DELAWARE | 001-11174 | 06-1340090 | ||
(State or other jurisdiction of | (Commission file number) | (I.R.S. employer | ||
incorporation or organization) | identification number) |
Exhibit 10.1 | Shares Purchase Agreement, dated as of August 7, 2015, by and between MRV Communications, Inc., as Seller, and Maticmind S.p.A., as Purchaser. |
Exhibit 99.1 | Press Release dated August 10, 2015, announcing execution of the Purchase Agreement. |
Date: August 10, 2015 | ||
MRV COMMUNICATIONS, INC. | ||
By: | /s/ Stephen G. Krulik | |
Stephen G. Krulik | ||
Chief Financial Officer |
1. DEFINITIONS | 4 |
2. PURCHASE AND SALE; CLOSING | 11 |
3. REPRESENTATIONS AND WARRANTIES OF THE SELLER | 16 |
4. WARRANTIES OF PURCHASER | 24 |
5. COVENANTS OF SELLER | 25 |
6. COVENANTS OF PURCHASER | 32 |
7. ADDITIONAL COVENANTS OF SELLER AND PURCHASER | 34 |
8. CONDITIONS TO CLOSING | 34 |
9. INDEMNIFICATION | 36 |
10. TERMINATION | 39 |
11. MISCELLANEOUS AND GENERAL | 40 |
1. | Definitions |
1.1 | In this Agreement, unless the context otherwise requires, the following terms shall have the following respective meanings: |
Accounting Principles | means the rules of Italian Law applicable to the preparation of financial statements, as integrated by, interpreted and applied in accordance with the accounting principles issued by the Commissione Nazionale dei Dottori Commercialisti e dei Ragionieri and by the OIC (Organismo Italiano di Contabilità), as consistently applied with the past practice by the Company. |
Affiliate | means, with respect to any Person, any other Person who or that directly or indirectly, through one or more intermediaries, controls, is controlled by, or is under common control with, such Person. The term “control” (including the terms “controlled by” and “under common control with”) means the possession, directly or indirectly, of the power to direct or cause the direction of the management and policies of a Person, whether through the ownership of voting securities, by Contract or otherwise. |
Agreement | has the meaning set forth in the Introduction. |
Annual Financial Statement | has the meaning set forth in Section 3.2.7. |
Business Day | means a day on which banks in Italy and the United States generally have their offices open for business (not including Saturdays and Sundays). |
Business Field | means the provision of stand-alone network integration services in the Italian market. |
Civil Code | means the Italian Civil Code, approved by Royal Decree No. 262 of March 16, 1942 as amended from time to time. |
Closing | has the meaning set forth in Section 2.5.1. |
Closing Date | means (i) the third Business Day after the day on which the last of the Conditions Precedent has been satisfied or waived, as applicable (other than those conditions that by their terms are to be satisfied at Closing, but subject to the satisfaction or waiver of such conditions at Closing), or (ii) such other date as the Parties may agree in writing. |
Closing Net Financial Position | means the amount of Net Financial Position of the Company as of the close of business on the Closing Date. |
Closing Net Financial Position Statement | has the meaning set forth in Section 2.6.2.1. |
Company | has the meaning set forth in the Recitals. |
Company Continuing Employee | has the meaning set forth in Section 6.3.1. |
Conditions Precedent | has the meaning set forth in Section 8.2. |
Confidentiality Agreement | has the meaning set forth in Section 5.3. |
Contract | means any agreement, contract, license, lease, commitment, arrangement or understanding, whether written or oral, including sales orders and purchase orders. |
Debt for Bonuses | means any amounts due by the Company to certain individuals, pursuant to any bonus or similar agreements, triggered by the Closing of the Transaction, including the Taxes, social security payments and social contributions in connection therewith, as shown on Schedule 1.1.A, which amounts shall be considered as debt for the purposes of calculating the Net Financial Position. |
Deed of Transfer | has the meaning set forth in Section 2.5.2.1(A). |
Disputed Amounts | has the meaning set forth in Section 2.6.3.3. |
Employees | has the meaning set forth in Section 3.2.12. |
Environmental Laws | means any and all applicable Laws concerning protection of the environment, including air, soil, subsoil and water pollution control, resource conservation and recovery, waste disposal, and toxic substance control. |
Factoring Threshold | means an amount equal to (A) 15% (fifteen percent) of the total factored accounts receivable that have not yet matured as of the Closing Date, less (B) an amount equal to any dividend, distribution or other payment by the Company to the Seller or its Affiliates during the period starting from the Signing Date and ending on the Closing Date (other than repayment of the Intercompany Note and other than payments for goods and services in the ordinary course of business). |
Final Proxy Statement | means the definitive proxy statement of the Seller to be filed with the Securities and Exchange Commission in connection with the Seller Stockholders’ Meeting. |
Governmental Entity | means any entity or body exercising executive, legislative, judicial, regulatory or administrative functions of or pertaining to any foreign, federal, state, local, or municipal government, or any international, multinational or other government, including any department, commission, board, agency, bureau, subdivision, instrumentality, official or other regulatory, administrative or judicial authority thereof, and any non-governmental regulatory body to the extent that the rules and regulations or orders of such body have the force of law. |
Indebtedness | means all obligations of the Company (i) for borrowed money, (ii) evidenced by notes, bonds, debentures or similar instruments, and (iii) for guarantees of, and other commitments to pay or otherwise cover, the obligations described in clauses (i) through (ii) above for any other Person. |
Independent Accountants | has the meaning set forth in Section 2.6.3.3. |
Intellectual Property | means all intellectual and industrial property rights including: (a) patents and registered designs; (b) unregistered rights in designs, copyright (including copyright in source code, object code and other computer software and databases) and neighbouring rights, database rights, semiconductor topography rights and rights subsisting in or in relation to confidential information or inventions; (c) registered and unregistered trademarks and service marks, and all other rights in, or goodwill attaching to, trade, business or corporate names, logos, domain names, get-up or other trading insignia; and including (insofar as any of the foregoing rights are obtained by registration), applications for registration and the right to apply for registration; all rights and forms or protection of a similar nature to any of the foregoing recognized in any country of the world. |
Intercompany Note | means the note issued by the Company to Seller in the principal amount of Euro 4,050,000 together with accrued and unpaid interest pursuant to the loan agreement between the Company and Seller dated 29 October 2010, as amended. |
Intervening Event | has the meaning set forth in Section 5.2.9. |
Key Employees | means Messrs. Giuliano Maurizi, Fabio Magi, Roberto Romoli, Fabio Raissi and Maurizio Garonna. |
Law | means any statute, law, ordinance, code, rule, regulation, decree or order of any Governmental Entity. |
Leases | has the meaning set forth in Section 3.2.11. |
Lien | means any encumbrance, pledge, mortgage, security interest, seizure, lease, charge, option, transfer restriction, privileges, lien, right of pre-emption, rights of first offer, enjoyments (diritti reali minori), easements (servitù) and usufruct or other claims or rights of any third parties restricting the right to use or dispose of an asset. |
