259
ASSET PURCHASE AND SETTLEMENT AGREEMENT
This Asset Purchase and Settlement Agreement (this "Agreement") is made as
of February 28, 1997 by and among Palomar Medical Technologies, Inc., a Delaware
corporation ("Palomar"), Nexar Technologies, Inc., a Delaware corporation which
is a majority owned subsidiary of Palomar ("Nexar"), Technovation Computer Labs,
Inc., a Nevada corporation ("Seller"), and ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇.
W I T N E S S E T H:
WHEREAS, ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇ has conceived, developed, authored, made or
otherwise acquired or asserted ownership of technology, proprietary information
and/or intellectual property for facilitating the installation, replacement or
upgrading of personal computer components, such technology, proprietary
information and/or intellectual property including but not limited to United
States Patent Application Serial No. 08/409,317, filed on 3/23/95, entitled
"System Permitting the External Replacement of the CPU and/or DRAM ▇▇▇▇▇
Microchip Board" and further including but not limited to an "additional" patent
application on Hamirani's behalf, as referred to in a letter dated December 19,
1996, from Hamirani's counsel, Law Offices of ▇▇▇ ▇. ▇▇▇▇▇▇▇▇, to ▇▇. ▇▇▇▇▇▇ ▇.
▇▇▇▇▇▇▇▇▇;
WHEREAS, Nexar contends that it has been assigned certain techn logy,
proprietary information and/or intellectual property of ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇ in
accord with a Key Employment Agreement executed by him on or about August 1,
1995 (the "Employment Agreement"); ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇ contends otherwise;
WHEREAS, Nexar contends that ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇ was the holder of certain
rights to options in Palomar Electronics Corporation, a subsidiary of Palomar,
which rights lapsed unvested upon ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇'▇ termination of employment
on November 29, 1996; ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇ contends otherwise;
WHEREAS, ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇ contends that he is the holder of certain rights
to options in Nexar and/or Palomar Electronics Corporation; Nexar and Palomar
contend otherwise;
WHEREAS, Seller is the owner of assets including all technology,
proprietary information and/or intellectual property licensed to Nexar under the
License Agreement between the parties dated August 25, 1995 (the "License
Agreement"), and including technology, proprietary information and/or
intellectual property acquired from ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇;
WHEREAS, Seller and ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇ desire to sell, and Palomar desires
to buy, all of the existing technology, proprietary information and/or
intellectual property of Seller and ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇ pertaining to technologies
intended to facilitate the installation, replacement and upgrading of personal
computers, including without limitation all of the technology,
260
proprietary information and/or intellectual property licensed to Nexar under the
License Agreement, or otherwise owned by Seller;
WHEREAS, ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇'▇ employment with Nexar was terminated on
November 29, 1996 and ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇ has raised certain issues in connection
with such termination;
WHEREAS, the parties wish to settle for all time all known and unknown
claims relating to ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇'▇ termination, the License Agreement, the
Employment Agreement, including ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇'▇ options claims, and further
wish to effect a sale of technology, proprietary information and intellectual
property described below by Seller and ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇ to Palomar;
WHEREAS, ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇ is a principal of Amerisel, Inc, a California
corporation (d/b/a Computer Universe) ("Computer Universe"), which Nexar
contends is indebted to it in the approximate amount of $271,000 for goods sold
by Nexar, and Nexar is willing to forgive such indebtedness in consideration of
the mutual covenants and obligations of the parties to this Agreement and for
mutual releases between Nexar and Computer Universe;
NOW, THEREFORE, in consideration of the mutual covenants, representations
and warranties hereinafter set forth, the parties hereby agree as follows:
ARTICLE I
PURCHASE AND SALE OF ASSETS
1.0 Definitions. As used in this Agreement, the term "▇▇▇▇▇▇▇▇" refers to
▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇. As used in this Agreement, the term "affiliates" refers to
those persons listed on Exhibit 1.0 hereto.
1.1 Purchased Assets. Subject to the terms and conditions of this
Agreement, at the Closing (as defined in Section 1.4) Seller and ▇▇▇▇▇▇▇▇ shall
sell, convey, transfer, assign and deliver to Palomar, and Palomar shall
purchase, all right, title and interest in the assets defined below
(collectively, the "Purchased Assets"):
(i) Technology. The Purchased Assets shall include all right, title
and interest in the following technology, proprietary information, and
intellectual property (collectively, the "Technology"):
(a) ISPA and XPA. All right, title and interest in any invention,
modification, or advance (whether or not patentable) created,
developed, realized, acquired, owned, conceived or made by or on
behalf of Seller or ▇▇▇▇▇▇▇▇ (independently or with others), or in
which Seller or ▇▇▇▇▇▇▇▇ have a legal or equitable right of ownership,
through the Closing Date (as defined in Section 1.4), pertaining to
technologies intended to facilitate
261
the installation, replacement, and/or upgrading of personal computer
components (including, by way of non-limiting example, technologies
sometimes referred to as "Inverted Socket Processor Architecture,"
"ISPA," "ISPA 1," "ISPA 2," "ISPA 3," "Cross Processor Architecture,"
and/or "XPA");
(b) Patents and Applications. All right, title and interest in
all patents and patent applications owned by, acquired by, issued to,
naming, filed by or on behalf of, Seller or ▇▇▇▇▇▇▇▇, or in which
Seller or ▇▇▇▇▇▇▇▇ have a legal or equitable right of ownership,
through the Closing Date, disclosing or claiming any invention,
modification, or advance referred to in Section 1.1(i)(a); any further
applications claiming a right of priority from such patents or patent
applications (including, without limitation, any divisional,
continuation, continuation-in-part, or convention applications); and
any patents issuing on any such applications; any reissue,
reexamination or extension of any such patents; such patents and
applications including, by way of non-limiting example, United States
Patent Application Serial No. 08/409,317, filed on 3/23/95, entitled
"System Permitting the External Replacement of the CPU and/or DRAM
▇▇▇▇▇ Microchip Board" (the "Patent Application") and the
aforementioned "additional" patent application (not yet filed)
referred to in the letter dated December 19, 1996, from Hamirani's
