1
ASSET PURCHASE AGREEMENT
dated as of
October 21, 1996
between
GN Great Nordic as
and
GN Netcom/Unex Inc.
and
Dynatech Corporation
and
UNEX Corporation
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TABLE OF CONTENTS
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ARTICLE 1
DEFINITIONS
SECTION 1.01. Definitions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1
ARTICLE 2
PURCHASE AND SALE
SECTION 2.01. Purchase and Sale . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5
SECTION 2.02. Excluded Assets . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7
SECTION 2.03. Assumed Liabilities . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7
SECTION 2.04. Excluded Liabilities . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8
SECTION 2.05. Assignment of Contracts and Rights . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8
SECTION 2.06. Purchase Price; Allocation of Purchase Price . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9
SECTION 2.07. Closing . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10
SECTION 2.08. Closing Balance Sheet . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10
SECTION 2.09. Adjustment of Purchase Price . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 12
SECTION 2.10. Apportionment . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 12
ARTICLE 3
REPRESENTATIONS AND WARRANTIES OF DYNATECH AND SELLER
SECTION 3.01. Corporate Existence and Power . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 13
SECTION 3.02. Subsidiaries . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 13
SECTION 3.03. Corporate Authorization . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 13
SECTION 3.04. Governmental Authorization . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 13
SECTION 3.05. Non-contravention . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 14
SECTION 3.06. Finders' Fees . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 14
SECTION 3.07. Properties . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 14
SECTION 3.08. Sufficiency of and Title to the Purchased Assets . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 15
SECTION 3.09. Financial Statements . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 16
SECTION 3.10. Accounts Receivable . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 16
SECTION 3.11. Absence of Certain Changes . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 16
SECTION 3.12. Required and Other Consents . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 17
SECTION 3.13. Intellectual Property . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 18
SECTION 3.14. Litigation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 18
SECTION 3.15. Insurance Coverage . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 19
SECTION 3.16. Environmental Compliance . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 19
SECTION 3.17. Licenses and Permits . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 20
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SECTION 3.18. Customers and Distributors . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 20
SECTION 3.19. Transactions with Affiliates . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 20
SECTION 3.20. Inventories . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 20
SECTION 3.21. Material Contracts . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 21
SECTION 3.22. Compliance with Laws and Court Orders . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 22
SECTION 3.23. Employees . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 22
SECTION 3.24. Products . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 22
SECTION 3.25. No Undisclosed Material Liabilities . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 23
SECTION 3.26. DISCLAIMER . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 23
SECTION 3.27. Definition of Knowledge . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 23
ARTICLE 4
REPRESENTATIONS AND WARRANTIES OF BUYER AND GREAT NORDIC
SECTION 4.01. Organization and Existence . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 23
SECTION 4.02. Corporate Authorization . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 24
SECTION 4.03. Governmental Authorization . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 24
SECTION 4.04. Non-contravention . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 24
SECTION 4.05. Litigation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 24
SECTION 4.06. Finders' Fees . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 24
SECTION 4.07. Financing . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 24
ARTICLE 5
COVENANTS OF SELLER
SECTION 5.01. Confidentiality . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 25
SECTION 5.02. Notices of Certain Events. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 26
SECTION 5.03. Noncompetition . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 26
SECTION 5.04. Unex Name . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 27
ARTICLE 6
COVENANTS OF BUYER
SECTION 6.01. Provision of Financial Information . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 27
SECTION 6.02. Management Services . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 27
ARTICLE 7
COVENANTS OF BOTH PARTIES
SECTION 7.01. Best Efforts; Further Assurances . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 27
SECTION 7.02. Certain Filings . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 28
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SECTION 7.03. Public Announcements . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 28
SECTION 7.04. WARN Act . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 28
ARTICLE 8
TAX MATTERS
SECTION 8.01. Tax Definitions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 29
SECTION 8.02. Tax Matters . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 30
SECTION 8.03. Tax Cooperation; Allocation of Taxes . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 30
ARTICLE 9
EMPLOYEE BENEFITS
SECTION 9.01. Employee Benefits Definitions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 31
SECTION 9.02. ERISA Representations . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 32
SECTION 9.03. Employees and Offers of Employment . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 33
SECTION 9.04. Seller's Employee Benefit Plans . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 34
SECTION 9.05. Buyer Benefit Plans . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 35
SECTION 9.06. No Third Party Beneficiaries . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 36
ARTICLE 10
SURVIVAL; INDEMNIFICATION
SECTION 10.01. Survival . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 36
SECTION 10.02. Indemnification . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 37
SECTION 10.03. Environmental Indemnification . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 38
SECTION 10.04. ACS Litigation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 38
SECTION 10.05. Procedures . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 38
SECTION 10.06. Payment of Claims; Arbitration . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 39
SECTION 10.07. Calculation of Damages . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 39
SECTION 10.08. Limitation on Remedies . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 39
ARTICLE 11
MISCELLANEOUS
SECTION 11.01. Notices . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 40
SECTION 11.02. Amendments and Waivers . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 41
SECTION 11.03. Expenses . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 42
SECTION 11.04. Successors and Assigns . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 42
SECTION 11.05. Arbitration . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 42
SECTION 11.06. Governing Law . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 43
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SECTION 11.07. Counterparts; Effectiveness . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 43
SECTION 11.08. Entire Agreement; Third Party Beneficiaries . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 43
SECTION 11.09. Bulk Sales Laws . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 43
SECTION 11.10. Captions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 43
Exhibit A Balance Sheet dated as of June 30, 1996
Exhibit B Assignment and Assumption Agreement
Exhibit C Bill of Sale
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ASSET PURCHASE AGREEMENT
AGREEMENT dated as of October 21, 1996 between Dynatech Corporation, a
Massachusetts corporation ("DYNATECH"), UNEX Corporation, a Massachusetts
corporation (the "SELLER") GN Great Nordic as, a Danish corporation ("GREAT
NORDIC") and GN Netcom/Unex Inc., a Delaware corporation (the "BUYER"),
W I T N E S S E T H :
WHEREAS, Seller is engaged in the business of designing, manufacturing
and marketing telephone headsets and related accessories for the premium and
general business segments of the telephone headset market (the "BUSINESS");
WHEREAS, Buyer desires to purchase substantially all of the assets of
the Business from Seller, and Seller desires to sell substantially all of the
assets of the Business to Buyer, upon the terms and subject to the conditions
hereinafter set forth;
NOW, THEREFORE, in consideration of the foregoing and the
representations, warranties, covenants and agreements herein contained, the
parties hereto agree as follows:
ARTICLE 1
DEFINITIONS
SECTION 1.01. DEFINITIONS. (a) The following terms, as used herein,
have the following meanings:
"AFFILIATE" means, with respect to any Person, any other Person
directly or indirectly controlling, controlled by, or under common control with
such other Person.
"BALANCE SHEET" means the unaudited balance sheet of the Business as
of June 30, 1996 referred to in SECTION 3.09. "BALANCE SHEET DATE" means June
30, 1996, attached as Exhibit A hereto." BASE NET WORKING CAPITAL" means
$4,462,300.
"BUSINESS DAY" means any day except a Saturday, Sunday or other day on
which commercial banks in New York are authorized by law to close.
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"CAUSE" means (i) employee's willful and continued failure
substantially to perform his or her duties hereunder (other than as a result of
total or partial incapacity due to physical or mental illness), (ii) dishonesty
in the performance of employee's duties hereunder, (iii) an act or acts on
employee's part constituting a felony under the laws of the United States or
any state thereof or (iv) any other act or omission which is materially
injurious to the financial condition or business reputation of the Company or
any of its subsidiaries or affiliates.
"CERCLA" means the Comprehensive Environmental Response, Compensation
and Liability Act of 1980, as amended from time to time and any rules or
regulations promulgated thereunder.
"CLOSING BALANCE SHEET" means an audited balance sheet, at Buyer's
sole cost and expense, of the Purchased Assets and the Assumed Liabilities as
at the close of business on the Closing Date, together with the notes thereto.
"CLOSING DATE" means the date of the Closing.
"CLOSING NET WORKING CAPITAL" means the excess of the value of the
current assets over the amount of the current liabilities as reflected on the
Closing Balance Sheet prepared in accordance with Dynatech's standard
accounting policy for its consolidated operations, which policy conforms with
generally accepted accounting principles applied on the basis consistent with
the Balance Sheet.
"CORPORATE RECORDS" means Seller's corporate seals, corporate
franchise, Articles of Incorporation, By-Laws, stock record books, corporate
record books containing minutes of meetings of directors and stockholders and
such other records as have to do exclusively with Seller's organization or
stock capitalization.
"ENVIRONMENTAL LAWS" means any and all federal, state, local and
foreign laws, treaties, judicial decisions, regulations, rules, judgments,
orders, decrees, injunctions, permits, agreements and governmental
restrictions, whether now or hereafter in effect, relating to the environment,
human health and safety or to pollutants, contaminants, wastes or chemicals or
any toxic, radioactive ignitable, corrosive, reactive or otherwise hazardous
substances, materials or wastes.
"ENVIRONMENTAL LIABILITIES" means any and all liabilities of or
relating to Seller (including any entity which is, in whole or in part, a
predecessor of Seller) or arising in connection with or in any way relating to
the Business, the Purchased Assets or activities or operations occurring or
conducted at the Real Property (including, without limitation, offsite
disposal), whether vested or unvested, contingent or fixed, actual or
potential, known or unknown, which (i) arise under or relate to Environmental
Laws and (ii) relate to actions occurring or conditions
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existing on or prior to the Closing Date (including, without limitation, any
matter disclosed or required to be disclosed in Schedule 3.16).
"ENVIRONMENTAL PERMITS" means all permits, licenses, authorizations,
certificates and approvals of governmental authorities relating to or required
by Environmental Laws and necessary or proper for the Business as currently
conducted.
"FINAL NET WORKING CAPITAL" means Closing Net Working Capital (i) as
shown in Buyer's calculation delivered pursuant to SECTION 2.08(b) if no notice
of disagreement with respect thereto is delivered pursuant to Section 2.08(c)
or (ii) if such a notice of disagreement is delivered, (A) as agreed by the
parties pursuant to Section 2.08(d) or (B) in the absence of such agreement, as
shown in the Accounting Referee's calculation delivered pursuant to Section
2.08(d); provided that Final Net Working Capital shall not in any event be less
than Buyer's calculation of Closing Net Working Capital delivered pursuant to
Section 2.08(b) nor more than Seller's calculation of Closing Net Working
Capital delivered pursuant to Section 2.08(c).
"HAZARDOUS SUBSTANCES" means any pollutant, contaminant, waste or
chemical or any toxic, radioactive, ignitable, corrosive, reactive or otherwise
hazardous substance, waste or material having any constituent elements
displaying any of the foregoing characteristics, including, without limitation,
petroleum, its derivatives, by-products and other hydrocarbons, or any
substance, waste or material regulated under Environmental Laws.
"HSR ACT" means the Hart-Scott-Rodino Antitrust Improvements Act of
1976, as amended.
"INTELLECTUAL PROPERTY RIGHT" means any trademark, service mark, trade
name, invention, patent, trade secret, know-how, copyright, (including any
registration or applications for registration of any of the foregoing) or any
other similar type of proprietary intellectual property right, in each case
which is owned or licensed by Seller or any Affiliate of Seller and used or
held for use in the Business.
"LIEN" means, with respect to any property or asset, any mortgage,
lien, pledge, charge, security interest, encumbrance or other adverse claim of
any kind in respect of such property or asset. For the purposes of this
Agreement, a Person shall be deemed to own subject to a Lien any property or
asset which it has acquired or holds subject to the interest of a vendor or
lessor under any conditional sale agreement, capital lease or other title
retention agreement relating to such property or asset.
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"MATERIAL ADVERSE CHANGE" means a material adverse change in the
business, assets, condition (financial or otherwise) or result of operations of
the Business (other than the Excluded Assets) taken as a whole.
"MATERIAL ADVERSE EFFECT" means a material adverse effect on the
business, assets, condition (financial or otherwise) or result of operations of
the Business taken as a whole.
"PERSON" means an individual, corporation, limited liability company,
partnership, association, trust or other entity or organization, including a
government or political subdivision or an agency or instrumentality thereof.
