EXHIBIT 10.1
TECHNOLOGY PURCHASE AGREEMENT
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This Technology Purchase Agreement (the "Agreement") is entered into by and
among the following:
1. XXXXX SOFTWARE TECHNOLOGY,
a company formed according to the laws
of the island of Nevis.
(hereinafter " Xxxxx").
2. MERCURY INTERACTIVE CORPORATION,
a company formed according to the
laws of the State of Delaware, having its
principal offices at 000 Xxxxxxx Xxxxxx,
Xxxxxxxxx, Xxxxxxxxxx 00000, X.X.X.
(hereinafter "the Buyer").
WHEREAS Xxxxx is the legal owner of the know-how and R&D in process, and all
related technical information whether tangible or intangible, including without
limitation any data, designs, calculations, computer source codes (human
readable format) and executables and object codes (machine readable format),
specifications, test and installation, instructions, service and maintenance
notes, technical, operating and service and maintenance manuals, user
documentation, training materials, and other data, information, know-how and all
goodwill associated therewith, in each case which are in the possession of,
owned by or licensed to Xxxxx and are necessary or desirable to enhance,
develop, manufacture, assemble, service, maintain, install, operate, use or test
the Technology. as described in Appendix 1 attached to this Agreement,
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hereinafter the "Technology"; and
WHEREAS the Buyer is interested in acquiring the rights to the "Technology", in
order to further develop the Technology.
NOW THEREFORE, in consideration of the representations, warranties, covenants,
and agreements of the parties hereinafter set forth, the parties hereto,
intending to be legally bound, do hereby agree as follows:
1. SALE AND PURCHASE OF THE TECHNOLOGY
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1.1. Sale and Purchase of the Technology
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(a) Xxxxx hereby sells, assigns and transfers all of its right,
title and interest in and to the Technology at the purchase
price of US $ 4.5 million ("the "Purchase Price"), and the
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Buyer agrees to purchase such technology for the purchase
price.
1.2. CLOSING
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(a) Subject to satisfaction or waiver of the conditions
precedent to the obligations of the parties hereto and the
execution and delivery of this Agreement and all other
documents required by this Agreement, the purchase of the
Technology shall take place on or before September 30,
1997, or other time and place as the Buyer and Xxxxx
designate orally or in writing (which time and place are
designated as the "Closing") and the payment shall take
place on or before December 31, 1997.
(b) At the Closing Xxxxx shall deliver, (i) written technical
documentation of the Technology to be given at Closing to
the Buyer, and (ii) such assignments as shall reasonably be
requested.
(c) Payment shall be made to Xxxxx by the Buyer in U.S.dollars.
2. REPRESENTATIONS AND WARRANTIES OF XXXXX
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Xxxxx hereby represents and warrants that the representations and
warranties of Xxxxx in this Section 2 are correct and complete as of
the date of this Agreement.
2.1. Organization
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Xxxxx is a corporation duly organized, validly existing and in
good standing under the laws of the Isle of Nevis. Xxxxx has all
requisite power and authority to execute, deliver, and perform its
obligations under this Agreement and to consummate the
transactions contemplated hereby and thereby, and Xxxxx has all
requisite power and authority to own. Lease or otherwise use the
Technology and to carry on its business as now being conducted.
Xxxxx is duly qualified or licensed to do business as a foreign
corporation and is in good standing in each jurisdiction in wich
the character of its business or asset makes such qualification
necessary, except where the failure to be so qualifies or licensed
would not have a material adverse effect on the Technology or
Xxxxx'x ability to perform its obligations hereunder.
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2.2. Authorization
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All corporate action on the part of Xxxxx directors and
shareholders necessary for the authorization, execution and
delivery of this Agreement, the performance of all obligations of
Xxxxx hereunder, and the sale and the assignment of the Technology
has taken or will have taken place prior to the Closing. This
Agreement constitutes a valid and legally binding obligation of
Xxxxx enforceable in accordance with its terms.
