EXHIBIT 10.1
DATED 20th NOVEMBER 2002
THE PARTIES WHOSE NAMES ARE SET OUT IN SCHEDULE 1
INFINITI SOLUTIONS PTE LTD
AUTOMATED TECHNOLOGY (PHIL.) INC.
GLOBAL CROWN LIMITED
FINETECH INTERNATIONAL LIMITED
GOLD XXXX LIMITED
and
MAYON CAPITAL LIMITED
--------------------------------------------
SHARE PURCHASE AGREEMENT
IN RESPECT OF
GLOBAL CROWN LIMITED
FINETECH INTERNATIONAL LIMITED
GOLD XXXX LIMITED
MAYON CAPITAL LIMITED
-------------------------------------------
XXXXX & X.XXXXXX.XXXX & XXXX XXXXXX XXXXXXX XXXXXXXXXXXX
INTERNATIONAL LAWYERS SAYOC & DE LOS ANGELES
ASSOCIATED WITH 30/F Citibank Tower
XXXXX & X.XXXXXX 0000 Xxxxx xx Xxxxx
Xxxx xx Xxxxxx
0 Xxxxxxx Xxxxxx #00-00 XXXXXXXXXXX
Millenia Tower Telephone: (000) 000 0000
XXXXXXXXX 000000 Facsimile: (000) 000 0000
Telephone: (00) 0000 0000
Facsimile: (00) 0000 0000
ACTING FOR THE VENDORS
ACTING FOR THE PURCHASER
CONTENTS
CLAUSES PAGES
------- -----
1. Definitions and Interpretation 3
2. Sale of Sale Shares 9
3. Consideration 9
4. Conditions 10
5. Completion 13
6. Obligations of the Vendors 16
7. Covenant in Respect of Environmental Matters 18
8. Pre-Completion Obligations 19
9. Confidentiality 24
10. Costs 24
11. General 25
12. Notices 26
13. Governing Law and Dispute Resolution 27
SCHEDULE 1 Details of the Vendors........................................ 27
SCHEDULE 2 Brief Details of the Company and the BVI Companies............ 30
SCHEDULE 3 Shareholding of the Purchaser (referred to in Clause 3.2)..... 33
SCHEDULE 4 The Investee Companies........................................ 34
Blue Sky Integrated Designs, Inc.............................. 35
SCHEDULE 5 The Properties................................................ 36
SCHEDULE 6 Continuing Employees.......................................... 37
SCHEDULE 7 WARRANTIES OF THE VENDORS..................................... 38
SCHEDULE 8 WARRANTIES OF THE PURCHASER................................... 56
SCHEDULE 9 Personal Guarantees........................................... 80
SCHEDULE 10 Form of Promissory Note....................................... 81
EXECUTION PAGE 85
i
DATE: 20 NOVEMBER 2002
PARTIES:
(1) THE PARTIES WHOSE NAMES ARE SET OUT IN COLUMNS 1 OF SCHEDULE 1 IN RELATION
TO EACH BVI COMPANY (defined below) represented herein by their duly
appointed attorney-in-fact, Xxxxxx Xxxxxxx Xxxxxxx, Filipino, of legal age
and with address at 0000 Xxxxxxxxx Xxxxxx, Xxxxxxxxxx Xxxxxxx, Xxxxxx
Xxxx, Xxxxxxxxxxx;
(collectively the "VENDORS" and each, a "VENDOR");
(2) INFINITI SOLUTIONS PTE LTD, a company incorporated in Singapore whose
registered office is at 0000 Xxxxx Xxxx #00-00 Xxxxxx Xxxx Xxxxxxx
Xxxxxxxxx 000000 (the "PURCHASER");
(3) AUTOMATED TECHNOLOGY (PHIL.) INC., a company incorporated in the
Philippines whose registered office is at Light Industry and Science Park
of the Philippines, Cabuyao, Laguna, Philippines (the "COMPANY");
(4) GLOBAL CROWN LIMITED, a company incorporated in the British Virgin Islands
with International Business Company Number 177098, whose registered office
is at Beaufort House, Tropic Isle Building, PO Box 438, Road Town,
Tortola, British Virgin Islands ("GLOBAL");
(5) FINETECH INTERNATIONAL LIMITED, a company incorporated in the British
Virgin Islands with International Business Company Number 317784, whose
registered office is at Beaufort House, Tropic Isle Building, PO Box 438,
Road Town, Tortola, British Virgin Islands ("FINETECH");
(6) GOLD XXXX LIMITED, a company incorporated in the British Virgin Islands
with International Business Company Number 334702, whose registered office
is at Beaufort House, Tropic Isle Building, PO Box 438, Road Town,
Tortola, British Virgin Islands ("GOLD XXXX");
(7) MAYON CAPITAL LIMITED, a company incorporated in the British Virgin
Islands with International Business Company Number 297541, whose
registered office is at Beaufort House, Tropic Isle Building, PO Box 438,
Road Town, Tortola, British Virgin Islands ("MAYON"),
("GLOBAL", "FINETECH", "GOLD XXXX" and "XXXXX" shall hereinafter be
referred to as the "BVI COMPANIES", and "BVI COMPANY" refers to each or
any one of them).
(collectively, the "PARTIES" and each, a "PARTY").
2
RECITALS:
(A) The Vendors are the registered and beneficial owners of all of the
outstanding and issued capital in the capital of the BVI Companies.
Limited particulars of the BVI Companies are set out in Schedule 2.
(B) The BVI Companies are the registered and beneficial owners of all the
issued capital stock in the Company. Limited particulars of the Company
are set out in Schedule 2.
(C) The Vendors wish to sell and the Purchaser wishes to purchase all of the
said outstanding and issued capital of the BVI Companies on the terms and
conditions set out in this Agreement.
TERMS AGREED:
1. DEFINITIONS AND INTERPRETATION
1.1 In this Agreement where the context so admits the following words and
expressions shall have the following meanings:
"ACCOUNTING DATE" 31 December 2001;
"ACCOUNTS" the audited consolidated financial
statements of the Company and of each of
the Investee Companies for the
accounting reference period which ended
on the Accounting Date (each such
financial statement comprising a balance
sheet, profit and loss account, cash
flow statement, notes and directors' and
auditors' report) and the consolidated
profit and loss account and consolidated
balance sheet of the Company and the
Investee Companies as at and for the
period ending on the Accounting Date;
"AML TRADING LIMITED" a Vendor, which is a company
incorporated in the British Virgin
Islands with International Business
Company Number 386647 whose registered
office is at Beaufort House, Tropic Isle
Building, PO Box 438, Road Town,
Tortola, British Virgin Islands;
"BASKET" shall have the meaning ascribed to it in
Clause (1)(iii) of Schedule 7;
"BVI COMPANIES DIRECTORS" the persons listed as directors of the
BVI Companies in Schedule 2;
"COMPANY DIRECTORS" the persons listed as directors of the
Company in
3
Schedule 2;
"COMPANIES ACT" the Companies Act of Singapore (Cap.
50);
"COMPLETION" completion of the sale and purchase of
the Sale Shares as specified in Clause
5;
"COMPLETION DATE" 16 December 2002 (or such later date as
the Vendors and the Purchaser may
agree);
"CONDITIONS" the conditions specified in Clause 4.1;
"CONFIDENTIAL INFORMATION" know-how, trade secrets and other
information of a confidential nature,
wherever in the world protectable;
"CONSIDERATION SHARES" shall have the meaning ascribed to it in
Clause 3.1(a);
"CONTINUING EMPLOYEES" the employees of the Company whose names
are listed in Schedule 6;
"DISCLOSURE LETTER" the letter to be dated the Completion
Date from the Vendors to the Purchaser
in the approved terms;
"ENCUMBRANCE" any form of legal, equitable or security
interests, including but not limited to
any mortgage, assignment of receivables,
debenture, lien, charge, pledge, title
retention, right to acquire, security
interest, hypothecation, options, rights
of first refusal, any preference
arrangement (including title transfers
and retention arrangements or otherwise)
and any other encumbrance or condition
whatsoever or any other arrangements
having similar effect;
"ENVIRONMENT" all or any of the following media,
namely, the air, water and land; and the
medium of air includes the air within
buildings and the air within other
natural or man-made structures above or
below ground;
"ENVIRONMENTAL BREACH" shall have the meaning ascribed to it in
Clause 7.1(b);
"ENVIRONMENTAL LAW" all and any applicable laws, common law,
statutes, directives, regulations,
notices, standards having force of law,
codes of practice, guidance notes,
by-laws, judgments, decrees or orders
relating to (a) pollution, contamination
or protection of the
4
Environment or (b) the storage,
labelling, handling, release, treatment,
manufacture, processing, deposit,
transportation or disposal of Hazardous
Substances or (c) the responsibility or
duty of care for waste;
"ENVIRONMENTAL LICENCE" any permit, licence, authorization,
consent or other approval, that may be
required by any Environmental Law;
"EQUITY INCENTIVE PLAN" the 2002 Equity Incentive Plan of the
Purchaser established in accordance with
the Investment Agreement and adopted by
the shareholders of the Purchaser on 15
April 2002;
"GROUP" the group of companies comprising the
BVI Companies, the Company and its
Investee Companies. The expression
"MEMBER OF THE GROUP" shall be construed
accordingly;
"GOVERNMENTAL APPROVAL" any authorization, consent, approval,
registration, filing, certificate,
license, permit or exemption from, by or
with any Government Authority, or
otherwise pursuant to any applicable law
or regulation, whether given or withheld
by express action or deemed given or
withheld by failure to act within any
specified time period;
"GOVERNMENT AUTHORITY" any governmental, state or other
political subdivision thereof, or any
entity exercising or entitled to
exercise executive, legislative,
judicial, regulatory or administrative
functions of or pertaining to
government;
"HAZARDOUS SUBSTANCES" all substances of whatever description
which may cause or have a harmful effect
on the Environment or the health of man
or any other living organism including,
without limitation, all poisonous,
toxic, noxious, dangerous and offensive
substances;
"INDEMNIFIED PURCHASERS" shall have the meaning ascribed to it in
Clause (d) of Schedule 7;
"INDEMNIFIED VENDORS" shall have the meaning ascribed to it in
Clause (e) of Schedule 8;
"INTELLECTUAL PROPERTY" includes Confidential Information,
patents, registered designs, copyrights,
rights in databases, design rights,
protected layout-design rights,
topography rights, trade marks, business
names,
5
registrations of and applications
to register any of the aforesaid items,
rights in the nature of any of the
aforesaid items in any country, rights
in the nature of unfair competition
rights and rights to xxx for passing
off, in each case wherever in the world
enforceable;
"INVESTEE COMPANIES" the subsidiaries of the Company and any
other companies in which the Company has
an interest, short particulars of which
are set out in Schedule 4;
"INVESTMENT AGREEMENT" the investment agreement dated 30
November 2001 in respect of the
Purchaser entered into between the
Purchaser, 3i Group plc, 3i Asia Pacific
Technology LP, EDB Investments Pte Ltd,
Xxxxxxxx Xxxxx, Kong Kah Chin, Xxxxxxx
Xxxx Xxxx Xxxx and Xxxxx Xxxxxx
Xxxxxxxxxxxxx (together with any
amendments thereto);
"MANAGEMENT ACCOUNTS" the unaudited consolidated balance sheet
of the Company and the Investee
Companies as at 31 October 2002 and the
unaudited consolidated profit and loss
account of the Company and of each of
the Investee Companies for the period
ending on such date;
"OPTION SHARES" shall have the meaning ascribed to it
in Clause 3.1(d);
"PERSONAL GUARANTEES" the guarantees or other security in
place as at the date of this Agreement
and which are listed in Schedule 9;
"PHP" means Philippines pesos, the lawful
currency of the Philippines;
"PROCEEDING" any action, arbitration, audit,
examination, investigation, hearing,
litigation or suit (whether civil,
criminal, administrative, judicial or
investigative, whether formal or
informal, and whether public or private)
commenced, brought or conducted or heard
by or before, or otherwise involving,
any Government Authority or arbitrator;
"PROMISSORY NOTE" shall mean the form of promissory note
to be executed by the Purchaser and made
in favour of AML Trading Limited which
shall be substantially in the form set
forth in Schedule 10;
6
"PROPERTIES" the properties owned or leased by the
Company or any of the Investee
Companies, short particulars of which
are set out in Schedule 5;
"PURCHASER'S BASKET" shall have the meaning ascribed to it in
Clause (d) of Schedule 8;
"PURCHASER'S DISCLOSURE LETTER" the letter to be dated the Completion
Date from the Purchaser to the Vendors
in the approved terms;
"PURCHASER'S LAWYERS" Xxxxx & XxXxxxxx. Xxxx & Xxxx, of 0
Xxxxxxx Xxxxxx #00-00, Xxxxxxxx Xxxxx,
Xxxxxxxxx 000000;
"PURCHASER'S WARRANTIES" shall have the meaning ascribed to it in
Clause (a) of Schedule 8;
"RELEVANT VIKO INSTALLMENT" shall have the meaning ascribed to it in
Clause 5.3(e);
"REMEDIAL ACTION" investigating, removing, remedying,
cleaning up, abating, containing,
controlling or ameliorating the presence
in, or effect on, the Environment of,
any pollution or contamination
(including, where necessary, obtaining
expert technical and legal advice in
relation thereto);
"SALE SHARES" all the issued and paid up shares of par
value US$1.00 each in the capital of the
BVI Companies owned by the Vendors (in
the proportion set out in Schedule 1 in
relation to each BVI Company);
"SHAREHOLDERS AGREEMENT" shall have the meaning ascribed to it in
Clause 4.1(i);
"TAX" all forms of taxation, withholdings,
duties, imposts, levies, social security
contributions and rates imposed by any
local, municipal, governmental, state,
federal, or other body in the
Philippines or elsewhere and any
interest, penalty, surcharge or fine in
connection therewith;
"TAX WARRANTIES" shall have the meaning ascribed to it in
Clause (1)(i)(1) in Schedule 7;
"THIRD PARTY CONFIDENTIAL any Confidential Information insofar as
INFORMATION" it relates to and is proprietary and
confidential to a third party;
7
"US$" the lawful currency of the United States
of America;
"VENDORS' LAWYERS" Xxxxxx Xxxxxxx Xxxxxxxxxxxx Xxxxx & De
Los Angeles of 30/F, Citibank Tower,
0000 Xxxxx xx Xxxxx, Xxxx xx Xxxxxx,
Xxxxxxxxxxx;
"VIKO TECHNOLOGY, INC." a California corporation, whose entire
issued and outstanding capital is owned
by the Purchaser;
"VIKO SHARE PURCHASE the Share Purchase Agreement executed
AGREEMENT" between the Purchaser and shareholders
of Viko Technology, Inc. dated December
18, 2001; and
"WARRANTIES" the representations, warranties and
undertakings contained or referred to in
Schedule 7.
1.2 Save where the context otherwise requires, words and phrases the
definitions of which are contained or referred to in the Companies Act
shall be construed as having the meaning thereby attributed to them.
1.3 Any references, express or implied, to statutes or statutory provisions
shall be construed as references to those statutes or provisions as
respectively amended or re-enacted or as their application is modified
from time to time by other provisions (whether before or after the date
hereof) and shall include any statutes or provisions of which they are
re-enactments (whether with or without modification) and any orders,
regulations, instruments or other subordinate legislation under the
relevant statute or statutory provision. References to sections of
consolidating legislation shall wherever necessary or appropriate in the
context be construed as including references to the sections of the
previous legislation from which the consolidating legislation has been
prepared.
1.4 References in this Agreement to clauses and schedules are to clauses in
and schedules to this Agreement (unless the context otherwise requires).
The recitals and schedules to this Agreement shall be deemed to form part
of this Agreement.
1.5 Headings are inserted for convenience only and shall not affect the
construction of this Agreement.
1.6 The expression "THE VENDORS" includes their respective personal
representatives, successors and assigns and the expression "THE
PURCHASER", the "BVI COMPANIES" and the "COMPANY" includes each of their
successors and assigns.
1.7 References to "PERSONS" shall include bodies corporate, unincorporated
associations and partnerships (whether or not having separate legal
personality).
1.8 References to writing shall include any methods of reproducing words in a
legible and non-transitory form.
8
1.9 The masculine gender shall include the feminine and neuter and the
singular number shall include the plural and vice versa.
1.10 All warranties, representations, indemnities, covenants, agreements and
obligations given or entered into by more than one person are given or
entered into jointly and severally.
1.11 A document expressed to be "IN THE APPROVED TERMS" means a document the
terms of which have been approved by or on behalf of the Vendors and the
Purchaser.
2. SALE OF SALE SHARES
2.1 Subject to the terms of this Agreement, each of the Vendors as legal and
beneficial owners shall sell and the Purchaser shall purchase, free from
all liens, charges and encumbrances and together with all rights now or
hereafter attaching to them, including all rights to any dividend or other
distribution declared, made or paid after the date of this Agreement, the
number of Sale Shares set opposite each Vendor's name in column 2 of
Schedule 1 in relation to all the BVI Companies and shall transfer his
legal and beneficial ownership in respect of the Sale Shares to the
Purchaser accordingly.
2.2 Each of the Vendors hereby waives and agrees to procure the waiver of any
restrictions on transfer (including pre-emption rights) which may exist in
relation to the Sale Shares, whether under the articles of association,
by-laws or other equivalent constitutive documents of the BVI Companies or
otherwise.
3. CONSIDERATION
3.1 The consideration for sale and purchase of all the Sale Shares shall be
satisfied in the following manner:
(a) the Purchaser shall issue and allot 4,442,499 ordinary shares of par
value US$0.10 each in the capital of the Purchaser (the
"CONSIDERATION SHARES"), fully paid up, to the Vendors or their
nominees at Completion in a manner consistent with the numbers set
out in Schedule 3;
(b) the Purchaser shall procure or arrange for payment to AML Trading
Limited (whose receipt the Vendors acknowledge and agree shall be an
absolute discharge of the Purchaser's payment obligation hereunder)
of the amount of US$1,500,000 at Completion;
(c) the Purchaser shall procure or arrange for payment to AML Trading
Limited (whose receipt the Vendors acknowledge and agree shall be an
absolute discharge of the Purchaser's payment obligation hereunder)
of the amount of:
(i) US$1,500,000 by the expiry of 180 days from the Completion
Date;
(ii) US$1,500,000 by the expiry of 365 days from the Completion
Date;
9
(iii) US$1,500,000 by the expiry of 540 days from the Completion
Date; and
(iv) US$2,000,000 by the expiry of 730 days from the Completion
Date.
The Purchaser agrees that it shall pay interest on any unpaid
consideration amounts set out in this Clause 3.1(c) at the rate of
5% per annum for the period commencing on the Completion Date and
ending on the date of actual payment of such amount. The interest
payable pursuant to this Clause 3.1(c) shall be satisfied by payment
in cash.
The four installment payments due to AML Trading Limited pursuant to
this Clause 3.1(c) shall be evidenced by a Promissory Note.
(d) the Purchaser shall procure the grant of options over 454,369
ordinary shares of par value US$0.10 each in the capital of the
Purchaser to management of the Company (the "OPTION SHARES") within
three months from the Completion Date pursuant to and on terms set
out in the Equity Incentive Plan. The allocation of the Option
Shares shall be mutually agreed between the Vendors and the
Purchaser prior to Completion and the parties agree to use all
reasonable endeavours, after Completion, to conform the Equity
Incentive Plan to the extent necessary in order to be in compliance
with the laws of the Philippines, and to obtain all necessary
approvals or exemptions in the Philippines, in order that such
Option Shares can be granted in accordance with this Clause 3.1(d).
3.2 Following the allotment of the Consideration Shares and the Option Shares
pursuant to Clauses 3.1(a) and 3.1(d) above, the shareholding in the
Purchaser shall be held in the proportions set out in Schedule 3.
3.3 Notwithstanding anything else contained in this Agreement, the parties
agree that the Purchaser is subject to the provisions set out in Schedule
8.
4. CONDITIONS
4.1 The sale and purchase of the Sale Shares is conditional upon:
(a) the Vendors having complied fully with the obligations specified in
Clauses 8.1, 8.2 and 8.3 and otherwise having performed in all
material respects all of the covenants and agreements required to be
performed by them under this Agreement;
(b) the completion of all business, financial, regulatory and legal due
diligence in relation to the Group to the satisfaction of the
Purchaser;
(c) all other consents, approvals or clearances which are necessary or
which the Purchaser has been advised that it is desirable to obtain
to the sale and
10
purchase of the Sale Shares being granted by third parties
(including any Government Authority);
(d) no statute, regulation or decision which would prohibit, restrict or
materially delay the sale and purchase of the Sale Shares or the
operation of the Company or any of the Investee Companies after
Completion having been proposed, enacted or taken by any Government
Authority;
(e) the approval of the board of directors and shareholders of the
Purchaser in relation to the sale and purchase of the Sale Shares
having been obtained;
(f) each of the seven Continuing Employees having entered into a service
agreement with the Company prior to the Completion Date on terms
approved by the Purchaser and acceptable to such Continuing
Employees;
(g) the Vendors and the Purchasers having agreed on the list of persons
to whom the Option Shares are to be granted pursuant to Clause
3.1(d);
(h) a rental review report on the Properties having been prepared by,
and delivered to, the Purchaser and the Vendors by CB Xxxxxxx Xxxxx,
and the Company having entered into an amendment to its existing
lease agreement(s) with the landlord of the Properties on the rental
value and such related terms acceptable to the Purchaser, the
Vendors and the landlord in question, provided that such amendment
to the lease agreement(s) will record the parties' understanding
that the terms of the existing lease agreement(s) for the Properties
shall remain unchanged for as long as any amounts owing to AML
Trading Ltd pursuant to Clause 3.1(c) above shall remain unpaid and
that such amendment to the existing lease agreement(s) shall only
become effective upon full payment by the Purchaser to AML Trading
Ltd of the amounts owing pursuant to Clause 3.1(c) above and the
relevant annotations having been made to the Transfer Certificate of
Title(s) of the Properties (including without limitation, in respect
of the Company's leasehold rights);
(i) the execution by such persons as the Vendors shall advise pursuant
to Clause 3.1(a) and the other shareholders of the Purchaser of a
shareholders agreement relating to the Purchaser on terms
satisfactory to each of them (the "SHAREHOLDERS AGREEMENT");
(j) confirmation or approval having been obtained by the Company from RF
Monolithics, Inc. that the sale of the Sale Shares shall not cause
RF Monolithics, Inc. to terminate the Manufacturing Agreement dated
22 February 2001 entered into with the Company;
(k) the Company having entered into legally binding loan agreements on
terms acceptable to the Purchaser to re-finance its existing loan
facilities with its existing bankers including (i) Banco De Oro (ii)
Rizal Commercial Banking Corporation and (iii) Bank of the
Philippine Islands, as a result of which the Personal Guarantees
will be released;
11
(l) a certified true copy of the stock and transfer book of ATEC-KMI
Philippines, Inc (an Investee Company) certified by the company
secretary of ATEC-KMI Philippines, Inc. reflecting the transfer from
Korean Microsystems, Inc of shares in ATEC-KMI Philippines, Inc. to
Mayon Capital Limited having been provided to the Purchaser by the
Vendors;
(m) confirmation from the Philippine Economic Zone Authority as to the
continuing validity of the ecozone export enterprise status of the
Company (including the survival of any incentives enjoyed by the
Company pursuant to such status);
(n) the Company having successfully renewed all relevant licences,
permits and registrations which have expired and are required or
useful for the Company's operations;
(o) the Company and the BVI Companies having passed board and
shareholder resolutions respectively to confirm the abandonment of
(i) the proposed private placement exercise of the shares of the
Company approved on 10 October 2000 to raise up to US$9,000,000 and
(ii) plans for the restructuring and initial public offer of the
shares of the Company;
(p) the Disclosure Letter having been delivered to the Purchaser by the
Vendors, and the Purchaser's Disclosure Letter having been delivered
to the Vendors by the Purchaser, on the Completion Date. For the
avoidance of doubt, the Purchaser shall have the discretion to
reject the Disclosure Letter if the contents of such Disclosure
Letter are not satisfactory to it, and vice versa and the exercise
of such a right of rejection by either the Purchaser or the Vendors
(as the case may be) in good faith shall not constitute a breach of
this Agreement; and
(q) confirmation having been obtained by the Purchaser from Comerica and
Bank of California that Viko Technology, Inc. is not in breach of
any provisions of relevant loan agreements entered into by Viko
Technology, Inc.