counsel to ▇▇. ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇ (the "Additional Patent
Application");
(c) Copyright. All right, title and interest, if any should
exist, in any works of authorship, copyright applications or copyright
registrations created by, owned by, acquired by, issued to, naming,
filed by or on behalf of, Seller or ▇▇▇▇▇▇▇▇, or in which Seller or
▇▇▇▇▇▇▇▇ have a legal or equitable right of ownership, through the
Closing Date, relating to any invention, modification, advance,
technology, patent, or application referred to in Sections 1.1(i)(a) -
(b) (as used herein and throughout this agreement, "copyright"
includes copyright, moral rights and semiconductor mask work rights);
(d) Trademark. All right, title and interest, if any should
exist, in any trademarks, trademark applications or trademark
registrations, created by, owned by, acquired by, issued to, naming,
filed by or on behalf of, Seller or ▇▇▇▇▇▇▇▇, or in which Seller or
▇▇▇▇▇▇▇▇ have a legal or equitable right of ownership, through the
Closing Date, for use in connection with goods or services relating to
any invention, modification, advance, technology, patent, or
application referred to in Sections 1.1(i)(a) - (b) (including, by way
of non-limiting example, actual or potential trademarks such as
"Inverted Socket Processor Architecture," "ISPA," "ISPA 1," "ISPA 2,"
"ISPA 3," "Cross Processor Architecture," and/or "XPA"), as well as
the goodwill of Seller's or Hamirani's businesses (or that part of the
such goodwill) connected with the use of and symbolized by such
trademarks; in the case of trademarks and trademark applications for
which there is an intent to use, Seller and ▇▇▇▇▇▇▇▇ acknowledge that
assignment of such trademarks and trademark applications is being made
concurrent with the assignment of such businesses or portions thereof
to which those trademarks and trademark applications pertain, which
businesses are ongoing and existing; the term "trademark" as used
herein and throughout this agreement refers to both trademarks and
service marks;
262
(e) Trade Secrets. All right, title and interest, if any should
exist, in any trade secrets and know-how developed, realized,
acquired, owned, or made by or on behalf of Seller or ▇▇▇▇▇▇▇▇
(independently or with others), or in which Seller or ▇▇▇▇▇▇▇▇ have a
legal or equitable right of ownership, through the Closing Date,
relating to any invention, modification, advance, technology, patent,
or application referred to in Sections 1.1(i)(a) - 1.1(i)(b);
(f) Documentation. All right, title and interest, if any should
exist, to any documentation (in whatever form and stored on whatever
medium) created by, owned by, acquired by, issued to, filed by or on
behalf of, Seller or ▇▇▇▇▇▇▇▇, or in which Seller or ▇▇▇▇▇▇▇▇ have a
legal or equitable right of ownership, through the Closing Date,
relating to any invention, modification, advance, technology, patent,
or application referred to in Sections 1.1(i)(a) - 1.1(i)(b); such
documentation including, without limitation, all design and
engineering drawings and specifications (the "Documentation");
(g) Prototypes. All right, title and interest, if any should
exist, to any prototypes, mock-ups, simulations, or other
implementations (whether or not completed or functional) created,
developed, realized, acquired, owned, or made by or on behalf of
Seller or ▇▇▇▇▇▇▇▇ (independently or with others), or in which Seller
or ▇▇▇▇▇▇▇▇ have a legal or equitable right of ownership, through the
Closing Date, relating to any invention, modification, advance,
technology, patent, or application referred to in Sections 1.1(i)(a) -
1.1(i)(b);
(h) Other Seller Assets. All right, title and interest in the
technology, proprietary information and/or intellectual property
licensed to Nexar under the License Agreement, including without
limitation that constituting the "Licensed Technology and Know-How",
"Invention", "Technical Information", "Documentation", "Licensed
Patent Rights", and "Improvement" through the Closing Date;
(ii) Causes of Actions. The Purchased Assets shall also include all
right, title and interest in all causes of action, claims and similar
rights arising under law or contract for assignment or other transfer to
Seller or ▇▇▇▇▇▇▇▇, or for performance of duties on behalf of Seller or
▇▇▇▇▇▇▇▇, relating to any invention, modification, advance, technology,
patent or application therefor, trademark, trademark registration or
application therefore, work of authorship, copyright registration or
application therefor, trade secret or know-how, documentation, prototype
mock-ups, simulations, or other implementations referred to in Sections
1.1(i)(a) -1.1(i)(g) through the Closing Date. In the event Palomar and/or
Nexar pursue a cause of action under this paragraph and Seller and/or
▇▇▇▇▇▇▇▇ are named as parties in any such legal proceeding, then Palomar
and/or Nexar agree to defend and hold Seller and/or ▇▇▇▇▇▇▇▇ harmless
pursuant to paragraph 8.3 below except insofar as such actions are the
result of an act or omission by Seller and/or ▇▇▇▇▇▇▇▇ in contravention of
the purposes and terms of this Agreement.
263
As used in this Section 1.1, the terms patent, patent application,
trademark, trademark application, trademark registration, copyright, copyright
application, copyright registration, and the like, refer to the corresponding
domestic, international, regional and foreign intellectual property rights, if
any should exist. Thus, by way of non-limiting example, the references in
Section 1.1(i)(b) to patents and patent application refers to domestic patents
and patent applications, international patents and patent applications, regional
patents and patent applications, and foreign patents and patent applications.
The purchase and sale transactions described above in this Section 1.1 is
herein referred to as the "Asset Sale."
1.2 No Assumption of Liabilities. Neither Nexar nor Palomar shall assume
any liabilities or obligations of Seller or ▇▇▇▇▇▇▇▇ whatsoever, including,
without limitation, any obligation or liability relating to any of the
agreements included in the Purchased Assets or product warranty, liability or
similar claims relating to products delivered or services performed on or prior
to the date of the Closing or any other claims arising out of actions (or
inaction) or other events initially occurring on or prior to the date of the
Closing. It is agreed that Seller and ▇▇▇▇▇▇▇▇ shall be solely liable for all
liabilities and obligations arising from Seller's or Hamirani's respective
ownership, possession, use or operation of the Purchased Assets, the sale,
licensing or other disposition of the Technology, and other incidents and
occurrences relating to the Purchased Assets during the period on or prior to
the date of the Closing.
1.3. Escrow Agent; Escrow Agreement. Union Bank of California or other
appropriate California financial institution shall serve as Escrow Agent
pursuant to the terms of an Escrow Agreement substantially in the form of
Exhibit 1.3 hereto and to be mutually agreed upon by the parties thereto which
shall be executed at the Closing by the parties hereto and said Escrow Agent.
