Exhibit 10.67

 

ASSET PURCHASE AGREEMENT

 

dated as of April 25, 2008

 

Among

 

SANMINA-SCI USA, INC., SANMINA-SCI SYSTEMS SERVICES DE MEXICO S.A. DE C.V. and
SANMINA-SCI SYSTEMS DE MEXICO S.A. DE C.V. as Sellers

 

and

 

LENOVO (SINGAPORE) PTE. LTD and LENOVO CENTRO TECNOLOGICO, SdeRL DE CV, as Buyer

 

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ASSET PURCHASE AGREEMENT

 

This Asset Purchase Agreement is entered into as of April 25, 2008 by and among
SANMINA-SCI USA, INC., SANMINA-SCI SYSTEMS SERVICES DE MEXICO S.A. DE C.V. and
SANMINA-SCI SYSTEMS DE MEXICO S.A. DE C.V. (collectively, the “Sellers”), LENOVO
(SINGAPORE) PTE. LTD and LENOVO CENTRO TECNOLOGICO, SdeRL DE CV., or their
assigns (collectively the “Buyer”).  Buyer and Sellers shall be referred to
herein individually as a “Party” and collectively, as the “Parties”.

 

This Agreement contemplates a transaction in which the Buyer will purchase (or
lease with the option to purchase) the Acquired Assets, without assuming any of
the liabilities other than the Assumed Liabilities.

 

Capitalized terms used in this Agreement and not otherwise defined herein shall
have the meanings ascribed to them in ARTICLE IX.

 

In consideration of the representations, warranties and covenants herein
contained, the Parties agree as follows.

 

ARTICLE I

 

THE ASSET PURCHASE

 

1.1           PURCHASE AND SALE OF ASSETS.

 

(A)           UPON AND SUBJECT TO THE TERMS AND CONDITIONS OF THIS AGREEMENT FOR
THE CONSIDERATION SPECIFIED IN THIS ARTICLE I, BUYER SHALL PURCHASE FROM SELLERS
(OR LEASE FROM SELLERS WITH THE OPTION TO PURCHASE), AND SELLERS SHALL LEASE,
TRANSFER, CONVEY, ASSIGN AND DELIVER TO THE BUYER, AS OF THE CLOSING, ALL RIGHT,
TITLE AND INTEREST IN, TO AND UNDER THE ACQUIRED ASSETS.

 

(B)           NOTWITHSTANDING THE PROVISIONS OF SECTION 1.1(A), THE ACQUIRED
ASSETS SHALL NOT INCLUDE THE EXCLUDED ASSETS.

 

1.2           ASSUMPTION OF SELLERS’S LIABILITIES FROM BUYER.

 

(A)           UPON AND SUBJECT TO THE TERMS AND CONDITIONS OF THIS AGREEMENT,
THE ONLY LIABILITY THAT BUYER SHALL ASSUME AND BECOME RESPONSIBLE FOR, FROM AND
AFTER THE CLOSING ARE THE ASSUMED LIABILITIES.

 

(B)           BUYER SHALL NOT ASSUME OR BECOME RESPONSIBLE FOR, AND THE SELLERS
SHALL REMAIN LIABLE FOR, ALL THE OTHER LIABILITIES THAT THE SELLERS OR ITS
AFFILIATES HAVE WITH RESPECT TO THEIR HANDLING OF THE ACQUIRED BUSINESS.

 

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1.3           PURCHASE PRICE.

 

(A)           THE PURCHASE PRICE TO BE PAID TO THE SELLERS BY THE BUYER FOR THE
ACQUIRED ASSETS SHALL BE [*] DOLLARS (US$[*]) (THE “BASE PURCHASE PRICE”) PLUS
THE INVENTORY VALUE, SUBJECT TO ADJUSTMENT PURSUANT TO SECTION 1.7 BELOW.

 

(B)           ON THE CLOSING DATE, BUYER SHALL PAY SELLER THE FOLLOWING
(“INITIAL PURCHASE PRICE”):

 

(I)            THE BASE PURCHASE PRICE; AND

 

(II)           THE ESTIMATED INVENTORY VALUE.

 

1.4           THE CLOSING.

 

(A)           THE CLOSING SHALL TAKE PLACE AT MONTEREY, MEXICO, COMMENCING AT
9:00 A.M. LOCAL TIME ON THE CLOSING DATE.  ALL TRANSACTIONS AT THE CLOSING SHALL
BE DEEMED TO TAKE PLACE SIMULTANEOUSLY EFFECTIVE AS OF THE EFFECTIVE TIME), AND
NO TRANSACTION SHALL BE DEEMED TO HAVE BEEN COMPLETED AND NO DOCUMENTS OR
CERTIFICATES SHALL BE DEEMED TO HAVE BEEN DELIVERED UNTIL ALL OTHER TRANSACTIONS
ARE COMPLETED AND ALL OTHER DOCUMENTS AND CERTIFICATES ARE DELIVERED.

 

(B)           AT THE CLOSING:

 

(I)            THE SELLERS SHALL DELIVER TO THE BUYER THE VARIOUS CERTIFICATES,
INSTRUMENTS AND DOCUMENTS REFERRED TO IN SECTION 5.2;

 

(II)           THE BUYER SHALL DELIVER TO THE SELLERS THE VARIOUS CERTIFICATES,
INSTRUMENTS AND DOCUMENTS REFERRED TO IN SECTION 5.3;

 

(III)          THE SELLERS SHALL EXECUTE AND DELIVER TO THE BUYER THE
CORRESPONDING INVOICES IN SUBSTANTIALLY THE FORM ATTACHED HERETO AS EXHIBITS A-1
AND A-2 AND SUCH OTHER INSTRUMENTS OF CONVEYANCE AS THE BUYER MAY REASONABLY
REQUEST IN ORDER TO EFFECT THE SALE, TRANSFER,  CONVEYANCE AND ASSIGNMENT TO THE
BUYER OF VALID OWNERSHIP/LESSORSHIP OF THE ACQUIRED ASSETS;

 

(IV)          BUYER SHALL EXECUTE AND DELIVER TO SELLERS AN INSTRUMENT OF
ASSUMPTION IN SUBSTANTIALLY THE FORM ATTACHED HERETO AS EXHIBIT B, AND SUCH
OTHER INSTRUMENTS AS THE SELLERS MAY REASONABLY REQUEST IN ORDER TO EFFECT THE
ASSUMPTION BY THE BUYER OF THE ASSUMED LIABILITIES;

 

(V)           THE BUYER SHALL PAY, BY WIRE TRANSFER OR OTHER DELIVERY OF
IMMEDIATELY AVAILABLE FUNDS TO AN ACCOUNT DESIGNATED BY SELLERS, THE INITIAL
PURCHASE PRICE AS SET FORTH IN SECTION 1.3(B);

 

(VI)          SELLERS SHALL DELIVER TO THE BUYER, OR OTHERWISE PUT THE BUYER IN
POSSESSION AND CONTROL OF, ALL OF THE ACQUIRED ASSETS OF A TANGIBLE NATURE;

 

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* INFORMATION OMITTED PURSUANT TO A REQUEST FOR CONFIDENTIAL TREATMENT AND FILED
SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION.

 

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(VII)         THE BUYER AND THE SELLERS SHALL EXECUTE AND DELIVER A MODIFICATION
TO THAT CERTAIN CONTRACT BY AND BETWEEN THE PARTIES OR THEIR AFFILIATES PURSUANT
TO WHICH SELLERS SELLS AND BUYER PURCHASES CERTAIN PRODUCTS MANUFACTURED BY
SELLERS (THE “MANUFACTURING AGREEMENT”); AND

 

(VIII)        THE BUYER AND THE SELLERS SHALL EXECUTE AND DELIVER CROSS-RECEIPTS
EVIDENCING THE TRANSACTIONS REFERRED TO ABOVE.

 

1.5           ALLOCATION.  THE BUYER AND THE SELLERS AGREE TO ALLOCATE THE
PURCHASE PRICE (AND ALL OTHER CAPITALIZABLE COSTS) AMONG THE ACQUIRED ASSETS FOR
ALL PURPOSES (INCLUDING FINANCIAL ACCOUNTING AND TAX PURPOSES) IN ACCORDANCE
WITH THE ALLOCATION SCHEDULE ATTACHED HERETO AS SCHEDULE 1.5

 

1.6           FURTHER ASSURANCES.  AT ANY TIME AND FROM TIME TO TIME AFTER THE
CLOSING, AT THE REQUEST OF THE BUYER AND WITHOUT FURTHER CONSIDERATION, THE
SELLERS SHALL EXECUTE AND DELIVER SUCH OTHER INSTRUMENTS OF SALE, TRANSFER,
CONVEYANCE AND ASSIGNMENT AND TAKE SUCH ACTIONS AS THE BUYER MAY REASONABLY
REQUEST TO MORE EFFECTIVELY TRANSFER, CONVEY AND ASSIGN TO THE BUYER, AND TO
CONFIRM THE BUYER’S RIGHTS TO, TITLE IN AND OWNERSHIP OF, THE ACQUIRED ASSETS
(OTHER THAN TO THE FIXED ASSETS, WHICH ARE LEASED) AND TO PLACE THE BUYER IN
ACTUAL POSSESSION AND OPERATING CONTROL THEREOF AND TO ENSURE THAT THE ACQUIRED
BUSINESS CONTINUES TO OPERATE AS A GOING CONCERN AND WITHOUT INTERRUPTION.

 

1.7           INVENTORY VALUATION AND PAYMENT.

 

(A)           ON OR BEFORE APRIL 30, 2008, SELLERS SHALL PREPARE FOR BUYER ITS
STANDARD PACKAGE (THE “FINAL EXCESS PACKAGE”) SETTING FORTH THE INVENTORY ON
HAND AS OF MARCH 31, 2008 WHICH SELLERS BELIEVES IS EXCESS AND/OR OBSOLETE AND
FOR WHICH SELLERS BELIEVES BUYER IS LIABLE IN ACCORDANCE WITH THE MANUFACTURING
SERVICES AGREEMENT.  ON OR BEFORE MAY 15, 2008, BUYER SHALL ADVISE SELLERS OF
ANY ITEM IN THE PACKAGE FOR WHICH IT DISPUTES LIABILITY.  ANY ITEM WHICH HAS NOT
BEEN DISPUTED BY BUYER SHALL BE CONCLUSIVELY PRESUMED TO HAVE BEEN PURCHASED IN
ACCORDANCE WITH THE MANUFACTURING SERVICES AGREEMENT, AND BUYER SHALL BE
REQUIRED TO PAY FOR SUCH ITEMS.  THE PARTIES SHALL USE THEIR RESPECTIVE BEST
EFFORTS TO RESOLVE ANY DISPUTE ON OR BEFORE THE CLOSING.  IN THE EVENT EITHER
PARTY BELIEVES THE DISPUTE TO BE MATERIAL, IT SHALL HAVE THE RIGHT TO POSTPONE
CLOSING UNTIL THE DISPUTE IS RESOLVED.

 

(B)           COMMENCING ON APRIL 5, 2008, SELLERS SHALL PROVIDE BUYER WITH
PERIODIC INVENTORY LISTINGS, TOGETHER WITH A GOOD FAITH ESTIMATED INVENTORY
VALUE.  THE PURPOSE IS SO THAT BUYER CAN BECOME COMFORTABLE WITH SELLERS’S
FORMAT AND CONTENTS OF THE INVENTORY LISTING.  BUYER SHALL REVIEW THE INVENTORY
LISTING, AND ADVISE SELLERS IN THE EVENT IT QUESTIONS THE CALCULATIONS SET FORTH
THEREIN.  ON OR BEFORE MAY 15, 2008, BUYER SHALL ADVISE SELLERS WHETHER IT HAS
ANY MATERIAL CONCERNS AS TO ANY INVENTORY LISTING AND/OR ESTIMATED INVENTORY
VALUE.  THE PARTIES ACKNOWLEDGE THAT THE CONTENTS OF THESE ITEMS WILL VARY
WEEKLY AS INVENTORY IS PROCURED AND PRODUCT IS SHIPPED.  HOWEVER, BUYER SHALL BE
REQUIRED TO REVIEW THESE DOCUMENTS AND ADVISE SELLERS OF ANY MATERIAL ISSUES.

 

(C)           NOT LATER THAN TEN DAYS PRIOR TO THE CLOSING DATE, THE SELLERS
SHALL PREPARE AN INVENTORY LISTING, TOGETHER WITH A GOOD FAITH ESTIMATED
INVENTORY VALUE AS OF THE DATE ON

 

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WHICH IT IS PREPARED, WHICH SHALL PROVIDE SUFFICIENT DETAIL AS IS REASONABLY
NECESSARY TO CONFIRM THE CALCULATIONS THEREIN (THE “PRELIMINARY CLOSING
INVENTORY LISTING”).  AMONG OTHER THINGS, THE PRELIMINARY CLOSING INVENTORY
LISTING SHALL TAKE INTO CONSIDERATION ANY COMMENTS OR ADJUSTMENTS IDENTIFIED BY
BUYER TO SELLERS RESULTING FROM BUYER’S DUE DILIGENCE REVIEW OF THE INVENTORY
AND SELLERS’S INVENTORY RECORDS AS WELL AS BUYER’S REVIEW OF THE PREVIOUS
INVENTORY LISTINGS. IN ORDER TO PREPARE THE INVENTORY LISTING SELLERS SHALL HAVE
TAKEN INTO CONSIDERATION THE FACT THAT INVENTORY MEANS ALL THE MATERIALS
PRIMARILY USED OR HELD FOR USE BY SELLERS’S MONTERREY BUSINESS CONSISTENT WITH
PAST PRACTICE, EXCEPTING THOSE CREATED BY SELLERS’S FAILURE TO EXECUTE ITS
RESPONSIBILITIES AND INCLUDING LIABILITIES FOR VMI, OPEN PURCHASE ORDERS AND
OTHER SIMILAR ITEMS, AS NEEDED TO SUPPORT THE ADEQUATE ONGOING OPERATIONS OF THE
ACQUIRED BUSINESS.

 

(D)           IMMEDIATELY PRIOR TO THE CLOSING, BUYER SHALL COMPLETE A PHYSICAL
INVENTORY REVIEW OF THE INVENTORY TO ITS REASONABLE SATISFACTION (THE “BUYER’S
PHYSICAL INVENTORY REVIEW”), AND SHALL UPDATE THE PRELIMINARY CLOSING INVENTORY
LISTING (THE “UPDATED INVENTORY LISTING”) AND PREPARE A CALCULATION OF THE
INVENTORY VALUE TO REFLECT THE RESULTS OF THE BUYER’S PHYSICAL INVENTORY
REVIEW.  BUYER SHALL PROVIDE A COPY OF THE UPDATED INVENTORY LISTING TO
SELLERS.  BUYER ACKNOWLEDGES THAT THE QUANTITIES OF INVENTORY SET FORTH IN THE
PRELIMINARY CLOSING INVENTORY LIST WILL DIFFER FROM THE QUANTITIES OF INVENTORY
COUNTED DURING BUYER’S PHYSICAL INVENTORY REVIEW (E.G., BECAUSE OF RECEIPTS AND
SHIPMENTS).  BUYER SHALL HAVE THE OBLIGATION TO PURCHASE ALL INVENTORY AT THE
FACILITY OTHER THAN (I) INVENTORY WHICH IS DAMAGED OR OTHERWISE NOT OF SALEABLE
QUALITY OR (II) INVENTORY WHICH WAS NOT PROCURED IN ACCORDANCE WITH THE
AGREEMENT; (III) INVENTORY WHICH IS NOT USED ON BUYER PROGRAMS.  BUYER SHALL NOT
HAVE THE RIGHT TO REFUSE TO PAY FOR ANY INVENTORY CONTAINED IN THE FINAL EXCESS
PACKAGE UNLESS BUYER DISPUTED THE PROCUREMENT OF SUCH INVENTORY UNDER
SECTION 1.7(A).

 

(E)           UPON COMPLETION OF THE BUYER’S PHYSICAL INVENTORY REVIEW AND
RECEIPT OF BUYER’S UPDATED INVENTORY LISTING, THE PARTIES SHALL, TO THE EXTENT
POSSIBLE, AGREE ON A REVISED PRELIMINARY ESTIMATED INVENTORY VALUE AND, IF THE
PARTIES SO AGREE, THE PRELIMINARY ESTIMATED INVENTORY VALUE SHALL BE REVISED IN
THE EVENT THE PARTIES DO NOT SO AGREE, THE PRELIMINARY ESTIMATED INVENTORY VALUE
SHALL BE THE TOTAL VALUE OF THE INVENTORY ON HAND AT THE FACILITY AS OF MAY 31,
2008 AS SET FORTH IN SELLER’S DATABASE, AND THE PARTIES SHALL RESOLVE THE
DIFFERENCE IN ACCORDANCE WITH SECTION 1.7(F).

 

(F)            IN THE EVENT EITHER PARTY BELIEVES THAT THE PRELIMINARY ESTIMATED
INVENTORY VALUE IS DIFFERENT FROM THE INVENTORY FOR WHICH BUYER IS RESPONSIBLE
UNDER THE MANUFACTURING SERVICES AGREEMENT, SUCH PARTY SHALL ADVISE THE OTHER
PARTY WITHIN 30 DAYS AFTER THE CLOSING DATE.  THE PARTIES SHALL WORK TOGETHER IN
GOOD FAITH TO RESOLVE THE DISPUTE WITHIN 30 DAYS, FAILING WHICH THE DISPUTE
SHALL BE DECIDED THROUGH ARBITRATION IN ACCORDANCE WITH SECTION 7.3(B)(IV).   IN
THE EVENT THE PARTIES ARE ABLE TO RESOLVE THE DISPUTE THEMSELVES, THEY SHALL
JOINTLY PREPARE AN INVENTORY LISTING AS OF THE CLOSING DATE (THE “CLOSING
INVENTORY LISTING”) WHICH SETS FORTH THE AGREED UPON INVENTORY VALUE (THE “FINAL
CLOSING INVENTORY VALUE”).  IN THE EVENT THE PARTIES FAIL TO AGREE, THE DECISION
OF THE ARBITRATOR SHALL BECOME THE CLOSING INVENTORY LISTING AND FINAL CLOSING
INVENTORY VALUE.

 

(G)           IN THE EVENT THAT THE PRELIMINARY ESTIMATED INVENTORY VALUE
EXCEEDS THE FINAL CLOSING INVENTORY VALUE, THEN, WITHIN 3 BUSINESS DAYS, SELLERS
SHALL PAY THE DIFFERENCE TO

 

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BUYER BY WIRE TRANSFER OF IMMEDIATELY AVAILABLE FUNDS TO SUCH ACCOUNT AS BUYER
MAY REASONABLY DIRECT BY WRITTEN NOTICE DELIVERED TO SELLERS.

 

(H)           IN THE EVENT THAT THE FINAL CLOSING INVENTORY VALUE EXCEEDS THE
PRELIMINARY ESTIMATED INVENTORY VALUE THEN, WITHIN 3 BUSINESS DAYS, BUYER SHALL
PAY THE DIFFERENCE TO SELLERS BY WIRE TRANSFER OF IMMEDIATELY AVAILABLE FUNDS TO
SUCH ACCOUNT AS SELLERS MAY REASONABLY DIRECT BY WRITTEN NOTICE DELIVERED TO
BUYER.

 

1.8           SINGAPORE EXPORT.   FOR THE AVOIDANCE OF DOUBT, ALL INVENTORY AND
PARTS NEED TO BE VIRTUALLY EXPORTED TO BUYER ON THE CLOSING DATE IN ACCORDANCE
WITH ALL IMMEX AND APPLICABLE CUSTOMS REGULATIONS.

 

ARTICLE II

 

REPRESENTATIONS AND WARRANTIES OF THE SELLERS

 

The Sellers hereby represents and warrants to the Buyer that, except as set
forth in the Disclosure Schedule, the statements contained in this ARTICLE II
are true and correct as of the date of this Agreement and will be true and
correct as of the Closing Date as though made as of the Closing Date, except to
the extent such representations and warranties are specifically made as of a
particular date (in which case such representations and warranties will be true
and correct as of such date).  The Disclosure Schedule shall be arranged in
sections and subsections corresponding to the numbered and lettered sections and
subsections contained in this ARTICLE II.  The disclosures in any section or
subsection of the Disclosure Schedule shall qualify other sections and
subsections in this ARTICLE II only to the extent it is clear from a reading of
the disclosure that such disclosure is applicable to such other sections and
subsections.

 

2.1           ORGANIZATION, QUALIFICATION AND CORPORATE POWER.  SANMINA-SCI
USA, INC. IS A CORPORATION DULY ORGANIZED, VALIDLY EXISTING AND IN GOOD STANDING
UNDER THE LAWS OF DELAWARE.  SANMINA-SCI SYSTEMS DE MEXICO, S.A. DE C.V. A
CORPORATION DULY ORGANIZED, VALIDLY EXISTING AND IN GOOD STANDING UNDER THE LAWS
OF MEXICO.  SANMINA-SCI SYSTEMS SERVICES DE MEXICO, S.A. DE C.V. IS A
CORPORATION DULY ORGANIZED, VALIDLY EXISTING AND IN GOOD STANDING UNDER THE LAWS
OF MEXICO.  EACH SELLER IS QUALIFIED TO CONDUCT BUSINESS AND IS IN GOOD STANDING
UNDER THE LAWS OF THE FOREGOING JURISDICTIONS.  EACH SELLER HAS ALL REQUISITE
CORPORATE POWER AND AUTHORITY TO CARRY ON THE BUSINESSES IN WHICH IT IS ENGAGED
AND TO OWN AND USE THE PROPERTIES OWNED AND USED BY IT.  EACH SELLER HAS
FURNISHED, OR PRIOR TO THE CLOSING WILL FURNISH, TO THE BUYER COMPLETE AND
ACCURATE COPIES OF ITS CERTIFICATE OF INCORPORATION AND BYLAWS.  EACH SELLER IS
NOT IN DEFAULT UNDER OR IN VIOLATION OF ANY PROVISION OF ITS CERTIFICATE OF
INCORPORATION OR BYLAWS.