4.2 The Purchaser or the Vendors may waive all or any of such conditions
required to be fulfilled by the Vendors or the Purchaser (as the case may
be) set out in Clause 4.1 above at any time by notice in writing to the
Vendors' Lawyers or the Purchaser's Lawyers (as the case may be).
4.3 The Vendors and the Purchaser (as the case may be) shall use their best
endeavours to procure the fulfilment of the Conditions required to be
fulfilled by them or any member of the Group (in the case of the Vendors)
on or before the Completion Date.
4.4 In the event that any of Conditions shall not have been fulfilled (or
waived pursuant to Clause 4.2) by the Completion Date, then the Purchaser
shall not be bound to proceed with the purchase of the Sale Shares and
unless extended by the Purchaser in writing, this Agreement shall cease to
be of any effect except Clauses 1, 9, 11.1, 11.2, 11.4 (insofar as
relevant to the interpretation of this Agreement in any claim or
proceeding
12
after cessation) and 11.5, 12 and 13, which shall remain in force, and
save in respect of claims arising out of any antecedent breach of this
Agreement.
4.5 On the date of this Agreement each Vendor (apart from Xxxxxx Xxxxxxx
Xxxxxxx who shall execute this Agreement in his own capacity and AML
Trading Limited) shall deliver to the Purchaser an original version of a
duly executed and valid power-of-attorney coupled with an interest
irrevocably appointing Xxxxxx Xxxxxxx Tanseco as his attorney-in-fact to
negotiate and enter into this Agreement on the terms herein and provide
all necessary approvals, consents, waivers, endorsements or other
documents referred to in this Agreement, in each case, on his behalf.
5. COMPLETION
5.1 Subject to the provisions of Clause 4, Completion shall take place on the
Completion Date at the offices of the Purchaser's Lawyers (or some other
place as the parties may agree) when all (but not some only) of the events
described in this Clause 5 shall occur.
5.2 At Completion, provided that all the conditions precedent to Completion
provided in Clause 4.1 shall have been fulfilled or otherwise waived by
the relevant party, the Vendors shall:
(a) deliver (or procure the delivery of) to the Purchaser:
(i) duly executed transfers of its respective Sale Shares in
favour of the Purchaser together with the relevant share
certificates in respect of such Sale Shares;
(ii) such waivers or consents as the Purchaser may require to
enable the Purchaser or its nominees to be registered as
holders of any of the Sale Shares;
(iii) all the corporate records, statutory and other books (duly
written up to date), consisting of the Articles of
Incorporation and the By-Laws and all amendments thereto
together with the corresponding Securities and Exchange
Commission Certificates of Registration therefor, the Stock
and Transfer Books, the Stock Certificate Books and the
Minutes Books (or their equivalent) of the BVI Companies, the
Company and the Investee Companies, common seals and any other
papers and documents of the BVI Companies, the Company or the
Investee Companies in their possession;
(v) written confirmation that the Vendors and none of the Company
Directors or BVI Companies Directors are aware of any matter
or thing which is a breach of or inconsistent with any of the
Warranties;
(vi) a legal opinion in form and substance satisfactory to the
Purchaser issued by the Vendors' Lawyers confirming that the
particulars of the Company and the Investee Companies (set out
in Schedule 4)
13
(including without limitation, the particulars of the
registered shareholders and identity of the beneficial owners
of the Investee Companies, if different from the registered
shareholders) are true and accurate in all material aspects;
(vii) an irrevocable proxy in favour of the Purchaser in the
approved terms (executed by each Vendor separately) to allow
the Purchaser to vote in respect of the Sale Shares while
ownership by the Purchaser over the Sale Shares has not been
recorded in the books of the BVI Companies. Such proxy shall
lapse as soon as the ownership of the Purchaser over the Sale
Shares is recorded in the books of the BVI Companies;
(viii) the Shareholders Agreement duly executed by such persons as
the Vendors shall advise pursuant to Clause 3.1(a);
(ix) undated letters of resignation in the approved terms from all
the BVI Companies Directors;
(x) confirmation having been obtained, on terms satisfactory to
the Purchaser, from the corporate agent, the registered agent
and company secretary of each BVI Company that on the
Completion Date, the registers and other corporate records of
each BVI Company shall be updated to reflect that the
Purchaser shall be the sole shareholder in each BVI Company
and that such corporate agent, registered agent and company
secretary shall take instructions relating to the BVI
Companies only from the Purchaser or the Purchaser's
representatives;
(xi) a certified true copy of a resolution passed by the board of
directors of each BVI Company and AML Trading Limited, and
certified by its respective company secretary, approving the
execution of this Agreement and authorising Xxxxxx Xxxxxxx
Tanseco to negotiate and enter into this Agreement on the
terms herein and provide all necessary approvals, consents,
waivers, endorsements or other documents referred to in this
Agreement, in each case, on its behalf, and approving the
transfers of the Sale Shares in favour of the Purchaser;
(xii) a certified true copy of a resolution passed by the board of
directors of the Company, and certified by its company
secretary, approving the execution of this Agreement and
authorising Antonio Boglosa Villaruel to negotiate and enter
into this Agreement on the terms herein and provide all
necessary approvals, consents, waivers, endorsements or other
documents referred to in this Agreement on its behalf, and
approving the transfers of the Sale Shares in favour of the
Purchaser;
(xiii) the executed service agreements with the Continuing Employees
pursuant to Clause 4.1(f); and
(xiv) any other document required to vest title in the Sale Shares
to the Purchaser.
14
(b) do and execute or procure to be done and executed all such further
acts, deeds, documents and things as may be necessary to give effect
to the terms of this Agreement (including the sale of the Sale
Shares).
5.3 At Completion, the Purchaser shall:
(a) allot the Consideration Shares in accordance with Clause 3.1(a)
above, and shall deliver to the Vendors the share certificates in
respect of the Consideration Shares;
(b) deliver to the Vendors a bankers' draft for, or arrange for payment
by telegraphic transfer of, the sum of US$1,500,000 to AML Trading
Limited, or the bank account specified by AML Trading Limited in
writing to the Purchaser at least three business days before the
Completion Date (as the case may be);
(c) deliver to the Vendors the Promissory Note required to be delivered
under Clause 3.1(c) of this Agreement and the Shareholders Agreement
duly executed by it;
(d) deliver to the Vendors written confirmation that the Purchaser and
none of the directors of the Purchaser are aware of any matter or
thing which is a breach of or inconsistent with any of the
Purchaser's Warranties;
(e) to the extent that Completion takes place before 18 December 2002
and the instalment payment of US$5,000,000 due to be paid to the
shareholders of Viko Technology, Inc on 18 December 2002 pursuant to
the Viko Share Purchase Agreement ("RELEVANT VIKO INSTALLMENT")
shall not have been paid by the Purchaser, deliver an undertaking to
the Vendors that the Purchaser shall make payment of the Relevant
Viko Installment on or before 18 December 2002;
(f) deliver to the Vendors written confirmation from the financial
institution re-financing the Company's loan facilities referred to
in Clause 4.1(k) that the re-financing has been approved and will
proceed subject to satisfaction of any applicable conditions
precedent, including without limitation Completion of this
Agreement; and
(g) deliver to the Vendors any other document required to vest title in
the Consideration Shares to the Vendors.
For the purposes of this Clause 5.3, delivery to the Vendors of the items
required under Clauses 5.3(a) to 5.3(f) inclusive shall be satisfied by
the Purchaser making delivery to the Vendors' nominee, as advised by the
Vendors to the Purchaser prior to the Completion Date.
5.4 Without prejudice to any other remedies available to either the Purchaser
or the Vendors, if in any respect the provisions of Clause 5 are not
complied with by either the Purchaser or the Vendors on the Completion
Date, the non-defaulting party may:
15
(a) defer Completion to a date not more than 28 days after the
Completion Date (and so that the provisions of this Clause 5.4 shall
apply to Completion as so deferred);
(b) proceed to Completion so far as practicable (without prejudice to
its rights under this Agreement); or
(c) rescind this Agreement.
5.5 The parties agree and shall procure that upon Completion and for a period
of two years after Completion, the board of directors of the Company shall
be reconstituted and shall consist of:
(a) Xxxxxx Xxxxxxx Xxxxxxx (who shall also be appointed as chairman of
the board of Directors);
(b) Xxxxxxxx Xxxxx (who shall also be appointed as Chief Executive
Officer of the Company) or such other person as the Purchaser may
nominate; and
(c) three persons to be nominated by the Purchaser in compliance, and in
a manner consistent, with the laws of the Philippines.
Further, the parties agree, and shall procure that upon Completion, the
board of directors of each of the BVI Companies shall be reorganised
according to the Purchaser's instructions and in compliance, and in a
manner consistent with, the laws of the British Virgin Islands.
5.6 The parties agree that as soon as reasonably practicable after the
Completion Date, the Investee Companies shall be liquidated in accordance
with the laws of the Philippines.
6. OBLIGATIONS OF THE VENDORS
6.1 Each of the Vendors undertakes with the Purchaser that, except with the
consent in writing of the Purchaser and subject to the provisions of
Clause 6.3:
(a) for a period of three years after Completion with respect to Xxxxxx
Xxxxxxx Xxxxxxx and Xxxxxxx Boglosa Villaruel and for a period of
two years with respect to the other Vendors who as at the date of
this Agreement were employed by the Company, he will not within any
country in which any member of the Group or the Purchaser has
carried on business during the year preceding Completion either on
his own account or in conjunction with or on behalf of any person,
firm or company carry on or be engaged, concerned or interested,
directly or indirectly, whether as shareholder, partner, agent or
otherwise in carrying on any business which competes with the
business carried on by any member of the Group or the Purchaser at
Completion (other than (i) as a holder of shares in the Purchaser or
(ii) as a holder of not more than one per cent of the issued shares
or debentures of any company carrying on such a business listed on a
stock exchange);
16
(b) for a period of three years after Completion with respect to Xxxxxx
Xxxxxxx Xxxxxxx and Xxxxxxx Boglosa Villaruel and for a period of
two years with respect to the other Vendors who as at the date of
this Agreement were employed by the Company, he will not either on
his own account or in conjunction with or on behalf of any other
person, firm or company solicit or entice away or attempt to solicit
or entice away from any member of the Group or the Purchaser the
custom of any person, firm, company or organisation who shall at any
time within the year preceding Completion have been a customer,
identified prospective customer, representative, agent, or
correspondent of any member of the Group or the Purchaser, or in the
habit of dealing with any member of the Group or the Purchaser, or
enter into any contract for sale and purchase or accept business
from any such person, firm, company or organisation in a business
area in which any members of the Group or the Purchaser competes;
(c) for a period of three years after Completion with respect to Xxxxxx
Xxxxxxx Xxxxxxx and Xxxxxxx Boglosa Villaruel and for a period of
two years with respect to the other Vendors who as at the date of
this Agreement were employed by the Company, he will not either on
his own account or in conjunction with or on behalf of any other
person, firm or company employ, engage, solicit, entice away or
attempt to employ, engage, solicit or entice away from any member of
the Group or the Purchaser any person employed in a managerial,
supervisory, technical or sales capacity by, or engaged as a
consultant to, any member of the Group or the Purchaser at
Completion or at any time during the period of 12 months immediately
preceding Completion (whether or not such person would commit a
breach of contract by reason of leaving such employment or
engagement);
(d) he will not at any time hereafter make use of or disclose or divulge
to any person (other than to officers or employees of the Company or
any of the Investee Companies whose province it is to know the same)
any information (other than any information properly and generally
available to the public or disclosed or divulged pursuant to any
legal process of which is required to be disclosed or divulged
pursuant to or in accordance with the order of a court of competent
jurisdiction or of any Government Authority or pursuant to the
requirements of any stock exchange or securities council) relating
to any member of the Group or the Purchaser, the identity of their
customers and suppliers, their products, finance, contractual
arrangements, business or methods of business and shall use its best
endeavours to prevent the publication or disclosure of any such
information by any person, firm or company with which he is
connected or over which he has control (either directly or
indirectly);
(e) if, in connection with the business or affairs of any member of the
Group or the Purchaser, he shall have obtained Confidential
Information belonging to any third party under an agreement
purporting to bind any member of the Group or the Purchaser which
contained restrictions on disclosure, he will not without the
previous written consent of the Purchaser at any time infringe such
restrictions; and
17
(f) he will not at any time hereafter in relation to any trade, business
or company (save as a holder of shares in the Purchaser) use a name
or trade xxxx or any words confusingly similar thereto in such a way
as to be capable of or likely to be confused with the name or any
trade xxxx of any member of the Group or the Purchaser and shall use
his best endeavours to procure that no such name or trade xxxx shall
be used by any person, firm or company with which he is connected or
over which he has control (either directly or indirectly).
6.2 While the restrictions contained in this Clause 6 are considered by the
parties to be reasonable in all the circumstances, it is recognised that
restrictions of the nature in question may fail for technical reasons and
accordingly it is hereby agreed and declared that if any of such
restrictions shall be adjudged to be void as going beyond what is
reasonable in all the circumstances for the protection of the interests of
the Purchaser but would be valid if part of the wording thereof were
deleted or the periods thereof reduced or the range of activities or area
dealt with thereby reduced in scope the said restriction shall apply with
such modifications as may be necessary to make it valid and effective.
6.3 The restrictions contained in Clause 6.1 shall be without prejudice to
performance by and shall not limit the restrictions on the Continuing
Employees under the terms of agreements entered into pursuant to this
Agreement.
6.4 Notwithstanding anything else contained in this Agreement, the parties
agree that the Vendors are subject to the provisions set out in Schedule
7.
7. COVENANT IN RESPECT OF ENVIRONMENTAL MATTERS
7.1 Each of the Vendors hereby covenants with and undertakes to indemnify the
Purchaser and every member of the Group fully on demand and to keep them
indemnified against any and all penalties, fines and charges imposed on
any member of the Group by any relevant court order or judgment of a
Government Authority or other regulatory authority, or any and all
damages, liabilities, losses, costs and expenses incurred, suffered or
sustained by any member of the Group as a result of any relevant court
order or judgment or any relevant request or demand of a Philippine
Government Authority or other regulatory authority, and legal or
professional fees and disbursements reasonably incurred (on a full
indemnity basis) arising out of any of the following:
(a) any failure by any member of the Group to comply with all Philippine
Environmental Laws at any time on or before the Completion Date; or
(b) any discharge, release, leaching, emission, or escape into the
Environment on or before the Completion Date of any Hazardous
Substances or any substance regulated by Philippine Environmental
Law ("ENVIRONMENTAL BREACH") which has occurred or is occurring in
the conduct of the business of any member of the Group prior to the
Completion Date or in the conduct by any member of the Group of any
former business or in connection with or in relation to any assets
of any member of the Group or in connection with or in relation to
any
18
former assets of any member of the Group where such environmental
breach is proven to have occurred while such former assets were in
the ownership or under the control of any member of the Group; or
(c) any contamination of the Properties on or before the Completion Date
with any Hazardous Substances or substance regulated by Philippine
Environmental Law or any contamination of any other properties
previously used by any member of the Group or under the past
ownership, occupation or control of any member of the Group where
such contamination is proven to have occurred while such former
properties were in the ownership or under the control of any member
of the Group; or
(d) all Remedial Action resulting from or required in relation to any of
the matters referred to in Clauses 7.1(a) to 7.1(d) inclusive.
7.2 The Vendors shall, for a period of three years from the Completion Date,
give such assistance and provide such information to the Purchaser and the
relevant member of the Group as the Purchaser shall reasonably request
from time to time to enable the Purchaser or any member of the Group to
take Remedial Action or investigate the history of any matter giving rise
to any claim for indemnity hereunder or to make returns to and provide
information as required by any agency or statutory or Government Authority
having responsibility for any aspect of the Environment or Environmental
Law.
7.3 The liability of the Vendors under this Clause 7 shall cease after three
years from the Completion Date except in respect of matters which have
been the subject of a bona fide written claim made within the said period
by the Purchaser to the Vendors unless the claim in question has arisen by
reason of fraud, wilful concealment, dishonesty or deliberate
non-disclosure on the part of any of the Vendors prior to the Completion
Date in which event the time period within which such a claim or claims
may be brought shall be extended to ten years from the Completion Date.
8. PRE-COMPLETION OBLIGATIONS
8.1 The Vendors shall procure (subject to any express instructions from the
Purchaser) that from the date of this Agreement until Completion:
(a) the business of the Group is operated until Completion in the same
manner as it was operated hereto, in a prudent manner consistent
with past practices, and in the usual and ordinary course, and the
Vendors shall use their best efforts to preserve the goodwill of
suppliers, customers, creditors and others having business
relationships with the Group, and shall safeguard and preserve the
confidentiality of all books, records and information relating to
the Group in a prudent manner consistent with past practices;
(b) the Group's products are sold in regular quantities consistent with
past prudent trade practices and to inform the Purchaser of the
sales (both value and volume) of the Group on a weekly basis;
19
(c) the fixed assets of the Group are maintained in good condition,
repair and working order, normal wear and tear excepted;
(d) the Vendors shall have in effect and maintain at all times all
insurance now in force relating to the Group and the business and
assets of the Group;
(e) the Vendors shall use their best efforts to preserve and keep the
business organization of the Group intact, to keep available the
services of the present officers and employees of the Company;
(f) the Vendors shall allow the Purchaser, its representatives,
attorneys and accountants, to the extent necessary to determine the
operations of the Group, to have reasonable access to and copies of
the records and files, audits and properties of the Group relating
to the Group, the business and assets of the Group, as well as all
information relating to taxes, commitments, contracts, titles and
financial conditions of, or otherwise pertaining to, the Group, by
way of requests made through the Purchaser, the Purchaser's
authorized representatives, the Company's officers or key employees,
or the Purchaser's legal counsel. The Vendors agree to cause the
Group's accountants to cooperate with the Purchaser and its
accountants in making available all financial information concerning
the Group as requested, and the Purchaser and its accountants shall
have the right to examine all working papers pertaining to
examinations of the Group relating to the Group and its business and
assets, provided that such examinations shall not cause disruption
to the Group and its business and work force, and in any event,
shall be undertaken with reasonable prior notice and during normal
business hours of the Group;
(g) the Vendors shall maintain and/or obtain all government
authorizations and contractual and leasehold consents and permits
necessary to enable the consummation of all transactions
contemplated hereby or the continuation of the business of the
Group;
(h) the Vendors shall pay when due all national, local and other taxes
of the Group;
(i) the Vendors shall provide the Purchaser with (i) copies of any
financial statements prepared by the Group in the course of its
business, and (ii) cumulative and monthly management reports of the
Group's business (including statements of revenues and expenses),
promptly after they become available; and
(j) the Vendors shall notify the Purchaser immediately in the event of
any damage to or destruction of any of the material assets of the
Group;
8.2 The Vendors shall procure that, from the date of this Agreement until
Completion, no member of the Group shall, without the prior written
consent of the Purchaser:
20
(a) enter into or vary any contract or assume any liability which is
outside the ordinary or proper course of its business or which is
long term, unusual or onerous;
(b) enter into any capital commitment in a sum in excess of US$50,000 or
its equivalent in local currency (whether by way of purchase, lease,
hire purchase or otherwise);
(c) make any change in the nature, scope or organisation of its business
or dispose of the whole of its undertaking or property or a
substantial part thereof;
(d) acquire or form any subsidiary or acquire any shares in any company
or acquire the whole or any substantial part of the undertaking
assets or business of any other company or any firm or person or
enter into any joint venture or partnership with any other person;
(e) make any loans or grant any credit (other than credit given in the
normal course of trading and advances made to employees against
expenses incurred by them on its behalf);
(f) borrow any money (except borrowings from its bankers not exceeding
US$50,000 or its equivalent in local currency) or make any payments
out of or drawings on its bank accounts (except routine payments in
the ordinary course of business);
(g) enter into any guarantee, indemnity or surety or grant any security
over any of its assets or revenues;
(h) employ or engage, or make any offer of employment or engagement to,
any employee or consultant earning in excess of US$5,000 (or its
equivalent in local currency) per month, or make any changes
(whether immediate, conditional or prospective) in the terms of
employment (including, without limitation, in the amount or basis of
the emoluments or benefits) of any of its employees or in any
arrangements with its consultants;
(i) enter into any agreement, arrangement or understanding with any
trade union, works council, staff association or other employee
representative body in respect of any of the employees or directors
of any member of the Group;
(j) acquire or dispose of or grant any option or right of pre-emption in
respect of any material asset or any interest nor give nor receive
any service otherwise than at market value, or enter into, issue, or
grant any agreements, arrangements, warrants, calls, options,
convertible rights or other rights (vested or contingent) to acquire
any capital stock of the Group;
(k) acquire or dispose of any freehold or leasehold property or grant
any lease or third party right in respect of any of the Properties
or (subject to Clause 4.1(h) above) negotiate or agree to any review
of rent in respect of any lease of any of the Properties;
21
(l) enter into any leasing, hire purchase agreement or any agreement or
arrangement for payment on deferred terms;
(m) grant or enter into any licence, franchise or other agreement or
arrangement concerning any part of its name, trading names or
know-how;
(n) declare, make or pay any dividend or distribution on account of any
of the Sale Shares or redeem, purchase or otherwise acquire any of
the Sale Shares, or issue, sell or dispose of any option, warrant or
right to acquire any shares of capital stock of the Group;
(o) incur or pay any management charges;
(p) permit any of its insurances to lapse or do anything which would
make any policy of insurance void or voidable;
(q) make any payments to any of the Vendors or parties related to, or
associated with, the Vendors.
