Exhibit 10.1

  

Execution Version

 

 

 

 

 

 

 

 

 

AGREEMENT AND PLAN OF MERGER

 

BY AND AMONG

 

AVX CORPORATION,

 

ARMSTRONG ALPERT, INC.,

 

ETHERTRONICS, INC.,

 

AND

 

FORTIS ADVISORS LLC, AS STOCKHOLDER REPRESENTATIVE

 

 

 

 

Dated as of December 29, 2017

 

 

 

 

 

 

 

 

 

 

--------------------------------------------------------------------------------

 

 

Table of Contents

 

Page

 

 

Article I           DEFINITIONS

2

         

Section 1.1

280G Waiver

2

 

Section 1.2

2016 Balance Sheet

2

 

Section 1.3

Adjustment Pro Rata Share

2

 

Section 1.4

Affiliate

2

 

Section 1.5

Aggregate Exercise Price

2

 

Section 1.6

Aggregate Preference Amount

2

 

Section 1.7

Agreement

2

 

Section 1.8

Ancillary Documents

3

 

Section 1.9

Basket

3

 

Section 1.10

Books and Records

3

 

Section 1.11

Business Day

3

 

Section 1.12

Cancelled Shares

3

 

Section 1.13

Cap

3

 

Section 1.14

CERCLA

3

 

Section 1.15

Certificate of Merger

3

 

Section 1.16

Certificate

3

 

Section 1.17

Circular 698

3

 

Section 1.18

Closing

3

 

Section 1.19

Closing Company Transaction Expenses Certificate

3

 

Section 1.20

Closing Date

4

 

Section 1.21

Closing Indebtedness and Net Debt Certificate

4

 

Section 1.22

Closing Merger Consideration

4

 

Section 1.23

Closing Per Option Merger Consideration

4

 

Section 1.24

Closing Per Share Merger Consideration

4

 

Section 1.25

Closing Working Capital

4

 

Section 1.26

Closing Working Capital Statement

4

 

Section 1.27

COBRA

4

 

Section 1.28

Code

4

 

Section 1.29

Commercial Tax Agreement

4

 

Section 1.30

Company

4

 

Section 1.31

Company Affiliate

5

 

Section 1.32

Company Board

5

 

Section 1.33

Company Bylaws

5

 

Section 1.34

Company Capital Stock

5

 

Section 1.35

Company Cash

5

 

Section 1.36

Company Charter

5

 

Section 1.37

Company Common Stock

5

 

Section 1.38

Company Preferred Stock

5

 

Section 1.39

Company Contracts

5

 

Section 1.40

Company Disclosure Letter

5

 

Section 1.41

Company Indebtedness

5

 

Section 1.42

Company Indemnified Parties

6

 

-i-

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Table of Contents

(continued)

Page

 

 

 

Section 1.43

Company Insurance Expense

6

 

Section 1.44

Company Material Adverse Effect

6

 

Section 1.45

Company Source Code

6

 

Section 1.46

Company Stockholders

6

 

Section 1.47

Company Stockholder Approval

6

 

Section 1.48

Company Stock Plan

7

 

Section 1.49

Company Transaction Expenses

7

 

Section 1.50

Company Warrants

7

 

Section 1.51

Competition Law

7

 

Section 1.52

Consideration Spreadsheet

7

 

Section 1.53

Contractors

7

 

Section 1.54

Contracts

7

 

Section 1.55

Deeds

7

 

Section 1.56

Defect

8

 

Section 1.57

DGCL

8

 

Section 1.58

Disputed Amounts

8

 

Section 1.59

Dissenting Shares

8

 

Section 1.60

Effective Time

8

 

Section 1.61

Employee

8

 

Section 1.62

Employee Benefit Plan

8

 

Section 1.63

Environmental Claim

8

 

Section 1.64

Environmental Laws

9

 

Section 1.65

ERISA

9

 

Section 1.66

ERISA Affiliate

9

 

Section 1.67

Escrow Agent

9

 

Section 1.68

Escrow Agreement

9

 

Section 1.69

Escrow Funds

9

 

Section 1.70

Estimated Closing Adjustment

9

 

Section 1.71

Estimated Closing Working Capital

9

 

Section 1.72

Estimated Closing Working Capital Statement

9

 

Section 1.73

Exchange Agent

9

 

Section 1.74

Extended Termination Date

9

 

Section 1.75

FCPA

9

 

Section 1.76

Final Order

10

 

Section 1.77

Financial Statements

10

 

Section 1.78

FLSA

10

 

Section 1.79

Foreign Benefit Plan

10

 

Section 1.80

Fraud

10

 

Section 1.81

Fully Diluted Share Number

10

 

Section 1.82

Fundamental Representations

10

 

Section 1.83

GAAP

10

 

Section 1.84

Governmental Authority

10

 

Section 1.85

Hazardous Substances

10

 

-ii-

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Table of Contents

(continued)

Page

 

 

 

Section 1.86

HSR Act

10

 

Section 1.87

Improvements

10

 

Section 1.88

Income Tax Return

11

 

Section 1.89

Indemnification Escrow Amount

11

 

Section 1.90

Indemnification Escrow Fund

11

 

Section 1.91

Indemnified Parties

11

 

Section 1.92

Indemnifying Party

11

 

Section 1.93

Independent Accountant

11

 

Section 1.94

Intellectual Property

11

 

Section 1.95

Interim Balance Sheet

11

 

Section 1.96

Interim Financial Statements

11

 

Section 1.97

Inventions

11

 

Section 1.98

IRS

11

 

Section 1.99

Knowledge of the Company

12

 

Section 1.100

Labor Laws

12

 

Section 1.101

Law

12

 

Section 1.102

Leased Real Property

12

 

Section 1.103

Letter of Transmittal

12

 

Section 1.104

License Agreements

12

 

Section 1.105

Lien

12

 

Section 1.106

Loss

12

 

Section 1.107

Majority Holders

12

 

Section 1.108

Merger

12

 

Section 1.109

Merger Consideration

12

 

Section 1.110

Merger Subsidiary

12

 

Section 1.111

Merger Subsidiary Common Stock

12

 

Section 1.112

Net Debt

12

 

Section 1.113

Net Debt Adjustment

13

 

Section 1.114

OFAC

13

 

Section 1.115

Open Source Materials

13

 

Section 1.116

Option

13

 

Section 1.117

Optionholder

13

 

Section 1.118

Owned Real Property

13

 

Section 1.119

Parent

13

 

Section 1.120

Parent Indemnified Parties

13

 

Section 1.121

Party; Parties

13

 

Section 1.122

Pending IP

13

 

Section 1.123

Permits

13

 

Section 1.124

Permitted Liens

13

 

Section 1.125

Person

13

 

Section 1.126

Phase I Environmental Site Assessment

13

 

Section 1.127

Post-Closing Adjustment

14

 

Section 1.128

Post-Closing Tax Period

14

 

-iii-

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Table of Contents

(continued)

Page

 

 

 

Section 1.129

Pre-Closing Income Tax Return

14

 

Section 1.130

Pre-Closing Other Tax Return

14

 

Section 1.131

Pre-Closing Tax Period

14

 

Section 1.132

Pre-Closing Tax Return

14

 

Section 1.133

Proceeding

14

 

Section 1.134

Product

14

 

Section 1.135

Pro Rata Share

14

 

Section 1.136

Purchase Price

14

 

Section 1.137

Purchase Price Adjustment Escrow Amount

14

 

Section 1.138

Purchase Price Adjustment Escrow Fund

14

 

Section 1.139

Qualified Plans

14

 

Section 1.140

Real Property

15

 

Section 1.141

Real Property Leases

15

 

Section 1.142

Registered IP

15

 

Section 1.143

Release

15

 

Section 1.144

Required Consents

15

 

Section 1.145

Representations and Warranties Insurance Policy

15

 

Section 1.146

Representative Losses

15

 

Section 1.147

Resolution Period

15

 

Section 1.148

Restricted Nations

15

 

Section 1.149

Review Period

15

 

Section 1.150

Section 409A Plan

15

 

Section 1.151

Series A Preferred Stock

15

 

Section 1.152

Series B Preferred Stock

15

 

Section 1.153

Series C Preference Amount

15

 

Section 1.154

Series C Preferred Stock

15

 

Section 1.155

Series D Preferred Stock

15

 

Section 1.156

Series E Preference Amount

16

 

Section 1.157

Series E Preferred Stock

16

 

Section 1.158

Series F Preferred Stock

16

 

Section 1.159

Series B Warrant

16

 

Section 1.160

Series C Warrant

16

 

Section 1.161

Series D Warrant

16

 

Section 1.162

Series F Warrant

16

 

Section 1.163

Shares

16

 

Section 1.164

Stockholder Consent

16

 

Section 1.165

Stockholder Notice

16

 

Section 1.166

Stockholder Representative

16

 

Section 1.167

Stockholder Representative Escrow Amount

16

 

Section 1.168

Stockholder Representative Escrow Fund

16

 

Section 1.169

Straddle Period

16

 

Section 1.170

Subsidiaries

16

 

Section 1.171

Statement of Objections

16

 

-iv-

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Table of Contents

(continued)

Page

 

 

 

Section 1.172

Surviving Corporation

16

 

Section 1.173

Target Working Capital

17

 

Section 1.174

Tax Authority

17

 

Section 1.175

Taxes

17

 

Section 1.176

Tax Lien

17

 

Section 1.177

Tax Return

17

 

Section 1.178

Third-Party Claim

17

 

Section 1.179

Undisputed Amounts

17

 

Section 1.180

Unregistered IP

17

 

Section 1.181

Walk-Away Date

17

 

Section 1.182

Waived 280G Benefits

17

 

Section 1.183

Warrantholder

17

 

Section 1.184

Year-End Financial Statements

17

   

Article II           THE MERGER; CLOSING; CLOSING DELIVERABLES

18

     

Section 2.1

The Merger

18

 

Section 2.2

Effective Time

18

 

Section 2.3

Time and Place of Closing

18

 

Section 2.4

Closing Deliverables

19

 

Section 2.5

Certificate of Incorporation and Bylaws

21

 

Section 2.6

Name of the Surviving Corporation

21

 

Section 2.7

Directors of the Surviving Corporation

21

 

Section 2.8

Officers of the Surviving Corporation

22

   

Article III           EFFECT OF THE MERGER ON CAPITAL STOCK

22

     

Section 3.1

Effect on Capital Stock

22

 

Section 3.2

Treatment of Options; Company Stock Plan and Corporate Actions

23

 

Section 3.3

Treatment of Company Warrants

23

 

Section 3.4

Dissenting Shares

24

 

Section 3.5

Surrender and Payment

24

 

Section 3.6

Escrow Funds

26

 

Section 3.7

No Further Ownership Rights in Company Common Stock and Options

26

 

Section 3.8

Adjustments

27

 

Section 3.9

Withholding Rights

27

 

Section 3.10

Lost Certificates

27

 

Section 3.11

Working Capital Adjustment

27

 

Section 3.12

Consideration Spreadsheet

30

 

Section 3.13

Delivery of Closing Indebtedness and Net Debt Certificate and Closing Company
Transaction Expenses Certificate

31

   

Article IV           REPRESENTATIONS AND WARRANTIES OF THE COMPANY

31

 

-v-

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Table of Contents

(continued)

Page

 

 

 

Section 4.1

Organization and Authority of the Company

32

 

Section 4.2

Capitalization

32

 

Section 4.3

Authority Relative to this Agreement

34

 

Section 4.4

Consents and Approvals; No Violations

35

 

Section 4.5

Financial Statements

35

 

Section 4.6

Title to and Sufficiency of Assets

36

 

Section 4.7

Real Property

37

 

Section 4.8

Absence of Certain Events

39

 

Section 4.9

Litigation

41

 

Section 4.10

Employee Benefit Plans

41

 

Section 4.11

Labor and Employment Matters

45

 

Section 4.12

Tax Matters

47

 

Section 4.13

Compliance with Law; Permits

49

 

Section 4.14

Transactions with Affiliates

50

 

Section 4.15

Absence of Undisclosed Liabilities

51

 

Section 4.16

Environmental Matters

51

 

Section 4.17

Intellectual Property

52

 

Section 4.18

Insurance

56

 

Section 4.19

Company Contracts

57

 

Section 4.20

Suppliers and Customers

58

 

Section 4.21

Inventories

59

 

Section 4.22

Warranties; Product Liability

59

 

Section 4.23

Bank Accounts

60

 

Section 4.24

Accounts Receivable

60

 

Section 4.25

Books and Records

60

 

Section 4.26

Company Indebtedness

60

 

Section 4.27

Fees and Expenses of Brokers and Others

60

 

Section 4.28

Board Recommendation

60

 

Section 4.29

Required Vote

61

 

Section 4.30

Stockholder Notice

61

 

Section 4.31

Full Disclosure

61

   

Article V           REPRESENTATIONS AND WARRANTIES OF PARENT AND MERGER
SUBSIDIARY

61

     

Section 5.1

Organization and Authority of Parent and Merger Subsidiary

61

 

Section 5.2

Authority Relative to this Agreement

62

 

Section 5.3

Consents and Approvals; No Violations

62

 

Section 5.4

Litigation

62

 

Section 5.5

Fees and Expenses of Brokers and Others

63

 

Section 5.6

Financing

63

 

Section 5.7

Acknowledgement

63

   

Article VI          COVENANTS RELATING TO CONDUCT OF BUSINESS

63

 

-vi-

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Table of Contents

(continued)

Page

 

 

 

Section 6.1

Operation in the Ordinary Course

63

 

Section 6.2

Affirmative and Negative Covenants

64

 

Section 6.3

No Control of the Company’s Business

66

 

Section 6.4

No Negotiation

66

       

Article VII        ADDITIONAL AGREEMENTS

66

         

Section 7.1

Access to Information; Confidentiality

66

 

Section 7.2

Commercially Reasonable Efforts

67

 

Section 7.3

Public Announcements

67

 

Section 7.4

Notification of Certain Matters

68

 

Section 7.5

Payments of Company Transaction Expenses Prior to Closing

68

 

Section 7.6

Stockholder Consent; Stockholder Notice

68

 

Section 7.7

Resignations

69

 

Section 7.8

Governmental Approvals and Consents

69

 

Section 7.9

Environmental Testing

71

 

Section 7.10

Representations and Warranties Insurance Policy

72

 

Section 7.11

Indemnification of Directors and Officers

72

 

Section 7.12

Company Warrants; Other Agreements

73

 

Section 7.13

Benefit Plans

73

 

Section 7.14

Excess Parachute Payments

73

       

Article VIII        CONDITIONS PRECEDENT TO CONSUMMATION OF THE MERGER

74

         

Section 8.1

Conditions Precedent to Obligations of Each Party

74

 

Section 8.2

Conditions Precedent to Obligations of Parent and Merger Subsidiary

74

 

Section 8.3

Conditions Precedent to Obligations of the Company

75

 

Section 8.4

Frustration of Closing Conditions

76

       

Article IX          TERMINATION

76

         

Section 9.1

Termination

76

 

Section 9.2

Effect of Termination

77

 

Section 9.3

Expenses

77

       

Article X           TAX MATTERS

78

         

Section 10.1

Tax Indemnification

78

 

Section 10.2

Allocation of Tax Liability for Straddle Periods

78

 

Section 10.3

Cooperation; Audits

79

 

Section 10.4

Tax Returns

79

 

Section 10.5

Tax Controversies

80

 

Section 10.6

Transfer Taxes

81

 

Section 10.7

Treatment as Purchase Price Adjustment

81

 

Section 10.8

Tax Sharing Agreements

81

 

-vii-

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Table of Contents

(continued)

Page

 

 

 

Section 10.9

Survival, Conflict of Provisions and Procedures

81

   

Article XI          INDEMNIFICATION

81

     

Section 11.1

Indemnification by the Company Stockholders

81

 

Section 11.2

Indemnification by Parent and Merger Subsidiary

83

 

Section 11.3

Indemnification Procedures

84

 

Section 11.4

Survival of Representations and Warranties

86

 

Section 11.5

Exclusive Remedy

86

 

Section 11.6

Fraud and Intentional Misrepresentation

86

 

Section 11.7

Materiality

86

   

Article XII        MISCELLANEOUS

86

     

Section 12.1

Stockholder Representative

86

 

Section 12.2

Amendment

89

 

Section 12.3

Extension; Waiver

89

 

Section 12.4

Entire Agreement; Assignment

90

 

Section 12.5

Notices

90

 

Section 12.6

Governing Law; Consent to Jurisdiction; Arbitration

91

 

Section 12.7

Specific Performance

92

 

Section 12.8

Descriptive Headings

92

 

Section 12.9

Parties in Interest

92

 

Section 12.10

Execution of this Agreement

92

 

Section 12.11

Severability

92

 

-viii-

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SCHEDULES AND EXHIBITS

 

Schedules

 

Schedule 1.40

Company Disclosure Letter

Schedule 1.144

Required Consents

Schedule 2.7

Directors of the Surviving Corporation

Schedule 2.8

Officers of the Surviving Corporation

Schedule 4.12(b)

Authorized Tax Return Preparers

Schedule 7.7

Resignations of Officers and Directors

Schedule 8.1(b)

Competition Law Filings

 

Exhibits

 

Exhibit A

Form of Escrow Agreement

Exhibit B   Form of Certificate of Merger

Exhibit C

Form of Letter of Transmittal

Exhibit D

Form of Stockholder Consent

Exhibit E

Binder Agreement and Draft Policy for Representations and Warranties Insurance
Policy

Exhibit F

Form of Restrictive Covenant Agreement

 

-ix-

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AGREEMENT AND PLAN of MERGER

 

This Agreement and Plan of Merger (this “Agreement”), dated as of December 29,
2017, by and among AVX Corporation, a Delaware corporation (“Parent”), Armstrong
Alpert, Inc., a Delaware corporation and a wholly owned subsidiary of Parent
(“Merger Subsidiary”), Ethertronics, Inc., a Delaware corporation (the
“Company”), and Fortis Advisors LLC, a Delaware limited liability company,
solely in its capacity as Stockholder Representative (“Stockholder
Representative”), recites and provides as follows:

 

RECITALS

 

WHEREAS, the Parties intend that Merger Subsidiary be merged with and into the
Company, with the Company surviving that merger on the terms and subject to the
conditions set forth herein (the “Merger”);

 

WHEREAS, the board of directors of the Company (the “Company Board”) has
unanimously (a) determined that this Agreement and the transactions contemplated
hereby, including the Merger, are advisable and fair to, and in the best
interests of, the Company and its stockholders, (b) approved and declared
advisable this Agreement and the transactions contemplated hereby, including the
Merger, and (c) resolved to recommend adoption and approval of this Agreement by
the stockholders of the Company in accordance with the Delaware General
Corporation Law (the “DGCL”);

 

WHEREAS, following the execution of this Agreement, the Company shall seek to
obtain, in accordance with Section 228 of the DGCL, a written consent of its
stockholders approving this Agreement, the Merger and the transactions
contemplated hereby in accordance with Section 251 of the DGCL;

 

WHEREAS, the boards of directors of Merger Subsidiary has unanimously (a)
determined that this Agreement and the transactions contemplated hereby,
including the Merger, are advisable and fair to, and in the best interests of,
Merger Subsidiary and its sole stockholder, and (b) approved and declared
advisable this Agreement and the transactions contemplated hereby, including the
Merger;

 

WHEREAS, immediately following the execution of this Agreement, Parent, as the
sole stockholder of Merger Subsidiary, will act by written consent to approve
and adopt this Agreement in accordance with the DGCL; and

 

WHEREAS, a portion of the cash otherwise payable by Parent to the stockholders
of the Company in connection with the Merger shall be placed in escrow by
Parent, the release of which shall be contingent upon certain events and
conditions, all as set forth in this Agreement and the Escrow Agreement (as
defined herein).

 

AGREEMENTS

 

NOW, THEREFORE, in consideration of the premises, which are incorporated into
and made part of this Agreement, and of the mutual representations, warranties,
covenants, agreements and conditions set forth herein and other good and
valuable consideration, the receipt and sufficiency of which are hereby
acknowledged, the Parties hereby agree as follows:

 

 

--------------------------------------------------------------------------------

 

 

Article I

DEFINITIONS

 

Section 1.1     280G Waiver. “280G Waiver” shall have the meaning set forth in
Section 7.14 hereof.

 

Section 1.2     2016 Balance Sheet. “2016 Balance Sheet” shall have the meaning
set forth in Section 4.5 hereof.

 

Section 1.3     Adjustment Pro Rata Share. “Adjustment Pro Rata Share” shall
mean, with respect to any Company Stockholder or Optionholder, such Person’s
ownership interest in the Company as of immediately prior to the Effective Time,
determined by dividing (a) the sum of (i) the number of shares of Company Common
Stock owned of record by such Person as of immediately prior to the Effective
Time, plus (ii) the number of shares of Company Common Stock issuable upon
exercise of all Options held by such Person as of immediately prior to the
Effective Time, plus (iii) the number of shares of Company Preferred Stock owned
of record by such Person as of immediately prior to the Effective Time, by (b)
the Fully Diluted Share Number (including from the calculation of Fully Diluted
Share Number all Options).

 

Section 1.4     Affiliate. “Affiliate” shall mean with respect to any Person,
any other Person directly or indirectly controlling, controlled by, or under
common control with, such Person. For the purposes of this definition,
“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, through the ownership
of more than fifty percent (50%) of the voting securities of such Person;
provided, however, Kyocera Corporation of Japan and its wholly owned
subsidiaries shall not be deemed Affiliates of Parent or Merger Subsidiary.

 

Section 1.5     Aggregate Exercise Price. “Aggregate Exercise Price” shall mean
the aggregate dollar amount that would be received by the Company as the
purchase price upon the full exercise (and not any net exercise) of all Options
outstanding immediately prior to the Effective Time.

 

Section 1.6     Aggregate Preference Amount. “Aggregate Preference Amount” shall
mean the sum of (a) the product of the Series C Preference Amount multiplied by
the aggregate number of shares of Series C Preferred Stock outstanding
immediately prior to the Effective Time; plus (b) the product of the Series E
Preference Amount multiplied by the aggregate number of shares of Series E
Preferred Stock outstanding immediately prior to the Effective Time.

 

Section 1.7     Agreement. “Agreement” shall have the meaning set forth in the
preamble to this Agreement.

 

2

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Section 1.8     Ancillary Documents. “Ancillary Documents” shall mean the Escrow
Agreement, the certificates referenced in Section 2.4(a)(iii), Section
2.4(a)(iv) and Section 2.4(b)(viii), the estoppels referenced in Section
2.4(a)(vii), the payoff and release letters referenced in Section 2.4(a)(ix),
the Certificate of Merger, the Closing Indebtedness and Net Debt Certificate,
the Closing Company Transaction Expenses Certificate, the Consideration
Spreadsheet and the Stockholder Notice.

 

Section 1.9     Basket. “Basket” means two hundred fifty thousand dollars
($250,000).

 

Section 1.10     Books and Records. “Books and Records” shall mean original or
true and complete copies of all of the books, records, files, data and
information of the Company and the Subsidiaries (including, without limitation,
customer lists, financial and accounting records, purchase orders and invoices,
sales orders and sales order log books, credit and collection records,
correspondence and miscellaneous records with respect to customers and supply
sources and all other general correspondence), in each case, whether in written
or electronic form.

 

Section 1.11     Business Day. “Business Day” shall mean any day of the year
other than: (a) any Saturday or Sunday; (b) any other day on which the banks
located in the State of South Carolina or the State of California are required
to be closed for business; or (c) September 29, 2017.

 

Section 1.12     Cancelled Shares. “Cancelled Shares” shall have the meaning set
forth in Section 3.1(a) hereof.

 

Section 1.13     Cap. “Cap” shall have the meaning set forth in Section 10.1(b)
hereof.

 

Section 1.14     CERCLA. “CERCLA” shall have the meaning set forth in Section
4.16(d) hereof.

 

Section 1.15     Certificate of Merger. “Certificate of Merger” shall have the
meaning set forth in Section 2.1(a) hereof.

 

Section 1.16     Certificate. “Certificate” shall mean a certificate that
immediately prior to the Effective Time represented one or more issued and
outstanding shares of Company Common Stock or Company Preferred Stock.

 

Section 1.17     Circular 698. “Circular 698” shall mean Guo Shui Han [2009] No.
698 – the Circular on Strengthening the Administration on Collection of
Enterprise Income Tax on Income From Equity Transfers by Non-residents, issued
by the State Administration of Taxation on December 10, 2009 and its
implementation regulations, as re-enacted, amended or replaced from time to
time.

 

Section 1.18     Closing. “Closing” shall have the meaning set forth in Section
2.3 hereof.

 

Section 1.19     Closing Company Transaction Expenses Certificate. “Closing
Company Transaction Expenses Certificate” shall have the meaning set forth in
Section 3.13 hereof.

 

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Section 1.20     Closing Date. “Closing Date” shall mean the date on which the
Closing occurs.

 

Section 1.21     Closing Indebtedness and Net Debt Certificate. “Closing
Indebtedness and Net Debt Certificate” shall have the meaning set forth in
Section 3.13 hereof.

 

Section 1.22     Closing Merger Consideration. “Closing Merger Consideration”
shall mean the Purchase Price, plus the Estimated Closing Adjustment (which may
be a negative number), minus (a) the Indemnification Escrow Amount, (b) the
Purchase Price Adjustment Escrow Amount, (c) the Stockholder Representative
Escrow Amount, (d) the Net Debt Adjustment, if any, and (e) the amount of unpaid
Company Transaction Expenses as of the Closing Date.

 

Section 1.23     Closing Per Option Merger Consideration. “Closing Per Option
Merger Consideration” shall mean (a) the Closing Merger Consideration, plus the
Aggregate Exercise Price, minus the Aggregate Preference Amount, plus the
Indemnification Escrow Amount, plus the Purchase Price Adjustment Escrow Amount,
plus the Stockholder Representative Escrow Amount, divided by (b) the Fully
Diluted Share Number.

 

Section 1.24     Closing Per Share Merger Consideration. “Closing Per Share
Merger Consideration” shall mean (a) the Closing Per Option Merger
Consideration, minus (b) the quotient of (i) the sum of the Indemnification
Escrow Amount, plus the Purchase Price Adjustment Escrow Amount, plus the
Stockholder Representative Escrow Amount, divided by (ii) the Fully Diluted
Share Number (with the calculation of such Fully Diluted Share Number excluding
any Options).

 

Section 1.25     Closing Working Capital. “Closing Working Capital” shall mean
the Working Capital of the Company as of the Closing Date.

 

Section 1.26     Closing Working Capital Statement. “Closing Working Capital
Statement” shall have the meaning set forth in Section 3.11(b)(i) hereof.

 

Section 1.27     COBRA. “COBRA” shall have the meaning set forth in Section
4.10(c) hereof.

 

Section 1.28     Code. “Code” shall mean the Internal Revenue Code of 1986, as
amended.

 

Section 1.29     Commercial Tax Agreement. “Commercial Tax Agreement” shall mean
customary commercial agreements not primarily related to Taxes that contain
agreements or arrangements relating to the apportionment, sharing, assignment or
allocation of Taxes (such as financing agreements with Tax gross-up obligations
or leases with Tax escalation provisions).

 

Section 1.30     Company. “Company” shall have the meaning set forth in the
preamble to this Agreement and, unless context otherwise requires, shall include
the Company and the Subsidiaries on a consolidated basis.

 

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Section 1.31     Company Affiliate. “Company Affiliate” shall have the meaning
set forth in Section 4.14 hereof.

 

Section 1.32     Company Board. “Company Board” shall have the meaning set forth
in the Recitals.

 

Section 1.33     Company Bylaws. “Company Bylaws” shall have the meaning set
forth in Section 4.1 hereof.

 

Section 1.34     Company Capital Stock. “Company Capital Stock” shall mean the
Company Common Stock and the Company Preferred Stock.

 

Section 1.35     Company Cash. “Company Cash” shall mean the aggregate amount of
all cash and cash equivalents of the Company and its Subsidiaries.

 

Section 1.36     Company Charter. “Company Charter” shall have the meaning set
forth in Section 4.1 hereof.

 

Section 1.37     Company Common Stock. “Company Common Stock” shall mean the
Common Stock, par value $0.001 per share, of the Company.

 

Section 1.38     Company Preferred Stock. “Company Preferred Stock” shall mean,
collectively, the Series A Preferred Stock, the Series B Preferred Stock, the
Series C Preferred Stock, the Series D Preferred Stock, the Series E Preferred
Stock and the Series F Preferred Stock.

 

Section 1.39     Company Contracts. “Company Contracts” shall have the meaning
set forth in Section 4.19(a) hereof.

 

Section 1.40     Company Disclosure Letter. “Company Disclosure Letter” shall
mean the disclosure letter prepared by the Company and attached as Schedule 1.40
to this Agreement.

 

Section 1.41     Company Indebtedness. “Company Indebtedness” shall mean all
obligations or other liabilities of the Company or any of its Subsidiaries for:
 indebtedness for money borrowed;  indebtedness evidenced by notes, debentures,
bonds or other similar debt instruments, the payment for which the Company or a
Subsidiary is responsible or liable;  reimbursements, payments or similar
obligations in respect of banker’s acceptances, surety bonds, interest rate
protection agreements, swap agreements, hedge agreements, foreign exchange
contracts or similar agreements; capital lease obligations; the deferred
purchase price of property, equipment or services (other than accounts payable
or accrued expenses in the ordinary course of business); indebtedness created or
arising under any conditional sale or other title retention agreement with
respect to property acquired; reimbursements, payments or similar obligations,
contingent or otherwise, letter of credit or similar facilities; quasi-debt
items such as off balance sheet financing arrangements, syndicated leases or
other off balance sheet liabilities owed to third parties, the purpose or effect
of which is to defer, reduce or otherwise avoid or adjust the recording of debt
expenses incurred by such Person; all obligations of the type referred to in the
foregoing clauses of this definition of other Persons for the payment of which
the Company or a Subsidiary is responsible or liable, as obligor, guarantor,
surety or otherwise, including any guarantee of such obligations or “keep-well”
arrangements, or for the payment of which the Company’s or a Subsidiary’s
property is subject to any Lien (even though the other Persons may not have
assumed or become liable for the payment of such indebtedness); and any unpaid
interest, premiums, prepayment penalties or other penalties, exit fees, other
fees and expenses, and any other amounts owing that are required to be paid by
the Company or a Subsidiary in respect of indebtedness described in clauses (i)
through (ix) above. The Company Indebtedness specifically includes the mortgage
loan with the Industrial Bank of Korea for Real Property owned by the Company or
a Subsidiary; however, such mortgage shall not be paid and satisfied at Closing
and shall remain outstanding.

 

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Section 1.42     Company Indemnified Parties. “Company Indemnified Parties”
shall have the meaning set forth in Section 11.1(b) hereof.

 

Section 1.43     Company Insurance Expense. “Company Insurance Expense” shall
have the meaning set forth in Section 7.10 hereof.

 

Section 1.44     Company Material Adverse Effect. “Company Material Adverse
Effect” shall mean any change, effect, event, occurrence or state of facts that
either, individually or in the aggregate, (a) would be (or could reasonably be
expected to be) materially adverse to the business, assets, condition (financial
or otherwise), operating results, operations or prospects of the Company or any
of its Subsidiaries, taken as a whole, or (b) hinders, delays or prevents the
consummation of the Merger and the transactions contemplated hereby by the
Company; provided, however, that “Company Material Adverse Effect” shall not
include any change, effect, event, occurrence or state of facts arising out of
or attributable to: (i) general economic or political conditions; (ii)
conditions generally affecting the industry in which the Company operates; (iii)
any changes in financial or securities markets in general; (iv) acts of war
(whether or not declared), armed hostilities or terrorism, or the escalation or
worsening thereof; (v) any action required by this Agreement, except pursuant to
Section 4.4 and Section 7.8; (vi) changes in applicable Law or GAAP; (vii) the
announcement or pendency of this Agreement or the transactions completed hereby;
(viii) the Company’s failure to meet any internal projections (in and of
itself); or (ix) an investigation of or challenge to the transactions described
herein by a Governmental Authority pursuant to any Competition Law; provided
further, however, that any change, effect, event, occurrence or state of facts
referred to in clauses (i) through (iv) immediately above shall be taken into
account in determining whether a Material Adverse Effect has occurred or could
reasonably be expected to occur to the extent that such change, effect, event,
occurrence or state of facts has a disproportionate effect on the Company
compared to other participants in the industry in which the Company conducts its
businesses.

 

Section 1.45     Company Source Code. “Company Source Code” shall have the
meaning set forth in Section 4.17(k) hereof.

 

Section 1.46     Company Stockholders. “Company Stockholders” shall mean the
holders of the Company Common Stock and the Company Preferred Stock.

 

Section 1.47     Company Stockholder Approval. “Company Stockholder Approval”
shall have the meaning set forth in Section 4.29 hereof.

 

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Section 1.48     Company Stock Plan. “Company Stock Plan” shall mean the
Ethertronics, Inc. 2000 Stock Plan, adopted August 9, 2000, as amended.

 

Section 1.49     Company Transaction Expenses. “Company Transaction Expenses”
shall mean all fees and expenses incurred by the Company and any Subsidiary at
or prior to the Closing in connection with the preparation, negotiation and
execution of this Agreement and the Ancillary Documents, and the performance and
consummation of the Merger and the other transactions contemplated hereby and
thereby, including, but not limited to, (a) all investment banking, legal,
accounting and other professional fees, costs and expenses incurred on or before
the Closing Date and payable by the Company or any Subsidiary, (b) any amounts
payable by the Company or any Subsidiary to any third party in connection with
obtaining any consent, notice or approval required to be obtained by the Company
or any Subsidiary in connection with the consummation of the Merger (including
any amount paid or payable by the Company or any Subsidiary pursuant to Section
7.8(g)), (c) the Company Insurance Expense, (d) all amounts (plus any payroll
Taxes or any Taxes required to be paid by the Company or any Subsidiary with
respect thereto) payable as a result of or in connection with the consummation
of the Merger by the Company or any Subsidiary, contemporaneously with or after
the Closing Date under any “change of control,” retention, termination,
compensation, severance or other similar arrangements to which the Company or
any Subsidiary is a party, (e) the Tail Policy premium, (f) the portion of
Transfer Taxes borne by the Company Stockholders pursuant to Section 10.6, and
(g) all amounts (plus any payroll Taxes or any Taxes required to be paid by the
Company or any Subsidiary with respect thereto) payable to the ten employees
listed in Section 4.2(b) of the Company Disclosure Letter in lieu of the
“committed options” that otherwise would have been issued to such employees but
for the Merger.

