________________________________________________
Purchase Agreement
among
Uniphase Corporation,
International Business Machines Corporation,
and
Uniphase Laser Enterprise AG
__________________________________________________
TABLE OF CONTENTS
ARTICLE I. PURCHASE AND SALE OF ASSETS. 1
Section 1.1. Transferred Assets. 2
Section 1.2. Excluded Assets. 2
Section 1.3. Consideration. 2
Section 1.4. Assumed Liabilities. 2
Section 1.5. Accounts Receivable. 3
ARTICLE II. CLOSING. 3
Section 2.1. Closing Date. 3
Section 2.2. Delivery by Buyer. 3
Section 2.3. Delivery by Seller. 4
ARTICLE III. TAX MATTERS. 5
Section 3.1. Allocation of Purchase Price. 5
Section 3.2. Filing of Returns and Payment of 5
Taxes.
Section 3.3. Refunds and Credits. 6
Section 3.4. Transfer Taxes. 6
Section 3.5. Tax Definitions. 6
ARTICLE IV. OTHER MATTERS. 6
Section 4.1. Consents and Subcontracted Work. 6
Section 4.2. Employees and Employee Benefits. 7
Section 4.3. Leased Property. 9
Section 4.4. Further Action. 9
Section 4.5. Transitional Services Agreement 9
Section 4.6. Liens. 9
Section 4.7. Relocation. 10
Section 4.8. Due Diligence. 10
Section 4.9. Buyer Financial Statements. 10
ARTICLE V. REPRESENTATIONS AND WARRANTIES OF BUYER. 10
Section 5.1. Incorporation. 10
Section 5.2. Authority. 10
Section 5.3. No Conflict. 11
Section 5.4. Governmental Consents - Buyer. 11
Section 5.5. No Broker. 12
ARTICLE VI. REPRESENTATIONS AND WARRANTIES OF 12
SELLER.
Section 6.1. Incorporation. 12
Section 6.2. Authority. 12
Section 6.3. No Conflict. 12
Section 6.4. Governmental Consents - Seller. 13
Section 6.5. No Broker. 13
Section 6.6. Title to Personal Property. 13
Section 6.7. Actions, Suits, Proceedings. 13
Section 6.8. No Rights In Others To Transferred 13
Assets.
Section 6.9. Contracts. 14
Section 6.10. Licenses and Permits. 14
Section 6.11. Employee Union. 14
Section 6.12. Warranties Exclusive. 14
Section 6.13. Book Value. 14
ARTICLE VII. GENERAL. 14
Section 7.1. Survival of Representations and 15
Warranties.
Section 7.2. Limitation of Liability. 14
Section 7.3. Public Announcements. 15
Section 7.4. Costs. 15
Section 7.5. Bulk Sales. 15
Section 7.6. Modification and Waiver. 15
Section 7.7. Governing Law. 16
Section 7.8. Notices. 16
Section 7.9. Assignment. 17
Section 7.10. Counterparts. 17
Section 7.11. Guarantee. 17
Section 7.12. Entire Agreement 17
SCHEDULES
Schedule 1.1. Asset Listing
Schedule 1.1. Production Equipment
Schedule 1.1.B. Office Furniture/Equipment
Schedule 1.1.C. Inventory and Work in Process
Schedule 1.1.D. Accounts Receivable
Schedule 1.4.A.1. Assumed Liabilities
Schedule 1.4.B. Internal Contracts with Seller or
Seller
Schedule 3.1. Allocation of Purchase Price
Schedule 4.1. Consents to Assignments
Schedule 4.2.A. Employees
Schedule 4.2.C. Seller
Schedule 5.4. Governmental Consents - Buyer
Schedule 6.4. Governmental Consents - Seller
Schedule 6.7. Actions, Suits, Proceedings
Schedule 6.10. Licenses and Permits
EXHIBITS
Exhibit A: Assumption Agreement
Exhibit B: ▇▇▇▇ of Sale
Exhibit C: Transitional Services Agreement
Exhibit D: Seller Lease
Exhibit E: Pension Matters
PURCHASE AGREEMENT
THIS AGREEMENT, dated as of March 10, 1997, by and between
International Business Machines Corporation, a New York corporation
("Seller"), Uniphase Corporation, a Delaware corporation, and Uniphase
Laser Enterprise AG, a Swiss AG ("Buyer") (herein "Agreement");
W I T N E S S E T H:
WHEREAS, Seller wishes to sell assets used in the manufacturing
of certain components (such assets being hereinafter referred to as the
"Transferred Assets") which business operations are currently conducted at
Seller's facility located at Reuschlikon, Canton Zurich, Switzerland; and
WHEREAS, Buyer wishes to purchase from Seller, and Seller wishes
to sell to Buyer, the Transferred Assets for the purchase price and subject
to the terms and conditions hereinafter set forth;
NOW, THEREFORE, in consideration of the premises set forth above
and the respective covenants, agreements, representations and warranties
hereinafter set forth, Buyer, Seller, and Uniphase Corporation
(collectively, the "Parties") hereby agree as follows:
Article I. Purchase and Sale of Assets.
Section 1.1. Transferred Assets. Upon the terms and
subject to the conditions hereof, as of the Closing Date (as defined in
Article 2.1 hereof), Seller hereby sells, transfers, conveys, assigns and
delivers to Buyer, and Buyer hereby purchases and accepts from Seller, all
right, title and interest of Seller in and to the items of equipment and
office furniture, and assets, including work in progress and accounts
receivable, listed on the sub-schedules of Schedule 1.1 hereto and spare
parts, as available for any of the items listed thereon, but excluding cash
accounts. Intellectual property matters are addressed exclusively in the
Patent License Agreement and Technology License Agreement between the
Parties, dated as of the date of this Agreement (herein the "Intellectual
Property Agreements") and except as provided in Section 7.2. are not
otherwise a subject matter of this Agreement.
All such scheduled assets and Assumed Liabilities (as defined
below) of Seller are collectively referred to herein as the "Transferred
Assets." Wherever used in this Agreement, the term "affiliate" of any
person or entity shall mean any person or entity which is controlling,
controlled by or under common control with such person or entity.
Seller shall also assign applicable third party warranties on the
Transferred Assets, to the extent legally permissible, and without
responsibility for compliance by the warranty grantors.
Section 1.2. Excluded Assets. Notwithstanding anything
to the contrary in this Agreement or any agreements contemplated by this
Agreement, the following assets (collectively, the "Excluded Assets") will
be retained by Seller, and are excluded from the Transferred Assets:
(a) any interest in or right to use any trademark or service
▇▇▇▇ owned by Seller or any of its affiliates, any associated logo or any
derivative of any thereof, either alone or in conjunction with other words;
(b) except as set forth in Schedule 1.4.B., any interest in any
contractual arrangement with Seller or any of its affiliates;
(c) all other assets of Seller or any of its affiliates not
expressly listed on Schedule 1.1 hereto; and
(d) except as provided in the Seller Lease (as defined in
Section 2.2(c) below), any interests of Seller or any of its affiliates in
real property.
Section 1.3. Consideration. The Purchase Price for the
Transferred Assets and the licenses granted under the Intellectual Property
Agreements shall be $45,000,000 (forty-five million dollars). Buyer shall
pay to Seller by electronic funds transfer, such sum in immediately
available funds at the Closing, in U.S. dollars.
Section 1.4. Assumed Liabilities.
(a) At the Closing, Seller will assign and transfer to Buyer,
and Buyer will assume, and thereafter shall fully perform and discharge, on
a timely basis and in accordance with their respective terms, the
liabilities and obligations of Seller listed on Schedule 1.4.A.1. and
Schedule 1.4.A.2., hereto (the "Assumed Liabilities"). Without limiting
the generality of the foregoing, except for the Assumed Liabilities and the
Buyer's obligations to the Employees under Swiss law, Buyer is not assuming
or undertaking any obligations or liabilities of Seller, to any assets or
contracts which are not included in the Transferred Assets or the Assumed
Liabilities. Buyer is assuming and undertaking, and Seller shall not
remain liable for, any obligations or liabilities of Seller, contingent or
otherwise, whenever asserted, relating to periods prior to the Closing
Date, and work performed during such periods with respect to the Assumed
Liabilities, as set forth on Schedule 1.4.A.2., and such obligations and
liabilities are specifically included in the Assumed Liabilities. The
Assumed Liabilities shall, except as otherwise set forth herein, exclude
liabilities and obligations of Seller with respect to periods prior to the
Closing Date, including, without limitation, any liabilities or payments
accruing with respect to the Assumed Liabilities for periods prior to the
Closing Date. Any rights, liabilities and obligations of Seller to or from
any of its affiliates will not be transferred to Buyer, other than as set
forth in Schedule 1.4.B.
(b) The Parties will each use reasonable efforts to obtain
written consents to the transfer and assignment to Buyer of the Transferred
Assets and Assumed Liabilities, where the approval or other consent of any
other person may be required. The Parties shall cooperate (including,
where necessary, entering into appropriate instruments of assumption as
shall be agreed upon) to have Seller released from all liability to third
parties with respect to the Assumed Liabilities, and the Parties will each
solicit such releases concurrently with the solicitation of consents from
third parties to the transfer and assignment to Buyer of the Transferred
Assets and the Assumed Liabilities; provided, that, neither Party shall be
required to grant any additional consideration to any third party in order
to obtain any such consent or release.
Section 1.5. Accounts Receivable. The accounts receivable
listed on Schedule 1.5 are part of the Transferred Assets. Such accounts
receivable are transferred subject to collection, with no representations
as to collectibility, or as to any minimum amount to be provided. If such
accounts receivable exceed $5.5 million U.S., Buyer will repay such excess
to Seller within 15 business days of collection and in no event later than
90 days after the date of this Agreement. If Buyer has notified Seller
within such 90-day period that Buyer has determined a portion of such
accounts receivable to be uncollectible, and if some accounts receivable
are deemed to be uncollectible as determined in good faith by both Parties,
the Seller shall receive from the Buyer no later than six months after the
Closing a final balancing payment for such uncollectible receivables; the
remaining accounts receivable transferred above $5.5 million U.S., reduced
by an amount calculated under the following formula: the product of (i)
such uncollectible amounts, divided by the total accounts receivable
transferred at Closing; times (ii) the result of the total accounts
receivable transferred at Closing, less $5.5 million U.S. An exchange rate
of 1.48 Swiss Francs for each U.S. dollar will be applied for those
receivables denominated in Swiss Francs.
Article II. Closing.
Section 2.1. Closing Date. The closing of the
transactions provided for in this Agreement (the "Closing") shall take
place on the date hereof (the "Closing Date") at the offices of Seller.
All transactions provided for herein to occur on and as of the Closing Date
shall be deemed to have occurred simultaneously and to be effective as of
the close of business on the Closing Date.
Section 2.2. Delivery by Buyer. At the Closing, Buyer
will deliver or cause to be delivered to Seller the following:
(a) payment of the Purchase Price in the manner specified in
Article 1.3 hereof;
(b) an Assignment and Assumption Agreement substantially in the
form of Exhibit A hereto (the "Assumption Agreement"), duly executed by
Buyer and assigning the Assumed Liabilities to Buyer;
(c) Laboratory Real Estate Lease in the form of Exhibit D hereto
(the "Seller Lease"), duly executed by Buyer.
(d) Transitional Services Agreement in the form of Exhibit C
hereto, duly executed by Buyer;
(e) an extract from the Swiss Commercial Register of Buyer
certified by the Commercial Register, and a copy of the Certificate of
Incorporation of Uniphase Corporation certified by the Secretary of State
of the State of Delaware; and
(f) a certificate of the Secretary of Uniphase Corporation as to
the By-laws of Uniphase Corporation and the resolutions of Uniphase
Corporation, and a power of attorney of the only member of the board of
directors of Buyer, authorizing the execution, delivery and performance of
this Agreement, the Intellectual Property Agreements, the Seller Lease, the
Assumption Agreement, the Transitional Services Agreement, and the future
Swiss Pension Transfer Agreement by either Buyer or Uniphase Corporation,
as applicable, and the persons acting on behalf of Buyer, executing such
Agreements and any document delivered in connection with such agreements at
the Closing.
Section 2.3. Delivery by Seller. At the Closing, Seller
will deliver or cause to be delivered to Buyer the following:
(a) a ▇▇▇▇ of sale substantially in the form of Exhibit B hereto
(the "▇▇▇▇ of Sale"), duly executed by Seller, effectively vesting in Buyer
all right, title and interest of Seller in and to the tangible personal
property included in the Transferred Assets as provided in this Agreement;
(b) the Assumption Agreement, duly executed by Seller;
(c) the Seller Lease, duly executed by Seller;
(d) the Transitional Services Agreement, duly executed by
Seller;
(e) a certificate of the Secretary of Seller as to the By-laws
of Seller, and the delegations authorizing the execution, delivery and
performance of this Agreement, the Intellectual Property Agreements, the
▇▇▇▇ of Sale, the Seller Lease, the Assumption Agreement, the Transitional
Services Agreement and the future Swiss Pension Transfer Agreement, and as
to the incumbency of all officers of Seller executing this Agreement and
any document delivered in connection with this Agreement at the Closing.
