1
EXHIBIT 2.2
SHARE PURCHASE AGREEMENT
THIS SHARE PURCHASE AGREEMENT, entered into on this 27 day of February, 1998, by
and among Xxxxx Xxxxxxxx, a Finnish national residing in Vantaa and Jarmo
Rouvinen, a Finnish national residing Helsinki (the "Sellers") and FSA
Combination Corp., a corporation organized and existing under the laws of
Delaware, United States of America (the "Purchaser"). The Purchaser is a one
hundred per cent (100%) subsidiary of Network Associates, Inc. ("NAI"), a
corporation organized and existing under the laws of Delaware, United States of
America.
WITNESSETH:
WHEREAS, the Sellers in the aggregate own one hundred per cent (100%) of the
issued and outstanding shares in Nordic Lan Tools Oy, a Finnish company engaged
in the business of the import and sale of EDP-hardware and software as well as
the consulting, training and programming related to EDP, having its registered
office in Vantaa, Finland (the "Company");
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.
2
2
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 audited profit and loss
statement and balance sheet of the Company
including the notes thereto as at the Accounts
Date, together with the accompanying manage-
ment's report as well as the auditors' statutory
report, attached hereto as SCHEDULE 1.1.
1.2 "ACCOUNTS DATE" shall mean 31 December 1997.
1.3 "AGREEMENT" shall mean this Share Purchase Agreement and the
Schedules hereto.
1.4 "ACCOUNTING Shall mean the accounting principles in accordance
PRINCIPLES" with applicable Finnish laws and generally applied
Finnish accounting standards, as consistently
applied by the Company.
1.5 "BUSINESS" shall mean the business of import and sale of
EDP-hardware and software as well as consulting,
training and programming related to EDP as
presently carried out by the Company, including
the assets and rights of whatever nature, relating
to such business.
3
3
1.6 "CLOSING" shall mean the consummation of the transaction as
contemplated in Section 5.
1.7 "CLOSING DATE" shall mean 27 February, 1998 or such later date as
specified in Section 5.1.
1.8 "COMPANY" shall mean Nordic Lan Tools Oy, a Finnish com-
pany entered in the Trade Register under No.
536.650.
1.9 "DISCLOSURE LETTER" shall mean the Disclosure Letter of even date
herewith referred to in Section 6.
1.10 "NET ASSET VALUE" shall mean the difference in the aggregate value
of the assets and the liabilities of the Company
calculated on the basis of the Accounts and
determined as provided in Section 3.3.
1.11 "ORDINARY COURSE OF shall mean the ordinary course of business of the
BUSINESS" Company consistent with past customer and business
practices and always in accordance with good and
sound business practice.
1.12 "PARTY" shall mean the Purchaser or the Seller, 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.
4
4
1.15. "PURCHASER'S shall mean CPA Lars Blomqvist of Coopers &
ACCOUNTANTS Xxxxxxx Oy.
1.16 "RELATED shall mean the agreements referred to in Section
AGREEMENTS" 9.1.
1.17 "SELLERS" shall have the meaning as set out in the
introductory paragraph hereof. Xx. Xxxxx Xxxxxxxx
is the owner of fifty-seven per cent (57%) and
Mr. Jarmo, Rouvinen of forty-three per cent (43%)
of the issued and outstanding shares of the
Company.
1.18 "SHARES" shall mean the shares to be transferred by the
Sellers to the Purchaser as contemplated herein,
representing all of the issued and outstanding
shares of the Company, each such share with a
nominal value of FIM 100.
1.19 "SHARE TRANSFER shall mean the agreement referred to in Section
AGREEMENT" 5.4(d).
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 Company as represented by
the Shares as of the Closing Date.
5
5
3. PURCHASE AND SALE OF COMPANY SHARES
3.1 PURCHASE PRICE
(a) The purchase price for the Shares (the "Purchase Price", subject to
Section 3.2, shall be US dollars one million eight hundred thousand
(USD 1,800,000).
(b) The Purchase Price shall be paid at the Closing 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:
Xxxxx Xxxxxxxx: fifty-seven per cent (57%) of the NAI-Shares.
Jarmo Rouvinen: forty-three per cent (43%) of the NAI-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 average 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.
(d) At the Closing, from the NAI-Shares otherwise deliverable pursuant
to this Section 3.1, Purchaser shall deposit a number of 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).
(e) The Purchaser has informed the Sellers of the tradeability of the
NAI-Shares as provided for in SCHEDULE 3.1(e).