 

Section 1.50     Company Warrants. “Company Warrants” shall mean, collectively,
the Series B Warrants, the Series C Warrants, the Series D Warrants and the
Series F Warrants.

 

Section 1.51     Competition Law. “Competition Law” shall mean statutes, rules,
regulations, orders, decrees, administrative guidance and judicial doctrines and
other laws inside and outside the United States that are designed or intended to
regulate mergers or other business combinations (requiring pre-closing or
post-closing authorizations, consents or judgments) or that are designed or
intended to prohibit, restrict or regulate actions having the purpose or effect
of monopolization or restraint of trade.

 

Section 1.52     Consideration Spreadsheet. “Consideration Spreadsheet” shall
have the meaning set forth in Section 3.12(a) hereof.

 

Section 1.53     Contractors. “Contractors” shall have the meaning set forth in
Section 4.10(l) hereof.

 

Section 1.54     Contracts. “Contracts” shall mean all contracts, agreements,
leases, licenses and binding commitments, whether written or oral (and all
amendments, side letters, modifications and supplements thereto).

 

Section 1.55     Deeds. “Deeds” shall have the meaning set forth in Section
4.7(b) hereof.

 

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Section 1.56     Defect. “Defect” shall mean a material defect in design,
manufacture, processing of a Product, including any dangerous propensity
associated with any reasonably foreseeable use of a Product, or the failure to
warn of the existence of any defect, or dangerous propensity.

 

Section 1.57     DGCL. “DGCL” shall have the meaning set forth in the Recitals.

 

Section 1.58     Disputed Amounts. “Disputed Amounts” shall have the meaning set
forth in Section 3.11(c)(iii) hereof.

 

Section 1.59     Dissenting Shares. “Dissenting Shares” shall have the meaning
set forth in Section 3.4 hereof.

 

Section 1.60     Effective Time. “Effective Time” shall have the meaning set
forth in Section 2.2 hereof.

 

Section 1.61     Employee. “Employee” shall have the meaning set forth in
Section 4.11(c) hereof.

 

Section 1.62     Employee Benefit Plan. “Employee Benefit Plan” shall mean each
pension, retirement, savings and profit sharing, per diem, bonus, jubilee pay,
incentive, deferred compensation, severance pay, welfare or other employee
benefit plan, fund or program, including without limitation any “employee
benefit plan” within the meaning of Section 3(3) of ERISA, and any stock
purchase, stock option or other equity based compensation plans, agreement or
arrangement, supplemental savings and profit sharing plan, retention plan,
nonqualified deferred compensation plan, change in control agreement, vacation,
employment, independent contractor, disability, hospitalization, sickness,
death, medical insurance, dental insurance, tuition assistance, life insurance,
fringe benefit and any other employee benefit plan (whether provided on a funded
or unfunded basis, or through insurance or otherwise), agreement, program,
policy, trust, fund, contract or arrangement contributed to, required to be
contributed to, or maintained or sponsored by, any of, or on behalf of, the
Company, any Subsidiary or any of their ERISA Affiliates, or under which any of
them has or reasonably could be expected to have any obligations (other than
obligations to make current wage or salary payments or sales commissions
terminable on notice of 30 days or less) or liabilities, actual or contingent,
by guaranty or otherwise, whether or not legally binding, and whether or not
subject to ERISA, covering present or former employees, independent contractors,
leased employees, officers or directors of the Company, any Subsidiary or any
ERISA Affiliate (or any spouse or dependent or beneficiary thereof).

 

Section 1.63     Environmental Claim. “Environmental Claim” shall mean any and
all administrative, regulatory or judicial actions, suits, orders, demands,
directives, claims, liens, investigations, proceedings or notices of
noncompliance or violation by or from any Person alleging liability of whatever
kind or nature (including liability or responsibility for the costs of
enforcement proceedings, investigations, cleanup, governmental response, removal
or remediation, natural resources damages, property damages, personal injuries,
medical monitoring, penalties, contribution, indemnification and injunctive
relief) arising out of, based on or resulting from (a) the presence or Release
of, or exposure to, any Hazardous Substances at any location, or (b) the failure
to comply with any Environmental Law.

 

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Section 1.64     Environmental Laws. “Environmental Laws” shall mean any
applicable common law or federal, state or local, domestic or foreign, statutes,
laws, regulations, ordinances, rules, codes, enforceable obligations,
agreements, orders, decrees, judgments, Permits or injunctions issued,
promulgated or entered into by any Governmental Authority, in each case,
relating to protection of the environment, natural resources or human health, or
to the use, management, disposal, Release or threatened Release of Hazardous
Substances.

 

Section 1.65     ERISA. “ERISA” shall mean the Employee Retirement Income
Security Act of 1974, as amended from time to time, and all rules and
regulations promulgated from time to time pursuant thereto.

 

Section 1.66     ERISA Affiliate. “ERISA Affiliate” shall mean each entity,
trade or business that is, at the relevant time, a member of a controlled group
or affiliated service group of which the Company or any Subsidiary is a member
or that is treated as a single employer with the Company or any Subsidiary under
Section 414(b), 414(c), 414(m) or 414(o) of the Code or Section 4001(a)(14) of
ERISA.

 

Section 1.67     Escrow Agent. “Escrow Agent” shall mean Branch Banking and
Trust Company, a North Carolina banking corporation.

 

Section 1.68     Escrow Agreement. “Escrow Agreement” shall mean the Escrow
Agreement to be entered into by Parent, Stockholder Representative and the
Escrow Agent at the Closing, substantially in the form of Exhibit A.

 

Section 1.69     Escrow Funds. “Escrow Funds” shall have the meaning set forth
in Section 3.6(c) hereof.

 

Section 1.70     Estimated Closing Adjustment. “Estimated Closing Adjustment”
shall have the meaning set forth in Section 3.11(a)(iii) hereof.

 

Section 1.71     Estimated Closing Working Capital. “Estimated Closing Working
Capital” shall have the meaning set forth in Section 3.11(a)(i) hereof.

 

Section 1.72     Estimated Closing Working Capital Statement. “Estimated Closing
Working Capital Statement” shall have the meaning set forth in Section
3.11(a)(i) hereof.

 

Section 1.73     Exchange Agent. “Exchange Agent” shall have the meaning set
forth in Section 3.5(b) hereof.

 

Section 1.74     Extended Termination Date. “Extended Termination Date” shall
have the meaning set forth in Section 9.1(b)(i) hereof.

 

Section 1.75     FCPA. “FCPA” shall have the meaning set forth in Section
4.13(c)(iii) hereof.

 

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Section 1.76     Final Order. “Final Order” shall have the meaning set forth in
Section 9.1(b)(i) hereof.

 

Section 1.77     Financial Statements. “Financial Statements” shall have the
meaning set forth in Section 4.5 hereof.

 

Section 1.78     FLSA. “FLSA” shall have the meaning set forth in Section
4.11(b) hereof.

 

Section 1.79     Foreign Benefit Plan. “Foreign Benefit Plan” shall have the
meaning set forth in Section 4.10(j) hereof.

 

Section 1.80     Fraud. “Fraud” shall mean actual fraud under the Law of the
State of Delaware, which for clarity, includes the element of scienter
(knowledge of falsity).

 

Section 1.81     Fully Diluted Share Number. “Fully Diluted Share Number” shall
mean, without duplication, (a) the aggregate number of shares of Company Common
Stock issued and outstanding immediately prior to the Effective Time (other than
shares which are to be Cancelled Shares in accordance with Section 3.1(a)), plus
(b) the aggregate number of shares of Company Preferred Stock issued and
outstanding immediately prior to the Effective Time (other than shares which are
to be Cancelled Shares in accordance with Section 3.1(a)), plus (c) the
aggregate number of shares of Company Common Stock issuable upon the exercise in
full of all Options (whether vested or unvested) outstanding immediately prior
to the Effective Time.

 

Section 1.82     Fundamental Representations. “Fundamental Representations”
shall have the meaning set forth in Section 11.1(a) hereof.

 

Section 1.83     GAAP. “GAAP” shall mean generally accepted accounting
principles as in effect in the United States of America at the time of the
preparation of the subject financial statement.

 

Section 1.84     Governmental Authority. “Governmental Authority” shall mean the
United States of America, any other nation or any state or territory or
subdivision thereof, or any municipality or locality, and any agency or
instrumentality of any of the foregoing.

 

Section 1.85     Hazardous Substances. “Hazardous Substances” shall mean any
mold or fungi, explosive, radioactive, toxic or hazardous substances or
materials (including asbestos or asbestos-containing materials, polychlorinated
biphenyls, petroleum and petroleum products), and any other substances or
materials defined as, or included in the definition of, “hazardous substances”,
“hazardous wastes”, “hazardous materials” or “toxic substances” under
Environmental Laws.

 

Section 1.86     HSR Act. “HSR Act” shall mean the Hart-Scott-Rodino Antitrust
Improvements Act of 1976, as amended, and the rules and regulations promulgated
thereunder.

 

Section 1.87     Improvements. “Improvements” shall have the meaning set forth
in Section 4.7(b) hereof.

 

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Section 1.88     Income Tax Return. “Income Tax Return” shall mean any Tax
Return with respect to any United States federal, state, local or non-U.S. Tax
that, in whole or in part, is based on, measured by or calculated by reference
to income, profits, receipts or gains.

 

Section 1.89     Indemnification Escrow Amount. “Indemnification Escrow Amount”
shall mean $750,000.

 

Section 1.90     Indemnification Escrow Fund. “Indemnification Escrow Fund”
shall have the meaning set forth in Section 3.6(a) hereof.

 

Section 1.91     Indemnified Parties. “Indemnified Parties” shall have the
meaning set forth in Section 11.1(b) hereof.

 

Section 1.92     Indemnifying Party. “Indemnifying Party” shall have the meaning
set forth in Section 11.3(a) hereof.

 

Section 1.93     Independent Accountant. “Independent Accountant” shall have the
meaning set forth in Section 3.11(c)(iii) hereof.

 

Section 1.94     Intellectual Property. “Intellectual Property” shall mean all
United States and non-United States: (a) patents and patent applications whether
or not patents are issued on such applications and whether or not such patents
or applications are modified, withdrawn or resubmitted; (b) registered and
unregistered trade names, trade dress, trademarks, service names and service
marks (and applications for registration of the same) and all goodwill
associated therewith; (c) copyrights and copyright registrations (and
applications for the same) and works of original authorship (whether or not the
copyright has been registered); (d) trade secrets, know-how, formulae,
compilations, devices, methods, techniques or processes, and confidential or
proprietary information; (e) Inventions, processes and designs (whether or not
patentable or reduced to practice), including, without limitation, all notes,
journals or other compilations of data generated in the invention or development
process; (f) any computer software program source code, object code, data and
documentation; (g) domain names or uniform resource locators used in connection
with any global computer or electronic network (including, without limitation,
the Internet and the World Wide Web) together with all translations,
adaptations, derivations, and combinations thereof and including all goodwill
associated therewith, all applications, registrations, and renewals in
connection therewith, and all source code, object code, data and documentation
relating thereto; and (h) all other intellectual property rights associated with
the foregoing.

 

Section 1.95     Interim Balance Sheet. “Interim Balance Sheet” shall have the
meaning set forth in Section 4.5 hereof.

 

Section 1.96     Interim Financial Statements. “Interim Financial Statements”
shall have the meaning set forth in Section 4.5 hereof.

 

Section 1.97     Inventions. “Inventions” shall have the meaning set forth in
Section 4.17(g) hereof.

 

Section 1.98     IRS. “IRS” shall mean the Internal Revenue Service.

 

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Section 1.99     Knowledge of the Company. “Knowledge of the Company” shall mean
the actual knowledge, after due inquiry, of Laurent Desclos, Sebastian Rowson,
Vahid Manian, Rick Johnson, Sung-Ki (SK) Jung, Olivier Pajona and Rozi
Roufoogaran.

 

Section 1.100     Labor Laws. “Labor Laws” shall have the meaning set forth in
Section 4.11(b) hereof.

 

Section 1.101     Law. “Law” shall mean any federal, state, foreign,
supranational, provincial, local or other law, statute, act, ordinance or other
governmental requirement of any kind, and the rules, regulations and orders
promulgated thereunder.

 

Section 1.102     Leased Real Property. “Leased Real Property” shall have the
meaning set forth in Section 4.7(b) hereof.

 

Section 1.103     Letter of Transmittal. “Letter of Transmittal” shall have the
meaning set forth in Section 3.5(c) hereof.

 

Section 1.104     License Agreements. “License Agreements” shall have the
meaning set forth in Section 4.17(a) hereof.

 

Section 1.105     Lien. “Lien” shall mean any mortgage, lien (including any Tax
Lien), pledge, charge, adverse right or claim, security interest or encumbrance
(excluding non-exclusive licenses to the Company’s Intellectual Property granted
in the ordinary course of business) of any kind.

 

Section 1.106     Loss. “Loss” shall have the meaning set forth in Section
11.1(a) hereof.

 

Section 1.107     Majority Holders. “Majority Holders” shall have the meaning
set forth in Section 12.1(c) hereof.

 

Section 1.108     Merger. “Merger” shall have the meaning set forth in the
recitals to this Agreement.

 

Section 1.109     Merger Consideration. “Merger Consideration” shall mean the
Closing Merger Consideration, together with those portions of the Escrow Funds
(in the case of the Company Stockholders) and the Post-Closing Adjustment (if
any) (in the case of the Company Stockholders and the Optionholders) that the
Company Stockholders and the Optionholders become entitled to receive pursuant
to the terms of this Agreement and the Escrow Agreement.

 

Section 1.110     Merger Subsidiary. “Merger Subsidiary” shall have the meaning
set forth in the preamble to this Agreement.

 

Section 1.111     Merger Subsidiary Common Stock. “Merger Subsidiary Common
Stock” shall mean the common stock, $0.001 par value per share, of Merger
Subsidiary.

 

Section 1.112     Net Debt. “Net Debt” shall mean the greater of (i) zero and
(ii) Company Indebtedness minus Company Cash as of the Closing Date.

 

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Section 1.113     Net Debt Adjustment. “Net Debt Adjustment” shall mean the
amount by which Net Debt exceeds $8,000,000.

 

Section 1.114     OFAC. “OFAC” shall have the meaning set forth in Section
4.13(e) hereof.

 

Section 1.115     Open Source Materials. “Open Source Materials” shall mean all
software that is distributed as “free software”, “open source software” or under
a similar licensing or distribution model, including the GNU General Purpose
License (GPL), GNU Lesser General Public License (LGPL), Mozilla Public License
(MPL), or any other license described by the Open Source Initiative as set forth
on www.opensource.org.

 

Section 1.116     Option. “Option” shall mean any option (whether vested or
unvested) to purchase Company Common Stock granted under the Company Stock Plan
and outstanding as of immediately prior to the Effective Time.

 

Section 1.117     Optionholder. “Optionholder” shall mean the holder of the
respective Option.

 

Section 1.118     Owned Real Property. “Owned Real Property” shall have the
meaning set forth in Section 4.7(b) hereof.

 

Section 1.119     Parent. “Parent” shall have the meaning set forth in the
preamble to this Agreement.

 

Section 1.120     Parent Indemnified Parties. “Parent Indemnified Parties” shall
have the meaning set forth in Section 11.1(a) hereof.

 

Section 1.121     Party; Parties. “Party” shall mean any party to this
Agreement, and “Parties” shall mean all the parties to this Agreement.

 

Section 1.122     Pending IP. “Pending IP” shall have the meaning set forth in
Section 4.17(a) hereof.

 

Section 1.123     Permits. “Permits” shall mean all permits, licenses,
variances, exemptions, orders, registrations, consents and approvals and
governmental authorizations of Government Authorities.

 

Section 1.124     Permitted Liens. “Permitted Liens” shall have the meaning set
forth in Section 4.7(f) hereof.

 

Section 1.125     Person. “Person” shall mean any individual, corporation,
partnership, limited liability company, association, trust, unincorporated
entity or other legal entity.

 

Section 1.126     Phase I Environmental Site Assessment. “Phase I Environmental
Site Assessment” shall have the meaning set forth in Section 7.9 hereof.

 

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Section 1.127     Post-Closing Adjustment. “Post-Closing Adjustment” shall have
the meaning set forth in Section 3.11(b)(ii) hereof.

 

Section 1.128     Post-Closing Tax Period. “Post-Closing Tax Period” shall mean
any Tax period beginning after the Closing Date and that portion of any Straddle
Period beginning after the Closing Date.

 

Section 1.129     Pre-Closing Income Tax Return. “Pre-Closing Income Tax Return”
shall have the meaning set forth in Section 10.4(b)(ii) hereof.

 

Section 1.130     Pre-Closing Other Tax Return. “Pre-Closing Other Tax Return”
shall have the meaning set forth in Section 10.4(b)(iii) hereof.

 

Section 1.131     Pre-Closing Tax Period. “Pre-Closing Tax Period” shall mean
any Tax period ending on or before the Closing Date and that portion of any
Straddle Period ending on the Closing Date.

 

Section 1.132     Pre-Closing Tax Return. “Pre-Closing Tax Return” shall have
the meaning set forth in Section 10.4(b)(iv) hereof.

 

Section 1.133     Proceeding. “Proceeding” shall mean any lawsuit, arbitration,
audit or other similar proceeding (whether civil, criminal, administrative or
investigative) commenced, brought, conducted, or heard by or before any
Governmental Authority.

 

Section 1.134     Product. “Product” shall mean any product designed,
manufactured, shipped, sold, and/or distributed by or on behalf of the Company
or any Subsidiary, including any product sold by the Company or any Subsidiary
as the distributor, agent, or pursuant to any other contractual relationship.

 

Section 1.135     Pro Rata Share. “Pro Rata Share” shall mean, with respect to
any Company Stockholder, such Person’s ownership interest in the Company as of
immediately prior to the Effective Time, determined by dividing (a) the sum of
(i) the number of shares of Company Common Stock owned of record by such Person
as of immediately prior to the Effective Time, plus (ii) the number of shares of
Company Preferred Stock owned of record by such Person as of immediately prior
to the Effective Time, by (b) the Fully Diluted Share Number (excluding from the
calculation of Fully Diluted Share Number all Options).

 

Section 1.136     Purchase Price. “Purchase Price” shall mean $142,000,000.

 

Section 1.137     Purchase Price Adjustment Escrow Amount. “Purchase Price
Adjustment Escrow Amount” shall mean $1,500,000.

 

Section 1.138     Purchase Price Adjustment Escrow Fund. “Purchase Price
Adjustment Escrow Fund” shall have the meaning set forth in Section 3.6(b)
hereof.

 

Section 1.139     Qualified Plans. “Qualified Plans” shall have the meaning set
forth in Section 4.10(b) hereof.

 

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Section 1.140     Real Property. “Real Property” shall have the meaning set
forth in Section 4.7(b) hereof.

 

Section 1.141     Real Property Leases. “Real Property Leases” shall have the
meaning set forth in Section 4.7(b) hereof.

 

Section 1.142     Registered IP. “Registered IP” shall have the meaning set
forth in Section 4.17(a) hereof.

 

Section 1.143     Release. “Release” shall mean any release, spilling, leaking,
pumping, pouring, discharging, emitting, emptying, injecting, dumping, or
disposing into the environment.

 

Section 1.144     Required Consents. “Required Consents” shall mean the
consents, approvals and notices listed on Schedule 1.144.

 

Section 1.145     Representations and Warranties Insurance Policy.
“Representations and Warranties Insurance Policy” shall have the meaning set
forth in Section 7.10 hereof.

 

Section 1.146     Representative Losses. “Representative Losses” shall have the
meaning set forth in Section 12.1(d) hereof.

 

Section 1.147     Resolution Period. “Resolution Period” shall have the meaning
set forth in Section 3.11(c)(ii) hereof.

 

Section 1.148     Restricted Nations. “Restricted Nations” shall have the
meaning set forth in Section 4.13(e) hereof.

 

Section 1.149     Review Period. “Review Period” shall have the meaning set
forth in Section 3.11(c)(i) hereof.

 

Section 1.150     Section 409A Plan. “Section 409A Plan” shall have the meaning
set forth in Section 4.10(d) hereof.

 

Section 1.151     Series A Preferred Stock. “Series A Preferred Stock” shall
mean the Company’s Series A Preferred Stock, par value $0.001 per share.

 

Section 1.152     Series B Preferred Stock. “Series B Preferred Stock” shall
mean the Company’s Series B Preferred Stock, par value $0.001 per share.

 

Section 1.153     Series C Preference Amount. “Series C Preference Amount” shall
mean $2.25.

 

Section 1.154     Series C Preferred Stock. “Series C Preferred Stock” shall
mean the Company’s Series C Preferred Stock, par value $0.001 per share.

 

Section 1.155     Series D Preferred Stock. “Series D Preferred Stock” shall
mean the Company’s Series D Preferred Stock, par value $0.001 per share.

 

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Section 1.156     Series E Preference Amount. “Series E Preference Amount” shall
mean $2.552.

 

Section 1.157     Series E Preferred Stock. “Series E Preferred Stock” shall
mean the Company’s Series E Preferred Stock, par value $0.001 per share.

 

Section 1.158     Series F Preferred Stock. “Series F Preferred Stock” shall
mean the Company’s Series F Preferred Stock, par value $0.001 per share.

 

Section 1.159     Series B Warrant. “Series B Warrant” shall mean a warrant to
purchase shares of Series B Preferred Stock.

 

Section 1.160     Series C Warrant. “Series C Warrant” shall mean a warrant to
purchase shares of Series C Preferred Stock.

 

Section 1.161     Series D Warrant. “Series D Warrant” shall mean a warrant to
purchase shares of Series D Preferred Stock.

 

Section 1.162     Series F Warrant. “Series F Warrant” shall mean a warrant to
purchase shares of Series F Preferred Stock.

 

Section 1.163     Shares. “Shares” shall mean shares of Company Capital Stock.

 

Section 1.164     Stockholder Consent. “Stockholder Consent” shall have the
meaning set forth in Section 7.6(a) hereof.

 

Section 1.165     Stockholder Notice. “Stockholder Notice” shall have the
meaning set forth in Section 7.6(b) hereof.

 

Section 1.166     Stockholder Representative. “Stockholder Representative” shall
have the meaning set forth in the preamble to this Agreement.

 

Section 1.167     Stockholder Representative Escrow Amount. “Stockholder
Representative Escrow Amount” shall mean $100,000.

 

Section 1.168     Stockholder Representative Escrow Fund. “Stockholder
Representative Escrow Fund” shall have the meaning set forth in Section 3.6(c)
hereof.

 

Section 1.169     Straddle Period. “Straddle Period” shall mean any Tax period
beginning before or on and ending after the Closing Date.

 

Section 1.170     Subsidiaries. “Subsidiaries” shall mean the companies and
branches listed on Section 1.170 of the Company Disclosure Letter.

 

Section 1.171     Statement of Objections. “Statement of Objections” shall have
the meaning set forth in Section 3.11(c)(ii) hereof.

 

Section 1.172     Surviving Corporation. “Surviving Corporation” shall have the
meaning set forth in Section 2.1(a) hereof.

 

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Section 1.173     Target Working Capital. “Target Working Capital” shall have
the meaning set forth in Section 3.11(a)(iii) hereof.

 

Section 1.174     Tax Authority. “Tax Authority” shall mean any Governmental
Authority competent to impose any liability in respect of Taxation or
responsible for the administration, determination and/or collection of Taxation
or enforcement of any Law in relation to Taxation.

 

Section 1.175     Taxes. “Taxes” (and, with correlative meaning, “Taxes” and
“taxable”) shall mean any and all taxes, including any net income, alternative
or add-on minimum, gross income, gross receipts, sales, use, ad valorem, value
added, transfer, franchise, profits, license, registration, recording,
documentary, conveyancing, gains, withholding, payroll, employment, excise,
severance, stamp, occupation, premium, real property, personal property,
unclaimed property, escheat, environmental or windfall profit, custom duty, or
other tax, governmental fee or other like assessment or charge of any kind
whatsoever in the nature of a tax, together with any interest, penalty, addition
to tax or additional amount imposed by any Taxing Authority.

 

Section 1.176     Tax Lien. “Tax Lien” shall mean any right by a Taxing
Authority to take possession of any asset or property to satisfy an outstanding
liability for unpaid Taxes by the Company and any Company Affiliate.

 

Section 1.177     Tax Return. “Tax Return” shall mean any return, declaration,
report, election, disclosure, form, estimated return and information statement
relating to Taxes (including schedules or other attachments thereto, amendments
thereof, or any related or supporting information) filed or required to be filed
with a Governmental Authority.

 

Section 1.178     Third-Party Claim. “Third-Party Claim” shall have the meaning
set forth in Section 11.3(b) hereof.

 

Section 1.179     Undisputed Amounts. “Undisputed Amounts” shall have the
meaning set forth in Section 3.11(c)(iii) hereof.

 

Section 1.180     Unregistered IP. “Unregistered IP” shall have the meaning set
forth in Section 4.17(a) hereof.

 

Section 1.181     Walk-Away Date. “Walk-Away Date” shall have the meaning set
forth in Section 9.1(b)(i) hereof.

 

Section 1.182     Waived 280G Benefits. “Waived 280G Benefits” shall have the
meaning set forth in Section 7.14 hereof.

 

Section 1.183     Warrantholder. “Warrantholder” shall mean a holder of a
Company Warrant.

 

Section 1.184     Year-End Financial Statements. “Year-End Financial Statements”
shall have the meaning set forth in Section 4.5 hereof.

 

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Article II

THE MERGER; CLOSING; CLOSING DELIVERABLES

 

Section 2.1     The Merger.

 

(a)     Immediately prior to the Effective Time, the Company and Merger
Subsidiary shall (i) execute and deliver a certificate of merger, substantially
in the form of Exhibit B hereto (the “Certificate of Merger”), which shall be
filed with the Secretary of State of the State of Delaware in accordance with
the DGCL and (ii) make all other filings and recordings required under the DGCL
in connection with the Merger. Subject to the terms and conditions of this
Agreement, at the Effective Time, Merger Subsidiary shall be merged with and
into the Company in accordance with the provisions of, and with the effects
provided in, the DGCL. As a result of the Merger, the separate corporate
existence of Merger Subsidiary shall cease and the Company shall continue as the
surviving corporation (the “Surviving Corporation”) following the Merger and
shall continue to be governed by the Laws of the State of Delaware.

 

(b)     At the Effective Time, the effect of the Merger shall be as provided in
this Agreement and in the applicable provisions of the DGCL. Without limiting
the generality of the foregoing, and subject thereto, at the Effective Time all
the property, assets, rights, privileges, immunities, powers, franchises,
licenses and authority of the Company and Merger Subsidiary shall vest in the
Surviving Corporation, and all debts, liabilities, obligations, restrictions,
disabilities and duties of the Company and Merger Subsidiary shall become the
debts, liabilities, obligations, restrictions, disabilities and duties of the
Surviving Corporation, all as provided in the DGCL and the other applicable Laws
of the State of Delaware.

 

(c)     If at any time after the Effective Time, the Surviving Corporation shall
consider or be advised that any further assignments or assurances in law or
otherwise are necessary or desirable to vest, perfect or confirm, of record or
otherwise, in the Surviving Corporation, all rights, title and interests in all
real estate and other property and assets and all privileges, rights,
immunities, powers and franchises of the Company or Merger Subsidiary, then the
Surviving Corporation and its proper officers and directors, in the name and on
behalf of the Company or Merger Subsidiary, shall execute and deliver all such
proper deeds, assignments and assurances in law and do all things necessary and
proper to vest, perfect or confirm title to such assets or rights in the
Surviving Corporation and otherwise to carry out the purpose of this Agreement,
and the proper officers and directors of the Surviving Corporation are fully
authorized in the name of the Company or Merger Subsidiary or otherwise to take
any and all such action.

 

Section 2.2     Effective Time. The Merger shall become effective (a) upon
filing of the Certificate of Merger with the Secretary of State of the State of
Delaware on the Closing Date or (b) at such other time as is set forth in the
Certificate of Merger (the “Effective Time”).

 

Section 2.3     Time and Place of Closing. Subject to the satisfaction or waiver
of all of the conditions to closing contained in Article VIII, the closing of
the transactions contemplated by this Agreement shall take place at a time and
on a date mutually agreed upon by the Parties hereto; provided, however, that
such date shall be no later than the second Business Day following the date on
which all of the conditions to the obligations of the Parties set forth in
Article VIII (other than those to be satisfied at the Closing) have been
satisfied or waived as provided therein (the “Closing”). The Closing shall take
place at the offices of Parent, 1 AVX Boulevard, Fountain Inn, SC 29644.

 

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Section 2.4     Closing Deliverables.

 

(a)     At or prior to the Closing, the Company shall deliver to Parent and
Merger Subsidiary the following:

 

(i)     the Escrow Agreement, dated as of the Closing Date and duly executed by
Stockholder Representative;

 

(ii)     resignations of the directors and officers of the Company and the
Subsidiaries pursuant to Section 7.7;

 

(iii)     a certificate, dated the Closing Date and duly executed by the
Company’s Chief Executive Officer or Chief Financial Officer, certifying to the
effect that the conditions set forth in Section 8.2(a), Section 8.2(b), Section
8.2(c) and Section 8.2(d) have been satisfied;

 

(iv)     a certificate of the Secretary or an Assistant Secretary (or equivalent
officer) of the Company certifying (A) that attached thereto are true and
complete copies of (1) the Company Charter, Company Bylaws and the equivalent
organizational documents of each Subsidiary, (2) all resolutions adopted by the
Company Board authorizing the execution, delivery and performance of this
Agreement and the Ancillary Documents and the consummation of the transactions
contemplated hereby and thereby and (3) the Stockholder Consent, (B) that all
such resolutions and the Stockholder Consent are in full force and effect and
are all the resolutions adopted in connection with the transactions contemplated
hereby and thereby, and (C) as to the names and signatures of the officers of
the Company authorized to sign this Agreement, the Ancillary Documents and the
other documents to be delivered hereunder and thereunder;

 

(v)     for the Company and each Subsidiary, a good standing certificate (or its
equivalent) from the secretary of state or similar Governmental Authority of the
jurisdiction under the Laws in which the Company and such Subsidiary is
organized;

 

(vi)     copies of all Required Consents;

 

(vii)     an estoppel, in form and substance acceptable to Parent, duly executed
by each landlord under a Real Property Lease for property in the U.S. (and the
Company will use its commercially reasonable efforts to obtain a such an
estoppel executed by each landlord under Real Property Leases for property
outside the U.S., it being understand that the delivery of such foreign
estoppels shall not be a required delivery at Closing);

 

(viii)     an affidavit pursuant to Section 897 of the Code certifying that the
Company is not and has not been a United States real property holding
corporation dated as of the Closing Date and in form and substance required
under Treasury Regulations Section 1.897-2(h), together with evidence reasonably
satisfactory to Parent that Parent may provide or cause to be provided notice to
the IRS in accordance with the provisions of Treasury Regulations
Section 1.897-2(h)(2);

 

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(ix)     a payoff and release letter, in form and substance acceptable to
Parent, from each holder of Company Indebtedness identified in the Closing
Indebtedness and Net Debt Certificate, which payoff letter (i) sets forth the
aggregate amount, including all principal, interest, prepayment penalties and
other fees and amounts, to be paid as of the Closing Date, to satisfy in full
all of the Company’s or Subsidiary’s obligations to such holder with respect to
such Company Indebtedness; and (ii) releases all Liens on assets of the Company
or the Subsidiaries securing such Company Indebtedness and authorizes Parent or
the Company to take all necessary actions and to file all requisite termination
statements to effect such releases; provided; however, that no payoff and
release letter will be required with respect to the mortgage loan with the
Industrial Bank of Korea for Real Property owned by the Company or a Subsidiary;

 

(x)     a restrictive covenant agreement between the Company and each of Laurent
Desclos, Rick Johnson, Sebastian Rowlsen and Vahid Manian, each duly executed by
the parties thereto and in substantially the form attached as Exhibit F (the
“Restrictive Covenant Agreement”);

 

(xi)     a release agreement, in form and substance acceptable to Parent, from
each employee listed in Section 4.2(b) of the Company Disclosure Letter in
return for a cash payment in lieu of a “committed option”; and

 

(xii)     such other documents or instruments as Parent reasonably requests and
are reasonably necessary to consummate the transactions contemplated by this
Agreement.

 

(b)     At the Closing, Parent shall deliver to the Company (or such other
Person as may be specified herein) the following:

 

(i)     the Escrow Agreement duly executed by Parent;

 

(ii)     a certificate, dated the Closing Date and duly executed by a senior
officer of Parent, certifying to the effect that the conditions set forth in
Section 8.3(a) and Section 8.3(b) have been satisfied;

 

(iii)     payment to the Exchange Agent by wire transfer of immediately
available funds an amount equal to the aggregate Closing Merger Consideration
payable pursuant to Section 3.1 in exchange for Shares and payable pursuant to
Section 3.2(a) in exchange for cancellation of Options held by Optionholders who
are not current employees of the Company or any Subsidiary;

 

(iv)     payment to the Company or its designee payroll service provider by wire
transfer of immediately available funds an amount equal to the aggregate Closing
Merger Consideration payable pursuant to Section 3.2(a) in exchange for
cancellation of Options held by Optionholders who are current employees of the
Company or any Subsidiary;

 

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(v)     payment to the Escrow Agent by wire transfer of immediately available
funds the Indemnification Escrow Amount, the Purchase Price Adjustment Escrow
Amount and the Stockholder Representative Escrow Amount as set forth in Section
3.6;

 

(vi)     payment by wire transfer of immediately available funds to third
parties of that amount of money due and owing from the Company and the
Subsidiaries to such third parties as Company Transaction Expenses as set forth
on the Closing Company Transaction Expenses Certificate;

 

(vii)     payment to holders of outstanding Company Indebtedness, if any, by
wire transfer of immediately available funds that amount of money due and owing
from the Company or any Subsidiary to such holder of outstanding Company
Indebtedness as set forth on the Closing Indebtedness and Net Debt Certificate;

 

(viii)     a certificate of the Secretary or an Assistant Secretary of Parent
certifying (A) that attached thereto are true and complete copies of all
resolutions adopted by the board of directors of Parent and Merger Subsidiary
authorizing the execution, delivery and performance of this Agreement and the
Ancillary Documents and the consummation of the transactions contemplated hereby
and thereby, and that all such resolutions are in full force and effect and are
all the resolutions adopted in connection with the transactions contemplated
hereby and thereby, and (B) the names and signatures of the officers of Parent
and Merger Subsidiary authorized to sign this Agreement, the Ancillary Documents
and the other documents to be delivered hereunder and thereunder; and

 

(ix)     such other documents or instruments as the Company reasonably requests
and are reasonably necessary to consummate the transactions contemplated by this
Agreement.