Article III. Tax Matters.
Section 3.1. Allocation of Purchase Price. Buyer and
Seller agree on an estimated allocation of the Purchase Price as set forth
in Schedule 3.1. to the extent necessary to permit the making of timely
transfer tax filings. In addition, as soon as practicable after the
Closing Date, but in no event not later than 90 days prior to the due date
of the Internal Revenue Service Form 8594, Buyer shall provide to Seller
proposed statements ("Allocation Statements") allocating the total of the
Purchase Price (and other payments properly treated as additional Purchase
Price for Tax purposes) to the different Transferred Assets as set forth in
Schedule 3.1., pursuant to Section 1060 of the Internal Revenue Code of
1986, as amended, and the Treasury Regulations promulgated thereunder
(hereinafter, the "Code"). Seller will agree to Buyer's proposed
Allocation Statements.
Buyer and Seller shall each file all income, franchise and other
Tax Returns (as defined below), and execute such other documents as may be
required by any governmental authority, in a manner consistent with the
Allocation Statements. Buyer shall prepare the Form 8594 under Section
1060 of the Code based on the Allocation Statements and deliver such form
and all documentation used in the preparation and support of such
Allocation Statements and form (including, but not limited to, appraisals)
to the Seller within 30 days after finalization of the Allocation
Statements. The Buyer and the Seller agree to file such form with each
relevant taxing authority and to refrain from taking any position
inconsistent with such form or Allocation Statements.
Notwithstanding the above provision, Buyer agrees to indemnify
and hold Seller harmless from and against any and all liability for Taxes
resulting from any reallocation of the Purchase Price that differs from the
estimated allocation as set forth in Schedule 3.1. For purposes of
calculating the amount of any Taxes in the preceding sentence, it shall be
assumed that such Taxes are payable at the highest effective statutory
corporate income tax rates that could apply to Seller, as applicable, for
the relevant period.
Section 3.2. Filing of Returns and Payment of Taxes.
Seller shall prepare and file, or cause to be prepared and filed, with the
appropriate authorities all Tax (as defined below) returns, reports and
forms (herein "Tax Returns") and shall pay, or cause to be paid, when due
all Taxes relating to the Transferred Assets attributable to any taxable
period which ends on or prior to the Closing Date (herein "Pre-Closing Tax
Period"). Buyer shall prepare and file, or cause to be prepared and filed,
with the appropriate authorities all Tax Returns, and shall pay, or cause
to be paid, when due all Taxes relating to the Transferred Assets
attributable to the period which is not part of the Pre-Closing Tax Period.
If, in order to properly prepare its Tax Returns or other documents
required to be filed with governmental authorities, it is necessary that a
party be furnished with additional information, documents or records
relating to the Transferred Assets, both Seller and Buyer agree to use
reasonable efforts to furnish or make available such information at the
recipient's request, cost and expense provided, however, that no party
shall be entitled to review or examine the Tax Returns of any other party.
Section 3.3. Refunds and Credits.
Any refunds and credits attributable to the Pre-Closing Tax
Period shall be for the account of the Seller and any refunds and credits
attributable to the period which is not part of the Pre-Closing Tax Period
are for the account of the Buyer.
Section 3.4. Transfer Taxes.
All transfer, documentary, sales, use, registration, value-added
taxes and any similar taxes (including real estate transfer taxes) incurred
in connection with this Agreement and the transactions contemplated hereby
shall be borne by Buyer, in addition to the consideration in Section 1.3.
To the extent legally able to do so, Buyer and Seller shall cooperate with
each other to obtain exemptions from such taxes, including the value added
tax and the preparation of necessary documentation, provided that neither
party shall be obligated to seek any exemption that would require any
governmental audit of its books and records.
Section 3.5. Tax Definitions.
For purposes of this Agreement, "Tax or Taxes" means all taxes,
imposts, duties, withholdings, charges, fees, levies, or other assessments
imposed by any governmental or taxing authority, whether domestic or
foreign, including but not limited to, income, gross receipts, excise,
property, sales, use, transfer, conveyance, payroll or other employment
related, license, ad valorem, value added, withholding, social security,
national insurance (or other similar contributions or payments), franchise,
estimated severance, stamp taxes, taxes based upon capital stock or net
worth and other taxes (including interest, fines, penalties, or additions
attributable to or imposed on or with respect to, any such taxes, charges,
fees levies or other assessments).
Article IV. Other Matters.
Section 4.1. Consents and Subcontracted Work. Seller and
Buyer shall use reasonable efforts to obtain, in a reasonable amount of
time and no later than four months after the Closing Date unless
impractical, all requisite consents to assignments and novations, as the
case may be, of all of the Transferred Assets and the Assumed Liabilities.
The Parties will cooperate and use reasonable efforts in obtaining such
consents and novations in accordance with the provisions of this Agreement.
The material consents to assignment that have been identified at this time
are listed on Schedule 4.1. If any such required consents cannot be
secured without the incurring of any significant additional costs, the
Parties shall enter into such other arrangements with respect to the
underlying rights and obligations as shall permit Buyer to perform the
obligations of Seller thereunder, as a subcontractor or otherwise, and
Buyer to obtain the sole benefit thereof (the "Subcontracted Work"); and
until the requisite consents are obtained, such obligations shall not be
deemed to be included in the Assumed Liabilities and nothing contained
herein shall be deemed to constitute a breach of the contract underlying
such rights and obligations. Buyer agrees to diligently perform and
discharge the obligations of Seller in connection with the Subcontracted
Work; and if and to the extent that consents to assignment are obtained
after the Closing Date, Buyer agrees that such obligations shall no longer
be considered to be Subcontracted Work, but shall instead be deemed to be
Assumed Liabilities for all purposes of this Agreement.
The Seller hereby transfers to the extent it has the legal right
to do so and subject to the applicable license agreements with the
licensors, its royalty-free usage rights to the shrink-wrap personal
computer software (also known as conditions of use software) being used in
the normal course of the Seller's Zurich laser chip production by the
Employees, if such software is installed as of March 7, 1997 on the
computers which are among the Transferred Assets. If such software
copyrights are owned by the Seller, Seller's license terms and conditions
continue to apply.
Section 4.2. Employees and Employee Benefits.
(a) Schedule 4.2.A. contains a list of some of the individuals
employed by the Seller at the date hereof (including active employees and
employees who are on leave of absence; sick leave or disability leave)
(herein the "Employees").
(b) The employment relations of the Employees are assumed by the
Buyer, together with all rights and obligations, from the date of the
Closing.
(c) The Buyer agrees to use reasonable efforts to provide
comparable benefits. It being understood that the Buyer may not be in a
position to provide all the ancillary benefits currently provided by the
Seller to the Employees. The Buyer has knowledge of the Seller's Swiss
Staff Member Manual. The Seller and the Buyer shall comply with their
respective obligations under Article 333 of the Swiss Code of Obligations.
However, the Seller shall not continue to provide or ensure these benefits
after the Closing Date to the Buyer's Employees. The Buyer assumes all
liabilities for the failure to perform. The Buyer shall provide for the
appropriate amendments in the employment agreements.
(d) The Buyer agrees as promptly as is practicable from the
Closing Date to establish a new defined occupational pension plan (the
"Buyer's Plan") to provide the transferred Employees with pension benefits
that are at least substantially comparable with the benefits that are
provided to such Employees under the Seller's two pension benefit plans
according to Exhibit E. The Buyer's Plan shall provide for the
participation of such Employees therein as of the Closing Date, and provide
that in applying any length of service requirement for participation or
vesting and in determining the benefits, each such Employee shall be
credited with prior service as shown in the records of the Seller,
according to the Seller's rules for service credit, and with the eligible
compensation under the Seller's plan's during the period. The Seller shall
provide the Buyer the documents listed in schedules to Exhibit E to
establish and administer the Buyer's plan with respect to each Employee's
pension benefits, eligible compensation and service prior to the Closing
Date.
(e) For the free movement of capital between the pension funds
and for the partial liquidation of a pension fund the Parties agree to
comply with the Free Movement Statue (Freizugigkeitsgesetz). The assets
shall be calculated according to the Swiss law (BVG and FZG). According to
Article 23 (1) of the FZG, the plan of distribution shall be approved by
the official supervisory body.
(f) These pension provisions are more fully set forth in Pension
Matters, Exhibit E and its schedules and attachments. Upon transfer of the
Transferred Pension Assets (as defined in Exhibit E) to the Buyer's Plan
(as defined in Exhibit E) the Buyer's Plan shall assume all liabilities of
the Seller's Plans for the pension benefits for the Employees and such
transfer shall be in full discharge of all obligations of the Seller's
Plans for the pension benefits.
(g) Buyer shall be responsible for liabilities with respect to
all employment matters concerning the employment of the Employees after the
Closing, including the termination of any Employees by Buyer after the
Closing and damages or settlements arising out of any claims of wrongful or
illegal termination, and for complying with the requirements of all
applicable laws with respect to any such termination.
(h) Buyer agrees to employ the Employees in the Zurich,
Switzerland area, utilizing the Transferred Assets, for at least twenty-
four months following the Closing.
(i) For three years from the date of this Agreement, Seller will
not solicit for employment or employ in any capacity any individual who,
within 12 months prior to the date of new hire, has been an Employee
transferred as part of this Agreement. For three years from the date of
this Agreement, Buyer shall not solicit for employment or employ in any
capacity any individual who, within 12 months prior to the date of new
hire, has been an employee of Seller or its Affiliates working or employed
at Seller's Zurich laboratory, other than Employees.
(j) Buyer shall be responsible for obtaining any necessary work
permits for any Employee required under applicable law, as of and after the
Closing. Seller shall reasonably cooperate with Buyer on such matters.
Seller will provide Buyer with a letter which describes the transfer of the
Employees in the form as has been agreed between the Swiss counsel of the
Seller and Buyer on the Closing Date.
(k) Subject to the Employees' employment agreements or the terms
of any new employment contract between such Employees and Buyer, and
applicable law, the Buyer retains its right to terminate any Employee for
cause. Nothing in this Agreement shall be deemed to convey any rights to
any Employee as a third party beneficiary of any obligation of Buyer to
Seller hereunder.
Section 4.3. Leased Property. The Swiss representatives
of the Buyer and the Seller have negotiated a Seller Lease in the form of
Exhibit D, under Swiss law, for the lease to Buyer from Seller of real
estate following the Closing.
Section 4.4. Further Action. Each of the Parties agrees
to execute and deliver after the Closing Date such other documents,
certificates, agreements and other writings and to take such other actions
as may be necessary, in the opinion of counsel, in order to consummate or
implement expeditiously the transactions contemplated hereby. In addition,
Seller agrees, promptly upon the request of Buyer, and at no additional
expense to Seller, other than the expenses associated with the preparation
of appropriate instruments of assignment, to take all actions reasonably
requested by Buyer to perfect the transfer to Buyer of the Transferred
Assets. The March 1997 payroll for Employees will be paid to the Employees
by Seller under its standard Swiss monthly payroll system. No later than
April 30, 1997, Buyer will pay Seller's invoice for Buyer's proportionate
share of the March payroll, including any applicable social security,
pension plan contributions, and similar sums. Buyer's invoiced payment will
equal a sum calculated by multiplying the total monthly payroll for the
Employees by a fraction, (1) the numerator of which will be the number of
days remaining in March after the Closing Date and (2) the denominator of
which will be 31. (Hypothetically, if the Closing Date is March 10, the
fraction would be 21/31). Seller shall be responsible for all accrued,
unused vacation through March 10,1997, with respect to the Employees and
shall pay to Buyer on or prior to March 30,1997, an amount equal to the
value of Seller's salary due for such accrued unused vacation.
Section 4.5. Transitional Services Agreement. The Swiss
representatives of the Buyer and the Seller have negotiated a Transitional
Services Agreement in the form of Exhibit C, under Swiss law, to handle
services to be provided to the Buyer by the Seller after the Closing.
Section 4.6. Liens. Within thirty days after notice to
Seller of attachment, Seller shall clear all material title liens or
encumbrances upon title attaching to the Transferred Assets after the
Closing Date which arise due to acts or failures to act of Seller prior to
or on the Closing Date. If Seller is unable to clear all material title
liens or encumbrances upon title within thirty (30) days after notice,
Seller shall complete any action necessary to provide Buyer with materially
unencumbered title to the Transferred Assets. In the event that Seller
shall fail to take such action within the time periods specified in this
Section 4.6, to clear such liens and encumbrances under Swiss law, Buyer
shall have the right to take such action as it deems reasonably necessary
to clear such liens or encumbrances upon title and to obtain reimbursement
for its out-of-pocket costs, plus interest at the simple rate of 10% per
annum, from Seller.
Section 4.7. Relocation. The Buyer and Seller agree that
the Transferred Assets are being prepared and positioned for a sale and a
physical relocation out of their current facilities. No representations or
characterizations as to the Seller's ordinary course of business, the
maintenance condition or operation of the Transferred Assets or the results
to be obtained from those assets are being made.
