EXECUTION VERSION

 

 

 

 

 

ASSET PURCHASE AGREEMENT

 

by and between

 

OAKLEY, INC.

 

and

 

SBG REVO HOLDINGS, LLC

 

dated as of

 

August 2, 2013

 

 

 

 

 

 

 

 

 

 

TABLE OF CONTENTS

Page

 

Article I Definitions 1       Article II Purchase and Sale 7       Section 2.01
Purchase and Sale of Assets 7 Section 2.02 Excluded Assets 8 Section 2.03
Assumed Liabilities 9 Section 2.04 Excluded Liabilities 9 Section 2.05 Purchase
Price 11 Section 2.06 Allocation of Purchase Price 11 Section 2.07 Transfer of
Purchased Assets and Assumed Liabilities 11       Article III Closing 12      
Section 3.01 Closing 12 Section 3.02 Closing Deliverables 12 Section 3.03
Post-Closing Deliverables 13 Section 3.04 13       Article IV Representations
and Warranties of Seller 14       Section 4.01 Organization and Qualification of
Seller 14 Section 4.02 Authority of Seller 14 Section 4.03 No Conflicts;
Consents 14 Section 4.04 Absence of Certain Changes, Events and Conditions 15
Section 4.05 Material Contracts 15 Section 4.06 Intellectual Property 17 Section
4.07 Legal Proceedings; Governmental Orders 18 Section 4.08 Compliance With
Laws; Permits 18 Section 4.09 Taxes 18 Section 4.10 Employees 19 Section 4.11
Sufficiency of Assets 20 Section 4.12 Inventory 20 Section 4.13 Customers and
Suppliers 20 Section 4.14 Product Liability 20 Section 4.15 Brokers 21 Section
4.16 No Other Representations and Warranties 21       Article V Representations
and Warranties of Buyer 21     Section 5.01 Organization of Buyer 21 Section
5.02 Authority of Buyer 21 Section 5.03 No Conflicts; Consents 22 Section 5.04
Brokers 22 Section 5.05 Sufficiency of Funds 22

 

i

 

 

Section 5.06 Solvency 22 Section 5.07 Legal Proceedings 22 Section 5.08
Independent Investigation 23 Section 5.09 No Other Representations and
Warranties 23       Article VI Covenants   23       Section 6.01 Transaction
Documents 23 Section 6.02 Notification of Certain Matters 23 Section 6.03
Customer Letter; Public Announcements 23 Section 6.04 Bulk Sales Laws 24 Section
6.05 Transfer Taxes 24 Section 6.06 Tax Matters 24 Section 6.07 Covenant Not to
Sue 24 Section 6.08 Commercial Accounts and Customer Warranty Claims 25 Section
6.09 Further Assurances 25       Article VII Indemnification   26       Section
7.01 Survival 26 Section 7.02 Indemnification By Seller 26 Section 7.03
Indemnification By Buyer 27 Section 7.04 Certain Limitations 28 Section 7.05
Indemnification Procedures 29 Section 7.06 Seller’s Obligation to Cause
Affiliates to Act 32       Article VIII Miscellaneous   32       Section 8.01
Expenses 32 Section 8.02 Notices. 32 Section 8.03 Interpretation 33 Section 8.04
Headings 33 Section 8.05 Severability 33 Section 8.06 Entire Agreement 34
Section 8.07 Binding Effect; Successors and Assigns 34 Section 8.08 Amendment
and Modification; Waiver 34 Section 8.09 Governing Law; Submission to
Jurisdiction; Waiver of Jury Trial 34 Section 8.10 Specific Performance 35
Section 8.11 Knowledge 35 Section 8.12 Counterparts 35

 

ii

 

 

ASSET PURCHASE AGREEMENT

 

This Asset Purchase Agreement (this “Agreement”), dated as of August 2, 2013, is
entered into by and between OAKLEY, INC., a Washington corporation with its
principal office located at One Icon, Foothill Ranch, California 92610
(“Seller”), and SBG REVO HOLDINGS, LLC, a Delaware limited liability company
with its principal office located at 1065 Avenue of the Americas, 30th Floor,
New York, NY 10018 (“Buyer”).

 

RECITALS

 

WHEREAS, Seller is engaged in the Revo Business and Seller and its Affiliates
own or otherwise have the right to use certain assets related thereto; and

 

WHEREAS, Seller wishes, for itself and on behalf of its Affiliates, to sell and
assign to Buyer, and Buyer wishes to purchase and assume from Seller and its
Affiliates, certain assets and liabilities of the Revo Business, subject to the
terms and conditions set forth herein;

 

NOW, THEREFORE, in consideration of the mutual covenants and agreements
hereinafter set forth and for other good and valuable consideration, the receipt
and sufficiency of which are hereby acknowledged, the parties hereto agree as
follows:

 

Article I
Definitions

 

The following terms have the meanings specified or referred to in this Article
I:

 

“Affiliate” of a Person means any other Person that directly or indirectly,
through one or more intermediaries, controls, is controlled by, or is under
common control with, such Person. The term “control” (including the terms
“controlled by” and “under common control with”), for purposes of this
definition, and as used with respect to any Person, means the possession,
directly or indirectly, of the power to direct or cause the direction of the
management and policies of such Person, whether through the ownership of voting
securities, by Contract or otherwise. Notwithstanding anything to the contrary
contained in this Agreement, Luxottica Group and its Affiliates shall be deemed
to be Affiliates of Seller.

 

“Agreed Claims” has the meaning set forth in Section 7.05(c).

 

“Agreement” has the meaning set forth in the preamble.

 

“Allocation Schedule” has the meaning set forth in Section 2.06.

 

“Assigned Contracts” has the meaning set forth in Section 2.01(b).

 

“Assignment and Assumption Agreement” has the meaning set forth in Section
3.02(a).

 

“Assumed Liabilities” has the meaning set forth in Section 2.03.

 

1

 

  

“Bill of Sale” has the meaning set forth in Section 3.02(a).

 

“Business Day” means any day except Saturday, Sunday or any other day on which
commercial banks located in New York, New York are authorized or required by Law
to be closed for business.

 

“Buyer” has the meaning set forth in the preamble.

 

“Buyer Indemnitees” has the meaning set forth in Section 7.02.

 

“Claim Certificate” has the meaning set forth in Section 7.05(a).

 

“Closing” has the meaning set forth in Section 3.01.

 

“Closing Date” has the meaning set forth in Section 3.01.

 

“Code” means the United States Internal Revenue Code of 1986, as amended, and
the regulations promulgated and the rulings listed thereunder.

 

“Confidentiality Agreement” means the Confidentiality Agreement between Buyer
and Luxottica Group with an effective date of January 1, 2013.

 

“Contracts” means all contracts, leases, mortgages, licenses, instruments,
notes, commitments, undertakings, indentures, bonds, guarantees, franchises,
Permits, understandings, arrangements, letters of intent and other written
agreements, and any amendments thereto.

 

“Deductible” has the meaning set forth in Section 7.04(a).

 

“Design Patents” means all issued design patents and patent applications owned
by Seller or its Affiliates and directed to, claiming, or otherwise disclosing a
Revo Product or a feature or component thereof or used or held for use
exclusively in connection with the Revo Business, a complete and accurate list
of which is set forth in Section 4.06(a) of the Disclosure Schedules, and all
foreign counterparts, divisionals, continuations and continuations-in-part
thereof and any other applications which otherwise claims priority to any of the
foregoing.

 

“Direct Claim” has the meaning set forth in Section 7.05(c).

 

“Disclosure Schedules” means the Disclosure Schedules delivered by Seller and
Buyer concurrently with the execution and delivery of this Agreement.

 

“Displays” has the meaning set forth in Section 2.01(e).

 

“Dollars or $” means the lawful currency of the United States.

 

“Employees” means collectively any former or current employee, leased employee,
outsourced employee or temporary employee of Seller or any of its Affiliates.

 

“Encumbrance” means any lien, pledge, mortgage, deed of trust, security
interest, charge, claim, easement, encroachment, option, right of first refusal,
indenture, license or lease to a third party, security agreement or other
similar encumbrance or restriction or limitation on ownership or use of property
or irregularity in title thereto.

 

2

 

  

“Excluded Assets” has the meaning set forth in Section 2.02.

 

“Excluded Liabilities” has the meaning set forth in Section 2.04.

 

“Fundamental Representations” means collectively, those representations and
warranties contained in Section 4.01 (Organization and Qualification of Seller),
Section 4.02 (Authority of Seller), Section 4.03 (No Conflicts; Consents),
Section 4.06(a) (Intellectual Property), Section 4.15 (Brokers), Section 5.01
(Organization of Buyer), Section 5.02 (Authority of Buyer), Section 5.03 (No
Conflicts; Consents) and Section 5.04 (Brokers).

 

“Governmental Authority” means any United States or non-United States federal,
state, provincial or local government or political subdivision thereof, or any
agency, commission or instrumentality of such government or political
subdivision, or any self-regulated organization or other non-governmental
regulatory authority or quasi-governmental authority (to the extent that the
rules, regulations or orders of such organization or authority have the force of
Law), or any arbitrator, court or tribunal of competent jurisdiction or any
securities exchange.

 

“Governmental Order” means any order, writ, judgment, injunction, decree,
stipulation, determination or award entered by or with any Governmental
Authority.

 

“Indemnified Party” has the meaning set forth in Section 7.04.

 

“Indemnifying Party” has the meaning set forth in Section 7.04.

 

“Intellectual Property” means any and all of the following in any jurisdiction
throughout the world: (a) logos, brand names, slogans, trade names, trademarks
and service marks, trade dress, symbols, and other indicia of origin, whether
registered or unregistered, including all applications for registration and
registrations of any of the foregoing and all renewals thereof, and, the
goodwill connected with the use of and symbolized by any of the foregoing
(collectively, “Trademarks”); (b) copyrights, including all applications for
registration and registrations, and works of authorship, whether or not
copyrightable and whether registered or unregistered, and all moral and economic
and other similar rights of authors; (c) trade secrets and confidential
information, know-how, concepts, processes, methods, techniques, technology and
formulae; (d) inventions (whether or not patentable), patents and patent
applications, including divisionals, continuations, continuations-in-part and
foreign equivalents thereof; (e) websites, Internet domain names and related
registrations; (f) computer code and programs and all related documentation, and
all databases, database rights and compilations; (g) rights of publicity
(including all rights in a Person’s name, voice, signature, biography, likeness,
image and persona); and (h) all other intellectual property and industrial
property rights and assets, and all rights, interests and protections that are
associated with, similar to, or required for the exercise of, any of the
foregoing and all renewals, derivatives or improvements of the foregoing.

 

“Intellectual Property Assets” has the meaning set forth in Section 2.01(c).

 

3

 

  

“Inventory” has the meaning set forth in Section 2.01(a).

 

“Knowledge of Seller” has the meaning set forth in Section 8.11.

 

“Law” means any statute, law, ordinance, regulation, rule, code, order,
constitution, treaty, common law, judgment, decree, other requirement or rule of
law of any Governmental Authority.

 

“Legacy Endorsement Materials” has the meaning set forth in Section 2.02(j).

 

“Losses” means without duplication (a) any and all claims, actions, cause of
actions, judgment, awards, losses, damages, liabilities, costs or expenses,
including reasonable attorneys’, accountants’ and other professional advisors’
fees and expenses and (b) any losses or costs incurred in investigating,
defending or settling any claim, action or cause of action described in clause
(a) whether or not the underlying claim, action or cause of action is actually
asserted or is merely alleged or threatened.

 

“Luxottica Group” means Luxottica Group S.p.A., the ultimate parent of Seller.

 

“Luxottica Group Assignment” has the meaning set forth in Section 3.02(a).

 

“Material Adverse Effect” means any event, occurrence, fact, condition,
circumstance, development, effect or change that is materially adverse to (a)
the Purchased Assets, Assumed Liabilities, or the condition (financial or
otherwise) or results of operations of the Revo Business taken as a whole, or
(b) the ability of Seller to consummate the transactions contemplated hereby;
provided, however, that none of the following shall in and of itself constitute
a “Material Adverse Effect” or be considered in determining whether a “Material
Adverse Effect” has occurred and “Material Adverse Effect” shall not include any
event, occurrence, fact, condition, or change, solely arising out of or
attributable to: (i) any changes, conditions or effects in the United States or
foreign economies or securities or financial markets in general; (ii) economic
changes, conditions or effects that affect the sunglass industry in which the
Revo Business operates; (iii) the effect of any changes in applicable Laws; (iv)
the announcement of this Agreement; or (v) conditions caused by acts of
terrorism or war (whether or not declared) or any man-made disaster or acts of
God; other than, with respect to clauses (i), (ii), (iii) and (v), changes,
conditions, effects or circumstances that disproportionately and adversely
impact the Revo Business relative to other companies in the sunglass industry in
which the Revo Business operates.

