Exhibit 2.1
SHARE PURCHASE AGREEMENT
Share Purchase Agreement dated August 29th, 2005, between 4317467 Canada Inc.,
a corporation incorporated under the laws of Canada ("Purchaser"), Ramtron
International Corporation, a corporation incorporated under the laws of
Delaware ("Ramtron"), Goal Semiconductor Inc. / Semi-Conducteur Goal Inc., a
corporation incorporated under the laws of Canada (the "Corporation") and the
shareholders listed on the signature page hereto (collectively, "Vendors").
WHEREAS the Corporation develops, designs, manufactures and sells embedded
data acquisition micro-controllers and other related products;
WHEREAS the Corporation and Ramtron have executed a Letter of Intent on
June 29, 2005 as amended on August 12, 2005 and August 23, 2005;
WHEREAS Purchaser wishes to acquire the Corporation and Vendors wish to sell
the Corporation to Purchaser;
AND WHEREAS this Agreement sets forth the terms and conditions upon which
Purchaser will purchase from Vendors, and Vendors will sell to Purchaser, all
of the issued and outstanding shares of the Corporation.
NOW, THEREFORE, THE PARTIES AGREE AS FOLLOWS:
ARTICLE 1
INTERPRETATION
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1.1 Defined Terms
As used in this Agreement, the following terms have the following
meanings:
(a) "Affiliate" has the meaning specified in the Canada Business Corporations
Act, as in force on the date hereof.
(b) "Agreement" means this share purchase agreement and all schedules,
exhibits and instruments which amend or confirm this share purchase
agreement; and the expressions "Article" and "Section" followed by a
number mean and refer to the specified Article or Section of this
Agreement.
(c) "Authorization", with respect to any Person, means any order, permit,
certificate of authorization, approval, registration, waiver, licence or
similar authorization of any Governmental Entity having jurisdiction over
the Person.
(d) "Balance Sheet Date" means April 30, 2005.
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(e) "BDC" means the Business Development Bank of Canada, one of the Vendors.
(f) "Books and Records" means all books of account, tax records, sales and
purchase records, customer and supplier lists, formulae, technical
documents including specifications, business reports, plans and
projections and all other documents, files, correspondence, Corporate
Records and other information of the Corporation whether in written or
electronic form.
(g) "Business Day" means any day other than a Saturday, Sunday or other day
on which the principal commercial banks in Montreal, Quebec are not open
for business during normal business hours.
(h) "Closing" means the completion of the purchase and sale transaction
contemplated in this Agreement.
(i) "Closing Date" means August 29, 2005 or such other date as may be agreed
upon in writing by the Parties.
(j) "Closing Date Balance Sheet" means the balance sheet of the Corporation
prepared by the Corporation and reviewed and accepted by Purchaser as of
the last moment on the day preceding the Closing Date, in accordance with
GAAP.
(k) "Commission" means the commission payable to SVB Alliant by the Vendors
and/or the Corporation at the time of the Closing.
(l) "Consent" means the unconditional written consent of a contracting party
to, or as a result of, the transactions contemplated by this Agreement,
if required by the terms of any Contract between such contracting party
and the Corporation.
(m) "Contracts" means all agreements, contracts, undertakings and commitments
to which the Corporation is bound, whether written or oral, including
unfilled purchase orders received by the Corporation.
(n) "Corporation" means Goal Semiconductor Inc. / Semi-Conducteur Goal Inc.
(o) "Corporate Records" means the corporate records of the Corporation
including (i) all constating documents and by-laws; (ii) all minutes of
meetings and resolutions of shareholders and directors (and any
committees); (iii) the share certificate books, securities register,
register of transfers and register of directors and (iv) the corporate
seal.
(p) "Designated Vendors" means BDC, Fonds, Investissement Technologie and
Vision2000.
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(q) "Employee Plans" means all the employee benefit, fringe benefit,
supplemental unemployment benefit, bonus, incentive, profit sharing,
termination, change of control, pension, retirement, stock option, stock
purchase, stock appreciation, phantom stock, health, welfare, medical,
dental, disability, life insurance and similar plans, programs,
arrangements or practices relating to current or former employees,
officers or directors of the Corporation maintained, sponsored or funded
by the Corporation, whether written or oral, funded or unfunded, insured
or self-insured, registered or unregistered, other than government-
sponsored employment insurance, workers' compensation, health insurance
or pension plans.
(r) "Environment" means all components of the earth, including air (and all
layers of the atmosphere), land (and all surface and subsurface soil,
underground spaces and cavities and all land submerged under water) and
water (and all surface and underground water), organic and inorganic
matter and living organisms. For greater certainty, the interacting
natural systems that include components referred to above are included in
the definition of "Environment".
(s) "Environmental Laws" means all applicable Laws and Contracts with
Governmental Entities relating to public health, pollution or the
protection of the Environment, including civil responsibility for acts or
omissions with respect to the Environment, and all Authorizations issued
pursuant to such Laws or Contracts.
(t) "Escrow Agent" means National Bank Trust, or such other Person as may be
appointed in replacement thereof pursuant to the terms of the Escrow
Agreement.
(u) "Financial Statements" means the audited financial statements for the
Corporation as at December 31, 2002, 2003 and 2004, respectively,
consisting in each case of a balance sheet and the accompanying
statements of income, retained earnings and cash flow for the period then
ended and notes to the financial statements together with the report of
the auditors thereon, a copy of which financial statements is annexed
hereto as Schedule 3.2(x).
(v) "Fonds" means the Fonds de solidarite des travailleurs du Quebec
(F.T.Q.), one of the Vendors.
(w) "GAAP" means, at any time, generally accepted accounting principles in
Canada including those set out in the Handbook of the Canadian Institute
of Chartered Accountants in force at such time.
(x) "Governmental Entity" means any (i) multinational, federal, provincial,
state, municipal, local or other governmental or public department,
central bank, court, arbitral body with legal jurisdiction, commission,
board, bureau, agency or instrumentality, domestic or foreign, (ii) any
subdivision or authority of any of the foregoing or (iii) any quasi-
governmental or private body exercising any regulatory, expropriation or
taxing authority under or for the account of any of the above.
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(y) "Hazardous Materials" means any waste or other substance that is listed,
defined, designated or classified as, or otherwise determined to be,
hazardous, radioactive or toxic or a pollutant or a contaminant under or
pursuant to any Environmental Laws, including any mixture or solution
thereof, and specifically including petroleum and all derivatives thereof
or synthetic substitutes therefor and asbestos or asbestos-containing
materials.
(z) "Intellectual Property" means domestic and foreign (i) patents,
applications for patents and reissues, divisions, continuations,
renewals, extensions and continuations-in-part of patents or patent
applications; (ii) inventions (whether patentable or not), invention
disclosures, improvements, discoveries, trade secrets, confidential
information such as know-how, methods, processes, designs, technical
data, schematics and customer lists, and documentation relating to any of
the foregoing; (iii) copyrights, copyright registrations and applications
for copyright registration; (iv) designs, design registrations, design
registration applications and integrated circuit topographies; (v) trade
names, business names, corporate names, domain names, website names and
world wide web addresses, common law trade-marks, trade-▇▇▇▇
registrations, trade ▇▇▇▇ applications, trade dress and logos, and the
goodwill associated with any of the foregoing; (vi) software; and
(vii) any other intellectual property and industrial property.
(aa) "Interim Financial Statements" means the unaudited balance sheet of the
Corporation as at April 30, 2005 and the accompanying unaudited statement
of income and statement of changes in financial position of the
Corporation for the four-month period then ended attached as
Schedule 1.1(aa).
(bb) "Interim Period" means the period between the execution of this
Agreement and the Closing Date.
(cc) "Investissement Technologie" means Investissement Technologie
(3599) Inc., one of the Vendors.
(dd) "ITA" means the Income Tax Act (Canada).
(ee) "Laws" means (i) all constitutions, treaties, laws, statutes, codes,
ordinances, principles of common law, orders, decrees, rules, regulations
and municipal by-laws, whether domestic, foreign or international,
(ii) all judgments, orders, writs, injunctions, decisions, rulings,
decrees and awards of any Governmental Entity and (iii) all policies,
practices and guidelines of, or Contracts with, any Governmental Entity
which, although not actually having the force of law, are considered by
such Governmental Entity as requiring compliance as if having the force
of law, in each case binding on or affecting the Party or Person referred
to in the context in which such word is used.
(ff) "Leased Property" means the premises described in Schedule 1.1(ff).
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(gg) "Lease" means the lease of the Leased Property described in
Schedule 1.1 0.
(hh) "Lien" means any hypothec, mortgage, charge, pledge, prior claim,
security interest, assignment, lien (statutory or otherwise), Bank Act
security, servitude, easement, restrictive covenant, conditional sale,
resolutory condition, leasing, title retention agreement, restrictive
covenant or other encumbrance, arrangement or condition of any nature
which, in substance, secures payment or performance of an obligation.
(ii) "Loans" means the long-term loan from the Government of Quebec and the
shareholder loans described in Schedule 1.1 (ii).
(jj) "Material" means of such a nature or amount as would reasonably be
regarded as significant in relation to the Corporation's business or in
relation to the capital, financial condition or results of operation of
the Corporation, and "Materially" has a corresponding meaning.
(kk) "Material Adverse Change" or "Material Adverse Effect" means any change
or effect that:
(i) individually or when taken together with all other changes or
effects that have occurred during any relevant period of time before
the determination of the occurrence of that change or effect is or
is reasonably likely to be Materially adverse to the business,
operations, assets, liabilities, capital, financial condition or
results of operation of the Corporation; or
(ii) Materially adversely affects the ability of the Corporation to
conduct its business after the Closing Date substantially as the
business has been conducted to the date of this Agreement.
(ll) "Ordinary Course" means, with respect to an action taken by a Person,
that such action is consistent with the past practices of the Person and
is taken in the ordinary course of the normal day-to-day operations of
the Person.
(mm) "Parties" means Vendors, the Corporation, Ramtron and Purchaser and any
other Person who may become a party to this Agreement.
(nn) "Permitted Liens" means non-consensual Liens for taxes, assessments or
governmental charges or levies on property not yet due and delinquent.
(oo) "Person" means a natural person, partnership, corporation, limited
liability company, unlimited liability company, joint stock company,
trust, unincorporated association, joint venture or other entity or
Governmental Entity, and pronouns have a similarly extended meaning.
(pp) "Prime Rate" means the annual rate of interest set from time to time by
Silicon Valley Bank as a reference rate then in effect for determining
interest rates on commercial demand loans made by it in United States
dollars.
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(qq) "Purchased Shares" means all of the issued and outstanding shares in the
capital of the Corporation which will be issued and outstanding
immediately prior to Closing, the whole as set out in Schedule 2.1 in
respect of each Vendor.
(rr) "Ramtron Stock" means the common stock of Ramtron to be issued to the
Vendors pursuant to Sections 2.3 (d) and 2.3 (e) and which will be
registered pursuant to Section 5.2.
(ss) "Relief" means any allowance, credit, deduction, expense, depreciation,
loss, exemption or set-off in respect of any Tax or relevant to the
computation of any income, profits or gains for the purposes of any Tax,
or saving of Tax, including the use of the tax attributes of the
Corporation.
(tt) "Required Consents" means those Consents listed and described in
Schedule 3.2(c).
(uu) "Shareholders' Agreement" means the shareholders' agreement of the
Corporation dated November 14, 2003 entered into between the Corporation
and certain shareholders of the Corporation, a copy of which has been
delivered to Purchaser.
(vv) "Shareholding and Voting Agreements" means the shareholding and voting
agreements between the Corporation and each of Abdellah Azelmad, ▇▇▇▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇ ▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇ and ▇▇▇▇▇
▇▇▇▇▇▇▇▇.
(ww) "Transactions" means the transactions contemplated by this Agreement.
(xx) "Vision2000" means Vision2000 Venture Ltd., one of the Vendors;
(yy) "Working Capital" means the amount by which the aggregate book value of
the current assets (including, without limitation, R&D tax credits) of
the Corporation as shown on the Closing Date Balance Sheet exceeds the
aggregate book value of the current liabilities of the Corporation as
shown on the Closing Date Balance Sheet determined in accordance with
GAAP, adjusted to take into account the accrual or payment of the Loans
in full, capital interest and costs through maturity or until payment
thereof.
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1.2 Other Defined Terms
In addition to the defined terms in Section 1.1, each of the following
capitalized terms shall have the meaning ascribed thereto in the corresponding
Sections:
Term Section
---- -------
Damages . . . . . . . . . . . . . . . . . . . 8.1(a)
Deposit . . . . . . . . . . . . . . . . . . . 8.4(b)
Escrow Agreement . . . . . . . . . . . . . . 2.3(e)
Escrow Shares . . . . . . . . . . . . . . . . 2.3(e)
Exchange Act . . . . . . . . . . . . . . . . 3.1(g)
Expenses . . . . . . . . . . . . . . . . . . 5.1(f)
Holders . . . . . . . . . . . . . . . . . . . 5.2(a)
Indemnified Party . . . . . . . . . . . . . . 8.5
Indemnifying Party . . . . . . . . . . . . . 8.5
Investor Representation Statement . . . . . . 6.2(a)
ITCs . . . . . . . . . . . . . . . . . . . . 3.2(hh)(xiii)
Joint Representations and Covenants . . . . . 8.4(a)
Material Contracts . . . . . . . . . . . . . 3.2(s)
Notice . . . . . . . . . . . . . . . . . . . 8.6
Prohibited Transaction . . . . . . . . . . . 5.1(i)
Purchase Price . . . . . . . . . . . . . . . 2.2
Purchaser . . . . . . . . . . . . . . . . . . Preamble
Ramtron SEC Documents . . . . . . . . . . . . 4.2(i)
Registration Shares . . . . . . . . . . . . . 5.2(a)
Resale Registration Statement . . . . . . . . 5.2(a)
SEC . . . . . . . . . . . . . . . . . . . . . 4.2(i)
Securities Act . . . . . . . . . . . . . . . 3.1(g)
Solidary Representations and Covenants . . . 8.4(a)
Tax . . . . . . . . . . . . . . . . . . . . . 3.2(hh)(i)
Tax Returns . . . . . . . . . . . . . . . . . 3.2(hh)(ii)
Third Party Claim . . . . . . . . . . . . . . 8.7(a)
Vendors . . . . . . . . . . . . . . . . . . . Preamble
Vendors' Core Representations . . . . . . . . 3.1
1.3 Gender and Number
Any reference in this Agreement to gender includes all genders (including
neuter) and words denoting the singular number only shall include the plural
and vice versa.
1.4 Headings, Etc.
The provision of a table of contents, the division of this Agreement into
Articles and Sections and the insertion of headings are for convenient
reference only and shall not affect the interpretation of this Agreement.
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1.5 Currency
All references in this Agreement to dollars or to "$", unless otherwise
specifically indicated, are to the currency of the United States of America.
1.6 Knowledge
Where any representation or warranty contained in this Agreement is expressly
qualified by reference to the knowledge of the Corporation, it shall be deemed
to refer to the actual knowledge of any of ▇▇▇ ▇▇▇▇▇▇▇▇▇ and ▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇,
and to the extent that such Persons did not possess sufficient knowledge of
the facts or matters relating to any such representation or warranty, such
Persons shall have been deemed to have obtained and confirmed the truth of the
same through inquiries of other officers or employees of the Corporation who,
having regard to their positions, job descriptions and responsibilities,
should reasonably be expected to have and disclose knowledge relevant to the
representation and warranty in question.
Where any representation or warranty contained in this Agreement is expressly
qualified by reference to the knowledge of Purchaser or Ramtron, it shall be
deemed to refer to the actual knowledge of any of ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇, III and
▇▇▇▇ ▇. ▇▇▇▇▇▇, and to the extent that such Persons did not possess sufficient
knowledge of the facts or matters relating to any such representation or
warranty, such Persons shall have been deemed to have obtained and confirmed
the truth of the same through inquiries of other officers or employees of
Ramtron and Purchaser who, having regard to their positions, job descriptions
and responsibilities, should reasonably be expected to have and disclose
knowledge relevant to the representation and warranty in question.
1.7 Accounting Terms
All accounting terms not specifically defined in this Agreement shall be
interpreted in accordance with GAAP.
1.8 Incorporation of Schedules and Exhibits
The Schedules and Exhibits attached to this Agreement shall form an integral
part of this Agreement.
Any disclosure in any Schedule is deemed to be given only with respect to the
Sections of this Agreement which specifically refer to such Schedule and any
other Sections specifically referenced in such Schedule.
1.9 References to Income Tax Act
All references in this Agreement to the ITA and other taxation acts and to
amounts to be withheld pursuant thereto shall be deemed to be made to the ITA,
(and any legislation of any Province of Canada from time to time of like or
similar effect) such other taxation acts, as now enacted or as it may from
time to time be amended, re-enacted or replaced, and in the case of any such
amendment, re-enactment or replacement, any references herein to the ITA, (and
any legislation of any Province of Canada from time to time of like or similar
effect) and other taxation acts and to amounts to be withheld pursuant thereto
shall be read as referring to such amended, re-enacted or replaced provisions.
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1.10 Legal Representation; No Presumption Against Purchaser
Each Party acknowledges that such party has been represented by counsel in
connection with the negotiation and execution of this Agreement and related
matters, and that the terms of this Agreement and related matters have been
negotiated by it. Any rule of Law or any legal decision (including Article
1432 of the Civil Code of Quebec) that would require interpretation of any
claimed ambiguities in this Agreement against the Party that drafted it has no
application and any such right is expressly waived by the Parties.