 

Section 2.5     Certificate of Incorporation and Bylaws. At the Effective Time,
(a) the certificate of incorporation of Merger Subsidiary as in effect
immediately prior to the Effective Time shall be the certificate of
incorporation of the Surviving Corporation until thereafter amended in
accordance with the terms thereof or as provided by applicable Law, and (b) the
bylaws of Merger Subsidiary as in effect immediately prior to the Effective Time
shall be the bylaws of the Surviving Corporation until thereafter amended in
accordance with the terms thereof, the certificate of incorporation of the
Surviving Corporation or as provided by applicable Law; provided, however, in
each case, that the name of the corporation set forth therein shall be changed
to “AVX Antenna, Inc.”

 

Section 2.6     Name of the Surviving Corporation. The name of the Surviving
Corporation shall be “AVX Antenna, Inc.”

 

Section 2.7     Directors of the Surviving Corporation. The directors of the
Surviving Corporation shall be as set forth on Schedule 2.7, each to hold office
from the Effective Time in accordance with the certificate of incorporation and
bylaws of the Surviving Corporation and until his or her earlier death,
resignation or removal in accordance with the certificate of incorporation and
bylaws of the Surviving Corporation.

 

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Section 2.8     Officers of the Surviving Corporation. The officers of the
Surviving Corporation shall be as set forth on Schedule 2.8, each to hold office
from the Effective Time in accordance with the certificate of incorporation and
bylaws of the Surviving Corporation and until his or her earlier death,
resignation or removal in accordance with the certificate of incorporation and
bylaws of the Surviving Corporation.

 

Article III

EFFECT OF THE MERGER ON CAPITAL STOCK

 

Section 3.1     Effect on Capital Stock. As of the Effective Time, by virtue of
the Merger and without any action on the part of the Company, Merger Subsidiary
or any Company Stockholder or holder of capital stock of Merger Subsidiary:

 

(a)     All Company Common Stock and Company Preferred Stock owned by Parent or
Merger Subsidiary immediately prior to the Effective Time or held by the Company
(as treasury stock or otherwise) immediately prior to the Effective Time (in
each case, other than any such Company Common Stock and Company Preferred Stock
held on behalf of third parties) (the “Cancelled Shares”) shall, by virtue of
the Merger and without any action on the part of the holder thereof, be
cancelled and retired and shall cease to exist, and no consideration shall be
delivered in exchange therefor or in respect thereof.

 

(b)     Each issued and outstanding share of Series C Preferred Stock (other
than (i) Cancelled Shares and (ii) Dissenting Shares) shall be converted
automatically into the right to receive, upon the surrender of the Certificate
formerly representing such share of Series C Preferred Stock in accordance with
Section 3.5, an amount in cash, without interest, equal to (A) the Series C
Preference Amount, plus the Closing Per Share Merger Consideration, plus (B) any
amounts that may become payable in respect of such share of Series C Preferred
Stock in the future from the Escrow Funds as provided in this Agreement and the
Escrow Agreement or in respect of the Post-Closing Adjustment, at the respective
times and subject to the contingencies specified herein and therein.

 

(c)     Each issued and outstanding share of Series E Preferred Stock (other
than (i) Cancelled Shares and (ii) Dissenting Shares) shall be converted
automatically into the right to receive, upon the surrender of the Certificate
formerly representing such share of Series E Preferred Stock in accordance with
Section 3.5, an amount in cash, without interest, equal to (A) the Series E
Preference Amount, plus the Closing Per Share Merger Consideration, plus (B) any
amounts that may become payable in respect of such share of Series E Preferred
Stock in the future from the Escrow Funds as provided in this Agreement and the
Escrow Agreement or in respect of the Post-Closing Adjustment, at the respective
times and subject to the contingencies specified herein and therein.

 

(d)     Each issued and outstanding share of Company Preferred Stock (other than
(i) Cancelled Shares, (ii) Dissenting Shares and (iii) shares of Series C
Preferred Stock and Series E Preferred Stock) shall be converted automatically
into the right to receive, upon the surrender of the Certificate formerly
representing such share of Company Preferred Stock in accordance with Section
3.5, an amount in cash, without interest, equal to (A) the Closing Per Share
Merger Consideration, plus (B) any amounts that may become payable in respect of
such share of Company Preferred Stock in the future from the Escrow Funds as
provided in this Agreement and the Escrow Agreement or in respect of the
Post-Closing Adjustment, at the respective times and subject to the
contingencies specified herein and therein.

 

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(e)     Each issued and outstanding share of Company Common Stock (other than
(i) Cancelled Shares and (ii) Dissenting Shares) shall be converted
automatically into the right to receive, upon the surrender of the Certificate
formerly representing such share of Company Common Stock in accordance with
Section 3.5, an amount in cash, without interest, equal to (A) the Closing Per
Share Merger Consideration, plus (B) any amounts that may become payable in
respect of such share of Company Common Stock in the future from the Escrow
Funds as provided in this Agreement and the Escrow Agreement or in respect of
the Post-Closing Adjustment, at the respective times and subject to the
contingencies specified herein and therein.

 

(f)     Each share of Merger Subsidiary Common Stock issued and outstanding
immediately prior to the Effective Time shall be converted automatically into
one validly issued, fully paid and nonassessable share of common stock, $0.001
par value per share, of the Surviving Corporation, and such shares of common
stock of the Surviving Corporation issued on such conversion shall constitute
all of the issued and outstanding shares of capital stock of the Surviving
Corporation immediately following the Effective Time.

 

Section 3.2     Treatment of Options; Company Stock Plan and Corporate Actions.

 

(a)     Immediately prior to, but contingent upon, the Effective Time, each
Option that is then outstanding and unexercised shall become fully vested and
exercisable. At the Effective Time, each Option that is outstanding and
unexercised immediately prior to the Effective Time shall be, by virtue of the
Merger and without any action on the part of Parent, Merger Subsidiary, the
Company, the Optionholder or any other Person, cancelled and each Optionholder
shall cease to have any rights with respect thereto other than the right to
receive with respect to such Options an amount in cash, without interest, equal
to the product of (x) the aggregate number of shares of Company Common Stock
subject to such Option, multiplied by (y) the excess of the Closing Per Option
Merger Consideration over the per share exercise price under such Option. After
the Effective Time, each Optionholder shall only be entitled to the payments
described in this Section 3.2.

 

(b)     At or prior to the Effective Time, the Company, the Company Board shall
adopt any resolutions and take any actions necessary to (i) effectuate the
provisions of Section 3.2(a) and (ii) cause the Company Stock Plan to terminate
at or prior to the Effective Time.

 

Section 3.3     Treatment of Company Warrants. No Company Warrants, whether
vested or unvested, shall be assumed by Parent in the Merger. Each Company
Warrant outstanding immediately prior to the Effective Time shall be cancelled,
terminated and extinguished as of the Effective Time without the payment of any
consideration to the holder of such Company Warrant. At or prior to the
Effective Time, the Company and the Company Board shall adopt any resolutions
and take any and all actions necessary to effectuate the provisions of this
Section 3.3.

 

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Section 3.4     Dissenting Shares. Notwithstanding any provision of this
Agreement to the contrary, including Section 3.1, Shares issued and outstanding
immediately prior to the Effective Time (other than Shares cancelled in
accordance with Section 3.1(a)) and held by a holder who has not voted in favor
of adoption of this Agreement or consented thereto in writing and who has
properly exercised appraisal rights of such Shares in accordance with Section
262 of the DGCL (such Shares being referred to collectively as the “Dissenting
Shares” until such time as such holder fails to perfect or otherwise loses such
holder’s appraisal rights under the DGCL with respect to such Shares) shall not
be converted into a right to receive a portion of the Merger Consideration, but
instead shall be entitled to only such rights as are granted by Section 262 of
the DGCL; provided, however, that if, after the Effective Time, such holder
fails to perfect, withdraws or loses such holder’s right to appraisal pursuant
to Section 262 of the DGCL or if a court of competent jurisdiction shall
determine that such holder is not entitled to the relief provided by Section 262
of the DGCL, such Shares shall be treated as if they had been converted as of
the Effective Time into the right to receive the portion of the Merger
Consideration, if any, to which such holder is entitled pursuant to Section 3.1,
without interest thereon. The Company shall provide Parent prompt written notice
of any demands received by the Company for appraisal of Shares, any withdrawal
of any such demand and any other demand, notice or instrument delivered to the
Company prior to the Effective Time pursuant to the DGCL that relates to such
demand, and Parent shall have the opportunity and right to direct all
negotiations and proceedings with respect to such demands. Except with the prior
written consent of Parent (not to be unreasonably withheld), the Company shall
not make any payment with respect to, or settle or offer to settle, any such
demands.

 

Section 3.5     Surrender and Payment.

 

(a)     At the Effective Time, all Shares, Options and Company Warrants
outstanding immediately prior to the Effective Time shall automatically be
cancelled and retired and shall cease to exist, and, subject to Section 3.4,
each holder of a certificate formerly representing any Shares (each, a
“Certificate”) and each holder of record of an Option or Company Warrant shall
cease to have any rights as a stockholder of the Company or a holder of Options
or Company Warrants, as applicable.

 

(b)     Prior to the Effective Time, Parent shall appoint an exchange agent
reasonably acceptable to the Company (the “Exchange Agent”) to act as the
exchange agent in the Merger.

 

(c)     As promptly as practicable following the Closing Date and in any event
not later than two Business Days thereafter, Parent shall cause the Exchange
Agent to mail to each holder of Company Common Stock and each holder of Company
Preferred Stock a letter of transmittal in substantially the form attached as
Exhibit C (a “Letter of Transmittal”) and instructions for use in effecting the
surrender of Certificates in exchange for the applicable portion of Merger
Consideration pursuant to Section 3.1. The Exchange Agent shall, no later than
three Business Days after receipt of a Certificate, together with a Letter of
Transmittal duly completed and validly executed in accordance with the
instructions thereto, and any other customary documents that the Exchange Agent
may reasonably require in connection therewith (including a completed Form W-8
or Form W-9, as applicable), pay to the holder of such Certificate a cash amount
as provided in Section 3.1 with respect to such Certificate so surrendered and
the Certificate shall forthwith be cancelled. Unless otherwise provided herein,
no interest shall be paid or shall accrue on any cash payable upon surrender of
any Certificate. Until so surrendered, each outstanding Certificate that prior
to the Effective Time represented shares of Company Common Stock or Company
Preferred Stock (other than Dissenting Shares) shall be deemed from and after
the Effective Time, for all purposes, to evidence the right to receive the
portion of the Merger Consideration as provided in Section 3.1. If after the
Effective Time, any Certificate is presented to the Exchange Agent, it shall be
cancelled and exchanged as provided in this Section 3.4.

 

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(d)     With respect to Optionholders who are current employees of the Company
or any Subsidiary, Parent shall, no later than ten Business Days (or the next
regularly scheduled payroll cycle) after Closing (subject to receipt by Parent
or the Company of any customary documents that Parent may reasonably require in
connection therewith (including a completed Form W-8 or Form W-9, as
applicable)), cause the Company’s current payroll provider, on behalf of the
Company, to deliver such Optionholder the cash amount such Optionholder has the
right to receive pursuant to Section 3.2(a) (net of any deductions and
withholdings required under Section 3.9 below). As promptly as practicable
following the Closing Date and in any event not later than two Business Days
thereafter, Parent shall cause the Exchange Agent to mail to each Optionholder
who is not a current employee of the Company or any Subsidiary a letter
requesting a completed Form W-8 or Form W-9, as applicable, from such
Optionholder, verification of such Optionholder’s address and such other
information as may be required to pay the applicable portion of Merger
Consideration to such Optionholder. Upon receipt by the Exchange Agent of the
completed Form W-8 or Form W-9, as applicable, verification of address and such
other information as required from any such Optionholder, the Exchange Agent
shall, no later than three Business Days thereafter, pay to such Optionholder a
cash amount as provided in Section 3.2(a). Unless otherwise provided herein, no
interest shall be paid or shall accrue on any cash payable upon delivery of any
consideration pursuant to Section 3.2(a).

 

(e)     Each Company Stockholder shall also be entitled to any amounts that may
be payable in the future in respect of the Shares formerly represented by such
Certificate from the Escrow Funds as provided in this Agreement and the Escrow
Agreement and on account of the Post-Closing Adjustment, at the respective time
and subject to the contingencies specified herein and therein. Unless otherwise
provided herein, no interest shall be paid or accrued for the benefit of Company
Stockholders on the Merger Consideration.

 

(f)     If any portion of the Merger Consideration is to be paid to a Person
other than the Person in whose name the surrendered Certificate is registered,
it shall be a condition to such payment that (i) such Certificate shall be
properly endorsed or shall otherwise be in proper form for transfer, and (ii)
the Person requesting such payment shall pay to the Exchange Agent any transfer
or other Tax required as a result of such payment to a Person other than the
registered holder of such Certificate or establish to the reasonable
satisfaction of the Exchange Agent that such Tax has been paid or is not
payable.

 

(g)     Any portion of the Merger Consideration or any other consideration
payable hereunder that remains unclaimed by the Company Stockholders or
Optionholders 12 months after the Effective Time shall be returned to Parent,
upon demand, and any such Company Stockholder who has not exchanged Certificates
for the Merger Consideration or any other such consideration in accordance with
this Section 3.4 prior to that time shall thereafter look only to Parent for
payment of the Merger Consideration or any other such consideration; provided,
however, that any such portion of the Merger Consideration payable from the
Escrow Funds shall be held and distributed to the Persons entitled thereof in
accordance with the terms of this Agreement and the Escrow Agreement, at the
respective times and subject to the contingencies specified herein and therein
and any portion of the Post-Closing Adjustment to which the Company Stockholders
may become entitled shall become payable at the times and subject to the
contingencies specified herein. Notwithstanding the foregoing, Parent shall not
be liable to any holder of Certificates or Options for any amounts paid to a
public official pursuant to applicable abandoned property, escheat or similar
Laws. Any amounts remaining unclaimed by Company Stockholders or Optionholders
24 months after the Effective Time (or such earlier date, immediately prior to
such time when the amounts would otherwise escheat to or become property of any
Governmental Authority) shall become, to the extent permitted by applicable Law,
the property of Parent free and clear of any claims or interest of any Person
previously entitled thereto.

 

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(h)     Any portion of the Merger Consideration made available to the Exchange
Agent in respect of any Dissenting Shares shall be returned to Parent, upon
demand.

 

Section 3.6     Escrow Funds. In accordance with the Escrow Agreement, Parent
shall deposit or cause to be deposited with the Escrow Agent:

 

(a)     the Indemnification Escrow Amount (such amount, including any interest
or other amounts earned thereon and less any disbursements therefrom in
accordance with the Escrow Agreement, the “Indemnification Escrow Fund”), to be
held for the purpose of securing the indemnification obligations of the Company
Stockholders set forth in this Agreement and the obligations pursuant to Section
3.11(d); and

 

(b)     the Purchase Price Adjustment Escrow Amount (such amount, including any
interest or other amounts earned thereon and less any disbursements therefrom in
accordance with the Escrow Agreement, the “Purchase Price Adjustment Escrow
Fund”), to be held for the purpose of securing the obligations of the Company
Stockholders in Section 3.11(d); and

 

(c)     the Stockholder Representative Escrow Amount (such amount, including any
interest or other amounts earned thereon and less any disbursements therefrom in
accordance with the Escrow Agreement, the “Stockholder Representative Escrow
Fund” and together, with the Indemnification Escrow Fund and the Purchase Price
Adjustment Escrow Fund, the “Escrow Funds”), to be held for the purpose of
funding any expenses of Stockholder Representative arising in connection with
the administration of Stockholder Representative’s duties in this Agreement
after the Effective Time.

 

Section 3.7     No Further Ownership Rights in Company Common Stock and Options.
All Merger Consideration paid or payable upon the surrender of Certificates, and
all Merger Consideration paid or payable in respect of the Options, in
accordance with the terms hereof shall be deemed to have been paid or payable in
full satisfaction of all rights pertaining to the Shares formerly represented by
such Certificate and such Options, and from and after the Effective Time, there
shall be no further registration of transfers of Shares on the stock transfer
books of the Surviving Corporation. If, after the Effective Time, Certificates
are presented to the Surviving Corporation, they shall be cancelled and
exchanged for the Merger Consideration provided for, and in accordance with the
procedures set forth, in this Article III and elsewhere in this Agreement.

 

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Section 3.8     Adjustments. Without limiting the other provisions of this
Agreement, if at any time during the period between the date of this Agreement
and the Effective Time, any change in the outstanding shares of capital stock of
the Company shall occur, including by reason of any reclassification,
recapitalization, stock split (including reverse stock split) or combination,
exchange or readjustment of shares, or any stock dividend or distribution paid
in stock, the Merger Consideration and any other amounts payable pursuant to
this Agreement shall be appropriately adjusted to reflect such change.

 

Section 3.9     Withholding Rights. Each of the Exchange Agent, Parent, Merger
Subsidiary and the Surviving Corporation shall be entitled to deduct and
withhold from the consideration otherwise payable to any Person pursuant to this
Agreement such amounts as may be required to be deducted and withheld with
respect to the making of such payment under any provision of Tax Law. To the
extent that amounts are so deducted and withheld by the Exchange Agent, Parent,
Merger Subsidiary or the Surviving Corporation, as the case may be, and remitted
to the appropriate Tax Authority, such amounts shall be treated for all purposes
of this Agreement as having been paid to the Person in respect of which the
Exchange Agent, Parent, Merger Subsidiary or the Surviving Corporation, as the
case may be, made such deduction and withholding.

 

Section 3.10     Lost Certificates. If any Certificate shall have been lost,
stolen or destroyed, upon the making of an affidavit of that fact by the Person
claiming such Certificate to be lost, stolen or destroyed and, if required by
Parent, the posting by such Person of a bond, in such reasonable amount as
Parent may direct, as indemnity against any claim that may be made against it
with respect to such Certificate, the Exchange Agent shall issue, in exchange
for such lost, stolen or destroyed Certificate, the Merger Consideration to be
paid in respect of the Shares formerly represented by such Certificate as
contemplated under this Article III.

 

Section 3.11     Working Capital Adjustment.

 

(a)     Closing Adjustment.

 

(i)     “Working Capital” shall be the amount equal to the following
calculation: receivables, inventory, prepaid expenses and other non-cash current
assets of the Company, less current liabilities in each case as determined in
accordance with GAAP and, to the extent not inconsistent with GAAP, the
Company’s past accounting practices and principles. The parties acknowledge and
agree that Schedule 3.11 sets forth a sample work sheet of Working Capital (and
the components thereof) based upon the Working Capital as of October 31, 2017
(the “Sample Working Capital Calculation”). The Company shall accrue as a
current liability in the Sample Working Capital Calculation, the Estimated
Working Capital Statement and the Closing Working Capital Statement the employer
portion of all withholding Taxes payable with respect to all Options outstanding
immediately prior to the Effective Time.

 

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(ii)     At least three Business Days before the Closing, the Company shall
prepare and deliver to Parent a statement setting forth its good faith estimate
of Closing Working Capital (the “Estimated Closing Working Capital”), which
statement shall contain an estimated balance sheet of the Company as of the
Closing Date (without giving effect to the transactions contemplated herein), a
calculation of Estimated Closing Working Capital (the “Estimated Closing Working
Capital Statement”), and a certificate of the Chief Financial Officer of the
Company that the Estimated Closing Working Capital Statement was prepared in
accordance with GAAP and the Sample Working Capital Calculation. For purposes of
this Section 3.11 and this Agreement, the Company shall be credited with an
increase to Working Capital of (A) up to $2 million representing amounts
actually invested after September 29, 2017, in land, buildings, and other
capital investment in Vietnam, plus (B) the amount of the prepayment penalty and
exit fees (which shall be set forth in the payoff letter from NH Expansion Fund
Holdings, LP to be delivered to Parent at Closing) payable to NH Expansion Fund
Holdings, LP in satisfaction in full of the Company Indebtedness payable
thereto.

 

(iii)     The “Estimated Closing Adjustment” shall be an amount equal to the
Estimated Closing Working Capital minus $10,329,844 (the “Target Working
Capital”).

 

(b)     Post-Closing Adjustment.

 

(i)     Within 90 days after the Closing Date, Parent shall prepare and deliver
to Stockholder Representative a statement setting forth its calculation of
Closing Working Capital, which statement shall contain a balance sheet of the
Company as of the Closing Date (without giving effect to the transactions
contemplated herein), a calculation of Closing Working Capital (the “Closing
Working Capital Statement”) and a certificate of the Chief Financial Officer of
Parent that the Closing Working Capital Statement was prepared in accordance
with GAAP applied using the same accounting methods, practices, principles,
policies and procedures, with consistent classifications, judgments and
valuation and estimation methodologies that were used in the preparation of the
Audited Financial Statements for the most recent fiscal year end as if such
Closing Working Capital Statement was being prepared and audited as of a fiscal
year end.

 

(ii)     The “Post-Closing Adjustment” shall be an amount equal to the Closing
Working Capital minus the Estimated Closing Working Capital; provided, however,
that (A) if the result of such calculation is a positive number, it shall be
capped at $1,500,000, and (B) if the result of such calculation is a negative
number, it shall be capped at ($1,500,000).

 

(c)     Examination and Review.

 

(i)     Examination. After receipt of the Closing Working Capital Statement,
Stockholder Representative shall have 30 days (the “Review Period”) to review
the Closing Working Capital Statement. During the Review Period, Stockholder
Representative and its accountants shall have full access to the books and
records of the Surviving Corporation, the personnel of, and work papers prepared
by, Parent and/or its accountants to the extent that they relate to the Closing
Working Capital Statement and to such historical financial information (to the
extent in Parent’s possession) relating to the Closing Working Capital Statement
as Stockholder Representative may reasonably request for the purpose of
reviewing the Closing Working Capital Statement and to prepare a Statement of
Objections (defined below), provided, that such access shall be in a manner that
does not interfere with the normal business operations of Parent or the
Surviving Corporation.

 

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(ii)     Objection. On or prior to the last day of the Review Period,
Stockholder Representative may object to the Closing Working Capital Statement
by delivering to Parent a written statement setting forth its objections in
reasonable detail, indicating each disputed item or amount and the basis for its
disagreement therewith (the “Statement of Objections”). If Stockholder
Representative fails to deliver the Statement of Objections before the
expiration of the Review Period, the Closing Working Capital Statement and the
Post-Closing Adjustment, as the case may be, reflected in the Closing Working
Capital Statement shall be deemed to have been accepted by Stockholder
Representative. If Stockholder Representative delivers the Statement of
Objections before the expiration of the Review Period, Parent and Stockholder
Representative 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 Working Capital Statement with such
changes as may have been previously agreed in writing by Parent and Stockholder
Representative, shall be final and binding.

 

(iii)     Resolution of Disputes. If Stockholder Representative and Parent 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 Mayer
Hoffman McCann P.C. or, if Mayer Hoffman McCann P.C. is unable or unwilling to
serve, Parent and Stockholder Representative shall appoint by mutual agreement
an impartial nationally recognized firm of independent certified public
accountants (the “Independent Accountant”) who, acting as experts and not
arbitrators, shall resolve the Disputed Amounts only and make any adjustments to
the Post-Closing Adjustment, as the case may be, and the Closing Working Capital
Statement. The Parties hereto agree that all adjustments shall be made without
regard to materiality. The Independent Accountant shall only decide the specific
items under dispute by the Parties and their decision for each Disputed Amount
must be within the range of values assigned to each such item in the Closing
Working Capital Statement and the Statement of Objections, respectively. For
purposes of this Agreement, the procedures set forth in Section 3.11(c)(i) - (v)
shall be considered to be arbitration within the meaning of the Federal
Arbitration Act and any cognate state law and the courts of Delaware shall have
jurisdiction to enforce any and all orders and awards of the Independent
Accountant.

 

(iv)     Fees of the Independent Accountant. The fees and expenses of the
Independent Accountant shall be paid by Stockholder Representative (on behalf of
the Company Stockholders), on the one hand, and by Parent, on the other hand,
based upon the percentage that the amount actually contested but not awarded to
Stockholder Representative or Parent, respectively, bears to the aggregate
amount actually contested by Stockholder Representative and Parent. Any such
fees and expenses payable by Stockholder Representative shall be paid from the
Stockholder Representative Escrow Fund to the extent available.

 

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(v)     Determination by Independent Accountant. The Independent Accountant
shall make a determination as soon as practicable within 30 days after their
engagement, and their resolution of the Disputed Amounts and their adjustments
to the Closing Working Capital Statement and/or the Post-Closing Adjustment
shall be conclusive and binding upon the Parties and shall be considered a
“final award” issued by an arbitrator for purposes of the Federal Arbitration
Act and any cognate state law.

 

(d)     Payment of Post-Closing Adjustment.

 

(i)     If the Post-Closing Adjustment is a negative number, Stockholder
Representative and Parent shall, within two Business Days after the final
determination of the Post-Closing Adjustment, jointly instruct the Escrow Agent
to disburse from the Purchase Price Adjustment Escrow Fund by wire transfer of
immediately available funds (A) to Parent, the Post-Closing Adjustment, and (B)
to the Exchange Agent, for distribution to the Company Stockholders in
accordance with their Pro Rata Shares, such Company Stockholders’ aggregate Pro
Rata Share of any amounts remaining in the Purchase Price Adjustment Escrow
Fund. For avoidance of doubt, the maximum Post-Closing Adjustment payable to
Parent shall be limited to the Purchase Price Adjustment Escrow Fund.

 

(ii)     If the Post-Closing Adjustment is a positive number, then within two
Business Days after the final determination of the Post-Closing Adjustment, (A)
Stockholder Representative and Parent shall jointly instruct the Escrow Agent to
disburse to Exchange Agent the Price Adjustment Escrow Fund by wire transfer of
immediately available funds and (B) Parent shall deposit with the Exchange Agent
an amount equal to the Post-Closing Adjustment (for avoidance of doubt, the
maximum Post-Closing Adjustment shall be limited to $1,500,000). The Exchange
Agent shall thereafter (x) disburse to the Company Stockholders their Pro Rata
Share of the Purchase Price Adjustment Escrow Fund and (y) disburse to the
Company Stockholders and Optionholders, such Company Stockholders’ and such
Optionholders’ aggregate Adjustment Pro Rata Share of the Post-Closing
Adjustment. For the avoidance of doubt, if the Post-Closing Adjustment is a
positive number, then (1) the Company Stockholders shall be entitled to receive
the sum of (a) their Pro Rata Share of the Purchase Price Adjustment Escrow Fund
and (b) their Adjustment Pro Rata Share of the Post-Closing Adjustment, and (2)
the Optionholders shall be entitled to receive their Adjustment Pro Rata Share
of the Post-Closing Adjustment

 

(e)     Adjustments for Tax Purposes. Any payments made pursuant to Section 3.10
shall be treated as an adjustment to the Purchase Price by the Parties for Tax
purposes, unless otherwise required by Law.

 

Section 3.12     Consideration Spreadsheet.

 

(a)     At least three Business Days before the Closing and concurrently with
the delivery of the Estimated Closing Working Capital Statement, the Company
shall prepare and deliver to Parent a spreadsheet (the “Consideration
Spreadsheet”), certified by the Chief Financial Officer of the Company, which
shall set forth, as of the Closing Date and immediately prior to the Effective
Date, the following:

 

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(i)     the names, addresses and email addresses (to the extent available) of
all Company Stockholders and the number of shares of Company Common Stock and
number of shares of each series of Company Preferred Stock held by such Persons;

 

(ii)     the names, addresses and email addresses (to the extent available) of
all Optionholders, together with the number of Shares subject to Options held by
such Optionholders, the grant date, exercise price and vesting schedule for such
Options;

 

(iii)     detailed calculations of the Closing Merger Consideration, Fully
Diluted Share Number, Closing Per Share Merger Consideration and the Closing Per
Option Merger Consideration;

 

(iv)     each Company Stockholder’s Pro Rata Share (as a percentage interest and
the interest in dollar terms) of the amount to be contributed to the Escrow
Funds; and

 

(v)     each Company Stockholder’s and Optionholder’s Adjustment Pro Rata Share
(as a percentage interest) of the Post-Closing Adjustment, if any.

 

(b)     The Parties agree that Parent, Merger Subsidiary and the Exchange Agent
shall be entitled to rely on the Consideration Spreadsheet in making payments
under Article III and Parent, Merger Subsidiary and the Exchange Agent shall not
be responsible for the calculations or the determinations regarding such
calculations in such Consideration Spreadsheet.

 

Section 3.13     Delivery of Closing Indebtedness and Net Debt Certificate and
Closing Company Transaction Expenses Certificate. At least three Business Days
before the Closing and concurrently with the delivery of the Estimated Closing
Working Capital Statement, the Company shall prepare and deliver to Parent (a) a
certificate executed by the Chief Financial Officer of the Company certifying on
behalf of the Company (i) an itemized list of all outstanding Company
Indebtedness as of the Closing Date and the Person to whom such outstanding
Company Indebtedness is owed and an aggregate total of such outstanding Company
Indebtedness, (ii) the Company Cash as of the Closing Date and (iii) the
calculation of Net Debt as of the Closing (the “Closing Indebtedness and Net
Debt Certificate”), and a certificate executed by the Chief Financial Officer of
the Company, certifying the amount of Company Transaction Expenses remaining
unpaid as of the Closing Date (including an itemized list of each such unpaid
Company Transaction Expense with a description of the nature of such expense and
the Person to whom such expense is owed) (the “Closing Company Transaction
Expenses Certificate”).

 

Article IV

REPRESENTATIONS AND WARRANTIES OF THE COMPANY

 

Except as specifically set forth in the section of the Company Disclosure Letter
that corresponds with the section of this Agreement in which the related
representation or warranty appears (unless (i) such disclosure includes a
specific cross-reference to another section or (ii) the relevance to other
representations and warranties is reasonably apparent from the actual text of
the disclosures), the Company represents and warrants to Parent and Merger
Subsidiary as of the date hereof and as of Closing as follows:

 

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Section 4.1     Organization and Authority of the Company.

 

(a)     The Company is a corporation duly organized, validly existing and in
good standing under the Laws of the State of Delaware and has the requisite
corporate power and authority to own or lease all of its properties and assets
and to carry on its business as it is now being conducted. Each Subsidiary is
duly organized, validly existing and in good standing under the Laws of its
jurisdiction of organization and has the requisite power and authority to own or
lease all of its properties and assets and to carry on its business as it is now
being conducted. Each of the Company and each Subsidiary is duly licensed or
qualified to do business in each jurisdiction in which the nature of the
business conducted by it or the character or location of the properties and
assets owned or leased by it makes such licensing or qualification necessary,
except where the failure to be so licensed or qualified would not reasonably be
expected to have a Company Material Adverse Effect. Section 4.1(a) of the
Company Disclosure Letter sets forth for the Company and each Subsidiary, each
jurisdiction in which it is so qualified. The copies of the Certificate of
Incorporation, as amended, and Bylaws of the Company (the “Company Charter” and
“Company Bylaws”, respectively), in the form delivered or made available to
Merger Subsidiary and Parent, are true, complete and correct copies of such
documents as in effect as of the date of this Agreement. The copies of the
organizational/constituent documents of the Subsidiaries in the form delivered
to Merger Subsidiary and Parent, are true, complete and correct copies of such
documents as in effect as of the date of this Agreement.

 

(b)     The Subsidiaries constitute all direct and indirect subsidiaries of the
Company. Section 4.1(b) of the Company Disclosure Letter sets forth for each
Subsidiary, as of the date of this Agreement, (i) the name and jurisdiction of
formation of such Subsidiary, and (ii) the names of all directors, officers,
managers, general managers or persons holding comparable positions with respect
to such Subsidiary.

 

Section 4.2     Capitalization.

 

(a)     The authorized capital stock of the Company consists of 63,500,000
shares of Company Common Stock and 34,256,283 shares of Company Preferred Stock,
of which (i) 1,115,790 shares of Series A Preferred Stock are authorized, (ii)
13,524,095 shares of Series B Preferred Stock are authorized, (iii) 8,553,382
shares of Series C Preferred Stock are authorized, (iv) 3,000,000 shares of
Series D Preferred Stock are authorized, (v) 1,763,016 shares of Series E
Preferred Stock are authorized, and (vi) 6,300,000 shares of Series F Preferred
Stock are authorized. At the date hereof, there are (i) 8,049,517 shares of
Company Common Stock issued and outstanding, (ii) 1,115,790 shares of Series A
Preferred Stock issued and outstanding, (iii) 13,512,428 shares of Series B
Preferred Stock issued and outstanding, (iv) 8,239,716 shares of Series C
Preferred Stock issued and outstanding, (v) 2,666,667 shares of Series D
Preferred Stock issued and outstanding, (vi) 1,763,016 shares of Series E
Preferred Stock issued and outstanding, and (vii) 4,459,362 shares of Series F
Preferred Stock issued and outstanding. All of the issued and outstanding shares
of Company Capital Stock have been, and all of the shares of Company Capital
Stock which may be issued upon exercise of conversion of Company Warrants on or
prior to the Closing Date will be, duly authorized and validly issued and are
or, if not yet issued, will be fully paid, nonassessable and free of any
preemptive rights. The Company does not, directly or indirectly, own any equity
securities or other ownership interests in any Person, other than the
Subsidiaries. Section 4.2(a) of the Company Disclosure Letter sets forth a true
and correct list of each holder of Company Capital Stock and indicates the
number and class or series of shares owned by each such Person.

