ASSETS PURCHASE AGREEMENT
ASSETS PURCHASE AGREEMENT, dated as of July 2, 1999 by and between
COMPU-▇▇▇▇, INC., a Delaware corporation ("Seller"), having its principal place
of business at ▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇ and ADMIT COMPUTER
SERVICES, INC. a New York corporation ("Purchaser"), having its principal place
of business at ▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇.
WHEREAS, Seller is engaged, in part, in the business of designing,
developing, licensing, installing and servicing computer software products and
systems predominantly for public safety and law enforcement agencies; and
WHEREAS, Purchaser is engaged, in part, in the business of designing,
developing, licensing, installing and servicing computer software for public
safety and municipal government agencies, and desires to purchase all of the
above-described Public Safety Software Business assets of Seller (as hereinafter
defined); and
WHEREAS, subject only to the limitations and exclusions contained in this
Agreement and on the terms and conditions hereinafter set forth, Seller desires
to sell and Purchaser desires to purchase the Public Safety Software Business
and the assets of Seller used therein.
NOW, THEREFORE, in consideration of the premises and of the respective
covenants, representations, warranties and agreements herein contained for other
good and valuable consideration receipt of which is hereby acknowledged, and
intending to be legally bound hereby, the parties hereto hereby agree as
follows:
1
ARTICLE I - PURCHASE AND SALE
1.1 Agreement to Sell. Seller hereby grants, sells, conveys, assigns,
transfers and delivers to Purchaser, upon and subject to the terms and
conditions of this Agreement, all right, title and interest of Seller in
and to: (a) all assets, rights and properties, tangible and intangible, of
Seller's Public Safety Software Business (excluding cash and cash
equivalents) wherever situated used or usable in connection with the
design, development, licensing, installation and servicing computer
application software systems for law enforcement and public safety
agencies, including, without limitation, computer-aided dispatching ("CAD"
and "V-CAD"), computer interfacing with local, state and national crime
information databases, advanced wireless mobile on-line communications
computing ("AMO"), automatic vehicle location ("AVL"), records management,
and photo-imaging database systems, the foregoing systems marketed under
product lines 'ALECS I", "ALECS II", "ALECS 2000", "AFFECT", "PISTOL",
"AVL", "AMO", "CAD", "V-CAD" and "ARMS" (the "Public Safety Software
Business"), all as more particularly described in the Seller's Annual
Report on Form 10-KSB dated March 31, 1999 as filed with the Securities and
Exchange Commission; (b) the names "ALECS I", "ALECS II", "ALECS 2000",
"AFFECT", "PISTOL", "AVL", "AMO", "CAD", "V-CAD", "ARMS" and "Compu-▇▇▇▇"
(except that Compu-▇▇▇▇ has the right to use the name Compu-▇▇▇▇ for
corporate purposes, but not with respect to products or services which
compete directly or indirectly with the Public Safety Software Business,
until Compu-▇▇▇▇ changes its name as required in the Agreement) and all
goodwill associated therewith; and (c) the Business as a going concern
(which Public Safety Software Business, names, goodwill, assets, properties
and rights are herein sometimes called the "Assets"), free and clear of all
mortgages, liens, pledges, security interests, charges, claims,
restrictions and encumbrances of any nature whatsoever except Permitted
Liens as defined in Section 3.1.13 hereof.
1.1.1 Included Assets. The Assets shall include without
limitation the following assets, properties and rights of Seller used
directly or indirectly in the conduct of, or generated by or
constituting, the Public Safety Software Business, except as otherwise
expressly set forth in Section 1.1.2 hereof:
(a) trade marks, trade names, patents, inventions, designs,
drawings, specifications, object and source codes, know how and
technical information, software to the extent owned by Seller,
and all copyright and all other intellectual property rights used
or usable in the Public Safety Software Business or under
development;
(b) the exclusive right for Purchaser to represent itself as
carrying on the Public Safety Software Business in succession to
Seller;
(c) all contract rights, including all outstanding orders,
work, work-in-progress and maintenance/support work together with
all fees payable thereon and licenses to use third party owned
software used by Seller in the development of the products;
2
(d) all accounts receivables as the date hereof ;
(e) all literature, inventory and supplies on hand and on
order;
(f) certain computer hardware (including development server,
communications server, certain personal computers, demonstration
equipment) described on Schedule 1.1.1(f) annexed hereto;
(g) all rights under any patent, trademark, service ▇▇▇▇,
trade name or copyright, whether registered or unregistered, and
any applications therefor;
(h) trade show displays on hand or on order;
(i) lists of customers, suppliers and accounting and other
records;
(j) all rights or choses in actions arising out of
occurrences before or after the Closing, including without
limitation all rights under express or implied warranties
relating to the Assets;
(k) all information, files, records, data, plans, contracts
and recorded knowledge related to the foregoing.
1.1.2 Notwithstanding the foregoing, the Assets shall not include
any of the following:
(a) all cash or cash equivalents of the Seller in hand or in
bank accounts at the Closing and all marketable securities;
(b) loans receivable;
(c) the corporate seals, certificates of incorporation,
minute books, stock books, tax returns, books of account or other
records having to do with corporate organization of Seller;
(d) the rights which accrue or will accrue to Seller under
this Agreement;
(e) the rights to any of Seller's claims for any federal,
state, local, or foreign tax refunds; or
3
(f) the assets, properties or rights of Seller in and to its
business carried on under the name "▇.▇▇ Commerce, Inc.".
1.2 Agreement to Purchase. Purchaser hereby purchases the Assets from
Seller, upon and subject to the terms and conditions of this Agreement and
in reliance on the representations, warranties and covenants of Seller
contained herein, in exchange for the Purchase Price (hereinafter defined
in Section 1.3 hereof). Except as specifically provided in section 1.4
hereof, Purchaser shall not assume or be responsible for any liabilities or
obligations of the Business or Seller.
1.3 The Purchase Price.
1.3.1 Purchase Price. The Purchase Price shall be the following:
(a) The sum of Five Hundred Thousand ($500,000) Dollars.
Seller and Purchaser acknowledge that Purchaser has heretofore
paid Fifty Thousand ($50,000) Dollars (the "Downpayment") of said
Purchase Price that is on deposit with Seller's attorneys (the
"Escrow Agent") which sum shall be delivered to Seller by the
Escrow Agent pursuant to the terms of the Escrow Agreement upon
consummation of the Closing; and
(b) Purchaser shall pay Seller a royalty in the manner
provided for in Section 8.1 as follows:
(i) Ten (10%) percent of the amount actually received
by Purchaser (excluding sales tax, if any) from present
customers of Seller during the five-year period after the
date of the Closing (the "Post Closing Five-Year Period")
who are identified in Schedule 1.3.1 (b)(i) annexed hereto
from (a) new sales or licensing orders placed during the
Post Closing Five-Year Period of the following (i) Seller's
Public Safety Software Systems; and (ii) Purchaser's Impact
public safety software products and/or consulting services
relating to public safety software, and (b) maintenance
services provided.
(ii) Ten (10%) percent of the amount actually received
by Purchaser (excluding sales tax, if any) from sales or
licensing orders placed during such Post Closing Five-Year
4
Period of any of Seller's Public Safety Software
Systems and modules thereof to any customer together with
the maintenance fees allocable to said product of Seller for
services provided during the Post Closing Five-Year Period.
(iii) Six and one-quarter (6.25%) percent of the amount
actually received by Purchaser (excluding sales tax, if any)
from any customer who purchases or licenses during the Post
Closing Five-Year Period a public safety software system
which is the result of a redesigned software system
combining in one system elements of Seller intellectual
property and Purchaser intellectual property.
Seller and Purchaser agree that the royalties provided for in this Section
1.3 shall apply to amounts actually received by Purchaser after the expiration
of the Post Closing Five-Year Period in respect of new sales or licensing orders
that were firm orders during the Post Closing Five-Year Period.
1.3.2 Payment of Purchase Price. (a) On the Closing Date
Purchaser shall pay (i) to Seller, on account of the Purchase
Price, the amount of $450,000 (the "Seller Closing Payment")
payable by certified or bank cashier's check or by wire transfer
of immediately available funds to Seller , and (ii) the Purchaser
and Seller shall cause the Escrow Agent to remit the Downpayment
to Seller.
(b) Purchaser shall make Royalty Payments to Seller in
accordance with Section 8.1 hereof.
1.3.3 Allocation of Purchase Price. The Purchase Price and
the liabilities assumed by Purchaser in accordance with Section
1.4 hereof (together, the "Total Consideration") as finally
determined shall be allocated among the Assets acquired hereunder
as described on Schedule 1.3.3 hereof. Seller and Purchaser each
hereby covenant and agree that it will not take a position on any
income tax return, before any governmental agency charged with
the collection of any income tax, or in any judicial proceeding
that is in any way inconsistent with the terms of this Section
1.3.3.
1.4 Purchaser hereby assumes only the obligations of Seller set
forth in contracts listed in Schedule 1.4 annexed hereto to be
performed on or after the date hereof (the "Assumed Liabilities"),
including, without
5
limitation, to install, service and maintain software systems
specified in such assumed contracts. Purchaser shall not assume or
agree to pay, discharge or perform any:
(i) accounts, loans, notes and other payables and all
liabilities of whatsoever character existing as of the
Closing Date; or
(ii) liabilities or obligations arising out of any
breach by Seller of any provision of any agreement,
contract, commitment or license, including but not limited
to liabilities or obligations arising out of Seller's
failure to perform any agreement, contract, commitment or
license in accordance with its terms prior to the Closing,
but excluding however any liability arising out of the
assignment to Purchaser of such agreements, contracts,
commitments or leases in violation of the terms thereof to
the extent that the agreement, contract, commitment or lease
is listed on Schedule 1.4 annexed hereto.
