waived, except for Purchaser's delivery obligation pursuant to Section 5(a)(i),
Purchaser shall have the right to extend the Closing Date to May 31, 1998 by
paying to Company, pursuant to and in accordance with the holdback provisions of
Section 15 below, on or before April 30, 1998, One Million Dollars ($1,000,000)
(the "Third Prepayment") by certified or cashiers bank check or wire transfer.
The First Prepayment, the Second Prepayment (if any) and the Third Prepayment
(if any) are sometimes hereinafter collectively referred to as the
"Prepayments." The day on which the Closing actually takes place is herein
sometimes referred to as the "Closing Date."
(b) Further Action.
(i) The Company and Purchaser agree to use all reasonable good faith
efforts to take all actions and to do all things necessary, proper
or advisable to consummate the transactions contemplated hereby by
the Closing Date, including but not limited to (A) fulfilling the
provisions of Section 12 below, and (B) delivering all of the
Schedules required to be annexed to this Agreement; provided that a
Schedule shall not be deemed to have been delivered hereunder unless
and until same is complete and accurate in its entirety.
(ii) The Company and Purchaser shall, as promptly as practicable,
file or supply, or cause to be filed or supplied, all applications,
notifications and information required to be filed or supplied
pursuant to all applicable provisions of (A) constitutions,
treaties, statutes, laws (including common law), rules, regulations,
ordinances, codes or orders of any Government Authority; and (B)
orders, decisions, injunctions, judgments, awards and decrees of or
agreements with any Governmental Authority (collectively, the
"Applicable Laws") in connection with this Agreement, the sale and
transfer of the Assets pursuant to this Agreement and the
consummation of the other transactions contemplated hereby.
(iii) The Company and Purchaser, as promptly as practicable, will
use all reasonable efforts to obtain, or cause to be obtained, all
consents of any Governmental Authority and of any third party
(collectively, the "Consents") necessary to be obtained in order to
consummate the sale and transfer of the Assets pursuant to this
Agreement and the consummation of the other transactions
contemplated hereby.
(iv) The Company shall coordinate and cooperate with Purchaser in
exchanging such information and supplying such assistance as may be
reasonably required
10
by Purchaser pursuant to Applicable Laws in connection with this
Agreement and the "Company's Related Agreements" (as that term is
defined in Section 6(d) below).
(v) At all times prior to the Closing, the Company shall promptly
notify Purchaser in writing, and the Purchaser shall promptly notify
the Company in writing, upon becoming aware of any fact, condition,
event or occurrence that will or may result in the failure to
satisfy any of the conditions precedent to the transactions
contemplated by this Agreement as set forth in Section 14 hereof.
(vi) The Company shall use its good faith, reasonable efforts to
enter into such agreements and other arrangements (including
sublicenses and subleases) with Purchaser as are necessary to ensure
that Purchaser receives benefits under the Contracts set forth on
Schedule 6(z) annexed hereto and the other agreements to be
transferred to Purchaser hereunder that are the same as received
under the Contracts prior to the Closing or as contemplated to be
received after the Closing.