 

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(b)     As of the date of this Agreement, an aggregate of 6,218,068 shares of
Company Common Stock were subject to issuance pursuant to Options issued
pursuant to the Company Stock Plan. Section 4.2(b) of the Company Disclosure
Letter sets forth, as of the date of this Agreement, the following information
with respect to each outstanding Option: (i) the name of the holder of such
Option; (ii) the number of shares of Company Common Stock subject to such
Option; (iii) the exercise price of such Option; and (iv) the vesting schedule
of such Option. Each Option was granted in compliance with all applicable Laws
and all of the terms and conditions of the Company Stock Plan pursuant to which
it was issued. Each Option was granted with an exercise price per share equal to
or greater than the fair market value of the underlying shares on the date of
grant and has a grant date identical to the date on which the Company Board
actually awarded the Option. Each Option qualifies for the tax and accounting
treatment afforded to such Option in the Company’s tax returns and the Company’s
financial statements. The Company has provided or made available to Parent true
and complete copies of the standard form of option agreement and any stock
option agreements that differ from such standard form. The Company has made
available to Parent copies of each form of stock option agreement evidencing
outstanding Options.

 

(c)     Section 4.2(c) of the Company Disclosure Letter sets forth, as of the
date of this Agreement, the following information with respect to each
outstanding Company Warrant: (i) the name of the holder of such Company Warrant;
(ii) the number and type of shares of Company Capital Stock subject to such
Company Warrant; and (iii) the exercise price of such Company Warrant. The
Company has made available to Parent copies of each form of warrant agreement
evidencing outstanding Company Warrants.

 

(d)     As of the date hereof, except for the Options set forth in Section
4.2(b) of the Company Disclosure Letter and the Company Warrants set forth in
Section 4.2(c) of the Company Disclosure Letter, there are not, and as of the
Effective Time there will not be, any outstanding securities, options, warrants,
calls, rights, commitments, agreements, derivative contracts, forward sale
contracts or undertakings of any kind to which the Company is a party, or by
which the Company is bound, obligating the Company to issue, deliver or sell, or
cause to be issued, delivered or sold, additional shares of capital stock or
other securities of the Company or obligating the Company to issue, grant,
extend or enter into any such security, option, warrant, call, right,
commitment, agreement, derivative contract, forward sale contract or
undertaking, or obligating the Company to make any payment based on or resulting
from the value or price of the Company Common Stock or of any such security,
option, warrant, call, right, commitment, agreement, derivative contract,
forward sale contract or undertaking. There are no outstanding contractual
obligations of the Company to repurchase, redeem or otherwise acquire any shares
of capital stock of the Company. There are no outstanding or authorized stock
appreciation, phantom stock, profit participation or other similar rights with
respect to the Company. The Company does not have any outstanding bonds,
debentures, notes or other obligations, the holders of which have the right to
vote (or which are convertible into or exercisable for securities having the
right to vote) with the Company Stockholders on any matter.

 

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(e)     All of the issued and outstanding shares of capital stock or other
equity interests of each Subsidiary have been duly authorized and validly issued
and are fully paid, nonassessable and free of preemptive rights (or
substantially equivalent terms under the Laws of any foreign jurisdiction of
organization of any Subsidiary) and are owned legally and beneficially, directly
or indirectly, solely by the Company, free and clear of any Liens. As of the
date hereof, there are not, and as of the Effective Time there will not be, any
outstanding securities, options, warrants, calls, rights, commitments,
agreements, derivative contracts, forward sale contracts or undertakings of any
kind to which any Subsidiary is a party, or by which any Subsidiary is bound,
obligating such Subsidiary to issue, deliver or sell, or cause to be issued,
delivered or sold, additional capital stock or other voting securities of such
Subsidiary or obligating such Subsidiary to issue, grant, extend or enter into
any such security, option, warrant, call, right, commitment, agreement,
derivative contract, forward sale contract or undertaking, or obligating such
Subsidiary to make any payment based on or resulting from the value or price of
the capital stock or of any such security, option, warrant, call, right,
commitment, agreement, derivative contract, forward sale contract or
undertaking. There are no outstanding contractual obligations of any Subsidiary
to repurchase, redeem or otherwise acquire any capital stock of such Subsidiary.
There are no outstanding or authorized capital stock appreciation, phantom stock
interest, profit participation or other similar rights with respect to any
Subsidiary. No Subsidiary has any outstanding bonds, debentures, notes or other
obligations, the holders of which have the right to vote (or which are
convertible into or exercisable for securities having the right to vote) with
the stockholders or other equityholders of such Subsidiary on any matter. Other
than other Subsidiaries, no Subsidiary, directly or indirectly owns any equity
securities or other ownership interests in any Person. Section 4.2(e) of the
Company Disclosure Letter sets forth a description of all authorized and
outstanding capital stock or other equity securities of each Subsidiary and the
names of the holder(s) thereof.

 

(f)     There are no stockholder agreements, voting trusts or other agreements
or understandings to which the Company or any Subsidiary is a party with respect
to the voting, transfer or registration of the capital stock or other equity
interests of the Company or any Subsidiary.

 

(g)     Except as set forth in Section 4.2(g) of the Company Disclosure Letter
with respect to the Company Preferred Stock, there are no declared or accrued
unpaid dividends with respect to any shares of Company Capital Stock.

 

Section 4.3     Authority Relative to this Agreement. The execution, delivery
and performance (subject, with respect to the Merger, to obtaining the Company
Stockholder Approval) of this Agreement and of all of the other documents and
instruments required hereby by the Company are within the corporate power and
authority of the Company. The execution and delivery of this Agreement and the
Ancillary Documents to which the Company is a party and the consummation of the
transactions contemplated hereby and thereby, including the Merger, have been
duly authorized by the Board of Directors of the Company and no other corporate
proceedings on the part of the Company are necessary to authorize the execution,
delivery and performance of this Agreement and the Ancillary Documents to which
the Company is a party or to consummate the transactions contemplated hereby and
thereby, including the Merger (other than, with respect to the Merger,
(a) receipt of the Company Stockholder Approval and (b) the filing of the
Certificate of Merger with the Secretary of State of the State of Delaware).
This Agreement and the Ancillary Documents to which the Company is a party have
been or will be duly and validly executed and delivered by the Company and
(assuming the due authorization, execution and delivery hereof and thereof by
Parent and Merger Subsidiary) constitute or, in the case of the Ancillary
Documents, will constitute valid and binding agreements of the Company,
enforceable against the Company in accordance with their respective terms,
except to the extent that their enforceability may be limited by applicable
bankruptcy, insolvency, reorganization or other Laws affecting the enforcement
of creditors’ rights generally or by equitable principles.

 

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Section 4.4     Consents and Approvals; No Violations. Except for (a) the filing
of the Certificate of Merger with the Secretary of State of the State of
Delaware as required by the DGCL, (b) the Company Stockholder Approval, (c) the
consents, approvals and notices set forth in Section 4.4 of the Company
Disclosure Letter (which include the Required Consents) and (d) as required by
the HSR Act, no filing or registration with, or notice to, and no Permit,
authorization, waiting period expiration or termination, consent or approval of,
any Governmental Authority or any other Person is necessary or required in
connection with the Company’s execution and delivery of this Agreement and each
Ancillary Document to which it is a party, or for the consummation by the
Company of the transactions contemplated by this Agreement in the Merger.
Assuming that all filings, registrations, Permits, authorizations, waiting
period expirations, consents, approvals and notices contemplated by the
immediately preceding sentence have been duly made or obtained, neither the
execution or delivery by the Company of this Agreement and each Ancillary
Document to which the Company is a party nor the performance of this Agreement
and each such Ancillary Document nor the consummation of the transactions
contemplated hereby or thereby by the Company will (i) conflict with or result
in any breach of any provision of the Company Charter, the Company Bylaws or the
organizational/constituent documents of any Subsidiary, (ii) result in a
violation or breach of, or constitute (with or without due notice or lapse of
time or both) a default (or give rise to any right of termination, cancellation
or acceleration) under, any of the terms, conditions or provisions of any note,
bond, mortgage, indenture, license or Company Contract to which the Company or
any Subsidiary is a party, (iii) violate any order, writ, injunction, decree,
statute, rule or regulation applicable to the Company or any Subsidiary or any
of their respective material properties or assets, (iv) result in the creation
or imposition of any Lien on any material properties or assets owned by or
purported to be owned by the Company or any Subsidiary, or (v) conflict with or
violate any applicable Law.

 

Section 4.5     Financial Statements.

 

(a)     The Company has delivered to Parent (a) the audited consolidated balance
sheets of the Company as of December 31, 2016 (the “2016 Balance Sheet”),
December 31, 2015 and December 31, 2014 and the related audited consolidated
statements of operations and comprehensive loss, changes in stockholders’
deficit and cash flows for each of the fiscal years then ended (collectively,
the “Year-End Financial Statements”); and (b) an unaudited consolidated balance
sheet of the Company as of September 30, 2017 (including the notes thereto, the
“Interim Balance Sheet”), and the related unaudited consolidated statements of
operations and comprehensive loss, changes in stockholder’s deficit and cash
flows for the nine-month period then ended (together with the Interim Balance
Sheet, the “Interim Financial Statements”, and the Interim Financial Statements,
together with the Year-End Financial Statements, are the “Financial
Statements”). The Financial Statements of the Company are consistent with the
Books and Records and fairly present, in all material respects, the financial
condition of the Company as of the dates thereof and the results of its
operations for the periods then ended in compliance with GAAP applied on a
consistent basis during the periods involved (except (i) as may be indicated
therein or in the notes thereto and (ii) the Interim Financial Statements do not
contain footnotes and other presentation items that may be required by GAAP and
are subject to normal year-end adjustments).

 

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(b)     The management of the Company (i) has designed disclosure controls and
procedures to ensure that material information relating to the Company and the
Subsidiaries is made known to the management of the Company by others within the
Company and the Subsidiaries, and (ii) has disclosed, based on its most recent
evaluation, to the Company’s auditors (A) all significant deficiencies in the
design or operation of internal controls which could adversely affect the
Company’s ability to record, process, summarize and report financial data and
have identified for the Company’s auditors any material weaknesses in internal
controls and (B) any fraud, whether or not material, that involves management or
other employees who have a significant role in the Company’s internal controls.

 

(c)     The Company maintains a system of internal accounting controls
sufficient to provide reasonable assurance that (i) transactions are executed in
accordance with management’s general or specific authorization, (ii)
transactions are recorded as necessary to permit preparation of financial
statements in conformity in all material respects with GAAP and to maintain
accountability for assets, (iii) access to assets is permitted only in
accordance with management’s general or specific authorization, and (iv) the
recorded accountability for assets is compared with existing assets at
reasonable intervals and appropriate action is taken with respect to any
differences.

 

Section 4.6     Title to and Sufficiency of Assets.

 

(a)     Except as with respect to Real Property, which is addressed in Section
4.7, the Company and each Subsidiary has good, valid and marketable title to,
or, in the case of leased properties and assets, valid leasehold interests in,
all of its tangible personal property reflected in the Financial Statements or
acquired after the date of the Interim Balance Sheet, free and clear of all
Liens, except (i) Liens securing Indebtedness that is reflected in the Financial
Statements, and (ii) such imperfections of title and encumbrances, if any, which
do not detract in any material respect from the value or interfere in any
material respect with the present use of the property subject thereto or
affected thereby.

 

(b)     Except as set forth in Section 4.6(b)(i) of the Company Disclosure
Letter, all tangible assets owned or used by the Company or any Subsidiary
(including all assets held under leases and licenses but excluding any real
property and including all fixtures and equipment owned or used by the Company
or any Subsidiary), taken as a whole, are in good operating condition and repair
in all material respects for assets of like type and age, subject to ordinary
wear and tear, and are adequate for the conduct of the business of the Company
as currently conducted and as will be conducted immediately prior to Closing.
Except as set forth in Section 4.6(b)(ii) of the Company Disclosure Letter,
there are no existing or, to the Knowledge of the Company, proposed agreements,
options, commitments or rights with, of or to any Person or Governmental
Authority to acquire or to condemn, expropriate or otherwise take without
payment any of the properties or assets of the Company or any Subsidiary or any
interest therein.

 

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Section 4.7     Real Property.

 

(a)     Except as set forth in Section 4.7(a) of the Company Disclosure Letter,
neither the Company nor any Subsidiary is a party to any agreement or option to
purchase any real property or any interest therein.

 

(b)     Set forth in Section 4.7(b) of the Company Disclosure Letter is the
address of all real property owned (“Owned Real Property”) or leased (“Leased
Real Property”, and together with the Owned Real Property, the “Real Property”)
by the Company or any Subsidiary, and a true and complete list of all leases,
subleases, licenses, concessions and other tenancy agreements (the “Real
Property Leases”) and deeds (the “Deeds”) with respect thereto for all Real
Property (including the date and name of the parties to each such Real Property
Lease or Deed). With respect to the Real Property, the Company has delivered or
made available to Parent and Merger Subsidiary, to the extent in the possession
of the Company or a Subsidiary, a true and complete copy of each of the Real
Property Leases and Deeds; all surveys, title insurance policies, title
commitments and title reports; certificates of occupancy; zoning letters and
approvals; real estate tax bills; notices of violation of any law, statute or
ordinance; copies of all environmental, wetlands, archeological, soils and
geotechnical reports; service and maintenance agreements; Permits; and all other
information related to the use and occupancy of the Real Property and any
material buildings, structures, fixtures, facilities, building systems, and
equipment included in the Real Property or located thereon (the “Improvements”).

 

(c)     The Company and each Subsidiary has good, valid and marketable fee
simple title to all Owned Real Property, free and clear of all Liens, except for
(i) Permitted Liens and (ii) mortgages and other Liens against the Real Property
as set forth in Section 4.7(c) of the Company Disclosure Letter. Each of the
Company and each Subsidiary has good and valid leasehold interest in and to all
Leased Real Property. Each of the Real Property Leases is, with respect to the
Company and the respective Subsidiary, legal, valid, binding, enforceable, and
in full force and effect.

 

(d)     The transactions contemplated by this Agreement (i) do not, except as
set forth in Section 4.7(d)(i) of the Company Disclosure Letter, require the
consent of any other party to any Real Property Lease and (ii) will not,
assuming receipt of each of the consents set forth on Section 4.7(d)(i) of the
Company Disclosure Letter, result in a breach of or default under any Real
Property Lease or otherwise cause any Real Property Lease to cease to be legal,
valid, binding, enforceable and in full force and effect on identical terms
following the Closing. None of the Company, any Subsidiary or any other parties
to the Real Property Leases are in default under any of the terms thereof; all
obligations and conditions under the Real Property Leases to be performed to
date have been satisfied; and no event has occurred which, with the giving of
notice or the passage of time, or both, would constitute a default under any of
the Real Property Leases. No party to any Real Property Leases has given notice
to early terminate any such Real Property Lease or, to the Knowledge of the
Company, expressed any intention to do so. The Company and the Subsidiaries have
complied and continue to comply with all applicable Laws with respect to the use
of the Leased Real Property.

 

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(e)     To the Knowledge of the Company, all Improvements are in good condition
and repair, subject to ordinary wear and tear, and are adequate for the conduct
of the business of the Company as currently conducted. To the Knowledge of the
Company, there are no facts or conditions affecting any of the Improvements that
would interfere in any material respect with the use or occupancy of the
Improvements or any portion thereof in the operation of the business of the
Company as currently conducted.

 

(f)     To the Knowledge of the Company, except as set forth in Section 4.7(f)
of the Company Disclosure Letter, there are no use or occupancy restrictions
that would reasonably be expected to materially interfere with the use of any
Real Property in connection with the business of the Company as currently
conducted. With respect to the Owned Real Property, and, to the Knowledge of the
Company, with respect to the Leased Real Property, no assessment for public
improvement or otherwise that is due and remains unpaid has been made against
the Real Property other than (i) Tax Liens, assessments, water and sewer rents
and other governmental charges not yet due and payable or being contested in
good faith by appropriate proceedings, and (iii) other non-monetary Liens of a
minor nature that do not, individually or in the aggregate, in any material
respect interfere with or impair the continued use of the Real Property in the
ordinary course of business consistent with past practice (collectively, the
items referred to in clauses (i)-(ii) are “Permitted Liens”), and to the
Knowledge of the Company, there is no currently proposed or pending assessment
for public improvements or otherwise.

 

(g)     The Company has not received any written notice from any insurance
company of (i) any material defects or inadequacies in the Real Property or any
part thereof, that would materially and adversely affect the insurability of the
same or (ii) any termination or threatened termination of any policy of
insurance relating to the Real Property.

 

(h)     With respect to each parcel of Real Property:

 

(i)     there are no pending or, to the Knowledge of the Company, threatened
condemnation or expropriation proceedings, lawsuits, proceedings, investigations
or administrative actions relating to the Real Property or any part thereof or
other legal matters affecting adversely the current use, occupancy or value
thereof;

 

(ii)     to the Knowledge of the Company, all Improvements have been operated
and maintained in accordance with applicable Law;

 

(iii)     there are no oral or written leases, subleases, licenses, concessions
or other agreements, written or oral, granting to any party or parties (other
than the Company or any of its Subsidiaries) the right of use or occupancy of
any portion of the Real Property;

 

(iv)     there are no outstanding options or rights of first refusal to purchase
the Owned Real Property, or any portion thereof or interest therein;

 

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(v)     except as set forth in Section 4.7(h)(v) of the Company Disclosure
Letter, the Real Property is supplied with utilities and other services,
including gas, electricity, water, telephone, sanitary sewer and storm sewer,
adequate for the operation of the business of the Company as currently
conducted; and

 

(vi)     except as set forth in Section 4.7(h)(vi) of the Company Disclosure
Letter, the Real Property has vehicular access to a public road, and access to
the property is provided by paved public right-of-way with adequate curb cuts
available.

 

Section 4.8     Absence of Certain Events. Since the date of the Interim
Financial Statements, the business of the Company and the Subsidiaries has been
operated in the ordinary course and the Company and the Subsidiaries have not
suffered any change in its business, assets, liabilities, financial condition or
results of operations that has had or is reasonably likely to have a Company
Material Adverse Effect. Except as otherwise specifically contemplated by this
Agreement or as set forth in Section 4.8 of the Company Disclosure Letter, there
has not been since the date of the Interim Financial Statements:

 

(a)     any labor dispute;

 

(b)     any material change in the accounting policies or practices of the
Company or any Subsidiary;

 

(c)     any material damage, destruction or loss, whether covered by insurance
or not;

 

(d)     any new, or amendment to any existing, employment, severance or
consulting Contract, the implementation of, or any agreement to implement, any
increase in benefits with respect to any Employee Benefit Plans, any new, or
amendment to any existing, Employee Benefit Plan, or any alteration of any of
the Company’s employment practices or terms and conditions of employment, in
each case other than as required by Law;

 

(e)     any issuance by the Company or any Subsidiary of any shares of capital
stock, membership interests or other equity interests (or any warrants, rights
or other securities convertible therefor), or any repurchase or redemption by
the Company or any Subsidiary of any shares of its capital stock or membership
interests or other equity interests, as applicable, or any split, combination or
reclassification of any such shares, membership interests or other equity
interests;

 

(f)     any sale, lease or other disposition of, or execution and delivery of
any agreement by the Company or any of its Subsidiaries contemplating the sale,
lease or other disposition of, material properties and assets of the Company or
any of its Subsidiaries other than in the ordinary course of business;

 

(g)     any merger or consolidation of the Company or any Subsidiary with any
other Person or any acquisition by the Company or any Subsidiary of the stock or
other equity interests or business of another Person, or any action taken or any
commitment entered into with respect to or in contemplation of any liquidation,
dissolution, recapitalization, reorganization or other winding up of the
business or operation of the Company or any Subsidiary;

 

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(h)     any borrowing, agreement to borrow funds or assumption, endorsement or
guarantee of indebtedness by the Company or any Subsidiary or any termination or
material amendment of any evidence of indebtedness, contract, agreement, deed,
mortgage, lease, license or other instrument, commitment or agreement to which
the Company or any Subsidiary is bound or by which any of its properties is
bound other than in the ordinary course of business and consistent with past
practices and other than borrowings under the Company’s existing credit
facilities;

 

(i)     any declaration or payment of any dividend on, or any other distribution
with respect to, the Company Capital Stock;

 

(j)     any Lien imposed on any of the assets, tangible or intangible, of the
Company or any Subsidiary other than Permitted Liens;

 

(k)     any inability of the Company or any Subsidiary to pay its debts as they
have become due, any voluntary or involuntary filing for bankruptcy, insolvency
or reorganization of the Company or any Subsidiary and neither the Company, nor
to the Knowledge of the Company, any other Person, presently intends to make a
filing relating to the bankruptcy, insolvency or reorganization of the Company;

 

(l)     other than the granting of non-exclusive use licenses in connection with
the sale or license of any Product in the ordinary course of business, any (i)
transfer or assignment of, or grant of any license or sublicense under or with
respect to, any Intellectual Property of the Company or any Subsidiary, or (ii)
entry into or amendment or termination of any Contract for the sale or purchase
of Intellectual Property or any joint development or similar agreement;

 

(m)     any abandonment or lapse of or failure to maintain in full force and
effect any Registered IP or applications for Pending IP, or failure to take or
maintain reasonable measures to protect the confidentiality or value of any
trade secrets included in the Intellectual Property of the Company and the
Subsidiaries;

 

(n)     any acceleration, termination, material modification to or cancellation
of any material Contract (including, but not limited to, any Company Contract)
to which the Company or a Subsidiary is a party or by which it is bound;

 

(o)     any action by the Company or any Subsidiary to make, change or rescind
any material Tax election, amend any Tax Return, take any action or enter into
any other transaction that would have the effect of increasing the Tax liability
of the Company or any Subsidiary in respect of any Post-Closing Tax Period;

 

(p)     any amendment of the Company Charter, Company Bylaws or any
organizational/constituent documents of any Subsidiary;

 

(q)     any material change in the Company’s cash management practices and its
policies, practices and procedures with respect to collection of accounts
receivable, establishment of reserves for uncollectible accounts, accrual of
accounts receivable, inventory control, prepayment of expenses, payment of trade
accounts payable, accrual of other expenses, deferral of revenue and acceptance
of customer deposits;

 

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(r)     any material capital expenditures; or

 

(s)     any agreement to do any of the foregoing.

 

Section 4.9     Litigation. Except as set forth in Section 4.9 of the Company
Disclosure Letter, there are no actions, suits, complaints, charges,
proceedings, orders or claims pending or, to the Knowledge of the Company,
threatened against the Company or any Subsidiary at law or in equity, or before
or by any Governmental Authority (including any actions, suits, complaints or
proceedings with respect to the transactions contemplated by this Agreement but
specifically excluding any actions, suits, complaints or proceedings before or
by any Governmental Authority related to or arising under any Competition Law in
connection with the transactions contemplated by this Agreement or related to or
arising under competition or merger control filings made in connection with the
transactions contemplated by this Agreement), nor, to the Knowledge of the
Company, have there been any such actions, suits, proceedings, orders or claims
pending against the Company or any Subsidiary since October 1, 2014. Neither the
Company nor any Subsidiary is subject to any grievance arbitration or other
proceedings or any investigations or inquiries by a Governmental Authority
(excluding any proceedings, investigations, or inquiries by any Governmental
Authority related to or arising under any Competition Law in connection with the
transactions contemplated by this Agreement or related to or arising under
competition or merger control filings made in connection with the transactions
contemplated by this Agreement). Neither the Company nor any Subsidiary is a
party to any judgment, penalty, award, order or decree of any court or other
Governmental Authority (or settlement enforceable therein the terms of which
have not been satisfied in full). There are no investigations by any
Governmental Authority pending or, to the Knowledge of the Company, threatened
against the Company or any Subsidiary (excluding any investigations by any
Governmental Authority related to or arising under any Competition Law in
connection with the transactions contemplated by this Agreement or related to or
arising under competition or merger control filings made in connection with the
transactions contemplated by this Agreement) and there has been no such
investigation since October 1, 2014. Notwithstanding the foregoing, for all
purposes of the Agreement, the Company does not make any representation or
warranty (pursuant to this Section 4.9 or elsewhere in the Agreement) regarding
the effect of the applicable Competition Laws on its ability to execute,
deliver, or perform its obligations under this Agreement or to consummate the
transactions described in this Agreement as a result of the enactment,
promulgation, application, or threatened or actual judicial or administrative
investigation or litigation under, or enforcement of, any Competition Law with
respect to the consummation of the transactions described in this
Agreement.     

 

Section 4.10     Employee Benefit Plans.

 

(a)     Section 4.10(a) of the Company Disclosure Letter sets forth a true and
complete list of each Employee Benefit Plan. The Company has delivered to Parent
true and complete copies of each Employee Benefit Plan, (or, in the case of an
unwritten Employee Benefit Plan, a written summary of the material terms
thereof), including a true and complete copy of (i) the three most recent annual
reports (Form 5500) filed with the IRS and/or Department of Labor, if
applicable, (ii) the three most recent actuarial valuation reports, if
applicable, (iii) each plan document, trust agreement or related documents
setting forth the terms of such Employee Benefit Plan as well as insurance
contracts, administrative services agreements and other documents required under
ERISA with respect to each Employee Benefit Plan, (iv) the most recent summary
plan description, (v) where applicable, the most recent determination letter
issued by the IRS, and (v) and any material correspondence to or from any
Governmental Authority with respect to any Employee Benefit Plan in the last
three (3) years.

 

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(b)     (i) Each Employee Benefit Plan that is an “employee pension benefit
plan” within the meaning of Section 3(2) of ERISA that is intended to be
qualified under Section 401(a) of the Code (the “Qualified Plans”) is so
qualified, has been and is being operated and administered in compliance with
Section 401(a) of the Code, and a favorable determination letter has been
obtained from the IRS for each Qualified Plan to the effect that such Employee
Benefit Plan satisfies the requirements of Section 401(a) of the Code and that
its related trust is exempt from taxation under Section 501(a) of the Code, or
is being requested and there are no facts or circumstances that could reasonably
be expected to cause the loss of any such qualification or the imposition of
liability, penalty or tax under ERISA, the Code or other applicable laws
(including the rules and regulations under any of them); (ii) no Employee
Benefit Plan is, and neither the Company nor any Subsidiary or any of their
ERISA Affiliates has ever contributed to, or been obligated to contribute to, or
had any liability with respect to, a “multiemployer plan” within the meaning of
Sections 3(37) or 4001(a)(3) of ERISA, a “multiple employer plan” as described
in Section 413(c) of the Code, a “multiple employer welfare arrangement” within
the meaning of Section 3(40) of ERISA, a “voluntary employees’ beneficiary
association” within the meaning of Section 501(c)(9) of the Code or other
funding arrangement for the provision of welfare benefits (such disclosure to
include the amount of any such funding), a “defined benefit plan” as defined in
Section 3(35) of ERISA or a pension plan subject to Title IV of ERISA or the
funding standards of Section 302 of ERISA or Sections 412 and 436 of the Code,
and neither the Company nor any Subsidiary or any of their ERISA Affiliates has
previously maintained or had an obligation to contribute to any such plans;
(iii)  there has been no non-exempt “prohibited transaction” within the meaning
of Section 406 of ERISA or Section 4975 of the Code involving any Employee
Benefit Plan; (iv) as of and through the Closing, all required contributions,
distributions, reimbursements and premiums required by and due under the terms
of each Employee Benefit Plan will have been made or, to the extent not yet due,
accrued in the Financial Statements; (v) each Employee Benefit Plan has been
established, maintained, funded and administered in material compliance with the
applicable provisions of ERISA, the Code, other applicable Laws and the terms of
such Employee Benefit Plan; (vi) there are no pending or, to the Knowledge of
the Company, threatened investigations or claims by the IRS, the U.S. Department
of Labor, the Pension Benefit Guaranty Corporation or any other Governmental
Authority relating to any Employee Benefit Plans; (vii) no Employee Benefit Plan
is self-insured by the Company or any Subsidiary; and (viii) there are no
pending or, to the Knowledge of the Company, threatened termination proceedings,
(except claims for benefits payable in the normal operation of the Employee
Benefit Plans), suits or proceedings against or involving any Employee Benefit
Plan or asserting any rights to or claims for benefits under any Employee
Benefit Plan.

 

(c)     Except as set forth in Section 4.10(c) of the Company Disclosure Letter,
neither the Company nor any Subsidiary or any of their ERISA Affiliates has any
obligation to provide welfare benefits following termination of employment to
any present or former employee, director, independent contractor, leased
employee, officer or other service provider or the spouse, dependents or
beneficiaries of any present or former employee, non-employee director or other
service provider other than those benefits required under Section 4980B of the
Code and Sections 601 et seq. of ERISA (“COBRA”) or similar state laws.

 

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(d)     Section 4.10(d) of the Company Disclosure Letter sets forth each
Employee Benefit Plan that is a nonqualified deferred compensation plan, within
the meaning of and not exempt from Section 409A of the Code (each, a “Section
409A Plan”) and identifies each Section 409A Plan in connection with which the
Company, any Subsidiary or their successors may have liability with respect to
current or former employees, directors, independent contractors, leased
employees, officers or other service providers. No such plan has assets set
aside directly or indirectly in the manner described in Section 409A(b)(1) of
the Code or contains a provision that would be subject to Section 409A(b)(2) of
the Code. Each Section 409A Plan has been administered in all material respects
with its terms and the requirements of Section 409A of the Code and applicable
guidance issued thereunder and has been established and maintained in written
form that complies in all material respects with the requirements of Section
409A of the Code and final regulations issued and outstanding thereunder, such
that in the event of an audit by the Internal Revenue Service of either the
Company, any Subsidiary or any individual participating in such Employee Benefit
Plan, the additional Tax described in Section 409A(a)(1)(B) of the Code would
not be assessed against any such participant with respect to benefits due or
accruing under such Employee Benefit Plan.

 

(e)     All individuals performing services or who have performed services for
the Company, any Subsidiary or any of their ERISA Affiliates and who are or were
treated by the Company, any Subsidiary or any such ERISA Affiliate as
independent contractors have been appropriately classified as such under all
applicable legal requirements, and no such individuals participate or have the
right to participate in any Employee Benefit Plan with respect the Company, any
Subsidiary or any of their ERISA Affiliates. No employee of the Company or any
Subsidiary is a “leased employee” within the meaning of Section 414(n) of the
Code.

 

(f)     Except as set forth in Section 4.10(f) of the Company Disclosure Letter,
each Employee Benefit Plan may be amended or terminated as of or after the
Closing without resulting in any material liability to the Company or any
Subsidiary or to any of their affiliates for any additional contributions,
penalties, premiums, fees, fines, excise taxes, or any other charges or
liabilities, except for ordinary administration expenses.

 

(g)     Neither the Company nor any Subsidiary or any of their ERISA Affiliates
has contributed to a nonconforming group health plan (as defined under Section
5000(c) of the Code), or incurred a Tax under Section 5000(a) of the Code. The
Company does not maintain any plan that is an “employee welfare benefit plan”
(as such term is defined under Section 3(1) of ERISA) that has provided any
“disqualified benefit” (as such term is defined in Section 4976(b) of the Code)
with respect to which an excise tax could be imposed under Section 4976 of the
Code. The Company, each Subsidiary and each of their ERISA Affiliates has
complied in all material respects with the requirements of the Patient
Protection and Affordable Care Act and the Health Care and Education
Reconciliation Act of 2010, as amended, COBRA, and in each case the regulations
promulgated thereunder, with respect to each Employee Benefit Plan to the extent
applicable to such plan.

 

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(h)     Prior to the Closing Date, the Company shall have made all contributions
required to be made to each Employee Benefit Plan as of the Closing Date and
paid or accrued all liabilities with respect to the administration or
termination of any such plan, liabilities with respect to any retiree’s, former
employee’s, consultant’s or director’s employment or service with the Company,
liabilities with respect to any individual receiving continuation of coverage
benefits in accordance with the provisions of COBRA and State benefits
continuation laws, and any accrued but unpaid claim, whether known or unknown as
of the Closing, under any such plan. All contributions that are due have been
made within the time periods prescribed by ERISA and the Code to each such
Employee Benefit Plan that is an employee pension benefit plan (as defined in
Section 3(2) of ERISA), and all contributions for any period ending on or before
the Closing that are not yet due have been made to each such employee pension
benefit plan or accrued in accordance with the past custom and practice of the
Company.

 

(i)     Except as set forth in Section 4.10(i) of the Company Disclosure Letter,
neither the execution and delivery of this Agreement nor the consummation of the
transactions contemplated hereby will (either alone or in combination with
another event): (i) result in any payment becoming due, or increase the amount
of any compensation due, to any current or former employee, director,
independent contractor, leased employee, officer or other service provider of
the Company or any Subsidiary; (ii) increase any benefits otherwise payable
under any Employee Benefit Plan; (iii) result in the acceleration of the time of
payment or vesting of any such compensation or benefits; (iv) result in the
payment of any amount that could, individually or in combination with any other
such payment, constitute an “excess parachute payment,” as defined in 280G(b)(1)
of the Code; or (v) result in the triggering or imposition of any restrictions
or limitations on the rights of the Company to amend or terminate any Employee
Benefit Plan.