1.11 Day Not a Business Day; Calculation of Delays
If an action is required to be taken hereunder no later than a day which is
not a Business Day, then such action shall instead be required to be taken no
later than the next succeeding Business Day.
If any action may be taken within, or any right or obligation is to expire at
the end of, a period of days under this Agreement, then the day which is the
reference day in calculating such period shall be excluded.
1.12 Overlapping Representations
Any representation and warranty given by a Party in this Agreement shall not
be deemed to be limited or qualified solely because a similar or more general
representation and warranty given by such Party in this Agreement is limited
or qualified.
ARTICLE 2
PURCHASE AND SALE; PURCHASE PRICE
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2.1 Purchase and Sale
Subject to the terms and conditions of this Agreement, each Vendor hereby
sells, assigns and transfers to Purchaser and Purchaser hereby purchases from
each Vendor at Closing, all (but not less than all) of the right, title and
interest of the Vendors in and to the Purchased Shares held by each such
Vendor at the Closing Date as set forth in Schedule 2.1.
2.2 Purchase Price
The purchase price (the "Purchase Price") payable by Purchaser for the
Purchased Shares shall be the aggregate of the following amounts:
(a) U.S.$5,900,000.00; and
(b) the amount of the Working Capital as at the Closing Date.
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2.3 Payment of the Purchase Price
Purchaser hereby pays the Purchase Price as follows as directed by the
Vendors:
(a) by paying to SVB Alliant on the Closing Date the Commission in accordance
with the terms of a certain engagement letter dated on or about
January 27, 2005, by a wire transfer to SVB Alliant's account;
(b) by paying on the Closing Date the legal fees of BCF LLP by bank draft or
certified cheque;
(c) by paying on the Closing Date an amount equal to U.S.$800,000 less the
amounts paid pursuant to 2.3(a) and 2.3 (b) to the Vendors or their
designees by bank draft or certified cheque such amount to be allocated
to each Vendor as set forth in Schedule 2.3; and
(d) by causing Ramtron to issue to each of the Designated Vendors on the
Closing Date the respective number of fully paid and non-assessable
Ramtron Stock set forth in Schedule 2.3 and by delivering to each of the
Designated Vendors on the Closing Date share certificates registered in
the respective name of each of the Designated Vendors, evidencing the
respective number of Ramtron Stock so issued to them;
(e) by causing Ramtron to issue to the Designated Vendors on the Closing Date
the respective number of fully paid and non-assessable Ramtron Stock set
forth in Schedule 2.3, (the "Escrow Shares") and by delivery to the
Escrow Agent on the Closing Date share certificates registered in the
name of each of the Designated Vendors evidencing the respective number
of Ramtron Stock so issued to them, such share certificates to be held
and released by the Escrow Agent pursuant to the terms and conditions of
the escrow agreement executed at Closing by the Designated Vendors,
Purchaser, Ramtron, ▇▇▇ ▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇ and the Escrow Agent
substantially in the form attached as Exhibit "A" (the "Escrow
Agreement").
2.4 Non-Resident Vendors
Notwithstanding Section 2.3, if a non-resident Vendor (the "Non-Resident
Vendor") fails to deliver to Purchaser, at or prior to Closing, a certificate
(the "Federal Certificate") issued pursuant to Section 116 of the Income Tax
Act (Canada) and a certificate (the "Quebec Certificate") issued pursuant to
the equivalent provisions of the Taxation Act (Quebec), each in respect of his
Purchased Shares and each containing a certificate limit at least equal to the
Purchase Price payable to the Non-Resident Vendor, then Purchaser shall be
entitled to withhold from the Purchase Price payable to the Non-Resident
Vendor the following amounts: (i) for remittance to the Receiver General an
amount equal to 25% of the Purchase Price payable to the Non-Resident Vendor
in cash and Ramtron Stock, (the "Federal Required Amount"); (ii) for
remittance to Revenue Quebec an amount equal to 12% of the Purchase Price
payable to the Non-Resident Vendor in cash and Ramtron Stock, (the "Quebec
Required Amount") and (iii) an indemnification amount equal to Ten percent
(10%) of the Purchase Price payable to the Non-Resident Vendor in cash and
Ramtron Stock (the "Indemnity Amount").
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If the Federal Certificate is delivered to Purchaser after Closing but prior
to thirty (30) days of the month following the Closing (the "Remittance
Date"), the amount of the Federal Required Amount and two-thirds of the
Indemnity Amount held by Purchaser will be paid forthwith to or to the order
of the Non-Resident Vendor. If the Federal Certificate has not been delivered
to Purchaser prior to the Remittance Date, an amount equal to the Federal
Required Amount shall be remitted by Purchaser to the Receiver General for
Canada and two-thirds of the Indemnity Amount will be paid forthwith to or to
order of the Non-Resident Vendor; provided however, that if the Non-Resident
Vendor provides confirmation, satisfactory to Purchaser, acting reasonably,
that the Non-Resident Vendor has applied prior to Closing, for issuance of the
Federal Certificate and that said application is being diligently pursued,
then, at the option of the Purchaser, the amount of the Federal Required
Amount and two-thirds of the Indemnity Amount shall continue to be held on the
terms set out in this Section 2.4 and the Non-Resident Vendor shall indemnify
Purchaser for any Tax, interest or penalty for which Purchaser is assessed as
a consequence of not remitting or timely remitting the Federal Required Amount
to the Receiver General for Canada on the Remittance Date. Purchaser shall be
entitled to offset any such Tax, interest or penalty against amounts held
hereunder by Purchaser. Upon delivery of the Federal Certificate to Purchaser,
purchaser shall, provided it has not at such time been assessed for any Tax
interest or penalty, remit forthwith the Federal Required Amount and two-
thirds of the Indemnity Amount held by Purchaser to or to the order of the
Non-Resident Vendor. If at such time Purchaser has been assessed for any Tax
interest or penalty, it shall remit forthwith the Federal Required Amount and
two-thirds of the Indemnity Amount less the amount of the assessment to or to
the order of the Non-Resident Vendor.
If the Quebec Certificate is delivered to Purchaser after Closing but prior to
the Remittance Date, the amount of the Quebec Required Amount and one third of
the Indemnity Amount held by Purchaser will be paid forthwith to or to the
order of the Non-Resident Vendor. If the Quebec Certificate has not been
delivered to Purchaser prior to the Remittance Date, an amount equal to the
Quebec Required Amount shall be remitted by Purchaser to Revenue Quebec and
one third of the Indemnity Amount will be paid forthwith to or to the order of
the Non-Resident Vendor; provided however, that if the Non-Resident Vendor
provides confirmation, satisfactory to Purchaser, acting reasonably, that the
Non-Resident Vendor has applied prior to Closing, for issuance of the Quebec
Certificate and that said application is being diligently pursued, then, at
the option of the Purchaser, the Quebec Required Amount and one third of the
Indemnity Amount shall continue to be held on the terms set out in this
Section 2.4 and the Non-Resident Vendor shall indemnify Purchaser for any Tax,
interest or penalty for which Purchaser is assessed as a consequence of not
remitting or timely remitting the Quebec Required Amount to the Minister of
Revenue of Quebec. Purchaser shall be entitled to offset any such Tax,
interest or penalty against amounts held hereunder by Purchaser. Upon delivery
of the Quebec Certificate to Purchaser, purchaser shall, provided it has not
at such time been assessed for any Tax interest or penalty, remit forthwith
the Quebec Required Amount and one-third of the Indemnity Amount held by
Purchaser to or to the order of the Non-Resident Vendor. If at such time
Purchaser has been assessed for any Tax interest or penalty, it shall remit
forthwith the Quebec Required Amount and one-third of the Indemnity Amount
less the amount of the assessment to or to the order of the Non-Resident
Vendor.
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Purchaser shall, acting reasonably, permit the Non-Resident Vendor to access
and use monies withheld hereunder to pay, or to provide security to Federal or
Quebec taxation authorities for the payment of, the Non-Resident Vendor's
income taxes, if any, in respect of the sale of the Purchased Shares, as long
as Purchaser is not prejudiced thereby.
ARTICLE 3
REPRESENTATIONS AND WARRANTIES OF VENDORS
-----------------------------------------
3.1 Joint Representations and Warranties of Vendors
Each Vendor hereby jointly (within the meaning of the Civil Code of Quebec)
represents and warrants to Purchaser and Ramtron as follows as of the date
hereof (the "Vendors' Core Representations") with respect to himself or
itself, as the case may be, and acknowledges and confirms that Purchaser and
Ramtron is relying upon such representations and warranties in connection with
the purchase by Purchaser of the Purchased Shares notwithstanding any
investigation by, or knowledge of, Purchaser:
(a) Incorporation and Qualification. If Vendor is a corporation, then it is
a corporation duly and validly incorporated, organized and existing under
the Laws of its jurisdiction of incorporation and has the corporate power
and authority to own and sell its property and enter into and perform its
obligations under this Agreement.
(b) Validity of Agreement. The execution, delivery and performance by such
Vendor of this Agreement:
(i) if Vendor is a corporation, have been duly authorized by all
necessary corporate action on its part;
(ii) do not (or would not with the giving of notice, the lapse of time,
or both, or the happening of any other event or condition) result in
a breach or a violation of, or conflict with, or allow any other
Person to exercise any rights under, any terms or provisions of its
constating documents or by-laws; and
(iii) will not result in the violation of any Law.
(c) Execution and Binding Obligation. This Agreement has been duly executed
and delivered by, and constitutes a legal, valid and binding obligation
of, enforceable against, such Vendor in accordance with its terms,
subject only to any limitation under applicable Laws relating to
(i) bankruptcy, winding-up, insolvency, arrangement and other similar
Laws of general application affecting the enforcement of creditors'
rights and (ii) the discretion that a court may exercise in the granting
of extraordinary remedies such as specific performance and injunction.
Page-12
(d) Title to Purchased Shares. Immediately prior to the execution of this
Agreement, such Vendor was the sole and unconditional owner of the number
and class of shares of the Corporation set out beside such Vendor's name
in Schedule 2.1, with a good and valid title thereto, free and clear of
all Liens. Such shares constitute all of such Vendor's share of the
Purchased Shares and are fully-paid and non-assessable. Upon Closing,
such Vendor will transfer good and valid title to Purchaser of the
Purchased Shares set forth beside such Vendor's name on Schedule 2.1,
free and clear of all Liens.
(e) Residence of Vendors. Except as provided in Schedule 3.1, each Vendor is
not a non-resident of Canada within the meaning of the Income Tax Act
(Canada).
(f) No Other Agreements to Purchase. Except for Purchaser's rights under
this Agreement and rights of first refusal under the Shareholders'
Agreement which are hereby waived, no Person has any written or oral
agreement, option or warrant, or any right or privilege (whether by Law,
pre-emptive or contractual) capable of becoming such for the purchase or
acquisition from such Vendor of any of the Purchased Shares.
(g) Investment in Ramtron Stock. Each Designated Vendor jointly (within the
meaning of the Civil Code of Quebec) represents, warrants and covenants
to Purchaser with respect to itself only that:
(i) such Designated Vendor (A) is knowledgeable, sophisticated and
experienced in making, and is qualified to make, decisions with
respect to investments such as would be involved in making a
decision to accept the Ramtron Stock in the manner contemplated by
this Agreement, (B) has the knowledge and experience in financial
and business matters as to be capable of evaluating the merits and
risks of an investment in the Ramtron Stock, and such Designated
Vendor's financial situation is such that such Designated Vendor can
afford to bear the economic risks of holding the Ramtron Stock for
an indefinite period of time and suffer complete loss of the
investment, (C) has requested, received, reviewed and considered all
information it deems relevant in making an informed decision to
acquire the Ramtron Stock, (D) has, in connection with its decision
to acquire the Ramtron Stock, relied solely upon an independent
investigation made by such Designated Vendor and its advisors and
the representations and warranties of Purchaser and Ramtron
contained herein, (E) is an "accredited investor" within the meaning
of Rule 501(a) of Regulation D promulgated under the United States
Securities Act of 1933, as amended (the "Securities Act"), and (F)
will acquire the Ramtron Stock hereunder solely for its own account
and not with a view to, or for resale in connection with, any
distribution or disposition thereof other than pursuant to an
effective registration statement under the Securities Act or an
exemption thereunder.
Page-13
(ii) such Designated Vendor understands that the Ramtron Stock is being
offered and sold to it in reliance upon specific exemptions from the
registration requirements of the Securities Act and the rules and
regulations promulgated thereunder and under applicable Canadian
securities laws, and Purchaser is relying upon the truth and
accuracy of, and such Designated Vendor's compliance with, the
representations, warranties, agreements, acknowledgments and
understandings of such Designated Vendor set forth herein in order
to determine the availability of such exemptions and to comply
therewith.
(iii) such Designated Vendor acknowledges that the Ramtron Stock to be
delivered to Designated Vendor under this Agreement will not, at the
time of delivery, be registered under the Securities Act or under
the securities laws of any state or other jurisdiction. Such
Designated Vendor further acknowledges that the Ramtron Stock issued
under this Agreement will be "restricted securities" (as defined in
Rule 144 under the Securities Act) and may not be sold or
transferred, except in accordance with the terms of the legend set
forth below. Such Designated Vendor acknowledges that any
certificate or certificates evidencing the Ramtron Stock issued
hereunder will bear a legend (until such time as it is no longer
required under the applicable requirements of the Securities Act or
any other applicable securities or corporate rules and regulations
thereto) substantially to the effect set forth below and that a stop
transfer order may be placed with respect thereto.
"THE SHARES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN REGISTERED
UNDER THE UNITED STATES SECURITIES ACT OF 1933, AS AMENDED (THE
"SECURITIES ACT"), OR ANY APPLICABLE SECURITIES LAWS OF ANY
JURISDICTION AND MAY NOT BE SOLD, ASSIGNED OR TRANSFERRED UNLESS
(A) A REGISTRATION STATEMENT UNDER THE SECURITIES ACT AND SUCH
APPLICABLE SECURITIES LAWS SHALL HAVE BECOME EFFECTIVE WITH REGARD
THERETO OR (B) THE RESALE IS MADE UNDER RULE 144 OR (C) THE RESALE
IS MADE OUTSIDE THE UNITED STATES IN ACCORDANCE WITH REGULATION S
UNDER THE SECURITIES ACT AND THE APPLICABLE LAWS OF SUCH NON-US
JURISDICTION OR (D) IN THE OPINION OF COUNSEL IN FORM, SUBSTANCE AND
SCOPE REASONABLY ACCEPTABLE TO RAMTRON INTERNATIONAL CORPORATION,
REGISTRATION UNDER SUCH SECURITIES ACT AND SUCH APPLICABLE
SECURITIES LAWS IS NOT REQUIRED IN CONNECTION WITH SUCH PROPOSED
TRANSFER."
(iv) such Designated Vendor represents, warrants to and covenants with
Purchaser that it will not, directly or indirectly, offer, sell,
pledge, sell short, transfer or otherwise dispose of (or solicit any
offers to buy, purchase or otherwise acquire or take a pledge of)
any Ramtron Stock except in compliance with the Securities Act, the
Securities Exchange Act of 1934, as amended (the "Exchange Act"),
and the rules and regulations promulgated thereunder and any other
applicable securities laws.
Page-14
(v) such Designated Vendor was not provided with and has not requested
an offering memorandum as defined in applicable Canadian securities
laws.
(vi) no person has made any written or oral representation to such
Designated Vendor:
(A) that any person will resell or repurchase the Ramtron Stock;
(B) that any person will refund the purchase price of the Ramtron
Stock other than as provided in this Share Purchase Agreement;
or
(C) relating to the future price or value of the Ramtron Stock.
(vii) such Designated Vendor is not a company or other entity established
solely to acquire securities under the prospectus exemption set out
in the Securities Act (Quebec);
(h) No Brokers, Etc. Other than the entity entitled to the Commission, no
broker, finder, agent or similar intermediary has acted on behalf of such
Vendor in connection with this Agreement or the transactions contemplated
hereby, and, other than the Commission, there are no brokerage
commissions, finders' fees or similar fees or commissions payable by such
Vendor in connection herewith.
3.2 Representations and Warranties of the Corporation
The Corporation represents and warrants to Purchaser and Ramtron as follows as
of the date hereof and acknowledges and confirms that Purchaser and Ramtron is
relying upon such representations and warranties in connection with the
purchase by Purchaser of the Purchased Shares notwithstanding any
investigation by, or knowledge of, Purchaser or Ramtron.
(a) Incorporation and Qualification. The Corporation is a corporation duly
and validly incorporated, organized, in good standing and existing under
the Laws of its jurisdiction of incorporation and has the corporate power
to own and operate its property, carry on its business as currently
conducted and enter into and perform its obligations under this
Agreement. The Corporation is duly qualified, licensed or registered to
carry on business in the jurisdictions listed in Schedule 3.2(a). The
jurisdictions listed in Schedule 3.2(a) include all jurisdictions in
which the nature of the assets or the business of the Corporation makes
such qualification necessary or in which the Corporation owns or leases
any material assets or conducts any material business.
(b) No Default. The Corporation is not in breach, default or violation (and
no event has occurred that with notice or the lapse of time or both would
constitute a breach, default or violation) of any term, condition or
provision of its constating documents or by-laws.
