\nSection 13.6 Severability………………………………………………………….. 59
\nSection 13.7 Governing Law…………………………………………………………. 60
\nSection 13.8 Venue………………………………………………………………… 60
\nSection 13.9 Extension; Waiver……………………………………………………… 60
\nSection 13.10 Assignment; Successors…………………………………………………. 60
\nSection 13.11 Survival……………………………………………………………… 60
\nSection 13.12 Waiver of Right to Jury………………………………………………… 60
\n<\/c><\/c><\/s><\/caption>\n<\/table>\nATTACHMENTS<\/p>\n
Company Disclosure Schedule
\nParent Disclosure Schedule<\/p>\n
Schedule 6.1 Interim Operations
\nSchedule 7.4(b) Benefit Plans
\nSchedule 8.2(d) Necessary Consents<\/p>\n
EXHIBIT A: Written Consent of Stockholders
\nEXHIBIT B: Escrow Agreement
\nEXHIBIT D: Bill of Sale
\nEXHIBIT E: Assignment and Assumption Agreement
\nEXHIBIT F: Registration Rights Agreement
\nEXHIBIT G: Voting Agreement<\/p>\n
ASSET PURCHASE AGREEMENT<\/p>\n
This ASSET PURCHASE AGREEMENT, dated as of February 18, 2003
\n(this “Agreement”), is entered into by and among Overture Services, Inc.
\n(“Parent”), a Delaware corporation, AltaVista Company, a Delaware corporation
\n(the “Company”), Aurora I, LLC, a Delaware limited liability company of which
\nthe Company is the sole member (“Aurora”), and CMGI, Inc., a Delaware
\ncorporation (“Principal Stockholder”). Certain capitalized terms used in this
\nAgreement have the meanings assigned to them in Article XII.<\/p>\n
WHEREAS, the Company desires to sell, assign, transfer, convey
\nand deliver to Parent, and Parent desires to purchase and assume from the
\nCompany, on the terms and subject to the conditions set forth in this Agreement,
\nthe Acquired Assets and Assumed Liabilities, by, among other things, acquiring
\nall of the equity interests in Aurora pursuant to the terms and conditions
\nhereof;<\/p>\n
WHEREAS, holders of shares of the Company’s outstanding
\ncapital stock collectively representing in excess of eighty percent (80%) of the
\nvoting power of the Company have approved this Agreement and the transactions
\ncontemplated hereby (the “Transactions”), upon the terms and subject to the
\nconditions set forth herein, in accordance with the Delaware General Corporation
\nLaw (the “DGCL”) and the Company’s Certificate of Incorporation and Bylaws, by
\nexecuting the written consent of stockholders in the form attached hereto as
\nExhibit A (the “Stockholder Consent”); and<\/p>\n
WHEREAS, as a condition and inducement to Parent to enter into
\nthis Agreement and incur the obligations set forth herein, at the Closing,
\nParent, the Company and the Escrow Agent named therein shall enter into an
\nescrow agreement substantially in the form attached hereto as Exhibit B (with
\nsuch changes as the Escrow Agent may reasonably request, the “Escrow
\nAgreement”), pursuant to which the Company shall place a portion of the Purchase
\nPrice in an escrow account to secure certain indemnification obligations to
\nParent; and<\/p>\n
NOW, THEREFORE, in consideration of the foregoing and the
\nmutual representations, warranties, covenants and agreements set forth herein,
\nand for other valuable consideration, the receipt and sufficiency of which are
\nhereby acknowledged, intending to be legally bound hereby, the parties hereto
\nagree as follows:<\/p>\n
ARTICLE I<\/p>\n
PURCHASE AND SALE OF ACQUIRED ASSETS
\n AND ASSUMPTION OF ASSUMED LIABILITIES<\/p>\n
Section 1.1 Purchase and Sale of Assets. Upon the terms and
\nsubject to the conditions set forth in this Agreement, at the Closing, the
\nCompany agrees to sell, assign, transfer, and convey to Parent, and Parent
\nagrees to purchase, all of the Acquired Assets.<\/p>\n
Section 1.2 Assumption of Liabilities. Upon the terms and
\nsubject to the conditions set forth in this Agreement, at the Closing, Parent
\nshall assume and become<\/p>\n
responsible for, and shall pay, perform and discharge when due, and shall
\nindemnify the Company against and hold harmless from, and the Company shall
\nassign to Parent, all of the Assumed Liabilities.<\/p>\n
Section 1.3 Purchase Price.<\/p>\n
(a) Subject to the terms and conditions of the
\nAgreement, in consideration of the sale, assignment, transfer and conveyance to
\nParent of the Acquired Assets, at the Closing, Parent shall:<\/p>\n
(i) pay to the Company sixty million dollars
\n ($60,000,000) in cash by wire transfer of immediately available funds
\n (the “Cash Consideration”); and<\/p>\n
(ii) issue to the Company a number of shares
\n of Parent’s common stock, par value $0.0001 per share (the “Parent
\n Common Stock”), determined by dividing eighty million dollars
\n ($80,000,000) by the average closing price at the end of normal trading
\n hours (the “Average Closing Price”) of a share of Parent Common Stock
\n on the Nasdaq National Market or such other principal securities
\n exchange on which the Parent Common Stock shall then be trading for the
\n twenty (20) consecutive trading days ending at the end of the second
\n trading day prior to the Closing Date (the “Stock Consideration” and,
\n together with the Cash Consideration, the “Purchase Price”); provided,
\n that Parent shall not be required to issue more than 4,274,670 shares
\n of Parent Common Stock or less than 3,001,364 shares of Parent Common
\n Stock to the Company pursuant to this Agreement; and<\/p>\n
(iii) assume the Assumed Liabilities.<\/p>\n
Section 1.4 Escrow. Ten percent (10%) of each of the Cash
\nConsideration and the Stock Consideration (the “Escrow Amount”) shall be
\ndeposited by the Company within one (1) Business Day after the Closing, by wire
\ntransfer of immediately available funds, in the case of the Cash Consideration,
\nand shares of Parent Common Stock, in the case of the Stock Consideration, into
\nescrow pursuant to the terms of the Escrow Agreement for the purpose of
\nsatisfying indemnification claims pursuant to Article XI hereof.<\/p>\n
Section 1.5 Allocation of Purchase Price and Assumed
\nLiabilities. The Company shall agree to an allocation of the Purchase Price and
\nthe Assumed Liabilities among the Acquired Assets in accordance with Section
\n1060 of the Code and the regulations promulgated thereunder (and any similar
\nprovision of state, local or foreign law, as applicable) pursuant to an
\nindependent third party retained by Parent to in good faith prepare and deliver
\nsuch allocation to the Company within thirty (30) calendar days of the date of
\nthis Agreement. To the extent that the Company or the Principal Stockholder is
\nrequired to pay any Damages, an appropriate adjustments to the allocation of the
\nPurchase Price, as required by GAAP, shall be made at such time among the
\nAcquired Assets. Each of Parent and the Company shall: (a) timely file all forms
\n(including Internal Revenue Service Form 8594) and Tax Returns required to be
\nfiled in connection with the Final Allocation; (b) be bound by such Final
\nAllocation for<\/p>\n
2<\/p>\n
purposes of determining Taxes; (c) prepare and file, and cause its respective
\nAffiliates to prepare and file, its Tax Returns on a basis consistent with such
\nFinal Allocation; and (d) take no position, and cause its Affiliates to take no
\nposition, inconsistent with such allocation on any applicable Tax Return, in any
\naudit or proceeding before any Tax Authority, in any report made for Tax,
\nfinancial accounting or any other purposes, or otherwise. In the event that the
\nFinal Allocation is disputed by any Tax Authority, the party receiving notice of
\nsuch dispute shall promptly notify the other parties hereto concerning the
\nexistence and resolution of such dispute.<\/p>\n
ARTICLE II<\/p>\n
CLOSING<\/p>\n
Section 2.1 The Closing. The closing of the Transactions (the
\n“Closing”) shall take place at: (a) the offices of Skadden, Arps, Slate, Meagher
\n& Flom LLP, 525 University Avenue, Suite 1100, Palo Alto, California 94301 at
\n6:00 a.m., California time, two (2) Business Days following the date on which
\nall conditions to the Closing set forth in Article VIII shall have been
\nsatisfied or waived in accordance with this Agreement (other than those
\nconditions that are contemplated to be satisfied prior to the Closing); or (b)
\nat such other place, time and date as agreed in writing by Parent and the
\nCompany (the “Closing Date”).<\/p>\n
Section 2.2 Deliveries by the Company. At the Closing, the
\nCompany shall deliver to Parent:<\/p>\n
(a) a duly executed bill of sale in the form attached
\nhereto as Exhibit D (the “Bill of Sale”);<\/p>\n
(b) executed copies of the Consents, to the extent
\nobtained, and the Necessary Consents;<\/p>\n
(c) the Company Officer’s Certificate referred to in
\nSection 8.2(g) hereof;<\/p>\n
(d) the Company Secretary’s Certificate referred to
\nin Section 8.2(h) hereof;<\/p>\n
(e) a certification of non-foreign status for the
\nCompany in the form and manner which complies with the requirements of Section
\n1445 of the Code and the regulations promulgated thereunder;<\/p>\n
(f) executed copies of each of the Ancillary
\nAgreements; and<\/p>\n
(g) stock certificates representing all of the
\noutstanding equity securities of or membership interests in each of the Company
\nSubsidiaries.<\/p>\n
Section 2.3 Deliveries by Parent. At the Closing, Parent
\nshall deliver to the Company:<\/p>\n
(a) the Purchase Price;<\/p>\n
3<\/p>\n
(b) a duly executed assignment and assumption
\nagreement in the form attached hereto as Exhibit E (the “Assignment and
\nAssumption Agreement”);<\/p>\n
(c) the Parent Officer’s Certificate referred to in
\nSection 8.3(d) hereof;<\/p>\n
(d) the Parent Secretary’s Certificate referred to in
\nSection 8.3(e) hereof; and<\/p>\n
(e) executed copies of each of the Ancillary
\nAgreements.<\/p>\n
Section 2.4 Deliveries by Principal Stockholder. At the
\nClosing, Principal Stockholder, shall deliver to Parent:<\/p>\n
(a) executed copies of the applicable Ancillary
\nAgreements;<\/p>\n
(b) the Principal Stockholder Officer’s Certificate
\nreferred to in Section 8.2(i) hereof; and<\/p>\n
(c) the Principal Stockholder Assistant Secretary’s
\nCertificate referred to in Section 8.2(j) hereof.<\/p>\n
ARTICLE III<\/p>\n
REPRESENTATIONS AND WARRANTIES OF THE COMPANY<\/p>\n
Except as set forth in the Company Disclosure Schedule,
\nprepared and signed by the Company and delivered to Parent simultaneously with
\nthe execution hereof, the Company represents and warrants to Parent that all of
\nthe statements contained in this Article III are true and correct. For purposes
\nof the representations and warranties of the Company contained herein,
\ndisclosure in any section of the Company Disclosure Schedule of any facts or
\ncircumstances shall be deemed to be disclosure of such facts or circumstances
\nwith respect to such other representations or warranties by the Company calling
\nfor disclosure of such information if such disclosure would reasonably lead
\nParent to make further inquiry of such facts and circumstances, and such further
\ninquiry would reasonably reveal that such disclosure applies to such other
\nrepresentations and warranties. The inclusion of any information in any section
\nof the Company Disclosure Schedule or other document delivered by the Company
\npursuant to this Agreement shall not be deemed to be an admission or evidence of
\nthe materiality of such item, nor shall it establish a standard of materiality
\nfor any purpose whatsoever.<\/p>\n
4<\/p>\n
Section 3.1 Organization. The Company is a corporation duly
\norganized, validly existing and in good standing under the laws of Delaware and
\nhas all requisite corporate or other power and authority and all necessary
\ngovernmental approvals to own, lease and operate its properties and to carry on
\nits business as now being conducted, except where the failure to be so
\norganized, existing and in good standing or to have such power, authority, and
\ngovernmental approvals would not have, individually or in the aggregate, a
\nCompany Material Adverse Effect.<\/p>\n
Section 3.2 Authorization. Each of the Company and Aurora has
\nall requisite power and authority to execute and deliver this Agreement and to
\nconsummate the Transactions. The execution, delivery and performance by the
\nCompany of this Agreement and the consummation of the Transactions by the
\nCompany have been duly authorized by the Board of Directors of the Company and
\napproved by the holders of the requisite number of voting shares of the
\nCompany’s capital stock in accordance with the DGCL and the Company’s
\nCertificate of Incorporation and Bylaws. No other corporate or similar action on
\nthe part of the Company or Aurora is necessary to authorize the execution and
\ndelivery of this Agreement by the Company or Aurora or the consummation by the
\nCompany or Aurora of any of the Transactions.<\/p>\n
Section 3.3 Execution; Validity of Agreement. This Agreement
\nhas been duly executed and delivered by the Company and Aurora, and, assuming
\ndue and valid authorization, execution and delivery hereof by Principal
\nStockholder and Parent is a valid and binding obligation of the Company and
\nAurora, enforceable against them in accordance with its terms except (a) as
\nlimited by applicable bankruptcy, insolvency, reorganization, moratorium,
\nfraudulent conveyance and other similar Laws of general application affecting
\nenforcement of creditors’ rights generally and (b) the availability of the
\nremedy of specific performance or injunctive or other forms of equitable relief
\nmay be subject to equitable defenses and would be subject to the discretion of
\nthe court before which any proceeding therefor may be brought.<\/p>\n
Section 3.4 Consents and Approvals; No Violations. Except for
\nthe filings, permits, authorizations, consents and approvals as may be required
\nunder, and other applicable requirements of, the Securities Act, the Exchange
\nAct, the HSR Act, applicable foreign antitrust Laws, and state securities laws,
\nnone of the execution, delivery or performance of this Agreement by the Company,
\nthe consummation by the Company of the Transactions or compliance by the Company
\nwith any of the provisions hereof shall: (w) conflict with or result in any
\nbreach of any provision of the Company’s Certificate of Incorporation or Bylaws
\nas presently in effect; (x) require any filing with, or permit, authorization,
\nconsent or approval of, any Governmental Entity; (y) result in a violation or
\nbreach of, or constitute (with or without due notice or lapse of time or both) a
\ndefault (or give rise to any right of termination, cancellation or acceleration)
\nunder, any of the terms, conditions or provisions of any Company Material
\nContract; or (z) violate any order, writ, injunction, decree, statute, rule or
\nregulation applicable to the Company.<\/p>\n
Section 3.5 Company Subsidiaries. Section 3.5 of the Company
\nDisclosure Schedule sets forth the name, jurisdiction of incorporation and
\nauthorized capital of each Company Subsidiary. All the outstanding capital stock
\nof each Company Subsidiary is owned directly or indirectly by the Company, free
\nand clear of all Encumbrances, and is validly issued, fully paid and
\nnonassessable. Each Company Subsidiary: (a) is a corporation or limited
\nliability company duly organized, validly existing and in good standing under
\nthe laws of its jurisdiction<\/p>\n
5<\/p>\n
of incorporation; (b) has all corporate or other similar power and authority and
\nall necessary government approvals to own, lease and operate its properties and
\nto carry on its business as it is now being conducted and to own the properties
\nand assets it now owns; and (c) is duly qualified or licensed to conduct its
\nbusiness as a foreign entity in good standing in every jurisdiction in which
\nsuch qualification or license is required, except, in the case of the foregoing
\nclauses (a), (b) and (c), where the failure to be so organized, existing and in
\ngood standing, to have such power, authority and governmental approvals, and to
\nbe so qualified or licensed, would not have, individually or in the aggregate, a
\nCompany Material Adverse Effect. There are no shares of capital stock of any
\nCompany Subsidiary issued or outstanding that are not owned directly or
\nindirectly by the Company and there are no existing options, warrants, calls,
\npre-emptive rights, subscriptions or other rights, agreements, arrangements or
\ncommitments of any character, obligating any Company Subsidiary to issue,
\ntransfer or sell or cause to be issued, transferred or sold any shares of
\ncapital stock of any Company Subsidiary.<\/p>\n
Section 3.6 Financial Statements. True and complete copies of
\nthe Financial Statements are included in Section 3.6 of the Company Disclosure
\nSchedule. The Financial Statements have been prepared in accordance with GAAP
\napplied on a consistent basis during the periods involved and with each other
\nwithin the same period and fairly present the consolidated financial position
\nand the consolidated results of operations and cash flows of the Company and the
\nCompany Subsidiaries as of the times and for the periods referred to therein;
\nprovided, however, that the Financial Statements are subject to normal recurring
\nyear-end audit adjustments, and do not contain all footnotes required under
\nGAAP.<\/p>\n
Section 3.7 No Undisclosed Liabilities. Except for threatened
\nor pending litigation set forth on Section 3.13 of, or as otherwise included in,
\nthe Company Disclosure Schedule or this Agreement, liabilities and obligations
\nreflected in the Balance Sheet or incurred in the ordinary course of business
\nsince the Balance Sheet Date, neither the Company nor any Company Subsidiary has
\nany liabilities or obligations that are material to the Company and the Company
\nSubsidiaries, taken as a whole, individually or in the aggregate, and that would
\nbe required to be disclosed in a consolidated balance sheet of the Company
\n(including the related notes thereto, where appropriate) prepared in accordance
\nwith GAAP.<\/p>\n
Section 3.8 Absence of Certain Changes. Except as (a)
\ndisclosed in the Financial Statements, this Agreement or the Company Disclosure
\nSchedule or (b) expressly required by this Agreement, since the Balance Sheet
\nDate through the date of this Agreement, no event that would be reasonably
\nlikely to result in a Company Material Adverse Effect has occurred.<\/p>\n
Section 3.9 Encumbrances. The Company and each Company
\nSubsidiary has good title to the Acquired Assets, free and clear of all
\nEncumbrances.<\/p>\n
Section 3.10 Real Property. The Company does not own, and has
\nnever owned, any real property.<\/p>\n
Section 3.11 Leases. Section 3.11 of the Company Disclosure
\nSchedule sets forth a complete and correct list of all Leases, each of which has
\nbeen made available to Parent. Each Lease is valid, binding and enforceable in
\naccordance with its terms and is in full force and<\/p>\n
6<\/p>\n
effect. There is no existing material default by the Company or any Company
\nSubsidiary under any of the Leases.<\/p>\n
Section 3.12 Company Contracts and Commitments.<\/p>\n
(a) Section 3.12 of the Company Disclosure Schedule
\nsets forth a true, complete and correct list of every Contract (other than the
\nLeases, which are addressed in Section 3.11 and such Licenses as are addressed
\nin Section 3.18(c)) that is currently in effect as of the date of this Agreement
\nand: (i) provides for future payments by the Company or any Company Subsidiary,
\nor to the Company or any Company Subsidiary, of more than $100,000 per annum and
\nmay not be canceled upon sixty (60) days’ notice without any liability, penalty
\nor premium (excluding purchase orders, invoices, leasing transactions and
\nadvertising agreements, in any such case, which were entered into or incurred in
\nthe ordinary course of business); (ii) was entered into by the Company or a
\nCompany Subsidiary with a current stockholder, current executive officer or
\ncurrent director of the Company or any Company Subsidiary; (iii) is a collective
\nbargaining or similar agreement; (iv) involves an agreement with respect to any
\nIndebtedness of the Company or any Company Subsidiary; (v) materially restricts
\nany conduct of any business in any location by the Company or any Company
\nSubsidiary; (vi) is an employment agreement with a current executive officer or
\ncurrent director, or consulting agreement with an individual involving payments
\nby the Company in excess of $100,000 per annum; (vii) is a material joint
\nventure agreement or partnership agreement to which the Company or any Company
\nSubsidiary is a party or is otherwise bound; (viii) is an agreement to which the
\nCompany or any Company Subsidiary is a party or is otherwise bound that contains
\nexplicit terms providing for material benefits (which shall not be interpreted
\nto include cancellation or termination) to the other party that may be
\ntriggered, increased or accelerated by this Agreement, any of the Ancillary
\nAgreements or the consummation of the Transactions; or (ix) is an agreement to
\nwhich the Company or any Company Subsidiary is a party or is otherwise bound,
\nentered into other than in the ordinary course of business, that includes terms
\nor provisions obligating the Company or any Company Subsidiary to provide
\nindemnification (other than in agreements where such indemnification is provided
\nin the ordinary course of business) or any other guarantee to any Person.<\/p>\n
(b) As of the date hereof, (i) there is not and, to
\nthe Knowledge of the Company, there has not been claimed or alleged by any
\nPerson with respect to any Contract required to be listed in Section 3.12 of the
\nCompany Disclosure Schedule (together with the Leases and such Licenses required
\nto be listed on Section 3.18(c) of the Company Disclosure Schedule, such
\nContracts, the “Company Material Contracts”), any existing default or event
\nthat, with notice or lapse of time or both, would constitute a default or, event
\nof default on the part of the Company or any Company Subsidiary or, to the
\nKnowledge of the Company, on the part of any other party thereto, except such
\ndefaults, events of default and other events which are not material, and (ii) no
\nconsent, approval, authorization or waiver from, or notice to, any Governmental
\nEntity or other Person is required in order to maintain in full force and effect
\nany of the Company Material Contracts as a result of the Transactions other than
\nsuch consents and waivers that have been obtained and are unconditional and in
\nfull force and effect and such notices that have been duly given.<\/p>\n
7<\/p>\n
Section 3.13 Litigation. As of the date of this Agreement,
\nthere is no action, suit, inquiry, proceeding or investigation by or before any
\ncourt or other Governmental Entity pending or, to the Knowledge of the Company,
\nthreatened against the Company or any Company Subsidiary.<\/p>\n
Section 3.14 Environmental Matters. To the Knowledge of the
\nCompany, (a) the Company and each Company Subsidiary are in material compliance
\nwith all applicable Environmental Laws; (b) neither the Company nor any Company
\nSubsidiary has received any written notice with respect to any property owned or
\nleased by the Company or any Company Subsidiary from any Governmental Entity or
\nthird party alleging that the Company or any Company Subsidiary is not in
\nmaterial compliance with any Environmental Law; and (c) there has been no
\n“release” of a “hazardous substance,” as those terms are defined in the
\nComprehensive Environmental Response, Compensation, and Liability Act, 42 U.S.C.