2.3. Litigation
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To the best knowledge of Xxxxx, as of the date of signature of
this Agreement:
(a) There are no claims, actions, suits, proceedings or
investigations pending or currently threatened against
Xxxxx and/or its directors and officers, which question the
validity of this Agreement or the right to enter into it, or
to consummate the transaction contemplated hereby, or which
might result either individually or in the aggregate in any
material adverse right of the Buyer to the Technology,
except as described on the Disclosure Schedule, if any.
(b) The foregoing includes, without limitation, actions pending
or threatened involving the present or prior employment of
Xxxxx'x employees and/or consultants, their use in
connection with its business of any information or
techniques allegedly proprietary to any of its former
employers or consultancy arrangements, or their obligations
under any agreements with prior employers or consultancy
arrangements.
(c) The Technology is not subject to the provisions of any
order, writ, injunction, judgement or decree of any court or
government agency or instrumentality and there is no action,
suit, proceeding or investigation against Xxxxx with respect
to the Technology, by any government agency or
instrumentality currently pending or which any one of them
intends to initiate.
2.4. Technology
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(One) Xxxxx owns all right, title and interest in and to the
Technology, free and clear of any liens, encumbrances or claims
by third parties. Xxxxx has and will deliver to Buyer, at
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the Closing, good and marketable title to the Technology. Xxxxx
has not infringed, and is not now infringing, on any trade secret
or copyright belonging to any other person or entity.
(Two) Xxxxx has not distributed or divulged Confidential
Information constituting the Technology, and Xxxxx is not a party
to any license, agreement or arrangement, whether as licensee,
licensor or otherwise, with respect to the Technology. Xxxxx has
taken all reasonable security measures to protect the secrecy,
confidentiality and value of the Technology and any of its
employees and any other persons who, either alone or in concert
with others, developed, invented, discovered, derived, programmed
or designed these secrets, or who have knowledge of or access to
information relating to them, have entered into agreements that
these secrets are proprietary to Xxxxx and not to be divulged or
misused.
(Three) No employee or subcontractor of Xxxxx is, or to the best
knowledge of Xxxxx. Is now expected to be, in default under any
term of any employment contract. nondisclosure obligation,
agreement or arrangement relating to the Technology or any
noncompetition agreement, contract or restrictive covenant
relating to the Technology or its development or exploitation. The
Technology (i) was developed by employees of Xxxxx in the course
of such employees employment by Xxxxx, (ii) constitutes" works
made for hire" of Xxxxx with in the meaning of the United States
Copyright Act of 1976, as amended, or (iii) has been validly
assigned to Xxxxx.
2.5. Compliance with Other Instruments and Laws
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(a) Xxxxx is not in default of any provisions of its respective
company documents or Protocols, of any instrument,
judgement, order, writ, decree or contract to which it is a
party or by which it is bound or, of any provision of law
applicable to it, that would prevent it from executing and
delivering the Agreement.
(b) The execution, delivery and performance of this Agreement
and the consummation of the transactions contemplated hereby
will not result in any such violation of applicable
statutes, laws and regulations.
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2.6. Agreements; Default
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(a) There are no agreements, understandings or proposed
transactions between Xxxxx and/or any of its officers,
directors, shareholders, affiliates, or any affiliate
thereof, except as identified in the Disclosure Schedule, if
any, that would effect the ownership by the Buyer of the
Technology. There is no default, or event that with notice
or lapse of time, or both, would constitute a default, by
Xxxxx, or to the best knowledge and belief of Xxxxx, of any
other party to any of the contracts, agreements or
understandings listed in the Disclosure Schedule.
(b) The consummation of the transactions contemplated by this
Agreement will not result in or constitute any of the
following: (i) a default, breach or violation or an event
that, with notice or lapse of time or both, would constitute
a default, breach or violation of the Memorandum and
Articles of Association of Xxxxx, or any contract, license,
agreement or understanding to which Xxxxx'x property is
bound; (ii) an event that would permit any party to
terminate any or to accelerate the maturity of any
indebtedness or other direct or indirect obligation of
Xxxxx; or (iii) the creation or imposition of any lien,
charge or encumbrance on any of the properties of Xxxxx.
