPurchased Assets are parties to a written agreement (a \"Confidentiality\nAgreement\"), under which each such person or entity (i) is obligated to disclose\nand transfer to Seller, without the receipt by such person of any additional\nvalue therefor (other than normal salary or fees for consulting services), all\ninventions, developments and discoveries which, during the period of employment\nwith or performance of services for Seller or parent or subsidiary of Seller, he\nor she makes or conceives of either solely or jointly with others, that relate\nto any subject matter with which his or her work for Seller or parent or\nsubsidiary of Seller may be concerned, or relate to or are connected with the\nBusiness, products or projects of Seller or Seller Sub, or involve the use of\nthe time, material or facilities of Seller or Seller Sub, and (ii) is obligated\nto maintain the confidentiality of proprietary information of Seller and Seller\nSub. To Seller's best knowledge, none of Seller's or Seller Sub's employees,\nconsultants, officers or directors is obligated under any contract (including\nlicenses, covenants or commitments of any nature) or other agreement, or subject\nto any judgment, decree or order of any court or administrative agency, that\nwould conflict with their obligation to promote the interests of Seller or\nSeller Sub with regard to the Business or the Purchased Assets or that would\nconflict with the Business or the Purchased Assets. To Seller's best knowledge,\nneither the execution nor the delivery of this Agreement, nor the carrying on of\nthe Business by its or Seller Sub's employees and consultants, will conflict\nwith or result in a breach of the terms, conditions or provisions of, or\nconstitute a default under, any contract, covenant or instrument under which any\nof such persons or entities are now obligated. It is currently not necessary nor\nwill it be necessary for Seller or Seller Sub to utilize in the Business any\ninventions of any of such persons or entities (or people it currently intends to\nhire) made or owned prior to their employment by or affiliation with Seller or\nSeller Sub, nor is it or will it be necessary to utilize any other assets or\nrights of any such persons or entities (or people it currently intends to hire)\nmade or owned prior to their employment with or engagement by Seller or Seller\nSub, in violation of any registered patents, trade names, trademarks or\ncopyrights or any other limitations or restrictions to which any such persons or\nentity is a party or\n\n\n                                      -14-\n   15\n\nto which any of such assets or rights may be subject. To the Seller's knowledge,\nnone of Seller's or Seller Sub's employees, consultants, officers, directors or\nstockholders that has had knowledge or access to information relating to the\nPurchased Assets has taken, removed or made use of any proprietary\ndocumentation, manuals, products, materials, or any other tangible item from his\nor her previous employer relating to the Purchased Assets by such previous\nemployer which has resulted in Seller's or Seller Sub's access to or use of such\nproprietary items included in the Purchased Assets, and neither Seller nor\nSeller Sub will gain access to or make use of any such proprietary items in the\nBusiness, except to the extent that any such activities would not have a\nMaterial Adverse Effect on the Purchased Assets or the Business.\n\n                (b) Except for the Confidentiality Agreements, there are no\nwritten or oral contracts of employment between Seller and any Employee.\n\n                (c) Neither Seller nor Seller Sub is a party to a collective\nbargaining agreement with any trade union, neither Seller's nor Seller Sub's\nemployees are members of a trade union certified as a bargaining agent with the\nSeller or Seller Sub and no proceedings to implement any such collective\nbargaining agreement or certifications are pending.\n\n        4.18 EMPLOYEE BENEFIT AND COMPENSATION PLANS. Buyer will incur no\nliability with respect to, or on account of, and Seller and\/or Seller Sub will\nretain any liability for, and on account of, any employee benefit plan of Seller\nor Seller Sub, any of its Affiliates or any predecessor employer of any\nemployee, including, but not limited to, liabilities Seller and\/or Seller Sub\nmay have to such employees under all employee benefit schemes, incentive\ncompensation plans, bonus plans, pension and retirement plans, vacation,\nprofit-sharing plans (including any profit-sharing plan with a cash-or-deferred\narrangement) share purchase and option plans, savings and similar plans,\nmedical, dental, travel, accident, life, disability and other insurance and\nother plans or arrangements, whether written or oral and whether \"qualified\" or\n\"non-qualified,\" or to any employee as a result of termination of employment by\nSeller or Seller Sub as contemplated by this Agreement. Neither Seller nor\nSeller Sub has, with respect to any employee, maintained or contributed to, or\nbeen obligated or required to contribute to, any retirement or pension plan or\nany employee benefit plan. Neither Seller nor Seller Sub is a party to any\ncollective bargaining agreement covering any employee and Seller knows of no\neffort to organize any such employee as a part of any collective bargaining\nunit. The Seller and Seller Sub have complied with all of their respective\nobligations (including obligations to make contributions) in respect of the\npension funds of which its employees are members, there is no outstanding\nliability of the Seller or any of its Affiliates to any such funds and all such\nfunds are fully funded to meet all potential claims for benefits by any and all\nsuch employees and any former employee.\n\n        4.19 TAXES. All Taxes have been or will be paid by Seller or Seller Sub\nfor all periods (or portions thereof) prior to and including the Closing Date.\nSeller and any other person required to file returns or reports of Taxes have\nduly and timely filed (or will file prior to the Closing Date) all returns and\nreports of Taxes required to be filed prior to such date, and all such returns\nand reports are true, correct, and complete in all material respects. There are\nno liens for Taxes on any of the Purchased Assets, except for any Lien for taxes\nnot yet due or which are\n\n\n                                      -15-\n   16\n\nbeing contested in good faith. Seller and Seller Sub have complied in all\nmaterial respects with all record keeping and tax reporting obligations relating\nto income and employment taxes due with respect to compensation paid to\nemployees or independent contractors providing services to the Business. Seller\nis not a \"foreign person\" within the meaning of Section 1445(f)(3) of the Code.\nThere are no pending or, to Seller's knowledge, threatened proceedings with\nrespect to Taxes, and there are no outstanding waivers or extensions of statutes\nof limitations with respect to assessments of Taxes. No agreement or arrangement\nregarding compensation of any employee providing services to the Business\nprovides for any payments which could result in a nondeductible expense to the\nBuyer pursuant to Section 280G of the Code or an excise tax to the recipient of\nsuch payment pursuant to Section 4999 of the Code.\n\n        4.20 COMPLIANCE WITH LAW. The operation of the Business by Seller and\nSeller Sub has been conducted in all material respects in accordance with all\napplicable laws, regulations and other requirements of Governmental Entities\nhaving jurisdiction over the same.\n\n        4.21 ENVIRONMENTAL MATTERS. Seller has provided to Buyer all\nenvironmentally related audits, studies, reports, analyses, and results of\ninvestigations known to Seller which have been performed with respect to the\ncurrently or previously owned, leased or operated properties of Seller or Seller\nSub in connection with the Business. Except as set forth on Schedule 4.21\nhereto:\n\n                (a) to Seller's knowledge (i) neither the conduct nor operation\nof the Business by Seller or Seller Sub, nor any condition of any real property\npresently owned, leased or operated by either of them in connection with the\nBusiness violates any Environmental Laws (as defined below) or any Permits\nissued pursuant to Environmental Laws, and (ii) neither Seller nor Seller Sub\nhas received any communication from the relevant landlord or any Governmental\nAuthority stating that the operation or condition of any real property presently\nowned, leased or operated in connection with the Business is in violation of any\nEnvironmental Law or any Permit issued pursuant to any Environmental Law;\n\n                (b) Seller and Seller Sub have obtained and currently maintains\nall material Permits required to be maintained thereby under all Environmental\nLaws necessary to use the Purchased Assets in the Business and there is no\npending, or to the knowledge of Seller threatened, proceeding, action, or claim\nto revoke or materially modify the terms or conditions of such Permits;\n\n                (c) Neither Seller nor Seller Sub is the subject of or subject\nto any outstanding written order, judgement, ruling, agreement or contract with\nany Governmental Authority or other Person in connection with the Purchased\nAssets respecting (i) Environmental Laws, (ii) Remedial Action (as defined\nbelow) or (iii) any Release (as defined below) or threatened Release of a\nHazardous Material (as defined below);\n\n                (d) Seller has no knowledge of any facts, circumstances or\nconditions relating to the Purchased Assets that could reasonably be expected to\nresult in Seller or Seller Sub incurring any material liabilities under or\npursuant to any Environmental Law;\n\n\n                                      -16-\n   17\n\n                (e) there are no proceedings or investigations pending or, to\nSeller's knowledge, threatened against Seller or Seller Sub in connection with\nthe Purchased Assets which could reasonably be expected to lead to the\nimposition of any liability on Seller or Seller Sub pursuant to any\nEnvironmental Law; and\n\n                (f) to Seller's knowledge, there is not located at any of the\nproperties listed as or in connection with a Purchased Asset, any (i)\nunderground storage tanks, (ii) asbestos-containing material or (iii) equipment\ncontaining polychlorinated biphenyls.\n\n                As used herein the following terms shall have the respective\nmeanings set forth below:\n\n                        (i) \"ENVIRONMENTAL LAW\" means any applicable United\nStates, federal, state or local or foreign statute, law, code, regulation,\nordinance or rule of common law relating to the protection or regulation of\nhuman health and safety, the environment, or natural resources, including\nwithout limitation the Comprehensive Environmental Response, Compensation and\nLiability Act (42 U.S.C. Section 9601 et seq.), the Hazardous Materials\nTransportation Act (49 U.S.C. App. Section 1801 et seq.), the Resource\nConservation and Recovery Act, (42 U.S.C. Section 6901 et seq.), the Clean Water\nAct (33 U.S.C. Section 1251 et seq.), the Clean Air Act (42 U.S.C. Section 7401\net seq.), the Toxic Substances Control Act (15 U.S.C. Section 2601 et seq.), the\nFederal Insecticide, Fungicide, and Rodenticide Act (7 U.S.C. Section 136 et\nseq.), and the Occupational Safety and Health Act (29 U.S.C. Section 651 et\nseq.), and the regulations promulgated pursuant thereto and any analogous state\nlaws or applicable foreign laws that govern environmental matters with respect\nto Purchased Assets located outside the United States.