(b) Each of the following terms is defined in the Section set
forth opposite such term:
Term Section
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Accounting Referee 2.06
ACS 10.04
Active Employee 9.03
Apportioned Obligations 8.03
Allocation Statement 2.06
Assumed Liabilities 2.03
Benefit Arrangements 9.02
Books and Records 5.01
Bulk Sales 11.09
Bulk Transfer 11.09
Closing 2.07
Code 8.01
Contracts 2.01
Conveyance Documents 2.07
Employee Benefit Plan 9.02
Employee Plans 9.01
ERISA 9.01
ERISA Affiliate 9.01
Excluded Assets 2.02
Excluded Liabilities 2.04
Final Determination 8.01
Financial Statements 3.09
ICC 11.05
Indemnified Party 10.04
Indemnifying Party 10.04
International Plan 9.01
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Litigation 10.04
Loss 10.02
Multiemployer Plan 9.01
Other Consent 3.12
Parties 11.05
Permit 3.17
Permitted Lien 3.07
Petty Cash 2.01
Post-Closing Tax Period 8.01
Pre-Closing Tax Period 8.01
Purchased Assets 2.01
Purchase Price 2.06
Real Property 3.07
Required Consent 3.12
Tax 8.01
Transfer Taxes 8.03
Transferred Employee 9.03
WARN Act 7.04
ARTICLE 2
PURCHASE AND SALE
SECTION 2.01. PURCHASE AND SALE. Except as otherwise provided below, upon
the terms and subject to the conditions of this Agreement, Buyer agrees to
purchase from Seller and Seller agrees to sell, convey, transfer, assign and
deliver, or cause to be sold, conveyed, transferred, assigned and delivered, to
Buyer at Closing, free and clear of all Liens, other than Permitted Liens, all
of Seller's right, title and interest in, to and under the assets, properties
and business, of every kind and description, wherever located, real, personal
or mixed, tangible or intangible, owned, held or used in the conduct of the
Business by Seller as the same shall exist on the Closing Date, including all
assets shown on the Balance Sheet and not disposed of in the ordinary course of
business, and all assets of the Business thereafter acquired by Seller (the
"PURCHASED ASSETS"), and including, without limitation, all right, title and
interest of Seller in, to and under:
(a) all leases of, and other interests in, real property
currently used in the conduct of the Business, together with all buildings,
fixtures, and improvements erected thereon, including without limitation
the items listed on Schedule 3.07(a);
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(b) all personal property and interests therein, including
machinery, equipment, furniture, office equipment, communications
equipment, leasehold improvements, vehicles and other tangible property,
including without limitation the items listed on Schedule 3.07(b);
(c) all raw materials, work-in-process, finished goods,
supplies and other inventories;
(d) all rights under all contracts, agreements, leases,
licenses, commitments, sales and purchase orders and other instruments,
including without limitation the items listed on Schedule 3.21
(collectively, the "CONTRACTS");
(e) all accounts, notes and other receivables;
(f) all prepaid expenses, including but not limited to ad
valorem taxes, leases and rentals, except those excluded on Schedule 2.02;
(g) all petty cash located at operating facilities of the
Business ("PETTY CASH");
(h) all of Seller's rights, claims, credits, causes of action
or rights of set-off against third parties relating to the Purchased
Assets, including, without limitation, unliquidated rights under
manufacturers' and vendors warranties;
(i) all patents and all pending patent applications, in each
case owned or licensed by Seller or any Affiliate of Seller and used or
held for use in the Business, including without limitation the items listed
on Schedule 3.13;
(j) all patents, copyrights, trademarks, trade names,
servicemarks, service names, technology, know-how, processes, trade
secrets, inventions, proprietary data, formulae, research and development
data, computer software programs and other intangible property (including
the "UNEX Corporation" name and any derivative thereof) and any
applications for the same, in each case owned or licensed by Seller or any
Affiliate of Seller and used or held for use in the Business, including
without limitation the items listed on Schedule 3.13;
(k) all transferable licenses, permits or other governmental
authorization affecting, or relating in anyway to, the Business, including
without limitation the items listed on Schedule 3.17;
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(l) all books, records, files and papers, whether in hard copy
or computer format, used in the Business, excluding the Corporate Records
but including, without limitation, engineering information, sales and
promotional literature, manuals and data, sales and purchase
correspondence, lists of present and former suppliers, lists of present and
former customers, personnel and employment records (other than such records
which in Seller's good faith opinion is sensitive or the disclosure of
which would subject Seller to risk of liability), and any information
relating to Tax imposed on the Purchased Assets;
(m) all goodwill associated with the Business or the Purchased
Assets, together with the right to represent to third parties that Buyer is
the successor to the Business; and
(n) Seller's agreement not to compete as set forth in Section
5.03 hereof.
SECTION 2.02. EXCLUDED ASSETS. Buyer expressly understands and agrees that
the following assets and properties of Seller (the "EXCLUDED ASSETS"), as set
forth in Schedule 2.02, shall be excluded from the Purchased Assets:
(a) all of Seller's cash and cash equivalents on hand and in
banks, except for Petty Cash;
(b) insurance policies;
(c) Corporate Records; and
(d) all intercompany accounts receivable.
SECTION 2.03. ASSUMED LIABILITIES. Upon the terms and subject to the
conditions of this Agreement, Buyer agrees, effective at the time of Closing,
to assume the following liabilities (the "ASSUMED LIABILITIES"):
(a) the following current liabilities as set forth on the
Balance Sheet: Accounts Payable Trade; Accrued Consulting; Advertising; and
Miscellaneous;
(b) all liabilities and obligations of Seller arising under
the Contracts (other than liabilities or obligations attributable to any
failure by Seller to comply with the terms thereof) other than those
specified as Excluded Liabilities in Section 2.04;
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(c) all warranty obligations relating to the Business and, as
described in Section 9.03(b) hereof, any salary continuation obligations
arising after the Closing.
SECTION 2.04. EXCLUDED LIABILITIES. Notwithstanding any provision
in this Agreement or any other writing to the contrary, Buyer is assuming only
the Assumed Liabilities and is not assuming any other liability or obligation
of Seller (or any predecessor owner of all or part of its businesses and
assets) of whatever nature, whether presently in existence or arising
hereafter. All such other liabilities and obligations shall be retained by and
remain obligations and liabilities of Seller (all such liabilities and
obligations not being assumed being herein referred to as the "EXCLUDED
LIABILITIES"), and, notwithstanding anything to the contrary in this Section
2.04, none of the following shall be Assumed Liabilities for the purposes of
this Agreement:
(a) any liability set forth on the Balance Sheet other than
those expressly assumed pursuant to Section 2.03(a);
(b) any obligation or liability for Tax other than any Tax
imposed by law solely on Buyer or Great Nordic, if any;
(c) except to the extent provided in Article 9, any
liabilities or obligations relating to employee benefits or compensation
arrangements existing on or prior to the Closing Date, including, without
limitation, any liabilities or obligations under any of Seller's employee
benefit agreements, plans or other arrangements listed on Schedule 9.02;
(d) any Environmental Liability;
(e) any obligations under any agreements or understandings
(written or oral) with directors, officers or employees of the Seller or
Dynatech, except as set forth in Section 2.03(c) hereof; and
(f) any liability or obligation relating to an Excluded Asset.
SECTION 2.05. ASSIGNMENT OF CONTRACTS AND RIGHTS. Anything in this
Agreement to the contrary notwithstanding, this Agreement shall not constitute
an agreement to assign any Purchased Asset or any claim or right or any benefit
arising thereunder or resulting therefrom if an attempted assignment thereof,
without the consent of a third party thereto, would constitute a breach or
other contravention thereof or in any way adversely affect the rights of Buyer
or Seller thereunder. Seller and Buyer will use their best efforts (but
without any payment
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of money by Seller or Buyer) to obtain the consent of the other parties to any
such Purchased Asset or any claim or right or any benefit arising thereunder
for the assignment thereof to Buyer as Buyer may request. If such consent is
not obtained, or if an attempted assignment thereof would be ineffective or
would adversely affect the rights of Seller thereunder so that Buyer would not
in fact receive all such rights, Seller and Buyer will cooperate in a mutually
agreeable arrangement under which Buyer would obtain the benefits and assume
the obligations thereunder in accordance with this Agreement, including sub-
contracting, sub-licensing, or sub-leasing to Buyer, or under which Seller
would enforce for the benefit of Buyer, with Buyer assuming Seller's
obligations, any and all rights of Seller against a third party thereto.
Seller will promptly pay to Buyer when received all monies received by Seller
under any Purchased Asset or any claim or right or any benefit arising
thereunder, except to the extent the same represents an Excluded Asset. In such
event, Seller and Buyer shall, to the extent the benefits therefrom and
obligations thereunder have not been provided by alternate arrangements
satisfactory to Buyer and Seller, negotiate in good faith an adjustment in the
consideration paid by Buyer for the Purchased Assets, to the extent not
otherwise adjusted pursuant to Section 2.09.
SECTION 2.06 PURCHASE PRICE; ALLOCATION OF PURCHASE PRICE. (a) The
purchase price for the Purchased Assets (the "PURCHASE PRICE") is $25,700,000
in cash, subject to adjustment as provided in Section 2.09. The Purchase Price
shall be paid as provided in Section 2.07. All parties to this Agreement agree
that the Purchase Price allocation shall be as set forth in Schedule 2.06 (the
"Allocation Statement").
(b) Any adjustment made with respect to the Purchase Price pursuant to
Section 2.09 of this Agreement shall be allocated in accordance with the
determination mutually agreed by Seller and Buyer. In the event that an
agreement is not reached within 5 days after the determination of Final Net
Worth pursuant to Section 2.09(a), the disputed item(s) shall be resolved by
Deloitte & Touche LLP, or if such firm declines to act in such capacity, by
such other firm of independent nationally recognized accountants chosen and
mutually accepted by both parties (the "ACCOUNTING REFEREE"). The Accounting
Referee shall resolve the dispute within 30 days of having the item referred to
it. The costs, fees and expenses of the Accounting Referee shall be borne
equally by Seller and Buyer.
(c) Seller and Buyer agree to (i) be bound by the Allocation
Statement, (ii) report an allocation of such Purchase Price among the Purchased
Assets in a manner entirely consistent with the Allocation Statement,
(including any adjustment made pursuant to Section 2.06(b) hereof), and agree
to act in accordance with such Allocation Statement in the preparation of
financial statements and filing of all Tax returns (including, without
limitation, filing Form
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8594 with its Federal income tax return for the taxable year that includes the
date of the Closing) and in the course of any Tax audit, Tax review or Tax
litigation relating thereto and (iii) take no position and cause their
Affiliates to take no position inconsistent with the Allocation for federal and
state income Tax purposes.
(d) Each party agrees to file a Form 8594 relating to this transaction
in a manner consistent with the Allocation Statement.
SECTION 2.07. CLOSING. The closing (the "CLOSING") of the purchase and
sale of the Purchased Assets and the assumption of the Assumed Liabilities
hereunder is taking place at the offices of Hale and Dorr in Boston,
Massachusetts. At the Closing,
(a) Buyer is delivering to Seller $25,700,000 in immediately available
funds by wire transfer to an account previously designated by the Seller or
Dynatech.
(b) Seller and Buyer are entering into an Assignment and Assumption
Agreement substantially in the form attached hereto as Exhibit B, and Seller
shall deliver to Buyer a Bill of Sale (substantially in the form of Exhibit C),
endorsements, consents, assignments and other good and sufficient instruments
of conveyance and assignment (the "CONVEYANCE DOCUMENTS") as the parties and
their respective counsel shall deem reasonably necessary or appropriate to vest
in Buyer all right, title and interest in, to and under the Purchased Assets.
(c) Dynatech and Buyer are entering into a sub-lease agreement for the
part of the building at 77 Northeastern Boulevard, Nashua, New Hampshire
currently occupied by the Seller having terms substantially identical to the
terms of Seller's lease for such premises.
SECTION 2.08. CLOSING BALANCE SHEET. (a) At the Closing, Seller will
deliver to Buyer an unaudited balance sheet (the "ESTIMATED BALANCE SHEET").
The Estimated Balance Sheet shall be prepared in accordance with Dynatech's
standard accounting policy for its consolidated operations, which policy
conforms with generally accepted accounting principles, applied consistently
during the period covered thereby.