2.7. NO INSOLVENCY
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Xxxxx will not be rendered insolvent by the sale, transfer and
assignment of the Technology pursuant to the terms of this
agreement.
2.8. REPRESENTATIONS COMPLETE
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None of the representations or warranties made by Xxxxx, nor any
statement made in any certificate furnished by Xxxxx pursuant to
this Agreement, contains any untrue statement of a material fact,
or, to the best knowledge of Xxxxx, omits any material fact
necessary in order to make the statements contained herein or
therein, in the light of the circumstances under which made not
misleading. There is no fact, circumstance or condition of any
kind or nature whatsoever known to Xxxxx which reasonably would be
expected to have a material adverse effect on Xxxxx or the
Technology that has not been set forth in this Agreement.
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3. REPRESENTATIONS AND WARRANTIES OF THE BUYER
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The Buyer represents and warrants to Xxxxx that:
3.1. Company Existence; Authorization
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(a) The Buyer is duly organized and properly registered in the
jurisdiction of its organization. All action on the part of
the Buyer, its officers, directors and shareholders
necessary for the authorization, execution and delivery of
this Agreement, and the performance of all obligations
hereunder has been taken or will be taken prior to the
Closing, and this Agreement constitutes a valid and legally
binding obligation of the Buyer enforceable in accordance
with its terms, subject only to laws affecting the rights
and remedies of creditors.
(b) The Buyer is not in default of any provisions of any
instrument, judgment, order, writ, decree or contract to
which it is a party or by which it is bound or, of any
provision of law applicable to it, that would prevent it
from executing and delivering the Agreement.
(c) The Buyer agrees that it has been fully provided with all
the information which the Buyer has requested for deciding
whether or not to purchase the Technology and all
information which they believe is reasonably necessary to
enable the Buyer to make such a decision.
4. CONDITIONS PRECEDENT TO THE BUYER'S OBLIGATIONS AT CLOSING
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The obligations of the Buyer to enter into the transaction contemplated by
this Agreement are subject to the satisfaction, or waiver in writing by
the Buyer, at or before the Closing of each of the following conditions.
4.1. Representations and Warranties
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The representations and warranties of Xxxxx contained in this
Agreement, shall be true and correct on the date hereof and on and
as of the Closing as though made on such date, except as amended
by Xxxxx at the Closing and which amendment shall be specifically
approved by the Buyer.
4.2. Performance
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Xxxxx shall have performed and complied with all covenants,
agreements, obligations and conditions contained in this
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Agreement that are required to be performed, satisfied or complied
with by it on or before the Closing.
4.3. Proceedings, Documents and Certificates
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All corporate and other proceedings in connection with the
transactions contemplated at the Closing and all documents
incident thereto shall be reasonably satisfactory in form and
substance, and they shall have received all such counterpart,
original and certified or other copies of such documents as they
may reasonably request.
4.4. Covenant Not To Compete
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In consideration of the sale of the goodwill associated with the
Technology, Xxxxx agrees that after the Closing for a period of 3
years, Xxxxx or its associates will not develop, market or
otherwise produce a product or technology that competes, directly
or indirectly, with the Technology.
5. INDEMNIFICATION
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5.1. Xxxxx hereby agrees to indemnify and hold Buyer and its affiliates
and the officers, directors, employees, agents and representatives of
Buyer and its affiliates, and any person claiming by or through any of
them, harmless from, against and in respect of the following:
(One) Losses arising from or related to the ownership, possession,
operation or use of the Technology, by Xxxxx at or prior to the
Closing;
(Two) Losses arising from or related to any breach of or inaccuracy
in any representation or warranty made by Xxxxx in this Agreement,
whether or not such breach or inaccuracy was or should have been
known by Buyer.