1.4 The Closing. On the earlier of April 30, 1997 or the closing of the
initial public offering of the common stock of Nexar (the "Closing Date"), (i)
Seller and ▇▇▇▇▇▇▇▇ will deliver to Palomar and Nexar the various certificates,
instruments and documents referred to in Section 6.1, and (ii) Palomar and Nexar
will deliver, or cause to be delivered, to Seller, ▇▇▇▇▇▇▇▇, Computer Universe
and the Escrow Agent, as the case may be, the consideration specified in Section
5.1(b), (c), (d) and (e) and the various instruments and documents referred to
in Section 6.2 (the "Closing"). If the closing of the initial public offering of
the common stock of Nexar occurs before April 30, 1997, then the Closing shall
occur on the same date as the closing of the Nexar initial public offering and
the Closing will be first in time. The Closing shall take place at the offices
of Ropers, Majeski, ▇▇▇▇ & ▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇,
or such other place as agreed to by the parties.
ARTICLE II
REPRESENTATIONS AND WARRANTIES OF SELLER AND ▇▇▇▇▇▇▇▇
264
Seller and ▇▇▇▇▇▇▇▇ each jointly and severally represent and warrant to
Palomar and Nexar that the following are true and complete as of the date
hereof.
2.1 Organization, Standing and Power. Seller is a corporation duly
organized, validly existing and in good standing under the laws of Nevada and
has full corporate power and authority to own, lease and operate its properties
and to carry on its business as now being conducted. Seller is duly qualified
and in good standing as a foreign corporation in California and every other
jurisdiction where the conduct of its business or the character of its
properties requires such qualification, or Seller believes qualification is
unnecessary at this time. Seller has duly obtained all permits, licenses and
other qualifications under all applicable laws, regulations, ordinances or
orders of public authorities, or otherwise, that Seller believes are necessary
to the current conduct of its business. Seller has no subsidiaries and does not
control directly or indirectly or have any direct or indirect equity
participation in any corporation, partnership, trust or other business.
2.2 Authority and Binding Obligation. This Agreement has been duly
authorized, executed and delivered by each of the Seller and ▇▇▇▇▇▇▇▇, and
Seller has the corporate power and authority to enter into and perform the
obligations to be performed by it hereunder, and ▇▇▇▇▇▇▇▇ has the power and
authority to enter into and perform the obligations to be performed by him
hereunder. This Agreement and the Bills of Sale and other instruments of
transfer and agreements of Seller and ▇▇▇▇▇▇▇▇ referred to in Section 6.1
respectively constitute the valid and binding obligations of Seller and
▇▇▇▇▇▇▇▇, enforceable against each in accordance with their respective terms,
except that such enforceability may be limited by bankruptcy, insolvency,
moratorium or other similar laws affecting or relating to enforcement of
creditor's rights generally and is subject to general principles of equity.
2.3 No Consents Necessary. No consents or approvals of or notifications to
any governmental authority or other person not a party hereto is required in
connection with the execution and delivery of this Agreement by Seller and
▇▇▇▇▇▇▇▇ or the performance by Seller and ▇▇▇▇▇▇▇▇ of all of their respective
obligations hereunder.
2.4 No Breach. Neither the execution and delivery of this Agreement nor the
consummation of the transactions contemplated hereby will (a) violate any
provision of the charter or bylaws of Seller or Hamirani's affiliates, or any
material law, regulation, ordinance, judgment or decree applicable to Seller or
▇▇▇▇▇▇▇▇ or any of their respective properties or assets; (b) violate, conflict
with or result in the breach or termination of, or otherwise give any other
contracting party the right to terminate, or constitute (or with notice or lapse
of time, or both, would constitute) a default under the terms of any material
written contract, mortgage, lease, bond, indenture, agreement, franchise or
other instrument or obligation of Seller or ▇▇▇▇▇▇▇▇; or (c) result in the
creation of any lien or encumbrance (collectively, "Liens") upon the Purchased
Assets.
2.5 Intellectual Property.
265
(a) Seller and/or ▇▇▇▇▇▇▇▇ own the Technology in its entirety both
legally and beneficially that is to be sold, conveyed, transferred,
assigned and delivered to Palomar by this Agreement. Seller and/or ▇▇▇▇▇▇▇▇
have not assigned, licensed, transferred or otherwise conveyed any rights
in the Technology to Computer Universe, ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇▇▇▇ or
others.
(b) Seller and/or ▇▇▇▇▇▇▇▇ own legally enforceable rights to make,
use, sell, offer for sale, import, disclose, duplicate, distribute, display
and to prepare derivatives of apparatus, processes, articles of
manufacture, works of authorship and copies in any medium, goods and
services embodying the Technology, subject, prior to the close of business
on the date hereof, only to the terms of the License Agreement.
Exhibit 2.5(a) sets forth a true and complete list of all trademarks,
trademark applications, trademark registrations, patents and patent
applications, copyright applications, copyright registrations, included in the
Technology (collectively, the "Assigned Applications/Registrations"), and
specifies (i) for each such trademark application, trademark registration,
patent application, patent, copyright application, and copyright registration,
the jurisdiction in which it has been filed and/or issued, the date of filing,
the application number, and the registration number (where applicable), and (ii)
for each such trademark, the identity of the ▇▇▇▇, its dates of first use
anywhere and first use in interstate commerce, the goods and/or services with
which it is used, and the jurisdictions in which it has been used.
Exhibit 2.5(b) sets forth a true and complete list of all tangible and
intangible assets, other then the Assigned Applications/Registrations, included
in the Purchased Assets, including without limitation apparatus, articles of
manufacture, prototypes and Documentation or other tangible media, contract
rights, causes of action, claims and similar rights, whether accrued or not.
Exhibit 2.5(c) sets forth a true and complete list of all material
third-party patents, trademarks, copyrights, know-how, proprietary information
or other technology (including software) (the "Third Party Intellectual Property
Rights"), and any other property of third parties which are incorporated in,
are, or form a part of, the Technology. Exhibit 2.5(c) also sets forth a true
and complete list of (i) all material licenses, sublicenses and other agreements
as to which Seller and/or ▇▇▇▇▇▇▇▇ is a party and pursuant to which any person
is authorized to use any of the Technology and/or the Assigned
Applications/Registrations; (ii) all material licenses, sublicenses and other
agreements as to which Seller is a party and pursuant to which Seller and/or
▇▇▇▇▇▇▇▇ is authorized to use any Third Party Intellectual Property Rights
relating to any technology referred to in Section 1.1(i)(a); and (iii) all
material licenses, sublicenses and other agreements as to which Seller and/or
▇▇▇▇▇▇▇▇ is a party and pursuant to which Seller and/or ▇▇▇▇▇▇▇▇ is authorized
to make, use, sell, offer for sale, import, disclose and/or modify any
Technology and/or the Assigned Applications/Registrations.