\n\n                        (ii) \"HAZARDOUS MATERIAL\" means any substance, material\nor waste which is regulated, classified or otherwise characterized as hazardous,\ntoxic, pollutant, contaminant or words of similar meaning or regulatory effect\nby the United States or any state or local governmental authority or applicable\nforeign governmental authority, including petroleum and its by-products,\nasbestos or asbestos-containing materials, polychlorinated biphenyls, urea\nformaldehyde insulation and radioactive materials.\n\n                        (iii) \"RELEASE\" means any release, spill, emission,\nleaking, pumping, injection, deposit, disposal, discharge, dispersal, or\nleaching into the indoor or outdoor environment, or into or out of any property.\n\n                        (iv) \"REMEDIAL ACTION\" means all actions to (i) clean\nup, remove, treat or in any other way address any Hazardous Material; (ii)\nprevent the Release of any Hazardous Material so it does not endanger or\nthreaten to endanger public health or welfare or the indoor or outdoor\nenvironment; or (iii) perform pre-remedial studies and investigations or\npost-remedial monitoring and care.\n\n        4.22 CONTRACTS.\n\n                (a) Schedule 4.22 contains a list of all contracts relating to\nthe Business, including, without limitation, the following:\n\n\n                                      -17-\n   18\n\n                        (i) each contract for the purchase of inventory, spare\nparts, other materials or personal property with any supplier used in, or for\nthe furnishing of services to, the Business;\n\n                        (ii) each customer contract and agreement of the\nBusiness;\n\n                        (iii) (A) all distributor, manufacturer's\nrepresentative, broker, franchise, agency and dealer contracts and agreements of\nthe Business (specifying on a matrix, in the case of distributor agreements, the\nname of the distributor, product, territory, termination date and exclusivity\nprovisions) and (B) all sales promotion, market research, marketing and\nadvertising contracts and agreements of the Business;\n\n                        (iv) all management contracts with independent\ncontractors or consultants (or similar arrangements) of the Business;\n\n                        (v) all contracts and agreements (excluding routine\nchecking account overdraft agreements involving petty cash amounts) under which\nthe Business has created, incurred, assumed or guaranteed (or may create, incur,\nassume or guarantee) indebtedness of itself or of any third-party Person or\nunder which the Business has imposed (or may impose) a security interest or lien\non any of its assets, whether tangible or intangible, to secure indebtedness;\n\n                        (vi) all contracts and agreements that limit the ability\nof any Person related to the Business, or any of its affiliates, to compete in\nany line of business or with any person or in any geographic area or during any\nperiod of time, or to solicit any customer or client;\n\n                        (vii) all contracts pursuant to which the Business has\nagreed to supply products to a customer at specified prices, whether directly or\nthrough a specific distributor, manufacturer's representative or dealer; and\n\n                        (viii) all other contracts (A) which are material to the\nBusiness or (B) the absence of which would have a Material Adverse Effect on the\nBusiness, or (C) relating to the Business which are believed by Seller to be of\nunique value even though not material to the Business.\n\n                (b) Each Contract and each contract or agreement disclosed on\nSchedule 4.22 is a legal, valid and binding agreement, and, to Seller's best\nknowledge, none of these agreements is in default by its terms or has been\ncanceled by the other party; Seller is not in receipt of any claim of default\nunder any such agreement; and Seller does not anticipate any termination or\nchange to, or receipt of a proposal with respect to, any such agreements a\nresult of the transactions contemplated hereby. Seller has furnished Buyer with\ntrue and complete copies of all such agreements together with all amendments,\nwaivers or other changes thereto.\n\n        4.23 PRODUCTS. Each of the products and services produced, sold or\nprovided by Seller or Seller Sub in connection with the Business is, and at all\ntimes has been, in compliance in all\n\n\n                                      -18-\n   19\n\nmaterial respects with all applicable federal, state, local and foreign laws and\nregulations and is, and at all relevant times has been, fit for the ordinary\npurposes for which it is intended to be used and conforms in all material\nrespects to any promises or affirmations of fact made in connection with the\nsale of such product or service. There is no design defect with respect to any\nof such products, and each of such products contains adequate warnings,\npresented in a reasonably prominent manner, in accordance with applicable laws\nand current industry practice with respect to its contents and use.\n\n        4.24 PRODUCT LIABILITY. There are no claims, actions, suits, inquiries,\nproceedings or investigations pending by or against Seller or Seller Sub,\nrelating to any products of the Business and containing allegations that such\nproducts are defective or were improperly designed or manufactured or improperly\nlabeled or otherwise improperly described for use.\n\n        4.25 LITIGATION; OTHER CLAIMS.\n\n                (a) There are no claims, actions, suits, inquiries, proceedings,\nor investigations against Seller or Seller Sub, or any of their respective\nofficers, directors or stockholders, relating to the Business, the Purchased\nAssets or the Employees which are currently pending or threatened against the\nCompany, at law or in equity or before or by any Governmental Entity, or which\nchallenges or seeks to prevent, enjoin, alter or materially delay any of the\ntransactions contemplated hereby, nor is Seller aware of any basis for such\nclaims, actions, suits, inquiries, proceedings, or investigations; and no\nGovernmental Entity has at any time challenged or questioned the legal right of\nSeller or Seller Sub to manufacture, offer or sell any of its products or\nservices in the present manner or style thereof.\n\n                (b) There are no grievance or arbitration proceedings pending or\nthreatened, and there are no actual or threatened strikes or work stoppages with\nrespect to the Business, the Purchased Assets or the Employees, nor is Seller\naware of any basis for such proceedings or events.\n\n        4.26 DEFAULTS. Neither Seller nor Seller Sub is in default under or with\nrespect to any judgment, order, writ, injunction or decree of any court or any\nGovernmental Entity which could reasonably be expected to have a Material\nAdverse Effect on the Business or any of the Purchased Assets. There does not\nexist any default by Seller or Seller Sub or, to Seller's knowledge, or by any\nother Person, or event that, with notice or lapse of time, or both, would\nconstitute a default under any agreement entered into by Seller or Seller Sub as\npart of the operations of the Business which could reasonably be expected to\nhave a Material Adverse Effect on the Business or the Purchased Assets, and no\nnotices of breach thereof have been received by Seller.\n\n        4.27 SCHEDULES. The schedules describing the Purchased Assets are\ncomplete and accurate and describe the assets in the possession of, or used by\nSeller or Seller Sub in connection with the Business. The property listed in\nsuch Schedules constitutes all of the tangible and intangible property necessary\nfor the conduct by Seller and Seller Sub of the Business.\n\n\n                                      -19-\n   20\n\n        4.28 FULL DISCLOSURE. Seller is not aware of any facts pertaining to the\nPurchased Assets which affect the Business or the Purchased Assets in a\nmaterially adverse manner or which will in the future affect the Business or the\nPurchased Assets in a materially adverse manner. Neither this Agreement nor any\nother agreement, exhibit, schedule or officer's certificate being entered into\nor delivered pursuant to this Agreement contains any untrue statement of a\nmaterial fact or omits to state any material fact necessary in order to make the\nstatements contained therein, in light of the circumstances under which they are\nmade, not misleading.\n\n        4.29 BROKERS AND FINDERS. Neither Seller nor any of its officers,\ndirectors or employees has employed any broker or finder or incurred any\nliability for any brokerage fee, commission or finder's fee in connection with\nthe transactions contemplated by this Agreement.\n\n        4.30 FAIR CONSIDERATION; NO FRAUDULENT CONVEYANCE. The sale of the\nPurchased Assets pursuant to this Agreement is made in exchange for fair and\nequivalent consideration. Seller and Seller Sub are not now insolvent and will\nnot be rendered insolvent by the sale, transfer and assignment of the Purchased\nAssets pursuant to the terms of this Agreement. Seller and Seller Sub are not\nentering into this Agreement or any of the other agreements referenced in this\nAgreement with the intent to defraud, delay or hinder their respective creditors\nand the consummation of the transactions contemplated by this Agreement, and the\nother agreements referenced in this Agreement, will not have any such effect.\nThe transactions contemplated in this Agreement or any agreements referenced in\nthis Agreement will not constitute a fraudulent conveyance, or otherwise give\nrise to any right of any creditor of Seller or Seller Sub to any of the\nPurchased Assets after the Closing.\n\n        4.31 INSURANCE. The Seller Disclosure Schedule lists all insurance\npolicies and fidelity bonds covering the Purchased Assets. There is no claim by\nSeller or Seller Sub pending under any of such policies or bonds as to which\ncoverage has been questioned, denied or disputed by the underwriters of such\npolicies and bonds. All premiums due and payable under all such policies and\nbonds have been paid and Seller and Seller Sub are otherwise in material\ncompliance with the terms of such policies and bonds (or other policies and\nbonds providing substantially similar insurance coverage). There is no\nthreatened termination of, or material premium increase with respect to, any of\nsuch policies.\n\n5. ADDITIONAL REPRESENTATIONS AND WARRANTIES OF SELLER CONCERNING THE\n   SECURITIES.