\nSection 9601 et seq., in excess of a reportable quantity which release remains
\nunresolved on any real property owned by the Company or any Company Subsidiary.<\/p>\n
Section 3.15 Compliance with Laws. The Company and the
\nCompany Subsidiaries have complied in a timely manner and in all material
\nrespects with all Laws that apply to the properties or assets owned by the
\nCompany or any Company Subsidiary, except for violations that would not
\nconstitute a Company Material Adverse Effect.<\/p>\n
Section 3.16 Employee Benefit Plans.<\/p>\n
(a) Section 3.16 of the Company Disclosure Schedule
\ncontains a true and complete list of all Benefit Plans. The Company has provided
\nor made available to Parent: (i) correct and complete copies of all documents
\nembodying each Benefit Plan including, without limitation, all amendments
\nthereto and all related trust documents; (ii) the most recent annual reports
\n(Form Series 5500 and all schedules and financial statements attached thereto),
\nif any, required under ERISA or the Code in connection with each Benefit Plan;
\n(iii) if the Benefit Plan is funded, the most recent annual and periodic
\naccounting of Benefit Plan assets; (iv) the most recent summary plan description
\ntogether with the summary(ies) of material modifications thereto, if any,
\nrequired under ERISA with respect to each Benefit Plan; (v) all material written
\nagreements and contracts relating to each Benefit Plan, including, without
\nlimitation, administrative service agreements and group insurance contracts;
\n(vi) all communications material to any employee or employees relating to any
\nBenefit Plan, relating to any amendments, terminations, establishments,
\nincreases or decreases in benefits, acceleration of payments or vesting
\nschedules or other events which would result in any liability to the Company;
\n(vii) all material correspondence to or from any Governmental Entity relating to
\nany Benefit Plan; (viii) all discrimination tests for each Benefit Plan for the
\nmost recent plan years; and (ix) the most recent IRS determination or opinion
\nletter issued with respect to each Benefit Plan, if applicable.<\/p>\n
(b) With respect to those Benefit Plans that are
\nbeing assumed by the Parent as set forth on Schedule 7.4(b), the Company and
\neach Company Subsidiary has performed all obligations required to be performed
\nby them under, are not in material default or violation of, and to the Knowledge
\nof the Company and Principal Stockholder, there is no default or violation by
\nany other party to any such Benefit Plan, and each such Benefit Plan has been
\nestablished and maintained in accordance with its terms and in compliance in all
\nmaterial<\/p>\n
8<\/p>\n
respects with all applicable Laws, including but not limited to ERISA and the
\nCode. Each such Benefit Plan intended to qualify under Section 401(a) of the
\nCode and each trust intended to qualify under Section 501(a) of the Code is so
\nqualified, and has received a favorable determination letter from the IRS with
\nrespect to each such Benefit Plan as to its qualified status under the Code and
\nno event has occurred which would reasonably be expected to adversely affect the
\nstatus of such determination letter or the qualified status of such Benefit
\nPlan. To the Knowledge of Company no “prohibited transaction,” within the
\nmeaning of Section 4975 of the Code or Sections 406 and 407 of ERISA, and not
\notherwise exempt under Section 408 of ERISA, has occurred with respect to any
\nsuch Benefit Plan. There are no actions, suits or claims pending or, to the
\nKnowledge of the Company or the knowledge of the Principal Stockholder,
\nthreatened (other than routine claims for benefits) against any such Benefit
\nPlan or against the assets of any such Benefit Plan. There are no audits,
\ninquiries or proceedings pending or to the Knowledge of the Company threatened
\nby the IRS, the Department of Labor, or any other Governmental Entity with
\nrespect to any such Benefit Plan. The Company is not subject to any material
\npenalty or tax with respect to any such Benefit Plan under Section 502(i) of
\nERISA or Sections 4975 through 4980 of the Code.<\/p>\n
(c) With respect to those Benefit Plans that are
\nbeing assumed by the Parent as set forth on Schedule 7.4(b), neither the Company
\nnor any Company Subsidiary has ever, with respect to an employee, maintained,
\nestablished, sponsored, participated in, or contributed to, any: (i) Benefit
\nPlans subject to Title IV of ERISA or Section 412 of the Code; (ii) “multiple
\nemployer plan” within the meaning of Section (3)(37) of ERISA; (iii) a “multiple
\nemployer plan” as defined in ERISA or the Code; or (iv) a “funded welfare plan”
\nwithin the meaning of Section 419 of the Code.<\/p>\n
(d) With respect to those Benefit Plans that are
\nbeing assumed by the Parent as set forth on Schedule 7.4(b), no Benefit Plan
\nprovides, or has any liability to provide, retiree life insurance, retiree
\nhealth or other retiree employee welfare benefits to any person for any reason,
\nexcept as may be required by COBRA or other applicable statute, and neither the
\nCompany nor any Company Subsidiary has ever represented, promised or contracted
\n(whether in oral or written form) to any employee (either individually or to
\nemployees as a group) or any other person that such employee(s) or other person
\nwould be provided with retiree life insurance, retiree health or other retiree
\nemployee welfare benefit, except to the extent required by statute.<\/p>\n
(e) To the Knowledge of the Company, with respect to
\nthose Benefit Plans being assumed by Parent as set forth on Schedule 7.4(b),
\neach such Benefit Plan can be terminated or otherwise discontinued after the
\nClosing Date in accordance with its terms and with applicable foreign, state,
\nfederal or local law, without material liability, to Parent, the Company or any
\nCompany Subsidiary.<\/p>\n
(f) To the Knowledge of the Company, neither the
\nCompany nor any Company Subsidiary has, prior to the Closing, engaged in a
\nmaterial violation of any of the health care continuation requirements of COBRA,
\nthe requirements of FMLA, the requirements of the Women’s Health and Cancer
\nRights Act of 1998, the requirements of the Newborns’ and Mothers’ Health
\nProtection Act of 1996, or any amendment to each such act, or any similar
\nprovisions of state law applicable to its current and former employees. As soon
\nas practicable after the date hereof (but in no event longer than ten (10)
\ncalendar days from the date hereof), the<\/p>\n
9<\/p>\n
Company shall deliver to Parent a disclosure schedule setting sets forth all
\ncurrent and former employees of the Company and the Company Subsidiaries that
\nare currently receiving or eligible for health care continuation coverage under
\nCOBRA or any similar provisions of state law.<\/p>\n
(g) With respect to those International Employee
\nPlans being assumed by Parent as set forth on Schedule 7.4(b), to the Knowledge
\nof the Company, each such International Employee Plan has been adopted,
\nmaintained and administered in material compliance with its terms and conditions
\nand with the requirements prescribed by any and all statutory or regulatory laws
\nthat are applicable to such International Employee Plan. Furthermore, no such
\nInternational Employee Plan has unfunded liabilities, that as of the Effective
\nTime, will not be offset by insurance or fully accrued. Except as required by
\nlaw, to the Knowledge of the Company no condition exists that would prevent the
\nCompany or a Company Subsidiary from terminating or amending any such
\nInternational Employee Plan in accordance with its terms and applicable foreign,
\nstate, federal or local law at any time for any reason without material
\nliability to the Company or any Company Subsidiary.<\/p>\n
(h) With respect to those Benefit Plans being assumed
\nby Parent as set forth on Schedule 7.4(b), the execution of this Agreement and
\nthe consummation of the Transactions will not (either alone or upon the
\noccurrence of any additional or subsequent events) constitute an event under any
\nCompany Benefit Plan, employee agreement, trust or loan that will or may result
\nin any payment (whether of severance pay or otherwise), acceleration,
\nforgiveness of indebtedness, vesting, distribution, increase in benefits or
\nobligation to fund benefits with respect to any current (or former) employee,
\ndirector or consultant.<\/p>\n
Section 3.17 Tax Matters. (a) All material Tax Returns
\nrequired to be filed by or with respect to the Company or any Company Subsidiary
\nhave been filed on a timely basis (taking into account all applicable
\nextensions); (b) other than amounts for any unpaid Taxes of the Company or any
\nCompany Subsidiary that have been adequately accrued or reserved (in accordance
\nwith GAAP) on the Balance Sheet, all material Taxes required to be paid or
\nwithheld by the Company or a Company Subsidiary (whether or not shown in any Tax
\nReturn) have been timely paid in full and\/or timely withheld and either have
\nbeen duly and timely paid over to the appropriate Tax Authority or been properly
\nset aside for such purpose and will be duly and timely paid to the appropriate
\nTax Authority; (c) all such filed Tax Returns were true, correct and complete in
\nall material respects; (d) there are no liens for Taxes upon any property or
\nassets of the Company or any Company Subsidiary, except for Permitted
\nEncumbrances; (e) no federal, state, local or foreign Audits are presently
\npending with regard to any Taxes or Tax Returns of the Company or any Company
\nSubsidiary; (f) neither the Company nor any Company Subsidiary has executed any
\nwaiver of the statute of limitations on or extending the period for the
\nassessment of collection of any Tax; and (g) neither the Company nor any Company
\nSubsidiary has any liability for unpaid Taxes that has not been adequately
\naccrued or reserved (in accordance with GAAP) on the most recent Financial
\nStatements, and since the date of the most recent Financial Statements, neither
\nthe Company nor any Company Subsidiary has incurred any liability for Taxes
\nother than in the ordinary course of business.<\/p>\n
10<\/p>\n
Section 3.18 Intellectual Property.<\/p>\n
(a) Section 3.18(a) of the Company Disclosure
\nSchedule lists all Company Registered Intellectual Property. The Company or one
\nof the Company Subsidiaries is listed in the records of the appropriate United
\nStates federal or state agency as the sole owner for each item of the Company
\nRegistered Intellectual Property that is the subject of a registration in the
\nUnited States. To the Knowledge of the Company, either the Company or one of the
\nCompany Subsidiaries is listed in the records of the appropriate foreign agency
\nas the sole owner for each item of Company Registered Intellectual Property that
\nis the subject of a registration outside the United States. To the Knowledge of
\nthe Company, the Intellectual Property included in the Acquired Assets,
\nincluding the Company Registered Intellectual Property, includes all
\nIntellectual Property rights in and to all material inventions, works of
\nauthorship, and know-how created, invented or authored, as the case may be, by
\nany employee of, or consultant to, the Company or any Company Subsidiary in the
\ncourse of such employment or consulting relationship. The preceding sentence is
\nqualified by the Knowledge of the Company for facts and circumstances prior to
\nJanuary 2000. The Company and each Company Subsidiary implements and enforces a
\npolicy requiring all employees, contractors and other parties who create
\nIntellectual Property for, or on behalf of, the Company or a Company Subsidiary
\nto execute an assignment agreement in substantially the form provided to Parent,
\ntransferring ownership of such Intellectual Property to the Company or the
\nCompany Subsidiary, as the case may be.<\/p>\n
(b) Section 3.18(b) of the Company Disclosure
\nSchedule (i) lists all Computer Software owned or licensed by, or otherwise used
\nin the business of, the Company or any Company Subsidiary, other than (x) third
\nparty software applications that are generally available and have an individual
\nacquisition cost of $50,000 or less, or (y) software applications that are used
\nin general infrastructure and administrative functions that are generally
\navailable and have an individual acquisition cost of $50,000 or less, and (ii)
\nidentifies whether each of the foregoing items of Computer Software are owned,
\nlicensed, or otherwise used, as the case may be.<\/p>\n
(c) Section 3.18(c) of the Company Disclosure
\nSchedule lists all material Licenses, specifying the name of the parties thereto
\nand whether the License is an inbound license, an outbound license or a
\ncross-license. To the Knowledge of the Company, each such License is in full
\nforce and effect and is enforceable in accordance with its terms. The Company
\nand the Company Subsidiaries are in material compliance with, and have not
\nmaterially breached any term of any of such Licenses and, to the Knowledge of
\nthe Company, all other parties to such Licenses are in compliance with, and have
\nnot breached any term of, such Licenses.<\/p>\n
(d) Section 3.18(d) of the Company Disclosure
\nSchedule contains a complete and accurate list (by name and version number) of
\nall material service offerings, Computer Software and other products or services
\nof the Company or any Company Subsidiary currently sold, licensed, distributed
\nor otherwise provided by the Company or any Company Subsidiary (all of the
\nforegoing, collectively, “Company Products”).<\/p>\n
(e) To the Knowledge of the Company, neither the
\nCompany nor any Company Subsidiary has done, or failed to do, any act or thing
\nwhich may, after the Closing<\/p>\n
11<\/p>\n
Date, prejudice the validity or enforceability of any material Company
\nRegistered Intellectual Property in any material respect.<\/p>\n
(f) Either the Company or a Company Subsidiary is the
\nsole and exclusive owner of all material Company Intellectual Property except as
\nto Intellectual Property that is co-owned by the Company and any Company
\nSubsidiary; provided, however, that as to any Intellectual Property that is
\nco-owned by the Company and one or more Company Subsidiaries, the Acquired
\nAssets will include the ownership rights of the Company and all co-owner Company
\nSubsidiaries.<\/p>\n
(g) To the Knowledge of the Company, either the
\nCompany or a Company Subsidiary owns or otherwise has the right to use all
\nIntellectual Property necessary to: (i) provide the services currently provided
\nby the Company to third parties; (ii) use, manufacture, copy, modify, market and
\ndistribute the products currently manufactured, marketed, sold, licensed or
\notherwise distributed by the Company; and (iii) operate the internal systems of
\nthe Company that are material to its business or operations, taken as a whole,
\nincluding, without limitation, computer hardware systems and software
\napplications. To the Knowledge of the Company, there are no facts or
\ncircumstances that would reasonably lead it to believe that the Company and the
\nCompany Subsidiaries do not own or otherwise have the right to use all
\nIntellectual Property necessary to: (i) provide the services currently provided
\nby the Company to third parties; (ii) use, manufacture, copy, modify, market and
\ndistribute the products currently manufactured, marketed, sold, licensed or
\notherwise distributed by the Company; and (iii) operate the internal systems of
\nthe Company that are material to its business or operations, taken as a whole,
\nincluding, without limitation, computer hardware systems and software
\napplications. Each material item of such Intellectual Property shall be owned,
\navailable for use or enforceable, as the case may be, by Parent immediately
\nfollowing the Closing on substantially identical terms and conditions as it was
\navailable to or enforceable by, as the case may be, the Company immediately
\nprior to the Closing.<\/p>\n
(h) To the Knowledge of the Company, the activities
\nand the conduct of the business and operations of the Company and any Company
\nSubsidiary did not prior to Closing, and will not when conducted in the same
\nmanner following the Closing, infringe upon, violate or constitute the
\nunauthorized use of the Intellectual Property rights of any third party. To the
\nKnowledge of the Company, there are no facts or circumstances that would
\nreasonably lead it to believe that the activities or the conduct of the business
\nor operations of the Company or any Company Subsidiary did prior to Closing, or
\nwill when conducted in the same manner following the Closing, infringe upon,
\nviolate or constitute the unauthorized use of the Intellectual Property rights
\nof any third party. There is no pending or, to the Knowledge of the Company,
\nthreatened (in writing) claim before any court, agency, arbitral tribunal, or
\nregistration authority in any jurisdiction: (i) involving any item of
\nIntellectual Property owned or used by the Company; (ii) alleging that the
\nactivities or the conduct of the business of the Company and the Company
\nSubsidiaries does or will infringe upon, violate or constitute the unauthorized
\nuse of the Intellectual Property rights of any third party; or (iii) challenging
\nthe ownership, use, validity, enforceability or registrability of any
\nIntellectual Property by the Company. There are no settlements, forbearances to
\nsue, consents, judgments, or orders or similar obligations (other than license
\nagreements in the ordinary course of business) which (A) restrict the rights of
\nthe<\/p>\n
12<\/p>\n
Company to use any material Intellectual Property; (B) restrict the Company’s
\nbusiness in order to accommodate a third party’s intellectual property rights;
\nor (C) permit third parties to use any material Intellectual Property owned by
\nthe Company.<\/p>\n
(i) [reserved]<\/p>\n
(j) No third party possesses any copy of any source
\ncode to any material Computer Software of the Company, except as permitted under
\na License set forth in Section 3.18(c) of the Company Disclosure Schedule.<\/p>\n
(k) No Computer Software that is open source, public
\nsource or freeware, or any modification or derivative thereof, including any
\nversion of any Computer Software licensed pursuant to any GNU general public
\nlicense or limited general public license was or is used in, incorporated into,
\nintegrated or bundled with any material Company Product.<\/p>\n
(l) To the Knowledge of the Company, the Company and
\nthe Company Subsidiaries have taken commercially reasonable actions to protect
\neach item of material Intellectual Property owned by them, except where the
\nfailure to take such actions was the result of a reasonable business decision by
\nthe Company made in the ordinary course of business. To the Knowledge of the
\nCompany, without limiting the foregoing, the Company and the Company
\nSubsidiaries have taken commercially reasonable actions to protect their
\nrespective material Trade Secrets and any material Trade Secrets of third
\nparties provided to the Company or any Company Subsidiary. The Company and each
\nCompany Subsidiary implements and enforces a policy requiring all employees,
\ncontractors and other parties having access to such Trade Secrets to execute a
\nproprietary information\/confidentiality agreement, in substantially the form
\nprovided to Parent, with the Company or one of the Company Subsidiaries, as the
\ncase may be. To the Knowledge of the Company, there has been no disclosure by
\nthe Company or by the Company Subsidiaries of any such Trade Secrets except
\npursuant to such proprietary information\/confidentiality agreements, and, to the
\nKnowledge of the Company, no party to any such agreement is in breach thereof.<\/p>\n
(m) Neither the Company nor any Company Subsidiary is
\nin violation of any agreement relating to any Company Intellectual Property or
\nany third party Intellectual Property, except for such violations as have not
\nresulted, and could not reasonably be expected to result, individually or in the
\naggregate, in a Company Material Adverse Effect. To the Knowledge of the
\nCompany, the consummation of the Transactions will not result in Parent being
\nbound by any non-compete or other restriction on the operation of any business
\nof Parent prior to the Closing or the granting by Parent of any rights or
\nlicenses to any Intellectual Property rights of Parent prior to the Closing to a
\nthird party (including but not limited to a covenant not to sue)<\/p>\n
(n) To the Knowledge of the Company, neither the
\nCompany nor any Company Subsidiary has disclosed the source code for any of the
\nComputer Software owned by them or other confidential information constituting,
\nembodied in or pertaining to such Computer Software to any Person, except
\npursuant to effective nondisclosure agreements, and the Company has taken
\ncommercially reasonable measures to prevent disclosure of such source code.<\/p>\n
13<\/p>\n
(o) To the Knowledge of the Company: (i) the Company
\nand the Company Subsidiaries have at all times complied with all applicable Laws
\nrelating to privacy, data protection and the collection and use of personal
\ninformation and user information gathered or accessed in the course of the
\noperations of the Company or any Company Subsidiary; (ii) the Company and the
\nCompany Subsidiaries have at all times complied in all respects with all rules,
\npolicies and procedures established by the Company or any Company Subsidiary
\nfrom time to time with respect to privacy, publicity, data protection or
\ncollection and use of personal information and user information gathered or
\naccessed in the course of the operations of the Company or any Company
\nSubsidiary; and (iii) no claims have been asserted or threatened against the
\nCompany or any Company Subsidiary (and to the Knowledge of the Company, no such
\nclaims are likely to be asserted or threatened against the Company or any
\nCompany Subsidiary) by any Person alleging a violation of such Person’s privacy,
\npersonal or confidentiality rights under any such rules, policies or procedures.
\nWith respect to all personal and user information described in this Section
\n3.18(o), the Company and the Company Subsidiaries have at all times taken all
\nsteps reasonably necessary (including, without limitation, implementing and
\nmonitoring compliance with adequate measures with respect to technical and
\nphysical security) to ensure that the information is protected against loss and
\nagainst unauthorized access, use, modification, disclosure or other misuse. To
\nthe Knowledge of the Company, there has been no unauthorized access to or other
\nmisuse of that information. To the Knowledge of the Company, the consummation of
\nthe Transactions will not result in any breach or violation of any of the
\nCompany’s or any of its subsidiaries procedures, policies or rules governing
\nprivacy or use of any information or data of, or with respect to, any Person or
\nviolate any Law with respect to such data or information.<\/p>\n
Section 3.19 Labor Matters.<\/p>\n
(a) No work stoppage or labor strike against the
\nCompany or any Company Subsidiary is pending, or to the Knowledge of the
\nCompany, threatened nor has there been any such action since August 31, 1999. To
\nthe Knowledge of the Company, there are no activities or proceedings of any
\nlabor union, works council or other employee collective bargaining group or
\nassociation to organize any employees, and, to the Knowledge of the Company, no
\nunion or works council claims to represent any employees. There are no actions,
\nsuits, claims, labor disputes or grievances pending, or to the Knowledge of the
\nCompany, threatened, relating to any labor, safety or discrimination matters
\ninvolving any employee, including without limitation, charges of unfair labor
\npractices or discrimination complaints. To the Knowledge of the Company, neither
\nthe Company nor any Company Subsidiary has engaged in any unfair labor practices
\nwithin the meaning of the National Labor Relations Act. Neither the Company nor
\nany Company Subsidiary presently has been in the past, a party to, or bound by,
\nany collective bargaining agreement or union contract with respect to employees
\nand no collective bargaining agreement is being negotiated on behalf of the
\nemployees.<\/p>\n
(b) The Company and each Company Subsidiary: (i) is
\nin compliance in all material respects with all applicable federal, state and
\nlocal laws, rules and regulations respecting employment, employment practices,
\nterms and conditions of employment, health and safety and wages and hours
\n(including but not limited to the classification and\/or treatment of employees
\nas exempt or non-exempt), in each case, with respect to employees; (ii) has
\nwithheld<\/p>\n
14<\/p>\n
all amounts required by law or by agreement to be withheld from the wages,
\nsalaries and other payments to employees; and (iii) is not liable in any
\nmaterial respect for any arrears of wages or any Taxes or any penalty for
\nfailure to comply with any of the foregoing. There are no pending, or, to the
\nKnowledge of the Company, threatened or reasonably anticipated claims, charges
\nor actions pending against the Company before the Equal Employment Opportunity
\nCommission or similar state, federal or local agency or under any worker’s
\ncompensation policy or long-term disability policy.<\/p>\n
(c) Since January 1, 2001, (i) neither the Company
\nnor any Company Subsidiary has effected a “plant closing” (as defined in the
\nWARN Act) affecting any site of employment or one or more facilities or
\noperating units within any site of employment or facility; (ii) there has not
\noccurred a “mass layoff” (as defined in the WARN Act) affecting any site of
\nemployment or facility of the Company or any Company Subsidiary; (iii) neither
\nthe Company nor any Company Subsidiary has engaged in layoffs or employment
\nterminations sufficient in number to trigger application of any state, local or
\nforeign law or regulation similar to the WARN Act; and (iv) none of the Company
\nnor any of the Company Subsidiaries’ employees has suffered an “employment loss”
\n(as defined in the WARN Act) during the ninety (90) day period prior to the date
\nof this Agreement.<\/p>\n
Section 3.20 Affiliate Transactions. No Contracts are in
\neffect as of the date hereof between the Company or any Company Subsidiary on
\nthe one hand, and Affiliates of the Company, on the other hand.<\/p>\n
Section 3.21 Brokers or Finders. The Company has not entered
\ninto any Contract entitling any agent, broker, investment banker, financial
\nadvisor or other firm or Person to any broker’s or finder’s fee or any other
\ncommission or similar fee in connection with any of the Transactions, other than
\nUS Bancorp Piper Jaffray, a true and correct copy of which has been provided to
\nParent.<\/p>\n
Section 3.22 Bank Accounts. Section 3.22 of the Company
\nDisclosure Schedule sets forth the names and locations of all banks, trust
\ncompanies, savings and loan associations and other financial institutions at
\nwhich the Company or any Company Subsidiary maintains safe deposit boxes,
\nchecking accounts or other accounts of any nature the available balance of which
\ncustomarily exceeds $5,000.<\/p>\n
Section 3.23 Accounts Receivable and Payable. All accounts
\nreceivable and accounts payable of the Company or any Company Subsidiary have
\narisen, and as of the Closing Date shall have arisen, from bona fide
\ntransactions in the ordinary course of business consistent with past practice.<\/p>\n
Section 3.24 Ownership of Assets. As between (i) Principal
\nStockholder and its Subsidiaries (other than the Company and the Company
\nSubsidiaries), on the one hand, and (ii) the Company and the Company
\nSubsidiaries, on the other hand, none of the Principal Stockholder nor its
\nSubsidiaries (other than the Company and the Company Subsidiaries) own, or have
\nthe right (under Contracts to which the Company or any Company Subsidiary is a
\nparty) to use or otherwise have a license to any of the assets and other rights
\n(whether tangible or<\/p>\n
15<\/p>\n
intangible) used to conduct the business, operations and activities of the
\nCompany as presently conducted.<\/p>\n
Section 3.25 Investment Intent.<\/p>\n
(a) Investment Representations. The Company
\nunderstands that the shares of Parent Common Stock it will receive pursuant to
\nthe terms of this Agreement have not been registered under the Securities Act.