Section 4.8. Due Diligence. This sale includes the
transfer, by operation of and subject to Swiss law, of the Employees,
performing substantially the same work as that being performed by those
employees for the Seller. The Buyer has engaged in such due diligence
effort as it has deemed appropriate prior to signing this Agreement. The
sale of the Transferred Assets is based upon the results of that due
diligence and there has been no reliance upon the representations or
statements of Seller, to Uniphase Corporation or Buyer, other than the
written representations set forth in the Seller's representations in
Article VI of this Agreement, or in the Intellectual Property Agreements,
the Transitional Services Agreement or the Seller Lease.
Section 4.9. Buyer Financial Statements. Seller will
cooperate with Buyer and Buyer's auditors to permit Buyer and Buyer's
auditors to timely prepare and file financial statements relating to the
Transferred Assets, prepared by the Buyer in accordance with United States
generally accepted accounting principles and the rules and regulations of
the Securities and Exchange Commission.
Article V. Representations and Warranties of Buyer.
Buyer hereby represents and warrants to Seller as follows:
Section 5.1. Incorporation. Buyer is a duly incorporated
and validly existing corporation under the laws of Switzerland, with all
requisite corporate power and authority to own its properties and conduct
its business.
Section 5.2. Authority. Buyer has the requisite
corporate power and authority to execute and deliver each of this
Agreement, the Intellectual Property Agreements, the Seller Lease and
Assumption Agreement, and the Transitional Services Agreement, and to
perform its obligations under each of the foregoing. Each of this
Agreement, the Intellectual Property Agreements, the Seller Lease and
Assumption Agreement, and the Transitional Services Agreement, has been
duly and validly authorized, executed and delivered by Buyer and
constitutes the valid and binding agreement of Buyer in accordance with its
respective terms. No other corporate proceedings on the part of Buyer are
necessary to authorize this Agreement, the Intellectual Property
Agreements, the Seller Lease and Assumption Agreement, and the Transitional
Services Agreement and the transactions contemplated by any of the
foregoing.
Section 5.3. No Conflict. The execution and delivery by
Buyer of each of this Agreement, the Intellectual Property Agreements, the
Seller Lease, the Assumption Agreement, and the Transitional Services
Agreement, does not, and the performance of its obligations hereunder and
thereunder, will not:
(a) conflict with, or result in a breach of, any of the
provisions of its Certification of Incorporation or By-Laws;
(b) breach, violate or contravene any applicable law, rule or
regulation of any state or of the United States or any political
subdivision thereof or of Switzerland or any political subdivision thereof,
or any order, writ, judgment, injunction, decree, determination or award,
or create any right of termination or acceleration or encumbrance that in
the aggregate would have a material adverse effect on its authority or
ability to perform either its obligations under this Agreement, the
Intellectual Property Agreements, the Seller Lease, the Assumption
Agreement , the Transitional Services Agreement or the Assumed Liabilities;
or
(c) conflict in any respect with, or result in a breach of or
default under, any contract, license, franchise, permit or any other
agreement or instrument to which it is a party or by which it or any of its
properties may be affected or bound that in the aggregate would have a
material adverse effect on its authority or ability to perform its
obligations under this Agreement, the Intellectual Property Agreements, the
Seller Lease, the Assumption Agreement, or the Transitional Services
Agreement.
Section 5.4. Governmental Consents - Buyer. Other than as
set forth on Schedule 5.4., no material consent, approval or authorization
of, or designation, declaration or filing with, any governmental agency or
authority on the part of Buyer is required in connection with the execution
or delivery by Buyer of this Agreement, the Intellectual Property
Agreements, the Seller Lease, the Assumption Agreement, and the
Transitional Services Agreement or the consummation by Buyer of the
transactions contemplated by any of the foregoing, other than the
authorization in connection with the Seller Lease, according to the Swiss
▇▇▇ ▇▇▇▇▇▇▇▇▇ to be obtained by Seller, and other than the authorization of
the competent authorities with respect to the transfer of the foreign
Employees having work permits from Seller to Buyer, to be obtained by Buyer
and other than the future Swiss Pension Transfer Agreement and the fact
that Uniphase Corporation has formed Buyer in Switzerland to utilize the
Transferred Assets, which will require a filing in the Swiss Commercial
Register.
Section 5.5. No Broker. Buyer and Uniphase Corporation
have engaged no corporation, firm or other person who is entitled to any
fee or commission as a finder or a broker in connection with the
negotiation of this Agreement or the consummation of the transactions
contemplated hereby, and Buyer shall be responsible for all liabilities and
claims (including costs and expenses of defending against same) arising in
connection with any claim by a finder or broker that it acted on behalf of
Buyer or Uniphase Corporation in connection with the transactions
contemplated hereby.
Article VI. Representations and Warranties of Seller.
Seller hereby represents and warrants to Buyer as follows:
Section 6.1. Incorporation. Seller is a duly incorporated
and validly existing corporation in good standing under the laws of the
State of New York, with all requisite corporate power and authority to own
its properties and conduct its business, and is duly qualified in each
jurisdiction in which its ownership of property requires such qualification
except where the failure to so qualify would not have a material adverse
effect upon the Transferred Assets or the ability of Seller to perform its
obligations hereunder.
Section 6.2. Authority. Seller has the requisite
corporate power and authority to execute and deliver this Agreement, the
Seller Lease and Assumption Agreement, the ▇▇▇▇ of Sale, the Transitional
Services Agreement and the Intellectual Property Agreements, and to perform
its obligations under each of the foregoing. Each of this Agreement, the
Seller Lease and Assumption Agreement, the ▇▇▇▇ of Sale, the Transitional
Services Agreement, and the Intellectual Property Agreements, has been duly
and validly authorized, executed and delivered by Seller and constitutes
the valid and binding agreement of Seller in accordance with its respective
terms. No other corporate proceedings on the part of Seller are necessary
to authorize this Agreement, the Intellectual Property Agreements, the
Seller Lease and Assumption Agreement, the ▇▇▇▇ of Sale, and the
Transitional Services Agreement, and the transactions contemplated by any
of the foregoing.
Section 6.3. No Conflict. The execution and delivery by
Seller of this Agreement, the Intellectual Property Agreements, the Seller
Lease and Assumption Agreement, the ▇▇▇▇ of Sale, and the Transitional
Services Agreement does not, and the performance by Seller of its
obligations hereunder and thereunder will not:
(a) conflict with, or result in a breach of, any of the
provisions of its Certificate of Incorporation or By-Laws;
(b) breach, violate or contravene any applicable law, rule or
regulation of the United States or any political subdivision thereof, or
Switzerland or any political subdivision thereof, or any order, writ,
judgment, injunction, decree, determination or award, or create any right
of termination or acceleration or encumbrance that, in the aggregate would
have a material adverse effect on the Transferred Assets; or
(c) conflict in any respect with, or result in a breach of or
default under, any contract, license, franchise, permit or any other
agreement or instrument to which Seller is a party or by which it or any of
the Transferred Assets may be bound that in the aggregate would have a
material adverse effect on the Transferred Assets (except for agreements
and instruments that require the consent or approval of a third party for
the transactions contemplated by this Agreement).
Section 6.4. Governmental Consents - Seller. Other than
as set forth on Schedule 6.4, no material consent, approval or
authorization of, or designation, declaration or filing with, any
governmental agency or authority on the part of Seller is required in
connection with the execution or delivery by Seller of this Agreement, the
Intellectual Property Agreements, the Seller Lease, the Assumption
Agreement, the ▇▇▇▇ of Sale, or Transitional Services Agreement or the
consummation by Seller of the transactions contemplated by any of the
foregoing other than the authorization in connection with the Seller Lease,
according to the Swiss ▇▇▇ ▇▇▇▇▇▇▇▇▇ to be obtained and other than the
future Swiss Pension Transfer Agreement.
Section 6.5. No Broker. Seller has engaged no
corporation, firm or other person who is entitled to any fee or commission
as a finder or a broker in connection with the negotiation of this
Agreement or the consummation of the transactions contemplated hereby, and
Seller shall be responsible for all liabilities and claims (including costs
and expenses of defending against same) arising in connection with any
claim by a finder or broker that it acted on behalf of Seller in connection
with the transactions contemplated hereby.
Section 6.6. Title to Personal Property. Seller has good
and marketable title to all tangible personal property listed on Schedules
1.1.A., 1.1.B., 1.1.C., hereto, free and clear of any material liens or
encumbrances.
Section 6.7. Actions, Suits, Proceedings. Other than as
set forth on Schedule 6.7, there are no actions, suits, or proceedings
pending or, to Seller's knowledge, threatened against the Transferred
Assets, at law or in equity, including any administrative proceedings with
any regulatory authority; and no third party claims have been asserted
against Seller or its affiliates with respect to the Transferred Assets.
There is no existing default by Seller or, to the knowledge of Seller, any
of its affiliates with respect to any judgment, order, writ, injunction or
decree of any governmental authority or arbitrator which materially
adversely affects the Transferred Assets.
Section 6.8. No Rights In Others To Transferred Assets.
Neither Seller nor any affiliate of Seller is party to any outstanding
contracts or other arrangements giving any person any present or future
right to require Seller to transfer to any person any ownership or
possessory interest in, or to grant any lien on, any of the Transferred
Assets, other than pursuant to this Agreement.
Section 6.9. Contracts. Schedule 1.4.A. contains a true
and complete list of all material customer or vendor contracts constituting
the Transferred Assets. Seller has performed or is performing all material
obligations required to be performed by it under such contracts and is not
(with or without notice, lapse of time or both) in breach or default in any
material respect thereunder; and, to the knowledge of Seller, no other
party to any of such contracts is (with or without notice of time or both)
in breach or default in any material respect thereunder.
Section 6.10. Licenses and Permits. Seller or its
affiliates have the licenses and permits and other governmental
authorizations and approvals as set forth on Schedule 6.10. All such
licenses and permits held by Seller which are material to the use of the
Transferred Assets are valid and in full force and effect. Buyer has made
its own investigation of such matters and is responsible for obtaining such
regulatory approvals for its operations after the Closing. To the personal
knowledge of the four most senior level executives among the Employees, as
expressed to the Buyer prior to the signing of this Agreement during due
diligence, they do not believe the operation of the Transferred Assets, as
operated by the Seller immediately prior to the date of this Agreement,
violated any applicable law.
Section 6.11. Employee Union. No union organizing
activities are in progress or, to Seller's knowledge, threatened at
Seller's facilities concerning the Employees.
Section 6.12. Exclusive Warranties. Except for the
express representations and warranties made by Seller in this Article VI,
Seller makes no representation or warranty, express or implied, concerning
the Transferred Assets, it being specifically understood by Buyer that,
except for the express warranties set forth in this Article VI, the
Transferred Assets are being sold "AS IS" in all respects. SELLER
SPECIFICALLY DISCLAIMS ANY WARRANTY OF MERCHANTABILITY OR SUITABILITY OR
FITNESS FOR ANY PARTICULAR PURPOSE OF BUYER'S, WHETHER OR NOT SELLER HAS
BEEN MADE AWARE OF ANY SUCH PURPOSE. SELLER SHALL NOT BE RESPONSIBLE FOR
ANY INDIRECT, SPECIAL OR CONSEQUENTIAL DAMAGES OF BUYER WHATSOEVER,
INCLUDING LOSS OF PROFITS OR GOODWILL, IN CONNECTION WITH THIS TRANSACTION.
Section 6.13. Book Value. Seller makes no representations
or warranties as to the book value, for tax or for accounting purposes, of
any of the Transferred Assets.
Article VII. General.
Section 7.1. Survival of Representations and Warranties.
All representations and warranties made by the Parties in this Agreement or
any agreement contemplated by this Agreement shall survive the Closing for
a period of twenty-four (24) months after the Closing Date, provided, that,
the representations and warranties in respect of Taxes shall survive the
Closing Date until the applicable period of limitation on assessment or
refund of any relevant Tax has expired.
Section 7.2. Limitation of Liability. Unless the
application of this Section is specifically excluded in writing,
notwithstanding anything to the contrary set forth in this Agreement, the
▇▇▇▇ of Sale, the Seller Lease, the Assumption Agreement, the Transitional
Services Agreement, or the Intellectual Property Agreements, Seller shall
not be liable hereunder or thereunder for any amounts with respect to the
breach of a representation and warranty unless and until such amounts shall
exceed in the aggregate amount $250,000 (the "Limitation Amount"), in which
case Seller shall only be liable with respect to the excess over the
Limitation Amount. In addition, in no event shall Seller's liability with
respect to the breach of representations and warranties exceed $11,000,000
in the aggregate.
Section 7.3. Public Announcements. Under Article 181(2)
of the Swiss Code of Obligations the Seller may be jointly and severally
liable to third parties for its transferred business activities for two
years from a notification or publication date of this transaction following
the Closing. The Parties shall each individually have the right to decide
whether to publicize the transaction of the assets and/or to inform
personally or by circular letter the relevant creditors, customers and
vendors. Any disclosures in connection with commercial relationships shall
not reveal the Purchase Price of this Agreement. Notwithstanding the
foregoing, each Party shall have the right, in its sole discretion, to make
such disclosures as it may deem necessary or advisable to any governmental
agencies or instrumentalities or regulatory bodies.