(iii) any product liability or similar claim for injury
to person or property, regardless of when made or asserted,
which arises out of or is based upon any express or implied
representation, warranty, agreement or guarantee made by
Seller, or alleged to have been made by Seller, or which is
imposed or asserted to be imposed by operation of law, in
connection with any service performed or product sold or
licensed by or on behalf of Seller on or prior to the
Closing, including without limitation any claim relating to
any product delivered in connection with the performance of
such service and any claim seeking recovery for
consequential damage, lost revenue or income;
(iv) any federal, state or local income or other tax
(a) payable with respect to the business, assets, properties
or operations of Seller or any member of any affiliated
group of which Seller is a member for any period prior to
the Closing Date, or (b) incident to or arising as a
consequence of the negotiation or consummation by Seller or
any member of any affiliated group of which either is a
member of this Agreement and the transactions contemplated
hereby;
(v) any liability or obligation under or in connection
with the assets excluded from the Assets under Section
1.1.2;
(vi) any liability or obligation arising prior to or as
a result of the Closing to any employees, agents or
independent contractors of Seller, whether or not employed
by Purchaser after the Closing, or under any benefit
arrangement with respect thereto; or
6
(vii) any liability or obligation of Seller arising or
incurred in connection with the negotiation, preparation and
execution of this Agreement and the transactions
contemplated hereby and fees and expenses of counsel,
accountants and other experts.
7
ARTICLE II - CLOSING, ITEMS TO BE DELIVERED, THIRD PARTY
CONSENTS, CHANGE IN NAME AND FURTHER ASSURANCES
2.1 The closing (the "Closing") of the sale and purchase of the Assets
shall take place at 10:00 A.M., on the date the date hereof at the offices
of Certilman Balin ▇▇▇▇▇ & ▇▇▇▇▇, LLP, The Financial Center, ▇▇ ▇▇▇▇▇▇▇
▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇. The date of the agreed Closing is
sometimes herein referred to as the "Closing Date".
2.2 Items to be Delivered at Closing. At the Closing and subject to
the terms and conditions herein contained:
(a) Seller shall deliver to Purchaser the following:
(i) such bills of sale with covenants of warranty,
assignments, endorsements, and other good and sufficient
instruments and documents of conveyance and transfer, in form
reasonably satisfactory to Purchaser and its counsel, as shall be
necessary and effective to transfer and assign to, and vest in,
Purchaser all of Seller's right, title and interest in and to the
Assets, including without limitation, (A) good and valid title in
and to all of the Assets owned by Seller, (B) all of Seller's
rights under all agreements, contracts, commitments, licenses,
proposals, and other documents included in the Assets to which
Seller is a party or by which it has rights on the Closing Date;
and
(ii) all of the agreements, contracts, commitments,
licenses, plans, bids, quotations, proposals, instruments,
computer programs and software, data bases whether in the form of
computer tapes or otherwise, related object and source codes,
manuals and guidebooks, price books and price lists, customer and
subscriber lists, supplier lists, sales records, files,
correspondences, legal opinions, rulings issued by governmental
entities, and other documents, books, records, papers, files,
office supplies and data belonging to Seller which are part of
the Assets;
and simultaneously with such delivery, all such steps will be taken as may be
required to put Purchaser in actual possession and operating control of the
Assets.
(b) Purchaser shall deliver to Seller the following:
(i) the Seller Closing Payment in accordance with Section
1.3.2 hereof;
(ii) an undertaking whereby Purchaser will assume and agree
to pay, discharge or perform, as appropriate, Seller's
liabilities and obligations to the extent and as provided in
Section 1.4 hereof in form reasonably satisfactory to Seller and
its counsel;
8
(iii) a security agreement granting the Seller a security
interest in the Assets in forms reasonably satisfactory to Seller
and subordinate to the first priority security interest of
Purchaser's lender, State Bank of Long Island;
(c) Purchaser shall direct the Escrow Agent to deliver the
Downpayment to Seller as provided in Section 1.3.2 (ii) hereof.
(d) The items in Article V hereof have been delivered.
2.3 Third Party Consents. To the extent that Seller's rights under any
agreement, contract, commitment, license, Authorization (as defined in
Section 3.1.15) or other Asset to be assigned to Purchaser hereunder may
not be assigned without the consent of another person which has not been
obtained, this Agreement shall not constitute an agreement to assign the
same if an attempted assignment would constitute a breach thereof or be
unlawful, and Seller, at its expense, shall use its best efforts to obtain
any such required consent(s) as promptly as possible. If any such consent
shall not be obtained or if any attempted assignment would be ineffective
or would impair Purchaser's rights under the Asset in question so that
Purchaser would not in effect acquire the benefit of all such rights,
Seller, to the maximum extent permitted by law and the Asset, shall act
after the Closing as Purchaser's agent in order to obtain for it the
benefits thereunder and shall cooperate, to the maximum extent permitted by
law and the Asset, with Purchaser in any other reasonable arrangement
designed to provide such benefits to Purchaser.
2.4 Change in Name. On or before December 31,1999, Seller shall
convene a meeting of its stockholders at which the Seller will present to
its stockholders for approval, among any other things, the amendment to
Seller's Certificate of Incorporation to change Seller's name to another
name bearing no similarity to "Compu-▇▇▇▇" and the Seller shall cause its
Board of Directors to recommend such name change to its stockholders and if
such name change is approved, the Seller shall promptly thereafter file an
Amendment to Seller's Certificate of Incorporation effectuating such name
change (the "Name Change Amendment") with the Secretary of State of
Delaware and an appropriate name change notice for each state where Seller
is qualified to do business. Seller hereby appoints Purchaser as its
attorney-in-fact effective upon the filing of the Name Change Amendment by
the Seller to file all such State name change notices on or after the
Closing Date.
2.5 Further Assurances. Seller from time to time after the Closing, at
Purchaser's request, will execute, acknowledge and deliver to Purchaser
such other instruments of conveyance and transfer and will take such other
actions and execute and deliver such other documents, certifications and
further assurances as Purchaser may reasonably require in order to vest
more effectively in Purchaser, or to put Purchaser more fully in possession
of, any of the Assets, or to better enable Purchaser to complete, perform
or discharge any of the liabilities or obligations assumed by Purchaser at
the Closing pursuant to Section 1.4 hereof. Each of the parties hereto will
cooperate with the other and execute and deliver to the other parties
hereto such other instruments and documents and take such other actions as
may be reasonably
9
requested from time to time by any other party as necessary to carry out or
evidence the intended purposes of this Agreement.
10
ARTICLE III - REPRESENTATIONS AND WARRANTIES
3.1 Representations and Warranties of the Seller. The Seller hereby
represents and warrants to Purchaser as:
3.1.1 Corporate Existence. Seller is a corporation duly
organized, validly existing and in good standing under the laws of the
jurisdiction of its incorporation. Seller is duly qualified to do
business and is in good standing as a foreign corporation in each
jurisdiction where the conduct of the Public Safety Software Business
by it requires it to be so qualified, all of which jurisdictions are
listed on Schedule 3.1.1 annexed hereto.
3.1.2 Corporate Power; Authorization; Enforceable Obligations.
Seller has the corporate power, authority and legal right to execute,
deliver and perform this Agreement. The execution, delivery and
performance of this Agreement by Seller has been duly authorized by
all necessary corporate action. This Agreement has been, and the other
agreements, documents and instruments required to be delivered by
Seller in accordance with the provisions hereof (the "Seller's
Documents") will be, duly executed and delivered on behalf of Seller
by duly authorized officers or agents (including without limitation
▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇) of Seller, and this Agreement constitutes, and the
Seller's Documents when executed and delivered will constitute, the
legal, valid and binding obligations of Seller enforceable in
accordance with their respective terms.
3.1.3 No Interest in Other Entities. No shares of any corporation
or any ownership or other investment interest, either of record,
beneficially or equitably, in any association, partnership, joint
venture or other legal entity are included in the Assets.
3.1.4 Validity of Contemplated Transactions, etc. The execution,
delivery and performance of this Agreement by Seller does not and will
not violate, conflict with or result in the breach of any term,
condition or provision of, or require the consent of any other person
under, (a) any existing law, ordinance, or governmental rule or
regulation to which Seller is subject, (b) any judgment, order, writ,
injunction, decree or award of any court, arbitrator or governmental
or regulatory official, body or authority which is applicable to
Seller, (c) the charter documents of Seller or any securities issued
by Seller, or (d) any mortgage, indenture, agreement, contract,
commitment, lease, plan, Authorization (hereinafter defined in Section
3.1.15), or other instrument, document or understanding, oral or
written, to which Seller is a party, by which Seller may have rights
or by which any of the Assets may be bound or affected, or give any
party with rights thereunder the right to terminate, modify,
accelerate or otherwise change the existing rights or obligations of
Seller thereunder, except as set forth on Schedule 3.1.4 annexed
hereto. No authorization, approval or consent of, and no registration
or filing with, any governmental or regulatory official, body or
authority is required in connection with the execution, delivery or
performance of this Agreement by Seller.
11
3.1.5 No Third Party Options. There are no existing agreements,
options, commitments or rights with, of or to any person to acquire
any of Seller's assets, properties or rights included in the Assets or
any interest therein, except for those contracts entered into in the
normal course of business consistent with past practice for the sale
of inventory of Seller.