\nThe Company also understands that these shares are being offered and sold
\npursuant to an exemption from registration under the Securities Act based in
\npart upon the Company’s representations contained in the Agreement. The Company
\nhereby represents and warrants as follows:<\/p>\n
(i) Acquisition for Own Account. The Company
\n is acquiring the shares of Parent Common Stock for the Company’s own
\n account for investment only, and not with a view towards their
\n distribution other than pursuant to an effective registration statement
\n or a valid exemption from registration under the Securities Act.<\/p>\n
(ii) The Company Can Protect Its Interest.
\n The Company represents that by reason of its, or of its management’s,
\n business or financial experience, the Company has the capacity to
\n protect its own interests in connection with the Transactions.<\/p>\n
(iii) Parent Information. The Company has
\n had an opportunity to discuss Parent’s business, management and
\n financial affairs with directors, officers and management of Parent and
\n has had the opportunity to review Parent’s operations and facilities.
\n The Company has also had the opportunity to ask questions of and
\n receive answers from, Parent and its management regarding the terms and
\n conditions of this investment.<\/p>\n
(iv) Legends. To the extent applicable, each
\n certificate or other document evidencing any of the shares of Parent
\n Common Stock delivered pursuant to the terms of this Agreement shall be
\n endorsed with the legends substantially in the form set forth below:<\/p>\n
“THE SHARES REPRESENTED HEREBY HAVE NOT BEEN REGISTERED UNDER THE
\n SECURITIES ACT OF 1933, AS AMENDED, AND MAY NOT BE SOLD,
\n TRANSFERRED, ASSIGNED, PLEDGED, OR HYPOTHECATED UNLESS AND UNTIL
\n REGISTERED UNDER SUCH ACT, OR UNLESS THE COMPANY HAS RECEIVED AN
\n OPINION OF COUNSEL OR OTHER EVIDENCE, SATISFACTORY TO THE COMPANY
\n AND ITS COUNSEL, THAT SUCH REGISTRATION IS NOT REQUIRED.”<\/p>\n
16<\/p>\n
(b) Rule 145 Compliance. The Company further
\nrepresents, warrants and covenants that, for purposes of, and within the meaning
\nof, Rule 145 under the Securities Act:<\/p>\n
(i) the Company has not submitted this
\n Agreement or the Transactions for the vote or consent of any of its
\n stockholders other than the Principal Stockholder;<\/p>\n
(ii) the Company has not adopted a plan or
\n agreement that provides for dissolution of the Company;<\/p>\n
(iii) the Company has not adopted a plan or
\n agreement that provides for a pro rata or similar distribution of
\n the shares of Parent Common Stock to be delivered pursuant to the
\n Transactions to the security holders of the Company;<\/p>\n
(iv) the Company’s Board of Directors has
\n not adopted resolutions relative to (ii) or (iii) above within one
\n (1) year after the date hereof; and<\/p>\n
(v) the transfer of the Acquired Assets
\n hereby is not part of a pre-existing plan for the distribution of
\n the shares of Parent Common Stock to be delivered pursuant to the
\n Transactions.<\/p>\n
ARTICLE IV<\/p>\n
REPRESENTATIONS AND WARRANTIES OF PRINCIPAL STOCKHOLDER<\/p>\n
Principal Stockholder represents and warrants to Parent that all of
\nthe statements contained in this Article IV are true and correct. The inclusion
\nof any information in any document delivered by Principal Stockholder pursuant
\nto this Agreement shall not be deemed to be an admission or evidence of the
\nmateriality of such item, nor shall it establish a standard of materiality for
\nany purpose whatsoever.<\/p>\n
Section 4.1 Organization; Qualification of Principal
\nStockholder. Principal Stockholder is a corporation duly organized, validly
\nexisting and in good standing under the laws of Delaware.<\/p>\n
Section 4.2 Authorization. Principal Stockholder has all
\nrequisite corporate power and authority to execute and deliver this Agreement
\nand to consummate the Transactions. The execution, delivery and performance by
\nPrincipal Stockholder of this Agreement and the consummation of the Transactions
\nby Principal Stockholder have been duly authorized by the Board of Directors of
\nPrincipal Stockholder, and no other corporate action on the part of Principal
\nStockholder (including its stockholders) is necessary to authorize the execution
\nand delivery of this Agreement by Principal Stockholder or the consummation by
\nPrincipal Stockholder of any of the Transactions.<\/p>\n
Section 4.3 Execution; Validity of Agreement. This Agreement
\nhas been duly<\/p>\n
17<\/p>\n
executed and delivered by Principal Stockholder, and, assuming due and valid
\nauthorization, execution and delivery hereof by the Company and Parent is a
\nvalid and binding obligation of Principal Stockholder, enforceable against
\nPrincipal Stockholder in accordance with its terms, except (a) as limited by
\napplicable bankruptcy, insolvency, reorganization, moratorium, fraudulent
\nconveyance and other similar Laws of general application affecting enforcement
\nof creditors’ rights generally and (b) the availability of the remedy of
\nspecific performance or injunctive or other forms of equitable relief may be
\nsubject to equitable defenses and would be subject to the discretion of the
\ncourt before which any proceeding therefor may be brought.<\/p>\n
Section 4.4 Consents and Approvals; No Violations. Except for
\n(a) the filings, permits, authorizations, consents and approvals as may be
\nrequired under, and other applicable requirements of, the Securities Act, the
\nExchange Act, the HSR Act, applicable foreign antitrust Laws, and state
\nsecurities laws and (b) in the case (y) below, except as would not have a
\nmaterial adverse effect on the ability of Principal Stockholder to consummate
\nthe Transactions, none of the execution, delivery or performance of this
\nAgreement by Principal Stockholder, the consummation by Principal Stockholder of
\nthe Transactions or compliance by Principal Stockholder with any of the
\nprovisions hereof shall: (w) conflict with or result in any breach of any
\nprovision of Principal Stockholder’s Certificate of Incorporation or Bylaws as
\npresently in effect; (x) require any filing with, or permit, authorization,
\nconsent or approval of, any Governmental Entity; (y) result in a violation or
\nbreach of, or constitute (with or without due notice or lapse of time or both) a
\ndefault (or give rise to any right of termination, cancellation or acceleration)
\nunder, any of the terms, conditions or provisions of any Company Material
\nContract; or (z) violate any order, writ, injunction, decree, statute, rule or
\nregulation applicable to Principal Stockholder.<\/p>\n
Section 4.5 Litigation. As of the date of this Agreement,
\nthere is no action, suit, inquiry, proceeding or investigation by or before any
\ncourt or Governmental Entity pending or, to the knowledge of Principal
\nStockholder, threatened against or involving Principal Stockholder that: (i) is
\nexpected to have a material adverse effect on the ability of Principal
\nStockholder to consummate the Transactions; (ii) questions or challenges the
\nvalidity of this Agreement or any action taken or to be taken by Principal
\nStockholder pursuant to this Agreement or in connection with the Transactions;
\nor (iii) is reasonably likely to result in liability to Parent following the
\nClosing, other than as disclosed in the Company Disclosure Schedule.<\/p>\n
Section 4.6 Brokers or Finders. Neither Principal Stockholder
\nnor any of its Subsidiaries or Affiliates has entered into any Contract
\nentitling any agent, broker, investment banker, financial advisor or other firm
\nor Person to any brokers’ or finders’ fee or any other commission or similar fee
\nin connection with the Transactions, other than US Bancorp Piper Jaffray, whose
\nfees and expenses shall be paid by the Company in accordance with the Company’s
\nagreement with such firm, a true and correct copy of which has been provided to
\nParent.<\/p>\n
Section 4.7 Disclaimer of Other Representations and
\nWarranties. Except as expressly set forth in this Article IV, Principal
\nStockholder makes no representation or warranty, express or implied, at law or
\nin equity, and any such other representations and warranties are hereby
\ndisclaimed. Without limiting the generality of the foregoing, Principal
\nStockholder<\/p>\n
18<\/p>\n
makes no representation or warranty regarding the Acquired Assets or the Assumed
\nLiabilities, and none shall be implied at law or in equity.<\/p>\n
ARTICLE V<\/p>\n
REPRESENTATIONS AND WARRANTIES OF PARENT<\/p>\n
Except as set forth in the Parent Disclosure Schedule,
\nprepared and signed by Parent and delivered to the Company and Principal
\nStockholder simultaneously with the execution hereof, Parent represents and
\nwarrants to the Company, Aurora and Principal Stockholder that all of the
\nstatements contained in this Article V are true and correct. For purposes of the
\nrepresentations and warranties of Parent contained herein, disclosure in any
\nsection of the Parent Disclosure Schedule of any facts or circumstances shall be
\ndeemed to be disclosure of such facts or circumstances with respect to such
\nother representations or warranties by Parent calling for disclosure of such
\ninformation, if such disclosure would reasonably lead the Company and Principal
\nStockholder to make further inquiry of such facts and circumstances, and such
\nfurther inquiry would reasonably reveal that such disclosure applies to such
\nother representations and warranties. The inclusion of any information in any
\nsection of the Parent Disclosure Schedule or other document delivered by Parent
\npursuant to this Agreement shall not be deemed to be an admission or evidence of
\nthe materiality of such item, nor shall it establish a standard of materiality
\nfor any purpose whatsoever.<\/p>\n
Section 5.1 Organization; Qualification of Parent. Parent is
\na corporation duly organized, validly existing and in good standing under the
\nlaws of the State of Delaware and has all requisite corporate power and
\nauthority and all necessary governmental approvals to own, lease and operate
\ntheir properties and to carry on their business as it is now being conducted,
\nexcept where the failure to be so organized, existing and in good standing or to
\nhave such power, authority and government approvals would not have, individually
\nor in the aggregate, a Parent Material Adverse Effect.<\/p>\n
Section 5.2 Authorization. Parent has all requisite corporate
\npower and authority to execute and deliver this Agreement and to consummate the
\nTransactions. The execution, delivery and performance by Parent of this
\nAgreement and the consummation of the Transactions by Parent have been duly
\nauthorized by Parent’s Board of Directors and no other corporate action on the
\npart of the Parent (including Parent’s stockholders) is necessary to authorize
\nthe execution and delivery of this Agreement by Parent or the consummation by
\nParent of any of the Transactions.<\/p>\n
Section 5.3 Execution; Validity of Agreement. This Agreement
\nhas been duly executed and delivered by Parent and, assuming due and valid
\nauthorization, execution and delivery hereof by the Company, is a valid and
\nbinding obligation of Parent, enforceable against each of them in accordance
\nwith its terms except (a) as limited by applicable bankruptcy, insolvency,
\nreorganization, moratorium, fraudulent conveyance and other similar Laws of
\ngeneral application affecting enforcement of creditors’ rights generally and (b)
\nthe availability of the remedy of specific performance or injunctive or other
\nforms of equitable relief may be subject to equitable defenses and would be
\nsubject to the discretion of the court before which any proceeding therefor may
\nbe brought.<\/p>\n
19<\/p>\n
Section 5.4 Consents and Approvals; No Violations. Except for
\n(a) the filings, permits, authorizations, consents and approvals as may be
\nrequired under, and other applicable requirements of, the Securities Act, the
\nExchange Act, the HSR Act, and applicable foreign antitrust Laws and state
\nsecurities laws and (b) in the case of (y) below, except as would not have a
\nParent Material Adverse Effect, none of the execution, delivery or performance
\nof this Agreement by Parent, the consummation by Parent of the Transactions or
\ncompliance by Parent with any of the provisions hereof shall: (w) conflict with
\nor result in any breach of any provision of the Certificate of Incorporation or
\nBylaws of Parent, each as presently, in effect; (x) require any filing with, or
\npermit, authorization, consent or approval of, any Governmental Entity; (y)
\nresult in a violation or breach of, or constitute (with or without due notice or
\nlapse of time or both) a default (or give rise to any right of termination,
\ncancellation or acceleration) under, any of the terms, conditions or provisions
\nof any material Contract of Parent; or (z) violate any order, writ, injunction,
\ndecree, statute, rule or regulation applicable to Parent.<\/p>\n
Section 5.5 Capitalization. As of January 28, 2003, the
\nauthorized capital stock of Parent consists of (a) 200,000,000 shares of Parent
\nCommon Stock, of which 59,275,635 shares are issued and outstanding; and (b)
\n10,000,000 shares of preferred stock, all of which have been designated Series A
\nPreferred Stock, none of which are issued and outstanding. No shares are held in
\ntreasury. As of the date hereof, approximately 8,900,000 shares of Parent Common
\nStock are reserved for issuance upon the exercise of options outstanding under
\nParent’s various stock incentive plans. As of the date hereof, no shares of
\nParent Common Stock are reserved for issuance upon the exercise of warrants. All
\nthe outstanding shares of Parent Common Stock and Parent preferred stock are
\nduly authorized, validly issued, fully paid and non-assessable. Except as set
\nforth above, as of the date hereof, (x) there are no shares of capital stock of
\nParent authorized, issued or outstanding, other than shares of Parent Common
\nStock issued subsequent to January 28, 2003 pursuant to previously outstanding
\noptions issued pursuant to the Parent’s stock option plans and (y) there are no
\nexisting options, warrants, calls, pre-emptive rights, subscriptions or other
\nrights, agreements, arrangements or commitments of any character, relating to
\nthe issued or unissued capital stock of Parent or any of its Subsidiaries
\nobligating Parent to issue, transfer or sell or cause to be issued, transferred
\nor sold any shares of capital stock of Parent, other than options to purchase
\nParent Common Stock granted in the ordinary course of business subsequent to
\nJanuary 28, 2003 pursuant to Parent’s stock option plans in existence as of that
\ndate.<\/p>\n
Section 5.6 Parent SEC Reports. Parent has filed all required
\nforms, reports, schedules, statements and other documents (including exhibits
\nand other information incorporated therein) with the SEC since December 31, 2000
\nthrough the date hereof (collectively, the “Parent SEC Reports”). As of their
\nrespective dates, or, if amended, as of the date of the last such amendment,
\neach Parent SEC Report, (a) complied in all material respects with the
\napplicable requirements of the Securities Act, the Exchange Act, and the rules
\nand regulations thereunder applicable to such Parent SEC Reports and (b) did not
\ncontain any untrue statement of a material fact or omit to state a material fact
\nrequired to be stated therein or necessary to make the statements made therein,
\nin the light of the circumstances under which they were made, not misleading.
\nEach of the consolidated balance sheets included in or incorporated by reference
\ninto the Parent SEC Reports (including the related notes and schedules) fairly
\npresents in all material respects the consolidated financial position of Parent<\/p>\n
20<\/p>\n
and its Subsidiaries as of its date, and each of the consolidated statements of
\noperations, stockholders’ equity and cash flows included in or incorporated by
\nreference into the Parent SEC Reports (including any related notes and
\nschedules) fairly presents in all material respects the financial position,
\nresults of operations and cash flows, as the case may be, of Parent and its
\nSubsidiaries for the periods set forth therein (subject, in the case of
\nunaudited statements, to normal year-end audit adjustments and the absence of
\nfootnotes), in each case in accordance with GAAP consistently applied during the
\nperiods involved, except as may be noted therein. There is no investigation by
\nthe SEC threatened or pending, or, to the knowledge of the Parent, contemplated
\nwith respect to any Parent SEC Report, including, without limitation, revenue
\nrecognition thereunder or any of Parent’s officers, directors or principal
\nstockholders.<\/p>\n
Section 5.7 No Undisclosed Liabilities. Except for (a)
\nliabilities and obligations disclosed in Parent’s quarterly report on Form 10-Q
\nfor the quarter ended September 30, 2002 filed with the SEC, incurred in the
\nordinary course of business since September 30, 2002, (b) liabilities arising
\nout of facts or events fully disclosed in a press release issued by Parent
\nsubsequent to that date and prior to the date hereof, and (c) liabilities that
\nwould not reasonably be expected to result in a Parent Material Adverse Effect,
\nneither Parent nor any of its Subsidiaries, taken as a whole, has any
\nliabilities or obligations, that would be required to be disclosed in a
\nconsolidated balance sheet of Parent (including the related notes thereto, where
\nappropriate) prepared in accordance with GAAP.<\/p>\n
Section 5.8 Absence of Certain Changes. Except as (a)
\ndisclosed in the Parent SEC Reports, (b) disclosed in Parent’s quarterly report
\non Form 10-Q for the quarter ended September 30, 2002 filed with the SEC, (c)
\nfully disclosed in a press release issued by Parent subsequent to that date and
\nprior to the date hereof, or (d) expressly required by this Agreement, since
\nSeptember 30, 2002 to the Parent’s knowledge, no event that would be reasonably
\nlikely to result in a Parent Material Adverse Effect has occurred.<\/p>\n
Section 5.9 Parent Material Contracts. To Parent’s knowledge,
\nParent has not breached, or received in writing any claim or notice that it has
\nbreached, any of the terms or conditions of (i) any agreement, contract or
\ncommitment required to be filed as an exhibit to the Parent SEC Reports
\n(including any agreements, contracts or commitments entered into since September
\n30, 2002 that are required to be filed by Parent with the SEC in any report in
\nthe future), or (ii) any agreement with any of the parties listed on Section 5.9
\nof the Parent Disclosure Schedule (the “Parent Material Contracts”). Each Parent
\nMaterial Contract that has not expired by its terms is in full force and effect
\nand is the legal, valid and binding obligation of Parent, enforceable against
\nthem in accordance with its terms, subject to applicable bankruptcy, insolvency,
\nreorganization, moratorium and similar laws affecting creditors’ rights and
\nremedies generally and subject, as to enforceability, to general principles of
\nequity (regardless of whether enforcement is sought in a proceeding at law or in
\nequity), except where the failure of such Parent Material Contract to be in full
\nforce and effect or to be legal, valid, binding or enforceable against Parent
\nhas not had and would not, individually or in the aggregate, reasonably be
\nexpected to have a Parent Material Adverse Effect.<\/p>\n
Section 5.10 Availability of Funds. Parent currently has
\naccess to sufficient immediately available funds in cash or cash equivalents,
\nand shall at the Closing have sufficient<\/p>\n
21<\/p>\n
immediately available funds, in cash, to pay all amounts payable pursuant to
\nthis Agreement and to consummate the Transactions including, but not limited to,
\nthe Cash Consideration.<\/p>\n
Section 5.11 Litigation. As of the date of this Agreement,
\nthere is no action, suit, inquiry, proceeding or investigation by or before any
\ncourt or Governmental Entity pending or, to the knowledge of Parent, overtly
\nthreatened against or involving Parent or any of its Subsidiaries that is
\nexpected to have a Parent Material Adverse Effect or that questions or
\nchallenges the validity of this Agreement or any action taken or to be taken by
\nParent or any of its Subsidiaries pursuant to this Agreement or in connection
\nwith the Transactions.<\/p>\n
Section 5.12 Investigation by Parent. Parent has conducted
\nits own independent investigation, review and analysis of the business,
\noperations, assets, liabilities, results of operations, financial condition,
\nsoftware, technology and prospects of the Company and the Company Subsidiaries,
\nwhich investigation, review and analysis was done by Parent and, to the extent
\nParent deemed appropriate, by Parent’s representatives. Parent acknowledges that
\nit and its representatives have been provided adequate access to the personnel,
\nproperties, premises and records of the Company and the Company Subsidiaries for
\nsuch purpose. In entering into this Agreement, Parent acknowledges that it has
\nrelied solely upon the aforementioned investigation, review and analysis and,
\nexcept and only to the extent expressly set forth in Articles III and IV, not on
\nany factual representations or opinions of the Company or the Company’s
\nrepresentatives, and, in each case, Parent:<\/p>\n
(a) acknowledges that, except and only to the extent
\nexpressly set forth in Articles III and IV, none of the Company, the Company
\nSubsidiaries, Principal Stockholder or any of their respective directors,
\nofficers, stockholders, employees, Affiliates, controlling persons, agents,
\nadvisors or representatives makes or has made any oral or written representation
\nor warranty, either express or implied, as to the accuracy or completeness of
\nany of the information (including in materials furnished in the Company’s data
\nroom, in presentations by the Company’s management or otherwise) provided or
\nmade available to the Parent or its directors, officers, employees, Affiliates,
\ncontrolling persons, agents or representatives;<\/p>\n
(b) agrees, to the fullest extent permitted by Law,
\nthat none of the Company, the Company Subsidiaries, Principal Stockholder or any
\nof their respective directors, officers, employees, shareholders, Affiliates,
\ncontrolling persons, agents, advisors or representatives shall have any
\nliability or responsibility whatsoever to Parent or its directors, officers,
\nemployees, Affiliates, controlling persons, agents or representatives on any
\nbasis (including in contract or tort, under federal or state securities laws or
\notherwise) based upon any information provided or made available, or statements
\nmade (including in materials furnished in the Company’s data room, in
\npresentations by the Company’s management or otherwise), to Parent or its
\ndirectors, officers, employees, Affiliates, controlling persons, advisors,
\nagents or representatives (or any omissions therefrom); and<\/p>\n
(c) Parent hereby acknowledges that, except to the
\nextent specifically set forth in this Article V, Parent is purchasing the
\nAcquired Assets on an “as-is, where-is” basis.<\/p>\n
Section 5.13 Brokers or Finders. Neither Parent, nor any of
\nits Subsidiaries or its Affiliates has entered into any Contract entitling any
\nagent, broker, investment banker,<\/p>\n
22<\/p>\n
financial advisor or other firm or Person to any broker’s or finder’s fee or any
\nother commission or similar fee in connection with any of the Transactions.<\/p>\n
Section 5.14 Form S-3 Eligibility. Parent meets the
\neligibility requirements for use of Form S-3 to provide for the registration and
\ncontinuous resale of the Parent Common Stock issued to the Company under this
\nAgreement pursuant to Rule 415 under the Securities Act.<\/p>\n
ARTICLE VI<\/p>\n
COVENANTS<\/p>\n
Section 6.1 Interim Operations. Except as set forth in
\nSchedule 6.1, during the period from the date hereof and continuing until the
\nearlier of the termination of this Agreement pursuant to Article IX or the
\nClosing, except as expressly provided in this Agreement or as may be consented
\nto in writing by Parent (such consent not to be unreasonably withheld or
\ndelayed):<\/p>\n
(a) the Company and each of the Company Subsidiaries
\nshall: (i) conduct its business in the same manner as heretofore conducted, only
\nin the ordinary course and in material compliance with all applicable Laws; (ii)
\npay its debts, taxes and other liabilities when due and perform other material
\nobligations when due; and (iii) use commercially reasonable efforts to (A)
\npreserve intact its present business organization, (B) except as provided in (f)
\nbelow keep available the services of its present officers and employees and (C)
\npreserve its relationships with customers, suppliers, distributors, licensors,
\nlicensees and other Persons with which it has significant business dealings;<\/p>\n
(b) no Company Subsidiary shall:<\/p>\n
(i) amend its Certificate of Incorporation
\n or Bylaws or similar organizational documents;<\/p>\n
(ii) issue, sell, transfer, pledge, dispose
\n of or encumber any shares of any class or series of its capital stock,
\n or securities convertible into or exchangeable for, or options,
\n warrants, calls, commitments or rights of any kind to acquire, any
\n shares of any class or series of its capital stock (except for the
\n issuance of capital stock issuable upon the exercise of options
\n outstanding as of the date hereof);<\/p>\n
(iii) set aside or pay any dividend or other
\n distribution payable in cash, stock or property with respect to any
\n shares of any class or series of its capital stock;<\/p>\n
(iv) split, combine or reclassify any shares
\n of any class or series of its stock; or<\/p>\n
23<\/p>\n
(v) redeem, purchase or otherwise acquire
\n directly or indirectly any shares of any class or series of its capital
\n stock, or any instrument or security which consists of or includes a
\n right to acquire such shares;<\/p>\n
(c) neither the Company nor any Company Subsidiary
\nshall: (i) incur or assume any Indebtedness, modify the terms of any
\nIndebtedness or other liability; (ii) assume or guarantee the obligations of any
\nother Person; (iii) enter into any “keep well” or other agreement to maintain
\nany financial statement condition of any other Person (other than any Company
\nSubsidiary); or (iv) enter into any arrangement having the economic effect of
\nany of the foregoing; provided, however, notwithstanding the foregoing, the
\nCompany shall not be restricted from incurring additional Indebtedness pursuant
\nto the terms of the Convertible Notes;<\/p>\n
(d) neither the Company nor any Company Subsidiary
\nshall make changes in the compensation (including equity compensation, whether