 

(j)     With respect to each Employee Benefit Plan that is subject to the Law of
any jurisdiction other than the United States (a “Foreign Benefit Plan”): (i)
all employer and employee contributions to each Foreign Benefit Plan required by
Law or by the terms of such Foreign Benefit Plan have been made or, if
applicable, accrued in accordance with normal accounting practices; (ii) the
fair market value of the assets of each funded Foreign Benefit Plan, the
liability of each insurer for any Foreign Benefit Plan funded through insurance
or the book reserve established for any Foreign Benefit Plan, together with any
accrued contributions, is sufficient to procure or provide for the accrued
benefit obligations with respect to all current and former participants in such
plan according to the actuarial assumptions and valuations most recently used to
determine employer contributions to such Foreign Benefit Plan; (iii) all Foreign
Benefit Plans have been maintained in accordance with their terms and all
requirements of applicable Law; (iv) each Foreign Benefit Plan required to be
registered has been registered and has been maintained in good standing with the
appropriate Governmental Authority; and (v) to the extent any Foreign Benefit
Plan is intended to qualify for special Tax treatment, such Foreign Benefit Plan
meets all requirements for such treatment.

 

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(k)     Neither the Company nor any Subsidiary is a party to, or otherwise
obligated under, any Contract, agreement, plan or arrangement that provides for
the gross-up of Taxes imposed by Section 4999 or Section 409A of the Code.

 

(l)     Section 4.10(l) of the Company Disclosure Letter contains a complete and
accurate listing of the name (if an entity, including the name of the
individuals employed by or providing service on behalf of such entity) and
contact information of each independent contractor, consultant, freelancer or
other service provider (collectively, “Contractors”) used by the Company or any
Subsidiary at any point during the prior three years. A copy of each contract
relating to the services a Contractor provides to the Company has been provided
to Parent. To the Knowledge of the Company, no Contractor used by the Company or
any Subsidiary is a party to, or is otherwise bound by, any agreement or
arrangement with any third party, including any confidentiality or
non-competition agreement, that in any way adversely affects or restricts the
performance of such Contractor’s duties for the Company or any Subsidiary. To
the Knowledge of the Company, no current Contractor used by the Company or any
Subsidiary intends to terminate his or her or its relationship with the Company
or any Subsidiary. The Company has no obligation or liability with respect to
any Taxes (or the withholding thereof) in connection with any Contractor.

 

Section 4.11     Labor and Employment Matters.

 

(a)     Except as set forth in Section 4.11(a) of the Company Disclosure Letter,
neither the Company nor any Subsidiary is a party to or bound by any collective
bargaining agreement or other agreement or obligation of any sort with any labor
union or works council and no union or other collective bargaining unit or
employee organizing entity has been certified or recognized by the Company or
any Subsidiary as representing any of its employees. Except as set forth in
Section 4.11(a) of the Company Disclosure Letter, neither the Company nor any
Subsidiary has at any time during the last three years had, nor to the Knowledge
of the Company, is there now threatened, any strikes or other work stoppages
involving any employees of the Company or any Subsidiary and there are no
material labor disputes by any labor organization in progress or pending or, to
the Knowledge of the Company, threatened against the Company or any Subsidiary.
Neither the Company nor any Subsidiary has encountered any labor union
organizing activity, nor had any actual, or to the Knowledge of the Company,
threatened employee strikes, work stoppages, slowdowns or lockouts. Neither the
Company nor any Subsidiary has engaged in unfair labor practices (within the
meaning of the National Labor Relations Act or comparable state law), and there
are no charges of unfair labor practices pending before any Governmental
Authority involving or affecting the Company or any Subsidiary. No
investigation, review, complaint or proceeding by any Governmental Authority or
current or former Employee in relation to any actual or alleged violation of any
Labor Laws is pending or, to the Knowledge of the Company, threatened, nor has
the Company or any Subsidiary received any notice from any Governmental
Authority or current or former Employee indicating an intention to conduct the
same.

 

(b)     The Company or a Subsidiary has, or will have no later than the Closing
Date, paid all accrued salaries, bonuses, commissions, wages and severance pay
of the Employees due to be paid through the Closing Date. The Company and each
Subsidiary is, and has been for the past five years, in compliance with all
applicable Laws in respect of employment of labor, including but not limited to,
all such laws relating to wages, hours, affirmative action, collective
bargaining, discrimination, civil rights, safety and health, immigration, health
or welfare conditions relating to premises occupied, workers’ compensation and
the collection, and payment of withholding and/or Social Security Taxes and
similar Taxes, including, but not limited to, the Age Discrimination in
Employment Act, as amended, Title VII of the Civil Rights Act of 1964, as
amended, the Civil Rights Act of 1991, the Employee Retirement Income Security
Act, the Fair Labor Standards Act (29 U.S.C. 201, et seq.) (“FLSA”), the
Americans with Disabilities Act, the Sarbanes-Oxley Act of 2002, the Worker
Adjustment and Retraining Notification Act, as amended, the Occupational Safety
and Health Act, as amended, the Family Medical and Leave Act (29 U.S.C. 2601, et
seq.), as amended, the National Labor Relations Act of 1935, as amended,
Executive Order 11246 and any other executive orders or regulations governing
affirmative action, EEO and VETS-100 reporting obligations, the Immigration
Nationality Act (8 U.S.C. 1324a, et seq.), as amended, and all similar
applicable Laws (collectively the “Labor Laws”). The Company and the
Subsidiaries have maintained adequate and suitable records regarding the service
of each Employee including records of working time. Except as set forth on
Section 4.11(b) of the Company Disclosure Letter, the Company and the
Subsidiaries have properly classified their Employees pursuant to the FLSA. The
Company and the Subsidiaries have withheld all amounts and/or has fully paid
such amounts to Governmental Authorities or other competent authorities as
required by Law or agreement to be withheld from the wages or salaries of, or
other amounts or benefits paid to, their Employees and are not liable for the
payment of any arrears of wages or other Taxes, penalties, fines or other
compensation of any kind, however designated, for failure to comply with any of
the foregoing. Neither the Company nor any Subsidiary is, or in the last three
years has been, a government contractor or a party to any government contract.

 

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(c)     The Company has provided or made available to Parent the information for
employees of the Company and each Subsidiary and those working for the Company
or a Subsidiary through a professional employer organization (each, an
“Employee”) as of December 26, 2017, including for each such Employee: name, job
title, Fair Labor Standards Act designation, work location (identified by street
address), current compensation paid or payable, all wage arrangements, fringe
benefits (other than employee benefits applicable to all employees) and visa and
green card application status. To the Knowledge of the Company, no employee is a
party to, or is otherwise bound by, any agreement or arrangement, including any
confidentiality or non-competition agreement, that in any way adversely affects
or restricts the performance of such Employee’s duties. Each current and former
Employee involved in the development of the Company Intellectual Property has
executed a nondisclosure and assignment-of-rights agreement for the benefit of
the Company that, to the extent permitted by applicable Laws, vest all rights in
work product created by the Employee during the Employee’s employment or
affiliation with the Company. To the Knowledge of the Company, no Employee
intends to terminate his or her employment with the Company or a Subsidiary.

 

(d)     Except as set forth in Section 4.11(d) of the Company Disclosure Letter,
each Employee working in the United States is (i) a United States citizen, (ii)
a lawful permanent resident of the United States, or (iii) an alien authorized
to work in the United States either specifically for the Company or for any
United States employer. The Company and each Subsidiary is in compliance in all
material respects with applicable Law, has completed a Form I-9 (Employment
Eligibility Verification) for each Employee and each such Form I-9 has since
been updated as required by applicable Law and is correct and complete as of the
date hereof. With respect to each Employee, an authorized official of the
Company has reviewed the original documents relating to the employment
eligibility and authorization of such Employee to be employed in the United
States in compliance with applicable Law and such documents appeared, to such
official, to be genuine on their face.

 

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(e)     Section 4.11(e) of the Company Disclosure Letter contains a true and
complete list of any and all employment, change in control, severance,
retention, termination non-competition, non-solicitation and other similar
employment agreements, arrangements or policies, whether written or oral,
between the Company or a Subsidiary, on the one hand, and any individual, on the
other hand, other than at-will employment arrangements but including all
agreements, arrangements or policies that affect at-will employees.

 

(f)     No employee, temporary employee or contract employee of the Company or
any Subsidiary is, or within the last five years has been, subject to any
practice prohibited by the U.K. Modern Slavery Act.

 

Section 4.12     Tax Matters.

 

(a)     All Income Tax Returns and other material Tax Returns required to be
filed by the Company and the Subsidiaries have been timely filed (taking into
account applicable extensions of time to file) with the appropriate Taxing
Authority, and all such Tax Returns are complete, correct and accurate in all
material respects and have been completed in accordance with applicable Law. All
Taxes required to be paid by the Company and the Subsidiaries have been timely
paid. No written claim has been made by a Tax Authority in a jurisdiction where
the Company or a Subsidiary does not file Tax Returns that such entity is or may
be subject to taxation by that jurisdiction.

 

(b)     No claim or deficiency for any Taxes has been proposed, asserted or
assessed in writing by any Taxing Authority against the Company or any
Subsidiary, which remains unresolved or unpaid. There are no Proceedings
currently ongoing or pending, or threatened in writing, with respect to any
Taxes or Tax Returns of or with respect to the Company and the Subsidiaries.
There are no waivers or extensions of any statute of limitations currently in
effect with respect to Taxes or Tax Returns of the Company and the Subsidiaries
(other than extensions that arise as a result of filing Tax Returns by the
extended due date therefor). Neither the Company nor any Subsidiary has granted
any Person any power of attorney that is currently in force with respect to any
Taxes or Tax Returns (other than authorizations to contact Tax Return preparers
that were included in Tax Returns filed by or on behalf of the Company and each
Subsidiary). Schedule 4.12(b) provides a complete list of such authorized Tax
Return preparers, their contact information and the respective Tax Returns for
which they are authorized.

 

(c)     There are no Tax Liens upon the assets of the Company and the
Subsidiaries, except for statutory Tax Liens not yet due and payable or for
Taxes that are being disputed in good faith by appropriate proceedings and with
respect to which adequate reserves have been established in accordance with
GAAP.

 

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(d)     All Taxes required to be withheld or collected by the Company and the
Subsidiaries have been withheld and collected and, to the extent required by
Law, timely paid to the appropriate Tax Authority. The Company and each
Subsidiary has complied in all material respects with all information reporting
requirements related to such withholding.

 

(e)     There is no outstanding closing agreement, ruling request, request to
consent to change a method of accounting, subpoena or request for information
with or by any Tax Authority with respect to the Company or the Subsidiaries.

 

(f)     The Company and the Subsidiaries have not entered into, participated in,
or otherwise engaged in any transaction that constitutes a “reportable
transaction” as defined in Treasury Regulations Section 1.6011-4(b). The Company
and the Subsidiaries have disclosed on their Tax Returns each position taken on
such Tax Returns that could give rise to a substantial understatement of Tax
within the meaning of Section 6662 of the Code.

 

(g)     Neither the Company nor any Subsidiary has been a member of an
affiliated group filing a consolidated federal Income Tax Return (other than a
group the common parent of which was or is the Company) or any similar group for
state, local or non-U.S. income Tax purposes. Neither the Company nor any
Subsidiary has any liability for the Taxes of any Person (other than a group the
common parent of which was or is the Company) under Treasury Regulations Section
1.1502-6 (or any similar provision of any state, local or non-U.S. Law), as a
transferee or successor, by contract or otherwise.

 

(h)     Except with respect to any Commercial Tax Agreement, neither the Company
nor any Subsidiary is a party to, or is bound by, or has any obligation under,
any Tax allocation or sharing agreement or similar contract or arrangement or
any agreement that obligates it to make any payment computed by reference to the
Taxes of any other Person.

 

(i)     Neither the Company nor any Subsidiary has constituted either a
“distributing corporation” or a “controlled corporation” (within the meaning of
Section 355(a)(1)(A) of the Code) in a distribution of stock qualifying for
tax-free treatment under Section 355 of the Code in the five years prior to the
date of this Agreement.

 

(j)     Neither the Company nor any Subsidiary will be required to include any
material item of income in, or exclude any material item of deduction from,
taxable income for any taxable period (or portion thereof) ending after the
Closing Date as a result of any (i) erroneous method of accounting or change in
method of accounting made prior to the Closing Date for a taxable period ending
on or prior to the Closing Date, including by reason of the application of
Section 481 of the Code (or any analogous provision of state, local or non-U.S.
law), (ii) “closing agreement” as described in Section 7121 of the Code (or any
corresponding or similar provision of state, local or non-U.S. law) executed on
or prior to the Closing Date, (iii) installment sale or open transaction
disposition made on or prior to the Closing Date, (iv) prepaid amount received
on or prior to the Closing Date, or (v) election under Section 108(i) of the
Code.

 

(k)     Neither the Company nor any Subsidiary will be required to include any
material item of income in, or exclude any material item of deduction from,
taxable income for any taxable period (or portion thereof) ending after the
Closing Date as a result of any intercompany transaction described in Treasury
Regulations Section 1.1502-13, or excess loss account described in Treasury
Regulations Section 1.1502-19.

 

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(l)     Neither the Company nor any Subsidiary has been a United States real
property holding corporation within the meaning of Section 897(c)(2) of the Code
during the applicable period specified in Section 897(c)(1)(A) of the Code.

 

(m)     Other than in the United States and in any jurisdiction in which the
Company or a Subsidiary is already making all Tax filings required by applicable
Law, neither the Company nor any Subsidiary is subject to income Tax by virtue
of having a permanent establishment or other place of business in that country.

 

Section 4.13     Compliance with Law; Permits.

 

(a)     Except as set forth in Section 4.13(a) of the Company Disclosure Letter,
the Company and each of its Subsidiaries is, and has been since December 31,
2014, in compliance in all material respects with all applicable Laws by which
its business, properties or assets are bound or subject, and no notice or claim
of a violation of such Laws has been received by the Company or has been filed,
commenced or, to the Knowledge of the Company, threatened in writing against the
Company or any of its Subsidiaries since December 31, 2014, alleging any such
failure of compliance.

 

(b)     Section 4.13(b) of the Company Disclosure Letter lists all current
material Permits issued to and held by the Company or any Subsidiary, including
the names of the Permits and their respective dates of issuance and expiration.
The Company and each of its Subsidiaries is in possession of all Permits
necessary to own, lease and operate its properties and to carry on its business
as it is now being conducted and all of such Permits are in full force and
effect, not subject to appeal, and no revocation, suspension, material
modification or cancellation of any of such Permits is pending or, to the
Knowledge of the Company, threatened. All fees and charges with respect to the
Permits held by the Company and the Subsidiaries as of the date hereof have been
paid in full.

 

(c)     None of the Company, any Subsidiary or any employee, Company
Stockholder, director, officer or Affiliate, or to the Knowledge of the Company,
any consultant, agent and other Person operating for the benefit of the Company
or the Subsidiary has taken any action (including with respect to obtaining
Permits or effecting other transactions with any Governmental Authority) in
violation of, or that is, or could be deemed to be, a violation of the
applicable anti-bribery, anti-money laundering or similar such Laws of any
jurisdiction in which the Company or any Subsidiary conducts its business, the
principles described in the Convention on Combating Bribery of Foreign Public
Officials in International Business Transactions, signed in Paris on December
17, 1997, which entered into force on February 15, 1999, and the Convention’s
commentaries, the U.S. Foreign Corrupt Practices Act (the “FCPA”) or any statute
similar to the FCPA enforced by competent Governmental Authorities.

 

(d)     Neither the Company nor any Subsidiary nor any Company Stockholder,
employee, director, officer or Affiliate, or to the Knowledge of the Company,
any consultant, agent or other Person operating for the benefit of the Company
or any such Subsidiary has, directly or indirectly, offered or given, on behalf
of the Company or any Subsidiary, anything of value to: any official, political
party or party official thereof or any candidate for political office in any
country or jurisdiction; or any Person, while knowing that all or a portion of
such thing of value will be offered, given, or promised, directly or indirectly,
to any official, political party or party official within any country or
jurisdiction, or to any candidate for political office within any country or
jurisdiction for the purpose of, in either the case of clauses (i) or (ii)
above, the following: (A) influencing any act or decision of such official,
political party, party official, or candidate to do any act in violation of the
lawful duty of such official, political party, party official, or candidate, or
securing any improper advantage, or (B) inducing such official, political party
or party official thereof, or any such candidate for political office to affect
or influence any act or decision of any Governmental Authority, in order to
assist the Company or any Subsidiary in obtaining or retaining business for or
with, or directing business to, any Person.

 

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(e)     None of the Company, any Subsidiary or any employee, Company
Stockholder, director, officer or Affiliate, or to the Knowledge of the Company,
any consultant, agent and other Person operating for the benefit of the Company
or the Subsidiary has engaged in any business or effected any transactions with
any Person located in the Balkans, Belarus, Burma (Myanmar), Cote d’Ivoire
(Ivory Coast), Cuba, Democratic Republic of the Congo, Iraq, Iran, Liberia,
North Korea, Sudan, Syria, or Zimbabwe (or any other sanctioned country or
region as may be amended, from time to time by the U.S. Department of Treasury’s
Office of Foreign Assets Control (“OFAC”), collectively, the “Restricted
Nations”); that is owned, controlled by or acting on behalf of an individual,
business or organization in a Restricted Nation; that is a government of a
Restricted Nation; that is owned, controlled by or acting on behalf of a
government of a Restricted Nation; or that is on OFAC’s list of Specially
Designated Nationals or the U.S. Department of Commerce’s Bureau of Industry and
Security’s or the Department of State’s Directorate of Defense Trade Controls’
lists of denied persons, as each may be amended from time to time..

 

(f)     None of the Company, any Subsidiary or any employee, Company
Stockholder, director, officer or Affiliate, or to the Knowledge of the Company,
any consultant, agent and other Person operating for the benefit of the Company
or the Subsidiary has taken any action that is, or could be deemed to be, a
violation of applicable U.S. or foreign Laws related to participation in
unsanctioned foreign boycotts, except as set forth in Section 4.13(f) of the
Company Disclosure Letter, the import and export of goods, equipment, materials,
software, technology, and services, including, but not limited to all applicable
licensing, recordkeeping, and reporting requirements of the Export
Administration Act, 50 U.S.C. app. §§ 2401-2420, the Ribicoff Amendment to the
Tax Reform Act of 1976 (codified at 26 U.S.C. § 999), and the Export
Administration Regulations, 15 C.F.R. Part 730 et seq., or applicable
certification, permitting, reporting, and recordkeeping requirements concerning
the importation of products.

 

Section 4.14     Transactions with Affiliates. Except as set forth in Section
4.14 of the Company Disclosure Letter, neither the Company nor any Subsidiary
has, in the ordinary course of business or otherwise, purchased, leased or
otherwise acquired any material property or assets or obtained any material
services from, or sold, leased or otherwise disposed of any material property or
assets or provided any material services to (except with respect to remuneration
for services rendered in the ordinary course as a director, officer or employee
of the Company),  any Company Stockholder,  any director, officer or employee of
the Company or any Subsidiary,  any natural person or other Person that directly
or indirectly controls, is controlled by or is under common control with the
Company or  to the Knowledge of the Company, any member of the immediate family
of any of such natural persons (each, a “Company Affiliate”). The Company
Contracts do not include any obligation or commitment between the Company or any
Subsidiary, on the one hand, and any Company Affiliate, on the other hand, and
the assets of the Company and the Subsidiaries do not include any receivable or
other obligation or commitment from any Company Affiliate to the Company or any
Subsidiary and no Company Affiliate has any interest in any material property,
real or personal, tangible or intangible, used in or pertaining to the business
of the Company, except for the rights of a Company Stockholder solely in its
capacity as a stockholder.

 

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Section 4.15     Absence of Undisclosed Liabilities. Except as set forth on
Section 4.15 of the Company Disclosure Letter, the Company and the Subsidiaries
do not have any liabilities or obligations (whether known or unknown, absolute
or contingent, accrued or unaccrued, asserted or unasserted, due or to become
due, dispatched or undispatched, joint or several, vested or unvested,
executory, determined, determinable or otherwise, and whether or not such
liabilities and obligations are required to be accrued on the Financial
Statements) of any nature other than liabilities or obligations that were
accrued or reserved against on the Financial Statements or that are current
liabilities incurred in the ordinary course of business consistent with past
practices since the date of the Balance Sheet and which are not, individually or
in the aggregate, material in amount.

 

Section 4.16     Environmental Matters.

 

(a)     Except as set forth in Section 4.16(a) of the Company Disclosure Letter,
the Company, the Subsidiaries and the Real Property are, and have been, in
compliance in all material respects with all Environmental Laws;

 

(b)     the Company and each Subsidiary is, and has been, in compliance with all
Permits required under Environmental Laws for the ownership, lease and operation
of its properties (including all Real Property) and operation of its respective
businesses, and all such Permits are valid and in good standing and are listed
in Section 4.16(b) of the Company Disclosure Letter;

 

(c)     there are no pending, or, to the Knowledge of the Company, threatened
Environmental Claims against the Company or any Subsidiary or related to any
Real Property;

 

(d)     the Company has not received notice that the Company or any of its
Subsidiaries or any Real Property is not in compliance with any Environmental
Law or is subject to potential liability under any Environmental Law, including
potential liability for the costs of investigating or remediating Hazardous
Substances pursuant to the Comprehensive Environmental Response, Compensation
and Liability Act (“CERCLA”), or analogous state Law;

 

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(e)     except as set forth in Section 4.16(e) of the Company Disclosure Letter,
there have been no Releases or threatened Releases of Hazardous Substances on,
at, under or about any properties (including the Real Property) currently or
formerly owned, leased or operated by the Company or any Subsidiary, or any of
their predecessors, that would reasonably be expected to subject them to an
Environmental Claim or otherwise create liability under Environmental Law;

 

(f)     the Company has provided to Parent true and complete copies of all
environmental site assessments, compliance audits, environmental insurance
policies, expenditures for environmental health and safety compliance,
corrective action plans, regulatory correspondence and similar documentation
concerning any and all past or present operating facilities, real property
(including the Real Property) and personal property owned or operated by the
Company or any Subsidiary and for property at which waste or materials from the
Company or any Subsidiary actually or allegedly have been sent;

 

(g)     Section 4.16(g) of the Company Disclosure Letter contains a complete and
accurate list of all off-site Hazardous Substances treatment, storage, or
disposal facilities or locations used by the Company or a Subsidiary or any
predecessor thereto as to which the Company or a Subsidiary may retain
liability. All offsite shipments, transportation, handling and disposal of
materials and wastes, including Hazardous Substances, from any properties
(including the Real Property) currently or formerly owned, leased or operated by
the Company or any Subsidiary, or any of its predecessors have been in material
compliance with Environmental Laws and no off-site facilities or locations where
such offsite shipments have been sent have been placed or proposed for placement
on the National Priorities List (or CERCLIS) under CERCLA, or any similar state
list, and neither the Company nor any Subsidiary has received any notice of an
Environmental Claim with respect to such off-site facilities or locations;

 

(h)     neither the Company nor any Subsidiary has retained or assumed, by
contract or operation of Law, any liabilities or obligations of third parties
under Environmental Law; and

 

(i)     the Company has disclosed to Parent all material facts concerning the
environmental, health or safety compliance status of the Company and each
Subsidiary.

 

Section 4.17     Intellectual Property.

 

(a)     Section 4.17(a)(i) of the Company Disclosure Letter contains a complete
and accurate list of all (i) patented or registered Intellectual Property owned,
purported to be owned, or licensed exclusively by the Company or any Subsidiary
(“Registered IP”) specifying as to each, as applicable: the title, mark, or
design; the record owner and inventor(s), if any; the jurisdiction by or in
which it has been issued, registered, or filed; the patent, registration, or
application serial number; the issue, registration, or filing date; and the
current status; (ii) pending patent applications and applications for
registrations of other Intellectual Property filed by, or on behalf of, the
Company or any Subsidiary (“Pending IP”) specifying as to each, as applicable:
the title, mark, or design; the record owner and inventor(s), if any; the
jurisdiction by or in which it has been filed; the filing date; the application
number; and the current status; and (iii) material unregistered trade names,
trademarks, service marks, internet domain names, company names, and computer
software product names (“Unregistered IP”). Section 4.17(a)(ii) of the Company
Disclosure Letter contains a complete and accurate list of (A) all licenses and
other rights granted by the Company or any Subsidiary to any third party with
respect to any Intellectual Property, but excluding any licenses or other rights
granted by the Company or any Subsidiary in connection with its sale of a
product if such license or other right will convey with any resale of such
product, and (B) all licenses and other Contract rights granted by any third
party to the Company or any Subsidiary with respect to any Intellectual Property
(collectively, “License Agreements”); provided, however, that Section
4.17(a)(ii) shall not include any end user non-exclusive license of generally
commercially available software used in the Company’s or any Subsidiary’s
operations that is licensed for an aggregate license fee of no more than
$25,000. With respect to each item of Registered IP, Pending IP, Unregistered IP
and proprietary software of the Company or any Subsidiary: (x) the item is not
subject to any outstanding injunction, judgment, order, decree, ruling or
charge; (y) except as set forth in Section 4.17(a)(ii)(y) of the Company
Disclosure Letter, no action, suit, proceeding, hearing, charge, complaint,
claim or demand is pending or, to the Knowledge of the Company, threatened which
challenges the legality, validity, enforceability, use or ownership of the item
and (z) Company has provided Parent with true and complete copies of file
histories, documents, certificates, office actions, correspondence and other
materials related to all Registered IP and Pending IP.

 

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(b)     Except as set forth in Section 4.17(b) of the Company Disclosure Letter,
the Company and each Subsidiary owns, free of all Liens (except Permitted
Liens), all right, title and interest to all Registered IP and Pending IP, and
owns, free of all Liens (except Permitted Liens), all right, title and interest
to or has the right to use pursuant to a written license, all other Intellectual
Property used in, or necessary for, the operation of its business as currently
conducted. The Closing will not result in the loss or impairment of or payment
of any additional amounts with respect to, nor except as set forth in Section
4.17(b) of the Company Disclosure Letter, require the consent of any other
Person in respect of the right to own, use or hold for use, any Registered IP,
Pending IP and other Intellectual Property used in, or necessary for, the
operation of the Company’s business as currently conducted.

 

(c)     The Company has taken commercially reasonable steps to maintain and
protect the Intellectual Property owned, licensed or used by the Company or any
Subsidiary (other than the disclosure of trade secrets or abandonment of Pending
IP made in the Company’s reasonable business judgment or in the ordinary course
of business). All required filings and fees related to the Pending IP and
Registered IP have been timely filed with and paid to the relevant Governmental
Authorities and authorized registrars, and all Pending IP and Registered IP are
otherwise in good standing (other than the abandonment of Pending IP made in the
Company’s reasonable business judgment). To the Knowledge of the Company, all of
the Intellectual Property of the Company and the Subsidiaries is valid,
subsisting and enforceable, and all Registered IP is subsisting and in full
force and effect.

 

(d)     To the Knowledge of the Company, all statements contained in all
applications prepared by the Company or a Subsidiary for the registration of its
Intellectual Property were, are and will be, as the case may be, true, correct
and complete in all material respects.

 

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(e)     Neither the Company nor any Subsidiary has infringed upon or
misappropriated any intellectual property rights of any other Person with
respect to the Intellectual Property owned, licensed or used by the Company or
any Subsidiary. The operations of the Company and each Subsidiary as currently
conducted and the products or services currently marketed or sold by the Company
or any Subsidiary have not violated and do not violate any license and have not
misappropriated, infringed, or violated and do not misappropriate, infringe or
violate, any intellectual property, personal property or privacy rights of any
other Person. The Company has not received any written communications alleging
that the Company or any Subsidiary has, with respect to the Intellectual
Property owned, licensed or used by the Company or any Subsidiary, infringed,
misappropriated or violated any of the patents, trademarks, service marks,
tradenames, copyrights, trade secrets, mask works, processes or other
intellectual property or personal property rights of any other Person. To the
Knowledge of the Company, except as set forth in Section 4.17(e) of the Company
Disclosure Letter, no other Person has interfered with, infringed upon,
misappropriated or otherwise come into conflict with rights of the Company or
any Subsidiary in and to the Intellectual Property owned, licensed by or used by
the Company or any Subsidiary. There are no pending claims, including, but not
limited to, litigation, arbitration, opposition proceedings, petitions to
cancel, interferences, administrative proceedings, demand letters, cease and
desist letters, or other demands, challenges, or disputes of any nature
challenging, impacting, or involving the Intellectual Property owned, licensed
or used by the Company or any Subsidiary, the Company’s or any Subsidiary’s
rights therein, or the personal property rights of any other Person. Except as
expressly set forth in Section 4.17(e), no provision of this Agreement is, or
will be construed to be, a representation or warranty by the Company with
respect to the infringement, misappropriation or other violation of the
Intellectual Property of any Person.

 

(f)     Since December 1, 2014, and to the Knowledge of the Company at no time
prior to December 1, 2014, no Intellectual Property owned by the Company or any
Subsidiary was developed using (in whole or in part) funding or facilities
provided by any Governmental Authority or university, college, other educational
institution, international organization, non-profit organization or research
center, nor was it obtained from any Governmental Authority or university,
college or other educational institution, international organization, non-profit
organization or research center. To the Knowledge of the Company, no
Governmental Authority or university, college or other educational institution,
international organization, non-profit organization or research center has a
claim or right to claim any right in the Intellectual Property owned, licensed
or used by the Company or any Subsidiary.

 

(g)     To the Knowledge of the Company, each of the officers, directors and
employees of the Company and each Subsidiary and their consultants and
independent contractors have disclosed to the Company or a Subsidiary in writing
all inventions, ideas, improvements, computer programs, trade secrets, know how,
confidential manufacturing methods and the like relating to the business of the
Company and conceived or developed by such Persons (“Inventions”). Except as set
forth in Section 4.17(g) of the Company Disclosure Letter, each of the current
and former officers, directors and employees of the Company or any Subsidiary
and their consultants, and independent contractors involved in the development
of the Company Intellectual Property, are, to the extent permitted under
applicable Laws, contractually obligated to disclose and assign all rights in
the Inventions to the Company or a Subsidiary and cooperate with the Company or
a Subsidiary in obtaining and perfecting ownership of patents, copyrights, and
other statutory or other rights for the Inventions, and all such assignments
have been executed for purposes of vesting in the Company or a Subsidiary full
right, title and interest in any and all Inventions, to the maximum extent
permitted under applicable Laws.

 

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(h)     In connection with the continued use, after Closing, of Intellectual
Property as currently used by the Company or any Subsidiary, it will not be
necessary to use any inventions of any employees or consultants of the Company
or any Subsidiary (or Persons the Company or any Subsidiary currently intends to
hire) made prior to their employment by the Company or any Subsidiary and which
Company does not have the right to use in connection with its business.

 

(i)     The Company and each Subsidiary has used commercially reasonable efforts
to maintain, in confidence, all Intellectual Property owned, licensed or used by
the Company or any Subsidiary which consists of trade secrets or confidential
information, including requiring all Persons having access thereto to execute
written non-disclosure agreements (other than the disclosure of trade secretes
made in the Company’s reasonable business judgment), and, to the Company’s
Knowledge, there has not been any breach by any of the foregoing of any such
agreement.

 

(j)     All computer software owned by the Company or any Subsidiary and, to the
Knowledge of the Company, all computer software incorporated into any software
owned by the Company or any Subsidiary, all computer software marketed or
licensed to third parties by the Company or any Subsidiary, and all computer
software used internally by Company to operate its business: (i) performs in
material conformance with its documentation, (ii) is free from any material
software defect and (iii) does not contain any virus, or other software routine
or hardware component (A) designed to permit unauthorized access or to disable
or otherwise harm any computer, systems or software or (B) that would reasonably
be expected to materially impair the operation or functionality of such
software. The Company or a Subsidiary has possession of, or access to, the
source code for each material version of software licensed to third parties by
the Company or a Subsidiary, as well as all documentation related thereto.
Additionally, the Company or any Subsidiary has the right to modify the source
code for each material version of software licensed to third parties by the
Company or a Subsidiary and has the right to license use of such software to its
customers and end users.

 

(k)     No Open Source Materials have been incorporated into or otherwise
utilized in the creation of any source code for any computer software owned or
used exclusively by the Company or any Subsidiary or that is, is part of, or is
used to develop, maintain or provide any Company product or service (together
with all documentation, including user manuals and other training documentation,
“Company Source Code”) or other software owned by the Company or any Subsidiary
that results in such Company Source Code being covered by the General Public
License or a similar open source licensing regime that would require such
Company Source Code to be generally made available. Section 4.17(k) of the
Company Disclosure Letter contains a complete and accurate list of all Open
Source Materials that have been incorporated into or otherwise utilized in the
creation of Company Source Code or other software owned by the Company.

 

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(l)     The Company Source Code has been maintained in strict confidence and has
been disclosed only to those employees and other Persons who have a “need to
know” the contents thereof in connection with the performance of their duties to
the Company or any Subsidiary and who have executed valid and enforceable
nondisclosure and non-use agreements with the Company or any Subsidiary, as
applicable. Except as set forth in Section 4.17(l) of the Company Disclosure
Letter, the Company Source Code is not the subject of any escrow or similar
agreement giving any Person rights in or to such Company Source Code upon the
occurrence of certain events.

 

(m)     To the Knowledge of the Company, in the twelve (12) month period prior
to the date hereof, there were no material performance reductions or breakdowns
of, or logical or physical intrusions in, any Company or Subsidiary computer or
information technology resources or any material loss of data.

 

(n)     The Company and the Subsidiaries have commercially reasonable
information security safeguards, protections and procedures in place with
respect to their information technology systems and the data therein. To the
Knowledge of the Company, service providers of the Company and the Subsidiaries
have information security safeguards, protections and procedures in place with
respect to their information technology systems used on behalf of the Company
and any Subsidiary and the data therein in accordance with applicable law and
generally accepted industry standards. In the three (3) year period prior to the
date hereof, (A) neither the Company nor any Subsidiary has experienced any
incident in which financial information or personally identifiable information
of individuals collected, processed or stored by or on behalf of the Company or
any Subsidiary was accessed by or disclosed to unauthorized persons in violation
of applicable Law, or stolen (whether such information is or was in the
possession of the Company or any Subsidiary or any third party service provider
storing such information on behalf of the Company or any Subsidiary), (B) no
breach of security of the Company and the Subsidiaries regarding any such
information has occurred, and (C) neither the Company nor any Subsidiary has
received any written notices or complaints from any Person regarding improper
disclosure relating to such information.