 

2.2           AUTHORIZATION OF TRANSACTION.  EACH SELLER HAS ALL REQUISITE POWER
AND AUTHORITY TO EXECUTE AND DELIVER THIS AGREEMENT AND THE ANCILLARY AGREEMENTS
AND TO PERFORM ITS OBLIGATIONS HEREUNDER AND THEREUNDER.  THE EXECUTION AND
DELIVERY BY EACH SELLER OF THIS AGREEMENT AND THE PERFORMANCE BY EACH SELLER OF
THIS AGREEMENT AND THE ANCILLARY AGREEMENTS AND THE CONSUMMATION BY EACH SELLER
OF THE TRANSACTIONS CONTEMPLATED HEREBY AND THEREBY HAVE BEEN DULY AND VALIDLY
AUTHORIZED BY ALL NECESSARY CORPORATE ACTION ON THE PART OF SUCH SELLER.  THIS
AGREEMENT HAS BEEN DULY AND VALIDLY EXECUTED AND DELIVERED BY EACH SELLER AND
CONSTITUTES, AND EACH OF THE ANCILLARY AGREEMENTS, UPON ITS EXECUTION AND
DELIVERY BY SUCH SELLER, WILL CONSTITUTE,

 

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A VALID AND BINDING OBLIGATION OF SUCH SELLER, ENFORCEABLE AGAINST THE SELLER IN
ACCORDANCE WITH ITS TERMS EXCEPT (I) AS LIMITED BY APPLICABLE BANKRUPTCY,
INSOLVENCY, REORGANIZATION, MORATORIUM, FRAUDULENT CONVEYANCE, AND OTHER LAWS OF
GENERAL APPLICATION AFFECTING ENFORCEMENT OF CREDITORS’ RIGHTS GENERALLY, OR
(II) AS LIMITED BY LAWS RELATING TO THE AVAILABILITY OF SPECIFIC PERFORMANCE,
INJUNCTIVE RELIEF, OR OTHER EQUITABLE REMEDIES.

 

2.3           NONCONTRAVENTION.  EXCEPT AS SET FORTH IN SECTION 2.3 OF THE
DISCLOSURE SCHEDULE, NEITHER THE EXECUTION AND DELIVERY BY THE SELLERS OF THIS
AGREEMENT OR THE ANCILLARY AGREEMENTS, NOR THE CONSUMMATION BY THE SELLERS OF
THE TRANSACTIONS CONTEMPLATED HEREBY OR THEREBY, WILL (A) CONFLICT WITH OR
VIOLATE ANY PROVISION OF THE CERTIFICATE OF INCORPORATION OR BYLAWS OF THE
SELLERS, (B) REQUIRE ON THE PART OF THE SELLERS ANY NOTICE TO OR FILING WITH, OR
ANY PERMIT, AUTHORIZATION, CONSENT OR APPROVAL OF, ANY GOVERNMENTAL ENTITY,
(C) CONFLICT WITH, RESULT IN A BREACH OF, CONSTITUTE (WITH OR WITHOUT DUE NOTICE
OR LAPSE OF TIME OR BOTH) A DEFAULT UNDER, RESULT IN THE ACCELERATION OF
OBLIGATIONS UNDER, CREATE IN ANY PARTY THE RIGHT TO TERMINATE, MODIFY OR CANCEL,
OR REQUIRE ANY NOTICE, CONSENT OR WAIVER UNDER, ANY CONTRACT OR INSTRUMENT TO
WHICH ANY SELLER IS A PARTY OR BY WHICH ANY SELLER IS BOUND OR TO WHICH ANY OF
ITS RESPECTIVE ASSETS IS SUBJECT, (D) RESULT IN THE IMPOSITION OF ANY SECURITY
INTEREST UPON ANY ASSETS OF THE SELLERS OR (E) VIOLATE ANY ORDER, WRIT,
INJUNCTION, DECREE, STATUTE, RULE OR REGULATION APPLICABLE TO THE SELLERS OR ANY
OF THEIR RESPECTIVE PROPERTIES OR ASSETS.

 

2.4           OWNERSHIP.  AS OF THE CLOSING DATE, OTHER THAN SELLERS AND THEIR
STOCKHOLDERS, SOLELY THROUGH THEIR INTEREST IN THE SELLERS, NO ENTITY OR PERSON
HAS ANY RIGHT, TITLE OR INTEREST IN THE FIXED ASSETS AND INVENTORY.

 

2.5           FINANCIAL STATEMENTS.  THE SELLERS HAVE PROVIDED TO THE BUYER THE
FINANCIAL STATEMENTS RELATING TO THE ACQUIRED BUSINESS.  THE FINANCIAL
STATEMENTS HAVE BEEN PREPARED IN ACCORDANCE WITH GAAP APPLIED ON A CONSISTENT
BASIS THROUGHOUT THE PERIODS COVERED THEREBY, FAIRLY PRESENT THE CONSOLIDATED
FINANCIAL CONDITION, RESULTS OF OPERATIONS AND CASH FLOWS OF THE SELLERS AS OF
THE RESPECTIVE DATES THEREOF AND FOR THE PERIODS REFERRED TO THEREIN AND ARE
CONSISTENT WITH THE BOOKS AND RECORDS OF THE SELLERS; PROVIDED, HOWEVER, THAT
THE FINANCIAL STATEMENTS ARE SUBJECT TO NORMAL RECURRING YEAR-END ADJUSTMENTS
(WHICH WILL NOT BE MATERIAL) AND DO NOT INCLUDE FOOTNOTES.

 

2.6           ABSENCE OF CERTAIN CHANGES.  EXCEPT AS SET FORTH IN SECTION 2.6 OF
THE DISCLOSURE SCHEDULE, SINCE THE MOST RECENT BALANCE SHEET DATE, (A) THERE HAS
OCCURRED NO EVENT OR DEVELOPMENT THAT, INDIVIDUALLY OR IN THE AGGREGATE, HAS
HAD, OR COULD REASONABLY BE EXPECTED TO HAVE IN THE FUTURE, A MATERIAL ADVERSE
EFFECT, AND (B) THE SELLERS HAVE NOT TAKEN ANY OF THE ACTIONS SET FORTH IN ANY
OF THE SUBSECTIONS OF SECTION 4.4.  SINCE DECEMBER 29, 2007, THE SELLERS HAVE
NOT PAID ANY OBLIGATION OR LIABILITY RELATING, DIRECTLY OR INDIRECTLY, TO THE
ACQUIRED BUSINESS OTHER THAN IN THE ORDINARY COURSE OF BUSINESS.

 

2.7           UNDISCLOSED LIABILITIES.  TO SELLERS’ KNOWLEDGE, THE SELLERS HAVE
NO LIABILITIES (WHETHER ABSOLUTE OR CONTINGENT, WHETHER LIQUIDATED OR
UNLIQUIDATED AND WHETHER DUE OR TO BECOME DUE) RELATING, DIRECTLY OR INDIRECTLY,
TO THE ACQUIRED BUSINESS WHICH LIABILITY WOULD MATERIALLY AFFECT THE FINANCIAL
STATEMENTS, EXCEPT FOR (A) LIABILITIES SHOWN ON THE MOST RECENT

 

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BALANCE SHEET AND (B) LIABILITIES WHICH HAVE ARISEN SINCE THE MOST RECENT
BALANCE SHEET DATE IN THE ORDINARY COURSE OF BUSINESS.

 

2.8           TAX MATTERS.  EACH SELLER HAS FILED ON A TIMELY BASIS ALL TAX
RETURNS RELATING TO THE ACQUIRED BUSINESS THAT IT WAS REQUIRED TO FILE, AND ALL
SUCH TAX RETURNS WERE COMPLETE AND ACCURATE IN ALL MATERIAL RESPECTS.  EACH
SELLER HAS PAID ON A TIMELY BASIS ALL TAXES THAT WERE DUE AND PAYABLE RELATING
TO THE ACQUIRED BUSINESS.  OTHER THAN TAXES NOT YET DUE AND OWING, THE ACQUIRED
ASSETS ARE NOT ENCUMBERED BY ANY LIENS ARISING OUT OF ANY UNPAID TAXES.

 

2.9           OWNERSHIP AND CONDITION OF ASSETS.

 

(A)           THE SELLERS ARE THE TRUE AND LAWFUL OWNER, AND HAS GOOD TITLE TO,
ALL OF THE ACQUIRED ASSETS, FREE AND CLEAR OF ALL SECURITY INTERESTS, EXCEPT AS
SET FORTH IN SECTION 2.9(A) OF THE DISCLOSURE SCHEDULE. UPON EXECUTION AND
DELIVERY BY THE SELLERS TO THE BUYER OF THE INSTRUMENTS OF CONVEYANCE REFERRED
TO IN SECTION 1.4(B)(III), THE BUYER WILL BECOME THE TRUE AND LAWFUL LESSOR OF,
THE FIXED ASSETS, AND, IN THE EVENT BUYER EXERCISES THE OPTION SET FORTH IN
SECTION 6.10, BUYER WILL RECEIVE GOOD TITLE TO, THE FIXED ASSETS, FREE AND CLEAR
OF ALL SECURITY INTERESTS OTHER THAN THOSE SET FORTH IN SECTION 2.9(A) OF THE
DISCLOSURE SCHEDULE.

 

(B)           EXCEPT AS SET FORTH IN THE DISCLOSURE SCHEDULE, THE ACQUIRED
ASSETS CONSTITUTE ALL OF THE ASSETS WHICH ARE SUFFICIENT FOR THE CONDUCT OF THE
ACQUIRED BUSINESS AS PRESENTLY CONDUCTED BY SELLERS.  EACH TANGIBLE ACQUIRED
ASSET IS FREE FROM MATERIAL DEFECTS, HAS BEEN MAINTAINED IN ACCORDANCE WITH
NORMAL INDUSTRY PRACTICE, IS IN GOOD OPERATING CONDITION AND REPAIR (SUBJECT TO
NORMAL WEAR AND TEAR) AND IS SUITABLE FOR THE PURPOSES FOR WHICH IT PRESENTLY IS
USED.

 

(C)           SECTION 2.9(C) OF THE DISCLOSURE SCHEDULE LISTS INDIVIDUALLY
(I) ALL FIXED ASSETS), INDICATING THE COST, ACCUMULATED BOOK DEPRECIATION (IF
ANY) AND THE NET BOOK VALUE OF EACH SUCH FIXED ASSET AS OF THE MOST RECENT
BALANCE SHEET DATE

 

(D)           EACH ITEM OF EQUIPMENT, MOTOR VEHICLE AND OTHER ASSET THAT IS
BEING LEASED TO THE BUYER AS PART OF THE ACQUIRED ASSETS AND THAT THE SELLERS
HAS POSSESSION OF PURSUANT TO A LEASE AGREEMENT OR OTHER CONTRACTUAL ARRANGEMENT
IS IN SUCH CONDITION THAT, UPON ITS RETURN TO ITS LESSOR OR OWNER UNDER THE
APPLICABLE LEASE OR CONTRACT, THE OBLIGATIONS OF THE SELLERS TO SUCH LESSOR OR
OWNER WILL HAVE BEEN DISCHARGED IN FULL.

 

2.10         REAL PROPERTY.  THE REPRESENTATIONS AND WARRANTIES SET FORTH IN THE
FACILITY LEASE AGREEMENT ARE HEREBY INCORPORATED BY REFERENCE.

 

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2.11         INTELLECTUAL PROPERTY.

 

(A)           SECTION 2.11 OF THE DISCLOSURE SCHEDULE IDENTIFIES EACH ITEM
INTELLECTUAL PROPERTY THAT IS OWNED BY A PARTY OTHER THAN THE SELLERS WHICH ARE
NECESSARY TO RUN THE ACQUIRED BUSINESS AS CURRENTLY BEING CONDUCTED (EXCLUDING
OFF-THE-SHELF SOFTWARE PROGRAMS LICENSED BY THE SELLER PURSUANT TO “SHRINK WRAP”
LICENSES PURSUANT TO “SHRINK WRAP” LICENSES).  EXCEPT AS SET FORTH IN
SECTION 2.11 OF THE DISCLOSURE SCHEDULE, TO SELLERS’S KNOWLEDGE, THE SELLERS
OWNS OR HAS THE RIGHT TO USE ALL INTELLECTUAL PROPERTY NECESSARY OR OTHERWISE
USED TO OPERATE THE INTERNAL SYSTEMS AS CURRENTLY USED TODAY.  EXCEPT AS SET
FORTH IN SECTION 2.11 OF THE DISCLOSURE SCHEDULE, UPON EXECUTION AND DELIVERY BY
THE SELLERS TO THE BUYER OF THIS AGREEMENT AND ALL AGREEMENTS AND INSTRUMENTS
DELIVERED PURSUANT HERETO (INCLUDING THE TRANSITIONAL SERVICES AGREEMENT), EACH
ITEM OF INTELLECTUAL PROPERTY USED BY THE SELLERS IN CONNECTION WITH THE
ACQUIRED BUSINESS WILL BE AVAILABLE FOR USE BY THE BUYER IMMEDIATELY FOLLOWING
THE CLOSING ON SUBSTANTIALLY IDENTICAL TERMS AND CONDITIONS AS IT WAS
IMMEDIATELY PRIOR TO THE CLOSING, EITHER DIRECTLY OR INDIRECTLY.

 

(B)           TO SELLERS’S KNOWLEDGE, EXCEPT AS SET FORTH IN SECTION 2.11 OF THE
SELLERS DISCLOSURE SCHEDULE, NONE OF THE INTERNAL SYSTEMS, OR THE USE THEREOF,
INFRINGES OR VIOLATES, OR CONSTITUTES A MISAPPROPRIATION OF, ANY INTELLECTUAL
PROPERTY RIGHTS OF ANY PERSON OR ENTITY.  SECTION 2.11 OF THE DISCLOSURE
SCHEDULE LISTS ANY COMPLAINT, CLAIM OR NOTICE, OR WRITTEN THREAT THEREOF,
RECEIVED BY THE SELLERS ALLEGING ANY SUCH INFRINGEMENT, VIOLATION OR
MISAPPROPRIATION.  CONDUCTED (EXCLUDING OFF-THE-SHELF SOFTWARE PROGRAMS LICENSED
BY THE SELLERS

 

2.12         CONTRACTS.

 

(A)           SECTION 2.12 OF THE DISCLOSURE SCHEDULE SETS FORTH THE FOLLOWING
INFORMATION:

 

(I)            ALL LIST OF CURRENT COMPONENT VENDORS AND A LIST OF ANY
NEGOTIATED AGREEMENTS (EXCLUDING PURCHASE ORDER AND OTHER PREPRINTED AGREEMENTS)
WITH THOSE VENDORS WHICH RELATE TO THE ACQUIRED BUSINESS;

 

(II)           A LIST OF ANY AGREEMENTS WITH ANY LOCAL SERVICES PROVIDED TO THE
ACQUIRED BUSINESS (E.G., TRANSPORTATION, TEMPORARY AGENCIES, CAFETERIA, CAR AND
FORKLIFT LEASES), OTHER THAN ANY SUCH AGREEMENTS NEGOTIATED AT SELLERS’
“CORPORATE LEVEL”;

 

(III)          ANY AGREEMENT CONCERNING THE ESTABLISHMENT OR OPERATION OF A
PARTNERSHIP, JOINT VENTURE OR LIMITED LIABILITY COMPANY THAT TO THE BEST OF
SELLERS’S KNOWLEDGE MAY AFFECT OR IMPAIR BUYER FROM CONTINUING THE ACQUIRED
BUSINESS AS AN ADEQUATE GOING CONCERN;

 

(IV)          ANY AGREEMENT FOR THE DISPOSITION OF ANY SIGNIFICANT PORTION OF
THE ACQUIRED BUSINESS OR ANY SIGNIFICANT PART THERETO;

 

(V)           ANY EMPLOYMENT OR CONSULTING AGREEMENT RELATED TO THE ACQUIRED
BUSINESS;

 

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(VI)          ANY NONDISCLOSURE OR NONCOMPETE AGREEMENT WITH ANY VENDOR WHICH
RELATES TO THE ACQUIRED BUSINESS;

 

(VII)         A LIST OF ALL OPEN PURCHASE ORDERS RELATING TO THE ACQUIRED
BUSINESS

 

(B)           THE SELLERS HAVE DELIVERED TO THE BUYER A COMPLETE AND ACCURATE
COPY OF EACH AGREEMENT LISTED IN SECTION 2.12 OF THE DISCLOSURE SCHEDULE (OTHER
THAN ANY AGREEMENT TO WHICH BUYER IS ALREADY A PARTY).  UNLESS SET FORTH IN
SECTION 2.12(B) THE DISCLOSURE SCHEDULE, WITH RESPECT TO THE ASSUMED CONTRACTS:
(I) TO THE BEST OF SELLERS’ KNOWLEDGE, THE AGREEMENT IS LEGAL, VALID, BINDING
AND ENFORCEABLE AND IN FULL FORCE AND EFFECT; (II), THE AGREEMENT IS ASSIGNABLE
BY THE SELLERS TO THE BUYER; AND (III) NEITHER THE SELLERS NOR, TO THE BEST
KNOWLEDGE OF THE SELLERS, ANY OTHER PARTY, IS IN BREACH OR VIOLATION OF, OR
DEFAULT UNDER, ANY SUCH AGREEMENT, AND NO EVENT HAS OCCURRED, IS PENDING OR, TO
THE KNOWLEDGE OF THE SELLERS, IS THREATENED, WHICH, AFTER THE GIVING OF NOTICE,
WITH LAPSE OF TIME, OR OTHERWISE, WOULD CONSTITUTE A BREACH OR DEFAULT BY THE
SELLERS OR, TO THE KNOWLEDGE OF THE SELLERS, ANY OTHER PARTY UNDER SUCH
AGREEMENT.

 

2.13         LITIGATION.  EXCEPT AS SET FORTH IN SECTION 2.13 OF THE DISCLOSURE
SCHEDULE, THERE IS NO LEGAL PROCEEDING WHICH IS PENDING OR HAS BEEN THREATENED
IN WRITING AGAINST THE SELLERS THAT TO THE BEST OF SELLERS’ KNOWLEDGE MAY AFFECT
OR IMPAIR BUYER FROM CONTINUING THE ACQUIRED BUSINESS AS AN ADEQUATE GOING
CONCERN.  THERE ARE NO JUDGMENTS, ORDERS OR DECREES OUTSTANDING AGAINST THE
SELLERS WHICH RELATE TO THE ACQUIRED BUSINESS.

 

2.14         EMPLOYEES.

 

(A)           SECTION 2.14 OF THE DISCLOSURE SCHEDULE CONTAINS A LIST OF ALL
EMPLOYEES OF SELLERS WHO ARE EMPLOYED, EITHER FULL-TIME OR PART-TIME, IN
CONNECTION WITH THE ACQUIRED BUSINESS AS OF THE DATE ON WHICH THIS AGREEMENT IS
EXECUTED (THE “BUSINESS EMPLOYEES”), ALONG WITH SUCH EMPLOYEE’S POSITION, DATE
OF HIRE/SENIORITY, AND ANNUAL RATE OF COMPENSATION.  TO THE KNOWLEDGE OF THE
SELLERS, NO BUSINESS EMPLOYEE HAS ANY PLANS TO TERMINATE EMPLOYMENT WITH THE
SELLERS (OTHER THAN FOR THE PURPOSE OF ACCEPTING EMPLOYMENT WITH THE BUYER
FOLLOWING THE CLOSING) OR NOT TO ACCEPT EMPLOYMENT WITH THE BUYER.

 

(B)           SECTION 2.14 OF THE DISCLOSURE SCHEDULE SETS FORTH A COMPLETE AND
CORRECT LIST OF EVERY COLLECTIVE BARGAINING AGREEMENT COVERING THE BUSINESS
EMPLOYEES, AND ALL AMENDMENTS THERETO (INDIVIDUALLY A “UNION CONTRACT” AND,
COLLECTIVELY, THE “UNION CONTRACTS”).  SELLERS HAVE PROVIDED BUYER WITH TRUE,
COMPLETE AND CORRECT COPIES OF EACH UNION CONTRACT AND ALL AMENDMENTS AND
MODIFICATIONS THERETO.  THERE IS NO STRIKE, LABOR DISPUTE, SLOWDOWN, STOPPAGE OR
OTHER MATERIAL INTERFERENCE WITH OR IMPAIRMENT BY LABOR OF THE ACQUIRED BUSINESS
PENDING OR THREATENED AGAINST SELLERS.  EACH UNION CONTRACT SHALL BE AMENDED BY
SELLERS AT ITS OWN COST AND RESPONSIBILITY, AS OF CLOSING, ENABLING THE BUYER TO
EXECUTE AND REGISTER ITS OWN COLLECTIVE BARGAINING AGREEMENT. THE PARTIES
UNDERSTAND THAT IT WILL BE NECESSARY TO ASSIGN A NEW INTERIOR SPACE WITHIN THE
FACILITY AS THE ADDRESS OF SELLER FOR THE PURPOSES OF THE UNION CONTRACT, WHICH
WILL ONLY REPRESENT ITS OWN EMPLOYEES AND SHALL NOT REPRESENT EMPLOYEES RETAINED
BY BUYER.  IF IT IS NOT POSSIBLE TO ASSIGN AN INTERIOR SPACE WITHIN THE FACILITY
BY THE CLOSING, SELLERS WILL USE A PROVISIONAL ADDRESS OUTSIDE THE FACILITY
WHILE THE INTERIOR SPACE IS APPROVED BY THE LOCAL AUTHORITIES AS A NEW ADDRESS.
NEITHER THE SELLERS NOR, TO THE BEST KNOWLEDGE OF THE SELLERS, ANY OTHER PARTY,
IS IN BREACH OR VIOLATION OF, OR DEFAULT UNDER, ANY SUCH AGREEMENT, AND NO EVENT
HAS

 

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OCCURRED, IS PENDING OR, TO THE KNOWLEDGE OF THE SELLERS, IS THREATENED, WHICH,
AFTER THE GIVING OF NOTICE, WITH LAPSE OF TIME, OR OTHERWISE, WOULD CONSTITUTE A
BREACH OR DEFAULT BY THE SELLERS OR, TO THE KNOWLEDGE OF THE SELLERS, ANY OTHER
PARTY UNDER SUCH UNION CONTRACT.  BUYER SHALL BE THE ONLY PARTY RESPONSIBLE
BEFORE ITS OBLIGATIONS WITH THE LABOR UNION OR UNIONS WITH WHICH IT ENTERS INTO
AGREEMENTS ON THE UNDERSTANDING THAT SUCH UNION OR UNIONS WILL ONLY REPRESENT
EMPLOYEES OF BUYER AND UNDER NO CIRCUMSTANCES WILL THEY REPRESENT ANY EMPLOYEE
OF SELLERS.  UPON TERMINATION OF THE FACILITIES LEASE AGREEMENT, BUYER SHALL
TERMINATE ANY AGREEMENTS WITH UNIONS OR AMEND THEM TO EXCLUDE THE FACILITIES AND
PROVIDE A 30 DAY ADVANCE NOTICE TO SELLERS PRIOR TO VACATING THE PREMISES.

