ASSET AND STOCK PURCHASE AGREEMENT
AGREEMENT, dated as of the 29th day of July 1997, by and among GameTek (UK)
Limited ("GameTek"), a United Kingdom corporation, Alternative Reality
Technologies, Inc. ("ART"), a Florida corporation (GameTek and ART are sometimes
hereinafter collectively referred to as "Sellers"), GameTek (FL), Inc., a
Florida corporation (the "Stockholder") and Take Two Interactive Software, Inc.
("Buyer").
W I T N E S S E T H :
WHEREAS, the Stockholder is the owner of all of the issued and outstanding
Common Stock of the Sellers; and
WHEREAS, the Stockholder is also the owner of certain assets which the
Buyer wishes to purchase; and
WHEREAS, the Sellers are engaged in the business of creating, developing
and/or distributing computer software games (the "Business"); and
WHEREAS, the Stockholder wishes to sell to Buyer, and Buyer wishes to
purchase from Stockholder, all of Stockholder's right, title and interest in (i)
PC CD software games known as Dark Colony, Quarantine and Road Warrior (the
"Existing Titles"), (ii) the PC CD software games known as Guardians of Justice,
the Reap and all other software programs and PC CD games being developed in
GameTek's office (the "UK Titles") and (iii) all of the outstanding capital
stock of the Sellers (the "Stock").
WHEREAS, simultaneously herewith Buyer and Stockholder are entering into a
distribution agreement (the "Gameboy Distribution Agreement"), a copy of which
is annexed hereto as Exhibit A pursuant to which Buyer shall receive the
European distribution rights to all Gameboy Titles currently published by the
Stockholder (the "Gameboy Titles").
WHEREAS, simultaneously herewith, Buyer and Stockholder are entering into a
distribution agreement (the "Jeopardy Distribution Agreement"), a copy of which
is annexed hereto as Exhibit A-1 (the Jeopardy Distribution Agreement and the
Gameboy Distribution Agreement are hereinafter sometimes referred to
collectively as the "Distribution Agreements").
NOW, THEREFORE, in consideration of and in reliance upon the covenants,
conditions, representations and warranties herein contained, the parties hereto
hereby agree as follows:
1. Purchase and Sale Agreement.
1.1 Agreement of Purchase and Sale. Subject to the terms and
conditions set forth in this Agreement and in reliance upon the
representations, warranties, covenants and conditions herein contained,
Stockholder is (a) selling, conveying, assigning, transferring and
delivering to Buyer, and Buyer is purchasing from Stockholder, the
Purchased Assets (as defined in subparagraph 1.2 hereof), free and clear of
any and all liens, claims, charges or encumbrances of any nature whatsoever
other than those created by third party agreements set forth on Schedule
1.3 and those that are reflected on or referred to in the financial
statements identified in section 4.6 hereof (collectively, the "Permitted
Encumbrances").
1.2 Purchased Assets. As used in this Agreement, the term "Purchased
Assets" means (i) all of Stockholder's rights, title and interest in the
Existing Titles, and (ii) all of Stockholder's rights, title and interest
in the UK Titles; (the Existing Titles, and the UK Titles are sometimes
hereinafter collectively referred to as the "Software Assets"); and (iii)
the Stock. Schedule 1.2 contains a complete list of all Existing Titles and
all UK Titles. The transfer of the Existing Titles and the UK Titles (and
the term "Purchased Assets") includes all of Stockholder's right, title and
interest in all forms of expression and media, including but not limited to
the source code, object code, flowcharts, block diagrams, and all related
documentation; and all trade secrets, know-how, inventions (whether or not
patentable), proprietary rights and intellectual property contained
therein, including, without limitation, all copyrights, trademarks and
patents and all applications therefor, goodwill, all right, title, interest
and benefit of Stockholder in, to, and under, and subject to, all
agreements, contracts and licenses entered into by Stockholder, or having
Stockholder as a beneficiary, and pertaining to the Existing Title and UK
Titles and all System Documentation and End User Documentation (as
hereinafter defined).
1.3 Assumed Liabilities. Subject to the terms and conditions set forth
in this Agreement and in reliance upon the representations, warranties,
covenants and conditions herein contained, Buyer is assuming, and shall
only assume all obligations of Sellers, Stockholder and/or the entities
listed on Schedule 1.3 as Stockholder's affiliates (the "Affiliates") under
the third-party agreements relating to the Existing Titles and the UK
Titles, all of which agreements are listed on Schedule 1.3 (the "Assumed
Agreements") (the assumed liabilities set forth above are collectively
referred to hereinafter as the "Assumed Liabilities"). All of Stockholders
liabilities and obligations which are not being assumed by Buyer pursuant
hereto are hereinafter collectively called the "Retained Liabilities".
1.4 Purchase Price. The purchase price for the Purchased Assets
consists of the following: (a) $50,000, (b) 406,553 shares (the "Stock
Consideration") of the common stock of
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the Buyer, (c) two unsecured promissory notes in the principal amounts of
$500,000 and $200,000, respectively (the "Promissory Notes") of Buyer, in
the form annexed hereto as Exhibit B-1 and B-2, (d) the assumption by Buyer
of all of the Assumed Liabilities pursuant to the Assumption and Assignment
Agreement attached hereto as Exhibit C and (e) the tax refund, if any,
referred to in Section 3.7 (the aggregate of (a), (b), (c), (d) and (e) is
collectively referred to hereinafter as the "Purchase Price").
2. Closing.
2.1 Closing Date. This Agreement shall be executed, and the closing of
the sale and purchase provided for herein (the "Closing") shall take place
at 10 a.m., New York time, at the offices of ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇ LLP, ▇▇▇
▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇ on the date hereof
(such time and date of Closing being hereinafter called the "Closing
Date").
2.2 Action by Buyer. Simultaneously herewith, Buyer is delivering or
causing to be delivered to Stockholder (in addition to the documents and
instruments to be delivered by it pursuant to paragraph 3 hereof), (a) on
account of the Purchase Price (i) $50,000, (ii) the Promissory Notes, (iii)
certificates representing the Stock Consideration registered as directed by
the Stockholder and (b) an opinion of ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇ LLP, counsel to the
Buyer, dated the Closing Date, in substantially the form annexed hereto as
Exhibit D and (c) the Assumption and Assignment Agreement.