(r) apply for, surrender or agree any variations to any Environmental
Licences;
(s) make any change in the accounting practices or procedures governing
any member of the Group;
(t) amend the Articles of Incorporation or By-Laws (or other
constitutive documents) of any member of the Group;
(u) initiate or enter into or cause the Group's officers, directors,
employees, agents and affiliates to initiate or enter into, any
negotiations or solicit or discuss or encourage (and including by
way of furnishing non-public information) any offer or proposal
regarding the sale, direct or indirect, of any of the Sale Shares,
the sale, direct or indirect, of any of the assets of any member of
the Group (other than inventory in the ordinary course of business),
the issuance of any capital stock of any member of the Group or any
options, warrants, or rights to acquire capital stock of any member
of the Group, or any merger, consolidation or similar transaction
involving the Sale Shares or any of the assets of any member of the
Group with any party other than the Purchaser or an affiliate of the
Purchaser. The Vendors shall promptly notify the Purchaser of any
such proposal or offer, or any inquiry or contact with any person
with respect thereto, and terms thereof; or
(v) agree, conditionally or otherwise, to do any of the foregoing.
8.3 As from the date of this Agreement, the Vendors shall give and shall
procure that the Purchaser and/or any persons authorised by it will be
given such access to the premises and all books, title deeds, records and
accounts of the BVI Companies, the Company and the Investee Companies as
the Purchaser may reasonably request and be permitted to take copies of
any such books, deeds, records and accounts and that
22
the directors and employees of the BVI Companies, the Company and the
Investee Companies shall be instructed to give promptly all such
information and explanations to any such persons as aforesaid as may be
requested by it or them.
8.4 The Purchaser shall procure (subject to any express instructions from the
Vendors) from the date of this Agreement until Completion:
(a) that the business of the Purchaser is operated until Completion in
the same manner as it was operated hereto, in a prudent manner
consistent with past practices, and in the usual and ordinary
course, and the Purchaser shall use its best efforts to preserve the
goodwill of suppliers, customers, creditors and others having
business relationships with the Purchaser, and shall safeguard and
preserve the confidentiality of all books, records and information
relating to the Purchaser in a prudent manner consistent with past
practices;
(b) the maintenance of all government authorizations and contractual and
leasehold consents and permits necessary to enable the consummation
of all transactions contemplated hereby or the continuation of the
business of the Purchaser and Viko Technology, Inc.;
(c) the payment when due of all national, local and other taxes of the
Purchaser or Viko Technology, Inc.;
(d) the notification to the Vendors immediately in the event of any
damage to or destruction of any of the material assets of the
Purchaser or Viko Technology, Inc.; and
(e) the notification to the Vendors immediately of any matter, event or
circumstance (including any omission to act) which may arise or
become known to it which has, or is likely to have, an adverse
effect on the financial position or prospects of the Purchaser.
8.5 The Purchaser shall procure that, from the date of this Agreement until
Completion, the Purchaser shall not, without the prior written consent of
the Vendors:
(a) make any change in the nature, scope or organisation of its business
or dispose of the whole of its undertaking or property or a
substantial part thereof;
(b) acquire or form any subsidiary or acquire any shares in any company
or acquire the whole or any substantial part of the undertaking
assets or business of any other company or any firm or person or
enter into any joint venture or partnership with any other person;
(c) acquire or dispose of or grant any option or right of pre-emption in
respect of any material asset or any interest nor give nor receive
any service otherwise than at market value, or enter into, issue, or
grant any agreements, arrangements, warrants, calls, options,
convertible rights or other rights (vested or contingent) to acquire
any capital stock of the Purchaser or Viko Technology, Inc.;
23
(d) declare, make or pay any dividend or distribution or redeem,
purchase or issue, sell or dispose of any option, warrant or right
to acquire any shares of capital stock of the Purchaser or Viko
Technology, Inc.;
(e) agree, conditionally or otherwise, to do any of the foregoing.
9. CONFIDENTIALITY
9.1 Each of the parties to this Agreement undertakes with the other parties
that it will not (save as required by law or by any securities exchange or
any supervisory or regulatory body to whose rules any party to this
Agreement is subject) make any announcement in connection with this
Agreement unless the other parties shall have given their consent to such
announcement (which consent may not be unreasonably withheld or delayed
and may be given either generally or in a specific case or cases and may
be subject to conditions). For the avoidance of doubt, it shall be
reasonable for a party to withhold its consent if Completion has not
occurred.
9.2 Each party to this Agreement undertakes with the other parties that it
shall treat as strictly confidential all information received or obtained
by it or its employees, agents or advisers as a result of entering into or
performing this Agreement including information relating to the provisions
of this Agreement, the negotiations leading up to this Agreement, the
subject matter of this Agreement or the business or affairs of the
Vendors, the Group or the Purchaser, and subject to the provisions of
Clause 9.3, that it will not at any time hereafter make use of or disclose
or divulge to any person any such information and shall use its best
endeavours to prevent the publication or disclosure of any such
information.
9.3 The restrictions contained in Clauses 9.1 and 9.2 shall not apply so as to
prevent any party from making any disclosure required by law or by any
securities exchange or supervisory or regulatory or Government Authority
pursuant to rules to which the relevant party is subject or from making
any disclosure to any professional adviser for the purposes of obtaining
advice (provided always that the provisions of this Clause 9 shall apply
to and such disclosing party shall procure that they apply to and are
observed in relation to, the use or disclosure by such professional
adviser of the information provided to him) nor shall the restrictions
apply in respect of any information which comes into the public domain
otherwise than by a breach of this Clause 9 by any party.
10. COSTS
10.1 Subject to Clause 10.2 below, the parties agree that the Company shall pay
for the costs of the Vendors in relation to the preparation and
negotiation of this Agreement and the sale and purchase hereby agreed to
be made subject to a maximum of US$350,000, provided that the parties are
able to agree on an estimated list of costs to be borne by the Company
pursuant to this Clause 10.1 prior to Completion.
10.2 The parties agree that the costs relating to the conduct of the legal and
financial due diligence on the BVI Companies and AML Trading Limited by
the Purchaser
24
(including without limitation the costs of a legal opinion to be issued by
the Purchaser's British Virgin Islands counsel on the BVI Companies and
AML Trading Limited), shall be borne by the Vendors subject to a maximum
of US$18,000.
11. GENERAL
11.1 This Agreement shall be binding upon and enure for the benefit of the
estates, personal representatives or successors of the parties.
11.2 This Agreement (together with any documents referred to herein or executed
contemporaneously by the parties in connection herewith) constitutes the
whole agreement between the parties hereto and supersedes any previous
agreements or arrangements between them relating to the subject matter
hereof; it is expressly declared that no variations hereof shall be
effective unless made in writing signed by duly authorised representatives
of the parties.
11.3 All of the provisions of this Agreement shall remain in full force and
effect notwithstanding Completion (except insofar as they set out
obligations which have been fully performed at Completion).
11.4 If any provision or part of a provision of this Agreement shall be, or be
found by any authority or court of competent jurisdiction to be, invalid
or unenforceable, such invalidity or unenforceability shall not affect the
other provisions or parts of such provisions of this Agreement, all of
which shall remain in full force and effect.
11.5 Any right of rescission conferred upon the Purchaser hereby shall be in
addition to and without prejudice to all other rights and remedies
available to it (and, without prejudice to the generality of the
foregoing, shall not extinguish any right to damages to which the
Purchaser may be entitled in respect of the breach of this Agreement) and
no exercise or failure to exercise such a right of rescission shall
constitute a waiver by the Purchaser of any such other right or remedy.
11.6 No failure of the Purchaser to exercise, and no delay or forbearance in
exercising, any right or remedy in respect of any provision of this
Agreement shall operate as a waiver of such right or remedy.
11.7 Upon and after Completion, the Vendors shall do and execute or procure to
be done and executed all such further acts, deeds, documents and things as
may be necessary to give effect to the terms of this Agreement and to
place control of the BVI Companies, the Company and the Investee Companies
in the hands of the Purchaser (including without limitation, co-operating
with the Purchaser and/or the Company in making all relevant filings or
notifications required by any authority to the sale of the Sale Shares)
and pending the doing of such acts, deeds, documents and things the
Vendors shall as from Completion hold the legal estate in the Sale Shares
in trust for the Purchaser.
11.8 At the request of the Purchaser, the Vendors shall execute under seal a
power of attorney in favour of the Purchaser or such person as may be
nominated by the
25
Purchaser generally in respect of the Sale Shares and in particular to
enable the Purchaser (or its nominees) to attend and vote at general
meetings of the Company.
11.9 This Agreement may be executed in one or more counterparts, and by the
parties on separate counterparts, but shall not be effective until the
signing of the last counterpart and each party has executed at least one
counterpart and each such counterpart shall constitute an original of this
Agreement but all the counterparts shall together constitute one and the
same instrument. Each counterpart may be executed by the parties and
transmitted by facsimile transmission and shall be as valid and effectual
as if executed as an original.
11.10 The Singapore Contracts (Rights of Third Parties) Act 2001 (the "CRTP
ACT") shall not apply to this Agreement and no person not party to this
Agreement shall have or acquire any right to enforce any term of it
pursuant to the CRTP Act. This Clause 11.10 shall not affect any right or
remedy of any third party which exists or is available otherwise than by
reason of the CRTP Act and shall prevail over any other provision of this
Agreement which is inconsistent with it.
11.11 The Vendors may assign their rights under this Agreement to the nominees
that will hold the Consideration Shares provided that they promptly serve
notice on the Purchaser to this effect. Otherwise, none of the parties may
assign their rights or transfer their obligations under this Agreement
without the prior written consent of the other parties (such consent not
to be unreasonably withheld or delayed).
12. NOTICES
12.1 Save as otherwise provided in this Agreement any notice, demand or other
communication to be served under this Agreement shall be in writing in the
English language and shall be served upon any party hereto only by posting
by registered mail (if to an address in the same country) or air mail (if
to an address in a different country) or delivering the same by hand or by
courier, to its address given or referred to in this clause or sending the
same by facsimile transmission to the number given in this clause for the
addressee or at such other address or number as it may from time to time
notify in writing to the other parties hereto.
12.2 A notice, demand or other communication served by registered mail shall be
deemed duly served on an address in the same country 48 hours
(disregarding days which are not business days) after posting, a notice,
demand or other communication served by air mail shall be deemed duly
served on an addressee in a different country five business days after
posting and a notice, demand or other communication sent by facsimile
transmission shall be deemed to have been served at the time of
transmission (save that if the transmission occurs after 6.00 p.m. the
notice, demand or other communication shall be deemed to have been served
at 8.30 a.m. on the next business day following transmission) and in
proving service of the same it will be sufficient to prove, in the case of
a letter, that such letter was left at or delivered to the correct address
of the party to be served as provided in this Agreement or, in the case of
properly stamped or franked registered mail or air mail, addressed to the
address of the party to be served given in this Clause and placed in the
post and, in the case of facsimile transmission, that such facsimile was
duly transmitted to the number of the
26
party to be served given in this Clause and an electronic acknowledgement
was received.
12.3 All notices, demands or other communications given under this Agreement,
shall be given to the following addresses:
If to the Vendors: collectively care of Xxxxxx
Xxxxxxx Xxxxxxx at his address and/or
facsimile number stated in Schedule 1;
If to the Purchaser: 00 Xxxx Xxxxx Xxxxxxxx, #00-00,
Xxxxxxxxx 000000
Facsimile: (00) 0000 0000
Attention: Xxxxxxxx Xxxxx / Kong Kah Chin
If to the Company: 00 Xxxx Xxxxx Xxxxxxxx, #00-00,
Xxxxxxxxx 000000
Facsimile: (00) 0000 0000
Attention: Xxxxxxxx Xxxxx / Kong Kah Chin
If to the BVI Companies: 00 Xxxx Xxxxx Xxxxxxxx, #00-00,
Xxxxxxxxx 000000
Facsimile: (00) 0000 0000
Attention: Xxxxxxxx Xxxxx / Kong Kah Chin
12.4 For the purposes of this Clause "BUSINESS DAY" means a day (other than a
Saturday or a Sunday) on which banks are generally open for business in
Singapore.
13. GOVERNING LAW AND DISPUTE RESOLUTION
This Agreement shall be governed by and construed in accordance with the laws of
Singapore. Any dispute arising out of or in connection with this Agreement or
the Promissory Note, including any question regarding their existence, validity
or termination, shall be referred to and finally resolved by arbitration in
Singapore in accordance with the Arbitration Rules of the Singapore
International Arbitration Centre ("SIAC RULES") for the time being in force
which rules are deemed to be incorporated by reference into this clause.
SCHEDULE 1
DETAILS OF THE VENDORS
FINETECH INTERNATIONAL LIMITED
27
COLUMN 1 COLUMN 2
NUMBER OF SALE SHARES (OF PAR
NAME AND ADDRESS DETAILS OF THE VENDORS VALUE US$1.00 EACH) IN RELATION TO FINETECH
OF FINETECH INTERNATIONAL LIMITED INTERNATIONAL LIMITED
Xxxxxx Xxxxxxx Xxxxxxx 1,593,760
Address: 0000 Xxxxxxxxx Xxxxxx,
Xxxxxxxxxx Xxxxxxx, Xxxxxx Xxxx,
Fax: (000) 000 0000 Philippines
Antonio Boglosa Villaruel 10
Xxxxxxx Xxxxxxxxxx Xxxxxxxxxx 10
Mila Xxxxxx Xxxxxxx 637,500
TOTAL 2,231,280
GOLD XXXX LIMITED
COLUMN 1 COLUMN 2
NUMBER OF SALE SHARES (OF PAR
NAME AND ADDRESS DETAILS OF THE VENDORS VALUE US$1.00 EACH)IN RELATION TO GOLD XXXX
OF GOLD XXXX LIMITED LIMITED
Xxxxxx Xxxxxxx Tanseco 10
Antonio Boglosa Villaruel 1,593,760
Xxxxxxx Xxxxxxxxxx Xxxxxxxxxx 10
Xxxxxxx X. Xxxxx 1,250
TOTAL 1,595,030
GLOBAL CROWN LIMITED
28
COLUMN 1 COLUMN 2
NUMBER OF SALE SHARES (OF PAR VALUE
NAME AND ADDRESS DETAILS OF THE VENDORS US$1.00 EACH)IN RELATION TO GLOBAL
OF GLOBAL CROWN LIMITED CROWN LIMITED
AML Trading Limited 100
TOTAL 100
MAYON CAPITAL LIMITED
COLUMN 1 COLUMN 2
NUMBER OF SALE SHARES (OF PAR VALUE
NAME AND ADDRESS DETAILS OF THE VENDORS US$1.00 EACH) IN RELATION TO MAYON
OF MAYON CAPITAL LIMITED CAPITAL LIMITED
Xxxxxx Xxxxxxx Xxxxxxx 10
Antonio Boglosa Villaruel 10
Xxxxxxx Xxxxxxxxxx Xxxxxxxxxx 17,760
Xxxxxx Xxxxxx L. Xxx 5,000
Xxxxxxxx Xx Del Xxxxxxx 2,500
Xxxxxxx Xxxxxxxx Xxxxxx 2,000
Xxxxxx Xxxxx Flavier 1,250
TOTAL 28,530
29
SCHEDULE 2
BRIEF DETAILS OF THE COMPANY AND THE BVI COMPANIES
THE COMPANY
1. Registered number: ASO96-002117
2. Address of registered office: Light Industry and Science Park of the
Philippines, Cabuyao, Laguna, Philippines
3. Date and place of incorporation: 26 February 1996 / The Philippines
4. Authorised capital stock: PHP1,250,000,000
5. Issued stock capital: PHP632,019,564
6. Directors: Xxxxxx Xxxxxxx Xxxxxxx, Xxxxxxx Boglosa Xxxxxxxxx, Xxxx Xxxxxxx
X. Xxxxxxxx, Xxxxxxx X. Xxxxxxxx, Xxxxxx X. Xxxxxxx, Xxxxxxxxx X.
Xx-Xxxxx, Xxxxxxx X. Xxxxxx
7. Secretary: Odette Xxxxxxxx X. Padre
8. Financial year end: 31 December
9. Current auditors: Xxxxxxx Xxxxxxx & Co.
FINETECH INTERNATIONAL LIMITED
1. International Business Company number: 317784
2. Address of registered office: Beaufort House, Tropic Isle Building, PO Box
438, Road Town, Tortola, British Virgin Islands
3. Date and place of incorporation: 23 March 1999 / British Virgin Islands
4. Registered agent: JAI Services Limited of Beaufort House, Tropic Isle
Building, PO Box 438, Road Town, Tortola, British Virgin Islands
5. Authorised capital: US$2,750,000
6. Issued capital: US$2,231,280
7. Directors: Xxxxxx Xxxxxxx Xxxxxxx, Xxxx Xxxxxx Xxxxxxx
8. Secretary: Shouson Limited
30
GLOBAL CROWN LIMITED
1. International Business Company number: 177098
2. Address of registered office: Beaufort House, Tropic Isle Building, PO Box
438, Road Town, Tortola, British Virgin Islands
3. Date and place of incorporation: 27 February 1996 / British Virgin Islands
4. Registered agent: JAI Services Limited of Beaufort House, Tropic Isle
Building, PO Box 438, Road Town, Tortola, British Virgin Islands
5. Authorised capital: US$3,000,000
6. Issued capital: US$100
7. Directors: Xxxxxx Xxxxxxx Tanseco, Mila Xxxxxx Xxxxxxx
8. Secretary: Shouson Limited
MAYON CAPITAL LIMITED
1. International Business Company number: 297541
2. Address of registered office: Beaufort House, Tropic Isle Building, PO Box
438, Road Town, Tortola, British Virgin Islands
3. Date and place of incorporation: 15 October 1998 / British Virgin Islands
4. Registered agent: JAI Services Limited of Beaufort House, Tropic Isle
Building, PO Box 438, Road Town, Tortola, British Virgin Islands
5. Authorised capital: US$500,000
6. Issued capital: US$28,530
7. Directors: Xxxxxx Xxxxxxx Xxxxxxx, Xxxxxxx Boglosa Villaruel, Xxxxxxx
Xxxxxxxxxx Xxxxxxxxxx
8. Secretary: Shouson Limited
31
GOLD XXXX LIMITED
1. International Business Company number: 334702
2. Address of registered office: Beaufort House, Tropic Isle Building, PO Box
438, Road Town, Tortola, British Virgin Islands
3. Date and place of incorporation: 19 July 1999 / British Virgin Islands
4. Registered agent: JAI Services Limited of Beaufort House, Tropic Isle
Building, PO Box 438, Road Town, Tortola, British Virgin Islands
5. Authorised capital: US$2,000,000
6. Issued capital: US$1,595,030
7. Directors: Antonio Boglosa Villaruel, Xxxxxxx Xxxxxxxxxx Xxxxxxxxxx
8. Secretary: Shouson Limited
32
SCHEDULE 3
SHAREHOLDING OF THE PURCHASER (REFERRED TO IN CLAUSE 3.2)
The shareholding structure as referred to in Clause 3.2 will be as follows:
NUMBER OF A NUMBER OF A NUMBER OF NUMBER OF
PREFERENCE ORDINARY ORDINARY OPTIONS
PARTY SHARES HELD SHARES HELD SHARES HELD HELD
3i Group plc and 3i Asia Pacific
Technology LP collectively 2,626,530 6,128,570 750,000 -
EDB Investments Pte Ltd 1,969,899 4,596,427 - -
The Purchaser's management - - 4,928,570 1,200,653
Koh Boon Hwee - 125,000 -
The Purchaser's Independent
Director - - - 92,358
AML Trading Limited - - 2,662,304 -
Nominees of the Vendors - - 1,780,195 454,369
TOTAL 4,596,429 10,724,997 10,246,069 1,747,380
Note: For the avoidance of doubt, the Purchaser also has two issued and paid up
shares of par value S$1.00 (Singapore dollars) each in its capital not reflected
in the table in this Schedule 3.
33
SCHEDULE 4
THE INVESTEE COMPANIES
ATEC-KMI PHILIPPINES, INC.
XXX Xxxxxxxxxxxx Xx. X0000-0000
Principal office: Special Export Processing Zone, Light and
Industry Science Park, Cabuyao, Laguna, Philippines.
Percentage of
No. of Shares Total Issued and
Name Citizenship Subscribed Paid Up Capital
Automated Technology
(Phil.) Inc. ("ATEC") Filipino 194,997 50%
Mayon Capital Limited Filipino 194,998 50%
Xxxxxx X.arfori
Xxxxxxx
(in trust for ATEC) Filipino 1 -
Antonio Boglosa
Villaruel
(in trust for ATEC) Filipino 1 -
Xxxxxxx Xxxxxxxxxx
Xxxxxxxxxx
(in trust for ATEC) Filipino 1 -
Xxxx Xxxxxxx X.