Section 7.4. Costs. Each Party shall be responsible for
the costs and expenses incurred by it in the negotiation, execution and
delivery of this Agreement and, except as otherwise provided elsewhere in
this Agreement, the consummation of the transactions contemplated hereby.
Section 7.5. Bulk Sales. Buyer and Uniphase Corporation
hereby waive compliance with any applicable bulk sales or similar laws in
the United States or Swiss jurisdictions. Buyer intends to discharge the
Assumed Liabilities in accordance with their terms and the Buyer agrees
that the Seller shall have no liability for any failure of Buyer to
discharge the Assumed Liabilities in accordance with their terms.
Section 7.6. Modification and Waiver. No modification or
waiver of any provision of this Agreement and no consent by any Party
hereto to any departure therefrom shall be effective unless in a writing
referencing the particular article of this Agreement to be modified or
waived and signed by a duly authorized officer of each Party, and the same
will only then be effective for the period and on the conditions and for
the specific instances and purposes specified in such writing.
Section 7.7. Governing Law. This Agreement has been
delivered at and shall be deemed to have been made at Armonk, New York, and
shall be interpreted, and the rights and liabilities of the parties hereto
determined, in accordance with the laws of the State of New York applicable
to agreements executed, delivered and performed within such State, without
regard to the principles of conflicts of laws thereof, provided, however,
that the Parties agree to apply and comply with all mandatory provisions of
the laws of Switzerland applicable to this transaction as a matter of Swiss
public policy, which provisions are applicable regardless of the Parties
choice of law.
As part of the consideration for value this day received, each of
the Parties hereby consents to the jurisdiction of any state or federal
court located within the county of Westchester in the State of New York.
Each of the Parties hereby: (i) waives trial by jury, (ii) waives any
objection to venue of any action instituted hereunder and (iii) consents to
the granting of such legal or equitable relief as is deemed appropriate by
any aforementioned court. These consents and waivers apply to all the
agreements contemplated by this Agreement.
Section 7.8. Notices. All notices and other
communications hereunder shall be in writing and shall be deemed to have
been duly given and shall be effective (a) when delivered by messenger or
courier, or (b) five days after deposit for mailing by registered or
certified mail, postage prepaid, return receipt requested, when also
transmitted by telecopy, as follows:
(a) if to Seller, to:
International Business Machines Corporation
▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇ ▇. ▇▇▇▇▇▇
with a copy to:
▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇, Esq.
(b) if to Buyer or Uniphase Corporation, one copy to:
Uniphase Laser Enterprise AG
c/o Uniphase Corporation
▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇ ▇. ▇▇▇▇▇▇
with a copy to:
▇▇▇▇▇▇▇▇ & ▇▇▇▇▇▇▇▇, LLP
▇▇▇ ▇▇▇▇ ▇▇▇▇ ▇▇▇▇
▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇, Esq.
or to such person or address as either of the parties shall hereafter
designate to the other from time to time by similar written notice.
Section 7.9. Assignment. This Agreement shall be binding
upon, and inure to the benefit of, and be enforceable by, the successors
and assigns of the Parties; provided, that, no Party may assign its rights
hereunder without the written consent of the other Party.
Section 7.10. Counterparts. This Agreement may be
executed by the Parties hereto in one or more counterparts, each of which
shall be an original and all of which shall constitute one and the same
instrument.
Section 7.11. Guarantee. Uniphase Corporation hereby
guarantees the performance, as and when due, by the Buyer of all Buyer
obligations under this Agreement, the Patent License Agreement, the
Technology License Agreement, the Seller Lease, the Agreement for Exchange
of Confidential Information between Buyer and Seller signed March 10,1997,
and the Transitional Services Agreement referenced herein, including,
without limitation, the payment by the Buyer of the consideration set forth
in Section 1.3. of this Agreement and all amounts payable by Buyer under
the other documents referenced above.
Section 7.12. Entire Agreement. This Agreement (including
its schedules and exhibits), together with the Patent License Agreement,
the Technology License Agreement, the Transitional Services Agreement, and
the Seller Lease, all dated the same date hereof, by and among the Seller
and either Uniphase Corporation or the Buyer, and the Confidentiality and
Nondisclosure Agreement, dated November 22, 1996, between Uniphase
Corporation and Seller, comprise the entire agreement between the Parties
with respect to the subject matter hereof and supersede all prior
agreements, understandings and representations, oral or written, between
Seller, Buyer, and Uniphase Corporation relating hereto.
IN WITNESS WHEREOF, the parties have caused this Agreement to be
executed by their duly authorized officers as of the date and year first
above written.
UNIPHASE CORPORATION INTERNATIONAL BUSINESS
MACHINES CORPORATION
By: \s\ ▇▇▇▇▇ ▇. ▇▇▇▇▇▇ By: \s\ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇
Title: Vice President, Finance and CFO Title: Business Development
Consultant
Uniphase Laser Enterprise AG
By: \s\ ▇▇▇▇▇ ▇. ▇▇▇▇▇▇
Title: Vice President, Finance and CFO
SCHEDULES
Schedule 1.1. Asset Listing
Schedule 1.1. is comprised entirely of the following
Schedules:
1.1.A.
1.1.B.
1.1.C.
1.1.D.
Schedule 1.1.A. Production Equipment
Schedule 1.1.B. Office Furniture/Equipment
Schedule 1.1.C. Inventory and Work in Process
Schedule 1.1.D. Accounts Receivable Report
Schedule 1.4.A.1. Assumed Liabilities
Schedule 1.4.A.2. Assumed Liabilities
Schedule 1.4.B. Internal Contracts with Seller or Seller's affiliates
that will be transferred to Buyer
Schedule 3.1. Allocation of Purchase Price
Schedule 4.1. Consents to Assignments
Schedule 4.2.A. Employees
Schedule 4.2.C. Seller's Swiss Staff Member Manual
Schedule 6.7. Actions, Suits, Proceedings
Schedule 6.10. Licenses and Permits
Exhibit A: Assumption Agreement
Exhibit B: ▇▇▇▇ of Sale
Exhibit C: Transitional Services Agreement
Exhibit D: Seller Lease
Exhibit E: Pension Matters
Schedule 1.1.A Production Equipment and
Schedule 1.1.B Office Furniture/Equipment
These schedules contain a detailed description of each of the assets
including furniture, production equipment and computer equipment acquired
for the operations of Uniphase Laser Enterprise.
Schedule 1.1.C Inventory and Work in Progress
This schedule contains the number of chips in inventory as of the
close date.
Schedule 1.1.D Accounts Receivable Report.
The schedule contains a detail listing of aged accounts receivable by
customers for a total amount of $7.0 million as of the close date.
Schedule 1.4.A.1 Assumed Liabilities - Contracts
The schedule contains a listing of contracts for services and
agreements assumed as of the close date.
Schedule 1.4.A.2 Assumed Liabilities
A detailed listing of capital services, and materials ordered but not
received that have been assumed as of the close date.
Schedule 1.4.B Internal Contracts with Seller or Seller's affiliates that
will be transferred to Buyer.
A listing of IBM contracts that were transferred to the buyer as of
the close date.
Schedule 3.1 Allocation of Purchase Price
An allocated schedule of the assets acquired as of the close date.
Schedule 4.1 Consent to Assignments
A listing of contracts that require the consent of a third party to be
transferred or terminated/novated to/with Buyer.
Schedule 4.2.A Employees
A listing of employees in Uniphase Laser Enterpriseas of the closed
date.
Schedule 4.2.C Seller's Swiss Staff Member Manual
A copy of the Swiss Staff Member Manual.
Schedule 6.4 Government Consents - Seller
A listing of governmental consents.
Schedule 6.7 Actions, Suits, Proceedings
There are no actions, suits, or proceedings to report.
Schedule 6.10 Licenses and Permits
A listing of licenses and permits which are material to the use of the
Transferred Assets.
ASSIGNMENT AND ASSUMPTION AGREEMENT
dated as of March 10, 1997 (this "Agreement"), between
UNIPHASE LASER ENTERPRISE AG, a Swiss AG ("Buyer"), and
INTERNATIONAL BUSINESS MACHINES CORPORATION,
a New York corporation ("Seller").
WHEREAS Buyer, Seller and Uniphase Corporation have entered into
a Purchase Agreement dated as of March 10, 1997 (the "Purchase Agreement"),
providing for, among other things, the purchase by Buyer of the Transferred
Assets from Seller; and
WHEREAS, in conjunction with such purchase, Seller desires to
sell, transfer, convey, assign and deliver to Buyer all of Seller's rights,
title and interest in and to the Assumed Liabilities, which form part of
the Transferred Assets.
NOW, THEREFORE, in consideration of the mutual convenants and
undertakings contained herein, and subject to and on the terms and
conditions herein set forth, the parties hereto agree as follows:
1. Defined Terms. Terms defined in the text of this Agreement
shall have such meaning throughout this Agreement.
2. Other Terms. All capitalized terms not otherwise defined
herein shall have the meanings ascribed thereto in the Purchase Agreement.
Nothing contained herein shall be deemed to alter or amend the terms and
provisions of the Purchase Agreement, and in the event of any conflict
between the terms and provisions of this Agreement and the Purchase
Agreement, the terms and provisions of the Purchase Agreement shall be
deemed to govern and be controlling in all circumstances.
3. Assignment. Seller hereby irrevocably sells, transfers,
conveys, assigns and delivers to Buyer all of its right, title and interest
in and to the Assumed Liabilities.
4. Assumption. Buyer does hereby accept such sale, transfer,
conveyance, assignment and delivery of all of seller's right, title and
interest in and to the Assumed Liabilities by Seller and, subject to the
terms of Section 1.4 of the Purchase Agreement, assumes all obligations and
liabilities of Seller thereunder.
5. Effective time. The assignment by Seller, and the
acceptance thereof by Buyer, of the Assumed Liabilities, pursuant to this
Agreement, shall be effective as of the date hereof.
6. Noncontravention. Pursuant to Section 4.1 of the Purchase
Agreement, certain of the Assumed Liabilities may require the consent of
third parties to any assignment. Such assignments to Buyer are made
subject to the obtaining of such consents and shall be effective as of the
date of such consent. The execution of this Agreement shall not be
interpreted, and is not intended to be interpreted, as any action taken by
Seller that would be contrary to the terms and conditions of any contract
requiring the consent of any third party to such assignment. Buyer and
Seller shall fully cooperate with each other in an attempt to obtain such
consents, as set forth in the Purchase Agreement.
7. Notices. All notices and other communications hereunder
shall be as set forth in the Purchase Agreement.
8. Amendment. This Agreement may be amended, modified or
supplemented, and any provision hereof may be waived, only by written
agreement of the parties hereto.
9. Headings. The headings contained in this Agreement are for
reference purposes only and shall not limit or otherwise affect the meaning
or interpretation of this Agreement.
10. Governing Law. This Agreement shall be construed and
enforced in accordance with, and the rights of the parties shall be
governed by, the laws of the State of New York without reference to its
principles of conflict of law.
11. Severability. If any one or more provisions contained in
this Agreement, or the application of such provision to any person or
circumstance, shall, for any reason, be held to be invalid, illegal or
unenforceable in any respect, such invalidity, illegality or
unenforceability shall not affect any other provision hereof, and this
Agreement shall be construed as if such invalid, illegal or unenforceable
provision had never been contained herein.
12. Third Party Actions. Seller and Buyer hereby agree to
cooperate in defending or prosecuting any claims or litigation relating to
the transfer of title as provided herein, and to make available and furnish
appropriate documents and testimony in connection therewith.
13. Seller's Obligations. Seller hereby covenants and agrees to
execute and deliver all such other further instruments of conveyance,
assignment and transfer and all such other notices, releases, acquittance,
powers of attorney and other documents, and do all such other acts and
things as may be necessary to more fully convey and assign to buyer, or its
successors or assigns, all right, title and interest in and to the Assumed
Liabilities conveyed, assigned and transferred to or acquired by Buyer
pursuant to this Agreement, including, without limitation, filings with any
governmental entity, authority or instrumentality, domestic or foreign.
14. Assignment. Pursuant to Section 7.9 of the Purchase
Agreement neither this Agreement nor any of the rights or obligations
hereunder shall be assigned by either party hereto without the prior
written consent of the other party, such consent not to be unreasonably
withheld, except that Buyer may assign any or all of its rights and
obligations hereunder to one or more Affiliates. Any purported assignment
of this Agreement other than in accordance with this paragraph 17 shall be
null and void and of not force or effect.
18. Counterparts. This Agreement may be executed in two or more
counterparts, each of which shall be deemed an original, but all of which
together shall constitute one and the same instrument and shall become a
binding Agreement when one or more of the counterparts have been signed by
each of the parties and delivered to the other party.
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
executed by their respective officers thereunto duly authorized as of the
day and year first above written.