No claims are currently pending or, to the knowledge of Seller or ▇▇▇▇▇▇▇▇,
threatened by any person or entity, nor do Seller or ▇▇▇▇▇▇▇▇ know of any valid
grounds for any bona fide claims (i) to the effect that the manufacture, use,
sale, offering for sale, import, disclosure,
266
duplication, distribution, display, licensing, assignment, and/or preparation of
derivatives based on any product, process, work of authorship or copy utilizing
the Technology infringes on any copyright, patent, trademark, or trade secret of
a third party; (ii) against the use by Seller or ▇▇▇▇▇▇▇▇ of the any trademarks,
trade names, trade secrets, copyrights, patents, patent applications,
technology, know-how or computer software programs and applications relating to
any technology referred to in Section 1.1(i)(a) used in their respective
businesses as currently conducted; (iii) challenging the ownership, validity or
effectiveness of any of Assigned Applications/Registrations, the Technology,
and/or the Purchased Assets; or (iv) challenging Seller's or Hamirani's license
or legally enforceable right to make use of Third Party Intellectual Rights.
Notwithstanding the above, all parties are aware, as evidenced by Nexar's recent
filings with the Securities and Exchange Commission, that ▇▇▇▇▇▇ ▇. ▇▇▇▇ may
have a threatened claim regarding the subject technology.
To the knowledge of Seller and ▇▇▇▇▇▇▇▇, all patents, patent applications,
trademarks, trademark applications, registered trademarks, copyright
applications, and registered copyrights included in the Technology are valid and
subsisting. To the knowledge of Seller and ▇▇▇▇▇▇▇▇, there is no material
unauthorized use, infringement or misappropriation of any Assigned
Applications/Registrations or the Technology by any third party, including any,
current or former officer, director, stockholder, or employee of Seller or
▇▇▇▇▇▇▇▇. Notwithstanding the above, Seller and/or ▇▇▇▇▇▇▇▇ may have a claim
against GDA for material unauthorized use, infringement or misappropriation of
the Technology in design work for Nexar (all right, title and interest in such
claim, as well as in any related cause of action or similar rights arising under
law or contract, are assigned and transferred to Palomar pursuant to Section
1.1(ii) hereof).
(c) All copies of any source code for software or firmware
constituting part of the Technology are in Seller's and/or Hamirani's
possession and control (and shall be delivered to Palomar upon Closing) and
no officers, employees, agents, outside consulting or contract engineers or
designers or actual or potential customers of Seller, or any other third
party, have any rights to or possess such source code.
(d) There are no licenses or other authorizations not possessed by
Seller or ▇▇▇▇▇▇▇▇ which are required for Palomar and Nexar to utilize,
modify, market and distribute the Technology and Documentation to at least
the same extent as Seller and/or ▇▇▇▇▇▇▇▇ prior to the Closing Date.
(e) Seller and ▇▇▇▇▇▇▇▇ have taken all appropriate actions to protect
the secrecy and confidentiality of the Technology and the non-public
information included in the Documentation. To the knowledge of Seller and
▇▇▇▇▇▇▇▇, the Assigned Applications/Registrations are presently protectable
and are not part of the public domain or literature, nor have they been
used, divulged or appropriated for the benefit of any past or present
employees or other persons, or to the detriment of Seller or ▇▇▇▇▇▇▇▇. All
persons who have been involved in the development of the Technology and
Documentation have executed confidentiality and nondisclosure agreements
covering all non-public information included in the Documentation in the
forms previously delivered to Palomar. Notwithstanding the above, Seller
and/or ▇▇▇▇▇▇▇▇ have not obtained a written Nondisclosure Agreement with
HCL-Hewlett Packard, Ltd. or HCL America ("HCL
267
America") relating to design work performed for Seller and/or ▇▇▇▇▇▇▇▇
regarding United States Patent Application Serial No. 08/409,317. Seller
and/or ▇▇▇▇▇▇▇▇ have not assigned, licensed, transferred or otherwise
conveyed any rights in the Technology to HCL America.
(f) Seller and/or ▇▇▇▇▇▇▇▇ pay no royalty under any Technology and
have the right to bring actions for the infringement thereof (except as
limited by the License Agreement).
(g) There are no legal or governmental proceedings pending, other than
patent, trademark, and copyright application prosecution proceedings,
relating to the Technology, and to Seller's and Hamirani's knowledge, no
such proceedings are threatened or contemplated by governmental authorities
or others.
(h) Seller and/or ▇▇▇▇▇▇▇▇ are not aware of any facts that would
preclude assignment to Palomar and Nexar of clear title to the Technology,
including without limitation the Assigned Applications/Registrations, free
from any encumbrances or liens.
(i) The Seller and/or ▇▇▇▇▇▇▇▇ have complied with the USPTO duty of
candor and disclosure for each of the patents and patent applications
included in the Technology.
(j) The Seller and/or ▇▇▇▇▇▇▇▇ are not aware of any facts which would
render any patent, copyright or trademark registrations included in, or
that may issue from the Technology, unenforceable or invalid.
(k) The Seller and/or ▇▇▇▇▇▇▇▇ are unaware of any facts which would
preclude the grant of a patent, trademark registration or copyright
registration from pending applications therefor included in the Technology.
2.6 Agreements and Other Arrangements. Exhibit 2.6 lists all of the
agreements and other arrangements, if any, to which Seller or ▇▇▇▇▇▇▇▇ are a
party or by or to which they or their assets are bound or subject and which are
material to Seller or ▇▇▇▇▇▇▇▇, their businesses, the Technology, including,
without limitation, the following: (a) design, engineering, manufacturing,
assembly, joint venture and partnership agreements; (b) license agreements; (c)
agreements with any outside consulting or contract engineers or designers or
other representative of Seller or ▇▇▇▇▇▇▇▇. There have been delivered or made
available to Nexar true and complete copies of all of the agreements and other
arrangements listed in Exhibit 2.6 and all other Exhibits hereto. All such
agreements and arrangements are in full force and effect and constitute legal,
valid and binding obligations upon Seller and/or ▇▇▇▇▇▇▇▇ and, to their
knowledge, the respective other parties thereto, enforceable in accordance with
their respective terms (except that such enforceability may be limited by
bankruptcy, insolvency, moratorium or other similar laws affecting or relating
to enforcement of creditors' rights generally and is subject to general
principles of equity). Seller and/or ▇▇▇▇▇▇▇▇ have paid in full or accrued all
material amounts due by it thereunder and has satisfied in all material
respects, or provided for, all of its material liabilities and obligations
thereunder. Except as disclosed in Exhibit 2.6, Seller and/or ▇▇▇▇▇▇▇▇ are not
in default under any material provision of any such agreement or arrangement,
nor, to its knowledge, is any other party to such agreement or arrangement in
default of any material
268
provision thereunder, nor does any condition exist that, with notice or lapse of
time or both, would constitute a default thereunder, which default would have a
materially adverse effect on Seller and/or ▇▇▇▇▇▇▇▇ or their respective
businesses.