Page-15
(c) Validity of Agreement. Except for the Consents disclosed in
Schedule 3.2(c), the execution, delivery and performance by the
Corporation of this Agreement:
(i) have been duly authorized by all necessary corporate action on its
part;
(ii) do not (or would not with the giving of notice, the lapse of time,
or both, or the happening of any other event or condition) result in
a breach or a violation of, or conflict with, or allow any other
Person to exercise any rights under, any of the terms or provisions
of (A) its constating documents or (B) by-laws or any Contracts or
instruments to which the Corporation is a party or pursuant to which
any of its assets, business or share capital may be affected;
(iii) will not result in a breach of, or cause the termination or
revocation of, any Authorization held by it or necessary to the
ownership or the operation of the business of the Corporation which
would have a Material Adverse Effect on the Corporation; and
(iv) will not result in the violation of any Law which would have a
Material Adverse Effect on the Corporation.
(d) Required Authorizations. There is no requirement of the Corporation to
make any filing with, give any notice to, or obtain or maintain any
Authorization of, any Governmental Entity as a condition to the lawful
completion of the transactions contemplated by this Agreement or the
continued operation of the business of the Corporation.
(e) Investment Canada Act. The Corporation does not provide any of the
services and does not engage in any of the activities of a business
described in subsection 14.1(5) of the Investment Canada Act (Canada).
(f) Authorized and Issued Capital. The authorized capital of the Corporation
consists of an unlimited number of the following classes of shares:
Common Shares and Class A Preferred Shares of which 3,604,878 Common
Shares and 10,013,540 Class A Preferred Shares, (and no more) have been
duly issued and are outstanding as fully paid and non-assessable.
Immediately prior to the execution of this Agreement, such shares were
registered in the name of Vendors as set forth in Schedule 2.1. Such
shares have been issued in compliance with all applicable Laws.
Except as disclosed in Schedule 3.2(f), there are no outstanding options,
warrants, rights, securities, debentures, loans or notes convertible or
exchangeable for any shares or other securities of the Corporation.
The Purchased Shares (i) constitute all of the issued and outstanding
shares in the share capital of the Corporation, (ii) have been duly
issued and shall be outstanding as fully paid and non-assessable, (iii)
have been issued in compliance with all applicable Laws and (iv) are
registered in the name of Purchaser.
Page-16
(g) Subsidiaries. The Corporation has no subsidiaries and holds no shares or
other ownership, equity or proprietary interests in any other Person.
(h) No Other Agreements to Purchase. Except for Purchaser's rights under
this Agreement, no Person has any written or oral agreement, option or
warrant, or any right or privilege (whether by Law, pre-emptive or
contractual), with the Corporation or capable of becoming such for the
purchase, subscription, allotment or issuance of any of the unissued
shares or other securities of the Corporation.
(i) Corporate Records. To the Corporation's knowledge, the Corporate Records
are true, complete and accurate, and contain copies of all of the
articles, by-laws and resolutions adopted by the shareholders and
directors of the Corporation since the date of its incorporation, all of
which have been duly adopted, and registers all past or present
securities, shareholders and securities issuances, redemptions and
transfers. The Corporation is not currently subject to, or affected by,
a unanimous shareholders' agreement. However, it is party to the
Shareholders Agreement which will be terminated concurrently herewith.
(j) Conduct of Business in Ordinary Course. Except as disclosed in
Schedule 3.2(j), since the Balance Sheet Date the Corporation has carried
on its business in the Ordinary Course and, without limiting the
generality of the foregoing, the Corporation has not:
(i) made or assumed any commitment, obligation or liability which is
outside the Ordinary Course;
(ii) ceased to operate its properties and carry on its business as
carried on immediately prior to such date;
(iii) transferred to any Person any rights to the Intellectual Property
owned, held or used by it, except in connection with sales of the
Corporation's products or services in the Ordinary Course;
(iv) terminated, entered into, amended or otherwise modified any
agreements pursuant to which any Person is granted manufacturing,
marketing, distribution or similar rights of any type or scope or
any third party royalty rights with respect to any products or
services of the Corporation, or entered into or amended any
strategic alliance, license or sub-license agreement, or joint
development agreement;
(v) terminated, entered into, amended or otherwise modified in any
material respect any Contract;
(vi) sold or otherwise in any way alienated or disposed of any of its
assets other than in the Ordinary Course;
(vii) suffered any material shortage or any cessation or interruption of
products, shipments or ordinary services;
Page-17
(viii) split, combined or reclassified any of its shares, or issued,
granted, repriced, redeemed, retired, repurchased or otherwise
acquired shares in its capital, any options, warrants, rights with
respect to shares in its capital or bonds, debentures, notes or
other corporate security;
(ix) reserved, declared, made or paid any dividend, or made any other
distributions or appropriations of profits or capital;
(x) discharged any secured or unsecured obligation or liability (whether
accrued, absolute, contingent or otherwise), other than obligations
and liabilities discharged in the Ordinary Course;
(xi) waived or cancelled any material claim, account receivable, trade
account or right outside the Ordinary Course, or made any gift;
(xii) terminated the employment of any manager or officer or granted any
severance or termination pay to any director, manager, officer or
any other employee;
(xiii) paid a bonus to an employee other than as specified in written
employment agreements, copies of which have been provided to
Purchaser;
(xiv) made any change in the rate or form of compensation or remuneration
payable or to become payable to any of its shareholders, directors,
officers, employees or agents which is outside the Ordinary Course;
(xv) entered into any termination, notice, severance or change of control
agreement with any of its shareholders, directors, officers,
employees or agents;
(xvi) made any change in its accounting principles, policies and practices
as utilized in the preparation of the Financial Statements and the
Interim Financial Statements;
(xvii) granted to any customer any special allowance or discount, or
changed its pricing, credit or payment policies, other than in the
Ordinary Course;
(xviii) made any individual capital expenditure in excess of $5,000 or
aggregate capital expenditures in excess of $25,000;
(xix) made any loan or advance to, or assumed, guaranteed or otherwise
became liable with respect to the liabilities or obligations of any
Person;
(xx) modified its constating documents, by-laws or capital structure;
(xxi) removed any auditor or accountant, or had any auditor or accountant
resign;
Page-18
(xxii) purchased or otherwise acquired any corporate security or
proprietary, participatory, profit or other equity interest in any
Person;
(xxiii) incurred any indebtedness other than to trade creditors in the
Ordinary Course;
(xxiv) settled any litigation or claims, or suffered any judgments,
requiring payment by the Corporation in excess of $25,000 in the
aggregate or granting injunctive relief or specific performance;
(xxv) cancelled or reduced any of its insurance coverage, or received
notice thereof or of non-renewal or increase in premium from the
underwriters or the Corporation's brokers; or
(xxvi) authorized, agreed or otherwise committed to any of the foregoing.
(k) No Material Adverse Change. Since the Balance Sheet Date, there has been
no material adverse change in the business, assets, liabilities,
operations, properties, results of operation, prospects or condition
(financial or otherwise) of the Corporation and no event has occurred or
circumstances exist which may result in such a material adverse change.
(l) Compliance with Laws. The Corporation has conducted and is continuing to
conduct its business in material compliance with all applicable Laws.
(m) Title to the Assets. The Corporation owns (with good and valid title)
all of the properties and assets (whether immovable, movable, real,
personal or mixed and whether tangible or intangible) that it purports to
own including all the properties and assets reflected as being owned by
the Corporation in the financial Books and Records and the balance sheet
which forms part of the Interim Financial Statements other than inventory
sold in the Ordinary Course since April 30, 2005 prior to Closing. The
Corporation has legal and beneficial ownership of such properties and
assets free and clear of all Liens, except for Permitted Liens and Liens
disclosed in Schedule 3.2(m).
(n) Condition and Sufficiency of Tangible Assets. The tangible assets owned
or leased by the Corporation, are in good operating condition and repair
having regard to their use and age and are adequate and suitable for the
uses to which they are being put. None of such tangible assets is in
need of maintenance or repairs, except for normal maintenance and
repairs. The tangible assets owned or leased by the Corporation
constitute all of the tangible assets used or held for use in connection
with the business and activities of the Corporation as currently
conducted.
(o) Owned Property. The Corporation does not own any real or immoveable
property.
Page-19
(p) Leases. The Corporation is not a party to, or under any agreement to
become a party to, any lease with respect to immovable or real property
other than the Lease. The Lease is in good standing, creates a good and
valid interest in the Leased Property and is in full force and effect.
With respect to the Lease, (i) all rents and additional rents have been
paid, (ii) no waiver, indulgence or postponement of the lessee's
obligations has been granted by the lessor and (iii) there exists no
event of default under the Lease.
(q) Inventories. Inventories of the Corporation (other than inventories
which have been written down in the Interim Financial Statements) have
been valued in the Interim Financial Statements at the lower of cost or
net realizable value.
(r) Accounts Receivable. All accounts receivable of the Corporation are bona
fide, result from the Ordinary Course, have been properly recorded in the
Ordinary Course and, to the Corporation's knowledge, are good and
collectible in full when due without any discount, set-off or
counterclaim.
(s) Material Contracts. Except for the Contracts described in
Schedule 3.2(s), the Lease, the Contracts referred to in Section 3.2(u),
the Employee Plans, the insurance policies set out in Schedule 3.2(ee)
and the Contracts listed in Schedule 3.2(cc) (collectively, the "Material
Contracts"), the Corporation is not a party to or bound by:
(i) any distribution, sales, advertising, agency, franchise or
manufacturer's representative Contract;
(ii) any ongoing Contract for the purchase of materials, supplies,
equipment or services involving in the case of any such Contract
more than $25,000 over the term of the Contract;
(iii) any Contract that expires, or that may be renewed at the option of
any Person other than the Corporation so as to expire, more than one
year after the date of this Agreement;
(iv) any trust indenture, deed of hypothec, mortgage, promissory note,
loan agreement or other Contract for the borrowing of money, any
currency exchange, swaps, commodities or other hedging or derivative
arrangement, or any leasing transaction of the type required to be
capitalized in accordance with GAAP;
(v) any Contract for capital expenditures in excess of $5,000 in the
aggregate;
(vi) any Contract pursuant to which the Corporation is a lessor of any
machinery, equipment, motor vehicles, office furniture, fixtures or
other movable or personal property;
Page-20
(vii) any confidentiality, secrecy or non-disclosure Contract or any
Contract limiting the freedom of the Corporation to engage in any
line of business, compete with any other Person, solicit employees
or clients, operate its assets at maximum production capacity or
otherwise conduct its business;
(viii) any Contract involving any continuing representation, warranty or
indemnification obligation of the Corporation to any other Person,
other than in the Ordinary Course;
(ix) any Contract of guarantee, support, indemnification, assumption or
endorsement of, or any similar commitment with respect to, the
obligations, liabilities (whether accrued, absolute, contingent or
otherwise) or indebtedness of any other Person;
(x) any Contract with any Person with whom the Corporation or any of
Vendors does not deal at arm's length within the meaning of the ITA;
or
(xi) any other Contract made out of the Ordinary Course.
(t) No Breach of Material Contracts. The Corporation has performed all
obligations required to be performed by it and is entitled to all
benefits under, and, to the Corporation's knowledge, is not alleged to be
in default of, any Material Contract to which it is a party. Each of the
Material Contracts is in full force and effect and there exists no actual
or, to the Corporation's knowledge, alleged default or event of default
or event, occurrence, condition or act (including the purchase of the
Purchased Shares) which, with the giving of notice, the lapse of time, or
both, or the happening of any other event or condition, would become a
default or event of default under any Material Contract. True, correct
and complete copies of all Material Contracts (as amended) have been
delivered to Purchaser.
(u) Intellectual Property.
(i) Attached as Schedule 3.2(u)(i)Part (A) is a list of Intellectual
Property owned by the Corporation and Schedule 3.2(u)(i) Part (B) is
a list of Intellectual Property licensed to the Corporation or used
by the Corporation in carrying on its business.
(ii) The Corporation possesses a sufficient amount of, and valid licenses
for, third parties' commercial software it currently uses in
connection with its operations.
(iii) Schedule 3.2(u)(iii) includes complete and accurate particulars of
all registrations and applications for registration of the
Intellectual Property owned by the Corporation. All of the
Corporation's owned Intellectual Property which has been registered
or applied for has been properly maintained and renewed by the
Corporation in accordance with all applicable Laws.
Page-21
(iv) Except as set forth in Schedule 3.2(u)(iv) and in any other Schedule
to this Agreement, the Intellectual Property owned by the
Corporation is not subject to any Liens and the Corporation has the
right to use all the Intellectual Property used by it in carrying on
its business.
(v) Except as set forth in Schedule 3.2(u)(v), the Corporation is not a
party to or bound by any Contract or other obligation that limits or
impairs its ability to use, sell, transfer, assign or convey, or
that otherwise affects, any of the Intellectual Property owned by
the Corporation.
(vi) Except as set forth in Schedule 3.2(u)(vi), to the Corporation's
knowledge, the operation of the Corporation's business does not
infringe upon the Intellectual Property rights of any Person. Except
as set forth in Schedule 3.2(u)(vi), no claims have been asserted
or, to the knowledge of the Corporation, are threatened by any
Person alleging that the conduct of the Corporation's business,
including the use of the Intellectual Property owned by, licensed to
or used by the Corporation, infringes upon any of their Intellectual
Property rights.
(vii) Except as set forth in Schedule 3.2(u)(vii), the transactions
contemplated by this Agreement and the continued operation of the
Corporation's business will not violate or breach the Material terms
of any Intellectual Property license, or entitle any other party to
any such Intellectual Property license granted by the Corporation to
any other party, to terminate or modify it, or otherwise adversely
affect the Corporation's rights under it.
(viii) Except as set forth in Schedule 3.2(u)(viii), the Intellectual
Property owned by or licensed to the Corporation or which the
Corporation otherwise has the right to use constitutes all
Intellectual Property necessary for the conduct of the Corporation's
business as presently conducted. Except as set forth in
Schedule 3.2(u)(viii), following Closing, the Corporation will be
entitled to continue to use, practice and exercise rights in, all of
the Intellectual Property owned by, licensed to and used by the
Corporation, to the same extent and in the same manner as prior to
Closing without additional financial obligation to any Person.
(ix) Except as set forth in Schedule 3.2(u)(ix), to the Corporation's
knowledge, no Person is currently infringing any of the Intellectual
Property owned by the Corporation.
(x) Except as set forth in Schedule 3.2(u)(x), none of the software
owned by the Corporation contains any open source, copy left or
community source code, including any libraries or code licensed
under any license agreement or arrangement obliging the Corporation
to make source code publicly available.
Page-22
(xi) Since November 14, 2003 all current and former employees and
consultants of the Corporation whose duties or responsibilities
relate to the development of products for the Corporation have
entered into confidentiality, intellectual property assignment and
non-compete agreements with and in favour of the Corporation in the
form of the draft agreements appended hereto as Schedule 3.2(u)(xi).
(xii) Except as set forth in Schedule (xii), to the Corporation's
knowledge, all copyrights in and to the contents of the
Corporation's web sites are validly owned by the Corporation free
and clear thereto.
(v) Product and Service Warranties. Schedule 3.2(v) sets forth complete
and accurate copies of the written warranties and guarantees by the
Corporation currently in effect with respect to its products and
services. There are no oral warranties outstanding. There have not
been any material deviations from such warranties and guarantees.
(w) Books and Records. Since January 1, 2002, all accounting and financial
Books and Records have been fully, properly and accurately kept and
completed in all material respects and for the period prior thereto, to
the Corporation's knowledge, all such accounting and financial Books and
Records have also been fully, properly and accurately kept and completed
in all material respects. The Books and Records and other data and
information are not recorded, stored, maintained, operated or otherwise
wholly or partly dependent upon or held by any means (including any
electronic, mechanical or photographic process, whether computerized or
not) which is not available to the Corporation in the Ordinary Course.
(x) Financial Statements. The Financial Statements and the Interim Financial
Statements have been prepared in accordance with GAAP applied on a basis
consistent with those of previous fiscal years and each fairly,
accurately and completely discloses in all material respects (i) the
assets, liabilities and obligations (whether accrued, contingent,
absolute or otherwise), income, losses, retained earnings, reserves and
financial position of the Corporation, (ii) the results of operations of
the Corporation and (iii) the changes in the financial position of the
Corporation, all as at the dates and for the periods therein specified.
True, correct and complete copies of the Financial Statements and the
Interim Financial Statements are attached as Schedule 3.2(x).
(y) No Undisclosed Liabilities. Except as disclosed in this Agreement and
Schedule 3.2(y) or reflected or reserved against in the balance sheet
forming part of the Interim Financial Statements or specifically
disclosed in a note therein, the Corporation does not have any
liabilities or obligations of any nature (whether absolute, accrued,
contingent or otherwise) that would have a Material Adverse Effect.
Page-23
(z) Bank Accounts and Powers of Attorney. Schedule 3.2(z) is a true, correct
and complete list showing (i) the name of each bank in which the
Corporation has an account or safety deposit box and the names of all
Persons authorized to draw on the account or to have access to the safety
deposit box and (ii) the names of all Persons holding powers of attorney
from the Corporation.
(aa) Environmental Matters. Except as set forth in Schedule 3.2(aa):
(i) the Corporation, its operations and the assets at the Leased
Property are, and at all times have been, in material compliance
with all Environmental Laws;
(ii) none of the real properties (including the Leased Property)
currently or formerly owned, leased or used by the Corporation or
over which the Corporation had charge, management or control (A)
has ever been used by the Corporation as a waste disposal site or a
landfill site, or (B) has ever had Hazardous Materials released,
spilled or discharged on, at or under such Leased Properties while
owned, leased or used by the Corporation.
