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EXHIBIT 2.2
S H A R E P U R C H A S E A G R E E M E N T
THIS SHARE PURCHASE AGREEMENT, entered into on this 29th day of June, 1998, by
and among Xxxxxxx Xxxxxxx ("Xxxxxxx"), Xxxxxxxxx Xxxxx ("Xxxxx") and Xxxxxxxx
Xxxxxxxx ("Xxxxxxxx") (each, individually a "Seller" and collectively, the
"Sellers") and FSA Combination Corporation, a corporation organized and existing
under the laws of Delaware, United States of America, having its principal
office at 0000 Xxxxxxx Xxxxxx, Xxxxx Xxxxx, Xxxxxxxxxx 00000, Xxxxxx Xxxxxx of
America (the "Purchaser"). The Purchaser is a one hundred percent (100%)
subsidiary of Networks Associates, Inc. ("NAI"), a corporation organized and
existing under the laws of Delaware, United States of America.
WITNESSETH:
WHEREAS, the Sellers own one hundred per cent (100 %) of the issued and
outstanding ownership quotas in CSB Consulenza Software di Base Srl, an Italian
company engaged in the business of reselling software applications and services,
having its registered office in Milan, Italy (the "Company"), distributed as
follows:
QUOTA %
----- -
Xxxxxxx 7,200,000 36
Xxxxx 6,400,000 32
Fracasso 6,400,000 32
WHEREAS, the Purchaser is willing to acquire all of the issued and outstanding
shares in the Company and the Sellers are willing to sell and transfer such
shares to the Purchaser subject to the terms and conditions hereinafter set
forth.
NOW, THEREFORE, the Parties hereby agree as follows:
1. DEFINITIONS
As used in this Agreement, unless expressly otherwise stated or
evident in the context, the following terms shall have the following
meanings, the singular (where appropriate) shall include the plural
and vice versa and references to Schedules and Sections shall mean
Schedules and Sections of this Agreement:
1.1 "ACCOUNTS" shall mean the statutory profit and loss
statement and balance sheet of the
Company including the notes thereto as
at the Accounts Date, together with the
accompanying management's report ,
attached hereto as SCHEDULE 1.1.
1.2 "ACCOUNTS DATE" shall mean April 30, 1998.
1.3 "AGREEMENT" shall mean this Share Purchase Agreement
and the Schedules hereto.
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1.4 "ACCOUNTING PRINCIPLES" shall mean the Italian GAAP (Principi
Contabili del Xxxxxxxxx Nazionale dei
Dottori Commercialisti)
1.5 "BUSINESS" shall mean the business of Company as
presently carried out by the Company,
including the assets and rights of
whatever nature, relating to such
business.
1.6 "CLOSING" shall mean the consummation of the
transaction as contemplated in Section
5.
1.7 "CLOSING ACCOUNTS" shall mean the profit and loss statement
and balance sheet of the Company as at
the Closing Date, , to be prepared in
accordance with the Accounting
Principles and as provided in Section
3.3.
1.8 "CLOSING ACCOUNTS shall mean the Closing Date.
DATE"
1.9 "CLOSING DATE" shall mean June 29, 1998 or such later
date as specified in Section 5.1.
1.10 "COMPANY" shall mean CSB Consulenza Software di
Base Srl, an Italian company entered in
the Trade Register under No.293622.
1.11 "ORDINARY COURSE OF shall mean the ordinary course of
BUSINESS" business of the Company consistent with
past customs and business practices and
always in accordance with good and sound
business practice.
1.12 "PARTY" shall mean the Purchaser or the Sellers,
as the context may require, and
"PARTIES" shall be construed
accordingly.
1.13 "PURCHASE PRICE" shall mean the aggregate purchase price
of the Shares in accordance with Section
3.
1.14 "PURCHASER" shall have the meaning as set out in the
introductory paragraph hereof.
1.15 "PURCHASER'S ACCOUNTANTS" shall mean Xxxxxxx Xxxxxxx of Coopers &
Xxxxxxx, Xxxxx.
1.16 "RELATED AGREEMENTS" shall mean the agreements referred to in
Section 9.1.
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1.17 "SELLER" shall have the meaning as set out in the
introductory paragraph hereof. When
there is any reference to the Sellers,
the reference shall be to each of the
Sellers, jointly and severally.
1.18 "SHARES" shall mean the quotas to be transferred
by the Sellers to the Purchaser as
contemplated herein, representing all of
the issued and outstanding quotas of the
Company.
1.19 "TRANSFER DEED" shall mean the agreement referred to in
Section 5.4 (a).
1.20 "TAXES" shall mean all income tax, value added
tax and any other taxes and similar
charges (including, in particular,
social security charges) imposed by any
authority, including all penalties and
interest.
2. OBJECT OF THE TRANSACTION
Upon the terms and subject to the conditions set forth herein, and in
reliance upon the representations, warranties, assurances and
undertakings made herein by each Party to the other Party, the Sellers
hereby agree to sell and the Purchaser hereby agrees to purchase the
Shares as of the Closing Date.
