ASSET PURCHASE AGREEMENT
ASSET PURCHASE AGREEMENT DATED AS OF MARCH 31, 1999 BY AND BETWEEN
HYCOMP, INC. OF ▇▇▇ ▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇ (THE
'SELLER') AND HYCOMP ACQUISITION CORP., C/O SATCON TECHNOLOGY CORPORATION, ▇▇▇
▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇ (THE 'PURCHASER'), with reference
to the following RECITALS:
A. Seller is in the business of manufacturing of hybrid circuits, thin
film circuits and flip chip assembly;
B. Purchaser wishes to purchase certain equipment and other assets
which are used by Seller in its business operations, and Seller
desires to sell such assets.
NOW THEREFORE, in consideration of the recitals and of the respective covenants,
representations, warranties, and agreements herein contained, and intending to
be legally bound hereby, the parties hereby agree as follows:
1. PURCHASE AND SALE
1.1. AGREEMENT TO SELL. At the Closing hereunder (as defined
in Section 2.1) and except as specifically provided in Section 1.3, Seller
shall grant, sell, convey, assign, transfer and deliver to Purchaser, all
right, title and interest of Seller in and to (a) all of the tangible and
intangible assets of Seller including those more fully identified in Section
1.2, (b) the name "HyComp" to the extent of the ownership rights of Seller,
if any, and all of the good will associated therewith; all of which shall be
free and clear of all mortgages, liens, pledges, security interests, charges,
claims, restrictions and encumbrances of any nature whatsoever (collectively
the "Assets").
1
1.2 INCLUDED ASSETS. The Assets shall include, without
limitation, the following assets, properties and rights of the Seller, except
as otherwise set forth in Section 1.3 hereof.
(a) all machinery, equipment, tools, furniture, furnishings,
leasehold improvements, goods and other tangible personal
property owned by Seller, and shown on Schedule 1.2(a).
(b) all prepaid items as shown on Schedule 1.2(b).
(c) all supplies, raw materials, work in process, finished goods
and other inventory as shown on Schedule 1.2(c).
(d) all right title, and interest of the Seller in and to all
purchase orders as shown on Schedule 1.2(d).
(e) all of Seller's right, title and interest in and to the name
"HyComp", to the extent of the ownership rights of Seller, if
any, subject to the terms of Section 1.3(e) hereinafter;
(f) all rights under any trademark, service ▇▇▇▇, trade name or
copyright, whether registered or unregistered, and any
applications therefore;
(g) all technologies, methods, formulations, data bases, trade
secrets, know-how, inventions, and other intellectual property
used in Seller's business or under development;
(h) all information, files, records, data, plans, contracts and
recorded knowledge including customer and supplier lists,
related to the foregoing.
2
1.3 EXCLUDED ASSETS. Notwithstanding the foregoing the
Assets shall not include any of the following (the 'Excluded
Assets'):
(a) the corporate seal, Articles of Organization, minute
books, stock books, tax returns, books of account,
accounting records or other records of Seller;
(b) any cash in any of Seller's bank accounts or in transit
other than cash received by the Sellers on or after
April 1, 1999 with respect to receivables that arise on
and after April 1, 1999, which Seller shall remit to
Buyer promptly after the receipt thereof in accordance
with that certain letter executed today between Buyer
and Seller;
(c) any accounts receivable of Seller as shown on Schedule
1.3(c) other than accounts receivables which arose on
and after April 1, 1999;
(d) any intercompany receivables of Seller as shown on
Schedule 1.3(d);
(e) the legal entity, public entity of HyComp, Inc. or its
capital stock.
It is agreed that Seller, although selling the name "HyComp"
herewith, may continue to use the name "HyComp" in connection with
the corporation HyComp, Inc. so long as such corporation does not
actively conduct business under such name. At such time as Seller
may dissolve its corporate entity it shall retain no further right
to the use of the name "HyComp".