2.3 Action by Stockholder. Simultaneously herewith, Stockholder is
delivering to Buyer (in addition to the documents and instruments to be
delivered by it pursuant to paragraph 3 hereof): (i) a duly executed ▇▇▇▇
of Sale and Assignment in substantially the form attached hereto as Exhibit
E with respect to the Software Assets, (ii) all such patent, trademark,
trade name and copyright assignments (in the form attached hereto as
Exhibit F), (iii) the Distribution Agreements, (iv) an opinion of ▇▇▇▇▇▇▇▇,
▇▇▇▇▇▇ & ▇▇▇▇▇▇, LLP, counsel for Stockholder and Sellers, dated the
Closing Date, in substantially the form of Exhibit G hereto and (v) all
third party consents and governmental and administrative approvals, as are,
in the opinion of Buyer, necessary or appropriate in order to convey,
transfer and assign to and vest in Buyer good and marketable right, title
and interest in and to the Purchased Assets free and clear of all liens,
security interests, claims, charges and encumbrances of any nature
whatsoever, except for consents or approvals required under any agreement
set forth in Schedule 1.3 and indicated thereon the Permitted Encumbrances,
and (vi) certificates representing the Stock with stock powers duly
executed in blank. Simultaneously herewith, Stockholder is delivering (i)
the entire inventory of copies of the Existing Titles and the UK Titles in
object form, consisting of disks together with all improvements,
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corrections, modifications, updates enhancements or other changes; (2) a
master copy of the software (in both source and object code format of the
Existing Titles and the UK Titles), in a form suitable for copying (to the
extent such masters exist); and (3) all existing System Documentation and
User Documentation. System Documentation means all documentation used in
the development and updating of the Existing and U.K. Titles, including but
not limited to, design or development specifications, error reports, and
related correspondence and memoranda. User Documentation means the end-user
instruction manual that usually accompanies the Existing Titles and UK
Titles instructing end users in the use of the Existing Titles and UK
Titles in both printed and electronic form.
3. Additional Covenants.
3.1 Further Assurances. Stockholder hereby agrees that it shall from
time to time after the Closing Date, at Buyer's sole cost and expense, take
any and all actions, and execute, acknowledge, deliver, file and/or record
any and all documents and instruments, as Buyer may reasonably request, in
order to more fully perfect the rights which are intended to be granted to
Buyer hereunder.
3.2 Payment of Taxes Upon Transfer of Purchased Assets. Stockholder
shall be responsible for, and shall pay, any and all sales, use, purchase,
transfer and similar taxes, and any and all filing, recording, registration
and similar fees, arising out of the transactions contemplated by this
Agreement.
3.3 Survival of Representations and Warranties. Each of the parties
hereto hereby agrees that all representations and warranties made by or on
behalf of it in this Agreement or in any document or instrument delivered
pursuant hereto shall survive the Closing Date and the consummation of the
transactions contemplated hereby for a period of eighteen (18) months,
provided, however, that the representations and warranties set forth in
Section 4.13 (taxes), Section 4.4 (authority) and Section 4.8 (assets free
and clear) shall continue until the expiration of the applicable statute of
limitations.
3.4 Books and Records. Stockholder shall, for a period of at least
three years following the Closing Date, maintain and make available to
Buyer and its representatives for inspection and reproduction, during
regular business hours, all books and records relating to Sellers, the
Purchased Assets, the Business or the Assumed Liabilities which are not
included among the Purchased Assets and which are retained by the
Stockholder. Buyer shall, for a period of at least three years following
the Closing Date, maintain and make available to Stockholder and its
representatives for inspection and reproduction, during regular business
hours upon reasonable notice, all books and records relating to Sellers,
which are included among the Purchased Assets or delivered to or left in
the possession of Sellers, but
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only insofar as said books and records relate to periods ending on or prior
to the Closing Date.
3.5 Employment Agreement. Simultaneously herewith, ▇▇▇▇▇ ▇▇▇▇▇▇ is
delivering to GameTek an Employment Agreement in the form annexed hereto as
Exhibit I.
3.6 Discharge of Liens. Stockholder or Sellers have caused all liens,
claims, charges and encumbrances upon any of the Purchased Assets or any of
the assets of either Seller that are not reflected or referred to in the
latest financial statements referred to in Section 4.6 hereof or that did
not arise after the date thereof in the ordinary course of business, to be
terminated or otherwise discharged at or prior to the Closing other than
the Permitted Encumbrances.
3.7 Cancellation of Intercompany Indebtedness. On or prior to the
Closing Date, each of Stockholder and any Affiliate shall cause all
intercompany indebtedness due from Sellers to Stockholder and any Affiliate
to be converted into equity. Any tax refunds due to and received by either
GameTek or ART in respect of periods prior to the Closing Date which are
not reflected on the balance sheet of Sellers previously furnished to Buyer
shall be paid to Stockholder as an additional payment of Purchase Price
including, without limitation, the tax refund of approximately 250,000
pounds sterling owed to GameTek in respect of fiscal 1994 and fiscal 1995.
Buyer, Sellers and Stockholder shall cooperate with each other and use
their reasonable best efforts to obtain such refund and cause the same to
be paid to Stockholder promptly.
3.8 Liabilities. Subsequent to the Closing Date, Stockholder
shall pay, discharge and perform the Retained Liabilities in due course and
Sellers shall pay, discharge and perform Seller's Liabilities (as
hereinafter defined) in due course. Seller's Liabilities shall mean all
obligations and liabilities of Sellers existing as of the date hereof
whether matured, unmatured or contingent, known or unknown.
3.9 Registration Rights. Simultaneously herewith, Buyer and
Stockholder are executing and delivering a registration rights agreement in
substantially the form annexed hereto as Exhibit J (the "Registration
Rights Agreement").
3.10 Certificate of Stockholder. Simultaneously herewith, Stockholder
is delivering a certificate of the Secretary of Stockholder stating that
the sale of all of the Stock and the Purchased Assets has been approved by
the directors of Stockholder and annexing true and correct copies of the
minutes approving the execution and delivery of the Agreement and the
consummation of the transactions contemplated thereby.
3.11 Certificate of Buyer. Simultaneously herewith, Buyer is
delivering a certificate by its Secretary stating that the acquisition of
the Purchased Assets and the issuance of the Promissory Notes and Stock
Consideration has been approved by the shareholders of Buyer and annexing a
true and correct copy of the Buyer's minutes approving such acquisition.
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3.12 Use of Name. Promptly after the execution hereof, and at its cost
and expense, Buyer shall change the corporate name of each of each of the
Sellers and GameTek Deutschland GmbH to a name bearing no resemblance to
either Alternative Reality Technologies, Inc., GameTek (UK) Limited or
GameTek Deutschland GmbH, the rights to which are being retained by
Stockholder; provided, however, that the Buyer may continue to use the
GameTek and ART names in connection with the disposition of existing
finished goods inventory of games subject to existing purchase orders for
finished goods inventory.
3.13 Cooperation. Each of the parties hereto hereby agrees to fully
cooperate with the other parties hereto in preparing and filing any
notices, applications, reports and other instruments and documents which
are required by, or which are desirable in the opinion of any of the
parties hereto, in respect of any statute, rule, regulation or order of any
governmental or administrative body in connection with the transactions
contemplated hereby, including, without limitation, the execution and
filing of any financial reports or tax returns which are delinquent as of
the Closing Date.
4. Representations and Warranties as to Seller and Stockholder. Sellers and
the Stockholder hereby severally and not jointly represent and warrant to Buyer
as follows:
4.1 Organization, Standing and Power. Each of the Stockholder, GameTek
and ART is a corporation duly organized, validly existing and in good
standing under the laws of Florida, the United Kingdom and Florida,
respectively, with full corporate power and authority to own, lease and
operate its respective properties and to carry on its respective business
as presently conducted by it. There are no states or jurisdictions in which
the character and location of any of the properties owned or leased by
either of GameTek or ART, or the conduct of its respective business, makes
it necessary for it to qualify to do business as a foreign corporation and
where it has not so qualified, except for those jurisdictions in which the
failure to so qualify would not have a materially adverse effect on the
business or operations of such entity. Copies of the Certificate of
Incorporation of each of Stockholder, GameTek and ART and all amendments
thereof, and of the By-laws of each of Stockholder, GameTek and ART, as
amended to date, have been furnished to Buyer and are complete and correct.