 

(o)     The Company and the Subsidiaries currently have information technology
systems reasonably sufficient to operate their business as presently conducted,
and the Company and the Subsidiaries have disaster recovery plans, procedures
and facilities in place that are consistent with generally accepted industry
standards that will remain in effect immediately after the Closing. The Company
tests such plans and procedures on a regular basis, and such plans and
procedures have been proven effective upon such testing.

 

Section 4.18     Insurance. Section 4.18 of the Company Disclosure Letter set
forth a true and complete list of each insurance policy (including policies
providing property, casualty, liability, workers’ compensation and comprehensive
general liability coverage and bond and surety arrangements) that is in force as
of the date hereof and as to which the Company or any Subsidiary is a party, a
named insured or otherwise the beneficiary of coverage, and the Company has
delivered a certificate of insurance issued by the insurance provider to Parent
for each such insurance policy. The Company and each Subsidiary is currently a
party to, or the named insured or beneficiary of coverage under, comprehensive
general liability insurance policies that are occurrence-based (rather than
claims-made) policies and that will be in full force and effect through the
Effective Time. With respect to each such insurance policy: (i) the policy is
legal, valid, binding, enforceable and in full force and effect; (ii) none of
the Company, any Subsidiary or any other party to the policy, is in breach or
default thereunder (including with respect to the payment of premiums or the
giving of notices), and no event has occurred that, with notice or the lapse of
time, would constitute such a breach or default, or permit termination,
modification or acceleration under the policy; and (iii) no party to any policy
has repudiated any provision thereof. The Company and each Subsidiary has been
covered since December 31, 2014 by insurance substantially similar in scope to
that listed in Section 4.18 of the Company Disclosure Letter. Set forth in
Section 4.18 of the Company Disclosure Letter are all claims made under any
insurance policy during the past three years with respect to the Company.

 

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Section 4.19     Company Contracts.

 

(a)     Section 4.19(a) of the Company Disclosure Letter contains a correct and
complete list of all the following Contracts (and all amendments, modifications
and supplements thereto) to which the Company or any Subsidiary is a party or by
which any of the properties or assets of the Company or any Subsidiary are bound
and which is currently in effect: (i) employment, product design or development,
personal services, consulting, non-competition, severance, golden parachute, or
indemnification Contracts, other than offer letters providing for employment on
an at-will basis; (ii) sales, sales representative, commercial agency,
distribution or franchise Contracts; (iii) Contracts granting rights of first
refusal or first negotiation; (iv) partnership, joint venture or similar
Contracts; (v) Contracts for the acquisition, sale or lease of material
properties or assets or stock (other than sales of inventory in the ordinary
course of business); (vi) Contracts with any Governmental Authority;
(vii) Contracts relating to the purchase of materials, supplies, goods,
merchandise, equipment or services used in support of the business or operations
of the Company (excluding purchase orders entered into from time to time in the
ordinary course of business); (viii) Contracts relating to the marketing, sale,
advertising or promotion of the Company’s or any Subsidiary’s products (other
than trade promotion offers between the Company or any Subsidiary and its
customers entered into in the ordinary course of business); (ix) non-competition
or similar agreements which restrict or may hereafter restrict the geographic or
operational scope of the business of the Company or any of its Affiliates or the
ability of the Company or any of its Affiliates to enter into new lines of
business; (x) grants of funding from governmental or quasi governmental
entities; (xi) License Agreements; (xii) Contracts that involve any Company
Stockholder or any Affiliate of a Company Stockholder or any officer or director
of the Company or any Subsidiary, other than offer letters providing for
employment on an at-will basis; (xiii) Contracts that require the payment, or
involve the receipt, of more than $250,000 in any 12-month period; (xiv)
Contracts providing for warranties on any Improvements located at the Real
Property; (xv) Contracts that provide for the indemnification by the Company or
a Subsidiary of any Person or the assumption of any Tax, environmental or other
liability of any Person; (xvi) except for Contracts relating to trade
receivables, all Contracts relating to Company Indebtedness (including, without
limitation, guarantees); (xvii) collective bargaining and labor union Contracts;
(xviii) Contracts that require the Company or any Subsidiary to purchase its
total requirements of any product or service from a third party or that contain
“take or pay” provisions; and (xix) Contracts to enter into any of the foregoing
(collectively, and together with the Real Property Leases, the “Company
Contracts).

 

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(b)     The Company is not a party to or bound by any consulting, severance,
golden parachute, indemnification or other agreement with any employee or
consultant pursuant to which such person would be entitled to receive any
additional compensation or an accelerated payment of compensation as a result of
the consummation of the transactions contemplated hereby (either alone or in
combination with another event) and neither the Company nor any Subsidiary is
obligated to make a payment that would be a “parachute payment” to a
“disqualified individual” (as those terms are defined in Section 280G of the
Code, without regard to whether such payment is reasonable compensation for
personal services performed or to be performed in the future).

 

(c)     Each of the Company Contracts is valid, binding, in full force and
effect and enforceable against the Company or Subsidiary that is a party thereto
and against each other party thereto in accordance with its terms and will
continue to be legal, valid, binding, enforceable and in full force and effect
on identical terms from and after the Effective Time, except to the extent that
its enforceability may be limited by applicable bankruptcy, insolvency,
reorganization or other Laws affecting the enforcement of creditors’ rights
generally or by equitable principles.

 

(d)     None of the Company, any Subsidiary or, to the Knowledge of the Company,
any other party to a Company Contract is in breach or default under any such
Company Contract. The Company and each Subsidiary has performed each material
term, covenant and condition of each Company Contract that is to be performed by
it at or before the date hereof. No event has occurred or circumstances exist
that could, with the passage of time or compliance with any applicable notice
requirements or both, constitute a default of, result in a violation or breach
of, or give any right to accelerate, modify, cancel or terminate any Company
Contract by the Company, any Subsidiary or, to the Knowledge of the Company, any
other party under any such Company Contract. To the Knowledge of the Company, no
party to any Company Contract intends to exercise any right of cancellation,
termination, acceleration or modification under any such Company Contract.
Neither the Company nor any Subsidiary has made any prior assignment of any
Company Contract or any of its rights or obligations thereunder.

 

(e)     Except as disclosed on Section 4.19(e) of the Company Disclosure Letter,
the consummation of the Merger will not give any Party to any of the Company
Contracts rights arising from a change of control, and Merger Subsidiary and/or
Parent (or their legal successor) will continue to essentially enjoy all
material rights and no party has communicated orally or in writing that Merger
Subsidiary and/or Parent or their legal successor will not enjoy ordinary course
benefits of all Company Contracts (save for any contractual arrangements entered
into after the date of this Agreement.

 

Section 4.20     Suppliers and Customers.

 

(a)     Section 4.20(a) of the Company Disclosure Letter lists (i) the top
twenty suppliers to the Company or any Subsidiary in terms of cost to the
Company or such Subsidiary for the year ended December 31, 2016, and (ii) any
supplier of tin, tungsten, tantalum and gold regardless of amount of sales in
the past five years. Neither the Company not any Subsidiary has received any
notice from any such suppliers to the effect that, and the Company does not have
any Knowledge that, such suppliers shall stop, or materially decrease the rate
of or change the price or other sales terms of, selling products or services to
the Company or any Subsidiary (whether as a result of the consummation of the
transactions contemplated hereby or otherwise). Neither the Company nor any
Subsidiary has purchased tin, tungsten, tantalum or gold directly or indirectly
from the Democratic Republic of Congo or from any non-EICC certified smelter of
such materials.

 

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(b)     Section 4.20(b) of the Company Disclosure Letter lists the top twenty
customers of the Company or any Subsidiary in terms of revenue to the Company or
such Subsidiary for the year ended December 31, 2016. Neither the Company not
any Subsidiary has received any notice from any such customers to the effect
that, and the Company does not have any Knowledge that, such customers shall
stop, or materially decrease the rate of, purchasing products or services from
the Company or any Subsidiary (whether as a result of the consummation of the
transactions contemplated hereby or otherwise).

 

Section 4.21     Inventories. All Company Products held in inventory of or for
the Company or any Subsidiary is of merchantable quality and usable and salable
(to the extent held for resale) in the ordinary course of business, except for
obsolete items and items of below-standard quality, all of which have been, or
shall be as of the Closing Date, written off or written down to net realizable
value in accordance with normal trade practices as will be reflected on the
Estimated Closing Net Working Capital Statement and the Closing Net Working
Capital Statement. All items of inventory are fairly reflected in the inventory
accounts on the 2016 Balance Sheet and the Interim Balance Sheet and will be
fairly reflected in the inventory accounts on the Estimated Closing Net Working
Capital Statement and the Closing Net Working Capital Statement and are valued
on the 2016 Balance Sheet and the Interim Balance Sheet and will be valued on
the Estimated Closing Net Working Capital Statement and the Closing Net Working
Capital Statement at the lower of cost or net realizable value. The quantities
of each item of inventory (whether raw materials, work in progress or finished
goods) are not excessive and are reasonable in the present circumstances of the
Company and the Subsidiaries. No inventory is held by the Company or any
Subsidiary on a consignment basis.

 

Section 4.22     Warranties; Product Liability. There are not presently pending,
or, to the Knowledge of the Company, threatened, and, to the Knowledge of the
Company, there is no basis for, any civil, criminal or administrative actions,
suits, demands, claims, hearings, notices of violation, investigations,
proceedings or demand letters relating to any alleged hazard or alleged Defect
in design, manufacture, materials or workmanship, including any failure to warn
or alleged breach of express or implied warranty or representation, relating to
any Product manufactured, distributed or sold by or on behalf of the Company or
any Subsidiary. All Products manufactured, distributed or sold by or on behalf
of the Company or its Affiliates prior to Closing (i) are free from Defects and
(ii) comply with all contractual requirements, covenants or express warranties
applicable thereto and are not subject to any material term, condition,
guaranty, warranty or other indemnity beyond the applicable standard terms and
conditions of sale for such Products. Except as set forth in Section 4.22 of the
Company Disclosure Letter, neither the Company nor any Subsidiary has extended
to any of its customers any written, non-uniform product warranties,
indemnifications or guarantees. A copy of each standard warranty of the Company
is set forth in Section 4.22 of the Company Disclosure Letter. In the last seven
years, no Product has been subject to, or is subject to, any recall mandated by
any Governmental Authority or, as of the date hereof, is being demanded or
requested in writing by any customer. To the Knowledge of the Company, the
Products comply in all material respects with all applicable Laws.

 

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Section 4.23     Bank Accounts. Section 4.23 of the Company Disclosure Letter
sets forth the details of all bank accounts, safety deposit boxes and lock boxes
(designating each authorized signatory with respect thereto) of the Company and
each Subsidiary.

 

Section 4.24     Accounts Receivable. The accounts receivable reflected on the
2016 Balance Sheet and Interim Balance Sheet have arisen from bona fide
transactions in the ordinary course of business and are valid claims collectible
in the ordinary course of business net of the respective reserves reflected on
the 2016 Balance Sheet and the Interim Balance Sheet. There is no contest,
claim, credit or right of set-off, other than returns in the ordinary course of
business, which may be applied against any account receivable or relating to the
amount or validity of such account receivable.

 

Section 4.25     Books and Records. The Books and Records, all of which have
been made available to Parent, are complete and correct and represent actual,
bona fide transactions and have been maintained in accordance with sound
business practices. The minute books of the Company and each Subsidiary, all of
which have been made available to Parent, contain accurate and complete records
of all meetings held of, and corporate action taken by, the Company Stockholders
and the equity holders of each Subsidiary, and no meeting of any such Company
Stockholders or the equity holders of a Subsidiary has been held for which
minutes have not been prepared or are not contained in such minute books. The
Books and Records are located at the Company’s offices in San Diego.

 

Section 4.26     Company Indebtedness. Section 4.26 of the Company Disclosure
Letter sets forth, with respect to the Company and each Subsidiary, a
description of all Company Indebtedness.

 

Section 4.27     Fees and Expenses of Brokers and Others. Except for the fees
and expenses of DBO Partners, which will be included in Company Transaction
Expenses, neither the Company nor any Subsidiary or Company Stockholder is
directly or indirectly committed to any liability for any broker’s or finder’s
fees or fairness opinion fee or any similar fees in connection with the
transactions contemplated by this Agreement and has not retained any broker or
other intermediary to act directly or indirectly on its behalf in connection
with the transactions contemplated by this Agreement.

 

Section 4.28     Board Recommendation. The Company Board, by written consent
dated December 28, 2017, unanimously (a) determined and resolved that this
Agreement and the transactions contemplated hereby, including the Merger, are
advisable, fair to and in the best interests of the Company and the Company
Stockholders, (b) approved, adopted and declared advisable the “agreement of
merger” (as such term is used in Section 251 of the DGCL) contained in this
Agreement and the transactions contemplated hereby, including the Merger, (c)
directed that the “agreement of merger” contained in this Agreement be submitted
to the Company Stockholders for adoption and approval, and (d) recommended that
the Company Stockholders approve and adopt the “agreement of merger” contained
in this Agreement and the transactions contemplated hereby, including the
Merger, by written consent of the Company Stockholders and directed that such
matter be submitted to the Company Stockholders. The resolutions adopted and
approved by the Board of Directors at such meeting have not been rescinded or
modified.

 

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Section 4.29     Required Vote. The affirmative vote of the holders of at least
a majority of the issued and outstanding shares of the Company Common Stock
(voting together as a class with the Company Preferred Stock existing on an
as-converted basis) in favor of adoption of this Agreement and the transactions
contemplated hereby, including the Merger and the holders of at least 60% of the
shares of Company Preferred Stock (voting together as a single class and not as
separate series and on an as-converted basis) (collectively, the “Company
Stockholder Approval”) is necessary to approve and adopt this Agreement and the
transactions contemplated hereby, including the Merger. The Company Stockholder
Approval shall be obtained by the Company upon receipt by the Company of the
Stockholder Consent as contemplated by Section 7.6(a). No vote of the Company
Stockholders other than the Company Stockholder Approval is required by the DGCL
or other applicable Law, the Company Charter, the Company Bylaws or otherwise to
approve and adopt this Agreement and the transactions contemplated hereby,
including the Merger.

 

Section 4.30     Stockholder Notice. None of the information included or
incorporated by reference in the Stockholder Notice in connection with the
Merger, will, at the date it is first mailed to the Company Stockholders or at
the time of any amendment or supplement thereof, contain any untrue statement of
a material fact or omit to state any material fact necessary in order to make
the statements made therein, in the light of the circumstances under which they
were made, not misleading.

 

Section 4.31     Full Disclosure. Neither this Agreement nor the Company
Disclosure Letter contains any untrue statement of a material fact or omits to
state a material fact necessary in order to make the statements contained herein
or therein, in light of the circumstances under which they were made, not
misleading.

 

Article V

REPRESENTATIONS AND WARRANTIES OF PARENT AND MERGER SUBSIDIARY

 

Parent and Merger Subsidiary represent and warrant to the Company, jointly and
severally, as of the date hereof and as of Closing as follows:

 

Section 5.1     Organization and Authority of Parent and Merger Subsidiary.
Parent is a corporation duly organized, validly existing and in good standing
under the Laws of the State of Delaware and has the requisite corporate power
and authority to own or lease all of its properties and assets and to carry on
its business as it is now being conducted. Merger Subsidiary is a corporation
duly organized, validly existing and in good standing under the Laws of the
State of Delaware. Parent owns all of the issued and outstanding shares of
capital stock of Merger Subsidiary. Merger Subsidiary has not engaged in any
activities and does not hold any assets except (in each case) as necessary to be
a party to this Agreement and to consummate the Merger.

 

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Section 5.2     Authority Relative to this Agreement. The execution, delivery
and performance of this Agreement and of all of the other documents and
instruments required hereby by Parent and Merger Subsidiary are within the
corporate power and authority of Parent and Merger Subsidiary. The execution and
delivery of this Agreement, and each Ancillary Document to which Parent or
Merger Subsidiary is a party and the consummation of the transactions
contemplated hereby and thereby have been duly and validly authorized by the
board of directors of Merger Subsidiary and no other corporate proceedings on
the part of Parent or Merger Subsidiary are necessary to authorize the
execution, delivery and performance of this Agreement and each Ancillary
Document to which Parent or Merger Subsidiary is a party or to consummate the
transactions contemplated hereby or thereby. This Agreement and the Ancillary
Documents to which Parent or Merger Subsidiary is a party have been or will be
duly and validly executed and delivered by Parent and Merger Subsidiary, as
applicable, and (assuming the due authorization by the Company and the execution
and delivery by the Company) constitute or will constitute valid and binding
agreements of Parent and Merger Subsidiary, enforceable against Parent and
Merger Subsidiary in accordance with their respective terms, except to the
extent that their enforceability may be limited by applicable bankruptcy,
insolvency, reorganization or other Laws affecting the enforcement of creditors’
rights generally or by equitable principles.

 

Section 5.3     Consents and Approvals; No Violations. Except for the filing and
recordation of the Certificate of Merger with the Secretary of State of the
State of Delaware as required by the DGCL and as required by the HSR Act, no
filing or registration with, or notice to, and no Permit, authorization, waiting
period expiration or termination, consent or approval of, any Governmental
Authority or any other Person is necessary or required in connection with the
execution and delivery by Parent or Merger Subsidiary of this Agreement and each
Ancillary Document to which Parent or Merger Subsidiary is a party or for the
consummation by Parent and Merger Subsidiary of the transactions contemplated by
this Agreement. Assuming that all filings, Permits, authorizations, waiting
period expirations or terminations, consents and approvals contemplated by the
immediately preceding sentence have been duly made or obtained, neither the
execution or delivery by Parent and Merger Subsidiary of this Agreement and each
Ancillary Document to which Parent or Merger Subsidiary is a party nor the
performance of this Agreement and each such Ancillary Document nor the
consummation of the transactions contemplated hereby or thereby by Parent and
Merger Subsidiary will (a) conflict with or result in any breach of any
provision of the respective certificate of incorporation, bylaws or other
organizational documents of Parent or Merger Subsidiary, (b) result in a
material violation or breach of, or constitute (with or without due notice or
lapse of time or both) a material default (or give rise to any right of
termination, amendment, cancellation or acceleration) under, any of the terms,
conditions or provisions of any note, bond, mortgage, indenture, license,
Contract or other instrument or obligation to which either of Parent or Merger
Subsidiary is a party or by which either Parent or Merger Subsidiary or any of
the properties or assets of either of Parent or Merger Subsidiary may be bound
or (c) violate any order, writ, injunction, decree, statute, rule or regulation
applicable to either Parent or Merger Subsidiary or any of the properties or
assets of Parent or Merger Subsidiary.

 

Section 5.4     Litigation. There is no action, suit, proceeding or
investigation pending or, to the knowledge of Parent, threatened against or
relating to Parent or Merger Subsidiary at law or in equity, or before any
Governmental Authority, that seeks restraint, prohibition, damages or other
relief in connection with this Agreement or the consummation of the transactions
contemplated hereby.

 

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Section 5.5     Fees and Expenses of Brokers and Others. Neither Parent nor
Merger Subsidiary is directly or indirectly committed to any liability for any
broker’s or finder’s fees or any similar fees in connection with the
transactions contemplated by this Agreement or has retained any broker or other
similar intermediary to act directly or indirectly on its behalf in connection
with the transactions contemplated by this Agreement.

 

Section 5.6     Financing. Parent has available on hand or will have available
at Closing sufficient cash and cash equivalents to pay the Purchase Price
pursuant to Article III of this Agreement.

 

Section 5.7     Acknowledgement. Parent and Merger Subsidiary are each
sophisticated parties, experienced in and fully capable of negotiating and
investigating transactions of the sort contemplated herein, and have each
conducted their own independent investigation, review and analysis of the
business, operations, assets, liabilities, results of operations, financial
condition, software, technology and prospects of the business of the Company and
its Subsidiaries. Parent and Merger Subsidiary hereby acknowledge and agree that
none of the Company, its Affiliates or any of their respective directors,
officers, employees, agents, advisors or other representatives make or have made
any representation or warranty, express or implied, at law or in equity, that
are not expressly set forth in Article IV of this Agreement (as qualified by the
Company Disclosure Letter). Nothing in this Agreement shall waive any right of
Parent or Merger Subsidiary to bring any action based on fraud.

 

Article VI

COVENANTS RELATING TO CONDUCT OF BUSINESS

 

Section 6.1     Operation in the Ordinary Course. During the period from the
date of this Agreement to the earlier of the Effective Time or the termination
of this Agreement in accordance with its terms, unless Parent shall otherwise
consent in writing (which consent shall not be unreasonably withheld,
conditioned, or delayed) and except as otherwise expressly contemplated or
permitted by this Agreement or required by applicable Laws, the Company shall,
and shall cause each Subsidiary to, operate its business solely in the ordinary
course, consistent with past practice and use its commercially reasonable
efforts to preserve intact its assets (including its goodwill) and current
business organizations, keep available the services of its current officers and
employees, maintain the Company Contracts and preserve its relationships with
customers, suppliers, creditors, brokers, agents and others with whom it has
material business dealings. Without limiting the foregoing, from the date hereof
until the earlier of the Closing Date or the termination of this Agreement in
accordance with its terms, the Company shall, and shall cause each Subsidiary to
use commercially reasonable efforts to:

 

(a)     preserve and maintain all of its Permits;

 

(b)     pay its debts, Taxes and other obligations when due;

 

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(c)     maintain the properties and assets owned, operated or used by it in the
same condition as they were on the date of this Agreement, subject to reasonable
wear and tear;

 

(d)     continue in full force and effect without modification all insurance
policies, except as required by applicable Law;

 

(e)     defend and protect its properties and assets from infringement or
usurpation consistent with the Company’s past practice;

 

(f)     perform all of its obligations under all Contracts relating to or
affecting its properties, assets or business;

 

(g)     maintain its Books and Records in accordance with past practice; and

 

(h)     comply in all material respects with all applicable Laws.

 

Section 6.2     Affirmative and Negative Covenants. Without limiting the
generality of Section 6.1, and except as otherwise expressly contemplated by
this Agreement, as required by applicable Laws, or as agreed to in writing by
Parent (which agreement shall not be unreasonably withheld, conditioned, or
delayed), during the period from the date of this Agreement to the earlier of
the Effective Time or the termination of this Agreement in accordance with its
terms, the Company shall not, and shall cause each Subsidiary not to:

 

(a)     issue, sell or grant to any Person any shares of capital stock of any
class, or any securities or rights convertible into, exchangeable for, or
evidencing the right to subscribe for any shares of capital stock (other than
pursuant to the exercise of Options outstanding as of the date of this
Agreement), or any rights, warrants, options, calls, commitments or any other
agreements of any character to purchase or acquire any shares of capital stock
or any securities or rights convertible into, exchangeable for, or evidencing
the right to subscribe for, any shares of capital stock or any other securities
in respect of, in lieu of, or in substitution for, shares outstanding on the
date hereof;

 

(b)     (i) split, combine, subdivide or reclassify any shares of its capital
stock or (ii) declare, set aside for payment or pay any dividend, or make any
other distribution in respect of, any of its capital stock, or redeem or
repurchase any of its capital stock or any outstanding options, warrants or
rights of any kind to acquire any shares of, or any outstanding securities that
are convertible into or exchangeable for any shares of, its capital stock;

 

(c)     adopt any amendments to the Company Charter or the Company Bylaws or
effect or become a party to any recapitalization or similar transaction;

 

(d)     other than (i) borrowings by the Company or any Subsidiary in the
ordinary course and (ii) borrowings by the Company or any Subsidiary up to a
maximum of $2 million for purposes of investment in land, buildings or other
capital in Vietnam after September 29, 2017, incur any additional indebtedness
for money borrowed or guarantee any such indebtedness of another Person;

 

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(e)     acquire or agree to acquire by merging or consolidating with, or by
purchasing a substantial portion of the assets of, or by any other manner,
(i) any business or any corporation, limited liability company, partnership,
joint venture, association or other business organization or division thereof or
(ii) any assets that, individually or in the aggregate, are material to the
Company;

 

(f)     except in the ordinary course of business and as provided by this
Agreement, sell, lease, license or otherwise encumber or subject to any Lien or
otherwise dispose of any of its material properties or assets;

 

(g)     make or agree to make any material capital expenditures that, when added
to all other capital expenditures made on behalf of the Company since the date
hereof, exceed $100,000 in the aggregate;

 

(h)     except in the ordinary course of business, (i) enter into any Contract
relating to the purchase of goods, equipment or services of amounts in excess of
$250,000 per year or having a duration in excess of one year (excluding purchase
orders entered into from time to time in the ordinary course of business), (ii)
enter into any Contract with any officer or director or employee of Company or
its Subsidiaries, or (iii) modify, amend or transfer in any respect or terminate
any Company Contract or waive, release or assign any rights or claims
thereunder;

 

(i)     (i) except as may be required by Law, adopt or amend any bonus, profit
sharing, compensation, stock option, pension, retirement, deferred compensation,
employment or other employee benefit plan, agreement, trust, fund or other
arrangement (including any Employee Benefit Plan) for the benefit or welfare of
any current or former employee, officer, director, independent contractor,
leased employee or other service provider or their spouses, dependents or
beneficiaries, or (ii) increase the compensation of any such individuals or pay
any benefit not required by any existing plan, arrangement or agreement
(including any Employee Benefit Plan);

 

(j)     except as may be required by GAAP or applicable Law, make any change to
its accounting methods, principles or practices;

 

(k)     make, change or revoke any Tax election, change an annual Tax accounting
period, adopt or change any Tax accounting method, file any amended Tax Return,
enter into any closing agreement with respect to Taxes, or settle any Tax claim,
audit, assessment or dispute or surrender any right to claim a refund of Taxes;

 

(l)     (i) pay, discharge, settle or satisfy any claims, liabilities or
obligations in excess of $100,000 in the aggregate, other than the payment,
discharge or satisfaction in the ordinary course of business or as required by
their terms as in effect on the date hereof, of claims, liabilities or
obligations reflected or reserved against in the most recent audited financial
statements or incurred since the date of such financial statements in the
ordinary course of business, (ii) waive, release, grant or transfer any right of
material value other than in the ordinary course of business or (iii) commence
any legal proceedings other than in the ordinary course of business; or

 

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(m)     authorize any of, or commit, resolve or agree to take any of, the
foregoing actions.

 

Section 6.3     No Control of the Company’s Business. Parent acknowledges and
agrees that: (i) nothing contained in this Agreement shall give Parent, directly
or indirectly, the right to control or direct the Company’s or the Company’s
Subsidiaries’ operations prior to the Closing, (ii) prior to the Closing, the
Company shall exercise, consistent with the terms and conditions of this
Agreement, complete control and supervision over its and its Subsidiaries’
operations, and (iii) notwithstanding anything to the contrary set forth in this
Agreement, no consent or agreement of Parent shall be required with respect to
any matter set forth in Article VI or elsewhere in this Agreement to the extent
that the requirement of such consent or agreement could as determined by
Parent’s outside antitrust counsel violate any applicable law.

 

Section 6.4     No Negotiation. Until such time as this Agreement shall be
terminated pursuant to Article IX, none of the Company, any Company Stockholder
or any Affiliate thereof or any director, partner, stockholder, member or
officer thereof shall, directly or indirectly, solicit, initiate, facilitate,
encourage or entertain any inquiries or proposals from, discuss or negotiate
with, provide any information to, or consider the merits of any inquiries or
proposals from, any Person (other than Parent and Merger Subsidiary) involving a
merger, consolidation, business combination, purchase or disposition transaction
involving the Company or its business, including any sale of any capital stock
of the Company or any assets of the Company. The Company shall notify Parent of
any such inquiry or proposal within 24 hours of receipt or awareness of the same
by the Company. In consideration for the substantial expenditures of time,
effort and expense undertaken by Parent in connection with the preparation,
negotiation and execution of this Agreement, the Company agrees that money
damages would not be a sufficient remedy for any breach of this Section 6.4 by
the Company, any Company Stockholder or any Affiliate thereof or any director,
stockholder, member or officer thereof and that, in addition to all other
remedies, Parent shall be entitled to seek specific performance and injunctive
or other equitable relief as a remedy for any breach of this Section 6.4.

 

Article VII

ADDITIONAL AGREEMENTS

 

Section 7.1     Access to Information; Confidentiality.

 

(a)     Upon reasonable notice, subject to applicable Competition Laws and
relating to the exchange of information, the Company shall (i) afford to the
officers, employees, accountants, counsel and other representatives of Parent,
reasonable access during normal business hours during the period from the date
hereof to the Effective Time, to all of the properties, books, contracts,
commitments, records, management and employees of the Company and each
Subsidiary, and during such period, the Company shall furnish promptly to Parent
all information concerning its business, properties and personnel as Parent may
reasonably request, (ii) use reasonable best efforts to cause the Company’s
consultants to provide access to their work papers and such other information as
Parent may reasonably request and (iii) furnish promptly to Parent each written
update provided to its Board of Directors on the financial performance and
projections for the Company (except where the Company determines, following
consultation with legal counsel, that doing so would result in the loss of
attorney-client, attorney work product or similar privilege or protection, in
which case the Company (i) shall provide such access and information in such
form, including by way of redacting sensitive information, so as to preserve
such privilege or protection while providing Parent with as much access and
information as reasonably possible) and (ii) shall preserve and not destroy any
such privileged or redacted information, documents or work papers. Parent agrees
that it will not, and it will cause its representatives not to, use any
information obtained pursuant to this Section 7.1 for any purpose unrelated to
the consummation of the transactions contemplated by this Agreement and all such
information shall be subject to the confidentiality obligations set forth in
Section 7.1(b).

 

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(b)     Between the date of this Agreement and the earlier to occur of (i) the
Effective Time and (ii) two years from the date hereof, Parent, Merger
Subsidiary and the Company will maintain in confidence, and will cause their
respective directors, officers, employees, agents, advisors and representatives
to maintain in confidence, any written, oral, or other non-public information
obtained in confidence from any other Party (or from such other Party’s
directors, officers, employees, agents, advisors and representatives) in
connection with this Agreement or the transactions contemplated hereby,
including the Merger, unless (A) such information is already known to others not
bound by a duty of confidentiality or such information becomes publicly
available through no fault of such Party (or such Party’s directors, officers,
employees, agents, advisors and representatives), (B) the use of such
information is necessary or appropriate in making any filing or obtaining any
consent or approval required for the consummation of the Merger, or (C) the
furnishing or use of such information is required by legal proceedings.

 

Section 7.2     Commercially Reasonable Efforts. Upon the terms and subject to
the conditions set forth in this Agreement, each of the Company and Parent
agrees to use its commercially reasonable efforts to take, or cause to be taken,
all actions, and to do, or cause to be done, and to assist and cooperate with
the other Parties in doing, all things necessary, proper or advisable to
consummate and make effective, in the most expeditious manner practicable and in
any event by or before the Walk-Away Date, the Merger, and the other
transactions contemplated by this Agreement, including (a) subject to Section
7.8(f), the obtaining of all necessary actions or nonactions, waivers, waiting
period expirations or terminations, consents and approvals from Government
Authorities and the making of all necessary registrations and filings (including
filings with Government Authorities) and the taking of all steps as may be
necessary to obtain an approval or waiver from, or to avoid an action or
proceeding by, any Governmental Authority, (b) the obtaining of all necessary
consents, approvals or waivers from third parties, (c) the defending of any
lawsuits or other legal proceedings, whether judicial or administrative,
challenging this Agreement or the consummation of the transactions contemplated
hereby, including seeking to have any stay or temporary restraining order
entered by any court or other Governmental Authority vacated or reversed and
(d) the execution and delivery of any additional instruments necessary to
consummate the transactions contemplated by this Agreement.

 

Section 7.3     Public Announcements. Parent and the Company will consult with
each other before issuing any press release or otherwise making any public
statement with respect to the transactions contemplated by this Agreement and
shall not issue any such press release or make any such public statement prior
to giving each Party the opportunity to review and comment on such press release
or public statement. The Parties agree that the initial press release or
releases to be issued in connection with the execution of this Agreement shall
be mutually agreed upon prior to the issuance thereof.

 

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Section 7.4     Notification of Certain Matters. The Company shall give prompt
written notice Parent on an “counsel only” basis of (a) any notice or other
communication received by the Company or any Subsidiary from any Governmental
Authority on or with respect to any subject or topic whatsoever, including the
Merger, or from any Person alleging that the consent of such Person is or may be
required in connection with the transactions contemplated by this Agreement,
including the Merger, (b) any actions, suits, claims, investigations or
proceedings commenced or, to the Knowledge of the Company, threatened against,
relating to or involving or otherwise affecting the Company which relate to the
transactions contemplated by this Agreement, including the Merger, and (c) the
discovery of any fact or circumstance that, or the occurrence or non-occurrence
of any event the occurrence or non-occurrence of which, would cause or result in
any of the conditions to the Merger set forth in Section 8.1 or Section 8.2 not
being satisfied or satisfaction of those conditions being materially delayed in
violation of any provision of this Agreement; provided, however, that the
delivery of any notice pursuant to this Section 7.4 shall not (i) cure any
breach of, or non-compliance with, any other provision of this Agreement or (ii)
limit the remedies available to Parent after receiving any such notice. Parent
shall give prompt written notice to the Company (on an “counsel only” basis) of
any notice or other communication received by Parent from any Governmental
Authority in connection with the transactions contemplated by this Agreement.

 

Section 7.5     Payments of Company Transaction Expenses Prior to Closing. On or
immediately prior to Closing, the Company shall pay in full and satisfy all
Company Transaction Expenses, and none of Parent, Merger Subsidiary or the
Surviving Corporation shall assume any of such Company Transaction Expenses as a
result of the Merger. Any Company Transaction Expenses not paid and satisfied by
the Company prior to Closing will be paid and satisfied at Closing by Parent
pursuant to Section 2.4(b)(vi).

 

Section 7.6     Stockholder Consent; Stockholder Notice.