Long Stop Date | has the meaning set forth in Section 10.1.4. |
Loss | means any and all direct damages and losses, fines, penalties, deficiencies and expenses (including interest, court costs, reasonable fees of attorneys, accountants and other experts or other reasonable expenses of litigation or other proceedings or of any claim, default or assessment). The term “Loss” shall not include any indirect, consequential, incidental or punitive damages. |
Material Adverse Effect | means any event, condition, fact, change, occurrence, effect or set of circumstances (regardless of whether foreseeable at the time of the Parties’ execution of this Agreement) that, individually or in the aggregate with any other event, fact, change, occurrence, effect or set of circumstances, (a) has had, or could reasonably be expected to have, a materially adverse effect on the business, assets, properties, liabilities, results of operations or condition (financial or otherwise) of the Company, or (b) could reasonably be expected to prevent or materially impede the performance by the Seller of its obligations hereunder; provided, however, that, with respect to clause (a), none of the following shall constitute, and none of the following shall be taken into account when determining whether there has been, a Material Adverse Effect: (i) any changes, conditions or effects in the economies or securities or financial markets in general; (ii) changes, conditions or effects that affect the industries in which the Company operates, in each case, other than to the extent such changes, conditions or effects disproportionately affect (relative to other industry participants) the Company; (iii) any change, effect or circumstance resulting from an action required or permitted by this Agreement; (iv) the effect of any changes in applicable Laws or accounting rules; (v) any change, effect or circumstance resulting from the announcement of this Agreement; or (vi) conditions caused by acts of terrorism or war (whether or not declared) or any natural or man-made disaster or acts of God. |
Material Contracts | has the meaning set forth in Section 3.2.23.1. |
Net Financial Position | Net Financial Position is calculated as the sum of: positive: (i) cash: any credit balance on bank or postal accounts, saving accounts or current counts, held by any bank and the liquid assets; (ii) the negotiable securities; (iii) positive fair value of derivative instruments; minus: (iv) financial debts, interests-bearing or not, of any kind: for example, but not limited to, including the interest bearing debts, the loans, debts vis-à-vis the banks, any other loan for deposits, any other debt in order to finance acquisitions of interests in companies, businesses and/or business branches, debts vis-à-vis banks for advances on invoices, the debt deriving from financial lease (determined by applying IAS 17) (provided that this sub-clause (iv) does not include any amounts in respect of the Company’s factoring facility, other than actual drawdowns in respect of factored accounts receivable that have not yet matured exceeding the Factoring Threshold, which excess will be considered to be debt); (v) negative fair value of derivative instrument; (vi) TFR – employees termination indemnity; (vii) outstanding (older than 60 days) and collectable interest-bearing commercial debts; (viii) overdue tax debts; and (ix) Debt for Bonuses. Attached as Schedule 1.1.B is an example calculation of the Net Financial Position, calculated as of June 30, 2015. |
Notice of Superior Proposal | has the meaning set forth in Section 5.2.4.2. |
Organizational Documents | means, with respect to a legal entity, such entity’s articles or certificate of incorporation and bylaws, or analogous documents, in each case as amended through the date hereof. |
Party | has the meaning set forth in the Introduction. |
Permit | means a license or any other document or authorization given by an authorized Governmental Entity to allow a Person to perform certain acts or business. |
Person | means any individual, corporation, partnership, limited liability company, joint venture, association, trust, organization or other entity or natural or legal person. |
Post-Closing Adjustment | has the meaning set forth in Section 2.6.2.2. |
Purchase Price | has the meaning set forth in Section 2.2. |
Purchaser | has the meaning set forth in the Introduction. |
Reference Amount | means an amount equal to Euro (3,376,000) (negative three million three hundred seventy-six thousand). |
Representations and Warranties | has the meaning set forth in Section 3.1.1. |
Representatives | has the meaning set forth in Section 5.3. |
Resolution Period | has the meaning set forth in Section 2.6.3.2. |
Review Period | has the meaning set forth in Section 2.6.3.1. |
Seller | has the meaning set forth in the Introduction. |
Seller Adverse Recommendation Change | has the meaning set forth in Section 5.2.3. |
Seller Board | means the board of directors of the Seller. |
Seller Board Recommendation | has the meaning set forth in Section 5.1. |
Seller Stockholders’ Meeting | has the meaning set forth in Section 5.1. |
Seller’s Knowledge | or any similar phrase means the actual knowledge of the Key Employees or of the directors of the Seller or the Company, or the knowledge that they would have obtained after conducting due and appropriate inquiries, including inquiries of the Employees with responsibility for the matter in question. |
Shares | has the meaning set forth in the Recitals. |
Statement of Objections | has the meaning set forth in Section 2.6.3.2. |
Stockholder Approval | has the meaning set forth in Section 5.1. |
Superior Proposal | has the meaning set forth in Section 5.2.8. |
Takeover Proposal | has the meaning set forth in Section 5.2.7. |
Taxes | means (i) all income taxes, corporate taxes, capital gains taxes, transfer taxes, social security contribution expenses, employer’s taxes, duties, sales taxes, value added taxes, withholding taxes and any other taxes and official charges and impositions of any kind which may be payable to or imposed by any Governmental Entity together with any interest, penalties, surcharges, interest or additions thereto; and (ii) any liability for the payment of any amounts of the type described in clause (i) as a result of any express or implied obligation to indemnify any other Person or as a result of any obligation under any agreement or arrangement with any other Person with respect to such amounts and including any liability for taxes of a predecessor or transferor or otherwise by operation of Law. |
Tax Returns | means all returns, reports, declarations, elections, notices, filings, forms, statements and other documents (whether in written, electronic or other form) and any amendments, schedules, attachments, supplements, appendices and exhibits thereto, which have been prepared or filed or required to be prepared or filed in respect of Taxes. |
Termination Fee | means an amount equal to Euro 250,000 (two hundred fifty thousand) or, in case of an extension of the Long Stop Date to December 31, 2015, Euro 350,000 (three hundred fifty thousand). |
Third Party Claim | has the meaning set forth in Section 9.2.1. |
Transaction | has the meaning set forth in Section 2.1. |
Undisputed Amounts | has the meaning set forth in Section 2.6.3.3. |
2. | Purchase and Sale; Closing |
2.1 | Purchase and Sale |
2.2 | Consideration |
2.1 | [Reserved.] |
2.2 | Payment of the Purchase Price |
2.3 | Closing. |
2.3.1 | The consummation of the Transaction (the “Closing”) shall take place at 10.00 am CET on the Closing Date at the offices of DLA Piper Italy, Via dei Due Macelli 66, Rome, before the notary public selected by the Purchaser. |
2.3.2 | At the Closing, the following actions shall be taken: |
2.3.2.1 | The Seller shall: |
2.3.2.2 | The Purchaser shall: |