 

“Material Contracts” has the meaning set forth in Section 4.05(a).

 

“Molds” has the meaning set forth in Section 2.01(d).

 

“Oakley Domain Name Assignment” has the meaning set forth in Section 3.02(a).

 

“Oakley Patent Assignment” has the meaning set forth in Section 3.02(a).

 

4

 

  

“Occurrence” shall mean any accident, happening or event which occurs or has
occurred at any time on or prior to the Closing Date that is caused or allegedly
caused by any defect in manufacture, design, materials or workmanship including
any failure or alleged failure to warn or any breach or alleged breach of
express or implied warranties or representations with respect to a product
manufactured, shipped, sold or delivered by or on behalf of Seller or any of its
Affiliates in connection with the Revo Business which results or is alleged to
have resulted in injury or death to any Person or damage to or destruction of
property (including damage to or destruction of the product itself).

 

“Overlap Period” shall mean any taxable year or other taxable period beginning
on or before and ending after the Closing Date.

 

“Permits” means all permits, licenses, franchises, approvals, certificates,
rights, exemptions, authorizations and consents granted from or issued by
Governmental Authorities.

 

“Permitted Encumbrances” means (a) liens for Taxes not yet due and payable or
being contested in good faith by appropriate procedures (in each case, for which
adequate reserves have been made with respect thereto) and (b) mechanics’,
carriers’, workmen’s, repairmen’s or other like liens arising or incurred in the
ordinary course of business securing amounts that are not past due.

 

“Person” means and includes an individual, corporation, partnership, joint
venture, limited liability company, Governmental Authority, unincorporated
organization, trust, association, limited liability partnership, limited
partnership, group or other entity.

 

“Pre-Closing Period” shall mean all taxable years or other taxable periods that
end on or before the Closing Date and, with respect to any Overlap Period, the
portion of such taxable year or period ending on and including the Closing Date.

 

“Purchase Price” has the meaning set forth in Section 2.05.

 

“Purchased Assets” has the meaning set forth in Section 2.01.

 

“Representative” means, with respect to any Person, any and all directors,
officers, employees, consultants, financial advisors, counsel, accountants,
agents, managers and other agents of such Person.

 

“Revo Business” means the design, manufacture, marketing, promotion, production,
distribution and sale in various locations throughout the world of Revo Product.

 

“Revo IP” has the meaning set forth in Section 4.06(b).

 

“Revo Product” means sunglasses, sunglass parts and cases, cleaning cloths, and
leash and buoy accessories using, bearing, embodying or sold under any
Transferred Mark.

 

“Revo Records” has the meaning set forth in Section 2.01(f).

 

“Seller” has the meaning set forth in the preamble.

 

“Seller Indemnitees” has the meaning set forth in Section 7.03.

 

5

 

  

“Seller Transaction Expenses” shall mean all expenses of Seller and its
Affiliates incurred or to be incurred in connection with the negotiation,
preparation and execution of this Agreement and the consummation of the
transactions contemplated hereby and the Closing, including out-of pocket costs,
fees and disbursements of financial advisors, attorneys, accountants and other
advisors and service providers, severance payments to directors, officers and
employees, bonuses, retention payments and any other change-of-control or
similar payments payable as a result of or in connection with the transactions
contemplated by this Agreement, payable by Seller or its Affiliates. The Seller
Transaction Expenses specifically include all expenses related to assignments or
transfers of Intellectual Property Assets made to Seller by Affiliates of the
Seller prior to Closing, including all legal expenses and filing fees for
recordation with applicable Governmental Authorities. The Seller Transaction
Expenses specifically exclude all expenses and filing fees related to Buyer’s
recordation of Intellectual Property Assets with applicable Governmental
Authorities after Closing.

 

“Shared Seller IP” shall mean all of the Revo IP other than the Intellectual
Property Assets. Shared Seller IP includes the Utility Patents.

 

“Special Damages” has the meaning set forth in Section 7.04(e).

 

“Supply Agreement” has the meaning set forth in Section 3.02(a).

 

“Tax Return” means any return, declaration, report, claim for refund,
information return or statement or other document required to be filed with
respect to Taxes, including any schedule or attachment thereto, and including
any amendment thereof.

 

“Taxes” means all federal, state, local, foreign and other income, gross
receipts, sales, use, value added, capital gain, capital stock, social security,
production, ad valorem, transfer, franchise, registration, profits, license,
lease, service, service use, withholding, payroll, employment, unemployment,
estimated, excise, severance, environmental, stamp, occupation, premium,
property (real or personal), real property gains, windfall profits, customs,
duties or other taxes, fees, assessments, levies, or other governmental charges
in the nature of a tax, together with any interest, additions or penalties with
respect thereto and any interest in respect of such additions or penalties, and
any liability for such amounts as a result of (a) being a transferee or
successor or member of a combined, consolidated, unitary or affiliated group, or
(b) a contractual obligation to indemnify any Person.

 

“Third Party Claim” has the meaning set forth in Section 7.05(a).

 

“Trademarks” has the meaning set forth in the definition of “Intellectual
Property”.

 

“Transaction Documents” means this Agreement, the Bill of Sale, Assignment and
Assumption Agreement, Supply Agreement, Oakley Patent Assignment, Luxottica
Group Assignment, Oakley Domain Name Assignment, Transition Letter Agreement and
the other agreements, instruments and documents required to be delivered at the
Closing.

 

“Transfer Regulations” has the meaning set forth in Section 4.10(a).

 

6

 

  

“Transferred Marks” mean the trade name or trademark REVO and all Trademarks,
websites and domain names owned by Seller or its Affiliates that include the
term “Revo”, and all Trademarks that are used exclusively in connection with the
Revo Business, including the Trademarks set forth in Section 4.06(a) of the
Disclosure Schedules.

 

“Transition Letter Agreement” has the meaning set forth in Section 3.02(a).

 

“Utility Patents” means the issued patents and patent applications owned by
Seller and directed to, claiming, or otherwise disclosing a Revo Product or a
feature or component thereof or used or held for use in connection with the Revo
Business that are also used in connection with other businesses or products of
Seller, which are set forth in Section 6.07 of the Disclosure Schedules, and all
foreign counterparts, divisionals, continuations and continuations-in-part
thereof and any other applications which otherwise claims priority to any of the
foregoing.

 

Article II
Purchase and Sale

 

Section 2.01        Purchase and Sale of Assets. Subject to the terms and
conditions set forth herein, at the Closing, Seller shall (and shall cause its
Affiliates to) sell, assign, transfer, convey and deliver (except with respect
to the timing of delivery of, but not the title to, the Inventory, Molds and
Displays as set forth in Section 3.03), and Buyer shall purchase, all of
Seller’s and its Affiliates’ right, title and interest in, to and under the
Purchased Assets free and clear of all Encumbrances of any kind whatsoever
except Permitted Encumbrances. “Purchased Assets” means the following assets
owned by Seller or its Affiliates:

 

(a) Sixty-Four Thousand (64,000) units of finished goods inventory of Revo
Product as set forth on Section 2.01(a) of the Disclosure Schedules (the
“Inventory”);

 

(b) all right, title and interest in the Contracts set forth on Section 2.01(b)
of the Disclosure Schedules (collectively, the “Assigned Contracts”);

 

(c) all Intellectual Property owned by Seller or any of its Affiliates that is
exclusively used or held for use in connection with the Revo Business, including
the Transferred Marks, the Design Patents, and the other Intellectual Property
set forth on Section 4.06(a) of the Disclosure Schedules, and all rights
thereunder, together with all goodwill associated therewith and all rights to
enforce such Intellectual Property with respect to past, present, and future
infringements and misappropriations thereof (the “Intellectual Property
Assets”);

 

(d) all molds, tools and dies that are or have been exclusively used or held for
use by Seller or any of its Affiliates in connection with the Revo Business (the
“Molds”);

 

(e) except for the Legacy Endorsement Materials, all samples, patterns, designs,
packaging, labels, containers, (including the shape and graphic designs),
artwork, photography, product books, design books, marketing displays, copy,
marketing, advertising and promotional materials (including websites, print and
online advertisements and marketing) that are or have been exclusively used or
held for use by Seller or any of its Affiliates in connection with the Revo
Business, including all historical archival or design materials (the
“Displays”);

 

7

 

  

(f) all books, records, files (whether in paper or electronic format) relating
to the Purchased Assets, including all prosecution histories and legal files in
the possession of Seller’s or its Affiliates’ legal departments related to or
concerning the Intellectual Property Assets, and all databases and data
exclusively related to the Revo Business, its suppliers, manufacturers or
contractors, or the Revo Products (together with, in the case of information
that is stored electronically, the media on which the same is stored)
(collectively, the “Revo Records”);

 

(g) to the extent transferable in compliance with applicable Law, all lists of
individual consumers (and such consumers’ information) that are or have been
used or held for use by Seller or its Affiliates exclusively in connection with
the Revo Business;

 

(h) all lists of commercial customers that are or have been used or held for use
by Seller or its Affiliates exclusively in connection with the Revo Business;

 

(h) to the extent transferrable, all express or implied warranties, indemnities
and guarantees in relation to any of the assets described in this Section 2.01;
and

 

(i) all goodwill associated with any of the assets described in the foregoing
clauses.

 

Section 2.02        Excluded Assets. Buyer expressly understands and agrees that
it is not purchasing or acquiring, and Seller is not selling or assigning, the
following properties, assets and other rights of Seller and its Affiliates, and
all such assets and properties shall be excluded from the Purchased Assets (the
“Excluded Assets”);

 

(a) all accounts or notes receivable of the Revo Business;

 

(b) all cash and cash equivalents, bank accounts and securities of Seller;

 

(c) all Contracts that are not Assigned Contracts;

 

(d) other than the Intellectual Property set forth on Section 4.06(a) of the
Disclosure Schedules, Intellectual Property owned or controlled by Seller that
is not used exclusively in connection with the Revo Business, including the
Utility Patents, notwithstanding that such Intellectual Property may be utilized
by or embedded in Revo Product;

 

(e) the corporate seals, organizational documents, minute books, stock books,
Tax Returns, books of account or other records having to do with the corporate
organization of Seller, all employee-related or employee benefit-related files
or records, and any other books and records which Seller is prohibited from
disclosing or transferring to Buyer under applicable Law and are required by
applicable Law to retain;

 

(f) all insurance policies of Seller and all rights to applicable claims and
proceeds thereunder;

 

(g) all Tax assets (including duty and Tax refunds and prepayments) of Seller or
any of its Affiliates that relate to the Revo Business or the Purchased Assets
and that are attributable to any Pre-Closing Period;

 

8

 

  

(h) all rights to any action, suit or claim of any nature available to or being
pursued by Seller as of the date hereof, whether arising by way of counterclaim
or otherwise related exclusively to any of the Excluded Assets or the Excluded
Liabilities;

 

(i) all assets, properties and rights used by Seller in its business that are
not used exclusively in the Revo Business;

 

(j) certain artwork, photography and marketing materials owned by endorsers of
the Revo Business prior to 2013 (other than Jimmy Chin) that Seller is not
permitted to assign to Buyer (the “Legacy Endorsement Materials”); and

 

(k) the rights which accrue or will accrue to Seller under the Transaction
Documents.

 

Section 2.03        Assumed Liabilities. Subject to the terms and conditions set
forth herein, Buyer shall assume and agree to pay, perform and discharge when
due the following liabilities and obligations of Seller to the extent solely and
exclusively arising out of or relating to the Purchased Assets accruing after
the Closing in respect of the period after the Closing Date, other than the
Excluded Liabilities (collectively, the “Assumed Liabilities”):

 

(a) except as set forth on Section 2.03(a) of the Disclosure Schedules, all
liabilities and obligations arising under or relating to the Assigned Contracts
in respect of periods after the Closing, provided, that Buyer shall not assume
or agree to pay, discharge or perform any liabilities or obligations arising out
of any breach by any Seller or any of their respective Affiliates of any
provision of any Assigned Contract;

 

(b) all liabilities and obligations for Taxes for which Buyer is liable pursuant
to Section 6.05;

 

(c) all customer warranty claims in respect of Revo Product manufactured after
the Closing Date by Buyer and/or its Affiliates and/or their respective
licensees (other than Seller or any of its Affiliates);

 

(d) all liabilities and obligations related to the prosecution of the Design
Patents and Trademarks described in Section 4.06(a) of the Disclosure Schedules
after the Closing; and

 

(e) all other liabilities and obligations under the Permitted Encumbrances on
the Purchased Assets as of the Closing arising out of or relating to Buyer’s
ownership or operation of the Revo Business and the Purchased Assets after the
Closing, other than Seller’s and its Affiliates’ liabilities and obligations
under the Transaction Documents.