GameTek's and ART's respective minute books heretofore exhibited to Buyer
contain complete and accurate records of all meetings and other corporate
actions of their respective stockholders and Board of Directors (including
committees of its Board of Directors).
4.2 Capitalization. The authorized capital stock of GameTek consists
of 1,677,756 shares of Common Stock, par value one pound sterling per
share, of which 1,050,601 shares are issued and outstanding. The authorized
capital stock of ART consists of 200 shares of Common Stock, par value
$0.01 per
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share, of which 100 shares are issued and outstanding. Stockholder owns all
of the Stock of the Sellers and has good and valid title to the Stock, free
and clear of any and all liens, claims, charges and encumbrances of any
nature whatsoever. The Stock has not been assigned, transferred,
hypothecated or otherwise encumbered. There are no outstanding options,
warrants, rights, calls, commitments, conversion rights, puts, plans or
other agreements of any character to which Stockholder or the Sellers are a
party or otherwise bound which provide for the acquisition or disposition
of any of the Stock or any of the securities of either Seller. All of the
Stock has been duly and validly issued and is fully paid and nonassessable.
4.3 Interests in Other Entities. Neither GameTek nor ART (A) own,
directly or indirectly, of record or beneficially, any shares of voting
stock or other equity securities of any other corporation except that
GameTek Deutschland GmbH is a wholly owned subsidiary of GameTek, (B) have
any ownership interest, direct or indirect, of record or beneficially, in
any unincorporated entity, or (C) have any obligation, direct or indirect,
present or contingent, (1) to purchase or subscribe for any interest in,
advance or loan monies to, or in any way make investments in, any person or
entity, or (2) to share any profits or capital investments or both other
than those set forth on Schedule 4.3 annexed hereto.
4.4 Authority. The execution and delivery by Stockholder, GameTek and
ART of this Agreement and of all of the agreements to be executed and
delivered by each of them pursuant hereto (including, without limitation,
the Distribution Agreements), the performance by each of them of its
respective obligations hereunder and thereunder, and the consummation of
the transactions contemplated hereby and thereby, have been duly and
validly authorized by all necessary corporate action on the part of
Stockholder, GameTek and ART (including, but not limited to, the unanimous
consent of their respective stockholders, if required, and Boards of
Directors) and each of Stockholder, GameTek and ART has all necessary power
with respect thereto. This Agreement is, and when executed and delivered by
Stockholder and the Sellers (to the extent that they are parties thereto)
each of the other agreements to be delivered by any or all of them pursuant
hereto will be, the valid and binding obligation of Stockholder, GameTek
and ART (to the extent that they are parties thereto) in accordance with
its terms.
4.5 Noncontravention. Neither the execution and delivery by
Stockholder and/or the Sellers of this Agreement or of any agreement to be
executed and delivered by Stockholder and/or the Sellers pursuant hereto,
nor the consummation of any of the transactions contemplated hereby or
thereby, nor the performance by Stockholder or the Sellers of their
respective obligations, as the case may be, hereunder or thereunder, will
(nor with the giving of notice or the lapse of time or both
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would) (a) conflict with or result in a breach of any provision of the
Certificate of Incorporation or By-laws of the Stockholder or the Sellers,
or (b) except as set forth on Schedule 1.3, give rise to a default, or any
right of termination, cancellation or acceleration, or otherwise be in
conflict with or result in a loss of contractual benefits to the Sellers
or, with respect to the UK Titles, the Existing Titles or the GameBoy
Titles (collectively the "Titles"), under any of the terms, conditions or
provisions of any note, bond, mortgage, indenture, license, agreement or
other instrument or obligation to which it is a party or by which the
Sellers or the Stockholder may be bound or to which the Titles may be
subject, or require any consent, approval or notice under the terms of any
such document or instrument, or (c) except as set forth on Schedule 1.3,
violate any order, writ, injunction, decree, law, statute, rule or
regulation of any court or governmental authority which is applicable to
Stockholder with respect to the UK Titles, the Existing Titles or the
GameBoy Titles, or the Sellers, or (d) except as set forth on Schedule 1.3,
result in the creation or imposition of any lien, claim, charge,
restriction or encumbrance upon any of the properties or assets of the
Sellers, or, with respect to the UK Titles, the Existing Titles or the
GameBoy Titles or (e) except as set forth on Schedule 1.3, give any
individual or entity a legally enforceable claim against Buyer,
Stockholder, Sellers or the Stock.
4.6 Financial Statements. Attached to Schedule 4.6 are copies of
GameTek's and ART's respective unaudited balance sheets as of June 15, 1997
(the "Balance Sheets"). Said Balance Sheets fairly present the financial
position of each of GameTek and ART as at the dates thereof and each is
true and correct in all material respects. Notwithstanding the foregoing or
any other provision hereof to the contrary, neither Stockholder nor Sellers
make any representation or warranty of any kind regarding the
collectability of any account receivable or note receivable reflected on
the Balance Sheets, the availability to any person or entity of any
set-offs, contras, counterclaims, rights of recoupment or similar claims to
any portion thereof, or with respect to the likelihood or amount of future
product returns or claims for price protection, discounts, allowances or
similar claims in respect of products sold prior to the Closing hereunder,
or with respect to the inventory shown thereon except as provided in
Section 4.11 below. Except as set forth on Schedule 4.6, the books and
records of each of GameTek and ART are in all material respects complete
and correct, have been maintained in accordance with good business
practices, and accurately reflect the basis for the financial condition of
each of GameTek and ART as set forth in the aforementioned financial
statements.
4.7 Absence of Undisclosed Liabilities. Subject to the penultimate
sentence of Section 4.6, and except for Permitted Encumbrances, Sellers
have no liabilities or
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obligations of any nature whatsoever, whether accrued, absolute, contingent
or otherwise which have not been (i) in the case of liabilities and
obligations of a type customarily reflected on a corporate balance sheet
prepared in accordance with generally accepted accounting principles, set
forth on the balance sheet described in subparagraph 4.6 above or (ii) in
the case of other types of liabilities and obligations, described in any of
the Schedules delivered pursuant hereto or omitted from said Schedules in
accordance with the terms of this Agreement, or (iii) incurred, consistent
with past practice, in the ordinary course of business since June 15, 1997
(in the case of liabilities and obligations of the type referred to in
clause (i) above).
4.8 Properties. (a) Stockholder has good and valid title to all of the
Purchased Assets, free and clear of all mortgages, liens, pledges, claims,
charges or encumbrances of any nature whatsoever ("Liens"), except for
Permitted Encumbrances and for those which are described on Schedule 4.8
hereto.