(iii) the Corporation has not been required by any Governmental Entity to
(A) alter the Leased Property in a material way in order to be in
compliance with Environmental Laws, (B) file any notice with any
Governmental Entity relating to any potential or actual
contaminated real or immovable property or (C) perform any
environmental closure, decommissioning, rehabilitation, restoration
or post-remedial investigation on, about or in connection with any
real or immovable property, nor, is there any fact or circumstance
which could give rise to such a request by a Governmental Entity;
(iv) there are no pending or, to the Corporation's knowledge, threatened
claims or restrictions of any nature under or pursuant to any
Environmental Laws with respect to or affecting the Corporation or
the Leased Property; and
(x) the Corporation has not received any directive, inquiry, notice,
order, warning or other communication from any Governmental Entity
or other Persons that relates to any Hazardous Materials or any
alleged actual or potential violation or failure to comply with any
Environmental Laws.
Schedule 3.2(aa) lists all reports and documents relating to the
environmental matters affecting the Corporation and the Leased Property
which are in the possession or under the control of the Corporation.
Copies of all such reports and documents have been provided to
Purchaser. There are no other reports or documents relating to
environmental matters affecting the Corporation or the Leased Property
which have not been made available to Purchaser whether by reason of
confidentiality restrictions or otherwise.
Page-24
(bb) Authorizations. There are no Authorizations necessary to permit the
Corporation to lawfully conduct, operate or occupy its businesses,
activities and the Leased Property in the manner it currently conducts,
operates or occupies such businesses, activities and Leased Property,
and to own its assets except as may be declared in Schedule 3.2 (bb).
(cc) Employees. Except as set forth in Schedule 3.2(cc), the Corporation has
complied, and is in compliance, with all applicable Laws relating to
employment and labour matters, including any provision thereof relating
to wages, hours of work, vacation pay, overtime pay, occupational health
and safety and conditions of employment.
The Corporation has not been required to make any compensation
adjustments pursuant to the Pay Equity Act (Quebec) nor does it have any
commitments to make such compensation adjustments with respect to its
employees.
Except as set forth in Schedule 3.2(cc):
(i) there is no collective agreement in force with respect to the
employees of the Corporation, no collective agreement is currently
being negotiated by the Corporation, no union or employee
bargaining agent holds bargaining rights with respect to any
employees of the Corporation, and there are no current or, to the
Corporation's knowledge, threatened attempts to organize or
establish any trade union or employee association with respect to
the Corporation nor has there been any such attempts within the
past five years;
(ii) the Corporation has not engaged in any unfair labour practice.
There is no unfair labour practice complaint pending or, to the
Corporation's knowledge, threatened against the Corporation and
there is no labour strike, slow down, work stoppage or lockout in
effect or, to the Corporation's knowledge, threatened against the
Corporation, nor has there been any such event within the past five
years;
(iii) all amounts due and owing or accrued due but not yet owing for all
salary, wages, bonuses, commissions, vacation pay, pension benefits
or other employee benefits have been paid and, to the extent that
they should have been accrued, have been accrued and are reflected
in the Financial Statements;
(iv) the Corporation is not subject to any claim for wrongful dismissal,
constructive dismissal or any other claim, complaint or litigation
relating to employment, discrimination or termination of employment
of any of its employees or former employees or relating to any
failure to hire a candidate for employment;
(v) there is no order pursuant to any Law requiring the taking of any
action or the refraining from taking any action in respect of any
employee or former employee of the Corporation;
Page-25
(vi) there are no outstanding loans made by the Corporation to any
employee or former employee of the Corporation (for greater
certainty, travel advances or advances against commission of less
than $500.00 are not considered as a loan for the purposes of this
paragraph); and
(vii) to the Corporation's knowledge, no managerial employee and no group
of employees of the Corporation has any plans to terminate his, her
or their employment with the Corporation.
Schedule 3.2(cc) contains a correct and complete list of each director,
officer, employee, independent contractor, agent and consultant of the
Corporation whether actively at work or not, their salaries, wage rates,
commissions and consulting fees, bonus arrangements, benefits,
positions, status as full-time or part-time employees and length of
service along with a list of all employment agreements and all service
agreements of the Corporation with its employees and its consultants, as
the case may be. Except as set forth in Schedule 3.2(cc), no employee
of the Corporation has any agreement as to length of notice, severance
or termination payment required to terminate his employment.
(dd) Employee Plans
(i) Schedule 3.2(dd) lists all Employee Plans. The Corporation has
furnished to Purchaser true, correct and complete copies of all the
Employee Plans as of the date hereof, together with all related
material documentation and all material correspondence with all
Governmental Entities or other relevant Persons.
(ii) All of the Employee Plans are and have been established,
registered, qualified, invested and administered, in all respects,
in accordance with their terms and all Laws, including all Tax Laws
where same is required for preferential Tax treatment.
(iii) All obligations regarding the Employee Plans have been satisfied,
there are no outstanding defaults or violations by any party to any
Employee Plan and no Taxes, penalties or fees are owing or exigible
under or in respect of any of the Employee Plans.
(iv) No Employee Plan is subject to any pending investigation,
examination or other proceeding, action or claim initiated by any
Governmental Entity or by any other Person (other than routine
claims for benefits).
(v) All contributions or premiums required to be paid by the
Corporation under the terms of each Employee Plan or by Law have
been made in a timely fashion in accordance with Law and the terms
of the Employee Plans. The Corporation does not have any liability
(other than liabilities accruing after the date hereof) with
respect to any of the Employee Plans. Contributions or premiums for
the period up to the date hereof have been paid by the Corporation.
Page-26
(vi) No commitments to improve or otherwise amend any Employee Plan have
been made except as required by applicable Law.
(vii) No insurance policy or any other agreement affecting any Employee
Plan requires or permits a retroactive increase in contributions,
premiums or other payments due thereunder.
(viii) None of the Employee Plans provide benefits to retired employees or
to the beneficiaries or dependants of retired employees.
(ix) No Employee Plan exists that could require as a result of the
transactions contemplated by this Agreement (A) the payment to any
Person of any money, benefits or other property, (B) accelerated or
increased funding requirements for any Employee Plan or (C) the
acceleration or provision of any other increased rights or benefits
to any Person.
(ee) Insurance. Schedule 3.2(ee) contains a list of insurance policies which
are maintained by the Corporation. The Corporation is not in default
with respect to any of the provisions contained in the insurance
policies or the payment of any premiums under any insurance policy, nor
has it failed to give any notice or to present any claim under any
insurance policy in a due and timely fashion. Copies of all insurance
policies of the Corporation and the most recent inspection reports
received from insurance underwriters have been delivered to Purchaser.
(ff) Litigation. Except as described in Schedule 3.2(ff), there are no
(i) actions, claims, suits or proceedings by any Person,
(ii) arbitration or alternative dispute resolution processes or
(iii) any administrative or other proceedings by or before (or, to the
knowledge of the Corporation, any investigation by) any Governmental
Entity, pending or, to the knowledge of the Corporation, threatened
against or affecting the Corporation, or the business or assets of the
Corporation. The Corporation is not subject to any judgment, order or
decree entered in any lawsuit or proceeding nor has the Corporation
settled any claim prior to being prosecuted in respect of it. The
Corporation is not the plaintiff or complainant in any action, claim,
suit or proceeding.
(gg) Customers and Suppliers. Schedule 3.2(gg) contains a list of the top
Ten (10) customers of the Corporation (determined on the basis of
revenues) for each of the last two fiscal years and the top Ten
(10) suppliers of the Corporation (determined on the basis of cost of
goods and services purchased) for each of the last two fiscal years.
Since the Balance Sheet Date, except as disclosed in Schedule 3.2(gg),
none of such customers or suppliers has ceased to do business with the
Corporation other than as a result of ordinary course of business
project completion. To Corporation's knowledge, no such customer or
supplier is threatened with bankruptcy or insolvency.
Page-27
(hh) Tax Matters:
(i) Definition of Taxes. For the purposes of this Agreement, the term
"Tax" or, collectively, "Taxes" shall mean (A) any and all federal,
state, provincial, municipal, local and foreign taxes, assessments
and other governmental charges, duties, impositions and liabilities
including Canada Pension Plan and Provincial pension plan
contributions, unemployment insurance contributions and employment
insurance contributions, worker's compensation and deductions at
source, including taxes based on or measured by gross receipts,
income, profits, sales, capital, use, occupation, goods and
services, value added, ad valorem, transfer, franchise,
withholding, customs duties, payroll, recapture, employment, excise
and property taxes, together with all interest, penalties, fines
and additions imposed with respect to such amounts and (B) any
liability for the payment of any amounts of the type described in
paragraph (A) above as a result of any express or implied
obligation to indemnify any other Person or as a result of any
obligations under any agreements or arrangements with any other
Person with respect to such amounts and including any liability for
Taxes of a predecessor entity.
(ii) Computation, Preparation and Payment. The Corporation has
correctly computed all Taxes owing by it under the laws of Canada,
prepared and duly and timely filed all federal, state, provincial,
municipal, local and foreign returns, estimates, information
statements, elections, designations, reports and any other filings
related to Taxes ("Tax Returns"), required to be filed by it under
the laws of Canada, has timely paid all Taxes under the laws of
Canada which are or may become due and payable on or prior to the
date hereof and has made adequate provision for Taxes under the
laws of Canada in the Financial Statements for the period ended
December 31, 2004. The Corporation has made adequate and timely
instalments of Taxes under the laws of Canada required to be made.
Except as provided in Schedule 3.2(hh), to the knowledge of the
Corporation, the Corporation is not required to prepare or file any
Tax Returns in any jurisdiction outside of Canada or pay any taxes
in any jurisdiction outside of Canada.
(iii) Accrued Taxes. Since December 31, 2004, the Corporation has only
incurred liabilities for Taxes in the Ordinary Course.
(iv) Status of Assessments. All Tax Returns of the Corporation have
been assessed through and including each of the dates set forth in
Schedule 3.2(hh), and there are no outstanding waivers of any
limitation periods or agreements providing for an extension of time
for the filing of any Tax Return or the payment of any Tax by the
Corporation or any outstanding objections to any assessment or
reassessment of Taxes. Any proposed deficiencies have been paid and
settled.
Page-28
(v) Contingent Tax Liabilities. There are no contingent Tax
liabilities under the laws of Canada or any grounds that could
prompt an assessment or reassessment of the Corporation under the
laws of Canada including aggressive treatment of income, expenses,
deductions, credits or other amounts in the filing of earlier or
current Tax Returns in Canada, nor has the Corporation received any
indication from any taxation authorities in Canada that an
assessment or reassessment of Tax is proposed.
Except as provided in Schedule 3.2(hh), to the knowledge of the
Corporation, there are no contingent Tax liabilities in any
jurisdiction outside of Canada and the Corporation has not received
any indication from any taxation authorities in any jurisdiction
outside of Canada that an assessment or reassessment of Tax is
proposed.
(vi) Withholdings. Except as provided in Schedule 3.2(hh), the
Corporation has withheld from each payment made to any of its past
and present shareholders, directors, officers, employees and agents
the amount of all Taxes and other deductions required to be
withheld and has paid such amounts when due, in the form required
under the appropriate legislation, or made adequate provision for
the payment of such amounts to the proper receiving authorities.
The amount of Tax withheld but not remitted by the Corporation will
be retained in the appropriate accounts and will be remitted by the
Corporation to the appropriate authorities when due.
(vii) Collection and Remittance. The Corporation has collected from each
receipt from any of the past and present customers (or other
Persons paying amounts to the Corporation) the amount of all Taxes
(including goods and services tax and provincial sales taxes)
required to be collected under the laws of Canada and has paid and
remitted such Taxes when due, in the form required under the
appropriate legislation in Canada or made adequate provision for
the payment of such amounts to the proper receiving authorities in
Canada. The amount of such Taxes collected but not remitted by the
Corporation will be retained in the appropriate accounts and
remitted by the Corporation to the appropriate authorities in
Canada when due.
Except as provided in Schedule 00, to the knowledge of the
Corporation, the Corporation was not required to collect from any
of the past and present customers (or other Person paying amounts
to the Corporation) any Taxes under the laws of any jurisdiction
outside of Canada.
(viii) Assessments. The Corporation is not and, to the knowledge of the
Corporation, will be subject to any assessments, reassessments,
levies, penalties or interest with respect to Taxes which will
result in any liability on its part in respect of any period ending
on prior to the Closing Date.
Page-29
(xi) Jurisdictions of Taxation. Except as provided in Schedule 3.2(hh),
to the knowledge of the Corporation, the Corporation has not been
and is not currently required to file any returns, reports,
elections, designations or other filings with any taxation
authority located in any jurisdiction outside of Canada.
(x) Related Party Transactions. The Corporation has not, and has never
been deemed to have for purposes of the ITA, acquired or had the
use of property for proceeds greater than the fair market value
thereof from, or disposed of property for proceeds less than the
fair market value thereof to, or received or performed services for
other than the fair market value from or to, or paid or received
interest or any other amount other than at a fair market value rate
to or from, any Person, firm or corporation with whom it does not
deal at arm's length within the meaning of the ITA.
(xi) Non-Capital Losses. The aggregate non-capital losses (as defined
in the ITA and the relevant provincial legislation) incurred in the
years ending on or prior to December 31, 2004 which could be
carried forward by the Corporation for federal income tax purposes
and for provincial income tax purposes are as indicated in
Schedule 3.2(hh). The expiry date of such losses of the
Corporation was as stated in note 10 of the Financial Statements.
(xii) SR&ED Expenditures. The aggregate amount of expenditures
qualifying as research and development expenditures under the ITA
and the relevant provincial legislation incurred by the Corporation
in years ending on or prior to December 31, 2004 which were not
deducted for income tax purposes and are available to be applied
against taxable income for years subsequent to the year ending
December 31, 2004 for federal income tax purposes and for
provincial income tax purposes are as indicated in
Schedule 3.2(hh).
(xiii) SR&ED Tax Credits. All research and development investment tax
credits ("ITCs") were claimed by the Corporation in accordance with
the ITA and the relevant provincial legislation and the Corporation
satisfied at all times the relevant criteria and conditions
entitling it to such ITCs. All refunds of ITCs received or
receivable by the Corporation in any financial year were claimed in
accordance with the ITA and the relevant provincial legislation and
the Corporation satisfied at all times the relevant criteria and
conditions entitling it to claim a refund of such ITCs. The
Corporation is entitled to receive the following ITCs refunds which
have not been collected yet: (A) for the year ending on
December 31, 2004, CDN$261,712 at the provincial level; and (B) the
refunds for the period commencing on January 1, 2005 and ending on
the Closing Date.
Page-30
(xiv) Capital Dividends and Rollovers. The Corporation has not filed or
been party to any election pursuant to Section 83 or 85 of the ITA
or the corresponding provisions of any provincial statute.
(xv) Forgiveness of Debt. Except as described in Schedule 3.2(hh), the
Corporation has not at any time benefited from a forgiveness of
debt or entered into any transaction or arrangement (including
conversion of debt into shares of its share capital) which could
have resulted in the application of section 80 and following of the
ITA.
(xvi) Tax Returns. The Corporation has made available to Purchaser or
its legal counsel, copies of all foreign, federal, state,
provincial, municipal and local income, added value, goods and
services and sales and use Tax Returns for the Corporation filed
for all periods terminating after December 31, 2004.
(xvii) Deductibility. As of Closing, there will not be any Contract, plan
or arrangement, covering any employee or former employee of the
Corporation that, individually or collectively, could give rise to
the payment of any amount that would not be deductible by the
Corporation as an expense under applicable Law other than
reimbursements of a reasonable amount of entertainment expenses and
other non-deductible expenses that are commonly paid by similarly
situated businesses in reasonable amounts.
(xviii) Tax Basis. The Corporation's cost amount, as defined in the ITA,
in respect of its assets is accurately reflected on the
Corporation's Tax Returns and records.
(ii) Competition Matters:
(i) For the purposes of and in accordance with the requirements of
section 110 of the Competition Act, as at the Closing Date:
(A) the aggregate value of the assets in Canada, determined as of
such time and in such manner as are prescribed by section 110
of the Competition Act and the Notifiable Transactions
Regulations under the Competition Act, that are owned by the
Corporation is about CDN$2,000,000; and
(B) the gross revenues from sales in or from Canada, determined
for such annual period and in such manner as are prescribed by
section 110 of the Competition Act and the Notifiable
Transactions Regulations under the Competition Act, generated
from the assets referred to in item (a) above, are about
CDN$500,000.
Page-31
(jj) Regulatory Permits. The Corporation possesses all certificates,
authorizations and permits issued by the appropriate federal,
provincial, local or foreign regulatory authorities necessary to conduct
its businesses as now conducted, except where the failure to possess
such permits could not, individually or in the aggregate, have or
reasonably be expected to result in a Material Adverse Effect, and the
Corporation has not received any notice of proceedings relating to the
revocation or modification of any such permits.
(kk) No Brokers, Etc. Other than the entity entitled to the Commission, no
broker, finder, agent or similar intermediary has acted on behalf of the
Corporation in connection with this Agreement or the transactions
contemplated hereby, and, other than the Commission, there are no
brokerage commissions, finders' fees or similar fees or commissions
payable by the Corporation in connection herewith.
(ll) Legal fees. The Corporation does not and will not owe any legal fees in
connection with this Agreement or the transactions contemplated hereby
and the legal fees that the Vendors are directing the Purchaser to pay
pursuant to Section 2.3(b) do not comprise any legal fees owing or
payable by the Corporation.