3. PURCHASE PRICE
3.1 PURCHASE PRICE
(a) The purchase price for the Shares (the "Purchase Price") shall
be Italian lira Eight Hundred million (800,000,000 lire),
allocated among the Sellers in proportion to their respective
participation in the Company, as below indicated.
(b) The Purchase Price shall be paid by the delivery to the
Sellers of the number identified in 3.1.(c) below of shares of
common stock of Network Associates, Inc.
("NAI-Shares").
The NAI-Shares shall be allocated among the Sellers as
follows:
Xxxxxxx: thirty-six per cent (36 %) of the NAI-Shares equal to 3180 shares
Xxxxxxxx: thirty-two per cent (32 %) of the NAI-Shares equal to 2827 shares.
Xxxxx: thirty-two per cent (32 %) of the NAI-Shares equal to 28 27 shares
(c) For the purpose of calculating the number (rounded in
aggregate to the nearest whole share) of the Purchaser's
shares constituting the NAI-Shares as defined in Section 3.1.
(b) above, the Parties agree to divide the Purchase Price by
the closing bid price of an NAI-share as quoted on the NASDAQ
for a day ending on the 2nd to last day prior to the Closing.
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For the purpose of determining the number of shares, the
Purchase price is deemed to be worth USD 451,440 by applying a
USD/ILT exchange rate equal to 0.05643.
(d) At the Closing, from the NAI-Shares otherwise deliverable
pursuant to this Section 3.1, Purchaser shall deposit 981
shares corresponding to 10% of the Purchase Price calculated
as stated in 3.1.(c) above into escrow pursuant to the escrow
agreement ("Escrow Agreement") substantially in the form
attached hereto as SCHEDULE 3.1.(d).
3.2 [DELETED]
3.3 CLOSING ACCOUNTS
(a) As promptly as practicable, and in any event not more than
thirty (30) days following the Closing Accounts Date, the
Sellers shall prepare and deliver to the Purchaser and the
Purchaser's Accountants the Closing Accounts.
(b) The Purchaser's Accountants shall verify the Closing Accounts
and shall for such purpose have access to all the records and
book-keeping material relating to the Company to the extent
required for the purposes of such verification. The Purchaser
may dispute the Closing Accounts by notifying the Sellers in
writing of the amount(s) in dispute and the basis for such
dispute within thirty (30) days from the receipt of the
Closing Accounts.
(c) The Purchaser and the Sellers shall in good faith endeavour to
resolve any dispute under Section 3.3 (b) above within thirty
(30) days from the date of receipt by the Sellers of the
Purchaser's written notice of dispute, failing which the
matter shall be finally resolved by a certified public
accountant selected by the Parties, provided that if the
parties are unable to agree, the choice made by Coopers &
Xxxxxxx, Xxxxx, shall govern. Such person is hereby jointly
appointed by the Parties as sole and exclusively Arbitrator,
which shall determine the issue by arbitration in accordance
with Section 10.9.
4. TRANSFER OF TITLE
The full and unrestricted ownership and title to the Shares shall pass
from the Sellers to the Purchaser at the Closing on the Closing Date
simultaneously with the fulfilment and completion of the Closing
procedures set forth in Section 5.
5. CLOSING
5.1 THE CLOSING
The Closing shall take place on the Closing Date starting at 10.00 p.m.
at the offices of Xxxxx & XxXxxxxx, 3 Xxxxxx Xxxx, 00000 Xxxxx, Xxxxx.
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The Closing Date shall be June 29, 1998, or, subject to Section 5.5, as
soon thereafter as practicable when all the conditions precedent for
the Closing as set forth in this Section 5. have been fulfilled.
5.2 PURCHASER'S CONDITIONS PRECEDENT
The obligation of the Purchaser to close hereunder shall be subject to
the fulfilment, on or before the Closing Date, of each of the following
conditions (to the extent not waived by the Purchaser) and all of which
that require documentation shall be in form and substance satisfactory
to the Purchaser and its counsel in their reasonable judgement:
(a) New Information
The Purchaser shall not have become aware of any new information
between the date hereof and the Closing Date which in the Purchaser's
reasonable judgement would have a material adverse effect on the
Company or the Business.
(b) Board of Directors
The present members of the Board of Directors of the Company shall, to
the extent required by the Purchaser, as of the Closing Date have been
substituted with new members designated by the Purchaser.
(c) Authority Approvals
The Purchaser, the Sellers or the Company, as the case may be, shall
have obtained all necessary authorizations, approvals and consents from
all relevant authorities in Italy, the European Union or elsewhere, as
the case may be, required for the lawful and valid consummation of the
transactions contemplated hereunder.
(d) Board Approval
The Board of Directors of the Purchaser shall have approved the
consummation of the transactions contemplated hereby.
(e) Corporate Action
All corporate action necessary for the lawful and valid consummation of
the transactions contemplated hereby shall have been duly taken by the
Sellers and, as applicable, by the Company and shall be in full force
and effect. Without limiting the foregoing, a shareholders' meeting of
the Company has approved the transaction as described herein as
required by the current by-laws.