\npayable in cash or otherwise) or benefits payable or to become payable to any of
\ntheir employees, except in the ordinary course of business consistent with past
\npractice, but in no event which shall in the aggregate exceed $250,000;<\/p>\n
(e) neither the Company nor any Company Subsidiary
\nshall hire any employees other than in the ordinary course of business
\nconsistent with past practice; provided, however, that no Company or Company
\nSubsidiary shall hire any employee whose annual compensation would exceed
\n$100,000 without the prior approval of Parent, which such approval shall not be
\nunreasonably withheld or delayed;<\/p>\n
(f) neither the Company nor any Company Subsidiary
\nshall terminate any of their employees other than in the ordinary course of
\nbusiness consistent with past practice without the prior approval of Parent,
\nwhich such approval shall not be unreasonably withheld; provided, however, that
\nif the Company or any Company Subsidiary shall terminate any of their employees
\nprior to the Closing other than as directed by Parent, the Company shall pay all
\nseverance and other costs resulting from or arising out of such termination;<\/p>\n
(g) neither the Company nor any Company Subsidiary
\nshall voluntarily permit any insurance policy naming it as a beneficiary or a
\nloss payable payee to be cancelled or terminated;<\/p>\n
(h) neither the Company nor any Company Subsidiary
\nshall adopt a plan of complete or partial liquidation, dissolution, merger,
\nconsolidation, restructuring, recapitalization or other reorganization, or
\notherwise acquire or agree to acquire by merging or consolidating with, or by
\npurchasing any equity interest in or a portion of the assets of, or by any other
\nmanner, any business or any Person or division thereof, or otherwise acquire or
\nagree to acquire any assets which are material, individually or in the
\naggregate, to its business;<\/p>\n
(i) neither the Company nor any Company Subsidiary
\nshall change in any material respect any of the accounting methods used by it
\nunless required or permitted by GAAP;<\/p>\n
24<\/p>\n
(j) no Company Subsidiary shall make or change any
\nTax election, change an annual accounting period, adopt or change any material
\nTax accounting method, file any amended Tax Return, enter into any closing
\nagreement, settle or consent to any Tax claim, surrender any right to claim a
\nrefund of Taxes, or consent to the extension or waiver of the statutory period
\nof limitations applicable to any material Tax claim;<\/p>\n
(k) neither the Company nor any Company Subsidiary
\nshall voluntarily take, or agree to or commit to take, any action that would
\nresult in any of the conditions to the Closing set forth in Article VIII not
\nbeing satisfied, or would make any representation or warranty of the Company
\ncontained herein inaccurate in any material respect at, or as of any time prior
\nto, the Closing Date, or that would materially impair the ability of the parties
\nhereto to consummate the Transactions in accordance with the terms hereof or
\nmaterially delay such consummation;<\/p>\n
(l) neither the Company nor any Company Subsidiary
\nshall enter into any material partnership arrangements, material joint software
\ndevelopment agreements, material joint ventures or other material strategic
\nalliances or material strategic collaborations, except, in any case, as such are
\nterminable upon not more than thirty (30) days notice without material payment
\nor penalty of any kind;<\/p>\n
(m) neither the Company nor any Company Subsidiary
\nshall sell, lease, license, mortgage or otherwise encumber or dispose of any
\nproperties or assets which are material, individually or in the aggregate, to
\nits business, except sales, licenses or other dispositions in the ordinary
\ncourse of business consistent with past practice;<\/p>\n
(n) neither the Company nor any Company Subsidiary
\nshall make any loans, advances or capital contributions to, or investments in,
\nany other Person, other than loans or investments by the Company, or any Company
\nSubsidiary, to or in the Company or any Company Subsidiary;<\/p>\n
(o) neither the Company nor any Company Subsidiary
\nshall settle any claim, action or proceeding involving money damages, except to
\nthe extent subject to reserves reflected in the Financial Statements;<\/p>\n
(p) neither the Company nor any Company Subsidiary
\nshall subject itself, or the Parent, to any non-compete on any of their
\nrespective businesses;<\/p>\n
(q) neither the Company nor any Company Subsidiary
\nshall enter into any Contract the effect of which would be to grant to a third
\nparty following the Closing Date any actual or potential right of license to any
\nof its Intellectual Property, except for non-exclusive licenses of Trademarks or
\nCopyrights in the ordinary course of business consistent with past practice
\ngranted in connection with, or incidental to, the provision of services in the
\nordinary course of business consistent with past practice;<\/p>\n
(r) neither the Company nor any Company Subsidiary
\nshall grant any exclusive rights with respect to any of its Intellectual
\nProperty;<\/p>\n
25<\/p>\n
(s) neither the Company nor any Company Subsidiary
\nshall enter into, modify or amend in a manner adverse in any material respect to
\nsuch party any material Contract, terminate any material Contract, or waive,
\nrelease or assign any material rights or claims under any material Contract;
\nprovided, however, that neither this covenant nor any other provision in this
\nAgreement shall restrict the ability of the Company or any Company Subsidiary
\nfrom entering into advertising or paid inclusion agreements, Internet search
\nservices agreements or agreements involving payments by the Company of less than
\n$75,000, in each such case, which are entered into in the ordinary course of
\nbusiness and consistent with past practice; and<\/p>\n
(t) neither the Company nor any Company Subsidiary
\nshall enter into any Contract to do any of the foregoing.<\/p>\n
Section 6.2 Access to Information; Confidentiality.<\/p>\n
(a) Access to Information. Prior to the Closing, the
\nCompany and each Company Subsidiary shall: (i) give Parent and its authorized
\nrepresentatives reasonable access to all of its books, records, senior
\npersonnel, offices and other facilities and properties; (ii) permit Parent to
\nmake such copies and inspections thereof as Parent may reasonably request; and
\n(iii) cause its officers and other employees to furnish Parent with such
\nfinancial and operating data and other information with respect to its business
\nand properties, as from time to time Parent may reasonably request; provided,
\nhowever, that any such access shall be conducted at Parent’s expense, at a
\nreasonable time, under the supervision of personnel of the Company or such
\nCompany Subsidiary, as the case may be, and in such a manner as to maintain the
\nconfidentiality of this Agreement and the Transactions in accordance with the
\nterms hereof and not to interfere with the normal operation of the business of
\nthe Company or such Company Subsidiary, as the case may be. If and to the extent
\nthat Principal Stockholder shall be in possession or control, at any time prior
\nto the Closing, of any of the books, records, financial and operating data or
\nother information of or relating to the business and properties of the Company
\nor any Company Subsidiary, Principal Stockholder shall give Parent and its
\nauthorized representatives reasonable access to such books, records, financial
\nand operating data and other information to the same extent as provided above.
\nNotwithstanding the foregoing, no information or knowledge obtained by Parent
\nduring the course of any investigation conducted by Parent pursuant to this
\nSection 6.2(a) shall: (a) affect or be deemed to modify in any respect any of
\nthe representations or warranties of the Company or Principal Stockholder set
\nforth in this Agreement (or in any certificate, instrument or other document
\ndelivered by the Company or Principal Stockholder to Parent in connection with
\nthe Transactions), or the conditions to the obligations of the parties to
\nconsummate the Transactions in accordance with the terms and conditions hereof;
\n(b) be deemed to amend or supplement the Company Disclosure Schedule, prevent or
\ncure any misrepresentations, breach of warranty or breach of covenant by the
\nCompany or Principal Stockholder; or (c) otherwise limit or affect any remedies
\navailable to Parent as a result of or arising out of such disclosure. Nothing
\nherein shall require the Company to disclose any information to Parent if such
\ndisclosure would, in its sole and absolute discretion (A) jeopardize any
\nattorney-client or other legal privilege or (B) contravene any applicable Law,
\nfiduciary duty or binding agreement entered into prior to the date of this
\nAgreement (including any confidentiality agreement to which it or its Affiliates
\nis a party).<\/p>\n
26<\/p>\n
(b) Confidentiality. Parent, Principal Stockholder
\nand the Company acknowledge that they have previously executed a confidentiality
\nagreement, dated April 16, 2001, as amended (the “Confidentiality Agreement”),
\nwhich shall remain in full force and effect in accordance with its terms. All
\ninformation contained (i) herein, (ii) in the Company Disclosure Schedule, or
\n(iii) delivered to Parent, Principal Stockholder, the Company, or any of their
\nauthorized representatives pursuant hereto shall be deemed to be “Proprietary
\nInformation” (as defined and subject to the exceptions contained in the
\nConfidentiality Agreement) until the Closing Date.<\/p>\n
Section 6.3 Regulatory Filings; Commercially Reasonable
\nEfforts.<\/p>\n
(a) Regulatory Filings. Subject to the terms and
\nconditions herein, the Company, Principal Stockholder and Parent shall
\ncoordinate and cooperate with one another and shall use their respective
\ncommercially reasonable efforts to comply with, and shall refrain from taking
\nany action that would impede compliance with, all Laws, and as promptly as
\npracticable after the date hereof, shall make all filings, notices, petitions,
\nstatements, registrations, submissions for information, application or
\nsubmission of other documents required by any Governmental Entity in connection
\nwith the Transactions, including, without limitation: (i) Notification and
\nReport Forms with the Federal Trade Commission and the Antitrust Division of the
\nDepartment of Justice as required by the HSR Act; (ii) filings under applicable
\nforeign antitrust Laws; and (iii) any filings required under the Securities Act,
\nthe Exchange Act and any applicable state securities Laws or any other Laws
\nrelating to the Transactions. The Company, Principal Stockholder and Parent each
\nshall cause all documents that it is responsible for filing with any
\nGovernmental Entity under this Section 6.3(a) to comply in all material respects
\nwith all applicable Laws.<\/p>\n
(b) Exchange of Information. The Company, Principal
\nStockholder and Parent each shall promptly supply the other with any information
\nwhich may be required in order to effectuate any filing or application pursuant
\nto Section 6.3(a). Except where prohibited by applicable Laws, and subject to
\nthe Confidentiality Agreement, each of the parties shall consult with the other
\nprior to taking a position with respect to any such filing, shall permit the
\nother to review and discuss in advance, and consider in good faith the views of
\nthe other party in connection with any analyses, appearances, presentations,
\nmemoranda, briefs, white papers, arguments, opinions and proposals before making
\nor submitting any of the foregoing to any Governmental Entity by or on behalf of
\nany party in connection with any investigations or proceedings in connection
\nwith this Agreement or the Transactions (including under any antitrust,
\ncompetition or fair trade Laws), coordinate with the other in preparing and
\nexchanging such information and promptly provide the other (and its counsel)
\nwith copies of all filings, presentations or submissions (and a summary of any
\noral presentations) made by such party with any Governmental Entity in
\nconnection with this Agreement or the Transactions; provided, that with respect
\nto any such filing, presentation or submission, each of the parties need not
\nsupply the other party (or its counsel) with copies (or, in the case of oral
\npresentations, a summary) to the extent that any Law applicable to such party
\nrequires such party or its subsidiaries to restrict or prohibit access to any
\nsuch properties or information.<\/p>\n
(c) Notification. The Company, Principal Stockholder
\nand Parent each shall notify the other promptly upon its receipt of: (i) any
\ncomments from any officials of any<\/p>\n
27<\/p>\n
Governmental Entity in connection with any filings made pursuant to this
\nAgreement; and (ii) any request by any officials of any Governmental Entity for
\namendments or supplements to any filings made pursuant to, or information
\nprovided to comply in all material respects with, any Laws. Whenever any event
\noccurs that is required to be set forth in an amendment or supplement to any
\nfiling made pursuant to Section 6.3(a), each of the parties, as the case may be,
\nshall promptly inform the other party of such occurrence and cooperate in filing
\nwith the applicable Governmental Entity such amendment or supplement.<\/p>\n
(d) Efforts and Actions to Cause Closing to Occur.
\nUpon the terms and subject to the conditions set forth in this Agreement, the
\nCompany, Principal Stockholder and Parent each shall use its commercially
\nreasonable efforts to take, or cause to be taken, all actions, and to do, or
\ncause to be done, and to assist and cooperate with the other party in doing all
\nthings necessary, proper or advisable to consummate and make effective, in the
\nmost expeditions manner practicable, the Transactions, including using its
\ncommercially reasonable efforts to accomplish the following: (i) the taking of
\nall reasonable acts necessary to cause the conditions precedent set forth in
\nArticle VIII to be satisfied; (ii) the obtaining of all necessary actions or
\nnon-actions, waivers, consents, approvals, orders and authorizations from
\nGovernmental Entities and the making of all necessary registrations,
\ndeclarations and filings (including registrations, declarations and filings with
\nGovernmental Entities) and the taking of all reasonable steps as may be
\nnecessary to avoid any suit, claim, action, investigation or proceeding by any
\nGovernmental Entity; (iii) the obtaining of all Necessary Consents; (iv) the
\nresolution of such objections, if any, as may be asserted with respect to the
\nTransactions under the HSR Act, applicable foreign antitrust Laws or any other
\nantitrust, competition or fair trade Laws; (v) the defending of any suits,
\nclaims, actions, investigations or proceedings, whether judicial or
\nadministrative, challenging this Agreement or the consummation of the
\nTransactions, including seeking to have any stay or temporary restraining order
\nentered by any court or other Governmental Entity vacated or reversed; (vi) the
\nexecution or delivery of any additional instruments necessary to consummate the
\nTransactions and to fully carry out the purposes of this Agreement; and (vii)
\nobtain releases of all Encumbrances reflected in the Company Disclosure
\nSchedule; provided, however, that notwithstanding the foregoing or anything to
\nthe contrary set forth in this Agreement or in any agreement, certificate,
\ninstrument or other document delivered in connection with the Transactions,
\nnothing in this Agreement or in any agreement, certificate, instrument or other
\ndocument delivered in connection with the Transactions shall be deemed to
\nrequire Parent, the Company or Principal Stockholder, or any Subsidiary or
\nAffiliate thereof, to agree to any divestiture by itself or any of its
\nAffiliates of shares of capital stock or of any business, assets or property, or
\nthe imposition of any limitation on the ability of any of them to conduct their
\nbusinesses or to own or exercise control of such assets, properties and stock.<\/p>\n
Section 6.4 State Takeover Laws. If any state takeover law
\nbecomes or is deemed applicable to this Agreement or the Transactions, then the
\nCompany, Principal Stockholder and Parent each shall use its commercially
\nreasonable efforts to assist in any effort by the other party to render such
\nstatute inapplicable to the Transactions.<\/p>\n
Section 6.5 Third-Party Consents. As soon as practicable
\nfollowing the date hereof, the Company shall use commercially reasonable efforts
\nto obtain the consents, waivers and approvals, and to provide the notices,
\nrequired under Section 3.4 and Section 3.12(b)<\/p>\n
28<\/p>\n
(collectively, the “Consents”); provided, however, that the Company shall not be
\nrequired to pay any money, incur any liability or modify any Contract in any
\nmanner whatsoever materially adverse to the Company in connection with obtaining
\nany Consents. The Company shall keep Parent reasonably informed of its efforts
\nto obtain such consents, waivers and approvals (including reactions and
\nresponses of third parties thereto).<\/p>\n
Section 6.6 Publicity. The initial press release with respect
\nto the execution of this Agreement shall be a joint press release acceptable to
\nParent, Principal Stockholder and the Company. Thereafter, until the Closing, or
\nthe date the Transactions are terminated or abandoned pursuant to Article IX,
\nneither the Company, Principal Stockholder nor Parent, nor any of their
\nrespective Affiliates, shall issue or cause the publication of any press release
\nor other external public announcement with respect to this Agreement or the
\nTransactions without prior consultation with the other parties hereto, except as
\nmay be required by Law or by any listing agreement with a national securities
\nexchange or trading market; provided, however, that in the event that Parent,
\nPrincipal Stockholder and the Company are required by Law or by any listing
\nagreement with a national securities exchange or trading market to issue any
\npress release or make any public announcement with respect to this Agreement or
\nthe Transactions, the party required to issue such press release or make such
\npublic announcement shall consult in good faith with the other parties hereto
\nregarding the terms of such press release or the substance of any such public
\nannouncement.<\/p>\n
Section 6.7 Ancillary Agreements. Each of Parent, Principal
\nStockholder and the Company shall cause each of the Ancillary Agreements to
\nwhich it is intended to be a party to be executed and delivered to the other
\nparty at the Closing in accordance with the terms and subject to the conditions
\nset forth herein.<\/p>\n
Section 6.8 Subsequent Actions.<\/p>\n
(a) After the Closing, if Parent shall consider or be
\nadvised that any deeds, bills of sale, instruments of conveyance, assignments,
\nassurances or any other actions or things are necessary or desirable to vest,
\nperfect or confirm ownership (of record or otherwise) in Parent, its right,
\ntitle or interest in, to or under any or all of the Acquired Assets or otherwise
\nto carry out this Agreement, then the Company shall execute and deliver all
\ndeeds, bills of sale, instruments of conveyance, powers of attorney, assignments
\nand assurances and take and do all such other actions and things as may be
\nrequested by Parent in order to vest, perfect or confirm any and all right,
\ntitle and interest in, to and under such rights, properties or assets in Parent
\nor otherwise to carry out this Agreement.<\/p>\n
(b) After Closing, if the Company shall consider or
\nbe advised that any instruments of assumption or any other actions or things are
\nnecessary or desirable for the company to assign to Parent, and for Parent to
\nassume from the Company, any or all of the Assumed Liabilities or to otherwise
\ncarry out this Agreement, then Parent shall execute all documents and take and
\ndo all actions and things as may be requested by the Company in order for the
\nCompany to assign to Parent, and for Parent to assume from the Company, all
\nAssumed Liabilities or otherwise carry out this Agreement.<\/p>\n
29<\/p>\n
Section 6.9 Waiver of Bulk Sales Requirement. Each of the
\nparties waives compliance with any applicable bulk sales laws, including,
\nwithout limitation, the Uniform Commercial Code Bulk Transfer provisions.<\/p>\n
Section 6.10 Audited Financial Statements. As soon as
\npracticable after the date of this Agreement, but no later than fourteen (14)
\ncalendar days prior to the Closing Date, the Company shall deliver to Parent the
\nAudited Financial Statements.<\/p>\n
Section 6.11 Notice of Certain Matters. The Company and
\nPrincipal Stockholder shall give prompt notice to Parent of: (a) the occurrence
\nor non-occurrence of any event, the occurrence or non-occurrence of which could
\nreasonably be expected to cause any representation or warranty of the Company or
\nPrincipal Stockholder set forth in this Agreement to be untrue or inaccurate at
\nthe Closing or any time prior to the Closing such that any closing condition set
\nforth in Section 8.2(a) would not be satisfied; and (b) any failure of the
\nCompany or Principal Stockholder to comply with or satisfy any covenant or
\nagreement to be complied with by the Company or Principal Stockholder under this
\nAgreement at the Closing or at any time prior to the Closing such that any
\nclosing condition set forth in Section 8.2(b) would not be satisfied; provided,
\nhowever, that any disclosure by the Company or Principal Stockholder pursuant to
\nthis Section 6.11 shall not: (x) affect or be deemed to modify in any respect
\nany of the representations or warranties of the Company or Principal Stockholder
\nset forth in this Agreement (or in any certificate, instrument or other document
\ndelivered by the Company or Principal Stockholder (or any officer thereof) to
\nParent in connection with the Transactions), or the conditions to the
\nobligations of the parties to consummate the Transactions in accordance with the
\nterms and conditions hereof; (y) be deemed to amend or supplement the Company
\nDisclosure Schedule, or prevent or cure any misrepresentations, breach of
\nwarranty or breach of covenant by the Company or Principal Stockholder; or (z)
\notherwise limit or affect any remedies available to Parent as a result of or
\narising out of such disclosure, including, without limitation, Parent’s right to
\nindemnification under this Agreement.<\/p>\n
Section 6.12 Non-Transferable Assets.<\/p>\n
(a) Notwithstanding anything to the contrary set forth in
\nthis Agreement or in any of the Ancillary Agreements, nothing contained in this
\nAgreement or in any of the Ancillary Agreements shall be construed as, or
\nconstitute, an attempt, agreement or other undertaking to transfer or assign to
\nParent any asset, property or right that would otherwise constitute an Acquired
\nAsset, but that by its terms is not transferable or assignable to Parent
\npursuant to this Agreement without the consent, waiver, approval, authorization,
\nqualification or other order or one or more Governmental Authorities or other
\nPersons and if such consent, waiver, approval, authorization, qualification or
\nother order is not obtained prior to the Closing (each, a “Non-Transferable
\nAsset”).<\/p>\n
(b) From and after the Closing and, with respect to each
\nsuch Non-Transferable Asset, until the earlier to occur of (i) such time as such
\nNon-Transferable Asset shall be properly and lawfully transferred or assigned to
\nParent and (ii) such time as the material benefits intended to be transferred or
\nassigned to Parent have been procured by alternative means pursuant to Section
\n6.12(c) hereof, (A) the Non-Transferable Assets shall be held by the Company in
\ntrust exclusively for the benefit of Parent, and (ii) each of the Company,
\nPrincipal<\/p>\n
30<\/p>\n
Stockholder and Parent shall cooperate in any good faith, reasonable arrangement
\ndesigned to provide or cause to be provided for Parent the material benefits
\nintended to be transferred or assigned to Parent under each of the
\nNon-Transferable Assets and, in furtherance thereof, to the extent permitted
\nunder the terms of each such Non-Transferable Asset and under applicable Law (A)
\nParent shall use commercially reasonable efforts to perform and discharge all of
\nthe liabilities and other obligations of the Company under the terms of all such
\nNon-Transferable Assets in effect as of the Closing at Parent’s expense and (B)
\nthe Company and Principal Stockholder shall use commercially reasonable efforts
\nto provide or cause to be provided to Parent all of the benefits of the Company
\nunder the terms of such Non-Transferable Assets in effect as of the Closing,
\nincluding by promptly paying to Parent any monies received by the Company or
\nPrincipal Stockholder from and after the Closing under such Non-Transferable
\nAssets attributable to the performance of Parent thereunder.<\/p>\n
(c) In the event that the Company or Principal
\nStockholder is unable to obtain any consent from any Person under any
\nNon-Transferable Asset after the Closing Date through the use of commercially
\nreasonable efforts, Parent shall be entitled to procure the material rights and
\nbenefits of the Company under the terms of such Non-Transferable Asset in effect
\nas of the Closing by alternative means, including, without limitation, by
\nentering into new Contracts with third Persons or otherwise; provided, however,
\nthat in the event that the Company or Principal Stockholder shall exercise its
\nrights under this Section 6.12(c) in respect of any Non-Transferable Asset, the
\nobligations of the Company, Principal Stockholder and Parent under Section
\n6.12(b) in respect of such Non-Transferable Asset shall thereupon cease and
\nexpire.<\/p>\n
Section 6.13 Rule 145. The Company further covenants, for
\npurposes of and within the meaning of Rule 145 under the Securities Act, that
\nfor one (1) year after the date hereof, the Company’s Board of Directors will
\nnot: (a) adopt a plan or agreement that provides for dissolution of the Company;
\nor (b) adopt a plan or agreement that provides for a pro rata or similar
\ndistribution of the shares of Parent Common Stock to be delivered pursuant to
\nthe Transactions to the security holders of the Company.<\/p>\n
Section 6.14 Company Disclosure Schedule Supplement. The
\nCompany shall use commercially reasonable efforts to supplement Section 3.18(a)
\nof the Company Disclosure Schedule, within 30 days hereof, by adding information
\nidentifying: (a) pending U.S. and foreign patent applications; (b) U.S.