3.3 Full Disclosures.
No representation or warranty made by the Corporation pursuant to Section 3.2,
and no statement, schedule or certificate furnished or to be furnished to
Purchaser by the Corporation pursuant to this Agreement or any other
agreements, documents or other instruments executed and delivered by or on
behalf of the Corporation or any of its officers at the Closing or in
connection with the transactions contemplated hereby and thereby, contains or
will contain any untrue statement of a material fact, or omits or will omit to
state a material fact necessary to make the statements contained herein and
therein not misleading.
ARTICLE 4
REPRESENTATIONS AND WARRANTIES OF PURCHASER AND RAMTRON
-------------------------------------------------------
4.1 Representations and Warranties of Purchaser
Purchaser and Ramtron hereby solidarily represent and warrant to Vendors as
follows as of the date hereof and acknowledges and confirms that Vendors are
relying on such representations and warranties in connection with the sale by
Vendors of the Purchased Shares notwithstanding any investigation by, or
knowledge of, Vendors:
(a) Incorporation and Corporate Power. Purchaser is a corporation duly and
validly incorporated, organized and existing and in good standing under
the Laws of its jurisdiction of incorporation and has the corporate power
and authority to enter into and perform its obligations under this
Agreement.
Page-32
(b) Validity of Agreement. The execution, delivery and performance by
Purchaser of this Agreement:
(i) have been duly authorized by all necessary corporate action on the
part of Purchaser;
(ii) do not (or would not with the giving of notice, the lapse of time,
or both, or the happening of any other event or condition) result in
a breach or violation of, or conflict with, or allow any other
Person to exercise any rights under, any terms or provisions of its
constating documents or by-laws; and
(iii) will not result in the violation of any Law.
(c) Execution and Binding Obligation. This Agreement has been duly executed
and delivered by Purchaser and constitutes a legal, valid and binding
obligation of Purchaser, enforceable against it in accordance with its
terms subject only to any limitation under applicable Laws relating to
(i) bankruptcy, winding-up, insolvency, arrangement and other similar
Laws of general application affecting the enforcement of creditors'
rights and (ii) the discretion that a court may exercise in the granting
of extraordinary remedies such as specific performance and injunction.
(d) Required Authorizations. There is no requirement of Purchaser or any of
its Affiliates to make any filing with, give any notice to, or obtain any
Authorization of, any Governmental Entity as a condition to the lawful
completion of the transactions contemplated by this Agreement, except for
the filings, notifications and Authorizations described in
Schedule 4.1(d).
(e) No Brokers, Etc. No broker, finder, agent or similar intermediary has
acted on behalf of Purchaser in connection with this Agreement or the
transactions contemplated hereby, and, there are no brokerage
commissions, finders' fees or similar fees or commissions payable by
Purchaser in connection herewith.
4.2 Representations and Warranties of Ramtron
For the purposes of this Section, where applicable, Ramtron means Ramtron and
each of its subsidiaries, if any. Ramtron hereby represents and warrants to
Vendors as follows as of the date hereof and acknowledges and confirms that
Vendors are relying on such representations and warranties in connection with
the sale by Vendors of the Purchased Shares notwithstanding any investigation
by, or knowledge of, Vendors:
(a) Incorporation and Corporate Power. Ramtron is a corporation duly and
validly incorporated, organized and existing and in good standing under
the Laws of its jurisdiction of incorporation and has the corporate power
and authority to enter into and perform its obligations under this
Agreement.
Page-33
(b) Validity of Agreement. The execution, delivery and performance by
Ramtron of this Agreement:
(i) have been duly authorized by all necessary corporate action on the
part of Ramtron;
(ii) do not (or would not with the giving of notice, the lapse of time,
or both, or the happening of any other event or condition) result in
a breach or violation of, or conflict with, or allow any other
Person to exercise any rights under, any terms or provisions of its
constating documents or by-laws; and
(iii) will not result in the violation of any Law.
(c) Execution and Binding Obligation. This Agreement has been duly executed
and delivered by Ramtron and constitutes a legal, valid and binding
obligation of Ramtron, enforceable against it in accordance with its
terms subject only to any limitation under applicable Laws relating to
(i) bankruptcy, winding-up, insolvency, arrangement and other similar
Laws of general application affecting the enforcement of creditors'
rights and (ii) the discretion that a court may exercise in the granting
of extraordinary remedies such as specific performance and injunction.
(d) Required Authorizations. There is no requirement of Ramtron to make any
filing with, give any notice to, or obtain any Authorization of, any
Governmental Entity as a condition to the lawful completion of the
transactions contemplated by this Agreement, except for the filings,
notifications and Authorizations described in Schedule 4.2(d).
(e) No Brokers, Etc. No broker, finder, agent or similar intermediary has
acted on behalf of Purchaser in connection with this Agreement or the
transactions contemplated hereby, and, there are no brokerage
commissions, finders' fees or similar fees or commissions payable by
Purchaser in connection herewith.
(f) Issuance of Ramtron Stock. The Ramtron Stock, when issued in accordance
with this Agreement, will be duly authorized, validly issued, fully-paid
and non-assessable.
(g) Authorized and Issued Capital. The authorized capital stock of Ramtron
consists of 50,000,000 shares of Common Stock and 10,000,000 shares of
Preferred Stock (the "Ramtron Preferred Stock"). As of the date hereof,
22,434,192 shares of Ramtron Common Stock were issued and outstanding.
All of such outstanding shares of capital stock are validly issued, fully
paid and non-assessable.
(h) Subsidiaries. Except for the Purchaser and Mushkin, Inc. a Colorado
corporation, Ramtron has no subsidiaries and holds no shares or other
ownership, equity or proprietary interests in any other Person.
Page-34
(i) SEC Documents. Ramtron has timely filed with the United States
Securities and Exchange Commission (the "SEC") all of the documents that
Ramtron was required to file with the SEC from December 31, 2003 through
the date hereof (the "Ramtron SEC Documents"). Except as disclosed in
the Ramtron SEC Documents, as of their respective dates, the Ramtron SEC
Documents complied in all material respects with the requirements of the
Securities Act or the Exchange Act, as the case may be, and the rules and
regulations of the SEC then applicable to such Ramtron SEC Documents, and
none of the Ramtron SEC Documents, as of their respective dates,
contained any untrue statement of a material fact or omitted 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. Except as disclosed in the Ramtron SEC Documents,
the consolidated financial statements of Ramtron and its subsidiaries
included in the Ramtron SEC Documents complied as to form in all material
respects with the published rules and regulations of the SEC with
respect thereto, were prepared in accordance with general accounting
principles applied on a consistent basis during the periods involved
(except as may be indicated in the notes thereto or, in the case of the
unaudited statements, as permitted by Rule 10-01 of Regulation S-X) and
fairly presented in accordance with applicable requirements of generally
accepted accounting principles (subject, in the case of the unaudited
statements, to normal recurring adjustments, none of which were or will
be material) the consolidated financial position of Ramtron and its
subsidiaries as of their respective dates and the consolidated results of
operations and the consolidated cash flows of Ramtron and its
subsidiaries for the periods presented therein. For purposes of this
paragraph the italicized term "material" shall mean any non-compliance as
to form, or any misstatement or omission of a fact, that individually or
in the aggregate would result in an adverse change (A) in the capital,
consolidated assets, or consolidated liabilities of Ramtron of more than
Five percent (5.0%), or (B) in the consolidated gross income or
consolidated gross expenses of Ramtron of more than Ten percent (10.0%).
(j) No Material Adverse Change. Since June 30, 2005, there has been no
Material Adverse Change in the capital, business, assets, liabilities,
operations, properties, results of operation, prospects or condition
(financial or otherwise) of Ramtron and no event has occurred or
circumstances exist which may result in such a Material Adverse Change,
except as disclosed in the Ramtron SEC Documents, and there has been no
such Material Adverse Change which causes the Ramtron SEC Documents in
the aggregate to contain any untrue statement of a material fact or omit
to state any 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. For purposes of this paragraph the
italicized term "material" shall mean any misstatement or omission of a
fact that individually or in the aggregate would result in an adverse
change (A) in the capital, consolidated assets, or consolidated
liabilities of Ramtron of more than Five percent (5.0)%, or (B) in the
consolidated gross income or consolidated gross expenses of Ramtron of
more than Ten percent (10.0%);
Page-35
4.3 Full Disclosures.
No representation or warranty made by Purchaser and Ramtron in this Agreement,
and no statement, schedule or certificate furnished or to be furnished to
Vendors pursuant to this Agreement or any other agreements, documents or other
instruments executed and delivered by or on behalf of Ramtron or any of its
officers at the Closing or in connection with the transactions contemplated
hereby and thereby, contains or will contain any untrue statement of a
material fact, or omits or will omit to state a material fact necessary to
make the statements contained herein and therein not misleading.
ARTICLE 5
COVENANTS AND AGREEMENTS
------------------------
5.1 Covenants and Agreements of Vendors and of the Corporation
(a) Transfer of Documentation
(i) Except as otherwise provided in Section 5.1(a)(ii), on the Closing
Date, the Corporation shall deliver, to the Purchaser or make
available to it at the Corporation's premises the Books and Records
and all documents and other data, technical or otherwise relating to
the Corporation, its business or its assets. Purchaser shall
preserve all such documents delivered to it at or prior to the
Closing Date for a period of three years or such longer period as is
required by applicable law, and shall permit the Vendors or their
authorized representatives, subject to and if not in contravention
of any privacy acts and any other applicable legislation, and upon
written notice, reasonable access during regular business hours
while those documents are in the possession of the Purchaser solely
to the extent that such access is required by the Vendors to perform
their obligations under this Agreement or under applicable law but
Purchaser shall not be responsible or liable to any Vendor for, or
as a result of any loss or destruction of or damage to, any such
documents and other data unless such destruction, loss or damage is
caused by the Purchaser's gross negligence or wilful misconduct.
All reasonable out-of-pocket costs and expenses in connection with
any access contemplated by this Section 5.1(i) shall be borne by the
Party seeking access.
(ii) Notwithstanding Section 5.1(i), the Vendors shall be entitled to
retain copies of any documents or other data delivered to Purchaser
pursuant to Section 5.1 (a) provided that those documents or
data are reasonably required by the Vendors to perform their
obligations hereunder or under applicable law. The Vendors shall
retain any documents or data which relate to the Corporation and
which is retained by the Vendors pursuant to this Section in
confidence and shall not use or otherwise disclose the data or
information contained therein except as permitted by Section 9.5
Page-36
(b) Accredited Investors
(i) On the Closing Date, each of the Vendors receiving Ramtron Stock
shall qualify as an "accredited investors" as that term is defined
in Rule 501(a) of Regulation D promulgated under the Securities Act
and shall deliver to Purchaser any and all documentation necessary
to evidence same.
(c) Investigation
(i) During the Interim Period, Purchaser and its authorized
representatives shall be permitted to make such investigations,
inspections, surveys or tests of the Corporation, its business and
its assets, and of its financial and legal condition as Purchaser
deems necessary or desirable to familiarize itself with the
Corporation's business, assets and other matters. Without limiting
the generality of the foregoing, Purchaser shall, during normal
business hours, be permitted free and unrestricted access to (A) all
documents relating to information scheduled or required to be
disclosed under this Agreement, (B) the Books and Records, (C) the
Intellectual Property, (D) the Contracts, (E) the Leased Property,
(F) the employees of the Corporation, (G) records regarding
suppliers, customers and regulators, (H) environmental reports,
surveys, inspection reports, internal audits, manifests, incident
reports and any and all correspondence with Governmental Entities or
third parties in respect of environmental matters, and (I) all other
reports prepared by advisors of the Corporation and its Affiliates,
and the Corporation shall provide photocopies to Purchaser of all
such written information and documents as may be reasonably
requested by Purchaser.
(ii) At the request of Purchaser, the Corporation shall execute such
consents, authorizations and directions as may be necessary to
permit any inspection of the Corporation, its business and any of
its assets or to enable Purchaser or its authorized representatives
to obtain full access to all files and records relating to the
Corporation or relating to any of its assets maintained by
Governmental Entities and self-regulating authorities.
(iii) At Purchaser's request, the Corporation shall co-operate and assist
with Purchaser in arranging any meetings as Purchaser should
reasonably request with:
(A) employees of the Corporation;
(B) customers, suppliers, distributors or others who have or have
had a business relationship with the Corporation; and
(C) auditors, solicitors or any other Persons engaged or previously
engaged to provide services to the Corporation who have
knowledge of matters relating to the Corporation and its
business.
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(iv) Purchaser and its authorized representatives shall be permitted to
conduct all such testing and inspection in respect of environmental
matters at such locations of the Corporation's business as Purchaser
may determine, in its sole reasonable discretion, as may be required
to satisfy Purchaser in respect of such matters. The exercise of
any rights of inspection by or on behalf of Purchaser under this
Section 5.1(c) shall not mitigate or otherwise affect the
representations and warranties of the Corporation under this
Agreement, which shall continue in full force and effect as provided
in Section 8.3.
(d) Risk of Loss
During the Interim Period, the Corporation shall maintain in force all
the policies of business interruption insurance and of property damage
insurance under which any of its assets or its business are insured. If
before the Closing any of the assets or part of the business of the
Corporation is lost, damaged or destroyed and the loss, damage or
destruction constitutes a Material Adverse Change, then Purchaser at its
sole discretion may either:
(i) terminate this Agreement in accordance with the provisions of
Section 7.1(b); or
(ii) require the Vendors, who may, at their sole discretion, accept or
refuse such request, to reduce the Purchase Price by the amount of
the replacement cost of the assets and/or the business of the
Corporation which were lost, damaged or destroyed less the amount of
any proceeds of insurance payable as a result of the occurrence.
(e) Conduct Prior to Closing
Without in any way limiting any other obligations of the Corporation
hereunder, during the Interim Period:
(i) the Corporation shall conduct its business, operations and affairs
in the Ordinary Course, and the Corporation shall not, without the
prior written consent of Purchaser, enter into any transaction or
refrain from doing any action that, if effected before the date of
this Agreement, would constitute a breach of any representation,
warranty, covenant or other obligation of the Corporation in this
Agreement and, without limiting the generality of the foregoing, the
Corporation shall not:
(A) amalgamate, merge or consolidate with or acquire or agree to
acquire all or substantially all of the shares and assets of
any Person, not to acquire or lease or agree to acquire or
lease any business operations or any equity interests in any
other Person, not to acquire or agree to acquire any legal or
beneficial interest in any real property or not to occupy,
lease, manage or control or agree to occupy, lease or manage or
control any facility or property;
Page-38
(B) do any act or thing of the kind described in Section 3.2(j);
(C) enter into any compromise or settlement of any litigation,
proceeding or government investigation relating to the business
or any of the assets of the Corporation;
(D) make any Material modification to its usual sales, human
resource, accounting, software, or management practices,
processes or systems;
(E) enter into any Contract of the kind described in
Section 3.2(s);
(F) move any Material part of its business to any other location
from which the Corporation does not carry on its business at
the date hereof; or
(G) make any change to its constating documents;
(ii) the Corporation shall use its best efforts:
(A) to continue to maintain in full force and effect all the
insurance policies or renewals thereof currently in effect; and
(B) to report all claims or known circumstances or events which may
give rise to a claim to its insurers under the insurance
policies in a due and timely manner to the Closing Date and to
provide copies of those reports to Purchaser;
(iii) the Corporation shall use its best efforts to obtain, the Consents
described in Schedules 3.2(c);
(iv) the Corporation shall use its best efforts to preserve intact its
business, assets, operations and affairs and to carry on its
business and affairs as currently conducted, and to promote and
preserve for Purchaser the goodwill of suppliers, customers and
others having business relations with the Corporation;
(v) the Corporation shall pay and discharge the liabilities of the
Corporation in the Ordinary Course in accordance and consistent with
the previous practice of the Corporation, except those contested in
good faith by the Corporation;
(vi) the Corporation shall take, all necessary corporate action, steps
and proceedings to approve or authorize, validly and effectively,
the execution and delivery of this Agreement and the other
agreements and documents contemplated hereby and to complete the
transfer of the Purchased Shares to Purchaser and to cause all
necessary meetings of directors and shareholders of the Corporation
to be held for that purpose; and
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(viii) the Corporation shall periodically report to Purchaser as it may
reasonably request concerning the state of the Corporation, its
business and its assets.
(f) Regulatory Approvals
The Corporation shall co-operate, with Purchaser and render all necessary
assistance required by Purchaser in connection with any application,
notification or filing of Purchaser to or with the Bureau of Competition
Policy pursuant to the Competition Act.
(g) Expenses
The Corporation, each Vendor and Purchaser and Ramtron shall bear their
respective expenses incurred in connection with the investigation,
negotiation, preparation, execution and performance of this Agreement and
transactions contemplated hereby and thereby, including, without
limitation, all fees and expenses of brokers, agents, representatives,
counsel and accountants. All retainer and success fees due and paid or
payable to SVB Alliant pursuant to a certain engagement letter between
the Corporation and SVB Alliant dated on or about January 27, 2005 will
be paid directly to SVB Alliant out of the Purchase Price at Closing
pursuant to the direction of payment by the Vendors to Purchaser pursuant
to Section 2.3(a).