 

Section 2.04        Excluded Liabilities. Notwithstanding anything contained
herein to the contrary, Buyer shall not assume or cause to be assumed, or be
deemed to have assumed and shall not be liable or responsible to pay, perform or
discharge any liabilities or obligations (whether known or unknown, fixed,
absolute, matured, unmatured, accrued or contingent, now existing or after the
date hereof) of Seller or any of its Affiliates, other than Assumed Liabilities
(collectively, the “Excluded Liabilities”), including the following:

 

9

 

  

(a) all trade or other accounts payable of Seller in connection with the Revo
Business as of the Closing Date;

 

(b) any liabilities or obligations arising out of or relating to Seller’s
ownership or operation of the Revo Business and the Purchased Assets on or prior
to the Closing Date (including all liabilities and obligations of Seller and its
Affiliates relating to the guaranty of third-party obligations by or
indemnification obligations of Seller and its Affiliates and all customer
warranty claims or other claims relating to Revo Product manufactured on or
prior to the Closing Date or sold by Seller or its Affiliates, in each case
whether asserted before, on or after the Closing Date);

 

(c) any liabilities or obligations relating to or arising out of the Excluded
Assets;

 

(d) any liabilities or obligations for Taxes relating to the Revo Business, the
Purchased Assets or the Assumed Liabilities for any Pre-Closing Period,
including the portion of the Overlap Period that ends on or before the Closing
Date;

 

(e) any liabilities or obligations relating to (i) any Employee, or (ii) any
labor, employment or social security matters relating to any such Employee,
including any liabilities or obligations arising out of or relating to any
payment obligation, withholding obligation, collective bargaining Contract,
labor negotiation, statutory benefits, pension plan, profit sharing plan,
deferred compensation plan, accrued holiday benefit, accrued bonus, salary,
bonus plan, phantom stock award, stock option or purchase plan, employment
Contract, consulting Contract, employee benefit plan, fines, Governmental Order,
severance cost, notice of termination, information and consulting obligations,
mass layoffs and redundancy obligations, or any entitlements arising as a result
of or in connection with the consummation of the transactions contemplated
hereby;

 

(f) any Taxes (i) attributable to the Purchased Assets or the Revo Business with
respect to any Pre-Closing Period, including the portion of the Overlap Period
that ends on or before the Closing Date or (ii) imposed on Oakley, Luxottica
Group or any of their respective Affiliates;

 

(g) any liabilities or obligations arising out of or relating to indebtedness of
any Seller or any of their respective Affiliates;

 

(h) any liabilities or obligations arising out of or relating to any Contract
which is not an Assigned Contract;

 

(i) intercompany accounts payable;

 

(j) the liabilities and obligations described on Section 2.03(a) of the
Disclosure Schedules;

 

(k) any liabilities or obligations related to the matters listed on Section
4.07(a) of the Disclosure Schedules or any other litigation, arbitration,
investigation, proceeding or claim pertaining to the Revo Business, the
Purchased Assets, Seller or any of its Affiliates to the extent based on a cause
of action arising prior to the Closing Date, whether the commencement of such
litigation, arbitration, investigation, proceeding or claim is before, on or
after the Closing Date;

 

10

 

  

(l) any Seller Transaction Expenses;

 

(m) all liabilities and obligations arising out of any breach under any
provision of any Assigned Contract; and

 

(n) any liabilities or obligations arising from product liability claims for
which the injury or loss giving rise thereto (not just the delivery of the
notice of such claims) occurs prior to the Closing Date, including specifically
all Losses caused by or arising out of any alleged defect in design or
manufacture of any products manufactured by the Revo Business prior to the
Closing Date, whether the commencement of any related litigation, arbitration,
investigation, proceeding or claim is before, on or after the Closing Date.

 

Section 2.05        Purchase Price. The aggregate purchase price for the
Purchased Assets and the entry into the Transaction Documents shall be the
amount set forth in Exhibit A hereto (the “Purchase Price”). The Purchase Price
shall be paid at Closing by wire transfer of immediately available funds to
accounts designated in writing by Seller to Buyer prior to the Closing.

 

Section 2.06        Allocation of Purchase Price. Prior to the date hereof,
Seller and Buyer shall mutually agree upon a schedule allocating the Purchase
Price (and the Assumed Liabilities that are properly allocable under Section
1060 of the Code) (the “Allocation Schedule”). The Allocation Schedule shall be
prepared in accordance with Section 1060 of the Code. Seller and Buyer agree to
file their respective IRS Form 8594 and all federal, state and local Tax Returns
in accordance with the Allocation Schedule, and to file timely any information
that may be required to be filed pursuant to treasury regulations promulgated
under Section 1060(b) of the Code.

 

Section 2.07        Transfer of Purchased Assets and Assumed Liabilities. At the
Closing, the Purchased Assets shall be sold, conveyed, transferred, assigned and
delivered (except with respect to the timing of the physical delivery of the
Inventory, Molds and Displays as set forth in Section 3.03) to Buyer, free and
clear of all Encumbrances except for Permitted Encumbrances, and the Assumed
Liabilities shall be assumed by Buyer, pursuant to transfer and assumption
Contracts, bills of sale in registrable form, endorsements, assurances,
conveyances, releases, discharges, assignments, certificates, drafts, checks or
other instruments in such form as is necessary to effect a sale, conveyance,
transfer and assignment of the Purchased Assets and an assumption of the Assumed
Liabilities in the jurisdictions in which such transfers are to be made, as
Buyer shall reasonably deem necessary, or as required by Law in order to
consummate the transaction and to vest in Buyer good and marketable title to the
Purchased Assets free and clear of any Encumbrances except for Permitted
Encumbrances, which documents and instruments shall be executed (upon the terms
and subject to the conditions hereof) on the Closing Date by Seller (and, as
applicable, Luxottica Group and its Affiliates) and Buyer.

 

11

 

  

Article III
Closing

 

Section 3.01        Closing. Subject to the terms and conditions of this
Agreement, the consummation of the transactions contemplated by this Agreement
(the “Closing”) shall take place on the date hereof (the “Closing Date”).

 

Section 3.02        Closing Deliverables.

 

(a) At the Closing, Seller shall deliver (or cause to be delivered) to Buyer the
following:

 

(i)                 a bill of sale in the form of Exhibit B hereto (the “Bill of
Sale”), duly executed by Seller;

 

(ii)               an assignment and assumption agreement in the form of Exhibit
C hereto (the “Assignment and Assumption Agreement”), duly executed by Seller;

 

(iii)             a License and Supply Agreement in the form of Exhibit D hereto
(the “Supply Agreement”), duly executed by Seller and Sunglass Hut Trading, LLC,
an Affiliate of Seller;

 

(iv)             an Assignment of Patents in the form of Exhibit E hereto, which
assignment shall transfer to Buyer all Design Patents owned by Seller that are
included in the Intellectual Property Assets (the “Oakley Patent Assignment”),
duly executed by Seller;

 

(v)               an Assignment of Intellectual Property in the form of Exhibit
F hereto, which assignment shall transfer to Buyer all Transferred Marks and all
Design Patents owned by Luxottica Group that are included in the Intellectual
Property Assets (the “Luxottica Group Assignment”), duly executed by Luxottica
Group;

 

(vi)             an Assignment of Domain Names in the form of Exhibit G hereto,
which assignment shall transfer to Buyer all Internet domain names owned by
Seller that are included in the Intellectual Property Assets (the “Oakley Domain
Name Assignment”), duly executed by Seller; and

 

(vii)           the Transition Letter Agreement in the form of Exhibit H hereto
(the “Transition Letter Agreement”), duly executed by Seller; and

 

(viii)         such other customary instruments of transfer, assumption, filings
or documents, in form and substance reasonably satisfactory to Buyer, as may be
required to give effect to this Agreement.

 

(b) At the Closing, Buyer shall deliver (or cause to be delivered) to Seller
(or, as applicable, Luxottica Group) the following:

 

(i)                 an amount in cash equal to the Purchase Price, payable by
wire transfer of immediately available funds in accordance with Exhibit A;

 

12

 

  

(ii)               evidence obtained by Buyer from IDB Bank pertaining to the
initiation and confirmation of the wire transfer(s) of the Purchase Price, such
evidence to be satisfactory to Seller;

 

(iii)             the Assignment and Assumption Agreement duly executed by
Buyer;

 

(iv)             the Supply Agreement duly executed by Buyer;

 

(v)               the Oakley Patent Assignment duly executed by Buyer;

 

(vi)             the Luxottica Group Assignment duly executed by Buyer;

 

(vii)           the Oakley Domain Name Assignment duly executed by Buyer;

 

(viii)         the Transition Letter Agreement duly executed by Buyer; and

 

(ix)             such other customary instruments of transfer, assumption,
filings or documents, in form and substance reasonably satisfactory to Seller,
as may be required to give effect to this Agreement.

 

Section 3.03        Post-Closing Deliverables. Section 3.04

 

(a) No later than September 30, 2013, Seller shall deliver to Buyer (or Buyer’s
designee as specified by Buyer) the Inventory, which shall be shipped, at
Buyer’s sole expense, to a location designated by Buyer.

 

(b) No later than September 30, 2013, Seller shall deliver to Buyer (or Buyer’s
designee as specified by Buyer) all Molds pertaining to non-active skus of Revo
Product, which shall be shipped, at Buyer’s sole expense, to a location
designated by Buyer.

 

(c) No later than the nine (9) month anniversary of the Closing Date, Seller
shall deliver to Buyer (or Buyer’s designee as specified by Buyer) all Molds
pertaining to active skus of Revo Product, which shall be shipped, at Buyer’s
sole expense, to a location designated by Buyer. Seller and Buyer agree that all
Molds pertaining to active skus of Revo Product shall be owned by Buyer on the
Closing Date but shall remain in the possession of Seller for a period not to
exceed nine (9) months after the Closing Date in order for Seller to manufacture
Revo Product pursuant to the Supply Agreement.

 

(d) No later than September 30, 2013, Seller shall deliver to Buyer (or Buyer’s
designee as specified by Buyer) the Displays, of which (i) the Displays located
at various customer locations or online shall not be shipped to Buyer but shall
become the property of Buyer, and (ii) the Displays in Seller’s corporate
inventory shall be shipped, at Buyer’s sole expense, to a location designated by
Buyer.

 

13

 

  

Article IV
Representations and Warranties of Seller

 

Except as set forth in the Disclosure Schedules, Seller represents and warrants
to Buyer that the statements contained in this Article IV are true and correct
as of the date hereof.

 

Section 4.01        Organization and Qualification of Seller. Seller is a
corporation duly organized, validly existing and in good standing under the Laws
of the state of Washington. Seller and its Affiliates have all necessary
corporate and other power and authority to own the assets now owned by Seller
and its Affiliates and to carry on the Revo Business as currently conducted.
Seller and its Affiliates are duly licensed or qualified to do business and are
in good standing in each jurisdiction in which the ownership of the Purchased
Assets or the operation of the Revo Business as currently conducted makes such
licensing or qualification necessary, except where the failure to be so
licensed, qualified or in good standing has not had and would not reasonably be
expected to have, individually or in the aggregate, a Material Adverse Effect.

 

Section 4.02        Authority of Seller. Seller and its Affiliates have all
necessary corporate and other power and authority to enter into this Agreement
and the other Transaction Documents to which Seller and/or such Affiliate is a
party, to carry out their respective obligations hereunder and thereunder and to
consummate the transactions contemplated hereby and thereby. The execution and
delivery by Seller and its Affiliates of this Agreement and any other
Transaction Document to which Seller and/or such Affiliate is a party, the
performance by Seller and its Affiliates of their respective obligations
hereunder and thereunder and the consummation by Seller and its Affiliates of
the transactions contemplated hereby and thereby have been duly authorized by
all requisite corporate or other action on the part of Seller and its
Affiliates. This Agreement has been duly executed and delivered by Seller, and
(assuming due authorization, execution and delivery by Buyer) this Agreement
constitutes a legal, valid and binding obligation of Seller, enforceable against
Seller in accordance with its terms, except as such enforceability may be
limited by bankruptcy, insolvency, reorganization, moratorium or similar Laws
affecting creditors’ rights generally and by general principles of equity
(regardless of whether enforcement is sought in a proceeding at law or in
equity). At the Closing, each Transaction Document shall have been duly executed
and delivered by Seller and its Affiliates, as applicable, and (assuming due
authorization, execution and delivery by Buyer) each such Transaction Document
shall constitute a legal, valid and binding obligation of Seller and/or such
Affiliate, enforceable against Seller and/or such Affiliate in accordance with
its terms, except as such enforceability may be limited by bankruptcy,
insolvency, reorganization, moratorium or similar Laws affecting creditors’
rights generally and by general principles of equity (regardless of whether
enforcement is sought in a proceeding at law or in equity).