Xxxxxxxx
(in trust for Mayon
Capital Ltd.) Filipino 1 -
Xxxxxxx Xxxxxxxx
(in trust for Mayon
Capital Ltd.) Filipino 1 -
TOTAL 390,000 100%
34
BLUE SKY INTEGRATED DESIGNS, INC.
SEC Registration No. A199918679
Principal office: Light Industry and Science Park of the Philippines, Cabuyao,
Laguna, Philippines
No. of Shares Amount Amount
Name Citizenship Subscribed Subscribed Paid
Automated Technology
(Phil.) Inc. Filipino 124,995 PHP 12,499,500 PHP 3,124,875
Xxxxxx Xxxxxxx Xxxxxxx Filipino 1 100 25
Antonio Boglosa Filipino 1 100 25
Villaruel
Xxxxxxx Xxxxxxxxxx Filipino 1 100 25
Xxxxxxxxxx
Xxxxxxx X. Xxxxx, Xx. Xxxxxxxx 0 000 00
Xxxxxx X. Xxx American 1 100 25
TOTAL 125,000 PHP12,500,000.00 PHP3,125,000.00
35
SCHEDULE 5
THE PROPERTIES
PART I - FREEHOLD PROPERTIES
DESCRIPTION OF PROPERTY OWNER
None
PART II - LEASEHOLD PROPERTIES
DESCRIPTION OF PROPERTY OWNER
1. Two-storey steel and concrete Stancrest Realty Corporation
building shell built on land covered
by Torrens Certificate of Title
No. T-356454 situated in the
Light Industry & Science Park
of the Philippines
2. Annex Building situated on parcels of Stancrest Realty Corporation
and covered by Torrens Certificates
of Title No. T-356454 and T-383008
and an Accretion Lot to be titled and
acquired by Stancrest Realty Corporation
36
SCHEDULE 6
CONTINUING EMPLOYEES
1. Antonio Boglosa Villaruel
2. Xxxxxxx Xxxxxxxxxx Xxxxxxxxxx
3. Xxxxxxxxx X. del Val
4. Xxxx Xxxxxxx X. Xxxxxxxx
5. Xxxxxxx X. Xxxxxx
6. Xxxxxxxx X. del Xxxxxxx
7. Xxxxxx Xxxxxx L. Xxx
37
SCHEDULE 7
WARRANTIES OF THE VENDORS
(a) Each of the Vendors jointly and severally represents, warrants and
undertakes to and with the Purchaser that each of the statements set out
in Parts One to Three inclusive of this Schedule 7 will at Completion be
true and accurate.
(b) The Warranties are given subject to matters fully, fairly and specifically
disclosed in the Disclosure Letter but no other information relating to
the BVI Companies, the Company or the Investee Companies of which the
Purchaser has knowledge (actual or constructive) and no investigation by
or on behalf of the Purchaser shall prejudice any claim made by the
Purchaser under the Warranties or operate to reduce any amount
recoverable, and liability in respect thereof shall not be confined to
breaches discovered before Completion. No letter, document or other
communication shall be deemed to constitute a disclosure for the purposes
of this Agreement unless the same is accepted as such by the Purchaser and
is expressly referred to in the Disclosure Letter.
(c) The Vendors acknowledge that the Purchaser has entered into this Agreement
in reliance upon the Warranties.
(d) Without restricting the rights of the Purchaser or otherwise affecting the
ability of the Purchaser to claim damages on any other basis available to
it (save for a claim or claims arising in relation to the Warranties by
reason of fraud, wilful concealment, dishonesty or deliberate
non-disclosure on the part of any of the Vendors or on the part of any
officer or representative of any Vendor or any member of the Group prior
to the Completion Date, in which event there shall be no limit on the
amount recoverable by the Purchaser from the Vendors in respect of such
claim or claims and the time period within which such a claim or claims
may be brought shall be extended to ten years from the Completion Date),
the Vendors hereby undertake, for so long as the Vendors' liability under
the Warranties survive pursuant to Clause (l) below of this Schedule 7, to
indemnify and keep indemnified the Purchaser (for itself and as trustees
for the BVI Companies, the Company and the Investee Companies) and their
officers, directors, employees, agents and shareholders (collectively, the
"INDEMNIFIED PURCHASERS") against:
(i) any loss or liability suffered by any of the Indemnified Purchasers
as a result of, arising from or in connection with any breach of any
of the Warranties including, but not limited to, any dimunition in
the value of the Sale Shares and any payment made or required to be
made by the Indemnified Purchasers and any costs, expenses, fines,
penalties and Taxes incurred as a result of such breach. For the
purposes of this Clause (d)(i), any dimunition in value of the Sale
Shares will be determined by reference to the fair market value of
the Sale Shares. The fair market value will be determined by an
independent third party valuer to be appointed by agreement by the
Vendors and the Purchaser. In the event that there is any
disagreement on the valuer, either the Vendors or the Purchaser may
request the President of the Institute of Certified Public
38
Accountants of Singapore to decide on the valuer. The Vendors and
the Purchaser shall engage the valuer on his standard terms and
conditions;
(ii) all costs and expenses properly and reasonably incurred by any of
the Indemnified Purchasers in connection with or as a result of such
breach and any costs (including legal costs on a solicitor and own
client basis), expenses or other liabilities which any of them may
incur either before or after the commencement or any action in
connection with (1) any legal proceedings in which any of the
Indemnified Purchasers claims that any of the Warranties has been
broken or is untrue and in which judgement is given for any of the
Indemnified Purchasers; or (2) the enforcement of any settlement of,
or judgement in respect of, such claim; and
(iii) (notwithstanding Clause (b) in this Schedule 7 and anything
contained in the Disclosure Letter) any loss or liability suffered
by any of the Indemnified Purchasers arising, directly or
indirectly, from and in connection with:
(1) any actions or claims brought by the relevant authorities in
the relevant jurisdiction relating to any violation of
applicable laws, rules and regulations by any member of the
Group prior to Completion;
(2) without limiting the generality of Clause (d)(iii)(1) in this
Schedule 7, any failure by the Company or any of the Investee
Companies to comply with all applicable laws, rules and
regulations in the Philippines or to hold all relevant
licences, permits and registrations (including any default in
renewal of such licences, permits and registrations) which are
required for their operations prior to Completion;
(3) any actions or claims occurring or made prior to the
Completion Date by any employee, agent or consultant of the
Company or any of the Investee Companies for loss, damage or
injury sustained in the course of work and for which the
Company or the relevant Investee Company is not adequately
insured against;
(4) any Tax liability (including without limitation liability for
withholding tax, real property tax or income tax) imposed on
any member of the Group by any Tax authority referrable to, or
in respect of, the period up to Completion arising from or due
to the Company or the relevant Investee Company's default,
omission or deficiency in meeting Tax payments or obligations
(provided always that the Vendors shall have the right to
request an administrative or judicial review of such Tax
liability and to exhaust all applicable appeal procedures,
with all costs arising from such review and appeals (including
without limitation all legal costs) to be borne by such
Vendors). For this purpose, the Purchaser shall procure that
within five business days of the receipt of an assessment from
any Tax authority, it shall notify the Vendors who shall have
a period of five business days to advise the Company that it
wishes to challenge the assessment and if the Vendors choose
to do so,
39
the Vendors shall have a further ten business days in which to
lodge a protest on behalf of the Company and then to pursue
such action up to its final adjudication or judgment;
(5) any liability imposed on any member of the Group arising from
any court order or judgment or any relevant request or demand
by any Government Authority relating to or arising from any
applicable Environmental Law (other than Philippine
Environmental Law) where the event giving rise to the
liability occurred before the Completion Date;
(6) any actions or claims in connection with the following
specific due diligence items in respect of all liabilities
arising prior to Completion or attributable to the period up
to Completion:
(A) any failure of the Company to meet projected
production and sales commitments under its Registration
Agreement with the Philippine Economic Zone Authority
which may affect the Company's entitlement to incentives
as an Ecozone Export Enterprise;
(B) any failure to comply fully with the requirements of
the Philippine Occupational Safety and Health Standards
in relation to the provision of (i) occupational health
physicians, (ii) a full time dentist, (iii) full time
occupational health nurses, (iv) full time first aiders
and (v) emergency medical and dental clinic;
(C) any failure to comply fully with the requirements
under the Social Security Law of 1997, National Health
Insurance Act of 1995 and Pag-IBIG Fund law in relation
to its employees;
(D) any loss or damage to consigned equipment,
furniture and fixtures in the Company's control and/or
possession from its customers which are necessary for
the Company's business;
(E) any liability arising out of the shareholders'
agreement entered into with Korea Microsystems, Inc on 3
December 1996 in relation to the joint venture in
ATEC-KMI Philippines, Inc (an Investee Company); and
(F) any liability arising out of any stock option
arrangement in existence prior to Completion available
to officers and/or employees of the Company.
(e) Each of the Warranties shall be separate and independent and save as
expressly provided to the contrary, shall not be limited by reference to
or inference from any
40
other Warranty or any other term of this Agreement, nor by anything in the
Disclosure Letter which is not expressly referenced to the Warranty
concerned.
(f) Where any statement in the Warranties or any confirmation or certificate
given by any of the Vendors hereunder or pursuant hereto is qualified by
the expression "so far as the Vendors are aware" or "to the best of the
Vendors' knowledge and belief" or any similar expression, that statement
shall be deemed to include an additional statement that it has been made
after due and careful enquiry.
(g) Each of the Vendors hereby agrees with the Purchaser (for itself and as
trustee for each of the BVI Companies, the Company and each of the
Investee Companies) to waive any rights which it may have in respect of
any misrepresentation or inaccuracy in, or omission from, any information
or advice supplied or given by the BVI Companies, the Company or its
Investee Companies or their officers, employees or advisers in connection
with the giving of the Warranties and the preparation of the Disclosure
Letter.
(h) The Vendors shall procure that (save only as may be necessary to give
effect to this Agreement) neither they nor any member of the Group shall
do, allow or procure any act or omission before Completion which would
constitute a breach of any of the Warranties or which would make any of
the Warranties inaccurate or misleading.
(i) Each of the Vendors hereby agrees to disclose to the Purchaser in writing
immediately upon becoming aware of the same, any matter, event or
circumstance (including any omission to act) which may arise or become
known to it after the date of this Agreement and before Completion which
has, or is likely to have, an adverse effect on the financial position or
prospects of any member of the Group.
(j) The Vendors shall give to the Purchaser after Completion all such
information and documentation relating to the Group as the Purchaser shall
reasonably require to enable it to satisfy itself as to the accuracy and
due observance of the Warranties.
(k) The benefit of the Warranties may be assigned in whole or in part and
without restriction by the person for the time being entitled thereto,
provided that prior notification has been given by the Purchaser to the
Vendors in writing of such intention to assign the benefit of the
Warranties.
(l) The liabilities of the Vendors under the Warranties:
(i) shall save in relation to:
(1) paragraphs 3.1 to 3.8 inclusive of Part One of Schedule 7
below (collectively, the "TAX WARRANTIES") and paragraphs 16.1
to 16.8 inclusive of Part Two of Schedule 7 below
(collectively, the "BVI TAX WARRANTIES"); and
(2) paragraphs 4.2, 4.3, 4.4 and 4.5 of Part One of Schedule 7,
and paragraphs 15.2, 15.3, 15.4 and 15.5 of Part Two of
Schedule 7 below,
41
cease after three years from the Completion Date except in
respect of matters which have been the subject of a bona fide
written claim made before such date by the Purchaser or the
Purchaser's Lawyers to the Vendors or the Vendors' Lawyers;
(ii) shall in relation to the Tax Warranties cease after three
years from the date of the filing of the relevant Tax return
by the Company to the applicable Tax authority for the Tax and
financial year ending 31 December 2002 and in relation to the
BVI Tax Warranties cease after six years from the Completion
Date, except in each case in respect of matters which have
been the subject of a bona fide written claim made before such
date by the Purchaser or the Purchaser's Lawyers to the
Vendors or the Vendors' Lawyers;
(iii) shall be limited to the aggregate value of the amounts paid
under Clauses 3.1(b) and 3.1(c) of this Agreement. After
Completion Date and up to and including the second anniversary
of the Completion Date, the Vendors's liability in relation to
the Warranties (in respect of which a bona fide written claim
has been made before the second anniversary of the Completion
Date by the Purchaser or the Purchaser's Lawyers to the
Vendors or the Vendors' Lawyers) shall be limited to a maximum
aggregate amount of US$8,000,000. From the second anniversary
of the Completion Date onwards, the Vendors' liability in
relation to the Warranties shall be limited to a maximum
aggregate amount of US$5,000,000. In addition, the Vendors
shall not incur any liability until the aggregate amount of
all liabilities, exceeds US$100,000 (the "BASKET"), at which
point, the Vendors shall be liable for the complete amount of
all liabilities, including, without limitation US$100,000 of
the Basket,
save (in all instances in Clauses l(i) to l(iii) above inclusive)
for a claim or claims in relation to the Warranties arising by
reason of fraud, wilful concealment, dishonesty or deliberate
non-disclosure on the part of any of the Vendors or on the part of
any officer or representative of any Vendor or any member of the
Group prior to the Completion Date, in which event there shall be no
limit on the amount recoverable by the Purchaser from the Vendors in
respect of such claim or claims and the time period within which
such a claim or claims may be brought shall be extended to ten years
from the Completion Date.
(m) If any sum payable by the Vendors under or pursuant to this Schedule
7 shall be subject to Tax (whether by way of deduction or
withholding or direct assessment of the person entitled thereto)
such payment shall be increased by such an amount as shall ensure
that after deduction, withholding or payment of such Tax the
recipient shall have received a net amount equal to the payment
otherwise required hereby to be made.
PART ONE
WARRANTIES REGARDING ATEC
42
IN PART ONE OF THIS SCHEDULE UNLESS THE CONTEXT OTHERWISE INDICATES EACH OF THE
WARRANTIES SHALL BE DEEMED TO BE REPEATED MUTATIS MUTANDIS IN RELATION TO EACH
COMPANY IN THE GROUP.
1. THE ACCOUNTS
1.1 The Accounts have been prepared in accordance with the requirements of all
relevant statutes and with good and generally accepted accountancy
principles and practice consistently applied, are complete and accurate in
all respects, show a true and fair view of the state of affairs of the
Company and of its results and profits for the financial period ending on
the Accounting Date, and disclose and make full provision or reserve for
all liabilities (whether actual or contingent and whether quantified or
disputed or otherwise).
1.2 All of the Company's book debts, whether shown in the Accounts or arising
since the Accounting Date, are valid and enforceable, and have realised or
will in aggregate realise the nominal amount thereof and, to the best of
the Vendors' knowledge, will be collectible in full within 90 days of the
Completion Date.
2. MANAGEMENT ACCOUNTS
The Management Accounts have been prepared in accordance with the accounting
policies of the Company which are the same as those contained in the Accounts of
the Company save as set out in the Disclosure Letter and on a consistent basis
with the monthly management accounts of the Company and show a fair view of the
assets and liabilities and profits and losses of the Company as at and to 31
October 2002.
3. TAX, RECORDS AND RETURNS
3.1 No event, act, transaction or omission has occurred or shall occur between
the Accounting Date and Completion which could give rise to a claim under
the terms of Clause (d)(iii)(4) in this Schedule 7.
3.2 The Company has duly filed all returns, computations, notices and
information required to be made or provided by the Company for any Tax
purpose and the same have been made or given within the requisite periods
and on a proper basis and when made were true and accurate in all material
respects and are up to date and none of them is or so far as the Vendors
are aware, likely to be the subject of any dispute with any Tax authority.
3.3 The Company has paid, and has withheld, deducted and accounted to the
relevant Tax authorities for, all Tax which it has become liable to pay,
withhold, deduct or account for on or before the date hereof and, within
the period of three years prior to the date hereof, neither the Company
nor any director or officer of the Company has paid or become liable to
pay any fine, penalty, surcharge or interest in relation to Tax for which
the Company is liable.
43
3.4 Save as provided for in the Accounts there is no existing contingent or
deferred liability for Tax including liability for Tax which might arise
as a result of the execution of this Agreement or Completion.
3.5 There are no unutilised Tax allowances, unrelieved Tax losses or excess
foreign tax credit available to the Company or outstanding entitlements to
make any claim, election, appeal or application in relation to Tax.
3.6 The Company has not entered into or been engaged in or been a party to any
transaction or series of transactions or scheme or arrangement of which
the main purpose or one of the main purposes was the avoidance or deferral
of Tax or a reduction in the liability to Tax of the Company.
3.7 All of the Company's income is exempt from Tax or is taxable at a
concessionary or reduced rate of Tax in accordance with the Philippine
Economic Zone Authority regulations.
3.8 The Company is not and has not at any time in the period of six years
ending with the date of this Agreement been liable to Tax in any
jurisdiction other than the Philippines or, in the case of a Investee
Company, the jurisdiction in which it is incorporated.
4. CORPORATE MATTERS
4.1 The Company has been duly incorporated and is validly existing and no
order has been made or petition presented or resolution passed for the
winding up of the Company or for an administration order in respect of the
Company and no distress, execution or other process has been levied on any
of its assets. The Company is not insolvent or unable to pay its debts and
no receiver or receiver and manager or similar officer has been appointed
by any person over its business or assets or any part thereof and no power
to make any such appointment has arisen.
4.2 All the issued shares in the capital of the Company are fully paid up and
legally and beneficially owned by the BVI Companies. The BVI Companies are
the legal and beneficial owners of all the issued shares in the capital of
the Company free and clear of all and any lien, charge, option, right of
pre-emption or other encumbrance or third party right whatsoever.
4.3 The Company has no, and never has had any, subsidiary or any shares or
participating interest in any company other than the Investee Companies.
The information on the Investee Companies set out in Schedule 4 is true
and accurate .
4.4 The Company has never reduced, repaid, redeemed or purchased any of its
share capital or agreed to do any of the same.
4.5 There are no options or other agreements outstanding which call for the
issue of or accord to any person the right to call for the issue of any
shares in the capital of the Company or loan capital or other securities
of the Company or the right to require the creation of any mortgage,
charge, pledge, lien or other security or encumbrance over any of the
shares of the Company or any of the assets of the Company (including
44
without limitation, rights of any third party arising out of the proposal
of the Company adopted on 10 October 2000 by the Directors and the Vendors
relating to a private placement of shares in the Company up to a value of
US$9,000,000).
4.6 The copies of the Articles of Incorporation and By-laws of the Company
which are attached to the Disclosure Letter are current and complete in
all respects. The Company has complied with its Articles of Incorporation
and By-laws in all respects and none of the activities, agreements,
commitments or rights of the Company is ultra xxxxx or unauthorised.
4.6 The stock and transfer book and all other statutory books of the Company
are up to date and contain true, full and accurate records of all matters
required to be dealt with therein, and all legal requirements relating to
the issue of shares and other securities by the Company have been complied
with.
4.7 The execution and delivery of, and the performance by the Vendors and the
Company of their obligations under this Agreement shall not:
(i) result in a breach of, or constitute a default under, any
instrument, contract, document or agreement, to which any Vendor or
the Company (as the case may be) is a party or by which the any
Vendor or the Company is bound; and/or
(ii) result in a breach of any law, rules, regulations, ordinances,
order, judgment or decree of or undertaking to any court, Government
Authority, statutory authority or regulatory body (including,
without limitation, any relevant stock exchange or securities
council) to which any Vendor or the Company (as the case may be) is
a party or by which any Vendor or the Company is bound.
4.8 This Agreement has been duly executed and delivered by the Vendors and
constitutes a legal, valid and binding obligation of the Vendors
enforceable against the Vendors in accordance with its terms.
4.9 The Vendors are not and will not be required to obtain any consent or
Governmental Approval in connection with the execution and delivery of
this Agreement or the consummation or performance of any its obligations
contemplated under this Agreement.
5. TRADING AND GENERAL COMMERCIAL MATTERS
5.1 The Company has good and marketable title to (with full power to sell) all
such assets as are necessary to enable it properly to conduct its business
as such business has been conducted prior to the date hereof and to all
inventory used in its business. All such assets and inventory are free
from any liens, mortgages, charges, encumbrances, hire or hire purchase or
similar agreements or other third party rights and are in the possession
or under the control of the Company. The inventory is in good condition
and of satisfactory quality, meets all relevant statutory, regulatory and
industry accepted standards and is capable of being sold by the Company in
the ordinary course of business in accordance with its list prices without
rebate or allowances and all other assets owned or used by the Company are
in good repair and fit for use for
45
the purposes for which designed, acquired or used by the Company. Finished
goods produced by the Company meet all applicable contractual
specifications at the time of production.
5.2 The Company is not a party to:
(a) any unusual or onerous contract, any contract not entered into in
the ordinary course of business or not on arm's length terms, nor
any contract which cannot be terminated without penalty or other
compensation on less than 12 months' notice. For the purposes of
this sub-clause, the term "unusual" and "onerous" will be determined
by reference to industry practice;
(b) any contract containing exclusivity obligations, non-competition
provisions or similar terms;
(c) any contract for the purchase or use by the Company of materials,
supplies or equipment which is in excess of the requirements of the
Company for its normal operating purposes or requires expenditure in
excess of US$100,000 or its equivalent in local currency;
(d) any agency, distribution, marketing, purchasing, franchising,
licensing (whether by or to the Company), joint venture, agency,
shareholders' or partnership arrangement or agreement or similar
arrangement or agreement; and
(e) any contract for the supply of goods or services requiring payments
in excess of US$100,000 or its equivalent in local currency that has
not been entered into on the Company's standard terms and conditions
of sale, a copy of which is attached to the Disclosure Letter.
5.3 To the best of the Vendor's knowledge, there are no contracts or
obligations, agreements, arrangements or concerted practices involving the
Company and no practices in which the Company is engaged which are void,
illegal, unenforceable, registrable or notifiable under or which
contravene any anti-trust legislation or regulations anywhere in the
world, nor has the Company received any threat or complaint or request for
information or investigation in relation to or in connection with any such
legislation or regulations.
5.4 With respect to each contract, commitment, arrangement, understanding,
tender and bid involving the Company:
(a) the Company has duly performed and complied in all material respects
with each of its obligations thereunder;
(b) the Company is under no obligation which cannot readily be
fulfilled, performed or discharged by it on time and without undue
or unusual expenditure or effort or loss;
46
(c) to the best of the Vendors' knowledge, there are no grounds for
rescission, avoidance, repudiation or termination and the Company
has not received any notice of termination; and
(d) none of the other parties thereto is in default thereunder.