(h) Public Announcements
Any press release or public announcement by the Corporation or any
Designated Vendor with respect to this Agreement or to the transactions
contemplated hereby shall not be made without Purchaser's prior consent,
provided that the Corporation or a Designated Vendor shall not be
prevented from making such disclosure if it shall be advised by counsel
that such disclosure is required by law; provided further, that to the
extent disclosure is so required by applicable law, such party intending
to make such release shall use its best efforts consistent with such
applicable law to consult with Purchaser with respect to the text
thereof. Purchaser will be deemed to have consented to the making of a
press release or a public announcement if it does not object thereto
before 5:00 P.M. (Montreal Time) on the Business Day following the
Corporation's or the Designated Vendor's request.
(i) No Solicitation
The Corporation, its officers and directors, and the Designated Vendors
shall not, and shall cause their respective affiliates and
representatives (including, without limitation, investment bankers,
attorneys and accountants) not to, directly or indirectly, through any
officer, director, agent or otherwise, enter into, solicit, initiate,
conduct or continue any discussions or negotiations with, or encourage or
respond to any inquiries or proposals by, or provide any information to,
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or otherwise cooperate in any other way with, any corporation,
partnership, person or other entity or group, other than Purchaser,
concerning any sale of all or any material portion of the assets of or
the business of, or any material number of shares of capital stock of or
other securities in, the Corporation, or any merger, consolidation,
recapitalization, liquidation, dissolution or similar transaction
involving the Corporation or any license, joint venture, partnership,
collaboration or similar arrangement directly or indirectly involving the
Corporation, or engage in a public or private offering of shares of its
capital stock (any of the foregoing transactions, a "Prohibited
Transaction"). Without limiting the foregoing, it is agreed that any
violation of the restrictions set forth in the preceding sentence by any
representative or agent of the Corporation or Designated Vendor shall be
a breach of this Section 5.10 by the Corporation or a Designated
Vendor, as applicable. Each of the Designated Vendors and the Corporation
hereby represents that it is not now engaged in discussions or
negotiations with any party other than Purchaser with respect to any
Prohibited Transaction. None of the Designated Vendors will vote any of
their respective shares of the capital stock of the Corporation in favour
of any Prohibited Transaction, except for the transaction contemplated by
this Share Purchase Agreement. Each Designated Vendor, the Corporation
and its officers and directors shall promptly notify Purchaser (orally
and in writing) if any offer is made to it, any discussions or
negotiations are sought to be initiated with it, any inquiry, proposal or
contact is made or any information is requested from it with respect to
any Prohibited Transaction.
(j) Security Interests
The Corporation shall ensure that any Liens, except for the Permitted
Liens, affecting the assets of the Corporation, including without
limitation security interests held by Investissement Quebec, Fonds and
BDC shall have been discharged.
5.2 Covenants and Agreements of Purchaser and Ramtron
(a) Resale Registration Statement
Ramtron shall file a registration statement with the SEC on Form S-3
(such registration statement to be referred to hereinafter as the "Resale
Registration Statement") to register for resale all of the Ramtron Stock
(the "Registration Shares") by the Vendors who receive such Ramtron Stock
("Holders") pursuant to this Agreement, subject to and in accordance with
the terms and conditions of this Agreement relating to such registration,
not later than thirty (30) days after the Closing Date.
(b) Registration
Ramtron shall use necessary efforts, acting reasonably, to cause the
Resale Registration Statement to become effective as soon as practicable
after its filing with the SEC.
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(c) Expenses
Ramtron shall pay all registration expenses and other expenses incurred
by Ramtron in complying with its obligations under this Section 5.2
including, without limitation, all SEC and blue sky registration and
filing fees, printing expenses, exchange listing fees, transfer agents'
and registrars' fees, and the fees and disbursements of Ramtron's outside
counsel. Ramtron shall not be responsible for any selling expenses
including, without limitation, any underwriters' or brokers' fees or
discounts relating to the Registration Shares, or the fees or expenses of
separate counsel to the Holders, all of which will be solely for the
account of the Holders.
(d) Obligations of Ramtron
In connection with the registration of Registration Shares contemplated
by Section 5.2(a) above, Ramtron shall:
(i) Prepare and file with the SEC the Resale Registration Statement and
such amendments and supplements to the Resale Registration Statement
and the prospectus used in connection therewith and any post-
effective amendments or other forms or filings as may be necessary
to comply with the provisions of the Securities Act.
(ii) Furnish to the Holders such number of copies of the Resale
Registration Statement and the prospectus included therein
(including each preliminary prospectus) as they may reasonably
request in order to facilitate the intended disposition of the
Registration Shares covered by such Resale Registration Statement.
(iii) Use reasonable efforts to register and qualify the Registration
Shares covered by such Resale Registration Statement or file such
notifications or pay such fees under the securities or blue sky laws
of each state of the United States as may be necessary for the
Holders of Registration Shares to effect the sale of their
securities pursuant to the Resale Registration Statement and use
such reasonable efforts to register and qualify the Registration
Shares under the securities laws of the Province of Quebec and such
other jurisdictions as shall be reasonably requested by the Holders;
provided that Ramtron shall not be required in connection therewith
or as a condition thereto to qualify to do business or to file a
general consent to service of process in any such states or
jurisdictions.
(iv) Notify each Holder of Registration Shares covered by such Resale
Registration Statement at any time when a prospectus relating
thereto is required to be delivered under the Securities Act of the
happening of any event as a result of which the prospectus included
in such Resale Registration Statement, as then in effect, includes
an untrue statement of a material fact or omits to state a material
fact required to be stated therein or necessary to make the
statements therein not misleading in the light of the circumstances
then existing.
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(v) cause all such Registration Shares covered to be listed on each
securities exchange or nationally recognized quotation system on
which similar securities issued by Ramtron are then listed
(e) Requirement to Keep Effective
(f) Ramtron shall, subject to Section 5.2(g) below, use its reasonable
efforts to keep such Resale Registration Statement continuously effective
until the second anniversary of the effective date of the Resale
Registration Statement.Notification
Ramtron shall notify the Holders (i) when a prospectus or any prospectus
supplement or post-effective amendment has been filed, and, with respect
to the Resale Registration Statement or any post-effective amendment,
when the same has become effective; (ii) of any request by the SEC or any
other federal or state governmental authority during the period of
effectiveness of the Resale Registration Statement for amendments or
supplements to the Resale Registration Statement or related prospectus or
for additional information relating to the Resale Registration Statement;
(iii) of the issuance by the SEC or any other federal or state
governmental authority of any stop order suspending the effectiveness of
the Resale Registration Statement or the initiation of any proceedings
for that purpose; (iv) of the receipt by Ramtron of any notification with
respect to the suspension of the qualification or exemption from
qualification of any of the Registration Shares for sale in any
jurisdiction or the initiation or threatening of any proceeding for such
purpose; or (v) of the happening of any event which makes any statement
made in the Resale Registration Statement or related prospectus or any
document incorporated or deemed to be incorporated therein by reference
untrue in any material respect or which requires the making of any
changes in the Resale Registration Statement or prospectus so that, in
the case of the Resale Registration Statement, it will not contain any
untrue statement of a material fact or omit to state any material fact
required to be stated therein or necessary to make the statements therein
not misleading, and that in the case of the prospectus, it will not
contain any untrue statement of a material fact or omit to state any
material fact required to be stated therein or necessary to make the
statements therein, in the light of the circumstances under which they
were made, not misleading.
(g) Suspension
Ramtron may either: (A) upon the happening of any event of the kind
described in clause (ii), (iii), (iv), or (v) of Section 5.2(f) above; or
(B) based upon the reasonable advice of its financial advisor in
connection with any significant financing transaction for its account;
suspend the effectiveness of the Resale Registration Statement and use of
the prospectus upon written notice to the Holders. In such case all
Holders shall discontinue disposition of the Registration Shares covered
by the Resale Registration Statement or prospectus until copies of a
Page-43
supplemented or amended prospectus are distributed to them or until they
are advised in writing by Ramtron that the use of the applicable
prospectus may be resumed. However, except in the case of an event
described in Section 5.2 (f) (ii), (iii) and (iv), Ramtron shall not be
entitled to exercise its rights of suspension pursuant to this provision
after a date which is more than two (2) years immediately following the
Closing Date and more than once in any twenty-four (24) month period, and
for no more than ninety (90) consecutive days. Ramtron shall use
necessary efforts, acting reasonably, to ensure that the use of the
prospectus may be resumed as soon as practicable. The two year period
referenced in clause (i) of Section 5.2(e) above during which Ramtron is
to keep the Resale Registration Statement effective shall be extended for
a number of days equal to the number of days during which Ramtron has
suspended the use of the Resale Registration Statement pursuant to this
Section 5.2(g). Ramtron shall use every reasonable effort to obtain the
withdrawal of any order suspending the effectiveness of the Resale
Registration Statement, or the lifting of any suspension of the
qualification (or exemption from qualification) of any of the securities
for sale in any jurisdiction, at the earliest practicable moment.
Ramtron shall, upon the occurrence of any event contemplated by clause
(v) of Section 5.2(f) above, prepare a supplement or post-effective
amendment to the Resale Registration Statement or a supplement to the
related prospectus or any document incorporated therein by reference or
file any other required document so that, as thereafter delivered to
buyers of the Registration Shares being sold thereunder, such prospectus
will not contain an 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.
(h) Holders Obligation to Furnish Information
Ramtron shall not be required to include any Registration Shares of a
Holder in the Resale Registration Statement unless such Holder shall
furnish to Ramtron such information regarding itself, the Registration
Shares held by such Holder, and the intended method of disposition of
such securities as shall be required, in the reasonable opinion of
Ramtron, to effect the registration of such Holder's Registration Shares.
(i) Public Announcement
Any press release or public announcement by Purchaser and Ramtron with
respect to this Agreement or to the transactions contemplated hereby
shall not be made without the Corporation's and the Designated Vendors'
prior consent, provided that Purchaser or Ramtron shall be permitted to
make any press release or public announcement or disclosures required by
law, including the Securities Act and the Exchange Act, or any Nasdaq
rule.
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(j) No Solicitation and No Hire
From the date hereof until the Closing, Ramtron and Purchaser their
officers and directors shall not, and shall cause their respective
affiliates and representatives not to, directly or indirectly, through
any officer, director, agent or otherwise, 1) employ any employee of the
Corporation or 2) solicit, initiate contact with, conduct or continue any
discussions or negotiations with, or encourage any employee of Goal for
the purpose of (i) offering him or her employment with any person other
than the Corporation or (ii) retaining him or her to provide any services
to any Person other than the Corporation.
Should the Closing not take place, from the date hereof until the date
that is 3 years after, Ramtron and Purchaser their officers and directors
shall not, and shall cause their respective affiliates and
representatives not to, directly or indirectly, through any officer,
director, agent or otherwise, 1) employ any employee of the Corporation
or 2) solicit, initiate contact with, conduct or continue any discussions
or negotiations with, or encourage any employee of Goal for the purpose
of (i) offering him or her employment with any person other than the
Corporation or (ii) retaining him or her to provide any services to any
Person other than the Corporation.
ARTICLE 6
CLOSING ARRANGEMENTS
--------------------
6.1 Date, Time and Place of Closing
The Closing is taking place at the offices of ▇▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇▇ LLP, 1000
de La ▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇ ▇▇▇, ▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇ ▇▇▇ ▇▇▇, at 2:00 p.m.
(eastern time) on the Closing Date.
6.2 Vendors' Closing Deliveries
At the Closing, each Vendor, acting jointly (within the meaning of the Civil
Code of Quebec) shall deliver to the Purchaser the following with respect to
itself only:
(a) certificates representing the Purchased Shares held by Vendor,
accompanied by share transfer powers duly executed in blank or duly
executed instruments of transfer, and all such other assurances, consents
and other documents as Purchaser may reasonably request to effectively
transfer to Purchaser title to the Purchased Shares free and clear of all
Liens;
(b) a copy of an escrow agreement in the form of Exhibit "A" (the "Escrow
Agreement") bearing said Vendor's signature;
(c) releases by Vendor as shareholders of the Corporation substantially in
the form attached as Exhibit "B" bearing said Vendor's signature;
Page-45
(d) a copy of documents and agreements as may be necessary to terminate the
Shareholders' Agreement bearing said Vendor's signature;
(e) if the Vendor is a Corporation, a certificate of status or its equivalent
under the laws of the jurisdiction governing its corporate existence;
(f) a certificate of each Vendor in respect of its representations and
warranties set out in Section 3.1 substantially in the form of Exhibit
"C";
(g) if the Vendor is a Corporation, an opinion from said Vendor's Counsel,
addressed to Purchaser and ▇▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇▇ LLP dated the Closing
Date, in form and substance satisfactory to Purchaser, acting reasonably,
as to the matters described in Exhibit "D"
6.3 Corporation's Closing Deliveries
At Closing, the Corporation shall deliver the following:
(a) Corporate Records;
(b) make available all other Books and Records;
(c) a certified copy of a resolution of the board of directors and of the
shareholders of the Corporation consenting to the transfer of the
Purchased Shares from the Vendors to Purchaser as contemplated by this
Agreement and authorizing the execution, delivery and performance of all
contracts, agreements, instruments, certificates and other documents
required by this Agreement to be delivered by the Corporation;
(d) the Corporation shall have delivered to Purchaser a certificate of the
Secretary of the Corporation dated the Closing Date as to (a) the
Articles of Incorporation and By-Laws of the Corporation, as in effect on
and as of the Closing Date, (b) the resolutions of the Board of Directors
of the Corporation authorizing and approving the execution, delivery and
performance by the Corporation of this Agreement and all transactions
related hereto, and (c) the incumbency of officers of the Corporation
executing documents executed and delivered in connection herewith;
(e) the Corporation shall have obtained and delivered to Purchaser all
consents and approvals of Governmental Entities and other parties that
are required in connection with the Closing under this Agreement, the
performance by the Corporation of its obligations hereunder or the
continuance of any of the Contracts by the Corporation after the Closing
Date;
(f) the Corporation shall have delivered to Purchaser the Closing Date
Balance Sheet;
Page-46
(g) each employee of the Corporation as of the date of this Agreement whose
duties involve creation, analysis or other work with any confidential
information relating to the Intellectual Property and each employee hired
by the Corporation since that date who are not already bound by an
agreement obligating such person not to disclose any such confidential
information and to assign to the Corporation any Intellectual Property
developed in the course of their employment or engagement in a form
acceptable to Purchaser shall execute such an agreement and shall execute
and deliver such further releases and acknowledgements related thereto in
a form reasonably satisfactory to Purchaser;
(h) no options or warrants to purchase shares of the Corporation, other than
the options to be purchased by Buyer, shall be outstanding as of the
Closing and the Corporation shall have obtained from each person holding
such options or warrants acknowledgment of cancellation of such options
or warrants and a full and final release in favour of the Corporation
with respect to such options or warrants in form and substance acceptable
to Purchaser;
(i) written resignations of those directors and officers of the Corporation
as Purchaser may specify, in each case with effect from the Closing Date,
together with releases by those Persons substantially in the form
attached as Exhibit "E";
(j) in respect of the Corporation, a certificate of status or its equivalent
under the laws of the jurisdiction governing its corporate existence;
(k) a certificate of the President and Chief Executive Officer and the Chief
Financial Officer of the Corporation in respect of the representations
and warranties set out in Section 3.2 and the covenants and other
obligations set out in this Agreement substantially in the form of
Exhibit "F";
(l) a favourable opinion of the Corporation's Counsel, addressed to Purchaser
and ▇▇▇▇▇▇ ▇▇▇▇▇▇ Gervais LLP dated the Closing Date, in form and
substance satisfactory to Purchaser, acting reasonably, as to the matters
described in Exhibit "G";
(m) Investissement Quebec, Fonds and BDC shall have delivered duly executed
releases and discharges in form satisfactory to Purchaser's counsel
further to the repayment by Purchaser of their loans to the Corporation;
and
(n) such other documentation as Purchaser may reasonably request in order to
establish the completion of the Transactions and the taking of all
corporate proceedings in connection with the Transactions (as to
certification and otherwise), in each case in form and substance
satisfactory to Purchaser, acting reasonably.
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6.4 Purchaser's and Ramtron's Closing Deliveries
At the Closing, Purchaser and/or Ramtron shall deliver or cause to be
delivered to the Vendors the following:
(a) payment of the amounts required to be paid under Section 2.2;
(b) proof that it has reimbursed all amounts owed to BDC and Fonds pursuant
to the shareholder loans described in Schedule 1.1(ii);
(c) certificates representing the Ramtron Stock registered in the name of the
Designated Vendors as provided in Schedule 2.3 provided that 10% of such
Ramtron Stock will be delivered to the Escrow Agent pursuant to the terms
of the Escrow Agreement;
(d) receipts for the certificates representing the Purchased Shares;
(e) in respect of each of Purchaser and Ramtron:
(i) a certificate of status or its equivalent under the laws of the
jurisdiction of its incorporation/governing its corporate existence;
(ii) a certificate of incumbency; and
(iii) that number of copies reasonably required by the Vendors, certified
by one of its senior officers, of its Constating Documents and of
the resolutions of the board of directors and (if required by
Applicable Law) shareholders of Purchaser authorizing its execution,
delivery and performance of this Agreement and of all contracts,
agreements, instruments, certificates and other documents required
by this Agreement to be delivered by Purchaser; and
(f) a certificate of Purchaser in respect of its representations and
warranties set out in Section 4.1 and in respect of its covenants and
other obligations set out in this Agreement substantially in the form of
Exhibit "H";
(g) a certificate of Ramtron in respect of its representations and warranties
set out in Section 4.2 and in respect of its covenants and other
obligations set out in this Agreement substantially in the form of
Exhibit "I";
(h) the Escrow Agreement, duly executed by Purchaser and Ramtron;
(i) a favourable opinion of Purchaser's Counsel, addressed to the Vendors and
dated the Closing Date, in form and substance satisfactory to the
Vendors, acting reasonably, as to the matters described in Exhibit "J";
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(j) a favourable opinion of the Ramtron's Counsel, addressed to the Vendors
and Purchaser's counsel and dated the Closing Date, in form and substance
satisfactory to the Vendors, acting reasonably, as to the matters
described in Exhibit "K"; and
(k) such other documentation as the Designated Vendors may reasonably request
in order to establish the completion of the Transactions and the taking
of all corporate proceedings in connection with the Transactions (as to
certification and otherwise), in each case in form and substance
satisfactory to the Designated Vendors, acting reasonably.