3
1.4 ASSUMPTION OF LIABILITY. At the Closing hereunder the
Purchaser shall assume and agree to pay, discharge or perform, as
appropriate, the following liabilities and obligations the Seller (the
"Assumed Liabilities"):
(a) all liabilities and obligations of Seller identified on
Schedule 1.4(a). All liabilities shall be paid promptly by Purchaser and
in all events within the period in which each liability is due.
(b) [Intentionally Omitted];
(c) all liabilities under the purchase orders set forth in
Schedule 1.4(c);
(d) all taxes of Purchaser accruing subsequent to the
Closing Date (as defined in Section 2.1);
Purchaser shall not at the Closing assume or agree to
perform, pay or discharge, and Seller shall remain
unconditionally liable for, all obligations, liabilities
and commitments, fixed or contingent, of Seller
(including without limitation, intercompany accounts
payable and notes payable to lenders), other than the
Assumed Liabilities (such liabilities, obligations and
commitments shall hereinafter be referred to as "Seller
Liabilities").
(e) Liability under warranty for all rework and monetary
payments to the extent that in the aggregate, for all
such liabilities and payments shall be less than
$25,000.00.
1.5 AGREEMENT TO PURCHASE. At the Closing, Purchaser shall
purchase the Assets from Seller in exchange for the purchase price
payable
4
under Section 1.6 and the assumption of liabilities and obligations of
Seller to the extent and as provided in Section 1.4 of this Agreement.
1.6 PURCHASE PRICE. As consideration for the Assets, Purchaser
shall deliver to Seller at the Closing:
(a) payment to the Seller of $750,000.00 by delivery of a
certified check or by wire transfer completed and with
funds immediately available as of the time of Closing
(the 'Closing Payment');
(b) The Purchaser shall pay to Seller a royalty of 5% of all
sales made to customers of Seller who are not also
customers as of the Closing Date, of Purchaser
('Eligible Customers') for a period of 52 weeks (the
"Royalty Period") subsequent to the Closing date. The
Eligible Customers are those identified on Schedule
1.6(b) annexed hereto. During the Royalty Period,
Purchaser shall provide to Seller at least quarterly
such records as Seller may reasonably require to account
for all such sales to Eligible Customers. Payment shall
be made by Purchaser to Seller after receipt of payment
from Eligible Customers by Purchaser on a quarterly
basis.
(c) Amounts identified on Schedule 1.4(a) to be paid at
Closing, shall be paid at Closing.
1.7 [Intentionally Omitted]
1.8 NOTIFICATION TO CUSTOMERS. Purchaser shall make timely
notification in writing to all customers of Seller giving notice of
Purchaser's purchase of assets pursuant to this agreement, such
notification to be made no later than two (2) weeks after the Date of
Closing.
5
2. CLOSING.
2.1 TIME AND PLACE OF CLOSING. The closing (the "Closing") of the
sale and purchase of the Assets shall take place at 12:00 P.M., Monday,
April 12, 1999 (the "Closing Date") at the offices of ▇▇▇▇ and ▇▇▇▇ LLP,
▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇ or at such other time as may
be mutually agreed upon by Purchaser and Seller.
2.2 ITEMS TO BE DELIVERED AT CLOSING.
(a) Purchaser shall deliver to Seller:
(i) The Closing Payment;
(ii) A certificate of vote evidencing approval of the
transactions contemplated herein; and
(iii) Such other documents as Seller may reasonably require;
(b) Seller shall deliver to Purchaser:
(i) A ▇▇▇▇ of sale in customary form;
(ii) A certificate of vote evidencing approval of the
transactions contemplated herein;
(iii) Such legal opinions from Seller's counsel as Purchaser
shall reasonably request; and
(iv) Such other documents as Purchaser may reasonably
require.
2.3 DELIVERY OF POSSESSION. At the Closing Seller shall put
Purchaser in possession and operating control of the Assets, including but
not limited to all purchase orders, contracts, licenses, customer lists
and all other
6
documents, books, records, files, data and property that are part of the
Assets. Seller shall execute and deliver such further documents and
instruments as Purchaser shall reasonably request from time to time in
order to cause full possession and control of the Assets to be transferred
and delivered to Purchaser.