5.5 No person has given any guarantee of or indemnity or security for any
liability of the Company, nor has the Company given any guarantee of or
indemnity or security for the liability of any other person.
5.6 The execution, delivery and performance of this Agreement is not liable to
result in the breach, cancellation or termination of any of the terms or
conditions of or constitute a default under any agreement, commitment or
other instrument affecting the Company or its property or assets or in the
acceleration of any obligation or termination of any commitment or
facility under any loan or financial agreement or the loss of the benefit
of or liability to refund or repay any grant or financial or fiscal
concession or violate any law or any rule or regulation of any
administrative agency or Government Authority or any order, writ,
injunction or decree of any court, administrative agency or Government
Authority affecting the Company.
5.7 The Vendors are not aware of any circumstances whereby, following a change
in the control of the Company or in the composition of the board of
directors of the Company, any of the principal customers of or suppliers
to the Company would have the right to, or would, cease to remain
customers or suppliers to the same extent and of the same nature as prior
to the date hereof.
5.8 The Company has no liabilities except liabilities arising in the ordinary
course of business under contracts for service, purchase orders, supply
contracts or sale contracts, nor does it have any other liabilities direct
or indirect, absolute or contingent, not required by generally accepted
accounting principles to be referred to in the Accounts, including, but
not limited to, off-balance sheet financing arrangements.
5.9 The Company is not the subject of any official investigation or inquiry
and none of the Vendor is aware of any facts which are likely to give rise
to any such investigation or inquiry.
5.10 The Company has complied with the requirements or conditions of all
statutes, treaties, regulations, by-laws, codes, orders and other
obligations of whatsoever nature relating to the Company and the carrying
on of its business and has obtained and complied with all registrations,
licences and consents necessary or advisable for the carrying on of its
business, and all such registrations, licences and consents are valid and
subsisting and none of the Vendors knows of any reason why any of them
should be suspended, cancelled or revoked (whether as a result of the sale
and purchase of the Sale Shares pursuant to this Agreement or otherwise).
Neither the Company, nor any of its directors, employees or agents in
relation to their functions in or on behalf of the Company, has committed
any criminal offence or any tort or any breach of any such statute,
treaty, regulation, by-law, code, order or other obligation.
47
5.11 The Disclosure Letter sets out full and accurate details of each bank and
similar account of the Company.
5.12 No act or transaction has been effected by or on behalf of the Company
involving the making or authorising of any payment, or the giving of
anything of value, to any government official, political party, party
official or candidate for political office for the purpose of influencing
the recipient in his or its official capacity in order to obtain business,
retain business or direct business to the Company or any other person or
firm.
5.13 All goods consigned to the Company by its customers are in good condition,
and no liability in respect of such goods has arisen on the part of the
Company.
6. THE PROPERTIES
6.1 The Properties comprise all the land and premises occupied or otherwise
used by the Company. The Company does not own any Property.
6.2 The Company is the lessee of the Properties under an enforceable and
binding contract, copies of which (and any amendments) have been provided
to the Purchaser. The Company is the legal and beneficial owner of
leasehold interest in the Properties free and clear of all encumbrances.
6.3 The Company has exclusive and unrestricted possession of the Properties.
6.4 Save for any applicable statutory restrictions, there are no covenants,
restrictions, burdens, stipulations, rights of way, easements, conditions,
outgoings, terms, overriding interests, rights or licences affecting any
of the Properties which are of an unusual or onerous nature or which
adversely affect the use of the Properties for which they are currently
used.
6.5 The present use of the Properties is the permitted use under applicable
zoning legislation. There are no onerous or unusual conditions adversely
affecting the Company's use and enjoyment of the Properties when compared
to properties of a similar type or location. The Properties comply with
all statutes, regulations, by-laws and other relevant legislation.
6.6 There are no outstanding disputes, notices or complaints which affect or
might in the future affect the use of any of the Properties for the
purposes for which they are now used.
6.7 No structural or other material defects have appeared in respect of or
affecting the buildings and structures on or comprising any of the
Properties or any parts thereof and all such buildings and structures are
in good and substantial repair and condition.
6.8 The Company has not at any time assigned or otherwise disposed of any
property, leasehold or otherwise, in respect of which it has a continuing
liability (contingent or otherwise) for payment of rent and/or for any
other liability.
48
7. ENVIRONMENTAL ISSUES
The Company has complied with and is in compliance with all applicable
Environmental Laws and has all Environmental Licences required for the carrying
on of its business. To the best of the Vendors' knowledge there are no
circumstances or grounds on which any of its Environmental Licences may be
withdrawn, suspended or varied.
8. CONFIDENTIAL INFORMATION AND INTELLECTUAL PROPERTY
8.1 (a) The Company does not use any processes and is not engaged in any
activities which involve the misuse of any Third Party Confidential
Information.
(b) Save for Third Party Confidential Information made available to the
Company in the ordinary course of business, all agreements and/or
arrangements under which Third Party Confidential Information is
made available to the Company are set out in the Disclosure Letter.
The Company is not in breach of any agreement or arrangement under
which Third Party Confidential Information is made available to it
and the Vendors are not aware of the existence of any circumstances
under which the Company's right to use such Third Party Confidential
Information may be terminated.
(c) The Vendors are not aware of any actual or alleged misuse by any
person of any of the Company's Confidential Information. The Company
has not disclosed to any person any of its Confidential Information
except where such disclosure was properly made in the normal course
of the Company's business and was made subject to an agreement under
which the recipient is obliged to maintain the confidentiality of
such Confidential Information and is restrained from further
disclosing it or using it other than for the purposes for which it
was disclosed by the Company.
8.2 The Company is the sole unencumbered legal and beneficial owner and, where
registered, the sole registered proprietor, of all the Intellectual
Property used in its business, including, but not limited to, the
Intellectual Property listed in the Disclosure Letter.
8.3 None of such Intellectual Property, nor the validity or subsistence of the
Company's interest therein, is or has during the last six years been the
subject of any current, pending or threatened challenge, claim or
proceedings, or been infringed or misused by any third party and there are
no facts or matters which might give rise to any of the same.
8.4 The carrying on of the Company's business does not require any
authorisations, permissions, licences or consents from, or the making of
royalty or similar payments to, any third party and the Company is not
engaged in any activities which involve the use of or which infringe any
Intellectual Property belonging to any third party.
49
9. INSURANCE
Copies of the Company's current insurance policies are attached to the
Disclosure Letter. Nothing has been done or omitted to be done by or on behalf
of the Company which would make any such policy of insurance void or voidable or
enable the insurers to avoid the same. There is no claim outstanding under any
such policy and the Vendors are not aware of any circumstances likely to give
rise to such a claim or result in an increased rate of premium.
10. LITIGATION
Neither the Company, nor any person for whose acts or defaults the Company may
be vicariously liable, are engaged whether as plaintiff or defendant or
otherwise in any civil, criminal or arbitration proceedings or any proceedings
before any tribunal (save for debt collection by the Company in the ordinary
course of business) and there are no proceedings threatened or pending against
the Company or any such person and there are no facts which are likely to give
rise to any such litigation or proceedings.
11. EMPLOYMENT AND PENSION MATTERS
11.1 There is no existing or threatened or pending industrial or trade dispute
involving the Company and any of its employees and there are no agreements
or arrangements (whether oral or in writing or existing by reason of
custom and practice and whether or not legally binding) between the
Company and any trade union or other employees' representatives or
organisation concerning or affecting the Company's employees.
11.2 The Company has neither given notice of any redundancies nor started
consultations with any independent trade union or employees'
representatives within the preceding period of one year in relation to any
of the Company's employees. No circumstances have arisen under which the
Company is likely to be required to pay damages for wrongful dismissal or
breach of contract, to make any contractual or statutory redundancy
payment or make or pay any compensation in respect of unfair dismissal, to
make any other payment under any employment protection or other employment
statutes, treaties, regulations, by-laws, codes or orders or to reinstate
or re-engage any former employee.
11.3 Save as disclosed in the Disclosure Letter, there are no pension, share
option, share incentive, life assurance, disability or similar schemes,
arrangements or obligations for any employees or directors of the Company,
and the Company has no obligation (whether legally binding or established
by custom) to pay any pension or make any other payment after retirement
or death to or in respect of any person who is now or has been an officer
or employee of the Company and are not party to any scheme or arrangement
having as its purpose or one of its purposes the making of such payments.
12. ARRANGEMENTS WITH CONNECTED PERSONS ETC.
The Company has not made any gift or loan to, or provided any guarantee or
security for a loan made by any other person to, any Vendor or director or
former director or any of their respective associated persons nor has it been a
party to any transaction or arrangement with
50
any of the foregoing other than arm's length service contracts, and the
Company's profits or financial position have not at any time been adversely
affected by any contract or arrangement which is not of an entirely arm's-length
nature.
13. MATTERS SINCE THE ACCOUNTING DATE
13.1 Since the Accounting Date, there has been no interruption or alteration in
the nature, scope or manner of the Company's business which business has
been carried on lawfully and in the ordinary and usual course of business
as previously carried on and so as to maintain it as a going concern;
13.2 Since the Accounting Date, there has been no material adverse change in
the financial condition or the position, prospects, assets or liabilities
of such business or the Company as compared with the position disclosed by
the Accounts;
13.3 Since the Accounting Date, the Company has continued to pay its creditors
in the ordinary course of business and no unusual trade discounts or other
special terms have been incorporated into any contract entered into by the
Company;
13.4 The Company's six month rolling forecasts for purchases by its customers
as at 30 September 2002 are attached to the Disclosure Letter together
with the rolling forecasts as at 31 October 2002. Save as is apparent on
the face of these forecasts, no substantial customer or supplier of the
Company for the accounting period ending on 30 September 2002 has ceased
or indicated that it is likely to cease trading with or supply to the
Company, or reduced or indicated that it is likely to reduce substantially
its trading with or supplies to the Company, or changed or indicated that
it is likely to change substantially the terms upon which it is prepared
to trade with or supply the Company (other than normal price and minor
changes);
13.5 Since the Accounting Date, no indebtedness of the Company has become
payable or capable of being declared payable prematurely.
13.6 Since the Accounting Date, no indebtedness has been repaid other than
indebtedness to its bankers or indebtedness repayable in the ordinary
course of business;
13.7 Since the Accounting Date, the Company has not cancelled, waived, released
or discontinued any rights, debts or claims or suffered any damage,
destruction or loss (whether or not covered by insurance) affecting its
business or assets;
13.8 Since the Accounting Date, the Company has not incurred any capital
expenditure or made any capital commitment of an amount in excess of
US$100,000 (or its equivalent in local currency) or disposed of any fixed
assets having a value of more than US$100,000 (or its equivalent in local
currency) in aggregate;
13.8 Since the Accounting Date, no dividends, bonuses or other distributions
have been declared, paid or made in respect of any of the Company's
shares.
51
14. ACCURACY OF INFORMATION PROVIDED
14.1 All information contained in the Recitals to this Agreement and in
Schedules 1 to 6 inclusive and Schedule 9 to this Agreement is true and
accurate in all respects and not misleading in any respect.
14.2 All written information given to the Purchaser and its professional
advisers by the Vendors, the officers and employees of the Company, the
Vendors' professional advisers and the Company's advisers during the
negotiations prior to this Agreement was when given true and accurate to
the best of their knowledge.
14.3 All information contained in the Disclosure Letter is true and accurate in
all respects and fairly presented and there is no fact or matter which has
not been disclosed in the Disclosure Letter which renders any such
information untrue or misleading and there is no fact or matter concerning
the Company and its business and affairs which has not on the basis of the
utmost good faith been disclosed in the Disclosure Letter which would
reasonably be expected to influence the decision of the Purchaser to
proceed with the purchase of the Sale Shares on the terms of this
Agreement.
PART TWO
WARRANTIES REGARDING THE BVI COMPANIES
15. CORPORATE MATTERS
15.1 The BVI Companies have been duly incorporated and are validly existing and
no order has been made or petition presented or resolution passed for the
winding up of any of the BVI Companies or for an administration order in
respect of any of the BVI Companies and no distress, execution or other
process has been levied on any of the assets of the BVI Companies. None of
the BVI Companies are insolvent or unable to pay their debts and no
receiver or receiver and manager or similar officer has been appointed by
any person over the business or assets of any BVI Company or any part
thereof and no power to make any such appointment has arisen.
15.2 All the issued shares in the capital of the BVI Companies are fully paid
up and legally and beneficially owned by the Vendors. The Sale Shares
constitute all the issued shares in the capital of the BVI Companies and
are fully paid up. The Vendors are the legal and beneficial owners of the
Sale Shares set opposite their names in column 2 of Schedule 1, free and
clear of all and any lien, charge, option, right of pre-emption or other
encumbrance or third party right whatsoever. Upon Completion, each of the
BVI Companies shall become a wholly owned subsidiary of the Purchaser.
15.3 The BVI Companies have no, and never have had any, subsidiary or any
shares or participating interest in any company other than the Company.
The information on the Company set out in Schedule 4 is true and accurate.
52
15.4 None of the BVI Companies have ever reduced, repaid, redeemed or purchased
any of its share capital or agreed to do any of the same.
15.5 There are no options or other agreements outstanding which call for the
issue of or accord to any person the right to call for the issue of any
shares in the capital of any of the BVI Companies or loan capital or other
securities of any of the BVI Companies or the right to require the
creation of any mortgage, charge, pledge, lien or other security or
encumbrance over any of the shares of any of the BVI Companies or any of
the assets of any BVI Company.
15.6 The copies of the Articles of Incorporation and By-laws (or equivalent
constitutive documents) of the BVI Companies which are attached to the
Disclosure Letter are accurate and complete in all respects. Each of the
BVI Companies has complied with its Articles of Incorporation and By-laws
(or equivalent constitutive documents) in all respects and none of the
activities, agreements, commitments or rights of such BVI Company is ultra
xxxxx or unauthorised.
15.7 The stock and transfer book and all other statutory books of the BVI
Companies are up to date and contain true, full and accurate records of
all matters required to be dealt with therein, and all legal requirements
relating to the issue of shares and other securities by the BVI Companies
have been complied with.
15.8 The execution and delivery of, and the performance by the BVI Companies of
their obligations under this Agreement shall not:
(i) result in a breach of, or constitute a default under, any
instrument, contract, document or agreement, to which any BVI
Company is a party or by which the any BVI Company is bound; and/or
(iii) result in a breach of any law, rules, regulations, ordinances,
order, judgment or decree of or undertaking to any court, Government
Authority, statutory authority or regulatory body (including,
without limitation, any relevant stock exchange or securities
council) to which any BVI Company is a party or by which any BVI
Company is bound.
15.9 This Agreement has been duly executed and delivered by the BVI Companies
and constitutes a legal, valid and binding obligation of the BVI Companies
enforceable against the BVI Companies in accordance with its terms.
15.10 The BVI Companies are not and will not be required to obtain any consent
or Governmental Approval in connection with the execution and delivery of
this Agreement or the consummation or performance of any their obligations
contemplated under this Agreement.
15.11 The BVI Companies are not the subject of any official investigation or
inquiry.
15.12 The BVI Companies have complied with the requirements or conditions of all
statutes, treaties, regulations, by-laws, codes, orders and other
obligations of whatsoever nature relating to the BVI Companies and the
carrying on of their
53
businesses and have obtained and complied with all registrations, licences
and consents necessary or advisable for the carrying on of their
businesses, and all such registrations, licences and consents are valid
and subsisting. Neither the BVI Companies, nor any of their directors,
employees or agents in relation to the BVI Companies, have committed any
criminal offence or any tort or any breach of any such statute, treaty,
regulation, by-law, code, order or other obligation.
15.13 Each of the BVI Companies has been established for the sole purpose of
owning shares or issued capital stock in the Company and for no other
reason whatsoever, and is not, and never has been, involved in any other
business or trading activities or operations apart from ownership of
shares or issued capital stock of the Company and does not have any
employees. Apart from the Sale Shares, the BVI Companies do not have any
other assets, or liabilities (whether actual or contingent and whether
quantified or disputed or otherwise) and have not entered into any
contracts or arrangements with any party.
16. TAX RECORDS AND RETURNS
16.1 No event, act, transaction or omission has occurred or shall occur between
the Accounting Date and Completion which could give rise to a claim under
the terms of Clause (d)(iii)(4) in this Schedule 7.
16.2 The BVI Companies have duly filed all returns, computations, notices and
information required to be made or provided by the BVI Companies for any
Tax purpose and the same have been made or given within the requisite
periods and on a proper basis and when made were true and accurate in all
material respects and are up to date and none of them is or so far as the
Vendors are aware, likely to be the subject of any dispute with any Tax
authority.
16.3 The BVI Companies have paid, and have withheld, deducted and accounted to
the relevant Tax authorities for, all Tax which they have become liable to
pay, withhold, deduct or account for on or before the date hereof and,
within the period of six years prior to the date hereof, neither the BVI
Companies nor any director or officer of the BVI Companies has paid or
become liable to pay any fine, penalty, surcharge or interest in relation
to Tax for which the BVI Companies are liable.
16.4 Save as provided for in the Accounts there is no existing contingent or
deferred liability for Tax including liability for Tax which might arise
as a result of the execution of this Agreement or Completion.
16.5 There are no unutilised Tax allowances, unrelieved Tax losses or excess
foreign tax credit available to the BVI Companies or outstanding
entitlements to make any claim, election, appeal or application in
relation to Tax.
16.6 The BVI Companies have not entered into or been engaged in or been a party
to any transaction or series of transactions or scheme or arrangement of
which the main
54
purpose or one of the main purposes was the avoidance or deferral of Tax
or a reduction in the liability to Tax of the BVI Companies.
16.7 All of the BVI Companies' income is exempt from Tax.
16.8 The BVI Companies are not and have not at any time in the period of six
years ending with the date of this Agreement been liable to Tax in any
jurisdiction other than the British Virgin Islands.
17. LITIGATION
None of the BVI Companies, nor any person for whose acts or defaults such BVI
Company may be vicariously liable, are engaged whether as plaintiff or defendant
or otherwise in any civil, criminal or arbitration proceedings or any
proceedings before any tribunal and there are no proceedings threatened or
pending against any of the BVI Companies or any such person and there are no
facts which are likely to give rise to any such litigation or proceedings.
PART THREE
WARRANTIES REGARDING THE VENDORS
18.1 This Agreement has been duly executed and delivered by the Vendors and
constitutes a legal, valid and binding obligation of the Vendors
enforceable against the Vendors in accordance with its terms.
18.2 The Vendors are not and will not be required to obtain any consent or
Governmental Approval in connection with the execution and delivery of
this Agreement or the consummation or performance of any of their
obligations contemplated under this Agreement.
55
SCHEDULE 8
WARRANTIES OF THE PURCHASER
(a) The Purchaser represents and warrants to each of the Vendors that, except
as set forth in the Purchaser's Disclosure Letter, each of the statements
set out in Clauses (a)(i) to (a)(viii) inclusive below of this Schedule 8
(the "PURCHASER'S WARRANTIES") will at Completion be true and accurate:
(i) On Completion, the Consideration Shares are and shall have been
authorised, validly issued, allotted and fully paid-up and are free
from all and any Encumbrances together with all rights and benefits
attaching thereto as at the Completion Date and no other person has
or shall have any rights of pre-emption over such Consideration
Shares.
(ii) On Completion, each of the Vendors shall be the legal and beneficial
owners of the relevant Consideration Shares allotted to each of
them.
(iii) The execution and delivery of, and the performance by the Purchaser
of its obligations under this Agreement (including the allotment of
the Consideration Shares to the Vendors) shall not:
(1) result in a breach of, or constitute a default under, any
instrument, contract, document or agreement, to which the
Purchaser is a party or by which the Purchaser is bound;
and/or
(2) result in a breach of any law, rules, regulations, ordinances,
order, judgment or decree of or undertaking to any court,
Government Authority, statutory authority or regulatory body
(including, without limitation, any relevant stock exchange or
securities council) to which the Purchaser is a party or by
which the Purchaser is bound.
(iv) The Purchaser is a corporation duly organized, validly existing and
in good standing under the laws of its jurisdiction of organization
with full corporate power and authority to conduct its business as
presently conducted, to own or use the properties and assets that it
purports to own or use, and to perform all its obligations.
(v) This Agreement has been duly executed and delivered by the Purchaser
and constitutes a legal, valid and binding obligation of the
Purchaser enforceable against the Purchaser in accordance with its
terms.
(vi) The Purchaser is not and will not be required to obtain any consent
or Governmental Approval in connection with the execution and
delivery of this Agreement or the consummation or performance of any
its obligations contemplated under this Agreement (save for any
approval or exemption required to be obtained in relation to the
grant of the Option Shares).
56
(vii) There is no pending Proceeding that has been commenced against the
Purchaser and that challenges, or may have the effect of preventing,
delaying, or making illegal or otherwise interfering with, the
performance by the Purchaser of any of its obligations under this
Agreement and no such Proceeding has been threatened.
(viii)The unaudited management accounts of the Purchaser for the period
ended 31 October 2002 have been prepared in accordance with the
accounting policies of the Purchaser save as set out in the
Disclosure Letter and show a fair view of the assets and liabilities
(whether actual or contingent and whether quantified or disputed or
otherwise) and profits and losses of the Purchaser as at and to 31
October 2002.
The Purchaser's Warranties are given subject to matters fully, fairly and
specifically disclosed in the Purchaser's Disclosure Letter but no other
information relating to the Purchaser of which the Vendors have knowledge
(actual or constructive) and no investigation by or on behalf of the
Vendors shall prejudice any claim made by the Vendors under the
Purchaser's Warranties or operate to reduce any amount recoverable, and
liability in respect thereof shall not be confined to breaches discovered
before Completion. No letter, document or other communication shall be
deemed to constitute a disclosure for the purposes of this Agreement
unless the same is accepted as such by the Vendors and is expressly
referred to in the Purchaser's Disclosure Letter.
(b) The Purchaser undertakes to and agrees with each Vendor that it shall, and
shall procure that its subsidiaries shall, in relation to Viko Technology,
Inc., enforce or procure to be enforced to their full extent the
obligations of the Target Warrantors (as defined in the Investment
Agreement) to the Purchaser under the terms of the Target Warranties (as
defined in the Investment Agreement) and Indemnities (as defined in the
Investment Agreement). For the avoidance of doubt, and for identification
purposes only, the Target Warranties (as defined in the Investment
Agreement) are reproduced in Part One of this Schedule 8 below.