3.1.6 Financial Statements. Seller has delivered to Purchaser
true and complete copies of the Seller's Annual Report on Form 10- KSB
for the year ended December 31, 1998, the "Form 10-KSB" as filed with
the Securities and Exchange Commission and containing therein the
balance sheet of Seller at December 31, 1998 and December 31, 1997 and
the related statements of operations, cash flow and statement of
shareholders equity for the fiscal years then ended, certified by
Seller's Auditors (the Audited Financial Statement") and the Seller's
Quarterly Report on Form 10-QSB for the three month's ended March 31,
1999 as filed with the Securities and Exchange Commission containing
therein the balance sheet of Seller at March 31, 1999 (the "Balance
Sheet") and March 31, 1998 and the related consolidated condensed
statements of operations and cash flows (together with the Audited
Financial Statements, the "Financial Statements") for the three months
then ended, together with current reports on Form 8K for events dated
May 11, 1999 and June 9, 1999 respectively referred to as the "SEC
Reports"). Such financial statements, including the related notes,
fairly present the financial position, assets and liabilities (whether
accrued, absolute, contingent or otherwise) of Seller at the dates
indicated and such statements fairly present the results of
operations, cash flow and changes in shareholders equity of Seller for
the periods indicated.
3.1.7 Accounts Receivable. The accounts receivable of Seller
arising from the Public Safety Software Business as set forth on the
Balance Sheet or arising since the date thereof are valid and genuine;
have arisen solely out of bona fide sales and deliveries of goods,
performance of services and other business transactions in the
ordinary course of business consistent with past practice; are not
subject to valid defenses, set-offs or counterclaims; and are
collectible within 90 days after billing at the full recorded amount
thereof less the recorded allowance for collection losses determined
in accordance with generally accepted accounting principles consistent
with-past practice, except as set forth on Schedule 3.1.7 annexed
hereto.
3.1.8 Inventory. Seller has no inventory.
3.1.9 Absence of Undisclosed Liabilities. Seller has no
liabilities or obligations with respect to the Public Safety Software
Business, either direct or indirect, matured or unmatured or absolute,
contingent or otherwise, except:
(a) liabilities and obligations detailed or set forth in the
Financial Statements, elsewhere in the SEC Reports, in this
Agreement or the Schedules annexed hereto;
12
(b) those accounts payable, notes, loans and other payables
and liabilities or obligations set forth in the Financial
Statements and the SEC Reports or Schedule 3.1.9 (b) annexed
hereto and not heretofore paid or discharged;
(c) liabilities arising in the ordinary course of business
under any agreement, contract, commitment, lease or plan unless
specifically disclosed on the Schedules annexed hereto or
disclosed in the SEC Reports; and
For purposes of this Agreement, the term "liabilities" shall include,
without limitation, any direct or indirect indebtedness, guaranty, endorsement,
claim, loss, damage, deficiency, cost, expense, obligation or responsibility,
fixed or unfixed, known or unknown, asserted or unasserted, ▇▇▇▇▇▇ or inchoate,
liquidated or unliquidated, secured or unsecured.
3.1.10 Tax and Other Returns and Reports. There are no tax liens
(other than any lien for current taxes not yet due and payable) on any
of the Assets. Seller has no knowledge of any basis for any additional
assessment of any federal, state, local or foreign taxes, assessments,
interest, penalties, deficiencies, fees and other governmental charges
or impositions, (including without limitation all income tax,
unemployment compensation, social security, payroll, sales and use,
excise, privilege, property, ad valorem, franchise, license, school
and any other tax or similar governmental charge or imposition under
laws of the United States or any state or municipal or political
subdivision thereof or any foreign country or political subdivision
thereof). Seller has made all deposits required by law to be made with
respect to employees' withholding and other employment taxes,
including without limitation the portion of such deposits relating to
taxes imposed upon Seller.
3.1.11 Books of Account. The books, records and accounts of
Seller maintained with respect to the Public Safety Software Business
accurately and fairly reflect, in reasonable detail, the transactions
and the assets and liabilities of Seller with respect to the Public
Safety Software Business. Seller has not engaged in any transaction
with respect to the Public Safety Software Business, maintained any
bank account for the Business or used any of the funds of Seller in
the conduct of the Public Safety Software Business except for
transactions, bank accounts and funds which have been and are
reflected in the normally maintained books and records of the
business, except those which will not have a material adverse effect
on the Assets.
3.1.12 Existing Condition. Except as set forth in the SEC
Reports, since the Balance Sheet Date, Seller with respect to the
Public Safety Software Business has not:
(a) incurred any liabilities, other than liabilities
incurred in the ordinary course of business consistent with past
practice, or discharged or satisfied any lien or encumbrance, or
paid any liabilities, other than in the ordinary course of
business consistent with past practice,
13
or failed to pay or discharge when due any liabilities of which
the failure to pay or discharge has caused or will cause any
material damage or risk of material loss to any of the Assets;
(b) sold, encumbered, assigned or transferred any assets or
properties which would have been included in the Assets if the
Closing had been held on the Balance Sheet Date or on any date
since then, except for the sale of inventory in the ordinary
course of business consistent with past practice;
(c) mortgaged, pledged or subjected any of its Assets to any
mortgage, lien, pledge, security interest, conditional sales
contract or other encumbrance of any nature whatsoever, except
for Permitted Liens (hereinafter defined in Section 3.1.13);
(d) made or suffered any amendment or termination of any
material agreement, contract, commitment, lease or plan to which
it is a party or by which it is bound, or cancelled, modified or
waived any substantial debts or claims held by it or waived any
rights of substantial value, whether or not in the ordinary
course of business included in the Assets or the liability
assumed by the Purchaser hereunder;
(e) [Intentionally left Blank];
(f) suffered any damage, destruction or loss, whether or not
covered by insurance, (i) materially and adversely affecting its
Public Safety Software Business, or the Assets or (ii) of any
item or items carried on its books of account individually or in
the aggregate at more than $25,000 related to the Public Safety
Software Business or the Assets or suffered any repeated,
recurring or prolonged shortage, cessation or interruption of
supplies or utility or other services required to conduct its
Public Safety Software Business;
(g) suffered any material adverse change in its Public
Safety Software Business, or the Assets, (financial or
otherwise);
(h) received notice or had knowledge of any actual or
threatened labor trouble, strike or other occurrence, event or
condition of any similar character which has had or might have an
adverse effect on its Public Safety Software Business or the
Assets;
(i) made commitments or agreements for capital expenditures
or capital additions or betterments
14
exceeding in the aggregate $50,000 in connection with the Public
Safety Software Business or the Assets except such as may be
involved in ordinary repair, maintenance or replacement of any
Assets;
(j) [Intentionally left Blank];
(k) changed any of the accounting principles followed by it
or the methods of applying such principles; or
(1) entered into any transaction other than in the ordinary
course of business consistent with past practice.
3.1.13 Title to Properties. Seller has good and valid title to
the Assets, real, personal and mixed, which it purports to own,
including without limitation all Assets reflected in the Balance Sheet
(except for inventory sold since the date thereof in the ordinary
course of business consistent with past practice) free and clear of
all mortgages, liens, pledges, security interests, charges, claims,
restrictions and other encumbrances and defects of title of any nature
whatsoever, except for (i) liens for current real or personal property
taxes not yet due and payable, and (ii) liens disclosed in Schedule
3.1.13 in response to this Section ("Permitted Liens").
3.1.14 Condition of Tangible Assets. All material items of
tangible Assets are in good operating condition and repair, subject to
normal wear and maintenance, are usable in the regular and ordinary
course of business and conform to all applicable laws, ordinances,
codes, rules and regulations, and Authorizations relating to their
construction, use and operation. No person other than Seller owns any
equipment or other tangible assets or properties situated on the
premises of Seller or necessary to the operation of the business of
Seller at ▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇, except for leased
items disclosed in Schedule 3.1.14 and for items of immaterial value.
3.1.15 Compliance with Law; Authorizations. Seller has complied
with each, and is not in violation of any, law, ordinance, or
governmental or regulatory rule or regulation, whether federal, state,
local or foreign, to which Seller's business, operations, assets or
properties is subject ("Regulations") the violation of which
Regulations would have a material adverse effect on the Public Safety
Software Business, the Assets or the Seller's ability to consummate
the transactions contemplated by this
15
Agreement. Seller owns, holds, possesses or lawfully uses in the
operation of its Public Safety Software Business all franchises,
licenses, permits, easements, rights, applications, filings,
registrations and other authorizations ("Authorizations") which are in
any manner necessary for it to conduct its Public Safety Software
Business as now or previously conducted or for the ownership and use
of the assets owned or used by Seller in the conduct of the Public
Safety Software Business of Seller, free and clear of all liens,
charges, restrictions and encumbrances and in compliance with all
Regulations. Seller is not in default, nor has it received any notice
of any claim of default, with respect to any such Authorizations. All
such 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
filing fees. None of such Authorizations will be adversely affected by
consummation of the transactions contemplated hereby. No shareholder,
director, officer, employee or former employee of Seller or any
affiliates of Seller, or any other person, firm or corporation owns or
has any proprietary, financial or other interest (direct or indirect)
in any Authorization which Seller owns, possesses or uses in the
operation of the business of Seller as now or previously conducted.
3.1.16 Transactions With Affiliates. No shareholder, director,
officer or employee of Seller, or any member of his or her immediate
family or any other of its, his or her affiliates, owns or has a 5% or
more ownership interest in any corporation or other entity that is or
was during the last three years a party to, or in any property which
is or was during the last three years the subject of, any material
contract, agreement or understanding, business arrangement or
relationship with Seller, except as set forth in the SEC Reports and
those which would not have a material adverse effect on the Public
Safety Software Business, the Assets or the ability of the Seller to
consummate the transactions contemplated by this Agreement.