 

(C)           SECTION 2.14 OF THE DISCLOSURE SCHEDULE SETS FORTH A COMPLETE AND
CORRECT LIST OF EVERY AGREEMENT PURSUANT TO WHICH SELLERS OBTAINS THE SERVICES
OF CONTRACT LABOR FOR USE IN THE ACQUIRED BUSINESS AND ALL AMENDMENTS THERETO
(INDIVIDUALLY A “CONTRACT LABOR AGREEMENT” AND, COLLECTIVELY, THE “CONTRACT
LABOR AGREEMENTS”).  SELLERS HAVE PROVIDED BUYER WITH TRUE, COMPLETE AND CORRECT
COPIES OF EACH CONTRACT LABOR AGREEMENT AND ALL AMENDMENTS AND MODIFICATIONS
THERETO.  SECTION 2.14 OF THE DISCLOSURE SCHEDULE CONTAINS A LIST OF ALL WORKERS
PERFORMING SERVICES IN CONNECTION WITH THE ACQUIRED BUSINESS PURSUANT TO A
CONTRACT LABOR AGREEMENT (THE “CONTRACT WORKERS”), ALONG WITH SUCH CONTRACT
WORKER’S POSITION AND FEES PAYABLE WITH RESPECT TO HIS SERVICES.  EACH CONTRACT
LABOR AGREEMENT SHALL BE AMENDED WITH RESPECT TO THE FACILITY BY SELLERS AT ITS
OWN COST AND RESPONSIBILITIES, EFFECTIVE AS OF CLOSING, ENABLING BUYER TO
EXECUTE ITS OWN CONTRACT LABOR AGREEMENTS WITH THE AGENCY BUYER ELECTS. NEITHER
THE SELLERS NOR, TO THE BEST KNOWLEDGE OF THE SELLERS, ANY OTHER PARTY, IS IN
BREACH OR VIOLATION OF, OR DEFAULT UNDER, ANY SUCH AGREEMENT, AND NO EVENT HAS
OCCURRED, IS PENDING OR, TO THE KNOWLEDGE OF THE SELLERS, IS THREATENED, WHICH,
AFTER THE GIVING OF NOTICE, WITH LAPSE OF TIME, OR OTHERWISE, WOULD CONSTITUTE A
BREACH OR DEFAULT BY THE SELLERS OR, TO THE KNOWLEDGE OF THE SELLERS, ANY OTHER
PARTY UNDER SUCH CONTRACT LABOR AGREEMENT.

 

2.15         EMPLOYEE BENEFITS.

 

(A)           SECTION 2.15(A) OF THE DISCLOSURE SCHEDULE CONTAINS A COMPLETE AND
ACCURATE LIST OF ALL SELLER PLANS.  COMPLETE AND ACCURATE COPIES OF (I) ALL
SELLER PLANS WHICH HAVE BEEN REDUCED TO WRITING, (II) WRITTEN SUMMARIES OF ALL
UNWRITTEN SELLER PLANS, (III) ALL RELATED TRUST AGREEMENTS, INSURANCE CONTRACTS
AND SUMMARY PLAN DESCRIPTIONS, AND (IV) ALL REPORTS FILED WITH APPLICABLE
GOVERNMENTAL ENTITIES, AND (FOR ALL FUNDED PLANS) ALL PLAN FINANCIAL STATEMENTS
FOR THE LAST FIVE PLAN YEARS FOR EACH SELLER PLAN, HAVE BEEN DELIVERED TO THE
BUYER.

 

(B)           TO SELLERS’ KNOWLEDGE, EACH SELLER PLAN HAS BEEN ADMINISTERED IN
ALL MATERIAL RESPECTS IN ACCORDANCE WITH ITS TERMS AND EACH OF THE SELLERS AND
ITS AFFILIATES HAS IN ALL MATERIAL RESPECTS MET ITS OBLIGATIONS WITH RESPECT TO
EACH SELLER PLAN AND HAS MADE ALL REQUIRED CONTRIBUTIONS THERETO.  TO SELLERS’
KNOWLEDGE, THE SELLERS AND EACH SELLER PLAN ARE IN COMPLIANCE IN ALL MATERIAL
RESPECTS WITH THE CURRENTLY APPLICABLE PROVISIONS OF APPLICABLE LAW, RULE OR
REGULATION.  TO SELLERS’ KNOWLEDGE, ALL FILINGS AND REPORTS AS TO EACH SELLER
PLAN REQUIRED TO HAVE BEEN SUBMITTED TO ANY GOVERNMENTAL ENTITY HAVE BEEN DULY
SUBMITTED.  WITH THE EXCEPTION OF ANY STOCK OPTIONS OR STOCK PURCHASE PLAN, NO
SELLER PLAN HAS ASSETS THAT INCLUDE SECURITIES ISSUED BY THE SELLERS.

 

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(C)           SECTION 2.15(C) OF THE DISCLOSURE SCHEDULE SETS FORTH THE POLICY
OF THE SELLERS WITH RESPECT TO ACCRUED VACATION, ACCRUED SICK TIME AND EARNED
TIME OFF AND THE AMOUNT OF SUCH LIABILITIES AS OF THE MOST RECENT BALANCE SHEET
DATE.

 

2.16         ENVIRONMENTAL MATTERS.

 

(A)           TO SELLERS’S KNOWLEDGE, THE SELLERS HAVE COMPLIED WITH ALL
APPLICABLE ENVIRONMENTAL LAWS RELATING TO THE ACQUIRED BUSINESS.  TO SELLERS’S
KNOWLEDGE, THERE IS NO PENDING OR, TO THE KNOWLEDGE OF THE SELLERS, THREATENED
CIVIL OR CRIMINAL LITIGATION, WRITTEN NOTICE OF VIOLATION, FORMAL ADMINISTRATIVE
PROCEEDING, OR INVESTIGATION, INQUIRY OR INFORMATION REQUEST BY ANY GOVERNMENTAL
ENTITY, RELATING TO ANY ENVIRONMENTAL LAW INVOLVING THE SELLERS WHICH RELATES TO
THE ACQUIRED BUSINESS.

 

(B)           TO SELLERS’S KNOWLEDGE, THERE IS NO MATERIAL ENVIRONMENTAL
LIABILITY OF ANY SOLID OR HAZARDOUS WASTE TRANSPORTER OR TREATMENT, STORAGE OR
DISPOSAL FACILITY THAT HAS BEEN USED BY THE SELLERS RELATING TO THE ACQUIRED
BUSINESS.

 

2.17         LEGAL COMPLIANCE.  TO EACH SELLERS KNOWLEDGE, EACH SELLERS IS
CURRENTLY CONDUCTING, AND HAS AT ALL TIMES SINCE ITS INCORPORATION CONDUCTED,
THE ACQUIRED BUSINESS IN COMPLIANCE WITH EACH APPLICABLE LAW (INCLUDING
RULES AND REGULATIONS THEREUNDER) OF ANY FEDERAL, STATE, LOCAL OR FOREIGN
GOVERNMENT, OR ANY GOVERNMENTAL ENTITY, EXCEPT FOR ANY VIOLATIONS OR DEFAULTS
THAT, INDIVIDUALLY OR IN THE AGGREGATE, HAVE NOT HAD AND WOULD NOT REASONABLY BE
EXPECTED TO HAVE A MATERIAL ADVERSE EFFECT OVER THE OPERATION OF THE ACQUIRED
BUSINESS.  THE SELLERS HAVE NOT RECEIVED ANY NOTICE OR COMMUNICATION FROM ANY
GOVERNMENTAL ENTITY ALLEGING NONCOMPLIANCE WITH ANY APPLICABLE MATERIAL LAW,
RULE OR REGULATION WHICH RELATES TO THE ACQUIRED BUSINESS.

 

2.18         SUPPLIERS.  EXCEPT AS SET FORTH IN SECTION 2.18 OF THE DISCLOSURE
SCHEDULE, TO SELLERS’S KNOWLEDGE, NO SUCH SUPPLIER TO THE ACQUIRED BUSINESS HAS
INDICATED WITHIN THE PAST YEAR THAT IT WILL STOP, OR DECREASE THE RATE OF,
BUYING PRODUCTS OR SERVICES OR SUPPLYING PRODUCTS, AS APPLICABLE, TO THE
SELLERS.

 

2.19         PERMITS.  SECTION 2.19 OF THE DISCLOSURE SCHEDULE SETS FORTH A LIST
OF ALL PERMITS ISSUED TO OR HELD BY THE SELLERS FOR THE CONDUCT OF, OR RELATE,
DIRECTLY OR INDIRECTLY, TO THE ACQUIRED BUSINESS.  TO SELLERS’ KNOWLEDGE, SUCH
LISTED PERMITS ARE THE ONLY PERMITS THAT ARE REQUIRED FOR THE SELLERS TO CONDUCT
THE ACQUIRED BUSINESS AS PRESENTLY CONDUCTED, EXCEPT FOR THOSE THE ABSENCE OF
WHICH, INDIVIDUALLY OR IN THE AGGREGATE, HAVE NOT HAD AND WOULD NOT REASONABLY
BE EXPECTED TO HAVE A MATERIAL ADVERSE EFFECT.  EACH SUCH PERMIT IS IN FULL
FORCE AND EFFECT; TO SELLERS KNOWLEDGE, THE SELLERS ARE IN MATERIAL COMPLIANCE
WITH THE TERMS OF EACH SUCH PERMIT; AND, TO THE BEST KNOWLEDGE OF THE SELLERS,
NO SUSPENSION OR CANCELLATION OF SUCH PERMIT IS THREATENED AND THERE IS NO BASIS
FOR BELIEVING THAT SUCH PERMIT WILL NOT BE RENEWABLE UPON EXPIRATION.  THE
PARTIES ACKNOWLEDGE THAT NO PERMITS SHALL BE ASSIGNED TO BUYER HEREUNDER.

 

2.20         BROKERS’ FEES.  WITH THE EXCEPTION OF ANY FEES REQUIRED TO BE PAID
TO DEUTSCHE BANK (AND FOR WHICH THE SELLERS SHALL BE RESPONSIBLE), THE SELLERS
HAVE NO LIABILITY OR OBLIGATION TO PAY ANY FEES OR COMMISSIONS TO ANY BROKER,
FINDER OR AGENT WITH RESPECT TO THE TRANSACTIONS CONTEMPLATED BY THIS AGREEMENT.

 

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ARTICLE III

 

REPRESENTATIONS AND WARRANTIES OF THE BUYER

 

The Buyer represents and warrants to the Sellers that the statements contained
in this ARTICLE III are true and correct as of the date of this Agreement and
will be true and correct as to the Closing and the Closing Date as though made
as of the Closing, except to the extent that such representations and warranties
are specifically made as of a particular date (in which case such
representations and warranties will be true and correct as of such date).

 

3.1           ORGANIZATION AND CORPORATE POWER.  THE BUYER IS A CORPORATION DULY
ORGANIZED, VALIDLY EXISTING AND IN GOOD STANDING UNDER THE LAWS OF SINGAPORE.

 

3.2           AUTHORIZATION OF THE TRANSACTION.  THE BUYER HAS ALL REQUISITE
POWER AND AUTHORITY TO EXECUTE AND DELIVER THIS AGREEMENT AND THE ANCILLARY
AGREEMENTS AND TO PERFORM ITS OBLIGATIONS HEREUNDER AND THEREUNDER.  THE
EXECUTION AND DELIVERY BY THE BUYER OF THIS AGREEMENT AND THE ANCILLARY
AGREEMENTS, AND THE CONSUMMATION BY THE BUYER OF THE TRANSACTIONS CONTEMPLATED
HEREBY AND THEREBY, HAVE BEEN DULY AND VALIDLY AUTHORIZED BY ALL NECESSARY
CORPORATE ACTION ON THE PART OF THE BUYER.  THIS AGREEMENT HAS BEEN DULY AND
VALIDLY EXECUTED AND DELIVERED BY THE BUYER AND CONSTITUTES A VALID AND BINDING
OBLIGATION OF THE BUYER, ENFORCEABLE AGAINST IT IN ACCORDANCE WITH ITS TERMS
EXCEPT (I) AS LIMITED BY APPLICABLE BANKRUPTCY, INSOLVENCY, REORGANIZATION,
MORATORIUM, FRAUDULENT CONVEYANCE, AND OTHER LAWS OF GENERAL APPLICATION
AFFECTING ENFORCEMENT OF CREDITORS’ RIGHTS GENERALLY, OR (II) AS LIMITED BY LAWS
RELATING TO THE AVAILABILITY OF SPECIFIC PERFORMANCE, INJUNCTIVE RELIEF, OR
OTHER EQUITABLE REMEDIES.

 

3.3           NONCONTRAVENTION.   NEITHER THE EXECUTION AND DELIVERY BY THE
BUYER OF THIS AGREEMENT OR THE ANCILLARY AGREEMENTS, NOR THE CONSUMMATION BY THE
BUYER OF THE TRANSACTIONS CONTEMPLATED HEREBY OR THEREBY, WILL (A) CONFLICT WITH
OR VIOLATE ANY PROVISION OF THE CERTIFICATE OF INCORPORATION OR BYLAWS OF THE
BUYER, (B) REQUIRE ON THE PART OF THE BUYER ANY FILING WITH, OR PERMIT,
AUTHORIZATION, CONSENT OR APPROVAL OF, ANY GOVERNMENTAL ENTITY, (C) CONFLICT
WITH, RESULT IN BREACH OF, CONSTITUTE (WITH OR WITHOUT DUE NOTICE OR LAPSE OF
TIME OR BOTH) A DEFAULT UNDER, RESULT IN THE ACCELERATION OF OBLIGATIONS UNDER,
CREATE IN ANY PARTY ANY RIGHT TO TERMINATE, MODIFY OR CANCEL, OR REQUIRE ANY
NOTICE, CONSENT OR WAIVER UNDER, ANY CONTRACT OR INSTRUMENT TO WHICH THE BUYER
IS A PARTY OR BY WHICH IT IS BOUND OR TO WHICH ANY OF ITS ASSETS IS SUBJECT,
EXCEPT FOR (I) ANY CONFLICT, BREACH, DEFAULT, ACCELERATION, TERMINATION,
MODIFICATION OR CANCELLATION WHICH WOULD NOT ADVERSELY AFFECT THE CONSUMMATION
OF THE TRANSACTIONS CONTEMPLATED HEREBY OR (II) ANY NOTICE, CONSENT OR WAIVER
THE ABSENCE OF WHICH WOULD NOT ADVERSELY AFFECT THE CONSUMMATION OF THE
TRANSACTIONS CONTEMPLATED HEREBY, OR (D) VIOLATE ANY ORDER, WRIT, INJUNCTION,
DECREE, STATUTE, RULE OR REGULATION APPLICABLE TO THE BUYER OR ANY OF ITS
PROPERTIES OR ASSETS.

 

3.4           LITIGATION.  THERE IS NO LEGAL PROCEEDING WHICH IS PENDING OR, TO
THE BEST KNOWLEDGE OF BUYER, THREATENED IN WRITING AGAINST THE BUYER.  THERE ARE
NO JUDGMENTS, ORDERS OR DECREES OUTSTANDING AGAINST THE BUYER.

 

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3.5           BROKERS’ FEES.  THE BUYER HAS NO LIABILITY OR OBLIGATION TO PAY
ANY FEES OR COMMISSIONS TO ANY BROKER, FINDER OR AGENT WITH RESPECT TO THE
TRANSACTIONS CONTEMPLATED BY THIS AGREEMENT.

 

3.6           MAQUILADORA.  BUYER’S MEXICAN AFFILIATE CURRENTLY HAS (AND AT THE
TIME ON WHICH THE ACTIONS REFERENCED IN SECTION 1.8 WILL TAKE PLACE WILL HAVE) A
DULY QUALIFIED IMMEX PROGRAM IN PLACE.

 

ARTICLE IV

 

PRE-CLOSING COVENANTS

 

4.1           CLOSING EFFORTS.  EACH OF THE PARTIES SHALL USE ITS REASONABLE
BEST EFFORTS TO TAKE ALL ACTIONS AND TO DO ALL THINGS NECESSARY, PROPER OR
ADVISABLE TO CONSUMMATE THE TRANSACTIONS CONTEMPLATED BY THIS AGREEMENT,
INCLUDING USING ITS REASONABLE BEST EFFORTS TO ENSURE THAT (I) ITS
REPRESENTATIONS AND WARRANTIES REMAIN TRUE AND CORRECT IN ALL MATERIAL RESPECTS
THROUGH THE CLOSING DATE AND (II) THE CONDITIONS TO THE OBLIGATIONS OF THE OTHER
PARTY TO CONSUMMATE THE TRANSACTIONS CONTEMPLATED BY THIS AGREEMENT ARE
SATISFIED. FOR THESE PURPOSES, SELLERS HEREBY AUTHORIZES BUYER TO INTERVIEW THE
BUSINESS EMPLOYEES, REVIEW FINANCIAL STATEMENTS AND ALL FINANCIAL AND ACCOUNTING
DATA (BUT ONLY TO THE EXTENT IT IS RELATED TO THE OPERATION OF THE ACQUIRED
BUSINESS AND SPECIFICALLY EXCLUDING ANY PROFIT-RELATED DATA) AND IN GENERAL
TERMS, PREPARE THE FACILITY FOR AN ADEQUATE AND SMOOTH TAKE OVER OF THE
OPERATIONS; PROVIDED THAT THESE ACTIVITIES ARE DONE IN A MANNER NOT TO INTERFERE
WITH THE ACQUIRED BUSINESS.

 

4.2           CONSENTS.   EACH PARTY SHALL USE ITS REASONABLE BEST EFFORTS TO
OBTAIN ALL THIRD PARTY CONSENTS REQUIRED FOR CLOSING.

 

4.3           REQUISITE APPROVAL.  THE SELLERS SHALL USE THEIR REASONABLE BEST
EFFORTS TO OBTAIN, AS PROMPTLY AS PRACTICABLE, THE REQUISITE APPROVAL, EITHER AT
A SPECIAL MEETING OF STOCKHOLDERS, OR PURSUANT TO A WRITTEN STOCKHOLDER CONSENT,
ALL IN ACCORDANCE WITH THE APPLICABLE REQUIREMENTS OF THE LAW OF ITS
INCORPORATION.

 

4.4           OPERATION OF BUSINESS.  EXCEPT AS CONTEMPLATED BY THIS AGREEMENT,
DURING THE PERIOD FROM THE DATE OF THIS AGREEMENT TO THE CLOSING, THE SELLERS
SHALL CONDUCT THE ACQUIRED BUSINESS IN THE ORDINARY COURSE OF BUSINESS AND IN
COMPLIANCE WITH ALL APPLICABLE LAWS AND REGULATIONS AND, TO THE EXTENT
CONSISTENT THEREWITH, USE THEIR REASONABLE BEST EFFORTS TO PRESERVE INTACT ITS
CURRENT BUSINESS ORGANIZATION, KEEP ITS PHYSICAL ASSETS IN GOOD WORKING
CONDITION, KEEP AVAILABLE THE SERVICES OF ITS CURRENT OFFICERS AND EMPLOYEES AND
PRESERVE ITS RELATIONSHIPS WITH CUSTOMERS, SUPPLIERS AND OTHERS HAVING BUSINESS
DEALINGS WITH IT.  WITHOUT LIMITING THE GENERALITY OF THE FOREGOING, PRIOR TO
THE CLOSING, THE SELLERS SHALL NOT, WITHOUT THE WRITTEN CONSENT OF THE BUYER:

 

(A)           (I) ENTER INTO, ADOPT OR AMEND ANY EMPLOYEE BENEFIT PLAN (EXCEPT
AS REQUIRED BY LAW) OR (II) EXCEPT IN THE ORDINARY COURSE OF BUSINESS, INCREASE
IN ANY MANNER THE

 

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COMPENSATION OR FRINGE BENEFITS OF, OR MATERIALLY MODIFY THE EMPLOYMENT TERMS OF
OR PAY ANY BONUS OR OTHER BENEFIT TO, ANY BUSINESS EMPLOYEE;

 

(B)           WITH RESPECT TO THE ACQUIRED BUSINESS, ACQUIRE, SELL, LEASE,
LICENSE OR DISPOSE OF ANY  FIXED ASSETS, OTHER THAN PURCHASES AND SALES OF
ASSETS IN THE ORDINARY COURSE OF BUSINESS;

 

(C)           AMEND ITS CERTIFICATE OF INCORPORATION, BYLAWS OR OTHER
ORGANIZATIONAL DOCUMENTS IN A MANNER THAT COULD HAVE AN ADVERSE EFFECT ON THE
TRANSACTIONS CONTEMPLATED BY THIS AGREEMENT;

 

(D)           MAKE ANY NEW ELECTIONS, OR CHANGES TO ANY CURRENT ELECTIONS, WITH
RESPECT TO TAXES THAT AFFECT THE ACQUIRED ASSETS;

 

(E)           MODIFY, WAIVE ANY RIGHT UNDER, AMEND IN ANY MATERIAL RESPECT, TAKE
OR OMIT TO TAKE ANY ACTION THAT WOULD CONSTITUTE A VIOLATION OR DEFAULT UNDER,
OR TERMINATE, THE ASSUMED CONTRACTS;

 

(F)            ENTER INTO ANY MATERIAL CONTRACT OR COMMITMENT AFFECTING THE
ACQUIRED BUSINESS EXCEPT FOR THE NORMAL SALE OF ITS PRODUCTS AND SERVICES, OR
THE PURCHASE OF MATERIALS, SUPPLIES AND SERVICES USEABLE IN THE ORDINARY COURSE
OF BUSINESS;

 

(G)           MODIFY, TERMINATE OR ALLOW TO LAPSE ANY INSURANCE POLICY RELATING
TO THE ACQUIRED BUSINESS OTHER THAN IN THE ORDINARY COURSE OF BUSINESS;

 

(H)           INSTITUTE OR SETTLE ANY LEGAL PROCEEDING;

 

(I)            TAKE ANY ACTION OR FAIL TO TAKE ANY ACTION PERMITTED BY THIS
AGREEMENT WITH THE KNOWLEDGE THAT SUCH ACTION OR FAILURE TO TAKE ACTION WOULD
RESULT IN (I) ANY OF THE REPRESENTATIONS AND WARRANTIES OF THE SELLERS SET FORTH
IN THIS AGREEMENT BECOMING UNTRUE OR (II) ANY OF THE CONDITIONS TO THE CLOSING
SET FORTH IN ARTICLE V NOT BEING SATISFIED; OR

 

(J)            AGREE IN WRITING OR OTHERWISE TO TAKE ANY OF THE FOREGOING
ACTIONS.

 

IN ADDITION TO THE FOREGOING, SELLERS AGREE THAT, IN THE EVENT A BUSINESS
EMPLOYEE RESIGNS OR IS TERMINATED PRIOR TO THE CLOSING DATE, IT WILL CONFER WITH
BUYER PRIOR TO SOLICIT BUYER’S INPUT PRIOR TO MAKING ANY OFFER TO ANY CANDIDATE
FOR REPLACEMENT.  NOTHING HEREIN SHALL PREVENT SELLER FROM MAKING ANY OFFER; THE
INTENT IS SOLELY TO REQUIRE SELLER TO OBTAIN BUYER’S INPUT PRIOR TO MAKING SUCH
A DECISION.  THIS REQUIREMENT SHALL NOT APPLY TO ANY TEMPORARY EMPLOYEE.