(f) Related Agreements
The Purchaser, the Sellers and, as appropriate, the Company and/or any
other relevant party shall have entered into the Related Agreements and
all the conditions precedent for the entry into force of such
agreements shall have been fulfilled.
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5.3 SELLERS'S CONDITIONS PRECEDENT
The obligation of the Sellers to close hereunder shall be subject to
the satisfaction, on or before the Closing Date, of each of the
following conditions (to the extent not waived by the Sellers) and all
of which that require documentation shall be in form and substance
satisfactory to the Sellers and their legal counsel in their reasonable
judgement:
(a) Warranties True
The representations, warranties and assurances given by the Purchaser
in Section 7. shall be true and correct on and as of the Closing Date
with the same effect as though such representations, warranties and
assurances had been made on and as of such date.
(b) Corporate Action
All corporate action necessary for the lawful and valid consummation by
the transactions contemplated hereby shall have been duly taken by the
Purchaser and shall be in full force and effect.
(c) Authority Approvals
The Purchaser, the Sellers or the Company, as the case may be, shall
have obtained all necessary authorizations, approvals and consents from
all relevant authorities in Italy, the European Union or elsewhere, as
the case may be, required for the lawful and valid consummation of the
transactions contemplated hereunder.
(d) Related Agreements
The Purchaser, the Sellers and, as appropriate, the Company and/or any
other relevant party shall have entered into the Related Agreements and
all the conditions precedent for the entry into force of such
agreements shall have been fulfilled.
5.4 DELIVERIES AT CLOSING
At the Closing
(a) the Sellers shall sell, transfer and convey to the Purchaser
the Shares by signing before the notary public and then
delivering the Transfer Deed in the form attached as SCHEDULE
5.4 (a), as well as all other documents, if any, required for
the valid and effective transfer and registration of the title
to the Shares in the name of the Purchaser. It is understood
that the Transfer Deed is signed only in order to implement
the present transaction according to art. 2479 of the Italian
Civil Code and that for whatever not provided in the Transfer
Deed, in case of any inconsistency between the Transfer Deed
and the provisions of this Agreement, the provisions of this
Agreement shall prevail;
(b) the Sellers shall convey to the Purchaser all the corporate
book and registers of the Company;
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(c) the Purchaser shall pay to each of the Sellers the
consideration referred to in Section 3.1 (b);
(d) a shareholders' meeting of the Company shall resolve upon the
appointment of a Board of Directors composed by the members
listed in SCHEDULE 5.4 (d);
(e) any other document, condition, amount or matter herein called
for to be produced, delivered, released, paid or fulfilled at
the Closing as a condition precedent shall be so produced,
delivered, released, paid and fulfilled.
5.5 BEST EFFORTS TO CLOSE
The Parties shall use their respective best efforts to cause all
necessary action to be taken in order to have all the conditions
precedent for the Closing to be fulfilled as promptly as practicable
and to have all deliveries made timely and properly as provided in
Section 5.4. Unless the Closing has taken place by June 29, 1998,
either Party may cancel this Agreement upon written notice to the other
party.
6. REPRESENTATIONS, WARRANTIES AND ASSURANCES OF THE SELLERS
The Sellers acknowledge that the Purchaser is entering into this
Agreement in reliance on the representations, warranties and assurances
(the "Warranties") hereby given by the Sellers to the Purchaser being
true and correct both on the date hereof and on the Closing Date and
consequently the Sellers hereby represent, warrant and assure that the
statements set out in this Section 6. are true and correct both on the
date hereof and at the Closing.
6.1 ORGANIZATION, GOOD STANDING
The Company is a corporation duly organized, validly existing and in
good standing under the laws of Italy, and has full power to carry on
the Business as now being conducted.
6.2 RECORDS AND DOCUMENTATION
(a) True, complete and current copies of the Articles of
Association and registration certificates of the Company are
attached hereto as SCHEDULE 6.2 (a).
(b) All corporate documentation of the Company, including, without
limitation, share registers, minutes of the board of
directors' meetings and shareholders' meetings, exists and is
safely kept, correct, complete and up-to-date.
(c) The Company has not failed to file its annual reports with the
relevant authorities, as required.
(d) The books and records relating to the purchase of materials
and supplies, manufacture or processing of products or
services, sales of products and services, dealings with
customers, invoices, customer lists, inventories, supplier
lists,
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personnel records and taxes of the Company are accurate and
have been maintained consistent with good business practices
and are in the possession of the Company.
6.3 TITLE AND AUTHORITY TO TRANSFER THE SHARES; CAPITALIZATION
(a) The authorized capital stock of the Company consists of quotas
for 20,000,000 ITL. The Stock is held by the persons and in
the amounts set forth in the Recitals to this Agreement.
Sellers own all the shares of the Company and have full power,
capacity and authority to sell and transfer the Shares and to
perform all other undertakings set forth in this Agreement and
the Related Agreements. The Shares are freely transferable to
the Purchaser and are free and clear of all restrictions on
the ability to vote the Shares. The Shares are not subject to
claims, options, liens, charges and other encumbrances of any
kind.