3.1.17 Litigation. No litigation, including any arbitration,
investigation or other proceeding of or before any court, arbitrator
or governmental or regulatory official, body or authority is pending
or, to the best knowledge of Seller, threatened against Seller or
which relates to the Assets of Seller or the transactions contemplated
by this Agreement, nor does Seller know of any reasonably likely basis
for any such litigation, arbitration, investigation or proceeding, the
result of which could adversely affect the Public Safety Software
Business, its Assets or the transactions contemplated hereby. Seller
is not a party to or subject to the provisions of any judgment, order,
writ, injunction, decree or award of any court, arbitrator or
governmental or regulatory official, body or authority which may
adversely affect The Public Safety Software Business, its Assets or
the transactions contemplated hereby.
3.1.18 Insurance. The Assets and Public Safety Software Business,
properties and operations of Seller are insured under various policies
of general liability and other forms of insurance, all of which are
described in Schedule 3.1.18 annexed hereto, which discloses the risks
insured against, coverage limits, each policy deductible amounts, all
outstanding claims thereunder, and whether the terms of such policy
provide
16
for retrospective premium adjustments. All such policies are in full
force and effect in accordance with their terms, no notice of
cancellation has been received, and there is no existing event which,
with the giving of notice or lapse time or both, would constitute a
default thereunder. Such policies are in amounts which are adequate in
relation to the Public Safety Software Business and Assets of Seller
and all premiums to date have been paid in full. Seller has not been
refused any insurance, nor has its coverage been limited, by any
insurance carrier to which it has applied for insurance or with which
it has carried insurance during the past five years. Schedule 3.1.18
annexed hereto also contains a true and complete description of all
outstanding bonds and other surety arrangements issued or entered into
in connection with the Public Safety Software business the Assets and
the Assumed Liabilities of Seller.
3.1.19 Contracts and Commitments. Except as set forth in the SEC
Reports, and except to the extent that the following shall not have a
material adverse effect on the Public Safety Software Business, the
Assets, the Assumed Liabilities and the ability of Seller to
consummate the transactions contemplated by this Agreement, Seller is
not a party to any written or oral:
(a) agreement, contract or commitment with any present or
former employee or consultant or for the employment of any
person, including any consultant, who is engaged in the conduct
of the Public Safety Software Business;
(b) agreement, contract or commitment for the future
purchase of, or payment for, supplies or products, or for the
performance of services by a third party which supplies, products
or services are used in the conduct of the Public Safety Software
Business involving in any one case $5,000 or more;
(c) agreement, contract or commitment to sell or supply
products or to perform services in connection with the Public
Safety Software Business except as listed on Schedule3.1.19 (c)
annexed hereto;
(d) agreement, contract or commitment relating to the Public
Safety Software Business not otherwise listed on the Disclosure
Schedule and continuing over a period of more than six months
from the date hereof or exceeding $5,000 in value;
(e) distribution, dealer, representative or sales agency
agreement, contract or commitment relating to the Public Safety
Software Business;
(f) lease under which Seller is either lessor or lessee
relating to the Assets or any property at which the Assets are
located except for the lease to the premises located at ▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇;
17
(g) note, debenture, bond, equipment trust agreement, letter
of credit agreement, loan agreement or other contract or
commitment for the borrowing or lending of money relating to the
Public Safety Software Business or agreement or arrangement for a
line of credit or guarantee, pledge or undertaking of the
indebtedness of any other person relating to the Public Safety
Software Business;
(h) agreement, contract or commitment for any charitable or
political contribution relating to the Public Safety Software
Business;
(i) commitment or agreement for any capital expenditure or
leasehold improvement in excess of $5,000 relating to the Public
Safety Software Business;
(j) agreement, contract or commitment limiting or
restraining Seller, or any successor thereto from engaging or
competing in any manner or in any aspect of the Public Safety
Software Business, nor, to Seller's knowledge, is any employee of
Seller engaged in the conduct of the Public Safety Software
Business subject to any such agreement, contract or commitment;
(k) license, franchise, distributorship or other agreement
which relates in whole or in part to any software, patent,
trademark, trade name, service ▇▇▇▇ or copyright or to any ideas,
technical assistance or other know-how of or used by Seller in
the conduct of the Public Safety Software Business except as set
forth on Schedule 3.1.19(k) annexed hereto; or
(1) material agreement, contract or commitment relating to
the Public Safety Software Business not made in the ordinary
course of business.
Each of the agreements, contracts, commitments, leases, licenses,
plans and other instruments, documents and undertakings described in
the SEC Reports or listed in the Schedules in response to this Section
under which Purchaser is to acquire rights or assume obligations
hereunder is valid and enforceable in accordance with its terms;
Seller is, and to Seller's knowledge all other parties thereto are, in
compliance with the provisions thereof; Seller is not, and to Seller's
knowledge no other party thereto is, in default in the performance,
observance or fulfillment of any material obligation, covenant or
condition contained therein; and no event has occurred which with or
without the giving of notice or lapse of time, or both, would
constitute a default thereunder. Furthermore, no such agreement,
contract, commitment, lease, license, plan or other
18
instrument, document or undertaking, in the reasonable opinion of
Seller, contains any contractual requirement with which there is a
reasonable likelihood Seller or any other party thereto will be unable
to comply. No written or oral agreement, contract or commitment
described therein requires the consent of any party to its assignment
in connection with the transactions contemplated hereby, except as set
forth in Schedule 3.1.19(m) annexed hereto.
Each agreement, contract or commitment referred to in Section
3.1.19(c) hereof is in one of the forms attached to Schedule 3.1.19(c)
or as an Exhibit to the SEC Reports (whether filed with the SEC
Reports or incorporated therein by reference from reports,
registration statements or other documents filed by the Seller with
the SEC prior to the filing of the SEC Reports) with only such changes
thereto as are necessary to reflect applicable fees, products, and
time periods and such other changes therein as do not materially
affect the rights or obligations of Seller thereunder.
The Term Sheets relating to each such agreement, contract or
commitment referred to in Section 3.1.19(c) hereof which have been
previously delivered to Purchaser accurately disclosed the following:
the customer name; whether or not the contract amount is fixed or may
be varied based on services performed; if the contract amount is
fixed, the contract amount, or, if the contract amount is not fixed, a
good faith, reasonable estimate of the contract amount and the
estimated contract amount most recently communicated to the customer;
a good faith, reasonable estimate of the work completed and total
costs incurred to the date hereof thereunder; the total ▇▇▇▇▇▇▇▇ as of
the date hereof under such contract; the estimated completion dates
therefor; whether or not Seller has any reason to believe that its
profit margin with respect to such contract might be less than it has
customarily achieved in the past for similar contracts; and whether
such contract requires the furnishing of goods or services by persons
other than the employees of Seller.
3.1.20 Additional Information. Schedule 3.1.20 contains accurate
lists and summary descriptions of the following:
(a) all inventory, equipment and furniture and fixtures of
Seller included in the Assets as of the Balance Sheet Date,
specifying such items as are owned and such as are leased and,
with respect to the owned property, specifying its aggregate cost
or original value and the net book value as of Balance Sheet Date
and, with respect to the leased property as to which Seller is
lessee, specifying the identity of the lessor, the rental rate
and the unexpired term of the lease;
19
(b) the names and titles of and current annual base salary
or hourly rates for all employees of Seller engaged in the
conduct of the Public Safety Software Business, together with a
statement of the full amount and nature of any other
remuneration, whether in cash or kind, paid to each such person
during the past or current fiscal year or payable to each such
person in the future and the bonuses accrued for, the vacation
and severance benefits to which, each such person is entitled.
(c) all names under which Seller has conducted any business
or which it has otherwise used during the last five years.
3.1.21 [Intentionally Omitted]
3.1.22 Employee Benefit Plans and Arrangements. Schedule 3.1.22
annexed hereto contains a complete list of all employee benefit plans,
whether formal or informal, whether or not set forth in writing, and
whether covering one person or more than one person, sponsored or
maintained by the Seller. For the purposes hereof, the term "employee
benefit plan" includes all plans, funds, programs, policies,
arrangements, practices customs and understandings providing benefits
of economic value to any employee, former employee, or present or
former beneficiary, dependent or assignee of any such employee or
former employee other than regular salary, wages or commissions paid
substantially concurrently with the performance of the services for
which paid. Without limitation, the term "employee benefit plan"
includes all employee welfare benefit plans within the meaning of
section 3(i) of the Employee Retirement Income Security Act of 1974,
as amended ("ERISA"), all employee pension benefit plans within the
meaning of section 3(2) of ERISA. Each plan providing benefits which
are funded through a policy of insurance is indicated by the word
"insured" placed by the listing of the plan in Schedule 3.1.22.
3.1.23 Intellectual Property Matters. The Seller in the conduct
of the Public Safety Software Business did not and does not utilize
any patent, trademark, tradename, service ▇▇▇▇, copyright, computer
software, trade secret or know-how except for those described in the
SEC Reports and listed on Schedule 3.1.23(a) annexed hereto (the
"Intellectual Property"), all of which are owned by the Seller free
and clear of any liens, claims, charges or encumbrances or are
licensed by Seller from third parties. The Seller does not infringe
upon or unlawfully or wrongfully use any patent, trademark, tradename,
service ▇▇▇▇, copyright or trade secret owned or claimed by another.
