Exhibit 2.1
AGREEMENT AND PLAN OF MERGER AND REORGANIZATION
This Agreement and Plan of Merger and Reorganization (this "Agreement")
dated as of July 14, 2000, is by and among ▇▇▇▇▇▇ Corporation ("▇▇▇▇▇▇"), a
Delaware corporation; ▇▇▇▇▇▇ Merger Corporation ("Merger Sub"), a Delaware
corporation that is a wholly owned subsidiary of ▇▇▇▇▇▇; Lightspeed Electronics,
Inc. (the "Company"), a New York corporation; ▇▇▇▇▇▇ ▇▇▇▇▇▇ (the "Stockholder"),
an individual who is an officer and director and the sole stockholder of the
Company; and solely for purposes of Sections 8 and 9.2A hereof, ▇▇▇▇▇▇ ▇▇▇▇▇▇
(the "Director"), who is an honorary officer and a director of the Company.
The parties desire that Merger Sub be merged with and into the Company
(the "Merger"), subject to the terms and conditions set forth in this Agreement;
and for Federal income tax purposes, the parties intend and expect (but no party
represents, warrants, or undertakes) that the Merger will qualify as a
reorganization under the provisions of Section 368(a) of the United States
Internal Revenue Code of 1986, as amended (the "Code").
The parties agree as follows:
(Certain terms used in this Agreement are defined in Section 11.)
1. CLOSING. Upon execution and delivery of this Agreement, a closing
(the "Closing") will be held at the offices of ▇▇▇▇▇▇▇ ▇▇▇▇ LLP, ▇▇▇ ▇▇▇▇▇▇▇
▇▇▇▇▇▇, ▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇. At or before the Closing, Merger Sub and
the Company will execute certificates of merger (collectively, the "Merger
Certificates") substantially in the form of the attached Exhibits A-1 and A-2
and file them with the Delaware Secretary of State and the New York Department
of State in order to cause the Merger to be effected in accordance with the laws
of the States of Delaware and New York. The Merger will be effective upon the
filing of the Merger Certificates (the "Effective Time"). For all purposes, all
of the document deliveries and other actions to occur at the Closing will be
conclusively presumed to have occurred at the same time, immediately before the
Effective Time.
At the closing, ▇▇▇▇▇▇ and the Stockholder will enter into an
Employment Agreement in the form of the attached Exhibit B, and ▇▇▇▇▇▇ and the
Director will enter into a Consulting Agreement in the form of the attached
Exhibit C. The Stockholder will also deliver to ▇▇▇▇▇▇ evidence of the
termination of the Sales Representative Agreement dated as of October 1, 1999,
between the Company and Technical Development Company, and all rights and
obligations thereunder.
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2. EFFECT OF MERGER. At the Effective Time, automatically and without
further action:
2.1. SURVIVING CORPORATION. Merger Sub will be merged with and into the
Company and the separate existence of the Company will cease. Merger Sub will
continue in existence as the surviving corporation in the Merger (the "Surviving
Corporation"). The effect of the Merger will be as provided in the applicable
provisions of this Agreement, the Delaware General Corporation Law, and the New
York Business Corporation Law, including that all of the respective properties,
rights, privileges, powers, and franchises of Merger Sub and the Company will
vest in the Surviving Corporation, and all of the respective debts, liabilities,
and duties of Merger Sub and the Company will become the debts, liabilities, and
duties of the Surviving Corporation.
2.2. CERTIFICATE OF INCORPORATION AND BY-LAWS. Merger Sub's certificate
of incorporation and by-laws, respectively, as in effect immediately before the
Effective Time, will be the certificate of incorporation and by-laws of the
Surviving Corporation.
2.3. DIRECTORS AND OFFICERS. From and after the Effective Time, the
respective officers and members of the Board of Directors of the Surviving
Corporation will consist of those persons named as such in the Merger
Certificates, each such person to hold office, subject to the applicable
provisions of the certificate of incorporation and the by-laws of the Surviving
Corporation, until the next annual meeting of directors or stockholders, as the
case may be, of the Surviving Corporation and until his successor is duly
elected or appointed and qualified.
2.4. CONVERSION OF COMPANY STOCK. The shares of Company Stock issued
and outstanding immediately before the Effective Time will be converted into and
become the right to receive (i) an aggregate of 100,000 shares of ▇▇▇▇▇▇ Stock
(collectively, the "Consideration Shares"), and (ii) any Earn-Out Payments that
may become due pursuant to Section 3 hereof (collectively, such shares of ▇▇▇▇▇▇
Stock and Earn-Out Payments, the "Merger Consideration").
2.5. CONVERSION OF MERGER SUB'S SHARES. Each share of the common stock,
$0.001 par value per share, of Merger Sub that was issued and outstanding
immediately before the Effective Time will be converted into and become one
share of the common stock, $0.001 par value, of the Surviving Corporation.
3. EARN-OUT.
3.1. CERTAIN DEFINITIONS. As used in this Section 3:
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"Lightspeed Products" means (i) the Company's Model DC60 microwave
oscilloscope product and any improved versions thereof with an analog bandwidth
of greater than 10 gigahertz; (ii) sampling pods and derivatives of the
Company's Model DC60 microwave oscilloscope product with analog bandwidth of
greater than 10 gigahertz; and (iii) options and accessories sold specifically
for use with the products described in the preceding clauses (i) and (ii) (such
as clock sources, pseudo-random pattern generators, trigger adaptors,
amplifiers, connectors, attentuators, cable assemblies, and software specific to
such products).
Without expanding the foregoing definition, Lightspeed Products do NOT
include (i) third-party products (regardless of how bundled, packaged, or
branded, and regardless of whether sold in combination with or in support of
Company's Model DC60 microwave oscilloscope product) such as optical receivers,
probes, filters, frequency sources, computers, software, and other additions and
options to the Company's Model DC60 microwave oscilloscope product; (ii) ▇▇▇▇▇▇
products listed in ▇▇▇▇▇▇'▇ Test & Measurement Price List dated April 1, 2000,
including improved, successor, and derivative products, and all ▇▇▇▇▇▇ Research
Instrumentation Products, including components, custom integrated circuits,
hybrids, CAMAC, NIM, FASTBUS, VME, and legacy research products; and (iii)
revenue or income from royalties and licenses, custom software, development
contracts, repairs, and calibration.
"Net Sales" means the aggregate actual sales prices invoiced by ▇▇▇▇▇▇
and its subsidiaries and sublicensees to third parties for Lightspeed Products
shipped on or before June 30, 2005 (excluding transfers between or among ▇▇▇▇▇▇
and such subsidiaries and sublicensees), minus (i) rebates, discounts, and other
direct sales incentives, (ii) taxes and other governmental charges (other than
income taxes), (iii) costs of transportation, including shipping, insurance,
etc., and (iv) amounts credited in respect of returns and allowances.
3.2. EARN-OUT PAYMENTS. ▇▇▇▇▇▇ will make payments ("Earn-Out Payments")
to the Stockholder equal to 7% of Net Sales, as follows. Subject to the
following sentence, within 90 days after the end of each fiscal year of ▇▇▇▇▇▇
ending on or before June 30, 2005, ▇▇▇▇▇▇ will remit to the Stockholder the full
amount of Earn-Out Payments payable in respect of Net Sales during that fiscal
year, together with a written report showing in reasonable detail the
calculation of the amount of Earn-Out Payments remitted. Notwithstanding the
foregoing or any other provision of this Agreement, the maximum aggregate
Earn-Out Payments payable by ▇▇▇▇▇▇ will be $800,000.