(b) As promptly as practicable, but no later than 45 days after the
Closing Date, Buyer will cause the Closing Balance Sheet to be prepared and
delivered to Seller together with an unqualified report of KPMG Peat Marwick
LLP thereon, and a certificate based on such Closing Balance Sheet setting
forth Buyer's calculation of Closing Net Working Capital. The Closing Balance
Sheet shall (i)
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fairly present in all material respects the consolidated financial position of
the Business as at the close of business on the Closing Date and shall have
been prepared consistent with the preparation of the Balance Sheet, in
accordance with Dynatech's standard accounting policy for its consolidated
operations, which policy conforms with generally accepted accounting
principles, (ii) include line items substantially consistent with those in the
Balance Sheet, and (iii) be prepared in accordance with accounting policies and
practices consistent with those used in the preparation of the Balance Sheet.
(c) If Seller disagrees with Buyer's calculation of Closing Net
Working Capital delivered pursuant to Section 2.08(b), Seller may, within 30
days after delivery of the documents referred to in Section 2.08(b), deliver a
notice to Buyer disagreeing with such calculation and setting forth Seller's
calculation of such amount. Any such notice of disagreement shall specify
those items or amounts as to which Seller disagrees, and Seller shall be deemed
to have agreed with all other items and amounts contained in the Closing
Balance Sheet and the calculation of Closing Net Working Capital delivered
pursuant to Section 2.08(b).
(d) If a notice of disagreement shall be duly delivered pursuant to
Section 2.08(c), Buyer and Seller shall, during the 15 days following such
delivery, use their best efforts to reach agreement on the disputed items or
amounts in order to determine, as may be required, the amount of Closing Net
Working Capital, which amount shall not be less than the amount thereof shown
in Buyer's calculations delivered pursuant to Section 2.08(b) nor more than the
amount thereof shown in Seller's calculation delivered pursuant to Section
2.08(c). If during such period, Buyer and Seller are unable to reach such
agreement, they shall promptly thereafter cause the Accounting Referee promptly
to review this Agreement and the disputed items or amounts for the purpose of
calculating Closing Net Working Capital. In making such calculation, the
Accounting Referee shall consider only those items or amounts in the Closing
Balance Sheet or Buyer's calculation of Closing Net Working Capital as to which
Seller has disagreed. The Accounting Referee shall deliver to Seller and
Buyer, as promptly as practicable, a report setting forth such calculation.
Such report shall be final and binding upon the parties hereto. The cost of
such review and report shall be borne (i) by Buyer if the difference between
Final Net Working Capital and Closing Net Working Capital as set forth in
Buyer's calculation of Closing Net Working Capital delivered pursuant to
Section 2.08(b) is greater than the difference between Final Net Working
Capital and Closing Net Working Capital as set forth in Seller's calculation of
Closing Net Working Capital delivered pursuant to Section 2.08(c), (ii) by
Seller if the first such difference is less than the second such difference and
(iii) otherwise equally by Seller and Buyer.
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(e) Buyer and Seller agree that they will, and agree to cause their
respective independent accountants to, cooperate and assist in the preparation
of the Closing Balance Sheet and the calculation of Closing Net Working Capital
and in the conduct of the audits and reviews referred to in this Section 2.08,
including without limitation, the making available to the extent necessary of
books, records, work papers and personnel.
SECTION 2.09. ADJUSTMENT OF PURCHASE PRICE. (a) If Base Net Working Capital
exceeds Final Net Working Capital by more than $200,000, Dynatech shall pay to
Buyer, as an adjustment to the Purchase Price, in the manner and with interest
as provided in Section 2.09(b), the amount by which Base Net Working Capital
exceeds Final Net Working Capital. If Final Net Working Capital exceeds Base
Net Working Capital by more than $200,000, Buyer shall pay to Seller, in the
manner and with interest as provided in Section 2.09(b), the amount by which
Final Net Working Capital exceeds Base Net Working Capital. Any such payment
pursuant to this Section 2.09(a) shall be made at a mutually convenient time
and place within 10 days after Final Net Working Capital has been determined.
(b) Method of Payment. Any payments pursuant to this Section 2.09 shall
be made by delivery by Buyer, or Seller, as the case may be, of a certified or
official bank check payable in immediately available funds to the other party
or by causing such payments to be credited to such account of such other party
as may be designated by such other party. The amount of any payment to be made
pursuant to this Section 2.09 shall bear interest from and including the
Closing Date to but excluding the date of payment at a rate per annum equal to
the rate publicly announced in the Wall Street Journal as the prime rate in
effect on the Closing Date. Such interest shall be payable at the same time as
the payment to which it relates and shall be calculated daily on the basis of a
year of 365 days and the actual number of days elapsed.
SECTION 2.10. APPORTIONMENT. (a) Water and sewer use charges and real
property taxes for the then current tax period, shall be apportioned and
adjusted as of the Closing Date and the net amount thereof shall be added to or
deducted from, as the case may be, the Purchase Price.
(b) If the amount of said real property taxes has not been determined
at the Closing Date, they shall be apportioned on the basis of such taxes
assessed for the preceding year, with a reapportionment as soon as the new tax
rate and valuation can be ascertained; and, if the taxes which are to
apportioned shall thereafter be reduced by abatement, the amount of such
abatement, less the reasonable cost of obtaining the same, shall be apportioned
between the parties, provided that neither party shall be obligated to
institute or prosecute proceedings for an abatement unless otherwise agreed.
If such proceedings are commenced,
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the party commencing the same shall give the other party notice thereof and
shall prosecute such proceedings and not discontinue the same without first
giving the other party notice of its intention so to do and reasonable
opportunity to be substituted in such proceedings; and the other party agrees
to cooperate in such proceedings without being obligated to incur any expense
in connection therewith.
ARTICLE 3
REPRESENTATIONS AND WARRANTIES OF DYNATECH AND SELLER
Dynatech and the Seller, jointly and severally, represent and warrant to
Buyer and Great Nordic as of the date hereof that:
SECTION 3.01. CORPORATE EXISTENCE AND POWER. The Seller is a corporation
duly incorporated, validly existing and in good standing under the laws of its
jurisdiction of incorporation, and has all corporate powers and all material
governmental licenses, authorizations, permits, consents and approvals required
to carry on its business as now conducted. Dynatech is a corporation duly
incorporated, validly existing and in good standing under the laws of its
jurisdiction of incorporation. Seller is duly qualified to do business as a
foreign corporation and is in good standing in each jurisdiction where such
qualification is necessary, except for those jurisdictions where failure to be
so qualified would not, individually or in the aggregate, have a Material
Adverse Effect. Seller has heretofore delivered to Buyer true and complete
copies of the Articles of Organization and bylaws of Seller as currently in
effect. The beneficial and record owner of all of the issued and outstanding
shares of Seller is Dynatech USA, Inc., a wholly-owned subsidiary of Dynatech.
SECTION 3.02. SUBSIDIARIES. Seller has no subsidiaries. Seller does not
own or have any interest in any corporation, partnership or joint venture
except as set forth in Schedule 3.02.
SECTION 3.03. CORPORATE AUTHORIZATION. The execution, delivery and
performance by Dynatech and the Seller of this Agreement are within each of
such company's corporate powers and have been duly authorized by all necessary
corporate action on their part. This Agreement constitutes a valid and binding
agreement of each of Dynatech and the Seller.
SECTION 3.04. GOVERNMENTAL AUTHORIZATION. The execution, delivery and
performance by each of Dynatech and the Seller of this Agreement require no
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action by or in respect of, or filing with, any governmental body, agency or
official other than compliance with any applicable requirements of the HSR Act.
SECTION 3.05. NON-CONTRAVENTION. The execution, delivery and performance
by Dynatech and the Seller of this Agreement do not and will not (a) violate
the certificate of incorporation or bylaws of Dynatech or the Seller, (b)
assuming compliance with the matters referred to in Section 3.04, violate any
applicable law, rule, regulation, judgment, injunction, order or decree; (c)
assuming the obtaining of all Required and Other Consents, constitute a default
under or give rise to any right of termination, cancellation or acceleration of
any right or obligation of Buyer or to a loss of any benefit relating to the
Business to which Seller is entitled under any provision of any agreement,
contract or other instrument binding upon Dynatech or the Seller or by which
any of the Purchased Assets is or may be bound or any Permit or (d) result in
the creation or imposition of any Lien on any Purchased Asset, other than
Permitted Liens.
SECTION 3.06. FINDERS' FEES. Except for The Bridgeford Group, whose fees
will be paid by Seller and/or Dynatech, there is no investment banker, broker,
finder or other intermediary which has been retained by or is authorized to act
on behalf of Seller and/or Dynatech who might be entitled to any fee or
commission in connection with the transactions contemplated by this Agreement.
SECTION 3.07. PROPERTIES. (a) Schedule 3.07(a) correctly describes all
real property used in the Business included in the Purchased Assets (the "REAL
PROPERTY"), which Seller owns, leases or subleases, any title insurance
policies and surveys with respect thereto, and any Liens thereon. True and
correct copies of leases or subleases have been delivered to the Buyer.
(b) Schedule 3.07(b) correctly describes all personal property used in
the Business included in the Purchased Assets, including but not limited to
machinery, equipment, furniture, leasehold improvements, vehicles and other
trade fixtures and fixed assets, which Seller owns, leases or subleases, and
any Liens thereon. True and correct copies of subleases have been delivered to
the Buyer.
(c)(i) Seller has good and marketable, indefeasible, fee simple title
(subject only to Permitted Liens) to, or in the case of leased Real Property
has valid leasehold interests in, all Purchased Assets (whether personal,
tangible or intangible) reflected on the Balance Sheet or acquired after the
Balance Sheet Date, except for assets sold since the Balance Sheet Date in the
ordinary course of business consistent with past practices.
(ii) The Real Property includes all real property, and only
such real property, as is used or held for use in connection with the
conduct of
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the business and operations of the Business as heretofore conducted and as
presently planned to be conducted by Buyer.
(iii) All leases of Real Property or personal property are in
good standing and are valid, binding and enforceable against Seller in
accordance with their respective terms, and there does not exist under any
such lease of real property or personal property any material default on
the part of Seller or any event which with notice or lapse of time or both
would constitute a material default on the part of Seller.
(iv) The equipment included in the Purchased Assets is in good
operating condition and repair and has been reasonably maintained
consistent with standards generally followed in the industry (giving due
account to the age and length of use of same, ordinary wear and tear
excepted) and is suitable for its present uses.
(d) No Purchased Asset is subject to any Lien, except:
(i) Liens disclosed on the Balance Sheet;
(ii) Liens for taxes not yet due or being contested in good
faith (and for which adequate accruals or reserves have been established on
the Balance Sheet); or
(iii) Liens which do not materially detract from the value of
such Purchased Asset as now used, or materially interfere with any present
use of such Purchased Asset (clauses (i), (ii) and (iii) are, collectively,
the "PERMITTED LIENS")
(e) No violation of any law, regulation or ordinance (including,
without limitation, laws, regulations or ordinances relating to zoning,
environmental, city planning or similar matters) relating to the Business or
any Purchased Asset currently exists or has existed at any time since June 30,
1993, except for violations which have not had and would not reasonably be
expected to have, individually or in the aggregate, a Material Adverse Effect.
To the knowledge of Seller, there are no developments affecting any of the
Purchased Assets pending or, to the knowledge of Seller threatened, which would
reasonably be expected to materially detract from the value of such Purchased
Assets, materially interfere with any present use of any such Purchased Assets
or materially adversely affect the marketability of such Purchased Assets.
SECTION 3.08. SUFFICIENCY OF AND TITLE TO THE PURCHASED ASSETS. (a) The
Purchased Assets constitute, and on the Closing Date will constitute, all of
the
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assets or property including without limitation all trademarks, service marks,
trade names, inventions, patents, trade secrets, know-hows, copyrights, or
other similar type of proprietary intellectual property rights, used or held
for use in the Business, other than Excluded Assets.
(b) Upon consummation of the transactions contemplated hereby, Buyer
will have acquired good and marketable title in and to, or a valid leasehold
interest in, each of the Purchased Assets, free and clear of all Liens, except
for Permitted Liens.
SECTION 3.09. FINANCIAL STATEMENTS. The Balance Sheet and the related
unaudited statements of operations for the Business taken as a whole for the
three months ended June 30, 1996 (collectively, the "FINANCIAL STATEMENTS") of
the Business have been prepared in accordance with Dynatech's standard
accounting policy for its consolidated operations, which policy conforms with
generally accepted accounting principles applied consistently during the period
covered thereby and present fairly in all material respects the financial
condition of Seller at the date of said statement and the results of operations
for the period covered thereby; provided however, that none of the financial
statements have footnotes required under generally accepted accounting
principles.