\ncopyright registrations; and (c) additional U.S. and foreign domain name
\nregistrations.<\/p>\n
ARTICLE VII<\/p>\n
ADDITIONAL AGREEMENTS<\/p>\n
Section 7.1 No Solicitation.<\/p>\n
(a) The Company and Principal Stockholder shall
\nimmediately cease any and all existing activities, discussions or negotiations
\nwith any parties conducted heretofore with respect to any Acquisition Proposal.<\/p>\n
31<\/p>\n
(b) During the period from the date hereof and
\ncontinuing until the earlier to occur of the termination of this Agreement
\npursuant to Article IX or the Closing, each of the Company and Principal
\nStockholder shall not and shall use its commercially reasonable efforts to cause
\neach of its current directors, current executive officers and other employees,
\naffiliates, representatives and other agents (including its financial, legal and
\naccounting advisors) not to, directly or indirectly: (i) solicit, initiate,
\nencourage, knowingly facilitate or induce any inquiry with respect to, or the
\nmaking, submission or announcement of, any Acquisition Proposal; (ii) furnish to
\nany Person any nonpublic information or take any other action to facilitate any
\ninquiries or the making of any proposal that constitutes or could reasonably be
\nexpected to lead to, any Acquisition Proposal; (iii) participate or engage in
\ndiscussions or negotiations with any Person with respect to any Acquisition
\nProposal, or the making of any proposal that constitutes or could reasonably be
\nexpected to lead to any Acquisition Proposal; (iv) approve, endorse or recommend
\nany Acquisition Proposal; or (v) enter into any letter of intent or similar
\ndocument or any Contract relating to any Acquisition Proposal.<\/p>\n
(c) As promptly as practicable after receipt of any
\nAcquisition Proposal or any request for nonpublic information or inquiry which
\nit reasonably believes could lead to an Acquisition Proposal, the Company or
\nPrincipal Stockholder, as the case may be, shall provide Parent with oral and
\nwritten notice of the terms and conditions of such Acquisition Proposal, request
\nor inquiry, and the identity of the Person or group making any such Acquisition
\nProposal, request or inquiry and a copy of all written materials provided in
\nconnection with such Acquisition Proposal, request or inquiry. The Company or
\nPrincipal Stockholder, as the case may be, shall provide Parent as promptly as
\npracticable oral and written notice setting forth all such information as is
\nreasonably necessary to keep Parent informed of the status and details
\n(including amendments or proposed amendments) of any such Acquisition Proposal,
\nrequest or inquiry and shall promptly provide to Parent a copy of all written
\nmaterials subsequently provided in connection with such Acquisition Proposal,
\nrequest or inquiry.<\/p>\n
(d) Without limiting the foregoing, it is understood
\nthat any violation of the restrictions set forth in this Section 7.1 by any
\ncurrent executive officer or current director of the Company or Principal
\nStockholder or any investment banker, attorney or representative of the Company
\nor Principal Stockholder shall be deemed to be a breach of this Section 7.1 by
\nthe Company.<\/p>\n
Section 7.2 Listing of Additional Shares. Prior to the
\nClosing Date, Parent shall use all commercially reasonable efforts to cause the
\nshares of Parent Common Stock issued to the Company pursuant to this Agreement
\nto be authorized for listing on the Nasdaq National Market (or such other stock
\nexchange or trading system on which the shares are then primarily trading),
\nsubject to notice of issuance.<\/p>\n
Section 7.3 Blue Sky Laws. Parent shall take such steps as
\nmay be necessary to comply with the securities and blue sky laws of all
\njurisdictions which are applicable to the issuance of the Parent Common Stock in
\nconnection with the Transactions. The Company shall use commercially reasonable
\nefforts to assist Parent as may be necessary to comply with the securities and
\nblue sky laws of all jurisdictions which are applicable in connection with the
\nissuance of Parent Common Stock in connection with the Transaction.<\/p>\n
32<\/p>\n
Section 7.4 Employee Matters.<\/p>\n
(a) Offers of Employment. Parent may offer employment
\neffective as of the Closing Date to any of the employees of the Company or any
\nCompany Subsidiary on terms and conditions, including provision of salary and
\nbenefits, which are comparable to, in the aggregate, similarly situated
\nemployees of Parent. Notwithstanding the forgoing, Parent may continue one or
\nmore of the Benefit Plans set forth on Schedule 7.4(b) if permissible by the
\nterms of such Benefit Plans, without the requirement of any payment by Company
\nor Principal Stockholder, in which case Parent shall have satisfied its
\nobligations hereunder with respect to the benefits so provided. Parent shall
\nmake its employment offers at least ten (10) Business Days prior to the Closing
\nDate and shall inform the Company of the employees who accept such offer of
\nemployment (the “Retained Employees”). The Company shall cooperate with Parent’s
\nreasonable requests for access to the employees of the Company and each Company
\nSubsidiary for purposes of making any employment offers and shall cease to
\nemploy any Retained Employee as of the Closing Date. In this regard, the Company
\nagrees to provide Parent, as soon as practical after the date hereof, a true and
\ncomplete list of all employees of the Company and any Company Subsidiary
\ntogether with their names, positions, dates of hire and current salary.<\/p>\n
(b) Compensation and Benefits. Effective as of the
\nClosing Date, the Company shall assign and Parent shall assume sponsorship of
\nall Benefit Plans set forth on Schedule 7.4(b) hereto and the parties shall
\ncooperate in obtaining such consent, as may be necessary, to effect such
\ntransfer of sponsorship. With respect to such Benefit Plans and all other
\nemployee benefits provided to the Retained Employees by Parent (i) service
\naccrued by each Retained Employee during employment with the Company or any
\nCompany Subsidiary prior to the Closing Date shall be recognized for all
\npurposes of eligibility, vesting and entitlement to benefits (except with
\nrespect to the provision of options or other equity compensation awards or to
\nthe extent necessary to prevent duplication of benefits) and (ii) all
\npre-existing condition limitations shall be waived to the same extent waived
\nunder the Benefit Plans or, if more favorable to such Retained Employee, the
\napplicable plan of Parent. If reasonably requested by Parent, the Company agrees
\nto provide Parent with sufficient information and otherwise cooperate with
\nParent so that it may satisfy its obligations under this Section 7.4(b).<\/p>\n
(c) Severance and WARN Obligations. At the Closing,
\nParent shall pay to the Company or on the Company’s behalf (upon receipt of a
\nrelease, except where payment is required under the WARN Act) severance pay and
\nrelated benefits to employees of the Company or any Company Subsidiary who are
\nnot offered employment with Parent and who do not become Retained Employees (the
\n“Non-Retained Employees”), in accordance with (i) applicable law, (ii) any
\nagreements giving rise to severance payments, and (iii) the Company’s severance
\npolicy set forth on Schedule 7.4(b). Parent shall reimburse the Company for all
\ncosts, including wages and benefits, associated with employing the Non-Retained
\nEmployees for the required period after the issuance of notices specified under
\nthe WARN Act or any similar state, local or foreign statute, regulation or, with
\nrespect to foreign employees, common-law requirement, or providing pay in lieu
\nof any such notice; provided, however, that the Company and any Company
\nSubsidiaries shall issue all such required notices no later than the Closing.<\/p>\n
(d) Non-Solicitation of Employees. At all times
\nduring the period commencing on the Closing Date and ending on the first (1st)
\nanniversary of the Closing Date,<\/p>\n
33<\/p>\n
Principal Stockholder shall not directly or indirectly solicit, encourage or
\ntake any other action which is intended to induce or encourage, or has the
\neffect of inducing of encouraging, any Retained Employee to terminate his or her
\nemployment therewith.<\/p>\n
Section 7.5 Form 10-K. Parent shall include in its Annual
\nReport on Form 10-K for the year 2002, the information required to be disclosed
\npursuant to Part III thereof without incorporating such information by reference
\nfrom the corresponding Proxy Statement pursuant to Section 14(a) of the Exchange
\nAct or such information shall be included in the registration statement
\ncontemplated by the Registration Rights Agreement attached hereto as Exhibit F
\nor in a Form 8-K filed prior to the initial filing of the registration
\nstatement.<\/p>\n
ARTICLE VIII<\/p>\n
CONDITIONS<\/p>\n
Section 8.1 Conditions to Each Party’s Obligation to Effect
\nthe Closing. The respective obligation of each of Parent, Principal Stockholder
\nand the Company to effect the Closing shall be subject to the satisfaction or
\nwaiver by Parent, Principal Stockholder and the Company at or prior to the
\nClosing Date of each of the following conditions:<\/p>\n
(a) Statutes; Court Orders. (i) No statute, rule or
\nregulation shall have been enacted or promulgated by any Governmental Entity
\nwhich has the effect of making the Transactions illegal; (ii) there shall be no
\norder or injunction of a court of competent jurisdiction in effect precluding
\nthe consummation of the Transactions; and (iii) there shall not be pending any
\nsuit, action or proceeding by any Governmental Entity seeking to restrain or
\nprohibit the consummation of the Transactions.<\/p>\n
(b) HSR and Foreign Antitrust Approvals. The
\napplicable waiting periods under the HSR Act and all applicable material foreign
\nantitrust approvals, as reasonably agreed upon by the parties hereto, shall have
\nexpired, been terminated or obtained, as applicable.<\/p>\n
(c) Securities Law; Compliance. The issuance of
\nshares of Parent Common Stock in connection with the Transactions shall be
\nexempt from the registration and prospectus delivery requirements of the
\nSecurities Act pursuant to Section 4(2) or Regulation D thereof.<\/p>\n
Section 8.2 Conditions to Obligations of Parent to Effect the
\nClosing. The obligations of Parent to consummate the Closing shall be subject to
\nthe satisfaction or waiver by Parent on or prior to the Closing Date of each of
\nthe following conditions:<\/p>\n
(a) Representations and Warranties. The
\nrepresentations and warranties of the Company and Principal Stockholder
\ncontained in this Agreement shall have been true and correct on the date hereof
\nand shall be true and correct as of the Closing Date with the same force and
\neffect as if made on the Closing Date (except that those representations and
\nwarranties which address matters only as of a particular date shall have been
\ntrue and correct only on such date), except in each case, or in the aggregate,
\nhas not had and would not reasonably be expected to have a Company Material
\nAdverse Effect; provided, however, that for purposes of<\/p>\n
34<\/p>\n
determining whether such representations and warranties were true and correct as
\nof the date hereof, or are true and correct as of the Closing Date, all
\n“materiality” and other similar qualifications, all “knowledge” and other
\nsimilar qualifications, and all qualifications based on the phrase “Company
\nMaterial Adverse Effect” contained therein shall be disregarded and given no
\neffect.<\/p>\n
(b) Agreements and Covenants. The Company and
\nPrincipal Stockholder shall have performed or complied in all material respects
\nwith all agreements and covenants required by this Agreement to be performed or
\ncomplied with by it at or prior to the Closing Date.<\/p>\n
(c) Stockholder Approval. Any and all consents or
\napprovals of the stockholders of the Company required under the applicable
\nprovisions of the DGCL, and under applicable terms of the Company’s Certificate
\nof Incorporation and Bylaws, in each case to authorize this Agreement and the
\nconsummation of the Transactions shall have been obtained, and shall not have
\nbeen rescinded, revoked or otherwise withdrawn in any respect.<\/p>\n
(d) Necessary Consents. The Company and Parent shall
\nhave received the consents set forth on Schedule 8.2(d), and any and all
\nconsents of third parties required in connection with the Transactions that were
\neither (i) entered into after the date hereof, or (ii) not disclosed to Parent
\nin the Company Disclosure Schedule, in each case to the extent that the failure
\nto obtain such consents would reasonably be expected to have a Company Material
\nAdverse Effect (the “Necessary Consents”), and none of such Necessary Consents
\nshall have been withdrawn or rescinded.<\/p>\n
(e) Audited Financial Statements. Parent shall have
\nreceived the Audited Financial Statements.<\/p>\n
(f) Company Material Adverse Effect. No Company
\nMaterial Adverse Effect shall have occurred since the date hereof and be
\ncontinuing.<\/p>\n
(g) Company Officer’s Certificate. The Company shall
\nhave delivered to Parent a certificate of its President or any Vice President
\ndated as of the Closing Date to the effect that each of the conditions specified
\nin Sections 8.2(a), (b), and (f), with respect to the Company, are satisfied in
\nall respects (the “Company Officer’s Certificate”).<\/p>\n
(h) Company Secretary’s Certificate. The Company
\nshall have delivered to Parent a certificate of its Assistant Secretary dated as
\nof the Closing Date (the “Company Secretary’s Certificate”), including: (i) an
\nincumbency certificate for the officers of the Company executing this Agreement
\nand other documents to be delivered to Parent pursuant to the terms hereof; (ii)
\nthe Certificate of Incorporation of the Company, as certified by the Secretary
\nof State of the State of Delaware and by the Assistant Secretary of the Company
\nas being true and complete as of the Closing Date; (iii) the Company’s Bylaws
\ncertified by the Secretary of the Company as being true and complete as of the
\nClosing Date; and (iv) a copy of the resolutions of the Company’s Board of
\nDirectors certified by the Assistant Secretary of the Company as of the Closing
\nDate authorizing the execution, delivery and performance of this Agreement and
\nthe consummation the Transactions.<\/p>\n
35<\/p>\n
(i) Principal Stockholder Officer’s Certificate.