2.3.3 | All actions and transactions constituting the Closing pursuant to Section 2.5.2 above shall be regarded as one single transaction so that, at the option of the Party having interest in the performance of the relevant specific action or transaction, no action or transaction constituting the Closing shall be deemed to have taken place if and until all other actions and transactions constituting the Closing shall have been properly performed in accordance with the provisions of this Agreement. |
2.4 | Purchase Price Adjustment. |
2.4.1 | [Reserved] |
2.4.2 | Post-Closing Adjustment. |
2.4.2.1 | Within 60 days after the Closing Date, Purchaser shall prepare and deliver to Seller a statement setting forth its calculation of Closing Net Financial Position, which statement shall contain a balance sheet of the Company as of the Closing Date (including the Debt for Bonuses), a calculation of Closing Net Financial Position (the “Closing Net Financial Position Statement”) and a certificate of the Chief Financial Officer of Purchaser that the Closing Net Financial Position Statement was prepared in accordance with the Accounting Principles and consistent with the manner of preparation of the balance sheet contained in the Annual Financial Statements. |
2.4.2.2 | The post-closing adjustment shall be an amount equal to the Closing Net Financial Position minus the Reference Amount (the “Post-Closing Adjustment”). If the Post-Closing Adjustment is a positive number, Purchaser shall pay to Seller an amount equal to the Post-Closing Adjustment. If the Post-Closing Adjustment is a negative number, Seller shall pay to Purchaser an amount equal to the Post-Closing Adjustment. |
2.4.2.3 | Notwithstanding the provisions set forth by article 1499 of the Civil Code, the Parties agrees that no interest shall accrue on the amount of the Post-Closing Adjustment up to its due date of payment. |
2.4.3 | Examination and Review |
2.4.3.1 | After receipt of the Closing Net Financial Position Statement, Seller shall have 30 (thirty) days (the “Review Period”) to review the Closing Net Financial Position Statement. During the Review Period, Seller and Seller’s accountants shall have full access to the books and records of the Company, the personnel of, and work papers prepared by, Purchaser and/or |
2.4.3.2 | On or prior to the last day of the Review Period, Seller may object to the Closing Net Financial Position Statement by delivering to Purchaser a written statement setting forth Seller's objections in reasonable detail, indicating each disputed item or amount and the basis for Seller's disagreement therewith (the “Statement of Objections”). If Seller fails to deliver the Statement of Objections before the expiration of the Review Period, the Closing Net Financial Position Statement and the Post-Closing Adjustment, as the case may be, reflected in the Closing Net Financial Position Statement shall be deemed to have been accepted by Seller. If Seller delivers the Statement of Objections before the expiration of the Review Period, Purchaser and Seller shall negotiate in good faith to resolve such objections within 30 days after the delivery of the Statement of Objections (the “Resolution Period”), and, if the same are so resolved within the Resolution Period, the Post-Closing Adjustment and the Closing Net Financial Position Statement with such changes as may have been previously agreed in writing by Purchaser and Seller, shall be final and binding. |
2.4.3.3 | If Seller and Purchaser fail to reach an agreement with respect to all of the matters set forth in the Statement of Objections before expiration of the Resolution Period, then any amounts remaining in dispute (“Disputed Amounts” and any amounts not so disputed, the “Undisputed Amounts”) shall be submitted for resolution to the office of Milan of one of the following firms to be mutually selected by the Parties: (i) KPMG or (ii) PricewaterhouseCoopers. If the Parties do not reach an agreement concerning the appointment of one of the aforementioned firms within 7 calendar days from the written request of the most diligent Party, the Parties shall meet within the following 10 calendar days before the notary public appointed for the Closing (or should him/her be unavailable or not willing to serve, before another notary public selected by the Purchaser) and the notary public will select the relevant firm by drawing the name from the 2 names under (i) and (ii) above. If the so selected firm is unable to serve each of the Purchaser and the Seller shall have the right to request to the chairman of the chartered accountants of Milan (presidente dell'ordine dei dottori commercialisti di Milano) to appoint an impartial internationally recognized firm of independent certified public accountants (the “Independent |
2.4.3.4 | Seller shall pay a portion of the fees and expenses of the Independent Accountants equal to 100% (one hundred percent) multiplied by a fraction, the numerator of which is the amount of Disputed Amounts submitted to the Independent Accountants that are resolved in favour of Purchaser (that being the difference between the Independent Accountants' determination and Seller's determination) and the denominator of which is the total amount of Disputed Amounts submitted to the Independent Accountants (that being the sum total by which Purchaser's determination and Seller's determination differ from the determination of the Independent Accountants). Purchaser shall pay that portion of the fees and expenses of the Independent Accountants that Seller is not required to pay hereunder. |
2.4.3.5 | The Independent Accountants shall make a determination as soon as practicable and in any event within 30 days (or such other time as the parties hereto shall agree in writing) after their engagement, and their resolution of the Disputed Amounts and their adjustments to the Closing Net Financial Position Statement and/or the Post-Closing Adjustment shall be conclusive and binding upon the parties hereto. |
2.4.4 | Payments of Post-Closing Adjustment |
2.4.5 | Adjustments for Tax Purposes |
3. | Representations and Warranties of the Seller |
3.1 | Representations and Warranties of the Seller |
3.1.1 | The Seller hereby makes to the Purchaser the following representations and warranties and certifies that they are true as of the date hereof and as of Closing Date, or at the other earlier date to which they specifically refer (the “Representations and Warranties”). |
3.1.2 | Each of the Representations and Warranties given by the Seller under this Agreement is construed as separate and is not limited or restricted by reference to any other Representations and Warranties given by the Seller. |
3.1.3 | The Parties agree that the rights and remedies of the Purchaser in respect of the Representations and Warranties given by the Seller under this Agreement shall not be affected by (i) the Closing or (ii) any investigation made into the affairs of the Seller and/or the Company, their assets and, or any knowledge held or gained of any such affairs, assets and business by or on behalf of the Purchaser (and/or any of its Affiliates), or (iii) the waiver by the Purchaser of any Condition Precedent or right under this Agreement. For the sake of clarity, the execution of the Closing, including in case the Purchaser waives one or more Conditions Precedent, shall not imply in any case a waiver or limitation of any of the Representations and Warranties given by the Seller under this Agreement nor of the responsibilities of the Seller arising therefrom. |
3.2 | Representations and Warranties relating to the Company |
3.2.4 | Organization and Good Standing |
3.2.5 | Title to the Shares |
3.2.5.1 | Seller is the sole owner of the Shares, which Shares constitute the entire outstanding share capital of the Company. |
3.2.5.2 | The Shares have been validly issued, subscribed and are fully paid-up, have not been repurchased or reimbursed by the Company and are not the subject to any action, proceeding or arbitration pending or threatened in writing received by the Company or the Seller. |