\n\n        5.1 PURCHASE ENTIRELY FOR OWN ACCOUNT. This Agreement is made with\nSeller and Seller Sub in reliance upon Seller's representation to Buyer, which\nby Seller's execution of this Agreement Seller hereby confirms, the Securities\nto be acquired by Seller will be acquired for investment for Seller's own\naccount, not as a nominee or agent, and not with a view to the resale or\ndistribution of any part thereof, and that Seller has no present intention of\nselling, granting any participation in, or otherwise distributing the same. By\nexecuting this Agreement, Seller further represents that Seller does not\npresently have any contract, undertaking, agreement or arrangement with any\nperson to sell, transfer or grant participations to such person or to any third\n\n\n                                      -20-\n   21\n\nperson, with respect to any of the Securities. Seller has not been formed for\nthe specific purpose of acquiring the Securities.\n\n        5.2 DISCLOSURE OF INFORMATION. Seller believes it has received all of\nthe information it considers necessary or appropriate for deciding whether to\nacquire the Securities. Seller further represents that it has had an opportunity\nto ask questions and receive answers from Buyer regarding the Securities. The\nforegoing, however, does not limit or modify the representations and warranties\nof the Buyer contained in Section 6 or the right of the Seller to rely thereon.\n\n        5.3 RESTRICTED SECURITIES. Seller understands that the Securities have\nnot been, and will not be as of the Closing Date, registered under the\nSecurities Act of 1933, as amended (the \"Securities Act\") , by reason of a\nspecific exemption from the registration provisions of the Securities Act which\ndepends upon, among other things, the bona fide nature of the investment intent\nand the accuracy of Seller's representations as expressed herein. Seller\nunderstands that the Securities are \"restricted securities\" under applicable\nU.S. federal and state securities laws and that, pursuant to these laws, Seller\nmust hold THE Securities unless and until they are registered with the\nSecurities and Exchange Commission and qualified by state authorities, or an\nexemption from such registration and qualification requirements is available.\nSeller acknowledges that, except as provided under the Investor Rights\nAgreement, Buyer has no obligation to register or qualify the Securities for\nresale. Seller further acknowledges that if an exemption from registration or\nqualification is available, it may be conditioned on various requirements\nincluding, but not limited to, the time and manner of sale, the holding period\nfor the Securities, and on requirements relating to Buyer which are outside of\nSeller's control, and which Buyer is under no obligation and may not be able to\nsatisfy.\n\n        5.4 LEGENDS. Seller understands that the Securities, and any securities\nissued in respect of or exchange for the Securities, may bear one or all of the\nfollowing legends:\n\n                (a) \"THE SHARES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN\nREGISTERED UNDER THE SECURITIES ACT OF 1933, AND HAVE BEEN ACQUIRED FOR\nINVESTMENT AND NOT WITH A VIEW TO, OR IN CONNECTION WITH, THE SALE OR\nDISTRIBUTION THEREOF. NO SUCH SALE OR DISTRIBUTION MAY BE EFFECTED WITHOUT AN\nEFFECTIVE REGISTRATION STATEMENT RELATED THERETO OR AN OPINION OF COUNSEL IN A\nFORM REASONABLY SATISFACTORY TO THE PURCHASER THAT SUCH REGISTRATION IS NOT\nREQUIRED UNDER THE SECURITIES ACT OF 1933.\"\n\n                (b) Any legend required by the laws of the State of California,\nincluding any legend required by the California Department of Corporations.\n\n                (c) Any legend required by the Blue Sky laws of any state to the\nextent such laws are applicable to the shares represented by the certificate so\nlegended.\n\n        5.5 ACCREDITED INVESTOR. Seller is an accredited investor as defined in\nRule 501(a) of Regulation D promulgated under the Securities Act.\n\n\n                                      -21-\n   22\n\n        5.6 CORPORATE SECURITIES LAW. THE SALE OF THE SECURITIES THAT IS THE\nSUBJECT OF THIS AGREEMENT HAS NOT BEEN QUALIFIED WITH THE COMMISSIONER OF\nCORPORATIONS OF THE STATE OF CALIFORNIA. THE ISSUANCE OF SUCH SECURITIES OR THE\nRECEIPT OF ANY PART OF THE ASSETS FOR SUCH SECURITIES PRIOR TO SUCH\nQUALIFICATION IS UNLAWFUL, UNLESS THE SALE OF SECURITIES IS EXEMPT FROM THE\nQUALIFICATION BY SECTION 25100, 25102 OR 25105 OF THE CALIFORNIA CORPORATIONS\nCODE. THE RIGHTS OF ALL PARTIES TO THIS AGREEMENT ARE EXPRESSLY CONDITIONED UPON\nSUCH QUALIFICATION BEING OBTAINED UNLESS THE SALE IS SO EXEMPT.\n\n6. REPRESENTATIONS AND WARRANTIES OF BUYER\n\n        Buyer represents and warrants to Seller and Seller Sub as follows:\n\n        6.1 ORGANIZATION. Buyer is a corporation duly organized and validly\nexisting under the laws of Delaware, and has full corporate power and authority\nand the legal right to execute and deliver this Agreement and all of the other\nagreements and instruments to be executed and delivered by Buyer pursuant\nhereto, and to consummate the transactions contemplated hereby and thereby.\n\n        6.2 AUTHORITY. The execution and delivery of this Agreement (and all\nother agreements and instruments contemplated hereunder) by Buyer, the\nperformance by Buyer of its obligations hereunder and thereunder, and the\nconsummation by Buyer of the transactions contemplated hereby and thereby have\nbeen duly authorized by all necessary action by the Board of Directors of Buyer,\nand no other act or proceeding on the part of Buyer or its shareholders is\nnecessary to approve the execution and delivery of this Agreement and such other\nagreements and instruments, the performance by Buyer of its obligations\nhereunder and thereunder and the consummation of the transactions contemplated\nhereby and thereby. The signatory officers of Buyer have the power and authority\nto execute and deliver this Agreement and all of the other agreements and\ninstruments to be executed and delivered by Buyer pursuant hereto, to consummate\nthe transactions hereby and thereby contemplated and to take all other actions\nrequired to be taken by Buyer pursuant to the provisions hereof and thereof.\n\n        6.3 EXECUTION AND BINDING EFFECT. This Agreement has been duly and\nvalidly executed and delivered by Buyer and constitutes, and the other\nagreements and instruments to be executed and delivered by Buyer pursuant\nhereto, upon their execution and delivery by Buyer, will constitute (assuming,\nin each case, the due and valid authorization, execution and delivery thereof by\nSeller and Seller Sub), legal, valid and binding agreements of Buyer,\nenforceable against Buyer in accordance with their respective terms, except as\nenforceability may be limited by bankruptcy, insolvency, moratorium, or other\nlaws affecting the enforcement of creditors' rights generally or provisions\nlimiting competition, and by equitable principles.\n\n        6.4 CONSENT AND APPROVALS. There is no requirement applicable to Buyer\nto make any filing, declaration or registration with, or to obtain any permit,\nauthorization, consent or approval of, any Governmental Entity as a condition to\nthe lawful consummation by Buyer of the\n\n\n                                      -22-\n   23\n\ntransactions contemplated by this Agreement and the other agreements and\ninstruments to be executed and delivered by Buyer pursuant hereto, except for\nfilings (a) which are referred to in the Seller Disclosure Schedule or (b) the\nfailure of making which would not have a Material Adverse Effect on the\ntransactions contemplated hereby.\n\n        6.5 NO VIOLATION. Neither the execution, delivery and performance of\nthis Agreement and of all the other agreements and instruments to be executed\nand delivered pursuant hereto, nor the consummation of the transactions\ncontemplated hereby or thereby, will, with or without the passage of time or the\ndelivery of notice or both, (a) conflict with, violate or result in any breach\nof the terms, conditions or provisions of the Certificate of Incorporation or\nBylaws of Buyer, (b) conflict with or result in a violation or breach of, or\nconstitute a default or require consent of any Person (or give rise to any right\nof termination, cancellation or acceleration) under, any of the terms,\nconditions or provisions of any notice, bond, mortgage, indenture, license,\nfranchise, permit, agreement, lease or other instrument or obligation to which\nBuyer is a party or by which Buyer or any of its properties or assets may be\nbound, or (c) violate any statute, ordinance or law or any rule, regulation,\norder, writ, injunction or decree of any Governmental Entity applicable to Buyer\nor by which any of its properties or assets may be bound.\n\n        6.6 SEC FILINGS; FINANCIAL STATEMENTS.\n\n                (a) As of the time it was filed with the U.S. Securities and\nExchange Commission (\"SEC\") (or, if amended or superseded by a filing prior to\nthe date of this Agreement, then on the date of such filing): (i) each report,\nregistration statement and definitive proxy statement filed by Buyer with the\nSEC (\"Buyer's SEC Documents\") complied in all material respects with the\napplicable requirements of the Securities Act or the Exchange Act, as the case\nmay be, and the rules and regulations promulgated by the SEC thereunder; and\n(ii) none of Buyer's SEC Documents contained any untrue statement of a material\nfact or omitted to state a material fact required to be stated therein or\nnecessary in order to make the statements therein, in the light of the\ncircumstances under which they were made, not misleading.\n\n                (b) The financial statements (including the notes thereto)\ncontained in Buyer's SEC Documents: (i) complied as to form in all material\nrespects with the published rules and regulations of the SEC applicable thereto;\n(ii) were prepared in accordance with generally accepted accounting principles\napplied on a consistent basis throughout the periods covered, except as may be\nindicated in the notes to such financial statements and (in the case of\nunaudited statements) as permitted by Form 10-Q of the SEC, and except that\nunaudited financial statements may not contain footnotes and are subject to\nnormal and recurring year-end audit adjustments, which will not, individually or\nin the aggregate, be material in magnitude; and (iii) fairly present in all\nmaterial respects the financial position of Buyer as of the respective dates\nthereof and the results of operations, shareholders' equity and cash flows of\nBuyer for the periods covered thereby. Buyer is not aware of any facts or\ncircumstances that will necessitate a restatement of any financial statements\nthat have been included in Buyer's SEC Documents.