2.7 No Employees. Other than ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇, Seller has no employees and
no employee has ever been compensated for any services rendered for or on behalf
of Seller or is due any such compensation for services rendered. Any individual
or entity engaged by Seller or ▇▇▇▇▇▇▇▇ to perform any design, engineering,
manufacturing or assembly services with respect to the Technology has been
retained strictly on the basis of work-for-hire and no liens or ownership
interest of any kind whatsoever has arisen in connection with any such services.
2.8 Purchase of Securities for Investment. The Seller and/or ▇▇▇▇▇▇▇▇ are
acquiring the Palomar Shares (as defined in Section 5.1(b)) for its own account
for investment purposes only and not with a view to distribution. Each of Seller
and ▇▇▇▇▇▇▇▇ has such knowledge and experience in financial and business
matters, either alone or with advisors, that each is capable of evaluating the
merits and risks of acquiring the Palomar Shares.
2.9 Affiliates. The affiliates of ▇▇▇▇▇▇▇▇ are listed on Exhibit 1.0
hereto. ▇▇▇▇▇▇▇▇ is the sole shareholder of Seller. Other than Seller and
Computer Universe, ▇▇▇▇▇▇▇▇ does not have any other affiliated businesses.
2.10 No Excluded Technology. There is no technology, proprietary
information or intellectual property owned by Seller or ▇▇▇▇▇▇▇▇, or in which
Seller or ▇▇▇▇▇▇▇▇ have a legal or equitable right of ownership, which will not
be included in the Purchased Assets transferred to Palomar and Nexar by the
Bills of Sale and other instruments of transfer referred to in Section 6.1 of
the Agreement, and which are related to the Technology.
ARTICLE III
REPRESENTATIONS AND WARRANTIES OF PALOMAR AND NEXAR
Palomar and Nexar each represent and warrant to Seller that the following
are true and complete as of the date hereof:
3.1 Organization, Standing and Power. Each of Nexar and Palomar is a
corporation duly organized, validly existing and in good standing under the laws
of Delaware, duly qualified as a foreign corporation to do business in
Massachusetts and California and has full corporate power and authority to own,
lease and operate its respective properties and to carry on its respective
business as proposed to be conducted.
3.2 Authority and Binding Obligation. This Agreement has been duly
authorized, executed and delivered by each of Nexar and Palomar, and each of
Nexar and Palomar has the corporate power and authority to enter into and
perform the obligations to be performed respectively by each hereunder. This
Agreement constitutes the valid and binding obligations of
269
each of Nexar and Palomar, enforceable against each in accordance with its
respective terms, except that such enforceability may be limited by bankruptcy,
insolvency, moratorium or other similar laws affecting or relating to
enforcement of creditor's rights generally and is subject to general principles
of equity.
3.3 Consents and Approvals. No consents or approvals of nor notification to
any governmental authority or other person not a party hereto is required in
connection with the execution and delivery of this Agreement by Nexar and
Palomar or the performance by Nexar and Palomar of their respective obligations
hereunder.
3.4 No Breach. Neither the execution and delivery of this Agreement nor the
consummation of the transactions contemplated hereby will (a) violate any
provision of the charter or by-laws of Nexar or Palomar nor any material law,
regulation, ordinance, judgment or decree applicable to Nexar or Palomar or
their respective properties or assets; or (b) violate or conflict with any
agreement to which Nexar or Palomar is a party.
ARTICLE IV
SETTLEMENT OF CLAIMS
4.1. Seller and ▇▇▇▇▇▇▇▇ shall deliver to Palomar and Nexar at the Closing
a duly executed General Release identical in form to Exhibit 4.1 hereof.
4.2. Palomar and Nexar shall deliver to Seller and ▇▇▇▇▇▇▇▇ at the Closing
a duly executed General Release identical in form to Exhibit 4.2 hereof.
4.3. Seller and ▇▇▇▇▇▇▇▇ shall cause Computer Universe to deliver to Nexar
at the Closing a duly executed General Release identical in form to Exhibit
4.3(a) hereof; Nexar shall deliver to Computer Universe at the Closing a duly
executed General Release identical in form to Exhibit 4.3(b) hereof.
ARTICLE V
CONSIDERATION
5.1 Consideration. The consideration for the Purchased Assets and releases
by Seller, ▇▇▇▇▇▇▇▇ and Computer Universe of all subject claims shall be as
follows:
(a) $75,000 in the aggregate, which shall be paid to Seller and/or
▇▇▇▇▇▇▇▇ on the date of execution of this Agreement by the parties hereto;
and
270
(b) The number of shares of the common stock of Palomar, $.01 par
value per share ("Palomar Common Stock"), which have an aggregate market
value (based on the per share closing bid of the Palomar Common Stock on
the business day immediately prior to The Nasdaq Stock Market on the
Closing Date of $1,500,000 (the "Palomar Shares"), to be delivered to
Seller and/or ▇▇▇▇▇▇▇▇ on the Closing Date; and
(c) $425,000 in the aggregate to be paid to Seller and/or ▇▇▇▇▇▇▇▇ on
the Closing Date; and
(d) $700,000 in deferred consideration to be delivered to the Escrow
Agent on the Closing Date pursuant to the terms of the Escrow Agreement;
and
(e) $50,000 to be paid to Computer Universe on the Closing Date
pursuant to the terms of the mutual releases between Nexar and Computer
Universe in the form of Exhibits 4.3(a) and (b) attached hereto.