(b) The execution of this Agreement and the Related Agreements and
the consummation of the transaction contemplated herein and
the fulfilment of the terms hereof, will not result in a
breach of any judgment, decree or order of any court or
governmental body, any applicable law or the Articles of
Association of the Sellers or the Company or any contract
binding on the Sellers or the Company.
(c) The Shares have been duly authorized, legally and validly
issued and are fully paid and non-assessable. There are no
outstanding obligations, warrants, options, depository
receipts, calls, subscriptions, pre-emptive rights, contracts
or agreements to which the Sellers or the Company are bound,
providing for the issuance of any additional shares of the
Company or obligating the Company to issue, deliver, sell,
repurchase or redeem any interest in the Company or obligating
the Company to grant, extend, accelerate the vesting of,
change the price of, otherwise amend or enter into any such
option, warrant, call, right, commitment or agreement. As a
result of the transactions contemplated by this Agreement, NAI
will be the record and beneficial owner of all outstanding
capital stock of the Company and rights to acquire capital
stock of the Company.
(d) The Company does not own any interest, directly or indirectly,
in any corporation, partnership or other legal entity and does
not have any branch office.
6.4 THE ACCOUNTS
The Accounts are, and the Closing Accounts in due course will be,
complete and correct in all respects and truly and correctly reflect
the results of operation, the financial condition, the assets and
liabilities of the Company as at the relevant date(s) and have been
prepared in conformity with the Accounting Principles.
In particular, the Accounts, and the Closing Accounts in due course
will, include provision in full for all liabilities which the Company
has or may incur in the future deriving from any event, act or
occurrence before the Accounts Date or the Closing Date, as the case
may be (including, without limitation, any liabilities for vacation
salaries and
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premiums, taxes, pension, retirement or similar obligations); they do
not overstate the value of any assets; and they include provision for
all warranty claims and for bad and doubtful debts.
6.5 ASSETS AND PROPERTIES
(a) The Company owns no real property. The Company has exclusive
title to all the other assets recorded in the Accounts except
for such assets that have been sold at ordinary market terms
in the Ordinary Course of Business after the Accounts Date.
None of the assets are subject to any liens, mortgages,
charges or other encumbrances, except as noted in the
Accounts.
(b) The Company owns or leases, and will following the
consummation of the transactions contemplated herein continue
to own and lease all the assets and rights, including
intellectual property, and produces all services required to
conduct the Business as currently conducted on a stand alone
basis and without the necessity to acquire additional assets
or services not provided in this Agreement or the Related
Agreements at additional cost.
(c) All the stock and inventory of the Company, are within
specifications and of merchantable quality.
(d) All land and buildings used or occupied by the Company are
specified in SCHEDULE 6.5 (d) attached hereto.
The present use of such properties is not restricted by any
material restriction or condition and conform to planning
regulations, fire and safety regulations, including Law
626/94, to the requirements of the relevant local authorities
and to all statutes governing the property or use thereof. All
requisite permissions have been obtained and are valid and
subsisting for all developments or alterations to or other
works on or in relation to any of the properties and all
conditions or restrictions imposed in or by any such
permissions have been complied with and nothing further
remains to be done thereunder.
6.6 INTELLECTUAL PROPERTY
(a) SCHEDULE 6.6 (a) lists all Italian and foreign patents, patent
applications and patent licenses; copyrights and copyright
licenses, including regarding software; know-how licenses;
trademarks and applications, registrations and licenses
therefor; trade names and applications, registrations and
licenses therefor; recipes, blending formulas and product
descriptions; owned or used by the Company in the operation of
its business (the "Intellectual Property"), as well as
Intellectual Property licensed by the Company to others. The
Company owns all intellectual property necessary to produce
the services presently produced, and to distribute and sell
such products and services in any country where business
presently is conducted.
(b) SCHEDULE 6.6 (b) also identifies all of the Intellectual
Property used by the Company which is owned or controlled by
any director, officer or employee of
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the Company. All such Intellectual Property is licensed to the
Company on a perpetual, irrevocable, fully paid up, royalty
free basis by its owner.
(c) The Intellectual Property comprises all such rights necessary
to permit the operation of the Business as now being
conducted. None of the Intellectual Property is subject to any
outstanding order, judgement, lien, encumbrance or attachment.
There are no pending or, to the best knowledge of Sellers,
threatened proceedings, litigation or other adverse claims
affecting any part of the Intellectual Property, and no person
or entity is infringing the Company's rights to the
Intellectual Property.
(d) There is no claim of infringement, violation or breach by the
Company of any domestic or foreign patents, trademarks,
copyrights or other intellectual property rights owned or
controlled by others (collectively "Others' Intellectual
Property"). There is no basis upon which a claim can
successfully be asserted against the Company for infringement,
violation or breach of any part of Others' Intellectual
Property.
(e) No Seller or, to the best knowledge of Sellers, any employee
of the Company is employed in violation of any non-disclosure
or non-competition agreement.
6.7 ACCOUNTS RECEIVABLE
All of the receivables of the Company are good and fully collectible
within one hundred and eighty (180) days from the date when they become
due and payable at the recorded amounts together with interest thereon.