3. REPRESENTATIONS AND WARRANTIES OF SELLER
Seller represents and warrants to Purchaser as follows:
3.1 CORPORATE EXISTENCE. Seller is a corporation duly
organized, validly existing and in good standing under the laws of the
Commonwealth of Massachusetts.
3.2 CORPORATE POWER; AUTHORIZATION; ENFORCEABLE OBLIGATION.
seller has the corporate power, authority and legal right to execute,
deliver and perform this Agreement. The execution, delivery and
performance of this Agreement by Seller have been duly authorized by all
necessary corporate action. This Agreement has been, and the other
agreements, documents and instruments required to be delivered by Seller
in accordance with the provisions hereof ("Seller's Documents") will be,
duly executed and delivered by Seller and this Agreement constitutes, and
Seller's Documents when executed and delivered will constitute, the
legal, valid and binding obligations of Seller, enforceable against
Seller in accordance with their respective terms.
3.3 VALIDITY OF CONTEMPLATED TRANSACTIONS, ETC. The
execution, delivery and performance of this Agreement by Seller and the
consummation of the transactions contemplated hereby, does not and will
not violate, conflict with or result in the breach of any term, condition
or provision of, or require the consent of any other person under, (a) any
existing law, ordinance, or governmental rule or regulation to which
Seller is subject, (b) any judgment, order, writ, injunction, decree or
award of any court, arbitrator or governmental or
7
regulatory official, body or authority which is applicable to Seller, (c)
the Articles of Organization and By-Laws, each as amended to date, of, or
any securities issued by Seller, or (d) any mortgage, indenture,
agreement, contract, commitment, lease, plan, permit license, or other
instrument, document or understanding , oral or written, to which Seller
is a party, by which Seller may have rights or by which any of the Assets
may be bound or affected, or give any party, by which Seller may have
rights or by which any of the Assets may be bound or affected, or give any
party the right thereunder the right to terminate, modify, accelerate,
cancel or otherwise change the existing rights or obligations of Seller
thereunder. Except as disclosed by Seller and agreed to by Purchaser on
or before the Closing Date no authorization, approval or consent of, and
no resignation or filing with, any governmental or regulatory official,
body or authority is required in connection with the execution, delivery
or performance of this Agreement by Seller.
3.4. FINANCIAL STATEMENTS.
(a) Seller has also previously delivered to Purchaser its Current
unaudited Balance Sheet for February 28, 1999, (the Current
Financial Statement") attached as Schedule 3.4(a). The
Current Financial Statement will be prepared in accordance
with generally accepted accounting principles applied
consistently with past practice, and have been certified by
the Seller's comptroller in the case of the Current Financial
Statements.
(b) The Financial Statements for February and March fairly
present, as of their respective dates, the financial condition
of assets and liabilities of Seller; with respect to the
contracts and commitments for the sale of goods or the
provision of services by Seller, the Financial Statements
contain and reflect adequate reserves, which
8
are consistent with previous reserves taken, for all
reasonably anticipated material losses and costs and expenses.
3.5 ABSENCE OF UNDISCLOSED LIABILITIES. Except as and to the extent
(a) reflected and reserved in the Current Balance Sheet, (b) set forth
on Schedule 3.5 attached hereto or (c) incurred in the ordinary course
of business after the date of the Current Balance Sheet and not material
in amount, either individually or in the aggregate, Seller does not have
any liability or obligation, secured or unsecured, whether accrued,
absolute, contingent, unasserted or otherwise, affecting the Assets. For
purposes of this Section 3.5 "material" means any amount in excess of
$75,000.00.