4. (a) The Company's Delivery Obligations at the Closing; Covenants;
Further Assurances. At the Closing, the Company agrees to deliver or cause to be
delivered to Purchaser (and, as applicable, execute):
(i) a Bill of Sale in English and a Bill of Sale in Italian, each of
which shall be duly executed by the Company in substantially the
form of Schedule 4(a).1 and Schedule 4(a).2, respectively, annexed
hereto;
(ii) such other good and sufficient deeds, bills of sale,
endorsements, assignments, documents of title and other instruments
of conveyance, assignment and transfer, in form and substance
reasonably satisfactory to Purchaser's counsel, as shall be
effective to vest in Purchaser good title to the Assets;
(iii) all contracts, files and other data (including, without
limitation, lists of orders and computer disks and tapes) and
documents pertaining to the Assets;
(iv) certified copies of resolutions adopted by the Company's Board
of Directors authorizing the execution, delivery and performance of
this Agreement;
11
(v) an authenticated copy of the Subsidiary's Certificate of
Incorporation, as amended, certified by the Office of the Secretary
of State of the State of Delaware, and a true and correct copy of
the by-laws of the Subsidiary as certified by the secretary of the
Subsidiary;
(vi) the opinion of Company's counsel, substantially in the form of
Schedule 4(a)(vi) annexed hereto which opinion shall cover, among
other things, the due authorization, execution and delivery of this
Agreement and the transactions contemplated hereby;
(vii) the Non-Competition Undertaking of Mr. Flavio Peralda, which
shall include, among other things, a provision prohibiting any
further use, directly or indirectly, of the names and words
"Vidikron Industries S.p.A." or Vidikron of America, Inc.," or any
other name confusingly similar to such names and marks or any
variation thereof (the "Peralda Non-Competition Undertaking"), in
the form of Schedule 4(a)(vii) annexed hereto;
(viii) the Employment Agreement (the "Peralda Employment Agreement")
between Purchaser and Mr. Flavio Peralda in the form of Schedule
4(a)(viii) annexed hereto;
(ix) the Employment Agreement (the "Macario Employment Agreement"),
which shall include, among other things, a provision prohibiting any
further use, directly or indirectly, of the names and words
"Vidikron Industries S.p.A." or Vidikron of America, Inc.," or any
other name confusingly similar to such names and marks or any
variation thereof, between Purchaser and Mr. Emilio Baj Macario in
the form of Schedule 4(a)(ix) annexed hereto;
(x) the Non-Competition Undertaking of Mr. Emilio Baj Macario, which
shall include, among other things, a provision prohibiting any
further use, directly or indirectly, of the names and words
"Vidikron Industries S.p.A." or Vidikron of America, Inc.," or any
other name confusingly similar to such names and marks or any
variation thereof (the "Macario Non-Competition Undertaking") in the
form of Schedule 4(a)(x) annexed hereto;
(xi) approvals, if required by the terms thereof, in respect of and
an assignment and assumption agreement for the Leases (as defined in
Section 6(dd)
12
hereof) in substantially the form of Schedule 4(a)(xi) annexed
hereto (the "Lease Assignment");
(xii) an assignment and assumption agreement for the equipment
leases in substantially the form of Schedule 4(a)(xii) annexed
hereto to be prepared by Purchaser (the "Personal Property
Assignment);" provided, however, Purchaser expressly agrees that in
the event that any Personal Property Assignment cannot be executed
and delivered at the Closing, it shall be acceptable for the
Company, in lieu thereof, to keep in existence the applicable
equipment lease for the benefit of Purchaser and the Purchaser shall
reimburse the Company on a timely basis for any ongoing lease
payments from time to time as same become due and owing;
(xiii) a notarized assignment agreement for the Intellectual
Property to be included in each of the Bills of Sale referred to in
Section 4(a)(i) above, in accordance with applicable laws and in
substantially the form of Schedule 4(a)(xiii) annexed hereto (the
"Intellectual Property Assignment");
(xiv) all Consents, including, without limitation, those necessary
in connection with the Lease Assignment, if required, the Personal
Property Assignment and the Intellectual Property Assignment;
(xv) a Certificate of the Registry of the Companies which shall
cover the Company's continued registration in the Registry of
Companies as of the Closing Date;
(xvi) a Certificate signed by a managing director of the Company
dated the Closing Date, reaffirming that all of the representations
and warranties set forth in Section 6 below;
(xvii) the lease with the Purchaser for the premises at the
Company's address first set forth above (the "Italian Lease") for a
term of not less than six (6) years at a rate of 140,000,000Li. per
annum (plus normal operating expenses and value added taxes, if any,
all consistent with the terms and conditions as are applicable to
the Italian Lease upon the execution hereof);
(xviii) the "Financial Holdback Escrow Agreement" and the "Other
Holdback Escrow Agreement" as those terms are defined in Section
16(a) below and the "Earn Out Escrow Agreement" as that term is
defined in Section 19
13
below, and the "Trade Payables Escrow Agreement" as that term is
defined in Section 18 below;
(xix) Governmental Approvals;
(xx) the original stock certificate(s) representing the Company's
eighty-five percent (85%) beneficial equity ownership interest in
the Subsidiary, accompanied by undated stock powers executed in
blank with signatures guaranteed;
(xxi) all of the books and records, stock ledger, bank accounts,
agreements, contracts, understandings, correspondence, and all other
materials of any nature whatsoever relative to the Subsidiary;
(xxii) evidence in form and substance satisfactory to Purchaser that
all notices required to be given to the Company's employees pursuant
to Italian laws have been properly given in a timely fashion in
accordance with applicable Italian Laws; and
(xxiii) all other documents and instruments required to be delivered
to Purchaser in order to consummate the transactions herein
contemplated.