 

Section 4.03        No Conflicts; Consents. The execution, delivery and
performance by Seller and its Affiliates of this Agreement and the other
Transaction Documents to which Seller and/or such Affiliate is a party, and the
consummation of the transactions contemplated hereby and thereby, do not and
will not: (a) result in a violation or breach of or conflict with any provision
of the certificate of incorporation or by-laws (or equivalent organizational
documents) of Seller or such Affiliates, in each case, amended to the date of
this Agreement; (b) create any Encumbrance (other than a Permitted Encumbrance)
upon any Purchased Asset; (c) result in a violation or breach of or conflict
with any provision of any Law or Governmental Order applicable to Seller, any of
such Affiliates, the Revo Business or the Purchased Assets; or (d) except as set
forth in Section 4.03 of the Disclosure Schedules, require the consent, notice
or other action by any Person under, conflict with, result in a violation or
breach of, constitute a default under or result in the acceleration of any
Material Contract. No consent, approval, Permit, or Governmental Order of,
declaration or filing with, or notice to, any Governmental Authority is required
by or with respect to Seller or any of its Affiliates in connection with the
execution and delivery of this Agreement or any of the other Transaction
Documents and the consummation of the transactions contemplated hereby and
thereby. Seller and its Affiliates have obtained all consents and approvals set
forth in Section 4.03 of the Disclosure Schedules and no other consents or
approvals of any Person are necessary for the execution and delivery of this
Agreement and the other Transaction Documents and the consummation of the
transactions contemplated hereby and thereby, including the transfer of all the
Purchased Assets.

 

14

 

  

Section 4.04        Absence of Certain Changes, Events and Conditions. Except as
set forth on Section 4.04 of the Disclosure Schedules, since January 1, 2013,
Seller has operated the Revo Business in the ordinary course of business in all
material respects and there has not been, with respect to the Revo Business,
any:

 

(a) incurrence of any indebtedness for borrowed money exclusively in connection
with the Revo Business, except unsecured current obligations and liabilities
incurred in the ordinary course of business;

 

(b) sale, assignment, abandonment, cancellation, transfer, license or other
disposition of any of the Purchased Assets, except for the sale of inventory in
the ordinary course of business;

 

(c) imposition of any Encumbrance upon any of the Purchased Assets, except for
Permitted Encumbrances; or

 

(d) event, circumstance, development, state of facts, occurrence, change or
effect which has had or would reasonably be expected to have, individually or in
the aggregate, a Material Adverse Effect.

 

Section 4.05        Material Contracts.

 

(a) Section 4.05(a) of the Disclosure Schedules sets forth an accurate and
complete list as of the date hereof of each of the following Contracts (x) by
which any of the Purchased Assets or Assumed Liabilities are bound or affected
or (y) to which Seller or any of its Affiliates are parties or by which Seller
or any of its Affiliates are bound in connection with the Revo Business, the
Purchased Assets or the Assumed Liabilities (all such Contracts required to be
set forth on Section 4.05(a) of the Disclosure Schedules, collectively, the
“Material Contracts”):

 

(i)                 all Contracts relating to the Revo Business involving
aggregate consideration in excess of Twenty-Five Thousand Dollars ($25,000) or
requiring performance by any party more than one (1) year from the date hereof,
which, in each case, cannot be cancelled without penalty or without more than
sixty (60) days’ notice;

 

15

 

  

(ii)               all Contracts that relate to the sale of any of the Purchased
Assets, other than sales of inventory in the ordinary course of business;

 

(iii)             except for agreements relating to trade receivables, all
Contracts relating to indebtedness (including guarantees) related exclusively to
the Revo Business;

 

(iv)             all Contracts granting or evidencing an Encumbrance on any
Purchased Asset or any other property or asset of Seller or any of its
Affiliates and used in connection with the Revo Business, other than a Permitted
Encumbrance;

 

(v)               all Contracts limiting the ability of Seller or any of its
Affiliates to (A) engage in the Revo Business or to use any Intellectual
Property Assets in any capacity or (B) compete with any Person or in any
geographical area with respect to the Revo Business;

 

(vi)             all Contracts relating to the Revo Business (other than this
Agreement and any agreement or instrument entered into pursuant to this
Agreement) with (A) Seller or any of its Affiliates or (B) Seller or any of its
Affiliates or any current or former officer or director of Seller or any of its
Affiliates;

 

(vii)           all Assigned Contracts; and

 

(viii)         all Contracts involving any joint venture, partnership, strategic
alliance, shareholders’ agreement, co-marketing, co-promotion, co-packaging,
joint development or similar arrangement.

 

(b) Other than the Material Contracts, there are no Contracts which license any
of the Intellectual Property Assets, including the Transferred Marks, to any
other Person or allow any Person to procure, distribute, import or sell any Revo
Product. Except as set forth on Section 4.05(b) of the Disclosure Schedules,
neither Seller nor any of its Affiliates is in breach of, and there exists no
default or event of default, nor any event, occurrence, condition or act
(including the transactions contemplated hereby) which, with the giving of
notice, the lapse of time or the happening of any other event or condition,
would become a default or event of default thereunder with respect to any
Material Contract other than any such default, event of default, event,
occurrence, condition or act which has not had and would not reasonably be
expected to have, individually or in the aggregate, a Material Adverse Effect.
Each Material Contract has not been terminated or been repudiated by any party
thereto. Each Material Contract is in full force and effect and is the legal,
valid and binding obligation of Seller and its Affiliates, as applicable, and
each of the other parties thereto, enforceable in accordance with the terms
thereof, except to the extent that its enforceability may be subject to
applicable bankruptcy, insolvency, fraudulent conveyance, reorganization,
moratorium and other similar Laws relating to or affecting creditors’ rights
generally, general equitable principles (whether considered in a proceeding in
equity or at law) and implied covenant of good faith and fair dealing. All the
covenants to be performed by Seller or its Affiliates under any Material
Contract have been fully performed in all material respects. To the Knowledge of
Seller, all of the covenants to be performed by any other party to any Material
Contract have been fully performed in all material respects.

 

16

 

  

Section 4.06        Intellectual Property.

 

(a) Section 4.06(a) of the Disclosure Schedules contains a complete and accurate
list of all Design Patents and all other patents, patent applications,
registered copyrights and applications for registration thereof, registered
trademarks and service marks and applications for registration thereof, Internet
domain names, and all Transferred Marks not subject to a registration or
application for registration thereof that are included in the Intellectual
Property Assets. Seller or Luxottica Group owns, free and clear of all
Encumbrances, all Intellectual Property Assets set forth on such schedule. To
the extent indicated on such schedule, the Intellectual Property Assets listed
on Section 4.06(a) of the Disclosure Schedules have been duly registered in,
filed in or issued by the United States Patent and Trademark Office, the United
States Copyright Office, a duly accredited and appropriate domain name
registrar, or the appropriate Governmental Authorities of other jurisdictions
(foreign and domestic).

 

(b) Except as set forth in Section 4.06(b) of the Disclosure Schedules, Seller
or Luxottica Group owns, free and clear of all Encumbrances, or has the right to
use all Intellectual Property owned, used or held for use by Seller and/or its
Affiliates on or prior to the Closing Date in connection with the Revo Business
(the “Revo IP”). Except for the Shared Seller IP, including the Utility Patents,
the Intellectual Property Assets represent the Intellectual Property necessary
to manufacture, distribute and sell Revo Product consistent with Revo Product
manufactured, distributed and sold as of Closing and conduct the Revo Business
in substantially the same manner as currently conducted. Other than the Utility
Patents and the Design Patents, there are no patents or patent applications
owned by Seller or any of its Affiliates that are or would otherwise be
infringed by a Revo Product or the conduct of the Revo Business prior to or as
of the Closing.

 

(c) Except as set forth in Section 4.06(c) of the Disclosure Schedules, (i) the
conduct of the Revo Business and the use of the Intellectual Property Assets
(including the manufacturing, marketing, licensing, sale or distribution of Revo
Product) do not infringe, violate, dilute or misappropriate the Intellectual
Property of any Person; and (ii) neither Seller nor its Affiliates have received
any notice or claim (including threats or offers to license and cease and desist
communications) from any Person challenging the right of the Seller or its
Affiliates, manufacturers, contractors or licensees to use any of the
Intellectual Property Assets, Seller’s or its Affiliates’ ownership or the
validity or enforceability of the Intellectual Property Assets, or alleging any
infringement, misappropriation, or violation of any Person’s Intellectual
Property rights in connection with the Revo Business; and (iii) neither Seller
nor its Affiliates have asserted any claim of a violation, infringement,
misappropriation or misuse by any Person of any Intellectual Property Assets. To
the Knowledge of Seller, except as set forth in Section 4.06(c) of the
Disclosure Schedules, no Person is infringing, violating, misappropriating or
misusing any Intellectual Property Assets.

 

(d) Except as set forth in Section 4.06(d) of the Disclosure Schedules, Seller
and its Affiliates are not aware of any third party uses of the mark REVO or a
term confusingly similar thereto, which might reasonably be found to prevent or
restrict Buyer or its licensees in using the Transferred Marks in connection
with goods and services in international trademark class 9 in any particular
country.

 

17

 

  

(e) Except pursuant to the Contracts listed in Section 4.06(e) of the Disclosure
Schedules, the Seller and its Affiliates have not entered into any Contract to
indemnify any other Person in connection with the Revo Business, the
Intellectual Property Assets or any Revo IP against any charge of infringement,
misappropriation or violation of any Intellectual Property rights. Other than
the Assigned Contracts, there are no Contracts containing any license or rights
concerning Intellectual Property used or held for use exclusively in connection
with the Revo Business.

 

Section 4.07        Legal Proceedings; Governmental Orders.

 

(a) Except as set forth in Section 4.07(a) of the Disclosure Schedules, there
are no actions, suits, claims, investigations, audits or other legal proceedings
(including arbitration or administrative proceedings, interferences,
cancellation proceedings, oppositions or other contested proceedings), at law or
in equity, pending or, to the Knowledge of Seller, threatened against or by
Seller or any of its Affiliates either (i) relating to the Revo Business, the
Purchased Assets or the Assumed Liabilities or (ii) that challenge or seek to
prevent, enjoin or otherwise delay the transactions contemplated by this
Agreement.

 

(b) Except as set forth in Section 4.07(b) of the Disclosure Schedules, there
are no outstanding Governmental Orders and no unsatisfied judgments, penalties
or awards against or affecting the Revo Business, the Purchased Assets or the
Assumed Liabilities.

 

Section 4.08        Compliance With Laws; Permits.

 

(a) Except as set forth in Section 4.08(a) of the Disclosure Schedules, Seller
is in material compliance with all Laws applicable to the conduct of the Revo
Business as currently conducted or the ownership and use of the Purchased
Assets.

 

(b) All material Permits used in, necessary, advisable or required to conduct
the Revo Business as currently conducted or for the ownership and use of the
Purchased Assets have been obtained by Seller and are in the possession of
Seller, and Seller has made all registrations or filings with, or notices to any
Governmental Authority or any other Person necessary or advisable for the lawful
conduct of the Revo Business or necessary or advisable for the lawful ownership
of the Purchased Assets. No proceeding to modify, suspend, revoke, withdraw,
terminate or otherwise limit any such Permit is pending, or, to the Knowledge of
Seller, threatened and Seller does not know of any valid basis for such
proceeding, including the transactions contemplated hereby.

 

Section 4.09        Taxes.

 

Except as set forth in Section 4.09 of the Disclosure Schedules,

 

(a) Seller and its Affiliates have timely filed, or will timely file (taking
into account any valid extensions), all Tax Returns with respect to the Revo
Business or the Purchased Assets required to be filed on or prior to the Closing
Date. Neither Seller nor any of its Affiliates is currently the beneficiary of
any extension of time within which to file any material Tax Return other than
extensions of time to file Tax Returns obtained in the ordinary course of
business.

 

18

 

  

(b) All material Taxes and Tax liabilities due and payable on or prior to the
Closing Date by or with respect to the income or operations of the Revo Business
or the Purchased Assets for all Pre-Closing Periods have been timely paid or
will be timely paid in full.

 

(c) (A) Neither Seller nor any of its Affiliates has been the subject of an
audit or other examination of Taxes by the tax authorities of any nation, state
or locality with respect to the Revo Business or the Purchased Assets; (B) no
such audit is contemplated in writing or pending; and (C) neither Seller nor its
Affiliates has received any written notices from any taxing authority relating
to any issue that could affect any Tax liability with respect to the income or
operations of the Revo Business or the Purchased Assets.