3.3. AUDIT RIGHTS. ▇▇▇▇▇▇ will keep accurate records in sufficient
detail to enable the Earn-Out Payments payable by it hereunder to be determined,
and will not dispose of such records for at least one year after the end of the
fiscal year to which they relate. The Stockholder will be permitted to have an
independent accounting firm of his own selection examine any Earn-Out report
submitted by ▇▇▇▇▇▇ within six months after the date it is received by the
Stockholder. Upon reasonable prior notice, ▇▇▇▇▇▇ will make all records
pertinent to the verification of the report being examined available to the
Stockholder's accounting firm during normal business hours at the locations
where such records are customarily kept. The Stockholder will cause its
accounting firm to maintain the confidentiality of all information obtained in
the course of such examination. Any such examination by the Stockholder's
accountants will be at the Stockholder's expense, except that if the examination
of any Earn-Out report reveals an underpayment by ▇▇▇▇▇▇ of more than 10% of the
Earn-Out Payments actually due and owing in respect of the period covered by
that report, then ▇▇▇▇▇▇ will be responsible for the reasonable costs of such
examination.
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4. EXCHANGE OF CERTIFICATES. After the Effective Time, stock
certificates ("Certificates") representing shares of Company Stock that have
been converted into Merger Consideration will be conclusively deemed to
represent only such Merger Consideration. At the Closing, the Stockholder will
surrender all Certificates to ▇▇▇▇▇▇ in exchange for a certificate representing
the Consideration Shares.
5. REGISTRATION OF ▇▇▇▇▇▇ STOCK. Within 30 days following the Closing,
▇▇▇▇▇▇ will file with the United States Securities and Exchange Commission a
registration statement (the "Registration Statement") on Form S-3 or other
appropriate form for the purpose of registering for resale by the Stockholder
all of the Consideration Shares. Thereafter, ▇▇▇▇▇▇ will use its best reasonable
efforts to cause the Registration Statement to become effective as promptly as
practicable and to remain effective until the earlier of (i) the first
anniversary of the Effective Date, or (ii) such time at which all of the
Consideration Shares have been resold pursuant to the Registration Statement or
otherwise.
Within 30 days following the Closing, ▇▇▇▇▇▇ will also prepare and
submit to the National Association of Securities Dealers, Inc. a listing
application covering the Consideration Shares, and will use its best reasonable
efforts to cause such shares to be approved for listing in the NASDAQ National
Market, subject to official notice of issuance.
6. REPRESENTATIONS AND WARRANTIES OF THE STOCKHOLDER.
The Stockholder hereby represents and warrants to ▇▇▇▇▇▇ as follows,
subject in each case to such exceptions as are specifically contemplated by this
Agreement or as are set forth in the attached Disclosure Schedule.
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Each exception set forth in the Disclosure Schedule will be deemed to
qualify each representation and warranty set forth in this Agreement (i) that is
specifically identified in the Disclosure Schedule as being qualified by such
exception, or (ii) with respect to which the relevance of such exception is
apparent on the face of the disclosure of such exception set forth in the
Disclosure Schedule; provided, in either case, that the relevant facts are set
forth in reasonable detail in the Disclosure Schedule.
6.1. INCORPORATION; AUTHORITY. The Company is a corporation duly
organized, validly existing, and in good standing under the laws of the State of
New York and has all requisite corporate power and authority to own or lease and
operate its properties and to carry on its business as now conducted. The
Stockholder has delivered to ▇▇▇▇▇▇ complete and correct copies of the Company's
certificate of incorporation and by-laws, in each case with all amendments
thereto, which certificate of incorporation and by-laws are in full force and
effect.
6.2. AUTHORIZATION AND ENFORCEABILITY. Each of the Company and the
Stockholder has all requisite power and full legal right and authority (in the
Company's case, including due approval of its Board of Directors and its sole
stockholder, respectively) to enter into this Agreement, to perform all of its
or his agreements and obligations hereunder, and to consummate the Merger and
the other transactions contemplated hereby. This Agreement has been duly
executed and delivered by each of the Company and the Stockholder and
constitutes a legal, valid, and binding agreement of each of them, enforceable
against each of them in accordance with its terms, except as enforceability may
be subject to the effect of any applicable bankruptcy, insolvency, fraudulent
conveyance, moratorium, reorganization, marshaling, or other similar laws or
rules of law affecting creditors' rights and remedies generally, and to general
principles of equity.
6.3. GOVERNMENTAL AND OTHER THIRD-PARTY CONSENTS, NON-CONTRAVENTION,
ETC. Except for the filing of the Merger Certificates, no consent, approval, or
authorization of or registration, designation, declaration, or filing with any
governmental authority, federal or other, or any other person, is required on
the part of the Company or the Stockholder in connection with the execution,
delivery, and performance of this Agreement or the consummation of the Merger
and the other transactions contemplated hereby. The execution, delivery, and
performance of this Agreement and the consummation of such transactions will not
violate (a) any provision of the Company's certificate of incorporation or
by-laws, (b) any order, judgment, injunction, award or decree of any court or
state or federal governmental or regulatory body applicable to the Company or
the Stockholder, or (iii) any judgment, decree, order, statute, rule,
regulation, agreement, instrument, or other obligation to which the Company or
the Stockholder is a party or by or to which either of them or any of their
respective assets is bound or subject.
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6.4. CAPITALIZATION. The authorized and outstanding capital stock and
other securities of the Company are as set forth in Section 6.4 of the
Disclosure Schedule, and the Company does not have outstanding any other
securities. All of the outstanding shares of capital stock of the Company are
duly authorized, validly issued, fully paid, and non-assessable, are owned of
record and beneficially by the Stockholder, and were issued in compliance with
all applicable laws, including securities laws, and all applicable preemptive or
similar rights of any person. No person has any valid right to rescind any
purchase of the Company's capital stock or other securities.
There are no agreements or other obligations to which the Company is a
party or by which it is bound to purchase or sell and no convertible or
exchangeable securities, options, warrants, or other rights to acquire from the
Company any capital stock or other securities.
6.5. SUBSIDIARIES. The Company does not have any subsidiaries or own
any legal and/or beneficial interests in or to any other business enterprise or
other person.
6.6. PROPERTIES AND ASSETS. The Company has good and marketable title
or leasehold title, as the case may be, to all of its assets and properties that
it purports to own or lease, including all those reflected in Section 6.6 of the
Disclosure Schedule, all free and clear of Liens. All such properties and assets
are in good condition and repair, reasonable wear-and-tear excepted, and are
adequate to carry on the business of the Company as presently conducted. Section
6.6 of the Disclosure Schedule sets forth a complete and correct list of all
assets of the Company having a book or fair market value in excess of $5,000 as
of the date hereof.
The Company does not own any real property. Section 6.6 of the
Disclosure Schedule sets forth a complete and correct description of all leases
of real property to which the Company is a party. Complete and correct copies of
all such leases have been delivered to ▇▇▇▇▇▇.