 

4.5           REPLACEMENT PURCHASE ORDERS.  THE BUYER SHALL REPLACE ALL
OUTSTANDING PURCHASE ORDERS (THE “REPLACEMENT PURCHASE ORDERS”) WITH SELLERS’S
COMPONENT SUPPLIERS WITH BUYER’S OWN PURCHASE ORDERS SUCH THAT SELLERS IS
RELEASED FROM ALL LIABILITIES IN CONNECTION WITH THESE ORDERS.

 

4.6           ACCESS TO INFORMATION.  THE SELLERS SHALL PERMIT REPRESENTATIVES
OF THE BUYER TO HAVE FULL ACCESS (AT ALL REASONABLE TIMES, AND IN A MANNER SO AS
NOT TO INTERFERE WITH THE NORMAL

 

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BUSINESS OPERATIONS OF THE SELLERS) TO ALL PREMISES, PROPERTIES, FINANCIAL, TAX
AND ACCOUNTING RECORDS, CONTRACTS, BUSINESS DATA, INVENTORY RECORDS, OTHER
RECORDS AND DOCUMENTS, AND PERSONNEL, OF OR PERTAINING TO THE SELLERS AND
RELATING TO THE ACQUIRED BUSINESS (BUT SPECIFICALLY EXCLUDING ANY PROFIT-RELATED
DATA) FOR THE PURPOSE OF PERFORMING SUCH INSPECTIONS AND TESTS AS THE BUYER
DEEMS NECESSARY OR APPROPRIATE.

 

4.7           NOTICE OF BREACHES.  FROM THE DATE OF THIS AGREEMENT UNTIL THE
CLOSING, EACH PARTY SHALL PROMPTLY DELIVER TO THE OTHER PARTY SUPPLEMENTAL
INFORMATION CONCERNING EVENTS OR CIRCUMSTANCES OCCURRING SUBSEQUENT TO THE DATE
HEREOF WHICH WOULD RENDER ANY REPRESENTATION, WARRANTY OR STATEMENT IN THIS
AGREEMENT OR ANY DISCLOSURE SCHEDULE INACCURATE OR INCOMPLETE AT ANY TIME AFTER
THE DATE OF THIS AGREEMENT UNTIL THE CLOSING.  NO SUCH SUPPLEMENTAL INFORMATION
SHALL BE DEEMED TO AVOID OR CURE ANY MISREPRESENTATION OR BREACH OF WARRANTY OR
CONSTITUTE AN AMENDMENT OF ANY REPRESENTATION, WARRANTY OR STATEMENT IN THIS
AGREEMENT OR ANY DISCLOSURE SCHEDULE.

 

4.8           EXCLUSIVITY.

 

(A)           UP TO AND INCLUDING THE CLOSING DATE OR AT SUCH TIME THAT THIS
AGREEMENT IS TERMINATED PURSUANT TO ARTICLE VIII HEREOF, THE SELLERS SHALL NOT,
AND THE SELLERS SHALL REQUIRE EACH OF THEIR AFFILIATES, OFFICERS, DIRECTORS,
EMPLOYEES, REPRESENTATIVES AND AGENTS NOT TO, DIRECTLY OR INDIRECTLY,
(I) INITIATE, SOLICIT, ENCOURAGE OR OTHERWISE FACILITATE ANY INQUIRY, PROPOSAL,
OFFER OR DISCUSSION WITH ANY PARTY (OTHER THAN THE BUYER) CONCERNING ANY MERGER,
REORGANIZATION, CONSOLIDATION, RECAPITALIZATION, BUSINESS COMBINATION,
LIQUIDATION, DISSOLUTION, SHARE EXCHANGE, SALE OF STOCK, SALE OF THE ACQUIRED
BUSINESS, (II) EXCEPT AS REQUIRED BY LAW, FURNISH ANY NON-PUBLIC INFORMATION
CONCERNING THE ACQUIRED BUSINESS TO ANY PARTY (OTHER THAN THE BUYER) OR
(III) ENGAGE IN DISCUSSIONS OR NEGOTIATIONS WITH ANY PARTY (OTHER THAN THE
BUYER) CONCERNING ANY TRANSACTION INVOLVING THE ACQUIRED BUSINESS, THE ACQUIRED
ASSETS OR THE ASSUMED LIABILITIES.

 

(B)           THE SELLERS SHALL IMMEDIATELY NOTIFY ANY PARTY WITH WHICH
DISCUSSIONS OR NEGOTIATIONS OF THE NATURE DESCRIBED IN PARAGRAPH (A) ABOVE WERE
PENDING THAT THE SELLERS IS TERMINATING SUCH DISCUSSIONS OR NEGOTIATIONS.  IF
THE SELLERS RECEIVE ANY INQUIRY, PROPOSAL OR OFFER OF THE NATURE DESCRIBED IN
PARAGRAPH (A) ABOVE, THE SELLERS SHALL, WITHIN ONE BUSINESS DAY AFTER SUCH
RECEIPT, NOTIFY THE BUYER OF SUCH INQUIRY, PROPOSAL OR OFFER, INCLUDING THE
IDENTITY OF THE OTHER PARTY AND THE TERMS OF SUCH INQUIRY, PROPOSAL OR OFFER.

 

4.9           DELIVERY OF INFORMATION.  THE SELLERS SHALL USE THEIR REASONABLE
BEST EFFORTS TO PREPARE AND DELIVER TO BUYER OR ITS DESIGNATED AGENT ALL DUE
DILIGENCE INFORMATION REASONABLY REQUESTED BY THE BUYER ON A TIMELY BASIS, BUT
IN ANY EVENT NOT LATER THAN 15 BUSINESS DAYS PRIOR TO THE CLOSING DATE AND TO
PREPARE AND DELIVER TO THE BUYER THE FINAL DISCLOSURE SCHEDULE NO LATER THAN 4
BUSINESS DAYS PRIOR TO THE CLOSING DATE.  BUYER AGREES TO USE REASONABLE BEST
EFFORTS TO ENSURE THAT ALL DUE DILIGENCE REQUESTS ARE REASONABLE CONSIDERING THE
SCOPE OF THIS TRANSACTION.

 

4.10         EMPLOYEES.  PROVIDED THAT BUYER FIRST OBTAINS THE APPROVAL OF
SELLER’S PLANT MANAGER OR HUMAN RESOURCES MANAGER, THE BUYER SHALL BE PERMITTED
TO CONTACT BUSINESS EMPLOYEES TO ADVISE ANY BUSINESS EMPLOYEE OF ITS INTENT TO
MAKE AN OFFER TO HIM OR HER.

 

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4.11         SOLICITATION AND HIRING.  PRIOR TO THE CLOSING DATE, NEITHER PARTY
SHALL (I) EITHER DIRECTLY OR INDIRECTLY (INCLUDING THROUGH AN AFFILIATE),
SOLICIT OR ATTEMPT TO INDUCE ANY BUSINESS EMPLOYEE TO TERMINATE HIS OR HER
EMPLOYMENT WITH THE SELLERS OR (II) THROUGH AN AFFILIATE HIRE OR ATTEMPT TO HIRE
ANY BUSINESS EMPLOYEE OR TRANSFER OR INDUCE TO TRANSFER THE EMPLOYMENT OF ANY
BUSINESS EMPLOYEE TO AN AFFILIATE, IN EACH CASE WITHOUT THE OTHER PARTY’S PRIOR
WRITTEN CONSENT; PROVIDED, HOWEVER, THAT NOTHING SHALL PREVENT A PARTY FROM
ADVERTISING FOR OPEN POSITIONS IN FORUMS OF GENERAL CIRCULATION OR HIRING AN
BUSINESS EMPLOYEE WHO RESPONDS TO THAT ADVERTISEMENT.

 

ARTICLE V

 

CONDITIONS TO CLOSING

 

5.1           CONDITIONS TO OBLIGATIONS OF EACH PARTY.  THE RESPECTIVE
OBLIGATIONS OF EACH PARTY TO CONSUMMATE THE TRANSACTIONS CONTEMPLATED BY THIS
AGREEMENT TO BE CONSUMMATED AT THE CLOSING ARE SUBJECT TO THE SATISFACTION OF
THE FOLLOWING CONDITIONS THAT SHALL BE MET ON THE CLOSING DATE (UNLESS WAIVED IN
WRITING BY THE PARTIES):

 

(A)           THE EXECUTION OF THE AGREEMENT BY SELLERS SHALL HAVE RECEIVED ALL
THE NECESSARY CORPORATE APPROVALS;

 

(B)           THE EXECUTION OF THE AGREEMENT BY BUYER SHALL HAVE BEEN APPROVED
BY THE BOARD OF DIRECTORS OF THE BUYER; AND

 

(C)           THE PARTIES’ DISPUTE REGARDING THE INVENTORY FOR WHICH SELLERS
ACCEPTS RESPONSIBILITY SHALL NOT EXCEED $500,000.

 

(D)   THE CONSENTS TO THE TRANSFER OR ASSIGNMENT OF THE ASSUMED CONTRACTS SET
FORTH IN SCHEDULE 1.1(A) SHALL HAVE BEEN OBTAINED.

 

5.2           CONDITIONS TO OBLIGATIONS OF THE BUYER.  THE OBLIGATION OF THE
BUYER TO CONSUMMATE THE TRANSACTIONS CONTEMPLATED BY THIS AGREEMENT TO BE
CONSUMMATED AT THE CLOSING IS SUBJECT TO THE SATISFACTION OF THE FOLLOWING
ADDITIONAL CONDITIONS (UNLESS WAIVED IN WRITING BY THE BUYER):

 

(A)           THE REPRESENTATIONS AND WARRANTIES OF THE SELLERS SET FORTH IN
THIS AGREEMENT SHALL BE TRUE AND CORRECT IN ALL MATERIAL RESPECTS, IN EACH CASE
AS OF THE DATE OF THIS AGREEMENT AND AS OF THE CLOSING DATE AS THOUGH MADE AS OF
THE CLOSING DATE, EXCEPT TO THE EXTENT SUCH REPRESENTATIONS AND WARRANTIES ARE
SPECIFICALLY MADE AS OF A PARTICULAR DATE (IN WHICH CASE SUCH REPRESENTATIONS
AND WARRANTIES SHALL BE TRUE AND CORRECT AS OF SUCH DATE);

 

(B)           THE SELLERS SHALL HAVE PERFORMED OR COMPLIED IN ALL MATERIAL
RESPECTS WITH ITS AGREEMENTS AND COVENANTS REQUIRED TO BE PERFORMED OR COMPLIED
WITH UNDER THIS AGREEMENT AS OF OR PRIOR TO THE CLOSING;

 

(C)           NO LEGAL PROCEEDING AFFECTING THE ACQUIRED BUSINESS SHALL BE
PENDING OR THREATENED WHEREIN AN UNFAVORABLE JUDGMENT, ORDER, DECREE,
STIPULATION OR INJUNCTION WOULD

 

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(I) PREVENT CONSUMMATION OF THE TRANSACTIONS CONTEMPLATED BY THIS AGREEMENT,
(II) CAUSE THE TRANSACTIONS CONTEMPLATED BY THIS AGREEMENT TO BE RESCINDED
FOLLOWING CONSUMMATION OR (III) AFFECT ADVERSELY THE RIGHT OF THE BUYER TO
OWN/LEASE (AS APPROPRIATE), OPERATE OR CONTROL ANY OF THE ACQUIRED ASSETS, OR TO
CONDUCT THE ACQUIRED BUSINESS AS CURRENTLY CONDUCTED, FOLLOWING THE CLOSING, AND
NO SUCH JUDGMENT, ORDER, DECREE, STIPULATION OR INJUNCTION SHALL BE IN EFFECT;

 

(D)           SELLERS SHALL HAVE MODIFIED EACH UNION CONTRACT IN A MANNER
ACCEPTABLE TO BUYER, ENABLING BUYER TO SIGN AND REGISTER ITS OWN UNION CONTRACT;

 

(E)           THE SELLERS SHALL HAVE DELIVERED TO THE BUYER THE SELLERS
CERTIFICATE;

 

(F)            THE SELLERS SHALL HAVE DELIVERED TO THE BUYER AN UPDATE, AS OF
THE CLOSING DATE, OF EACH LIST CONTAINED IN THE DISCLOSURE SCHEDULE THAT LISTS
OR DESCRIBES ACQUIRED ASSETS;

 

(G)           THE SELLERS SHALL HAVE DELIVERED TO THE BUYER DOCUMENTS EVIDENCING
THE RELEASE OR TERMINATION OF ALL SECURITY INTERESTS ON THE ACQUIRED ASSETS, AND
COPIES OF ANY DOCUMENTATION FILED OR RECORDED ON THE PUBLIC RECORD TERMINATING
SUCH SECURITY INTERESTS, IF ANY;

 

(H)           EACH PERSON LISTED ON SCHEDULE 5.2(I) HERETO SHALL HAVE EVIDENCED
SUCH PERSON’S ACCEPTANCE OF THE EMPLOYMENT OFFER OF BUYER BY COUNTERSIGNING AND
DELIVERING AN EMPLOYMENT OFFER LETTER IN FORM AND SUBSTANCE SATISFACTORY TO THE
BUYER OR SELLER SHALL HAVE REPLACED SUCH PERSON WITH AN PERSON REASONABLY
ACCEPTABLE TO BUYER (BUYER CANNOT UNREASONABLY REFUSE TO ACCEPT SUCH
REPLACEMENT);

 

(I)            THE SELLERS SHALL HAVE EXECUTED AND DELIVERED TO THE BUYER THE
TRANSITION SERVICES AGREEMENT SUBSTANTIALLY IN THE FORM ATTACHED HERETO AS
EXHIBIT D-1 (THE “TRANSITION SERVICES AGREEMENT”);

 

(J)            THE SELLERS SHALL HAVE EXECUTED AND DELIVERED THE MODIFICATION TO
THE MANUFACTURING AGREEMENT, WHICH SHALL TERMINATE THE MANUFACTURING AGREEMENT
WITH RESPECT TO MEXICAN OPERATIONS AND TRANSFER TO FOXCONN THE MANUFACTURING
AGREEMENT WITH RESPECT TO THE HUNGARIAN OPERATIONS;

 

(K)           EIGHTY-FIVE PERCENT (85%) OF THE INDIVIDUALS TO WHOM BUYER EXTENDS
AN OFFER OF EMPLOYMENT SHALL HAVE ACCEPTED SUCH OFFER.

 

(L)            THE BUYER (OR ITS AFFILIATE) SHALL HAVE RECEIVED ALL OF THE
APPROPRIATE APPROVALS AND DOCUMENTATION EVIDENCING THAT, AS OF THE CLOSING,
BUYER’S AFFILIATE IT MAY OPERATE UNDER AN IMMEX PROGRAM; AND

 

(M)          THE BUYER SHALL HAVE RECEIVED SUCH OTHER CERTIFICATES AND
INSTRUMENTS (INCLUDING CERTIFICATES OF GOOD STANDING OF THE SELLERS IN ITS
JURISDICTION OF ORGANIZATION AND THE VARIOUS FOREIGN JURISDICTIONS IN WHICH IT
IS QUALIFIED, CERTIFIED ORGANIZATIONAL DOCUMENTS, CERTIFICATES AS TO THE
INCUMBENCY OF OFFICERS AND THE ADOPTION OF AUTHORIZING RESOLUTIONS, NAFTA
CERTIFICATES OF ORIGIN WITH RESPECT TO THE INVENTORY) AS IT SHALL REASONABLY
REQUEST IN CONNECTION WITH THE CLOSING.

 

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5.3           CONDITIONS TO OBLIGATIONS OF THE SELLERS.  THE OBLIGATION OF THE
SELLERS TO CONSUMMATE THE TRANSACTIONS CONTEMPLATED BY THIS AGREEMENT TO BE
CONSUMMATED AT THE CLOSING IS SUBJECT TO THE SATISFACTION OF THE FOLLOWING
ADDITIONAL CONDITIONS (UNLESS WAIVED IN WRITING BY THE SELLERS):

 

(A)           THE REPRESENTATIONS AND WARRANTIES OF THE BUYER SET FORTH IN THIS
AGREEMENT SHALL BE TRUE AND CORRECT IN ALL MATERIAL RESPECTS, IN EACH CASE AS OF
THE DATE OF THIS AGREEMENT AND AS OF THE CLOSING DATE AS THOUGH MADE AS OF THE
CLOSING DATE, EXCEPT TO THE EXTENT SUCH REPRESENTATIONS AND WARRANTIES ARE
SPECIFICALLY MADE AS OF A PARTICULAR DATE (IN WHICH CASE SUCH REPRESENTATIONS
AND WARRANTIES SHALL BE TRUE AND CORRECT AS OF SUCH DATE);

 

(B)           THE BUYER SHALL HAVE PERFORMED OR COMPLIED IN ALL MATERIAL
RESPECTS WITH ITS AGREEMENTS AND COVENANTS REQUIRED TO BE PERFORMED OR COMPLIED
WITH UNDER THIS AGREEMENT AS OF OR PRIOR TO THE CLOSING;

 

(C)           NO LEGAL PROCEEDING SHALL BE PENDING OR THREATENED WHEREIN AN
UNFAVORABLE JUDGMENT, ORDER, DECREE, STIPULATION OR INJUNCTION WOULD (I) PREVENT
CONSUMMATION OF THE TRANSACTIONS CONTEMPLATED BY THIS AGREEMENT OR (II) CAUSE
THE TRANSACTIONS CONTEMPLATED BY THIS AGREEMENT TO BE RESCINDED FOLLOWING
CONSUMMATION, AND NO SUCH JUDGMENT, ORDER, DECREE, STIPULATION OR INJUNCTION
SHALL BE IN EFFECT;

 

(D)           A SUFFICIENT NUMBER OF EMPLOYEES HAVE EXECUTED AN EMPLOYMENT
CONTRACT WITH BUYER SUCH THAT SELLERS’S ANTICIPATED LIABILITY FOR SEVERANCE IS
LESS THAN $250,000.

 

(E)           THE BUYER SHALL HAVE DELIVERED TO THE SELLERS THE BUYER
CERTIFICATE;

 

(F)            THE BUYER SHALL HAVE EXECUTED AND DELIVERED TO THE SELLERS THE
FIRST AMENDMENT TO THE LEASE AGREEMENT, IF NECESSARY;

 

(G)           THE BUYER SHALL HAVE EXECUTED AND DELIVERED TO THE SELLERS THE
TRANSITION SERVICES AGREEMENT SUBSTANTIALLY IN THE FORM ATTACHED HERETO AS
EXHIBIT D-1;

 

(H)           THE BUYER SHALL HAVE EXECUTED AND DELIVERED THE MODIFICATION TO
THE MANUFACTURING AGREEMENT;

 

(I)            THE SELLERS SHALL HAVE RECEIVED SUCH OTHER CERTIFICATES AND
INSTRUMENTS (INCLUDING CERTIFICATES OF GOOD STANDING OF THE BUYER IN ITS
JURISDICTION OF ORGANIZATION AND THE VARIOUS FOREIGN JURISDICTIONS IN WHICH IT
IS QUALIFIED, CERTIFIED ORGANIZATIONAL DOCUMENTS, CERTIFICATES AS TO THE
INCUMBENCY OF OFFICERS AND THE ADOPTION OF AUTHORIZING RESOLUTIONS) AS IT SHALL
REASONABLY REQUEST IN CONNECTION WITH THE CLOSING;

 

(J)            THE SELLERS SHALL HAVE CLOSED THE FOXCONN TRANSACTION;

 

(K)           THE BUYER SHALL HAVE ISSUED REPLACEMENT PURCHASE ORDERS BY THE
CLOSING DATE;

 

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(L)            THE SELLER SHALL HAVE SECURED THE RIGHTS FROM THE THIRD PARTY
LICENSORS TO PROVIDE THE TRANSITIONAL SERVICES TO BUYER REQUIRED IN THE
TRANSITIONAL SERVICES AGREEMENT, AND FOXTEQ HOLDINGS INC. CAYMAN (“FOXTEQ”) OR
AN AFFILIATE OF FOXTEQ, SHALL HAVE AGREED TO PROVIDE THE TRANSITIONAL SERVICES
TO BUYER UPON THE CLOSING OF THE FOXCONN TRANSACTION.

 

ARTICLE VI

 

POST-CLOSING COVENANTS

 

6.1           PROPRIETARY INFORMATION.  FROM AND AFTER THE CLOSING, THE SELLERS
SHALL NOT DISCLOSE TO ANY THIRD PARTY OTHER THAN FOXTEQ HOLDINGS, INC. (OR ANY
SUBSIDIARY THEREOF) OR MAKE USE OF (EXCEPT TO PURSUE ITS RIGHTS, UNDER THIS
AGREEMENT OR THE ANCILLARY AGREEMENTS, OR AS REQUIRED BY LAW), AND SHALL USE ITS
REASONABLE BEST EFFORTS TO CAUSE ALL OF ITS AFFILIATES NOT TO DISCLOSE OR MAKE
USE OF, ANY KNOWLEDGE, INFORMATION OR DOCUMENTS OF A CONFIDENTIAL NATURE OR NOT
GENERALLY KNOWN TO THE PUBLIC WITH RESPECT TO ACQUIRED ASSETS, THE ACQUIRED
BUSINESS OR THE BUYER OR ITS BUSINESS (INCLUDING THE FINANCIAL INFORMATION,
TECHNICAL INFORMATION OR DATA RELATING TO THE SELLERS’S PRODUCTS AND NAMES OF
CUSTOMERS OF THE SELLERS), AS WELL AS FILINGS AND TESTIMONY (IF ANY) PRESENTED
IN THE COURSE OF ANY ARBITRATION OF A DISPUTE PURSUANT TO SECTION 7.3 AND THE
ARBITRAL AWARD AND THE ARBITRATOR’S REASONS THEREFOR RELATING TO THE SAME),
EXCEPT TO THE EXTENT THAT SUCH KNOWLEDGE, INFORMATION OR DOCUMENTS SHALL HAVE
BECOME PUBLIC KNOWLEDGE OTHER THAN THROUGH IMPROPER DISCLOSURE BY THE SELLERS OR
AN AFFILIATE.