\n\n        6.7 ABSENCE OF UNDISCLOSED LIABILITIES. Buyer has no material\nobligations or liabilities of any nature (matured or unmatured, fixed or\ncontingent) other than (i) those set forth\n\n\n                                      -23-\n   24\n\nor adequately provided for in the balance sheet included in Buyer's Annual\nReport on Form 10-K for the period ended March 31, 2000 (the \"Buyer Balance\nSheet\"), (ii) those incurred in the ordinary course of business and not required\nto be set forth in the Buyer Balance Sheet under GAAP, and (iii) those incurred\nin the ordinary course of business since the Buyer Balance Sheet Date and\nconsistent with past practice.\n\n        6.8 ABSENCE OF CERTAIN CHANGES. Since March 31, 2000 (the \"Buyer Balance\nSheet Date\"), Buyer has conducted its business in the ordinary course in a\nmanner consistent with past practice and there has not occurred: (i) any change,\nevent or condition (whether or not covered by insurance) that has resulted in,\nor might reasonably be expected to result in, a Material Adverse Effect on\nBuyer; (ii) any declaration, setting aside, or payment of a dividend or other\ndistribution with respect to the shares of Buyer, or any direct or indirect\nredemption, purchase or other acquisition by Buyer of any of its shares of\ncapital stock; (iii) any material amendment or change to Buyer's Certificate of\nIncorporation or Bylaws; or (iv) any negotiation or agreement by Buyer to do any\nof the things described in the preceding clauses (i) through (iii) (other than\nnegotiations with the Seller and its representatives regarding the transactions\ncontemplated by this Agreement).\n\n        6.9 LITIGATION. There is no private or governmental action, suit,\nproceeding, claim, arbitration or investigation pending before any agency, court\nor tribunal, foreign or domestic, or, to the knowledge of Buyer, threatened\nagainst Buyer or any of its subsidiaries or any of their respective properties\nor any of their respective officers or directors (in their capacities as such)\nthat, individually or in the aggregate, could reasonably be expected to have a\nMaterial Adverse Effect on Buyer. There is no judgment, decree or order against\nBuyer or any of its subsidiaries or, to the knowledge of Buyer or any of its\nsubsidiaries, any of their respective directors or officers (in their capacities\nas such) that could reasonably be expected to prevent, enjoin, or materially\nalter or delay any of the transactions contemplated by this Agreement, or that\ncould reasonably be expected to have a Material Adverse Effect on Buyer.\n\n        6.10 GOVERNMENTAL AUTHORIZATION. Each of Buyer and its subsidiaries has\nobtained each federal, state, county, local or foreign governmental consent,\nlicense, permit, grant, or other authorization of a Governmental Entity that is\nrequired for the operation of Buyer's or any of its subsidiaries' business\n(\"Buyer Authorizations\"), and all of such Buyer Authorizations are in full force\nand effect, except where the failure to obtain or have any of such Buyer\nAuthorizations could not reasonably be expected to have a Material Adverse\nEffect on Buyer.\n\n        6.11 COMPLIANCE WITH LAWS. Each of Buyer and its subsidiaries has\ncomplied with, are not in violation of, and have not received any notices of\nviolation with respect to, any federal, state, local or foreign statute, law or\nregulation with respect to the conduct of its business, or the ownership or\noperation of its business, except for such violations or failures to comply as\ncould not reasonably be expected to have a Material Adverse Effect on Buyer.\n\n        6.12 VALID ISSUANCE. The Securities will, when issued in accordance with\nthe provisions of this Agreement, be duly authorized, validly issued, fully paid\nand nonassessable and free of preemptive rights and encumbrances.\n\n\n                                      -24-\n   25\n\n7. COVENANTS.\n\n        7.1 ACCESS TO INFORMATION.\n\n                (a) Prior and subsequent to the Closing, Seller will permit\nBuyer to make a full and complete investigation of the Purchased Assets and to\nreceive from Seller all information of Seller and Seller Sub relating to the\nPurchased Assets or reasonably related to Seller's and Seller Sub's conduct of\nthe Business. Without limiting this right, Seller will give to Buyer and its\naccountants, legal counsel, and other representatives full access, during normal\nbusiness hours, at a mutually agreeable location arranged in advance, to all of\nthe books, records, files, documents, properties, and contracts of Seller and\nSeller Sub relating to the Purchased Assets or reasonably related to Seller's\nand Seller Sub's conduct of the Business and allow Buyer and any such\nrepresentatives to make copies thereof, all of which shall be made available in\nan organized fashion and so as to facilitate an orderly review. This Section 7.1\nshall not affect or be deemed to modify any representation or warranty contained\nherein or the conditions to the obligations of the parties to consummate the\ntransactions contemplated by this Agreement. Seller shall maintain and make\navailable the information and records specified in this Section 7.1(a) in the\nordinary course of Seller's and Seller Sub's business and document retention\npolicies, as if the transactions contemplated by this Agreement had not\noccurred.\n\n                (b) At all times following the Closing, each party shall provide\nthe other party (at such other party's expense) with such reasonable assistance,\nincluding the provision of available relevant records or other information and\nreasonable access to and cooperation of any employees, as may be reasonably\nrequested by either of them in connection with the preparation of any financial\nstatement or tax return, any audit or examination by any taxing authority, or\nany judicial or administrative proceeding relating to liability for Taxes.\n\n        7.2 THIRD PARTY CONSENTS. Seller, Seller Sub and Buyer shall use\ncommercially reasonable efforts to obtain, within the applicable time periods\nrequired, all Required Consents, waivers, permits, consents and approvals and to\neffect all registrations, filings and notices with or to third parties or\nGovernmental Entities which are necessary to consummate the transactions\ncontemplated by this Agreement so as to preserve all rights of, and benefits to,\nthe Buyer in the Purchased Assets.\n\n        7.3 CERTAIN NOTIFICATIONS. At all times prior to the Closing, Seller and\nBuyer shall promptly notify the other party in writing of the occurrence of any\nevent which will result, or has a reasonable prospect of resulting, in the\nfailure to satisfy any of the conditions specified in Section 9 or Section 10 of\nthis Agreement.\n\n        7.4 BEST EFFORTS. The Seller shall use its best efforts (i) to cause to\nbe fulfilled and satisfied all of the conditions to the Closing set forth in\nSection 8 below, (ii) to cause to be performed all of the matters required of it\nat the Closing and (iii) to cause the Contracts to be assigned to Buyer.\n\n        7.5 SELLER'S AND SELLER SUB'S CONDUCT OF THE BUSINESS PRIOR TO CLOSING.\nDuring the period from the date of this Agreement to the Closing Date, Seller\nand Seller Sub will\n\n\n                                      -25-\n   26\n\nconduct the Business in its ordinary and usual course, consistent with past\npractice, and will use all reasonable efforts to preserve intact all rights,\nprivileges, franchises and other authority of the Business, to retain the\nEmployees, and to maintain favorable relationships with licensors, licensees,\nsuppliers, contractors, distributors, customers, and others having relationships\nwith the Business. Seller shall promptly notify Buyer of any event or occurrence\nor emergency not in the ordinary course of business, and any material event\ninvolving the Business or the Purchased Assets. Without limiting the generality\nof the foregoing, and except as approved in writing by Buyer in advance, prior\nto the Closing, Seller and Seller Sub:\n\n                (a) will not create, incur or assume any obligation which would\nin any material way affect the Business, the Purchased Assets or Buyer's ability\nto conduct the Business in substantially the same manner and condition as\nconducted by Seller and Seller Sub on the date of this Agreement;\n\n                (b) will not change in any manner the compensation of, or agree\nto provide additional benefits to, or enter into any employment agreement with,\nany Employee;\n\n                (c) will maintain insurance coverage in amounts adequate to\ncover the reasonably anticipated risks of the business conducted with the\nPurchased Assets;\n\n                (d) will not sell, dispose of or encumber any of the Purchased\nAssets or license any Purchased Assets to any Person except in the normal course\nof business consistent with past practice;\n\n                (e) will not enter into any agreements or commitments relating\nto the Business, except on commercially reasonable terms in the ordinary course\nof business of the Business;\n\n                (f) will comply in all material respects with all laws and\nregulations applicable to the Business;\n\n                (g) will not enter into any agreement with any third party for\nthe distribution of any of the Purchased Assets;\n\n                (h) will use reasonable efforts to assist Buyer in employing\nafter the Closing Date the Employees;\n\n                (i) will not change or announce any change to the products or\nservices sold by the Business;\n\n                (j) will not expand the use of the Purchased Assets within the\norganization of Seller or Seller Sub;\n\n                (k) will not violate, amend or otherwise change in any way the\nterms of any of the Contracts;\n\n\n                                      -26-\n   27\n\n                (l) will not commence a lawsuit related to or involving the\nPurchased Assets other than (a) for the routine collection of bills; (b) for\ninjunctive relief on the grounds that Seller or Seller Sub has suffered\nimmediate and irreparable harm not compensable in money damages, provided that\nSeller has obtained the prior written consent of Buyer, such consent not to be\nunreasonably withheld; or (c) for a breach of this Agreement; or\n\n                (m) will not assign, sell or otherwise convey to any third\nparty, without obtaining Buyer's prior written consent, any of the accounts\nreceivable that are applicable to the Business prior to the Closing Date.\n\n        7.6 NO OTHER BIDS. Until the earlier to occur of (a) the Closing or (b)\nthe termination of this Agreement pursuant to its terms, Seller shall not, and\nSeller shall not authorize any of its officers, directors, employees, agents,\nattorneys, accountants, advisors or other representatives to, directly or\nindirectly, (i) initiate, solicit or encourage (including by way of furnishing\ninformation regarding the Business or the Purchased Assets) any inquiries, or\nmake any statements to third parties which may reasonably be expected to lead to\nany proposal concerning the sale of the Business or the Purchased Assets\n(whether by way of merger, purchase of capital shares, purchase of assets or\notherwise), or (ii) negotiate, engage in any substantive discussions, or enter\ninto any agreement, with any Person concerning the sale of the Business or the\nPurchased Assets (whether by way of merger, purchase of capital shares, purchase\nof assets or otherwise). Seller will promptly notify buyer in writing of any\nmaterial inquiry, proposal or offer relating to the foregoing that is received\nby Seller or any of its officers or directors or by any of its stockholders (of\nwhich it is made aware), including the identity and terms of such inquiry,\nproposal or offer.