6.8 PRICING OF CONTRACTS
All the tenders and contracts binding on the Company have been priced
as required by good and sound business practice and allowing for a
reasonable profit.
6.9 COMPLIANCE
(a) All authorizations and approvals necessary for the due conduct
of the Business have been duly obtained and are in full force
and effect, and the entry into and the consummation of this
Agreement will not cause any termination, revocation,
suspension or modification thereof, nor has there been any
violation of any such authorizations or approvals of any terms
thereof.
(b) The Company has been and is in full compliance with all laws
and regulations applicable to it, including terms and
conditions set in any authorizations and approvals, and with
the requirements of all applicable agencies and authorities,
and the Company has obtained all applicable authorizations and
approvals which are required under all of such laws.
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6.10 INSURANCE
Attached hereto as SCHEDULE 6.10 are true and complete list of all the
insurance policies, currently in effect and maintained by the Company
in respect of the Business and the Assets (the "Insurance Policies")
and details thereof. The Insurance Policies provide the types and
amounts of insurance coverage normal and customary for similar
companies in Italy.
6.11 AGREEMENTS, CONTRACTS AND COMMITMENTS
Except as set forth in Schedules 6.11. (a) to (c), whereby the
exceptions shall be supported by the relevant documents or contractual
instruments to be attached under the same schedules, :
(a) The Company is not a party to, or bound by:
(i) any option, joint venture, co-operation, license,
agency, distribution, lease or any other material
agreement;
(ii) any consultancy agreement, contract, understanding or
relationship with any officer, employee or individual
or any such agreement, contract, understanding or
relationship that contains any severance or
termination pay liabilities or obligations, except
for employment agreements for which severance
obligations are limited to the extent of mandatory
provision of Italian labour laws;
(iii) any agreement or contract outside the Ordinary Course
of Business which involves the payment of cash or
other property, an unperformed commitment, or goods
or services;
(iv) any power of attorney or any agency agreement or
arrangement with any person pursuant to which such
person is granted the authority to act for or on
behalf of the Company;
(v) any loan or credit arrangement or guarantee providing
for the borrowing or potential borrowing by the
Company or the guarantee by the Company of any sum.
(b) All agreements or contracts to which the Company is a party
are valid, binding and enforceable in accordance with their
respective terms they are not subject to change of control
clauses, and their expiration date, if falling within 6 months
after the Closing, is indicated in the Schedule 6.11 (b). The
Company is not in default in any material respect in the
performance of any of its obligations under any agreement or
contract and no event has occurred which (whether with or
without notice, lapse of time, or both) would constitute a
default thereunder by the Company.
(c) All contracts, agreements, understandings or other
arrangements regarding the provision of goods and/or services
between the Company and the Sellers or any
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other company in the Sellers's group of companies or any
Sellers' relatives up to the 4th degree according to the
Italian Civil Code are described in SCHEDULE 6.11 (c). The
terms and conditions on which goods and/or services are
rendered pursuant to such arrangements are at arms' length.
6.12 EMPLOYMENT AND PENSION AGREEMENTS
(a) A true, complete and current list of all employments of the
Company indicating level of employment, category and
seniority, as well as the salaries, wages and fringe benefits
paid or granted to the employees of the Company at the date
hereof are set forth in SCHEDULE 6.12 (a) and there have been
no increases in salaries, wages and fringe benefits of such
employees after the Accounts Date, except as may be required
by collective bargaining agreements. All employees are
employed for indefinite duration and according to the laws and
applicable collective agreements. There are no other employees
or individuals who can claim to be employees of the Company
except for those listed in SCHEDULE 6.12 (a) (i).
(b) No employee having management responsibility has announced his
or her termination of his or her position or employment with
the Company.
(c) Full provision has been made in the Accounts and will, in due
course, be made in the Closing Accounts, for the full amount
of all present and future liabilities in respect of employment
severence compensation (T.F.R.) or pension undertakings to be
paid to current or former directors, officers or other
employees of the Company.
(d) The Company is not in breach of any labour laws and has not
received notice, which notice remains current, of any claim
that it has not complied with any employment, labour or
related laws. All social security obligations and withholding
obligations with respect to any employee, officer or director
has always been complied with by the Company and will be
complied until the Date of Closing.
(e) The Company has neither signed, nor is it liable under any
policy of, any life or alike personal insurances in excess of
compulsory insurances, nor do any of the employees of the
Company enjoy any other benefits in excess of benefits
provided by mandatory law, except as stated in SCHEDULE 6.12
(e).
(f) There are no pending or current and, to the best knowledge of
Sellers, no threatened claims or labour litigation in respect
of the Company. No negotiations are required to be held by the
Company with trade unions under collective bargaining
agreements or otherwise as a result of the transaction
contemplated by this Agreement and no information relating
thereto is required to be conveyed to such trade unions under
collective bargaining agreements or otherwise.