 

(d) Neither Seller nor its Affiliates (A) has entered into a contract or waiver
or been requested to enter into a contract or waiver extending any statute of
limitations relating to the payment or collection of Taxes with respect to the
income or operations of the Revo Business or the Purchased Assets that has not
expired (other than extensions of time to file Tax Returns obtained in the
ordinary course), or (B) is presently contesting the Tax liability with respect
to the income or operations of the Revo Business or the Purchased Assets before
any Governmental Authority.

 

(e) All material Taxes that Seller or any of its Affiliates is (or was) required
by Law to withhold or collect with respect to the income or operations of the
Revo Business or the Purchased Assets in connection with amounts paid or owing
to any employee, independent contractor, creditor, equity holder or other third
party have been duly withheld or collected, and have been timely paid over to
the proper authorities to the extent due and payable.

 

(f) None of the Purchased Assets is an equity interest in a partnership or a
corporation (or an entity treated as a partnership or a corporation) for U.S.
federal income tax purposes.

 

(g) The representations and warranties set forth in this Section 4.09 are
Seller’s sole and exclusive representations and warranties regarding Tax
matters.

 

Section 4.10        Employees.

 

(a) Neither Seller nor its Affiliates have any Employees who will transfer with
the Purchased Assets to Buyer or any of its Affiliates by operation of law,
under any applicable Transfer Regulations or individual or collective bargaining
Contract, or who are otherwise entitled by Law to be offered employment with
Buyer or any of its Affiliates, as a result of or in connection with the
consummation of the transactions contemplated hereby. “Transfer Regulations”
shall mean (i) in relation to any member state of the European Union, the
Council Directive 2001/23/EC of 12 March 2001, as amended, reenacted, extended
or consolidated from time to time and any national Law transposing or
implementing it, and (ii) in relation to any other jurisdiction, any national or
local Law that provides for the transfer of employment upon the transfer and/or
sale of an undertaking, a business, parts of an undertaking or parts of a
business.

 

(b) Neither Seller nor its Affiliates have any obligation to inform and consult
with any Employees or any Employee’s representatives, trade unions, works
council, or other labor organization, as a result of or in connection with the
consummation of the transactions contemplated hereby.

 

19

 

  

Section 4.11        Sufficiency of Assets. Except for the Shared Seller IP,
including the Utility Patents, which are not being transferred to Buyer
hereunder, the sale and transfer of the Purchased Assets will constitute a
conveyance to Buyer, free and clear of any Encumbrances, other than Permitted
Encumbrances, of all the assets, properties, interests and rights (including
tangible and intangible personal property) owned or used or held for use by
Seller and/or its Affiliates and necessary to conduct the Revo Business in
substantially the same manner as currently conducted.

 

Section 4.12        Inventory. The Inventory is in the physical possession of
Seller, and no Inventory has been pledged as collateral or otherwise is subject
to any Encumbrance (other than a Permitted Encumbrance) or is held on
consignment from others. The Inventory was acquired or produced in the ordinary
course of business. The Inventory is undamaged and is presently useable and
saleable in the ordinary course of business consistent with Seller’s current
quality standards for Revo Product.

 

Section 4.13        Customers and Suppliers. Section 4.13 of the Disclosure
Schedules sets forth an accurate and complete list of each supplier and customer
accounting for more than five percent (5%) of the consolidated purchases and
sales, as the case may be, of Seller and its Affiliates in respect of the Revo
Business, for the eighteen (18) month period ended June 30, 2013. Except as set
forth in Section 4.13 of the Disclosure Schedules, since January 1, 2013, no
supplier or customer has cancelled or otherwise terminated, or to the Knowledge
of Seller, threatened to cancel or otherwise terminate, its relationship with
Seller or any of its Affiliates with respect to the Revo Business. Since January
1, 2013, neither Seller nor any of its Affiliates has received any written
notice that any supplier or customer may cancel or otherwise materially and
adversely modify its relationship with Seller or any of its Affiliates or limit
its services, supplies or materials to Seller or any of its Affiliates in
respect of the Revo Business, or its usage or purchase of the services and
products of Seller and its Affiliates with respect to the Revo Business, either
as a result of the transactions contemplated hereby or otherwise.

 

Section 4.14        Product Liability.

 

(a) There have been no legal proceedings or suits relating to the Revo Business
or the Purchased Assets by or before any Governmental Authority against or
involving Seller or any of its Affiliates or concerning any Revo Product
manufactured, shipped, sold or delivered by or on behalf of any of them relating
to or resulting from an alleged defect in design, manufacture, materials or
workmanship of any product manufactured, shipped, sold or delivered by or on
behalf of Seller or any of its Affiliates with respect to the Revo Business or
any alleged failure to warn, or any alleged breach of implied warranties or
representations, and, to the Knowledge of Seller, none has been threatened.

 

(b) To the Knowledge of Seller, there has not been any Occurrence relating to
the Revo Business or the Purchased Assets that has had or would reasonably be
expected to have, individually or in the aggregate, a Material Adverse Effect.

 

20

 

  

(c) There has not been any product recall, post-sale warning or similar action
with respect to any Revo Product manufactured (or to be manufactured), shipped,
sold or delivered by or on behalf of Seller or any of its Affiliates.

 

(d) To the Knowledge of Seller, there have been no material defects in design,
manufacturing, materials or workmanship including any failure to warn, or any
breach of express or implied warranties or representations, which involve any
Revo Product manufactured, shipped, sold or delivered by or on behalf of Seller
or any of its Affiliates.

 

Section 4.15        Brokers.

 

(a) Except for Tegris LLC (whose fees and expenses shall be paid by Seller and
shall constitute Seller Transaction Expenses) no broker, finder, firm or
investment banker or any other Person is entitled to any brokerage, finder’s or
other fee or commission in connection with the transactions contemplated by this
Agreement or any other Transaction Document based upon arrangements made by or
on behalf of Seller.

 

Section 4.16        No Other Representations and Warranties. Except for the
representations and warranties contained in this Article IV (including the
related portions of the Disclosure Schedules), neither Seller, nor any other
Person, has made or makes any other express or implied representation or
warranty, either written or oral, on behalf of Seller including any
representation or warranty as to the accuracy or completeness of any information
regarding the Revo Business and the Purchased Assets furnished or made available
to Buyer and its Representatives, or as to the future revenue, profitability or
success of the Revo Business, or any representation or warranty arising from
statute or otherwise in law.

 

Article V
Representations and Warranties of Buyer

 

Except as set forth in the Disclosure Schedules, Buyer represents and warrants
to Seller that the statements contained in this Article V are true and correct
as of the date hereof.

 

Section 5.01        Organization of Buyer. Buyer is a limited liability company
duly organized, validly existing and in good standing under the Laws of the
state of Delaware and has all necessary limited liability company power and
authority to own, operate or lease the properties and assets now owned, operated
or leased by it and to carry on its business as currently conducted.

 

Section 5.02        Authority of Buyer. Buyer has all necessary limited
liability company power and authority to enter into this Agreement and the other
Transaction Documents to which Buyer is a party, to carry out its obligations
hereunder and thereunder and to consummate the transactions contemplated hereby
and thereby. The execution and delivery by Buyer of this Agreement and any other
Transaction Document to which Buyer is a party, the performance by Buyer of its
obligations hereunder and thereunder and the consummation by Buyer of the
transactions contemplated hereby and thereby have been duly authorized by all
requisite corporate action on the part of Buyer. This Agreement has been duly
executed and delivered by Buyer, and (assuming due authorization, execution and
delivery by Seller) this Agreement constitutes a legal, valid and binding
obligation of Buyer enforceable against Buyer in accordance with its terms,
except as such enforceability may be limited by bankruptcy, insolvency,
reorganization, moratorium or similar Laws affecting creditors’ rights generally
and by general principles of equity (regardless of whether enforcement is sought
in a proceeding at law or in equity).

 

21

 

  

Section 5.03        No Conflicts; Consents. The execution, delivery and
performance by Buyer of this Agreement and the other Transaction Documents to
which it is a party, and the consummation of the transactions contemplated
hereby and thereby, do not and will not: (a) result in a violation or breach of
or conflict with any provision of the certificate of incorporation or by-laws of
Buyer, in each case, amended as of the date of this Agreement; (b) result in a
violation or breach of or conflict with any provision of any Law or Governmental
Order applicable to Buyer; or (c) except as set forth in Section 5.03 of the
Disclosure Schedules, require the consent, notice or other action by any Person
under, conflict with, result in a violation or breach of, constitute a default
under or result in the acceleration of any agreement to which Buyer is a party,
except in the cases of clauses (b) and (c), where the violation, breach,
conflict, default, acceleration or failure to give notice would not have a
material adverse effect on Buyer’s ability to consummate the transactions
contemplated hereby. No consent, approval, Permit, Governmental Order,
declaration or filing with, or notice to, any Governmental Authority is required
by or with respect to Buyer in connection with the execution and delivery of
this Agreement and the other Transaction Documents and the consummation of the
transactions contemplated hereby and thereby, except for such consents,
approvals, Permits, Governmental Orders, declarations, filings or notices which
would not have a material adverse effect on Buyer’s ability to consummate the
transactions contemplated hereby and thereby.

 

Section 5.04        Brokers. No broker, finder, firm or investment banker or any
other Person is entitled to any brokerage, finder’s or other fee or commission
in connection with the transactions contemplated by this Agreement or any other
Transaction Document based upon arrangements made by or on behalf of Buyer.

 

Section 5.05        Sufficiency of Funds. Buyer has sufficient cash on hand or
other sources of immediately available funds to enable it to make payment of the
Purchase Price and consummate the transactions contemplated by this Agreement.

 

Section 5.06        Solvency. Immediately after giving effect to the
transactions contemplated hereby, Buyer shall be solvent and shall: (a) be able
to pay its debts as they become due; (b) own property and/or assets that have a
fair saleable value greater than the amounts required to pay its existing debts
(including a reasonable estimate of the amount of all contingent liabilities) as
they become absolute and matured; and (c) have adequate capital to carry on its
business. No transfer of property is being made and no obligation is being
incurred in connection with the transactions contemplated hereby with the intent
to hinder, delay or defraud either present or future creditors of Buyer. In
connection with the transactions contemplated hereby, Buyer has not incurred,
nor plans to incur, debts beyond its ability to pay as they become absolute and
matured.

 

Section 5.07        Legal Proceedings. There are no actions, suits, claims,
investigations or other legal proceedings pending or, to Buyer’s knowledge,
threatened against or by Buyer or any Affiliate of Buyer that challenge or seek
to prevent, enjoin or otherwise delay the transactions contemplated by this
Agreement.

 

22

 

  

Section 5.08        Independent Investigation. Buyer has conducted its own
independent investigation, review and analysis of the Revo Business and the
Purchased Assets, and acknowledges that it has been provided adequate access to
the personnel, properties, assets, premises, books and records, and other
documents and data of Seller for such purpose. Buyer acknowledges and agrees
that: (a) in making its decision to enter into this Agreement and to consummate
the transactions contemplated hereby, Buyer has relied solely upon its own
investigation and the express representations and warranties of Seller set forth
in Article IV of this Agreement (including related portions of the Disclosure
Schedules); and (b) neither Seller, nor any other Person has made any
representation or warranty as to Seller, the Revo Business, the Purchased Assets
or this Agreement, except as expressly set forth in Article IV of this Agreement
(including the related portions of the Disclosure Schedules).

 

Section 5.09        No Other Representations and Warranties. Except for the
representations and warranties contained in this Article V, neither Buyer nor
any other Person has made or makes any other express or implied representation
or warranty, either written or oral, on behalf of Buyer. Buyer hereby disclaims
any other express or implied representations or warranties with respect to
itself or such other Person.

 

Article VI
Covenants

 

Section 6.01        Transaction Documents. From and after the Closing, Seller
shall not, and shall cause its Affiliates not to, use any of the Intellectual
Property Assets, conduct any Revo Business or manufacture, distribute or sell
any Revo Product other than pursuant to and in accordance with the Transaction
Documents. Seller shall, and shall cause its Affiliates to, comply with the
terms of the Transaction Documents.

 

Section 6.02        Notification of Certain Matters. During the period beginning
on the Closing Date and ending on the one (1) year anniversary of the Closing
Date, Seller and its Affiliates shall promptly notify Buyer in writing of (a)
any actions, suits, claims or proceedings commenced or, to the Knowledge of
Seller, threatened in writing, relating to the Revo Business, the Purchased
Assets or the Assumed Liabilities, (b) any written notice of a default or event
that, with notice or lapse of time or both, would become a default under any
Contract disclosed (or required to be disclosed) on Section 4.05(a) of the
Disclosure Schedules, or (c) any written notice from any Person alleging that
the consent of such Person is or may be required in connection with the
transactions contemplated by this Agreement.