3.2.5.3 | The Shares are all of the same class or category and entitle their holders to the same rights and obligations. |
3.2.5.4 | The Company has not issued, nor agreed to issue, any securities or other equity or debt securities other than the Shares, nor any |
3.2.6 | Transfer the Shares |
3.2.6.1 | violate any Law or material Permit; |
3.2.6.2 | conflict with, or result in a breach of, or give rise to an event of default under, or require the consent of a Person under, or - except as described in Schedule 3.2.3.2 - enable a Person to terminate an agreement to which the Company is a party; |
3.2.6.3 | result in the payment of any change of control indemnity as regards any of the Contracts and/or trigger the early repayment of any loan or credit facility granted to the Company; or |
3.2.6.4 | result in the Company losing the benefit of a material Permit, grant, or subsidy which it enjoys at the date of this Agreement in which the Company operates. |
3.2.7 | Share Capital |
3.2.8 | Articles of Association - Books and Records |
3.2.9 | Interests in companies |
3.2.10 | Financial Statements |
3.2.11 | Compliance with Laws; Permits |
3.2.12 | Transactions with Affiliates |
3.2.13 | Movables assets |
3.2.14 | Real Property and Lease Contracts |
3.2.15 | Employees |
3.2.16 | Litigation and compliance |
3.2.17 | Guarantees |
3.2.18 | Insurance |
3.2.19 | Taxes |
3.2.19.1 | all Tax Returns delivered by the Company have been duly and timely presented to the competent public authorities and have been prepared in compliance with the relevant provisions of law and regulation; |
3.2.19.2 | all Taxes and tax penalties to be paid by the Company have been fully, duly and timely paid by the relevant expiration date. |
3.2.20 | Environmental Matters |
3.2.21 | Permits |
3.2.22 | Stock Options |
3.2.23 | Brokerage Fees and Costs |
3.2.24 | Intellectual Property |
3.2.25 | Information Technology and Data Protection |
3.2.26 | Contracts |
3.2.26.1 | Schedule 3.2.23.1 lists all Contracts (other than Organizational Documents of the Company, Leases and Contracts related to transactions with Affiliates or Employee benefits and other labor matters) that are material to the business of the Company as of the date hereof (collectively, “Material Contracts”). |
3.2.26.2 | The Material Contracts have been entered into at arm’s length. |
3.2.26.3 | Each of the Material Contracts is valid and in full force and effect and the terms thereof have been complied with by the Company. To the Seller’s Knowledge, there are no grounds for withdrawal, termination, rescission, avoidance or repudiation of any of such Contracts. No notice of termination or of intention to terminate has been received in respect of any of the Material Contracts. |
3.2.26.4 | None of the Material Contracts include a change of control clause except for those listed under Schedule 3.2.23.4. |
3.2.26.5 | The Company is not party to any Contract or obligation which (i) is not in the ordinary and usual course of business; (ii) is not commercially reasonable and, in the reasonable opinion of the Seller, cannot be readily fulfilled or performed by the Company without undue or unusual expenditure of money and effort or |
3.2.27 | Decree 231/2001 |
3.2.27.1 | Neither the Seller nor the Company nor their directors, consultants or employees or, to the Seller’s Knowledge, other Persons that are under the supervision or direction of the Company's directors and Key Employees, are or at any time have engaged in any activity, practice or conduct which would constitute an offence under Decree 231/2001. |
3.3 | Representations and Warranties relating to the Seller |
3.3.6 | Organization and Good Standing |
3.3.7 | Authorization |
3.3.8 | No Violations |
3.3.9 | Ownership of Shares |
3.3.10 | Brokers and Finders |
4. | Warranties of Purchaser |
4.1 | Purchaser hereby warrants to the Company that as of the date of this Agreement and as of the Closing Date: |
4.1.28 | Organization and Good Standing |
4.1.29 | Authorization |
4.1.30 | Governmental Filings - No Violations |
4.1.30.1 | No notices, reports, filings or other approvals are required to be made by Purchaser with, nor are any consents, registrations, approvals, permits or authorizations required to be obtained by Purchaser from, any Governmental Entity in connection with the execution of this Agreement by Purchaser and the consummation by Purchaser of the Transaction. |
4.1.30.2 | The execution of this Agreement by Purchaser does not violate any Law or material Permit and does not conflict with, or result in breach of, or give rise to an event of default under, or require the consent of a Person under, or enable a Person to terminate the Agreement. The Purchaser represents and warrants that the Transaction does not trigger any mandatory merger control filing on the basis of any applicable antitrust Laws. |
4.1.31 | Available Funds |
5. | Covenants of Seller |
5.1 | Seller Stockholders’ Meeting |
5.2 | Solicitation; Change in Recommendation |
5.2.1 | Except as otherwise permitted by this Agreement, the Seller agrees that it shall, and shall cause its subsidiaries, directors, officers and employees to, and shall instruct its other Representatives to, immediately cease all existing discussions or negotiations with any Person conducted heretofore with respect to any Takeover Proposal. Except as otherwise permitted by this Agreement, from the date hereof until the earlier of the Closing Date or the date, if any, on which this Agreement is terminated pursuant to Section 10.1, the Seller shall not, and shall cause its subsidiaries, directors and officers not to, and shall instruct its other Representatives not to, directly or indirectly, (i) solicit, initiate, knowingly encourage or knowingly facilitate any Takeover Proposal or the making or consummation thereof or (ii) enter into, or otherwise participate in any discussions (except to notify such Person of the existence of the provisions of this Section 5.2) or negotiations regarding, or furnish to any Person any non-public material information in connection with, any Takeover Proposal. |
5.2.2 | Notwithstanding anything to the contrary contained in this Agreement, if at any time on or after the date hereof and prior to obtaining the Stockholder Approval, the Seller or any of its subsidiaries, or any of its or their respective Representatives, receives a bona-fide Takeover Proposal from any Person or group of Persons, which Takeover Proposal did not result from a breach of this Section 5.2, the Seller, the Seller Board (or a duly authorized committee thereof) and their Representatives may engage in negotiations and discussions with, and furnish any information and other access to, any Person making such Takeover Proposal and any of its Representatives or potential sources of financing if the Seller Board (or duly authorized committee thereof) determines in good faith, after consultation with the Seller’s outside legal and financial advisors, that such Takeover Proposal is or could reasonably be expected to lead to a Superior Proposal and that not taking such action would reasonably be expected to be inconsistent with its fiduciary duties under applicable Law; provided that prior to furnishing |
5.2.3 | Except as otherwise provided in this Agreement, the Seller Board shall not (i)(A) withdraw or modify, or publicly propose to withdraw or modify, in a manner adverse to Purchaser, the Seller Board Recommendation or (B) approve or recommend, or publicly propose to approve or recommend, to the stockholders of the Seller a Takeover Proposal (any action described in this clause (i) being referred to as a “Seller Adverse Recommendation Change”) or (ii) authorize the Seller or any of its subsidiaries to enter into any letter of intent, merger, acquisition or similar agreement with respect to any Takeover Proposal (other than a customary confidentiality agreement). |