\nPrincipal Stockholder shall have delivered to Parent a certificate of its
\nPresident or any Vice President dated as of the Closing Date to the effect that
\neach of the conditions specified in Sections 8.2(a), (b), and (f), with respect
\nto Principal Stockholder, are satisfied in all respects (the “Principal
\nStockholder Officer’s Certificate”).<\/p>\n
(j) Principal Stockholder Assistant Secretary’s
\nCertificate. Principal Stockholder shall have delivered to Parent a certificate
\nof its Assistant Secretary dated as of the Closing Date (the “Principal
\nStockholder Assistant Secretary’s Certificate”), including: (i) an incumbency
\ncertificate for the officers of Principal Stockholder executing this Agreement
\nand other documents to be delivered to Parent pursuant to the terms hereof; (ii)
\nthe Certificate of Incorporation of Principal Stockholder, as certified by the
\nSecretary of State of the State of Delaware and by the Assistant Secretary of
\nPrincipal Stockholder as being true and complete as of the Closing Date; (iii)
\nPrincipal Stockholder’s Bylaws certified by the Assistant Secretary of Principal
\nStockholder as being true and complete as of the Closing Date; and (iv) a copy
\nof the resolutions of the Principal Stockholder’s Board of Directors certified
\nby the Assistant Secretary of Principal Stockholder as of the Closing Date
\nauthorizing the execution, delivery and performance of this Agreement and the
\nconsummation the Transactions.<\/p>\n
(k) Ancillary Agreements. The Company and Principal
\nStockholder shall have executed, or caused to be executed, and delivered to
\nParent each of the Ancillary Agreements required of it to be executed and
\ndelivered in accordance with the terms hereof.<\/p>\n
Section 8.3 Conditions to Obligation of the Company and
\nPrincipal Stockholder to Effect the Closing. The obligation of the Company and
\nPrincipal Stockholder to consummate the Closing shall be subject to the
\nsatisfaction or waiver by the Company and Principal Stockholder on or prior to
\nthe Closing Date of each of the following conditions:<\/p>\n
(a) Representations and Warranties. The
\nrepresentations and warranties of Parent contained in this Agreement shall have
\nbeen true and correct on the date hereof and shall be as of the Closing Date
\nwith the same force and effect as if made on the Closing Date (except that those
\nrepresentations and warranties which address matters only as of a particular
\ndate shall have been true and correct only on such date), except, in each case,
\nor in the aggregate, as has not had and would not reasonably be expected to have
\na Parent Material Adverse Effect; provided, however, that for purposes of
\ndetermining whether such representations and warranties were true and correct as
\nof the date hereof, or are true and correct as of the Closing Date, all
\n“materiality” and other similar qualifications, all “knowledge” and other
\nsimilar qualifications, and all qualifications based on the phrase “Parent
\nMaterial Adverse Effect” contained therein shall be disregarded and given no
\neffect.<\/p>\n
(b) Agreements and Covenants. Parent shall have
\nperformed or complied in all material respects with all agreements and covenants
\nrequired by this Agreement to be performed or complied with by it at or prior to
\nthe Closing Date.<\/p>\n
(c) Parent Material Adverse Effect. No Parent
\nMaterial Adverse Effect shall have occurred since the date hereof and be
\ncontinuing.<\/p>\n
36<\/p>\n
(d) Parent Officer’s Certificate. Parent shall have
\ndelivered to the Company a certificate of its President or any Vice President
\ndated as of the Closing Date to the effect that each of the conditions specified
\nin Sections 8.3(a), (b) and (c), with respect to Parent, are satisfied in all
\nrespects (the “Parent Officer’s Certificate”).<\/p>\n
(e) Parent Secretary’s Certificate. Parent shall have
\ndelivered to the Company a certificate of its Secretary dated as of the Closing
\nDate (the “Parent Secretary’s Certificate”) including: (i) an incumbency
\ncertificate for Parent’s officers executing this Agreement and other documents
\nto be delivered to the Company pursuant to the terms hereof; (ii) Parent’s
\nCertificate of Incorporation, as certified by the Secretary of State of the
\nState of Delaware and by Parent’s Secretary as being true and complete as of the
\nClosing Date; (iii) Parent’s Bylaws certified by Parent’s Secretary as being
\ntrue and complete as of the Closing Date; and (iv) a copy of the resolutions of
\nParent’s Board of Directors certified by Parent’s Secretary as of the Closing
\nDate authorizing the execution, delivery and performance of this Agreement and
\nthe consummation the Transactions.<\/p>\n
(f) Ancillary Agreements. Parent shall have executed,
\nor caused to be executed, and delivered to the Company and Principal Stockholder
\neach of the Ancillary Agreements required of it to be executed and delivered in
\naccordance with the terms hereof.<\/p>\n
(g) Nasdaq Listing. The Parent Common Stock to be
\nissued to the Company pursuant to this Agreement at Closing shall have been
\nlisted on the Nasdaq National Market.<\/p>\n
ARTICLE IX<\/p>\n
TERMINATION<\/p>\n
Section 9.1 Termination. This Agreement may be terminated or
\nthe Transactions may be abandoned at any time prior to the Closing Date:<\/p>\n
(a) by the mutual written consent of Parent,
\nPrincipal Stockholder and the Company; or<\/p>\n
(b) if any Governmental Entity shall have issued an
\norder, decree or ruling or taken any other action which permanently restrains,
\nenjoins or otherwise prohibits the Transactions and such order, decree, ruling
\nor other action shall have become final and non-appealable; or<\/p>\n
(c) if the Transactions shall not have been
\nconsummated by May 1, 2003 (the “End Date”); provided, however, that the right
\nto terminate this Agreement pursuant to this Section 9.1(c) shall not be
\navailable to any party whose action or failure to act has been a principal cause
\nof or resulted in the failure of the Closing to occur on or before such date and
\nsuch action or failure to act constitutes a material breach of this Agreement;
\nor<\/p>\n
(d) by Parent, upon a breach of any representation,
\nwarranty, covenant or agreement on the part of the Company or Principal
\nStockholder set forth in this Agreement or if<\/p>\n
37<\/p>\n
any representation or warranty of the Company or Principal Stockholder shall
\nhave become untrue, in either case, such that the conditions set forth in
\nSection 8.2(a) or Section 8.2(b) would not be satisfied as of the time of such
\nbreach or as of the time such representation or warranty shall have become
\nuntrue; provided, that if such inaccuracy in the representations and warranties
\nof the Company or Principal Stockholder or breach by the Company or Principal
\nStockholder is curable by the Company or Principal Stockholder prior to the End
\nDate through the exercise of its commercially reasonable efforts, then Parent
\nmay not terminate this Agreement under this Section 9.1(d) prior to forty-five
\n(45) days following receipt of written notice by the Company and Principal
\nStockholder from Parent of such breach, so long as the Company and Principal
\nStockholder continue to exercise their commercially reasonable efforts to cure
\nsuch breach through such forty-five (45) day period (it being understood that
\nParent may not terminate this Agreement pursuant to this Section 9.1(d) if it
\nshall have materially breached this Agreement or if such breach by the Company
\nor Principal Stockholder is cured within such forty-five (45) day period); or<\/p>\n
(e) by the Company or Principal Stockholder, upon a
\nbreach of any representation, warranty, covenant or agreement on the part of
\nParent set forth in this Agreement or if any representation or warranty of
\nParent shall have become untrue, in either case such that the conditions set
\nforth in Section 8.3(a) or Section 8.3(b) would not be satisfied as of the time
\nof such breach or as of the time such representation or warranty shall have
\nbecome untrue; provided, that if such inaccuracy in Parent’s representations and
\nwarranties or breach by Parent is curable by Parent prior to the End Date
\nthrough the exercise of its commercially reasonable efforts, then neither the
\nCompany nor Principal Stockholder may terminate this Agreement under this
\nSection 9.1(e) prior to forty-five (45) days following Parent’s receipt of
\nwritten notice from the Company or Principal Stockholder of such breach, so long
\nas Parent continues to exercise its commercially reasonable efforts to cure such
\nbreach through such forty-five (45) day period (it being understood that neither
\nthe Company nor Principal Stockholder may terminate this Agreement pursuant to
\nthis Section 9.1(e) if it shall have materially breached this Agreement or if
\nsuch breach by Parent is cured within such forty-five (45) day period); or<\/p>\n
(f) by Parent, if a Company Material Adverse Effect
\nshall have occurred and be continuing as of the End Date; or<\/p>\n
(g) by the Company, if a Parent Material Adverse
\nEffect shall have occurred and be continuing as of the End Date; or<\/p>\n
(h) by Parent, if the Company shall have materially
\nand intentionally breached the terms of Section 7.1;<\/p>\n
provided, however, notwithstanding anything to the contrary set forth herein, in
\nthe event that the subsequent delivery of the Audited Financial Statements
\nresults in or implies a breach of the representations or warranties set forth in
\nSection 3.6 such that the condition set forth in Section 8.2(a) would not be
\nsatisfied, Parent’s sole remedy shall be to either (i) terminate this Agreement
\npursuant to Section 9.1(d) above or (ii) irrevocably waive the breach relating
\nto, and any claim resulting from, a breach of Section 3.6 that Parent may have
\nfor damages, indemnity or otherwise pursuant to Article XI or otherwise under
\nthis Agreement.<\/p>\n
38<\/p>\n
Section 9.2 Effect of Termination. In the event of the
\ntermination of this Agreement or abandonment of the Transactions by either the
\nCompany, Principal Stockholder or Parent pursuant to the terms of this
\nAgreement, written notice thereof shall forthwith be given to the
\nnon-terminating party or parties specifying the provision hereof pursuant to
\nwhich such termination of this Agreement or abandonment of the Transactions is
\nmade, and there shall be no liability or obligation thereafter on the part of
\nany party hereto except for fraud or for willful breach of this Agreement prior
\nto such termination of this Agreement or abandonment of the Transactions. Prior
\nto the Closing Date, termination shall be Parent’s sole remedy for breach of any
\nprovision of this Agreement by the Company or the Principal Stockholder, other
\nthan for willful and intentional breaches of this Agreement or breaches arising
\nout of fraud.<\/p>\n
ARTICLE X<\/p>\n
TAX MATTERS<\/p>\n
Section 10.1 Liability for Taxes.<\/p>\n
(a) The Company and Principal Stockholder shall be
\nresponsible for, pay or cause to be paid, and shall indemnify Parent and each of
\nits Affiliates (including the Company Subsidiaries after the Closing Date)
\n(collectively, the “Parent Tax Indemnitees”) and hold each Parent Tax Indemnitee
\nharmless from and against any liability for (i) Taxes of the Company for any
\nTaxable period other than Transfer Taxes for which Parent is responsible under
\nSection 10.5 of this Agreement, (ii) Taxes of each of the Company Subsidiaries
\nfor any taxable period (or portion thereof, as determined pursuant to Section
\n10.2(c)) that ends on or prior to the Closing Date (a “Pre-Closing Period”)
\nother than Transfer Taxes for which Parent is responsible under Section 10.5 of
\nthis Agreement and (iii) Taxes imposed on any consolidated, combined or unitary
\ngroup of which the Company or any Company Subsidiary has been a member;
\nprovided, however, that the Company and Principal Stockholders shall not
\nindemnify and hold harmless the Parent Tax Indemnitees from any liability for
\nTaxes for any Pre-Closing Period to the extent of reserves for Taxes (other than
\nany reserve for deferred Taxes established to reflect timing differences between
\nbook and Tax income) if any, set forth on the Balance Sheet. Principal
\nStockholder shall be entitled to any Tax Refunds to the extent that such Tax
\nRefunds relate to a Tax liability that is the responsibility of the Company or
\nPrincipal Stockholder under this Section 10.1(a).<\/p>\n
(b) Parent shall, except to the extent that such
\nTaxes are to be paid by the Company or Principal Stockholder under Section
\n10.1(a), be responsible for, pay or cause to be paid, and shall indemnify the
\nCompany, Principal Stockholder and each of their Affiliates (other than the
\nCompany Subsidiaries) (collectively, the “Company Tax Indemnitees”) and hold
\neach Company Tax Indemnitee harmless from and against all Taxes of, imposed upon
\nor relating to the Company Subsidiaries. Parent and the Company Subsidiaries
\nshall be entitled to any Tax Refunds of Taxes of the Company Subsidiaries except
\nfor Tax Refunds to which Principal Stockholder may be entitled under Section
\n10.1(a).<\/p>\n
(c) The covenants set forth in this Section 10.1 are
\nintended to be for the benefit of, and shall be enforceable by, each of the
\nParent Tax Indemnitees and the Company Tax Indemnitees, as the case may be, and
\ntheir respective heirs and successors.<\/p>\n
39<\/p>\n
Section 10.2 Filing Responsibility.<\/p>\n
(a) Principal Stockholder shall prepare and file, or
\ncause to be prepared and filed, when due: (i) all Tax Returns for any Principal
\nStockholder Affiliated Group which includes the Company or any Company
\nSubsidiary; and (ii) any Tax Return of any Company or any Company Subsidiary
\nthat includes a Pre-Closing Period and is due (giving effect to valid extensions
\nthereto) on or prior to the Closing Date. Such Tax Returns shall be prepared in
\naccordance with past practices, consistently applied. With respect to any such
\nTax Return, Parent shall pay Principal Stockholder any amount for which Parent
\nis responsible under Section 10.2(c) no later than five (5) Business Days prior
\nto the date such Tax Return is to be filed.<\/p>\n
(b) Parent shall, except to the extent that filing
\nsuch Tax Returns are the responsibility of Principal Stockholder under Section
\n10.2(a), prepare and file, or cause to be prepared and filed, all Tax Returns
\nwith respect to each Company Subsidiary. With respect to any such Tax Return,
\nPrincipal Stockholder shall pay Parent any amount for which Principal
\nStockholder is responsible under Section 10.2(c) no later than five (5) Business
\nDays prior to the date such Tax Return is to be filed.<\/p>\n
(c) Any Taxes for a taxable period beginning before
\nand ending after the Closing Date and the portion of any such Taxes allocable to
\nthe portion of such period ending on the Closing Date shall be deemed to equal
\n(i) in the case of Taxes that (x) are based upon or related to income or
\nreceipts or (y) imposed in connection with any sale or other transfer or
\nassignment of property, the amount which would be payable if the taxable year
\nended with the Closing Date, and (ii) in the case of other Taxes imposed on a
\nperiodic basis (including property Taxes), the amount of such Taxes for the
\nentire period multiplied by a fraction the numerator of which is the number of
\ncalendar days in the period ending with the Closing Date and the denominator of
\nwhich is the number of calendar days in the entire period. For purposes of the
\nprovisions of Section 10.1, each portion of such period shall be deemed to be a
\ntaxable period (whether or not it is in fact a taxable period).<\/p>\n
Section 10.3 Cooperation and Exchange of Information.<\/p>\n
(a) After the Closing, Principal Stockholder and
\nParent shall, and shall cause their respective Affiliates to: (i) assist the
\nother party in preparing any Tax Returns which such other party is responsible
\nfor preparing and filing in accordance with this Article X; (ii) cooperate fully
\nin preparing for and participating in any Audits of any Tax Returns relating in
\nwhole or in part to any Pre-Closing Period; and (iii) make available to the
\nother party as reasonably requested all information, records, documents, copies
\nof appropriate notices, and forms or other communications received from or sent
\nto any Tax Authority which relate to the Taxes of the Company or any Company
\nSubsidiary for any Pre-Closing Period; provided, however, that Principal
\nStockholder shall have the sole authority to make all determinations with
\nrespect to any Tax Returns relating to the Principal Stockholder Affiliated
\nGroup, and with respect to other Tax Returns to the extent that determinations
\nwith respect to such other Tax Returns may affect the amount of Taxes for which
\nthe Company or Principal Stockholder is liable, or Tax Refunds to which
\nPrincipal Stockholder is entitled, under Section 10.1(a); provided, however,
\nthat with respect to such other Tax Returns, Principal Stockholder shall be
\nrequired to obtain the consent of Parent before making any determination that
\ncould reasonably<\/p>\n
40<\/p>\n
be expected to materially adversely affect Parent or any Company Subsidiary,
\nwhich consent should not be unreasonably withheld or delayed.<\/p>\n
(b) For a period of time that is to continue until
\nsixty (60) days after the expiration of all applicable statutes of limitation
\n(giving effect to valid extensions thereto), Parent shall, and shall cause the
\nCompany Subsidiaries to, retain all Tax Returns, books and records of, or with
\nrespect to the activities of each of the Company Subsidiaries for all
\nPre-Closing Periods. Thereafter, Parent shall not, and shall cause each Company
\nSubsidiary not to, dispose of any such Tax Returns, books or records unless it
\nfirst offers such Tax Returns, books and records to Principal Stockholder and
\nPrincipal Stockholder fails to accept such offer within ninety (90) days of its
\nbeing made.<\/p>\n
(c) Parent shall promptly notify Principal
\nStockholder upon receipt by Parent or any of its Affiliates of notice of any
\nclaim, assessment or dispute relating to any Tax Proceeding which Principal
\nStockholder is entitled to control under this Section 10.3(c) and shall promptly
\nforward to Principal Stockholder any communications received from or sent to any
\nTax Authority in connection with any such Tax Proceeding; provided, however,
\nthat failure to give such notice shall not affect Parent’s right to
\nindemnification under this Article X except to the extent, if any, that but for
\nsuch failure, Principal Stockholder would have avoided all or a portion of the
\nTax liability that is the subject of the Tax Proceeding. Principal Stockholder
\nshall have the sole right to control, contest, resolve and defend any Tax
\nProceeding (i) with respect to Taxes of any Principal Stockholder Affiliated
\nGroup that includes the Company or any Company Subsidiary or (ii) which may
\naffect the amount of Taxes for which the Company or Principal Stockholder is
\nliable or responsible (or refunds or credits to which Principal Stockholder is
\nentitled) under Section 10.1(a). Notwithstanding any other provision of this
\nAgreement to the contrary, neither Parent, the Company Subsidiaries nor any of
\ntheir respective Affiliates shall be entitled to participate in any Tax
\nProceeding with respect to any Tax Return for any Principal Stockholder
\nAffiliated Group which includes the Company or any Company Subsidiary, nor shall
\nParent, the Company Subsidiaries or any of their respective Affiliates be
\nentitled to any information regarding any such Tax Return, except to the extent
\nrelating solely to any Company Subsidiary.<\/p>\n
Section 10.4 Tax Sharing Agreements. Anything in any other
\nagreement to the contrary notwithstanding, all liabilities and obligations
\nbetween Principal Stockholder or any member of the Principal Stockholder
\nAffiliated Group, on the one hand, and any of the Company Subsidiaries, on the
\nother hand, under any Tax allocation or Tax sharing agreement in effect prior to
\nthe Closing Date (other than this Agreement) shall cease and terminate as of the
\nClosing Date.<\/p>\n
Section 10.5 Transfer Taxes. Notwithstanding anything in this
\nAgreement to the contrary, Company shall be responsible for and shall pay the
\nfirst $3,000,000 of any documentary, sales, use, registration, value added,
\ntransfer, stamp and similar Taxes, fees and costs (collectively, “Transfer
\nTaxes”) incurred in connection with the Transactions, and Parent and Company
\nshall each be responsible for and shall pay 50% of any additional Transfer Taxes
\nabove $3,000,0000 incurred in connection with the Transactions.<\/p>\n
41<\/p>\n
Section 10.6 Section 338 Election. The Company and Parent
\nagree that an election under Section 338 of the Code (or any similar provision
\nof state, local or foreign law, as applicable) shall not be made with respect to
\nthe sale of the capital stock of the Company Subsidiaries pursuant to this
\nAgreement without the consent of the Principal Stockholder.<\/p>\n
Section 10.7 Survival. All rights and obligations under this
\nArticle X shall survive the Closing Date and continue until sixty (60) days
\nafter the expiration of all applicable statutes of limitation (giving effect to
\nvalid extensions thereto).<\/p>\n
Section 10.8 Scope of Remedy. Any claims for indemnification
\nrelating to Taxes shall be governed by the provisions of this Article X, except
\nthat in addition to the indemnity provided herein (but without duplication),
\nParent shall be entitled to make a claim against the Escrow Fund in accordance
\nwith Article XI. For the avoidance of doubt, none of the limitations on
\nindemnification set forth in Article XI shall apply to any claim for
\nindemnification relating to Taxes pursuant to Article X.<\/p>\n
Section 10.9 Disputes. If a dispute arises as to the
\ndetermination of the amount of any liability for Taxes under this Article X and
\nno agreement regarding the rights of the respective parties can be reached after
\ngood faith negotiation, the dispute shall promptly be resolved in accordance
\nwith the following procedure: each party shall select a nationally recognized
\naccounting firm. Such two nationally recognized accounting firms shall then in
\nturn mutually select a separate nationally recognized accounting firm not then
\nacting as the principal outside accountant for Parent, Principal Stockholder,
\nthe Company, or any of their respective Affiliates who shall then be designated
\nas the “Accounting Referee.” Parent and Principal Stockholder shall direct the
\nAccounting Referee to promptly review and make its final determination with
\nrespect to the disputed items or amounts. The decision of the Accounting Referee
\nas to the validity and amount of any claim shall be binding and conclusive upon
\nParent and Principal Stockholder. Parent, on the one hand, and Principal
\nStockholder, on the other hand, shall each bear its\/their own expenses
\n(including, attorneys’ fees and expenses) incurred in connection with any such
\ndispute resolution. The fees and expenses of the Accounting Referee shall be
\nborne equally by Parent, on the one hand, and the Company, out of the Escrow
\nFund on the other hand.<\/p>\n
42<\/p>\n
ARTICLE XI<\/p>\n
ESCROW AND INDEMNIFICATION<\/p>\n
Section 11.1 Escrow Fund. Within one (1) Business Day after
\nthe Closing, the Company shall deposit, or shall cause to be deposited, with an
\nescrow agent selected by the Company and reasonably acceptable to Parent (the
\n“Escrow Agent”), the Escrow Amount (together with any interest earned thereon or
\ndividends, distributions or other consideration paid therefor, the “Escrow
\nFund”), which shall be governed by the terms set forth herein and in the Escrow
\nAgreement. The Escrow Fund shall be available to compensate Parent or other
\nParent Indemnified Parties for Damages pursuant to the indemnification
\nobligations of the Company and Principal Stockholder set forth in this Article
\nXI.<\/p>\n
Section 11.2 Indemnification.<\/p>\n
(a) Subject to the limitations set forth in this
\nArticle XI, the Company and the Principal Stockholder shall indemnify and hold
\nharmless Parent, Parent’s officers, directors, agents and employees, and each
\nperson, if any, who controls or may control Parent within the meaning of the
\nSecurities Act (collectively, the “Parent Indemnified Parties”) from and against
\nany and all actual losses, costs, damages, liabilities, payments, obligations,
\nassessments, and expenses arising from claims, demands, actions, causes of
\naction and choses in action, including, without limitation, reasonable legal
\nfees and expenses incurred in connection with defending any claim or actions and
\nall amounts paid in settlement of any claims or actions to which the Company has
\ngiven prior written consent (collectively, “Damages”), which have been paid,
\nsuffered or incurred by such Parent Indemnified Parties as a result of or
\narising out of: (i) any breach of, or inaccuracy in, any of the representations,
\nwarranties or covenants made by the Company or Principal Stockholder in this
\nAgreement, the Company Officer’s Certificate or Principal Stockholder Officer’s
\nCertificate or (ii) any of the Excluded Liabilities.<\/p>\n
(b) The right to obtain indemnification pursuant to
\nSection 11.2(a), subject to the limitations of Section 11.4, shall be the Parent
\nIndemnified Parties’ sole and exclusive remedy for any breach by the Company,
\nAurora or the Principal Stockholder of the terms of this Agreement, or any other
\nclaim or matter arising out of or relating to the subject matter of this
\nAgreement, except as otherwise provided in Article X and except for claims
\narising from a breach based on fraud; provided, however, that, if the Closing
\ndoes not occur, the Parent Indemnified Parties shall have no right to
\nindemnification pursuant to the provisions of this Section 11.2(a) or otherwise
\nfor the breach by the Company, Aurora or Principal Stockholder of the terms of
\nthis Agreement other for than an intentional and willful breach of this
\nAgreement, or a breach based on fraud.<\/p>\n
(c) No Parent Indemnified Party shall be entitled to
\nreceive indemnification pursuant to the terms of Section 11.2(a)(i) (other than
\nfor an intentional and willful breach of a covenant or a breach of the
\nrepresentations and warranties in Sections 3.2, 3.25 or 4.2) unless and until
\nthe Damages for which the Parent Indemnified Parties are entitled to
\nindemnification pursuant to Section 11.2(a) (other than for an intentional and
\nwillful breach of a covenant or a breach of the representations and warranties
\nin Sections 3.2, 3.25 or 4.2) exceed five hundred thousand dollars ($500,000) in
\nthe aggregate (the “Indemnity Basket”), in which<\/p>\n
43<\/p>\n
case the Parent Indemnified Parties shall be entitled to recover the full amount
\nof such Damages, including the Indemnity Basket, up to the aggregate amount of
\nthe Escrow Fund.<\/p>\n
(d) The Parent Indemnified Party shall be entitled to
\nrecover the full amount of Damages up to the aggregate amount of the Escrow Fund
\neither: (i) if the Escrow Fund is comprised solely of cash at the time of
\npayment, in the form of cash; or (ii) if the Escrow Fund is comprised of both
\ncash and shares of Parent Common Stock at the time of payment, Damages shall be
\npaid in cash and by the cancellation of a number of shares of Parent Common
\nStock based on the ratio of cash and shares of Parent Common Stock then
\ncomprising the Escrow Fund where the value of the shares shall be determined by
\ndividing such amount of Damages allocated to the shares by the Average Closing
\nPrice.<\/p>\n
(e) The parties agree that there shall not be any
\nmultiple recovery as between the Company and the Principal Stockholder for any
\nDamages pursuant to the indemnification provisions of Section 11.2.<\/p>\n
(f) In calculating the amount of any indemnifiable
\nDamages for which the Parent Indemnified Parties are entitled to indemnification
\npursuant to Section 11.2(a)(i) (other than for an intentional and willful breach
\nof a covenant or a breach of the representations and warranties in Sections 3.2,
\n3.25 or 4.2), there shall be deducted the net present value of any actual Tax
\nbenefit which Parent in good faith determines that can actually be realized by
\nParent or a member of the Parent Affiliated Group in the taxable year which
\nincludes the date the claim is to be paid, in any prior taxable year, or in the
\nnext succeeding taxable year, net of any associated tax detriment (including tax
\ndetriments associated with the receipt of such indemnification payments received
\nby Parent or members of the Parent Affiliated Group in respect of such Damages).