(Three) Losses arising from or related to any breach or violation
by Xxxxx of any of its covenants and agreements contained in this
Agreement.
5.2. INDEMNIFICATION BY BUYER
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Buyer hereby agrees to indemnify and hold Xxxxx and its Affiliates and
the officers, directors, employees, agents and representatives of
Xxxxx, and any person claiming by or through any of them, harmless
from, against and in respect of Losses arising from or related to any
breach of or inaccuracy in any representation or warranty made by or
behalf of buyer in this Agreement, whether or not such breach or
inaccuracy was or should have been known by Xxxxx or Losses arising
from or related to any breach or violation by buyer of any of its
covenants and agreements contained in this Agreement.
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5.3. SURVIVAL OF REPRESENTATION AND WARRANTIES
-----------------------------------------
The representations and warranties of Xxxxx and Buyer contained herein
shell survive the closing for a period of two years from the Closing
Date, provided, however, that representations and warranties with
respect to which a claim is made within the applicable survival period
shell survive until such claim is finally determined and paid.
5.4. NOTIFICATION OF CLAIMS
----------------------
A party seeking indemnification under this Article 5 (an "indemnified
party") shall, promptly after the receipt of notice of the assertion
of any claim or commencement of any action, suit, arbitration,
inquiry, proceeding or investigation by or before any governmental
authority (an "action") (but in no event later then 10 days prior to
the date any response or answer is due in any proceeding) in respect
of which indemnity may be sought from a party against whom an
indemnity obligation is asserted pursuant to this Article 5 (an
"indemnifying party") on account of the indemnity agreement contained
above, notify the indemnifying party in writing of the receipt of such
claim or the commencement of such action. The omission of an
indemnified party so to notify an indemnifying party of any such claim
or action shall not relieve the indemnifying party from any liability
in respect of such claim or action which it may have to the
indemnified party (except, however, that the Indemnifying party shall
be relieved of liability to the extent that the failure so to notify
(a) shall have caused prejudice to the defense of such claim or action
or (b) shall have increased the costs or liability of the indemnifying
party reason of the inability or failure of the indemnifying party
(because of the lack of prompt notice from the indemnified party) to
be involved in any investigations or negotiations regarding any such
claim or action), nor shall it relieve the indemnifying party from any
other liability which it may have to the indemnified party. In case
any such claim shall be asserted or action commenced against an
indemnified party and shall notify the indemnifying party thereof, the
indemnifying party shall be entitled to participate in the negotiation
or administration thereof and, to the extent it may wish, to assume
the defense thereof with counsel reasonably satisfactory to the
Indemnified party, and, after notice from the Indemnifying party to
the Indemnified party of its election so to assume the defense
thereof, which notice shall be given within 30 days of its receipt of
such notice from such indemnified party, the Indemnified party shall
not be liable to the indemnified party hereunder for any legal or
other expenses subsequently incurred by the indemnified party in
connection with the defense thereof other than reasonable costs of
investigation. If an Indemnifying party does not wish to assume the
defense, conduct or settlement of any claim or Action, the Indemnified
party shall not settle such claim or action without the written
consent of the Indemnifying party, which consent shall not be
unreasonably withheld or delayed.
5.5. LIMITATIONS ON INDEMNIFICATION
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Each parties liability to other for indemnification payments under
this Article 5 shall be limited to aggregate indemnification payments
by either party to other equal to the Purchase Price.
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6. CONFIDENTIALITY
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6.1. Each of the parties agree that with the respect to certain
Confidential Information (as defined below and without respect to
the date on which such Confidential Information was first disclosed)
furnished to it by the other party to this Agreement, it will
maintain such information in confidence in the same manner, and to
the same extent it protects its own confidential and/or proprietary
information of a similar nature. Each party shall be responsible for
any breach of this agreement by any and all employees, agents,
parents, subsidiaries, affiliates, or similar persons or entities.