6.7. INTELLECTUAL PROPERTIES.
(a) Section 6.7 of the Disclosure Schedule lists all patents, patent
applications, trademarks, trade names, service marks, logos, registered
copyrights, and licenses that are material to the businesses of the Company as
now being conducted, other than licenses by the Company as licensee of
off-the-shelf software programs that have not been customized for its use
(collectively, and together with all unregistered copyrights, technology,
know-how, trade secrets, processes, formulas, and techniques that are material
to the Company's businesses, the "Intellectual Properties"). The Company owns,
or is licensed or otherwise has the full and unrestricted exclusive right to
use, all Intellectual Properties without the payment of royalties or other
further consideration, and no other intellectual property rights, privileges,
licenses, contracts, or other agreements, instruments, or evidences of interests
are material to the conduct of the businesses of the Company.
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(b) In any instance where the Company's rights to Intellectual
Properties arise under a license or similar agreement (other than for
off-the-shelf software programs that have not been customized for its use), this
is indicated in Section 6.7 of the Disclosure Schedule and such rights by their
terms are licensed exclusively to the Company except as indicated in Section 6.7
of the Disclosure Schedule. No other person has an interest in or right or
license to use any of the Intellectual Properties purported to be owned by the
Company, or to the best of the Stockholder's knowledge, any of the Intellectual
Properties that by their terms are exclusively licensed to the Company. To the
best of the Stockholder's knowledge, none of the Intellectual Properties is
being infringed by others, or is subject to any outstanding order, decree,
judgment, or stipulation. No litigation (or other proceedings in or before any
court or other governmental, adjudicatory, arbitral, or administrative body)
relating to any of the Intellectual Properties purported to be owned by the
Company, or to the best of the Stockholder's knowledge, any of the Intellectual
Properties that by their terms are exclusively licensed to the Company, is
pending (as evidenced by the Company's receipt of service of process or other
written notice of such pendency), or to the best of the Stockholder's knowledge,
threatened, nor, to the best of the Stockholder's knowledge, is there any basis
for any such litigation or proceeding. The Company maintains reasonable security
measures for the preservation of the secrecy and proprietary nature of such of
its Intellectual Properties as constitute trade secrets or other confidential
information.
(c) To the best of the Stockholder's knowledge, neither the Company nor
the Stockholder has infringed or made unlawful use of, or is infringing or
making unlawful use of, any intellectual property or other proprietary or
confidential information of any other person. The activities of the Stockholder
and the Company's other current and past employees and contractors in connection
with their employment or contractual relationships with the Company did not and
do not violate any agreements or arrangements with any former employer or other
person. No litigation (or other proceedings in or before any court or other
governmental, adjudicatory, arbitratory, or administrative body) charging the
Stockholder or the Company with infringement or unlawful use of any patent,
trademark, service ▇▇▇▇, trade name, logo, copyright, trade secret, or other
proprietary right is pending, or to the best of the Stockholder's knowledge,
threatened; nor, to the best of the Stockholder's knowledge, is there any basis
for any such litigation or proceeding.
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(d) The Stockholder is not obligated under or bound by any agreement or
instrument, or any judgment, decree, or order of any court of administrative
agency, that (i) conflicts or may conflict with his agreements and obligations
to use his best efforts to promote the interests of the Company, (ii) conflicts
or may conflict with the business or operations of the Company, or (iii)
restricts or may restrict the use or disclosure of any information that may be
useful to the Company.
(e) It is understood and agreed that the Stockholder does not hereby
represent or warrant that the Stockholder's pending patent application for
"Waveform Translator for DC to 75 GHz Oscillography" will result in an issued
patent, or even that the invention described in such application is patentable;
but does represent and warrant that all rights, titles, and interests in and to
such patent application and invention have been effectively assigned to and are
owned by the Company.
6.8. NO UNDISCLOSED LIABILITIES. Except as disclosed in Section 6.8 of
the Disclosure Schedule, the Company does not have any liabilities or
obligations of any nature, whether accrued, absolute, contingent, or otherwise
(including liabilities, as guarantor or otherwise, in respect of obligations of
others), including in respect of matters that are the subject of other or more
specific representations and warranties set forth in this Agreement.
6.9. TAXES.
(a) FILING OF TAX RETURNS AND PAYMENT OF TAXES. The Company has timely
filed all Tax Returns required to be filed by it, each such Tax Return has been
prepared in compliance with all applicable laws and regulations, and all such
Tax Returns are true and accurate in all respects. All Taxes due and payable by
the Company have been paid, and the Company will not be liable for any
additional Taxes in respect of any taxable period ending on or before the date
of the Closing in an amount that exceeds the corresponding reserve therefor, if
any, reflected in the accounting records of the Company. The Stockholder has
delivered to ▇▇▇▇▇▇ correct and complete copies of all Tax Returns filed by or
with respect to the Company, and all relevant documents and information with
respect thereto, including examination reports and statements of deficiencies
assessed against or agreed to by the Company or the Stockholder.
(b) AUDIT HISTORY. No taxing authority has ever audited or notified the
Company or the Stockholder of an intention to audit any Tax Return of the
Company.
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(c) DEFICIENCIES. No deficiency or proposed adjustment in respect of
Taxes that has not been settled or otherwise resolved has been asserted or
assessed by any taxing authority against the Company.
(d) LIENS. There are no Liens for Taxes (other than current Taxes not
yet due and payable) on the assets of the Company.
(e) EXTENSIONS TO STATUTE OF LIMITATIONS FOR ASSESSMENT OF TAXES. The
Company has not consented to extend the time in which any Tax may be assessed or
collected by any taxing authority.
(f) EXTENSIONS OF THE TIME FOR FILING TAX RETURNS. The Company has not
requested or been granted an extension of the time for filing any Tax Return.
(g) PENDING PROCEEDINGS. There is no action, suit, taxing authority
proceeding, or audit with respect to any Tax now in progress, pending, or to the
best of the Stockholder's knowledge, threatened, against or with respect to (i)
the Company, or (ii) any Affiliated Group with respect to a taxable period
during which the Company was a member of such Affiliated Group.
(h) NO FAILURES TO FILE TAX RETURNS. No claim has ever been made by a
taxing authority in a jurisdiction where the Company does not pay Tax or file
Tax Returns that the Company is or may be subject to Taxes assessed by such
jurisdiction.
(i) MEMBERSHIP IN AFFILIATED GROUPS, ETC. The Company has never been a
member of any Affiliated Group, or filed or been included in a combined,
consolidated, or unitary Tax Return.
(j) TAX SHARING, ALLOCATION, OR INDEMNITY AGREEMENTS. The Company is
not a party to or bound by any Tax sharing or allocation agreement or has any
current or potential contractual obligation to indemnify any other person with
respect to Taxes.
(k) WITHHOLDING TAXES. The Company has withheld and paid all Taxes
required to have been withheld and paid by it in connection with amounts paid or
owing to any employee, creditor, independent contractor, or other person.
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6.10. EMPLOYEE BENEFIT PLANS.
(a) Except as described in Section 6.10 of the Disclosure Schedule, the
Company does not now maintain or contribute to, and has not in the current or
preceding six calendar years maintained or contributed to, any pension,
profit-sharing, deferred compensation, bonus, stock option, share appreciation
right, severance, group or individual health, dental, medical, life insurance,
survivor benefit, or similar plan, policy, or arrangement, whether formal or
informal, for the benefit of any director, officer, consultant or employee,
whether active or terminated, of the Company. Each of the arrangements set forth
in Section 6.10 of the Disclosure Schedule is hereinafter referred to as an
"Employee Benefit Plan," except that any such arrangement that is a
multi-employer plan will be treated as an Employee Benefit Plan only for
purposes of Sections 6.10(d)(iv), (vi), and (viii) and 6.10(g) below.