\n\n        7.7 TAX RETURNS. Seller and Seller Sub shall, to the extent that failure\nto do so could adversely affect the Business or the Purchased Assets following\nClosing, (a) continue to file in a timely manner all returns and reports\nrelating to Taxes, and such returns and reports shall be true, correct and\ncomplete in all material respects and shall be subject to the review and consent\nof Buyer which consent shall not be unreasonably withheld, and (b) be\nresponsible for and pay when due any and all Taxes.\n\n        7.8 POST-CLOSING ACCESS TO INFORMATION. If, after the Closing Date, in\norder properly to operate the Business or prepare documents or reports required\nto be filed with governmental authorities or Buyer's financial statements, it is\nnecessary that Buyer obtain additional information within Seller's possession\nrelating to the Purchased Assets or the Business, Seller will furnish or cause\nits representatives to furnish such information to Buyer. Such information shall\ninclude, without limitation, all agreements between Seller or Seller Sub and any\nPerson relating to the Business. Seller shall maintain and make available the\ninformation and records specified in this Section 7.8 for a period of six (6)\nyears after the Closing Date.\n\n        7.9 POST-CLOSING COOPERATION. Seller agrees that, if reasonably\nrequested by Buyer, it will cooperate with Buyer, at Buyer's expense, in\nenforcing the terms of any agreements between Seller or Seller Sub and any third\nparty involving the Business, including without limitation terms relating to\nconfidentiality and the protection of intellectual property rights. In the event\nthat Buyer is unable to enforce its intellectual property rights against a third\nparty as a\n\n\n                                      -27-\n   28\n\nresult of a rule or law barring enforcement of such rights by a transferee of\nsuch rights, Seller agrees to reasonably cooperate with Buyer by assigning to\nBuyer such rights as may be required by Buyer to enforce its intellectual\nproperty rights in its own name. If such assignment still does not permit Buyer\nto enforce its intellectual property rights against the third party, Seller\nagrees to initiate proceedings against such third party in Seller's or Seller\nSub's name, provided that Buyer shall be entitled to participate in such\nproceedings and provided further that Buyer shall be responsible for the\nexpenses of such proceedings.\n\n        7.10 NO POST-CLOSING RETENTION OF COPIES. Immediately after the Closing,\nSeller and Seller Sub shall deliver to Buyer or destroy copies of Purchased\nAssets in Seller's or Seller Sub's possession that are in addition to copies\ndelivered to Buyer as part of the Closing, whether such copies are in paper\nform, on computer media or stored in another form; provided, however, that\nSeller may retain and use copies of financial books and records relating to the\nBusiness as well as other documents required by law to be kept by Seller for the\nsole purpose of preparing its financial statements and statutory accounts.\nSeller and Seller Sub shall not be permitted to use the financial books and\nrecords of the Business for any other reason.\n\n        7.11 PUBLIC ANNOUNCEMENTS. On and prior to the Closing Date, Buyer and\nSeller shall advise and confer with each other prior to the issuance of any\nreports, statements or releases concerning this Agreement (including the\nexhibits and schedules hereto) and the transactions contemplated herein. Neither\nBuyer nor Seller nor Seller Sub will make any public disclosure prior to the\nClosing or with respect to the Closing unless both parties agree on the text and\ntiming of such public disclosure; provided, however, that nothing contained\nherein shall prevent either party at any time from furnishing any information to\nany Governmental Entity. Immediately after this Agreement is signed, both\nparties will make public announcements to their respective share exchanges, as\nmay be applicable; the text of such public announcements will be reviewed by the\nparties prior to release.\n\n        7.12 POST-CLOSING ACTIONS. Subsequent to the Closing Date, Seller and\nSeller Sub shall, from time to time, execute and deliver, upon the request of\nBuyer, all such other and further materials and documents and instruments of\nconveyance, transfer or assignment as may reasonably be requested by Buyer to\neffect, record or verify the transfer to, and vesting in Buyer, of Seller's or\nSeller Sub's right, title and interest in and to the Purchased Assets, free and\nclear of all Liens, other than Liens imposed or arising under the Assumed\nLiabilities, in accordance with the terms of this Agreement.\n\n        7.13 FUTURE AGREEMENTS. In the event Seller or Seller Sub enters into\nany material agreement between the date of this Agreement and the Closing that\nrelates primarily to the Business, at the request of Buyer, Seller and Seller\nSub agree, upon Buyer's request, to include any such agreement within the\nContracts.\n\n        7.14 NON-COMPETITION AGREEMENT.\n\n                (a) In consideration of the Buyer entering into this Agreement,\nSeller and Seller Sub undertake that for one (1) year after the Closing Date,\nSeller and Seller Sub will not, and will not permit any of their respective\nemployees, to:\n\n\n                                      -28-\n   29\n\n                        (i) participate, assist or otherwise be directly or\nindirectly involved or concerned, financially or otherwise, as a member,\ndirector, consultant, adviser, contractor, principal, agent, manager,\nbeneficiary, partner, associate, trustee, financier or otherwise in any business\nor activity whose principal focus is on the development, marketing and sale or\nlicense of software products for the purpose of E-Business Analytics as defined\nbelow (a \"Restricted Business\");\n\n                        (ii) interfere or seek to interfere, directly or\nindirectly, with any relationship between Buyer and any client, customer,\nemployee or supplier of the Business; or\n\n                        (iii) license to any third party which competes with\nBuyer in a Restricted Business Krypton or Titanium on a stand-alone basis for\npurposes of E-Business Analytics.\n\nNotwithstanding the foregoing, items (i)-(iii) above shall not apply to any\nthird party which acquires voting control of Seller or which acquires all or\nsubstantially all of the assets of Seller. For purposes of this Section 7.14,\nE-Business Analytics shall mean: the integration of multiple customer data\npoints including the Web, advertising, demographics and transactions to describe\nand predict customer interests and motivations allowing managers to make\ndecisions that can maximize the return on these investments.\n\n                (b) If any of the separate and independent covenants and\nrestraints referred to in clause (a) of this Section 7.14 are or become invalid\nor unenforceable for any reason then that invalidity or unenforceability will\nnot affect the validity or enforceability of any other separate and independent\ncovenants and restraints.\n\n                (c) If any prohibition or restriction contained in clause (a) of\nthis Section 7.14 is judged to go beyond what is reasonable in the\ncircumstances, but would be judged reasonable if that activity was deleted or\nthat period or area was reduced, then the prohibitions or restrictions apply\nwith that activity deleted or period or area reduced by the minimum amount\nnecessary.\n\n                (d) Seller and Seller Sub acknowledge that:\n\n                        (i) the prohibitions and restrictions contained in\nclause (a) of this Section 7.14 are reasonable and necessary; and\n\n                        (ii) Seller has received valuable consideration for\nagreeing to the covenants in clause (a) of this Section 7.14.\n\n                (e) Seller, Seller Sub and Buyer acknowledge and agree that it\nwill be difficult to compute the amount of damage or loss to Buyer if Seller or\nSeller Sub violated any of their agreements under this Section 7.14, that Buyer\nwill be without an adequate legal remedy if Seller or Seller Sub violated the\nprovisions of this Section 7.14, and that any such violation may cause\nsubstantial irreparable injury and damage to Buyer not fully compensable by\nmonetary damages. Therefore, Seller and Buyer agree that in the event of any\nviolation by Seller or Seller Sub of this Section 7.14, Buyer shall be entitled\n(i) to recover from Seller monetary damages, (ii) to obtain\n\n\n                                      -29-\n   30\n\nspecific performance, injunctive or other equitable relief, of either a\npreliminary or permanent type, and (iii) to seek any other available rights or\nremedies at law or in equity which may be exercised concurrently with the rights\ngranted hereunder.\n\n        7.15 PERMITS. Seller will assist Buyer in obtaining any licenses,\npermits or authorizations required for carrying on the Business but which are\nnot transferable.\n\n        7.16 TAXES. Seller shall be responsible for paying, shall promptly\ndischarge when due, and shall reimburse, indemnify and hold harmless Buyer from,\nany sales or use, transfer, real property gains, excise, stamp, or other similar\nTaxes arising from, imposed on or attributable to the transactions contemplated\nby this Agreement.\n\n        7.17 NASDAQ LISTING OF SECURITIES. Buyer shall prepare and file with the\nNasdaq Stock Market a Notification Form for Listing of Additional Shares with\nrespect to the Securities being issued and sold hereunder, so that such\nSecurities are listed on the Nasdaq Stock Market on or before August 1, 2000.\n\n8. EMPLOYEE MATTERS\n\n        8.1 TRANSFERRED EMPLOYEES.\n\n                (a) OFFER OF EMPLOYMENT. Subject to and in accordance with the\nprovisions of this Section 8, Buyer intends to offer employment to the\nEmployees. Seller and Seller Sub each agrees that it will cooperate with Buyer\nto identify any additional employees of Seller or Seller Sub who are necessary\nfor the conduct the Business. Prior to the Closing, Buyer, after notice to\nSeller as to the timing and method of contact, shall have the right to contact\nany or all of the Employees for the purposes of making offers of employment with\nBuyer (or any Affiliate designated by Buyer) after the Closing Date and\nreceiving written acceptances of such employment (in each case contingent on\nconsummation of the transactions contemplated by this Agreement). Each such\nEmployee who is employed by Seller or Seller Sub on the Closing Date and who\nactually transfers to employment with Buyer (or any Affiliate designated by\nBuyer) at or after the Closing Date as a result of an offer of employment made\nby Buyer is hereafter referred to as a \"Transferred Employee.