SECTION 3.10. ACCOUNTS RECEIVABLE. All of the accounts receivable of the
Seller have arisen in the ordinary course of the Seller's business. Schedule
3.10 sets forth the amounts receivable of Seller and aging information with
respect to such accounts receivable.
SECTION 3.11. ABSENCE OF CERTAIN CHANGES. Except as set forth in Schedule
3.11, since the Balance Sheet Date, the Business has been conducted in the
ordinary course consistent with past practices, and there has not been:
(a) any event, occurrence, development or state of
circumstances or facts which has had or would reasonably be expected to
have a Material Adverse Change;
(b) any incurrence, assumption or guarantee by Seller of any
indebtedness for borrowed money with respect to the Business other than in
the ordinary course of business and in amounts and on terms consistent with
past practices, but in any event not exceeding $50,000;
(c) any creation or other incurrence of any Lien on any
material Purchased Asset other than in the ordinary course of business
consistent with past practices other than a Permitted Lien;
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(d) any damage, destruction or other casualty loss (whether or
not covered by insurance) affecting the Business or any Purchased Asset
which, individually or in the aggregate, has had or would reasonably be
expected to have a Material Adverse Effect;
(e) any transaction or commitment made, or any contract or
agreement entered into, by Seller relating to the Business or any Purchased
Asset (including the acquisition or disposition of any assets) or any
relinquishment by Seller of any contract or other right, in either case,
material to the Business taken as a whole, other than transactions and
commitments in the ordinary course of business consistent with past
practices and those contemplated by this Agreement;
(f) any change in any method of accounting or accounting
practice by Seller with respect to the Business, except for any such change
after the date hereof required by reason of a concurrent change in
generally accepted accounting principles;
(g) any (i) employment, deferred compensation, severance,
retirement or other similar agreement entered into with any employee of the
Business (or any amendment to any such existing agreement), (ii) grant of
any severance or termination pay to any such employee or (iii) change in
compensation or other benefits payable to any such employee pursuant to any
severance or retirement plans or policies, other than in the ordinary
course of business consistent with past practice or except in connection
with the transactions contemplated by this Agreement;
(h) any labor dispute, other than routine individual
grievances, or any activity or proceeding by a labor union or
representative thereof to organize any employees of the Business, or any
lockouts, strikes, slowdowns, work stoppages or threats thereof by or with
respect to such employees; or
(i) any capital expenditure, or commitment for a capital
expenditure, for additions or improvements to property, plant and equipment
in excess of $25,000.
SECTION 3.12. REQUIRED AND OTHER CONSENTS. (a) Schedule 3.12(a) sets forth
each agreement, contract or other instrument binding upon Seller or any Permit
requiring a consent as a result of the execution, delivery and performance of
this Agreement, except such consents as would not, individually or in the
aggregate, have a Material Adverse Effect if not received by the Closing Date
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(each such consent, a "REQUIRED CONSENT" and together the "REQUIRED CONSENTS").
(b) Schedule 3.12(b) sets forth every other consent (each such
consent, an "OTHER CONSENT" and together the "OTHER CONSENTS") under such
agreements, contracts or other instruments or such Permits that is necessary
with respect to the execution, delivery and performance of this Agreement.
SECTION 3.13. INTELLECTUAL PROPERTY. (a) Schedule 3.13 sets forth a list of
all trademarks, service marks, trade names, patents, copyrights (including any
registration or application relating to any of the foregoing) included in the
Intellectual Property Rights, specifying as to each, as applicable: (i) the
nature of such Intellectual Property Right; (ii) the owner of such Intellectual
Property Right; (iii) the jurisdictions by or in which such Intellectual
Property Right has been issued or registered or in which an application for
such issuance or registration has been filed, including the respective
registration or application numbers; and (iv) licenses, sublicenses and other
agreements as to which Seller or any of its Affiliates is a party and pursuant
to which any Person is authorized to use such Intellectual Property Right,
including the identity of all parties thereto, a description of the nature and
subject matter thereof, the applicable royalty and the term thereof.
(b)(i) Except as set forth in Schedule 3.13, Seller has not during the
three years preceding the date of this Agreement been a defendant in any
action, suit, investigation or proceeding relating to, or otherwise has been
notified of, any alleged claim or infringement of any patents, trademarks,
service marks or copyrights, and Seller has no knowledge of any other claim or
infringement by Seller, and (ii) Seller has no knowledge of any continuing
infringement by any other Person of any Intellectual Property Rights. No
Intellectual Property Right is subject to any outstanding judgment, injunction,
order, decree or agreement restricting the use thereof by Seller with respect
to the Business or restricting the licensing thereof by Seller to any Person.
Seller has not entered into any agreement to indemnify any other Person against
any charge of infringement of any patent, trademark, service mark or copyright.
SECTION 3.14. LITIGATION. Except as set forth in Schedule 3.14, there is
no action, suit, investigation or proceeding pending against, or to the
knowledge of Seller, threatened against or affecting, the Business or any
Purchased Asset before any court or arbitrator or any governmental body, agency
or official which, if determined or resolved adversely in accordance with the
plaintiff's demands, could reasonably be expected to have a Material Adverse
Effect or which in any manner challenges or seeks to prevent, enjoin, alter or
materially delay the transactions contemplated hereby.
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SECTION 3.15. INSURANCE COVERAGE. Schedule 3.15 sets forth a summary of
all insurance policies and fidelity bonds relating to the Purchased Assets, the
business and operations of the Business and its employees. There is no claim
by Seller pending under any of such policies or bonds as to which coverage has
been questioned, denied or disputed by the underwriters of such policies or
bonds or in respect of which such underwriters have reserved their rights.
Such policies of insurance and bonds (or other policies and bonds providing
substantially similar insurance coverage) have been in effect since June 30,
1993 and remain in full force and effect. Such policies and bonds are of the
type and in amounts customarily carried by Persons conducting businesses
similar to the Business. Except as disclosed in Schedule 3.15, after the
Closing Seller shall continue to have coverage under such policies and bonds
with respect to events occurring prior to Closing.
SECTION 3.16. ENVIRONMENTAL COMPLIANCE. (a) Except as disclosed on
Schedule 3.16:
(i) in connection with or relating to the Purchased Assets,
Business or Real Property or any other property or assets now or previously
owned, leased or operated by Seller, no notice, notification, demand,
request for information, citation, summons or order has been issued, no
complaint has been filed, no penalty has been assessed and, to Seller's
knowledge, no investigation or review is pending or threatened by any
governmental or other Person with respect to any matters arising out of or
relating to any Environmental Law; and
(ii) to the knowledge of the Seller, no Real Property nor any
other property now or previously owned, leased or operated by Seller nor
any property to which Hazardous Substances located on or resulting from the
use of any Purchased Asset have been transported is listed or, proposed for
listing on the National Priorities List promulgated pursuant to CERCLA, on
CERCLIS (as defined in CERCLA) or on any similar federal, state, local or
foreign list of sites requiring investigation or cleanup;
(iii) there are no Environmental Permits that are
nontransferable or require consent, notification or other action to remain
in full force and effect following the consummation of the transactions
contemplated hereby.
(b) There has been no environmental investigation, study, audit, test,
review or other analysis conducted of which Seller has knowledge in relation to
any Purchased Asset or Real Property or any other property or facility now or
previously owned or leased by Seller which has not been delivered to Buyer at
least five days prior to the date hereof. The parties acknowledge that a Phase
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Environmental study was conducted during October 1994 and updated by Buyer
during September 1996.
(c) None of the Purchased Assets or the Real Property is located in New
Jersey or Connecticut.
(d) For purposes of this Section, the term "Seller" shall include any
entity which is, in whole or in part, a predecessor of Seller.
SECTION 3.17. LICENSES AND PERMITS. Schedule 3.17 correctly describes each
license, franchise, permit or other similar authorization affecting, or
relating in any way to, the Business, together with the name of the government
agency or entity issuing such license or permit (the "PERMITS"). Except as set
forth on the Schedule 3.17, such Permits are valid and in full force and effect
and, assuming the related Required Consents and Other Consents have been
obtained prior to the Closing Date, are transferable by Seller, and none of the
Permits will, assuming the related Required Consents and Other Consents have
been obtained prior to the Closing Date, be terminated as a result of the
transactions contemplated hereby. Upon consummation of such transactions, Buyer
will, assuming the related Required Consents and Other Consents have been
obtained prior to the Closing Date, have all of the right, title and interest
in all the Permits currently held by Seller.
SECTION 3.18. CUSTOMERS AND DISTRIBUTORS. Schedule 3.18 sets forth any
sales representative, distributor or direct customer (whether pursuant to a
commission, royalty or other arrangement) who accounted for more than 10% of
the sales of Seller for the three months ended June 30, 1996.
SECTION 3.19. TRANSACTIONS WITH AFFILIATES. Except as set forth in
Schedule 3.19, Seller does not own, and, to Seller's knowledge, none of
Seller's stockholders, officers or directors own directly or indirectly on an
individual or joint basis any interest in (other than passive investments of
less than 5% of the equity ownership of a publicly traded enterprise), or serve
as an officer or director or in another similar capacity of, any competitor or
supplier of Seller, or, to the knowledge of Seller, any organization which has
a contract or arrangement with Seller. Except as set forth in Schedule 3.19,
Seller is not and, during the twelve-month period preceding the date hereof,
has not been a party to any material sales or purchase contract or transaction
with any affiliate of Dynatech.
SECTION 3.20. INVENTORIES. All of the Seller's inventory items (net of any
reserve therefor identified in the Balance Sheet) are of a quality and quantity
usable in the ordinary course of business. The values of the inventories
stated in
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the Balance Sheet reflect the normal inventory valuation policies of the Seller
and were determined in accordance with generally accepted accounting policies.
SECTION 3.21. MATERIAL CONTRACTS. (a) Except for the Contracts disclosed in
Schedule 3.21 or any other schedule to this Agreement, with respect to the
Business, Seller is not a party to or bound by:
(i) any lease (whether of real or personal property)
providing for annual rentals of $50,000 or more;
(ii) any agreement for the purchase of materials, supplies,
goods, services, equipment or other assets providing for either
(A) annual payments by Seller of $50,000 or more or (B) aggregate
payments by Seller of $50,000 or more;
(iii) any sales, distribution or other similar agreement
providing for the sale by Seller of materials, supplies, goods,
services, equipment or other assets that provides for either (A)
annual payments to Seller of $50,000 or more or (B) aggregate
payments to Seller of $50,000 or more;
(iv) any partnership, joint venture or other similar
agreement or arrangement;
(v) any agreement relating to indebtedness for borrowed money
or the deferred purchase price of property (in either case,
whether incurred, assumed, guaranteed or secured by any asset),
except any such agreement with an aggregate outstanding principal
amount not exceeding $50,000 and which may be prepaid on not more
than 30 days notice without the payment of any penalty;
(vi) any option, license, franchise or similar agreement,
except in the ordinary course of business;
(vii) any agency, dealer, sales representative, marketing or
other similar agreement;
(viii) any agreement that limits the freedom of Seller to
compete in any line of business or with any Person or in any area
or to own, operate, sell, transfer, pledge or otherwise dispose of
or encumber any Purchased Asset or which would so limit the
freedom of Buyer after the Closing Date;
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(ix) any agreement with or for the benefit of any Affiliate
of Seller; or
(x) any other agreement, commitment, arrangement or plan not
made in the ordinary course of business which is material to the
Business taken as a whole.
(b) Each Contract disclosed in any schedule to this Agreement or required
to be disclosed pursuant to this Section is a valid and binding agreement of
Seller and is in full force and effect, and neither Seller nor, to the
knowledge of Seller, any other party thereto is in default or breach in any
material respect under the terms of any such Contract, nor, to the knowledge of
Seller, has any event or circumstance occurred that, with notice or lapse of
time or both, would constitute any event of default thereunder. True and
complete copies of each such contract have been delivered to Buyer.
SECTION 3.22. COMPLIANCE WITH LAWS AND COURT ORDERS. Seller is not in
violation of, has not since June 30, 1993 violated, and to Seller's knowledge
is not under investigation with respect to or has not been threatened to be
charged with or given notice of any violation of, any law, rule, regulation,
judgment, injunction, order or decree applicable to the Purchased Assets or the
conduct of the Business, except for violations that have not had and would not
reasonably be expected to have, individually or in the aggregate, a Material
Adverse Effect.