\nParent’s determination shall be made after taking into account all other items
\nof income and deduction of Parent and all members of Parent’s affiliated group.<\/p>\n
(g) Unless otherwise required by applicable law or
\nGAAP, the parties agree that the payment of any Damages will be treated as an
\nadjustment to the Purchase Price for all Tax purposes.<\/p>\n
Section 11.3 Termination. The indemnity obligations of the
\nCompany and the Principal Stockholder set forth in Section 11.2(a)(i) with
\nrespect to a breach of a covenant to be performed prior to Closing or a
\nrepresentation and warranty of the Company or Principal Stockholder (other than
\nthe representations and warranties set forth in Sections 3.2, 3.25 and 4.2)
\nshall terminate at 11:59 p.m. California time on the twelve (12) month
\nanniversary of the Closing Date (the “Termination Date”); provided, however,
\nthat claims for indemnification made against the Escrow Fund or otherwise prior
\nto the Termination Date shall survive the Termination Date until finally
\nresolved. Parent and the Company jointly shall deliver to the Escrow Agent a
\ncertificate specifying the Closing Date.<\/p>\n
44<\/p>\n
Section 11.4 Claims upon Escrow Fund.<\/p>\n
(a) Upon receipt by the Escrow Agent on or before the
\nTermination Date of a certificate signed by any officer of Parent (an “Escrow
\nOfficer’s Certificate”):<\/p>\n
(i) stating that Damages exist in an
\n aggregate amount greater than the Indemnity Basket for claims against
\n the Escrow Fund, and<\/p>\n
(ii) specifying in reasonable detail the
\n individual items included in the amount of Damages in such claim, the
\n date each such item was paid, properly accrued or arose and the nature
\n of the misrepresentation, breach of warranty or claim to which such
\n item is related,<\/p>\n
the Escrow Agent shall set aside such number of shares of Parent Common Stock,
\nsuch amount of cash, or such combination thereof, as determined pursuant to
\nSection 11.2(d), having a value equal to the amount of such Damages.<\/p>\n
(b) The Escrow Agent shall deliver such number of
\nshares of Parent Common Stock, such amount of cash, or such combination thereof,
\nas determined pursuant to Section 11.2(d), having a value equal to the amount of
\nDamages claimed from the Escrow Fund to Parent as soon as practicable following
\nthe earliest of: (i) receipt of written authorization from the Company to make
\nsuch delivery; (ii) receipt of written notice of a final decision or order of a
\ncourt of competent jurisdiction of the claim; or (iii) the close of business on
\nthe thirtieth (30th) day following receipt by the Escrow Agent of an Escrow
\nOfficer’s Certificate to which the Company has not objected in accordance with
\nSection 11.5.<\/p>\n
(c) The Escrow Fund shall be the sole and exclusive
\nsource of recovery for the indemnity claims of the Parent Indemnified Parties
\nunder Section 11.2(a)(i) (other than for intentional and willful breach of
\ncovenants or a breach of the representations and warranties in Sections 3.2,
\n3.24 or 4.2), subject to the provisions of Section 11.2(b).<\/p>\n
(d) The Parent Indemnified Parties may not assert any
\nclaim directly against the Company (as opposed to through recourse to the Escrow
\nFund) or the Principal Stockholder unless and until it has reasonably determined
\nin good faith that the Escrow Fund shall not satisfy all then-existing and
\nunsatisfied claims. The Parent Indemnified Parties may not actually recover any
\nindemnification claims against the Principal Stockholder unless it also has
\nreasonably determined in good faith that the Escrow Fund and the resources of
\nthe Company shall not satisfy all then-existing and unsatisfied claims.<\/p>\n
Section 11.5 Objections to Claims. At the time of delivery of
\nany Escrow Officer’s Certificate to the Escrow Agent, a duplicate copy of such
\nEscrow Officer’s Certificate shall be delivered to each of the Company and
\nPrincipal Stockholder, and for a period of thirty (30) days after such delivery
\nto the Escrow Agent of such Escrow Officer’s Certificate, the Escrow Agent shall
\nnot make any payment from the Escrow Fund pursuant to Section 11.4 in respect of
\nthe claims described in such Escrow Officer’s Certificate unless the Escrow
\nAgent shall have received written authorization from the Company to make such
\ndelivery. As soon as practicable after the expiration of such thirty (30) day
\nperiod, the Escrow Agent shall deliver<\/p>\n
45<\/p>\n
such number of shares of Parent Common Stock, such amount of cash or such
\ncombination thereof, as determined pursuant to Section 11.2(d), having a value
\nequal to the Damages claimed from the Escrow Fund in accordance with Section
\n11.4; provided, that no such payment or delivery may be made if the Company
\nshall object in a written statement to the claim made in the Escrow Officer’s
\nCertificate specifying in reasonable detail the nature of such objection and the
\nbasis therefor under the terms of this Agreement, and such statement shall have
\nbeen delivered to the Escrow Agent and to Parent prior to the expiration of such
\nthirty (30) day period (the “Written Escrow Objection”).<\/p>\n
Section 11.6 Resolution of Conflicts.<\/p>\n
(a) In case the Company shall so object in writing to
\nany claim or claims by Parent made in any Escrow Officer’s Certificate pursuant
\nto Section 11.5, Parent shall have twenty (20) days after receipt by the Escrow
\nAgent of an objection by the Company to respond in a written statement to the
\nobjection of the Company. If after such twenty (20) day period there remains a
\ndispute as to any claims, the Company and Parent shall attempt in good faith for
\ntwenty (20) days to agree upon the rights of the respective parties with respect
\nto each of such claims. If the Company and Parent should so agree, a memorandum
\nsetting forth such agreement shall be prepared and signed by both parties and
\nshall be furnished to the Escrow Agent. The Escrow Agent shall be entitled to
\nrely on any such memorandum and shall make payments from the Escrow Fund in
\naccordance with the terms thereof.<\/p>\n
(b) If no agreement regarding the rights of the
\nrespective parties can be reached after good faith negotiation, either Parent or
\nthe Company may seek to resolve such dispute or claim in a court of competent
\njurisdiction or seek other legal or equitable resolution. Notwithstanding the
\nforegoing, any Parent Indemnified Party may at any time apply to any court of
\ncompetent jurisdiction for injunctive relief in connection with a claim for
\nindemnification or otherwise to prevent irreparable harm.<\/p>\n
Section 11.7 Third-Party Claims. In the event that Parent
\nbecomes aware of a third-party claim which Parent believes may result in a claim
\nfor indemnification, Parent shall promptly notify the Company of such claim, and
\nthe Company shall be entitled, at its expense, to participate in any defense of
\nsuch claim. Parent shall have the right in its sole discretion to settle any
\nclaim; provided, however, that Parent may not effect the settlement of any such
\nclaim (i) without the consent of the Company, which consent shall not be
\nunreasonably withheld or (ii) for which indemnity beyond the Escrow Fund will be
\nsought. In the event that the Company has consented to any such settlement, the
\nCompany shall have no power or authority to object under Section 11.5 or any
\nother provision of this Article XI to any claim by Parent against the Escrow
\nFund for indemnity in the amount of such settlement.<\/p>\n
Section 11.8 Tax Indemnification. Any claims for indemnity
\nrelating to Taxes shall be governed by the provisions of Article X, except that
\nin addition to the indemnity provided therein (but without duplication), Parent
\nshall be entitled to make a claim against the Escrow Fund in accordance with
\nthis Article XI. For the avoidance of doubt, none of the limitations on
\nindemnification pursuant to this Article XI shall apply to any claim for
\nindemnification relating to Taxes pursuant to Article X.<\/p>\n
46<\/p>\n
ARTICLE XII<\/p>\n
DEFINITIONS AND INTERPRETATION<\/p>\n
Section 12.1 Definitions. For all purposes of this Agreement,
\nexcept as otherwise expressly provided or unless the context clearly requires
\notherwise:<\/p>\n
“Accounting Referee” has the meaning set forth in Section
\n10.9.<\/p>\n
“Acquired Assets” means all of the right, title, and interest
\nthat the Company possesses and has the right to transfer in and to all of its
\nassets, including all of its: (a) tangible personal property (such as machinery,
\nequipment, inventories of raw materials and supplies, manufactured and purchased
\nparts, goods in process and finished goods, furniture, automobiles, trucks,
\ntractors, trailers, tools, jigs, and dies); (b) Intellectual Property, goodwill
\nassociated therewith, licenses and sublicenses granted and obtained with respect
\nthereto, and rights thereunder, remedies against infringements thereof, and
\nrights to protection of interests therein under the laws of all jurisdictions
\nand rights to past damages for infringement thereof; (c) leases, subleases, and
\nrights thereunder; (d) agreements, contracts, indentures, mortgages,
\ninstruments, liens, guaranties, other similar arrangements, and rights
\nthereunder; (e) accounts, notes, and other receivables; (f) securities
\n(including the capital stock or membership interests in the Company
\nSubsidiaries); (g) claims, deposits, prepayments, refunds, causes of action,
\nchoses in action, rights of recovery, rights of set-off, and rights of
\nrecoupment (including any such item relating to the payment of Taxes); (h)
\nfranchises, approvals, permits, licenses, orders, registrations, certificates,
\nvariances, and similar rights obtained from governments and governmental
\nagencies; and (i) books, records, ledgers, files, documents, correspondence,
\nlists, plats, architectural plans, drawings, and specifications, creative
\nmaterials, advertising and promotional materials, studies, reports, and other
\nprinted or written materials; provided, however, that the Acquired Assets shall
\nnot include (x) the corporate charter, qualifications to conduct business as a
\nforeign corporation, arrangements with registered agents relating to foreign
\nqualifications, taxpayer and other identification numbers, seals, minute books,
\nstock transfer books, blank stock certificates, and other documents relating to
\nthe organization, maintenance, and existence of the Company as a corporation;
\n(y) any cash or cash equivalent; or (z) any of the rights of the Company under
\nthis Agreement or any agreement entered into between the Company and Parent in
\nconnection with the Transactions.<\/p>\n
“Acquisition Proposal” means any offer or proposal relating to
\nany transaction or series of related transactions involving: (a) any purchase or
\nacquisition by any Person or “group” (as defined under Section 13(d) of the
\nExchange Act) of any equity interest or other voting securities of the Company
\nor any Company Subsidiary, whether by tender offer, exchange offer, merger,
\nconsolidation, business combination or similar transaction involving the Company
\nor any Company Subsidiary; (b) any purchase or acquisition by any Person or
\n“group” (as defined under Section 13(d) of the Exchange Act), or any sale,
\nlease, exchange, transfer, license or disposition by the Company or any Company
\nSubsidiary of, any assets or properties of the Company or any Company
\nSubsidiary, other than in the ordinary course of business; or (c) any
\nliquidation or dissolution of the Company or any Company Subsidiary.<\/p>\n
“Affiliate” has the meaning set forth in Rule 12b-2 of the
\nExchange Act.<\/p>\n
47<\/p>\n
“Agreement” or “this Agreement” means this Asset Purchase
\nAgreement, together with the Company Disclosure Schedule, Parent Disclosure
\nSchedule and the other exhibits and schedules hereto.<\/p>\n
“Ancillary Agreements” shall mean, collectively, the
\nIntellectual Property Assignments, the Escrow Agreement, the Bill of Sale, the
\nAssignment and Assumption Agreement, and the Registration Rights Agreement.<\/p>\n
“Assignment and Assumption Agreement” has the meaning set
\nforth in Section 2.3(b).<\/p>\n
“Assumed Liabilities” means all liabilities and obligations of
\nthe Company (whether known or unknown, whether asserted or unasserted, whether
\nabsolute or contingent, whether accrued or unaccrued, whether liquidated or
\nunliquidated, and whether due or to become due), including: (a) all liabilities
\nfor Taxes for which Parent is liable under Article X; (b) all liabilities and
\nobligations of the Company under the agreements, contracts, leases, licenses,
\nand other arrangements referred to in the definition of Acquired Assets; (c) all
\nliabilities and obligations of or relating to the Company with respect to
\nenvironmental matters, including without limitation those arising under
\nEnvironmental, Health, and Safety Requirements; (d) all liabilities for Taxes
\nfor which Parent is liable pursuant to Article X; (e) all liabilities and
\nobligations of or relating to the Company with respect to Benefit Plans listed
\non Schedule 7.4(b); and (f) all other liabilities and obligations of the Company
\nset forth in the Disclosure Schedule; provided, however, that the Assumed
\nLiabilities shall not include any Excluded Liabilities.<\/p>\n
“Audit” means any audit, assessment, or other examination
\nrelating to Taxes by any Tax Authority or any judicial or administrative
\nproceedings relating to Taxes.<\/p>\n
“Audited Financial Statements” means the audited consolidated
\nfinancial statements of the Company as of July 31, 2001 and July 31, 2002 and
\nfor the years ended July 31, 2000, July 31, 2001 and July 31, 2002, and the
\nunaudited financial statements at January 31, 2003 and the six months ended
\nJanuary 31, 2002 and January 31, 2003, each to be delivered with a SAS 71 report
\nwith respect to the unaudited financial statements.<\/p>\n
“Aurora” means Aurora I, LLC, a Delaware limited liability
\ncompany of which the Company is the sole member<\/p>\n
“Average Closing Price” has the meaning set forth in Section
\n1.3(a)(ii).<\/p>\n
“Balance Sheet” means the most recent unaudited balance sheet
\nof the Company and its consolidated Company Subsidiaries included in the
\nFinancial Statements.<\/p>\n
“Balance Sheet Date” means the date of the Balance Sheet.<\/p>\n
“Benefit Plan” means: (a) each deferred compensation, and each
\nmaterial incentive compensation, stock purchase, stock option and other material
\nequity compensation plan, program, agreement or arrangement; (b) each severance
\nor termination pay, medical, surgical, hospitalization, life insurance and other
\n“welfare” plan, fund or program (within the<\/p>\n
48<\/p>\n
meaning of Section 3(1) of ERISA); (c) each profit-sharing, stock bonus or other
\nmaterial “pension” plan, fund or program (within the meaning of Section 3(2) of
\nERISA); (d) each employment, termination or severance agreement; and (e) and
\neach other employee benefit plan, fund, program, agreement or arrangement, in
\neach case, that is sponsored, maintained or contributed to or required to be
\ncontributed to by the Company or any Company Subsidiary, or to which the Company
\nor any Company Subsidiary is party, whether written or oral, for the benefit of
\nany director, officer, consultant or employee of the Company or any Company
\nSubsidiary.<\/p>\n
“Bill of Sale” has the meaning set forth in Section 2.2(a).<\/p>\n
“Business Day” means a day other than Saturday, Sunday or any
\nday on which the principal commercial banks located in New York, New York or San
\nFrancisco, California are authorized or obligated to close under the laws of
\nsuch state.<\/p>\n
“Cash Consideration” has the meaning set forth in Section
\n1.3(a)(i).<\/p>\n
“Closing” has the meaning set forth in Section 2.1.<\/p>\n
“Closing Date” has the meaning set forth in Section 2.1.<\/p>\n
“COBRA” shall mean the Consolidated Omnibus Budget
\nReconciliation Act of 1985, as amended and as codified in Section 4980B of the
\nCode and Section 601 et. seq. of ERISA.<\/p>\n
“Code” means the Internal Revenue Code of 1986, as amended.<\/p>\n
“Company” means AltaVista Company, a Delaware corporation.<\/p>\n
“Company Disclosure Schedule” means the disclosure schedule of
\neven date herewith prepared and signed by the Company and delivered to Parent
\nsimultaneously with the execution hereof.<\/p>\n
“Company Intellectual Property” means any Intellectual
\nProperty owned by the Company or Company Subsidiary.<\/p>\n
“Company Material Adverse Effect” means any change, event,
\nviolation, inaccuracy, circumstance or effect (any such item, an “Effect”),
\nindividually or when taken together with all other Effects that have occurred
\nprior to the date of determination of the occurrence of the Company Material
\nAdverse Effect, that is or is reasonably likely to (a) be materially adverse to
\nthe business, assets (including intangible assets), financial condition or
\nresults of operations of the Company, taken as a whole with the Company
\nSubsidiaries or (b) materially impede the Company’s ability to consummate the
\nTransactions in accordance with the terms hereof and applicable Laws; provided,
\nhowever, that for purposes of clause (a) above, in no event shall any of the
\nfollowing, alone or in combination, be deemed to constitute, nor shall any of
\nthe following be taken into account in determining whether there has been or
\nshall be, a Company Material Adverse Effect: (A) any Effect resulting from
\ncompliance with the terms and conditions of this Agreement; (B) any Effect
\ndirectly related to the announcement or pendency of the Transactions; (C) any
\nEffect that results from changes affecting any of the industries in<\/p>\n
49<\/p>\n
which the Company operates generally or the United States economy generally
\nwhich does not have a disproportionate effect on the Company; or (D) any Effect
\nthat results from changes affecting general worldwide economic or capital market
\nconditions which does not have a disproportionate effect on the Company.<\/p>\n
“Company Material Contracts” has the meaning set forth in
\nSection 3.12(b).<\/p>\n
“Company Officer’s Certificate” has the meaning set forth in
\nSection 8.2(g).<\/p>\n
“Company Products” has the meaning set forth in Section
\n3.18(d).<\/p>\n
“Company Registered Intellectual Property” means Registered
\nIntellectual Property owned by the Company or any Company Subsidiary.<\/p>\n
“Company Secretary’s Certificate” has the meaning set forth in
\nSection 8.2(h).<\/p>\n
“Company Subsidiary” means each Person which is a Subsidiary
\nof the Company.<\/p>\n
“Company Tax Indemnitees” has the meaning set forth in Section
\n10.1(b).<\/p>\n
“Computer Software” means computer software programs
\n(including in object code and source form), databases and all documentation
\nrelated thereto.<\/p>\n
“Confidentiality Agreement” has the meaning set forth in
\nSection 6.2(b).<\/p>\n
“Consents” has the meaning set forth in Section 6.5.<\/p>\n
“Contract” means any agreement, contract, contract right,
\nlicense, evidence of Indebtedness, bond, note, mortgage, purchase and sale
\norder, quotation or other executory commitment, understanding or arrangement,
\nwhether or not in writing, in each case, as amended, supplemented or otherwise
\nmodified.<\/p>\n
“Convertible Notes” means: (a) the Convertible Demand Note,
\ndated August 18, 1999, by the Company to Principal Stockholder; (b) the
\nConvertible Demand Note, dated November 8, 2001, by the Company to Principal
\nStockholder; and (c) Convertible Demand Note, dated February 11, 2002, by the
\nCompany to Principal Stockholder and any other convertible debt issued by the
\nCompany to Principal Stockholder after the date of this Agreement.<\/p>\n
“Copyrights” means U.S. and foreign registered and
\nunregistered copyrights (including those in Computer Software and databases),
\nrights of publicity and all registrations and applications to register the same.<\/p>\n
“Damages” has the meaning set forth in Section 11.2(a).<\/p>\n
“DGCL” has the meaning set forth in the recitals.<\/p>\n
“Domain Names” means Internet domain name registrations and
\nInternet domain name registration applications.<\/p>\n
50<\/p>\n
“Encumbrances” means any and all liens, charges, assessments,
\nsecurity interests, options, claims, mortgages, pledges, proxies, voting trusts
\nor agreements, obligations, understandings or arrangements or other restrictions
\non title or transfer, except for Permitted Encumbrances.<\/p>\n
“End Date” has the meaning set forth in Section 9.1(c).<\/p>\n
“Environmental Law” means all foreign, federal, state or local
\nlaws governing pollution or the protection of the environment.<\/p>\n
“ERISA” means the Employee Retirement Income Security Act of
\n1974, as amended.<\/p>\n
“Escrow Agent” has the meaning set forth in Section 11.1.<\/p>\n
“Escrow Agreement” has the meaning set forth in the recitals.<\/p>\n
“Escrow Amount” has the meaning set forth in Section 1.4.<\/p>\n
“Escrow Fund” has the meaning set forth in Section 11.1.<\/p>\n
“Escrow Officer’s Certificate” has the meaning set forth in
\nSection 11.4.<\/p>\n
“Exchange Act” means the Securities Exchange Act of 1934, as
\namended.<\/p>\n
“Excluded Liabilities” means: (a) any liabilities under or
\nrelated to the Convertible Notes; (b) any claims by any stockholders of the
\nCompany (or any Person purporting to be a stockholder of the Company or
\notherwise having an equity or other ownership interest in the Company) in
\nrespect of this Agreement or the Transactions, whether made before or after the
\nClosing; (c) any claims by any stockholders of the Company against the directors
\nand officers of the Company (or any of them) or against any other stockholders
\nin respect of this Agreement or the Transaction, whether made before or after
\nthe Closing; (d) any and all liabilities and other obligations of the Company
\nunder its Certificate of Incorporation, Bylaws or any indemnification agreements
\nwith any officer or director, as in effect from time to time prior to the date
\nhereof and prior to the Closing, to indemnify, advance costs and expenses or
\notherwise compensate any Person; (e) any and all liabilities and other
\nobligations for costs and expenses (including fees and expenses of financial
\nadvisors, investment banks and legal counsel) incurred by the Company or any
\nCompany Subsidiary in connection with this Agreement and the Transactions
\n(including, without limitation, the fees and expenses payable to U.S. Bancorp
\nPiper Jaffray and Skadden, Arps, Slate, Meagher & Flom LLP as a result of, or in
\nconnection with, this Agreement and the Transactions), but excluding the fees
\nand expenses of KPMG in connection with preparing the Audited Financial
\nStatements; (f) any and all liabilities or obligations in respect of any success
\nor special bonus payments paid or payable to any employees of the Company or any
\nCompany Subsidiary arising out of, as a result of or in connection with, this
\nAgreement and the Transactions (or the sale, liquidation, dissolution or other
\nwinding up of any Company Subsidiary, division or other portion of the business
\nof the Company or any Subsidiary of the Company, whether or not related to this
\nAgreement or the Transactions); (g) any and all<\/p>\n
51<\/p>\n
liabilities or obligations to pay the premiums or other costs to procure a
\npolicy of directors’ and officers’ insurance covering the directors and officers
\nof the Company or, prior to the Closing, any Company Subsidiary; (h) any and all
\nliabilities or obligations in respect of any of the Company’s various stock
\nincentive plans and programs; (i) all liabilities for Taxes for which the
\nCompany or Principal Stockholder is liable under Article X; (j) any and all
\nclaims, debts, liabilities, commitments and obligations with respect to any
\nBenefit Plans not listed on Schedule 7.4(b) of the Company Disclosure Schedule;
\nand (k) any liability or obligation of the Company under this Agreement or other
\nagreement between the Company and Parent in connection with the Transactions.<\/p>\n
“Financial Statements” means (a) the unaudited consolidated
\nbalance sheet of the Company and the consolidated Company Subsidiaries as of
\nJuly 31, 2002, together with consolidated statements of income, shareholders’
\nequity and cash flows for each of the twelve month periods then ended and (b)
\nthe unaudited consolidated balance sheet of the Company and the consolidated
\nCompany Subsidiaries as of December 31, 2002, together with consolidated
\nstatements of income, stockholders’ equity and cash flows for each of the five