6.2. For the purposes of this Agreement, Confidential Information shall
include any trade secrets, knowledge, data, or other proprietary or
confidential information relating to products, processes, know-how,
designs, formulae, developmental or experimental work, computer
programs, databases, other original works of authorship, customer
lists, business plans, marketing plans and strategies, financial
information, or other subject matter pertaining to any business of
the parties hereto, or any of its clients, consultant; or licensees
that is defined in writing or orally as Confidential Information.
6.3. The commitment as stated above shall not impose any obligation with
respect to any portion of the information that (i) is now or
hereafter becomes generally know or available or a part of a public
domain without direct or indirect fault of the recipient of
Confidential Information or otherwise by breach of this Agreement or
similar agreement; or (ii) is known to such recipient at the time of
the disclosure of such Confidential Information as evidenced by
prior written documentation in such parties files; or (iii) is
furnished to others by the owner of the Confidential Information
without restriction of further disclosure; or (iv) is lawfully
received by such recipient without confidential or proprietary
restriction from a source other than the owner of the Confidential
Information . Neither party shall use any Confidential Information
for the purposes of unfair or improper competition, such as, by way
of example only and not limitation, soliciting accounts of employees
of the other party.
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7. TERMINATION PRIOR TO CLOSING
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This Agreement may be terminated at any time prior to the Closing as
follows:
7.1. By the mutual consent of the Parties in writing.
7.2. Either party may terminate this agreement If the other party
breaches any warranty or fails to perform any material obligation
hereunder, and such breach is not remedied within twenty one (21)
days after written notice thereof to the party in default or If
prior to the completion of the payment by the Buyer and/or of the
transfer of Technology by Xxxxx, all in accordance with this
agreement, the other party shall become insolvent or make an
assignment for the benefit of creditors, or if a receiver or similar
officer shall be appointed to take charge of all or part of that
party's assets, and such status and/or assignment and/or appointment
has not been canceled within sixty (60) days.
8. MISCELLANEOUS
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8.1. Survival
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The representations and warranties of the parties to this
Agreement, contained in or made pursuant to this Agreement shall
survive the execution and delivery of this Agreement and the
Closing and shall in no way be affected by any investigation of
the subject matter thereof made by or on behalf of the parties.
8.2. Successors and Assigns
----------------------
Except as otherwise provided herein, the terms and conditions of
this Agreement shall inure to the benefit of and be binding upon
the respective successors and assigns of the parties. Nothing in
this Agreement, express or implied, is intended to confer upon
any party other than the parties hereto or their respective
successors and assigns, any rights, obligations, or liabilities
under or by reason of this Agreement, except as expressly
provided in this Agreement.
8.3. Settlement of Disputes; Arbitration; Governing Law, Equitable
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Remedies
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(a) In the event of an occurrence of any dispute of
disagreement, the Parties shall first exert their best
efforts in good faith to resolve the matter amicably between
themselves as provided for in this Section. Within 3 days
after written demand by either party, the Parties shall each
designate a representative from among those personnel
acquainted with the work involved who
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shall discuss and attempt to resolve the dispute or
disagreement at the offices of the Buyer in
Sunnyvale, California, or such other place agreeable to the
Parties. If a resolution has not been reached within 10 days
from the date on which the written demand for such working-
level discussions was originally made, then the Parties may
go to binding arbitration, to the American Arbitration
Association. The award of such arbitration shall be binding
upon the parties.
(Two) It is agreed that the substantive law governing this
Agreement will be the law of the State of California and any
disputes resolved in arbitration will be governed as such.
(Three) Each of the parties hereto acknowledges and agrees
that, because the legal remedies of the other party may be
inadequate in the event of a breach of, or other failure to
perform, any of the covenants and obligations set forth in
section 4.5 or Article 6 hereof, any such other party may, in
addition to obtaining any other remedy or relief available to it
(including, without limitation, consequential and other damages
at law), enforce Section 4.5 or Article 6 hereof by injunction,
specific performance and other equitable remedies.
8.4. Counterparts
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This Agreement may be executed in two or more counterparts, each
of which shall be deemed an original, but all of which together
shall constitute one and the same instrument.