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6.13 CLAIMS; LITIGATION
The Company has not been served with any summons or notice to arbitrate
and there are no actions, arbitrations or other legal proceedings
pending or, to the best knowledge of sellers, threatened against the
Company or by the Company against any other person or entity.
6.14 ORDINARY COURSE OF BUSINESS
(a) During the period from signature hereof and until the Closing
the Sellers will ensure that the Company does not take any
action or measure which is outside the Ordinary Course of
Business, unless such action or measure is directly related to
the transactions contemplated herein or has been approved in
writing by the Purchaser.
(b) There has not since the Accounts Date been
(i) any adverse deviation by the Company from the Ordinary
Course of Business;
(ii) any adverse change in the relationship with the
customers, suppliers or employees of the Company or
with any authorities supervising the Company;
(iii) any destruction or loss of or damage to any
significant property of the Company whether or not
covered by insurance;
(iv) any additional long term debt or any additional
current liability, except in the Ordinary Course of
Business, incurred by the Company;
(v) any agreement or transaction for the sale or
acquisition of any significant assets by the Company
except in the Ordinary Course of Business;
(vi) any change in the accounting systems, policies,
principles or practices of the Company or material
change in the financial condition of the Company;
(vii) any distribution by the Company of dividends or other
distribution of any assets to its shareholder;
(viii) any other action, contract or transaction by the
Company that could have a material adverse effect on
the assets or financial conditions of the Company;
[ix] any salary increase not mandatorily set forth by the
applicable national collective bargaining agreement,
nor any increase of any consultant or directors fees.
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6.15 TAX WARRANTIES
(a) The Company has filed with the appropriate tax authorities all
tax returns and reports in respect of any and all Taxes
required to be filed with such tax authorities and provision
in full has been made for any tax liability in the Accounts
and will, in due course, be made in the Closing Accounts.
(b) The Company has paid to the appropriate tax authorities all
Taxes required to be paid to them. The Company is not in
default in respect of nor will be liable for any Taxes for any
year or part thereof of the Company's taxable years until the
Closing Date.
(c) There are no tax audits currently pending or, to the best
knowledge of Sellers, threatened against the Company.
6.16 PRODUCT WARRANTY AND LIABILITY
No claims in respect of any product, manufactured or sold or any
service delivered by the Company is unsettled or is subject to any
dispute between the Company and any third party.
6.17 COMPETITION PRACTICES AND COMPETITION CLAUSES
(a) The Company is not bound by any non-competition undertakings
or other contractual restrictions, limitations or conditions
on the type or scope of the Business.
(b) There are no pending or, to the best knowledge of Sellers,
threatened proceedings or investigations regarding unfair
competition practices of the Company and all agreements,
practices and alike are in accordance with all applicable
competition laws and regulations and have been notified to the
relevant competition authorities when so required.
6.18 LEGAL AND OTHER COSTS
The Sellers shall bear its own fees and expenses in connection with the
preparation for and completion of the transactions contemplated hereby,
including but not limited to all fees and expenses of agents, brokers,
investment bankers, advisers, representatives, counsels and
accountants, and the Sellers shall not, directly or indirectly, charge
the Company, or otherwise seek reimbursement from the Company, for said
fees and expenses.
6.19 COMPUTER PROGRAMS
The computer equipment and the computer software programs used by the
Company are the unencumbered property of the Company and are fit and
sufficient for the purpose for which they are being used and provide
sufficient processing and storage capacity for the Business and the
Company will following the Closing be able to continue the use of said
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computer equipment and software free from any restrictions and without
incurring any additional costs.
6.20 NO UNDISCLOSED LIABILITIES
There are and will be no liabilities of the Company, whether existing,
future, contingent or otherwise, which relate to any fact, occurrence
or event before the Closing and which will not be reflected in full in
the Closing Accounts.
6.21 NATURE OF DISCLOSURE
Neither the Warranties nor any certificates or documents furnished or
to be furnished to the Purchaser by the Sellers or the Company, contain
or will contain any untrue statement of a material fact or omit to
state any material fact necessary to make the statements therein, in
the light of the circumstances in which they are made, not misleading.
There is no fact known to the Sellers which may now or in the future
materially and adversely affect the Business or the operations of the
Company as contemplated in the material heretofore disclosed by the
Sellers to the Purchaser.
6.22 OVERDRAFT FACILITIES
As of June 29, 1998 the Company has used the bank overdraft facilities
according to the extent indicated in SCHEDULE 6.22.
7. REPRESENTATIONS, WARRANTIES AND ASSURANCES OF THE PURCHASER
The Purchaser hereby represents, warrants and assures
(i) that it is duly organized, validly existing and in good
standing in the jurisdiction of its incorporation; and
(ii) that all corporate action of the Purchaser required for the
lawful and valid consummation of the transactions contemplated
herein have been duly taken; and
(iii) that the Purchaser has the authority to execute, deliver and
perform this Agreement.
8. INDEMNITY
8.1 INDEMNITY OF THE SELLERS
If any of the Sellers are in breach of any of the Warranties
contained in Section 6. hereof or of any other provision contained
herein, the Sellers, jointly and severally, shall indemnify and hold
the Purchaser harmless for a period of twelve (12) months against all
damage, loss, liability or expense (including, without limitation,
reasonable expenses of investigation and attorneys' fees).