3.6 CONTRACTS AND COMMITMENTS.
(a) Schedule 3.6 annexed hereto contains complete and
correct list and description of the following contracts
and agreements, whether written or oral (collectively,
the "Contracts"):
(i) Delete
(ii) all pledges, conditional sale or title retention agreements,
security agreements, equipment obligations, personal property
leases and lease purchase agreements relating to any of the
Assets to which Seller is a party or by which Seller or any
of its property is bound.
(iii) all contracts, agreements, commitments, purchase orders or
other understandings or arrangements to which Seller is a
party or by which Seller or any of its property is bound
which (A) involve payments or receipts by Seller of more than
$5,000.00 in the case of any single contract, agreement,
commitment, understanding or arrangement under which full
performance (including payment) has
9
not been rendered by all parties thereto or (B) which may
materially adversely affect the condition (financial or
otherwise) or the properties, assets, business or prospects
of Seller;
(iv) Delete
(v) all agency, distributor, sales representative and similar
agreement to which Seller is a party;
(vi) Delete
(vii) all leases, whether operating, capital or otherwise, under
which Seller is lessor or lessee;
(viii)any other material agreement or contract entered into by
Seller, including without limitation, the purchase orders
which have been committed to or accepted by Seller.
(b) Except as set forth on Schedule 3.6(b) annexed hereto:
(i) each Contract is a valid and binding agreement of Seller,
enforceable against Seller in accordance with its terms, and
Seller does not have any knowledge that any Contract is not a
valid and binding agreement of the other parties thereto;
(ii) Delete
(iii) Seller is not in breach of or default under any Contract, and
no event has occurred which with the passage of time or
giving of notice or both would constitute such a default,
result in a loss of
10
rights or result in the creation of any lien, charge or
encumbrance, thereunder or pursuant thereto;
(iv) to the best knowledge of Seller, there is no existing breach
or default by any other party to any Contract, and no event
has occurred which with the passage of time or giving of
notice or both would constitute a default by such other
party, result in a loss of rights or result in the creation
of any lien, charge or encumbrance thereunder or pursuant
thereto;
(v) Seller is not restricted by any Contract except by government
regulation as part of military specifications under which
certain products are manufactured from carrying on its
business anywhere in the world; and
(vi) Delete
(c) Delete
(d) True, correct and complete copies of all Contracts have previously
been delivered by Seller to Purchaser.
3.7 COMPLIANCE WITH AGREEMENTS OF LAWS. Seller has all requisite
licenses, permits, and certificates, including environmental, health and
safety permits, from federal, state and local authorities necessary to
conduct its business and own and operate its assets (collectively, the
"Permits"). Schedule 3.7 annexed hereto sets forth a true, correct and
complete list of all such Permits, copies of which have previously been
delivered by Seller to Purchaser. All Permits shall inure to the benefit of
Purchaser immediately following the Closing without the requirement of
obtaining any consent, giving Purchaser the same rights as Seller immediately
prior to the Closing. Except as set forth on Schedule 3.7 annexed hereto,
Seller has not since January 1,
11
1996 received any notice or communication from any federal, state or local
governmental or regulatory authority or otherwise of any such violation or
noncompliance.
3.8 Delete
3.9 DISCLAIMER OF ALL OTHER WARRANTIES. EXCEPT AS SET FORTH IN SECTIONS 3.1
THROUGH 3.7 HEREOF, THE ASSETS ACQUIRED BY PURCHASER HEREUNDER ARE BEING SOLD
"AS IS" AND "WHERE IS" WITH ALL FAULTS THAT MAY EXIST THEREIN. SELLER
DISCLAIMS ANY WARRANTY OF ANY OTHER KIND, INCLUDING ANY WARRANTY THAT THE ASSETS
ARE FIT FOR A PARTICULAR PURPOSE.
3.10 SECURITY CLEARANCE. Seller received a Facility Security Clearance
for ▇▇▇ ▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇ dated July 24,
1998 from the Defense Investigating Service. This clearance is due to expire
on July 23, 1999.