ARTICLE 7
CONDITIONS OF CLOSING
---------------------
7.1 Purchaser's Conditions
(a) Purchaser shall be obliged to complete the Transactions only if each of
the following conditions precedent has been satisfied in full at or
before the Closing Date (each of which conditions precedent is
acknowledged to be for the exclusive benefit of Purchaser):
(i) all of the representations and warranties of each of the Vendors
made in this Agreement shall be true and correct as at the Closing
Date with the same effect as if made at and as of the Closing Date
(except as those representations and warranties may be affected by
events or transactions (A) expressly permitted by this Agreement, or
(B) approved in writing by Purchaser) and without giving effect to
any supplements to any disclosure schedules provided after the date
hereof;
(ii) all of the representations and warranties of the Corporation made in
this Agreement shall be true and correct as at the Closing Date with
the same effect as if made at and as of the Closing Date (except as
those representations and warranties may be affected by events or
transactions (A) expressly permitted by this Agreement, or (B)
approved in writing by Purchaser) without giving effect to any
supplements to any disclosure schedules provided after the date
hereof;
(iii) each Vendor shall have complied with or performed all of the
obligations, covenants and agreements under this Agreement to be
complied with or performed by said Vendor at or before the Closing
Date, including the Vendors' Closing deliveries specified in
Section 6.2, to the satisfaction of Purchaser, acting reasonably;
(iv) the Corporation shall have complied with or performed all of the
obligations, covenants and agreements under this Agreement to be
complied with or performed by the Corporation at or before the
Closing Date, including the Corporation's Closing deliveries
specified in Section 6.3, to the satisfaction of Purchaser, acting
reasonably;
Page-49
(v) all Consents described in Schedule 3.2(c) shall have been obtained,
in each case in form and substance satisfactory to Purchaser, acting
reasonably or waived by Purchaser;
(vi) all documentation relating to the Transactions is satisfactory to
Purchaser, acting reasonably, including the Escrow Agreement and the
escrow of the Escrow Shares and the Deposit, as hereinafter defined,
for the purposes of securing some of the indemnities by Designated
Vendors hereto has been duly made;
(vii) there shall be no injunction or restraining order issued preventing,
and no pending or threatened claim, against any Party, for the
purpose of enjoining or preventing, the completion of the
Transactions or otherwise claiming that this Agreement or the
completion of the Transactions is improper or would give rise to a
claim under any applicable law;
(viii) no applicable law shall have been enacted, introduced or announced
which may have a Material Adverse Effect;
(ix) there shall have been no Material Adverse Change since the Balance
Sheet Date;
(x) the sale and delivery of the Ramtron Stock to the Designated Vendors
is exempt from the requirement to file a prospectus and the
requirement to deliver an offering memorandum under any applicable
statute relating to the sale of the Ramtron Stock or upon the
issuance of such orders, consents or approvals as may be required to
permit such sale without the requirement of filing a prospectus or
delivering an offering memorandum.
(b) If any of the conditions in Section 7.1(a)shall not be satisfied or
fulfilled in full at or before the Closing Time to the satisfaction of
Purchaser, Purchaser in its sole discretion may, without limiting any
rights or remedies available to Purchaser at law or in equity, either:
(i) terminate this Agreement by notice in writing to the Vendors, except
with respect to the obligations contained in Sections 8.1 and 9.5
which shall survive that termination; or
(ii) waive compliance with any such condition in whole or in part by
notice in writing to the Vendors, except that no such waiver shall
operate as a waiver of any other condition.
7.2 Vendors' Conditions
(a) The Vendors acting jointly (within the meaning of the Civil Code of
Quebec) shall be obliged with respect to itself only to complete the
Transactions only if each of the following conditions precedent has been
satisfied in full at or before the Closing Date (each of which conditions
precedent is acknowledged to be for the exclusive benefit of the
Vendors):
Page-50
(i) all of the representations and warranties of Purchaser and Ramtron
made in this Agreement shall be true and correct as at the Closing
Date with the same effect as if made at and as of the Closing Date
(except as those representations and warranties may be affected by
events or transactions expressly permitted by or resulting from the
entering of this Agreement);
(ii) Purchaser and Ramtron shall have complied with or performed all of
the obligations, covenants and agreements under this Agreement to be
complied with or performed by Purchaser and Ramtron at or before the
Closing Date, including Purchaser's and Ramtron's Closing
deliveries specified in Section 6.4, to the satisfaction of the
Designated Vendors acting reasonably;
(iii) all Authorizations described in Schedule 0 required from all
relevant Governmental Entities to permit the completion of the
Transactions shall have been obtained;
(iv) all Consents described in Schedule 3.2(c) shall have been waived by
Vendors or obtained, in each case in form and substance satisfactory
to the Vendors, acting reasonably;
(v) there shall be no injunction or restraining order issued preventing,
and no pending or threatened claim against any Party for the purpose
of enjoining or preventing, the completion of the Transactions or
otherwise claiming that this Agreement or the completion of the
Transactions is improper or would give rise to a claim under any
applicable law;
(vi) no applicable law shall have been enacted, introduced or announced
which may have a Material Adverse Effect on Purchaser or Ramtron;
and
(vii) there shall have been no Material Adverse Change regarding Ramtron
during the Interim Period.
(b) If any of the conditions in Section 7.2(a) shall not be satisfied or
fulfilled in full at or before to the Closing Date to the satisfaction of
the Designated Vendors, acting reasonably, the Designated Vendors in
their sole discretion may, without limiting any rights or remedies
available to the Vendors at law or in equity, either:
(i) terminate this Agreement by notice in writing to Purchaser, except
with respect to the obligations contained in Sections 8.2 and 9.5
which shall survive that termination; or
(ii) waive compliance with any such condition in whole or in part by
notice in writing to Purchaser, except that no such waiver shall
operate as a waiver of any other condition.
Page-51
ARTICLE 8
INDEMNIFICATION
---------------
8.1 Indemnification in Favour of Purchaser
(a) Each Vendor shall jointly indemnify and save Purchaser and Ramtron
harmless of and from any loss, liability, claim, damage or expense
(whether or not involving a third-party claim) including reasonable legal
expenses but excluding any indirect, special or consequential damages
(collectively, "Damages") suffered by, imposed upon or asserted against
Purchaser, Ramtron or the Corporation as a result of, in respect of,
connected with, or arising out of, under, or pursuant to:
(i) any failure of said Vendor to perform or fulfill any of its
covenants under this Agreement at any time; and
(ii) any breach or inaccuracy of any representation or warranty given by
said Vendor pursuant to Section 3.1 hereof, without giving effect to
any supplements to any disclosure schedules provided after the date
hereof.
(b) The Designated Vendors shall solidarily indemnify and save Purchaser and
Ramtron harmless of and from any loss, liability, claim, damage or
expense (whether or not involving a third-party claim) including
reasonable legal expenses but excluding any indirect, special or
consequential damages (collectively, "Damages") suffered by, imposed upon
or asserted against Purchaser, Ramtron or the Corporation as a result of,
in respect of, connected with, or arising out of, under, or pursuant to:
(i) any failure of the Corporation to perform or fulfill any of its
covenants under this Agreement at any time; and
(ii) any breach or inaccuracy of any representation or warranty given by
the Corporation pursuant to Sections 3.2 and 3.3 hereof, without
giving effect to any supplements to any disclosure schedules
provided after the date hereof.
The amounts of any Damages incurred shall be determined by taking into
account any net offsetting actual tax benefits or permissible tax
deductions that may be available in relation to the matter which is the
cause of such Damages, net of the costs of any re-filing of tax returns,
including professional fees.
(c) For the purposes of calculating any "Damages" pursuant to sections
8.1 (a) and 8.1 (b), it is expressly agreed that there shall not be any
duplication of the Damages suffered by Purchaser and Ramtron, as the case
may be.
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8.2 Indemnification in Favour of Vendors
(a) Purchaser and Ramtron shall solidarily indemnify and save Vendors
harmless of and from any Damages suffered by, imposed upon or asserted
against Vendors as a result of, in respect of, connected with, or arising
out of, under or pursuant to:
(i) any failure of Purchaser to perform or fulfill any covenant of
Purchaser under this Agreement; and
(ii) any breach or inaccuracy of any representation or warranty given by
Purchaser contained in this Agreement, without giving effect to any
supplements to any disclosure schedules provided after the date
hereof.
(b) Ramtron shall indemnify and save Vendors harmless of and from any Damages
suffered by, imposed upon or asserted against Vendors as a result of, in
respect of, connected with, or arising out of, under or pursuant to:
(i) any failure of Ramtron to perform or fulfill any covenant of Ramtron
under this Agreement; and
(ii) any breach or inaccuracy of any representation or warranty given by
Ramtron contained in this Agreement, without giving effect to any
supplements to any disclosure schedules provided after the date
hereof.
8.3 Time Limitations
(a) The representations and warranties of Vendors contained in this Agreement
pursuant to Section 3.1 hereof shall survive Closing and, notwithstanding
Closing and any investigation made by or on behalf of Purchaser, shall
continue for a period of one year after Closing, except that a claim for
any breach of any of the representations and warranties in Section 3.1
hereof involving fraud or fraudulent misrepresentation or any breach of
the representation and warranty in Sections 3.1(a), 3.1(c) and 3.1(d)
shall survive and continue in full force and effect without limitation of
time.
(b) The representations and warranties of the Corporation contained in
Sections 3.2 and 3.3 hereof shall survive Closing and, notwithstanding
Closing and any investigation made by or on behalf of Purchaser, shall
continue for a period of one year after Closing, except that:
(i) the representations and warranties set out in Section 3.2(hh) (Tax
Matters) shall survive for a period of three (3) years after Closing
in the case of BDC and Fonds only (it being understood that in the
case of Investissement Technologie and Vision2000 these
representations and warranties are for only one year); and
Page-53
(ii) a claim for any breach of any of the representations and warranties
involving fraud or fraudulent misrepresentation shall survive and
continue in full force and effect for a period of three (3) years
after Closing in the case of BDC and Fonds only (it being understood
that in the case of Investissement Technologie and Vision2000 these
representations and warranties are for only one year).
(c) The representations and warranties of Purchaser and Ramtron contained in
this Agreement shall survive Closing and, notwithstanding Closing and any
investigation made by or on behalf of Vendors, shall continue for a
period of one year after Closing, except that a claim for any breach of
any representations and warranties of Purchaser or Ramtron contained in
this Agreement involving fraud or fraudulent misrepresentation shall
survive and continue in full force and effect for a period of three (3)
years after Closing.
(d) All claims for indemnification made pursuant to this Agreement must be
notified to the other party or parties, as the case may be, within the
applicable time limitations of the representations and warranties set
forth in this Section 8.3.
8.4 Limitation on Damages
(a) The covenants of each Vendor under this Agreement and the representations
and warranties of each Vendor in Section 3.1 and the indemnification
obligations in Section 8.1(a) are joint (within the meaning of the Civil
Code of Quebec) representations, warranties, covenants and
indemnification obligations of each such Vendor (collectively, the "Joint
Representations and Covenants"). Accordingly, the particular Vendor
making the Joint Representations and Covenants will be solely liable for
such Joint Representations and Covenants as they pertain to itself, but
not as they pertain to the other Vendors. Notwithstanding anything else
contained herein, the indemnification obligations of the Designated
Vendors pursuant to Sections 8.1(b) hereof are made solidarily (within
the meaning of the Civil Code of Quebec) by each of the Designated
Vendors in accordance with the terms of this Agreement without the
benefit of division or discussion save and except for the indemnification
obligations of the Vendors pursuant to Section 8.3(b) after the period of
one year mentioned therein which shall continue to be made solidarily
between BDC and Fonds only (collectively, the "Solidary
Representations"). Accordingly, each of the Designated Vendors will be
solidarily liable to Purchaser and for any breach of any Solidary
Representations hereof to the extent provided in this Article 8.
(b) The indemnification obligations pursuant to Section 8.1 shall only apply
to the aggregate Damages of Purchaser and Ramtron with respect to all
indemnification claims pursuant to Section 8.1 (other than
indemnification claims with respect to the Vendors' Core Representations
and claims based on fraud or fraudulent misrepresentation of Vendors,
which claims shall not be subject to the limitations set forth in this
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Section 8.4(b) or to the 87.5% limitation hereinafter provided) which
exceed U.S.$100,000, upon which the obligations of indemnification of
Vendors for breaches of such representations and warranties shall apply
to the Eighty Seven and one-half percent (87.5%) of the amount of such
Damages. Claims relating to breaches of Vendors' Core Representations
and claims based on fraud or fraudulent misrepresentation shall not count
towards determining whether the threshold indemnification amount in this
Section has been exceeded. The Vendors agree that the remaining Twelve
and one-half percent (12.5%) of the aggregate Damages of Purchaser and
Ramtron (other than indemnification claims with respect to the Vendors'
Core Representations and claims based on fraud or fraudulent
misrepresentation made by the Vendors) shall be indemnified by the
deposit (the "Deposit") by ▇▇▇ ▇▇▇▇▇▇▇▇▇ and ▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇ of
Sixty-Two Thousand Five Hundred US Dollars (US $62,500 ) with the Escrow
Agent pursuant to the Escrow Agreement thereto. It is also agreed and
understood that for the purposes herein the "Indemnifying Party", as
hereinafter defined, shall remain the Vendors and shall not be deemed to
be ▇▇▇ ▇▇▇▇▇▇▇▇▇ or ▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇ which latter shall not have any
rights to contest, defend, delay or otherwise interfere or object to any
claims or indemnification process herein and the Vendors hereby waive,
renounce and exonerate Ramtron and Purchaser from the obligation of
making any such claim directly against ▇▇▇ ▇▇▇▇▇▇▇▇▇ or ▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇
thereto.
(c) Notwithstanding anything to the contrary, the aggregate amount of
indemnification obligations of Designated Vendors pursuant to this
Agreement shall not exceed (i) the value of the Escrow Shares at the time
of the claim during the first year following the Closing and Purchaser's
and Ramtron's sole and exclusive remedy with respect to such
indemnification obligation shall be against such Escrow Shares and not
against any other asset of the Vendors and (ii) for the period after the
first year, Five Hundred Thousand US Dollars (U.S.$500,000) (it being
understood that the only claims that may be made after one year are
claims made pursuant to Sections 8.3(a) and 8.3(b)(i) and 8.3(b)(ii))
less any amount paid during the first year. In addition, the
indemnification obligations of the Designated Vendors based on fraud or
fraudulent misrepresentation made by the Corporation pursuant to Sections
3.2 and 3.3 shall be limited to the aggregate value of the Purchase
Price. However, the indemnification obligations with respect to fraud or
fraudulent misrepresentations made by a Designated Vendor with respect to
Vendors' Core Representations shall not be subject to any limitation as
to the amount.
(d) Notwithstanding anything to the contrary, the aggregate amount of
indemnification obligations of Ramtron and Purchaser pursuant to this
Agreement shall be limited to the aggregate value of the Purchase Price
and the aggregate amount of indemnification obligations of Ramtron and
Purchaser pursuant to Sections 4.2(i) and 4.2(j) of this Agreement shall
be limited to the amount of Five Hundred Thousand US Dollars
(US$500,000), save and except if such indemnification obligations results
from fraud or fraudulent misrepresentations in which case the aggregate
limitation shall remain the aggregate value of the Purchase Price.
Page-55
8.5 Obligation to Reimburse
The amount of any Damages suffered or incurred by a Party being indemnified
hereunder (the "Indemnified Party") shall accrue interest at a rate per annum
equal to the Prime Rate plus 3%, compounded annually, from the date that the
Indemnified Party first incurred any such Damages until payment in full by the
Party providing for indemnification hereunder (the "Indemnifying Party").
8.6 Notification
Promptly upon obtaining knowledge thereof, the Indemnified Party shall notify
the Indemnifying Party of any cause which the Indemnified Party has determined
has given or could give rise to indemnification under this Article 8 (a
"Notice"). The omission so to notify the Indemnifying Party shall not relieve
the Indemnifying Party from any duty to indemnify and hold harmless which
otherwise might exist with respect to such cause unless the notification
occurs after the expiration of the applicable time limit as set out in
Section 8.3 or unless the omission to notify materially prejudices the
ability of the Indemnifying Party to exercise its right to defend provided in
this Article 8.