5.2.4 | Notwithstanding anything to the contrary in this Agreement, the Seller Board (or a duly authorized committee thereof) may make a Seller Adverse Recommendation Change in response to either (x) a Superior Proposal or (y) an Intervening Event (and, solely with respect to a Superior Proposal, terminate this Agreement pursuant to Section 10.1.5), if: |
5.2.4.5 | the Seller Board (or a duly authorized committee thereof) determines in good faith, after consultation with its outside legal counsel, that the failure to take such action would reasonably be expected to be inconsistent with its fiduciary duties under applicable Law (after taking into account all adjustments to the terms of this Agreement that may be offered by Purchaser pursuant to this Section 5.2.4); |
5.2.4.6 | solely with respect to a Superior Proposal: (A) the Seller provides Purchaser prior written notice of its intent to make any Seller Adverse Recommendation Change or terminate this Agreement pursuant to Section 10.1.5, together with a copy of the acquisition agreement (and any other relevant transaction documents) with respect to such Superior Proposal, if any, at least three (3) Business Days prior to taking such action, to the effect that the Seller Board has received a Superior Proposal and, absent any revision to the terms and conditions of this Agreement, the Seller Board has resolved to effect a Seller Adverse Recommendation Change or to terminate this Agreement pursuant to Section 10.1.5, which notice shall specify the basis for such Seller Adverse Recommendation Change or termination, including the material terms of the Superior Proposal (a “Notice of Superior Proposal”) (it being understood that such Notice of Superior Proposal shall not in |
5.2.4.7 | solely with respect to any Intervening Event: (A) at least three (3) Business Days before making a Seller Adverse Recommendation Change with respect to such Intervening Event, the Seller notifies Purchaser in writing of its intention to do so, specifies the reasons therefor and provides a description of such Intervening Event; and (B) if Purchaser makes a written, binding and irrevocable offer capable of being accepted by the Seller during such three (3) Business Day period to alter the terms or conditions of this Agreement, the Seller Board, after taking into consideration the adjusted terms and conditions of this Agreement as proposed by Purchaser, continues to determine in good faith (after consultation with outside counsel) that the failure to make such Seller Adverse Recommendation Change would reasonably be expected to be inconsistent with its fiduciary duties under applicable Law. |
5.2.5 | Nothing contained in this Agreement shall prohibit the Seller or the Seller Board (or a duly authorized committee thereof) from (i) taking and disclosing to the stockholders of the Seller a position contemplated by Rule 14e-2(a) under the Exchange Act or making a statement contemplated by Item 1012(a) of Regulation M-A or Rule 14d-9 under the Exchange Act, (ii) making any disclosure to the stockholders of the Seller if the Seller Board (or a duly authorized committee thereof) determines in good faith, after consultation with its outside legal counsel, that the failure to make such disclosure would be reasonably likely to be inconsistent with applicable Law, (iii) informing any Person of the existence of the provisions contained in this Section 5.2 or (iv) making any “stop, look and listen” communication to the stockholders of the Seller pursuant to Rule 14d-9(f) under the Exchange Act (or any similar communication to the stockholders of the Seller). No disclosures under this Section 5.2.5 shall be, in themselves, a breach of this Section 5.2 or a basis for Purchaser to terminate this Agreement pursuant to Section 10. |
5.2.6 | Notwithstanding this Section 5.2 or any other provision of this Agreement to the contrary, at any time prior to the receipt of Stockholder Approval, the Seller Board (or a duly authorized committee thereof) may grant a waiver or release under, or determine not to enforce any standstill agreement of the Seller if the Seller Board (or a duly authorized committee thereof) determines in good faith (after consultation with outside legal counsel) that the failure to take such action would reasonably be expected to be inconsistent with its fiduciary duties under applicable Law; provided, however, that the Seller shall give Purchaser notice of the grant by the Seller Board (or a duly authorized committee thereof) at least 24 hours before granting any such waiver or release. |
5.2.7 | As used in this Agreement, “Takeover Proposal” shall mean any bona fide inquiry, proposal or offer from any Person (other than Purchaser and any of its Affiliates) or “group” (as such term is defined in the Exchange Act) to purchase or otherwise acquire, in a single transaction or series of related transactions, (i) assets of the Company (excluding sales of assets in the ordinary course of business) that account for 20% or more of the Company’s consolidated assets (based on the fair market value thereof) or from which 20% or more of the Company’s revenues or earnings on a consolidated basis are derived, (ii) 20% or more of the outstanding Company common stock pursuant to a merger, consolidation or other business combination, sale of shares of capital stock, tender offer, exchange offer or similar transaction, or (iii) 20% or more of the outstanding Seller common stock pursuant to a merger, consolidation or other business combination, sale of shares of capital stock, tender offer, exchange offer or similar transaction. |
5.2.8 | As used in this Agreement, “Superior Proposal” shall mean any bona fide written Takeover Proposal on terms which the Seller Board (or a duly authorized committee thereof) determines in good faith, after consultation with the Seller’s outside legal counsel and independent financial advisors, to be more favorable to the Seller or the holders of Seller common stock than the Transaction (after taking into account any revisions to this Agreement set forth in any written, binding and irrevocable offer by Purchaser capable of being accepted by the Seller), taking into account, to the extent applicable, the legal, financial, regulatory and other aspects of such proposal and this Agreement that the Seller Board considers relevant; provided that for purposes of the definition of Superior Proposal, the references to “20%” in the definition of Takeover Proposal shall be deemed to be references to “50%.” |
5.2.9 | As used in this Agreement, “Intervening Event” shall mean an event, development or change in circumstance that was not actually known to the Seller Board prior to the execution of this Agreement (or if so known, the consequences of which, when taken together with all other events, developments or circumstances then known, were not actually known or reasonably foreseeable based on information actually known to the members of the Seller Board as of the date of this Agreement), which event, development or change in circumstance, or any consequence thereof, becomes known to the Seller Board prior to the receipt of the Stockholder Approval; provided, that in no event shall the receipt, existence or terms of a Takeover Proposal or any matter relating thereto or consequence thereof constitute an Intervening Event. |
5.3 | Access to Information by Purchaser and Purchaser’s Financing Sources |
5.4 | Conduct of Business |
5.4.1 | use all commercially reasonable efforts to preserve its business organization intact and maintain its existing relations and goodwill with customers, suppliers and employees; |
5.4.2 | continue all planned sales, marketing and promotional activities relating to the business and operations of the Company, which are consistent with past practice; |
5.4.3 | not amend the Organizational Documents of the Company; |