4. REPRESENTATIONS AND WARRANTIES OF PURCHASER.
Purchaser represents and warrants to Seller as follows:
4.1 CORPORATE EXISTENCE. Purchaser is a corporation duly organized,
validly existing and in good standing under the laws of the State of
Delaware.;
4.2 CORPORATE POWER; AUTHORIZATION; ENFORCEABLE OBLIGATIONS. Purchaser
has the corporate power, authority and legal right to execute, deliver and
perform this Agreement. The execution, delivery and performance of this
Agreement by Purchaser has been duly authorized by all necessary corporate
action. This Agreement has been, and the other agreements, documents and
instruments required to be delivered by Purchaser in accordance with the
provisions hereof ("Purchaser's Documents") will be, duly executed and
delivered by Purchaser, and this Agreement constitutes, and Purchaser's
Documents when executed and delivered will constitute, the legal, valid
12
and binding obligations of Purchaser; enforceable against Purchaser in
accordance with their respective terms.
4.3 PURCHASER OBJECTIVE. The Purchaser acknowledges that it is aware
and has knowledge that shipments and backlog of business of the Seller has
declined in volume and that Seller shall have no liability arising from the
sales or backlog decline.
4.4. NO RELIANCE. Purchaser represents that it has conducted its own
due diligence and it is relying solely upon such due diligence with which it
is satisfied and it is not relying upon any representations of Seller other
than the representations contained herein.
5. CONDITIONS PRECEDENT TO THE CLOSING.
5.1 LEASE OBLIGATIONS. This Agreement is subject to Purchaser
executing with Seller's current landlord (the "Landlord"), on or before the
Closing Date, a new lease agreement for the period from the Closing Date to
the end of the period of Seller's present lease and an additional period of
five (5) years thereafter, for the premises located at ▇▇▇ ▇▇▇▇▇. ▇▇▇▇
▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇, and that Seller shall have no
obligation to the Landlord during any term of Purchaser's lease or extensions
thereof as a result of Purchasers actions or omissions post closing.
5.2 EMPLOYMENT CONTRACT OF ▇▇▇▇▇▇ ▇▇▇▇▇. This Purchase Agreement is
subject to the Purchaser executing with ▇▇▇▇▇▇ ▇▇▇▇▇, on or before the
Closing Date, an employment contract on terms mutually agreeable to the
Purchaser and to ▇▇▇▇▇▇ ▇▇▇▇▇. Further, it is a condition of this Agreement
that the Purchaser assumes all liability with respect to all employment
benefits and obligations due to ▇▇▇▇▇▇ ▇▇▇▇▇ and annexed hereto on Schedule
5.2.
13
5.3 CONDITIONS TO OBLIGATIONS OF SELLER. The obligations of Seller to
consummate the transactions contemplated by this Agreement are subject to the
satisfaction, on or before the Closing Date, of the following conditions:
(a) REPRESENTATIONS AND WARRANTIES. The representations
and warranties of Purchaser set forth in this Agreement shall be true and
correct in all material respects as of the date of this Agreement and as
of the Closing Date as though made on and as of the Closing Date.
(b) PERFORMANCE BY THE PURCHASER. On or before Closing Date,
Purchaser shall have performed and complied with all agreements and
conditions required by this Agreement.
(c) FORM AND CONTENT OF DOCUMENTS. The form and content
of all documents, certificates and other instruments to be delivered by
Purchaser shall be reasonably satisfactory to Seller.
(d) LITIGATION AFFECTING CLOSING. No court order shall have
been issued or entered which would be violated by the consummation of the
transactions contemplated by this Agreement. No person or entity shall
have commenced or threatened to commence any litigation seeking to
restrain or prohibit, or to obtain substantial damages in connection with
this Agreement or the transactions contemplated by this Agreement.
(e) PURCHASE PRICE. Seller shall have received the Closing
Payment constituting the purchase price for the Assets.
5.4 CONDITIONS TO OBLIGATIONS OF PURCHASER. The obligations of
Purchaser to consummate the transactions contemplated by this Agreement
are subject to the satisfaction on or before the Closing Date of the
following conditions.