UNIPHASE LASER ENTERPISE AG
by: \s\ ▇▇▇▇▇ ▇. ▇▇▇▇▇▇
Title: Vice President, Finance and CFO
INTERNATIONAL BUSINESS
MACHINES CORPORATION
by: \s\ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇
Title: Business Development Consultant
▇▇▇▇ OF SALE
▇▇▇▇ of Sale and Assignment (this "▇▇▇▇ of Sale") dated as of
March 10, 1997 , between International
Business Machines Corporation, a New York corporation ("Seller"),
and Uniphase Laser Enterprise AG, a Swiss AG ("Buyer").
Buyer, Seller, and Uniphase Corporation, a Delaware corporation,
have entered into a Purchase Agreement dated as of March 10, 1997 (the
"Purchase Agreement"), for the sale by Seller to Buyer of certain
Transferred Assets as described in the Purchase Agreement. All capitalized
terms not otherwise defined herein shall have the respective meanings
provided in the Purchase Agreement.
NOW THEREFORE, for good and valuable consideration (including the
payment by Buyer of the purchase price for the Transferred Assets), the
adequacy and receipt of which are hereby acknowledged:
1. Seller does hereby sell, assign, transfer, convey and
deliver (collectively, "sell") to Buyer, free and clear of all obligations
and liabilities except as expressly provided herein or in the Purchase
Agreement:
2. This ▇▇▇▇ of Sale shall not constitute a waiver of any
rights and remedies of Buyer under the Purchase Agreement with respect to
any of the Transferred Assets hereby sold to Buyer.
3. Upon request of Buyer, Seller shall do, execute, acknowledge
and deliver all such further acts, assurances, deeds, assignments,
transfers, conveyances and other instruments and papers as may be required
to sell to and vest in Buyer, and protect Buyer's right, title and interest
in and enjoyment of, the Transferred Assets and as otherwise may be
appropriate to carry out the transactions contemplated by the Purchase
Agreement. Pursuant to Section 4.1 of the Purchase Agreement, to the
extent that any Transferred Asset may not be sold to Buyer without the
consent of any other party, this Agreement shall not constitute a sale or
attempted sale thereof if such sale or attempted sale requires a consent.
Such sale shall occur immediately after receipt of the applicable consent.
4. This ▇▇▇▇ of Sale shall be governed by and construed in
accordance with the internal laws of the State of New York applicable to
agreements made and to be performed entirely within such State, without
regard to the conflicts of law principles of such State.
5. In the event any one or more of the provisions contained in
this ▇▇▇▇ of Sale should be held invalid, illegal or unenforceable in any
respect, the validity, legality and enforceability of the remaining
provisions contained herein and therein shall not in any way be affected or
impaired thereby. The parties shall endeavor in good-faith negotiations to
replace the invalid , illegal or unenforceable provisions with valid
provisions the economic effect of which comes as close as possible to that
of the invalid, illegal or unenforceable provisions.
6. This ▇▇▇▇ of Sale is executed pursuant to the Purchase
Agreement and is entitled to the benefits and subject to the provisions
thereof and shall bind and inure to the benefit of the parties and their
respective successors and assigns.
IN WITNESS WHEREOF, the parties have caused this ▇▇▇▇ of Sale to
be duly executed as of the day and year first above written.
UNIPHASE LASER ENTERPRISE AG INTERNATIONAL BUSINESS
MACHINES CORPORATION
By: \s\ ▇▇▇▇▇ ▇. ▇▇▇▇▇▇ By: \s\ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇
Title: Vice President, Finance and CFO Title: Business Development
Consultant
Services Agreement
(the "Services Agreement")
between
Uniphase Laser Enterprise AG, Zug,
▇/▇ ▇▇▇▇▇▇▇▇ ▇▇▇ ▇▇▇▇ ▇▇, ▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇, ▇▇▇▇ ▇▇▇
(hereinafter referred to as the "Lessee")
on one hand
and
International Business Machines Corporation, Zurich Research Laboratory,
▇▇▇▇▇▇▇▇▇▇▇▇▇ ▇, ▇▇- ▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇,
(hereinafter referred to as the "Lessor")
on the other hand
____________________
Whereas, the Lessor wishes to sell Uniphase Corporation and to the
Lessee, and Uniphase Corporation and the Lessee wishes to purchase
from the Lessor the Transferred Assets as defined in the Purchase
Agreement (as defined below)
Whereas, the Lessee, Uniphase Corporation and the Lessor for this
purpose have entered into purchase agreement dated of even date
herewith (hereinafter referred to as the "Purchase Agreement"), and
Whereas, the Lessor and the Lessee have entered into a Lease
Agreement for certain offices, cleanroom, wet and dry laboratories,
and common rooms in the premises of Saumerstrasse, Ruschlikon,
Switzerland, owned by the Lessor, during a transitional period
following the execution of the Purchase Agreement (hereinafter
referred to as the "Lease Agreement"); and
Whereas, the Lessor and the Lessee intend, during such transitional
period following the execution of the Purchase Agreement to provide
and receive partly on mandatory and partly on optional basis
respectively certain basic support and administrative services; and
Whereas, on the other hand, the Parties agree that there are
certain services which Lessor provides for its departments, which
will not be available to the Lessee.
Now therefore in consideration of the mutual covenants and
undertakings herein contained the parties hereto agree as follows:
1. Subject Matter of the Agreement
1.1. The subject matter of the Services Agreement is to set
forth the conditions under which Lessor will provide services
to the Lessee for the term of the Lease Agreement. In this
respect it is to be distinguished between:
a) Such services which the Lessee has the duty and the
right to make use of and the Lessor has the obligation to
provide for the term of the Lease Agreement (hereinafter
referred to as "Mandatory Services"); and
b) such services which the Lessee may, at its option, take
advantage of (hereinafter referred to as "Optional
Services").
1.2. The Lessee acknowledges and agrees that the Lessor is
offering no services other than those hereinbefore mentioned
and which are hereinafter defined as Mandatory and Optional
Services.
2. Mandatory Services
2.1. Mandatory Services including specific prerequisites and
conditions of the same are set forth in Schedule 1.
2.2. The Lessor undertakes with the execution of the Services
Agreement to provide the mandatory services in accordance with
the remaining provisions of this agreement for the entire term
of the Lease Agreement.
2.3. The Contracting Parties agree that according to the
provisions of Section 9.7. and 10.1. of the Lease Agreement
they are obligated to make use of or to carry out the Mandatory
Services for as long as the term of the Lease Agreement lasts.
3. Optional Services
3.1. The Optional Services which may be required by the Lessee
for the term of the Services Agreement are set forth in
Schedules 2 and 3.
3.2. Schedule 2 sets forth such Optional Services including the
specific prerequisites and conditions which the Lessee may
request in writing from the Lessor (hereinafter referred to as
"Optional Services Category 1").
3.3. Schedule 3 sets forth a general description of such
services which the Lessor is offering to the Lessee whereby the
prerequisites and the conditions have not been set forth
(hereinafter referred to as "Optional Services Category 2").
In the event that the Lessor wishes to take advantage of any
such individual service, the Parties shall enter into an
additional agreement regarding such services. Any such
additional agreement shall supplement the Services Agreement by
way of a Schedule thereto. As far as such additional agreement
does not foresee any special regulation, the rules of the
Services Agreement shall be applicable.
3.4. The Lessee acknowledges and agrees that the Lessor shall
carry out all such Optional Services as shall be required
according to the availability of the same whereby the Lessor,
in using its resources, may primarily take into account its own
needs.
3.5. The Lessee is aware that in the event the Lessee calls
upon third parties for the purpose to carrying out the Services
of model shop, electronic services, shared tools, cafeteria,
self-service model shop (as referenced in Optional Services
Category 1. Schedule 2), the provision thereof shall occur
outside the Site. The facilities of the Lessor cannot be used
for this purpose.
4. Extent and Provision of Services
4.1. The Lessor agrees to provide the services under this
Services Agreement with the appropriate care and diligence.
The standard of assistance on the part of the Lessor is to be
measured with respect to the contents as well as the standard
of care, in accordance with the past services of the Lessor of
the particular service within its enterprise.
The Lessee confirms that as a result of the level of knowledge
of such employees as it has assumed, it has adequate knowledge
of the standard of the previous provision of services.
4.2. The Lessor is entitled to call upon third parties for the
purpose of carrying out the services hereunder.
5. Place of Performance
The place of performance of all of the services provided for in the
Services Agreement is in the Leased Premises according to the Lease
Agreement.
6. Deadlines
6.1. Inasmuch as no distinct rule has been agreed to in
writing, the Lessor shall provide the services during working
days only, from Monday to Friday, from 8.00 a.m. till 5.00
p.m., according to the availability of the resources pursuant
to Section 3.4. hereof.
6.2. In the event that circumstances beyond its own control,
namely the failure of third party suppliers to observe
deadlines should lead to postponements on the part of the
Lessor, then deadlines shall be correspondingly postponed.
7. Term of the Agreement
7.1. The term of the Services Agreement shall begin on the
Closing Date of the Purchase Agreement and shall remain in
force for as long as the Lease Agreement shall remain in
effect.
7.2. Upon termination of the entire Lease Agreement, the
Services Agreement shall terminate automatically.
8. Early Termination of Individual Service Requirements
8.1.The Mandatory Services have been agreed to for the entire term
of the Services Agreement and the Lease Agreement. Except in
case of the early termination of the entire Lease Agreement, it
may not be terminated early by either the Lessor or the Lessee.
8.2.Any item of the Optional Services Category 1 may be terminated
by both Parties by means of written notice with a notice period
of 60 days effective as of the end of the calendar month next
following the expiration of the notice period.
The Lessor shall remain obligated for the remaining term of
this agreement to provide Optional Services Category 1
according to the remaining provisions of the Services
Agreement.
8.3.With respect to the termination of the provision of Optional
Services of Category 2 the same shall be governed by the
relevant terms of the individual supplementary agreement
entered into with respect thereto.
9. Duty to provide Information on the Part of the Lessee
The Lessee shall provide to the Lessor all information reasonably
required by the Lessor for the Lessor to perform its obligations
hereunder.
10. Liability
10.1. Each Party is solely responsible and liable for its
employees and its respective performance under this Services
Agreement.
10.2. The Lessor shall not have any liability to the Lessee with
respect to the performance of its obligation pursuant to the
Services Agreement, except for direct damages subject to the
limitation in Section 10.4. incurred by the Lessee as a result
of the breach of the Services Agreement by the Lessor. In no
event will the Lessor be liable to the Lessee for loss of
revenue or profits or any indirect damages including claims of
third parties.
10.3. Should the subject matter of the Services Agreement be the
provision of products which the Lessor for its part is
obviously provided with by a third party, the Lessor shall only
be liable to the Lessee to the extent that the third party
supplier has provided the Lessor with a warranty and is liable
to the Lessor.
10.4. If damages do not exceed SFr. 5'000.-- per event, the
Lessor shall not be liable. If damages exceed SFr. 5'000.-- the
Lessor's total liability for such event will be limited to SFr.
200'000.--. However, the cumulative liability of the Lessor
during the term of the Services Agreement will not exceed SFr.
1'000'000.--. This limitation shall not apply in case of
personal injury.
10.5. Notwithstanding the foregoing, the Lessor shall not be
liable for any failure of performance attributable to acts or
events (including, but not limited to, war, conditions or
events of nature, government acts or regulations, civil
disturbances, work stoppage, power failures, failure of
telephone lines and equipment, fire and flood) beyond the
control of the Lessor which rendered performance by it
hereunder impossible.
10.6. Any further liability or warranty is excluded.
11. Intellectual Property
The Parties will agree to negotiate intellectual property rights
for intellectual property that arises from the result of the work
performed by Lessor for the Lessee hereunder under Optional
Services Category 1 / Model Shop and Electronic Services prior to
the provision of such services.
12. Remuneration
12.1. The remuneration of the Mandatory Services is set forth in
Schedule 1.
12.2. The remuneration of the Optional Services Category 1 is
set forth in Schedule 2.
12.3. The remuneration of the Optional Services Category 2 shall
be determined by the relevant terms of the individual
supplementary agreement entered into with respect thereto.
12.4. The remuneration for the supplied services shall be
invoiced at the end of each month. Unless the Lessee does not
react within thirty days from the receipt of the invoice, the
acceptance thereof is deemed. The payment shall occur within 30
days from the date of the invoice.
13. Compliance with Laws
13.1. The Lessor represents that it will provide the services under
this Services Agreement in compliance with the applicable laws
for example environmental protection laws.
13.2. The Lessee represents that it will use the services under
this Services Agreement in compliance with the applicable laws
for example environmental protection laws.
14. Final Provisions
14.1. The Services Agreement shall be governed by and construed
in accordance with the laws of Switzerland.
14.2. In case any provision of the Services Agreement shall be
held invalid, illegal or unenforceable, the validity, legality
and enforceability of the remaining provisions shall not in any
way be affected or impaired thereby.