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No claim shall be made by Purchaser under this indemnification against
any of the Sellers until the aggregate claims hereunder exceed USD
45,000; provided, however, that in the event that the aggregate amount
of such claims exceeds USD 45,000 then Purchaser shall have the right
to recover hereunder for the full amount of such claim; and further
provided that this sentence shall not limit the recourse of Purchaser
under the Escrow described in Section 3.1 (d) which is available
regardless of any threshold except that amounts recovered thereunder
with respect to any claim shall be credited against any amount
recovered hereunder with respect to such claim. The indemnity
obligation shall in any case not exceed the aggregate amount of ITL
800,000,000 (eight hundred millions Italian Lira). The aforementioned
limitation to the indemnity obligation of Sellers hall in any event not
apply to breach of the representations and warranties contained in
Articles 6.3.
The indemnification shall occur in accordance with the following
provisions:
(a) The amount for which the Purchaser is entitled to be
indemnified hereunder shall be the full amount of the damage,
loss, liability or expense suffered by the Company and/or the
Purchaser as a result of the breach of the Warranties.
(b) Any damage, loss, liability or expense for which the Purchaser
is entitled to be indemnified hereunder shall be treated as a
reduction of the Purchase Price and shall be settled primarily
by way of deduction from any portion of the Purchase Price
that remains unpaid and to the extent any such damage, loss,
liability or expense cannot be satisfied out of such unpaid
part of the Purchase Price, the Sellers agree to reimburse the
Purchaser in cash promptly on request.
(c) Upon any payment in full to Purchaser by the Sellers pursuant
to the provisions of this Section 8., and not prior to the
payment in full, Sellers shall be subrogated to all rights to
reimbursement or indemnification against third parties
relating to the amount so paid. The Parties agree that they
will take all such steps as may be necessary or appropriate to
effect such subrogation.
(d) Any payment to be made by the Sellers under this Section 8.
will carry interest at the lesser of the maximum rate
permitted by applicable or ten per cent (10%) per annum, from
the date on which the Company and/or Purchaser defrayed said
disbursement until the date of payment.
9. ADDITIONAL AGREEMENTS
9.1 RELATED AGREEMENTS
The Sellers and the Purchaser agree to cause the following agreements
(the "Related Agreements") to be entered into before and as a condition
for Closing by the respective parties thereto:
(a) Consultancy Agreement between the Company and XX.XX S.a.s. di
Xxxxxxxxx Xxxxx;
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(b) Consultancy Agreement between the Company and RATIO S.a.s. di
Xxxxxxx Xxxxxxx;
(c) Consultancy Agreement between the Company and INFO.TRC di
Xxxxxxxx Xxxxxxxx;
(d) Escrow Agreement;
(e) Investor Representations/Accredited Investor Questionnaire;
(f) General Release;
(g) Registration Rights Agreement;
(f) Affiliate Agreement.
9.2 NON-COMPETITION AND SECRECY
(a) The Sellers each hereby undertake for a period of one (1) year
from the Closing Date not, without the written consent of the
Purchaser, in the territory of Italy, including without
limitation, San Marino, and Vatican City to directly or
indirectly engage in, assist or have any active interest in,
own any assets or shares in or act as an agent or as an
advisor or consultant to any person, corporation or business
entity, which is or is about to become engaged in any business
competing with the Business. The foregoing agreement is in
addition to any agreements contained in any Consultancy
Agreement between a Seller and the Company.
(b) The Sellers hereby undertakes at any time whether before or
after the Closing Date not without the written consent of the
Purchaser to divulge or use, whether directly or indirectly,
for its own benefit or for the benefit of any person,
corporation or business entity other than the Purchaser or the
Company, as the case may be, any information or knowledge
concerning the operations of the Company, not in the public
domain or generally known.
(c) In case of any breach of the non-competition obligation
contained in Section 9.2 (a), which breach has not been
remedied within sixty (60) days from the receipt of a written
notice thereof, the Sellers agree to pay to the Purchaser
immediately at request by means of liquidated damages an
amount of Four Hundred Million Italian lira (400,000,000 lira)
or an amount corresponding to the aggregate sales of any
products or services in violation of Section 9.2 (a),
whichever is higher. Where the actual damages suffered by the
Purchaser or the Company as a result of such breach are
greater than the amount of liquidated damages, the Purchaser
is entitled to receive compensation for the full amount of
damages so suffered.
9.3 INTER COMPANY LIABILITIES
The Sellers shall cause any and all loans, guarantees or undertakings
given by the Company to or in favour of the Sellers and/or any other
company belonging to the
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Sellers's group of companies to be repaid or released, as the case may
be, with effect from the Closing Date.