\" Notwithstanding\nthe foregoing, Buyer shall have no obligation to hire any employees of Seller or\nSeller Sub after the Closing Date.\n\n                (b) TRANSITION. The employment by Seller or Seller Sub, as the\ncase may be, of the Transferred Employees shall end at the close of business on\nthe Closing Date and the employment of the Transferred Employees by Buyer shall\ncommence at 12:01 a.m. on the day after the Closing Date. The terms of\nemployment with Buyer (or Buyer's Affiliates) shall be as mutually agreed to\nbetween each Transferred Employee and Buyer (or Buyer's Affiliate, as the case\nmay be), subject to the provisions of this Section 8.1. Between the date of this\nAgreement and the Closing Date, Seller or Seller Sub, as the case may be, will\nprovide each Transferred Employee with the same level of compensation as that\ncurrently provided by Seller or Seller Sub. Buyer shall have no obligation with\nrespect to payments of salary, compensation, wages, health or similar benefits,\ncommissions, bonuses (deferred or otherwise), severance, stock or stock options\nor any other sums due to any Transferred Employee that accrued before the\nClosing\n\n\n                                      -30-\n   31\n\nDate; and from and after the Closing Date, Seller and Seller Sub shall have no\nobligation with respect to payment of salary, compensation, wages, health\ninsurance or similar benefits, commissions, bonuses (deferred or otherwise),\nseverance, stock or stock options or any other sums due to any Transferred\nEmployee that accrue after the Closing Date and do not pertain to the Employee's\nperiod of employment with Seller or Seller Sub prior to the Closing Date. Seller\nand Seller Sub will be fully responsible for all amounts payable to any\nemployee, including (without limitation) all termination payments, redundancy\ncompensation, severance pay, accrued vacation pay and other amounts payable in\nrespect of the termination of employment of any employee in connection with the\nsale of the Purchased Assets to the Buyer. In addition, Seller and Seller Sub\nwill be fully responsible for all amounts owing to Transferred Employees prior\nto Closing.\n\n                (c) RETENTION OF EMPLOYEES PRIOR TO CLOSING. Seller and Seller\nSub agree to use reasonable efforts to retain the Employees as employees of the\nBusiness until the Closing Date, and to assist Buyer in securing the employment\nafter the Closing Date of the Employees. Neither Seller nor Seller Sub shall\ntransfer any Employee to employment with Seller or Seller Sub outside of the\nBusiness prior to the Closing or without the consent of Buyer. Seller shall\nnotify Buyer promptly if, notwithstanding the foregoing, any Employee terminates\nemployment with Seller or Seller Sub after the date of this Agreement but prior\nto the Closing.\n\n        8.2 COMPENSATION AND BENEFITS OF TRANSFERRED EMPLOYEES. Coverage for\nTransferred Employees under Buyer's compensation and benefit plans and other\nprograms shall commence as of 12:01 a.m. on the day after the Closing Date.\nBuyer shall be free to establish its own employee benefit plans; Buyer shall\nhave no obligation to offer benefit plans of the same type or with terms similar\nto or better than the terms of Seller's and Seller Sub's current employee\nbenefit plans; provided, however, Buyer shall offer compensation packages,\nincluding salary, bonus, stock option grants and other benefit plans\ncommensurate with the same level of employee of Buyer. Buyer shall give each\nTransferred Employee credit for such Transferred Employee's years of most recent\ncontinuous service with Seller or Seller Sub for purposes of determining\nparticipation and benefit levels under all of Buyer's vacation policies and\nbenefit plans and programs.\n\n        8.3 OTHER EMPLOYEES OF THE BUSINESS. With respect to each employee of\nthe Business as of the Closing Date who is not a Transferred Employee (each a\n\"Non-Transferred Employee\"), Seller agrees to either terminate such\nNon-Transferred Employee's employment with Seller or Seller Sub, effective prior\nto the Closing or offer such Non-Transferred Employee continued employment with\nSeller or Seller Sub other than in the Business. Seller further acknowledges\nthat the Non-Transferred Employees shall not be employees of Buyer after the\nClosing.\n\n        8.4 NO RIGHT TO CONTINUED EMPLOYMENT OR BENEFITS. No provision in this\nAgreement shall create any third party beneficiary or other right in any Person\n(including any beneficiary or dependent thereof) for any reason, including,\nwithout limitation, in respect of continued, resumed or new employment with\nSeller, Seller Sub or Buyer (or any Affiliate of Seller or Buyer) or in respect\nof any benefits that may be provided, directly or indirectly, under\n\n\n                                      -31-\n   32\n\nany plan or arrangement maintained by Seller, Seller Sub, Buyer or any Affiliate\nof Seller or Buyer. Except as otherwise expressly provided in this Agreement,\nBuyer is under no obligation to hire any employee of Seller or Seller Sub,\nprovide any employee with any particular benefits, or make any payments or\nprovide any benefits to those employees of Seller or Seller Sub whom Buyer\nchooses not to employ.\n\n        8.5 NO SOLICITATION OR HIRE BY SELLER. For a period of one year after\nthe Closing, Seller and Seller Sub will not solicit any Transferred Employee for\nemployment. For purposes of this Section 8.5, the term \"solicit\" shall not\ninclude the following activities by Seller or Seller Sub: (i) advertising for\nemployment in any bulletin board (including electronic bulletin boards),\nnewspaper, trade journal or other publication available for general distribution\nto the public without specific reference to any particular employees; (ii)\nparticipation in any hiring fair or similar event open to the public not\ntargeted at Buyer's employees; and (iii) use of recruiting or employee search\nfirms that have been instructed by Seller or Seller Sub not to target any\nTransferred Employee.\n\n9. CONDITIONS TO BUYER'S OBLIGATIONS\n\n        The obligations of Buyer under this Agreement are subject to the\nfulfillment, prior to or on the Closing Date, of each of the following\nconditions, all or any of which may be waived by Buyer in writing, except as\notherwise provided by law:\n\n        9.1 REPRESENTATIONS AND WARRANTIES TRUE; PERFORMANCE; CERTIFICATE.\n\n                (a) The representations and warranties of Seller contained in\nthis Agreement shall be true and correct in all material respects as of the\nClosing Date with the same force and effect as though such representations and\nwarranties had been made or given again at and as of the Closing Date;\n\n                (b) Seller and Seller Sub shall have performed and complied with\nall of its agreements, covenants and conditions required by this Agreement to be\nperformed or complied with by them prior to or on the Closing Date; and\n\n                (c) Buyer shall have received a certificate, dated as of the\nClosing Date, signed and verified by an officer of Seller on behalf of Seller\ncertifying to the matters set forth in Sections 9.1(a) and 9.1(b) above.\n\n        9.2 CONSENTS. All Governmental Authorizations, Required Consents and\nconsents required to transfer the Contracts to Buyer on the terms and conditions\nprovided herein, without change as a result of the transfer to Buyer, shall have\nbeen obtained.\n\n        9.3 NO PROCEEDINGS OR LITIGATION.\n\n                (a) No preliminary or permanent injunction or other order shall\nhave been issued by any Governmental Entity, nor shall any statute, rule,\nregulation or executive order be\n\n\n                                      -32-\n   33\n\npromulgated or enacted by any Governmental Entity which prevents the\nconsummation of the transactions contemplated by this Agreement.\n\n                (b) No suit, action, claim, proceeding or investigation before\nany Governmental Entity shall have been commenced and be pending against any of\nthe parties, or any of their respective Affiliates, associates, officers or\ndirectors, seeking to prevent the transactions contemplated by this Agreement,\nincluding, without limitation, the sale of the Purchased Assets or asserting\nthat the sale of the Purchased Assets would be illegal or create liability for\ndamages or which may have a Material Adverse Effect on the Business or the\nPurchased Assets.\n\n        9.4 DOCUMENTS. This Agreement, the exhibits and schedules attached\nhereto, and any other instruments of conveyance and transfer and all other\ndocuments to be delivered by Seller and\/or Seller Sub at the Closing and all\nactions of Seller and Seller Sub required by this Agreement and the exhibit\nagreements, or incidental thereto, and all related matters, shall be in form and\nsubstance reasonably satisfactory to Buyer and Buyer's counsel and shall be in\nfull force and effect.\n\n        9.5 GOVERNMENTAL FILINGS. The parties shall have made any required\nfiling with Governmental Entities in connection with this Agreement and the\nexhibit agreements, and any approvals related thereto shall have been obtained\nor any applicable waiting periods shall have expired. If a proceeding or review\nprocess by a Governmental Entity is pending in which a decision is expected,\nBuyer shall not be required to consummate the transactions contemplated by this\nAgreement until such decision is reached or rendered, notwithstanding Buyer's\nlegal ability to consummate the transactions contemplated by this Agreement\nprior to such decision being reached or rendered.\n\n        9.6 NO MATERIAL ADVERSE CHANGE. There shall have been no material\nadverse change in the Purchased Assets or in the financial condition or results\nof operations of the Business on the Closing Date as compared with the date of\nthis Agreement.\n\n        9.7 LEGAL OPINIONS. Buyer shall have received a legal opinion from\nBrobeck, Phleger &amp; Harrison LLP, legal counsel to Seller, dated the Closing\nDate, in a form reasonably satisfactory to Buyer.\n\n        9.8 REQUIRED APPROVAL. This Agreement and the transactions it\ncontemplates shall have been approved and adopted by Seller's and Seller Sub's\nBoard of Directors and, if applicable, by such vote of the holders of the\noutstanding shares of Seller's capital stock entitled to vote thereon as is\nrequired to approve such transactions, and shall have otherwise been approved as\nrequired by law and the charter documents of Seller and Seller Sub.\n\n        9.9 DEPOSITORY AGREEMENT. Buyer and Seller shall have entered into the\nDepository Agreement in substantially the form attached hereto as Exhibit A, and\nsuch agreement shall remain in full force and effect.