8.5. Titles, Subtitles, Preamble and Appendices
------------------------------------------
The titles and subtitles used in this Agreement are used for
convenience only and are not to be considered in interpreting this
Agreement. The Preamble and Appendices are an integral and
inseparable part of this Agreement.
8.6. Notices
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Unless otherwise provided, any notice required or permitted under
this Agreement with respect to parties shall be given in writing
and shall be deemed effectively given upon personal delivery to
the party to be notified or fourteen (14) business days after
deposit with a National Post Office, for dispatch by registered or
certified mail, postage prepaid and addressed to the party to be
notified at the address set forth in this
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For Xxxxx: For the Buyer:
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Xxxxx Software Mercury Interactive Corp.
X.X.Xxx 556 470 Potrero Avenue
Main Street Sunnyvale, California 94086
Charlestown U.S.A.
Nevis Attention: Chief Financial Officer
Island of Nevis 000-000-0000 000-000-0000
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Telephone / Fax
or at such other address as such party may designate by written
notice to the other parties; if by facsimile transmission within
48 hours of receipt; in the case of an internationally recognized
overnight courier, on the next business day after the date when
sent. Any party may change its address for purposes of this
paragraph by giving notice of the new address to each of the other
parties in the manner set forth above.
8.7. Expenses
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Irrespective of whether the Closing is effected, the Buyer to this
Agreement shall bear costs and expenses with respect to the
negotiation, execution, delivery and performance of this
Agreement.
8.8. Assignment
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This Agreement may not be assigned to third parties.
8.9. Entire Agreement, Amendments and Waivers
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This Agreement and the appendices hereto constitute the entire
agreement between the parties pertaining to the agreements,
representations, warranties, covenants and understandings of the
parties. No supplement, modification, or amendment of this
Agreement shall be binding unless executed in writing by all the
parties. Any term of this Agreement may be amended and the
observance of any term of this Agreement may be waived (either
generally or in a particular instance and either retroactively or
prospectively), only with the written consent of all the parties
hereto. No waiver of any of the provisions of this Agreement shall
be deemed, or shall constitute a waiver of any other provision,
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whether or not similar, nor shall any waiver constitute a
continuing waiver.
8.10. Severability
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Should any provision of this Agreement be determined to be
invalid, it shall be severed from this Agreement and the remaining
provisions shall remain in full force and effect.
8.11. Parties in Interest
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Nothing in this Agreement, express or implied, is intended to
confer any rights or remedies under or by reason of this Agreement
on any persons other than the parties to it and their respective
and permitted successors and assigns, nor is anything in this
Agreement intended to relieve or discharge the obligation or
liability of any third persons to any party to this Agreement, nor
shall any provision give any third persons any right of
subrogation or action over against any party to this Agreement.
8.12. Advice of Legal Counsel
-----------------------
Each party to this Agreement acknowledges and represents that it
has been represented by legal counsel in connection with the
transactions contemplated by this Agreement, with the opportunity
to seek advice as to its legal rights from such counsel. Each
party further represents that it has been independently advised as
to the tax consequences of the transactions contemplated by this
Agreement and is not relying on any representations or statements
made by any other party as to such consequences.
8.13. Force Majeure
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Neither party shall be held liable for failure to fulfill its
obligations under this agreement, if such failure is caused by
flood, extreme weather, fire, or other natural calamity, acts of
government agency, or similar causes beyond the control of such
party.
IN ATTESTING THERETO, THE PARTIES BELOW STATE THAT THEY ARE PROPERLY EMPOWERED
AND AUTHORIZED BY THEIR RESPECTIVE ENTITIES AND/OR AS INDIVIDUALS, TO EXECUTE
THIS AGREEMENT AND HAVE SIGNED THIS AGREEMENT AS OF THE DATE SO INDICATED.
____________________ ____________________
Xxxxx Date The Buyer Date
By:_________________ By:_________________
Title: _____________ Title:_________________