14
(a) REPRESENTATIONS AND WARRANTIES. The
representations and warranties of Seller set forth in this Agreement
shall be true and correct in all material respects as of the date of this
Agreement and as of the Closing Date as though made on and as of the
Closing Date.
(b) PERFORMANCE BY SELLER. Seller shall have performed
and complied with all agreements and conditions required by this
Agreement.
(c) NO THREATENED OR PENDING LITIGATION. On or before
the Closing Date, no suit, action or other proceeding, or injunction or
final judgment relating thereto, shall be threatened or pending before
any court or governmental or regulatory official, body or authority in
which it is sought to restrain or prohibit or to obtain damages or other
relief in connection with this Agreement or the consummation of the
transactions contemplated hereby, and no investigation that might result
in any such suit, action or proceeding shall be pending or threatened.
(d) Delete
(e) FORM AND CONTENT DOCUMENTS. The form and content
of all documents, certificates and other instruments to be delivered by
Seller shall be reasonably satisfactory to Purchaser.
(f) The transactions contemplated by this Agreement shall
have been approved by all necessary corporate and stockholder action
by Seller.
6. NON COMPETITION. Seller on behalf of itself and its affiliates
agrees that neither Seller nor its affiliates will for a period of five
(5) years from the Closing Date either directly or indirectly engage in
the hybrid circuit business,
15
the thin film circuit business or the flip chip assembly business, each of
which are businesses in which Seller is presently engaged.
7. TAXES. Seller will, on a timely basis, file all tax returns
for and pay any and all taxes which shall become due or shall have
accrued (i) on account of the operation of the business of Seller or the
ownership of the Assets during the period on or before the Closing Date
or (ii) on account of the sale of the Assets (including a pro-rata
portion of all personal property and excise taxes payable with respect to
the Assets of Seller).
8. UNITED STATES GOVERNMENT PROPERTY. Purchaser acknowledges that
certain equipment upon Seller's premises is the property of the United
States Government. Such equipment is listed on Schedule 8 annexed hereto.
At Closing Seller shall transfer all such property to the possession of
Purchaser. However, Seller makes no representation with regard to the
final disposition of said property including but not limited to the length
of time it will remain in the possession of Purchaser.
9. INDEMNIFICATION.
9.1 Seller hereby indemnifies and holds harmless Purchaser and
its affiliates and their respective officers, directors,
employees and agents against all claims, damages, losses,
liabilities, costs and expenses (including, without
limitation, settlement costs and any legal, accounting or
other expenses for investigating or defending any actions or
threatened actions) reasonably incurred by such persons in
connection with each and all of the following:
(a) Any breach by Seller of any representation or warranty in
this Agreement;
16
(b) Any breach of any covenant, agreement or obligation of Seller
contained in this Agreement or any other agreement,
instrument or document contemplated by this Agreement;
(c) Any liability or obligation relating to a Seller Liability or
otherwise relating to an Excluded Asset;
(d) Any violation by Seller of, or any failure by Seller to
comply with, any law, ruling, order, decree, regulation or
zoning, environmental or permit requirement applicable to
Seller, the Assets or its business, whether or not any such
violation or failure to comply has been disclosed to
Purchaser.
(e) The failure of Purchaser to obtain the protections afforded
by compliance with the notification and other requirements of
the bulk sales laws in force in the jurisdictions in which
such laws may be applicable to either Seller or the
transaction contemplated by this Agreement;
(f) Any warranty claim or product liability claim relating to (I)
products manufactured or sold by Seller prior to the Closing
Date to the extent resulting in costs, expenses or
liabilities to Purchases in the aggregate in excess of
$25,000.
(g) Any tax liabilities or obligations of Seller;
(h) Any mortgage, lien, pledge, security interest, charge, claim,
restriction or encumbrance of any nature whatsoever effecting
or encumbering the Assets; and
17
(i) Any failure of Seller to comply with any applicable federal
or state securities laws or applicable laws relating to
shareholder appraisal rights.