(b) Except as set forth on Schedule 4.8 and except for Permitted
Encumbrances, each Seller has good and valid title to all of the properties
and assets, reflected on the Balance Sheet as owned by it or thereafter
acquired, except properties or assets sold or otherwise disposed of in the
ordinary course of business, free and clear of any and all Liens except for
Permitted Encumbrances and Liens not yet due and payable or being contested
in good faith by appropriate proceedings. All plants, structures and
equipment which are utilized in the Sellers' Businesses, or are material to
the condition (financial or otherwise) of either Seller are owned or leased
by either Seller. Schedule 4.8 sets forth all (a) real property which is
owned, leased (whether as lessor or lessee) or subject to contract or
commitment of purchase or sale or lease (whether as lessor or lessee) by
either Seller, or which is subject to a title retention or conditional
sales agreement or other security device, and (b) tangible personal
property which is owned, leased (whether as lessor or lessee) or subject to
contract or commitment of purchase or sale or lease (whether as lessor or
lessee) by either Seller.
(c) Except as otherwise provided herein or in any third party
agreement identified in Schedule 1.3, Buyer shall receive, pursuant to this
Agreement as of the Closing Date, complete and exclusive right, title and
interest in and to all tangible and intangible property rights existing in
the Existing Titles and UK Titles.
(d) Except as otherwise provided herein or in any third party
agreement identified in Schedule 1.3, Stockholder has developed the
Existing Titles and UK Titles entirely through its own efforts for its own
account.
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(e) To the best of Stockholder's knowledge, except as otherwise
provided herein or in any third party agreement identified in Schedule 1.3,
the Existing Titles and UK Titles do not infringe any patent, copyright or
trade secret of any third party.
(f) Except as otherwise provided herein or in any third party
agreement identified in Schedule 1.3, all personnel, including employees,
agents, consultants, and contractors, who have contributed to or
participated in the conception and development of the Existing Titles and
UK Titles either (1) have been party to a work-for-hire relationship with
Stockholder that has accorded Stockholder full, effective and exclusive
original ownership of all tangible and intangible property arising with
respect to the Existing Titles and UK Titles or (2) have executed
appropriate instruments of assignment in favor of Stockholder as assignee
that have conveyed to Stockholder full, effective and exclusive ownership
of all tangible and intangible property thereby arising with respect to the
Existing Titles and UK Titles.
4.9 Litigation. Other than as set forth in Schedule 4.9 annexed
hereto, there are no suits or actions, or administrative, arbitration or
other proceedings or governmental investigations, pending or, to the best
of the knowledge of Stockholder or Sellers, threatened, against or relating
to Sellers, the Business or any of the Purchased Assets. There are no
judgments, orders, stipulations, injunctions, decrees or awards in effect
which relate to Sellers, the Business or any of the Purchased Assets, the
effect of which is (A) to limit, restrict, regulate, enjoin or prohibit any
business practice in any area, or the acquisition of any properties, assets
or businesses, or (B) otherwise materially adverse to the Business or any
of the Purchased Assets.
4.10 No Violation of Law. Sellers and/or Stockholder, as the case may
be, are not engaging in any activity or omitting to take any action as a
result of which (A) they are in violation of any law, rule, regulation,
zoning or other ordinance, statute, order, injunction or decree, or any
other requirement of any court or governmental or administrative body or
agency, applicable to Sellers, the Business or any of the Purchased Assets,
including, but not limited to, those relating to: occupational safety and
health; environmental and ecological protection (e.g., the use, storage,
handling, transport or disposal of pollutants, contaminants or hazardous or
toxic materials or wastes, and the exposure of persons thereto); business
practices and operations; labor practices; employee benefits; and zoning
and other land use, and (B) Seller, the Business and/or any of the
Purchased Assets have been or will be materially and adversely affected.
4.11 Inventories. To the best knowledge of Stockholder and Sellers,
the inventories reflected on the Balance
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Sheets and thereafter added consist of items of a quality and quantity
usable or saleable in the ordinary course of business, except for obsolete
materials, slow-moving items, materials of below standard quality and not
readily marketable items, all of which have been written down to net
realizable value or adequately reserved against on the books and records of
GameTek, ART, or GameTek Deutschland GmbH, respectively.
4.12 Intellectual Property. Annexed hereto as Schedule 4.12 is a list
containing a complete and correct list of all (A) United States and foreign
patents, trademark and trade name registrations, trademarks and trade
names, brandmarks and brand name registrations, servicemarks and
servicemark registrations, assumed names and copyrights and copyright
registrations, owned in whole or in part or used by Sellers or with respect
to the Software Assets, and all applications therefor, (B) inventions,
discoveries, improvements, processes, formulae, proprietary rights and
trade secrets required for the development of the Software Assets and
sequels thereof, and (C) licenses and other agreements to which Sellers or
Stockholder (with respect to the Purchased Assets) are a party to or
otherwise bound which relate to any of the foregoing. Except as expressly
set forth in the documents listed in Schedule 4.8, (A) Sellers or
Stockholder owns or has the right to use all of the foregoing; (B) no
proceedings have been instituted, are pending or, to the best of the
knowledge of Sellers and Stockholder are threatened, which challenge the
rights of Sellers or Stockholder in respect thereto or the validity
thereof; and (C) to the best of the knowledge of Sellers and Stockholder,
none of the aforesaid violates any laws, statutes, ordinances or
regulations, or has at any time infringed upon or violated any rights of
others, or is being infringed by others; and (D) to the best knowledge of
Sellers and Stockholder, none of the aforesaid is subject to any
outstanding order, decree, judgment, stipulation or charge. The foregoing
sentence notwithstanding, Buyer acknowledges that the title Dark Colony is
subject to an existing distribution agreement with Strategic Simulations,
Inc. and that the GameBoy Titles are subject to a distribution agreement
with Microware, Inc., copies of which have been provided to Buyer. To the
extent owned by Stockholder or Sellers, the Existing Titles and UK Titles
are fully eligible for protection under applicable copyright law and has
not been forfeited to te public domain; and that the source code and system
specifications for the Existing Titles and UK Titles have been maintained
in confidence.
4.13 Tax Matters. GameTek and ART, respectively, have filed with the
appropriate governmental agencies all tax returns and reports required to
be filed by it, and has paid in full or made adequate provision for the
payment of, all taxes, interest, penalties, assessments and deficiencies
shown to be due or claimed to be due on such tax returns and reports,
except that ART has not yet filed tax returns for the fiscal year ending
July 31, 1996. The provision for income and other taxes which is set forth
on the balance sheets referred to in subparagraph 4.6
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above, together with any available tax receivable or loss carryforward or
other tax credit, are adequate for all accrued and unpaid income taxes of
Sellers as of June 15, 1997, whether (A) incurred in respect of or measured
by income of Sellers for any periods prior to the close of business on that
date, or (B) arising out of transactions entered into, or any state of
facts existing on or prior to that date. To the best knowledge of
Stockholder and Sellers, Sellers have not executed or filed with any taxing
authority any agreement extending the period for the assessment or
collection of any income or other taxes, and is not a party to any pending
or, to the best of the knowledge of Sellers, threatened, action or
proceeding by any governmental authority for the assessment or collection
of income or other taxes. The United States federal income tax returns of
Seller have not been examined by the Internal Revenue Service ("the IRS").
Seller has paid all V.A.T. and other taxes due with respect to periods
prior to the Closing to the extent due and payable on or before the date
hereof. Buyer, Sellers and Stockholder will cooperate with each other in
the filing of all required tax returns of Sellers for all periods ending on
or prior to Closing.