(b) The Stockholder has delivered to ▇▇▇▇▇▇ copies of each Employee
Benefit Plan, and with respect to each such plan (i) any associated trust,
custodial, insurance, or service agreements, (ii) any annual report, actuarial
report, or disclosure materials (including specifically any summary plan
descriptions) submitted to any governmental agency or distributed to
participants or beneficiaries thereunder in the current or any of the six
preceding calendar years, and (iii) the most recently received Internal Revenue
Service ("IRS") determination letters and any governmental advisory opinions or
rulings.
(c) Each Employee Benefit Plan is and has heretofore been maintained
and operated in compliance with the terms of such plan and with the requirements
prescribed (whether as a matter of substantive law or as necessary to secure
favorable tax treatment) by any and all statutes, governmental or court orders,
and governmental rules or regulations in effect from time to time, including but
not limited to the Employee Retirement Income Security Act of 1974, as amended
("ERISA") and the Code and applicable to such plan. Each Employee Benefit Plan
that is intended to qualify under Section 401(a) of the Code and each trust
forming part of an Employee Benefit Plan which is intended to qualify under
Section 501(c)(9) of the Code is specifically so identified in Section 6.10 of
the Disclosure Schedule and has been determined by the IRS to be so qualified,
and to the best of the Stockholder's knowledge, nothing has occurred since the
date of the last such determination as to each such plan or trust that has
resulted or is likely to result in the revocation of such determination as to
such plan or trust.
(d) (i) There is no pending, or to the best of the Stockholder's
knowledge, threatened, legal action, proceeding, or investigation, other than
routine claims for benefits, concerning any Employee Benefit Plan, or to the
best of the Stockholder's knowledge, any fiduciary or service provider thereof,
and to the best of the Stockholder's knowledge, there is no basis for any such
legal action, proceeding, or investigation.
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(ii) No liability (contingent or otherwise) to the Pension
Benefit Guaranty Corporation ("PBGC") or any multi-employer plan has been
incurred by the Company or any of its ERISA affiliates (other than insurance
premiums satisfied in due course).
(iii) No reportable event, or event or condition that presents
a material risk of termination by the PBGC, has occurred with respect to any
Employee Benefit Plan, or any retirement plan of an ERISA affiliate of the
Company, which is subject to Title IV of ERISA.
(iv) No Employee Benefit Plan nor any party in interest with
respect thereof, has engaged in a prohibited transaction that could subject the
Company directly or indirectly to liability under Section 409 or 502(i) of ERISA
or Section 4975 of the Code.
(v) No communication, report, or disclosure has been made
that, at the time made, did not reflect accurately in all material respects the
terms and operations of any Employee Benefit Plan.
(vi) No Employee Benefit Plan provides welfare benefits
subsequent to termination of employment to employees or their beneficiaries
(except to the extent required by applicable state insurance laws and Title I,
Part 6 of ERISA), other than (A) coverage mandated by applicable law, (B)
benefits the full cost of which is borne by the current or former employees (or
their beneficiaries), and (C) benefits that have already been satisfied in full.
(vii) No benefits due under any Employee Benefit Plan have
been forfeited subject to the possibility of reinstatement (which possibility
would still exist at or after the Closing) except as required by applicable law.
(viii) The Company has not undertaken to maintain any Employee
Benefit Plan for any period of time and each such Plan is terminable at the sole
discretion of the Company, subject only to such constraints as may be imposed by
applicable law.
(e) There is no Employee Benefit Plan for which a separate fund of
assets is or is required to be maintained.
(f) The execution of this Agreement and the consummation of the
transactions contemplated hereby will not result in any payment (whether of
severance pay or otherwise) becoming due from any Employee Benefit Plan to any
current or former director, officer, consultant, or employee of the Company or
result in the vesting, acceleration of payment, or increases in the amount of
any benefit payable to or in respect of any such current or former director,
officer, consultant, or employee. (No representation or warranty is made as to
the foregoing with respect to actions taken by ▇▇▇▇▇▇ after the Closing with
respect to the Employee Benefit Plans.)
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(g) No Employee Benefit Plan is a multi-employer plan.
(h) For purposes of this Section 6.10, "multi-employer plan," "party in
interest," "current value," "accrued benefit," "reportable event," and "benefit
liability" have the same meaning assigned such terms under Sections 3, 4043(b)
or 4001(a) of ERISA, and "ERISA affiliate" means any entity that under Section
414 of the Code is treated as a single employer with the Company.
6.11. SAFETY AND ENVIRONMENTAL MATTERS.
(a) None of the plants, offices, or properties in or on which the
Company carries on business nor any of the activities carried on by it are in
violation of any zoning, health, or safety law or regulation, including the
Occupational Safety and Health Act of 1970, as amended.
(b) Neither the Company, nor to the best of the Stockholder's
knowledge, any operator of any real property presently or formerly owned,
leased, or operated by the Company has violated or allegedly violated or is in
violation or alleged violation of any judgment, decree, order, law, license,
rule, or regulation pertaining to environmental matters.
6.12. LABOR RELATIONS. The Company is and has been in compliance in all
material respects with all federal and state laws respecting employment and
employment practices, terms and conditions of employment, wages and hours, and
nondiscrimination in employment, and is not and has not been engaged in any
unfair labor practice. There is no charge or proceeding pending, or to the best
of the Stockholder's knowledge, threatened, against the Company alleging
unlawful discrimination in employment practices or unfair labor practice before
any court or agency, including the National Labor Relations Board.
6.13. LITIGATION. No litigation, arbitration, action, suit, proceeding,
or investigation (whether conducted by any judicial or regulatory body,
arbitrator, or other person) is pending, or to the best of the Stockholder's
knowledge, threatened, against the Company, nor is there any basis therefor
known to the Stockholder.
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6.14. CONTRACTS. Section 6.14 of the Disclosure Schedule sets forth a
complete and accurate list of all agreements of any kind, written or oral, that
are legally enforceable by or against or otherwise binding on the Company. All
of such agreements are in full force and effect, and neither the Company, nor to
the best of the Stockholder's knowledge, any other party thereto, is in default
under or material breach thereof, nor does any event or condition exist that
after notice or lapse of time or both could constitute a default thereunder or
material breach thereof on the part of the Company, or to the best of the
Stockholder's knowledge, any other party thereto. No approval or consent of any
person that has not already been obtained and is listed in Section 6.14 of the
Disclosure Schedule is needed in order that such agreements continue in full
force and effect following the consummation of the Merger and the other
transactions contemplated hereby, and no such agreement includes any provision,
the effect of which may be to terminate (or give rise to a right of termination
under) such contract, to enlarge or accelerate any obligations of the Company
thereunder, or to give additional rights to any other person, as a result of the
consummation of the Merger or the other transactions contemplated hereby. The
Stockholder has delivered to ▇▇▇▇▇▇ copies of all such agreements, including all
amendments, modifications, and supplements thereto.
6.15. INSURANCE. Section 6.15 of the Disclosure Schedule lists the
policies of theft, fire, liability, worker's compensation, life, property and
casualty, and other insurance owned or held by the Company. All such policies
are in full force and effect; are sufficient for compliance by the Company with
all requirements of law and of all contractual obligations of the Company; are
valid, outstanding, and enforceable policies and provide that they will remain
in full force and effect through the respective dates set forth in the
Disclosure Schedule; and will not in any way be affected by, or terminate or
lapse as a result of the consummation of, the Merger and the other transactions
contemplated by this Agreement.