The Seller is not in default under, and has not received any notice of
any claim of infringement or any other claim or proceeding relating to
any such patent, trademark, tradename, service ▇▇▇▇, copyright or
trade secret. No present or former employee of the Seller and no other
person owns or has any proprietary, financial or other interest,
direct or indirect, in whole or in part, in any patent, trademark,
tradename, service ▇▇▇▇ or copyright, or in any application therefor,
or in any trade secret, which the
20
Seller owns, possesses or uses in its operations as now or heretofore
conducted. Schedule 3.1.23(b) annexed hereto lists all confidentiality
or nondisclosure agreements to which the Seller or any of Seller's
employees engaged in the Public Safety Software Business is a party
which relates to the Public Safety Software Business.
3.1.24 The Software.
(a) Performance. The computer software of Seller included in
the Intellectual Property (the "Software") performs in accordance
with the documentation and other written material used in
connection with the Software and is free of defects in
programming and operation is year 2000 compliant as that phrase
is more fully described in Seller's Form 10-KSB is in
machinereadable form, contains all current revisions of such
software, and includes all computer programs, materials, tapes,
know-how, object and source codes, other written materials,
know-how and processes related to the Software. Seller has
delivered, or is delivering to Purchaser herewith, complete and
correct copies of all user and technical documentation related to
the Software.
(b) Enhancements, New Products. Neither Seller nor, to the
best knowledge of Seller, any employee or agent thereof has
developed or assisted in the enhancement of the Software except
for enhancements included in the Software as delivered to
Purchaser pursuant hereto or the development of any program or
product based on the Software or any part thereof.
(c) Development. No employee of Seller is, or is now
expected to be, in default under any term of any employment
contract, agreement or arrangement relating to the Software or
noncompetition arrangement, or any other Contract or any
restrictive covenant relating to the Software or its development
or exploitation. The Software was developed entirely by the
employees of Seller during the time they were employees only of
Seller and such Software does not include any inventions of the
employees made prior to the time such employees became employees
of Seller nor any intellectual property of any previous employer
of such employee.
(d) Title. All right, title and interest in and to the
Software, other than Software licensed by Seller from third
parties, is owned by Seller, free and clear of all liens, claims,
charges or encumbrances, are fully transferable to the Purchaser,
and no party other than Seller has any interest in the Software,
including without limitation, any security interest, license,
contingent interest or otherwise. Seller's development, use, sale
or exploitation of the Software does not violate, any rights of
any other person or entity and Seller has not received any
communication alleging such a violation. Seller does not have any
obligation to compensate any Person for the development, use,
sale or exploitation of the Software nor has Seller granted to
any other person or entity any license, option or other rights to
sell or exploit in any manner the Software, whether requiring the
payment of royalties or not.
21
(e) Proprietary Nature of Software. Seller has kept secret
and has not disclosed the source code for the Software owned by
it to any person or entity other than certain employees of Seller
who are subject to the terms of a binding confidentiality
agreement with respect thereto. Seller has taken all appropriate
measures to protect the confidential and proprietary nature of
the Software, including without limitation the use of
confidentiality agreements with all of its employees having
access to the Software source and object code. There have been no
patents applied for and no copyrights registered for any part of
the software. There are no trademark rights of any person or
entity in the names "ALECS I", "ALECS II", "ALECS 2000",
"AFFECT", "PISTOL", "AVL", "AMO", "CAD", "V-CAD", and "ARMS".
(f) Delivery of All Copies. All copies of the Software
embodied in physical form are being delivered to the Purchaser.
3.1.25 [Intentionally Omitted].
3.1.26 [Intentionally Omitted].
3.1.27 Availability of Documents. Seller has made available to
Purchaser copies of all documents, including without limitation all
agreements, contracts, commitments, insurance policies, plans,
instruments, undertakings, authorizations, permits, licenses, patents,
trademarks, tradenames, service marks, copyrights and applications
therefor described in the SEC Reports and listed in the Schedules
referred to herein, except those which are subject to a
confidentiality agreement, which has not been waived by the other
party thereto. Such copies are true and hereto or complete and include
all amendments, supplements and modifications thereto or waivers
currently in effect thereunder.
3.1.28 Assets. The Assets include all rights and property
necessary to the conduct of the Public Safety Software Business by
Purchaser in the manner it is presently conducted by Seller and no
property excluded from the Assets under Section 1.1.2 hereof
constitutes property or rights material to the Public Safety Software
Business.
3.1.29 Restrictions. Seller is not a party to any indenture,
agreement, contract, commitment, lease, plan, license, permit,
authorization or other instrument, document or understanding, oral or
written, or subject to any charter or other corporate restriction or
any judgment, order, writ, injunction, decree or award which
materially adversely affects or materially restricts or, so far as
Seller can now reasonably foresee, may in the future materially
adversely affect or materially restrict, the Public Safety Software
Business, operations, assets, properties, prospects or condition
(financial or otherwise) of the Public Safety Software Business after
consummation of the transactions contemplated hereby.
3.1.30 Conditions. There is no fact, development or threatened
development with respect to the markets, products, services, clients,
customers, facilities, computer software, data bases, personnel,
vendors, suppliers, operations, assets or prospects of the Public
Safety Software Business which are known to Seller which would
materially adversely
22
affect the Public Safety Software Business other than such conditions
as may affect as a whole the economy generally and as disclosed in the
SEC Reports. Seller has used its best efforts to keep available for
Purchaser the services of the employees, agents, customers and
suppliers of Seller active in the conduct of the Public Safety
Software Business. Seller does not have any reason to believe that any
loss of any employee, agent, customer or supplier or other
advantageous arrangement will result because of the consummation of
the transactions contemplated hereby which will have a material
adverse effect on the future operation of the Public Safety Software
Business by the Purchaser after the Closing.
3.1.31 Completeness of Disclosure. No representation or warranty
by Seller in this Agreement nor any certificate, schedule, statement,
document or instrument furnished or to be furnished to Purchaser
pursuant hereto, or in connection with the negotiation, execution or
performance of this Agreement, contains or will contain any untrue
statement of a material fact or omits or will omit to state a material
fact required to be stated herein or therein or necessary to make any
statement herein or therein not misleading.
3.2 Representations and Warranties of Purchaser. Purchaser
represents and warrants to Seller as follows:
3.2.1 Corporate Existence. Purchaser is a corporation duly
organized, validly existing and in good standing under the laws of the
State of New York.
3.2.2 Corporate Power, Authorization, Enforceable Obligations.
Purchaser has the corporate power, authority and legal right to
execute, deliver and perform this Agreement. The execution, delivery
and performance of this Agreement by Purchaser has been duly
authorized by all necessary corporate action. This Agreement has been,
and the other agreements, documents and instruments required to be
delivered by Purchaser in accordance with the provisions hereof (the
"Purchaser's Documents") will be, duly executed and delivered on
behalf of Purchaser by duly authorized officers or agents of
Purchaser, and this Agreement constitutes, and the Purchaser's
Documents when executed and delivered will constitute, the legal,
valid and binding obligations of Purchaser enforceable in accordance
with their respective terms.
3.2.3 Validity.of Contemplated Transactions, etc. The execution,
delivery and performance of this Agreement by Purchaser does not and
will not violate, conflict with or result in the breach of any term,
condition or provision of, or require the consent of any other party
to, (a) any existing law, ordinance, or governmental rule or
regulation to which Purchaser is subject, (b) any judgment, order,
writ, injunction, decree or award of any court, arbitrator or
23
governmental or regulatory official, body or authority which is
applicable to Purchaser, (c) the charter documents or ByLaws of, or
any securities issued by, Purchaser, or (d) any mortgage, indenture,
agreement, contract, commitment, lease, plan or other instrument,
document or understanding, oral or written, to which Purchaser is a
party or by which Purchaser is otherwise bound. Except as aforesaid,
no authorization, approval or consent of, and no registration or
filing with, any governmental or regulatory official, body or
authority is required in connection with the execution, delivery and
performance of this Agreement by Purchaser.
3.2.4 Litigation. No litigation, including any arbitration,
investigation or other proceeding of or before any court, arbitrator
or governmental or regulatory official, body or authority is pending
or, to the best knowledge of Purchaser, threatened against Purchaser
which may adversely affect the Purchaser's ability to perform its
obligations hereunder, nor does Purchaser know of any reasonably
likely basis for any such litigation, arbitration, investigation or
proceeding, the result of which could adversely affect the Purchaser's
ability to perform its obligations hereunder. Purchaser is not a party
to or subject to the provisions of any judgement, order, writ,
injunction, decree or award of any court, arbitrator or governmental
or regulatory official, body or authority which may adversely affect
Purchaser's ability to perform its obligations hereunder.
3.2.5 Restrictions. Purchaser is not a party to any indenture,
agreement, contract, commitment, lease, plan, license, permit,
authorization or other instrument, document or understanding, oral or
written, or subject to any charter or other corporate restriction or
any judgement, order, writ, injunction, decree or award which
materially adversely affects or materially restricts or, so far as
Purchaser can now reasonably foresee, may in the future materially
adversely affect or materially restrict, the Purchaser's ability to
perform its obligations hereunder.
3.2.6 Solvency. As of the Closing and immediately after the
Closing, Purchaser shall be solvent, and so far as Purchaser can
reasonably foresee, Purchaser will be able to pay and perform its
obligations hereunder as they become due.
3.2.7 Completeness of Disclosure. No representa-tion or warranty
by Purchaser in this Agreement nor any certificate, schedule,
statement, document or instrument furnished or to be furnished to
Seller pursuant hereto, or in connection with the negotiation,
execution or performance or this Agreement, contains or will contain
any untrue statement of a material fact or omits or will
24
omit to state a material fact required to be stated herein or therein
or necessary to make any statement herein or therein not misleading.