5.4.4 | not (i) authorize, issue, sell or otherwise dispose of any shares of or any other securities with respect to the Company, or modify or amend any right of any holder of outstanding shares of the Company; (ii) transfer, sell, dispose of or encumber any portion of its assets, other than purchases and sales of inventory in the ordinary course of business; or (iii) incur any |
5.4.5 | other than as may be required by applicable Law or in the ordinary course of business, not (i) increase the compensation payable or to become payable to Employees and/or Key Employees; (ii) grant any rights to severance or termination pay to, or enter into any employment or severance agreement with any Employee and/or Key Employee other than pursuant to arrangements previously entered into as set forth in Schedule 5.4.5; or (iii) establish, adopt, enter into or amend, any collective bargaining agreement or Employee/Key Employee benefit; |
5.4.6 | except in the ordinary course of business or in connection with factoring arrangements, not (i) enter into any Contract which is material to the Company, or (ii) amend or terminate any Material Contract; |
5.4.7 | not acquire by merger, consolidation, acquisition of assets or equity interests or any similar transaction any corporation, partnership, limited liability company or other business organization or all or substantially all of the assets of any such entity; |
5.4.8 | not settle or comprise any material claim or litigation; |
5.4.9 | except in the ordinary course of business, consistent with past practice, not permit any change in (i) any pricing, investment, accounting, financial reporting, inventory, credit, allowance or Tax practice or policy of the Company, or (ii) any method of calculating any bad debt, contingency or other reserve of the Company for accounting, financial reporting or Tax purposes, or (iii) its policies and practices relating to the terms and conditions of its account receivables and payables; |
5.4.10 | except as otherwise permitted hereunder or in order to effect the transactions contemplated hereby, not enter into any Contract or amend or modify any existing Contract with Seller or any of its Affiliates or any officer or director of Seller or its Affiliates, and not engage in any transaction outside the ordinary course of business consistent with past practice or not on an arm’s-length basis with any such Person. |
5.5 | Repayment of intercompany debt |
5.6 | Use of Tecnonet name |
5.7 | Notification |
5.8 | Non-competition |
6. | Covenants of Purchaser |
6.1 | Use of MRV name |
6.2 | Access to Information after Closing |
6.2.1 | Purchaser shall use its best efforts to provide reasonable access to Seller or its representatives to the books, documents, data and information of the Company during normal business hours, insofar as such information is required or relevant to protect the legitimate interests of Seller, particularly in connection with Italian or United States taxation matters, any requests for or obligations to provide information to the United States Securities and Exchange Commission, or in connection with the requirements of applicable Law, legal disputes with third parties, or for evaluation of and in response to possible claims under this Agreement. If Seller makes use of this right of access, Seller shall (i) reimburse the Company for all reasonable expenses incurred in connection with such access and inspection of documents and (ii) keep such information, as well as any other information acquired during such inspections, confidential in accordance with Section 5.3. |
6.2.2 | In connection with any reasonable business purpose, including (i) in response to the request or at the direction of a Governmental Entity, (ii) the preparation of Tax Returns, (iii) the determination of any matter relating to the rights or obligations of Seller under this Agreement; and (iv) taxation matters, any requests for or obligations to provide information to the United States Securities and Exchange Commission, or in connection with compliance with any Laws applicable to Seller, legal disputes with third parties, or for evaluation of and in response to possible claims under this Agreement, subject to any applicable Law and subject to any applicable privileges (including the attorney-client privilege and any confidentiality obligations towards third parties), upon reasonable prior written notice, the Purchaser shall use commercially reasonable efforts to cause the Company to: (A) provide Seller and its representatives information with respect to the Company for periods prior to Closing Date, (B) afford Seller and its representatives reasonable access, during normal business hours, to the offices, properties, books, data, files, information and records of the Company, and (C) make available to Seller and its representatives the Company employees and outside auditors whose assistance, expertise, testimony, notes and recollections or presence is necessary at their workplace or otherwise to assist Seller or its affiliates in connection with any of the purposes referred to above; provided, however, that the foregoing would not in the reasonable judgment of the Purchaser result in any disclosure of any trade secrets or violate any of its obligations with respect to confidentiality, that such access shall not unreasonably interfere with the business or operations of the Company, that Seller and its representatives keep such information confidential. Notwithstanding anything to the contrary in this Agreement, neither Purchaser nor, after Closing, the Company shall be required to disclose any information to Seller if such disclosure would contravene any applicable Law. |
6.2.3 | Seller shall have the right to retain copies of all books and records of the Company relating to periods ending on or prior to the Closing Date subject to compliance with applicable law. Seller shall keep such documents confidential. The Purchaser agrees that, from and after the Closing Date, with respect to all original books and records of the Company, the Purchaser will (and will cause the Company to) (i) comply in all material respects with applicable law relating to the preservation and retention of records and (ii) apply preservation and retention policies that are no less stringent than those generally applied by the Purchaser. |
6.2.4 | In addition, the Purchaser shall use its best effort to deliver to Seller, no later than the earlier of 21 days after Closing Date or 10 days after the end of the fiscal quarter in which the Closing Date takes place, a reporting package using the regular monthly reporting package used by the Company to report its financial results to Seller, except that the balance sheet data will be as of the Closing Date and the statement of operations data will be for the period then ended. |
6.3 | Employees; Benefit Plans |
6.3.11 | During the period commencing at the Closing and ending on the date which is 6 (six) months from the Closing (or if earlier, the date of the employee's termination of employment with the Company), Purchaser shall and shall cause the Company to provide each Employee who remains employed immediately after the Closing (“Company Continuing Employee”) with: (i) base salary or hourly wages which are no less than the base salary or hourly wages provided by the Company immediately prior to the Closing; (ii) target bonus opportunities (excluding equity-based compensation), if any, which are no less than the target bonus opportunities (excluding equity-based compensation) provided by the Company immediately prior to the Closing; (iii) retirement and welfare benefits that are no less favorable in the aggregate than those provided by the Company immediately prior to the Closing; and (iv) severance benefits that are no less favorable than the practice, plan or policy in effect for such Company Continuing Employee immediately prior to the Closing. The foregoing does not limit the ability of the Company to dismiss for just cause or justified reason, subjective or objective, accept the resignation of, implement a collective dismissal procedure or offer incentives to leave to, the Company Continuing Employees. |