6
6
3.2 NET ASSET VALUE
The Purchase Price shall be adjusted on a dollar to dollar basis to the
extent the Net Asset Value calculated as provided in Section 3.3. is less
than five hundred thousand US Dollars (USD 500,000).
3.3. ACCOUNTS AND DETERMINATION OF NET ASSET VALUE
(a) As promptly as practicable after the signing of this Agreement and
no later than 20 days following the Closing Date, the Sellers shall
prepare and deliver to the Purchaser and the Purchaser's Accountants
calculation of the Net Asset Value.
(b) The Purchaser's Accountants shall verify the Accounts and the Net
Asset Value 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 Accounts and/or the Net Asset Value 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
Accounts.
(c) The Purchaser and the Sellers shall in good faith endeavour to
resolve any dispute under Section 3.3 (c) 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
resolved according to Section 10.9 hereunder.
(d) Any adjustment of the Purchase Price based on a shortfall of the Net
Asset Value shall carry interest at the rate of ten per cent (10%)
p.a. from the Closing Date until the date of actual payment.
7
7
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 fulfillment 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 15.00 p.m. at
the offices of Messrs Xxxxxxxx-Xxxxxxxx & Waselius, Xxxxxxxxxx 0 X,
Xxxxxxxx.
5.2 PURCHASER'S CONDITIONS PRECEDENT
The obligation of the Purchaser to close hereunder shall be subject to the
fulfillment, 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) Warranties True and Sellers' Certificate
The representations, warranties and assurances given by the Sellers in
Section 6. shall be true and correct on and as of the Closing Date with
the same effect as though such representation, warranties and assurances
had been made on
8
8
and as of such date and Sellers shall have delivered to the Purchaser a
certificate, dated at the Closing Date, to such effect.
(c) 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 appointed by the Purchaser.
(d) 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 Finland, the United States, the European Union or
elsewhere, as the case may be, required for the lawful and valid
consummation of the transactions contemplated hereunder.
(e) Board Approval
The consummation of the transactions contemplated hereby shall have been
approved by the Board of Directors of the Purchaser.
(f) Corporate Action
All corporate action necessary for the lawful and valid consummation of
the transactions contemplated hereby shall have been duly taken by the
Company and shall be in full force and effect.
(g) 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.
9
9
(h) The Company shall have been released from all guarantees and other
undertakings referred to in Section 9.3.
(i) The Purchaser and NAI believe that, based on consultation with its
independent accountants and in the light of the financial due diligence
performed in the Company, that the transactions contemplated in this
Agreement and the Related Agreements can be accounted for as a pooling of
interests pursuant to US GAAP.
5.3 SELLERS' 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.
10
10
(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 Finland, the United States, 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 and release and deliver to the Purchaser the share
certificates corresponding to the Shares duly endorsed in blank in a
manner provided for in 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;
(b) the Sellers shall convey to the Purchaser the share and
shareholders' registers of the Company;
(c) the Purchaser shall deliver to each of the Sellers the consideration
as referred to in Section 3.1(b), less any reduction to the Purchase
Price pursuant to Section 3.2, to the extent known as of the Closing
Date in a manner provided for in SCHEDULE 5.4(a);
11
11
(d) the Parties shall execute the Share Transfer Agreement effecting the
transfer of the Shares, in the form set forth 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.
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.
The liability of the Sellers under, and the rights and remedies of the
Purchaser in respect of, the Warranties shall not be affected by any
knowledge of the Purchaser as a result of the Purchaser's examination of
the Company or otherwise, but only the facts, matters, occurrences or
events disclosed by the Sellers in the Disclosure Letter attached hereto
as SCHEDULE 6. shall constitute exceptions to the Warranties for which the
Sellers are not liable. Accordingly, the Sellers shall not be deemed to be
in breach of the Warranties only to the extent a fact, matter, occurrence
or event has been specifically disclosed to the Purchaser in the
Disclosure Letter.
12
12
6.1 ORGANIZATION, GOOD STANDING
The Company is a corporation duly organized, validly existing and in good
standing under the laws of Finland, 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 filed its annual reports with the relevant
authorities, as required and the information set forth therein is
true, accurate and complete.
(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, 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 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
13
13
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
fulfillment of the terms hereof, will not result in a breach of any
judgement, decree or order of any court or governmental body, any
applicable law or the Articles of Association of 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. There are no outstanding obligations, warrants,
options, depository receipts, 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.
(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 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 Accounts Date and have
been prepared in conformity with the Accounting Principles.