10. MISCELLANEOUS
10.1 NOTICES
All notices, demands or other communication, which all shall be in the
English language, to or upon the respective Parties hereto shall be
deemed to have been duly given or made when delivered by mail, telefax
or cable to the Party in question as follows:
If to the Sellers:
address: Xxx Xxxxxxx, 00 - Xxx X/0
Xxxxxxxx x/X
00000 Xxxxxx - Xxxxx
telefax: 011-39-2-92.14.16.44
attention: Xxxxxxxxx Xxxxx, Managing Director
with copy to: Xxxxx - Xxxxxxxx, Montinari e Savi
address: Xxx Xxxxxxxxxxxxxx 00, Xxxxx
telefax: 0039 02 783091
attention: Xx. Xxxxxxxx Xxxxxxx Xxxxx Xxxxxxx
If to the Purchaser:
address: 0000 Xxxxxxx Xxxxxx
Xxxxx Xxxxx, Xxxxxxxxxx XXX 00000
telefax: 000-000-0000
attention: Xxxxxxx Xxxxxxxxx, Vice President
with copy to: Network Associates, Inc.
address: 0000 XxXxxx Xxxx, 0xx Xxxxx
Xxxxxx, Xxxxx XXX 00000
telefax: 000-000-0000
attention: Xxxx X. Xxxxxxx
or at such other address as the respective Party hereto may hereafter
specify in writing to the other Party.
10.2 SCHEDULES INCORPORATED
Each Schedule to which reference is made herein and which is attached
hereto shall be deemed to be incorporated in this Agreement by such
reference.
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10.3 HEADINGS
The headings of this Agreement are for convenience of reference only
and shall not in any way limit or affect the meaning or interpretation
of the provisions of this Agreement.
10.4 ASSIGNMENT
This Agreement and the rights and obligations specified herein shall be
binding upon and inure to the benefit of the Parties hereto and shall
not be assignable by either Party hereto except, in the case of the
Purchaser, to any directly or indirectly owned subsidiary or to any
other company belonging to the same group of companies provided,
however, that the Purchaser shall remain liable for the payment of the
Purchase Price as provided hereunder.
10.5 INTEGRATION
This Agreement represents the entire understanding and agreement
between the Parties with respect to the subject matter hereof and
supersedes all prior negotiations, understandings and agreements
relating to the subject matter hereof.
10.6 NO WAIVER
Failure by any Party at any time or times to require performance of any
provisions of this Agreement shall in no manner affect its right to
enforce the same, and the waiver by any Party of any breach of any
provision of this Agreement shall not be construed to be a waiver by
such Party of any succeeding breach of such provision or waiver by such
Party of any breach of any other provision hereof.
10.7 STAMP DUTY - NOTARY FEES
The stamp duty levied on the purchase of the Shares as well as the
notary fees incident to the closing of this agreement shall be borne by
the Purchaser.
10.8 GOVERNING LAW
This Agreement shall be governed by and construed in accordance with
the laws of Italy.
10.9 ARBITRATION
Any dispute, controversy or claim arising out of or relating to this
Agreement or the breach, termination or invalidity thereof shall be
finally settled by arbitration in accordance with the International
Rules of the National and International Arbitration Chamber of Milan,
which the parties acknowledge to know and accept. The selection of the
arbitrators shall be in accordance with such rules, except as set forth
in Article 3.3 (c). The arbitration shall be held in Milan and the
arbitration proceedings shall be conducted in the language the
arbitrators will choose as most appropriate.
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10.10 AMENDMENTS
Any amendments to this Agreement shall be in writing and shall have no
effect before signed by the duly authorized representatives of both
Parties.
10.11 PROVISIONS SEVERABLE
If any part of this Agreement is held to be invalid or unenforceable
such determination shall not invalidate any other provision of this
Agreement; however, the Parties hereto shall attempt, through
negotiations in good faith, to replace any part of this Agreement so
held to be invalid or unenforceable. The failure of the Parties to
reach an agreement on a replacement provision shall not affect the
validity of the remaining part of this Agreement.
10.12 PUBLICITY
Save as required for the payment of stamp duty or otherwise by law,
governmental decree, applicable stock exchange rules, any other
applicable regulations or any official action, the contents of this
Agreement, except for the transfer of the title to the Shares from the
Sellers to the Purchaser, shall remain secret indefinitely. All press
releases and other public relations activities of the Parties with
regard to the transfer of the Shares shall be mutually approved by the
Purchaser and the Sellers in advance.
10.13 COUNTERPARTS OF THE AGREEMENT
This Agreement has been executed in three (3) identical counterparts,
one (1) for the Purchaser, one (1) for the Sellers and one (1) for the
Company.
10.14 Purchaser shall take any reasonable effort to have Sellers released by
the guarantee obligation under the personal guarantees listed in
SCHEDULE 10.14. Accordingly Purchaser shall hold harmless Sellers from
any claims thereunder caused by actions taken by Purchaser or Company's
Management after Closing.
IN WITNESS WHEREOF, the Parties hereto have duly executed this Agreement as of
the day and year first above written.
FSA NA COMBINATIONCORPORATION
By: Xx. Xxxx Xxxxxxxx
Title: Attorney in fact
Signature:
Xxxxxxxxx Xxxxx
Xxxxxxx Xxxxxxx
Xxxxxxxx Xxxxxxxx