6.16. BANK ACCOUNTS, SIGNING AUTHORITY, POWERS OF ATTORNEY. Section
6.16 of the Disclosure Schedule sets forth a complete and accurate list of all
bank, brokerage, and other accounts, and all safe-deposit boxes, of the Company,
and all persons with signing or other authority to act with respect thereto or
to borrow money or sign notes on behalf of the Company.
6.17. PERSONNEL. The names and compensation of each employee and
independent contractor of the Company are as set forth in Section 6.17 of the
Disclosure Schedule.
6.18. BROKERS. No finder, broker, agent, or other intermediary has
acted for or on behalf of the Company or the Stockholder in connection with the
negotiation, preparation, execution, or delivery of this Agreement or the
consummation of the Merger or the other transactions contemplated hereby.
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6.19. COMPLIANCE WITH OTHER AGREEMENTS, LAWS, ETC. The Company has
complied with, and is in compliance with, (a) all laws, statutes, governmental
regulations and all judicial or administrative tribunal orders, judgments,
writs, injunctions, decrees or similar commands applicable to its business, (b)
all unwaived terms and provisions of all agreements to which the Company is a
party, or to which the Company or any of its properties is subject, and (c) its
certificate of incorporation and by-laws, respectively, each as amended to date.
The Company has not been charged with, or to the best of its knowledge, been
under investigation with respect to, any violation of any provision of any
federal, state, or local law or administrative regulation. The Company has and
maintains (and Section 6.19 of the Disclosure Schedule sets forth a complete and
correct list of) all such licenses, permits, and other authorizations of
governmental authorities as are necessary for or material to the conduct of its
businesses or in connection with the ownership or use of its properties, all of
which are in full force and effect, copies of all of which have previously been
delivered to ▇▇▇▇▇▇, and except as described in Section 6.19 of the Disclosure
Schedule, none of which will terminate or otherwise be adversely affected as a
result of the consummation of the Merger and the other transactions contemplated
hereby.
6.20. INVESTMENT REPRESENTATIONS.
(a) ACCREDITATION; INVESTMENT INTENT. The Stockholder is acquiring the
Consideration Shares for his own account, for investment only, and not with a
view to, or for sale in connection with, any distribution of the Consideration
Shares in violation of the Securities Act, any rule or regulation thereunder, or
any applicable state securities laws.
(b) INFORMATION. The Stockholder has had the opportunity to ask
questions of and receive answers from the officers of ▇▇▇▇▇▇ and has received
copies of or access to LeCroy's SEC Reports (as defined in Section 7.5) and such
other information with respect to LeCroy's business, financial condition,
affairs, and prospects as he has deemed necessary or desirable in connection
with his acquisition of the Consideration Shares.
(c) SOPHISTICATION. The Stockholder has sufficient experience in
business, financial, and investment matters to be able to evaluate the relative
merits and risks involved in his acquisition of the Consideration Shares and to
make an informed investment decision with respect to such acquisition.
(d) ABILITY TO BEAR RISK. The Stockholder can afford a complete loss of
his investment in the Consideration Shares and is able to bear the economic risk
of holding the Consideration Shares for an indefinite period.
(e) RESTRICTED SECURITIES. The Stockholder understands that (i) the
Consideration Shares have not been registered under the Securities Act or any
other applicable securities laws, and are "restricted securities" within the
meaning of Rule 144 under the Securities Act, (ii) the Consideration Shares
cannot be sold, transferred, or otherwise disposed of unless they are
subsequently registered under the Securities Act and other applicable securities
laws, or unless exemptions from such registration requirements are available,
and (iii) any certificate representing the Consideration Shares will bear a
restrictive legend referring to the restrictions on transfer imposed by
applicable securities laws.
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6.21. DISCLOSURE. No representation or warranty of the Stockholder of
the Company in this Agreement (including the exhibits and schedules hereto) or
in any other agreement, instrument, certificate, or other document delivered by
either of them in connection with this Agreement, the Merger, or any of the
other transactions contemplated hereby 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 therein or necessary to make the statements contained
therein not false or misleading.
6A. ASSIGNMENT OF INVENTIONS. The Stockholder hereby assigns,
transfers, and delivers to the Company all rights, titles, and interests in and
to all inventions, improvements, discoveries, developments, processes, software,
mask works, and works of authorship, whether patentable or copyrightable or not,
and all related intellectual property rights, that were created, made,
conceived, or reduced to practice by the Stockholder or under his direction or
by him jointly with others, up to and including the date of this Agreement,
excluding only such of these things as do not relate in any way to any business
in which the Company or any of its subsidiaries has or is engaged (collectively,
subject to such exclusion, all of the foregoing, "Inventions"). If requested by
▇▇▇▇▇▇, the Stockholder will assist it to apply for and obtain any patents or
copyright registrations relating to any Inventions, and will execute and deliver
to ▇▇▇▇▇▇ all related applications and other documents, all at LeCroy's expense.
The Stockholder hereby appoints ▇▇▇▇▇▇ (with power of substitution) as his agent
and attorney-in-fact to execute and deliver or file any such document in his
name and on his behalf. This power of attorney is irrevocable and coupled with
an interest on the part of ▇▇▇▇▇▇.
7. REPRESENTATIONS AND WARRANTIES OF ▇▇▇▇▇▇ AND MERGER SUB.
▇▇▇▇▇▇ and Merger Sub hereby jointly and severally represent and
warrant to the Stockholder as follows:
7.1. INCORPORATION; AUTHORITY. Each of ▇▇▇▇▇▇ and Merger Sub is a
corporation duly organized, validly existing, and in good standing under the
laws of the State of Delaware and has all requisite corporate power and
authority to own or lease and operate its properties and to carry on its
business as now conducted.
7.2. AUTHORIZATION AND ENFORCEABILITY. Each of ▇▇▇▇▇▇ and Merger Sub
has all requisite power and full legal right and authority (including due
approval of its Board of Directors and (if necessary) its stockholder(s),
respectively) to enter into this Agreement, to perform all of its agreements and
obligations hereunder, and to consummate the Merger and the other transactions
contemplated hereby. This Agreement has been duly executed and delivered by each
of ▇▇▇▇▇▇ and Merger Sub and constitutes a legal, valid, and binding obligation
of each of them, enforceable against each of them in accordance with its terms,
except as enforceability may be subject to the effect of any applicable
bankruptcy, insolvency, fraudulent conveyance, moratorium, reorganization,
marshaling, or other similar laws or rules of law affecting creditors' rights
and remedies generally, and to general principles of equity.
-16-
7.3. GOVERNMENTAL AND OTHER THIRD-PARTY CONSENTS, NON-CONTRAVENTION,
ETC. Except for the filing of the Merger Certificates and the NASDAQ listing
application referred to in Section 5, no consent, approval, or authorization of
or registration, designation, declaration, or filing with any governmental
authority, federal or other, or any other person, is required on the part of
▇▇▇▇▇▇ or Merger Sub in connection with this Agreement, the Merger, or any of
the other transactions contemplated hereby. The execution, delivery, and
performance of this Agreement and the consummation of such transactions will not
violate (a) any provision of LeCroy's or Merger Sub's Certificate of
Incorporation or by-laws, (b) any order, judgment, injunction, award or decree
of any court or state or federal governmental or regulatory body applicable to
▇▇▇▇▇▇ or Merger Sub, or (iii) any judgment, decree, order, statute, rule,
regulation, agreement, instrument, or other obligation to which ▇▇▇▇▇▇ or Merger
Sub is a party or by or to which either of them or any of their respective
assets is bound or subject.