In particular, the Accounts 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 premiums, taxes, pension, retirement or similar obligations);
they do not overstate
14
14
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 has exclusive title to the assets recorded in the
Accounts except for such assets which 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 including work in
progress, are within specifications and of merchantable quality. In
addition to what will be properly accrued and accounted for in the
Closing Accounts, there are no obsolete or slow moving inventories.
(d) The present use of the building used by the Company is not
restricted by any material restriction or condition and conform to,
fire and safety regulations, 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.
15
15
There is no material physical defect in any part of the properties or any
structure thereon and all structures thereon are in good and substantial
repair and condition and fit for the purpose for which they are currently
used having regard to their age and normal wear and tear.
6.6 INTELLECTUAL PROPERTY
(a) The Company owns all intellectual property (the "Intellectual
Property") necessary to manufacture the products presently
manufactured and produce the services presently produced, and to
distribute and sell such products and services in any country where
business presently is conducted.
(b) 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
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.
(c) 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.
(d) No employee of the Company is employed in violation of any
non-disclosure or non-competition agreement.
16
16
6.7 ACCOUNTS RECEIVABLE
All of the receivables of the Company are good and fully collectible
within ninety (90) 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 condition 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.
6.10 INSURANCE
Attached hereto as SCHEDULE 6.10 are true and complete copies of all the
insurance policies, currently in effect in respect of the Business and the
Assets (the "Insurance Policies"). The Insurance Policies of the Company
provide the types and amounts of insurance coverage normal and customary
for similar companies in Finland.
17
17
6.11 AGREEMENTS, CONTRACTS AND COMMITMENTS
(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 other than
those listed in SCHEDULE 6.11(a)(i), copies of which have been
made available to the Purchaser;
(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;
(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) other than those listed
in SCHEDULE 6.11(a)(v).
(b) All agreements or contracts to which the Company is a party are
valid, binding and enforceable in accordance with their respective
terms. 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. The execution
18
18
and the delivery of this Agreement and the Related Agreements nor
the consummation of the transactions contemplated hereby will not
conflict with, result in breach of, constitute a default under or
result in the acceleration of, terminate, modify or cancel or
require any notice under any agreement or other arrangement to which
the Company is bound to.
6.12 EMPLOYMENT AND PENSION AGREEMENTS
(a) A true, complete and current list of all employments of the Company
and 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.
(b) No employee 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 or pension
undertakings to be paid to current or former directors, officers or
other employees of the Company.
(d) The Company has not received notice, which notice remains current,
of any claim that it has not complied with any employment, labour or
related laws.
(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.
(f) There are no pending or current and no threatened claims or labour
litigation in respect of the Company. No negotiations are required
to be
19
19
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.
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 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 deviation by the Company from the Ordinary Course of
Business;
(ii) any adverse change in the financial conditions, assets,
liabilities or prospects of the Company;
(iii) any adverse change in the relationship with the customers,
suppliers or employees of the Company or with any authorities
supervising the Company;
20
20
(iv) any destruction or loss of or damage to any property of the
Company whether or not covered by insurance,
(v) any additional debt or any additional current liability,
except in the Ordinary Course of Business, incurred by the
Company;
(vi) any agreement or transaction for the sale or acquisition of
any assets by the Company except in the Ordinary Course of
Business,
(vii) any change in the accounting systems, policies, principles or
practices of the Company or any deviation from the Accounting
Principles,
(viii) any distribution by the Company of dividends or other
distribution of any assets to its shareholder,
(ix) 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.
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.
21
21
(c) There are no tax audits currently pending or 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 and no claims will be made by any third
party with respect to any product manufactured or sold or service
delivered before the Closing.
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 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 their 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,
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. The Company
shall not be liable to pay any broker fees.
22
22
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
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.
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;
and
23
23
(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 BY THE SELLERS
If the Sellers are in breach of any of the Warranties contained in Section
6. hereof or of any other provision contained herein, the Seller shall
indemnify and hold the Purchaser harmless against all damage, loss,
liability or expense (including, without limitation, reasonable expenses
of investigation and attorneys' fees), all 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 from the
Purchase Price that remains in escrow and to the extent any such
damage, loss, liability or expense cannot be satisfied out of such
deposited part of the Purchase Price, the Sellers agree to reimburse
the Purchaser in cash promptly on request.
(c) To the extent that the Sellers are in breach of the Warranties
contained in Section 6.7 hereof, the Sellers shall forthwith pay to
or as directed by the Purchaser the amount of the respective
receivable(s) together with interest thereon, against transfer of
the relevant receivable(s) to the
24
24
Sellers. The Parties shall procure that the Company, before the
assignment of the relevant receivable(s), shall endeavour to collect
such receivables itself in accordance with the customary business
practice of the Company.