14.3. The court of jurisdiction is Horgen.
14.4. This Agreement supersedes any and all previous agreements
whether written or oral with respect to the subject matter and
may not be amended unless in writing.
____________________
Place, Date Place, Date
3-10-97 3-10-97
The Lessee The Lessor
\s\ ▇▇▇▇▇ ▇. ▇▇▇▇▇▇ \s\ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇
Mandatory Services
1. Building Operations Services
1.1.For the purposes of the Services Agreement building operation
services mean the performance of all maintenance necessary to the
building and the Leased Premises and to integral parts thereof. All
measures which affect the building are exclusively controlled by
the Lessor.
According to Section 9.7. and Section 10.1 of the Lease Agreement
the Lessor shall carry out the following services:
a) Laboratory rearrangements (excluding construction related
projects)
b) Maintenance
c) Repairs
d) Installations and changes on installations
e) Janitor Service
f) Cleaning
g) Recycling
▇.▇.▇▇▇ up arrangements are not included. Repairs and maintenance
services are not provided for the Lessee's assets.
1.3.Dependent on the urgency, the Lessor shall carry out the requested
services. The Lessor may set priorities. The Lessor will set high
priority to temperature and humidity control of cleanrooms,
maintaining the emergency electrical system and maintaining cooling
water.
1.4.The Lessor's contact person is ▇▇▇▇ ▇▇▇▇▇▇▇▇▇. The Lessee's contact
person is ▇▇▇▇ ▇▇▇▇▇▇.
2. Chemical Services
2.1.Chemical services cover all those measures and transactions in
connection with chemicals.
Chemical services include following services:
a) Authorization
b) Internal supply of chemicals
c) Control
d) Waste disposal
e) Education and support
f) Storage
2.2.The Lessor has the right to exercise control over chemicals used on
the site.
2.3.All orders of chemicals must be authorized by the Lessor. The
Lessor may refuse a request of order of the Lessee for reasonable
safety reasons or if the storage of the requested quantities cannot
be reasonably guaranteed.
However, the Lessee shall be responsible for the punctual request
of the necessary orders with due regard of the handling of the
request by the Lessor and of the time for delivery.
2.4.The Lessor will take delivery of the chemicals and check them in
respect of the ordered quantity. No quality checks will be carried
out by the Lessor.
2.5.The Lessor will store all the delivered chemicals of the Lessee in
the appropriate premises in an identifiable manner. Once the
chemicals are delivered to the Lessee, the Lessee is responsible
for the storage and usage in accordance with the rules of the
Safety Manual as mentioned under Section 3.1. of this Schedule.
2.6.The Lessor is prepared to give further reasonable advice, counsel
and provide for the education of the Lessee's employees upon
request by the Lessee.
2.7.During working time as referred to in Section 6.1. of the Services
Agreement the Lessor will use all reasonable effort to provide for
the performance of chemical services at any time the Lessee deems
it necessary.
2.8.The Lessor's contact person for request of orders and further
advice is ▇▇▇▇ ▇▇▇▇▇▇. The Lessee's contact person is ▇▇▇▇▇
▇▇▇▇▇▇▇▇.
3. Safety Services
▇.▇.▇▇▇▇▇▇ services provided for the protection of the employees.
Safety services include following services:
a) Control of new equipment/Installations
b) Advice and counsel
c) Safety equipment and material
d) Education
e) Safety manual
3.2.The safety of all delivered new equipments and installation shall
be checked by the Lessor according to the Safety Manual and the
usual standards of the Lessor. The control of the Lessor does not
include further inspections. The control by the Lessor does not
relieve the Lessee of his liabilities.
3.3.The Lessor has published for use on the site only a Safety Manual,
where all essential safety rules are entailed. The Lessee is in
possession of this manual and must strictly follow these rules.
3.4.The Lessor is ready to give further reasonable advice and provide
for the education of the Lessee's employees upon request by the
Lessee.
3.5.The Lessor's contact person is ▇▇▇▇ ▇▇▇▇▇▇. The Lessee's contact
person is ▇▇▇▇▇ ▇▇▇▇▇▇▇▇.
3.6.Notwithstanding the foregoing, the Lessee is exclusively
responsible for the safety of its employees.
4. Security Services
▇.▇.▇▇▇▇▇▇▇▇ measures include all measures to ensure the authorized
entrance and use of the building.
Security services include following services:
a) Guard service
b) Access system
c) Controls
4.2. Such security services are provided by the Lessor.
4.3.The Lessee must strictly follow such measures. He has no competence
to introduce new measures. For the use of the badges reference is
made to Section 8.3 of the Lease Agreement.
4.4.The Lessee agrees that his employees will continue at an
appropriate level to participate in the Lessor's fire-brigade and
First Aid organization as long as they are on site.
4.5.The Lessor's contact person for security services is ▇▇▇▇
▇▇▇▇▇▇▇▇▇. The Lessee's contact person is ▇▇▇▇ ▇▇▇▇▇▇.
5. Receiving Services
5.1.The Lessor will provide for the acceptance of goods which are not
delivered by postal service.
5.2.The Lessee shall notify to the Lessor of deliveries within 24 hours
in advance.
5.3.Except for chemicals and equipments/installations, the Lessor does
not control the delivered merchandise.
5.4.The Lessor's contact person for receiving service is ▇▇▇▇ ▇▇▇▇▇▇.
The Lessee's contact person is ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇.
6. Reception Services
6.1.The Lessee may use within regular working hours all the services of
the switchboard.
6.2.Separate phone and fax numbers will be assigned and the costs will
be charged to the Lessee. However, eight telephone lines are
included.
6.3.The Switchboard is responsible for the reception of customers.
▇.▇.▇▇▇▇▇▇▇ person for the reception services is ▇▇▇▇▇ ▇▇▇▇▇. The
Lessee's contact person is ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇.
7. Remuneration
7.1. No remuneration for the Mandatory Services is due by the
Lessee until the 30. June 1998.
7.2. Unless the space occupied by the Lessee exceeds the rented
space of 68.1 meters square, during the period from 1. July 1998
until 31. December 1998 no remuneration for the Mandatory Services
will be due for this period. Otherwise, if additional space is
occupied by the Lessee the charge for Mandatory Services will be
SFr. 36'000.-- per month.
7.3. As of 1. January 1999 the Lessee must pay SFr. 36'000.-- per
month for the provision of Mandatory Services, independent of
the leased surface.
Optional Services Category 1
1. Model Shop & Electronic Services
1.1. Under model shop & electronic services the Parties includes
all the labor that is related to designing, developing,
fabricating and maintaining, mechanical and electronic parts,
tools, assemblies and software which may directly support the
development of future products as well as the production line.
Therefore the Lessee's equipment may be maintained, repaired and
improved. Whereas the electronic services concern measures which
deal exclusively with electronic matters, be it hardware or
software, the model shop concern all other work to the Lessee's
equipment.
Model shop & electronic services include :
a)Direct involvement in development of new test- and fabrication
equipment
b)Design and fabrication of tools and assemblies not available
on the open market
c) Laboratory Automation
d) Consulting
1.2. The Lessor shall carry out the above mentioned services on
written request and specification of the Lessee.
The Lessor, however, may refuse the performance in its
discretion. The interests of the Lessor's business have
priority.
The deadlines shall be determined in a separate written
agreement.
1.3. For the model shop services the Lessee shall pay a hourly
compensation of SFr. 159.--
For the electronic services the Lessee shall pay a hourly
compensation of SFr. 161.--
The prices do not include costs and expenses for the used
material. These will be charged to the Lessee.
1.4. The Lessor's contact persons for model shop & electronic
services is ▇▇▇ ▇▇▇▇▇. The Lessee's contact person is ▇▇▇▇▇
▇▇▇▇▇▇▇▇.
2. Information System (I/S)
2.1. Information system services are divided into the explicit or
dedicated services and implicit services.
Explicit services are those where an I/S employee directly works
for the Lessee, e.g. when installing or repairing a workstation,
when building up a special LAN for the Lessee, consulting hours,
etc.
Implicit are those services which are part of the general I/S
infrastructure, e.g. automatic backup, the Notes infrastructure,
the LAN operation, data space on file servers, printing
services, etc. This includes for example a proportional amount
of depreciation for the servers, public printers, etc. but not
for the Lessee-owned workstation, printers, etc.
2.2 Lessor will provide only the existing cables at the Leased
Premises as of 7. March, 1997 for the term of the Lease Agreement
at no charge to assist Lessee in implementing its own network
infrastructure.
2.3. Lessor will provide the following implicit services on an
interim basis not to exceed 6 months after the Closing Date of the
Purchase Agreement at no additional charge: LotusNotes Mail and
Lessee specific databases and services such as user identifiable
mail folders, electronic mail received, the ability to send
Internet Mail, the Quality Review Board database, Addressbook
database, and personal databases specific to Lessee's operation.
2.4. For one month following the Closing Date of the Purchase
Agreement, Lessor will provide Lessee employees with access to the
AIX and/or VM environments. After such one month period, access
will be terminated. However, for six months following the Closing
Date of the Purchase Agreement, 3 user id's (CHA, LBR, and MAC)
will have access to the AIX and/or VM environments. Such access
will then terminate after six months. This access will be provided
at no additional charge.
2.5. Lessor will provide, at no additional charge, access to
network printers, plotters, scanners and to the Internet gateway
for 6 months after the Closing Date of the Purchase Agreement.
2.6. Lessor will provide for to Lessee continuation of the
automatic back-up process for personal data. Lessor will provide
this process to Lessee for 6 months after the Closing Date of the
Purchase Agreement at no additional charge. However,
notwithstanding anything contrary contained in this Agreement,
Lessor will not be liable nor does it guarantee the validity or
accuracy or operation of the back-up process. This process is
provided as-is.
2.7. Lessor will provide access for the Cadence application and a
plotter that can be used for this application for six months
following the Closing Date of the Purchase Agreement. After such
six month period, such access will be charged as determined by
Lessor. Such access will terminate on 31. December, 1997.
2.8. Except for sections 2.2, 2.3, 2.4, 2.5, 2.6 and 2.7 the Lessor
shall carry out the above mentioned explicit or implicit
services on written request and specification of the Lessee.
The Lessor, however, may refuse the performance thereof any time
the competent staff has not free capacity. The interests of the
Lessor's business have priority.
The deadlines shall be determined in a separate written
agreement.
2.9. Explicit services will be charged with an hourly rate of SFr.
195.--. The charges for implicit services will be defined when
requested and accepted.
The prices do not include the costs of material and/or equipment
incurred by the Lessor. These will be charged to the Lessee.
2.10. The Lessee must comply with all applicable Information Assets
Security Rules of the Lessor which will be supplied by the
Lessor upon first request of the Lessee.
2.11. The Lessor's contact person for the information services is
▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇. The Lessee's contact person is ▇▇ ▇▇▇▇▇▇▇▇▇.
3. Shared Tools and Equipment
3.1. The FIB, RIN and TEM machines will remain at the Lessor's
location. The Lessee may use these two tools as long as he
occupies the leased premises.
3.2. The Lessee may use the tools hereinabove upon availability and
subject to Lessor's priority. However, the maximum usage right
of the Lessee for the FIB is 40% of the average usage per
quarter starting on the Closing Date of the Purchase Agreement.
The maximum usage right of the Lessee for the TEM is 50% of the
average usage per quarter starting on the Closing Date of the
Purchase Agreement. The maximum usage right of the Lessee for
the RIN is 50% of the average usage per quarter starting on the
Closing Date of the Purchase Agreement.
3.3. There will not be an additional charge to the Lessee for this
tool usage until after 31. December 1998.
3.4. The equipment located in room L213 (as referenced in Schedule
2 of the Lease Agreement) may be used with priority by Lessee
during the lease term with no additional charge from Lessor.
3.5. The SEM located in room H136 (as referenced in Schedule 1 of
the Lease Agreement) may be used with priority by Lessee during
the lease term with no additional charge to Lessee until a new
SEM is installed by Lessee. After such installation, Lessee may
also use the SEM but only in the case of an emergency and with
the approval and subject to the priority of Lessor.
3.6. The CVD system in room H207 (as referenced in Schedule 2 of
the Lease Agreement) may be used with priority by the Lessee
during the lease term with no additional charge, until a new CVD
system is installed but no longer than 31. May 1997.
3.7. The Photoluminous for MBE in room C253 (as referenced in
Schedule 1 of the Lease Agreement) may be used with priority by
the Lessee during the lease term with no additional charge.
However, Lessor reserves the right to use such tool for a
minimum period of 2 hours per day during the lease term.
3.8. The Packaging Equipment in room H161 (as referenced in
Schedule 2 of the Lease Agreement) may be used with priority by
the Lessee during the lease with no additional charge. However,
Lessor reserves the right to use such equipment for up to 50% of
the average usage per quarters starting on the Closing Date of
the Purchase Agreement.
3.9. The Lessor will give the Lessee first priority to purchase the
shared tools and equipment before offering them to a third party
("Vorkaufsrecht").
4. Cafeteria Services
4.1. Lessor will provide cafeteria services to all the employees of
the Lessee to the same extent that it does for its own
employees. The additional charge to the Lessee for the cafeteria
services is SFr. 10'000.-- per month until 31. December 1997.