 

Section 6.03        Customer Letter; Public Announcements. Seller and Buyer
shall jointly prepare a letter to customers of the Revo Business, in
substantially the form of Exhibit I hereto, to be sent to such customers within
thirty (30) days after the Closing. None of the parties hereto (nor any of their
respective Affiliates) shall make any public announcements, disclosures to any
third party or news releases pertaining to this Agreement, its existence or any
of its contents without the prior written consent of the other party (which
consent shall not be unreasonably withheld, conditioned or delayed), except as
may be required by Law, regulatory process or securities exchange. In the event
any party or its Affiliate determines that disclosure is required, such party
shall provide advance notice and an advance copy of such disclosure to the other
party unless prohibited by the terms of the applicable order, subpoena, request
for disclosure or similar instrument, and in all cases such other party will
have the right to approve (which approval shall not be unreasonably withheld,
conditioned or delayed) any reference to such other party or any of its
Affiliates and, in the case where information to be disclosed is deemed by
either party to be of a sensitive nature or otherwise eligible for confidential
treatment under applicable rules and regulations, the parties agree that they
will use commercially reasonable efforts to cooperate to prepare the appropriate
documentation and filings (including redacting, to the extent permitted by Law,
any sensitive information requested by either party from the applicable
disclosures and agreements).

 

23

 

  

Section 6.04        Bulk Sales Laws. The parties hereby waive compliance with
the provisions of any bulk sales, bulk transfer or similar Laws of any
jurisdiction that may otherwise be applicable with respect to the sale of any or
all of the Purchased Assets to Buyer. If requested by Seller, Buyer agrees to
provide applicable resale certificate(s) to Seller. In the event any claim is
made by any creditor of Seller against Buyer or related to the transactions
contemplated hereby which could have been asserted under any bulk sales, bulk
transfer or similar Laws of any jurisdiction, Buyer shall notify Seller of such
claim and Seller shall have thirty (30) days in which to satisfy or discharge
such claim, or to take appropriate defensive action to dispute such claim in
accordance with Article VII (Indemnification) hereof. Seller shall indemnify
Buyer for all Losses (including any Tax liabilities) resulting from
non-compliance with any such Laws.

 

Section 6.05        Transfer Taxes. All transfer, documentary, sales, use,
stamp, registration and other such Taxes (other than any value added Taxes) and
fees (including any penalties and interest) incurred in connection with this
Agreement and the other Transaction Documents shall be borne and paid by Buyer
when due. Buyer shall, at its own expense, timely file any Tax Return or other
document with respect to such Taxes or fees (and Seller shall cooperate with
respect thereto as necessary).

 

Section 6.06        Tax Matters. All Taxes and Tax liabilities with respect to
the income or operations of the Revo Business or the ownership of the Purchased
Assets that relate to the Overlap Period shall be apportioned between Seller on
one hand and Buyer on the other as follows: (i) in the case of Taxes other than
sales and use and withholding Taxes, on a per diem basis; and (ii) in the case
of sales and use and withholding Taxes, as determined as if there was a closing
of the books and records on the Closing Date. Seller shall be liable for Taxes
with respect to the income or operations of the Revo Business or the ownership
of the Purchased Assets that are attributable to all Pre-Closing Periods, and
Buyer shall be liable for such Taxes to the extent attributable to taxable
periods beginning after the Closing Date or the portion of an Overlap Period
beginning after the Closing Date.

 

Section 6.07        Covenant Not to Sue. As of the Closing, Seller, for itself
and on behalf of its Affiliates, covenants not to sue, and agrees, for itself
and on behalf of its Affiliates, not to object to, oppose or otherwise challenge
the use by Buyer and/or its Affiliates and/or their respective successors,
assigns, licensees, sublicensees, contractors, manufacturers, agents and/or
representatives of the Utility Patents and any other Shared Seller IP in
connection with Revo Product, the Revo Business or any other future goods and
services developed or offered using, bearing, embodying or sold under any
Transferred Mark, or a Trademark confusingly similar to any Transferred Mark.
The foregoing covenant not to sue will survive any change of control of Seller,
its Affiliates, Buyer and/or its Affiliates and any sale, assignment, license,
transfer or disposition of any Shared Seller IP, including any of the Utility
Patents, the Purchased Assets or the Revo Business, and Buyer, Seller and their
respective Affiliates shall ensure that any successor in interest to any of the
foregoing assets agrees in writing to the terms of the covenant not to sue set
forth in this Section 6.07. Buyer shall agree that it shall not make reference
to the Utility Patents or Seller’s High Definition Optics™ (HDO™) in its
marketing materials for Revo Product. Subject to Seller and its Affiliates’
compliance with the terms of the covenant not to sue set forth in this Section
6.07, Buyer agrees not to challenge or contest, either directly or indirectly,
the validity or enforceability of any of the Utility Patents or their
continuations, continuations-in-part, divisionals, reissues or reexaminations.

 

24

 

  

Section 6.08        Commercial Accounts and Customer Warranty Claims.

 

(a) For a period of ninety (90) days after the Closing Date, Seller shall, and
shall cause its Affiliates to, accept return shipments from commercial accounts,
of Revo Product manufactured by Seller and/or its Affiliates, whether
manufactured (i) on or prior to the Closing Date or (ii) pursuant to any
Transaction Document. Notwithstanding the foregoing, the decision as to whether
to accept returns shall be at Seller’s reasonable discretion in accordance with
Seller’s standard procedures for acceptance of product returns from commercial
accounts.

 

(b) Seller shall, and shall cause its Affiliates to, be responsible for and
handle all customer warranty claims for a period of one (1) year after the
Closing Date for claims made in the United States, and for a period of two (2)
years after the Closing Date for claims made in Europe or Australia, related to
all Revo Product manufactured by Seller and/or its Affiliates, whether
manufactured (i) on or prior to the Closing Date or (ii) pursuant to any
Transaction Document.

 

(c) Buyer shall be responsible for and handle all customer warranty claims
related to all Revo Product manufactured by Buyer, its Affiliates and/or their
respective licensees (other than Seller and/or its Affiliates) after the
Closing.

 

(d) Seller shall be responsible for and shall indemnify Buyer from any and all
product liability claims, actions, loss, liability, judgments, expenses and
costs (including reasonable attorneys’ fees) related to (i) the Inventory
included in the Purchased Assets; and (ii) Revo Product or other products using
the Intellectual Property Assets or any other Revo IP manufactured prior to the
Closing Date or sold by Seller or its Affiliates, in each case whether asserted
before, on or after the Closing Date.

 

Section 6.09        Further Assurances. Following the Closing, without further
consideration, each of the parties hereto shall, and shall cause their
respective Affiliates to, execute and deliver such additional documents,
instruments, conveyances and assurances and take such further actions as may be
reasonably required to carry out the provisions hereof and give effect to the
transactions contemplated by this Agreement and the other Transaction Documents,
including (a) such further actions, at Buyer’s expense, as may be reasonably
required to register in the name of Buyer the assignment of the Intellectual
Property Assets in any appropriate governmental agency or registrar, (b) such
further actions, at Buyer’s expense, as may be reasonably required to substitute
Buyer as a party in the actions, suits, claims, investigations, audits and other
legal proceedings identified on Section 4.07(a) of the Disclosure Schedules and
(c) the use of commercially reasonable efforts to provide information requested
by Buyer pertaining to the Intellectual Property Assets in order for Buyer to
prosecute, maintain and enforce the Intellectual Property Assets. In the event
that any Seller or any of its Affiliates retained any of the Intellectual
Property Assets or failed to obtain any consent necessary for the transfer of
any Intellectual Property Assets, Seller shall (and shall cause its Affiliates
to) transfer of such Intellectual Property Assets to Buyer or obtain such
consent, as applicable, at Seller’s sole expense.

 

25

 

  

Article VII
Indemnification

 

Section 7.01        Survival. Subject to the limitations and other provisions of
this Agreement, the representations and warranties contained herein, in the
Disclosure Schedules, in any Exhibit or certificate attached hereto or delivered
pursuant to this Agreement shall survive the Closing and shall remain in full
force and effect until the date that is twelve (12) months from the Closing Date
except that (a) the Fundamental Representations shall survive indefinitely; and
(b) the representations and warranties contained in Section 4.09 (Taxes) and
Section 4.10 (Employees) shall survive until sixty (60) days following the
expiration of the applicable statute of limitations (giving effect to any
extensions and waivers thereof). Each covenant and other agreement contained in
this Agreement shall survive the Closing until the full performance of such
covenant or agreement in accordance with its terms. Notwithstanding the
foregoing, any claims asserted in good faith with reasonable specificity (to the
extent known at such time) and in writing by notice from the non-breaching party
to the breaching party prior to the expiration date of the applicable survival
period shall not thereafter be barred by the expiration of such survival period
and such claims shall survive until finally resolved, whether or not the amount
of the Losses resulting from such breach has been finally determined at the time
the notice is given.

 

Section 7.02        Indemnification By Seller. Subject to the other terms and
conditions of this Article VII, from and after the Closing, Seller agrees to
indemnify Buyer, its Affiliates and its and their respective Representatives
(the “Buyer Indemnitees”) against, and shall hold each of them harmless from and
against, any and all Losses suffered, incurred, paid, sustained by, or imposed
upon, any Buyer Indemnitee based upon, arising out of, with respect to or by
reason of:

 

(a) any failure of any representation or warranty made by Seller or its
Affiliates in Article IV of this Agreement or in any Transaction Document,
Disclosure Schedule or certificate delivered pursuant to this Agreement to be
true and correct in all respects (without giving effect to any “material”,
“materially”, “materiality”, “Material Adverse Effect”, “material adverse
effect”, “material adverse change” or similar qualification contained in any
such representation or warranty other than those contained in Section 4.04(d))
on and as of the Closing Date as if made at and as of such time (other than
those made on a specified date (other than any date specified in the preamble to
Article IV), which shall be true and correct in all respects as of such
specified date);

 

26

 

  

(b) any breach or non-fulfillment of any covenant, agreement or obligation to be
performed by any Seller or any of its Affiliates pursuant to this Agreement or
any Transaction Document;

 

(c) any Excluded Asset or any Excluded Liability;

 

(d) any failure by Seller or any of its Affiliates, or claim by a creditor of
Seller or any of its Affiliates that any of them has failed, in each case, to
comply with the provisions of any bulk sales, bulk transfer or similar Laws of
any jurisdiction;

 

(e) any Taxes (i) attributable to the Purchased Assets or the Revo Business with
respect to any Pre-Closing Period or (ii) imposed on Seller or any of its
Affiliates; or

 

(f) any claim or legal proceeding from any consultant or independent contractor
of Seller or any of its Affiliates, any Employee or employee representative, or
Governmental Order against Buyer or any of its Affiliates in relation to (i) the
employment or termination of the employment of any Employee or (ii) the
retention or termination of any such consultant or independent contractor.

 

Section 7.03        Indemnification By Buyer. Subject to the other terms and
conditions of this Article VII, Buyer shall indemnify Seller, its Affiliates and
its and their respective Representatives (the “Seller Indemnitees”), and shall
hold each of them harmless from and against, any and all Losses suffered,
incurred, paid, sustained by, or imposed upon, any Seller Indemnitee based upon,
arising out of, with respect to or by reason of:

 

(a) any failure of any representation or warranty made by Buyer in Article V of
this Agreement or in any Transaction Document, Disclosure Schedule or
certificate delivered pursuant to this Agreement to be true and correct in all
respects (without giving effect to any “material”, “materially”, “materiality”,
“Material Adverse Effect”, “material adverse effect”, “material adverse change”
or similar qualification contained in any such representation or warranty) on
and as of the Closing Date as if made at and as of such time (other than those
made on a specified date (other than any date specified in the preamble to
Article V), which shall be true and correct in all respects as of such specified
date);

 

(b) any breach or non-fulfillment of any covenant, agreement or obligation to be
performed by Buyer or its Affiliates pursuant to this Agreement or any
Transaction Document;

 

(c) any Assumed Liability; or

 

(d) any Taxes attributable to the Purchased Assets or the Revo Business to the
extent attributable to taxable periods beginning after the Closing Date or the
portion of an Overlap Period beginning after the Closing Date.