 

(a)     Promptly following the execution of this Agreement and in lieu of
calling a meeting of the Company Stockholders, the Company shall submit a form
of irrevocable written consent attached hereto as Exhibit D to record holders of
Company Capital Stock sufficient to obtain the Company Stockholder Approval
(such written consent, as duly executed and delivered by all such record
holders, the “Stockholder Consent”), which Stockholder Consent shall be
irrevocable. As soon as practicable upon receipt of the Stockholder Consent, the
Company will provide Parent with a pdf copy of such Stockholder Consent,
certified as true and complete by the corporate secretary of the Company. In
connection with the Stockholder Consent, the Company shall take all actions
necessary to comply, and shall comply in all respects, with the DGCL, including
Section 228 and Section 262 thereof, and the Company Charter and Company Bylaws.

 

(b)     Within ten Business Days after receipt of the Stockholder Consent, the
Company shall mail to each Company Stockholder a notice describing, among other
things, the Merger and the other transactions contemplated hereby and containing
the notices of action by written consent required by Section 228(e) of the DGCL
and of availability of appraisal rights and related disclosure required by
Section 262 of the DGCL (the “Stockholder Notice”). Parent shall reasonably
cooperate with the Company with the preparation of the Stockholder Notice and
shall furnish to the Company all information concerning Parent, requested by the
Company, that is reasonably requested or customary for inclusion in the
Stockholder Notice. The Company shall provide Parent a reasonable opportunity to
review and comment upon the Stockholder Notice prior to the mailing thereof to
the Company Stockholders. The Company shall be responsible for and pay all
expenses incurred in connection with the printing and mailing of the Stockholder
Notice.

 

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Section 7.7     Resignations. The Company shall deliver to Parent written
resignations, effective as of the Closing Date, of the officers and directors of
the Company and the Subsidiaries set forth on Schedule 7.7. The resignations
shall include a letter from Ethertronics Limited, as sole shareholder of the
Subsidiaries organized in China, to remove all the directors and the supervisor
of such Subsidiaries, and shall be accompanied by all corporate chops,
including, without limitation, the company chop, legal representative chop and
financial chop, of such Subsidiaries as required to effect such resignations and
the replacement of such directors and supervisor.

 

Section 7.8     Governmental Approvals and Consents.

 

(a)     Each Party shall, or shall cause its ultimate parent entity (as that
term is defined in the HSR Act) to (i) make, or cause or be made, as promptly as
practicable, and in the case of any notification under the HSR Act, within two
Business Days after the execution of this Agreement, all filings and submissions
(including those under the HSR Act and applicable Competition Laws) required
under any Law applicable to such Party or any of its Affiliates, including those
listed on Schedule 8.1(b); and (ii) as promptly as practicable, use commercially
reasonable efforts to obtain, or cause to be obtained, all consents,
authorizations, waiting period expirations or terminations, orders and approvals
from all Governmental Authorities that may be or become necessary for its
execution and delivery of this Agreement and the performance of its obligations
pursuant to this Agreement and the Ancillary Documents. Each Party shall
cooperate fully with the other Party and its Affiliates in promptly seeking to
obtain all such consents, authorizations, orders and approvals. Parent shall be
responsible for making all filings required under non-U.S. Competition Laws with
the reasonable cooperation of the Company. The Parties shall not willfully take
any action the intent of which is to have the effect of delaying, impairing or
impeding the receipt of any required consents, authorizations, orders and
approvals. Neither Party shall request or otherwise seek early termination of
any required waiting period under any Competition Law.

 

(b)     The Company shall use commercially reasonable efforts to give all
notices to, and obtain all consents (including the Required Consents) from, all
third parties that are described in Section 4.4 of the Company Disclosure
Letter.

 

(c)     Without limiting the generality of the Parties’ undertakings pursuant to
subsections (a) and (b) above, each of the Parties shall use all commercially
reasonable efforts to:

 

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(i)     respond to any inquiries by any Governmental Authority regarding
antitrust or other matters with respect to the transactions contemplated by this
Agreement or any Ancillary Document;

 

(ii)     avoid the imposition of any order or the taking of any action that
would restrain, alter or enjoin the transactions contemplated by this Agreement
or any Ancillary Document; and

 

(iii)     in the event any order, writ, judgment, injunction, decree or
stipulation entered into or with any Governmental Authority adversely affecting
the ability of the Parties to consummate the transactions contemplated by this
Agreement or any Ancillary Document has been issued, to have such order, writ,
judgment, injunction, decree or stipulation vacated or lifted.

 

(d)     All analyses, appearances, meetings, discussions, presentations,
memoranda, briefs, filings, arguments, and proposals made by or on behalf of any
Party before any Governmental Authority or the staff or regulators of any
Governmental Authority, in connection with the transactions contemplated
hereunder (but, for the avoidance of doubt, not including any interactions
between a Party and Governmental Authorities in the ordinary course of business,
any disclosure which is not permitted by Law or any disclosure containing
competitively sensitive information) shall be disclosed to the other Parties in
advance of any filing, submission or attendance, it being the intent that the
Parties will consult and cooperate with one another, and consider in good faith
the views of one another, in connection with any such analyses, appearances,
meetings, discussions, presentations, memoranda, briefs, filings, arguments, and
proposals. Without limiting the generality of the foregoing, each Party shall
provide to the other (or the other’s respective advisors) upon request copies of
all correspondence between such Party and any Governmental Authority relating to
the transactions contemplated by this Agreement. The Parties may, as they deem
advisable and necessary, designate any competitively sensitive materials
provided to the other under this Section 7.8 as “counsel only.” Such materials
and the information contained therein shall be given only to counsel of the
recipient and will not be disclosed by such counsel to employees, officers, or
directors of the recipient without the advance written consent of the Party
providing such materials. Each Party shall give notice to the other Parties with
respect to any meeting, discussion, appearance or contact with any Governmental
Authority or the staff or regulators of any Governmental Authority in connection
with the transactions contemplated hereunder, with such notice being sufficient
to provide the other Parties with the opportunity to attend and participate in
such meeting, discussion, appearance or contact if acceptable to the relevant
Governmental Authority and except to the extent that any portion of such
meeting, discussion, appearance or contact includes the discussion of
competitively sensitive information.

 

(e)     Parent shall not, and shall cause its Affiliates not to, acquire or
agree to acquire, by merging with or into or consolidating with, or by
purchasing a substantial portion of the assets of or equity in, or by any other
manner, any business or any corporation, partnership, association or other
business organization or division thereof, or otherwise acquire or agree to
acquire any assets, if the entering into of a definitive agreement relating to,
or the consummation of such acquisition, merger or consolidation would
reasonably be expected to: (i) impose any material delay in the obtaining of, or
materially increase the risk of not obtaining, any consents of any Governmental
Authority necessary to consummate the transactions contemplated by this
Agreement or the expiration or termination of any applicable waiting period;
(ii) materially increase the risk of any Governmental Authority seeking or
entering an Order prohibiting the consummation of the transactions contemplated
by this Agreement; (iii) materially increase the risk of not being able to
remove any such Order on appeal or otherwise; or (iv) materially delay or
prevent the consummation of the transactions contemplated by this Agreement.

 

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(f)     Notwithstanding anything in this Agreement to the contrary, nothing in
this Agreement shall require, or be construed to require, Parent or any of its
Affiliates to agree to (i) sell, hold, divest, discontinue or limit, before or
after the Closing Date, any assets, businesses or interests of Parent, the
Company or any of their respective Affiliates; (ii) any conditions relating to,
or changes or restrictions in, the operations of any such assets, businesses or
interests which, in either case, could reasonably be expected to result in a
Company Material Adverse Effect or materially and adversely impact the economic
or business benefits to Parent of the transactions contemplated by this
Agreement; or (iii) any material modification or waiver of the terms and
conditions of this Agreement. The Company and its Subsidiaries and Affiliates
will not be required to agree to or take any actions described in subparts i and
ii that are not conditioned on the Closing.

 

(g)     The Company shall make all filings and reportings to Tax Authorities
necessary under Circular 698 within the specified time period set out in
Circular 698 and shall, to the extent required by applicable Law, pay when due
and payable any amounts due in respect of any Tax arising as a result of the
transactions contemplated hereby (including the Merger) and the filing
contemplated by this Section 7.8(g) to the appropriate Taxing Authority in the
People’s Republic of China (which amounts shall be borne solely by the Company
and shall be included in Company Transaction Expenses). The Company shall,
within three Business Days after the submission of any filing under Circular
698, deliver a written certification to Parent certifying that the Company has
submitted the Circular 698 filing; provided, however, that if a receipt of
submission is issued to the Company by the Tax Authorities for the Circular 698
filing, the Company shall deliver the related receipt to Parent within three
Business Days after receiving such receipt. The Company shall ensure that any
filing under Circular 698 shall be complete and correct.

 

Section 7.9     Environmental Testing. Prior to the Closing Date, Parent shall
have the right, but no obligation, to conduct a Phase I Environmental Site
Assessment (or the equivalent thereof in a jurisdiction outside the United
States) and all such other appropriate or applicable environmental due diligence
(the “Phase I Environmental Site Assessment”) with respect to each parcel of
Real Property, and Parent shall be permitted to undertake such activities to
establish the “bona fide prospective purchaser” defense (or any equivalent
defense in any jurisdiction outside the United States) under applicable
Environmental Laws. The Company shall provide Parent and its representatives and
contractors with such access to the Real Property as is necessary to conduct the
Phase I Environmental Site Assessments. The Company shall cooperate in good
faith with any requirements to complete the Phase I Environmental Site
Assessments at the Real Property, including, without limitation, completion of a
questionnaire as required by the ASTM 1527 Phase I standard. Parent shall be
responsible for all costs incurred by Parent in conducting any Phase I
Environmental Site Assessments.

 

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Section 7.10     Representations and Warranties Insurance Policy. On or prior to
the date hereof, Parent has obtained from AIG Specialty Insurance Company a
binder agreement and draft form of policy, a copy of which is attached hereto as
Exhibit E, with respect to a buyer-side representations and warranties insurance
policy from AIG Specialty Insurance Company to provide for coverage in an amount
of $16 million for Losses arising from the breach by the Company of
representations and warranties set forth in Article IV (the “Representations and
Warranties Insurance Policy”). The Company shall pay 50% of the total costs of
the Representations and Warranties Insurance Policy, including premium,
underwriting fees and commissions, brokerage fees, legal fees (if any) for
counsel engaged by the underwriter, surplus lines tax, and any diligence fees or
other fees and expenses incurred by the broker or underwriter of the
Representations and Warranties Policy to the extent payable by Parent, to obtain
the Representations and Warranties Insurance Policy (the “Company Insurance
Expense”); provided, however, that the Company shall not pay in excess of
$500,000. Such payment by the Company of the Company Insurance Expense shall be
included in the Company Transaction Expenses.

 

Section 7.11     Indemnification of Directors and Officers.

 

(a)     At or prior to the Closing, the Company shall purchase (at its sole
expense) an extended reporting period endorsement to the Company’s currently
existing directors’ and officers’ liability insurance (the “Tail Policy”) with
respect to matters existing or occurring at or prior to the Closing
(“Pre-Closing Claims”) and covering a period of six (6) years from and after the
Closing Date, which endorsement Parent and Surviving Corporation agree to
maintain in full force and effect for its full term. The certificate of
incorporation and bylaws of the Surviving Corporation shall contain provisions
with respect to indemnification and exculpation that are at least as favorable
to the past and present officers and directors of the Company as those
provisions contained in the Company Charter and Company Bylaws, respectively in
effect on the date hereof, and such provisions shall not be amended, repealed or
otherwise modified for a period of six (6) years following the Closing in any
manner that would have the effect of impairing the coverage available under the
Tail Policy with respect to Pre-Closing Claims (unless such modification is
required by applicable Law).

 

(b)     If Parent, the Surviving Corporation or any of their successors or
assigns (i) consolidates with or merges into any other person and shall not be
the continuing or surviving corporation or entity of such consolidation or
merger or (ii) transfers or conveys all or substantially all of its properties
and assets to any person, then, and in each such case, to the extent necessary,
proper provision shall be made so that the successors and assigns of Parent or
the Surviving Corporation, as the case may be, shall assume the obligations set
forth in this Section 7.11.

 

(c)     The provisions of this Section 7.11 are intended for the benefit of, and
shall be enforceable by, all past and present officers and directors of the
Company and his or her heirs and representatives. The rights of all past and
present officers and directors of the Company under this Section 7.11 are in
addition to, and not in substitution for, any other rights to indemnification or
contribution that any such person may have by contract, applicable Law or
otherwise.

 

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Section 7.12     Company Warrants; Other Agreements. Promptly after the
execution of this Agreement and in any event prior to Closing, the Company shall
take all such actions as are necessary (a) including the provision of timely
notice, to cause each Warrantholder to convert or exercise such Warrantholder’s
Company Warrants into shares of Company Preferred Stock and cause the
cancellation of such Company Warrants such that there shall be no Company
Warrants outstanding as of the Closing and (b) to cause the agreements listed in
Section 4.2(f) of the Company Disclosure Letter to have been terminated and of
no further force or effect.

 

Section 7.13     Benefit Plans. The Company shall adopt board resolutions and
Employee Benefit Plan amendments, to the extent necessary, effective as of such
date prior to the Closing Date as may be directed by the Parent and subject to
the consummation of the Closing, providing for the termination and/or
liquidation of any Employee Benefit Plan that the Parent directs the Company to
so terminate and/or liquidate upon at least ten (10) Business Days’ notice prior
to the Closing. The form and substance of any resolutions, plan amendments,
documents or notices required to effect any such termination and/or liquidation
shall be subject to review and approval of the Parent in advance of execution
and performance, which such approval shall not be unreasonably withheld or
delayed. The termination and payout of any such Employee Benefit Plan that is
subject to Section 409A of the Code shall be consummated consistent with the
rules under Section 409A of the Code. In connection with the termination and
payout of any Employee Benefit Plan, the Company shall direct the trustee of any
related trust or holder of any other funds held to fund any such Employee
Benefit Plans to pay to the applicable participants or beneficiaries or
distribute to the Company, as applicable, prior to, as of or after Closing, as
the Parent may direct (but in accordance with the terms of the applicable
Employee Benefit Plan and applicable Law), all amounts held in such trusts or
other funds, subject to the receipt of appropriate payoff letters and net of
applicable income, employment and other tax withholdings.

 

Section 7.14     Excess Parachute Payments. To the extent required to avoid the
imposition of taxes under Section 4999 of the Code or the loss of deduction
under Section 280G of the Code with respect to any payment or benefit in
connection with the Merger, prior to the Closing, the Company shall obtain a
waiver from each “disqualified individual” within the meaning of Section 280G(c)
of the Code with respect to the Company and/or its Subsidiaries who has received
or may receive any payment or benefits (the “Waived 280G Benefits” and each such
waiver, the “280G Waiver”) so that all remaining payments and benefits, if any,
shall not constitute “excess parachute payments” within the meaning of Section
280G(a) of the Code and, prior to the Closing, submit to the Company
Stockholders and/or such other Persons entitled to vote for approval in a manner
that satisfies the applicable requirements of Section 280G(b)(5)(B) of the Code
and the Treasury Regulations thereunder, the rights of any such “disqualified
individual” to receive any Waived 280G Benefits. The form and substance of any
such actions, documents, consents or other steps required to effect any of the
foregoing shall be subject to review and approval of Parent, which such approval
shall not be unreasonably withheld or delayed, in advance of execution and
performance.

 

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Article VIII

CONDITIONS PRECEDENT TO CONSUMMATION OF THE MERGER

 

Section 8.1     Conditions Precedent to Obligations of Each Party. The
obligations of each Party to consummate the Merger are subject to the
satisfaction or waiver at or prior to the Effective Time of the following
conditions precedent:

 

(a)     The Company Stockholder Approval shall have been obtained.

 

(b)     In accordance with the HSR Act and Competition Laws, all filings
described on Schedule 8.1(b) hereto shall have been made and all consents,
approvals, notices, judgments or other actions in respect of such filings shall
have been obtained on terms acceptable to Parent and the Company and all
compulsory waiting periods (including extensions thereto) under the filings
described in Schedule 8.1(b) shall have expired or been earlier terminated.

 

(c)     No temporary restraining order, preliminary or permanent injunction or
other order preventing the consummation of the Merger shall have been issued by
any court of competent jurisdiction or any other Governmental Authority and
shall remain in effect, and there shall not be any Law, action or proceeding
enacted, promulgated, adopted or deemed applicable to the Merger that makes
consummation of the Merger illegal or otherwise prohibits the consummation of
the Merger.

 

(d)     There shall not be pending or threatened in writing (or to the Knowledge
of the Company or the knowledge of Parent, threatened) any material action or
proceeding brought by a Governmental Authority seeking to enjoin or restrain
consummation of the transactions contemplated by this Agreement, or seeking
damages in connection with such transactions.

 

Section 8.2     Conditions Precedent to Obligations of Parent and Merger
Subsidiary. The obligations of Parent and Merger Subsidiary to consummate the
Merger are subject to the satisfaction or waiver at or prior to the Effective
Time of the following conditions precedent:

 

(a)     Each of the representations and warranties of the Company contained in
this Agreement that is qualified by materiality or Company Material Adverse
Effect shall be true and correct on and as of the Closing Date as if made on and
as of such date (other than representations and warranties which address matters
only as of a certain date which shall be true and correct as of such certain
date), and each of the representations and warranties that is not so qualified
shall be true and correct in all material respects on and as of the Closing Date
as if made on and as of such date (other than representations and warranties
which address matters only as of a certain date which shall be true and correct
in all material respects as of such certain date).

 

(b)     Each of the covenants, agreements and obligations of the Company to be
performed at or before the Effective Time pursuant to the terms of this
Agreement shall have been duly performed in all material respects at or before
the Effective Time.

 

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(c)     Since the date of this Agreement, there shall not have occurred any
fact, circumstance, event, change, effect, development or occurrence which,
individually or in the aggregate, has had, or would reasonably be expected to
have, a Company Material Adverse Effect.

 

(d)     No greater than five percent (5%) of the issued and outstanding shares
of Company Capital Stock shall be Dissenting Shares as of the Closing Date.

 

(e)     No Governmental Authority having competent jurisdiction to enforce
applicable Competition Laws shall have threatened in writing (or to the
Knowledge of the Company or the knowledge of Parent, threatened), enacted,
issued, enforced or passed any notice, judgment, order, decree, or injunction
(solely on account of the Merger and the transactions proposed to be consummated
hereunder), which shall (i) make consummation of the Merger illegal or otherwise
prohibit the consummation of the Merger or (ii) have the effect of limiting or
restricting Parent’s, the Company’s or their respective Affiliates’ right or
ability to conduct business anywhere in the world in a manner that is
satisfactory to Parent.

 

(f)     The Company shall have delivered to Parent and Merger Subsidiary each of
the deliverables required to be delivered pursuant to Section 2.4(a).

 

(g)     Parent shall have obtained evidence that the Representations and
Warranties Insurance Policy issued by AIG Specialty Insurance Company, or
another nationally-recognized insurance company reasonably acceptable to Parent
is in full force and effect.

 

(h)     The Company shall have delivered to Parent a flash drive containing the
entire contents of the virtual data room as of the date hereof.

 

(i)     All Company Warrants shall have been exercised or converted into shares
of Company Preferred Stock prior to the Closing Date such that such shares of
Company Preferred Stock are treated for all purposes of this Agreement as
outstanding shares of Company Preferred Stock and all such Company Warrants
shall be deemed cancelled and null and void.

 

(j)     All of the outstanding equity of Ethertronics Limited, a Hong Kong
company, shall have been validly transferred from Laurent Desclos to the Company
prior to Closing and the Company shall have delivered evidence thereof to Parent
in form and substance acceptable to Purchaser.

 

Section 8.3     Conditions Precedent to Obligations of the Company. The
obligations of the Company to consummate the Merger are subject to the
satisfaction or waiver at or prior to the Effective Time of the following
conditions precedent:

 

(a)     Each of the representations and warranties of Parent and Merger
Subsidiary contained in this Agreement that is qualified by materiality shall be
true and correct on and as of the Closing Date as if made on and as of such date
(other than representations and warranties which address matters only as of a
certain date which shall be true and correct as of such certain date), and each
of the representations and warranties that is not so qualified shall be true and
correct in all material respects on and as of the Closing Date as if made on and
as of such date (other than representations and warranties which address matters
only as of a certain date which shall be true and correct in all material
respects as of such certain date).

 

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(b)     Each of the covenants, agreements and obligations of Parent and Merger
Subsidiary to be performed at or before the Effective Time pursuant to the terms
of this Agreement shall have been duly performed in all material respects at or
before the Effective Time.

 

(c)     Parent and Merger Subsidiary shall have delivered to the Company each of
the deliverables required to be delivered pursuant to Section 2.4(b).

 

Section 8.4     Frustration of Closing Conditions. None of the Company, Parent
or Merger Subsidiary may rely, either as a basis for not consummating the Merger
or terminating this Agreement and abandoning the Merger, on the failure of any
condition set forth in Section 8.1, Section 8.2 or Section 8.3, as the case may
be, to be satisfied if such failure was caused by such Party’s breach of any
provision of this Agreement or failure to use its commercially reasonable
efforts to consummate the Merger and the other transactions contemplated hereby,
as required by and subject to Section 7.2.

 

Article IX

TERMINATION

 

Section 9.1     Termination. Anything herein or elsewhere to the contrary
notwithstanding, this Agreement may be terminated and the Merger contemplated
herein may be abandoned at any time prior to the Effective Time, whether before
or after Company Stockholder Approval thereof:

 

(a)     By the mutual written consent of Parent and the Company.

 

(b)     By either of the Company or Parent:

 

(i)     if the Merger shall not have been consummated on or before March 31,
2018 (the “Walk-Away Date”); provided, however, that if the conditions set forth
in Section 8.1(b) shall not have been satisfied or waived as of the Walk-Away
Date but all other conditions set forth in Article VIII shall have been
satisfied or waived (other than those conditions that by their terms are to be
satisfied at the Closing, but provided that such conditions shall then be
capable of being satisfied if the Closing were to take place on such date), then
the Walk-Away Date shall be automatically extended to the date that is three
months after the Walk-Away Date (the “Extended Termination Date”), unless Parent
does not reasonably believe that the conditions set forth in Section 8.1(b) are
capable of being satisfied on or prior to the Extended Termination Date;
provided, further, that the right to terminate this Agreement under this Section
9.1(b)(i) shall not be available to a Party if the failure of the Merger to have
been consummated on or before the Walk-Away Date was primarily due to the
failure of such Party to perform any of its obligations under this Agreement;
and provided, further, that the right to terminate this Agreement under this
Section 9.1(b)(i) shall not be available to the Company if a vote on the
adoption and approval of this Agreement and the Merger shall not yet have
occurred; or

 

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(ii)     if any Governmental Authority shall have issued an order, decree or
ruling or taken any other action in each case permanently restraining, enjoining
or otherwise prohibiting the transactions contemplated by this Agreement and
such order, decree, ruling or other action shall have become final and
non-appealable (any such order, decree, ruling or other action, a “Final
Order”); provided, however, that (A) the right to terminate this Agreement under
this Section 9.1(b)(ii) shall not be available to a Party if the imposition,
existence or occurrence of such order, decree, ruling or other action was caused
or resulted from the breach of any representations, warranties, covenants or
other agreements of such Party contained in this Agreement, and (B) the Party
seeking to terminate this Agreement shall have used all commercially reasonable
efforts to challenge such order, decree, ruling or other action;

 

(c)     By the Company if Parent shall have breached or failed to perform any of
its representations, warranties, covenants or agreements set forth in this
Agreement, which breach or failure to perform (i) would give rise to the failure
of a condition set forth in Section 8.3(a) or Section 8.3(b) and (ii) cannot be
cured by Parent by the Walk-Away Date or, if curable, is not cured within ten
Business Days after Parent receives written notice from the Company of such
breach;

 

(d)     By Parent if the Company shall have breached or failed to perform any of
its representations, warranties, covenants or agreements set forth in this
Agreement, which breach or failure to perform (i) would give rise to the failure
of a condition set forth in Section 8.2 and (ii) cannot be cured by the Company
by the Walk-Away Date or, if curable, is not cured within ten Business Days
after the Company receives written notice from Parent of such breach; or

 

(e)     By Parent if the Stockholder Consent shall not have been delivered to
Parent by the Company prior to 11:59 p.m. (Wilmington, Delaware time) on the
second Business Day following the date of this Agreement.

 

Section 9.2     Effect of Termination. In the event of the termination of this
Agreement as provided in Article IX, written notice thereof shall forthwith be
given to the other Party or Parties specifying the provision hereof pursuant to
which such termination is made, and this Agreement (other than the
confidentiality provisions of Section 7.1 and the provisions of Article IX and
Section 9.3 and Article XII) shall forthwith become null and void, and there
shall be no liability on the part of Parent or the Company, except as provided
in Section 9.3; provided, however, that nothing in this Section 9.2 shall
relieve any Party from liability for any breach (occurring prior to any such
termination) of any of the representations, warranties, covenants, or agreements
set forth in this Agreement or any Fraud or intentional misrepresentation.

 

Section 9.3     Expenses. All fees and expenses incurred by the Parties hereto
shall be borne solely by the Party that has incurred such fees and expenses,
whether or not the Merger is consummated.

 

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Article X

TAX MATTERS

 

Section 10.1     Tax Indemnification.

 

(a)     The Company Stockholders shall, jointly and severally (provided that no
Company Stockholder would have an indemnification obligation under this Section
10.1 in excess of 120% of such Company Stockholder’s Pro Rata Share of such
Losses and provided further that in no event shall the liability of any Company
Stockholder under this Agreement exceed such Company Stockholder’s respective
Pro Rata Share of the Merger Consideration actually received by such Company
Stockholder), indemnify, defend and hold harmless Parent Indemnified Parties,
including the Company and the Subsidiaries after the Closing, and hold them
harmless from and against any and all Losses to the extent arising out of or
resulting from, without duplication, any and all Taxes (or the nonpayment
thereof) of the Company Stockholders and their Affiliates for any taxable
period, the Company and the Subsidiaries for a Pre-Closing Tax Period, all Taxes
of any member of an affiliated, consolidated, combined or unitary group of which
the Company or any Subsidiary (or any predecessor of any of the foregoing) is or
was a member on or prior to the Closing Date, including pursuant to Treasury
Regulations Section 1.1502-6 or any analogous or similar state, local, or
non-U.S. law or regulation, and any and all Taxes of any Person imposed on the
Company or any Subsidiary as a transferee or successor, by contract (other than
any Commercial Tax Agreement) or pursuant to any Law, which Taxes relate to an
event or transaction occurring on or before the Closing Date; provided, however,
that the Company Stockholders shall be liable only to the extent that such Taxes
exceed the amount, if any, taken specifically into account in calculating the
Closing Working Capital; and provided, further, that the indemnification
provided for in Section 10.1(a)(ii), Section 10.1(a)(iii) and Section
10.1(a)(iv) shall be subject to a maximum indemnification amount equal to the
Indemnification Escrow Amount then remaining in escrow, provided that after the
exhaustion of the Indemnification Escrow Amount, nothing shall prevent Parent
from making a claim under, or being indemnified pursuant to, the Representations
and Warranties Insurance Policy.

 

(b)     Parent shall indemnify the Company Stockholders and hold them harmless
from and against any and all Losses to the extent arising out of or resulting
from, without duplication, any and all Taxes of the Company and the Subsidiaries
for any Post-Closing Tax Period, except to the extent such Tax is attributable
to the breach of the covenants set forth in this Agreement by the Company or
Stockholder Representative.

 

Section 10.2     Allocation of Tax Liability for Straddle Periods. For purposes
of the Tax reimbursement and indemnity provisions of this Agreement, in the case
of any Taxes that are imposed on a periodic basis and are payable for a Straddle
Period, the portion of such Tax related to the portion of such Tax period ending
on and including the Closing Date shall (a) in the case of any Taxes other than
gross receipts, employment Taxes, sales or use Taxes and Taxes based upon or
related to income, be deemed equal to the amount of such Tax for the entire Tax
period multiplied by a fraction the numerator of which is the number of days in
the Tax period ending on and including the Closing Date and the denominator of
which is the number of days in the entire Tax period, and (b) in the case of any
Tax based upon or related to income and any gross receipts, employment Tax,
sales or use Tax, be deemed equal to the amount which would be payable if the
relevant Tax period ended on and included the Closing Date.

 

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Section 10.3     Cooperation; Audits. In connection with the preparation of Tax
Returns, Proceedings relating to the Tax liabilities imposed on the Company or
any Subsidiary for all Pre- Closing Tax Periods, the Parent, on the one hand,
and Stockholder Representative, on the other hand, shall reasonably cooperate
with each other, including the furnishing or making available during normal
business hours of records, personnel (as reasonably required), books of account,
or other materials necessary or helpful for the preparation of such Tax Returns,
the conduct of audit examinations or the defense of claims by Tax Authorities as
to the imposition of Taxes and any assessment or reassessment in respect of
Taxes. Parent shall, and shall cause the Company and the Subsidiaries to, retain
all books and records with respect to Tax Proceedings pertinent to the Company
and the Subsidiaries relating to any taxable period beginning before the Closing
Date until the expiration of the applicable statute of limitations (and, to the
extent notified by Stockholder Representative, any extension thereof) for the
respective taxable periods, and to abide by all record retention Laws and
agreements entered into with any Tax Authority.

 

Section 10.4     Tax Returns.

 

(a)     Tax Returns due on or before the Closing Date. The Company shall prepare
(or cause to be prepared) and timely file (or cause to be timely filed) all Tax
Returns of the Company and the Subsidiaries that are due on or before the
Closing Date (taking into account applicable extensions) and shall pay (or cause
to be paid) all Taxes due with respect to such Tax Returns. All such Tax Returns
shall be prepared in accordance with the past practice of the Company and the
Subsidiaries, as applicable, in filing Tax Returns unless otherwise required by
applicable Law. The Company shall deliver (or cause to be delivered) such Tax
Returns to the Parent no less than thirty (30) days in the case of any such
Income Tax Return or as soon as practical in the case of any other Tax Return
prior to the applicable filing deadline (taking into account applicable
extensions) for the Parent’s review and comment. The Company shall make or cause
to be made all changes reasonably requested by the Parent with respect to any
such Tax Returns.

 

(b)     Tax Returns due after the Closing Date.

 

(i)     For any Straddle Period, the Company shall prepare (or cause to be
prepared) and timely file (or cause to be timely filed), taking into account
extensions, all Tax Returns of the Company and the Subsidiaries (the “Straddle
Tax Returns”) and shall deliver or cause to be delivered such Straddle Tax
Returns to Stockholder Representative no less than thirty (30) days in the case
of any Income Tax Return or ten (10) days in the case of any other Tax Return
prior to the applicable filing deadline (taking into account applicable
extensions) for Stockholder Representative’s review and comment. The Company
shall make or cause to be made all changes reasonably requested by Stockholder
Representative with respect to any Straddle Tax Returns.

 

(ii)     For any Income Tax Return for a taxable period that ends on or before
the Closing Date and that is required to be filed by the Company or the
Subsidiaries after the Closing Date (taking into account applicable extensions)
(the “Pre-Closing Income Tax Returns”), the Company shall timely prepare or
cause to be prepared such Pre-Closing Income Tax Returns and shall deliver or
cause to be delivered such Pre-Closing Income Tax Returns to the Parent no less
than thirty (30) days prior to the applicable filing deadline (taking into
account applicable extensions) for the Parent’s review and comment. The Company
shall make or cause to be made all changes reasonably requested by the Parent
with respect to any Pre-Closing Income Tax Returns.

 

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(iii)     For any other Tax Return for a taxable period that ends on or before
the Closing Date and that is required to be filed by the Company or the
Subsidiaries after the Closing Date (taking into account applicable extensions)
(the “Pre-Closing Other Tax Returns”), the Parent shall timely prepare or cause
to be prepared such Pre-Closing Other Tax Returns and shall deliver or cause to
be delivered such Pre-Closing Other Tax Returns to Stockholder Representative as
soon as practical prior to the applicable filing deadline (taking into account
applicable extensions) for Stockholder Representative’s review and consent. If,
after consulting in good faith, the Parties are unable to resolve any comments
made by Stockholder Representative with respect to a Pre-Closing Other Tax
Return, such Pre-Closing Other Tax Return shall be referred to the Independent
Accountant for resolution. If the Independent Accountant is unable to make a
determination with respect to any disputed item prior to the due date for the
filing of the Pre-Closing Other Tax Return in question, then (x) the Company or
the Subsidiaries, as applicable, shall timely file such Pre-Closing Other Tax
Return in accordance with the reasonable position of the Parent and (y) when the
Independent Accountant subsequently resolves the dispute, the Company or the
Subsidiaries, as applicable, shall promptly file an amended Pre-Closing Other
Tax Return, if necessary reflecting the resolution by the Independent
Accountant. The fees and expenses of the Independent Accountant shall be shared
equally by Stockholder Representative and the Parent.

 

(iv)     All such Straddle Tax Returns, Pre-Closing Income Tax Returns and
Pre-Closing Other Tax Returns (collectively, the “Pre-Closing Tax Returns”)
shall be prepared in accordance and consistently with the past practices of the
Company or the Subsidiaries, as applicable, unless otherwise required by
applicable Law. The Parent or Stockholder Representative, as applicable, shall
provide comments (if any) on or to such Pre- Closing Tax Returns reasonably
prior to the due date for such Pre-Closing Tax Return (taking into account
applicable extensions) and, if the Parent or Stockholder Representative, as
applicable, does not provide any written comments prior to the due date for such
Pre-Closing Tax Return (taking into account applicable extensions), the Parent
or Stockholder Representative, as applicable shall be deemed to have accepted
such Tax Return. Parent shall pay or cause to be paid any Taxes shown as due on
any Pre-Closing Tax Return.