\n\n\n                                      -33-\n   34\n\n        9.10 TRANSFER DOCUMENTS. Seller and Seller Sub shall have delivered to\nBuyer the Bill of Sale in substantially the form attached as Exhibit C and with\nrespect to each Contract or item of Intellectual Property, an Assignment and\nAssumption Agreement substantially in the form attached as Exhibit D in each\ncase duly executed by Seller and Seller Sub, and in the aggregate assigning to\nBuyer all of Seller's and Seller Sub's right, title and interest, including all\nrights in the Intellectual Property, in and to the Purchased Assets free and\nclear of all Liens, other than Liens imposed or arising under the Assumed\nLiabilities.\n\n        9.11 EMPLOYEES. Each of the employees of Seller or Seller Sub set forth\non Exhibit E to whom Buyer has offered employment shall have accepted the offer\nof employment with Buyer and shall have agreed to execute Buyer's standard form\nof Confidential Information and Assignment of Inventions Agreement and Buyer\nshall have no reason to believe that each of such Employees would not commence\nemployment with Buyer as of the Closing Date or remain an employee of Buyer for\nat least six months following the Closing Date.\n\n        9.12 SOFTWARE LICENSE. Seller and Buyer shall have executed that certain\nSoftware License Agreement dated as of even date herewith (the \"License\")\npursuant to which Seller grants to Buyer a worldwide non-exclusive license to\nuse, modify, sell, distribute and sublicense KRYPTON and TITANIUM in Buyer's\nproducts, all as more fully set forth in the License, and such License shall\nremain in full force and effect.\n\n10. CONDITIONS TO SELLER'S AND SELLER SUB'S OBLIGATIONS\n\n        The obligations of Seller and Seller Sub under this Agreement are\nsubject to the fulfillment, prior to or on the Closing Date, of each of the\nfollowing conditions, all or any of which may be waived in writing by Seller,\nexcept as otherwise provided by law:\n\n        10.1 REPRESENTATIONS AND WARRANTIES TRUE; PERFORMANCE.\n\n                (a) The representations and warranties of Buyer contained in\nthis Agreement shall be true and correct in all material respects as of the\nClosing Date with the same force and effect as though such representations and\nwarranties had been made or given again at and as of the Closing Date;\n\n                (b) Buyer shall have performed and complied with all of its\nagreements, covenants and conditions required by this Agreement to be performed\nor complied with by them prior to or on the Closing Date;\n\n                (c) Seller shall have received a certificate, dated as of the\nClosing Date, signed and verified by an officer of Buyer on behalf of Buyer\ncertifying to the matters set forth in Sections 10.1(a) and 10.1(b) above.\n\n        10.2 NO PROCEEDING OR LITIGATION.\n\n                (a) No preliminary or permanent injunction or other order shall\nhave been issued by any Governmental Entity, nor shall any statute, rule,\nregulation or executive order be\n\n\n                                      -34-\n   35\n\npromulgated or enacted by any Governmental Entity which prevents the\nconsummation of the transactions contemplated by this Agreement.\n\n                (b) No suit, action, claim, proceeding or investigation before\nany Governmental Entity shall have been commenced and be pending against any of\nthe parties, or any of their respective Affiliates, associates, officers or\ndirectors, seeking to prevent the sale of the Purchased Assets or asserting that\nthe sale of the Assets would be illegal or create liability for damages.\n\n        10.3 DOCUMENTS. This Agreement, any other instruments of conveyance and\ntransfer and all other documents to be delivered by Buyer to Seller at the\nClosing and all actions of Buyer required by this Agreement or incidental\nthereto, and all related matters, shall be in form and substance reasonably\nsatisfactory to Seller and Seller's counsel.\n\n        10.4 GOVERNMENTAL FILINGS. The parties shall have made any filing\nrequired with Governmental Entities, and any approvals shall have been obtained\nor any applicable waiting periods shall have expired. If a proceeding or review\nprocess by a Governmental Entity is pending in which a decision is expected,\nSeller shall not be required to consummate the transactions contemplated by this\nAgreement until such decision is reached or rendered, notwithstanding Seller's\nlegal ability to consummate the transactions contemplated by this Agreement\nprior to such decision being reached or rendered.\n\n        10.5 INVESTORS RIGHTS AGREEMENT. Buyer and Seller shall have executed\nthat certain Investors' Rights Agreement (the \"Investors' Rights Agreement\") in\nsubstantially the form attached hereto as Exhibit F, pursuant to which Buyer\nshall grant Seller certain S-3 registration rights in connection with the\nSecurities being issued and sold hereunder effective August 1, 2000 on a pari\npassu basis with Buyer's existing holders of registrable securities, and such\nagreement shall remain in full force and effect.\n\n11. ESCROW AND INDEMNIFICATION\n\n        11.1 SURVIVAL OF REPRESENTATIONS AND WARRANTIES. All covenants to be\nperformed prior to the Closing Date, and all representations and warranties in\nthis Agreement or in any instrument delivered pursuant to this Agreement shall\nsurvive the consummation of the transactions contemplated hereby and continue\nuntil the first anniversary of the Closing Date (the \"Escrow Termination Date\");\nprovided that if any claims for indemnification have been asserted with respect\nto any such representations, warranties and covenants prior to the Escrow\nTermination Date, the representations, warranties and covenants on which any\nsuch claims are based shall continue in effect until final resolution of any\nclaims, and provided, further, that representations, warranties and covenants\nrelating to Taxes shall survive until 30 days after expiration of all applicable\nstatutes of limitations relating to such Taxes. All covenants which by their\nterms are to be performed after the Closing Date shall continue indefinitely.\n\n        11.2 INDEMNIFICATION. Subject to the limitations set forth in this\nSection 11, from and after the Closing Date, Seller shall protect, defend,\nindemnify and hold harmless Buyer and Buyer's Affiliates, officers, directors,\nemployees, representatives and agents (each of the\n\n\n                                      -35-\n   36\n\nforegoing Persons is hereinafter referred to individually as an \"Indemnified\nPerson\" and collectively as \"Indemnified Persons\") from and against any and all\nlosses, costs, damages, liabilities, fees (including without limitation\nattorneys' fees) and expenses (collectively, the \"Damages\"), that any of the\nIndemnified Persons incurs or reasonably anticipates incurring by reason of or\nin connection with any claim, demand, action or cause of action alleging\nmisrepresentation, breach of, or default in connection with, any of the\nrepresentations, warranties, covenants or agreements of Seller or Seller Sub\ncontained in this Agreement, including any exhibits or schedules attached\nhereto, known to Buyer prior to the Escrow Termination Date. Damages in each\ncase shall be net of the amount of any insurance proceeds and indemnity and\ncontribution actually recovered by Buyer.\n\n        11.3 DAMAGES THRESHOLD. Notwithstanding the foregoing, Buyer may not\nreceive any amount of the Escrow Consideration from the Escrow Fund unless and\nuntil a certificate signed by an officer of Buyer (an \"Officer's Certificate\")\nidentifying Damages in the aggregate amount in excess of $100,000 has been\ndelivered to the Depository Agent and such amount is determined pursuant to this\nSection 11 to be payable, in which case Buyer shall receive Escrow Consideration\nequal in value to the full amount of such Damages without deduction up to the\naggregate amount of Escrow Consideration held in the Escrow Fund. In determining\nthe amount of any Damages attributable to a breach, any materiality standard\ncontained in a representation, warranty or covenant of Acquiror shall be\ndisregarded.\n\n        11.4 ESCROW PERIOD. Subject to the following requirements, the Escrow\nConsideration shall be retained by the Depository Agent until the Escrow\nTermination Date; provided however, that 90,278 shares of Buyer's Common Stock\nheld in escrow shall be released and delivered to Seller as set forth in Section\n4(b) of the Depository Agreement if at least two of Wouter Senf, Iain Robertson,\nFelicity George, and Tom Stones (the \"Key Employees\") remain in the employment\nof Buyer as of the six month anniversary of the Closing Date, excluding any Key\nEmployee who is terminated by Buyer without cause or who terminates his\nemployment with Buyer after the occurrence, if any, of a change of more than 50%\nof the senior management of Buyer (vice president level and above) or a change\nin a Key Employee's principal place of business to more than fifty (50) miles\nfrom its current location. Upon the Escrow Termination Date, the Depository\nAgent shall deliver to the Seller all remaining Escrow Consideration provided,\nhowever, that the amount of Escrow Consideration, which, in the reasonable\njudgment of Buyer, subject to the objection of the Depository Agent and the\nsubsequent arbitration of the claim in the manner provided in the Depository\nAgreement, is necessary to satisfy any unsatisfied claims specified in any\nOfficer's Certificate delivered to the Depository Agent prior to the Escrow\nTermination Date with respect to facts and circumstances existing on or prior to\nthe Escrow Termination Date shall remain in the possession of the Depository\nAgent until such claims have been resolved. As soon as all such claims have been\nresolved, any remaining Escrow Consideration not required to satisfy such claims\nshall be distributed to Seller.\n\n        11.5 RELEASE OF SHARES TO BUYER. Notwithstanding any provision in this\nAgreement to the contrary, the 90,278 shares of Buyer's Common Stock held in\nescrow shall be released and delivered to Buyer as compensation to Buyer for the\nloss of any Key Employee at such time prior to the six month anniversary of the\nClosing Date as a Key Employee does not remain in the\n\n\n                                      -36-\n   37\n\nemployment of Buyer, excluding any Key Employee who is terminated by Buyer\nwithout cause or who terminates his employment with Buyer after the occurrence,\nif any, of a change of more than 50% of the senior management of Buyer (vice\npresident level and above) or a change in a Key Employee's principal place of\nbusiness to more than fifty (50) miles from its current location, all as more\nfully set forth in Section 4(b) of the Depository Agreement.\n\n        11.6 METHOD OF ASSERTING CLAIMS. All claims for indemnification by the\nBuyer or any other Indemnified Person pursuant to this Section 11 shall be made\nin accordance with the provisions of the Depository Agreement.