7.4. MERGER SUB. Merger Sub has been organized for the specific purpose
of engaging in the Merger and the other transactions contemplated hereby and has
not incurred any material liabilities, conducted any material business, or
entered into any material contracts or commitments, in each case except such as
are in furtherance of or incidental to such transactions.
7.5. LECROY'S SEC STATEMENTS, REPORTS AND DOCUMENTS. ▇▇▇▇▇▇ has
delivered or made available to the Stockholder copies of (i) its Annual Report
on Form 10-K for its fiscal year ended June 30, 1999, (ii) its proxy statement
relating to its most recent annual meeting of its stockholders, and (iii) all
other forms, reports (including annual reports pursuant to Exchange Act rule
14a-3), registration statements, and documents filed or required to be filed by
it with, or provided or required to be provided by it to, the SEC since the
filing of its Annual Report on Form 10-K referred to above (collectively, all of
the foregoing documents, "LeCroy's SEC Reports"). As of their respective dates,
LeCroy's SEC Reports complied in all material respects with all applicable
requirements of the Securities Act and the Exchange Act and the rules and
regulations promulgated thereunder, and did not contain any untrue statement of
a material fact or omit to state a material fact required to be stated therein
or necessary to make the statements therein, in light of the circumstances under
which they were made, not misleading. None of LeCroy's SEC Reports is required
to be amended or supplemented as of the date hereof. The financial statements
(including any related notes) of ▇▇▇▇▇▇ included in LeCroy's SEC Reports were
prepared in conformity with generally accepted accounting principles applied on
a consistent basis (except as otherwise stated in the financial statements or,
in the case of audited statements, the related report of LeCroy's independent
certified public accountants) and present fairly in all material respects the
consolidated financial position, results of operations, changes in stockholders'
equity, and cash flows, as applicable, of ▇▇▇▇▇▇ and its consolidated
subsidiaries as of the dates and for the periods indicated; subject, in the case
of unaudited interim consolidated financial statements, to condensation, the
absence of footnote disclosure, and normal, recurring end-of-period adjustments,
the effect of which was not and will not be material.
-17-
7.6. BROKERS. No finder, broker, agent, or other intermediary has acted
for or on behalf of ▇▇▇▇▇▇ or Merger Sub in connection with the negotiation,
preparation, execution, or delivery of this Agreement or the consummation of the
transactions contemplated hereby.
7.7. DISCLOSURE. No representation or warranty of ▇▇▇▇▇▇ or Merger Sub
in this Agreement (including the exhibits and schedules hereto) or in any other
agreement, instrument, certificate, or other document delivered by ▇▇▇▇▇▇ and/or
Merger Sub in connection with this Agreement, the Merger, or any of the other
transactions contemplated hereby 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 therein or necessary to make the statements contained therein not false
or misleading.
8. COVENANTS. Each of the Stockholder and the Director severally
covenants as follows:
8.1. CONFIDENTIAL INFORMATION. Each of the Stockholder and the Director
will maintain the confidentiality of all confidential, sensitive, or proprietary
information of the Company and the Surviving Corporation, including with respect
to its businesses, finances, affairs, and technology, which will be and remain
the exclusive property of the Surviving Corporation; and unless previously
authorized in writing by ▇▇▇▇▇▇, and except with respect to information that has
otherwise become public through no action or omission on his part, he will not
disclose any such information to any third party, or use it for any purpose
other than (if applicable) in the discharge of his employment or consulting
responsibilities in the ordinary course of the Surviving Corporation's business.
8.2 NON-COMPETITION, ETC. For a period of five years after the Closing
(which period will automatically be extended by a period of time equal to any
period in which he is in breach of any obligations under this Section 8.2 or
Sections 8.3 or 8.4 hereof; including any such extension, the "Restricted
Period"), neither the Stockholder nor the Director will engage, directly or
indirectly (except as a stockholder, director, officer, consultant, and/or
employee of ▇▇▇▇▇▇ and/or the Surviving Corporation), in the Restricted Business
or any other business presently being conducted by the Company, whether as a
proprietor, equityholder, investor (except as a passive investor holding not
more than 1% of the outstanding capital stock of a publicly held company),
lender, partner, director, officer, employee, consultant, or representative, or
in any other capacity.
-18-
8.3. NON-SOLICITATION OF EMPLOYEES, ETC. During the Restricted Period,
neither the Stockholder nor the Director will directly or indirectly recruit,
solicit, induce, or attempt to induce any of the employees or independent
contractors of ▇▇▇▇▇▇ or any of its subsidiaries (including the Surviving
Corporation) to terminate their employment or contractual relationship with
▇▇▇▇▇▇ or its subsidiary; and neither the Stockholder nor the Director will
assist any other person to do so, or be a proprietor, equityholder, investor
(except as a passive investor holding not more than 1% of the capital stock of a
publicly held company), lender, partner, director, officer, employee,
consultant, or representative of any person who does or attempts to do so.
8.4. NON-SOLICITATION OF CUSTOMERS, SUPPLIERS, ETC. During the
Restricted Period, neither the Stockholder nor the Director will directly or
indirectly solicit, divert, take away, or attempt to divert or take away, from
▇▇▇▇▇▇ or any of its subsidiaries (including the Surviving Corporation) any of
the business or patronage of any of their respective customers, clients,
accounts, vendors, or suppliers, or induce or attempt to induce any such person
to reduce the amount of business it does with ▇▇▇▇▇▇ or any of its subsidiaries;
and neither the Stockholder nor the Director will assist any other person to do
so, or be a proprietor, equityholder, investor (except as a passive investor
holding not more than 1% of the capital stock of a publicly held company),
lender, partner, director, officer, employee, consultant, or representative of
any person who does or attempts to do so.
8.5. EQUITABLE REMEDIES. Each of the Stockholder and the Director
hereby acknowledges that any breach by him of his obligations under this Section
8 would cause substantial and irreparable damage to ▇▇▇▇▇▇ and the Surviving
Corporation, and that money damages would be an inadequate remedy therefor, and
accordingly, acknowledges and agrees that each of ▇▇▇▇▇▇ and the Surviving
Corporation will be entitled to an injunction, specific performance, and/or
other equitable relief to prevent the breach of such obligations (in addition to
all other rights and remedies to which they may be entitled in respect of any
such breach).
-19-
8.6. MODIFICATION. In the event that a court of competent jurisdiction
determines that any of the provisions of this Section 8 would be unenforceable
as written because they cover too extensive a geographic area, too broad a range
of activities, or too long a period of time, or otherwise, then such provisions
will automatically be modified to cover the maximum geographic area, range of
activities, and period of time as may be enforceable, and in addition, such
court is hereby expressly authorized so to modify this Agreement and to enforce
it as so modified. No invalidity or unenforceability of any section of this
Agreement or any portion thereof will affect the validity or enforceability of
any other section or of the remainder of such section.