4.14 Insurance. To the best knowledge of Stockholder and Sellers,
annexed hereto as Schedule 4.14 is a list containing a complete and correct
list and summary description of all policies of insurance relating to any
of the Purchased Assets, the Business or in which Sellers or Stockholder is
an insured party, beneficiary or loss payable payee. Such policies are in
full force and effect, all premiums due and payable with respect thereto
have been paid, and no notice of cancellation or termination has been
received by Sellers or Stockholder with respect to any such policy.
4.15 Banks; Powers of Attorney. Schedule 4.15 is a complete and
correct list showing (i) the names of each bank in which Sellers have an
account or safe deposit box and the names of all persons authorized to draw
thereon or who have access thereto, and (ii) the names of all persons, if
any, holding powers of attorney from Sellers or Stockholder with respect to
the Software Assets.
4.16 Employee Arrangements. To the best knowledge of Stockholder and
Sellers, Schedule 4.16 is a complete and correct list and summary
description of all (i) union, collective bargaining, employment,
management, termination and consulting agreements to which Sellers are a
party or otherwise bound, and (ii) compensation plans and arrangements;
bonus and incentive plans and arrangements; deferred compensation plans and
arrangements; pension and retirement plans and arrangements; profit-sharing
and thrift plans and arrangements; stock purchase and stock option plans
and arrangements; hospitalization and other life, health or disability
insurance or reimbursement programs; holiday, sick leave, severance,
vacation, tuition
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reimbursement, personal loan and product purchase discount policies and
arrangements; and other plans or arrangements providing for benefits for
employees of Sellers. Said Schedule also lists the names and compensation
of all employees of Seller whose earnings during the last fiscal year was
U.S.$50,000 or more (including bonuses and other incentive compensation),
and all employees who are expected to receive at least said amount in
respect of the present year.
4.17 Certain Business Matters. Except as is set forth in Schedule 4.17
neither Sellers nor the Purchased Assets are (a) a party to or bound by any
distributorship, dealership, sales agency, franchise or similar agreement
which relates to the sale or distribution of the Purchased Assets, (b) to
the best knowledge of Sellers and Stockholder, there are no pending, or to
the best of the knowledge of Sellers threatened, labor negotiations, work
stoppages or work slowdowns involving or affecting the Sellers' businesses,
and, to the best of the knowledge of Sellers, no union representation
questions exist, and there are no organizing activities, in respect of any
of the employees of Sellers, or (c) to the best knowledge of Sellers and
Stockholder, the product warranties given by Sellers, or Stockholder with
respect to the Existing Titles, or by which they are bound (complete and
correct copies or descriptions of which have heretofore been delivered by
Sellers and Stockholder to Buyer) entail no greater obligations than are
customary in the businesses of Sellers and Stockholder.
4.18 Certain Contracts. To the best knowledge of Sellers and
Stockholder, set forth on Schedule 4.18 is a complete and correct list of
all contracts, commitments, obligations and understandings which are not
set forth in any other Schedule delivered hereunder and to which the
Sellers are a party or otherwise bound, except for each of those which (a)
was made in the ordinary course of business, and (b) either (i) is
terminable by Sellers will be terminable by Buyer) without liability,
expense or other obligation on thirty (30) days' notice or less, or (ii)
may be anticipated to involve aggregate payments to or by Sellers or
Stockholder of $5,000 (or the equivalent) or less calculated over the full
term thereof, and (c) is not otherwise material to the Sellers' businesses.
Also set forth on Schedule 4.18 is a complete and correct list of
contracts, commitments, obligations and undertakings to which the Existing
Titles and UK Titles are subject. Except as set forth in the immediately
preceding sentence, there are no agreements or arrangements in effect with
respect to the marketing, distribution, licensing or promotion of the
Existing Titles and UK Titles by any independent salesperson, distributor,
sublicensor or other remarketer or sales organization. To the best
knowledge of Stockholder and Sellers, complete and correct copies of all
contracts, commitments, obligations and undertakings set forth on any of
the Schedules delivered pursuant to this Agreement have been furnished by
Sellers and Stockholder to Buyer or have been made available for Buyer's
inspection at
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Seller's offices, and except as expressly stated on the Schedule on which
they are set forth to the best of Seller's knowledge, (a) each of them is
in full force and effect, no person or entity which is a party thereto or
otherwise bound thereby is in default thereunder, and, to the best of the
knowledge of Sellers and Stockholder, no event, occurrence, condition or
act exists which does (or which with the giving of notice or the lapse of
time or both would) give rise to a default or right of cancellation,
acceleration or loss of contractual benefits thereunder; (b) there has been
no threatened cancellations thereof, and there are no outstanding disputes
thereunder; except, in any of the foregoing cases, where such default,
cancellation or the like (i) would not have a materially adverse effect on
the Business, the Sellers or the value of the Purchased Assets or (ii)
results from the change of control, transfer, sale and assignment effected
by the terms of the agreements identified on Schedule 1.3 by reason of the
Closing under this Agreement.
4.19 Approvals. Set forth on Schedule 4.19 hereto, is a complete and
correct list of all governmental and administrative consents, permits,
appointments, approvals, licenses, certificates and franchises which, to
Stockholder's knowledge, are necessary for the operation of the Sellers'
businesses, all of which have been obtained by Sellers and are in full
force and effect.
4.20 Business Practices and Commitments. Intentionally Omitted.
4.21 Brokers. No agent, broker, person, or firm acting on behalf of
Sellers or Stockholder, or under their respective authority, is or will be
entitled to a financial advisory fee, brokerage commission or other like
payment in connection with any of the transactions contemplated hereby
except for the fee payable by Stockholder to ▇▇▇▇▇▇ & Company.
4.22 Customers and Suppliers. Stockholder has previously provided to
Buyer, to the best of Stockholder's knowledge, a complete and correct list
setting forth, for each of GameTek and ART, for the twelve months ended
July 31, 1996 and July 31, 1997 (projected), (a) the 10 largest customers
of each Seller's businesses and the amount for which each such customer was
invoiced, and (b) the 10 largest suppliers of each Seller's businesses and
the amount of goods and services purchased from each such supplier. To the
Stockholder's knowledge, the aforesaid suppliers and customers will
continue their respective relationships with the Sellers after the Closing
Date on substantially the same basis as now exists.
4.23 Information as to Sellers and Stockholder. None of the
representations or warranties made by Sellers or Stockholder in this
Agreement or in any agreement executed and delivered by or on behalf of any
of them pursuant hereto are false or misleading with respect to any
material fact, or omit to
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state any material fact necessary in order to make the statements therein
contained not misleading.
4.24 Nature of Securities. Stockholder understands that as of the date
hereof (a) the Stock Consideration has not been registered under the
Securities Act of 1933, as amended (the "Act"), based upon an exemption
from such registration requirements; (b) the Stock Consideration to be
received is "restricted securities," as said term is defined in Rule 144 of
the General Rules and Regulations promulgated under the Act; (c) the Stock
Consideration to be received may not be sold or otherwise transferred
unless it has first been registered under the Act and applicable state
securities laws or an exemption from the registration provisions of the Act
and applicable state securities laws are available with respect to the
proposed sale or transfer; (d) the certificates evidencing the Stock
Consideration will bear a legend to the effect that the transfer thereof is
restricted; and (e) stop transfer instructions will be placed with the
transfer agent for the Stock Consideration.