 

Section 10.5     Tax Controversies. Notwithstanding any other provision of this
Agreement, this Section 10.5 shall control any Proceedings with respect to Taxes
or Tax Returns (a “Tax Proceeding”). The Parent, on the one hand, and
Stockholder Representative, on the other, shall inform the other in writing
promptly after receipt of notice of any Tax Proceeding from any Tax Authority
which may be the subject of an indemnification claim pursuant to Section 10.1 of
this Agreement; provided, however, a failure to give such notice shall not
affect a Party’s rights to indemnification hereunder except to the extent the
indemnifying party is prejudiced by such failure. Such notice shall include a
copy of the relevant portion of any correspondence received from the relevant
Tax Authority and describe in reasonable detail the nature of such Tax
Proceeding. With respect to any Tax Proceeding for which the Company
Stockholders may have an indemnification obligation pursuant to this Agreement,
the Parent shall not enter into any settlement of, otherwise compromise or
abandon any such Tax Proceeding without the prior written consent of Stockholder
Representative, which consent shall not be unreasonably withheld, conditioned or
delayed, and the Parent shall keep Stockholder Representative duly informed with
respect to such Tax Proceedings.

 

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Section 10.6     Transfer Taxes. All transfer, documentary, sales, use, stamp,
registration and other similar Taxes and fees (including any penalties and
interest) incurred in connection with the Merger will be paid fifty percent by
the Parent and fifty percent by the Company Stockholders (and such portion shall
be Company Transaction Expenses) when due, and the Parent and Stockholder
Representative shall cooperate in the execution of filing of all necessary Tax
Returns and other documentation with respect to all such Taxes and fees.

 

Section 10.7     Treatment as Purchase Price Adjustment. For Tax purposes, the
Parties agree to treat all indemnification payments made under this Agreement as
adjustments to the Purchase Price unless otherwise required by applicable Law.

 

Section 10.8     Tax Sharing Agreements. Other than with respect to Commercial
Tax Agreements, the Company shall cause all Tax allocation agreements or Tax
sharing agreements between the Company or any of Subsidiary, on the one hand,
and any Affiliate of the Company (other than a Subsidiary), on the other hand,
to be terminated as of the Closing Date.

 

Section 10.9     Survival, Conflict of Provisions and Procedures. The covenants
provided in this Article X shall survive indefinitely. In the event of any
conflict between this Article X and Article XI, as it relates to Taxes, this
Article X shall govern. Claims by, and payments to, an indemnified party
pursuant to Section 10.1 shall be made utilizing the procedures set forth in
Section 11.3(a).

 

Article XI

INDEMNIFICATION

 

Section 11.1     Indemnification by the Company Stockholders.

 

(a)     The Company Stockholders shall, severally and not jointly (in accordance
with their Pro Rata Shares) indemnify, defend and hold harmless Parent, Merger
Subsidiary and the Surviving Corporation, each of their respective successors
and assigns and their respective directors, officers, agents, representatives
and employees (collectively, the “Parent Indemnified Parties”) from and against
any and all, without duplication, liability, loss, damage, claim, charge,
action, suit, proceeding, investigation, deficiency, Tax, interest, penalty,
reasonable cost and reasonable expense (including, without limitation,
reasonable attorneys’ fees) that (a) with respect to any Third-Party Claim, are
actually paid by an Indemnified Party and (b) with respect to any claim that is
not a Third-Party Claim, exclude any punitive damages or damages pursuant to
statute that provide for multiple-based damages (a “Loss”) to the extent imposed
on, incurred or suffered by or asserted against any Parent Indemnified Party, to
the extent such Loss results from or arises out of:  any breach or inaccuracy of
any of the representations and warranties made by the Company in this Agreement
or any Ancillary Document,  any failure of the Company to carry out, perform,
satisfy and discharge any of its covenants, agreements, undertakings,
liabilities or obligations under this Agreement or any Ancillary Document; (iii)
any claim made by any Company Stockholder, Optionholder or Warrantholder
relating to such Person’s rights with respect to the Merger Consideration or any
other consideration hereunder, or the calculations and determinations set forth
on the Consideration Spreadsheet; (iv) any amounts paid to the holders of
Dissenting Shares, including any interest required to be paid thereon, that are
in excess of what such holders would have received hereunder had such holders
not been holders of Dissenting Shares; (v) Net Debt in excess of $8,000,000; or
(vi) any Company Transaction Expenses outstanding as of the Closing to the
extent not paid or satisfied by the Company or a Subsidiary at or prior to the
Closing; provided, however, that the Parent Indemnified Parties shall have the
right to be indemnified, held harmless from, defended or reimbursed under
Section 11.1(a)(i) in respect of the representations and warranties made by the
Company only if such right is asserted (whether or not such Losses have actually
been incurred) on or before the respective dates set forth below:

 

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For Representations and
Warranties Set Forth
in the Following Sections:

 

All Claims Must be
Asserted by:

 

Section 4.1 (first sentence only) (Due Organization), Section 4.2
(Capitalization), Section 4.6(a) (Title to Assets), Section 4.7(c) (Title to
Real Property) and Section 4.17(b) (Title to Intellectual Property) (the
“Fundamental Representations”)

The later of (i) the expiration of the duration of the claims period of the
Representations and Warranties Insurance Policy, and (ii) six years after the
Closing Date.

Section 4.10 (Employee Benefit Plans), Section 4.12 (Tax Matters) and Section
4.16 (Environmental Matters)

The later of (i) the expiration of the duration of the claims period of the
Representations and Warranties Insurance Policy, and (ii) within 60 days after
the expiration of the applicable statute of limitations (including extensions).

Other representations and warranties

The later of (i) the expiration of the duration of the claims period of the
Representations and Warranties Insurance Policy and (ii) 18 months after the
Closing Date.

 

(b)     Notwithstanding anything expressed or implied in this Article XI to the
contrary, none of the Parent Indemnified Parties shall be entitled to
indemnification for any Losses arising from a claim for indemnification pursuant
to Section 11.1(a)(i) from and after such time that the aggregate amount of
Losses for which the Indemnified Parties have been indemnified under Section
11.1(a)(i) hereof exceeds the Indemnification Escrow Amount (the “Cap”).
Recovery for Losses incurred by Parent Indemnified Parties shall come first from
the Indemnification Escrow Fund in accordance with the terms of this Agreement
and the Escrow Agreement until the Indemnification Escrow Fund has been fully
exhausted or disbursed from the Indemnification Escrow Fund, at which point the
Parent Indemnified Parties’ sole source of recovery for claims under Section
11.1(a)(i) shall be through the Representations and Warranties Insurance Policy
in accordance with the terms thereof. For purposes of clarity and the avoidance
of doubt, resort against the Indemnification Escrow Fund shall be the Parent
Indemnified Parties’ sole and exclusive remedy against the Company Stockholders
for any breach or inaccuracy of any of the representations and warranties made
by the Company in this Agreement or any Ancillary Document, except for claims
based on Fraud or intentional misrepresentation. Notwithstanding anything to the
contrary in this Agreement (including the preceding sentence), (i) in no event
will any Parent Indemnified Parties be required to bring a claim to recover
Losses under the Representations and Warranties Insurance Policy, and (ii) the
existence of the Representations and Warranties Insurance Policy or any claims
relating thereto shall not in any way limit any Parent Indemnified Parties’
ability to recover from the Indemnification Escrow Fund in accordance with the
terms of this Agreement and the Escrow Agreement. In the event of any payment by
the insurer under the Representations and Warranties Insurance Policy, the
insurer shall be subrogated to all of Parent’s and the Company’s respective
rights of recovery against any Person based upon, arising out of or relating to
such payment, but the Indemnifying Party’s obligations shall remain subject to
the limitations set forth in this Article XI. In no event shall the liability of
any Company Stockholder under this Agreement exceed such Company Stockholder’s
respective Pro Rata Share of the Merger Consideration actually received by such
Company Stockholder.

 

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(c)     Absent Fraud or intentional misrepresentation, an Indemnifying Party
shall not have any liability under Section 11.1(a)(i) hereof unless the
aggregate amount of Losses incurred by the Parent Indemnified Parties and
indemnifiable hereunder based upon, attributable to or resulting from the
failure of any of the representations or warranties to be true and correct
exceeds the Basket and, in such event, the Indemnifying Party shall be required
to pay the entire amount of all such Losses (without deducting the Basket amount
from the calculation of such Losses).

 

Section 11.2     Indemnification by Parent and Merger Subsidiary. Parent and
Merger Subsidiary shall, jointly and severally, indemnify, defend and hold
harmless the Company Stockholders and their directors, officers, agents,
representatives and employees and their respective successors and permitted
assigns (collectively, the “Company Indemnified Parties” and, together with the
Parent Indemnified Parties, collectively referred to as the “Indemnified
Parties”) from and against any and all, without duplication, Losses to the
extent imposed on, incurred or suffered by or asserted against any Company
Indemnified Party, directly or indirectly, to the extent resulting from, arising
out of, or incurred with respect to (in each case except to the extent waived or
deemed waived by the Company in accordance with this Agreement)  any breach or
inaccuracy of any of the representations and warranties made by Parent or Merger
Subsidiary in this Agreement or any other agreement or instrument delivered by
Parent or Merger Subsidiary pursuant to this Agreement; or (b) any failure of
Parent or Merger Subsidiary to carry out, perform, satisfy and discharge any of
its respective covenants, agreements, undertakings, liabilities or obligations
under this Agreement or under any of the agreements and instruments delivered by
Parent or Merger Subsidiary pursuant to this Agreement; provided, however, that
the Company Indemnified Parties shall have the right to be indemnified, held
harmless from, defended or reimbursed under Section 11.2(a) in respect of the
representations and warranties made by Parent or Merger Subsidiary only if such
right is asserted (whether or not such Losses have actually been incurred) on or
before the date that is 18 months after the Closing Date.

 

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Section 11.3     Indemnification Procedures.

 

(a)     In order for an Indemnified Party to be entitled to any indemnification
provided for under this Agreement, including without limitation with respect to
any liabilities and obligations of the Company existing as of the Effective Time
required to be satisfied by the Company as provided in Section 7.5, the
Indemnified Party shall deliver to the party against whom indemnification is
sought in accordance with Section 11.1 or Section 11.2, as the case may be (an
“Indemnifying Party”), notice of its claim for indemnification with reasonable
promptness after determining to make such claim. The failure by any Indemnified
Party to so notify the Indemnifying Party, as the case may be, shall not relieve
the Indemnifying Party from any liability which it may have to such Indemnified
Party under this Agreement, except to the extent that the Indemnifying Party
shall have been materially and adversely prejudiced by such failure. If the
Indemnifying Party disputes its liability with respect to such claim, the
Indemnifying Party and the Indemnified Party shall proceed in good faith to
negotiate a resolution of such dispute and, if not resolved through
negotiations, such dispute shall be resolved by litigation in an appropriate
court of competent jurisdiction as provided in Section 12.6.

 

(b)     If any claim for indemnification under Section 11.1 or Section 11.2
involves the claim of any third party against an Indemnified Party (a
“Third-Party Claim”), the Indemnifying Party may, upon written notice as
provided above (which notice shall acknowledge that such Third-Party Claim is an
indemnifiable claim under this Article XI), assume control over the defense
thereof, with counsel reasonably satisfactory to the Indemnified Party, and,
after written notice from the Indemnifying Party to the Indemnified Party of its
assumption of the defense thereof, the Indemnifying Party shall not be liable to
such Indemnified Party for any legal or other expenses subsequently incurred by
the Indemnified Party in connection with the defense thereof (but the
Indemnified Party shall have the right, but not the obligation, to participate
at its own cost and expense in such defense by counsel of its own choice) or for
any amounts paid or foregone by the Indemnified Party as a result of any
settlement or compromise thereof that is effected by the Indemnified Party
(without the written consent of the Indemnifying Party). If the Indemnifying
Party elects not to, or fails to, assume control over the defense of a
Third-Party Claim, then the Indemnified Party may assume such defense and the
Indemnifying Party shall be required to pay all legal or other expenses,
including, without limitation, reasonable attorneys’ fees and disbursements,
incurred by the Indemnified Party in such defense, subject to the limitations
set forth in Section 11.1(b).

 

(c)     Anything in this Section 11.3 notwithstanding, if both the Indemnifying
Party and the Indemnified Party are named as parties or subject to such
Third-Party Claim and either such party determines in good faith with advice of
counsel that there may be one or more legal defenses available to it that are
different from or additional to those available to the other party that, if the
Indemnified Party and the Indemnifying Party were to be represented by the same
counsel, would constitute a conflict of interest for such counsel or prejudice
the prosecution of the defenses available to such Indemnified Party, then the
Indemnifying Party may decline to assume the defense on behalf of the
Indemnified Party or the Indemnified Party may retain the defense on its own
behalf, and, in either such case, after written notice to such effect is duly
given hereunder to the other party, the Indemnifying Party shall be relieved of
any undertaking to assume the defense on behalf of the Indemnified Party, but
shall be required to pay all legal or other expenses including, without
limitation, reasonable attorneys’ fees and disbursements, incurred by the
Indemnified Party in such defense, subject to the limitations set forth in
Section 11.1(b).

 

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(d)     If the Indemnifying Party assumes the defense of any such Third-Party
Claim, the Indemnified Party shall cooperate fully with the Indemnifying Party
and shall appear and give testimony, produce documents and other tangible
evidence, allow the Indemnifying Party reasonable access to the books and
records of the Indemnified Party and otherwise provide reasonable assistance to
the Indemnifying Party in conducting such defense. No Indemnifying Party shall,
without the written consent of the Indemnified Party (which consent shall not be
unreasonably withheld, conditioned or delayed), consent to entry of any judgment
or enter into any settlement or compromise which does not include as an
unconditional term thereof the giving by the claimant or plaintiff to such
Indemnified Party of a release from all liability in respect of such Third-Party
Claim. Provided that proper notice is duly given, if the Indemnifying Party
elects to assume the defense thereof but fails to promptly and diligently
contest the Third-Party Claim, then the Indemnified Party may respond to,
contest and defend against such Third-Party Claim (but the Indemnifying Party
shall have the right to participate at its own cost and expense in such defense
by counsel of its own choice) and may make in good faith any compromise or
settlement with respect thereto, and recover from the Indemnifying Party the
entire cost and expense thereof including, without limitation, reasonable
attorneys’ fees and disbursements and all amounts paid or foregone as a result
of such Third-Party Claim, or the settlement or compromise thereof, subject to
the limitations set forth in Section 11.1(b). Whether or not the Indemnifying
Party assumes the defense of a Third-Party Claim, the Indemnified Party shall
not admit any liability with respect to, or settle, compromise or discharge,
such Third-Party Claim without the Indemnifying Party’s prior written consent
(which consent shall not be unreasonably withheld, conditioned or delayed).

 

(e)     Notwithstanding the foregoing provisions of this Section 11.3, in
circumstances where Section 11.3(c) does not apply and the Indemnifying Party
has diligently assumed the defense of the Third-Party Claim, the Indemnified
Party shall nonetheless have the right at its own cost and expense to take over
and assume the control (as to itself) of the defense or settlement of the
Third-Party Claim if the Indemnified Party is dissatisfied with the prosecution
of the defense of such Third-Party Claim. The Indemnifying Party shall not be
liable under this Article XI for any settlement or compromise effected without
its consent, and further subject to the limitations set forth in Section
11.1(b).

 

(f)     Any indemnity payment under this Agreement shall be treated as an
adjustment to the Purchase Price and Merger Consideration for Tax purposes,
unless a final determination (which shall include the execution of an IRS Form
870-AD or successor form) with respect to the Indemnified Party or any of its
Affiliates causes any such payment not to be treated as an adjustment to the
Purchase Price and Merger Consideration for United States federal income Tax
purposes.

 

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(g)     The Indemnification Escrow Fund shall expire and terminate on the date
that is 18 months after the Closing Date pursuant to the terms of the Escrow
Agreement, and upon such expiration and termination, the Escrow Agent, upon
receipt of joint written instructions from Parent and the Stockholder
Representative, shall pay any amount remaining in the Indemnification Escrow
Fund to the Company Stockholders as set forth in the Escrow Agreement in
accordance with their Pro Rata Shares; provided, however, that the Escrow Agent
shall retain and not distribute to the Company Stockholders (and the
Indemnification Escrow Fund shall not expire or terminate with respect to) such
portion of the Indemnification Escrow Fund as is equal to the aggregate amount
of any outstanding Losses for which Parent Indemnified Parties have made an
indemnification claim or claims by providing notice thereof pursuant to this
Article XI and which has or have not yet been resolved pursuant to this Article
XI.

 

Section 11.4     Survival of Representations and Warranties. All
representations, warranties and covenants made by the Company in this Agreement
or in any document delivered pursuant hereto shall be deemed to have been made
on the date of this Agreement (except as otherwise provided herein) and, if a
Closing occurs, as of the Closing Date and Effective Time. The representations
and warranties of Parent, Merger Subsidiary and the Company will survive the
Closing and will remain in effect until, and will expire as provided in, Section
11.1(a) and Section 11.2.

 

Section 11.5     Exclusive Remedy. After the Closing, the indemnification
provisions of this Article XI, including recovery against the Indemnification
Escrow Fund and the Representations and Warranties Insurance Policy, will
provide the sole and exclusive remedy for any breach of any representation,
warranty, covenant or obligation or other claim arising out of this Agreement or
the transaction contemplated hereby, except for claims based on Fraud or
intentional misrepresentation. Notwithstanding anything in this Agreement to the
contrary, (a) no limitations (including the limitations set forth in this
Article XI), qualifications or procedures in this Agreement shall be deemed to
apply to any claim for Losses under the Representations and Warranties Insurance
Policy and (b) nothing herein shall prevent Parent or any Affiliate thereof from
making any claim under the Representations and Warranties Insurance Policy.

 

Section 11.6     Fraud and Intentional Misrepresentation. None of the
limitations set forth in this Article XI shall apply to claims based on Fraud or
intentional misrepresentation.

 

Section 11.7     Materiality. For purposes of this Article XI (including the
determination of whether there has been any breach or inaccuracy in the
representation or warranty and the determination of the amount of any Loss that
is subject to indemnification), each representation and warranty in this
Agreement shall be read without regard to, and without giving effect to, the
term “material” or “Company Material Adverse Effect” or “in all material
respects” or other similar qualification contained in, or otherwise applicable
to, such representation or warranty.

 

Article XII

MISCELLANEOUS

 

Section 12.1     Stockholder Representative.

 

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(a)     By approving this Agreement and the transactions contemplated hereby or
by executing and delivering a Letter of Transmittal, each Company Stockholder
shall have irrevocably authorized and appointed Stockholder Representative as
such Person’s representative, exclusive agent and attorney-in-fact to act on
behalf of such Person with respect to this Agreement and the Escrow Agreement
and to take any and all actions and make any decisions required or permitted to
be taken by Stockholder Representative pursuant to this Agreement or the Escrow
Agreement, including the exercise of the power to:

 

(i)     give and receive notices and communications;

 

(ii)     authorize delivery to Parent of cash from the Purchase Price Adjustment
Escrow Fund (or, if necessary, the Indemnification Escrow Fund) in satisfaction
of any amounts owed to Parent pursuant to Section 3.11 or from the
Indemnification Escrow Fund in satisfaction of claims for indemnification made
by Parent pursuant to this Agreement;

 

(iii)     agree to, negotiate, enter into settlements and compromises of, and
comply with orders or otherwise handle any other matters described in Section
3.11;

 

(iv)     agree to, negotiate, enter into settlements and compromises of, and
comply with orders of courts with respect to claims for indemnification made by
Parent pursuant to this Agreement;

 

(v)     litigate, arbitrate, resolve, settle or compromise any claim for
indemnification pursuant to this Agreement;

 

(vi)     execute and deliver all documents necessary or desirable to carry out
the intent of this Agreement and any Ancillary Document (including the Escrow
Agreement);

 

(vii)     make all elections or decisions contemplated by this Agreement and any
Ancillary Document (including the Escrow Agreement);

 

(viii)     engage, employ or appoint any agents or representatives (including
attorneys, accountants and consultants) to assist Stockholder Representative in
complying with its duties and obligations; and

 

(ix)     take all actions necessary or appropriate in the good faith judgment of
Stockholder Representative for the accomplishment of the foregoing.

 

Notwithstanding the foregoing, the Stockholder Representative shall have no
obligation to act on behalf of the Company Stockholders except as expressly
provided herein, in the Escrow Agreement and in the Stockholder Representative
Engagement Agreement, and for purposes of clarity, there are no obligations of
the Stockholder Representative in any ancillary agreement, schedule, exhibit or
the Company Disclosure Letter. The Stockholder Representative shall be entitled
to: (i) rely upon the Consideration Spreadsheet, (ii) rely upon any signature
believed by it to be genuine, and (iii) reasonably assume that a signatory has
proper authorization to sign on behalf of the applicable Company Stockholder or
other party.

 

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(b)     Parent shall be entitled to deal exclusively with Stockholder
Representative on all matters relating to this Agreement (including, without
limitation, all matters related to indemnification) and shall be entitled to
rely conclusively (without further evidence of any kind whatsoever) on any
document executed or purported to be executed on behalf of any Company
Stockholder by Stockholder Representative, and on any other action taken or
purported to be taken on behalf of any Company Stockholder by Stockholder
Representative, as being fully binding upon such Person and such Person’s
successors. Notices or communications to or from Stockholder Representative
shall constitute notice to or from each of the Company Stockholders. Any
decision or action by Stockholder Representative hereunder, including any
agreement between Stockholder Representative and Parent relating to the defense,
payment or settlement of any claims for indemnification hereunder, shall
constitute a decision or action of all Company Stockholders and shall be final,
binding and conclusive upon each such Person. No Company Stockholder shall have
the right to object to, dissent from, protest or otherwise contest the same and
all defenses which may be available to any Company Stockholder to contest,
negate or disaffirm the action of the Stockholder Representative taken in good
faith under this Agreement, the Escrow Agreement or the Stockholder
Representative Engagement Agreement are waived. The provisions of this Section,
including the power of attorney granted hereby, and the powers, immunities and
rights to indemnification granted to the Stockholder Representative Group
hereunder: (i) are independent and severable, are irrevocable and coupled with
an interest and shall not be terminated by any act of any one or more Company
Stockholders, or by operation of Law, whether by death or other event and (ii)
shall survive the delivery of an assignment by any Company Stockholder of the
whole or any fraction of his, her or its interest in the Indemnification Escrow
Fund.

 

(c)     Stockholder Representative may resign at any time, and may be removed
for any reason or no reason by the vote or written consent of a majority in
interest of the Company Stockholders according to each Company Stockholder’s Pro
Rata Share (the “Majority Holders”); provided, however, in no event shall
Stockholder Representative resign or be removed without the Majority Holders
having first appointed a new Stockholder Representative who shall assume such
duties immediately upon the resignation or removal of Stockholder
Representative. In the event of the death, incapacity, resignation or removal of
Stockholder Representative, a new Stockholder Representative shall be appointed
by the vote or written consent of the Majority Holders. Notice of such vote or a
copy of the written consent appointing such new Stockholder Representative shall
be sent to Parent, such appointment to be effective upon the later of the date
indicated in such consent or the date such notice is received by Parent;
provided, that until such notice is received, Parent, Merger Subsidiary and the
Surviving Corporation shall be entitled to rely on the decisions and actions of
the prior Stockholder Representative as described in Section 12.1(a) above. The
immunities and rights to indemnification shall survive the resignation or
removal of the Stockholder Representative or any member of the Advisory Group
and the Closing and/or any termination of this Agreement and the Escrow
Agreement.

 

(d)     Certain Company Stockholders and Optionholders have entered into an
engagement agreement (the “Stockholder Representative Engagement Agreement”)
with the Stockholder Representative to provide direction to the Stockholder
Representative in connection with its services under this Agreement, the Escrow
Agreement and the Stockholder Representative Engagement Agreement (such Company
Stockholders and Optionholders, including their individual representatives,
collectively hereinafter referred to as the “Advisory Group”). Neither the
Stockholder Representative nor its members, managers, directors, officers,
contractors, agents and employees nor any member of the Advisory Group
(collectively, the “Stockholder Representative Group”) shall be liable to the
Company Stockholders or Optionholders for actions taken pursuant to this
Agreement, the Escrow Agreement or the Stockholder Representative Engagement
Agreement, except to the extent such actions shall have been determined by a
court of competent jurisdiction to have constituted gross negligence or involved
Fraud, intentional misconduct or bad faith (it being understood that any act
done or omitted pursuant to the advice of counsel, accountants and other
professionals and experts retained by Stockholder Representative shall be
conclusive evidence of good faith). The Company Stockholders shall severally and
not jointly (in accordance with their Pro Rata Shares), indemnify, defend and
hold harmless the Stockholder Representative Group from and against, compensate
it for, reimburse it for and pay any and all losses, liabilities, claims,
actions, damages, fees, fines, judgments, amounts paid in settlement and
expenses (including reasonable attorneys’ fees and disbursements, costs of other
skilled professionals and in connection with seeking recovery from insurers)
arising out of and in connection with its activities as Stockholder
Representative under this Agreement, the Escrow Agreement and the Stockholder
Representative Engagement Agreement (collectively, the “Representative Losses”),
in each case as such Representative Loss is suffered or incurred. The
Representative Losses shall be satisfied: (i) from the Stockholder
Representative Escrow Fund; and (ii) from any distribution of the
Indemnification Escrow Fund otherwise distributable to the Company Stockholders
at the time of distribution; (iii) to the extent the amount of the
Representative Losses exceeds amounts available to Stockholder Representative
under (i) and (ii), directly, from the Company Stockholders, severally and not
jointly (in accordance with their Pro Rata Shares). As soon as practicable after
the date on which the final obligation of Stockholder Representative under this
Agreement and the Escrow Agreement have been discharged or such other date as
Stockholder Representative deems appropriate, the Escrow Agent shall pay any
amounts remaining in the Stockholder Representative Escrow Fund to the Company
Stockholders in accordance with their Pro Rata Shares, as set forth in the
Escrow Agreement. The Company Stockholders acknowledge that the Stockholder
Representative shall not be required to expend or risk its own funds or
otherwise incur any financial liability in the exercise or performance of any of
its powers, rights, duties or privileges or pursuant to this Agreement, the
Escrow Agreement, the Stockholder Representative Engagement Agreement or the
transactions contemplated hereby or thereby. Furthermore, the Stockholder
Representative shall not be required to take any action unless the Stockholder
Representative has been provided with funds, security or indemnities which, in
its determination, are sufficient to protect the Stockholder Representative
against the costs, expenses and liabilities which may be incurred by the
Stockholder Representative in performing such actions.

 

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Section 12.2     Amendment. This Agreement may be amended by action taken by
Merger Subsidiary, the Company and Parent at any time before or after obtaining
the Company Stockholder Approval; provided, however, that after obtaining the
Company Stockholder Approval no amendment shall be made that under applicable
Law requires the approval of such Company Stockholders without the approval of
such Company Stockholders. This Agreement may not be amended except by an
instrument in writing signed on behalf of each of the Parties.

 

Section 12.3     Extension; Waiver. At any time prior to the Effective Time,
each Party may, to the extent legally allowed, (i) extend the time for the
performance of any of the obligations or other acts of the other Party hereto,
(ii) waive any inaccuracies in the representations and warranties contained
herein or in any document, certificate or writing delivered pursuant hereto by
the other Party hereto or (iii) subject to the proviso contained in Section
12.2, waive compliance with any of the agreements or conditions contained herein
by the other Party. Any agreement on the part of any Party to any such extension
or waiver shall be valid only if set forth in an instrument in writing signed on
behalf of such Party. The failure of any Party hereto to assert any of its
rights hereunder shall not constitute a waiver of such rights.

 

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Section 12.4     Entire Agreement; Assignment. This Agreement, including all
Schedules and Exhibits attached hereto, (i) constitutes the entire agreement
among the Parties with respect to the subject matter hereof and supersedes all
other prior agreements and understandings, both written and oral, among the
Parties or any of them with respect to the subject matter hereof and thereof,
and (ii) shall not be assigned by operation of law or otherwise prior to the
Effective Time.

 

Section 12.5     Notices. All notices, requests, claims, demands and other
communications hereunder shall be in writing and shall be given (and shall be
deemed to have been duly given upon receipt) by delivery in person, by overnight
delivery service from a national carrier or by registered or certified mail
(postage prepaid, return receipt requested) to the respective Parties as
follows; provided that with respect to notices delivered to the Stockholder
Representative, such notices must be delivered solely via email:

 

if to the Company:

 

Ethertronics, Inc.

5501 Oberlin Drive, Suite 100

San Diego, California 92121

Attention:      Chief Executive Officer and Chief Financial Officer

Telephone:     (858) 550-3820

 

with a copy to:

 

Gunderson Dettmer Stough Villeneuve Franklin & Hachigian, LLP

3570 Carmel Mountain Road, Suite 200

San Diego, California 92130

Attention:       John Tolpa

Telephone:      (858) 436-8086

 

If to the Stockholder Representative

 

Fortis Advisors LLC

Attention Notice Department

Email: notices@fortisrep.com

 

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if to Parent or Merger Subsidiary:

 

AVX Corporation

1 AVX Boulevard

Fountain Inn, South Carolina 29644

Attention:      Evan Slavitt, Senior Vice President,

                       General Counsel and Corporate Secretary

Telephone:     (864) 228-3417

 

with a copy to:

 

Troutman Sanders LLP

Troutman Sanders Building

1001 Haxall Point

Richmond, Virginia 23219

Attention:      Coburn R. Beck

Telephone:     (804) 697-1262

 

or to such other address as the person to whom notice is given may have
previously furnished to the others in writing in the manner set forth above.

 

Section 12.6     Governing Law; Consent to Jurisdiction; Arbitration.

 

(a)     This Agreement, and all claims or causes of action (whether at law, in
contract or in tort) that may be based upon, arise out of or relate to this
Agreement or the negotiation, execution or performance hereof, shall be governed
by and construed in accordance with the Laws of the State of Delaware, without
giving effect to any choice or conflict of law provision or rule that would
cause the application of the Laws of any jurisdiction other than the State of
Delaware. Each of the Parties (i) consents to submit itself to the personal
jurisdiction of any federal court located in the State of Delaware or any
Delaware state court sitting in Wilmington, Delaware in the event any dispute
arises out of this Agreement or any of the transactions contemplated by this
Agreement, and, in connection with any such matter, to service of process by
notice as otherwise provided herein, (ii) agrees that it will not attempt to
deny or defeat such personal jurisdiction by motion or other request for leave
from any such court and (iii) agrees that it will not bring any action relating
to this Agreement or any of the transactions contemplated by this Agreement in
any court other than a federal court sitting in the State of Delaware or a
Delaware state court.

 

(b)     Any controversy or claim arising out of or relating to this contract, or
the breach thereof, shall be settled by single-arbitrator arbitration
administered by the American Arbitration Association in accordance with its
Procedures for Large, Complex Commercial Disputes including the Optional Rules
for Emergency Measures of Protection, and judgment on the award rendered by the
arbitrator may be entered in any court having jurisdiction thereof. Unless
otherwise agreed to by the Parties, the arbitration shall be held in New Castle
County, Delaware and the substantive and procedural laws of Delaware shall
apply, except for any choice of law provisions. The arbitration shall be
conducted in English. Although the arbitrator(s) need not apply formal rules of
evidence, the arbitration will be guided by the Federal Rules of Evidence. The
arbitrator shall render an award together with a reasoned decision. The
arbitrator may award costs and attorney’s fees if the arbitrator determines that
the position of one Party was not substantially justified. The arbitrator may
not award punitive damages, nor may the arbitrator award multiple damages even
if permitted by applicable law. Any demand for arbitration must be made within
one year of discovery, or the claim will be deemed waived. This arbitration
provision and any award made pursuant to an arbitration convened pursuant to it
may be enforced in the United States District Court with jurisdiction over New
Castle County, Delaware, or, if such court lacks jurisdiction, then the state
courts of Delaware with jurisdiction over New Castle County.

 

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Section 12.7     Specific Performance. The Parties hereto agree that irreparable
damage would occur in the event any of the provisions of this Agreement were not
performed in accordance with the terms hereof and that the Parties shall be
entitled to specific performance of the terms hereof, in addition to any other
remedy at law or equity.

 

Section 12.8     Descriptive Headings. The descriptive headings herein are
inserted for convenience of reference only and are not intended to be part of or
to affect the meaning or interpretation of this Agreement.

 

Section 12.9     Parties in Interest. This Agreement shall be binding upon and
inure solely to the benefit of each Party, and except as provided in the
following sentence, nothing in this Agreement, express or implied, is intended
to or shall confer upon any other person any rights, benefits or remedies of any
nature whatsoever under or by reason of this Agreement.

 

Section 12.10     Execution of this Agreement. This Agreement may be executed in
two or more counterparts, each of which shall be deemed to be an original, but
all of which shall constitute one and the same agreement. The exchange of copies
of this Agreement and of signature pages by electronic transmission (including
by exchanging PDF copies) shall constitute effective execution and delivery of
this Agreement as to the Parties and may be used in lieu of the original
Agreement for all purposes.

 

Section 12.11     Severability. If any term or other provision of this Agreement
is invalid, illegal or incapable of being enforced by any rule of law or public
policy, all other conditions and provisions of this Agreement shall nevertheless
remain in full force and effect so long as the economic or legal substance of
the transactions contemplated hereby is not affected in any manner adverse to
any Party. Upon such determination that any term or other provision is invalid,
illegal or incapable of being enforced, the Parties hereto shall negotiate in
good faith to modify such term or provision so as to effect the original intent
of the Parties as closely as possible in an acceptable manner to the end that
the transactions contemplated hereby are fulfilled to the extent possible.

 

[SIGNATURE PAGE FOLLOWS]

 

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IN WITNESS WHEREOF, each of the Parties has caused this Agreement to be duly
executed on its behalf by its officer thereunto duly authorized, all as of the
day and year first above written.

 

 

AVX CORPORATION

 

 

 

By:                                                             
           Name:
           Title:

 

 

ARMSTRONG ALPERT, INC.

 

 

 

By:                                                              
           Name:
           Title:

 

 

ETHERTRONICS, INC.

 

 

 

By:                                                                
           Name:
           Title:

 

 

FORTIS ADVISORS LLC as the

Stockholder Representative

 

 

 

By:                                                                  
           Name: Richard Fink
           Title: CEO & Managing Director

 

 

 

 

 

 

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