SECTION 3.23. EMPLOYEES. Schedule 3.23 sets forth a true and complete list
of (a) the names, titles, annual salaries and other compensation of all
employees of the Business whose annual base salary exceeds $100,000 and (b) the
wage rates for non-salaried employees of the Business (by classification). To
the knowledge of Seller, no employee of the Business intends to resign or
retire as a result of the transactions contemplated by this Agreement or
otherwise within one year after the Closing Date.
SECTION 3.24. PRODUCTS. Each of the products produced or sold by Seller in
connection with the Business (a) is, and at all times up to and including the
sale thereof has been, in compliance in all material respects with all
applicable federal, state, local and foreign laws and regulations and (b) is,
and at all relevant times has been, fit for the ordinary purposes for which it
is intended to be used and conforms in all material respects to any promises or
affirmations of fact made on the container or label for such product or in
connection with its sale. To the knowledge of Seller, there is no design
defect with respect to any of such products, and each of such products contains
adequate warnings, presented in a reasonably prominent manner, in accordance
with applicable laws, rules and regulations and current industry practice with
respect to its contents and use.
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SECTION 3.25. NO UNDISCLOSED MATERIAL LIABILITIES To the knowledge of the
Seller, there are no liabilities of the Business of any kind whatsoever,
whether accrued, contingent, absolute, determined, determinable or otherwise,
and there is no existing condition, situation or set of circumstances which
would reasonably be expected to result in such a liability, other than:
(a) liabilities provided for in the Balance Sheet, disclosed in
the notes thereto, referred to in Section 2.03(c), or any future obligation
to perform Contracts to be assumed pursuant to Section 2.03(b); and
(b) other undisclosed liabilities which, individually or in the
aggregate are not material to the Business, taken as a whole.
SECTION 3.26. DISCLAIMER. EXCEPT FOR THE REPRESENTATIONS AND WARRANTIES OF
SELLER AND DYNATECH CONTAINED HEREIN, SELLER AND DYNATECH DISCLAIM ALL
WARRANTIES, EXPRESS, IMPLIED OR STATUTORY, INCLUDING WITHOUT LIMITATION, ANY
WARRANTY OF MERCHANTABILITY OR FITNESS FOR A PARTICULAR USE OR PURPOSE.
SECTION 3.27. DEFINITION OF KNOWLEDGE. In each case where a representation
or warranty by Seller contained in this Agreement is qualified as being "to
Seller's knowledge" (or otherwise similarly qualified), such knowledge shall be
deemed to consist solely of the knowledge of Michael Fairweather, President,
George Taylor, Chief Financial Officer, R. Levasseur, Controller, T. Dennis,
Director R&D of Seller, Sam Tishler, Director of Business Development, David
Morrissette, Business Development, Finance Manager, and Robert Apprich,
Manager, Internal Audit Group, of Dynatech, in each case after reasonable
investigation. With respect to the knowledge of such persons, Seller shall be
entitled to rely solely on its receipt of a written certificate from such
persons.
ARTICLE 4
REPRESENTATIONS AND WARRANTIES OF BUYER AND GREAT NORDIC
Buyer and Great Nordic, jointly and severally, warrant to Seller and
Dynatech as of the date hereof that:
SECTION 4.01. ORGANIZATION AND EXISTENCE. Buyer is a corporation duly
incorporated, validly existing and in good standing under the laws of the State
of Delaware and has all corporate powers and all material governmental
licenses, authorizations, permits, consents and approvals required to carry on
its business as now conducted. Great Nordic is a corporation duly incorporated
and validly
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existing under the laws of its jurisdiction of incorporation. Buyer is duly
qualified to do business as a foreign corporation and is in good standing in
each jurisdiction in which qualification is necessary, except for those
jurisdictions where failure to be so qualified would not, individually or in
the aggregate, have a material adverse effect on the business, assets,
condition (financial or otherwise) or results of operations of Buyer.
SECTION 4.02. CORPORATE AUTHORIZATION. The execution, delivery and
performance by Buyer and Great Nordic of this Agreement are within the
corporate powers of Buyer and Great Nordic and have been duly authorized by all
necessary corporate action on the part of Buyer and Great Nordic. This
Agreement constitutes a valid and binding agreement of Buyer and Great Nordic.
SECTION 4.03. GOVERNMENTAL AUTHORIZATION. The execution, delivery and
performance by each of Buyer and Great Nordic of this Agreement require no
action by or in respect of, or filing with, any governmental body, agency or
official other than (a) compliance with any applicable requirements of the HSR
Act.
SECTION 4.04. NON-CONTRAVENTION. The execution, delivery and performance by
Buyer and Great Nordic of this Agreement do not and will not (a) violate the
certificate of incorporation or bylaws (or similar documents) of Buyer or Great
Nordic or (b) assuming compliance with the matters referred to in Section 4.03,
violate any applicable law, rule, regulation, judgment, injunction, order or
decree or (c) constitute a default under or give rise to any right of
termination, cancellation or acceleration of any right or obligation of Buyer
or Great Nordic relating to this Agreement or require any consent under any
agreement or contract binding on Buyer or Great Nordic.
SECTION 4.05. LITIGATION. There is no action, suit, investigation or
proceeding pending against, or to the knowledge of Buyer threatened against or
affecting, Buyer before any court or arbitrator or any governmental body,
agency or official which in any manner challenges or seeks to prevent, enjoin,
alter or materially delay the transactions contemplated hereby.
SECTION 4.06. FINDERS' FEES. There is no investment banker, broker, finder
or other intermediary which has been retained by or is authorized to act on
behalf of Buyer who might be entitled to any fee or commission from Seller or
any of its Affiliates upon consummation of the transactions contemplated by
this Agreement.
SECTION 4.07. FINANCING. Buyer or Great Nordic have sufficient cash,
available lines of credit or other sources of immediately available funds to
enable
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Buyer to purchase the Purchased Assets and pay any other amounts to be paid by
Buyer hereunder.
ARTICLE 5
COVENANTS OF SELLER
Seller agrees that:
SECTION 5.01. CONFIDENTIALITY.
(a) After Closing, Seller and its Affiliates will hold, and will
use their best efforts to cause their respective officers, directors,
employees, accountants, counsel, consultants, advisors and agents to hold, in
confidence, unless compelled to disclose by judicial or administrative process
or by other requirements of law, all confidential documents and information
concerning the Business, except to the extent that such information can be
shown to have been (a) previously known on a nonconfidential basis by Seller,
(b) in the public domain through no fault of Seller or (c) later lawfully
acquired by Seller from sources other than those related to its prior ownership
of the Business. The obligation of Seller and its Affiliates to hold any such
information in confidence shall be satisfied if they exercise the same care
with respect to such information as they would take to preserve the
confidentiality of their own similar information.
(b) Each party agrees that it will cooperate with and make
available to the other party, during normal business hours, all books of
account and other financial records (including, without limitation,
accountant's work papers) pertaining to the Business ("BOOKS AND RECORDS"),
information and employees (without substantial disruption of employment)
retained and remaining in existence after the Closing Date which are necessary
or useful in connection with any inquiry relating to Taxes or any audit,
investigation or dispute, any ligation or investigation or any other matter
requiring any such Books and Records, information or employees for any
reasonable business purpose. The party requesting any such Books and Records,
information or employees shall bear all of the out-of-pocket costs and expenses
(including, without limitation, attorneys' fees, but excluding reimbursement
for general overhead, salaries and employee benefits) reasonably incurred in
connection with providing such Books and Records, information or employees.
The Seller may require certain financial information relating to the Business
for periods prior to the Closing Date for the purpose of filing federal, state,
local and foreign Tax Returns and other governmental reports, and the Buyer
agrees to furnish such information to the Seller at the Seller's request and
expense.
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SECTION 5.02. NOTICES OF CERTAIN EVENTS. Seller shall promptly notify Buyer
of:
(a) any notice or other communication from any Person
alleging that the consent of such Person is or may be required in
connection with the transactions contemplated by this Agreement;
(b) any notice or other communication from any governmental
or regulatory agency or authority in connection with the
transactions contemplated by this Agreement.
SECTION 5.03. NONCOMPETITION. (a) Dynatech and the Seller each agree that
for a period of five years from the Closing Date, neither of them nor any of
their Affiliates shall:
(i) engage, either directly or indirectly, as a principal or
for its own account or solely or jointly with others, or as
stockholders in any corporation or joint stock association (except
as the holder of not more than five percent (5%) of the total
outstanding stock of a publicly held company), in any business
that competes with the Business as it exists on the Closing Date,
provided that nothing herein shall prohibit the acquisition by
Seller or any of its Affiliates of a diversified company having
not more than 10% of its sales (based on its latest published
annual audited financial statements) attributable to any business
that competes with the Business; or
(ii) employ or solicit, or receive or accept the performance
of services by, any Transferred Employee, except for Transferred
Employees terminated by Buyer without cause.
(b) If any provision contained in this Section shall for any reason be
held invalid, illegal or unenforceable in any respect, such invalidity,
illegality or unenforceability shall not affect any other provisions of this
Section, but this Section shall be construed as if such invalid, illegal or
unenforceable provision had never been contained herein. It is the intention
of the parties that if any of the restrictions or covenants contained herein is
held to cover a geographic area or to be for a length of time which is not
permitted by applicable law, or in any way construed to be too broad or to any
extent invalid, such provision shall not be construed to be null, void and of
no effect, but to the extent such provision would be valid or enforceable under
applicable law, a court of competent jurisdiction shall construe and interpret
or reform this Section to provide for a covenant having the maximum enforceable
geographic area, time period and other provisions (not greater than those
contained herein) as shall be valid and enforceable under such
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applicable law. Seller acknowledges that Buyer would be irreparably harmed by
any breach of this Section and that there would be no adequate remedy at law or
in damages to compensate Buyer for any such breach. Seller agrees that Buyer
shall be entitled to injunctive relief requiring specific performance by Seller
of this Section, and Seller consents to the entry thereof.
SECTION 5.04. UNEX NAME. Promptly after Closing, Seller will amend its
articles of organization to change its name from "Unex Corporation" to another
name which does not use "UNEX".
ARTICLE 6
COVENANTS OF BUYER
Buyer agrees that:
SECTION 6.01. PROVISION OF FINANCIAL INFORMATION. Within sixty (60) days
after the Closing Date, Buyer shall provide Seller with such financial
information with respect to the business of Seller for the period from April 1,
1996 up to and including the Closing Date as identified on Schedule 6.01 or as
Seller or Dynatech may request for the purpose of allowing Seller and Dynatech
to prepare financial reporting information required by federal and state
securities and tax laws.
SECTION 6.02. MANAGEMENT SERVICES. Buyer will cooperate with Seller in
arranging that the individuals listed on Schedule 6.02 will devote not more
than a percentage of their working day for a number of days, in each case, as
reflected on Schedule 6.02, after the Closing Date working on matters for
certain of the Seller's affiliates; provided that such activity shall not
result in or aid Dynatech, the Seller or any of their Affiliates in any
activity that may result in a breach of Section 5.03. Buyer shall invoice
Seller or its relevant Affiliates for the management services provided pursuant
to this Section 6.02 on the same terms that Seller currently charges its
Affiliates for these services. Any such invoice shall be paid promptly after
receipt thereof and in any event within 30 days by Seller or the relevant
Affiliate.
ARTICLE 7
COVENANTS OF BOTH PARTIES
Buyer and Seller agree that:
SECTION 7.01. BEST EFFORTS; FURTHER ASSURANCES. (a) Subject to the terms and
conditions of this Agreement, Buyer and Seller will each use its best
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efforts to take, or cause to be taken, all actions and to do, or cause to be
done, all things necessary or desirable under applicable laws and regulations
to consummate the transactions contemplated by this Agreement. Seller and
Buyer each agree to execute and deliver such other documents, certificates,
agreements and other writings and to take such other actions as may be
necessary or desirable in order to consummate or implement expeditiously the
transactions contemplated by this Agreement and to vest in Buyer good and
marketable title to the Purchased Assets.
(b) Seller hereby constitutes and appoints, effective as of the Closing
Date, Buyer and its successors and assigns as the true and lawful attorney of
Seller with full power of substitution in the name of Buyer or in the name of
Seller, but for the benefit of Buyer (i) to collect for the account of Buyer
any items of Purchased Assets and (ii) to institute and prosecute all
proceedings which Buyer may in its sole discretion deem proper in order to
assert or enforce any right, title or interest in, to or under the Purchased
Assets, and to defend or compromise any and all actions, suits or proceedings
in respect of the Purchased Assets. Buyer shall be entitled to retain for its
own account any amounts collected pursuant to the foregoing powers, including
any amounts payable as interest in respect thereof.