 

6.2           SOLICITATION AND HIRING.  FOR A PERIOD OF TWO (2) YEARS AFTER THE
CLOSING DATE, THE SELLERS SHALL NOT, EITHER DIRECTLY OR INDIRECTLY (INCLUDING
THROUGH AN AFFILIATE), (1) SOLICIT OR ATTEMPT TO INDUCE ANY BUSINESS EMPLOYEE TO
TERMINATE HIS EMPLOYMENT WITH THE BUYER OR ANY SUBSIDIARY OF THE BUYER OR
(2) HIRE OR ATTEMPT TO HIRE ANY BUSINESS EMPLOYEE WITHOUT BUYER’S WRITTEN
CONSENT, WHICH SHALL NOT BE UNREASONABLY WITHHELD, DELAYED OR CONDITIONED,
PROVIDED THAT THIS CLAUSE (2) SHALL NOT APPLY TO (A) ANY INDIVIDUAL WHOSE
EMPLOYMENT WITH THE BUYER OR A SUBSIDIARY OF THE BUYER HAS BEEN TERMINATED FOR A
PERIOD OF SIX MONTHS OR LONGER OR (B) ANY INDIVIDUAL WHO RESPONDED TO A GENERAL
ADVERTISEMENT BY SELLERS FOR OPEN POSITIONS IN FORUMS OF GENERAL CIRCULATION NOT
SPECIFICALLY TARGETED TO SUCH INDIVIDUAL.  IN ADDITION, FOR A PERIOD OF ONE
(1) YEAR AFTER THE CLOSING DATE, SELLERS SHALL NOT HIRE OR ATTEMPT TO HIRE ANY
BUSINESS EMPLOYEE SET FORTH ON SCHEDULE 6.2, EVEN IN RESPONSE TO A GENERAL
ADVERTISEMENT, WITHOUT BUYER’S WRITTEN PERMISSION; PROVIDED HOWEVER THAT THIS
OBLIGATION WILL BE LIMITED TO THE EXTENT THAT IT DOES NOT CONSTITUTE
DISCRIMINATION OR VIOLATES THIRD PARTIES’ RIGHTS OR ANY APPLICABLE LAWS..

 

6.3           SPECIAL SOLICITATION AND HIRING. SHOULD ANY SELLERS EMPLOYEE
DECIDE NOT TO TRANSFER TO BUYER, NEITHER SELLERS NOR BUYER WILL HIRE HIM OR HER
FOR THE SAME PERIOD DETERMINED IN SECTION 6.2.

 

6.4           TAX MATTERS.  ALL TRANSFER TAXES, DEED EXCISE STAMPS AND SIMILAR
CHARGES RELATED TO THE SALE OR LEASE OF THE ACQUIRED ASSETS CONTEMPLATED BY THIS
AGREEMENT SHALL BE PAID BY THE PARTY DESIGNATED AS THE RESPONSIBLE TAXPAYER
UNDER APPLICABLE LAW.

 

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6.5           SHARING OF DATA.

 

(A)           FOR A PERIOD OF TEN YEARS AFTER THE CLOSING DATE (THE “RETENTION
PERIOD”), SELLERS SHALL BE REQUIRED TO MAINTAIN THE RECORDS ORDINARILY
MAINTAINED ON ITS IT SYSTEMS OR PHYSICALLY MAINTAINED IN LOCATIONS OTHER THAN
THE FACILITY (THE “SELLER RETAINED RECORDS”).  DURING THE RETENTION PERIOD,
BUYER SHALL BE REQUIRED TO MAINTAIN THE RECORDS PHYSICALLY MAINTAINED AT THE
FACILITY (WITH THE EXCEPTION OF EMPLOYMENT AND PAYROLL RECORDS WHICH SHALL BE
KEPT BY THE SELLER FOR A PERIOD OF FIVE YEARS RATHER THAN TEN YEARS) OR LOCATED
IN THE COMPUTERS OF THE HIRED EMPLOYEES (THE “BUYER RETAINED RECORDS”).  DURING
THE RETENTION PERIOD, EACH PARTY SHALL HAVE THE RIGHT  TO HAVE REASONABLE ACCESS
TO SUCH BOOKS, RECORDS AND ACCOUNTS, INCLUDING FINANCIAL AND TAX INFORMATION,
CORRESPONDENCE, PRODUCTION RECORDS, EMPLOYMENT RECORDS AND OTHER RECORDS THAT
ARE HELD BY THE OTHER PARTY PURSUANT TO THE TERMS OF THIS SECTION FOR THE
LIMITED PURPOSES OF CONCLUDING ITS INVOLVEMENT IN THE BUSINESS CONDUCTED BY THE
OTHER PARTY PRIOR TO/AFTER THE CLOSING DATE (AS APPLICABLE) AND FOR COMPLYING
WITH ITS OBLIGATIONS UNDER APPLICABLE SECURITIES, TAX, ENVIRONMENTAL, CUSTOMS,
EMPLOYMENT OR OTHER LAWS AND REGULATIONS. ANY PARTY ACCESSING INFORMATION OF THE
OTHER PARTY PURSUANT TO THIS SECTION 6.5 WILL TAKE ALL REASONABLE PRECAUTIONS TO
PROTECT THE CONFIDENTIALITY OF ANY INFORMATION OBTAINED.  NEITHER THE BUYER NOR
THE SELLERS SHALL DESTROY ANY SUCH BOOKS, RECORDS OR ACCOUNTS RETAINED BY IT
DURING THE RETENTION PERIOD WITHOUT FIRST PROVIDING THE OTHER PARTY WITH THE
OPPORTUNITY TO OBTAIN OR COPY SUCH BOOKS, RECORDS, OR ACCOUNTS AT SUCH OTHER
PARTY’S EXPENSE.

 

(B)           PROMPTLY UPON WRITTEN REQUEST BY THE BUYER MADE AT ANY TIME
FOLLOWING THE CLOSING DATE, THE SELLERS SHALL AUTHORIZE THE RELEASE TO THE BUYER
OF ALL FILES DIRECTLY PERTAINING TO THE SELLERS RELATING PRINCIPALLY TO THE
ACQUIRED BUSINESS (OTHER THAN RECORDS RELATING TO THE PROFITABILITY OF THE
ACQUIRED BUSINESS) OR THE ACQUIRED ASSETS HELD BY ANY FEDERAL, STATE, COUNTY OR
LOCAL AUTHORITIES, AGENCIES OR INSTRUMENTALITIES, PROVIDED THAT THE SELLERS
SHALL HAVE THE OPPORTUNITY TO REASONABLY REDACT IRRELEVANT INFORMATION

 

(C)           PROMPTLY UPON WRITTEN REQUEST BY THE SELLERS MADE AT ANY TIME
FOLLOWING THE CLOSING DATE, THE BUYER SHALL AUTHORIZE THE RELEASE TO THE SELLERS
OF ALL FILES RELATING PRINCIPALLY TO THE RETAINED LIABILITIES OR EXCLUDED
ASSETS.

 

6.6           COOPERATION IN LITIGATION.  FROM AND AFTER THE CLOSING DATE, EACH
PARTY SHALL FULLY COOPERATE WITH THE OTHER IN THE DEFENSE OR PROSECUTION OF ANY
LITIGATION OR PROCEEDING ALREADY INSTITUTED OR WHICH MAY BE INSTITUTED HEREAFTER
AGAINST OR BY SUCH OTHER PARTY RELATING TO OR ARISING OUT OF THE CONDUCT OF THE
ACQUIRED BUSINESS OF THE SELLERS OR THE BUYER PRIOR TO OR AFTER THE CLOSING DATE
(OTHER THAN LITIGATION AMONG THE PARTIES AND/OR THEIR AFFILIATES ARISING OUT THE
TRANSACTIONS CONTEMPLATED BY THIS AGREEMENT), INCLUDING, WITHOUT LIMITATION, BY
RETAINING AND PRODUCING ANY AND ALL DOCUMENTATION RELEVANT TO ANY SUCH
LITIGATION OR PROCEEDING.  THE PARTY REQUESTING SUCH COOPERATION SHALL PAY THE
REASONABLE OUT-OF-POCKET EXPENSES INCURRED IN PROVIDING SUCH COOPERATION
(INCLUDING REASONABLE LEGAL FEES AND DISBURSEMENTS) BY THE PARTY PROVIDING SUCH
COOPERATION AND BY ITS OFFICERS, DIRECTORS, EMPLOYEES AND AGENTS, BUT SHALL NOT
BE RESPONSIBLE FOR REIMBURSING SUCH PARTY OR ITS OFFICERS, DIRECTORS, EMPLOYEES
AND AGENTS, FOR THEIR TIME SPENT IN SUCH COOPERATION.

 

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6.7           EMPLOYEES.

 

(I)            CONTEMPORANEOUSLY WITH THE CLOSING, THE SELLERS SHALL TERMINATE
THE EMPLOYMENT OF EACH BUSINESS EMPLOYEE WHO ACCEPTS ANY OFFER OF EMPLOYMENT
FROM BUYER PURSUANT TO SECTION 6.7(II) (EACH, A “HIRED EMPLOYEE”).  THE SELLERS
HEREBY CONSENTS TO THE HIRING OF ANY SUCH HIRED EMPLOYEES BY THE BUYER AND
WAIVES, WITH RESPECT TO THE EMPLOYMENT BY THE BUYER OF SUCH HIRED EMPLOYEES, ANY
CLAIMS OR RIGHTS THE SELLERS MAY HAVE AGAINST THE BUYER OR ANY SUCH HIRED
EMPLOYEE UNDER ANY NON-COMPETITION, OR EMPLOYMENT AGREEMENT; PROVIDED, HOWEVER,
THAT THE HIRED EMPLOYEES SHALL BE REQUIRED TO OBSERVE ANY NONDISCLOSURE
OBLIGATIONS SET FORTH THEREIN.  EXCEPT AS EXPRESSLY OTHERWISE PROVIDED IN
SUBSECTIONS (B) OR (C) HEREOF, IN NO EVENT SHALL BUYER OR ANY OF ITS AFFILIATES
BE LIABLE FOR ANY WAGES (INCLUDING VACATION TIME, SICK TIME, PAID-TIME-OFF,
COMMISSIONS OR BONUSES), PENSION, UNEMPLOYMENT, RETIREMENT, DISABILITY OR OTHER
BENEFITS OR OBLIGATIONS (I) WHICH IS OWED TO ANY EMPLOYEE OF THE SELLERS WHO
DOES NOT BECOME A HIRED EMPLOYEE OR (II) WHICH IS EARNED BY ANY HIRED EMPLOYEE
ON OR PRIOR TO THE CLOSING.  IN NO EVENT SHALL SELLERS OR ANY OF ITS AFFILIATES
BE LIABLE FOR ANY WAGES (INCLUDING VACATION TIME, SICK TIME, PAID-TIME-OFF,
COMMISSIONS OR BONUSES), PENSION, UNEMPLOYMENT, RETIREMENT, DISABILITY OR OTHER
BENEFITS OR OBLIGATIONS (I) OWED TO ANY EMPLOYEE OF THE SELLERS WHO BECOMES A
HIRED EMPLOYEE AND (II) WHICH IS EARNED BY ANY HIRED EMPLOYEE AFTER THE CLOSING.
IMMEDIATELY AFTER THE CLOSING AND EFFECTIVE AS OF THE EFFECTIVE TIME, SELLERS
SHALL OBTAIN FROM EVERY BUSINESS EMPLOYEE TO WHICH BUYER HAS MADE AN OFFER, A
RESIGNATION LETTER AND SHALL PAY ALL AMOUNTS DUE (“PROPORCIONALES” OR PRORATED
VACATION, CHRISTMAS BONUS, PROFIT SHARING AND ALL PURSUANT TO THE LAW AS PER A
TERMINATION OF THE EMPLOYMENT), WITH THE EXCEPTION OF SEVERANCE SINCE BUYER WILL
HIRE THOSE HIRED EMPLOYEES WITH THEIR SENIORITY.

 

(II)           AS OF THE CLOSING DATE, BUYER ANTICIPATES OFFERING SUBSTANTIALLY
ALL THE BUSINESS EMPLOYEES THE OPPORTUNITY TO BECOME EMPLOYEES OF BUYER OR AN
AFFILIATE, ON SIMILAR TERMS AND CONDITIONS OF EMPLOYMENT AS WERE APPLICABLE TO
SUCH EMPLOYEES IMMEDIATELY PRIOR TO THE CLOSING DATE, AND SHALL AFFORD TO EACH
OF SUCH EMPLOYEES CREDIT FOR YEARS OF SERVICE OF SUCH EMPLOYEES WITH SELLERS FOR
THE PURPOSE OF ELIGIBILITY TO PARTICIPATE AND VESTING UNDER ANY EMPLOYEE PLANS
OR BENEFIT PROGRAMS MAINTAINED BY BUYER FOR SIMILARLY SITUATED EMPLOYEES AND ALL
OBLIGATIONS UNDER ANY ACCRUED OR UNUSED VACATION AND/OR PAID TIME OFF.  IN THE
EVENT BUYER CHOOSES NOT TO OFFER EMPLOYMENT TO ANY BUSINESS EMPLOYEES, SELLERS
SHALL BE RESPONSIBLE FOR ANY SEVERANCE PAYMENT TO SUCH BUSINESS EMPLOYEES, UP TO
A MAXIMUM OF $150,000; BUYER SHALL BE RESPONSIBLE FOR ANY SEVERANCE PAYMENT TO
SUCH BUSINESS EMPLOYEES IN EXCESS OF $150,000.   IN THE EVENT BUYER OFFERS
EMPLOYMENT TO A BUSINESS EMPLOYEE AND THE BUSINESS EMPLOYEE DOES NOT ACCEPT THE
OFFER, SELLERS SHALL BE RESPONSIBLE FOR ANY SEVERANCE PAYMENT TO SUCH BUSINESS
EMPLOYEE; PROVIDED, HOWEVER, THAT SELLERS SHALL RETAIN ITS RIGHT NOT TO CLOSE
THE TRANSACTION SET FORTH UNDER SECTION 5.3  SELLERS WILL TAKE ALL ACTION
NECESSARY TO PAY ANY AND ALL, VACATION, PAID TIME OFF OR OTHER SUMS THAT MAY BE
DUE TO EMPLOYEES OF SELLERS IN CONNECTION WITH THEIR TERMINATION OF EMPLOYMENT
WITH SELLERS, IF ANY, OR OTHERWISE PURSUANT TO THE TERMS OF ANY SELLER PLAN.

 

(III)          LENOVO REPRESENTS AND WARRANTS THAT THE TERMS AND CONDITIONS OF
THE OFFERS MADE TO THE BUSINESS EMPLOYEES UNDER SECTION 6.7(II) WILL BE THE SAME
AS THE TERMS AND CONDITIONS CURRENTLY PROVIDED TO THE BUSINESS EMPLOYEES EXCEPT
AS FOLLOWS: (I) BUYER WILL NOT OFFER THE BUSINESS EMPLOYEES A GUARANTEED PROFIT
SHARING PLAN TO THE SAME EXTENT AS THAT WHICH IS CURRENTLY IN PLACE, BUT INTENDS
TO SUBSTITUTE A PORTION OF THE PROFIT SHARING PLAN WITH A CONTINGENT PERFORMANCE
BONUS; AND (II) BUYER WILL MAKE MINOR CHANGES TO THE CAFETERIA AND

 

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TRANSPORTATION CURRENTLY OFFERED BY SELLER. BUYER SHALL INDEMNIFY, DEFEND AND
HOLD SELLERS HARMLESS FROM ANY LIABILITY, CLAIM OR EXPENSE (INCLUDING REASONABLE
ATTORNEYS’ FEES) RELATED TO ANY CLAIM MADE BY ANY BUSINESS EMPLOYEE THAT (I) THE
CHANGES BUYER MADE TO THE PROFIT SHARING PLAN (SET FORTH IN (I) ABOVE)
CONSTITUTES A “MATERIAL CHANGE IN EMPLOYMENT CONDITIONS” AND/OR A CONSTRUCTIVE
TERMINATION WHICH REQUIRES THE PAYMENT OF SEVERANCE; AND (II) ANY BREACH OF THE
FOREGOING REPRESENTATION.  IN ADDITION, BUYER SHALL DEFEND SELLER (BUT NOT
INDEMNIFY OR HOLD SELLER HARMLESS) AGAINST ANY CLAIM THAT THE CHANGES TO THE
CAFETERIA AND TRANSPORTATION CURRENTLY OFFERED BY SELLER CONSTITUTES A “MATERIAL
CHANGE IN EMPLOYMENT CONDITIONS” AND/OR A CONSTRUCTIVE TERMINATION WHICH
REQUIRES THE PAYMENT OF SEVERANCE.

 

(IV)          SELLERS SHALL BE SOLELY RESPONSIBLE FOR ANY LIABILITY, CLAIM OR
EXPENSE (INCLUDING REASONABLE ATTORNEYS’ FEES) RELATED TO COMPENSATION OR
EMPLOYEE BENEFITS INCURRED BY BUYER AS THE RESULT OF ANY CLAIMS AGAINST BUYER OR
ITS AFFILIATES THAT ARE MADE BY ANY BUSINESS EMPLOYEES OR FORMER EMPLOYEES OF
SELLERS WHO ARE MADE OFFERS OF EMPLOYMENT WITH SELLER BUT WHO CHOOSE NOT TO
ACCEPT THE OFFER (THE PARTIES HAVING ACKNOWLEDGED THAT SELLER RETAINS THE REMEDY
SET FORTH IN SECTION 5.3(D).

 

(V)           THE PARTIES SHALL USE THEIR REASONABLE BEST EFFORTS TO COOPERATE
ON EMPLOYEE-RELATED ISSUES.

 

6.8           PROCEDURES FOR ASSETS NOT TRANSFERABLE.  IF ANY CONTRACT, PERMIT,
OR ANY OTHER PROPERTY OR RIGHT INCLUDED IN THE ASSUMED LIABILITIES OR THE
ACQUIRED ASSETS IS NOT ASSIGNABLE OR TRANSFERABLE WITHOUT THE CONSENT OF A THIRD
PARTY, AND SUCH CONSENT HAS NOT BEEN OBTAINED PRIOR TO THE CLOSING DATE, THIS
AGREEMENT AND THE RELATED INSTRUMENTS OF TRANSFER SHALL NOT CONSTITUTE AN
ASSIGNMENT OR TRANSFER THEREOF, AND BUYER SHALL NOT ASSUME SELLERS’S OBLIGATIONS
WITH RESPECT THERETO, BUT SELLERS SHALL DILIGENTLY USE ITS REASONABLE EFFORTS TO
OBTAIN SUCH CONSENT AS SOON AS POSSIBLE AFTER THE CLOSING DATE; PROVIDED,
HOWEVER, THAT SELLER SHALL NOT BE REQUIRED TO PAY ANY SUMS TO ANY THIRD PARTY TO
OBTAIN SUCH CONSENT.  WITH RESPECT TO EACH SUCH CONTRACT, PROPERTY OR RIGHT FOR
WHICH A NECESSARY CONSENT HAS NOT BEEN OBTAINED (EXCLUDING NONTRANSFERABLE
GOVERNMENTAL PERMITS), SELLERS SHALL USE ALL COMMERCIALLY REASONABLE EFFORTS TO
OTHERWISE OBTAIN FOR BUYER, AT NO ADDITIONAL COST TO BUYER OR SELLERS, THE
BENEFITS OF SUCH CONTRACT, PROPERTY OR RIGHT UNTIL SUCH CONSENT IS OBTAINED.

 

6.9           LICENSIA DEL USO DEL SUELO.  SELLER ACKNOWLEDGES THAT IT IS UNABLE
TO LOCATE ITS LICENSIA DEL USO DEL SUELO, AND AGREES TO ASSIST BUYER IN
RESOLVING ANY ISSUES WITH THE MEXICAN AUTHORITIES AS A RESULT OF ITS INABILITY
TO LOCATE THE LICENSIA DEL USO DEL SUELO.

 

6.10         OPTION TO PURCHASE FIXED ASSETS.  UPON THE EXPIRATION OF THE
FACILITY LEASE AGREEMENT, BUYER SHALL HAVE THE OPTION TO PURCHASE ALL OR ANY OF
THE FIXED ASSETS AT THEIR FAIR MARKET VALUE.

 

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ARTICLE VII

 

INDEMNIFICATION

 

7.1                   INDEMNIFICATION BY THE SELLERS.  THE SELLERS SHALL
INDEMNIFY THE BUYER IN RESPECT OF, AND HOLD THE BUYER HARMLESS AGAINST, DAMAGES
INCURRED OR SUFFERED BY THE BUYER OR ANY AFFILIATE THEREOF RESULTING FROM,
RELATING TO OR CONSTITUTING:

 

(A)           ANY BREACH, AS OF THE DATE OF THIS AGREEMENT OR AS OF THE CLOSING
DATE, OF ANY REPRESENTATION OR WARRANTY OF THE SELLERS CONTAINED IN THIS
AGREEMENT, ANY ANCILLARY AGREEMENT OR ANY OTHER AGREEMENT OR INSTRUMENT
FURNISHED BY THE SELLERS TO THE BUYER PURSUANT TO THIS AGREEMENT;

 

(B)           ANY FAILURE TO PERFORM ANY COVENANT OR AGREEMENT OF THE SELLERS
CONTAINED IN THIS AGREEMENT, ANY ANCILLARY AGREEMENT OR ANY AGREEMENT OR
INSTRUMENT FURNISHED BY THE SELLERS TO THE BUYER PURSUANT TO THIS AGREEMENT;

 

(C)           ANY RETAINED LIABILITIES;

 

(D)           LIABILITIES OF SELLER ARISING FROM OR RELATING TO THE OWNERSHIP OR
ACTIONS OR INACTIONS OF SELLERS OR THE CONDUCT OF THE ACQUIRED BUSINESS PRIOR TO
THE CLOSING DATE; AND

 

(E)         ANY AND ALL DAMAGES SUFFERED OR INCURRED BY BUYER BY REASON OF OR IN
CONNECTION WITH ANY CLAIM OR CAUSE OF ACTION OF ANY THIRD PARTY TO THE EXTENT
ARISING OUT OF THE OPERATION OF THE ACQUIRED BUSINESS PRIOR TO THE CLOSING DATE.

 

7.2           INDEMNIFICATION BY THE BUYER.  THE BUYER SHALL INDEMNIFY THE
SELLERS IN RESPECT OF, AND HOLD THEM HARMLESS AGAINST, ANY AND ALL DAMAGES
INCURRED OR SUFFERED BY THE SELLERS OR ANY AFFILIATE THEREOF RESULTING FROM,
RELATING TO OR CONSTITUTING:

 

(A)           ANY BREACH, AS OF THE DATE OF THIS AGREEMENT OR AS OF THE CLOSING
DATE, OF ANY REPRESENTATION OR WARRANTY OF THE BUYER CONTAINED IN THIS
AGREEMENT, ANY ANCILLARY AGREEMENT OR ANY OTHER AGREEMENT OR INSTRUMENT
FURNISHED BY THE BUYER TO THE SELLERS PURSUANT TO THIS AGREEMENT;

 

(B)           ANY FAILURE TO PERFORM ANY COVENANT OR AGREEMENT OF THE BUYER
CONTAINED IN THIS AGREEMENT, ANY ANCILLARY AGREEMENT OR ANY OTHER AGREEMENT OR
INSTRUMENT FURNISHED BY THE BUYER TO THE SELLERS PURSUANT TO THIS AGREEMENT;

 

(C)           ANY ASSUMED LIABILITIES;

 

(D)           LIABILITIES OF BUYER ARISING FROM OR RELATING TO THE OWNERSHIP OR
ACTIONS OR INACTIONS OF BUYER OR THE CONDUCT OF THE ACQUIRED BUSINESS ON OR
AFTER THE CLOSING DATE; AND

 

(E)           ANY AND ALL DAMAGES SUFFERED OR INCURRED BY A SELLER BY REASON OF
OR IN CONNECTION WITH ANY CLAIM OR CAUSE OF ACTION OF ANY THIRD PARTY TO THE
EXTENT ARISING OUT OF THE OPERATION OF THE ACQUIRED BUSINESS ON OR AFTER THE
CLOSING.