4.25 Investment Representations. (i) Stockholder or its
representatives have received and carefully reviewed Buyer's registration
statement on Form SB-2 as declared effective by the Securities and Exchange
Commission (the "SEC") on April 14, 1997 and most recent Form 10-QSB, and
except for the foregoing and the representations and warranties contained
herein, Stockholder has not been furnished with any other materials or
literature relating to the Buyer or the Stock Consideration; (ii)
Stockholder or its representatives have had a reasonable opportunity to ask
questions of and receive answers from Buyer concerning Buyer and the Stock
Consideration.
4.26 As used herein, the terms "to the best of Stockholder's
knowledge", "to the best of Sellers' knowledge" or words of similar import
shall mean only the actual knowledge of ▇. ▇▇▇▇▇▇▇ Blue, Jr., ▇▇▇▇▇▇ ▇.
▇▇▇▇▇▇▇▇▇ III, J. ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇ or ▇▇▇ ▇▇▇▇▇▇▇▇.
5. Representations and Warranties as to Buyer. Buyer hereby represents and
warrants to Stockholder as follows:
5.1 Organization, Standing and Power. Buyer is a corporation duly
organized, validly existing and in good standing under the laws of the
State of Delaware, with full corporate power and authority to own, lease
and operate its properties and to carry on its business as presently
conducted by it.
5.2 Authority. The execution and delivery by Buyer of this Agreement
and of each agreement, document and instrument to be executed and delivered
by it pursuant hereto, the compliance by Buyer with the provisions hereof
and thereof, and the consummation of the transactions contemplated hereby
and
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thereby, have been duly and validly authorized by all necessary corporate
action on the part of Buyer, and Buyer has all necessary corporate power
with respect thereto. This Agreement is, and when executed and delivered by
Buyer each other agreement to be executed and delivered by it pursuant
hereto will be, the valid and binding obligation of Buyer in accordance
with its terms. Neither the execution and delivery by Buyer of this
Agreement or of any of the aforementioned other agreements, nor the
consummation of the transactions contemplated hereby or thereby, nor the
compliance by Buyer with the provisions hereof and thereof, will (nor with
the giving of notice or the lapse of time or both, would) conflict with or
result in a violation of any provision of the Certificate of Incorporation
or By-laws of Buyer, or in the breach of any material agreement to which
Buyer is a party or otherwise bound.
5.3 Securities and Exchange Commission Filings; Financial Statements.
Buyer has filed all forms, reports, statements and documents required to be
filed with the SEC since April 14, 1997, (collectively, the "SEC Reports"),
each of which has complied in all material respects with the applicable
requirements of the Act or the Exchange Act of 1934, as amended (the
"Exchange Act"), as applicable, each as in effect on the date so filed.
Buyer has delivered to the Stockholder, in the form filed with the SEC
(including any amendments thereto), (A) its Quarterly Report on Form 10-QSB
for the quarter ended April 30, 1997 (the "April 30 10-QSB") and (B) its
Prospectus dated April 14, 1997. None of such forms, reports or documents
(including but not limited to any financial statements or schedules
included or incorporated by reference therein) filed by the Buyer, when
filed (except to the extent revised or superseded by a subsequent filing
with the SEC) contained any untrue statement of a material fact or omitted
to state a material fact required to be stated or incorporated by reference
therein or necessary in order to make the statements therein, in light of
the circumstances under which they were made, not misleading. The financial
statements included in such forms were prepared in accordance with
generally accepted accounting principles consistently applied, and fairly
present the financial position of Buyer as at the dates thereof and its
results of operations for the periods indicated, except that any unaudited
financial statements are subject to normal reoccurring adjustments which
might be required as a result of year-end audits.
5.4 Capitalization. The authorized capital stock of Buyer consists of
15,000,000 shares of Common Stock and 5,000,317 shares of Preferred stock,
par value $.01 per share, of which, as of the date hereof, 7,847,455 shares
of Common Stock and 317 shares of preferred stock are issued and
outstanding. All issued shares of Buyer's Common Stock have been duly and
validly issued and are fully paid and nonassessable. Except as set forth in
the SEC Reports or the other documents specifically set forth in Schedule
5.4, there are no outstanding options, warrants, rights, puts, calls,
commitments, conversion rights,
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plans or other agreements of any character to which Buyer is a party or
otherwise bound which provide for the acquisition, disposition or issuance
of any issued but not outstanding, outstanding, or authorized and unissued
shares of Buyer Common Stock or preferred stock. There is no personal
liability, and there are no preemptive or similar rights, attached to
Buyer's Common Stock.
5.5 Absence of Changes. Since January 31, 1997, there have not been
(i) any material adverse changes in the condition (financial or otherwise),
assets, liabilities, business, prospects, or results of operations of Buyer
(including, without limitation, any such adverse change resulting from
damage, destruction or other casualty loss, whether or not covered by
insurance), (ii) any declarations, setting asides or payments of any
dividend or other distribution or payments in respect of the capital stock
of Buyer, or (iii) any changes in the accounting principles or methods
which are utilized by Buyer.
5.6 Litigation. Except as set forth in the SEC Reports, there are no
material suits or actions, or administrative, arbitration or other
proceedings or governmental investigations, pending or, to the best of the
knowledge of Buyer threatened, against or relating to Buyer. Except as set
forth in SEC Reports there are no material judgments, orders, stipulations,
injunctions, decrees or awards in effect which relate to Buyer, Buyer's
business or any of its assets, the effect of which is (A) to limit,
restrict, regulate, enjoin or prohibit any business practice in any area,
or the acquisition of any properties, assets or businesses, or (B)
otherwise to have a material adverse effect on the condition (financial or
otherwise), assets, liabilities, business, prospects or results of
operations of Buyer.
5.7 Information as to Buyer. None of the representations or warranties
made by Buyer in this Agreement or in any agreement executed and delivered
by or on behalf of it pursuant hereto are false or misleading with respect
to any material fact, or omit to state any material fact necessary in order
to make the statements therein contained not misleading.
6. Representations and Warranties as to Stock Consideration. Buyer
represents and warrants to the Stockholder that the Stock Consideration, when
issued, will be, (i) duly authorized and validly issued, fully paid and
non-assessable, (ii) delivered hereunder free and clear of any security
interests, pledges, mortgages, claims, liens and encumbrances of any kind
whatsoever except that the Stock Consideration will be "restricted securities"
as such term is defined in the rules and regulations of the Securities Exchange
Commission and will be subject to restrictions on transfers pursuant to such
rules and regulations and State laws, and (iii) issued in compliance with all
applicable federal and state securities laws.
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7. Indemnification.
7.1 Indemnification by Sellers and Stockholder. Sellers and
Stockholder hereby jointly and severally agree to indemnify and hold Buyer
harmless from and against any and all losses, obligations, deficiencies,
liabilities, claims, damages, costs and expenses (including, without
limitation, the amount of any settlement entered into pursuant hereto, and
all reasonable legal and other expenses incurred in connection with the
investigation, prosecution or defense of any matter indemnified pursuant
hereto) which Buyer may sustain, suffer or incur and which arise out of,
are caused by, relate to, or result or occur from or in connection with (i)
the Retained Liabilities, (ii) the noncompliance with any applicable bulk
transfer laws of any jurisdiction, or (iii) the breach by Sellers or
Stockholder of any representation, warranty or covenant made by it in this
Agreement or in any agreement or instrument executed and delivered pursuant
hereto.