The Lessor will provide for cafeteria services after 31.
December 1997 at a charge to be agreed upon by Lessor and
Lessee.
4.2. The Lessor will charge separately for visitors, coffee or
other special services.
5. Library, Self-Service Model Shop, Stockroom, Mail Distribution, Copiers
Scanners Printers
5.1. The Lessor will provide the above referenced services to the
Lessee at no additional charge until 31. March 1997.
5.2. Notwithstanding anything to the contrary in the Services
Agreement such services will be charged to the Lessee after 31.
March 1997.
5.3. The Lessor will provide a quote of charges before 25. March
1997 to the Lessee for such services beyond 31. March 1997.
Optional Services Category 2
With due regard of the availability of staff and the Lessee's
business interests, the Lessor may perform services such as:
1. Finance
Accounting; Controlling; Reporting; Payroll.
2. Purchasing
Purchasing of equipment and material; Mail distribution.
3. Publication/Office services
Graphics Support; Word Pro - Applications; Conference Preparation.
Ancillary costs
Following main expenses are entailed in the rent of the Leased Premises A,
B, C:
Electricity
Water
Sewage-charges
Heating, Fuel
Waste removal and paper recycling
Guard Services
Building maintenance (excludes costs relating to interior decoration)
Maintenance and repair of building installations
Existing infrastructure (excluding toll charges) of telephone PBX lines.
IBM Zurich-Site Safety Manual
(Note: IBM Zurich-Site Safety Manual has been delivered to the Lessee).
Laboratory Real Estate Lease
(the "Lease Agreement")
made and entered
between
International Business Machines Corporation, Zurich Research Laboratory,
▇▇▇▇▇▇▇▇▇▇▇▇▇ ▇, ▇▇- ▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇,
(hereinafter referred to as the "Lessor")
on the one hand
and
Uniphase Laser Enterprise AG, Zug,
▇/▇ ▇▇▇▇▇▇▇▇ ▇▇▇ ▇▇▇▇ ▇▇, ▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇, ▇▇▇▇ ▇▇▇
(hereinafter referred to as the "Lessee")
on the other hand
____________________
Whereas, the Lessor wishes to sell to Uniphase Corporation and the
Lessee, and Uniphase Corporation and the Lessee wishes to purchase
from the Lessor the Transferred Assets as defined in the Purchase
Agreement (as defined below)
Whereas, Uniphase Corporation and the Lessee and the Lessor for
this purpose have entered into purchase agreement dated of even
date herewith (hereinafter referred to as the "Purchase
Agreement"), and
Whereas, the Lessor wishes during a transitional period following
the completion of the Purchase Agreement to lease to the Lessee,
and the Lessee wishes to rent from the Lessor the Leased Premises
(as defined below), subject to the terms and conditions hereinafter
set forth, in order to allow the immediate start of the production
of certain components,
Whereas, the Lessor and the Lessee intend, during the transitional
period following the completion of the Purchase Agreement to
receive and provide certain basic support and administrative
services and for this purpose shall enter into a services agreement
(hereinafter referred to as "Services Agreement");
Now, therefore, in consideration of the premises set forth above
and the respective covenants, agreements, hereinafter set forth,
Lessor and Lessee (collectively the "Parties") hereby agree as
follow
1. Leased Premises
The Lessor leases to the Lessee in the building located at
▇▇▇▇▇▇▇▇▇▇▇▇▇ ▇, ▇▇-▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇ the following premises
(collectively the "Leased Premises"):
a) 340.0 meters squared offices and 143.9 meters squared dry
laboratories and 30.0 meters squared (such premises being
hereinafter referred to as "Premises A") further
described in Schedule 1 and 4.
b) 68.8 meters squared offices, 77.4 meters squared cleanroom, 35.3
meters squared dry laboratories and 380.3 meters squared wet
laboratories (such premises being hereinafter referred to as
"Premises B") further described in Schedule 2 and 4.
c) 15.1 meters squared offices and 53.0 meters squared wet
laboratories (such premises being hereinafter referred to as
"Premises C") further described in Schedule 3 and 4.
The joint use of public spaces such as parking, corridors,
cloakrooms, reception area, rooms (as referenced in the Safety
Manual in Schedule 6) and the joint use of the conference rooms are
included in the Lease Agreement. The Lessee can use conference
rooms including the video conferencing equipment subject to
availability.
2. Use of the Leased Premises
The Leased Premises shall be used for the production of diode-
lasers in the same manner as they have been used by Lessor's Laser
Enterprise Department.
3. Term of the lease
3.1.The term of the lease for the Premises A, B, C begins on the
Closing Date of the Purchase Agreement.
3.2.The lease of the Premises A shall end on ( * )
without notice of termination (hereinafter referred to as
"Fixed Lease Period A").
3.3.The lease of the Premises B shall end on ( * ) without
notice of termination (hereinafter referred to as "Fixed Lease
Period B").
3.4.The lease of the Premises C shall end on ( * )
without notice of termination (hereinafter referred to as
"Fixed Lease Period C").
* - Information redacted and filed separately with the SEC.
4. Extension of the lease periods
4.1. The Lessee has the right to unilaterally extend the lease term
with regard to the Premises A until the ( * ).
The notification of the extension shall be made by written
notice by the Lessee to the Lessor three months prior to the
end of the Fixed Lease Period A.
4.2. The Lessee has the right to unilaterally extend the lease term
with regard to the Premises B until the ( * ).
The notification of the extension shall be made by written
notice by the Lessee to the Lessor three months prior to the
end of the Fixed Lease Period B.
4.3.The Lessee has the right to unilaterally extend the lease term
with regard to Premises C until the ( * ) of the wet
laboratories as mentioned in Schedule 2. The Lessee also has
the right to swap one of the wet laboratories in lieu of L 261
of Schedule 3.
The notification of the extension shall be made by written
notice of the Lessee to the Lessor three months prior to the
end of Fixed Lease Period C.
4.4.The Lessee is aware that the Lease Agreement will be concluded
for the limited Fixed Leased Periods A, B, C and that he may
only request the extensions within the periods as described
hereinabove. Any further extension of the lease relationship
shall not be agreed because of the urgent need for the Lessor's
own use which involves a restructuring of the Leased Premises,
scheduled to start at the latest on ( * ) for the
Premises A, on ( * ) for the Premises B and on (
* ) for Premises C. Therefore, the Lease Agreement as
described hereinabove is concluded expressly for a limited
period of time according to Article 272a (1)(d) of the Swiss
Code of Obligations.
4.5.The Lessee is aware that it requires a considerable effort to
find and equip suitable facilities to carry on his business
within a reasonable period of time and therefore before Closing
Date the Lessor has indicated him the opportunity for renting
other business premises in the locality of Binz in Zurich in
order for Lessee to be able to move to equivalent premises
within the agreed to time.
* - Information redacted and filed separately with the SEC.
5. Rent
5.1.For the lease of Premises A for the Fixed Lease Period A, of
Premises B for the Fixed Lease Period B and of Premises C for
the Fixed Lease Period C no rent is due by Lessor. The payment
of the remuneration for the use of the Leased Premises is
already included in the purchase price of the Transferred
Assets according to Section 1.3. of the Purchase Agreement.
5.2.For the extension of the lease term for the Premises A, the
Lessee shall pay a monthly rent of SFr. 90.-- per meters squared
for the use of the offices and of SFr. 145.-- per meters squared
for the use of the dry laboratories.
5.3.For the extension of the lease term for the Premises B, the
Lessee shall pay a monthly rent of SFr. 90.-- per meter squared
for the use of the offices, of SFr. 345.-- per meter squared
for the use of the cleanroom and of SFr. 210.-- per meters
squared for the use of the wet laboratories.
5.4.For the extension of the lease term for the Premises C, the
Lessee shall pay a monthly rent of SFr. 135.-- per meter squared
for the use of the offices and SFr. 320.-- meter squared for
the use of the wet laboratories.
5.5.The rent for the extensions of the lease term of Premises B and
C is based on the index of consumers' prices at the Closing
Date of the Purchase Agreement. If for the 1. July 1998 the
index of consumers' prices (base May 1993 = 100 points)
increases of at least 5 points, the Lessor may once, at the
commencement date of each extension period increase the agreed
rents according to the following formula:
Increase in %:
new index - index at the time of conclusion of the contract
x 100
--------------------------------------------------
index at the time of conclusion of the
contract
5.6.The agreed initial rents cannot be decreased.
5.7.The Lessee shall pay the rents at the end of each month for the
following month to the bank account as designated by the
Lessor.
6. Ancillary costs
6.1.Under ancillary costs of this Lease Agreement the Parties
understand the remuneration for performances by the Lessor
which are connected with the use of the Leased Premises A, B, C
and with the use of the common spaces further described in
Schedule 5.
▇.▇.▇▇ ancillary costs are due by the Lessee. These costs are
included in the purchase price as entailed in the Purchase
Agreement for the fixed periods A, B, C and in the rents for
the extensions of the Lease Agreement.
6.3.Telephone and fax expenses are not included in the ancillary
costs and will be charged separately to the Lessee.
7. Transfer of the Leased Premises
7.1.The transfer of the Leased Premises provided for in this
agreement shall take place on the Closing Date of the Purchase
Agreement.
The Lessor transfers the Leased Premises "AS IS". The Leased
Premises are deemed to be in a suitable condition for the use
as listed in Section 2 of this agreement. The Lessor represents
that at the Closing Date the Leased Premises comply with all
applicable laws including without limitation, environmental
protection laws, construction laws, the fire police law and the
requirements of the Labor Statute.
7.2.The Parties renounce to draw up a transfer protocol.
7.3.On the day of the transfer the Lessor will exchange the old
badges delivered to the transferred employees for the new ones
in order to allow the entering in the building and in the
Leased Premises to the Lessee. The replacement of lost or
stolen badges during the lease are part of the Mandatory
Services of the Lessor and are in his exclusive competence. The
Lessee shall immediately inform the Lessor of any loss. The
Lessee must pay the costs of the replacement. The procurement
of additional badges is in the exclusive competence of the
Lessor. The Lessee shall inform the Lessor of any need hereof.
7.4.The Lessor will instruct the Lessee about the security system
of the building.
7.5The Lessee confirms that he has received a copy of the 'IBM
Zurich-Site Safety Manual', which is attached to this Lease
Agreement as Schedule 6.
8. Duties of the Lessee
8.1.The Lessee shall use the Leased Premises with due care. He
shall use them only for the purposes mentioned under Section 2.
8.2.The Lessee shall give due consideration for other occupants and
he shall not impair in any way the Lessor's business and
research activities.
8.3.Except for the entrance of the Leased Premises and the common
spaces, the Lessee shall not have access to the other parts of
the building, specifically the research laboratories of the
Lessor except as provided for under the Services Agreement or
elsewhere under this Lease Agreement.
8.4.The Lessee shall observe all the security, safety and general
rules of the house regulations (hereinafter referred to as
"Internal Rules") to the extent they do not conflict with the
Lease Agreement. The Lessee is aware that the Internal Rules
are subject to revision to the extent they do not conflict with
the Lease Agreement by the Lessor and that he has no right to
request any replacement thereof.
8.5.The Lessee shall manage his business in accordance with the
Swiss mandatory public laws, and in particular to obey the
applicable rules of Swiss environmental protection law, of the
fire police law, the requirements of the Accident Insurance
Statute and all the related standards and the and the
requirements of the Labor Statute
8.6.The Lessee is not allowed to carry out any building
modification to the Leased Premises. Such modifications need
the written consent of the Lessor which consent shall not be
unreasonably delayed or refused.
8.7.All the Mandatory Services as defined in Section 2 and Schedule
1 of the Services Agreement are exclusively performed by the
Lessor. While occupying the Leased Premises the Lessee must
make use of the Mandatory Services as provided by the Lessor.
The Lessor is obliged to provide such Mandatory Services. The
Lessee shall consult with the Lessor (the competent staff)
about any necessity and problem. The Lessee shall immediately
report all defects to the contact persons as further mentioned
in Schedule 1 of the Services Agreement.
8.8.The Lessee shall permit the Lessor to enter the Leased Premises
to perform the Mandatory and Optional Services according to
Sections 2 and 3 and Schedules 1, 2 and 3 of the Services
Agreement, further, if necessary, for the maintenance, to
remedy defects and to repair or avoid damages. Except for the
performance of the Mandatory and Optional Services and for
emergency, the Lessee shall be notified ahead of time to the
extent possible.
8.9.Notwithstanding anything to the contrary set forth in the Lease
Agreement, if repairs and other urgent action are necessary,
the Lessee shall inform the Lessor and shall undertake all
reasonable precautions. The Lessee shall be liable for failure
to notify the Lessor.
8.10.The Lessee must remedy, at his own expenses, defects for which
the Lessor is not responsible according to Section 10.1 of the
Lease Agreement and which may be cured by standard cleaning, or
repairs and replacements necessary for ordinary maintenance.