ARTICLE VI
CLOSING
6.1. Obligations of Seller and ▇▇▇▇▇▇▇▇ at the Closing. At the Closing,
Seller and ▇▇▇▇▇▇▇▇ shall deliver or cause to be delivered to Palomar and/or
Nexar the following:
(a) (i) Bills of Sale identical in form to Exhibit 6.1(a)(i), and such
other instruments of transfer for the Purchased Assets (including by
non-limiting example assignments of patents, patent applications,
copyrights and trademarks) in form and substance reasonably satisfactory to
Palomar, Nexar and their counsel and sufficient to convey to Palomar all of
Seller's and Hamirani's right, title and interest in and to the Purchased
Assets; and (ii) such instruments of transfer shall include, by
non-limiting example, assignments of the Patent Application, the Additional
Patent Application and other technology in the form of an Assignment of
Technology identical in form to Exhibit 6.1(a)(ii) sufficient for
recordation with the United States Patent and Trademark Office and other
governmental offices;
(b) all Documentation and any tangible or intangible reduction to
practice or other representation of the Technology not already in Palomar's
or Nexar's possession; and
(c) a counterpart to the Escrow Agreement, duly executed by Seller,
▇▇▇▇▇▇▇▇ and the Escrow Agent;
271
(d) a counterpart of the Investment and Registration Rights Agreement
in the form of Exhibit 6.1(d) ("Investment Agreement"), duly executed by
Seller and ▇▇▇▇▇▇▇▇;
(e) a General Release identical in form to Exhibit 4.1, duly executed
by Seller and ▇▇▇▇▇▇▇▇;
(f) a General Release identical in form to Exhibit 4.3(a), duly
executed by Computer Universe;
(g) all copies of the Assigned Applications/Registrations (including
the Patent Application and the Additional Patent Application not yet
filed), along with copies of the Patent Application's entire history of
prosecution, or "file history", before the respective government offices
(such file history to include, but not be limited to, copies of the
application, filing receipts, office actions, responses, notices of
allowability and/or allowance, and any other correspondence between the
applicant and respective government office with respect to such Assigned
Applications/Registrations), which copies Palomar and Nexar shall have a
right to conduct a nonqualitative inspection at the Closing; and
(h) such other certificates, and documents and instruments as Nexar
may reasonably request to effectuate and evidence the transactions
contemplated hereby and the satisfaction of the obligations of Seller and
▇▇▇▇▇▇▇▇ under this Agreement.
6.2 Obligations of Nexar and Palomar at the Closing. At the Closing,
Palomar and Nexar shall deliver or cause to be delivered to Seller and ▇▇▇▇▇▇▇▇
the following:
(a) the $425,000 cash consideration specified in Section 5.1(c);
(b) the Palomar Shares;
(c) the $700,000 deferred consideration to be delivered to the Escrow
Agent pursuant to the Escrow Agreement;
(d) the $50,000 cash consideration to be delivered to Computer
Universe;
(e) a General Release identical in form to Exhibit 4.2, duly executed
by Nexar and Palomar;
(f) a General Release identical in form to Exhibit 4.3(b), duly
executed by Nexar;
(g) a counterpart to the Escrow Agreement, duly executed by Palomar;
(h) a counterpart to the Investment Agreement, duly executed by
Palomar; and
(i) a copy of the lock-up agreement between Nexar and its directors
and officers; and
272
(j) such other certificates, documents and instruments as Seller may
reasonably request to effectuate and evidence the transactions contemplated
hereby and the satisfaction of the obligations of Palomar and Nexar under
this Agreement. By the Closing Date, Seller and ▇▇▇▇▇▇▇▇ will provide
specific Closing instructions regarding which portions of the consideration
shall be made out to Seller as opposed to ▇▇▇▇▇▇▇▇.
ARTICLE VII
OTHER COVENANTS AND AGREEMENTS
7.1 Prior Agreement Terminated. The License Agreement to which Nexar and
Seller are parties, shall be automatically terminated and have no further force
and effect as of the close of business on the Closing Date and neither party
shall thereafter have any liability whatsoever to the other thereunder.
7.2 Non-Compete; Non-Disparagement; No Bad Acts. ▇▇▇▇▇▇▇▇ and Seller agree
that neither will during the period commencing upon execution of this Agreement
and ending on the Closing Date, either alone or jointly with, or as manager or
agent for, any person, corporation, partnership, joint venture or other business
organization, directly or indirectly engage or participate in, assist or consult
with in any manner or in any capacity, or have any interest in or make any loan
to any person, corporation, partnership, joint venture or other business
organization, or any company, which is engaged in manufacturing, development, or
sale of products incorporating any technology referred to in Section 1.1(i).
▇▇▇▇▇▇▇▇ and Seller further agree that neither will during the period
ending six months following the Closing Date, either alone or jointly with, or
as manager or agent for, any person, corporation, partnership, joint venture or
other business organization, directly or indirectly, solicit any person or
persons in the employment of Palomar or Nexar in any capacity whatsoever to
terminate such association and work for ▇▇▇▇▇▇▇▇, Seller, or any affiliates.
Commencing upon execution of this Agreement through the period ending 12
months following the Closing Date, the parties mutually agree that they will not
make any statement, orally or in writing, which disparages or damages the
reputation, quality of work, capabilities or integrity of any other party, as
the law provides, or do any wrongful act or omission which may damage the
reputation, quality of work, capabilities or integrity of any other party, as
the law provides.
273
Commencing upon execution of this Agreement through the period ending 12
months following the Closing Date, the parties mutually agree that they will not
interfere with or damage any beneficial or contractual relationship of the other
party, as the law provides.
7.3 Further Assurances of Seller and ▇▇▇▇▇▇▇▇. Commencing upon execution of
this Agreement (and thereafter, as applicable), Seller and ▇▇▇▇▇▇▇▇ shall (i)
maintain the pendency, validity and enforceability of Assigned
Applications/Registrations and shall not allow them to go abandoned or reduce
their scope; (ii) maintain the secrecy of all legally protectable trade secrets
and know-how included in Technology; and (iii) take no other actions tending to
reduce the scope of the Technology and/or Purchased Assets. After the Closing,
Seller and ▇▇▇▇▇▇▇▇ each hereby covenant that they will (i) execute, acknowledge
and deliver any further assignments, conveyances and other assurances, documents
and instruments of transfer reasonably requested by Palomar and/or Nexar from
time to time and shall take any other action consistent with the terms of this
Agreement that may be reasonably requested by Palomar and/or Nexar for the
purpose of selling, transferring, assigning, granting, conveying, delivering or
confirming to Palomar and/or Nexar as of the date of the Closing (or such other
date thereafter as the parties shall deem appropriate) any or all of the
Purchased Assets; (ii) provide any further facts and documents as may be known
and accessible to Seller and/or ▇▇▇▇▇▇▇▇ requested by Palomar and/or Nexar
relating to the Technology, and testify (at Palomar and/or Nexar's cost) as to
the same in any interference, opposition, litigation or proceeding related
thereto, and (iii) execute, acknowledge and deliver any further instruments or
affidavits reasonably requested by Palomar and/or Nexar from time to time to
apply for, obtain maintain, and enforce patents, copyrights, trade secrets and
other proprietary rights in the Technology assigned hereunder or to otherwise
carry out the purposes hereof. Neither the Seller nor ▇▇▇▇▇▇▇▇ shall retain any
copies of the Purchased Assets or materials disclosing or containing nonpublic
aspects of the same. If requested by Palomar and/or Nexar, Seller and/or
▇▇▇▇▇▇▇▇, at Palomar and/or Nexar's cost, shall prosecute or otherwise enforce
in Seller's and/or Hamirani's own names for the benefit of Palomar and/or Nexar
any claims, rights or benefits that are transferred to Palomar and/or Nexar by
this Agreement and that require prosecution or enforcement in Seller's and/or
Hamirani's names.