(c) The liabilities of the Purchaser under the Purchaser's Warranties shall
cease after one year from the Completion Date except in respect of matters
which have been the subject of a bona fide written claim made before such
date by the Vendors or the Vendors' Lawyers to the Purchaser or the
Purchaser's Lawyers save in relation to:
(i) Clauses (a)(i) and (a)(ii) of this Schedule 8; and
(ii) a claim or claims in relation to the Purchaser's Warranties arising
by reason of fraud, wilful concealment, dishonesty or deliberate
non-disclosure on the part of the Purchaser or on the part of any
officer or representative of the Purchaser prior to the Completion
Date, in which event there shall be no limit on the amount
recoverable by the Vendors from the Purchaser in respect of such
claim or claims and the time period within which such a claim or
claims may be brought shall be extended to ten years from the
Completion Date.
57
(d) Without limiting the above, the liabilities of the Purchaser under
Purchaser's Warranties shall be limited to a maximum aggregate amount of
US$5,000,000. After Completion Date and up to and including the first
anniversary of Completion Date, the Purchaser's liability in relation to
the Purchaser's Warranties (in respect of which a bona fide written claim
has been made before the first anniversary of the Completion Date by the
Vendors or the Vendors' Lawyers to the Purchaser or the Purchaser's
Lawyers) shall be limited to a maximum aggregate amount of US$5,000,000.
From the first anniversary of the Completion Date onwards, the Purchaser's
liability in relation to the Purchaser's Warranties shall be limited to a
maximum aggregate amount of US$2,000,000. In addition, the Purchaser shall
not incur any liability until the aggregate amount of all liabilities,
exceeds US$100,000 (the "PURCHASER'S BASKET"), at which point, the
Purchaser shall be liable for the complete amount of all liabilities,
including, without limitation US$100,000 of the Purchaser's Basket.
(e) Without restricting the rights of the Vendors or otherwise affecting the
ability of the Vendors to claim damages on any other basis available to it
(save for a claim or claims in relation to the Purchaser's Warranties
arising by reason of fraud, wilful concealment, dishonesty or deliberate
non-disclosure on the part of the Purchaser or on the part of any officer
or representative of the Purchaser prior to the Completion Date, in which
event there shall be no limit on the amount recoverable by the Vendors
from the Purchaser in respect of such claim or claims and the time period
within which such a claim or claims may be brought shall be extended to
ten years from the Completion Date), the Purchaser hereby undertakes, for
so long as the Purchaser's liability under the Purchaser's Warranties
survives pursuant to Clause (c) above of this Schedule 8, to indemnify and
keep indemnified the Vendors and their officers, directors, employees,
agents and shareholders (collectively, the "INDEMNIFIED VENDORS") against:
(i) any loss or liability suffered by any of the Indemnified Vendors as
a result of, arising from or in connection with any breach of any of
the Purchaser's Warranties including, but not limited to, any
dimunition in the value of the Consideration Shares and any payment
made or required to be made by the Indemnified Vendors and any
costs, expenses, fines, penalties and Taxes incurred as a result of
such breach. For the purposes of this Clause (e)(i), any dimunition
in value of the Consideration Shares will be determined by reference
to the fair market value of the Consideration Shares. The fair
market value will be determined by an independent third party valuer
to be appointed by agreement by the Vendors and the Purchaser. In
the event that there is any disagreement on the valuer, either the
Vendors or the Purchaser may request the President of the Institute
of Certified Public Accountants of Singapore to decide on the
valuer. The Vendors and the Purchaser shall engage the valuer on his
standard terms and conditions;
(ii) all costs and expenses properly and reasonably incurred by any of
the Indemnified Vendors in connection with or as a result of such
breach and any costs (including legal costs on a solicitor and own
client basis), expenses or other liabilities which any of them may
incur either before or after the commencement or any action in
connection with (1) any legal proceedings in
58
which any of the Indemnified Vendors claims that any of the
Purchaser's Warranties has been broken or is untrue and in which
judgement is given for any of the Indemnified Vendors; or (2) the
enforcement of any settlement of, or judgement in respect of, such
claim.
[THE REST OF THIS PAGE IS INTENTIONALLY LEFT BLANK]
59
PART ONE TO SCHEDULE 8
All defined terms used but not defined in this Part One to Schedule 8 shall have
the respective meaning ascribed to them in the Viko Share Purchase Agreement.
REPRESENTATIONS AND WARRANTIES OF SELLERS{TC}
Sellers jointly and severally represent and warrant to Buyer that, except as set
forth in Sellers' Disclosure Schedule:
3.1 ORGANIZATION AND GOOD STANDING{TC}
(a) Each Acquired Company is a corporation duly organized, validly
existing and in good standing under the laws of its jurisdiction of
organization, with full corporate power and authority to conduct its
business as presently conducted, to own or use the properties and assets
that it purports to own or use, and to perform all its obligations under
all its Company Contracts. Each Acquired Company is duly qualified to do
business as a foreign entity and is in good standing in each jurisdiction
in which either the ownership or use of the properties owned or used by
it, or the nature of the activities conducted by it, requires such
qualification.
(b) Sellers have delivered to Buyer copies of all the Governing Documents
and the complete and accurate stock records of each Acquired Company, as
currently in effect. Section 3.1(b) of Sellers' Disclosure Schedule
contains an accurate and complete listing of each Acquired Company's
jurisdiction of formation and other jurisdictions in which it is
authorized to do business.
3.2 ENFORCEABILITY; NO CONFLICT{TC}
(a) Each Seller has the absolute and unrestricted right, power, authority
and capacity to execute and deliver this Agreement and the Ancillary
Agreements to which such Seller is a party and to perform such Seller's
obligations under this Agreement and such Ancillary Agreements. Assuming
due authorization, execution and delivery of this Agreement by Buyer, this
Agreement constitutes the legal, valid and binding obligation of each
Seller, enforceable against each Seller in accordance with its terms.
Assuming due authorization, execution and delivery by the other parties
thereto, each Ancillary Agreement to which a Seller becomes a party will,
upon execution and delivery, constitute that Seller's legal, valid and
binding obligation, enforceable against him in accordance with its terms.
(b) Assuming Buyer's compliance with relevant Laws relating to the
purchase of the Shares, Sellers are not and will not be required to give
any notice to any Person or obtain any Consent or Governmental
Authorization in connection with the execution and delivery of this
Agreement or the consummation or performance of any of the Contemplated
Transactions. Not to limit the generality of the foregoing, no Acquired
Company, acting either independently or in conjunction with any of the
other Acquired Companies, engages in any military contracts or is
otherwise involved in
60
United States national security matters that may cause the Contemplated
Transactions to be disallowed under Exon-Xxxxxx.
(c) Neither the execution and delivery of this Agreement nor the
consummation or performance of any of the Contemplated Transactions will
directly or indirectly (with or without notice or lapse of time) (i)
Contravene any provision of the Governing Documents of an Acquired
Company, or any resolution adopted by the shareholders or board of
directors of an Acquired Company, (ii) Contravene any Company Contract,
Governmental Authorization, Law or Order to which any Acquired Company or
any Seller, or any of the assets owned or used by an Acquired Company, may
be subject, or (iii) result in the imposition or creation of any
Encumbrance upon or with respect to any of the assets owned or used by an
Acquired Company.
3.3 CAPITALIZATION AND OWNERSHIP{TC}
The authorized capital stock of the Company consists of 18,000,000 shares of
common stock, no par value per share, of which 17,320,200 shares are issued and
outstanding, which constitute all the Shares, and no shares of preferred stock.
The attached Schedule of Sellers correctly sets out the Shares owned by each
Seller. The Shares represent all of the issued and outstanding shares in the
Company. Sellers are and will be on the Closing Date the record holders and
beneficial owners of the Shares, free and clear of all Encumbrances. Section 3.3
of Sellers' Disclosure Schedule lists all the Option Holders. The Option Holders
shall not receive shares of stock in the Company and all options held by the
Option Holders shall be cancelled prior to the Closing. Except for the Option
Holders, no other Person has a Contract for the issuance, sale or transfer of
any Security of an Acquired Company. With the exception of the Shares (which are
owned by Sellers), all of the outstanding Securities of each Acquired Company
are owned of record and beneficially by one or more of the Acquired Companies,
free and clear of all Encumbrances. No legend or other reference to any
purported Encumbrance appears upon any certificate representing Securities of
any Acquired Company. All of the outstanding Securities of each Acquired Company
have been duly authorized and validly issued and are fully paid and
nonassessable. None of the outstanding Securities of any Acquired Company was
issued in violation of any Law. No Acquired Company owns, or has any Contract to
acquire, any Securities of any Person or any direct or indirect equity or
ownership interest in any other business.
3.4 FINANCIAL STATEMENTS{TC}
Sellers have delivered to Buyer (a) audited consolidated balance sheets of the
Acquired Companies as at April 30 for each of the years 1999 through 2000,
inclusive, and the related audited consolidated statements of income, changes in
shareholders' equity and cash flow for each of the fiscal years then ended,
together with the report thereon of Xxxxxxxx, Xxxx & Co., LLP independent
certified public accountants, (b) an audited consolidated balance sheet of the
Acquired Companies as of April 30, 2001 (including the notes thereto, the
"Balance Sheet"), and the related audited consolidated statements of income,
changes in shareholders' equity and cash flow for the fiscal year then ended,
together with the report thereon of Xxxxxxxx, Xxxx & Co., LLP independent
certified public accountants, and (c) an unaudited consolidated balance sheet of
the Acquired Companies as of October 31, 2001 (the "Interim Balance Sheet") and
the related unaudited consolidated statements of income, changes in
shareholders' equity and cash flow for the 3 months then ended, including in
each case the
61
notes thereto. Such financial statements and notes fairly present the financial
condition and the results of operations, changes in shareholders' equity and
cash flow of the Acquired Companies as at the respective dates of and for the
periods referred to in such financial statements, all in accordance with GAAP,
subject in the case of interim financial statements to normal recurring year-end
adjustments (the effect of which will not, individually or in the aggregate, be
materially adverse) and the absence of notes that, if presented, would not
differ materially from those included in the Balance Sheet. The financial
statements referred to in this Section reflect the consistent application of
accounting principles throughout the periods involved, except as otherwise
disclosed in the notes to such financial statements. No financial statements of
any Person other than the Acquired Companies are required by GAAP to be included
in the financial statements of the Company.
3.5 BOOKS AND RECORDS{TC}
The books of account, minute books, equity record books and other transactional
records of the Acquired Companies, all of which have been made available to
Buyer, are accurate and complete in all material respects and have been
maintained in accordance with sound business practices, including the
maintenance of an adequate system of internal controls. Each material
transaction of each Acquired Company is accurately recorded on the books and
records of the Acquired Company, and each document (including any Contract,
invoice or receipt) on which entries in the Acquired Company's books and records
are based is accurate and complete in all material respects. The minute books of
each Acquired Company contain accurate records of all meetings held of, and
corporate action taken by, the Acquired Company's shareholders, directors and
directors' committees, and no such meeting has been held for which minutes have
not been prepared and are not contained in such minute books. At the time of the
Closing, all of those books and records will be in the possession of the
respective Acquired Company.
3.6 ACCOUNTS RECEIVABLE{TC}
All Accounts Receivable that are reflected on the Balance Sheet, the Interim
Balance Sheet or the accounting records of each Acquired Company as of the
Closing Date represent or will represent valid obligations arising from sales
actually made or services actually performed in the Ordinary Course of Business.
Subject to reserves established according to GAAP, to Sellers' best Knowledge
each of the Accounts Receivable reflected on the Balance Sheet and Interim
Balance Sheet will be collected in full, without any setoff, within 120 days
after the day on which it first became or becomes due and payable. There is no
contest, claim, defense or right of setoff, other than returns in the Ordinary
Course of Business, under any Contract with any obligor of an Account Receivable
relating to the amount or validity of such Account Receivable. Section 3.6 of
Sellers' Disclosure Schedule contains an accurate and complete list of all
Accounts Receivable as of the date of the Interim Balance Sheet, which list sets
forth the aging of each such Account Receivable.
3.7 INVENTORIES{TC}
All items included in the Inventories are of a quality and quantity usable and,
with respect to finished goods, salable in the Ordinary Course of Business,
except for obsolete items and
62
items of below-standard quality, all of which have been or will be written off
or written down to net realizable value on the Balance Sheet, the Interim
Balance Sheet or the accounting records of the appropriate Acquired Company as
of the Closing Date, as the case may be. Other than in the Ordinary Course of
Business, no Acquired Company is in possession of any inventory, including goods
already sold, not owned by an Acquired Company. All of the Inventories not
written off have been valued at the Acquired Company's cost thereof on a first
in, first out basis. All of the Inventories now on hand that were purchased
after the date of the Interim Balance Sheet were purchased in the Ordinary
Course of Business at a cost not exceeding market prices prevailing at the time
of purchase. The quantities of each item of Inventory (whether raw materials,
work-in-process or finished goods) are not excessive, but are reasonable in the
present circumstances of the Acquired Companies. Work-in-process Inventories are
now valued and on the Closing Date will be valued according to GAAP applied on a
basis consistent with the basis on which the Balance Sheet was prepared. All
Inventories are maintained at one of the locations of Real Property listed in
Section 3.11(a) of Sellers' Disclosure Schedule.
3.8 NO UNDISCLOSED LIABILITIES{TC}
No Acquired Company has any Liabilities except for Liabilities reflected or
reserved against in the Balance Sheet or the Interim Balance Sheet, and current
Liabilities incurred in the Ordinary Course of Business since the respective
dates thereof.
3.9 NO MATERIAL ADVERSE CHANGE{TC}
Since the date of the Balance Sheet and excluding changes in the general
economic condition or changes generally affecting the industry in which the
Acquired Company operates(provided that such changes do not affect the Acquired
Company in a disproportionate manner), there has been no material adverse change
in the financial or other condition, results of operations, assets (considered
in the aggregate), Liabilities, equity or business of the Company or other
specific changes of concern to Buyer, and no event has occurred or condition has
arisen that (a) may result in such a change, (b) has materially impeded or may
materially impede the ongoing operations of the Company or (c) has significantly
adversely affected or may significantly adversely affect a material asset of the
Company.
3.10 ABSENCE OF CERTAIN CHANGES AND EVENTS{TC}
Since the date of the Balance Sheet, each Acquired Company has conducted its
business only in the Ordinary Course of Business and there has not been any:
(a) change in an Acquired Company's authorized or issued shares; grant of
any equity option or right to purchase shares of an Acquired Company;
issuance of any security convertible into such equity; grant of any
registration rights; purchase, redemption, retirement or other acquisition
by an Acquired Company of any shares; or declaration or payment of any
dividend or other distribution or payment with respect to any shares;
63
(b) amendment to the Governing Documents of an Acquired Company;
(c) payment (except in the Ordinary Course of Business) or increase by an
Acquired Company of any bonuses, salaries or other compensation to any
Seller, director or employee, or entry into any employment, severance or
similar Contract with any director or employee;
(d) adoption of, amendment to or increase in the payments to or benefits
under, any Plan or material Other Benefit Obligation of an Acquired
Company;
(e) damage to or destruction or loss of any asset or property of an
Acquired Company, whether or not covered by insurance, with an aggregate
value to the Company in excess of $25,000;
(f) entry into, modification, cancellation or termination of or receipt of
notice of termination of (i) any license, distributorship, dealer, sales
representative, joint venture, credit, guaranty or similar Company
Contract, or (ii) any Contract or transaction involving a total remaining
commitment by or to an Acquired Company of at least $25,000;
(g) sale, lease or other disposition of any asset or property of an
Acquired Company (other than in the Ordinary Course of Business),
including Intellectual Property, or the creation of any Encumbrance on any
material asset of an Acquired Company;
(h) cancellation or waiver of any claims or rights with a value to an
Acquired Company in excess of $25,000;
(i) material acceleration or delay in the payment of accounts payable or
in the collection of Accounts Receivable;
(j) material change in the accounting methods used by an Acquired Company;
or
(k) Contract by an Acquired Company to do any of the foregoing.
3.11 PROPERTIES; ENCUMBRANCES{TC}
(a) Section 3.11(a) of Sellers' Disclosure Schedule contains (i) a correct
legal description, street address and tax parcel identification number of
all Real Property in which an Acquired Company has a fee simple estate and
(ii) an accurate description (by subject leased Real Property, name of
lessor, date of lease and term expiration date) of all leases of Real
Property in which an Acquired Company has a leasehold estate.
(b) Each Acquired Company owns good and marketable title to its respective
estates in the Real Property, free and clear of any Encumbrances, other
than liens for Taxes for the current Tax year which are not yet due and
payable.
(c) Sellers have delivered to Buyer true and complete copies of (i) all
deeds and other instruments (as recorded) by which each Acquired Company
acquired its estates in the Real Property, (ii) all title insurance
policies and surveys in the possession of
64
Sellers or an Acquired Company of or pertaining to the Real Property, and
(iii) all Contracts and other documents evidencing, creating or
constituting Encumbrances upon the Real Property.
(d) Use of the Real Property for the various purposes for which it is
presently being used is permitted as of right under applicable zoning Laws
and is not subject to "permitted non-conforming" use or structure
classifications. To Sellers' best Knowledge, all Improvements are in
compliance with applicable Laws, including those pertaining to zoning,
building and the disabled. To Sellers' best Knowledge, no part of any
Improvement encroaches on any real property not included in the Real
Property, and there are no buildings, structures, fixtures or other
improvements primarily situated on adjoining property which encroach on
any part of the Real Property. The Real Property on which each Improvement
is located (i) abuts on and has direct vehicular access to a public road
or has access to a public road via a permanent, irrevocable, appurtenant
easement benefiting such parcel of Real Property and comprising a part of
the Real Property, (ii) is supplied with public or quasi-public utilities
and other services appropriate for the operation of the Improvement and
(iii) to Sellers' best Knowledge, is not located within any flood plain or
area subject to wetlands regulation or any similar restriction. To
Sellers' best Knowledge, there is no existing or proposed plan to modify
or realign any street or highway or any existing or proposed eminent
domain Proceeding that would result in the taking of all or any part of
any Real Property or that would prevent or hinder the continued use of any
Real Property as heretofore used in the conduct of the business of the
Acquired Companies. Except as otherwise provided for in Section 3.11(d) of
Sellers' Disclosure Schedule, no Person other than an Acquired Company is
in possession of any portion of the Real Property.
(e) Except as otherwise provided for in Section 3.11(e) of Sellers'
Disclosure Schedule, each Acquired Company owns good and transferable
title to all of its personal and tangible assets, as well as its other
assets, free and clear of any Encumbrances.
3.12 CONDITION AND SUFFICIENCY OF TANGIBLE ASSETS{TC}
To Sellers' best Knowledge, the Improvements are structurally sound, are in good
operating condition and repair, ordinary wear and tear excepted, are free from
latent and patent defects, and are adequate for the uses to which they are being
put. Each item of tangible personal property of each Acquired Company currently
used in its Ordinary Course of Business is, to Sellers' best Knowledge, in good
operating condition and repair, ordinary wear and tear excepted, is free from
latent and patent defects and is suitable for immediate use in the Ordinary
Course of Business. The Real Property and tangible personal property of the
Acquired Companies constitute all such assets necessary for the continued
operation of the Acquired Companies after the Closing in the same manner as
before the Closing and are in the possession of or under the control of the
Acquired Companies.
3.13 INTELLECTUAL PROPERTY{TC}
(a) Each Acquired Company owns or has the right to use pursuant to a valid
Contract all material items of Intellectual Property necessary for the
operation of the
65
Acquired Companies as presently conducted and as presently proposed to be
conducted. Not to limit the generality of the foregoing, each Acquired
Company has entered into a valid Contract with the employees, consultants
and contractors collectively listed on Section 3.13(a) of Sellers'
Disclosure Schedule assigning and transferring all Intellectual Property
necessary for the operation of the Acquired Companies as presently
conducted and as presently proposed to be conducted. Each material item of
Intellectual Property owned or used by an Acquired Company as of the date
of this Agreement will be owned or available for use by the Acquired
Company on substantially identical terms immediately subsequent to the
Closing without the requirement of obtaining any third party consents.
Each Acquired Company has taken all necessary and reasonable actions
within its control to maintain and protect each item of Intellectual
Property that it owns or uses.
(b) No Acquired Company has interfered with, infringed upon,
misappropriated or otherwise Contravened any intellectual property rights
of third parties, and no Acquired Company has received any notice or other
communication (whether oral or written) regarding any actual, alleged or
potential such interference, infringement, misappropriation or
Contravention. To Sellers' best Knowledge, no event has occurred or
circumstance exists that may (with or without notice or lapse of time)
constitute or result, nor will the continued operation of the Acquired
Companies after the Closing as presently conducted and as presently
proposed to be conducted constitute or result, directly or indirectly, in
any such interference, infringement, misappropriation or Contravention. To
Sellers' best Knowledge, no third party has interfered with, infringed
upon, misappropriated or otherwise Contravened any Intellectual Property
rights of any Acquired Company.
(c) Section 3.13(c) of Sellers' Disclosure Schedule identifies each issued
patent and each registered trademark, service xxxx and copyright owned by
an Acquired Company and identifies each pending application or application
for registration that has been made with respect to any Intellectual
Property owned by an Acquired Company. Sellers have delivered to Buyer
true and complete copies of all such patents, registrations and
applications, each as amended to date, and has made available to Buyer
true and complete copies of all other written documentation evidencing
ownership and prosecution of each such item. With respect to each item of
Intellectual Property required to be identified in Section 3.13(c) of
Sellers' Disclosure Schedule:
(i) an Acquired Company possesses all right, title and interest in
and to the item, free and clear of any Encumbrances;
(ii) the item is not subject to any outstanding Order;
(iii) no Proceeding is pending or, to Sellers' best Knowledge,
threatened, which challenges the legality, validity, enforceability, use
or ownership of the item, and no event has occurred or circumstance exists
that may give rise to such a challenge; and
(iv) no Acquired Company has agreed to indemnify any Person for or
against any interference, infringement, misappropriation or other
Contravention with respect to the item.