6.3.12 | This Section 6.3 shall be binding upon and inure solely to the benefit of each of the parties to this Agreement, and nothing in this Section 6.3, express or implied, shall confer upon any other Person any rights or remedies of any nature whatsoever under or by reason of this Section 6.3. Nothing contained herein, express or implied, shall be construed to establish, amend or modify any benefit plan, program, agreement or arrangement. The parties hereto acknowledge and agree that the terms set forth in this Section 6.3 shall not create any right in any Employee or any other Person to any continued employment with the Company, Purchaser or any of their respective Affiliates or compensation or benefits of any nature or kind whatsoever. |
7. | Additional Covenants of Seller and Purchaser |
7.1 | Publicity |
7.2 | Other Actions |
7.2.13 | Purchaser and Seller shall cooperate with each other and use commercially reasonable efforts to take or cause to be taken all actions, and do or cause to be done all things, necessary, proper or advisable on its part under this Agreement and applicable Law to consummate the Transaction, including preparing and submitting as promptly as practicable all documentation to effect all necessary notices, reports, submissions and other filings. |
7.2.14 | In furtherance and not in limitation of the foregoing, each of Purchaser and Seller shall (i) execute and deliver, or cause to be executed and delivered, such documents and other instruments and take, or cause to be taken, such further actions as may be reasonably required to carry out the provisions of this Agreement and give effect to the Transaction, and (ii) refrain from taking any actions that could reasonably be expected to impair, delay or impede the Closing. |
8. | Conditions to Closing |
8.1 | Conditions to Obligations of Purchaser |
8.1.14.1 | Seller shall have performed in all material respects all obligations required to be performed by Seller under this Agreement at or prior to the Closing. |
8.1.14.2 | Seller shall have obtained the Stockholder Approval. |
8.1.14.3 | The Seller’s Representations and Warranties shall be true and correct in all respects (in the case of any representation or warranty qualified by materiality) or in all material respects (in the case of any representation or warranty not qualified by materiality) as of Closing Date. |
8.1.14.4 | From the date of this Agreement, there shall not have occurred any Material Adverse Effect. |
8.2 | Conditions to Obligations of Seller |
8.2.1.8 | Purchaser shall have performed in all material respect all obligations required to be performed by Purchaser under this Agreement at or prior to the Closing. |
8.2.1.9 | Seller shall have obtained the Stockholder Approval. |
8.2.1.10 | The Purchaser’s Representations and Warranties shall be true and correct in all respects (in the case of any representation or warranty qualified by materiality) or in all material respects (in the case of any representation or warranty not qualified by materiality) as of Closing Date. |
8.3 | Disclosure and cooperation |
8.4 | Waiver |
9. | Indemnification |
9.1 | General Indemnification |
9.1.2 | Seller shall indemnify Purchaser and/or the Company, as the case may be, in respect of, and hold them harmless from and against, any Loss suffered by the Purchaser and the Company for breach by the Seller of the Representations and Warranties or for breach of any other obligations provided for in this Agreement. |
9.1.3 | Notwithstanding the foregoing, the Purchaser shall use its best efforts to prevent and mitigate any Loss it may incur as a consequence of the breaches referred to above. The Seller shall not be liable should a Loss be, in whole or in part, the result of an act or omission of the Purchaser or the Company committed after the Closing Date. |
9.1.4 | No Person, other than the Purchaser and/or the Company, as the case may be, will be entitled to make a claim under this Agreement, nor will damages be calculated by reference to a Loss suffered by any Person other than the Purchaser and/or the Company, as the case may be. |
9.1.5 | Any payment made by the Seller hereunder shall be deemed as a reduction of the Purchase Price. No interest shall accrue on payments to be made by the Seller hereunder until the due date. |
9.1.6 | Notwithstanding anything to the contrary contained in this Agreement, no amounts of indemnity pursuant to Section 9.1.1 shall be payable as a result of any claim in respect of a Loss: |
9.1.6.1 | unless, with respect to any claim (including claims relating to substantially the same factual circumstances), such claim involves Losses in excess of Euro 10,000 (ten thousand); |
9.1.6.2 | unless and until Purchaser has suffered, incurred, sustained or become subject to Losses in excess of 1% (one percent) of the Purchase Price in the aggregate, provided that once such threshold has been reached, the Seller will be liable for the whole amount and not only for the excess; and |
9.1.6.3 | if Purchaser has received payments in respect of Losses of an amount equal to 20% (twenty percent) of the Purchase Price in the aggregate, |
9.1.7 | The Parties agree that: |
9.1.7.1 | in case the Loss is tax deductible, then the liability of the Seller shall be limited to the amount of the Loss, less the tax deduction which will be realized by the Purchaser or the Company; |
9.1.7.2 | the Seller will not be liable in respect of any Loss, to the extent that it arises or is increased or extended as a result of an increase in the rates of taxes or any change in Tax practice occurring after Closing; |
9.1.7.3 | the Seller shall not be liable in respect of any Loss, to the extent that it arises as a result of a change in the Law or in any regulation requirement or code of conduct of any Governmental Authority and any change in any accounting policy; |
9.1.7.4 | the Seller will not be responsible for Losses if, and to the extent that, the relevant amount is recoverable by the Purchaser or the Company from their respective insurers; |
9.1.7.5 | should the Company benefit from the receipt of contingent income of any other contingent assets, of any kind whatsoever in connection with or resulting from a Loss, then the liability of the Seller will be further reduced by the corresponding amounts; |
9.1.7.6 | the Seller will not be liable to the extent that a claim relates to a liability that is contingent only, unless and until such contingent liability becomes an actual liability or until it is finally adjudicated (including by way of a decision that although not final, is provisionally enforceable); in this respect, notwithstanding anything to the contrary herein, any Third Party Claim including a payment request will considered as an actual Loss if an order or a decision is issued by a Governmental Authority which is enforceable (including provisionally), in which case the Loss shall be indemnified by the Seller before the date on which the payment to the third party by the Company or the Purchaser becomes due; |
9.1.7.7 | the Seller shall not have any liability under any provision of the Agreement for any damages which are not direct and immediate, within the meaning of article 1223 of the Civil Code (including punitive damages); |
9.1.7.8 | the Purchaser is not entitled to recover more than once in respect of any matter giving rise to a claim; and |
9.1.7.9 | no tax gross up shall be made on payments to be made hereunder by the Seller to the Purchaser, even if they are taxable in the hands of the Purchaser. |
9.1.8 | The Purchaser shall use all its best efforts, at its sole expense and as requested by the Seller, to pursue any and all rights to reimbursement, recovery or indemnification with respect to all Losses for which it is entitled pursuant to any Contract (other than insurance policies) executed by it or by the Company with any Person, or pursuant to the extra contractual liability of any Person. |