 

27

 

  

Section 7.04        Certain Limitations. The party making a claim under this
Article VII is referred to as the “Indemnified Party”, and the party against
whom such claims are asserted under this Article VII is referred to as the
“Indemnifying Party”. The indemnification provided for in Section 7.02 and
Section 7.03 shall be subject to the following limitations:

 

(a) The Indemnifying Party shall not be liable to the Indemnified Party for
indemnification under Section 7.02(a) or Section 7.03(a), as the case may be,
until the aggregate amount of all Losses in respect of indemnification under
Section 7.02(a) or Section 7.03(a) exceeds One Hundred Thousand Dollars
($100,000.00) (the “Deductible”), in which event the Indemnifying Party shall
only be required to pay or be liable for Losses in excess of the Deductible. The
parties agree that any claim for any individual Loss or group of related Losses
indemnifiable pursuant to Section 7.02(a) or Section 7.03(a), as applicable, in
an amount less than Five Thousand Dollars ($5,000.00) shall not count towards
the applicable Deductible. Notwithstanding anything herein to the contrary, the
limitations set forth in this Section 7.04(a) shall not apply to Losses
described in Sections 7.02(b)-(f) or Sections 7.03(b)-(d), or to Losses incurred
by (i) any Buyer Indemnitee in connection with or arising from any breach of any
Fundamental Representation of Seller or any representation or warranty of Seller
in Section 4.09 (Taxes), and (ii) any Seller Indemnitee in connection with or
arising from any breach of any Fundamental Representation of Buyer.

 

(b) The aggregate amount of all Losses for which an Indemnifying Party shall be
liable pursuant to Section 7.02 or Section 7.03, as the case may be, shall not
exceed One Million Five Hundred Thousand Dollars ($1,500,000.00); provided, that
the limitation set forth in the first clause of this Section 7.04(b) shall not
apply to (i) Losses described in Sections 7.02(c)-(f) or Sections 7.03(c)-(d),
(ii) Losses described in Section 7.02(b) or Section 7.03(b) as a result of any
willful or intentional breach or non-fulfillment, or (iii) Losses incurred by
(A) any Buyer Indemnitee in connection with or arising from any breach of any
Fundamental Representation of Seller or any representation or warranty of Seller
in Section 4.09 (Taxes) or Section 4.10 (Employees), or (B) any Seller
Indemnitee in connection with or arising from any breach of any Fundamental
Representation of Buyer; provided, further, that the maximum aggregate amount of
all Losses for which an Indemnifying Party shall be liable pursuant to Section
7.02 or Section 7.03, as the case may be, shall not exceed the Purchase Price.

 

(c) Payments by an Indemnifying Party pursuant to Section 7.02 or Section 7.03
in respect of any Loss shall be limited to the amount of any liability or damage
that remains after deducting therefrom any insurance proceeds (net of any costs
of investigation of the underlying claim and collection, including Taxes) and
any indemnity, contribution or other similar payment actually received by the
Indemnified Party in respect of such Loss.

 

(d) Payments by an Indemnifying Party pursuant to Section 7.02 or Section 7.03
in respect of any Loss shall be reduced by an amount equal to any Tax benefit
actually realized as a result of such Loss by the Indemnified Party in, or prior
to, the taxable year the Loss was incurred.

 

(e) No Indemnifying Party shall be liable to any Indemnified Party for any
punitive, incidental, consequential, special or indirect damages, including loss
of future revenue or income, loss of business reputation or opportunity relating
to the breach or alleged breach of this Agreement, or diminution of value or any
damages based on any type of multiple (collectively, “Special Damages”);
provided, that Special Damages shall be indemnifiable pursuant to Section 7.02
or Section 7.03, as applicable, to the extent Special Damages are (i) actually
paid to a third party pursuant to any settlement entered into by the Indemnified
Party in accordance with Section 7.05, provided that the Indemnifying Party has
consented in writing to any such settlement, or (ii) ordered, by a court of
competent jurisdiction, to be paid by the Indemnified Party to a third party.

 

28

 

  

(f) Each Indemnified Party shall take, and cause its Affiliates to take,
commercially reasonable steps to mitigate any Loss as soon as reasonably
practicable upon becoming aware of any event or circumstance that would be
reasonably expected to, or does, give rise thereto, such Loss.

 

Section 7.05        Indemnification Procedures.

 

(a) Third Party Claims. If any Indemnified Party receives notice of the
assertion or commencement of any action, suit, claim or other legal proceeding
made or brought by any Person who is not a party to this Agreement (a “Third
Party Claim”) against such Indemnified Party with respect to which the
Indemnifying Party is obligated to provide indemnification under this Agreement,
the Indemnified Party shall deliver as promptly as practicable a written notice
(a “Claim Certificate”), which Claim Certificate shall describe the Third Party
Claim (or Direct Claim, if delivered pursuant to Section 7.05(c)) in reasonable
detail, shall include copies of all material written evidence thereof and shall
indicate the estimated amount, if reasonably practicable, of the Loss that has
been or may be sustained by the Indemnified Party. The failure to provide such
Claim Certificate shall not, however, relieve the Indemnifying Party of its
indemnification obligations, except and only to the extent that the Indemnifying
Party forfeits rights or defenses by reason of such failure or is materially
prejudiced thereby. The Indemnifying Party shall have the right to participate
in or, by giving written notice to the Indemnified Party within ten (10)
Business Days after its receipt of a Claim Certificate, to assume the defense
of, the Third Party Claim described in such Claim Certificate at the
Indemnifying Party’s expense and by the Indemnifying Party’s own counsel, and
the Indemnified Party shall cooperate in good faith in such defense; provided,
that the Indemnifying Party shall only have the right to assume the defense of a
Third Party Claim if the Indemnifying Party acknowledges in writing its
indemnity obligation; provided, further, that in the event that the Indemnifying
Party assumes the defense of any Third Party Claim, then (x) subject to Section
7.05(b), it shall have the right to take such action as it deems necessary to
avoid, dispute, defend, appeal or make counterclaims pertaining to any such
Third Party Claim in the name and on behalf of the Indemnified Party and (y) the
Indemnified Party shall have the right, at its own cost and expense, to
participate in the defense of any Third Party Claim with counsel selected by it.
Notwithstanding anything to the contrary contained in this Agreement, the
Indemnifying Party shall not be entitled to assume control of the defense of a
Third Party Claim and shall pay, subject to the limitations of liability set
forth in Section 7.04, the fees and expenses of counsel retained by the
Indemnified Party if: (i) such Third Party Claim may give rise to Losses which
are more than 100% of the amount indemnifiable by such Indemnifying Party
pursuant to this Section 7.05; (ii) such Third Party Claim for indemnification
relates to or arises in connection with any criminal proceeding, action,
indictment, allegation or investigation; (iii) such Third Party Claim seeks an
injunction or equitable relief against the Indemnified Party; (iv) the
Indemnified Party has been advised in writing by counsel that a reasonable
likelihood exists of a conflict of interest between the Indemnifying Party and
the Indemnified Party; (v) the Indemnified Party reasonably believes an adverse
determination with respect to the action, lawsuit, investigation, proceeding or
other claim giving rise to such claim for indemnification would be detrimental
to or injure the Indemnified Party’s reputation or future business prospects; or
(vi) upon petition by the Indemnified Party, the appropriate court rules that
the Indemnifying Party failed or is failing to vigorously prosecute or defend
such Third Party Claim. Notwithstanding any other provision of this Agreement,
with respect to a claim for indemnification with respect to Taxes, (A) Seller
shall have the right to control such claim for indemnification if, but only if,
such claim relates solely to Taxes (1) attributable to the Purchased Assets or
the Revo Business with respect to any Pre-Closing Period or (2) imposed on
Seller and (B) Seller shall not consent to have any settlement or compromise of
any such claim without the written consent of Buyer, which consent shall not be
unreasonably withheld or delayed. If the Indemnifying Party elects not to
compromise or defend such Third Party Claim or fails to promptly notify the
Indemnified Party in writing of its election to defend as provided in this
Agreement, the Indemnified Party may, subject to Section 7.05(b), pay,
compromise, defend such Third Party Claim and seek indemnification for any and
all Losses based upon, arising from or relating to such Third Party Claim.
Seller and Buyer shall cooperate with each other in all commercially reasonable
respects in connection with the defense of any Third Party Claim, including
making available records relating to such Third Party Claim.

 

29

 

  

(b) Settlement of Third Party Claims.

 

(i)                 Any Indemnified Party shall have the right to employ
separate counsel and to participate in the defense of any Third Party Claim, but
the fees and expenses of such counsel shall not be at the expense of the
Indemnifying Party unless (A) the Indemnifying Party shall have failed, or is
not entitled, to assume the defense of such Third Party Claim in accordance with
Section 7.05(a), (B) the employment of such counsel has been specifically
authorized in writing by the Indemnifying Party, which authorization shall not
be unreasonably withheld, or (C) the named parties to any such action (including
any impleaded parties) include both such Indemnified Party and the Indemnifying
Party and such Indemnified Party shall have been advised in writing by such
counsel that there may be one (1) or more legal defenses available to the
Indemnified Party which are not available to the Indemnifying Party, or are
available to the Indemnifying Party but the assertion of which would be adverse
to the interests of the Indemnified Party. So long as the Indemnifying Party is
reasonably contesting any such Third Party Claim in good faith, the Indemnified
Party shall not pay or settle any such Third Party Claim. Notwithstanding the
foregoing, the Indemnified Party shall have the right to pay or settle any such
Third Party Claim; provided that in such event it shall waive any right to
indemnity therefor by the Indemnifying Party for such Third Party Claim unless
the Indemnifying Party shall have consented to such payment or settlement.

 

(ii)               If the Indemnifying Party does not notify the Indemnified
Party within ten (10) Business Days after the receipt of a Claim Certificate
with respect to a Third Party Claim hereunder that it elects to undertake the
defense thereof, or if the Indemnified Party assumes the defense of such Third
Party Claim pursuant to Section 7.05(a), the Indemnified Party shall have the
right to contest, settle or compromise the Third Party Claim but shall not
thereby waive any right to indemnity therefor pursuant to this Agreement;
provided, that the Indemnified Party shall not agree to any settlement without
the written consent of the Indemnifying Party (which consent shall not be
unreasonably withheld, conditioned or delayed).

 

30

 

  

(iii)             Notwithstanding any other provision of this Agreement, the
Indemnifying Party shall not, without the prior written consent of the
Indemnified Party, enter into any settlement of a Third Party Claim that is not
entirely indemnifiable by the Indemnifying Party pursuant to this Article VII
and does not include as an unconditional term thereof the giving by the Person
or Persons asserting such Third Party Claim to all Indemnified Parties of an
unconditional release from all liability with respect to such Third Party Claim
or consent to entry of any judgment.

 

(c) Direct Claims. Any claim by an Indemnified Party on account of a Loss which
does not result from a Third Party Claim (a “Direct Claim”) shall be asserted by
the Indemnified Party giving the Indemnifying Party reasonably prompt written
notice thereof in a Claim Certificate. The failure to provide such Claim
Certificate shall not, however, relieve the Indemnifying Party of its
indemnification obligations, except and only to the extent that the Indemnifying
Party forfeits rights or defenses by reason of such failure or is materially
prejudiced thereby. In the event that the Indemnifying Party objects to the
indemnification of an Indemnified Party in respect of any claim or claims
specified in any Claim Certificate, the Indemnifying Party shall, within thirty
(30) days after receipt by the Indemnifying Party of such Claim Certificate,
deliver to the Indemnified Party a notice to such effect, specifying in
reasonable detail the basis for such objection, and the Indemnifying Party and
the Indemnified Party shall, within the sixty (60) day period beginning on the
date of receipt by the Indemnified Party of such objection, attempt in good
faith to agree upon the rights of the respective parties with respect to each of
such claims to which the Indemnifying Party shall have so objected. During such
sixty (60) day period, the Indemnified Party shall allow the Indemnifying Party
and its Representatives to investigate the matter or circumstance alleged to
give rise to the Direct Claim, and whether and to what extent any amount is
payable in respect of the Direct Claim and the Indemnified Party shall assist
the Indemnifying Party’s investigation by giving such reasonable information and
assistance (including a copy of any accounts, documents or records) as the
Indemnifying Party or any of its Representatives may reasonably request. If the
Indemnified Party and the Indemnifying Party shall succeed in reaching agreement
on their respective rights with respect to any of such claims, the Indemnified
Party and the Indemnifying Party shall promptly prepare and sign a memorandum
setting forth such agreement. Should the Indemnified Party and the Indemnifying
Party be unable to agree as to any particular item or items or amount or amounts
within such time period, then the Indemnified Party shall be permitted to submit
such dispute to the courts set forth in Section 8.09. Claims for Losses
specified in any Claim Certificate to which an Indemnifying Party shall not
object in writing within thirty (30) days of receipt of such Claim Certificate,
claims for Losses covered by a memorandum of agreement of the nature described
above and claims for Losses the validity and amount of which have been the
subject of judicial determination as described above and in Section 8.09 or
shall have been settled with the consent of the Indemnified Party, as described
in Section 7.05(b) are hereinafter referred to, collectively, as “Agreed
Claims”. Within ten (10) Business Days of the determination of the amount of any
Agreed Claim, the Indemnifying Party shall pay to the Indemnified Party an
amount equal to the Agreed Claim by wire transfer in immediately available funds
to the bank account or accounts designated by the Indemnified Party in a notice
to the Indemnifying Party not less than two (2) Business Days prior to such
payment.