7.4 Further Assurances of Palomar and Nexar. All officers and directors of
Nexar shall agree to hold their shares of Nexar stock for a period not less than
six (6) months from the date of closing of Nexar's initial public offering. A
copy of the lock-up agreement confirming same shall be provided to Seller and
▇▇▇▇▇▇▇▇ at the Closing. Palomar and Nexar shall not fund any litigation or
other legal proceeding (except any defense or counterclaim) brought in the name
of any Palomar or Nexar director, officer, employee, or any others against
Seller or ▇▇▇▇▇▇▇▇ for the period ending four years following the Closing Date.
ARTICLE VIII
INDEMNIFICATION
274
8.1 Survival of Representations and Warranties. The representations and
warranties made by each of the parties in this Agreement shall be deemed to have
been relied upon by the other parties hereto and shall survive the Closing,
provided that in no event shall any party be entitled to seek indemnification in
respect of any breach of a representation or warranty made herein pursuant to
this Article VIII unless the party seeking indemnification has made a written
claim therefor pursuant to Section 9.9 prior to January 1, 2000.
8.2 Indemnification Provisions.
(i) In the event Seller and/or ▇▇▇▇▇▇▇▇ breaches (or in the event any
third party alleges facts that, if true, would mean Seller and/or ▇▇▇▇▇▇▇▇
has breached) any of their representations, warranties, and covenants
contained herein, provided that Palomar and/or Nexar makes a written claim
for indemnification against Seller and/or ▇▇▇▇▇▇▇▇ by notice to ▇▇▇▇▇▇▇▇
pursuant to Section 9.9 prior to January 1, 2000, then Seller and ▇▇▇▇▇▇▇▇
jointly and severally agree to indemnify Nexar and Palomar from and against
the entirety of any actions, suits, proceedings, hearing, investigations,
charges, complaints, claims, demands, injunctions, judgments, orders,
decrees, rulings, damages, dues, penalties, fines, costs, amounts paid in
settlement, liabilities, obligations, taxes, liens, losses, expenses, and
fees, including court costs and reasonable attorney's fees and expenses
("Adverse Consequences") Nexar or Palomar may suffer through and after the
date of the claim for indemnification (including any Adverse Consequences
Nexar or Palomar may suffer after December 31, 1999) resulting from,
arising out of, relating to, in the nature of, or caused by the breach (or
the alleged breach).
(ii) In the event Palomar or Nexar breaches (or in the event any third
party alleges facts that, if true, would mean Palomar or Nexar has
breached) any of its representations, warranties, and covenants contained
herein, provided that ▇▇▇▇▇▇▇▇ makes a written claim for indemnification
against Palomar or Nexar pursuant to Section 9.9 prior to January 1, 2000,
then Palomar and Nexar agree to indemnify each of the Seller and ▇▇▇▇▇▇▇▇
from and against the entirety of any Adverse Consequences the Seller or
▇▇▇▇▇▇▇▇ may suffer through and after the date of the claim for
indemnification (including any Adverse Consequences the Seller or ▇▇▇▇▇▇▇▇
may suffer after December 31, 1999) resulting from, arising out of,
relating to, in the nature of, or caused by the breach (or the alleged
breach).
8.3 Matters Involving Third Parties.
(i) If any third party shall notify any party (the "Indemnified
Party") with respect to any matter (a "Third Party Claim") which may give
rise to a claim for indemnification against any other party (the
"Indemnifying Party") under this Article VIII, then the Indemnified Party
shall promptly notify each Indemnifying Party thereof in writing; provided,
however, that no delay on the part of the Indemnified Party in notifying
any Indemnifying Party shall relieve the Indemnifying Party from any
obligation hereunder unless (and then solely to the extent) the
Indemnifying Party thereby is prejudiced.
275
(ii) Any Indemnifying Party will have the right to defend the
Indemnified Party against the Third Party Claim with counsel of its choice
reasonably satisfactory to the Indemnified Party so long as (A) the
Indemnifying Party notifies the Indemnified Party in writing within 15 days
after the Indemnified Party has given notice of the Third Party Claim that
the Indemnifying Party will indemnify the Indemnified Party from and
against the entirety of any Adverse Consequences the Indemnified Party may
suffer resulting from, arising out of, relating to, in the nature of, or
caused by the Third Party Claim, (B) the Indemnifying Party provides the
Indemnified Party with evidence reasonably acceptable to the Indemnified
Party that the Indemnifying Party will have the financial resources to
defend against the Third Party Claim and fulfill its indemnification
obligations hereunder, (C) the Third Party Claim involves only money
damages and does not seek an injunction or other equitable relief, (D)
settlement of, or an adverse judgment with respect to, the Third Party
Claim is not, in the good faith judgment of the Indemnified Party, likely
to establish a precedential custom or practice materially adverse to the
continuing business interests of the Indemnified Party, and (E) the
Indemnifying Party conducts the defense of the Third Party Claim actively
and diligently.
(iii) So long as the Indemnifying Party is conducting the defense of
the Third Party Claim in accordance with Section 8.3(ii) above, (A) the
Indemnified Party may retain separate co-counsel at its sole cost and
expense and participate in the defense of the Third Party Claim, (B) the
Indemnified Party will not consent to the entry of any judgment or enter
into any settlement with respect to the Third Party Claim without the prior
written consent of the Indemnifying Party (not to be withheld
unreasonably), and (C) the Indemnifying Party will not consent to the entry
of any judgment or enter into any settlement with respect to the Third
Party Claim without the prior written consent of the Indemnified Party (not
to be withheld unreasonably).
(iv) In the event any of the conditions in Article 8.3(ii) above is or
becomes unsatisfied, however, (A) the Indemnified Party may defend against,
and consent to the entry of any judgment or enter into any settlement with
respect to, the Third Party Claim in any manner it reasonably may deem
appropriate (and the Indemnified Party need not consult with, or obtain any
consent from, any Indemnifying Party in connection therewith), (B) the
Indemnifying Parties will reimburse the Indemnified Party promptly and
periodically for the costs of defending against the Third Party Claim
(including reasonable attorneys' fees and expenses), and (C) the
Indemnifying Parties will remain responsible for any Adverse Consequences
the Indemnified Party may suffer resulting from, arising out of, relating
to, in the nature of, or caused by the Third Party Claim to the fullest
extent provided in this Article VIII.