SECTION 7.02. CERTAIN FILINGS. Seller and Buyer shall cooperate with one
another (a) in determining whether any action by or in respect of, or filing
with, any governmental body, agency, official or authority is required, or any
actions, consents, approvals or waivers are required to be obtained from
parties to any material contracts, in connection with the consummation of the
transactions contemplated by this Agreement and (b) in taking such actions or
making any such filings, furnishing information required in connection
therewith and seeking timely to obtain any such actions, consents, approvals or
waivers.
SECTION 7.03. PUBLIC ANNOUNCEMENTS. The parties agree to consult with each
other before issuing any press release or making any public statement with
respect to this Agreement or the transactions contemplated hereby and, except
as may be required by applicable law or any listing agreement with any national
securities exchange, will not issue any such press release or make any such
public statement prior to such consultation. Each of Buyer and Seller shall
consent in writing to the initial press release after Closing.
SECTION 7.04. WARN ACT. The parties agree to cooperate in good faith to
determine whether any notification may be required under the Worker Adjustment
and Retraining Notification Act (the "WARN ACT") as a result of the
transactions contemplated by this Agreement. Buyer will be responsible for
providing any notification that may be required under the WARN Act with respect
to any Transferred Employees. Seller will be responsible for providing any
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notification that may be required under the WARN Act with respect to any
employees of the Business that are not Transferred Employees.
ARTICLE 8
TAX MATTERS
SECTION 8.01. TAX DEFINITIONS. The following terms, as used herein, have the
following meanings:
"CODE" means the Internal Revenue Code of 1986, as amended.
"FINAL DETERMINATION" shall mean (i) with respect to Federal Taxes, a
"determination" as defined in Section 1313(a) of the Code or execution of an
Internal Revenue Service Form 870AD and, with respect to Taxes other than
Federal Taxes, any final determination of liability in respect of a Tax that,
under applicable law, is not subject to further appeal, review or modification
through proceedings or otherwise (including the expiration of a statute of
limitations or a period for the filing of claims for refunds, amended returns
or appeals from adverse determinations) or (ii) the payment of Tax by Buyer,
Seller or any of their Affiliates, whichever is responsible for payment of such
Tax under applicable law, with respect to any item disallowed or adjusted by a
taxing authority, provided that such responsible party determines that no
action should be taken to recoup such payment and the other party agrees.
"POST-CLOSING TAX PERIOD" means any Tax period (or portion thereof) ending
after the Closing Date.
"PRE-CLOSING TAX PERIOD" means any Tax period (or portion thereof) ending
on or before the close of business on the Closing Date.
"TAX" means any net income, alternative or add-on minimum tax, gross
income, gross receipts, sales, use, ad valorem, franchise, capital, paid-up
capital, profits, greenmail, license, withholding, payroll, employment, excise,
severance, stamp, occupation, premium, property, environmental or windfall
profit tax, custom, duty or other tax, governmental fee or other like
assessment or charge or any kind whatsoever, together with any interest or any
penalty, addition to tax or additional amount imposed by any governmental
authority (domestic or foreign) responsible for the imposition of any such tax,
(domestic or foreign), or (ii) liability for the payment of any amounts of the
type described in (i) as a result of being party to any agreement or any
express or implied obligation to indemnify any other Person.
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SECTION 8.02. TAX MATTERS. Dynatech and the Seller hereby represent and
warrant to Buyer that:
(a) Seller has timely paid all Taxes, and all interest and penalties due
thereon and payable by it for the Pre-Closing Tax Period which will have been
required to be paid on or prior to the Closing Date, the non-payment of which
would result in a Lien on any Purchased Asset, would otherwise adversely affect
the Business or would result in Buyer becoming liable or responsible therefor.
(b) Seller will timely pay all Tax liabilities, assessments, interest and
penalties which arise from or with respect to the Purchased Assets or the
operation of the Business and are incurred in or attributable to the
Pre-Closing Tax Period, the non-payment of which would result in a Lien on any
Purchased Asset, would otherwise adversely affect the Business or would result
in Buyer becoming liable therefor.
SECTION 8.03. TAX COOPERATION; ALLOCATION OF TAXES. (a) Buyer, Dynatech,
Great Nordic and Seller agree to furnish or cause to be furnished to each
other, upon request, as promptly as practicable, such information and
assistance relating to the Purchased Assets and the Business as is reasonably
necessary for the filing of all Tax returns, and making of any election related
to Taxes, the preparation for any audit by any taxing authority, and the
prosecution or defense of any claim, suit or proceeding relating to any Tax
return. Buyer and Seller shall retain all books and records with respect to
Taxes pertaining to the Assets for a period of at least six years following the
Closing Date. At the end of such period, each party shall provide the other
with at least ten days prior written notice before destroying any such books
and records, during which period the party receiving such notice can elect to
take possession, at its own expense, of such books and records. Seller and
Buyer shall cooperate with each other in the conduct of any audit or other
proceeding related to Taxes involving the Business.
(b) All personal property taxes and similar ad valorem obligations levied
with respect to the Purchased Assets for a taxable period which includes (but
does not end on) the Closing Date (collectively, the "APPORTIONED OBLIGATIONS")
shall be apportioned between Seller and Buyer as of the Closing Date based on
the number of days of such taxable period included in the Pre-Closing Tax
Period and the number of days of such taxable period included in the
Post-Closing Period. Seller shall be liable for the proportionate amount of
such taxes that is attributable to the Pre-Closing Tax Period, and Buyer shall
be liable for the proportionate amount of such taxes that is attributable to
the Post-Closing Tax Period. Within 90 days after the Closing, Seller and
Buyer shall present a statement to the other setting forth the amount of
reimbursement to which each is entitled under this Section 8.03(b) together
with such supporting evidence as is reasonably necessary
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to calculate the proration amount. The proration amount shall be paid by the
party owing it to the other within 10 days after delivery of such statement.
Thereafter, Seller shall notify Buyer upon receipt of any bill for personal
property taxes relating to the Purchased Assets, part or all of which are
attributable to the Post-Closing Tax Period, and shall promptly deliver such
bill to Buyer who shall pay the same to the appropriate taxing authority,
provided that if such bill covers the Pre-Closing Tax Period, Seller shall also
remit prior to the due date of assessment to Buyer payment for the
proportionate amount of such bill that is attributable to the Pre-Closing Tax
Period. In the event that either Seller or Buyer shall thereafter make a
payment for which it is entitled to reimbursement under this Section 8.03(b),
the other party shall make such reimbursement promptly but in no event later
than 30 days after the presentation of a statement setting forth the amount of
reimbursement to which the presenting party is entitled along with such
supporting evidence as is reasonably necessary to calculate the amount of
reimbursement. Any payment required under this Section and not made within 10
days of delivery of the statement shall bear interest at the rate per annum
determined, from time to time, under the provisions of Section 6621(a)(2) of
the Code for each day until paid.
(c) Any transfer, documentary, sales, use excise, value added,
registration, stamp, recording, documentary, conveyancing, franchise, property,
transfer, gains or similar Taxes, levies, charges and fees (collectively,
"TRANSFER TAXES") incurred in connection with the transactions contemplated by
this Agreement shall be borne equally by the Seller and the Buyer.
ARTICLE 9
EMPLOYEE BENEFITS
SECTION 9.01. EMPLOYEE BENEFITS DEFINITIONS. The following terms, as used
herein, having the following meanings:
"EMPLOYEE PLANS" means the plans referred to in the first sentence of
Section 9.02.
"ERISA" means the Employee Retirement Income Security Act of 1974, as
amended.
"ERISA AFFILIATE" of any entity means any other entity which, together with
such entity, would be treated as a single employer under Section 414 of the
Code.
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"MULTIEMPLOYER PLAN" means each Employee Plan that is a multiemployer plan,
as defined in Section 3(37) of ERISA.
SECTION 9.02. ERISA REPRESENTATIONS. Dynatech and the Seller hereby
represent and warrant to Buyer that:
(a) Schedule 9.02(a) lists each "EMPLOYEE BENEFIT PLAN", as such term is
defined in Section 3(3) of ERISA, which (i) is subject to any provision of
ERISA, (ii) is maintained, administered or contributed to by Seller or any of
its Affiliates (as defined below) and (iii) covers any employee of the Business
(hereinafter referred to collectively as the "EMPLOYEE PLANS"). With respect
to each Employee Plan, Seller has provided a true and complete copy of such
plan document, the most recently filed Form 5500 and an accurate summary
description of such plan. Seller has provided Buyer with, or has caused to be
provided to Buyer, complete actuarial data (including age, salary, service and
related data) as of the most recent practicable date for employees of the
Business.
(b) No Employee Plan is a Multiemployer Plan and no Employee Plan is
subject to Title IV of ERISA. Neither Seller nor any of Seller's Affiliates
has incurred any liability under Title IV of ERISA arising in connection with
the termination of any plan covered or previously covered by Title IV of ERISA
that could become, after the Closing Date, an obligation of Buyer or any of its
Affiliates.
(c) Each Employee Plan which is intended to be qualified under Section
401(a) of the Code is so qualified and has been so qualified during the period
from its adoption to date, and each trust forming a part thereof is exempt
from tax pursuant to Section 501(a) of the Code. Seller has furnished to Buyer
copies of the most recent Internal Revenue Service determination letters with
respect to each such Plan. Each Employee Plan has been maintained
substantially in compliance with its terms and with the requirements prescribed
by any and all statutes, orders, rules and regulations, including but not
limited to ERISA and the Code, which are applicable to such Plan.
(d) Schedule 9.02(d) includes a list of each employment, severance or other
similar contract, arrangement or policy (written or oral) and each plan or
arrangement (written or oral) providing for insurance coverage (including any
self-insured arrangements), workers' compensation, disability benefits,
supplemental unemployment benefits, vacation benefits, retirement benefits or
for deferred compensation, profit-sharing, bonuses, stock options, stock
appreciation or other forms of incentive compensation or post-retirement
insurance, compensation or benefits which (i) is not an Employee Plan, (ii) is
entered into, maintained or contributed to, as the case may be, by Seller or
any of its Affiliates
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and (iii) covers any U.S. employee of the Business. Such contracts, plans and
arrangements as are described above, copies or descriptions of all of which
have been made available or furnished previously to Buyer are hereinafter
referred to collectively as the "BENEFIT ARRANGEMENTS." Each Benefit
Arrangement has been maintained in substantial compliance with its terms and
with the requirements prescribed by any and all statutes, orders, rules and
regulations which are applicable to such Benefit Arrangement.
(e) With respect to the employees of the Business, there are no employee
post-retirement medical or health plans in effect, except as required by
Section 4980B of the Code, Part 6 of Subtitle B of Title I of ERISA, or
applicable law.
(f) Except as disclosed in writing to Buyer prior to the date hereof, there
has been no amendment to, written interpretation of or announcement (whether
written or not written) by Seller or any of its Affiliates relating to, or
change in employee participation or coverage under, any Employee Plan or
Benefit Arrangement which would increase materially the expense of maintaining
such Employee Plan or Benefit Arrangement above the level of the expense
incurred in respect thereof for the most recent fiscal year.
(g) The Purchased Assets are not now nor will they after the passage of
time be subject to any Lien imposed under Code Section 412(n) by reason of the
failure of Seller or its Affiliates to make timely installments or other
payments required by Code Section 412.(h). Except as disclosed on Schedule
9.02(g), no Transferred Employee will become entitled to any retirement,
severance or similar benefit or enhanced benefit solely as a result of the
transactions contemplated hereby.