\n\n        11.7 APPOINTMENT OF SELLER'S AGENT. Seller hereby appoints John Reece,\nor his successor as Chief Financial Officer of Seller, to act as its agent and\nattorney-in-fact (\"Seller's Agent\") with respect to the Escrow Consideration to\nbe delivered to Depository Agent pursuant to Section 2.5 herein above, and to\nact on its behalf pursuant to the terms set forth in the Depository Agreement.\n\n12. TERMINATION.\n\n        12.1 TERMINATION OF AGREEMENT. This Agreement may be terminated at any\ntime prior to the Closing:\n\n                (a) By mutual written consent of Buyer and Seller; or\n\n                (b) By Buyer or Seller, if the other party goes into\nliquidation, has an application or order made for its winding up or dissolution,\nhas a resolution passed or steps taken to pass a resolution for its winding up\nor dissolution, becomes unable to pay its debts as and when they fall due, or\nhas a receiver, receiver and manager, administrator, liquidator, provisional\nliquidator, official manager or administrator appointed to it or any of its\nassets; or\n\n                (c) By Buyer or Seller if any Governmental Entity shall have\nissued an order, decree or ruling or taken any other action restraining,\nenjoining or otherwise prohibiting the transactions contemplated by this\nAgreement; or\n\n                (d) By Buyer or Seller if the Closing does not occur by July 15,\n2000.\n\n        12.2 PROCEDURE AND EFFECT OF TERMINATION. In the event of termination of\nthis Agreement by either Buyer or Seller pursuant to Section 12.1, written\nnotice shall be given to the other parties specifying the provision of Section\n12.1 pursuant to which such termination is made and shall become void and there\nshall be no liability on the part of Buyer, Seller or Seller Sub (or their\nrespective officers, directors, partners or Affiliates), except as a result of\nany breach of this Agreement by such party or to the extent such party is\nentitled to indemnification under Section 11 of this Agreement.\n\n\n                                      -37-\n   38\n\n13. MISCELLANEOUS.\n\n        13.1 AMENDMENTS AND WAIVERS. Any term of this Agreement may be amended\nor waived with the written consent of the parties or their respective successors\nand assigns. Any amendment or waiver effected in accordance with this Section\n13.1 shall be binding upon the parties and their respective successors and\nassigns.\n\n        13.2 SUCCESSORS AND ASSIGNS. The terms and conditions of this Agreement\nshall inure to the benefit of and be binding upon the respective successors and\nassigns of the parties. Nothing in this Agreement, express or implied, is\nintended to confer upon any party other than the parties hereto or their\nrespective successors and assigns any rights, remedies, obligations, or\nliabilities under or by reason of this Agreement, except as expressly provided\nin this Agreement.\n\n        13.3 GOVERNING LAW; JURISDICTION. This Agreement and all acts and\ntransactions pursuant hereto and the rights and obligations of the parties\nhereto shall be governed, construed and interpreted in accordance with the laws\nof the State of California, without giving effect to principles of conflicts of\nlaw. Each of the parties to this Agreement consents to the exclusive\njurisdiction and venue of the courts of the state and federal courts of Alameda\nCounty, California.\n\n        13.4 COUNTERPARTS. This Agreement may be executed in two or more\ncounterparts, each of which shall be deemed an original and all of which\ntogether shall constitute one instrument.\n\n        13.5 TITLES AND SUBTITLES. The titles and subtitles used in this\nAgreement are used for convenience only and are not to be considered in\nconstruing or interpreting this Agreement.\n\n        13.6 NOTICES. Any notice required or permitted by this Agreement shall\nbe in writing and shall be deemed sufficient upon receipt, when delivered\npersonally or by courier, overnight delivery service or confirmed facsimile, or\nforty-eight (48) hours after being deposited in the regular mail as certified or\nregistered mail (airmail if sent internationally) with postage prepaid, if such\nnotice is addressed to the party to be notified at such party's address or\nfacsimile number as set forth on the signature page hereto, or as subsequently\nmodified by written notice.\n\n        13.7 SEVERABILITY. If one or more provisions of this Agreement are held\nto be unenforceable under applicable law, the parties agree to renegotiate such\nprovision in good faith, in order to maintain the economic position enjoyed by\neach party as close as possible to that under the provision rendered\nunenforceable. In the event that the parties cannot reach a mutually agreeable\nand enforceable replacement for such provision, then (i) such provision shall be\nexcluded from this Agreement, (ii) the balance of the Agreement shall be\ninterpreted as if such provision were so excluded and (iii) the balance of the\nAgreement shall be enforceable in accordance with its terms.\n\n        13.8 ENTIRE AGREEMENT. This Agreement, together with the exhibits and\nother documents referred to herein are the product of both of the parties\nhereto, and constitute the entire agreement between such parties pertaining to\nthe subject matter hereof and thereof, and\n\n\n                                      -38-\n   39\n\nmerges all prior negotiations and drafts of the parties with regard to the\ntransactions contemplated herein and therein. Any and all other written or oral\nagreements existing between the parties hereto regarding such transactions are\nexpressly canceled.\n\n        13.9 ADVICE OF LEGAL COUNSEL. Each party acknowledges and represents\nthat, in executing this Agreement, it has had the opportunity to seek advice as\nto its legal rights from legal counsel and that the person signing on its behalf\nhas read and understood all of the terms and provisions of this Agreement. This\nAgreement shall not be construed against any party by reason of the drafting or\npreparation thereof.\n\n        13.10 FEES AND EXPENSES. Each party shall bear its own fees and expenses\n(including the fees and expenses of its financial, legal, accounting and other\nadvisors) incurred in the negotiation, documentation and delivery of the\nAgreement and the transactions contemplated hereby, whether or not the Closing\noccurs.\n\n                            [Signature pages follow]\n\n\n                                      -39-\n   40\n\n        This Agreement has been duly executed and delivered by the duly\nauthorized officers of Seller, Seller Sub and Buyer as of the date first above\nwritten.\n\n\n                                            ACCRUE SOFTWARE, INC.\n\n\n                                            By:\n                                               ---------------------------------\n\n                                            Name:\n                                                 -------------------------------\n\n                                            Title:\n                                                  ------------------------------\n\n                                            Address:\n                                                    ----------------------------\n\n                                                    ----------------------------\n\n                                            Fax Number:\n                                                       -------------------------\n\n\n                                            TANTAU SOFTWARE, INC.\n\n\n                                            By:\n                                               ---------------------------------\n\n                                            Name:\n                                                 -------------------------------\n\n                                            Title:\n                                                  ------------------------------\n\n                                            Address:\n                                                    ----------------------------\n\n                                                    ----------------------------\n\n                                            Fax Number:\n                                                       -------------------------\n\n\n                                      -40-\n   41\n\n                                            TANTAU SOFTWARE INTERNATIONAL, INC.\n\n\n                                            By:\n                                               ---------------------------------\n\n                                            Name:\n                                                 -------------------------------\n\n                                            Title:\n                                                  ------------------------------\n\n                                            Address:\n                                                    ----------------------------\n\n                                                    ----------------------------\n\n                                            Fax Number:\n                                                       -------------------------\n\n\n                                      -41-\n   42\n\n                                  EXHIBIT INDEX\n\n\n\n\nExhibit A                    Depository Agreement\n\nExhibit B                    Allocation of Purchase Price\n\nExhibit C                    Bill of Sale\n\nExhibit D                    Assignment and Assumption Agreement\n\nExhibit E                    Employees\n\nExhibit F                    Investors' Rights Agreement\n\n\n<\/pre>\n","protected":false},"template":"","meta":{"_acf_changed":false,"_stopmodifiedupdate":true,"_modified_date":"","_cloudinary_featured_overwrite":false},"corporate_contracts_companies":[6556],"corporate_contracts_industries":[9513],"corporate_contracts_types":[9623,9622],"class_list":["post-43273","corporate_contracts","type-corporate_contracts","status-publish","hentry","corporate_contracts_companies-accrue-software-inc","corporate_contracts_industries-technology__software","corporate_contracts_types-planning__asset","corporate_contracts_types-planning"],"acf":[],"_links":{"self":[{"href":"https:\/\/corporate.findlaw.com\/legal-api\/wp-json\/wp\/v2\/corporate_contracts\/43273","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/corporate.findlaw.com\/legal-api\/wp-json\/wp\/v2\/corporate_contracts"}],"about":[{"href":"https:\/\/corporate.findlaw.com\/legal-api\/wp-json\/wp\/v2\/types\/corporate_contracts"}],"wp:attachment":[{"href":"https:\/\/corporate.findlaw.com\/legal-api\/wp-json\/wp\/v2\/media?parent=43273"}],"wp:term":[{"taxonomy":"corporate_contracts_companies","embeddable":true,"href":"https:\/\/corporate.findlaw.com\/legal-api\/wp-json\/wp\/v2\/corporate_contracts_companies?post=43273"},{"taxonomy":"corporate_contracts_industries","embeddable":true,"href":"https:\/\/corporate.findlaw.com\/legal-api\/wp-json\/wp\/v2\/corporate_contracts_industries?post=43273"},{"taxonomy":"corporate_contracts_types","embeddable":true,"href":"https:\/\/corporate.findlaw.com\/legal-api\/wp-json\/wp\/v2\/corporate_contracts_types?post=43273"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}