 

7.3           INDEMNIFICATION CLAIMS.

 

(A)           THIRD PARTY ACTIONS.  AN INDEMNIFIED PARTY SHALL GIVE WRITTEN
NOTIFICATION (AND, IF APPLICABLE, A COPY OF THE RELATED SUMMONS AND COMPLAINT)
TO THE INDEMNIFYING PARTY OF

 

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THE COMMENCEMENT OF ANY THIRD PARTY ACTION.  SUCH NOTIFICATION SHALL BE GIVEN
WITHIN 20 DAYS AFTER RECEIPT BY THE INDEMNIFIED PARTY OF NOTICE OF SUCH THIRD
PARTY ACTION AND SHALL DESCRIBE IN REASONABLE DETAIL (TO THE EXTENT KNOWN BY THE
INDEMNIFIED PARTY) THE FACTS CONSTITUTING THE BASIS FOR SUCH THIRD PARTY ACTION
AND THE AMOUNT OF THE CLAIMED DAMAGES; PROVIDED, HOWEVER, THAT NO DELAY OR
FAILURE ON THE PART OF THE INDEMNIFIED PARTY IN SO NOTIFYING THE INDEMNIFYING
PARTY SHALL RELIEVE THE INDEMNIFYING PARTY OF ANY LIABILITY OR OBLIGATION
HEREUNDER EXCEPT TO THE EXTENT OF ANY DAMAGE OR LIABILITY CAUSED BY OR ARISING
OUT OF SUCH FAILURE.  WITHIN 20 DAYS AFTER DELIVERY OF SUCH NOTIFICATION, THE
INDEMNIFYING PARTY MAY, UPON WRITTEN NOTICE THEREOF TO THE INDEMNIFIED PARTY,
ASSUME CONTROL OF THE DEFENSE OF SUCH THIRD PARTY ACTION WITH COUNSEL REASONABLY
SATISFACTORY TO THE INDEMNIFIED PARTY; PROVIDED THAT (I) THE INDEMNIFYING PARTY
MAY ONLY ASSUME CONTROL OF SUCH DEFENSE IF (A) IT ACKNOWLEDGES IN WRITING TO THE
INDEMNIFIED PARTY THAT ANY DAMAGES, FINES, COSTS OR OTHER LIABILITIES THAT MAY
BE ASSESSED AGAINST THE INDEMNIFIED PARTY IN CONNECTION WITH SUCH THIRD PARTY
ACTION CONSTITUTE DAMAGES FOR WHICH THE INDEMNIFIED PARTY SHALL BE INDEMNIFIED
PURSUANT TO THIS ARTICLE VII AND (B) THE AD DAMNUM IS LESS THAN OR EQUAL TO THE
AMOUNT OF DAMAGES FOR WHICH THE INDEMNIFYING PARTY IS LIABLE UNDER THIS ARTICLE
VII AND (II) THE INDEMNIFYING PARTY MAY NOT ASSUME CONTROL OF THE DEFENSE OF
THIRD PARTY ACTION INVOLVING CRIMINAL LIABILITY OR IN WHICH EQUITABLE RELIEF IS
SOUGHT AGAINST THE INDEMNIFIED PARTY.  IF THE INDEMNIFYING PARTY DOES NOT, OR IS
NOT PERMITTED UNDER THE TERMS HEREOF TO, TO ASSUME CONTROL OF THE DEFENSE OF A
THIRD PARTY ACTION, THE INDEMNIFIED PARTY SHALL CONTROL SUCH DEFENSE.  THE
NON-CONTROLLING PARTY MAY PARTICIPATE IN SUCH DEFENSE AT ITS OWN EXPENSE.  THE
CONTROLLING PARTY SHALL KEEP THE NON-CONTROLLING PARTY ADVISED OF THE STATUS OF
SUCH THIRD PARTY ACTION AND THE DEFENSE THEREOF AND SHALL CONSIDER IN GOOD FAITH
RECOMMENDATIONS MADE BY THE NON-CONTROLLING PARTY WITH RESPECT THERETO.  THE
NON-CONTROLLING PARTY SHALL FURNISH THE CONTROLLING PARTY WITH SUCH INFORMATION
AS IT MAY HAVE WITH RESPECT TO SUCH THIRD PARTY ACTION (INCLUDING COPIES OF ANY
SUMMONS, COMPLAINT OR OTHER PLEADING WHICH MAY HAVE BEEN SERVED ON SUCH PARTY
AND ANY WRITTEN CLAIM, DEMAND, INVOICE, BILLING OR OTHER DOCUMENT EVIDENCING OR
ASSERTING THE SAME) AND SHALL OTHERWISE COOPERATE WITH AND ASSIST THE
CONTROLLING PARTY IN THE DEFENSE OF SUCH THIRD PARTY ACTION.  THE REASONABLE
FEES AND EXPENSES OF COUNSEL TO THE INDEMNIFIED PARTY WITH RESPECT TO A THIRD
PARTY ACTION SHALL BE CONSIDERED DAMAGES FOR PURPOSES OF THIS AGREEMENT IF
(I) THE INDEMNIFIED PARTY CONTROLS THE DEFENSE OF SUCH THIRD PARTY ACTION
PURSUANT TO THE TERMS OF THIS SECTION 7.3(A) OR (II) THE INDEMNIFYING PARTY
ASSUMES CONTROL OF SUCH DEFENSE AND THE INDEMNIFIED PARTY REASONABLY CONCLUDES
THAT THE INDEMNIFYING PARTY AND THE INDEMNIFIED PARTY HAVE CONFLICTING INTERESTS
OR DIFFERENT DEFENSES AVAILABLE WITH RESPECT TO SUCH THIRD PARTY ACTION.  THE
INDEMNIFYING PARTY SHALL NOT AGREE TO ANY SETTLEMENT OF, OR THE ENTRY OF ANY
JUDGMENT ARISING FROM, ANY THIRD PARTY ACTION WITHOUT THE PRIOR WRITTEN CONSENT
OF THE INDEMNIFIED PARTY, WHICH SHALL NOT BE UNREASONABLY WITHHELD, CONDITIONED
OR DELAYED.  THE INDEMNIFIED PARTY SHALL NOT AGREE TO ANY SETTLEMENT OF, OR THE
ENTRY OF ANY JUDGMENT ARISING FROM, ANY SUCH THIRD PARTY ACTION WITHOUT THE
PRIOR WRITTEN CONSENT OF THE INDEMNIFYING PARTY, WHICH SHALL NOT BE UNREASONABLY
WITHHELD, CONDITIONED OR DELAYED.

 

(B)           INDEMNIFICATION CLAIMS.

 

(I)            IN ORDER TO SEEK INDEMNIFICATION UNDER THIS ARTICLE VII, AN
INDEMNIFIED PARTY SHALL DELIVER A CLAIM NOTICE TO THE INDEMNIFYING PARTY.

 

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(II)           WITHIN 20 DAYS AFTER DELIVERY OF A CLAIM NOTICE, THE INDEMNIFYING
PARTY SHALL DELIVER TO THE INDEMNIFIED PARTY A RESPONSE, IN WHICH THE
INDEMNIFYING PARTY SHALL:  (A) AGREE THAT THE INDEMNIFIED PARTY IS ENTITLED TO
RECEIVE ALL OF THE CLAIMED AMOUNT (IN WHICH CASE THE RESPONSE SHALL BE
ACCOMPANIED BY A PAYMENT BY THE INDEMNIFYING PARTY TO THE INDEMNIFIED PARTY OF
THE CLAIMED AMOUNT, BY CHECK OR BY WIRE TRANSFER); (B) AGREE THAT THE
INDEMNIFIED PARTY IS ENTITLED TO RECEIVE THE AGREED AMOUNT (IN WHICH CASE THE
RESPONSE SHALL BE ACCOMPANIED BY A PAYMENT BY THE INDEMNIFYING PARTY TO THE
INDEMNIFIED PARTY OF THE AGREED AMOUNT, BY CHECK OR BY WIRE TRANSFER), OR
(C) DISPUTE THAT THE INDEMNIFIED PARTY IS ENTITLED TO RECEIVE ANY OF THE CLAIMED
AMOUNT.

 

(III)          DURING THE 30 DAY PERIOD FOLLOWING THE DELIVERY OF A RESPONSE
THAT REFLECTS A DISPUTE, THE INDEMNIFYING PARTY AND THE INDEMNIFIED PARTY SHALL
USE GOOD FAITH EFFORTS TO RESOLVE THE DISPUTE.  IF THE DISPUTE IS NOT RESOLVED
WITHIN SUCH 30 DAY PERIOD, THE INDEMNIFYING PARTY AND THE INDEMNIFIED PARTY
SHALL DISCUSS IN GOOD FAITH THE SUBMISSION OF THE DISPUTE TO BINDING
ARBITRATION, AND IF THE INDEMNIFYING PARTY AND THE INDEMNIFIED PARTY AGREE IN
WRITING TO SUBMIT THE DISPUTE TO SUCH ARBITRATION, THEN THE PROVISIONS OF
SECTION 7.3(B)(IV) SHALL BECOME EFFECTIVE WITH RESPECT TO SUCH DISPUTE.  THE
PROVISIONS OF THIS SECTION 7.3(B)(III) SHALL NOT OBLIGATE THE INDEMNIFYING PARTY
AND THE INDEMNIFIED PARTY TO SUBMIT TO ARBITRATION OR ANY OTHER ALTERNATIVE
DISPUTE RESOLUTION PROCEDURE WITH RESPECT TO ANY DISPUTE, AND IN THE ABSENCE OF
AN AGREEMENT BY THE INDEMNIFYING PARTY AND THE INDEMNIFIED PARTY TO ARBITRATE
ANY DISPUTE, SUCH DISPUTE SHALL BE RESOLVED IN A COURT SITTING IN MEXICO DF, IN
ACCORDANCE WITH SECTION 10.12.  THE PARTIES WAIVE THE RIGHT TO HAVE THE DISPUTE
HEARD IN ANY OTHER COURT.

 

(IV)          IF, AS SET FORTH IN SECTION 7.3(B)(III), THE INDEMNIFIED PARTY AND
THE INDEMNIFYING PARTY AGREE TO SUBMIT ANY DISPUTE TO BINDING ARBITRATION, SUCH
DISPUTE SHALL BE RESOLVED BY FINAL AND BINDING ARBITRATION IN MEXICO DF,
ADMINISTERED BY THE AMERICAN ARBITRATION ASSOCIATION APPLYING THE ARBITRATION
RULES.  THE ARBITRATION SHALL BE CONDUCTED BY A SINGLE ARBITRATOR SELECTED BY
THE PARTIES FROM A LIST OF ARBITRATORS PROVIDED BY THE AMERICAN ARBITRATION
ASSOCIATION OF MEXICAN ACTIVE OR RETIRED ATTORNEYS, LAW PROFESSORS OR JUDICIAL
OFFICERS WITH AT LEAST 10 YEARS EXPERIENCE IN GENERAL COMMERCIAL MATTERS (THE
“ARBITRATOR).

 

(A)          IN THE EVENT OF ANY CONFLICT BETWEEN THE ARBITRATION RULES IN
EFFECT FROM TIME TO TIME AND THE PROVISIONS OF THIS AGREEMENT, THE PROVISIONS OF
THIS AGREEMENT SHALL PREVAIL AND BE CONTROLLING.

 

(B)           THE PARTIES SHALL COMMENCE THE ARBITRATION BY JOINTLY FILING A
WRITTEN SUBMISSION WITH THE OFFICE OF THE AMERICAN ARBITRATION ASSOCIATION IN
MEXICO DF, IN ACCORDANCE WITH THE ARBITRATION RULES.  IF WITHIN 10 DAYS AFTER
THE EXPIRATION OF THE 30-DAY PERIOD IN SECTION 7.3(B)(III) THE PARTIES DO NOT
JOINTLY SUBMIT SUCH WRITTEN SUBMISSION TO THE AMERICAN ARBITRATION ASSOCIATION,
THEN EITHER PARTY MAY COMMENCE A LEGAL ACTION IN THE APPROPRIATE COURT IN
ACCORDANCE WITH SECTION 10.8 HEREOF.

 

(C)           ANY DEPOSITIONS OR OTHER DISCOVERY SHALL BE CONDUCTED IN
CONNECTION WITH THE ARBITRATION IN ACCORDANCE WITH THE ARBITRATION RULES.

 

(D)          NOT LATER THAN 30 DAYS AFTER THE CONCLUSION OF THE ARBITRATION
HEARING, THE ARBITRATOR SHALL PREPARE AND DISTRIBUTE TO THE PARTIES A WRITING
SETTING FORTH THE

 

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ARBITRAL AWARD AND THE ARBITRATOR’S REASONS THEREFOR.  ANY AWARD RENDERED BY THE
ARBITRATOR SHALL BE FINAL, CONCLUSIVE AND BINDING UPON THE PARTIES, AND JUDGMENT
THEREON MAY BE ENTERED AND ENFORCED IN ANY COURT OF COMPETENT JURISDICTION
(SUBJECT TO SECTION 10.12), PROVIDED THAT THE ARBITRATOR SHALL HAVE NO POWER OR
AUTHORITY TO GRANT INJUNCTIVE RELIEF, SPECIFIC PERFORMANCE OR OTHER EQUITABLE
RELIEF.

 

(E)           THE ARBITRATOR SHALL HAVE NO POWER OR AUTHORITY, UNDER THE
ARBITRATION RULES OR OTHERWISE, TO (X) MODIFY OR DISREGARD ANY PROVISION OF THIS
AGREEMENT, INCLUDING THE PROVISIONS OF THIS SECTION 7.3(B)(IV), OR (Y) ADDRESS
OR RESOLVE ANY ISSUE NOT SUBMITTED BY THE PARTIES.

 

(F)           IN CONNECTION WITH ANY ARBITRATION PROCEEDING PURSUANT TO THIS
AGREEMENT, EACH PARTY SHALL BEAR ITS OWN COSTS AND EXPENSES (INCLUDING SUCH
PARTY’S OWN RESPECTIVE LEGAL FEES AND RELATED DISBURSEMENTS), EXCEPT THAT THE
FEES AND COSTS OF THE ARBITRATOR, THE COSTS AND EXPENSES OF OBTAINING THE
FACILITY WHERE THE ARBITRATION HEARING IS HELD, AND SUCH OTHER COSTS AND
EXPENSES AS THE ARBITRATOR MAY DETERMINE TO BE DIRECTLY RELATED TO THE CONDUCT
OF THE ARBITRATION AND APPROPRIATELY BORNE JOINTLY BY THE PARTIES (WHICH SHALL
NOT INCLUDE ANY PARTY’S ATTORNEYS’ FEES OR COSTS, WITNESS FEES (IF ANY), COSTS
OF INVESTIGATION AND SIMILAR EXPENSES) SHALL BE SHARED EQUALLY BY THE
INDEMNIFIED PARTY AND THE INDEMNIFYING PARTY.

 

(V)           NOTWITHSTANDING THE OTHER PROVISIONS OF THIS SECTION 7.3, IF A
THIRD PARTY ASSERTS (OTHER THAN BY MEANS OF A LAWSUIT) THAT AN INDEMNIFIED PARTY
IS LIABLE TO SUCH THIRD PARTY FOR A MONETARY OR OTHER OBLIGATION WHICH MAY
CONSTITUTE OR RESULT IN DAMAGES FOR WHICH SUCH INDEMNIFIED PARTY MAY BE ENTITLED
TO INDEMNIFICATION PURSUANT TO THIS ARTICLE VII, AND SUCH INDEMNIFIED PARTY
REASONABLY DETERMINES THAT IT HAS A VALID BUSINESS REASON TO FULFILL SUCH
OBLIGATION, THEN (I) SUCH INDEMNIFIED PARTY SHALL BE ENTITLED TO SATISFY SUCH
OBLIGATION, PROVIDED THAT IN SUCH EVENT THAT THE INDEMNIFIED PARTY PROVIDES THE
INDEMNIFYING PARTY WITH AT LEAST 15 BUSINESS DAYS NOTICE THEREOF AND THAT SUCH
INDEMNIFYING PARTY CONSENTS IN WRITING TO THE INDEMNIFIED PARTY’S FULFILLMENT OF
SUCH OBLIGATION WHICH CONSENT SHALL NOT BE UNREASONABLY WITHHELD, DELAYED OR
CONDITIONED, (II) SUCH INDEMNIFIED PARTY MAY SUBSEQUENTLY MAKE A CLAIM FOR
INDEMNIFICATION IN ACCORDANCE WITH THE PROVISIONS OF THIS ARTICLE VII, AND
(III) SUCH INDEMNIFIED PARTY SHALL BE REIMBURSED, IN ACCORDANCE WITH THE
PROVISIONS OF THIS ARTICLE VII, FOR ANY SUCH DAMAGES FOR WHICH IT IS ENTITLED TO
INDEMNIFICATION PURSUANT TO THIS ARTICLE VII (SUBJECT TO THE RIGHT OF THE
INDEMNIFYING PARTY TO DISPUTE THE INDEMNIFIED PARTY’S ENTITLEMENT TO
INDEMNIFICATION, OR THE AMOUNT FOR WHICH IT IS ENTITLED TO INDEMNIFICATION,
UNDER THE TERMS OF THIS ARTICLE VII).  FAILING SUCH NOTICE THE INDEMNIFIED PARTY
SHALL REMAIN LIABLE FOR SUCH DAMAGES.

 

7.4           SURVIVAL OF REPRESENTATIONS AND WARRANTIES.  ALL REPRESENTATIONS
AND WARRANTIES THAT ARE COVERED BY THE INDEMNIFICATION AGREEMENTS IN
SECTION 7.1(A) AND SECTION 7.2(A) SHALL (A) SURVIVE THE CLOSING AND (B) SHALL
EXPIRE ON THE DATE EIGHTEEN MONTHS FOLLOWING THE CLOSING DATE, EXCEPT THAT
(I) THE REPRESENTATIONS AND WARRANTIES SET FORTH IN SECTIONS 2.1, 2.3, 3.1 AND
3.2 SHALL SURVIVE THE CLOSING WITHOUT LIMITATION; AND (II) THE REPRESENTATIONS
AND WARRANTIES SET FORTH IN SECTIONS 2.8 AND 2.16 SHALL SURVIVE UNTIL 30 DAYS
FOLLOWING EXPIRATION OF ALL STATUTES OF LIMITATION APPLICABLE TO THE MATTERS
REFERRED TO THEREIN.  IF AN INDEMNIFIED PARTY DELIVERS TO AN INDEMNIFYING PARTY,
BEFORE EXPIRATION OF A REPRESENTATION OR WARRANTY, EITHER A CLAIM NOTICE BASED
UPON A

 

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BREACH OF SUCH REPRESENTATION OR WARRANTY, OR AN EXPECTED CLAIM NOTICE BASED
UPON A BREACH OF SUCH REPRESENTATION OR WARRANTY, THEN THE APPLICABLE
REPRESENTATION OR WARRANTY SHALL SURVIVE UNTIL, BUT ONLY FOR PURPOSES OF, THE
RESOLUTION OF THE MATTER COVERED BY SUCH NOTICE.  IF THE LEGAL PROCEEDING OR
WRITTEN CLAIM WITH RESPECT TO WHICH AN EXPECTED CLAIM NOTICE HAS BEEN GIVEN IS
DEFINITIVELY WITHDRAWN OR RESOLVED IN FAVOR OF THE INDEMNIFIED PARTY, THE
INDEMNIFIED PARTY SHALL PROMPTLY SO NOTIFY THE INDEMNIFYING PARTY.  THE RIGHTS
TO INDEMNIFICATION SET FORTH IN THIS ARTICLE VII SHALL NOT BE AFFECTED BY
(I) ANY INVESTIGATION CONDUCTED BY OR ON BEHALF OF AN INDEMNIFIED PARTY OR ANY
KNOWLEDGE ACQUIRED (OR CAPABLE OF BEING ACQUIRED) BY AN INDEMNIFIED PARTY,
WHETHER BEFORE OR AFTER THE DATE OF THIS AGREEMENT OR THE CLOSING DATE
(INCLUDING THROUGH SUPPLEMENTS TO THE DISCLOSURE SCHEDULE PERMITTED BY
SECTION 4.6), WITH RESPECT TO THE INACCURACY OR NONCOMPLIANCE WITH ANY
REPRESENTATION, WARRANTY, COVENANT OR OBLIGATION WHICH IS THE SUBJECT OF
INDEMNIFICATION HEREUNDER OR (II) ANY WAIVER BY AN INDEMNIFIED PARTY OF ANY
CLOSING CONDITION RELATING TO THE ACCURACY OF ANY REPRESENTATIONS AND WARRANTIES
OR THE PERFORMANCE OF OR COMPLIANCE WITH AGREEMENTS AND COVENANTS.

 

7.5           LIMITATIONS.

 

(A)           NOTWITHSTANDING ANYTHING TO THE CONTRARY HEREIN (OTHER THAN AS
SPECIFICALLY PROVIDED IN THE FOLLOWING SENTENCE), THE AGGREGATE LIABILITY OF THE
SELLERS UNDER THIS AGREEMENT, WHETHER A CLAIM IS MADE IN TORT, CONTRACT OR
OTHERWISE, SHALL NOT EXCEED THE BASE PURCHASE PRICE SET FORTH IN
SECTION 1.3(A).  THE CAP IN THE PREVIOUS SENTENCE SHALL NOT APPLY TO THE EXTENT
THE FOLLOWING TWO CONDITIONS ARE MET: (I) THE INVENTORY IS DAMAGED; AND (II) THE
DAMAGE WAS CAUSED BY SELLERS RATHER THAN THE SUPPLIER (E.G., SELLERS IS NOT
WARRANTING THE INVENTORY, BUT ONLY ITS STORING AND HANDLING OF THE INVENTORY)

 

(B)           TO THE EXTENT A PARTY RECOVERS FOR ANY CLAIM UNDER ANY ANCILLARY
AGREEMENT, SUCH PARTY SHALL BE PROHIBITED FROM RECOVERING FOR THE SAME OR
SIMILAR CLAIMS UNDER THIS AGREEMENT.