(d) Notwithstanding the above, the Purchaser shall not be entitled to
damages unless the aggregate amount of its claims amounts to at
least USD 25,000. In case said amount is exceeded, the Purchaser
shall be indemnified for all damages, losses, liabilities and
expenses including any amounts below USD 25,000.
(e) Upon any payment by the Sellers pursuant to the provisions of this
Section 8., it 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.
(f) Any payment to be made by the Sellers under this Section 8. will
carry interest at ten per cent (10%) per annum from the Closing
Date until the date of payment.
8.2 RIGHT TO SET-OFF
The Purchaser and/or the Company shall have the right to set-off any claim
they or any of them may have towards the Sellers under this Agreement or
the Related Agreements against any claim the Sellers may have towards the
Purchaser and/or the Company under the Related Agreements or any other
agreements or arrangements.
25
25
9. ADDITIONAL AGREEMENTS
9.1 RELATED AGREEMENTS
The Seller 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) Employment Agreement between the Company and Xx. Xxxx Karlsson as
set forth in SCHEDULE 9.1(a);
(b) Employment Agreement between the Company and Xx. Xxxxx Xxxxxxxx as
set forth in SCHEDULE 9.1(b);
(c) Accredited Investor Questionnaire as set forth in SCHEDULE 9.1(c);
(d) General Release as set forth in SCHEDULE 9.1(d);
(e) Affiliate Agreement as set forth in SCHEDULE 9.1(e);
(f) Investor Representation Certificate as set forth in SCHEDULE 9.1(f);
(g) Registration Rights Agreement as set forth in SCHEDULE 9.1(g).
9.2 NON-COMPETITION AND SECRECY
(a) The Sellers hereby undertake for a period of one (1) year from the
Closing Date not, without the written consent of the Purchaser, 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. In addition to the provisions contained in this
non-competition clause,
26
26
(b) The Sellers hereby undertake 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 Seller
in breach agrees to pay to the Purchaser immediately at request by
means of liquidated damages an amount of one million Finnish marks
(FIM 1,000,000) 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 LIABILITIES TO RELATED PERSONS OR COMPANIES
The Sellers shall cause any and all loans, guarantees or undertakings
given by the Company to or in favour the Sellers and/or their family
members or Nordic Lantools AB 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
27
27
been duly given or made when delivered by mail, telefax or cable to the
Party in question as follows:
If to the Purchaser:
address: Network Associates, Inc.
0000 Xxxxxx Xxxxxx
Xxxxx Xxxxx, Xxxxxxxxxx 00000
telefax: x0-000-000 3063
attention: Xx. Xxxxxxx Xxxxxxxxx
with copy to: Xxxxxxxx-Xxxxxxxx & Waselius
address: Xxxxxxxxxx 0 X
00000 Xxxxxxxx
telefax: x000-0-000 303
attention: Xx. Xxx Xxxxxxx
If to the Sellers:
Xx. Xxxxx Xxxxxxxx
address: Prinssintie 8 as 1
01260 Vantaa
Xx. Xxxxx Xxxxxxxx
address: Xxxxxxxx 0X
00000 Xxxxxxxx
with copy to: Asianajotoimisto Jyri Sarpaniemi
address: Xxxxxxxxx 0
00000, Xxxxxxxx
telefax: x000-0-000 5059
attention: Mr. Jyri Sarpaniemi
28
28
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.
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,
29
29
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
The stamp duty levied on the purchase of the Shares shall be borne by the
Purchaser.
10.8 GOVERNING LAW
This Agreement shall be governed by and construed in accordance with the
laws of Finland.
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 Arbitration Rules of
the Finnish Central Chamber of Commerce. The arbitration shall be held in
Helsinki and the arbitration proceedings shall be conducted in the English
language. The arbitral tribunal shall consist of one arbitrator.
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
30
30
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 Seller 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 Seller in
advance.
10.13 SURVIVAL
The representations and warranties in this Agreement or in any instrument
delivered pursuant to this Agreement shall survive the Closing
indefinitely.
10.14 COUNTERPARTS OF THE AGREEMENT
This Agreement has been executed in four (4) identical counterparts, one
(1) for the Purchaser, two (2) for the Sellers and one (1) for the
Company.
IN WITNESS WHEREOF, the Parties hereto have duly executed this Agreement as of
the day and year first above written.
/s/ XXXXX XXXXXXXX /s/ JARMO ROUVINEN
----------------------------------- -------------------------------------
Xxxxx Xxxxxxxx Jarmo Rouvinen
FSA Combination Corp.
[SIG]
-------------------------------