The Lessee is not entitled to call upon external third parties
for the purpose of carrying out the obligation hereunder
without the prior written consent of the Lessor which consent
shall not be unreasonably delayed or refused.
8.11.Despite a ten day prior written notice period to cure, if the
Lessee continues to violate his duties according Section 9.1 to
9.6. in a manner such that the continuation of the Lease
Agreement may no longer be expected from the Lessor, the Lessor
may give notice of termination of the Lease Agreement with
effect after a period of 30 days as per the end of a month. The
Lessor may, however, give notice of termination of the
agreement with immediate effect if the Lessee has intentionally
caused serious damage to the Lessor's building.
9. Duties of the Lessor
9.1.The Lessor is obliged to maintain the Leased Premises in
compliance with all applicable laws, in a suitable condition
for the contractual use, to remedy the material defects and to
perform the Mandatory Services at any time they are necessary
within the periods further described in Section 6.1. of the
Services Agreement.
9.2.The Lessor shall inform the Lessee of any change of the
Internal Rules.
9.3.The Lessor shall not have access to the Leased Premises, except
for laboratories shared with Science and Technology as
mentioned in Schedule 2 and except as provided for under the
Services Agreement or elsewhere under this Lease Agreement.
10. Liability insurance
On 1. April 1997 the Lessee shall deliver a copy of the signed
professional risk indemnity insurance policy which shall cover at
least US$ 5'000'000.--.
11. Sublease
According to Article 262 (2)(c) of the Swiss Code of Obligations,
the sublease of the premises is not allowed because it would cause
significant disadvantages for the Lessor. Empty spaces will be
taken over by the Lessor.
12. Return of the Leased Premises
12.1.The Lessee must return the Premises in the same condition as
taken over with the reservation of the normal wear and tear
which results from the use provided for in this agreement under
Section 2.
12.2.The Lessee shall remove all the Transferred Assets. The
separation and removal shall conform to the rules mentioned in
Section 9 hereinbefore. The Lessee will not be liable for
incidental damages which arise as a natural consequence from
the separation and removal of the Transferred Assets. The
Lessee will bear the costs for the separation and removal. The
Lessor will cooperate with the Lessee in connection with such
separation and removal under a separate agreement.
12.3.The waste caused by the removal of the Transferred Assets will
be disposed of by Lessor and will be charged to the Lessee.
12.4.The Lessee shall return all the badges, keys and all the
documentation which concerns the Leased Premises.
12.5.The Lessee represents that at the date of return of the Leased
Premises, the Leased Premises will comply with all applicable
laws including without limitation environmental protection
laws, construction laws the file police law and the
requirements of the labor statute.
13. Applicable law / Place of Jurisdiction
13.1.This agreement shall in all respect be interpreted and
construed in accordance with and governed by the laws of
Switzerland, and shall be subject to performance in the country
of Switzerland.
13.2.Where no special clause is entailed in this agreement,
Articles 253 ff. of the Swiss Code of Obligations shall apply.
The compulsory statutory liability rules are applicable to this
agreement.
13.3.The court of jurisdiction is Horgen.
13.4.This Agreement supersedes any and all previous agreements
whether written or oral with respect to the subject matter. And
may not be amended unless in writing.
____________________
Place, date Place, date
3-10-97 3-10-97
The Lessor The Lessee
\s\ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇ \s\ ▇▇▇▇▇ ▇. ▇▇▇▇▇▇
List of the Leased Premises A
C-Building
C 233 C 219 C 353
C 241 C 349 C 355
C 251 C 350 ▇ ▇▇▇
▇ ▇▇▇ ▇ ▇▇▇ ▇ ▇▇▇
▇▇▇ ▇▇▇▇▇▇▇▇▇
▇ 136* ▇ ▇▇▇ ▇ ▇▇▇
▇ ▇▇▇ ▇ ▇▇▇ ▇ ▇▇▇
▇ 208 ▇ ▇▇▇ ▇ ▇▇▇
▇ ▇▇▇ ▇ ▇▇▇ ▇ ▇▇▇
▇ 226 Z 222 P 285
H 232 Z 226 ▇ ▇▇▇
▇ ▇▇▇ ▇ ▇▇▇ ▇ ▇▇▇
▇ 240 M 305
* = Labs shared with Science and Technology
List of the Leased Premises ▇
▇ ▇▇▇▇▇▇▇▇
▇ ▇▇▇
▇▇▇ ▇▇▇▇▇▇▇▇▇
▇ 122* L 130 Z 245
H 132* M 100 P 266
H 155* Z 113 ▇ ▇▇▇
▇ ▇▇▇ ▇ ▇▇▇ ▇ ▇▇▇
▇ 207* Z 123 P 278
H 221 Z 207* P 282
H 249 Z 213 P 286
Z 239* P 290
* = Labs shared with Science and Technology
List of the Leased Premises C
Old Buildings
L 261 Z 218
Exhibit E: Pension Matters
Final
Paragraph 1. The Buyer's Plan.
a. The Buyer agrees as promptly as is practicable after the
Closing Date but in any event within 90 days thereafter to (i) establish a
new defined occupational pension plan or amend an existing plan (the
"Buyer's Plan") to provide Employees with pension benefits that are at
least substantially comparable with the benefits that are provided to
Employees under the Seller's two applicable pension benefit plans as of the
Closing Date (the "Seller's Plans"), (ii) provide for the participation of
Employees therein as of the Closing Date, and (iii) provide that in
applying any length of service requirement for participation or vesting,
and in determining an Employee's benefits under the Buyer's Plan, such
Employee shall be credited with prior service accruing from and after such
Employee's "Service Reference Date" as shown in the records of the Seller,
according to Seller's rules for service credit, and with such Employee's
eligible compensation under the Seller's Plan during that period. The
Seller shall provide the Buyer with true, correct and complete copies of
all documents, amendments, instruments, employee communications and records
related to Seller's Plans and required to establish and administer the
Buyer's Plan with respect to each Employee's pension benefits, eligible
compensation and service prior to the Closing Date.
b. The Buyer further agrees that the Buyer's Plan shall
contain an irrevocable provision prohibiting the Buyer or any Affiliate of
or successor to the Buyer from receiving a reversion of all or any portion
of the Transferred Pension Assets. The Buyer's Plan shall also provide
that upon the termination of Buyer's Plan and after payment of all
liabilities under Buyer's Plan, the plan trustee or its successor or
transferee shall transfer any remaining Transferred Pension Assets to a
separate trust established by the Buyer for the exclusive benefit of the
Employees provided that such trust shall not operate in a manner which
discriminates in favor of any highly paid Employees.
Paragraph 2. Calculation of Transferred Assets.
a. Seller's Actuary is ▇.▇▇▇▇-▇▇▇▇▇▇▇▇. Seller's Actuary shall
determine the proposed funds to be transferred (herein "Transferred Pension
Assets"), based on the assumptions used by the Seller's Actuary according
to the 1995 annual review of Seller's Plans reported to and approved by the
official supervisory board ("Amt fur berufliche Vorsorge"), when
calculating the assets to cover the liability under Seller's Plans.
b. The Seller will entitle Seller's "Vorsorgefonds der IBM
Corporation, Forschungslaboratorium Zurich" to transfer the amount of
Swiss Francs 1,271,699 which are part of the Seller's contribution reserve
to the Buyer's Plan. The parties agree that this amount will be allocated
to the individual pension plan accounts in the Buyer's Plan of the eleven
(11) Employees who qualify for the Seller's Personalfursorgestiftung der
IBM Corporation, Forschungslaboratorium Zurich according to the partition
amounts set forth in Attachment 1.
c. The Parties agree that the six (6) Employees listed in
Attachment 2 (the "Six Employees") remain with Seller's Plans for 180 days
after the Closing Date (the "180 Day Period"). The Seller has the
obligation to, if necessary, amend or cause to be amended the rules and
regulations of Seller's Plans in order to allow the Six Employees to remain
with Seller's Plans for the 180 Day Period. The Buyer is responsible for
the payment of normal compensation to the Six Employees after the Closing
Date as long as they are employed with Buyer. The Buyer further agrees to
pay the normal pension fund premiums as long as such Employees are employed
with Buyer until the effective date of retirement. If at any time during
the 180 Day Period any of the Six Employees applies for early retirement,
the appropriate application shall be made in writing to the
"Personalvorsorgestiftung der IBM Corporation, Forschungslaboratorium
Zurich". Such retiring Employees (the "Retiring Employees") will remain
with Seller's Plans. Seller shall, or shall cause any of Seller's Plans to
pay, or cause to be paid, the pension payments as set forth in the rules
and regulations of Seller's Plans with respect to the Retiring Employees.
If certain of the Six Employees do not apply for early retirement within
180 days after the Closing Date (the "Non-Retiring Employees"), they will
be transferred to the Buyer's Plan. The Seller will transfer or cause to be
transferred 180 days after the Closing Date to the Buyer's Plan the amount
of Swiss Francs identified in Attachment 3 for each Non-Retiring Employee.
That amount will be part of the Seller's Plans and part of Seller's
contribution reserve. The parties agree that any such amount will be
allocated for the exclusive benefit of the Non-Retiring Employees to the
individual pension plan accounts in the Buyer's Plan for the respective Non-
Retiring Employee. Notwithstanding anything to the contrary, no pension
fund amounts for the Six Employees will be transferred to the Buyer, other
than as set forth in this section c. and section g.
d. The Seller will entitle the Seller's "Vorsorgefonds der IBM
Corporation, Forschungslaboratorium Zurich" to transfer in addition to the
amount mentioned in section (b.) the amount of Swiss Francs 328,301, which
is part of the Seller's contribution reserve to the Buyer's pension plan.
e. Buyer and Seller agree that no other obligations between the
parties will result as a consequence of the partial liquidation of the
Seller's Plans and contribution reserves and will present and support this
agreement to the official supervisory board.
f. At the Closing a Board resolution of the "Vorsorgefonds der
IBM Corporation, Forschungslaboratorium, Zurich" will be provided to the
Buyer which states that the obligations mentioned in subparagraphs b,c and
d of this Exhibit E will be implemented according to their terms.
g. The Seller agrees that, ultimately, the Seller will transfer
to the Buyer's Plan the amounts required pursuant to this Exhibit E, if any
circumstance results in the Seller's Plans fund failing to transfer such
amounts, provided however that this payment from Seller be in compliance
with Swiss Law.
Paragraph 3. Actions to Effect Pension Assets Transfer. The Seller
and the Buyer shall promptly, after the Closing Date, effect the transfer
of the Transferred Pension Assets to the Buyer's Plan as contemplated by
this Exhibit E, and in compliance with applicable Swiss law. The future
Swiss Pension Transfer Agreement shall govern such matters. Such transfer
shall be in cash or, to the extent mutually agreed to by the Seller and the
Buyer, in kind.
Paragraph 4. Verification by the Buyer. The Buyer shall have the right
to appoint an independent actuary (the "Buyer's Actuary") for the purposes
of verifying the free portability calculation of the Transferred Pension
Assets, referenced in paragraph 2.a. herein, by the Seller's Actuary
(excluding the amounts agreed upon by Buyer and Seller set forth in
attachments 1 and 3 of this Exhibit E). Such amount as certified by the
Seller's Actuary shall be conclusive and binding on the Seller and the
Buyer unless, within 60 days after the delivery of such certification by
the Seller's Actuary to the Buyer's Actuary (during which time such
supporting factual information as the Buyer's Actuary may reasonably
request shall be provided by the Seller's Actuary), the Buyer's Actuary
shall notify the Seller of its disagreement with such amount. Subject to
the Swiss Pension Transfer Agreement and the procedures and terms and
conditions therein, if it exists at that time, if any such disagreement is
not resolved to the satisfaction of the Seller and the Buyer within 30 days
of the Seller's receipt of such notification (or within such longer period
as the Seller and Buyer shall mutually agree), either the Seller or the
Buyer may elect to have the calculation submitted for arbitration by a
third independent actuary mutually acceptable to the Seller and the Buyer,
who shall be entitled to the privileges and immunities of an arbitrator,
and whose determination shall be conclusive, final and binding and have the
force and effect of an arbitrable award, provided, however, that none of
the Seller, the Buyer, the Seller's Plans or the Buyer's Plan shall be
bound by any decision of such arbitrator that would cause such party to
violate law. The arbitrator will apply the pension provisions set forth in
the Purchase Agreement and this Exhibit E for any matters in dispute
hereunder. The expenses of the Seller's Actuary shall be borne by the
Seller, the expenses of the Buyer's Actuary shall be borne by the Buyer and
the expenses of any third actuary shall be borne equally by the Seller and
the Buyer.
ATTACHMENT 1 TO EXHIBIT E
Partition amounts of Seller's Contribution Reserve
List of employees and a proportional amount of contribution to the
Pension Plan as of the close date.
ATTACHMENT 2 TO EXHIBIT E
Employees eligible for Early Retirement
List of Employees Names and related birthdays.
Attachment 3 to Exhibit E
Possible partition amount of Seller's Plan and contribution reserve.
List of Employees and contributed reserves as of the close date.