8.4 Other Indemnification Provisions. The foregoing indemnification
provisions are in addition to, and not in derogation of, any statutory,
equitable, or common law remedy any party may have for breach of representation,
warranty, or covenant.
276
ARTICLE IX
GENERAL PROVISIONS
9.1 Publicity. Neither ▇▇▇▇▇▇▇▇ nor Seller or any of their affiliates shall
issue any press release or other public statement with respect to the
transactions contemplated by this Agreement without the prior written consent of
Palomar and Nexar, which consent will not be unreasonably withheld.
9.2 Headings. The subject headings of the Sections and subsections of this
Agreement are included for purposes of convenience only and shall not affect the
interpretation of any of its provisions.
9.3 Entire Agreement; Amendments and Waivers. This Agreement constitutes
the entire agreement among the parties pertaining to the subject matter
contained herein and supersedes all prior agreements, representations and
understandings of the parties. No supplement, modification or amendment of this
Agreement shall be binding unless executed in writing by the party to be bound.
No waiver of any of the provisions of this Agreement shall be deemed a waiver of
any other provision, whether or not similar, nor shall any waiver constitute a
continuing waiver. No waiver shall be binding unless executed in writing by the
party making the waiver.
9.4 Counterparts. This Agreement may be executed in one or more
counterparts, each of which shall be deemed an original, but all of which
together shall constitute one and the same instrument.
9.5 Severability; Reformation. In case any one or more of the provisions
(or parts of a provision) contained in this Agreement shall, for any reason, be
held to be invalid, illegal or unenforceable in any respect, such invalidity,
illegality or unenforceability shall not affect any other provision (or part of
a provision) of this Agreement; and this Agreement shall, to the fullest extent
lawful, be reformed and construed as if such invalid, illegal or unenforceable
provision (or part of a provision) had never been contained herein, and such
provision (or part) reformed so that it will be valid, legal and enforceable to
the maximum extent possible, consistent with the parties' intent.
9.6 Other Parties. Nothing in this Agreement, whether express or implied,
is intended to confer any rights or remedies under this Agreement on any persons
other than the parties to it and their respective successors and permitted
assigns, nor is anything in this Agreement intended to relieve or discharge the
obligation or liability of any third persons to any party to this Agreement, nor
shall any provision give any third persons any right of subrogation or action
against any party to this Agreement.
9.7 Assignment. This Agreement shall be binding upon and inure to the
benefit of the parties hereto and their respective successors and permitted
assigns. Neither this Agreement nor
277
any of the rights, interests and obligations hereunder shall be assigned by any
of the parties hereto without the prior written consent of the other, which
consent shall not be unreasonably withheld, except that Palomar may assign this
Agreement to any of its subsidiaries (provided that Palomar remains obligated
hereunder) or to any purchaser of all or substantially all of the capital stock
or assets of Palomar, whether by merger or otherwise.
9.8 Governing Law. Except for the General Releases in the form of Exhibits
4.1, 4.2, 4.3(a) and 4.3(b) which shall be construed in accordance with, and
governed by, the laws of the State of California, this Agreement and the
exhibits hereto shall be construed in accordance with, and governed by, the laws
of The Commonwealth of Massachusetts, including, without limitation, its
statutes of limitations, but without giving effect to its rules governing choice
of law.
9.9 Notices. All notices, requests, demands and other communications under
this Agreement shall be in writing and delivered by personal delivery, mail,
overnight courier or telecopy. Such communications shall be deemed given, if by
personal delivery, when received; if by mail, when mailed by certified or
registered mail (postage prepaid and return receipt requested); or if by
overnight courier or telecopy, when delivered to such courier or sent by
telecopy (provided that the party giving such communication has confirmation of
such courier delivery or telecopy delivery), and, in each case, addressed to the
party to whom notice is to be given as set forth below:
Palomar:
Palomar Medical Technologies, Inc.
▇▇ ▇▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
Attention: ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇, Chairman
Nexar:
Nexar Technologies, Inc.
▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇
Chairman and Chief Executive Officer
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
with a copy to:
▇▇▇▇▇▇▇ ▇. ▇▇▇▇, Esq.
▇▇▇▇▇▇, Hall & ▇▇▇▇▇▇▇
Exchange Place
278
▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
Seller and ▇▇▇▇▇▇▇▇:
c/o ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Telephone:
Facsimile:
with a copy to:
▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇, Esq.
Ropers, Majeski, ▇▇▇▇ & ▇▇▇▇▇▇▇
▇▇ ▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
Any party may change its address or the individual(s) to whom notice is to be
given for purposes of this Section 9.9 by giving the other parties notice of the
new address or individual in the manner set forth above; provided that any such
notice of change of address or individual shall not be in effect until received.
9.10 Arbitration. For the period ending 12 months following the Closing
Date, or so long as there is deferred compensation held by the Escrow Agent
pursuant to the Escrow Agreement, the sole forum for the litigation of any
dispute arising under or in connection with this Agreement or any exhibit hereto
shall be by binding arbitration conducted by J.A.M.S/ENDISPUTE in San Francisco,
California by a person chosen by mutual agreement of the parties, and if the
parties fail to agree, chosen by J.A.M.S/ENDISPUTE. The parties agree that if
the amount in controversy exceeds $100,000, then the discovery procedures as
established by the Federal Rules of Civil Procedure shall be incorporated into
the J.A.M.S/ENDISPUTE applicable rules. The prevailing party in any such
proceeding shall be entitled to recover attorney's fees and costs incurred in
that proceeding.
279
IN WITNESS WHEREOF, each of the parties hereto has caused this Agreement to
be duly executed under seal as of the date and year first above written.
PALOMAR MEDICAL TECHNOLOGIES, INC.,
/s/
------------------------------ By: /s/
Witness -----------------------------
▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
Treasurer and Chief Financial
Officer
NEXAR TECHNOLOGIES, INC.
/s/
----------------------------- By: /s/
Witness ----------------------------
▇▇▇▇▇▇ ▇. ▇▇▇▇▇
Chairman and
Chief Executive Officer
TECHNOVATION COMPUTER LABS, INC.
/s/
---------------------------- By: /s/
Witness -----------------------------
▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
President
/s/ /s/
--------------------------- --------------------------------
Witness ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
280
Exhibit 1.0
Affiliates
▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇
Technovation Computer Labs, Inc.
Amerisel, Inc. (d/b/a Computer Universe)