SECTION 9.03. EMPLOYEES AND OFFERS OF EMPLOYMENT. (a) On or before the
Closing Date, Buyer shall offer employment to all active employees of the
Business at the same salary and on terms substantially comparable in the
aggregate to their existing salary and terms of employment by the Seller
(except for such terms as relate to any stock option or similar plan);
provided, that Buyer may terminate at any time after the Closing Date the
employment of any employee who accepts such offer. For purposes of this
Article 9, the term "ACTIVE EMPLOYEE" shall mean any Person who, on the Closing
Date, is actively employed as a full-time employee by Seller or who is on
short-term disability leave, authorized leave of absence, military service or
lay-off with recall rights as of the Closing Date (such inactive employees
shall be offered employment by Buyer as of the date they return to active
employment), but shall exclude any other inactive or former employee including
any Person who has been on long-term disability leave or unauthorized leave of
absence or who has terminated his or her employment, retired or died on or
before the Closing Date. Subject to the first sentence of this
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Section 9.03(a), any such offers shall be at such salary or wage and benefit
levels and on such other terms and conditions as Buyer shall in its sole
discretion deem appropriate. The employees who accept and commence employment
with Buyer are hereinafter collectively referred to as the "TRANSFERRED
EMPLOYEES". Dynatech and the Seller will not take, and will cause each of its
subsidiaries not to take, any action which would impede, hinder, interfere or
otherwise compete with Buyer's effort to hire any Transferred Employees;
provided that this provision shall not affect Dynatech's or the Seller's
obligations under the Salary Continuation Policy (as defined below) or under
any stay agreements with management personnel of Seller. Buyer shall assume
responsibility for each Transferred Employee at the Closing Date. Except as
expressly set forth in Section 9.03(b), each Transferred Employee will receive
full credit from Buyer or any affiliate for his or her years of service with
Dynatech or any subsidiary of Dynatech for purposes of eligibility and vesting
only, and not for benefit accrual.
(b) If the employment by the Buyer of any Transferred Employee is
terminated by the Buyer without Cause within one year after the Closing Date,
Buyer will pay such terminated employee salary continuation benefits for a
minimum of (i) two weeks plus an additional week for each full year of service
after the first full year of service with Seller or any Affiliate if such
employee is not a salaried employee or (ii) four weeks plus an additional week
for each full year of service with Seller or any Affiliate after the first full
year of service if such employee is a salaried employee (the "Salary
Continuation Policy"). For purposes of the Salary Continuation Policy, such
Transferred Employee will receive full credit from Buyer or any affiliate
thereof for his or her years of service with Dynatech or any subsidiary
thereof.
SECTION 9.04. SELLER'S EMPLOYEE BENEFIT PLANS. (a) Seller shall retain all
obligations and liabilities under the Employee Plans and Benefit Arrangements
in respect of each employee or former employee (including any beneficiary
thereof) who is not a Transferred Employee. Except as expressly set forth
herein, Seller or its designated Affiliate shall retain all liabilities and
obligations in respect of benefits accrued as of the Closing Date by, or
obligations or liabilities relating to, Transferred Employees under the
Employee Plans and Benefit Arrangements, and neither Buyer nor any of its
Affiliates shall have any liability with respect thereto. Except as expressly
set forth herein, no assets of any Employee Plan or Benefit Arrangement shall
be transferred to Buyer or any of its Affiliates or to any plan of Buyer or any
of its Affiliates.
(b) With respect to the Transferred Employees (including any beneficiary or
dependent thereof), Seller shall retain (i) all liabilities and obligations
arising under any group life, accident, medical, dental or disability plan or
similar arrangement (whether or not insured) to the extent that such liability
or obligation
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relates to contributions or premiums accrued (whether or not payable), or to
claims incurred (whether or not reported), on or prior to the Closing Date,
(ii) all liabilities and obligations arising under any worker's compensation
arrangement to the extent such liability or obligation relates to the period
prior to the Closing Date, including liability for any retroactive workman's
compensation premiums attributable to such period and (iii) all other
liabilities and obligations arising under the Employee Plans and the Benefit
Arrangements to the extent any such liability or obligation relates to the
period prior to the Closing Date, including proportional accruals from January
1, 1996 through the Closing Date and including, without limitation, liabilities
and obligations in respect of accruals through the Closing Date under any bonus
plan or arrangement, any vacation plans, arrangements and policies.
(c) With respect to any Transferred Employee (including any beneficiary or
dependent thereof) who enters a hospital or is on short-term disability under
any Benefit Arrangement on or prior to the Closing Date and continues in a
hospital or on short-term disability after the Closing Date, Seller shall be
responsible for claims and expenses incurred both before and after the Closing
Date in connection with such Person, to the extent that such claims and
expenses are covered by a Benefit Arrangement, until such time, (if any) that,
in the case of a Transferred Employee, such Person resumes full-time employment
with Buyer or one of its Affiliates and, in the case of any beneficiary or
dependent of a Transferred Employee, such Person's hospitalization has
terminated. With respect to any Benefit Arrangements covering medical expenses
and other costs relating to pregnancies and maternity leave, Seller shall be
responsible for all claims (whether or not reported) and expenses incurred
during the period prior to and ending on the Closing Date, and Buyer or one of
its Affiliates shall be responsible for such benefit arrangements covering such
pregnancies and maternity leave for the period subsequent to the Closing Date.
SECTION 9.05. BUYER BENEFIT PLANS. (a) Buyer or one of its Affiliates will
recognize all service of the Transferred Employees with Seller or any of its
Affiliates, only for purposes of vesting and eligibility to participate in the
Buyer'semployee benefit plans, within the meaning of Section 3(3) of ERISA, in
which the Transferred Employees are enrolled by Buyer or one of its Affiliates
immediately after the Closing Date. Service of Transferred Employees with
Seller or any of its Affiliates shall be recognized by Buyer or one of its
Affiliates for purposes of benefit accrual only as set forth in Section 9.03
hereof.
(b) As soon as practicable after the close of the current plan year of the
401(k) Plan, account balances as of the Closing Date of the Transferred
Employees, including earnings thereon through the date of transfer, shall be
transferred to a defined contribution plan of Buyer or one of its Affiliates.
Such
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transfer shall be effected in accordance with applicable law and regulations
and Buyer shall make or cause to be made, and Seller shall make or cause to be
made, any required filings in connection therewith. Buyer or one of its
Affiliates may require, as a condition to the acceptance of any such transfer,
evidence satisfactory to Buyer of the qualified status of the 401(k) Plan,
including without limitation, a copy of a favorable determination letter from
the Internal Revenue Service and an opinion of counsel that the 401(k) Plan in
operation has remained qualified at all relevant times. In consideration of
such transfer, Buyer or one of its Affiliates shall assume all liabilities to
Transferred Employees under the 401(k) Plan, other than any liability or
obligation for or relating to any matching or profit sharing contributions in
respect of the year in which the Closing Date occurs. Each of the parties
hereto shall pay its own expenses in connection with such transfer. Neither
Buyer nor any of its Affiliates shall assume any other obligations or
liabilities arising under or attributable to the 401(k) Plan, the same to be
retained or assumed by Seller.
SECTION 9.06. NO THIRD PARTY BENEFICIARIES. No provision of this Article
shall create any third party beneficiary or other rights in any employee or
former employee (including any beneficiary or dependent thereof) of Seller or
of any of its subsidiaries in respect of continued employment (or resumed
employment) with either Buyer or the Businesses or any of their Affiliates and
no provision of this Article 9 shall create any such rights in any such Persons
in respect of any benefits that may be provided, directly or indirectly, under
any Employee Plan or Benefit Arrangement or any plan or arrangement which may
be established by Buyer or any of its Affiliates. No provision of this
Agreement shall constitute a limitation on rights to amend, modify or terminate
after the Closing Date any such plans or arrangements of Buyer or any of its
Affiliates.
ARTICLE 10
SURVIVAL; INDEMNIFICATION
SECTION 10.01. SURVIVAL. The representations and warranties of the parties
hereto contained in this Agreement or in any certificate or other writing
delivered pursuant hereto or in connection herewith shall survive the Closing
until the first anniversary of the Closing Date or (i) in the case of Section
3.16, until the seventh anniversary of the Closing Date, and (ii) in the case
of the representations and warranties contained in Articles 8, until expiration
of the applicable statutory period of limitations (giving effect to any waiver,
mitigation or extension thereof), if later. Notwithstanding the preceding
sentence, any representation or warranty in respect of which indemnity may be
sought under this Agreement shall survive the
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time at which it would otherwise terminate pursuant to the preceding sentence,
if notice of the inaccuracy thereof giving rise to such right to indemnity
shall have been given to the party against whom such indemnity may be sought
prior to such time.
SECTION 10.02. INDEMNIFICATION. (a) Dynatech and the Seller, jointly and
severally, hereby indemnify Buyer and its Affiliates against and agree to hold
each of them harmless from any and all damage, loss, liability and expense
(including, without limitation, reasonable expenses of investigation and
reasonable attorneys' fees and expenses in connection with any action, suit or
proceeding) (collectively, "LOSS") incurred or suffered by Buyer or any of its
Affiliates arising out of:
(i) any misrepresentation or breach of warranty, covenant or
agreement made or to be performed by Dynatech or the Seller
pursuant to this Agreement; or
(ii) the failure of Seller to perform any Excluded Liability;
provided that with regard to the representations and warranties contained
in Sections 3.01 through 3.15 and Sections 3.17 through 3.25 (i) Dynatech and
the Seller shall not be liable under Section 10.02(a)(i) unless the aggregate
amount of Loss with respect to all matters referred to in Section 10.02(a)(i)
(determined without regard to any materiality qualification contained in any
representation, warranty or covenant giving rise to the claim for indemnity
hereunder) exceeds 1.5% of the Purchase Price, whereupon only the amount of
such claims in excess of the foregoing threshold amount shall be recoverable,
and (ii) no indemnification shall be payable by the Seller and Dynatech
pursuant to Section 10.02(a)(i) for amounts in excess of 60% of the Purchase
Price.
(b) Buyer and Great Nordic, jointly and severally, hereby indemnify Seller
and its Affiliates against and agree to hold each of them harmless from any and
all Loss incurred or suffered by Seller or any of its Affiliates arising out of
any misrepresentation or breach of warranty, covenant or agreement made or to
be performed by Buyer or Great Nordic pursuant to this Agreement; provided that
(i) Buyer shall not be liable under this Section 10.02(b) unless the aggregate
amount of Loss with respect to all matters referred to in this Section 10.02(b)
(determined without regard to any materiality qualification contained in any
representation, warranty or covenant giving rise to the claim for indemnity
hereunder) exceeds 1.5% of the Purchase Price and then only to the extent of
such excess and (ii) Buyer's maximum liability under this Section 10.02(b)
shall not exceed 60% of the Purchase Price. Additionally, Buyer and Great
Nordic, jointly and severally, hereby indemnify Seller and its Affiliates
against and agree to hold each of them
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harmless from any and all Loss incurred or suffered by Seller or any of its
Affiliates arising out of any failure by Buyer to perform and discharge any
Assumed Liabilities as set forth in this Agreement, including without
limitation, any liability arising out of or due to the failure of Buyer to
perform and discharge any agreement assigned to and assumed by Buyer pursuant
to this Agreement.
(c) Any amount paid by Seller or Buyer pursuant to Section 10.02 or 10.03
will be treated as an adjustment to the purchase price unless a Final
Determination causes any such amount not to constitute an adjustment to the
Purchase Price for Federal Tax purposes. In the event of such a Final
Determination, Buyer or Seller, as the case may be, shall pay an amount that
reflects the hypothetical Tax consequences of the receipt or accrual of such
payment, using the maximum statutory rate (or rates, in the case of an item
that affects more than one Tax) applicable to the recipient of such payment for
the relevant year and reflecting, for example, the effect of deductions
available for Taxes such as state and local income Taxes.
SECTION 10.03. ENVIRONMENTAL INDEMNIFICATION. Notwithstanding anything to
the contrary in this Agreement, Dynatech and the Seller hereby, jointly and
severally, indemnify Buyer and its Affiliates from and against and agrees to
hold each of them harmless from any and all Losses (including, without
limitation, reasonable expenses of investigation by engineers, environmental
consultants and similar technical personnel) of Buyer and each of its
Affiliates arising out of, in respect of or in connection with Environmental
Liabilities.
SECTION 10.04. ACS LITIGATION. With respect to the pending litigation
between Seller and ACS Wireless, Inc. ("ACS") in actions filed by ACS against
Seller in the United States District Court for the Northern District of
California and by Seller against ACS in the United States District Court for
the District of Massachusetts (collectively, the "LITIGATION"), Buyer and
Seller hereby agree that Seller shall remain responsible for the prosecution
and defense of these matters. Seller shall not compromise or settle the
Litigation without the prior consent of Buyer, which consent will not be
unreasonably withheld. Seller agrees to indemnify and hold harmless Buyer and
its Affiliates from and against any and all Losses of Buyer and each of its
Affiliates arising out of, in respect of or in connection with the Litigation;
provided that Buyer shall be responsible for any royalty or similar payments
arising with respect to the sale after the date hereof of any products of the
Business as stipulated in any settlement or compromise agreement entered into
with the consent of Buyer with respect to the Litigation, which consent will
not be unreasonably withheld.