3.3 Survival of Representations and Warranties. All representations
and warranties made by the parties in this Agreement or in any certificate,
schedule, statement, document or instrument furnished hereunder or in
connection with the negotiation, execution and performance of this
Agreement shall survive the Closing for a period of three years
notwithstanding any investigation or audit conducted before or after the
Closing Date or the decision of any party to complete the closing, each
party shall be entitled to rely upon the representations and warranties set
forth herein and therein.
25
ARTICLE IV
[Intentionally Omitted]
26
ARTICLE V -ADDITIONAL DOCUMENTS TO BE DELIVERED AT THE CLOSING
5.1 Conditions To Closing At the Closing the following additional
documents will be delivered:
5.1.1 Opinions of Counsel for Seller. Counsel for Seller, shall
have delivered to Purchaser a written opinion, dated the Closing Date,
in the form of [Exhibit A] hereto with only such changes as shall be
in form and substance reasonably satisfactory to the Purchaser and its
counsel.
5.1.2 Consents and Approvals. Seller shall have delivered to
Purchaser Consents required by the terms of the contracts,
commitments, agreements or licenses listed in Disclosure Schedule 5.1.
2 hereto, or the holders of any indebtedness of Seller.
5.1.3 Purchaser Borrowing. Purchaser shall have executed
appropriate documents and obtained commercially acceptable financing
in the sum of Five Hundred Thousand ($500,000) Dollars to be available
at Closing.
5.1.4 Corporate Matters. Seller shall have delivered to Purchaser
a Certificate of the Secretary of the Seller certifying that all
corporate action required to carry out this Agreement or incidental
thereto have been duly approved.
5.1.5 Opinion of Counsel for Purchaser. Counsel to Purchaser,
shall have delivered to Seller a written opinion, dated the Closing
Date, in the form of [Exhibit B] hereto with only such changes as
shall be in form and substance reasonably satisfactory to Seller and
its counsel.
5.1.6 Corporate Matters. Purchaser shall have delivered to Seller
a Certificate of the Secretary of the Purchaser certifying that all
corporate action required to carry out this Agreement or incidental
thereto have been duly approved.
27
ARTICLE VI - INDEMNIFICATION
6.1 General Indemnification Obligation of Seller. From and after the
Closing, Seller will reimburse, indemnify and hold harmless Purchaser and
its successors and assigns (an "Indemnified Purchaser Party") against and
in respect of:
(a) any and all damages, losses, deficiencies, liabilities,
costs and expenses incurred or suffered by any Indemnified
Purchaser Party that result from, relate to or arise out of:
(i) any and all liabilities and obligations of Seller
of any nature whatsoever, except for those liabilities and
obligations of Seller which Purchaser specifically assumes
pursuant to this Agreement;
(ii) any and all actions, suits, claims, or legal,
administrative, arbitration, governmental or other
proceedings or investigations against any Indemnified
Purchaser Party that relate to the Public Safety Software
Business in which the principal event giving rise thereto
occurred prior to the Closing Date or which result from or
arise out of any action or inaction prior to the Closing
Date of Seller or any director, officer, employee, agent,
representative or subcontractor of Seller, except for those
which Purchaser specifically assumes pursuant to this
Agreement; or
(iii) any misrepresentation, breach of warranty or
nonfulfillment of any agreement or covenant on the part of
Seller under this Agreement, or from any misrepresentation
in or omission from any certificate, schedule, statement,
document or instrument furnished to Purchaser pursuant
hereto or in connection with the execution or performance of
this Agreement; and
(b) any and all actions, suits, claims, proceedings,
investigations, demands, assessments, audits, fines, judgments,
costs and other expenses (including, without limitation,
reasonable legal fees and expenses) incident to any of the
foregoing or to the enforcement of this Section 6.1.
6.2 General Indemnification Obligation of Purchaser. From and after
the Closing, Purchaser will reimburse, indemnify and hold harmless Seller
and its successors or assigns (an "Indemnified Seller Party") against and
in respect of:
(a) Any and all damages, losses, deficiencies, liabilities,
costs and expenses incurred or suffered by any Indemnified Seller
Party that result from, relate to or arise out of: (i) any and
all liabilities and obligations of Seller which have been
specifically assumed by Purchaser to this Agreement;
28
(ii) (a) any misrepresentation, breach of warranty or
non-fulfillment of any agreement or covenant on the part of
Purchaser under this Agreement, or from any
misrepresentation in or omission from any certificate,
schedule, statement, document or instrument furnished to
Seller pursuant hereto or in connection with the execution
or performance of this Agreement; and
(b) any and all actions, suits, claims, proceedings,
investigations, demands, assessments, audits, fines, judgments,
costs and other expenses (including, without limitation,
reasonable legal fees and expenses) incident to any of the
foregoing or to the enforcement of this Section 6.2.
6.3 Method of Asserting Claim. In the event that any claim or demand
for which Seller would be liable to an Indemnified Purchaser Party
hereunder is asserted against or sought to be collected from an Indemnified
Purchaser Party by a third party, the Indemnified Purchaser Party shall
promptly notify Seller of such claim or demand, specifying the nature of
such claim or demand and the amount or the estimated amount thereof to the
extent then feasible (which estimate shall not be conclusive of the final
amount of such claim and demand) (the "Claim Notice"). Seller shall have
ten (10) days from the personal delivery or mailing of the Claim Notice
(the "Notice Period") to notify the Indemnified Purchaser Party, (A)
whether or not they dispute their liability to the Indemnified Purchaser
Party hereunder with respect to such claim or demand and (B)
notwithstanding any such dispute, whether or not they desire, at their sole
cost and expense, to defend the Indemnified Purchaser Party against such
claim or demand.
(a) If Seller disputes its liability with respect to such
claim or demand or the amount thereof (whether or not Seller
desires to defend the Indemnified Purchaser Party against such
claim or demand as provided in paragraphs (b) and (c) below),
such dispute shall be resolved in accordance with Section 6.5
hereof. Pending the resolution of any dispute by Seller of its
liability with respect to any claim or demand, such claim or
demand shall not be settled without the prior written consent of
the Indemnified Purchaser Party.
(b) In the event that Seller notifies the Indemnified
Purchaser Parties within the Notice Period that it desires to
defend the Indemnified Purchaser Party against such claim or
demand then, except as hereinafter provided, Seller shall have
the right to defend the Indemnified Purchaser Party by
appropriate proceedings, which proceedings shall be promptly
settled or prosecuted by it to a final conclusion in such a
manner as to avoid any risk of Indemnified Purchaser Party
becoming subject to liability for any other matter; provided,
29
however, Seller shall not, without the prior written consent of
the Indemnified Purchaser Party, consent to the entry of any
judgment against the Indemnified Purchaser Party or enter into
any settlement or compromise which does not include, as an
unconditional term thereof, the giving by the claimant or
plaintiff to the Indemnified Purchaser Party of a release, in
form and substance satisfactory to the Indemnified Purchaser
Party, as the case may be, from all liability in respect of such
claim or litigation. If any Indemnified Purchaser Party desires
to participate in, but not control, any such defense or
settlement, it may do so at its sole cost and expense. If, in the
reasonable opinion of the Indemnified Purchaser Party, any such
claim or demand or the litigation or resolution of any such claim
or demand involves an issue or matter which could have a
materially adverse effect on the business, operations, assets,
properties or prospects of the Indemnified Purchaser Party,
including without limitation the administration of the tax
returns and responsibilities under the tax laws of any
Indemnified Purchaser Party, then the Indemnified Purchaser Party
shall have the right to control the defense or settlement of any
such claim or demand and its reasonable costs and expenses shall
be included as part of the indemnification obligation of Seller
hereunder; provided, however, that the Indemnified Purchaser
Party shall not settle any such claim or demand without the prior
written consent of Seller which consent shall not be unreasonably
withheld. If the Indemnified Purchaser Party should elect to
exercise such right, Seller shall have the right to participate
in, but not control, the defense or settlement of such claim or
demand at its sole cost and expense.
(c) (i) If Seller elects not to defend the Indemnified
Purchaser Party against such claim or demand, whether by not
giving the Indemnified Purchaser Party timely notice as provided
above or otherwise, then the amount of any such claim or demand,
or if the same be defended by Seller or by the Indemnified
Purchaser Party (but none of the Indemnified Purchaser Party
shall have any obligation to defend any such claim or demand),
then that portion thereof as to which such defense is
unsuccessful, in each case shall be conclusively deemed to be a
liability of Seller hereunder, unless Seller shall have disputed
its liability to the Indemnified Purchaser Party hereunder, as
provided in (a) above, in which event such dispute shall be
resolved as provided in Section 6.5 hereof.
(ii) In the event an Indemnified Purchaser Party should
have a claim against Seller hereunder that does not involve
a claim or demand being asserted against or sought to be
collected from it by a third party, the Indemnified
Purchaser Party shall promptly send a Claim Notice with
respect to such claim to Seller. If Seller disputes its
liability with respect to such claim or demand, such dispute
shall be resolved in accordance with Section 6.5 hereof; if
Seller does not notify the Indemnified Purchaser Party
within the Notice Period that it disputes such claim, the
amount of such claim shall be conclusively deemed a
liability of Seller hereunder.
30
(d) All claims for indemnification by an Indemnified Seller
Party under this Agreement shall be asserted and resolved under
the procedures set forth above substituting in the appropriate
place "Indemnified Seller Party" for "Indemnified Purchaser
Party" and variations thereof and "Purchaser" for "Seller".