9. INDEMNIFICATION.
9.1. INDEMNIFICATION BY ▇▇▇▇▇▇ AND THE SURVIVING CORPORATION. ▇▇▇▇▇▇
and the Surviving Corporation, jointly and severally, will indemnify, defend,
and hold harmless the Stockholder from and against any and all Damages related
to or arising, directly or indirectly, out of or in connection with:
(a) any breach by ▇▇▇▇▇▇ or Merger Sub of any representation,
warranty, covenant, agreement, obligation, or undertaking made by
either of them in this Agreement (including any schedule or exhibit
hereto), or any other agreement, instrument, certificate, or other
document delivered by or on behalf of either of them in connection with
this Agreement, the Merger, or any of the other transactions
contemplated hereby; and
(b) any untrue statement (or alleged untrue statement) of any
material fact contained in the Registration Statement, any preliminary
or final prospectus contained therein, any amendment or supplement
thereto, or any document incorporated by reference therein, or any
omission (or alleged omission) to state therein any material fact
required to be stated therein or necessary to make the statements
therein, in light of the circumstances in which they were made, not
misleading, or any violation by ▇▇▇▇▇▇, in connection with the
Registration Statement, of the Securities Act or any rule or regulation
promulgated thereunder; provided, however, that ▇▇▇▇▇▇ will not be
liable in any such case to the extent that any such Damages arise out
of or are based on any untrue statement or omission made in reliance
upon and in conformity with written information furnished by the
Stockholder for use in the Registration Statement.
9.2. INDEMNIFICATION BY THE STOCKHOLDER. The Stockholder will
indemnify, defend, and hold harmless ▇▇▇▇▇▇ and the Surviving Corporation, from
and against any and all Damages related to or arising, directly or indirectly,
out of or in connection with:
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(a) any breach by the Stockholder or the Company of any
representation, warranty, covenant, agreement, obligation, or
undertaking made by the Stockholder or the Company in this Agreement
(including any schedule or exhibit hereto), or any other agreement,
instrument, certificate, or other document delivered by or on behalf of
either of them in connection with this Agreement, the Merger, or any of
the other transactions contemplated hereby; and
(b) any untrue statement (or alleged untrue statement) of any
material fact contained in the Registration Statement, any preliminary
or final prospectus contained therein, any amendment or supplement
thereto, or any document incorporated by reference therein, or any
omission (or alleged omission) to state therein any material fact
required to be stated therein or necessary to make the statement
therein, in light of the circumstances in which it was made, not
misleading, but only if and to the extent that such statement or
omission was made in reliance upon and in conformity with information
furnished by such Stockholder for use in the Registration Statement;
provided, that the Stockholder's liability with respect to the
Registration Statement will be limited to an amount equal to the gross
proceeds of sale (before deduction of any selling expenses) of the
securities sold by the Stockholder pursuant to the Registration
Statement.
9.2A. INDEMNIFICATION BY THE DIRECTOR. The Director will indemnify,
defend, and hold harmless ▇▇▇▇▇▇ and the Surviving Corporation, from and against
any and all Damages related to or arising, directly or indirectly, out of or in
connection with any breach by the Director of any covenant, agreement,
obligation, or undertaking made by the Director in Section 8 of this Agreement.
9.3. CLAIMS. In the event that any party hereto (the "Indemnified
Party") desires to make a claim against another party hereto (the "Indemnifying
Party," which term includes all indemnifying parties if more than one) in
connection with any third-party litigation, arbitration, action, suit,
proceeding, claim, or demand at any time instituted against or made upon it for
which it may seek indemnification hereunder (a "Third-Party Claim"), the
Indemnified Party will promptly notify the Indemnifying Party of such
Third-Party Claim and of its claims of indemnification with respect thereto,
provided, that failure to give such notice will not relieve the Indemnifying
Party of its indemnification obligations under this section except to the
extent, if any, that the Indemnifying Party has actually been prejudiced
thereby. Upon receipt of such notice from the Indemnified Party, the
Indemnifying Party will be entitled to assume the defense of such Third-Party
Claim, with authority to negotiate, compromise, and settle such Third-Party
Claim, provided, that the Indemnifying Party will not agree to any settlement of
such Third-Party Claim that does not include an unconditional release of all
liability of each Indemnified Party with respect to such Third-Party Claim.
-21-
The Indemnified Party will retain the right to employ its own counsel
and to participate in the defense of any Third-Party Claim, the defense of which
has been assumed by an Indemnifying Party pursuant hereto, but the Indemnified
Party will be responsible for its own expenses in connection with such
participation, except that if the Indemnified Party reasonably determines that
an irreconcilable conflict of interest make separate representation of the
Indemnified Party's by separate counsel advisable, then the Indemnifying Party
will be responsible for the reasonable cost of one such separate counsel.
9.4. CONTRIBUTION IN LIEU OF INDEMNIFICATION. If the indemnification
provided for in Section 9.1(b) or 9.2(b) is unavailable to, or insufficient to
hold harmless, a party that would have been an Indemnified Party in respect of
any Damages referred to therein, then each Indemnifying Party will, in lieu of
indemnifying such Indemnified Party, contribute to the amount paid or payable by
such Indemnified Party as a result of such Damages in such proportion as is
appropriate to reflect their relative fault in connection with the statements or
omissions that resulted in such Damages. Relative fault will be determined by
reference to, among other things, whether the untrue or alleged untrue statement
of a material fact or the omission or alleged omission to state a material fact
relates to information supplied by the Indemnifying Party or the Indemnified
Party and the parties' relative intent, knowledge, access to information and
opportunity to correct or prevent such statement or omission. The parties agree
that it would not be just and equitable if contribution pursuant to this Section
9.4 were determined by pro rata allocation or by any other method of allocation
that does not take account of the equitable considerations referred to above in
this Section 9.4. No person guilty of fraudulent misrepresentation (within the
meaning of Section 11(f) of the Securities Act) will be entitled to contribution
from any person who was not guilty of such fraudulent misrepresentation.
10. RELEASES. The Stockholder, for himself and his heirs, legatees,
successors, and assigns, hereby fully and irrevocably releases, remises, and
discharges the Surviving Corporation from any and all Damages, regardless of
whether known, unknown, or unknowable, and regardless of whether absolute,
contingent, or otherwise, and regardless of whether at law, in equity, or
otherwise, without limitation, whether now existing or arising in the future, in
each case to the extent based on actions, omissions, and/or events occurring at
or before the Effective Time, including all rights to indemnification and/or
contribution, but excluding Damages and rights of indemnification arising
expressly under this Agreement and claims for accrued but unpaid salaries and
reimbursable expenses (the aggregate amount of which salaries and expenses does
not exceed $5,000). Furthermore, the Stockholder hereby irrevocably agrees not
to ▇▇▇, or to commence, maintain, or aid in the prosecution of any litigation,
arbitration, or other action or proceeding against or adverse to the Surviving
Corporation, or otherwise to seek any recourse against the Surviving
Corporation, in respect of any matter hereby released or purported or attempted
to be released.
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11. DEFINITIONS. As used in this Agreement, the following terms have
the following respective meanings:
"Affiliated Group" has the meaning ascribed to it in Section 1504 of
the Code, and in addition includes any analogous combined, consolidated, or
unitary group, as defined under any applicable state, local, or foreign income
Tax law.
"Company Stock" means the Company's Common Stock, no par value.
"copy" or "copies" (regardless of whether capitalized) refer to true,
correct, and complete copies of the indicated document.