7.2 Indemnification by Buyer. Buyer hereby agrees to indemnify and
hold Stockholder and its affiliates, other than Sellers, harmless from and
against any and all losses, obligations, deficiencies, liabilities, claims,
damages, costs and expenses (including, without limitation, the amount of
any settlement entered into pursuant hereto, and all reasonable legal and
other expenses incurred in connection with the investigation, prosecutor
defense of any matter indemnified pursuant hereto), which any of them may
sustain, suffer or incur and which arise out of, are caused by, relate to,
or result or occur from or in connection with (i) the Assumed Liabilities,
(ii) the breach by Buyer of any representation, warranty or covenant made
by it in this Agreement or in any agreement or instrument executed and
delivered pursuant hereto or (iii) Seller's Liabilities.
7.3 Third Party Claims. If a claim by a third party is made against
any party or parties hereto and the party or parties against whom said
claim is made intends to seek indemnification with respect thereto under
this paragraph 7, the party or parties seeking such indemnification shall
promptly notify the indemnifying party or parties, in writing, of such
claim; provided, however, that the failure to give such notice shall not
affect the rights of the indemnified party or parties hereunder unless such
failure materially and adversely affects the indemnifying party or parties.
The indemnifying party or parties shall have ten days after said notice is
given to elect, by written notice given to the indemnified party or
parties, to undertake, conduct and control, through counsel of their own
choosing (subject to the consent of the indemnified party or parties, such
consent not to be unreasonably withheld) and at their sole risk and
expense, the good faith settlement or defense of such claim, and the
indemnified party or parties shall cooperate with the indemnifying parties
in connection therewith; provided: (i) in the case of Sellers and/or
Stockholder as the indemnifying party or parties, it or they shall not
thereby
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permit to exist any lien, encumbrance or other adverse change upon any of
the Purchased Assets, Buyers or the Business, and (ii) the indemnified
party or parties shall be entitled to participate in such settlement or
defense through counsel chosen by the indemnified party or parties,
provided that the fees and expenses of such counsel shall be borne by the
indemnified party or parties. So long as the indemnifying party or parties
are contesting any such claim in good faith, the indemnified party or
parties shall not pay or settle any such claim; provided, however, that
notwithstanding the foregoing, the indemnified party or parties shall have
the right to pay or settle any such claim at any time, provided that in
such event they shall waive any right of indemnification therefor by the
indemnifying party or parties. If the indemnifying parties do not make a
timely election to undertake the good faith defense or settlement of the
claim as aforesaid, or if the indemnifying parties fail to proceed with the
good faith defense or settlement of the matter after making such election,
then, in either such event, the indemnified party or parties shall have the
right to contest, settle or compromise the claim at their exclusive
discretion, at the risk and expense of the indemnifying parties to the full
extent set forth in subparagraph 7.1 or 7.2 hereof, as the case may be.
7.4 Limitations Upon Indemnification. Buyer shall not have any right
to indemnification under this paragraph 7 or otherwise to recover damages
against Stockholder based upon the breach of a representation or warranty
by Sellers or Stockholder unless and until the amount of its claims is in
excess of $100,000.00 (the "Retained Indemnification") in the aggregate.
The obligation of Stockholder to indemnify or pay damages to Buyer for any
breach of representation or warranty shall apply only to the excess of the
aggregate amount of all such claims over $100,000.00. Buyer shall not be
entitled to assert as a defense, counterclaim or set-off against any
portion of the Purchase Price any claim for indemnification or damages, it
being the intention of the parties that Buyer's obligation to pay the
Purchase Price and perform under the Promissory Notes and the Registration
Rights Agreement be absolute and unconditional and that any claim for
indemnification or damages should be asserted by Buyer in a separate
action.
8. Miscellaneous Provisions.
8.1 Expenses. Except as otherwise provided in this Agreement,
Stockholder, on the one hand, shall pay its and Sellers' costs and expenses
and Buyer shall pay its own costs and expenses in connection with this
Agreement and the transactions contemplated hereby.
8.2 Execution in Counterparts. This Agreement may be executed in one
or more counterparts, and by the different parties hereto in separate
counterparts, each of which shall be deemed to be an original but all of
which taken together shall
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constitute one and the same agreement, and shall become effective when one
or more counterparts has been signed by each of the parties hereto and
delivered to each of the other parties hereto.
8.3 Notices. All notices, requests, demands and other communications
given hereunder shall be in writing and shall be deemed to have been duly
given: (i) on the date of delivery, if delivered personally or by
messenger, (ii) on the first business day following the date of timely
deposit with Federal Express or other nationally recognized overnight
courier service, if sent by such courier specifying next day delivery,
(iii) upon receipt of confirmation of transmission, if transmitted by
telecopier; and (iv) on the third business day after mailing, if mailed by
registered or certified mail (postage prepaid, return receipt requested);
provided, however, that a notice of change of address or telecopier number
shall not be deemed to have been given until actually received by the
addressee. All such notices, requests, demands and other communications
shall be addressed as set forth below or to such other address or
telecopier number as either party hereto may designate to the other party
hereto by like notice (except that a notice of change of address shall only
be effective upon receipt):
If to Buyer, to: Take Two Interactive Software
▇▇▇ ▇▇▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Attn: ▇▇▇▇ ▇. ▇▇▇▇▇
Copy to: ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇ LLP
23rd Floor
▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Attn: ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇
If to Stockholder, to: GameTek (FL), Inc.
▇/▇ ▇. ▇▇▇▇▇▇▇ ▇▇▇▇, ▇▇., ▇▇▇.
The Northern Blue Law Firm
▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇ ▇▇▇
▇▇▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇▇▇▇
▇▇▇▇▇-▇▇▇▇
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Copy to: ▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇ & ▇▇▇▇▇▇, LLP
▇▇▇ ▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇
▇▇▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Attn: ▇▇▇▇▇▇ ▇▇▇▇▇▇, Esq.
If to ART, to: Alternative Reality
Technologies, Inc.
▇/▇ ▇. ▇▇▇▇▇▇▇ ▇▇▇▇, ▇▇., ▇▇▇.
The Northern Blue Law Firm
▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇ ▇▇▇
▇▇▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇▇▇▇
▇▇▇▇▇-▇▇▇▇
If to GameTek, to: GameTek (UK) Limited
▇/▇ ▇. ▇▇▇▇▇▇▇ ▇▇▇▇, ▇▇., ▇▇▇.
The Northern Blue Law Firm
▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇ ▇▇▇
▇▇▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇▇▇▇
▇▇▇▇▇-▇▇▇▇
8.4 Amendment. This Agreement may only be amended by a written
instrument executed by each of the parties hereto.
8.5 Entire Agreement. This Agreement (together with the other
agreements and documents being delivered pursuant to or in connection with
this Agreement) constitutes the entire agreement of the parties hereto with
respect to the subject matter hereof, and supersedes all prior agreements
and understandings of the parties, oral and written, with respect to the
subject matter hereof, other than the Confidentiality Agreement which shall
remain in full force and effect.