6.4 Payment. Upon the determination of the liability under Section 6.3
or 6.5 hereof, the appropriate party shall pay to the other, as the case
may be, within ten (10) days after such determination, the amount of any
claim for indemnification made hereunder. In the event that the indemnified
party is not paid in full for any such claim pursuant to the foregoing
provisions promptly after the other party's obligation to indemnify has
been determined in accordance herewith, it shall have the right,
notwithstanding any other rights that it may have against any other person,
firm or corporation, to setoff the unpaid amount of any such claim against
any amounts owed by it under any agreements entered into pursuant to this
Agreement. Upon the payment in full of any claim, either by setoff or
otherwise, the entity making payment shall be subrogated to the rights of
an indemnified party against any person, firm or of the corporation with
respect to the subject matter of such claim.
6.5 Arbitration. (i) All disputes under this Article VI shall be
settled by arbitration in Nassau County, New York, before a single
arbitrator pursuant to the rules of the American Arbitration Association.
Arbitration may be commenced at any time by any party hereto giving to each
other party to a dispute written notice that such dispute has been referred
to arbitration under this Section 6.5. The arbitrator shall be selected by
the joint agreement of Seller and Purchaser, but if they do not so agree
within 20 days after the date of the notice referred to above, the
selection shall be made pursuant to the rules from the panels of
arbitrators maintained by such Association. Any award rendered by the
arbitrator shall be conclusive and binding upon the parties hereto;
provided, however, that any such award shall be accompanied by a written
opinion of the arbitrator giving the reasons for the award. This provision
for arbitration shall be specifically enforceable by the parties and the
decision of the arbitrator in accordance herewith shall be final and
binding and there shall be no right of appeal therefrom. Each party shall
pay its own expenses of arbitration and the expenses of the arbitrator
shall be equally shared; provided, however, that if in the opinion of the
arbitrator any claim for indemnification or any defense or objection
thereto was unreasonable, the arbitrator may assess, as part of his award,
all or any part of the arbitration expenses of the other party (including
reasonable attorneys' fees) and of the arbitrator against the party raising
such unreasonable claim, defense or objection.
(ii) To the extent that arbitration may not be legally
permitted hereunder and the parties to any dispute hereunder may
not at the time of such dispute mutually agree to submit such
dispute to arbitration any party may commence a civil action in a
court of appropriate jurisdiction to
31
solve disputes hereunder. Nothing contained in this Section 6.5
shall prevent the parties from settling any dispute by mutual
agreement at any time.
6.6 Compliance with Bulk Sales Laws. Purchaser and Seller hereby waive
compliance by Purchaser and Seller with the bulk sales law and any other
similar laws in any applicable jurisdiction in respect of the transactions
contemplated by this Agreement. Seller shall indemnify Purchaser in the
manner set forth in Section 6.3 herein from, and hold it harmless against,
any liabilities, damages, costs and expenses resulting from or arising out
of (i) the parties' failure to comply with any of such laws in respect of
the transactions contemplated by this Agreement, or (ii) any action brought
or levy made as a result thereof, other than those liabilities which have
been expressly assumed, on such terms as expressly assumed, by Purchaser
pursuant to this Agreement.
6.7 Other Rights and Remedies Not Affected. The indemnification rights
of the parties under this Article VI are independent of and in addition to
such rights and remedies as the parties may have at law or in equity or
otherwise for any misrepresentation, breach of warranty or failure to
fulfill any agreement or covenant hereunder on the part of any party
hereto, including without limitation the right to seek specific
performance, rescission or restitution, none of which rights or remedies
shall be affected or diminished hereby.
32
ARTICLE VII - POST CLOSING MATTERS
7.1 Employee Benefits. Seller shall pay directly to each employee of
the Public Safety Software Business that portion of all benefits (including
the arrangements, plans and programs set forth in Schedule 3.1.22) which
has been accrued on behalf of that employee (or is attributable to expenses
properly incurred by that employee) as of the Closing Date, and Purchaser
shall assume no liability therefor. No portion of the assets of any plan,
fund, program or arrangement, written or unwritten, heretofore sponsored or
maintained by Seller (and no amount attributable to any such plan, fund,
program or arrangement) shall be transferred to Purchaser, and Purchaser
shall not be required to continue any such plan, fund, program or
arrangement after the Closing Date. The amounts payable on account of all
benefit arrangements (other than as specified in the following subsections)
shall be determined with reference to the date of the event by reason of
which such amounts become payable, without regard to conditions subsequent,
and Purchaser shall not be liable for any claim for insurance,
reimbursement or other benefits payable by reason of any event which occurs
prior to the Closing Date. All amounts payable directly to employees, or to
any fund, program, arrangement or plan maintained by Seller therefor shall
be paid by Seller within 30 days after the Closing Date to the extent that
such payment is not inconsistent with the terms of such fund, program,
arrangement or plan. All employees of Seller who are employed by Purchaser
on or after the Closing Date shall be new employees of Purchaser and any
prior employment by Seller of such employees shall not affect entitlement
to, or the amount of, salary or other cash compensation, current or
deferred, which Purchaser may make available to its employees.
7.2 Names of Employees. As of the Closing Date, Purchaser shall offer
employment to, and Seller shall use its reasonable best efforts to assist
Purchaser in employing as new employees of Purchaser, all persons presently
engaged in the Public Safety Software Business who are identified by
Purchaser in Schedule 7.2 annexed hereto (the "New Employees"). Seller
shall terminate effective as of the Closing Date all employment agreements
it has with any of the New Employees. Until the fifth anniversary of the
Closing Date, (a) Seller will not directly or indirectly solicit or offer
employment to anyone (i) who is then an employee of Purchaser, or (ii) who
has terminated such employment with Purchaser without the consent of
Purchaser within 180 days of such solicitation or offer; and, (b) Purchaser
will not directly or indirectly solicit or offer employment to any person
who after the Closing Date (i) is then an employee of Seller, or, (ii) who
has terminated such employment with Seller without the consent of Seller
within 180 days of such solicitation or offer.
33
7.3 Discharge of Obligations. From and after the Closing Date Seller
shall pay and discharge, in accordance with past practice but not less than
on a timely basis, all obligations and liabilities incurred prior to the
Closing Date in respect of the Public Safety Software Business, or the
Assets (except for those expressly assumed by Purchaser hereunder),
including without limitation any liabilities or obligations to employees,
trade creditors and customers of the Public Safety Software Business unless
Seller disputes name, is pursuing a resolution or contesting same in good
faith and has adequately reserved against such obligation or liability.
7.4 Maintenance of Books and Records. Each of Seller and Purchaser
shall preserve until the fifth anniversary of the Closing Date all records
possessed or to be possessed by such party relating to any of the assets,
liabilities or business of the Public Safety Software Business prior to the
Closing Date. After the Closing Date, where there is a legitimate purpose,
such party shall provide the other parties with access, upon prior
reasonable written request specifying the need therefor, during regular
business hours, to (i) the officers and employees of such party and (ii)
the books of account and records of such party, but, in each case, only to
the extent relating to the assets, liabilities or business of the Public
Safety Software Business prior to the Closing Date, and the other parties
and their representatives shall have the right to make copies of such books
and records; provided, however, that the foregoing right of access shall
not be exercisable in such a manner as to interfere unreasonably with the
normal operations and business of such party; and further, provided, that,
as to so much of such information as constitutes trade secrets or
confidential business information of such party, the requesting party and
its officers, directors and representatives will use due care to not
disclose such information except (i) as required by law, (ii) with the
prior written consent of such party, which consent shall not be
unreasonably withheld, or (iii) where such information becomes available to
the public generally, or becomes generally known to competitors of such
party, through sources other than the requesting party, its affiliates or
its officers, directors or representatives. Such records may nevertheless
be destroyed by a party if such action is consistent with past practice and
such party sends to the other parties written notice of its intent to
destroy records, specifying with particularity the contents of the records
to be destroyed. Such records may then be destroyed after the 30th day
after such notice is given unless another party objects to the destruction
in which case the party seeking to destroy the records shall deliver such
records to the objecting party.
7.5 Payments Received. Seller and Purchaser each agree that after the
Closing they will hold and will promptly transfer and deliver to the other,
from time to time as and when received by them, any cash, checks with
appropriate endorsements (using their best efforts not to convert such
checks into cash), or other property that they may receive on or after the
Closing which properly belongs to the other party, including without
limitation any insurance proceeds, and
34
will account to the other for all such receipts. From and after the
Closing, Purchaser shall have the right and authority to endorse without
recourse the name of Seller on any check or any other evidences of
indebtedness received by Purchaser on account of the Public Safety Software
Business and the Assets transferred to Purchaser hereunder.
7.6 [Intentionally left Blank].
7.7 UCC Matters. From and after the Closing Date, Seller will promptly
refer all inquiries with respect to ownership of the Assets or the Public
Safety Software Business to Purchaser. In addition, Seller will execute
such documents and financing statements as Purchaser may request from time
to time to evidence transfer of the Assets to Purchaser, including any
necessary assignments of financing statements.
7.8 [Intentionally Omitted]
7.9 Covenant Not to Compete. Seller and each of its affiliates agrees
that for a period of five years after the Closing Date, neither it nor any
of its affiliates will, directly or indirectly, own, manage, operate, join,
control or participate in the ownership, management, operation or control
of, any business whether in corporate, proprietorship or partnership form
or otherwise as more than a five percent owner in such business where such
business is competitive with the Public Safety Software Business. The
parties hereto specifically acknowledge and agree that the remedy at law
for any breach of the foregoing will be inadequate and that the Purchaser,
in addition to any other relief available to it, shall be entitled to
temporary and permanent injunctive relief without the necessity of proving
actual damage. In the event that the provisions of this Section 7.9 should
ever be deemed to exceed the limitation provided by applicable law, then
the parties hereto agree that such provisions shall be reformed to set
forth the maximum limitations permitted.