9.2 BY PURCHASER. Purchaser hereby indemnifies and holds
harmless Seller and its affiliates and their respective officers, directors,
employees and agents from any and all claims, damages, losses, liabilities,
costs and expenses (including, without limitation, settlement costs and any
legal, accounting or other expenses for investigating or defending any actions
or threatened actions) reasonably incurred by such persons, in connection with
each and all of the follows:
(a) Any breach by Purchaser of any representation or warranty in
this Agreement;
(b) Any breach of any covenant, agreement or obligation of
Purchaser contained in this Agreement or in any other
agreement, instrument or document contemplated by this
Agreement;
(c) Any Assumed Liability; and
(d) Any liability relating to the operation of the business
purchased by Purchaser pursuant to this Agreement first
arising after the Closing Date (other than a liability
resulting from a breach of a representation by Seller or with
respect to which Purchaser is indemnified pursuant to Section
9.1 of this Agreement.
(e) Any liabilities arising out of the operation of the business
by Purchaser first occurring on or after the Closing Date
relating to any claims of vendors of Seller and any claims of
Employees of Seller who are hired by Purchaser.
18
9.3 CLAIMS FOR INDEMNIFICATION. Whenever any claim shall arise for
indemnification hereunder the party seeking indemnification (the "Indemnified
Party"), shall promptly notify the party from whom indemnification is sought
(the "Indemnifying Party") of the claim and, when known, the facts
constituting the basis for such claim. In the event of any such claim for
indemnification hereunder resulting from or in connection with any claim or
legal proceedings by a third-party, the notice to the Indemnifying Party
shall specify, if known, the amount or an estimate of the amount of the
liability arising therefrom. The Indemnified Party shall not settle or
compromise any claim by a third party for which it is entitled to
Indemnification hereunder without the prior written consent of the
Indemnifying Party, which shall not be unreasonably withheld, unless suit
shall have been instituted against it and the Indemnifying Party shall not
have taken control of such suit after notification thereof as provided in
Section 9.4 of this Agreement.
9.4 DEFENSE OF INDEMNIFYING PARTY. In connection with any claim giving
rise to indemnity hereunder resulting from or arising out of any claim or
legal preceding by a person who is not a party to this Agreement the
Indemnifying Party at its sole cost and expense may, upon written notice to
the Indemnified Party, assume the defense of any such claim or legal
proceeding if it acknowledges to the Indemnified Party in writing its
obligations to indemnify the Indemnified Party with respect to all elements
of such claim. The Indemnified Party shall be entitled to participate in
(but not control) the defense of any such action, with its counsel and at its
own expense. If the Indemnifying Party does not assume the defense of any
such claim or litigation resulting therefrom within thirty (30) days after
the date such claims is made, (a) the Indemnified Party may defend against
such claim or litigation, in such manner as it may deem appropriate,
including, but not limited to, settling such claim or litigation, after
giving notice of the same to the Indemnifying Party, on such terms as the
Indemnified Party may deem appropriate, and (b) the Indemnifying Party shall
be entitled to participate in (but not control) the defense of such action,
with its counsel and at its own expense. If the indemnifying Party
thereafter seeks to question the manner in which the Indemnified Party
defended such third party claim or the amount or nature of any such
settlement, the Indemnifying Party
19
shall have the burden to prove by a preponderance of the evidence that the
Indemnified Party did not defend or settle such third party claim in a
reasonably prudent manner.
9.5 PAYMENT OF INDEMNIFICATION OBLIGATION. All indemnification by
Purchaser or Seller hereunder shall be effected by payment of cash or
delivery of a cashier's or certified check in the amount of the
indemnification liability.
9.6 SURVIVAL OF REPRESENTATIONS; CLAIMS FOR INDEMNIFICATION. All
representations and warranties made by the parties herein or in any instrument
or document furnished in connection herewith shall survive the Closing and any
investigation at any time made by or on behalf of the parties hereto. All
claims for indemnification relating to a breach of a representation or warranty
shall be asserted prior to the end of the twelve month period commencing on the
Closing Date.