 

(C)   NOTWITHSTANDING ANYTHING TO THE CONTRARY HEREIN, (I) THE AGGREGATE
LIABILITY OF THE SELLERS FOR DAMAGES UNDER SECTION 7.1(A) SHALL NOT EXCEED
US$500,000, AND (II) THE SELLERS SHALL NOT BE LIABLE UNDER SECTION 7.1(A) UNLESS
AND UNTIL THE AGGREGATE DAMAGES FOR WHICH THEY WOULD OTHERWISE BE LIABLE UNDER
SECTION 7.1(A) EXCEED US $50,000 (AT WHICH POINT THE SELLERS SHALL BECOME LIABLE
FOR THE AMOUNT OF DAMAGES UNDER SECTION 7.1(A), IN EXCESS OF US $50,000);
PROVIDED THAT THE LIMITATIONS SET FORTH IN THIS SENTENCE SHALL NOT APPLY TO A
CLAIM PURSUANT TO SECTION 7.1(A) RELATING TO A BREACH OF THE REPRESENTATIONS AND
WARRANTIES SET FORTH IN SECTIONS 2.1 OR 2.3.

 

(D)           NOTWITHSTANDING ANYTHING TO THE CONTRARY HEREIN, (I) THE AGGREGATE
LIABILITY OF THE BUYER FOR DAMAGES UNDER SECTION 7.2(A) SHALL NOT EXCEED US$
500,000, AND (II)  THE BUYER SHALL NOT BE LIABLE UNDER THIS
SECTION 7.2(A) UNLESS AND UNTIL THE AGGREGATE DAMAGES FOR WHICH IT WOULD
OTHERWISE BE LIABLE UNDER SECTION 7.2(A) EXCEED US$ 50,000 (AT WHICH POINT THE
BUYER SHALL BECOME LIABLE FOR THE AGGREGATE DAMAGES UNDER SECTION 7.2(A) IN
EXCESS OF US$ 50,000); PROVIDED THAT THE LIMITATION SET FORTH IN THIS SENTENCE
SHALL NOT APPLY TO A CLAIM PURSUANT TO SECTION 7.2(A) RELATING TO A BREACH OF
THE REPRESENTATIONS AND WARRANTIES SET FORTH IN SECTIONS 3.1 OR 3.2.

 

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(E)           NOTWITHSTANDING ANYTHING TO THE CONTRARY HEREIN, SELLER’S
LIABILITY FOR A BREACH OF THE REPRESENTATION MADE IN SECTION 2.9(A) SHALL BE
LIMITED TO THE FAIR MARKET VALUE OF THE PARTICULAR ACQUIRED ASSET FROM WHICH THE
BREACH RESULTS.

 

(F)    EXCEPT WITH RESPECT TO CLAIMS BASED ON FRAUD, AFTER THE CLOSING DATE, THE
REMEDIES PROVIDED IN THIS ARTICLE VII SHALL BE THE SOLE AND EXCLUSIVE REMEDIES
OF ANY PARTY WITH RESPECT TO CLAIMS ARISING OUT OF OR RELATING TO THIS
AGREEMENT.

 

7.6           TREATMENT OF INDEMNITY PAYMENTS.  ANY PAYMENTS MADE TO AN
INDEMNIFIED PARTY PURSUANT TO THIS ARTICLE VII SHALL BE TREATED AS AN ADJUSTMENT
TO THE PURCHASE PRICE FOR TAX PURPOSES.

 

7.7           RIGHT OF SET-OFF.  EACH PARTY SHALL HAVE THE RIGHT TO SET OFF
AGAINST ANY AMOUNT OWED BY SUCH PARTY TO THE OTHER PARTY ANY AMOUNTS DUE TO SUCH
PARTY UNDER THIS AGREEMENT.

 

ARTICLE VIII

 

TERMINATION

 

8.1           TERMINATION OF AGREEMENT.  THE PARTIES MAY TERMINATE THIS
AGREEMENT PRIOR TO THE CLOSING (WHETHER BEFORE OR AFTER REQUISITE APPROVAL), AS
PROVIDED BELOW:

 

(A)           THE PARTIES MAY TERMINATE THIS AGREEMENT BY MUTUAL WRITTEN
CONSENT;

 

(B)           THE BUYER MAY TERMINATE THIS AGREEMENT BY GIVING WRITTEN NOTICE TO
THE SELLERS IN THE EVENT THE SELLERS IS IN BREACH OF ANY REPRESENTATION,
WARRANTY OR COVENANT CONTAINED IN THIS AGREEMENT, AND SUCH BREACH, INDIVIDUALLY
OR IN COMBINATION WITH ANY OTHER SUCH BREACH, (I) WOULD CAUSE THE CONDITIONS SET
FORTH IN CLAUSES (B) OR (C) OF SECTION 5.2 NOT TO BE SATISFIED AND (II) IS NOT
CURED WITHIN 20 DAYS FOLLOWING DELIVERY BY THE BUYER TO THE SELLERS OF WRITTEN
NOTICE OF SUCH BREACH;

 

(C)           THE SELLERS MAY TERMINATE THIS AGREEMENT BY GIVING WRITTEN NOTICE
TO THE BUYER IN THE EVENT THE BUYER IS IN BREACH OF ANY REPRESENTATION, WARRANTY
OR COVENANT CONTAINED IN THIS AGREEMENT, AND SUCH BREACH, INDIVIDUALLY OR IN
COMBINATION WITH ANY OTHER SUCH BREACH, (I) WOULD CAUSE THE CONDITIONS SET FORTH
IN CLAUSES (B) OR (C) OF SECTION 5.3 NOT TO BE SATISFIED AND (II) IS NOT CURED
WITHIN 20 DAYS FOLLOWING DELIVERY BY THE SELLERS TO THE BUYER OF WRITTEN NOTICE
OF SUCH BREACH;

 

(D)           THE BUYER MAY TERMINATE THIS AGREEMENT BY GIVING WRITTEN NOTICE TO
THE SELLERS AT ANY TIME AFTER THE STOCKHOLDERS OF THE SELLERS HAVE VOTED ON
WHETHER TO APPROVE THE SALE/LEASE OF THE ACQUIRED ASSETS CONTEMPLATED BY THIS
AGREEMENT IN THE EVENT SUCH MATTER FAILED TO RECEIVE THE REQUISITE APPROVAL;

 

(E)           THE BUYER MAY TERMINATE THIS AGREEMENT BY GIVING WRITTEN NOTICE TO
THE SELLERS ON OR BEFORE APRIL 23, 2008 THAT IT IS NOT REASONABLY SATISFIED WITH
THE OUTCOME OF ITS DUE DILIGENCE.

 

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(F)            THE BUYER MAY TERMINATE THIS AGREEMENT BY GIVING WRITTEN NOTICE
TO THE SELLERS IF THE CLOSING SHALL NOT HAVE OCCURRED ON OR BEFORE JULY 1ST,
2008 BY REASON OF THE FAILURE OF ANY CONDITION PRECEDENT UNDER SECTION 5.1 OR
5.2 (UNLESS THE FAILURE RESULTS PRIMARILY FROM A BREACH BY THE BUYER OF ANY
REPRESENTATION, WARRANTY OR COVENANT CONTAINED IN THIS AGREEMENT)

 

(G)           THE SELLERS MAY TERMINATE THIS AGREEMENT BY GIVING WRITTEN NOTICE
TO THE BUYER IF THE CLOSING SHALL NOT HAVE OCCURRED ON OR BEFORE JULY 1ST, 2008
BY REASON OF THE FAILURE OF ANY CONDITION PRECEDENT UNDER SECTION 5.1 OR 5.3
(UNLESS THE FAILURE RESULTS PRIMARILY FROM A BREACH BY THE SELLERS OF ANY
REPRESENTATION, WARRANTY OR COVENANT CONTAINED IN THIS AGREEMENT).

 

8.2           EFFECT OF TERMINATION.  IF EITHER PARTY TERMINATES THIS AGREEMENT
PURSUANT TO SECTION 8.1, ALL OBLIGATIONS OF THE PARTIES HEREUNDER SHALL
TERMINATE WITHOUT ANY LIABILITY OF EITHER PARTY TO THE OTHER PARTY (EXCEPT FOR
ANY LIABILITY OF A PARTY FOR BREACHES OF THIS AGREEMENT).

 

ARTICLE IX

 

DEFINITIONS

 

For purposes of this Agreement, each of the following terms shall have the
meaning set forth below.

 

“Acquired Assets” shall mean all of Sellers’ right, title and interest in and to
all of the following tangible and intangible assets, properties and rights to
the extent owned, used or held for use by Sellers as of the Closing (but
specifically excluding the Excluded Assets):

 

(A)           ALL RIGHTS UNDER ANY ASSUMED CONTRACT;

 

(B)           A LEASEHOLD INTEREST IN THE FIXED ASSETS THROUGHOUT THE TERM OF
THE FACILITY LEASE AND AN OPTION TO PURCHASE THE FIXED ASSETS AFTER THE
EXPIRATION OF THE FACILITY LEASE IN ACCORDANCE WITH SECTION 6.10;

 

(C)           THE SERVICES OF ALL HIRED EMPLOYEES;

 

(D)           ALL INVENTORY; AND

 

(E)           THE BUYER RETAINED RECORDS AS DETAILED IN SECTION 6.5 (PROVIDED,
HOWEVER, THAT TO THE EXTENT THEY RELATE PRINCIPALLY TO THE SELLER RETAINED
LIABILITIES, BUYER SHALL RETAIN THEM FOR THE BENEFIT OF THE SELLER), LISTS
(INCLUDING CUSTOMER AND PROSPECT LISTS), SALES AND PROMOTIONAL MATERIALS
RELATING PRINCIPALLY TO THE ACQUIRED BUSINESS, STUDIES, REPORTS AND OTHER
PRINTED OR WRITTEN MATERIALS THAT, IN EACH CASE, RELATE TO THE ACQUIRED ASSETS.

 

“Acquired Business” shall mean the Sellers’s manufacturing center located in
Monterrey, Mexico, including the manufacturing, logistics, testing and delivery
services undertaken and technologies utilized by Sellers in connection with the
operations undertaken at such Facility.

 

“Affiliate” shall mean, with respect to any entity: any corporation,
partnership, limited liability company or partnership, association, trust or
other organization which, directly or

 

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indirectly, controls, is controlled by, or is under common control with, such
entity.  For purposes of the preceding sentence, “control” (including, with
correlative meanings, the terms “controlled by” and “under common control
with”), as used with respect to any entity or organization, shall mean the
possession, directly or indirectly, of the power (i) to vote more than 50% or
more of the securities having ordinary voting power for the election of
directors of the controlled entity or organization, or (ii) to direct or cause
the direction of the management and policies of the controlled entity or
organization,  whether through the ownership of voting securities or by contract
or otherwise.

 

“Agreed Amount” shall mean part, but not all, of the Claimed Amount.

 

“Ancillary Agreements” shall mean the, the Lease Agreement, the Transition
Services Agreement, the Manufacturing Agreement, the bill of sale and other
instruments of conveyance referred to in Section 1.4(b)(iii), and the instrument
of assumption and other instruments referred to in Section 1.4(b)(iv).

 

“Arbitration Rules” shall mean the Commercial Arbitration Rules of the American
Arbitration Association.

 

“Arbitrator” shall have the meaning set forth in Section 7.3(b)(iv).

 

“Assumed Contracts” shall mean the contracts, agreements or instruments to which
any of the Sellers is a party and which are expressly set forth on Schedule
1.1(a).

 

“Assumed Liabilities” shall mean the following liabilities:

 

(a)           liabilities under the Assumed Contracts;

 

(b)           liabilities under the Replacement Purchase Orders;

 

(c)           liabilities specifically assumed elsewhere under this Agreement
(e.g., those assumed under Section 6.7 and Article 7); and

 

(d)           seniority of the Hired Employees.

 

 “Beneficiary” means the person(s) designated by a Business Employee or former
employee of Sellers, by operation of law or otherwise, as entitled to
compensation, benefits, insurance coverage, payments or any other goods or
services under a Seller Plan.

 

“Business Employee” shall have the meaning set forth in Section 2.15.

 

“Buyer” shall have the meaning set forth in the first paragraph of this
Agreement, and for all representations and warranties relating to the IMMEX
program and/or employment matters, shall be deemed to include Buyer’s Mexican
Affiliate.

 

“Buyer’s Mexican Affiliate” shall mean Lenovo Centro Technologio, S.A. de C.V.

 

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“Buyer Certificate” shall mean a certificate to the effect that each of the
conditions specified in clauses (a) through (c) (insofar as clause (c) relates
to Legal Proceedings involving the Buyer) of Section 5.3 is satisfied in all
respects.

 

 “Claimed Amount” shall mean the amount of any Damages incurred or reasonably
expected to be incurred by the Indemnified Party.

 

“Claim Notice” shall mean written notification which contains (i) a description
of the Damages incurred or reasonably expected to be incurred by the Indemnified
Party and the Claimed Amount of such Damages, to the extent then known, (ii) a
statement that the Indemnified Party is entitled to indemnification under
ARTICLE VII for such Damages and a reasonable explanation of the basis therefor,
and (iii) a demand for payment in the amount of such Damages.

 

“Closing” shall mean the closing of the transactions contemplated by this
Agreement (and specifically the session at which signature pages are exchanged,
and the Initial Purchase Price is paid).

 

“Closing Date” shall mean June 4, 2008, or such other date as may be mutually
agreeable to the Parties.

 

 “Controlling Party” shall mean the party controlling the defense of any Third
Party Action.

 

“Damages” shall mean any and all debts, obligations and other actual and direct
(but not indirect or consequential) liabilities, monetary damages, fines, fees,
penalties, interest obligations, deficiencies, losses and expenses (including
amounts paid in settlement, interest, court costs, costs of investigators, fees
and expenses of attorneys, accountants, financial advisors and other experts,
and other expenses of litigation), other than those costs and expenses of
arbitration of a Dispute which are to be shared equally by the Indemnified Party
and the Indemnifying Party as set forth in Section 7.3(b)(iv)(F).

 

“Disclosure Schedule” shall mean the disclosure schedule provided by the Sellers
to the Buyer on the date hereof and accepted in writing by the Buyer.

 

“Dispute” shall mean the dispute resulting if the Indemnifying Party in a
Response disputes its liability for all or part of the Claimed Amount.

 

“Effective Time” shall mean 11:59 PM on the date following the Closing Date.

 

“Employee Benefit Plan” shall mean any written plan, agreement or arrangement
involving direct or indirect compensation, including insurance coverage,
severance benefits, disability benefits, deferred compensation, bonuses, stock
options, stock purchase, phantom stock, stock appreciation or other forms of
incentive compensation or post-retirement compensation, including any “employee
pension benefit plan”, any “employee welfare benefit plan”, if applicable.

 

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“Environmental Law” shall mean any federal, state or local law, statute, rule,
order, directive, judgment, Permit or regulation or the common law relating to
the environment, occupational health and safety, or exposure of persons or
property to Materials of Environmental Concern, including any statute,
regulation, administrative decision or order pertaining to:   (i) the presence
of or the treatment, storage, disposal, generation, transportation, handling,
distribution, manufacture, processing, use, import, export, labeling, recycling,
registration, investigation or remediation of Materials of Environmental Concern
or documentation related to the foregoing; (ii) air, water and noise pollution;
(iii) groundwater and soil contamination; (iv) the release, threatened release,
or accidental release into the environment, the workplace or other areas of
Materials of Environmental Concern, including emissions, discharges, injections,
spills, escapes or dumping of Materials of Environmental Concern; (v) transfer
of interests in or control of real property which may be contaminated;
(vi) community or worker right-to-know disclosures with respect to Materials of
Environmental Concern; (vii) the protection of wild life, marine life and
wetlands, and endangered and threatened species; (viii) storage tanks, vessels,
containers, abandoned or discarded barrels and other closed receptacles; and
(ix) health and safety of employees and other persons.

 

“Estimated Inventory Value” shall mean Sellers’s estimate of the Inventory Value
based upon the Preliminary Closing Inventory Listing.

 

“Excluded Assets” shall mean the following assets of the Sellers:

 

(a)           cash, cash equivalents, investments in cash, securities or
otherwise and all of Sellers bank accounts;

 

(b)           any account receivable of the Sellers;

 

(c)           all refunds of Taxes with respect to Taxes paid or accrued by
Sellers and not reimbursed or paid by Buyer;

 

(d)           all claims, actions, deposits, prepayments, refunds, causes of
action, choses in action, rights of recovery, rights of set off, and rights of
recoupment of any kind or nature (including any such item relating to Taxes) to
the extent attributable to anything other than the Acquired Assets or the
Assumed Liabilities;

 

(e)           all rights of the Sellers under this Agreement and any Ancillary
Agreements, or any other agreement, certificate, instrument or other document
executed and delivered by Sellers or Buyer in connection with the Transaction or
any side agreement between the Sellers and Buyer entered into on or after the
date hereof;

 

(f)            The Seller Retained Records as detailed in Section 6.5 (provided,
however, that to the extent they relate principally to the Acquired Business,
Seller shall retain them for the benefit of the Buyer), all Intellectual
Property rights of Sellers, including software, web sites and the trade name
Sanmina-SCI and derivatives thereof and logos associated therewith and all
related trademarks and service marks, and software licenses;

 

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(g)           all rights and licenses to Intellectual Property rights unless
specifically transferred to Buyer in an Ancillary Agreement.

 

(h)           all assets other than Acquired Assets, including but not limited
to land, buildings, leasehold improvements, information technology systems,
hardware and software (and other related intellectual property);

 

(i)            all capital stock, options and other securities of Sellers, and
all corporate minutes and stock books of account of Sellers, blank stock
certificates, qualifications to conduct business as a foreign corporation,
arrangements with registered agents relating to foreign qualifications, taxpayer
and other identification numbers, seals and other documents relating to the
organization, maintenance and existence of Sellers as corporations or other
entities;

 

(j)            all agreements and contracts to which any of the Sellers is a
party or is bound or to which any of its assets are subject that are not Assumed
Contracts; and

 

(k)           all assets or rights that relate to the Employee Plans of Sellers,
all Books and Records relating to the Employees of Sellers as of the Closing;

 

(l)            all claims, actions, deposits, prepayments, refunds, causes of
action, choses in action, rights of recovery, rights of set off, and rights of
recoupment of any kind or nature to the extent attributable to the Excluded
Claims;

 

(m)          leasehold improvements;

 

(n)           all claims and or other rights existing in favor of Sanmina-SCI as
of the Closing, including but not limited to any rights to recover sums in
ongoing DRAM or SRAM litigation matters.

 

“Expected Claim Notice” shall mean a notice that, as a result of a legal
proceeding instituted by or written claim made by a third party, an Indemnified
Party reasonably expects to incur Damages for which it is entitled to
indemnification under ARTICLE VII.

 

“Facility” shall mean the facility located at Av. de la Solidaridad
Iberoamericana No. 7020 Col. Club de Golf Atlas, El Salto, Jalisco, Mexico which
is the subject of the Facility Lease Agreement.

 

“Facility Lease Agreement” shall mean that certain between Buyer and Seller
dated February 22, 2008, and attached hereto as Exhibit C.

 

“Financial Statements” shall mean, in each case solely with respect to the
Acquired Business:

 

(A)   THE OPERATING EXPENSES FOR THE ACQUIRED BUSINESS DURING THE LAST 2.5
FISCAL YEARS, AND

 

(B)   OTHER SELECTED BALANCE SHEET INFORMATION.

 

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THE TERM “FINANCIAL STATEMENTS” SHALL IN NO EVENT REFER TO ANY STATEMENT WHICH
SHOWS THE PROFITABILITY OF THE ACQUIRED BUSINESS.

 

“FIXED ASSETS” SHALL MEAN COMPUTERS, MACHINERY, EQUIPMENT, SPARE PARTS,
FURNITURE, FIXTURES, SUPPLIES, AND OTHER TANGIBLE PERSONAL PROPERTY.

 

“Foxconn Transaction” shall mean the transaction contemplated by the Purchase
and Sale Agreement dated as of February 17, 2008 entered into by and between
Sanmina-SCI Corporation, Sanmina-SCI USA Inc., SCI Technology, Inc., Sanmina-SCI
Systems de Mexico S.A. de C.V., Sanmina-SCI Systems Services de Mexico S.A. de
C.V., Sanmina-SCI Hungary Electronics Manufacturing Limited Liability Company
and Sanmina-SCI Australia PTY LTD and Foxteq Holdings Inc.-Cayman (“Foxteq”).

 

GAAP” shall mean United States generally accepted accounting principles.

 

“Governmental Entity” shall mean any court, arbitrational tribunal,
administrative agency or commission or other governmental or regulatory
authority or agency.

 

“Hired Employee” shall have the meaning set forth in Section 6.6.

 

“Indemnified Party” shall mean a party entitled, or seeking to assert rights, to
indemnification under ARTICLE VII of this Agreement.

 

“Indemnifying Party” shall mean the party from whom indemnification is sought by
the Indemnified Party.

 

“Intellectual Property” shall mean all:

 

(A)  PATENTS, PATENT APPLICATIONS, PATENT DISCLOSURES AND ALL RELATED
CONTINUATION, CONTINUATION-IN-PART, DIVISIONAL, REISSUE, REEXAMINATION, UTILITY
MODEL, CERTIFICATE OF INVENTION AND DESIGN PATENTS, PATENT APPLICATIONS,
REGISTRATIONS AND APPLICATIONS FOR REGISTRATIONS;

 

(B)  TRADEMARKS, SERVICE MARKS, TRADE DRESS, INTERNET DOMAIN NAMES, LOGOS, TRADE
NAMES AND CORPORATE NAMES AND REGISTRATIONS AND APPLICATIONS FOR REGISTRATION
THEREOF;

 

(C)  COPYRIGHTS AND REGISTRATIONS AND APPLICATIONS FOR REGISTRATION THEREOF;

 

(D)  MASK WORKS AND REGISTRATIONS AND APPLICATIONS FOR REGISTRATION THEREOF;

 

(E)  COMPUTER SOFTWARE, DATA AND DOCUMENTATION, AND ANY RELATED RESEARCH AND
DEVELOPMENT DOCUMENTATION AND WHITE PAPERS;

 

(F)  INVENTIONS, TRADE SECRETS AND CONFIDENTIAL BUSINESS INFORMATION, WHETHER
PATENTABLE OR NONPATENTABLE AND WHETHER OR NOT REDUCED TO PRACTICE, KNOW-HOW,
MANUFACTURING AND PRODUCT PROCESSES AND TECHNIQUES, RESEARCH AND DEVELOPMENT
INFORMATION, COPYRIGHTABLE WORKS, FINANCIAL, MARKETING AND BUSINESS DATA,
PRICING AND COST INFORMATION, BUSINESS AND MARKETING PLANS AND CUSTOMER AND
SUPPLIER LISTS AND INFORMATION;

 

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(G)  OTHER PROPRIETARY RIGHTS RELATING TO ANY OF THE FOREGOING (INCLUDING
REMEDIES AGAINST INFRINGEMENTS THEREOF AND RIGHTS OF PROTECTION OF INTEREST
THEREIN UNDER THE LAWS OF ALL JURISDICTIONS); AND

 

(H)  COPIES AND TANGIBLE EMBODIMENTS THEREOF.