66
(d) With respect to each Company Contract required to be identified in
Section 3.14(a)(vi) of Sellers' Disclosure Schedule pursuant to which an
Acquired Company uses Intellectual Property owned by a third party:
(i) the underlying item of Intellectual Property is not subject to
any Order;
(ii) no Proceeding is pending or, to Sellers' best Knowledge,
threatened, which challenges the legality, validity, enforceability, use
or ownership of the underlying item of Intellectual Property, and to
Sellers' best Knowledge, no event has occurred or circumstance exists that
may give rise to such a challenge;
(iii) with respect to such Company Contracts under which an Acquired
Company is a sublicensee, the representations and warranties set forth in
Sections 3.2(c), 3.14(c) and 3.14(d) are, to Sellers' best Knowledge, true
and correct with respect to the underlying license; and
(iv) no Acquired Company has granted any sublicense or similar right
with respect to any such Company Contracts.
3.14 CONTRACTS; NO DEFAULTS{TC}
(a) Section 3.14(a) of Sellers' Disclosure Schedule contains an accurate
and complete list of:
(i) each Company Contract that involves performance of services or
delivery of goods or materials by one or more Acquired Companies of an
amount or value in excess of $25,000;
(ii) each Company Contract that involves performance of services or
delivery of goods or materials to one or more Acquired Companies of an
amount or value in excess of $25,000;
(iii) each distribution or sales Contract entered into by the
Company with third parties that cannot be terminated by the Company upon
giving 30 days notice and without liability on the part of the Company;
(iv) each Company Contract that was not entered into in the Ordinary
Course of Business and that involves the expenditure or receipt by one or
more Acquired Companies of an amount or value in excess of $25,000;
(v) each Company Contract that is a (A) mortgage, indenture, note,
installment obligation or other instrument relating to the borrowing of
money, (B) letter of credit, bond or other indemnity (including letters of
credit, bonds or other indemnities as to which an Acquired Company is the
beneficiary but excluding endorsements of instruments for collection in
the Ordinary Course of Business) or (C) currency or interest rate swap,
collar or hedge agreement;
(vi) each Company Contract affecting the ownership of, leasing of,
title to, use of, or any other interest in any real or personal property
(except personal property leases and installment and conditional sales
agreements having (A) a value per item or aggregate payments of less than
$25,000 and (B) a term of less than one year);
67
(vii) each Company Contract with respect to Intellectual Property
(including Contracts with current or former employees, consultants or
contractors regarding the appropriation or the non-disclosure of any of
the Intellectual Property) except for any license implied by the sale of a
product and perpetual, paid-up licenses for commonly available software
programs with a value of less than $1,000 under which an Acquired Company
is the licensee, and the list identifies those pursuant to which an
Acquired Company uses Intellectual Property owned by a third party;
(viii) each Company Contract with any labor union or other employee
representative of a group of employees;
(ix) each Company Contract other than Company Plans involving a
sharing of profits, losses, costs or Liabilities by an Acquired Company
with any other Person;
(x) each Company Contract containing covenants that in any way
purport to restrict the business activity of an Acquired Company or limit
the freedom of an Acquired Company to engage in any line of business or to
compete with any Person;
(xi) each Company Contract providing for payments to or by any
Person based on or determined by reference to sales, purchases or profits,
other than direct payments for goods;
(xii) each power of attorney that is currently effective and
outstanding;
(xiii) each Company Contract entered into other than in the Ordinary
Course of Business that contains or provides for an express undertaking by
an Acquired Company to be responsible for consequential damages;
(xiv) each Company Contract for capital expenditures in excess of
$25,000; and
(xv) each written warranty, guaranty or other similar undertaking
with respect to contractual performance extended by an Acquired Company
other than in the Ordinary Course of Business.
(b) Sellers have delivered to Buyer a true and complete copy (in the case
of each written Company Contract) or an accurate written summary (in the
case of each oral Company Contract) of each of the Company Contracts
listed on Section 3.14(a) of Sellers' Disclosure Schedule.
(c) Each Company Contract required to be listed in Section 3.14(a) of the
Sellers' Disclosure Schedule is in full force and effect and is valid and
enforceable in accordance with its terms. Neither an Acquired Company nor
any other party to a Company Contract has Contravened any of the
applicable terms of a Company Contract. No event has occurred or
circumstance exists that (with or without notice or lapse of time) may
constitute or result directly or indirectly in Contravention of any
Company Contract. No Acquired Company has given or received notice or
other communication (written or oral) regarding any actual, alleged or
potential Contravention of any Company Contract.
68
(d) No party to a Company Contract required to be listed in Section
3.14(a) of the Sellers' Disclosure Schedule has repudiated any provision
of it. There currently are no renegotiations of, attempts to renegotiate
or outstanding rights to renegotiate any Company Contracts required to be
listed in Section 3.14(a) of the Sellers' Disclosure Schedule, nor has any
written demand for renegotiation been made. Sellers have no Knowledge that
any party to a Company Contract required to be listed in Section 3.14(a)
of the Sellers' Disclosure Schedule does not intend to renew it.
3.15 CUSTOMERS AND SUPPLIERS{TC}
Section 3.15 of Sellers' Disclosure Schedule lists the names and addresses of
the 10 largest customers and the 10 largest suppliers (measured in each case by
dollar volume of purchases or sales during the year ended 2001) of the Acquired
Companies, taken as a whole, and the dollar amount of purchases or sales which
each such customer or supplier represented during the years ended 2000 and 2001,
respectively. There exists no actual, and Sellers have no Knowledge of any
threatened, termination, cancellation or material limitation of, or any material
change in, the business relationship of any Acquired Company with any customer,
supplier, group of customers or group of suppliers listed in Section 3.15 of
Sellers' Disclosure Schedule. No customer of any Acquired Company has any right
to any credit or refund for products sold or services rendered or to be rendered
by the Acquired Company pursuant to any Contract, understanding or practice of
the Acquired Company other than pursuant to the standard return policy of the
Acquired Companies described in Section 3.15 of Sellers' Disclosure Schedule.
3.16 INSURANCE{TC}
Each Acquired Company maintains in full force and effect insurance policies
covering its insurable business risks and Liabilities, which, to Sellers' best
Knowledge, provide reasonable protection for the business of and the properties
owned and used by the Acquired Company. Section 3.16 of Sellers' Disclosure
Schedule contains a list and brief description of each (a) insurance policy
issued to an Acquired Company as a "named insured" or otherwise providing
insurance to an Acquired Company as an insured party or additional insured
party, or on any other basis, that was in effect at any time within the past
five years and (b) self-insurance program, retrospective premium program or
captive insurance program in which an Acquired Company has participated at any
time during the past five years. For each such insurance policy, Section 3.16 of
Sellers' Disclosure Schedule sets forth the type of coverage provided by the
policy, whether the policy is provided on a primary, excess, excess umbrella or
other basis, the identity of the named insured, the policy number, the name and
address of the insurance carrier, the annual premium, the policy period and the
policy liability limits (including any deductible or self-insured retention and,
if known, the remaining, intact, unexhausted liability limits). Section 3.16 of
Sellers' Disclosure Schedule also contains a list and brief description of all
circumstances, potential claims, claims, damages, injuries, occurrences, losses
and lawsuits for which an Acquired Company, or any Person on its behalf, has
provided notice to any insurer or otherwise sought coverage under any insurance
policy or program identified in Section 3.16 of Sellers' Disclosure Schedule
(including settled and outstanding claims) since April 30, 1996. The Acquired
Companies have complied with each such insurance policy and program and have not
failed to give any notice or present any claim thereunder in a due and timely
manner which failure would reasonably
69
be expected to result in a loss or forfeiture of any material right thereunder.
No insurance policy held by any Acquired Company is cancelable with less than 30
days written notice.
3.17 TAXES{TC}
(a) The Acquired Companies have filed (or have had filed on their behalf)
on a timely basis all Tax Returns as required by applicable Laws. Each
such Tax Return is accurate and complete in all respects. All Taxes shown
as due and owing on all such Tax Returns have been paid. Except as
otherwise provided for in Section 3.17(a) of Sellers' Disclosure Schedule,
the Acquired Companies have not requested an extension of time within
which to file any Tax Return which has not since been filed.
(b) The Acquired Companies have and will have no additional Liability for
Taxes with respect to any Tax Return which was required by applicable Laws
to be filed on or before the Closing Date, other than those reflected as
liabilities on the Balance Sheet. The amounts reflected as liabilities on
the Balance Sheet for all Taxes are adequate to cover all unpaid
Liabilities for all Taxes, whether or not disputed, that have accrued with
respect to or are applicable to the period ended on and including the
Closing Date or to any years and periods prior thereto and for which any
Acquired Company may be directly or contingently liable in its own right
or as a transferee of the assets of, or successor to, any Person.
(c) No federal, state, local or foreign audits or other Proceedings exist
with regard to any Taxes or Tax Returns of any Acquired Company. None of
the Acquired Companies have received any written notice that an audit or
other Proceeding is pending or threatened with respect to any Taxes due
from or with respect to any Acquired Company or any Tax Return filed by or
with respect to any Acquired Company. The Acquired Companies have not
granted or been requested to grant any waiver of any statutes of
limitations applicable to any claim for Taxes.
(d) All Tax deficiencies that have been claimed, proposed or asserted in
writing against any Acquired Company have been fully paid or finally
settled, and no issue has been raised in writing in any examination which
could be expected to result in the proposal or assertion of a Tax
deficiency for any other year not so examined.
(e) No written position has been taken on any Tax Return with respect to
the business or operations of any Acquired Company for a taxable year for
which the statute of limitations for the assessment of any Taxes with
respect thereto has not expired that is contrary to any publicly announced
position of a taxing authority or that is substantially similar to any
position which a taxing authority has successfully challenged in the
course of an examination of a Tax Return of any Acquired Company.
(f) All Taxes that each Acquired Company is required by Law to withhold or
collect, including sales and use Taxes and amounts required to be withheld
for Taxes of employees, have been duly withheld or collected and, to the
extent required, have been paid over to the proper taxing authority or are
held in separate bank accounts for such purpose.
70
(g) None of the Acquired Companies is or has been a United States real
property holding corporation (as defined in Code Section 897(c)(2)) during
the applicable period specified in Code Section 897(c)(1)(A)(ii).
(h) There are no Encumbrances upon any properties or assets of any
Acquired Company arising from any failure or alleged failure to pay any
Tax (other than Encumbrances relating to Taxes not yet due and payable).
(i) No Acquired Company has made or become obligated to make, and no
Acquired Company will as a result of any Contemplated Transaction become
obligated to make, any payments that could be nondeductible by reason of
Section 280G (without regard to subsection (b)(4) thereof) or 162(m) of
the Code, nor will any Acquired Company be required to "gross up" or
otherwise compensate any individual because of the imposition of any
excise tax on such a payment to the individual.
3.18 EMPLOYEE BENEFITS{TC}
(a) Section 3.18(a) of Sellers' Disclosure Schedule contains an accurate
and complete list of all Company Plans and material Other Benefit
Obligations and sets forth the financial cost of all obligations owed
under any Company Plan or material Other Benefit Obligation that is not
subject to the disclosure and reporting requirements of ERISA. Except for
the Company, no other Acquired Company has adopted or implemented any Plan
or Other Benefit Obligation.
(b) Sellers have delivered to Buyer (i) all documents that set forth the
terms of each Company Plan or material Other Benefit Obligation, and of
any related trust, including all summary plan descriptions, summaries and
descriptions furnished to participants and beneficiaries, (ii) all
personnel, payroll and employment manuals and policies of each Acquired
Company, (iii) a written description of any Company Plan or material Other
Benefit Obligation that is not otherwise in writing, (iv) all registration
statements filed with respect to any Company Plan, (v) all insurance
policies purchased by or to provide benefits under any Company Plan, (vi)
all reports submitted since April 30, 1998, by third-party administrators,
actuaries, investment managers, trustees, consultants or other independent
contractors with respect to any Company Plan or Other Benefit Obligation,
(vii) the Form 5500 filed in each of the most recent three plan years with
respect to each Company Plan and Other Benefit Obligation, including all
schedules thereto and the opinions of independent accountants, (viii) all
notices that were given by any Acquired Company, any ERISA Affiliate or
any Company Plan to the IRS or any participant or beneficiary, pursuant to
statute, since April 30, 1998, including notices that are expressly
mentioned elsewhere in this Section, (ix) all notices that were given by
the IRS or the Department of Labor to any Acquired Company, any ERISA
Affiliate or any Company Plan since April 30, 1998, and (x) with respect
to Company Plans, the most recent determination letter for each such Plan.
(c) The Acquired Companies have performed all of their obligations under
all Company Plans and with respect to all Other Benefit Obligations. The
Acquired Companies have made appropriate entries in their financial
records and statements for all obligations and liabilities under the
Company Plans and Other Benefit Obligations
71
that have accrued but are not due. The Acquired Companies, with respect to
all Company Plans and Other Benefit Obligations, are and each Company Plan
and Other Benefit Obligation is in material compliance with ERISA, the
Code and other applicable Laws, including the provisions of such Laws
expressly mentioned in this Section, and with any applicable collective
bargaining agreement. No transaction prohibited by ERISA Section 406 and
no "prohibited transaction" under Code Section 4975(c) has occurred with
respect to any Company Plan. Neither any Acquired Company nor any Seller
has any Liability to the IRS with respect to any Plan, including any
Liability imposed by Chapter 43 of the Code. All contributions and
payments made or accrued with respect to all Company Plans and Other
Benefit Obligations are deductible under Code Sections 162 or 404. No
event has occurred or circumstance exists that may result in (i) a
material increase in premium costs of Company Plans and Other Benefit
Obligations that are insured or (ii) a material increase in benefit costs
of Company Plans and Other Benefit Obligations that are self-insured.
Other than routine claims for benefits submitted by participants or
beneficiaries, no claim against, or Proceeding involving, any Company Plan
or Other Benefit Obligation is pending or, to Sellers' Knowledge, is
threatened.
(d) Each Qualified Plan of each Acquired Company has received a favorable
determination letter from the IRS that it is qualified under Code Section
401(a) and that its related trust is exempt from federal income tax under
Code Section 501(a), and each such Plan complies in form and in operation
with the requirements of the Code and meets the requirements of a
"qualified plan" under Section 401(a) of the Code. No event has occurred
or circumstance exists that may give rise to disqualification or loss of
tax-exempt status of any such Plan or trust. There is no unfunded
liability under any Company Plan.
(e) No Acquired Company or any ERISA Affiliate has ever established,
maintained or contributed to, or had an obligation to maintain or
contribute to, any Plan that is subject to Title IV of ERISA. No Acquired
Company has ever established, maintained or contributed to, or had an
obligation to maintain or contribute to, any voluntary employees'
beneficiary association under Code Section 501(c)(9), any organization or
trust described in Code Section 501(c)(17) or 501(c)(20), or any welfare
benefit fund as defined in Code Section 419(e). No Acquired Company or any
ERISA Affiliate has ever established, maintained, contributed to or
otherwise participated in, or had an obligation to maintain, contribute to
or otherwise participate in, any Multiemployer Plan. Except to the extent
required under ERISA Section 601 et seq. and Code Section 4980B, no
Acquired Company provides health or welfare benefits for any retired or
former employee nor is any Acquired Company obligated to provide health or
welfare benefits to any active employee following such employee's
retirement or other termination of service.
(f) Each Acquired Company has the right to modify and terminate benefits
to retirees (other than pensions) with respect to both retired and active
employees. Sellers and all Acquired Companies have complied with the
provisions of ERISA Section 601 et seq. and Code Section 4980B and with
the provisions of ERISA Section 701 et seq. and Subtitle K of the Code.
72
(g) The consummation of the Contemplated Transactions will not result in
the payment, vesting or acceleration of any benefit under or in connection
with any Company Plan or Other Benefit Obligation.
3.19 EMPLOYEE RESTRICTIONS{TC}
No director, employee or officer, or to Sellers' best Knowledge, agent,
consultant or contractor of any Acquired Company is a party to, or is otherwise
bound by, any Contract, including any confidentiality, noncompetition or
proprietary rights agreement, with any other Person that in any way adversely
affects or will affect (a) the performance of his or her duties for the Acquired
Companies, (b) his or her ability to assign to an Acquired Company rights to any
invention, improvement, discovery or information relating to the business of the
Acquired Companies, or (c) the ability of the Acquired Companies to conduct
their business. To Sellers' Knowledge, no key employee or group of employees of
the Acquired Companies intends to terminate his/her or their employment with an
Acquired Company within the next 2 years.
3.20 LABOR RELATIONS; EMPLOYMENT LAW COMPLIANCE{TC}
(a) Each Acquired Company has complied in all material respects with all
Laws relating to employment practices, terms and conditions of employment,
equal employment opportunity, nondiscrimination, immigration, wages,
hours, benefits, collective bargaining and plant closing. Section 3.20 of
Sellers' Disclosure Schedule contains a list of all employees of the
Acquired Companies who are not U.S. citizens or permanent residents. Each
of the employees listed on that schedule is authorized under U.S.
immigration laws to work in his or her current position for the Acquired
Company that is his or her employer. Except for the work authorizations
specified in Section 3.20 of Sellers' Disclosure Schedule opposite the
employee's name, none of such employees requires authorization from any
Governmental Body to be employed in his or her current position by the
Acquired Company that is his or her employer. No Acquired Company is
liable for the payment of any fines, penalties or other amounts, however
designated, for failure to comply with any of the foregoing Laws.
(b) No Acquired Company has been, or is now, a party to any collective
bargaining agreement or other labor Contract. No application or petition
is pending for an election of or for certification of a collective
bargaining agent representing any Acquired Company's employees.
(c) Since 1996, there has not been, there is not presently pending or
existing, and to Sellers' Knowledge there is not threatened, any strike,
slowdown, picketing, employee grievance process or other work stoppage or
labor dispute involving an Acquired Company or its Facilities. No event
has occurred or circumstance exists that may provide the basis for any
such work stoppage or labor dispute. There is no lockout of any employees
by an Acquired Company, and no Acquired Company contemplates such action.
(d) There is not pending or, to Sellers' Knowledge, threatened any
Proceeding against or affecting any Acquired Company relating to the
alleged violation of any Law pertaining to labor relations or employment
matters. No grievance or arbitration
73
Proceeding exists that might have an adverse effect upon an Acquired
Company or the conduct of its business. There has been no charge of
discrimination filed against or, to Sellers' Knowledge, threatened against
an Acquired Company with the Equal Employment Opportunity Commission or
similar Governmental Body.
3.21 ENVIRONMENTAL, HEALTH AND SAFETY MATTERS
(a) Section 3.21 of Sellers' Disclosure Schedule lists all permits held by
each of the Acquired Companies required under Environmental Law and
Occupational Safety and Health Law. Each Acquired Company is, and at all
times has been, in material compliance with, and has not been and is not
in material Contravention of or liable under, any Environmental Law or
Occupational Safety and Health Law or any permit issued thereunder.
Neither any Seller nor any Acquired Company has any basis to expect, nor
has any of them or any other Person for whose conduct they are or may be
held responsible received, any actual or threatened Order, notice or other
communication from (i) any Governmental Body or other Person acting in the
public interest, or (ii) the current or prior owner or operator of any
Facility, of any actual or potential violation or failure to comply with
any Environmental Law, or of any actual or threatened obligation to
undertake or bear the cost of any Environmental, Health and Safety
Liabilities with respect to any Facility or other property or asset
(whether real, personal or mixed) in which any Seller or Acquired Company
has had an interest, or with respect to any property or Facility at or to
which Hazardous Materials were generated, manufactured, refined,
transferred, imported, used or processed by Sellers, any Acquired Company,
or any other Person for whose conduct they are or may be held responsible,
or from which Hazardous Materials have been transported, treated, stored,
handled, transferred, disposed, recycled or received.
(b) There are no pending or, to Sellers' best Knowledge, threatened,
claims, Encumbrances or other restrictions of any nature, resulting from
any Environmental, Health and Safety Liabilities or arising under any
Environmental Law or Occupational Safety and Health Law, with respect to
or affecting any Facilities or any other properties and assets (whether
real, personal or mixed) in which any Seller or Acquired Company has or
had an interest.
(c) Sellers have no Knowledge of or any basis to expect, nor has any of
them or any other Person for whose conduct they are or may be held
responsible, received, any citation, directive, inquiry, notice, Order,
summons, warning or other communication (i) that relates to Hazardous
Activity, Hazardous Materials or any actual, alleged or potential
Contravention of or failure to comply with any Environmental Law or
Occupational Safety and Health Law, or (ii) of any actual, alleged or
potential obligation to undertake or bear the cost of any Environmental,
Health and Safety Liabilities with respect to any Facility or other
property or asset (whether real, personal or mixed) in which any Seller or
Acquired Company had an interest, or with respect to any property or
facility to or by which Hazardous Materials generated, manufactured,
refined, transferred, imported, used or processed by any Seller, Acquired
Company, or other Person for whose conduct they are or may be held
responsible, have been transported, treated, stored, handled, transferred,
disposed, recycled or received.
74
(d) Neither any Seller nor any Acquired Company, nor any other Person for
whose conduct they are or may be held responsible, has any Environmental,
Health and Safety Liabilities with respect to any Facility or with respect
to any other property or asset (whether real, personal or mixed) in which
any Seller or Acquired Company (or any predecessor), has or had an
interest, or at any property geologically or hydrologically adjoining any
Facility or any such other property or asset.
(e) There are no Hazardous Materials present on or in the Environment at
any Facility or, to Sellers' best Knowledge, at any geologically or
hydrologically adjoining property, including any Hazardous Materials
contained in barrels, above or underground storage tanks, landfills, land
deposits, dumps, equipment (whether moveable or fixed) or other
containers, either temporary or permanent, and deposited or located in
land, water, sumps or any other part of any Facility or, to Sellers' best
Knowledge, such adjoining property, or incorporated into any structure
therein or thereon. None of Sellers, any Acquired Company, any other
Person for whose conduct they are or may be held responsible, or any other
Person has permitted or conducted, or is aware of, any Hazardous Activity
conducted with respect to any Facility or other property or asset (whether
real, personal or mixed) in which any Seller or Acquired Company has or
had an interest except in material compliance with applicable Laws.