10. SELLER'S EMPLOYEES. As of the Closing Date, Purchaser shall offer
employment to the employees of Seller listed on Schedule 10 annexed hereto.
As of the Closing Date, all employees who are employed by Purchaser shall no
longer be considered employees of Seller for any purposes.
11. MISCELLANEOUS.
11.1 AMENDMENT. This Agreement may only be amended by an instrument
in writing signed on behalf of each of the parties hereto.
11.2 EXTENSION WAIVER. At any time prior to the Closing the
parties hereto may extend the time for the performance of any of the
obligations or other acts of the other parties hereto, waive any
inaccuracies in the representations and warranties contained herein or
in any document delivered pursuant hereto and waive compliance with any
of the agreements or conditions contained herein. Any agreement on the
part of a party hereto to any such extension or
20
waiver shall be valid only if set forth in a written instrument signed on
behalf of both parties.
11.3 COUNTERPARTS. This Agreement may be executed in two or more
counterparts, all of which shall be considered one and the same agreement
and shall become effective when two or more counterparts have been signed
by each of the parties and delivered to the other parties, it being
understood that all parties need not sign the same counterpart.
11.4 GOVERNING LAW. This Agreement shall be governed and construed
in accordance with the laws of the Commonwealth of Massachusetts. Each
party hereby irrevocably submits to the jurisdiction of the Superior
Court of the Commonwealth in respect of any suit, action or proceeding
arising out of this Agreement, and irrevocably accepts for themselves for
and in respect of their property, generally and unconditionally, the
jurisdiction of the aforesaid court.
11.5 NOTICE. Any notice, request, demand, waiver, consent, approval or
other communication which is required or permitted hereunder shall be in writing
and shall be deemed given only if delivered personally or sent by registered or
certified mail, postage prepaid, as follows:
If to Seller, to:
HyComp, Inc.
C/o XIT Corporation
▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇.
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇-▇▇▇▇
Attention: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇
21
With a required copy to:
▇▇▇▇▇▇ & Waldstein
▇.▇. ▇▇▇ ▇▇▇
▇▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇.
▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇, Esq.
If to Purchaser to:
HyComp Acquisition Corp.
c/o SatCon Technology Corporation
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
[Remainder of Page Intentionally Left Blank]
22
Attention: ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇▇
With a required copy to:
▇▇▇▇ and ▇▇▇▇ LLP
▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇▇▇ ▇. Carp, Esq.
or to such other address as the addressee may have specified in a notice duly
given to the sender as provided herein.
11.6 ASSIGNMENT AND BINDING EFFECT. This Agreement may not be assigned
prior to the Closing by any party hereto without the prior written consent of
the other parties. Subject to the foregoing, all of the terms and provision
of this Agreement shall be binding upon and inure to the benefit of and be
enforceable by the successors and assigns of Seller and Purchaser.
11.7 BROKERS AND FINDERS FEES. Seller, on the one hand, and Purchaser,
on the other hand, each to the other represent and warrant that any and all
broker's or investment banker's fees due and payable as a result of this
Agreement shall be the sole and exclusive responsibility of the party who has
engaged such broker or investment banker on its behalf.
11.8 SEVERABILITY. Any provision of this Agreement which is invalid or
unenforceable in any jurisdiction shall be ineffective to the extent of such
invalidity or unenforceability without invalidating or rendering
unenforceable the remaining provisions hereof, and any such invalidity or
unenforceability in any jurisdiction shall not invalidate or render
unenforceable such provision in any other jurisdiction.
IN WITNESS WHEREOF, the parties hereto have duly executed this Agreement under
seal as of the date set forth above.
23
HyComp, Inc.
By: /s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇
--------------------
▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇
Chairman and CEO
HyComp Acquisition Corp.
By: /s/ ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇▇
----------------------
▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇▇
President and CEO
24