"Damages" means all damages, losses, claims, demands, actions, causes
of action, suits, litigations, arbitrations, liabilities, costs, and expenses,
including court costs and the reasonable fees and expenses of legal counsel.
"Exchange Act" means the Securities Exchange Act of 1934, as amended,
and the rules and regulations of the SEC thereunder, as in effect as of the
relevant time of reference.
"including" (regardless of whether capitalized) means including without
limitation.
"knowledge" (regardless of whether capitalized) includes both actual
knowledge and the knowledge that the indicated person would have after
conducting a reasonable investigation.
"▇▇▇▇▇▇ Stock" means the Common Stock, $0.01 par value, of ▇▇▇▇▇▇.
"Liens" means any and all liens, claims, mortgages, security interests,
pledges, options, rights of first offer or refusal, charges, encumbrances,
limitations on voting rights, and restrictions on transfer of any kind, except,
in the case of references to securities, those arising under applicable
securities laws solely by reason of the fact that such securities were issued
pursuant to exemptions from registration under such securities laws.
"person" (regardless of whether capitalized) means any natural person,
entity, or association, including any corporation, partnership, limited
liability company, government (or agency or subdivision thereof), trust, joint
venture, or proprietorship.
-23-
"Restricted Business" means the design, development, manufacture, sale,
license, or servicing of hardware or software (including firmware) for:
(i) analog and/or digital oscilloscopes;
(ii) other instruments for the acquisition, display, and/or
analysis of electrical and optical waveforms, including spectrum
analyzers, network analyzers, jitter/time-interval analyzers,
modulation analyzers, transmission quality analyzers, communication
signal analyzers, and other measurement instruments with and without
display, including bench-top embodiments, embedded systems, modules,
hybrids, and integrated circuits (including so-called "systems on a
chip"); and/or
(iii) options and accessories for the devices and products
referred to in the preceding clauses (i) and (ii), including optical
and electrical probes (including active, passive, differential,
voltage, current, and power probes), optical and electrical signal
sources, pattern generators, trigger adaptors, amplifiers, filters,
converters, and all types of interconnect devices.
"SEC" means the United States Securities and Exchange Commission.
"Securities Act" means the Securities Act of 1933, as amended, and the
rules and regulations of the SEC thereunder, as in effect as of the relevant
time of reference.
"Tax" or "Taxes" means any federal, state, local, or foreign income,
gross receipts, franchise, estimated, alternative minimum, add-on minimum,
sales, use, transfer, registration, value added, excise, natural resources,
severance, stamp, occupation, premium, windfall profit, environmental, customs,
duties, real property, personal property, capital stock, intangibles, social
security, unemployment, disability, payroll, license, employee, or other tax or
levy, of any kind whatsoever, including any interest, penalties, or additions to
tax in respect of the foregoing.
"Tax Return" means any return, declaration, report, claim for refund,
information return, or other document (including any related or supporting
estimates, elections, schedules, statements, or information) filed or required
to be filed in connection with the determination, assessment, or collection of
any Tax or the administration of any laws, regulations, or administrative
requirements relating to any Tax.
-24-
12. GENERAL.
12.1. COOPERATION. Each of the parties will cooperate with the others
and use its best reasonable efforts to prepare all necessary documentation, to
effect all necessary filings, and to obtain all necessary permits, consents,
approvals, and authorizations of all governmental bodies and other third parties
necessary to consummate the transactions contemplated by this Agreement.
12.2. SURVIVAL OF PROVISIONS. The terms of this Agreement, including
the representations and warranties of the parties, and the provisions of the
other documents executed and delivered in connection with this Agreement, the
Merger, and the other transactions contemplated hereby will be deemed material,
and, notwithstanding any investigation by or on behalf of any other party, will
be deemed to have been relied on by each other party, and will survive the
Closing and the consummation of the Merger and the other transactions
contemplated hereby. Each party represents and warrants that he or it has NOT
relied on any statement made or allegedly made by any other party or his or its
agents or representatives (whether in writing, orally, or otherwise) in
connection with the transactions contemplated hereby other than as set forth in
this Agreement and the other documents executed and delivered in connection with
this Agreement.
12.3. EXPENSES. ▇▇▇▇▇▇, on the one hand, and the Stockholder, on the
other, each will be responsible for and will pay all of its or his own expenses
in connection with the negotiation and preparation of this Agreement and the
consummation of the Merger and the other transactions contemplated hereby; and
no expenses in connection with such transactions will be charged by the
Stockholder to the Company.
12.4. BENEFITS OF AGREEMENT; NO ASSIGNMENTS; NO THIRD-PARTY
BENEFICIARIES. This Agreement will bind and inure to the benefit of the parties
hereto and their respective heirs, successors, and permitted assigns. No party
will assign any rights or delegate any obligations hereunder without the consent
of the other parties, and any attempt to do so will be void. Nothing in this
Agreement is intended to or will confer any rights or remedies on any person
other than the parties hereto and their respective heirs, successors, and
permitted assigns.
12.5. ABOUT THIS AGREEMENT. This Agreement may be executed by the
parties in separate counterparts, each of which when so executed and delivered
will be an original, but all of which together will constitute one and the same
agreement. In pleading or proving this Agreement, it will not be necessary to
produce or account for more than one such counterpart.
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The language used in this Agreement is the language chosen by the
parties to express their mutual intent, and no rule of strict construction will
be applied against any party. The captions of sections or subsections of this
Agreement are for reference only and will not affect the interpretation or
construction of this Agreement.
12.6. WAIVERS. No waiver of any breach or default hereunder will be
valid unless in a writing signed by the waiving party. No failure or other delay
by any party exercising any right, power, or privilege hereunder will be or
operate as a waiver thereof, nor will any single or partial exercise thereof
preclude any other or further exercise thereof or the exercise of any other
right, power, or privilege.
12.7. ENTIRE AGREEMENT. This Agreement, together with the exhibits and
schedules hereto and the other agreements, instruments, certificates, and other
documents referred to herein as having been or to be executed and delivered in
connection with the transactions contemplated hereby, contains the entire
understanding and agreement among the parties, and supersedes any prior
understandings or agreements among them, or between or among any of them, with
respect to the subject matter hereof.
12.8. GOVERNING LAW. This Agreement will be governed by and interpreted
and construed in accordance with the internal laws of the State of New York, as
applied to contracts made, and entirely to be performed, within New York, and
without reference to principles of conflicts or choice of laws.
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Executed and delivered under seal as of the date first above written.
▇▇▇▇▇▇: ▇▇▇▇▇▇ CORPORATION
By
-------------------------------
Name:
Title:
MERGER SUB: ▇▇▇▇▇▇ MERGER CORPORATION
By
-------------------------------
Name:
Title:
COMPANY: LIGHTSPEED ELECTRONICS, INC.
By
-------------------------------
Name:
Title:
STOCKHOLDER: -------------------------------
▇▇▇▇▇▇ ▇▇▇▇▇▇
DIRECTOR: -------------------------------
▇▇▇▇▇▇ ▇▇▇▇▇▇
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EXHIBITS AND SCHEDULES
EXHIBITS
A-1 and A-2 Merger Certificates
B Employment Agreement with ▇▇▇▇▇▇ ▇▇▇▇▇▇
C Consulting Agreement with ▇▇▇▇▇▇ ▇▇▇▇▇▇
SCHEDULES
Disclosure Schedule