7.10 Right of Setoff. In addition to any other rights and remedies
the Purchsaer has hereunder, in the event any claim, suit, or legal
administrative, arbitration or other proceeding is made or brought against the
Purchaser or the Assets (each an "Action") arising out of any actions of ▇▇▇▇
▇▇▇▇▇▇▇▇▇▇ relating to Seller's securities, which Action is brought following
the date of this Agreement and prior to December 31, 1999, Purchaser shall have
the right to set off the amount of liabilities or damages suffereed by Purchaser
arising from any Action against any Royalty Payments payable pursuamt to Section
1.3.1(b) hereof.
35
ARTICLE VIII - MISCELLANEOUS
8.1 Royalty Payments to Seller (a) On or before the fifteenth day
following the end of each calender month after the Closing Date, Purchaser
shall submit to the Seller a written statement of sales and license orders
during such calender month to which Seller is entitled to receive a Royalty
Payment as provided in Section 1.3.1(b) hereof, which, among other things,
details the nature of the transaction giving rise to the Royalty Payment
and calculates the Royalty Payment related to each transaction. Purchaser
shall remit all or part of the Royalty Payment together with said written
statement to Seller or to any person to whom Seller directs by written
notice to Purchaser.
(b) For a period of sixty (60) days following receipt of any
statement referred to in Section 8.1 hereof, Seller shall have the
right to review Purchaser's books and records to verify the accuracy
of the statement. Purchaser shall, and Purchaser shall cause its
directors, attorneys, employees, agents and representatives to fully
cooperate with seller in such accounting. Any such review shall be at
Seller's sole cost and expense (excluding Purchaser's salaries,
consultation and professional fees payable by Seller to its employees,
consultants, attorneys, accountants and other professional advisors)
and shall be made upon reasonable notice to Purchaser and during
Purchaser's usual business hours; provided, however, if any inaccuracy
or error in the amount of Royalty Payments is discovered by Seller,
during any accounting, Purchaser shall promptly reimburse Seller for
its costs and expenses of such accounting.
(c) In the event that the Seller and Purchaser disagree on the
amount payable to Seller, the dispute shall be resolved as provided in
Section 6.5 hereof.
8.2 Purchaser's Use of Seller's Office Space. In order to facilitate
an orderly transition of the Public Safety Software Business, following the
Closing and through July 31, 1999, Seller shall permit Purchaser, at
Purchaser's option, to use up to sixty (60%) percent of Seller's office
space at ▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇. Purchaser shall pay Seller
pro rata under Seller's lease for, and utilities and maintenance costs
relating to, said space as set forth on Schedule 8.2 annexed hereto.
Purchaser shall give Seller ten (10) days notice of its intent to vacate
the premises.
8.3 Consultation with Seller's employees. In order to provide for an
orderly transition of the Public Safety Software
36
Business and service of Seller's customers, for a period of up to six (6)
months after the Closing, Seller shall, to the best of its ability, make
available to Purchaser employees of Seller to assist in the transfer, use
and operation of Seller's Public Safety Software Systems. Purchaser shall
pay Seller a standard hourly rate for the services provided by such
employees.
8.4 Brokers' and Finders' Fees.(a) Seller represents and warrants to
Purchaser that all negotiations relative to this Agreement have been
carried on by it directly without the intervention of any person, who may
be entitled to any brokerage or finder's fee or other commission in respect
of this Agreement or the consummation of the transactions contemplated
hereby, and Seller agrees to indemnify and hold harmless Purchaser against
any and all claims, losses, liabilities and expenses which may be asserted
against or incurred by it as a result of Seller's dealings, arrangements or
agreements with any such person.
(b) Purchaser represents and warrants that all negotiations
relative to this Agreement have been carried on by it directly without
the intervention of any person who may be entitled to any brokerage or
finder's fee or other commission in respect of this Agreement or the
consummation of the transactions contemplated hereby, and Purchaser
agrees to indemnify and hold harmless Seller against any and all
claims, losses, liabilities and expenses which may be asserted against
or incurred by it as a result of Purchaser's dealings, arrangements or
agreements with or any such person.
8.5 Sales, Transfer and Documentary Taxes, etc. Seller shall pay all
federal, state and local sales, documentary and other transfer taxes, if
any, due as a result of the purchase, sale or transfer of the Assets in
accordance herewith whether imposed by law on Seller or Purchaser and
Seller shall indemnify, reimburse and hold harmless Purchaser in respect of
the liability for payment of or failure to pay the filing of or failure to
file any such taxes or reports required in connection therewith.
8.6 Expenses. Except as otherwise provided in this Agreement, each
party hereto shall pay its own expenses incidental to the preparation of
this Agreement, the carrying out of the provisions of this Agreement and
the consummation of the transactions contemplated hereby.
8.7 Entire Agreement. This Agreement (including the documents referred
to herein) constitutes the entire agreement between Seller and Purchaser
and supersedes any prior understandings, agreements, or representations by
or between Seller and Purchaser, written or oral, to the extent they
related in any way to the subject matter hereof.
37
8.8 Succession and Assignment. This Agreement may not be assigned
prior to the Closing by any party hereto without the prior written consent
of the other parties. Subject to the foregoing, all of the terms and
provisions of this Agreement shall be binding upon and inure to the benefit
of and be enforceable by the successors and assigns of Seller and
Purchaser.
8.9 Waiver. Any term or provision of this Agreement may be waived at
any time by the party entitled to the benefit thereof by a written
instrument duly executed by such party.
8.10 Notices. Any notice, request, demand, waiver, consent, approval
or other communication which is required or permitted hereunder shall be in
writing and shall be deemed given only if delivered personally or sent by
registered or certified mail, return receipt requested, postage prepaid, or
sent by confirmed facsimile transmission, overnight mail or nationally
recognized overnight courier as follows:
If to Purchaser, to:
Admit Computer Services, Inc.
▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇, President
Telecopier Number: (▇▇▇) ▇▇▇-▇▇▇▇
With a required copy to:
▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇, Esq.
▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇ ▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Telecopier Number: (▇▇▇) ▇▇▇-▇▇▇▇
If to Seller to:
Compu-▇▇▇▇, Inc.
c/o ▇.▇▇ Commerce, Inc.
▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇▇▇ ▇▇▇
▇▇▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: Chief Financial Officer
Telecopier Number: (▇▇▇) ▇▇▇-▇▇▇▇
With a required copy to:
Certilman Balin ▇▇▇▇▇ & ▇▇▇▇▇, LLP
▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇ ▇. ▇▇▇▇▇, Esq.
Telecopier Number: (▇▇▇) ▇▇▇-▇▇▇▇
38
or to such other address as the addressee may have specified in a
notice duly given to the sender as provided herein. Such notice,
request, demand, waiver, consent, approval or other communication will
be deemed to have been given as of the date so delivered, or, in the
case of mailing, except overnight mail, three days after it is mailed.
8.11 New York Law to Govern. This Agreement shall be governed by and
interpreted and enforced in accordance with the laws of the State of New
York, excluding choice of law principles thereof. Venue for all court
proceedings hereunder shall be in Nassau County, State of New York.
8.12 No Benefit to Others. The representations, warranties, covenants
and agreements contained in this Agreement are for the sole benefit of the
parties hereto and, in the case of Article VI hereof, the other Indemnified
Parties, and their heirs, executors, administrators, legal representatives,
successors and assigns, and they shall not be construed as conferring any
rights on any other persons.
8.13 Headings and Gender. All section headings contained in this
Agreement are for convenience of reference only, do not form a part of this
Agreement and shall not affect in any way the meaning or interpretation of
this Agreement. Words used herein, regardless of the number and gender
specifically used, shall be deemed and construed to include any other
number, singular or plural, and any other gender, masculine, feminine, or
neuter, as the context requires.
8.14 All Exhibits and Schedules. The Exhibits and schedules identified
in this Agreement are incorporated herein by reference and made a part
hereof.
8.15 Severability. Any term or provision of this Agreement that is
invalid or unenforceable in any situation in any jurisdiction shall not
affect the validity or enforceability of the remaining terms and provisions
hereof or the validity or enforceability of the offending term or provision
in any other situation or in any other jurisdiction.
8.16 Counterparts. This Agreement may be executed in one or more
counterparts, each of which shall be deemed an original but all of which
together will constitute one and the same instrument.
8.17 Publicity. Neither Seller nor Purchaser will issue any report,
statement, release or other public announcement pertaining to the matters
contemplated by this Agreement or otherwise disclose the terms hereof
without the prior written consent of the other. Notwithstanding the
foregoing, Seller is permitted to make any disclosures or public
announcements of the transactions contemplated hereby and/or the terms
thereof without the prior written consent and approval of Purchaser if
Seller shall determine that such disclosure is required in order for Seller
to comply with applicable securities laws and regulations.
39
IN WITNESS WHEREOF, the parties hereto have duly executed this
Agreement on the date first written.
ATTEST: ADMIT COMPUTER SERVICES, INC.
By: /s/ ▇▇▇▇▇▇▇▇ ▇▇▇▇ By /s/ ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇
--------------------- ----------------------
As its As its President
ATTEST: Compu-▇▇▇▇, Inc.
By By /s/ ▇▇▇▇ ▇. Theale, Jr.
------------------- --------------------------
As its As its Vice Chairman
40