9.1.9 | If the Seller pays to the Purchaser an amount in discharge of a Loss and the Purchaser subsequently recovers from a third party a sum which is attributable to the subject matter of the Claim, the Purchaser shall promptly pay to the Seller an amount equal to all amounts recovered, up to the aggregate amount thus paid by the Seller. |
9.1.10 | Notwithstanding anything to the contrary herein, the Parties acknowledge and agree that all qualifications in the Representations and Warranties as to “materiality” shall be disregarded following the Closing, including for the purposes of determining (i) whether or not there is a breach of, or any inaccuracy or misrepresentation with respect to, any representation or warranty for which indemnification would be available under Section 9 and (ii) the amount of any Losses to be indemnified. |
9.2 | Handling of Claims |
9.2.1 | If any event occurs which could give rise to the Seller’s liability under this Agreement, the Purchaser shall deliver to the Seller a written claim in relation to such event as promptly as practicable and in any event within and no later than 15 (fifteen) Business Days following the date on which the Purchaser or the Company became aware of such event and shall provide all reasonable particulars thereof, indicating the provision of this Agreement which have been allegedly breached. Should the Purchaser fail to timely deliver such claim to the Seller, the Purchaser, in any case, shall not lose its right to compensation. The Seller agrees to respond to the Purchaser within 15 (fifteen) Business Days as of the date of receipt of the claim, to challenge the Indemnification claim, it being understood that failure to timely respond may not be considered as acceptance of the Claim, and the Purchaser will be considered free to commence or continue the relevant litigation. |
9.2.2 | On condition that the Seller has acknowledged its indemnification liability vis-à-vis the Purchaser and the Company in relation to a Third Party Claim, if a firm offer is made to the Company or to the Purchaser to settle any Third Party Claim which the Purchaser (or the Company), but not the Seller, is willing to accept, the Purchaser and/or the Company (as the case may be) shall be free to enter into such settlement, at their own expense, it being understood that the Seller shall be relieved of any liability in connection thereof. |
9.2.3 | If a firm offer is made to the Company or to the Purchaser to settle any Third Party Claim which the Seller, but not the Purchaser, is willing to accept, the Purchaser and/or the Company (as the case may be) shall be free not to enter into such settlement and to commence or continue the relevant litigation, at their own expense, it being understood that the liability of the Seller in |
9.3 | Survival |
9.3.1 | The warranties (including the Representations and Warranties), covenants and agreements of Seller and Purchaser contained in this Agreement will survive the Closing: |
9.3.1.1 | Until the expiry of the applicable statute of limitation period with respect to the Representations and Warranties contained in Sections 3.2.1, 3.2.2, 3.2.4, 3.2.16, 3.2.24 (only with respect to bribery or other criminal offences against or involving any Governmental Entities and the related consequences under the Decree 231/2001), 3.3.1, 3.3.2 and 3.3.4. |
9.3.1.2 | until the 24 (twenty four) month anniversary of the Closing Date in the case of all other Representations and Warranties and any covenant or agreement to be performed in whole or in part on or prior to the Closing; |
9.3.1.3 | with respect to each other covenant or agreement contained in this Agreement, until 1 (one) year following the last date on which such covenant or agreement is to be performed as specified herein or, of no such date is specified, until the 36 (thirty six)-month anniversary of the Closing Date; |
9.4 | Special Indemnity |
9.4.1 | The Seller agrees that, should any of the credit receivables of the Company towards Vitrociset S.p.A. - for an amount as of the Signing Date equal to the outstanding consideration provided under the relevant Contract not be fully paid and discharged within 3 months from the Closing Date it will purchase from the Company, within 3 Business Days from the Purchaser's written request, all such receivables then still outstanding, for a price equal to their nominal value, to be paid immediately from the Seller to the Company upon such purchase. |
9.4.2 | If during the 12 months after the Closing the Company collects payment on accounts receivable in excess of their carrying value on the books and records of the Company as of the Closing Date, the Purchaser shall promptly pay to the Seller an amount equal to such excess. |
9.5 | Sole Remedy |
10. | Termination |
10.1 | Termination Events |
10.1.4 | at any time before the Closing, by mutual written agreement of Seller and Purchaser; |
10.1.5 | at any time before the Closing, by Seller or Purchaser, in the event (i) of a material breach by the non-terminating Party of its covenants contained in this Agreement, if such non-terminating Party fails to cure such breach within five (5) Business Days following notification thereof by the terminating Party or (ii) upon notification of the non-terminating Party by the terminating Party that the satisfaction of any condition to the terminating Party’s obligations under this Agreement becomes impossible or impracticable with the use of commercially reasonable efforts temporary impossible for a cause not imputable to the terminating Party and in any case if the failure of such condition to be satisfied is not caused by a breach hereof by the terminating Party; |
10.1.6 | at any time by Seller or Purchaser after the Seller Stockholder’s Meeting has been held (and not further adjourned) and the Stockholder Approval has not been obtained; provided that the right to terminate this Agreement pursuant to this Section 10.1.3 shall not be available to the Seller unless the Seller pays or has paid the Termination Fee to Purchaser; |
10.1.7 | at any time after November 30, 2015 (the “Long Stop Date”) by Seller or Purchaser upon notification of the non-terminating Party by the terminating Party if the Closing shall not have occurred on or before such date and such failure to consummate the Transaction is not caused by a breach of this Agreement by the terminating Party; it is agreed that the Long Stop Date will be automatically postponed to December 31, 2015 if the Seller has filed the Final Proxy Statement by November 30, 2015; |
10.1.8 | at any time by the Seller in order to enter into a definitive agreement providing for a Superior Proposal, in accordance with Section 5.2; provided that the right to terminate this Agreement pursuant to this Section 10.1.5 shall not be available to the Seller unless the Seller pays or has paid the Termination Fee to Purchaser, it being understood that the Seller may enter into any transaction that is a Superior Proposal simultaneously with the termination of this Agreement pursuant to this Section 10.1.5. |
10.2 | Termination Fee |
10.3 | Effect of Termination |
11. | Miscellaneous and General |
11.1 | Amendment; Waivers; Etc. |
11.2 | Expenses |
11.3 | Governing Law |
11.4 | Arbitration |
11.5 | Notices |
11.5.1 | upon actual delivery if delivered by hand; |
11.5.2 | by registered mail. |
11.6 | Entire Agreement |
11.7 | No Third Party Beneficiaries |
11.8 | Severability |
11.9 | Interpretation |
11.9.1 | This Agreement shall be construed without regard to any presumption or rule requiring construction or interpretation against the Party drafting or causing any instrument to be drafted. |
11.9.2 | All Schedules annexed hereto or referred to herein are hereby incorporated in and made a part of this Agreement as if set forth in full herein. |
11.10 | Successors and Assigns |