SECTION 10.05. PROCEDURES. Promptly after receipt by a party seeking
indemnification under Sections 10.02 or 10.03 (the "INDEMNIFIED PARTY") of
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notice of any claim, liability or expenses to which the indemnification
obligations hereunder would apply, such party shall give notice thereof in
writing to the party against whom indemnity is sought (the "INDEMNIFYING
PARTY"). Such notice shall state the information then available regarding the
amount and nature of such claim, liability or expenses. If within 20 days
after receiving such notice the Indemnifying Party gives written notice to the
Indemnified Party stating that it disputes and intends to defend against such
claim, liability or expense at its own cost and expense, then counsel for the
defense, reasonably satisfactory to the Indemnified Party, shall be selected by
the Indemnifying Party and the Indemnified Party shall make no payment on such
claim. If no such notice of intent to dispute and defend is given by the
Indemnifying Party, the Indemnified Party shall, at the expense of the
Indemnifying Party, undertake the defense of such claim, liability or expense
(with counsel selected by the Indemnified Party), and shall have the right to
compromise or settle the same (exercising reasonable business judgment) with
the approval of the Indemnifying Party, which approval shall not be
unreasonably withheld.
SECTION 10.06. PAYMENT OF CLAIMS; ARBITRATION. All claims shall be paid or
otherwise satisfied by the Indemnifying Party within 60 days after notice
thereof is given by the Indemnified Party. If within said 60-day period, the
Indemnifying Party indicates in a writing delivered to the Indemnified Party
that it disputes the nature or amount of the claim, the dispute upon the
election of any party hereto after said 60-day period shall be settled by
arbitration in accordance with the provisions of Section 11.05.
SECTION 10.07. CALCULATION OF DAMAGES. The Indemnified Party shall be
entitled to recover the full amount of any loss incurred due to the matter for
which indemnification is sought, but any recovery shall be net of any benefit
received by the Indemnified Party due to such loss, including, without
limitation, any tax benefit, insurance proceeds or warranty reimbursements,
received by the Indemnified Party as a result thereof.
SECTION 10.08. LIMITATION ON REMEDIES. It is specifically understood and
agreed that in the event a misrepresentation or breach of warranty is
discovered by Buyer or Seller after the Closing, Buyer's or Seller's, as
applicable, remedies shall be limited solely to the indemnification set forth
in this Article 10, except for any claims sounding in fraud.
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ARTICLE 11
MISCELLANEOUS
SECTION 11.01. Notices. All notices, requests and other communications to
either party hereunder shall be in writing (including facsimile transmission)
and shall be given,
if to Great Nordic, to:
GN Great Nordic as
Kgs. Nytorv 26
1016 Kebenhaven K
Denmark
Attention: Poul Erik Tofte
Telecopy: 011-45-33-95-08-69
if to Buyer, to:
GN Netcom as
Bispevej 4
DK-2400 Copenhagen NV
Attention: Christian F. Tillisch
Telecopy: 011-45-3815-8601
with a copy to:
John A. Bick
Davis Polk & Wardwell
450 Lexington Avenue
New York, New York 10017
Telecopy: (212) 450-4800
if to Seller, to:
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c/o Dynatech Corporation
3 New England Executive Park
Burlington, MA 01803
Attn: Roger Cady, Vice President
Business Development
Telecopy: 617-229-8850
if to Dynatech:
Dynatech Corporation
3 New England Executive Park
Burlington, MA 01803
Attn: Roger Cady, Vice President
Business Development
Telecopy: 617-229-8850
with a copy to:
Hale and Dorr
60 State Street
Boston, MA 02109
Attn: Peter B. Tarr, Esq.
Telecopy: 617-526-5000
All such notices, requests and other communications shall be deemed received on
the date of receipt by the recipient thereof if received prior to 5 p.m. in the
place of receipt and such day is a Business Day in the place of receipt.
Otherwise, any such notice, request or communication shall be deemed not to
have been received until the next succeeding Business Day in the place of
receipt.
SECTION 11.02. AMENDMENTS AND WAIVERS. (a) Any provision of this Agreement
may be amended or waived prior to the Closing Date if, but only if, such
amendment or waiver is in writing and is signed, in the case of an amendment,
by each party to this Agreement, or in the case of a waiver, by the party
against whom the waiver is to be effective.
(b) No failure or delay by any party in exercising any right, power or
privilege hereunder shall operate as a waiver thereof nor shall any single or
partial exercise thereof preclude any other or further exercise thereof or the
exercise of any other right, power or privilege. The rights and remedies
herein provided shall be cumulative and not exclusive of any rights or remedies
provided by law.
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SECTION 11.03. EXPENSES. Except as otherwise provided herein, all costs and
expenses incurred in connection with this Agreement shall be paid by the party
incurring such cost or expense.
SECTION 11.04. SUCCESSORS AND ASSIGNS. The provisions of this Agreement
shall be binding upon and inure to the benefit of the parties hereto and their
respective successors and assigns; provided that no party may assign, delegate
or otherwise transfer any of its rights or obligations under this Agreement
without the consent of each other party hereto except that Buyer may transfer
or assign, in whole or from time to time in part, to one or more of its
Affiliates, the right to purchase all or a portion of the Purchased Assets, but
no such transfer or assignment will relieve Buyer of its obligations hereunder.
SECTION 11.05. ARBITRATION. With the exception of the rights and obligations
of Dynatech, the Seller, and the Buyer (collectively, the "PARTIES," but
individually the "PARTY") under Section 5.03 hereof, all disputes arising out
of this Agreement shall be settled as far as possible by negotiations between
the Parties. If the Parties cannot agree on an amicable settlement within
thirty (30) days from written submission of the matter by one or more of the
Parties to the other Party or Parties, the matter shall be submitted for
decision and final resolution to arbitration to the exclusion of any courts of
law, under the rules of Conciliation and Arbitration of the International
Chamber of Commerce of Paris, France (the "ICC").
The arbitration tribunal shall be composed of one disinterested arbitrator,
appointed pursuant to the following procedure: the Party or Parties invoking
arbitration shall notify the other Party or Parties by registered air mail
stating the substance of its or their claim. The Parties shall agree on the
arbitrator, who may be a citizen of any country. Within thirty days of receipt
of such notification, the other Party or Parties shall notify the initiating
Party or Parties by registered air mail its or their answer to the claim made,
and any counterclaim which it wishes or they wish to assert in the arbitration.
If the Parties are unable to agree to an arbitrator within thirty (30) days,
appointment of the arbitrator shall be made by the Court of Arbitration of the
ICC upon request of any Party.
The arbitrator will decide the dispute in accordance with the internal laws
of the State of Delaware. The decision shall be rendered in writing, shall
state the reasons on which it is based, and shall bear the signature of the
arbitrator. It also shall identify the time and place of the award granted.
Finally, the Party or Parties which do not prevail in such proceedings shall
pay the expenses of the arbitration.
The arbitration decision shall be rendered as soon as possible, not later,
however, if possible, than six months after the constitution of the arbitration
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tribunal. The arbitration decision shall be final and binding upon all of the
Parties and the Parties agree that any award granted pursuant to such decision
may be entered forthwith in any court of competent jurisdiction. This
arbitration clause and any award rendered pursuant to it shall be governed by
the United Nations Convention on the Recognition and Enforcement of Foreign
Arbitration Awards signed in New York on June 10, 1958.
The seat of arbitration will be New York City, unless the Parties otherwise
agree in writing. The official arbitration language shall be English.
SECTION 11.06. GOVERNING LAW. This Agreement shall be governed by and
construed in accordance with the internal laws of the State of Delaware.
SECTION 11.07. COUNTERPARTS; EFFECTIVENESS. This Agreement may be signed in
any number of counterparts, each of which shall be an original, with the same
effect as if the signatures thereto and hereto were upon the same instrument.
This Agreement shall become effective when each party hereto shall have
received a counterpart hereof signed by the other party hereto.
SECTION 11.08. ENTIRE AGREEMENT; THIRD PARTY BENEFICIARIES. This Agreement,
the Disclosure Schedule hereto, and all exhibits hereto constitute the entire
agreement between the parties with respect to the subject matter hereof and
supersedes all prior agreements and understandings, both written and oral,
between the parties with respect to the subject matter of this Agreement. No
representation, inducement, promise, understanding, condition or warranty not
set forth herein has been made or relied upon by either party hereto. Neither
this Agreement nor any provision hereof is intended to confer upon any Person
other than the parties hereto any rights or remedies hereunder.
SECTION 11.09. BULK SALES LAWS. Buyer and Seller each hereby waive
compliance by Seller with the provisions of the "BULK SALES", "BULK TRANSFER"
or similar laws of any state. Seller agrees to indemnify and hold Buyer
harmless against any and all claims, losses, damages, liabilities, costs and
expenses incurred by Buyer or any of its Affiliates as a result of any failure
to comply with any such "bulk sales", "bulk transfer" or similar laws.
SECTION 11.10. CAPTIONS. The captions herein are included for convenience of
reference only and shall be ignored in the construction or interpretation
hereof.
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IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
duly executed by their respective authorized officers as of the day and year
first above written.
GN GREAT NORDIC
By:/s/ Jorn Kildegaard
---------------------------------
Title: Executive Vice President
GN NETCOM/UNEX INC.
By:/s/ Christian Tillisch
---------------------------------
Title: President
DYNATECH CORPORATION
By:/s/ Roger C. Cady
---------------------------------
Title: VIce President
UNEX CORPORATION
By:/s/ Roger C. Cady
---------------------------------
Title: Vice President
50
Exhibit B
ASSIGNMENT AND ASSUMPTION AGREEMENT
ASSIGNMENT AND ASSUMPTION AGREEMENT, dated as of October 21, 1996, between
UNEX Corporation, a Massachusetts corporation ("SELLER"), and GN Netcom/Unex,
Inc., a Delaware corporation ("BUYER").
W I T N E S S E T H
WHEREAS, Buyer and Seller have concurrently herewith consummated the
purchase by Buyer of the Purchased Assets pursuant to the terms and conditions
of the Asset Purchase Agreement dated October 21, 1996 between Buyer, GN Great
Nordic as, Dynatech Corporation and the Seller, (the "ASSET PURCHASE
AGREEMENT"; terms defined in the Asset Purchase Agreement and not otherwise
defined herein being used herein as therein defined);
WHEREAS, pursuant to the Asset Purchase Agreement, Buyer has agreed to
assume certain liabilities and obligations of Seller with respect to the
Purchased Assets and the Business;
NOW, THEREFORE, in consideration of the sale of the Purchased Assets and in
accordance with the terms of the Asset Purchase Agreement, Buyer and Seller
agree as follows:
1. (a) Seller does hereby sell, transfer, assign and deliver to Buyer all
of the right, title and interest of Seller in, to and under the Purchased
Assets; provided that no sale, transfer, assignment or delivery shall be made
of any or any material portion of any of the Contracts or Permits if an
attempted sale, assignment, transfer or delivery, without the consent of a
third party, would constitute a breach or other contravention thereof or in any
way adversely affect the rights of Buyer or Seller thereunder.
(b) Buyer does hereby accept all the right, title and interest of Seller
in, to and under all of the Purchased Assets (except as aforesaid) and Buyer
assumes and agrees to pay, perform and discharge promptly and fully when due
all of the Assumed Liabilities and to perform all of the obligations of Seller
to be performed under the Contracts.
2. It is expressly understood and agreed that all liabilities,
obligations and commitments not assumed hereunder by the Buyer pursuant to
Paragraph 1 above
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shall remain, as between the Buyer and the Seller, the sole obligation of the
Seller and its respective successors and assigns.
3. The Buyer agrees to indemnify and hold harmless the Seller in
accordance with the provisions of the Asset Purchase Agreement.
4. The Buyer and the Seller, by their execution of this Assignment
and Assumption Agreement, each hereby acknowledges and agrees that neither the
representations and warranties nor the rights and remedies of either party
under the Asset Purchase Agreement shall be deemed to be enlarged, modified or
altered in any way by such execution of this agreement.
5. This Agreement shall be governed by and construed in accordance
with the law of the State of Delaware, without regard to the conflicts of law
rules of such state.
6. This Agreement may be executed in one or more counterparts, each
of which shall be deemed to be an original, but all of which together shall
constitute one and the same instrument.
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
duly executed as of the day and year first above written.
UNEX CORPORATION
By:
-----------------------------
Name:
Title:
GN NETCOM/UNEX, INC.
By:
-----------------------------
Name:
Title:
2