(f) There has been no Release or, to Sellers' best Knowledge, threat of
Release, of any Hazardous Materials at or from any Facility or at any
other location where any Hazardous Materials were generated, manufactured,
refined, transferred, produced, imported, used or processed from or by any
Facility, or from any other property or asset (whether real, personal or
mixed) in which any Seller or Acquired Company has or had an interest, or,
to Sellers' best Knowledge, any geologically or hydrologically adjoining
property, whether by any Seller, Acquired Company or, to Sellers' best
Knowledge, any other Person.
(g) Sellers have delivered to Buyer true and complete copies and results
of any and all reports, studies, analyses, tests or monitoring possessed
or initiated by any Seller or Acquired Company pertaining to Hazardous
Materials or Hazardous Activities in, on or under any Facilities, or
concerning compliance by any Seller, Acquired Company or any other Person
for whose conduct they are or may be held responsible, with Environmental
Laws.
(h) There has not been any closing, termination or transfer, and the
Contemplated Transactions do not constitute a closing, termination or
transfer, of an Acquired Company or the Real Property necessitating
compliance with the Industrial Site Recovery Act or its predecessor, the
Environmental Cleanup Responsibility Act, or any other relevant Law.
3.22 COMPLIANCE WITH LAWS; GOVERNMENTAL AUTHORIZATIONS{TC}
(a) Each Acquired Company is, and at all times since April 30, 1996 has
been, in material compliance with each Law that is or was applicable to it
or to the conduct of its business or the ownership or use of any of its
assets. To Sellers' best Knowledge, no event has occurred or circumstance
exists that (with or without notice or lapse of
75
time) may cause an Acquired Company to Contravene any Law or may give rise
to any obligation on the part of an Acquired Company to undertake, or to
bear all or any portion of the cost of (including but not limited to any
penalty or fine), any remedial action of any nature. No Acquired Company
has received at any time since April 30, 1996 any notice or other
communication (whether oral or written) from any Governmental Body or any
other Person regarding any actual, alleged or potential Contravention of
any Law or any actual, alleged or potential obligation on the part of an
Acquired Company to undertake, or to bear all or any portion of the cost
of (including but not limited to any penalty or fine), any remedial action
of any nature.
(b) Section 3.22(b) of Sellers' Disclosure Schedule contains an accurate
and complete list of each Governmental Authorization that is held by each
Acquired Company or that otherwise relates to the business of, or to any
of the assets owned or used by, an Acquired Company, all of which are
valid and in full force and effect and will remain so following the
Closing. Each Acquired Company is, and at all times since April 30, 1996
has been, in material compliance with all of the terms and requirements of
each such Governmental Authorization. To Sellers' best Knowledge, no event
has occurred or circumstance exists that may (with or without notice or
lapse of time) constitute or result directly or indirectly in
Contravention of any Governmental Authorization. No Acquired Company has
received at any time since April 30, 1996 any notice or other
communication (whether oral or written) from any Governmental Body or any
other Person regarding any actual, alleged or potential Contravention of
any Governmental Authorization. All applications required to have been
filed for the renewal of such Governmental Authorizations have been duly
filed on a timely basis with the appropriate Governmental Bodies, and all
other filings required to have been made with respect to such Governmental
Authorizations have been duly made on a timely basis with the appropriate
Governmental Bodies. All such Governmental Authorizations are renewable by
their terms or in the Ordinary Course of Business without the need to
comply with any special qualification procedures or to pay any amounts
other than routine fees or similar charges.
(c) The Governmental Authorizations listed in Section 3.22(b) of Sellers'
Disclosure Schedule collectively constitute all of the Governmental
Authorizations necessary to permit the Acquired Companies to conduct their
businesses lawfully in the manner in which they currently conduct such
businesses and to permit the Acquired Companies to own and use their
assets in the manner in which they own and use such assets currently.
(d) No Acquired Company nor any Representative of an Acquired Company has,
to obtain or retain business, directly or indirectly offered, paid, or
promised to pay, or authorized the payment of, any money or other thing of
value (including any fee, gift, sample, travel expense or entertainment
with a value in excess of $100 in the aggregate to any one individual in
any year) to (i) any Person who is an official, officer, agent employee or
representative of any Government Body, or any existing or prospective
customer (whether government-owned or non-government-owned), (ii) any
political party or official thereof, (iii) any candidate for political or
political party office, or (iv) any other individual or entity; while
knowing or having reason to believe that all or any portion of such money
or thing of value would be offered, given, or promised, directly or
indirectly, to any such official, officer, agent,
76
employee, representative, political party, political party official,
candidate, individual or any entity affiliated with such customer,
political party or official, or political office.
(e) Each Acquired Company has made all payments to third parties by check
mailed to such third parties' principal place of business or by wire
transfer to a bank located in the same jurisdiction as such party's
principal place of business.
(f) Each material transaction is properly and accurately recorded on the
books and records of the appropriate Acquired Company, and each document
on which entries in the Acquired Companies' books and records are based is
accurate and complete in all respects.
(g) Section 3.22(g) of Sellers' Disclosure Schedule lists all foreign
transactions engaged in by each of the Acquired Companies. Each Acquired
Company has at all times complied with all Laws relating to export
controls and trade sanctions. No product sold or service provided by an
Acquired Company since April 30, 1996, has been, directly or indirectly,
sold to or performed on behalf of Afghanistan, Cuba, Iraq, Iran, Libya,
Myanmar (Burma), Sudan, Syria, North Korea or Yugoslavia.
(h) Since April 30, 1996, no Acquired Company has been a party to or a
beneficiary under any Contract under which a product has been sold or
services provided to customers in Bahrain, Iraq, Kuwait, Jordan, Lebanon,
Libya, Oman, Qatar, Saudi Arabia, Sudan, Syria, United Arab Emirates or
the Republic of Yemen.
3.23 LEGAL PROCEEDINGS; ORDERS{TC}
(a) Section 3.23(a) of Sellers' Disclosure Schedule lists any and all
pending Proceedings (i) by or against any Acquired Company or that
otherwise relate to or may affect the business of, or any of the assets
owned or used by, any Acquired Company or (ii) that challenge, or that may
have the effect of preventing, delaying, making illegal or otherwise
interfering with, any of the Contemplated Transactions. To Sellers'
Knowledge, no other such Proceeding has been threatened. Sellers have
delivered to Buyer copies of all pleadings, correspondence and other
documents relating to such Proceedings. Such Proceedings will not, in the
aggregate, have a material adverse effect on the financial or other
condition, results of operations, assets, Liabilities, equity, business or
prospects of any Acquired Company.
(b) Section 3.23(b) of Sellers' Disclosure Schedule lists each Order to
which any Acquired Company, or any of the assets owned or used by any
Acquired Company , is or has been subject. To Sellers' Knowledge, no
officer, director, agent or employee of any Acquired Company is subject to
any Order that prohibits such officer, director, agent or employee from
engaging in or continuing any conduct, activity or practice relating to
the business of any Acquired Company.
(c) Each Acquired Company is, and at all times since April 30, 1996 has
been, in full compliance with all of the terms and requirements of each
Order to which it, or any of the assets owned or used by it, is or has
been subject. No event has occurred or circumstance exists that may
constitute or result in (with or without notice or lapse of time) a
violation of or failure to comply with any term or requirement of any
Order to
77
which any Acquired Company, or any of the assets owned or used by any
Acquired Company, is subject. No Acquired Company has received, at any
time since April 30, 1996, any notice or other communication (whether oral
or written) from any Governmental Body or any other Person regarding any
actual, alleged or potential violation of, or failure to comply with, any
term or requirement of any Order to which any Acquired Company, or any of
the assets owned or used by any Acquired Company, is or has been subject.
3.24 RELATIONSHIPS WITH RELATED PERSONS{TC}
Except as provided for in Section 3.24 of Sellers' Disclosure Schedule, no
Seller or any Related Person of any Seller or Acquired Company has, or since May
1, 1999 has had, any interest in any property (whether real, personal or mixed
and whether tangible or intangible), used in or pertaining to any Acquired
Company's business. No Seller nor any Related Person of any Seller or Acquired
Company owns, or since May 1, 1999 has owned, (of record or as a beneficial
owner) an equity interest or any other financial or profit interest in a Person
that has (a) had business dealings or a material financial interest in any
transaction with an Acquired Company, or (b) engaged in competition with an
Acquired Company with respect to any line of the products or services of the
Acquired Company in any market presently served by the Acquired Company except
for less than 1% of the outstanding capital stock of any competing business that
is publicly traded on any recognized exchange or in the over-the-counter market.
No Seller or any Related Person of any Seller or Acquired Company is a party to
any Contract with, or has any claim or right against, an Acquired Company.
3.25 SECURITIES LAW MATTERS{TC}
Sellers are acquiring the Promissory Notes for their own account and not with a
view to distribution within the meaning of Section 2(11) of the Securities Act.
Sellers confirm that Buyer has made available to Sellers and their
Representatives the opportunity to ask questions of the officers and management
employees of Buyer and to acquire such additional information about the business
and financial condition of Buyer as Sellers have requested, and all such
information has been received.
3.26 BROKERS OR FINDERS{TC}
Except as listed in Section 3.26 of Sellers' Disclosure Schedule, neither
Sellers, the Company nor any of their respective Representatives have incurred
any Liability for brokerage or finders' fees or agents' commissions or other
similar payment in connection with the Contemplated Transactions.
3.27 DISCLOSURE{TC}
No representation or warranty of Sellers in this Agreement and no statement in
Sellers' Disclosure Schedule omits to state a material fact necessary to make
the statements herein or therein, in light of the circumstances in which they
were made, not misleading. Nothing in Sellers' Disclosure Schedule contains any
untrue statement or omits to state a material fact necessary to make the
statements therein or in this Agreement, in light of the circumstances in which
they were made, not misleading.
78
3.28 MATERIALITY{TC}
Any representation and warranty of the Sellers in this Agreement qualified by
materiality shall also include any respective immaterial events, provided that,
those immaterial events, taken in the aggregate, constitute a material event for
that representation and warranty.
[THE REST OF THIS PAGE IS INTENTIONALLY LEFT BLANK]
79
SCHEDULE 9
PERSONAL GUARANTEES
Personal Guarantees in relation to the following loan agreements and security:
1. Rizal Commercial Banking Corporation
(a) Comprehensive Surety Agreement dated 20 September 2000 between
Xxxxxx Xxxxxxx Xxxxxxx and Rizal Commercial Banking Corporation.
(b) Real Estate Mortgage Agreement between Xxxxxx Xxxxxxx Tanseco and
Rizal Commercial Banking Corporation covering Condominium
Certificate of Title Nos. 58401, 58402, 58403, 58404, 58405, 58406,
58407, 58408, 58409, 58420, 58421, 58422, 58423, 58424, 58425,
58426, 58427, 58428, 58429, 58430, 58431, 58432, 58433, 58434,
58436, 58437, 58438, 58440, 58562, 58564, 58565, 58566, 58568 and
58571.
2. Banco de Oro Universal Bank
(a) Continuing Surety Agreement dated 30 May 2001 between Solemar
Development Corporation and Banco de Oro Universal Bank.
(b) Real Estate Mortgage Agreement between
- Solemar Development Corporation and Banco de Oro Universal
Bank covering Transfer Certificate of Title Nos. 44438 and
32596.
- Xxxxxx Xxxxxxx Xxxxxxx (and family) and Banco de Oro Universal
Bank covering Transfer Certificate of Title No. 132902.
- Xxxxxx Xxxxxxx Tanseco (and family) and Banco de Oro Universal
Bank covering Condominium Certificate of Title Nos. 58435,
58439, 58553, 58563 and 58567.
(c) Assignment of leasehold contracts and Special Power of Attorney
dated 31 May 2001 from Solemar Development Corporation to Banco de
Oro Universal Bank.
3. Bank of the Philippine Islands
(a) Comprehensive Surety Agreement dated 22 December 2000 between Xxxxxx
Xxxxxxx Xxxxxxx and Bank of the Philippine Islands.
80
SCHEDULE 10
FORM OF PROMISSORY NOTE
PROMISSORY NOTE
US $6,500,000 Date: [-]
FOR VALUE RECEIVED, INFINITI SOLUTIONS PTE LTD, a company organized under the
laws of Singapore with its registered office at 0000 Xxxxx Xxxx #00-00 Xxxxxx
Xxxx Xxxxxxx, Xxxxxxxxx 000000 (the "BORROWER"), promises to pay to AML TRADING
LIMITED, a company incorporated in the British Virgin Islands with International
Business Company Number 386647 whose registered office is at Beaufort House,
Tropic Isle Building, PO Box 438, Road Town, Tortola, British Virgin Islands
(the "HOLDER"), the principal sum of US$6,500,000 or such lesser amount as shall
then equal the outstanding principal amount hereof, together with interest from
the date of this promissory note (this "NOTE") on the unpaid principal balance
at the simple interest rate of 5% per annum (the "INTEREST RATE"). Interest
shall accrue and be computed on the basis of the actual number of days elapsed
in a 365 day year. The unpaid principal shall be payable in four installments
(collectively, the "INSTALLMENTS" and each, an "INSTALLMENT") and all unpaid
principal together with the balance of unpaid and accrued interest shall be due
and payable on the Maturity Date (as defined below) in respect of each
Installment, or when such amounts in respect of each Installment are declared
due and payable by the Holder upon or after the occurrence of an Event of
Default (as defined below). Capitalized terms not otherwise defined herein shall
have the meaning set forth in the Share Purchase Agreement dated [-] November
2002 (the "SHARE PURCHASE AGREEMENT") entered into by and among the Borrower,
Automated Technology (Phil.) Inc. ("ATEC"), Mayon Capital Limited, Gold Xxxx
Limited, Global Crown Limited and Finetech International Limited (collectively
the "BVI COMPANIES") and the shareholders of the BVI Companies.
The following is a statement of the rights of the Holder and the conditions to
which this Note is subject, and to which the Holder hereof, by the acceptance of
this Note, agrees:
1. Maturity Dates. The dates upon which the Installments, together with the
balance of unpaid and accrued interest in relation to each Installment,
shall be due and payable (collectively, the "MATURITY DATES" and each, a
"MATURITY DATE") shall be as set out below:
Installment Maturity Date
----------- -------------
US$1,500,000 180 days from the Completion Date
US$1,500,000 365 days from the Completion Date
US$1,500,000 540 days from the Completion Date
US$2,000,000 730 days from the Completion Date
81
For the purposes of this Note, "COMPLETION DATE" shall have the meaning
ascribed to it in the Share Purchase Agreement.
In no event, however, shall any Maturity Date fall on a national holiday
(in Singapore) or weekend, but instead such Maturity Date shall be the
first business day following such national holiday or weekend.
2. Events of Default. The occurrence of any of the following shall constitute
an "EVENT OF DEFAULT" under this Note:
(a) Failure to Pay. The Borrower shall fail to pay, within thirty (30)
days after the Maturity Date for the relevant Installment, any
principal payment due in respect of that Installment, or any
interest required under the terms of this Note in respect of that
Installment; or
(b) Voluntary Bankruptcy or Insolvency Proceedings. The Borrower shall
(i) be unable to pay its debts generally as they mature, (ii)
commence a voluntary case or other proceeding seeking relief under
any bankruptcy, insolvency or other similar law now or hereafter in
effect or consent to any such relief or to the appointment of or
taking possession of his property by any official in an involuntary
case or other proceeding commenced against him, or (iii) take any
action for the purpose of effecting any of the foregoing.
3. Rights of the Holder Upon Event of Default under Clause 2(a). Upon the
occurrence or existence of an Event of Default under Clause 2(a) above,
the Borrower shall pay interest to the Holder at the rate of 10% per annum
calculated based on the outstanding principal amount of the relevant
Installment, for the period commencing on the Maturity Date for that
relevant Installment and ending on the date of actual payment of the
outstanding amount of such Installment. For the avoidance of doubt, such
interest shall not apply to any Installments in respect of which the
Borrower is not in default under Clause 2(a). These other Installments
shall remain payable in accordance with the Maturity Dates in Clause 1.
4. Rights of the Holder Upon Event of Default under Clause 2(b). Upon the
occurrence or existence of an Event of Default under Clause 2(b) above,
irrespective of whether or not Clause 2(a) also applies, then at any time
thereafter during the continuance of such Event of Default, the Holder may
declare all outstanding unpaid principal and accrued interest due under
this Note (and not just any Installment), to be immediately due and
payable.
5. Rights of the Holder Upon Any Event of Default. In addition to the
remedies under Clause 3 and 4 above, upon the occurrence or existence of
any Event of Default, the Holder may exercise any other right, power or
remedy granted to it or otherwise permitted to it by law, either by suit
in equity or by action at law, or both.
6. Prepayment. Each Installment of this Note may be prepaid in whole or in
part at any time by the Borrower without penalty and without the prior
written consent of the Holder.
82
7. Successors and Assigns. The rights and obligations of the Borrower and the
Holder of this Note shall be binding upon and benefit the successors,
assigns, heirs, administrators and transferees of the parties.
8. Waiver and Amendment. The provisions of this Note may not be modified,
amended or waived except in a writing signed by both the Holder and the
Borrower.
9. Notices. Any notice, request or other communication required or permitted
hereunder shall be in writing and shall be deemed to have been duly given
if personally delivered or mailed by registered or certified mail, postage
prepaid, or by recognized overnight courier or personal delivery at the
respective addresses of the parties as set forth below such parties' name
on the signature page hereto. Any party hereto may by notice so given
change its address for future notice hereunder. Notice shall conclusively
be deemed to have been received when delivered.
10. Payments. Payments shall be made in lawful tender of the United States.
11. Prevailing Party. In the event that litigation or quasi-judicial
proceeding is commenced by the Borrower or the Holder with respect to the
enforcement of any provisions hereof, the prevailing party shall be
entitled to recover its costs and expenses, including reasonable
attorneys' fees.
12. Governing Law. This Note and all actions arising out of or in connection
with this Note shall be governed by and construed in accordance with the
laws of Singapore.
IN WITNESS WHEREOF, the Borrower has caused this Note to be issued as of the
date first written above.
INFINITI SOLUTIONS PTE LTD
By:_____________________________
Name: Xxxxxxxx Xxxxx
Title: CEO
Address: 00, Xxxx Xxxxx Xxxxxxxx, #00-00
Xxxxxxxxx 000000
Phone: (00) 0000-0000
Facsimile: (00) 0000-0000
83
Acknowledged and agreed:
_____________________________
By: Xxxxxx Xxxxxxx Xxxxxxx
for and on behalf of
AML TRADING LIMITED
Address:
Phone:
Facsimile:
84
IN WITNESS WHEREOF THIS AGREEMENT HAS BEEN EXECUTED BY THE PARTIES.
SIGNED by ) /s/ Xxxxxxxx Xxxxx
XXXXXXXX XXXXX )
for and on behalf of )
INFINITI SOLUTIONS PTE LTD )
in the presence of: )
/s/ XXXXXX XXXXXX
---------------------------------------
Name of witness: XXXXXX XXXXXX
SIGNED by ) /s/ Antonio Bolosa Xxxxxxxxx
XXXXXXX BOLOSA VILLARUEL )
for and on behalf of )
AUTOMATED TECHNOLOGY )
(PHIL.) INC. )
in the presence of: )
/s/ XXXX XXXXXXX XXXXXXXX
---------------------------------------
Name of witness: Xxxx Xxxxxxx Xxxxxxxx
SIGNED by ) /s/ Xxxxxx Xxxxxxx Xxxxxxx
XXXXXX XXXXXXX XXXXXXX )
in the presence of: )
/s/ XXXX XXXXXXX XXXXXXXX
---------------------------------------
Name of witness: Xxxx Xxxxxxx Xxxxxxxx
SIGNED by ) /s/ Xxxxxx Xxxxxxx Tanseco
XXXXXX XXXXXXX XXXXXXX )
for and on behalf of )
AML TRADING LIMITED )
in the presence of: )
/s/ XXXX XXXXXXX XXXXXXXX
---------------------------------------
Name of witness: Xxxx Xxxxxxx Xxxxxxxx
85
SIGNED by ) /s/ Xxxxxx Xxxxxxx Tanseco
XXXXXX XXXXXXX XXXXXXX )
as attorney-in-fact )
for and on behalf of )
)
ANTONIO BOGLOSA )
VILLARUEL )
)
XXXXXXX XXXXXXXXXX )
XXXXXXXXXX )
)
MILA XXXXXX XXXXXXX )
)
XXXXXXX X. XXXXX )
)
XXXXXX XXXXXX L. XXX )
)
XXXXXXXX XX DEL XXXXXXX )
)
XXXXXXX XXXXXXXX XXXXXX )
)
XXXXXX XXXXX FLAVIER )
)
in the presence of: )
/s/ XXXXXXX XXXXX DEL XXXXXXXX
---------------------------------------
Name of witness: XXXXXXX XXXXX DEL XXXXXXXX
SIGNED by XXXXXX XXXXXXX TANSECO /s/ Xxxxxx Xxxxxxx Xxxxxxx
)
for and on behalf of )
MAYON CAPITAL LIMITED )
in the presence of: )
/s/ XXXX XXXXXXX XXXXXXXX
---------------------------------------
Name of witness: Xxxx Xxxxxxx Xxxxxxxx
SIGNED by XXXXXX XXXXXXX XXXXXXX /s/ Xxxxxx Xxxxxxx Tanseco
)
for and on behalf of )
GLOBAL CROWN LIMITED )
in the presence of: )
/s/ XXXX XXXXXXX XXXXXXXX
---------------------------------------
Name of witness: Xxxx Xxxxxxx Xxxxxxxx
86
SIGNED by XXXXXX XXXXXXX XXXXXXX /s/ Xxxxxx Xxxxxxx Tanseco
)
for and on behalf of )
GOLD XXXX LIMITED )
in the presence of: )
/s/ XXXX XXXXXXX XXXXXXXX
---------------------------------------
Name of witness: Xxxx Xxxxxxx Xxxxxxxx
SIGNED by XXXXXX XXXXXXX TANSECO ) /s/ Xxxxxx Xxxxxxx Xxxxxxx
)
for and on behalf of )
FINETECH INTERNATIONAL )
LIMITED )
in the presence of: )
/s/ XXXX XXXXXXX XXXXXXXX
---------------------------------------
Name of witness: Xxxx Xxxxxxx Xxxxxxxx
87