(b) Billings. The Company agrees that from and after the Closing
Date, Purchaser shall have the right and authority to bill and collect for its
own account all billings in respect of work-in-process, if any, that are being
transferred to Purchaser as provided herein. The Company agrees that it will
promptly transfer and deliver to Purchaser any cash or other property which the
Company may receive in respect of such billings.
(c) Liability for Transfer Taxes. Except for the Bill of Sale
Registration Tax and Stamp Tax Duties, the Company shall be responsible for the
payment in the ordinary course of, and shall indemnify and hold harmless
Purchaser against, all income, sales (including, without limitation, bulk
sales), use, value added, documentary, stamp, gross receipts, transfer,
conveyance, excise (if any), license and other similar Taxes (as defined in
Section 6(i) hereof) and fees (collectively, "Transfer Taxes"), arising out of
or in connection with or attributable to the transactions effected pursuant to
this Agreement and the Company's Related Agreements. The Company shall prepare
and timely file all tax returns required to be filed in respect of Transfer
Taxes (including, without limitation, all notices required to be given with
respect to bulk sales taxes), provided that Purchaser shall be permitted to
prepare any such tax returns that are the primary responsibility of Purchaser
under Applicable Law. Purchaser's preparation of any such tax returns shall be
14
subject to the Company's approval, which approval shall not be unreasonably
withheld or delayed.
(d) Certificates of Tax Affidavits. On or before the Closing Date,
Purchaser shall obtain copies of certificates from appropriate taxing
authorities with respect to value added taxes relative to any country, federal,
state, regional, provincial or other taxing authority for which Purchaser or the
Company could have liability to withhold or pay with respect to the transfer of
the Assets or any of the transactions herein contemplated, provided, that
Purchaser's failure to obtain such certificates (provided that such failure
shall not be the fault of the Company) shall not relieve the Purchaser of its
obligations to enter into and complete the Closing. In the event that
notwithstanding its good faith efforts to the contrary, Purchaser is unable to
obtain such certificates prior to the Closing, Purchaser shall withhold or,
where appropriate, escrow such amount as necessary based upon the Purchaser's
reasonable estimate of the amount of such potential liability, or as determined
by the appropriate taxing authority, to cover such value added taxes until such
time as certificates are provided.
(e) Use of Business Name. Contemporaneously with the Closing, the
Company will change its name, and the Company will not, directly or indirectly,
use or do business, or allow any Affiliate (as hereinafter defined) to use or do
business, or assist any third party in using or doing business, under the names
and marks "Vidikron Industries S.p.A." or "Vidikron of America, Inc.," or any
other name confusingly similar to such names and marks or any variation thereof.
It is expressly acknowledged and agreed by the Company that the provisions of
this Section 4(e) are of the essence hereof.
(f) Further Assurances. At any time and from time to time after the
Closing, at Purchaser's request and expense, without further consideration, the
Company shall execute and deliver such other additional instruments of sale,
transfer, conveyance, assignment and confirmation and take such other action as
Purchaser may reasonably deem necessary or desirable in order to transfer,
convey and assign to Purchaser the Assets, subject to this Agreement, to put
Purchaser in actual possession and operating control thereof and to assist
Purchaser in exercising all of the Company's rights with respect thereto and to
take such action and execute such documents or instruments as may be reasonably
requested by the Purchaser in connection with any governmental or regulatory
matters or filings required to be made by Purchaser, including, without
limitation, any filings, documents or instruments to be delivered to the United
States Securities and Exchange Commission or any other Governmental Authority,
The Nasdaq Stock Market, Purchaser's, the Company's and the Subsidiary's,
lenders, auditors or any other appropriate party. |