 

“Internal Systems” shall mean the internal systems of the Sellers that are used
in the Acquired Business, including manufacturing and testing systems and
computer hardware systems, software applications and embedded systems.

 

“Inventory” shall mean Sellers’s inventories of raw materials (including
equipment parts), work in process, finished goods, supplies and other personal
property held for sale or lease to Buyer pursuant to the Manufacturing Agreement
or (b) consumption in connection with performance of the Manufacturing
Agreement.

 

“Inventory Listing” shall mean a  listing of the Inventory (containing the part
number, quantity and price) prepared in a manner consistent with Sellers’s past
practices.

 

“Inventory Value” shall mean the book value of the Inventory as of the Closing
Date.

 

“Legal Proceeding” shall mean any action, suit, proceeding, claim, arbitration
or investigation before any Governmental Entity or before any arbitrator.

 

“Liabilities” shall mean any liabilities, indebtedness, obligations, accrued
expenses or contingencies, whether known or unknown, absolute or contingent,
liquidated or unliquidated, due or to become due and accrued or unaccrued.

 

“Materials of Environmental Concern” shall mean any: pollutants, contaminants or
hazardous substances, pesticides, solid wastes and hazardous wastes, chemicals,
other hazardous, radioactive or toxic materials, oil, petroleum and petroleum
products (and fractions thereof), or any other material (or article containing
such material) listed or subject to regulation under any law, statute, rule,
regulation, order, Permit, or directive due to its potential, directly or
indirectly, to harm the environment or the health of humans or other living
beings.

 

“Most Recent Balance Sheet” shall mean the unaudited consolidated balance sheet
of the Sellers as of the Most Recent Balance Sheet Date.

 

“Most Recent Balance Sheet Date” shall mean December 29, 2007.

 

“Non-controlling Party” shall mean the party not controlling the defense of any
Third Party Action.

 

“Ordinary Course of Business” shall mean the ordinary course of business
consistent with past custom and practice (including with respect to frequency
and amount).

 

“Parties” shall mean the Sellers and the Buyer.

 

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“Permits” shall mean all permits, licenses, registrations, certificates, orders,
approvals, franchises, variances and similar rights issued by or obtained from
any Governmental Entity (including those issued or required under Environmental
Laws and those relating to the occupancy or use of owned or leased real
property).

 

“Preliminary Closing Inventory Listing” has the meaning set forth in
Section 1.7.

 

 “Purchase Price” shall mean the purchase price to be paid by the Buyer for the
Acquired Assets at the Closing, as set forth in Section 1.3, as it may be
adjusted pursuant to Section 1.7.

 

“Reasonable Best Efforts” shall mean best efforts, to the extent commercially
reasonable.

 

“Requisite Approval” shall mean the approval of the sale of the Acquired Assets
by the Sellers to the Buyer as contemplated by this Agreement by a majority of
the outstanding shares of stock entitled to vote thereon.

 

“Response” shall mean a written response containing the information provided for
in Section 7.3(b)(ii).

 

 “Retained Liabilities” shall mean any and all Liabilities and any costs or
obligations attendant to the defense thereof, whether claims with respect
thereto are asserted before or after the Closing and whether contingent,
accrued, matured, known or unknown, of the Sellers or any of its affiliates
which are not expressly identified as Assumed Liabilities, including but not
limited to (i) any Liabilities arising on or prior to the Closing Date or
(ii) any Liabilities under any Assumed Contract that arises after the Closing
Date but that arise out of or relate to any breach of or noncompliance with such
Assumed Contract by Sellers that occurred prior to the Closing Date.

 

“Security Interest” shall mean any mortgage, pledge, security interest,
encumbrance, charge or other lien (whether arising by contract or by operation
of law), other than (i) mechanic’s, materialmen’s, and similar liens, (ii) liens
arising under worker’s compensation, unemployment insurance, social security,
retirement, and similar legislation and (iii) liens on goods in transit incurred
pursuant to documentary letters of credit, in each case arising in the Ordinary
Course of Business of the Sellers and not material to the Sellers.

 

“Sellers Certificate” shall mean a certificate to the effect that each of the
conditions specified in clause (a) of Section 5.1 and clauses (a) through
(d) (insofar as clause (d) relates to Legal Proceedings involving the Sellers)
of Section 5.2 is satisfied in all respects.

 

 “Material Adverse Effect” shall mean any material adverse change, event,
circumstance or development with respect to, or material adverse effect on,
(i) the Acquired Business, including the assets, liabilities, capitalization,
prospects, condition (financial or other), or results of operations of the
Sellers relating to the Acquired Business, or (ii) the ability of the Buyer to
operate the Acquired Business immediately after the Closing in the manner
operated by the Sellers prior to the Closing.

 

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“Seller Plan” shall mean any Employee Benefit Plan maintained, or contributed
to, by the Sellers or any Affiliate, but only to the extent to which the Seller
Plan relates to the Acquired Business; if any Seller has an Employee Benefit
Plan which relates to a business other than the Acquired Business, it shall not
be considered a Seller Plan.

 

 “Subsidiary” shall mean any corporation, partnership, trust, limited liability
company or other non-corporate business enterprise in which the Sellers (or
another Subsidiary) holds stock or other ownership interests representing
(a) more than 50% of the voting power of all outstanding stock or ownership
interests of such entity or (b) the right to receive more than 50% of the net
assets of such entity available for distribution to the holders of outstanding
stock or ownership interests upon a liquidation or dissolution of such entity.

 

“Taxes” shall mean all taxes, charges, fees, levies or other similar assessments
or liabilities, including income, gross receipts, ad valorem, premium,
value-added, excise, real property, personal property, sales, use, transfer,
withholding, employment, unemployment, insurance, social security, business
license, business organization, environmental, workers compensation, payroll,
profits, license, lease, service, service use, severance, stamp, occupation,
windfall profits, customs, duties, franchise and other taxes imposed by the
United States of America, Mexico or any state, local or foreign government, or
any agency thereof, or other political subdivision of the United States, Mexico
or any such government, and any interest, fines, penalties, assessments or
additions to tax resulting from, attributable to or incurred in connection with
any tax or any contest or dispute thereof.

 

“Tax Returns” shall mean all reports, returns, declarations, statements or other
information required to be supplied to a taxing authority in connection with
Taxes.

 

“Third Party Action” shall mean any suit or proceeding by a person or entity
other than a Party for which indemnification may be sought by a Party under
ARTICLE VII.

 

ARTICLE X

 

MISCELLANEOUS

 

10.1         PRESS RELEASES AND ANNOUNCEMENTS.  EXCEPT AS CONTEMPLATED HEREIN:

 

(A)           EACH PARTY SHALL KEEP STRICTLY CONFIDENTIAL THE TERMS OF THIS
AGREEMENT, THE OTHER ANCILLARY AGREEMENTS AND THE TRANSACTIONS CONTEMPLATED
HEREBY AND THEREBY;

 

(B)           EACH PARTY SHALL KEEP STRICTLY CONFIDENTIAL, AND SHALL NOT USE OR
DISCLOSE, ANY NON-PUBLIC DOCUMENT OR OTHER INFORMATION THAT RELATES DIRECTLY OR
INDIRECTLY TO THE BUSINESS OF THE OTHER PARTY OR ANY OF SUCH PARTY’S AFFILIATES;
AND

 

(C)           NEITHER PARTY SHALL ISSUE ANY PRESS RELEASE OR PUBLIC ANNOUNCEMENT
RELATING TO THE SUBJECT MATTER OF THIS AGREEMENT WITHOUT THE PRIOR WRITTEN
APPROVAL OF THE OTHER PARTY;

 

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PROVIDED, HOWEVER, THAT EITHER PARTY MAY MAKE ANY PUBLIC DISCLOSURE IT BELIEVES
IN GOOD FAITH IS REQUIRED BY APPLICABLE LAW, REGULATION OR STOCK MARKET RULE (IN
WHICH CASE THE DISCLOSING PARTY SHALL USE REASONABLE EFFORTS TO ADVISE THE OTHER
PARTY AND PROVIDE IT WITH A COPY OF THE PROPOSED DISCLOSURE PRIOR TO MAKING THE
DISCLOSURE).

 

10.2         NO THIRD PARTY BENEFICIARIES.  THIS AGREEMENT SHALL NOT CONFER ANY
RIGHTS OR REMEDIES UPON ANY PERSON OTHER THAN THE PARTIES AND THEIR RESPECTIVE
SUCCESSORS AND PERMITTED ASSIGNS.

 

10.3         ENTIRE AGREEMENT.  THIS AGREEMENT (INCLUDING THE DOCUMENTS REFERRED
TO HEREIN AND THE SCHEDULES REFERRED TO HEREIN) CONSTITUTES THE ENTIRE AGREEMENT
BETWEEN THE PARTIES AND SUPERSEDES ANY PRIOR UNDERSTANDINGS, AGREEMENTS, OR
REPRESENTATIONS BY OR BETWEEN THE PARTIES, WRITTEN OR ORAL, WITH RESPECT TO THE
SUBJECT MATTER HEREOF.  NOTWITHSTANDING THE FOREGOING, ANY CONFIDENTIALITY
AGREEMENT BETWEEN THE PARTIES EXECUTED PRIOR TO THE DATE HEREOF SHALL SURVIVE
THE EXECUTION AND DELIVERY OF THIS AGREEMENT AND SHALL TERMINATE IN FULL AT THE
CLOSING.

 

10.4         SUCCESSION AND ASSIGNMENT.  THIS AGREEMENT SHALL BE BINDING UPON
AND INURE TO THE BENEFIT OF THE PARTIES NAMED HEREIN AND THEIR RESPECTIVE
SUCCESSORS AND PERMITTED ASSIGNS. NEITHER PARTY MAY ASSIGN EITHER THIS AGREEMENT
OR ANY OF ITS RIGHTS, INTERESTS, OR OBLIGATIONS HEREUNDER WITHOUT THE PRIOR
WRITTEN APPROVAL OF THE OTHER PARTY; PROVIDED THAT THE BUYER MAY ASSIGN SOME OR
ALL OF ITS RIGHTS, INTERESTS AND/OR OBLIGATIONS HEREUNDER TO ONE OR MORE
AFFILIATES OF THE BUYER PROVIDED THAT BUYER SHALL REMAIN LIABLE FOR SUCH
AFFILIATES PERFORMANCE.

 

10.5         COUNTERPARTS AND FACSIMILE SIGNATURE.  THIS AGREEMENT MAY BE
EXECUTED IN TWO OR MORE COUNTERPARTS, EACH OF WHICH SHALL BE DEEMED AN ORIGINAL
BUT ALL OF WHICH TOGETHER SHALL CONSTITUTE ONE AND THE SAME INSTRUMENT.  THIS
AGREEMENT MAY BE EXECUTED BY FACSIMILE SIGNATURE.

 

10.6         HEADINGS.  THE SECTION HEADINGS CONTAINED IN THIS AGREEMENT ARE
INSERTED FOR CONVENIENCE ONLY AND SHALL NOT AFFECT IN ANY WAY THE MEANING OR
INTERPRETATION OF THIS AGREEMENT.

 

10.7         NOTICES.  ALL NOTICES, REQUESTS, DEMANDS, CLAIMS, AND OTHER
COMMUNICATIONS HEREUNDER SHALL BE IN WRITING.  ANY NOTICE, REQUEST, DEMAND,
CLAIM, OR OTHER COMMUNICATION HEREUNDER SHALL BE DEEMED DULY DELIVERED 4
BUSINESS DAYS AFTER IT IS SENT BY REGISTERED OR CERTIFIED MAIL, RETURN RECEIPT
REQUESTED, POSTAGE PREPAID, OR ONE BUSINESS DAY AFTER IT IS SENT FOR NEXT
BUSINESS DAY DELIVERY VIA A REPUTABLE NATIONWIDE OVERNIGHT COURIER SERVICE, IN
EACH CASE TO THE INTENDED RECIPIENT AS SET FORTH BELOW:

 

If to the Sellers:

Copy to:

 

 

Rob Walker

Steven H. Jackman

Vice President, Corporate Development

Vice President & Corporate Counsel

Sanmina-SCI Corporation

Sanmina-SCI Corporation

2700 N. First Street

2700 N. First Street

San Jose, CA 95134

San Jose, CA 95134

 

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Phone: (408) 964-3601

Phone: (408) 964-3617

Fax: (408) 964-3699

Fax: (408) 964-3888

 

 

rob.walker@sanmina-sci.com

steven.jackman@sanmina-sci.com

 

 

If to the Buyer:

Copy to:

 

 

Francisco Cano

Santiago Concha

Americas Manufacturing Exec

 

Lenovo Mexico

LatinAmerica General Counsel

Av. Santa Fe # 505, Piso 15

 

Mexico DF, CP: 05349

Lenovo Mexico

 

Av. Santa Fe # 505, Piso 15

Phone: 5255 5000 8500

Mexico DF, CP: 05349

 

 

 

Phone: 5255 5000 8559

fcano@lenovo.com

 

 

sconcha@lenovo.com

 

Either Party may give any notice, request, demand, claim, or other communication
hereunder using any other means (including personal delivery, expedited courier,
messenger service, telecopy, telex, ordinary mail) other than electronic mail,
but no such notice, request, demand, claim, or other communication shall be
deemed to have been duly given unless and until it actually is received by the
party for whom it is intended.  Either Party may change the address to which
notices, requests, demands, claims, and other communications hereunder are to be
delivered by giving the other Party notice in the manner herein set forth.

 

10.8         GOVERNING LAW.  THIS AGREEMENT (INCLUDING THE VALIDITY AND
APPLICABILITY OF THE ARBITRATION PROVISIONS OF THIS AGREEMENT, THE CONDUCT OF
ANY ARBITRATION OF A DISPUTE, THE ENFORCEMENT OF ANY ARBITRAL AWARD MADE
HEREUNDER AND ANY OTHER QUESTIONS OF ARBITRATION LAW OR PROCEDURE ARISING
HEREUNDER) SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF
MEXICO DF, WITHOUT GIVING EFFECT TO ANY CHOICE OR CONFLICT OF LAW PROVISION OR
RULE THAT WOULD  CAUSE THE APPLICATION OF LAWS OF ANY JURISDICTIONS OTHER THAN
THOSE OF MEXICO DF.

 

10.9         AMENDMENTS AND WAIVERS.  THE PARTIES MAY MUTUALLY AMEND ANY
PROVISION OF THIS AGREEMENT AT ANY TIME PRIOR TO THE CLOSING.  NO AMENDMENT OF
ANY PROVISION OF THIS AGREEMENT SHALL BE VALID UNLESS THE SAME SHALL BE IN
WRITING AND SIGNED BY EACH OF THE PARTIES.  NO WAIVER BY EITHER PARTY OF ANY
RIGHT OR REMEDY HEREUNDER SHALL BE VALID UNLESS THE SAME SHALL BE IN WRITING AND
SIGNED BY THE PARTY GIVING SUCH WAIVER.  NO WAIVER BY EITHER PARTY WITH RESPECT
TO ANY DEFAULT, MISREPRESENTATION, OR BREACH OF WARRANTY OR COVENANT HEREUNDER
SHALL BE DEEMED TO EXTEND TO ANY PRIOR OR SUBSEQUENT DEFAULT, MISREPRESENTATION,
OR BREACH OF WARRANTY OR COVENANT HEREUNDER OR AFFECT IN ANY WAY ANY RIGHTS
ARISING BY VIRTUE OF ANY PRIOR OR SUBSEQUENT SUCH OCCURRENCE.

 

39

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10.10       SEVERABILITY.  ANY TERM OR PROVISION OF THIS AGREEMENT THAT IS
INVALID OR UNENFORCEABLE IN ANY SITUATION IN ANY JURISDICTION SHALL NOT AFFECT
THE VALIDITY OR ENFORCEABILITY OF THE REMAINING TERMS AND PROVISIONS HEREOF OR
THE VALIDITY OR ENFORCEABILITY OF THE OFFENDING TERM OR PROVISION IN ANY OTHER
SITUATION OR IN ANY OTHER JURISDICTION.  IF THE FINAL JUDGMENT OF A COURT OF
COMPETENT JURISDICTION DECLARES THAT ANY TERM OR PROVISION HEREOF IS INVALID OR
UNENFORCEABLE, THE PARTIES AGREE THAT THE COURT MAKING THE DETERMINATION OF
INVALIDITY OR UNENFORCEABILITY SHALL HAVE THE POWER TO LIMIT THE TERM OR
PROVISION, TO DELETE SPECIFIC WORDS OR PHRASES, OR TO REPLACE ANY INVALID OR
UNENFORCEABLE TERM OR PROVISION WITH A TERM OR PROVISION THAT IS VALID AND
ENFORCEABLE AND THAT COMES CLOSEST TO EXPRESSING THE INTENTION OF THE INVALID OR
UNENFORCEABLE TERM OR PROVISION, AND THIS AGREEMENT SHALL BE ENFORCEABLE AS SO
MODIFIED.

 

10.11       EXPENSES.  EXCEPT AS SPECIFICALLY SET FORTH THIS AGREEMENT
(INCLUDING ARTICLE VII), EACH PARTY SHALL BEAR ITS OWN COSTS AND EXPENSES
(INCLUDING LEGAL FEES AND EXPENSES) INCURRED IN CONNECTION WITH THIS AGREEMENT
AND THE TRANSACTIONS CONTEMPLATED HEREBY.

 

10.12       SPECIFIC PERFORMANCE.  EACH PARTY ACKNOWLEDGES AND AGREES THAT THE
OTHER PARTY WOULD BE DAMAGED IRREPARABLY IN THE EVENT ANY OF THE PROVISIONS OF
THIS AGREEMENT (INCLUDING SECTIONS 6.1 AND 6.2) ARE NOT PERFORMED IN ACCORDANCE
WITH THEIR SPECIFIC TERMS OR OTHERWISE ARE BREACHED.  ACCORDINGLY, EACH PARTY
AGREES THAT THE OTHER PARTY SHALL BE ENTITLED TO AN INJUNCTION OR OTHER
EQUITABLE RELIEF TO PREVENT BREACHES OF THE PROVISIONS OF THIS AGREEMENT AND TO
ENFORCE SPECIFICALLY THIS AGREEMENT AND THE TERMS AND PROVISIONS HEREOF IN ANY
ACTION INSTITUTED IN ANY COURT OF THE UNITED STATES OR ANY STATE THEREOF HAVING
JURISDICTION OVER THE PARTIES AND THE MATTER, IN ADDITION TO ANY OTHER REMEDY TO
WHICH IT MAY BE ENTITLED, AT LAW OR IN EQUITY. NOTWITHSTANDING THE FOREGOING,
THE PARTIES AGREE THAT IF A DISPUTE IS SUBMITTED TO ARBITRATION IN ACCORDANCE
WITH SECTION 7.3(B)(III) AND SECTION 7.3(B)(IV), THEN THE FOREGOING PROVISIONS
OF THIS SECTION 10.13 SHALL NOT APPLY TO SUCH DISPUTE, AND THE PROVISIONS OF
SECTION 7.3(B)(III) AND SECTION 7.3(B)(IV) SHALL GOVERN AVAILABILITY OF
INJUNCTIVE RELIEF, SPECIFIC PERFORMANCE OR OTHER EQUITABLE RELIEF WITH RESPECT
TO SUCH DISPUTE.

 

10.13       CONSTRUCTION.

 

(A)           THE LANGUAGE USED IN THIS AGREEMENT SHALL BE DEEMED TO BE THE
LANGUAGE CHOSEN BY THE PARTIES TO EXPRESS THEIR MUTUAL INTENT, AND NO RULE OF
STRICT CONSTRUCTION SHALL BE APPLIED AGAINST EITHER PARTY.

 

(B)           ANY REFERENCE TO ANY FEDERAL, STATE, LOCAL, OR FOREIGN STATUTE OR
LAW SHALL BE DEEMED ALSO TO REFER TO ALL RULES AND REGULATIONS PROMULGATED
THEREUNDER, UNLESS THE CONTEXT REQUIRES OTHERWISE.

 

(C)           ANY REFERENCE HEREIN TO “INCLUDING” SHALL BE INTERPRETED AS
“INCLUDING WITHOUT LIMITATION.”

 

(D)           ANY REFERENCE TO ANY ARTICLE, SECTION OR PARAGRAPH SHALL BE DEEMED
TO REFER TO AN ARTICLE, SECTION OR PARAGRAPH OF THIS AGREEMENT, UNLESS THE
CONTEXT CLEARLY INDICATES OTHERWISE.

 

40

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IN WITNESS WHEREOF, the Parties have executed this Agreement as of the date
first above written.

 

 

SELLERS:

 

 

 

 

 

SANMINA-SCI USA, INC.

 

 

 

 

 

By:

/s/ Jure Sola

 

Name:  Jure Sola

 

Title:  Chairman and Chief Executive Officer

 

 

 

 

 

SANMINA-SCI SYSTEMS DE MEXICO S.A.
DE C.V.

 

 

 

 

 

By:

/s/ Jure Sola

 

Name:  Jure Sola

 

Title:  Chairman and Chief Executive Officer

 

 

 

 

 

SANMINA-SCI SYSTEMS SERVICES DE
MEXICO S.A. DE C.V.

 

 

 

 

 

By:

/s/ Jure Sola

 

Name: Jure Sola

 

Title: Chairman and Chief Executive Officer

 

Signature page for SELLERS

 

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BUYER:

 

 

 

 

 

LENOVO (SINGAPORE) PTE. LTD

 

 

 

By:

/s/ Damion Glendinning

 

Name:

Damion Glendinning

 

Title:  Director

 

 

 

 

 

LENOVO CENTRO TECNOLOGICO, SdeRL DE CV

 

 

 

 

 

By:

/s/ Francisco J. Cano

 

Name:

Francisco J. Cano

 

Title:  AG Manufacturing Executive Director

 

Signature page for BUYER

 

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Exhibits

 

 

 

Exhibit A-1

Invoice

Exhibit A-2

Invoice

Exhibit B

Instrument of Assumption

Exhibit C

Facility Lease

Exhibit D

Transition Services Agreement

 

 

Schedules

 

Schedule 1.1(a)

Assumed Contracts

Schedule 1.5

Allocation of Purchase Price among Acquired Assets

Schedule 5.2(i)

List of Employees Required to Have Accepted Offers

Schedule 6.2

List of Persons not to Hire

Disclosure Schedule

 

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