\n(5) month periods then ended.<\/p>\n
“GAAP” means United States generally accepted accounting
\nprinciples.<\/p>\n
“Governmental Entity” means a foreign, federal, state or local
\ncourt, arbitral tribunal, administrative agency or commission or other
\ngovernmental or other regulatory authority or agency.<\/p>\n
“HSR Act” means the Hart-Scott-Rodino Antitrust Improvements
\nAct of 1976, as amended.<\/p>\n
“Indebtedness” means (a) all indebtedness for borrowed money
\nor for the deferred purchase price of property or services (other than current
\ntrade liabilities incurred in the ordinary course of business and payable in
\naccordance with customary practices); (b) any other indebtedness that is
\nevidenced by a note, bond, debenture or similar instrument; (c) all obligations
\nunder financing leases; (d) all obligations in respect of acceptances issued or
\ncreated; (e) all liabilities secured by any Encumbrance on any property; and (f)
\nall guarantees of obligations of other Persons.<\/p>\n
“Indemnity Basket” has the meaning set forth in Section
\n11.2(c).<\/p>\n
“Intellectual Property” means Trademarks, Patents, Copyrights,
\nTrade Secrets and Domain Names.<\/p>\n
“Intellectual Property Assignments” means assignments of the
\nRegistered Intellectual Property on the Company Disclosure Schedule Section
\n3.18(a), each in a form reasonably acceptable to Parent, sufficient to record
\nwith the relevant authority (including, without limitation, the United States
\nPatent and Trademark Office), the assignment to Parent or its designee of each
\nitem of such Registered Intellectual Property.<\/p>\n
52<\/p>\n
“International Employee Plan” shall mean each Company Benefit
\nPlan or Employment Agreement that has been adopted or maintained by the Company
\nor any ERISA Affiliate, whether formally or informally or with respect to which
\nthe Company or any ERISA Affiliate will or may have any liability with respect
\nto Employees who perform services outside the United States.<\/p>\n
“IRS” means the Internal Revenue Service.<\/p>\n
“Knowledge of the Company” means the actual (and not
\nconstructive or imputed) knowledge of each of the Company’s executive officers
\nwith the title of vice-president or above.<\/p>\n
“Law” means any constitutional provision, law, statute, rule,
\nregulation, ordinance, treaty, order, decree, judgment, decision, certificate,
\nholding, injunction, rule, regulation or ruling enforceable at law or in equity,
\nalong with the interpretation and administration thereof by any Governmental
\nEntity charged with the interpretation or administration thereof.<\/p>\n
“Lease” means any contract pursuant to which the Company or
\nany Company Subsidiary leases or licenses any (a) real property or (b) personal
\nproperty that provides for annual future payments of more than $25,000 per
\nannum.<\/p>\n
“Licenses” means all licenses and agreements pursuant to which
\nthe Company or any Company Subsidiary has acquired rights in or to any
\nTrademarks, Patents, Copyrights, Trade Secrets or Domain Names, or licenses and
\nagreements pursuant to which the Company or any Subsidiary has licensed or
\ntransferred the right to use any of the foregoing.<\/p>\n
“Necessary Consents” has the meaning set forth in Section
\n8.2(d).<\/p>\n
“Non-Retained Employees” shall have the meaning set forth in
\nSection 7.4(c).<\/p>\n
“Non-Transferred Assets” shall have the meaning set forth in
\nSection 6.12(a).<\/p>\n
“Parent” means Overture Services, Inc., a Delaware
\ncorporation.<\/p>\n
“Parent Common Stock” has the meaning set forth in Section
\n1.3(a)(ii).<\/p>\n
“Parent Disclosure Schedule” means the disclosure schedule of
\neven date herewith prepared and signed by Parent and delivered to the Company
\nsimultaneously with the execution hereof.<\/p>\n
“Parent Indemnified Parties” has the meaning set forth in
\nSection 11.2(a).<\/p>\n
“Parent Material Adverse Effect” means any Effect,
\nindividually or when taken together with all other Effects that have occurred
\nprior to the date of determination of the occurrence of the Parent Material
\nAdverse Effect, that is or is reasonably likely to (a) be materially adverse to
\nthe business, assets (including intangible assets), capitalization, financial
\ncondition or results of operations of the Parent, taken as a whole with its
\nSubsidiaries or (b) materially impede the Parent’s authority to consummate the
\nTransactions in accordance with the<\/p>\n
53<\/p>\n
terms hereof and applicable Laws; provided, however, that for purposes of clause
\n(a) above, in no event shall any of the following, alone or in combination, be
\ndeemed to constitute, nor shall any of the following be taken into account in
\ndetermining whether there has been or shall be, a Parent Material Adverse
\nEffect: (A) any Effect resulting from compliance with the terms and conditions
\nof this Agreement; (B) any Effect directly related to the announcement or
\npendency of the Transactions; (C) any Effect that results from changes affecting
\nany of the industries in which Parent operates generally or the United States
\neconomy generally which does not have a disproportionate effect on Parent; or
\n(D) any Effect that results from changes affecting general worldwide economic or
\ncapital market conditions which does not have a disproportionate effect on
\nParent.<\/p>\n
“Parent Material Contracts” has the meaning set forth in
\nSection 5.9.<\/p>\n
“Parent Officer’s Certificate” has the meaning set forth in
\nSection 8.3(d).<\/p>\n
“Parent SEC Reports” has the meaning set forth in Section 5.6.<\/p>\n
“Parent Secretary’s Certificate” has the meaning set forth in
\nSection 8.3(e).<\/p>\n
“Parent Tax Indemnitees” has the meaning set forth in Section
\n10.1(a).<\/p>\n
“Patents” means issued U.S. and foreign patents and pending
\npatent applications, patent disclosures, and any and all divisions,
\ncontinuations, continuations-in-part, reissues, reexaminations, and extensions
\nthereof, any counterparts claiming priority therefrom, utility models, patents
\nof importation\/confirmation, certificates of invention and similar statutory
\nrights.<\/p>\n
“Permitted Encumbrances” means: (a) statutory liens, charges,
\nassessments, security interests, claims, obligations, understandings or
\narrangements for current Taxes or other governmental charges not yet due and
\npayable or the amount or validity of which is being contested in good faith by
\nappropriate proceedings for which adequate reserves have been established in
\naccordance with GAAP, which reserves are reflected in the Financial Statements;
\n(b) mechanic’s, carrier’s, warehouseman’s, landlord’s, materialman’s, worker’s,
\nrepairer’s and similar statutory liens, charges, assessments, security
\ninterests, options, claims, mortgages, pledges, obligations, understanding or
\narrangements arising or incurred in the ordinary course of business in amounts
\nwhich are not reasonably likely, individually or in the aggregate, to have a
\nCompany Material Adverse Effect; (c) zoning, entitlement, subdivision, building
\nand other land use regulations imposed by Governmental Entities having
\njurisdiction over such property which are not violated by the current use and
\noperation of such property; (d) covenants, conditions, restrictions,
\nrights-of-way, easements and other similar matters whether or not of record
\naffecting title to such property which do not materially interfere with the
\ncurrent use or the marketability of title of such property; (e) pledges or
\ndeposits in connection with, or to secure, workmen’s compensation, unemployment
\ninsurance pension or other employee benefits; (f) restrictions on transfer
\narising out of or related to securities Laws; and (g) any Encumbrance renewing,
\nextending or refunding any Encumbrance permitted hereunder.<\/p>\n
54<\/p>\n
“Person” means a natural person, partnership, corporation,
\nlimited liability company, business trust, joint stock company, trust,
\nunincorporated association, joint venture, Governmental Entity or other entity
\nor organization.<\/p>\n
“Pre-Closing Period” has the meaning set forth in Section
\n10.1(a).<\/p>\n
“Principal Stockholder” means CMGI, Inc., a Delaware
\ncorporation.<\/p>\n
“Principal Stockholder Affiliated Group” means any
\nconsolidated, combined or unitary group, for income Tax purposes, of which
\nPrincipal Stockholder is a member.<\/p>\n
“Purchase Price” has the meaning set forth in Section
\n1.3(a)(ii).<\/p>\n
“Registered Intellectual Property” shall mean all Patents,
\nregistered Copyrights and Copyright applications, registered Trademarks and
\nTrademark applications, and Domain Names.<\/p>\n
“Retained Employees” has the meaning set forth in Section
\n7.4(a).<\/p>\n
“SEC” means the Securities and Exchange Commission.<\/p>\n
“Securities Act” means the Securities Act of 1933, as amended.<\/p>\n
“Stock Consideration” has the meaning set forth in Section
\n1.3(a)(ii).<\/p>\n
“Stockholder Consent” has the meaning set forth in the
\nrecitals.<\/p>\n
“Subsidiary” means, with respect to any Person, (a) any
\ncorporation or other organization, whether incorporated or unincorporated, of
\nwhich (i) at least a majority of the securities or other interests having by
\ntheir terms ordinary voting power to elect a majority of the Board of Directors
\nor others performing similar functions with respect to such corporation or other
\norganization is directly or indirectly owned or controlled by such Person or by
\nany one or more of its Subsidiaries, or by such Person and one or more of its
\nSubsidiaries or (ii) such Person or any other Subsidiary of such Person is a
\ngeneral partner (excluding any such partnership where such Person or any
\nSubsidiary of such party does not have a majority of the voting interest in such
\npartnership) and (b) any limited liability company with respect to which such
\nPerson is the sole member.<\/p>\n
“Tax” or “Taxes” means all federal, state, local, and foreign
\ntaxes, and other assessments of a similar nature, including any interest,
\nadditions to tax, or penalties applicable thereto, imposed by any Tax Authority.<\/p>\n
“Tax Authority” means any domestic, foreign, national, state,
\ncounty or municipal or other local governmental entity, including any
\nsubdivision, agency, commission or authority thereof, or any quasi-governmental
\nbody exercising any Tax authority or any other entity exercising Tax regulatory
\nauthority.<\/p>\n
55<\/p>\n
“Tax Proceeding” means any Audit, contest, litigation,defense
\nor other proceeding with or against any Governmental Entity.<\/p>\n
“Tax Refunds” means any refund or credit of any Tax or any
\namount by which the reserves for Taxes set forth on the Balance Sheet exceed the
\nTax liability incurred in respect of such Taxes.<\/p>\n
“Tax Returns” means all returns, reports, and information
\nstatements required to be filed in connection with any Taxes.<\/p>\n
“Termination Date” has the meaning set forth in Section 11.3.<\/p>\n
“Trade Secrets” means all categories of trade secrets as
\ndefined in the Uniform Trade Secrets Act, including business information.<\/p>\n
“Trademarks” means U.S. and foreign registered and
\nunregistered trademarks, trade dress, service marks, logos, trade names,
\ncorporate names and all registrations and applications to register the same.<\/p>\n
“Transactions” has the meaning set forth in the recitals.<\/p>\n
“Transfer Taxes” has the meaning set forth in Section 10.5.<\/p>\n
“Written Escrow Objection” has the meaning set forth in
\nSection 11.5.<\/p>\n
Section 12.2 Interpretation.<\/p>\n
(a) The headings contained in this Agreement are for
\nreference purposes only and shall not affect in any way the meaning or
\ninterpretation of this Agreement.<\/p>\n
(b) Whenever the words “include,” “includes” or
\n“including” are used in this Agreement, they shall be deemed to be followed by
\nthe words “without limitation.”<\/p>\n
(c) The words “hereof,” “herein” and “herewith” and
\nwords of similar import shall, unless otherwise stated, be construed to refer to
\nthis Agreement as a whole and not to any particular provision of this Agreement,
\nand article, section, paragraph, exhibit and schedule references are to the
\narticles, sections, paragraphs, exhibits and schedules of this Agreement unless
\notherwise specified.<\/p>\n
(d) The meaning assigned to each term defined herein
\nshall be equally applicable to both the singular and the plural forms of such
\nterm, and words denoting any gender shall include all genders. Where a word or
\nphrase is defined herein, each of its other grammatical forms shall have a
\ncorresponding meaning.<\/p>\n
(e) A reference to any party to this Agreement or any
\nother agreement or document shall include such party’s successors and permitted
\nassigns.<\/p>\n
56<\/p>\n
(f) A reference to any legislation or to any
\nprovision of any legislation shall include any amendment to, and any
\nmodification or re-enactment thereof, any legislative provision substituted
\ntherefor and all regulations and statutory instruments issued thereunder or
\npursuant thereto.<\/p>\n
(g) The parties have participated jointly in the
\nnegotiation and drafting of this Agreement. In the event an ambiguity or
\nquestion of intent or interpretation arises, this Agreement shall be construed
\nas if drafted jointly by the parties, and no presumption or burden of proof
\nshall arise favoring or disfavoring any party by virtue of the authorship of any
\nprovisions of this Agreement.<\/p>\n
ARTICLE XIII<\/p>\n
MISCELLANEOUS<\/p>\n
Section 13.1 Fees and Expenses. All costs and expenses
\nincurred Parent in connection with this Agreement and the consummation of the
\nTransactions shall be paid by Parent. All costs and expenses incurred by the
\nCompany or Principal Stockholder in connection with this Agreement and the
\nconsummation of the Transactions shall be paid by the Company or Principal
\nStockholder, respectively. Notwithstanding the foregoing, Parent shall pay all
\ncosts and expenses payable to the Company’s independent accountants arising out
\nof the production of the Audited Financial Statements.<\/p>\n
Section 13.2 Amendment and Modification. This Agreement may
\nbe amended, modified and supplemented in any and all respects, but only by a
\nwritten instrument signed by each of the parties expressly stating that such
\ninstrument is intended to amend, modify or supplement this Agreement.<\/p>\n
Section 13.3 Notices. All notices, demands or requests which
\nmay be given by any party to the other party shall be in writing and shall be
\ndeemed to have been duly given on the date delivered in person, or sent via
\ntelefax, or on the next Business Day if sent by overnight courier, or on the
\ndate of the third (3rd) Business Day after deposit, postage prepaid, in the
\nUnited States mail via certified mail return receipt requested, and addressed as
\nset forth below:<\/p>\n
if to Parent, to:<\/p>\n
Overture Services, Inc.
\n 74 North Pasadena Avenue, 3rd Floor
\n Pasadena, CA 91103
\n Attention: Chief Financial Officer
\n Telephone No.: (626) 685-5600
\n Facsimile No.: (626) 685-5607<\/p>\n
with a copy to:<\/p>\n
57<\/p>\n
Wilson Sonsini Goodrich & Rosati
\n Professional Corporation
\n 650 Page Mill Road
\n Palo Alto, California 94304
\n Attention: Martin W. Korman, Esq.
\n Telephone No.: (650) 493-9300
\n Facsimile No.: (650) 493-6811
\n and to:<\/p>\n
Wilson Sonsini Goodrich & Rosati
\n Professional Corporation
\n One Market, Spear Street Tower
\n Suite 3300
\n San Francisco, California 94105
\n Attention: Michael S. Ringler, Esq.
\n Telephone No.: (415) 947-2000
\n Facsimile No.: (415) 947-2099<\/p>\n
if to the Company or Aurora I, LLC, to:<\/p>\n
AltaVista Company
\n 1070 Arastradero
\n Palo Alto, CA 94304
\n Attention: General Counsel
\n Telephone No.: (650) 320-7700
\n Facsimile No.: (650) 320-6433<\/p>\n
with a copy to:<\/p>\n
Skadden, Arps, Slate, Meagher & Flom LLP
\n 525 University Avenue
\n Palo Alto, CA 94301
\n Attention: Gregory C. Smith, Esq.
\n Telephone No.: (650) 470-4500
\n Facsimile No.: (650) 470-4570<\/p>\n
if to Principal Stockholder:<\/p>\n
CMGI, Inc.
\n 100 Brickstone Square
\n Andover, MA 01810
\n Attention: General Counsel
\n Telephone No.: (978) 684-3600
\n Facsimile No.: (978) 684-3601<\/p>\n
with a copy to:<\/p>\n
58<\/p>\n
Hale and Dorr LLP
\n 60 State Street
\n Boston, MA 02109
\n Attention: Mark G. Borden, Esq.
\n Telephone No.: (617) 526-6000
\n Facsimile No.: (617) 526-5000<\/p>\n
and a copy to:<\/p>\n
Browne Rosedale & Lanouette LLP
\n 100 Brickstone Square
\n First Floor
\n Andover, MA 01810
\n Attention: Thomas B. Rosedale, Esq.
\n Telephone No.: (978) 684-3840
\n Facsimile No.: (978) 684-3845<\/p>\n
The address to which such notices, demands, requests,
\nelections or other communications are to be given by either party may be changed
\nby written notice given by such party to the other party pursuant to this
\nSection 13.3.<\/p>\n
Section 13.4 Counterparts. This Agreement may be executed in
\nany number of counterparts, all of which shall be considered one and the same
\nagreement and shall become effective when counterparts have been signed by each
\nof the parties and delivered to the other party.<\/p>\n
Section 13.5 Entire Agreement; No Third Party Beneficiaries.
\nThis Agreement, the Ancillary Agreements and the Confidentiality Agreement (a)
\nconstitute the entire agreement and supersede all prior agreements and
\nunderstandings, both written and oral, among the parties with respect to the
\nsubject matter hereof and thereof and (b) are not intended to confer any rights
\nor remedies upon any Person other than the parties, the Parent Indemnified
\nParties pursuant to Section 11.2(a), and the indemnified parties and indemnitees
\ncontemplated by Articles X and XI.<\/p>\n
Section 13.6 Severability. Any term or provision of this
\nAgreement that is held by a court of competent jurisdiction or other authority
\nto be invalid, void or unenforceable in any situation in any jurisdiction shall
\nnot affect the validity or enforceability of the remaining terms and provisions
\nhereof or the validity or enforceability of the offending term or provision in
\nany other situation or in any other jurisdiction. If the final judgment of a
\ncourt of competent jurisdiction or other authority declares that any term or
\nprovision hereof is invalid, void or unenforceable, the parties agree that the
\ncourt making such determination shall have the power to reduce the scope,
\nduration, area or applicability of the term or provision, to delete specific
\nwords or phrases, or to replace any invalid, void or unenforceable term or
\nprovision with a term or provision that is valid and enforceable and that comes
\nclosest to expressing the intention of the invalid or unenforceable term or
\nprovision.<\/p>\n
59<\/p>\n
Section 13.7 Governing Law. This Agreement shall be governed
\nby and construed in accordance with the laws of the State of Delaware without
\ngiving effect to the principles of conflicts of law thereof.<\/p>\n
Section 13.8 Venue. Each of the parties: (a) consents to
\nsubmit itself to the personal jurisdiction of any federal court located in the
\nState of Delaware or any Delaware state court in the event any dispute that the
\nparties fail to resolve arises out of this Agreement or any of the Transactions;
\n(b) agrees that it shall not attempt to deny or defeat such personal
\njurisdiction by motion or other request for leave from any such court; and (c)
\nagrees that it shall not bring any action relating to this Agreement or any of
\nthe Transactions in any court other than a federal or state court sitting in the
\nState of Delaware.<\/p>\n
Section 13.9 Extension; Waiver. At any time prior to the
\nClosing Date, either party may: (a) extend the time for the performance of any
\nof the obligations or other acts of the other party; (b) waive any inaccuracies
\nin the representations and warranties of the other party contained in this
\nAgreement or in any document delivered pursuant to this Agreement; or (c) waive
\ncompliance by the other party with any of the agreements or conditions contained
\nin this Agreement. Any agreement on the part of a party to any such extension or
\nwaiver shall be valid only if set forth in an instrument in writing signed by or
\non behalf of such party. The failure of any party to this Agreement to assert
\nany of its rights under this Agreement or otherwise shall not constitute a
\nwaiver of those rights.<\/p>\n
Section 13.10 Assignment; Successors. Neither this Agreement
\nnor any of the rights, interests or obligations hereunder shall be assigned by
\nany of the parties (whether by operation of Law or otherwise) without the prior
\nwritten content of the other party. Subject to the preceding sentence, this
\nAgreement shall be binding upon, inure to the benefit of and be enforceable by
\nthe parties and their respective successors and assigns. If Parent or any of its
\nsuccessors or assigns (a) consolidates with or merges into any other person and
\nshall not be the continuing or surviving corporation or entity of such
\nconsolidation or merger or (b) transfers or conveys all or substantially all of
\nits properties and assets to any person, then, and in each such case, to the
\nextent necessary to effectuate the purpose of this Agreement, Parent (or any of
\nits successors and assigns) shall make proper provision so that the successors
\nand assigns of Parent shall succeed to the obligations set forth in this
\nAgreement and none of the actions described in clauses (a) or (b) shall be taken
\nuntil such provision is made.<\/p>\n
Section 13.11 Survival. The covenants to be performed prior
\nto the Closing set forth in this Agreement shall not survive the Closing and
\nshall terminate, and be of no further force or effect, upon the Closing. The
\nrepresentations and warranties set forth in this Agreement shall survive the
\nClosing for the Escrow Period and shall thereafter terminate and be of no
\nfurther force or effect.<\/p>\n
Section 13.12 WAIVER OF RIGHT TO JURY. EACH OF PARENT, THE
\nCOMPANY AND PRINCIPAL STOCKHOLDER HEREBY IRREVOCABLY WAIVES ALL RIGHT TO TRIAL
\nBY JURY AND ANY ACTION, PROCEEDING OR COUNTERCLAIM (WHETHER BASED ON CONTRACT,
\nTORT, OR OTHERWISE) ARISING OUT OF OR RELATING TO THIS AGREEMENT OR THE ACTIONS
\nOF ANY PARTY HERETO IN<\/p>\n
60<\/p>\n
NEGOTIATION, ADMINISTRATION, PERFORMANCE OR ENFORCEMENT HEREOF, OR THE
\nTRANSACTIONS.<\/p>\n
[REMAINDER OF PAGE INTENTIONALLY LEFT BLANK]<\/p>\n
61<\/p>\n
IN WITNESS WHEREOF, Parent, the Company and Principal
\nStockholder each have executed this Agreement as of the date first written
\nabove.<\/p>\n
OVERTURE SERVICES, INC.<\/p>\n
By: \/s\/ Todd Tappin
\n —————————————-
\n Name: Todd Tappin
\n Title: CFO<\/p>\n
ALTAVISTA COMPANY<\/p>\n
By: \/s\/ James J. Barnett
\n —————————————-
\n Name: James J. Barnett
\n Title: President and CEO<\/p>\n
CMGI, INC.<\/p>\n
By: \/s\/ Peter L. Gray
\n —————————————————
\n Name: Peter L. Gray
\n Title: Executive Vice President and General Counsel<\/p>\n
SIGNATURE PAGE TO ASSET PURCHASE AGREEMENT<\/p>\n
AURORA I, LLC<\/p>\n
By: \/s\/ James J. Barnett
\n _______________________________________<\/p>\n
Name: James J. Barnett
\n _______________________________________<\/p>\n
President and CEO of Alta Vista Company, its sole member
\n President of Aurora I, LLC.
\n Title: _________________________________________________________<\/p>\n
SIGNATURE PAGE TO ASSET PURCHASE AGREEMENT<\/p>\n
63<\/p>\n","protected":false},"template":"","meta":{"_acf_changed":false,"_stopmodifiedupdate":true,"_modified_date":"","_cloudinary_featured_overwrite":false},"corporate_contracts_companies":[7128,8435],"corporate_contracts_industries":[9417],"corporate_contracts_types":[9623,9622],"class_list":["post-43305","corporate_contracts","type-corporate_contracts","status-publish","hentry","corporate_contracts_companies-cmgi-inc","corporate_contracts_companies-overture-services-inc","corporate_contracts_industries-financial__holding","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\/43305","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=43305"}],"wp:term":[{"taxonomy":"corporate_contracts_companies","embeddable":true,"href":"https:\/\/corporate.findlaw.com\/legal-api\/wp-json\/wp\/v2\/corporate_contracts_companies?post=43305"},{"taxonomy":"corporate_contracts_industries","embeddable":true,"href":"https:\/\/corporate.findlaw.com\/legal-api\/wp-json\/wp\/v2\/corporate_contracts_industries?post=43305"},{"taxonomy":"corporate_contracts_types","embeddable":true,"href":"https:\/\/corporate.findlaw.com\/legal-api\/wp-json\/wp\/v2\/corporate_contracts_types?post=43305"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}