8.6 Applicable Law. This Agreement shall be governed by the laws of
the State of New York applicable to contracts made and to be wholly
performed therein.
8.7 Headings. The headings contained herein are for the sole purpose
of convenience of reference, and shall not in any way limit or affect the
meaning or interpretation of any of the terms or provisions of this
Agreement.
8.8 Assignment. Neither this Agreement nor any rights, interests or
obligations hereunder may be assigned (by operation of law or otherwise) by
any party hereto without the prior written consent of all of the parties
hereto.
8.9 Binding Effect; Benefits. This Agreement shall inure to the
benefit of, and shall be binding upon, the
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parties hereto and their respective heirs, legal representatives,
successors and permitted assigns. Nothing herein contained, express or
implied, is intended to confer upon any person other than the parties
hereto and their respective heirs, legal representatives, successors and
permitted assigns, any rights or remedies under or by reason of this
Agreement.
8.10 Waiver, etc. The failure of any of the parties hereto to at any
time enforce any of the provisions of this Agreement shall not be deemed or
construed to be a waiver of any such provision, nor to in any way affect
the validity of this Agreement or any provision hereof or the right of any
of the parties hereto to thereafter enforce each and every provision of
this Agreement. No waiver of any breach of any of the provisions of this
Agreement shall be effective unless set forth in a written instrument
executed by the party or parties against whom or which enforcement of such
waiver is sought; and no waiver of any such breach shall be construed or
deemed to be a waiver of any other or subsequent breach.
8.11 Severability. Any provision of this Agreement which is held by a
court of competent jurisdiction to be prohibited or unenforceable in any
jurisdiction(s) shall be, as to such jurisdiction(s), ineffective to the
extent of such prohibition or unenforceability without invalidating the
remaining provisions of this Agreement or affecting the validity or
enforceability of such provision in any other jurisdiction.
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8.12 Announcements. No party hereto shall issue any press release or
otherwise make any public statement with respect to the existence of this
Agreement or the transactions contemplated hereby without the prior
approval of the other parties hereto, except as may be required by
applicable law or the applicable rules or regulations of any stock exchange
(upon reasonable prior written notice to the other party).
8.13 Schedules. The Schedules delivered pursuant to this Agreement are
an integral part hereof. Each such Schedule shall be in writing, shall
indicate the subparagraph pursuant to which it is being delivered, and
shall be initialled by the delivering party.
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IN WITNESS WHEREOF, this Agreement has been executed and delivered by the
parties hereto as of the date first above written.
Attest: TAKE TWO INTERACTIVE
SOFTWARE, INC.
By: /s/ ▇▇▇▇ ▇. ▇▇▇▇▇
---------------------------------
President
________________________________
Secretary
Attest: GAMETEK (FL), INC.
By: /s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇
---------------------------------
Authorized Signer
________________________________
Secretary
Attest: GAMETEK (UK), INC.
By: /s/ ▇▇▇▇▇ ▇▇▇▇▇▇
---------------------------------
President
________________________________
Secretary
Attest: ALTERNATIVE REALITY
TECHNOLOGIES, INC.
By: /s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇
---------------------------------
________________________________ Vice President
Secretary
SIGNATURE PAGE TO
ASSET AND STOCK PURCHASE AGREEMENT
AMONG GAMETEK (UK), LIMITED, GAMETEK (FL), INC,
ALTERNATIVE REALITY TECHNOLOGIES, INC. AND
TAKE TWO INTERACTIVE SOFTWARE, INC.
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TABLE OF CONTENTS
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1. Purchase and Sale Agreement............................................. 2
1.1 Agreement of Purchase and Sale................................ 2
1.2 Purchased Assets.............................................. 2
1.3 Assumed Liabilities........................................... 3
1.4 Purchase Price................................................ 4
2. Closing................................................................. 4
2.1 Closing Date.................................................. 4
2.2 Action by Buyer............................................... 4
2.3 Action by Stockholder......................................... 5
3. Additional Covenants.................................................... 6
3.1 Further Assurances............................................ 6
3.2 Confidentiality............................................... 6
3.3 Payment of Taxes Upon Transfer of Purchased
Assets.................................................... 6
3.4 Survival of Representations and Warranties.................... 6
3.5 Books and Records............................................. 7
3.6 Distribution and/or License Agreement......................... 7
3.7 Employment Agreement.......................................... 8
3.8 Discharge of Liens............................................ 8
3.9 Cancellation of Intercompany Indebtedness..................... 8
3.10 Retained Liabilities......................................... 8
3.11 Registration Rights.......................................... 8
4. Representations and Warranties as to Seller and
Stockholder........................................................ 9
4.1 Organization, Standing and Power.............................. 9
4.2 Capitalization................................................ 9
4.3 Interests in Other Entities................................... 10
4.4 Authority..................................................... 11
4.5 Noncontravention.............................................. 11
4.6 Financial Statements.......................................... 12
4.7 Absence of Undisclosed Liabilities............................ 13
4.8 Properties.................................................... 14
4.9 Litigation.................................................... 16
4.10 No Violation of Law.......................................... 16
4.12 Use of Name.................................................. 17
4.13 Intellectual Property........................................ 17
4.14 Tax Matters.................................................. 18
4.15 Insurance.................................................... 19
4.16 Banks; Powers of Attorney.................................... 20
4.17 Employee Arrangements........................................ 20
4.18 Certain Business Matters..................................... 21
4.19 Certain Contracts............................................ 21
4.20 Approvals.................................................... 22
4.21 Business Practices and Commitments........................... 23
4.22 Brokers...................................................... 23
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4.23 Customers and Suppliers...................................... 23
4.24 Information as to Sellers and Stockholder.................... 24
4.25 Nature of Securities......................................... 24
4.26 Investment Representations................................... 25
4.27 .......................................................... 25
5. Representations and Warranties as to Buyer.............................. 25
5.1 Organization, Standing and Power.............................. 25
5.2 Authority..................................................... 26
5.3 Securities a
nd Exchange Commission Filings;
Financial Statements...................................... 26
5.4 Capitalization................................................ 27
5.5 Absence of Changes............................................ 28
5.6 Litigation.................................................... 28
5.7 Information as to Buyer....................................... 29
6. Representations and Warranties.......................................... 29
7. Indemnification......................................................... 30
7.1 Indemnification by Sellers and Stockholder.................... 30
7.2 Indemnification by Buyer...................................... 30
7.3 Third Party Claims............................................ 31
7.4 Limitations Upon Indemnification.............................. 32
7.6 Validity of Transactions...................................... 33
7.7 .......................................................... 33
7.8 Performance of Agreements..................................... 34
7.9 .......................................................... 34
7.10 Expenses..................................................... 34
7.11 Execution in Counterparts.................................... 34
7.12 Notices...................................................... 34
7.13 Amendment.................................................... 36
7.14 Entire Agreement............................................. 36
7.15 Applicable Law............................................... 36
7.16 Headings..................................................... 36
7.17 Assignment................................................... 37
7.18 Binding Effect; Benefits..................................... 37
7.19 Waiver, etc.................................................. 37
7.20 Severability................................................. 38
7.21 Announcements................................................ 38
7.22 Schedules.................................................... 38
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