8.7 Defence of Third Party Claim
(a) If any legal proceeding shall be instituted or any claim or demand shall
be asserted by a third party against the Indemnified Party (which, in the
case of Purchaser, shall include the Corporation) (each a "Third Party
Claim"), then the Indemnifying Party shall have the right, after receipt
of the Indemnified Party's Notice under Section 8.6 and upon giving
notice to the Indemnified Party within not more than 15 days of such
receipt, to defend the Third Party Claim at its own cost and expense with
counsel of its own selection, provided that:
(i) the Indemnified Party shall at all times have the right to fully
participate in the defence at its own cost and expense (provided,
however, that defence costs and expenses of the Indemnified Party
prior to the date the Indemnifying Party validly exercises its right
to defend the Third Party Claim shall be reimbursed by the
Indemnifying Party to the Indemnified Party);
(ii) the Third Party Claim seeks only monetary damages and does not seek
any injunctive or other relief against the Indemnified Party;
(iii) the Indemnifying Party unconditionally acknowledges in writing its
obligations to indemnify and hold the Indemnified Party harmless
with respect to the Third Party Claim; and
(iv) legal counsel chosen by the Indemnifying Party is satisfactory to
the Indemnified Party, acting reasonably.
Page-56
(v) if the amount of the Third Party Claim is greater than the value of
the Escrowed Shares then being held under the Escrow Agreement
inclusive of reasonably estimated interest and costs, and such Third
Party Claim is not subject to the limitations provided in Section
8.4, then the Indemnifying Party shall deliver a letter of credit,
surety bond or similar security in form and substance satisfactory
to the Indemnified Party, acting reasonably, in the amount by which
such Third Party Claim exceeds the outstanding balance of the value
of the Escrowed Shares then being held under the Escrow Agreement as
security for the payment of amounts payable by the Indemnifying
Party to the Indemnified Party pursuant hereto.
Amounts payable by the Indemnifying Party pursuant to a Third Party Claim
shall be paid in accordance with the terms of the settlement or final
non-appealable judgment.
(b) The Indemnifying Party shall not be permitted to compromise and settle or
to cause a compromise and settlement of any Third Party Claim without the
prior written consent of the Indemnified Party, unless:
(i) the terms of the compromise and settlement require only the payment
of money and do not require the Indemnified Party to admit any
wrongdoing, take or refrain from taking any action, acknowledge any
rights of the third Person making the Third Party Claim or waive any
rights that the Indemnified Party may have against such third Person
making the Third Party Claim; and
(ii) the Indemnified Party receives, as part of the compromise and
settlement, a legally binding and enforceable unconditional
satisfaction or release, which is in form and substance satisfactory
to the Indemnified Party, acting reasonably, from any and all
obligations or liabilities it may have with respect to the Third
Party Claim.
(c) Notwithstanding Section 8.7(b), the Indemnifying Party shall not be
permitted to compromise and settle or to cause a compromise and
settlement of any Third Party Claim relating to Taxes without the prior
written consent of the Indemnified Party if such compromise and
settlement may have an impact upon Taxes for any period ending after the
Closing Date.
(d) If the Indemnifying Party fails to give notice of its intention to
participate in the Third Party Claim in accordance with Section 8.7(a),
then the Indemnifying Party shall be deemed to have waived its right to
participate in the Third Party Claim and the Indemnified Party shall have
the right (but not the obligation) to undertake the defence of the Third
Party Claim and compromise and settle the Third Party Claim on behalf,
for the account and at the risk and expense of the Indemnifying Party.
Page-57
(e) If the Indemnifying Party participates in the defence of a Third Party
Claim, then the Indemnified Party will use its reasonable efforts to make
available to the Indemnifying Party those employees whose assistance,
testimony or presence is necessary to assist the Indemnifying Party in
evaluating and participating in the defence of any such claims.
(f) The Indemnified Party shall, at the request of the Indemnifying Party,
make available to the Indemnifying Party or its representatives on a
timely basis all documents, records and other materials in the possession
of the Indemnified Party, at the expense of the Indemnifying Party,
reasonably required by the Indemnifying Party for its use in defending
any Third Party Claim, the defence of which it has elected to participate
in, and the Indemnified Party shall otherwise cooperate on a timely basis
with the Indemnifying Party in the defence of such claim.
(g) The Indemnifying Party's right to defend any Third Party Claim in respect
of any Tax or other liability enforceable by Lien against the property of
or any amount receivable by the Indemnified Party shall only apply after
payment by the Indemnifying Party to the applicable Governmental Entity
or other Person of the amount due in respect thereof.
(h) Notwithstanding anything to the contrary, the obligations of the Vendors,
Ramtron and Purchaser, as the case may be, under this Section 8.7 are
subject to the time limitations and limitation on damages set forth in
Sections 8.3 and 8.4.
8.8 Undertakings of Designated Vendors
(a) The Designated Vendors declare and acknowledge that the indemnification
provided in Section 8.1(b) in favour of Purchaser constitutes a principal
and separate obligation of the Designated Vendors in favour of the
Purchaser and waive any and all recourses they may have against the
Corporation in the event (i) of any failure of the Corporation to perform
or fulfill any of its covenants under this Agreement at any time and (ii)
any breach or inaccuracy of any representation or warranty given by the
Corporation pursuant to Sections 3.2 and 3.3 hereof.
(b) In the event of the merger or amalgamation of the Purchaser and the
Corporation subsequent to Closing, the Vendors and the Designated Vendors
confirm that the obligation provided in Section 8.1 shall survive such
merger or amalgamation. In this connection, Purchaser may assign to
Ramtron, without consent, prior to any such merger or amalgamation, the
obligation of indemnification of the Vendors and Designated Vendors
pursuant to Section 8.1 hereof.
ARTICLE 9
MISCELLANEOUS
-------------
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9.1 Further Assurances
Each Party shall, at the request of any other Party, execute and deliver such
additional conveyances, transfers and other assurances and do all such other
acts or things as may be reasonably required to effectively transfer the
Purchased Shares to Purchaser and carry out the purposes and intent of this
Agreement.
9.2 Public Disclosure
No Vendor nor their respective representatives will make any public disclosure
at any time concerning the matters set forth in this Agreement or the
transactions contemplated hereby without the prior written consent of
Purchaser, except if required for legal, securities laws or other regulatory
reasons.
9.3 Notices
All notices and other communications pursuant to this Agreement shall be in
writing and shall be deemed given if delivered personally, telecopied, sent by
a United States or Canadian nationally-recognized overnight courier or mailed
by registered or certified mail (return receipt requested), postage prepaid,
to the Parties at the addresses set forth below or to such other address as
the Party to whom notice is to be given may have furnished to the other
Parties in writing in accordance with this Section 9.3. Any such notice or
communication shall be deemed to have been delivered and received (a) in the
case of personal delivery, on the date of such delivery, (b) in the case of
telecopier, on the date sent if confirmation of receipt is received, (c) in
the case of such a national-recognized overnight courier in circumstances
under which such courier guarantees next Business Day delivery, on the next
Business Day after the date when sent and (d) in the case of mailing, on the
third Business Day following that on which the envelope containing such
communication is posted:
(i) If to Purchaser, Ramtron, or the Corporation after Closing, at:
▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇ ▇▇▇▇▇▇, Chief Financial Officer
and
▇▇▇▇ ▇▇▇▇▇, President, Technology Group
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
with a copy to Coudert Brothers LLP at:
▇▇▇ ▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇ St. Clair
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
Page-59
and a copy to ▇▇▇▇▇▇ ▇▇▇▇▇▇ Gervais LLP at:
▇▇▇▇ ▇▇ ▇▇ ▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇ ▇▇▇
▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇ ▇▇▇ ▇▇▇
Attention: ▇▇▇ ▇▇▇▇▇▇▇
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
(ii) If to the Vendors, or to the Corporation on or prior to Closing, at:
Goal Semiconductor Inc.
1134 Ste ▇▇▇▇▇▇▇▇▇ Street West
Suite 900
Montreal, Quebec H3B 1H4
Attention: ▇▇▇ ▇▇▇▇▇▇▇▇▇
Facsimile: (▇▇▇)▇▇▇-▇▇▇▇
with copies to
Business Development Bank of Canada
▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇, ▇▇▇▇▇▇▇, ▇▇▇ ▇▇▇
Attention: ▇▇▇ April
Facsimile: (▇▇▇)▇▇▇-▇▇▇▇
and
Fonds de solidarite des travailleurs du Quebec (F.T.Q.)
▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇ ▇▇▇
▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇, ▇▇▇ ▇▇▇
Attention: Legal Department
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
and
Investissement Technologie (3599) Inc.
▇▇▇, ▇▇ ▇▇ ▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇, ▇▇▇ ▇▇▇
Attention: Corporate secretary
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
Page-60
and
Vision2000 Venture Ltd.
▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇,
▇.▇. ▇▇▇ ▇▇▇ GT
GeorgeTown, Grand Cayman, Cayman Islands
Attention: ▇▇▇▇ ▇▇▇▇
Facsimile: c/o Conyers ▇▇▇▇ ▇▇▇▇▇▇▇, attorneys ▇▇▇-(▇▇▇) ▇▇▇▇ ▇▇▇▇
and
BCF LLP
▇▇▇▇ ▇▇▇▇-▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇, ▇▇▇ ▇▇▇
Attention: ▇▇▇▇-▇▇▇▇▇▇ ▇▇▇▇▇
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
The failure to send or deliver a copy of a notice to legal counsel of
Purchaser or Vendors as set forth above shall not invalidate any notice given
under this Section 9.3.
9.4 Time of the Essence
Time shall be of the essence of this Agreement. The mere lapse of time in the
performance of the terms of this Agreement by any Party shall have the effect
of putting such Party in default in accordance with Articles 1594 to 1600 of
the Civil Code of Quebec.
9.5 Confidentiality
Except as required by Law, Vendors will maintain all information relating to
the Corporation strictly in confidence and will not disclose to any Person or
make public or authorize the disclosure of any such information and will not
use such information for any purpose unless: (a) the specific information is
now or hereafter publicly disclosed other than as a result of breach of this
provision; (b) the specific information was already in the possession of the
receiving Party prior to the receipt by it of such information from the other
Party; (c) the specific information is disclosed to the receiving Party by a
third Person having no obligation of confidentiality to the disclosing party
with regard to the information or (d) the specific information is
independently generated by the receiving Party without the use and not as a
consequence of the disclosure by the other Party. The confidentiality
agreement dated May 12, 2005 between Purchaser and the Corporation is hereby
terminated.
Page-61
In addition, except as required by law or by the rules of NASDAQ National
Market, including without limitation applicable securities laws, each party
shall not disclose (and shall cause its officers, directors, employees,
affiliates and professional advisors not to disclose) any matter or matters
relating to the transactions contemplated by this Agreement to any person not
an officer, director, employee, affiliate or professional advisor of such
party.
9.3 Third Party Beneficiaries
The Parties intend that this Agreement shall not benefit or create any right,
stipulation for the benefit of, delegation open for acceptance by, or cause of
action in favour of, any Person other than the Parties and no person, other
than the Parties, shall be entitled to rely on the provisions of this
Agreement in any action, suit, proceeding, hearing or other forum.
9.7 Expenses
Purchaser shall pay for its own fees and expenses and Vendors shall pay for
their own fees and expenses which are, in each case, incident to the
negotiation, preparation and execution of this Agreement, the transactions and
the agreements contemplated hereby, including legal and accounting fees and
expenses.
9.8 Amendments
This Agreement may only be amended, supplemented or otherwise modified by
written agreement signed by all Parties.
9.8 Waiver
No waiver of any of the provisions of this Agreement shall be deemed to
constitute a waiver of any other provision (whether or not similar) or a
future waiver of the same provisions, nor shall such waiver be binding unless
executed in writing by the Party to be bound by the waiver.
No failure on the part of Vendors or Purchaser to exercise, and no delay in
exercising any right under this Agreement shall operate as a waiver of such
right; nor shall any single or partial exercise of any such right preclude any
other or further exercise of such right or the exercise of any other right.
9.10 Non-Merger
Except as otherwise expressly provided in this Agreement, the covenants,
representations and warranties shall not merge on and shall survive Closing
and, notwithstanding such Closing and any investigation made by or on behalf
of any Party, shall continue in full force and effect.
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9.11 Entire Agreement
This Agreement, constitutes the entire agreement between the Parties with
respect to the transactions contemplated in this Agreement and supersedes all
prior agreements, understandings, negotiations and discussions, whether oral
or written, of the Parties including the Letter of Intent dated June 29, 2005,
as amended, executed by the Corporation and Ramtron. There are no
representations, warranties, covenants, conditions or other agreements,
express or implied, collateral, statutory or otherwise, among the Parties in
connection with the subject matter of this Agreement except as specifically
set forth herein and no Party has relied or is relying on any other
information, discussion or understanding in entering into and completing the
transactions contemplated in this Agreement.
9.12 Successors and Assigns
This Agreement shall be binding upon and enure to the benefit of the Parties
and their respective successors and permitted assigns. Neither this Agreement
nor any of the rights or obligations under this Agreement shall be assignable
or transferable by Vendors without the prior written consent of Purchaser.
Purchaser may assign and transfer this Agreement and any of its rights and
obligations under this Agreement to an Affiliate without the prior written
consent of Vendors, provided that Purchaser shall not by reason of any such
assignment and transfer be released from its obligations hereunder. Purchaser
may assign its rights under this Agreement, in whole or in part, to any
subsequent purchaser of Purchaser or any material portion of its assets,
whether such sale is structured as a sale of shares, a sale of assets, a
merger or otherwise.
9.13 Severability
If any provision of this Agreement shall be determined by an arbitrator or any
court of competent jurisdiction to be illegal, invalid or unenforceable, that
provision shall be severed from this Agreement and the remaining provisions
shall continue in full force and effect.
9.14 Governing Law
This Agreement shall be governed by and interpreted and enforced in accordance
with the Laws of the Province of Quebec and the federal Laws of Canada
applicable therein. The Parties hereby attorn to the jurisdiction of the
courts of the Province of Quebec.
9.15 Language
Les parties ont exige que la presente convention et les documents qui s'y
rattachent soient rediges en anglais seulement. The parties have requested
that this Agreement and any documents related thereto be drafted in the
English language only.
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9.16 Counterparts
This Agreement may be executed in any number of counterparts (including
counterparts by facsimile) and all such counterparts taken together shall be
deemed to constitute one and the same instrument.
IN WITNESS WHEREOF the Parties have executed this Share Purchase Agreement as
of the date first written above.
4317467 CANADA INC.
/s/ ▇▇▇▇ ▇▇▇▇▇
----------------------
By: ▇▇▇▇ ▇▇▇▇▇
Name: ▇▇▇▇ ▇▇▇▇▇
Title: Secretary Treasurer
RAMTRON INTERNATIONAL CORPORATION
/s/ ▇▇▇▇ ▇▇▇▇▇
----------------------
By: ▇▇▇▇ ▇▇▇▇▇
Name: ▇▇▇▇ ▇▇▇▇▇
Title: President
FONDS DE SOLIDARITE DES TRAVAILLEURS DU QUEBEC (F.T.Q.)
/s/ ▇▇▇▇▇▇ ▇▇▇▇▇▇▇
----------------------
By: ▇▇▇▇▇▇ ▇▇▇▇▇▇▇
Name: ▇▇▇▇▇▇ ▇▇▇▇▇▇▇
Title: Senior Vice President
BUSINESS DEVELOPMENT BANK OF CANADA
/s/ ▇▇▇ April
----------------------
By: ▇▇▇ April
Name: ▇▇▇ April
Title: Director, Venture Capital
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INVESTISSEMENT TECHNOLOGIE (3599) INC.
/s/ Michel Sainte-▇▇▇▇▇
-------------------------
By: Michel Sainte-▇▇▇▇▇
Name: Michel Sainte-▇▇▇▇▇
Title: Director
/s/ ▇▇▇▇ ▇▇▇▇▇▇▇▇▇
-------------------------
By: ▇▇▇▇ ▇▇▇▇▇▇▇▇▇
Name: ▇▇▇▇ ▇▇▇▇▇▇▇▇▇
Title: Director and Vice President
VISION2000 VENTURE LTD.
/s/ ▇▇▇▇ ▇▇▇▇
----------------------
By: ▇▇▇▇ ▇▇▇▇
Name: ▇▇▇▇ ▇▇▇▇
Title: Director
GOAL SEMICONDUCTOR INC.
/s/ ▇▇▇ ▇▇▇▇▇▇▇▇▇
----------------------
By: ▇▇▇ ▇▇▇▇▇▇▇▇▇
Name: ▇▇▇ ▇▇▇▇▇▇▇▇▇
Title: President
/s/ ▇▇▇ ▇▇▇▇▇▇▇▇▇
----------------------
▇▇▇ ▇▇▇▇▇▇▇▇▇, as escrow agent,
on behalf of ▇▇▇▇▇▇▇ Parziole
/s/ ▇▇▇ ▇▇▇▇▇▇▇▇▇
----------------------
▇▇▇ ▇▇▇▇▇▇▇▇▇, as escrow agent,
on behalf of ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇
/s/ ▇▇▇ ▇▇▇▇▇▇▇▇▇
----------------------
▇▇▇ ▇▇▇▇▇▇▇▇▇, as escrow agent,
on behalf of ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
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/s/ ▇▇▇ ▇▇▇▇▇▇▇▇▇
----------------------
▇▇▇ ▇▇▇▇▇▇▇▇▇, as escrow agent,
on behalf of ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇
/s/ ▇▇▇ ▇▇▇▇▇▇▇▇▇
----------------------
▇▇▇ ▇▇▇▇▇▇▇▇▇, as escrow agent,
on behalf of Abdellah Azelmad
/s/ ▇▇▇ ▇▇▇▇▇▇▇▇▇
----------------------
▇▇▇ ▇▇▇▇▇▇▇▇▇, as escrow agent,
on behalf of ▇▇▇▇▇▇ ▇▇▇▇▇▇▇
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