 

31

 

  

(d) No Right of Offset. Notwithstanding anything to contrary contained in this
Agreement, Seller acknowledges and agrees that in the event that Buyer is
obligated to make an indemnification payment to any Seller Indemnitee under
Section 7.03, (i) no Seller Indemnitee shall have any right to offset all or any
portion of the amount of such indemnification obligation against any amounts
owed to Buyer or any of its Affiliates or licensees under any Transaction
Documents and (ii) Seller shall not, and shall cause each Seller Indemnitee not
to, effect any such offset.

 

Section 7.06        Seller’s Obligation to Cause Affiliates to Act. Seller
acknowledges and agrees that, to the extent any provision of this Agreement
requires any of Seller’s Affiliates, or Seller agrees on behalf of its
Affiliates, to perform, take or refrain from taking any action, (a) Seller shall
have an obligation to cause such Affiliate to perform, take and/or refrain from
taking such action, as applicable, and (b) the failure of such Affiliate to
perform, take or refrain from taking such action shall constitute a breach by
Seller of such provision (notwithstanding any lack of an express obligation on
the part of Seller to cause such Affiliate to take such action).

 

 

Article VIII
Miscellaneous

 

Section 8.01        Expenses. Except as otherwise expressly provided herein, all
costs and expenses, including fees and disbursements of counsel, financial
advisors and accountants, incurred in connection with this Agreement and the
transactions contemplated hereby shall be paid by the party incurring such costs
and expenses, whether or not the Closing shall have occurred.

 

Section 8.02        Notices. All notices, requests, consents, claims, demands,
waivers and other communications hereunder shall be in writing and shall be
deemed to have been given (a) when received by the addressee if delivered by
hand or sent by a nationally recognized overnight courier (receipt requested);
(c) on the date sent by facsimile or e-mail of a PDF document if sent between
9:00 A.M, and 6:00 P.M. New York City time on any Business Day, and on the next
Business Day if sent outside of such hours or (d) on the third day after the
date mailed, by certified or registered mail, return receipt requested, postage
prepaid. In the case of facsimile or e-mail of a PDF document, such copies shall
also be sent by overnight courier service or by registered mail. Such
communications must be sent to the respective parties at the following addresses
(or at such other address for a party as shall be specified in a notice given in
accordance with this Section 8.02):

 

If to Seller to:Oakley, Inc.

One Icon

Foothill Ranch, CA 92610

Attn: Senior Vice President & Chief Financial Officer

Fax No.: 949.672.6096

Email: Gianluca@oakley.com

 

with a copy to:Oakley, Inc.

25361 Commercentre Drive

Lake Forest, CA 92630

Attn: Director of Legal Affairs

Fax No.: 949.699.3565

 

32

 

  

or to such other person or address as Seller shall furnish to Buyer in writing.

 

If to Buyer to:SBG Revo Holdings, LLC

c/o Sequential Brands Group, Inc.

1065 Avenue of the Americas, 30th Floor

New York, NY 10018

Attn: Chief Executive Officer

Email: yshmidman@sbg-ny.com

 

with a copy (which shall not constitute notice) to:

 

White & Case LLP
1155 Avenue of the Americas
New York, NY 10036
Fax No.: 212.354.8113
Attn: Nazim Zilkha

 

or to such other person or address as Buyer shall furnish to Seller in writing.

 

Notices sent by multiple means, each of which is in compliance with the
provisions of this Agreement will be deemed to have been received at the
earliest time provided for by this Agreement.

 

Section 8.03        Interpretation. For purposes of this Agreement, (a) the
words “include,” “includes” and “including” shall be deemed to be followed by
the words “without limitation”; (b) the word “or” is not exclusive; and (c) the
words “herein,” “hereof,” “hereby,” “hereto” and “hereunder” refer to this
Agreement as a whole. Unless the context otherwise requires, references herein:
(x) to Articles, Sections, Disclosure Schedules and Exhibits mean the Articles
and Sections of, and Disclosure Schedules and Exhibits attached to, this
Agreement; (y) to an agreement, instrument or other document means such
agreement, instrument or other document as amended, supplemented and modified
from time to time to the extent permitted by the provisions thereof and (z) to a
statute means such statute as amended from time to time and includes any
successor legislation thereto and any regulations promulgated thereunder. This
Agreement shall be construed without regard to any presumption or rule requiring
construction or interpretation against the party drafting an instrument or
causing any instrument to be drafted. The Disclosure Schedules and Exhibits
referred to herein shall be construed with, and as an integral part of, this
Agreement to the same extent as if they were set forth verbatim herein.

 

Section 8.04        Headings. The headings in this Agreement are for reference
only and shall not affect the interpretation of this Agreement.

 

Section 8.05        Severability. If any term or provision of this Agreement is
invalid, illegal or unenforceable in any jurisdiction, such invalidity,
illegality or unenforceability shall not affect any other term or provision of
this Agreement or invalidate or render unenforceable such term or provision in
any other jurisdiction. Upon such determination that any term or other provision
is invalid, illegal or unenforceable, the parties hereto shall negotiate in good
faith to modify this Agreement so as to effect the original intent of the
parties as closely as possible in a mutually acceptable manner in order that the
transactions contemplated hereby be consummated as originally contemplated to
the greatest extent possible.

 

33

 

  

Section 8.06        Entire Agreement. This Agreement, together with the Exhibits
hereto, the Disclosure Schedules and the other Transaction Documents constitute
the sole and entire agreement of the parties to this Agreement with respect to
the subject matter contained herein and therein, and supersede all prior and
contemporaneous representations, warranties, understandings and agreements, both
written and oral, with respect to such subject matter. In the event of any
inconsistency between the statements in the body of this Agreement and those in
the other Transaction Documents, the Exhibits and Disclosure Schedules (other
than an exception expressly set forth as such in the Disclosure Schedules), the
statements in the body of this Agreement will control.

 

Section 8.07        Binding Effect; Successors and Assigns. This Agreement shall
be binding upon and shall inure to the benefit of the parties hereto and their
respective successors and permitted assigns. Except with respect to Article VII
hereof, which shall inure to the benefit of each Buyer Indemnitee and Seller
Indemnitee, all of whom are intended as express third-party beneficiaries
thereof, no other Person not party to this Agreement shall be entitled to the
benefits of this Agreement. Neither party may assign its rights or obligations
hereunder without the prior written consent of the other party, which consent
shall not be unreasonably withheld or delayed; provided, that after the Closing
Date either party may assign its rights, interests and obligations hereunder to
any of its respective Affiliates. Each party shall provide written notice to the
other party of any such assignment. Any attempted assignment in violation of
this Section 8.07 will be void. Notwithstanding any assignment by any party
pursuant to this Section 8.07, such party shall be responsible for full
performance of such party’s covenants, agreements and obligations hereunder.

 

Section 8.08        Amendment and Modification; Waiver. This Agreement may only
be amended, modified or supplemented by an agreement in writing signed by each
party hereto. No waiver by any party of any of the provisions hereof shall be
effective unless explicitly set forth in writing and signed by the party so
waiving. No waiver by any party shall operate or be construed as a waiver in
respect of any failure, breach or default not expressly identified by such
written waiver, whether of a similar or different character, and whether
occurring before or after that waiver. No failure to exercise, or delay in
exercising, any right, remedy, power or privilege arising from this Agreement
shall operate or be construed as a waiver thereof; nor shall any single or
partial exercise of any right, remedy, power or privilege hereunder preclude any
other or further exercise thereof or the exercise of any other right, remedy,
power or privilege.

 

Section 8.09        Governing Law; Submission to Jurisdiction; Waiver of Jury
Trial.

 

(a) This Agreement shall be governed by and construed in accordance with the
internal laws of the State of New York. The parties expressly waive the
application of the United Nations Convention on the International Sale of Goods
to this Agreement.

 

34

 

  

(b) ANY LEGAL SUIT, ACTION OR PROCEEDING ARISING OUT OF OR BASED UPON THIS
AGREEMENT, THE OTHER TRANSACTION DOCUMENTS OR THE TRANSACTIONS CONTEMPLATED
HEREBY OR THEREBY MAY BE INSTITUTED IN THE FEDERAL COURTS OF THE UNITED STATES
OF AMERICA OR THE COURTS OF THE STATE OF NEW YORK IN EACH CASE LOCATED IN THE
BOROUGH OF MANHATTAN, STATE OF NEW YORK, AND EACH PARTY IRREVOCABLY SUBMITS TO
THE EXCLUSIVE JURISDICTION OF SUCH COURTS IN ANY SUCH SUIT, ACTION OR
PROCEEDING. SERVICE OF PROCESS, SUMMONS, NOTICE OR OTHER DOCUMENT BY MAIL TO
SUCH PARTY’S ADDRESS SET FORTH HEREIN SHALL BE EFFECTIVE SERVICE OF PROCESS FOR
ANY SUIT, ACTION OR OTHER PROCEEDING BROUGHT IN ANY SUCH COURT. THE PARTIES
IRREVOCABLY AND UNCONDITIONALLY WAIVE ANY OBJECTION TO THE LAYING OF VENUE OF
ANY SUIT, ACTION OR ANY PROCEEDING IN SUCH COURTS AND IRREVOCABLY WAIVE AND
AGREE NOT TO PLEAD OR CLAIM IN ANY SUCH COURT THAT ANY SUCH SUIT, ACTION OR
PROCEEDING BROUGHT IN ANY SUCH COURT HAS BEEN BROUGHT IN AN INCONVENIENT FORUM.

 

(c) EACH PARTY ACKNOWLEDGES AND AGREES THAT ANY CONTROVERSY WHICH MAY ARISE
UNDER THIS AGREEMENT OR THE OTHER TRANSACTION DOCUMENTS IS LIKELY TO INVOLVE
COMPLICATED AND DIFFICULT ISSUES AND, THEREFORE, EACH SUCH PARTY IRREVOCABLY AND
UNCONDITIONALLY WAIVES ANY RIGHT IT MAY HAVE TO A TRIAL BY JURY IN RESPECT OF
ANY LEGAL ACTION ARISING OUT OF OR RELATING TO THIS AGREEMENT, THE OTHER
TRANSACTION DOCUMENTS OR THE TRANSACTIONS CONTEMPLATED HEREBY OR THEREBY. EACH
PARTY TO THIS AGREEMENT CERTIFIES AND ACKNOWLEDGES THAT (A) NO REPRESENTATIVE OF
ANY OTHER PARTY HAS REPRESENTED, EXPRESSLY OR OTHERWISE, THAT SUCH OTHER PARTY
WOULD NOT SEEK TO ENFORCE THE FOREGOING WAIVER IN THE EVENT OF A LEGAL ACTION,
(B) SUCH PARTY HAS CONSIDERED THE IMPLICATIONS OF THIS WAIVER, (C) SUCH PARTY
MAKES THIS WAIVER VOLUNTARILY, AND (D) SUCH PARTY HAS BEEN INDUCED TO ENTER INTO
THIS AGREEMENT BY, AMONG OTHER THINGS, THE MUTUAL WAIVERS AND CERTIFICATIONS IN
THIS SECTION.

 

Section 8.10        Specific Performance. The parties agree that irreparable
damage would occur if any provision of this Agreement were not performed in
accordance with the terms hereof and that the parties shall be entitled to
specific performance of the terms hereof, in addition to any other remedy to
which they are entitled at law or in equity.

 

Section 8.11        Knowledge. When any representation, warranty, covenant or
agreement contained in this Agreement is expressly qualified by reference to the
“Knowledge of Seller”, it shall mean the actual knowledge of the officers and
other members of management of Seller responsible for conducting the Revo
Business.

 

Section 8.12        Counterparts. This Agreement may be executed in
counterparts, each of which shall be deemed an original, but all of which
together shall be deemed to be one and the same agreement. A signed copy of this
Agreement delivered by facsimile, e-mail or other means of electronic
transmission shall be deemed to have the same legal effect as delivery of an
original signed copy of this Agreement.

 

[SIGNATURE PAGE FOLLOWS]

 

35

 

  

IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be executed
as of the date first written above by their respective officers thereunto duly
authorized.

 

SELLER: BUYER:     OAKLEY, INC. SBG REVO HOLDINGS, LLC       By:  Sequential
Brands Group, Inc., By:  /s/ Colin Baden___________________         its sole
member Name:  Colin Baden   Title:  Chief Executive Officer & President    
        By:  /s/ Yehuda Shmidman___________
        Name:  Yehuda Shmidman By:  /s/ Gianluca A. Tagliabue___________
        Title:  Chief Executive Officer Name:  Gianluca A. Tagliabue  

Title: Senior Vice President & Chief Financial Officer